3978 NEW ZEALAND GAZETTE, No. 158

                        15 SEPTEMBER 2005

Foreign Currencies

All amounts denominated in foreign currencies are converted to New Zealand dollars at balance date and all realised and
unrealised gains and losses are recognised in income and expenditure for the period.

Investments

Investment in managed funds and other investments are stated at market value. Any gains or losses are recognised in income
and expenditure for the period. Investment transactions are recorded by the fund managers on a settlement date basis.

Financial Instruments

All assets and liabilities of the trust are financial instruments and are recognised in the balance sheet. All financial instruments
are recorded at market value which equates to fair value.

The trust uses financial instruments to reduce exposure to fluctuations in foreign currency exchange rates. Forward exchange
contracts are entered into to hedge foreign currency transactions. These are converted to the New Zealand dollar rate at balance
date with all realised and unrealised gains and losses being recognised in the income and expenditure statement.

The quantitative disclosures required by FRS 31 Disclosure of Information about Financial Instruments have been included
throughout the financial statements where material.

Reserves

Transfers to the capital maintenance reserve are based on the annual movement in the consumer price index. Transfers to all
other reserves from the unallocated surplus are made at the discretion of the trustees.

Taxation

Taxation includes both current and deferred tax. Deferred tax is calculated using the comprehensive liability method. Deferred
tax assets are recognised when future taxable income is virtually certain.

Changes in Accounting Policies

There have been no material changes in accounting policies during the period.

            2005        2004
            $000        $000

2. Income

Investments:
Pooled funds 3,565 24,743
Dividends 2,224 1,678
Interest 7,374 7,386
Realised gains 3,580 1,754
Unrealised gains 733 9,379
Realised foreign exchange gains 13,892 33,766
Unrealised foreign exchange gains/(losses) 4,983 (6,054)
Other income received 665 625

            37,016      73,277

3. Investments

Managed by external managers:
Balance as at 1 April 472,120 421,269
Movement in market value and investment income 36,350 72,652
Net withdrawals (19,604) (21,801)

            488,866     472,120

Investments managed by external managers comprise:
Cash, deposits and miscellaneous 29,793 24,256
Bonds 212,279 211,414
Equities 246,794 236,450
Portfolio total 488,866 472,120

Other investments comprise:
Call deposits 317 521
317 521

                    2004
                    $000

4. Taxation

Surplus before taxation 71,774
Net dividend and imputation credit adjustment (1,394)
Investment revaluations for tax purposes (10,059)
Non-deductible expenditure 600
Distribution to tax exempt beneficiaries (10,288)
Prior year tax adjustment (7,312)
Taxable loss brought forward (76,237)
Taxable loss carried forward (32,916)
Taxation charge @ 33% --