I too would like to throw in my 2c to say that the analysis on...

I too would like to throw in my 2c to say that the analysis on this thread is good.

I'm with recko1 in taking a slightly more conservative approach to the numbers though.

If the whole JV impairment charge is written back it will be done so as the same amount. I don't think you can assume you are going to write off an amount, make a provision for it, then when you find out you don't need to, make a profit from it. Having said that though, these are strange times.

HOWEVER, the impairment will be tested again this half and if the liability still exists, the amount of the charge will be adjusted to reflect the potential for loss at the time. This will take into account the current fx rate of course.

I do believe that in due course, as we start the long hard journey up the cycle again, the impairment will be removed as CNP equity in SuperLLC improves. Thus, you could include it in long term NTA calculations if you are of the same opinion. If you believe that (contrary to history) things are never going to improve and we are destined for a lifetime of deflating asset prices and global financial Armageddon, then you might take a different view.

The question as to whether or not the impairment will be lifted this half really does remain to be seen. There is a chance that things could get worse on the accounts before they get better. I sometimes wish we had 1/4 accounting rules in Aus like the US.. it just gets the pain out of the way quicker.

Working out the current NTA is very, very hard and even with the most sophisticated approach there will be a huge margin of error.

If I had to distil the approach we have taken to CER down, it revolves around the safety margin between SP and NTA. I would put to you that, acknowledging the margin of error on NTA, this may be a better way of looking at things.

There is limited potential for the CER NTA to rise in the current half given the hedge exposure, asset price drop and black-box association with CNP.

However, no matter which way you cut and dice CER the current NTA is significantly above the current share price... even taking the worst case scenario... and the potential for the NTA to rise over time is very good.

Put simply, the difference between NTA (whatever it is) and SP provides a safety margin to an investor for the coming months. In time, so long as the shopping centre industry is not destined for destruction, history proves that the market revalues companies based upon their earnings potential or liquidation (essentially NTA) value.

The issue we face is sentiment based, which if you are a long-term value investor who has an appetite for this sort of thing, actually works in your favour. As the SP drops, people bail - it's a well know market phenomenon. So long as you are comfortable with your safety margin and aren't on margin lending or need the money quick-smart, then a long term hold will probably reward you.

If someone is offering to sell you CER stock at way below your NTA calculation, you have one of three options - join them and sell, ignore them or pick a point and buy from them.

Research suggests that there are very few people who can consistently pick entry and exit points on stocks which deliver LONG TERM returns that outperform 'buy cheap stocks with a good safety margin and hold' strategies. This seems to run contrary to popular belief of course because you often hear about the winning trades, but rarely about the losing ones or the total transaction costs of executing the strategy. If you are one of these successful people, my congratulations go out to you as you are a statistical exception and probably very wealthy.