The Canterbury Community Trust

Notes to the financial statements

For the year ended 31 March 2014

3 Significant accounting policies (continued)

(m) New standards adopted and interpretations not yet adopted

The following new interpretations and amendments to standards were adopted for the year ended 31 March 2014, and have been applied in preparing these consolidated financial statements:

IFRS 13 Fair Value Measurement
The nature and effects of the changes are explained below.

IFRS 13 establishes a single framework for measuring fair value and making disclosures about fair value measurements when such measurements are required or permitted by other IFRSs. It unifies the definition of fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. It replaces and expands the disclosure requirements about fair value measurements in other IFRSs, including IFRS 7. As a result, additional disclosures are included in this regard (see Note 11).

Notwithstanding the above, the change had no significant impact on the measurements of assets and liabilities.

The following new interpretations and amendments to current standards are not yet effective for the year ended 31 March 2014, and have not been applied in preparing these consolidated financial statements. The Group expects the following amendments to standards to have an impact on its financial statements in future periods:

NZ IFRS 9 (2009) & (2010) "Financial Instruments" was approved for periods beginning on or after 1 January 2015. This standard replaces the multiple classification and measurement models in IAS 39 Financial Instruments: Recognition and measurement with a single model that has only two categories: amortised cost and fair value. The Group intends to adopt this standard from 1 April 2015. The new standard is not expected to significantly impact the Group but will result in some amended presentation within the Financial Statements.

(n) Change in accounting policies

Other than new standards adopted there have not been any changes in accounting policies during the year.

4 Determination of fair values

A number of the Group’s accounting policies and disclosures require the determination of fair value, for both financial and non-financial assets and liabilities. Fair values have been determined for measurement and/or disclosure purposes based on the following methods. Where applicable, further information about the assumptions made in determining fair values is disclosed in the notes specific to that asset or liability.

(a) Investment property

Valuers having appropriate recognised professional qualifications and recent experience in the location and category of property being valued, value the Group’s investment property portfolio annually. The fair values are based on market values, being the estimated amount for which a property could be exchanged on the date of the valuation between a willing buyer and a willing seller in an arm’s length transaction after proper marketing wherein the parties had each acted knowledgeably, prudently and without compulsion.

In the absence of current prices in an active market, the valuations are prepared by considering the aggregate of the estimated cash flows expected to be received from renting out the property. A yield that reflects the specific risks inherent in the net cash flows then is applied to the net annual cash flows to arrive at the property valuation.

Valuations reflect, where appropriate: the type of tenants actually in occupation or responsible for meeting lease commitments or likely to be in occupation after letting vacant accommodation, and the market’s general perception of their creditworthiness; the allocation of maintenance and insurance responsibilities between the Group and the lessee; and the remaining economic life of the property. When rent reviews or lease renewals are pending with anticipated reversionary increases, it is assumed that all notices and where appropriate counter-notices have been served validly and within the appropriate time.