Macquarie Timber Land Trust 2004 ARSN Annual report - 30 June 2014

Transcription

1 ARSN Annual report - 30 June 2014

2 ARSN Annual report - 30 June 2014 Contents Page Directors' Report 1 Auditor's Independence Declaration 4 Statement of Comprehensive Income 5 Statement of Financial Position 6 Statement of Changes in Equity 7 Statement of Cash Flows 8 Notes to the Financial Statements 9 Directors' Declaration 20 Independent Auditor's Report 21 This financial report covers Macquarie Timber Land Trust 2004 as an individual entity. The Responsible Entity of Macquarie Timber Land Trust 2004 is Macquarie Alternative Assets Management Limited (ABN ). The Responsible Entity's registered office is No. 1 Martin Place, Sydney, NSW 2000.

3 Directors' Report 30 June 2014 The directors of Macquarie Alternative Assets Management Limited, a wholly owned subsidiary of Macquarie Group Limited, the Responsible Entity of Macquarie Timber Land Trust 2004, present their report together with the financial report of Macquarie Timber Land Trust 2004 (the "Trust") for the year ended 30 June Principal activities The principal activities of the Trust are to invest in timber plantation land and receive rental income through operating leases. The rental income earned will be equal to 10% of net harvest proceeds, which will be paid in instalments during the harvest payment period. The Trust did not have any employees during the year. There were no significant changes in the nature of the Trust's activities during the year. Directors The following persons held office as directors of Macquarie Alternative Assets Management Limited during the year or since the end of the year and up to the date of this report: Antony Clubb Anthony John Abraham Peter Bruce Lucas William Dudley Fox Gary Shneier (appointed on 14/08/2014) Review and results of operations During the year, the Trust continued to be managed in accordance with the investment objective and strategy set out in the Trust s offer document and in accordance with the Trust Constitution. During the year, the Responsible Entity of the Trust entered into an agreement with Ararat Wind Farm Pty Limited (AWFPL) on behalf of unit holders, to grant easement to land, for which the Trust received compensation. Results The performance of the Trust, as represented by the results of its operations, was as follows: Operating profit before finance costs attributable to unitholders () 11,316 6 Distributions Distribution paid and payable () 11,316 - Distribution (cents per unit) Significant changes in state of affairs In the opinion of the directors, there were no significant changes in the state of affairs of the Trust that occurred during the financial year under review. 1

4 Directors' Report 30 June 2014 Matters subsequent to the end of the financial year On 9 July 2014, the Victorian Roads Corporation (VicRoads) has issued the Trust with a Notice of Acquisition to compulsory acquire hectares of land belonging to the Trust. We are currently in discussions with VicRoads in relation to the effectiveness of the notice and compensation if the acquisition proceeds. No matter or circumstance has arisen since 30 June 2014 that has significantly affected, or may significantly affect: (i) the operations of the Trust in future financial years, or (ii) the results of those operations in future financial years, or (iii) the state of affairs of the Trust in future financial years. Likely developments and expected results of operations The Trust will continue to be managed in accordance with the investment objective and strategy set out in the Trust s offer document and in accordance with the Trust Constitution. Further information on likely developments in the operations of the Trust and the expected results of those operations have not been included in this report because the Responsible Entity believes it would be likely to result in unreasonable prejudice to the Trust. Indemnification and insurance of officers and auditors No insurance premiums are paid for out of the assets of the Trust in regards to insurance cover provided to either the officers of Macquarie Alternative Assets Management Limited or the auditors of the Trust. Under the Trust Constitution, Macquarie Alternative Assets Management Limited as Responsible Entity of the Trust is entitled to be indemnified out of the assets of the Trust for any liability incurred by it in properly performing or exercising any of its powers or duties in relation to the Trust. Fees paid to and units held in the Trust by the Responsible Entity or its associates No fees were paid to the Responsible Entity and its associates out of Trust property during the year (2013: Nil). No fees were paid out of Trust property to the directors of the Responsible Entity during the year (2013: Nil). The number of units in the Trust held by the Responsible Entity, its directors or its associates as at the end of the financial year are disclosed in note 9 of the financial statements. Units in the Trust The movement in units on issue in the Trust during the year is disclosed in note 7 of the financial statements. The value of the Trust s assets and liabilities is disclosed on the statement of financial position and derived using the basis set out in note 2 of the financial statements. Environmental regulation The operations of the Trust are not subject to any particular or significant environmental regulations under a Commonwealth, State or Territory law. 2

5 Directors' Report 30 June 2014 Rounding of amounts to the nearest dollar Pursuant to Class Order 98/100 issued by the Australian Securities & Investments Commission, relating to the "rounding off" of amounts in the directors' report and financial report, amounts in the directors' report and financial report have been rounded off to the nearest dollar in accordance with that Class Order, unless otherwise indicated. Auditor's independence declaration A copy of the Auditor's independence declaration as required under section 307C of the Corporations Act 2001 is set out on page 4. This report is made in accordance with a resolution of the directors. Director:... Antony Clubb Sydney 25 September

6 Ernst & Young 680 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001 Tel: Fax: ey.com/au Auditor s Independence Declaration to the Directors of Macquarie Alternative Assets Management Limited In relation to our audit of the financial report of Macquarie Timber Land Trust 2004 for the financial year ended 30 June 2014, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of the Corporations Act 2001 or any applicable code of professional conduct. Ernst & Young Darren Handley-Greaves Partner 25 September 2014 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

7 Statement of Comprehensive Income Notes Investment income Interest income Lease rental income Easement compensation 10,486 - Total net investment income 11,441 6 Expenses Other expenses Total operating expenses Operating profit 11,316 6 Finance costs attributable to unitholders Distributions to unitholders 5 (11,316) - Increase in net assets attributable to unitholders 7 - (6) Profit/(loss) for the year - - Other comprehensive income for the year - - Total comprehensive income for the year - - The above statement of comprehensive income should be read in conjunction with the accompanying notes. 5

8 Statement of Financial Position As at 30 June 2014 Notes Assets Cash and cash equivalents 6 1, Receivables 1,027 - Land 8 5,440,000 5,440,000 Total assets 5,442,480 5,440,198 Liabilities Withholding tax payable 1,024 - Amounts payable to the Responsible Entity 9 1,186 - Distributions payable Other payables 72 - Total liabilities (excluding net assets attributable to unitholders) 2, Net assets attributable to unitholders - liability 7 5,440,001 5,440,001 The above statement of financial position should be read in conjunction with the accompanying notes. 6

9 Statement of Changes in Equity Total equity at the beginning of the year - - Total comprehensive income for the year - - Transactions with owners in their capacity as owners - - Total equity at the end of the year - - Under Australian Accounting Standards, net assets attributable to unitholders are classified as a liability rather than equity. As a result there was no equity at the start or end of the year. The above statement of changes in equity should be read in conjunction with the accompanying notes. 7

10 Statement of Cash Flows Notes Cash flows from operating activities: Lease rental income received Interest received Easement compensation received 11,535 - Net cash inflow from operating activities 10(a) 12,571 6 Cash flows from financing activities: Distributions paid (11,316) - Net cash outflow from financing activities (11,316) - Net increase in cash and cash equivalents 1,255 6 Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year 6 1, Non-cash financing activities 10(b) - - The above statement of cash flows should be read in conjunction with the accompanying notes. 8

11 Notes to the Financial Statements 1 General Information This financial report covers Macquarie Timber Land Trust 2004 (the "Trust") as an individual entity. The Trust was constituted on 18 December The Trust is expected to terminate on 31 December 2015 or a later date in accordance with the provisions of Trust Constitution. The Trust is a registered managed investment scheme domiciled in Australia. The Responsible Entity of the Trust is Macquarie Alternative Assets Management Limited (the "Responsible Entity''). The Responsible Entity s registered office is No. 1 Martin Place, Sydney, NSW The financial report is presented in Australian dollars. The Trust issued units at 500 per unit (GST free) in order to purchase the land on which the timber plantations are situated. Land owned by the Trust is used for forestry plantation purposes by the investors of the Macquarie Eucalypt Project The Macquarie Eucalypt Project 2004 is a managed investment scheme and its Responsible Entity is Macquarie Alternative Assets Management Limited (a wholly owned subsidiary of Macquarie Group Limited ("MGL")). During the year, the Responsible Entity of the Trust entered into an agreement with Ararat Wind Farm Pty Limited (AWFPL) on behalf of unit holders, to grant easement to land, for which the Trust received compensation. The financial statements were authorised for issue by the directors on 25 September The directors of the Responsible Entity have the power to amend and reissue the financial report. 2 Summary of Significant Accounting Policies The principal accounting policies applied in the preparation of these financial statements are set out below. These policies have been consistently applied to all years presented, unless otherwise stated in the following text. (a) Basis of Preparation This general purpose financial report has been prepared in accordance with Australian Accounting Standards, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001 in Australia. The financial report is prepared on the basis of fair value measurement of assets and liabilities except where otherwise stated. The statement of financial position is presented on a liquidity basis. Assets and liabilities are presented in decreasing order of liquidity and do not distinguish between current and non-current. All balances are expected to be recovered or settled within twelve months, except for net assets attributable to unitholders. The amount expected to be recovered or settled within twelve months after the end of each reporting period cannot be reliably determined. Where necessary, comparative information has been reclassified to be consistent with current period disclosures. 9

12 Notes to the Financial Statements 2 Summary of Significant Accounting Policies (continued) (a) Basis of Preparation (continued) Changes in Australian Accounting Standards The Trust has adopted all mandatory Australian Accounting Standards and Interpretations for the financial year beginning on or after 1 July The following key Accounting Standards and amendments to Accounting Standards became applicable in the current financial year: (i) AASB 10 Consolidated Financial Statements and related standards AASB 11 Joint Arrangements, AASB 12 Disclosure of Interest in Other Entities (effective from 1 January 2013) AASB 10 Consolidated Financial Statements establishes a new control model that applies to all entities. It replaces parts of AASB 127 Consolidated and Separate Financial Statements dealing with the accounting for consolidated financial statements and UIG Consolidation - Special Purpose Entities. AASB 11 Joint Arrangements and AASB 12 Disclosure of Interest in Other Entities affect the level of disclosures surrounding the Trust s interests in subsidiaries, associates, joint ventures and unconsolidated structured entities. Adoption of these standards has not had any effect on the financial position, performance or financial report disclosures of the Trust. (ii) AASB 13 Fair Value Measurement (effective from 1 January 2013) AASB 13 Fair Value Measurement establishes a single source of guidance under AASB for determining the fair value of assets and liabilities. AASB 13 Fair Value Measurement does not change when an entity is required to use fair value, but rather, provides guidance on how to determine fair value when fair value is required or permitted. Application of this definition may result in different fair values being determined for the relevant assets. AASB 13 Fair Value Measurement also expands the disclosure requirements for all assets or liabilities carried at fair value. This includes information about the assumptions made and the qualitative impact of those assumptions on the fair value determined. Adoption of this standard has not had any effect on the financial position, performance or financial report disclosures of the Trust. (iii) AASB Amendments to Australian Accounting Standards - Disclosures - Offsetting Financial Assets and Financial Liabilities (effective from 1 January 2013) These amendments require an entity to disclose information about rights of set-off and related arrangements (such as collateral agreements). The aim of the amendments is to provide users of financial statements with information about the effect or potential effect of such rights and arrangements on the Trust s financial position. The new disclosures are required for all recognised financial instruments that are set off in accordance with AASB 132 Financial Instruments: Presentation. These disclosures also apply to recognised financial instruments that are subject to an enforceable master netting arrangement or similar agreement, irrespective of whether they are set off in accordance with AASB 132 Financial Instruments: Presentation. The application of these amendments has not had any effect on the financial position, performance or financial report disclosures of the Trust. 10

13 Notes to the Financial Statements 2 Summary of Significant Accounting Policies (continued) (a) Basis of Preparation (continued) Compliance with International Financial Reporting Standards The financial statements also comply with International Financial Reporting Standards as issued by the International Accounting Standards Board. (b) Net assets attributable to unitholders Units are redeemable at the end of the Trust's finite life and are therefore classified as financial liabilities. The fair value of redeemable units is measured at the redemption amount that would be received if units were redeemed at the reporting date. (c) Cash and cash equivalents For the purpose of presentation in the statement of cash flows, cash includes cash on hand and deposits held at call with financial institutions. Cash equivalents include other short-term, highly liquid investments with original maturities of three months or less from the date of acquisition that are readily convertible to known amounts of cash, which are subject to an insignificant risk of changes in value and are held for the purpose of meeting short-term cash commitments rather than for investment or other purposes. Bank overdrafts, if any, are shown separately on the statement of financial position. (d) Land Land is initially recognised at acquisition cost and is subsequently measured at cost unless the carrying amount of land is greater than its recoverable amount. When such instances occur, the land is written down to its recoverable amount and the decrement recognised as an expense in the statement of comprehensive income in the financial year in which the recoverable amount write-down occurs. (e) Investment income Interest income and Lease rental income are recognised in the statement of comprehensive income on an accruals basis. (f) Expenses All expenses, including Responsible Entity fees, are recognised in the statement of comprehensive income on an accruals basis. (g) Income tax Under current legislation, the Trust is not subject to income tax as unitholders are presently entitled to the income of the Trust. (h) Distributions In accordance with the Trust Constitution, the Trust distributes its distributable income, and any other amounts determined by the Responsible Entity, to unitholders by cash or reinvestment. The distributions are recognised in the statement of comprehensive income as finance costs attributable to unitholders. 11

14 Notes to the Financial Statements 2 Summary of Significant Accounting Policies (continued) (i) Increase/decrease in net assets attributable to unitholders Income not distributed is included in net assets attributable to unitholders. Movements in net assets attributable to unitholders are recognised in the statement of comprehensive income as finance costs. (j) Functional and presentation currency Items included in the Trust s financial statements are measured using the currency of the primary economic environment in which it operates (the functional currency ). This is the Australian dollar, which reflects the currency of the economy in which the Trust competes for funds and is regulated. The Australian dollar is also the Trust s presentation currency. (k) Receivables Receivables may include such items as interest receivable. (l) Payables Payables includes liabilities and accrued expenses owing by the Trust which are unpaid as at each year end. (m) Goods and Services Tax (GST) The GST incurred on the costs of various services provided to the Trust by third parties have been passed onto the Trust. The Trust qualifies for RITC hence other expenses have been recognised in the statement of comprehensive income net of the amount of GST recoverable from the Australian Taxation Office (ATO). Accounts payable are inclusive of GST. The net amount of GST recoverable from the ATO is included in receivables in the statement of financial position. Cash flows relating to GST are included in the statement of cash flows on a gross basis. (n) Use of estimates The Trust may make estimates and assumptions that affect the reported amounts of assets and liabilities within the next financial year. Estimates are continually evaluated and based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. (o) New accounting standards and interpretations Certain new accounting standards and interpretations have been published that are not mandatory for the 30 June 2014 reporting periods. The Responsible Entity s assessment of the impact of these new standards (to the extent relevant to the Trust) and interpretations is set out below: (i) AASB 9 Financial Instruments, AASB Amendments to Australian Accounting Standards arising from AASB 9, AASB Amendments to Australian Accounting Standards - Conceptual Framework, Materiality and Financial Instruments - Part C and related amendment AASB and AASB Amendments to Accounting Standards AASB 9 Financial Instruments applies to annual reporting periods beginning on or after 1 January 2018 and will therefore apply to the Trust from 1 July

15 Notes to the Financial Statements 2 Summary of Significant Accounting Policies (continued) (o) New accounting standards and interpretations (continued) (i) AASB 9 Financial Instruments, AASB Amendments to Australian Accounting Standards arising from AASB 9, AASB Amendments to Australian Accounting Standards - Conceptual Framework, Materiality and Financial Instruments - Part C and related amendment AASB and AASB Amendments to Accounting Standards (continued) AASB 9 Financial Instruments requires all financial instruments to be measured at fair value unless the criteria for amortised cost are met. The application of the standard is not expected to change the measurement basis of any of the Trust's current financial instruments, however, AASB 9 Financial Instruments allows the Trust to elect to present gains and losses on equity securities through other comprehensive income, which may impact the presentation of these gains and losses. The impact of the standard may also change if the nature of the Trust's activities or investments changes prior to initial application. The Trust does not intend to early adopt AASB 9 Financial Instruments as permitted by the standard, and the actual impact on initial application will depend on certain elections as disclosed above. (ii) AASB Amendments to Australian Accounting Standards - Offsetting Financial Assets and Financial Liabilities These amendments clarify the meaning of a legally enforceable right to set-off. The amendments also clarify the application of AASB 132 Financial Instruments: Presentation offsetting criteria to settlement systems (such as central clearing house systems) which apply gross settlement mechanisms that are not simultaneous. These amendments are not expected to impact the Trust s financial position or performance and become effective for annual periods beginning on or after 1 January 2014 and will therefore apply to the Trust from 1 July The Trust does not intend to early adopt AASB Amendments to Australian Accounting Standards - Offsetting Financial Assets and Financial Liabilities as permitted by the standard. Management does not expect these amendments will have a significant effect on the financial position, performance or financial report disclosures of the Trust. (iii) AASB Amendments to Australian Accounting Standards - Investment Entities AASB Amendments to Australian Accounting Standards - Investment Entities applies to annual reporting periods beginning on or after 1 January 2014 and will therefore apply to the Trust from 1 July Under AASB Amendments to Australian Accounting Standards - Investment Entities, an investment entity may apply the exemption to consolidation and instead account for its investments in subsidiaries at fair value through profit and loss. Where the Trust qualifies as an investment entity, the change in accounting policy will be applied retrospectively in accordance with the transition provisions of AASB 10 Consolidated Financial Statements. The amendments also introduce new disclosure requirements for investment entities to AASB 12 Disclosure of Interests in Other Entities and AASB 127 Separate Financial Statements. The Trust does not intend to early adopt AASB Amendments to Australian Accounting Standards - Investment Entities as permitted by the standard. Management does not expect these amendments will have a significant effect on the financial position, performance or financial report disclosures of the Trust. Standards and interpretations that are not expected to have a material impact on the Trust have not been included. 13

16 Notes to the Financial Statements 2 Summary of Significant Accounting Policies (continued) (p) Rounding of amounts Pursuant to Class Order 98/100 issued by the Australian Securities & Investments Commission, relating to the "rounding off" of amounts in the directors' report and financial report, amounts in the directors' report and financial report have been rounded off to the nearest dollar in accordance with that Class Order, unless otherwise indicated. 3 Financial risk management (a) Strategy in using financial instruments The Trust's activities may expose it to interest rate risk, credit risk and liquidity risk. The Trust s overall risk management programme focuses on ensuring compliance with the Trust s Product Disclosure Statement and seeks to maximise the returns derived for the level of risk to which the Trust is exposed. (b) Interest rate risk The Trust is not subject to significant amounts of risk due to fluctuations in the prevailing levels of market interest rates. (c) Credit risk Credit risk arises from cash and cash equivalents, deposits with banks and interest receivables. None of these assets are impaired nor past due but not impaired. The Trust manages its exposure to credit risk by dealing with well established financial institutions that the Responsible Entity has assessed to have a high quality credit standing. The maximum exposure to credit risk at the reporting date is the carrying amount of cash and cash equivalents and other financial assets. (d) Liquidity risk The Trust is subject to liquidity risk in relation to the financial liabilities it holds. The Trust is required to pay the net assets attributable to unitholders on termination of the Trust (expected to occur in approximately 2015). 14

17 Notes to the Financial Statements 3 Financial risk management (continued) (d) Liquidity risk (continued) The table below analyses the Trust s financial liabilities (excluding net assets attributable to unitholders) into relevant maturity groupings based on the remaining period to the earliest possible contractual maturity date at 30 June 2014 and 30 June The amounts in the table are contractual undiscounted cash flows. On demand Less than 3 months 3-12 months 1-5 years Over 5 years Total 30 June 2014 Withholding tax payable - 1, ,024 Amounts payable to the Responsible Entity - - 1, ,186 Distributions payable Other payables Total liabilities (excluding net assets attributable to unitholders) - 1,096 1, ,479 On demand Less than 3 months 3-12 months 1-5 years Over 5 years Total 30 June 2013 Distributions payable Total liabilities (excluding net assets attributable to unitholders) (e) Fair value estimation The carrying amounts of all the Trust's financial assets and financial liabilities at the end of each reporting period approximated their fair values. 4 Auditor's remuneration During the year the following fees were paid or payable for services provided by the auditor of the Trust: Audit services Ernst & Young Australian firm Audit of financial reports 9,412 8,569 Other audit work under the Corporations Act Total remuneration for audit services 9,758 8,905 15

18 Notes to the Financial Statements 4 Auditor's remuneration (continued) Audit fees are paid out of the Responsible Entity's own resources. 5 Distribution to unitholders During the year the Trust has declared a distribution of 11,316 (2013: Nil). As at 30 June 2014, the Trust has a distributions payable of 197 to unitholders (2013: 197). 6 Cash and cash equivalents Money Market deposits 1, Total cash and cash equivalents 1, Net assets attributable to unitholders Movements in number of units and net assets attributable to unitholders during the year were as follows: As stipulated within the Trust Constitution, each unit (approximately one-third hectare of land) represents a right to an individual share in the Trust and does not extend to a right to the underlying assets of the Trust. There are no separate classes of units and each unit has the same rights attaching to it as all other units in the Trust. Opening balance 10,880 10,880 5,440,001 5,439,995 Increase in net assets attributable to unitholders Closing balance 10,880 10,880 5,440,001 5,440, No No Capital risk management The Trust manages its net assets attributable to unitholders as capital, notwithstanding net assets attributable to unitholders are classified as a liability. The amount of net assets attributable to unitholders is expected to remain constant until harvest payment period (expected to occur in approximately 2015). The Trust has issued 10,880 units at 500 per unit amounting to 5,440,000. The money received was utilised towards purchase of land as per the Product Disclosure Statement. Unitholders will receive distributions on receipt of lease rental income and/or from the net proceeds from the sale of land (expected to occur in approximately 2015). 16

19 Notes to the Financial Statements 8 Land Opening balance 5,440,000 5,440,000 Closing balance 5,440,000 5,440,000 During the year land measuring Nil plantable hectares (2013: Nil plantable hectares) was acquired. 9 Related party disclosures (a) Responsible Entity The Responsible Entity of Macquarie Timber Land Trust 2004 is Macquarie Alternative Assets Management Limited (MAAML), a wholly owned subsidiary of Macquarie Group Limited ("MGL"). (b) Key management personnel The following persons held office as directors of MAAML during the year or since the end of the year and up to the date of this report: Antony Clubb Anthony John Abraham Peter Bruce Lucas William Dudley Fox Gary Shneier (appointed on 14/08/2014) No amount is paid by the Trust directly to the directors of the Responsible Entity. Consequently, no compensation as defined in AASB 124 Related Party Disclosures is paid by the Trust to the directors as key management personnel. (c) Key management personnel unitholdings Key management personnel held units in the Trust as follows: 30 June 2014 Unitholder units held opening units held closing Units held % units acquired units disposed Distribution declared by the Trust Leslie M Abraham June 2013 Unitholder units held opening units held closing Units held % units acquired units disposed Distribution declared by the Trust Leslie M Abraham

20 Notes to the Financial Statements 9 Related party disclosures (continued) (d) Key management personnel loan disclosures The Trust has not made, guaranteed or secured, directly or indirectly, any loans to the key management personnel or their personally related entities at any time during the reporting period (2013: Nil). (e) Responsible Entity fees and other transactions The Responsible Entity did not receive any fees from the Trust during the year ended 30 June 2014 (2013: Nil). All expenses in connection with the preparation of accounting records and the maintenance of the unit register have been fully borne by the Responsible Entity. All related party transactions are conducted on normal commercial terms and conditions. The transactions during the year and amounts payable at year end between the Trust, and the Responsible Entity were as follows: During the year, the Responsible Entity incurred land maintenance expenses amounting to 125 (2013: Nil) which has been charged to the Trust. At 30 June 2014, 1,186 (2013: Nil) was payable to the Responsible Entity. MGL, a related party of the Responsible Entity, and the companies within the MGL group have undertaken various transactions with, and performed various services for the Trust as follows: The Trust places funds on deposit with Macquarie Bank Limited (MBL), a wholly-owned subsidiary of MGL. The carrying value of these deposits is disclosed in note 6. During the year, interest income earned from deposits with MBL was 125 (2013: 6). At 30 June 2014, interest receivable of 2 (2013: Nil) is due from MBL. The Trust has recognised lease rental income of 830 (2013: Nil), in respect of easement compensation received by Macquarie Eucalypt Project (f) Related Party's unitholdings Parties related to the Trust (including MAAML, its affiliates and other schemes managed by MAAML) held units in the Trust as follows: 30 June 2014 Unitholder units held opening units held closing Units held % units acquired units disposed Distributions declared by the Trust Macquarie Bank Limited June 2013 Unitholder units held opening units held closing Units held % units acquired units disposed Distributions declared by the Trust Macquarie Bank Limited There are no distributions payable to the above party as at 30 June 2014 (2013: Nil). 18

21 Notes to the Financial Statements 9 Related party disclosures (continued) (g) Other transactions within the Trust Apart from those details disclosed in this note, no directors of the Responsible Entity have entered into a material contract with the Trust since the end of the previous financial year and there were no material contracts involving directors' interests subsisting at year end. 10 Reconciliation of profit/(loss) to net cash inflow from operating activities (a) Reconciliation of profit/(loss) to net cash inflow from operating activities Profit/(loss) for the year - - Increase in net assets attributable to unitholders - 6 Distributions to unitholders 11,316 - Net change in receivables and other assets (1,027) - Net change in payables and other liabilities 2,282 - Net cash inflow from operating activities 12, (b) Non-cash financing activities The Trust did not engage in any non-cash financing or investment activities during the financial year (2013: Nil). 11 Events occurring after the reporting date On 9 July 2014, the Victorian Roads Corporation (VicRoads) has issued the Trust with a Notice of Acquisition to compulsory acquire hectares of land belonging to the Trust. We are currently in discussions with VicRoads in relation to the effectiveness of the notice and compensation if the acquisition proceeds. No significant events have occurred since the reporting date which would impact on the financial position of the Trust disclosed in the statement of financial position as at 30 June 2014 or on the results and cash flows of the Trust for the year ended on that date. 12 Contingent assets, contingent liabilities and commitments There are no outstanding contingent assets, contingent liabilities or commitments as at 30 June 2014 and 30 June

22 Directors' Declaration In the opinion of the directors of the Responsible Entity: (a) the financial statements and notes as set out on pages 5 to 19 are in accordance with the Corporations Act 2001, including: (i) (ii) complying with Accounting Standards, the Corporations Regulations 2001 and other mandatory professional reporting requirements; and giving a true and fair view of the Trust's financial position as at 30 June 2014 and of its performance for the financial year ended on that date; and (b) there are reasonable grounds to believe that the Trust will be able to pay its debts as and when they become due and payable. The directors declare that the notes to the financial statements include an explicit and unreserved statement of compliance with the International Financial Reporting Standards (see note 2(a)). This declaration is made in accordance with a resolution of the directors. Director... Antony Clubb Sydney 25 September

23 Ernst & Young 680 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001 Tel: Fax: ey.com/au Independent auditor's report to the unitholders of Macquarie Timber Land Trust 2004 We have audited the accompanying financial report of Macquarie Timber Land Trust 2004 ( the Trust ), which comprises the statement of financial position as at 30 June 2014, the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors' declaration. Directors' responsibility for the financial report The directors of Macquarie Alternative Assets Management Limited, the responsible entity for the Trust, are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the Corporations Act 2001 and for such internal controls as the directors determine are necessary to enable the preparation of the financial report that is free from material misstatement, whether due to fraud or error. In Note 2, the directors also state, in accordance with Accounting Standard AASB 101 Presentation of Financial Statements, that the financial statements comply with International Financial Reporting Standards. Auditor's responsibility Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance about whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal controls relevant to the entity's preparation of the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal controls. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Independence In conducting our audit we have complied with the independence requirements of the Corporations Act We have given to the directors of the company a written Auditor s Independence Declaration, a copy of which is included in the directors report. A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

24 Opinion In our opinion: a. the financial report of Macquarie Timber Land Trust 2004 is in accordance with the Corporations Act 2001, including: i ii giving a true and fair view of the Trust s financial position as at 30 June 2014 and of its performance for the year ended on that date; and complying with Australian Accounting Standards and the Corporations Regulations 2001; and b. the financial report also complies with International Financial Reporting Standards as disclosed in Note 2(a). Ernst & Young Darren Handley-Greaves Partner Sydney 25 September 2014 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation