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The University of Auckland Foundation ANNUAL REPORT | 2007

ANNUAL REPORT | 2007 ThE UNivERsiTy Of AUckLANd fOUNdATiON

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CONTENTs

Report from the chair 1

distributions Made 2

Gifts Received 6

investments 10

friends of The University of Auckland 11

financial statements 12

TOP ROw fROm LEfT:

mr Hugh fletcher, mr Tim Greville (Foundation Secretary), mr Peter Hays, Professor stuart mcCutcheon, Dr John matthews

bOTTOm ROw fROm LEfT:

Dr Ian Parton, mr Geoff Ricketts, Dr Richard sorrenson (Foundation Manager), mr John Taylor (Director of External Relations), Dr Don Turkington

mIssION sTATEmENTTo support the advancement of knowledge and learning at The University of Auckland.

DIRECTORY

Trusteesmr Geoff Ricketts (Chair)mr Peter Hays (Chair, Audit Committee)mr Hugh fletcherProfessor stuart mcCutcheonDr John matthewsDr Ian PartonDr Don Turkington (Chair, Investment Committee)

AuditorswHK Gosling Chapman Partnership, Auckland

solicitorsbrookfields, Auckland

Bankersbank of New Zealand, Queen st, Auckland

investment consultantsmercer IC, Auckland

Address for correspondenceDr Richard sorrensonfoundation managerExternal Relations, The University of Auckland Private bag 92019, Auckland 1142New Zealand

Phone 64 9 373 7488fax 64 9 373 8766Email [email protected]

On the cover Alumni Scholars with Foundation Trustees Dr Don Turkington and Mr Geoff Ricketts Registered with the NZ Charities Commission, no. CC10985

Report from the Chair 2007

The foundation’s mission is to “support the advancement of knowledge and learning at The University of Auckland” and 2007 saw another record year with gifts received of $14,589,531 and distributions made of $2,192,881.

The foundation relies upon all its donors to carry out its mission. As this Report is being sent out to every donor of record in the past five years, I would like to take this opportunity to convey my sincere appreciation to each and every one of them. In 2007, a landmark gift from an anonymous donor of $4.5 million led the way. The foundation was also very pleased to receive an endowment gift of $1.7 million from the bedogni family to sustain open systems research in computer science, in memory of Clinton bedogni, who was himself a talented computer scientist. Owen Glenn’s continued support of the University was evidenced by a $1.5 million pledge payment towards the business school. finally, among major gifts, the Asb Charitable Trust made a pledge of $1 million to the starpath educational research project that will be very important to strengthening the University’s commitment to equitable educational outcomes. All of these gifts benefit not only the University, but also the Nation.

During 2007, the foundation made distributions to a wide range of activities, in accordance with the original donors’ wishes: to The University of Auckland business school and its entrepreneurship, leadership, logistics & supply management, and energy economics programmes; to the Hood fellows, who have done much to strengthen the University’s international reputation; and to a variety of scholarships, granted on the basis of need, to enable students to attend the University.

Also in 2007, the foundation made the very important decision to split its funds into endowment and current use investment pools, containing short-term and long-term funds respectively, and committed itself to a new endowment investment asset allocation in 2008 that is designed to protect the capital value of endowment gifts while also providing regular and inflation-protected annual income to The University of Auckland.

On April 1, 2008, the most important change for many decades in the philanthropic sector occurred, with the very generous rebates now available on gifts to any charity, including, of course, the foundation. Any cash gift made from 1 April 2008 onwards, regardless of its source, can be offset against the entire net income of donor and earn a 331/3 percent rebate. for example, if a donor’s net income is $60,000 p.a. and the donor gives a gift of $60,000 from savings or the proceeds of selling an asset, he or she will receive a $20,000 rebate from the IRD.

finally, I want to recognise Anna Nathan for her service as a Trustee from 2002, to welcome her replacement, Dr Ian Parton, an Engineering alumnus, and to thank all my fellow Trustees and the staff members that serve the foundation.

Geoff RickettsChair, board of Trustees

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A distribution of $164,471 (original donor: fletcher building Employee Educational fund) was made in support of the fletcher building Education Trust Chair in Leadership, New Zealand’s first full chair in Leadership, held by Professor brad Jackson.

Professor Jackson is charged with leading the academic development and integration of research and educational programmes in leadership at The University of Auckland in order to cement the University’s reputation as the country’s preeminent institution in which to study leadership.

ANNUAL REPORT | 2007

CHAIR IN ENTREPRENEURsHIP

A distribution of $330,000 (original donor: anonymous) was made to support the Chair in Entrepreneurship, held by Professor wendell Dunn.

An expert on venturing and entrepreneurship education, Professor Dunn was instrumental in establishing the University’s interfaculty masters in

bioscience Enterprise programme, cited as a “best practice” in biotechnology education.

During 2007 he developed and co-taught four new postgraduate professional courses and served again as head of the “Vision-to-business” course of the “spark” programme, a student-led initiative established in 2003 to foster the growth of an entrepreneurial culture within the University.

In addition to meeting with numerous industry and institutional leaders, his outreach activities in 2007 included presentations in Taiwan and Korea and continuing service on the Growth and Innovation Advisory board which advises the Prime minister and the Cabinet on New Zealand’s economic direction.

Professor Dunn is the business school’s Associate Dean for Academic Development, and serves on the editorial boards of Elsevier science’s Journal of Business Venturing and The University of Auckland Business Review.

Distributions MadeThe Foundation made distributions of $2,192,881 in 2007 for research, teaching, fellowships, programmes and scholarships. These supported a wide range of recipients, from talented young University entrants through to esteemed academics whose work is affecting the future of New Zealand. Equally, they assisted in furthering research for the benefit of particular communities which may ultimately benefit the whole country.

Building New Zealand’s capacity to create wealthAmong the most substantial distributions were those that support the development of innovative ideas and solutions to enable a vibrant and thriving economy. As part of its goal of making an increasingly significant contribution to New Zealand’s capacity to create wealth, The University of Auckland business school is committed to attracting and retaining a diverse faculty of recognised scholars. The foundation’s support enables the business school to build on existing disciplinary strengths and expand into new areas of development.

fLETCHER bUILDING EDUCATION TRUsT CHAIR IN LEADERsHIP

Professor wendell Dunn

Professor brad Jackson

Ports of Auckland managing Director Jens madsen (left) with business school Ports of Auckland Chair Professor Alan stenger.

PORTs Of AUCKLAND CHAIR IN LOGIsTICs AND sUPPLY CHAIN mANAGEmENT

A distribution of $183,649 (original donor: Ports of Auckland) was made to support the Ports of Auckland Chair in Logistics and supply Chain management. Held by Professor Alan stenger, the Chair was established to combine academic knowledge and insight with commercial knowledge, practice and experience.

During 2007, Professor stenger focused on building relationships with industry and governmental organisations in New Zealand which are stakeholders in supply chains. In October, the business school formally launched the Centre for supply Chain management, with five charter organisational members. supported by annual donations from these stakeholders, the Centre’s purpose is to develop and disseminate world-class knowledge and practices, applicable to Australasian economies in general and New Zealand in particular. The Centre does this by fostering cooperation, collaboration, and communication between academic researchers and industry practitioners for the purpose of research, education, and the interchange of ideas. As part of its role in improving supply chain practice, the Centre and Ohio state University jointly sponsored a five-day course on strategic supply Chain management for New Zealand executives.

Professor stenger was also active in research, presenting papers at two international conferences and publishing a case study on corporate responsibility in supply chains. He gave numerous talks on supply chain management and he continued leading the development of the undergraduate, postgraduate and mbA curricula in supply chain management. Two PhD students and several masters-level students are currently studying in the area, along with approximately 30 undergraduates.

To this end, he introduced a new postgraduate course in leadership that attracted 24 students, of which seven have gone on to pursue masters and doctoral studies in leadership. Professor Jackson also completed A Very Short, Fairly Interesting and Reasonably Cheap Book About Studying Leadership, aimed at senior undergraduate and postgraduate students. In addition, he was invited to co-edit sage’s Handbook of Leadership and to co-edit a special issue of the journa Leadership. During 2007 he gave more than 50 presentations on leadership to groups external to the University throughout New Zealand. finally, The University of Auckland was asked to host the seventh International Conference of studying Leadership, to be held in December 2008. This will be the first time this prestigious Conference has been held outside the United Kingdom.


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A distribution of $186,910 (original donor: Lion foundation) was made to the Lion foundation Hood fellowships, which were established in 2004 in recognition of former Vice-Chancellor John Hood’s contribution to the University.

The purpose of the fellowships is to maintain and enhance the international standing and performance of The University of Auckland by attracting distinguished overseas academics, by developing and retaining the University’s best academic staff, by hosting recognised international experts for guest lectures and seminars at the University and by building stronger international networks among its community of scholars.

Promoting success for all our children Grants aimed at enhancing the lives of young New Zealanders by removing barriers to success and supporting educational achievement were a key focus of the 2007 foundation distributions. Encouraging children to succeed, first in school and then in the tertiary system, provides pathways towards healthy, productive lives, with positive implications for New Zealand’s long-term social and economic development.

Shaping New Zealand’s energy future

Attracting and developing esteemed academics

THE ENERGY CENTRE

A distribution of $387,609 (original donors: The Energy Education Trust of New Zealand; Genesis Energy; solid Energy; and Vector) was made to the Energy Centre, a think tank within the business school. Professor John Panzar was appointed Chair in July 2007.

The Centre aims to provide an independent perspective and an open forum for discussions on energy security, reliability and cost, climate change issues and the forward sustainability pathway for New Zealand. because it is firmly grounded in the business school and it is also strongly tied to the faculty of Engineering, the Energy Centre focuses both on the economic aspects of its work as well as the technology. An important aspect of the Centre’s work is stimulating debate on energy issues among industry representatives, politicians and academics.

sTARPATH: PROJECT fOR PARTICIPATION AND sUCCEss

A research grant of $200,000 (original donor Asb Charitable Trust) was made to starpath, a Partnership for Excellence between The University of Auckland and the Tertiary Education Commission.

starpath is a collaborative initiative aimed at transforming educational opportunities for those groups of students currently underrepresented in higher education, specifically, māori and Pacific students and those from low-decile schools. working with primary and secondary schools and tertiary partners, the project aims to set students who are underachieving on “pathways to success”, allowing them to fulfil their potential.

During 2007 a partner school and five additional participating schools were established in the Northland region and academic advisory groups for all starpath projects were set up. Other highlights included conducting interviews for two qualitative projects, one aimed at finding out why and how māori and Pacific students make NCEA course choices and the other aimed at exploring the transition process from secondary to tertiary education. Progress on quantitative work included designing a detailed protocol for data organisation and investigating the impact of various NCEA and University Entrance criteria.

Hood fellows (from left): Reinhard Klette; stephen Davies; Janie sheridan; and Diana Lennon at a reception with marston Conder, held at University House in August.

Professor stuart mcNaughton

Highlights for 2007 included the “Powering Our future” symposium, cohosted with the woodrow wilson Centre; organising an academic workshop on hydro versus thermal-dominated electricity systems; organising the “Transitional measure bridging forum”; and co-organising, with the New Zealand Centre for Advanced Engineering, the “sustainability forum”, attended by senior business leaders. In addition, the basis was laid for graduate and undergraduate courses in Energy Economics to start in 2009.

Three University of Auckland academics were awarded Hood fellowships in 2007: Professor Diana Lennon; Professor Reinhard Klette, and Professor bill barton, each supported to take up opportunities for overseas research and collaboration.

Nine incoming recipients – esteemed academics from a wide variety of fields – were announced in 2007. In addition, the University community was enriched by visits from recipients of several Hood fellowships announced in 2006.

wOOLf fIsHER REsEARCH CENTRE

A distribution of $150,000 (original donor: woolf fisher Trust) was made to the woolf fisher Research Centre, established in 1998 to promote research-based educational interventions in south Auckland, with a particular emphasis on Māori and Pacific children’s educational achievement.

In 2007 the woolf fisher Research Centre led by Professor stuart mcNaughton continued a research and development partnership with a cluster of decile one schools in mangere, with the overall aim of understanding how to raise achievement to national levels. funding from the woolf fisher Trust enabled the Centre to shift focus in 2007 from reading comprehension to writing achievement. Accelerated gains in reading had occurred over three years and the Centre is attempting to replicate and extend these findings in writing. The three-year study tests specific hypotheses about the most effective form of professional development to increase teachers’ curriculum and content knowledge so that gains in writing achievement occur and students’ learning generalises across different types of writing. findings from the first year suggest that the research and development process has been successful in accelerating achievement for the 9- to 13-year-olds (around 1500 in 50 classrooms) and that the Centre can identify the optimal instructional conditions to enable children to generalise these gains.


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Gifts ReceivedCelebrating the generosity of our donors Substantial donations from several individuals and families – including an anonymous gift of $4.5 million – featured strongly in the gifts to the Foundation in 2007. The generosity of those benefactors, the ASB Charitable Trust, and others, will support projects in a broad range of areas.

JOHN AND KENDA bEDOGNI

A gift of $1.7 million was made to the Computer science Department by John bedogni, a former co-owner of metropolitan Glass, and his wife, Kenda, in memory of their eldest son, Clinton.

The gift comprises two endowment funds: the larger, of $1.6 million, supports in perpetuity an annual Clinton bedogni fellowship in Open systems Research; the second, of $100,000, supports a biennial $10,000 Clinton bedogni Prize, to be awarded for the first time in 2008. It is envisaged that the fellowship will support a succession of early-career researchers deemed likely to become leaders in the field of Open software research, while the prize will go to the New Zealand individual – whether an academic or in industry – who has made the greatest contribution to the field of Open software systems in the previous two years.

Open software systems are computer programs that people can access, understand, contribute to and even adapt. At the time of his death in a car crash in June 2005, Clinton bedogni had developed a strong interest and capability in the Linux operating system, one of the best-known examples of Open software.

OwEN G GLENN

A pledge payment of $1.5 million was received from Owen G Glenn, as part of his generous support of The University of Auckland business school. In what is believed to be the largest private donation in the history of New Zealand education, mr Glenn pledged $7.5 million to the business school in 2002.

by the end of 2007, the business school’s new purpose-built and architecturally-designed home – the 74,000 square metre Owen G Glenn building complex – had neared completion. The new complex dominates the Grafton Road side of the City Campus and commands views of the Auckland Port, Rangitoto and the Auckland Domain. The Owen G Glenn building is architecturally striking, with the internal Asb Atrium scaling seven storeys and suspended social bridges connecting the upper levels. It provides a space where staff, students, alumni and members of the business community may feel at home, share opportunities and maximise linkages, contacts and collaborations.

The construction of the Owen G Glenn building, which contains the outstanding facilities and technologies necessary to create an exceptional learning environment, is a milestone in the University’s campaign to build a world-class business school for New Zealand. Investing in talented academic faculty and professional staff and offering relevant and challenging programmes for students and graduates are equally pivotal to the project.

Asb CHARITAbLE TRUsT

A pledge payment of $200,000 was made by the Asb Charitable Trust, which is a major supporter of starpath, having last year committed $1 million, at $200,000 per year. (see page 5)

RObERT LEITL

A gift of $700,000 was made by the Leitl Estate in June 2007 to create the Robert Leitl Chair in Optometry, in memory of one of the country’s pioneering optics manufacturers.

German-born Robert Leitl, who died in 1997, was a key figure in establishing the optics industry in New Zealand. He came to New Zealand in 1969 at the invitation of the government’s Trade and Industries Department to set up the first frame manufacturing plant for solavoid. He then helped to establish another frame manufacturing plant, Owen Optical, which he purchased in 1976. Over the next few years he continued to prosper and when the New Zealand Vision Research foundation was established in the 1980s, Leitl became a major benefactor.

The inaugural Robert Leitl Professor of Optometry is michael Kalloniatis, who heads the Optometry Department’s Retinal Networks Laboratory. The core focus of his research is to better understand why the retina degenerates in the group of genetic eye conditions called Retinitis pigmentosa with the aim of slowing down the advance of the disease.

As well as research and teaching, the Department of Optometry and Vision science operates eye clinics at both the Tamaki and Grafton campuses and is involved in a move to establish a multidisciplinary National Eye Research and Clinical Centre at the University.

back left to right: stuart mcCutcheon (Vice-Chancellor) and michael Davies (Dean, Engineering) front Left to right: Hugh fetcher (Chancellor), Des mataga (President AUEA), Geoff Ricketts (foundation Chair) and bruce Goodfellow (AUEA Charitable Trust)

THE AUCKLAND UNIVERsITY ENGINEERING AssOCIATION (AUEA) ENDOwmENT fUND

The foundation was very pleased to create the AUEA Endowment fund, which will accept endowment gifts to support the faculty of Engineering, particularly gifts from the AUEA Charitable Trust. Distributions from the fund will be overseen by the AUEA Endowment fund subcommittee of The University of Auckland foundation. members are sir Ron Carter ; Professor michael Davies; Dr Ian Parton; Dr bruce Goodfellow, Dr Richard sorrenson, and mr John Taylor. The fund is controlled by a Deed of Gift signed by the AUEA Charitable Trust, The University of Auckland, and the foundation.

John and Kenda bedogni


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Anonymous (14),

barlow, Adelaide

maxwell, Alan

burry, Alistair

Dunlop, Alistair

Orr, Andrew

Penniket, Andrew

scott, Andy

Ashley wilson, Angela

Auton, Leigh

bacarji, Elena

barber, mark

barfoot, Nicholas

barlow, sarah

bellringer, brian

black, Ian

blaschke, Anthony

braae, michael

brady, Derek

bryant, Doreen

Callander, stephen

Cato, bruce

Caughey, Christine

Chambers, Roger

Cheang, Gerald

Chew, Robert

Christianson, muriel

Colville, Jan

Crawford, Janet

Darlow, bob

Davies, Glyndwr

Dennehy, bernard

Difiore, Elizabeth

Dowrick, David

Dunn, Gregor

Edwards, Graeme

fairburn, Hanno

falkenstein, Tony & Heather

fenelon, Louis

ferguson, George

fitzsimons, Peter

fox, James

fuimaono, samuel

Ghai, Yash

Gibbs, Jenny

Glenn, Owen

Graham, Grant

Green, Roger

Gribben, Trish

Haddon, Raymond

Hadlow, simon

Hall, Graham

Hall, Robert

Hand, Rodney

Heywood, Jean

Hoben, sam

Hudson, switzer

Hughes, susan

Hunt, Jonathan

Hunter, Peter

Hutchison, David

Jackson, Peter

Kearney, mary-Louise

Keen, Rebecca

Kelderman, maatje

Kwee, Constance

La Roche, John

Lam, Patrick

Law, wan

Leak, martin

Lee, Kok Ying

Lian, bee Leng

Lou, Kit

Low, wong fook

Lum, Kok wah

ma, martin

martin, Colin

matich, miroslav

matthews, John

matuschka, Trevor

maule, Rachel

mayo, John

mcEnteer, Neil

mcKibbin, Robert

metge, Joan

millar, Janet

millar, Leslie

miller, Raymond

moores, Harold

Neilson, Peter

Newman, wayne

Nicks, Rowan

O’Connor, margaret

Optican, scott

Pereira, Anthony

Phillips, Yvonne

Pinder, Jennifer

Poh, felicia

Pollard, Joan

Priestley, John

Prinn, Ronald

Raudkivi, Arved

Reid, Helen

Robertson, Gillian

Rowe, Peter

Rykers, Neville

scott, John

silich, David

sinclair, Kathryn

sorrenson, Richard

stojanovich, Zoran

stuart, John

sutcliffe, william

synek, beth

Tan, Kim

Tan, simon

Tatham, Peter

Thompson, Katherine

Tonkin, John

Topping, Lesley

Trott, Donald

Trotter, maureen

Tudehope, bruce

Turnbull, John

Urlich, Ray

Urquhart, Gwynne

walker, Philippa

walker, Ranginui

wallace, Grant

watt, Russell

weber, Rosemary

wickham, Newton

williams, Jane

wilson, Peter

wilson, Rene

wiseman, Jennifer

woodward, mary

wright, Robert

Xanthopol, Anthony

Xanthopol, John

GifTs fROM ORGANisATiONs iN 2007

Anonymous (2)

Academy of Korean studies

Alcon Laboratories

Allergan New Zealand

Anthem foundation for Objectivist scholarship

Asb bank Limited

Asb Charitable Trust

Auckland University Engineers Association

AUEA Charitable Trust

bank of New Zealand

barfoot & Thompson

bausch & Lomb New Zealand Ltd

bayleys Real Estate Ltd

buckley systems Ltd

building Research

burr foundation

CPA Australia

Crocker Realty Limited

David & Genevieve becroft foundation

David Levene Charitable Trust

Department of Conservation

Donny Charitable Trust

DTZ NZ

Embassy of United states of America

Emerald Capital Investments Limited

Employers and manufacturers Association Inc

Energy Education Trust of New Zealand

EPCglobal

fisher & Paykel Appliances

fletcher building Employee Educational fund

freemasons Roskill foundation

friends of the Liggins Institute Charitable Trust

friends of The University of Auckland, Inc.

Genesis Energy

Goldman sachs Jbwere

Graeme Douglas family Trust 2

Gus fisher Charitable Trust

Hanban

Hawkins watts Limited

International College of Auckland

Invitrogen New Zealand Limited

James Trading Trust

Japan foundation

Jeremy Howard Educational Trust

Jones Lang Lasalle Ltd

Jubilee Crippled Children foundation Trust board

Kiwi Income Property Trust

Knight Coldicutt

Leighton Contractors

Lion foundation

Lou and Iris fisher Charitable Trust

maroal services Ltd

ministry of maori Development

msA Charitable Trust

multiplex Capital Ltd

National Institute of water & Atmospheric science

New Zealand Customs service

New Zealand Energy Planning Consultants Ltd

Novartis New Zealand Ltd

Orakei Trust

Pigeon mountain & Halcyon Days Trusts Partnership

Pindrop foundation

Ports of Auckland Ltd

Redwood Group

Robert & Noeline Chapman Trust

Robert Leitl Chair in Optometry Charitable Trust

Rotary Club of Ellerslie sunrise Inc

Rotary Club of waiheke Island

Roy & Val Allen No.2 Charitable Trust

Ruatotora Limited

seagar & Partners

shortland Trust

sir John Logan Campbell Residuary Estate

soft Options (NZ) Limited

solid Energy NZ Ltd

The warehouse

Tirohanga Holdings Limited

Todd foundation

Toll Tranzlink

Trans Tasman Properties Ltd

Trans-Tasman business Circle NZ

UK friends of The University of Auckland

Uniservices

The University of Auckland

Vector Limited

welbourn masonic Village social Committee

westpacDavid & Jeanette Allison should have been listed jointly as donors in the 2006 report

GIfT sOURCEs 2007

FOUNDATIONS (69%)

ALUMNI & FRIENDS (16%)

CORPORATIONS (8%)

OTHER (7%)

GIfTs PER ACADEmIC UNIT 2007

BUSINESS (28.7%)SCHOLARSHIPS (6.9%) OTHER UNIVERSITY (4.0%)

EDUCATION (3.2%)LIGGINS (2.5%)

MEDICINE (2.9%)ARTS (1.2%)

LAW (0.6%)NICAI (0.4%)

ENGINEERING (0.2%)

SCIENCE (49.9%)

GIfT TYPEs 2007

CHAIRS (13.3%)

FELLOWSHIPS (14.5%)

RESEARCH (9.8%)

GENERAL (9.6%)

SCHOLARSHIPS AND PRIZES (6.8%)PROGRAMMES (3.2%)

OTHER (0.4%)BUILDING (0.6%)

MULTIPLE (41.8%)

Gifts Received GifTs fROM iNdividUALs iN 2007


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ThE UNivERsiTy Of AUckLANd fOUNdATiON

Investments Friends of The University of AucklandThe Foundation has seen an impressive growth in its funds, from under $1 million at the end of 2002, to $43.5 million at the end of 2007.

To cope with this growth, in 2007 the Trustees made the important decision to split the foundation’s funds into two investment pools: the endowment pool for donations that will support activities over the long-term, usually by providing a slowly growing annual income while preserving the purchasing power of the original donation, and the current use pool for gifts that will support an activity taking place over a limited time period, for example, a building or specific research project that will use up all of the donation once it is completed.

It proved to be a challenging year in which to launch this new investment policy, given the difficulties in long-term investment markets globally in the last quarter of the year. However, the endowment pool’s perspective is for the long-term, and not any particular quarter or even year.

ENDOwmENT INVEsTmENT POOL

Each endowment donation to the foundation is invested into, and allocated its share of, the endowment investment pool. This pool is structured for long-term growth allowing for both annual distributions of some income to the beneficiaries (“available income”) and retention of the remaining income (“retained income”) to protect the capital value of the donations in the endowment pool. The current annual distribution rate is 5 percent; any excess income is retained to add to the initial donation.

The foundation’s endowment investment pool returned 3.3 percent before fees (2.7 percent net of fees), a slight outperformance compared to the pool’s composite benchmark return of 3.2 percent before fees*. The closing balance at year-end was $21.1 million.

following a review of the foundation’s investments, the Trustees, under advice from their investment consultants, mercer, decided in late 2007 to move from an endowment pool asset allocation of 50 percent cash and New Zealand government bonds, 30 percent international equities, and 20 percent Australasian equities, to a new endowment pool asset allocation of 35 percent international equities (50 percent NZD hedged); 15 percent Australasian equities; 26 percent international fixed income (100 percent NZD hedged); 8 percent cash; 6 percent NZ fixed income; 6 percent international property (100 percent NZD hedged) and 4 percent NZ property.

This allocation will be executed throughout 2008, including the selection of new managers where appropriate.

CURRENT UsE INVEsTmENT POOL

Each current use donation to the foundation is invested into, and allocated its share of, the current use investment pool. This pool is structured to return close to the official cash rate and hence protect the nominal value of the donation which will usually be used fairly soon after its receipt.

In contrast to the difficulties in the long-term investment markets, the short-term New Zealand investment market saw returns that were exceptional. The current use pool, which held investments in New Zealand cash or short-term bank term deposits, returned 8.5 percent net of fees. The average New Zealand Official Cash Rate for 2007 was 7.9 percent. The closing balance at year-end was $18.0 million.

OTHER fUNDs

A further $4.4 million was held outside either investment pool at year-end and will be allocated to the two main investment pools in 2008.

* The benchmark consisted of: 50 percent NZ government bond index; 30 percent msCI global shares index; 20 percent NZX 50 shares index.

Friends of The University of Auckland, IncThe Us friends continued their splendid support of The University of Auckland by making two grants to the foundation in 2007, totalling $372,070 (NZD). The main projects supported included the buckley Glavish Chair in Physics ($213,231; original donor: Hilton Glavish); the Alice Griffin fellowship in shakespearean studies ($82,566; original donor: John Griffin), and the brick family scholarships in medicine ($39,913; original donor: Greg brick). Other projects included scholarships in Engineering (segedin, Ardmore, Colombo) and general support for the faculties of Law and Engineering, the Liggins Institute and the Library.

DIRECTORs

Ms Bridget Liddell (chair), medina, washington

Professor ian Buckle, Reno, Nevada

Mr Quentin hills, san francisco, California

Professor Roland horne, stanford, California

Mr Jonathan Mason, boston, massachusetts

Professor stuart Mccutcheon, Auckland, New Zealand

Mr kristofer segerberg, fairfield, Connecticut

Mrs suzanne service, Tiburon, California

dr Peter Watson, washington, District of Columbia

UK Friends of The University of AucklandThe UK friends also provided stalwart support to the University, by granting $94,103 to the foundation, with the majority of the funds devoted to supporting the completion of the fitout of the Owen G Glenn business building ($92,357; original donors: John buchanan, Eric Tracey, Anne Quinn, Vodafone and bHP billiton).

dr John Buchanan (chair), surrey

Mr Neil Bogle, London

Professor sir Graeme davies, London

Mr Peter Gibson, berkshire

Mr Owen G Glenn, monaco

dr John hood, Oxford

Professor stuart Mccutcheon, Auckland

Ms Anne Quinn, London

Ms cecilia Tarrant, London

Mr Eric Tracey, London


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AccOUNTiNG POLiciEs

The University of Auckland foundation Incorporated is a charitable entity domiciled in New Zealand and registered under the Charities Act 2005. It was established by deed of trust dated 28 November 2002.

These summarised financial statements have been prepared in accordance with NZ GAAP. They comply with New Zealand equivalents to International financial Reporting standards (NZ IfRs) as appropriate for public benefit entities.

The summarised financial statements have been prepared on a historical cost basis except that financial Assets (all of which comprise financial assets at fair value through profit or loss), are measured at fair value.

The foundation is not subject to taxation on its income.

In accordance with NZ IfRs the foundation has changed the valuation of its financial assets to Net Assets Value (NAV). This has not resulted in any material change to the carrying values of the financial assets held by the foundation.

A variation executed in December 2007 to the Trust Deed Establishing The University of Auckland school of medicine foundation (sOmf) has granted the foundation the power to appoint the sOmf trustees. This power of appointment has been formally accepted with effect from 1 January 2008.

NOTEs

The summary financial statements were authorised by the Trustees on 6 march 2008. These have been prepared in order to provide interested persons with a succinct overview of the past performance of the foundation. The specific disclosures have been extracted from the audited full financial statements dated 6 march 2008.

The full financial statements were audited by wHK Gosling Chapman Partnership who issued an unqualified audit opinion. Users of the summary financial report should note that the information contained therein cannot be expected to provide as complete an understanding as provided by the full financial statements of the financial performance, financial position and cash flows of the foundation.

Users can view the financial statements on the foundation website: www.uoafoundation.org.nz. Alternatively users can also request the full financial statements from the foundation manager at External Relations, The University of Auckland, Private bag 92019, Auckland 1142.

Trustee6 March 2008

chairman

Financial Statements

statement of financial Performance for the year Ended 31 december 2007

2007$,000

2006$,000

Operating Revenue 16,239 14,031

Operating Expenses 1 2

Net investment surplus 16,238 14,029

Less:Grants and scholarships 2,193 1,693

Net surplus for the year 14,045 12,336

statement of Movements in Equity for the year Ended 31 december 2007

2007$,000

2006$,000

Equity at the beginning of the Year 29,455 17,119

Total Recognised Revenue and Expenses:

Net surplus for the Year 14,045 12,336

Equity at the End of the year 43,500 29,455

statement of financial Postition as at 31 december 2007

2007$,000

2006$,000

Current Assets 541 152

Current Liabilities 1 71

Net Current Assets 540 81

financial Assets 42,960 29,374

Net Assets 43,500 29,455

Represented by:

Equity 43,500 29,455

statement of cash flows for the year Ended 31 december 2007

2007$,000

2006$,000

Cash flows from Operating Activities:

Gifts and Legacies Received and Investment Income 12,719 13,364

Grants and scholarships and Other Payments (2,193) (1,755)

Net cash flows from Operating Activities 10,526 11,609

Cash flows from Investing Activities

Investments (10,065) (12,361)

Net cash Outflows from investment Activities (10,065) (12,361)

Net Increase/(Decrease) in Cash Held 461 (752)

Cash at the beginning of the Year 79 831

cash at the End of the year 540 79

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