✨ Financial Statements
4 AUGUST 2014 NEW ZEALAND GAZETTE, No. 87 2453
TSB Community Trust
Notes to the Financial Statements
For the year ended 31 March 2014
13. Financial Instruments (continued)
Credit Risk
Credit risk is the risk that the counterparty to a transaction with the Trust will fail to discharge its obligations, causing the Trust to incur a financial loss. Financial instruments which potentially subject the Trust to credit risk principally consist of cash and cash equivalents, loans and receivables and investments. The Trust manages its exposure to credit risk on an ongoing basis.
The Trust has a significant concentration of credit risk with the TSB Bank Ltd. The Trust’s policy is to keep investments with the TSB Bank Ltd conditional upon the bank’s credit rating remaining at a predetermined level. The Trust manages its credit risk by maintaining a reserve fund in order to maintain the level of grants paid in the event that income decreases.
Maximum exposures to credit risk at balance date are the carrying amounts of financial assets in the statement of financial position.
No financial assets are past due or impaired.
Fair Value
Cash and cash equivalents, receivables, payables and investments are recorded at their carrying values that are a reasonable approximation of their fair values. They are an approximation of fair value as they represent the amounts that would be converted to cash inflows and outflows had they crystallised at balance date.
The estimated fair values of financial instruments that differ from carrying values are as follows:
| Carrying Amount 2014 | Fair Value 2014 | Carrying Amount 2013 | Fair Value 2013 | |
|---|---|---|---|---|
| $ | $ | $ | $ | |
| Held-to-Maturity Investments | 3,000,000 | 3,109,663 | 3,000,000 | 3,032,520 |
The Trust applies a level 2 criteria of the fair value hierarchy in determining the fair value of its financial instruments. The fair value is determined using the inputs for the asset or liability that are not based on observable market data.
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NZ Gazette 2014, No 87
✨ LLM interpretation of page content
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TSB Community Trust Financial Statements
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💰 Finance & Revenue15 July 2014
Financial Statements, Community Trusts, TSB, Accounting Policies, Grants, Contingent Liabilities, NZ IFRS, Credit Risk, Fair Value, Financial Instruments