Information & Knowledge

EQUITY Retained earnings Reserves Total equity attributable to the Entity

Non-controlling interest Total equity CONSOLIDATED 2021 2020 Note $000’s $000’s

132,939 113,017

8 7,643 7,490

140,582 120,507

6,217 5,186

146,799 125,693

The Board of Directors of Te Rūnanga o Ngāti Awa (Group) authorised these financial statements presented on pages 5 - 36 for issue on 29 October 2021.

For and on behalf of the Board.

Chairman | 29 October 2021

The above statement of financial position should be read in conjuction with the accompanying notes. T O’Brien,

Deputy Chairperson | 29 October 2021

The accompanying accounting policies and notes form part of the Financial Statements. Cash flows from operating activities Cash receipts from customers Grant and funding income Dividend Income received Interest income received Tax refunds

Payments to suppliers and employees Grants paid Interest paid Income tax paid Net cash flow from operating activities Cash flows from investing activities Preceeds from the disposal of property, plant and equipment Proceeds from the sale of intangible assets Proceeds from the sale of investments

Purchase of property, plant and equipment Purchase of livestock Purchase of investments

Net cash flow from investing activities Cash flows from financing activities Proceeds from borrowings Capital contribution from non-controlling interest

Distrubtions paid to non-controlling interest Repayment of term loans Payments of derivative activities Purchase of non-controlling interest Repayment of borrowings

Net cash flow from financing activities Net increase / (decrease) in cash, cash equivalents, and bank overdrafts Cash, cash equivalents, and bank overdrafts at the beginning of the year Cash, cash equivalents, and bank overdrafts at the end of the year CONSOLIDATED 2021 2020 Note $000’s $000’s

14,951 11,890

3,057 1,043

1,732 1,594

28 31

- 67

19,768 14,625

(15,925) (11,846)

(376) (335)

(459) (674)

(242)

2,766 1,770

50

30 - 9,738

- 608

50 10,376

(459) (710)

(236) (295)

(6,046) (379) (6,741) (1,384)

(6,691) 8,992

550 1,350 1,900 (40) (212)

(1,729) (120)

(318) (267)

(570)

- (758) (2,657) (1,357)

(757) (1,357)

(4,682) 9,405

9,941 536

9 5,259 9,941

The accompanying accounting policies and notes form part of the Financial Statements.

1 Statement of accounting policies for the year ended 30 June 2021 1.1 Reporting entity

Te Rūnanga o Ngāti Awa ("the Rūnanga") and its subsidiaries (together "the Group") manage the cultural, social, political and economic base of the Ngāti Awa Iwi. The Rūnanga was incorporated under the Te Rūnanga o Ngāti Awa Act 1988, which was subject to the Māori Trust Board Act 1955. Under Section 5 of Te Rūnanga o Ngāti Awa Act 2005, the Rūnanga ceased to be a Māori Trust Board from 25 March 2005, but continues as the same body as established by the Te Rūnanga o Ngāti Awa Act 1988. The Rūnanga is domiciled in New Zealand. The address of the registered office is 10 Louvain Street, Whakatāne.

2 Summary of significant accounting policies

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated.

2.1 Basis of preparation

The Rūnanga is a registered charity under the Charities Act 2005 and its financial statements have been prepared in accordance with that Act, the Financial Reporting Act 2013 and as required by the Charter of Te Rūnanga o Ngāti Awa. The Rūnanga is a public benefit entity (“PBE”) for the purposes of financial reporting. A PBE is an entity whose primary objective is to provide goods or services for community or social benefit and where any equity has been provided with a view of supporting that primary objective rather than for a financial return to equity holders. The financial statements have been prepared in accordance with New Zealand Generally Accepted Accounting Practice (“NZ GAAP”). The financial statements comply with the PBE Standards Reduced Disclosure Regime (“PBE Standards RDR”) as appropriate for Tier 2 not-for-profit public benefit entities, for which reduced disclosure regime concessions have been applied. The Rūnanga qualifies for Tier 2 as it has total expenses less than $30 million and does not have public accountability. The presentation and functional currency is New Zealand Dollars (NZD). The measurement base applied is historical cost, as modified by the revaluation of certain assets and liabilities as identified in these accounting policies. The Group consists of the Rūnanga and its subsidiaries, associates and joint ventures as listed in note 25. The financial statements have been prepared on a going concern basis. Whilst the group has negative working capital balance as at 30 June 2021 this is due to a portion of the current banking facility ($3,200,000) having a maturity date of March 2022. The loan itself is secured over the property at Braemar road as disclosed within note 23. The group intends to renegotiate its banking facility during the 2021/2022 financial year and the directors believe that they will continue to have strong support of the bank. The directors have considered the current forecast trading of the group for a period of at least 12 months from the date these financial statements were signed, and the likelihood of continued bank support and are satisfied that the going concern basis is appropriate.

Basis of Preparing Consolidated Financial Statements Subsidiaries

Subsidiaries are those entities controlled, directly or indirectly, by the Rūnanga, that is, the Rūnanga has the power to govern the financial and operating policies of the entity so as to obtain benefits from their activities. The Rūnanga's consolidated subsidiary companies generally have an accompanying shareholding of more than one half of the voting rights. The Rūnanga's consolidated subsidiary trusts are where the Rūnanga appoints all the trustees of the trust and their activities are conducted on behalf of the Rūnanga. The results and financial position of subsidiaries are included in the consolidated statement of comprehensive revenue and expense and statement of financial position from the date control is gained up to the date control ceases. The financial statements of subsidiaries are included in the consolidated financial statements using the acquisition method. The consideration for the acquisition of a subsidiary is the fair values of the assets transferred, the liabilities incurred and the equity interest issued by the Rūnanga. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisition related costs are expensed as incurred. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. On an acquisition-by-acquisition basis, the Rūnanga recognises any non-controlling interest in the acquiree either at fair value or at the non-controlling interest's proportionate share of the acquiree's net assets. The surplus or deficit and each component of other comprehensive revenue and expense of subsidiaries are attributed to equity holders of the Rūnanga and to the non-controlling interests. Losses which result in non-controlling interests having a deficit balance are only attributed to non-controlling interests if the non-controlling interests have a binding obligation and are able to make an additional investment to cover the losses.

Associates

The Group recongnises the share of the net surplus of associates in the Statement of comprehensive revenue and expense. The investment held on the satement of financial position reflects the Group’s share of net asssets of the associate.

Joint Venture Receivables

The joint ventures are established by a contractual agreement. The Rūnanga’s share of the net surplus of the joint ventures is recognised in the statement of comprehensive revenue and expense. The investment held on the statement of financial position reflects the Rūnanga’s share of net assets of the joint venture.

Transactions Eliminated on Consolidation

The effects of intra-group transactions are eliminated in preparing the consolidated financial statements.

2.2 Revenue Exchange & Non‑Exchange Revenue

For exchange contracts, revenue is recognised to the extent that it is probable that the economic benefit will flow to The Rūnanga. Revenue is measured at the fair value of the consideration. The extent to which economic benefit is assessed is based on reaching milestones in the contract or matching revenue with total expenditure expected to be incurred. For non-exchange revenue, the revenue is recognised in surplus or deficit when the Rūnanga becomes entitled to receive (or has received) the funds. The receipts are recognised as revenue in surplus or deficit, except where conditions which require the grant to be used as specified or returned remain unfulfilled at balance date, in which case the related amount is recognised as a liability. In addition, a liability is recognised in respect of other return clauses (if any) where it is probable that payment will be required. Judgement is often required in determining the timing of revenue recongition for contracts that span a balance date and multi-year contracts.

Grant Income

Grant income (from the Government or other parties) are assessed against the criteria for non-exchange or exchange transactions and treated accordingly.

Dividend Income

Dividend income is recognised in surplus or deficit on the date the Group’s right to receive payment is established.

Farming Operations Income

Farming operations income includes dairy income and livestock sales. Income is recognised in surplus or deficit when the revenue associated with the transactions can be measured reliably. Revenues from the sale of goods are recognised when the significant risks and rewards of ownership have been transferred, the Group retains neither involvement nor control over the goods sold, it is probable that economic benefits will flow to the Group and the costs incurred in respect of the transaction can be measured reliably.

Rental Income

Rental income is recognised in surplus or deficit on a straight line basis over the term of the lease.

Other Income

Other income is recognised in surplus or deficit when the revenue associated with the transactions can be measured reliably for the rendering of goods and services. Revenue from the sale of goods are recognised when the significant risks and rewards of ownership have been transferred, the Group retains neither involvement nor control over the goods sold, it is probable that economic benefits will flow to the Group and the costs incurred in respect of the transaction can be measured reliably. Revenue for services provided under exchange transactions are recognised on a percentage of completion basis, as the services are provided.

Net Financing (Expense)/Income

Net financing income represents financing income less financing expenses. Financing income comprises interest income received on funds invested that are recognised in surplus or deficit. Financing expenses comprise interest paid on borrowings. Interest income is recognised in surplus or deficit as the income accrues on an effective interest basis. Any fees and directly related transaction costs that are an integral part of earning interest income are recognised over the expected life of the investment, that is, these costs are recognised evenly in proportion to the investment amount outstanding over the period to maturity.

2.3 Expenses Operating Leases

Operating lease payments where the lessor effectively retains substantially all the risks and rewards of ownership of the leased items are included in equal instalments over the term of the lease and expensed to surplus or deficit. Lease incentives received are recognised over the term of the lease as an integral part of the total lease payments.

Grants and sponsorships

Grants and sponsorship costs are recognised as an expense in surplus or deficit (and as a liability) when the Rūnanga has a constructive or actual obligation to make the payment. This is usually when the Rūnanga has entered into an agreement with, or otherwise notified the recipient of the agreed amount. The Rūnanga considers at each balance date whether it is probable that the recipient will be required to repay the grant or sponsorship under the terms and conditions of the agreement, in which case a receivable would be recognised and the grant expense reversed where this is recoverable.

2.4 Taxation Māori Authority Tax Credits

The Group has Māori Authority status. Entities in the Group are tax exempt except for Ngāti Awa Asset Holdings Limited which has a tax liability of 17.5%. Taxes paid by Ngāti Awa Asset Holdings Limited generate Māori Authority Credits, which are tax credits available to pass onto its shareholder. Te Rūnanga o Ngāti Awa recognises a tax receivable from the IRD for the Māori Authority Credits received from Ngāti Awa Asset Holdings Limited in the period in which the credits have been distributed.

Income Tax

Income tax is recognised in surplus or deficit as tax expense, except when it relates to items directly credited to equity, in which case it is recorded in equity, or where it arises from the initial accounting for a business combination, in which case it is included in the determination of goodwill. Current tax is the expected tax payable on taxable income for the period, based on tax rates (and tax laws) which are enacted or substantively enacted by the reporting date and including any adjustments for tax payable in previous periods. Current tax for current and prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable). Current tax assets and liabilities are offset only to the extent that they relate to income taxes imposed by the same taxation authority and there is a legal right and intention to settle on a net basis and it is allowed under tax law.

Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the consolidated statement of financial position differs from its tax base, except for differences arising on: - The initial recognition of goodwill - The initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the transaction affects neither accounting nor taxable profit, and - Investments in subsidiaries and jointly controlled entities where the Rūnanga is able to control the timing of the reversal of the difference and it is probable that the difference will not reverse in the foreseeable future. Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against which the difference can be utilised.

2.5 Cash and cash equivalents

Cash and cash equivalents includes deposits held at call with banks and other short term highly liquid investments with an original maturity of less than 3 months.

2.6 Trade and Other Receivables

Trade and other receivables are recognised initially at fair value and subsequently measured at amortised cost on an effective interest basis with any expected losses recognised from initial recognition of the receivables. Bad debts are written off during the year in which they are identified.

2.7 Biological assets and agricultural produce

(i) Livestock Livestock is carried at fair value where fair value is based on the market price of livestock of similar age and gender. Gains and losses on changes in fair value are recognised in surplus or deficit. Livestock consists of sheep and cattle.

(ii) Biological Assets

Farm Woodlot

The Farm Woodlot asset represents standing trees at fair value less estimated point of sale costs. The farm woodlot asset is a consumable biological asset. Any movement in valuation is recognised in surplus or deficit.

2.8 Investments

Investments are carried at fair value unless they are not quoted in an active market and their fair value cannot be reliably measured. The fair value of such investments is reliably measurable where the variability in the range for a reasonable fair value estimate is not significant or probabilities of the various estimates within the range of fair values can be reasonably assessed and used in estimating fair value.

2.9 Investment property

Investment properties are stated at fair value. Any movement on revaluation is recognised in surplus or deficit. Management test fair value annually with an independent assessment not more than five yearly intervals.

2.10 Forestry Land Assets

Forestry land assets represent the land assets owned with long term lease to forestry companies. Forestry land assets are stated at fair value. Any movement in fair value is recognised in surplus or deficit.

2.11 Intangible assets Carbon credits

Intangible assets include carbon credits acquired by way of a Government grant and are recognised at fair value. Increases in the carrying amount arising on revaluation are credited to other comprehensive revenue and expense except to the extent they reverse a previous decrease recognised in surplus or deficit. Decreases in the carrying amount arising on revaluation are recognised in other comprehensive revenue and expense to the extent they reverse a previous increase, any further decrease will be recognised in surplus or deficit.

Fish quota

Fish quota shares received by way of settlement are recognised at their fair value at the date of settlement and subsequently carried at cost less impairment. Fish quota is issued into perpetuity and therefore has an indefinite life. Given this, fish quota is not amortised, although it is tested annually for impairment.

Amortisation

Amortisation is recognised in the surplus or deficit on a straight-line basis over the estimated useful lives of intangible assets, other than goodwill, from the date that they are available for use.

2.12 Property, plant and equipment

All owned items of property, plant and equipment are recorded at cost less accumulated depreciation and impairment losses with the exception of the Ngāti Awa Farm which is recorded at deemed cost. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits or service potential associated with the item will flow to the Group and the cost of the item can be measured reliably.

Cultural Assets

The cultural assets category includes carvings and flax tukutuku, these assets have been recorded at deemed cost. Te Mānuka Tūtahi Marae is carried at an assigned value on receipt from the Crown plus capital improvements. As cultural assets tend to have an indefinite life and are generally not of a depreciable nature, depreciation is not applicable. (i) Depreciation The estimated useful lives for the current and comparative periods are as follows:

Class of asset depreciated Estimated useful life Buildings 40 years

Farm equipment 3-20 years

Office Furniture and equipment 3-10 years

Motor vehicles & vessels 3-15 years Cultural assets N/A Depreciation methods, useful lives and residual values are reassessed at every reporting date.

2.13 Financial Assets Financial instruments

A financial instrument is recognised if the Group becomes a party to the contractual provisions of the instrument. Financial assets are derecognised if the Group’s contractual rights to the cash flows from the financial assets expire or if the Group transfers the financial asset to another party without retaining control or substantially all risk and rewards of the asset. Regular way purchases and sales of financial assets are accounted for at trade date, i.e., the date that the Group commits itself to purchase or sell the asset. Financial liabilities are derecognised if the Group’s obligations specified in the contract expire or are discharged or cancelled. Financial instruments comprise trade and other receivables, cash and cash equivalents, loans and borrowings, and trade and other payables. Financial instruments are recognised initially at fair value plus transaction costs unless they are carried at fair value through profit or loss in which case the transaction costs are recognised in the profit or loss. The fair value of financial instruments traded in active markets (such as publicly traded derivatives, and trading and available-for-sale securities) is based on quoted market prices at balance date. The quoted market price used for financial assets held by the Group is the current bid price; the appropriate quoted market price for financial liabilities is the current ask price. The subsequent measurement of financial assets depends on their classification. The Group classifies financial assets into categories depending on their contractual cash flow characteristics and the Group’s business model for managing financial assets. The categories of financial assets are:

(i) Financial assets at amortised cost Assets that are held for collection of contractual cash flows where those cash flows represent solely payments of principal and interest are measured at amortised cost. Interest income from these financial assets is included in finance income using the effective interest rate method. Any gain or loss arising on derecognition is recognised directly in profit or loss and presented in other gains/(losses) together with foreign exchange gains and losses. Impairment losses are presented as a separate line item in the Statement of comprehensive revenue and expense. (ii) Financial assets at fair value through other comprehensive income (FVOCI) Assets that are held for collection of contractual cash flows and for selling the financial assets, where the assetsí cash flows represent solely payments of principal and interest, are measured at FVOCI. Movements in the carrying amount are taken through OCI, except for the recognition of impairment gains or losses, interest income and foreign exchange gains and losses which are recognised in profit or loss. When the financial asset is derecognised, the cumulative gain or loss previously recognised in OCI is reclassified from equity to profit or loss and recognised in other gains/(losses). Interest income from these financial assets is included in finance income using the effective interest rate method. Foreign exchange gains and losses are presented in other gains/(losses) and impairment expenses are presented as a separate line item in the Statement of comprehensive revenue and expense. (iii) Financial assets at fair value through Profit or Loss (FVPL) Assets that do not meet the criteria for amortised cost or FVOCI are measured at FVPL. A gain or loss on a debt investment that is subsequently measured at FVPL is recognised in profit or loss and presented net within other gains/(losses) in the period in which it arises.

Financial Liabilities

The Group’s financial liabilities include trade and other payables, loans and borrowings. The Group classifies its financial liabilities as financial liabilities at amortised cost. The classification of financial liabilities is determined on initial recognition. All financial liabilities are recognised initially at fair value, and in the case of loans and borrowings, include directly attributable transaction costs. All financial liabilities of the Group are subsequently measured at amortised cost. Interest expense and foreign exchange gains and losses are recognised in profit or loss. Any gain or loss on derecognition is also recognised in profit loss.

Impairment of receivables

The Group assesses, on a forward-looking basis, the expected credit losses associated with its financial assets carried at amortised cost and FVOCI. The impairment methodology applied depends on whether there has been a significant increase in credit risk. For trade receivables, the Group applies the simplified approach permitted by PBE IPSA 41, which requires expected lifetime losses to be recognised from initial recognition of the receivables. The recoverable amount of the Group’s investments in receivables carried at amortised cost is calculated as the present value of estimated future cash flows. Impairment losses on an individual basis are determined by an evaluation of the exposures on an instrument by instrument basis. All individual instruments that are considered significant are subject to this approach.

2.14 Impairment of Non‑financial Assets

The carrying amounts of the Group’s non-financial assets are reviewed at each balance date to determine whether there is any indication of impairment. If any such indication exists, the recoverable amount or recoverable service amount (“recoverable amount”) of the asset is estimated. If the estimated recoverable amount of an asset is less than its carrying amount, the asset is written down to its estimated recoverable amount and an impairment loss is recognised in the statement of comprehensive revenue and expense in surplus or deficit. The estimated recoverable amount of assets is the greater of their fair value less costs to sell and value in use.