Air New Zealand 2016 Annual Report Download - page 15

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Notes to the Financial Statements (continued)
As at 30 June 2016
13
AIR NEW ZEALAND GROUPAIR NEW ZEALAND GROUP
8. Inventories
Inventories are measured at the lower of cost and net realisable value. Cost is determined using the first-in, first-out (FIFO)
cost method. Net realisable value is the estimated selling price in the ordinary course of business, less applicable variable
selling expenses.
2016
$M
2015
$M
Engineering expendables
Consumable stores
86
17
107
13
103 120
Held at cost
Held initially at cost
Less provision for inventory obsolescence
84
75
(56)
88
82
(50)
Held at net realisable value 19 32
103 120
9. Investment in Quoted Equity Instruments
Investments in quoted equity instruments are stated at fair value. Changes in the fair value of the investment in quoted equity
instruments, including any related foreign exchange component, are recognised through profit or loss unless an irrevocable
election has been made at inception to recognise these through other comprehensive income.
2016
$M
2015
$M
Investment in Virgin Australia Holdings Limited:
Current
Balance at the beginning of the year
Transfer from investments in associates
Fair value changes recognised in profit or loss
Disposals
-
382
(79)
(281)
-
-
-
-
Balance at the end of the year 22 -
Further details of the Group’s investment in Virgin Australia are contained within Note 3.
The investment has been classified as a current asset as it is the Group’s intention to dispose of the investment within the next 12 months.
On 4 August 2016 the Group participated in a Virgin Australia 1 for 1 pro-rata rights issue and acquired an additional 102,889,330 shares for
A$0.21 per share. Following the rights issue the Group’s interest in Virgin Australia was retained at 2.5%.
7. Trade and Other Receivables
Trade and other receivables are recognised at cost less any provision for impairment. Bad debts are written-off when they are
considered to have become uncollectable.
2016
$M
2015
$M
Current
Trade and other receivables
Prepayments
300
73
298
71
373 369
Non-current
Other receivables
Prepayments
2
59
3
48
61 51