FINANCIAL STATEMENTS CONTINUED
5. Accounting standards, interpretations and
amendments in issue not yet eff ective
nZ IfrS 9 Financial Instruments
is eff ective for annual reporting periods beginning on or after 1 January 2015. The Group is therefore required to adopt this standard by 30 June 2016. The standard is not expected to have a material impact on the Group’s fi nancial statements. nZ IfrS 10 Consolidated Financial Statements is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 10 introduces a single basis for consolidation for all entities regardless of the type of investment it is. The standard is not expected to have a material impact on the Group’s fi nancial statements. nZ IfrS 11 Joint Arrangements
is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 11 classifi es joint arrangements as either joint operations or joint ventures. nZ IfrS 11 requires joint operators to recognise assets, liabilities, revenue and expenses in relation to their interests in the joint operation whereas joint ventures are required to be accounted for using the equity
method. The initial assessment by the Group indicates that the jointly controlled assets and entities held by the Group (refer to note 26) are likely to be classifi ed as joint operations under nZ IfrS 11 and hence the standard is unlikely to have a material impact on the Group’s fi nancial statements.
nZ IfrS 12 Disclosure of Interests in Other Entities is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 12 introduces extensive new disclosure requirements. The Group has yet to determine the impact this standard will have on the fi nancial statement disclosures.
nZ IfrS 13 Fair Value Measurement is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 13 establishes a single framework for measuring fair value which it applies to both fi nancial and non-fi nancial items measured at fair value. It also introduces a number of new disclosure requirements. The Group has two categories of assets and liabilities carried at fair value being generation assets and derivatives. The Group has yet to determine the impact this standard will have on these balances and associated disclosures. all other standards,
interpretations and amendments approved but not yet eff ective in the current year are either not applicable to the Group or are not expected to have a material impact on the Group’s fi nancial statements and therefore have not been discussed.
2. Summary of accounting policies continued 6. Segment reporting
for management purposes, the Group is currently organised into four segments as follows:
Segment Activity
Customer experience Supply of energy (electricity, gas and LPG) to end-user customers as well as related services. energy management Generation and trading of electricity and related products. The segment includes electricity sales to
the wholesale electricity market, derivatives entered into to fi x the price of electricity, and wholesale gas and coal sales.
Oil and gas exploration, development, production and sale of gas, LPG and light oil.
Corporate head offi ce functions including new generation investigation and development, fuel management, information systems, human resources, fi nance, corporate relations, property management, legal, corporate governance and the fi nance lease receivable relating to the Kinleith cogeneration plant. Corporate revenue is made up of fi nance lease income, property rental and miscellaneous income. The segments are based on the diff erent products and services off ered by the Group. no operating segments have been aggregated.
Group
Year ended 30 JUne 2013
Customer experience
$000
Energy management
$000 Oil and gas$000 Corporate$000
Inter- segment items $000 $000Total Operating revenue electricity revenue 1,115,418 1,120,523 – – (492,067) 1,743,874 Gas revenue 124,669 133,393 46,788 – (92,383) 212,467 Petroleum revenue – – 80,516 – – 80,516 Other revenue 2,848 8,984 18,714 2,824 – 33,370 Total revenue 1,242,935 1,262,900 146,018 2,824 (584,450) 2,070,227 Operating expenses
electricity purchase, transmission and distribution (947,776) (464,265) – – 492,067 (919,974)
Gas purchase and transmission (111,724) (154,278) – – 48,791 (217,211)
Petroleum production, marketing and distribution – – (31,501) – – (31,501)
fuel consumed – (303,526) 51 – 43,592 (259,883)
employee benefits (24,964) (34,120) (7) (24,460) – (83,551)
Other operating costs (117,540) (83,319) (5,386) (15,413) – (221,658)
Earnings before net fi nance expense, income tax, depreciation, depletion, amortisation, impairment, fair value changes and other gains
and losses 40,931 223,392 109,175 (37,049) – 336,449
depreciation, depletion and amortisation (3,990) (77,891) (40,387) (12,696) – (134,964)
Impairment of non-current assets (2,346) (4,233) – – – (6,579)
revaluation of generation assets – 1,006 – – – 1,006
Change in fair value of financial instruments – 33,497 (2,573) (472) – 30,452
Other gains (losses) – (1,455) 49 (147) – (1,553)
Profi t (loss) before net fi nance expense and
income tax 34,595 174,316 66,264 (50,364) – 224,811
finance revenue 135 – 121 485 – 741
finance expense (248) (2,908) (2,491) (73,608) – (79,255)
Profi t (loss) before income tax 34,482 171,408 63,894 (123,487) – 146,297
Other segment information
defi nition of cash. dividends and interest paid in relation to the capital structure are included in fi nancing activities.
Taxation credits (debits) disclosed in operating activities include the net amount of GST paid/received during the year and net advances and loans to subsidiaries disclosed in investing activities include the net amount paid/ received during the year. GST and advances and loans to subsidiaries are disclosed on a net basis as the gross amounts do not provide meaningful information for fi nancial statement purposes.
(v) Capital and reserves
Asset revaluation reserve
The asset revaluation reserve is used to record movements in the fair value of generation assets in accordance with the property, plant and equipment accounting policy.
Cash fl ow hedging reserve
The cash fl ow hedge reserve comprises the eff ective portion of the cumulative net change in the fair value of cash fl ow
hedging instruments related to hedge transactions that have not yet occurred.
(w) Dividends
Provision is made for the amount of dividends declared on or before the end of the fi nancial year but not distributed at balance date.
3. Prior period adjustment
The comparative results for the Group and Parent have been restated for a prior period error relating to Wholesale contract revenues that were misstated. The error was detected during the current fi nancial year and, in accordance with the requirements stated in nZ IaS 8 ‘accounting Policies, Changes in accounting estimates and errors’ certain comparative fi gures have been restated as shown below. The error had the eff ect of overstating the Group and Parent’s profi t for the previous year. The error has been corrected by restating for each aff ected fi nancial statement line item the prior period presented as described below.
Group and Parent 2012 $000
Impact on profi t:
(decrease) in electricity revenue (5,356)
decrease in income tax expense 1,500
net (decrease) in profit for the year (3,856)
Represented by changes in the following balance sheet line items:
(decrease) in cash and cash equivalents (5,356)
decrease in tax payable 1,500
net (decrease) in total equity (3,856)
Impact on cash fl ow statement:
net (decrease) in receipts from customers (5,356) (decrease) in cash and cash equivalents
at 30 June 2012 (5,356)
The corresponding notes have also been restated to refl ect the changes above.
NOTES TO THE
FINANCIAL STATEMENTS
CONTINUED4. Adoption of new and revised accounting standards, interpretations and amendments
There have been no new and revised accounting standards, interpretations or amendments eff ective during the year which have a material impact on the Group’s accounting policies or disclosures.
5. Accounting standards, interpretations and amendments in issue not yet eff ective
nZ IfrS 9 Financial Instruments
is eff ective for annual reporting periods beginning on or after 1 January 2015. The Group is therefore required to adopt this standard by 30 June 2016. The standard is not expected to have a material impact on the Group’s fi nancial statements. nZ IfrS 10 Consolidated Financial Statements is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 10 introduces a single basis for consolidation for all entities regardless of the type of investment it is. The standard is not expected to have a material impact on the Group’s fi nancial statements. nZ IfrS 11 Joint Arrangements
is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 11 classifi es joint arrangements as either joint operations or joint ventures. nZ IfrS 11 requires joint operators to recognise assets, liabilities, revenue and expenses in relation to their interests in the joint operation whereas joint ventures are required to be accounted for using the equity
method. The initial assessment by the Group indicates that the jointly controlled assets and entities held by the Group (refer to note 26) are likely to be classifi ed as joint operations under nZ IfrS 11 and hence the standard is unlikely to have a material impact on the Group’s fi nancial statements.
nZ IfrS 12 Disclosure of Interests in Other Entities is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 12 introduces extensive new disclosure requirements. The Group has yet to determine the impact this standard will have on the fi nancial statement disclosures.
nZ IfrS 13 Fair Value Measurement is eff ective for annual reporting periods beginning on or after 1 January 2013. The Group is therefore required to adopt this standard by 30 June 2014. nZ IfrS 13 establishes a single framework for measuring fair value which it applies to both fi nancial and non-fi nancial items measured at fair value. It also introduces a number of new disclosure requirements. The Group has two categories of assets and liabilities carried at fair value being generation assets and derivatives. The Group has yet to determine the impact this standard will have on these balances and associated disclosures. all other standards,
interpretations and amendments approved but not yet eff ective in the current year are either not applicable to the Group or are not expected to have a material impact on the Group’s fi nancial statements and therefore have not been discussed.
2. Summary of accounting policies continued 6. Segment reporting
for management purposes, the Group is currently organised into four segments as follows:
Segment Activity
Customer experience Supply of energy (electricity, gas and LPG) to end-user customers as well as related services. energy management Generation and trading of electricity and related products. The segment includes electricity sales to
the wholesale electricity market, derivatives entered into to fi x the price of electricity, and wholesale gas and coal sales.
Oil and gas exploration, development, production and sale of gas, LPG and light oil.
Corporate head offi ce functions including new generation investigation and development, fuel management, information systems, human resources, fi nance, corporate relations, property management, legal, corporate governance and the fi nance lease receivable relating to the Kinleith cogeneration plant. Corporate revenue is made up of fi nance lease income, property rental and miscellaneous income. The segments are based on the diff erent products and services off ered by the Group. no operating segments have been aggregated.
Group
Year ended 30 JUne 2013
Customer experience
$000
Energy management
$000 Oil and gas$000 Corporate$000
Inter- segment items $000 $000Total Operating revenue electricity revenue 1,115,418 1,120,523 – – (492,067) 1,743,874 Gas revenue 124,669 133,393 46,788 – (92,383) 212,467 Petroleum revenue – – 80,516 – – 80,516 Other revenue 2,848 8,984 18,714 2,824 – 33,370 Total revenue 1,242,935 1,262,900 146,018 2,824 (584,450) 2,070,227 Operating expenses
electricity purchase, transmission and distribution (947,776) (464,265) – – 492,067 (919,974)
Gas purchase and transmission (111,724) (154,278) – – 48,791 (217,211)
Petroleum production, marketing and distribution – – (31,501) – – (31,501)
fuel consumed – (303,526) 51 – 43,592 (259,883)
employee benefits (24,964) (34,120) (7) (24,460) – (83,551)
Other operating costs (117,540) (83,319) (5,386) (15,413) – (221,658)
Earnings before net fi nance expense, income tax, depreciation, depletion, amortisation, impairment, fair value changes and other gains
and losses 40,931 223,392 109,175 (37,049) – 336,449
depreciation, depletion and amortisation (3,990) (77,891) (40,387) (12,696) – (134,964)
Impairment of non-current assets (2,346) (4,233) – – – (6,579)
revaluation of generation assets – 1,006 – – – 1,006
Change in fair value of financial instruments – 33,497 (2,573) (472) – 30,452
Other gains (losses) – (1,455) 49 (147) – (1,553)
Profi t (loss) before net fi nance expense and
income tax 34,595 174,316 66,264 (50,364) – 224,811
finance revenue 135 – 121 485 – 741
finance expense (248) (2,908) (2,491) (73,608) – (79,255)
Profi t (loss) before income tax 34,482 171,408 63,894 (123,487) – 146,297
Other segment information
Capital expenditure 5,402 145,576 3,091 13,114 – 167,183