Air New Zealand 2008 Annual Report Download - page 8

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ENTITIES REPORTING
The financial statements presented are those of Air New Zealand Limited (the Company) and its subsidiaries and associates (the Group). References to
“Air New Zealand” are used where the Group and Company are similarly affected.
Air New Zealand’s primary business is the transportation of passengers and cargo on scheduled airline services.
STATUTORY BASE
Air New Zealand Limited is a company domiciled in New Zealand, registered under the Companies Act 1993 and listed on the New Zealand and
Australian Stock Exchanges. The Company is an issuer under the Financial Reporting Act 1993.
BASIS OF PREPARATION
Air New Zealand prepares its financial statements in accordance with New Zealand Generally Accepted Accounting Practice (“NZ GAAP”). NZ GAAP consists
of New Zealand equivalents to International Financial Reporting Standards (“NZ IFRS”) and other applicable financial reporting standards as appropriate to
profit-oriented entities. Compliance with NZ IFRS ensures that the financial statements also comply with International Financial Reporting Standards (“IFRS”).
These financial statements comply with NZ IFRS and IFRS. Air New Zealand adopted NZ IFRS on 1 July 2007 and is a profit-oriented entity.
These are Air New Zealand’s first annual financial statements, prepared in accordance with NZ IFRS. NZ IFRS 1: First-time adoption of NZ IFRS has
been applied. NZ IFRS 1 requires the opening balance sheets to be prepared in accordance with the accounting policies used in preparation of the
annual financial statements for the year ending 30 June 2008. An explanation of how the transition to NZ IFRS has affected reported equity as at
1 July 2006 (transition date) and 30 June 2007 and earnings for the year to 30 June 2007 is provided in note 28.
The financial statements were approved by the Board of directors on 26 August 2008.
Basis of measurement
The financial statements have been prepared on the historical cost basis, with the exception of certain items as identified in specific accounting policies
below and are presented in New Zealand Dollars which is the Company’s functional currency.
Use of accounting estimates and judgements
The preparation of financial statements requires the use of certain critical accounting estimates. It also requires the directors to exercise their judgement
in the process of applying the Group’s accounting policies. Estimates and associated assumptions are based on historical experience and other factors,
as appropriate to the particular circumstances. Areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates
are significant to the financial statements are disclosed under the applicable accounting policies below, in particular:
Note 3: Derivative financial instruments
Note 10: Property, plant and equipment
Note 15: Provisions
Note 16: Financial instruments
Note 20: Issued capital
Note 24: Contingent liabilities
Note 25: Retirement benefit obligations
SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied
to all periods presented, unless otherwise stated.
Comparative information has been reclassified to achieve consistency in disclosure with the current period. Reclassifications were made within the
Company’s financial statements between “Income taxation” (within current liabilities) and “Amounts owing to subsidiaries” (within current other liabilities)
of $183 million as at 1 July 2006 (transition date), and between “Income taxation” (within current liabilities) and “Income taxation” (within current assets)
of $113 million as at 30 June 2007.
Air New Zealand has elected to early adopt all NZ IFRSs and Interpretations that had been issued by the New Zealand Financial Reporting Standards
Board as at 30 June 2008, except as noted below. With the exception of NZ IFRIC 13: Customer Loyalty Programmes (refer to the specific accounting
policy on loyalty programmes below), the early adoption did not have a material impact on the financial statements.
NZ IAS 1: Presentation of Financial Statements (revised) has not been adopted early. This Standard is applicable for periods commencing on or after
1 January 2009 and would result in presentational changes only.
AIR NEW ZEALAND
STATEMENT OF ACCOUNTING POLICIES
6