Air New Zealand 2014 Annual Report Download - page 24

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AIR NEW ZEALAND ANNUAL FINANCIAL RESULTS 201422
12. INTANGIBLE ASSETS
GROUP
2014
$M
GROUP
2013
$M
COMPANY
2014
$M
COMPANY
2013
$M
Intangible assets comprise:
Internally developed software
Externally purchased software
Development costs
Goodwill
72
6
-
1
59
7
2
1
70
5
-
1
55
7
-
-
79 69 76 62
INTERNALLY DEVELOPED SOFTWARE
Cost
Accumulated amortisation
174
(115 )
150
(101)
167
(112 )
143
(99)
Carrying value at the beginning of the year
Additions
Amortisation
Net foreign currency exchange differences
59
34
(21)
-
49
26
(15)
(1)
55
35
(20)
-
44
26
(15)
-
Carrying value at the end of the year 72 59 70 55
Represented by:
Cost
Accumulated amortisation
205
(133)
174
(115 )
199
(129)
167
(112 )
Carrying value at the end of the year 72 59 70 55
EXTERNALLY PURCHASED SOFTWARE
Cost
Accumulated amortisation
Provision for impairment
166
(159)
-
173
(160)
(2)
161
(154)
-
165
(155)
-
Carrying value at the beginning of the year
Additions
Disposals from business combinations
Amortisation
7
3
-
(4)
11
1
(1)
(4)
7
2
-
(4)
10
1
-
(4)
Carrying value at the end of the year 6 7 5 7
Represented by:
Cost
Accumulated amortisation
165
(159)
166
(159)
159
(154)
161
(154)
Carrying value at the end of the year 6 7 5 7
Development costs arise from the Group’s engineering activities and will be applied to external customer products and services.
An impairment provision of $1 million was recognised during the year (30 June 2013: Nil). There were no additions in the year ended
30 June 2014 (30 June 2013: Nil).
13. INVESTMENT IN QUOTED EQUITY INSTRUMENTS
GROUP
2014
$M
GROUP
2013
$M
COMPANY
2014
$M
COMPANY
2013
$M
Investment in Virgin Australia Holdings Limited
Balance at the beginning of the year
Acquisitions
Fair value changes recognised in other comprehensive income
Transaction costs
261
179
(18)
-
203
62
(6)
2
-
-
-
-
-
-
-
-
Balance at the end of the year 422 261 - -
During the year, the Group acquired a further ownership interest in Virgin Australia Holdings Limited (Virgin Australia) at a cost of
A$160 million, taking the ownership interest to 25.99% (30 June 2013: acquisitions of A$45 million (excluding transaction costs)
resulting in an ownership interest of 19.99%). As at 30 June 2014 Air New Zealand treated the investment as an investment in
quoted equity instruments, rather than an equity accounted associate, as the directors considered that the Group did not have the
ability to exercise significant influence over Virgin Australia due to the composition of other shareholdings and lack of representation
on the Board.
On 4 July 2014, the Chief Executive Officer of Air New Zealand was appointed to the Board of Directors of Virgin Australia which
demonstrates, from an accounting perspective, that the Group is able to exercise significant influence going forward. Accordingly, the
investment will be treated as an associate for the financial year ended 30 June 2015 and the equity method of accounting applied.
Revaluation losses accumulated in the Investment Revaluation Reserve will be transferred to Retained Deficit at the date of gaining
significant influence.
NOTES TO THE FINANCIAL STATEMENTS (CONTINUED)
AS AT 30 JUNE 2014