Consolidated Statement of Financial Performance for the Year Ended 31 March 2000
notes 2000 1999
$ $
Income:
Investment income (net) 10 9,144,524 4,501,783
Interest received 2,285 10,984
Donations returned - 1,500
Rental income 157,808 76,620
Total income 9,304,617 4,590,887
Less expenses:
Auditors' fees 8,336 7,438
Depreciation 2,423 1,792
Unrealised loss on investment property 83,750 -
Donation expenses 14,142 21,477
Interest 58,492 30,121
Operating costs 216,812 199,854
Trustee expenses 9,951 11,924
Trustee fees 55,289 54,630
Total expenses 449,195 327,236
Net surplus before donations and taxation 8,855,422 4,263,651
Less:
Donations 2,413,533 5,105,114
Net surplus before taxation 6,441,889 (841,463)
Less:
Provision for taxation 20,694 -
Net surplus/(deficit) 6,421,195 (841,463)
Consolidated Statement of Movements in Trust Funds for the Year Ended 31 March 2000
notes 2000 1999
$ $
Trust funds at 1 April 1999 47,924,287 48,767,000
Plus:
Net surplus 6,421,195
54,345,482 48,767,000
Less:
Allocated to donation reserve from prior years' trust funds 2,530,871 -
Net deficit 841,463
Total trust funds at 31 March 2000 51,814,611 47,925,537

Donation reserve account-
Opening balance as at 1 April 1999 - -
Allocation from prior years' trust funds 2,530,871 -
Less:
Donations paid from prior years' trust funds 2,530,871 -
Closing balance as at 31 March 2000 - -
Consolidated Statement of Financial Position as at 31 March 2000
notes 2000 1999
$ $
Current assets:
Bank accounts 130,809 63,720
Short term deposit 2,000,000 -
Accounts receivable - trading 12,807 -
Accounts receivable - investment 195,169 151,139
Prepayments 2,958 2,861
Taxation refund 2,420 2,417
Total current assets 2,344,163 220,137
Less current liabilities:
Accounts payable - trading 89,874 99,224
Accounts payable - investment 9,283 132,224
Bank of New Zealand loan - current portion 9 42,807 97,915
Provision for taxation 5 20,694 -
Goods and services tax 3,092 4,201
Total current liabilities 165,750 333,564
Net current assets 2,178,413 (113,427)
Non current assets:
Fixed assets 3 8,779 4,212
Investments 4 50,291,937 48,683,684
Total non current assets 50,300,716 48,687,896
Non current liabilities:
Bank of New Zealand loan - term portion 9 664,518 648,932
Total non current liabilities 664,518 648,932
Net assets 51,814,611 47,925,537
Represented by:
Trust funds 51,814,611 47,925,537
Total trust funds 51,814,611 47,925,537
For and on behalf of the board of trustees:
BILL BRIEN, Chairperson.
PETER WILLIS, Trustee.
Date: 6 June 2000.
Consolidated Statement of Cash Flows for the year ended 31 March 2000
2000 1999
$ $
Cash flows from operating activities-
Cash was provided from:
Interest on investments 2,285 10,984
Rental income 138,375 76,620
OPEX recovered 8,312 -
G.S.T. received - 4,052
Donations returned - 1,500
148,972 93,156
Cash was applied to:
Payments to suppliers (297,513) (248,297)
Payments to fund managers (176,486) 260,679)
Payments to trustees (48,594) (70,135)
Donations to community (4,944,404) (5,105,114)
Tax paid (3) (1,928)
G.S.T. paid (2,081) -
(5,469,081) (5,686,153)
Net inflow (outflow) from operating activities (5,320,109) (5,592,997)
Cash flows from investing activities-
Cash was provided from:
BNZ loan - 746,847
Net realisation from investments 7,680,000 8,125,789
7,680,000 8,872,636
Cash was applied to:
Purchase of investment properties - (1,383,750)
Purchase of fixed assets (6,991) (672)
The Embassy Theatre Trust loan - (530,000)
Karori Sanctuary Wildlife Trust loan (188,000) (1,312,000)
(194,991) (3,226,422)
Net inflow (outflow) from investing activities 7,485,009 5,646,214
Cash flows from financing activities-
Cash was provided to:
BNZ loan principal repayments (39,522) -
Interest expense (58,289) -
(97,811) -
Net increase (decrease) in cash held 2,067,089 53,217
Opening cash brought forward 63,720 10,503
Closing cash carried forward 2,130,809 63,720
Shown in Statement of Financial Position as
Cash at bank 2,130,809 63,720
Closing cash carried forward 2,130,809 63,720
Consolidated Notes to the Financial Statements for the year ended 31 March 2000
I. Statement of accounting policies
Reporting entity
The financial statements presented here are for the reporting entity Trust Bank Wellington Community Trust and its wholly owned companies, Wellington Community Trust Charities Limited and Jarden Mile Investments Limited. The Trust Bank Wellington Community Trust is an incorporated Charitable Trust under the Charitable Trusts Act 1957.
Reporting basis
The trustees have chosen to prepare general purpose financial reports which comply with generally accepted accounting practice.
Measurement base
The measurement base adopted is historical cost with the exception of certain items for which specified accounting policies are identified.
Investment income (net)
Investment income (net) includes gross investment income less management fees payable to the fund managers.
Investment property
The investment property held is valued at net current value. Depreciation is not charged on the investment property .The net change in the value of the investment property is recorded in the consolidated Statement of Financial Performance.
Basis of consolidation
The consolidated financial statements have been prepared using the purchase method of consolidation and include the financial statements of the parent and subsidiary companies.
All significant inter-entity profits and transactions have been eliminated in preparing the consolidated financial statements.
Accounts receivable
Accounts receivable are stated at expected realisable value.
Donations
Donations made from current years income are recorded in the Statement of Financial Performance when paid. Donations from prior years' income are recorded in the Donation Reserve Account when paid.
Fixed assets
Fixed assets are stated at cost less accumulated depreciation.
Depreciation
Depreciation is charged at the maximum rates allowable by the Inland Revenue Department. The tax rates are as follows:
Computer equipment 24.0 - 48.0 %CP
Office furniture 13.2 - 14.4 %DV
Goods and services tax
The Community Trust of Wellington financial statements are prepared on a G.S.T. inclusive, basis with the exception of transactions relating to Jarden Mile Investments Limited, whose financial statements are prepared on a G.S.T. exclusive basis, as it is registered for goods and services tax.
Shares and investments
Shares and other investments are stated at the market value. Changes in the market value of investments are taken to the Statement of Financial Performance.
Financial instruments
All financial instruments held by the trust are recorded in the Statement of Financial Position. The financial instruments comprise equity securities, discounted securities, secured investments, borrowings, deposits and cash. Concentrations of credit risk arise as a result of holding equity securities as investments. These are subject to the normal market risk associated with investments of this nature. There are no significant differences between the fair value and book value of financial instruments.
Where possible, financial assets and liabilities are supported by collateral or other security. These arrangements are described in the individual policy statements associated with each item.
Changes in accounting policies
There have been no changes in accounting policies. All policies have been applied on bases consistent with those used in previous years.
2. Nature of business
The Trust Bank Wellington Community Trust was incorporated as a charitable trust in accordance with the provisions of the Trustee Banks Restructuring Act 1988. The purpose of the community trust is to provide charitable, cultural, philanthropic and recreational benefits to the community, principally in the trust region.
The nature of business of the wholly owned companies, Wellington Community Trust Charities Limited and Jarden Mile Investments Limited, is restricted by their constitution to providing charitable benefits to the community , principally in the region of The Community Trust of Wellington.
The Trust Bank Wellington Community Trust and its subsidiary companies operate under the trading name of "The Community Trust of Wellington".
3. Fixed assets
2000
Cost Accumulated Book
Depreciation Value
$ $ $
Computer equipment 13,783 7,647 6,135
Office furniture 4,013 1,369 2,644
17,796 9,016 8,779
1999
Cost Accumulated Book
Depreciation Value
$ $ $
Computer equipment 6,793 5,713 1,080
Office furniture 4,013 882 3,131
10,806 6,595 4,211
4. Investments
Investments held by Tower Asset Management comprise:
2000 1999
$ $
Money market deposits 3,872,170 3,190,561
Fixed interest bonds 4,623,201 5,569,33
Equities 17,961,499 17,799,454
Other investments 103,598 2, 746
Total investments at 31 March 2000 26,560,468 26,562,096
Investments held by BT Funds Management (NZ) Limited comprise:
2000 1999
$ $
Currency 106,302 (102,267)
Property - -
Fixed interest bonds 1,771,204 3,067,172
Equities 17,376,282 14,117,062
Short term investment 1,147,681 1,812,621
Total investments at 31 March 2000 20,401,469 18,894,588
Secured investments
2000 1999
$ $
The Embassy Theatre Trust 530,000 530,000
Karori Wildlife Sanctuary Trust 1,500,000 1,312,000
Total secured investments at 31 March 2000 2,030,000 1,842,000
On 30 June 1998 The Embassy Theatre Trust entered into a mortgage agreement with Wellington Community Trust Charities Limited. The mortgage is repayable over 10 years and is secured over the property owned by The Embassy Theatre Trust. The first repayment will be on I July 2002.
On 19 February 1999 the Karori Wildlife Sanctuary Trust entered into a loan agreement with Wellington Community Trust Charities Limited. The loan is guaranteed by the Wellington City Council. The loan is to be repaid over 15 years with repayments commencing from 1 July 2004.
Investment property
2000 1999
$ $
At cost 1,383,750 1,383,750
Revaluations brought forward 1,250 -
Current year revaluation (85,000) 1,250
Total investment property at 31 March 2000 1,300,000 1,385,000
The investment property has been valued as at 31 March 2000. The carrying value of the property includes allowances for potential disposal costs. The valuation was carried out on 16 May 2000 by an independent registered valuer, M. J. Bevin BPA ANZIV, of Darroch Limited.
Total investments at 31 March 2000 50,291,937 48,683,684
It is the intention of the trustees to hold the investments long term and accordingly they have been classified as non current assets.
5. Taxation
The charitable status of the Trust Bank Wellington Community Trust is currently being reviewed by the Inland Revenue Department. To date, this review has resulted in a tax liability of $20,694, which has been recorded in the financial statements.
For taxation purposes, Wellington Community Trust Charities Limited is deemed to be a charitable organisation and on this basis the income is not subject to taxation. The company's charitable status was confirmed on 27 August 1997 by the Inland Revenue Department.
For taxation purposes, Jarden Mile Investments Limited is deemed to be a charitable organisation and on this basis the income is not subject to taxation. The company's charitable status was confirmed on 29 September 1998 by the Inland Revenue Department.
6. Commitments
(a) Donations
As at 31 March 2000 The Community Trust of Wellington has conditionally committed funding to:
2000 1999
$ $
* Wellington Regional Stadium Trust - 2,000,000
* Wellington Regional Sports Trusts Inc. 1,000,000 1,500,000
* Wellington Museums Trust Inc. 1,200,000 1,800,000
* Victoria University of Wellington Foundation 50,000 100,000
* Wellington School of Medicine - Surgical Research Trust 60,000 120,000
* Te Runanganui O Taranaki Whanui Ki Te Upoko O Te Ika A Maui Incorporated 120,000 -
* New Zealand Symphony Orchestra Limited 300,000 -
* WellTrust 3,000,000 -
Total commitments at 31 March 2000 5,730,000 5,520,000
2000 1999
$ $
Payable no later than one year 2,620,000 3,210,000
Payable later than one year, not later than two years 1,310,000 1,210,000
Payable later than two years 1,800,000 1,100,000
5,730,000 5,520,000
As at 31 March 2000 donations approved by The Community Trust of Wellington and subject to the satisfaction of certain conditions were:
2000 1999
$ $
* Junior Cricket Upper Hutt (approved 1997) 100,000 100,000
* Upper Hutt Bowling & Tennis Club 15,000 -
* New Zealand Aids Foundation 3,000 -
* Mauri Ora Newspaper Charitable Trust 1,500 -
* Clean Up New Zealand Trust 10,000 -
Total not uplifted at 31 March 2000 129,500 100,000
(b) Lease commitments
Commitments existed for non-cancellable operating leases as follows:
2000 1999
$ $
* Not later than one year 4,641 4,641
* Later than one year - -
4,641 4,641
(c) Capital commitments
The group has no capital commitments as at 31 March 2000. (1999 $Nil)
7. Contingent liabilities
The trust has no contingent liabilities as at 31 March 2000. (1999 $Nil)
8. Financial instruments
Investments are stated at estimated market value at balance date. Accounts payable, secured investments and accounts receivable are stated at the amount expected to be received or paid.
Accordingly, the trustees consider that the fair value of each class of financial asset and financial liabilities is the same as the carrying value in the statement of financial position.
Concentration of credit risk
The concentrations of credit risk incurred by the trust are managed by Tower Asset Management and BT Funds Management (NZ) Limited. Credit risk also exists with the loan agreements entered into during the year.
Trustees consider the risk of non-recovery of these investments to be within satisfactory guidelines.
Maximum exposures to credit risk as at balance date are:
2000 1999
$ $
Bank accounts 2,130,809 63,720
Accounts receivable 207,976 151,139
Investments 50,376,937 48,683,684
Currency risk
The Community Trust of Wellington incurs currency risk as a result of investment transactions managed by Tower Asset Management and BT Funds Management (NZ) Limited.
Interest rate risk
The investments of the Community Trust of Wellington which are sensitive to changes in interest rates are managed by Tower Asset Management and BT Funds Management (NZ) Limited. The Community Trust of Wellington is also exposed to interest rate fluctuation on loans, as the debt is on a floating rate.
9. Term Loan
2000 1999
$ $
Bank of New Zealand
Current 42,807 97,915
Non current 664,518 648,932
Total liability 707,325 746,847
Security Registered first mortgage held over property situated at 19 Jardin Mile, Ngauranga
Interest Rate 8.01 %pa (fixed for 4 years)
Repayments For the first five years, 60 consecutive monthly payments of $8159.57. After five years the repayment instalments may be varied so the whole of the loan plus interest is repaid over the term of the loan.
Final repayment date Repayment based on 12 year term
10. Investment income (net)
2000 1999
$ $
Portfolio income-realised and unrealised revenue 9,321,011 4,729,761
Less fund management fees and expenses (176,486) (227,979)
Total investment income (net) 9,144,525 4,501,782
11. Reconciliation of net surplus(deficit) with net cash flow from operating activities
2000 1999
$ $
Net surplus/(deficit) 6,421,195 (841,466)
Add/(deduct) financing items:
Interest expense 58,289 -
Add/(deduct) non cash items:
Depreciation 2,423 1,793
Unrealised loss of investment property 83,750 -
Portfolio investment income reinvested (9,251,669) (4,858,175)
(2,686,012) (5,697,848)
Add/(deduct) movements in other working capital items:
Increase)/decrease in accounts receivable (56,837) 30,926
(Increase)/decrease in prepayments (97) (1,342)
Increase/(decrease) in accounts payable (132,293) (243,090)
Increase/(decrease) in G.S.T. (1,109) 4,201
Increase/(decrease) in taxation paid (3) (2,307)
Increase/(decrease) in tax provision 20,694 -
(169,645) (211,612)
Add(deduct) items classified as an investing activity:
Movement-Tower Asset Management (19,804) 29,484
Movement-BT Funds Management (NZ) Limited 86,223 286,979
66,419 316,463
Add(deduct) movements in trust funds:
Donations paid from prior years' trust fund (2,530,871) -
Net cash flow from operating activities (5,320,109) (5,592,997)
Audit Report
To the readers of the financial report of Trust Bank Wellington Community Trust and its subsidiary companies (trading as) The Community Trust of Wellington (the Group).
We have audited the financial report. The financial report provides information about the past financial performance and its financial position of the Group as at 31 March 2000. This information is stated in accordance with the accounting policies.
Board of Trustees' Responsibilities
The board of trustees is responsible for the preparation of a financial report which gives a true and fair view of the financial position of the Group as at 31 March 2000 and of the results of operations and cash flows for the year ended 31 March 2000.
Auditors' Responsibilities
It is our responsibility to express an independent opinion on the financial report presented by the board of 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 report. It also includes assessing:
? the significant estimates and judgements made by the board of trustees in the preparation of the financial report, and
? whether the accounting policies are appropriate to the Group'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. We obtained sufficient evidence to give reasonable assurance that the financial report is 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 report.
Other than in our capacity as auditors we have no relationship with or interests in the Group.
Unqualified Opinion
We have obtained all the information and explanations we have required.
In our opinion:
? proper records have been kept by the Group as far as appears from our examination of those records; and
? the financial report:
- complies with generally accepted accounting practice;
- gives a true and fair view of the financial position of the Group as at 31 March 2000 and the results of its operations and cash flows for the year ended on 31 March 2000.
Our audit was completed on 6 June 2000 and our unqualified opinion is expressed as at that date.
SPICER & OPPENHEIM, Chartered Accountants, Wellington.
A copy of the complete Annual Report, which includes a list of the successful recipients for the 1999/2000 year, is available on request at the office of The Community Trust of Wellington, Level One, 28 Grey Street, Wellington, or by phoning
499 7966.