MELBOURNE & OLYMPIC PARKS TRUST ANNUAL REPORT 2012
MELBOURNE & OLYMPIC PARKS TRUST ANNUAL REPORT 2012
CONTENTS
Governance 4-5 The Chairman’s Report 6 The CEO’s Report 7 Highlights 2011-12 9 Our Partners 11 Financial Overview 12 Financial Statements 13-41 Administrative Reporting Requirements 42–44 Disclosure Index 45
Annual Report 2012 3 Governance
Establishment • To provide for the development, promotion, management, operation and use of facilities and services for the parking The Melbourne and Olympic Parks Trust (MOPT) was of vehicles and other necessary services to be used in established on 5 October 1995 pursuant to the provisions of conjunction with any of the facilities operated or managed The Melbourne and Olympic Parks Act 1985 (as amended). by the Trust It was created by the merger of the National Tennis Centre • To provide for the management of Gosch’s Paddock by Trust (established 13 Nov 1985) and the Olympic Park the Trust as a committee of management under the Committee of Management (formed originally in 1909). The Crown Lands (Reserves) Act 1978. Act is jointly administered by both the Premier of Victoria, the Honourable Ted Baillieu, and the Minister for Sport and Recreation, the Honourable Hugh Delahunty. The Trust’s Vision To be recognised as being amongst the world’s best and most The Melbourne and Olympic Parks Act 1985 successful sport and entertainment precincts. The Purpose of the Act: The purposes of the Act as outlined in section 3 are: Our Mission • To create a Melbourne and Olympic Parks Trust to Melbourne and Olympic Parks Trust - Managing one of the administer the National Tennis Centre, Olympic Park and world’s leading destinations for sports, entertainment and certain other land and facilities for the purposes of tennis, recreation. other sports, recreation and entertainment The Trust: • To provide for the management and operation of the • Provides venues, services and infrastructure of an National Tennis Centre and Olympic Park international standard to: • To provide for the use and promotion of the National – provide a home for Tennis Australia and the Tennis Centre and Olympic Park Australian Open; • To provide for the development, promotion, management, – attract and support the delivery of large spectator operation and use of sports, recreation and entertainment based indoor and outdoor sporting and entertainment facilities and services in Victoria in addition to those at the events; National Tennis Centre and Olympic Park. – enhance Melbourne’s public recreational amenities; Under the Act the Trust has the following primary functions: – support Victoria’s major events, tourism and sports strategies. • To accept appointment and act as a committee of management of Crown lands. • Ensures that it earns a sufficient income from its activities in order to be able to deliver on these obligations in the • To be responsible for the care, improvement, use and long term; promotion of the National Tennis Centre and Olympic Park as facilities for tennis, other sports, recreation and • Operates a small but flexible customer focussed entertainment organisation that delivers successful events in partnership with key stakeholders; • To operate the National Tennis Centre and Olympic Park efficiently and effectively to obtain the best possible use of • Maintains an environmentally sustainable precinct the facilities integrated with the City and its parklands. • To provide planning for the operation of the National Tennis Centre and Olympic Park which is coordinated between the two facilities • To be responsible for proper financial management of the National Tennis Centre and Olympic Park • To provide for the planning, development, promotion, management, operation and use of other sports, recreation and entertainment facilities and services in Victoria
4 Melbourne & Olympic Parks Trust GOVERNANCE
Trustees
Russell Caplan Kate Joel Scott Tanner David Stobart The Honourable John Cain Sue Nattrass AO Diana Nicholson Deborah Beale (to 26/5/2012) John Howie (to 24/3/2012) Ray Smith Geoffrey Pollard AM Tim Jacobs executive GROUP
Brian Morris - Chief Executive Officer Shane Mates – General Manager AAMI Park Travis Mardling - Chief Financial Officer Donna Price – General Manager People and Culture Lloyd Freeburn - Director of Services and Building Infrastructure Mark Zundans – Director of Operations Melbourne Park
Statement of Corporate Governance Finance Audit and Risk Committee Procedures have been established at the Trust and executive The Trust has established a Finance Audit and Risk management level, which are designed to safeguard the Committee to advise the Trust in relation to matters falling assets and interests of the Trust and to ensure integrity into the broad areas of: of reporting. The Trust acknowledges the need for and • Financi al reporting, accounting policies and internal continued maintenance of the highest standards of corporate controls governance practice and ethical conduct by all Trustees and employees of the Trust. • Risk management • Governance Remuneration Committee • Funding The Trust has established a Remuneration Committee The Committee meets monthly or more often as required and to govern the Trust’s policy and practise for executive makes recommendations to the Trust on specific issues. remuneration and to determine the individual remuneration packages for its executive staff. The Committee meets as The Members of the Committee during the year ended 30 required and makes recommendations to the Trust on specific June 2012 were: issues. The members of the Committee during Ray Smith (Chair) John Cain the year ended 30 June 2012 were: Russell Caplan Geoff Pollard Russell Caplan (Chair) Sue Nattrass Deborah Beale Sue Nattrass All Finance, Audit & Risk Committee members are Geoff Pollard independent from management. John Howie Diana Nicholson Ray Smith Strategic Planning Committee
The Trust’s Strategic Planning Committee is established to provide independent and expert advice to assist the Trust to discharge its strategic planning responsibilities.
The Members of the Committee during the year ended 30 June 2012 were: Russell Caplan (Chair) Kate Joel Deborah Beale Ray Smith Tim Jacobs Scott Tanner
Annual Report 2012 5 The CHAIRMAN’s report
Another dynamic year of diverse events generated a positive The new Olympic Park Oval and its surrounds are currently financial result for the Melbourne and Olympic Parks Trust. The under redevelopment and due for completion at the end of 2012. precinct is undergoing extensive redevelopment as it implements The oval and parkland under construction will further enhance the long term master plan addressing the needs of the Australian the precinct’s public open space and recreational facilities. To Open and other precinct stakeholders. Maintaining MOPT’s honour the site’s athletics and Olympic heritage, the iconic strong financial results during the redevelopment period will be statue ‘Sportsmanship’ (commemorating John Landy and Ron a challenge, as costs will increase before the new facilities are Clarke’s famous Olympic qualifying race) and 1956 Olympic operational and a significant, albeit necessary, portion of the new interpretive pieces will also be located in this area. infrastructure will not be revenue generating. AAMI Park welcomed its one millionth patron in February after The year produced many highlights including another less than two years of operation, a testimony to the popularity Australian Open record attendance of 686,006 patrons, thanks of the stadium. A celebratory 360 degree Fan Cam photograph in part to the wonderful weather. The tournament broke the was taken of the crowd at the Melbourne Victory v Melbourne worldwide Grand Slam one day attendance record when 80,649 Heart Derby and was widely distributed through social media fans flocked to the precinct for the middle Saturday. In the channels. The stadium also delivered its first concert, the men’s final Novak Djokovic won his third Australian Open Foo Fighters 2012 Australian tour, attracting capacity 30,000 defeating Rafael Nadal in a gruelling five set match played attendances both nights. over 5 hours and 53 minutes (the longest final in Grand Slam history). Victoria Azarenka defeated Maria Sharapova in the AAMI Park continues to attract worldwide attention and won Women’s Final for her first major title. several significant awards during the year including the Professional Footballers Association ‘Best Pitch’ award and Our extensive redevelopment is being completed in stages ‘most iconic and culturally significant’ stadium at the 2012 and this year’s Australian Open used the improved public World Stadium Awards held in Doha, Qatar. facilities now available between Rod Laver Arena, Hisense Arena and Batman Avenue. Additionally, significant storm water In line with global trends there were fewer Rod Laver Arena harvesting, treatment and clear water storage facilities have concert days than last year; however the arena is still reported been installed under these areas to reduce the precinct’s usage by international live music industry trade magazines as being of potable water, while allowing improved landscaping and amongst the world’s top live music arenas. maintenance during times of drought. On behalf of the Trustees, I would like to recognise and thank In January, the Victorian Government unveiled the new design retiring member John Howie for his outstanding contribution for Margaret Court Arena with an operable roof, improved public and service to this precinct for over 30 years, starting originally facilities and increased capacity to 7,500. The construction with the Olympic Park Committee of Management in 1982, and is now underway and is due for completion in 2015. This will then as a Melbourne and Olympic Parks Trustee. make the Australian Open the only Grand Slam boasting three feature courts with operable roofs and will further enhance our On behalf of the Trustees I would also like to express my thanks suite of sport and entertainment facilities year round. to the Premier of Victoria, The Honourable Ted Baillieu, and the Minister for Sport and Recreation, The Honourable Hugh In May, the Victorian Government announced a $5.5 million Delahunty for their unwavering support. commitment to fund a detailed design and business case, in preparation for the next stage of the Melbourne Park The MOPT team led by Chief Executive Brian Morris has shown redevelopment. This next stage will include upgrading Rod incredible resilience and dedication to ensure the precinct Laver Arena, the creation of new public spaces and amenities, operates flawlessly during this difficult time of redevelopment as well as improved player, media and broadcast facilities. and I thank them and my fellow Trustees for their efforts.
The new Eastern Plaza redevelopment, which includes an In accordance with the FMA 1994, I am pleased to present the elevated plaza linking AAMI Park and the MCG, parking Report of Operations for the Melbourne & Olympic Parks Trust for 1,000 cars and a new National Tennis Centre for sports for the year ending 30 June 2012. development, is well underway and remains on target for completion by April 2013. In June, the Government announced that the new footbridge linking the Eastern Plaza to AAMI Park will be named after Australia’s first Olympian, Edwin Flack. The footbridge will provide a pedestrian link between the MCG, Hisense Arena and AAMI Park, reducing traffic congestion during events and providing safe access to our venues. Russell Caplan
6 Melbourne & Olympic Parks Trust The CEO’s report
Attendance and Performance AAMI Park The Trust delivered a positive result with a net profit of $5.3 AAMI Park had a very strong year with 732,806 ticketed million. During the year our venues attracted a total of 2.3 patrons attending 49 event days. million ticketed patrons which was slightly down on the precinct record set the previous year due to lower numbers The two Melbourne derbies at the Stadium were near sell of concert days and attendance at Rod Laver Arena. outs. Melbourne Heart, in their second season, improved enough to make the A-League finals. The Australia v Saudia Australian Open Arabia World Cup Qualifying match drew 24,214 people and The Australian Open achieved a record attendance overall provided Socceroos fans a satisfying 4-2 victory. Meanwhile, with the middle Saturday setting another one day record. Glasgow Celtic supporters’ passion was on full display at Melbourne Parks new layout handled the increased num- their exhibition game against Melbourne Victory. The spec- bers extremely well, particularly the main public areas such tacular sea of green and white clad fans was rewarded with as Grand Slam Oval, River Terrace and Garden Square. a 1-0 win over the locals. Rod Laver Arena In their 15th year of operation, Melbourne Storm produced a superb 2011 NRL season before going down to Auckland In total, Rod Laver Arena attracted 629,842 patrons to 63 Warriors in a home preliminary final. The ever competi- concert days, slightly down on the previous year. An 80’s re- tive Storm subsequently picked up where they left off with surgence featured Janet Jackson, Roxette, Backstreet Boys/ a strong start to the 2012 season. The ANZAC Day game New Kids on the Block, Steve Winwood/Steely Dan, Sade against the Warriors continued to build momentum with and most spectacularly, Prince. One of the world’s biggest another strong crowd confirming its status as a highlight of touring acts, Roger Waters’ The Wall, sold out three shows the NRL fixture. boasting one of the largest and most impressive productions ever installed in the arena. Other highlights included iconic Meanwhile in Super Rugby, the Melbourne Rebels’ second Australian band Cold Chisel’s two sold out concerts and season consolidated their supporter base with improved on- Lady Gaga performing five shows to her legion of devoted field performances and strong attendances. ‘monsters’. AAMI Park staged its first concert in December with two Hisense Arena sold out Foo Fighters shows each attracting 30,000 patrons. In total, Hisense Arena attracted 232,139 patrons to 53 event The events were so successful the band featured these days. Notably, global phenomenons One Direction and Nicki concerts in their song videos. A great deal of planning went Minaj both played promotional shows for the first time at into the event to ensure the pitch was properly protected this arena. Each will return to Rod Laver Arena on their and patrons had a great experience. The stadium proved its world tours. concert capabilities with the next game played on a flawless surface. Hisense Arena welcomed the world premiere of the arena spectacular ‘How to Train Your Dragon’, a highly technical A wider sector of the public also had the opportunity to view and exciting animatronics show which is now touring glob- AAMI Park up close on Melbourne Open House day; a pro- ally. gram that provides free access to many significant buildings in and around the city. As part of the annual event, over 800 The UCI Track Cycling World Championships attracted curious people took a backstage tour of the stadium. sold out crowds over five days of intense competition, the upgrades to the track were tested and met the approval of Corporate Hospitality and Events the teams. Melbourne Vixens cemented Hisense Arena as The Function Centre business enjoyed a strong year with their home showing significant growth in their attendances. 191 event days, representing a solid increase in revenue and Netball is becoming an important contributor to the Arena’s occupancy on the previous year. content.
Annual Report 2012 7 The CEO’s report
Capital Projects and Infrastructure People and Culture The Trust currently has assets under management of $1.1 Safety is a key strategic platform of our business. We are billion, this requires an intensive maintenance and im- very pleased to have gained AS4801 initial level accreditation provement regime. More than $16 million was invested in addition to our SafetyMap accreditation during the year- a in upgrading and replacing facilities and infrastructure reflection of our ongoing commitment to improving safety during the year. These works included the redevelopment of across all areas of our business. Olympic Park, improvements to the Australian Open Player Cafe, patron and tournament facilities, installation of new The organisation is currently undergoing a period of sub- technology, the relocation of administration facilities and stantial change with impact of the construction on opera- improvements to AAMI Park and its surrounds. tions and the incorporation of new and expanded venues. The office relocation was completed with three new work The new Player Café was well tested during the Australian hubs based at Hisense Arena, Rod Laver Arena and AAMI Open and the improved patron facilities allowed for greater Park. Due to the permanent workforce now located in three food choices and speed of service. Other new player facili- areas of the precinct, improving communication between ties included a gymnasium and warm-up area, a player areas will be a focus for the new year. The “Your Voice” em- lounge and an additional outdoor area. The new River ployee engagement survey captured more than 50% of the Terrace with its wooden decks and landscaping along Bat- workforce in order to understand better staff alignment and man Avenue, as well as the new Oval, has delivered greatly engagement levels. The results of this survey are currently improved public facilities for the Australian Open. being reviewed. The Employee Wellbeing Program, aimed at increasing the health and wellness of our staff, has been Maintaining public landscaped areas and playing surfaces well utilised. remains a priority. We see ever increasing numbers of public and organised sport utilising our spaces for recreation and training. Despite works undertaken by utilities companies to re-route services during the year on Gosch’s Paddock, the I would like to thank the Chairman of the Trust, Russell Ca- area remained open for public access throughout the year. plan and the Trustees, Peter Hertan at Sport and Recreation Victoria, and Tim Bamford at Major Projects Victoria and Melbourne Park Redevelopment their respective teams for their support during the year. Fi- The redevelopment continues at a rapid rate with extensive nally, a special thanks to the Melbourne and Olympic Parks works already completed on the Eastern Plaza. The new team who have continued to deliver exceptional events and National Tennis Centre has already changed the skyline of service during a period of significant change and disruption. the precinct significantly. The Margaret Court Arena devel- opments, a three year project due for completion in 2015, are also well underway with the commencement of drilling and piling and works on the seating bowl. The activities re- quire day to day management and communication between
all of the stakeholders as they impact on the precinct’s operations. We appreciate the patience and understanding of our tenants and hirers while we upgrade our facilities for the future.
Brian Morris
8 Melbourne & Olympic Parks Trust highlights 2011-2012
Events
AUSTRALIAN OPEN 2012 Nicki Minaj Be What You Want’ - Charity Expo One Direction Beaconhills Valedictory Dinner Rod Laver Arena Planet Shakers Conference Belarus Cycling Federation Cocktail Party Cold Chisel Rock Eisteddfod Challenge Billanook Dinner / Banquet Def Leppard Melbourne Vixens - ANZ Championship (6 Blue Cross Community and Residental Disney on Ice Presents Worlds of Fantasy home games) Services Dolly Parton State of Origin Rodeo Carey Baptist Grammar Year 12 Duran Duran Teacher’s Union Meeting Valedictory Dinner Elton John UCI Track Cycling World Championships Coles Limited Business Meetings Enrique Iglesias Victorian State Schools Spectacular Collingwood Football Club Anzac Day Evanescence X Factor Auditions Luncheon Florence + The Machine Youth Alive Connect Entertainment Conference Frankie Valli CPA Exam Marking Hawthorn Football Club Grand Final Day Olympic Park Stadium CSL Annual General Meeting Function AGS Athletics Carnival CSR Limited - Annual General Meeting Janet Jackson All Schools Track Relay Championship DARU (Disability Adovacy Resource Unit) Jehovah’s Witness Convention APS Athletics Carnival Conference John Fogerty GSV Championship Carnivals Department of Justice Conference Kings of Leon GSV Finals Evening Department of Education Conference Lady Gaga Schools Knockout Department of Treasury and Finance Meat Loaf Victorian Rugby League - Under 12s Conference Motley Crue Championships Electronex Exhibition 2011 Event Mangement Group (EMG) - Sensis Nitro Circus AAMI Park NKOTBSB White Pages Conference Australia vs Saudi Arabia - World Cup Placido Domingo and Katherine Jenkins Empowernet - Wealth Mastery Qualifier Conference Prince FFV Mirabella Cup Esso Luncheon Rod Stewart FFV Premier League Grand Final Fremantle Dockers Cocktail Party Roger Waters - The Wall Foo Fighters in Concert Frontline Sportsfirst Range Days Roxette Glasgow Celtic vs Melbourne Victory Global Creatures - How to Train Your Sade Melbourne Heart - Hyundai A-League (13 Dragon After Party Slipknot home games) Hasbro Events Exhibition Steely Dan & Steve Winwood Melbourne Rebels - Super Rugby (10 Healthcert Workshop System of a Down home games) ICB Bookeepers Conference Taylor Swift Melbourne Storm - NRL (12 home games) ITAC 2012 The Footy Show Grand Final Edition Melbourne Victory - Hyundai A-League (8 Janet Jackson Pre Show Party Tim McGraw and Faith Hill home games) Jehovah’s Witness Convention Winterbeatz Melbourne Park Function Centre LION - Leading Our Achievement Culture WWE 2011 2012 Medical Careers Expo Conference Hisense Arena 7 Eleven Franchisee Meeting LION - Capability and Development Conference 21st Century Education Summit Aged and Community Care 2012 State Market Australia Leadership School 2011 Australia v New Zealand - Netball Congress & Exhibition Municipal Association of Victoria (MAV) - Australian Dancesport Championship Aged and Community Care Conference Conference Beautiful Woman Conference Albanian Concert 2012 Appita Exhibition and Conference Municipal Association of Victoria (MAV) - Celtic Thunder The Future of Local Government Summit Cesar Millan Association & Communications Events - Roads Conference Municipal Association of Victoria (MAV) - Corporate Sports Australia AFL Grand Waste Policy Forum Final Brunch Association and Communications Events - Zero Waste Conference Melba Support Services 2011 Conference Godskitchen Australian Football League Banquet Melbourne Girls Grammar How to Train Your Dragon - Australian Dinner Melbourne Storm Auction Night Tour Australian Open Media & Corporate Melbourne Storm Post Match Members Jacky Cheung 1/2 Century Tour - Launch Function Australia AXA Retirees Christmas Lunch Melbourne Fire Brigade Conference London 2012 Basketball Farewell Series BDO Chartered Accountants Banquet Methodist Ladies College (MLC) Year 12 Metro Trains Family Day & Concert Dinner formal 2012
Annual Report 2012 9 highlights 2011-2012
Events (cont)
NAB BBQ & Tennis Day (SLAV) Conference Victoria’s Small Business Festival NAB Personal Banking - Business St Kevin’s College 2012 Formal VMUG User Group Exhibition Operations Team Day Swinburne Univeristy Exams Vocational Training Group Graduation Nique Stewarts Mindset to Millionaire Synnex Alliance Expo 2011 Dinner Seminar Tennis Australia Uniform Fittings Western Bulldogs Breakfast Nitro Circus Pre Show Event Tennis Australia Conference Wound Management Conference PLAN Australia - Professional The BUPA Experience Youth Affairs Council of Victoria (YACVic) Development Day Ticketek - Elton John Pre Show Banquet Conference Planet Shakers Conference Dinner Public Sector Business Solutions Show TRUenergy Christmas Party Red Meat Networking Club Trade Event Victorian Dance Sports Rockwell Automation Conference Victorian Transport Association School Libraries Association Victoria Conference Key Statistics
2011/12 2010/11 Number of contracted days – Melbourne Park 233 238 Number of contracted days – AAMI Park 55 52 Number of contracted days – Melbourne Park Function Centre 191 186 RLA event ticketed attendance 629,842 942,510 Hisense Arena event ticketed attendance 232,139 177,617 AAMI Park event ticketed attendance 732,806 655,029 Melbourne Park Function Centre patrons 134,657 81,739 Attendance at Australian Open (grand slam record) 686,006 651,127 Crowd at AO, day 6 (one day grand slam record 80,649 77,121 Number of website visitors (all MOPT sites) 893,741 841,247
Major Capital Expenditure Expenditure type Amount Details
AAMI Park Infrastructure $1.1 million Includes a redesign of entry turnstiles, new administration offices and other modifications
Melbourne Park Infrastructure $3.7 million Includes improvements to tennis facilities, being the construction of a new player gym, upgrades to the player lounge, change room facilities, corporate suites, tennis court lighting and a refurbishment of Show Court 3. Safety related works included electrical switchboard upgrades, Hisense Arena canopy repairs and an upgrade to cycling infrastructure.
Olympic Park Redevelopment $8.7 million Costs incurred for the redevelopment of Olympic Park - demolition and civil works. This project is expected to be completed in March 2013
Equipment and Technology $2.5 million Includes continued upgrades to the IT network across the precinct, intranet system improvements, electronic security upgrades, new retail vending carts and other equipment and technology requirements
Westpac Centre Infrastructure $0.2 million Relates to upgrades to the swimming pool, roof membrane and drainage
TOTAL $16.2 million
10 Melbourne & Olympic Parks Trust Our Partners
The Trust would like to thank the following organisations for their support over the past year
Tenants Venue Partners Athletics Victoria AAMI Calibre Feasts ACG Collingwood Football Club Capricorn Stages and Rigging Imaging @ Olympic Park Delaware North Companies Australia Melbourne Football Club Hisense Australia Melbourne Storm Michael O’Brien Catering Melbourne Victory Ticketek Olympic Park Sports Medicine Centre Tennis Australia Tennis Australia Tennis Victoria Regular Arena Hirers Victorian Institute of Sport Chugg Entertainment Victorian Olympic Council Dainty Group Victorian Rugby Union Feld Entertainment Frontier Touring Live Nation Australia Suppliers Melbourne Vixens Coca-Cola Amatil Michael Coppel Presents Diageo Australia Van Egmond Group Carlton & United Breweries Heineken Lion Australia AAMI Park Clubs Kraft Foods Australia Melbourne Heart Lion Co (Dairy and Drinks) Melbourne Rebels Mars Snackfood Australia Melbourne Storm Nestle Peters Melbourne Victory Patties Foods Limited Pernod Ricard Australia Treasury Wine Estates
Annual Report 2012 11 FINANCIAL OVERVIEW
The financial statements in this report relate to the activities of Melbourne & Olympic Parks Trust for the year ended 30 June 2012. The net result for 2012 was a profit of $5.345 million (2011: $7.024 million). In the 2011/12 year the Trust received grants from the Victorian Government totalling $91.300 million all of which was treated as contributed capital (2011: $37.600 million all of which was treated as contributed capital). The grants in 2012 were further contributions towards the redevelopment of the Melbourne Park precinct (2011: grants towards the redevelop- ment of the Melbourne Park precinct). Total income for 2011/12 was $103.625 million, (2011: $101.534 million). Income related to the sales of goods and services increased by 2.6% which was primarily due to the success of the Australian Open which generated 11% greater income than the previous year. The significant factors in reaching this income were:
· The successful delivery of the Australian Open, including a record overall attendance which was 5% higher than the previous year;
· Rod Laver Arena hosting 63 event days with many high quality international artists performing during the year which resulted in strong event yields but less overall attendees than the previous year;
· Hisense Arena hosting 53 event days, attracting 31% more ticketed attendees than the previous year. The average attendance per show was at its highest level for many years and resulted in improvements in yields per event;
· AAMI Park hosting 49 event days, attracting 12% more ticketed attendees than the previous year. In addition to being the home of the Melbourne Storm (rugby league), Melbourne Rebels (rugby union), Melbourne Victory and Melbourne Heart (soccer), AAMI Park also hosted noteable one-off events including two Foo Fighters concerts, a World Cup Qualifier (soccer), a friendly soccer match between Glasgow Celtic and Melbourne Victory and 2 NRL finals;
· The Melbourne Park Function Centre achieved significant income growth from hosting a number of functions, conferences, seminars and dinners and saw a 65% increase in attendance figures. Significant events included the AFL Grand Final Day Dinner, Swinburne University exams and CPA exam marking weekends. Total expenses from transactions in 2012 was $98.434 million, (2011: $94.419 million). This increase in expenditure was predominantly as a result of the increase in event related revenue. Property, Plant & Equipment (less accumulated depreciation) increased by $56.435 million compared to last year, primarily due to the Melbourne Park redevelopment construction costs, partially offset by a decrease in the value of land and buildings as a result of a revaluation.
12 Melbourne & Olympic Parks Trust melbourne & olympic parks trust
FINANCIAL STATEMENTS
Comprehensive Operating Statement Balance Sheet Statement of Changes in Equity Cash Flow Statement Financial Year Ended 30 June 2012
Annual Report 2012 13 Comprehensive Operating Statement for the financial year ended 30 June 2012
NOTE 2012 2011 $’000 $’000
CONTINUING OPERATIONS
INCOME FROM TRANSACTIONS Sales of goods and services (2a) 100,335 97,746 Interest (2b) 1,501 643 Grants (2c) 820 2,143 Other Income (2d) 969 1,002 TOTAL INCOME FROM TRANSACTIONS 103,625 101,534
EXPENSES FROM TRANSACTIONS Cost of goods sold/distributed (3a) 35,150 30,409 Purchase of services (3b) 15,351 14,241 Employee expenses (3c) 17,305 17,213 Interest expense (3d) - 107 Depreciation (3e) 25,175 26,514 Other operating expenses (3f) 5,453 5,935 TOTAL EXPENSES FROM TRANSACTIONS 98,434 94,419
NET RESULT FROM TRANSACTIONS (NET OPERATING BALANCE) 5,191 7,115
Other economic flows included in net result Net gain/(loss) on non-financial assets (4a) (86) (77) Net gain/(loss) arising from revaluation of long service liability (4b) 240 (14) Total other economic flows included in net result 154 (91)
Net result 5,345 7,024
Other economic flows - other non-owner changes in equity Changes in physical asset revaluation surplus (7) (28,565) - Total other economic flows - other non-owner changes in equity (28,565) -
Comprehensive result (23,220) 7,024
The above comprehensive operating statement should be read in conjunction with the accompanying notes.
14 Melbourne & Olympic Parks Trust Balance Sheet for the financial year ended 30 June 2012
NOTE 2012 2011 $’000 $’000
ASSETS
FINANCIAL ASSETS Cash and cash equivalents (5) 62,194 38,717 Receivables (6) 3,251 3,060 TOTAL FINANCIAL ASSETS 65,445 41,777
NON-FINANCIAL ASSETS Property, plant and equipment and Intangible assets (7) 1,098,488 1,042,053 Other (8) 191 392 TOTAL NON-FINANCIAL ASSETS 1,098,678 1,042,445
TOTAL ASSETS 1,164,123 1,084,222
LIABILITIES Payables (9) 13,294 6,166 Provisions (10) 2,619 2,398 Other (11) 25,404 20,931 TOTAL LIABILITIES 41,317 29,495
NET ASSETS 1,122,806 1,054,727
EQUITY Accumulated surplus/(deficit) 196,247 190,903 Reserves 314,675 343,240 Contributed capital 611,884 520,584 NET WORTH 1,122,806 1,054,727
The above balance sheet should be read in conjunction with the accompanying notes.
Annual Report 2012 15 Statement of changes in equity for the financial year ended 30 June 2012
Notes Physical Asset Accumulated Contributions Total Revaluation Surplus By Owner $’000 Surplus $’000 $’000 $’000
Balance at 1 July 2010 343,240 183,879 482,984 1,010,103
Net Result for the Year 7,024 7,024
Transactions with owners in their 37,600 37,600 capacity as owners
Revaluation of Assets (7) - -
Balance at 30 June 2011 343,240 190,903 520,584 1,054,727
Net Result for the Year 5,344 5,344
Transactions with owners in their 91,300 91,300 capacity as owners
Revaluation of Assets (7) (28,565) (28,565)
Balance at 30 June 2012 314,675 196,247 611,884 1,122,806
The above statement of changes in equity should be read in conjunction with the accompanying notes.
16 Melbourne & Olympic Parks Trust Cash Flow Statement for the financial year ended 30 June 2012
NOTE 2012 2011 $’000 $’000
CASH FLOWS FROM OPERATING ACTIVITIES
RECEIPTS Receipts from customers 100,346 104,254 Customer receipts on behalf of suppliers (1d) 130,126 152,793 Interest received 1,501 643 Other Receipts 1,703 3,068 TOTAL RECEIPTS 233,676 260,758
PAYMENTS Payments to suppliers and employees (57,757) (84,417) Payments to suppliers on behalf of customers (1d) (130,126) (152,794) Goods and Services Tax paid to the ATO (i) (3,440) (3,221) TOTAL PAYMENTS (191,323) (240,432)
NET CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES (17b) 42,353 20,326
CASH FLOWS FROM INVESTING ACTIVITIES Payments for non-financial assets (110,176) (64,133)
NET CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES (110,176) (64,133)
CASH FLOWS FROM FINANCING ACTIVITIES Receipts from Government (capital) 91,300 37,600 Borrowing costs paid - (107)
NET CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES 91,300 37,493
Net increase/(decrease) in cash and cash equivalents 23,477 (6,314)
Cash and cash equivalents at the beginning of the financial year 38,717 45,031
CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR (17a) 62,194 38,717
The above cash flow statement should be read in conjunction with the accompanying notes. (i) Goods and Services Tax paid to/received from the ATO is presented on a net basis
Annual Report 2012 17 notes to financial Statements for the financial year ended 30 June 2012
1. SUMMARY OF SIGNIFICANT ACCOUNTING (c) Reporting Entity POLICIES The financial statements cover Melbourne and Olympic Parks Trust (the Trust) as an individual reporting entity. The Trust is a (a) Statement of Compliance government agency of the State of Victoria, established pursuant to the provisions of the Melbourne and Olympic Parks Act 1985. Its This general-purpose financial report has been prepared on principal address is: an accrual basis in accordance with the Financial Management Act 1994 (FMA), applicable Australian Accounting Standards Melbourne and Olympic Parks Trust (AAS), which includes the Australian accounting standards Batman Avenue issued by the Australian Accounting Standards Board (AASB). In Melbourne VIC 3001 particular, they are presented in a manner consistent with the requirements of AASB 1049 Whole of Government and General Government Sector Financial Reporting. (d) Scope and presentations of financial statements Comprehensive operating statement Accounting policies are selected and applied in a manner which Income and expenses in the comprehensive operating statement ensures that the resulting financial information satisfies the are classified according to whether or not they arise from concepts of relevance and reliability, thereby ensuring that the ‘transactions’ or ‘other economic flows’. This classification is substance of the underlying transactions or other events is reported. consistent with the whole of government reporting format and is allowed under AASB 101 Presentation of financial statements. To gain a better understanding of the terminology used in this report, a glossary of terms and style conventions can be found in Note 23. ‘Transactions’ and ‘other economic flows’ are defined by the Australian system of government finance statistics: concepts, (b) Basis of accounting preparation and measurement sources and methods 2005 and Amendments to Australian The accrual basis of accounting has been applied in the System of Government Finance Statistics, 2005 Cat. No. 5514.0 preparation of these financial statements whereby assets, published by the Australian Bureau of Statistics. liabilities, equity, income and expenses are recognised in the reporting period to which they relate, regardless of when cash is ‘Transactions’ are those economic flows that are considered received or paid. to arise as a result of policy decisions, usually interactions between two entities by mutual agreement. Transactions also In the application of AASs, management is required to make include flows within an entity, such as depreciation where the judgements, estimates and assumptions about carrying values owner is simultaneously acting as the owner of the depreciating of assets and liabilities that are not readily apparent from other asset and as the consumer of the service provided by the sources. The estimates and associated assumptions are based asset. Taxation is regarded as mutually agreed interactions on historical experience and various other factors that are between the Government and taxpayers. Transactions can be believed to be reasonable under the circumstance, the results in kind (e.g. assets provided/given free of charge or for nominal of which form the basis of making the judgments. Actual results consideration) or where the final consideration is cash. may differ from these estimates. ‘Other economic flows’ are changes arising from market re- The estimates and underlying assumptions are reviewed on an measurements. They include gains and losses from disposals, ongoing basis. Revisions to accounting estimates are recognised revaluations and impairments of non-current physical and in the period in which the estimate is revised if the revision intangible assets; actuarial gains and losses arising from affects only that period or in the period of the revision, and defined benefit superannuation plans; fair value changes of future periods if the revision affects both current and future financial instruments and agricultural assets; and depletion of periods. Judgements and assumptions made by management natural assets (non-produced) from their use or removal. in the application of AASs that have significant effects on the financial statements and estimates relate to: The net result is equivalent to profit or loss derived in accordance with AASs. · the fair value of land, buildings, infrastructure, plant and equipment, (refer to Note 1(i)); Balance sheet · superannuation expense (refer to Note 1(h)); and Assets and liabilities are presented in liquidity order with assets · actuarial assumptions for employee benefit provisions based aggregated into, financial assets and non-financial assets. on likely tenure of existing staff, patterns of leave claims, future salary movements and future discount rates (refer to Current and non-current assets and liabilities (those expected Note 1(j)). to be recovered or settled beyond 12 months) are disclosed in the notes, where relevant. These financial statements are presented in Australian dollars, the functional and presentation currency of the Trust. Cash flow statement Accounting policies are selected and applied in a manner which Cash flows are classified according to whether or not they ensures that the resulting financial information satisfies the arise from operating activities, investing activities, or financing concepts of relevance and reliability, thereby ensuring that the activities. This classification is consistent with requirements substance of the underlying transactions or other events is reported. under AASB 107 Statement of cash flows.
The accounting policies set out below have been applied in For cash flow statement presentation purposes, cash and cash preparing the financial statements for the year ended 30 June equivalents include bank overdrafts, which are included as 2012 and the comparative information presented for the year current borrowings on the balance sheet. ended 30 June 2011.
18 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
Customer receipts on behalf of suppliers and Payments to suppliers Interest revenue on behalf of customers represents cash received for event ticket Interest income is recognised on a time proportionate basis that sales which is held in Trust from the time tickets are purchased and takes into account the effective yield on the financial asset. paid out to the hirer after the event has taken place. Other income Statement of changes in equity Sinking fund income is recognised as income in the reporting period in which the Trust gains control over the underlying assets. The statement of changes in equity presents reconciliations of non-owner and owner changes in equity from opening balance at the beginning of the reporting period to the closing balance Any gain or loss on disposal of non-current assets is recognised at the end of the reporting period. It also shows separately at the date control of the asset is passed to the buyer and is changes due to amounts recognised in the ‘Comprehensive determined after deducting from the proceeds the carrying result’ and amounts recognised in ‘Other economic flows – value of the asset at that time. other movements in equity’ related to ‘Transactions with owner in its capacity as owner’. (h) Expenses Payments to third parties are recognised as an expense in the (e) Events after reporting date reporting period in which they are paid or are payable. Assets, liabilities, income or expenses arise from past transactions or other past events. Where the transactions Employee benefits result from an agreement between the Trust and other parties, Refer to the section in Note 1 (j) regarding employee benefits. the transactions are only recognised when the agreement is irrevocable at or before the end of the reporting period. These expenses include all costs related to employment (other than superannuation which is accounted for separately) Adjustments are made to amounts recognised in the financial including wages and salaries, fringe benefits tax, leave statements for events which occur after the reporting period entitlements, redundancy payments and WorkCover premiums. and before the date the financial statements are authorised for issue, where those events provide information about conditions Details of the funds which the Trust made superannuation which existed in the reporting period. Note disclosure is made contributions to during the year are disclosed in Note 21. about events between the end of the reporting period and the date the financial statements are authorised for issue where Depreciation the events relate to conditions which arose after the end of the In compliance with Australian Accounting Standard AASB116, reporting period and which may have a material impact on the depreciation has been charged on all fixed assets and capital results of subsequent reporting periods. works developments, with the exception of Land. The provisions for depreciation are made using the straight-line method, at (f) Goods and services tax (GST) rates appropriate to the estimated useful life to the Trust of each individual asset. Estimates of the remaining useful lives Income, expenses and assets are recognised net of the amount for all assets are reviewed annually and range from greater of associated GST, unless the GST incurred is not recoverable than zero up to seventy years. The trust’s policy is to capitalise from the taxation authority. In this case it is recognised as part assets valued over $1,000, whilst assets of less than $1,000 in of the cost of acquisition of the asset or as part of the expense. value are expensed immediately. Receivables and payables are stated inclusive of the amount of The following are typical estimated useful lives for different GST receivable or payable. The net amount of GST recoverable asset classes for both current and prior years: from, or payable to, the taxation authority is included with other receivables or payables in the balance sheet.
Cash flows are presented on a gross basis. The GST Asset Class Useful Life components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation Buildings 15-60 years authority, are presented as operating cash flows. Property Plant & Equipment 5 years Motor Vehicles 5 years (g) Revenue Intangible Assets 5 years Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of Impairment of assets returns, trade allowances and duties and taxes. All of the Trust’s assets are assessed annually for indications of impairment, except for inventories. Revenue from sale of goods and services Revenue from the sale of goods and services is recognised upon If there is an indication of impairment, the assets concerned are delivery of the goods and services to the customer and when tested as to whether their carrying value exceeds their possible the Trust gains control of the underlying assets. recoverable amount. Where an asset’s carrying value exceeds its recoverable amount, the difference is written off by a charge Grants to the comprehensive operating statement except to the extent Grants from third parties are recognised as income in the reporting that the write-down can be debited to an asset revaluation period in which the Trust gains control over the contribution. reserve amount applicable to that class of asset.
Annual Report 2012 19 notes to financial Statements for the financial year ended 30 June 2012
It is deemed that, in the event of the loss of an asset, the in accordance with FRD 103D issued by the Minister for Finance. future economic benefits arising from the use of the asset A full revaluation occurs at least every five years, based on will be replaced unless a specific decision to the contrary has the asset’s government purpose classification, but may occur been made. The recoverable amount of most major assets is more frequently if fair value assessments indicate material measured at the higher of the depreciated replacement cost and changes in values. Independent valuers are used to conduct fair value less costs to sell. The depreciated replacement cost is these scheduled revaluations and any interim revaluations are the current replacement cost of an asset less, where applicable, determined in accordance with the requirements of the FRDs. accumulated depreciation calculated on the basis of such cost to reflect the already consumed or expired future economic Revaluation increases or decreases arise from differences benefits of the asset. between an asset’s carrying value and fair value.
Supplies and services Revaluation increases are credited directly to equity in the Supplies and services are recognised as an expense in the revaluation reserve, except that, to the extent that an increment reporting period in which they are incurred. reverses a revaluation decrement in respect of that class of asset previously recognised as an expense in the net result, the increment is recognised as income in determining the net result. (i) Assets All non-current assets controlled by the trust are reported in the Revaluation decreases are recognised immediately as expenses balance sheet. in the net result, except that, to the extent that a credit balance exists in the revaluation reserve in respect of the same class of Cash and cash equivalents assets, they are debited to the revaluation reserve. Cash and deposits, including cash equivalents, comprise cash on hand and cash at bank, deposits at call and those highly Revaluation increases and revaluation decreases relating to liquid investments with an original maturity of three months individual assets within a class of property, plant and equipment or less, which are held for the purpose of meeting short term are offset against one another within that class but are not cash commitments rather than for investment purposes, and offset in respect of assets in different classes. which are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. (j) Liabilities Payables For cash flow statement presentation purposes, cash and cash equivalents includes bank overdrafts, which are included as Payables are recognised when the Trust becomes obliged to borrowings on the balance sheet. make future payments resulting from the purchase of goods and services. Receivables Interest bearing liabilities Receivables consist of: Interest bearing liabilities are initially measured at fair · statutory receivables, which include predominantly amounts value, being the cost of the interest bearing liabilities, net of owing from the Victorian Government and GST input tax transaction costs. credits recoverable; and Subsequent to initial recognition, interest bearing liabilities · contractual receivables, which include mainly debtors in are measured at amortised cost with any difference between relation to goods and services, loans to third parties, accrued the initial recognised amount and the redemption value being investment income and finance lease receivables (refer to recognised in profit and loss over the period of the interest Note 12 Leases) bearing liability using the effective interest rate method. Receivables that are contractual are classified as financial instruments. Statutory receivables are not classified as financial Provisions instruments. Provisions are recognised when the Trust has a present obligation, the future sacrifice of economic benefits is probable Receivables are recognised initially at fair value and and the amount of the provision can be measured reliably. subsequently measured at amortised cost, using the effective interest method, less an allowance for impairment. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting A provision for doubtful receivables is made when there is date, taking into account the risks and uncertainties surrounding objective evidence that the debts will not be collected. Bad debts the obligation. Where a provision is measured using the cash flows are written off when identified. estimated to settle the present obligation, its carrying amount is the present value of those cash flows, using a discount rate that Inventories reflects the time value of money and risks specific to the provision. Inventories are measured at the lower of cost and net realisable value. Employee Benefits Property, plant and equipment (i) Wages, Salaries and Annual Leave Land, buildings and plant and equipment are recognised Liabilities for wages and salaries, including non-monetary initially at cost and subsequently measured at fair value less benefits and annual leave expected to be settled within 12 accumulated depreciation. months of the reporting date are recognised in the provision for employee benefits in respect of employee services up to the Revaluations of Non-Current Physical Assets reporting date, classified as current liabilities and measured at Non-current physical assets measured at fair value are revalued their nominal values.
20 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
Those liabilities that are not expected to be settled within 12 (k) Income taxes months are recognised in the provision for employee benefits The Australian Taxation Office has deemed the Trust to be a as current liabilities, measured at present value of the amounts “Public Authority” within the terms of Section 50-25 of the expected to be paid when the liabilities are settled using the Income Tax Assessment Act 1997 and therefore any income remuneration rate expected to apply at the time of settlement. shall be exempt from income tax. The Trust is not subject to the State Equivalent Income Tax System. No provisions for income (ii) Long Service Leave taxes payable have been raised. A liability for long service leave is recognised, and is measured as the present value of expected future payments to be made in (l) Contingent assets and contingent liabilities respect of services provided by employees up to the reporting date. Consideration is given to expected future wage and salary Contingent assets and contingent liabilities are not recognised levels, experience of employee departures and period of service. in the balance sheet, but are disclosed by way of a note and, if All unconditional vested long service leave representing 7 years quantifiable, are measured at nominal value. or greater of continuous service is disclosed in accordance with AASB 101, as a current liability. Expected future payments are (m) Cash flow statement measured at nominal value where a component of this current For the purposes of the cash flow statement, cash comprises is expected to fall due within 12 months after the end of the petty cash, cash floats, deposits in bank accounts, cash held in period and discounted where the Trust does not expect to settle trust (ticket sales for future events) and short-term deposits. a component of this liability within 12 months. Discount rates are based on interest rates on national Government guaranteed securities with terms to maturity that match, as closely as (n) Rounding of Amounts possible, the estimated future cash outflows. Amounts in the financial report have been rounded to the nearest thousand dollars, or in other cases, to the nearest dollar. Liability for long service leave (LSL) is recognised in the provision for employee benefits. (o) Contributed Capital • Current liability unconditional LSL (representing seven or Transfers from the Department for Planning Community & more years of continuous service for staff) is disclosed as a Development (DPCD) that are in the nature of contributions or current liability even where the Trust does not expect to settle distributions of capital have also been designated as contributed the liability within 12 months because it will not have the capital. Other transfers that are in the nature of contributions or unconditional right to defer the settlement of the entitlement distributions have also been designated as contributions by owners. should an employee take leave within 12 months. (p) Intangible Assets The components of this current LSL liability are measured at: Intangible assets represent identifiable non-monetary assets without physical substance. Intangible assets are recognised – Present value – component that the Trust does not expect to at cost. Cost incurred subsequent to initial acquisition are settle within 12 months; and capitalised when it is expected that additional future economic – Nominal value – component that the Trust expects to settle benefits will flow to the Trust. within 12 months.
• Non-current liability – conditional LSL (representing less (q) Leased Assets than seven years of continuous service for staff) is disclosed Leases are classified as finance leases whenever the terms as a non-current liability. There is an unconditional right to of the lease transfer substantially all the risks and rewards to defer the settlement of the entitlement until the employee has the lessee. All other leases are classified as operating leases. completed the requisite years of service. Assets held under finance leases are recognised as assets of the Trust at their fair value or, if lower, at the present value of This non-current LSL liability is measured at present value. the minimum lease payments, each determined at the inception of the lease. The corresponding liability to the lessor is included (iii) Termination benefits in the balance sheet as a finance lease obligation. Termination benefits are payable when employment is terminated before the normal retirement date, or when an (r) Australian Accounting Standards issued that are employee accepts voluntary redundancy in exchange for these not yet effective benefits. The Trust recognises termination benefits when it is Certain new AASs have been published that are not mandatory demonstrably committed to either terminating the employment for the 30 June 2012 reporting period. DTF assesses the of current employees according to a detailed formal plan impact of these new standards and advises the Trust of their without possibility of withdrawal or providing termination applicability and early adoption where applicable. 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. As at 30 June 2012, the following standards and interpretations had been issued but were not mandatory for the financial year ending Employee Benefit On-costs 30 June 2012. The Trust has not early adopted these standards. Employee benefits on-costs (payroll tax, workers compensation, superannuation, annual leave and LSL accrued while on LSL taken in service) are recognised and included when determining employee benefit liabilities.
Annual Report 2012 21 notes to financial Statements for the financial year ended 30 June 2012
Standard/Interpretation Summary Applicable Impact on public sector entity financial for annual statements reporting periods beginning on
AASB 9 Financial instruments This standard simplifies Beginning Detail of impact is still being assessed. requirements for the classification 1 Jan 2013 and measurement of financial assets resulting from Phase 1 of the IASB’s project to replace IAS 39 Financial Instruments: Recognition and Measurement (AASB 139 Financial Instruments: Recognition and Measurement).
AASB 13 Fair Value This Standard outlines the 1 Jan 2013 Disclosure for fair value measurements Measurement requirements for measuring the using unobservable inputs are relatively fair value of assets and liabilities onerous compared to disclosure and replaces the existing fair value for fair value measurements using definition and guidance in other observable inputs. Consequently, the AASs. AASB 13 includes a ‘fair value Standard may increase the disclosures hierarchy’ which ranks the valuation for public sector entities that have technique inputs into three levels assets measured using depreciated using unadjusted quoted prices in replacement cost. active markets for identical assets or liabilities; other observable inputs; and unobservable inputs.
AASB 119 Employee Benefits In this revised Standard for defined 1 Jan 2013 Not-for-profit entities are not permitted benefit superannuation plans, there to apply this Standard prior to the is a change to the methodology in mandatory application date. the calculation of superannuation While the total superannuation expense expenses, in particular there is is unchanged, the revised methodology now a change in the split between is expected to have a negative impact superannuation interest expense on the net result from transactions of (classified as transactions) and the general government sector and for actuarial gains and losses (classified those few Victorian public sector entities as ‘Other economic flows – other that report superannuation defined movements in equity’) reported benefit plans. on the comprehensive operating statement.
AASB 1053 Application of This Standard establishes a Beginning 1 The Victorian Government is currently Tiers of Australian Accounting differential financial reporting July 2013 considering the impacts of Reduced Standards framework consisting of two tiers Disclosure Requirements (RDRs) for of reporting requirements for certain public sector entities and has not preparing general purpose financial decided if RDRs will be implemented to statements. the Victorian Public Sector.
2012-1 Amendments to This amending Standard prescribes 1 July 2013 As the Victorian whole of government Australian Accounting the reduced disclosure requirements and the general government (GG) Standards - Fair Value in a number of Australian Accounting sector are subject to Tier 1 reporting Measurement - Reduced Standards as a consequence of requirements (refer to AASB 1053 Disclosure Requirements the issuance of AASB 13 Fair Value Application of Tiers of Australian [AASB 3, AASB 7, AASB 13, Measurement. Accounting Standards), the reduced AASB 140 & AASB 141] disclosure requirements included in AASB 2012-1 will not affect the financial reporting for Victorian whole of government and GG sector.
There are a number of non-mandatory standards at 30 June 2012 not listed which have been assessed to have minimal or no impact to the Trust.
22 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
2. INCOME FROM TRANSACTIONS
2012 2011 $’000 $’000
(a) Sales of goods and services Sale of goods 38,174 36,101 Rendering of services 58,388 58,045 Royalties 3,773 3,600 100,335 97,746
(b) Interest Interest on bank deposits 1,501 643 1,501 643
(c) Grants Other public bodies 820 2,143 820 2,143
(d) Other income Delaware North Sinking Fund 429 435 Tennis Australia Special Purpose Account 540 567 969 1,002
Annual Report 2012 23 notes to financial Statements for the financial year ended 30 June 2012
3. EXPENSES FROM TRANSACTIONS
2012 2011 $’000 $’000
(a) Cost of goods/sold distributed Venue Hire 2,553 1,893 Catering 32,414 28,220 Other 183 296 35,150 30,409
(b) Purchase of services Purchase of services 15,351 14,241 15,351 14,241
(c) Employee expenses Defined contribution superannuation expense 1,293 1,317 Termination benefits 17 38 Salaries, wages and long service leave 15,995 15,858 17,305 17,213
(d) Interest expense Interest on government loans - 107 - 107
(e) Depreciation Depreciation of non-current assets 25,175 26,514 25,175 26,514
(f) Other operating expenses Maintenance 4,104 4,355 Operating lease expenses 264 251 Purchase of supplies and consumables 867 935 Bad debts from transactions - 5 Other 218 389 5,453 5,935
24 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
4. OTHER ECONOMIC FLOWS INCLUDED IN NET RESULT
2012 2011 $’000 $’000
(a) Net gain/(loss) on non-financial assets Net gain/(loss) on disposal of property plant and equipment (86) (77) (including intangible assets) (86) (77)
(b) Net gain/(loss) arising from revaluation of long service liability Net gain/(loss) arising from revaluation of long service liability 240 (14) 240 (14)
5. CASH AND CASH EQUIVALENTS 2012 2011 $’000 $’000
Cash floats held 42 43 Cash on hand 36,412 18,289 Term deposits 2,000 2,000 Bank deposits (restricted use) 1,565 1,453 Cash held in trust (not available for use) 22,175 16,932 62,194 38,717
6. RECEIVABLES
2012 2011 $’000 $’000
Current Contractual Other receivables (ii) 1,872 2,789 1,872 2,789 Statutory Amount owing from Victorian Government (i) 364 276 Taxes Recoverable 1,020 - Provision for doubtful debts (iii) (5) (5) 1,379 271
Total current receivables 3,251 3,060
(i) The amounts receivable from the Victorian Government represent monies owing from Victorian Government Departments/Agencies relating to contributions towards capital projects, tenancies and redevelopment costs. (ii) Receivables are carried at nominal amounts due. The average credit period on settling of monies owed is 7 days. No interest is charged on other receivables for outstanding balances. (iii) A provision has been made for amounts where collection is considered no longer probable, determined by reference to issues relating to individual accounts.
Annual Report 2012 25 notes to financial Statements for the financial year ended 30 June 2012
(a) Movement in the allowance for doubtful debts
2012 2011 $’000 $’000
Balance at beginning of financial year 5 - Increase/(decrease) in allowance recognised in profit or loss - 5 Balance at end of financial year 5 5
(b) Ageing analysis of receivables Please refer to Table 16.2 in Note 16 for ageing analysis of receivables.
(c) Nature and extent of risk arising from receivables Please refer to Note 16 for the nature and extent of credit risk arising from receivables.
7. PROPERTY, PLANT, EQUIPMENT AND INTANGIBLE ASSETS.
2012 2011 $’000 $’000
Land at fair value 2012 (i) 387,600 440,525 387,600 440,525
Buildings and improvements (last independent valuation 2012 (ii) 458,158 423,637 Buildings at cost 58 292,619 Less accumulated depreciation (4) (248,207) Written down value 458,212 468,049
Plant and equipment (last independent valuation 2012 (ii) 93,074 102,285 Plant and equipment at cost 15,821 49,870 Less accumulated depreciation (6,952) (67,812) Written down value 101,943 84,343
Work in progress 150,428 48,940 150,428 48,940
Total property, plant and equipment 1,105,139 1,357,876 Less accumulated depreciation (6,956) (316,019) Written down value 1,098,183 1,041,857
Intangible Assets 898 697 Less accumulated amortisation (594) (501) Written down value 304 196
Written down value property, plant, equipment and intangible assets 1,098,488 1,042,053
26 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
Reconciliations Classification by ‘Public safety and environment’ purpose group – Movements in carrying amounts
Land Buildings Plant & Intangibles Work in Total Equipment Progress $’000 $’000 $’000 $’000 $’000 $’000 Year ended 30 June 2012 Carrying amount at start of year 440,525 468,049 84,343 196 48,940 1,042,053 Additions - - - - 109,680 109,680 Transfers - 756 7,235 202 (8,192) - Disposals - 496 - - - 496 Revaluations/Impairments (52,925) 7,650 16,709 - - (28,565) Depreciation Expense - (18,739) (6,343) - - (25,082) Amortisation Expense - - - (93) - (93) Carrying amount at end of year 387,600 458,212 101,943 304 150,428 1,098,488
Land Buildings Plant & Intangibles Work in Total Equipment Progress $’000 $’000 $’000 $’000 $’000 Year ended 30 June 2011 Carrying amount at start of year 440,525 483,149 72,848 144 7,768 1,004,434 Additions - - - - 64,315 64,315 Transfers - 5,527 17,516 100 (23,143) - Disposals - - (182) - - (182) Revaluations/Impairments ------Depreciation Expense - (20,628) (5,838) - - (26,466) Amortisation Expense - - - (48) - (48) Carrying amount at end of year 440,525 468,049 84,343 196 48,940 1,042,053
(i) Land at fair value June 30 2012 Land was last independently revalued at June 30 2012 as required by the Financial Management Act 1994 and was conducted by the Valuer-General Victoria. Due to restrictions on the usage of the land, a notional discount of 40% known as ‘Community Service Obligation’ has been applied to the Unrestricted Land Value. (ii) Buildings and Improvements and Plant and Equipment at revaluation 2012 Buildings, Plant & Equipment was last independently revalued at June 30 2012 as required by the Financial Management Act 1994 and was conducted by Napier & Blakeley on behalf of the Valuer-General Victoria who have provided replacement cost and depreciated replacement cost on the inspected properties (Rod Laver Arena and surrounding grounds, Hisense Arena, AAMI Park and Westpac Centre). Works in Progress relating to the redevelopment have not been included in the revaluation. (iii) Carrying amount at end of year Work in Progress at June 30 2012 includes $140.5m relating to Stage 1 of the Melbourne Park Redevelopment (Eastern Plaza and Margaret Court Arena redevelopment), which is due for completion in 2015.
(iv) Accumulated Depreciation The reporting requirements of FRD103D (4.18) Non-Current Physical Assets requires accumulated depreciation on revalued assets to be eliminated against the gross carrying amount of the asset. Therefore the accumulated depreciation in the current year relates to assets at cost only. The accumulated depreciation for the prior year includes revalued assets whose accumulated depreciation has been eliminated as required by FRD103D (4.18).
Annual Report 2012 27 notes to financial Statements for the financial year ended 30 June 2012
8. OTHER ASSETS 2012 2011 $’000 $’000
Current Prepayments 191 392 191 392 9. PAYABLES
2012 2011 $’000 $’000
Current Contractual
Trade creditors (i) 692 946 Other payables 2,706 513 Accrued expenses 9,843 4,392 13,241 5,851 Statutory Taxes payable 53 315
Total current payables 13,294 6,166
(i) The average credit period is 30 days. No interest is charged on other payables for the first 30 days from the date of invoice. Payables are generally paid within the payment period thereby avoiding any interest charges that may be incurred on late payments.
(a) Maturity analysis of payables Please refer to Table 16.3 in Note 16 for the aging analysis of payables.
(b) Nature and extent of risk arising from payables Please refer to Note 16 for the nature and extent of risks arising from payables.
10. PROVISIONS
2012 2011 $’000 $’000
Current Employee benefits - Unconditional and expected to be settled within 12 months (i) 1,497 1,443 Employee benefits - Unconditional and expected to be settled after 12 months (ii) 660 590 2,157 2,033
Non-current Employee benefits - long service leave (ii) 462 365
Total Provisions 2,619 2,398
(i) The amounts disclosed are nominal amounts. (ii) The amounts disclosed are discounted to present values.
28 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
11. OTHER LIABILITIES
2012 2011 $’000 $’000
Income received in advance 3,229 3,999 Ticket sales for future events held in trust 22,175 16,932 25,404 20,931
12. LEASES
Disclosure of operating leases
Operating Lease Payables
Leasing arrangements Operating lease payables relate to plant and office equipment with lease terms between 1 and 7 years.
Non-cancellable operating leases Total lease expenditure contracted for at balance date but not provided for in the accounts:
2012 2011 $’000 $’000
Payable no later than one year 180 207 Later than one year and not later than five years 355 499 Later than five years - - 535 706
Operating Lease Receivables
Leasing arrangements Operating lease receivables relate to 12 tenancies (13 in 2010-11) within the Trust’s precinct with lease terms between 2 and 24 years.
2012 2011 $’000 $’000
Receivable no later than one year 4,005 3,836 Later than one year and not later than five years 14,975 14,317 Later than five years 47,119 24,735 66,099 42,888
13. COMMITMENTS FOR EXPENDITURE The following commitments have not been recognised as liabilities in the financial statements. All amounts shown in the commitments note are nominal amounts inclusive of GST.
(a) Capital expenditure commitments At the date of this report, the Trust had $0.950 million in commitments for capital works (2011: $0.950m).
(b) Lease commitments Non-cancellable operating lease commitments are disclosed in Note 12 to the financial statements.
14. CONTINGENT LIABILITIES The Trust has no contingent liabilities at the date of this report. Annual Report 2012 29 notes to financial Statements for the financial year ended 30 June 2012
15. CONTINGENT ASSETS The Trust has no contingent assets at the date of this report.
16. FINANCIAL INSTRUMENTS
(a) Significant accounting policies 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, with respect to each class of financial asset, financial liability and equity instrument are disclosed in Note 1 to the financial statements.
(b) Table 16.1: Categorisation of financial instruments
notes Carrying amount Carrying amount 2012 2011 $’000 $’000
(i) Financial assets Cash and cash equivalents 5 62,194 38,717 Receivables (i) 6 1,872 2,789
(ii) Financial liabilities Payables (i) 9 13,241 5,851
Other liabilities 11 25,404 20,931
(i) The amount of receivables and payables disclosed exclude statutory amounts (eg: amounts owing from Victorian Government and GST input tax credit recoverable and taxes payable)
(c) Credit risk exposure
Credit risk arises when there is the possibility of the Trust’s debtors defaulting on their contractual obligations resulting in financial loss to the Trust. The Trust measures credit risk on a fair value basis and monitors risk on a regular basis.
The Trust does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The Trust has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral or credit enhancements where appropriate, as a means of mitigating the risk of financial loss from defaults. Credit risk in trade receivables is managed by payment terms of seven days and sound debt collection policies and procedures. In addition, the Trust does not engage in any hedging for its financial assets. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies. Provision of impairment for financial assets is calculated based on past experience, and current and expected changes in client credit ratings. The carrying amount of financial assets recorded in the Financial Report, net of any allowances for losses, represents the Trust’s maximum exposure to credit risk without taking account of the value of any collateral obtained. Financial assets that are either past due or impaired Currently the Trust does not hold any collateral as security nor credit enhancements relating to any of its financial assets. As at the reporting date, there is no event to indicate that any of the financial assets are impaired. 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 ageing only of financial assets that are past due but not impaired:
30 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
Table 16.2: Interest rate exposure and ageing analysis of financial assets
Carrying Interest rate Not past Past due but not impaired amount exposure due & not impaired Variable Non- Less 1-3 3 1-5 interest interest than 1 months months years rate bearing month - 1 year $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 30 June 2012 Receivables (i) 1,872 - 1,872 1,635 116 58 62 1 1,872 - 1,872 1,635 116 58 62 1 30 June 2011
Receivables (i) 2,789 - 2,789 1,924 263 364 237 - 2,789 - 2,789 1,924 263 364 237 -
(i) Ageing analysis of financial assets excludes statutory financial assets (eg: amounts owing from Victorian Government and GST input tax credits recoverable)..
(d) Liquidity risk
Liquidity risk arises when the Trust is unable to meet its financial obligations as they fall due. The Trust operates under the Government fair payments policy of settling financial obligations within 30 days and in the event of a dispute, makes payments within 30 days from the date of resolution. It also continuously manages risk through monitoring future cash flows and maturities planning to ensure adequate holding of high quality liquid assets and dealing in highly liquid markets.
The Trust’s exposure to liquidity risk is deemed insignificant based on prior periods’ data and current assessment of risk. Cash for unexpected events could be sourced from early liquidation of cash held on deposit if required.
Maximum exposure to liquidity risk is the carrying amounts of financial liabilities.
Table 16.3: Interest rate exposure and maturity analysis of financial liabilities
Carrying Interest rate Nominal Maturity dates (i) amount exposure amount Variable Non- Less 1-3 3 1-5 interest interest than 1 months months years rate bearing month - 1 year $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 30 June 2012 Payables (ii) 13,241 - 13,241 13,241 13,232 3 6 - Other 25,404 - 25,404 25,404 6,946 4,768 6,446 7,244 38,645 - 38,645 38,645 20,178 4,771 6,452 7,244 30 June 2011 Payables (ii) 5,851 - 5,851 5,851 5,647 102 102 - Other 20,931 - 20,931 20,931 3,141 2,516 14,000 1,274 26,782 - 26,782 26,782 8,789 2,618 14,102 1,274
(i) The amounts disclosed are the contractual undiscounted cash flows of each class of financial liabilities. (ii) The carrying amounts disclosed exclude statutory amounts (eg: amounts payable to Victorian Government and taxes payable).
Annual Report 2012 31 notes to financial Statements for the financial year ended 30 June 2012
(e) Market risk
The Trust’s exposures to market risk, including interest rate risk and foreign currency are insignificant. Objectives, policies and processes used to manage each of these risks are disclosed in the paragraphs below.
Foreign currency risk The Trust is exposed to insignificant foreign currency risk through its payables relating to purchases of supplies and consumables from overseas, due to the limited amount of purchases denominated in foreign currencies and the short timeframe between commitment and settlement.
The Trust manages its risk through continuous monitoring of movements in exchange rates against the US Dollar and ensures availability of funds through cash flow planning and monitoring. Based on past and current assessment of economic outlook, it is deemed unnecessary for the Trust to enter into any hedging arrangements to manage the risk.
The Trust’s exposure to foreign currency risk is set out in Table 16.4.
Interest rate risk The Trust is exposed to insignificant interest rate risk as it does not have any loans and money on term deposit is with financial institutions with high credit ratings.
The Trust’s exposure to interest rate risk is set out in Table 16.4.
Table 16.4: Market risk
Foreign exchange Interest rate risk risk
-10% 10% -1% +1% Carrying Profit Equity (100 basis points) (100 basis points) amount Profit Equity Profit Equity 30 June 2012 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Financial Assets: Cash and cash equivalents (i) 62,194 - - (622) (622) 622 622
30 June 2011 Financial Assets: Cash and cash equivalents (i) 38,717 - - (387) (387) 387 387
(i) Sensitivity of cash and cash equivalents to a +1% movement in rates: ($62,194k x 0.055)-($62,194k x 0.045) = $621k. Similarly for a -1% movement in interest rate, impact = ($621k). Source: TCV Monthly Economic & Interest Rate Update – June 2012 (Forecast cash rate Jun-13: 3.25%, Actual cash rate Jun-12 3.50%).
(f) Fair value
The Trust considers that the carrying amount of financial assets and financial liabilities recorded in the financial report to be a fair approximation of their fair values, because of the short-term nature of the financial instruments and the expectation that they will be paid in full.
32 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
17. CASH FLOW INFORMATION
(a) Reconciliation of cash and cash equivalents
2012 2011 $’000 $’000
Total cash and cash equivalents disclosed in note 5 62,194 38,717 Balance as per cash flow statement 62,194 38,717
(b) Reconciliation of net result for the period to net cash flows from operating activities
2012 2011 $’000 $’000
Operating profit/(deficit) for the financial year 5,345 7,024
Add/(less) non-cash movements: Depreciation and amortisation of non-current assets 25,175 26,515
Movements included in investing and financing activities: Borrowing costs paid - 107
Movements in assets and liabilities: (Increase)/decrease in current receivables (191) 6,687 (Increase)/decrease in other current assets 202 (179) (Decrease)/increase in current payables 7,128 (4,765) (Decrease)/increase in current provisions 124 209 (Decrease)/increase in other current liabilities 4,473 (15,256) (Decrease)/increase in non-current provisions 97 (15)
Net cash flows from/(used in) operating activities 42,353 20,327
Annual Report 2012 33 notes to financial Statements for the financial year ended 30 June 2012
18. RESPONSIBLE PERSONS In accordance with the Ministerial Directions issued by the Minister for Finance under the Financial Management Act 1994, the following disclosures are made regarding responsible persons for the reporting period.
Names The persons who held the positions of Ministers and Accountable Officers for the Trust are as follows:
Premier The Honourable Ted Baillieu, Premier of Victoria
Minister The Honourable Hugh Delahunty, Minister for Sport and Recreation
Trust Mr Russell Caplan (Chairperson) Ms Deborah Beale (to 26/05/12) Mr John Howie (to 24/03/12) Mr Tim Jacobs Ms Kate Joel Ms Elizabeth (Sue) Nattrass, AO Ms Diana Nicholson Mr Geoffrey Pollard, AM Mr Raymond Smith Mr David Stobart Mr Scott Tanner The Honourable John Cain
Chief Executive Officer Mr Brian Morris
Remuneration Total remuneration (including incentive payments) received or receivable by the Accountable Officer in connection with the management of the Trust during the reporting period was in the range of $390,000 - $399,999 ($390,000 - $399,999 in 2010-11). Trustees did not receive any remuneration from the Trust during the financial year. (2010-11: $0).
Related party transactions Commercial dealings were undertaken during the reporting period with Tennis Australia and Tennis Victoria, both of which have representatives holding positions as Trustees on the Melbourne & Olympic Parks Trust.
During 2011-12, the Trust invoiced Tennis Australia $26,107,031 ($25,534,055 in 2010-11) and as at 30 June 2012, Tennis Australia owed the Trust $598,021 ($567,781 at 30 June 2011). Mr Scott Tanner holds a position on the Melbourne & Olympic Parks Trust and also holds a position at Tennis Australia (Director). Tennis Australia is the promoter of the Australian Open event, runs a court hire business on the Trust’s premises and rents office space from the Trust.
During 2011-12, the Trust invoiced Tennis Victoria $169,561 ($152,469 in 2010-11) and at 30 June 2012, Tennis Victoria owed the Trust $630 ($0 at 30 June 2011). Mr David Stobart holds a position on the Melbourne & Olympic Parks Trust and also holds the position of President of Tennis Victoria. Tennis Victoria rents office space on the Trust’s premises and purchase related services from the Trust.
There are no other receivable amounts or loans outstanding in relation to related parties, as at 30 June 2012.
34 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
19. REMUNERATION OF EXECUTIVES The number of Executive Officers, other than the Accountable Officer, and their total remuneration during the reporting period are shown in the first two columns in the table below in their relevant income bands. The base remuneration of Executive Officers is shown in the third column and a comparative to the prior year in the fourth column. Base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits.
Income band Total Remuneration Base Remuneration 2012 2011 2012 2011 No. No. No. No. < $99,999 - - - 1 $100,000 - $109,999 1 2 1 3 $110,000 - $119,999 4 2 5 1 $120,000 - $129,999 3 - 2 1 $130,000 - $139,999 2 3 2 1 $140,000 - $149,999 2 1 2 2 $150,000 - $159,999 1 - 1 1 $160,000 - $169,999 1 2 1 - $190,000 - $199,999 - 1 - 1 $200,000 - $209,999 1 1 1 1 $220,000 - $229,999 1 - 1 - Total numbers 16 12 16 12
Total remuneration 2,243 1,699 2,233 1,619
20. REMUNERATION OF AUDITORS
Audit fees paid or payable to the Victorian Auditor-General’s Office for the audit of the Trust’s financial report and Ernst and Young (up to Dec-11) and KPMG (from Jan-12) for the Trust’s internal audit program:
2012 2011 $’000 $’000
Audit or review of the financial statements 52 51 Internal audit services 83 84 Other non-audit services - 18 135 153
Annual Report 2012 35 notes to financial Statements for the financial year ended 30 June 2012
21. EMPLOYEE SUPERANNUATION Superannuation contributions for the reporting period are included as part of employee benefits and on-costs in the comprehensive operating statement of the Trust.
The name and details of the major employee superannuation funds and contributions (above $10,000) made by the Trust during the reporting period are as follows:
2012 2011 $’000 $’000
AustralianSuper 918 959 Navigator Super Solutions 139 165 Hostplus 68 74 VicSuper 37 31 Retail Employees Superannuation 26 26 Colonial First State Super 18 17 Mumme Freeburn Executive Super Fund 18 17 Combined Fund Pty Ltd 16 20 AMP Signature Super 14 2 Universal Super Scheme 14 14 C+BUS 14 15 Generations Personal Super 13 14 Care Super 12 2 Others 138 148
TOTAL 1,445 1,504
22. SUBSEQUENT EVENTS
The Trust has no material or significant events occurring after the reporting date.
23. GLOSSARY OF TERMS
Cash and cash equivalents Cash and cash equivalents is petty cash, cash floats, deposits in bank accounts and short-term deposits (up to 6 months).
Comprehensive result Total comprehensive result is the change in equity for the period other than changes arising from transactions with owners. It is the aggregate of net result and other non-owner changes in equity.
Commitments Commitments include those operating, capital and other outsourcing commitments arising from non cancellable contractual or statutory sources.
Delaware North Australia Sinking Fund Refers to an account managed jointly by the Trust and the Trust’s caterer (Delaware North Australia) and is used for the replacement or improvement of catering equipment or infrastructure.
Employee benefits expense Employee benefits expenses include all costs related to employment including wages and salaries, leave entitlements, redundancy payments, defined benefits superannuation plans, and defined contribution superannuation plans.
36 Melbourne & Olympic Parks Trust notes to financial Statements for the financial year ended 30 June 2012
Financial asset A financial asset is any asset that is: (a) cash;
(b) an equity instrument of another entity;
(c) a contractual or statutory right:
• to receive cash or another financial asset from another entity; or • to exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable to the entity; or
(d) a contract that will or may be settled in the entity’s own equity instruments and is: • a non derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments; or • a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.
Financial instrument A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets or liabilities that are not contractual (such as statutory receivables or payables that arise as a result of statutory requirements imposed by governments) are not financial instruments.
Financial liability A financial liability is any liability that is: (a) A contractual or statutory obligation: (i) To deliver cash or another financial asset to another entity; or (ii) To exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the entity; or (b) A contract that will or may be settled in the entity’s own equity instruments and is: (i) A non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments; or (ii) A derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose the entity’s own equity instruments do not include instruments that are themselves contracts for the future receipt or delivery of the entity’s own equity instruments.
Financial statements Depending on the context of the sentence where the term ‘financial statements’ is used, it may include only the main financial statements (i.e. comprehensive operating statement, balance sheet, cash flow statements, and statement of changes in equity); or it may also be used to replace the old term ‘financial report’ under the revised AASB 101 (September 2007), which means it may include the main financial statements and the notes.
Grants Grants can be paid as general purpose grants which refer to grants that are not subject to conditions regarding their use. Alternatively, they may be paid as specific purpose grants which are paid for a particular purpose and/or have conditions attached regarding their use.
Annual Report 2012 37 notes to financial Statements for the financial year ended 30 June 2012
Intangible assets Intangible assets represent identifiable non‑monetary assets without physical substance.
Interest expense Costs incurred in connection with the borrowing of funds interest expenses include interest on bank overdrafts and short term and long term borrowings, amortisation of discounts or premiums relating to borrowings, interest component of finance leases repayments, and the increase in financial liabilities and non employee provisions due to the unwinding of discounts to reflect the passage of time.
Interest income Interest income includes interest received on bank term deposits, interest from investments and other interest received.
Net acquisition of non-financial assets (from transactions) Purchases (and other acquisitions) of non financial assets less sales (or disposals) of non financial assets less depreciation plus changes in inventories and other movements in non financial assets. It includes only those increases or decreases in non financial assets resulting from transactions and therefore excludes write offs, impairment write downs and revaluations.
Net result Net result is a measure of financial performance of the operations for the period. It is the net result of items of income, gains and expenses (including losses) recognised for the period, excluding those that are classified as other non owner changes in equity.
Net result from transactions (net operating balance) Net result from transactions or net operating balance is a key fiscal aggregate and is income from transactions minus expenses from transactions. It is a summary measure of the ongoing sustainability of operations. It excludes gains and losses resulting from changes in price levels and other changes in the volume of assets. It is the component of the change in net worth that is due to transactions.
Non-financial assets Non‑financial assets are all assets that are not ‘financial assets’.
Other economic flows Other economic flows are changes in the volume or value of an asset or liability that do not result from transactions. It includes gains and losses from disposals, revaluations and impairments of non current physical and intangible assets; actuarial gains and losses arising from defined benefit superannuation plans; fair value changes of financial instruments and agricultural assets; and depletion of natural assets (non produced) from their use or removal. In simple terms, other economic flows are changes arising from market re measurements.
Payables Includes short and long term trade debt and accounts payable, grants, taxes and interest payable.
Receivables Includes amounts owing from government through appropriation receivable, short and long term trade credit and accounts receivable, accrued investment income, grants, taxes and interest receivable.
Sales of goods and services Refers to revenue from direct provision of goods and services and includes fees and charges for services rendered and sales of goods and services.
Tennis Australia Special Purpose Account Refers to a separate trust account established by MOPT for tennis-related capital improvements to Melbourne Park.
Transactions Transactions are those economic flows that interact between two entities by mutual agreement.
38 Melbourne & Olympic Parks Trust CertificationJ
In accordance with a resolution of the members of the Melbourne and Olympic Parks Trust and in our opinion: (a) the accompanying financial report of the Trust, comprising operating statement, balance sheet, cash flow statement and statement of changes in equity read in conjunction with the notes thereto present fairly the financial operations of the Trust for the year ended 30 June 2012 and the State of Affairs of the Trust on that date; (b) these accounts have been prepared in accordance with the Financial Management Act 1994, Australian Accounting Standards and other mandatory professional reporting requirements; and (c) at the date of this statement we are not aware of any circumstances which would render any particulars included in the statement to be misleading or inaccurate.
Russell Caplan Member of Responsible Body Chairman Melbourne and Olympic Parks Trust
Brian Morris Accountable Officer Chief Executive Officer Melbourne and Olympic Parks Trust
Travis Mardling Chief Financial Officer Melbourne and Olympic Parks Trust
Melbourne 23 August 2012
Annual Report 2012 39 Independent Audit Report
40 Melbourne & Olympic Parks Trust Independent Audit Report
Annual Report 2012 41 Administrative reporting requirements
Competitive Neutrality Policy compliance The Trust has established written procedures for handling disclosures made under the Whistleblowers Protection The Trust regularly reviews whether its activities are subject Act 2001 in accordance with the guidelines issued by the to the requirements of the National Competition Policy, Ombudsman Victoria. A full copy of the procedure is available including compliance with the requirements of the policy in Melbourne & Olympic Parks web site statement ‘Competitive Neutrality Policy Victoria’, and http://www.mopt.com.au. takes necessary action to implement competitive neutrality Contact: General Manager People and Culture measures where required. The procedures include detailed information about; Statement of compliance with • roles and responsibilities of the Disclosure Officer and the Disclosure Coordinator; the Building Act 1993. • confidentiality provisions; The Trust complies with the relevant guidelines, pursuant to • procedures for the conduct of investigations; Section 220 of the Building Act 1993. • action to be taken after an investigation; Implementation of the Victorian Industry • managing the welfare of the whistleblower; Participation Policy • management of the person against whom a disclosure has been made. In October 2003, the Victorian Parliament passed the Victorian a) The current procedures established by Melbourne and Industry Participation Policy Act 2003 which required public Olympic Parks Trust under Part 6 of the Act can be found bodies and departments to report on the implementation of on www.mopt.com.au; the Victorian Industry Participation Policy (VIPP). The Trust is required to apply the VIPP where Trust funding exceeds $3 b) The Trust has received no disclosures during the year. million in metropolitan Melbourne and $1 million in regional c) The Trust has not referred any disclosures to the Victoria. The Trust commenced one project during 2011/12 to Ombudsman for determination as to whether they are which the VIPP applies, totalling $6.3million in metropolitan public interest disclosures during the year; Melbourne. The outcomes expected from the implementation d) The Ombudsman has not referred any disclosed matters of VIPP to this project are: to the Trust during the year; • Local content of 40%; e) The Trust has not referred any disclosed matters to the • 15 full time equivalent jobs, including the creation of 2 Ombudsman to investigate during the year; new jobs and the retention of 13 existing jobs; f) The Ombudsman has not taken over any investigation of • 1 existing apprentice/trainee utilised; and disclosed matters from the Trust during the year; • Expected benefits include developing and maintaining a g) The Trust has made no request under section 74 of the skilled workforce for the construction industry as well Act to the Ombudsman to investigate disclosed matters as the potential to investigate innovations, research and during the year; development of technology by alternative pavement h) The Trust has not declined to investigate a disclosed design means. matter during the year; i) There have been no disclosed matters that were Financial and other information retained by substantiated on investigation. There has been no action required to be undertaken arising from an investigation, the accountable officer since there have been no investigations; and Relevant information detailed in Financial Reporting Direction j) The Ombudsman has not made any recommendations (FRD) 22B ‘Standard Disclosures in the Report of Operations’ under the Act that relates to the Trust. under the Financial Management Act 1994 Section 3 is retained by the Trust’s Accountable Officer and is available on request, subject to the Freedom of Information Act 1982. Disability Act (2006) MOPT is committed to providing equitable, dignified access to Whistleblowers Protection Act 2001 goods and services and to premises used by the public. A number of initiatives have been undertaken over the past three years to This section of the report contains information that is required ensure compliance with the Act and work is currently underway to to be published annually under the Whistleblowers Protection develop a new three year plan which takes into account the many Act 2001 Section 104. changes occurring around the precinct.
42 Melbourne & Olympic Parks Trust Administrative reporting requirements
Occupational Health and Safety (OH&S) Statement of Workforce Data In December 2011, MOPT received certification of its Melbourne and Olympic Park Trust is committed Safety Management System to AS4801 Level. This to two codes issued by the Public Sector Standards certification is indicative of an organisation that has work Commissioner (PSSC), being the Director Codes of practices and procedures that are equal to or exceed Conduct and Guidance Notes and the Code of Conduct of the national certification standard. MOPT is committed Victorian Public Sector employees. to a continuous improvement approach to its Safety Enterprise Based Agreements are in place and the Trust Management System. continues its ongoing commitment to the PSSC standards The importance of toolbox meetings continues to be on equal opportunity, fair and reasonable treatment, merit reinforced with 127 meetings held across the precinct in employment and reasonable avenues of redress. during the financial year. In addition, 285 workplace Melbourne & Olympic Parks Trust employed 107 full time inspections were carried out which ensures a proactive and part time staff as at 30 June 2012 (2011:106). The approach to safety is adopted. Worksafe Week continues number of Full Time Equivalent (FTE) staff at 30 June 2012 to be a highlight, raising the profile of safety across the was 103 (2011: 101). The number of fixed term and casual organisation and the new Employee Wellbeing Program employees at 30 June 2012 was 1,091 (2010:1,106) and a has been well utilised throughout the year. Committee large number of contractors provided by our key partners meeting attendances have been excellent and the nature also contribute to MOPT’s workforce (ACG, Capricorn of discussions improved significantly. Stages and Rigging, Delaware North Companies, Michael A full copy of the Trust’s OHS policy is available on MOPT’s O’Brien Catering and Ticketek). website: http://www.mopt.com.au. The breakdown of staff is as follows;
MOPT Workforce Data
Employees Full Part FTE Fixed Term (Headcount) time time & Casual (Headcount) (Headcount) Employees
June 2012 107 88 19 103 1,091 June 2011 106 88 18 101 1,106
June 2012 June 2011
Employee FTE Fixed Term Employees FTE Fixed Term (Headcount) & Casual (Headcount) & Casual Employees Employees
Accountable officer 1 1 - 1 1 - Executive officers (remuneration greater than $100k) 15 15 - 14 14 - Administration staff (remuneration less than $100k) 91 87 1,091 91 86 1,106 Males 58 57 549 58 57 547 Females 49 46 542 48 44 559
Freedom of information The Freedom of Information Act 1982 allows the public a right of access to documents held by Melbourne and Olympic Parks Trust. During the 12 months to June 2012, the Trust received 1 Freedom of Information request. The processing of this request was in progress as at 30 June 2012. The Chief Financial Officer is the contact officer in relation to all Freedom of Information requests. Access to documents may be obtained through written request to the Chief Financial Officer, addressed as follows: Freedom of Information Melbourne and Olympic Parks Trust GPO Box 4611, Melbourne VIC 3001 Requests can also be lodged via email to [email protected]. Access charges may also apply once documents have been processed and a decision on access is made; for example photocopying and search and retrieval charges.
Annual Report 2012 43 Administrative reporting requirements
Consultants
Details of consultancies over $10,000 Consultant Purpose of consultancy Start date End date Total expendi- Future ture 2011/12 commitments (excluding GST) The Maytrix Expert advice in relation to the catering Sept 2011 Feb 2012 $20,772 Nil Group tender for the Bench cafe 1st Executive Function Centre and Superbox sales Nov 2011 Feb 2012 $19,172 Nil process advice David Payne Expert advice in relation to the catering Jan 2012 Mar 2013 $40,909 $25,000 & Associates tender for Melbourne Park David Payne One-off review with recommendations Dec 2011 May 2012 $13,636 Nil & Associates for the structure of the cleaning department Details of consultancies less than $10,000
Number: 4 Total Amount: $6,384 (excluding GST)
Gosch’s Paddock We are pleased to report that Gosch’s Paddock was not closed to the public at all throughout the year.
Risk Attestation Statement I, Chair of the Trust, certify that Melbourne & Olympic Parks Trust has risk management processes in place consistent with the Australian/New Zealand Risk Management Standard (AS/NZS ISO 31000:2009) and an internal control system is in place that enables the executive to understand, manage and satisfactorily control risk exposures. The Trust verifies this assurance and that the risk profile of Melbourne & Olympic Parks Trust has been critically reviewed within the last 12 months.
Russell Caplan Chairman Melbourne and Olympic Parks Trust
44 Melbourne & Olympic Parks Trust Disclosure Index
The Annual Report of Melbourne & Olympic Parks Trust is prepared in accordance with all Victorian Legislation. This index has been prepared to facilitate identification of compliance with statutory disclosure requirements.
Ministerial Directions
Charter and Purpose FRD 22C Manner of establishment and the relevant Minister 4 FRD 22C Objectives, functions, powers and duties 4 FRD 22C Nature and range of services provided 4
Management and structure FRD 22C Organisational Structure 5
Financial and other information FRD 10 Disclosure index 45 FRD 15B Executive officer disclosures 35 FRD 22C Application and operation of Freedom of Information Act 1982 43 FRD 22C Application and operation of the Whistleblowers Protection Act 2001 42 FRD 22C Compliance with building and maintenance provision of Building Act 1993 42 FRD 22C Details of consultancies over $10,000 44 FRD 22C Details of consultancies under $10,000 44 FRD 22C Major changes or factors affecting performance 12 FRD 22C Occupational Health and Safety 43 SD 4.5.5 Risk Attestation Statement 44 FRD 22C Statement of availability of other information 42 FRD 22C Statement on Competitive Neutrality Policy 42 FRD 22C Summary of financial results for the year 12 FRD 22C Summary of major activities 9-10 FRD 22C Subsequent events N/A FRD 25A Victorian Industry Participation Policy disclosures 42 FRD 29 Statement on Workforce Data 43
Financial Statements required under Part 7 of the FMA SD 4.2 (a) Financial Statements 13-41 SD 4.2 (b) Balance Sheet 15 SD 4.2 (b) Cash flow Statement 17 SD 4.2 (b) Comprehensive Operating Statement 14 SD 4.2 (b) Statement of Changes in Equity 16 SD 4.2 (c) Accountable officer’s declaration 39 SD 4.2 (c) Compliance with Australian accounting standards and other authoritative 18 pronouncement SD 4.2 (c) Compliance with Ministerial Directions 39 SD 4.2 (d) Rounding of amounts 21
Other disclosures in notes to the financial statements FRD 9A Departmental disclosure of administered assets and liabilities N/A FRD 11 Disclosure of ex-gratia payments N/A FRD 13 Disclosure of parliamentary appropriations N/A FRD 21B Responsible person and executive officer disclosures 34,35
Legislation Freedom of Information Act 1982 Audit Act 1994 Building Act 1993 Whistleblowers Protection Act 2001 Financial Management Act 1994 Victorian Industry Participation Policy Act 2003 Crown Land (Reserves) Act 1978 Disability Act 2006 Melbourne and Olympic Parks Act 1985
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© State of Victoria, Melbourne & Olympic Parks Trust 2012. This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968. MELBOURNE & OLYMPIC PARKS TRUST ANNUAL REPORT 2012