Post on 14-Apr-2020
Te Runanga o Toa Rangatira Incorporated Group
Financial Statements and Annual Report
For the Year Ended 30th June 2018
Consolidated
te
Table of Contents
Independent Auditor's Report 3
Consolidated Statement of Comprehensive Revenue and Expense 5
Consolidated Statement of Financial Position 7
Consolidated Statement of Cash Flows 9
Consolidated Statement of Changes in Equity 10
Notes to the Financial Statements 12
Te Runanga O Toa Rangatira Incorporated Group
Financial Statements and Annual Report
For the Year Ended 30th June 2018
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
2
INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF TE RUNANGA O TOA RANGATIRA INCORPORATED GROUP
Opinion We have audited the consolidated financial statements of Te Runanga o Toa Rangatira Incorporated (“the Parent”) and its subsidiaries (together, “the Group”), which comprise the consolidated statement of financial position as at 30 June 2018, and the consolidated statement of comprehensive revenue and expense, consolidated statement of changes in net assets and consolidated cash flow statement for the year then ended, and notes to the consolidated financial statements, including a summary of significant accounting policies. In our opinion, the accompanying consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Group as at 30 June 2018, and its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with Public Benefit Entity Standards Reduced Disclosure Regime (“PBE Standards RDR”) issued by the New Zealand Accounting Standards Board. Basis for Opinion We conducted our audit in accordance with International Standards on Auditing (New Zealand) (“ISAs (NZ)”). Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements section of our report. We are independent of the Group in accordance with Professional and Ethical Standard 1 (Revised) Code of Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Other than in our capacity as auditor, and our involvement in the assistance with formatting the financial statements, we have no relationship with, or interests in, the Parent or any of its subsidiaries. Other Information The Board is responsible for the other information. The other information comprises the annual report, but does not include the consolidated financial statements and our auditor’s report thereon. The other information is expected to be made available to us after the date of this auditor’s report. Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of audit opinion or assurance conclusion thereon. In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work we have performed on the other information obtained prior to the date of this auditor’s report, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. Board’s Responsibilities for the Consolidated Financial Statements The Board is responsible on behalf of the Group for the preparation and fair presentation of the consolidated financial statements in accordance with PBE Standards RDR, and for such internal control as the Board determines is necessary to enable the preparation of consolidated financial statements that are free from material misstatement, whether due to fraud or error. In preparing the consolidated financial statements, the Board is responsible on behalf of the Group for assessing the Group’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Consolidated Financial Statements Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (NZ) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the decisions of users taken on the basis of these consolidated financial statements. As part of an audit in accordance with ISAs (NZ), we exercise professional judgement and maintain professional scepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
• Conclude on the appropriateness of the use of the going concern basis of accounting by the Board and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Group to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with the Board regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Who we Report to This report is made solely to the Parent’s members, as a body. Our audit work has been undertaken so that we might state those matters which we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Parent and the Parent’s members, as a body, for our audit work, for this report or for the opinions we have formed. BDO Wellington Audit Limited Wellington New Zealand 31 October 2018
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Comprehensive Revenue and ExpenseFor the Year Ended 30th June 2018
NOTE 2018 2017
$ $
Health, medical and other social services income 5 10,216,900 8,589,700
Direct service delivery costs (1,336,907) (1,242,781)
Surplus from delivery of social services 8,879,994 7,346,919
Trading income 5 2,469,811 12,595,792
Direct trading expenses (162,153) (9,714,895)
Surplus from trading activities 2,307,657 2,880,897
Other income
Gain on revaluation of investment land 13 3,325,980 2,783,295
Writeback of depreciation on revalution - 194,312
Gain on sale of fixed assets 5 782 173
Gain on sale of NZ Forestry Units 5 426,000
Other income 5 3,891,689 3,532,601
Fisheries and historical redress 5 4,854,122 -
Total revenue from operations 23,686,225 16,738,197
Less operating expenses
Administration expense (220,532) (518,082)
Depreciation, amortisation and impairment expense 12 (678,733) (585,212)
Education, sports and marae distributions (184,541) (117,748)
Lease operating costs (110,256) (65,260)
Motor vehicle expense (236,494) (254,575)
Other expenses (948,530) (599,608)
Personnel expenses 6 (8,535,045) (7,797,270)
Property expenses (1,209,817) (1,230,881)
Loss on sale of property, plant and equipment - (206,462)
Share of loss in joint venture (49,257) (31,610)
Total expenses (12,173,204) (11,406,708)
Surplus before net interest income 11,513,021 5,331,489
Gain/(loss) on revaluation of financial portfolio 1,870,991 1,347,940
Interest income 5 2,081,951 2,388,710
Less Interest expense (2,720) (852)
Net interest income 3,950,222 3,735,798
Surplus for the year before tax 15,463,242 9,067,286
Tax expense 11 (531,301) (974,963)
Surplus for the year 14,931,941 8,092,323
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
5 TE
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Comprehensive Revenue and ExpenseFor the Year Ended 30th June 2018
NOTE 2018 2017
$ $
Other comprehensive revenue and expense
Gain/(Loss) on revalution of property, plant and equipment 12 - 1,228,042
Gain/(Loss) on revaluation of intangible assets 20 1,120,619 294,489
Total other comprehensive revenue and expense 1,120,619 1,522,531
Total comprehensive revenue and expense for the year 16,052,560 9,614,854
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
6 TE
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Financial PositionAs at 30th June 2018
NOTE 2018 2017
$ $
Assets
Current Assets
Cash and cash equivalents 7 10,186,064 11,067,320
Short term investments 8 68,497,394 52,686,209
Accounts and other receivables 9 3,963,706 2,715,266
Prepayments and other assets 10 42,118 29,280
Income tax receivable 11 315,448 -
Total Current Assets 83,004,730 66,498,075
Non Current Assets
Long term deposits 8 1,422,886 6,943,688
Managed funds 8 22,953,237 21,322,329
Property plant and equipment 12 17,661,547 17,461,054
Investment property 13 51,796,004 46,067,098
Intangible assets 20 12,392,421 15,985,794
Share investments 14 2,366,678 2,366,678
Investment in joint venture 21 10,135,493 8,570,752
Total Non Current Assets 118,728,266 118,717,393
Total Assets 201,732,996 185,215,468
Liabilities
Current Liabilities
Trade and other payables 15 773,164 910,912
Deferred Income 16 - 4,855
Rent received in advance 17 707,390 254,812
Employee benefit liability 18 698,554 528,477
Income tax 11 - 15,085
Total Current Liabilities 2,179,108 1,714,141
Total liabilities 2,179,108 1,714,141
Net Assets 199,553,888 183,501,327
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
7
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Financial PositionAs at 30th June 2018
NOTE 2018 2017
$ $
Equity
Treaty & Fisheries settlement reserves 24 136,764,978 131,910,855
Other special purpose reserves 24 1,186,078 1,186,078
Revaluation reserve - Intangibles 24 7,799,282 10,593,663
Revaluation reserve - Land & Buildings 24 5,832,408 5,832,408
Accumulated revenue and expense 47,971,142 33,978,323
Total Equity 199,553,888 183,501,327
Board Member__________________________________
Board Member__________________________________
Date:
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
8
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Cash FlowsFor the Year ended 30th June 2018
NOTE 2018 2017
$ $
Cashflow from operating activities
Proceeds have come from:
Contract income 9,616,489 8,641,453
Trading income 2,477,897 19,452,372
Rental income 3,312,817 2,670,633
Settlement proceeds 3,354,122 -
Other sundry proceeds 1,031,450 814,666
GST refunds/(payments) 171,399 277,388
Income tax paid (861,834) (1,249,198)
Payments made to suppliers and others (4,591,406) (20,521,112)
Payments made to employees (8,364,968) (7,787,021)
Net cash inflow/(outflow) from operating activities 6,145,966 2,299,181
Cashflows from investing activities
Proceeds from interest earnings 2,786,994 3,343,527
Proceeds (to)/from term investment activities (10,056,123) (8,828,437)
Proceeds from sale of property plant and equipment 61,779 510,000
Purchase of property plant and equipment (906,230) (3,250,858)
Purchase of website - (10,000)
Purchase of Waitangirua Medical Centre (480,000) -
Sale/(Purchase) of NZ Forestry Emission Units 5,586,000 1,785,000
Purchase of investment property (2,402,923) (728,227)
Purchase of other Investments (1,613,998) (8,977,362)
Net cash inflow/(outflow) for investing activity (7,024,502) (16,156,357)
Cash flows from financing activities
Interest payments (2,720) (852)
Net cash inflow/(outflow) from financing activities (2,720) (852)
Net cash inflow/(outflow) from all activity (881,256) (13,858,028)
Cash and cash equivalents at the beginning of the year 7 11,067,320 24,925,348
Cash and cash equivalents at the end of the year 7 10,186,064 11,067,320
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
9te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Changes in EquityFor the Year ended 30th June 2017
Group 2017 Note
Treaty &
Fishe
ries
settle
me
nt re
serve
s
Oth
er sp
ecial p
urp
ose
rese
rves
Re
valuatio
n re
serve
-
Intan
gible
s
Re
valuatio
n re
serve
-
Land
& B
uild
ings
Accu
mu
lated
reve
nu
e
and
exp
en
se Total
Balance as at 1 June 2016 24 131,910,855 1,186,078 11,669,174 4,774,547 24,345,819 173,886,474
Surplus for the year - - - - 8,092,323 8,092,323
Other comprehensive revenue and expense - - 294,489 1,228,042 - 1,522,531
- - 294,489 1,228,042 8,092,323 9,614,854
Transactions with owners of the controlling entity
in their capacity as owners
Contributions - - - - - -
Distributions - - - - - -
Transfers - special purpose reserve - - 170,181- 170,181 -
Transfers - disposal of revalued land and buildings - - 1,370,000- - 1,370,000 -
Total transactions with owners of the entity - - 1,370,000- 170,181- 1,540,181 -
Balance at 30 June 2017 24 131,910,855 1,186,078 10,593,663 5,832,408 33,978,323 183,501,328
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
10
Te Runanga O Toa Rangatira Incorporated Group
Consolidated Statement of Changes in EquityFor the Year ended 30th June 2018
Group 2018 Note
Treaty &
Fishe
ries
settle
me
nt re
serve
s
Oth
er sp
ecial p
urp
ose
rese
rves
Re
valuatio
n re
serve
-
Intan
gible
s
Re
valuatio
n re
serve
-
Land
& B
uild
ings
Accu
mu
lated
reve
nu
e
and
exp
en
se Total
Balance as at 1 July 2017 24 131,910,855 1,186,078 10,593,663 5,832,408 33,978,323 183,501,328
Surplus for the year - - - - 14,931,941 14,931,941
Other comprehensive revenue and expense - - 1,120,619 - - 1,120,619
- - 1,120,619 - 14,931,941 16,052,560
Transactions with owners of the controlling entity
in their capacity as owners
Contributions - - - - - -
Distributions - - - - - -
Transfers - historical and fisheries redress 4,854,122 - - - (4,854,122) -
Transfers - disposal of revalued intangibles - - (3,915,000) - 3,915,000 -
Total transactions with owners of the entity 4,854,122 - (3,915,000) - (939,122) -
Balance at 30 June 2018 24 136,764,978 1,186,078 7,799,282 5,832,408 47,971,142 199,553,888
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
11
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
1. Reporting Entity
2. Basis of Preparation
The Group qualifies as a Tier 2 reporting entity as for the past two reporting periods it has had between $2m
and $30m operating expenditure. All entities which form part of the consolidated group have policies
consistent with Tier 2.
Land and buildings under the revaluation model
Investment property
Quota holdings
NZ Forestry Emission Units (NZU’s)
These financial statements are for the year ended 30 June 2018 and were authorised for issue by The Board on
31st October 2018.
b. Measurement Basis
Initial measurement of assets received from non-exchange transaction.
The consolidated financial statements have been prepared on an historical cost basis, except for the following
material items in the Statement of Financial Position, which are measured at fair value;
Te Runanga o Toa Rangatira Incorporated is a public benefit entity for the purposes of financial reporting in
accordance with the Financial Reporting Act (2013).
Te Runanga o Toa Rangatira is a registered charity under the Charities Act 2005, registration number CC42382.
The primary activity of the organisation is the provision of assistance by way of relief of poverty, promotion of
health and wellbeing and advancement of education for all members of Ngati Toa Rangatira and the
community.
Te Runanga o Toa Rangatira is also the Mandated Iwi Organisation and Trustee over the Ngati Toa Rangatira
settlement assets.
The principal place of business is 26 Ngati Toa Street, Takapuwahia, Porirua.
These consolidated financial statements for the year ended 30 June 2018 comprise the controlling entity and
its controlled entities (together referred to as the ‘Group’ and individually as ‘Group Entities’).
a. Statement of Compliance
The consolidated financial statements have been prepared in accordance with New Zealand Generally
Accepted Accounting Practice ("NZ GAAP").
They comply with Public Benefit Entity reduced Disclosure Regime (‘PBE Standards RDR”) and other applicable
Financial Reporting Standards, as appropriate for Tier 2 not-for-profit public benefit entities, for which all
reduced disclosure regime exemptions, have been adopted.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
12te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
3. Significant Accounting Policies
The significant accounting policies set out below have been consistently applied to all periods presented in
these financial statements and have been consistently applied across the Group.
d. Judgements, Assumptions and Estimates
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from those judgements, estimates and assumptions.
Estimates and underlying judgements are reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimates are revised and any future periods affected.
The accounting policies set out in the notes to the financial statements have been applied in preparing
financial statements for the year ended 30 June 2018 and comparative information presented for the year
ended 30 June 2017.
e. Changes in Accounting Policies
There have been no changes in accounting policies for the Group.
(ii). Assumptions and estimation uncertainties
Assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment in
the year ended 30 June 2018 include the following:
Useful life, recoverable amount, depreciation /amortisation methods and rates used.
c. Functional Presentation Currency
The Financial Statements are presented in New Zealand dollars ($), which is the controlling entity’s functional
and Group presentation currency. All numbers presented have been rounded to the nearest dollar. There has
been no change to the functional currency of the Group during the year.
Classification of lease arrangements
Reclassification of property plant and equipment to (from) investment property
7. Cash and cash equivalents
8. Short term investments, long term deposits and managed funds
9. Accounts and other receivables
10. Prepayments
11. Income tax
Revenue recognitions – non-exchange revenue (conditional vs restrictive)
The significant accounting policies used in the preparation of these financial statements are summarised below
and are contained within the following Notes to the Financial Statements:
4. Basis of Consolidation
5. Revenue
6. Personnel costs
The Board have considered that for the information to be useful to the readers that the Note for any item on
the face of the financial Statements, will be shown below the policy that has been adopted where appropriate.
Intangible assets having finite or indefinite useful lives
Whether there is control or not over a Group entity
(i). Judgements
Judgements made in applying accounting policies that have had the most significant effects on the amounts
recognised in the consolidated financial statements include the following:
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
13te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
21. Investment in Joint Venture
4. Basis of consolidation
Subsidiary Name Country of
Incorporation 2018 2017 2018 2017
Toa Rangatira Trust New Zealand 10 10 10 10
Ika Toa Limited New Zealand 20,100 20,100 20,100 20,100
Ngati Toa Limited New Zealand 100 100 100 100
Kapiti Tours Limited New Zealand 100 100 100 100
Ora Toa PHO Limited New Zealand 1 1 1 1
Toa Rangatira Group Holdings Limited New Zealand Trustee group 1 1 1 1
Toa Rangatira Investment Properties Limited New Zealand Trustee group - - - -
Toa Rangatira Developments Limited New Zealand Trustee group - - - -
Whenua Toa Trust New Zealand Trustee group - - - -
Total 20,312 20,312 20,312 20,312
12. Property, plant and equipment
13. Investment property
14. Share investments
15. Trade and other payables
16. Deferred income
The Group financial reports include the following controlled entities and the relationship to the controlling
entity;
Subsequent changes in a controlled entity that do not result in a loss of control are accounted for as
transactions with controllers of a controlling entity in their capacity as controller within net assets/equity.
a. Controlled Entities
Controlled entities are entities controlled by the Group, being where the Group has power to govern the
financial and operating policies of another entity so as to benefit from their entities’ activities. The financial
statements of the Group’s controlled entities are included in the consolidated financial statements from the
date that control commences to the date control ceases.
17. Rent received in advance
18. Employment entitlements
19. Financial instruments
20. Intangible assets
22. Impairment of non-financial assets
26. Events subsequent to balance date
25. Contingencies and commitments
24. Reserves
23. Leases (as lessor and as lessee)
27. Related parties
Intra-group balances and transactions, and any unrealised income and expenses arising from intra-group
transactions, are eliminated in preparing the consolidated financial statements.
Unrealised losses are eliminated in the same way as unrealised gains, but only to the extent that there is no
evidence of impairment.
Share capital (number of shares) Investment at cost
b. Transactions Eliminated on Consolidation
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
14te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
5. Revenue
(i). Sale of goods
Revenue from the sale of goods in the course of ordinary activities is measured at their fair value of the
consideration received or receivable, net of returns, and any discounts. Sale of goods revenue included in
trading revenue in the Consolidated Statement of Comprehensive Revenue and Expense:
Revenue is recognised when the amount of revenue can be measured reliably and it is probable that benefits
will flow to the Group, and can be measured at the fair value of consideration received or receivable.
The following specific recognition criteria in relation to the Group’s revenue streams must also be met before
revenue is recognised.
a. Revenue from Exchange Transactions
Joint ventures are accounted for using the equity method.
c. Joint Ventures
Joint ventures are those entities over whose activities the Trust Group has joint control, established by a
binding agreement and requiring unanimous consent for strategic financial and operating decisions.
A survey of the work completed for services under contract at reporting date.
Proportion of time remaining under the original service agreement at reporting date for contracts
spanning more than 12 months for health services.
The proportion of costs incurred to date bear to the total estimated costs of the transaction. Only costs
that reflect the services performed to date are included in costs incurred to date. Only costs that reflect
services performed or to be performed to date are included in the estimated total costs of the transaction.
For sale of Right of First Refusal property it is when the contract has settled in full.
(ii). Rendering of services
Services rendered revenue is recognised in surplus or deficit in proportion to the stage of completion of the
transaction at the reporting date. The stage of completion is assessed by reference to;
The timing of the transfers of risks and rewards varies depending on the individual terms of the sales
agreement.
For sale of annual catch entitlement, it is when the payment has been received by the customer.
Sale or lease of annual catch entitlements from quota share; and
Right of First Refusal property sales.
Revenue is recognised when the significant risks and rewards of ownership have been transferred to the
customer, recovery of the consideration is probable, the associated costs and possible return of goods can be
estimated reliably, there is no continuing management involvement with the goods and the amount of
revenue can be measured reliably.
Amounts received in advance for services to be provided in future periods are recognised as a liability until
such time as the service is provided.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
15te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
$ $
Revenue from exchange transactions
Trading revenue
Services rendered
Holiday park revenue 483,613 472,266
Other exchange revenue 1,815 1,611
Patient and parent fees 1,217,394 1,006,510
Transport Income - 1,372
1,702,823 1,481,759
Sale of Goods
Property sales - 10,379,081
Annual Catch Entitlement sale 766,988 734,952
Total Trading revenue from exchange transactions 2,469,811 12,595,792
2018 2017
$ $
Other Income from exchange transactions
Rental and licence fee Income 2,860,239 2,626,474
Dividends received 71,744 61,183
Gain on sale of NZ Forestry Emission Units 426,000 -
Gain on fixed assets 782 -
Local and Regional council grants 30,000 -
Sundry Income 658,200 592,787
Other Income from exchange transactions 4,046,965 3,280,444
(i). Rental and licence fee income
Rental income on licenced land, residential rental, commercial and other investment property lease fees are
recognised in surplus or deficit on a straight line basis over the term of the lease.
(ii). Dividends
Puna Reo parent fees
Transport revenue
Holiday park revenue
b. Other Income
Income from services rendered (exchange revenue) included in trading income in the Consolidated Statement
of Comprehensive Revenue and Expense:
Patient consultation fees
Income from dividends is recognised when the Group’s right to receive payment is established, and the
amount can be reliably measured.
Revenue from exchange transactions included in other income in the Consolidated Statement of
Comprehensive Revenue and Expense included:
(iii). Sale of NZ Forestry Emission Units
Income from the sale of NZ Emission Units is recognised in the Consolidated Statement of Comprehensive
Revenue when the Group's right to receive payment is established.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
16te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
$ $
Interest Income
Interest from trading, at call and term investments 1,189,904 803,174
Interest received from Historical and Fisheries redress 5,822 -
Interest accrued but not yet received 886,225 1,585,536
Total interest Received 2,081,951 2,388,710
It is probable that the associated future economic benefit or service potential will flow to the entity, and
Fair value can be reliably measured.
(i). Government contracts, grants and koha
Interest income shown in the Consolidated Statement of Comprehensive Revenue and Expense included:
c. Revenue from Non-Exchange Transactions
Non-exchange transactions are those where the Group receives an inflow of resources (i.e. cash or other
tangible or non-tangible items) but provides no (or nominal) direct consideration in return for the inflow. With
the exception of services in kind, inflow of resources from non-exchange transactions are only recognised as
assets where both:
Interest is recognised as it accrues in surplus or deficit, using the effective interest method.
Interest Income shown in other income in the Consolidated Statement of Comprehensive Revenue and
Expense includes interest earned on ‘At call’ funds and short term deposits from the various banking
organisations.
(iv). Interest
(v). Gain/(loss) on revaluation of financial portfolio
The fair value gain/loss on revaluation of financial portfolio is fair value gains on the investment portfolio held
with ANZ.
Capital Coast District Health Board
Ministry of Education
Local and regional agencies
Government contracts
Funding is received to provide a range of health and wellbeing services to the community that are delivered by
the Group. The primary source of funding is derived by contracts with the following providers:
Ministry of Health
The recognition of non-exchange revenue from Government Contracts, Grants, Donations, and Koha depends
on the nature and any stipulations attached to the inflow of economic resources received, and whether this
creates a liability (i.e. present obligation) rather than the recognition of revenue.
Stipulations that are ‘conditions’ specifically require the Group to return the inflow of resources received if
they are not used as stipulated, resulting in the recognition of a non-exchange liability that is subsequently
recognised as non-exchange revenue as and when the ‘conditions’ are satisfied.
Stipulations that are ‘restrictions’ do not specifically require the Group to return the inflow of resources
received if they are not utilised in the way stipulated, and therefore do not result in the recognition of a non-
exchange liability, which results in the immediate recognitions of non-exchange revenue.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
17te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
$ $
Revenue from non-exchange transactions
Health, Medical and Social services revenue 10,216,900 8,589,700
Historical and Fisheries redress 4,854,122 -
Non exchange revenue 15,071,023 8,589,700
2018 2017
$ $
Other revenue from non-exchange transactions
Local and Regional Council grants 271,506 252,157
Other revenue from non-exchange transactions 271,506 252,157
6. Personnel costs
2018 2017
$ $
ACC Levies 40,741 37,346
Staff payroll expense 8,190,715 7,480,571
Board and Committee expense 94,650 89,250
Te Runanga o Toa Rangatira Inc. has paid for Audit and Accounting costs in the the past year. The amounts were reimbursed at 30 June. Administration fees charged to the Trust for the year ended 30 June were $802,980 (2017: $775,039). Current payables owed to Te Runanga o Toa Rangatira Inc. but not yet paid amount to $254,770 (2017: $210,217), amounts outstanding and owed to the Trust by Te Runanga O Toa Rangatira Inc., amount to $26,636 (2017:$26,636) . Toa Rangatira Investment Properties Limited was not advanced any funds. (2017: $NIL).208,939 190,103
Total Payroll expense 8,535,045 7,797,270
(ii). Historical and fisheries redress
The organisation contributes to the New Zealand KiwiSaver scheme for employees who have enrolled in the
scheme.
Personnel costs include:
Personnel expenses include all personnel and include Management, Board and payments for members for
various Committee duties.
a. Employer Contribution to KiwiSaver
Revenue from non-exchange transactions included in the Consolidated Statement of Revenue and Expense
Revenue from non-exchange transactions included in other revenue in the Consolidated Statement of
Comprehensive Revenue and Expense includes:
(iii). Property, plant and equipment revenue
Gains or losses from the sale of property, plant and equipment are recognised in surplus or deficit.
Revenue from Historical and or Fisheries Redress received as non-exchange transactions are recognised when
the entitlement (control) passes to the group and the Group entity is able to enforce the claim. Revenue is
recognised in the Consolidated Statement of Comprehensive Revenue and Expense at an amount that reflects
the exchange at its deemed cost and this is estimated at the date of the exchange.
Redress income included in the Consolidated Statement of Comprehensive Revenue and Expense is
subsequently moved to a special settlement reserve account to preserve the total accumulated settlement
quantum.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
18te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
7. Cash and Cash Equivalents
2018 2017
$ $
Cash and cash equivalents
Current assets
Cash at bank and on hand 10,186,064 11,067,320
At call deposits due within 90 days - -
Cash and cash equivalents in the statement of cash flows 10,186,064 11,067,320
Per annum annual interest rate ranges to components of cash and cash equivalents
Bank deposits 0.00-3.00% 0.00-3.00%
Call deposits 3.22-3.95% 3.22-3.95%
8. Short term investments, long term deposits and managed funds
9. Accounts and other receivables
2018 2017
Accounts and other receivables $ $
Trade Receivables from exchange transactions 3,202,210 1,170,196
Less allowance for doubtful debt (195,888) (187,802)
Net trade receivables from exchange transactions 3,006,322 982,394
Other receivables
Accrued Interest receivable 886,225 1,585,447
Short term wage advances 3,276 4,157
GST receivable (non exchange) 67,883 143,268
Total Trade and other receivables 3,963,706 2,715,266
Accounts and other receivables are non-interest bearing and receipts are normally on 30 day terms. Therefore
carrying value of accounts and other receivables approximates its fair value.
As at 30 June 2018, all overdue receivables have been assessed for impairment and appropriate allowances
made.
Cash and cash equivalents are deposits held in trading accounts or deposits with maturities between 1-90 days
after balance date.
Long term investments are deposits that have maturities more than 12 months after balance date. Long term
investments are classified as non-current assets in the Consolidated Statement of Financial Position.
There are no restrictions over the short term deposits or long term investments held by the Group.
Interest rates vary on the deposits between 3.22% - 3.95%
There are no restrictions over any of the cash and cash equivalent balances held by the Group.
Short term deposits are deposits that are held with maturities of more than 90 days but less than 12 months
after balance date. Short Term Deposits are classified as current assets in the Consolidated Statement of
Financial Position.
Managed funds are funds held with ANZ in a balanced portfolio measured at Fair Value through Surplus and
Deficit
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
19te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
$ $
Balance 1 July 187,802 111,223
Write off of bad debts - -
Impairment losses this year 8,086 76,579
Balance at 30 June 195,888 187,802
10. Prepayments and other assets
2018 2017
$ $
Prepayments for goods and services not yet consumed 34,618 8,758
Engineers Report - Waitangirua 7,500 7,500
Consultants - Takapuwahia Puna Reo - 13,022
Total prepayments and other assets 42,118 29,280
11. Income Tax
The Board have considered whether an allowance for doubtful debts is appropriate based on historical
evidence and have estimated on a percentage basis a doubtful debt allowance on the 90 day and over
balances. All receivables are subject to credit risk exposure.
The Board have reviewed the allowance as at 30 June and a further impairment allowance of $8,086 has been
recorded for the 2018 year.
Ngati Toa Limited receives income which provides taxable earnings. Toa Rangatira Trust has Maori Authority
tax status and the current tax is calculated at 17.5%. Other Trust subsidiaries are currently taxed at 28%.
Ora Toa PHO, Ika Toa Limited and the Parent have Charitable Status for income tax purposes.
Prepayments and other assets include:
Prepayments include payments that have been made prior to balance date, for goods or services that have not
yet been delivered.
Prepayments also include payments toward the construction of an asset where the asset has not yet been
completed or commissioned but for where there is a construction contract in place.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and
liabilities for financial reporting purposes and the amounts used for taxation purposes.
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they
reverse, using tax rates enacted or substantively enacted at the reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities
and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on
different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets
and liabilities will be realised simultaneously.
Tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in surplus or
deficit except to the extent that it relates to a business combination, or items recognised directly in equity or
in other comprehensive income.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
20te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
$ $
Accounting profit from operations 15,463,242 9,067,286
Add taxable inter-entity gain on sale - 375,000
Less non assessable earnings (12,328,145) (5,379,210)
Add back non-deductible expenses 434,803 995,101
Add back temporary timing differences - 49,456
Group Losses offset against this years tax expense (32,820) (32,820)
Taxable Earnings 3,537,080 5,074,813
Opening tax payable 15,085 289,320
Plus current income tax expense 573,974 984,347
Less over provision in previous year (42,673) (9,384)
Current income tax expense 531,301 974,963
Less Maori Tax credits available (12,555) (10,707)
Less Resident withholding tax paid (409,418) (460,014)
Less tax payments made to Inland Revenue (477,863) (1,011,065)
Less refunds received 38,002 232,587
Current Tax payable (315,448) 15,085
12. Property, Plant and Equipment
a. Recognition and measurement
Items of property plant and equipment are initially measured at cost, except those acquired through non-
exchange transactions which are instead measured at fair value as their deemed cost at initial recognition.
Heritage assets with no future economic benefit or service potential other than their heritage value are not
recognised in the statement of financial position.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to
the extent that it is probable that future taxable profits will be available against which they can be utilised.
Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer
probable that the related tax benefit will be realised.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
21te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Any revaluation losses in excess of credit balance of the revaluation surplus for that class of property, plant
and equipment are recognised in surplus or deficit as impairment.
All of the Group's items of property plant and equipment are subsequently measured in accordance with the
cost model, except for land and buildings which are subsequently measured in accordance with the
revaluation model.
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of self-
constructed assets includes the following:
Fair value, less accumulated depreciation and accumulated impairment losses recognised after the date of the
most recent revaluation. Valuations are performed with sufficient frequency to ensure that the fair value of a
revalued asset does not differ materially from its carrying amount.
Gains and losses on revaluation are recognised in other comprehensive revenue and expense and presented in
the revaluation surplus reserve within net assets/equity. Gains or losses relating to individual items are offset
against those from other items in the same class of property, plant and equipment, however gains or losses
between classes of property, plant and equipment are not offset.
Cost (or fair value for items acquired through non-exchange transactions) less accumulated depreciation and
impairment.
(ii). Revaluation model
Items of property, plant and equipment are subsequently measured either under the:
(i). Cost model
Any gain or loss on disposal of an item of property, plant and equipment (calculated as the difference between
the net proceeds from disposal and the carrying amount of the item) is recognised in surplus or deficit.
Upon disposal of revalued items of property, plant and equipment, any associated gain or losses on
revaluation to that item are transferred from the revaluation surplus to accumulated surplus.
b. Subsequent expenditure
Purchased software that is integral to the functionality of the related equipment is capitalised as part of
that equipment.
When parts of an item of property, plant and equipment have different useful lives, they are accounted for as
separate items (major components) of property, plant and equipment.
Subsequent expenditure is capitalised only when it is probable that the future economic benefits associated
with the expenditure will flow to the Group. Ongoing repairs and maintenance is expensed as incurred.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
22te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Constructions Contracts (work in progress)
Rugby Street - Earthquake Strengthening and new medical centre fit-out 2018 2017
$ $
Initial Contract sum - 576,499
Agreed variations to date - 127,792
Revised contract sum - 704,291
Other Construction costs - 170,789
Total Work in progress - 875,080
Payments made prior to balance date - (875,080)
Contract sum payable at 30 June - -
3-5 years
5 - 100 years
3 - 25 years
3-5 years
c. Depreciation
Buildings and Improvements
Plant, Office, MPD and
Computer Equipment
Motor Vehicles, Watercraft,
Tractors and Trailers
Fixtures and Fittings
Computer Equipment
10-50 years
3-5 years
5 - 100 years
3 - 25 years
3-5 years
10-50 years
Included in construction contracts for assets not yet completed (Work in Progress assets) were:
Depreciation is recognised in surplus or deficit on a straight-line basis over the estimated useful lives of each
component of an item of property, plant and equipment. Leased assets are depreciated over the shorter of the
lease term and their useful lives unless it is reasonably certain that the Group will obtain ownership by the end
of the lease term. Land is not depreciated. Assets under construction are not subject to depreciation until they
are completed.
Depreciation methods, useful lives and residential value are reviewed are each reporting date and adjusted if
appropriate.
Work in Progress
For plant and equipment, depreciation is based on the cost of an asset less its residual value, and for buildings
is based on the revalued amount less its residual value. Significant components of individual assets that have a
useful life that is different from the remainder of those assets, those components are depreciated separately.
The estimated useful lives are shown below:
Class 2018 Useful Life Years 2017 Useful Life Years
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
23te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Land, Buildings,
Marine Farm
Plant, Office
Equipment, and
Computers
Fixtures and
Fittings
Motor Vehicles,
Watercraft,
Trailers and
Tractors
Work in Progress
Assets TOTAL
Group 2018 $ $ $ $ $ $
Cost
Balance 1 July 2017 17,149,510 2,595,840 774,221 1,213,688 - 21,733,259
Additions - exchange 622,115 149,421 4,324 30,865 36,264 842,990
Additions - non- exchange - - - - - -
Revaluation movements - - - - - -
WIP capitalised - - - - - -
Disposals (4,000) (435,775) (196,773) (83,561) - (720,109)
Balance 30 June 2018 17,767,625 2,309,486 581,772 1,160,992 36,264 21,856,140
Accumulated depreciation and impairment
Balance 1 July 2017 559,322 2,117,499 606,045 989,339 - 4,272,205
Current year depreciation 299,592 208,026 8,827 75,467 - 591,912
Current Year Impairment - - - - - -
Depreciation written back on revaluation - - - - - -
Depreciation written back on disposal (4,000) (391,413) (185,749) (88,362) - (669,524)
Balance 30 June 2018 854,914 1,934,112 429,123 976,444 - 4,194,593
Carrying amount 30 June 2018 16,912,711 375,374 152,649 184,548 36,264 17,661,547
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
24
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Land, Buildings,
Marine Farm
Plant, Office
Equipment, and
Computers
Fixtures and
Fittings
Motor Vehicles,
Watercraft,
Trailers and
Tractors
Work in Progress
Assets TOTAL
Group 2017 $ $ $ $ $ $
Cost
Balance 1 July 2016 12,718,473 2,164,524 768,471 1,223,249 875,080 17,749,797
Additions - exchange 3,072,262 431,316 5,750 16,173 - 3,525,501
Additions - non- exchange - - - - - -
Revaluation movements 1,228,042 - - - - 1,228,042
WIP capitalised 875,080 - - - (875,080) -
Disposals (744,347) - - (25,734) - (770,081)
Balance 30 June 2017 17,149,510 2,595,840 774,221 1,213,688 - 21,733,259
Accumulated depreciation and impairment
Balance 1 July 2016 545,226 1,915,055 592,385 934,059 - 3,986,725
Current year depreciation 249,987 202,444 13,660 81,014 - 547,105
Current Year Impairment - - - - - -
Depreciation written back on revaluation (194,312) - - - - (194,312)
Depreciation written back on disposal (41,579) - - (25,734) - (67,313)
Balance 30 June 2017 559,322 2,117,499 606,045 989,339 - 4,272,205
Carrying amount 30 June 2017 16,590,188 478,341 168,176 224,349 - 17,461,054
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
25
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
13. Investment properties
Other land valuations were updated on 18th August 2018 by Duncan Watts and Gerad Wilson of CBRE, and
by Bill Smith of Quotable Valuations Limited. The valuations included land that is currently subject to long
term lease back arrangements with the relevant Crown agencies. See Note 23 for further detail on the terms
of the leases. The methods of valuation used to determine fair value were the Income capitalisation or
discounted cashflow approach with a check by the direct comparison approach.
Investment properties are subsequently measured at fair value by an independent professional.
Any gain or loss on disposal of an investment property (calculated as the difference between the net
proceeds from disposal and the carrying amount of the item) is recognised in surplus or deficit.
The forestry land valuation was updated in June 2018 by Forestry Land Consultants Limited on a discounted
cash flow basis which uses forest licence fee income as an input.
Investment property is initially measured at cost, except those acquired through non-exchange transactions
which are instead measured at fair value as their deemed cost at initial recognition.
Cost includes expenditure that is directly attributable to the acquisition of the investment property. The cost
of self-constructed investment property includes the cost of materials and direct labour, any other costs
directly attributable to bringing the investment property to a working condition for their intended use and
capitalised borrowing costs.
Investment property is property held either to earn rental income or for capital appreciation or for both, but
not held for sale in the ordinary course of business, use in the production or supply of goods or services or for
administrative purposes.
a. Recognition and measurement
Valuation detail
The Group engaged Jim Sampson of Alex Hayward Limited to value properties in the Blenheim District. The
methods of valuation used represented observable prices in an active market and were completed between
1st and 20th July 2017 for the year ended 30 June 2017.
Market source data has been used to determine the market value of the properties assessed Alex Hayward
Limited.
All valuers used by the organisation are independent.
The valuer used a comparison approach using recent market transactions that had occurred on an arm’s
length basis. Land is valued at fair value using market-based evidence based on its highest and best use with
reference to comparable land values.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
26 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
Investment property - land $ $
Opening Balance as at 1 July 46,067,098 42,555,578
Gain on revaluation 3,325,980 2,788,295
Fair value of forestry land at 30 June 49,393,078 45,343,873
Additions - Non-exchange - -
Additions -exchange 2,402,926 728,225
Impairment - (5,000)
Disposals - -
Fair value 30 June 51,796,004 46,067,098
14. Share Investments
Both CBRE and Quotable Valuation Limited are independent valuers.
The Group owns 1,532 shares in Aotearoa Fisheries Limited (AFL). The shares were received as part of the
Fisheries settlement in March 2010. The parent has no controlling or significant interest in AFL.
The shares are stated at cost less their impairment value as the company (AFL) shares are not publicly traded
and therefore there is no active market to determine the quoted price and the shares cannot be measured
reliably.
When the use of the investment property changes to owner occupied, such that it results in a reclassification
of property, plant and equipment, the property’s fair value at the date of reclassification becomes its cost for
subsequent accounting.
Investment property includes land purchased from the Crown identified as part of the redress negotiation.
The land was purchased at $24 million on 1 August 2014. The land includes land in Nelson and Marlborough
currently planted in pine and is operated as a forestry operation. The forestry operation is owned and
controlled by unrelated parties and the land is leased to the Forester under the terms of present Crown
Forestry Licence.
Other land (non-exchange) is held as investment land where there has been no clear indication on a
particular use for the land.
Investment property transactions are shown below:
b. Reclassifications
When an investment property that was previously classified as property, plant and equipment is sold, any
revaluation amount included in the revaluation reserve is transferred to retained earnings.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
27 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
The shares are classified as available for sale.
2018 2017
$ $
Aotearoa Fisheries Limited 2,366,678 2,366,678
Deemed cost at 30 June 2,366,678 2,366,678
15. Trade and other payables
2018 2017
$ $
Trade payables from exchange transactions 332,790 229,684
Sundry accruals 274,739 515,745
GST payable 165,635 165,483
Total trade and other payables 773,164 910,912
16. Deferred IncomeDeferred Income
17. Rent received in AdvanceRent received in Advance
Forestry Licence fees, residential rent and rent from lease back investment properties received in advance is
rent received for future periods, the service has not yet been delivered to the customer and the revenue is
deferred to another period.
At 30 June all deferred income related to service contract income where the obligations attached to the
receipt of the funds has not been fully met at balance date.
Deferred service income relates to government contract income for the Medical and Health services where
the obligations attached to the receipt of the funds have not fully been met at balance date. These
conditions and or obligations are all expected to be met within 30 to 60 days of balance date and are
considered current liabilities.
Deferred income related to assets is funding provided from the Crown (New Zealand Government) for
infrastructure assets such as computer hardware and medical equipment. The funds deferred to future
periods represent amounts that have not been spent at balance date.
The shares have returned a dividend for the past three years and as such the directors have assessed that the
'value in use' is appropriate. As there is no indication of impairment at balance date the Board consider that
the carrying amount of the shares approximates their fair value.
Trade payables are non-interest bearing and are normally settled within 30 days and are therefore reflected
at their fair value.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
28 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
18. Employee EntitlementsEmployee Entitlements
2018 2017
$ $
Current
Short-term employee entitlements 597,844 528,477
Taxes payable 100,710 -
Total employee entitlements 698,554 528,477
19. Financial instruments
The Group also derecognises financial assets and financial liabilities when there have been significant changes
to the terms and/or the amount of the contractual payments to be received and or paid.
The Group classifies financial liabilities into the following categories: fair value through surplus or deficit, and
amortised cost.
Financial assets and liabilities are offset and the net amount presented in the statement of financial position
when, and only when the Group has a legal right to offset the amount and intends either to settle on a net
basis or to realise the asset and settle the liability simultaneously.
The Group classifies the financial assets into the following categories: fair value through surplus or deficit,
held-to-maturity, loans and receivables and available for sale.
The Group initially recognises financial instruments when the Group becomes a party to the contractual
provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire,
or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the
risks and rewards of ownership of the financial asset are transferred. Any interest in transferred financial
assets that is created or retained by the Group is recognised as a separate asset or liability. The Group
derecognises a financial liability when its contractual obligations are discharged, cancelled or expire.
Short-term employee benefit liabilities are recognised when the Group has a legal or constructive obligation
to remunerate employees for services provided within 12 months of reporting date, and are measured on an
undiscounted basis and expensed in the period in which employment services are provided.
These mainly consist of accrued holiday entitlements at the reporting date.
No long term obligations exist at 30 June 2018.
a. Short term employee benefits
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
29 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Changes in impairment provisions attributable to application of the effective interest method are reflected as
a component of interest income. If, in a subsequent period, the fair value of an impaired available-for- sale
debt security increases and the increase can be related objectively to an event occurring after the impairment
loss was recognised, then the impairment loss is reversed, with the amount of the reversal recognised in
surplus or deficit. However, any subsequent recovery in the fair value of an impaired available-for-sale equity
security is recognised in other comprehensive revenue and expense.
Equity investments are shares in Aotearoa Fisheries Limited (AFL) and are measured at cost less any
impairment charges, as they do not have a quoted market price and their value cannot be reliably measured.
All other available-for-sale financial assets are measured at fair value. Gains and losses are recognised in
other comprehensive income and expense and are reported within the "available-for-sale reserve" within
equity, less and impairment expense.
When the asset is disposed of or is determined to be impaired the cumulative gain or loss recognised in other
comprehensive income is reclassified from the equity reserve to surplus or deficit and presented as a
reclassification adjustment within other comprehensive income. Any associated interest income or dividends
are recognised in surplus or deficit within "investment income".
Available-for-sale financial assets are non-derivative financial assets that are either designated to this
category or do not qualify for inclusion in any of the other categories of financial assets.
Available-for-sale financial assets include:
Aotearoa Fisheries Limited Income shares
Loans and receivables comprise: The Group’s cash and cash equivalents, trade and other receivables.
Cash and cash equivalents, short term deposits and long term deposits represent highly liquid investments
that are readily convertible to a known amount of cash with an insignificant amount of risk of changes in
value, with maturities of 90 days or less.
b. Available-For-Sale Financial Assets
a. Loans and Receivables
Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an
active market.
Loans and receivables are subsequently measured at amortised cost using the effective interest method, less
any impairment losses.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
30 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
When an event occurring after the impairment was recognised causes the amount of impairment loss to
decrease, the decrease in impairment loss is reversed through surplus or deficit.
Assets that are not individually significant are collectively assessed for impairment by grouping together
assets with similar risk characteristics.
In assessing collective impairment the Group uses historical trends of the probability of default, the timing of
recoveries and the amount of loss incurred, adjusted for management's judgement as to whether current
economic and credit conditions are such that the actual losses are likely to be greater or less than suggested
by historical trends.
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the difference
between its carrying amount and the present value of the estimated future cash flows discounted at the
asset's original effective interest rate. Losses are recognised in surplus or deficit and reflected in an allowance
account against loans and receivables or held-to-maturity. Interest on the impaired asset continues to be
recognised.
e. Financial assets classified as held-to-maturity and loans and receivables
The Group considers evidence of impairment for financial assets measured at amortised cost (loans and
receivables and held-to-maturity) at both a specific asset and collective level.
All individually significant assets are assessed for specific impairment. Those found not to be specifically
impaired are then collectively assessed for any impairment that has been incurred but not yet identified.
d. Impairment of non-derivative financial assets
A financial asset not subsequently measured at fair value through surplus or deficit is assessed at each
reporting date to determine whether there is objective evidence that it is impaired. A financial asset is
impaired if there is objective evidence of impairment as a result of one or more events that occurred after
the initial recognition of the asset, and that the loss event(s) had an impact on the estimated future cash
flows of that asset that can be estimated reliably.
Objective evidence that financial assets are impaired includes default or delinquency by a counterparty,
restructuring of an amount due to the Group on terms that the Group would not consider otherwise,
indications that a counterparty or issuer will enter bankruptcy, adverse changes in the payment status of
borrowers or issuers in the Group, economic conditions that correlate with defaults or the disappearance of
an active market for a security. In addition, for an equity security classified as an available-for-sale financial
asset, a significant or prolonged decline in its fair value below its cost is objective evidence of impairment.
Financial liabilities classified as amortised cost are subsequently measured at amortised cost using the
effective interest method.
Financial liabilities classified as amortised cost include cash and cash equivalents (bank overdrafts), trade and
other payables.
c. Amortised cost financial liabilities
Financial liabilities classified as amortised cost are non-derivative financial liabilities that are not classified as
fair value through surplus or deficit financial liabilities.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
31 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
TOTAL
Group 2018 NOTELoans and
receivables
Fair Value
through
surplus &
deficit
Available for sale
Subsequently measured at fair value
Aotearoa Fisheries Limited shares 14. - -
2,366,678 - 2,366,678
Not subsequently measured at fair value
Cash and cash equivalents 7. 10,186,064 - - - 10,186,064
Short term deposits 8. 68,497,394 - - - 68,497,394
Managed funds - 22,953,237 - - 22,953,237
Receivables 9. 3,202,210 - - - 3,202,210
Payables 15. - - - (332,790)
81,885,668 22,953,237 2,366,678 106,872,794
TOTAL
Group 2017 NOTELoans and
receivables
Fair Value
through
surplus &
deficit
Available for sale
Subsequently measured at fair value
Aotearoa Fisheries Limited shares 14. - - 2,366,678 - 2,366,678
Not subsequently measured at fair value
Cash and cash equivalents 7. 11,067,320 - - - 11,067,320
Short term deposits 8. 52,686,209 - - - 52,686,209
Long term deposits 8. 6,943,688 - - - 6,943,688
Managed funds - 21,322,329 - 21,322,329
Receivables 9. 1,170,196 - - - 1,170,196
Payables 15. - - - (229,684)
71,867,413 21,322,329 2,366,678 95,326,736
Carrying value of Financial Instruments $
Financial Assets Financial Liabilities
f. Fair Value through Surplus or Deficit
A financial instrument is classified as fair value through surplus or deficit if it is:
Held for trading: Derivatives where hedge accounting is not applied
Designated at initial recognition: If the Group manages such investments and makes purchase and sale
decisions based on their fair value in accordance with the Group's documented risk management or
investment strategy. Those fair value through surplus or deficit instruments sub-classified as held-for-trading
comprise the ANZ Managed Funds. Financial instruments classified as fair value through surplus or deficit are
subsequently measured at fair value with gains or losses being recognised in surplus or deficit.
The table below shows the carrying amount of the Group’s financial assets and liabilities:
Carrying value of Financial Instruments $
Financial Assets Financial Liabilities
(229,684)
Liabilities (at
amortised cost)
Liabilities (at
amortised cost)
(229,684)
(332,790)
(332,790)
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
32 te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
20. Intangible assets
2018 2017
Website Design Cost $ $
Gross carrying amount
Balance 1 July 52,138 42,138
Additions - website development - 10,000
Balance 30 June 52,138 52,138
Amortisation and impairment
Balance 1 July (42,138) (42,138)
Amortisation (1,992) -
Balance 30 June (44,130) (42,138)
Carrying amount 30 June 8,008 10,000
Amortising is recognised in surplus and deficit on a straight line basis over the estimated useful life of each
amortisable intangible asset. The estimated useful lives of each amortisable intangible asset are:
Quota Share
The Group’s finite-life intangible assets comprise: A website and Goodwill
a. Recognition and measurement
Intangible assets are initially measured at cost except for:
b. Subsequent expenditure
Intangible assets acquired through non-exchange transactions (measured at fair value)
Heritage assets
NZ Forestry Emission Units
Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific
asset to which it relates. All other expenditure is recognised in surplus or deficit.
c. Amortisation
Websites
Goodwill 10 Years
Heritage assets with no future economic benefit or service potential other that their heritage value are not recognised
on the Consolidated Statement of Financial Position.
Website 5 Years (2017: 5 years)
The Group holds land that is classified as heritage as the land comprises sites that are either held as reserves,
memorial sites or Urupa.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
33te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
Goodwill - Waitangirua Medical Centre $ $
Balance 1 July - -
Additions - purchases 480,000 -
Balance at 30 June 480,000 -
Impairments
Impairment losses (32,000) -
Balance 30 June (32,000) -
Carrying amount 30 June 448,000 -
2018 2017
NZ Forestry Emissions Units $ $
Balance 1 July 7,718,448 9,795,134
Gain on sale of units 426,000 -
Fair value gain on units at reporting date 580,102 -
8,724,550 9,795,134
Impairments
Loss on revaluation - (291,686)
Disposals (5,586,000) (1,785,000)
Fair value 30 June 3,138,550 7,718,448
The New Zealand Emissions Trading Scheme (ETS) is the system in which New Zealand Units (NZUs) are traded. Under
the ETS, certain sectors are required to acquire and surrender NZUs or other eligible emission units to account for
their direct greenhouse gas emissions or emissions associated with their products.
The allocation attached to the forestry lands purchased by the Trustee of the Toa Rangatira Trust, was allocated as
part of a compensation package for those forests that were planted pre-1990. The NZ Emissions Units received into
the Trust are pre-1990 emission trading units.
The NZ Emissions Units transferred on 29 August 2014, 548,744 units were transferred to the Toa Rangatira Trust
along with the Crown Forestry Licenced rentals. The NZ Emissions Units were initially recognised in the Consolidated
Statement of Comprehensive Income at the rate per unit as listed on the Carbon Forest Services site at 29 August
2014. This value was the deemed cost. The NZU’s have been subsequently revalued at each balance date to
determine whether there has been any impairment also using the prevailing rate listed for the NZU’s, with the
revaluation gain going through Other Comprehensive Income. The Board resolved to sell down units during 2018
(2017:100,000 units). The income from the sale is included in Other Revenue and Expense in the Statement of
Comprehensive Revenue and Expense, and the previous fair value gain on valuation has been reversed.
In October 2017, the parent purchased the systems and processes of Waitangirua Medical Centre for $480,000. This
included access to the patient database, and continuing with essentially the same doctors and staff. No shares were
acquired.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
34te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Quota shares 2018 2017
$ $
Opening Balance 1 July 8,257,346 7,671,171
Gain in fair value 540,517 586,175
Fair value at 30 June 8,797,863 8,257,346
Quota received as a non-exchange transaction (Settlement quota) is measured initially at a deemed cost which is
determined using the values placed on the quota as per the documentation received with the settlement quota.
d. Quota Share
Quota shares are treated as an intangible asset. Quota Shares that are purchased at cost are recognised initially at
cost and subsequently at fair value. Fair value is determined as the latest valuation less any impairment cost.
Valuations are undertaken on a regular basis to ensure the carrying amount does not differ materially from the fair
value of the shares.
A valuation was obtained by Quota Brokers Aotearoa as at 30 June 2017 for the quota share. The valuation records an
increase of $586,175 at balance date. The increase in value has been recorded as a gain in the Consolidated
Statement of Comprehensive Revenue and Expense. A Directors valuation was completed as at 30 June 2018 for the
quota shares held. The increase in value of $540,517 has been recorded as a gain in the Consolidated Statement of
Comprehensive Revenue and Expense. The valuation is based on recent market prices available.
As part of receiving the Golden Downs East, Golden Downs West and Queen Charlotte forest land on
settlement, 548,747 pre-1990 NZ Units were received. The Trustees expect that the current licensors will continue to
replant and keep these areas forested for the term of the licences (31+ years ). The Trustees do not consider the
land suitable for a purpose other than forestry. In the event that areas of land are handed back in accordance with the
Crown licence term during or at the end of the term, the trustees expectation is that the land would either be
replanted or that native bush would be allowed to regenerate. In the event that the land is handed back, is not
replanted, and that native bush has not regenerated to the correct density within ten years of the land hand back,
then a liability may be incurred. This potential liability is not recognised in the financial statements.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
35te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
21. Investment in Joint Venture
2018 2017
$ $
Share of net assets of Kenepuru Partnership Limited Joint Venture 10,135,493 8,570,752
Share of net assets of joint venture at 30 June 10,135,493 8,570,752
2018 2017
$ $
Share of loss in joint venture 49,257 31,610
Total share of loss in joint venture 49,257 31,610
22. Impairment of non-financial assets
a. Jointly controlled entities
The recoverable amount of the asset or CGU is the greater of its value in use and its fair value less costs to sell. In
assessing value in use, the estimated cash flows (for cash generating units) or future remaining service potential (for
non-cash generating units) are discounted to their present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks specific to the asset or CGU.
Cash generating assets and non-cash generating assets are distinguished by the smallest identifiable unit that is used
to generate a cash inflow from continuing use that are largely independent of the cash inflows from other assets or
groups of assets.
The carrying amount of the Group’s non-financial assets, other than investment property, are reviewed at reporting
date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s
recoverable amount is estimated.
Indefinite life intangible assets and intangible assets not yet available for use are tested annually for impairment. An
impairment loss is recognised if the carrying amount of the asset or its cash generating unit (CGU) exceeds its
estimated recoverable amount.
The Group holds joint control over the following jointly controlled entity, which is accounted for using equity method.
The Whenua Toa Trust was setup in October 2016 as the limited partner in the Kenepuru Partnership Limited joint
venture. The Whenua Toa Trust is a 50% shareholder in the joint venture.
b. Commitments from interest in joint ventures
The Group has committed to contributing capital of $11,500,000. Of this, $11,252,360 has already been committed for
the year ended 30 June 2018 (2017: $8,977,360).
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
36te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
23. Leases (as lessor and lessee)
2018 2017
Current rental payments commitments as Lessee $ $
Within one year 132,489 57,093
Between one and five years 26,728 52,305
More than five years - -
Total operating lease rentals payable 159,217 109,398
Per Annum
Amount
Organisation Rental Term Expiry $
Sietec Communication UFB Line Management 60 Months June 2019 18,000
Sietec Wholesale Wider Area Network 60 Months June 2019 39,060
Waitangirua Medical Centre Medical Practice Building 24 Months October 2020 6,682
Porirua City Council Shelter 36 Months April 2019 4,800
The leases terms vary between two to three years.
The parent purchased the building in Rugby Street, Wellington in 2009 and is utilising the property for its Wellington
based medical and health services. The property currently has multiple tenancies who lease remaining units under
operating leases.
a. Lease payments as lessee
The leases that are currently in place for the Group are summarised below.
The following operating leases are in place at Balance date.
Leases where the Group assume substantially all the risks and rewards incidental to ownership of the leased asset are
classified as finance leases. All other leases are classified as operating leases.
Subsequent to initial recognition (at cost) the asset is accounted for in accordance with the accounting policy
applicable to the asset.
Rental lease revenue received under operating leases is recognised on a straight line basis over the term of the lease.
This excludes receipts from reimbursements for services which are recognised when the customer has received an
invoice for the service.
c. Current Rental revenue as lessor
Payments made under an operating lease are recognised in surplus and deficit on a straight line basis over the term of
the lease. Lease incentives received are recognised as an integral part of the total lease and are expensed over the
lease term. Associated costs such as maintenance and insurances are expensed as incurred.
Depreciation on the leased asset is expensed in a manner that is consistent with the accounting policy disclosed at
Note 12 Property, plant and equipment.
The Group leases the land that houses the Waka Ama equipment. The lease runs for 36 months and commenced April
2016.
b. Rental lease revenue as lessor
Costs incurred in earning the rental lease revenue are recognised as an expense as they are incurred.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
37te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
$ $
Within one year 2,642,246 2,554,340
Between one and five years 10,297,982 10,106,703
More than five years 55,938,769 57,057,176
Total minimum future lease receivable 68,878,997 69,718,219
24. Reserves
2018 2017
Treaty and Fisheries Redress Reserve $ $
Opening balance 131,910,855 131,910,855
Movements this year 4,854,122 -
Closing balance 136,764,977 131,910,855
2018 2017
Revaluation reserve - intangibles $ $
Opening balance 10,593,663 11,669,174
Movements this year (2,794,381) (1,075,511)
Closing balance 7,799,282 10,593,663
a. Treaty and Fisheries Redress Reserve
b. Other Reserves
This reserve records the increases or decreases in Quota Holdings (Fish species) only to the extent that they offset
each other. This reserve also records the increases or decreases in the fair value of the NZ Emissions Units. The
reserve cannot fall into deficit.
The Rugby Street property is included in 'Land, buildings and marine farm' and is depreciated over the estimated
useful life of the asset as determined by the Board for that class of asset. Any expense that relates to the revenue is
expensed in the period it is incurred and is included in Administrative costs as shown in the Consolidated Statement of
Comprehensive Revenue and Expense. The rental income is recognised on a straight line basis over the term of the
lease.
The Toa Rangatira Investment Company manages the rental income of the Forestry lands that were purchased from
the Crown on 1 August 2014. The current Crown Forestry Licence has a termination date of 30 years. The licence fees
are reviewed every 3 years (periodic review) and the methodology can be reviewed every 9 years (general review).
The minimum future lease receivable expected over the next five years is shown below:
Cash funds and other assets (land, buildings, quota share etc.) received from the Treaty of Waitangi Claims are initially
recorded through the Consolidated Statement of Comprehensive Revenue and Expense and are then transferred to
the Treaty and Fisheries Redress Reserve. An additional reserve representing an historical disagreement within Iwi,
which has now been settled, is included in the other special purpose reserve. These funds are separately distinguished
reserves so as to retain the core amounts received under settlement.
(i). Revaluation reserve – intangible assets
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
38te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017
Revaluation reserve - land and buildings $ $
Opening balance 5,832,408 4,774,547
Movements this year - 1,057,861
Closing balance 5,832,408 5,832,408
2018 2017
Other special purpose reserve $ $
Opening balance 1,186,078 1,186,078
Movements this year - -
Closing balance 1,186,078 1,186,078
Total reserves 151,582,745 149,505,354
25. Contingencies and Commitments
There were no known contingent liabilities as at 30 June 2018.
c. Commitments
The Whenua Toa Trust has entered into a Joint Venture agreement to develop the old Kenepuru Hospital site. The site
will be developed into residential and commercial sites by a joint venture development company. The Whenua Toa
Rangatira Trust has committed $11,500,000 capital to the joint venture development and will hold 50% of the shares
in the development company, $9,241,310 has been paid for the year ended 30 June 2018 (2017: $8,602,362). A
further loan advance has been approved to assist with ongoing development and interest is payable on the loan at
6.5% per annum. No calls were made on the additional loan as at 30 June 2018.
There is a commitment for the roof replacement for 17-19 Prosser Street. The committed amount is approx. $60,000.
There is a commitment to Port Nicholson Fisheries Partnership to supply the Annual Catch Entitlement for Crayfish,
and to Aotearoa Fisheries Limited to supply the Annual catch Entitlement for a number of Species including Orange
Roughy, both supplies are at the applicable market value for a five year period ending in 2019.
There is a commitment for the replacement of 19 motor vehicles across the Ora Toa Health units. The Board approved
$285,000 in July 2018. The vehicles will be leased back to the specific contracted area.
Other than commitments in the ordinary course of business there are no commitments at balance date. All major
projects that were in progress at 30 June are now completed.
(ii). Revaluation reserve - land and buildings
a. Contingent Assets
b. Contingent Liabilities
There were no known contingent assets as at 30 June 2018.
The other special purpose reserve represents the funds from the historical Iwi dispute, transferred across from Ika Toa
Limited to Te Runanga o Toa Rangatira Inc. The funds have been held separately to retain the identity.
(iii). Other special purpose reserve
This reserve records the increases and decreases in the fair value of land and buildings only to the extent that they
offset each other. Land and buildings are revalued on a five yearly basis or where there is an indication that the
carrying amount may be materially different.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
39te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
26. Events Subsequent to Balance Date
27. Related Parties
The Board have agreed to place a further $30 million into managed funds with Milford Investments ($20m) and
Harbour assets ($10m)
• Ngati Toa Limited trades as a Holiday park in Paekakariki.
• Ora Toa PHO Limited is the Primary Health organisation for the Medical and Health units operated by the Parent.
All investments in subsidiaries are carried at cost less accumulated impairment losses in the financial statements of
the Parent and are eliminated on consolidation.
• Toa Rangatira Trust is the Post Settlement Governance Entity, formed December 2012 to receive the historical
settlement.
• Ika Toa Limited received income from trading its Annual Catch Entitlement from the Quota Share.
The consolidated financial statements include the financial statements of the ultimate controlling entity, its
subsidiaries and other controlled entities, are listed below. Te Runanga o Toa Rangatira Inc. as parent consolidates
the subsidiaries as it has 100% control of the financing and operations of the companies so as to obtain any and all
benefits from their activities.
Kenepuru Developments has confirmed the final price for the sale of stage 1 Kenepuru landings. The 144 sections in
stage 1(a) and 1(b) have been sold for $24,320,000.
There are two larger commercial sites under contract. One site is under contract for $3,000,000 and the other site is
under contract for $13,000,000. Both sites have specific terms and conditions of sale that need to be satisfied before
they are unconditional.
The Group entered into non-binding memorandum of understanding with the Crown on 1 November 2018. At the
conclusion of the due diligence period a new entity Te Āhuru Mōwai will be established as a registered class 1 social
landlord (community housing provider) under the Community housing registration authority (CHRA). Te Āhuru Mōwai
will manage approximately 900 Housing New Zealand properties on commercial terms on the western side of Porirua
under a lease arrangement with a 25 year initial term. The contractual agreements once executed provide for call
options, asset management and redevelopment opportunities. The tenancy management arm is expected to be
operational by the end of 2019.
Whenua Toa Trust was established as the limited partner in the Kenepuru Partnership Limited. The board appointed
Trustees are Ta Matu Rei, Taku Parai, and Francis Freemantle.
In the prior year Toa Rangatira Trust loaned Whenua Toa Trust $11,621,605. This remains outstanding at balance date.
Interest of $756,648 was paid in 2018 (2017: $NIL)
• Toa Rangatira Group Holdings Limited (previously Toa Rangatira Limited) has not traded. Toa Rangatira Limited was
previously a subsidiary of Te Runanga o Toa Rangatira Inc. The company name was changed on 8th July 2014 and the
shareholding transferred to Toa Rangatira Trust in which Te Runanga o Toa Rangatira Inc. is a Trustee.
The subsidiaries of Toa Rangatira Group Holdings Limited are Toa Rangatira Investment Properties Limited and Toa
Rangatira Developments Limited. These companies were incorporated on 8th July 2014.
Any surplus and or deficit is included in, and attributed to the Parent. No Dividends were paid to the ultimate
controlling entity during 2018 (2017: NIL). All entities have a 30 June balance date.
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
40te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
Ngati Toa Limited is a holiday park. Te Runanga o Toa Limited leases the holiday park buildings to Ngati Toa Limited
and also provides administrative services to Ngati Toa Limited. The amounts received during the year were
administration $19,946 (2017:$18,877), lease of land and buildings $54,178 (2017: $54,456) and interest $14,530
(2017: $14,558). Outstanding receivables owed by Ngati Toa Limited as at 30 June 2017 amounted to $12,377 (2017:
$14,207). Loan payable to Ngati Toa Limited by Te Runanga o Toa Rangatira Inc. amount to $252,779 (2017:
$252,842).
Te Runanga o Toa Rangatira Inc. has paid for Audit and Accounting costs in the the past year. The amounts were
reimbursed at 30 June. Administration fees charged to the Trust for the year ended 30 June were $819,678 (2017:
$790,737). Audit reimbursements for 2018 were $30,000 (2017: $37,698). Current payables owed to Te Runanga o
Toa Rangatira Inc. but not yet paid amount to $254,770 (2017: $210,217), amounts outstanding and owed to the Trust
by Te Runanga O Toa Rangatira Inc., amount to $26,636 (2017:$26,636) . Toa Rangatira Investment Properties Limited
was not advanced any funds. (2017: $NIL).
There have been no other transactions between Te Runanga o Toa Rangatira and the trust and subsidiaries. All
transactions between the parent and trust and subsidiaries as shown above have been eliminated on consolidation.
Ika Toa Limited is the asset holding company for the fisheries settlement fund received under the Maori Fisheries Act
2004. The funds were received into Ika Toa Limited in March 2010. Ika Toa Limited manages the settlement assets
and manages the trading of annual catch entitlement (ACE) on behalf of the organisation. A commission fee is paid to
Ika Toa Limited to provide these services. The administrative arm of the organisation charges for reimbursement of
administration services. The amounts received during the year were administration fees $53,700; (2017: $54,726),
Audit reimbursements $13,000 (2017: $11,100), ACE lease fees of $169,146 (2017: $330,377) and interest of $NIL
(2017: $NIL). Outstanding receivables owed by Ika Toa Limited as at 30 June 2018 amounted to $204,208 (2017:
$384,650).
Kapiti Tours Limited provides transportation and guided tours to & from Kapiti Island. Te Runanga o Toa Rangatira
provides administration services to Kapiti Tours Limited. There were no transactions between Kapiti Tours Limited and
any other related companies during 2018 (2017: NIL).
Ora Toa PHO Limited is a Primary Health Organisation (PHO) and provides contract services funding to Te Runanga o
Toa Rangatira Inc. health units and medical centres. The funding received from Ora Toa PHO for 2018 was $5,643,290
(2017: $5,262,869), wage and clinical advisor reimbursements $182,649 (2017 :$159,083), general support services
$36,000 (2017: $30,647) and rent $10,400 (2017: $9600). Audit reimbursements for 2018 were $10,000 (2017:
$10,097). Outstanding receivables owed by Ora Toa PHO Limited as at 30 June 2018 amounted to $621,131 (2017:
$455,450). Outstanding payables owed to Ora Toa PHO Limited as at 30 June 2018 amounted to $NIL (2017: $NIL).
Directors fees $NIL (2017:$1,700), Motor vehicle expenses $13,260 (2017:$12,240).
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
41te rUNAN
Te Runanga O Toa Rangatira Incorporated Group
Notes to the Financial StatementsFor the Year ended 30th June 2018
2018 2017 2018 2017
FTE FTE $ $
Members of the Governing body 27 16 127,705 122,374
Senior Management and committees 6 9 568,450 677,365
30 14 636,873 514,656
Key personnel remuneration 63 39 1,333,028 1,314,395
There are no subsidised Medical or Health benefits available to any staff or key personnel. Other than Employer
contributions to NZ Kiwi saver there are no health, life or superannuation plans.
A director of Ika Toa Limited is a Director and shareholder of Okiwi Bay Aquaculture Limited (OBAL). OBAL manages
the Ika Toa marine farm asset. OBAL manages the conditioning of immature oysters on the company's marine farm
structures and Ika Toa Limited is paid a commission based on the volume of oysters harvested. The sum of $NIL was
received from OBAL for oyster harvest in 2018. Amounts for communication and other services paid to OBAL during
2018 $NIL (2017: $NIL).
Terminating benefits include any long service leave due and or payable. There are no terminating benefits or post-
employment benefits paid or payable.
Members of the governing body (Board members and Company Directors)
Senior Executive Officer and Senior Management, responsible for reporting to the governing board
Members of the governing body are paid $250 for each meeting attended. The Chairperson of the Board is paid $350
for each meeting attended.
A number of family members of key management personnel are employed by the Group on normal employment
terms. Remuneration to close family members of key personnel is included below:
a. Key Management Personnel
The Group classifies its key management personnel into one of two classes:
There are no loans or advances to key management personnel or close family members outstanding at June 2018. No
material advances or loans have been made to key Management personnel during the year. (2017: $NIL)
No interest is received on advances and loan repayments are by way of repayment via wage deduction.
The Manager of the Holiday Park is the spouse of the groundsman and housing accommodation is provided as part of
the contract of service. A taxable allowance is paid for accommodation on a weekly basis. (2018: $5,200, 2017:
$5,200).
Close family members
Key management personnel who
received remuneration
TE RUNANGA O TOA RANGATIRA INCORPORATED FINANCIAL STATEMENTS AND ANNUAL REPORT 2018
42te rUNAN