Te pŪrongo 2012
Notes to the financial statements (continued)
2012
$000
2012
$000
+100bps
Other
Equity
-100bps
Other
Equity
+100bps
Other
Equity
Surplus
-100bps
Other
Equity
+100bps
Other
Equity
2011
$000
-100bps
Other
Equity
+100bps
Other
Equity
Note
Note
2011
$000
Surplus
Surplus
Surplus
-100bps
Other
Equity
Surplus
Surplus
Surplus
Surplus
15 Financial instruments (continued)
(d)
Sensitivity analysis
The tables below illustrate the potential profit and loss and equity (excluding retained earnings) impact for
reasonably possible market movements with all variables held constant based on the financial instrument exposures
of Te Wānanga o Aotearoa at balance sheet date.
Group
Interest rate risk
Financial assets
Cash and cash equivalents 1 (53)
-
53
-
(102)
-
102
-
Total sensitivity to interest rate risk (53)
-
53
-
(102)
-
102
-
Parent
Interest rate risk
Financial assets
Cash and cash equivalents 1 (47)
-
47
-
(92)
-
92
-
Total sensitivity to interest rate risk (47)
-
47
-
(92)
-
92
-
1. Explanation of interest rate risk sensitivity
The interest rate sensitivity is based on a reasonable possible movement in interest rates, with all other variables held constant,
measured as a basis points (bps) movement. For example a decrease in 50 bps is equivalent to a decrease in interest rates of 0.5%.
(e)
Capital Management
The capital of Te Wānanga o Aotearoa is its equity, which comprises retained earnings and property revaluation.
Equity is represented by net assets.
Te Wānanga o Aotearoa is subject to the financial management and accountability provisions of the Education Act
1989, which includes restrictions in relation to: disposing of assets or interests in assets, ability to mortgage or
otherwise charge assets or interests in assets, granting leases of land or buildings or parts of buildings
and borrowings.
Te Wānanga o Aotearoa manages its revenues, expenses, assets, liabilities, investments, and general financial
dealings prudently and in a manner that promotes the current and future interests of the community. Te Wānanga o
Aotearoa’s equity is largely managed as a by-product of managing revenues, expenses, assets, liabilities and general
financial dealings.
The objective of managing Te Wānanga o Aoteaora’s equity is to ensure that it effectively and efficiently achieves the
goals and objectives for which it has been established, while remaining a going concern.
106
