2010-11 Annual Report - Taranaki District Health Board

Notes to the Financial Statements
For the Year Ended 30 June 2011
The term loans denoted are financed by the Crown Health Financing Agency (acting as an agent of the Crown) on fixed interest rates. The rate of
interest has two components - a fixed rate and a margin. The margin may decrease on account of efficiencies derived by the Crown Health Financing
Agency and passed onto the Taranaki District Health Board, whilst any increase in the margin will be capped and cannot exceed the original margin
agreed at the time of the loan drawdown. Since these loans have no fixed repayment date the Crown Health Financing Agency have not passed any
efficiencies onto Taranaki District Health Board.
Government sector borrowings are unsecured and repayment is classified in line with the terms of borrowing with the Crown Health Financing Agency.
Subsequent to 30 June 2011 a loan on a fixed rate of interest totalling $10 million and due to mature on 31 July 2011 has been refinanced at a fixed
rate of interest of 4.44% to expire on 15 April 2016.
Group
Parent
2011 2010 2011 2010
GOVERNMENT SECTOR BORROWING $000 $000 $000 $000
(post refinancing)
Due for repayment:
within one year - - - -
within two years 7,000 10,000 7,000 10,000
within three years - 7,000 - 7,000
within four years 12,000 - 12,000 -
within five years 10,000 12,000 10,000 12,000
after five years - - - -
29,000 29,000 29,000 29,000
FAIR VALUE OF GOVERNMENT BORROWING
The fair value of the $29,000k of Government Borrowing at 30th June 2011 was calculated at $31,118k (2010: $31,362k). This calculation is done by
discounting the expected future cash flows at prevailing interest rates. Crown Health Financing Agency has used the Government Bond Rate plus 15
basis points based on mid market pricing, this being the same basis on which District Health Board debt is funded, to establish the fair value.
18 EMPLOYEE BENEFITS Group Parent
2011 2010 2011 2010
$000 $000 $000 $000
Salary & wages accrual 3,583 3,295 3,472 3,204
Annual Leave 11,741 11,172 11,426 10,882
Sick Leave 322 364 322 364
Long Service Leave 1,044 919 1,044 919
Retirement gratuities 1,026 928 1,026 928
Continuing Medical Education 1,388 1,141 1,388 1,141
Sabbatical Leave 214 205 214 205
19,318 18,024 18,892 17,643
Made up of:
Current 18,509 17,237 18,083 16,856
Non-current 809 787 809 787
19,318 18,024 18,892 17,643