For the Year Ended 31 December 2019 Table of Contents

MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

FINANCIAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2019 TABLE OF CONTENTS

Page Report of Operations 1 Directors' Report 2 Victorian Auditor General's Independence Declaration 7 Income and Other Comprehensive Income Statement 8 Statement of Financial Position 9 Statement of Changes in Equity 10 Statement of Cash Flows 11 Notes to the Financial Statements 12 Directors' Declaration 25 Victorian Auditor General's Report 26 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

REPORT OF OPERATIONS

YEAR ENDED 31 DECEMBER 2019

General Information

Establishment

Melbourne University Publishing Limited ("the Company") was registered with the Australian Securities and Investment Commission on the nineteenth day of December 2002 and the Australian Charities and Not-for-profits Commission on the third day of December of 2012. The Company is an unlisted Australian Public Company and is limited by Guarantee.

Objective The objective of Melbourne University Publishing Limited is to publish scholarly works of excellence from Australia and abroad, within and beyond the University sector, under two main imprints - Melbourne University Press and The Miegunyah Press. The Miegunyah Press is supported by a bequest established by Sir Russell and Lady Grimwade to publish titles of national significance with the highest editorial and production standards. Melbourne University Publishing Limited seeks to be the academic publisher of choice in Australia. Melbourne University Publishing Limited also publishes the journal Meanjin.

Administrative Structure

Chief Executive Officer

The Chief Executive Officer and Publisher in Chief is Dr Nathan Hollier.

Organisational Structure

An organisational chart setting out the structure of the Company as at 31 December 2019 is appended.

Workforce Data

Staff of the Company

At 31 December 2019 the Company employed 8.9 FTE (2018: 9.75 FTE).

Merit and Equity Policy

The Company has in place a Merit and Equity Policy, which includes policies relating to anti-discrimination, equal employment opportunity, and harassment and victimisation.

Occupational Health and Safety

The Company follows the University of Melbourne's policy and its procedures in relation to occupational health and safety. A local committee monitors occupational health and safety issues.

Freedom of Information Act 1982

As a subsidiary of the University of Melbourne, the Company is not subject to the Freedom of Information Act 1982. No requests for information were received in 2019.

Protected Disclosure Act 2012

The Company is committed to ensuring full compliance with the Protected Disclosure Act 2012 and its predecessor act, the Whistleblowers Protection Act 2001 . The Company received no submissions under this act during 2019.

1 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

DIRECTORS' REPORT

YEAR ENDED 31 DECEMBER 2019

The Directors present their report together with the financial statements of Melbourne University Publishing Limited (the Company) for the financial year ended 31 December 2019.

Directors The names and particulars of the directors in office during or since the end of the financial year are:

Professor Warren Bebbington, Chairman (appointed 20 December 2018) He is a Professorial Fellow at the LH Martin Institute, Graduate School of Education, University of Melbourne; Professor Emeritus, University of Adelaide; and Visiting Professor, National Academy for Education Administration, PR China. He was Vice Chancellor and President, University of Adelaide for 5 years until April 2017, and prior to that Deputy Vice Chancellor, University of Melbourne.

His board positions have included terms as Deputy Chair, Universities Australia; Chair, Board of South Australian Tertiary Admissions Centre; Chair, SA Vice Chancellors’ Committee; Chair, Australian Music Examinations Board; and 7 years as Chair of Music Committees for the Australia Council. He is currently Chair, Melbourne University Press, Chair, Board of the arts and design college LCI-Melbourne and Chair of autism peak body Amaze Inc.

Educated at University of Melbourne then as a Fulbright Scholar in New York, he holds a PhD and Masters degrees in Arts, Music and Philosophy.

Dr Nathan Hollier, Chief Executive Officer (appointed 1 July 2019) Dr Nathan Hollier is MUP’s CEO and Publisher in Chief. He is a member of the Scholarly and Journals Committee of the Australian Publishers Association and of the board of the OL Society Ltd, publishers of Overland magazine. He was Director of Monash University Publishing (2009–2019), a member of the federal government’s Book Industry Collaborative Council (2012–2013), Editor of Overland magazine 2002–2007 and in 2006 founding Chair of the Small Press Network, the representative body for small and independent presses in Australia. Hollier has a PhD in Australian History, lectured at Victoria University for ten years, and is the author of two books and many articles on aspects of Australian society. He received a Monash University Vice-Chancellor’s Award for Outstanding Performance by Professional Staff in 2014 and was a 2018–2019 Copyright Agency Publisher Fellow.

Mr Allan Tait BSocSc ACA (appointed 31 May 2012) Allan Tait has been Chief Financial Officer of the University of Melbourne since April 2009. He was Chief Executive Officer of UoM Commercial Ltd, the University's commercialisation company, from June 2005 to September 2009, during which time he led the restructure of the private university. Prior to joining the University Allan was a partner in the corporate finance group at PricewaterhouseCoopers, finance director of the local investment banking subsidiary of the Toronto Dominion Bank, and CEO of Gadens Lawyers (Melbourne). Allan is a chartered accountant and a member of the institutes in both Australia and the UK, and a member of the Finance and Management Faculty of the institute in the UK. He has a degree in economic history from the University of Birmingham (England) and he is a member of the Institute of Company Directors.

Professor Ian Young AO (appointed 11 December 2017)

Professor Ian Young AO has had a career that has spanned both senior Higher Education administration and scientific research. He is presently Kernot Professor of Engineering at the University of Melbourne. Prior to this appointment he held the administrative roles of Vice- Chancellor of the Australian National University and Vice-Chancellor of Swinburne University of Technology. During 2014 and 2015, he was Chair of the Group of Eight. When he retired from ANU in 2016, he was the second longest serving Vice-Chancellor in Australia. His research interests concern wind generated ocean waves. He has an extensive publication record in areas such as: the physics of air-sea interaction, the numerical modeling of waves, finite depth waves, satellite remote sensing and ocean wind and wave climate. In recent years, his research has concentrated on the use of satellite measurements of the ocean to understand changes in wind and wave climates on a global scale.

He presently holds a number of external roles including: Chair of the Board VERNet Pty Ltd., Chair of the Board of CloudCampus Pty Ltd., Chair Education Advisory Board of Cluey Pty Ltd., Chair Advisory Committee of Centre of Excellence in Gravitational Waves, Board Member International Centre for Democratic Partnerships, Chief Executive Conviro Pty Ltd.

2 Professor Margaret Abernethy B.Ec. Ph.D (appointed 1 January 2018) Professor Margaret (Maggie) Abernethy is an expert in cost accounting, budgeting, performance management, compensation design and other corporate governance issues. She holds a research position as the Sir Douglas Copland Chair of Commerce and the Chair of Managerial Accounting at the University of Melbourne. Maggie regularly publishes in the leading accounting journals; she is editor of two major journals and on the editorial board of numerous journals. She has received competitive research grants of more than $2.8 million and recently established the Melbourne Centre for Corporate Governance and Regulation. Maggie also contributed to leadership within the University over a 14-year period as Dean of the Faculty of Business and Economics, head of department and Associate Dean (Research). She has considerable experience in the public sector through her contributions as Commissioner for the Monash City Council and to several boards. She was awarded the Telstra Business Woman of the Year (Government and Community) in 2008 for her outstanding contribution to higher education. In 2011 Maggie was elected as a Fellow of the Academy of Social Sciences and in 2018 inducted into the Australian Accounting Hall of Fame.

Ms Gabrielle Coyne (appointed 14 March 2019)

Ms Gabrielle Coyne has extensive senior management experience in publishing and was Chief Executive Officer for Penguin Random House Asia Pacific from 2013 until 2016 and prior to that, CEO of Penguin Asia Pacific. During this time, she implemented a strategy for new markets, including digital, and led the business at a time of digital and market disruption. Gabrielle was a founding board member of The Wheeler Centre is also on the boards of Australian Super, The Aēsop Foundation and Cool Australia

Dr Sandra McComb (appointed 14 March 2019)

Dr Sandra McComb has been a Visiting Fellow at the Australian National University since 2015 where she holds a Doctor of Philosophy. Dr McComb has over 35 years of experience in publishing, including 14 years in senior positions at Cambridge University Press and Oxford University Press (Australia). Dr McComb has provided consultancy on publishing to the Academy of Science, Charles Darwin University and Cambridge University Press.

Mr Laurie Muller, Chairman AM (resigned 31 January 2019)

Laurie Muller has been a book publisher for four decades including appointments as CEO of University of Queensland Press, CEO of Lansdowne Press /Hamlyn Group and General Manager of Rigby Ltd. He brings publishing and management skills and experience to the Board. He has been President of the Australian Book Publishers Association, Chairman of Brisbane Writers Festival, Member of the State Library Board of Queensland and a Member of the Queensland Arts Advisory Committee. He was made a Member of the Order of Australia in 1990 and awarded the Gold Medal of the National Book Council in 1991, both for services to the Australian Book Industry.

Ms Louise Adler, AM (Chief Executive Officer and Publisher-in-Chief) BA (Reading), MA (Columbia), MPhil (Columbia) (resigned 31 January 2019)

Louise Adler, CEO and the Publisher-in-Chief of Melbourne University Publishing Limited, resigned on 31 January 2019. She brings considerable publishing, media and literary skills and experience to the Board. She was Publishing Director at Reed Books Australia 1989-94 and presenter of Arts Today on ABC Radio National 1996-99. From 1999 to 2002 she was Deputy Director (Academic & Research) at the Victorian College of the Arts. She was previously the Chair of the Board of Methodist Ladies' College, a member of the Monash University Council, a Board member of The Australian Centre for Contemporary Art, Melbourne and a Director of the Melbourne International Arts Festival.

Mr Daniel (Danny) Gorog (resigned 31 January 2019)

Daniel is the co-founder and Director of Outware Mobile and has extensive experience in business management, IT systems and project management. He is also a recognised media commentator. His writing appears in the Herald Sun, The Age and Macworld Australia and he presents weekly on SEN’s The Run Home program and Melbourne Talk Radio’s Sunday weekend. Daniel holds a Bachelors of Commerce and Science from the University of Melbourne and Post Graduate Diploma in Management from the Melbourne Business School.

Mr Tony Peake (resigned 31 January 2019) Tony is the National Leader – Government at PwC Australia where he heads PwC’s team that focuses on delivery to government departments, business enterprises and statutory authorities. He has strong relationships with people across the political and public service spectra. Tony has a number of current pro bono interests including Chair of Methodist Ladies’ College. Tony was previously a Council Member at The University of Melbourne, Director and Treasurer of the Melbourne Festival, Advisor to the Trustees of the Marian and EH Flack Trust, Chairman of MU Student Union Limited (the University of Melbourne student union company), and a Director of The Australian Embassy for Timor-Leste Fund. He is a Victorian Fellow of the Institute of Public Administration Australia, Fellow of The Institute of Chartered Accountants in Australia and Fellow of Leadership Victoria’s Williamson Community Leadership Program.

Professor the Hon Bob Carr (resigned 31 January 2019)

Former Foreign Minister Bob Carr is also the longest continuously serving Premier in New South Wales history. As Premier Bob received the World Conservation Union International Parks Merit Award for creating 350 new national parks. He was made a life member of the Wilderness Society in 2003. Bob received the Fullbright Distinguished Fellow Award Scholarship. He has served as Honorary Scholar of the Australian American Leadership Dialogue. He is the author of Thoughtlines (2002), What Australia Means to Me (2003), My Reading Life (2008) and Diary of a Foreign Minister (2014). Bob is a Professor in International Relations and the Director of the Australia-China Relations Institute at the University of Technology Sydney, the only Australian think tank devoted to illuminating the Australia-China relationship.

3 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

DIRECTORS' REPORT

YEAR ENDED 31 DECEMBER 2019 Directors (Cont.)

Professor Gillian Triggs (resigned 31 January 2019)

Emeritus Professor Gillian Triggs is the President of the Australian Human Rights Commission. Gillian was Dean of the Faculty of Law and Challis Professor of International Law at the University of Sydney from 2007-12 and Director of the British Institute of International and Comparative Law from 2005-7. Gillian is a former Barrister and a Governor of the College of Law. Gillian graduated in Law from the University of Melbourne in 1968 and gained a PhD in 1982. She has combined an academic career with international commercial legal practice and worked with governments and international organisations advising on international law. As president of the Human Rights Commission Gillian has focused on the implementation in Australian law of the human rights treaties to which Australia is a party. Gillian has been the Chair of the Council of Australian Law Deans, a consultant on International Law to King & Wood Mallesons, the Australian representative on the Council of Jurists for the Asia Pacific Forum for National Human Rights Institutions, Chair of the Board of the Australian International Health Institute, and a member of the Attorney-General's International Legal Service Advisory Council. She is the author of many books and paper, including International Law: Contemporary Principles and Practices (Second Edition, 2011).

Gillian also served as Acting Aboriginal and Torres Strait Islander Social Justice Commissioner for eight months from 1 August 2016 to 3 April 2017.

Mr Richard Tegoni (Chief Executive Officer) MBA AGSM, (resigned 30 June 2019)

Richard Tegoni first joined MUP as Chief Operating Officer and Company Secretary in 2009 and as Interim CEO and Company Director in January 2019 and resigned on 30 June 2019. Richard is Chairman of publicly listed environmental plastics company, SECOS Group Ltd (ASX: SES) and is a foundation board member for Melbourne Theatre Company (MTC). Richard has held various executive positions of large private and public companies including Optus Communications Ltd. Richard has an MBA (AGSM), and a Diploma in Financial Markets (SIA)

Company Secretary The Company Secretary is Mr Peter Andrews appointed 18 February 2019. Peter is also an employee of the University of Melbourne.

Principal Activities

The principal activity of the Company during the financial year was the publication of Scholarly books under the Melbourne University Press and Miegunyah Press imprints, along with the journal Meanjin.

Trading Results

The Company recorded a profit of $154,353 for the year ended 31 December 2019 (2018: a profit of $277,137).

4 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

DIRECTORS' REPORT

YEAR ENDED 31 DECEMBER 2019

Dividends/Share Options

The Company is limited by guarantee and does not pay dividends and share options are not available.

Significant Changes in the State of Affairs In the opinion of the Directors, there were no significant changes that occurred in the state of affairs of the Company during the financial year under review.

Likely Developments and Results No information is included on the likely developments in the operations of the Company and the expected results of those operations in future financial years as it is the opinion of the Company and the University of Melbourne, the parent entity, that this information would prejudice the interests of the Company, if included in this report.

Environment Regulation There are no significant environmental regulations under a law of Commonwealth or State Legislation which regulate the Company's operations.

Indemnifying Officer or Auditor

The Company has not, during or since the end of the financial year, in respect of any person who is or has been an officer or auditor of the Company or a related body corporate:

 indemnified or made any relevant agreement for indemnifying against a liability incurred as an officer, including costs and expenses in successfully defending legal proceedings; or

 paid or agreed to pay a premium in respect of a contract insuring against a liability incurred as an officer for the cost or expenses to defend legal proceedings.

Proceedings on Behalf of Company

Melbourne University Publishing Ltd has no current proceedings being held on behalf of the Company.

Subsequent Events

In December 2019, a cluster of cases of an unknown virus was identified in Wuhan, the capital of China’s Hubei province. This resulted in the Chinese Government locking down the province of Hubei to prevent the spread of the disease. In January 2020, the World Health Organisation declared the outbreak a Public Health Emergency of International Concern. Since then, more cases of the virus, known as Novel Coronavirus (COVID-19), have been diagnosed in China and around the world. Public health measures were imposed in Australia preventing Chinese foreign nationals from entering the country. Quarantine measures were also imposed for those that had recently travelled from China. Further measures have been taken by governments within Australia and around the world to limit human physical contact and so the spread and impact of the disease.

At the time of signing the 2019 financial statements, there is a high degree of uncertainty attaching to the operating environment of MUP and the behavior of consumers of MUP products. Nonetheless, MUP has taken steps to ensure it remains able to produce and sell products, and it is expected that it will continue to be able to do so. MUP has also taken measures to reduce expenditures, to restructure production schedules, and to emphasise alternative paths to market, in order to take account of changing consumer behavior and a probable downturn in revenue during the projected period of disruption. MUP is monitoring its business outcomes and relations closely and will be able to constrain expenditure further as required to limit overall negative effects of the virus on the equity of the business.

Meetings of Directors

The number of meetings of the Company’s board of directors and of each board committee held during the year ended 31 December 2019, and the numbers of meetings attended are as shown below.

The number of meetings attended by each director is shown below:

Director Directors Directors DirectorsAudit Audit Special Board Special Board Meetings Directors Meetings Meeting MeetingsCommittee Committee Meetings Attended Director Meeting Eligible to Attended EligibleMeetings to Meetings Eligible to Attended Attend AttendEligible to Attended Attend Prof PeterWarren McPhee Bebbington (Chairman) (Chairman) - appointed 31 3 73 7 Nil Nil 1 1 DrMr AlanNathan Kohler Hollier - resigned 31 May 2012 2 32 3 1 1 Nil Nil MrMs AllanLouise Tait Adler 5 45 7 1 1 Prof Ian Young 4 7 ProfMr Allan Margaret Tait - appointed Abernethy 31 May 2012 3 52 6 Nil Nil 1 1 MsMrs GabrielleEda Ritchie Coyne 5 54 5 Nil Nil 1 1 Dr BronteSandra Adams McComb - resigned 31 December 201 5 53 5 Nil Nil 1 Nil MrProf Laurie John McKenzieMuller (Chairman) - resigned -31 resigned December 31 2 Jan 195 15 1 Nil Nil 1 1 MsMr LaurieLouise Muller Adler - resigned 31 Jan 19 5 15 1 Nil Nil 1 1 MrProf Robert Bob Officer (Bob) - resignedCarr - resigned 30 April 201231 Jan 19 2 12 1 1 1 Nil Nil MsMr BrianGillian Johns Triggs - resigned 31 Jan 19 5 15 1 Nil Nil 1 1 Mr Danny Gorog - resigned 31 Jan 19 1 1 Mr Tony Peake - resigned 31 Jan 19 1 1 Mr Richard Tegoni - resigned 30 Jun 19 3 3

5 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

DIRECTORS' REPORT

YEAR ENDED 31 DECEMBER 2019

Auditor's Independence Declaration The lead auditor's independence declaration for the year ended 31 December 2019 under the Australian Charities and Not-for-profits Commission Act 2002 is set out on page 7.

In accordance with a resolution of the Board

Professor Warren Bebbington Chairman

Dr Nathan Hollier Director

Melbourne Date: 30th July 2020

Auditor-General’s Independence Declaration

To the Directors, Melbourne University Publishing Limited

The Auditor-General’s independence is established by the Constitution Act 1975. The Auditor-General, an independent officer of parliament, is not subject to direction by any person about the way in which his powers and responsibilities are to be exercised. Under the Audit Act 1994, the Auditor-General is the auditor of each public body and for the purposes of conducting an audit has access to all documents and property, and may report to parliament matters which the Auditor-General considers appropriate.

Independence Declaration As auditor for Melbourne University Publishing Limited for the year ended 31 December 2019, I declare that, to the best of my knowledge and belief, there have been: • no contraventions of auditor independence requirements of the Australian Charities and Not-for- profits Commission Act 2012 in relation to the audit. • no contraventions of any applicable code of professional conduct in relation to the audit.

MELBOURNE Charlotte Jeffries 31 July 2020 as delegate for the Auditor-General of Victoria

MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

INCOME AND OTHER COMPREHENSIVE INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2019

Note 2019 2018 $ $ Income from operations Operating Activities: - Sales of Publications 2 2,354,314 2,270,642 - Subsidies for Publications 2 529,277 510,532 - Funds from The University of Melbourne 2 1,250,000 1,250,000 - Funds from The University of Melbourne (Meanjin) 2 120,000 120,000

Non Operating Activities: - Interest Revenue 27,533 27,535 - Interest Expense (3,766) (1,737) - Other revenue 2 243,480 284,832 4,520,838 4,461,804

Expenses from operations Employee Benefits Expense 4 1,326,855 1,435,041 Depreciation Expense 4 53,824 - 1,380,679 1,435,041

Utilities and Administration Expenses Rent Expenses 4 72,854 71,074 Purchase of Minor Equipment 13,057 12,876 Utilities 20,086 30,568 Administrative Consumables 93,744 177,477 Advertising 69,517 86,603 Other Expenses 2,967 3,513 Bad Debt Expense 4 8,481 54 Total Utilities & Administration Expenses 280,706 382,165

Publication Expenses Cost of Goods Sold 967,026 1,017,476 Royalties Expenses 340,956 294,587 Distribution and Sales Commission 498,446 471,060 Advertising and Promotion - Title Related 185,146 143,744 Stock Writedown 295,257 246,907 Advances Writedown 159,861 89,815 Total Publication Expenses 2,446,692 2,263,589

Contracted/Professional Services Audit Fees 4 20,800 28,000 Accounting Fees 4 24,879 24,155 Payments to Directors (including on costs) 3,379 12,500 Other 4 209,350 39,217 Total Contracted/Professional Services 258,408 103,872

4,366,485 4,184,667

Surplus/(Deficit) 154,353 277,137

Other Comprehensive Income - -

Total Comprehensive Income/(loss) 154,353 277,137

The accompanying notes form an integral part of this these financial statements

8 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN: 82 103 214 713

STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2019

Note 2019 2018 $ $ CURRENT ASSETS Cash and Cash Equivalents 5 1,472,813 1,125,590 Trade and Other Receivables 6 400,733 623,039 Inventories 7 333,321 504,007 Other Financial Assets 9 300,000 300,000 Other Assets 8 145,222 221,525 TOTAL CURRENT ASSETS 2,652,089 2,774,161

NON-CURRENT ASSETS Property, Plant and Equipment 10 151,383 - TOTAL NON-CURRENT ASSETS 151,383 -

TOTAL ASSETS 2,803,472 2,774,161

CURRENT LIABILITIES Trade and Other Payables 11 517,770 666,388 Employee Benefits 13 116,192 378,060 Subsidies in Advance 12 464,760 328,610 Loan 14 62,033 - TOTAL CURRENT LIABILITIES 1,160,755 1,373,058

NON CURRENT LIABILITIES Loan 14 91,480 - Employee Benefits 13 12,647 16,866 TOTAL NON CURRENT LIABILITIES 104,127 16,866

TOTAL LIABILITIES 1,264,882 1,389,924

NET ASSETS 1,538,590 1,384,237

EQUITY Contributed Equity 15 3,090,132 3,090,132 Accumulated Losses (1,551,542) (1,705,895) TOTAL EQUITY 1,538,590 1,384,237

The accompanying notes form an integral part of these financial statements.

9 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2019

Contributed Accumulated Equity Losses Total

$ $ $

Balance at 1 January 2018 3,090,132 (1,983,032) 1,107,100

Surplus - 277,137 277,137 Other comprehensive income for the year - - - Total comprehensive income for the year - 277,137 277,137

Balance at 31 December 2018 3,090,132 (1,705,895) 1,384,237

Balance at 1 January 2019 3,090,132 (1,705,895) 1,384,237

Surplus - 154,353 154,353 Other comprehensive income for the year - - - Total comprehensive income for the year - 154,353 154,353

Balance at 31 December 2019 3,090,132 (1,551,542) 1,538,590

The accompanying notes form an integral part of these financial statements

10 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2019

Note 2019 2018 $ $

Cash Flows from Operating Activities Funds Provided by University 2 1,370,000 1,370,000 Receipts from customers (inclusive of GST) 3,326,038 2,587,022 Payments to suppliers (inclusive of GST) (2,971,426) (2,965,216) Payments to employees (1,592,942) (1,367,979) Interest received 27,533 27,535 Interest paid (3,766) (1,737) Other Income 2 243,480 284,832 Net cash inflow/(outflow) from operating activities 17 398,917 (65,543)

Cash Flows from Investing Activities Purchase of property, plant and equipment (205,207) - Proceeds from sale of property, plant and equipment - - Net cash inflow/(outflow) from investing activities (205,207) -

Cash Flows from Financing Activities Proceeds from borrowings 209,467 Repayment of borrowings (55,954) - Net cash inflow from financing activities 153,513 -

Net (decrease)/increase in cash held 347,223 (65,543) Cash and cash equivalents at the beginning of the financial year 1,125,590 1,191,133 Cash and cash equivalents at the end of the financial year 5 1,472,813 1,125,590

The accompanying notes form an integral part of these financial statements

11 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

1 Statutory Reporting Requirements

Melbourne University Publishing Limited is a company established by the University of Melbourne. The principal objective of the Company is to publish books over a wide range of subjects. The financial report of Melbourne University Publishing Limited for the year ended 31 December 2019 has been prepared pursuant to the relevant provisions of the Financial Management Act 1994 as well as the Australian Charities and Not-for-profits Commission Act 2012.

The financial report covers Melbourne University Publishing Limited, a not-for-profit company limited by guarantee, incorporated and domiciled in Australia.

The financial report was authorised for issue by the Directors on the date shown on the Directors’ declaration attached to the financial report.

2 Statement of Significant Accounting Policies

The financial report is a general purpose financial report. The financial report is presented in Australian dollars which is the Company's functional currency and rounded to the nearest dollar.

The accounting policies have been consistently applied, unless otherwise stated. The following is a summary of the material accounting policies adopted by the Company in the preparation of the financial report.

(a) Basis of Preparation This general purpose financial report has been prepared in accordance with Australian Accounting Standards, adopted by the Australian Accounting Standards Board (AASB), Financial Management Act 1994 and the Australian Charities and Not-for-profits Commission Act 2012 .

Conformity with IFRS Australian Accounting Standards include Australian equivalents to International Financial Reporting Standards. The financial statements and notes of Melbourne University Publishing Limited have been prepared on a "not-for-profit" basis and the Company has prepared this financial report with reference to the requirements regarding "not-for-profit" as contained in the Australian Accounting Standards. The Company is therefore unable to make a statement of compliance with IFRS.

Historical cost convention These financial statements have been prepared under the historical cost basis.

Critical accounting estimates

In preparing these financial statements, management has made judgements, estimates and assumptions that affect the application of the Company's accounting policies and reported amounts of assets and liabilities, income and expenses, requires the use of certain critical accounting estimates. Specifically this year, management has exercised its judgement in respect of the application of AASB 15, AASB 1058 and AASB 16.

Whether a grant or contract contains sufficiently specific performance obligations, involves significant judgement. Funds from The University of Melbourne is recognised on receipt as there are no specific performance obligations imposed by the University.

Revenue is measured at the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer. Revenue from the sale of goods is recognised upon the delivery of the goods to customers. In the assessment of the Company's licensing arrangement with the Licensor, it is not a lease arrangement within the scope of AASB 16 since the Company is not able to derive substantially all of the economic benefits from use of the licensed area. Therefore there is no impact on the Company’s accounting.

(b) Going Concern The company has a net profit of $154,353 for the year (2018: $277,137) and had net cash inflows from operating activities of $398,917 (2018: net cash outflows $65,543), which included $1,370,000 (2018: $1,370,000) in funds provided by the University of Melbourne. The financial report has been prepared on a going concern basis which assumes the realisation of assets and the extinguishment of liabilities in the normal course of business and at the amounts stated in the financial statements.

The directors believe the going concern basis is appropriate due to the ongoing support of the Company's parent entity the University of Melbourne and the board have prepared budgets which demonstrate that, with the continued support of the University of Melbourne, the Company can continue to pay its debts as and when they fall due.

The University has confirmed that it will provide an annual subsidy of $1,000,000 for 2020.

12 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

2 Statement of Significant Accounting Policies (Cont.)

New accounting policies effective for the current reporting period Revenue is measured at the amount of consideration to which the Company expects to be entitled in exchange for transferring promised goods or services to a customer. Amounts disclosed as income are net of rebates, trade allowances and duties and taxes paid. Revenue for the Company is mainly earned from the publication of books. Revenue from the sale of goods is recognised upon the delivery of the goods to customers. Funds from The University of Melbourne is recognised in profit or loss when the entity obtains control of the grant. There are no specific performance obligations imposed by the University. Accordingly, it is recognised on receipt.

The Company's revenue from subscription income is recognised at the end of each quarter as the performance obligations are satisfied at a point-in-time when the customer receives the book.

The Company recognises revenue from rights sales at the point-in-time when it transfers the audio rights, film rights or foreign rights to the customer, as this is the point in time when the performance obligations are satisfied. Royalty revenue is recognised at the point-in-time when the subsequent sales occur.

Interest revenue is recognised using the effective interest method.

Old accounting policies related to prior year

Income is measured at the fair value of the consideration received or receivable. Amounts disclosed as income are net of rebates, trade allowances and duties and taxes paid. Income for the Company is mainly earned from the publication of books. Income from the sale of goods is recognised upon the delivery of the goods to customers, less provision for returns. The Company recognises a liability in the Statement of Financial Position in respect of unspent balances of funds received from funding bodies for the delivery of contracted services on the basis that these services are reciprocal in nature and place an obligation on the Company to repay the funds in the event of the services not being delivered.

Non-reciprocal grant revenue is recognised in profit or loss when the entity obtains control of the grant and it is probable that the economic benefits gained from the grant will flow to the entity and the amount of the grant can be measured reliably. Other revenue comprises royalty, rights and subscription income and is recognised as services are provided.

(d) Financial Instruments

(i) Non-derivative financial assets and financial liabilities – recognition and derecognition The Company initially recognises loans and receivables on the date when they are originated. All other financial assets and financial liabilities are initially recognised on the trade date at which the Company becomes a party to the contractual provisions of the instrument.

The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred, or it neither transfers nor retains substantially all the risks and rewards of ownership and does not retain control over the transferred asset. Any interest in such derecognised financial assets that is created or retained by the Company is recognised as a separate asset or liability.

The Company derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Company has a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

(ii) Non-derivative financial assets - measurement The Company has the following non-derivative financial assets: loans and receivables

Loans and receivables Loans and receivables are financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition loans and receivables are measured at amortised cost using the effective interest method, less any impairment losses.

Loans and receivables comprise cash and cash equivalents and, trade and other receivables.

(iii) Non-derivative financial liabilities - measurement The Company classifies non-derivative financial liabilities into the other financial liabilities category. Such financial liabilities are recognised initially at fair value less any directly attributable transaction costs. Subsequent to initial recognition, these financial liabilities are measured at amortised cost using the effective interest rate method.

Other financial liabilities comprise loans and borrowings and trade and other payables.

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

13 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

2 Statement of Significant Accounting Policies (Cont.) (d) Financial Instruments (Cont.) Trade Receivables

Trade Receivables are recognised at fair value less allowance for expected credit loss (ECL). Trade receivables are non interest bearing and are due for settlement no more than 90 days from date of recognition for trade debtors and no more than 30 days for other debtors.

Trade and Other Payables These amounts represent liabilities for goods and services provided to the Company prior to the end of the financial year, which are unpaid. The amounts are non interest bearing and are unsecured and are usually paid within 30 days of recognition.

(e) Fair Value Estimation

Fair 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 in the principal or in its absence, the most advantageous market to which the Company has access at that date. The fair value of a liability reflects its non-performance risk.

When one is available, the Company measures the fair value of an instrument using the quoted price in an active market for that instrument. A market is regarded as active if transactions for the asset or liability take place with sufficient frequency and volume to provide pricing information on an ongoing basis. If an asset or a liability measured at fair value has a bid and ask price, then the Group measures assets and long positions at a bid price and liabilities and short positions at an ask price.

If there is no quoted price in an active market, then the Company uses valuation techniques that maximise the use of relevant observable inputs and minimise the use of unobservable inputs. The chosen valuation technique incorporates all of the factors that market participants would take into account in pricing a transaction. If an asset or a liability measured at fair value has a bid price and an ask price, the Group measures assets and long positions at a bid price and liabilities and short positions at an ask price. When measuring the fair value of an asset or a liability, the Company uses market observable data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows:

[] Level 1: quoted prices (unadjusted) in active markets for identical assets or liabilities.

[] Level 2: inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).

[] Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs). If the inputs used to measure the fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

(f) Impairment The Company recognises an allowance for expected credit losses (ECLs) for all debt instruments not held at fair value through profit or loss. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Company expects to receive, discounted at an approximation of the original effective interest rate. The expected cash flows will include cash flows from the sale of collateral held or other credit enhancements that are integral to the contractual terms.

ECLs are recognised in two stages. For credit exposures for which there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses that result from default events that are possible within the next 12-months (a 12-month ECL). For those credit exposures for which there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the exposure, irrespective of the timing of the default (a lifetime ECL).

For trade receivables and contract assets, the Company applies a simplified approach in calculating ECLs. Therefore, the Company does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Company has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows.

14 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

2 Statement of Significant Accounting Policies (Cont.)

(g) License License payments under licensing agreement, where substantially all risks and benefits remain with the licensor are charged as expenses in the periods in which they are incurred, on a straight line basis.

(h) Foreign Currency Transactions in foreign currencies are translated to the functional currency of the Company at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies are translated into the functional currency at the exchange rate at the reporting date.

Non-monetary assets and liabilities that are measured at fair value in a foreign currency are translated into the functional currency at the exchange rate when the fair value was determined.

The presentation currency of the Company is the Australian dollar which has also been identified as the functional currency of the Company. Foreign currency transactions during the year are converted to Australian currency at the rates of exchange applicable at the dates of the transactions. Amounts receivable and payable in foreign currencies at balance date are converted at the rates of exchange ruling at that date. The gains and losses from conversion of short- term assets and liabilities, whether realised or unrealised, are included in profit from continuing operations as they arise.

(i) Income Tax

Melbourne University Publishing Limited is exempt from income tax pursuant to section 23(e) of the Income Tax Assessment Act 1936, as amended.

(j) Goods and Services Tax

Receivables and payables in the Statement of Financial Position are shown inclusive of GST. Revenue, expenses and assets are recognised net of GST except where the GST is not recoverable from the Australian Tax Office in which case it is recognised as part of expenses or assets. Cash flows are included in the statement of cash flows on a gross basis and the GST component of cash flows arising from investing and financing activates, which is recoverable from or payable to, the taxation authority are classified as operating cash flows.

(k) In Kind Contribution The Company is provided with insurance cover free of charge by the University of Melbourne under the University's insurance program. A single global policy is held for each type of insurance which covers the University and a number of its Subsidiaries. There is no reliable way of calculating the Company's share of the total premium, as such the Company's share is not disclosed.

(l) Provisions

A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability.

(m) Expenses

Expenses are brought to account when incurred.

15 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

2 Statement of Significant Accounting Policies (Cont.)

(n) New Accounting standards and interpretations

The Company adopted all new and revised standards and interpretations issued by the Australian Accounting Standards Board effective for the current reporting period.

AASB 15 Revenue from Contracts with Customers , AASB 1058 Income of Not-for-Profit Entities and AASB 16 Leases were adopted for the first time from 1 January 2019. The section below provides details on the impact of the application of these standards. There are no other new or revised standards and interpretations adopted materially affecting the reported results or financial position.

Application of AASB 15 Revenue from Contracts with Customers and AASB 1058 Income of Not-for-Profit Entities

AASB 15 Revenue from Contracts with Customers (AASB 15) establishes new principles for reporting the nature, timing, amount and uncertainty of revenue arising from an entity’s contracts with customers. The core principle of AASB 15 is, an entity recognises revenue when control of the goods or services transfers to the customer for an amount that reflects the consideration the entity expects to be entitled in exchange for those goods or services.

AASB 1058 Income of Not-for-Profit Entities (AASB 1058) clarifies the income recognition requirements that apply to Not- for-Profit (NFP) entities. The standard replaces all the income recognition requirements relating to private sector NFP entities, and the majority of income recognition requirements relating to public sector NFP entities, previously prescribed by AASB 1004 Contributions.

There was no change in the Company's recognition of revenue from funds from University of Melbourne. There are no specific performance obligations imposed by the University. Accordingly, income is recognised on receipt in accordance with AASB 1058.

The Company's revenue recognition of publication sales to customers were unaffected as the performance obligations are satisfied at a point-in-time when the customer receives the publication/book. Revenue from the publication sales continue to be recognised when the customer receives the books. Similarly, there was no change in the Company's recognition of revenue from subscription income as the performance obligations are satisfied at a point-in-time when the customer receives the book. Accordingly, revenue is recognised at the end of each quarter.

There was no change in the Company's recognition of revenue from rights sales and royalty, as the performance obligation are satisfied at a point-in-time when the customer receives the audio rights, film rights or foreign rights.

The Company's revenue recognition of interest income, and foreign exchange gains/ (losses) was unaffected as these items are excluded from the scope of AASB 15 and 1058.

(i) Disaggregation of revenue and income

The company derives revenue and income from 2019 $ - Sales of Publications 2,354,314 - Subsidies for Publications 529,277 - Funds from The University of Melbourne 1,250,000 - Funds from The University of Melbourne (Meanjin) 120,000 - Other revenue 243,480 Total income/ revenue 4,497,071 - Total Revenue from contracts with customers 2,597,794 - Total income of not-for-profit entities 1,899,277 Total income/ revenue 4,497,071

(ii) Other revenue 2019 $ - Rights revenue 116,772 - Royalty revenue 15,496 - Meanjin Subscriptions revenue 110,449 - Other revenue 763 243,480

Application of AASB 16 Leases

AASB 16 Leases sets out the principles for the recognition, measurement, presentation and disclosure of leases for both lessees and lessors. AASB 16 introduces a single accounting model for lessees that results in recognition of a right-of- use asset and lease liability for all leases, except short-term leases and low value assets. Lessors continue to classify leases as either operating leases or finance leases.

In the assessment of the Company's licensing arrangement with the Licensor, it is not a lease arrangement within the scope of AASB 16 since the Company is not able to derive substantially all of the economic benefits from use of the licensed area.

Therefore there is no impact on the Company’s accounting.

16 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 3. Financial Risk Management

The principal areas of risk are:

(a) Market risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. It comprises foreign exchange risk, price risk and interest rate risk.

(i) Interest rate risk

The Company has minimal exposure to interest rate risk. This exposure is limited to cash at bank and term deposits.

The following is a summarised sensitivity analysis of the Company's financial assets subject to interest rate risk. 2019 2018 Cash and cash equivalents (interest bearing) $1,472,463 $1,125,240 Other financial assets $300,000 $300,000 Impact of 1% decrease - on profit ($17,725) ($14,252) - on equity ($17,725) ($14,252)

(ii) Foreign exchange rate risk

The Company's exposure to currency fluctuations is minimal. Sales through international distributors in the United States of America (IPG) and the United Kingdom (Eurospan) represent a small proportion of the Company's total sales. Overseas expenditures are made to offshore printers, other production suppliers, overseas authors and their agents. Overseas expenditure exceeds revenue, thus MUP is a net purchaser of foreign currency. The net expenditure amounted to $22,886 (2018: $35,138). The sensitivity to the Company's financial assets and financial liabilities has not been prepared as the exposure is minimal.

(iii) Price Risk - The Company has nil exposure to price risk as there are no holdings of investments.

(b)Credit risk Credit risk represents the risk that a counter party will default on its contractual obligations resulting in financial losses to the Company.

The Company trades with its distributors under the following payment terms: Penguin Random House Australia; 75 days IPG (United States of America); 90 days Eurospan (United Kingdom); 90 days These trade terms are normal for the industry.

Under the distribution contract with Penguin Random House Australia, the Company carries the credit risk insurance in the event a retailer client of the Company goes into administration.

Credit Risk Exposures

The Company’s maximum exposures to credit risk at balance date in relation to each class of recognised financial asset is the carrying amount of those assets as indicated in the Statement of Financial Position and notes to and forming part of the financial statements. Concentrations of credit risk Melbourne University Publishing Limited minimises its credit risk in relation to trade accounts receivable by undertaking transactions with a small number of customers. The majority of its transactions are in Australia and handled through a large multinational publishing company, Penguin Random House Australia. There are no significant concentration risk in respect of the Company's retailer clients. Credit risk in trade receivables is managed by having payment terms of up to 90 days for the Company's Australian distributor, 90 days for overseas distributors and 30 days for direct sale customers in Australia and overseas.

17 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 3. Financial Risk Management (Cont.)

(c) Liquidity risk Liquidity risk is the risk that the company will encounter difficulty in meeting obligations associated with financial liabilities. There is a considerable lead time between the outlay of the costs of publishing a title, including author advances, and the receipt of sale revenue. There is always the risk of returns. However, in the context of the total publishing list, the decision to proceed to publish is a commercial judgement.

Maturity analysis of financial assets and liabilities 2018 1 Year or less Between Between $ 1 to 2 Yrs 2 to 3 Yrs Total Financial Assets Cash and Cash Equivalents 1,125,590 - - 1,125,590 Receivables 623,039 - - 623,039 Other Financial Assets 300,000 - - 300,000 Total Financial Assets 2,048,629 - - 2,048,629

2019 1 Year or less Between Between $ 1 to 2 Yrs 2 to 3 Yrs Total Financial Assets Cash and Cash Equivalents 1,472,813 - - 1,472,813 Receivables 400,733 - - 400,733 Other Financial Assets 300,000 - - 300,000 Total Financial Assets 2,173,546 - - 2,173,546

2018 1 Year or less Between Between $ 1 to 2 Yrs 2 to 3 Yrs Total Financial Liabilities Trade and other Payables 666,388 - - 666,388 Total Financial Liabilities 666,388 - - 666,388

2019 1 Year or less Between Between $ 1 to 2 Yrs 2 to 4 Yrs Total Financial Liabilities Trade and other Payables 517,770 - - 517,770 Loan 62,033 30,493 60,987 153,513 Total Financial Liabilities 579,803 30,493 60,987 671,283

The above financial assets and liabilities are carried at amortised cost and their carrying value approximates their fair values given their short-term nature.

18 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 2019 2018 Note $ $ 4 Surplus/(Deficit) from Operations Profit/(loss) from operations has been determined after:

(a) Expenses: Depreciation - Computer and Software 53,824 - Total depreciation charges 53,824 -

Employee benefits expense -Salaries and wages 999,135 1,228,420 -Superannuation - employer contribution 99,234 133,242 -Other payroll related expense 228,486 73,379

Total employment benefits 1,326,855 1,435,041

Movements in Employee benefits: - annual leave 71,225 (9,634) - long service leave 194,862 (57,428) Total movements in employee benefits 266,087 (67,062)

Rental expense 72,854 86,283

Bad debts expense - trade receivables 8,481 54

Total bad debts expense 8,481 54

Movements in provisions: - write down of advances (70,046) 64,552 Total movements in provisions (70,046) 64,552

Remuneration of consultants/advisors: Other 209,350 39,217 The University of Melbourne (Accounting Services) 24,879 24,155 Total remuneration of consultants/advisors 234,229 63,372

Remuneration of auditors -Audit services Victorian Auditor-General 20,800 28,000 Total audit services 20,800 28,000

5 Cash and Cash Equivalents Cash at bank 1,472,463 1,125,240 Petty Cash (non-interest bearing) 350 350 Cash and Cash Equivalents in the statement of cash flows 1,472,813 1,125,590

6 Trade and Other Receivables Trade receivables are non-interest bearing and are generally on 30-90 day terms. A provision for impairment loss is recognised when there is objective evidence that an individual trade receivable is impaired.

Trade receivables 400,733 623,039 400,733 623,039

Trade Receivables Days past due 31-December-2019 Current <30 days 30-60 days 61-90 days >91 days Total $000 $000 $000 $000 $000 $000 Expected credit loss rate 0.50% 0.50% 0.85% 0.50% 0.50% Estimated total gross carrying amount at default 87 119 113 5 77 401 Expected credit loss 0 1 1 0 0 2

19 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 2019 2018 $ $ 7 Inventories Stock on Hand 266,936 425,814 Work in Progress 66,385 78,193 333,321 504,007 Write downs of inventory that occurred during the year amounted to $295,257 (2018: $246,907) 8 Other Assets Author Advances 139,000 215,484 Prepayments 6,222 6,041 145,222 221,525

9 Other Financial Assets

Current Term Deposit 300,000 300,000 Total 300,000 300,000

10 Property, Plant and Equipment Licenced Property Improvements (at cost) 306,177 306,177 Less Accumulated amortisation 306,177 306,177 - -

Plant & Equipment (at cost) 42,284 42,284 Less Accumulated depreciation 42,284 42,284 - -

Office Furniture and Equipment (at cost) 35,245 35,245 Less Accumulated depreciation 35,245 35,245 - -

Computer and Software (at cost) 205,207 - Less Accumulated depreciation 53,824 - 151,383 -

Total Property, Plant and Equipment 151,383 -

(a) Movements in Carrying Amounts

Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year: Licenced Plant & Office Motor Vehicles Computer 2019 Property Equipment Furniture & and Total Improvements Equipment Software $ $ $ $ $ $ Carrying amount at 1 January 2019 ------Additions - - - - 205,207 205,207 Disposals ------Depreciation/amortisation expense - - - - (53,824) (53,824) Carrying amount at 31 December 2019 - - - - 151,383 151,383

Licenced Plant & Office Motor Vehicles Computer 2018 Property Equipment Furniture & and Totals Improvements Equipment Software $ $ $ $ $ $ Carrying amount at 1 January 2018 ------Additions ------Disposals ------Depreciation/amortisation expense ------Carrying amount at 31 December 2018 ------

20 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 2019 2018 $ $ 11 Trade and Other Payables

Current Payables Trade payables 148,637 332,210 Royalties payables 305,260 235,335 GST and FBT 16,073 32,933 Accruals 47,800 65,910 517,770 666,388

12 Subsidies in advance

Income in advance 464,760 328,610 464,760 328,610

13 Employee Benefits

Current Employee Benefits Annual Leave 55,685 126,910

Long Service Leave 60,507 251,150 Total Current 116,192 378,060

Non Current Employee Benefits Long Service Leave 12,647 16,866 Total Non-Current 12,647 16,866

Aggregate Carrying Amount Current 116,192 378,060 Non-current 12,647 16,866 Total Employee Benefits 128,839 394,926

Average employee numbers during the reporting period 8.9 9.8

14 Loans

Short Term Loan - BOQ Finance (Aust) Limited * 62,033 - 62,033 -

Long Term Loan - BOQ Finance (Aust) Limited * 91,480 - 91,480 - *Loan from BOQ Finance (Aust) Limited for Oracle ERP system and implementation service

15 Contributed equity 2019 2018 $ $ 3,090,132 3,090,132

On 1 January 2003, the net assets of Melbourne University Publishing (a department of the University of Melbourne) were transferred to Melbourne University Publishing Limited. The net assets of the Company on 1 January 2003 were as follows:

Assets Cash and Cash Equivalents 1,436,154 Inventory 510,862 Accounts receivable 410,722 Other financial assets 1,749,582 Other current assets 5,233 Property, plant and equipment 47,986 Total assets 4,160,539

Less Liabilities Accounts payable 927,687 Subsidies in advance 41,280 Provision 101,440 Total liabilities 1,070,407 Net assets 3,090,132 The Company deemed the value of the capital contributed by the University of Melbourne as equal to the value of the net assets provided.

In the event of winding up or dissolution of the Company, the Company’s constitution states that if after satisfaction of all its debts and liabilities there remains any property, the same must not be paid to or distributed amongst the members of the Company, but must be transferred to the University of Melbourne in its capacity as a ‘public education institution’.

As at 31 December 2019, the Company had one member being the University of Melbourne (2018: 1). If the Company is wound up, the constitution states that each member is required to contribute a maximum of $100 towards meeting any outstanding obligations of the Company.

21 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 16 Related Party Disclosure

(a) Directors (i) The names of the persons who were directors of Melbourne University Publishing Ltd during the financial year were:

Prof Warren Bebbington (Chairman) Dr Nathan Hollier (CEO and Publisher) Mr Allan Tait Prof Ian Young Prof Margaret Abernethy Ms Gabrielle Coyne Dr Sandra McComb Ms Louise Adler (CEO and Publisher) - resigned Mr Daniel Gorog - resigned Mr Tony Peake - resigned Mr Bob Carr - resigned Ms Gillian Triggs - resigned Mr Laurie Muller (Chairman) - resigned Mr Richard Tegoni - resigned

Income received or due and receivable by the directors (excluding the CEO) of the Company, including amounts received, or due and receivable from related corporations. 2019 2018 $ $

Received or receivable by directors 33,391 12,500

Number of directors whose remuneration is within the following nil 10 8 $1 - $9,999 1 - $10,000-$19,999 0 1 $20,000-$29,999 0 0 $30,000-$39,999 1 0

Amounts of a prescribed benefit given during the year by the parent entity or a related party to director or a prescribed superannuation fund in connection with the retirement from a prescribed office: Nil Nil There were no other transactions with directors, or other related parties of a director during the year.

(b) Minister

The Responsible Minister was The Hon Gayle Tierney, Minister for Training and Skills and Minister of Higher Education. Ministers remuneration is now disclosed in the Department of Parliamentary Services.

Mr Allan Tait is a director and is employed by the ultimate parent entity The University of Melbourne.

(d) Executive Officers Remuneration The remuneration received or receivable by the Accountable officer during the period was in the range of $200,000 to $210,000 (2018 - $330,000 to $340,000) Income received or due and receivable by executive officers (including the CEO) of the Company as key management personnel:

2019 2018 $ $ Short term benefits 656,924 686,568 Post employment benefits 44,428 86,750 Other long term benefits - - Total 701,352 773,318

Total number of executives 5 5 Total annualised employee equivalent (AEE) 5 5

(e) Related Party Transactions Other transactions and loans have been considered in terms of the disclosure requirements specified under the directions of the Assistant Treasuer and there are no matters other than those listed to report. 2019 2018 $ $ Income received from The University of Melbourne - Non-title Subsidy 1,250,000 1,250,000 Income received from The University of Melbourne for Meanjin 120,000 120,000 Income received from the Russell & Mab Grimwade Miegunyah Fund 529,277 510,532 Expenditure paid to The University of Melbourne 24,879 24,155 Amount payable to The University of Melbourne 87,851 245,444 Subsidies in advance from The University of Melbourne 125,000 105,455

(f) Ultimate Parent Entity The ultimate parent entity is The University of Melbourne.

22 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 17 Reconciliation of Cash Flows from Operating Activities with Net Profit (Loss) 2019 2018

Surplus from operations 154,353 277,137

Non-cash flows in profit/(loss) from operations Depreciation and amortisation 53,824 -

Changes in Assets and Liabilities (Increase)/decrease in receivables 222,306 (189,516) (Increase)/decrease in inventories 170,686 27,086 (Increase)/decrease in other assets 76,303 (41,513) (Increase)/decrease in payables (148,618) (124,129) (Increase)/decrease in employee benefits provisions (266,087) 67,062 (Increase)/decrease in subsidies in advance 136,150 (81,670)

Net cash inflow/(outflow) from Operating Activities 398,917 (65,543)

18 Commitments

(a) Licence Non-cancellable licence agreement but not capitalised in the financial statements;

2019 2018 $ $ Payable: -no later than 1 year 82,543 80,139 -later than 1 year but no later than 5 years 157,632 240,175 Total (inclusive of GST) 240,175 320,314 less GST recoverable from the Australian Tax Office 21,834 29,119 Total (exclusive of GST) 218,341 291,195

(b) Author Advances

The Company has the following commitments to authors for advances on royalties on the production, completion and acceptance of manuscripts: Payable: -no later than 1 year 16,000 169,484 -later than 1 year but no later 5 years 41,000 46,000 Total 57,000 215,484

19 Capital Commitments

The Company did not have any commitments for the acquisition of plant and equipment contracted for at the reporting date (2018: $nil).

20 Superannuation Commitments

The Company's employees are members of a range of superannuation funds run through the University of Melbourne. The funds are divided into the following categories: (i) Those operative and open to membership: -UniSuper (comprising the merged SSAU - Superannuation Scheme for Australian Universities and TESS - Tertiary Education Superannuation Scheme )

(ii) State Government Schemes closed to future membership by Company employees: -State Employees Retirement Benefits Scheme -State Superannuation Fund

Some Company employees receive superannuation benefits through the Superannuation Guarantee Scheme.

UniSuper Plans: UniSuper is a multi-employer superannuation fund operated by UniSuper Limited as the Corporate Trustee and administered by UniSuper Management Pty Ltd, a wholly owned subsidiary of UniSuper Limited. The operations of UniSuper are regulated by the Superannuation Industry (Supervision) Act 1993.

(i) UniSuper offers eligible members the choice of two schemes known as the Defined Benefit Division (DBD) or Accumulation Super (2). The contribution rate to the schemes is 21% of member’s salary, of which the member contributes 7% and the Company 14%. Members can elect to reduce the level of member contributions with corresponding reductions in benefits.

Both the Defined Benefit Division and the Accumulation Super (2) schemes are Defined Contribution Plans for the purposes of AASB119 Employee Benefits.

(ii) UniSuper also offers a cash accumulation productivity scheme known as Accumulation Super (1) (previously referred to as the Award Plus Plan (APP)). Company employees have no requirement to contribute to the scheme. The Company contributes the equivalent of 3% of base salary in respect of those employees who were members of the Defined Benefit Division or the Accumulation Super (2) Plan. Employees who do not qualify for membership of Defined Benefit Division or Accumulation Super (2) will have a minimum contribution of 9.50% of their annual salary contributed by the University to Accumulation Super (1) prescribed under the Superannuation Guarantee Charge Act 1992. Casual and non-permanent employees, who do not qualify for membership of the Defined Benefit Division or Accumulation Super (2), are eligible for Accumulation Super (1).

21 Company Details

The registered office of Melbourne University Publishing Limited is: Level 1, 715 Swanston Street Carlton Vic 3053

22 Events Subsequent to Reporting Date

Novel Coronavirus (COVID-19)

Public health measures were imposed in Australia preventing Chinese foreign nationals from entering the country. Quarantine measures were also imposed for those that had recently traveled from China. Further measures have been taken by governments within Australia and around the world to limit human physical contact and so the spread and impact of the disease.

23 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019 At the time of signing the 2019 financial statements, there is a high degree of uncertainty attaching to the operating environment of MUP and the behavior of consumers of MUP products. Nonetheless, MUP has taken steps to ensure it remains able to produce and sell products, and it is expected that it will continue to be able to do so. MUP has also taken measures to reduce expenditures, to restructure production schedules, and to emphasise alternative paths to market, in order to take account of changing consumer behavior and a probable downturn in revenue during the projected period of disruption. MUP is monitoring its business outcomes and relations closely and will be able to constrain expenditure further as required to limit overall negative effects of the virus on the equity of the business.

23 Economic Dependency The Company is dependent on The University of Melbourne for financial support.

24 Contingent Liability There are no contingent liabilities presently impacting the Company as at the date of this report (2018: $nil).

24 MELBOURNE UNIVERSITY PUBLISHING LIMITED ABN 82 103 214 713

Directors' Declaration

The directors of the Company declare that:

1. In the directors' opinion, the financial statements and notes of Melbourne University Publishing Limited as set out on pages 7 to 22 are in accordance with the Australian Charities and Not-for-profit Commission Act 2012 , including a) giving a true and fair value of the Company's financial position as at 31 December 2019 and of their financial performance for the year ended on that date; and b) complying with Australian Accounting Standards and Australian Charities and Not-for-profit Commission Regulation 2013.

2. In the directors' opinion, as at the date of this declaration, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

3. In the directors' opinion, the attached financial statements of the Company have been prepared in accordance with the Financial Management Act 1994.

4. we are not aware of any circumstances which would render any particulars including in the financial statements to be misleading or inaccurate.

This declaration is made in accordance with a resolution of the Board of Directors.

In accordance with a resolution of the Board

Professor Warren Bebbington Chairman

Dr Nathan Hollier Director

Melbourne Date: 30th July 2020

Independent Auditor’s Report

To the Directors of Melbourne University Publishing Limited

Opinion I have audited the financial report of Melbourne University Publishing Limited (the company) which comprises the:

• statement of financial position as at 31 December 2019 • income and other comprehensive income statement for the year then ended • statement of changes in equity for the year then ended • statement of cash flows for the year then ended • notes to the financial statements, including significant accounting policies • Director's Declaration. In my opinion the financial report is in accordance with Part 7 of the Financial Management Act 1994 and Division 60 of the Australian Charities and Not-for-profits Commission Act 2012, including:

• giving a true and fair view of the financial position of the company as at 31 December 2019 and of its financial performance and its cash flows for the year then ended • complying with Australian Accounting Standards and Division 60 of the Australian Charities and Not-for-profits Commission Regulations 2013.

Basis for I have conducted my audit in accordance with the Audit Act 1994 which incorporates the Opinion Australian Auditing Standards. I further describe my responsibilities under that Act and those standards in the Auditor’s Responsibilities for the Audit of the Financial Report section of my report. My independence is established by the Constitution Act 1975. My staff and I are independent of the company in accordance with the auditor independence requirements of the Australian Charities and Not-for-profits Commission Act 2012 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to my audit of the financial report in Australia. My staff and I have also fulfilled our other ethical responsibilities in accordance with the Code. I confirm that the independence declaration required by the Australian Charities and Not-for- profits Commission Act 2012, which has been given to the Directors of the company, would be in the same terms if given to the Directors as at the time of this auditor's report. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion.

Emphasis of I draw attention to Note 22 of the financial report, which describes the effects of the COVID-19 Matter - pandemic as a material subsequent event. My opinion is not modified with respect to this subsequent matter. events COVID- 19 pandemic

Directors' The Directors of the company are responsible for the preparation of a financial report that gives responsibilities a true and fair view in accordance with Australian Accounting Standards, the Financial for the Management Act 1994 and the Australian Charities and Not-for-profits Commission Act 2012, financial report and for such internal control as the Directors determine is necessary to enable the preparation of a financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error. In preparing the financial report, the Directors are responsible for assessing the company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless it is inappropriate to do so.

Auditor’s As required by the Audit Act 1994, my responsibility is to express an opinion on the financial responsibilities report based on the audit. My objectives for the audit are to obtain reasonable assurance about for the audit of whether the financial report as a whole is free from material misstatement, whether due to the financial fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is report a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with the Australian Auditing Standards, I exercise professional judgement and maintain professional scepticism throughout the audit. I also:

• identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. • obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control • evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Directors • conclude on the appropriateness of the Directors' use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the company’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 report or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the company to cease to continue as a going concern. • evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.

Auditor’s I communicate with the Directors regarding, among other matters, the planned scope and timing responsibilities of the audit and significant audit findings, including any significant deficiencies in internal control for the audit of that I identify during my audit. the financial I also provide the Directors with a statement that I have complied with relevant ethical report requirements regarding independence, and to communicate with them all relationships and (continued) other matters that may reasonably be thought to bear on my independence, and where applicable, related safeguards.

MELBOURNE Charlotte Jeffries 31 July 2020 as delegate for the Auditor-General of Victoria