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The Waikato Community Trust Incorporated
NOTES TO AND FORMING PART OF THE SUMMARISED
FINANCIAL STATEMENTS
for the year ended 31 March 2016
5 Investment Income
2016
2015
NZ$’000
NZ$’000
Net Increase in Investments
36,215
36,836
Net Decrease in Derivative Financial Instruments
(11,515)
(2,653)
Dividends
1,410
1,530
Interest
1,333
1,399
27,443
37,112
6 Trust Funds
2016
2015
Base Capital Value
NZ$’000
NZ$’000
Balance at the Beginning of the Year
278,919
277,572
Transfer from Comprehensive Income
2,289
1,347
Balance at the End of the Year
281,208
278,919
Base capital value is adjusted on a quarterly compounding basis for inflation and regional
population growth.
2016
2015
Investment Fluctuation Reserve
NZ$’000
NZ$’000
Balance at the Beginning of the Year
52,674
29,486
Transfer from Comprehensive Income
9,301
23,188
Balance at the End of the Year
61,975
52,674
The Trustees have adopted an investment strategy with a targeted long term annual rate
of return of 6.4% (2015: 6.4%) of the Trust portfolio value. Recognising that actual returns
are likely to fluctuate from year to year, the Trust retains the variation from the target in an
Investment Fluctuation Reserve, so that in years when investment returns are less than the
target, sufficient funds are available to meet expenditure and make donations. If the Trust
fund falls below the value that needs to be maintained for the benefit of current and future
generations the levels of expenditure and donations are reviewed by the Trust.