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waikato-tainui
annual report 2014
irrevocable election to present gains and losses on that investment in other comprehensive income.
Financial assets are de‑recognised when the rights to receive cash flows from the financial assets have expired or have been
transferred and the Group has transferred substantially all risks and rewards of ownership. Financial liabilities are de‑recognised if
the Group’s obligations specified in the contract expire or are discharged or cancelled.
Investment property liabilities are classified as financial liabilities measured at fair value through profit or loss. Derivative
financial instruments are classified as either financial assets or financial liabilities measured at fair value through profit or loss.
2.16 Investments in subsidiaries
Investments in subsidiaries are valued at cost less impairment in the Parent.
2.17 Intangible assets
(a) Goodwill
Goodwill arises on the acquisition of subsidiaries, associates and joint ventures and represents the excess of the consideration
transferred over the Group’s interest in net fair value of the net identifiable assets, liabilities and contingent liabilities of the
acquiree and the fair value of the non‑controlling interest in the acquiree.
For the purpose of impairment testing, goodwill acquired in a business combination is allocated to each of the cash generating
units (CGUs), or groups of CGUs, which are expected to benefit from the synergies of the combination. Each unit or group of
units to which the goodwill is allocated represents the lowest level within the entity at which the goodwill is monitored for
internal management purposes.
Goodwill impairment reviews are undertaken annually or more frequently if events or changes in circumstances indicate a
potential impairment. The carrying value of goodwill is compared to the recoverable amount, which is the higher of value in use
and the fair value less costs to sell. Any impairment is recognised immediately as an expense and is not subsequently reversed.
(b) Computer software
Separately acquired computer software and licenses at a cost greater than $10,000 are capitalised on the basis of the costs
incurred to acquire and bring to use the specific asset. These costs are amortised on a straight line basis over their estimated
useful lives of two years.
Costs under $10,000 associated with maintaining computer software programmes are recognised as an expense as incurred.
(c) Quota
Separately acquired fishing quota has an indefinite useful life and will generate economic benefits beyond one year. Fishing
quota is tested annually for impairment and is carried at cost less accumulated impairment. The useful life is assessed annually
to determine whether the indefinite useful life assessment continues to be supportable.
(d) Carbon credits
Intangible assets include carbon credits acquired by way of a Government grant and are initially recognised at fair value at the
date of acquisition. Following initial recognition, these intangible assets are carried at cost less any accumulated
impairment losses.
The carbon Group is able to either hold the New Zealand Units (NZU) within the carbon register or alternatively trade the NZU’s
in domestic and international carbon markets.
Carbon credits are not consumed in the production and are therefore not amortised. The NZU are not amortised but are tested
for impairment on an annual basis or when indicators of impairment exist.
2.18 Property, plant and equipment
Farm and other properties are comprised of land, buildings and plant held on the farms as well as buildings occupied by the
Waikato Raupatu Lands Trust and Tainui Group Holdings Limited, a Group subsidiary, and are shown at fair value, based on
periodic, but at least triennial, valuations by external independent valuers, less subsequent depreciation. Any accumulated
depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset, and the net amount is
restated to the revalued amount of the asset.
