28 JULY THE NEW ZEALAND GAZETTE 2445

Investments—
1983 1982
N.Z. Government stock 19,961,500 16,865,500
(face value)
Local authority securities 60,000 2,279,933
Mortgages 24,918,210 23,819,595
Personal loans 1,864,037
Less interest yet
to mature 318,978
1,545,059 1,169,072
Term loans 1,698,688 444,658
Visa/overdrafts 253,992 144,886
48,437,449 44,723,644

Fixed assets: (note 2)
Land 126,273 125,817
Buildings 416,967 348,583
543,240 474,400
Leasehold premises 19,411 12,645
Office equipment and
furniture 386,675 322,245
Motor vehicles 51,042 37,294
1,000,368 846,584
Premium paid on purchase
of Government stock 25,085 25,085
$56,274,979 $49,382,177

Profit and Loss Account for Year Ending 31 March 1983

                                1983            1982
                                $           $

Interest credited and accrued
to depositors 4,191,086 3,424,263
Charges and administration
expenditure 2,041,540 1,680,110
Depreciation 104,355 78,925
Trustees fees 15,050 15,269
Provision for taxation 135,997 179,719
Nett profit to profit and loss
appropriation account 166,219 219,627
$6,654,247 $5,597,943

                    1983        1983        1982
                    $       $       $

Interest—
N.Z. Government stock 1,832,770 1,582,723
Local authorities 63,764 212,425
Fixed deposits 677,578 464,503
Visa/overdrafts 53,307 16,929
Mortgages 3,481,069 3,002,573
Personal loans 265,265 183,429
Term received 124,215 40,362
Total investment income 6,497,968 5,502,944
Commission, brokerage etc. 104,247 87,004
Profit on sale of Government
stock 45,392
Rents received 6,640 7,995
$6,654,247 $5,597,943

Profit and Loss Appropriation Account for Year Ending 31 March 1983

Provision for grants 35,000 35,00
Balance to reserve fund 145,411 193,901
$180,411 $228,901

Nett profit from profit and
loss account 166,219 219,657
Refund of income tax 14,192 9,244
$180,411 $228,901

A. H. CARLTON, President.

D. R. PARKER, General Manager.

Auditors' Report

We the undersigned, being the auditors of the South Canterbury Savings Bank appointed in terms of section 29 (3) of the Trustee Savings Banks Act 1948, report that: we have examined the balance sheet and accompanying financial statements and notes to the accounts for the year ended 31 March 1983. Our examination was made in accordance with the general principles of auditing and included such tests of the accounting records and such other auditing procedures as we considered necessary in the circumstances.

We have obtained all the information and explanations that we have required and in our opinion proper books of account have been kept by the bank and the accompanying balance sheet together with the profit and financial loss account and the notes attached thereto give a true and fair view of the the financial position of the bank as at 31 March 1983 and the results of its operations and the source and application of funds for the year then ended.

Dated at Timaru this 23rd day of May 1983.

HUBBARD CHURCHER & CO., Chartered Accountants.

Notes to Accounts for Year Ended 31 March 1983

Statement of accounting policies—The general accounting principles recommended by the New Zealand Society of Accountants for the measurement and reporting of profit on an historical cost basis have been followed by the bank.

The following particular accounting policies have been applied.

(a) Recognition of Income and Expenditure—
• Investment income includes interest accrued to 31 March.
• Interest on personal loans is added at the commencement of the loan. This amount is brought into revenue during the appropriate financial years by applying the "Rule of 78".
• Interest on savings and current accounts represents interest credited at 31 March and the interest paid on closed accounts during the year. Investments accounts which are credited with interest during the year have an appropriate adjustment made for the interest accrued to 31 March.
• Interest paid and accrued on depositors' investment accounts has been calculated at the full rate payable on the assumption that all deposits will reach maturity.

(b) Fixed Assets and Depreciation—
(a) The fixed assets, have been depreciated at depreciation rates approved by the Inland Revenue Department. Computer equipment has been depreciated at the first year rate of 25 percent of cost price and there after at 20 percent of the diminishing value each year. All assets still in use are included in the books and it is calculated that the depreciation rates being used will write off the items over the period of their useful lives. In accordance with the bank's established policy no additional depreciation as provided for in the rates set by the Inland Revenue Department on the purchase of assets (other than the computer equipment) have been claimed for taxation purposes.
(b) It is considered that the amount charged in the profit and loss account does not differ materially from that which would result from calculating depreciation had the straight line method been adopted.

(c) Investments—The New Zealand Government stock and local authority securities have generally been held to maturity but in the year just ended there has been a departure from this practice. The bank has replaced a number of its investments in order to obtain an improved yield over a longer term but at the present time it does not intend to engage in trading in investments as part of normal business activities. The stock and securities are recorded at face value on purchase. Premium redemptions and discounts due on maturity of Government stock purchased under par are held in reserve to be brought into account upon maturity or sale of the stock concerned. Similarly any premium paid on the purchase of Government stock is also held in reserve to be written off as a loss on maturity or earlier sale of the particular stock.

(a) Taxation—The amount provided for income tax is the amount of the calculated tax liability in respect of the accounting profit shown for the year by the profit and loss account.

Note 2

                            1983                1982
                            Accumu-         Accumu-
                            lated           lated
                            Deprecia-   Book        Deprecia-   Book
                Cost        tion    Value       Cost        tion    Value
                $       $   $       $       $   $

Fixed assets: 1983 1982
Land 126,273 — 126,273 125,817 — 125,817
Buildings 459,565 42,598 416,967 381,990 33,407 348,583
585,838 42,598 543,240 507,807 33,407 474,400
Leasehold premises 29,953 10,542 19,411 26,055 13,410 12,645
Office equipment
and furniture 763,757 377,082 386,675 618,904 296,659 322,245
Motor vehicles 67,244 16,202 51,042 50,506 13,212 37,294
$1,446,792 $446,424 $1,000,368 $1,203,272 $356,688 $846,584

The bank owns property in Timaru, Temuka, Fairlie, Waimate, Ashburton, Methven, and Geraldine. It leases property in Winwald, Pleasant Point, Methven, and Timaru. The leases have been negotiated to provide long-term tenancy options.