Notice Type
General Section
Notice Title

ASB Bank Community Trust

Statement of Financial Performance for the Year Ended 31 March 2006
Note 2006 2005
$000 $000
Income received from:
Investments 2 93,210 36,351
Other income 438 665
Total income for the year 93,648 37,016
Direct expenditure incurred:
Fund management, custodian and advisory fees 730 708
92,918 36,308
Other expenditure incurred 8 1,246 904
Net surplus for year 91,672 35,404
Statement of Movement in Trust Funds for the Year Ended 31 March 2006
Net surplus for year 91,672 35,404
Less grants committed during year 6.1 (33,069) (22,152)
Total trust funds 460,670 447,418
519,273 460,670
Trust funds received from ASB Charitable Trust on distribution 3 524,670 –
Total trust funds 1,043,943 460,670
The notes to these financial statements form part of and should be read in conjunction with this statement of income and expenditure and statement of movement in trust funds.
Statement of Financial Position as at 31 March 2006
Note 2006 2005
$000 $000
Current assets:
Cash at bank 18 5
Sundry accounts receivable 3 –
21 5
Fixed assets 4 1,983 –
Investments:
Managed funds 5.1 1,089,043 488,866
Other investments 5.2 1,224 317
Total investments 1,090,267 489,183
Total assets 1,092,271 489,188
Less liabilities:
ASB Charitable Trust inter-trust current account – 106
Sundry accounts payable 794 183
Outstanding grants payable 6.2 47,534 28,229
48,328 28,518
Net assets at 31 March 1,043,943 460,670
Represented by—
Trust funds:
Original capital 7.1 579,106 327,320
Capital maintenance reserve 7.2 169,761 32,142
General reserve 7.3 200,000 75,000
Community innovation reserve 7.4 65,000 –
Retained surplus 7.5 30,076 26,208
1,043,943 460,670
Approved on behalf of the board:
S. K. PRIME, Chairman
P. N. SNEDDEN, Deputy Chairman.
Date: 29 May 2006.
The notes to these financial statements form part of and should be read in conjunction with this balance sheet.
Statement of Cash Flows for the Year Ended 31 March 2006
Note 2006 2005
$000 $000
Cash flows from operating activities—
Cash was provided from:
Income received on other investments 438 665
Cash was disbursed on:
Payment to suppliers, trustees and staff (63) (59)
Refunds to ASB Charitable Trust for the services of suppliers, trustees and staff (859) (821)
Fund management and advisory fees (771) (690)
(1,693) (1,570)
Net cash outflow from operating activities 12 (1,255) (905)
Cash flows from investing activities—
Cash was provided from:
Receipts from fund managers 43,736 29,546
Cash was disbursed on:
Transfers to fund managers (12,000) (9,942)
Net cash inflow from investing activities 31,736 19,604
Cash flows from funding activities—
Cash was disbursed on:
Grants to community organisations (30,185) (18,913)
Net cash outflow from funding activities (30,185) (18,913)
Net cash (outflow)/inflow from activities 296 (214)
Add: Cash at bank 1 April 2005 322 536
ASB Charitable Trust cash received on distribution 624 –
Cash at bank at 31 March 2006 1,242 322
Cash at bank at 31 March 2006 comprises:
Cash at bank 18 5
Call deposits 1,224 317
1,242 322
The notes to these financial statements form part of and should be read in conjunction with this statement of cash flows.
Notes to the Financial Statements for the Year Ended 31 March 2006
1. Statement of Accounting Policies
The ASB Bank Community Trust (“the trust”) is the reporting entity. The trust was formed on 30 May 1988 through the creation of a trust deed in compliance with the Trustee Banks Restructuring Act 1988. Under the terms of the trust deed,
the trust was settled with 60 million $1 fully paid ordinary shares in ASB Bank Limited representing 100% of the issued capital. As at 31 March 1988, the net tangible asset backing of those 60 million shares was $147,655,000. In 1989, 45 million shares were sold to the Commonwealth Bank of Australia for $252,000,000 which was then donated to the ASB Charitable Trust. In October 2000, the remaining 15 million shares were sold to the Commonwealth Bank of Australia for $545,000,000.
On 27 February 2006, the trustees of the ASB Charitable Trust resolved to distribute, on or before 31 March 2006, the capital of that trust (including all accumulations of income and capital to that date less accrued liabilities) in specie to the ASB Bank Community Trust. Subsequent to this distribution, the trustees intend to formally wind up the ASB Charitable Trust.
The measurement basis adopted is that of historical cost adjusted for the revaluation of certain assets. Reliance is placed on the fact that the trust is a going concern. The financial statements have been prepared in accordance with the requirements of
the Financial Reporting Act 1993.
Consolidated Financial Statements
Consolidated financial statements have not been prepared as the subsidiary companies have not traded since incorporation.
Statement of Cash Flows
Cash comprises cash at bank and call deposits but does not include cash or deposits held by the fund managers. Therefore, the statement of cash flows does not reflect the cash flows within the fund managers’ portfolios.
Dividends, pooled funds and interest
Dividends are recognised as income on declaration date, and are recorded net of any imputation tax credits. Income from pooled funds is recognised on declaration date. Interest is recognised as income on an accrual basis.
Grants
Grants are accounted for as they are committed to be distributed to eligible organisations as approved by the trustees.
Expenses
Some expenses are shared jointly with the ASB Charitable Trust. Whilst each trust bears its own specific costs, the joint expenses are allocated between each trust on the basis of the number of applications processed by each.
Joint expense allocations were:
2006 2005
This trust 50% 50%
ASB Charitable Trust 50% 50%
Fixed Assets
Fixed assets are valued at cost, less accumulated depreciation.
Depreciation
Depreciation is provided over the useful life of the assets. Buildings are depreciated on a straight line basis. Vehicle, office equipment and furniture are depreciated on a diminishing value basis. The rates used are those recommended by the Inland Revenue Department.
Land and buildings 2.5% – 3.0%
Office equipment and furniture 9.5% – 48.0%
Foreign Currencies
All amounts denominated in foreign currencies are converted to New Zealand dollars at balance date and all realised and unrealised gains and losses are recognised in income and expenditure for the period.
Investments
Investment in managed funds and other investments are stated at market value. Any gains or losses are recognised in income and expenditure for the period. Investment transactions are recorded by the fund managers on a trade date basis.
Financial Instruments
All assets and liabilities of the trust are financial instruments and are recognised in the statement of financial position. All financial instruments are recorded at market value which equates to fair value.
The trust uses financial instruments to reduce exposure to fluctuations in foreign currency exchange rates. Forward exchange contracts are entered into to hedge foreign currency transactions. These are converted to the New Zealand dollar rate at balance date with all realised and unrealised gains and losses being recognised in the income and expenditure statement.
The quantitative disclosures required by FRS 31 Disclosure of Information about Financial Instruments have been included throughout the financial statements where material.
Reserves
Transfers to the capital maintenance reserve are based on the annual movement in the consumer price index. Transfers to all other reserves from the unallocated surplus are made at the discretion of the trustees.
Taxation
The Income Tax Act 1994 provides exemption from income tax for Community Trusts established under the Trustee Banks Restructuring Act 1988. The amendment applied from the 2005 income year, and consequently no taxation has been provided for in these financial statements.
Changes in Accounting Policies
There have been no material changes in accounting policies during the period.
2006 2005
$000 $000
2. Income
Investments:
Pooled funds 95,246 3,565
Dividends 2,669 2,224
Interest 6,514 7,374
Realised gains 7,426 3,580
Unrealised gains 4,892 733
Realised foreign exchange gains (3,490) 13,892
Unrealised foreign exchange gains/(losses) (20,047) 4,983
93,210 36,351
3. Distribution of ASB Charitable Trust Funds
The following trust funds, assets and liabilities were received by way of distribution from the ASB Charitable Trust:
Trust funds:
Original capital 251,786
Capital maintenance reserve 125,243
General reserve 75,000
Retained surplus 72,641
Total trust funds 524,670
Investments:
Managed funds 538,703
Call deposits 614
Total investments 539,317
Current assets:
Cash at bank 10
Sundry accounts receivable 3
Total current assets 13
Fixed assets (at depreciated values):
Land and buildings 1,800
Office furniture and equipment 183
Total fixed assets 1,983
Sundry accounts payable 651
Outstanding grants payable
Committed in prior years 4,336
Committed this year 12,086
Total committed unpaid grants 16,422
4. Fixed Assets
Fixed assets received on distribution of ASB Charitable Trust Fund:
2006
Cost AccumulatedDepreciation Book Value
$000 $000 $000
Land and buildings 2,079 279 1,800
Office equipment and furniture 733 550 183
Total fixed assets 2,812 829 1,983
2006 2005
$000 $000
5. Investments
5.1 Managed by External Managers
Balance as at 1 April 488,866 472,120
Movement in market value and investment income 93,210 36,350
Net withdrawals (31,736) (19,604)
Investments received on distribution from ASB Charitable Trust 538,703 –
1,089,043 488,866
Investments managed by external managers comprise:
Cash, deposits and miscellaneous 33,083 29,793
Bonds 467,913 212,279
Equities 588,047 246,794
Portfolio total 1,089,043 488,866
5.2 Other Investments Comprise
Call deposits 610 317
Call deposits distributed by ASB Charitable Trust 614 –
1,224 317
2006 2005
$000 $000
6. Grants
6.1 For This Year
Committed and disbursed 8,651 6,499
Committed but not yet disbursed 25,814 16,617
Total grants approved 34,465 23,116
Grants written back (1,396) (964)
Grants committed this year 33,069 22,152
6.2 Outstanding Grants Payable
Committed in previous years 5,298 11,619
Committed this year 25,814 16,610
31,112 28,229
Liability assumed for outstanding grants payable on distribution of ASB Charitable Trust Fund:
Committed in previous years 4,336 –
Committed this year 12,086 –
47,534 28,229
7. Trust Funds and Reserves
7.1 Trust Capital
Original capital 327,320 327,320
Original capital received on distribution from ASB Charitable Trust 251,786 –
Total trust capital 579,106 327,320
7.2 Capital Maintenance Reserve
Opening balance 32,142 22,252
Transfer from surplus 12,376 9,890
Capital maintenance reserve received on distribution from ASB Charitable Trust 125,243 –
Total capital maintenance reserve 169,761 32,142
7.3 General Reserve
Opening balance 75,000 50,000
Transfer from retained surplus 50,000 25,000
General reserve received on distribution from ASB Charitable Trust 75,000 –
Total general reserve 200,000 75,000
7.4 Community Innovation Reserve
As a result of the exceptional investment returns achieved in the 2005/06 year, the trustees resolved to establish a community innovation reserve of $65 million. The fund will be administered according to specific policies and guidelines which will be developed during the 2006/07 financial year.
Balance at 1 April – –
Transfer from retained surplus 65,000 –
Total community innovation reserve 65,000 –
7.5 Retained Surplus
Retained surplus 72,435 51,208
Retained surplus received on distribution from ASB Charitable Trust 72,641 –
145,076 51,208
Less: Transfer to general reserve (50,000) (25,000)
Transfer to community innovation reserve (65,000) –
Total retained surplus 30,076 26,208
These reserves maintain the capital base of the trust.
8. Other Expenditure
Audit fees 18 20
Facilities rental 33 33
Legal fees 9 3
Occupancy costs 61 47
Other operating costs 256 140
Public and statutory reporting 72 79
Staff expenses 644 444
Trustees’ fees 97 92
Trustees’ expenses 56 46
1,246 904
9. Related Party Information
The trust donated funds to establish the ASB Charitable Trust. Joint expenses are charged to this trust by ASB Charitable Trust.
The following companies were established by the trust:
Name Interest Held Balance Date Principal Activity
ASB Trusts Amateur Public Sports Promotion Limited 100% 31 March Donations to amateur sport bodies
ASB Trusts Public Amenities Development Limited 100% 31 March Grants to public beautification bodies
These subsidiaries were incorporated on 29 March 2001. They have not traded since incorporation.
10. Financial Instruments
Currency Risk
The trust invests in securities that are denominated in foreign currencies and therefore result in a currency risk. In order to minimise the currency risk, foreign currency assets are hedged.
2006 2005
$000 $000
Foreign currency denominated assets 373,212 295,202
Less foreign currency contracts 270,760 198,400
ASB Charitable Trust currency risks assumed on distribution:
Foreign currency denominated assets 340,651 –
Less foreign currency contracts 246,165 –
Total unhedged exposure at 31 March 196,938 96,802
Interest Rate Risk
The trust, through its fund managers, invests in securities that are subject to interest rate risk. The trust actively monitors this risk and changes asset allocations and maturity profiles accordingly.
Credit Risk
The trust, in the normal course of business, enters into arrangements with other parties. These arrangements give rise to credit risk for the trust and hence policies and procedures are maintained so that this risk is minimised.
For all classes of financial assets held by the trust, the maximum credit risk exposure to the trust is the carrying value.
Due to the diversification of the investment portfolio and the policies and procedures in place, there is no significant concentrations of credit risk. No collateral is required in respect of financial assets.
Fair Values
All financial instruments are carried at market value which equates to fair value.
11. Foreign Currency Monetary Assets
As at 31 March, prior to distribution by the ASB Charitable Trust, the trust had the following foreign currency monetary assets that were not hedged.
2006 2005
$000 $000
Foreign currency exposure—
Receivables stated in NZ$ equivalents:
U.S.A. and Canada 53,623 56,339
U.K. and Continental Europe 34,301 30,880
Japan and Far East 14,528 9,583
102,452 96,802
Foreign currency monetary assets received on distribution from the ASB Charitable Trust—
Receivables stated in NZ$ equivalents:
U.S.A. and Canada 49,454 –
U.K. and Continental Europe 31,634 –
Japan and Far East 13,398 –
Total foreign currency assets received on distribution 94,486 –
As at 31 March, the trust had the following foreign currency monetary assets (including assets received on distribution from the ASB Charitable Trust) that were not hedged.
U.S.A. and Canada 113,632 56,339
U.K. and Continental Europe 60,263 30,880
Japan and Far East 23,043 9,583
Total foreign currency exposure at 31 March 196,938 96,802
12. Reconciliation of Reported Surplus to Net Cash Flow From Operating Activities
Reported surplus 91,672 35,404
Movements in working capital items:
Decrease in creditors (41) (6)
Decrease/(increase) in debtors – 22
Increase in ASB Charitable Trust 324 25
283 41
Fund managers’ income reinvested (93,210) (36,350)
Net cash outflow from operating activities (1,255) (905)
13. Non Cash Flow Items
The inter-trust current account with the ASB Charitable Trust was settled by way of set off on the distribution of the charitable trust’s capital fund.
14. Capital Commitments and Contingent Liabilities
Other than committed donations, the trust has no other capital commitments or contingent liabilities.
15. Conflicts of Interest
During the year, trustees and staff were required to declare either a direct or indirect conflict of interest in a matter being considered by the trust. Twenty-three such interests were recorded during the year and a register is available for inspection at the trust.
16. Adoption of International Financial Reporting Standards
In December 2002, the New Zealand Accounting Standards Review Board announced that New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) will apply to all New Zealand entities for financial reporting periods commencing on or after 1 January 2007.
The trust has commenced assessing the differences between accounting policies under NZ IFRS and current accounting policies to identify key areas of the financial statements that will be impacted by the transition to NZ IFRS. This review has not been completed at balance date.
Audit Report
To the Trustees of ASB Bank Community Trust:
We have audited the financial statements. The financial statements provide information about the past financial performance of the ASB Bank Community Trust (“the trust”) and its financial position as at 31 March 2006. This information is stated in accordance with the accounting policies.
Trustees’ Responsibilities
The trustees are responsible for the preparation of financial statements which give a true and fair view of the financial position of the trust as at 31 March 2006 and the results of its operations and cash flows for the year ended on that date.
Auditors’ 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 report. It also includes assessing:
? the significant estimates and judgements made by the trustees in the preparation of the financial statements;
? whether the accounting policies are appropriate to the trust’s circumstances, consistently applied and adequately disclosed.
We conducted our audit in accordance with New Zealand Auditing Standards. 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 obtain 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.
Our firm has also provided other services to the trust in relation to taxation advisory services. These matters have not impaired our independence as auditors of the trust. The firm has no other relationship with, or interest in, the trust.
Unqualified Opinion
We have obtained all the information and explanations we have required.
In our opinion:
? proper accounting records have been kept by the trust as far as appears from our examination of those records;
? the financial statements:
– comply with New Zealand generally accepted accounting practice;
– give a true and fair view of the financial position of the trust as at 31 March 2006 and the results of its operations and cash flows for the year ended on that date.
Our audit was completed on 29 May 2006 and our unqualified opinion is expressed as at that date.
KPMG, Auckland.
———————
ASB Charitable Trust
Statement of Financial Performance for the Year Ended 31 March 2006
Note 2006 2005
$000 $000
Income:
Investments 3 93,433 37,513
Rent and other income 537 711
93,970 38,224
Direct expenditure:
Fund management, custodian and advisory fees 2,047 1,896
91,923 36,328
Other expenditure 7 1,240 881
Net surplus 90,683 35,447
Statement of Movement in Trust Funds for the Year Ended 31 March 2006
Net surplus 90,683 35,447
Committed grants 5 (21,877) (20,236)
Total trust funds at beginning of year 455,864 440,653
524,670 455,864
Trust funds distributed to ASB Bank Community Trust (524,670) –
Total trust funds at 31 March Nil 455,864
The notes to these financial statements form part of and should be read in conjunction with this statement of income and expenditure and statement of movement in trust funds.
Statement of Financial Position for the Year Ended 31 March 2006
Note 2006 2005
$000 $000
Current assets:
ASB Bank Community Trust 430 106
Cash at bank 10 5
Sundry accounts receivable 3 77
Total current assets 443 188
Investments:
Managed funds 2 538,703 466,869
Other investments 2 614 997
Total investments 539,317 467,866

Fixed assets 6 1,983 1,943
541,300 469,997
Less assets transferred to ASB Bank Community Trust on distribution 1 (541,743)
Total assets at 31 March Nil 469,997
Less liabilities:
Sundry accounts payable 651 603
Outstanding grants payable 5 16,422 13,530
17,073 14,133
Less liabilities transferred to ASB Bank Community Trust on distribution 1 (17,073) –
Total liabilities Nil 14,133
Net assets at 31 March Nil 455,864
Represented by—
Trust funds:
Capital 251,786 251,786
Capital maintenance reserve 4 125,243 112,694
General reserve 4 75,000 75,000
Retained surplus 72,641 16,384
524,670 455,864
Less trust funds distributed to ASB Bank Community Trust (524,670) –
Trust funds at 31 March Nil 455,864
Approved on behalf of the board:
S. K. PRIME, Chairman
P. N. SNEDDEN, Deputy Chairman.
Date: 29 May 2006.
The notes to these financial statements form part of and should be read in conjunction with this balance sheet.
Statement of Cash Flows for the Year Ended 31 March 2006
Note 2006 2005
$000 $000
Cash flows from operating activities—
Cash was provided from:
Income received on other investments 115 703
Refunds of expenses by ASB Bank Community Trust 859 821
Net GST 152 –
Receipts from rentals and other income 270 8
1,396 1,532
Cash was disbursed on:
Net GST – (2)
Payment to suppliers, trustees and staff (2,129) (1,648)
Fund management and advisory fees (2,132) (1,931)
(4,261) (3,579)
Net cash outflow from operating activities 11 (2,865) (2,047)
Cash flows from investing activities—
Cash was provided from:
Receipts from fund managers 31,599 30,030
Cash was disbursed on:
Purchase of fixed assets (127) (19)
Transfers to fund managers (10,000) (3,000)
(10.127) (3,019)
Net cash inflow from investing activities 21,472 27,011
Cash flows from funding activities—
Cash was disbursed on:
Grants to charitable organisations (18,985) (25,202)
Net cash outflow from funding activities (18,985) (25,202)
Net cash (outflow)/inflow from activities (378) (238)
Add opening cash brought forward 1,002 1,240
Distribution to ASB Bank Community Trust (624)
Ending cash Nil 1,002
Cash at year end comprised:
Cash at bank – 5
Call deposits – 997
Nil 1,002
The notes to these financial statements form part of and should be read in conjunction with this statement of cash flows.
Notes to the Financial Statements for the Year Ended 31 March 2006
1. Statement of Accounting Policies
The ASB Charitable Trust (“the trust”) is the reporting entity. The trust was formed on 31 May 1989 through the creation of
a trust deed by the ASB Bank Community Trust and a donation of $252,000,000.
On 27 February 2006, the trustees of the ASB Charitable Trust resolved to distribute, on or before 31 March 2006, the capital of that trust (including all accumulations of income and capital to that date less accrued liabilities) in specie to the ASB Bank Community Trust. Subsequent to this distribution, the trustees intend to formally wind up the ASB Charitable Trust.
The measurement basis adopted is that of historical cost adjusted for the revaluation of certain assets. Reliance is placed on the fact that the trust is a going concern within the ASB Bank Community Trust. The financial statements have been prepared in accordance with the requirements of the Financial Reporting Act 1993.
Statement of Cash Flows
Cash comprises cash at bank and call deposits but does not include cash or deposits held by the fund managers. Therefore, the statement of cash flows does not reflect the cash flows within the fund managers’ portfolios.
Depreciation
Depreciation is provided over the useful life of the assets. Buildings are depreciated on a straight line basis. Vehicle, office equipment and furniture are depreciated on a diminishing value basis. The rates used are those recommended by the Inland Revenue Department.
Land and buildings 2.5% – 3.0%
Vehicle 31.2%
Office equipment and furniture 9.5% – 48.0%
Dividends, Pooled Funds and Interest
Dividends are recognised as income when they are receivable by the trust and exclude imputation tax credits. Income from pooled funds is recognised on declaration date. Interest income is recognised on an accrual basis.
Grants
Grants are accounted for as they are committed to be distributed to eligible organisations as approved by the trustees.
Expenses
Some expenses are shared jointly with the ASB Bank Community Trust. Whilst each trust bears its own specific costs, the joint expenses are allocated between the trusts on the basis of the number of applications processed by each.
Joint expense allocations were:
2006 2005
This trust 50% 50%
ASB Bank Community Trust 50% 50%
Fixed Assets
Fixed assets are valued at cost less accumulated depreciation.
Foreign Currencies
All amounts denominated in foreign currencies are converted to New Zealand dollars at balance date and all realised and unrealised gains and losses are recognised in income and expenditure for the period.
Investments
Investments are stated at market value. Any gains or losses are recognised in income and expenditure for the period. Investment transactions are recorded by the fund managers on a trade date basis.
Financial Instruments
All assets and liabilities of the trust with the exception of fixed assets are financial instruments and are recognised in the statement of financial position. All financial instruments are recorded at market value which equates to fair value.
Financial Instruments (continued)
The trust uses financial instruments with off balance sheet risk to reduce exposure to fluctuations in foreign currency exchange rates. Forward exchange contracts are entered into to hedge foreign currency transactions. These are converted to the
New Zealand dollar rate at balance date with all realised and unrealised gains and losses being recognised in the income and expenditure statement.
The quantitative disclosures required by FRS 31 Disclosure of Information about Financial Instruments have been included throughout the financial statements where material.
Reserves
Transfers to the capital maintenance reserve are based on the annual movement in the consumer price index. Transfers to all other reserves from the unallocated surplus are made at the discretion of the trustees.
Taxation
The trust has been accorded tax exempt status in New Zealand and Australia but is liable to taxation on investment income in some other overseas countries. Tax on overseas income is accounted for as a reduction of that income.
Changes in Accounting Policies
There have been no material changes in accounting policies during the period.
2006 2005
$000 $000
2. Investments
Managed by external managers:
Balance as at 1 April 466,869 456,386
Movement in market value and investment income 93,433 37,513
Net withdrawals (21,599) (27,030)
Distributed to ASB Bank Community Trust (538,703) –
Balance as at 31 March Nil 466,869
Investments managed by external managers comprise:
Cash, deposits and miscellaneous – 22,580
Bonds – 206,453
Equities – 237,836
Portfolio total Nil 466,869
Other investments comprise:
Call deposits 614 997
Distributed to ASB Bank Community Trust (614) –
Nil 997
3. Income
Investments:
Pooled funds 24,717 5,044
Dividends 5,692 3,946
Interest 7,809 7,958
Realised gains – 10,239
Unrealised gains 45,234 4,103
Realised foreign exchange gains/(losses) (15,151) 10,677
Unrealised foreign exchange (losses)/gains 25,132 (4,454)
93,433 37,513
4. Reserves
Capital maintenance reserve:
Balance as at 1 April 2005 112,694 102,666
Transfer from retained surplus 12,549 10,028
Distribution to ASB Bank Community Trust (125,243) –
Balance as at 31 March Nil 112,694
General reserve:
Balance as at 1 April 2005 75,000 50,000
Transfer from retained surplus 25,000
Distribution to ASB Bank Community Trust (75,000) –
Balance as at 31 March Nil 75,000
These reserves maintain the capital base of the trust.
5. Grants
For this year:
Committed and disbursed 10,058 9,534
Committed but not yet disbursed 12,086 11,107
Total grants approved 22,144 20,641
Grants written back (267) (405)
21,877 20,236
Outstanding grants payable:
Committed in previous years 4,336 2,426
Committed this year 12,086 11,104
Distribution to ASB Bank Community Trust (16,422) –
Nil 13,530
6. Fixed Assets
2006 2005
Cost AccumulatedDepreciation Book Value Cost AccumulatedDepreciation BookValue
$000 $000 $000 $000 $000 $000
Land and buildings 2,079 258 1,821 2,079 258 1,821
Vehicle ? ? ? 57 44 13
Office equipment and furniture 733 550 183 645 536 109
Distribution to ASB Bank Community Trust (2,812) (829) (1,983) – – –
Nil Nil Nil 2,781 838 1,943

2006 2005
$000 $000
7. Other Expenditure
Audit fees 19 20
Depreciation – land and buildings 10 10
Depreciation – vehicle – 6
Depreciation – office equipment and furniture 23 17
Legal fees – –
Occupancy costs 74 47
Other operating costs 248 122
Public and statutory reporting 72 79
Staff expenses 644 444
Trustees’ fees 97 92
Trustees’ expenses 53 44
1,240 881
8. Statement of Cash Flows
The depreciation charged to the cash flow statement includes a sum of $34,000 (2005 – $33,736) on-charged to the ASB Bank Community Trust as facilities rental.
9. Financial Instruments
Currency Risk
The trust invests in securities that are denominated in foreign currencies and therefore result in a currency risk. In order to minimise the currency risk, foreign currency assets are hedged.
2006 2005
$000 $000
Foreign currency denominated assets – 298,417
Less foreign currency contracts – 205,343
Unhedged exposure Nil 93,074
Interest Rate Risk
The trust, through its fund managers, invests in securities that are subject to interest rate risk. The trust actively monitors this risk and changes asset allocations and maturity profiles accordingly.
Credit Risk
The trust, in the normal course of business, enters into arrangements with other parties. These arrangements give rise to credit risk for the trust and hence policies and procedures are maintained so that this risk is minimised.
For all classes of financial assets held by the trust, the maximum credit risk exposure to the trust is the carrying value.
Due to the diversification of the investment portfolio and the policies and procedures in place, there is no significant concentration of credit risk. No collateral is required in respect of financial assets.
Fair Values
All financial instruments are carried at market value which equates to fair value.
10. Reconciliation of Reported Surplus to Net Cash Flow From Operating Activities
Reported surplus 90,683 35,447
Add non cash items:
Depreciation 68 68
Loss on disposal of fixed assets 19 –
87 68
Movements in working capital items:
Increase in creditors 48 28
Increase in ASB Bank Community Trust (324) (25)
(Increase)/decrease in debtors 74 (52)
(202) (49)
Fund managers’ income reinvested (93,433) (37,513)
Net cash outflow from operating activities (2,865) (2,047)
11. Capital Commitments and Contingent Liabilities
Other than committed grants, the trust has no other capital commitments or contingent liabilities.
12. Non Cash Flow Items
The inter-trust current account with the ASB Bank Community Trust was settled by way of set-off on the distribution of the trust’s capital fund to the ASB Bank Community Trust.
13. Related Party Information
Fixed assets are held and joint expenses are paid by this trust. Expenses are on-charged to ASB Bank Community Trust.
14 Conflicts of Interest
During the year, trustees and staff were required to declare either a direct or indirect conflict of interest in a matter being considered by the trust. Twenty-one such interests were recorded during the year and a register is available for inspection at the trust.
Audit Report
To the Trustees of ASB Charitable Trust:
We have audited the financial statements. The financial statements provide information about the past financial performance of the ASB Charitable Trust (“the trust”) and its financial position as at 31 March 2006. This information is stated in accordance with the accounting policies.
Trustees’ Responsibilities
The trustees are responsible for the preparation of financial statements which give a true and fair view of the financial position of the trust as at 31 March 2006 and the results of its operations and cash flows for the year ended on that date.
Auditors’ 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 report. It also includes assessing:
? the significant estimates and judgements made by the trustees in the preparation of the financial statements;
? whether the accounting policies are appropriate to the trust’s circumstances, consistently applied and adequately disclosed.
We conducted our audit in accordance with New Zealand Auditing Standards. 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 obtain 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.
Our firm has also provided other services to the trust in relation to payroll and advisory services. These matters have not impaired our independence as auditors of the trust. The firm has no other relationship with, or interest in, the trust.
Unqualified Opinion
We have obtained all the information and explanations we have required.
In our opinion:
? proper accounting records have been kept by the trust as far as appears from our examination of those records;
? the financial statements:
– comply with New Zealand generally accepted accounting practice;
– give a true and fair view of the financial position of the trust as at 31 March 2006 and the results of its operations and cash flows for the year ended on that date.
Our audit was completed on 29 May 2006 and our unqualified opinion is expressed as at that date.
KPMG, Auckland.
A copy of the list of all distributions of income and capital approved by the ASB Bank Community Trust and
ASB Charitable Trust is available on request from ASB Trusts, P.O. Box 68-048, Newton, Auckland.