Mt Baw Baw 2014 Alpine Resort ANNUAL REPORT Management Board Mt. Baw Baw Alpine Resort PO Box 117, Rawson, VIC, 3825 P 03 5165 1136 F 03 5165 1125 E [email protected] W www.mountbawbaw.com.au

ABN 30 402 472 781

© State of Victoria, Mount Baw Baw Alpine Resort Management Board 2015. This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968.

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ADDRESSADDRESS [XX] February 2015 TO THE TO MINISTER THE MINISTER

The Honourabl e Lisa Neville MP Minister fo r Environmen t, Climat e Change and Water Level 7 , 8 Nich olson St 27 April 2015 EAST MELBOURN E VI C 3002

The Honourable Lisa Neville MP MinisterDear Ministe for Environment,r Neville Climate Change and Water

Level 7, 8 Nicholson St EAST MELBOURNE VIC 3002 MT B AW B AW ALPIN E RESO RT MANAGEMEN T BOAR D – ANNUA L REPO RT

We have much pleasure in submitting to you for presentation to Parliament, the Annual Report of the Mt Dear Minister Neville Baw Baw Alpine Resort Management Board , covering the period 1 November 201 3 to 31 October 201 4. MT BAW BAW ALPINE RESORT MANAGEMENT BOARD – ANNUAL REPORT The Annual Report has been prepared in accordance with the Financial Management Act 1994 and the Alpine Resorts (Management) Act 1997. We have much pleasure in submitting to you for presentation to Parliament, the Annual ReportOn behalf of the of Mt the Baw Board, Baw we Alpine extend Resort our appreciation Management for your Board, sup port covering and also the the period support 1 November and cooperation of 2013the to Department 31 October of 2014. Environment and Primary Industries throughout the yea r.

YoursYours sincerely, sincerel y,

Vicky Papachristos Craig Jensz ChairVicky Papachristos AccountableCraig Jensz Officer Chair Accountable Officer

2 | Page DRAFT

PAGE | 1 TABLE OF CONTENTS

About Mt Baw Baw ��������������������������������������������������������������������������������������������������������������������������4 Our Guiding Principles �������������������������������������������������������������������������������������������������������������������5 Chair’s Report ���������������������������������������������������������������������������������������������������������������������������������6 Resort Manager’s Report ��������������������������������������������������������������������������������������������������������������7 2014 Operational Report ����������������������������������������������������������������������������������������������������������������8 Structural changes to the Entity during 2013-14 ����������������������������������������������������������������� 8 Enhancing the visitor experience and growing the Resort ���������������������������������������������������8 White season visitations ������������������������������������������������������������������������������������������������������ 9 Ski Patrol operations ����������������������������������������������������������������������������������������������������������10 Arts and Culture Program �������������������������������������������������������������������������������������������������� 11 Green season events ���������������������������������������������������������������������������������������������������������� 11 Current year financial review ����������������������������������������������������������������������������������������������12 Significant changes or factors affecting performance �������������������������������������������������������13 Capital projects �������������������������������������������������������������������������������������������������������������������13 Disclosure of grants and transfer payments ����������������������������������������������������������������������13 Disclosure of government advertising expenditure �����������������������������������������������������������13 Subsequent events �������������������������������������������������������������������������������������������������������������13 Five year financial summary ����������������������������������������������������������������������������������������������14 Operational and Budgetary Objectives and Performance Against Objectives ����������������������� 15 Objectives and priorities of the Corporate Plan �����������������������������������������������������������������15 Report against the Corporate Plan KPI’s ���������������������������������������������������������������������������19 Governance & Organisational Structure ��������������������������������������������������������������������������������� 21 Organisational structure ����������������������������������������������������������������������������������������������������21 Objectives, functions, powers & duties ����������������������������������������������������������������������������� 22 Governing Board ���������������������������������������������������������������������������������������������������������������� 23 Board Member profiles ������������������������������������������������������������������������������������������������������ 24 Nature and range of services provided ����������������������������������������������������������������������������� 27 Key stakeholders ��������������������������������������������������������������������������������������������������������������� 27 Incident management �������������������������������������������������������������������������������������������������������� 28 Department’s performance against OH&S management measures �������������������������������� 28 Employment and conduct principle ����������������������������������������������������������������������������������� 28 Workforce data ������������������������������������������������������������������������������������������������������������������� 28 Executive Officer data �������������������������������������������������������������������������������������������������������� 30

PAGE | 2 Other Disclosures ��������������������������������������������������������������������������������������������������������������� 31 Implementation of the Victorian Industry Participation Policy (VIPP) ��������������������������������31 Consultancy expenditure ����������������������������������������������������������������������������������������������������31 Disclosure of major contracts ������������������������������������������������������������������������������������������� 32 Freedom of Information ����������������������������������������������������������������������������������������������������� 32 Compliance with Building Act 1993 ������������������������������������������������������������������������������������ 33 National Competition Policy ���������������������������������������������������������������������������������������������� 33 Compliance with the Protected Disclosure Act 2012 ��������������������������������������������������������� 33 What is a ‘protected disclosure’? �������������������������������������������������������������������������������������� 33 What is ‘improper or corrupt conduct’? ���������������������������������������������������������������������������� 34 Compliance with DataVic access policy ����������������������������������������������������������������������������� 34 Summary of environmental performance ������������������������������������������������������������������������� 35 Risk Management Attestation ������������������������������������������������������������������������������������������������� 36 Insurance Attestation ��������������������������������������������������������������������������������������������������������������� 36 Gifts, Benefits and Hospitality Attestation ������������������������������������������������������������������������������ 36 Auditor-General’s report ��������������������������������������������������������������������������������������������������������� 37 Financial Statements ��������������������������������������������������������������������������������������������������������������� 39 Declaration ������������������������������������������������������������������������������������������������������������������������ 39 Comprehensive operating statement �������������������������������������������������������������������������������� 40 Balance Sheet ���������������������������������������������������������������������������������������������������������������������41 Statement of changes in equity ����������������������������������������������������������������������������������������� 42 Cash Flow Statement ��������������������������������������������������������������������������������������������������������� 43 Notes to the financial statements ������������������������������������������������������������������������������������� 44 Disclosure Index ���������������������������������������������������������������������������������������������������������������� 87

PAGE | 3 INTRODUCTION

About Mt Baw Baw l Snow making facilities l Terrain: beginners 25%, intermediate 64%, advanced 11% l Unique picturesque sub-alpine environment with spring flowers over the summer months and views to Port Phillip Bay and Westernport Bay Melbourne Mt Baw Baw l A variety of events during the green season catering to a wide range of visitors Traralgon l National standard downhill mountain bike trail Mt Baw Baw is an all season alpine resort, l Restaurant for dining, conferences, open for summer and winter adventure. special occasions and weddings The Resort caters for snowboarders, skiers and snow enthusiasts during winter and outdoor adventurers, hikers and bike riders during the summer months. QUICK FACTS l Victoria’s affordable, family friendly ‘learn to ski’ destination l Melbourne’s closest downhill ski Resort l Only two and a half hours drive (177km) from Melbourne l Three hour drive from the Mornington Peninsula l One hour from the heart of Gippsland l Variety of overnight accommodation offerings l 12-15 week white season, 37-40 week green season l 47,200 average white season visitor days l Over 35 hectares of groomed runs l Seven ski lifts, 15 runs l 10km of groomed cross country ski trails l Two snow play areas plus a terrain park

PAGE | 4 Our Guiding Principles Manner of establishment & responsible Minister The guiding direction and principles adopted The Board is established under the Alpine by the Mt Baw Baw Alpine Resort Board (the Resorts (Management) Act 1997. “Board”) and management are summarised in the following Mission and Vision The responsible Minister for the period statements: from 1 November 2013 to 31 October 2014 was the Hon Ryan Smith MP, Minister for Mission Environment and Climate Change. To provide a vibrant alpine Resort service within a sustainable environmental, economic and social framework in Victoria. Vision The Mt Baw Baw Alpine Resort (“Mt Baw Baw or the Resort”) will offer a family friendly, environmentally sensitive, alpine experience. Values The Board and management will: l Be accessible, available and will listen to all parties; l Be honest, fair and transparent in its dealings; l Give due consideration to the interests of all stakeholders; l Value all Resort stakeholders and partners; l Provide decisive leadership and governance; l Ensure the effective and efficient delivery of quality; and l Ensure that social, environmental and ethical responsibilities are met.

PAGE | 5 CHAIR’S REPORT

2013-2014 was a year of positive and I would like to thank the previous substantial change for the Mt Baw Baw management team, led by Stuart Ord as CEO, Alpine Resort. In late 2013, the Board who made significant progress in improving commenced a public tender process seeking the Resort and readying it for the public a commercial manager and operator at tender process. In particular in 2013-2014, the Resort. The goal of this initiative was significant momentum in the development to improve the viability and the long-term of green season activities was achieved; financial sustainability of the Resort. including the Kids Adventure Festival, the state mountain bike championships, the Baw Following a competitive process, the Board Baw sprint car rally and the Baw Baw Classic announced the appointment of Belgravia cycle race. Leisure (“Belgravia”) as the successful new operator of Mt Baw Baw. Belgravia has I also take this opportunity to thank the two a proven track record in the leisure and departing Board members, Wally Tabensky tourism industry, managing over seventy and Jacqui Mcleod. Both Board members facilities throughout Australia. Belgravia have made a valuable contribution to the Leisure also successfully manages Resort, with Wally being involved with Mt the Lake Mountain Alpine Resort near Baw Baw for over 20 years. Two new Board Marysville, Victoria. members, Grace La Vella and David Bates, joined the Board in November 2014 and we Belgravia commenced at the Resort in May look forward to working with them. 2014. Since then, it has executed a number of positive improvements to the visitor Looking ahead, the Board is working with experience at Mt Baw Baw and generated Belgravia to progress a number of initiatives operating efficiencies. Initiatives included during 2015. This includes additional the establishment of the guest information improvements to the white season program centre, a revitalised food and beverage and various green season events. offering and improvements to the snow offering. There is still a long way to go as Mt Baw Baw requires significant ongoing assistance from the Pleasingly, snow falls in the 2014 white season Victorian Government. With the new operating were above average. Mt Baw Baw recorded structure now well established, we plan to 93,000 visitor days, up 54% from 2013. further improve the Resort with the objective of long-term sustainable financial viability. The results of the new initiatives and positive climatic conditions at Mt Baw Baw resulted in better performance in 2014. Operating revenue increased by 63% to $4.0 million and allowed a reduction in government contributions by 16% down to $3.8 million. Vicky Papachristos Chair, Mt Baw Baw Alpine Resort Management Board 27 April 2015

PAGE | 6 RESORT MANAGER’S REPORT

2013-2014 has been a year that has seen The management team continued its some great progress at the Resort. The careful and conscientious management of appointment of Belgravia from 1 May 2014 the alpine environment. This included the resulted in a significant change to Resort continued development of the Environment operations just prior to commencement of Management Plan. A special area of focus is the white season, with many functions moved around protecting the rare and endangered to Belgravia’s Head Office central support species living within the Resort, including the services. Baw Baw Frog, the Blue-toothed Rat and the Leadbeaters Possum. Management has focused on improving the guest experience at the Resort. The major The Resort continued to focus on risk initiative involved installing a guest services management throughout the year. This hub at the entrance to the Resort. The hub included a live practical evacuation exercise gave an improved warm and informed first in accordance with the Resort’s Emergency impression for visitors and maximised the Management Plan just prior to the start of the opportunity for the use of over snow vehicles white season. to transport visitors around the Resort with ease.

An increased focus on marketing contributed to the success of the white season. A highlight of the year was the promotional video featuring Lochie Daddo, the Alpine Alex Flint Resorts Coordinating Council ambassador. Resort Manager, Mt Baw Baw Alpine Resort The promotional footage was seen on Management Board mainstream TV and used extensively across 27 April 2015 social media with great success.

The green season’s events should be noted as a very positive step towards the development of the alpine experience at Mt Baw Baw outside of the white season. The 12 events and weddings recorded an impressive 2,340 visitors including the introduction of the very successful kids adventure weekend. The success of the events was directly linked to the range of activities on offer. This diverse approach resulted in visitations from an expansive cross section of the community. The success of the events in 2013/14 is a clear contributor to improving the sustainability of the Resort.

PAGE | 7 YEAR IN REVIEW

2014 Operational Report Belgravia has been appointed to manage the Resort on a fee for service basis with the Structural changes to the Entity incentive to improve financial performance. during 2013-14 The contract is for one-year with the option to In 2013 and early 2014, the Board extend this arrangement. conducted a public tender process seeking Belgravia reports to the Board and is subject a commercial operator for the Resort. to the same legislation and regulations The decision to run a tender process was already in place. in response to recommendations by the Alpine Resorts Co-ordinating Council in Enhancing the visitor experience and their Financial Sustainability of the Lake growing the Resort Mountain and Baw Baw Alpine Resorts, November 2011 report and the Victorian The first point of contact with visitors was Auditor-General’s Tertiary Education and dramatically improved with the installation of Other Entities: Results of 2011 Audits report, a guest services hub at the Resort entry. The May 2012 that the Board investigate revised hub gave visitors a central and accessible operating arrangements to improve the information source and ensured they received longer-term financial viability of the Resort. information in an efficient and professional manner. Further, under the Alpine Resorts Strategic Plan 2012, key strategic objectives include The Resort’s number plate recognition Alpine the efficient delivery of Resort services and Easy Access system built on its success in infrastructure, building partnerships and 2013. The platform helped eliminate queuing regulatory reform. To maximise prospects at the old gateway. of successful outcomes, recommendations include commercial roles being given to the private sector, with the role of the Board focusing on land management functions.

In line with these report recommendations and the Alpine Resorts Strategic Plan 2012, the Board appointed Belgravia as the commercial operator of the Resort from 1 May 2014, following a competitive tender process.

Belgravia has a proven track record in the leisure industry, managing over seventy facilities throughout Australia, including successfully managing Lake Mountain.

PAGE | 8 2009 2010 2011 2012 2013 2014 Visitor days 53,000 67,068 52,438 74,790 60,872 93,441 Skier days 15,691 24,922 14,244 21,820 9,359 19,254 White season visitation27% -22% 43% -19% 54% 59% -43% 53% -57% 106%

IncidentsThe graph below highlights147 the record209 visitation112 280achieved during the 2014 white season. Incidents per 1000Resort visitor days visitor days are up 2.80 70% on 2.79 the 10 1.84 year average 3.00 and 54% up on 2013. Skier days 1000increased skier days 106% in 2014. 10.32 9.58 11.97 14.54

Chart 1: Mt Baw Baw visitor days and skier days Mt Baw Baw visitor days and skier days

93,441 Good snow falls just prior to the July school holidays 74,000 67,000 provided a solid base of 60,872 53,000 52,000 snow. Excellent snow making conditions in late July enabled the Resort to 24,922 21,820 19,254 15,691 14,244 maintain good snow levels 9,359 until late August, as shown in 2009 2010 2011 2012 2013 2014 the chart below. Visitor days Skier days

Chart 2: 2014 snowmaking and natural snow depths

Outside of the school holiday period, visitation was predominately during Friday-Sunday, with good snow conditions driving improved visitation as shown in the chart below.

PAGE | 9 Chart 3: 2014 snow depth and visitor days

Ski Patrol Operations The patrol could not operate to its expected high standards without the small but Overall, the number of incidents the committed team of volunteer patrollers who patrol was required to attend this year in have again been a valuable asset during the comparison to previous years is higher season. The volunteer patrollers continue to and can be attributed to record visitation, provide an exceptional level of service in what demographic of visitors and the number of are the busiest periods for the Resort and for days the Resort was fully operational. this we are very grateful. Chart 4: Reported safety incidents Co-operation between all operational Resort 2014 2013 2012 2011 staff over the course of this season has been exceptional and assistance to the Ski Incidents 280 112 209 147 Patrol from these staff during peak periods Skier days 93,441 60,872 74,790 52,438 and time critical incidents was freely given. Of particular importance is the assistance Incidents of those staff who recently completed the per 1,000 14.54 11.97 9.58 10.32 skier days Australian Ski Patrol Association (ASPA) Advanced Emergency Care Course. Their Air 2 0 2 3 evacuations assistance provided an opportunity to put into

Road practice theory learned during the course evacuations 23 9 13 12 and it is hoped this process can be further developed in future years.

PAGE | 10 The provision of an all-wheel drive ambulance Arts and Culture Program and two Ambulance Community Officers The ongoing arts and culture program (ACO’s), stationed within the Resort each continued to grow. The location of the Resort weekend during the declared snow season offers a large amount of potential in this area. was continued for the 2014 snow season. The Resort again hosted the ArchiBawBaw The provision of ACO coverage throughout Portrait prize. The ArchiBawBaw project the season has reduced patrol wait times continues to grow the Resort’s collection for weekend ambulance transportation of the pioneers and characters from the and assistance, allowing patrollers to focus establishments of the Mt BawBaw Alpine upon their primary role of ski area risk Resort. The Resort has continued to support management and guest education. local arts and culture programs, by offering a In addition to the above there were six career major prize for the Tyers arts festival. Other paramedics who volunteered their time future projects include photography tours throughout the season to provide midweek and painting retreats. coverage to the Resort. The sourcing of Green season events volunteer doctors throughout the season greatly assisted the Ski Patrol in providing In accordance with the Alpine Resorts extended care and patient management to Strategic Plan 2012, a focus has been on casualties. This season we were fortunate developing and growing green season events to have the services of six extremely skilled that are economically viable into the future. doctors with excellent coverage across the The Resort’s green season capital works plan majority of weekends during the season. included investment into mountain bike trail All of the doctors engaged have expressed building and construction of new sections of an interest in returning to Mt Baw Baw in single track. 2015 and we look forward to their continued The green season Adventure Hub has support of the Resort. continued to prove popular with guests, The Ski Patrol training program was reviewed offering the following facilities: for the 2014 season to accommodate a l Bike hire growing number of summer events within l Event entry and registration the Resort. The requirement for a first aid presence within the Resort at these events l Sales of shuttle pass allowed greater emphasis to be placed upon l Trail guides and mapping hands on learning and equipment training in l The sale of refreshments and basic a live environment. spares.

This central service facility offers a range of supporting information around the recreation facilities and events at the Resort. The Adventure Hub presents opportunities for guests and staff to interact and develop the customer centric approach at the Resort.

PAGE | 11 Below is a summary of the green season events in 2013/2014:

Chart 5: Green season event summary

EVENT DESCRIPTION PARTICIPANTS

2013/14 2012/13

Fly Fish Baw Baw Festival of Fly Fishing 52 55

SoP Spring Trail running/mountain biking event 60 60

Downhill MTB Pin it to Win It 130 120

Mountain Bike Festival State MTB Champs 310 270

Mountain Bike Festival Mt Baw Baw Enduro 85 65

SoP Summer Trail running/mountain biking event 58 50

Baw Baw Sprint Car rally 45 cars 120 90

Conference GCLP 30 25

Weekend of trail running activities & Trail Run Festival & Orienteering 340 250 Orienteering championship

Melbourne University Ski Jump Weekend 60 60

Kids Adventure Festival Festival of outdoor activities for kids 400 0

Baw Baw Classic Cycle race Warragul to Mt Baw Baw 270 255

4 Weddings Weddings held at Mt Baw Baw 425 0

Total Participation 2,340 1,300

Current year financial review l However, due to additional visitations the Resort saw an increase in operating In 2013-2014 operating revenues increased expenditure of 20% on 2012-2013 and 22% 63% on 2012-2013 and 27% from the average on the past 4 year average over the past 4 years. The net result prior to Government contributions improved by 8% l A decrease in employees by 11 FTE towards on 2012-2013, however was 14% below the the end of the financial year assisted in average over the past 4 years. These results reducing employment costs; and can be explained by the following: l A large contribution to the increase in l Excellent snow falls resulting in record white expenses was due to a number of one off season visitations at 93,441 visitor days; items, including public tender process costs, redundancy payments and an overlap l Snow falls prior to and within school of staff roles during the organisational holidays assisted the record visitation; restructure. l Full year revenues were also assisted by The Board’s cash position during 2013-2014 the increased number of green season was supported by the Government. events and attendances;

PAGE | 12 Significant changes or factors l Extended summer slope development for affecting performance improved drainage for ski runs; and l Fitted and powered the new weather Belgravia appointment station at Central Summit area. The Board engaged Belgravia on 1 May Disclosure of grants and transfer 2014. As a result of this, the Board incurred payments additional costs to conduct the public tender process and incurred transitional costs, Mt Baw Baw was the recipient of a State including some staff redundancy costs and Government grant of $108,840 from the overlap of staff roles for a brief period. These Alpine Risk Mitigation Program during the are one off expenditures that are not expected reporting period. This grant will be used to to be incurred in FY15 on the basis that undertake the Tingaringy Drive/Candle Heath Belgravia’s management contract extension Road risk mitigation program project. options are exercised. Underlying results There were no transfer payments issued in suggest improvements have been made to the 2013/14. more efficient operation of the Resort. Disclosure of government advertising Significant changes in financial position expenditure during the year Government policy requires disclosure of There have been no significant changes in all Government Advertising Expenditure financial position during the year. with a total media buy of $150,000 or greater (exclusive of GST). No Government Capital projects Advertising Expenditure was incurred during the reporting period. During 2013/14 the Board undertook a number of minor capital works projects as Subsequent events outlined below: The Victorian State election was held 29 l Candle Heath Drive extension; November 2014. Consequently new Minister for Environment, Climate Change and Water, l Night Skiing development to Tower 4 on the Honourable Lisa Mary Neville MP, was Hutt Run; appointed by the Governor of the State of Victoria on 4 December 2014. l Completion of the Big Hill (Poma) runs earth works and re-development to meet The Governor in Council also made an order the planning permit requirements; on the same date, under section 10 of the Public Administration Act 2004, to change l Car Park 5 repairs and development; the name of the portfolio department that l Road signage from No.1 chain bay to the Mt Baw Baw Alpine Resort Management day car park for Alpine Easy Access; Board fall under, from the Department of Environment and Primary Industries to the l Fitted and erected new communications Department of Environment, Land, Water tower on Tank Hill; and Planning (DELWP).

PAGE | 13 $850,000 of operational funding that related to the 2014 financial year was subsequently received from DELWP after the balance date, resulting in the higher than normal creditors balances at 31 October 2014. Financial obligations in excess of 30 days were paid once funding was received in November 2014. Five year financial summary

Chart 6: Five year financial summary

2013/14 2012/13 2011/12 2010/11 2009/10 $ $ $ $ $

Operating revenue $3,963,404 $2,436,057 $3,680,655 $2,741,911 $3,577,503

Government $3,822,099 $4,539,215 $1,423,857 $5,391,500 $2,874,000 contributions

Non-operational $5,400 $5,050 $22,222 $28,991 $16,078 revenue

Total revenue $7,790,903 $6,980,322 $5,126,734 $8,162,402 $6,467,581

Operating $7,491,245 $6,241,160 $6,352,705 $6,242,713 $5,803,318 expenses

Depreciation $1,050,868 $1,086,922 $1,118,317 $798,260 $785,170

Total expenditure $8,542,113 $7,328,082 $7,471,022 $7,040,973 $6,588,488

Net result from -$751,210 -$347,760 -$2,344,288 $1,121,429 -$120,907 transactions

Net gain(loss) on non-financial -$1,793 -$54,886 -$7,481 $532 $3,010 assets, changes in asset valuation

Net result -$753,003 -$402,646 -$2,351,769 $1,121,961 -$117,897

Net result excl. Government -$4,575,102 -$4,941,861 -$3,775,626 -$4,269,539 -$2,991,897 contributions

Current assets $1,291,514 $942,313 $519,329 $1,950,590 $291,523

Non-current $17,551,769 $17,951,537 $18,608,348 $19,573,796 $14,377,790 assets

Total assets $18,843,283 $18,893,850 $19,127,677 $21,524,386 $14,669,313

Current liabilities $1,397,132 $983,976 $806,569 $728,778 $592,939

Non-current $244,480 $340,860 $464,448 $587,179 $339,157 liabilities

Total liabilities $1,641,612 $1,324,836 $1,271,017 $1,315,957 $932,096

PAGE | 14 Operational and Budgetary Objectives and Performance Against Objectives Objectives and priorities of the Corporate Plan The table below summarises the Resort’s performance against the objectives and priorities contained in the Resort’s 2013-2014 Corporate Plan.

Chart 7: Performance against 2013-2014 strategic objectives and priorities

STRATEGIC OBJECTIVES KEY ELEMENT OUTCOME MEASURES OF PERFORMANCE

1 Enhancing the visitor Run public tender process Belgravia appointed and Belgravia appointed and experience and to ascertain private started on 1 May 2014 started on 1 May 2014 developing resorts operator interest in future management of and investment in the Resort

Develop minimum of 15 green 15 green season events $152k revenue generated and season nature based activity conducted 4,454 active participants in events which return positive the events (31% increase in revenue participants relative to FY13)

Increase use of focused social Growth of the Mt Baw 27% increase in number of media as a marketing tool Baw Facebook “likes” and Facebook likes over the white increased levels of views for season related posts on the page

Re-establish Big Hill Poma Big Hill Poma was re- Skier days increased ski lift to full capacity established and operated from 15% of total visitor throughout FY14 snow season days in 2013 to 21% in 2014. Satisfaction surveys highlighted the speed and efficiency score for the lifts had increased from 3.3 in FY13 to 3.6 out of 5

Establish and commission New toboggan run was Not implemented new toboggan run to cater for not developed but will be increasing snow play visitors considered in 2014-2015 and improve safety

Construct new guest services New Guest Services hub Customer service score was hub reception area in main installed in main car park. All consistent with the average car park guest services and lift tickets over the past 4 years at 3.6 could be purchased from this out of 5. Ski field revenue point increased by 160% when compared to FY13 with the percentage of skier days compared to total visitor days increasing from 15% in FY13 to 21% in FY14

Enhance night skiing Night skiing conducted every Overall net promoter score opportunities on Hut run Saturday night through white for skiing and boarding season experience higher at 3.9 out of 5 (up 0.3 on FY13)

PAGE | 15 STRATEGIC OBJECTIVES KEY ELEMENT OUTCOME MEASURES OF PERFORMANCE

1 Enhancing the visitor Construct new innovative Due to the Belgravia Not implemented experience and mountain biking terrain park transition this project was developing resorts cont’d put on hold pending further investigation in 2014/15

Supply guest lockers at Due to the Belgravia Not implemented visitors centre top car park transition this project was put on hold pending further investigation in 2014/15

Establish green season Due to the Belgravia Not implemented adventure obstacle course transition this project was with resort put on hold pending further investigation in 2014/15

Refine and enhance resort SMS Advisory system Despite being in operation in snow season SMS advisory operated as per FY13 white FY13, in FY14 white season system season weekend based injuries decreased

2 Delivering Resort Implement a financial Due to timing of transition Implemented an internal services and reporting application which financial reporting tracking system to monitor infrastructure efficiently integrates existing application application not implemented. results and accountably for efficient reporting and Implementation to occur in tracking purposes FY15

Develop online purchasing Online purchasing of Online packaging worked capability accommodation available well with the $100k target exceeded. Further online purchasing developments on the website will occur in 2014/15

Redefine the corporate risk Board reviewed the corporate Extensive work undertaken management profile and risk management profile and on development of risk framework framework management

Programmable, relocatable Not implemented as a result Not implemented digital public information of transition to Belgravia board Leisure. Further investigation required

Complete SnowCore software SnowCore finalised and • Skier days as % of total package for enhancement implemented visitor days increased of ticketing and ski lesson from 15% in FY13 to 21% management • Lift ticket purchases increased 100% on FY13 • Snow sports revenue increased 300% on FY13 Satisfaction surveys indicated: • Ski and Snowboard School experience up 0.3 to 3.9 out of 5 • Ease of ticketing transaction rated highly (3.8)

PAGE | 16 STRATEGIC OBJECTIVES KEY ELEMENT OUTCOME MEASURES OF PERFORMANCE

2 Delivering Resort Provide public BBQ shelter in Due to the Belgravia Not implemented services and top car park transition this project was infrastructure efficiently put on hold pending further and accountably cont’d investigation in 2014/15 Construct new toilets in bowl Due to the Belgravia Not implemented area transition this project was put on hold pending further investigation in 2014/15

Deliver Wi-Fi to all areas of Wi-Fi introduced to all areas The accommodation resort of the Resort net promoter score for accommodation services increased from 3.6 to 3.9 out of 5. The system worked well with minimal interruptions throughout peak periods

Develop partnership and Due to the transition of Not implemented sponsorship program with Belgravia and very good snow local primary school to conditions the resources were encourage custodianship of not able to be deployed to the Resort deliver this objective

3 Building partnerships Develop sponsored cultural Cultural program Program included: program at resort based upon implemented • ArchiBawBaw/ history and local culture Portraiture • Writer in Residence Jindivick Sculpture Show

Partner with GippsTAFE to Due to the Belgravia Not implemented establish live in learning transition this project is centre at Mt Baw Baw currently being investigated

Establish improved resort Access and programs were Ramp was added to the Guest access, programs and considered and implemented Information Hub and ‘Access facilities for people with during FY14 for All’ ski lessons were disabilities available

Be an active member of the Resort Manager attends Participated in meetings Baw Baw Shire Business meetings with the Baw Baw Development Board Shire Development team

Continue active membership Resort Manager/CEO is an Active participation in of the Committee for active Committee member meetings Gippsland

Realign Pudding Basin Funding could not be sort and Not completed walking track to protect project not completed endangered Baw Baw Frog habitat

4 Respecting the alpine Establish Geographical GIS is established and Reviewed annually environment Information System part of the Environmental (GIS) layers for future Management Plan environmental master planning

Develop green energy Strategy focusing on 60% Not implemented initiatives to reduce savings in energy developed greenhouse gases, reduce for upcoming green season energy costs

PAGE | 17 STRATEGIC OBJECTIVES KEY ELEMENT OUTCOME MEASURES OF PERFORMANCE

4 Respecting the alpine Update Environmental Environmental Management Annual review completed environment cont’d Management Plan Plan was reviewed and and submitted to DELWP for updated approval

Implement “All Abilities” Meet contemporary standards Currently working with a access initiatives within the for all inclusive access number of disability agencies resort through Belgravia’s National Disability and Diversity Manager

5 Broadening access Further develop the Arts and Arts and Culture program Program included; opportunities Culture project to include delivered • ArchiBawBaw/ diverse range of opportunities Portraiture and activities • Writer in Residence Jindivick Sculpture Show

Update Resort Strategic Plan Deferred to FY15 On hold due to the transition to reflect the intent of the of Belgravia and 1 year Alpine Resorts Strategic Plan management agreement in 2012 place

6 Regulatory reform Develop a Master Plan for the Completion date for the On hold due to the transition resort Master Plan was deferred to of Belgravia and 1 year late 2015 management agreement in place

Complete a fire management Fire Management Plan Annual reviews. Submission plan for the Resort and completed to DELWP for approval update annually

Complete an Emergency Emergency Management Annual reviews. Submission Management Plan for the Plan completed to DELWP for approval Resort and update annually

Purchase and commission Commissioned and Reporting and integration Tencia integrated financial implemented has been a challenge for staff reporting and integration and further investigations software ongoing.

7 Financial Framework Identify and value resort Due to Belgravia’s transition Not implemented Community Service this project has been delayed Obligations (CSOs) and will be completed in 2014/15

Provide financial reports to Quarterly reports provided Implemented DELWP including quarterly financial reports

8 Governance Framework Corporate Plan to include Corporate Plan including Implemented 2012 Strategy Key 2012 Strategy completed Performance Indicators (KPI’s)

Report on implementation of ARCC reporting requirements Implemented 2012 Strategy completed

Discussed and reviewed at Report on compliance with Meet Government regulations Board meetings and outlined Competitive Neutrality Policy in Annual Report

PAGE | 18 Report against the Corporate Plan KPI’s The table below summarises the Resort’s performance against the KPI’s contained in the 2013/2014 Corporate Plan.

Chart 8: 2013-2014 KPI performance

KEY PERFORMANCE INDICATOR MEASURE 2012/13 RESULT 2013/14 RESULT 2013/14 TARGET VARIANCE TO TARGET

FINANCIAL GOALS

Increase gross yield/ Gross yield/visitor $23 $35 $45 -$10 visitor

Decrease in Govt. Decrease in Government financial support – $3.3m $3.6m $3.2m -$0.4m financial support 5 year average

EFT staff from Increase in regional jobs 10 EFT 12 EFT 12 EFT - Gippsland Region

Develop investment Investment program Completed Completed Complete - program finalised

Meet Corporate Plan Targets met Did not meet Did not meet To meet - financial targets

Increase annual visitor Increase in winter visitor and visitor days – 5 year 58,063 93,441 46,200 +47,241 numbers average

Increase winter Winter occupancy – 44% 64% 50% +14% occupancy rates 5 year average

Identify and have funded Identify and quantify nil nil 100% - CSOs CSOs

Decrease ratio total Wages as % of total wages (on costs) / Total 35.4% 23.2% 45% -21.8% expenditure expenditure

ENVIRONMENTAL GOALS

Reduce energy Total KwH used in 2% decrease To be assessed Reduce by 2% NA consumption Resort

Implement renewable Increase by 1%/annum 0% reduction Not achieved 1% reduction - energy generation

Decrease in solid waste % decrease in waste to 2.1% Not achieved 2.3% - to landfill landfill

Met Meet Study in place Number of habitat Environmental Environmental Implement habitat for Baw Baw protection programs Management Management - protection programs Frog habitat implemented Plan Plan protection requirements requirements

Meet all DoH 100% 100% 100% Water Management 100% requirements compliance compliant compliance

PAGE | 19 KEY PERFORMANCE INDICATOR MEASURE 2012/13 RESULT 2013/14 RESULT 2013/14 TARGET VARIANCE TO TARGET

SOCIAL GOALS

Completion of visitor % increase in number -63% -30% +5% -33% satisfaction surveys of surveys completed

Visitor ethnicity profile State ethnicity profile Met Met To meet - approaches State profile met or bettered

Increase beds available Number of available 9% increase No increase 5% increase -5% through CABS resort beds on CABS

On mountain services Number of on mountain No result 4 No target set +4 increases services recorded

CULTURAL GOALS

Employ Indigenous employment Number of positions No indigenous No indigenous minimum one -1 opportunities created available for indigenous employees employees indigenous staff member

Number of events Events celebrating recognising resort 10 10 6 +4 resort heritage increase heritage

OTHER GOALS

Improve Stakeholder New stakeholder 4 12 3 +9 consultation programs forums attended

Planning timelines meet Time to facilitate Met Met To meet - Council norms planning application

Lease inequities Number of leases 0 0 0 - removed containing inequities

Minimise ski field Ski field incidents per 2.26 3.01 2.73 +0.28 incidents 1,000 visitor days

PAGE | 20 GOVERNANCE & ORGANISATIONAL STRUCTURE

Organisational structure Chart 9: Organisational chart

Board of Management Vicky Papachristos – Chairperson Randall Cohen – Deputy Chairperson Ben Dunlop – Member Wally Tabnesky – Member Jacqueline McLeod – Member

Audit & Risk Committee Randall Cohen – Chairperson Administrative and Commercial Operator Accountable Officer Vicky Papachristos – Member Board executive services Belgravia Leisure Pty Ltd Simon Mahony – Member Craig Jensz Lion Capital Advisory Pty Ltd Wally Tabensky – Member

Resort Manager Alex Flint

Guest Experiences Outdoor Operations Food & Beverage Events & Experiences Manager Manager Manager Development Manager Kaye Hawkins Mal Rowsell Jason Lowe Grant Seamer

Prior to Belgravia’s appointment, the day- number of staff were redeployed to other to-day running of the organisation was roles at the Resort where possible, however undertaken by the Chief Executive Officer, there were some redundancies. Alex Flint Stuart Ord and a year round workforce, was employed as Resort Manager, replacing supplemented by seasonal staff and Stuart Ord who finished at the Resort in late volunteer ski patrollers. August 2014.

Following Belgravia’s appointment as the Those staff employed by the Board that commercial operator, the Board conducted continued employment at the Resort after the an organisation restructure. The new staff restructure, remain employed by the Board. structure was implemented throughout May All new staff were employed by Belgravia and June as shown in the organisational with reference to the Mt Baw Baw Alpine chart above. With the aim of reducing Resort Management Enterprise Agreement. overhead costs and improving Mt Baw Belgravia is responsible for the management Baw’s financial viability, functions including of staff employed by the Board, as well as corporate services, human resource support, Belgravia staff working at the Resort. financial management, payroll and accounts receivable/payable were all transferred to Belgravia Head Office under a shared services model. As a part of this process a

PAGE | 21 Objectives, functions, powers & duties l Enhancing the visitor experience and developing resorts As the committee of management of Mt Baw Baw, the Board is focused on developing, l Delivering resort services and promoting, managing and using Mt Baw infrastructure efficiently and accountably Baw in an environmentally and financially l Building partnerships sustainable way for alpine recreation and l Respecting the alpine environment tourism in all seasons by persons from varied cultural and economic groups. l Broadening access opportunities

The Board’s functions are outlined in S38 of l Regulatory reform the Alpine Resorts (Management) Act 1997 (“Act”), whilst its powers are prescribed by S39 and 40 of the same Act.

The Alpine Resorts Strategic Plan 2012 also provides guidance for the long term planning and management of Victoria’s six alpine resorts, and has as its guiding vision that:

Victoria’s alpine resorts will be vibrant, growing and sustainable places, delivering alpine recreational and tourism experiences that are available to all.

Incorporating requirements under the Act and Alpine Resorts Strategic Plan 2012, the Board has developed and adopted a Corporate Plan (which it does annually) that outlines its objectives, and the actions that it commits to undertaking in order to fulfil it functions, exercise its powers, satisfy the Minister’s statement of expectations and fulfil its objectives.

In line with the six key objectives of the Alpine Resorts Strategic Plan 2012, the Board has outlined the following objectives in its Corporate Plan:

PAGE | 22 Governing Board b) to contribute, together with Tourism Victoria, established under the Tourism Board Functions Victoria Act 1992, and the Council, to the The functions of the Board as set out overall promotion of Alpine Resorts; under Section 38 of the Alpine Resorts c) to develop a tourism and marketing (Management) Act 1997 are: strategy for and to promote the resort aa) to plan for the development, promotion, and to collect and expend voluntary management and use of the resort in contributions from commercial accordance with the object of this Act; undertakings in the resort for this purpose; ab) to: d) to provide services in the nature of – a) develop and promote; or a. garbage disposal; b) facilitate the development or the b. water supply; promotion by others c. gas; of the use of the resort in accordance d. drainage; with the object of this Act; e. sewerage; f. electricity; ac) to manage the Alpine Resort in g. roads; accordance with the object of this Act; h. fire protection; i. snowmaking; ad) to contribute to the development of the j. transport; Alpine Resorts Strategic Plan and other for the resort and to charge strategic planning for Alpine Resorts as a contributions for the provision of whole; those services; ae) to undertake research into Alpine Resort e) repealed; issues; f) to collect fees prescribed by the af) to contribute to and support the regulations for the resort; operation of the Alpine Resorts Co- ordinating Council; g) to attract investment for the improvement of the resort; and ag) to prepare and implement a Strategic Management Plan for each such Resort; h) to carry out any other function conferred on the Board by this or any other Act. ah) to expend or apply revenue of the Board A Board must perform its functions in an in accordance with a direction of the environmentally sustainable way. Minister under section 36(1A); a) to act as a committee of management of any Crown land deemed to be permanently reserved under the Crown Land (Reserves) Act 1978 in the resort;

PAGE | 23 Board appointments Board Member profiles Members of the Board are appointed by Vicky Papachristos – Chair the Minister for Environment and Climate Vicky has spent over 20 years as a Change. management and marketing executive with Appointments to the Board during the major corporations in Australia and the USA. reporting period November 1, 2013 to October Vicky’s work has spanned Petrochemicals, 31, 2014 were: Banking, Sport, IT & Retailing holding senior roles in Shell, Westpac, Visa, Myer, the Sydney Chart 10: Board members Olympics and Paralympics as well as an IT start-up in the US. BOARD MEMBER PERIOD OF APPOINTMENT

Chair April 2013 to 31 October 2014 Vicky’s expertise is in strategy and marketing Vicky Papachristos responsible for the design, development and Deputy Chair from 29 April 2010 to April 2013 launch of several major customer facing business initiatives. Vicky also has extensive Deputy Chair April 2013 to 31 October 2014 expertise in setting up new and enhancing Randall Cohen existing business operations. Board Member from 29 April 2010 to April 2013 In 2006 Vicky formed Currant Marketing – Board Member from 29 April 2010 to Wally Tabensky 31 October 2014 an independent consultancy in the fields of marketing, loyalty and customer strategy Board Member from 28 October 2011 Jacqueline McLeod to 31 October 2014 specialising in retail and consumer products.

Board Member from 21 June 2013 to Ben Dunlop 31 October 2014 Vicky also serves on two other Boards. She is an Independent Director of EFTPOS Payments Australia Limited, Australia’s most widely used domestic debit card system. Vicky is also a Director of GMHBA Private Health Insurance – a leading regional private health insurer head- quartered in Geelong.

Vicky is a keen skier and road cyclist and holds a Chemical Engineering degree as well as an MBA from the AGSM. She is a member of the Australian Institute of Company Directors and the Alpine Resorts Coordinating Council.

PAGE | 24 Randall Cohen – Deputy Chair services in state and local government and the private sector in Victoria and New South Randall has a wealth of professional Wales. Jacqui’s experience includes extensive experience in commercial and legal project stakeholder engagement and facilitation work for the public sector, the private sector and a track record of influencing at a range and at the interface between the public and of levels, through both formal statutory private sectors. Randall has assisted a broad processes of community consultation and array of Victorian Government Departments informal engagement at high levels of in delivery of major projects with emphasis government and industry. As a manager, on infrastructure, resources, energy, risk Jacqui has held a number of senior level management, litigation, and dispute resolution. positions over the last 15 years, involving Randall also has extensive experience in leadership of staff and multi-disciplinary leading projects for major private sector teams, business management, business companies in Victoria’s energy industry. Since improvement, organisational change and 1999, Randall has provided niche consulting business development. Jacqui also has broad services. Prior to that Randall worked as experience as a project manager, developing General Counsel and Regulatory Manager for project plans and costings, assigning team APA GASNet Pty Ltd, as Corporate Solicitor for roles, reviewing outputs and overseeing Alcoa of Australia Ltd, and as a solicitor with delivery to time and budget. major law firm, Mallesons Stephen Jacques. Jacqui is a long time downhill skier and has Wally Tabensky - Member skied most of the resorts in Victoria and NSW Wally holds professional engineering since being a teenager. qualifications and has vast experience in engineering and local government. He Ben Dunlop - Member has been employed with various local Ben is a fully qualified Certified Practising governments, commencing with the City Accountant (CPA), with in excess of seventeen of Springvale in 1968 and concluding his years’ experience in the accounting / finance working career upon retiring from his sector, including four years as Financial position as Director, Infrastructure and Accountant at Hawthorn Football Club. Environment, at the Baw Baw Shire in 2008. Wally has studied overseas, and has Ben has experience in a range of industry been a member of the Board and previous sectors including taxation, business services, Management Committee at Mt Baw Baw health sector, information technology and since 1989. sport and leisure, along with experience in the United Kingdom. Jacqueline McLeod - Member Jacqui is an environmental scientist and manager with over 25 years’ experience in environmental policy and strategy development, environmental impact assessment and regulatory and advisory

PAGE | 25 Chart 11: Board meeting attendance register

NUMBER OF #149 #150 #151 #152 #153 #154 #155 #156 #157 MEETINGS 13/12/13 21/02/14 21/03/14 22/04/14 23/05/14 28/07/14 28/08/14 26/09/14 24/10/14 ATTENDED Vicky Papachristos          9/9

Wally Tabensky  A    A    7/9

Randall Cohen          9/9

Jacqueline McLeod        A  8/9

Ben Dunlop A         8/9

(Tick = Attended) (A = Apology) Audit committee membership and roles l Randall Cohen, Chairman (independent) The audit committee consists of three l Vicky Papachristos (independent) (term members and a chairman. All members and commenced 13 December 2013) the chairman are independent members, as l Ben Dunlop (independent) (term ended 13 indicated below. Members are appointed by the December 2013) Board, usually for a three year term, and are l Wally Tabensky (independent) (term subject to the committee’s terms of reference. ended 31 October 2014) The role of the audit committee is to l Simon Mahony (independent). oversee and advise the Board on matters of accountability and internal control affecting Meetings are scheduled quarterly and at its operations. any other time on request of a committee member or the internal or external auditor. The main responsibilities of the committee In 2013-14, the committee met three times. include the oversight of: Attendance of committee members is l the financial performance of the Mt Baw Baw; detailed in the table below. l the financial reporting process; Chart 12: Audit & Risk Committee meeting l the scope of work and performance of the attendance register internal and external auditors; NUMBER OF #40 #42* #43 l MEETINGS the operation and implementation of the 12/12/2013 05/06/2014 28/08/2014 ATTENDED risk management framework; Randall Cohen    3/3 l matters of accountability and internal control affecting the operations of Mt Baw Baw; and Vicky Papachristos -   2/2 l the effectiveness of management Ben Dunlop A - - 0/1 information systems and other systems of Wally Tabensky    3/3 internal control. Simon Mahony    3/3

Membership of the committee in 2013-14 (Tick = Attended) (A = Apology) comprised: *Meeting #41 scheduled for February was cancelled

PAGE | 26 Nature and range of services provided Chart 13: Mt Baw Baw key stakeholders

The Board ensures that a number of services MT BAW BAW KEY STAKEHOLDERS are provided in the Resort including; 1 Minister for Environment and Climate Change l Water supply Victorian Department of Environment and Primary 2 Industries l Sewerage and drainage Other National & State Government Departments/ l Car park development and maintenance Agencies: • Parks Australia l Garbage and waste disposal • Parks Victoria l Electricity • Vic Roads Commercial operations including products 3 • Vic Forests associated with accommodation, snowboard • Tourism Vic hire, retail, ski school, lift ticketing, lifting, • DHS food and beverage; • Sustainability Victoria l Snow clearance • Dept. Planning and Community Development l Traffic control and parking • Ambulance Victoria l Trail grooming, construction and 4 Leaseholders maintenance 5 Other ARMBs l Ski patrolling 6 ARCC l Lease holder management Alpine community l Snow and weather reporting • SnowSports Industry l Tourism and education information • On Mountain Stakeholders • Resort communities visitor and user groups l Public shelters 7 • Sub alpine towns l Toilets • Outdoor Education Providers

Key stakeholders • Snow Australia The Board, together with management are • Volunteer Ski patrol focused on managing and improving the Local Government vibrancy and financial sustainability of the 9 • Baw Baw Shire Resort for the benefit of all stakeholders listed • Latrobe City in the table below. Regional Tourism Organisations

• Baw Baw Country LTA

10 • Gippsland Gourmet Country LTA

• Walhalla Mountain Rivers LTA

• Destination Gippsland RTB

11 Indigenous People

PAGE | 27 Incident management Department’s performance against OH&S management measures Mt Baw Baw is totally committed to establishing a healthy and safe work STAFF environment for our staff, contractors and TOTAL AVERAGE HRS/ OH&S TYPE NUMBER HOURS INDIVIDUAL visitors. All activities throughout the Resort AFFECTED are subjected to Occupational Health & Safety Sick Leave 14 449 32 (OH&S) reviews to ensure we are not placing WorkCover 4 359 90 staff or visitors at risk and to: l Encourage individuals to practice Employment and conduct principle work safety by providing information, Equal employment opportunity instruction and training; l Provide safe plant and systems of work; The Board is an equal opportunity employer and all appointments and promotions are l Ensure compliance with legislative merit based. The Staff Development and requirements and current industry Training program continued this year, again standards. identifying areas for development and The Resort ensured that the OH&S enhancement of skill levels. All staff are Representative underwent training during appointed through a process which responds 2014 to ensure maintenance of skills and to merit and equity. knowledge with respect to OH&S. Management Industrial relations continued to ensure Departmental OH&S meetings were conducted regularly, minuted There were no industrial disputes during and action items implemented. The Executive the reporting period. A new Enterprise Team met on twenty occasions during the Agreement was finalised and implemented in year at which time OH&S was a standard September 2014. agenda item. All incidents are investigated to ensure appropriate responses to any issue and Workforce data changes implemented as required. Training and development The majority of Staff at the Resort now have The Board encourages the training and first aid training. development of our staff through work related training and external study.

During the reporting year management has continued to improve staff skills through in- house training and using external providers in gaining Diplomas across a number of different disciplines.

PAGE | 28 Training programs undertaken included: The public sector values are: l Australian Ski Patrol Association (ASPA) l Responsiveness Advanced Emergency Care Course; l Integrity l Responsible Service of Alcohol (RSA); l Impartiality l Authorised Officer; l Accountability l Excavator; l Respect l Chainsaw; l Leadership l Drug and Alcohol; l Human rights l OH&S; The Board follows the employment and l Safe Food Handling; conduct principles set out in the Public l RMS (Accommodation Database); Administration Act, 2004 and ensures employment decisions are based on merit; l RTP (Resort Transactions Database); public sector employees are treated fairly and l Alpine driver training; and reasonably; equal employment opportunity l Customer Experience training. is provided; human rights are upheld; and employees have a reasonable avenue of Staff induction program redress against unfair or unreasonable The staff induction program is a compulsory treatment. program that is attended by all new employees and provides an overall induction into employment at the Resort.

Public Administration values and employment principles

Victorian Public Service values and principles are applied in the appointment and management of staff as outlined below.

PAGE | 29 Comparative workforce data

Chart 14: Staffing profile summary

2013/14 2012/13 2011/12

Male Female Total Male Female Total Male Female TOTAL

Executive Officers 2 0 2 2 1 3 2 1 3

Senior management 3 1 4 3 1 4 3 1 4

Other full time staff 8 6 14 8 7 15 11 7 18

Winter season staff 44 36 80 51 37 88 54 39 93

Total 57 43 100 64 46 110 70 48 118

Executive Officer data

An Executive Officer is defined as a person employed as a public service body head or other executive under Part 3, Division 5 of the Public Administration Act 2004.

As at 31 October 2014, Mt Baw Baw had two Executive Officers employed on an ongoing basis, one of which is the Accountable Officer. Note 19 in the Financial Statements details the amount of remuneration paid to Executive Officers over the course of the financial year.

Chart 15: Number of Executive Officers (ongoing and special projects)

ALL ONGOING SPECIAL PROJECTS

Number Variance Number Variance Number Variance

Remuneration less than $100,000 1 0 1 0 0 0

Remuneration greater than $100,000 2 0 2 0 0 0

TOTAL 3 0 3 0 0 0

Chart 16: Number of Executive Officers by gender (ongoing and special projects)

ONGOING SPECIAL PROJECTS

Male Female Variance Male Female Variance

Remuneration less than $100,000 1 0 +1 0 0 0

Remuneration greater than $100,000 1 1 0 0 0 0

TOTAL 2 1 +1 0 0 0

PAGE | 30 Chart 17: Reconciliation of Executive Officer Details of Consultancies over $10,000 numbers Chart 18: Consultancies over $10,000 FY13 FY14 TOTAL (EXCL. Executive Officers with total CONSULTANT SERVICES GST) remuneration over $100,000 2 2 (Financial Statement Note 19(c)) Marketing & Drive Climb Fly Pty Ltd $ 145,707 event services Executives employed with total Add 0 1 remuneration below $100,000 Maurice Copsey - Engineering $ 13,944 (Snowfield Engineering) services Less Separations (0) (1) Touchstone Australasia Project $ 68,067 Total Executive Officer numbers Pty Ltd management 2 2 at 30 October Commercial * Note that until the operational restructure, the Accountable Officer advice Lion Capital Advisory position was held by the CEO & Board $ 283,754 Pty Ltd administrative Other Disclosures support Adventure Types Pty Recreational $ 48,434 Implementation of the Victorian Industry Ltd services Participation Policy (VIPP) Allens-Linklaters Legal $ 101,104 Solicitors

The Victorian Industry Participation Policy Act Procurement RSM Bird Cameron $ 28,543 2003 requires Public Bodies and departments & probity to report on the implementation of the SnowCore IT Services $ 52,381 Victorian Industry Participation Policy (VIPP). The public tender process conducted by Departments and public bodies are required the Board to seek a commercial operator to apply VIPP in all procurement and involved the use of the following contractors: project activities valued at over $3 million l in metropolitan Melbourne and $1 million Allens-Linklaters for the provision of legal in regional Victoria. The Resort has not advice to the Board; commenced or completed any contracts l Lion Capital for the provision of during 2013-14 to which VIPP applied. commercial advice to the Board;

Consultancy expenditure l Touchstone Australasia for tender process project management; and The definition of consultancy was updated l  effective from 1 July 2013. Consequently, RSM Bird Cameron for the provision of disclosures on the 2013-14 consultancy probity advice and assurance. expenditure cannot be compared with Belgravia was selected as the commercial previous year disclosures. operator following the public tender process, The Board outsourced a significant number and is the contractor to manage and operate of its activities during the year as shown in the Resort. Lion Capital has an ongoing role to the table below. These contracts/expenditure provide administrative support to the Board. have been reviewed within Auditor General annual processes.

PAGE | 31 Details of consultancies (valued at $10,000 During the reporting period (ending 31 October or greater) 2014) one request for information was received.

In 2013-14, there were 8 consultancies where Written requests, as detailed in Section 17 of the total fees payable to the consultants were the Freedom of Information Act 1982 should be $10,000 or greater. The total expenditure forwarded with the prescribed fee to: incurred during 2013-14 in relation to these  Craig Jensz – Accountable Officer consultancies is $741,934 (excl. GST). Freedom of Information Officer Details of consultancies (valued at less than Mt Baw Baw Alpine Resort $10,000) PO Box 117 RAWSON VIC 3825 In 2013-14, there were 2 consultancies engaged during the year, where the total Information fees payable to the consultants was The Board held and maintained the following less than $10,000. The total expenditure categories of documents: incurred during 2013-14 in relation to these consultancies was $10,080 (excl. GST). l Correspondence files; l Disclosure of major contracts Minutes of the various meetings held by the Board; Mt Baw Baw did not award any contracts l Technical reports and statistical valued at $10m or more during 2013/14. information on Mt Baw Baw management Major external reviews matters;

The Board has not participated in any major l Leasehold documents related to Mt Baw external reviews during the reporting period. Baw sites; plans, charts and other data covering Mt Baw Baw operations and Overseas visits undertaken planning.

No overseas study visits occurred during the Reports and general information related to reporting period. the Board are available for inspection at the office of the Board. The Board’s website is Freedom of Information a source of considerable information. The The Board is considered to be a Government fee for any FOI application is $26.50. Other Agency under the terms of the Freedom enquiries may be sent to Craig Jensz, as of Information Act 1982. The Act allows the Authorised Officer of Mt Baw Baw, PO the public a right of access to documents Box 117, Rawson, 3825, stating as clearly as held by the Board. Freedom of Information possible the nature of the request. Once the requests are made in writing describing the Annual Report is tabled in Parliament, it will documents requested. then be placed on the Board’s website.

PAGE | 32 Compliance with Building Act 1993 Purchasing of Goods

The Municipal Building Surveyor (MBS) at The Board, as an independent manager Mt Baw Baw is John Austin. Inspections of of and investor in the Resort’s assets, lodges were principally undertaken by a CFA purchases services and goods, in line with officer or by John Austin. The majority of lodge the Victorian Government’s Purchasing leaseholders remain proactive and able to Guidelines and Victorian Industry demonstrate compliance relating to the testing Participation Policy disclosures. In doing this, of fire safety equipment at the commencement the Board applies the following principles: of the ski season. l Value for Money; Building-related risks have been identified l Open and Fair competition; and reduced, and the building owners and l Accountability; managers are far more aware of their responsibilities and options to achieve l Full Cost Recovery. compliance with maintenance of essential Compliance with the Protected Disclosure services. Again the year was free of any major Act 2012 structural fire incidents and education of owners and safety for occupants was improved. The Protected Disclosure Act 2012 (PD Act) enables people to make disclosures about A fire summit is held at the Resort every year improper conduct by public officers and (conducted by CFA) along with an annual fire public bodies. The PD Act aims to ensure prevention weekend in late November. openness and accountability by encouraging National Competition Policy people to make disclosures and protecting them when they do. The Board adheres to the principles of the National Competition Policy (NCP) to ensure What is a ‘protected disclosure’? that any business competition with private A protected disclosure is a complaint of entities takes place in an environment where corrupt or improper conduct by a public the Board has no competitive advantage. officer or a public body. Competitive neutrality seeks to enable fair competition between government and private sector businesses. Any advantages or disadvantages that government businesses may experience, simply as a result of government ownership, should be neutralised. The Board continues to implement and apply this principle in its business undertakings.

PAGE | 33 The Board is a “public body” for the purposes Contacts of the PD Act. Department of Environment, Land, Water What is ‘improper or corrupt conduct’? and Planning Jennifer Berensen Improper or corrupt conduct involves Senior Advisor - Privacy & Ombudsman substantial: Department of Environment, l Mismanagement of public resources; or Land, Water and Planning l Risk to public health or safety or the Address: PO Box 500, environment; or East Melbourne Vic 8002 l Corruption. Ph: (03) 9637 8697 The conduct must be criminal in nature Website: www.delwp.vic.gov.au or a matter for which an officer could be dismissed. Independent Broad-Based Anti-Corruption Commission (IBAC) Victoria How do I make a ‘protected disclosure’? Address: Level 1, North Tower, 459 Collins You can make a protected disclosure about Street, Melbourne Victoria 3000. the Board or its Board members, officers or Mail: IBAC, GPO Box 24234, Melbourne employees by contacting DELWP or IBAC on Victoria 3001 the contact details provided below. Website: www.ibac.vic.gov.au Please note that the Board is not able to Phone: 1300 735 135 receive protected disclosures. Email: see the website above for the secure How can I access the Board’s procedures for email disclosure process, which also the protection of persons from detrimental provides for anonymous disclosures. action? Disclosure under the Protected Disclosure The Board has established procedures for the Act 2012 protection of persons from detrimental action in reprisal for making a protected disclosure In FY14 there were no disclosures received. about The Board or its employees. You can Compliance with DataVic access policy access the Board’s procedures at its office. Consistent with the DataVic Access Policy issued by the Victorian Government in 2012, the Board intends that data tables that it may produce in the future will be available at www.data.vic.gov.au in machine readable format.

PAGE | 34 Summary of environmental Additional information included in the performance annual report

A target reduction of an annual 10% in energy Details in respect of the following items have usage within the office environment has been been included in this annual report: set. Lighting within the office is progressively l Assessments and measures undertaken being converted to more energy efficient to improve the occupational health and units. Winter heating costs are monitored and safety of employees; alterations to the hydronic office system made as appropriate. l A statement on industrial relations for the Board, and details of time lost through The Resort has ensured that all photocopiers industrial accidents and disputes; are set to black and white and double sided l  as standard defaults. Photocopier paper is A list of the major the Board committees; recycled where possible, and one sided used the purposes of each committee; and the paper reused for office scrap writing paper. extent to which the purposes have been achieved; and Additional information available on request l A statement of completion of declarations The following information is available of pecuniary interests by relevant officers; from the Accountable Officer, Craig Jensz, l Details of changes in prices, fees, on request, subject to the Freedom of charges, rates and levies charged by the Information Act 1982: Board; and l Details of shares held by a senior officer l Details of all consultancies and as nominee, or held beneficially in a contractors. statutory authority or subsidiary; l Details of publications produced by the Board, and how these can be obtained; l Details of any major external reviews carried out by the Board; l Details of major research and development activities undertaken by the Board; l Details of overseas visits undertaken, including a summary of the objectives and outcomes of each visit; and l Details of major promotional, public relations and marketing activities undertaken to develop community awareness of the Board and its services.

PAGE | 35 Risk Management Attestation I , Craig Jensz certify that Mt Baw Baw has complied with Ministerial Direction Attestation for compliance with the 4.5.5.1- Insurance. Australian/New Zealand Risk Management Standard

I, Vicky Papachristos certify that the Board has risk management processes Craig Jensz in place consistent with the Australian/ Accountable Officer, Mt Baw Baw Alpine New Zealand Risk Management Standard Resort Management Board AS/NZS ISO 31000-2009 and an internal control system is in place that enables Gifts, Benefits and Hospitality the executive to understand, manage Attestation and satisfactorily control risk exposures. I, Vicky Papachristos certify that: The Board’s Audit & Risk Management Committee verifies this assurance and •  my public entity has gifts, benefits and that the risk profile of the Boa rd has hospitality policies and procedures in been critically reviewed within the last place; 12 months. •  these policies and procedures are consistent with the minimum requirements and accountabilities outlined in the Gifts, Benefits and Vicky Papachristos Hospitality Policy Framework for the Victorian Public Sector – Revised Chair, Mt Baw Baw Alpine Resort April 2012 issued by the Public Sector Management Board Standards Commissioner; and Insurance Attestation  •  these policies and procedures are Attestation for compliance with the updated, promulgated and provided to Ministerial Standing Direction 4.5.5.1 the audit committee for review at least – Insurance once a year.

Mt Baw Baw is insured with the Victorian Management Insurance Agency under the Victorian Managed Insurance Authority Act

1996 (VMIA Act) apart from the vehicle fleet Vicky Papachristos which is insured through QBE Insurance Chair, Mt Baw Baw Alpine Resort Australia. Management Board

PAGE | 36 AUDITOR’S REPORT

INDEPENDENT AUDITOR’S REPORT

To the Board Members, Mt Baw Baw Alpine Resort Management Board

ITNDhe EPEFinancNDiaEl NReTp AorUt DITOR’S REPORT INDEPENDENT AUDITOR’S REPORT The accompanying financial report for the year ended 31 October 2014 of the Mt Baw Baw AINDlpinEPEe ResNDorEt NMTa nAaUgDemITeOntR B’So aRrdEPwOhiRchT comp rises the comprehensive operating statement, bTaol athncee B oshaerdet M, embstatemerse,nt M to fB achwa Bngaesw Ailnpine equ Ritye,s ocasrt Mh afnloawg esmentatemet Bnota, rdn otes comprising a INDEPENDENT AUDITOR’S REPORT sumTo thmea rByo aordf sMigembnificaernst , Macct Boauwnt iBnga wp Aolilpinecies Raensdo rotht Mearn aegxepmenlanatot Bryo ainrdfo rmation, and the declaration by the chairperson and accountable officer has been audited. Tohe t hFein Bancoairdal RMeembport ers, Mt Baw Baw Alpine Resort Management Board ThTohe t hBFaeioccompann aBarncoda Mirdale RmMyebiembnpegorr s’fti enRrasen,sp cMiaotlns Breaibpwiorli tByt afowr tAthhlepinee Fyiena Rrnc eesinaodl rRet deM p3aort1n aOgcetmenobert 2B0o1a4rdo f the Mt Baw Baw TAhlpein Fbaeoiccompan naRaresncd moiarelt mRMyebianpengorras ftg i onefam tnhecenia tM l Btr eoBpaaorrwdt wBfoahrwi cht hA ecomplp yineea rrR iesesesndo erttdh M e3 acom1n aOgcpetromebheeenrnt 2sB0ivo1ea4 rodop arfera teh etries nMgp t soBtnaastemewib leB afnowtr, tAhlep inprepe Resaratiorto nM aannadg efamire npreset Boanrtdatiwohni chof compthe firnisesanc itahl er ecomportp rienh eaccnsiovred aoncperae wtinitgh sAtausttemeraliannt, bTahlea naceccompan sheet,y isntga temfinaenntci aol fr echporant gfoesr thine eyqeuairt ye, ncasdedh 3f1lo Ow cstotabteemer 20n1t4, noof tteshe cMotm Bprisawi nBga wa AbTahccolea nFuceintina nncshg ieaSetlt aR, nesdptaorartdemt s, eantnd othf ech fiannagncesia l inre peoqrutiintyg, rcasequhir efmlowen tsst aotfeme then Ft,i nnaonctesia l cMoamnprisagemening at sumAlpinmea Rryes oofr t sMigannifaicagenmt eaccnt Boouanrtdingw hpicholi ccompies arinsesd oththee rcom exprlaenhatoensriyv ei nofpoerarmatitinogn ,s taatnemed tnhte, AsumThcte m1a9ccompana94ry , oafn ds yigfionnrgi f iscafiuncnahtn ciaccnteial roneuapnlor ticnt ogfn otrpr oothlli ecas iesy et ahrae n ebdno darothedd e3mr1 e eOmxcbpteloarbnseato rd e2rt0ye 1rm4inifonofer m thiatise noMentce, Basasarnwd Byt ahtweo dbeaclalarancet ioshn ebety ,t hset achtemairepnterson of chanadn accgeso uin taebqluei toyff, icecasr ha sfl obwe esnt aatuemeditendt., notes comprising a dAeenlpcailnbaraele Rttihoesen obpryrte tMpharea nachatigoaenirm paersonenndt Bfa oiara nrpddr esaccwehniochtuatin comptoanb leo fro itsesffhiece frti nhhaeanc scom biael eprnere pahouerdtn isttehivdae.t iosp erafreet infrgo mst amtemeaterniat,l summary of significant accounting policies and other explanatory information, and the mbThaissleanBtaceotemea rshd Mentete, mw, bhsetarths’temeRr eduntspe o tonsof fichrbailiuatdyn gofoesr re trrhinoe r .Feiqnuaincty,i acasl Rehp ortflow statement, notes comprising a dThecelaraBoatiordn Mbye mthbee chrs’aRirepersonspons iabnilidty accforo tuhnet aFbinlea ncoffiaicel Rr ehpaorts been audited. Tsumhe mboaaryrd omf emsigbneirfsica ofn t heacc Mto uBnatwin gB apwo liAclpiesin e aRnesd oothrt Mear neaxgpelmaneatont Bryo airndf oarrmeati resonp,o nasnibdl e tfhoer Auditor’s Responsibility tdTThhehece l araprepBboatiroradnr ati mMbeyo mnth beae nchrss’d aoRfifar eptirhsperson eprese oMnst iBabnnailitdwatity accBofoanrw o touh Afne lt tpaFhibinenle af nciRonffesaiainceloc Rrirat e hlM parortasen pbaoregete nmi nae unaccdt itBeoodra.d radnc aree wresithp oAnustsibrlael ifaonr tAhse reprepquiraerdati boyn t haen dA ufdaitir Apresect 19n94tati, omny oresf tphoen sfiinbailintyc iaisl troe peorxpresst in acc an oordpainncione owni thth eA ustfinarancliaianl AThccoe buontiarndg m Setamnbdearrsd so,f athned Mtht eB fainwa Bncaiwal Arelppionret inRges reoqrtu Mireamnaegnetsm oefn tth Beo Fairnda arnceia rles Mpaonnasgibemenle fort ArTheccopeorBut ontibaarnsedg MdS etoamnnb dteharers’d saR,u edaspint,d o wnsthheiichb filii nthyaancfso riba telh eren Fp cooinratnincndguctedi arle Rque ipirneort maccordancents of thee wFitinha Ancusiatlr aMlian aAguemenditingt Athcet prep1994a, ratianodn foarn ds ufcahir ipresenternanlt aticoonntr ool f asth et hfein abnocariadl rmepeormbt einrs accdetoerrdmaincnee isw inthe ceAustssarrayli atno ASThctate n 1bd9oa94ardrds, . maTnehdmo sefboer r ssst auoncfd htardsh einte M rt neBaqalu wicr eoB ncatorwom lA pasllpiai nntehce eR wesbiotoharr trd eM lemavneaamngtbe eethmrse incadt eBl treoeraqmrudini rareemen eis r esntsep ceorenslsatisaribnleyg fotor Aenccoabulenti thneg pSrteapnardaartdiosn, aanndd tfhaeir fipnraesnceinatlati reopno rotifn gth ere qfinuairncemiaeln rtse poofr tt hteh aFt inisa ncfreiael fMroamn amgemenateriatl teahnuead bitprep lee nthgaear atigperoemnpe aranntasdt io afnan idar npresetdh afat irtn hpteatir esoaenun dtoiatitf bothene opffli antnahneec fdiain l aarncnedpi aorlp ter erinfpo oraccrmt ethdoa rdtt oais nc ofrebe teaw iniftr hor meAa ustmsoatrnaealribaialnel Amcisst 1ta9t94eme, annt,d w fhoer thseurc dhu iente tor nfralu dc oonrt reorrl oasr. the board members determine is necessary to Amassccoissutruaantitnemecneg a nSbt,to awunthd weathrhdeestrh, edaurn etdh tetoh fefirn aafuincnda incoarl ieraerrl prooerr.pt oisrt ifnrege r efrqoumir emmaeterintsa lo mf itsshet aFtemeninanctia. l Management Aenuadbitloer ’sth Re esprpeopnarsiabtiiliotny and fair presentation of the financial report that is free from material Acnt a1u9d94it ,i navnodlv esfor pseurcfohr minteingr nprocedal conturorel sas to thoeb tabionar adu dmit eemvbideersnc dee taebromuint eth ies anmeceousntsars ya ntdo Amsuiss driettoaqrtueme’sir eRdesn btp,y ow tnhseitb hAilieutryd ditu Ae ctto 1fr9a94ud, omr ye rrresorp. onsibility is to express an opinion on the financial deinscablosle utrhese pirneptharea tfiionna nacniadl fareirp oprt.es eTnhteati aound oit f pthroce efindauncresia lse relepcotret dt hdaet pise nfrde eo nfr ojmud gmeatmeerniat,l rAmesuipss dorietrtotaq rtubeme’siar eseRdesnd bt p,oy ow ntnh tsehibt ehAi lieautryud dditu it,Ae cwtto h 1firch9a94u dh, aomsr yeb rrereseonrp. oconsnidbuctedility is itno aeccordancxpress aen wopitihn iAonus otrna ltihaen fAinuadncitiniagl irnceplourdti nbga sethed asson ethses mauednitt, o wf thhiech r ishksas obfe mena tcoerinadl uctedmissta itneme accordancnt of thee fiwniathnc Aiausl rteraploriant, Awuhdeitthinegr SAtsa nredqaurdirse.d T bhyo sethe s Ataundditards Act r1e9q94uir,e m cyo mresplpiaonncesib wiliittyh isre tleov eaxnpresst ethica anl roepqiuniiroemenn on ttsh ere fliatinanncg itaol SAdutuaedn itdoar r’fsrda sRu. esdT hoporo senesrr iobstrilia. tnIynd ardsmak inregq tuhiroes ec ormiskp lassiancees swmitehn rtesl,e covannst idetheriacatiol nr eiqs ugirivemenen tot st herelatiintnegrn taol raeupdoitr t ebnagseagde omne nthtse aaunddi t,t hwaht ichth eh aasu bdeit enb eco pnldauctednned iann da ccordancperformed w ittoh Aousbtatrina liarena Asoundaitibnlge Acoausnd rtietr oqleu rniergeleadgv abenym t etthnoet s thA eua dneitdntit Atchyt’as t1 prepar9t94he, maauytdi oritesn bapeno dnp sfliabinilir ntpyer desis eatontn dae txipopressenr foofr mtahened of inptoain nioconiba tloa rnine pthorerta fsoiin anordncabiealerl Sasstanudraanrdcse. aTbhoouset w shteatnhdeardsr the rfeinqauncireia cl oremppolriat nisce fr ewei tfhro rme lemvaatnerit ethal micaissl traetqemenuirement. ts relating to rtassoe pdesourrta igbnnac esea audbd oiot unpt r twochheee dathuerdesri t,th tweh ahfitnch aar nceh aiaspl prorbeepeponrri att coise nfirnde uctedteh efr ocircm in mu amaccordanctseritaanlc mesiss, eb tuawtt iementnhot A fusotr. ttrhaelia pnu rApuosdieti nogf Aaund iat uednit giangveomlvesen tsp earfnodrm tihnagt procedthe auudriet s bteo polbatnanine da uadnitd epviedrefoncrmee ad botou t otbhtea ina mroeuantsosn aabnlde Sextapressndaridnsg. Tahno seop isntiaonnd ardson t hreq ueifrfe cctiovmenpesslian ceof wtheith reenletivtya’nst iethnteircanal l recqountirremenol. Ants areuldatiit nagl sto dAassinsc ualosruadnuicrt esei na vbionolvutesth we hpfeeintrhafoenrrcm tiahinle g rf einprocedpaoncrt.i aTl urhreep so artuto di sio tf brpetareoci nfr eoadmuud rmeit sae terivseidalel nccmteiessd atdabteoemenpuet ntdh te. o na mjuodugntesm eant,d iancudluitd esen gaegveamlueantintsg anthde thaapt ptrhoep riaateneudit sbse pofla ntnheed accando upnetrinfogr mepdo lictoies o btusaine d reasondn atbhle idncisclulosdinugr esth ei nassthees sfminaenct ioafl trheep orirst.ks T ohfe m aauteridita lp mrocissetdautemeres nset loefc theed fdineapnceniadl roenp orjut,d gwehmetehnet,r Aassrena souaruandnaictb elei nanvbessoolvues t ow f hpaeectrchfoeurrm nthtiineng gf i nprocedestancimiaatel urresep smo rtato di seo f brbetyae i ntfhr oeam ubd omitar aetderiv imdael ncmmbiesse ratsab,t oemenasut wthete.l l aasm oeuvntalus aatingd including the assessment of the risks of material misstatement of the financial report, whether dthiuscee olostvoera ufrraeslul presed inor tehnrretatio rf.ion Inan n omcf iathkl einr efginp taohnrot.cs iaeTl hrries pko aassrutd. ite spsrmoceendtsu,r ecos nsesidleecratetido nd iesp geinvde no tno tjheudgientmeernnat,l Adune atuod firta uindv oolrv eserr opre. rIfno rmmainkgin gproced thoseu rriessk assto oebstsamine natusd, icot envsiiddeencrateio na bios ugt ivtehne taom theountintse arnnadl iconcnlutrdoiln rge ltehvea assnt toe stshme eenntitt oyf ’sth prepare risksa otifo mn atnerid afal imr pissrestaetementatinotn oof ft hthee f ifninaancnciaial lr erepporotr,t winh ordether dIco ibscnetlilroseovl uerre estlhea vtai ntnhte tht oae u thdfieint aenvntitcidiaeylnc ’sr eepreparp Io hrt.a vaTet hiooebn t aaiunddei dt f aipsir ocspurefesfdicueierntensat taiseonndl e oacfp tetprohde pdfireniatepaennc tidoa l proorenp vojiudrdte g inae mbordaesneit,sr tdou edes toi gfrna auudd oitr perrrocoer.d Iunr esma tkhiantg a trheo aspepro rispk riassatee isns tmhee ncircts, ucomnstsaidnecreast,i obnu ti sn otgiv feonr tthoe thepurpintoseern oafl iftncor des lmudyii ngagnu dtahiute do assipt ipnrieoocsns.emduernest o tfh tahte a ries ksap proof mpraiatterie ainl mthiess circtatemeumsntat nocf etsh,e b fuint anncot iafol rr ethpeor pt,u rwphoseteh eorf ecoxpressntrol rienlge vaann t otop inthioen e ntiton y’tsh eprepar effecatitvioenn essand ofaf irt hepreseennttitayt’sio ninte of rtnhael fcinoantncroial.l rAenp oartu idni t ordalseor edxupresse to frinagu da onr eorrpionri.o Inn omna ktihneg tehfofescet ivriesnkess ass eosf smtheentesn, tcoity’nss iidnteerarntiaoln ciso ntgirvoel.n Aton theaudintit earnlsaol itnco desludesign aeuvdailtu partocinge dutrhese thaaptp arorep raiateneppropsrsiat eo ifn tthhee circaccumosutnatnincge s, pboulitc niesot fousr theed puarnpdos et hoef iconcnlutrdoesl r eleevvaanlut atotin tgh e tehntite ya’sp ppreparropriateneations asn do ffa irt hperes eaccntaotuionnti nogf thpeo fliincaiesnc iausl repd orta innd ord theer erexapresssonaibnlge naessn oopfi naioccno uonnt inthge est efifmecatetivse nmessad eo bf yt hethe ebnotiartyd’s minteemrbnearl s,c oasnt rwoel. ll Aasn aeuvadliut aatilnsgo troe adessoniganb laeundessit p roocf aecdcuoresun ttihnagt estareim aateppros pmriaatdee inb yth teh ecirc bouarmds tamnecmesb,e brsu,t asnot wfoerl lt hase peuvraplosuaeti nogf itnchel uodvesera ll epresevaluantitnatig ont hoef thaep fpinroapnrciiateneal repsosr t. of the accounting policies used and the ethxepress overainlgl presean onptiatinion oofn t hteh efin aenffceicatli vrenpessort. of the entity’s internal control. An audit also Ir ebaesolienvaeb tlheantess the oafu adcitc eovuindteinncg eest I himavatee osb tmaiandeed bisy stuhfefi cbieonart da nmde ampbproersp,r iateas wtoe lprol asv ideeva alu baatisnigs includes evaluating the appropriateness of the accounting policies used and the fIto hbree molievyvera aeu tdlhl iapreset to tphine inoatnuati.doit ne ovifd tehnce fein Ia hnacviael roebptaoirnt.ed is sufficient and appropriate to provide a basis reasonableness of accounting estimates made by the board members, as well as evaluating for my audit opinion. It hbee olievverae tlhl apreset the natuatidoit ne ovifd tehnce fein Ia hnacviael roebptaoirnt.ed is sufficient and appropriate to provide a basis for my audit opinion. Auditing in the Public Interest I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. PAGE | 37

Auditing in the Public Interest Auditing in the Public Interest

Auditing in the Public Interest

Auditing in the Public Interest AUDITOR’S REPORT continued

INDEPENDENT AUDITOR’S REPORT

Independent Auditor’s Report (continued) To the Board Members, Mt Baw Baw Alpine Resort Management Board Independence

TThhee AFuindaitncor-iaGl eRneeraporl’ts independence is established by the Constitution Act 1975. The Auditor- General is not subject to direction by any person about the way in which his powers and rTeshep oanccompansibilities areying t ofi nbaen ecixaercisl repeord.t Ifno rco thned uycetainr ge nthdee da u3d1it ,O thceto Abeurd i2tor01-G4 eonf erathel, Mhits Bsatawff Banadw dAelpleingeate Rses comport Mlieadn awgiethm aelln at pBpoliacardblwe hinichde pcompenderncisese rethqeu icomremepnretsh eonf sthivee A oustperaraltiainng accstaotemeuntinngt, prbaolfaessnceio nsh. eet, statement of changes in equity, cash flow statement, notes comprising a summary of significant accounting policies and other explanatory information, and the Odepcinlaraion tion by the chairperson and accountable officer has been audited. In my opinion, the financial report presents fairly, in all material respects, the financial position The Board Members’ Responsibility for the Financial Report of the Mt Baw Baw Alpine Resort Management Board as at 31 October 2014 and of its fTinhaenc bioaal rpde rmfoermmbaenrcse oaf ntdh eit sM ct aBshaw f loBwaws fAorlp tihnee yReesar otrhte Mn aennadgeedm ine nacct Boradradn arcee wresithp aopnpsliibcaleb floer Athuste rprepaliana rAaticcoonu ntianndg faSirt apresendardnst,ati aonnd othf et hfein afnincaianlc irael proreptiorngt rine qaccuiremordeantsnc eo fw tihthe AFustinarncaliiaanl MAacconaugntiemenng St Atacnt d1a9r94ds,. and the financial reporting requirements of the Financial Management Act 1994, and for such internal control as the board members determine is necessary to Neonna-bcomple theli apnrceep arwaittiho n tahned fFaiinr apncresiael ntMatiaonna goefm theen tf inAacnct ia1l 9r9e4p orat nthda t thise freAel pfirnoem Rmesateorritasl (mMiassntaagtemeemennt,) wAhcte 1th9e9r7 d ue to fraud or error. WAuitdhiotourt’ sm Roesdifpicationsoibni littyo the opinion expressed above, attention is drawn to the following matters. As indicated in Note 1(a) to the Mt Baw Baw Alpine Resort Management Board’s fAinsa ncreqiaul irepd obrty fothr e2 0A13ud–it1 A4,c t h1e9 B94oa, rmd yha ress coponntsraibvilietnye ids: to express an opinion on the financial report based on the audit, which has been conducted in accordance with Australian Auditing Sta•ndatrhdes .F Tinhaoncsei asl tManadnardsagem reqntu iArec t c1o9m94plibayn ceno tw ciothm rpelyleinvgan wt iethth tihcae lf orelloqwuiirnemeng Mintiss trerel atiforn g to audit eFningancgeem’se nSttsa nadnindg tDiharet ctthioen sa: udit be planned and performed to obtain reasonable Authorisations (2.4) - by delegating financial authority to its contracted service assurance oabout whether the financial report is free from material misstatement. provider An audit inovolRvesev epneurefo (r3.4min.1g) -procedby notu mreas intato inoibntga inef faeuctdivite einvtideernncale co anbtoroults tohveer a rmevoeunntuse and disclosures intrtahnesa fcintiaonncsi al report. The audit procedures selected depend on judgement, including thoe assCaseshs Hmaenndt lionfg t h(3.e 4ri.s2ks) - obfy mnoatt erimailn mtaiissnintagt emeeffecntti voef itnhteerna final nccoinatlr orelsp orovter, w casheth er due to fraud ohr aenrrdolirn. gIn a mnda kbianngk tinhgo se risk assessments, consideration is given to the internal Treasury Risk Management (4.5.6) - by virtue of its borrowing arrangements control releovant to the entity’s preparation and fair presentation of the financial report in order with a non-AAA rated financial institution to design audit procedures that are appropriate in the circumstances, but not for the purpose of • the Alpine Resort (Management) Act 1997 by virtue of its borrowing arrangements with expressai nnong a-AAn oAp rinateiond foinna ncthiea l einstituffectivtieoness. of the entity’s internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by the board members, as well as evaluating the overall presentation of the financial report. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion. MELBOURNE John Doyle 27 April 2015 Auditor-General

Auditing in the Public Interest

PAGE | 38 2 Auditing in the Public Interest

FINANCIAL STATEMENTS [XX] February 2015 For the ADDRESS year ended 31 October 2014 TO THE MINISTER

The Honourabl e Lisa Neville MP Minister fo r Environmen t, Climat e Change and Water Mt BawLeve Bawl 7 , 8 Nich Alpineolson St Resort Management Board DeclarationEAST MELBOURN by the ChairpersonE VI C 3002 and Accountable Officer The attached financial statements for the Mount Baw Baw Alpine Resort Management Board have been prepared in accordance with Standing Direction 4.2 of the Financial Management Dear Ministe r Neville Act 1994, applicable Financial Reporting Directions, Australian Accounting Standards including Interpretations, and other mandatory professional reporting requirements. MT B AW B AW ALPIN E RESO RT MANAGEMEN T BOAR D – ANNUA L REPO RT We further state that, in our opinion, the information set out in the comprehensive operating statement,We balance have much sheet, pleasure statement in submitting of changes to you in for equity, presentation cash flow to Parliament, statement the and Annual Report of the Mt accompanyingBaw Baw notes, Alpine presents Resort Management fairly the financial Board , transactionscovering the period during 1 November the year ended 201 3 to 31 31 October 201 4. October 2014 and financial position of the Board at 31 October 2014. The Annual Report has been prepared in accordance with the Financial Management Act 1994 and the At the timeAlpine of signing, Resorts (Management)we are not aware Act 1997. of any circumstance which would render any particulars included in the financial statements to be misleading or inaccurate. On behalf of the Board, we extend our appreciation for your sup port and also the support and cooperation of We authorisethe Department the attached of Environment financial statements and Primary for Industries issue on throughout 24 April 2015. the yea r.

Yours sincerel y,

Vicky Papachristos Craig Jensz Vicky Papachristos Craig Jensz Chairperson Accountable Officer/ Chair Accountable Officer Chief Finance and Accounting Officer

Melbourne Melbourne

24 April 2015 24 April 2015

2 | Page DRAFT

PAGE | 39 COMPREHENSIVE OPERATING STATEMENT For the year ended 31 October 2014

2014 2013 NOTE $ $

Income from transactions

Interest 2(a) 5,400 5,050

Sale of goods and services 2(b) 1,154,981 847,823

Government funding 2(c) 3,822,099 4,539,215

Site & service charges 2(d) 417,471 459,959

Visitor fees 2(e) 2,029,203 911,427

Other revenue 2(f) 361,749 216,848

Total income from transactions 7,790,903 6,980,322

Expenses from transactions

Employee benefits 3(a) 2,308,144 2,969,677

Depreciation expense 3(b) 1,050,868 1,086,922

Interest expense 3(c) 29,952 42,403

Supplies and services 3(d) 1,353,547 1,094,910

Utilities 609,896 578,537

Marketing expenses 677,556 479,791

Administration expenses 582,317 534,100

Contractor expenses 3(e) 1,321,294 -

Other operating expenses 3(f) 608,539 541,742

Total expenses from transactions 8,542,113 7,328,082

Net result from transactions (751,210) (347,760)

Other economic flows included in net result

Net gain/(loss) on non-financial assets 4 (1,793) (54,886)

Total other economic flows included in net result (1,793) (54,886)

Net result (753,003) (402,646)

Other economic flows – other comprehensive income

Items that will not be reclassified to net result

Changes in physical asset revaluation surplus 385,660 -

Total other economic flows – other comprehensive income 385,660 -

Comprehensive result (367,343) (402,646)

The above Comprehensive Operating Statement should be read in conjunction with the accompanying notes.

PAGE | 40 BALANCE SHEET As at 31 October 2014

2014 2013 NOTE $ $

Financial assets

Cash and cash equivalents 16 145,137 563,408

Receivables 5 957,522 168,933

Total financial assets 1,102,659 732,341

Non-financial assets

Inventories 6 80,889 76,955

Prepayments 7 107,966 133,017

Property, infrastructure, plant and equipment 8(a) 17,527,868 17,951,537

Intangible assets 9 23,901 -

Total non-financial assets 17,740,624 18,161,509

Total assets 18,843,283 18,893,850

Liabilities

Payables 10 1,077,960 528,546

Interest bearing liabilities 11 270,433 431,810

Provisions 12 235,449 298,378

Revenue in advance 13 57,770 66,102

Total liabilities 1,641,612 1,324,836

Net assets 17,201,671 17,569,014

Equity

Accumulated surplus/(deficit) (58,405) 694,598

Physical asset revaluation surplus 11,836,374 11,450,714

Contributed capital 14 5,423,702 5,423,702

Total equity 17,201,671 17,569,014

Commitments 17, 20

Contingent assets and contingent liabilities 19

The above Balance Sheet should be read in conjunction with the accompanying notes.

PAGE | 41 STATEMENT OF CHANGES IN EQUITY For the year ended 31 October 2014

ACCUMULATED PHYSICAL ASSET SURPLUS/ REVALUATION CONTRIBUTED TOTAL (DEFICIT) SURPLUS CAPITAL

$ $ $ $

Opening balance at 1 November 2010 2,327,052 6,335,613 5,074,552 13,737,217

Net result for the year 2011 1,125,565 - - 1,125,565

Contribution by owners - - 234,150 234,150

Other comprehensive income – change in - 5,210,827 - 5,210,827 physical asset revaluation surplus

Net effect of correction of errors in 2011 (i) (3,604) (95,726) - (99,330)

Restated balance at 31 October 2011 3,449,013 11,450,714 5,308,702 20,208,429

Net result for the year 2012 (2,357,906) - - (2,357,906)

Net effect of correction of errors in 2012 (i) 6,137 - - 6,137

Restated balance at 31 October 2012 1,097,244 11,450,714 5,308,702 17,856,660

Net result for the year 2013 (408,783) - - (408,783)

Capital appropriations - - 115,000 115,000

Net effect of correction of errors in 2013 (i) 6,137 - - 6,137

Restated balance at 31 October 2013 694,598 11,450,714 5,423,702 17,569,014

Net result for the year (753,003) - - (753,003)

Other comprehensive income – change in - 385,660 - 385,660 physical asset revaluation surplus Balance at 31 October 2014 (58,405) 11,836,374 5,423,702 17,201,671

(i) Refer to details of prior period error in Note 1(aa)

The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.

PAGE | 42 CASH FLOW STATEMENT For the year ended 31 October 2014

2014 2013 NOTE $ $

Cash flows from operating activities

Cash receipts in the course of operations 4,319,353 3,242,898

Cash receipts from Government 2,972,099 4,573,137

Interest received 5,400 5,050

GST recovered from the ATO 119,198 339,155

Total cash receipts 7,416,050 8,160,240

Cash payments to suppliers for goods and services (3,729,097) (4,382,047)

Cash payments to and on behalf of employees (2,369,372) (2,964,695)

Cash payments to contractors (1,297,290) -

Interest paid (29,952) (42,403)

Total cash payments (7,425,711) (7,389,145)

Net cash inflow/(outflow) from operating activities 15 (9,661) 771,095

Cash flows from investing activities

Purchases of non-financial assets (247,233) (552,497)

Proceeds from sale of assets - 67,500

Net cash inflow/(outflow) from investing activities (247,233) (484,997)

Cash flows from financing activities

Proceeds from borrowings 10,845 -

Repayment of borrowings (4,420) -

Repayment of finance leases (167,802) (92,008)

Proceeds - capital contributions by State Government - 115,000

Net cash inflow/(outflow) from financing activities (161,377) 22,992

Net increase/(decrease) in cash and cash equivalents (418,271) 309,090

Cash and cash equivalents at beginning of financial year 563,408 254,318

Cash and cash equivalents at end of financial year 16 145,137 563,408

The above Cash Flow Statement should be read in conjunction with the accompanying notes.

PAGE | 43 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 1: Statement of significant accounting policies

The Mount Baw Baw Alpine Resort Management Board (the Board) has been established pursuant to the Alpine Resorts (Management) Act 1997 (the Act), which outlines the functions, responsibilities and requirements of the Board. The annual financial statements represent the audited general purpose financial statements for the Board for the period ending 31 October 2014. The purpose of the financial statements is to provide users with information about the Board’s stewardship of resources entrusted to it. a) Statement of compliance These general purpose financial statements have been prepared in accordance with the financial reporting requirements of the Financial Management Act 1994 (FMA) and applicable Accounting Standards which include interpretations, issued by the Australian Accounting Standards Board (AASB). Notwithstanding that the general purpose financial statements have been prepared on the above basis; the Board has not complied with four Standing Directions of the Minister of Finance, which are issued pursuant to section 8 of the FMA. Specifically, the Board has not fully complied with Standing Direction 2.4: Authorisations, Delegations and Procedures as it has not complied with Procedure (i) which states that ‘An authorisation cannot be given to a contractor or consultant’. The Board has also not fully complied with Standing Direction 4.5.6: Treasury Risk Management, which requires all public sector entity borrowings to be with a financial institution that is either State owned or has a credit rating, assigned by a reputable rating agency, that is the same or better than the State of Victoria. The Board’s non-compliance with Standing Direction 4.5.6: Treasury Risk Management has also resulted in a breach of section 39 General Powers of Boards of the Act which are restricted and overlaid by the Standing Directions of the Minister of Finance. The Board has not fully complied with Standing Direction 3.4.1: Revenue and Standing Direction 3.4.2: Cash Handling, which require the Board to maintain an effective internal control framework over revenue transaction processing and cash handling/banking respectively. Non-compliance with Standing Direction 2.4: Authorisations, Delegations and Procedures

From 1 May 2014, management of the day to day operations of the Board was outsourced to Belgravia Health & Leisure Group Pty Ltd (Belgravia) under a management agreement. Belgravia, as part of this agreement, are also contracted to provide associated back office functions including finance and accounting, human resources, marketing andIT. Further details regarding this arrangement can be found in Note 1 (m) Expenses from transactions. Whilst the Board had internal controls in place, representatives of the contractor Belgravia were authorised by the Board to enter into transactions that obligated the Board to expenditure commitments. This is in contravention of Standing Direction 2.4: Authorisations, Delegations and Procedures, which state that such authorisations can only be given to specific positions with a public sector agency. The Board is currently working with the Department of Environment, Land, Water and Planning (DELWP) (formerly known as the Department of Environment and Primary Industries) as well as the Department of Treasury and Finance to refine its processes to enable the Board to be fully compliant with Procedure (i) of Standing Direction 2.4.

PAGE | 44 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Non-compliance with Standing Direction 4.5.6: Treasury risk management

Standing Direction 4.5.6:Treasury risk management requires all public sector entities to undertake all its borrowings with a financial institution that is either a State owned entity or has a credit rating, assigned by a reputable rating agency, that is the same as or better than the State of Victoria.

During the year ended 31 October 2014, the Board entered into a commercial loan agreement for 12 months for $10,845 plus interest with a financial institution that held a credit rating less than the State of Victoria. This arrangement was to fund a residual payment of a finance lease which expired in June 2014. The Board is currently determining how it will rectify this issue.

Non-compliance with Standing Direction 3.4.1: Revenue and Standing Direction 3.4.2: Cash Handling

Standing Direction 3.4.1: Revenue requires all public sector agencies to implement and maintain an effective internal control framework over revenue transaction processing and management to ensure that revenue is completely and accurately identified, recorded and collected.

Standing Direction 3.4.2: Cash Handling required all public sector agencies to implement and maintain an effective internal control framework over cash handling and banking so that cash from all sources is completely and accurately identified, banked and recorded in the financial records.

During the 2013/14 reporting period, shortfalls in historic cash handling controls and revenue transaction processing came to the attention of the Board, which meant that not all revenue was recorded in an accurate and timely manner in the accounting systems. This resulted in a cash surplus of $96,822 that could not be accurately allocated to specific revenue classifications for financial reporting purposes. The Board has therefore allocated this amount to visitor fees and sale of goods and services on a proportionate basis.

Further, Belgravia assumed the finance function of Mount Baw Baw on 26 May 2014, where the financial information previously managed by Mount Baw Baw was transferred into the accounting system utilised and maintained by Belgravia.

As a result of the transfer of financial information, the Board became aware that Belgravia was unable to reconcile a number of financial transactions between systems or back to source documentation. Subsequent investigation by Belgravia has resolved a majority of these reconciling items. However, there remain a small number of outstanding reconciling items totalling $26,376, contained within “other miscellaneous revenue. b) Basis of preparation

The accrual basis of accounting has been applied in the preparation of these financial statements whereby assets, liabilities, equity, income and expenses are recognised in the reporting period to which they relate, regardless of when cash is received or paid.

In the application of AASs, management is required to make judgments, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical

PAGE | 45 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

experience and various other factors that are believed to be reasonable under the circumstance, the results of which form the basis of making the judgments. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision, and future periods if the revision affects both current and future periods. Judgements and assumptions made by management in the application of AASs that have significant effects on the financial statements and estimates, relate to • the fair value of land, buildings, infrastructure, plant and equipment (refer to Note1(g)); and • superannuation expense (refer to Note 1(k)); and • actual assumptions for employee benefit provisions based on likely tenure of existing staff, patterns of leave claims, future salary movements and future discount rates (refer to Note 1(k)).

Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is reported.

The accounting policies set out below have been applied in preparing the financial report for the year ended 31 October 2014 and the comparative information presented for the year ended 31 October 2013. Restatement occurred. Refer to Note 1(aa).

These financial statements are presented in Australian dollars, and prepared in accordance with the historical cost convention except for non-financial physical assets which, subsequent to acquisition, are measured at a revalued amount being their fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluations are made with sufficient regularity to ensure that the carrying amounts do not materially differ from their fair value.

The financial performance and position of the Board has declined since the prior year, with a deficit net result of $753,003 (2013: $402,646), a net asset position of $17,201,671 (2013: $17,569,014), with a negative working capital and a net cash outflow from operating activities of $9,660. Despite the deterioration of financial performance and position, the Board has obtained a letter of support from the State Government (DELWP), confirming that it will continue to provide the Board adequate cash flow to meet its current and future obligations up to 30 April 2016. On that basis, the financial statements have been prepared on a going concern basis.

Consistent with AASB 13 Fair Value Measurement, the Board determines the policies and procedures for both recurring fair value measurements such as property, infrastructure, plant and equipment in accordance with the requirements of AASB 13 and the relevant Financial Reporting Directions.

All assets for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

PAGE | 46 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

• Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities • Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and • Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For the purpose of fair value disclosures, the Board has determined classes of assets on the basis of the nature, characteristics and risks of the asset and the level of the fair value hierarchy as explained above.

In addition, the Board determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level of input that is significant to the fair valuation measurement as a whole) at the end of each reporting period.

The Valuer-General Victoria (VGV) is the Board’s independent valuation agency. The Board, in conjunction with VGV, monitors changes in the fair value of each asset through relevant data sources to determine whether revaluation is required. c) Reporting entity

The financial statements cover the Board as an individual reporting entity. The Board is an entity established under the Alpine Resorts (Management) Act 1997. Its principal address is:

Mount Baw Baw Alpine Resort Management Board Mount Baw Baw VIC 3833

The Board is a public body acting on behalf of the Crown, and reporting to the Department of Environment, Land, Water and Planning. d) Scope and presentation of financial statements Comprehensive Operating Statement

The Comprehensive Operating Statement comprises three components, being ‘net result from transactions’ (or termed as ‘net operating balance’), ‘other economic flows included in net result’, as well as ‘other economic flows – other comprehensive income’. The sum of the former two represents the net result.

The net result is equivalent to profit or loss derived in accordance with AASs.

This classification is consistent with the whole of government reporting format andis allowed under AASB 101 Presentation of Financial Statements.

Other economic flows are changes arising from market re-measurements. They include gains and losses from disposals, revaluations and impairments of non-financial physical assets.

Balance Sheet

Assets and liabilities are presented in liquidity order with assets aggregated into financial assets and non-financial assets.

PAGE | 47 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Current and non-current assets and liabilities (non-current being those assets or liabilities expected to be recovered or settled beyond 12 months after the reporting period) are disclosed in the notes, where relevant.

Cash Flow Statement

Cash flows are classified according to whether or not they arise from operating, investing, or financing activities. This classification is consistent with requirements under AASB 107 Statement of Cash Flows.

Statement of Changes in Equity

The Statement of Changes in Equity presents reconciliations of each non-owner and owner changes in equity from opening balances at the beginning of the reporting period to the closing balance at the end of the reporting period. It also shows separately changes due to amounts recognised in the “comprehensive result” and amounts related to “transactions with owner in its capacity as owner”.

Rounding of amounts

Amounts in the financial statements (including the notes) have been rounded to the nearest dollar, unless otherwise stated. Figures in the financial statements may not equate exactly due to rounding. e) Changes in accounting policies

Subsequent to the 2012-13 reporting period, the following new and revised Standards have been adopted in the current period with their financial impact detailed below.

AASB 13 Fair Value Measurement

AASB 13 establishes a single source of guidance for all fair value measurements. AASB 13 does not change when the Board is required to use fair value, but rather provides guidance on how to measure fair value under Australian Accounting Standards when fair value is required or permitted. The Board has considered the specific requirements relating to highest and best use, valuation premise and principal (or most advantageous) market. The methods, assumptions, processes and procedures for determining fair value were revisited and no adjustments were made. In light of AASB 13, the Board has reviewed the fair value principles as well as its current valuation methodologies in assessing the fair value, and the assessment has not materially changed the values recognised.

However, AASB 13 has predominately impacted the disclosures of the Board. It requires specific disclosures about fair value measurements and disclosure of fair values, some of which replace existing disclosure requirements in other standards, including AASB 7 Financial Instruments: Disclosures.

The disclosure requirements of AASB 13 apply prospectively and need not be applied in comparative information before first application. Consequently, the 2012-13 comparatives of these disclosures have not been provided.

PAGE | 48 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

AASB 119 Employee Benefits

In 2013-14 the Board has applied AASB 119 Employee Benefits (September 2011, as amended) and the related consequential amendments for the first time.

The revised standard changes the definition of short-term employee benefits. These were previously benefits that were expected to be settled within twelve months after the end of the reporting period in which the employee rendered the related service, however, short- term employee benefits are now defined as benefits expected to be settled wholly within twelve months after the end of the reporting period in which the employees render the related service. This change of accounting policy has been considered by the Board and has not materially altered the measurement of the annual leave provision and therefore it remains at nominal value for both the current and comparative periods. f) Events after reporting date

Assets, liabilities, income and expenses arise from past transactions or other past events. Where the transactions result from an agreement between the Board and other parties, the transactions are only recognised when the agreement is irrevocable at or before balance date. Adjustments are made to amounts recognised in the financial statements for events which occur after the reporting date and before the date the statements are authorised for issue, where those events provide information about conditions which existed at the reporting date. Note disclosure is made about events between the reporting date and the date the statements are authorised for issue where the events relate to condition which arose after the reporting date that may have a material impact on the results of subsequent years. g) Property, infrastructure, plant and equipment

Acquisition

All non-financial physical assets are measured initially at cost and subsequently revalued at fair value less accumulated depreciation and impairment. Where an asset is acquired for no or nominal cost, the cost is its fair value at the date of acquisition. Only assets which have a cost or fair value greater than $1,000 are recognised.

Where assets are constructed by the Board, the cost at which they are recorded includes all materials used in construction, direct labour, borrowing costs incurred during construction, and an appropriate share of directly attributable variable and fixed overheads.

Details about the valuation techniques and inputs used in determining the fair value of non-financial physical assets are discussed in Note 8 Property, infrastructure, plant and equipment.

Repairs & maintenance

Property, infrastructure, plant and equipment maintenance is managed as part of an ongoing maintenance program. The costs of this maintenance are charged as expenses as incurred, except where they related to the replacement of a major component of an asset, in which case the costs are capitalised and depreciated. Other routine operating maintenance, repair costs and minor renewals are also charged as expenses as incurred.

PAGE | 49 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Measurement Non-financial physical assets such as land are measured at fair value with regard to the property’s highest and best use after due consideration is made for any legal or physical restrictions imposed on the asset, public announcements or commitments made in relation to the intended use of the asset. Theoretical opportunities that may be available in relation to the asset are not taken into account until it is virtually certain that the restrictions will no longer apply. Therefore, unless otherwise disclosed, the current use of these nonfinancial physical assets will be their highest and best uses. Revaluations Non-financial physical assets are measured at fair value on a cyclical basis, in accordance with the Financial Reporting Directions (FRDs) issued by the Minister for Finance. A full revaluation normally occurs every five years, based upon the asset’s government purpose classification but may occur more frequently if fair value assessments indicate material changes in values. Independent valuers are generally used to conduct these scheduled revaluations. Certain infrastructure assets are revalued using specialised advisors. Any interim revaluations are determined in accordance with the requirements of the FRDs. Revaluation increases or decreases arise from differences between an asset’s carrying value and fair value. Net revaluation increases (where the carrying amount of a class of assets is increased as a result of a revaluation) are recognised in ‘other economic flows – other comprehensive income’, and accumulated in equity under the asset revaluation surplus. However, the net revaluation increase is recognised in the net result to the extent that it reverses a net revaluation decrease in respect of the same class of property, infrastructure, plant and equipment previously recognised as an expense (other economic flows) in the net result. Net revaluation decrease is recognised in ‘other economic flows – other comprehensive income’ to the extent that a credit balance exists in the asset revaluation surplus in respect of the same class of property, plant and equipment. Otherwise, the net revaluation decreases are recognised immediately as other economic flows in the net result. The net revaluation decrease recognised in ‘other economic flows – other comprehensive income’ reduces the amount accumulated in equity under the asset revaluation surplus. Revaluation increases and revaluation decreases relating to individual assets within an asset class are offset against one another within that class but are not offset in respect of assets in different classes. Asset revaluation surplus is not transferred to accumulated surplus on de-recognition of the relevant asset. Land, building and infrastructure assets were reviewed for material movements according to FRD 103E. A full revaluation of land, buildings and infrastructure assets was undertaken in the 2010/11 year. Interim revaluation of land occurred in 2013-14. Depreciation of non-financial physical assets All infrastructure assets, buildings, plant and equipment (excluding items under operating leases and land) that have finite useful lives are depreciated. Depreciation is generally calculated on a straight line basis, at rates that allocate the asset’s value, less any estimated residual value, over its estimated useful life.

PAGE | 50 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period, and adjustments made where appropriate.

Amendment to accounting policy

In the financial year ended 31 October 2011, the Board underwent a formal revaluation of its property, infrastructure, plant and equipment. This valuation, conducted by the Valuer- General Victoria, highlighted the remaining useful lives of the Board’s asset base. In 2011- 12, management commenced calculating on this basis however the Board did not reflect such changes in its accounting estimates in its 2011-12 financial report and subsequent financial reports as required under AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors.

The following table indicates the actual estimated useful lives used by management but not reflected in financial reports since 2011-12.

2014 2013 (as reported since 2011-12) (years) (years)

Buildings and improvements 9 to 55 15 to 30

Plant and equipment 2 to 20 3 to 20

Land management 4 to 70 5 to 50

Water & sewerage infrastructure 20 to 80 25 to 80

Ski lifts 2 to 30 10 to 40

Buildings and improvements 9 to 55 15 to 30

Sale of non-financial physical assets

In accounting for the sale of physical assets, only the net profit/(loss) on the disposal is shown in the Comprehensive Operating Statement as required under AAS. h) Intangible assets

Intangible assets are initially recognised at cost. Subsequently, intangible assets with finite useful lives are carried at cost less accumulated depreciation. Costs incurred subsequent to initial acquisition are capitalised when it is expected that additional future economic benefits will flow to the Board.

When the recognition criteria in AASB 138 Intangible Assets are met, internally generated intangible assets are recognised and measured at cost less accumulated depreciation.

An internally generated intangible asset arising from development is recognised if, and only if, all of the following are demonstrated:

• the technical feasibility of completing the intangible asset so that it will be available for use or sale; • an intention to complete the intangible asset and use or sell it; • the ability to use or sell the intangible asset;

PAGE | 51 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

• the intangible asset will generate probable future economic benefits; • the availability of adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and • the ability to measure reliably the expenditure attributable to the intangible asset during its development.

Intangible produced assets with finite useful lives are depreciated as an expense from transactions on a straight line basis over the asset’s useful life. Depreciation begins when the asset is available for use, that is, when it is in the location and condition necessary for it to be capable of operating in the manner intended by management.

The typical estimated useful lives for the intangible produced assets of capitalised software development costs for current and prior years are 3 years. i) Impairment of assets

All assets are assessed annually for indications of impairment, except for inventories (refer Note 1(j)).

If there is an indication of impairment, the assets concerned are tested as to whether their carrying value exceeds their possible recoverable amount. Where an asset’s carrying value exceeds its recoverable amount, the difference is written off by a charge to the Comprehensive Operating Statement, except to the extent that the write-down can be debited to a physical asset revaluation surplus amount applicable to that class of asset.

If there is an indication that there has been a reversal in the estimate of an asset’s recoverable amount since the last impairment loss was recognised, the carrying amount shall be increased to its recoverable amount. The impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in prior years.

It is deemed that, in the event of the loss of an asset, the future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made. The recoverable amount for most assets is measured at the higher of depreciated replacement cost and fair value less costs to sell. Recoverable amount for assets held primarily to generate net cash inflows is measured at the higher of the present value of future cash flows expected to be obtained from the asset and fair value less costs to sell. j) Inventories

Inventories comprise goods held for sale and supplies and consumables used in the consumption in the ordinary course of resort operations. Inventories are measured at the lower of cost and net realisable value. Cost is measured on the basis of weighted average cost. k) Employee benefits

Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave and long service leave for services rendered to the reporting date.

PAGE | 52 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(i) Wages and salaries, annual leave and sick leave

Liabilities for wages and salaries, including non-monetary benefits annual leave and accumulating sick leave, are all recognised in the provision for employee benefits as “current liabilities”, because the Board does not have an unconditional right to defer settlements of these liabilities.

Depending on the expectation of the timing of settlement, liabilities for wages and salaries, annual leave and sick leave are measured at:

• Undiscounted value if the Board expects to wholly settle within 12 months; or • Present value if the Board does not expect to wholly settle within 12 months.

(ii) Long service leave

Liability for long service leave (LSL) is recognised in the provision for employee benefits.

Unconditional LSL (representing 7 or more years of continuous service) is disclosed as a current liability, even where the Board does not expect to settle the liability within 12 months because it will not have the unconditional right to defer the settlement of the entitlement should an employee take leave within 12 months.

The components of this current LSL liability are measured at:

• Undiscounted value if the Board expects to wholly settle within 12 months; and • Present value if the Board does not expect to wholly settle within 12 months.

Conditional LSL (representing less than 7 years of continuous service) is disclosed as a non-current liability. There is an unconditional right to defer the settlement of the entitlement until the employee has completed the requisite years of service. This non- current LSL liability is measured at present value.

(iii) Termination benefits

Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Board recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after balance sheet date are discounted to present value.

(iv) Employee benefits on-costs

Employee benefits on-costs (payroll tax, workers compensation, superannuation) are recognised separately from provision for employee benefits. l) Income from transactions

Income is recognised to the extent that it is probable that the economic benefits will flow to the entity and the income can be reliably measured at fair value.

PAGE | 53 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Interest Interest income is recognised using the effective interest method which allocates the interest over the relevant period.

Income from the sale of goods and services Income from the sale of goods is recognised when:

• the Board no longer has any of the significant risks and rewards of ownership of the goods transferred to the buyer; • the Board no longer has continuing managerial involvement to the degree usually associated with ownership, nor effective control over the goods sold; • the amount of income, and the costs incurred or to be incurred in respect of the transactions, can be reliably measured; • it is probable that the economic benefit associated with the transaction will flow to the Board.

Sale of goods and services includes food and beverage and other retail income.

Visitor fees Revenue is recognised at the point of sale, when services are rendered or when a rate/tariff is fixed for service charges levied under Section 13 of the Act. Infringements are issued to guests who do not pay their visitor fees under the Road Safety Act 1986 and the Road Safety (General) Regulations 2009.

Site & service charges Site rental is recognised under the terms and conditions of each lease and in accordance with the Board’s role as a Committee of Management of any Crown land deemed to be permanently reserved under the Crown Lands Reserve Act 1978. Service charges are imposed on an annual basis, and revenue is recognised as income when an invoice is raised by the Board.

Grants Grants from third parties (other than contributions by owners) are recognised as income in the reporting period in which the Board gains control over the underlying assets.

For reciprocal grants (i.e. equal value is given back by the Board to the provider), the Board is deemed to have assumed control when the Board has satisfied its performance obligations under the terms of the grant. For non-reciprocal grants, the Board is deemed to have assumed control when the grant is receivable or received. Conditional grants may be reciprocal or non-reciprocal depending on the terms of the grant.

Grants and contributions for capital works from all sources are recognised as operating revenue when an entitlement is established, and disclosed in the operating statement as government grants. However grants and contributions received from Victorian State Government that are deemed as being in the nature of owner’s contributions, in accordance with FRD 119A Transfers through Contributed Capital are accounted for as Equity – Contributed capital.

PAGE | 54 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

m) Expenses from transactions Expenses are recognised as they are incurred and reported in the financial year to which they relate. Employee expenses These expenses include all costs related to employment (other than superannuation which is accounted for separately) including wages and salaries, fringe benefits tax, leave entitlements, redundancy payments and WorkCover premiums. Superannuation The amount recognised in the Comprehensive Operating Statement in relation to employer contributions is simply the employer contributions that are paid or payable to these plans during the reporting period. Interest expense Interest expense is recognised in the period in which it is incurred and include: • short term borrowings; • finance lease charges.

Other operating expenses Other operating expenses generally represent the day to day running costs incurred in normal operations. Supplies and services Supplies and services expenses are recognised as an expense in the reporting period in which they are incurred. Contractor expenses The Board contracted the management and operation of the resort to Belgravia, a private operator from 1 May 2014 pursuant to the Short Term Management Agreement. The contractor expenses relating to Belgravia, included the management fee payable to that company, and payment for employee benefits by that company, and purchasing goods and services connected to the cost effective operation of the resort. The Board also contracted Lion Capital to act as the Accountable Officer and Lion Capital Advisory Pty Ltd to provide executive assistance to the Board from 1 June 2014. n) Other economic flows included in the net result Other economic flows measure the change in volume or value of assets or liabilities that do not result from transactions. Net gain/(loss) on non-financial assets Net gain/(loss) on non-financial assets and liabilities includes realised and unrealised gains and losses as follows: Revaluation gains/(losses) of non-financial physical assets Refer to Note 1(g) Property, infrastructure, plant and equipment.

PAGE | 55 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Net gain/(loss) on disposal of non-financial assets Any gain or loss on the disposal of non-financial assets is recognised at the date of disposal and is the difference between the proceeds and the carrying value of the asset at the time. o) Cash and cash equivalents Cash and cash equivalents recognised on the Balance Sheet comprise cash on hand and cash at bank, deposits at call and highly liquid investments with an original maturity of three months or less, which are readily convertible to known amounts of cash and are subject to insignificant risk of changes in value. p) Receivables Receivables consist of: • contractual receivables, such as debtors in relation to goods and services and accrued investment income; and • statutory receivables, such as amounts owing from the Victorian Government and Goods and Services Tax (GST) input tax credits recoverable.

Contractual receivables are classified as financial instruments and categorised as receivables at amortised cost. Statutory receivables, are recognised and measured similarly to contractual receivables (except for impairment), but are not classified as financial instruments because they do not arise from a contract. A provision for doubtful receivables is made when there is objective evidence that the debts may not be collected and bad debts are written off when identified. q) Prepayments Prepayments represent payments in advance of receipt of goods or services or that part of expenditure made in one accounting period covering a term extending beyond that period. r) Payables Payables consist of: • contractual payables, such as accounts payable. Accounts payable represent liabilities for goods and services provided to the Board prior to the end of the financial year that are unpaid and arise when the Board becomes obliged to make future payments in respect of the purchase of those goods and services; and • statutory payables, such as goods and services tax and fringe benefits tax payables.

Contractual payables are classified as financial instruments and categorised as financial liabilities at amortised cost. Statutory payables are recognised and measured similarly to contractual payables, but are not classified as financial instruments and not included in the category of financial liabilities at amortised cost, because they do not arise from a contract. s) Interest bearing liabilities Interest bearing liabilities are initially measured at fair value, being the cost of the interest bearing liabilities, net of transaction costs.

PAGE | 56 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Subsequent to initial recognition, interest bearing liabilities are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in net result over the period of the interest bearing liability using the effective interest rate method. t) Finance costs

Finance costs are recognised as expenses in the period in which they are incurred and include: • amortisation of ancillary costs incurred in connection with the arrangement of borrowing; and • finance lease charges; u) Contributed capital

Contributions to the Board are recognised as contributed capital with the approval of the Minister for Finance and when the transfer satisfies the definition of contribution by owners as per FRD 119A Transfers through Contributed Capital. v) Accounting for leases and hire purchases

Finance leases are recognised as assets and liabilities at amounts equal to the fair value of the lease property or, if lower, the present value of the minimum lease payment, each determined at the inception of the lease. The lease asset is depreciated over the shorter of the estimated useful life of the asset or the term of the lease. Minimum lease payments are allocated between the principal component of the lease liability, and the interest expense calculated using the interest rate implicit in the lease, and charged directly to the Comprehensive Operating Statement. Contingent rentals associated with finance leases are recognised as an expense in the period in which they are incurred.

Operating lease payments, including any contingent rentals, are recognised as an expense in the Comprehensive Operating Statement on a straight-line basis over the lease term, except where another systematic basis is more representative of the time pattern of the benefits derived from the use of the leased asset.

Details of finance lease commitments are shown in Note 17. w) Goods and services tax

Income, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the balance sheet.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flow.

PAGE | 57 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

x) Provisions Provisions are recognised when the Board has a present obligation, the future sacrifice of economic benefits is probable, and the amount of the provision can be measured reliably. The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows, using discount rate that reflects the time value of money and risks specific to the provision. When some or all of the economic benefits required to settle a provision are expected to be received from a third party, the receivable is recognised as an asset if it is virtually certain that recovery will be received and the amount of the receivable can be measured reliably. y) Commitments Commitments for future expenditure include operating commitments arising from contracts. These commitments are disclosed by way of a note (refer to Note 17 Commitments) at their nominal value and inclusive of the GST payable. These future expenditures cease to be disclosed as commitments once the related liabilities are recognised in the Balance Sheet. z) Contingent assets and contingent liabilities Contingent assets and contingent liabilities are not recognised in the balance sheet, but are disclosed by way of a note and, if quantifiable, are measured at nominal value. Contingent assets and liabilities are presented inclusive of GST receivable or payable respectively. aa) Adjustment to prior period balances Adjustments to prior period balances and transactions are required as a result of omission and duplication of non-financial physical assets and applying an incorrect estimate of useful life to certain assets. The Board has not prepared a third balance sheet resulting from the below restatement as the impacts are not considered material to the balance sheet to warrant additional disclosure. This is in accordance with AASB 101 Presentation of Financial Statements. The prior period errors led to the following:

2011 & PRIOR 2012 2013 $ $ $ Overstatement of infrastructure, plant and equipment 99,330 93,193 87,056

Total impact on property, infrastructure, plant and equipment 99,330 93,193 87,056

Overstatement/(understatement) of depreciation of plant and (3,604) 6,137 6,137 equipment

Total impact on comprehensive result (3,604) 6,137 6,137

As a result of the above, the following shows a restatement of each line item in the following statements in the financial report.

PAGE | 58 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(i) Comprehensive Operating Statement (extract)

REPORTED 2013 ADJUSTMENT RESTATED 2013 NOTE $ $ $ Total income from transactions 6,980,322 - 6,980,322

Depreciation expense 3 (b) (1,093,059) 6,137 (1,086,922)

Total expense from transactions (7,334,219) 6,137 (7,328,082)

Net result from transactions (353,897) 6,137 (347,760)

Comprehensive result (408,783) 6,137 (402,646)

(ii) Balance Sheet (extract)

GROSS CARRYING AMOUNT OF PROPERTY, INFRASTRUCTURE, PLANT ACCUMULATED NOTE & EQUIPMENT DEPRECIATION TOTAL ASSETS NET ASSETS 8 $ $ $ $ Reported 1 Nov 2010 17,565,468 (3,243,002) 14,669,313 13,737,217 Reported 31 Oct 2011 21,117,560 (1,444,434) 21,623,716 20,307,759 Adjustments for 2011 and prior periods (95,726) (3,604) (99,330) (99,330) Restated 31 Oct 2011 21,021,834 (1,448,038) 21,524,386 20,208,429 Reported 31 Oct 2012 21,202,575 (2,501,034) 19,220,870 17,949,853 Adjustments 2012* (95,726) 2,533 (93,193) (93,193) Restated 31 Oct 2012 21,106,849 (2,498,501) 19,127,677 17,856,660 Reported 31 Oct 2013 21,632,686 (3,594,093) 18,980,906 17,656,070 Adjustments 2013* (95,726) 8,670 (87,056) (87,056) Restated 31 Oct 2013 21,536,960 (3,585,423) 18,893,850 17,569,014

* Adjustment to reported 2013 balances includes cumulative adjustments made in 2011, 2012 and 2013 financial years.

(iii) Statement of Changes in Equity (extract)

ACCUMULATED PHYSICAL ASSET SURPLUS REVALUATION SURPLUS NET EQUITY $ $ $ Reported 1 Nov 2011 2,327,053 6,335,613 13,737,217 Reported 31 Oct 2011 3,452,617 11,546,440 20,307,759 Adjustments for 2011 (3,604) (95,726) (99,330) Restated 31 Oct 2011 3,449,013 11,450,714 20,208,429 Reported 31 Oct 2012 1,094,712 11,546,440 17,949,853 Adjustments for 2012* 2,533 (95,726) (93,193) Restated 31 Oct 2012 1,097,245 11,450,714 17,856,660 Reported 31 Oct 2013 685,928 11,546,440 17,656,070 Adjustments for 2013* 8,670 (95,726) (87,056) Restated 31 Oct 2013 694,598 11,450,714 17,569,014

* Adjustment to reported 2013 Accumulated surplus includes cumulative adjustments applicable to the 2012 and 2013 financial years.

PAGE | 59 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(iv) Restatement of balances in the Notes to the financial statements The notes affected as a result of the above changes are as follows: • Note 3 (b) Depreciation expense • Note 8 Property, infrastructure, plant and equipment • Note 15 Cash flow information

New Accounting Standards for application in future periods Certain new AASs have been published that are not mandatory for the 31 October 2014 reporting period. Department of Treasury and Finance assesses the impact of these new standards and advises of their applicability and early adoption where applicable.

As at 31 October 2014, the standards and interpretations (applicable to departments) in the following table had been issued but were not mandatory for the financial year ended 31 October 2014. The Board has not early adopted these standards.

APPLICABLE FOR STANDARD/ SUMMARY ANNUAL REPORTING IMPACT ON PUBLIC SECTOR ENTITY INTERPRETATION PERIODS BEGINNING ON FINANCIAL STATEMENTS

AASB 9 The preliminary assessment has identified that the financial impact Financial Instruments This standard simplifies of available for sale (AFS) assets requirements for the classification will now be reported through and measurement of financial other comprehensive income assets resulting from Phase 1 (OCI) and no longer recycled to the of the IASB’s project to replace 1 Jan 2017 profit and loss. IAS 39 Financial Instruments: Recognition and Measurement While the preliminary assessment (AASB 139 Financial Instruments: has not identified any material Recognition and Measurement). impact arising from AASB 9, it will continue to be monitored and assessed.

AASB 10 This Standard forms the basis for determining which entities should Consolidated Financial be consolidated into an entity’s Statements financial statements. AASB 10 defines ‘control’ as requiring exposure or rights to variable returns and the ability to affect For the public sector, AASB 10 those returns through power over builds on the control guidance an investee, which may broaden that existed in AASB 127 and the concept of control for public 1 Jan 2014 Interpretation 112 and is not sector entities. expected to change which entities (not-for-profit need to be consolidated. The AASB has issued an entities) Australian Implementation Ongoing work is being done to Guidance for Not-for- Profit monitor and assess the impact of Entities – Control and Structured this standard. Entities that explains and illustrates how the principles in the Standard apply from the perspective of not-for- profit entities in the private and public sectors.

PAGE | 60 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

APPLICABLE FOR STANDARD/ SUMMARY ANNUAL REPORTING IMPACT ON PUBLIC SECTOR ENTITY INTERPRETATION PERIODS BEGINNING ON FINANCIAL STATEMENTS

AASB 11 This Standard deals with the concept of joint control, and Joint Arrangements sets out a new principles-based approach for determining the type of joint arrangement that exists 1 Jan 2014 It is anticipated that there would and the corresponding accounting (not-for-profit be no material impact. treatment. The new categories of entities) joint arrangements under AASB 11 are more aligned to the actual rights and obligations of the parties to the arrangement.

AASB 12 This Standard requires disclosure of information that enables users Disclosure of Interests of financial statements to evaluate in Other Entities the nature of, and risks associated with, interests in other entities 1 Jan 2014 and the effects of those interests It is anticipated that there would on the financial statements. This (not-for-profit be no material impact. Standard replaces the disclosure entities) requirements in AASB 127 Separate Financial Statements and AASB 131 Interests in Joint Ventures.

AASB 127 This revised Standard prescribes the accounting and disclosure Current assessment indicates Separate Financial requirements for investments 1 Jan 2014 that there is limited impact Statements in subsidiaries, joint ventures (not-for-profit on Victorian Public Sector and associates when an entity entities) entities. prepares separate financial statements.

AASB 128 This revised Standard sets out the requirements for the application Current assessment indicates Investments in of the equity method when 1 Jan 2014 that there is limited impact on Associates and Joint accounting for investments in Victorian Public Sector entities. Ventures associates and joint ventures.

AASB 1055 extends the scope of budgetary reporting that is currently applicable for the whole of government and general AASB 1055 This Standard is not applicable as government sector (GGS) to 1 July 2014 no budget disclosure is required. Budgetary Reporting NFP entities within the GGS, provided that these entities present separate budget to the parliament.

In addition to the new standards above, the AASB has issued a list of amending standards that are not effective for the 2013-14 reporting period (as listed below). In general, these amending standards include editorial and references changes that are expected to have insignificant impacts on public sector reporting. The AASB Interpretation in the list below is also not effective for the 2013-14 reporting period and is considered to have insignificant impacts on public sector reporting.

PAGE | 61 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

• AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010). • AASB 2011-7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards. • 2013-1 Amendments to AASB 1049 – Relocation of Budgetary Reporting Requirements. • 2013-3 Amendments to AASB 136 – Recoverable Amount Disclosures for Non- Financial Assets. • 2013-4 Amendments to Australian Accounting Standards – Novation of Derivatives and Continuation of Hedge Accounting. • 2013-5 Amendments to Australian Accounting Standards – Investment Entities • 2013-6 Amendments to AASB 136 arising from Reduced Disclosure Requirements • 2013-7 Amendments to AASB 1038 arising from AASB 10 in relation to consolidation and interests of policy holders • 2013-9 Amendments to Australian Accounting Standards – Conceptual Framework, Materiality and Financial Instruments • AASB Interpretation 21 Levies.

PAGE | 62 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 2: Income from transactions

2014 2013 $ $

Revenue includes:

(a) Interest

Interest on bank deposits 5,400 5,050

Total interest revenue 5,400 5,050

(b) Sale of goods and services (i)

Food and beverage 1,033,490 847,823

Retail sales 121,491 -

Total sale of goods and services 1,154,981 847,823

(c) Government funding

Department of Environment, Land, Water and Planning support payments 3,301,000 4,200,000

Other Government funding 521,099 339,215

Total Government funding 3,822,099 4,539,215

(d) Site & service charges

Annual service charge 363,731 346,395

Site rental 53,740 113,564

Total revenue from site & service charges 417,471 459,959

(e) Visitor fees (i)

Resort entry fees 630,734 301,787

Ski field income 891,334 341,639

Accommodation/guest services 349,367 254,393

Toboggan hire 157,768 13,608

Total revenue from visitor fees 2,029,203 911,427

(f) Other revenue (i)

Marketing 94,764 77,367

Miscellaneous 98,569 34,081

Commission received 102,247 47,384

Staff accommodation 66,169 58,016

Total other revenue 361,749 216,848

(i) Refer to Note 1 (a).

PAGE | 63 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 3: Expenses from transactions

2014 2013 $ $

(a) Employee benefits

Defined contributions superannuation plans 176,014 237,001

Salaries, wages, annual leave and long service leave 1,985,273 2,595,754

Termination benefits 95,482 -

FBT and payroll tax 51,375 136,922

Total employee benefits 2,308,144 2,969,677

(b) Depreciation expense (i)

Buildings 257,317 256,737

Plant and equipment 203,824 259,485

Water and sewerage infrastructure 52,090 52,090

Land management infrastructure 403,740 389,130

Ski lift infrastructure 128,980 129,480

Intangible produced assets 4,917 -

Total depreciation expense 1,050,868 1,086,922

(c) Interest expense

Finance lease interest 29,864 42,344

Finance costs 88 59

Total interest expense 29,952 42,403

(d) Supplies and services

Food & beverage purchases and consumables 583,940 512,959

Consultancy services for EOI Project 412,657 339,944

Accommodation supplies and services 132,157 47,564

Other supplies and services 224,793 194,443

Total supplies and services 1,353,547 1,094,910

(e) Contractor expenses

Resort operations 1,193,404 -

Other operational & administrative support 127,890 -

Total contractor expenses 1,321,294 -

(f) Other operating expenses

Audit fees – Note 23 21,695 22,200

Insurance 164,699 147,153

Repairs and maintenance 204,420 103,741

Gate entry and lift expenses 217,725 268,648

Total other expenses 608,539 541,742

(i) Depreciation expense for the prior period has been restated (refer to Note 1 (aa)).

PAGE | 64 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 4: Other economic flows included in net result

2014 2013 $ $

Net gain/(loss) on disposal of non-financial assets

Net gain/(loss) on disposal of physical asset (1,793) (54,886)

Total gain/(loss) on disposal of non-financial assets (1,793) (54,886)

Note 5: Receivables

2014 2013 $ $

Current receivables

Contractual

Debtors 110,343 155,386

Provision for doubtful debts (3,907) -

Amount owing from the Department of Environment, Land, Water and Planning 850,000 -

Sundry debtors 1,086 1,401

Statutory

GST receivable - 12,146

Total current receivables 957,522 168,933

(a) Movement in the provision for doubtful debts

Opening balance - -

Provision of receivables during the year as uncollectable (3,907) -

Closing balance (3,907) -

Note 6: Inventories

2014 2013 $ $

Current inventories

Supplies & consumables - fuel (at cost) 18,553 17,964

Inventories held for sale (at cost) 62,336 58,991

Total inventories 80,889 76,955

PAGE | 65 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 7: Prepayments

2014 2013 $ $

Current prepayments

Prepaid insurance 103,252 102,505

Prepaid WorkCover premium 4,714 30,512

Total prepayments 107,966 133,017

Note 8: Property, infrastructure, plant and equipment 8a Gross carrying amount and accumulated depreciation (ii)

GROSS CARRYING AMOUNT ACCUMULATED DEPRECIATION NET CARRYING AMOUNT

Non-current 2014 2013 2014 2013 2014 2013 $ $ $ $ $ $

Land at fair value 3,891,660 3,506,000 - - 3,891,660 3,506,000

Buildings at fair value 7,130,486 7,107,759 (770,951) (513,634) 6,359,535 6,594,125

Plant and equipment at fair value 2,970,376 2,908,510 (2,175,772) (1,973,309) 794,604 935,201

Water and sewerage infrastructure at 2,177,200 2,177,200 (156,270) (104,180) 2,020,930 2,073,020 fair value Roads and car parks infrastructure and 3,268,317 3,136,779 (1,151,180) (747,440) 2,117,137 2,389,339 land management at fair value

Ski lift infrastructure at fair value 2,719,842 2,700,712 (375,840) (246,860) 2,344,002 2,453,852 Total property, infrastructure, plant 22,157,881 21,536,960 (4,630,013) (3,585,423) 17,527,868 17,951,537 and equipment

(ii) Property, infrastructure, plant and equipment for the prior period has been restated (refer to Note 1 (aa)). 8b Classification by ‘purpose groups’

All assets in a purpose group are further sub categorized according to the asset’s ‘nature’ (ie buildings, plant and equipment etc.) with each sub category being classified as a separate class of assets for financial reporting purposes.

PAGE | 66 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

8c Movements in carrying amounts

CARRYING REVALUATION CARRYING AMOUNT ADDITIONS DISPOSALS DEPRECIATION AMOUNT - END - START OF (i) EXPENSE YEAR OF YEAR

2014 $ $ $ $ $ $

Land 3,506,000 - - 385,660 - 3,891,660

Buildings 6,594,125 22,727 - - (257,317) 6,359,535

Plant and equipment 935,201 65,020 (1,793) - (203,824) 794,604

Water and sewerage 2,073,020 - - - (52,090) 2,020,930 infrastructure Roads and car parks infrastructure and land 2,389,339 131,538 - - (403,740) 2,117,137 management

Ski lift infrastructure 2,453,852 19,130 - - (128,980) 2,344,002

Total 17,951,537 238,415 (1,793) 385,660 (1,045,951) 17,527,868

2013 $ $ $ $ $ $

Land 3,506,000 - - - - 3,506,000

Buildings 6,846,317 4,545 - - (256,737) 6,594,125

Plant and equipment 1,149,811 167,261 (122,386) - (259,485) 935,201

Water and sewerage 2,125,110 - - - (52,090) 2,073,020 infrastructure Roads and car parks infrastructure and land 2,518,790 259,679 - - (389,130) 2,389,339 management

Ski lift infrastructure 2,462,320 121,012 - - (129,480) 2,453,852

Total 18,608,348 552,497 (122,386) - (1,086,922) 17,951,537

(i) Fair value assessments have been performed for all classes of assets in this purpose group. A managerial revaluation on land was required due to cumulative movements greater than 10% in Land indices published by Valuer-General Victoria. Changes in other assets classes were not material.

PAGE | 67 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

8d Fair value measurement hierarchy for assets as at 31 October 2014

FAIR VALUE MEASUREMENT AT END OF REPORTING CARRYING AMOUNT AS AT PERIOD USING: 31 OCTOBER 2014 LEVEL 1 LEVEL 2 LEVEL 3 $ $ $ $ Land at fair value Specialised land 648,240 - - 648,240 Non-specialised land 3,243,420 - 3,243,420 - Total of land at fair value 3,891,660 - 3,243,420 648,240 Buildings at fair value Specialised buildings 6,345,709 - - 6,345,709 Total of buildings at fair value 6,345,709 - - 6,345,709 Plant and equipment at fair value Plant and equipment 794,604 - - 794,604 Total of plant and equipment at fair value 794,604 - - 794,604 Infrastructure at fair value Water infrastructure 1,503,500 - - 1,503,500 Sewerage infrastructure 517,430 - - 517,430 Roads and car parks infrastructure 1,759,652 - - 1,759,652 Land Management infrastructure 357,485 - - 357,485 Ski Lifts infrastructure 2,344,002 - - 2,344,002 Total of infrastructure at fair value 6,482,069 - - 6,482,069

There have been no transfers between levels during the period.

Specialised land and specialised buildings Specialised land is valued using the market approach, adjusted for the community service obligation (CSO) to reflect the specialised nature of the land being valued. Under the market approach to valuation, the assets are compared to recent comparable sales or sales of comparable assets, which are considered to have nominal or no added improvement value. The valuation of such assets is performed by analysing comparable sales and allowing for share, size, topography, location and other relevant factors specific to the asset being valued. The CSO adjustment is a reflection of the value’s assessment of the impact of restrictions associated with an asset to the extent that it is also equally attributable to market participants. This approach is in light of the highest and best use consideration required for fair value measurement, and takes into account the use of the asset that is physically possible, legally permissible and financially feasible. As adjustments of CSO are considered as significant unobservable inputs specialised land would be classified as level 3 assets. Specialised buildings are valued using the depreciated replacement cost method, adjusting for the associated depreciations. As depreciation adjustments are unobservable in nature, specialised buildings are classified as Level 3 fair value measurements.

PAGE | 68 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

An independent valuation of specialised land and buildings was performed by the VGV. The effective date of the valuation is 31 October 2011.

Fair value assessment is conducted each year. The Board considered the movement in indices provided by the VGV in order to determine whether any material movements in value have occurred since this date. A cumulative movement of 11% in land indices since October 2011 triggered a managerial revaluation of land value. No material movements in value were observed for buildings and the Board are comfortable that the values stated in these financial statements approximate fair value.

Non-specialised land For non-specialised land, an independent valuation was performed by the VGV to determine the fair value using the income approach. Valuation of the assets was determined by adopting the site value for each leased site then calculating the present value of the income combined with the reversion value of the site at the expiration of the current site lease term. The effective date of the valuation is 31 October 2011.

To the extent that non-specialised land does not contain significant, unobservable adjustments, these assets are classified as Level 2. Non-specialised land was also subject to revaluation due to material movement in land indices.

Fair value assessment is conducted each year. The Board considered the movement in indices provided by the VGV in order to determine whether any material movements in value have occurred since this date. A cumulative movement of 11% in land indices since October 2011 triggered a managerial revaluation of land value. No material movements in value were observed for buildings and the Board are comfortable that the values stated in these financial statements approximate fair value.

Infrastructure Infrastructure assets, including land management infrastructure, are valued using the depreciated replacement cost method. This cost represents the replacement cost of the building/component after applying depreciation rates on a useful life basis. Replacement costs relate to costs to replace the current service capacity of the asset. Economic obsolescence has also been factored into the depreciated replacement cost calculation.

An independent valuation of the Board’s infrastructure assets was performed by the VGV. The valuation was performed based on the depreciated replacement costs of the assets. The effective date of the valuation is 31 October 2011.

The Board assesses the fair value of its infrastructure assets annually by considering the movement in the Output Price Index of Construction Industries and the Producer Price Index published by the Australian Bureau of Statistics in order to determine whether any material movements in value have occurred since the last valuation date and is comfortable that the values stated in these financial statements approximate fair value.

Plant and equipment Plant and equipment is held at fair value. When plant and equipment is specialised in use, such that it is rarely sold other than as part of a going concern, fair value is determined using the depreciated cost method.

There were no changes in valuation techniques throughout the period to 31 October 2014.

PAGE | 69 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

For assets measured at fair value, the current use is considered the highest and best use. 8e Reconciliation of Level 3 fair value

LAND ROADS & SPECIALISED SPECIALISED PLANT & WATER SEWERAGE MANAGEMENT CAR PARKS SKI LIFT LAND BUILDINGS EQUIPMENT INFRA- INFRA- INFRA- INFRA- INFRA- STRUCTURE STRUCTURE STRUCTURE STRUCTURE STRUCTURE

2014 $ $ $ $ $ $ $ $

Opening 584,000 6,586,225 935,201 1,541,400 531,620 351,579 2,037,760 2,453,852 balance

Purchases - 22,727 65,020 - - 43,836 87,702 19,130

Disposals - - (1,793) - - - - -

Transfers in (out) of ------Level 3

Depreciation - (257,317) (203,824) (37,900) (14,190) (37,930) (365,810) (128,980)

Impairment ------loss

Subtotal 584,000 6,351,635 794,604 1,503,500 517,430 357,485 1,759,652 2,344,002

Revaluation 64,240 ------

Closing 648,240 6,351,635 794,604 1,503,500 517,430 357,485 1,759,652 2,344,002 balance

PAGE | 70 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

8f Description of significant unobservable inputs to Level 3 valuations

SIGNIFICANT VALUATION UNOBSERVABLE RANGE (WEIGHTED SENSITIVITY OF FAIR VALUE MEASUREMENT TO TECHNIQUE INPUTS AVERAGE) CHANGES IN SIGNIFICANT UNOBSERVABLE INPUTS

Community A significant increase or decrease in the CSO Market Specialised land Service Obligation 20% adjustment would result in a significantly approach (CSO) adjustment lower (higher) fair value A significant increase or decrease in Depreciated Specialised Replacement cost $1,700 – $3,600 / replacement cost per square metre replacement buildings per square metre m2 ($3,205) adjustment would result in a significantly cost higher or lower fair value Useful life of A significant increase or decrease in the 10 – 60 years specialised estimated useful life of the asset would result (55 years) buildings in a significantly higher or lower valuation Depreciated A significant increase or decrease in cost per Plant and $1,006 - $297,102 replacement Cost per unit unit would result in a significantly higher or equipment ($8,030) cost lower fair value Useful life A significant increase or decrease in the 2 - 20 years of plant and estimated useful life of the asset would result (5 years) equipment in a significantly higher or lower valuation Depreciated A significant increase or decrease in cost per Infrastructure – $33,000 - $413,600 replacement Cost per unit unit would result in a significantly higher or Water ($147,018) cost lower fair value A significant increase or decrease in the Useful life of the 25 - 60 years estimated useful life of the asset would result infrastructure (53 years) in a significantly higher or lower valuation Depreciated A significant increase or decrease in cost per Infrastructure – $5,900 - $396,000 replacement Cost per unit unit would result in a significantly higher or Sewerage ($93,333) cost lower fair value A significant increase or decrease in the Useful life of the 30 - 80 years estimated useful life of the asset would result infrastructure (48 years) in a significantly higher or lower valuation Infrastructure Depreciated A significant increase or decrease in cost per $1,500 - $132,000 – Land replacement Cost per unit unit would result in a significantly higher or ($23,868) management cost lower fair value A significant increase or decrease in the Useful life of the 5 - 80 years estimated useful life of the asset would result infrastructure (26 years) in a significantly higher or lower valuation Infrastructure Depreciated A significant increase or decrease in cost per $40,700 - $772,800 – Roads and car replacement Cost per unit unit would result in a significantly higher or ($216,526) parks cost lower fair value A significant increase or decrease in the Useful life of the 9 - 40 years estimated useful life of the asset would result infrastructure (23 years) in a significantly higher or lower valuation Depreciated A significant increase or decrease in cost per Infrastructure – $400 - $547,500 replacement Cost per unit unit would result in a significantly higher or Ski lift ($88,295) cost lower fair value A significant increase or decrease in the Useful life of the 10 - 40 years estimated useful life of the asset would result infrastructure (20 years) in a significantly higher or lower valuation

PAGE | 71 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 9: Intangible assets

TOTAL

2014 2013 Gross carrying amount $ $

Opening balance - -

Additions from internal development – computer software 28,818 -

Closing balance 28,818 -

Accumulated depreciation (i)

Depreciation of intangible produced assets (4,917) -

Closing balance (4,917) -

Net book value at end of financial year 23,901 -

(i) The consumption of produced intangible assets is included in ‘depreciation’ line item on the Comprehensive Operating Statement.

Significant intangible assets The Board has capitalised software development expenditure for the development of its Snowcore software. The carrying amount of the capitalised software development expenditure is $23,901. Its useful life is 3 years and will be fully amortised in 2017. Note 10: Payables

Current 2014 2013 $ $

Contractual

Creditors 799,376 301,646

Accruals 211,724 174,282

Total contractual payables 1,011,100 475,928

Statutory

PAYG-withholding payable 18,090 30,467

Superannuation payable 17,353 22,151

GST payable 10,880 -

Payroll tax payable 20,537 -

Total statutory payables 66,860 52,618

Total payables 1,077,960 528,546

PAGE | 72 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 11: Interest bearing liabilities

2014 2013 NOTE $ $

Current

(i) Net finance lease liability 17 121,663 161,678

(ii) Borrowings 6,425 -

Total current borrowings 128,088 161,678

Non-current

(i) Net finance lease liability 17 142,345 270,132

Total non-current borrowings 142,345 270,132

Total interest bearing liabilities 270,433 431,810

(i) Secured by the assets leased. Finance leases are effectively secured as the rights to the leased assets revert to the lessor in the event of default. (ii) Loan agreement on residual payment for an expired finance lease.

PAGE | 73 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 12: Provisions

2014 2013 $ $

Current Employee benefits Annual Leave Unconditional and expected to be wholly settled within 12 months 140,009 227,540 Long Service Leave Unconditional and expected to be settled after 12 months 12,004 16,408 Total current employee benefits 152,013 243,948 Provisions related to employee benefits on-costs Annual Leave Unconditional and expected to be wholly settled within 12 months 21,492 38,682 Long Service Leave Unconditional and expected to be settled after 12 months 9,246 2,789 Total current employee benefits on-costs 30,738 41,471 Total current provisions 182,751 285,419 Non-current Employee benefits 50,564 11,076 Provisions related to employee benefit on-costs 2,134 1,883 Total non-current provisions 52,698 12,959 Total provisions 235,449 298,378 (a) Employee benefits and related on-costs Current employee benefits Annual leave entitlements (including leave loading) 119,627 187,462 Time in Lieu entitlements 20,383 40,079 Unconditional long service leave entitlements 12,004 16,408 Non-current employee benefits Conditional long service leave entitlements 50,564 11,076 Total employee benefits 202,578 255,024 Current on-costs 30,737 41,471 Non-current on-costs 2,134 1,883 Total on-costs 32,871 43,354 Total employee benefits and related on-costs 235,449 298,378 (b) Movement in provisions (on-costs) Opening balance 43,354 Additional provisions recognised 25,407 Reductions arising from payments/other sacrifices of future economic benefits (35,938) Effect of change in discount rates 48 Closing balance 32,871 Current 29,268 Non-current 3,603 32,871

PAGE | 74 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 13: Payables

2014 2013 $ $

Current

Lease revenue received in advance 8,333 8,333

8,333 8,333

Non-current

Lease revenue received in advance 49,437 57,769

49,437 57,769

Total revenue in advance 57,770 66,102

Note 14: Contributed capital

The equity from the Alpine Resorts was allocated during 1998 by the Minister for Conservation and Land Management pursuant to section 59 of the Alpine Resorts (Management) Act 1997. The allocation received from the Alpine Resorts Commission included revenue and capital items. An amount of $4,066,078 represents the capital portion of the contribution received form the Alpine Resorts Commission as at 30 April 1998. This amount is included in the total contributed capital at 31 October 2014 of $5,423,702. Equity and movements in equity are summarised in the Statement of Changes in Equity. Pursuant to Financial Reporting Direction No 2A (FRD 119A Transfers through Contributed Capital) under the Financial Management Act 1994, the Board did not receive any contributed capital from DELWP during the reporting period (2013: $115,000).

PAGE | 75 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 15: Cash flow information

2014 2013 Reconciliation of results to net cash inflow/(outflow) from operating activities $ $

Net result (753,003) (402,646)

Non-cash movements

Depreciation 1,050,868 1,086,922

Loss/(gain) on disposal of non-financial physical assets 1,793 54,886

Other non-cash movements (20,000) -

Movements in assets and liabilities

Decrease/(Increase) in receivables (788,589) (59,091)

Decrease/(Increase) in inventories (3,934) (12,686)

Decrease/(Increase) in prepayments 25,051 (42,117)

Increase/(Decrease) in payables 549,414 149,178

Increase/(Decrease) in provisions (62,929) 4,982

Increase/(Decrease) in revenue received in advance (8,332) (8,333)

Net cash inflow/(outflow) from operating activities (9,661) 771,095

(i) Comprehensive result for the prior period has been restated (refer to Note 1 (aa)). Note 16: Cash and cash equivalents

Current 2014 2013 $ $

Cash at year end, as shown in the Cash Flow Statement, is reconciled to the Balance Sheet as follows:

Cash held for Alpine Risk Mitigation Program 99,790 95,000

Operational funds 45,347 468,408

49,437 57,769

Total cash and cash equivalents 145,137 563,408

PAGE | 76 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 17: Commitments

2014 2013 $ $ Revenue Operating leases – Crown Land For operating leases that are non-cancellable leases, the minimum lease payments are expected within the following periods: - Not later than one year 31,322 39,165 - Later that one year but not later than five years 115,392 121,216 - Later than five years 373,516 399,014 520,230 559,395 2013 lease revenue receivable has been revised as the previously reported amount ($842,239) was overstated by $282,483 resulting from incorrect lease expiry dates being used in the calculations. This restatement has no impact on the Board’s comprehensive result and financial position. Leasing powers are defined in Section 7 of the Alpine Resorts (Management) Act 1997. Lease terms of up to 99 years are permissible under this section. The Board also has the power to grant leases up to 21 years as a Committee of Management under the Crown Land (Reserves) Act 1978. New leases are granted on the basis that the rental will be negotiated at market value. All renewal of leases and/or variations of leases will be granted on the basis that the rental will be negotiated at market value.

Lease receivables New leases The site holder shall pay to the Board by either of the following methods: (a) Payment of the site value of the land as determined by valuation at the time of the execution of the lease as a single up-front payment; or (b) An initial payment of the site holders interest (determined by valuation) and an ongoing annual market rent (determined by valuation) for the term of the lease. Existing leases Rental of a lease shall be achieved by payment of market rent (determined by valuation) for the term of the lease. Lease payables Operating leases Commitments in relation to non-cancellable operating leases contracted for at the reporting date but not recognised in the financial report as liabilities, payable: - Not later than one year 22,704 22,704 - Later that one year but not later than five years 22,704 45,408 Total 45,408 68,112 Finance leases (i) Commitments in relation to finance leases are payable as follows: - Not later than one year 139,741 192,153 - Later that one year but not later than five years 155,347 301,901 Minimum Lease payments 295,088 494,054 Less: Future finance charges (31,080) (62,244) Total 264,008 431,810 Representing finance lease liabilities: Current 121,663 161,678 Non-current 142,345 270,132 Total 264,008 431,810 Commitment to expenditure (ii) Contractor fees - Not later than one year 208,000 - Total 208,000 -

(i) Finance leases for equipment and motor vehicles (ii) Fees payable to commercial contractors

PAGE | 77 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 18: Superannuation

Superannuation contributions for the reporting period are included as part of the employee benefits in the Comprehensive Operating Statement.

The name and details of the employee defined contribution plans and contributions made by the Board are as follows:

CONTRIBUTION OUTSTANDING AT CONTRIBUTION RATE PAID CONTRIBUTION FOR THE YEAR YEAR END

Name of fund 2014 2014 2013 2014 2013 % $ $ $ $

AMP Life 9.25 - 9.5 9,955 9,499 666 811 ANZ Bank 9.25 - 9.5 5,912 2,348 985 448 Assante Super Service 9.25 - 9.5 15,783 - 1,362 7,563 Australian Super 9.25 - 9.5 20,803 26,574 2,777 1,690 BT Super for Life 9.25 - 9.5 10,286 18,863 421 895 CARE Super 9.25 - 9.5 2,762 - 140 - Cbus 9.25 - 9.5 4,749 7,471 273 465 CLUB PLUS 9.25 - 9.5 4,662 1,336 338 331 Colonial Super 9.25 - 9.5 4,382 10,554 309 1,192 First Super 9.25 - 9.5 3,469 3,905 123 177 HESTA 9.25 - 9.5 297 2,216 - - HostPlus Super 9.25 - 9.5 21,443 34,189 1,420 1,840 LUCRF 9.25 - 9.5 - 1,324 - - REST Super 9.25 - 9.5 5,738 9,852 152 445 SunSuper 9.25 - 9.5 5,154 5,664 249 498 SuperWrap 9.25 - 9.5 2,094 1,599 222 135 Tasplan 9.25 - 9.5 1,964 3,897 - 386 Telstra Super 9.25 - 9.5 5,094 5,099 876 375 VicSuper 9.25 - 9.5 47,467 85,192 5,818 4,431 Vision Super 9.25 - 9.5 - 2,347 - - Other 9.25 - 9.5 4,000 4,465 1,222 469 Total 9.25 - 9.5 176,014 236,394 17,353 22,151

The requirements of the Superannuation Industry (Supervision) Act 1993 are fully complied with. Rate of Superannuation Contribution Guarantee increased from 9.25% to 9.50% effective July 2014. Note 19: Contingent assets and liabilities At balance date the Board had no contingent assets or liabilities. (2013: $nil). Note 20: Capital commitments At balance date the Board had no capital commitments. (2013: $nil).

PAGE | 78 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 21: Responsible persons related disclosures (a) Responsible persons

The names of the persons who were responsible persons at any time during the financial year are: FROM TO

Responsible Minister

The Hon. Ryan James Smith MP, Minister for Environment & Climate Change 1 Nov 2013 31 Oct 2014

Board Members

Ms Vicky Papachristos (Chairperson) 1 Nov 2013 31 Oct 2014

Mr Randall Cohen (Deputy Chair) 1 Nov 2013 31 Oct 2014

Mr Wally Tabensky 1 Nov 2013 27 Oct 2014

Ms Jacqueline McLeod 1 Nov 2013 27 Oct 2014

Mr Benjamin Dunlop 1 Nov 2013 31 Oct 2014

Accountable Officers

Mr Stuart Ord – AO/CEO 1 Nov 2013 24 Aug 2014

Mr Craig Jensz – AO/CFAO 1 Jun 2014 31 Oct 2014

(b) Remuneration

The number of Responsible Persons whose remuneration from the Board was within the specified bands are as follows: 2014 2013

$0 to $9,999 3 6

$10,000 to $19,999 3 -

$200,000 to $209,999 - 1

$220,000 to $229,999 1 -

Total 7 7

$ $ The remuneration received or due and receivable by the responsible persons in connection 285,638 249,928 with the management of the resort during the reporting period was: The relevant amounts relating to the Minister are reported separately in the Department of Premier and Cabinet’s Financial Statements.

PAGE | 79 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(c) Executive remuneration

There were 2 executive officers whose remuneration, including termination payments, from the Board exceeded $100,000. This excludes the remuneration of the Accountable Officers in Note 21(b). TOTAL REMUNERATION BASE REMUNERATION 2014 2013 2014 2013

Income band No. No. No. No.

$110,000 to $119,999 - 1 2 1

$120,000 to $129,999 2 1 - 1

Total 2 2 2 2

Annualised employee equivalent 2 2 2 2

Total remuneration $247,381 $245,586 $226,288 $245,586

(i) Annualised full time equivalent is based on paid working hours of 38 ordinary hours per week over 52 weeks for a reporting period. (d) Other transactions

The number of contractors charged with significant management responsibilities is disclosed within the $10,000 expense band. These contractors are responsible for planning, directing, controlling, and/or reporting upon, whether directly or indirectly, a significant proportion of the Board’s activities TOTAL EXPENSES (GST-exclusive) 2014 2013 $120,000 to $129,999 1 -

$1,190,000 to $1,199,999 1 -

Total 2 -

Total amount $1,321,294 -

PAGE | 80 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 22: Financial instruments The Board’s principal financial instruments comprise; • Cash and cash equivalents; • Receivables (excluding statutory receivables); • Payables (excluding statutory payables); and • Borrowings. 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 and financial liability above are disclosed in Note 1 to the financial statements. The main purpose in holding financial instruments is to prudently manage the Board’s financial operations. The carrying amounts of the Board’s contractual financial assets and liabilities by category are in the table below.

2014 2013 NOTE CATEGORY $ $

Contractual financial assets

Cash and deposits 16 Cash and cash equivalents 145,137 563,408

Receivables:

Debtors 5 Receivables at amortised cost 956,436 155,386

Sundry debtors 5 Receivables at amortised cost 1,086 1,401

Total contractual financial assets 1,102,659 720,195

Contractual financial liabilities

Payables:

Financial liabilities at Creditors 10 799,376 301,646 amortised cost

Borrowings:

Financial liabilities at Finance lease liabilities 11 264,008 431,810 amortised cost Financial liabilities at Loans 11 6,425 - amortised cost Total contractual financial liabilities 1,069,809 733,456

(i) The total amounts disclosed here exclude statutory amounts (e.g. amounts owing from the Victorian Government and GST input tax credits recoverable, and taxes payable).

PAGE | 81 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Net holding gain/(loss) on financial instruments by category

2014 2013 $ $

Contractual financial assets

Financial assets – cash and cash equivalents

Interest on cash and deposits 5,400 5,050

Financial assets – receivables

Impairment loss (3,907) -

Total contractual financial assets 1,493 5,050

Contractual financial liabilities

Financial liabilities at amortised cost:

Interest on finance lease liabilities 29,864 42,344

Total contractual financial liabilities 29,864 42,344

(a) Credit risk exposure Credit risk arises from the contractual financial assets of the Board, which comprise cash and cash equivalents and receivables. The Board’s exposure to credit risk arises from the potential default of counter party on their contractual obligations resulting in financial loss to the Board. Credit risk is measured at fair value and is monitored on a regular basis. As at the reporting date, there is no event to indicate that any of the financial assets were 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 contractual financial assets that are past due but not impaired:

PAST DUE BUT NOT IMPAIRED CARRYING NOT PAST DUE AND NOT AMOUNT IMPAIRED LESS THAN 1 3 MONTHS MONTH 1-3 MONTHS - 1 YEAR 1-5 YEARS $ $ $ $ $ $ 2014 Receivables:

Debtors 956,436 862,769 768 5,108 87,791 -

Sundry debtors 1,086 - - - 1,086 -

Total 957,522 862,769 768 5,108 88,877 -

2013 Receivables:

Debtors 155,386 56,565 40,108 23,470 35,243 -

Sundry debtors 1,401 - - - 1,401 -

Total 156,787 56,565 40,108 23,470 36,644 -

PAGE | 82 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(b) Liquidity risk Liquidity risk arises when the Board is unable to meet its financial obligations as they fall due. The Board operates under the Government fair policy of settling financial obligations within 30 days and in the event of a dispute, will make payment within 30 days from the date of resolution. The Board’s maximum exposure to liquidity risk is the carrying amounts of financial liabilities as disclosed in the face of the balance sheet. The Board manages its liquidity risk by close monitoring of its financial liabilities based on forecasts of future cash flows. As indicated in Note 24, the Board is dependent on the Victorian State government to ensure it can meet its obligations as and when they fall due. In this respect, the Board works closely with Department of Environment, Land, Water and Planning to ensure support payments are received in a timely manner for it to meet its financial obligations. The following table discloses the contractual maturity analysis for the Board’s contractual financial liabilities.

MATURITY DATES CARRYING NOMINAL AMOUNT AMOUNT LESS THAN 1 3 MONTHS MONTH 1-3 MONTHS - 1 YEAR 1-5 YEARS $ $ $ $ $ $ 2014 Payables:

Creditors 799,376 799,376 482,873 315,278 1,225 -

Total 957,522 862,769 768 5,108 88,877 -

2014 Borrowings:

Finance lease liabilities 264,008 264,008 10,320 31,420 81,733 140,535

Loans 6,425 6,425 890 2,725 2,810 -

Total 1,069,809 1,069,809 494,083 349,423 85,768 140,535

2013 Payables:

Creditors 301,646 301,646 210,981 90,665 - -

Total 957,522 862,769 768 5,108 88,877 -

2013 Borrowings:

Finance lease liabilities 431,810 431,810 13,473 26,946 121,259 270,132

Total 733,456 733,456 224,454 117,611 121,259 270,132

PAGE | 83 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(c) Market risk The Board’s exposure to market risk is limited with almost no exposure to foreign currency or other price risks. Interest rate risk Exposure to interest rate risk is insignificant and might arise primarily through the Board’s cash and deposits and finance lease liabilities. Minimisation of risk is achieved by mainly undertaking fixed rate or non-interest bearing financial instruments. Financial liabilities comprise of finance leases at fixed interest rates. The table below reflects the Board’s interest rate exposure on financial instruments.

WEIGHTED INTEREST RATE EXPOSURE CARRYING AVERAGE AMOUNT VARIABLE NON-INTEREST INTEREST RATE FIXED INTEREST INTEREST RATE BEARING % $ $ $ $ 2014 Contractual financial assets Financial assets Cash and deposits 1.4% 145,137 - 99,790 45,347 Debtors 957,522 - - 957,522 Total financial assets 1,102,659 - 99,790 1,002,869 Financial liabilities Creditors 799,376 - - 799,376 Finance lease liabilities 8.2% 264,008 264,008 - - Loans 13.5% 6,425 6,425 - - Total financial liabilities 1,069,809 270,433 - 799,376 2013 Contractual financial assets Financial assets Cash and deposits 1.8% 563,408 - 95,000 468,408 Debtors 156,787 - - 156,787 Total financial assets 720,195 - 95,000 625,195 Financial liabilities Creditors 301,646 - - 301,646 Finance lease liabilities 8.6% 431,810 431,810 - - Total financial liabilities 733,456 431,810 - 301,646

Sensitivity disclosure analysis and assumptions The Board’s sensitivity to market risk is determined based on the observed range of actual historical data for the preceding five year period, with all variables other than the primary risk variable held constant. The Board cannot be expected to predict movements in market rates and prices. Sensitivity analyses shown are for illustrative purposes only. A movement of 100 basis points up and down (2013: 100 basis points up and down) in market interest rates (AUD) is ‘reasonably possible’ over the next 12 months. The following table shows the impact on the Board’s net result and equity for each category of financial instrument held by the Board at the end of the reporting period as presented to key management personnel, if the above movement were to occur.

PAGE | 84 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

(d) Interest rate risk

INTEREST RATE EXPOSURE CARRYING AMOUNT -1% +1% NET RESULT EQUITY NET RESULT EQUITY $ $ $ $ $ 2014 Financial assets

Cash 99,790 (998) (998) 998 998

2014 Financial liabilities

Total 99,790 (998) (998) 998 998

2013 Payables:

Creditors 301,646 210,981 90,665 - -

Total 957,522 768 5,108 88,877 -

2013 Financial assets

Cash 95,000 (950) (950) 950 950

2013 Financial liabilities

Total 95,000 (950) (950) 950 950

(d) Fair value

The carrying amounts of financial assets and financial liabilities recognised at the balance date, consisting of cash, receivable, payables, finance lease liabilities and borrowings, represent fair value because of the short-term nature of the financial instruments and the expectation that they will be paid in full. Note 23: Remuneration of auditors

2014 2013 $ $

Audit fees paid or payable to the Victorian Auditor General’s Office for the audit of the 21,695 22,200 Board’s financial reports. Note 24: Economic dependency The Board is dependent on the continued financial support of the State Government and in particular, the DELWP which has confirmed that it will continue to provide the Board adequate cash flow support to meet its current and future obligations as and when they fall due for a period up to 30 April 2016. Accordingly these financial statements have been prepared on a going concern basis. Note 25: Ex-gratia expenses There was no ex-gratia payments made during the 2013/14 financial year (2012/13: $nil).

PAGE | 85 NOTES TO THE FINANCIAL STATEMENTS For the year ended 31 October 2014

Note 26: Events occurring after reporting date The Victorian State election was held 29 November 2014. Consequently new Minister For Environment, Climate Change and Water, the Honourable Lisa Mary Neville MP, was appointed by the Governor of the State of Victoria on 4 December 2014. The Governor in Council also made an order on the same date, under section 10 of the Public Administration Act 2004, to change the name of the portfolio department that Mt Baw Baw Alpine Resort Management Board fall under, from the Department of Environment and Primary Industries to the Department of Environment, Land, Water and Planning (DELWP). $850,000 of operational funding that related to the 2014 financial year was subsequently received from DELWP after balance date, resulting in the higher than normal creditors balances at 31 October 2014. Financial obligations in excess of 30 days were paid once funding was received in November 2014.

PAGE | 86 DISCLOSURE INDEX

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

PAGE LEGISLATION REQUIREMENT REFERENCE MINISTERIAL DIRECTIONS

Report of operations

Charter and purpose

FRD 22E Manner of establishment and the relevant Ministers 5

FRD 22E Objectives, functions, powers and duties 22

FRD 22E Nature and range of services provided 27

Financial information

FRD 22E Operational and budgetary objectives 8-12

FRD 22E Summary of financial results 13-14

FRD 22E Major changes or factors affecting performance 13-14

FRD 22E Subsequent events 13

FRD 22E Significant changes in financial position during the year 13

SD4.2(a) Statement of changes in equity 42

SD4.2(b) Operating statement 40

SD4.2(b) Balance sheet 41

SD4.2(b) Cash flow statement 43

SD4.2(c) Accountable Officer’s declaration 1

Governance and organisational structure

FRD 22E Organisational structure 21

FRD 22E Occupational health and safety policy 10, 28

FRD 22E Employment and conduct principles 28

FRD 29 Workforce Data disclosures 28, 29

FRD 15B Executive officer disclosures 30, 31 OTHER INFORMATION FRD 10 Disclosure index 87, 88

FRD 22E Details of consultancies in excess $10,000 31, 32

FRD 22E Details of consultancies under $10,000 32

PAGE | 87 DISCLOSURE INDEX continued

PAGE LEGISLATION REQUIREMENT REFERENCE OTHER INFORMATION FRD 12A Disclosure of major contracts 32

FRD 22E Application and operation of Freedom of Information Act 1982 32

FRD 22E Compliance with building and maintenance provisions of Building Act 1993 33

FRD 22E Statement on National Competition Policy 33

FRD 22E Application and operation of the Protected Disclosures Act 2012 33

FRD 22E Statement of availability of other information 35

SD 4.5.5 Risk management compliance attestation 36

FRD 22E Summary of environmental performance 35

FRD 25B Victorian Industry Participation Policy disclosures 31

FRD 22E Disclosure of government advertising expenditure 13

MRO Compliance with VicData access policy 34

PC2012/02 Gifts, benefits and hospitality attestation 36

SD 4.5.5.1 Insurance attestation 36

SD 4.2(g) Entire General information requirements document

Alpine Resorts (Management) Act 1997 5, 22, 23

Freedom of Information Act 1982 32, 35

Building Act 1993 33 LEGISLATION Protected Disclosure Act 2012 33, 34

Victorian Industry Participation Policy Act 2003 31

Financial Management Act 1994 37

PAGE | 88 PAGE | 89 CONTACT INFORMATION Mt Baw Baw Alpine Resort T. 03 5165 1136 Management Board F. 03 5165 1125 PO Box 117, Rawson VIC E. [email protected] www.mountbawbaw.com.au