17 AUGUST 2011 NEW ZEALAND GAZETTE, No. 126 3481

Accounting Policies

The measurement basis adopted is that of historical cost except for financial assets and liabilities which are recorded at fair value. Statement of Compliance The consolidated financial statements have been prepared in accordance with New Zealand generally accepted accounting practice (NZGAAP) as represented by the New Zealand equivalents to the international financial reporting standards (NZIFRS). For this purpose the incorporation has designated itself a public benefit entity. The financial statements comply with the international financial reporting standards issued by the International Accounting Standards Board.

Reliance is placed on the fact that the Foundation is a going concern. The Financial Statements have been prepared in accordance with the requirements of the Financial Reporting Act 1993.

The Foundation’s functional currency is New Zealand Dollars.

Basis of Preparation

The preparation of financial statements in conformity with NZ IFRS requires management to make judgements, estimates and assumptions that affect the application of policies and the reported amounts of assets, liabilities, income and expense. The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised, if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.

Judgements are made by management in the application of NZ IFRS that have a significant effect on the financial statements and estimates with a significant risk of material adjustment in the next year are discussed in Note 9: Financial Assets and Liabilities.

Consolidated financial statements

The Consolidated Financial Statements include the Foundation’s wholly owned subsidiary, Whanganui Charitable Foundation Ltd.

The purchase method is used to prepare the consolidated financial statements, which involves adding together like items of assets, liabilities, equity, income and expenses on a line by line basis. All balances and transactions between the Whanganui Community Foundation and Whanganui Charitable Foundation are eliminated on consolidation.

Cash Flow Statement

Cash comprises cash at bank and call deposits but does not include cash or deposits held by the Fund Managers. Therefore the Cash Flow Statement does not reflect the cash flows within the Fund Managers’ portfolios.

Revenue - Dividends, Pooled Funds and Interest

Income from Pooled Funds is recognised on declaration date. Interest is recognised on an accrual basis.

Grants

Approval of a grant by Trustees results in the recognition of that grant within the Foundation’s financial statements whether or not payment has been made. Committed grants are payable on the satisfaction of any conditions placed on the recipients. Grants no longer required or not fully utilised by grant recipients are shown separately in the Income Statement.

Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, bank balances, deposits held at call with banks, other short term highly liquid investments with original maturities of twelve months or less, which are held to meet short term cash requirements.

Property, Plant & Equipment

Property, Plant & Equipment are valued at cost, less accumulated depreciation and accumulated impairment losses except for Freehold land and buildings which are subsequently revalued on a cyclical basis, with no individual Land and Building being recognised at a valuation undertaken more than 3 years previously.

Valuations are at net current value, as determined by an independent valuer. Any revaluation surplus arising on the revaluation of an asset is transferred directly to the asset revaluation reserve. A revaluation deficit in excess of the asset revaluation reserve balance for the asset is recognised in the income statement in the period it arises. Revaluation surpluses which reverse previous revaluation deficits recorded in the income statement are recognised as revenue in the income statement.

Property, Plant & Equipment are reviewed annually to determine any impairment losses. Impairment losses are recognised in the Income Statement.

When an item of property, plant and equipment is disposed of, any gain or loss is recognised in the income statement and is calculated as the difference between the sale price and the carrying value of the item.

Depreciation, Amortisation and Impairment Losses

Depreciation is provided over the useful life of the assets. Buildings have not been depreciated as the impairment assessment is that there has been no impairment in value. Other Plant and Equipment are depreciated on a diminishing value basis. The rates used are those approved by Trustees as follows:

There were no impairment allowances at year end.

Foreign Currency Transactions and Balances

Foreign Currency transactions are recorded in New Zealand dollars at the spot exchange rate applying at the date of the transaction. All amounts denominated in foreign currencies at balance date are translated to New Zealand dollars at the balance date closing exchange rate. All realised and unrealised gains and losses on foreign currency transactions are recognised in the Income Statement.