✨ Financial Disclosure
4118 NEW ZEALAND GAZETTE, No. 140 23 NOVEMBER 2012
TRANSPOWER NEW ZEALAND LIMITED LINES BUSINESS
27. Significant judgements / estimates
Regulation and the NIGU project
The NIGU project is forecast to exceed its initial approved amount by approximately $70 million. The board have made the judgement that no impairment is required in the 2012 financial statements. Note 23, Contingencies contains further details on this item.
Valuation of property
A valuation and subsequent impairment of $3.9 million was made on Transpower’s property assets. The impairment was based on a desktop valuation by Crighton Anderson, registered valuers. Some of these properties relate to those on the North Island Grid Upgrade (NIGU) route between Whakamaru and south Auckland purchased for the purposes of establishing easements and then on-selling. Some of these properties are classified as held for sale based on Transpower’s judgement that they expect a sale within 12 months. Refer to Note 13 Non current assets for more information.
Dismantling provision
An estimate and assumption made regarding future events was in relation to a dismantling provision. This provision has a balance at 30 June 2012 of $10.8 million (30 June 2011: $13.6 million). The nature and uncertainty of this provision is discussed in Note 15 Provisions.
Fair values of debt, derivatives and deposits.
A key estimate is in relation to the fair values of debt, derivatives and deposits. Fair values are determined upon discounting cash flows based upon the relevant yield curve. The yield curve is adjusted to reflect the credit spread of the counterparty to the transaction. These valuations are considered level two in the NZ IFRS three level valuation hierarchy.
Non current assets
Transpower has exercised judgement, with assistance from independent engineers, in determining the useful life of property, plant and equipment and finite life intangible assets.
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NZ Gazette 2012, No 140
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Transpower New Zealand Limited Financial Statements
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