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Master Builders Association of the ACT and Controlled Entity Financial Statements FOR THE YEAR ENDED 30 JUNE 2011


Contents

Contents.............................................................................................................................................Page Treasurer’s Report.......................................................................................................................................................3 2010 - 2011 Financial Report.................................................................................................................5 Operating Report..........................................................................................................................................5 Statement by Members of the Council of Management................................................................9 Independent Audit Report to the Members..............................................................................10-11 Statement of Comprehensive Income................................................................................................ 12 Statement of Financial Position............................................................................................................ 13 Statement of Changes to Equity........................................................................................................... 14 Statement of Cash Flows......................................................................................................................... 15 Notes to the Financial Statements.................................................................................................16-35

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Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


Treasurer’s Report

It is pleasing that this being my third report as Treasurer I am able to once again to reflect on a sound financial performance for Master Builders Association of the ACT and our related entity, MBA Group Training. Last year I was able to provide some comforting commentary on the response by the Australian economy against a background of uncertainty delivered a year earlier in the form of the Global Financial Crisis. The positive aspect of Australia’s economic performance against other developed economies during that previous year was in many ways staggeringly above average. This was reflected further in the ACT’s performance against other Australian jurisdictions. We have continued to defy expectations until now but indicators are that greater diligence will be needed to steer our way through the coming year or so. Tight financial management and constant scrutiny of our operations, both principles essential in good times and bad, will take on greater prominence with further uncertain times ahead. Despite all of the challenges, the volatility in world markets, and changes to the way we conduct our business, history does tell us that this is not the first time the industry has had to ride out a storm. The industry is resilient and there is much data to support the reality that there will be work ahead. Canberra Construction Snapshot and Australian Construction Industry Forecast data provides some room for optimism. The annual under build on residential dwellings in Australia alone says there is much work ahead. In providing the consolidated financial report to reflect the relationship between the Master Builders Association of the ACT and MBA Group Training, I present the following overview of the activities and performance of each entity during the 2010-11 financial year.

Master Builders Association of the ACT: A surplus of $250,145 has been recorded for MBA-ACT as the parent entity for the financial year ending 30 June 2011. This result exceeded the original budget forecast surplus notwithstanding some higher expenses associated with employment of a new technical services manager to provide assistance in building quality and planning issues. In ongoing uncertain economic times currently being experienced, the executive committee maintains a position where borrowings by the Association are kept at a minimum. We still retain the 400m² of space on the upper level of our building that

has income potential. There have been some discussions with potential users. All revenues and expenditures are closely monitored to ensure that delivery of member services are not put at risk and every opportunity is provided to enhance those services. Membership has remained steady during the financial year. Our major showpiece event, the Master Builders and Boral Excellence in Building Awards continues to achieve its objective to showcase the Association and work of members. We look to it as well as other events to provide excellent member networking opportunities. Communication with the membership is vital and a lot of work has taken place this year to further improve our website and other communication mediums to help members in their businesses. A budget surplus has been set and confirmed for the 2011-12 financial year. I remain confident that given the processes we have in place to monitor and adjust our activities I will be able to report on a sound result for MBA-ACT this time next year.

Master Builders Group Training: The result of MBA Group Training in the past year is a reflection of not only continued Government support for training activities but the diligence and hard work of the staff. It is a well known fact that our training operation has had to deal with difficult trading periods in the past and has required financial support by MBAACT. Pleasingly, we have achieved a surplus of $760,538 for the year ending 30 June 2011. We know with the continued uncertainty surrounding the financial markets and the impacts on activity in building and construction, our results can be varied and often quite quickly. This is why it is important for us to remain vigilant in this part of our operation. We slightly increased our apprentice numbers during the last year and pleasingly in the face of the predicted uncertainty placement with industry continued to be strong. As reported in the previous financial year, Construction Industry Induction Card (White Card) training kept the skills centre quite busy in the first half of the financial year with a steady stream of courses maintained into the new year. Builder’s licensing training continues to be in strong demand and we have introduced other new courses for work health and safety, energy rating and green building. Funding by the Commonwealth to recognize skills of existing workers has also ensured a busy training operation.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

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Treasurer’s Report (continued)

During the year we have been looking at the options around future expansion of our training activities and continue to discuss measures to facilitate that growth. This has included investigations of nearby land. We are currently preparing to provide additional covered space and storage area to cater for our outdoor training which is constantly in use. This will ensure more year round opportunities for training and better protection for those in training. Again, this has been a pleasing year for MBA Group Training and we look forward to the challenges ahead.

Conclusion: I conclude this report by thanking my executive committee colleagues for their diligence and support in helping us all keep our eye on the financial ball. The accounts team capably lead by Senior Management Accountant, Louise McCallum continues to produce timely and detailed information. It is with this information at hand that we can closely monitor the financial performance of the entities. I look forward to being in a position to report just as positively next year.

Simon Butt Treasurer

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Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


OPERATING REPORT for the year ended 30 June 2011

Your Members of the Council of Management present this report on Master Builders Association of the ACT and its controlled entity for the financial year ended 30 June 2011.

Members of the Council of Management The names of the Members of the Council of Management at any time during, or since the end of, the year are:

Right of Members to Resign As required to be disclosed by section 174 of the RAO Schedule (of the Workplace Relations Act 1996), in accordance with Rule 8 of the Association’s rules a member may resign from the Association by written notice addressed and delivered to a person designated for the purpose in the rules of the Association.

Mr Ross Barrett (President) Mr Simon Butt (Treasurer) Mr Sam Delorenzo resigned 8 October 2010 Mr Michael De Simone resigned 8 October 2010 Mr Peter Fairburn resigned 8 October 2010 Mr Hans Sommer Mr Peter Middleton (Alternate) Mr Andrew Kerec resigned 8 October 2010 Mr Stephen Wise (Alternate) resigned 1 November 2010 Mr Rob Purdon (Alternate) Ms Gracie Ferreira Mr David Jones appointed 8 October 2010 Mr Frank Porreca (Alternate) appointed 8 October 2010 Mr Valdis Luks appointed 8 October 2010 Mr David Howarth appointed 8 October 2010 Mr David Morgan (Alternate) appointed 8 October 2010 Mr Alan Seymour (Alternate) appointed 6 December 2010 Members of the Council of Management have been in Council since the start of the financial year to the date of this report unless otherwise stated.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

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OPERATING REPORT for the year ended 30 June 2011 Superannuation Trustees As required to be disclosed by the RAO Schedule (of the Workplace Relations Act 1996), no officer of the Association holds any position in relation to acting as a trustee of a superannuation entity or exempt public sector superannuation scheme, where a criterion for the officer holding such a position is that the officer is an officer of a registered organisation. The following is a listing of members who are trustees of superannuation funds:

Superannuation Trustees

6

Name Company

Name Company

Orlando Sajler

Poise Pty Ltd

Darren Orchard

G & H Aluminium Fabricators

Terry Davis

Davis S & J M

Mark Sutton

SMI Fitout Pty Ltd

Stewart Fawcett

Adept Building Pty Ltd

Peter Wright

Jorge Moreno

Herron Cleaning Services Pty Ltd

Construction Control Holdings Pty Ltd

Gabriel Gaha

Gaha Group Pty Ltd

Ross Burke

Modern Plaster Pty Ltd

Trevor Duncan

Duncan Homes Pty Ltd

Phil Robinson

Robinson Building Group

Steven Elliott

Ellcon

Stephen Seckar

Jewel Enterprises Pty Ltd

Robert Rosin

Rosin Building Pty Ltd

Sam Delorenzo

Delorco Pty Ltd

Ross Barrett

Woden Contractors Pty Ltd

Mladen Rogic

Modern Creative Designs Pty Ltd

Ken Hopkins

Hopkins, Ken

Bernado Da Silva

B & M Scaffolding Pty Ltd

Jason Duncan

Duncans Plumbing Services Pty Ltd

John MacGilvray

J J Joinery

Peter Sarris

NDH Constructions Pty Ltd

Tony Milne

Saltbush Roofing Pty Ltd

David Howarth

Blackett Homes (AUST) Pty Ltd

Harry Haralambous

HDL Projects Pty Ltd

Simon Butt

Manteena Pty Ltd

Bob Rutherford

Rutherford R.D

Simon Butt

Strine Construction Pty Ltd

Craig Williams

Swic Pacific

Boris Stojanoski

Bost Pty Ltd

Stefan Stefanac

Patrician Homes Pty Ltd

Chris Hudina

CDH Developments Pty Ltd

Tony Trobe

TT Architecture (ACT) Pty Ltd

Michael Medic

Adria Constructions Pty Ltd

Mark O’Shea

Kenro Services

Bruce Harman

H & H Subcontractors

Patrick Kirkland

Get Real Painting & Maintenance

Robert Fraser

QBG Constructions

David Cooper

Cooper D & L

Robert Purdon

Purdon Associates Pty Ltd

Wayne Richards

Erincole Building Services Pty Ltd

Craig Elvin

Elvin Group Pty Ltd

Andrew Haydon

Haydon & Company Pty Ltd

Wayne Gregory

Canberra Sand & Gravel Pty Ltd

Cathy Aloe

FGC Developments

Anthony Ikic

Aztec Homes

Anthony Lucas

Caliber Kitchens

Ian Carroll

Carroll Constructions (ACT) Pty Ltd

Anthony Ikic

Aztec Homes

Tony Lawless

A & J Bathrooms Pty Ltd

Ken Horsham

Community Housing Canberra Ltd

John Fielding

Bellavarde Constructions Pty Ltd

Ivan Domazet

Doma Constructions Pty Ltd

Peter Morrison

Able Landscaping Pty Ltd

Graham Woods

Plan-It Build

John Ainsworth

ABA Construction Managers Pty Ltd

Alan Joyce

Workrite Commercial Interiors

David Charman

John Hailey

Hailey, John

Charman Earthmoving & Heavy Haulage Pty Ltd

Alastair MacCallum

AMC Projects Pty Ltd

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


OPERATING REPORT for the year ended 30 June 2011

Superannuation Trustees (continued) Name Company

Name Company

Peter Jacob

Deemro Pty Ltd

Tony Marburg

Marburg Management Pty Ltd

Josip & Angelo Turcin

Solitaire Homes

Ian Carter

PBS Building (ACT) Pty Ltd

Bruce Douglas

Douglas Joinery Pty Ltd

Don Rowling

Col Alexander

Canberra Investment Corporation

A C & R Commercial Kitchens Pty Ltd

Paul Powderly

Bob Beaver

Beasec Enterprises Pty Ltd

Colliers International (ACT) Pty Ltd

Mimmi Freebody

MMM Bathrooms

Werner Kley

W.J & L.S Constructions Pty Ltd

Mike Raffety

Raffety, Mike

George Tanchevski

Classic Constructions

Mark De Jager

W T Partnership

Braden Roy Shield

Professional Tiling Services

Andrew Foster

Drewaire Constructions Pty Ltd

Patrick Seears

Seears Workwear

David Sutton

Sutton D

John Collet

Stephen Wise

Defire (ACT) Pty Ltd

Cercol Construction Services Pty Ltd

John Dennehy

Snowmax Pty Ltd

Robert Vidovic

M & R Investments Pty Ltd

David Sevi

Whiteholme (Canberra) Pty Ltd

Ric Butt

Strine Construction Pty Ltd

Bernie Wilson

Truss Me

Graham Reilly

John Harris

O’Connor J S Harris & Co

Huon Management Services Pty Ltd

Rade Draskovic

Viewmax Pty Ltd

Terry Fox

George Haridemos

New Age Living

Foxy’s Landscaping Australia Pty Ltd

Jason Korda

Contemporary Kitchens

Rohan Arnold

Mass Australia Pty Ltd

Peter Middleton

Woden Contractors Pty Ltd

Paul Bombardier

DSB Landscape Architects

Joe Pratezina

Monarch Building Solutions Pty Ltd

Andrew Cappuccio

Cappuccio A

Tim Swain

BDA Architects Pty Ltd

Andrew Kerec

Renaissance Homes

Barry Morris

Steven Beljanski

Clarke & Di Pauli Pty Ltd

Amalgamated Property Group Pty Ltd

Dennis Milin

Milin Bros Pty Ltd

Paul Hinds

Hinds Constructions

Joe Tokich

Helkeast Pty Ltd

Michael De Simone

Canberra Contractors Pty Ltd

John Queneau

Q Projects Pty Ltd

Nick Rowe

Rick Meneghel

Artistic Concrete Pty Ltd

NJR Building & Construction Pty Ltd

Antoni Paragalli

Paraco Projects

Peter Vincent

P & K Joinery Pty Ltd

Michael O’Brian

Ram Constructions

Peter Leary

Steve Barnsley

Mail Mcdonald Barnsley Pty Ltd

Reliance Building Services (AUST) Pty Ltd

Michael Cooper

Baxter Engineering (ACT) Pty Ltd

Jim Taylor

Taylor Jim Plumbing

Paul Thoms

The Playground People

Peter Glen

Glen Peter Constructions Pty Ltd

Ken Horsham

Community Housing Canberra Ltd

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

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OPERATING REPORT for the year ended 30 June 2011

Review of Operations

Number of Members

The consolidated profit of the consolidated group amounted to $1,010,683 (2010: $739,785). The profit of the parent entity amounted to $250,145 (2010: $198,698).

The number of persons who, at the end of the financial year, were recorded on the Register of Members was 1,119 (2010: 1,095).

A review of operations of the association and its subsidiary during the financial year and the results of those operations found that preparing the Journal in-house assisted in achieving an increase of revenue of 6% which resulted in an increase of profit of 36%.

Number of Employees

Significant Changes in the State of Affairs No significant changes in the association’s state of affairs occurred during the financial year.

The number of persons who were, at the end of the financial year, employees of the Association was 15, measured on a full time equivalent basis. Signed in accordance with a resolution of the Members of the Council of Management.

Principal Activities The principal activities of the association during the financial year were to represent all sectors of the local housing and construction industry. Events Subsequent to the End of Reporting Period

President

No matters or circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the association, the results of those operations, or the state of affairs of the association in future financial years.

Treasurer

Likely Developments and Expect Results of Operations

Dated this 6th day of September 2011

The association expects to maintain the present status and level of operations. Likely developments in the operations of the association and the expected results of those operations in future financial years have not been included in this report as the inclusion of such information is likely to result in unreasonable prejudice to the association. Environmental Regulation The association’s operations are not regulated by any significant environmental regulation under a law of the Commonwealth or of a state or territory.

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Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


STATEMENT BY MEMBERS OF THE Council of Management

We R Barrett and S Butt, being two members of the Council of Management of the Master Builders Association of the ACT, do state on behalf of the Council that in the opinion of the Council: 1. The financial statements and notes comply with the Australian Accounting Standards, mandatory professional reporting requirements and other authoritative pronouncements of the Australian Accounting Standards Board;

(iii) The financial records of the Master Builders Association of the ACT have been kept and maintained in accordance with the RAO Schedule and the RAO Regulations; (iv) The information sought in any request of a member of the Master Builders Association of the ACT or a Registrar duly made under section 272 of the RAO Schedule has been furnished to the member or Registrar; and

2. The financial statements and notes comply with the reporting guidelines of the Industrial Registrar for purposes of section 270 of the RAO Schedule;

(v) There has been compliance with any order for inspection of financial records made by the Commission under section 273 of the RAO Schedule.

3. The financial statements and notes give a true and fair view of the financial performance, financial position and cash flows of the reporting unit for the financial year to which they relate;

Signed in accordance with a resolution of the Members of the Council of Management passed on the 6th September 2011.

4. At the date of this report there are reasonable grounds to believe that the Master Builders Association of the ACT will be able to pay its debts as and when they fall due; and 5. During the financial year to which the financial report relates and since the end of that year:

President

(i) Meetings of the Council were held in accordance with the rules of the organisation including the rules of the branch concerned; (ii) The financial affairs of the Master Builders Association of the ACT have been managed in accordance with the rules of the organisation including the rules of the branch concerned;

Treasurer Dated this 6th day of September 2011

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

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INDEPENDENT AUDIT REPORT To the Members

Report on the Financial Report We have audited the accompanying financial report of of the ACT and controlled entity (the association) which comprises the statement of financial position as at 30 June 2011, the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the statement by members of the Council of Management (the council).

Council’s Responsibility for the Financial Report The council of the association is responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the Associations Incorporation Act 1991 (ACT) and for such internal control as the council determines is necessary to enable the preparation of the financial report that is free from material misstatement, whether due to fraud or error.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preperationof the financial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the council, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have provide a basis for our audit opinion.

Auditor’s Responsibility Our responsibility is to express an opinion. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

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Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


INDEPENDENT AUDIT REPORT To the Members

Auditor’s Opinion In our opinion, the financial report of the Master Builders’ Association of the ACT and controlled entity (the association) is in accordance with the Associations Incorporations Act 1991 (ACT) and the Workplace Relations Act 1996, including: (i) giving a true and fair view of the association’s financial position as at 30 June 2011 and of its performance for the year ended on that date; and (ii) complying with Australian Standards.

A.B Papps, PricewatehouseCoopers, 44 Sydney Ave, Forrest ACT 2603 Dated this 7th day of September 2011

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

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STATEMENT OF COMPREHENSIVE INCOME for the Year Ended 30 June 2011

Consolidated Group Note

2011 $

2010 $

2010 $

9,632,382

9,060,654

3,354,772

3,142,052

(5,901,605)

(5,701,568)

(1,472,663)

(1,359,314)

(363,248)

(352,732)

(311,687)

(293,931)

Rent expense

(34,417)

(30,226)

(34,417)

(30,226)

Meetings and seminars

(15,965)

(13,467)

(15,905)

(13,062)

Printing, postage and stationery expense

(192,826)

(204,239)

(135,263)

(117,552)

Subscriptions

(147,657)

(137,880)

(139,392)

(130,912)

Consultant expense

(499,374)

(576,929)

(97,364)

(243,796)

Motor vehicle expense

(64,874)

(80,462)

(48,913)

(62,000)

Donations and sponsorship

(36,478)

(11,700)

(10,932)

(8,000)

Building awards expense

(421,744)

(283,031)

(421,744)

(283,031)

Worker’s compensation expense

(238,005)

(217,765)

(9,491)

(10,873)

Insurance expense

(63,314)

(62,637)

(37,041)

(34,634)

Skills Centre expenses

(13,493)

(14,802)

(13,493)

(14,802)

20,938

(9,473)

3,176

(3,176)

Other expenses

(649,637)

(623,958)

(359,498)

(338,045)

Profit for the year

1,010,683

739,785

250,145

198,698

-

-

-

-

Total comprehensive income for the year

1,010,683

739,785

250,145

198,698

Total comprehensive income attributed to members of the entity

1,010,683

739,785

250,145

198,698

Revenue

2

Employee benefits expense Depreciation and amortisation expense

Bad debts income/(expense)

Other comprehensive income

12

2011 $

Parent Entity

3

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


STATEMENT OF FINANCIAL POSITION as at 30 June 2011

Consolidated Group Note

Parent Entity

2011 $

2010 $

2011 $

2010 $

ASSETS CURRENT ASSETS Cash and cash equivalents

6

4,496,214

2,758,376

1,953,561

1,270,124

Trade and other receivables

7

887,206

1,260,842

315,139

393,571

Inventories

8

2,243

2,052

2,243

Other financial assets

9

Other current assets

10

TOTAL CURRENT ASSETS

620,000

2,052 620,000

30,576

116,202

23,829

35,676

5,416,239

4,757,472

2,294,772

2,321,423

NON-CURRENT ASSETS Trade and other receivables

7

Property, plant and equipment

11

8,419,676

8,540,289

8,230,618

8,376,128

Intangible Assets

12

59,451

50,459

59,451

50,459

Other non-current assets

10

TOTAL NON-CURRENT ASSETS TOTAL ASSETS

8,958

8,958

4,545

4,545

4,545

4,545

8,483,672

8,604,251

8,294,614

8,440,090

13,899,911

13,361,723

10,589,386

10,761,513

CURRENT LIABILITIES Trade and other payables

13

869,099

1,409,187

319,265

805,731

Short-term provisions

14

112,413

66,230

96,846

52,218

Other current liabilities

15

108,576

110,229

108,575

105,229

1,090,088

1,585,646

524,686

963,178

TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Long-term provisions

14

48,555

25,492

41,712

25,492

Other non-current liabilities

15

500,000

500,000

500,000

500,000

548,555

525,492

541,712

525,492

1,638,643

2,111,138

1,066,398

1,488,670

12,261,268

11,250,585

9,522,988

9,272,843

11,739,660

10,728,977

9,001,280

8,751,235

521,608

521,608

521,608

521,608

12,261,268

11,250,585

9,522,988

9,272,843

TOTAL NON-CURRENT LIABILITIES TOTAL LIABILITIES NET ASSETS EQUITY Retained earnings Reserves TOTAL EQUITY

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Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

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STATEMENT OF CHANGES IN EQUITY For the Year Ended 30 June 2011

CONSOLIDATED GROUP

Balance at 1 July 2009

Retained Earnings $

Asset Revaluation Reserve $

Total $

9,989,192

521,608

10,510,800

739,785

-

739,785

-

-

-

COMPREHENSIVE INCOME Profit for the year Other comprehensive income for the year TOTAL COMPREHENSIVE INCOME Balance at 30 June 2010

739,785 10,728,977

739,785 521,608

11,250,585

COMPREHENSIVE INCOME Profit for the year Other comprehensive income for the year TOTAL COMPREHENSIVE INCOME Balance at 30 June 2011

PARENT ENTITY

Balance at 1 July 2009

1,010,683

1,010,683

-

-

1,010,683

1,010,683

11,739,660

521,608

12,261,268

Retained Earnings $

Asset Revaluation Reserve $

Total $

8,552,537

521,608

9,074,145

198,698

-

198,698

-

-

-

COMPREHENSIVE INCOME Profit for the year Other comprehensive income for the year TOTAL COMPREHENSIVE INCOME Balance at 30 June 2010

198,698 8,751,235

198,698 521,608

9,272,843

COMPREHENSIVE INCOME Profit for the year Other comprehensive income for the year TOTAL COMPREHENSIVE INCOME Balance at 30 June 2011

14

250,145

250,145

-

-

250,145 9,001,380

250,145

521,608

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

9,522,988


STATEMENT OF CASH FLOWS For the Year Ended 30 June 2011

Consolidated Group

Parent Entity

2011

2010

2011

2010

$

$

$

$

11,586,480

9,662,303

4,405,544

3,434,770

152,119

55,143

57,005

33,029

(9,711,611)

(8,868,754)

(3,564,793)

(3,356,846)

2,026,988

848,692

897,756

110,953

62,500

50,454

36,364

33,635

Purchase of property, plant and equipment

(351,650)

(203,057)

(250,683)

(165,743)

Net cash (used in) investing activities

(289,150)

(152,603)

(214,319)

(132,108)

Net increase/ (decrease) in cash held

1,737,838

696,089

683,437

(21,155)

Cash and cash equivalents at beginning of financial year

2,758,376

2,062,287

1,270,124

1,291,279

4,496,214

2,758,376

1,953,561

1,270,124

Note CASH FLOWS FROM OPERATING ACTIVITIES Receipts from ordinary activities Interest received Payments to employees and suppliers 16

Net cash provided by operating activities CASH FLOWS FROM INVESTING ACTIVITIES Proceeds from sale of property, plant and equipment

Cash and cash equivalents at end of financial year

6

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

15


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

The consolidated financial statements cover the Master Builders Association of the ACT and its controlled entity (MBA Group Training Limited), and the separate financial statements cover the Master Builders Association of the ACT as an individual parent entity. The Master Builders Association of the ACT is an association incorporated in the ACT under the Associations Incorporation Act 1991.

Note 1: Summary of Significant Accounting Policies Basis of Preparation The financial statements are general purpose financial statements that have been prepared in accordance with Australian Accounting Standards (including Australian Accounting Interpretations) and the Associations Incorporation Act 1991 (ACT).

c) Property, Plant and Equipment Each class of property, plant and equipment is carried at cost or fair value as indicated less, where applicable, any accumulated depreciation and impairment losses. Plant and Equipment Plant and equipment are measured on the cost basis and are therefore carried at cost less accumulated depreciation and any accumulated impairment losses. In the event the carrying amount of plant and equipment is greater than the estimated recoverable amount, the carrying amount is written down immediately to the estimated recoverable amount. A formal assessment of recoverable amount is made when impairment indicators are present (refer to Note 1(e) for details of impairment).

Australian Accounting Standards set out accounting policies that the AASB has concluded would result in financial statements containing relevant and reliable information about transactions, events and conditions to which they apply. Material accounting policies adopted in the preparation of these financial statements are presented below and have been consistently applied unless otherwise stated.

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the association and the cost of the item can be measured reliably. All other repairs and maintenance are recognised in profit or loss during the financial period in which they are incurred.

The financial statements have been prepared on an accruals basis and are based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and financial liabilities.

The depreciable amount of all fixed assets, including buildings and capitalised lease assets, is depreciated on a straight-line basis over the asset’s useful life commencing from the time the asset is available for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful lives of the improvements. The depreciation rates used for each class of depreciable assets are:

The financial statements were authorised for issue on 6th September 2011 by the members of the association. Accounting Policies a) Income Tax No provision for income tax is necessary as the association is exempt under Section 50-15 of the Income Tax Assessment Act 1997. b) Inventories Inventories are measured at the lower of cost and net realisable value. Inventories acquired at no cost, or for nominal consideration are valued at the current replacement cost

16

as at the date of acquisition.

Depreciation

Class of Fixed Asset

Depreciation Rate

Land and Building

2.5%

Plant and Equipment

6.7 – 50%

Motor Vehicle

22.50%

The assets’ residual values and useful lives are reviewed and adjusted, if appropriate, at the end of each reporting period. Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the statement of comprehensive income. When revalued assets are sold, amounts included in the revaluation relating to that asset are transferred to retained earnings.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Note 1: Summary of Significant Accounting Policies (continued) d) Financial Instruments

(ii) Loans and receivables

Initial recognition and measurement Financial assets and financial liabilities are recognised when the association becomes a party to the contractual provisions to the instrument. For financial assets, this is equivalent to the date that the association commits itself to either purchase or sell the asset (ie trade date accounting is adopted).

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost.

Financial instruments are initially measured at fair value plus transaction costs except where the instrument is classified “at fair value through profit or loss”, in which case transaction costs are expensed to profit or loss immediately. Classification and subsequent measurement Financial instruments are subsequently measured at fair value, amortised cost using the effective interest rate method, or cost. Fair value represents the amount for which an asset could be exchanged or a liability settled, between knowledgeable, willing parties. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted. Amortised cost is the amount at which the financial asset or financial liability is measured at initial recognition less principal repayments and any reduction for impairment, and adjusted for any cumulative amortisation of the difference between that initial amount and the maturity amount calculated using the effective interest rate method. The association does not designate any interests in subsidiaries, associates or joint venture entities as being subject to the requirements of Accounting Standards specifically applicable to financial instruments. (i) Financial assets at fair value through profit or loss Financial assets are classified at “fair value through profit or loss” when they are held for trading for the purpose of short-term profit taking, where they are derivatives not held for hedging purposes, or when they are designated as such to avoid an accounting mismatch or to enable performance evaluation where a group of financial assets is managed by key management personnel on a fair value basis in accordance with a documented risk management or investment strategy. Such assets are subsequently measured at fair value with changes in fair value (ie gains or losses) being recognised in profit or loss.

(iii) Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets that have fixed maturities and fixed or determinable payments, and it is the association’s intention to hold these investments to maturity. They are subsequently measured at amortised cost using the effective interest rate method. (iv) Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are either not capable of being classified into other categories of financial assets due to their nature, or they are designated as such by management. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments. They are subsequently measured at fair value with changes in such fair value (ie gains or losses) recognised in other comprehensive income (except for impairment losses and foreign exchange gains and losses). When the financial asset is derecognised, the cumulative gain or loss pertaining to that asset previously recognised in other comprehensive income is reclassified into profit or loss. (v) Financial liabilities Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost. Impairment At the end of each reporting period, the association assesses whether there is objective evidence that a financial instrument has been impaired. In the case of available-for-sale financial instruments, a prolonged decline in the value of the instrument is considered to determine whether impairment has arisen. Impairment losses are immediately recognised in profit or loss. Also, any cumulative decline in fair value previously recognised in other comprehensive income is reclassified to profit or loss at this point.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

17


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Note 1: Summary of Significant Accounting Policies (continued) Derecognition Financial assets are derecognised where the contractual right to receipt of cash flows expires or the asset is transferred to another party, whereby the assocaition no longer has any significant continuing involvement in the risks and benefits associated with the asset. Financial liabilities are derecognised where the related obligations are either discharged, cancelled or expire. The difference between the carrying value of the financial liability extinguished or transferred to another party and the fair value of consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

market yields on national government bonds with terms to maturity that match the expected timing of cash flows. h) Cash and Cash Equivalents Cash and cash equivalents include cash on hand, deposits held at-call with banks, other short-term highly liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities in the statement of financial position. i)

e) Impairment of Assets

Revenue is measured at the fair value of the consideration received or receivable after taking into account any trade discounts and volume rebates allowed. Any consideration deferred is treated as the provision of finance and is discounted at a rate of interest that is generally accepted in the market for similar arrangements. The difference between the amount initially recognised and the amount ultimately received is interest revenue.

At the end of each reporting period, the association assesses whether there is any indication that an asset may be impaired. The assessment will consider both external and internal sources of information. If such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of that asset, being the higher of the asset’s fair value less costs to sell and its value-in-use, to the asset’s carrying amount. Any excess of the asset’s carrying amount over its recoverable amount is immediately recognised in profit or loss. Where it is not possible to estimate the recoverable amount of an individual asset, the association estimates the recoverable amount of the cash generating unit to which the asset belongs.

Revenue from the sale of goods is recognised at the point of delivery as this corresponds to the transfer of significant risks and rewards of ownership of the goods and the cessation of all involvement in those goods. Revenue from the rendering of a service is recognised upon the delivery of the service to the customer.

f) Intangible Assets

Interest revenue is recognised using the effective interest rate method, which for floating rate financial assets is the rate inherent in the instrument.

Computer Software Websites and Databases are recognised at cost. Websites and Databases have a finite life and are carried at cost less any accumulated amortisation and impairment losses. It has an estimated useful life of 3 years. It is assessed annually for impairment.

Revenue from the provision of membership subscriptions is recognised on a straight-line basis over the financial year. All revenue is stated net of the amounts of goods and services tax (GST).

g) Employee Benefits Provision is made for the association’s liability for employee benefits arising from services rendered by employees to the end of the reporting period. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits. In determining the liability, consideration is given to employee wage increases and the probability that the employee may not satisfy vesting requirements. Those cash outflows are discounted using

18

Revenue and Other Income

j)

Borrowing Costs Borrowing costs directly attributable to the acquisition, construction or production of assets that necessarily take a substantial period of time to prepare for their intended use or sale, are added to the cost of those assets, until such time as the assets are substantially ready for their intended use or sale. All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Note 1: Summary of Significant Accounting Policies (continued) k) Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO). 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 ATO is included with other receivables or payables in the statement of financial position. 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 ATO are presented as operating cash flows included in receipts from customers or payments to suppliers. l)

Trade and Other Payables Trade and other payables represent the liability outstanding at the end of the reporting period for goods and services received by the association during the reporting period that remain unpaid. The balance is recognised as a current liability with the amounts normally paid within 30 days of recognition of the liability.

m) Comparative Figures When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

n) Provisions Provisions are recognised when the association has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured. Provisions recognised represent the best estimate of the amounts required to settle the obligation at the end of the reporting period. o) Key Estimates (i) Impairment The association assesses impairment at the end of each reporting period by evaluation of conditions and events specific to the association that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using value-in-use calculations which incorporate various key assumptions. p) New Accounting Standards for Application in Future Periods No accounting standard has been adopted earlier than the application date as stated in the standard. Other new standards, revised standards, interpretations and amending standards that were issued prior to the signing of the statement by the Members of the Council of Management and are applicable to the future reporting period are not expected to have a material impact on the association.

Where the association has retrospectively applied an accounting policy, made a retrospective restatement or reclassified items in its financial statements, an additional statement of financial position as at the beginning of the earliest comparative period will be disclosed.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

19


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group

Parent Entity

2011

2010

2011

2010

$

$

$

$

4,284,021

4,397,725

-

-

421,750

283,900

-

-

-

8,400

-

-

216,975

207,700

-

-

Project income

43,313

20,682

-

-

Publication sales

40,513

38,440

40,513

38,440

Skills centre funding

-

90,000

-

90,000

SNAPS

-

1,650

-

-

Sponsorship

286,064

282,000

286,064

282,000

Subscriptions

734,438

619,320

734,438

619,320

TAE funding

147,250

134,150

-

-

Training and Rebates

875,290

940,066

-

-

User choice

887,052

592,948

-

-

7,936,666

7,616,981

1,061,015

1,029,760

Annual dinner and social events

357,337

344,964

357,337

344,964

Building centre rent

106,396

136,360

106,396

136,360

-

-

415,000

375,000

Interest

152,119

55,143

57,005

33,029

Journal advertising

149,241

34,267

149,241

34,267

-

-

400,896

376,613

765,093

570,734

1,485,875

1,300,233

8,701,759

8,187,715

2,546,890

2,329,993

772,814

784,025

772,814

784,025

Profit on sale of fixed assets

18,841

8,392

17,213

3,935

Sundry income

88,060

63,377

17,855

24,099

Worker’s compensation reimbursement

50,908

17,145

-

-

930,623

872,939

807,882

812,059

9,632,382

9,060,654

3,354,772

3,142,052

Note 2: Revenue and Other Income Revenue Revenue from employer reimbursements, sales, subscriptions, sponsorship, government grants and other grants

Employer reimbursements Government grants GTTP funding Industry training fund

Other Revenue

Rent

Service fee Total Revenue Other Income Commissions and fees

Total Other Income Total Revenue and Other Income

20

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group

Parent Entity

2011

2010

2011

2010

$

$

$

$

100,479

104,188

61,733

60,518

Plant and equipment

73,918

64,328

61,103

49,197

Intangibles

13,361

8,902

13,361

8,902

175,490

175,314

175,490

175,314

363,248

352,732

311,687

293,931

Note

Note 3: Profit for the Year a) Expenses Depreciation and amortisation

Motor vehicle

Land and Building Total depreciation and amortisation b. Significant Revenue and Expenses: Employer reimbursements Employee benefits expense

4,284,021

4,397,725

-

-

(5,901,605)

(5,701,568)

(1,472,663)

(1,359,314)

Note 4: Key Management Personnel Any person(s) having authority and responsibility for planning, directing and controlling the activities of the association, directly or indirectly, including its Council members, is considered key management personnel.

Key management Personnel compensation Short-term employee benefits Post-employment benefits

781,177

902,170

655,961

683,316

80,453

101,474

65,344

83,000

861,630

1,003,644

721,305

766,316

25,000

21,300

14,000

11,900

850

800

450

400

2,600,309

2,586,250

1,293,851

1,269,724

235,795

171,326

-

-

1,659,260 -

-

659,260

-

4,496,214

2,758,376

1,953,561

1,270,124

Note 5: Auditors’ Remuneration Auditing or reviewing the financial report Note 6: Cash and Cash Equivalents Cash on hand Cash at bank ITF Short-term bank deposits 21 Reconciliation of cash Cash at the end of the financial year as shown in the statement of cash flows is reconciled to items in the statement of financial position as follows:

Cash and cash equivalents

4,496,214

2,758,376

1,953,561

1,270,124

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

21


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Consolidated Group

Parent Entity

2011

2010

2011

2010

$

$

$

$

Accounts receivable

872,893

1,001,737

315,139

241,427

Provision for impairment

(19,133)

(40,070)

-

(3,176)

26,406

299,175

-

155,320

7,040

-

-

-

887,206

1,260,842

315,139

393,571

-

8,958

-

8,958

887,206

1,269,800

315,139

402,529

Note 7: Trade and Other Receivables

Note

Current

Sundry debtors Interest receivable Total current trade and other receivables

Non-current Sundry debtors Total trade and other receviables

Current trade receivables are non-interest bearing loans and accounts receivable and generally are receivable within 30 days. A provision for impairment is recognised against accounts receivable where there is objective evidence that an individual trade receivable is impaired.

Credit risk The association has no significant concentration of credit risk with respect to any single counterparty or group of counterparties. The main source of credit risk to the association is considered to relate to the class of assets described as accounts receivable.

The following table details the association’s trade and other receivables exposed to credit risk with ageing analysis and impairment provided for thereon. Amounts are considered as ‘past due’ when the debt has not been settled within the terms and conditions agreed between the association and the counterparty to the transaction. Receivables that are past due are assessed for impairment by ascertaining their willingness to pay and are provided for where there are specific circumstances indicating that the debt may not be fully repaid to the association. The balances of receivables that remain within initial terms (as detailed in the table) are considered to be of high credit quality.

Consolidated Group Gross Amount

Past Due and Impaired

2011

Past due but not impaired (days overdue) <30

31-60

61-90

>90

Within initial trade terms

Trade receivables

872,893

(19,133)

307,908

23,140

38,775

-

503,070

Other receivables

33,446

-

4,125

330

110

-

28,881

906,339

(19,133)

312,033

23,470

38,885

-

531,951

Trade receivables

1,001,737

(40,070)

221,804

59,772

62,093

-

658,068

Other receivables

308,133

-

7,085

12,052 229,923

8,958

50,115

1,309,870

(40,070)

228,889

71,824 292,016

8,958

708,183

Total 2010

Total

22

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Parent Entity Gross Amount

Past Due and Impaired

2011

Past due but not impaired (days overdue) <30

31-60

61-90

>90

Within initial trade terms

Trade receivables

315,139

-

164,818

7,682

13,534

-

129,105

Other receivables

-

-

-

-

-

-

-

315,139

-

164,818

7,682

13,534

-

129,105

Trade receivables

241,427

(3,176)

21,666

31,089

17,123

-

171,549

Other receivables

164,278

-

-

- 155,320

8,958

-

Total

405,705

(3,176)

21,666

31,089 172,443

8,958

708,183

Total 2010

The association does not hold any financial assets whose terms have been renegotiated, but which would otherwise be past due or impaired. Collateral Held as Security No collateral is held as security for any of the trade and other receivable balances.

Financial assets classified as loans and receivables Note

Consolidated Group

Parent Entity

2011 $

2010 $

2011 $

2010 $

887,206

1,260,842

315,139

393,571

Trade and other receivables: Total current Total non - current Sundry debtors

8,958

Total trade and other receivables

21

887,206

1,269,800

8,958 315,139

Consolidated Group Note 8: Inventories

Note

402,529

Parent Entity

2011 $

2010 $

2011 $

2010 $

1,852

1,426

1,852

1,426

391

626

391

626

2,243

2,052

2,243

2,052

-

620,000

-

620,000

-

620,000

-

620,000

-

620,000

-

620,000

Current At cost - contracts - books Note 9: Other Financial Assets Held-to-maturity financial assets

9a

a. held-to-maturity financial assets comprise: Term deposit Total held-to-maturity financial assets

21

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

23


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group

Parent Entity

2011 $

2010 $

2011 $

2010 $

30,576

116,202

23,829

35,676

4,545

4,545

4,545

4,545

Land and building â&#x20AC;&#x201C; At cost

8,259,769

8,268,942

8,259,769

8,268,942

Accumulated depreciation

(350,804)

(175,314)

(350,804)

(175,314)

7,098,965

8,093,628

7,908,965

8,093,628

366,811

315,339

258,460

232,025

(164,639)

(90,722)

(125,934)

(64,831)

202,172

224,617

132,526

167,194

447,230

449,794

271,468

251,643

(138,691)

(227,750)

(82,341)

(136,337)

308,539

222,044

189,127

115,306

8,419,676

8,540,289

8,230,618

8,376,128

Note 10: Other Assets

Note

Current Prepayments Non-current Other investments Note 11: Property, Plant and Equipment

Plant and equipment - at fair value Accumulated depreciation Motor vehicles - at cost Accumulated depreciation Total property, plant and equipment

24

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Movements in carrying amounts Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year: Consolidated Group

Plant & Equipment

Land & Building

Motor Vehicles

Total

$

$

$

$

8,255,143

185,052

282,931

8,723,126

Additions

13,799

103,893

85,366

203,058

Disposals

-

-

(136,987)

(136,987)

(175,314)

(64,328)

(104,188)

(343,830)

Depreciation write back

-

-

94,922

94,922

Balance at 30 June 2010

8,093,628

224,617

222,044

8,540,289

(56,364)

-

-

(56,364)

Additions

47,191

51,473

230,634

329,298

Disposals

-

-

(233,196)

(233,196)

(175,490)

(73,918)

(100,479)

(349,887)

-

-

189,536

189,536

7,908,965

202,172

308,539

8,419,676

8,255,143

112,499

157,474

8,525,116

13,799

103,892

48,052

165,743

Balance at 1 July 2009

Depreciation expense

Adjustment to remove GST

Depreciation expense Depreciation write back Carrying amount at 30 June 2011 Parent Entity Balance at 1 July 2009 Additions Disposals

-

-

(82,289)

(82,289)

(175,314)

(49,197)

(60,518)

(285,029)

Depreciation write back

-

-

52,587

52,587

Balance at 30 June 2010

8,093,628

167,194

115,306

8,376,128

(56,364)

-

-

(56,364)

Additions

47,191

26,434

154,705

228,330

Disposals

-

-

(134,879)

(134,879)

(175,490)

(61,103)

(61,733)

(298,326)

-

-

115,729

115,729

7,098,965

132,525

189,128

8,230,618

Depreciation expense

Adjustment to remove GST

Depreciation expense Depreciation write back Carrying amount at 30 June 2011

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

25


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group Note 12: Intangible Assets Capitalised website development costs Accumulated amortisation Net carrying value Capitalised database development costs

Parent Entity

2011 $

2010 $

2011 $

2010 $

28,940

6,003

28,940

6,003

(13,383)

(2,997)

(13,383)

(2,997)

15,557

3,006

15,557

3,006

61,459

53,358

61,459

53,358

(17,565)

(5,905)

(17,565)

(5,905)

Net carrying value

43,894

47,453

43,894

47,453

Total intangible assets

59,451

50,459

59,451

50,459

Accumulated amortisation

Movements in carrying amounts

Movements in the carrying amounts for intangibles between the beginning and the end of the current financial year:

Consolidated Group

Balance at 1 July 2009 Additions Amortisation expense Balance at 30 June 2010

Website Development Costs $

Database Development Costs $

6,003

53,358

59,361

-

-

-

(2,997)

(5,905)

(8,902)

Total $

3,006

47,453

50,459

Additions

19,940

2,413

22,353

Amortisation expense

(7,389)

(5,972)

(13,361)

Carrying amount at 30 June 2011

15,557

43,894

59,451

6,003

53,358

59,361

-

-

-

(2,997)

(5,905)

(8,902)

3,006

47,453

50,459

Parent Entity Balance at 1 July 2009 Additions Amortisation expense Balance at 30 June 2010

26

Additions

19,940

2,413

22,353

Amortisation expense

(7,389)

(5,972)

(13,361)

Carrying amount at 30 June 2011

15,557

43,894

59,451

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group

Parent Entity

2011 $

2010 $

2011 $

2010 $

Trade creditors and accruals

582,273

1,095,494

233,860

723,763

Short-term employee benefits

286,826

313,693

85,405

81,968

869,099

1,409,187

319,265

805,731

869,099

1,409,187

319,265

805,731

-

-

-

-

869,099

1,409,187

319,265

805,731

Less annual leave entitlements

(286,826)

(313,693)

(85,405)

(81,968)

Less GST payable

(222,452)

(275,346)

(82,882)

(55,888)

Less wage accrual

(78,050)

-

(11,048)

-

Less PAYG payable

(70,757)

(98,658)

(25,472)

(35,214)

211,014

721,490

114,458

632,661

Note 13: Trade and Other Payables

Note

Current

13a

a. Financial liabilities at amortised cost classified as trade and other payables

Trade and other payables: - total current - total non-current

Financial liabilities as trade and other payables

21 Note

Note 14: Provisions Opening balance at 1 July 2010

91,722

77,710

Additional provisions raised during year

69,246

60,848

160,968

138,558

Balance at 30 June 2011 Analysis of Total Provisions Current Non-Current

112,413

66,230

96,846

52,218

48,555

25,492

41,712

25,492

160,968

91,722

138,558

77,710

Provision for Long-term Employee Benefits A provision has been recognised for employee entitlements relating to long service leave. In calculating the present value of future cash flows in respect of long service leave, the probability of long service leave being taken is based on historical data. The measurement and recognition criteria relating to employee benefits has been included in Note 1 to this report.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

27


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group Note 15: Other Liabilities

Parent Entity

2011 $

2010 $

2011 $

2010 $

Unearned income

14,050

31,965

14,050

26,965

Work in progress

93,910

68,678

93,910

68,678

Current

Funds held for third parties

616

9,586

615

9,586

108,576

110,229

108,575

105,229

Dunlop house loan

40,000

40,000

40,000

40,000

Unearned income

100,000

100,000

100,000

100,000

Total non-current other liabilities

500,000

500,000

500,000

500,000

Total current other liabilities Non-current

Consolidated Group Note 16: Cash Flow Information

Parent Entity

2011 $

2010 $

2011 $

2010 $

1,010,683

739,785

250,145

198,698

Depreciation and amortisation

363,248

352,734

311,687

293,933

Net gain on disposal of fixed assets

(18,841)

(8,392)

(17,213)

(3,935)

-

40,070

-

3,176

56,363

-

56,363

-

Decrease in trade and other receivables

382,594

422,600

87,390

654,650

Decrease/(increase) in financial assets

620,000

(620,000)

620,000

(620,000)

(191)

181

(191)

181

Reconciliation of cash flow from operations with profit Profit Cash flows excluded from profit attributable to operating activities Non-cash flows in profit:

Impairment expense Adjustment to fixed assets Changes in assets and liabilities:

(Increase)/decrease in inventories

85,626

377,313

11,847

399,356

(540,088)

(392,340)

(486,466)

(749,625)

(Decrease)/increase in other liabilities

(1,652)

8,792

3,346

8,793

Increase/(decrease) in employee provisions

69,246

(72,051)

60,848

(74,274)

2,026,988

848,692

897,756

110,953

Decrease in other assets (Decrease) in trade and other payables

28

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group Note 17: Capital and Leasing Commitments

Parent Entity

2011 $

2010 $

2011 $

2010 $

(a) Operating Lease Commitments Non-cancellable operating leases contracted for but not recognised in the financial statements Payable â&#x20AC;&#x201C; minimum lease payments - not later than 12 months

6,112

6,112

6,112

6,112

- between 12 months and 5 years

6,111

12,223

6,111

12,223

-

-

-

-

12,223

18,335

12,223

18,335

- greater than 5 years

The telephone system lease, which commenced in September 2008, is a 60 month lease, with rent payable monthly in advance.

Note 18 : Related Party Transactions Transactions with related parties The following Members of the Council and their related companies have had financial transactions with the association during the financial year. All monies received from the Members of the Council or their related companies relate to subscriptions or normal trading operations of the association. Consolidated Group Executive Member

Related Company

Total value of Transactions

Mr Ross Barrett/ Mr Peter Middleton

Woden Contractors Pty Ltd

$207,384

Mr Simon Butt/ Mr Rod Mitton

Manteena

$206,921

Mr Sam Delorenzo

Delorco

$31,082

Mr Andrew Kerec

Renaissance Homes

$2,975

Mr Hans Sommer

Village Building Company

$44,520

Mr Peter Fairburn

CE Industries

$820

Mr Damian Dawes

Smart Housing

$56,189

Mr Ian Carter/Mr Warren Ahrens

PBS Building

$16,927

Mr Mark Crawford/ Mr Micheal de Simon

Canberra Commercial Contractors

$105,261

Mr Alan Seymour/ Mr Stephen Wise

St Hilliers Contracting

$19,426

Mr David Morgan

A Murray

-

Mr Frank Porreca

Benchmark

-

Mr Rob Purdon

Purdon & Associates

$1,080

Mr Valdis Luks

G E Shaw

$12,539

Mr David Jones

Guideline Pty Ltd

$9,138

Mr David Howarth

Blackett Homes

$6,970

Mr Gracie Ferreira

Pacific Formwork

$1,415

Mr Tony Toscan

Toscan Glass

-

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

29


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Parent Entity Executive Member

Related Company

Total value of Transactions

Mr Ross Barrett/ Mr Peter Middleton

Woden Contractors Pty Ltd

$15,172

Mr Simon Butt/ Mr Rod Mitton

Manteena

$25,967

Mr Sam Delorenzo

Delorco

$950

Mr Andrew Kerec

Renaissance Homes

$2,975

Mr Hans Sommer

Village Building Company

$44,520

Mr Peter Fairburn

CE Industries

$820

Mr Alan Seymour/ Mr Stephen Wise

St Hilliers Contracting

$19,426

Mr David Morgan

A Murray

-

Mr Frank Porreca

Benchmark

-

Mr Warren Ahrens

PBS Building

$9,219

Mr Micheal de Simon

Canberra Commercial Contractors

$3,550

Mr Rob Purdon

Purdon & Associates

$1,080

Mr Valdis Luks

G E Shaw

$12,539

Mr David Jones

Guideline Pty Ltd

$9,138

Mr David Howarth

Blackett Homes

$6,970

Mr Gracie Ferreira

Pacific Formwork

$1,415

Note 19 : Events after the Reporting Period There have been no events subsequent to reporting date which require disclosure in the financial statements.

Note 20 : Contingent Liabilities and Assets There are no contingent liabilities or assets as at 30 June 2011 which require disclosure in the financial statements (2010: nil).

30

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Note 21 : Financial Risk Management The associationâ&#x20AC;&#x2122;s financial instruments consist mainly of deposits with banks and accounts receivable and payable. The totals for each category of financial instruments, measured in accordance with AASB 139 as detailed in the accounting policies to these financial statements, are as follows: Consolidated Group Note

Parent Entity

2011 $

2010 $

2011 $

2010 $

Financial assets Cash and cash equivalents

6

4,496,214

2,758,376

1,953,561

1,270,124

Loans and receivables

7

887,206

1,269,800

315,139

402,529

9

-

620,000

-

620,000

5,383,420

4,648,176

2,268,700

2,292,653

211,014

721,490

114,458

632,661

211,014

721,490

114,458

632,661

Held-to-maturity financial assets - Term deposits Total financial assets Financial liabilities Financial liabilities at amortised cost - Trade and other payables

13a

Total financial liabilities

Financial Risk Management Policies The Council of Managementâ&#x20AC;&#x2122;s overall risk management strategy seeks to ensure that the association meets its financial targets, whilst minimising potential adverse effects on cash flow short falls.

Specific Financial Risk Exposures and Management The main risks the association is exposed to through its financial instruments are credit risk, liquidity risk and market risk relating to interest rate risk and equity price risk. a) Credit risk Exposure to credit risk relating to financial assets arises from the potential nonperformance by counterparties of contract obligations that could lead to a financial loss to the association. Credit risk is managed through maintaining procedures (such as regular monitoring of exposure and monitoring of the financial stability of significant customers and counterparties) ensuring, to the extent possible, that members and counterparties to transactions are of sound credit worthiness.

Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit rating that the board of directorâ&#x20AC;&#x2122;s has otherwise cleared as being financially sound. Credit risk exposures The maximum exposure to credit risk by class of recognised financial assets at the end of the reporting period is equivalent to the carrying value and classification of those financial assets (net of any provisions) as presented in the statement of financial position. There is no collateral held by the association securing trade and other receivables. Trade and other receivables that are neither past due or impaired are considered to be of high credit quality. Aggregates of such amounts are detailed in Note 6. The association has no significant concentration of credit risk exposure with any single counterparty or group of counterparties. Details with respect to credit risk of trade and other receivables are provided in 6.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

31


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Note 21 : Financial Risk Management (continued)

The next tables reflect an undiscounted contractual maturity analysis for financial liabilities.

b) Liquidity risk

Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation. Actual timing may therefore differ from that disclosed. The timing of cash flows presented in the table to settle financial liabilities reflects the earliest contractual settlement dates.

Liquidity risk arises from the possibility that the association might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. The association manages this risk through the following mechanisms: • • • •

Preparing budgets; Maintaining a reputable credit profile; Managing credit risk related to financial assets; and Only investing surplus cash with major financial institutions.

Within 1 Year

1 to 5 Years

Total contractual cash flow

2011

2010

2011

2010

2011

2010

$

$

$

$

$

$

Trade and other payables

211,014

726,490

-

-

211,014

726,490

Total expected outflows

211,014

726,490

-

-

211,014

726,490

4,496,214

2,758,376

-

-

4,496,214

2,758,376

887,206

1,260,842

-

8,958

887,206

1,269,800

-

620,000

-

-

-

620,000

Total anticipated inflows

5,383,420

4,639,218

-

8,958

5,383,420

4,648,176

Net inflow on financial instruments

5,172,406

3,912,728

-

8,958

5,172,406

3,921,686

2011

2010

2011

2010

2011

2010

$

$

$

$

$

$

Trade and other payables

114,458

632,661

-

-

114,458

632,661

Total expected outflows

114,458

632,661

-

-

114,458

632,661

1,953,561

1,270,124

-

-

1,953,561

1,270,124

315,139

393,571

-

8,958

315,139

402,529

Consolidated Group Financial liabilities due for payment

Financial assets – cash flows realisable Cash and cash equivalents Trade and other receivables Held-to-maturity financial assets

Parent Entity Financial liabilities due for payment

Financial assets – cash flows realisable Cash and cash equivalents Trade and other receivables

-

620,000

-

-

-

620,000

Total anticipated inflows

2,268,700

2,283,695

-

8,958

2,268,700

2,292,653

Net inflow on financial instruments

2,154,242

1,651,034

-

8,958

2,154,242

1,659,992

Held-to-maturity financial assets

32

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011 Financial assets pledged as collateral

ii. Price risk

No financial assets have been pledged as security for any financial liability.

The association is not exposed to price risk.

c) Market risk i. Interest rate risk Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting period whereby a future change in interest rates will affect future cash flows.

Sensitivity analysis The following table illustrates sensitivities to the associationâ&#x20AC;&#x2122;s exposures to changes in interest rates. The table indicates the impact on how profit and equity values reported at the end of the reporting period would have been affected by changes in the relevant risk variable that management considers to be reasonably possible. These sensitivities assume that the movement in a particular variable is independent of other variables. Profit $

Equity $

+/- 44,954

+/- 44,954

+/- 33,776

+/- 33,776

Year Ended 30 June 2011 +/- 1% in interest rates

+/- 19,531

+/- 19,531

Year Ended 30 June 2010 +/- 1% in interest rates

+/- 18,897

+/- 18,897

Consolidated Group Year Ended 30 June 2011 +/- 1% in interest rates Year Ended 30 June 2010 +/- 1% in interest rates Parent Group

No sensitivity analysis has been performed on foreign exchange risk, as the association is not exposed to foreign currency fluctuations.

Net Fair Values Fair value estimation The fair values of financial assets and financial liabilities are presented in the following table and can be compared to their carrying values as presented in the statement of financial position. Fair values are those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an armâ&#x20AC;&#x2122;s length transaction.

Fair values derived may be based on information that is estimated or subject to judgement, where changes in assumptions may have a material impact on the amounts estimated. Areas of judgement and the assumptions have been detailed below. Where possible, valuation information used to calculate fair value is extracted from the market, with more reliable information available from markets that are actively traded. In this regard, fair values listed for listed securities are obtained from quoted market bid prices.

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

33


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Consolidated Group

2011 Footnote

2010

Net Carrying Value

Net Fair Value

Net Carrying Value

Net Fair Value

Financial assets Cash and cash equivalents

(i)

4,496,214

4,496,214

2,758,376

2,758,376

Trade and other receivables

(i)

887,206

887,206

1,269,800

1,269,800

Held-to-maturity financial assets

(ii)

-

-

620,000

620,000

5,383,420

5,383,420

4,648,176

4,648,176

211,014

211,014

726,490

726,490

211,014

211,014

726,490

726,490

Total financial assets Financial liabilities Trade and other payables

(i)

Total financial liabilities Parent Group Financial assets Cash and cash equivalents

(i)

1,953,561

1,953,561

1,270,124

1,270,124

Trade and other receivables

(i)

315,139

315,139

402,259

402,259

Held-to-maturity financial assets

(ii)

-

-

620,000

620,000

2,268,700

2,268,700

2,292,383

2,292,383

114,458

114,458

632,661

632,661

114,458

114,458

632,661

632,661

Total financial assets Financial liabilities Trade and other payables

(i)

Total financial liabilities

The fair values disclosed in the above tables have been determined based on the following methodologies: (i) Cash and cash equivalents, trade and other receivables and trade and other payables are shortterm instruments in nature whose carrying value is equivalent to fair value. Trade and other payables exclude amounts provided for relating to annual leave, GST and wages accrual, which is outside the scope of AASB 139. (ii) For held-to-maturity assets the value of the term deposit on inception is used.

Note 22: Capital Management

Management ensures that the overall risk management strategy is in line with this objective. Management operates under policies approved by the Council of Management. There have been no changes to the strategy adopted by management to control the capital of the association since previous year.

Note 23: Reserves Asset Revaluation Reserve The asset revaluation reserve records the revaluation of non-current assets.

Management control the capital of the association to ensure that adequate cash flows are generated to fund its operations and that returns from investments are maximised.

34

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011


NOTES TO THE FINANCIAL STATEMENTS For the Year Ended 30 June 2011

Note 24: Association Details The principal place of business of the association is:

Master Buildersâ&#x20AC;&#x2122;Association of the ACT 1 Iron Knob Street FYSHWICK ACT 2609

Note 25: Prescribed Disclosure Under s272 (5) of the RAO Schedule As per s272(5) of the RAO Schedule (to the Workplace Relations Act 1996) the Association gives the following notice to its members: 1) A member of the Association, or a Registrar, may apply to the Association for specified prescribed information in relation to the Association under s272(1). 2) The Association shall, on application made under subsection 272(1) by a member of the Association or a Registrar, make specified information available to the member or Registrar in such manner, and within such time, as is prescribed under s272(2). 3) A Registrar may only make an application under subsection 272(1) at the request of a member of the Association, and the Registrar shall provide to a member information received because of an application made at the request of the member under s272(3).

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

35


FINANCIAL STATEMENTS

20 11

36

Master Builders Association of the ACT & Controlled Entity Annual Report - Year Ending June 30 2011

Master Builders Association of the ACT Financial Statements 2010-2011  

Master Builders Association of the ACT Financial Statements 2010-2011

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