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Business valuations
We offer expert valuation advice in transactions, regulatory and administrative matters, and matters subject to dispute – valuing businesses, shares and intangible assets in a wide range of industries.
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Capital markets
You need corporate finance specialists experienced in international capital markets on your side if you’re buying or selling financial securities.
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Complex and international services
Our experience of multi-jurisdictional insolvencies coupled with our international reputation allows us to deliver the best possible outcome for all stakeholders.
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Corporate insolvency
Our corporate investigation and recovery teams can help you manage insolvency situations and facilitate the best outcome.
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Debt advisory
An optimal funding structure for your organisation presents unprecedented opportunities, but achieving this can be difficult without a trusted advisor.
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Expert witness
Our expert witnesses analyse, interpret, summarise and present complex financial and business-related issues which are understandable and properly supported.
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Financial models
A sound financial model will help you understand the impact of your decisions before you make them. Talk to us about our user-friendly models.
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Forensic and investigation services
We provide investigative accounting and litigation support services for commercial, matrimonial, criminal, business valuation and insurance disputes.
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Independent business review
Is your business viable? Will it remain viable in the future? A thorough independent business review can help your organisation answer these fundamental questions.
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IT forensics
Effective ESI analysis is integral to the success of your business. Our IT forensics experts have the technical expertise to identify, preserve and interrogate electronic data.
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Mergers and acquisitions
Grant Thornton provides strategic and execution support for mergers, acquisitions, sales and fundraising.
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Raising finance
Raising finance - funders value partners who can deliver a robust financial model, a sound business strategy and rigorous planning. We can guide you through the challenges that these transactions can pose and help you build a foundation for long term success once the deal is done.
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Relationship property services
Grant Thornton offers high quality independent advice on the many financial issues associated with relationship property from considering an individual financial issue to all aspects of a complex settlement.
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Restructuring and turnaround
Grant Thornton’s restructuring and turnaround service capabilities include cash flow, liquidity management and forecasting; crisis and interim management; financial advisory services to companies and parties in transition and distress
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Transaction advisory
Our depth of market knowledge will steer you through the transaction process. Grant Thornton’s dynamic teams offer range of financial, commercial and operational expertise.
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Virtual asset advisory
Helping you navigate the world of virtual currencies and decentralised financial systems.
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Corporate tax
Grant Thornton can identify tax issues, risks and opportunities in your organisation and implement strategies to improve your bottom line.
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Employment tax
Grant Thornton’s advisers can help you with PAYE (payroll tax), Kiwisaver, fringe benefits tax (FBT), student loans, global mobility services, international tax
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Global mobility services
Our team can help expatriates and their employers deal with tax and employment matters both in New Zealand and overseas. With the correct planning advice, employee allowances and benefits may be structured to avoid double taxation and achieve tax savings.
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GST
GST has the potential to become a minefield and can be expensive when it goes wrong. Our technical knowledge can help you minimise the negative impact of GST
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International tax
International tax rules are undergoing their biggest change in a generation. Tax authorities around the world are increasingly vigilant, especially when it comes to global operations.
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Research and Development
R&D tax incentives are often underused and misunderstood – is your business maximising opportunities for making claims?
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Tax compliance
Our advisers help clients manage the critical issue of compliance across accountancy regulations, corporation law and tax. We also offer business and wealth advisory services, which means we can provide a seamless and tax-effective offering to our clients.
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Tax governance
Mitigate tax risks and implement best practice governance that will stand up to IRD scrutiny and audits.
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Transfer pricing
Tax authorities are demanding transparency in international arrangements. We businesses comply with regulations and use transfer pricing as a strategic planning tool.
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Audit methodology
Our five step audit methodology offers a high quality service wherever you are in the world and includes planning, risk assessment, testing internal controls, substantive testing, and concluding and reporting
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Audit technology
We apply our audit methodology with an integrated set of software tools known as the Voyager suite. Our technology has been developed to produce quality audits that are effective and efficient.
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Financial reporting advisory
Our financial reporting advisers have the expertise to help you deal with the constantly evolving regulatory environment.
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Business architecture
Our business architects help businesses with disruptive conditions, business expansion and competitive challenges; the deployment of your strategy is critical to success.
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Cloud services
Leverage the cloud to keep your data safe, operate more efficiently, reduce costs and create a better experience for your employees and clients.
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Internal audit
Our internal audits deliver independent assurance over key controls within your riskiest processes, proving what works and what doesn’t and recommending improvements.
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IT advisory
Our hands on product experience, extensive functional knowledge and industry insights help clients solve complex IT and technology issues
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IT privacy and security
IT privacy and security should support your business strategy. Our pragmatic approach focuses on reducing cyber security risks specific to your organisation
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Payroll assurance
Our specialist payroll assurance team can conduct a review of your payroll system configuration and processes, and then help you and your team to implement any necessary recalculations.
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PCI DSS
Our information security specialists are approved Qualified Security Assessors (QSAs) that have been qualified by the PCI Security Standards Council to independently assess merchants and service providers.
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Process improvement
As your organisation grows in size and complexity, processes that were once enabling often become cumbersome and inefficient. To maintain growth, your business must remain flexible, agile and profitable
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Procurement/supply chain
Procurement and supply chain inputs will often dominate your balance sheet and constantly evolve for organisations to remain competitive and meet changing customer requirements
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Project assurance
Major programmes and projects expose you to significant financial and reputational risk throughout their life cycle. Don’t let these risks become a reality.
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Risk management
We understand that growing companies need to establish robust internal controls, and use information technology to effectively mitigate risk.
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Robotic process automation (RPA)
RPA is emerging as the most sophisticated form of automation used to help businesses become more agile and remain competitive in the face of today’s ongoing digital disruption.
Louis Glickman famously surmised the best investment on earth is earth; however, as a property developer, you need to know when you can recognise the profit on that investment.
Once upon a time, developers could start to recognise the profit they expected to receive on real estate developments over time during construction. However, when the New Zealand Accounting Standards Board issued NZ IFRS 15 Revenue, from Contracts with Customers, they introduced a “no alternative use” model to more clearly delineate when and how revenue can be recognised by property developers.
So what does no alternative use actually mean? For example, how is it applied when dealing with a contract for the sale of a single residential apartment contained within a multi-unit complex currently under construction, as opposed to apartments that are completely built on spec? It usually depends on the property developer’s ability to demonstrate that it meets the following criteria set out in NZ IFRS 15:
- At all times throughout the duration of the contract, the property developer is entitled to an amount that compensates them for performance completed to date (eg, costs incurred to date plus a reasonable profit margin), and
- What the property developer is creating does not create an asset that can have alternative use. For the purposes of illustration assume that a property developer enters into separate contracts with customers for the sale of each individual unit in a high-rise apartment complex.
Determining whether an alternative use exists for individual apartments involves significant judgment based on careful consideration of the facts and circumstances. For example, could the apartment block be converted into business offices?
Specific guidance on how to assess alternative use has been hard to locate because there are few, if any, so-called ‘bright lines’ set out in NZ IFRS 15. However, two broad categories have now emerged to help property developers more confidently conclude whether they are constructing assets with “no alternative use”.
1. Substantive contractual limitations
Substantive contractual terms exist when they prevent the property developer from redirecting a specific unit under contract to another customer.
If a substantive contract provision makes it impossible for a property developer to redirect a specific apartment to another customer, even though other units in the complex might be similar, then that apartment does not have an alternative use to the developer because it’s legally obliged to transfer it to the original customer.
This could be accomplished by including a contractual term naming the specific unit being sold (eg, Apartment 730) or describing its attributes in enough detail that substitutability is effectively restricted (eg, the southwest facing corner unit on the 7th floor). However, a contractual restriction may not be substantive if, for example, it only represents a protective right that does not effectively restrict the vendor from physically substituting a largely interchangeable asset should something unforeseen happen (eg, a natural disaster or insolvency).
2. Practical limitations
A practical limitation exists if the developer incurs significant economic losses in repurposing the asset for another use. For example, an apartment that is highly customized for a buyer does not likely have an alternative use if the developer would need to incur significant costs to reconfigure it for someone else or they could only sell the unit at a significant loss.
For non-customised apartments, such practical limitations may not exist. That said, while individual apartments in some complexes may be fairly standardised, contractual provisions are often present that act to restrict the developer from redirecting a specific unit to another customer. In situations like this the no alternative use criterion would be met.
Various regulators around the world generally agree that when evaluating the no alternative use criterion, the property New Pagedeveloper must consider whether it could sell the completed asset to another customer without incurring a significant economic loss. It’s also interesting to note that in making that assessment, if customisation only takes place in the final 20% of build, that factor should not be taken into consideration.
A word of warning: the time to comply is now
This reporting standard came into effect for any reporting periods beginning on or after 1 January 2018, so if your balance date is on or after 31 December 2018, careful consideration of the “no alternative use” principle should be top of mind, because the amount of revenue recognised to date, and the consequential profits that result might have to change.
