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Notice Type
General Section
Notice Title

The Community Trust Consolidated Financial Statements for the Year Ended 31 March 2000

The Community Trust-Trust Directory for the year Ended the 31st day of March 2000
Trust Particulars:
The Community Trust was incorporated as a charitable trust in accordance with the provisions of the Trustee provisions of the Community Trusts Act 1999.
The purpose of The Community Trust is to provide charitable, cultural and philanthropic and recreational benefits to the community.
Date of Trust Deed: 30 May 1988.
Settlor: Minister of Finance.
Trustees: I. D. Howell (Chair), J. M. Mckendry, J. C. Bedwell, P. Richardson, W. Dormer, R. H. Scott, M. I. Gibb, J. Smith,
B. G. Hadlee, M. W. Wisheart, P. H. Malone, S. S. J. Wong.
Administrator: W. Ward.
Accountants: Hadlee Kippenberger and Partners, P.O. Box 577, Christchurch (M. J. Hadlee).
Taxation Consultant: KPMG, P.O. Box 274, Christchurch (O. M. Wallis).
Auditors: PricewaterhouseCoopers, P.O. Box 13-244, Christchurch (J. A. Orr).
Fund Managers: Alliance Capital, AMP, Bankers Trust, Lazard Freres, Marvin and Palmer, Mercury Asset Management, Towers Perrin.
Custodial Trustee: The Chase Manhattan Bank.
Bankers: WestpacTrust.
Solicitors: Chapman Tripp Sheffield Young, P.O. Box 2510, Christchurch.
The Community Trust Trustees' Report for the Year Ended 31st March 2000
Objectives of the Trust and Charitable Company subsidiary:
To provide charitable, cultural, philanthropic and recreational benefits to the communities of Canterbury, Marlborough
and Nelson.
Policies and Structure of the Trust and Charitable Company subsidiary:
These organisations are structured to include community representatives from the three regions. Their policies are to manage and distribute their income and capital to the community they serve.
Activities of the Trust:
During the period under review the Trust and its charitable subsidiary have provided financial assistance to a wide range of community groups in Canterbury, Marlborough and Nelson. In addition to responding to applications for assistance these organisations have initiated several new projects of benefit to community groups.
Trustees' Remuneration:
During the period the trustees of the Trust received fees of $108,055 (1999 $85,589).
Review of Results and Financial Position:
The total distribution from the Trust and Charitable Company was $15.9 million (1999 $17.5 million, including $1.8 million for millenium grants) donations to community groups during the last 12 months.
Signed on behalf of the Board of Trustees:
Chairperson: I. D. HOWELL
Trustee: R. H. SCOTT.
Date: 27 April 2000.
The Community Trust Consolidated Statement of Financial Performance for the Year Ended 31st March 2000
2000 1999
Revenue (Note 2) 40,606,532 40,706,906
Less Investment Fees (Note 2) 2,008,114 1,896,591
Less Expenses (Note 2) 1,119,907 1,071,299
Net surplus before taxation 37,478,511 37,739,016
Less retentions
Transfer to Capital Base Reserve (Note 4) 2,898,410 6,766,362
Available for distribution 34,580,101 30,972,654
Donations to tax approved entities (Note 3) 12,189,188 12,938,981
Net surplus transferred to trust funds 22,390,913 18,033,673
The Community Trust Consolidated Statement of Movements in Trust Funds for the Year Ended 31st March 2000
2000 1999
Total trust funds at beginning of year 440,347,579 420,015,128
Less Donations paid from capital (Note 3) (3,716,451) (4,467,584)
436,631,128 415,547,544

Add net surplus for the year 22,390,913 18,033,673
Donations transferred to reserves (Note 4) 26,250 -
Increase in capital base reserve 2,898,410 6,766,362
Total trust funds at end of year 461,946,701 440,347,579
Represented by:
Core real capital base reserve (Note 4) 358,000,000 358,000,000
Accumulated income reserve (Note 4) 96,746,996 57,672,167
Capital base reserve (Note 4) 7,199,705 24,675,412
461,946,701 440,347,579
The Community Trust Consolidated Statement of Financial Position as at 31st March 2000
2000 1999
Trust funds (Note 4) 461,946,701 440,347,579
Represented by:
Current assets
WestpacTrust operating accounts 18,748 20,976
Bank deposits 3,496,947 663,086
Sundry current assets 6,255 -
Taxation refund due (Note 13) 121 105
3,522,071 684,167
Investments
Property Investment (Note 7) 4,180,788 4,162,160
Managed Funds 456,974,854 438,803,332
Community Loans 54,582 146,920
461,210,224 443,112,412
Fixed assets (Note 8) 129,218 183,678
Total assets 464,861,513 443,980,257
Current liabilities
Accounts payable and goods and services tax 106,812 112,000
Committed donations and special projects 2,808,000 3,520,678
Total liabilities 2,914,812 3,632,678
Net assets 461,946,701 440,347,579
The Community Trust Consolidated Statement of Cash Flows for the Year Ended 31st March 2000
2000 1999
Cash was provided by (used for):
Operations (Note 5)
Income from investments 34,301,793 46,306,119
Payments to suppliers, employees and trustees (2,962,848) (2,817,330)
Payments of taxation (16) 1,454,495
Payments of Goods and Services Tax (1,271) 5,159
Donations to the community (15,904,164) (13,746,430)
Payments to beneficiaries (687,903) (3,642,518)
14,745,591 27,559,495
Investing-
Sale of government and local authorities securities - 303,804
Managed funds investments (11,872,343) (32,366,166)
Movement in term deposits (2,833,861) 5,057,063
Community loans 92,338 104,833
Sale (purchase) of fixed assets (133,953) (579,904)
(14,747,819) (27,480,370)
Increase in cash (2,228) 79,125
Cash at beginning of year 20,976 (58,149)
Cash at end of year 18,748 20,976
Represented by:

WestpacTrust operating accounts 18,748 20,976
The Community Trust Notes to the Financial Statements for the Year Ended 31st March 2000
1. Statement of Accounting Policies
General Accounting Policies:
The following general accounting policies have been adopted in the preparation of the financial statements.
(i) The Community Trust was incorporated as a charitable trust in accordance with the provisions of Community Trusts Act 1999. These financial statements have been prepared in accordance with applicable Financial Reporting Standards.
(ii) Community Trust Charities Limited is a charitable company incorporated under the Companies Act 1993 and is a reporting entity for the purposes of the Financial Reporting Act 1993. The financial reports of Community Trust Charities Limited have been prepared in accordance with the Financial Reporting Act 1993.
(iii) Canterbury Trust House Limited was incorporated on 18 December 1995 under the Companies Act 1993. Canterbury Trust House Limited is a reporting entity for the purposes of the Financial Reporting Act 1993. The financial statements of Canterbury Trust House Limited have been prepared in accordance with the Financial Reporting Act 1993.
(iv) The measurement base adopted is that of historical cost, except for the revaluation of investments. Reliance is placed on the fact that the Trust is a going concern.
(v) The matching of revenue earned and expenses incurred using accrual accounting concepts.
Specific Accounting Policies
Depreciation
Depreciation has been charged in the financial statements using rates allowed by the Inland Revenue Department which will write off the cost of assets less their estimated residual value over their estimated economic lives.
The depreciation rates used are:
Buildings 3% c.p.
Office equipment 6-60% c.p.
Furniture and fittings 14-40% d.v.
Computer 28-48% d.v
Motor vehicles 18-22% c.p.
Fixed Assets and Investment Property:
Fixed assets and investment property are recorded at cost less accumulated depreciation.
Investments:
Investments are shown at market value. Net income including realised and unrealised gains or losses from
holding or trading these investments are recorded in the statement of financial performance.
Donations, Special Projects and Community Loans:
Donations, Special Projects and Community Loans are accounted for on an accruals basis.
The Community Trust Notes to the Financial Statements for the Year Ended 31st March 2000
Dividend Income:
Dividend income is included in the statement of financial performance when it is received.
Income Tax:
Income tax expense is recognised on the surplus available for distribution before taxation, adjusting for differences between taxable and accounting income.
Goods and Services Tax:
The subsidiary of Community Trust Charities Limited, Canterbury Trust House Limited, is registered for GST. Accordingly its financial performance and financial position have been consolidated within the accounts on a G.S.T. exclusive basis. Subject to the above, the Trust is not registered for GST purposes and therefore the financial statements have been prepared on a G.S.T. inclusive basis.
Financial Instruments:
Foreign currency transactions are translated to New Zealand currency at the exchange rate ruling at the dates of the transactions. Amounts receivable and payable in foreign currencies at balance date are translated at the exchange rate at that date. Exchange differences arising from the translation of amounts payable and receivable in foreign currencies are recognised in the statement of financial performance.
Off-balance sheet financial instruments that are designated as hedges are recognised on the same basis as the underlying hedged item. Off-balance sheet transactions that do not constitute specific hedges are stated at market value and any resultant gain or loss is recognised in the statement of financial performance.
Cash:
For the purpose of the Statement of Cash Flows, cash comprises WestpacTrust balances only. Cash excludes bank deposits not used as part of the Trust's day-to-day cash management.
Basis of Consolidation:
The Community Trust, Community Trust Charities Limited and its subsidiaries, Canterbury Trust House Limited, Amateur Game or Sport Promoter Limited and District Improvement Organisation Limited have been consolidated using the purchase method of consolidation.
Changes in Accounting Policies:
There have been no changes in accounting policies. All policies have been applied on bases consistent with those used last year.
2. Revenue and Expenses
Revenue:
Rents received 314,909 145,674
Interest received 45,753 267,038
Investment income 40,245,870 40,294,194
40,606,532 40,706,906
Investment Fees:
Fund managers fees 1,472,610 1,452,928
Custodial fees 351,733 273,862
Advisory fees 83,771 169,801
2,008,114 1,896,591
Expenses:
Advertising, public relations, distribution and other costs 324,437 279,636
Computer and system review costs 15,687 36,212
Depreciation and loss on sale 179,446 165,811
Professional fees 172,275 170,266
Property costs 23,305 66,739
Salaries and staff recruiting fees 296,702 263,242
Trustees fees 108,055 85,589
Change on value of Government Securities investment - 3,804
1,119,907 1,071,299
3. Donations
The names of organisations to whom distributions have been made by the Trust under section 13 of Community Trusts Act 1999 during the financial year and the amounts distributed are shown in the Annual Report.
2000 1999

Donations paid from income 12,189,188 12,938,981
Donations paid from capital 3,716,451 4,467,584
(Includes prior year adjustments for cancellation, refunds, etc.) 15,905,639 17,406,565
Future commitments: 39,375 1,964,060
Funds carried forward as accumulated income are available for the payment of donations in future years.
Budgeted donations unspent in the current year are to be distributed in the following year.
Future donation commitments represent donations approved in the current or previous years which are to be distributed from either capital or future income sources.
4. Trust Funds
2000 1999
Core Real Capital Base Reserve:
Balance brought forward 358,000,000 358,000,000
Transfer from accumulated income reserve 3,716,451 4,467,584
Donations paid from capital (3,716,451) (4,467,584)
358,000,000 358,000,000
Accumulated Income Reserve:
Balance brought forward 57,672,167 44,106,078
Transfer to core real capital base reserve (3,716,451) (4,467,584)
Donations transferred to reserves 26,250 -
Adjustment to capital base reserve 20,374,117 -
Net surplus for year 22,390,913 18,033,673
96,746,996 57,672,167
Capital Base Reserve:
Balance brought forward 24,675,412 17,909,050
Retention as per statement of financial performance 2,898,410 6,766,362
Adjustment to capital base reserve (20,374,117)
7,199,705 24,675,412

Total Trust Funds: 461,946,701 440,347,579
Donations transferred to reserves represents unspent donations for specific Making It Happen projects for the Canterbury region transferred to Accumulated Income Reserves.
The capital base reserve is an allowance for the erosion of the value of the Core Real Capital Base Reserve, due to inflation. For 2000 this was calculated based on inflation at .8% on a Core Real Capital Base Reserve of $362,301,294 being the original Core Real Capital Base Reserve of $358,000,000 plus the adjusted Capital Base Reserve of $4,301,294.
5. Reconciliation of Net Surplus to Net Operating Cashflow
2000 1999
Net Surplus from Statement of Financial Performance: 22,390,913 18,033,673
Adjustments for Non Cash Items in Net Surplus:
Depreciation 169,785 160,433
Managed Funds Income Unrealised (6,299,179) 5,478,740
16,261,519 23,672,846
Adjustments for changes in Working Capital:
Decrease/(increase) in accounts receivable (6,255) 1,024
Decrease/(increase) in accrued interest - 119,449
Decrease/(increase) in prepayments - 18,160
Increase/(decrease) in accounts payable (5,188) (28,034)
Increase/(decrease) in donations payable (712,678) (52,383)
Increase/(decrease) in taxation payable (16) 1,454,495
Increase/(decrease) in Goods and Services Tax - 5,159
Increase/(decrease) in donations paid in advance - 70,000
15,537,382 25,260,716

Add capital base reserve transfer 2,898,410 6,766,362
Deduct donations paid from capital (3,690,201) (4,467,584)
Cash flow from operations 14,745,591 27,559,494
6. Capital Commitments
There are no capital commitments at balance date (1999 Nil).
7.Investment Property
The investment property of the Trust is valued at cost less accumulated depreciation. Payments made on theinvestment property as at 31 March 2000 consist of the purchase of the land at 262 Oxford Terrace and adjoiningproperty, architectual and legal fees, stamp duty, building consent permits and building costs to date.
2000 1999
Land 814,583 814,583
Building construction and associated property costs 3,633,524 3,506,730
Less accumulated depreciation (267,319) (159,153)
4,180,788 4,162,160
8. Fixed Assets
2000 1999
Accumulated Book Book
Cost Depreciation Value Value

Plant and equipment 45,518 29,573 15,945 21,074
Computer 121,384 67,853 53,531 85,171
Motor vehicles 43,832 32,367 11,465 14,624
Furniture and fittings 86,706 38,429 48,277 2,809
Fixed assets 297,440 168,222 129,218 183,678
9. Contingent Liabilities
There are no contingent liabilities at balance date (1999 Nil) apart from donation commitments as per note 3.
10. Segmental Reporting
The Trust operates as a charitable trust in the Canterbury, Marlborough and Nelson areas. As all operations occur within
New Zealand, segmental reporting is not required.
11. Related Party
In the normal course of business the Trust has no related parties with any entity, other than those advised in note 1.
12. Financial Instruments
Investments are stated at market value at balance date. Accrued interest, accounts payable, community loans, and donations approved not yet paid are stated at the amounts expected to be received or paid Accordingly, the Trustees consider that the fair value of each class of financial assets and financial liabilities is the same as the carrying value in the financial position.
Concentration of Investments
Ninety-eight percent (98%) of the assets of the Trust are represented by investments held with a range of financial institutions. However the Trustees consider the risk of non-recovery of these investments to be minimal.
Currency Risk
The Trust incurs currency risk as a result of investment transactions entered into by Fund Managers
Interest Rate Risk
The following investments of the Trust are sensitive to changes in interest rates: Bank call accounts and deposits, government and local authority and securities held by Fund Managers.
Loans and advances with related parties do not carry interest and therefore do not hold any interest rate risk.
13. Taxation
2000 1999
Net Income before taxation as per statement of financial performance 37,478,511 37,739,017

Add: Non Deductible Expenditure 312,763 324,695
Imputation Credits Received 764,565 425,426
Witholding Taxes on Investments 185,325 213,943
Canterbury Trust House Limited Loss 192,650 15,012
Less: Revaluation of Equities (10,357,764) (3,087,579)
Allocated as Beneficiaries Income (12,018,857) (21,754,051)
Donations to Tax Approved Entities (12,189,188) (12,938,981)
Assessable income for tax purposes 4,368,005 937,482
Less: Loss carry forward entitlement (3,591,193) (3,591,193)
Taxable Income 776,812 937,482
Taxation @ 33% 256,348 309,369
Less: Imputation Credits Received (764,565) (425,426)
Tax credits on New Zealand and overseas dividends (185,325) (213,943)
Resident withholding tax (121) (105)
Add: Excess imputation credits 693,542 330,000
Taxation payable (refund) as per the statement of financial position (121) (105)
Auditors' Report to the Trustees of The Community Trust
We have audited the consolidated financial statements. The consolidated financial statements provide information about the past financial performance and cash flows of the Trust and subsidiaries for the year ended 31 March 2000 and their financial position as at that date. This information is stated in accordance with the accounting policies set out therein.
Trustees' Responsibilities
The Trustees are responsible for the preparation and presentation of the consolidated financial statements which give a true and fair view of the financial position of the Trust and subsidiaries as at 31 March 2000 and their financial performance and cash flows for the year ended on that date.
Auditors' Responsibilities
We are responsible for expressing an independent opinion on the consolidated financial statements presented by the Trustees and reporting 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:
(a) the significant estimates and judgements made by the Trustees in the preparation of the financial statements; and
(b) whether the accounting policies used and described therein are appropriate to the circumstances of the Trust and subsidiaries, 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 to provide us with sufficient evidence to give reasonable assurance that the consolidated 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 consolidated financial statements.
We have no relationship with or interests in the Trust and subsidiaries other than in our capacity as auditors.
Unqualified Opinion
We have obtained all the information and explanations we have required.
In our opinion:
(a) proper accounting records have been kept by the Trust as far as appears from our examination of those records; and
(b) the consolidated financial statements:
(i) comply with generally accepted accounting practice; and
(ii) give a true and fair view of the financial position of the Trust and subsidiaries as at 31 March 2000 and their financial performance and cash flows for the year ended on that date.
Our audit was completed on 27 April 2000 and our unqualified opinion is expressed as at that date.
PricewaterhouseCoopers,Chartered Accountants, Christchurch, New Zealand.