New Zealand Gazette – 2014 – No. 105

Page 2951

✨ Financial Statements Notes

ASB COMMUNITY TRUST

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH 2014

Implementation of hedging contracts for the investment portfolio follows the month end valuation of the portfolio. Any movements in markets during this period may result in the portfolio being under or over hedged. These are not considered material, and will have minimal impact on the fair value of or future cash flows from the Group’s financial assets.

At balance date the Group’s exposure to currency risk was as follows:

	Group		Trust
	2014	2013	2014	2013
	$000	$000	$000	$000
Financial assets with currency exposure	889,835	866,227	889,835	866,227
Hedged currency exposure as at 31 March	(553,288)	(519,217)	(553,288)	(519,217)
Unhedged currency exposure at 31 March	336,547	347,010	336,547	347,010

| | | | | |
| North America | 213,645 | 211,790 | 213,645 | 211,790 |
| Europe | 52,743 | 60,875 | 52,743 | 60,875 |
| Oceania | 37,107 | 35,322 | 37,107 | 35,322 |
| Asia | 33,052 | 39,023 | 33,052 | 39,023 |
| Unhedged currency exposure at 31 March | 336,547 | 347,010 | 336,547 | 347,010 |

Pricing Risk

Pricing Risk is the risk that the fair value of financial assets will increase or decrease as a result of changes in market prices, whether these changes are caused by factors specific to individual stocks or factors affecting all financial assets in the market. Pricing risks arise from the Group’s Investment Portfolio.

The Group's financial assets are priced at fair value by the Group’s Custodian. Investments held in pooled funds are valued at either the lower of net asset value (NAV) or redemption price. Investments held in segregated accounts are valued at closing market prices. The effect on the Group’s Statement of Comprehensive Income and Statement of Financial Position at 31 March 2014, due to a possible change in market risk (including interest rate risk, currency risk and pricing risk) is represented in the following table:

	Sensitivity Range	Sensitivity Impact
	(-1 to +1 standard	(from the expected annual
	deviation from the	return)
	expected annual return)
		$000
Growth Assets	-6.2% to +27.0%	29,908 to +130,243
Diversified Assets	-0.3% to +16.1%	-713 to +38,280
Inflation Proofing Assets	-4.3% to +20.7%	-4,227 to +20,349
Deflation Proofing Assets	+0.7% to +10.1%	+2,272 to -32,788
Total Portfolio	-0.7% to +17.3%	-8,002 to +197,754