IAS 1 para 97, separate disclosure of government assistance in relation to COVID – 19, airline

Air New Zealand Limited – Annual report – 30 June 2021

Industry: airlines

2. Expenses (extract)

Government grants and subsidies

Government grants and subsidies which compensate the Group for expenses incurred are recognised in the Statement of Financial Performance on a systematic basis over the period in which the related costs are recognised when they become unconditional. Grants and subsidies are reported on a net basis in the same line as the related expense.

Given the significant impact that Covid-19 has had on the New Zealand economy the New Zealand Government through the Ministry of Social Development provided wage subsidies for periods where there were alert level restrictions and businesses could demonstrate a decline in revenues as a result of the pandemic. Additional subsidies were received from other governments related to offshore offices including Australia, the United States of America, Singapore and the Cook Islands. The wage subsidies were recognised within Labour expenses as an offset to the underlying labour cost. Conditions attached to the government subsidies which have been recognised in the Statement of Financial Performance have been satisfied.

The New Zealand Government through the Ministry of Transport provided an aviation support package as a result of the impact of Covid-19 which included financial support to airlines to pay passenger-based government charges and Airways related fees. The package covered the period from 1 March 2020 through to 31 December 2020. All conditions associated with the government assistance have been satisfied.