Annual Report 2010 - Royal New Zealand Ballet

Annual Report 2010\ 27NOTES TO THE FINANCIAL STATEMENTS(iv)Historical cost conventionThe financial statements are prepared under the historical cost convention.(b)Foreign currency translation(i)Functional and presentation currencyThe financial statements are presented in New Zealand dollars, which is the Ballet’sfunctional and presentation currency.(ii) Transactions and balancesForeign currency transactions are translated into New Zealand dollars using the exchangerates prevailing at the dates of the transactions. Foreign exchange gains and lossesresulting from the settlement of such transactions and from the translation at year endexchange rates of monetary assets and liabilities denominated in foreign currencies arerecognised in the statement of comprehensive income.(c)Revenue recognitionRevenue comprises the fair value for the sale of goods and services, excluding Goods andServices Tax, and rebates and discounts. Revenue is recognised as follows:(i) Sales of merchandise and costume hireSales are recognised when the Ballet has delivered a product to the customer. Salesare usually in cash or by credit card. The recorded revenue is the gross amount of sale,including credit card fees payable for the transaction. Such fees are included in otherexpenses.(ii) Interest incomeInterest income is recognised on a time proportion basis using the effective interestmethod.(iii)Grants and sponsorship incomeFunding is recognised in the statement of comprehensive income when the requirementsunder the agreement have been met. Any funding for which the requirements under theagreement have not been completed is termed deferred revenue and is carried as a liabilityuntil all the conditions have been fulfilled. Funding received from the Ministry for Cultureand Heritage is recognised in the statement of comprehensive income on a straight-linebasis to reflect the pattern of benefits received, unless any conditions are imposed on theBallet.