that films must be refused classification if they contain:

descriptions or depictions of child sexual abuse or any other exploitative or offensive descriptions or depictions involving a person who is, or appears to be, a child under 18 years; gratuitous, exploitative or offensive depictions of: … cruelty or real violence which are very detailed or which have a high impact; sexual violence,”  Richard Egan said. 

“The young captives in Salo who were sexually abused, raped, tortured and forced to eat excrement were portrayed as being under the age of 18.  One of the actors was only 17 when the film was made.”

The Classification Review Board decision to overturn the ban, like the Classification Board decision last month, was not unanimous.   Both boards claimed that the new Salo DVD’s inclusion of additional material explaining the film’s background would mitigate the impact on the viewer.

“This claim doesn’t make sense,” Richard Egan said.  “Even Salo supporters concede that additional material on a DVD usually goes unwatched – so it would not affect the extreme impact on the viewer of certain scenes in the film.”

The Review Board suggested that the consumer advice on the film – that it contains “scenes of torture and degradation, sexual violence and nudity” – would prevent viewers from seeing the DVD if they are likely to be offended by it.

“Offensiveness is not the issue,” Richard Egan said.  “This consumer advice could act as an inducement to paedophiles or others who take pleasure in viewing the extreme degradation of others.  Yesterday’s Review Board ruling has set a very dangerous precedent.”
……………………..
FamilyVoice Australia        www.fava.org.au
A Christian voice for families, faith and freedom

The video, for Derty Sesh’s second single, Forever, was pulled from YouTube by Move The Crowd Records this week, at the same time the censor’s office began a classification process for the video.

For more see NZPA Report:

http://www.stuff.co.nz/entertainment/music/3542326/Derty-Sesh-exhausted-from-backlash

The video for rapper Derty Sesh’s second single, Forever, has been pulled from YouTube by Move The Crowd Records.

Interested parties, including Move the Crowd Records, Rape Prevention Education, the Society for the Promotion of Community Standards and the Department of Internal Affairs, were yesterday invited to make comments on the video.

They would be given two to three weeks to make comments before they were considered by the Censor’s Office and classified.

For more see: http://www.stuff.co.nz/entertainment/music/3533304/Graphic-hip-hop-video-taken-down

As the Sunday Star-Times reported in the weekend: “An extended, online version of the video for Nathan King’s second single “Forever” depicts the rapper, who performs under the name “Dirty Sesh”, crouching over a bound woman with a knife to her head, before stabbing her in a frenzy and cutting out her organs. The clip, which features shots of mutilated women’s bodies and body parts, then segues into the television version of the video, which shows the rapper stalking a young couple in a park, dispatching the boyfriend, then driving the woman to a secluded hut. The television version ends with the woman screaming as the hooded rapper appears; in the online version, he assaults her.”

http://www.stuff.co.nz/sunday-star-times/news/3517368/Mike-Kings-son-in-horror-splatter-video-storm

Murdered boy endured final weeks of torture
Saturday May 16, 2009
By Beck Vass

….. For the seven days before Duwayne Pailegutu died, he was kept inside his mother and stepfather’s small flat in Nelson – so no one could see he had been beaten so badly he was paralysed, incontinent, and slowly suffocating on his own blood.

The left side of his body was disabled after repeated blows to the right side of his head which caused a stroke, and he struggled to eat or drink.

In addition to the haemorrhage, an autopsy found at least 10 deep bruises to his scalp – some of them inflicted by the shoes of his stepfather as the little boy cowered in the corner of his Fergusson St bedroom.

A further 75 bruises were found over the rest of his small body.

For the week before he died, Duwayne sat, partially paralysed and fitted with nappies, slowly suffocating on blood which he inhaled into his lungs as he vomited during “exercises” in which his stepfather made repeated blows to his stomach to make him cough up blood.

In an attempt to “shock” Duwayne into movement, Joachim dipped his paralysed foot into boiling water, leaving the largest of four scald wounds on his right leg……

When he became frustrated that Duwayne could not move, Joachim threw him against a wall.

And for the six weeks before his death on July 2 last year, Duwayne had been living with three broken ribs.

For full report: see:

http://www.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=10572666

The Society was today granted leave by the Secretary of Internal Affairs, Mr Brendan Boyle, to apply to the Film and Literature Board of Review to review the classification of the computer game Grand Theft Auto IV (unedited US version). The game was classified R18 by the Chief Censor’s Office.

The Secretary acknowledges in his decision dated 21 July that he received the Society’s application seeking leave, on 27 May 2008 and states in par 18-20:

“I found no evidence in the application to suggest that it was vexatious … I then considered whether the application for leave was frivolous (trivial, needless or unfounded, or so untenable that it could not succeed) under the Guidelines… I found that the application for leave from the SPCS appeared to be tenable in that it could possibly succeed. The application was therefore not frivolous. It is also my view that the SPCS has established an arguable prima facie case for the application to be considered by the Board.” (Full decision available http://www.dia.govt.nz).

The film “End of the Spear” has had its classification downgraded from R16 to R13 following a successful appeal by the Society against the classification decision issued by the Chief Censor’s Office. The Society contended in its written and oral submisssion to the Board that the nature of the depiction of violence in the film – medium level violence – could not possibly justify an R16 classification. The nine member Film and Literature Board of Review agreed and in a unanimous decision, issued to the Society on Wednesday this week, took the view that 13, 14 and 15 year old children would not be harmed by exposure to the violence which formed only a small part of a compelling Christian message of forgiveness and redemption that is told based on the “true story” of the missionary outreach in the 1950s, to the violent South American Waodani Indian tribe. A revised censor’s note from the Board, alerts viewers to the medium level violence involving tribal warfare that some might find “disturbing”.

This is the second successful appeal by the Society in recent years involving a major Christian film that has led to its classification rating – issued by the Chief Censor’s Office – being downgraded by the Board. The Society made both oral and written submissions to the Board to overturn the R16 classification of Mel Gibson’s blockbuster film “The Passion”, and this led it to being reclassified R15. The applicant in this case was the film’s distributor and the Society opted to take a role as an interested party.

The Society has as one of its six objectives: the promotion of freedom of expression, within the boundaries of good law that safeguards the public good from injury.

Society president John Mills is very angry and says: “In the Silent Screams DVD promoted on our Society’s website (www.spcs.org) an unborn child is torn apart without anaesthetic. Someone needs to be held to account for such brutal murders carried out every day in New Zealand with taxpayers’ funding. By far the most dangerous place to be in New Zealand is inside your mother’s womb. I expect the anti-smacking brigade, who are so opposed to child abuse, would wholeheartedly agree with me on this issue!”

Angry women’s health advocates such as Women’s Health Action Trust director, Jo Fitzpatrick, and Family Planning chief executive, Jackie Edmond, are quoted in today’s NZPA report (Dom Post 11/06), as rejecting anti-abortion lobbyists’ claims that New Zealand effectively has “abortion on demand”. And yet this is exactly what a High Court judge’s ruling, made public yesterday, suggests, and backs up what Dr Christine Forster, Chairperson of the Abortion Supervisory Committee (ASC) has conceded.

“Certifying consultants were using mental health grounds to provide abortion on demand and that she did not believe that all these had a mental health problem”. (Front page article Sunday Star Times in November 2000)

Fitzpatrick says that Dr Foster’s claim, put before the Court by Right to Life in a High Court judicial review of the actions of the ASC, is “ridiculous”. However, Justice Forrest Millar did find that the ASC has a statutory duty to hold consultants accountable for the lawfulness of the approximately 18,000 abortions that they authorise each year, 98% of which are authorised on mental health grounds. He cast doubt on the legality of many of the abortions authorised on such grounds, when he stated:

“There is reason to doubt the lawfulness of many abortions authorised by certifying consultants. Indeed, the Committee itself has stated that the law is being used more liberally than Parliament intended.”

The Society for Promotion of Community Standards (SPCS) challenges Edmond and Fitzpatrick and other pro-abortion lobbyists to correct their falsehoods and apologise to the nation for promoting a shocking culture of death (since 1991, the number of 11-14 year olds having an abortion has increased by 144%. The number of abortions for 15-19 year olds has increased by 74%. Each week, almost 80 teenagers have an abortion, and represent almost a quarter of all abortions performed in NZ).

New Zealand’s present abortion laws are based around the 1977 Abortion, Contraception and Sterilisation Act.. This law does not confer or recognise a legal right to life for an unborn child until that child is born and considered a person. Abortions can only be granted on the grounds of serious damage to the mother’s life or health. However, New Zealand has ratified the United Nations Convention of the Rights of the Child (UNCROC) that does recognise the rights of the unborn and the legal obligation of states to protect such individuals.

Millar J. ruled that the ASC had failed to use its powers under the law – powers to review or scrutinise the decisions of certifying consultants. The Committee is responsible for reviewing all the provisions of the abortion law, and the operation and effect of those provisions in practice and has failed to fulfil its statutory duties. To try and justify its failures to implement the law, the ASC has been using, what has been determined by the Court to be a misinterpretation of case law on s187a of the Contraception, Sterilisation and Abortion Act, which states an abortion can only be done if it affects the life or health of the women. The Courts have now instructed the ASC that the law must be applied consistently, to the letter of the law, not some liberal interpretation of it. [Ref. 1]

The full judgement of the High Court is here [PDF]

Ref 1. Source. Helpful analysis see. 

.

THE SOCIETY FOR PROMOTION OF COMMUNITY STANDARDS INC.

P.O. Box 13-683 Johnsonville

http://www.spcs.org.nz

Submission to:

Mr Brendan Boyle

Secretary of Internal Affairs

Department of Internal Affairs

Wellington

28 May 2008

Re: Grand Theft Auto IV (unedited US version) [also known as or GTA 4].

The Society has sought leave under s. 47(2)(e) of the Films, Videos, and Publications Classification Act 1993 (“the Act”), to apply to the Film and Literature Board of Review (“the Board”) for a review of the classification of the highly controversial console game Grand Theft Auto IV (unedited US version) [also known as or GTA 4]. As noted in our application for leave dated 27 May 2008, the unedited game was classified R18 by the Office of Film and Literature Classification (“the OFLC”) on the 21^st May 2008.

An earlier version of this game was also classified R18 by the OFLC in a decision dated 27 February 2008 (OFLC 800191). The OFLC has chosen not to release that full decision on its website, as it has done for the controversial R18 book – The Peaceful Pill Handbook. However, the Society has obtained a copy of the OFLC decision for the edited GTA4 publication and has published it on its website so that the public can be alerted to the vile, toxic, pernicious and “crime-promoting” (to quote the Dominion Post) content in this game.

See: http://www.spcs.org.nz/2008/chief-censors-office-report-on-grand-theft-auto-2/

Take 2 Interactive Software distributes the edited version of the game in New Zealand:

See: http://www.spcs.org.nz/2008/grand-theft-auto-iv-who-is-the-nz-distributor-profiting-from-this-offensive-crime-promoting-game/

The Society wishes to set out some of our reasons for seeking a reclassification of the unedited version of console game. In summary it contends that:

1) A prima facie case for a reclassification of the publication can be established,

2) Relief Sought by Society: The game should be classified “objectionable” under ss. 3(2)(f), 3(3)(a)(i), s3(3)(d) and 3(4)(a)-(f) of the Act.

3) Professional agencies and senior qualified experts working in the field of youth crime, “at-risk” youth (15-17) and young adults (18-24 years), mental health services and Police Legal Services and drug law enforcement, should be asked by the Board of Review to make submissions on the classification of this “crime-promoting” console game, in the light of the acknowledged potential of the book to influence vulnerable at-risk individuals to commit criminal acts. The New Zealand Prostitutes Collective should also be consulted with regard to the game’s treatment of prostitutes.

4) It is in the public interest for a thorough review of the classification of this game to take place.

Introduction:

GTA 4 is a console game formatted for play on the Xbox 360 console. The game is the latest instalment in a series of popular free roaming, or open-ended, games from the development company Rockstar Games. The game is plot-driven, broadly fitting into the action/drama. It tells the story of Nico Bellie, a fresh-off-the-boat Eastern European immigrant to Liberty City (modelled on the real New York city). Nico stays with his cousin Roman, a loser with dangerous levels of gambling debt, and begins to perform odd jobs to keep his head above water. Nico’s ulterior motive in visiting Liberty City is to try and find the man responsible for betraying his friends.

As with the previous versions of Grand Theft Auto the game utilises a third-person perspective. The storyline is progressed through cinematic scripted sequences, and supported by a wide range of mission objectives that draw the player into a vortex of criminal activity and morally repugnant corrupt activity. The game world is immersive and fully realised. It is deliberately designed to entice the player into deeper and deeper levels of criminal activity but does draw the line by not allowing the player to dismember his victim’s body, commit sexual acts on the body or sexually exploit young people. However, innocent victims can be incinerated, garrotted to death, repeatedly abused using vile obscenities, demeaned, degraded and dehumanised. The objectification of women as sexual objects to be used and degraded and disposed of is evident as a subtext, if not as a more overt message.

The unedited version of the Grand Theft Auto IV (GTA 4) game differs from the edited version in a number of features including the more explicit content contained in the sex scenes involving prostitutes. Players are able to manipulate the main character allowing him to visit brothels, etc. engage in sexual acts with prostitutes and then kill them using a range of techniques, including garrotting them. Innocent victims can be disposed of by incineration using a Molotov cocktail. The audio and visual presentation of the sex scenes are graphic and gratuitous – utilising camera angles and sound effects one would expect to see in large budget films. Some games experts, reporting in reviews on overseas websites, have described the visual quality, when using high definition screens, as better than large budget films.

It has been reported that the OFLC has expressed little concern over this gratuitous sexual content of the game, for the reason that “no genital contact” is actually portrayed. However, the Society asks the OFLC: Since when did genital content become the proverbial line-in-the-sand defining what is “objectionable” in sexual contact? Such content is a regular feature of the many hundreds of sexually explicit DVDs and videos that are classified as R18 by the OFLC for the home entertainment market. Such content is also found in films depicting sexual violence (rape) and sodomy, cleared for the cinema screen by Chief Censor, Mr Bill Hastings (e.g. the French film Baise-Moi, transl. Fu#k Me)

Subject Matter Gateway

Matters such as sex

One of the many strong in-game violence scenes occurs when a person is hit by a Molotov cocktail. The victim is shown running to and fro on fire before collapsing. The level of cruelty is stronger because of the length of time it takes for the person to die. This is clearly designed to titillate the gamer as the length of depiction is over-the-top (gratuitous). Liberal critics have called it sickening, lurid and pornographic.

The scripted sequences also feature a range of violence, such as people being shot in the head with the contents spewing our n all directions. These are shown in a very cinematic way, utilising camera angles and sound effects one would expect to see in large budget films that glamorise violence (eg. Kill Bill: Volume 1).

In terms of s3(2)(f) “…. infliction of extreme violence or extreme cruelty”…. the game rewards players for engaging in criminal activity that involves such extreme activities. The freedom players are given to repeat such atrocities and the nature of the reward system has the potential to promote sado-masochism, violence, sexual violence and perversions, the abuse of women etc.

In terms of s3(3)(d) the game contains the potential for anti-social and criminal behaviour through the freedom Niko has to hijack cars and kill civilians and police with an array of offensive weapons. The missions themselves also involve Niko performing criminal behaviour, such as shakedowns of business owners who refuse to pay protection money, and killing other criminals. The criminal behaviour is the main focus of the game.

The power the police have to kill or arrest is a legitimate power invested in them by the state, although it is subject to review processes etc. These are not unfettered powers and police are sworn members of an agency of government empowered to uphold the law in a democratic state. In contrast, the player is encouraged to wantonly breach the criminal law and commit acts that are crimes against persons and property. Furthermore, this is done to entertain, titillate and amuse the player.

3A Publication may be age-restricted if it contains highly offensive language likely to cause serious harm.

The publication contains frequent use of coarse language in keeping with the characters’ backgrounds. Examples include use of word “f#ck” and its derivatives (“mother-f#cker” etc), and the word “cu#t”. This constant stream of obscenities advances misogyny and demeans, degrades and dehumanises women in particular.

Section 3(4) Additional matters to be considered

s3(4)(a) The dominant effect of the publication as a whole

The dominant effect of the publication as a whole is to titillate, entertain and engage players within the mindset of an action drama that glamorises: criminal activities, the infliction of extreme violence or extreme cruelty, drug-taking, the killing of law enforcement officers and innocent members of the public etc.

s3(4)(b) The impact of the medium in which the publication is presented

The highly interactive nature of a Xbox 369 console game, allowing for complex and sophisticated game-play with realistic graphics and sound effects, combined with its pernicious crime-promoting character – will impact significantly on the minds of young adults in particular, as well as adults, who have a propensity for criminal behaviour and enjoy engaging in anti-social behaviour.

s3(4)(c) The character of the publication, including any merit, value or importance it has in relation to literary, artistic, social, cultural, educational, scientific, or other matter.

The publication has no merit and is injurious to the public good.

s3(4)(d) The persons, classes of persons, or age groups of the persons to whom the publication is intended or is likely to be made available.

The publication is aimed at young adult gamers; in the sure knowledge of its makers that it will be accessed by many male youths below the age of 18 years. Its depictions of violence and cruelty, offensive and gratuitous sexual content, and criminal anti-social elements, are all designed to inject a high-level of excitement into the game programme that appeals, in particular to young men and boys.

s3(4)(e) The purpose for which the publication is to be used

The publication is intended as entertainment.

BILL OF RIGHTS CONSIDERATIONS

Discussion of Bill if Rights Consideration

Section 3(1) considerations have been weighed against relevant provisions of the NZBR Act. Given the manner in which the game treats matters of extreme violence, extreme cruelty and criminal activities, the classification imposed on this game – as objectionable – is a reasonable limitation on the freedom of expression contained in the Bill of Rights, and is demonstrably justified in a free and democratic society. Any limitation on the console game’s availability to minimum age restrictions would be pointless and largely ineffective. Research has shown that earlier versions of Grand Theft Auto that have been rated R18, have all been regularly played and accessed by tens of thousands of New Zealand young men, well under the age of 18 years. A total ban on GTA4 (unedited version) would prevent injury to the public good.

Conclusion

Injurious to the Public Good

The banning of this publication that is so injurious to the public good is well justified given the manner in which it deals with matters of violence, cruelty and crime. The potential for the player’s character to commit numerous gratuitous acts of violence upon unsuspecting members of the public and the police, as well as frequently engage in extreme acts of anti-social and illegal behaviour, demonstrates that it has no merit whatsoever in a democratic society. This kind of pernicious content would be welcomed by those seeking to train people in the mindset of criminal activity, but it has no redeeming value for New Zealand society. The game has the very real potential to desensitise or inure over the long term, vulnerable minds to this type of criminal and anti-social behaviour, and trivialises crime, promiscuity and perversions through presenting it them amusing, sexually titillating or exciting. The likelihood of injury to the public good is avoided by banning this game.

Society for Promotion of Community Standards Inc.

Cc. Mr Owen Davie, Board of Review Secretary and Peter McKenzie QC

The classification decision Issued by the Office of Film and Literature Classification on GTA4 (unedited) can be viewed at:

The computer game’s distributor, the applicant to the FVLB, recorded on the application form, its identity as “TAKE 2 INTERACTIVE”. All other details relating to the company were deleted from the form by the Chief Censor, Bill Hastings, when he provided the application form to the Society, in response to its Official Information Request (OIR). The applicant’s contact person, return street address for the publication and contact telephone number, were all deleted.

The Society Investigates……..

The Society has been calling for the Grand Theft Auto game series to be banned since an earlier version was released onto the NZ market (See article by Fran Tyler “Crime-Promoting Game Sells Fast, Dominion Post 17/11/02, A12). Lack of disclosure from the Chief Censor’s Office regarding the details of the game’s version 4 distributor, has prompted the Society to do some quick research on the company ………

Here are some initial findings.

The full Company name of the New Zealand distributor of the Grand Theft Auto IV is TAKE 2 INTERACTIVE SOFTWARE PTY LTD, New Zealand Branch. It is a branch of its overseas controlling company, one that is incorporated in Australia with an official name of TAKE 2 INTERACTIVE SOFTWARE PTY LTD. The latter is controlled by a Swiss Company that is itself controlled by the parent company based in the US (see details in Appendix below).

The New Zealand Companies Website (www.companies.govt.nz) indicates that the NZ distributor of Grand Theft Auto IV was registered as a Company (No. 1100292). in New Zealand on the 6^th of November 2000 and its principal place of business is listed as Unit M, 86 Bush Road, Albany, Auckland (website record entry dated 23 May 2007). The person authorised to “accept service” in New Zealand on behalf of the Australian-based company, is Mr John Gray C/- Ross Melville PKF, Level 5. 50 Anzac Ave, Auckland 1010. The current NZ Branch Directors are listed as Michael Chow of 18 Headland Road, Castle Cove NSW 2069, Australia and Daniel Emerson, 109 Puritan Drive, Port Chester NY 10573, United States and by law must also be directors of the Australian controlling company. Both were appointed as directors on the 8^th of September 2007 on the same day that former Company directors Emmanuel Bohlock and James Ellingford resigned.

On the 30^th of March 2007, Bohlock and Ellingford and the Company’s auditor, Margaget van Aanholt, signed the NZ Branch 2006 Financial Statements (covering the period 1 November 2005 to 31 August 2006). However, it was not until eight months later, on the 26th of November 2007, that the documents were finally filed with the Companies Office. The directors were obligated under the Financial Reporting Act 1993 to file them within 20 working days of signing them off. However, they were filed almost 7 months after the due date and two months AFTER Bohlock and Ellingford had resigned as directors on September 8th 2007 – replaced by new directors, Michael Chow and Daniel Emerson, were appointed.

Section 10 of the Financial Reporting Act 1993 required that the directors file these documents NO LATER than 5 months and 20 working days after the balance date of 31st October 2006 – that is NO LATER than the 3rd of May 2006 (see ref. 3).

In a letter to the Society dated 5 May 2008, in response to the Society’s OIR concerning Grand Theft Auto IV, the Chief Censor wrote:

“The Film and Video Labelling Body Inc also submitted to the Classification Office [to accompany the publication Grand Theft Auto IV] a copy of the submission made by the game’s Australian applicant to the Australian Government Classification Board. This submission relates “to the classification of this publication”. This submission is however marked “confidential” and contains commercially valuable information. Under section 18(a) of the Official Information Act 1882, I therefore refuse your request because the information requested is subject to an obligation of confidence where the making available of the information would be likely to prejudice the supply of similar information, or information from the same source, and it is in the public interest that the information should continue to be supplied, and because the making available of the information would be likely unreasonably to prejudice the commercial position of the person who supplied the information. [Emphasis added]

“You have the right, by way of complaint to an Ombudsman under section 28(3) of the Official Information Act 1982 to seek an investigation and review of this refusal.”

The Society has lodged a formal complaint with the Office of the Ombudsman over the refusal of Mr Bill Hastings to release this information to the Society. It contends that it is in the “public interest” for the submission on Grand Theft Auto IV received by the OFLC from the game’s Australian applicant to the Australian Government Classification Board, be released. Furthermore, it contends that any genuine commercially sensitive information, such as sales figures projections etc, could have easily been deleted by the applicant, prior to its release of the submission to the SPCS. Furthermore, it is asking that the Ombudsman investigate the nature of the so-called confidentiality agreement that Mr Hastings claims he has entered into with the game’s Australian applicant (and/or the New Zealand or Australian distributor).

The Society asks: Why is TAKE 2 INTERACTIVE so sensitive about the release of its New Zealand contact details, in view of the fact that Grand Theft Auto IV is advertised as being advertised in NZ as the Number 1 selling computer game in the world and the “coolest game ever made”.

Why would the Company distributing such a popular and commercially successful game request that Chief Censor Bill Hastings and Bill Hood, Executive Secretary of the FVLB, withhold its contact details from the SPCS?

As noted, TAKE INTERACTIVE last filed it audited Financial Statements with the New Zealand Companies Office on 26 November 2007 – LATE – and these were for the financial year 1 November 2005 to 31 October 2006. Its audited Financial Statements for the year ending 31 October 2007, that were required to be filed with the Companies Office NO LATER THAN the 29th of April 2007, have not yet been filed. Again Company Directors have a legal obligation to have these accounts filed by the due date (see ref. 3).

Audited Financial Accounts that have been filed show that that the New Zealand Branch of TAKE 2 INTERACTIVE had a sales revenue in the 2005/2006 financial year of $5,350.639 that together with interest revenue of $1,617, gave it a total yearly operating revenue of $5,352,256. Taking account of annual operating expenses of $5,287,737, this gave it an operating surplus before income tax of $64,519. Subtracting income tax of $27,797, gave it an operating surplus of $36,722.

The balance of the account at the beginning the year (1/11/05) was $237,209 and this amount combined with the net profit for 2006 (or operating surplus) of $36,722, gave an end of year (31/10/06) balance of the accounts of $273,931 (the latter figure derived from net profit of $36,722 + balance of $237,209 as at 1/11/05)

The only financial disclosures relating to the annual operating expenses of $5,352,256 that are provided in the 2005/2006 Financial Accounts are given in note 3: $29,023 (Cost of offering credit: bad and doubtful debts), $6,384 (Fees for audit services) and fees for taxation services ($13,186). The total amounts to only $48,593 – a mere 0.96% of total operating expenses. It appears that the NZ Branch directors of Take 2 Interactive have cited Section 211(3) of the Companies Act 1993 to justify the absence of financial disclosure with respect to $5,303,663 of operating costs. ALL Shareholders would have had to have formally agreed with such omissions from the Financial Statements for them to be legal under the Act. The Companies Office told the SPCS it was unable to disclose any information concerning this lack of financial disclosure.

http://www.companies.govt.nz/scanned-images/71/BC10054448471.pdf

Goods amounting to $4,568.795 (2005: $5,689,297) were purchased from the New Zealand Branch’s controlling company based in Australia – Take 2 International Software Pty Limited – during the financial year ending 31 October 2006. As that balance date the Branch owed the controlling company $806,383 for goods purchased (2005:$1,080,346).

The gross profit from sales by the Australian controlling company for the year ending 31 October 2006 was $10,453,067. Its net assets are recorded as $5,927,590 and total liabilities are $7,646,429. The total receipts from customers was $38,567,136 and the profits attributable to the entity after providing for income tax was $949,282.

These results contained in the Financial Statements for 2005/2006 were signed off by one director, Emmanuel Bohlock, and the auditor, Margaret van Aanhold, on the 1st of June 20007 and then filed with the NZ Companies Office on 26 November 2007, two months after Bohlock and fellow-director James Ellingford had resigned. Bohlock signed the Director’s report on behalf of his fellow directors Ellingford and Ashish Solanki. “Key Management Personnel Compensation” is given as $868,657 (2005:$827,868).

Appendix

A “Summary of Significant Accounting Policies” contains Note 10 “Party Related Disclosures” to the NZ Branch’s Financial Accounts (2006), states:

“The controlling company of Take 2 Interactive Software Pty Limited, New Zealand Branch, is Take 2 Interactive Software Pty Ltd, a company incorporated in Australia.

“The immediate controlling company of Take 2 Interactive Software Pty Limited is Take-Two International SA, a company incorporated in Switzerland.

“The ultimate controlling company of Take 2 Interactive Software Pty Limited is Take-Two Interactive Software Inc. a company incorporated in the United States of America.”

Note 1 states:

“The [New Zealand] Branch is a qualifying entity within the Framework of Differential Reporting. The Branch qualifies on the basis that it is not publicly accountable and Take 2 Interactive Software Pty Limited is a wholly owned subsidiary of Take-Two International SA, (Company incorporated in Switzerland).”

1. US game sales rise 47PC in April on GTA4. ReutersFriday, 16 May 2008

http://www.stuff.co.nz/4550995a28.html

2. Grand Theft Auto hailed as ‘masteroiece’ Reuters 29 April 2008.

http://www.stuff.co.nz/4501898a1860.html

3. Section 19 (3) of the Financial Reporting Act 1993 states:

 The directors of every company to which this section applies [Overseas Companies] must—

• (a) ensure that, within 20 working days after the financial statements of the company and any group financial statements in relation to a group comprising that company and its subsidiaries are required to be signed, copies of those statements, together with a copy of the auditor’s report on those statements, are delivered to the Registrar for registration; and

• (b) ensure that the company pays to the Registrar the prescribed registration fee at the same time.