annual report 2005 - Pumpkin Patch investor relations

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Pumpkin Patch Limited & Subsidiaries statements of accounting policies for the 12 months ended 31 July 2005 foreign currencies transactions Transactions denominated in a foreign currency are converted to New Zealand dollars at the exchange rates in effect at the date of the transaction, except when forward currency contracts have been taken out to cover short-term forward currency commitments. Where short-term forward currency contracts have been taken out, the transaction is translated at the rate contained in the contract. Monetary assets and liabilities arising from trading transactions, such as inventory, trade debtors, cash and trade creditors, or overseas borrowings are translated at closing rates from the following currencies as at the financial period end: 31 July 2005 31 July 2004 Australian Dollar 0.8988 0.9076 US Dollar 0.6842 0.6424 British Pound 0.3896 0.3494 Gains and losses due to currency fluctuations on these items are included in the statement of financial performance. foreign operations The results of integrated foreign operations are translated in the same way as if the underlying transactions had been entered into by the reporting entity. Exchange differences arising from the translation of integrated foreign operation are recognised in the statement of financial performance. share schemes and employee ownership plans The company operates employee share ownership plans for certain employees. The initial purchase of shares by the scheme is funded by advances from the company, the advances being recognised as assets in the statement of financial position. Where shares are issued in lieu of bonus, the expense is recognised in the statement of financial performance. The company operates share schemes for certain executive employees. No compensation expense is recognised in the statement of financial performance. deferred landlord contributions Landlord contributions to fit-out costs are capitalised as deferred contributions and amortised to the statement of financial performance over the lesser of the minimum period of the lease or the useful life of the asset. property, plant and equipment The cost of purchased property, plant and equipment is the value of the consideration given to acquire the assets and the value of other directly attributable costs which have been incurred in bringing the assets to the location and condition necessary for their intended service. The cost of assets constructed by the Group includes the cost of all materials used in construction, direct labour on the project and financing costs that are directly attributable to the project. Costs cease to be capitalised as soon as the asset is ready for productive use. 28
Pumpkin Patch Limited & Subsidiaries statements of accounting policies for the 12 months ended 31 July 2005 depreciation Depreciation on property, plant and equipment, other than freehold land, has been calculated on a straight line basis so as to expense the cost of the assets to their residual values over their useful lives as follows: Shop Fit Out Office Equipment Point of Sale Equipment Computer Equipment & Software Motor Vehicles Plant and Machinery Furniture and Fittings Leasehold Improvements 3 – 10 years 3 – 10 years 3 years 3 – 5 years 4 – 5 years 2 – 14 years 3 – 10 years 6 – 7 years leased assets Operating lease payments are representative of the pattern of benefits derived from the leased assets and accordingly are charged to the statements of financial performance in the periods in which they are incurred. Landlord contributions to fit-out costs are recognised in the statements of financial performance over the minimum period of the lease, as a reduction in operating lease costs. investments Investments in subsidiaries are stated at the lower of cost or net realisable value. Other investments are stated at the lower of cost or net realisable value. intangibles The excess of cost over the fair value of the net assets of the subsidiary entities is recognised as goodwill and is amortised to the statements of financial performance on a straight line basis over the shorter of its estimated life or five years. Other intangibles comprise of the cost of registering trademarks. These are amortised over their anticipated useful lives which range between 5 and 10 years. inventories Raw materials and finished goods are stated at the lower of average weighted cost and net realisable value. Cost is determined on a first in, first out basis. accounts receivable Accounts receivable are carried at estimated realisable value after providing against debts where collection is doubtful. impairment Annually, the directors assess the carrying value of each asset. Where the estimated recoverable amount of the asset is less than its carrying amount, the asset is written down. The impairment loss is recognised in the statements of financial performance. employee entitlements Employee entitlements to salaries and wages, annual leave, long service leave and other benefits are recognised when they accrue to employees. The liability for employee entitlements is carried at the present value of the estimated future cash outflows. 29
Page 1 and 2: annual report 2005
Page 4 and 5: contents performance highlights 1 f
Page 6 and 7: financial highlights Year ended 31
Page 8 and 9: id culture
Page 10 and 11: id culture managing director’s re
Page 12 and 13: id culture United Kingdom retail 20
Page 14 and 15: ur team spirit! directors Greg Muir
Page 16 and 17: ur team spirit! senior management t
Page 19 and 20: corporate governance The Board of D
Page 21: external auditor independence To en
Page 24 and 25: directors shareholdings 31 July 200
Page 27 and 28: Pumpkin Patch Limited & Subsidiarie
Page 31: Pumpkin Patch Limited & Subsidiarie
Page 56 and 57: shareholder information for the yea
Page 59 and 60: corporate directory registered offi

annual report 2005 - Pumpkin Patch investor relations

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