Consolidated Entity Annual Financial Report 2020
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CONSOLIDATED ENTITY ANNUAL FINANCIAL REPORT 2020 INDEX TO THE FINANCIAL STATEMENTS EDMUND RICE EDUCATION AUSTRALIA Consolidated Entity Financial Statements Year Ended 31 December 2020 Statement of Profit or Loss and Other Comprehensive Income 3 Statement of Financial Position 4 Statement of Changes in Equity 5 Statement of Cash Flows 6 Notes to the Financial Statements 1 Significant Events in the Accounting Period 7 2 Critical Accounting Estimates and Judgements 8 3 Revenue and Other Income 9 4 Expenses 11 5 Trade and Other Receivables 12 6 Financial Assets 13 7 Property, Plant and Equipment 14 8 Trade and Other Payables 16 9 Financial Liabilities 16 10 Provisions 17 11 Other Liabilities 18 12 Inventories 18 13 Other Assets 18 14 Intangible Assets 19 15 Reserves 19 16 Notes to the Consolidated Statement of Cash Flows 20 Risk 17 Financial Risk Management 21 Group Structure 18 Parent Entity Financial Information 22 Unrecognised Items 19 Enforceable Undertaking 23 20 Contingent Liabilities and Assets 23 21 Capital and Operating Lease Commitments 23 22 Subsequent Events 24 Other Information 23 Related Party Transactions 24 24 General Information 25 25 Summary of Significant Accounting Policies 27 Statement by the Management of Edmund Rice Education Australia 30 Statement by the Board of Edmund Rice Education Australia 31 Statement by the Council of Edmund Rice Education Australia 32 Independent Auditor’s Report 33 Auditors Independent Declaration 34 The Trustees of Edmund Rice Education Australia Consolidated Entity Statement of Profit or Loss and Other Comprehensive Income For the year ended 31 December 2020 2020 2019 Notes $ $ REVENUE AND INCOME Revenue from ordinary activities 3 928,256,757 906,960,837 Income from capital grants 3 1,849,921 2,870,700 Income from other activities 3 13,215,125 8,136,389 Total Revenue 943,321,803 917,967,926 EXPENSES Administration, Boarding and Depreciation 4 149,656,349 140,487,558 Employee benefits 4 609,090,502 576,270,572 Finance costs 8,568,040 9,254,521 Operating Costs 4 105,133,587 117,830,315 Trading activities – Gross Expenditure 14,698,179 20,178,364 Other Significant expenses 4 2,013,391 2,541,245 Total Expenses 889,160,048 866,562,575 Profit/(Loss) for the year 54,161,755 51,405,351 OTHER COMPREHENSIVE INCOME Changes in Reserves - 79,120 Total other comprehensive income/(loss)for the year - 79,120 Total comprehensive income for the year 54,161,755 51,484,471 . The above Statement of Profit or Loss and Other Comprehensive Income should be read in conjunction with the accompanying notes. Edmund Rice Education Australia 2020 / Financial Statements / 3 The Trustees of Edmund Rice Education Australia Consolidated Entity Statement of Financial Position For the year ended 31 December 2020 2020 2019 Notes $ $ ASSETS Current assets Cash and cash equivalents 16 327,755,074 290,561,461 Trade and other receivables 5 22,776,099 23,876,477 Inventories 12 4,090,706 4,796,692 Other current assets 13 8,062,564 9,709,114 Financial assets 6 24,745,683 22,958,497 Total current assets 387,430,126 351,902,241 Non-current assets Trade and other receivables 5 8,007,373 7,528,956 Financial assets 6 7,982,542 9,904,033 Property, plant and equipment 7 2,128,992,187 2,092,704,928 Intangible assets 14 440,000 440,000 Total non-current assets 2,145,422,102 2,110,577,917 2,532,852,228 2,462,480,158 Total assets LIABILITIES Current liabilities Trade and other payables 8 61,212,511 79,280,868 Financial liabilities 9 39,345,341 40,830,267 Short term provisions 10 104,353,094 95,868,877 Other liabilities 11 36,445,392 41,042,815 Total current liabilities 241,356,338 257,022,827 Non-current liabilities Financial liabilities 9 197,377,509 169,825,374 Long term provisions 10 178,619 137,786 Other liabilities 11 24,451,066 44,732,789 Total non-current liabilities 222,007,194 214,695,949 Total liabilities 463,363,532 471,718,776 Net assets 2,069,488,696 1,990,761,382 EQUITY Retained surplus 15 1,985,400,034 1,901,973,842 Reserves 15 84,088,662 88,787,540 Total equity 2,069,488,696 1,990,761,382 The above State of Financial Position should be read in conjunction with the accompanying notes. Edmund Rice Education Australia 2020 / Financial Statements / 4 The Trustees of Edmund Rice Education Australia Consolidated Entity Statement of Changes in Equity For the year ended 31 December 2020 Retained Reserves Total Surplus Equity $ $ $ Balance at 1 January 2019 1,852,171,424 87,105,487 1,939,276,911 Total Comprehensive Income 51,484,471 - 51,484,471 Profit transferred to reserve (1,682,053) 1,682,053 - Movements in reserves - - - Balance at 31 December 2019 1,901,973,842 88,787,540 1,990,761,382 Balance at 1 January 2020 1,901,973,842 88,787,540 1,990,761,382 Adjustment re new accounting standard 24,565,559 - 24,565,559 Revised Balance at 1 January 2020 1,926,539,401 88,787,540 2,015,326,941 Total Comprehensive Income 54,161,755 - 54,161,755 Profit transferred to reserve 4,698,878 (4,698,878) - Movements in reserves - - - Balance at 31 December 2020 1,985,400,034 84,088,662 2,069,488,696 The above Statement of Changes in Equity should be read in conjunction with the accompanying notes. Edmund Rice Education Australia 2020 / Financial Statements / 5 The Trustees of Edmund Rice Education Australia Consolidated Entity Statement of Cash Flows For the year ended 31 December 2020 2020 2019 Notes $ $ CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers 436,813,281 436,167,335 Receipts form government 508,226,860 478,140,996 Payments to suppliers and employees (806,101,756) (781,471,972) Interest received 4,266,932 6,203,887 Borrowing costs paid (8,689,946) (9,259,026) Net cash generated from operating activities 16(b) 134,515,371 129,781,220 CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property, plant and equipment 2,896,413 1,475,046 Payments for property, plant and equipment (115,656,786) (91,587,001) Proceeds from insurance claims - - Proceeds from sale of investments 2,399,214 - Payments for investments (477,646) (1,414,923) Reclassification of financial assets - - Net cash used in investing activities (110,838,805) (91,526,878) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from borrowings 59,787,061 46,102,026 Repayment of borrowings (40,083,127) (51,859,190) Net proceeds / (Repayments) of finance lease commitments (6,186,887) (6,755,155) Net cash from (used in) financing activities 13,517,047 (12,512,319) Net increase (decrease) in cash held 37,193,613 25,742,023 Cash and cash equivalents at the beginning of the year 290,561,461 264,819,438 Cash and cash equivalents at the end of the year 16(a) 327,755,074 290,561,461 The above Consolidated Statement of Cash Flows should be read in conjunction with the accompanying notes. Edmund Rice Education Australia 2020 / Financial Statements / 6 Notes to the Financial Statements 1. SIGNIFICANT EVENTS On establishment of EREA as a Public Juridical Person (PJP), an Agreement (“Agreement”) in 2013 was formally entered into between the Trustees of Christian Brothers Oceania Province and the Trustees of Edmund Rice Education Australia, which set out the provisions for implementing the transfer by the Christian Brothers Civil Entities to the TEREA Civil Entity, of the Christian Brothers civil entities' legal title and beneficial interest in the educational facilities, educational resources and the land which will enable the TEREA Civil Entity to own, govern, manage and conduct the educational facilities. New and Revised Accounting Standards that have been issued but not yet effective At the date of authorisation of the financial statements, EREA has not applied the following new and revised Australian Accounting Standards, Interpretations and amendments, that have been issued but are not yet effective: x AASB 1060 General Purpose Financial Statements – Simplified Disclosures for For-Profit and Not-for-Profit Tier 2 Entities New and Revised Accounting Standards that have been issued and are effective EREA complies with AASB 1054 Australian Additional Disclosures as a charity registered with the Australian Charities and Not-for-profits Commission, in disclosing information concerning compliance with all the recognition and measurement requirements in Australian Accounting Standards (AAS). These requirements are effective for annual periods ending on or after 30 June 2020, that is, for EREA for the year ended 31 December 2020. New and Revised Accounting Standards that were previously issued and implemented in respect of the 2019 financial year In the 2019 year, EREA adopted the new accounting pronouncements which became effective that year, being x AASB 15 Revenue from Contracts with customers x AASB 16 Leases x AASB 1058 Income for Not-for-Profit entities AASB 1058 clarifies and simplifies the income recognition and measurement requirements that apply to Not-for-profit (NFP) entities in conjunction with AASB 15. AASB 1058 and AASB 15 (see below) supersede all the income recognition and measurement requirements relating to private sector NFP entities, and the majority of income recognition and measurement requirements relating to public sector NFP entities, previously in AASB 1004 Contributions. Identifiable impacts at the date of the 2020 report were: Some grants received by EREA were recognised as a liability, and subsequently recognised progressively as revenue as it satisfies its performance obligations under the grant agreement.