TSB Community Trust Trustee Banks Restructuring Act 1988 TSB Community Trust Income and Expenditure Account and Retained Funds Statement for the Year Ended 31 March 1999 Notes 1999$ 1998$ Income Dividend from TSB Bank Limited2 1,395,000 1,200,000 Interest received 49,321 62,306 Donations 50,000 4,153 1,494,321 1,266,459 Less expenses Audit fees 1,603 1,572 Solicitors fees Professional services 1,671 Trustees' honoraria 48,672 34,782 Trustees' expenses 4,708 3,326 Administrator fees 22,693 16,511 Administrator mileage 666 500 Conference expenses 5,101 Stationery and postage 3,122 3,869 Advertising 2,645 2,201 Promotional expenses 2,454 Sundry expenses 500 1,094 Telephone and P.O. Box 942 766 Depreciation 72 2,267 92,395 69,342 Funds available for distribution 1,401,926 1,197,117 Donations during the year 1,332,550 1,188,350 Excess income over expenditure 69,376 8,767 Plus retained funds at beginning of year 595,661 586,894 $665,037 $595,661 Balance Sheet as at 31 March 1999 Notes 1999$ 1998$ Accumulated funds Capital 100 100 Initial gift1 10,000,000 10,00,000 10,000,100 10,000,100 Retained funds 665,037 595,661 Total funds $10,665,137 $10,595,761 Represented by: Current assets Petty cash 36 43 TSB Bank Limited 72,954 47,539 Accrued interest 5,092 8,477 78,082 56,059 Less current liabilities Accrued charges 14,596 10,298 Working capital 63,486 45,761 Fixed assets5 1,651 Investments Shares in TSB Bank Limited1 10,000,000 10,000,000 TSB Bank Limited investments 600,000 550,000 $10,665,137 $10,595,761 For and on behalf of the trustees: D. E. WALTER, Chairperson. Statement of Cash Flows for the Year Ended 31 March 1999 Notes 1999$ 1998$ Cash flow from operating activities Cash was provided from: Donations 50,000 4,153 Dividends from TSB Bank 1,395,000 1,200,000 Interest received 52,706 66,024 $1,497,706 $1,270,177 Cash was applied to: Donations 1,332,550 1,188,350 Payments to suppliers and trustees 88,025 67,174 1,420,575 1,255,524 Net cash flows from operating activities7 77,131 14,653 Cash flows from investing activities Cash was provided from: Principal from investments 1,345,000 775,000 Cash was applied to: Investments 1,395,000 750,000 Purchase of fixed assets 1,723 1,396,723 750,000 Net cash flows from investing activities (51,723[teh]) 25,000 Net increase/(decrease) in cash held 25,408 39,653 Plus opening cash 1 April 1998 47,582 7,929 Closing balance 31 March 19998 $72,990 $47,582 Statement of Movements in Equity for the Year Ended 31 March 1999 1999 1998 $ $ Equity at 1 April 199810,595,761 10,586,994 Retained surplus for the year69,376 8,767 Total recognised revenues and expenses69,376 8,767 Equity at 31 March 1999$10,665,137 $10,595,761 Notes to Financial Statements 1. Statement of Accounting Policies Reporting Entity TSB Community Trust is a charitable trust formed by a trust deed dated 30 May 1988. The financial statements are a general purpose report which has been prepared in accordance with generally accepted accounting practice as required by clause 17 of the trust deed. Measurement Base The measurement base is that of historical cost. Specific Accounting Policies The following specific accounting policies which materially affect the measurement of financial performance and financial position have been applied. Investments The TSB Bank Limited shares are stated at par value when gifted: 20 000 000 fully paid shares at 50 cents $10,000,000 The net asset backing at 31 March 1999 was $3.71 per share. Fixed Assets Fixed assets are recorded at cost, office equipment will be depreciated on a straight line basis over 4 years. Income Tax Income tax will include the current years provision and the tax effect of timing differences using the liability method. Timing differences will be accounted for applying the comprehensive basis. Differential Reporting The trust qualifies for differential reporting as it is not large as defined in the framework for differential reporting. The trust has taken advantage of all differential reporting exemptions except those in respect of FRS.10: statement of cash flows. Goods and Services Tax The financial statements have been prepared on a G.S.T. inclusive basis. Changes in Accounting Policies There have been no changes in accounting policies. All policies have been applied on bases consistent with those used in the previous years. 2. Dividend The dividend includes $920,000 relating to the final instalment received from the bank for year ended 31 March 1998 and $475,000 interim dividend for the year ended 31 March 1999. 3. Commitments and Contingent Liabilities At balance date $55,000.00 has been approved for donations in the 19992000 financial year (1998: $8,900). 4. Publishing Requirements A comprehensive list, itemising all recipients was published in the Taranaki Daily News on the following dates: First round15/8/98 Second round22/2/99 Third round22/4/99 A copy of the list of grants is available to anyone upon request (P.O. Box 31, Oakura, Taranaki). 5. Fixed Assets 1999$ 1998$ Office equipment at cost14,112 12,389.00 Accumulated depreciation12,461 12,389.00 $1,651 6. Income Tax There are taxation losses amounting to $132,294 (1998: $87,773) available to carry forward and set off against future assessable income. 7. Reconciliation of Net Surplus With Net Cash Flows From Operating Activities 1999$ 1998$ Net surplus69,376 8,767 Add/(less) depreciation72 2,267 Movements in working capital items: (Increase)/decrease in receivables3,385 3,718 Increase/(decrease) in payables4,298 (99[teh]) Net cash flows from operating activities$77,131 $14,653 8. Cash Balances in the Statement of Financial Position 1999$ 1998$ Petty cash36 43 TSB Bank Limited72,954 47,539 $72,990 $47,582 Audit Report to the Trustees of TSB Community Trust We have audited the financial statements. The financial statements provide information about the past financial performance of the trust and its financial position as at 31 March 1999. This information is stated in accordance with the accounting policies set out. Trustees' Responsibilities As trustees you are responsible for the preparation of financial statements which comply with generally accepted accounting practice and present a true and fair view of the financial position of the trust as at 31 March 1999 and its financial performance and cash flows for the year ended on that date. Auditor's Responsibilities It is our responsibility to express an independent opinion on the financial statements presented by the trustees and report our opinion to you. Basis of Opinion An audit includes examining, on a test basis, evidence relevant to the amounts and disclosures in the financial statements. It also includes assessing: the significant estimates and judgments made by the trustees in the preparation of the financial statements; and whether the accounting policies are appropriate to the trust's circumstances, consistently applied and adequately disclosed. We conducted our audit in accordance with generally accepted auditing standards in New Zealand. We planned and performed our audit so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial statements are free from material misstatements, whether caused by fraud or error. In forming our opinion we also evaluated the overall adequacy of the presentation of information in the financial statements. Other than in our capacity as auditor we have no relationship with, or interest in, the trust. Unqualified Opinion We have obtained all the information and explanations we have required. In our opinion the financial statements: comply with generally accepted accounting practice; and present a true and fair view of the financial position of the trust as at 31 March 1999 and its financial performance and cash flows for the year ended on that date. Our audit was completed on 28 April 1999 and our unqualified opinion is expressed as at that date. ERNST & YOUNG, Chartered Accountants. New Plymouth.