BREWIN TRUST FUND
Report on the Brewin Trust Fund Committee
on the Administration of the Fund
for the year ended 30 June 2007
During the year under report, the composition of the Brewin Trust Fund Committee (the Committee), constituted under Section 5 of the Brewin Trust Fund Ordinance (Chapter1077), was as follows –
Secretary for Home Affairs (Chairman and ex-officio)
Director of Social Welfare
Commissioner for Labour
Chairman, Board of Directors, Po Leung Kuk –
(Mrs Louise MON KOO) (up to 31.3.2007))
(Mrs LAU CHAN Siu-po, Angel) (as from 1.4.2007)
Ms YU Sau-chu, MH
Mr FONG Man-hung, David (as from 13.11.2006)
Mr LEE Kwan-ho, Vincent Marshall (as from 13.11.2006)
Mr PAK Fu-hung, Frank (as from 13.11.2006)
2. The purpose of the Brewin Trust Fund (the Fund) is to provide financial assistance for the maintenance and benefit of –
(a) / widows, widowers and orphans who, being residents in Hong Kong, appear to the Committee to require such maintenance and benefit; and(b) / workmen, which expression shall include females, who having been employed in Hong Kong and become wholly or in part incapacitated for work by reason of age, sickness, disablement or otherwise, appear to the Committee to require such maintenance and benefit.
3. The secretarial and accounting work of the Fund was provided by the Trust Funds, Temples and Cemeteries Joint Secretariat. The Director of Audit was the Auditor of the Fund’s account.
4. A copy of the audited Financial Statements for the year ended 30 June 2007 is at the Appendix.
/The total…
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5. The total expenditure for the year under report amounted to HK$3,795,988, of which HK$3,436,575 was spent on grants and HK$233,292 was spent on the administration cost. The major breakdown on grants is as follows –
HK$(a) / Grants through the Director of Social Welfare to individuals and families in need of immediate financial assistance. / 1,245,126
(b) / Grants through the Commissioner for Labour to –
(i) / Needy family members of deceased employees in fatal employees compensation cases. / 780,000
(ii) / Employees, or family members of deceased employees, who are incapacitated or die due to work-related diseases (other than pneumoconiosis and occupational deafness) but are not eligible for compensation under the Employees’ Compensation Ordinance. / -
(iii) / Family members of deceased pneumoconiotics who are not eligible for any compensation under the Pneumoconiosis (Compensation) Ordinance or any benefits under the Pneumoconiosis Ex Gratia Scheme. / 560,000
(iv) / Employees who have been dismissed or forced to resign due to old age or sickness before they qualify for long service payment and are not entitled to remedies under Part VIA of the Employment Ordinance. / )
)
)
)
) / 36,320
(v) / Employees who are unable to receive long service payment or terminal payment under Part VIA of the Employment Ordinance by default of their employers. / )
)
)
(vi) / Elderly employees who are dismissed due to redundancy within 6 months before qualifying for severance payment. / -
(vii) / Elderly employees who are unable to receive severance payment by default of their employers and have been time-barred to apply ex-gratia payment under the Protection of Wages on Insolvency Ordinance. / -
(viii) / Employees who are certified as permanently unfit to continue with their work and are unable to receive long service payment by default of their employers. / 55,129
/Employees…
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(ix) / Employees suffering from noise-induced deafness by reason of their employment in specified noisy occupations but are not eligible for compensation under the Occupational Deafness (Compensation) Ordinance because of, despite meeting the occupational requirement and the hearing loss requirement in one of the ears, failing to satisfy the minimum hearing loss requirement in the other ear. / 20,000
(x) / Family members of persons who died in work accidents and are alleged to be self-employed. / 40,000
(xi) / Employees suffering from mesothelioma or family members of persons who die as a result of mesothelioma and are unable to receive compensation on damages. / 700,000
______
Total : / 3,436,575
======
(Tsang Tak-sing)
Secretary for Home Affairs
Chairman
Brewin Trust Fund Committee
5 December 2007
Appendix
BREWIN TRUST FUND
BALANCE SHEET AS AT 30 JUNE 2007
Note / 2007 / 2006HK$ / HK$
NON-CURRENT ASSETS
Available-for-sale financial assets / 4 / 194,603,887 / 168,261,607------/ ------
CURRENT ASSETS
Accounts receivable / 1,929,715 / 2,223,357
Time deposits / 30,999,812 / 40,007,024
Cash at banks / 1,091,786 / 1,327,783
34,021,313 / 43,558,164
CURRENT LIABILITIES
Provision for staff gratuity / 5 / 21,536 / 15,678
Provision for untaken leave / 4,974 / 3,061
Accounts payable / 40,070 / 24,386
66,580 / 43,125
______/ ______
NET CURRENT ASSETS / 33,954,733 / 43,515,039
------/ ------
TOTAL NET ASSETS / 228,558,620 / 211,776,646
======/ ======
ACCUMULATED FUND
Capital reserve / 60,000,000 / 60,000,000
Accumulated surplus / 45,779,860 / 41,123,037
Investment revaluation reserve / 122,778,760 / 110,653,609
______/ ______
228,558,620 / 211,776,646
======/ ======
The accompanying notes 1 to 6 form part of these financial statements.
(Tsang Tak-sing)
Secretary for Home Affairs Incorporated
Trustee
Brewin Trust Fund
5 December 2007
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BREWIN TRUST FUND
INCOME AND EXPENDITURE ACCOUNT
FOR THE YEAR ENDED 30 JUNE 2007
Note / 2007 / 2006HK$ / HK$
INCOME
Dividends / 5,876,240 / 5,715,371
Interest / 6 / 2,566,229 / 1,561,025
Gains on disposal of available-for-sale
financial assets / - / 19,228,814
Exchange gains / 2,342 / -
Refund of grants / 8,000 / -
8,452,811 / 26,505,210
EXPENDITURE
Grants / 3,436,575 / 4,182,289
Staff costs / 233,292 / 242,516
Losses on disposal of available-for-sale
financial assets / 126,121 / -
Exchange losses / - / 346
3,795,988 / 4,425,151
______/ ______
SURPLUS FOR THE YEAR / 4,656,823 / 22,080,059
======/ ======
The accompanying notes 1 to 6 form part of these financial statements.
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BREWIN TRUST FUND
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2007
CapitalReserve
HK$ / Accumulated Surplus
HK$ / Investment Revaluation Reserve
HK$ / Total
HK$
Balance at 1 July 2005 / - / 79,042,978 / 116,681,917 / 195,724,895
Transfer / 60,000,000 / (60,000,000) / - / -
Net fair value gains on available-for-sale
financial assets / - / - / 9,462,081 / 9,462,081
Net fair value gains transferred to
income and expenditure account
on disposal / - / - / (15,490,389) / (15,490,389)
Surplus for the year 2005-06 / - / 22,080,059 / - / 22,080,059
______/ ______/ ______/ ______
Balance at 1 July 2006 / 60,000,000 / 41,123,037 / 110,653,609 / 211,776,646
Net fair value gains on available-for-sale
financial assets / - / - / 11,881,915 / 11,881,915
Net fair value losses transferred to
income and expenditure account
on disposal / - / - / 243,236 / 243,236
Surplus for the year 2006-07 / - / 4,656,823 / - / 4,656,823
______/ ______/ ______/ ______
Balance at 30 June 2007 / 60,000,000 / 45,779,860 / 122,778,760 / 228,558,620
======/ ======/ ======/ ======
The accompanying notes 1 to 6 form part of these financial statements.
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BREWIN TRUST FUNDCASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE 2007
2007 / 2006
HK$ / HK$
CASH FLOWS FROM OPERATING ACTIVITIES
Surplus for the year / 4,656,823 / 22,080,059
Dividend income / (5,876,240) / (5,715,371)
Interest income / (2,566,229) / (1,561,025)
Loss/(Gain) on disposal of available-for-sale financial assets / 126,121 / (19,228,814)
Decrease/(Increase) in accounts receivable / 226,720 / (1,008,582)
Increase in provision for staff gratuity / 5,858 / 13,259
Increase in provision for untaken leave / 1,913 / 2,148
Increase in accounts payable / 15,684 / 20,462
NET CASH USED IN OPERATING ACTIVITIES / (3,409,350) / (5,397,864)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of available-for-sale financial assets / (29,742,000) / (9,716,670)
Sale proceeds from disposal of available-for-sale financial
assets / 15,398,750 / 27,578,424
Dividends received / 5,799,768 / 5,679,077
Interest received / 2,709,623 / 1,339,006
NET CASH (USED IN)/FROM INVESTING ACTIVITIES / (5,833,859) / 24,879,837
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS / (9,243,209) / 19,481,973
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR / 41,334,807 / 21,852,834
CASH AND CASH EQUIVALENTS AT END OF YEAR / 32,091,598 / 41,334,807
ANALYSIS OF THE BALANCES OF CASH AND CASH
EQUIVALENTS
Time deposits with original maturity within three months / 30,999,812 / 40,007,024
Cash at banks / 1,091,786 / 1,327,783
32,091,598 / 41,334,807
The accompanying notes 1 to 6 form part of these financial statements.
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BREWIN TRUST FUND
NOTES TO THE FINANCIAL STATEMENTS
1. GENERAL
The financial statements of the Brewin Trust Fund (the Fund) are prepared in accordance with section 10(1) of the Brewin Trust Fund Ordinance (Cap. 1077). The Fund provides assistance for:
(a) the maintenance and benefit of widows, widowers and orphans who, being resident in Hong Kong, appear to the Brewin Trust Fund Committee (the Committee) to require such maintenance and benefit; and
(b) the maintenance and benefit of workmen, which expression shall include females, who having been employed in Hong Kong and become wholly or in part incapacitated for work by reason of age, sickness, disablement or otherwise, appear to the Committee to require such maintenance and benefit,
in accordance with section 4 of the Brewin Trust Fund Ordinance.
The address of the Fund’s principal place of business is 34th Floor, Wu Chung House, 213Queen’s Road East, Wan Chai, Hong Kong.
2. SIGNIFICANT ACCOUNTING POLICIES
(a) Statement of compliance
The financial statements have been prepared in accordance with applicable Hong Kong Financial Reporting Standards (HKFRSs) issued by the Hong Kong Institute of Certified Public Accountants and accounting principles generally accepted in Hong Kong.
(b) Basis of preparation
The financial statements have been prepared on an accrual basis and under the historical cost convention except that available-for-sale financial assets are stated at fair value as explained in the accounting policy set out in note 2(d) below.
(c) Adoption of new/revised HKFRSs
The Fund has adopted all new/revised HKFRSs which are effective and relevant to the Fund for the current accounting period.
The Fund has not early applied any HKFRS that is not yet effective for the current accounting period. The Fund has considered that these HKFRSs may not have a significant impact on its results of operations and financial position.
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(d) Available-for-sale financial assets
The Fund’s available-for-sale financial assets are classified as non-current assets unless the Committee intends to dispose of the investments within 12 months of the balance sheet date.
Purchases and sales of investments are recognised on trade-date on which the Fund is committed to the transactions. Available-for-sale financial assets are initially recognised at fair value plus transaction costs. At each balance sheet date, the fair value is re-measured and any unrealised holding gain or loss arising from the change in fair value is included in the investment revaluation reserve.
When available-for-sale financial assets are sold, the gains or losses from the investments are dealt with in the income and expenditure account.
The fair values of quoted investments are based on current bid-prices.
The Fund assesses at each balance sheet date whether there is objective evidence that a financial asset is impaired. The cumulative loss – measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in the income and expenditure account – is removed from the investment revaluation reserve and recognised in the income and expenditure account. Such impairment losses are reversed if the subsequent increase in fair value can be objectively related to an event occurring after the impairment loss was recognised. Reversals of impairment losses for debt securities are recognised in the income and expenditure account. Reversals of impairment losses for equity securities are recognised directly in the investment revaluation reserve.
(e) Foreign currency translation
Hong Kong dollar is the currency of the primary economic environment in which the Fund operates. Foreign currency transactions during the year are translated into Hong Kong dollars at the exchange rates ruling at the transaction dates. Monetary assets and liabilities denominated in foreign currencies are translated into Hong Kong dollars at the exchange rates ruling at the balance sheet date. Exchange gains and losses are dealt with in the income and expenditure account.
(f) Revenue recognition
Interest income is recognised on an accrual basis. Dividend income is recognised when the Fund’s right to receive payment is established.
(g) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, demand deposits, and other short-term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of changes in value, having been within three months of maturity when acquired.
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3. RISK MANAGEMENT
The Fund’s major financial instruments include available-for-sale financial assets, bank deposits, cash, receivables and payables. The main risks associated with these financial instruments are market risk, credit risk and liquidity risk. Market risk is the risk that changes in market variables such as interest rates, equity prices and exchange rates may affect the fair value or cash flows of a financial instrument. Credit risk is the risk that one party to a financial instrument will fail to discharge an obligation and cause the other party to incur a financial loss. To minimize the potential adverse effects of such risks, the investment portfolio of the Fund is kept under review by the Committee on a continual basis. For investment in debt securities, only those classified as grade A3 or grade A- or above are considered. All time deposits are placed with reputable licensed banks in Hong Kong. In the management of liquidity risk, the Fund maintains the level of cash and cash equivalents that is considered adequate to finance its operations and mitigate the effects of fluctuations in cash flows.
2007HK$ / 2006
HK$
4. AVAILABLE-FOR-SALE FINANCIAL ASSETS
Equity Securities
Listed in Hong Kong / 155,223,147 / 143,354,019
Debt Securities
Unlisted / 29,441,875 / -
Listed in Hong Kong / 5,009,000 / 13,880,550
Listed outside Hong Kong / 4,929,865 / 11,027,038
39,380,740 / 24,907,588
______/ ______
Fair value as at 30 June 2007 / 194,603,887 / 168,261,607
======/ ======
5. PROVISION FOR STAFF GRATUITY
Balance at 1 July 2006 / 15,678 / 2,419
Provision for the year / 17,790 / 22,155
Payment for the year / (11,932) / (8,896)
______/ ______
Balance at 30 June 2007 / 21,536 / 15,678
===== / =====
6. INTEREST
Interest on bank deposits / 1,672,560 / 776,687
Interest on bonds / 893,669 / 784,338
2,566,229 / 1,561,025
======/ ======
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