2054 NEW ZEALAND GAZETTE No. 84

Prior year adjustment 757 -
Less: Losses claimed this year (755) (197)
Total losses to be carried forward 1,445 494

9. Reconciliation of reported surplus to net cashflow from operating activities

                                                                               2000        1999
                                                                              $000        $000

   Surplus for the period (792) 9,332

Add:
Non-cash items:
Depreciation 81 81
Net managed funds drawn down 370 -

Less:
Non-cash items:
Net managed funds reinvested - 9,602
Donations paid from capital 415 333
(756) (522)

Movements in working capital items:
Increase/(decrease) in creditors 11 -
(Increase)/decrease in debtors 3 -
Increase/(decrease) in income tax payable 88 -
Effect of rounding (1) -
101 -
Net cashflow from operating activities $(655) $(522)

10. Contingent liabilities
    Contingent liabilities at 31 March 2000 consist of donations approved but not disbursed of $4,284,000 (1999 $8,828 million).

11. Loan to Dunedin Community House Trust (Inc.)
    During the year the Trust advanced the Dunedin Community House Trust (Inc.) an interest free loan of $250,000. The term of the loan is for 10 years and quarterly principal payments of $6,250 are to be made from December 22, 2000.

Chairperson’s annual report:
Helping shape the future of Otago
The Community Trust of Otago has had a good year. The funds we hold in trust are safe and we obtained a fair return on those funds. We made a good level of donations that were well balanced and of high quality. But that is nothing more than should be routinely expected, and the work of the Trust does not feel merely routine. The Trust is an adolescent organisation still sensing what maturity could be like – how we can take part in shaping the future of our province, no less. There is a sense of anticipation, even excitement, in that.

Investment performance
The Trust’s income for the year was $11.6 million, which is a 6.3% rate of return. This is not spectacular, but it is satisfactory. It reflects the level of risk we are prepared to take and the performance of world markets, in particular a setting in which the market value of fixed interest securities declined in response to rising interest rates. The rate of return is about what we expect on average. We will have better years than this and worse years than this.

Donations
The number of donations approved during the year was 1082. The total amount was $6.4 million, which is less than for each of the previous two years. The donations amount is not connected with the year’s income level, because we have sufficient reserves that we do not need to make that connection. The lower amount did not result from any tightening up. At this stage we think it reflects only the lumpiness of our donations stream; whether a single $2 million donation falls at the end of one financial year or the beginning of the next will obviously affect comparisons between the years.

Where we are going
The Trust is still in the growing and developing stage. For the first six years of its existence, it received a small dividend from its ownership interest in Trustbank New Zealand and distributed this income in a reactive fashion.

With the exchange of its bank ownership interest for a balanced portfolio of investments – done in two steps – the trust entered the next stage of its development. We appointed a Chief Executive, obtained premises, changed our name. Donations have totalled $27 million over the last three years compared with $10 million over the previous three. And that $37 million over six years matches with $5 million for the first six.

The way I picture it, this physical growth has been accompanied by intellectual and emotional growth. The Trust has established a set of values and, to some degree, a reputation. We have become tentatively proactive, and we have learnt a lot. We discover that we are, uniquely, an organisation that is Otago-wide, has a broad mandate, can be flexible and innovative, and has probably more discretionary spending power than anyone else. This means that we are uniquely placed to make strategic investments in Otago communities. We think we can provide leadership, in a modest style, by opening up possibilities.

These ideas are already taking effect. Two very recent examples are the inaugural Otago Festival of the Arts to be held later this year and current consideration of an Otago-wide economic development initiative. Both of these have not only been