2006-2007 : Page 44
auckland war memorial museum 2006 |2007 FINANCIAL INSTRUMENTS Financial instruments in the Statement of Financial Position include cash and bank, investments, accounts receivable and accounts payable.The particular recognition methods adopted are disclosed in the individual statements associated with each item. The Museum has financial instruments with off balance sheet risk for the primary purpose of reducing its exposure to fluctuations in foreign currency exchange rates. Forward exchange contracts that are designated as cash flow hedges are valued at the exchange rates prevailing at year end. Any unrealised gains or losses are recognised in the Statement of Financial Performance. CASH FLOW The Statement of Cash Flow is prepared exclusive of GST, which is consistent with the method used in the Statement of Financial Performance. Definitions of the terms used in the statement of cash flows: Cash includes coins and notes, demand deposits and other highly liquid investments readily convertible into cash and includes at call borrowings such as bank overdrafts, used by the Museum as part of day-to-day cash management. Investing activities are those activities relating to the acquisition and disposal of current and non-current investments and other non-current assets. Financing activities are those activities relating to changes in the equity and debt capital structure of the Museum and those activities relating to the cost of servicing the Museum's equity capital. Operating activities include all transactions and other events that are not investing or financing activities. GOODS AND SERVICES TAX (GST) All items in the Statement of Financial Performance are stated exclusive of GST. All items in the Statement of Financial Position are stated exclusive of GST, except receivables and payables, which include GST invoiced. COMPARATIVE FIGURES Comparative figures have been restated to align with the current year presentation. CHANGES IN ACCOUNTING POLICIES To comply with accounting standards, the cost of acquisition of heritage assets and the fair value of gifts since 1 July 2002 is now capitalised.Previously it was expensed. Comparative figures have not been restated to comply with this policy,and the effect has been reflected within the current year Statement of Financial Performance. There have been no other changes in accounting policy during the year.