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2 S umm a r y o f s i g n i f i c a n t a c c o u n t i n g p o l i c i e s ( c on t i n u e d )
(c) Sales of goods
Sales of goods are recognised when the Group has transferred the significant risks and rewards of ownership of the goods sold.
For sections, recognition is on the sale contract becoming unconditional and the title passing. The recorded revenue is the gross
amount of the sale.
(d) Quota lease income
Quota lease income is recognised on a straight line basis over the lease term.
(e) Dairy income
Dairy income is recognised when the Group has transferred the significant risks and rewards of ownership of the goods sold.
(f) Interest income
Interest income is recognised on a time-proportion basis using the effective interest method. When a receivable is impaired, the
Group reduces the carrying amount to its recoverable amount, being the estimated future cash flow discounted at original effective
interest rate of the instrument, and continues unwinding the discount as interest income. Interest income on impaired loans is
recognised using the rate of interest used to discount the future cash flows for the purpose of measuring the impairment loss.
(g) Dividend income
Dividend income is recognised when the right to receive payment is established.
(h) Emission Trading Scheme Allocation
Emission Trading Scheme allocation is the assistance provided by the Government in the form of transfers of resources to the
Group in return for past or future compliance with certain conditions relating to operating activities of the Group. The Group was
eligible for and has received units under the New Zealand Emission Trading Scheme as part of the fisheries allocation for quota
owned. The fair value of units received is recognised in the statement of comprehensive income on allocation by the Government
to the Group.
2.7 Employee benefits
Liabilities are recognised for benefits accruing to employees in respect of wages and salaries, annual leave, and sick leave where it
is probable that settlement will be required and they are capable of being measured reliably.
Liabilities in respect of employee benefits expected to be settled within 12 months, are measured at their nominal values using the
remuneration rate expected to apply at the time of settlement.
Liabilities in respect of employee benefits which are not expected to be settled within 12 months are measured at the present value
of the estimated future cash outflows to be made by the Group in respect of services provided by employees up to reporting date.
The Group recognises a liability and an expense for bonuses based on a formula that takes into consideration the achievements of
agreed key performance indicators, including the achievement of financial budget targets. The Group recognises a provision where
contractually obliged or where there is a past practice that has created a constructive obligation.
2.8 Leases
Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating
leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the statement of
comprehensive income on a straight-line basis over the period of the lease.
2.9 Borrowing costs
Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time that is required to
complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed.
waikato raupatu lands trust
notes to the financial statements
f o r t h e y e a r e n d e d 3 1 m a r c h 2 0 1 5
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