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10. Inventories, including land and developments
Inventories are valued at the lower of cost or net realisable value, determined principally on the first-in, first-out basis. Cost includes direct manufacturing costs and manufacturing overheads at normal operating levels. Included in inventories are land and developments which are stated at the lower of cost and net realisable value. Cost includes the cost of acquisition and development. Costs incurred after completion of development are expensed as incurred.
June 2018 NZ$M
June 2017 NZ$M
Fletcher Building Group
562 247 884
Raw materials
478 283 849
Work in progress Finished goods
55
Consumable stores and spare parts
42
1,748
1,652
1,609
Inventories held at cost
1,524
139
Inventories held at net realisable value
128
1,748 1,652 Land and developments to the value of $563 million are included above (June 2017: $540 million) of which $189 million is expected to be held for greater than 12 months (2017: $198 million). The Group also has conditional commitments for the purchase of land to be used for residential construction totalling $275 million (June 2017: $254 million), of which $98 million is expected to be delivered in the period to 30 June 2019
11. Creditors, accruals and other liabilities
Trade creditors and other liabilities are stated at cost or estimated liability where accrued. Employee entitlements include annual leave which is recognised on an accrual basis and the liability for long service leave which is measured as the present value of expected future payments to be made in respect of services provided by employees.
Assumptions in determining long service leave relate to the discount rate, estimates relating to the expected future long service leave entitlements, future salary increases, attrition rates and mortality.
June 2018 NZ$M
June 2017 NZ$M
Fletcher Building Group
1,073
Trade creditors
994
43 34
Contract retentions Accrued interest
46 32
214 212
Other liabilities
152 206
Employee entitlements
9
Workers' compensation schemes
12
1,585
1,442
1,547
Current portion
1,406
38
Non-current portion
36
Carrying amount at the end of the year 1,442 The non-current portion of creditors and accruals relates to long service employee entitlement obligations and deferred land payments. 1,585
71
Fletcher Building Limited Annual Report 2018
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