2230
THE NEW ZEALAND GAZETTE
No. 94

Waikato Savings Bank—continued—
(A) REVENUE AND EXPENSE RECOGNITION—
(a) Personal loan interest has been recognised on the sum of digits basis.
(b) Losses associated with dealings in securities have been deferred on a pro rata basis to the years during which the revenue from the corresponding deals will be recognised during the normal course of business.
(c) The charge for income tax is the amount of tax liability in respect of the accounting profit for the current year. Timing differences between accounting and taxation records are included under the heading “provision for deferred taxation”, with the exception of timing differences which, on the basis of reasonable probability, are expected to continue in the future.

(B) INVESTMENTS—
(a) The Bank’s one-third shareholding in the Northern Trustee Computerbank Ltd., as at the company’s 31 May 1980 balance date has been treated on an equity accounting basis.
(b) New Zealand Government securities have been valued on a purchase yield basis.
(c) Other investments have been recorded at cost plus interest accrued to balance date.

(C) FIXED ASSETS AND DEPRECIATION—
Land is recorded at the higher of original cost or the 1976 Government valuation. All other assets are recorded at cost less depreciation to date. The cost of lease goodwill has been spread evenly over the terms of the leases. Straight-line depreciation as recommended by the New Zealand Society of Accountants Statement of Standard Accounting Practice No. 3, has not otherwise been applied and maximum rates of depreciation as approved by the Commissioner of Inland Revenue have been used. This is not considered to have a significant effect on the financial statements for the year ended 31 March 1981.

(D) CHANGES—
There have been no changes in accounting principles used that would significantly affect profit or financial position.

2. Total Income—
   1981 1980
   $000 $000
   Government and local authority securities 4,526 3,223
   Mortgages, personal loans, etc. 7,639 6,112
   Associated company 8 6
   Other income 2,215 1,042
   $14,388 $10,383

3. Expenses—
   Audit fee 15 10
   Rentals 381 259
   Depreciation 160 159
   Hire purchase interest 20 36
   Deposit interest 8,591 5,807
   Trustees fees 15 8
   Other expenses 4,250 3,388
   $13,432 $9,667

4. Loss on Trading Securities—
   Amortization of loss on trading Government stock (75) (59)
   Other trading profits 20 26
   (55) (33)

5. There is no charge for taxation in the profit statement because the accounting profit is wholly covered by timing differences in respect of accrued interest on securities which have arisen during the year and which are expected to continue in the foreseeable future and which are therefore treated as permanent differences. The cumulative taxation effect of such differences for which deferred taxation has not been provided amounted to $771,567 to 31 March 1981.

6. Reserve Fund Changes—
   Prior year depreciation adjustment — (26)
   Loss on sale of securities 75 (345)
   Provision for future loss written back 21 21
   96 (350)

7. Creditors—
   Hire purchase balances 94 225
   Other 634 359
   728 584

8. Provisions—
   Deferred taxation 358 357
   Donations 70 50
   428 407

9. Reserves—
   Land and buildings revaluation 140 140
   Unallocated loss on sale of securities (270) (345)
   Northern Trustee Computerbank Limited 89 75
   General 3,065 2,190
   $3,024 $2,060

10. New Zealand Government Securities—
    Statutory ratio requirements are based on nominal value of government securities held and current practice generally is to hold such securities to maturity
    Valuation at purchase yields 50,440 41,375
    Nominal value 49,163 40,663
    Market value 42,539 31,373

11. Local Authority Securities—
    Total advances 9,728 9,393
    Less Sales and matured advances 8,503 7,306
    $1,225 $2,087

Nominal value debentures held 754 1,087
Registered stock held 471 1,000
$1,225 $2,087

Market value of registered stock 521 750

12. Personal Loans, Overdraft, Visa Advances—
    Gross advances 5,884 2,499
    Less unearned interest 1,211 301
    $4,673 $2,198

13. Associated Company—
    Northern Trustee Computerbank Limited
    Shares 33 33
    Share of profits 89 75
    Debentures 80 80
    $202 $188

14. Fixed Asset—
    Land (at 1976 valuation) 310 310
    Land (at cost) 33 65
    Land—leasehold 41 41
    384 416

Buildings at cost 2,213 2,025
less accumulated depreciation 57 35
2,156 1,990

Other fixed assets at cost 2,787 2,043
less accumulated depreciation 1,284 1,009
1,503 1,034
$4,043 $3,440

15. Loan Commitments—
    Mortgage advances 3,860 2,364

16. Contingent Liabilities—
    Mortgage advances 60 —
    Other — 92