✨ Financial Statements
4 AUGUST 2014
NEW ZEALAND GAZETTE, No. 86
2423
EASTERN AND CENTRAL COMMUNITY TRUST INC
Information regarding the fair value of assets and liabilities exposed to risk is regularly reported to the Trust’s management, the Trust’s Executive sub-Committee and ultimately the Board of Trustees. The Investment Portfolio is rebalanced, as necessary, to ensure that the asset classes remain within the strategic asset allocation policies as set out in the Trust’s Statement of Investment Policies and Objectives (SIPO). The Trustees regularly review the Trust’s SIPO.
The SIPO sets out the Trust’s primary investment objectives. These can be summarised as to:
- ensure that the investment fund is invested prudently;
- provide inter-generational equity with regard to distribution levels over time;
- ensure money is available for distribution, as required, to meet the needs and distribution policies of the Trust;
- to maintain the value of the investment fund’s capital base in real terms and to grow such capital value at a level equal to the population base growth of the region. Real in this context relates to changes in the Consumer Price Index (CPI);
- maximise the funds available for donations.
The Trust manages its Investment Portfolio in terms of its SIPO. The SIPO is monitored on a regular basis by the Board of Trustees and amended as necessary. The Portfolio’s strategic asset allocation is reviewed annually. The strategic asset allocation was last reviewed in November 2013. MCA NZ Limited assists both management and the Trustees with investment advice and the portfolio management.
d) Portfolio Characteristics and Changes
The Trust has its investments in five different portfolios and the performance of each asset class, with the exception of private equity, is measured against an appropriate index.
Following the November 2012 SIPO review, the Trustees implemented the agreed changes to the investment policies and how the capital was invested. The new policies place greater emphasis on having appropriate cash available for distribution and the generation of a growing stream of income. The current policies move from a portfolio percentage basis of allocation to a dollar amount allocation. This change allocates the Trust’s capital to $10m to cash assets for liquidity management, $50m to bonds to provide a base level of income and maturity profile cash flow, private equity (up to $20m) with the balance invested in listed shares to provide growth opportunities. Therefore during the year, the existing off shore bonds, shares and property portfolios were realised and allocated to the five portfolios detailed below.
2014
| Portfolio | Investment Manager | Investments | Allocation |
|---|---|---|---|
| Target | |||
| $m | |||
| Listed Shares | Forsyth Barr | NZ and international shares & listed property | 34.5 |
| Elevation Capital | NZ and international shares & listed property | 34.5 | |
| - offshore component 50% hedged to NZ dollars | 69.0 | ||
| Private Equity | Pioneer Capital | NZ private equity funds | 20.0 |
| Partners | |||
| NZ Bonds | FBEC | NZ bonds | 40.0 |
| Offshore Bonds | PIMCO | Pooled investment fund (international bonds) | 10.0 |
| - 100% hedged to NZ dollars | |||
| Held for Trading | 139.0 | ||
| Cash | Self managed | Bank deposits | 10.0 |
| TOTAL | 149.0 |
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NZ Gazette 2014, No 86
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Financial Statements of Eastern and Central Community Trust Incorporated
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💰 Finance & RevenueFinancial Statements, Investment Portfolio, Strategic Asset Allocation, Risk Management