annual report - Harvey Norman Company Reports & Announcements

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES
1. Statement of Significant Accounting Policies
(a) Corporate Information
Harvey Norman Holdings Limited (the “Company”) is a company limited by shares incorporated in Australia and operating
in Australia, New Zealand, Ireland, Northern Ireland, Singapore, Malaysia, Slovenia and Croatia whose shares are publicly
traded on the Australian stock exchange (trading under the symbol HVN).
(b) Basis of Preparation
The financial report has been prepared on a historical cost basis, except for investment properties, completed land and
buildings, derivative financial instruments, listed shares held for trading and available-for-sale investments, which have been
measured at fair value. The carrying values of recognised assets and liabilities that are hedged items in fair value hedges,
and are otherwise carried at cost, are adjusted to record changes in the fair values attributable to the risks that are being
hedged.
The financial report is presented in Australian dollars and all values are rounded to the nearest thousand dollars ($‟000)
unless otherwise stated under the option available to the Company under ASIC Class Order 98/0100. The Company is an
entity to which the class order applies.
The financial report of the consolidated entity for the year ended 30 June 2012 was authorised for issue in accordance with
a resolution of the directors on 28 September 2012.
(c) Statement of Compliance
The financial report is a general-purpose financial report, which has been prepared in accordance with the requirements of
the Corporations Act 2001, Australian Accounting Standards and interpretations, and complies with other requirements of
the law. The financial report complies with Australian Accounting Standards, as issued by the Australian Accounting
Standards Board, and International Financial Reporting Standards (IFRS), as issued by the International Accounting
Standards Board.
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet effective
have not been adopted by the consolidated entity for the annual reporting period ended 30 June 2012. For details on the
impact of future accounting standards, refer to page 69.
(d) Summary of Significant Accounting Policies
(i) Significant accounting judgements, estimates and assumptions
Significant Accounting Judgements:
In applying the consolidated entity‟s accounting policies management continually evaluates judgments, estimates and
assumptions based on experience and other factors, including expectations of future events that may have an impact on
the consolidated entity. All judgments, estimates and assumptions made are believed to be reasonable based on the most
current set of circumstances available to management. Actual results may differ from the judgments, estimates and
assumptions. Revision to accounting estimates are recognised in the period in which the estimate is revised if the revision
affects only that period. Significant judgments, estimates and assumptions made by management in the preparation of
these financial statements are outlined below:
Operating lease commitments – consolidated entity as lessor
The entity has entered into commercial property leases on its investment property portfolio. The entity has determined that
it retains all the significant risks and rewards of ownership of these properties and has thus classified the leases as operating
leases.
Recovery of deferred tax assets
Deferred tax assets are recognised for deductible temporary differences as management considers that it is probable that
future taxable profits will be available to utilise those temporary differences.
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