✨ Community Trust Financial Report
22 SEPTEMBER 2005
NEW ZEALAND GAZETTE, No. 161
4059
● The measurement base adopted is that of historical cost, except for the revaluation of investments. Reliance is placed on the fact that the trust is a going concern.
● The matching of revenues earned and expenses incurred using accrual accounting.
Particular Accounting Policies
The following are the particular accounting policies which have a material effect on the measurement of results and financial position:
(a) Dividend Income
Dividend income is included in the consolidated statement of financial performance when it is received.
(b) Donations
Donations, special projects and community loans are accounted for when they are approved for payment.
(c) Investments
Investments held as managed funds are shown at market value. Net income including unrealised gains or losses from holding such investments are recorded in the consolidated statement of financial performance.
(d) Trust Capital
Trust capital is made up of:
(i) Capital fund – which records initial capital fund (being the realised value of trust bank shares).
(ii) Inflation reserve – it is intended to increase the inflation reserve each year by applying the consumer price index to the sum of the initial capital fund and opening inflation reserve. This amount to be allocated from trust profit on an annual basis.
(iii) Uncommitted surplus represents the balance of any profit remaining.
(e) Basis of Consolidation
The Community Trust of Mid & South Canterbury Incorporated and its subsidiary the Trust Bank South Canterbury Community Trust Charities Limited have been consolidated using the purchase method of consolidation.
(f) Depreciation
The assets of the trust are stated at cost price less depreciation based on rates as allowed by the Inland Revenue Department.
Changes in Accounting Policies
(a) While the trust has not changed its policy with respect to the capital and reserves of the trust, unfortunately prior year financial results depleted the capital and reserves:
(i) Capital fund – The initial capital fund (being the realised value of trust bank shares) was $32,087,148.
(ii) Inflation reserve – It is intended to increase the inflation reserve each year by applying the consumer price index to the sum of the initial capital fund and opening inflation reserve. The nominal inflation reserve required under this policy at 31 March 2005 is $5,860,728 and it is the trustees’ intention to restore the inflation reserve accordingly.
(b) The trust registered for G.S.T. during the income year. The trust previously recognised income and expenditure on a G.S.T. inclusive basis. In line with generally accepted accounting practice, the trust now prepares its financial statements on a G.S.T. exclusive basis.
(c) The trust purchased a number of fixed assets during the year. These assets are depreciated at rates as determined by the Inland Revenue Department.
(d) There have been no other changes in accounting policy.
- Capital Fund
| 2005 | 2004 | |
|---|---|---|
| $ | $ | |
| Initial capital fund | 32,087,148 | 31,136,967 |
| Transfer from/to general reserves | – | 950,181 |
| Balance at end of the year | 32,087,148 | 32,087,148 |
- Inflation Reserve
| 2005 | 2004 | |
|---|---|---|
| $ | $ | |
| Balance at beginning of the year | 3,242,489 | – |
| Transfer from/to general reserves | 1,942,011 | 3,242,489 |
| Balance at end of year | 5,184,500 | 3,242,489 |
- General Reserves
| 2005 | 2004 | |
|---|---|---|
| $ | $ | |
| Balance at beginning of the year | – | – |
| Add: Surplus for the year | 2,464,413 | 4,511,065 |
| Distribution from Community House Trust | 43,343 | – |
| Add: Donations returned | 5,000 | 23,897 |
| 2,512,756 | 4,534,962 | |
| Deduct: Donations approved | (566,426) | (342,292) |
| Deduct: Tax adjustment | (4,319) | – |
| Transfer to capital | – | (950,181) |
| Transfer to inflation reserve | (1,942,011) | (3,242,489) |
| Balance at end of the year | – | – |
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Online Sources for this page:
VUW Te Waharoa —
NZ Gazette 2005, No 161
Gazette.govt.nz —
NZ Gazette 2005, No 161
✨ LLM interpretation of page content
🏢
Annual Report of the Community Trust of Mid & South Canterbury
(continued from previous page)
🏢 State Enterprises & Insurance23 August 2005
Community Trust, Financial Report, Income, Expenses, Auditors, Accounting Policies, Capital Fund, Inflation Reserve, General Reserves