Dated at Wellington this 22nd day of August 2006.
The Common Seal of the Securities Commission was affixed in the presence of:
Statement of reasons
This notice, which comes into force on the day after the date of its notification in the Gazette and expires on 30 June 2008, exempts superannuation trustees from clause 5(3)(a)(iii) of Schedule 3C of the Securities Regulations 1983 (the Regulations), in respect of interests in a superannuation scheme of which the superannuation trustee is the issuer. Clause 5(3)(a)(iii) of Schedule 3C requires a registered prospectus for a superannuation scheme to contain a financial statement in summary form for the scheme. That statement must include the amount of net gains or losses on investments, distinguishing between realised and unrealised.
The exemption is granted on the condition that a registered prospectus relating to interests in a superannuation scheme contains, in the summary financial statement, the amounts of the aggregate change in the value of investments. Those amounts must be the amounts that appear in financial statements that comply with Financial Reporting Standard No 32 or New Zealand Equivalent to International Accounting Standard 26.
The effect of the exemption is that it is not necessary for the summary financial statement included in the registered prospectus for a superannuation scheme to distinguish between realised and unrealised changes in value of investments.
The Securities Commission considers that it is appropriate to grant the exemption for the following reasons:
under generally accepted accounting practice, superannuation schemes can report realised and unrealised changes in the value of investments as an aggregated figure. However, under the Regulations this figure must distinguish between realised and unrealised amounts:
because of this, superannuation schemes must incur extra costs to comply with the Regulations. These costs appear to outweigh the benefits of such disclosure:
to address the above matters, this notice exempts superannuation trustees from the requirements of the Regulations and allows them to present this financial information in their prospectuses in accordance with generally accepted accounting practice.