Consolidated Statement of Financial Performance for the Year Ended 31 March 2001
Note 2001 2000
$ $
Income
Income from investments 2 (4,804,814) 19,153,909
Less expenditure
Advertising and promotion 236,099 246,771
Auditor fees - Trust audit 7,931 8,119
- Other services 3,699 897
Depreciation 15,269 14,762
Rent and occupancy 46,914 43,563
Professional fees 69,370 60,704
Trustee expenses 43,537 51,827
Trustee fees 120,163 123,345
Wages and salaries 181,451 157,468
Other expenses 69,954 55,352
Total expenditure 794,388 762,808
Net income before community payments (5,599,201) 18,391,101
Less community payments
Standard donations 1,651,113 1,858,751
Special donations 5,453,302 5,573,117
Bursaries 442,500 462,500
Shooting star projects 4,258,217
Total community payments 11,805,132 7,894,368
Less donations written back 142,216 57,715
Total community donations paid 11,662,916 7,836,653
Net surplus/(deficit) for the period (17,262,118) 10,554,448
Consolidated Statement of Movements in Equity for the Year Ended 31 March 2001
2001 2000
$ $
Equity at start of period 148,950,226 138,395,778
Net surplus/(loss) for the period (17,262,118) 10,554,448
Total recognised revenues and expenses (17,262,118) 10,554,448
Equity at the end of period 131,688,108 148,950,226
Consolidated Statement of Financial Position as at 31 March 2001
Note 2001 2000
$ $
Assets
Investments in managed funds 3 120,269,549 139,408,426
Self-managed NZ bonds - 2,995,751
Fixed assets 4 36,830 40,950
Accrued income 66,379 138,368
Cash and bank deposits 5 16,933,082 9,230,481
Total assets 137,305,841 151,813,976
Liabilities
Sundry payables 158,120 124,047
Employee entitlements 7,222 11,928
Donations payable 6 5,452,391 2,727,775
Total liabilities 5,617,732 2,863,750
Net assets 131,688,108 148,950,226
Equity
Trustee funds 131,688,108 148,950,226
Total trust funds 131,688,108 148,950,226





GRAEME GLASS BRIAN BOURKE
Chairperson Trustee
12th June 2001 12th June 2001
Consolidated Statement of Cash Flows for the Year Ended 31 March 2001
Note 2001 2000
$ $
Cash flows from operating activities-
Cash was provided from:
Interest and dividends on investments 1,588,944 4,605,135
1,588,944 4,605,135
Cash was applied to:
Community payments (8,938,301) (6,765,414)
Trustees and employees (349,857) (337,992)
Suppliers of other goods and services (705,394) (383,326)
Net operating cash flows 7 (8,404,608) (2,881,597)
Cash flows from investing activities-
Cash was provided from:
Sale of government securities 3,103,858 350,000
Withdrawals from managed funds 13,014,501 3,938,770
16,118,359 4,288,770
Cash was applied to:
Purchase of fixed assets (11,150) (18,192)
Net investing cash flows 16,107,209 4,270,578
Net increase (decrease) in cash held 7,702,601 1,388,981
Add cash at 1 April 9,230,481 7,841,500
Cash at 31 March 5 16,933,082 9,230,481
Notes to the Consolidated Financial Statements for the Year Ended 31 March 2001
1. Statement of Accounting Policies
1.1 Reporting Entity
Eastern and Central Community Trust is a charitable trust incorporated in accordance with the provisions of the Trustee Banks Restructuring Act 1988.
The trust has a wholly owned company - Eastern & Central Community Trust Charities Limited - which is registered under the Companies Act 1993.
The consolidated financial statements have been prepared in accordance with generally accepted accounting practice.
1.2 Measurement Base
The measurement base applied is that of historical cost adjusted for the market valuation of investments.
1.3 Specific Accounting Policies
The following are the particular accounting policies which have a material effect on the measurement of results and financial position.
1.3.1 Basis of Consolidation
The consolidated financial statements include the trust and its wholly owned company accounted for using the purchase method. All significant inter-entity transactions are eliminated on consolidation. Both entities have a common balance date of 31 March.
1.3.2 Investment Income is accounted for on an accruals basis recognising both realised and unrealised gains or losses in value.
1.3.3 Foreign Currency balances are converted to NZD at the year end rate of exchange unless covered by a forward exchange contract. Where such contracts are in place, the contracted rate is adopted. Transactions completed during the year are converted at the rate applying at the approximate date of the transaction. Foreign exchange gains and losses are included within the statement of financial performance.
1.3.4 Investments are recorded at market value at year-end.
1.3.5 Cash comprises cash at bank, call deposits and short-term deposits but does not include cash held by fund managers.
1.3.6 Donations are included in the statement of financial performance when approved by the trustees.
1.3.7 Fixed Assets
Fixed assets are recorded at cost less accumulated depreciation.
1.3.8 Depreciation is provided on a straight line basis on all tangible fixed assets at rates calculated to allocate the assets' cost less estimated residual value over their estimated useful lives.
The depreciation periods are:
Computer equipment three years
Fixtures and fittings nine years
Furniture ten years
Office equipment five years
1.3.9 Income Tax is not provided as the trust has charitable status for tax purposes.
1.3.10 G.S.T. inclusive accounting has been adopted, as the trust is not registered for G.S.T.
1.4 Changes in Accounting Policies
There have been no changes in accounting policies. All policies have been consistently applied.
2. Income From Investments
2001 2000
$ $
Interest 2,910,875 2,937,540
Dividends 1,797,178 2,760,504
Gains on disposals of investments 1,658,103 480,470
Foreign exchange gain 5,260,222 4,428,023
Changes in investment value (16,123,798) 8,843,721
(4,497,419) 19,450,258
Less fund managers' expenses 307,395 296,349
(4,804,814) 19,153,909
3. Investments in Managed Funds
2001 2000
$ $
Opening balance 139,408,426 128,621,796
Gross income (5,324,420) 14,725,400
Withdrawals to fund donations (13,814,457) (3,938,770)
Closing balance 120,269,549 139,408,426
Investments comprise-
Bonds 45,066,697 45,140,717
Equities 75,202,852 94,267,709
Total managed funds- 120,269,549 139,408,426
Held in:
New Zealand: Bonds 25,889,620 27,702,438
Equities 10,752,300 20,174,282
36,641,920 47,876,720

Off shore Bonds 19,177,077 17,438,279
Equities 64,450,552 74,093,427
83,627,629 91,531,706
120,269,549 139,408,426
4. Fixed Assets
Fixtures, fittings and equipment at cost 128,307 117,157
Less accumulated depreciation 91,476 76,207
36,830 40,950
5. Cash and Bank Deposits
Current accounts 4,162 7,760
Call accounts 2,665,884 1,197,658
Petty cash 36 63
Short term deposits 14,263,000 8,025,000
16,933,082 9,230,481
6. Donations Payable
Included in donations payable are $3,516,918 (2000 - $2,340,800) of donations, which are subject to the applicants fulfilling certain conditions.
7. Reconciliation of Net Surplus With Operating Cash Flows
2001 2000
$ $
Net surplus for the period- (17,262,118) 10,554,448
Adjust for non-cash items:
Income on investments 6,016,270 (14,491,710)
Depreciation 15,269 14,762
Movements in net current assets:
Accrued income 71,989 (57,064)
Donations and sundry payables 2,753,982 1,097,967
Net operating cash flows (8,404,608) (2,881,597)
8. Contingent Liabilities and Commitments
Commitments
The trust is committed to $2,971,784 ($7,230,000- 2000) for the "Shooting Star Community Project" and future funding of $1,000,000 ($560,000 - 2000) for the four sports trusts in the region.
Lease Commitments (including G.S.T.)
2001 2000
$ $
Within 1 year 39,375 33,750
1-2 years 39,375 33,750
2-5 years 21,791 52,151
100,541 119,651
A six-year renewal option exists
Contingencies
The trust's charitable status is currently under review by the Inland Revenue Department. The trustees consider that any amount which may be payable following the review is unlikely to be material.
9. Segmental Reporting
The trust operates as a charitable trust distributing funds to the community in the central North Island region.
10. Financial Instruments
Financial instruments include short-term deposits, New Zealand bonds, international bonds, derivatives and investments in managed funds both within New Zealand and overseas.
10.1 Credit Risk
The trustees regularly review their investment strategy. The investment strategy ensures an appropriate diversification of investments so that the trust has no significant concentration of counterparty or credit risk.
10.2 Fair Values
The trust has recorded its financial assets and liabilities at current market values, which represent estimated fair values and credit risk exposure.
10.3 Currency Risk
The trust has exposure to currency risk through its investments in offshore equities and bonds. The current investment policy requires full hedging of currency risk for overseas bonds and 50% hedging of currency risk for overseas equities. This is managed by fund managers with a range of tolerance.
10.4 Credit Facilities
The trust has no credit facilities.
10.5 Interest Rate Risk
The trust investments in fixed rate securities are subject to interest rate risk.
11. Net Current Assets
Cash, bank deposits and accrued income are expected to be realised within 12 months. All liabilities are due within 12 months.
Audit Report
To the Trustees of Eastern & Central Community Trust Inc.
We have audited the consolidated financial report on pages 5 to 13. The consolidated financial report provides information about the past financial performance and financial position of Eastern & Central Community Trust Inc. group (the trust) as at 31 March 2001. This information is stated in accordance with the accounting policies set out on pages 9 and 10.
Trustees' Responsibilities
The trustees are responsible for the preparation, in accordance with New Zealand law and generally accepted accounting practice, of a financial report which gives a true and fair view of the financial position of the trust as at 31 March 2001 and of the results of its operations and cash flows for the year ended 31 March 2001.
Auditors' Responsibilities
It is our responsibility to express an independent opinion on the financial report 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 consolidated financial report. It also includes assessing:
? the significant estimates and judgements made by the trustees in the preparation of the consolidated financial report; 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 consider necessary in order to provide us with 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 the information in the financial report.
Other than in our capacity as auditors, we have no relationship with or interests in the trust.
Unqualified Opinion
We have obtained all the information and explanations we have required.
In our opinion, the consolidated financial report on pages 5 to 13 fairly reflects the financial position of the trust as at 31 March 2001 and the results of its operations and cash flows for the year ended on that date.
Our audit was completed on 26 June 2001 and our unqualified opinion is expressed as at that date.




DENT ROBERTSON & PARTNERS
Chartered Accountants
Hastings, New Zealand
Schedule of Community Payments for the Year Ended 31 March 2001
Donations by Region
2001 2000
$ $
Poverty Bay 1,174,173 795,832
Hawke's Bay 5,154,037 2,904,475
Tararua 918,610 521,610
Wairarapa 1,053,594 884,870
Manawatu 2,791,562 1,898,537
Horowhenua 388,106 543,934
Regional 325,050 345,110
Total donations 11,805,132 7,894,368
An itemised list of all donations is available at www.ecct.org.nz or free of charge from the Trust Manager, Eastern & Central Community Trust Inc., P.O. Box 1058, Hastings.