Annual Report 2018-19 Welcome

This report outlines West Gippsland Healthcare Group’s (WGHG) activities and performance from 1 July 2018 - 30 June 2019 and provides detailed financial statements about the organisation.

WGHG is a public health service established under the Health Services Act 1988 (Vic). The incorporation came into effect in May 1997 when services across the community came together under the one umbrella name, West Gippsland Healthcare Group.

Photography and content production: Karyn O’Brien These include West Gippsland Hospital, Community Simon Schreyer and Logan Ginger Drone camera: Health services at Warragul and Rawson, Andrews Cover image: The changing face of West Gippsland Hospital. During 2018-19 a new Short Stay Unit, new House Residential Aged Care, Cooinda Lodge roadway and car parking was added to the front of Residential Aged Care and the Warragul Linen Service. the hospital.

During 2018-19, WGHG was accountable, through our Board of Directors, to Jenny Mikakos MP Minister Graphic Design and Print: Dragons Ink for Health, Minister for Ambulance Services (29 Nov 2018 – 30 June 2019) and The Hon Jill Hennessy MP Minister for Health, Minister for Ambulance Acknowledgements: Services (July 1 2018 – 29 Nov 2018) West Gippsland Healthcare Group acknowledges the funding support provided by the Victorian Government. This report is available online at: www.wghg.com.au Publications. Printed copies are available by contacting our Public Relations Office on 5623 0600.

We acknowledge the traditional owners of the land on which our services are located, and we pay our respects to Elders past, present and future.

Thank you to the staff, volunteers, patients and supporters of the West Gippsland Healthcare Group. ABN: 39 261 883 406

2 West Gippsland Healthcare Group Annual Report 2019 Welcome Contents

Welcome Our Community...... 27-30 Chair & Chief Executive Officer Donations & Fundraising

Report...... 4-5 Our Performance...... 31-39 Statement of Priorities Our Healthcare Group...... 6-11 About Us Part A Strategic Priorities History Part B Performance Priorities Services Part C Activity and Funding

Summary of Financial Results.....40-43 Corporate Governance...... 12-15 Board of Directors Financial WIES comparison Organisation Chart Five year financial comparison Reconciliation between the Net result Our Achievements...... 16-21 Financial Report Clinical Operations Report Medical Services Report Reporting Requirements...... 44-49

Allied and Community Health Report Declarations...... 50-53 Corporate Services Report Attestations People and Culture Report Financial Declaration Victorian Auditor General's Report Our People...... 22-26

Staff Financial Statements...... 55-121 Occupational Health & Safety Disclosure Index...... 122 Service Awards Below: Board Chair Christine Holland and CEO Dan Weeks view construction of the new Short Stay Unit at West Gippsland Hospital with Site Manager, Phillip Cross of INTREC

West Gippsland Healthcare Group Annual Report 2019 3 Report from the Chair and Chief Executive

Dan Weeks Christine Holland RN BBus(Acc) MHA MCareerDev GAICD ACHSM GradCertCarCounsel TSTC(HomeEco) GAICD Chief Executive MAHRI PCDAA Officer Board Chair appointed July 2018

On behalf of the Board and Staff Planning for the Future of West Gippsland Healthcare We will continue to work with government to secure our long Group and in accordance with the term future and respond to the needs of a rapidly growing Financial Management Act 1994, it community. We will work closely with the Department of Health is our pleasure to present the Report and Human Services (DHHS) to develop our new Strategic Plan 2019 - 2023, due to be released later in the year. of Operations for the year ending 30th June 2019. Managing Growth This was a very eventful year with the most significant The number of hospital in-patients increased by 7% to challenge being the unplanned closure of our two operating over 13,000 despite the unplanned theatre closures. The theatres from early May until early July 2019. The closure number of Emergency Department attendances also set was the result of breaches to the integrity of the theatres a new record, with just under 24,000 patients treated, during construction of a new third operating theatre due to up from 23,000 the previous year. The strategies to work open later in 2019. We apologise to the many people in the with neighbouring hospitals to keep births under 1,000 community who had their surgery postponed or were forced was again successful, with just over 900 births. Staff are to travel elsewhere while the theatres were repaired. During commended for coping with record numbers of patients the closure, urgent surgeries were re-scheduled or referred during three major construction projects. There is much thanks to support from neighbouring health services. excitement anticipating the increase in capacity to help meet the growing demand. The building of the third theatre is one of three major building projects commenced during the year under the Regional Home & Community Health Infrastructure Funding (RHIF) program. A much needed Short Stay Unit to support the Emergency Department The community-based programs operated throughout Baw was also constructed at the front of the Hospital, along with a Baw Shire and residential aged care services at Cooinda new driveway and increased car parking. Lodge and Andrews House continue to provide essential roles in supporting the hospital and maintaining people in While these three projects provide a much needed increase the community. These services, along with Warragul Linen in capacity, there was significant disruption to services Service, are integral parts of West Gippsland Healthcare Group. at times and staff, patients, visitors and the community are praised for their tolerance and support during the construction. We certainly look forward to the benefits these projects will provide to the community.

4 West Gippsland Healthcare Group Annual Report 2019 The number of hospital in-patients increased by 7% to over 13,000 despite the unplanned closure of our operating theatres. The number of Emergency Department attendances also set a new record, with just under 24,000 patients treated, up from 23,000 the previous year.

Financial sustainability The year ahead While we started the year forecasting to deliver a break- After many months of disruption, we look forward to even budget, we finished the year with a deficit result, opening the third operating theatre and the Short Stay largely attributable to the loss of activity associated with Unit which will provide much needed additional physical the theatre closures, some staffing over-runs and failure capacity. The new roadway and additional parking will also to achieve cost saving strategies. Having revenue growing provide some welcome relief to the traffic flow challenges. faster than expenditure remains the correct strategy as we We are also planning to expand the outpatient services juggle demand, expectations and funding realities. This is in areas of significant need to align with government’s likely to remain a significant challenge in the year ahead. priorities. Our people and culture Thank you The Board continues to acknowledge that our staff are our It is an honour and a privilege to lead the service that greatest asset and development of staff and investment to plays such a major role in the health and wellbeing of improve culture remain a priority. Ensuring a supportive our community. We use this opportunity to thank and and caring culture at WGHG is an important strategy in acknowledge our highly skilled Board, Executive, staff recruitment and retention and our efforts to be an employer and volunteers. It has been a difficult year with much of choice. Our People Matters (state-wide staff satisfaction disruption, with each challenge handled admirably. At the survey) results for 2019 have demonstrated we are end of June 2019, the Board farewelled Director Peter engaging and listening to staff, and compare favourably with Kingwill, who served on the Board since 2002. Peter sector and peer groups in many areas. provided a significant contribution to our service and we Community wish him well for the future. Finally we would also like to acknowledge the The Board continues to be inspired and humbled by the contribution of our many community partners, including incredible support demonstrated by the community. This our local members of parliament at both the state and year’s major fundraising efforts (annual appeal, charity golf commonwealth levels and the Department of Health and day and daffodil sales) all exceeded expectations. Stage 2 Human Services. Your support is greatly appreciated and of the Building Better Healthcare Accommodation units in we look forward to working with you over the coming year Sargeant Street to attract medical specialists to our health as we continue to serve our community and seek to secure service was also completed with the generous support of a shared understanding of our future. the Andrews Foundation and many community donors. The ongoing support from our auxiliaries, volunteers, community Christine Holland groups, businesses and donors is very much appreciated and Board Chair makes a significant contribution to the services provided. 11th September 2019

Dan Weeks Chief Executive Officer 11th September 2019

West Gippsland Healthcare Group Annual Report 2019 5 Rachel McPherson with her baby Mary and Clinical Nurse Fleur Glover.

6 West Gippsland Healthcare Group Annual Report 2019 About Us

West Gippsland Healthcare Group (WGHG) is a Our Vision: customer-focused public health organisation To deliver the best health outcomes for the providing acute care, residential care and West Gippsland community. community health services to more than 52,500 people in the rural, urban residential, Our Mission: agricultural and industrial areas located To improve the health and wellbeing of within the Baw Baw Shire and beyond. our community by enabling access to high WGHG’s main hospital campus is in Warragul with quality, contemporary, person-centred allied and community health-based hubs in Warragul, healthcare. Rawson and Trafalgar and residential aged care facilities of Cooinda Lodge in Warragul and Andrews Our Values: House at Trafalgar. It also operates the Warragul Linen Our behaviours and decision making centres Service. around Our Values of: Employing over 1,400 staff, WGHG is the largest c Respect – we treat others as we would like employer in West Gippsland. to be treated During 2019, WGHG re-defined the Organisational Values using results from team-led behaviour c Leadership – we role model the desired development sessions with staff, Executive team and behaviours and speak out when this is not Board. demonstrated

c Accountability – we take personal responsibility for our actions and results

c Collaboration – we work effectively with our consumers, staff and community

c Improvement – we look for opportunities to improve our services and outcomes

West Gippsland Healthcare Group Annual Report 2019 7 Our History

1888 The community established a Hospital on land 1997 The various health services provided across the donated by Mary Sargeant to service the area community were brought together under the umbrella between Melbourne and Sale. name of West Gippsland Healthcare Group (WGHG). 1895 Warragul District Hospital completed. Rawson Community Health Centre incorporated into WGHG. 1908 Warragul District Hospital officially opened. Andrews House opened, accommodating 30 1924 Name change to West Gippsland Hospital (WGH). residents. 1936 The original wooden Hospital building redeveloped. 1998 Baw Baw Health and Community Care Centre opened 1939 The foundation stone of the new brick Hospital laid in Drouin, a joint venture with the Baw Baw Shire. by Mr Dunstan. Stage 2 Redevelopment of the Hospital officially 1940 The new Hospital opened by Sir Winston Duggan. opened. 1970 Eastern extensions to the Hospital opened. The 2005 Extensions to Andrews House in Trafalgar completed, Hospital expanded to 144 beds. accommodating 50 residents. 1978 Stage 1 of Cooinda Lodge nursing home built, Queen Street Community Services building accommodating 28 residents. redeveloped. 1986 Stage 2 of Cooinda Lodge added, accommodating 56 Extensions to Warragul Linen Service completed to residents. accommodate new continuous batch washing system. The Warragul Linen Service moved into purpose-built 2006 Community Rehabilitation Centre relocation project premises in Ley Street. commenced. 1996 A Community Services Centre was established in Stage 3 Redevelopment of the Hospital, incorporating Warragul. the High Dependency and Midwifery Units completed. Stage 1 Redevelopment of Hospital completed. 2007 Community Health and Community Mental Health project completed.

Below: Asphalting the new roadway and car park across the front of the hospital, June 2019

8 West Gippsland Healthcare Group Annual Report 2019 2008 Community Rehabilitation Centre redevelopment 2014 The first self-funded research program announced, underneath Cooinda Lodge completed. Centenary of with $100,000 made available to support clinical opening of first Warragul District Hospital celebrated staff to undertake research programs. Centenary history book ‘Of the People...For the 2015 Relocated High Dependency Unit within Medical Unit People’ and Centenary quilt launched. to expand the number of postnatal and medical unit 2009 WGHG awarded Premier’s Award for Regional Health beds. Service of the Year. 2016 Constructed five units in Sargeant Street Warragul, to 2010 WGH Drouin Auxiliary 50th anniversary celebrated. provide on-site accommodation for visiting clinicians. Completed $5.8m Energy Performance Contract Permanent home purchased for Trafalgar Community (EPC) asset refresh and major refurbishment of Health Services. Cooinda Lodge. Extensions to Drouin Opportunity Shop completed. 2017 WGHG awarded Excellence in Women’s Health award 2011 Feasibility study for redevelopment of West Gippsland for its Positive Pregnancy Program. Hospital site commenced. Completed masterplan and feasibility studies to 2012 Building extension works commenced to the develop detailed proposals for a new hospital on the emergency department. current site or a new hospital on the greenfields site New physicians consulting rooms, education at Lardners Track in Drouin East. facilities, teleconferencing facilities and a new home Secured funding to build a Short Stay Unit in the for the District Nursing Service completed. emergency department and a third Operating Theatre. Study identifies Lardners Track in Drouin East as 2018 Monash University expanded their site in Sargeant preferred site for a new Hospital. Street adding a demountable building. 2013 Emergency department redevelopment completed 2019 Completed construction of five additional units and officially opened by The Hon David Davis MP in Sargeant Street, Warragul to provide on-site 17th May. accommodation for visiting clinicians. Constructed a A record breaking 1020 babies born at WGH. new Short Stay unit next to Emergency Department, new roadway and car parking at the front of the hospital. Construction of a third Operating Theatre is scheduled for completion September 2019.

West Gippsland Healthcare Group Annual Report 2019 9 Our Services as at 30 June 2019

Aged Care Contract Services Paediatric Surgery Aged Care Assessment Breast Screen Pain Management Andrews House Aged Care Facility Endoscopy Palliative Care (inpatients) Cooinda Lodge Aged Care Facility Pathology Pre-Admission Home & Community Care Services Pharmacy Renal Medicine Respite Care Radiology Stomal Therapy Urology & Urodynamics Allied & Community Health Services Home Nursing Service District Nursing Service Support Services Aboriginal Hospital Liaison Officer - Hospital in the Home (HITH) Business Services Children and Family Services - Palliative Care Nursing Casemix Cognitive Dementia & Memory Service (CDAMS) - McGrath Breast Care Nurse Central Sterile Supply Department Community & Allied Health Team - Infusion Clinic Consumer Engagement & (CAHT) Volunteering Contract Management Community Health Nurse Diagnostic Services Continence Engineering Services (Contract Services) Environmental Services Counselling Breast Screen Diabetes Education Finance Endoscopy Food Services Dietetics Radiology First Call – Central Intake Service Health Information Services Pathology Human Resources Health Promotion Pharmacy Rawson Community Health Centre Infection Control Information, Communications & Technology Allied & Community Hospital (acute) Learning & Development Rehabilitation Service Anaesthesia Library Cardiac Rehabilitation Breast Feeding Support Pay Office Dietetics Breast Surgery Performance Improvement Unit Occupational Therapy Cardiology Day Surgery Public Relations, Fundraising & Physiotherapy Donations Dental Surgery Podiatry Security & Car Parking Diabetes Education Social Work Supply & Purchasing Ear Nose & Throat Surgery Speech Pathology Work Health & Wellbeing Emergency Medicine Business Units Gastroenterology Cafeteria General Medicine Consulting Suites General Surgery Salary Packaging Gynaecology Warragul Linen Service Haemodialysis High Dependency Care Continuing & Complex Care Midwifery Geriatric Evaluation & Neonatology Management (GEM) Obstetrics Hospital Admission Risk Program Oncology Post-Acute Care Ophthalmology Residential In Reach Orthopaedic Surgery Transitional Care Program Paediatric Medicine

10 West Gippsland Healthcare Group Annual Report 2019 Hospital attendants from left: Wendy Symonds, Mario Lucchi, Pauline Peters, Jared Dean, Billie-Jean Pilch. West Gippsland Healthcare Group Annual Report 2019 11 Corporate Governance

Our Board of Directors Board Sub-Commitees

The Board of Directors of WGHG is appointed by the Governor- The Board Directors met 10 times throughout the year and were In-Council on the recommendation of the Minister for Health and active members of various Board Sub-Committees set up to Ambulance Services in accordance with the Health Services Act assist in monitoring the Groups various operations. 1988. • Audit & Finance Committee: Peter Kingwill (chair) Leanne Williams During 2018-19, WGHG was accountable through its Board of Sarah Lukies Directors to Jenny Mikakos MP Minister for Health, Minister for Ambulance Services (29 Nov 2018 – 30 June 2019) and The • Quality & Safety Committee: Jo-Anne Moorfoot (chair) Hon Jill Hennessy MP Minister for Health, Minister for Ambulance Beryl Raufer Services (July 1 2018 – 29 Nov 2018). Susan lloyd • Board Performance & Remuneration Committee: Board functions Beryl Raufer (chair) The functions of the Board of Directors are to: Peter Kingwill • oversee and manage the Group Christine Holland • ensure services provided by the Group comply with the The Board establishes Working Groups for appropriate projects requirements of the Act and aims of the Group. on an ‘as needs’ basis. Governance by the Board is achieved through: • strategic planning • effective management of the Chief Executive Officer • funding of service agreements • local policy setting • regular reviews of the Group’s by-laws and strategic plans

12 West Gippsland Healthcare Group Annual Report 2019 Board of Directors: July 2018 - June 2019

Jane Leslie BBusChristine GAICD Beryl Raufer CompanyHolland GCCM BEd GAICD DirectorMCareerDev and CertProfMediation ExecDipCoaching BusinessGradCertCarCounsel TSTC(HomeEco) Senior Executive ConsultantGAICD MAHRI PCDAA Disability / Not for Position:HR and Career Profit Sector ChairConsultant until June 30 2018 Position: Position: Deputy Chair Board Chair

Commenced as a Board Director in July 2014 Commenced as a Board Director in July 2017 Member of the Board Performance & Remuneration Member of Quality & Safety and Board Performance & Committee Remuneration Committees Board meetings attended 100% Board meetings attended 91%

Peter Kingwill Jo-Anne BEng FGCLP FAICD Moorfoot Company BAppSc GradDipBA Director GAICD CertProjMan Position: Executive Board Director Director (Healthcare Governance) Position: Board Director

Commenced as a Board Director in 2002 Commenced as a Board Director in July 2017 Chair of Audit & Finance Committee and member of Board Chair of the Quality & Safety Committee Performance & Remuneration Committee Board meetings attended 91% Board meetings attended 91%

West Gippsland Healthcare Group Annual Report 2019 13 Board of Directors: July 2018 - June 2019

Susan Lloyd Leanne Susan Lloyd Williams BAppSci, GradDipEd, BComm (Accounting) MOrgLeadership, GradDipCA GAICD FAICD Chief Executive Corporate Officer West Leadership Gippsland Consultant and Libraries Teacher Position: Position: Board Director Board Director

Commenced as a Board Director in July 2018 Commenced as a Board Director in July 2018 Member of Quality & Safety Committee Member of the Audit & Finance Committee Board meetings attended 91% Board meetings attended 91%

Sarah Lukies Sarah MBA LLB BBUS Brentnall Legal Practice BAppSc(Physio) PGDip (Musc) PGDip Position: (Manip) MScMed (Pain Managt) GAICD Board Director Position: Board Director

Commenced as a Board Director in July 2018 Commenced as a Board Director in May 2019 Member of the Audit & Finance Committee Board meetings attended 100% Board meetings attended 100%

14 West Gippsland Healthcare Group Annual Report 2019 Organisational Chart West Gippsland Healthcare Group

BOARD OF DIRECTORS

CHIEF EXECUTIVE OFFICER Public Relations Fundraising & Donations

Manager Chief Medical Director Allied & Director People Director Clinical Operations Director Corporate Services Warragul Linen Officer Community Health & Culture Service

Performance Improvement Unit Infection Control Consultant

Continuing & Complex Care General Manager General Manager HARP/PAC/RIR/GEM & TCP Operations Manager Operations Manager Operations Manager Finance &Corporate Facilities Access & Demand Aged Care Women, Children Services Management Allied Health Surgical Services Community Rehabilitation Occupational Therapy Physiotherapy Hospital Coordinators Speech Pathology Dietetics Social Worker Human Resource Clinical Leads Medical Unit Andrews House Surgical & Finance Environmental Services Recruitment Production Paediatric Unit Primary Community Health Employee Relations Senior Medical Emergency Department Cooinda Lodge Business Services Food Services CDAMS (Memory Clinic) Reward & Recognition WLS Staff Short Stay Unit Continence Administration Operating Rooms Contracts Engineering Services Diabetes Education Work Health & Registrars District Nursing Services Day Surgery Community Health Nurse Wellbeing Transport Hospital in the Home CSSD Salary Packaging Information & Young Mum Group

Annual 2019 Report HMO’s Palliative care Communication Counselling Services Payroll Quality, OH&S Breast Care Support Maternity Unit Supply & Purchasing Technology First Call (Central Intake) and CI Interns HACC Special Care Nursery Services Health Promotion Team Consumer & Security Aboriginal Hospital Liaison Volunteer Maintenance & Medico Legal Haemodialysis ESAC HIS &Reception Car Parking Engagement Capital Projects Preadmission Rural Allied Health Service Casemix (Coding) Oncology Wellness & Reablement Learning & Customer Services Consulting Suites Consultant Development Occupational Therapy Nursing & Midwifery Diabetes Education Physiotherapy Medical Educators Speech Pathology Dietetics Library Counselling Podiatry Contracted Services: Pathology Rawson Community Radiology Health Centre Pharmacy Child Safe & Family Violence 15 Endoscopy Project Manager Our Achievements

WGHG Child Safety Manager Leanne Coupland, CEO Dan Weeks and Director of Allied & Community Health Audra Fenton

16 West Gippsland Healthcare Group Annual Report 2019 Our Achievements

DIRECTOR OF CLINICAL OPERATIONS

Report by Kathy Kinrade

RN GradDipCCareN DipMgt MNurs

The Director of Clinical Operations has an extensive role responsible for all clinical units in the Hospital, two aged care residential facilities and same day services such as dialysis, day surgery and oncology and community-based nursing services.

Key achievements during 2018-19 include: • Successfully participated in the Women’s Healthcare • Successfully trialled a graduate supported program at Australasia Collaborative to reduce avoidable 3rd and Andrews House enabling six enrolled nurses to receive 4th degree tears in maternity patients. WGHG maternity education and mentoring with future similar programs group achieved the most outstanding improvements of all planned. participating organisations across Australia. • Successfully participated in the Safer Care Victoria • Successfully relocated the Infusion Day Clinic from the Collaborative to improve outcomes in patients with Sepsis. Operating Suite area to District Nursing Clinic to improve access and availability of service. • Participated in the Safer Care Victoria Patient Flow Collaborative to improve flow of patients from the • Implemented the Voluntary Assisted Dying Care Pathway Emergency Department to inpatient beds. (VAD) as per legislative requirements from June 2019. WGHG will be a partnership service providing appropriate referral pathways and information to an appropriate clinician or service if VAD is requested.

West Gippsland Healthcare Group Annual Report 2019 17 Our Achievements

CHIEF MEDICAL OFFICER DIRECTOR OF EMERGENCY MEDICINE

Report by Dr Gary Campain

MBBS, FACEM, AFRACMA, GradCertMgt

The Chief Medical Officer provides oversight of the junior and senior medical staff; provides oversight of safety and quality processes and outcomes; provides high level advice on medical matters; assists in fostering optimal working relationships between medical staff and the Executive in achieving the common goal of high quality patient care within a responsible financial reality.

Key achievements during 2018-19 include: • Completed commissioning of the new Short Stay Unit to • Achieved re-accreditation for: support the Emergency Department. o Intern and Hospital Medical Officer (HMO) Training by Post Medical Council of Victoria. • Developed Hospital Medical Officer positions to promote o General Practitioner training by Eastern Victoria GP a ‘taster plate’ leading to Regional Specialist training in Training for Royal College of General Practice and collaboration with the Gippsland Regional Training Hub. Australian College of Rural and Remote Medicine.

• Achieved accreditation for: • Continued membership of Gippsland Regional Directors of Medical Services/Chief Medical Officers to improve o All levels of Emergency Medicine Training by collaboration across the region. Australasian College of Emergency Medicine. o All levels of Obstetrics and Gynaecology Training by Royal Australian and New Zealand College Obstetrics and Gynaecology.

18 West Gippsland Healthcare Group Annual Report 2019 DIRECTOR OF ALLIED AND COMMUNITY HEALTH

Report by Audra Fenton

RN, GradDip MN, Grad Dip Bus Man., CMHN, MNurs (Mental health), ACMHN

The Director of Allied and Community Health has a pivotal role in the delivery of community and hospital-based services for West Gippsland, advising on issues related to primary, allied and community health services. The role also requires a continuing development of, and involvement in, strategic alliances and partnerships, and community-based networks both within Baw Baw Shire and on a regional and state-wide basis.

Key achievements during 2018-19 include: • Attained Child Wise accreditation. WGHG is the first health • Partnered in PJ Paralysis, a program to encourage patients service in Australia to gain this. in hospital to get up and get dressed to aid early recovery.

• Received an honourable mention at Primary Health • Participated as a key stakeholder in the joint Municipal Network awards for ICAN, a healthy eating and exercise Health Plan, the second only joint plan in the state. program for survivors of cancer.

• Reviewed Cultural Awareness training to focus on history • Recognised as a regional expert on ‘Healthcare that and inclusion. counts’ – a framework that focuses on care for vulnerable children and young people.

West Gippsland Healthcare Group Annual Report 2019 19 Our Achievements

DIRECTOR OF CORPORATE SERVICES

Report by Justin Walsh

CPA BBus (Acct) BBus (Bank&Fin)

The Director of Corporate Services oversees the business and corporate operations of the Group that support the delivery of services and agreed outcomes. The position also provides financial and procurement leadership as the Chief Financial Officer (CFO) and Chief Procurement Officer (CPO) for the Group.

Key achievements during 2018-19 include: • Completed construction of the following new buildings: • Achieved energy savings equivalent to 2,320 tonnes CO2-e - Eight bed Short Stay Unit including new main entrance greenhouse gas emission (year three of the seven year roadway for patient drop off. Energy Performance Contract). - Five unit accommodation building on Sargeant Street. • Achieved full compliance with annual food safety audit and cleaning standards. • Commenced construction of new Third Operating Theatre building with completion due September 2019. • Implemented new contract management system (BRAVO). Benefits include a single system used by Health • Awarded funding under Regional Health Infrastructure Fund Purchasing Victoria (HPV) and health agencies, enabling (RHIF) Round 3 to commence priority works to upgrade more standardised procurement sourcing and contract theatre sterilisers and kitchen plant. management processes.

• Commenced upgrade of the communication and nurse call system across the hospital. The System will initially utilise Digital Enhanced Cordless Telecommunications (DECT) technology and migrate over to wireless networking (Wi-Fi).

20 West Gippsland Healthcare Group Annual Report 2019 INTERIM DIRECTOR PEOPLE & CULTURE

Report by Alan Hollensen

BEng(Hons) DipPracMgt

The newly established role of Director of People and Culture aims to lead the organisation in the areas of staff and leadership growth, organisational culture development, employee and consumer engagement, diversity and inclusion. The role also provides expertise and support in the areas of learning and development, performance management, employee relations, policy development, human resources and workplace health and wellbeing.

Key achievements during 2018-19 include: • Completed team-led behaviour development sessions for • Implemented ‘Studer’ Program tools to improve our WGHG teams. These results have been used to re-define leadership and management development framework; our Organisational Values. also providing coaching in ‘soft’ and ‘hard’ skills for team engagement, growth and accountability.

• Implemented organisation-wide Daily Operating Systems (DOS) meetings for better communication up and down the • Launched new Community Voices group to provide a organisation, allowing daily problem solving within teams. conduit to actively engage and consult with representatives from our community.

• Implemented online Learning and Development calendar. • Achieved significant improvement in key staff satisfaction survey results.

West Gippsland Healthcare Group Annual Report 2019 21 Our People

22 West Gippsland Healthcare Group Annual Report 2019 Our People

In 2018-19 WGHG employed a total of 1,400 people (776 full-time equivalent) across the organisation. The biggest category of employees is nursing staff.

FULL TIME EQUIVALENT STAFF June Current Month June Year to Date Labour Category 2018 2019 2018 2019 Administration & Clerical 108.07 106.36 101.94 105.90 Ancillary Support 59.40 59.57 55.60 66.32 Hospital Medical Officers 37.23 26.68 36.73 32.13 Hotel & Allied Services 213.64 204.55 213.89 206.33 Medical Officers 4.50 5.07 4.35 4.95 Medical Support 16.17 24.28 15.36 23.70 Nursing Services 331.19 329.65 313.08 329.19 Sessional Clinicians 11.98 16.23 10.71 13.86 Total 782.18 772.39 751.66 776.38 * FTE stands for full-time equivalent position. All employees of WGHG are correctly classified in the workforce data collections.

Our People and Culture Huddles improve communication Our people are our greatest asset and development of staff The introduction of organisation-wide daily ‘huddles’ (Daily and investment to promote a positive culture remain a priority. Operating Systems (DOS) meetings) where teams meet to During 2018-19, a Director of People and Culture position discuss any issues has enabled better communication up and was established to drive this. Building a supportive and caring down the organisation, allowing daily problem solving within culture is an important strategy in recruitment and retention teams. and our efforts to be an employer of choice. Over the past 12 Photo left page: Harold Paul, Environmental Services months, there has been increased focus on providing learning and development opportunities for all staff, coaching for Photo below: A highlight for staff is the annual Christmas leaders and training support for volunteers. lunch and dinner hosted by the executive team and Board of Directors to thank staff. A Best Dressed Christmas Department competition is also held.

West Gippsland Healthcare Group Annual Report 2019 23 Our People

Employment and conduct principles Staff OVA Training WGHG is committed to upholding the principles of merit and Over 720 staff have now undertaken full-day OVA training equity in all aspects of recruitment and employment. Policies with a further 23 refresher sessions conducted for staff 12 and practices are in place to ensure all employment related months after their initial training. decisions, including recruitment, promotion, training and During the year, in conjunction with our Learning and retention, are based on merit. Development Unit, all our policies, procedures and Any complaints, allegations or incidents involving competencies involving manual handling and patient transfer discrimination, vilification, bullying or harassment are taken have been reviewed and updated as necessary. seriously and addressed. All staff are provided with education and training on their rights and responsibilities and are Supporting early return to work required to abide by the WGHG Code of Conduct and all Our focus on prevention and early return to work has resulted WGHG policies under their employment agreement. in a decrease of 16.7% in our Workcover premium from 2017- 18. The reduction in claims costs is attributed to dedicated Occupational Health & Safety (OH&S) resources and focus on supporting early return to work (RTW). West Gippsland Healthcare Group aims to provide a safe and healthy environment for patients, residents, staff, contractors Employment Assistance Program (EAP) and visitors. More staff are using the WGHG Employee Assistance Program (EAP) which provides employees, volunteers and their We aim to manage all hazards and control any risks so far as immediate families with access to free external counselling is reasonably practicable. and support with experienced and qualified professionals. In 2018-19 we remained focused on the prevention of Some 76% of staff reported, via internal survey, that they occupational violence and aggression (OVA) and the know how to access our EAP. prevention of musculoskeletal injuries due to hazardous manual handling and slips, trips and falls. Some 86% of staff reported, via internal survey, that they felt supported if stressed, anxious or experiencing large workloads.

OH&S Statistics 2016-17 2017-18 2018-19 Number of reported hazards/incidents for the year per 100 full-time 12 24.8 28.2 equivalent staff members Number of lost time standard claims for the year per 100 full-time 0.29 0.79 0.42 equivalent staff members Average cost per claim for the year (including payments to date and an $88,745 $108,210 $31,040 estimate of outstanding claim costs as advised by WorkSafe) Occupational violence statistics 2018-19 WorkCover accepted claims with an occupational violence cause per 100 FTE 0 Number of accepted WorkCover claims with lost time injury with an occupational violence cause per 0 1,000,000 worked Number of occupational violence incidents reported 94

Number of occupational violence incidents reported per 100 FTE 12.1

Percentage of occupational violence incidents resulting in staff injury, illness or condition 6%

Definitions: if an incident occurs during the course of a planned or unplanned Occupational violence - any incident where an employee is Code Grey, the incident must be included. abused, threatened or assaulted in circumstances arising out of, or Accepted WorkCover claims – Accepted WorkCover claims that in the course of their employment. were lodged in 2018-19. Incident – an event or circumstance that could have resulted in, Lost time – is defined as greater than one day. or did result in, harm to an employee. Incidents of all severity rating Injury, illness or condition – This includes all reported harm as a must be included. Code Grey reporting is not included, however, result of the incident, regardless of whether the employee required time off work or submitted a claim. 24 West Gippsland Healthcare Group Annual Report 2019 Service Awards

At the Annual General meeting the Board recognises staff who have achieved significant employment milestones. At the 2018 AGM, the following awards were presented: 35 Years 25 Years 15 Years Kerry Bowman Robyn Bloye Katharine Barry Tracy McMillan Patricia Nankervis Debra Fleming Leonard Cole Stephanie Meharry Teresa Webster Jennifer O'Hara Lynda Dempsey Amanda Needham Annette Perry Stephen Earl Mairead O'Connor 30 Years Grace Proctor Jodie Gray Moira Ratcliffe Kaylene Browne Avine Wiltshire Lindy Green Simon Schreyer Debra Dore Pauline Grothaus Christopher Smith Anne Nelson 20 Years Heather Hibbert Marissa Traumanis Kathleen Robinson Linda Aberdeen Andrew Jackman Jaunice Ward Kathleen Strugnell Helen Beggs Vaneta Maher Catherine Wilson Eileen Wells Emily Eade Anne White Helen Keating Kerri Morello Leanne Pollard Arthur Redmond

Pictured: WGHG Staff celebrate long service awards at the 2018 AGM Back from left: Marissa Traumanis, Avine Wiltshire, Leanne Pollard, Kathleen Strugnell, Robyn Bloye, Heather Hibbert, Helen Keating. Front from left: Patricia Nankervis, volunteer Shirley Grove, Eileen Wells, Grace Proctor, Debra Dore and Jennifer O’Hara.

West Gippsland Healthcare Group Annual Report 2019 25 Service Awards

Life Governor Awards Each year, the Board of At the 2018 AGM, Jan Directors consider people Bennett was presented who are worthy recipients for with a WGHG Life Governor award for a Life Governorship Award. 27 years of service to The criterion is stringent and nursing. reflects first and foremost meritorious service, with a secondary length of service requirement.

Volunteer Recognition of Service Awards Volunteer Shirley Grove received an award for ten years of volunteer Volunteers and Auxiliary service. Shirley has members with 10 years or supported the hospital’s more of volunteer service mobile book trolley to WGHG are recognised which visits patients and aged care residents under the award category providing them with of Volunteer Recognition of a range of reading Service Award. materials for loan.

26 West Gippsland Healthcare Group Annual Report 2019 Our Generous Community

Donations: July 1 2018 $5,000 - $19,999 R & F Knight Royce Nuttall - June 30 2019 Alice Andrews Suzanne Midgley WGHG is fortunate to receive generous Anonymous Donor The Grange Café support from the community. During Blyth Bros Trafalgar & District Comm Opp Shop 2018 - 19, we received an impressive David Jackson $1,353,777 through donations and Trafalgar Lions Club M FitzGerald fundraising activities which we are most Valda Skinner Estate of W J Payne grateful for. Warragul Bowling Club Gippsland Sporting and Classic Car We also acknowledge the support Register Australian Stock Horse Society West received through Trusts and Bequests, Gippsland Branch H & L McCarthy in particular the ongoing generous Wilfred Joseph Boscombe support of The Andrews Foundation, John & Robin Blyth Pethard Tarax Charitable Trust, William Lions Club of Yarragon Joseph Payne Trust, Charles Haworth Smith McCarthy Wilson Trust Estate, Geoffrey Bruce Russell Under $1,000 Southern Cross Austereo Estate and many others who choose to We are grateful for all donations donate to us privately. Town and Country Gallery Yarragon both large and small. During 2018- Vin Rowe Farm Machinery Pty Ltd 19, WGHG received more than 349 donations under $1,000. When Over $100,000 combined, these donations make a big $1,000 – $4,999 impact and assist us to purchase much Bequest donor requested to be needed medical equipment and patient anonymous A & G Kaiser comfort items. Estate of the late Geoffrey Bruce Russell Anonymous donor A special thankyou to all the knitters The Andrews Foundation Anonymous donor and sewers who kindly donated Anonymous donor handmade items to our maternity and B & E Sherriff paediatric units. $50,000 - $99,999 Bunyip IGA Supermarket Charles Haworth Trust Estate Brad Aitken & Helen Lockwood Donor requested to be anonymous Caltex Service Stations, Longwarry In Memoriam donations Estate of the late Charles Wallace Carlo Bragagnolo We receive many in memoriam donations following the death of a Hyndman Club 88 loved one, for which we are most Creative Collective Makers Market appreciative. $20,000 - $49,999 DE & JL Fortune Diane Toogood Bendigo Bank & Warragul Country Club Charity Golf Day Dorothea Sedgewick How to donate Drouin Auxiliary Opp Shop Estate of Daphne Aileen Gosch Donations can be made: Drouin-Warragul RSL Bowling Club Lions Club of Drouin • on line at www.wghg.com.au, First National Real Estate Lions Club of Warragul securely using a credit card or PayPal Issam Muteir Rotary Club of Drouin • by cheque made payable to: Trafalgar & District Community Opp Helen Winter West Gippsland Healthcare Group and Shop Hallora Hall Committee mailed to 41 Landsborough Street, Jenny Britt Treasure Your Chest - Girls Day Out Warragul Lardner Ladies Social Club • in person to the Public Relations Neerim District Lions Club Manager at the main hospital campus Peter Lubberink • Phone: 03 5623 0600 Pethard Tarax Charitable Trust

West Gippsland Healthcare Group Annual Report 2019 27 Service Awards

28 West Gippsland Healthcare Group Annual Report 2019 Our Generous Community

West Gippsland Healthcare Group Annual Report 2019 29 Our Generous Community

Fundraising and events Daffodils bloom for 25 years Charity Golfers This year marked the 25th anniversary In its fifth year, the annual Charity committee to provide a forum for of our annual daffodil bulb fundraiser Golf event and community raffle meaningful engagement with our thanks to the Blyth Bros Farm at raised $35,000 this year thanks to community. We also established our Ellinbank which has donated 50,000 a partnership between the Warragul Volunteer Concierge program to provide bulbs to us each year. Country Club Volunteer committee a friendly wayfinding service for patients and Bendigo Bank Community Bank® and visitors at our hospital site. The bulbs are sold at our main hospital branches of Drouin, Trafalgar and reception, community health services, We are grateful to the following Neerim South and the Warragul Trafalgar and Drouin Opportunity Shops volunteer groups for their continued branch. $28,000 was donated to our and retail outlets including Town and support: Emergency Department and $7,000 Country Gallery, Grange Café, Down to support the Warragul and District Andrews House Volunteers to Earth Garden Centre, Bunyip IGA, Specialist School. Caltex Longwarry and at our stand at Community Rehabilitation Centre Farmworld. Over the past 25 years, Social Media boosts Woodworkers the bulbs have raised an estimated fundraising Community Voices (consumer advisory $380,000. All proceeds raised through committee) the sale of daffodil bulbs goes directly The establishment of a to purchase medical equipment for our @WestGippslandHospitalSupporters Cooinda Lodge Volunteers Facebook page has provided an Allied and Community Health Services. Drouin Auxiliary and Drouin Opportunity additional platform to connect with Shop Annual Equipment Appeal the community to recognise and thank Mobile Book Trolley Service In May and June 2019 we ran our supporters, partnerships and promote third Annual Equipment Appeal to online donation options. Palliative Care Service Volunteers support our hospital and aged care Our Dedicated Volunteers Past Nursing Graduates Archive residences. Priority medical equipment Committee was identified and options provided WGHG gratefully acknowledges the for people to donate to each item. The dedicated volunteers who give their Rawson Auxiliary fundraiser exceeded its target, raising time freely to assist our programs and services. During the year, we Trafalgar & District Community $116,000 and attracting many new Opportunity Shop donors. established a Community Voices

WGHG holds an annual luncheon to thank our volunteers.

30 West Gippsland Healthcare Group Annual Report 2019 Our Performance

WGHG Perioperative Service Manager Todd Griffiths, Associate Nurse Unit Manager Kim Gourley and Clinical Nurse Specialist Tania McGarrity.

West Gippsland Healthcare Group Annual Report 2019 31 Our Performance Part A: Strategic priorities

HEALTH SERVICE GOALS STRATEGIES OUTCOMES DELIVERABLES Better Health Better Health WGHG will participate and meet ACHIEVED objectives in the Municipal Objectives met within joint Municipal Health Plan. Warragul Linen Service has A system geared Reduce statewide risks Health Plan including: Commencing The Achievement commenced Achievement Program and has to prevention Program for the Warragul been provided with mental health toolbox as much as Linen Service and developing training. treatment strategies to reduce intake of Build healthy Systems map and gap analysis in place for sugary drinks, measured by reduction of sugary drinks priority. neighbourhoods gap analysis and pre and post survey. FOODcents sessions delivered targeting Everyone school students. understands their ACHIEVED own health and WGHG will deliver 12 Living Help people to stay Active programs through a The Rural Allied Health Service risks Physiotherapist and Allied Health Assistant healthy multi-disciplinary group model, measured by pre and post client completed nine Living Active programs in surveys. Warragul and Trafalgar. The three remaining Illness is detected programs were transitioned into community and managed education sessions which had a wider reach and promoted self-determination. early Target health gaps WGHG, in recognising Family ONGOING Violence as a health issue, 40% of staff (clinical and non-clinical) have Healthy will deliver the Strengthening completed the Strengthening Hospitals neighbourhoods Hospitals Responses program to Responses to Family Violence Training. 10 clinical areas, measured by pre support staff have been trained and polices and communities and post staff surveys. and protocols to guide staff have been encourage healthy developed. lifestyles Pre and Post surveys indicate that knowledge, and culture has improved since the training was implemented.

Better Access Better Access WGHG will meet demand in ONGOING access to Oncology services Expansion of service not yet implemented Care is always Plan and invest through expanded treatment but planning completed. Project Officer there when people models. appointed and working with day procedure need it. oncology treatment data and scoping Unlock innovation the requirements for a Cancer Patient More access to Coordinator position to assist. Collaboration care in the home Provide easier access with LRH has eased demand pressure. WGHG will actively participate and community. ACHIEVED in the Patient Flow Collaborative Ensure fair access WGHG has actively participated in Project to improve results in People are collaborative work shops across Victoria the National Emergency Access connected to the and submitted final report to Safer Care Target (NEAT). full range of care Victoria (SCV). Outcomes achieved include: and support they an improvement in NEAT compliance of need. 3% (from base line 68% to 71%), an improvement in Emergency Department There is equal to ward transfer from 28% to 35%. A access to care. Daily Operation System (DOS) project was implemented which has assisted the project.

32 West Gippsland Healthcare Group Annual Report 2019 Part A: Strategic priorities

HEALTH SERVICE GOALS STRATEGIES OUTCOMES DELIVERABLES Better Care Better Care WGHG will build a Short Stay ACHIEVED Unit to improve access to care Eight-bed Short Stay Unit constructed and Target zero avoid- Put Quality First in the Emergency Department. will commence in September 2019. able harm. Join up care WGHG will engage Health ACHIEVED Healthcare that Issues Centre to deliver skills Three training sessions for consumers and focusses on Partner with patients training for consumers and staff staff from the Health Issues Centre were outcomes. to improve patient centred care conducted: Strengthen the work- and teach staff how to work Patients and force effectively with consumers. • Patient Centred Care for Clinical and carers are active Non-Clinical Staff partners in care. Embed evidence • Quality and Safety for Consumers • Health Literacy for Clinical and Non- Care fits together Ensure equal care Clinical Staff around people’s needs. Overall attendance rates were above 75% capacity.

Feedback rates were above 85% highly recommended. Specific Disability Action 2018-19 Plans ACHIEVED priorities A WGHG Disability Action Plan has been (mandatory) developed and submitted in draft form to Draft disability action WGHG will submit a Disability DHHS. The deliverables will be driven by plans are completed in Action Plan to the Department The Health and Wellbeing and Community 2018-19. of Health & Human Services Voices committees. (DHHS) by June 30, 2019 and outline the approach to fully implement the Plan within WGHG by June 30, 2020. The organisation wide Diversity Plan is The WGHG Diversity Plan under development and will now include includes annual objectives for vulnerable populations including disability. Disability specific programs. This document will be circulated for consultation and implementation in 2019- 20.

A Service specific Diversity Plan for Commonwealth Home Support and programs for younger people has been completed and submitted.

West Gippsland Healthcare Group Annual Report 2019 33 Part A: Strategic priorities

HEALTH SERVICE GOALS STRATEGIES OUTCOMES DELIVERABLES Volunteer WGHG will establish a ACHIEVED engagement Consumer Engagement and Consumer Engagement and Volunteers Volunteer Coordinator role to Coordinator appointed and Consumer Ensure that WGHG has support and engage volunteers. Participation Plan launched. appropriate measures to engage and recognise Five volunteer functions were held volunteers. WGHG will again host an annual throughout the year including the annual volunteer function to celebrate WGHG National Volunteer Week luncheon. the contribution of volunteers. Other volunteer recognition initiatives include: • quarterly Be an Exceptional Volunteer workshops • various staff training sessions to volunteers • quarterly volunteer newsletter

Bullying and harassment ONGOING Actively promote positive All WGHG staff will complete Mandatory bullying and harassment workplace behaviours mandatory bullying and training three yearly cycle has commenced. and encourage reporting. harassment training each three Human Resources Department are piloting Utilise staff surveys, years with an initial training management competency workshops which incident reporting round in 2018-19. include bullying and harassment as a focus data, outcomes of topic. investigations and claims to regularly monitor and WGHG will continue to monitor New Board KPI report includes performance identify risks related to culture and identify any risks monitoring on bullying and harassment. bullying and harassment, arising from results of People All reports of bullying and harassment are in particular include as Matters Survey. appropriately investigated. Independent a regular item in Board external consultants are engaged to assist and Executive meetings. with complex cases where appropriate. Appropriately investigate all reports of bullying and harassment and ensure there is a feedback mechanism to staff involved and the broader health service staff.

34 West Gippsland Healthcare Group Annual Report 2019 Part A: Strategic priorities

HEALTH SERVICE GOALS STRATEGIES OUTCOMES DELIVERABLES Occupational violence and aggression (OVA) ACHIEVED Ensure all staff who have WGHG will continue to Actions from the OVA continue to be contact with patients and implement action plans from implemented. In addition a site specific risk visitors have undertaken the OVA framework and ensure assessment was undertaken. OVA incidents core occupational compliance to code grey reported under new Board KPI report. OVA violence and aggression training for applicable staff. and Code Grey Training is continuing with training (OVA) annually. more than 720 staff trained to date as well Ensure the Department’s occupational violence as 27 refresher sessions occurring. and aggression training principles are implemented.

Environmental Sustainability ACHIEVED Actively contribute to WGHG will renew the Energy savings remain on track in the development of the Environmental Management year three of seven under the Energy Victorian Government’s Strategy and achieve third year Performance Contract. policy to be net zero carbon by 2050. environmental and efficiency WGHG has signed up with GROW Gippsland savings as stated under the and will look at new initiatives to meet Improve environmental Energy Performance Contract. the Victorian Government’s new Social sustainability by Procurement policy from September 2019. identifying and Additional strategies include replacement implementing projects, of polystyrene cups with more eco-friendly including workforce education, to reduce paper cups and introducing bio-degradable material environmental straws following a successful trial in impacts with particular Cooinda Lodge to replace plastic straws. consideration of procurement and waste management.

Publicly report environmental performance data, including measureable targets related to reduction of clinical, sharps and landfill waste, water and energy use and improved recycling.

West Gippsland Healthcare Group Annual Report 2019 35 Our Performance Part B: Performance priorities High quality and safe care

Key performance indicator Target 2018-19 Result Accreditation Accreditation against the National Safety and Quality Health Service Standards Accredited Achieved Compliance with the Commonwealth’s Aged Care Accreditation Standards Accredited Achieved Infection prevention and control Compliance with the Hand Hygiene Australia program 80% 85.3% Percentage of healthcare workers immunised for influenza 80% 88%

Patient experience

Key performance indicator Target 2018-19 Result Victorian Healthcare Experience Survey - data submission Full compliance Full compliance Victorian Healthcare Experience Survey - patient experience Quarter 1 95% positive experience 96.8% Victorian Healthcare Experience Survey - patient experience Quarter 2 95% positive experience 96.5% Victorian Healthcare Experience Survey - patient experience Quarter 3 95% positive experience 89.9% Victorian Healthcare Experience Survey - discharge care Quarter 1 75% very positive experience 82.7% Victorian Healthcare Experience Survey - discharge care Quarter 2 75% very positive experience 79.7% Victorian Healthcare Experience Survey - discharge care Quarter 3 75% very positive experience 70.8% Victorian Healthcare Experience Survey - patients perception of cleanliness Quarter 1 70% 73.7% Victorian Healthcare Experience Survey - patients perception of cleanliness Quarter 2 70% 83.7% Victorian Healthcare Experience Survey - patients perception of cleanliness Quarter 3 70% 73.2%

Healthcare associated infections (HAI's) Number of patients with surgical site infection No outliers No outliers

Adverse events Sentinel events - root cause analysis (RCA) reporting All RCA reports submitted within 30 business days Nil Unplanned readmission hip replacement Annual rate ≤2.5% Nil

Maternity and newborn Rate of singleton term infants without birth anomalies with Apgar Score <7 at 5 minutes ≤1.4% 1.4% Rate of severe foetal growth restriction (FGR) in singleton pregnancy undelivered by 40 weeks ≤28.6% 10.0% Proportion of urgent maternity patients referred for obstetric care to a level 4, 5 or 6 maternity service who were booked for a specialist clinic appointment within 30 days of accepted referral 100% 96.7%

36 West Gippsland Healthcare Group Annual Report 2019 Part B: Performance priorities

Strong Governance, leadership and culture

Key performance indicator Target Result Organisational culture* People Matter Survey - percentage of staff with a positive response to safety culture questions 80% 91% People Matter Survey - percentage of staff with a positive response to the question, "I am encouraged by my colleagues to report any patient safety concerns I may have." 80% 98% People Matter Survey - percentage of staff with a positive response to the question, "Patient care errors are handled appropriately in my work area." 80% 95% People Matter Survey - percentage of staff with a positive response to the question, "My suggestions about patient safety would be acted upon if I expressed them to my manager." 80% 93% People Matter Survey - percentage of staff with a positive response to the question, "The culture in my work area makes it easy to learn from the errors of others." 80% 88% People Matter Survey - percentage of staff with a positive response to the question, "Management is driving us to be a safety-centred organisation." 80% 91% People Matter Survey - percentage of staff with a positive response to the question, "The health service does a good job of training new and existing staff." 80% 81% People Matter Survey - percentage of staff with a positive response to the question, "Trainees in my discipline are adequately supervised." 80% 86% People Matter Survey - percentage of staff with a positive response to the question, "I would recommend a friend or relative to be treated as a patient here." 80% 91%

* Result is from survey conducted in 2018 and reported in quarter 1 Composite score of eight safety culture questions. Denominator excludes ‘Neither agree or disagree’ and ‘Don’t know’ responses

Timely access to care

Key performance indicator Target 2018-19 Result Emergency care Percentage of patients transferred from ambulance to emergency department within 40 minutes 90% 96% Percentage of Triage Category 1 emergency patients seen immediately 100% 100% Percentage of Triage Category 1 to 5 emergency patients seen within clinically recommended times 80% 73% Percentage of emergency patients with a length of stay less than four hours 81% 68% Number of patients with a length of stay in the emergency department greater than 24 hours 0 2

West Gippsland Healthcare Group Annual Report 2019 37 Part B: Performance priorities

Key performance indicator Target 2018-19 Result Elective surgery Percentage of Urgency Category 1 elective patients admitted within 30 days 100% 100% Percentage of Urgency Category 1, 2 and 3 elective patients admitted within clinically recommended time-frames 94% 91.8%* Percentage of patients on the waiting list who have waited longer than 5% or 15% 17.9%* clinically recommended time for their respective triage category proportional improvement from prior year

Number of patients on the elective surgery waiting list1 400 804* Number of hospital initiated postponements per 100 scheduled elective surgery admissions ≤7/100 11.6* Number of patients admitted from the elective surgery waiting list 2,640 2,354*

Specialist Clinics Percentage of urgent patients referred by a GP or external specialist who attended a first appointment within 30 days 100% 97.9% Percentage of routine patients referred by a GP or external specialist who attended a first appointment within 365 days 90% 99.7% 1 The target shown is the number of patients on the elective surgery waiting list as at 30 June 2019 *Due to a Force Majeure event - the unplanned closure of operating theatres in May and June impacted on elective surgery performance targets with the exception of urgent (category 1) patients who were referred to other health services during this period.

Effective Financial management

Key performance indicator Target 2018-19 Result Finance Operating result ($m) 0.00 (3.72) Average number of days to paying trade creditors < 60 days 47 days Average number of days to receiving patient fee debtors < 60 days 26 days Public & private WIES2 activity performance to target 100% 95%** Adjusted current asset ratio 0.7 or 3% 0.93 improvement from health service base target Forecast number of days a health service can maintain its operations with unrestricted available cash (based on end of year forecast) 14 days 27 Actual number of days a health service can maintain its operations with unrestricted available cash, measured on the last day of each month 14 days Achieved Measures the accuracy of forecasting the Net result from transactions (NRFT) for the current financial year ending 30 June Variance ≤ $250,000 Achieved **Due to a Force Majeure event - the unplanned closure of operating theatres in May and June, obstetrics, elective and emergency surgery were impacted causing a shortfall of 523 WIES equating to an under achievement of 5% of target. 2WIES is a Weighted Intre Equivalent Separation

38 West Gippsland Healthcare Group Annual Report 2019 Part C: Activity and funding

Acute Admitted Actual WIES Public 9,435 WIES Private 376 WIES DVA 73 WIES TAC 45

Acute Non-Admitted Home Enteral Nutrition 114 Specialist Clinics 17,677

Subacute & Non-Acute Admitted Subacute WIES - GEM Public 95 Subacute WIES - GEM Private 1 Subacute WIES - Palliative Care Public 25 Subacute WIES - Palliative Care Private 2 Subacute WIES - DVA 0

Subacute Non-Admitted Health Independence Program - Public 17,440

Aged Care Residential Aged Care 33,241 HACC 5,289

Primary Health Community Health / Primary Care Programs 6,106

Other Health Workforce 51

West Gippsland Healthcare Group Annual Report 2019 39 Key Performance Indicators

Five year WIES comparison

12000 11000 10000 9000 8000 7000 8172 8397 8824 8997 9929 9546 9667 9748 10451 6000 10176 5000 4000 3000 2000 1000 0 2014-15 2015-16 2016-17 2017-18 2018-19

Actual WIES Total Target WIES

WIES stands for Weighted Inlier Equivalent Separation. The Victorian Government uses WIES as their activity based case mix funding policy for public hospitals.

Each hospital admission is assigned a WIES value based on the Diagnosis Related Group (DRG) and length of stay.

40 West Gippsland Healthcare Group Annual Report 2019 Five year financial comparison

2019 2018 2017 2016 2015 $000 $000 $000 $000 $000 Operating Result (3,722)* 660 1,214 331 (1,043) Total Revenue 118,102 114,678 108,084 96,351 92,805 Total Expenditure 124,426 115,240 107,076 100,568 98,106 Net Result from Transaction (6,324) (562) 1,008 (4,217) (5,301) Total other Economic Flows 99 (104) 91 48 (200) Net Result (6,225) (666) 1,099 (4,169) (5,501) Total Assets 109,439 107,627 101,417 94,571 95,827 Total Liabilities 40,201 35,223 34,212 30,354 27,441 Total Equity 69,238 72,404 67,205 64,217 68,386

Reconciliation between the Net result from transactions reported in the model to the Operating result as agreed in the Statement of Priorities

2019 2018 2017 2016 2015 $000 $000 $000 $000 $000 Net Operating Result (3,722)* 660 1,214 331 (1,043) Capital and specific items Capital purpose income 4,676 5,349 6,094 2,249 2,394 Specific income - - 470 - - Assets provided free of charge - - - - - Assets received free of charge - 185 5 - - Expenditure for capital purpose (181) (261) (257) (406) (324) Depreciation and amortisation (7,097) (6,495) (6,518) (6,391) (6,328) Impairment of Non-Financial Assets - - - - - Finance costs - - - - - Net result from transactions (6,324) (562) 1,008 (4,217) (5,301)

*Events occurring after the balance sheet date On the 23rd July 2019, WGHG received a letter from the Department of Health and Human Services (DHHS) that confirmed the impact of the unplanned theatre closures from May to 30th June 2019 represented grounds for a force majeure event. As such, DHHS advised that it will waiver up to $2 million of Public/Private WIES that would otherwise be subject to recall for 2018-19. This will be adjusted through the Prior Year Adjustment process during 2019-20.

West Gippsland Healthcare Group Annual Report 2019 41 Logan Ginger and Simon Schreyer operating a drone to capture progress of construction projects.

42 West Gippsland Healthcare Group Annual Report 2019 Financial Report

The 2018-19 financial year delivered a disappointing financial The comprehensive result for 2018-19 was an overall loss result for the Group. WGHG recorded an operating loss of of $3.17m. This compares to a gain of $5.2m in 2017- $3.72m compared to an expected break-even budget. 18. Following a $5.86m revaluation increase to Land and Buildings at 30 June 2018, WGHG was required to A large contributing factor to the loss was the unplanned undertake an independent valuation of Land and Buildings closure of our operating theatres from early May 2019. as at 30 June 2019. This valuation is conducted by the This impacted on our elective surgery patient throughput Valuer General Victoria every five years in accordance with and ultimately our ability to achieve full year Weighted Inlier Financial Reporting Direction FRD103G. This valuation Equivalent Separation (WIES) target for the year and WIES resulted in a further net increment of $3.06m: comprising an funded revenue. increase of $4.2m to Buildings and a reduction of $1.1m to This underachievement of Public Private WIES amounted to Land. Combined, these past two valuations have seen a net 5% and the Financial Report has provided for this funding to increase of $8.9m to the Group’s Property Assets and has be recalled in accordance with the Department of Health & otherwise helped improve our net asset position. Human Services (DHHS) Policy and Funding guidelines. Cash reserves for the year reduced by $7.36m to $9.6m. Total revenue from transactions for the year was $118.1m, Whilst cash flows from operating activities continued to be representing an increase of $3.4m or 2.99%. Government strong (positive $3.76m), cash payments for construction grant revenue increased $3.46m to $93.9m. This increase projects and purchases of new and replacement plant and included additional WIES funding on 2017-18 plus increased equipment totalled $10.88m. These cash outflows were specified grant funding for nurses' and doctors' Enterprise expected and largely due to the payment of capital works on Bargaining Agreements (EBA) pay increases. site; being the short stay unit, third theatre and stage two accommodation units. The capital funding for these projects Total expenditure before capital items and depreciation was largely received in prior years. increased 8.1% to $116.98m. Employee expenses increased $8.4m or 10.33% and included fixed salary costs whilst On the back of reduced cash reserves, the liquidity ratio for theatres were closed plus the impact of the nurses EBA pay the Group has declined from 0.97 last year to 0.69 as at June and classification changes from April 2019. 2019. Net assets declined $3.1m to $69.2m.

Non-salary expenses included continued increases in The financial challenges experienced in the past two financial radiology tests and costs, higher patient ambulance transfer years are likely to extend into the year ahead and be even costs associated with theatre closures plus accounting for our more compounding. Revenue continues to grow at a lesser interest in the Gippsland Health Alliance joint operations loss rate than expenditure and 2019-20 will see new capacity for the year. and resources coming online as the short stay unit and third theatre open. The net result for the year after depreciation and other economic flows was a loss of $6.22m. This compared Diligent cash and liquidity management will be imperative as to a loss of $0.66m in 2017-18. Depreciation for the the Group’s cash holdings are expected to decline further, year increased 9.27% following the required managerial with final payments for the balance of capital works on site revaluation of Land and Buildings at 30 June 2018. expected to conclude in 2019-20.

Capital revenue included $2.6m in progress claims received Whilst WGHG is dependent on DHHS funding, WGHG is from DHHS under the Regional Health Infrastructure Fund extremely fortunate to have such a strong, generous and (RHIF) rounds primarily in relation to milestone achievements supportive community. Community donations for 2018-19 (construction contracts signed) for the short stay unit and totalled $1.35m. Community donations remain a vital source third theatre projects. of funding to the Group and help ensure we can continue to meet the health and wellbeing needs of our Community.

West Gippsland Healthcare Group Annual Report 2019 43 Environment Performance Summary 2018-2019

GREENHOUSE GAS EMISSIONS

Total greenhouse gas emissions (tonnes CO2e) 2016-2017 2017-2018 2018-2019 Scope 1 3,862 3,933 3,861 Scope 2 3,414 3,428 3,429 Total 7,277 7,361 7,290

Normalised greenhouse gas emissions 2016-2017 2017-2018 2018-2019 2 Emissions per unit of floor space (kgCO2e/m ) 288.43 291.76 288.96

Emissions per unit of separations (kgCO2e/separations) 587.15 557.58 537.49 Emissions per unit of bed-day (LOS+Aged Care Cooinda Lodge only)

(kgCO2e/OBD) 148.67 152.25 156.02

STATIONARY ENERGY Total stationary energy purchased by energy type (GJ) 2016-2017 2017-2018 2018-2019 Electricity 11,276 11,426 11,537 Natural Gas 74,956 76,320 74,925 Total 86,232 87,746 86,462 Electricity and gas consumption data is for the main hospital site only including the Warragul Linen Service. Total energy consumption reduced by 1.5% for the 2018-19 financial year. Gas consumption fell 1.8% due to repairs to the gas boilers. Higher electrical consumption included the impact of increased acute patient activity throughout the hospital (e.g. separations up 6.5%), coupled with major onsite construction works and extra labour onsite in the second half of the year associated with the new Short Stay Unit and third theatre builds. Despite these extra demands, WGHG continues to achieve its energy savings under its seven year Energy Performance Contract which commenced in May 2016.

Normalised stationary energy consumption 2016-2017 2017-2018 2018-2019 Energy per unit of floor space (GJ/m2) 3.42 3.48 3.43 Energy per unit of separations (GJ/separations) 6.96 6.65 6.37 Energy per unit of bed-day (LOS+Aged Care Cooinda only) (GJ/OBD) 1.76 1.82 1.85 Energy performance for 2018-19 relative to separations has improved as the consumption has decreased 1.5% despite increased activty and works on site. Energy performance for 2018-19 relative to bed days has declined as residential occupancy at Cooinda Lodge has declined 10.4%.

44 West Gippsland Healthcare Group Annual Report 2019 WATER Total water consumption by type (kL) 2016-2017 2017-2018 2018-2019 Potable Water 31,411 30,946 30,921 Total 31,411 30,946 30,921 Water consumption data is main hospital site only excluding Warragul Linen Service. Water usage declined 0.1% for the 2018- 19 period despite increased activity on site.

Normalised water consumption (Potable + Class A) 2016-2017 2017-2018 2018-2019 Water per unit of floor space (kL/m2) 1.25 1.23 1.23 Water per unit of separations (kL/separations) 2.53 2.34 2.28 Water per unit of bed-day (LOS+Aged Care OBD) (kL/OBD) 0.47 0.47 0.48

WASTE AND RECYCLING Waste (tonnes) 2016-2017 2017-2018 2018-2019 Total waste generated (clinical waste+ general waste+ recycling waste) 242 250 282 Total waste to landfill generated (clinical waste+ general waste) 208 212 230 Total waste to landfill per patient treated ((kg clinical waste+ kg general waste)/PPT. 2.06 2.07 2,26 Recycling rate % (recycling / (general waste + recycling)) 22.9% 20.9% 16.1% Total waste generated increased by 12.7% for 2018-19 and is reflective of increased general waste from increased patient and staffing numbers plus major building works on site involving building material removal. Whilst total waste increased, clinical waste consumption reduced by three and a half tonnes or 23.3% and is the result of greater education and focus around disposing of correct items in clinical waste bins.

Normalisers (for information only) 2016-2017 2017-2018 2018-2019 Area M2 25,228 25,228 25,228 Aged Care OBD 37,066 34,805 33,214 Aged Care OBD Cooinda Lodge only 19,150 17,179 15,392 ED departures 22,019 23,092 23,941 FTE 730 756 778 LOS 29,794 31,165 31,334 OBD 66,860 65,970 64,548 Separations 12,393 13,201 13,563 PPT (OBD + ED departures + separations) 101,272 102,263 102,052 Definitions: ED = Emergency Department OBD = Overnight Bed days FTE = Full Time Equivalent LOS = Length Of Stay PPT = Per Patient Treated

West Gippsland Healthcare Group Annual Report 2019 45 Reporting Requirements

Freedom of Information Under the Freedom of Information Act 1982 (the FOI Act) any Industry Capability Network (ICN) in June 2018. A person can ask to see documents held by the West Gippsland Competitive Tender was issued to INTREC to complete Healthcare Group. the building works. Upon recent review of INTREC’s Consumers wishing to access documents may contact the contestability commitment, INTREC reported 87.25% local Freedom of Information Officer at WGHG on 03 5623 0611. commitment. The FOI Officer is the Manager, Health Information Services with final approval by the Chief Medical Officer. Guidance can be provided on how to make a request, what format it should be in and any costs associated. Information is also available on the WGHG website: www/wghg.com.au under Patient Information. During the 2018-19 financial year, 79 requests for information under the regulations of the FOI Act were received. Access was granted in full to 77 applicants. A majority of requests (75) were made by the TAC and lawyers and four from the general public. Full Access...... 77 Stage 2 Accommodation Units were built through donations from the community and the Andrews Partial Access...... 0 Foundation to attract visiting medical specialists to our Denied...... 0 health service. Withdrawn...... 0 No Documents...... 0 National Competitive Policy Not yet finalised...... 2 It is Government policy that the costing policies of publicly TOTAL...... 79 funded organisations should reflect any competitive advantage available to the private sector. During 2018/19 all competitive neutrality requirements were met. Local Jobs First In August 2018, the Victorian Parliament reformed the Conformity & Building Maintenance Victorian Industry Participation Policy Act (VIPP) 2003 into the All renovations to existing buildings are assessed for Local Jobs First Act 2003. conformance to the Building Act 1993, including relevant The policy aims to promote employment and business growth provisions of the National Construction Code. The construction by expanding market opportunities for local industry. project assessment form ensures conformity to the Act and enables early identification of asbestos and/or other Under the Act, WGHG is required to apply the Local Jobs First Workplace Health and Safety (WHS) risk that may require policy for all procurement activities valued at $1million or controls prior to commencement of works. Where necessary, more in regional Victoria. an independent building inspector is engaged to ensure During 2018-19, WGHG commenced two regional applicable compliance with the Building Act 1993. procurement activities: All existing buildings complied with regulations in force at the 1) The construction of a five unit accommodation dwelling at time of construction. There were no emergency orders nor Sargeant Street at an expected cost of $1.2M. The project building orders to cease occupancy or to undertake urgent is local by nature. The outcomes to date are as follows: works. • An average of 85.46% local content commitment was made All sites are subject to a Fire Safety Audit and Risk • A total of 45 jobs were committed including the retention of Assessment according to revised standards as directed by 43 and creation of 2 new apprentices/trainees the Department of Health and Human Services ( DHHS) and WGHG confirm certification as required under DHHS Capital 2) Design and construction of an eight bed Short Stay Unit Development Guidelines - Series 7 Fire Risk Management, and third Operating Theatre (extensions to the main dated August 2013: Fire Risk Management, specifically 7.6: hospital building). This activity was registered with the Fire Risk Management for Hospitals.

46 West Gippsland Healthcare Group Annual Report 2019 Reporting Requirements

Buildings The following major building projects were under construction Total ICT expenditure is made up of Business as Usual (BAU) with building permits issued in 2018-19 and are subject to and Non Business as usual (NBAU) expenditure: conditions and inspections under the Buildings Act 1993: a. Business As Usual (BAU) expenditure – includes all • Construction of a five unit accommodation dwelling at remaining ICT expenditure other than Non-BAU ICT 6 Sargeant Street, Warragul. These works included the expenditure and typically relates to ongoing activities to demolition of the existing Breast Feeding Education building operate and maintain the current ICT capability. (asbestos clearance certificate obtained) b. Non-Business As Usual (Non-BAU) expenditure – is a • Design and Construction of an eight bed Short Stay Unit subset of ICT expenditure that relates to extending or and third Operating Theatre (extensions to the main hospital enhancing current ICT capabilities and are usually run as building) projects. No occupancy permits or certificates of final inspection were The total ICT expenditure incurred during 2018-19 is $2.92m issued during the year in relation to buildings owned by (excluding GST) with the details shown below. This includes WGHG. Certificate of Occupancy for both of the major building WGHG's annual membership contribution to core and non- projects was achieved in July 2019 and will appear in the next Annual Report. core services of the Gippsland Health ICT Alliance (GHA). WGHG purchased a commercial property at 8 Contingent Expenditure ($ '000) Street, Trafalgar in October 2018. This property has been Business added to the WGHG asset list. As Usual (BAU) ICT Non-BAU ICT expenditure Maintenance expenditure An extensive refresh of our current operating theatres was Total Total=Operational Operational Capital completed 2018-19. expenditure and expenditure expenditure (excluding Capital Expenditure (excluding (excluding The Asset Management Strategy was updated with WGHG GST) (excluding GST) (a) GST) (a) GST) (b) intending to submit applications for infrastructure grants + (b) under the DHHS funding rounds to undertake identified major works and enable continued safe and effective operations on 2,595 327 267 60 existing site. Carers Recognition Act 2012 No notice for urgent rectification, attention or major The Carers Recognition Act 2012 acknowledges and values expenditure was received. the role of carers and the importance of care relationships in A Preventative Maintenance program is in place. the Victorian community. Carers may be a consumer or patient’s next of kin, a Details of Information and guardian, family member, delegated community member or Communication Technology (ICT) significant other as nominated. WGHG recognises the principles of the Act and has Expenditure incorporated these into policies including Person Centred ICT expenditure represents an entity’s costs in providing Care and our Community Participation Plan. business-enabling ICT services and consists of the following WGHG takes all practicable measures to ensure that cost elements: employees and agents reflect the care relationship principles • Operating and capital expenditure (including in developing, providing or evaluating support and assistance depreciation); for persons in care relationships. • ICT services – internally and externally sourced; • Cost in providing ICT services (including personnel & facilities) across the agency, whether funded through a central ICT budget or through other budgets; and • Cost in providing ICT services to other organisations.

West Gippsland Healthcare Group Annual Report 2019 47 Reporting Requirements

Protected Disclosure Act 2012 Safe Patient Care Act (2015) West Gippsland Healthcare Group complies with the Protected West Gippsland Healthcare Group complies with the Safe Disclosure Act 2012 which supports staff to disclose improper Patient Care (Nurse to Patient and Midwife to Patient Ratios) or corrupt conduct. Act. The legislation ensures the number of nurses and midwives per patient is preserved and protected. WGHG has a Protected Disclosure Policy available to staff on the WGHG intranet or via the Executive Office. The Chief During 2018-19, WGHG had no matters to report in relation to its Executive Officer is the Protected Disclosure Coordinator obligations under section 40 of the Safe Patient Care Act 2015. for the purpose of the Protected Disclosure Act. There were no complaints made under the Act against West Gippsland Healthcare Group or its staff for 2018-19.

Consultancies Disclosure Details of consultancies over $10,000 In 2018-19, there were four consultancies where the total fees payable to the consultants were less than $10,000. The total expenditure incurred during 2018-19 in relation to these consultancies is $20,358 (excl. GST). Details of consultancies (valued at $10,000 or greater) In 2018-19, there were eight consultancies where the total fees payable to the consultants were $10,000 or greater. The total expenditure incurred during 2018-19 in relation to these consultancies is $654,007 (excl. GST). Expenditure Future Start End 2018-19 expenditure Consultant Purpose of Consultancy date date (excluding (excluding GST) $'000 GST) $'000 Professional coaching services sessions The Tilbury Group Pty Ltd Jul-18 Jun-19 118 28 provided to Management Three year program for professional coaching Studer Group Jul-18 Jun-19 100 68 and leadership advisory services Services for Sterilisers replacement and Schneider Electric Jul-18 Jun-19 39 21 kitchen plant upgrade (RHIF round 3) Batman Discretionary Review of Aged Care Funding Instrument Oct-18 Mar-19 115 Nil Trust (Provider Assist) (ACFI) Consultant advice on National Safety and Graylin Pty Ltd Jun-19 Jun-19 11 Nil Quality Standards Preparation Synchronicity Consulting Strategic Planning Facilitator - Board Mar-19 Jun-19 15 Nil Pty Ltd Planning day Project Manager (PM), Principal Architect Johnstaff Pty Ltd (PM), (PA), Quantity Surveyor (QS), Building Lyons (PA), Altus Group Surveyor (BS), Hospital Equipment (QS), BSA Building Consultant (HES), Engineeering Services Jun-18 Jun-19 227 93 Surveyors (BS), HEPA (ES) - Consultant team (Regional Health (HES), Watermans (ES) Infrastructure Fund Round 1) 8 Bed Short Stay and Theatre Development Projects

Wise Workplace Investigation and Quality Review Jul-18 Dec-18 31 Nil

48 West Gippsland Healthcare Group Annual Report 2019 Additional Information available on request

Consistent with FRD 22H (Section 5.19) the report of (g) Details of overseas visits undertaken including a summary operations confirms that details in respect of the items listed of the objectives and outcomes of each visit below have been retained by West Gippsland Healthcare (h) Details of major promotional, public relations and Group and are available to the relevant Ministers, Members of marketing activities undertaken by the Health Service to Parliament and the public on request (subject to the Freedom develop community awareness of the Health Service and of Information requirements, if applicable): its services (a) Declarations of pecuniary interests have been duly (i) Details of assessments and measures undertaken to completed by all relevant officers improve the occupational health and safety of employees (b) Details of shares held by senior officers as nominee or (j) General statement on industrial relations within the held beneficially Health Service and details of time lost through industrial (c) Details of publications produced by the entity about itself, accidents and disputes, which is not otherwise detailed in and how these can be obtained the report of operations (d) Details of changes in prices, fees, charges, rates and (k) A list of major committees sponsored by the Health levies charged by the Health Service Service, the purposes of each committee and the extent to (e) Details of any major external reviews carried out on the which those purposes have been achieved Health Service (l) Details of all consultancies and contractors including (f) Details of major research and development activities consultants/contractors engaged, services provided, and undertaken by the Health Service that are not otherwise expenditure committed for each engagement covered either in the report of operations or in a document that contains the financial statements and report of Photo: Volunteer Jim Willshire (right) enjoys a chat with operations Cooinda resident Kris Penco and Manager Tammi Thomas.

West Gippsland Healthcare Group Annual Report 2019 49 Attestations

Financial Management Compliance Conflict of Interest I, Christine Holland, on behalf of the Responsible Body, certify I, Dan Weeks, certify that the West Gippsland Healthcare that the West Gippsland Healthcare Group has complied with Group has put in place appropriate internal controls the applicable Standing Directions 2018 under the Financial and processes to ensure that it has complied with the Management Act 1994 and Instructions. requirements of hospital circular 07/2017 Compliance reporting in health portfolio entities (Revised) and has implemented a ‘Conflict of Interest’ policy consistent with the minimum accountabilities required by the VPSC. Declaration of private interest forms have been completed by all executive staff within West Gippsland Healthcare Group and members of Christine Holland the board, and all declared conflicts have been addressed and Board Chair are being managed. Conflict of interest is a standard agenda Warragul item for declaration and documenting at each executive board 11th September 2019 meeting.

Data Integrity I, Dan Weeks, certify that the West Gippsland Healthcare Group has put in place appropriate internal controls and processes to ensure that reported data accurately reflects actual Dan Weeks performance. West Gippsland Healthcare Group has critically Chief Executive Officer reviewed these controls and processes during the year. Warragul 11th September 2019

Compliance with Health Purchasing Victoria Dan Weeks (HPV) Health Purchasing Policies Chief Executive Officer I, Dan Weeks certify that the West Gippsland Healthcare Warragul Group has put in place appropriate internal controls and 11th September 2019 processes to ensure that it has complied with all require- ments set out in the HPV Health Purchasing Policies including Integrity, Fraud and Corruption mandatory HPV collective agreements as required by the I, Dan Weeks, certify that West Gippsland Healthcare Group Health Services Act 1988 (Vic) and has critically reviewed has put in place appropriate internal controls and processes these controls and processes during the year. to ensure that integrity, fraud and corruption risks have been reviewed and addressed at West Gippsland Healthcare Group during the year.

Dan Weeks Chief Executive Officer Warragul Dan Weeks 11th September 2019 Chief Executive Officer Warragul 11th September 2019

50 West Gippsland Healthcare Group Annual Report 2019 Board Directors', Chief Executive Officer's and Chief Finance and Accounting Officer's declaration

West Gippsland Healthcare Group Annual Report 2019 51

Independent Auditor’s Report

To the Board of West Gippsland Healthcare Group

pinion I have audited the financial report of West Gippsland Healthcare Group (the health service) Independentwhich Auditor’s comprises the: Report • balance sheet as at 30 June 2018 To the Board of West Gippsland Healthcare Group • comprehensive operating statement for the year then ended pinion I haehave •audited statement the financial of changes reortreport ofin estWestequity islandGippsland for the year ealthcareHealthcare then ended rouGroup the(the health sericeservice) hichwhich •corisescomprises cash thethe: flow statement for the year then ended • • alancebalance notes sheet to as the at financial 30 uneJune 12018statements, including significant accounting policies • • corehensiecomprehensive board member's, oeratingoperating accountable statementstateent officer'sfor the earyear and thenchief endedfinance & accounting officer's • stateentstatementdeclaration of changes. in euitequity for the earyear then ended • Incash my floflow opinion stateentstatement the financial for the report earyear then presents ended fairly, in all material respects, the financial • positionnotes to ofthe the financial health staserviceteentstements, as at including30 June 2 significantsignif018 andicant their accounting financial oliciespolicies performance and cash • flowsoardboard for member's,directors the year accountale accountablethen ended in officersofficer's accordance and chiefchie withf financethe financial & accounting reporting officer'sofficers requirements of Partdeclaration 7 of the. Financial anaeent Act and applicable Australian Accounting Standards. nIn my oinionopinion the financial reortreport resentspresents fairlfairly, in all aterialmaterial resectsrespects, the financial sis or ositionpositionI have of the conducted health sericeservice my audit as at in 30 accordance uneJune 12018 with and thetheir Audit financial Act erforanceperformance which incorporates and cash the pinion flosflows forAustralian the earyear Auditing then eendednded Standards. in accordance I further withith describe the financial my responsibilities reportingreorting requirementsreuireents under that Act of and Part 7 thoseof the standards Financial Managementanaeentin the Auditor’s Act Responsibilities 1994 and alicaleapplicable for the Australian Audit of the Accounting Financial Report section StandardsStandards.of my report.

sis or I haehave Myconducted independence my audit is establishedin accordance by ithwiththe onstitution the Audit Act Act 1994 hichwhich My incororatesincorporatesstaff and I are the pinion Australianindependent Auditing StandardsStandards.of the health I further service descriedescribe in accordance my resonsiilitiesresponsibilities with the ethical under requirements that Act and of the those standardsAccounting in Professional the Auditor’s and Responsibilities Ethical Standards for the Board’s Audit APESof the 110 Financial ode of Report thics section for of my reortreport.rofessional Accountants (the Code) that are relevant to my audit of the financial report in Victoria. My staff and I have also fulfilled our other ethical responsibilities in accordance My indeendenceindependence is estalishedestablished by the Constitutiononstitution Act 1975. My staff and I are with the Code. indeendentindependent of the health sericeservice in accordance ithwith the ethical reuireentsrequirements of the AccountingI believe Professional that the audit and Ethical evidence Standards I have obtained Board’s APESis sufficient 11101 Codeode and of appropriate Ethicsthics for to provide a Professionalrofessionalbasis for Accountants my opinion. the(the odeCode) that are releantrelevant to my audit of the financial reortreport in ictoriaVictoria. My staff and I haehave also fulfilled our other ethical resonsiilitiesresponsibilities in accordance ord’s The Board of the health service is responsible for the preparation and fair presentation of ithwith the odeCode. responsiiities the financial report in accordance with Australian Accounting Standards and the Financial or te I elieebelieveanaeent that the audit Act eidencevidence , ande I haehave for such otainedobtained internal is sufficient control as and the aroriateappropriate Board determine to roideprovides is necess a ary inni asisbasis forto enablemy oinionopinion. the preparation and fair presentation of a financial report that is free from report material misstatement, whether due to fraud or error. ord’s heThe Board of the health sericeservice is resonsileresponsible for the rearationpreparation and fair resentationpresentation of responsiiities the financialIn preparing reortreport the in accordaccordance financialance report, ithwith Australianthe Board isAccounting responsible Standards for assessing and the the Financial health service ’s or te Managementanaeentability to Act cont 1994inue, and as a for going such concern, internal disclosing, control as asthe applicable, Board deterinedetermine matterss relatedis necessarnecess toary going inni to enaleenableconcern the rearationpreparation and using the and going fair resentationpresentationconcern basis of of a accounting financial reortreport unless that it is is inappropriate free frofrom to do so. report aterialmaterial isstateenmisstatement,t hetherwhether due to fraud or errorerror. nIn rearingpreparing the financial reortreport, the Board is resonsileresponsible for assessing the health sericeservice’s ailitability to continuecontinue as a going concernconcern, disclosingdisclosing, as alicaleapplicable, attersmatters related to going concern and using the going concern asisbasis of accounting unless it is inaroriateinappropriate to do soso.

52 West Gippsland Healthcare Group Annual Report 2019

Auditor’s As reuired the Audit Act resonsiilit is to eress an oinion on the financial rsosiiitis reort ased on the audit oecties for the audit are to otain reasonale assurance or t udit aout hether the financial reort as a hole is free fro aterial isstateent hether o t ii due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable rort assurance is a high leel of assurance ut is not a guarantee that an audit conducted in accordance ith the Australian Auditing Standards ill alas detect a aterial isstateent hen it eists isstateents can arise fro fraud or error and are considered aterial if indiiduall or in the aggregate the could reasonal e eected to influence the econoic decisions of users taen on the asis of this financial reort As art of an audit in accordance ith the Australian Auditing Standards eercise rofessional udgeent and aintain rofessional sceticis throughout the audit also

• identif and assess the riss of aterial isstateent of the financial reort hether due to fraud or error design and erfor audit rocedures resonsie to those riss and otain audit eidence that is sufficient and aroriate to roide a asis for oinion he ris of not detecting a aterial isstateent resulting fro fraud is higher than for one resulting fro error as fraud a inole collusion forger intentional oissions isreresentations or the oerride of internal control • otain an understanding of internal control releant to the audit in order to design audit rocedures that are aroriate in the circustances ut not for the urose of eressing an oinion on the effectieness of the health serice’s internal control • ealuate the aroriateness of accounting olicies used and the reasonaleness of accounting estiates and related disclosures ade the Board • conclude on the aroriateness of the Board’s use of the going concern basis of accounting and ased on the audit eidence otained hether a aterial uncertaint eists related to eents or conditions that a cast significant dout on the health serice’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial reort or if such disclosures are inadeuate to odif oinion conclusions are ased on the audit eidence otained u to the date of my auditor’s report. However, future events or conditions may cause the health serice to cease to continue as a going concern • ealuate the oerall resentation structure and content of the financial reort including the disclosures and hether the financial reort reresents the underling transactions and eents in a anner that achiees fair resentation counicate ith the Board regarding aong other atters the lanned scoe and tiing of the audit and significant audit findings including an significant deficiencies in internal control that identif during audit

EBE rais erricott 1 Seteer 1 as deleate for the Auditoreneral of ictoria

West Gippsland Healthcare Group Annual Report 2019 53

54 West Gippsland Healthcare Group Annual Report 2019 Financial Index

Contents Page

Comprehensive Operating Statement...... 56 Balance Sheet ...... 57 Statement of Changes in Equity...... 58 Cash Flow Statement...... 59 Notes to the Financial Statements ...... 60-117 Glossary of Terms and Style Conventions.... 119-121 Disclosure Index...... 122

West Gippsland Healthcare Group Annual Report 2019 55 Comprehensive Operating Statement For the financial year ended 30 June 2019 ComprehensiveComprehensive Operating Operating Statement Statement

20192019 20182018 $'000$'000 $'000$'000 IncomeIncome from from Transactions Transactions OperatingOperating Activities Activities 2.1 2.1 117,534 117,534 114,166 114,166 Non-operatingNon-operating Activities Activities 2.1 2.1 568 568 512 512 TotalTotal Income Income from from Transactions Transactions 118,102 118,102 114,678 114,678

ExpensesExpenses from from Transactions Transactions EmployeeEmployee Expenses Expenses 3.1 3.1 (90,094) (90,094) (81,660) (81,660) SuppliesSupplies and consumablesand consumables 3.1 3.1 (14,897) (14,897) (14,998) (14,998) FinanceFinance costs costs 3.1 3.1 (81) (81) (7) (7) DepreciationDepreciation and Amortisationand Amortisation 4.4 4.4 (7,097) (7,097) (6,495) (6,495) OtherOther Operating Operating Expenses Expenses 3.1 3.1 (12,257) (12,257) (12,080) (12,080) TotalTotal Expenses Expenses from from Transactions Transactions (124,426) (124,426) (115,240) (115,240)

Net ResultNet Result from from Transactions Transactions - Net - OperatingNet Operating Balance Balance (6,324) (6,324) (562) (562)

OtherOther Economic Economic Flows Flows included included in Net in ResultNet Result Net Gain/(Loss)Net Gain/(Loss) on Sale on Saleof Non-Financial of Non-Financial Assets Assets 3.2 3.2 21 21 (60) (60) Net Gain/(Loss)Net Gain/(Loss) on Financial on Financial Instruments Instruments at Fair at ValueFair Value 3.2 3.2 (132) (132) - - OtherOther Gain/(Loss) Gain/(Loss) from from Other Other Economic Economic Flows Flows 3.2 3.2 210 210 (44) (44) TotalTotal Other Other Economic Economic Flows Flows included included in Net in ResultNet Result 99 99 (104) (104)

Net ResultNet Result for the for yearthe year (6,225) (6,225) (666) (666)

OtherOther Comprehensive Comprehensive Income Income

ItemsItems that thatwill notwill benot reclassified be reclassified to Net to ResultNet Result ChangesChanges in Property, in Property, Plant Plant and Equipmentand Equipment Revaluation Revaluation Surplus Surplus 4.2(b)4.2(b) 3,059 3,059 5,865 5,865

TotalTotal Other Other Comprehensive Comprehensive Income Income 3,059 3,059 5,865 5,865

ComprehensiveComprehensive result result for the for yearthe year (3,166) (3,166) 5,199 5,199

This ThisStatement Statement should should be read be readin conjunction in conjunction with withthe accompanying the accompanying notes. notes.

56 West Gippsland Healthcare Group Annual Report 2019 Balance Sheet AsWest at 30 Gippsland June 2019 Healthcare Group Balance Sheet as at 30 June 2019

Note 2019 2018 $'000 $'000 Current Assets Cash and Cash Equivalents 6.2 9,631 16,994 Receivables 5.1 2,469 2,620 Investments and Other Financial Assets 4.1 11,262 9,154 Inventories 301 293 Other Assets 509 534 Total Current Assets 24,172 29,595

Non-Current Assets Receivables 5.1 1,106 548 Property, Plant and Equipment 4.2 84,161 77,484 Total Non-Current Assets 85,267 78,032 TOTAL ASSETS 109,439 107,627

Current Liabilities Payables 5.2 8,785 7,341 Borrowings 6.1 683 629 Provisions 3.4 15,919 14,847 Other Liabilities 5.3 9,771 7,659 Total Current Liabilities 35,158 30,476

Non-Current Liabilities Borrowings 6.1 1,702 2,131 Provisions 3.4 3,342 2,616 Total Non-Current Liabilities 5,044 4,747 TOTAL LIABILITIES 40,202 35,223 NET ASSETS 69,238 72,404

EQUITY Property, Plant and Equipment Revaluation Surplus 4.2(f) 56,710 53,651 Contributed Capital 32,522 32,522 Accumulated Deficits (19,994) (13,769) TOTAL EQUITY 69,238 72,404

This Statement should be read in conjunction with the accompanying notes.

West Gippsland Healthcare Group Annual Report 2019 57 StatementWest Gippsland of Healthcare Changes Group in Equity West GippslandWestStatement Healthcare Gippsland of Group Changes Healthcare in GroupEquity Statement of ForStatementChangesFor thethe financial Financial in ofEquity Changes year Year ended Ended in Equity 30 30 June June 2019 2019 For the FinancialFor Year the Ended Financial 30 June Year 2019 Ended 30 June 2019 Property, Plant Contributed Accumulated Total Property, Plant ContributedProperty,and PlantAccumulated Equipment Contributed CapitalTotalAccumulated DeficitsTotal and Equipment Capitaland EquipmentRevaluationDeficits Capital Deficits Revaluation RevaluationSurplus Surplus Surplus

Note $'000 $'000 $'000 $'000 Note $'000 Note $'000$'000 $'000$'000 $'000$'000 $'000 Balance at 1 July 2017 47,786 32,522 (13,103) 67,205 Balance at 1 July 2017Balance at 1 July 2017 47,786 32,52247,786 (13,103)32,522 67,205(13,103) 67,205 Net result for the yearNet resultresult for for the the year year - - - (666) - - (666) - (666) (666)(666) (666) Other comprehensiveOther income comprehensive comprehensive for the year income income for thefor yearthe year 5,865 -5,865 5,865 - - 5,865 - - 5,865 - 5,865 Balance at 30 June Balance2018 at at 30 30 June June 2018 2018 53,651 32,52253,651 53,651(13,769)32,522 72,40432,522(13,769) (13,769)72,404 72,404 Net result for the yearNet resultresult for for the the year year - - - (6,225) - - (6,225)(6,225) - (6,225)(6,225) (6,225) Other comprehensiveOther income comprehensive comprehensive for the year income income for thefor yearthe year 3,059 -3,059 3,059 - - 3,059 - - 3,059 - 3,059 Balance at 30 June Balance2019 at at 30 30 June June 2019 2019 56,710 32,52256,710 56,710(19,994)32,522 69,23832,522(19,994) (19,994)69,238 69,238

This Statement shouldThis be Statementread in conjunction should be with read the in accompanyingconjunction with notes. the accompanying notes. This Statement should be read in conjunction with the accompanying notes.

58 West Gippsland Healthcare Group Annual Report 2019 Cash Flow Statement West Gippsland Healthcare Group ForCash the Flowfinancial Statement year ended 30 June 2019 For the Financial Year Ended 30 June 2019

Note 2019 2018 $'000 $'000 Cash Flows from Operating Activities Operating Grants from Government 90,542 87,282 Capital Grants from Government 3,893 3,814 Other Capital Receipts 1,255 1,359 Patient Fees Received 3,583 3,756 Private Practice Fees Received 765 631 GST Received from ATO 1,722 1,147 Interest and Investment Income Received 570 517 Other Receipts 18,796 18,550 Total Receipts 121,126 117,056 Employee Expenses Paid (81,437) (73,905) Payments for Supplies and Consumables (29,110) (29,281) Other Payments (6,820) (6,416) Total Payments (117,367) (109,602) Net Cash Flows from Operating Activities 8.1 3,759 7,454

Cash Flows from Investing Activities Purchase of Non-Financial Assets (10,876) (2,891) Proceeds from Disposal of Non-Financial Assets 182 31 Net Cash Flows used in Investing Activities (10,694) (2,860)

Cash Flows from Financing Activities Repayment of Borrowings (428) (629) Net Cash Flows from Financing Activities (428) (629)

Net (Decrease)/Increase in Cash and Cash (7,363) 3,964 Equivalents Held Cash and Cash Equivalents at Beginning of Year 16,994 13,030 Cash and Cash Equivalents at End of Year 6.2 9,631 16,994

This Statement should be read in conjunction with the accompanying notes.

West Gippsland Healthcare Group Annual Report 2019 59 Notes to the financial statements 30 June 2019

Notes to the Financial Statements West Gippsland Healthcare Group for the financial year ended 30 June 2019

Basis of Preparation

These financial statements are in Australian dollars and the historical cost convention is used unless a different measurement basis is specifically disclosed in the note associated with the item measured on a different basis. The accrual basis of accounting has been applied in preparing these financial statements, whereby assets, liabilities, equity, income and expenses are recognised in the reporting period to which they relate, regardless of when cash is received or paid.

60 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Notes to the Financial Statements West Gippsland Healthcare Group for the financial year ended 30 June 2019

Note 1: Summary of Significant Accounting Policies

These annual financial statements represent the audited general purpose financial statements for West Gippsland Heatlhcare Group and its controlled entities for the year ended 30 June 2019. The report provides users with information about West Gippsland Healthcare Group’s stewardship of resources entrusted to it.

(a) Statement of Compliance These financial statements are general purpose financial statements which have been prepared in accordance with the Financial Management Act 1994 and applicable AASBs, which include interpretations issued by the Australian Accounting Standards Board (AASB). They are presented in a manner consistent with the requirements of AASB 101 Presentation of Financial Statements. The financial statements also comply with relevant Financial Reporting Directions (FRDs) issued by the Department of Treasury and Finance, and relevant Standing Directions (SDs) authorised by the Assistant Treasurer. West Gippsland Healthcare Group is a not-for-profit entity and therefore applies the additional AUS paragraphs applicable to "not-for-profit" Health Service under the AASBs.

(b) Reporting Entity The financial statements include all the controlled activities of West Gippsland Healthcare Group. Its principal address is: 41 Landsborough Street Warragul, Victoria 3820

A description of the nature of West Gippsland Healthcare Group’s operations and its principal activities is included in the report of operations, which does not form part of these financial statements.

(c) Basis of Accounting Preparation and Measurement Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is reported. The accounting policies have been applied in preparing the financial statements for the year ended 30 June 2019, and the comparative information presented in these financial statements for the year ended 30 June 2018. The financial statements are prepared on a going concern basis (refer to Note 8.9 Economic Dependency). These financial statements are presented in Australian dollars, the functional and presentation currency of West Gippsland Healthcare Group. All amounts shown in the financial statements have been rounded to the nearest thousand dollars, unless otherwise stated. Minor discrepancies in tables between totals and sum of components are due to rounding West Gippsland Healthcare Group operates on a fund accounting basis and maintains three funds: Operating, Specific Purpose and Capital Funds. The West Gippsland Healthcare Group Capital and Specific Purpose Funds include unspent donations and receipts from fund-raising activities conducted solely in respect of these funds.

The financial statements, except for cash flow information, have been prepared using the accrual basis of accounting. Under the accrual basis, items are recognised as assets, liabilities, equity, income or expenses when they satisfy the definitions and recognition criteria for those items, that is, they are recognised in the reporting period to which they relate, regardless of when cash is received or paid.

West Gippsland Healthcare Group Annual Report 2019 61 Notes to the financial statements 30 June 2019

os o s s Gpps r Group or r u

Note 1: Summary of Significant Accounting Policies (cont'd)

us ss ssupos r rur o ou rr us o sss s r o r ppr ro or sours ss ur ssupos r r o oo ss ss sso ssupos r s o prosso us r ro sor pr rous or ors r o rso ur russ u rsus r ro s ss

sos o ou ss r ros pro s s rs uur pros r rso us ssupos ppo o s s s o ss ss r o • r u o us p up rr o o ropr up • Defined benefit superannuation expense (refer to Note 3.5 Superannuation); and • po prosos r s o ur o s s prs o s uur sr os uur sou rs rr o o po s

Goods and Services Tax (GST) o pss sss r ros o ou o sso G uss G urr s o ror ro usr o s s G p s ros s pr o os o uso o ss or s pr o ps s ps r s us o ou o G r or p ou o G ror ro or p o s u or rs or ps s os r prs o ross ss G opos o s os rs ro s or s r ror ro or p o r prs s opr s o os o sss s r prs o ross ss

(d) Jointly Controlled Operation

o oro s oru r sr o oro o rr ss o sos ou r s rur uous os o prs sr oro rsp o rs o opros s Gpps r Group ross ss • its assets, including its share of any assets held jointly; • any liabilities including its share of liabilities that it had incurred; • its revenue from the sale of its share of the output from the joint operation; • its share of the revenue from the sale of the output by the operation; and • its expenses, including its share of any expenses incurred jointly. s Gpps r Group s r o Gpps rs o oro or rr s ss s o opro rr o o o oro pros

Intersegment Transactions rsos ss s Gpps r Group o r o s Gpps r Groups opros s roup

62 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Notes to the inancial Statements est ippsland ealthcare roup for the financial year ended 3 une

Note 1: Summary of Significant Accounting Policies (cont'd)

(e) Equity onsistent ith the reuirements of S ontributions, contributions by oners (that is, contributed capital and its repayment) are treated as euity transactions and, therefore, do not form part of the income and expenses of the est ippsland ealthcare roup. ransfers of net assets arising from administrative restructurings are treated as distributions to or contributions by oners. ransfers of net liabilities arising from administrative restructurings are treated as distributions to oners. ther transfers that are in the nature of contributions or distributions or that have been designated as contributed capital are also treated as contributed capital. Specific Restricted Purpose Surplus he Specific estricted urpose Surplus is established here est ippsland ealthcare roup has possession or title to the funds but has no discretion to amend or vary the restriction andor condition underlying the funds received.

(f) Comparatives here applicable, the comparative figures have been restated to align ith the presentation in the current year. igures have been restated at Notes ., 3., 3., ., 5. and 5..

West Gippsland Healthcare Group Annual Report 2019 63 Notes to the financial statements 30 June 2019

Notes to the inancial Statements est ippsland ealthcare roup for the financial year ended 3 une

Note 2: Funding delivery of our services

est ippsland eatlhcare roups overall objective is to provide uality health services that meet the needs of omen and neborn babies; especially those reuiring specialist care. est ippsland eatlhcare roup is predominantly funded by accrual based grant funding for the provision of outputs. est ippsland ealthcare roup also receives income from the supply of services.

Structure . ncome from ransactions

64 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Notes to the inancial Statements est ippsland ealthcare roup for the financial year ended 3 une

Note 2.1: Income from Transactions

Total Total 2019 2018 $'000 $'000

overnment rants perating , ,3 overnment rants apital 3,3 3, ther apital purpose income (including capital donations) ,55 ,35 atient and esident ees 3, 3,53 rivate ractice ees ommercial ctivities 3, 3,535 ssets received free of charge or for nominal consideration 5 ther evenue from perating ctivities (including noncapital donations) , 5,3 Total Income from Operating Activities 117,534 114,166

ther nterest 5 5 Total Income from Non-Operating Activities 568 512

Total Income from Transactions 118,102 114,678

. ommercial activities represent business activities hich health service enter into to support their operations.

Revenue Recognition ncome is recognised in accordance ith S evenue and is recognised as to the extent that it is probable that the economic benefits ill flo to est ippsland ealthcare roup and the income can be reliably measured at fair value. nearned income at reporting date is reported as income received in advance. mounts disclosed as revenue are, here applicable, net of returns, alloances, duties and taxes.

Government Grants and Other Transfers of Income (other than contributions by owners)

n accordance ith S ontributions, government grants and other transfers of income (other than contributions by oners) are recognised as income hen est ippsland ealthcare roup gains control of the underlying assets irrespective of whether conditions are imposed on West Gippsland Healthcare Group’s use of the contributions. he Department of ealth and uman Services maes certain payments on behalf of est ippsland ealthcare roup. hese amounts have been brought to account as grants in determining the operating result for the year by recording them as revenue. ontributions are deferred as income in advance hen est ippsland ealthcare roup has a present obligation to repay them and the present obligation can be reliably measured.

Non-cash contributions from the Department of Health and Human Services

he Department of ealth and uman Services maes some payments on behalf of health services as follos • he ictorian anaged nsurance uthority nonmedical indemnity insurance payments are recognised as revenue folloing advice from the Department of ealth and uman Services • ong Service eave (S) revenue is recognised upon finalisation of movements in S liability in line ith the long service leave funding arrangements set out in the relevant Department of ealth and uman Services ospital ircular

Patient and Resident Fees atient and resident fees are recognised as revenue on an accrual basis. Private Practice Fees rivate practice fees are recognised as revenue at the time invoices are raised, and include recoupments from private practice for the use of hospital facilities. Revenue from Commercial Activities evenue from commercial activities such as car par and property rental income are recognised on an accrual basis.

West Gippsland Healthcare Group Annual Report 2019 65 Notes to the financial statements 30 June 2019

otes to the inancial tatements West Gippsland Healthcare Group for the financial ear ended une

Note 2.1: Income from Transactions (cont'd)

Fair value of assets and services received free of charge or for nominal consideration esources received free of chare or for nominal consideration are reconised at their fair value when the transferee obtains control over them irrespective of whether restrictions or conditions are imposed over the use of the contributions unless received from another Health ervice or aenc as a conseuence of a restructurin of administrative arranements. n the latter case such transfer will be reconised at carrin amount. ontributions in the form of services are onl reconised when a fair value can be reliabl determined and the service would have been purchased if not received as a donation. Other Income ther income is reconised as revenue when received. ther income includes recoveries for salaries and waes and eternal services provided and donations and beuests. f donations are for a specific purpose the ma be appropriated to a surplus such as the specific restricted purpose surplus. Interest Revenue nterest revenue is reconised on a time proportionate basis that taes into account the effective ield of the financial asset which allocates interest over the relevant period. Dividend Revenue ividend revenue is reconised when the riht to receive pament is established. ividends represent the income arisin from West Gippsland Healthcare Group and its controlled entities investments in financial assets.

66 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to the inancial tatements West Gippsland Healthcare Group for the financial ear ended une

Note 3: The cost of delivering our services

his section provides an account of the epenses incurred b the hospital in deliverin services and outputs. n ection the funds that enable the provision of services were disclosed and in this note the cost associated with provision of services are recorded.

Structure . penses from ransactions . ther conomic lows . nalsis of epenses and revenue b internall manaed and restricted specific purpose funds . mploee benefits in the alance heet . uperannuation

West Gippsland Healthcare Group Annual Report 2019 67 Notes to the financial statements 30 June 2019

otes to the inancial tatements West Gippsland Healthcare Group for the financial ear ended une

Note 3.1: Expenses from Transactions

Total Total 2019 2018 $'000 $'000

alaries and Waes ncosts ee for ervice edical fficer penses Worcover remium Total Employee Expenses 90,094 81,660 ru upplies edical and urical upplies includin rostheses ianostic and adiolo upplies ther upplies and onsumables Total Supplies and Consumables 14,897 14,998 inance osts Total Finance Costs 81 7 uel iht ower and Water epairs and aintenance aintenance ontracts edical ndemnit nsurance ther dministrative penses penditure for apital urposes Total Other Operating Expenses 12,257 12,080 epreciation and mortisation refer ote . Total Other Non-Operating Expenses 7,097 6,495

Total Expenses from Transactions 124,426 115,240 Expenses are recognised as they are incurred and reported in the financial year to which they relate.

Employee Expenses mploee epenses include • Salaries and wages (including fringe benefits tax, leave entitlements, termination payments); • On-costs; • Agency expenses; • Fee for service medical officer expenses; • Work cover premium. Supplies and consumables

upplies and consumables upplies and services costs which are reconised as an epense in the reportin period in which the are incurred. he carrin amounts of an inventories held for distribution are epensed when distributed.

Finance costs inance costs include • interest on ban overdrafts and shortterm and lonterm borrowins nterest epense is reconised in the period in which it is incurred • amortisation of discounts or premiums relating to borrowings; • amortisation of ancillary costs incurred in connection with the arrangement of borrowings.

68 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to the Financial Statements West ippsland ealthcare roup for the financial year ended une

Note 3.1: Expenses from Transactions (cont'd)

Other Operating Expenses Other operating expenses generally represent the day-to-day running costs incurred in normal operations and include such things as • Fuel, light and power • Repairs and maintenance • Other administrative expenses • xpenditure for capital purposes (represents expenditure related to the purchase of assets that are below the capitalisation threshold). he epartment of ealth and uman Services also makes certain payments on behalf of West ippsland ealthcare roup. hese amounts have been brought to account as grants in determining the operating result for the year by recording them as revenue and also recording the related expense. Non-operating expenses Other non-operating expenses generally represent expenditure for outside the normal operations such as depreciation and amortisation, and assets and services provided free of charge or for nominal consideration.

West Gippsland Healthcare Group Annual Report 2019 69 Notes to the financial statements 30 June 2019

otes to the Financial tatements est ippsland ealthcare roup or the inancial ear ended une

Note 3.2: Other economic flows included in net result

2019 2018 $'000 $'000

Net gain/(loss) on sale of non‑financial assets mpairment o propert plant and euipment including intangile assets et gainloss on disposal o propert plant and euipment Total net gain/(loss) on non‑financial assets 21 (60) Net gain/(loss) on financial instruments at fair value ad dets written o unilaterall Total net gain/(loss) on financial instruments at fair value (132) (47) Other gains/(losses) from other economic flows et gainloss arising rom revaluation o long service liailit Total other gains/(losses) from other economic flows 210 3

Total other gains/(losses) from economic flows 99 (104)

Other economic lows are changes in the volume or value o an asset or liailit that do not result rom transactions Other gainslosses rom other economic lows include the gains or losses rom • the revaluation o the present value o the long service leave liailit due to changes in the ond interest rates and • reclassiied amounts relating to availaleorsale inancial instruments rom the reserves to net result due to a disposal or derecognition o the inancial instrument his does not include reclassiication etween equity accounts due to machinery of government changes or ‘other transfers’ of assets.

Net gain/ (loss) on non-financial assets et gain loss on noninancial assets and liailities includes realised and unrealised gains and losses as ollows • Revaluation gains losses o noninancial phsical assets Reer to ote ropert plant and euipment • Net gain/ (loss) on disposal of non-financial assets • Any gain or loss on the disposal of non-financial assets is recognised at the date of disposal.

Net gain/ (loss) on financial instruments at fair value

et gain loss on inancial instruments at air value includes • realised and unrealised gains and losses from revaluations of financial instruments at fair value; • impairment and reversal o impairment or inancial instruments at amortised cost reer to ote nvestments and other inancial assets and • disposals of financial assets and derecognition of financial liabilities.

Other gains/ (losses) from other economic flows Other gains losses include • the revaluation o the present value o the long service leave liailit due to changes in the ond rate movements, inlation rate movements and the impact o changes in proailit actors and • transer o amounts rom the reserves to accumulated surplus or net result due to disposal or derecognition or reclassiication Fair Value of Assets, Services Provided Free of Charge or for Nominal Consideration ontriutions o resources provided ree o charge or or nominal consideration are recognised at their air value when the transeree otains control over them

70 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019 Notes to the inancial tatements est ippsland ealthcare roup for the financial year ended une

Note 3.3: Analysis of Expenses and Revenue by Internally Managed and Restricted Specific Purpose Funds

Expense Revenue 2019 2018 2019 2018 $'000 $'000 $'000 $'000 Commercial Activities rivate ractice and ther atient Activities aundry afeteria roperty ther (include any activity not stated above) TOTAL 12,626 11,797 13,961 13,535

West Gippsland Healthcare Group Annual Report 2019 71 Notes to the inancial tatements Notes to the inancial tatements est ippsland ealthcare roup for the financial year ended une est ippsland ealthcare roup for the Notesfinancial to theyear inancial ended tatements une Notes to the financialest ippsland statements ealthcare roup for the financial year ended30 June une 2019 Note 3.4: Employee Benefits in the Balance Sheet Note 3.4: Employee Benefits in the Balance Sheet 2019 2018 2019 2018 $'000 $'000 $'0002019 $'0002018 $'000 $'000 CURRENT PROVISIONS CURRENT PROVISIONS i mployee enefits i CURRENTmployee enefits PROVISIONS Accrued Days Off i mployeeAccrued Days enefits Off ii -Accrued unconditional Days Off and epected to be settled holly ithin months ii - unconditional and epected to be settled holly ithin months - unconditional and epected to be settled holly ithin months ii Annual leave Annual leave ii - unconditional and epected to be settled holly ithin months ii Annual- unconditional leave and epected to be settled holly ithin months ii - unconditional and epected to be settled holly ithin monthsiii - unconditional and epected to be settled holly after months iii - unconditional and epected to be settled holly after months - unconditional and epected to be settled holly after months iii Long Service Leave Long Service Leave Long Service Leave ii - unconditional and epected to be settled holly ithin months ii - unconditional and epected to be settled holly ithin months - unconditional and epected to be settled holly ithin months ii iii - unconditional and epected to be settled holly after months iii - unconditional and epected to be settled holly after months iii - unconditional and epected to be settled holly after months 14,326 13,366 14,326 13,366 Provisions related to Employee Benefit On-Costs 14,326 13,366 Provisions related to Employee Benefit On-Costs ii nconditional and epected to be settled ithin months ii Provisionsnconditional related and epected to Employee to be settled Benefit ithin On-Costs months iii ii nconditional and epected to be settled afterithin months months iii nconditional and epected to be settled after months iii nconditional and epected to be settled after months 1,593 1,482 1,593 1,482 1,593 1,482 TOTAL CURRENT PROVISIONS 15,919 14,848 TOTAL CURRENT PROVISIONS 15,919 14,848 TOTAL CURRENT PROVISIONS 15,919 14,848 NON-CURRENT PROVISIONS NON-CURRENT PROVISIONS onditional ong ervice eave NON-CURRENTonditional ong PROVISIONService eave rovisions related to mployee enefit n-osts onditionalrovisions related ong ervice to mployee eave enefit n-osts TOTAL NON-CURRENT PROVISIONS 3,342 2,616 rovisionsTOTAL NON-CURRENT related to mployee PROVISIONS enefit n-osts 3,342 2,616 TOTAL NON-CURRENT PROVISIONS 3,342 2,616 TOTAL PROVISIONS 19,261 17,464 TOTAL PROVISIONS 19,261 17,464 TOTAL PROVISIONS 19,261 17,464 i i mployee benefits consist of amounts for accrued days off annual leave and long service leave accrued by employees not mployee benefits consist of amounts for accrued days off annual leave and long service leave accrued by employees not including on-costs. iincluding on-costs. ii mployee benefits consist of amounts for accrued days off annual leave and long service leave accrued by employees not includingii he amounts on-costs. disclosed are nominal amounts. iii he amounts disclosed are nominal amounts. iiiii he amounts disclosed are discounted to present values. hehe amountsamounts discloseddisclosed areare nominaldiscounted amounts. to present values. iii he amounts disclosed are discounted to present values. (a) Employee Benefits and Related On-Costs (a) Employee Benefits and Related On-Costs (a) Employee Benefits and Related On-Costs 2019 2018 2019 2018 Current Employee Benefits and Related On-Costs $'000 $'000 Current Employee Benefits and Related On-Costs $'0002019 $'0002018 nconditional long service leave entitlements Currentnconditional Employee long service Benefits leave and entitlements Related On-Costs $'000 $'000 Annual leave entitlements nconditionalAnnual leave entitlementslong service leave entitlements Accrued days off AnnualAccrued leave days entitlementsoff Non-Current Employee Benefits and Related On-Costs AccruedNon-Current days off Employee Benefits and Related On-Costs onditional long service leave entitlements Non-Currentonditional long Employee service leave Benefits entitlements and Related On-Costs onditionalTOTAL EMPLOYEE long service BENEFITS leave entitlements AND RELATED ON-COSTS 19,261 17,464 TOTAL EMPLOYEE BENEFITS AND RELATED ON-COSTS 19,261 17,464 TOTAL EMPLOYEE BENEFITS AND RELATED ON-COSTS 19,261 17,464

(b) Movement in On-Costs Provision (b) Movement in On-Costs Provision (b) Movement in On-Costs Provision 2019 2019 $'000 $'0002019 Balance at start of year 1,747 Balance at start of year $'000 1,747 Additional provisions recognised BalanceAdditional at provisions start of yearrecognised 1,747 ninding of discount and effect of changes in the discount rate Additionalninding provisionsof discount recognised and effect of changes in the discount rate eduction due to transfer out () nindingeduction dueof discount to transfer and out effect of changes in the discount rate () Balance at end of year 1,931 eductionBalance at due end to oftransfer year out 1,931 () Balance at end of year 1,931 72 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Notes to the inancial tatements est ippsland ealthcare roup for the financial year ended une

Note 3.4: Employee Benefits in the Balance Sheet (cont'd)

Employee Benefit Recognition rovision is made for benefits accruing to employees in respect of ages and salaries annual leave and long service leave for services rendered to the reporting date as an epense during the period the services are delivered

Provisions

rovisions are recognised hen est ippsland ealthcare roup has a present obligation the future sacrifice of economic benefits is probable and the amount of the provision can be measured reliably. he amount recognised as a liability is the best estimate of the consideration required to settle the present obligation at reporting date taing into account the riss and uncertainties surrounding the obligation.

Annual Leave and Accrued Days Off

iabilities for annual leave and accrued days off are recognised in the provision for employee benefits as current liabilities because est ippsland ealthcare roup does not have an unconditional right to defer settlements of these liabilities. epending on the epectation of the timing of settlement liabilities for annual leave and accrued days off are measured at Nominal value – if West Gippsland Healthcare Group expects to wholly settle within 12 months; or Present value – if West Gippsland Healthcare Group does not expect to wholly settle within 12 months.

Long Service Leave he liability for long service leave () is recognised in the provision for employee benefits. nconditional is disclosed in the notes to the financial statements as a current liability even here the est ippsland ealthcare roup does not epect to settle the liability ithin months because it ill not have the unconditional right to defer the settlement of the entitlement should an employee tae leave ithin months. An unconditional right arises after a qualifying period. he components of this current liability are measured at • Nominal value – if West Gippsland Healthcare Group expects to wholly settle within 12 months; or • Present value – if West Gippsland Healthcare Group does not expect to wholly settle within 12 months. onditional is disclosed as a non-current liability. Any gain or loss folloed revaluation of the present value of non-current liability is recognised as a transaction ecept to the etent that a gain or loss arises due to changes in estimations e.g. bond rate movements inflation rate movements and changes in probability factors hich are then recognised as other economic flos Termination Benefits ermination benefits are payable hen employment is terminated before the normal retirement date or hen an employee decides to accept an offer of benefits in echange for the termination of employment.

On-Costs Related to Employee Benefits rovision for on-costs such as orers compensation and superannuation are recognised separately from provisions for employee benefits.

West Gippsland Healthcare Group Annual Report 2019 73 Notes to the financial statements 30 June 2019

Notes to the inancial tatements West Gippsland Healthcare Group for the financial year ended une 21

Note 3.5: Superannuation

Paid Contribution for the Contribution Outstanding Year at Year End

2019 2018 2019 2018 $'000 $'000 $'000 $'000 Defined Benefit Plans:i irst tate uper 11 12 1 Defined Contribution Plans: irst tate uper 1 1 1 ther 21 1 1 1 Total 6,223 5,479 330 486

i he asis for determinin the level of contriutions is determined y the various actuaries of the defined enefit superannuation plans.

mployees of West Gippsland Healthcare Group are entitled to receive superannuation enefits and it contriutes to oth defined enefit an defined contriution plans. he defined enefit plan provides enefits ased on years of service and final averae salary. Defined Benefit Superannuation Plans he amount chared to the omprehensive peratin tatement in respect of defined enefit superannuation plans represents the contriutions made y West Gippsland Healthcare Group to the superannuation plans in respect of the services of current West Gippsland Healthcare Group’s staff durin the reportin period. uperannuation contriutions are made to the plans ased on the relevant rules of each plan and are ased upon actuarial advice. West Gippsland Healthcare Group does not reconise any unfunded defined enefit liaility in respect of the plans ecause the health service has no leal or constructive oliation to pay future enefits relatin to its employees; its only oliation is to pay superannuation contriutions as they fall due. he epartment of reasury and inance discloses the State’s defined benefits liabilities in its disclosure for administered items. However superannuation contriutions paid or payale for the reportin period are included as part of employee enefits in the omprehensive peratin tatement of West Gippsland Healthcare Group. he name details and amounts that have een expensed in relation to the maor employee superannuation funds and contriutions made y West Gippsland Healthcare Group are disclosed aove. Defined Contribution Superannuation Plans n relation to defined contriution i.e. accumulation superannuation plans the associated expense is simply the employer contriutions that are paid or payale in respect of employees who are memers of these plans durin the reportin period. ontriutions to defined contriution superannuation plans are expensed when incurred

74 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to the inancial Statements est Gippsland ealthcare Group for the financial ear ended une

Note 4: Key Assets to Support Service Delivery

est Gippsland ealthcare Group controls infrastructure and other inestments that are utilised in fulfillin its obecties and conductin its actiities. he represent the e resources that hae been entrusted to est Gippsland ealthcare Group to be utilised for delier of those outputs.

Structure . nestments and other financial assets . ropert plant euipment . epreciation and amortisation

West Gippsland Healthcare Group Annual Report 2019 75 Notes to the financial statements 30 June 2019

otes to the inancial Statements est Gippsland ealthcare Group for the financial ear ended une

Note 4.1: Investments and Other Financial Assets

Specific Purpose Fund 2019 2018 $'000 $'000 CURRENT Loans and Receivables entral anin Sstem erm eposits onths ther Salar acain TOTAL CURRENT 11,262 9,154 TOTAL INVESTMENTS AND OTHER FINANCIAL ASSETS 11,262 9,154

Represented by: ealth Serice nestments ccommodation onds Salar acain TOTAL INVESTMENTS AND OTHER FINANCIAL ASSETS 11,262 9,154

Investment Recognition nestments are reconised and dereconised on trade date here purchase or sale of an inestment is under a contract hose terms reuire delier of the inestment ithin the timeframe established b the maret concerned and are initiall measured at fair alue net of transaction costs. nestments are classified as loans and receiables or aailableforsale financial assets. he est Gippsland ealthcare Group classifies its other financial assets beteen current and noncurrent assets based on the Board’s intention at balance date with respect to the timing of disposal of each asset. West Gippsland ealthcare Group assesses at each balance sheet date hether a financial asset or roup of financial assets is impaired. est Gippsland ealthcare Groups inestments must compl ith Standin irection .. reasur anaement includin entral anin Sstem. est Gippsland ealthcare Groups controlled entities manae their inestments in accordance ith their on inestment polic as approed b their oard and their inestments are consolidated into est Gippsland ealthcare Group for reportin purposes as it is the ultimate beneficiar of est Gippsland ealthcare Group oundation. ll financial assets ecept for those measured at fair alue throuh the omprehensie peratin Statement are subect to annual reie for impairment.

Derecognition of Financial Assets

financial asset or here applicable a part of a financial asset or part of a roup of similar financial assets is dereconised hen • The rights to receive cash flows from the asset have expired; or • est Gippsland ealthcare Group retains the riht to receie cash flos from the asset but has assumed an obligation to pay them in full without material delay to a third party under a ‘pass through’ arrangement; or • West Gippsland Healthcare Group has transferred its rights to receive cash flows from the asset and either: • Has transferred substantially all the risks and rewards of the asset; or • as neither transferred nor retained substantiall all the riss and reards of the asset but has transferred control of the asset. here est Gippsland ealthcare Group has neither transferred nor retained substantiall all the riss and reards or transferred control the asset is reconised to the etent of est Gippsland ealthcare Group’s continuin inolement in the asset.

76 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to the inancial tatements West Gippsland Healthcare Group for the financial year ended une

Note 4.1: Investments and Other Financial Assets (cont'd)

Impairment of Financial Assets

t the end of each reporting period West Gippsland Healthcare Group assesses whether there is obective evidence that a financial asset or group of financial assets is impaired. ll financial instrument assets except those measured at fair value through the omprehensive ncome tatement are subect to annual review for impairment. Where the fair value of an investment in an euity instrument at balance date has reduced by percent or more than its cost price or where its fair value has been less than its cost price for a period of or more months the financial asset is treated as impaired. n order to determine an appropriate fair value as at une for its portfolio of financial assets West Gippsland Healthcare Group and its controlled entities used the market value of investments held provided by the portfolio managers. The above valuation process was used to uantify the level of impairment if any on the portfolio of financial assets as at year end.

West Gippsland Healthcare Group Annual Report 2019 77 Notes to the financial statementsotes to the inancial30 tatements June 2019 West Gippsland Healthcare Group for the financial year ended une Note 4.2: Property, Plant and Equipment

Initial Recognition tems of property plant and euipment are measured initially at cost and subseuently revalued at fair value less accumulated depreciation and impairment loss. Where an asset is acuired for no or nominal cost the cost is its fair value at the date of acuisition. ssets transferred as part of a mergermachinery of government change are transferred at their carrying amounts. The cost of a leasehold improvement is capitalised as an asset and depreciated over the shorter of the remaining term of the lease or the estimated useful life of the improvements. The initial cost for nonfinancial physical assets under finance lease refer to ote . is measured at amounts eual to the fair value of the leased asset or if lower the present value of the minimum lease payments each determined at the inception of the lease. Theoretical opportunities that may be available in relation to the assets are not taken into account until it is virtually certain that any restrictions will no longer apply. Therefore unless otherwise disclosed the current use of these nonfinancial physical assets will be their highest and best uses. and and buildings are recognised initially at cost and subseuently measured at fair value less accumulated depreciation and accumulated impairment loss. Revaluations of Non-Current Physical Assets

oncurrent physical assets are measured at fair value and are revalued in accordance with H on urrent hysical ssets. This revaluation process normally occurs every five years based upon the assets Government urpose lassification but may occur more freuently if fair value assessments indicate material changes in values. ndependent valuers are used to conduct these scheduled revaluations and any interim revaluations are determined in accordance with the reuirements of the s. evaluation increments or decrements arise from differences between an asset’s carrying value and fair value. evaluation increments are recognised in ‘Other omprehensive Income’ and are credited directly to the asset revaluation surplus except that to the extent that an increment reverses a revaluation decrement in respect of that same class of asset previously recognised as an expense in net result the increment is recognised as income in the net result. evaluation decrements are recognised in ‘Other omprehensive Income’ to the extent that a credit balance exists in the asset revaluation surplus in respect of the same class of property plant and euipment. evaluation increases and revaluation decreases relating to individual assets within an asset class are offset against one another within that class but are not offset in respect of assets in different classes. evaluation surplus is not transferred to accumulated funds on derecognition of the relevant asset except where an asset is transferred via contributed capital. n accordance with G West Gippsland Healthcare Groups noncurrent physical assets were assessed to determine whether revaluation of the noncurrent physical assets was reuired.

Fair value measurement air value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. or the purpose of fair value disclosures West Gippsland Healthcare Group has determined classes of assets on the basis of the nature characteristics and risks of the asset and the level of the fair value hierarchy as explained above. n addition West Gippsland Healthcare Group determines whether transfers have occurred between levels in the hierarchy by reassessing categorisation based on the lowest level input that is significant to the fair value measurement as a whole at the end of each reporting period. The Valuer-General Victoria (VGV) is West Gippsland Healthcare Group’s independent valuation agency. The estimates and underlying assumptions are reviewed on an ongoing basis. Valuation hierarchy n determining fair values a number of inputs are used. To increase consistency and comparability in the financial statements these inputs are categorised into three levels also known as the fair value hierarchy. The levels are as follows: • Level 1 – quoted (unadjusted) market prices in active markets for identical assets or liabilities; • evel – valuation techniues for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and • evel – valuation techniues for which the lowest level input that is significant to the fair value measurement is unobservable.

78 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to the inancial tatements West Gippsland Healthcare Group for the financial year ended une 1 Note 4.2: Property, Plant and Equipment

Identifying unobservable inputs (level 3) fair value measurements

Level fair value inputs are unobservable valuation inputs for an asset or liability. These inputs require significant judgement and assumptions in deriving fair value for both financial and non-financial assets. nobservable inputs are used to measure fair value to the etent that relevant observable inputs are not available thereby allowing for situations in which there is little if any market activity for the asset or liability at the measurement date. However the fair value measurement objective remains the same i.e. an eit price at the measurement date from the perspective of a market participant that holds the asset or owes the liability. Therefore unobservable inputs shall reflect the assumptions that market participants would use when pricing the asset or liability including assumptions about risk. Consideration of highest and best use (HBU) for non-financial physical assets udgements about highest and best use must take into account the characteristics of the assets concerned including restrictions on the use and disposal of assets arising from the asset’s physical nature and any applicable legislativecontractual arrangements. In accordance with paragraph 1. West Gippsland Healthcare Group has assumed the current use of a non-financial physical asset is its H unless market or other factors suggest that a different use by market participants would maimise the value of the asset. Non-Specialised Land, Non-Specialised Buildings and Cultural Assets on-specialised land non-specialised buildings and cultural assets are valued using the market approach. nder this valuation method the assets are compared to recent comparable sales or sales of comparable assets which are considered to have nominal or no added improvement value. or non-specialised land and non-specialised buildings an independent valuation was performed by the Valuer-General Victoria to determine the fair value using the market approach. Valuation of the assets was determined by analysing comparable sales and allowing for share sie topography location and other relevant factors specific to the asset being valued. n appropriate rate per square metre has been applied to the subject asset. The effective date of the valuation is une 1. Specialised Land and Specialised Buildings

pecialised land includes rown Land which is measured at fair value with regard to the property’s highest and best use after due consideration is made for any legal or physical restrictions imposed on the asset public announcements or commitments made in relation to the intended use of the asset. Theoretical opportunities that may be available in relation to the assets are not taken into account until it is virtually certain that any restrictions will no longer apply. Therefore unless otherwise disclosed the current use of these non-financial physical assets will be their highest and best use. uring the reporting period West Gippsland Healthcare Group held rown Land. The nature of this asset means that there are certain limitations and restrictions imposed on its use andor disposal that may impact their fair value. The market approach is also used for specialised land and specialised buildings although it is adjusted for the community service obligation (O) to reflect the specialised nature of the assets being valued. pecialised assets contain significant unobservable adjustments; therefore these assets are classified as Level under the market based direct comparison approach. The O adjustment is a reflection of the valuer’s assessment of the impact of restrictions associated with an asset to the etent that is also equally applicable to market participants. This approach is in light of the highest and best use consideration required for fair value measurement and takes into account the use of the asset that is physically possible legally permissible and financially feasible. s adjustments of O are considered as significant unobservable inputs specialised land would be classified as Level assets. or West Gippsland Healthcare Group the depreciated replacement cost method is used for the majority of specialised buildings adjusting for the associated depreciation. s depreciation adjustments are considered as significant and unobservable inputs in nature specialised buildings are classified as Level for fair value measurements. n independent valuation of West Gippsland Healthcare Group’s specialised land and specialised buildings was performed by the Valuer-General Victoria. The valuation was performed using the market approach adjusted for O. The effective date of the valuation is une 1.

West Gippsland Healthcare Group Annual Report 2019 79 Notes to the financial statements 30 June 2019

otes to te aal tateets est Gppsla ealtare Group or te aal year ee ue Note 4.2: Property, Plant and Equipment

Vehicles

e est Gppsla ealtare Group aures e veles a at tes sposes o te eore opleto o ter eoo le e proess o austo use a sposal te aret s aae y te ealt erve o set relevat epreato rates ur use to relet te osupto o te veles s a result te ar value o veles oes ot er aterally ro te arry aout epreate ost

Plant and Equipment lat a eupet lu eal eupet oputers a ouato eupet a urture a tts are el at arry aout epreate ost e plat a eupet s spealse use su tat t s rarely sol oter ta as part o a o oer te epreate replaeet ost s use to estate te ar value less tere s aret evee tat urret replaeet osts are satly eret ro te oral austo ost t s osere ulely tat epreate replaeet ost ll e aterally eret ro te est arry aout ere ere o aes valuato teues trouout te pero to ue or all assets easure at ar value te urret use s osere te est a est use

80 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te aal tateets est Gppsla ealtare Group or te aal year ee ue Note 4.2: Property, Plant and Equipment

(a) Gross carrying amount and accumulated depreciation

2019 2018 $'000 $'000 Land reeol Total Land 10,443 11,551 Buildings

uls at ar alue ess uulate epreato Total Buildings 48,500 48,363

Assets Under Construction ssets er ostruto Total Assets Under Construction 8,612 1,143

Plant and Equipment lat a upet at ar alue ess uulate epreato Total Plant and Equipment 11,153 11,293

Motor Vehicles

otor eles at ar alue ess uulate epreato Total Motor Vehicles 1,171 849

Medical Equipment

eal upet at ar alue ess uulate epreato Total Medical Equipment 3,945 3,942

Computers and Communication Equipment

oputers a ouato upet at ar alue ess uulate epreato Total Computers and Communication Equipment 95 84

Furniture and Fittings urture a tts at ar alue ess uulate epreato Total Furniture and Fittings 232 231

GHA rtte o alue Total GHA 11 28

TOTAL PROPERTY, PLANT AND EQUIPMENT 84,161 77,484

West Gippsland Healthcare Group Annual Report 2019 81 Notes to the financial statements 30 June 2019

o or te e

ue o o

84,161 75,182 77,484 value

Total $'000 etee es

s

value ar rtte

- -

ar te

294

revaluato o tora assets ter eae valuato $'000 Assets Leased

e te Geeral o

aaeral 427

vual

assesset oul

a etere 8,612 1,143

ate to aluer to otes to teotes to aal tateets $'000 te aual

assets Construction

Assets Under approve a

eetve opare uls

232 247 231

ae e a ere or $'000 erves Fittings Fittings a oute Furniture &

la values

ua

95 71 84

aouts reasury assessets lease a o te ee $'000 Comm a aaeet Equipment Equipment to

Computers & Computers

e ealt

o

oe

epeet Groups

epartet est Gppsla ealtare te aal or Group ue year ee 3,945 4,106 3,942

o $'000 reeree Medical Medical

te

Group Equipment Equipment y

ase

epartet ro

ealtare 877 849

1,042

e as $'000 Motor Motor revaluato Vehicles

ealtare otae

etere

Gppsla

values valuato

as 11,164 11,610 11,322

$'000 ar aaeral Plant & Plant est Gppsla

a e Equipment Equipment

y ter

aaeet est

o 48,500 47,409 48,363 taars

$'000 ts ue

Buildings

all auste trasato ae

te ee

altate

aluato let 10,443 revalue 10,270 11,551

ee Land $'000 o to

ave

year ars etere te a ustrala to uls uls uertoo to a lease partes ue la tora a oors te ll at t o as uls value values a aluerGeeral ar oplae Note 4.2: Property, Plant and Plant 4.2: Equipment Property, Note (Cont'd) (b) Reconciliations(b) of the of asset amounts of each carrying class Carried at Valuation Buildings and Land Assets Leased and Balance at 302019 at June Balance e la e Balance at 1 July 2017 1 July at Balance Balance at 1 July 2018 1 July at Balance teaal ue year ee oo valuato la asset lass o a or uls laor asset l a lass te revalue aso et to aopte approa GG t uls oleeale sposals paret losses reosereverse reosereverse losses paret evaluato reetsereets evaluato epreato reer ote ote reer epreato et rasers etee lasses rasersetee et sposals tos etresult epreato reer ote ote reer epreato et rasers etee lasses rasersetee et tos evaluato reetsereets evaluato

82 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statementsotes to te aal30 tateetsJune 2019 est Gppsla ealtare Group or te aal year ee ue

Note 4.2: Property, Plant and Equipment (Cont'd) (c) Fair value measurement hierarchy for assets

Fair value measurement at end of reporting period using: Carrying Amount Level 1 i Level 2 i Level 3 i Balance at 30 June 2019 $'000 $'000 $'000 $'000 Land at Fair Value opealse a pealse a otal a at ar alue 10,443 - 6,778 3,665

Buildings at Fair Value pealse uls opealse uls otal ul at ar alue 48,500 - 3,829 44,671

lat a upet at ar alue

otor eles at ar alue

eal upet at ar alue

oputers a ouato upet at ar alue

urture a tts at ar alue

ssets er ostruto

Leased Assets at Fair Value ter ease ssets at ar alue otal ease ssets at ar alue 294 - - 294 Total Property, Plant and Equipment 84,161 - 19,219 64,942

Fair value measurement at end of reporting period using: Carrying Amount Level 1 i Level 2 i Level 3 i Balance at 30 June 2018 $'000 $'000 $'000 $'000 Land at Fair Value opealse a pealse a otal a at ar alue

Buildings at Fair Value pealse uls otal ul at ar alue

lat a upet at ar alue

otor eles at ar alue

eal upet at ar alue

oputers a ouato upet at ar alue

urture a tts at ar alue

ssets er ostruto

Leased Assets at Fair Value etter ease upet ssets at ar alue otal ease ssets at ar alue Total Property, Plant and Equipment 77,484 - 1,143 76,341 lasse aorae t te ar value erary

ere ave ee o trasers etee levels ur te pero te pror year tere s a traser etee ospealse la a spealse la to relet te orret ar value as per te aaeral revaluato

West Gippsland Healthcare Group Annual Report 2019 83 Notes to the financial statements 30 June 2019

- - -

294

$'000 $'000 Assets Assets Leased Leased Leased

231 232 247 231

$'000 $'000 Fittings Fittings

Furniture & Furniture &

84 95 71 84

otes to te aal to te otes tateets $'000 $'000 & Comm & Comm & Comm

Equipment Equipment Computers Computers

3,942 3,945 4,106 3,942 $'000 $'000 Medical Medical

Equipment Equipment

849 877 849

1,042 $'000 $'000 Motor Motor Vehicles Vehicles

estGppsla ealtare or aalGroup te ue ee year 11,322 11,164 11,610 11,322

$'000 $'000 Plant & Plant & Plant and and Plant

Equipment Equipment

48,363 44,671 47,409 48,363

$'000 $'000 Buildings Buildings

3,665

11,551 10,270 11,551

Land Land $'000 $'000

i lasse aorae t te ar value erary reer ote Note 4.2: Property, Plant and Equipment 4.2: and (Cont'd) Property, Plant Note (d) Reconciliation of Level 3 Fair Value 3 Fair ReconciliationLevel (d) of 2018 1 July at Balance 2019 30 June at Balance 2017 1 July at Balance 2018 30 June at Balance tossposals raserset etee lasses Gasosses reose esult et epreato ortsato a reosetes opreesveter oe evaluato tossposals raserset etee lasses Gasosses reose esult et epreato ortsato a paret oss reosetes opreesveter oe evaluato

84 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te aal tateets otes to teotes aal to te tateetsaal tateets est Gppsla ealtare Group or te aal year ee ue est Gppslaest Gppslaealtare ealtare Group or Groupte aal or te year aal ee year eeue ue Note 4.2 (e): Property, Plant and Equipment (Fair value determination) Note 4.2 (e):Note Property, 4.2 (e): Plant Property, and EquipmentPlant and Equipment (Fair value (Fairdetermination) value determination)

Likely valuation Significant inputs (Level 3 Asset class Likely valuationLikely valuation Significant Significant inputs (Level inputs 3 (Level 3 Asset classAsset class approach only)(c) approachapproach only)(c) only)(c) opealse a aret approa a opealseopealse a a aret approaaret approaa a outy erve pealse a ro reeol aret approaoutyouty erve erve pealsepealse a ro a reeolro reeol aret approaaret approa latos ustets latoslatos ustets ustets opealse uls aret approa a opealseopealse uls uls aret approaaret approaa a epreate replaeet ost per suare etre pealse uls epreateepreate replaeet replaeet ost per suareost per etre suare etre pealsepealse uls uls ost approa ost approaost approa seul le seul le seul le epreate replaeet eles epreateepreate replaeet replaeet ost per ut eles eles ost approa ost per ut ost per ut ost approaost approa seul le seul le seul le epreate replaeet ost per ut lat a upet epreateepreate replaeet replaeet ost per utost per ut lat a latupet a upet ost approa seul le ost approaost approa seul le seul le epreate replaeet ost per ut eal upet epreateepreate replaeet replaeet ost per ut ost per ut eal upeteal upet ost approa seul le ost approaost approa seul le seul le

West Gippsland Healthcare Group Annual Report 2019 85 Notes to the financial statements 30 June 2019

otes to te aal tateets est Gppsla ealtare Group or te aal year ee ue

Note 4.2 (f): Property, Plant and Equipment Revaluation Surplus

2019 2018 $'000 $'000 Property, Plant and Equipment Revaluation Surplus alae at te e o te report pero evaluato reet a reer ote uls Balance at the end of the reporting period* 56,710 53,651

* Represented by: a uls 56,710 53,651

86 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te aal tateets est Gppsla ealtare Group or te aal year ee ue

Note 4.3: Depreciation

2019 2018 $'000 $'000 Depreciation uls lat a upet otor eles eal upet oputers a ouato upet urture a tts ease ssets TOTAL DEPRECIATION 7,097 6,495

Depreciation ll rastruture assets uls plat a eupet a oter oaal pysal assets elu tes uer operat leases assets el or sale la a vestet propertes tat ave te useul lves are epreate epreato s eerally alulate o a stratle ass at rates tat alloate te asset’s value less ay estate resual value over ts estate useul le e ollo tale ates te epete useul lves o ourret assets o te epreato ares are ase (a) useful life of non-current assets

2019 2018 Buildings - Structure Shell Building Fabric 24 to 40 Years 40 to 60 Years - Site Engineering Services and Central Plant 16 to 40 Years 20 to 30 Years Central Plant - Fit Out 10 to 40 Years 20 to 30 Years - Trunk Reticulated Building System 12 to 40 Years 30 to 40 Years Plant and Equipment 3 to 40 Years 3 to 25 Years Medical Equipment 10 to 20 Years 10 to 20 Years Computers and Communication 3 to 10 Years 3 to 10 Years Furniture and Fitting 4 to 25 Years 4 to 25 Years Motor Vehicles 4 to 10 Years 4 to 10 Years

s part o te ul valuato ul values are separate to opoets a ea opoet assesse or ts useul le s represete aove

West Gippsland Healthcare Group Annual Report 2019 87 Notes to the financial statements 30 June 2019

tes t te aa tateets est sa eatae te aa ea ee e

Note 5: Other assets and liabilities

s set sets t tse assets a ates tat ase est sa eatae s eats Structure eeaes aaes te ates

88 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

tes t te aa tateets est sa eatae te aa ea ee e

Note 5.1: Receivables

2019 2018 $'000 $'000 CURRENT Contractual te sta ets ae ets atet ees e estet e e eee

Less Allowance for Doubtful Debts ae ets atet ees 2,112 2,185 Statutory e eee eatet a ees eeae 357 435 TOTAL CURRENT RECEIVABLES 2,469 2,620

Statutory ee eae eatet eat a a ees 1,106 548 TOTAL NON-CURRENT RECEIVABLES 1,106 548

TOTAL RECEIVABLES 3,575 3,168

(a) Movement in the Allowance for Doubtful Debts 2019 2018 $'000 $'000

aae at e ea eesa aae tte te ea as etae ease aae ese te et est Balance at end of year 90 47

West Gippsland Healthcare Group Annual Report 2019 89 Notes to the financial statements 30 June 2019

tes t te aa tateets est sa eatae te aa ea ee e

Note 5.1: Receivables (cont'd) Receivables recognition

eeaes sst • tata eeaes ssts ets eat t s a sees a ae estet e ese eeaes ae asse as aa stets a atese as ‘financial assets at atse costs’. e ae ta ese at a ae s a et atttae tasat sts est sa eatae s te tata eeaes t te ete t et te tata as s a teee sseet ease at atse st s te eete teest et ess a aet • tatt eeaes eat es ats te ta eet a s a ees a t ta ets eeae tatt eeaes t ase tats a ae ese a ease sa t tata eeaes eet aet t ae t asse as aa stets sse ses est sa eatae aes ta easeet te statt eeaes a as a est statt eeaes ae ta ese at a ae s a et atttae tasat st

ae ets ae ae at a ats e a ae e setteet t as te ate et

assess aet statt tata aa assets ae t aa stets essa eet s ae assess ateat s estates aeaes a te tata ets aae t aet ssets

est sa eatae s t ese t a sat et s ese t a se teat a teates a sa aatests ae eeaes sst a ae e stes as eaa aeas ase sta at at ste eat ates aaeet se te et at tae eeaes tat ae t ast e ae t e Impairment losses of contractual receivables ee t te tata eeaes at atse sts est sa eatae Group’s tata aet sses

90 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

ots to t inancial tatnts st Gippslan altcar Group for t financial ar n un

Note 5.2: Payables 2019 2018 $'000 $'000 CURRENT Contractual ra ritors ra ritors G ccru alaris an as ccru pnss ccru pnss G tr tr G 6,571 6,141 Statutory

G aal partnt of alt an uan rics 2,214 1,200 TOTAL CURRENT PAYABLES 8,785 7,341

TOTAL PAYABLES 8,785 7,341

Payables Recognition aals consist of

• contractual paals classifi as financial instrunts an asur at aortis cost. ccounts paal an salaris an as paal rprsnt liailitis for oos an srics proi to t st Gippslan altcar Group prior to t n of t financial ar tat ar unpai an • statutor paals tat ar rconis an asur siilarl to contractual paals ut ar not classifi as financial instrunts an not inclu in t cator of financial liailitis at aortis cost caus t o not aris fro contracts. noral crit trs for accounts paal ar usuall tt as. Maturity analysis of payables las rfr to ot . for t ain analsis of paals.

West Gippsland Healthcare Group Annual Report 2019 91 Notes to the financial statements 30 June 2019

Note 5.3: Other liabilities

2019 2018 $'000 $'000 CURRENT Total Current 9,771 7,659

Total Other Liabilities 9,771 7,659

* Total Monies Held in Trust Represented by the following assets: TOTAL 9,606 7,654

92 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Note 6: How we finance our operations

Structure

West Gippsland Healthcare Group Annual Report 2019 93 30 June 2019 Notes to the financial statements

Note 6.1: Borrowings 2019 2018 $'000 $'000

CURRENT Total Current Borrowings 683 629

NON CURRENT Total Non Current Borrowings 1,702 2,131

Total Borrowings 2,385 2,760

(a) Maturity analysis of borrowings

(b) Defaults and breaches

(c) Finance Lease Liabilities

Minimum future lease Present value of minimum payments future lease payments 2019 2018 2019 2018 $'000 $'000 $'000 $'000

Finance Leases TOTAL 295 - 295 -

TOTAL - - 295 -

Borrowings Recognition

94 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Note 6.1: Borrowings (cont'd)

Finance Leases

Entity as lessee

Borrowings ‘financial loss’, at ‘amortised cost’.

using the effective interest method. Non-interest bearing borrowings are measured at ‘fair value through profit or loss’.

West Gippsland Healthcare Group Annual Report 2019 95 Notes to the financial statements 30 June 2019

Notes to the inancial tatements est ippsland ealthcare roup for the financial ear ended une

Note 6.2: Cash and Cash Equivalents

2019 2018 $'000 $'000

ash on and ash at an , eposits at all - , , , TOTAL CASH AND CASH EQUIVALENTS 9,631 16,994

Represented by: ash as per ash low tatement , ,

TOTAL CASH AND CASH EQUIVALENTS 9,631 16,994

ash and cash euivalents recognised on the alance heet comprise cash on hand and in bans, deposits at call and highl liuid investments with an original maturit date of three months or less, which are held for the purpose of meeting short term cash commitments rather than for investment purposes, which are readil convertible to nown amounts of cash and are subect to insignificant ris of changes in value. or cash flow statement presentation purposes, cash and cash euivalents include ban overdrafts, which are included as liabilities on the balance sheet. he cash flow statement includes monies held in trust.

96 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

Notes to the inancial tatements est ippsland ealthcare roup for the financial ear ended une

Note 6.3 : Commitments for expenditure

2019 2018 $'000 $'000

Capital Expenditure Commitments ess than ear , Total Capital Expenditure Commitments 1,462 327

Operating Expenditure Commitments ess than ear onger than ear but not longer than ears ears or more Total Operating Expenditure Commitments 304 265

Total Commitments for Expenditure (inclusive of GST) 1,766 592

ess recoverable from the ustralian a ffice

TOTAL COMMITMENTS FOR EXPENDITURE (exclusive of GST) 1,605 538

uture finance lease paments are recognised on the balance sheet, refer to Note . orrowings.

Commitments

ommitments for future ependiture include operating and capital commitments arising from contracts. hese commitments are disclosed at their nominal value and are inclusive of the paable. n addition, where it is considered appropriate and provides additional relevant information to users, the net present values of significant proects are stated. hese future ependitures cease to be disclosed as commitments once the related liabilities are recognised on the alance heet.

est ippsland ealthcare roup has entered into commercial leases on certain medical euipment, computer euipment and propert where it is not in the interest of est ippsland ealthcare roup to purchase these assets. hese leases have an average life of between and ears with renewal terms included in the contracts. enewals are at the option of est ippsland ealthcare roup. here are no restrictions placed upon the lessee b entering into these leases.

West Gippsland Healthcare Group Annual Report 2019 97 Notes to the financial statements 30 June 2019

Notes to the inancial tatements est ippsland ealthcare roup for the financial ear ended une

Note 6.4: Non-cash financing and investing activities

2019 2018 $'000 $'000 cuisition of plant and euipment b means of inance eases - Total Non-Cash Financing and Investing Activities 318 -

98 West Gippsland Healthcare Group Annual Report 2019

6.4 Non-cash financing & inv Notes to the financial statements 30 June 2019

Notes to the inancial tatements est ippsland ealthcare roup for the financial ear ended une

Note 7: Risks, contingencies and valuation uncertainties

est ippsland ealthcare roup is eposed to ris from its activities and outside factors. n addition, it is often necessar to mae udgements and estimates associated with recognition and measurement of items in the financial statements. his section sets out financial instrument specific information, including eposures to financial riss as well as those items that are contingent in nature or reuire a higher level of udgement to be applied, which for the health service is related mainl to fair value determination.

Structure . inancial nstruments . ontingent ssets and ontingent iabilities

West Gippsland Healthcare Group Annual Report 2019 99 Notes to the financial statements Notes to the30 inancial June tatements 2019 est ippsland ealthcare roup for the financial ear ended une Note 7.1 (a): Financial Instruments

inancial instruments arise out of contractual agreements that give rise to a financial asset of one entit and a financial liabilit or euit instrument of another entit. ue to the nature of est ippsland ealthcare roups activities, certain financial assets and financial liabilities arise under statute rather than a contract. uch financial assets and financial liabilities do not meet the definition of financial instruments in inancial nstruments resentation. (a) Categorisation of financial instruments Financial Assets at Financial Liabilities at Amortised Cost Amortised Cost Total

2019 $'000 $'000 $'000 Contractual Financial Assets ash and ash uivalents , - , Receivables - rade ebtors , - , - ther eceivables - Investments and Other Financial Assets - erm eposits , - , - ccommodation bonds , , - ther Total Financial Assets i 23,005 - 23,005

Financial Liabilities aables - , , orrowings - , , ther inancial iabilities - - ccommodation bonds , , - ther - Total Financial Liabilities i - 18,727 18,727

Notes to the inancial tatements est ippsland ealthcare roup for the financial ear ended une

Note 7.1 (a): Financial Instruments

Contractual Financial Contractual Financial Assets - Loans and Liabilities at Receivables and Cash Amortised Cost Total

2018 $'000 $'000 $'000 Contractual Financial Assets ash and ash uivalents , - , Receivables - - rade ebtors , - , - ther eceivables - Investments and Other Financial Assets - - erm eposit , - , Total Financial Assets i 28,348 - 28,348

Financial Liabilities aables - , , orrowings - , , ther inancial iabilities - ccommodation bonds - , , - ther - Total Financial Liabilities i - 15,006 15,006 i he carring amount ecludes statutor receivables i.e. receivable and receivable and statutor paables i.e. evenue in dvance and paable. inancial instruments arise out of contractual agreements that give rise to a financial asset of one entit and a financial liabilit or euit instrument of another entit. ue to the nature of est ippsland ealthcare roups activities, certain financial assets and financial liabilities arise under statute rather than a contract. uch financial assets and financial liabilities do not meet the definition of financial instruments in inancial nstruments resentation. ategories of financial assets under Financial assets at amortised cost inancial assets are measured at amortised costs if both of the following criteria are met and the assets are not designated as fair value through net result • the assets are held by West Gippsland Healthcare Group to collect the contractual cash flows, and • the assets’ contractual terms give rise to cash flows that are solely payments of principal and interests. hese assets are initiall recognised at fair value plus an directl attributable transaction costs and subseuentl measured at amortised cost using the effective interest method less an impairment. he epartment recognises the following assets in this categor • cash and deposits; • receivables (excluding statutory receivables); and • term deposits 100 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to the inancial tatements West Gippsland Healthcare Group for the financial year ended une

Note 7.1 (a): Financial Instruments (cont'd)

Financial assets at fair value through net result

uity instruments that are held for trading as well as derivative instruments are classified as fair value through net result. ther financial assets are reuired to be measured at fair value through net result unless they are measured at amortised cost or fair value through other comprehensive income as explained above. However, as an exception to those rules above, West Gippsland Healthcare Group may, at initial recognition, irrevocably designate financial assets as measured at fair value through net result if doing so eliminates or significantly reduces a measurement or recognition inconsistency (‘accounting mismatch’) that would otherwise arise from measuring assets or liabilities or recognising the gains and losses on them on different bases. West Gippsland Healthcare Group recognises listed euity securities as mandatorily measured at fair value through net result and designated all of its managed investment schemes as well as certain year government bonds as fair value through net result.

Categories of Non-Derivative Financial Instruments

Loans and Receivables oans and receivables are financial instrument assets with fixed and determinable payments that are not uoted on an active maret. hese assets are initially recognised at fair value plus any directly attributable transaction costs. ubseuent to initial measurement, loans and receivables are measured at amortised cost using the effective interest method, less any impairment.

oans and receivables category includes cash and deposits, term deposits with maturity greater than three months, trade receivable and other receivables, but not statutory receivables.

Financial Liabilities at Amortised Cost inancial instrument liabilities are initially recognised on the date they are originated. hey are initially measured at fair value plus any directly attributable transaction costs. ubseuent to initial recognition, these financial instruments are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in the omprehensive perating tatement over the period of the interestbearing liability.

inancial instrument liabilities measured at amortised cost include all of West Gippsland Healthcare Groupss contractual payables, deposits held and advances received, and interestbearing arrangements other than those designated at fair value through the omprehensive perating tatement. Categories of financial assets previously under AASB 139 oans and receivables and cash are financial instrument assets with fixed and determinable payments that are not uoted on an active maret. hese assets and liabilities are initially recognised at fair value plus any directly attributable transaction costs. ubseuent to initial measurement, loans and receivables are measured at amortised cost using the effective interest method (and for assets, less any impairment). he West Gippsland Healthcare Group recognises the following assets in this category • cash and deposits • receivables (excluding statutory receivables); and • term deposits.

inancial liabilities at amortised cost are initially recognised on the date they are originated. hey are initially measured at fair value plus any directly attributable transaction costs. ubseuent to initial recognition, these financial instruments are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in profit and loss over the period of the interest bearing liability, using the effective interest rate method. he West Gippsland Healthcare Group recognises the following liabilities in this category • payables (excluding statutory payables); and • borrowings (including finance lease liabilities).

erecognition of financial assets financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when the rights to receive cash flows from the asset have expired. erecognition of financial liabilities financial liability is derecognised when the obligation under the liability is discharged, cancelled or expires.

mpairment of financial assets t the end of each reporting period, the West Gippsland Healthcare Group assesses whether there is obective evidence that a financial asset or group of financial assets is impaired. ll financial instrument assets, except those measured at fair value through profit or loss, are subect to annual review for impairment. he allowance is the difference between the financial asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. n assessing impairment of statutory (noncontractual) financial assets, which are not financial instruments, professional udgement is applied in assessing materiality using estimates, averages and other computational methods in accordance with mpairment of ssets.

West Gippsland Healthcare Group Annual Report 2019 101 Notes to the financial statements 30 June 2019

otes to the inancial tatements est ippsland ealthcare roup for the financial year ended une

Note 7.1 (b): Payables and Borrowings Maturity Analysis

he following table discloses the contractual maturity analysis for est ippsland ealthcare roups financial liabilities. or interest rates applicable to each class of liability refer to individual notes to the financial statements.

Maturity analysis of Financial Liabilities as at 30 June Maturity Dates Carrying Nominal Less than 1-3 3 months - 1-5 Years Note Amount Amount 1 Month Months 1 Year 2019 $'000 $'000 $'000 $'000 $'000 $'000 Financial Liabilities At amortised cost ayables orrowings ther inancial iabilities (i) ccommodation eposits ther

Total Financial Liabilities 18,727 18,727 12,081 1,065 2,494 1,743

2018 Financial Liabilities At amortised cost ayables orrowings ther inancial iabilities (i) ccommodation eposits ther

Total Financial Liabilities 16,206 16,206 10,856 1,391 2,457 1,501

(i) geing analysis of financial liabilities excludes statutory financial liabilities (i.e payable)

102 West Gippsland Healthcare Group Annual Report 2019

7.1(b) Maturity analysis Liab Notes to the financial statements 30 June 2019 65 90 the debt value credit 1826 losses 1,979 to closing Total Total in financial financial fair ippsland the impairment the credit at 46 74 subect of and expected est 120 120 relevant Days Days . . the end also investment he the 7 3 expected to the its are designated for of select at . . or rates. and 90 Days 90 90 Days 90 loss and date 4 2 measure ubect loss otes to the inancialto otes tatements to due credit 60 60 estimates . . euivalents Days Days measured past 2 5 receivables application cash expected approach. looing days expected 30 30 . . receivables and Days Days and initial oss for and mandatorily on 6 5 statutory forward cash redit default as . . assets of Current contractual Current hile allowance well allowance all . ris as the characteristics receivables xpected for loss financial 1-Jul-18 9’s ris about 30-Jun-19 ther recording opening conditions est ippslandest the financial for roup ealthcare une ended year approach credit under . contractual the been with maret shared assumptions has simplified Group’s on the assessment under determines roup approach existing on loss roup ealthcare receivables based history impairment ealthcare impairment applies to past incurred to ealthcare roup allowance ippsland contractual 139’s ippsland subect subect loss est not not ippsland est Department’s grouped the ealthcare are are the the has est expected on the replacing result include roup ippsland based net lifetime uly basis instruments a rate est this Note 7.1 (c): Contractual receivables at amortised cost receivablesamortised at 7.1 (c): Contractual Note Expected loss rate Expected loss Loss allowance rate Expected loss Loss allowance 2018 July from 1 9 – applicable AASB under assets of financial Impairment cost amortised at receivables Contractual through ross carryingcontractual amount of ross receivables carryingcontractual amount of ross receivables rom instruments instruments. uity impairment reuirementsof the identified impairment loss was immaterial. he using loss allowancethe financial at end of disclosed as above. year assessment ealthcare loss year. n

West Gippsland Healthcare Group Annual Report 2019 103 Notes to the financial statements 30 June 2019 3 o te oss at ets te nana oete a rtten reasonae s aount nstruments are no an resut s reonse nto tere te preous tere nana s oete en reeaes tan not e aoane en term amounts not rs oos are o tose oss o o otes to te nanato otes tatements near o ma as ret te rtten sae n ets osses o are te reoeres reurements te 2018 ae rom tat reurements epete to 9 90 oatons 9 reeaes useuent statutor 2019 o amounts monts eene rom 1 as onsere epense to t ontratua are oete arsn s rreoerae mte resut est Gppsanest te nana or Group eatare 3 une ene 19 ear ontratua transaton as net tere aorane a n meet te nstruments as reeaes estmate en n to pero or et te os n asse measure apat mae reonse urn are s an s an nonontratua eonom osses assets ets nestments oter eaut proson Group’s reonse o as an nana outu rs mparment or tese asse an eatare ente or ratn s reeaes neerteess proson are en ret a reoer o o Gppsan aoane statutor te reonse ears oss te est rtten pror ote 1 c ontractual receiables at amortised cost contd cost receiablesamortised at 1 c ontractual ote econciliation of te moement in te loss alloance for contractual receiables receiables contractual for alloance te loss of te moement in econciliation of te year at beinnin Balance Alloance oss penin of te year at end Balance Statutory receiables and debt inestments at amortised cost at amortised debt inestments and receiables Statutory pennretane earnns austment aopton on 9 o oatonontratua o oson nana as assets n proson n nrease reonse resutnet te rttenprosonurnunoete reeaesas o o eersa o ear te unuse proson o eersa n reonse te net resut ret epetaton n are e oeer nstruments ot counterparty’s uneatona1 uner 139 o ossaoane uponreure transton nto u 1 on 9 1 arerete aanst te same ne tem aoane eene tateene an nua reeaes mparemutua rtten as onsere ao ets onsent

104 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te nanca tateents est Gppsan eatcare Group or te nanca year ene une

ote 2 ontinent Assets and ontinent iabilities

ontnent assets an contnent ates are not reconse n te aance eet ut are scose y ay o note an uantae are easure at nona aue ontnent assets an contnent ates are presente ncuse o G receae or payae respectey

ere ere no ontnent ssets or ontnent ates or te year ene t une

West Gippsland Healthcare Group Annual Report 2019 105 Notes to the financial statements 30 June 2019

otes to te nanca tateents est Gppsan eatcare Group or te nanca year ene une

ote 8 ter disclosures

s secton ncues atona atera scosures reure y accountn stanars or oterse or te unerstann o ts nanca report

Structure econcaton o et esut or te ear to et as o ro peratn cttes esponse persons scosure euneraton o ecute cers eate artes euneraton o utors ents ccurrn ater te aance eet ate onty ontroe peratons conoc epenency s ssue tat are not yet ecte Gossary

106 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019 otes to te nanca tateents est Gppsan eatcare Group or te nanca year ene une

ote 81 econciliation of et esult for te ear to et as lo from peratin Actiities

2019 2018 000 000 et esult for te ear

onas oements eprecaton roson or outu ets ssets ecee ree o are

oements included in Inestin and inancin Actiities

et Ganoss ro sposa o onnanca ysca ssets

oements in Assets and iabilities Change in Operating Assets and Liabilities ncrease n eceaes ncrease n repayents ncrease n ayaes ncrease n rosons ncrease n nentores ecrease n ter ssets ncrease n ter ates

AS I AI AIIIS 9

West Gippsland Healthcare Group Annual Report 2019 107 Notes to the financial statements 30 June 2019

otes to te nanca tateents est Gppsan eatcare Group or te nanca year ene une

ote 82 esponsible ersons

n accorance t te nstera rectons ssue y te nster or nance uner te Financial Management Act 1994 te oon scosures are ae rearn response persons or te reportn pero eriod esponsible inisters e onourae ennessy nster or eat an nster or uance erces e onourae enny aos nster or eat an nster or uance erces e onourae artn oey nster or enta eat e onourae artn oey nster or ousn saty an en e onourae ue onnean nster or rotecton nster or saty en an arers

oernin Boards rs oan s retna apponte ay r n s ues s oy s ooroot rs auer rs as Accountable fficers

r ees

emuneration of esponsible ersons e nuer o esponse ersons are son n ter reeant ncoe ans

2019 2018 Income Band o o otal umbers 9 12

2019 2018 000 000 otal remuneration receied or due and receiable by esponsible ersons from te reportin entity amounted to

ounts reatn to te Goernn oar eers an ccountae cer are scose n est Gppsan eatcare Groups controe enttes nanca stateents

ounts reatn to esponse nsters are reporte tn te epartent o araentary erces nanca eport

108 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te nanca tateents est Gppsan eatcare Group or te nanca year ene une

ote 8 emuneration of ecuties

e nuer o eecute ocers oter tan nsters an ccountae cers an ter tota reuneraton urn te reportn pero are son n te tae eo ota annuase epoyee euaent proes a easure o u te euaent eecute ocers oer te reportn pero

emuneration of ecutie fficers otal emuneration includin ey anaement ersonnel isclosed in ote 8 2019 2018 000 000 ortter enets ostepoyent enets ter onter enets i otal emuneration 101 92

ota uer o ecutes ota nnuase poyee uaent

e tota nuer o eecute ocers ncues persons o eet te enton o ey anaeent ersonne o est Gppsan eatcare Group uner eate arty scosures an are aso reporte tn ote eate artes

nnuase epoyee euaent s ase on orn ornary ours per ee oer te reportn pero

ota reuneraton payae to eecutes urn te year ncue atona eecute ocers an a nuer o eecutes o recee onus payents urn te year ese onus payents epen on te ters o nua epoyent contracts euneraton coprses epoyee enets n a ors o conseraton pa payae or proe n ecane or serces renere an s scose n te oon cateores Sortterm mployee Benefits aares an aes annua eae or sc eae tat are usuay pa or payae on a reuar ass as e as nononetary enets suc as aoances an ree or susse oos or serces ostemployment Benefits ensons an oter retreent enets pa or payae on a screte ass en epoyent as cease ter onterm Benefits on serce eae oter onserce enet or eerre copensaton ermination Benefits ernaton o epoyent payents suc as seerance pacaes

West Gippsland Healthcare Group Annual Report 2019 109 Notes to the financial statements 30 June 2019

otes to te nanca tateents est Gppsan eatcare Group or te nanca year ene une

ote 8 elated arties

est Gppsan eatcare Group s a oy one an controe entty o te tate o ctora eate partes o te est Gppsan eatcare Group ncue · All key management personnel (KMP) and their close family members; anet nsters ere appcae an ter cose ay eers · Jointly Controlled Operation - Gippsland Health Alliance; and · All hospitals and public sector entities that are controlled and consolidated into the State of Victoria financial statements.

s are tose peope t te autorty an responsty or pannn rectn an contron te acttes o est Gppsan eatcare Group an ts controe enttes recty or nrecty

ey anaeent ersonne o te est Gppsan eatcare Group ncue tose persons ente an ste uner ote esponse ersons an controe enttes o GG e copensaton etae eo s reporte n an ecues te saares an enets te ortoo nsters recee e Minister’s reuneraton an aoances s set y te Parliamentary Salaries and Superannuation Act 1968 an s reporte tn te epartent o Parliamentary Services’ Financial Report. 2019 2018 000 000 ompensation s ortter poyee enets ostepoyent enets ter onter enets ii otal 0 8

ota reuneraton pa to s epoye as a contractor urn te reportn pero trou accounts payae as een reporte uner sortter epoyee enets s are aso reporte n ote esponse ersons or ote euneraton o ecutes Sinificant ransactions it oernment elated ntities e est Gppsan eatcare Group recee unn ro te epartent o eat an uan erces o an nrect contrutons o penses ncurre y te est Gppsan eatcare Group n eern serces an outputs are n accorance t eat urcasn ctora reureents Goos an serces ncun procureent anostcs patent eas an utste operatona support are proe y oter ctoran eat erce roers on coerca ters roessona eca nenty nsurance an oter nsurance proucts are otane ro te ctoran anae nsurance utorty e tann rectons o te ssstant reasurer reure te est Gppsan eatcare Group to o cas n ecess o orn capta n accorance t te State’s centrase ann arraneents orrons are reure to e source ro reasury orporaton ctoran uness an eepton as een approe y te nster or eat an uan erces an te reasurer eer ote an ransactions it s and ter elated arties Gen te reat an ept o tate oernent acttes reate partes transact t te ctoran puc sector n a anner consstent t oter eers o te puc e stap uty an oter oernent ees an cares urter epoyent o processes tn te ctoran puc sector occur on ters an contons consstent t te uc nstraton ct an oes o onuct an tanars ssue y te ctoran uc ector osson rocureent processes occur on ters an contons consstent t te ctoran Goernent rocureent oar reureents utse o nora cten type transactons t te est Gppsan eatcare Group tere ere no reate party transactons tat noe ey anaeent personne ter cose ay eers an ter persona usness nterests o proson as een reure nor any epense reconse or parent o receaes ro reate partes ere ere no reate party transactons t anet nsters reure to e scose n

ere ere no reate party transactons reure to e scose or te est Gppsan eatcare Group oar o rectors an e ecute cer n

110 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te Financial Statements est ippslan ealtcare rop or te inancial year ene ne

ote 8 elated arties contd

cept or te transaction liste elo tere ere no oter relate party transactions reire to e isclose or te est ippslan ealtcare rop Fonation oar o irectors in . undin eceied ntity escription of Serice 2019 2018 000 000 Monas ealt Provision o linen Services lre ealt Provision o linen Services atroe Reional ospital ransition are Proram ippslan ealt lliance normation ecnoloy

ayments ade ntity escription of Serice 2019 2018 000 000 ictorian Manae nsrance tority nnal nsrance premim mlance ictoria Provision o patient transport services Monas ealt octors on rotation atroe Reional ospital octors on rotation ippslan ealt lliance normation ecnoloy

ebtors eceiable at 0 June ntity escription of Serice 2019 2018 000 000 Monas ealt Provision o linen Services lre ealt Provision o linen Services atroe Reional ospital ransition are Proram

ere are no material relate parties creitors payale as at t ne

West Gippsland Healthcare Group Annual Report 2019 111 Notes to the financial statements 30 June 2019

otes to te Financial Statements est ippslan ealtcare rop or te inancial year ene ne

ote 8 emuneration of Auditors

2019 2018 000 000

ictorian Auditorenerals ffice

it o te Financial Statements

A AI AIS 1 1

112 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te Financial Statements est ippslan ealtcare rop or te inancial year ene ne

ote 8 ents ccurrin after te Balance Seet ate

n te r ly receive a letter rom te epartment o ealt an man Services S tat conirme te impact o te nplanne teatre closres rom May to t ne represente rons or a orce maere event. s sc S avise tat it ill aiver p to million o PlicPrivate S tat ol oterise e sect to recall or . is ill e aste tro te Prior ear stment process rin . ilst tis event is elo materiality elieves tis event is sel inormation to isclosre as part o its annal inancial report or .

West Gippsland Healthcare Group Annual Report 2019 113 Notes to the financial statements 30 June 2019

otes to te Financial Statements est ippslan ealtcare rop or te inancial year ene ne

ote 8 Jointly ontrolled perations

nersip Interest ame of ntity rincipal Actiity 2019 2018

ippslan ealt lliance normation ecnoloy . .

est ippslan ealtcare rops interest in te aove ointly controlle operations are etaile elo. e amonts are incle in te consoliate inancial statements ner teir respective cateories

2019 2018 000 000

ASSS as an as ivalents Receivales ter A ASSS 11 19

ASSS Property Plant an ipment A ASSS 11 28 A ASSS 12 1

IABIIIS Payales ccre penses ter A IABIIIS 12 1 A IABIIIS 12 1

ASSS 120 1

I ccmlate Srplseseicits A I 120 1

est ippslan ealtcare rops interest in revenes an epenses resltin rom ointly controlle operations are etaile elo 2019 2018 000 000

ter ncome nterest ncome A 12 210

SS ter penses rom ontinin perations epreciation A SS 208 1 S

ontinent iabilities and apital ommitments ere are no non continent liailities or capital commitments el y te ointly controlle operations at alance ate.

114 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

otes to te Financial Statements est ippslan ealtcare rop or te inancial year ene ne

ote 88 conomic ependency

est ippslan ealtcare rop is epenent on te epartment o ealt an man Services or te maority o its revene se to operate te entity. t te ate o tis report te oar o irectors as no reason to elieve te epartment ill not contine to spport est ippslan ealtcare rop

West Gippsland Healthcare Group Annual Report 2019 115 30 June 2019 Notes to the financial statements otes to te Financial Statements est ippslan ealtcare rop or te inancial year ene ne

ote 89 AASBs Issued tat are not yet ffectie

ertain ne stralian accontin stanars ave een plise tat are not manatory or te ne reportin perio. epartment o reasry an Finance assesses te impact o all tese ne stanars an avises est ippslan ealtcare rop o teir applicaility an early aoption ere applicale. s at ne te olloin stanars an interpretations a een isse y te S t ere not yet eective. ey ecome eective or te irst inancial statements or reportin perios commencin ater te state operative ates as etaile in te tale elo. est ippslan ealtcare rop as not an oes not inten to aopt tese stanars early.

Applicable for annual Standard/ Interpretation Summary reporting Impact on public sector entity financial statements periods beginning on

The changes in revenue recognition requirements in AASB The core principle of AASB 15 requires an entity to 15 may result in changes to the timing and amount of recognise revenue when the entity satisfies a revenue recorded in the financial statements. Revenue performance obligation by transferring a promised good from grants that are provided under an enforceable or service to a customer. Note that amending standard AASB 15 Revenue from Contracts with agreement that have sufficiently specific obligations, will AASB 2015 8 Amendments to Australian Accounting 1-Jan-19 Customers now be deferred and recognised as the performance Standards – Effective Date of AASB 15 has deferred the obligations attached to the grant are satisfied. WGHG effective date of AASB 15 to annual reporting periods does not expect any material transactions of this nature beginning on or after 1 January 2018, instead of 1 therefore the impact of implementing AASB 15 will be January 2017 for Not-for-Profit entities. minimal. AASB 2018-4 provides additional guidance for not-for- profit public sector licenses, which include: Matters to consier in istinisin eteen a ta an S Amendments to a license it all taes ein acconte or ner S S amens S an S to Australian Accounting Standards – provie iance or revene reconition in Australian Implementation Guidance an connection it taes an onP licences or otor P licenses to e acconte or ner S an for Not‑for-Profit Public-Sector Proit entities. Licensors onP sc as casino licenses are to e acconte or in accorance it te principles o S ater irst avin etermine eter any part o te arranement sol e acconte or as a lease ner S .

AASB 2016-8 Amendments to Australian This standard clarifies the application of AASB 15 and AASB 2016-8 inserts Australian requirements and Accounting Standards – Australian AASB 9 in a not-for-profit context. The areas within these authoritative implementation guidance for not-for-profit- Implementation Guidance for Not‑for- standards that are amended for not-for-profit application entities into AASB 9 and AASB 15. Profit Entities include: This Standard amends AASB 9 and AASB 15 to include AASB 9 requirements to assist not-for-profit entities in applying Stattory receivales are reconise an measre the respective standards to particular transactions and similarly to inancial assets. events. AASB 1 1-Jan-19 · The ‘customer’ does not need to be the recipient of oos anor services · The “contract” could include an arrangement entered into ner te irection o anoter party ontracts are enorceale i tey are enorceale y legal or ‘equivalent means’; ontracts o not ave to ave commercial sstance only economic sstance an

. Performance obligations need to be ‘sufficiently specific’ to e ale to apply S to tese transactions.

e assessment as inicate tat most operatin leases it te eception o sort term an lo vale leases ill come on to te alance seet an ill e reconise as rit o se assets it a corresponin lease liaility. e ey canes introce y S incle te S Leases reconition o most operatin leases ic are crrently an n te operatin statement te operatin lease epense not reconise on alance seet. ill e replace y epreciation epense o te asset an an interest care.

ll operatin leases relate to lo vale assets implementin S ill ave nil impact.

Under AASB 1058, not-for-profit entities are required to measure right-of-use assets at fair value at initial recognition for leases that have significantly below- market terms and conditions. For right-of-use assets arising under leases with This standard amends various other accounting significantly below market terms and conditions standards to provide an option for not-for-profit entities principally to enable the entity to further its objectives to not apply the fair value initial measurement (peppercorn leases), AASB 2018-8 provides a temporary AASB 2018-8 Amendments to Australian requirements to a class or classes of right of use assets option for Not-for-Profit entities to measure at initial Accounting Standards – Right of Use arising under leases with significantly below-market 1-Jan-19 recognition, a class or classes of right-of-use assets at Assets of Not-for-Profit entities terms and conditions principally to enable the entity to cost rather than at fair value and requires disclosure of further its objectives. This Standard also adds additional the adoption. disclosure requirements to AASB 16 for not-for-profit The State has elected to apply the temporary option in entities that elect to apply this option. AASB 2018-8 for not-for-profit entities to not apply the fair value provisions under AASB 1058 for these right-of- use assets. In making this election, the State considered that the methodology of valuing peppercorn leases was still being developed.

116 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements otes to30 the inancial June tatements 2019 est ippsland ealthcare roup for the financial year ended une

ote 89 AASBs Issued tat are not yet ffectie

Alicale for annual Standard nterretation Suar reorting act on ulic sector entit financial stateents eriods eginning on

ill replace the maority of income recognition in relation to government grants and other rant revenue is currently recognised up front upon types of contributions requirements relating to public receipt of the funds under ontriutions . sector notforprofit entities previously in ontriutions .

The timing of revenue recognition for grant agreements The restructure of administrative arrangement ill remain that fall under the scope of may be deferred. ncoe of otforrofit under and ill be restricted to government or eample revenue from capital grants for the an Entities entities and contributions by oners in a public sector construction of assets ill need to be deferred and contet recognised progressively as the asset is being constructed.

The impact on current revenue recognition of the changes establishes principles for transactions that are is the potential phasing and deferral of revenue recorded not ithin the scope of here the consideration in the operating statement. does not epect any to acquire an asset is significantly less than fair value to material transactions of this nature therefore the impact enable notforprofit entities to further their obective. of implementing ill be minimal.

he ne Australian standard eliinates inconsistencies and eanesses in eisting ractices roviding a single rincile ased fraeor to account for all tes of insurance contracts including reissuance contract that he assessent has indicated that there ill e no AASB 1 nsurance ontracts 1an1 an insurer holds t also rovides reuireents for significant iact for the ulic sector resentation and disclosure to enhance coarailit eteen entities his standard currentl does not al to the notfor rofit ulic sector entities

This tandard principally amends resentation of inancial Stateents and Accounting olicies hanges in Accounting Estiates and Errors . The amendments refine and clarify the definition of Aendents to Australian material in and its application by improving the The standard is not epected to have a significant impact Accounting Standards – Definition of an ording and aligning the definition across on the public sector. aterial tandards and other publications. The amendments also include some supporting requirements in in the definition to give it more prominence and clarify the eplanation accompanying the definition of material.

or an arrangeent to e in scoe of AASB 15 all of 1an the folloing reuireents are to e satisfied he State is · erator is roviding ulic services using a intending to service concession asset · Operator manages at ‘least some’ of public earl adot his standard alies to arrangeents that involve an services under its on discretion AASB 15 for oerator roviding a ulic service on ehalf of a ulic · he State controls regulates annual sector grantor t involves the use of a service – hat services are to e rovided reorting concession asset and here the oerator anages at eriods AASB 15 Service oncession least soe of the ulic service at its on direction An eginning on – to ho and Arrangeents rantor arrangeent ithin the scoe of this standard ticall or after 1 involves an oerator constructing the asset used to anuar 1 rovide the ulic service or ugrading the assets and – at hat rice oerating and aintaining the assets for a secified · State controls an significant residual interest in eriod of tie the asset

f the arrangeent does not satisf all the aove reuireents the recognition ill fall under the reuireents of another alicale accounting standard

an

The tate is This standard defers the mandatory effective date of intending to for periods beginning on or after anuary Aendents to Australian This standard defers the mandatory effective date of early adopt to anuary . s the tate has elected to early Accounting Standards – Deferral of AASB from anuary to anuary . for adopt the financial impact ill be reported in 15 annual the financial year ending une rather than the reporting folloing year. periods beginning on or after anuary

West Gippsland Healthcare Group Annual Report 2019 117 118 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019

ote 810 lossary of terms and style conentions

Actuarial ains or losses on superannuation defined benefit plans • experience adjustments (the effects of differences between the previous actuarial assumptions and what has actually occurred); and • the effects of changes in actuarial assumptions. Amortisation Associates ompreensie result ommitments

urrent rants

epreciation expense reduces the ‘net result for the year’. ffectie interest metod

mployee benefits epenses

inancial asset • cash; • an equity instrument of another entity; • a contractual or statutory right: – to receive cash or another financial asset from another entity; or – to exchange financial assets or financial liabilities with another entity under conditions that are potentially favorable to the entity; or • a contract that will or may be settled in the entity’s own equity instruments and is: – a non-derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments; or – number of the entity’s own equity instruments.

inancial instrument

inancial liability • A contractual obligation: – to deliver cash or another financial asset to another entity; or – to exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavorable to the entity; or • A contract that will or may be settled in the entity’s own equity instruments and is: – a non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments; or – entity’s entity’s themselves contracts for the future receipt or delivery of the entity’s own equity instruments. inancial statements • Balance sheet as at the end of the period; • Comprehensive operating statement for the period; • A statement of changes in equity for the period; • Cash flow statement for the period; • Notes, comprising a summary of significant accounting policies and other explanatory information; • •

West Gippsland Healthcare Group Annual Report 2019 119 Notes to the financial statements 30 June 2019 Notes to the inancial tatements est ippsland ealthcare roup for the financial year ended une

ote 810 lossary of terms and style conentions contd

rants and oter transfers ransactions in which one unit provides goods, services, assets (or extinguishes a liability) or labour to another unit without receiving approximately equal value in return. rants can either be operating or capital in nature. hile grants to governments may result in the provision of some goods or services to the transferor, they do not give the transferor a claim to receive directly benefits of approximately equal value. or this reason, grants are referred to by the AAB as involuntary transfers and are termed non-reciprocal transfers. eceipt and sacrifice of approximately equal value may occur, but only by coincidence. or example, governments are not obliged to provide commensurate benefits, in the form of goods or services, to particular taxpayers in return for their taxes. rants can be paid as general purpose grants which refer to grants that are not subject to conditions regarding their use. Alternatively, they may be paid as specific purpose grants which are paid for a particular purpose andor have conditions attached regarding their use. eneral oernment sector he general government sector comprises all government departments, offices and other bodies engaged in providing services free of charge or at prices significantly below their cost of production. eneral government services include those which are mainly non-maret in nature, those which are largely for collective consumption by the community and those which involve the transfer or redistribution of income. hese services are financed mainly through taxes, or other compulsory levies and user charges.

Interest epense Costs incurred in connection with the borrowing of funds includes interest on ban overdrafts and short-term and long-term liabilities, amortisation of discounts or premiums relating to liabilities, interest component of finance leases repayments, and the increase in financial liabilities and non-employee provisions due to the unwinding of discounts to reflect the passage of time. Interest income nterest income includes unwinding over time of discounts on financial assets and interest received on ban term deposits and other investments. Inestment properties nvestment properties represent properties held to earn rentals or for capital appreciation or both. nvestment properties exclude properties held to meet service delivery objectives of the tate of ictoria. Joint Arranements A joint arrangement is an arrangement of which two or more parties have joint control. A joint arrangement has the following characteristics: • The parties are bound by a contractual arrangement. • The contractual arrangement gives two or more of those parties joint control of the arrangement A joint arrangement is either a joint operation or a joint venture iabilities iabilities refers to interest-bearing liabilities mainly raised from public liabilities raised through the reasury Corporation of ictoria, finance leases and other interest-bearing arrangements. iabilities also include non-interest-bearing advances from government that are acquired for policy purposes. et acuisition of nonfinancial assets from transactions urchases (and other acquisitions) of non-financial assets less sales (or disposals) of non-financial assets less depreciation plus changes in inventories and other movements in non-financial assets. t includes only those increases or decreases in non-financial assets resulting from transactions and therefore excludes write-offs, impairment write-downs and revaluations. et result Net result is a measure of financial performance of the operations for the period. t is the net result of items of income, gains and expenses (including losses) recognised for the period, excluding those that are classified as ‘other comprehensive income’. Net result from transactionsnet operating balance Net result from transactions or net operating balance is a ey fiscal aggregate and is income from transactions minus expenses from transactions. t is a summary measure of the ongoing sustainability of operations. t excludes gains and losses resulting from changes in price levels and other changes in the volume of assets. et ort Assets less liabilities, which is an economic measure of wealth.

onfinancial assets Non-financial assets are all assets that are not ‘financial assets’. t includes inventories, land, buildings, infrastructure, road networs, land under roads, plant and equipment, investment properties, cultural and heritage assets, intangible and biological assets.

onproduced assets Non-produced assets are assets needed for production that have not themselves been produced. hey include land, subsoil assets, and certain intangible assets. Non-produced intangibles are intangible assets needed for production that have not themselves been produced. hey include constructs of society such as patents. onprofit institution A legal or social entity that is created for the purpose of producing or distributing goods and services but is not permitted to be a source of income, profit or other financial gain for the units that establish, control or finance it. ayables ncludes short and long term trade debt and accounts payable, grants, taxes and interest payable.

roduced assets roduced assets include buildings, plant and equipment, inventories, cultivated assets and certain intangible assets. ntangible produced assets may include computer software, motion picture films, and research and development costs (which does not include the startup costs associated with capital projects).

120 West Gippsland Healthcare Group Annual Report 2019 Notes to the financial statements 30 June 2019 otes to the inancial tatements est ippsland ealthcare roup for the financial year ended une

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ublic financial corporation sector ublic financial corporations (s) are bodies primarily engaged in the provision of financial intermediation services or auxiliary financial services. They are able to incur financial liabilities on their own account (e.g. taing deposits, issuing securities or providing insurance services). stimates are not published for the public financial corporation sector.

ublic nonfinancial corporation sector The public nonfinancial corporation () sector comprises bodies mainly engaged in the production of goods and services (of a non financial nature) for sale in the maret place at prices that aim to recover most of the costs involved (e.g. water and port authorities). n general, s are legally distinguishable from the governments which own them. eceiables ncludes amounts owing from government through appropriation receivable, short and long term trade credit and accounts receivable, accrued investment income, grants, taxes and interest receivable.

Sales of oods and serices efers to income from the direct provision of goods and services and includes fees and charges for services rendered, sales of goods and services, fees from regulatory services and wor done as an agent for private enterprises. t also includes rental income under operating leases and on produced assets such as buildings and entertainment, but excludes rent income from the use of nonproduced assets such as land. ser charges includes sale of goods and services income.

Supplies and serices upplies and services generally represent cost of goods sold and the daytoday running costs, including maintenance costs, incurred in the normal operations of the epartment. aation income Taxation income represents income received from the State’s taxpayers and includes: • payroll tax; land tax; duties levied principally on conveyances and land transfers; • gambling taxes levied mainly on private lotteries, electronic gaming machines, casino operations and racing; • insurance duty relating to compulsory third party, life and non-life policies; • insurance company contributions to fire brigades; • motor vehicle taxes, including registration fees and duty on registrations and transfers; • levies (including the environmental levy) on statutory corporations in other sectors of government; and • other taxes, including landfill levies, license and concession fees.

ransactions evised Transactions are those economic flows that are considered to arise as a result of policy decisions, usually an interaction between two entities by mutual agreement. They also include flows in an entity such as depreciation where the owner is simultaneously acting as the owner of the depreciating asset and as the consumer of the service provided by the asset. Taxation is regarded as mutually agreed interactions between the government and taxpayers. Transactions can be in ind (e.g. assets providedgiven free of charge or for nominal consideration) or where the final consideration is cash.

Style conentions igures in the tables and in the text have been rounded. iscrepancies in tables between totals and sums of components reflect rounding. ercentage variations in all tables are based on the underlying unrounded amounts. The notation used in the tables is as follows ero, or rounded to ero (xxx.x) negative numbers x year period xx year period

West Gippsland Healthcare Group Annual Report 2019 121 Disclosure Index

The annual report of the West Gippsland Healthcare Group is prepared in accordance with all relevant Victorian legislation. This index has been prepared to facilitate identification of the Department’s compliance with statutory disclosure requirements.

Ministerial Directions Legislation Requirement Page Page

Charter and purpose Legislation FRD 22H Manner of establishment and the FRD 22H Application and operation of Freedom relevant Ministers...... 2,12 of Information Act 1982...... 46 FRD 22H Purpose, functions, powers and duties ...... 12 FRD 22H Compliance with building and maintenance FRD 22H Nature and range of services provided...... 10 provisions of Building Act 1993...... 46 FRD 22H Activities, programs and achievements FRD 22H Application and operation of Protected for the reporting period...... 4, 16-21 Disclosure 2012...... 48 FRD 22H Significant changes in key initiatives FRD 22H Statement on National Competition Policy...... 46 and expectations for the future...... 4-5 FRD 22H Application and operation of Carers Management and structure Recognition Act 2012 ...... 47 FRD 22H Organisational structure...... 15 FRD 22H Summary of the entity’s environmental FRD 22H Workforce data/ employment and performance...... 44-45 conduct principles...... 23 FRD 22H Additional information available on request.... 49 FRD 22H Occupational Health and Safety...... 24 Financial and other information Other relevant reporting directives FRD 22H Summary of the financial results for the year .... 43 FRD 25D Local Jobs First Act disclosures...... 46 FRD 22H Significant changes in financial position SD 5.1.4 Financial Management Compliance attestation.. 50 during the year...... 43 SD 5.2.3 Declaration in report of operations...... 4 FRD 22H Operational and budgetary objectives and performance against objectives...... 43 Attestations FRD 22H Subsequent events...... 41, 113 Attestation on Data Integrity...... 50 FRD 22H Details of consultancies under $10,000...... 48 Attestation on managing Conflicts of Interest...... 50 FRD 22H Details of consultancies over $10,000 ...... 48 Attestation on Integrity, fraud and corruption...... 50 FRD 22H Disclosure of ICT expenditure...... 47 Other reporting requirements • Reporting of outcomes from Statement of

Priorities 2018–19...... 32-39 • Occupational Violence reporting...... 24 • Reporting of compliance Health Purchasing Victoria policy...... 50 • Reporting obligations under the Safe Patient Care Act 2015...... 48 • Reporting of compliance regarding Car Parking Fees (if applicable)...... NA

122 West Gippsland Healthcare Group Annual Report 2019 Thankyou BLYTH BROTHERS DONATING FOR

For the past 25 years, the Blyth Bros Farm at Ellinbank has donated 50,000 bulbs annually to support West Gippsland Hospital’s daffodil fundraiser. This has helped raise approximately $380,000 worth of medical equipment to support allied and community health programs.

West Gippsland Healthcare Group Annual Report 2019 123 HEAD OFFICE West Gippsland Hospital 41 Landsborough Street Warragul, Victoria 3820 Phone: 03 5623 0611 Fax: 03 5623 0806 Email: [email protected]

124 West Gippsland Healthcare Group Annual Report 2019