28 OCTOBER 2004

NEW ZEALAND GAZETTE, No. 138

3435

R. Goods and Services Tax
The parent is not registered for goods and services tax. The parent financial statements are prepared using G.S.T. inclusive
accounting. The subsidiary of Invest South Limited Group is registered for G.S.T and all assets and liabilities have been stated
exclusive of G.S.T with the exception of receivables and payables which are stated inclusive of G.S.T.

S. Income Tax
The parent provides for income tax on its net income after adjusting for tax accounting differences and any beneficiaries’
income determinations made pursuant to section OBI (226) of the Income Tax Act 1994.
Invest South Limited Group follows the income taxes payable method for accounting for income tax.

T. Statement of Cash Flows
Operating cash flows includes interest and dividends paid or credited to investment funds under management and any upward
or downward revaluation of funds during the period. Cash movements in funds invested are recognised in investing activities.

U. Changes in Accounting Policies
Land and buildings of the trust have been stated at valuation this year. Last year, land was stated at cost and buildings were
stated at cost, depreciated as outlined in the depreciation policy. This had the effect of decreasing the net surplus by $251,228
and decreasing property, plant and equipment by $251,228.
With the exception of the above change in accounting policy, uniform accounting policies have been applied throughout the
trust and group and on a consistent basis with those of the previous period.

Notes to the Financial Statement for the Year Ended 31 March 2004

1. Operating Revenue
Dividends and distributions | 13,138,165 | 13,138,165 | 4,452,442
Interest received | 3,159,511 | 2,730,525 | 2,787,056
Change in value of investments | 8,102,739 | 8,102,739 | (18,631,581)
Share of associates earnings | (735,416) | – | 211,824
Directors’ fees | 3,500 | – | –
Lease income | 24,000 | – | –
Other revenue | 16,661 | – | –
| 23,709,160 | 23,971,429 | (11,180,259)

2. Expenditure
Amortisation of goodwill | 75,978 | – | –
Audit fees | 28,290 | 19,752 | 12,921
Bad debts expense | 377,027 | – | –
Communications | 17,914 | 17,914 | 18,623
Conference costs | 41,990 | 41,990 | 7,462
Depreciation | 101,025 | 70,044 | 74,153
Directors’ fees | 65,000 | – | –
Loss/(gain) on disposal of property, plant and equipment | 413 | 413 | 5,660
Fund manager fees | 570,192 | 570,192 | 445,915
General expenses | 310,426 | 47,640 | 36,735
Impairment of debt | 1,125,599 | – | –
Impairment of equity investment | 7,547 | – | –
Insurance | 13,328 | 13,328 | 12,263
Occupancy costs | 19,038 | 19,038 | 17,089
Office expenses | 21,626 | 20,937 | 20,403
Professional fees | 185,806 | 166,913 | 160,709
Promotion, reporting and compliance expenses | 59,674 | 59,674 | 52,919
Rent | 10,988 | – | –
Salaries and staff costs | 243,231 | 243,231 | 254,862
Trustees’ fees | 196,151 | 196,151 | 167,433
Vehicle expenses | 17,734 | 17,734 | 15,996
| 3,488,977 | 1,504,951 | 1,303,143

3. Auditors’ Remuneration
During the year the following amounts were paid to auditors:

To Ward Wilson, the Group auditors, for audit work | 20,182 | 11,644 | 12,921
To Ward Wilson, the Group auditors, for grants’ audits | 4,927 | 4,927 | –
To other auditors, for grants’ audits | 3,181 | 3,181 | –
| 28,290 | 19,752 | 12,921