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Financial Statements of Waikato River Clean-Up Trust
for the period ended 30 June 2014
Restoring and protecting the health and wellbeing of the Waikato River
46
c) Interest rate risk
2014
Balance
Maturity
Effective
date
interest rate
Term Deposit
1,000,000
20/07/14
4.05%
Term Deposit
1,031,488
20/08/14
4.07%
Term Deposit
1,030,973
20/09/14
4.08%
Term Deposit
1,018,842
20/10/14
4.11%
Term Deposit
1,000,000
18/11/14
4.65%
Term Deposit
1,000,000
20/01/15
4.50%
Term Deposit
1,000,000
20/02/15
4.50%
Term Deposit
1,061,170
20/03/15
4.50%
8,142,473
2013
Balance
Maturity
Effective
date
interest rate
Term Deposit
1,000,000
20/10/13
4.20%
Term Deposit
1,000,000
26/11/13
4.21%
Term Deposit
2,000,000
26/08/13
4.19%
Term Deposit
1,000,000
20/02/14
4.01%
Term Deposit
1,000,000
20/12/13
3.93%
Term Deposit
2,000,000
26/07/13
4.15%
Term Deposit
2,000,000
05/01/14
4.25%
Term Deposit
1,000,000
20/09/13
4.10%
Term Deposit
1,000,000
26/11/13
4.25%
Term Deposit
445,104
15/08/13
2.66%
12,445,104
d) Sensitivity analysis
In managing interest rate risk the trust aims to reduce the impact of short-term
fluctuations on the trust’s earnings by investing in short term deposits. Over the
longer-term, however, permanent changes in interest rates will have an impact on
profit. A decrease in interest rates of one percent would reduce interest income
by $81,425
e) Credit quality of financial assets
The credit quality of financial assets that are neither past due nor impaired can
be assessed by reference to Standard and Poor’s credit ratings (if available) or to
historical information about counterparty default rates.
2014
2013
COUNTERPARTIES WITH CREDIT RATINGS
Cash at bank, bonds and term deposits
AA
342,317
344,849
AA-
11,006,357
14,071,661
A+
717,573
624,821
A-
1,378,908
244,696
13,445,155
15,286,027