8 JULY 2004

NEW ZEALAND GAZETTE, No. 85

2139

The trust has a wholly owned company – Eastern & Central Community Trust Charities Limited – which is registered
under the Companies Act 1993.

The consolidated financial statements have been prepared in accordance with the Financial Reporting Act 1993.

1.2 Measurement Base

The measurement base applied is that of historical cost adjusted for the market valuation of investments.

1.3 Specific Accounting Policies

The following are the particular accounting policies, which have a material effect on the measurement of results and
financial position.

1.3.1 Basis of Consolidation

The consolidated financial statements include the trust and its wholly owned company accounted for using the
purchase method. All significant inter-entity transactions are eliminated on consolidation. The entities have a
common balance date of 31 March.

1.3.2 Investment Income is accounted for on an accruals basis recognising both realised and unrealised gains or
losses in value.

1.3.3 Foreign Currency balances are converted to NZD at the year end rate of exchange unless covered by a
forward exchange contract. Where such contracts are in place, the contracted rate is adopted. Transactions completed
during the year are converted at the rate applying at the approximate date of the transaction. Foreign exchange gains
and losses are included within the statement of financial performance.

1.3.4 Investments are recorded at market value at year-end.

1.3.5 Cash comprises cash at bank, call deposits and short-term deposits but does not include cash held by fund
managers. Cash flows from operations include withdrawals of income from managed funds.

1.3.6 Donations are recognised as a liability of the trust when they are approved by trustees and notified to
applicants notwithstanding that the applicants may still have to fulfil some conditions.

1.3.7 Fixed Assets

Fixed assets are recorded at cost less accumulated depreciation.

1.3.8 Depreciation is provided on a straight line basis on all tangible fixed assets at rates calculated to allocate the
assets’ cost less estimated residual value over their estimated useful lives.

The depreciation periods are:

Computer equipment three years
Fixtures and fittings nine years
Furniture ten years
Office equipment five years

1.3.9 Income tax expense recognises the obligation payable to the Inland Revenue Department.

1.3.10 G.S.T. inclusive accounting has been adopted, as the trust is not registered for G.S.T.

1.4 Changes in Accounting Policies

There have been no changes in accounting policies. All policies have been consistently applied.

2. Income From Investments

3. Taxation

During the year, the trustees paid $193,770 to the Inland Revenue Department on behalf of the beneficiaries. The trustees had
made provision for the likely tax payable in 2002. No tax is payable this year as all applicants have presented an Inland
Revenue letter of exemption from income tax.

4. Trust Capital

The initial trust capital was set at $90,000,000 in 1997. The trust capital has been increased over time as a surrogate for
inflation and population growth within the region administered by the trust. The trustees periodically review the capital.