26 Annual Report
For assets not carried at revalued amount, the total impairment loss is
recognised in the statement of financial performance.
The reversal of an impairment loss on a revalued asset is credited to the
revaluation reserve. However, to the extent that an impairment loss for
that class of asset was previously recognised in the statement of financial
performance, a reversal of the impairment loss is also recognised in the
statement of financial performance.
For assets not carried at a revalued amount the reversal of an impairment
loss is recognised in the statement of financial performance.
Financial instruments
The Law Commission is a party to financial instruments as part of its
normal operations. These financial instruments include bank accounts,
short-term deposits, debtors and creditors. All financial instruments are
recognised in the statement of financial position and all revenue and
expenses in relation to financial instruments are recognised in the
statement of financial performance. All financial instruments are shown
at their estimated fair value.
Creditors and other payable
Creditors and other payables are measured at fair value.
Employee entitlements
Short term employee entitlements
Employee entitlements that the Commission expects to be settled within
12 months of balance date are measured at undiscounted nominal values
based on accrued entitlements at current rates of pay. These include
salaries and wages accrued up to balance date, annual leave earned but
not yet taken at balance date and sick leave.
The Commission recognises a liability for sick leave to the extent that
compensated absences in the coming year are expected to be greater
that the sick leave entitlements earned in the same year. The amount is
calculated based on the unused sick leave entitlement that can be carried
forward at balance date to the extent that the Commission anticipated
it will be used by staff to cover those future absences.
Superannuation schemes
Obligations for contributions to KiwiSaver and the New Zealand
Government Superannuation Fund are accounted for as defined
contribution superannuation schemes and are recognised as an expense
in the statement of financial performance as incurred.