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No sweat, answered in a jumbled way. I haven't checked re the consolidated status. I recall there are a bunch of rules for govt around definitions eg SOEs have a special status. I am not sure on things like AIR etc on classification. It is a minor point. Also be aware that govt accounts do not comply with IFRS(pretty sure). The debt isn't linked to the financial asset. And lastly discount rates for govt do some other things too! With ACC(and defined benefit stuff like some pensions in and out of govt) higher discount rates are actually better. It is an actuary thing. Technically whatever assets they hold to meet liabilities generally making better returns because they tend to be bond/debt heavy, so higher rates(assuming whatever triggered higher disc rate is i rate related) better cash returns over lifetime of book.
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Interest is very low which needs to be factored in.
Plus we are paying it to ourselves given the RBNZ owns much of our "debt" (..or assets?).
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Then you have inflation of course eroding it by 6% this year alone.
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Originally Posted by Recaster
Thanks Dassets. I really didn't know what I was getting into with this. Pages and pages of notes to the financial statements which I really didn't get in to.
First attempt at analysing a government :-(.
To do it properly is a big project I now realise.
I get all that you are saying except the point about Mercury. Could you elaborate on that? Mercury would be consolidated at 51.15% ownership?
Also could you give an example of a financial asset which will fall in value while the debt remains the same?
I'll have another look at it with respect to the points you have made.
OBEGAL was a new one on me but it seems a better metric I agree.
Rising discount rates will certainly trim the froth off companies.
Thanks for taking the time to look at it. Cheers.
haha - I know what you mean recaster
sometimes I think something looks interesting and I start popping numbers into a spreadsheet wanting to do a back of the envelope calc. Next minute I've spent hours in a spreadsheet wishing I hadn't started in the first place. got more than a few unfinished workbooks where I got ground down and semi gave up
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Yep, I know that feeling lol.
Just pottering away on the NZ Govt at the moment. Found what the commitments are (thanks Dassets) so will integrate those and some more stuff as I get it done :-). Cheers.
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