Port Nelson Annual Report 2007 (pdf)
Port Nelson Annual Report 2007 (pdf) Port Nelson Annual Report 2007 (pdf)
S T A T E M E N T A C C O U N T I N G P O L I C I E S 1.10 Goods and Services Tax All items in the financial statements are exclusive of Goods and Services Tax (GST) with the exception of receivables and payables which are stated with the GST included. Where GST is not recoverable as an input tax then it is recognised as part of the related asset or expense. The net amount of GST recoverable from, or payable to, the Inland Revenue Department (IRD) is included as part of receivables or payables in the Balance Sheet. The net GST paid to or received from the IRD, including the GST relating to investing and financing activities, is classified as an operating cash flow in the Statement of Cash Flows. Commitments and Contingencies are disclosed exclusive of GST. 1.11 Income Tax The income tax expense for the period is the tax payable on the current period’s taxable income based on the income tax rate and adjusted by changes in Deferred Tax Assets and Liabilities attributable to temporary differences between the tax bases of assets and liabilities and their carrying amounts in the financial statements and for unused tax losses (if any). Deferred Tax Assets and Liabilities are recognised for temporary differences at the rate expected to apply when the assets are recovered or liabilities are settled. The tax rate is applied to the cumulative amounts of deductible and taxable temporary differences to measure the Deferred Tax Asset or Liability. Deferred Tax Assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable amounts will be available to utilise those temporary differences and losses. Deferred tax is charged or credited to the Income Statement, except where it relates to items charged or credited directly to equity, in which case the tax is dealt within equity. 1.12 Borrowings Borrowings are initially recognised at their fair value. After initial recognition, all borrowings are measured at amortised cost using the effective interest method where this differs from face value. 1.13 Derivative Financial Instruments Port Nelson uses derivative financial instruments such as interest rate swaps to hedge against interest rate fluctuations. Port Nelson does not hold or issue derivative financial instruments for trading purposes. Such derivative financial instruments are stated at fair value. The fair value of interest rate swaps is determined by reference to market values. The effective portion of changes in the fair value of the derivative financial instruments that are designated and qualify as cash flow hedges are deferred in equity. If a hedging instrument is sold, terminated, revoked or no longer meets the criteria for hedge accounting, the cumulative gain or loss that remains recognised directly in equity from the period when the hedge was effective will be recognised in the Income Statement. 1.14 Financing Costs Finance costs are recognised as an expense when incurred. Financing costs directly attributable to buildings under construction are capitalised as part of the cost of those assets. 1.15 Employee Entitlements Provision is made in respect of the company’s liability for annual leave, long service leave and retirement gratuities. Annual leave and long service leave has been calculated on an actual entitlement basis at current rates of pay and retirement gratuities calculated at current rates of pay assuming the payment will be made upon retirement. 1.16 Foreign Exchange Transactions Transactions in foreign currencies are converted at the New Zealand rate of exchange ruling at the date of the transaction. Capital items are converted at the exchange rate ruling at balance date or the forward exchange contract rate where applicable. 1.17 Leases Leases of plant and equipment are classified as operating leases. Operating lease payments are charged as an expense in the period in which they are incurred, as this represents the pattern of benefits derived from the leased assets. 1.18 Dividends Provision is made for the amount of any dividend declared on or before the end of the financial year but not distributed at balance date. 1.19 Critical Judgements Management have not had to exercise any critical judgements in the period ending 30 June 2007. C H A N G E S I N A C C O U N T I N G P O L I C I E S There have been no changes in accounting policies during the financial year. 2 8
N O T E S T O T H E A C C O U N T S N O T E 1 : R E V E N U E 2007 2006 Includes the following revenue: $000 $000 P O R T O P E R A T I O N S Port Operations 27,702 25,269 Interest 107 67 Gain on Sale of Assets 55 28 Total Port Operations 27,864 25,364 P R O P E R T Y Non Investment Property 3,542 3,399 Investment Property 895 791 Fair Value Adjustment to Investment Property 722 712 Total Property 5,159 4,902 T O T A L R E V E N U E 33,023 30,266 All revenue relates to continuing operations. N O T E 2 : N E T S U R P L U S B E F O R E T A X A T I O N 2007 2006 Includes the following expense: $000 $000 Administration Related 2,439 2,100 Audit Fees – IFRS Restatement 21 - Audit Fees – Non IFRS 54 51 Bad Debts Written Off 112 2 Depreciation and Amortisation 3,636 3,736 Directors Fees 159 136 Donations/Corporate Sponsorship 195 159 Employee Wages and Related Expenses 7,703 6,926 Interest 2,513 1,564 Impairment - 194 Investment Property Expenses 12 12 Loss on Sale of Assets 36 - Operating Leases 20 19 Other Operating Expenses 6,380 5,338 T O T A L E X P E N S E 23,280 20,237 All expenses relate to continuing operations. N O T E 3 : P R O V I S I O N F O R T A X A T I O N 2007 2006 $000 $000 Current Tax 3,277 3,284 Deferred Tax (143) (143) Deferred Tax Relating to Changes in Tax Rates (116) - T A X E X P E N S E 3,018 3,141 Profit from Continuing Operations 9,743 10,728 Tax at 33% 3,215 3,540 Non Deductible Expenses 57 67 Non Taxable Income (238) (466) Adjustments to Prior Year Estimates 100 - Deferred Tax Relating to Changes in Tax Rates (116) - T A X E X P E N S E 3,018 3,141 2 9
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S T A T E M E N T A C C O U N T I N G P O L I C I E S<br />
1.10 Goods and Services Tax<br />
All items in the financial statements are exclusive of Goods and Services Tax (GST) with the exception of receivables and payables<br />
which are stated with the GST included. Where GST is not recoverable as an input tax then it is recognised as part of the related asset<br />
or expense.<br />
The net amount of GST recoverable from, or payable to, the Inland Revenue Department (IRD) is included as part of receivables or<br />
payables in the Balance Sheet.<br />
The net GST paid to or received from the IRD, including the GST relating to investing and financing activities, is classified as an operating<br />
cash flow in the Statement of Cash Flows.<br />
Commitments and Contingencies are disclosed exclusive of GST.<br />
1.11 Income Tax<br />
The income tax expense for the period is the tax payable on the current period’s taxable income based on the income tax rate and<br />
adjusted by changes in Deferred Tax Assets and Liabilities attributable to temporary differences between the tax bases of assets and<br />
liabilities and their carrying amounts in the financial statements and for unused tax losses (if any).<br />
Deferred Tax Assets and Liabilities are recognised for temporary differences at the rate expected to apply when the assets are recovered<br />
or liabilities are settled. The tax rate is applied to the cumulative amounts of deductible and taxable temporary differences to measure<br />
the Deferred Tax Asset or Liability.<br />
Deferred Tax Assets are recognised for deductible temporary differences and unused tax losses only if it is probable that future taxable<br />
amounts will be available to utilise those temporary differences and losses.<br />
Deferred tax is charged or credited to the Income Statement, except where it relates to items charged or credited directly to equity, in<br />
which case the tax is dealt within equity.<br />
1.12 Borrowings<br />
Borrowings are initially recognised at their fair value. After initial recognition, all borrowings are measured at amortised cost using the<br />
effective interest method where this differs from face value.<br />
1.13 Derivative Financial Instruments<br />
<strong>Port</strong> <strong>Nelson</strong> uses derivative financial instruments such as interest rate swaps to hedge against interest rate fluctuations. <strong>Port</strong> <strong>Nelson</strong><br />
does not hold or issue derivative financial instruments for trading purposes. Such derivative financial instruments are stated at fair<br />
value. The fair value of interest rate swaps is determined by reference to market values. The effective portion of changes in the fair<br />
value of the derivative financial instruments that are designated and qualify as cash flow hedges are deferred in equity.<br />
If a hedging instrument is sold, terminated, revoked or no longer meets the criteria for hedge accounting, the cumulative gain or loss<br />
that remains recognised directly in equity from the period when the hedge was effective will be recognised in the Income Statement.<br />
1.14 Financing Costs<br />
Finance costs are recognised as an expense when incurred. Financing costs directly attributable to buildings under construction are<br />
capitalised as part of the cost of those assets.<br />
1.15 Employee Entitlements<br />
Provision is made in respect of the company’s liability for annual leave, long service leave and retirement gratuities. <strong>Annual</strong> leave and<br />
long service leave has been calculated on an actual entitlement basis at current rates of pay and retirement gratuities calculated at<br />
current rates of pay assuming the payment will be made upon retirement.<br />
1.16 Foreign Exchange Transactions<br />
Transactions in foreign currencies are converted at the New Zealand rate of exchange ruling at the date of the transaction. Capital items<br />
are converted at the exchange rate ruling at balance date or the forward exchange contract rate where applicable.<br />
1.17 Leases<br />
Leases of plant and equipment are classified as operating leases. Operating lease payments are charged as an expense in the period<br />
in which they are incurred, as this represents the pattern of benefits derived from the leased assets.<br />
1.18 Dividends<br />
Provision is made for the amount of any dividend declared on or before the end of the financial year but not distributed at balance<br />
date.<br />
1.19 Critical Judgements<br />
Management have not had to exercise any critical judgements in the period ending 30 June <strong>2007</strong>.<br />
C H A N G E S I N A C C O U N T I N G P O L I C I E S<br />
There have been no changes in accounting policies during the financial year.<br />
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