Vector Limited

Vector Limited

Overview of the company

Vector limited is New Zealand based company involved in Multi-Network Infrastructure. Company has been managing and owning a unique portfolio of energy and fibre optic infrastructure networks. Their main objective is to deliver energy and communication services to approximately more than one million people within New Zealand and across the globe (Vector Limited website).

Business Services

The main services provided by Vector Limited are as followed:

They Distribute Electricity

They Distribute and transmit Gas

Installations of Gas and electricity matering along with data management

They also provide service of Natural gas and LPG

They also has network of Fibre Optic that delivers high speed broadband services to the users

Ownership of Vector Limited

Company has been part of New Zealand Stock Exchange and was established in 1999 by a trust that was beneficiaries of Vector's electricity customers in Auckland. 75.1% shares have been owned by Auckland Energy Consumer Trust (AECT) (Vector Limited website).

Financial highlights

As the long term objective of the Vector Limited is to deliver reliable and sustainable return that is dividends to shareholders along with the company growth, this has been proved by the financial results of 2012. 2012 financial results were clearly showing evidence that company has been performing well considering their objectives and market condition. Dividend payout has been 1.8% in 2012 which has been increased from 2011 with 53%. As far as profit after tax is concern, in 2012 it was partial lower than 2011 along with Earning per share as well as EBIT to total income. Moreover, company operation has been expanded and investment has been increased and it is expected that within 2 years Vector Limited would be generating significant profits (Vector Limited Annual report, 2012).

Annual report of Vector Limited

The purpose of annual report is too offer shareholder and potential investor with the financial information i.e. financial health of the company and what are future growth possibilities. In order to formulate this annual, particular standard has been developed by accounting authorities so that any misinterpretation and other issues can be avoided.

Vector Limited annual report has been prepared in accordance with New Zealand Equivalent to International Accounting (Godfrey, Chalmers, 2012).

Accounting for Income Taxes of Vector Company: Income Taxes (NZ IAS 12)

Each company that is operating in New Zealand, they need to follow income tax rules developed by New Zealand Society of Accountants i.e. NZ IAS - 12: Accounting for Inter-period Allocation of Income Tax (1980) (New Zealand Equivalent to International Accounting Standard 12 Income Taxes)

Deferral Method is a method under which company follows the following rules:

Due to time difference, income tax is widely effected for the current period and formulating with the use of current rate of tax.

Due to time difference, income tax is widely affected from the previous period and repeal throughout the current period with use of current rate of tax that was originally applied.

In the balance sheet, deferred taxes already exit and this was not adjusted in order to reflect changes in the rate of income ...