129.042 Mahitahi Hauora Annual Report 2024-25_Spreadsv07 - Flipbook - Page 41
Notes to the Financial Statements for the Year Ended - 30 June 2025
With the exception of services
in-kind, inflows of resources from
non-exchange transactions are only
recognised as an asset where both:
-
It is probable that the
associated future economic
bene昀椀t or service potential will
flow to the entity, and
-
Fair value is reliably
measurable.
Inflows of resources from
non-exchange transactions that are
recognised as assets are recognised
as non-exchange revenue, to
the extent that a liability is not
recognised in respect to the same
inflow.
The recognition of non-exchange
revenue depends on the nature of
any stipulations attached to the
inflow of resources received, and
whether this creates a liability (i.e.,
present obligation rather than the
recognition of revenue).
Stipulations that are ‘conditions’
speci昀椀cally require the Group to
return the inflow of resources
received if they are not utilised
in the way stipulated, resulting in
the recognition of a non-exchange
liability that is subsequently
recognised as non-exchange
revenue as and when the
‘conditions’ are satis昀椀ed.
Stipulations that are ‘restrictions’ do
not speci昀椀cally require the Group
to return the inflow of resources
received if they are not utilised in
the way stipulated, and therefore
do not result in the recognition of
a non-exchange liability, which
results in the immediate recognition
of non-exchange revenue.
(b) Interest income
Interest income is recognised as it
accrues using the effective interest
method.
(c) Employee bene昀椀ts
Short-term employee bene昀椀ts
liabilities are recognised when the
Trust has a legal or constructive
obligation to remunerate
employees for services provided
wholly within 12 months of the
reporting date, and is measured
on an undiscounted basis and
expensed in the period in which
employment services are provided.
(d) Financial Instruments
(i) Recognition and initial
measurement
Trade receivables issued are
initially recognised when they are
originated. All other 昀椀nancial assets
and 昀椀nancial liabilities are initially
recognised when the Trust becomes
a party to the contractual provisions
of the instrument.
A 昀椀nancial asset or 昀椀nancial
liability is initially measured at
fair value plus transaction costs
that are directly attributable to
its acquisition or issue. At initial
recognition, an entity may measure
short-term receivables and
payables at the original invoice
amount if the effect of discounting
is immaterial.
(ii) Classi昀椀cation and subsequent
measurement
Financial assets
On initial recognition, a 昀椀nancial
asset is classi昀椀ed as measured at:
amortised cost.
A 昀椀nancial asset is measured at
amortised cost if it meets both of
the following conditions:
- it is held within a management
model whose objective is to hold
assets to collect contractual cash
flows; and
- its contractual terms give rise
on speci昀椀ed dates to cash flows
that are solely payments of
principal and interest on the
principal amount outstanding.
Financial assets – Management
model assessment
The Trust’s cash and cash
equivalents, short term deposits,
and receivables (non-exchange)
are classi昀椀ed as 昀椀nancial assets
at amortised cost. GST and
prepayments are not included.
Cash and cash equivalents
represent highly liquid investments
that are readily convertible into
a known amount of cash with an
insigni昀椀cant risk of changes in
value, with original maturities of 3
months or less. Short term deposits
are those with an original maturity
of more than 3 months.
Financial assets – Subsequent
measurement and gains and
losses
Financial assets at amortised cost
- These assets are subsequently
measured at amortised cost using
the effective interest method
less impairment provision. The
amortised cost is reduced by
impairment losses. Interest income
and impairment are recognised in
surplus or de昀椀cit. Any gain or loss
on derecognition is recognised in
surplus or de昀椀cit.
Financial liabilities – Classi昀椀cation,
subsequent measurement and
gains and losses
All of the Trust’s 昀椀nancial liabilities
meet the criteria to be classi昀椀ed as
measured at amortised cost. These
昀椀nancial liabilities are subsequently
measured at amortised cost using
the effective interest method.
Interest expense is recognised in
surplus or de昀椀cit. Any gain or loss
on derecognition is also recognised
in surplus of de昀椀cit.
(iii) Derecognition
Financial assets
The Trust derecognises a 昀椀nancial
asset when the contractual rights
to the cash flows from the 昀椀nancial
asset expire, or it transfers the
rights to receive the contractual
cash flows in a transaction in
which substantially all of the risks
and rewards of ownership of the
昀椀nancial asset are transferred or in
which the Trust neither transfers
nor retains substantially all of the
risks and rewards of ownership
and it does not retain control of the
昀椀nancial asset.
Financial liabilities
The Trust derecognises a 昀椀nancial
liability when its contractual
obligations are discharged or
cancelled or expire. The Trust also
derecognises a 昀椀nancial liability
when its terms are modi昀椀ed and the
cash flows of the modi昀椀ed liability
are substantially different, in which
case a new 昀椀nancial liability based
on the modi昀椀ed terms is recognised
at fair value.
41.
