✨ Financial Statements and Risk Analysis
14 AUGUST 2008 NEW ZEALAND GAZETTE, No. 127 3331
Offshore investments are denominated into the following foreign currency groupings:
| 2008 | 2007 | |
|---|---|---|
| $ | $ | |
| USA/Canada | 13,385,523 | 16,298,653 |
| UK/Europe | 21,838,583 | 25,010,255 |
| Japan/Asia | 16,225,079 | 19,451,622 |
| Australia | 11,885,208 | 10,931,312 |
| Total | 63,334,393 | 71,691,842 |
The Australian Listed Property Index Trust is reported in AUD. The remaining offshore equity investments are:
- Managed by State Street Global Advisors (Boston, USA).
- Invested in 24 individual country common trust funds.
- Reported in the fund’s base currency of USD.
Exposure to currency risk:
| AUD | USD | AUD | USD | |
|---|---|---|---|---|
| 31 March 2008 | 31 March 2007 | |||
| $ | $ | $ | $ | |
| Equities | 929,633 | 62,404,760 | Nil | 71,691,842 |
The following NZD exchange rates applied during the year:
| Average of Monthly Mid-Rates | |
|---|---|
| 2007–08 | |
| AUD | 0.8750 |
| USD | 0.7598 |
Sensitivity Analysis for Currency
A 10% movement of the NZD against the following currencies at 31 March would have increased (decreased) profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular interest rates, remain constant. This analysis is performed on the same basis for 2007.
Effect in NZD:
| Profit or Loss | ||
|---|---|---|
| 31 March 2008 | 31 March 2007 | |
| $ | $ | |
| 10% fall in NZD/AUD | 103,293 | Nil |
| 10% rise in NZD/AUD | (84,512) | Nil |
| 10% fall in NZD/USD | 6,933,862 | 7,965,760 |
| 10% rise in NZD/USD | (5,673,160) | (6,517,440) |
(c) Interest Rate Risk
The trust’s investments in fixed rate securities are subject to interest rate risk. The trust’s statement of investment policies and objectives requires a fixed rate security to have a minimum of a BBB rating or equivalent grade. The maximum exposure to each fixed security is controlled by the credit rating so that the higher the credit rating, the higher the allowable exposure. The fixed rate securities mandate ensures that a high percentage of the securities are rated A or higher. Short term deposits are invested for periods up to 365 days taking into account current interest rates.
At the reporting date the interest rate profile of the trust’s interest bearing financial instruments was:
| Carrying Amount | |
|---|---|
| 2008 | |
| $ | |
| Fixed Rate Instruments | 55,803,015 |
| Variable Rate Instruments | 7,278,079 |
| Total | 63,083,094 |
Sensitivity Analysis for Fixed Rate Instruments
A change of 100 basis points (1%) in interest rates would have increased or decreased profit or loss by the amounts shown. The analysis is performed on the same basis for 2007.
| Fixed Rate Instruments | Cash Flow Sensitivity |
|---|---|
| 31 March 2008 | |
| $ | |
| 100 basis points increase | 558,030 |
| 100 basis points decrease | (558,030) |
Sensitivity Analysis for Variable Rate Instruments
A change of 100 basis points (1%) in interest rates at the reporting date would have increased (decreased) profit or loss by the amounts shown below. The analysis is performed on the same basis for 2007.
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NZ Gazette 2008, No 127
✨ LLM interpretation of page content
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Eastern & Central Community Trust Incorporated Financial Statements
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💰 Finance & Revenue23 May 2008
Financial statements, Accounting policies, Foreign currency, Financial instruments, Donations, Property, Depreciation, Impairment, Employee benefits, GST, Income tax, Intangible assets, Leases, Net income from investments