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Financial Statements of Waikato River Clean-Up Trust
for the period ended 30 June 2015
Restoring and protecting the health and wellbeing of the Waikato River
48
c) Interest rate risk
2015
Maturity
Effective
Balance
date
interest rate
Term Deposit
1,065,315
15/07/15
4.45%
Term Deposit
1,034,397
17/08/15
4.20%
Term Deposit
1,007,612
21/09/15
4.70%
Term Deposit
1,007,612
21/09/15
4.70%
4,114,936
2014
Maturity
Effective
Balance
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
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 revenue
by $41,149 (2014: $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.
2015
2014
COUNTERPARTIES WITH CREDIT RATINGS
Cash at bank, bonds and term deposits
AA
361,392
342,317
AA-
12,352,015
11,006,357
A+
748,078
717,573
A
759,503
-
A-
-
1,378,908
14,220,988
13,445,155
f) Fair value hierarchy disclosures
The financial instruments of the Trust that are recognised at fair value in the
statement of financial position. Fair values are determined according to level one
of the fair value hierachy, quoted market price, where financial instruments have
quoted prices based on identical instruments in active markets.