3372
THE NEW ZEALAND GAZETTE
No. 123

STATEMENT OF CHANGES IN FINANCIAL POSITION YEAR ENDED 31 MARCH 1986

Funds were provided:
From Operations
Tax paid profits
Adjustment for items not involving movement of funds:
Depreciation
Increase in deferred taxation
Trusteebank Travel on consolidation
Less: Investment amortisation
Extraordinary items
Prior year adjustments
Provision for donations

Total funds from operations
From other sources
Increases in depositors balances
Repayments of Principal

• New Zealand Government and Local Authority Stock
• Mortgages
• Term and personal loans

Funds were applied to:
New Investments in—

• New Zealand Government and Local Authority Stock
• Mortgages
• Overdraft and Trusteebank Visa (net)
• Term and personal loans
  Fixed assets additions (net)
  Decrease in long term borrowing
  Increase in working capital

NOTES TO THE ACCOUNTS

1. Statement of Accounting Policies:
   (a) Basis of Consolidation—
   The consolidated accounts include the accounts of the Trusteebank and its wholly owned subsidiary. Eastern and Central Trusteebank Travel Limited.

(b) Changes in Accounting Policies—
There has been one change in accounting policy which has had a material affect on the determination of profit for the year and on the accumulated reserves.
From 1. 4.85 Stationery Stock has been treated as an expense in the year purchased. The effects of this change have been a reduction in profit this year of $53,487.00 and a prior year adjustment to Reserves of $149,313.00 (decrease).

(c) General Accounting Policies—
(i) The measurement base adopted in the preparation of these financial statements is that of historical cost modified by the revaluation of land and buildings. Reliance is placed on the fact that the Bank is a going concern.
(ii) Accrual accounting is used to match expenses and revenue.

(d) Particular Accounting Policies—
(i) Interest Income—Interest is recognised on an accrual basis. Personal loan income excludes unearned interest, and has been apportioned according to the Rule of 78 method.
(ii) Depreciation—The cost or revalued amount of fixed assets (excluding land) less estimated residual value is allocated over their economic lives on a straight line basis. The range of economic lives of the major classes of assets is:
Buildings
Computer and office equipment
Furniture and fittings
Motor vehicles
(iii) Current Assets—Sundry debtors are valued at expected realisable value.
(iv) Investments—Investments are shown at cost with the exception of Government and Local Authority securities.
Government and Local Authority securities are normally held at maturity and redeemed at their face value.
Due provision is made for the difference between cost and face value by the amortisation of the discount or premium on purchase, over the term of the security on a straight line basis.
In accordance with this policy the amortisation credited to revenue for this financial year amounts to $104,042. (1985: $139,765).

2. Investments:
   The realisable value of fixed market securities fluctuates with movements in market yields and it is customary for such fluctuations to be disregarded in the recording of the results of the long term institutional investor.

Estimated market value of N.Z. Government Stock at 31 March 1986, $59,918,481. (March 1985, $63,177,449).