ANNUAL REPORT
2013 OUR VISION
Leading the way in education and training to inspire success and transform lives.
OUR PURPOSE
Chisholm Institute excels in education and training and is respected and valued for enhancing the social and economic futures of individuals, industry and communities.
OUR VALUES
• Making a difference through learning • Integrity and respect • Excellence • Service and relevance • Diversity • Sustainable practices.
Cover Art: Incorporates ‘The Pipe’ • Cert IV in Photo Imaging Graduate 2013 • Jennifere Thompson Welcome
About this report 4
About Chisholm 5
Board Chair’s message 6
CEO’s message 7
Student highlights 8
Partnership highlights 12
Teaching highlights 14
People and development reports 17
Statistical overview 18
Board and committees 20
Executive team 22
Corporate governance 23
Risk management compliance attestation 28
Social responsibility 29
Financial and compliance information 31
Financial overview 32
Chisholm Institute financial reports and performance 38 statements Caroline Chisholm Education Foundation financial report 89
Activity table 103
Financial performance against budget 105
Disclosures index and additional compliance reports 106
Acronyms 127
Chisholm Institute Annual Report 2013 3 About this report
The Chisholm Institute (Chisholm) 2013 Annual Report is a report to the Parliament of Victoria required under Section 45 of the Financial Management Act 1994. The report contains a report on the operations of Chisholm during 2013, audited standard financial and performance statements and other information required under Standing Directions of the Minister for Finance under the Act (Section 4 Financial Management Reporting) and the Financial Reporting Directions given under that Act.
In the preparation of this report Chisholm has followed the reporting guidelines issued by the Higher Education and Skills Group, Department of Education and Early Childhood Development. This report is based on the model Annual Report issued with these guidelines, in accordance with the Financial Management Act 1994, Australian Accounting Standards, Statement of Accounting concepts, authoritative pronouncements of the Australian Accounting Standards Board and other legislative requirements.
This report also includes details of the operations of the Caroline Chisholm Education Foundation and an audited financial report for the Foundation. The Caroline Chisholm Education Foundation is a controlled entity of the Chisholm Institute Board.
All financial information presented in this report is consistent with the audited financial report for Chisholm Institute and the Caroline Chisholm Education Foundation.
Queries in relation to this report can be addressed to: The Chief Operating Officer Chisholm Institute PO Box 684 Dandenong Vic 3175 E: [email protected]
Further information about Chisholm can be obtained at www.chisholm.edu.au.
Maria Peters Chief Executive Officer
26 February 2014
Grant Radford Chief Finance and Accounting Officer
26 February 2014
4 Chisholm Institute Annual Report 2013 About Chisholm
Chisholm’s vision is to lead the way in education and training, to inspire success and to transform people’s lives. The values by which the Institute stands include making a difference through learning; integrity and respect; excellence; service and relevance; diversity; and sustainable practices.
Chisholm is a Victorian Government institute of technical and further education established under the Education and Training Reform Act 2006. The responsible Minister is the Hon. Peter Hall MLC, sworn in as Minister for Higher Education and Skills. Chisholm was named in 1998 in honour of Caroline Chisholm, the early Australian reformer and humanitarian.
In 2013 the Institute continued its response to major changes in the sector, successfully moving to a more customer-centric business model, streamlining processes and expanding pathways to develop more opportunities for students.
Chisholm is multi-sectoral, delivering a broad range of education and training programs and services in higher education, VET and school sectors across its campuses, online, in the workplace and overseas with partner educational and government organisations.
Currently, Chisholm offers certificate, diploma, advanced diploma and graduate certificate courses, short courses and degree programs. There are plans to deliver a Master of Business Administration in partnership with Chifley Business School in 2014.
The Institute serves one of the state’s most culturally diverse and fastest growing regions in south east Victoria, with modern training facilities in Bass Coast, Berwick, Cranbourne, Dandenong, Frankston and Mornington Peninsula.
Chisholm is a proud public institute that has as its purpose to excel in education and training and be respected and valued for enhancing the social and economic futures of individuals, industry and communities.
Chisholm Institute Annual Report 2013 5 Board Chair’s message
It is my pleasure to present the Chisholm Institute Annual Report for Our international projects continued in 2013, my first as a member of the Board and as Chair. 2013, with major contracts for clients Qatar Petroleum, Fujian Electric Power College I am pleased to report that Chisholm went from strength to and AusAid, among others. Locally we also strength in 2013 despite the many issues we faced in a challenging continued to work with key industry clients on a wide range of environment, which included a significant reduction in government projects that reflect our scope of operations. funding and increasing competition. Importantly, we ended 2013 in a strong financial position, having The actions taken by the CEO and the previous Board during met all our key performance indicators and with a strong plan for the the year, endorsed and supported by the new Chisholm Board, future. established a framework that has enabled our Institute to survive and prosper. While many of these decisions were difficult, they The Board would not have had such a positive first year were it not created a strong organisation and will stand us in good stead for the for the strong support received from the whole Chisholm community. future. Restructuring of the organisation is now largely complete, but will continue to be fine-tuned as required to deal with changing Firstly, I would like to thank the outgoing Board members for their circumstances. hard work, and the new and continuing Board members (including the former Board Chair, David Willersdorf) for the valuable experience and This year, we implemented important constitutional amendments insights they bring to our Board. that impacted on the operations of both the Board and the Institute. This involved a change in Board membership. I was very pleased to be On behalf of the Board, I would like to thank our CEO, Maria Peters, appointed to the Board and named Chair of the Board of Chisholm in for her outstanding leadership during a difficult time. We are April 2013. I joined with the members of the new Board to oversee very fortunate to have a CEO of Maria’s calibre and we very much Chisholm’s evolution into an efficient and effective organisation that appreciate her professionalism, enthusiasm and commitment. is flexible and responsive, both to client requirements and to business opportunities. Each Board member brings with them significant I would like to thank the Executive Directors, who I have had the expertise in terms of their own professional knowledge and pleasure of working closely with throughout the last nine months. experience, and all share a passion for the future of Chisholm. They have carried out their tasks professionally, capably and enthusiastically in a time of flux. The Board’s strategy for the Institute – Chisholm 2020 – continues to outline our vision, which is to be the Institute of Choice, Partner of Thanks also to our managers and staff, the lifeblood of Chisholm, Choice and Workplace of Choice. This document guides our long term who have worked tirelessly to ensure that we continue to be strategic direction to ensure our future success and sustainability. recognised as one of the premier tertiary education facilities in During 2013, the new Board reviewed this strategy and made Victoria. Their efforts are greatly appreciated. adjustments to a number of Chisholm 2020 supporting strategies And finally to our students, without whom Chisholm would not exist to suit the new fiscal climate and streamline the implementation of – thank you for choosing Chisholm as your preferred place of learning. government requirements. I trust that you will continue to enjoy your experiences at Chisholm As a Board, we also maintained a strong focus on governance and graduate with fond memories of your time with us. responsibilities in 2013 to ensure that we remain capable of meeting the challenges and demands faced in the changing marketplace, and continue to be recognised nationally and internationally as a quality education and training provider. Stephen G. Marks In terms of strategic direction, we again expanded our higher Board Chair education offerings this year, establishing and strengthening 26 February 2014 partnerships and developing courses – in consultation with industry – that result in defined pathways for our students from certificate through to degree levels. This will be extended again next year when we offer an MBA, in partnership with Chifley Business School.
6 Chisholm Institute Annual Report 2013 CEO’s message
2013 was a year of transition, one in which we refocused the Attracting, keeping and re-engaging organisation after a major restructure and adjusted to the policy students are key foci for us. In line with our changes experienced by the whole VET sector. commitment to put our customers first, we embarked on a major engagement project The year began with new delivery arrangements, new campuses for to centralise communications and provide a seamless, customer- some staff and new managers, all of which meant that we had to focused approach to our enrolments. During the latter half of 2013 make significant adjustments at the busiest time of the year. We had we implemented some key work that will continue into 2014. new policies to implement and many changes to make as a result of the revised government funding arrangements. I was very heartened We developed new products and broadened our existing products by the way our organisation came together and sought to re-invent through expanding our blended, online and work based delivery and respond to an environment that is significantly different from options and resources across a wide range of courses to increase that of our past. flexibility and responsiveness to meet student, employer and other client expectations. Chisholm embraced the new climate and challenges and had a successful year, with much good news to celebrate. We met our Building our partnerships and relationships with industry and other training delivery and financial sustainability objectives and the whole external organisations continues to be critical to our future. We Institute gained momentum as we went along. worked throughout 2013 with our partners on a large number of national and international projects that showcase our expertise and As a snapshot, our highlights for 2013 included: meet client needs. There are plans to grow these business areas into 2014 and beyond. • commencing construction of the Berwick Trade Careers Centre and the START Ttade Training Centre at Frankston As an organisation, our long term directions are now set. We can take • building and strengthening our industry partnerships with lessons and pride from our achievements this year, and use this as a organisations such as Qatar Petroleum, Jewish Care Victoria, foundation for a strong and successful future. Doutta Galla, BUPA, IVECO, South East Water and Peninsula Health A new Chisholm Board was constituted in 2013. I wish to recognise the outgoing Board Chair, David Willersdorf, and the previous Board • implementing Chisholm Stars, our employee recognition and members for their work and contribution to Chisholm. I would also reward program for excellence, innovation and leadership, with like to acknowledge the expertise, commitment and leadership of five teams and 74 individuals nominated for awards the new Board Chair, Stephen Marks, and thank the new Board for • implementing the technology for and launching the new their strong guidance and support in a challenging year. Chisholm Technology Enabled Learning Centres (TELCs) in partnership is fortunate to have a Board that understands its responsibilities, with GippsTAFE and Advance TAFE; 20 centres are set to and has strong expertise and strategic leadership that it exercises operate in 2014, delivering benefits to our students and in a way that is clearly advantageous to the Institute. Most of all, I communities sincerely thank our executives, managers and staff for their loyalty, commitment, hard work and professionalism in creating a positive and • providing 174 scholarships to our students in need through the dynamic environment in which Chisholm can thrive. Caroline Chisholm Education Foundation
• making improvements to our student management system, Together, our goal is to grow Chisholm: allocating our resources, course information system, human resources systems and raising and diversifying revenues, and providing a customer-centred processes, Quality Management System and Business Client service to all our clients. I am proud of what we have achieved in a Relationship Management System. tough climate. I think we can close 2013 feeling good about the Chisholm brand and chart our way confidently through 2014. This year our students received some significant recognition, being finalists and award winners in welding, fabrication, hair, beauty and IT, as well as WorldSkills involvement and success. We also celebrated our ABC Women in Broadcast Technology scholarship winner.
We were very proud to congratulate our first Bachelor of Community Health, Mental Health and Alcohol and Other Drugs degree students Maria Peters on their graduation, as well as the first graduates from the Chisholm Chief Executive Officer and La Trobe accounting degree partnership. 26 February 2014
Chisholm Institute Annual Report 2013 7 2013 student highlights
ABC scholarship win Certificate IV in Electronics and Communications student Helen Talbot was awarded a 2013 ABC Women in Broadcast Technology Scholarship in a nationwide competition this year.
The scholarships provide career opportunities for Australian women studying electrical engineering, computer systems/shared technology, electronics technology and communications engineering. Successful applicants receive four weeks of paid work in the ABC Technology Division, plus a $1000 educational book allowance.
“Being one of the few women studying electronics and communications, I feel that I could be an excellent example for other women,” said Helen. “My win will show others that this is a viable and exciting career path for both genders.”
Care leads to a bright future Kiara Haworth was named Youth Enterprise Award nominee at the Greater Dandenong Chamber of Commerce’s Premier Regional Business Awards, recognising the hard work she displayed while pursuing her dream of becoming a nurse.
While studying VCE, Kiara juggled a part time healthcare job and a VET in Schools nursing course through Chisholm, completing additional modules and a work placement to become a patient Chisholm’s Apprentice of the Year, Leigh Hyman. services assistant. Today she is a Diploma of Nursing student at Chisholm, working part time in a care facility. Apprentice of the Year “This is a great career path,” said Kiara. “I’m learning a lot as I go. Chisholm’s Apprentice of the Year, Leigh Hyman, is pleased with her Working in a hospital, I know what to expect from my career – and I decision to enter a career in the automotive industry, with so many truly want to be a nurse.” opportunities to diversify.
As a mature-aged apprentice, Leigh completed the Certificate III in Automotive Technology (Light Vehicle) and at the same time notched up a Certificate II in Air Conditioning, and courses in LPG accreditation, advanced engine management and motorsport suspension.
Currently working at Prostreet Automotive in Frankston, she has just completed a Certificate IV in Automotive Technology and is interested in undertaking a Diploma in Automotive Management.
“I believe education and upskilling is critical,” said Leigh. “I know that my Chisholm qualifications are setting me up for a great career.”
8 Chisholm Institute Annual Report 2013 Representing Australia on the world stage Chisholm IT student and computer whiz Joshua Stevens was one of only three Australians chosen to compete in the world finals of the Adobe international computer software championships this year.
After achieving an almost perfect score in a Dreamweaver examination, Josh won the opportunity to travel to Washington in July for the Microsoft Office Specialist World Championship and the Adobe Certified Associate World Championship. He competed along with 125 top students from 40 countries.
Josh, a third year IT and software development student, hopes that his experience of competing overseas will help him achieve his career goal of becoming a web designer.
International awards honour Chisholm student International student Sarah O’Shea was a VET International Student of the Year finalist in the Victorian International Education Awards 2013.
Sarah, a single mother from war-torn Zimbabwe, is currently in the joint management course at Chisholm. Having successfully National champion panel beater and graduate Dayne completed the Certificate IV in Frontline Management, she is now Ciborowski returned to Chisholm this year to judge studying the Diploma of Management. apprentices competing in the regional round of the WorldSkills Australia program. Sarah constantly helps and inspires others by seeking out new ways to assist disadvantaged youth as well as encouraging fellow students to broaden their experience and become involved in their National champion judges new community. She hopes to continue her studies and enhance her management qualifications. next generation National champion panel beater and graduate Dayne Ciborowski returned to Chisholm this year to judge apprentices competing in the regional round of the WorldSkills Australia program.
Dayne believes that competitions such as this are very worthwhile for competitors. “It’s definitely something to put on your resume and employers really value the title.”
He said representing Australia at the 2013 WorldSkills International Championship in Leipzig was a great opportunity.
“Going to Germany for WorldSkills was full on, intimidating and exciting. It improved my time management and really sharpened and honed my skills. The intensive training made me a lot more confident.”
Chisholm Institute Annual Report 2013 9 2013 student highlights
Beauty students clean up at industry awards night Chisholm celebrated another success by winning big at this year’s annual Hair and Beauty Industry Association Awards.
The winners and their categories were Jade Chester (Certificate III in Hairdressing), Lisa Arena (Certificate III in Beauty Services) and Stephanie De Martin (Diploma of Beauty Therapy). These exceptional students were nominated for their proven skill and extraordinary commitment to their training, both at Chisholm and within industry.
“Teachers at Chisholm were helpful, warm and created such a great atmosphere,” Stephanie said. “The theory and practical experience meant that I have a great number of job opportunities. I’m so happy about where my course has taken me.”
Chisholm and La Trobe Bachelor of Accounting students.
First Chisholm and La Trobe accounting graduates The first graduates of the Chisholm and La Trobe Bachelor of Accounting accepted their certificates at the La Trobe University graduation ceremony in December.
Mature age students Angelina Colin, Ann Howes and Chakrya Sarin were all looking for a locally-delivered course that would lead to industry qualification and a new career path.
“Our Chisholm and La Trobe partnership has led to a fast tracked pathway program that provides the best of the private university model with a Chisholm feel,” explained Cathryn Daley, Administrator Accounting Pathways.
Graduates are eligible for membership with CPA Australia, the Stephanie De Martin (Diploma of Beauty Therapy). Institute of Chartered Accountants Australia and the Association of Chartered Certified Accountants.
10 Chisholm Institute Annual Report 2013 CELEBRATING NATIONAL SKILLS WEEK Chisholm Hair and Beauty students and staff shone at the launch of National Skills Week in Melbourne in August.
The team highlighted their abilities in the areas of body painting, special effects make-up, stage, prosthetics and glamour at the launch event.
The VIP attendees including Minister Hall and representatives from Victoria’s vocational education and training sector marvelled at the “Phantom”, the body painted student models and all our Stage make- up displays.
Aarron Ralston’s award winning artwork was exhibited at Ballarat’s Wolveschildren Art Gallery.
Photo imaging transformation Aarron Ralston’s dream to be a photographer and to run his own business is becoming a reality, thanks to a career change and Chisholm’s Certificate IV in Photo Imaging.
In 2012 Aarron was retrenched, with few prospects. Interested in photography, he chose the Chisholm course. Soon opportunities to work on photo shoots and within industry meant more work than he could manage while studying.
Enrolling in a course at Chisholm transformed Aarron’s life. In 2013 he was a winner in the Heritage Hill Art Box competition and had his work exhibited at Ballarat’s Wolveschildren Art Gallery. He has gone on to study for a Diploma of Photo Imaging.
The Phantom Nick Kozakis and student models (from left) Rickel Chow and Chontelle Berryman.
Chisholm Institute Annual Report 2013 11 2013 partnership highlights
Major Victorian Government Chisholm and Jewish Care home and community care partner for education contract Jewish Care Victoria has established a new Employment and Education Centre to deliver nationally accredited courses in This year, Chisholm was awarded a $5.5 million Victorian Government partnership with Chisholm. contract to consult, plan, coordinate, promote and deliver education and training to the entire health and community care (HACC) The first course, starting February 2014, will be the dual qualification workforce across Victoria. in Certificate III in Aged Care and Home and Community Care. The contract, with the Department of Health, has Chisholm The new Centre provides a great opportunity for people to develop organising workforce education and training for paid staff and skills and create pathways to new employment, with work placement volunteers delivering services funded by the HACC program. These and practical assessment occurring within Jewish Care facilities. include supervisors and managers, health assessors, nurses, allied There are also potential employment opportunities and job seeking health professionals, community care workers and volunteers. assistance. “This partnership is a fantastic example of Chisholm’s ability to deliver This partnership is a very positive initiative, providing greater access large-scale training in terms of diversity, efficiencies and distance,” for all members of the community. It will see Chisholm continue said Maria Peters, Chisholm CEO. “We’ve trained almost 1470 people to innovate and be responsive to students interested in health since July, and look forward to continuing this work into 2014.” and community care. The opportunity to study at Jewish Care’s Employment and Education Centre is open to everyone. As part of the project Chisholm also developed a Victorian HACC Education and Training Service website, which includes HACC training calendars, a searchable all-courses database and an online enrolment facility.
Training for Qatar Petroleum In 2013, Chisholm began a four year project to provide Qatar Petroleum with a complete range of onshore and offshore training and educational consultancy services.
The project involves the provision of certification and moderation services for delivery of accredited training programs, training facilities and equipment consultancies.
Services will be provided for a range of qualifications at Certificate I, II, III and IV levels in engineering, business and security, with the contract including provision of administrative systems and processes to support delivery. It also includes technical instructor training in the Certificate IV in Training and Assessment.
Maria Peters, CEO of Chisholm and Bill Appleby, CEO of Jewish Care.
12 Chisholm Institute Annual Report 2013 Technology takes training into the future Chisholm has partnered with Advance and Central Gippsland Institutes to develop the Technology Enabled Learning Centre (TELC) network, which will deliver training through the latest voice, video and interactive technologies.
TELCs are a key recommendation from the Gippsland Tertiary Education Council’s plan for improving education and training in Gippsland. They provide an accessible digital learning platform and are critical in broadening course options and increasing access for students.
Chisholm CEO Maria Peters said that Chisholm was privileged to be a partner in the project.
“We all have a common commitment as TAFE institutes to provide Chisholm apprentice chefs spend time with the educational opportunities to our working partners and communities,” local children in Vanuatu as part of the Australian she said. “For us it’s about taking education out to the community Government’s VET Outbound Mobility Program. through new technology, and providing new learning opportunities for students.”
Cooking, culture and more Expanding the higher Nine Chisholm cookery students stepped outside their comfort zone education offer in November and travelled to Vanuatu to learn more about local With over 100 students, Chisholm’s higher education offering grew cuisine, customs and culture. during 2013 and is set to increase further in the future. Funded by the Australian Government’s VET Outbound Mobility So far, three Chisholm copyrighted degrees have been accredited Program, the students competed for a place on the tour by – the Bachelor of Community Mental Health, Alcohol and Other performance in class and submitting a project on diversity. Drugs, the Bachelor of Interactive Media Design and the Bachelor of Engineering Technology (Mechanical and Manufacturing/ In Vanuatu they worked with local chefs in Port Vila restaurants Mechatronics). They were all developed in conjunction with industry and resorts, visited fresh food markets, toured local villages and, at to ensure their currency and relevance to students’ career paths. the end, cooked a feast (traditional and fusion) to thank their local friends and supporters. Under licence from La Trobe University, the second and third years of the La Trobe Bachelor of Accounting are being delivered. During Students were incredibly positive about their experience. They 2013, Chisholm negotiated an agreement to deliver the Bachelor of learned a lot about diversity and working with other cultures. Information Technology in the same way. They also enjoyed learning about the different ingredients and methodologies used in local cuisine, and are already planning to And in partnership with Deakin University, Chisholm offers the incorporate elements in their cooking at home. Chisholm staff Bachelor of Early Childhood Education, specifically designed to developed valuable partnerships with hospitality businesses, which provide a pathway from advanced diploma through to degree. will lead to increased international opportunities for students in the future.
Chisholm Institute Annual Report 2013 13 TCEA HING HIGHLIGHTS
Automotive & Supply Chain Engineering, Electrotechnology Management & Telecommunications • Secured industry sponsorship from Penrite Oils, Sidchrome, IVECO, • Delivered practical Certificate IV in Engineering and Diploma PPG, Glenmac, Audatex, Dee Beer Paints, I-CAR, BMW, Chrysler of Engineering training to 40 students enrolled in Monash and Toyota University’s Bachelor of Engineering • Hosted WorldSkills Australia regional finals in four categories, • Purchased new industry-standard CNC machines and tensiometer with Chisholm automotive students winning five medals for the polymer testing facility to increase capacity (including two gold) • Introduced an e-Learning option for the whole theory component • Increased industry training with a range of client companies, of the Certificate III in Electrotechnology including PACCAR/Kenworth Trucks, in Victoria and New South • Entered into a contract with an additional college in Fujian, China, Wales for delivery of CEC programs at Fujian Electric Power College • Established a heavy vehicle course in Mongolia • Conducted moderation and validation activities for Chisholm • Implemented an automotive light vehicle online learning program qualifications being offered in Qatar for Qatar Petroleum; for onsite and flexible delivery, planned for 2014 online courses qualifications include engineering, electrical and security in panel and paint and heavy vehicle, and reshaped forklift instrumentation training to include online resources • Established a Warehousing and Logistics Industry Advisory Board Environment & Mornington to advise the department on strategic directions Peninsula Campus • Successfully introduced VCAL programs to the Mornington Building & Construction Peninsula campus, giving over 30 students the opportunity to • Commenced a new delivery strategy for the Certificate III in experience a range of trades Carpentry, increasing onsite training and assessment, with strong • Work commenced on the Southern Mornington Peninsula Trade support from employers and students Training Centre at the Mornington Peninsula campus in Rosebud • Hosted five construction trainers from Ethiopia on a six-week • Established a sponsorship deal with Monsanto for the National visit to model Chisholm training methods Precision Growing Centre, a glasshouse that simulates a perfect growing environment Business Services • Won the 2013 Protected Cropping Australia Industry Training Award for programs delivered at the National Precision Growing • Brokered an agreement with the Chifley Business School for Centre Chisholm to deliver the Chifley Master of Business Administration (MBA) commencing March 2014, the first MBA on offer locally Foundation College • Congratulated the first group of students who graduated from Chisholm’s Bachelor of Accounting course, delivered in • Developed and collaborated with local agencies to provide partnership with La Trobe University a young parents course that continued formal learning and supported the new parents’ experiences and challenges
14 Chisholm Institute Annual Report 2013 Hair, Beauty & Wellness International • Commenced development of a shared delivery model for the • Enrolled the first group of international students in the Chisholm Bachelor of Health Science (Dermal Therapies) with Victoria and La Trobe University Bachelor of Accounting University • Marketed business partner packaged offers with Deakin • Completed construction of an industry-standard spa training University and La Trobe University that meet new government suite that will also operate as a commercial salon in 2014 visa regulations • Hosted the beauty component of WorldSkills Victoria regional • Completed three aid projects for African participants (delivery competitions at Berwick campus in November and showcased in Australia, Mauritius and South Africa) for AusAID with a student work, winning gold (Krystle Harvey), silver (Ella Cross- very positive response, and compiled a bid for project work in Payne) and bronze (Skye Woods) Botswana • Completed several projects in Ethiopia to support training reform Hea lth & Community Care in four trade areas • Pursued project opportunities in Vietnam, working with their • Won a $5.5 million tender to deliver HACC training across Victoria Department of Vocational Training across 26 trade areas on behalf of the Department of Health; by the end of 2013, 1469 learners had participated in the program IT & Computer Systems • Celebrated student achievements, including: Hospitality, Tourism & Bass Coast - Advanced Diploma of Computer Systems Engineering • Continued to provide 80 per cent of Bass Coast students student Sam Billings, who was nominated in the City of with local work experience opportunities, many leading on to Greater Dandenong Chamber of Commerce Youth Enterprise employment Awards • Provided retail skills recognition for workers in all Salvo stores - Advanced Diploma of Information Technology student across Western Australia Robelyn Abano from the Philippines, who received an Australian Government Endeavour Award Scholarship • Gained registration as a certified VM Ware Training Academy, one Intc era tive Media & Design of the very few in Victoria, which allows students to extend their • Trained 20 participants from the City of Greater Dandenong qualifications and improve their employability Young Leaders Program in video and design to enable them to complete a range of community projects • Began the Certificate IV in Photo Imaging with 36 students and Plumbing & Water planned for expansion into a diploma program in 2014 • Established a partnership with South East Water to deliver two short courses – for civil works employees to streamline installation procedures (Water Centre, Berwick) and for plumbers to adhere to company standards (Frankston campus) • Commenced delivery of Certificates III, IV and Diploma of Water Operations on site for Queensland Water employees • Developed the Diploma of Water Operations, the first in Australia, in response to industry demands • Congratulated Jack Murphy on winning Group Training Apprentice of the Year in the 2013 Master Plumbers Training Awards
Chisholm Institute Annual Report 2013 15 TCEA HING HIGHLIGHTS
Senior & Technical College • Implemented the Pascifika course to re-engage young people 16–17 from Pacific Islander communities within the region, with two programs completed over the year • Consolidated all Chisholm senior secondary program (VCE and VCAL) delivery into one business area to improve customer service and pathway options
Teaching & Learning Quality • Launched the TELC program, which complements existing delivery models by providing online interactive learning to students in regional areas • Delivered an education research project in relation to learning via video conferencing methodologies to Minister Hall • Established a partnership and conducted industry programs with Victoria Police, State Emergency Services, Melbourne Water and ADP to deliver the Certificate IV in Training and Assessment
16 Chisholm Institute Annual Report 2013 PEOPLE AND DEVELOPMENT Reports
The People and Development Business Group, comprising Human Workforce data equivalent full time (EFT) staff Resource Management and Occupational Health and Safety, was created following an internal Institute organisation review. A People EFT average staffing 2013 2012 2011 and Development three-year strategic plan and a one-year business comparison operational plan for 2013 were developed for the new Business Executive Officers 7 11 12 Group. Teaching 567 659 683 PACCT 279 369 426 Human Resource Management Others 0 0 0 Key achievements in 2013 included: Total 853 1,039 1,121 • development and implementation of the first wave of employee life cycle management initiatives embracing onboarding, Note: induction, performance management and reward and recognition, The information above represents an average EFT staffing figure creating the platform for development of Chisholm as a high for the 2011, 2012 and 2013 calendar years, i.e. the sum of the performing organisation monthly figures divided by 12. • implementation of an annual award presentation for the Chisholm STARS reward and recognition program, with nominated Public sector employment and staff and teams receiving public recognition in front of their conduct principles peers for the great work undertaken Chisholm’s employment policies and processes are based on the • implementation of management skill development (the People principle of merit, relevant award and statutory requirements, and Leader program) was of great strategic importance and best practice public sector approaches. provided managers with improved capability to address people management issues and better manage financial challenges The Institute’s Code of Conduct, which is reviewed annually, provides • development and implementation of monthly pulse check guidance to all staff on expected behaviour and professional conduct reporting provided the Institute with insight into how staff are and is based on the Institute values, the Victorian Public Sector experiencing changes taking place, allowing for consideration of Model and other best practice examples. Chisholm is committed to strategic responses equal opportunity and fair and transparent processes in all human • implementation of human resources system and reporting resource management procedures. changes that improve manager access to information and enhance human resources data integrity; initiatives implemented General statement on industrial will improve manager decision making and lead to improvements in leave liability management. relations Chisholm continues to have regular consultative arrangements in place with both major unions, the Australian Education Union and National Tertiary Education Union. Chisholm also uses the dispute resolution procedures in its Certified Agreements to ensure issues that may arise are addressed appropriately and in a timely manner.
There were no days lost due to industrial action in 2013.
Chisholm Institute Annual Report 2013 17 Statistical overview
Student enrolments
2013 2012 Government funded accredited programs 15,656 17,826 Fee for service programs 24,199 21,278
(Less) student enrolments in both government accredited programs and fee for (1,737) (1,481) service programs Total net student enrolments 38,118 37,623
Student contact hour delivery
2013 2012 Government funded accredited programs 7,469,096 7,767,502 Fee for service programs 4,447,097 3,216,498 Total student contact hour delivery 11,916,193 10,984,000
Student enrolments by age
Age group 2013 2012 Student Student Per cent Per cent enrolments enrolments Under 15 365 1.0% 312 0.8% 15 to 19 12,097 31.7% 11,038 29.3% 20 to 24 7,848 20.6% 7,395 19.7% 25 to 39 8,594 22.5% 8,973 23.8% 40 to 64 8,916 23.4% 9,577 25.5% 65 plus 296 0.8% 323 0.9% Not stated 2 <0.1% 5 <0.1% Total 38,118 100.0% 37,623 100.0%
Student enrolments by gender
Gender 2013 2012 Student Student Per cent Per cent enrolments enrolments Female 14,640 38.4% 14,590 38.8% Male 23,476 61.6% 23,033 61.2% Not stated 2 <0.1% Total 38,118 100.0% 37,623 100.0%
18 Chisholm Institute Annual Report 2013 Statistical overview
Course enrolments and student contact hours by campus
2013 2012 Campus Student Student Course Course Per cent contact Per cent Per cent contact Per cent enrolments* enrolments* hours hours Dandenong 14,855 24.7% 3,102,326 26.0% 15,468 27.2% 3,317,864 30.2% Frankston 15,283 25.4% 2,952,961 24.8% 14,896 26.2% 3,341,012 30.4% Offshore 6,716 11.2% 1,946,865 16.3% 3,677 6.5% 815,072 7.4% delivery Workplace 13,682 22.7% 1,486,893 12.5% 12,658 22.2% 1,071,322 9.8% Berwick 4,307 7.2% 1,458,526 12.2% 5,102 9.0% 1,455,901 13.3% Cranbourne 1,189 2.0% 317,220 2.7% 2,034 3.6% 442,765 4.0% Mornington 1,751 2.9% 264,476 2.2% 1,216 2.1% 250,754 2.3% Peninsula Online 1,302 2.2% 181,436 1.5% 629 1.1% 58,616 0.5% Bass Coast 755 1.3% 102,810 0.9% 752 1.3% 101,208 0.9% Chisholm 317 0.5% 102,628 0.9% 514 0.9% 129,486 1.2% @ 311 Total 60,157 100.0% 11,916,193 100.0% 56,946 100.0% 10,984,000 100.0%
* Individual students can choose to enrol in multiple campuses. Includes enrolments in Language, Literacy & Numeracy Strategy.
Chisholm Institute Annual Report 2013 19 Board and committees
2013 board DAVID WILLERSDORF Stephen G. Marks David is Group General Manager/Director/Company Secretary for the Board Chair Grenda Corporation Pty Ltd, with over 20 years of experience in this business. He is a member of the Committee for Dandenong, a Fellow Stephen has more than 35 years of experience as a chartered of the Certified Practising Accountants of Australia Association and a accountant, and he has provided specialist independent probity member of the Australian Institute of Management. David’s key areas auditing and advisory services to the public sector for the past of knowledge, skills and experience include financial management, 12 years. In addition to his Institute stewardship responsibilities, accounting and risk management, and statutory and regulatory Stephen is a board member of the St Vincent’s Institute and the compliance. audit committee of Origin Youth Health Research Centre. He is also a member of the Victorian Department of Human ROBERT COMELLI Services Financial Management Advisory Committee and DMP Asset Management Investment Advisory Committee. Stephen’s Robert is currently the CEO of Australian Botanical Products Pty extensive finance and public sector experience provides a solid Ltd. He was previously the CEO of the Association for Accounting platform for the maintenance of the excellent reputation and Technicians (Australia) Ltd. He has a strong commercial finance ongoing sustainability of Chisholm. background, holding senior management and CEO positions in a variety of private sector organisations and directorships in public Todd Hartley and private companies, including Groups with 20 subsidiaries and turnovers of over $500 million. Robert is a Fellow of CPA Australia, Todd is the Managing Director of Hilton Manufacturing, a leading Fellow of the Institute of Public Accountants and Fellow of the manufacturing company in Dandenong South. Todd brings to the Association of Accounting Technicians. Board over 25 years of experience in the manufacturing industry in southern Melbourne, including a broad range of manufacturing PROFESSOR WENDY CROSS networks and associations. Todd’s particular strengths are in commercial enterprise, technology innovation and facility Wendy’s career has spanned many years in nursing, nursing research management. In addition to his role at Hilton Manufacturing, and nurse education. She is currently Head of the School of Nursing Todd also serves as the Treasurer of the South East Melbourne and Midwifery at Monash University, and was previously in a senior Manufacturing Alliance and is a board member of the Committee position at Southern Health. Her roles have encompassed practice for Dandenong. He also holds a number of other positions on development, clinical governance, policy development, performance manufacturing boards and committees. management and appraisal, workforce planning and many other activities. Wendy has been awarded numerous research and John Bennie teaching grants.
John has been CEO of Greater Dandenong City Council since October TRACEY DAVIES 2006. He is a Director of the South East Melbourne Manufacturers’ Alliance and Chair of the Southern Melbourne Regional Development Tracey is a Principal at Davies Lawyers, having been a solicitor for Australia Committee. He was previously CEO of Manningham City more than 23 years. She has represented a wide variety of clients Council from 1999 to 2006 and a Board member of South East and currently practises in the areas of employment law, industrial Development (Melbourne) Area Consultative Committee. relations and commercial litigation. Tracey is a member of the Law Institute of Victoria, Law Institute of Victoria Practice Sections – Litigation Lawyers and Administrative Law & Human Rights and Industrial Relations Society of Victoria.
20 Chisholm Institute Annual Report 2013 DAVID EDGAR BARRY JOWETT
David is currently a senior level executive as the CEO of Elected Staff Member Apprenticeship and Traineeship Employment Partners (ATEP), based Until 15/04/2013 in Melbourne. David has 17 years’ experience in vocational education, Barry works in the Chisholm libraries. He previously held roles as a employment and training and the not for profit sector with 13 of general manager, director, managing partner and business owner in a those years in senior management in a Group Training Organisation, range of industries. including management of Registered Training Organisation, Australian Apprenticeship Centre business activities and a range of LEIGH GRANT affiliated government funded initiatives.
Elected Student Member DAVID EYNON Until 15/04/2013
David is Executive Director of the Air Conditioning and Mechanical Leigh is a Chisholm student who is an elected member of the Board. Contractors Association. He has extensive experience in public policy development in connection with skills training, industrial relations MARIA PETERS and energy efficiency. David is currently director of Australian Construction Industry Forum Ltd, ARBS Exhibitions Ltd, the Joint Chisholm CEO (Ex-officio) Plumbing Industry Training Fund Ltd and the Redundancy Central Payments Fund. CEO of Chisholm Institute since 2010, Maria’s previous roles were as Deputy CEO and Executive Director Programs for the Institute. Maria has extensive experience in education, locally and internationally. GREG HUNT She has held management positions and had significant experience Until 15/04/2013 in delivery performance, professional development and tertiary education across a range of industry sectors. Greg Hunt is the Executive Officer of the South East Councils Climate Change Alliance. He was previously Principal at the Zoo Education Service and Education Manager at Melbourne Museum. Co-opted members LYNDON JOSS MEL PECEN Audit and Risk Management Until 15/04/2013
Lyndon has over 35 years of experience in senior management MICHAEL F. SAID positions in engineering and manufacturing. He is President of South Audit and Risk Management East Melbourne Manufacturers Alliance and Facilitator South East Networks. IAN DUFF Audit and Risk Management DR BRUCE CARROLL ROBERT JOHNSON Until 15/04/2013 Resource Management
Bruce has over 20 years of experience in overseeing policy and SOPHIA PETROV strategy in government departments. He is a member of the Strategic Development and Monitoring Southern Metropolitan Regional Council of Adult Community and Further Education.
Chisholm Institute Annual Report 2013 21 EXECUTIVE DIRECTORS GROUP (Senior Management Team)
The Executive Directors Group’s focus is strategic leadership and business development, with day-to-day operations largely managed by middle management under a policy and procedural framework established by the Executive Directors Group under the Board’s delegation framework.
CEO Maria Peters
Deputy CEO and Executive Director Educational Leadership & Student Experience Executive Director Executive Director Executive Director Chief Operating Officer, Peter Harrison Human, Health & Engineering, Youth, Pathways & Institute Operations Business Services Technology Regional Education Grant Radford Malcolm Macpherson & Trades Leanne Jenkins Paul Goudie* Andrew Kong
* Paul Goudie started on 2 December, 2013.
22 Chisholm Institute Annual Report 2013 C orporaTE governance
Manner of establishment The functions of Chisholm Institute are: and the relevant Minister • to provide the communities and industries serviced by the The renewed governance structure of Chisholm Institute (formerly Institute with efficient and effective technical and further known as Chisholm Institute of Technical and Further Education) education programs and services was established on 15 April 2013, when the new Chisholm Institute • to offer and conduct courses of study leading to the conferral of Constitution Order 2013 came into effect. higher education awards • subject to the requirements of the Education and Training Changes to the governance structure of Chisholm Institute included: Reform Act 2006, to operate as a group training organisation that employs apprentices and other trainees and places them • a change of name from Chisholm Institute of Technical and with host employers. Further Education to Chisholm Institute • the establishment of a new Board structure consisting of nine The Institute has the power to do all things that are necessary or Directors, comprising: convenient to be done for or in connection with, or as incidental to, - a Board Chair (new appointment) meeting its objectives or performing its functions. However, the powers of Chisholm Institute are subject to, and must be exercised in - four ministerial nominee Directors accordance with, the functions, duties and obligations conferred or - four Board nominee Directors imposed on the Institute by: • the establishment of a new governance framework based on the new Constitution • the Act and other laws • the requirement to comply with the Minister’s Strategic Planning • the Constitution and Commercial Guidelines. • Ministerial and government directions and guidelines under the Act and other legislation, laws and conventions Throughout 2013, the Board of Chisholm Institute was responsible • the general administrative, social and economic directives and to the Minister of Higher Education and Skills, the Hon. Peter Hall MLC. policies established by the Government of Victoria from time Objectives, functions, to time. powers and duties The Chisholm Institute Board must take all reasonable steps for the advancement of the objectives of the Institute, while operating in In line with the requirements of the Chisholm Institute Constitution accordance with the economic and social objectives and public sector Order 2013, the objectives of Chisholm Institute are: policy established from time to time by the Minister. While meeting its objectives, the Board is also required to comply with the Chisholm • to facilitate higher education through excellent teaching, Institute Constitution and provide all assistance and information to innovation and educational leadership that delivers quality the Minister or his delegates. outcomes • to ensure it is sustainable in the medium to long term • to operate its businesses, delivering educational services and utilising assets that it manages on the state’s behalf as efficiently as possible • to facilitate increasing opportunities for apprenticeships and traineeships across the relevant Australian industry sectors.
Chisholm Institute Annual Report 2013 23 C orporaTE governance
Board organisational chart 1 January 2013 – 15 April 2013 The following chart details the organisational arrangements and accountabilities of the Board and the Board Committees for 2013, prior to the establishment of the new Chisholm Institute Constitution on 16 April 2013.
Responsible Minister The Hon. Peter Hall MP, Minister for Higher Education and Skills
The Board of Chisholm Institute of TAFE Board Secretary David Willersdorf Joe Piper (Board Chair)
Audit and Risk Resource Management Strategic Development Management Committee and Monitoring Committee Committee
Committee Committee Committee membership membership membership Lyndon Joss (Chairperson) Robert Comelli David Eynon (Chairperson) David Willersdorf (Chairperson) David Willersdorf Tracey Davies David Willersdorf Wendy Cross Michael Said Maria Peters Barry Jowett Mel Pecen Greg Hunt Maria Peters Rob Johnson David Edgar Executive Officer David Muir John Buckler Leigh Grant Executive Officer Peter Harrison Executive Officer Grant Radford
24 Chisholm Institute Annual Report 2013 Board and Institute committees: relationships 1 January 2013 – 15 April 2013
THE BOARD OF CHISHOLM INSTITUTE OF TAFE
STRATEGIC RESOURCE DEVELOPMENT MEMBERSHIP MANAGEMENT AND MONITORING COMMITTEE AUDIT AND RISK COMMITTEE COMMITTEE MANAGEMENT
BOARD COMMITTEES BOARD COMMITTEE
REMUNERATION CHIEF EXECUTIVE OFFICER COMMITTEE
CHISHOLM DIRECTORS GROUP (CDG)
ODC/CENTRE/ OCCUPATIONAL QUALITY DIVISIONAL BOARD OF HEALTH AND SAFETY MANAGEMENT ICT STEERING STUDIES COMMITTEE COMMITTEE COMMITTEES
INSTITUTE COMMITTEES INSTITUTE Functional relationship
Monitoring relationship
Chisholm Institute Annual Report 2013 25 C orporaTE governance
Board organisational chart 16 April 2013 to 31 December 2013
Responsible Minister The Hon. Peter Hall MP, Minister for Higher Education and Skills
The Board of Chisholm Institute Board Secretary Stephen G. Marks Joe Piper Board Chair
Audit and Risk Infrastructure Education Management Committee Committee Committee
Committee members Committee members Committee members David Willersdorf (Chair) Todd Hartley (Chair) Wendy Cross (Chair) Robert Comelli Tracey Davies David Eynon Michael Said (Co-opted) John Bennie David Edgar Ian Duff (Co-opted) Rob Johnson (Co-opted) Sophia Petrov (Co-opted) Stephen G. Marks Maria Peters (Ex-officio) Maria Peters (Ex-officio) (Ex-officio) Stephen G. Marks Stephen G. Marks (Ex-officio) (Ex-officio) Executive Officer James Watson (CIO) Peter Harrison Executive Officer Executive Officer Andrew Kong Grant Radford
26 Chisholm Institute Annual Report 2013 Board Committees chart 16 April 2013 to 31 December 2013
REMUNERATION CHISHOLM INSTITUTE Delegation of power BOARD and functions by Board
Delegates power and functions to committees BOARD MEMBERSHIP and CEO Delegation of power STRATEGIC INTENT STRATEGIC and functions by Board
BOARD COMMITTEE STRUCTURE
AUDIT AND RISK EDUCATION INFRASTRUCTURE MANAGEMENT COMMITTEE COMMITTEE COMMITTEE Delegation of power Delegation of power Delegation of power and functions by Board and functions by Board and functions by Board
INSTITUTE OPERATIONAL STRUCTURE STRATEGY DEVELOPMENT STRATEGY
- All day-to-day operational matters CHIEF EXECUTIVE - human resources and industrial relations OFFICER - Financial delegation (within agreed limits) - Development of draft strategic plan and Delegation of power annual business plans and functions - Legislative and Ministerial orders - Risk management and compliance framework
INSTITUTE OPERATIONS INSTITUTE INSTITUTE OPERATIONAL COMMITTEE STRUCTURE
Chisholm Institute Annual Report 2013 27 Risk management compliance attestation
I, Maria Peters, certify that as at 31 December 2013, Chisholm Institute has a risk management framework which is consistent with the AS/NZS 31000:2009 risk management standard.
This framework, along with our internal control system, enables the Board, Executive Directors, management and staff to understand, recognise and manage significant risk exposures.
The Audit and Risk Management Committee has verified this assurance and the risk framework of Chisholm Institute was reviewed and approved at the October 2013 Board meeting.
Maria Peters Chief Executive Officer Chisholm Institute
26 February 2014 Dandenong
28 Chisholm Institute Annual Report 2013 Social responsibility
Chisholm recognises the important role it plays in the communities in WoerorkC v /return to work which it operates. Chisholm acknowledges that demonstrated social responsibility is a vital contributor to long term business success and The number of staff injuries reported for the year totalled 19, which community capability. As a Victorian Government operation, Chisholm is 35 less than the previous year (54 in 2012). Student reported also plays a key role in the Victorian Government’s commitment to injuries were also lower, with 73 incidents reported in 2013. It was social responsibility. noted that the decrease in injury numbers has also seen a decline in serious injuries requiring off site medical treatment. This commitment is reflected in: The number of accepted new WorkCover claims for 2013 totalled • Chisholm’s commitment to providing accessible programs meeting four; this is half the number of 2012 and 20 per cent of the 2010 the learning needs and vocational aspirations of its students claims (20). • Chisholm’s commitment to safety, health and the environment in all aspects • the operation of the Caroline Chisholm Education Foundation. 25
Work health, safety 20 and wellbeing 15 Chisholm considers all workplace injuries to be preventable and strives to ensure that best practice OH&S systems are integrated into business area operations. This is vital in ensuring the health, 10 safety and wellbeing of staff, students, contractors and visitors. 5 The Institute’s health and safety strategy aims to meet its statutory and employee duty of care obligations and to create a harmonious, 2013 2012 2011 2010 productive learning and working environment by providing a 0 workplace free from risks to health and safety.
Key strategies undertaken in 2013 were: Notably, WorkCover performance and management resulted in • health and wellbeing initiatives to improve staff health and Chisholm outperforming the industry premium rate, which led fitness, including an Institute-wide staff flu vaccination program, to a significant reduction in the premium. health checks, and first aid and mental health first aid training • active promotion of the Employee Assistance Program to benefit OH&S Program staff, including career transition training and manager assist Performance Indicators • external audit of the OH&S management systems by an external auditor and identification of areas of improvement The performance of Chisholm’s OH&S program in 2013 was measured against the Institute’s WorkCover premium performance. • an internal workplace inspection program to identify and address The Institute’s WorkCover premium for 2013/2014 was assessed workplace hazards. as below the industry average with a premium rate of 0.8786% . The Institute’s three year performance is 7.51% better than the Chisholm’s OH&S Management Program, in conjunction with its Injury industry average in which it operates over the last three years. Management Program, continues to work towards a reduction in The affect of this performance is that Chisholm has achieved staff injuries (number and severity), workers compensation claims a 30% saving in WorkCover premium costs for 2013/14. and WorkCover insurance premium while improving the health and welfare of staff at work.
Chisholm Institute Annual Report 2013 29 Social responsibility
Environmental sustainability The business of Chisholm Institute requires consumption of large amounts of natural resources. Chisholm is committed to reducing its impact on the environment and in 2013 continued the work that commenced in 2007.
Chisholm’s ResourceSmart Strategy covers the following key areas: • energy • water • waste minimisation and recycling • onsite renewable energy generation • green purchasing • built environment design • transportation • greenhouse gas emissions • education for sustainability • embedding of sustainability throughout our business.
The targets set for 2013 were as follows: • emission reduction 25 per cent • energy reduction 25 per cent • GreenPower purchase 25 per cent • renewable energy onsite generation 10 per cent • water reduction 35 per cent • waste recycled 45 per cent.
Chisholm’s baseline information was calculated for 2007 and the results for 2013 compared with the baseline are tabled in the Environmental Performance section of the Annual Report.
30 Chisholm Institute Annual Report 2013 2013 Annual Report Financial statements For the year ended 31 December 2013
Financial and compliance information
Financial overview 32
Chisholm Institute financial reports and performance 38 Statements Caroline Chisholm Education Foundation financial report 89
Activity table 103
Financial performance against budget 105
Disclosures index and additional compliance reports 106
Abbreviations 127
Chisholm Institute Annual Report 2013 31 Financial overview
Earnings before interest taxes and amortisation (EBITDA) EBITDA 30.0 EBITDA increased by 183.4% from the prior year. 20.0 19.3 2013 2012 $’000 $’000 Var 7.5 10.0 6.8 Operating revenues 116,608 127,654 (8.7%) 4.9 5.6 Operating expenditures 97,338 120,855 (19.5%) 0.0 EBITDA 19,270 6,799 183.4% 2009 2010 2011 2012 2013
EBITDA is the key measure of profitability. This measure is the difference between operating revenues and operating expenses.
Net surplus $M Net surplus Net surplus increased by 767% from the prior year. 40.0
30.7 2013 2012 30.0 $’000 $’000 Var 21.8 EBITDA 19,270 6,799 183% 20.0 Depreciation/ amortisation 6,859 7,196 (5%) 8.4 10.0 EBIT 12,411 (397) 3229% 6.4 3.5 Capital operations 18,256 3,934 364% 0.0 30,667 3,538 767% 2009 2010 2011 2012 2013
Net surplus results from the EBITDA, the success of obtaining capital funding from government, depreciation and expenditures from capital grants.
$M Enterprise income 50.0 46.3 Enterprise revenue 42.8 38.8 39.4 39.3 Enterprise revenue increased by 17.7% from the prior year. 40.0
2013 2012 30.0 $’000 $’000 Var Fee for service income 26,502 23,983 11% 20.0 Student fees and charges 17,083 12,482 37% Sale of goods 514 475 8% 10.0 Investment income 717 976 (27%) Other 1,468 1,423 3% 0.0 46,284 39,339 17.7% 2009 2010 2011 2012 2013
Enterprise revenue is the operating revenue excluding government contributions.
32 Chisholm Institute Annual Report 2013 Fee for service (FFS) as a % of total operating revenue % % Fee for service 25% 23% 22% 23% 2013 2012 19% 19% $’000 $’000 Var 20% FFS – Government 9,006 8,750 3%
FFS – Int. students 4,805 4,492 7% 15% FFS – Int. projects 4,395 3,974 11%
FFS – Short courses 1,700 1,576 8% 10% FFS – Other 6,596 5,191 27%
26,502 23,983 11% 5%
Fee for service revenue is a major component of enterprise revenue. Profitable fee for service revenue is the major source of funding for 0% 2009 2010 2011 2012 2013 reinvestment in Chisholm.
Chisholm Institute Annual Report 2013 33 B aLANCE sheet
Working capital
2013 2012 $’000 $’000 Var Working capital Current assets $M Cash and cash 40.0 36.9 equivalents 35,893 24,748 45% Receivables 14,198 9,432 51% 30.0 Inventories 107 137 (22%) 17.1 18.1 18.7 Prepayments 1,285 907 42% 20.0 Current liabilities 9.4 Payables and accruals (12,231) (14,036) 13% 10.0 Short term employee benefits (2,333) (2,447) 5% 0.0 36,920 18,741 97% 2009 2010 2011 2012 2013
Working capital is a measure of Chisholm’s liquidity (the ability to pay debts as they fall due) in the short term.
Net assets (equity) Net assets increased by 13% from the prior year.
2013 2012 $M Net assets $’000 $’000 Var 300.0 265.2 Assets 234.7 212.3 219.2 Current assets 51,483 35,224 46% 190.5 200.0 Non-current assets 236,040 224,330 5% Liabilities 100.0 Current liabilities (21,452) (23,756) 10% Non-current liabilities (868) (1,126) 23% 0.0 265,204 234,672 13% 2009 2010 2011 2012 2013
Net assets equal Chisholm’s totals assets less its liabilities.
The significant change in financial position is largely due to redundancies at the end of 2012 and increases in capital works related to the two large trade facilities under construction in 2013.
34 Chisholm Institute Annual Report 2013 Chisholm Institute Annual Report 2013 35 36 Chisholm Institute Annual Report 2013 Declaration BY Board chair, Chief Executive Officer and Chief Finance and Accounting Officer
We certify that the attached financial statements for Chisholm Institute have been prepared in accordance with Standing Direction 4.2 of the Financial Management Act 1994, applicable Financial Reporting Directions issued under that legislation, Australian Accounting Standards and other mandatory professional reporting requirements.
We further state that, in our opinion, the information set out in the comprehensive operating statement, balance sheet, statement of changes in equity, cash flow statement and notes to and forming part of the financial report, presents fairly the financial transactions during the year ended 31 December 2013 and financial position of the Institute as at 31 December 2013.
At the date of signing this financial report, we are not aware of any circumstance that would render any particulars included in the financial report to be misleading or inaccurate. There are reasonable grounds to believe that the Institute will be able to pay its debts as and when they became due and payable.
The Board Chair and the Chief Executive Officer sign this declaration as delegates of, and in accordance with a resolution of, the Board of the Chisholm Institute.
Stephen Marks Board Chair
26 February 2014 Dandenong
Maria Peters Chief Executive Officer
26 February 2014 Dandenong
Grant Radford Chief Finance and Accounting Officer
26 February 2014 Dandenong
Chisholm Institute Annual Report 2013 37 Comprehensive operating statement For the year ended 31 December 2013
2013 2012 Note $’000 $’000 Continuing operations Income from transactions Government contributions – operating 2a(i) 70,324 88,315 Government contributions – capital 2a(ii) 18,804 5,307 Sale of goods and services 2b 44,099 36,940 Interest 2c 717 976 Other income 2d 1,468 1,423 Total income from transactions 135,412 132,961
Expenses from transactions Employee benefits 3a 67,767 91,804 Depreciation and amortisation 3b 6,859 7,196 Grants and other transfers 3c 4 8 Supplies and services 3d 20,603 19,961 Other operating expenses 3e 10,170 10,362 Total expenses from transactions 105,403 129,331
Net result from transactions (net operating balance) 30,009 3,630
Other economic flows included in net result Net gain/(loss) on non-financial assets 4a 7 (24) Net gain/(loss) on financial instruments and statutory receivables/payables 4b (30) 1 Net gain/(loss) arising from revaluation of long service leave liability 4c 581 (302) Net gain/(loss) arising from revaluation of annual leave liability 4c 100 233 Total other economic flows included in net result 658 (92)
Net result 30,667 3,538
Other economic flows – other comprehensive income Items that will not be reclassified to net result ARR adjustment on disposal of assets 14 (136) 11,979
Comprehensive result 30,531 15,517
The above comprehensive operating statement should be read in conjunction with the accompanying notes.
38 Chisholm Institute Annual Report 2013 B aLANCE sheet As at 31 December 2013
2013 2012 Note $’000 $’000 Assets Financial assets Cash and deposits 5 35,893 24,748 Receivables 6 14,198 9,432 Total financial assets 50,091 34,180
Non-financial assets Inventories 7 107 137 Property, plant and equipment 9 234,942 223,845 Intangibles 10 1,098 485 Other non-financial assets 8 1,285 907 Total non-financial assets 237,432 225,374
Total assets 287,523 259,554
Liabilities Payables 11 6,989 11,850 Provisions 12 10,089 10,846 Other liabilities 13 5,242 2,186 Total liabilities 22,320 24,882
Net assets 265,203 234,672
Equity Accumulated surplus/(deficit) 14b 126,949 96,282 Reserves 14c 52,867 53,003 Contributed capital 14a 85,387 85,387 Net worth 265,203 234,672
Commitments for expenditure 17 Contingent assets and contingent liabilities 19
The above balance sheet should be read in conjunction with the accompanying notes.
Chisholm Institute Annual Report 2013 39 Statement of changes in equity For the year ended 31 December 2013
Transactions Total with owners in Equity at Equity at comprehensive their capacity 31 Dec 1 Jan 2013 result as owners 2013 Note $’000 $’000 $’000 $’000 Accumulated surplus/(deficit) 96,282 30,667 - 126,949 Accumulated surplus/(deficit) at the end of 96,282 30,667 - 126,949 the year
Contribution by owners 85,387 - - 85,387 Contribution by owners at the end of the 85,387 - - 85,387 year
Physical assets revaluation reserve 53,003 (136) - 52,867 53,003 (136) - 52,867
Total equity at the end of the year 234,672 30,531 - 265,203
Transactions Total with owners in Equity at Equity at comprehensive their capacity 31 Dec 1 Jan 2012 result as owners 2012 Note $’000 $’000 $’000 $’000 Accumulated surplus/(deficit) 92,744 3,538 - 96,282 Accumulated surplus/(deficit) at the end of 92,744 3,538 - 96,282 the year
Contribution by owners 85,387 - - 85,387 Contribution by owners at the end of the 85,387 - - 85,387 year
Physical assets revaluation reserve 41,024 11,979 - 53,003 41,024 11,979 - 53,003
Total equity at the end of the year 219,155 15,517 - 234,672
The above statement of changes in equity should be read in conjunction with the accompanying notes.
40 Chisholm Institute Annual Report 2013 Cash flow statement For the year ended 31 December 2013
2013 2012 Note $’000 $’000 Cash flows from operating activities Receipts Government contributions – operating 67,604 90,660 Government contributions – capital 18,804 5,307 User fees and charges 46,260 36,565 Goods and services tax recovered from the Australian Taxation Office 3,854 3,651 Interest received 717 919 Other receipts 2,012 1,924 Total receipts 139,251 139,026
Payments Payments to employees (68,617) (94,924) Payments to suppliers (33,493) (31,887) Goods and services tax paid (7,297) (6,585) Total payments (109,407) (133,396)
Net cash provided by/(used in) operating activities 15 29,843 5,630
Cash flows from investing activities Payments for non-financial assets (18,705) (7,324) Proceeds from sale of non-financial assets 7 65 Net cash provided by/(used in) investing activities (18,698) (7,259)
Net increase/(decrease) in cash and cash equivalents 11,145 (1,629)
Cash and cash equivalents at the beginning of the financial year 24,748 26,377 Cash and cash equivalents at the end of the financial year 5 35,893 24,748
The above cash flow statement should be read in conjunction with the accompanying notes.
Chisholm Institute Annual Report 2013 41 Notes to the financial statements For the year ended 31 December 2013
CONTENTS
Note Accompanying note 1 Statement of significant accounting policies 2 Income from transactions 3 Expenses from transactions 4 Other economic flows included in net result 5 Cash and cash equivalents 6 Receivables 7 Inventories 8 Other non-financial assets 9 Property, plant and equipment 10 Intangible assets 11 Payables 12 Provisions 13 Other liabilities 14 Equity 15 Cash flow information 16 Ex-gratia payments 17 Commitments for expenditure 18 Leased assets 19 Contingent assets and contingent liabilities 20 Economic dependency 21 Subsequent events 22 Remuneration of auditors 23 Superannuation 24 Key management personnel disclosures 25 Related parties 26 Institute details 27 Financial instruments
42 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
1. Statement of significant accounting policies
The annual financial statements represent the audited general purpose financial statements and notes of Chisholm Institute (Chisholm).
1.01 Statement of compliance
These general purpose financial statements have been prepared in accordance with the Financial Management Act 1994 (FMA) and applicable Australian Accounting Standards (AAS) which include Interpretations, issued by the Australian Accounting Standards Board (AASB). In particular, they are presented in a manner consistent with the requirements of the AASB 1049 Whole of Government and General Government Sector Financial Reporting.
For the purposes of preparing financial statements, Chisholm is classed as a not-for-profit entity. Where appropriate, those AAS paragraphs applicable to not-for-profit entities have been applied.
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.
1.02 Basis of preparation
The accrual basis of accounting has been applied in the preparation of 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.
These financial statements are presented in Australian dollars, the functional and presentation currency of Chisholm.
In the application of AAS, judgements, estimates and assumptions are required to be made about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on professional judgements derived from historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.
The estimates and associated assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and also in future periods that are affected by the revision. Judgements made by management in the application of AASs that have significant effects on the financial statements and estimates, with a risk of material adjustments in the next year, are disclosed throughout the notes to the financial statements.
These financial statements have been prepared in accordance with the historical cost convention. Historical cost is based on the fair values of the consideration given in exchange for assets.
Exceptions to the historical cost convention include:
• non-financial physical assets which, subsequent to acquisition, are measured at a revalued amount being their fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluations are made with sufficient regularity to ensure that the carrying amounts do not materially differ from their fair value • the fair value of an asset other than land is generally based on its depreciated replacement value • certain liabilities that are calculated with regard to actuarial assessments • available-for-sale investments which are measured at fair value with movements reflected in equity until the asset is derecognised.
The accounting policies set out below have been applied in preparing the financial statements for the year ended 31 December 2013 and the comparative information presented for the year ended 31 December 2012.
The following is a summary of the material accounting policies adopted by Chisholm in the preparation of the financial statements. The accounting policies have been consistently applied unless otherwise stated.
Chisholm Institute Annual Report 2013 43 Notes to the financial statements For the year ended 31 December 2013
1.03 Reporting entity
The financial statements cover Chisholm as an individual reporting entity. Chisholm is a statutory body corporate, established pursuant to an act made by the Victorian Government under the Education and Training Reform Act 2006 Section 3.1.12 4(a).
Its principal address is: Chisholm Institute 121 Stud Road Dandenong Vic 3175
1.04 Basis of consolidation
Chisholm operates a controlled entity, the Caroline Chisholm Education Foundation. All transactions related to the operation of the Caroline Chisholm Education Foundation are reported separately and not consolidated due to its size and operations being less than 5% of Chisholm’s.
1.05 Events after reporting date
Assets, liabilities, income or expenses arise from past transactions or other past events. Where the transactions result from an agreement between Chisholm and other parties, the transactions are only recognised when the agreement is irrevocable at or before balance date. Adjustments are made to amounts recognised in the financial statements for events which occur after the reporting date and before the date the statements are authorised for issue, where those events provide information about conditions which existed at the reporting date. Note disclosure is made about events between the reporting date and the date the statements are authorised for issue where the events relate to a condition which arose after the reporting date and which may have a material impact on the results of subsequent years.
1.06 Goods and services tax (GST)
Income, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated inclusive of the amount of GST receivable or payable (i.e. on a gross basis). The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the balance sheet.
Cash flows are included in the cash flow statement on a gross basis. The GST component of cash flows arising from investing and financing activities which is recoverable from, or payable to, the taxation authority is classified as operating cash flows.
Commitments and contingent assets or liabilities are also presented on a gross basis.
1.07 Income from transactions
Amounts disclosed as income are, where applicable, net of returns, allowances and duties and taxes. Revenue is recognised for each of Chisholm’s major activities as follows:
Government contributions
Government contributions are recognised as revenue in the period when Chisholm gains control of the contributions. Control is recognised upon receipt or notification by relevant authorities of the right to receive a contribution for the current period.
44 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Sale of goods and services (i) Student fees and charges
Student fees and charges revenue is recognised by reference to the percentage of services provided. Where student fees and charges revenue has been clearly received in respect of courses or programs to be delivered in the following year, any non-refundable portion of the fees is treated as revenue in the year of receipt and the balance as revenue in advance.
(ii) Fee for service
Fee for service revenue is recognised by reference to the percentage completion of each contract, i.e. in the reporting period in which the services are rendered. Where fee for service revenue of a reciprocal nature has been clearly received in respect of programs or services to be delivered in the following year, such amounts are disclosed as revenue in advance.
(iii) Revenue from sale of goods
Revenue from sale of goods is recognised by Chisholm when: (a) the significant risks and rewards of ownership of the goods have been transferred to the buyer (b) Chisholm retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold (c) the amount of revenue can be reliably measured (d) it is probable that the economic benefits associated with the transaction will flow to Chisholm (e) the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Interest income
Interest income from cash, short term deposits and investments is brought to account on a time proportional basis taking into account interest rates applicable to the financial assets.
Net realised and unrealised gains and losses on the revaluation of investments do not form part of income from transactions, but are reported as part of income from other economic flows in the net result or as unrealised gains and losses taken direct to equity, forming part of the total change in net worth in the comprehensive result.
Other income
Rental income is recognised on a time proportional basis and is brought to account when Chisholm’s right to receive the rental is established.
Fair value of assets received free of charge or for nominal consideration
Contributions of resources received free of charge or for nominal consideration are recognised 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. Contributions in the form of services are only recognised when a fair value can be reliably determined and the services would have been purchased if not donated.
1.08 Expenses from transactions Employee benefits
Expense for employee benefits are recognised when incurred, except for contributions in respect of defined benefit plans.
Retirement benefit obligations (i) Defined ontributionc plan
Contributions to defined contribution plans are expensed when they become payable.
Chisholm Institute Annual Report 2013 45 Notes to the financial statements For the year ended 31 December 2013
(ii) Defined benefit plans
The amount charged to the comprehensive operating statement in respect of superannuation represents the contributions made by Chisholm to the superannuation plan in respect of current services of current Chisholm staff. Superannuation contributions are made to the plans based on the relevant rules of each plan.
Chisholm does not recognise any deferred liability in respect of the plan(s) because Chisholm has no legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as and when they fall due. The Department of Treasury and Finance recognises and discloses the state’s defined benefit liabilities in its finance report.
Depreciation and amortisation Depreciation
Depreciation is provided on property, plant and equipment, including freehold buildings but excluding land. Depreciation is generally calculated on a straight-line basis so as to write off the net cost or other re-valued amount of each asset over its expected useful life to its estimated residual value. Leasehold improvements are depreciated over the period of the lease or estimated useful life, whichever is the shorter, using the straight-line method. The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period.
Depreciation methods and rates are used for each class of depreciable assets.
Class of assets Method Rates Buildings Straight line 1.69% – 20.00% (2012: 1.64% – 14.28%) Plant and equipment Straight line 10.50% – 34.00% (2012: 10.00% – 34.00%) Motor vehicles Straight line 15.00% (2012: 15.00%) Library collections Straight line 20.00% (2012: 20.00%) Land improvements Straight line 2.50% – 6.67% (2012: 2.50% – 6.67%) Leasehold improvements Straight line 19.35% (2012: 19.35%)
The assets’ residual values and useful lives are reviewed and adjusted if appropriate on an annual basis.
As part of the land and building valuation in 2012 and annual review of the useful lives of property, plant and equipment in 2013, the useful life of some buildings have been extended or reduced. The effect of this change in estimate has resulted in an overall decrease of the depreciation expense for the year ended 31 December 2013 by $64,494. This is immaterial in comparison to the total depreciation expense, net result, and total value of property, plant and equipment.
Amortisation
Intangible assets with finite lives are amortised on a straight line basis over the assets’ useful lives. Amortisation begins when the asset is available for use, that is, when it is in the location and condition necessary for it to be capable of operating in the manner intended by management. The amortisation period and the amortisation method for an intangible asset with a finite useful life are reviewed at least at the end of each annual reporting period. In addition, an assessment is made at each reporting date to determine whether there are indicators that the intangible asset concerned is impaired. If so, the assets concerned are tested as to whether their carrying value exceeds their recoverable amount.
Grants and other transfers
Grants and other transfers to third parties are recognised as an expense in the reporting period in which they are paid or payable.
Other operating expenses Supplies and services
Supplies and services expenses are recognised as an expense in the reporting period in which they are incurred. The carrying amounts of any inventories held for distribution are expensed when distributed.
46 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Fair value of assets provided free of charge or for nominal consideration
Resources provided free of charge or for nominal consideration are recognised at their fair value.
1.09 Other economic flows included in net result
Other economic flows measure the change in volume of value of assets or liabilities that do not result from transactions.
Net gain/(loss) on non-financial assets
Net gain/(loss) on non-financial assets and liabilities includes realised and unrealised gains and losses from revaluations, impairments, and disposals of all physical assets and intangibles.
Disposal of non-financial assets
Any gain or loss on disposal of non-financial assets is recognised at the date control of the asset is passed to the buyer and is determined after deducting from the proceeds the carrying value of the asset at the time.
Impairment of assets
Assets are assessed annually for indications of impairment, except for:
• inventories • financial assets • investment property that is measured at fair value • non-current assets held for sale.
If there is an indication of impairment, the assets concerned are tested as to whether their carrying value exceeds their possible recoverable amount. Where an asset’s carrying value exceeds its recoverable amount, the difference is written off by a charge to the comprehensive operating statement, except to the extent that the write down can be debited to an asset revaluation reserve amount applicable to that class of asset.
If there is an indication that there has been a change in the estimate of an asset’s recoverable amount since the last impairment loss was recognised, the carrying amount shall be increased to its recoverable amount. This reversal of the impairment loss occurs only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in prior years.
It is deemed that, in the event of the loss or destruction of an asset, the future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made.
The recoverable amount for most assets is measured at the higher of depreciated replacement cost and fair value less costs to sell. Recoverable amount for assets held primarily to generate net cash flows is measured at the higher of the present value of future cash flows expected to be obtained from the asset and fair value less costs to sell. It is deemed that, in the event of the loss of an asset, the future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made.
Net gain/ (loss) on financial instruments
Net gain/(loss) on financial instruments includes realised and unrealised gains and losses from revaluations of financial instruments that are designated at fair value through profit or loss or held-for-trading, impairment and reversal of impairment for financial instruments at amortised cost, and disposals of financial assets.
Revaluation of financial instruments at fair value
The revaluation gain/(loss) on financial instruments at fair value excludes dividends or interest earned on financial assets, which is reported as part of income from transactions.
Chisholm Institute Annual Report 2013 47 Notes to the financial statements For the year ended 31 December 2013
Impairment of financial assets
Bad and doubtful debts are assessed on a regular basis. Those bad debts considered as written off by mutual consent are classified as a transaction expense. The allowance for doubtful receivables and bad debts not written off by mutual consent are adjusted as ‘other economic flows’.
Other gains/(losses) from economic flows
Other gains/(losses) from other economic flows include the gains or losses from reclassifications of amounts from reserves and/or accumulated surplus to net result, and from the revaluation of the present value of the annual and long service leave liabilities due to changes in the bond interest rates.
1.10 Financial assets Cash and deposits
Cash and deposits, including cash equivalents, comprise cash on hand and cash at bank, deposits at call and those highly liquid investments with an original maturity of three months or less, which are held for the purpose of meeting short term cash commitments rather than for investment purposes, and which are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value.
For cash flow statement presentation purposes, cash and cash equivalents includes bank overdrafts, which are included as borrowings on the balance sheet.
Receivables
Receivables consist of:
• statutory receivables, which include predominantly amounts owing from the Victorian Government and GST input tax credits recoverable • contractual receivables, which include mainly debtors in relation to goods and services, loans to third parties, accrued investment income, and finance lease receivables.
Receivables that are contractual are classified as financial instruments. Statutory receivables are not classified as financial instruments.
Receivables are recognised initially at fair value and subsequently measured at amortised cost, using the effective interest method, less an allowance for impairment.
A provision for doubtful receivables is made when there is objective evidence that the debts may not be collected and bad debts are written off when identified.
Derecognition of financial assets
A 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 or • Chisholm retains the right to receive cash flows 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 • Chisholm has transferred its rights to receive cash flows from the asset and either: (a) has transferred substantially all the risks and rewards of the asset or (b) has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset.
48 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Where Chisholm has neither transferred nor retained substantially all the risks and rewards or transferred control, the asset is recognised to the extent of Chisholm’s continuing involvement in the asset.
At the end of each reporting period, Chisholm assesses whether there is objective evidence that a financial asset or group of financial assets is impaired. Objective evidence includes financial difficulties of the debtor, default payments, debts which are more than 60 days overdue, and changes in debtor credit ratings. All financial instrument assets, except those measured at fair value through profit or loss, are subject to annual review for impairment.
Bad and doubtful debts for financial assets are assessed on a regular basis. Those bad debts considered as written off by mutual consent are classified as a transaction expense. Bad debts not written off by mutual consent and the allowance for doubtful receivables are classified as ‘other economic flows’ in the net result.
The amount of the 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.
In assessing impairment of statutory (non-contractual) financial assets, which are not financial instruments, professional judgement is applied in assessing materiality using estimates, averages and other computational methods in accordance with AASB 136 Impairment of Assets.
1.11 Leases
A lease is a right to use an asset for an agreed period of time in exchange for payment.
Leases are classified at their inception as either operating or finance leases based on the economic substance of the agreement so as to reflect the risks and rewards incidental to ownership. Leases of property, plant and equipment are classified as finance infrastructure leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership from the lessor to the lessee. All other leases are classified as operating leases.
Finance leases Chisholm as lessor
Amounts due from lessees under finance leases are recorded as receivables. Finance lease receivables are initially recorded at amounts equal to the present value of the minimum lease payments receivable plus the present value of any unguaranteed residual value expected to accrue at the end of the lease term. Finance lease receipts are apportioned between periodic interest income and reduction of the lease receivable over the term of the lease in order to reflect a constant periodic rate of return on the net investment outstanding in respect of the lease.
Chisholm as lessee
At the commencement of the lease term, finance leases are initially recognised as assets and liabilities at amounts equal to the fair value of the lease property or, if lower, the present value of the minimum lease payment, each determined at the inception of the lease. The lease asset is depreciated over the shorter of the estimated useful life of the asset or the term of the lease.
Minimum finance lease payments are apportioned between reduction of the outstanding lease liability and periodic finance expense which is calculated using the interest rate implicit in the lease and charged directly to the comprehensive operating statement.
Chisholm Institute Annual Report 2013 49 Notes to the financial statements For the year ended 31 December 2013
Operating leases Chisholm as lessee
Operating lease payments, including any contingent rentals, are recognised as an expense in the comprehensive operating statement on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern of the benefits derived from the use of the leased asset. The leased asset is not recognised in the balance sheet.
All incentives for the agreement of a new or renewed operating lease are recognised as an integral part of the net consideration agreed for the use of the leased asset, irrespective of the incentive’s nature or form or the timing of payments.
In the event that lease incentives are received to enter into operating leases, the aggregate cost of incentives are recognised as a reduction of rental expense over the lease term on a straight-line basis, unless another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.
1.12 Non-financial assets Inventories
Inventories include goods and other property held either for sale or for distribution at no or nominal cost in the ordinary course of business operations.
Inventories, including land held for sale, are measured at the lower of cost and net realisable value.
Cost for all other inventory is measured on the basis of weighted average cost.
Inventories acquired for no cost or nominal considerations are measured at current replacement cost at the date of acquisition.
Non-current physical assets classified as held-for-sale, including disposal group assets
Non-financial physical assets (including disposal group assets) are treated as current and classified as held for sale if their carrying amount will be recovered through a sale transaction rather than through continuing use.
This condition is regarded as met only when:
• the asset is available for immediate use in the current condition • the sale is highly probable and the asset’s sale is expected to be completed within 12 months from the date of classification.
These non-financial physical assets, related liabilities and financial assets are measured at the lower of carrying amount and fair value less costs to sell, and are not subject to depreciation or amortisation.
Property, plant and equipment
All non-financial physical assets are measured initially at cost and subsequently revalued at fair value less accumulated depreciation and impairment.
The initial cost for non-financial physical assets under a finance lease is measured at amounts equal 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.
Where an asset is received for no or nominal consideration, the cost is the asset’s fair value at the date of acquisition.
The fair value of infrastructure systems and plant, equipment and vehicles is normally determined by reference to the asset’s depreciated replacement cost, or where the infrastructure is held by a for-profit entity, the fair value may be derived from estimates of the present value of future cash flows. For plant, equipment and vehicles, existing depreciated historical cost is generally a reasonable proxy for depreciated replacement cost because of the short lives of the assets concerned.
50 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Certain assets are acquired under finance leases, which may form part of a service concession arrangement.
The cost of constructed non-financial physical assets includes the cost of all materials used in construction, direct labour on the project, and an appropriate proportion of variable and fixed overheads.
Where an asset is received for no or nominal consideration, the cost is the asset’s fair value at the date of acquisition.
For the accounting policy on impairment of non-financial physical assets refer to Note on Impairment of non-financial assets.
Library collections
Library collections are measured at cost or fair value as indicated less, where applicable, any accumulated depreciation and impairment losses.
Capitalisation threshold
Chisholm’s capitalisation threshold is $5,000 exclusive of GST.
Leasehold improvements
The cost of a leasehold improvement is capitalised as an asset and depreciated over the remaining term of the lease or the estimated useful life of the improvements, whichever is the shorter.
Non-financial physical assets constructed by Chisholm
The cost of non-financial physical assets constructed by Chisholm includes the cost of all materials used in construction, direct labour on the project, and an appropriate proportion of variable and fixed overheads.
Revaluations of non-current physical assets
Non-current physical assets measured at fair value are revalued in accordance with FRDs issued by the Minister for Finance. This revaluation process normally occurs every five years, based upon the asset’s Government Purpose Classification, but may occur more frequently if fair value assessments indicate material changes in values. Revaluation increases or decreases arise from differences between an asset’s carrying value and fair value.
Revaluation increases are credited directly to equity in the revaluation surplus, except to the extent that an increase reverses a revaluation decrease in respect of that class of property, plant and equipment, previously recognised as an expense (other economic flows) in the net result, the increase is recognised as income (other economic flows) in determining the net result.
Revaluation decreases are recognised immediately as expenses (other economic flows) in the net result, except to the extent that a credit balance exists in the revaluation surplus in respect of the same class of property, plant and equipment, they are debited to the revaluation reserve.
Revaluation increases and revaluation decreases relating to individual assets within a class of property, plant and equipment are offset against one another within that class but are not offset in respect of assets in different classes.
When revalued assets are sold, it is Chisholm policy to transfer the amounts included in other reserves in respect of these assets to accumulated funds.
Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset.
Non-current physical assets constructed by Chisholm
The cost of non-current assets constructed by Chisholm includes the cost of all materials used in construction, direct labour on the project, and an appropriate proportion of variable and fixed overheads.
Chisholm Institute Annual Report 2013 51 Notes to the financial statements For the year ended 31 December 2013
Research and development costs
Expenditure on research activities is recognised as an expense in the period in which it is incurred. Where no internally-generated intangible asset can be recognised, development expenditure is recognised as an expense in the period as incurred.
An internally-generated intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of the following are demonstrated:
(a) the technical feasibility of completing the intangible asset so that it will be available for use or sale (b) the intention to complete the intangible asset and use or sell it (c) the ability to use or sell the asset (d) how the intangible asset will generate probable future economic benefits (e) the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset (f) the ability to measure reliably the expenditure attributable to the intangible asset during its development.
Where no internally-generated intangible asset can be recognised, development expenditure is recognised as an expense in the period as incurred.
Intangible assets are measured at cost less accumulated amortisation and impairment, and are amortised on a straight-line basis over their useful lives as follows:
2013 2012 Capitalised software development cost (years) 4 4
1.13 Liabilities Payables
Payables consist of:
• contractual payables, such as accounts payable, and unearned income including deferred income from concession arrangements. Accounts payable represent liabilities for goods and services provided to Chisholm prior to the end of the financial year that are unpaid, and arise when Chisholm becomes obliged to make future payments in respect of the purchase of those goods and services • statutory payables, such as goods and services tax and fringe benefits tax payables.
Contractual payables are classified as financial instruments and categorised as financial liabilities at amortised cost. Statutory payables are recognised and measured similarly to contractual payables, but are not classified as financial instruments and not included in the category of financial liabilities at amortised cost, because they do not arise from a contract.
Provisions
Provisions are recognised when Chisholm has a present obligation, the future sacrifice of economic benefits is probable, and the amount of the provision can be measured reliably.
The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows.
52 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Employee benefits
The calculation of employee benefits includes all relevant on-costs and is calculated as follows at reporting date.
(i) Wages, salaries and annual leave
Liabilities for wages and salaries, including non-monetary benefits and annual leave expected to be settled within 12 months of the reporting date are recognised in the provision for employee benefits in respect of employee services up to the reporting date, classified as current liabilities and measured at their nominal values.
Liabilities that are not expected to be settled within 12 months of the reporting date are recognised in the provision for employee benefits as current liabilities, measured at present value of the amounts expected to be paid when the liabilities are settled using the remuneration rate expected to apply at the time of settlement.
(ii) Long service leave
Liability for long service leave (LSL) is recognised in the provision for employee benefits. The provision for LSL has been revalued using a wage inflation rate of 3.56% and a discount rate of 4.28%.
Current liability – unconditional LSL representing seven years of service is disclosed as a current liability even when Chisholm does not expect to settle the liability within 12 months because it will not have the unconditional right to defer settlement of the entitlement should an employee take leave within 12 months.
The components of this current liability are measured at: • present value – component that is not expected to be settled within 12 months • nominal value – component that is expected to be settled within 12 months.
Non-current liability – conditional LSL representing less than seven years is disclosed as a non-current liability. There is an unconditional right to defer settlement of the entitlement until the employee has completed the requisite years of service.
This non-current LSL liability is measured at present value. Gain or loss following revaluation of the present value of non-current LSL liability due to changes in bond interest rates is recognised as an ‘other economic flow’.
(iii) Termination benefits
Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. Chisholm recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after balance sheet date are discounted to present value.
Employee benefits on-costs
Employee benefits on-costs (payroll tax, workers compensation, superannuation, annual leave and LSL accrued while on LSL taken in service) are included in the provision for employee benefits.
Performance payments
Performance payments for TAFE executive officers are based on a percentage of the annual salary package provided under the contract of employment. A liability is provided for under the term of the contracts at reporting date and paid out in the next financial year.
Onerous contracts
An onerous contract is considered to exist where Chisholm has a contract under which the unavoidable cost of meeting the contractual obligations exceed the economic benefits estimated to be received. Present obligations arising under onerous contracts are recognised as a provision to the extent that the present obligation exceeds the economic benefits estimated to be received.
Chisholm Institute Annual Report 2013 53 Notes to the financial statements For the year ended 31 December 2013
1.14 Commitments
Commitments include those operating, capital and other outsourcing commitments arising from non-cancellable contractual or statutory sources and are disclosed at their nominal value and inclusive of the GST payable.
1.15 Contingent assets and liabilities
Contingent assets and liabilities are not recognised in the balance sheet, but are disclosed by way of a note (refer Note 19) and, if quantifiable, are measured at nominal value. Contingent assets and liabilities are presented inclusive of the GST receivable or payable respectively.
1.16 Equity Contributed capital
Funding that is in the nature of contributions by the State Government are treated as contributed capital when designated in accordance with UIG Interpretation 1038 Contribution by Owners Made to Wholly-Owned Public Sector Entities. Commonwealth capital funds are not affected and are treated as income.
1.17 Foreign currency transactions Functional and presentation currency
Chisholm’s financial statements are presented in Australian dollars which is the entity’s functional and presentation currency.
Transactions and balances
Foreign currency transactions are translated into functional currency using the exchange rates prevailing at the date of the transaction. Foreign currency monetary items are translated at the year-end exchange rate. Non-monetary items measured at historical cost continue to be carried at the exchange rate at the date of the transaction. Non-monetary items measured at fair value are reported at the exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of monetary items are recognised in the income statement in the period in which they arise, except where deferred in equity as a qualifying cash flow or net investment hedge.
Exchange differences arising on the translation of non-monetary items are recognised directly in equity to the extent that the gain or loss is directly recognised in equity; otherwise the exchange differences are recognised in the comprehensive operating statement.
1.18 Materiality
In accordance with Accounting Standard AASB1031 Materiality, accounting policies need only be identified in the summary of accounting policies where they are considered ‘material’. Accounting policies will be considered material if their omission, misstatement or non-disclosure has the potential, individually or collectively, to:
(a) influence the economic decisions of users taken on the basis of the financial statements (b) affect the discharge of accountability by the management or governing body of the entity.
1.19 Rounding of amounts
Amounts in the financial statements have been rounded to the nearest thousand dollars, unless otherwise stated. 1.20 Comparative information
When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.
54 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
1.21 Change in accounting policy AASB 13 Fair Value Measurement
Chisholm has applied AASB 13 Fair Value Measurement for the first time in the current year. AASB 13 establishes a single source of guidance for fair value measurements. The scope of AASB 13 is broad; the fair value measurement requirements of AASB 13 apply to both financial instrument items and non-financial instrument items for which other A-IFRS require or permit fair value measurements and disclosures about fair value measurements, except for share-based payment transactions that are within the scope of AASB 2 Share-based Payment, leasing transactions that are within the scope of AASB 17 Leases, and measurements that have some similarities to fair value but not fair value (e.g. net realisable value for the purposes of measuring inventories or value in use for impairment assessment purposes).
AASB 13 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction in the principal (or most advantageous) market at the measurement date under current market conditions. Fair value under AASB 13 is an exit price regardless of whether that price is directly observable or estimated using another valuation technique. Also, AASB 13 includes extensive disclosure requirements.
AASB 13 requires prospective application from 1 January 2013. In addition, specific transitional provisions were given to entities such that they need not apply the disclosure requirements set out in the standard in comparative information provided for periods before the initial application of the standard. In accordance with these transitional provisions, Chisholm has not made any new disclosures required by AASB 13 for the 2012 comparative period (please see Note 9 and 27 disclosures). Other than the additional disclosures, the application of AASB 13 has not had any material impact on the amounts recognised in the financial statements.
AASB 119 Employee Benefits
In the current year, Chisholm has applied AASB 119 Employee Benefits (as revised in 2011) and the related consequential amendments for the first time.
AASB 119 (as revised in 2011) changes the accounting for defined benefit plans and termination benefits. The most significant change relates to the accounting for changes in defined benefit obligations and plan assets. This change has no impact on Chisholm because it has no legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as they fall due. The Department of Treasury and Finance recognises and discloses the state’s defined benefit liabilities in its financial statements.
In addition, AASB 119 also changes the definition of short term employee benefits. This change has no impact on Chisholm because Chisholm has always defined short term employee benefits as benefits expected to be settled wholly before 12 months after the end of the reporting period in which the employees render the related service; and measured the provision for annual leave on a discounted basis.
Chisholm Institute Annual Report 2013 55 Notes to the financial statements For the year ended 31 December 2013
1.22 New and revised AASBs in issue but not yet effective
Certain new accounting standards and interpretations have been published that are not mandatory for the 31 December 2013 reporting period.
As at 31 December 2013, the following standards and interpretations applicable to Chisholm had been issued but were not mandatory for financial year ending 31 December 2013. Chisholm has not, and does not intend to, adopt these standards early.
Amending Outline of amendment Application date of Impact on financial statements pronouncements and standard errata AASB 9 Financial This standard simplifies requirements for the 1 January 2015 Subject to AASB’s further modifications Instruments classification and measurement of financial to AASB 9, together with the assets resulting from Phase 1 of the IASB’s anticipated changes resulting from the project to replace IAS 39 Financial Instruments: staged projects on impairments and Recognition and Measurement (AASB 139 hedge accounting, details of impacts Financial Instruments: Recognition and will be assessed. Measurement). AASB 10 Consolidated This standard forms the basis for determining 1 January 2014 Subject to AASB’s final deliberations on Financial Statements which entities should be consolidated into an ED 238 and any modifications made to entity’s financial statements. AASB 10 defines AASB 10 for not-for-profit entities, the ‘control’ as requiring exposure or rights to entity will need to re-assess the nature variable returns and the ability to affect those of its relationships with other entities, returns through power over an investee, which including those that are currently not may broaden the concept of control for public consolidated. sector entities. The AASB has issued an exposure draft ED 238 Consolidated Financial Statements – Australian Implementation Guidance for Not-for-Profit Entities that explains and illustrates how the principles in the standard apply from the perspective of not-for-profit entities in the private and public sectors. This standard forms the basis for determining which entities should be consolidated into an entity’s financial statements. AASB 10 defines ‘control’ as requiring exposure or rights to variable returns and the ability to affect those returns through power over an investee, which may broaden the concept of control for public sector entities. The AASB has issued an exposure draft ED 238 Consolidated Financial Statements – Australian Implementation Guidance for Not-for-Profit Entities that explains and illustrates how the principles in the standard apply from the perspective of not-for-profit entities in the private and public sectors.
56 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Amending Outline of amendment Application date of Impact on financial statements pronouncements and standard errata AASB 11 Joint This standard deals with the concept of joint 1 January 2014 The AASB have finalised deliberations Arrangements control, and sets out a new principles-based and any modifications made to approach for determining the type of joint AASB 11 for not-for-profit entities; arrangement that exists and the corresponding the entity will need to assess the accounting treatment. The new categories of nature of arrangements with other joint arrangements under AASB 11 are more entities in determining whether a joint aligned to the actual rights and obligations of arrangement exists in light of AASB 11. the parties to the arrangement. AASB 12 Disclosure of This standard requires disclosure of information that 1 January 2014 Not-for-profit entities are not permitted to Interests in Other Entities enables users of financial statements to evaluate apply this standard prior to the mandatory the nature of, and risks associated with, interests application date. in other entities and the effects of those interests on the financial statements. This standard replaces Impacts on the level and nature of the the disclosure requirements in AASB 127 Separate disclosures will be assessed based on the Financial Statements and AASB 131 Interests in Joint eventual implications arising from AASB 10, Ventures. AASB 11 and AASB 128 Investments in The exposure draft ED 238 proposes to add some Associates and Joint Ventures. implementation guidance to AASB 12, explaining and illustrating the definition of a ‘structured entity’ from a not-for-profit perspective. AASB 127 Separate This revised standard prescribes the accounting 1 January 2014 Not-for-profit entities are not permitted Financial Statements and disclosure requirements for investments to apply this standard prior to the in subsidiaries, joint ventures and associates mandatory application date. The AASB is when an entity prepares separate financial assessing the applicability of principles statements. in AASB 127 in a not-for-profit context. As such, the impact will be assessed after the AASB’s deliberation. AASB 128 This revised standard sets out the requirements 1 January 2014 The impact of this standard will need Investments in for the application of the equity method when to be assessed in line with the final Associates and Joint accounting for investments in associates and deliberations by the AASB on the Ventures joint ventures. application of this standard to not-for- profit entities. AASB 1053 These standards set out the tiers of financial 1 January 2014 The Victorian Government is currently Application of Tiers of reporting and the reduced disclosure considering the impacts of Reduced Australian Accounting framework. Disclosure Requirements for certain Standards and AASB public sector entities, and has not decided 2010-2 Amendments if Reduced Disclosure Requirements will be to Australian Accounts implemented in the Victorian Standard arising from public sector. Reduced Disclosure Requirements AASB 1055 Budgetary This standard extends the scope of budgetary 1 January 2014 This standard is not applicable as no budget Reporting reporting that is currently applicable for the whole disclosure is required. of government and general government sector to not-for-profit entities within the general government sector, provided that these entities present separate budget to the Parliament.
Chisholm Institute Annual Report 2013 57 Notes to the financial statements For the year ended 31 December 2013
In addition to the new standards above, the AASB has issued a list of amending standards that are not effective for the 2013 reporting period (as listed below). In general, these amending standards include editorial and references changes that are expected to have insignificant impacts on public sector reporting. The two AASB Interpretations in the list below are also not effective for the 2013 reporting period and considered to have insignificant impacts on public sector reporting.
• AASB 2011-3 Amendments to Australian Accounting Standards – Orderly Adoption of Changes to the ABS GFS Manual and Related Amendments • AASB 2011-4 Amendments to Australian Accounting Standards to Remove Individual Key Management Personnel Disclosure Requirements • AASB 2011-6 Amendments to Australian Accounting Standards – Extending Relief from Consolidation, the Equity Method and Proportionate Consolidation – Reduced Disclosure Requirements • AASB 2011-7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards • AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13 • AASB 2011-9 Amendments to Australian Accounting Standards – Presentation of Other Comprehensive Income [AASB 1, 5, 7, 101, 112, 120, 121, 132, 133, 134, 1039, 1049] • AASB 2011-10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011) • AASB 2011-11 Amendments to AASB 119 (September 2011) arising from Reduced Disclosure Requirements • AASB 2011-12 Amendments to Australian Accounting Standards arising from Interpretation 20 • 2012-1 Amendments to Australian Accounting Standards – Fair Value Measurement – Reduced Disclosure Requirements • 2012-2 Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial Liabilities • 2012-3 Amendments to Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities • 2012-5 Amendments to Australian Accounting Standards arising from Annual Improvements 2009–2011 Cycle • 2012-7 Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements • 2013-1 Amendments to AASB 1049 – Relocation of Budgetary Reporting Requirements • 2013-3 Amendments to AASB 136 – Recoverable Amount Disclosures for Non-Financial Assets • Interpretation 21 Levies
1.23 Critical accounting judgements and key sources of estimation uncertainty
In the application of Chisholm’s accounting policies, judgements, estimates and assumptions about the carrying amounts of assets and liabilities must be made. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods.
Key sources of estimation uncertainty
The following are the key assumptions concerning the future, and other key sources of estimation uncertainty at the end of the reporting period, that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year.
Fair value measurements and valuation processes
Some of Chisholm’s assets and liabilities are measured at fair value for financial reporting purposes. In estimating the fair value of an asset or a liability Chisholm uses market-observable data to the extent it is available. Where Level 1 inputs are not available, Chisholm engages third party qualified valuers to perform the valuation.
Information about the valuation techniques and inputs used in determining the fair value of various assets and liabilities is summarised below and at Notes 9 and 27. In addition, the following table provides an analysis of assets and liabilities that are measured subsequent to initial recognition at fair value, grouped into Levels 1 to 3 based on the degree to which the fair value is observable.
58 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. • Level 2 fair value measurements are those derived from inputs other than quoted prices included within 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 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Assets/ Fair value as at Fair value Valuation technique(s) and key Significant Relationship of liabilities hierarchy assumptions unobservable unobservable measured at input(s) inputs to fair fair value value
31/12/2013 31/12/2012 1 Assets – Assets – Level 1 Quoted bid prices (unadjusted) in an NA NA $AUD $AUD active market for identical assets or Liabilities – Liabilities – liabilities that the entity can access at $AUD $AUD the measurement date.
2 Assets – Assets – Level 2 Discounted cash flow. Future cash NA NA $AUD $AUD flows are estimated based on forward Liabilities – Liabilities – exchange rates (from observable $AUD $AUD forward exchange rates at the end of the reporting period) and contract forward rates, discounted at a rate that reflects the credit risk of various counterparties.
Depreciated replacement cost as applied to non-specialised assets. 3 Assets – Assets – Level 3 Depreciated replacement cost. Specialised The higher the $AUD $AUD assets, construction Liabilities – Liabilities – estimates made cost, the higher $AUD $AUD on replacement the fair value. cost of asset
Critical judgements in applying accounting policies
The following are the critical judgement apart from those involved estimations that Chisholm has made in the process of applying the accounting policies and that have the most significant effect on the amounts recognised in the financial statements:
• discount rates applied to material balances • useful lives of personal protective equipment (PPE).
Chisholm Institute Annual Report 2013 59 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 2. Income from transactions
(a) Grants and other transfers Government financial assistance (i) Government contributions – operating Recurrent contributions 1,604 18,951 Contestable revenue 59,772 60,248 Other contributions 8,948 9,116 Total government contributions – operating 70,324 88,315
(ii) Government contributions – capital Commonwealth capital 6,976 3,468 State capital 11,828 1,839 Total government contributions – capital 18,804 5,307 Total government financial assistance 89,128 93,622
(b) Sale of goods and services Student fees and charges 17,083 12,482 Rendering of services Fee for service – government 9,006 8,750 Fee for service – international operations – onshore 4,805 4,492 Fee for service – international operations – offshore 4,395 3,974 Fee for service – other 8,296 6,767 Total rendering of services 26,502 23,983 Other non-course fees and charges Sale of goods 514 475 Total income from sale of goods and services 44,099 36,940
(c) Interest Interest on bank deposits 717 976
(d) Other income Rental income 436 528 Donations, bequests and contributions 7 3 Scholarships 11 29 Other 1,014 863 Total other income 1,468 1,423
60 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 3. Expenses from transactions
(a) Employee benefits Salaries, wages, overtime and allowances 56,662 73,153 Superannuation 4,973 6,455 Payroll tax 3,029 4,133 Workers compensation 670 898 Long service leave 997 1,342 Annual leave 565 764 Termination benefits 852 4,984 Other 19 75 Total employee benefits 67,767 91,804
(b) Depreciation Buildings 4,517 5,039 Plant and equipment 1,431 1,505 Motor vehicles 101 109 Library collections 159 182 Land improvements 59 38 Leasehold improvements 340 229 Total depreciation 6,607 7,102 Software 252 94 Total depreciation and amortisation 6,859 7,196
(c) Grants and other transfers Grants and subsidies to apprentices and trainees 4 8
(d) Supplies and services Purchase of supplies and consumables 3,619 4,242 Communication expenses 1,089 1,304 Contract and other services 5,524 5,793 Cost of goods sold/distributed (ancillary trading) 42 76 Building repairs and maintenance 2,477 2,374 Other financing costs (other than interests) 110 116 Minor tools and equipment 97 245 Equipment below capitalisation threshold 555 1,365 Fees and charges 7,090 4,446 Total supplies and services 20,603 19,961
Chisholm Institute Annual Report 2013 61 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 (e) Other operating expenses General expenses Marketing and promotional expenses 1,495 2,537 Utilities 1,755 1,759 Audit fees and services 158 175 Staff development 298 334 Travel and motor vehicle expenses 1,758 2,378 Other expenses 3,070 1,607 Total general expenses 8,534 8,790
Operating lease rental expenses 1,636 1,572 Total other operating expenses 10,170 10,362
4. Other economic flows included in net result (a) Net gain/(loss) on non-financial assets (including PPE and intangible assets) Net gain/(loss) on disposal of physical assets 7 (24) Total net gain/(loss) arising from non-financial assets 7 (24)
(b) Net gain/(loss) on financial instruments and statutory receivables/payable of1: Loans and receivables (30) 1 Total net gain/(loss) on financial instruments (30) 1
(c) Other gains/(losses) from other economic flows Net gain/(loss) arising from revaluation of LSL liabilities 581 (302) Net gain/(loss) arising from revaluation of annual leave liabilities 100 233 Total other gains/(losses) from other economic flows 681 (69) Total other economic flows included in net result 658 (92) 1 Including increase/(decrease) in provision for doubtful debts and bad debts from other economic flows – refer to Note 1.09
5. Cash and cash equivalents Cash at bank and on hand 6,191 2,521 Deposits at call 29,702 22,227 Total cash and cash equivalents 35,893 24,748
(a) Reconciliation of cash at the end of the year The above figures are reconciled to cash at the end of the financial year as shown in the statement of cash flows as follows: Balances as above 35,893 24,748 Balances as per cash flow statement 35,893 24,748
(b) Cash at bank and on hand Cash at bank is bearing floating interest rates between 2.13% and 2.38% (2012: 2.63% and 3.63%)
(c) Deposits at call The deposits are bearing floating interest rates between 2.45% and 2.95% (2012: 3.20% and 4.90%)
62 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 6. Receivables Current receivables Contractual Trade receivables 1,421 1,827 Provision for doubtful trade receivables (a) (41) (23) Other debtors 3,085 1,397 Revenue receivable 9,733 6,231 Total contractual receivables 14,198 9,432
Total current receivables 14,198 9,432 The average credit period on sales of goods is 21 days. No interest is charged on receivables for the first 21 days from the date of the invoice or thereafter.
(a) Movement in the provision for doubtful trade receivables Balance at the beginning of the year (23) (13) Reversal of unused provision recognised in net result 4 10 Increase in provision recognised in net result (41) (23) Reversal of provision for uncollectable receivables written off during the year 19 3 Balance at the end of the year (41) (23)
(b) Ageing analysis of contractual receivables Refer to Note 27 for the ageing analysis of contractual receivables
(c) Nature and extent of risk arising from contractual receivables Refer to Note 27 for a review of the nature and extent of risk arising from contractual receivables
7. Inventories Supplies and consumables – at cost 107 137 Total current inventories 107 137
8. Other non-financial assets Total current other non-financial assets Prepayments 1,285 907 Total other non-financial assets 1,285 907
Chisholm Institute Annual Report 2013 63 Notes to the financial statements For the year ended 31 December 2013
9. Property, plant and equipment
Construction Plant and Motor Land Leasehold 2013 Land Buildings in progress equipment vehicles Library imp. imp. Total $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 As at 1 Jan 2013 Cost 2,569 2,569 Valuation 45,057 166,099 - 19,630 772 2,669 1,276 1,758 237,261 Accumulated - - - (12,955) (507) (2,294) - (229) (15,985) depreciation Opening net book 45,057 166,099 2,569 6,675 265 375 1,276 1,529 223,845 amount Year ended 31 Dec 2013 Opening net book 45,057 166,099 2,569 6,675 265 375 1,276 1,529 223,845 amount Additions 17,209 513 12 107 17,841 Disposals (136) (418) (16) (570) Depreciation write-back 418 16 434 Transfer to buildings 7 (7) - Depreciation (4,517) (1,431) (101) (159) (59) (340) (6,607) Closing net book 45,057 161,453 19,771 5,757 176 323 1,217 1,189 234,942 amount At 31 Dec 2013 - Cost 19,771 1,758 21,529 Valuation 45,057 165,970 - 19,725 768 2,775 1,276 - 235,571 Accumulated - (4,517) - (13,968) (592) (2,453) (59) (569) (22,158) depreciation Net book amount 45,057 161,453 19,771 5,757 176 323 1,217 1,189 234,942
Footnote
1 The useful lives of assets as stated in Note 1 are used in the calculation of depreciation as shown in Note 3. 2 Property, plant and equipment include all operational assets.
(a) Valuations of property, plant and equipment
Fair value assessments have been performed at 31 December 2013 for all classes of assets. This assessment demonstrated that fair value was materially similar to carrying value, and therefore a full revaluation was not required this year. The next scheduled full revaluation for Chisholm will be conducted in 2017.
The fair value of the freehold land was determined based on the market comparable approach that reflects recent transaction prices for similar properties. The fair value of the buildings was determined using the cost approach that reflects the cost to a market participant to construct assets of comparable utility and age, adjusted for obsolescence. There has been no change to the valuation technique during the year.
64 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Details of Chisholm’s land and buildings and information about the recurring fair value measurement hierarchy as at 31 December 2013 are as follows:
Level 1 Level 2 Level 3 Fair value as at 31/12/13 2013 AUD ‘000 AUD ‘000 AUD ‘000 AUD ‘000 A campus in Dandenong that contains: • freehold land 12,422 12,422 • Crown land 385 385 • buildings used solely for educational purposes 63,344 63,344 • buildings used for communal purposes 5,224 5,224 A campus in Frankston that contains: • freehold land 7,825 7,825 • Crown land 2,054 2,054 • buildings used solely for educational purposes 35,803 35,803 • buildings used for communal purposes 5,784 5,784 A campus in Cranbourne that contains: • freehold land 6,576 6,576 • Crown land - - • buildings used solely for educational purposes 16,245 16,245 • buildings used for communal purposes 1,699 1,699 A campus in Berwick that contains: • freehold land 12,892 12,892 • Crown land - - • buildings used solely for educational purposes 21,214 21,214 • buildings used for communal purposes 3,186 3,186 A campus in Rosebud that contains: • freehold land 2,135 2,135 • Crown land - - • buildings used solely for educational purposes 4,949 4,949 • buildings used for communal purposes 1,482 1,482 A campus in Bass Coast that contains: • freehold land - - • Crown land 768 768 • buildings used solely for educational purposes 2,523 2,523 • buildings used for communal purposes - - There were no transfers between Level 1 and Level 2 during the year.
Chisholm Institute Annual Report 2013 65 Notes to the financial statements For the year ended 31 December 2013
Construction Plant and Motor Land Leasehold 2012 Land Buildings in progress equipment vehicles Library imp. imp. Total $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 As at 1 Jan 2012 Cost 1,170 1,170 Valuation 33,910 180,738 19,484 839 2,593 896 - 238,460 Accumulated depreciation (12,513) (12,410) (458) (2,112) (73) - (27,566) Opening net book amount 33,910 168,225 1,170 7,074 381 481 823 - 212,064 Year ended 31 Dec 2012 Opening net book amount 33,910 168,225 1,170 7,074 381 481 823 - 212,064 Additions 5,805 1,101 - 76 12 6,994 Disposals (1,043) (67) - - - (1,110) Net revaluation increments/ 11,147 352 479 11,978 decrements Depreciation write-back 961 60 1,020 Transfer to buildings 2,561 (2,561) - Transfer to leasehold (1,758) 1,758 - improvements Transfer to plant and equipment (88) 88 - Depreciation (5,039) (1,505) (109) (182) (38) (229) (7,102) Closing net book amount 45,057 166,099 2,569 6,675 265 375 1,276 1,528 223,845 At 31 Dec 2012 Cost 2,569 2,569 Valuation 45,057 166,099 - 19,630 772 2,669 1,276 1,758 237,261 Accumulated depreciation -- - (12,955) (507) (2,294) - (229) (15,985) Net book amount 45,057 166,099 2,569 6,675 265 375 1,276 1,528 223,845
66 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
10. Intangible assets
2013 Software Total $’000 $’000 As at 1 Jan 2013 Cost 579 579 Accumulated amortisation and impairment (94) (94) Net book amount 485 485 Year ended 31 Dec 2013 Opening net book amount 485 485 Additions from internal developments 865 865 Disposals - Impairment losses charged to net result - Amortisation charge 1 (252) (252) Closing net book amount 1,098 1,098
2012 Software Total $’000 $’000 As at 1 Jan 2012 Cost 260 260 Accumulated amortisation and impairment (12) (12) Net book amount 248 248 Year ended 31 Dec 2012 - Opening net book amount 248 248 Additions from internal developments 331 331 Disposals - Impairment losses charged to net result - Amortisation charge 1 (94) (94) Closing net book amount 485 485
1 Amortisation charged is reported as an expense from transactions in the comprehensive operating statement.
Chisholm has capitalised software development expenditure for the upgrade of its Strata software. The carrying amount of the capitalised software development expenditure is $1.1 million (2012: $0.5 million). Its useful life is four years and will be fully amortised in 2017.
Chisholm Institute Annual Report 2013 67 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 11. Payables Current Contractual Supplies and services 5,105 2,701 Amounts payable to governments and agencies 389 6,298
Statutory GST payable 638 752 Group tax payable 547 1,587 FBT payable 45 56 Other taxes payable 265 456 Total current payables 6,989 11,850
(a) Foreign currency risk The carrying amounts of the entity’s payables are denominated in the following currency: Australian dollars 6,989 11,850
Notes 1. The average credit period is 30 days. No interest is charged on the other payables for the first 30 days from the date of the invoice or thereafter.
2. For an analysis of the sensitivity of payables to foreign currency risk refer to Note 27.
Maturity analysis of contractual payables Refer to Note 27 for maturity analysis of contractual payables.
68 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 12. Provisions Current provisions expected to be settled within 12 months Employee benefits Annual leave 1,161 1,292 Long service leave 932 964 Performance payments 190 140 Time off in lieu 50 51 Subtotal 2,333 2,447
Current provision expected to be settled after 12 months Annual leave 675 776 Long service leave 6,213 6,497 Subtotal 6,888 7,273 Total current provisions 9,221 9,720
Non-current provisions Long service leave 868 1,126 Total non-current provisions 868 1,126 Total provisions 10,089 10,846
Movement in provisions Movement in provisions during the financial year are set out below: Carrying amount at the start of the year 10,846 14,576 Additional provisions recognised 1,611 2,228 Amounts used (1,687) (6,027) Increase/(decrease) due to remeasurement (681) 69 Carrying amount at the end of the year 10,089 10,846
13. Other liabilities Current Revenue in advance 5,242 2,186 Total current other liabilities 5,242 2,186
Maturity analysis of other liabilities Refer to Note 27 for maturity analysis of other liabilities.
Chisholm Institute Annual Report 2013 69 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 14. Equity (a) Contributed capital Balance at 1 January 85,387 85,387 Capital contributions - - Balance at 31 December 85,387 85,387
(b) Accumulated surplus/(deficit) Balance at 1 January 96,282 92,744 Net result for the year 30,667 3,538 Balance at 31 December 126,949 96,282
(c) Reserves Composition of reserves Physical asset revaluation surplus 52,867 53,003 Balance at the end of the year 52,867 53,003
Total equity 265,203 234,672
Movement in reserves Asset revaluation reserve – Land Balance at 1 January 31,482 20,335 Revaluation increment on non-current asset - 11,147 Balance at 31 December 31,482 31,482
Asset revaluation surplus – Buildings Balance at 1 January 21,521 20,689 Revaluation increment on non-current asset 832 Revaluation (decrement) on non-current asset (136) - Balance at 31 December 21,385 21,521
70 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
2013 2012 Note $’000 $’000 15. Cash flow information
Reconciliation of operating result after income tax to net cash flows from operating activities
Net result for the year 30,667 3,538
Non-cash flows in operating result Depreciation and amortisation of non-financial assets 6,859 7,196 Net gain/(loss) on sale of non-financial assets (7) 24
Movements in operating assets and liabilities Decrease/(increase) in trade receivables (4,766) (4,630) Decrease/(increase) in inventories 30 25 Decrease/(increase) in other assets (378) 109 Increase/(decrease) in payables (1,805) 3,098 Increase/(decrease) in provisions (757) (3,730) Net cash flows provided by operating activities 29,843 5,630
16. Ex-gratia payments
Chisholm made a total of $13,882 in ex-gratia payments during 2013 (2012:$16,746) to one former employee upon termination of employment.
17. Commitments for expenditure
Capital commitments
Capital expenditure contracted for at the reporting date but not recognised as liabilities is as follow:
Payable: Within one year 19,979 617 Later than one year but not later than five years 4,763 411 Total capital expenditure commitments 24,742 1,028 GST reclaimable on the above 2,249 93 Net capital commitments 22,493 935
Operating lease commitments
Operating lease commitments in relation to leases contracted for at the reporting date but not recognised as liabilities are as follow:
Payable: Within one year 1,588 1,699 Later than one year but not later than five years 1,343 1,585 Total lease commitments 2,931 3,284 GST reclaimable on the above 266 299 Net operating lease commitments 2,665 2,985
Chisholm Institute Annual Report 2013 71 Notes to the financial statements For the year ended 31 December 2013
Other expenditure commitments
Expenditure commitments for maintenance services in existence at reporting date but not recognised as liabilities are as follow:
2013 2012 Note $’000 $’000 Payable: Within one year 5,077 4,977 Later than one year but not later than five years 2,512 7,446 Total other expenditure commitments 7,589 12,423 GST reclaimable on the above 690 1,129 Net other expenditure commitments 6,899 11,294
Remuneration commitments
Commitments for the payment of salaries and other remuneration under long term employment contracts in existence at reporting date but not recognised as liabilities are as follow:
Payable: Within one year 14,593 12,534 Later than one year but not later than five years 7,928 10,947 Total remuneration commitments 22,521 23,481
18. Leased assets
Non-cancellable operating lease receivables
Receivable: Within one year 227 351 Later than one year but not later five years 314 537 Total lease receivables 541 888 GST payable on the above 49 81 Net operating lease receivables 492 807
Chisholm leases out certain land, buildings and equipment, which are excess to current requirements at current market rates.
19. Contingent assets and contingent liabilities
There were no contingent assets as at 31 December 2013 (2012: nil) that may have had a material effect on the financial operations of Chisholm.
Contingent liabilities as at 31 December 2013 amount to $187,824 (2012: $187,824) and relates to a performance bond bank guarantee issued in favour of Qatar National Bank for Qatar Petroleum.
20. Economic dependency
Chisholm has substantial economic dependency on government operating and capital contributions.
72 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
21. Subsequent events
No matters or circumstances have arisen since the end of the reporting period which significantly affected or may significantly affect the operations of Chisholm, the results of those operations, or the state of affairs on Chisholm in future financial years.
22. Remuneration of auditors
2013 2012 Note $’000 $’000 Remuneration of Victorian Auditor-General’s Office for: Audit of the Chisholm Institute financial statements 60 59 Audit of the Caroline Chisholm Education Foundation financial statements 3 3 Remuneration of other auditors 95 113 Total remuneration of auditors 158 175
23. Superannuation
Chisholm contributes to both defined benefit and defined contribution plans. In accordance with accounting policy 1.13 Chisholm does not recognise any defined benefit liabilities. Contributions are included as part of employee benefits in the comprehensive operating statement.
The name and details of the major superannuation funds and contributions made by Chisholm are as follows:
Paid contribution for the year Defined benefit plans: State Superannuation Fund – revised and new 835 752 Total defined benefit plans 835 752
Defined contribution plans: VicSuper 3,811 4,155 Other 1,723 1,677 Total defined contribution plans 5,534 5,832
Total paid contribution for the year 6,369 6,584
Contribution outstanding at year end Defined benefit plans: State Superannuation Fund – revised and new - 124 Total defined benefit plans - 124
As at 31 December 2013 there were no loans to Chisholm from any funds (2012: nil).
Chisholm Institute Annual Report 2013 73 Notes to the financial statements For the year ended 31 December 2013
24. Key management personnel disclosures
Responsible persons related disclosures
In accordance with the directions of the Minister for Finance under the Financial Management Act 1994, the following disclosures are made for the responsible Ministers and responsible Members of the Board.
(i) Minister
The relevant Minister is the Hon. Peter Hall MP, Minister for Higher Education and Skills. Remuneration of the Ministers is disclosed in the financial statements of the Department of Premier and Cabinet. Other relevant interests are declared in the Register of Members’ Interests, which is completed by each member of the Parliament.
(ii) (a) Members of the Chisholm Board
Name Category of appointment Relevant period Stephen G. Marks (Chair) Ministerial Appointment 16/04/2013 – 31/12/2013 David Willersdorf Ministerial Nominee Director 01/01/2013 – 31/12/2013 Tracey Davies Ministerial Nominee Director 01/01/2013 – 31/12/2013 Wendy Cross Board Nominee Director 01/01/2013 – 31/12/2013 Lyndon Joss Ministerial Industry Member 01/01/2013 – 15/04/2013 Bruce Carroll Ministerial Industry Member 01/01/2013 – 15/04/2013 Robert Comelli Ministerial Nominee Director 01/01/2013 – 31/12/2013 David Eynon Ministerial Nominee Director 01/01/2013 – 31/12/2013 David Edgar Board Nominee Director 01/01/2013 – 31/12/2013 Greg Hunt Co-Opted Member 01/01/2013 – 15/04/2013 Barry Jowett Elected Staff Member 01/01/2013 – 15/04/2013 Leigh Grant Elected Student Member 01/01/2013 – 15/04/2013 John Bennie Board Nominee Director 01/09/2013 – 31/12/2013 Todd Hartley Board Nominee Director 01/06/2013 – 31/12/2013 Maria Peters Chief Executive Officer 14/01/2013 – 08/04/2013 Peter Harrison Chief Executive Officer (Acting) 01/01/2013 – 13/01/2013 09/04/2013 – 14/04/2013
(b) Other Board Committee members
Name Board Committee Relevant period Mel Pecen Audit and Risk Management Committee 01/01/2013 – 15/04/2013 Michael Said Audit and Risk Management Committee 01/01/2013 – 31/12/2013 Robert Johnson Resource Management Committee/Infrastructure Committee 01/01/2013 – 31/12/2013 Ian Duff Audit and Risk Management Committee 01/07/2013 – 31/12/2013 Sophia Petrov Strategic Development and Monitoring Committee/Education 01/01/2013 – 31/12/2013 Committee
74 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
(iii) Executive officers
The following persons also had authority and responsibility for planning, directing and controlling the activities of Chisholm during the financial year:
Name Centre/Division Relevant period Maria Peters Chief Executive Officer 01/01/2013 – 31/12/2013 Peter Harrison Deputy Chief Executive Officer 01/01/2013 – 31/12/2013 Grant Radford Executive Director, Institute Operations (Chief Operating Officer) 01/01/2013 – 31/12/2013 Andrew Kong Executive Director, Engineering, Technology & Trades 01/01/2013 – 31/12/2013 Malcolm Macpherson Executive Director, Human, Health & Business Services 01/01/2013 – 31/12/2013 Paul Goudie Executive Director, Human, Health & Business Services 02/12/2013 – 31/12/2013 Leanne Jenkins Executive Director, Youth, Pathways & Regional Education 01/01/2013 – 31/12/2013 Ian McAllister Executive Director, Growth & Development 01/01/2013 – 24/05/2013 Margot Stevenson Executive Director, People & Development 01/01/2013 – 16/05/2013
Remuneration of Board members
This includes remuneration received, or due and receivable from Chisholm in connection with the management of Chisholm. This includes termination payments and bonuses paid at the end of contracts.
2013 2012 Note $’000 $’000 Remuneration of Board members 276 322
Note 1. Due to the change in the composition of the Board which took effect on the 15 April, the CEO is included in the remuneration of Board members from the 1 January to the 14 April 2013 only.
Income range
The number of Board members whose remuneration from Chisholm was within the specified bands are as follows:
2013 2012 $0 3 3 Less than $10,000 3 8 $10,000 – $19,999 3 - $20,000 – $29,999 3 - $30,000 – $39,999 1 - $40,000 – $49,999 1 - $70,000 – $79,999 1 - $280,000 – $289,999 - 1 Total number of Board members 15 12
Note
1. The total number of Board members at any time during the year was 12, however due to the change in the composition of the Board some Board members resigned and were replaced (refer to 24 (ii) (a) above).
Chisholm Institute Annual Report 2013 75 Notes to the financial statements For the year ended 31 December 2013
Executive officers’ remuneration 2013 2012 Note $’000 $’000 Base remuneration of executive officers 1,079 1,542 Total remuneration of executive officers 1,278 2,302
Income range
The number of executive officers whose total remuneration exceeded $100,000 during the financial year are shown in their relevant income bands. The base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits.
2013 2013 2012 2012 Base Total Base Total $10,000 – $19,999 1 1 - - $50,000 – $59,999 1 - - - $60,000 – $69,999 1 - - - $80,000 – $89,999 - 1 - - $100,000 – $109,999 - - 2 - $110,000 – $119,999 - - 1 - $120,000 – $129,999 - 1 - - $130,000 – $139,999 - - 2 - $140,000 – $149,999 3 - 2 - $150,000 – $159,999 - 2 2 1 $160,000 – $169,999 1 - 1 2 $170,000 – $179,999 2 1 - 2 $180,000 – $189,999 - 2 1 1 $190,000 – $199,999 - 1 - 1 $200,000 – $209,999 - - - 1 $250,000 – $259,999 - - - 2 $330,000 – $339,999 - - - 1 Total number of executive officers 9 9 11 11 Total annualised employee equivalent (AEE)(a) 6.5 6.5 9.6 9.6
(a) Annualised employee equivalent is based on working 38 ordinary hours per week over the reporting period.
2013 2012 Note $’000 $’000 Executive officers’ personnel compensation Short term employee benefits 1,079 1,649 Post-employment benefits 108 141 Other long term benefits - 5 Termination benefits 91 507 Total key management personnel compensation 1,278 2,302
76 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
(iv) Payments to other personnel
The number of contractors charged with significant management responsibilities is disclosed within the $10,000 expense band. These contractors are responsible for planning, directing or controlling, directly or indirectly, the entity’s activities.
The change in total expenses from the 2012 to 2013 reporting period was mainly driven by transition planning being undertaken by the entity in the 2013 reporting period.
Expense band Total expenses (exclusive of GST) 2013 2012 No. No. $110,000 – $119,000 - 1 $160,000 – $169,000 1 - $170,000 – $179,000 1 - Total expenses ($’000) 342 113
25. Related parties
(a) K ey management personnel
Disclosures relating to executives are set out in Note 24.
(b) Other related party transactions
2013 2012 Note $’000 $’000 Creditor – Caroline Chisholm Education Foundation (CCEF) 168 48
Related party, CCEF revenue Administration charge 6 6
Related party, CCEF expenditure Donations 89 109 Resources provided free of charge 103 90 Total related party, CCEF expenditure 192 199
26. Chisholm details
The registered office of and principal place of business of Chisholm is:
Chisholm Institute 121 Stud Road Dandenong Vic 3175
Chisholm Institute Annual Report 2013 77 Notes to the financial statements For the year ended 31 December 2013
27. Financial instruments
Financial risk management
(i) Financial risk management objectives
Chisholm’s activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. Chisholm’s overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of Chisholm by adhering to principles on foreign exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess liquidity.
Compliance with policies and exposure limits is reviewed by management on a continuous basis. Chisholm does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.
Chisholm uses different methods to measure different types of risk to which it is exposed. These methods include sensitivity analysis in the case of interest rate and credit risk, ageing analysis for credit risk and data analysis in respect of investment portfolios to determine market risk.
Chisholm’s treasury function provides services to its business units, coordinates access to domestic and international financial markets, monitors and manages the financial risks relating to the operations of Chisholm through internal risk reports which analyse exposures by degree and magnitude of risks. These risks include market risk (including currency risk and fair value interest rate risk), credit risk and liquidity risk.
(ii) Financial risk exposures and management
Chisholm’s financial instruments consist mainly of deposits with banks, local money market instruments, short term investments, accounts receivables and payables and leases.
The main risks Chisholm is exposed to through its financial instruments are market risk, foreign currency risk, price risk, funding risk, interest rate risk, credit risk and liquidity risk.
(iii) Categorisation of financial instruments
Carrying amount of financial instruments by category:
2013 2012 Note Category $’000 $’000 Financial assets Cash and deposits 5 Cash 35,893 24,748 Receivables 6, (a) Loans and receivables 14,198 9,432
Financial liabilities Creditors and accruals 11, 13 Financial liabilities 10,737 11,185
78 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Net holding gain/(loss) on financial instruments by category:
2013 2012 Note Category $’000 $’000 Financial assets Cash and deposits 5 Cash - - Receivables 6, (a) Loans and receivables - 30 1
Financial liabilities Creditors and accruals 11, 13 Financial liabilities - -
(a) Receivables and payables disclosed here exclude statutory receivables and statutory payables.
Market risk
Chisholm in its daily operations is exposed to a number of market risks. Market risks relate to the risk that market rates and prices will change and that this will have an adverse effect on the operating result and/or net worth of Chisholm.
The Board ensures that all market risk exposure is consistent with Chisholm’s business strategy and within the risk tolerance of Chisholm. Regular risk reports are presented to the Board.
There has been no significant change in Chisholm’s exposure, or its objectives, policies and processes for managing market risk or the methods used to measure this risk from the previous reporting period.
Foreign currency risk
Chisholm does not have any foreign currency bank accounts denominated in foreign currency at 31 December 2013.
The amount of trade receivables denominated in foreign currency at 31 December 2013 is immaterial.
There has been no significant change in Chisholm’s exposure, or its objectives, policies and processes for managing foreign currency risk or the methods used to measure this risk from the previous reporting period.
Price risk
Chisholm is exposed to price risk in respect of changes to the market price of investments.
There has been no significant change in Chisholm’s exposure, or its objectives, policies and processes for managing price risk or the methods used to measure this risk from the previous reporting period.
Interest rate risk
Interest rate risk arises from the potential for a change in interest rates to change the expected net interest earnings in the current reporting period and in future years. Similarly, interest rate risk also arises from the potential for a change in interest rates to cause a fluctuation in the fair value of the financial instruments.
The objective is to manage the rate risk to achieve stable and sustainable net interest earnings in the long term. This is managed predominately through a mixture of short term and longer term investments.
Chisholm Institute Annual Report 2013 79 Notes to the financial statements For the year ended 31 December 2013
Interest rate movements have not been sufficiently significant during the year to have an impact on Chisholm’s year end result.
Chisholm’s exposure to interest rate risks and the effective interest rates of financial assets and financial liabilities, both recognised and unrecognised at balance date, are set out in the financial instrument compositions and maturity analysis table.
Funding risk
Funding risk is the risk of over reliance on a funding source to the extent that a change in that funding source could impact on the operating result for the current year and future years.
Chisholm manages funding risk by continuing to diversify and increase funding from commercial activities, both domestically and off shore.
There has been no significant change in Chisholm’s exposure, or its objectives, policies and processes for managing funding risk or the methods used to measure this risk from the previous reporting period.
Credit risk
Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in a loss to Chisholm.
The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets, is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the balance sheet and notes to the financial statements.
There is no material amounts of collateral held as security at 31 December 2013.
Credit risk is reviewed regularly by the Financial Services department. It arises from exposure to customers as well as through certain deposits with financial institutions.
The Financial Services department monitors credit risk by actively assessing the rating quality and liquidity of counter parties and Chisholm seeks to mitigate credit risk by ensuring:
• only banks and financial institutions with an ‘AAA’ rating are utilised • all potential non-student customers are rated for credit worthiness taking into account their size, market position and financial standing • customers that do not meet Chisholm’s credit policies may only purchase in cash or using recognised credit cards.
Chisholm does not have any material credit risk exposure to any single receivable or group of receivables under financial instruments entered into by Chisholm.
The trade receivables balance at 31 December 2013 and 31 December 2012 do not include any counter parties with external credit ratings.
Liquidity risk
Ultimate responsibility for liquidity risk management rests with Chisholm’s governing body, which has built an appropriate liquidity risk management framework for the management of the short, medium and long term funding and liquidity requirements. Chisholm manages liquidity risk by maintaining adequate reserves and banking facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.
There has been no significant change in Chisholm’s exposure, or its objectives, policies and processes for managing liquidity risk or the methods used to measure this risk from the previous reporting period.
80 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
Summarised sensitivity analysis
The following table summarises the sensitivity of Chisholm’s financial assets and financial liabilities to interest rate risk and credit risk:
Interest rate risk -0.50% 1.00% Carrying Result Equity Result Equity amount 31 December 2013 $’000 $’000 $’000 $’000 $’000 Financial assets Cash and deposits 35,893 (179) (179) 359 359 Receivables1 14,198 Financial liabilities Payables1 10,737 Total increase/(decrease) (179) (179) 359 359
Interest rate risk -0.50% 1.00% Carrying Result Equity Result Equity amount 31 December 2012 $’000 $’000 $’000 $’000 $’000 Financial assets Cash and cash equivalents 24,748 (124) (124) 247 247 Receivables1 9,432 Financial liabilities Payables1 11,185 Total increase/(decrease) (124) (124) 247 247
1 Receivables and payables disclosed here as financial instruments exclude statutory receivable and statutory payables.
Chisholm Institute Annual Report 2013 81 Notes to the financial statements For the year ended 31 December 2013
(iv) Financial instrument composition and interest rate exposure
The tables below reflect the undiscounted contractual settlement terms for financial instruments of a fixed period of maturity, as well as management’s expectations of the settlement period for all other financial instruments. Additionally, the total amount of financial assets disclosed excludes statutory receivables. Due to the aforementioned factors, the amounts below may not reconcile to the balance sheet.
Weighted Fixed Floating Non- Total average 1 to 6 6 to 12 Over 12 interest interest interest carrying effective months months months rate rate bearing amount rate 2013 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Financial assets Cash and deposits Cash on hand 9 9 Cash at bank 2.21% 6,181 6,181 Deposits at call 2.68% 29,702 29,702 Receivables Trade debtors 1,421 1,421 Other debtors 12,777 12,777 Total financial assets 35,883 14,208 50,090 Financial liabilities Trade and other payables Creditors and accruals (10,737) (10,737) Total financial liabilities (10,737) (10,737)
Weighted Fixed Floating Non- Total average 1 to 6 6 to 12 Over 12 interest interest interest carrying effective months months months rate rate bearing amount rate 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Financial assets Cash and deposits Cash on hand 10 10 Cash at bank 3.09% 2,511 2,511 Deposits at call 4.17% 22,227 22,227 Receivables Trade debtors 1,827 1,827 Other debtors 7,605 7,605 Total financial assets 24,738 9,442 34,180 Financial liabilities Trade and other payables Creditors and accruals (11,185) (11,185) Total financial liabilities (11,185) (11,185)
82 Chisholm Institute Annual Report 2013 Notes to the financial statements For the year ended 31 December 2013
(v) Ageing analysis of financial assets
There are no financial assets that have had their terms renegotiated so as to prevent them from being past due or impaired, and they are stated at the carrying amounts as indicated. The following table discloses the contractual maturity analysis for Chisholm’s financial assets and financial liabilities.
Not past Maturity dates Impaired Carrying due 1 – 3 3 months – financial amount and not 1 – 5 years assets impaired months 1 year $’000 $’000 $’000 $’000 $’000 $’000 2013 financial assets Receivables: Trade receivables 1,380 569 578 231 2 41 Other receivables 12,818 12,818 - - - - Total financial assets 14,198 13,387 578 231 2 41
2013 financial liabilities Payables: Trade and other payables 10,737 10,737 - - - - Total financial liabilities 10,737 10,737 - - - -
2012 financial assets Receivables: Trade receivables 1,804 921 675 176 32 23 Other receivables 7,628 7,628 - - - - Total financial assets 9,432 8,549 675 176 32 23
2012 financial liabilities Payables: Trade and other payables 11,185 11,185 - - - - Total financial liabilities 11,185 11,185 - - - -
Fair value estimation
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes.
Due to the short term nature of the current receivables and payables, their carrying value is assumed to approximate their fair value. Based on credit history it is expected that the receivables that are neither past due nor impaired will be received when due.
For other assets and other liabilities the fair value approximates their carrying value. Financial assets where the carrying amount exceeds fair value have not been written down as Chisholm intends to hold these assets to maturity.
Chisholm Institute Annual Report 2013 83 Notes to the financial statements For the year ended 31 December 2013
The carrying amounts and aggregate net fair values of financial assets and liabilities at balance date are:
Total carrying amount as per the balance Net fair value sheet
2013 2012 2013 2012 $’000 $’000 $’000 $’000 Financial assets Cash at bank and on hand 6,191 2,521 6,191 2,521 Deposits at call 29,702 22,227 29,702 22,227 Receivables – debtors 1,380 1,804 1,380 1,804 Receivables – other debtors 12,818 7,628 12,818 7,628 Total financial assets 50,091 34,180 50,091 34,180
Financial liabilities Creditors and accruals 10,737 11,185 10,737 11,185 Total financial liabilities 10,737 11,185 10,737 11,185
Financial instruments that are measured subsequent to initial recognition at fair value are grouped into Levels 1 to 3 based on the degree to which the fair value is observable.
• Level 1 fair value measurements are those derived from quoted prices (unadjusted) in active markets for identical assets or liabilities. • Level 2 fair value measurements are those derived from inputs other than quoted prices included within 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 fair value measurements are those derived from valuation techniques that include inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Chisholm did not have any financial instruments that are measured subsequent to initial recognition at fair value in 2013.
84 Chisholm Institute Annual Report 2013 Chisholm Institute Annual Report 2013 85 86 Chisholm Institute Annual Report 2013 Declaration by Board Chair, Chief Executive Officer and Chief Finance and Accounting Officer
In our opinion, the accompanying Statement of Performance of Chisholm Institute in respect of the 2013 financial year is presented fairly in accordance with the Financial Management Act 1994.
The Statement outlines the performance indicators as determined by the responsible Minister, pre-determined targets and the actual results for the year against these indicators, and an explanation of any significant variance between the actual results and performance targets.
As at the date of signing, we are not aware of any circumstance which would render any particulars in the Statement to be misleading or inaccurate.
Stephen Marks Board Chair
26 February 2014 Dandenong
Maria Peters Chief Executive Officer
26 February 2014 Dandenong
Grant Radford Chief Finance and Accounting Officer
26 February 2014 Dandenong
Chisholm Institute Annual Report 2013 87 Performance statement For the year ended 31 December 2013
K ey Performance Indicator Definition 2013 2013 2012 result actual target actual Number of students within the age Participation of 15–24 year olds 19,945 18,433 18,433 Achieved group Number of students within the age Not achieved Participation of 25–64 year olds 17,510 18,550 18,550 group (a) Rate scheduled hours assessed as passed or satisfactorily completed/ Module load completion total scheduled hours reported less 87.12% 86.65% 86.65% Achieved hours recorded with credit transfer and continuing studies outcomes Not achieved Student satisfaction Student satisfaction 74.4% 75.0% 75.0% (b) Total cost per student contact Total funded expenditure (excluding $ 8.47 $ 9.72 $ 11.16 Achieved hour (SCH) depreciation)/ total SCH Current assets/current liabilities Working capital ratio (adjusted for non-current employee 3.54 2.30 2.14 Achieved benefit liabilities) Funded operating surplus/total Net operating margin revenue (excl capital and exp from 16.53% 0.15% 5.31% Achieved capital) Fee for service revenue Fee for service revenue 26,503,703 25,209,000 23,982,688 Achieved Total revenue (excl. capital)/average Revenue per EFT staff $ 136,719 $ 130,723 $ 122,862 Achieved EFT staff Student contact hours (SCH) 11,631,654 11,089,767 10,984,000 Achieved Percentage reduction in energy Energy consumption consumption. (2010 cons. – 2007 26.8% 25.0% 20.0% Achieved cons.)/2007 consumption
(a) Changes in the training market conditions saw a market trend towards the engagement of youth and fewer adults at Chisholm.
(b) There is no material statistical difference between the target and outcome.
88 Chisholm Institute Annual Report 2013 Caroline Chisholm Education Foundation financial report
‘I promise to know neither country nor creed, Caroline Chisholm (picture courtesy National Library of Australia) but to serve all justly and impartially.’
The Caroline Chisholm Education Foundation is a further example of Chisholm’s commitment to social responsibility. It was established in 2006 by the Chisholm Board, recognising that many students needed financial support to access or remain in vocational education in the southern region. It was identified that many students have had a difficult journey in life, experiencing circumstances such as unemployment, a refugee background, single parenthood, a disability, homelessness or family adversity.
The Caroline Chisholm Education Foundation was established to assist students in hardship and raises funds for scholarships to help with course fees and other study expenses.
The formation of the Caroline Chisholm Education Foundation was inspired by the activism, energy and ‘can do’ approach of Caroline Chisholm. One of Australia’s greatest humanitarians, she assisted young people and women in their struggles to create a new life in Australia. On her arrival in the new Australian colony in 1838, she was compelled to help change the appalling conditions of poor, vulnerable migrants. “I promise to know neither country nor creed, but to serve all justly and impartially,” she wrote.
The Foundation proudly bears the name of this remarkable woman and the Trustees are committed to continuing her vision and ideals of social justice.
Chisholm Institute provides administrative and some in-kind support to the Foundation’s Secretariat to enable the focus to be on developing relationships with donors and the community to raise funds for scholarships, which are granted to students via a selection process.
Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 89 Management of the Caroline Caroline Chisholm Education Chisholm Education Foundation Foundation grants Students receive grants in accordance with their individual needs. This may include tuition, amenities and materials fees for programs The Caroline Chisholm Education Foundation is a ‘controlled-entity’ of undertaken or study support items such as computers, printers and the Chisholm Institute Board, operating under a Trust Deed approved other equipment. Travel and child care costs may also be covered by the Board and an operational agreement with the Board. where deemed appropriate. The Board of Trustees has an independent chair and comprises 2013 grants representatives from the broader Chisholm community, the Chisholm Institute Board and Chisholm Institute staff. They are responsible for In 2013 there were 185 scholarship recipients. Grants ranged from the governance of the Caroline Chisholm Education Foundation. $250 to $4600 and were awarded to students undertaking English as a second language, pre-apprenticeships and apprenticeships, The Trustees during 2013 were: Virginia Simmons (Chairperson), certificates, diplomas, advanced diplomas and degrees. Maria Peters, Kate Oxenbould (until September), Greg Hunt, David Willersdorf, Glen Kruger, Grant Radford (until September), Mandy Scholarships covered all courses and all students had an opportunity Splatt, Charles Wilkins, Natalie Millan, Helen Lechte and Matthew to apply from all campuses. Johnson.
Building Foundation funds Automotive Scholarship ANZ Bank Australian Communities Avaxa Scholarship The aim of the Foundation is to maintain a funding base of Foundation Berwick TEC Bursary $1,000,000 so that it can be self-supporting. Bendigo Bank SMP Project Building/Construction Scholarship Box Stallion Scholarship Casey and District Multiple Birth Distribution of Foundation grants Business Studies Scholarship Association Scholarship Chisholm Board of Directors’ Chisholm Staff Scholarship Grants are available to assist individuals and groups where social Scholarship or financial circumstances are impeding engagement in education City of Greater Dandenong and training. Access to funding is subject to eligibility according to Christmas Scholarship Scholarship the Foundation’s Grant Disbursement Principles and particular grant Community Health Scholarship Community Health Services guidelines. Construction/Plumbing Scholarship Scholarship Engineering/Manufacturing Emerson Scholarship Support scheme Scholarship FGB Natural Products Scholarship Fuji Xerox Scholarship Grenda Scholarship Many students need additional support to remain in education Grocon & VicUrban Scholarship Hardship Scholarship and professional support staff are selected to assist Foundation Hilton Manufacturing Hospitality Scholarship holders who are deemed at risk of withdrawal or having difficulties Ian Tatterson Scholarship Indigenous Scholarship with study. The staff provide additional advice and support so that scholarship holders can concentrate better on achieving positive Information Technology (Department of Human Services) study outcomes. Scholarship International Women’s Day KCG Scholarship, PCEA Scholarship Scholarship Fundraising and DVCEA Scholarship Killen Scholarship Leon Riley Scholarship (Rotary Marillal Ltd Fundraising events are an important aspect of Foundation activities. Club of Sorrento) Peter Wylie Memorial Bursary As well as lifting the profile of the Foundation in the local and wider Peninsula Community Legal Centre (Rotary Club of Lysterfield and community and expanding the number of donors and supporters, Rotary Berwick Scholarship Ferntree Gully) they give Chisholm staff an opportunity to get involved. Rotary Club of Endeavour Hills Rotary Club of Chelsea Scholarship The Foundation has an annual plan of fundraising events that Rotary Club of Rosebud Rotary Club of Frankston includes a Golf Day, International Women’s Day lunch and End of Year Scholarship Scholarship function. It also works in partnership with other organisations as Sue Polgar Memorial Scholarship Sandra George Manufacturing their Charity of Choice. Virginia Simmons Perpetual Industry Award (Perpetual) Scholarship Volkswagon Club Victoria Weblease
90 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 91 92 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation Declaration by the BOARD CHAIR, Chairperson and Chief Finance and Accounting Officer
We certify that the attached financial statement for the Caroline Chisholm Education Foundation (CCEF) has been prepared in accordance with Standing Direction 4.2 of the Financial Management Act 1994, applicable Financial Reporting Directions issued under that legislation, Australian Accounting Standards and other mandatory professional reporting requirements.
We further state that, in our opinion, the information set out in the comprehensive operating statement, balance sheet, statement of changes in equity, cash flow statement and notes to and forming part of the financial statement, presents fairly the financial transactions during the year ended 31 December 2013 and financial position of the Foundation as at 31 December 2013.
At the date of signing this financial statement, we are not aware of any circumstance that would render any particulars included in the financial statement to be misleading or inaccurate. There are reasonable grounds to believe that the Foundation will be able to pay its debts as and when they became due and payable.
The Authorised Trustees sign this declaration as delegates of, and in accordance with a resolution of, the Trustees of the Caroline Chisholm Education Foundation.
Stephen Marks Board Chair
26 February 2014 Dandenong
Virginia Simmons Chairperson
26 February 2014 Dandenong
Grant Radford Chief Finance and Accounting Officer
26 February 2014 Dandenong
Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 93 Comprehensive operating statement For the year ended 31 December 2013
2013 2012 Note $ $ Continuing operations Income from transactions Donations received from Chisholm 89,173 108,791 Donations received from other sources 241,363 177,392 Interest revenue 22,500 31,210 Resources received free of charge 103,305 90,562 Total income from transactions 456,341 407,955
Expenses from transactions Employee benefits 89,981 79,763 Scholarships 140,405 191,450 Administration charge 6,665 6,348 Audit fees 4 3,282 3,186 Consumables 4,911 4,249 Promotional expenses 14,551 13,262 Travel and motor vehicle charges 2,512 1,354 Other expenses 3,189 2,760 Total expenses from transactions 265,496 302,372
Net result from transactions 190,845 105,583
Comprehensive result 190,845 105,583
The above comprehensive operating statement should be read in conjunction with the accompanying notes.
94 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation B aLANCE sheet As at 31 December 2013
2013 2012 Note $ $ Assets Financial assets Cash and cash equivalents 740,852 770,798 Investment – term deposit 101,105 0 Receivables 168,345 48,330 Accrued income 1,622 1,951 Total financial assets 1,011,924 821,079
Total assets 1,011,924 821,079
Net assets 1,011,924 821,079
Equity Accumulated surplus/(deficit) 1,011,924 821,079 Total equity 1,011,924 821,079
Commitments 3 Contingencies 5
The above balance sheet should be read in conjunction with the accompanying notes.
Statement of changes in equity For the year ended 31 December 2013
2013 2012 Note $ $ Accumulated surplus/(deficit) Accumulated surplus/(deficit) at the beginning of the year 821,079 715,496 Comprehensive result for the year 190,845 105,583 Adjustment due to changes in accounting policy Accumulated surplus/(deficit) at the end of the year 1,011,924 821,079
Total equity at the end of the year 1,011,924 821,079
The above statement of changes in equity should be read in conjunction with the accompanying notes.
Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 95 Cash flow statement For the year ended 31 December 2013
2013 2012 Note $ $ Cash flows from operating activities Receipts Donations received from Chisholm 89,173 91,580 Donations received from other sources 121,348 182,372 Interest received 22,829 29,258 Total receipts 233,350 303,210
Expenditure Scholarships paid 140,405 191,450 Other expenses paid 21,786 19,610 Total expenditure 162,191 211,060
Net cash provided by/(used in) operating activities 2 71,159 92,150
Term deposit (101,105)
Net cash provided by/(used in) investment activities (101,105)
Net increase/(decrease) in cash and cash equivalents (29,946) 92,150
Cash and cash equivalents at the beginning of the financial year 770,798 678,647
Cash and cash equivalents at the end of the financial year 740,852 770,797
The above cash flow statement should be read in conjunction with the accompanying notes.
96 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation Notes to the financial statements For the year ended 31 December 2013
1. Statement of significant accounting policies
The financial statement is a general purpose financial statement which has been prepared on an accrual basis in accordance with the Financial Management Act 1994, applicable Australian Accounting Standards and Interpretations (AASs) and other mandatory professional requirements. AASs include Australian equivalents to International Financial Reporting Standards.
1.01 Basis of preparation
The following is a summary of the material accounting policies adopted by the Caroline Chisholm Education Foundation (CCEF) in the preparation of the financial statement. The accounting policies have been consistently applied unless otherwise stated.
Reporting basis and conventions
The financial statement has been prepared on a historical cost basis.
1.02 Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and cash at bank. For the purpose of the cash flow statement, cash and cash equivalents consist of cash and cash equivalents as defined above, net of bank overdrafts. Bank overdrafts are included in interest bearing liabilities in the balance sheet.
1.03 Receivables
Receivables consist entirely of amounts held by Chisholm on behalf of the CCEF. Receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective rate of interest method, less any accumulated impairment.
1.04 Revenue recognition
Donations received from Chisholm
Donations received from Chisholm are recognised as revenue in the period when the CCEF gains control of the donation. Control is recognised upon receipt. In accordance with the Operating Agreement between the CCEF and Chisholm, 5 per cent of interest earned by Chisholm is donated to the CCEF. Chisholm also donates income earned from fundraising activities it holds on behalf of the CCEF.
Donations received from other sources
Donations received from other sources are recognised as revenue in the period when the CCEF gains control of the donation. Control is recognised upon receipt of the donation. Donations received from other sources include donations from industry, the community and Chisholm staff.
Resources received free of charge
Resources received free of charge are recognised as revenue when the Foundation gains control of them. The benefits derived from these resources are recorded at their fair value in the financial statements. In accordance with the Operating Agreement between the CCEF and Chisholm, Chisholm is responsible for all operating expenses of the CCEF.
Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 97 Notes to the financial statements For the year ended 31 December 2013
Interest revenue
Interest revenue from cash, short term deposits and investments is brought to account on a time proportional basis taking into account interest rates applicable to the relevant financial assets.
1.05 Expenses
Employee benefits
Employee benefit expenses are recognised when incurred.
Scholarships
Scholarships are recognised as an expense when they are incurred.
Administration charge
The administration charge is recognised as an expense in the period when the amount becomes payable to Chisholm. In accordance with the Operating Agreement between the CCEF and Chisholm, 2 per cent of donation income is payable to Chisholm for administration of the CCEF accounts.
1.06 Commitments
Commitments include scholarships awarded to students for future years. Commitments are disclosed at their nominal values.
1.07 Contingent assets and liabilities
Contingent assets and liabilities are not recognised in the balance sheet, but are disclosed by way of a note and, if quantifiable, are measured at nominal value. Contingent assets and liabilities are presented inclusive of GST receivable or payable.
2. Cash flow information
2013 2012 $ $ Reconciliation of operating result to cash flows from operating activities Net operating result for the year 190,845 105,583
Change in operating assets and liabilities Income accrued 329 (1,951) Decrease/(increase) in receivables (120,015) (11,482) Net cash flows from operating activities 71,159 92,150
3. Commitments
2013 2012 $ $ Scholarship Outstanding scholarships are payable as follows: Payment due Not later than one year 9,720 8,342 Later than one year and not later than five years 9,720 8,342
98 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation Notes to the financial statements For the year ended 31 December 2013
4. Auditor’s remuneration
In accordance with the Operating Agreement between the CCEF and Chisholm, Chisholm is responsible for audit expenses.
2013 2012 $ $ Victorian Auditor-General’s Office Audit of the financial statement 3,282 3,186
5. Contingencies
At balance date, the Foundation had no contingent assets or contingent liabilities (2013: Nil).
6. key management personnel disclosures
In accordance with the directions of the Minister for Finance under the Financial Management Act 1994, the following disclosures are made for the responsible Ministers and responsible Members of Council.
(i) Minister
The relevant Minister is the Hon. Peter Hall MP, Minister for Higher Education and Skills. Remuneration of the Ministers is disclosed in the financial statement of the Department of Premier and Cabinet. Other relevant interests are declared in the Register of Members’ Interests, which is completed by each member of the Parliament.
(ii) Trustees of the Caroline Chisholm Education Foundation
The following persons were responsible persons and Trustees of the Foundation during the year:
Name Category of appointment Relevant period Virginia Simmons Chairperson 01/01/2013 – 31/12/2013 Maria Peters Trustee 01/01/2013 – 31/12/2013 Grant Radford Trustee 01/01/2013 – 02/08/2013 Matt Johnston Trustee 02/08/2013 – 31/12/2013 Kate Oxenbould Trustee 01/01/2013 – 02/08/2013 Greg Hunt Trustee 01/01/2013 – 31/12/2013 David Willersdorf Trustee 01/01/2013 – 31/12/2013 Charles Wilkins Trustee 01/01/2013 – 31/12/2013 Mandy Splatt Trustee 02/08/2013 – 31/12/2013 Natalie Millan Trustee 02/08/2013 – 31/12/2013 Glen Kruger Trustee 02/08/2013 – 31/12/2013 Helen Lechte Trustee 02/08/2013 – 31/12/2013
(iii) Remuneration of Trustees
Trustees are not remunerated for carrying out their duties in their capacity as a Trustee.
Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 99 Notes to the financial statements For the year ended 31 December 2013
7. Related parties
2013 2012 $ $ Debtor – Chisholm 168,345 48,330 168,345 48,330 Intercompany revenue Donations 89,173 108,791 Resources provided free of charge 103,305 90,562 192,479 199,353 Intercompany expenditure Administration charge 6,665 6,348 6,665 6,348
8. Financial instruments
Terms, conditions and accounting policies
CCEF’s accounting policies, including the terms and conditions of each class of financial asset, financial liability and equity instrument, both recognised and unrecognised at reporting date, are as follows:
Recognised financial instruments Note Accounting policies Terms and conditions Financial assets Cash and cash equivalents – deposits at 1.02 Deposits at call are carried at their Deposits at call have an effective interest call nominal amounts. Interest revenue rate of 2.7% is recognised in the operating statement when it is earned. Receivables 1.03 Related party receivable is carried at Related party receivable the nominal amount. Investments Term deposits are held for 12 months Term deposits fixed interest rate at 3.6%
(a) Financial instrument compositions and maturity analysis
The tables below reflect the undiscounted contractual settlement terms for financial instruments of a fixed period of maturity, as well as management’s expectations of the settlement period for all other financial instruments. Additionally, the total amount of financial assets disclosed excludes statutory receivables. Due to the aforementioned factors, the amounts below may not reconcile to the balance sheet.
2013 Weighted average Floating interest Non-interest Total carrying effective rate rate $ bearing $ amount $ Financial assets Cash and cash equivalents Deposits 2.73% 740,852 740,852 Investments Term deposits 3.66% 101,105 101,105 Receivables Related party receivable 168,345 168,345 Other receivable 1,622 1,622 Total financial assets 841,957 169,967 1,011,924
100 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation Notes to the financial statements For the year ended 31 December 2013
Weighted Floating Non- interest Total carrying average interest rate bearing amount 2012 effective rate $ $ $ Financial assets Cash and cash equivalents 770,798 770,798 Deposits 4.29% Receivables Related party receivable 48,330 48,330 Total financial assets 770,798 48,330 819,128
(b) Sensitivity analysis
The following table summarises the sensitivity of the Foundation’s financial assets and financial liabilities to interest rate risk:
Interest rate risk -0.50% +1.00% Carrying amount Result Equity Result Equity 31 December 2013 $ $ $ $ $ Financial assets Cash and cash equivalents 841,957 (4,209) (4,209) 8,419 8,419 Total increase/(decrease) 841,946 (4,209) (4,209) 8,419 8,419
Interest rate risk -0.50% +1.00% Carrying amount Result Equity Result Equity 31 December 2012 $ $ $ $ $ Financial assets Cash and cash equivalents 770,798 (3,854) (3,854) 7,708 7,708 Total increase/(decrease) 770,798 (3,854) (3,854) 7,708 7,708
9. Fair value
The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes.
Due to the short term nature of the receivables, their carrying value is assumed to approximate their fair value. Receivables that are neither past due nor impaired will be received when due.
10. Financial risk management
Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument is disclosed in Note 1 of the financial statements.
Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation 101 Notes to the financial statements
For the year ended 31 December 2013
(i) Financial risk management objectives
The Foundation’s activities only expose it to interest rate risk. The Foundation relies on Chisholm’s treasury function to monitor interest rates and minimise potential adverse effect on the financial performance of the CCEF by adhering to Chisholm’s Investment Strategy parameters.
(ii) Financial risk exposures and management
The Foundation’s financial instruments consist of deposits at call and a related party receivable. The main risk to the Foundation is exposed to through its financial instruments is interest rate risk.
11. Interest rate risk
Interest rate risk arises from the potential for a change in interest rates to change the expected net interest earnings in the current reporting period and in future years. Similarly, interest rate risk also arises from the potential for a change in interest rates to cause a fluctuation in the fair value of the financial instruments.
The objective is to manage the rate risk to achieve stable and sustainable net interest earnings in the long term. This is managed predominately through a mixture of short term and longer term investments with AA rated banking institutions.
The Foundation’s exposure to interest rate risks and the effective interest rates of financial assets and financial liabilities, both recognised and unrecognised at balance date, are set out in the financial instrument compositions and maturity analysis table.
12. Credit risk
Credit risk refers to the risk that a counter party will default on its contractual obligations resulting in a loss to Chisholm.
There is no credit risk to the related party receivable.
102 Chisholm Institute Annual Report 2013 – Caroline Chisholm Education Foundation Activity table
The activity table is provided for National Financial Reporting purposes. The information provided in this statement is reporting on the same basis as the financial information reported in the audited Financial Report for Chisholm Institute for the year ended 31 December 2013.
Statement 1 – Operating expenses
2013 2012 $’000 $’000 Total operating expenses Delivery provision and support activity 61,150 77,737 Administration and general services activity 18,924 26,025 Property, plant and equipment services activity 18,350 18,819 Student and other services activity 6,322 6,842 Total operating expenses 104,745 129,423
Statement 2 – Delivery provision and support activity
Delivery provision and support activity Salaries, wages, overtime and allowances 45,561 60,717 Superannuation 3,972 5,320 Payroll tax 2,460 3,449 Other salary related costs 947 1,075 Consumables 3,161 3,700 Travel and motor vehicle expenses 879 416 Depreciation 2,277 2,389 Other direct delivery expenses 1,893 670 Delivery provision and support activity 61,150 77,737
Statement 3 – Administration and general services activity
Administration and general services activity Salaries, wages, overtime and allowances 6,844 13,459 Superannuation 469 616 Payroll tax 247 349 Other salary related costs (360) (171) Consumables 223 312 Communication expenses 1,089 1,296 Fees 5,736 4,360 Travel and motor vehicle expenses 875 1,975 Depreciation 438 460 Other expenses 3,363 3,369 Administration and general services activity 18,924 26,025
Chisholm Institute Annual Report 2013 103 Activity table
Statement 4 – Property, plant and equipment services activity
2013 2012 $’000 $’000 Property, plant and equipment services activity Salaries, wages, overtime and allowances 975 1,279 Superannuation 94 117 Payroll tax 53 68 Other salary related costs 21 13 Consumables 87 116 Depreciation 4,129 4,331 Equipment 555 1,365 Energy costs 1,755 1,759 Contract services 6,569 5,792 Rent/leasing charges 1,636 1,572 Repair and maintenance 2,477 2,374 Loss on sale of non-current assets (7) 24 Other expenses 6 9 Property, plant and equipment services activity 18,350 18,819
Statement 5 – Student and other services activity
Student and other services activity Salaries, wages, overtime and allowances 5,015 4,859 Superannuation 438 402 Payroll tax 269 267 Other salary related costs 81 54 Consumables 245 359 Depreciation 15 16 Other expenses 258 886 Student and other services activity 6,322 6,842
104 Chisholm Institute Annual Report 2013 2013 financial performance against the 2013 budget
The Board approves an Annual Budget consistent with financial obligations stated in its governance approaches, the Constitution, the Education and Training Act and other statutory directions. The 2013 Budget was originally approved by the Board on 5 December 2012. A revision to the Budget was approved on 12 September 2013. Chisholm’s performances against the financial targets specified in the 2013 Revised Budget are summarised as follows:
2013 Actual 2013 Revised budget Variance Note $’000 $’000 $’000
Operating Income 116,608 109,478 7,130 1
Operating Expenses 2 (97,338) (101,672) 4,334
EBITDA 19,270 7,806 11,464
Capital operations 3 11,397 11,692 (295)
Net surplus 30,667 19,498 11,169
Working capital balance 4 36,920 23,666 13,254
Notes 1. Operating income was higher than budget due to higher than anticipated training to eligible students. 2. The decrease in operating expenses largely results from cost cutting strategies employed by Chisholm. 3. Capital operations includes government contributions – capital, depreciation and expenditures from capital contributions. 4. Working capital is equal to current assets less current liabilities (excluding long term employee provisions).
2013 - 2015 Targets
Chisholm 2013 Targets 2013 Progress Report 5% growth in government The target of 5% growth in government funded programs was 7,037,126 SCH. The funded SCH per annum final result of 7,495,577 attended SCH is 106.5% of the set target
1% increase in learners 50.6% of students enrolled in a subsequent course in 2013. This represents a 12.6% undertaking a subsequent overachievement against a target of 38% course per annum 10% growth in tertiary Tertiary program student numbers increased by 58% for VET programs and 26.7% for program student numbers per HE programs. The number of students in each program was 8292 (VET) and 147 (HE) annum against a target of 5248 and 116 respectively 10% growth in commercial Commercial revenue was $26.50m. This is 5.1% higher than the set target of revenue per annum $25.21m 1 average point increase Student satisfaction was 74% compared to a target of 76% representing a decrease in student satisfaction per of 2.6% annum Achieve a 6% surplus per The Institute achieved a $19.27m operating surplus and operating revenue of annum, exclusive of re- $116.61m investment 5% increase in staff rating 15.8 % of staff rated Chisholm as excellent in the Chisholm staff satisfaction survey. Chisholm as an excellent This represents a 2.6% overachievement against a target of 15.4% place to work
Chisholm Institute Annual Report 2013 105 Disclosures index and additional compliance reports
Introduction
The Annual Report is the only medium through which Chisholm Institute discharges its accountability to the Parliament, government and the people of Victoria. This index is provided to assist readers of the 2013 Annual Report to identify how Chisholm has met reporting obligations specified in:
• Financial Management Act 1994 (FMA)
• Financial Reporting Directions (FRDs)
• Standing Directions (SDs) of the Minister for Finance issued under the Financial Management Act 1994
• Education and Training Reform Act 2006 (ETRA)
• TAFE institute Commercial Guidelines (CG)
• Public Accounts and Estimates Committee (PAEC) and Victorian Auditor General’s Office (VAGO) - June 2003 Special Review item 3.110 – Overseas Operations of Victorian TAFE Institute
• Other relevant legislation listed in the disclosure index
Questions or comments can be addressed to: The Chief Operating Officer Chisholm Institute 121 Stud Road Dandenong Vic 3175 T: +61 3 9212 5259 E: [email protected]
106 Chisholm Institute Annual Report 2013 Disclosures index and additional compliance reports
This section of the 2013 Annual Report includes:
Page number Disclosures index 108 – 111 The index of compliance reports, which provides: • a list identifying the relevant clauses of Victorian legislation with statutory |disclosure requirements • a short description of the relevant requirement • details of the page number(s) where this Report provides the relevant details for Chisholm Institute.
Additional information and reports not otherwise included in the 2013 Page number Annual Report, including:
• Application of the Freedom of Information Act 1982 113 • Application of the Protected Disclosure Act 2012 122 • Assets received without due consideration 113 • Compliance with the Building Act 1993 114 • Engagement of consultants 116 • Environmental performance 118 • External reviews 112 • Financial Management Compliance Framework 122 • Formation and objectives of the Board of Chisholm Institute 23 • Formation and objectives of the Caroline Chisholm Education Foundation 124 • People and development report 17 • National Competition Policy 124 • Prices, fees, charges, rates and levies charged by Chisholm Institute. 126
Chisholm Institute Annual Report 2013 107 Disclosures index
Item Source SUMMARY OF REPORTING REQUIREMENT Identify relevant page(s) No reference in your Annual Report Important Note: please refer to the individual FRD, SD or CG for full detail of requirements (see weblinks shown at top of this If not applicable to your document) as the information provided below is a summary only institute, do not leave blank, write “n/a”
REPORT OF OPERATIONS
CHARTER AND PURPOSE 1 FRD 22D Manner of establishment and the relevant Minister 5, 23 2 FRD 22D Objectives, functions, powers and duties 23 3 FRD 22D Nature and range of services provided including communities served 23, 5 – 16 MANAGEMENT AND STRUCTURE 4 FRD 22D Organisational structure and chart, including accountabilities 24 – 27 5 FRD 22D Names of Board members 20 – 21, 24, 26, 74 FINANCIAL AND OTHER INFORMATION 6 FRD 03A Accounting for Dividends NA 7 FRD 07A Early adoption of authoritative accounting pronouncements 56 – 58 8 FRD 10 Disclosure Index 107 – 111 9 FRD15B Executive officer disclosures 22, 75 – 76 10 FRD 17A Long Service leave wage inflation and discount rates 53 11 FRD19 Private provision of public infrastructure NA 12 FRD 20A Accounting for State motor vehicle lease arrangements prior to 1 Feb 2004 NA 13 FRD22 Operational and budgetary objectives, performance against objectives and 32 – 34, 88, 105 & SD 4.2(k) achievements 14 FRD 22D Occupational health and safety statement including performance indicator and 29 performance against those indicators 15 FRD 22D Workforce data for current and previous reporting period including a statement 17 on employment and conduct principles 16 FRD 22D Summary of the financial results for the year including previous 4 year 32 – 34 comparisons 17 FRD 22D Significant changes in financial position during the year 34 18 FRD 22D Major changes or factors affecting performance 105 19 FRD 22D Post-balance sheet date events likely to significantly affect subsequent 73 reporting periods 20 FRD 22D Summary of application and operation of the Freedom of Information Act 1982 113 21 FRD 22D Statement of compliance with building and maintenance provisions of the 114 – 115 Building Act 1993 22 FRD 22D Statement on National Competition Policy 124 23 FRD 22D Summary of application and operation of the Protected Disclosure Act 2012 122 24 FRD 22D Summary of Environmental Performance. 119 – 121 25 FRD 22C Details of consultancies over $10,000 (refer to FRD for information required) 116 – 118 26 FRD 22C Details of consultancies under $10,000 (refer to FRD for information required) 118
108 Chisholm Institute Annual Report 2013 Disclosures index
Item Source SUMMARY OF REPORTING REQUIREMENT Identify relevant page(s) No reference in your Annual Report Important Note: please refer to the individual FRD, SD or CG for full detail of requirements (see weblinks shown at top of this If not applicable to your document) as the information provided below is a summary only institute, do not leave blank, write “n/a”
27 FRD 22D List of certain other information available on request (as specified in the FRD) 112 28 FRD 24C Reporting of office based environmental impacts 120 – 121 29 FRD 25A Victorian Industry Participation Policy Disclosures 123 30 FRD 26A Accounting for VicFleet motor vehicle lease arrangements on or after 1 NA February 2004 31 FRD 29 Workforce Data Disclosures on the public service employee workforce NA 32 FRD30A Standard requirements for the design and print of annual reports 4 33 SD 4.5.5 Risk Management compliance attestation 28 34 SD 4.2 (g) Qualitative and Quantitative information to be included 4 – 16 35 SD 4.2 (h) Statement that Report prepared in accordance with Financial Reporting 4 Directions 36 SD 4.2 (j) Sign-off by member of Responsible Body 6 37 CG 10 Major Commercial Activities 115 (clause 27) 38 CG 12 Controlled Entities 44 (clause 33) FINANCIAL REPORT FINANCIAL STATEMENTS REQUIRED UNDER PART 7 OF THE FINANCIAL MANAGEMENT ACT 1984 39 SD 4.2 (a) The financial statements must be prepared in accordance with: Australian accounting standards (AAS and AASB standards) and other 37 mandatory professional reporting requirements (including urgent issues group 37 consensus views); 37 Financial Reporting Directions; and business rules. 40 SD 4.2 (b) The financial statements are to comprise the following: 38 income statement; 39 balance sheet; 60 – 62 statement of recognised income and expense; and 41 cash flows statement; and 42 – 84 notes to the financial statements. OTHER REQUIREMENTS UNDER STANDING DIRECTION 4.2 41 SD 4.2 (c) The financial statements must where applicable be signed and dated by the Accountable Officer, CFAO and a member of the Responsible Body, stating whether, in their opinion: 37 the financial statements present fairly the financial transactions during the reporting period and the financial position at the end of the period; 37 the financial statements are prepared in accordance with this direction and applicable Financial Reporting Directions; and 37 the financial statements comply with applicable Australian accounting standards (AAS and AASB standards) and other mandatory professional reporting requirements (including urgent issues group consensus views).
42 SD 4.2 (d) Rounding of amounts. 54
Chisholm Institute Annual Report 2013 109 Disclosures index
Item Source SUMMARY OF REPORTING REQUIREMENT Identify relevant page(s) No reference in your Annual Report Important Note: please refer to the individual FRD, SD or CG for full detail of requirements (see weblinks shown at top of this If not applicable to your document) as the information provided below is a summary only institute, do not leave blank, write “n/a”
43 SD 4.2 (e) Review and sign off by Audit Committee or responsible body 37 44 SD 4.2 (f) Compliance with DTF Model Financial report 4 OTHER REQUIREMENTS AS PER FINANCIAL REPORTING DIRECTIONS IN NOTES TO THE FINANCIAL STATEMENTS 45 FRD 9A Disclosure of administered assets and liabilities NA 46 FRD 11 Disclosure of ex-gratia payments 71 47 FRD 21B Disclosures of Responsible Persons, Executive Officer and Other Personnel (Contractors with significant management responsibilities) in the Financial 74 – 77 Report 48 FRD 101 First time adoption 55 49 FRD 102 Inventories 50, 63 50 FRD 103D Non-current physical assets 46, 50 – 51, 64 – 66 51 FRD 104 Foreign currency 54 52 FRD 105A Borrowing costs NA 53 FRD 106 Impairment of assets 47 – 48 54 FRD 109 Intangible assets 46, 52, 67 55 FRD 107 Investment properties NA 56 FRD 110 Cash flow statements 41, 71 57 FRD 112C Defined benefit superannuation obligations 45 – 46, 73 58 FRD 113 Investment in subsidiaries, jointly controlled entities and associates 44, 77 59 FRD 114A Financial instruments – general government entities and public non-financial 47, 78 – 84 corporations 60 FRD 115 Non-current physical assets – first time adoption NA 61 FRD 119 Contributions by owners 40, 70 62 FRD 119A Transfers through contributed capital NA 63 FRD 120G Accounting and reporting pronouncements applicable to the reporting period 43, 56 – 58 64 FRD 121 Infrastructure assets NA PART 7 OF THE FINANCIAL MANAGEMENT ACT 1994 (FMA) 65 FMA 49 (a) Must contain such information as required by the Minister. 37 66 FMA 49 (b) Must be prepared in a manner and form approved by the Minister. 37 67 FMA 49 (c) Must present fairly the financial transactions of an institute during the financial 37 year to which they relate. 68 FMA 49 (d) Must present fairly the financial position of an institute as at the end of the 37 year. 69 FMA 49 (e) Must be certified by the Accountable Officer for an institute in the manner 37 approved by the Minister.
110 Chisholm Institute Annual Report 2013 Disclosures index
Item Source SUMMARY OF REPORTING REQUIREMENT Identify relevant page(s) No reference in your Annual Report Important Note: please refer to the individual FRD, SD or CG for full detail of requirements (see weblinks shown at top of this If not applicable to your document) as the information provided below is a summary only institute, do not leave blank, write “n/a”
COMPLIANCE WITH OTHER LEGISLATION AND SUBORDINATE INSTRUMENTS 70 Legislation The TAFE institute Annual Report must contain a statement that it complies with all relevant legislation and subordinate instruments, including, but not 106, 112 limited to, the following: Education and Training Reform Act 2006 (ETRA) 23, 112 TAFE institute constitution 23, 112 Directions of the Minister for Higher Education and Skills (or predecessors) 4, 112 TAFE institute Commercial Guidelines 4, 112 TAFE institute Strategic Planning Guidelines 4, 112 Public Administration Act 2004 17, 112 Freedom of Information Act 1982 113, 112 Building Act 1983 114 – 115, 112 Protected Disclosure Act 2012 122, 112 Victorian Industry Participation Policy Act 2003 123, 112 71 ETRA Statement about compulsory non-academic fees, subscriptions and charges 125 s 3.2.8 payable in 2013. PRESENTATION OF REPORTING AND PERFORMANCE INFORMATION Audited Statements of Key Performance Measures (KPIs) must include an audited statement of performance for certain KPIs. 72 FRD 27B Reporting and performance should be presented using KPIs and a signed Performance Management Certificate should also be completed. 87 – 88 (The following 11 are the mandatory KPIs) Participation of 15-24 year olds. Participation of 25-64 year olds. Module Load Completion Rate. Student satisfaction. Total Cost per Student Contact Hour (SCH). Working Capital Ratio. Net Operating Margin. Fee for Service Revenue. Revenue per EFT Staff. Student Contact Hours (SCH). Energy Consumption. OVERSEAS OPERATIONS OF VICTORIAN TAFE INSTITUTES 73 PAEC and financial and other information on initiatives taken or strategies relating to the 12, 15, 60, 78 – 82 VAGO institute’s overseas operations. (June 2003 nature of strategic and operational risks for overseas operations; Special Review strategies established to manage such risks of overseas operations; item 3.110) performance measures and targets formulated for overseas operations; the extent to which expected outcomes for overseas operations have been achieved.
Chisholm Institute Annual Report 2013 111 Additional information available on request
Consistent with the requirements of the Financial Management Act 1994, Chisholm has prepared materials on the following topics, which are available on request:
• statements regarding declarations of pecuniary interest • details of publications produced by Chisholm Institute and the places where publications can be obtained • details of research and development activities undertaken by Chisholm Institute • details of overseas visits undertaken, including a summary of the objectives and outcomes of each visit • details of promotional, public relations and marketing activities undertaken by Chisholm Institute to develop community awareness of the Institute and the programs and services provided • details of major committees sponsored by Chisholm Institute and the extent to which their purposes have been achieved • details of major external reviews • details of changes in prices, fees, charges, rates and levies charged by the entity • details of all consultancies and contractors including consultants/contractors engaged; services provided; and expenditure committed for each engagement.
Enquiries regarding this information should be directed to: The Chief Operating Officer Chisholm Institute PO Box 684 Dandenong Vic 3175 T: +61 3 9212 5259 E: [email protected]
COMPLIANCE WITH OTHER LEGISLATION AND SUBORDINATE INSTRUMENTS
Chisholm Institute complies with all relevant legislation and subordinate instruments, including, but not limited to, the following:
• Education and Training Reform Act 2006 (ETRA) • TAFE institute constitution • Directions of the Minister for Higher Education and Skills (or predecessors) • TAFE institute Commercial Guidelines • TAFE institute Strategic Planning Guidelines • Public Administration Act 2004 • Freedom of Information Act 1982 • Building Act 1983 • Protected Disclosure Act 2012 • Victorian Industry Participation Policy Act 2003.
112 Chisholm Institute Annual Report 2013 Application of the Freedom of Information Act 1982
Chisholm Institute has implemented procedures which, subject to privacy and confidentiality provisions, facilitate all reasonable requests for information from students, staff and the general public without recourse to the Freedom of Information Act 1982.
General enquiries about Chisholm Institute should be addressed to: Chisholm Institute PO Box 684 Dandenong Vic 3175 or visit www.chisholm.edu.au.
All Freedom of Information requests should be forwarded to: The Freedom of Information Officer Chisholm Institute PO Box 684 Dandenong Vic 3175.
Chisholm Institute may levy a charge for information provided that is subject to a Freedom of Information request in accordance with the Freedom of Information (Access Charges) Regulation 2004.
During the year ended 31 December 2013, Chisholm received one application for access to documentary information under Section 17 of the Freedom of Information Act 1982.
Assets received without due consideration
Chisholm Institute receives financial support from industry and the community in the form of donated assets and materials provided at no cost.
During 2013, these donations took the form of:
• cash donations received by Chisholm for the Caroline Chisholm Education Foundation • equipment, furniture and fittings and other consumable materials donated to Chisholm Institute that assist in the provision of apprenticeship programs and the delivery of other programs • additional supplier price discounts for equipment purchased for training purposes • cash and materials donations specifically for student award presentations.
Contributions of resources received free of charge or for nominal consideration are recognised at their fair value when the contributed asset qualifies for recognition, unless received from another government department or agency as a consequence of a restructuring of administrative arrangements. In which case, such transfer will be recognised at carrying value. Contributions in the form of services are only recognised when a fair value can be reliably determined and the services would have been purchased if not donated.
Chisholm Institute Annual Report 2013 113 Compliance with the Building Act 1993
General statement
Chisholm Institute holds all plans and documentation for building extensions and new buildings lodged for issue of building approvals by certified building surveyors. Upon completion of construction, the Institute has obtained Certificates of Occupancy and practical completion certificates from the relevant architects and surveyors.
Assurance programs
Certification of The architects provided completion certificates and necessary building compliance and regulatory building projects certificates were received for all projects completed.
Building maintenance Chisholm Institute has an ongoing maintenance program (using Institute staff and engagement programs of specialist external contractors) for works to the existing buildings controlled by Chisholm.
Compliance statement It is considered that all buildings on campus currently conform to the Building Regulations as existed at the time of construction of the respective buildings. All new buildings constructed since the promulgation of the Building Act 1993 comply with those relevant standards. Chisholm Institute has an ongoing program to ensure that any alterations or improvements to buildings meet the necessary standards to ensure that they are safe and fit for purpose.
For the year ended 31 December 2013, progress towards full compliance with the Building Act 1993 is summarised as follows:
Building works 2013 2012 2011 2010 2009 New buildings certified for approval 0 0 0 3 2 Works in progress subject to mandatory inspections 3a 0 0 3 1 New occupancy permits issued 0 0 4 3 3 Maintenance Notices issued for substandard buildings requiring urgent attention 0 0 0 0 0 Other notices issued involving major expenditure and urgent 0 0 0 0 0 attention Conforming Number of owned buildings Frankston 17b 17 17 17 17 occupied by Chisholm Dandenong 27c 27 27 25 25 (Note the numbers are buildings in Berwick 9 9 9 8 6 their entirety; floors and levels have not been considered.) Cranbourne 5 5 5 4 3 Bass Coast 4 4 5 4 3 Mornington Peninsula 6 6 6 6 6 Total 69 69 69 64 60 Number of buildings conforming to the above standards 69 69 69 64 60 Number of non-conforming buildings vacated 0 0 0 0 0 Number of buildings not conforming to standards Refer to Subdivision Statement
Note: a. Frankston campus Trade Training Centre (START), Mornington Peninsula campus Trade Training Centre, Berwick campus Trade Careers Centre. b. Institute buildings J, K and L and buildings F, G and H at Frankston are counted as one building. c. Institute buildings R and S are counted as one building.
114 Chisholm Institute Annual Report 2013 Compliance with the Building Act 1993
Subdivision 1 of the Building Regulations is related to all new buildings or section of existing buildings altered after 1 July 1994. There are approximately eight buildings out of the 69 that are considered to be Subdivision 1 type buildings. All buildings are issued with an Annual Essential Safety Measures Report.
Subdivision 2 relates to all buildings constructed or altered prior to 1 July 1994. All Subdivision 2 buildings have been provided with a maintenance determination in accordance with Part 1215 of the Building Regulations, which requires all buildings to be provided with this document and subsequent Annual Essential Safety Measures Reports prior to 13 June 2009.
Building works undertaken by Chisholm during the year ended 31 December 2013 were as follows:
• partial implementation of disability access rectification works across all campuses for high priority compliance issues • quarterly inspections completed by an accredited external consultant to ensure that all essential service requirements are met for the safety of occupants.
Report on Major Commercial Activity There was no other Major Commercial Activity conducted by Chisholm in this reporting period.
Chisholm Institute Annual Report 2013 115 Engagement of consultants
The Financial Management Act 1994 defines a consultant as a person who or an organisation which: • provides specialised analysis and advice to facilitate decision making • performs a one-off task or set of tasks • performs a function involving skills or specialised knowledge not available within the Institute.
During the year ended 31 December 2013, Chisholm: • engaged 39 consultants costing more than $10,000; details are as follows:
Approved 2013 Future expenditure expenditure commitments Consultant Project (exc. GST) (exc. GST) (exc. GST) AECOM AUSTRALIA PTY LTD Assessment of report of $10,420 $10,420 $0 ESCO request for proposal; tenderers APTUS INTERNATIONAL STRATA redesign consulting $154,587 $139,388 $13,365 SERVICES PTY LTD AVAXA PTY LTD STRATA support and $639,246 $512,815 $54,290 maintenance BEVINGTON CONSULTING PTY Quality management system $415,495 $216,020 $221,182 LTD T/A BEVINGTON GROUP design and development consulting BRIDGE CONSULTING & Placement fee for HR $12,084 $0 $0 RECRUITMENT PTY LTD operation BUREAU OF TOURISM Building audit for reporting $21,835 $21,135 $770 RESEARCH on asbestos CONSIDERED COMPLIANCE Memorandum of $32,727 $32,900 $4,290 SERVICES PTY LTD Understanding and sponsorship guidelines/ templates DG TRAINING SOLUTIONS Services TVET skills upgrade $19,035 $26,236 $0 DIMENSION DATA LEARNING Dimension Data technical $45,023 $30,674 $14,349 SOLUTIONS consultant time FAST TRACK LEADERSHIP Business case development $10,909 $16,545 $0 PTY LTD for Chisholm @ 311 FIVE CONSULTING PTY LTD Develop and complete a $36,975 $36,975 $0 Department of Treasury and Finance compliant business case FOOKS MARTIN SANDOW Southern Peninsula Trade $130,322 $130,322 $0 ANSON PTY LTD Centre design consulting FUSION5 PTY LTD Statement of works – $46,754 $18,300 $18,590 HEAT 2013 FYB PTY LTD Review of records $142,650 $22,200 $117,381 GRAY PUKSAND PTY LTD Architecture and interior $284,451 $284,451 $0 design – START
116 Chisholm Institute Annual Report 2013 Engagement of consultants
Approved 2013 Future expenditure expenditure commitments Consultant Project (exc. GST) (exc. GST) (exc. GST) ADMAR DIRECTIONS T/A HERO Visual media and branding $124,748 $88,815 $9,304 CREATIVE consulting HR RESPONSE HR consulting $16,200 $16,200 $0 THE BYJOEL TRUST Chisholm organisational $116,150 $45,750 $59,125 redesign LANDER & ROGERS Workplace relations and $19,396 $42,752 $0 safety consulting M P CORDIA & ASSOCIATES Condition audit and $189,500 $189,500 $0 PTY LTD maintenance planning Southern Peninsula Trade Centre MAVERICK ROSE PTY LTD T/AS Customer engagement $357,000 $210,000 $154,000 SAGACITY CONSULTING project MERCER CONSULTING Chisholm remuneration $31,290 $31,290 $0 (AUSTRALIA) PTY LTD review PATRICIA CULLIT BTCC project coordination $100,000 $74,000 $76,900 PFJ EDUCATIONAL SERVICES Educational services Africa $90,612 $90,612 $0 PTY LTD TVET reform PHILLIPS KPA PTY LTD Frankston redevelopment $61,182 $61,182 $0 project design consulting POINT PROJECT MANAGEMENT Project management - BTCC $84,146 $84,146 $0 PTY LTD PRICEWATERHOUSECOOPERS Business case for Chisholm $32,175 $32,175 $0 @ 311 and financial modelling PROFESSIONAL MENTORING & International review $22,800 $22,800 $0 COACHING SERVICES REACTIVE MEDIA PTY LTD HACC project web interface $275,644 $376,820 $3,500 development RESOLUTIONS CONSULTING Employee assistance $18,611 $20,052 $1,720 SERVICES VIC PTY LTD program and career transition group training
SIMON WALLACE Technical advice and $19,245 $19,245 $0 expenses TVET Africa teacher skills program SIRSIDYNIX PTY LTD Technical advice to SCA $12,990 $12,990 $0 TVET TENDERCARE MEAT Project management $20,754 $20,754 $0 services; trainers of trainers Ethiopian TVET THE NOUS GROUP PTY LTD Chisholm organisational $41,372 $25,436 $18,080 redesign TIM BEDOHAZY T/A TM&L Chisholm online $154,500 $154,500 $0 CONSULTING development and consulting V LEARNING PTY Development of six SCORM $30,000 $30,000 $0
Chisholm Institute Annual Report 2013 117 Engagement of consultants
Approved 2013 Future expenditure expenditure commitments Consultant Project (exc. GST) (exc. GST) (exc. GST) VINCENT CHRISP & PARTNERS Architectural services - $205,390 $205,390 $0 PTY LTD DREAM and BTCC VIRSIS CONSULTING Education consultancy $29,425 $29,425 $0 services Africa TVET teacher skills program WATEROPS TRAINING Water operations $38,182 $16,200 $25,800 consultancy
• Engaged other 55 consultants, each costing less than $10,000. The total costs of these consultancies were $160,936 (ex GST).
Environmental performance Sustainability can be described as the interconnectedness of a healthy environment, social justice, equity and economic vitality so that the quality of human life is improved while living within the carrying capacity of supporting ecosystems.
Chisholm seeks to integrate sustainability principles into all aspects of the organisation so that it is recognised as a leader in the design and delivery of sustainable education and training for social, environmental and economic prosperity, and understanding through lifelong education, training and community capacity building.
Chisholm recognise its own sustainability is interconnected with the sustainability of its activities, which require coherence and congruence between sustainability, education delivery and assessment, campus operations and development, values, policy and procedures, behaviour and culture.
Chisholm’s core business is vocational education and training and the direct environmental impacts of this have been identified and targets created relating to greenhouse gas emissions, energy, water, waste, onsite renewable generation, GreenPower purchase, embedding sustainability into Institute business and education. Further to this Chisholm is committed to actions relating to green procurement and education for sustainability, which will support the Chisholm 2020 target of 50 per cent reduction in the Chisholm sustainability index.
Key sustainability priorities for 2013 included the following:
ResourceSmart Strategy
The Chisholm ResourceSmart Strategy covers the following targets, relative to 2007 (base year):
Target (baseline 2007) 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Emission reduction -15% -20% -25% -30% -35% -40% -43% -45% -48% -50% Energy reduction -15% -20% -25% -30% -35% -40% 43% -45% -48% -50% GreenPower purchase 20% 20% 25% 30% 35% 40% 45% 50% 55% 60% Renewable generation 5% 8% 10% 12% 15% 18% 20% 25% 28% 30% Water reduction -15% -25% -35% -55% -65% -70% -75% -80% -85% -90% Waste recycling 25% 35% 45% 50% 55% 60% 65% 70% 75% 80%
The Chisholm ResourceSmart Strategy not only covers the above but also green purchasing, built environment design, transportation, education for sustainability, and embedding of sustainability throughout the business.
118 Chisholm Institute Annual Report 2013 Environmental performance
Environmental Sustainability Index
The Environmental Sustainability Index aligns with ResourceSmart strategy targets and is calculated using weighted emissions, energy and water consumption against students (EFTSL) plus staff (EFT). This single measure enables Chisholm to take a holistic view of sustainability.
A summary of the index follows:
Chisholm Environmental Sustainability Index 2010–2014
Year Target Target Actual Actual Sustainability Index reduction % Sustainability Index performance % 2007 (baseline) 1.63 0% 1.63 0% 2008 1.59 -2% 1.64 1.6% 2009 1.55 -5% 1.41 -13% 2010 1.46 -10% 1.39 -15% 2011 1.38 -15% 1.41 -13% 2012 1.30 -20% 1.43 -12% 2013 1.20 -26% 1.26 -22%
Sustainability performance
Chisholm monitors its sustainability performance against ResourceSmart targets quarterly. The 2013 performance summary follows:
2013 (Jan–Dec) VS 2007 baseline (Jan–Dec) Baseline Actual % Impacts/indicators Measure 2007 2013 (‘07 vs’13) Square metres (mth avg) M2 98,784 120,324 21.8% Student contact hours (enrolled) SCH 9,250,627 12,021,892 30.0% Student enrolments # 40,329 43,040 6.7% Staff EFT (avg) EFT 956 853 -10.8% Student EFTSL (SCH/720) EFTSL 12,848 16,697 30.0% Student (EFTSL) + staff (EFT) EFTSL + EFT 13,805 17,550 27.1% 2011 targets t Co2e 14,223 15,272 T1 – Emissions reduction (25%) t CO2e/EFTSL+EFT 1.03 0.87 15.5% MJ 61,636,903 57,045,012 T2 – Energy reduction (25%) -27.2% Total MJ/EFTSL+ EFT 4,465 3,250 MJ 3,187,044 0 T3 – GreenPower purchase (25%) -9.8% % 9.8% 0% MJ 0 39,210 T4 – Renewable energy (10%) 0.06% % 0 0.06% kL 36,744 28,049 T5 – Water reduction (35%) -39.8% kL/EFTSL+ EFT 2.66 1.60 t 847 1,125 T6 – Waste to landfill reduction (45%) t/EFTSL+ EFT 0.0613 0.0641 4.5% % recycled 13.3% 24.5%
Chisholm Institute Annual Report 2013 119 Environmental performance
Notes: There are many variables that impacted on Chisholm achieving its sustainability targets. Impacts include: • the square metres (m2) of building area increased by 21.8 per cent in 2013 compared to 2007 • the enrolled student contact hours (SCH) increased by 30 per cent in 2013 compared to 2007 • Chisholm operating hours increased in line with the additional delivery.
2013 environmental data
Energy use 2013 Total energy usage segmented by primary source, including GreenPower (megajoules) Electricity 30,703,308 Natural gas 26,341,704 GreenPower 0 Total 57,045,012 Greenhouse gas emissions associated with energy use, segmented by primary source Electricity (S2) 10,149 and offsets (tonnes CO2e) Electricity (S3) 1,279 Natural gas (S1) 1,352 Natural gas (S2) 105.37 GreenPower 0 Total 12,885 Percentage of electricity purchased as GreenPower (%) 0 Units of energy used per full time employee (megajoules per FTE) 66,876 Units of energy used per unit of office area (megajoules per m2) 474 Waste production Total units of office waste disposed of by destination (kg per year) Landfill 1,125,189 Recycled 364,935 Total 1,490,124 Units of office waste disposed of per FTE by destination (kg per FTE) 1,747 Recycling rate (% of total waste by weight) 24.5% Greenhouse gas emissions associated with waste disposal (tonnes CO2e) 1,238
Paper use Total units of A4 equivalent copy paper used (reams) Corridor printers* 7,925 (1 ream = 500 pages/sheets). *Figure is based on the assumption that the total Print room 12,169 impressions/clicks are all calculated as printing double sided only to work out the total Total 20,094 page/paper count. A3 paper usage has not been included. Units of A4 equivalent copy paper used per FTE (reams per FTE) 23.5 Percentage of recycled content in copy paper purchased (%) Recycled content 0 Carbon neutral 81 FSC accredited 95 Percentage of publications available electronically 100% Water consumption 2013 Total units of metered water consumed by water source (kilolitres) 28,049 Units of metered water consumed in offices per FTE (kilolitres per FTE) 32.8 Units of metered water consumed in offices per unit of office area 0.23 (kilolitres per m2)
120 Chisholm Institute Annual Report 2013 Transportation Total energy consumption by vehicle fleet segmented by vehicle type (L) Diesel 9,357 LPG 15,534 Petrol 118,388 Total 143.279 Total vehicle travel associated with entity operations segmented by vehicle type (km) 1,533,254 Greenhouse gas emissions from vehicle fleet (tonnes CO2e) segmented by vehicle Diesel (S1+3) 27.13 type – total and per 1,000 km LPG (S1+3) 26.54 Petrol (S1+3) 292.41 Total 346.08 Total distance travelled by air (km) 2,305,755 Percentage of employees regularly using public transport, cycling, walking etc n/a† Greenhouse gas emissions Total greenhouse gas emissions associated with energy use (tonnes CO2e) 12,885 Total greenhouse gas emissions associated with vehicle fleet (tonnes CO2e) 346 Total greenhouse gas emissions associated with air travel (tonnes CO2e) 784 Total greenhouse gas emissions associated with waste disposal (tonnes CO2e) 1,238 Greenhouse gas emission offsets purchased (CO2-e) n/a† Procurement Chisholm chooses to partner with environmentally responsible suppliers by incorporating sustainability as part of the tender evaluation process. All tender applicants are required to provide details of strategies that will be adopted to contribute to Chisholm’s commitment to sustainability
† Not available in 2013 but will be reported from 2014 onwards.
Sustainable Campus Group
Chisholm Institute is an active member of the Sustainability Campus Group, which is focused on progressing sustainability in the tertiary and vocational education sector. In 2013 Chisholm participated in the Sustainability Campus Group sector reports. The reports are focused on participating institutes’ (universities and TAFEs) operational environmental performance such as energy, water, waste and emissions; however it also captures institutional commitment including education for sustainability. The report is a national benchmark report on environmental performance for the sector and can be viewed here: www.monash.edu/research/sustainability-institute/assets/documents/scg- report-2012_web.pdf.
Greener Government Buildings initiative
In 2013 Chisholm partnered with Ecosave to complete a Detailed Facility Study (DFS) of Institute facilities as part of the Department of Treasury and Finance’s Greener Government Buildings program. The DFS is equivalent to a level three energy audit under AS/NZS3598:2000 and will form the basis of an Energy Performance Contract for cost-effective energy and water efficiency solutions with guaranteed energy and water savings over a seven-year period. This initiative will provide significant energy and water savings to Chisholm and will support the Victorian Government target, which requires departments to have committed to implement an Energy Performance Contract at sites accounting for at least 90 per cent of their total energy consumption by 2018.
Chisholm Institute Annual Report 2013 121 Financial Management Compliance Framework
Under the Victorian Government Financial Management Compliance Framework (FMCF), Chisholm Institute makes an annual declaration on financial management, taxation, purchasing, theft and losses, compliance and reporting processes.
In accordance with the FMCF, Maria Peters, CEO and the Accountable Officer for Chisholm Institute and Grant Radford, Chief Operating Officer for Chisholm Institute have made a declaration to the Institute Board that Chisholm’s financial reports are founded on sound risk management, internal compliance and control systems.
In 2013, Chisholm Institute reports no non-compliances with the FMCF.
Application and operation of the Protected disclosure Act 2012 Chisholm has implemented a policy and procedural framework to encourage and facilitate the making of protected disclosures of improper conduct by Chisholm’s officers and employees. Chisholm’s procedure provides protection and support for persons who made a disclosure and establishes a system for matters to be investigated and, where necessary, corrective actions to be taken.
For the year ended 31 December 2013: (a) There was one matter raised with Chisholm under the Projected Disclosure Act 2012. (b) There were no matters referred to Chisholm for investigation by the Ombudsman in 2013 (c) There were no matters referred to Chisholm Institute which the Institute declined to investigate.
122 Chisholm Institute Annual Report 2013 Report on the Implementation of the Victorian Industry Participation Policy (VIPP)
Chisholm has complied with the Victorian Industry Participation Policy Act 2003. 1. We commenced three construction contracts during this reporting period, totalling $35,627,495.80, for which the VIPP applied. 2. The commitments by contractors under VIPP included: - An overall level of local content of 86% of the total value of the contracts; - 336 number of full time equivalent jobs; - 11 number of apprenticeships/traineeships; and - The following benefits (as highlights) to the Victorian economy in terms of skills and technology transfer increases; engagement of new apprentices and retain existing; monitored training programmes and use of industry accredited training schemes.
Project Contract Contract Value Metropolitan / Overall Value of Number of FTE jobs Number of Award (ex GST) Regional Local Content of apprenticeships Employment Employment the total value / traineeships Created Retained of Contract(ANZ Value-created Activity)
Berwick TCC 21 December $17,317,953.00 Metropolitan 83% 3 113 8 2012
Benefits to the Victorian Economy APM group training initiatives and promotion of the Skills for Growth; the Workforce Development Program; and Engagement of two new and 6 existing apprentices. Frankston START 11 April 2013 $15,729,539.00 Metropolitan 90.91% 10 100 3 TTC
Benefits to the Victorian Economy A monitored training program for each employee; and Engagement of one new and 2 existing apprentices. Mornington 14 November $2,580,003.80 Regional 87.79% 100 10 0 Peninsula SPTTC 2013
Benefits to the Victorian Economy Allmore training enhancing skills of the workforce; and Use of Industry accredited training schemes.
Total $35,627,495.80 113 223 11
Chisholm Institute Annual Report 2013 123 Formation and objectives of the Caroline Chisholm Education Foundation
The Caroline Chisholm Education Foundation is a ‘controlled-entity’ of the Chisholm Institute Board, which operates under a Trust Deed approved by the Board and an operational agreement with the Board.
The Caroline Chisholm Education Foundation began operations in 2006. The Foundation proudly bears the name of the pioneer Caroline Chisholm who, on her arrival in the new Australian colony in 1838, was compelled to help change the appalling conditions of poor, vulnerable migrants. ‘I promise to know neither country nor creed, but to serve all justly and impartially,’ she wrote.
Objectives of the Foundation
The objectives of the Foundation set out in the Trust Deed are as follows: a) to strive to continue Caroline Chisholm’s values and legacy of social justice by providing support to disadvantaged students and members of the Chisholm Institute community b) to provide scholarships, studentships, fellowships, bursaries and other forms of financial assistance, and support to students of the Institute (past, present or future) or members of the Institute community who are confronted by disadvantage, adversity, lack of opportunity or other circumstances that impede their advancement in education or the development of their vocational skills c) to provide sponsorship or other forms of financial assistance to persons living outside Australia who are confronted by disadvantage, adversity, lack of opportunity or other circumstances that impede their advancement in education or the development of their vocational skills d) to create opportunities for staff and students of the Institute to participate in philanthropic activities, training programs and educational or vocational initiatives, and to provide a source of funding for such activities, programs and initiatives that would assist and support students of the Institute (past, present or future), members of the Institute community or other persons confronted by disadvantage, adversity or lack of opportunity in educational advancement or vocational skill development in accordance with these general objectives e) to extend invitations to staff, students, alumni, parents of students and individual organisational and corporate friends of the Institute to become contributors to the Foundation, and through such contribution to participate and join more actively and effectively in supporting and assisting the Institute to promote and carry out the objectives of the Foundation.
National Competition Policy
Chisholm has developed costing and pricing models that apply to Chisholm costs including overhead, infrastructure and other indirect costs, where appropriate, to take into account any competitive advantage that Chisholm may have.
This enables Chisholm to comply with National Competition Policy, including the requirements of the government policy statement, ‘Competitive neutrality: A Statement of Victorian Policy’, the ‘Victorian Government Timetable for the Review of Legislative Restrictions’ and subsequent reforms.
124 Chisholm Institute Annual Report 2013 Compulsory non-academic student fees income and expenditure statement For the year ended 31 December 2013
Chisholm Institute imposes compulsory non-academic fees known as the Student Services and Amenities Fee and the Ancillary Fee for the purposes of providing additional student services, amenities, activities and ICT infrastructure. The 2013 Student Services and Amenities Fee was calculated on the basis of 30 cents per enrolled student contact hour in government funded accredited courses, with a maximum fee of $150 and a minimum fee of $50. Certain concessions and exemptions applied. For 2013, the Ancillary Fee was a flat $25 per enrolment. The collection and expenditure of the fees is subject to the provisions of the Education and Training Reform Act 2006.
The 2013 academic year saw $1,536,252 collected from students via the abovementioned non-academic fees, subscriptions and charges. The funds collected were made available to a significant range of services, initiatives and support infrastructure aligned to the Institute strategy of ‘Institute of Choice’. These included disability liaison services including pre-enrolment planning, timetabling and career direction services as well as the provision of interpreter services, note takers and assistive technologies and other adjustments to accommodate students with individual requirements. Funds were applied to services providing youth counselling, career counselling and guidance, and personal counselling, all aimed at enhancing the educational opportunities while dealing with other issues of significance. Significant investments were made in student communication and events, the student portal and the graduate jobs portal to ensure the Institute was connecting with the student body and providing details about access to a range of services to assist their entry into the workforce.
In terms of support infrastructure, funds were made available to the student PC replacement program and ongoing maintenance of the wireless network to ensure students have access to up-to-date and fit for purpose technology for their learning. Collaborative learning spaces were supported in student common areas such as libraries to support the learning experience. Ongoing level 1 and 2 ICT helpdesk support for students rolled out across the Institute. A range of self-service charge stations and interlinked communications screens were also rolled out across Chisholm during 2013, making information and services directly accessible to students.
During the 2013 academic year, the Institute invested more in student support services and infrastructure than was collected through the compulsory non-academic fees, subscriptions and charges collected from students in line with our strategy – ‘Institute of Choice’.
Peter Harrison Executive Director Educational Leadership and Student Experience Chisholm Institute
Chisholm Institute Annual Report 2013 125 Prices, fees, charges, rates and levies charged by Chisholm Institute
Chisholm charges a range of fees and prices for programs and services offered by the Institute. For 2013, the fees and charges included:
(a) Tuition fees for eligible Victorian Training Guarantee students. These ranged between $0.00 and $8.00 per hour, depending on the course, cohort and competitive forces. There was no minimum fee and maximums did not apply (with the exception of VCAL, which was capped at $1430). (b) Students who were ineligible for the Victorian Training Guarantee paid tuition fees ranging between $5.80 and $12.00 per hour. (c) A compulsory service and amenities fee was charged for the purpose of providing student services and amenities. The fee was based on 30 cents per enrolled hour with a minimum fee of $50 and a maximum fee of $150. (d) An ancillary fee of $25 was charged in 2013. The fee was used to support the provision of information and communications technology equipment and access to students. (e) A non-compulsory materials fee for eligible Victorian Training Guarantee students to cover the actual cost of providing materials or services used or retained by a student in a particular course of study. The fee varied for each course depending on requirements. Full details were provided to each student prior to enrolment. (f) Recognition of prior learning tuition fees were initially set at 50 per cent of the normal tuition fee for both Victorian Training Guarantee and fee for service students. This fee was abolished for enrolments after 12 August 2013 for Victorian Training Guarantee students. (g) All eligible Victorian Training Guarantee students who held valid concession cards (Commonwealth Health Care Card, Pensioner Concession Card and Veteran’s Gold Card) received an 80 per cent discount on their tuition fees and paid a maximum of $50 for the services and amenities fee. (h) Programs and services provided on a fee-for-service basis were priced in accordance with National Competition Policy principles. (i) Programs and services provided to international students and industry based customers were costed on a commercial basis. (j) Other fees and charges of a cost-recovery nature, e.g. library fines, parking fines, photocopying and printing charges for staff and students.
126 Chisholm Institute Annual Report 2013 ACRY ON MS
This listing is prepared to assist in the understanding of the Annual Report and related materials.
AAS Australian Accounting Standard AASB Australian Accounting Standards Board AEE Annualised employee equivalent ARR Accounting rate of return BTCC Berwick Trade Careers Centre CCEF Caroline Chisholm Education Foundation CEO Chief Executive Officer DFS Detailed Facility Study DREAM Dandenong Regional Educational Alliance Model (Dandenong TTC) EBITDA Earnings before interest taxes and amortisation EFT Equivalent full time (when referring to staffing) EFTSL Equivalent full time student load ETR Education and Training Reform Act 2006 FBT Fringe benefits tax FFS Fee-for-service FMA Financial Management Act 1994 FMCF Financial Management Compliance Framework FRD Financial Reporting Directions FSC Forest Stewardship Council FTE Full time employee GST Goods and services tax HACC Health and community care IFRS International Financial Reporting Standards LSL Long service leave MBA Master of Business Administration OH&S Occupational health and safety PACCT Professional, Administrative, Clerical, Computing and Technical PAEC Decision of Public Accounts and Estimates Committee of Parliament December 1997 PPE Personal protective equipment SCH Student contact hours SD Standing Directions of the Minister for Finance issued under the Financial Management Act 1994 START School TAFE Alliance Regional Trade (Frankston TTC) TELC Technology Enabled Learning Centre TTC Trade Training Centre TVET Company owned by the Ministerial Council for Tertiary Education and Employment UIG Urgent Issues Group VCAL Victorian Certificate of Applied Learning VCE Victorian Certificate of Education VET Vocational education and training
Chisholm Institute Annual Report 2013 127 LOCATIONS
Bss a CoAST Cnr White Road and South Dudley Road, Wonthaggi VIC 3995
Berwick 25 Kangan Drive, Berwick VIC 3806
CHISHOLM @ 311 311 Lonsdale Street, Dandenong VIC 3175
Cranbourne New Holland Drive, Cranbourne VIC 3977
Dandenong 121 Stud Road, Dandenong VIC 3175
Frankston Fletcher Road, Frankston VIC 3199
Mornington Peninsula Cnr Henry Wilson Drive and Boneo Road, Rosebud VIC 3939
1300 244 746 chisholm.edu.au
©Chisholm Institute February 2014 CRICOS No 00881F TOID - 0260 0523-0314