20 CPA AUSTRALIA 19INTEGRATED REPORT TABLE OF CONTENTS About this report 1 IMPACT POLICY GLOBALLY AND BE ACTIVE IN Who we are 2 COMMUNITY ADVOCACY 66 President’s report 6 Policy and advocacy 68 Chief Executive Officer’s report 8 Independent limited assurance report 71 Strategy 10 GOVERNANCE AND FINANCIAL REPORT 73 External environment 11 Board of Directors 75 Member journey 12 Councils and committees 80 Our business model 14 Report of the Board of Directors 84 Materiality 16 Auditor’s independence declaration 88 Performance summary 20 Overview of financial results 89 Financial performance 22 Discussion and analysis of the financial results 2019 91 Statement of profit or loss and other comprehensive income 94 PROTECT, PROMOTE AND ENHANCE THE INTEGRITY OF THE DESIGNATION 24 Statement of financial position 95 Governance 26 Statement of changes in members’ funds 96 Risks and opportunities 29 Statement of cash flows 97 Brand and reputation 31 Notes to the financial statements 98 Public interest and professional standards 33 Director’s declaration 137 Independent Auditor’s report 138 LEAD THE FUTURE OF THE Schedule of directors’ remuneration ACCOUNTING PROFESSION 38 for the year ended 31 December 2019 143 Lead the future of the accounting profession 40 Independent Auditor’s report – schedule of Directors’ remuneration 147 PROVIDE MEMBERS WITH PERSONALISED AND ENGAGING EXPERIENCES 42 Acronyms 149 Member engagement and satisfaction 44 Office locations 150 Member demographics 46 Member trust and engagement 50 Our people 54 PROVIDE RELEVANT LEARNING AND DEVELOPMENT CONTENT RESOURCES AND TOOLS 56 Professional development and knowledge 58 ATTRACT AND DEVELOP THE NEXT GENERATION OF CPAS 60 Attract and develop the next generation of CPAs 62 CPA program and certification 64 CPA Australia members featured on front cover: Shriya Gupta ASA, Business Information Analyst, Deakin University CPA Australia Integrated Report 2019 CPA William Young CPA, Executive Director – Head of Australia, COS Capital ABOUT THIS REPORT This annual report covers the activities This structure also reflects our strategic of CPA Australia Ltd (CPA Australia) and goals and related activities for 2019, The Board of Directors its controlled entities and is inclusive of and our expectations for 2020 and acknowledges its operations in Australia, Asia, Europe, beyond. The principal audience for United Arab Emirates (UAE), New this report is our members, but the responsibility for the Annual Zealand and the Pacific for the calendar information is also of value to other Integrated Report and year 1 January to 31 December 2019. stakeholders (pages 17 to 19). has been involved in its Our last report covered the calendar development and direction year to 31 December 2018 and was THE FINANCIAL REPORT from the beginning. The published in April 2019. The financial section at the end of this Board reviewed, considered report is a general-purpose financial THE INTEGRATED REPORT report that has been prepared in and provided feedback on a This report has been prepared with accordance with the Accounting draft of the report at its March reference to the fundamental concepts, Standards, Interpretations and other 2020 meeting. It is the Board’s guiding principles and content authoritative pronouncements of the collective view that the elements of the International Integrated Australian Accounting Standards Board report has been prepared Reporting Council’s (IIRC) Integrated (AASB) and the Corporations Act 2001. Reporting (<IR>) Framework. in accordance with the Accounting Standards include Content Elements of the CPA Australia is committed to playing Australian equivalents to International <IR> Framework. The an important role in driving the uptake Financial Reporting Standards (A-IFRS). report has received Limited of <IR> as it provides a more complete Compliance with A-IFRS ensures that picture as to how a business creates the financial statements and notes Assurance on this basis. and preserves value. of the Consolidated Entity comply In 2020, we will continue to with International Financial Reporting work towards full alignment We believe that Integrated Reporting Standards (IFRS). with the <IR> Framework. represents an important opportunity for our members to play a pivotal role In the current year, we have adopted in ensuring that integrated thinking one new Australian Accounting Standard In 2019, we have changed the on the capitals described in the <IR> issued by the AASB, AASB 16 Leases measurement method for the key Framework (financial, manufactured, which was mandatorily effective for performance indicator (KPI), ‘Value for intellectual, human, natural, social and accounting periods on or after money CPD’. This now reports on those relationship) feed into strategy, business 1 January 2019. The impact of changes who have experienced our CPD offer management and reporting. due to the adoption of AASB 16 Leases in the last 12 months. Previously this is outlined in Note 3 – changes in metric reported on both those who had CPA Australia is a member of the IIRC, significant accounting policies. experienced CPD in the last 12 months driving CPA Australia’s commitment to and those who hadn’t. Integrated Reporting. More details on There are no material exclusions from this the IIRC and the <IR> Framework can report. There have been no significant Due to a change in the system used to be found at theiirc.org changes to our size or ownership from record CPA Congress delegates, we previous reporting periods. have restated the 2017 number from CPA Australia is a member of the IIRC more than 9000 as reported in our 2018 <IR> Business Network. This network is SUSTAINABILITY REPORTING report to more than 8700. We have also for organisations committed to integrated In 2019, we have moved away from restated the 2017 and 2018 figures for thinking and reporting in the evolution reporting under the Global Reporting percentage of members undertaking of corporate reporting. Initiative (GRI) Sustainability Reporting CPD through CPA Australia from We are committed to assurance, which Standards as there are a limited number 18.3 per cent to 17.1 per cent (2017) and we believe is fundamental to enhancing of topic-specific standards that are 21.8 per cent to 20.7 per cent (2018). the credibility of our report and to applicable to our operations. We remain This report is available online at providing a complete and transparent supportive of the GRI and believe the picture of how we create value, both Standards are an appropriate reporting cpaaustralia.com.au/annualreport framework for many organisations to now and into the future. The online version of this report report on their non-financial impacts. contains links to further information This report is structured to provide As we continue to adopt the <IR> as referenced throughout this report readers with a comprehensive picture Framework, we have found that this has as being available on our website. of how CPA Australia has created value greater applicability to CPA Australia due through our business model and how we to the nature of our organisation and intend to do so for the short, medium and thus our focus is on moving to assurance Australia Integrated Report 2019 CPA long-term*. It is based on the material under the <IR> Framework. For more | * Short-term impact is likely to occur in the next 1 issues identified through our materiality information about the GRI and the one to two years, medium-term within two to determination process (page 16). Standards, please visit globalreporting.org five years and long-term in five years or more. WHO WE ARE Members: 166,166 Employees: 554* Revenue: $172.9m Average years’ membership: 15 Surplus: $4.4m CPA Australia is one of the world’s largest accounting bodies with a history of more than 133 years. Further information on our members can be found on pages 46 to 49. Our core services to members include education, training, technical support and advocacy. Employees and members work together with local and international bodies to represent the views and concerns of the profession to governments, regulators, standard setters, industries, academia and the general public. Our sphere of operations covers offices and representative offices in all states and territories of Australia, Mainland China, Hong Kong Special Administrative Region (SAR), Macau SAR, Taiwan, Fiji, Indonesia, Malaysia, New Zealand, Singapore, the UK, CPA Australia Integrated Report 2019 CPA UAE and Vietnam. | 2 *Employee count is all employees (including part-time). Employee figure in the financial report differs as it reports on full time equivalent (FTE). OUR VISION The Board is responsible for a number of decisions including: Partnering with members to prepare for today • Setting and approving the organisation’s strategy, direction and tomorrow in a globally connected world. and financial objectives • Overseeing all aspects of the organisation’s performance OUR PURPOSE • Appointing the President and Deputy Presidents Advancing trusted and valued accounting and business professionals who enhance their communities. • Approving financial statements • Evaluating the CEO’s performance GOVERNANCE AND ORGANISATIONAL STRUCTURE • Making and amending By-Laws. The Board of Directors is the governing body of CPA Australia. The Board independently and objectively assesses the The governance structure of the organisation during 2019 organisation’s decisions and oversees the performance is shown in Figure 1. and activities of management. FIGURE 1: GOVERNANCE