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					TURNERS AUCTIONS LIMITED
 INTERIM REPORT JUNE 2007
CORPORATE STRUCTURE




                                TURNERS AUCTIONS
                                    LIMITED
                                Vehicle and commercial
                                   goods auctioneer




TURNERS FINANCE TURNERS FLEET                 SMART GROUP TURNERS SMART
    LIMITED        LIMITED                      SERVICES    AUTOCENTRE
                                                 LIMITED      LIMITED
  Provider of motor      Licensed Motor      Collector and Marketer             Vehicle
   vehicle finance     Vehicle Trader that   of information relating          refurbisher
     to auction         sources imported      to the sales price of
     customers        vehicles and general       used trucks and
                       goods for auctions       heavy machinery




       TURNERS INTERNATIONAL                        TURNERS TECHNOLOGY
          HOLDINGS LIMITED                           SOLUTIONS LIMITED
                                                                          51%
                                                         TURNERS
        TURNERS AUTO                                 NETRESULT LIMITED
           AUCTIONS                                       Software developer
        INCORPORATED
           (Canada)
                                                                          90%

                                                    TURNERS NETRESULT
                                                     AUSTRALIA LIMITED
                                                            Software seller
                                TURNERS AUCTIONS LIMITED




TABLE OF CONTENTS
For the six months ended 30 June 2007



Corporate Structure                                            IFC
Chairman’s & Chief Executive’s Report                            2
Consolidated Interim Income Statement                            6
Consolidated Interim Balance Sheet                               7
Consolidated Interim Statement of Changes in Equity              8
Consolidated Interim Cash Flow Statement                         9
Notes to the Financial Statements:                              10
1 Summary of Significant Accounting Polices                     10
2 Transition to International Financial Reporting Standards 23
3 Segment Information                                           24
4 Revenue                                                       26
5 Dividends                                                     26
6 Reconciliation of Profit After Income Tax to Net Cash Inflow
     from Operating Activities                                  27
7 Explanation of Transition to New Zealand Equivalents to
     International Financial Reporting Standards                28
Corporate Directory                                             39
Turners Auctions Branch Locations                              IBC
                                                  TURNERS AUCTIONS LIMITED




Chairman’s & Chief Executive’s Report

24 August 2007

Dear Shareholder

We are pleased to present the half year report of the Turners Auctions Group (the Group) for the six
months ended 30 June 2007.

Half Year Result, Dividend of 9.5 cents per share
In the first half of 2007 the Group posted a profit attributable to members of $0.53 million, down 78%
on the previous year. The directors are pleased to declare an interim dividend and special dividend
that together total 9.5 cents per share, payable in September 2007.

Profit Impact of Fraud
A significant fraud was discovered early this year which has adversely impacted the Group profit by
$1.16 million before tax. Without this fraud the profit attributable to members would have been
$1.29 million.

The Serious Fraud Office has been very supportive in assisting the management team with the
fraud investigation. The Company is now focused on remedying its internal control systems and
investigating all avenues to recover the stolen money. The Company intends to make more information
available to shareholders after the judicial process has run its course.

A Difficult Six Months for the Used Car Market
The used car market remained tough throughout the first half of 2007. More traders disappeared
from the market on the back of a 4.4% decline in dealer to public sales and a 9.9% decline in the
registrations of Ex-Overseas imported vehicles.

Turners Auctions unit sales declined by 2.5% in the same period with Turners Fleet unit sales down
6.1%. Despite the decline in sales, Turners Finance maintained the same number of loans as a year
ago. The directors are confident that the worst of the market conditions are now behind the Company
with an improving market evident in the months of July and August 2007.

Good Growth of Fleet Revenues and Earnings
Despite the trying market, Group revenues grew by 4% on the same period last year. Much of this
increase is driven by Turners Fleet where the average selling prices of its Turners Certified vehicles
increased by 15% or $2.8 million on the prior period. The increase in Fleet revenues, coupled with a
significant increase in gross margin resulted in Turners Fleet doubling its earnings compared to the
prior year.




2
                                                   TURNERS AUCTIONS LIMITED




Further uptake of “Turners Live”
The “Turners Live” internet software is becoming an increasingly popular way for our customers to
participate in our auctions from the comfort of their own homes and offices. Greater internet bidding
has helped increase average selling prices, with used car prices up 9% and damaged car prices up
15%. “Turners Live” now accounts for 15% of all Auction vehicle sales.

Review of Auction Business
Through the first half of 2007 the company undertook a thorough review of its auction business
strategy in response to changing market dynamics. These changes include the growth of more
informed internet buyers, a declining dealer customer base and lower consumer demand for imported
cars. As a result the following initiatives have been identified to drive the Group’s earnings in the
future:

•	      Launch	of	the	next	generation	of	“Turners	Live”	software
•	      Provision	of	more	detailed	vehicle	related	information	available	from	the	website
•	      Enhancement	of	Trade-In	services	for	customers	wanting	to	sell	their	existing	vehicles	prior		
        to buying a better car at auction
•	      Implementation	of	a	“Buy	Now”	option	for	customers	who	cannot	or	do	not	wish	to	wait	for	the
        physical auction to purchase cars

The Company will implement these initiatives as soon as is practical within the next twelve months.

Continued Strong Cash Flows and Increased Dividend
The Group continued to generate positive cash flows from its core operations with operating cash
flows of $2.6 million for the six month period ended 30 June 2007. It is from these strong cash flows
and its significant cash holdings that the Group is able to fund the following fully imputed dividends:

•	      An	interim	net	dividend	of	1.5	cents	per	share,	paying	out	78%	of	the	half	year	profit
        attributable to members.
•	      A	further	special	net	dividend	of	8.0	cents	per	share.

The dividends are payable on 21 September 2007 to shareholders registered with Turners Auctions
Limited at 5 pm Friday 14th September 2007. The directors have also declared supplementary
dividends to shareholders not tax-resident in New Zealand. The special dividend returns surplus cash
reserves to shareholders and also allows the Group to distribute surplus imputation credits.

First Report under IFRS
This report represents our first full Report under the new International Financial Reporting Standards
[IFRS]. The directors are pleased to advise that the changes do not have a significant impact on the
Group results that were previously reported under the New Zealand Financial Reporting Standards. A
full reconciliation of the differences is included at Note 7 of the Half Year Financial Statements.




                                                                                                          3
                                                   TURNERS AUCTIONS LIMITED




Future Outlook
Although there is much industry uncertainty around continued finance company failures and the
potential impact of the government proposed exhaust emission rules for imported vehicles, the
directors remain confident about the Group’s future. As a shareholder of Motor Trade Finance (MTF),
Turners Finance is not reliant on retail debentures to fund its lending activity. MTF has been lending
on motor vehicles since 1971 and continues to lead the market on all finance company performance
measurements. Accordingly the economic situation should not have any adverse effect on Turners
Finance Limited from a funds availability point of view.

In addition the Company is keeping in touch with the industry’s moves regarding exhaust emissions
and so will be able to cope with any new rules which may come into force.

The Group has a strong brand and committed and loyal staff. Continued innovation ensures that the
Group is well poised to respond to a rapidly changing used car market.

The directors express their appreciation to all staff who worked very hard in a difficult period for the
Group.




Michael Dossor                             Graham Roberts
Chairman                                   Chief Executive




4
5
Turners Auctions Limited
Income Statement
                                                 TURNERS AUCTIONS LIMITED


                                                         Six months    Six months
                                                              ended         ended      Year ended
 Consolidated interim                            Notes       30 June       30 June   31 December
 income statement                                               2007          2006           2006
  For the period ended 30 June 2007
                                                               $'000         $'000          $'000
  Revenue from
  continuing operations                          4           42,201        40,616         77,432

  Other income                                                   25            80              93
  Goods sold out of inventories expense                     (18,567)      (16,039)        (30,205)
  Subcontracted services exspense                            (1,973)       (2,052)         (3,938)
  Employee benefits expense                                  (8,230)       (7,725)        (15,371)
  Property expense                                           (3,793)       (3,429)         (7,010)
  Other operating leases expense                               (361)         (354)           (696)
  Depreciation and amortisation expense                      (1,440)       (1,397)         (2,838)
  Impairment of goodwill                                          -           (22)            (18)
  Advertising expense                                        (1,106)       (1,233)         (2,655)
  Write back of claims and losses                                 -             -             417
  Alleged fraud loss                                         (1,158)            -               -
  Other expenses                                             (4,323)       (4,004)         (8,521)
  Finance costs                                                (420)         (443)           (872)
  Total expenses                                             41,371        36,698          71,707

  Profit before income tax                                      855         3,998           5,818

  Income tax expense                                           (327)       (1,385)         (2,032)
  Profit from continuing operations                             528         2,613           3,786

  Loss from discontinued operations                               -          (250)           (705)
  Profit for the period                                         528         2,363           3,081

  Profit attributable to minority interest                       (4)           23              44
  Profit attributable to members of the Parent                  524         2,386           3,125

  Earnings per share for profit attributable
  to the ordinary equity holders of the Parent                Cents         Cents          Cents
  during the year:
  Basic earnings per share                                       1.9           8.7           11.4
  Diluted earnings per share                                     1.9           8.7           11.4



  The above income statement should be read in
  conjunction with the accompanying notes.




  6
Turners Auctions Limited
Balance Sheet
                                                 TURNERS AUCTIONS LIMITED




  Consolidated interim
  balance sheet                                       30 June   30 June   31 December
  As at 30 June 2007                                     2007      2006           2006
  Assets                                                $’000     $’000          $’000
  Current assets
  Cash and cash equivalents                            6,862      6,620         5,735
  Derivative financial instruments                         -          8             -
  Trade and other receivables                          7,488      7,519         4,632
  Finance receivables                                  5,501      5,221         5,278
  Current tax receivables                              1,868         79           382
  Inventories                                          9,923      8,803         9,422
  Total current assets                                31,642     28,250        25,449

  Non current assets
  Finance receivables                                   5,555    6,453          5,564
  Available-for-sale financial assets                      12       11             12
  Property, plant and equipment                         5,389    6,231          5,669
  Deferred tax assets                                     195      160            135
  Intangible assets                                     2,900    3,818          3,582
  Total non current assets                             14,051   16,673         14,962

  Total assets                                        45,693    44,923          40,411

  Liabilities
  Current liabilities
  Trade and other payables                            12,738     9,713          7,314
  Derivative financial instruments                         8         -             23
  Deferred income                                        125       114             92
  Finance payables                                     5,612     5,250          5,355
  Provisions                                              50        91             70
  Total current liabilities                           18,533    15,168         12,854

  Non current liabilities
  Finance payables                                      5,666     6,480          5,645
  Provisions                                              158       156            163
  Total non current liabilities                         5,824     6,636          5,808

  Total liabilities                                   24,357     21,804        18,662

  Net assets                                          21,336    23,119         21,749

  Equity
  Contributed equity                                  11,413    11,413         11,413
  Retained earnings                                    9,800    11,660         10,235
  Other reserves                                          89         5             81
  Equity attributable to members of the Parent        21,302    23,078         21,729

  Minority interest                                       34        41             20

  Total equity                                        21,336    23,119         21,749
  The above balance sheet should be read in
  conjunction with the accompanying notes.
                                                                                  7
Turners Auctions Limited
Statement of changes in equity
                                                    TURNERS AUCTIONS LIMITED



                                                            Six months    Six months
 Consolidated Interim                                            ended         ended      Year ended
 statement of                                                   30 June       30 June   31 December
 changes in equity                                                 2007          2006           2006
  For the period ended 30 June 2007
                                                    Notes         $’000         $’000          $’000
  Total equity at the beginning
  of the period                                                 21,749        22,400          22,400

  Cash flow hedges, net of tax                                      10           (89)          (109)
  Exchange differences on translation of
  foreign operations                                               (17)           55            138
  Minority interest in exchange differences on
  translation of foreign operations                                 10           (22)           (22)
  Net income recognised directly
  in equity                                                          3           (56)              7
  Profit for the period                                            528         2,363           3,081
  Total recognised income and
  expense for the year                                             531         2,307           3,088
  Transactions with equity holders
      Contributions of equity                                        -            23              23
      Employee share options                                        15             4              17
      Dividends provided for or paid                5             (959)       (1,669)         (3,833)
  Minority interest contributions                                    -            54              54
                                                                  (944)       (1,588)         (3,739)

  Total equity at the end of the period                         21,336        23,119         21,749




  The above statement of changes in equity should
  be read in conjunction with the accompanying
  notes.




  8
Turners Auctions Limited
Cash Flow Statement
                                                    TURNERS AUCTIONS LIMITED



                                                            Six months    Six months
  Consolidated Interim                                           ended         ended      Year ended
  cash flow                                                     30 June       30 June   31 December
  statement                                                        2007          2006           2006
  For the period ended 30 June 2007                 Notes         $’000         $’000          $’000
  Cash flows from operating activities
  Receipts from customers                                      215,598       212,371         411,375
  Payments to suppliers and employees                         (212,324)     (208,017)       (404,746)
  Net GST received/(paid)                                          279          (632)         (1,485)
  Interest received                                              1,305         1,179           2,432
  Interest paid                                                   (412)         (422)           (861)
  Income taxes paid                                             (1,879)       (1,995)         (2,185)
  Net cash inflow from operating
  activities                                        6            2,567         2,484           4,530

  Cash flows from investing activities
  Payments for property, plant and equipment                      (657)         (845)         (1,483)
  Payments for intangible assets                                   (20)         (771)         (1,206)
  Payments for investments                                           -             -              (1)
  Proceeds from sale of property, plant and
  equipment                                                        196           132            257
  Proceeds from sale of investments                                  -           (24)           158
  Net cash outflow from investing
  activities                                                      (481)       (1,508)         (2,275)

  Cash flows from financing activities
  Proceeds from issues of ordinary shares                            -            23              23
  Dividends paid to Parent’s shareholders           5             (959)       (1,669)         (3,833)
  Net cash outflow from financing
  activities                                                      (959)       (1,646)         (3,810)

  Net increase (decrease) in cash and
  cash equivalents                                               1,127          (670)         (1,555)
  Cash and cash equivalents at the beginning
  of the period                                                  5,735         7,290           7,290
  Cash and cash equivalents at end of
  the period                                                     6,862         6,620           5,735

  The above cash flow statement should be read in
  conjunction with the accompanying notes.




                                                                                                9
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007
                                                      TURNERS AUCTIONS LIMITED



   1       Summary of significant
           accounting policies

   These general purpose financial statements for the interim half year reporting period ended 30 June
   2007 have been prepared in accordance with NZ IAS 34 Interim Financial Reporting.

   The accounting policies used are compliant with New Zealand Equivalents to International Financial
   Reporting Standards (‘NZ IFRS’) and will be used in the Group’s first annual NZ IFRS financial
   statements for the year ending 31 December 2007.

   Accounting policies applied in these interim financial statements comply with NZ IFRS and NZ IFRIC
   interpretations issued and effective or issued and early adopted as at the time of preparing these
   financial statements as applicable to Turners Auctions Limited as a profit oriented entity. The Group,
   in complying with NZ IFRS is simultaneously in compliance with International Financial Reporting
   Standards (‘IFRS’). The NZ IFRS standards and NZ IFRIC interpretations that will be applicable as at
   31 December 2007, including those that will be applicable on an optional basis, are not known with
   certainty at the time of preparing these interim financial statements.

   (a)     Basis of preparation of half year financial report
   The principal accounting policies adopted in the preparation of the financial report are set out below.
   These policies have been consistently applied to all the periods presented, unless otherwise stated.

   Entities reporting
   The consolidated financial statements of the ‘Consolidated’ entity are for the economic entity
   comprising Turners Auctions Limited and its subsidiaries.

   The consolidated entity is designated as a profit orientated entity for financial reporting purposes.

   Statutory base
   Turners Auctions Limited (the ‘Company’) is a limited liability company which is domiciled and
   incorporated in New Zealand. It is registered under the Companies Act 1993 and is an issuer in terms
   of the Securities Act 1978. The Company has its primary listing on the New Zealand stock exchange.

   The financial statements have been prepared in accordance with the requirements of the Financial
   Reporting Act 1993 and the Companies Act 1993.

   Adoption of NZ IFRS 1 First time Adoption of New Zealand Equivalents to International Financial
   Reporting Standards (‘NZ IFRS’)
   The Group’s financial statements for the year ending 31 December 2007 will be the Group’s first annual
   financial statements that comply with NZ IFRS.

   These consolidated interim financial statements have been prepared in accordance with NZ IAS 34 and
   do not include all the information required for full annual financial statements. They are also covered
   by NZ IFRS 1 First-time Adoption of New Zealand Equivalents to International Financial Reporting
   Standards because they are part of the period covered by the Group’s first annual NZ IFRS financial

 10
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                       TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   statements for the year ending 31 December 2007.

   NZ IFRS 1 requires an entity to use the same accounting policies in its opening NZ IFRS balance sheet
   and throughout all the periods presented in its first NZ IFRS financial statements. The Group has
   adjusted amounts reported previously in financial statements prepared in accordance with its old
   basis of accounting (previous NZ GAAP), except where NZ IFRS 1 has allowed exemptions from full
   retrospective application of NZ IFRS. Details of the
   exemptions are given in note 2.

   Reconciliations and descriptions of the effect of transition from previous NZ GAAP to NZ IFRS on the
   Group’s equity and its net income are given in note 7.

   Historical cost convention
   These financial statements have been prepared under the historical cost convention, as modified by
   the revaluation of available-for-sale financial assets and financial assets and liabilities (including
   derivative instruments) at fair value through profit or loss.

   Critical accounting estimates
   The preparation of financial statements in conformity with NZ IFRS requires the use of certain critical
   accounting estimates. It also requires management to exercise its judgement in the process of
   applying the Group’s accounting policies. The inventories, trade and other receivables and finance
   receivables accounting policies (notes 1(l), 1(j)(ii) and 1(j)(iii))) are critical to the portrayal of the
   Group’s financial condition and results and require judgements and estimates about matters that are
   inherently uncertain.

   Seasonality of the business
   Sales of motor vehicles are typically stronger in summer months. The Group’s business is not subject
   to any other significant seasonal or cyclical variation.

   (b)     Principles of consolidation
           (i) Subsidiaries
   The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of
   Turners Auctions Limited (the ‘Company’ or ‘parent entity’) as at 30 June 2007 and the results of all
   subsidiaries for the half year then ended. Turners Auctions Limited and its subsidiaries together are
   referred to in these financial statements as the ‘Group’ or the ‘consolidated entity’.

   Subsidiaries are all those entities (including special purpose entities) over which the Company has
   the power to govern the financial and operating policies, generally accompanying a shareholding of
   more than one half of the voting rights. The existence and effect of potential voting rights that are
   currently exercisable or convertible are considered when assessing whether the Company controls
   another entity.

   Subsidiaries are fully consolidated from the date on which control is transferred to the Company.
   They are de-consolidated from the date that control ceases.



                                                                                                           11
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   The purchase method of accounting is used to account for the acquisition of subsidiaries by the Group.
   The cost of an acquisition is measured as the fair value of the assets given, equity instruments issued
   and liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the
   acquisition. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business
   combination are measured initially at their fair values at the acquisition date, irrespective of the
   extent of any minority interest. The excess of the cost of acquisition over the fair value of the Group’s
   share of the identifiable net assets acquired is recorded as goodwill. If the cost of acquisition is less
   than the fair value of the net assets of the subsidiary acquired, the difference is recognised directly in
   the income statement .

   Intercompany transactions, balances and unrealised gains on transactions between Group companies
   are eliminated. Unrealised losses are also eliminated unless the transaction provides evidence of the
   impairment of the asset transferred. Accounting policies of subsidiaries have been changed where
   necessary to ensure consistency with the policies adopted by the Company.

   Minority interests in the results and equity of subsidiaries are shown separately in the consolidated
   income statement and balance sheet respectively.

   (c)     Segment reporting
   A business segment is a group of assets and operations engaged in providing products or services
   that are subject to risks and returns that are different to those of other business segments. A
   geographical segment is engaged in providing products or services within a particular economic
   environment and is subject to risks and returns that are different from those of segments operating in
   other economic environments.

   Segment revenue is revenue that is directly attributable or can be reasonably allocated to a segment.
   Interest income, dividend income or gains on the sales of investments are not allocated to a segment
   (‘Unallocated’) unless that segment’s operations are primarily financial.

   Segment expense is expense that is directly attributable or can be reasonably allocated to a segment.
   Interest expense or losses on the sales of investments are Unallocated expenses unless the segment’s
   operations are primarily financial. Income tax expense and unusual expenses are Unallocated
   expenses.

   Segment result is segment revenue less segment expense.

   (d)     Foreign currency translation
           (i) Functional and presentation currency
   Items included in the financial statements of each of the Group’s operations are measured using the
   currency of the primary economic environment in which it operates (‘the functional currency’). The
   consolidated financial statements are presented in New Zealand dollars, which is the Company’s
   functional and presentation currency.

            (ii) Transactions and balances
   Foreign currency transactions are translated into the functional currency using the exchange rates
   prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the
 12
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   settlement of such transactions and from the translation at year end exchange rates of monetary
   assets and liabilities denominated in foreign currencies are recognised in the income statement,
   except when deferred in equity as qualifying cash flow hedges and qualifying net investment hedges.

           (iii) Foreign operations
   The results and financial position of foreign operations (none of which has the currency of a
   hyperinflationary economy) that have a functional currency different from the presentation currency
   are translated into the presentation currency as follows:
   •	      assets	and	liabilities	for	each	balance	sheet	presented	are	translated	at	the	closing	rate	at	the		
           date of that balance sheet;
   •	      income	and	expenses	for	each	income	statement	are	translated	at	average	exchange	rates;		
           and
   •	      all	resulting	exchange	differences	are	recognised	as	a	separate	component	of	equity.

   On consolidation, exchange differences arising from the translation of any net investment in foreign
   operations are taken to shareholders’ equity. When a foreign operation is sold, a proportionate share
   of such exchange differences is recognised in the income statement as part of the gain or loss on sale.

   Goodwill and fair value adjustments arising on the acquisition of foreign operation are treated as
   assets and liabilities of the foreign operation and translated at the closing rate.

   (e)     Revenue recognition
   Revenue comprises the fair value of the consideration receivable for the sale of goods and services,
   net of Goods and Services Tax, rebates and discounts and after eliminating sales within the Group.
   Revenue is recognised as follows:

           (i)    Sales of goods
   Sales of goods comprise sales of motor vehicles and commercial goods owned by the Group. Sales of
   goods are recognised when a Group entity sells a product to the customer. The recorded revenue is
   the gross amount of sales.

           (ii) Sales of services
   Sales of services comprise auction commission and other auction revenue, finance related insurance
   commission revenue and vehicle refurbishment revenue. Sales of services are recognised in the
   accounting period in which the services are rendered, by reference to completion of the specific
   transaction assessed on the basis of the actual service provided as a proportion of the total services
   to be provided.

           (iii) Rental and sub-lease rentals income
   Rental and sub-lease rentals income is recognised on a straight line basis over the lease term.

            (iv) Interest income
   Interest income is recognised on a time proportion basis using the effective interest method. The
   effective interest rate exactly discounts estimated future cash payments or receipts through the
   expected life of the receivable. Origination fees received by the Group, related direct costs and all

                                                                                                           13
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                       TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   other fees paid or received that are an integral part of the contract are deferred and recognised as an
   adjustment to the effective interest rate.

           (v) Dividend income
   Dividend income is recognised when the right to receive payment is established.

   (f)     Income tax
   The income tax expense or revenue for the period is the total of the current period’s taxable income
   based on the national income tax rate for each jurisdiction adjusted for any prior years’ under/over
   provisions and movements in the deferred tax balance, except where the movement in deferred tax is
   attributable to a movement in reserves.

   Movements in deferred tax are attributable to temporary differences between the tax base of assets
   and liabilities and their carrying amounts in the financial statements and any unused tax losses or
   credits. Deferred tax assets and liabilities are recognised for temporary differences at the tax rates
   expected to apply when the assets are recovered or liabilities are settled, based on those tax rates
   which are enacted or substantively enacted for each jurisdiction. An exception is made for certain
   temporary differences arising from the initial recognition of an asset or a liability. No deferred tax
   asset or liability is recognised in relation to these temporary differences if they arose in a transaction,
   other than a business combination, that at the time of the transaction did not affect either accounting
   profit or loss or taxable profit or loss.

   Deferred tax assets are recognised for deductible temporary differences and unused tax losses only
   to the extent that is probable that future taxable amounts will be available to utilise those temporary
   differences and losses.

   Deferred tax liabilities and assets are not recognised for temporary differences between the carrying
   amount and tax bases of investments in foreign operations where the Company is able to control the
   timing of the reversal of the temporary differences and it is probable that the differences will not
   reverse in the foreseeable future.

   The income tax expense or revenue attributable to amounts recognised directly in equity are also
   recognised directly in equity. The associated current or deferred tax balances are recognised in these
   accounts as usual.

   (g)     Goods and Services Tax (GST)
   The income statement has been prepared so that all components are stated exclusive of GST. All
   items in the balance sheet are stated net of GST, with the exception of receivables and payables which
   include GST invoiced.
   (h)     Leases
   Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor
   are classified as operating leases. Payments made under operating leases (net of any incentives
   received from the lessor) are charged to the income statement on a straight line basis over the period
   of the lease.



 14
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   (i)     Impairment of non-financial assets
   Assets are reviewed for impairment whenever events or changes in circumstances indicate that
   the carrying amount may not be recoverable. Intangible assets that have an indefinite useful life
   are not subject to amortisation and are tested annually for impairment irrespective of whether
   any circumstances identifying a possible impairment have been identified. An impairment loss is
   recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount.
   The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For
   the purposes of assessing impairment, assets are grouped at the lowest levels for which there are
   separately identifiable cash flows (cash generating units).

   (j)     Financial instruments
   Financial instruments comprise cash and cash equivalents, trade and other receivables, finance
   receivables, shares held in other entities, trade and other payables, finance payables and derivative
   financial instruments (forward foreign exchange contracts).

   Financial assets and financial liabilities are recognised on the Group’s balance sheet when the Group
   becomes a party to the contractual provisions of the instrument.

            (i) Cash and cash equivalents
   Cash and cash equivalents includes cash on hand, deposits held at call with financial institutions,
   other short term, highly liquid investments with original maturities of three months or less that are
   readily convertible to known amounts of cash and which are subject to an insignificant risk of changes
   in value, and bank overdrafts.

           (ii) Trade and other receivables
   Trade and other receivables are recognised initially at fair value and subsequently measured at
   amortised cost using the effective interest method, less provision for doubtful debts.

   Collectibility of trade and other receivables is reviewed on an ongoing basis. Debts which are known
   to be uncollectible are written off. A provision for doubtful receivables is established when there is
   objective evidence that the Group will not be able to collect all amounts due according to the original
   terms of receivables. The amount of the provision is the difference between the asset’s carrying
   amount and the present value of estimated future cash flows, discounted at the effective interest rate.
   The amount of the provision is recognised in the income statement.

            (iii) Finance receivables
   Finance receivables are initially measured at fair value less any attributable transaction costs.
   Subsequent to initial recognition, finance receivables are stated at amortised cost using the effective
   interest method, less any provision for impairment. Finance receivables are recognised when the
   cash is advanced on behalf of borrowers and are derecognised when the Group’s rights to receive cash
   flows have contractually expired.

   A provision for impairment of finance receivables is established on a counterparty basis when there is
   objective evidence that the Group will not be able to collect all amounts due according to the original
   terms of the receivables. Interest on these assets is accounted for on a cash basis. The amount of the

                                                                                                        15
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   provision is the difference between the assets’ carrying amount and the present value of estimated
   future cash flows, discounted at the effective interest rate. The amount of the provision is recognised
   in the Income Statement.

            (iv) Financial assets
   The Group classifies its financial assests in the following categories: financial assets at fair
   value through profit or loss, loans and receivables, and available-for-sale financial assets. The
   classification depends on the purpose for which the financial assests were acquired. Management
   determines the classification of its financial assests at initial recognition and re-evaluates this
   designation at each reporting date.

           • Financial assets at fair value through profit or loss
   This category has two sub categories: financial assets held for trading, and those designated at fair
   value through profit or loss on initial recognition. Derivatives are categorised as held for trading
   unless they are designated as hedges. Assets in this category are classified as current assets if they
   are either held for trading or are expected to be realised within 12 months of the balance sheet date.

           • Loans and receivables
   Loans and receivables are non derivative financial assets with fixed or determinable payments that are
   not quoted in an active market. They arise when the Group provides money, goods or services directly
   to a debtor with no intention of selling the receivable. They are included in current assets, except
   for those with maturities greater than 12 months after the balance sheet date which are classified as
   non current assets. Loans and receivables are included in trade and other receivables and finance
   receivables in the balance sheet.

            • Available-for-sale financial assets
   Available-for-sale financial assets, comprising principally marketable equity securities, are non
   derivatives that are either designated in this category or not classified in any of the other categories.
   They are included in non current assets unless management intends to dispose of the investment
   within 12 months of the balance sheet date.

   Purchases and sales of investments are recognised on trade date - the date on which the Group
   commits to purchase or sell the asset. Investments are initially recognised at fair value plus
   transaction costs for all financial assets not carried at fair value through profit or loss. Financial
   assets are derecognised when the rights to receive cash flows from the financial assets have expired
   or have been transferred and the Group has transferred substantially all the risks and rewards of
   ownership.

   Available-for-sale financial assets and financial assets at fair value through profit and loss are
   subsequently carried at fair value. Loans and receivables are carried at amortised cost using the
   effective interest method. Realised and unrealised gains and losses arising from changes in the fair
   value of the ‘financial assets at fair value through profit or loss’ category are included in the income
   statement in the period in which they arise. Unrealised gains and losses arising from changes in the
   fair value of non monetary securities classified as available-for-sale are recognised in equity in the
   available-for-sale investments revaluation reserve. When securities classified as available-for-sale

 16
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   are sold, the accumulated fair value adjustments are included in the income statement as gains and
   losses from investment securities.

   The Group establishes fair value by using valuation techniques. These include reference to the fair
   values of recent arm’s length transactions, involving the same instruments or other instruments that
   are substantially the same, discounted cash flow analysis, and option pricing models refined to reflect
   the issuer’s specific circumstances.

   The Group assesses at each balance date whether there is objective evidence that a financial asset
   or group of financial assets is impaired. In the case of equity securities classified as available-for-
   sale, a significant or prolonged decline in the fair value of a security below its cost is considered in
   determining whether the security is impaired. If any such evidence exists for available-for-sale
   financial assets, 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 profit and
   loss - is removed from equity and recognised in the income statement. Impairment losses recognised
   in the income statement on equity instruments are not reversed through the income statement.

            (v) Trade and other payables
   These amounts represent liabilities for goods and services provided to the Group prior to the end
   of financial period which are unpaid. The amounts are unsecured. Trade and other payables are
   recognised initially at fair value and subsequently measured at amortised cost using the effective
   interest method.

           (vi) Borrowings
   Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are
   subsequently measured at amortised cost. Any difference between the proceeds (net of transaction
   costs) and the redemption amount is recognised in the income statement over the period of the
   borrowings using the effective interest method. Arrangement fees are amortised over the term of the
   loan facility. Other borrowing costs are expensed when incurred.

   Borrowings are classified as current liabilities unless the Group has an unconditional right to defer
   settlement of the liability for at least 12 months after the balance sheet date.

           (vii) Derivatives
   Derivatives are initially recognised at fair value on the date a derivative contract is entered into and
   are subsequently remeasured to their fair value. The method of recognising the resulting gain or loss
   depends on whether the derivative is designated as a hedging instrument, and if so, the nature of the
   item being hedged. The Group designates certain derivatives as either; (1) hedges of the fair value
   of recognised assets or liabilities or a firm commitment (fair value hedge); or (2) hedges of highly
   probable forecast transactions (cash flow hedges).

   The Group documents at the inception of the transaction the relationship between hedging instruments
   and hedged items, as well as its risk management objective and strategy for undertaking various
   hedge transactions. The Group also documents its assessment, both at hedge inception and on an
   ongoing basis, of whether the derivatives that are used in hedging transactions have been and will

                                                                                                           17
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   continue to be highly effective in offsetting changes in fair values or cash flows of hedged items.

             • Fair value hedge
   Changes in the fair value of derivatives that are designated and qualify as fair value hedges are
   recorded in the income statement, together with any changes in the fair value of the hedged asset or
   liability that are attributable to the hedged risk.

            • Cash flow hedge
   The effective portion of changes in the fair value of derivatives that are designated and qualify as cash
   flow hedges is recognised in equity in the hedging reserve. The gain or loss relating to the ineffective
   portion is recognised immediately in the income statement.

   Amounts accumulated in equity are recycled in the income statement in the periods when the hedged
   item will affect profit or loss (for instance when the forecast sale that is hedged takes place).
   However, when the forecast transaction that is hedged results in the recognition of a non financial
   asset (for example, inventory) or a non financial liability, the gains and losses previously deferred
   in equity are transferred from equity and included in the measurement of the initial cost or carrying
   amount of the asset or liability.

   When a hedging instrument expires or is sold or terminated, or when a hedge no longer meets the
   criteria for hedge accounting, any cumulative gain or loss existing in equity at that time remains
   in equity and is recognised when the forecast transaction is ultimately recognised in the income
   statement. When a forecast transaction is no longer expected to occur, the cumulative gain or loss
   that was reported in equity is immediately transferred to the income statement.

            • Derivatives that do not qualify for hedge accounting
   Certain derivative instruments do not qualify for hedge accounting. Changes in the fair value of any
   derivative instrument that does not qualify for hedge accounting are recognised immediately in the
   income statement.

   (k)     Fair value estimation
   The fair value of financial assets and financial liabilities must be estimated for recognition and
   measurement or for disclosure purposes.

   The fair value of financial instruments that are not traded in an active market is determined using
   valuation techniques. The Group uses a variety of methods and makes assumptions that are based
   on market conditions existing at each balance date. Techniques, such as estimated discounted cash
   flows, are used to determine fair value for financial instruments. The fair value of forward exchange
   contracts is determined using forward exchange market rates at the balance sheet date.

   The nominal value less estimated credit adjustments of trade receivables and payables are assumed
   to approximate their fair values. The fair value of financial liabilities for disclosure purposes is
   estimated by discounting the future contractual cash flows at the current market interest rate that is
   available to the Group for similar financial instruments.



 18
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   (l)     Inventories
   Inventories are stated at the lower of cost and net realisable value comprise primarily motor vehicles
   held for resale. Net realisable value is the estimated selling price in the ordinary course of business
   less the estimated cost of completion and the estimated costs necessary to make the sale.

   (m)     Property, plant and equipment
   Property, plant and equipment is stated at historical cost less depreciation. Historical cost includes
   expenditure that is directly attributable to the acquisition of the items.

   Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as
   appropriate, only when it is probable that future economic benefits associated with the item will flow
   to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are
   charged to the income statement during the financial period in which they are incurred.

   Depreciation on property, plant and equipment is calculated using the straight line method to allocate
   its cost, net of its residual value, over its estimated useful life, as follows:

           Leasehold improvements                               over the life of the lease
           Computer equipment                                   3-5 years
           Motor vehicles, plant and equipment                  3-7 years
           Furniture and fittings, office equipment             5-12 years
           Signs and flags                                      13 years

   The assets’ residual values and useful lives are reviewed, and adjusted if appropriate, at each balance
   sheet date.

   An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s
   carrying amount is greater than its estimated recoverable amount (note 1(i)).

   Gains and losses on disposals are determined by comparing proceeds with carrying amount. These
   are included in the income statement.

   (n)     Intangible assets
            (i) Goodwill
   Goodwill represents the excess of the cost of an acquisition over the fair value of the Group’s share of
   the net identifiable assets of the acquired business at the date of acquisition. Goodwill on acquisitions
   of businesses is included in intangible assets. Goodwill acquired in business combinations is not
   amortised. Instead, goodwill is tested for impairment annually, or more frequently if events or
   changes in circumstances indicate that it might be impaired, and is carried at cost less accumulated
   impairment losses. Gains and losses on the disposal of an entity include the carrying amount of
   goodwill relating to the entity sold.

   Goodwill is allocated to cash generating units for the purpose of impairment testing.




                                                                                                        19
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                       TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


            (ii) Computer software
   Acquired computer software licences are capitalised on the basis of the costs incurred to acquire and
   bring to use the specific software. These costs are amortised over their estimated useful lives (one
   to three years).

   Costs associated with developing or maintaining computer software programmes are recognised as
   an expense as incurred. Costs that are directly associated with the production of identifiable and
   unique software products controlled by the Group, and that will probably generate economic benefits
   exceeding costs beyond one year, are recognised as intangible assets. Direct costs include the
   software development employee costs and an appropriate portion of relevant overheads.

   Computer software development costs recognised as assets are amortised over their estimated useful
   lives (not exceeding five years).

   (o)     Provisions
   Provisions for legal claims and service warranties are recognised when: the Group has a present
   legal or constructive obligation as a result of past events; it is more likely than not that an outflow
   of resources will be required to settle the obligation; and the amount has been reliably estimated.
   Provisions are not recognised for future operating losses.

   Where there are a number of similar obligations, the likelihood that an outflow will be required in
   settlement is determined by considering the class of obligations as a whole. A provision is recognised
   even if the likelihood of an outflow with respect to any one item included in the same class of
   obligations may be small.

   (p)     Employee benefits
             (i) Wages and salaries, annual leave and sick leave
   Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating
   sick leave expected to be settled within 12 months of the reporting date are recognised in other
   payables in respect of employees’ services up to the reporting date and are measured at the amounts
   expected to be paid when the liabilities are settled.

            (ii) Long service leave
   The liability for long service leave is recognised in the provision for employee benefits and measured
   as the present value of expected future payments to be made in respect of services provided by
   employees up to the reporting date using the projected unit credit method. Consideration is given to
   expected future wage and salary levels, experience of employee departures and periods of service.
   Expected future payments are discounted using market yields at the reporting date on national
   government bonds with terms to maturity and currency that match, as closely as possible, the
   estimated future cash outflows.

           (iii) Retirement benefit obligations
   The Group pays contributions to a multi employer superannuation plan. The plan is a defined
   contribution section as it receives fixed contributions from the Group and the Group’s legal or
   constructive obligation is limited to these contributions.

 20
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                        TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   Contributions are recognised as employee benefit expenses in respect of employee’s services up to the
   reporting date.
            (iv) Share-based payments
            • For share options granted on or before 7 November 2002
   No compensation expense is recognised in respect of share options granted to executive management
   if the exercise price, together with any amounts received when the options are granted, is equal to or
   greater than the market price of the shares on the date that the options are granted. If the options
   are granted at a discount to the market price, a remuneration expense is recognised in the statement
   of financial performance based on that discount. When the options are exercised, the proceeds
   received are credited to share capital.

            • For share options granted after 7 November 2002
   The Group operates an equity-settled, share-based compensation plan. The fair value of the
   employee services received in exchange for the grant of the options is recognised as an expense. The
   total amount to be expensed over the vesting period is determined by reference to the fair value of
   the options granted, excluding the impact of any non-market vesting conditions (for example, service
   conditions). Non-market vesting conditions are included in assumptions about the number of options
   that are expected to become exercisable. At each balance sheet date, the entity revises its estimates
   of the number of options that are expected to become exercisable. It recognises the impact of the
   revision of original estimates, if any, in the income statement, and a corresponding adjustment to
   equity over the remaining vesting period.

   The proceeds received net of any directly attributable transaction costs are credited to share capital
   when the options are exercised.

             • For cash-settled share-based payments
   The Group operates a cash-settled, share-based compensation plan. The employee services and a
   liability to pay for those services are recognised as the employees render service. The services and
   the liability are measured at the fair value of the liability. The fair value of the liability is remeasured
   at each reporting date and at the date of settlement. Any changes in fair value are recognised in the
   income statement.

           (v) Profit sharing and bonus plans
   The Group recognises a liability and an expense for bonuses and profit-sharing based on a formula
   that takes into consideration the profit attributable to the Company’s shareholders after certain
   adjustments. The Group recognises a provision where contractually obliged or where there is a past
   practice that has created a constructive obligation.

   (q)     Contributed equity
   Ordinary shares are classified as equity.
   Incremental costs directly attributable to the issue of new shares are shown in equity as a deduction,
   net of tax, from the proceeds.




                                                                                                            21
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED
Summary of significant
accounting policies (continued)


   (r)     Earnings per share
            (i) Basic earnings per share
   Basic earnings per share is calculated by dividing the profit attributable to equity holders of the
   Company, by the weighted average number of ordinary shares outstanding during the half year.
            (ii) Diluted earnings per share
   Diluted earnings per share adjusts the figures used in the determination of basic earnings per share
   to take into account the after income tax effect of interest and other financing costs associated with
   dilutive potential ordinary shares and the weighted average number of shares assumed to have been
   issued for no consideration in relation to dilutive potential ordinary shares.

   (s)     Standards, interpretations and amendments to published standards that are
   not yet effective
   Certain new standards, amendments and interpretations to existing standards have been published
   that are mandatory for the Group’s accounting periods beginning on or after 1 January 2008 or later
   periods but which the Group has not early adopted:

   •	      NZ	IAS	23	(Amendment),	Borrowing	Costs	(effective	from	annual	periods	beginning	on	or	after		
           1 January 2009). NZ IAS 23 is not relevant to the Group’s operations.

   •	      NZ	IFRS	8,	Operating	Segments	(effective	from	annual	periods	beginning	on	or	after	1	January		
           2009). NZ IFRS 8 specifies how an entity should report information about its operating
           segments. It also sets out requirements for related disclosures about products and services,
           geographical areas and major customers. The impact of the standard will be that information
           reported about operating segments will be more closely aligned with the Group’s internal
           reporting. The Group will apply the standard from 1 January 2009.

   •	      NZ	IFRIC	11:	IFRS	2,	Group	and	Treasury	Share	Transactions	(effective	from	annual	periods
           beginning on or after 1 March 2007). NZ IFRIC 11 specifies the treatment of share-based
           payments that are settled by equity instruments provided either by shareholders or third
           parties. It also covers the treatment of rights to equity instruments of a parent entity granted
           to employees of a subsidiary. The Group will apply NZ IFRIC 11 from 1 January 2008 but it is
           not expected to have any impact on the Group’s accounts.

   •	      NZ	IFRIC	12,	Service	Concession	Arrangements	(effective	from	1	January	2008).			NZ	IFRIC	12	is
           not relevant to the Group’s operations.

   •	      IFRIC	13,	Customer	Loyalty	Programmes	(effective	from	annual	periods	beginning	on	or	after
           1 July 2008). IFRIC 13 is not relevant to the Group’s operations.

   •	      IFRIC	14,	The	Limit	on	a	Defined	Benefit	Asset,	Minimum	Funding	Requirements	and	their
           Interaction (effective from annual periods beginning on or after 1 January 2008). IFRIC 14 is
           not relevant to the Group’s operations.




 22
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
Transition to international
                                                     TURNERS AUCTIONS LIMITED
financial reporting standards
(continued)


   2       Transition to international financial
           reporting standards

   (a)     Application of NZ IFRS 1
   The Group’s interim financial statements for the six months ended 30 June 2007 are the first financial
   statements that comply with NZ IFRS. These financial statements have been prepared as described in
   note 1. The Group has applied NZ IFRS in preparing these consolidated financial statements.

   The Group’s transition date is 1 January 2006. The Group prepared its opening NZ IFRS balance sheet
   at that date. The reporting date of these interim financial statements is 30 June 2007. The Group’s NZ
   IFRS adoption date is 1 January 2007.

   In preparing these interim financial statements in accordance with NZ IFRS 1, the Group has applied
   the mandatory exceptions, where applicable and certain of the optional exemptions from full
   retrospective application of NZ IFRS.

   (b)     Mandatory exceptions
   The following mandatory exceptions from retrospective application have been applied:
            (i) Estimates
   Estimates under NZ IFRS at 31 December 2005 are required to be consistent with estimates made for
   the same date under previous NZ GAAP, unless there is evidence that those estimates were in error.
   No adjustments to previous estimates have been made.

           (ii) Assets held for sale and discontinued operations
   The Group did not have any assets that met the held for sale criteria during the period presented and
   therefore no adjustment was required.

           (iii) Derecognition of financial assets and financial liabilities
   Financial assets and liabilities derecognised before 31 December 2005 are not re-recognised under
   NZ IFRS.

          (iv) Hedge accounting
   Hedge accounting has been adopted since 1 January 2006 only if the hedge relationship meets all the
   hedge accounting criteria under NZ IAS 39.

   (c)     Optional exemptions
   The following optional exemptions from full retrospective application have been applied:
            (i) Business combinations
   Business combinations before the date of transition have been accounted for under previous NZ GAAP
   and not been restated under NZ IFRS.

           (ii) Share-based payments
   Share-based payments that had vested by the transition date have have been accounted for under
   previous NZ GAAP and not been restated under NZ IFRS.



                                                                                                      23
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                        TURNERS AUCTIONS LIMITED



  3        Segment information
  (a)      Description of segments
  The Group is organised into four main business segments and other operations:


                                                  s
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                                             c ti
                                            Au

  Remarketing of motor vehicles and commercial goods.

  Fleet
  Purchase of motor vehicles and commercial goods for resale.

  Finance
  Provision of motor vehicle finance.

  Smart Autocentre
  Refurbishment and repair of motor vehicles.

  Other
  Includes remarketing of trucks and heavy machinery and software development. None of these
  activities constitutes a separately reportable segment.

  (b)      Primary reporting format-business segments
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                                            $'000      $'000      $'000    $'000         $'000      $'000           $'000
   Sales to external customers             18,667     20,799      1,280      447           737          -          41,930
   Inter-segment sales                        929          -       (150)       -            73       (852)              -
   Segment revenue                         19,596     20,799      1,130      447           810       (852)         41,930
   Unallocated revenue                                                                                                271
   Total sales revenue                                                                                             42,201

   Segment contribution                      424       1,427        208     (191)         (122)           -          1,746
   Inter-segment revenue less
   inter-segment expenses                     856       (779)      (150)       -             73           -              -
   Segment result                           1,280        648         58     (191)           (49)          -          1,746
   Alleged fraud loss                                                                                               (1,158)
   Unallocated revenue less other
   unallocated expenses                                                                                               267
   Profit before income tax                                                                                           855

   Segment assets                          14,621      10,149    11,402     366             386      8,769         45,693

   Supplementary information
   Commission and other auction revenue    18,494           -          -        -           219           -        18,713

   Sale of goods                                -     20,800           -        -             -           -        20,800

   Goods sold out of inventories expense        -     (18,567)         -        -             -           -        (18,567)




 24
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                      TURNERS AUCTIONS LIMITED




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                                                                                                              To
   Six months ended 30 June 2006
                                            $’000     $’000     $’000    $’000         $’000       $’000           $’000
   Sales to external customers             19,447    18,019     1,496      509           819           -          40,290
   Inter-segment sales                        911         -      (150)       -           199        (960)              -
   Segment revenue                         20,358    18,019     1,346      509         1,018        (960)         40,290
   Unallocated revenue                                                                                               326
   Total sales revenue                                                                                            40,616

   Segment contribution                     2,650     1,075      448      (190)        (298)            -          3,685
   Inter-segment revenue less
   inter-segment expenses                     712      (761)     (150)       -            199           -              -
   Segment result                           3,362       314       298     (190)           (99)          -          3,685
   Unallocated revenue less unallocated
   expenses                                                                                                          313
   Profit before income tax                                                                                        3,998

   Segment assets                          15,216     8,972    13,093      491         1,428       5,723       44,923

   Supplementary information
   Commission and other auction revenue    18,709         -          -        -           748           -         19,457

   Sale of goods                                -    18,017          -        -             -           -         18,017

   Goods sold out of inventories expense        -   (16,039)         -        -             -           -     (16,039)


   Year ended 31 December 2006



   Sales to external customers             37,449    34,105     2,610     1,183        1,422            -         76,769
   Inter-segment sales                      1,719         -      (271)        -          361       (1,809)             -
   Segment revenue                         39,168    34,105     2,339     1,183        1,783       (1,809)        76,769
   Unallocated revenue                                                                                               663
   Total sales revenue                                                                                            77,432

   Segment contribution                     3,629     1,778      696      (323)         (576)           -          5,204
   Inter-segment revenue less
   inter-segment expenses                   1,368    (1,448)     (271)       -          351             -              -
   Segment result                           4,997       330       425     (323)        (225)            -          5,204
   Unallocated revenue less unallocated
   expenses                                                                                                          614
   Profit before income tax                                                                                        5,818

   Segment assets                          12,611     9,498    12,354      409            574      4,965          40,411

   Supplementary information
   Commission and other auction revenue    37,059         -          -        -           363           -         37,422

   Sale of goods                                -    34,105          -        -             -           -         34,105

   Goods sold out of inventories expense        -   (30,205)         -        -             -           -     (30,205)




                                                                                                                  25
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED



   4       Revenue
                                                          Six months      Six months
                                                               ended           ended          Year ended
                                                              30 June         30 June       31 December
                                                                 2007            2006               2006
                                                                $’000           $’000              $’000

   Sale of goods                                               20,800          18,017              34,105
   Sales of services
      Commission and other auction revenue                     18,713          19,457              37,422
      Finance related insurance commission                        282             409                 610
      Other services revenue                                    1,007           1,161               2,323
   Rents and sub lease rentals                                    173             201                 393
   Interest                                                     1,226           1,371               2,579
                                                               42,201          40,616              77,432



   5       Dividends
                                                        Six months          Six months
                                                             ended               ended      Year ended
                                                            30 June             30 June   31 December
                                                               2007                2006            2006
                                                    Cents per share     Cents per share Cents per share
   Dividends paid                                                3.5                 6.0                14.0


   On 24 August 2007 the Directors approved the payment of an interim dividend of 1.5 cents per
   share (2006 - 8 cents) and a special dividend of 8 cents per share. Both dividends will be paid on
   21 September 2007 (15 September 2006) and will carry full imputation credits and supplementary
   dividends for overseas shareholders.




 26
                                                TURNERS AUCTIONS LIMITED



6       Reconciliation of profit after income
        tax to net cash inflow from operating
        activities

                                                  Six months     Six months
                                                       ended          ended      Year ended
                                                      30 June        30 June   31 December
                                                         2007           2006           2006
                                                        $’000          $’000          $’000
Profit for the period                                    528          2,363           3,081
Depreciation and amortisation                          1,440          1,448           2,941
Impairment of goodwill                                     -             22              22
Non cash employee benefits expense -
share-based payments                                      15               5             18
Non cash employee benefits expense -
long service leave                                         (5)          (13)            (6)
Net (gain) loss on sale of non current assets               3           (16)           (24)
Net loss on disposal of subsidiaries                        -             6            164
Net exchange differences                                   (6)           15             42
Costs and fees charged in finance receivables
carrying amount                                           83            (31)            (43)
Change in operating assets and liabilities
    (Increase) in receivables                         (2,912)        (1,765)            924
    Decrease (Increase) in inventories                  (501)        (1,147)         (1,791)
    Increase (decrease) in payables                    5,437            433            (924)
    Increase in provision for
    income taxes payable                              (1,486)           810            (332)
    Increase (decrease) in provision
    for deferred income tax                              (66)           212             248
    Increase (decrease) in other provisions               37            142             210
Net cash inflow from operating activities              2,567          2,484           4,530




                                                                                         27
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                   TURNERS AUCTIONS LIMITED



  7        Explanation of transition to
           New Zealand equivalents to
           international financial reporting
           standards
  (1)      Reconciliation of equity reported under previous New Zealand Generally
           Accepted Accounting Principles (NZ GAAP) to equity under New Zealand
           Equivalents to International Financial Reporting Standards (NZ IFRS)

  (a)      At the date of transition to NZ IFRS:
                                                                            Effect of
                                                       Previous NZ      transition to
           1 January 2006                                    GAAP            NZ IFRS    NZ IFRS
                                                 Notes       $’000             $’000      $’000
  Current assets
  Cash and cash equivalents                                  7,290                 -     7,290
  Derivative financial instruments               (4)(d)          -               140       140
  Trade and other receivables                                6,116                 -     6,116
  Finance receivables                            (4)(g,h,i) 4,556                 46     4,602
  Current tax receivables                                        1                 -         1
  Inventories                                                7,662                 -     7,662
  Total current assets                                      25,625               186    25,811

  Non current assets
  Finance receivables                            (4)(g,h,i)    6,052             (4)     6,048
  Available-for-sale financial assets                             11              -         11
  Property, plant and equipment                  (4)(j)       10,109         (3,466)     6,643
  Deferred tax assets                            (4)(n)          245             12        257
  Intangible assets                              (4)(j)          212          3,466      3,678
  Total non current assets                                    16,629              8     16,637


  Total assets                                                42,254             194    42,448

  Current liabilities
  Trade and other payables                                     8,787               -     8,787
  Current tax liabilities                                         88               -        88
  Deferred income                                (4)(e,i)        139             (48)       91
  Finance payables                                             4,602               -     4,602
  Provisions                                     (4)(b)            -              99        99
  Total current liabilities                                   13,616              51    13,667

  Non current liabilities
  Finance payables                                             6,113               -     6,113
  Payables                                                       100               -       100
  Provisions                                     (4)(c)            -             168       168
  Total non current liabilities                                6,213             168     6,381

  Total liabilities                                           19,829             219    20,048

  Net assets                                                  22,425             (25)   22,400

  Equity
  Contributed equity                                          11,390               -    11,390
  Retained earnings                              (4)(o)       11,062            (119)   10,943
  Other reserves                                 (4)(d,n)        (59)             94        35
  Equity attributable to members of the Parent                22,393             (25)   22,368

  Minority interest                                               32               -        32
  Total equity                                                22,425             (25)   22,400
 28
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                   TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

  (b)      At the end of the last reporting period under previous NZ GAAP: 31 December 2006

                                                                           Effect of
                                                       Previous NZ     transition to
                                                             GAAP           NZ IFRS    NZ IFRS
                                                 Notes       $’000            $’000      $’000
  Current assets
  Cash and cash equivalents                                    5,735              -     5,735
  Trade and other receivables                                  4,632              -     4,632
  Finance receivables                            (4)(g,h,i)    5,301            (23)    5,278
  Current tax receivables                                        382              -       382
  Inventories                                                  9,422              -     9,422
  Total current assets                                        25,472            (23)   25,449

  Non current assets
  Finance receivables                            (4)(g,h,i)    5,589           (25)     5,564
  Available-for-sale financial assets                             12             -         12
  Property, plant and equipment                  (4)(j)        9,251        (3,582)     5,669
  Deferred tax assets                            (4)(n)           93            42        135
  Intangible assets                              (4)(j)            -         3,582      3,582
  Total non current assets                                    14,945            17     14,962

  Total assets                                                40,417             (6)   40,411

  Current liabilities
  Trade and other payables                       (4)(k)        7,361            (47)    7,314
  Derivative financial instruments               (4)(d)            -             23        23
  Deferred income                                (4)(e,i,k)      226           (134)       92
  Finance payables                                             5,355              -     5,355
  Provisions                                     (4)(b)            -             70        70
  Total current liabilities                                   12,942            (88)   12,854

  Non current liabilities
  Finance payables                                             5,645              -     5,645
  Provisions                                     (4)(a,c)          -            163       163
  Total non current liabilities                                5,645            163     5,808

  Total liabilities                                           18,587             75    18,662

  Net assets                                                  21,830            (81)   21,749

  Equity
  Contributed equity                                        11,413                -    11,413
  Retained earnings                              (4)(o)     10,318              (83)   10,235
  Other reserves                                 (4)(a,d,n)     79                2        81
  Equity attributable to members of the Parent              21,810              (81)   21,729

  Minority interest                                               20              -        20
  Total equity                                                21,830            (81)   21,749

                                                                                           29
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                   TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

  (c)      At the end of the last six month reporting period under previous NZ GAAP: 30 June 2006

                                                                           Effect of
                                                       Previous NZ     transition to
                                                             GAAP           NZ IFRS      NZ IFRS
                                                 Notes       $’000            $’000        $’000
  Current assets
  Cash and cash equivalents                                    6,620              -       6,620
  Derivative financial instruments               (4)(d)            -              8           8
  Trade and other receivables                                  7,519              -       7,519
  Finance receivables                            (4)(g,h,i)    5,197             24       5,221
  Current tax receivables                                         79              -          79
  Inventories                                                  8,803              -       8,803
  Total current assets                                        28,218             32      28,250

  Non current assets
  Finance receivables                            (4)(g,h,i)    6,415            38        6,453
  Available-for-sale financial assets                             11             -           11
  Property, plant and equipment                  (4)(j)       10,049        (3,818)       6,231
  Deferred tax assets                            (4)(n)          134            26          160
  Intangible assets                              (4)(j)            -         3,818        3,818
  Total non current assets                                    16,609            64       16,673

  Total assets                                                44,827             96      44,923

  Current liabilities
  Trade and other payables                       (4)(k)        9,723            (10)      9,713
  Deferred income                                (4)(e,l,k)      205            (91)        114
  Finance payables                                             5,250              -       5,250
  Provisions                                     (4)(b)            -             91          91
  Total current liabilities                                   15,178            (10)     15,168

  Non current liabilities
  Finance payables                                             6,480              -       6,480
  Provisions                                     (4)(a,c)          -            156         156
  Total non current liabilities                                6,480            156       6,636

  Total liabilities                                           21,658            146      21,804

  Net assets                                                  23,169            (50)     23,119

  Equity
  Contributed equity                                        11,413                -      11,413
  Retained earnings                              4(o)       11,719              (59)     11,660
  Other reserves                                 (4)(a,d,n)     (4)               9           5
  Equity attributable to members of the Parent              23,128              (50)     23,078

  Minority interest                                               41              -          41
  Total equity                                                23,169            (50)     23,119

 30
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                               TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

  (2)     Reconciliation of profit under previous NZ GAAP to profit under
          New Zealand NZ IFRS


  (a)     Reconciliation of profit for the six months ended 30 June 2006

                                                                       Effect of
                                                   Previous NZ     transition to
                                             Notes       GAAP           NZ IFRS    NZ IFRS
                                                         $’000            $’000      $’000


  Revenue                                    (4)(b,e,g,l) 37,185         3,431     40,616

  Other income                               (4)(m)         144            (64)         80
  Goods sold out of inventories expense                 (16,039)             -     (16,039)
  Subcontracted services expense             (4)(l)           -         (2,052)     (2,052)
  Employee benefits expense                  (4)(a,c,g) (7,780)             55      (7,725)
  Property expense                                       (3,429)             -      (3,429)
  Other operating leases expense                           (354)             -        (354)
  Depreciation and amortisation expense                  (1,397)             -      (1,397)
  Impairment of goodwill                                    (22)             -         (22)
  Advertising expense                                    (1,233)             -      (1,233)
  Write back of claims and losses                             -              -           -
  Other expenses                             (4)(l,m) (2,728)           (1,276)     (4,004)
  Finance costs                              (4)(c)        (438)            (5)       (443)
  Total expenses                                         33,420          3,278      36,698
  Profit before income tax                                3,909             89       3,998

  Income tax expense                         (4)(n)      (1,356)            (29)    (1,385)
  Profit from continuing operations                       2,553              60      2,613

  Loss from discontinued operations                        (250)              -      (250)
  Profit for the period                                   2,303              60     2,363

  Profit attributable to minority interest                   23               -        23
  Profit attributable to members of
  Turners Auctions Limited                                2,326              60     2,386




                                                                                        31
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

  (b)     Reconciliation of profit for the year ended 31 December 2006

                                                                             Effect of
                                                        Previous NZ      transition to
                                                              GAAP            NZ IFRS            NZ IFRS
                                                  Notes       $’000             $’000              $’000

  Revenue                                         (4)(b,e,g,l) 70,548          6,884              77,432

  Other income                                    (4)(m)         158             (65)                 93
  Goods sold out of inventories expense                      (30,205)              -             (30,205)
  Subcontracted services expense                  (4)(l)           -          (3,938)             (3,938)
  Employee benefits expense                       (4)(a,c,g) (15,539)            168             (15,371)
  Property expense                                            (7,010)              -              (7,010)
  Other operating leases expense                                (696)              -                (696)
  Depreciation and amortisation expense                       (2,838)              -              (2,838)
  Impairment of goodwill                                         (18)              -                 (18)
  Advertising expense                                         (2,655)              -              (2,655)
  Write back of claims and losses                                417               -                 417
  Other expenses                                  (4)(h,l,m) (5,542)          (2,979)             (8,521)
  Finance costs                                   (4)(c)        (862)            (10)               (872)
  Total expenses                                              64,948           6,759              71,707
  Profit before income tax                                     5,758              60               5,818

  Income tax expense                              (4)(n)       (2,008)            (24)            (2,032)
  Profit from continuing operations                             3,750              36              3,786

  Loss from discontinued operations               (4)(f)        (628)             (77)              (705)
  Profit for the period                                        3,122              (41)             3,081

  Profit attributable to minority interest                        44                -                 44
  Profit attributable to members of
  Turners Auctions Limited                                     3,166              (41)             3,125

   (3)      Reconciliation of cash flow statement for the periods presented
   The adoption of NZ IFRS has not resulted in any material adjustments to the cash flow statement for
   the periods presented.

   (4)      Notes to the reconciliations
            (a)    Share-based payments
   The Group has granted options under an Executive Share Option Scheme. Under previous NZ GAAP
   no expense was recognised for the scheme as the share options were granted above the prevailing
   market price. Under NZ IFRS 2 Share-based Payment the Group is required to recognise an expense
   for any options that had not vested by 31 December 2006. The fair value of the options is spread over
   the period during which the options vest. The effect of this is:




 32
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

                                                                          Six months ended       Year ended
                                                                                  30 June      31 December
                                                                                     2006              2006
                                                                                    $’000             $’000
   Employee benefits expense                                                              5             18

                                                           1 January             30 June       31 December
                                                                2006                2006               2006
                                                               $’000               $’000              $’000

   Non-current provisions                                             -                   1               1
   Retained earnings                                                  -                  (5)            (18)
   Other reserves                                                     -                   4              17
           (b) Refundable insurance commission
   The Group received insurance commission which is partially refundable to the insurance provider if
   customers cancel their insurance contracts early. Under previous NZ GAAP this refund was recognised
   when the contract was cancelled. Under NZ IFRS, a provision is made for estimated future refunds
   when the insurance sale is made.
                                                                          Six months ended       Year ended
                                                                                  30 June      31 December
                                                                                     2006              2006
                                                                                    $’000             $’000
   Other services revenue                                                                 8             29

                                                           1 January             30 June       31 December
                                                                2006                2006               2006
                                                               $’000               $’000              $’000

   Current provisions                                              99                 91                 70
   Retained earnings                                              (99)               (91)               (70)

           (c) Long service leave
   Under previous NZ GAAP the Group recognised long service leave when it became due. Under NZ IFRS
   long service leave is recognised as it accrues. The provision is discounted according to the timing of
   future payments. The unwinding of this discount is included in finance costs.
                                                                 Six months ended        Year ended
                                                                      30 June 2006 31 December 2006
                                                                             $’000            $’000
   Employee benefits expense                                                   (18)             (16)
   Finance costs                                                                 5               10
                                                          1 January            30 June         31 December
                                                               2006               2006                 2006
                                                              $’000              $’000                $’000

   Non-current provisions                                       168                155                 162
   Retained earnings                                           (168)              (155)               (162)

                                                                                                         33
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

           (d) Forward exchange contracts
   The Group uses forward foreign exchange contracts to hedge against expected foreign currency
   purchases. NZ IFRS requires that the foreign exchange contracts be recognised on the balance sheet
   as an asset or a liability. Gains or losses on foreign exchange contracts are deferred in a cash flow
   hedge reserve in equity to the extent that the foreign exchange reserves qualify for and are effective
   as a hedge.

                                                            1 January          30 June       31 December
                                                                 2006             2006               2006
                                                                $’000            $’000              $’000

   Derivative financial assets                                    140                8                   -
   Derivative financial liabilities                                 -                -                  23
   Hedging reserve - cash flow hedges                             140                8                 (23)


           (e) Subscription revenue
   Under previous NZ GAAP the Group recognised subscription revenue when it became non refundable.
   Under NZ IFRS, subscription revenue is required to be spread over the life of the subscription, net of
   any provision for revenue expected to be refunded.

                                                                        Six months ended       Year ended
                                                                                30 June      31 December
                                                                                   2006              2006
                                                                                  $’000             $’000
   Other services revenue                                                           42                  56

                                                            1 January          30 June       31 December
                                                                 2006             2006               2006
                                                                $’000            $’000              $’000

   Deferred income                                                  67              25                  11
   Retained earnings                                               (67)            (25)                (11)


           (f) Foreign currency translation reserve on disposal
   Under previous NZ GAAP, on the disposal of the foreign operations, exchange differences arising from
   the translation of the net investments in the operations were transferred directly to retained earnings
   from the foreign currency translation reserve. Under NZ IFRS, such differences are recognised as part
   of the profit or loss on disposal.

                                                                        Six months ended       Year ended
                                                                                30 June      31 December
                                                                                   2006              2006
                                                                                  $’000             $’000
   Loss from discontinued operations                                                 -                  77




 34
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                    TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

           (g) Finance receivables acquisition costs
   Direct costs incurred in the creation of new finance receivables were expensed when they occured
   under previous NZ GAAP. Under NZ IFRS they are included as part of the carrying amount of the
   receivable and spread over the life of the loan on a yield to maturity basis.
                                                                      Six months ended      Year ended
                                                                              30 June     31 December
                                                                                 2006             2006
                                                                                $’000            $’000

   Interest income                                                               (11)             (141)
   Employee benefit expenses                                                     (42)             (170)

                                                          1 January          30 June      31 December
                                                               2006             2006              2006
                                                              $’000            $’000             $’000

   Current finance receivables                                   45               49                53
   Non-current finance receivables                               34               61                55
   Retained earnings                                             79              110               108


           (h) Finance receivables provision
   Under previous NZ GAAP, the Group carried a general provision against receivables for expected future
   losses. Under NZ IFRS provisions are only made when the receivable has suffered an impairment loss
   and are not made against receivables that have not yet shown any indications of impairment. General
   provisions for future losses in receivables are prohibited.

                                                                      Six months ended      Year ended
                                                                              30 June     31 December
                                                                                 2006             2006
                                                                                $’000            $’000

   Other expenses                                                                  -                  42



                                                          1 January          30 June      31 December
                                                               2006             2006              2006
                                                              $’000            $’000             $’000

   Current provision for finance receivables                     (50)            (31)                 (17)
   Non-current provision for finance receivables                 (28)            (47)                 (19)
   Retained earnings                                              78              78                   36




                                                                                                       35
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                     TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

           (i) Finance receivables fees received
   Fees received relating to the creation of finance receivables were spread over the life of the receivable
   and shown as deferred income under previous NZ GAAP. Under NZ IFRS they are included as part of
   the carrying amount of the receivable and spread over the life of the loan on a yield to maturity basis.

                                                            1 January           30 June      31 December
                                                                 2006              2006              2006
                                                                $’000             $’000             $’000

   Current finance receivables                                     (49)             (56)               (93)
   Non-current finance receivables                                 (66)             (70)               (99)
   Deferred income                                                (115)            (126)              (192)

           (j) Software
   Software was classified within fixed assets under previous NZ GAAP. Under NZ IFRS software is
   disclosed as an intangible asset.
                                                                         Six months ended      Year ended
                                                                                 30 June     31 December
                                                                                    2006             2006
                                                                                   $’000            $’000

   Depreciation                                                                    (631)            (1,302)
   Amortisation of software                                                         631              1,302

                                                            1 January           30 June      31 December
                                                                 2006              2006              2006
                                                                $’000             $’000             $’000

   Property, plant and equipment                                (3,466)          (3,818)            (3,582)
   Intangible assets                                             3,466            3,818              3,582


           (k) Bundled warranties
   Under previous NZ GAAP, when warranties were included in the sale price, a provision was made for
   estimated future claims. Under NZ IFRS a portion of the sale price is allocated to the warranty and
   spread over the life of the warranty. A provision is made only if the estimated future claims exceed
   the unrecognised revenue.
                                                            1 January           30 June      31 December
                                                                 2006              2006              2006
                                                                $’000             $’000             $’000

   Accurals                                                          -              (10)               (47)
   Deferred income                                                   -               10                 47




 36
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                    TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

           (l) Auction costs
   Previously, commission and other auction revenue was net of direct auction costs. Under NZ IFRS,
   commission and other auction revenue is net of amounts collected on behalf of third parties only.
                                                                      Six months ended      Year ended
                                                                              30 June     31 December
                                                                                 2006             2006
                                                                                $’000            $’000

   Commission and other auction revenue                                        3,392              6,940
   Subcontracted services expense                                              2,052              3,938
   Other expenses                                                              1,340              3,002

           (m) Bad debts recovered
   Under previous NZ GAAP bad debts recovered were shown as income. Under NZ IFRS, bad debts
   recovered are shown under expenses as a reversal of prior period over provisions.
                                                                    Six months ended        Year ended
                                                                            30 June       31 December
                                                                               2006               2006
                                                                              $’000              $’000

   Other income                                                                  (64)                  (65)
   Other expenses                                                                (64)                  (65)

           (n)    Deferred tax
   Under previous NZ GAAP income tax expense was calculated by reference to the accounting profit
   after allowing for permanent differences. Deferred tax was not recognised in relation to amounts
   recognised directly in equity. Under NZ IFRS deferred tax will be calculated using a “balance sheet”
   approach which recognises deferred tax assets and liabilities where there are differences between the
   accounting and tax value of balance sheet items.

                                                                      Six months ended      Year ended
                                                                              30 June     31 December
                                                                                 2006             2006
                                                                                $’000            $’000

   Income tax expense                                                             29                   24



                                                          1 January          30 June      31 December
                                                               2006             2006              2006
                                                              $’000            $’000             $’000

   Deferred tax asset                                             12              26                   42
   Retained earnings                                              58              29                   34
   Hedging reserve - cash flow hedges                            (46)             (3)                   8

                                                                                                        37
Turners Auctions Limited
Notes to the Financial Statements
30 June 2007 (continued)
                                                    TURNERS AUCTIONS LIMITED
Explanation of transition to
New Zealand equivalents to
IFRSs (continued)

           (o) Retained earnings
   The effect on retained earnings of the changes set out above are as follows:

                                                         1 January            30 June     31 December
                                                              2006               2006             2006
                                                   Notes
                                                             $’000              $’000            $’000

   Share-based payments                            (a)              -               (5)            (18)
   Refundable insurance commission                 (b)            (99)             (91)            (70)
   Long service leave                              (c)           (168)            (155)           (162)
   Subscription revenue                            (e)            (67)             (25)            (11)
   Finance receivables acquisition costs           (g)             79              110             108
   Finance receivables provision                   (h)             78               78              36
   Deferred tax                                    (n)             58               29              34
   Total adjustment                                              (119)             (59)            (83)




 38
Corporate Directory                   TURNERS AUCTIONS LIMITED



DIRECTORS
Michael R Dossor
Chairman
J Denham Shale
Non-executive Director
Grant R Graham
Non-executive Director
Craig F Harris
Non-executive Director


AUDITORS
PricewaterhouseCoopers, Auckland



BANKERS
ASB Bank Limited


SOLICITORS
Lee Salmon Long
Minter Ellison Rudd Watts
Russell McVeagh



SHARE REGISTAR
Computershare Investor Services Limited
Level 2, 159 Hurstmere Road, Private Bag 92119,
Takapuna, Auckland 1020

Telephone: 09 488 8700
Facsimile: 09 488 8787
Email: enquiry@computershare.co.nz
Website: www.computershare.co.nz



POSTAL ADDRESS
PO Box 112022, Penrose, Auckland,
New Zealand
Telephone: 09 580 9360
Facsimile: 09 580 9364
Email: invest@turners.co.nz



                                                           39
TURNERS AUCTIONS LIMITED           BRANCHES NATIONWIDE




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