Wednesday 19th January 2011
|Text too small?|
A change to international accounting rules will boost Kiwi Income Property Trust unit holders funds by about $214 million.
Trust manager Kiwi Income Properties said an amendment made by the International Accounting Standards Board would have an impact on an unintended consequence that arose out of the Government's decision this year to strike out depreciation allowances on building structures.
As a result of the change made by the Government, building owners, such as the trust, were required to provide for a deferred tax liability which would not crystallise even if the trust's properties were sold, the manager said.
For the trust, the accounting board's amendment would have the effect of reversing a one-off deferred tax liability of $143.9 million, with a corresponding decrease in deferred tax expense, recognised in the trust's financial statements for the six months to September.
That liability had arisen as a result of the removal of the depreciation deductions.
Also, previously recognised deferred tax liabilities in respect of unrealised revaluation gains and deductible capitalised costs of $69.9 million, as at September 30, would be reversed.
The net effect of those entries would be an increase in unit holders' funds of about $214m, with the adjustments to first be reflected in the trust's annual financial statements for the year ending March 2011.
Trust manager chief executive Chris Gudgeon said the accounting board had resolved the unintended consequence of the removal of depreciation on building structures.
As a result, the trust's financial statements for the year ending March 2011 would give investors a true indication of the trust's net tangible asset backing.
The Kiwi Income trust's property portfolio is valued at $2 billion. Among its assets are the Sylvia Park shopping centre in Auckland, North City shopping centre in Porirua, Northlands shopping centre in Christchurch, and high profile office buildings in Auckland, Wellington and Christchurch.
No comments yet
New Zealand Rural Land Company Limited (NZX: NZL) Agreement to acquire large scale dairy asset portfolio
EROAD Limited (NZX: ERD) launches Clarity Solo Dashcam
22nd October 2021 Morning Report
Pictor ready to roll out game-changing COVID antibody test in New Zealand
Scott Technology Limited (NZX: SCT) Announces FY21 Results
21st October 2021 Morning Report
Greenfern Industries Limited (NZX: GFI) L&Q Notice
TruScreen Group Limited (NZX: TRU) Clinical Trial Results Highlight Efficacy of TRU Technology
20th October 2021 Morning Report
Freightways Limited (NZX: FRE) Acquisition of ProducePronto