129.037 Mahitahi Hauora Annual Report 2023-24 v8 - Low Res Spreads - Flipbook - Page 44
Notes to the Financial Statements for the Year Ended - 30 June 2024
ii. Revenue from non-exchange
transactions
Non-exchange transactions as
detailed in note 6, are those where
the Trust receives an inflow of
resources (i.e. cash and other
intangible items) but provides no
(or nominal) direct consideration in
return.
Note 6 Income from General
Practices - this revenue is
considered as non-exchange, it is
an agreed amount charged to the
general practices based on their
patient numbers at a certain date to
cover only a portion of their costs.
With the exception of services
in-kind, inflows of resources from
non-exchange transactions are only
recognised as an asset where both:
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 nonexchange 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.
Liabilities are recognised in relation
to inflows of resources from nonexchange transactions when there
is a resulting present obligation
as a result of the non-exchange
transactions, where both:
- It is probable that an outflow
of resources embodying future
economic bene昀椀t or service
potential will be required to settle
the obligation, and
- The amount of the obligation can
be reliably estimated.
(b) Interest income
Interest income is recognised as it
accrues using the effective interest
method.
44.
(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 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.
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 and foreign
exchange gains and losses are
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.
