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Note 28: Net Worth

Note 28: Net Worth
Forecast
30 June 2012 		Actual
Budget 11
$m 		Budget 12
$m 		30 June
2012
$m 		30 June
2011
$m
14,463 7,573 Taxpayer funds 3,520 18,188
63,614 62,618 Property, plant and equipment revaluation reserve 56,001 62,690
69 69 Investment revaluation reserve 71 58
(223) (276) Cash flow hedge reserve (195) (310)
(53) 11 Foreign currency translation reserve (49) (47)
402 308 Net worth attributable to minority interests 432 308
78,272 70,303 Total net worth 59,780 80,887

Taxpayer Funds

 
21,720 18,188 Opening taxpayers funds 18,188 31,087
(7,293) (10,642) Operating balance excluding minority interest (14,897) (13,360)
36 27 Transfers from/(to) property, plant and equipment revaluation reserve 228 460
-  -  Other movements 1 1
14,463 7,573 Closing taxpayer funds 3,520 18,188

Property, Plant and Equipment Revaluation Reserve

 
63,600 62,690 Opening revaluation reserve 62,690 63,593
-  (47) Net revaluations (6,461) (443)
14 (25) Transfers from/(to) taxpayer funds (228) (460)
63,614 62,618 Closing revaluation reserve 56,001 62,690

The property, plant and equipment revaluation reserve arises on the revaluation of physical assets. Where revalued property, plant or equipment is sold, the portion of the property, plant and equipment revaluation reserve that relates to that asset, and is effectively realised, is transferred to taxpayer funds.

Note 28: Net Worth (continued)
Forecast
30 June 2012 		Actual
Budget 11
$m 		Budget 12
$m 		30 June
2012
$m 		30 June
2011
$m

Investment Revaluation Reserve

 
63 58 Opening investment revaluation reserve 58 59
6 11 Increase arising on revaluation of available-for-sale financial   assets 12 (1)
-  -  Cumulative (gain)/loss transferred to the statement of financial  performance on sale of available-for-sale financial assets 1 - 
69 69 Closing investment revaluation reserve 71 58

The investment revaluation reserve arises on the revaluation of available-for-sale financial assets. Where a revalued financial asset is sold, the portion of the reserve that relates to that financial asset, and is effectively realised, is recognised in the statement of financial performance. Where a revalued financial asset is impaired, the portion of the reserve that relates to that financial asset is recognised in the statement of financial performance.

Note 28: Net Worth (continued)
Forecast
30 June 2012 		Actual
Budget 11
$m 		Budget 12
$m 		30 June
2012
$m 		30 June
2011
$m

Cash Flow Hedge Reserve

 
(219) (310) Opening cash flow hedge reserve (310) (143)
3 56 Transfer into reserve 80 (279)
-  -  Transfer to the statement of financial performance 54 17
(7) (22) Transfer to initial carrying value of hedged item (19) 95
(223) (276) Closing cash flow hedge reserve (195) (310)

The cash flow hedge reserve reports gains and losses in the value of derivatives entered into to reduce volatility in future cash flows. These gains and losses will either be used to adjust the cash flows as they occur, impacting either on the statement of financial performance if the cash flows relate to revenue or expenses, or the statement of financial position if the cash flows relate to assets or liabilities.

Note 28: Net Worth (continued)
Forecast
30 June 2012 		Actual
Budget 11
$m 		Budget 12
$m 		30 June
2012
$m 		30 June
2011
$m

Foreign currency translation reserve

 
(47) (47) Opening foreign currency translation reserve (47) (10)
(6) 58 Arising from translation of foreign operations (2) (37)
(53) 11 Closing foreign currency translation reserve (49) (47)

The foreign currency translation reserve holds foreign exchange gains and losses arising from translating monetary items that form part of the net investment in a foreign operation into New Zealand dollars. It also includes foreign exchange gains and losses associated with translating non-monetary assets into New Zealand dollars if revaluations of those assets are reflected in another reserve rather than in the statement of financial performance.

Note 28: Net Worth (continued)
Forecast
30 June 2012 		Actual
Budget 11
$m 		Budget 12
$m 		30 June
2012
$m 		30 June
2011
$m

Net Worth Attributable to Minority Interests

 
402 308 Opening minority interest 308 402
-  -  Operating balance attributable to minority interests 56 (101)
-  -  Transactions with minority interest 40 (20)
-  -  Other movements 28 27
402 308 Closing minority interest 432 308

Minority interest include the interests of minority holders of Air New Zealand shares. Transactions with minority interests include dividend payments and dividend reinvestments.

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