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notes to the financial Statements
for the year ended 31 March 2012
Deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries
and associates, and interests in joint ventures, except where the Group is able to control the reversal of the
temporary difference and it is probable that the temporary difference will not reverse in the foreseeable future.
The carrying amount of deferred tax assets is reviewed at each balance date and reduced to the extent that
it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be
recovered.
Deferred tax assets and liabilities are calculated at the tax rates that are expected to apply in the period when
the assets or liabilities giving rise to them are realised or settled. Deferred tax is charged or credited to profit or
loss, except when it relates to items charged or credited directly to other comprehensive income, in which case
the deferred tax is also dealt with in other comprehensive income (for example, asset revaluations).
Deferred tax assets and liabilities are offset when there is a legally enforceable right to off set current tax
assets against current tax liabilities and when they relate to income taxes levied by the same taxation
authority and the Group intends to settle its current tax assets and liabilities on a net basis.
i) Inventories
Inventories are stated at the lower of cost and net realisable value. Cost includes the cost of direct materials
and other charges, such as freight costs, that have been incurred in bringing the inventories to their present
location and condition. Cost is calculated using the weighted average method. Net realisable value represents
the estimated selling price less all estimated costs of completion and costs to be incurred in marketing, selling
and distribution.
j) Intangible assets
Software acquired separately is reported at cost less accumulated amortisation and accumulated impairment
losses. Amortisation is charged on a straight-line basis over their estimated useful lives. The estimated useful
life and amortisation method are reviewed at the end of each annual reporting period, with the effect of any
changes in estimate being accounted for on a prospective basis. The estimated useful lives of intangible assets
used in the calculation of amortisation is 1~7 years.
The cost of such intangible assets is their fair value at the acquisition date. Subsequent to initial recognition,
intangible assets acquired in a business combination are reported at cost less accumulated amortisation and
accumulated impairment losses.
Land easements, which grant access or allow network structures to exist over private land, have an indefinite
life because the right exists in perpetuity and are therefore not amortised. Land easements are tested annually
for impairment.
Resource consents include the rights to construct small hydro schemes. Resource consents for the hydro
scheme principally relate to the right to take and inject water. These rights are classified as having an indefinite
life and are tested for impairment annually.
k) Goodwill
Goodwill arising on the acquisition of a subsidiary or a jointly controlled entity represents the excess of
the cost of acquisition over the Group’s interest in the net fair value of the identifiable assets, liabilities
and contingent liabilities of the subsidiary or jointly controlled entity recognised at the date of acquisition.
Goodwill is initially recognised as an asset at cost and is subsequently measured at cost less any accumulated
impairment losses.
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