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Note 2 - Significant Accounting Policies
 12 Months Ended
Dec. 31, 2016
Notes to Financial Statements  
Significant Accounting Policies [Text Block]
2
- Significant Accounting Policies
 
A.
Basis of Accounting
 
The following significant accounting policies are consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The preparation of financial statements in conformity with U.S. GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates.
 
Certain statements and captions in the financial statements for the prior years have been changed to conform to the current financial statement presentation.
 
B.
Gold Bullion
 
JPMorgan Chase Bank N.A., London branch (the “Custodian”), is responsible for the safekeeping of gold bullion owned by the Trust.
 
Fair value of the gold bullion is based on the price of gold determined in an auction hosted by ICE Benchmark Administration (the “IBA”) in the afternoon (London time), on each day that the London gold market is open for business, and announced by the London Bullion Market Association shortly thereafter (such price, the “LBMA Gold Price PM”). If there is no announced LBMA Gold Price PM on a business day, the Trustee is authorized to use the most recently announced price of gold determined in an auction hosted by the IBA in the morning (London time) of the day the valuation takes place (such price, the “LBMA Gold Price AM”).
Prior to
March
20,
2015,
fair value of the gold bullion was based on the price of gold fixed in the afternoon of each working day (London time) by the London Gold Market Fixing Ltd. (the “London PM Fix”). If there was no announced London PM Fix, the Trustee was authorized to use the most recently announced price fixed by the London Gold Market Fixing Ltd. in the morning (London time) of the day the valuation took place (the “London AM Fix”).
 
Gain or loss on sales of gold bullion is calculated on a trade date basis using the average cost method.
 
The following tables summarize activity in gold bullion for the years ended
December
31,
2016,
2015
and
2014:
 
December 31, 2016
 
Ounces
 
 
Average
Cost
 
 
Fair
Value
 
 
Realized
Gain (Loss)
 
Beginning balance
    
4,905,568
     $
5,910,175,908
     $
5,210,940,144
     $
—
  
Gold bullion contributed
    
3,036,655
      
3,784,339,342
      
3,784,339,342
      
—
  
Gold bullion distributed
    
(1,618,237
 )    
(1,968,318,439
 )    
(1,992,755,088
 )    
24,436,649
  
Gold bullion sold to pay expenses
    
(15,924
 )    
(19,273,468
 )    
(19,905,623
 )    
632,155
  
Net realized gain
    
—
      
—
      
25,068,804
      
—
  
Net change in unrealized appreciation/depreciation
    
—
      
—
      
303,987,270
      
—
  
Ending balance
    
6,308,062
     $
7,706,923,343
     $
7,311,674,849
     $
25,068,804
  
 
 
December 31, 2015
 
Ounces
 
 
Average
Cost
 
 
Fair
Value
 
 
Realized
Gain (Loss)
 
Beginning balance
    
5,182,164
     $
6,254,868,124
     $
6,214,710,412
     $
—
  
Gold bullion contributed
    
696,554
      
830,130,993
      
830,130,993
      
—
  
Gold bullion distributed
    
(959,873
 )    
(1,158,780,335
 )    
(1,071,599,347
 )    
(87,180,988
 )
Gold bullion sold to pay expenses
    
(13,277
 )    
(16,042,874
 )    
(15,431,681
 )    
(611,193
 )
Net realized loss
    
—
      
—
      
(87,792,181
 )    
—
  
Net change in unrealized appreciation/depreciation
    
—
      
—
      
(659,078,052
 )    
—
  
Ending balance
    
4,905,568
     $
5,910,175,908
     $
5,210,940,144
     $
(87,792,181
 )
 
December 31, 2014
 
Ounces
 
 
Average
Cost
 
 
Fair
Value
 
 
Realized
Gain (Loss)
 
Beginning balance
    
5,220,493
     $
6,272,422,250
     $
6,272,422,250
     $
—
  
Gold bullion contributed
    
466,018
      
590,756,513
      
590,756,513
      
—
  
Gold bullion distributed
    
(491,071
 )    
(592,311,684
 )    
(605,981,738
 )    
13,670,054
  
Gold bullion sold to pay expenses
    
(13,276
 )    
(15,998,955
 )    
(16,697,643
 )    
698,688
  
Net realized gain
    
—
      
—
      
14,368,742
      
—
  
Net change in unrealized appreciation/depreciation
    
—
      
—
      
(40,157,712
 )    
—
  
Ending balance
    
5,182,164
     $
6,254,868,124
     $
6,214,710,412
     $
14,368,742
  
 
C.
Calculati
on of Net Asset Value
 
On each business day, as soon as practicable after
4:00
p.m. (New York time), the net asset value of the Trust is obtained by subtracting all accrued fees, expenses and other liabilities of the Trust from the fair value of the gold and other assets held by the Trust. The Trustee computes the NAV by dividing the net asset value of the Trust by the number of Shares outstanding on the date the computation is made.
 
D.
Offering of the Shares
 
Trust Shares are issued and redeemed continuously in aggregations of
50,000
Shares in exchange for gold bullion rather than cash. Individual investors cannot purchase or redeem Shares in direct transactions with the Trust. The Trust only transacts with registered broker-dealers that are eligible to settle securities transactions through the book-entry facilities of the Depository Trust Company and that have entered into a contractual arrangement with the Trust and the Sponsor governing, among other matters, the creation and redemption of Shares (such broker-dealers, the “Authorized Participants”). Holders of Shares of the Trust
may
redeem their Shares at any time acting through an Authorized Participant and in the prescribed aggregations of
50,000
Shares;
provided
, that redemptions of Shares
may
be suspended during any period while regular trading on NYSE Arca, Inc. (“NYSE Arca”) is suspended or restricted, or in which an emergency exists as a result of which delivery, disposal or evaluation of gold is not reasonably practicable.
 
The per Share amount of gold exchanged for a purchase or redemption represents the per Share amount of gold held by the Trust, after giving effect to its liabilities. The Trustee calculates the gold amount in respect of any liabilities of the Trust daily using the LBMA Gold Price PM. If there is no announced LBMA Gold Price PM on a business day, the Trustee is authorized to use the most recently announced LBMA Gold Price AM. Prior to
March
20,
2015,
the Trustee used the London PM Fix price to calculate the gold amount in respect of any liabilities. If there was no announced London PM Fix on a business day, the Trustee was authorized to use the most recently announced London AM Fix.
 
When gold bullion is exchanged in settlement of a redemption, it is considered a sale of gold bullion for accounting purposes.
 
Share activities for the years ended
December
31,
2016,
2015
and
2014
were as follows:
 
 
 
December 31,
 
 
 
2016
 
 
2015
 
 
2014
 
 
 
Shares
 
 
Amount
 
 
Shares
 
 
Amount
 
 
Shares
 
 
Amount
 
Shares issued
    
314,850,000
     $
3,784,339,342
      
72,050,000
     $
830,130,993
      
48,100,000
     $
590,756,513
  
Shares redeemed
    
(167,950,000
 )    
(1,992,755,088
 )    
(99,350,000
 )    
(1,071,599,347
 )    
(50,700,000
 )    
(605,981,738
 )
Net increase (decrease)
    
146,900,000
     $
1,791,584,254
      
(27,300,000
 )   $
(241,468,354
 )    
(2,600,000
 )   $
(15,225,225
 )
 
E.
Federal Income Taxes
 
The Trust is treated as a grantor trust for federal income tax purposes and, therefore, no provision for federal income taxes is required. Any interest, expenses, gains and losses are passed through to the holders of Shares of the Trust.
 
The Sponsor has reviewed the tax positions as of
December
31,
2016
and has determined that no provision for income tax is required in the Trust’s financial statements.