Cranbourne Turf Club Annual Report 2009 - 10

Cranbourne Turf Club Inc Annual Report 2009/2010 Cranbourne Turf Club Inc Grant Street, Cranbourne 3977 Tel: (03) 5996 1300 Fax: (03) 5996 4972 Email: info@cranbourneturfclub.com.au www.cranbourneturfclub.com.au ABN: 72 001 641 203 – Annual Report 2009/2010

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Annual General Meeting The Annual General Meeting of the Cranbourne Turf Club Inc, will be held in the club buildings, Cranbourne Recreation Reserve on Wednesday 24 November 2010 @ 6.00pm.

BUSINESS 1.

Apologies

2.

Confirmation of Minutes of Annual General Meeting held on Wednesday 2 December 2009

3.

Chairman’s Report

4.

Treasurer’s Report

5.

To receive and adopt Financial Statement and Auditors Report for season 2009-2010

6.

To appoint Auditors for 2010-2011 season

7.

To elect three members to the committee

The following Members of Committee retire pursuant to the rules of the Cranbourne Turf Club and have re-nominated -:

Messrs: R Daley, G Sidwell & K McCormack

As no other nominations have been received, they will be duly elected.

NEIL BAINBRIDGE CHIEF EXECUTIVE OFFICER

– Annual Report 2009/2010

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Chairman’s Report across many areas, whilst the club partner. The new partnership with implemented numerous methods to Luxbet.com who is the corporate better manage costs. bookmaking arm of wagering operator Tabcorp will provide the club with a range of new opportunities and strong Conducting our second season of financial benefits. In partnership exclusive Sunday racing, the club with Luxbet.com, Tabcorp offered all again delivered an increase of 3% members of the club a free $60 Big6 in racing revenue. Whilst in isolation bet on Luxbet.com Cranbourne Cup not a significant figure, but when you day. This offer was very well received consider that corporate income through by our members and also provided a sponsorship sales and hospitality great incentive for new members to packages decreased year to year, it join our wonderful club. was a pleasing result.

I have great pleasure in presenting the Chairman’s Report for the 2009-2010 season. The 2009-2010 season was a challenging and difficult year for many businesses, including racing clubs.

The global financial crisis provided new challenges with businesses large and small feeling the strain. Despite the economic downturn, I am pleased to say that Cranbourne Turf Club’s racing activities again achieved growth

I would like to thank our members for their support of racing in Cranbourne and look forward to working with our members to continually improve their raceday experience. Membership of the club continues to be very strong and with high growth again achieved. The club now has 622 full members and a further 233 guest memberships taking This year we welcomed on board our financial membership contributions Luxbet.com as the clubs new principal to 855 at season end. The growing and Unfortunately TRIOS, our gaming venue returned a profit significantly below expectation resulting in the clubs distribution falling $120,859. This result and also a reduction in capital grants of $70,000 has seen the club post a loss of $64,670 for the season.

– Annual Report 2009/2010

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Chairman’s Report Cont... continued support from the Cranbourne and Casey community has come to the fore since the club moved to racing exclusively on Sunday’s, and with the region’s population increasing at a rapid rate our vision of 1,000 members will be achieved ahead of schedule.

The Club’s administration of the Cranbourne Training Complex on behalf of Racing Victoria continues to deliver great benefits for both the club and racing industry. The cooperative relationship provides an effective and efficient model with the sharing of resources across both sites. We are truly fortunate to have such a wonderful training facility here in Cranbourne that is unparalleled anywhere in Australia.

With horse numbers reaching 850 per day, its very easy to see how important the complex is not only to the Victorian racing industry, but also to the local community.

The 2009 Luxbet.com Cranbourne Cup was won by locally trained Sermon from the Robbie Laing stable, leading all the way in impressive style. This year we also launched the $1millon Luxbet.com Cranbourne Cup – Caulfield Cup bonus.

The bonus, created in partnership with Luxbet offers a $1million incentive to connections of a horse that can win both the Luxbet.com Cranbourne Cup and Caulfield Cup 6 days later. The bonus will be on offer for a further two years as we continue to build the profile of the Cranbourne Cup during the Spring Racing Carnival.

The success of the Cranbourne Turf Club would not be the same if it wasn’t for the generous support of our valued sponsors. I would like to sincerely say thank you to all sponsors that contribute to the success of racing in Cranbourne.

– Annual Report 2009/2010

To our premiership winners this season I congratulate you and also thank you for your support of racing at Cranbourne. Local trainer Michael Kent this season won his third straight trainers premiership. In addition to successfully defending his premiership, Michael was a great supporter of the club producing 117 starters over the 22 meetings. Brad Rawiller collected his first Cranbourne Jockeys Premiership whilst Michael Kent’s apprentice Adam McCabe won the Apprentice Jockeys Premiership.

Our committee has again been very dedicated to the task of ensuring that racing in Cranbourne continues to grow and prosper. We are committed to ensuring that the club has a strong and vibrant future and remains a leader in Country Victoria. Thank you to the committee for their hard work and in particular to my Vice-Chairmen Geoff Whiffin and Andrew Brumby who have 4

Chairman’s Report Cont. provided me with great support during Whilst its pleasing to look back at the the year. hard work and effort that everyone has The winter of 2010 has been widely contributed to make the 2009-2010 a regarded as one of the wettest in successful year, its also with a great recent years. The continued and heavy deal of enthusiasm that we look to rainfalls presented our track staff with the future and the opportunities that an extremely difficult task of producing lie ahead. The club has been working a high quality and safe racing surface hard with Racing Victoria and Country for the conduct of Victoria’s feature Racing Victoria to bring night racing to meetings every second Sunday. Their Cranbourne. Night Racing has long efforts have been outstanding and been a passion held by the committee I would like to thank our Tracks & and I am delighted with the recent Facilities Manager Simon Hodgson and news that the State Government, Racecourse Manager Benny Spierings Racing Victoria and Country Racing and their staff for ensuring the club Victoria have agreed to fund the didn’t lose a race meeting during that installation of lights at the Cranbourne Turf Club site with racing under lights period. to commence in October 2011. This is a great outcome for the club as night Cranbourne Turf Club has a strong and racing will provide the club with new proud history and continues to be a and exciting opportunities to further leader within Country Racing. I would grow participation and visitation. like to thank our administration team as they continue to put the club at the forefront, enhancing our reputation as I would like to thank the City of Casey for one of Victoria’s leading country clubs.

– Annual Report 2009/2010

their ongoing support of thoroughbred racing in Cranbourne. This support is invaluable as we continue to seek growth and investment in the states premier training centre to ensure that the region’s largest industry continues to thrive.

In closing I sincerely thank both Racing Victoria and Country Racing Victoria for their leadership and support of racing and training here in Cranbourne.

ROBIN DALEY CHAIRMAN

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Racing Report Our second year of racing exclusively on Sundays was again a great success for the club. Attendance levels were again very strong with the fast growing south eastern growth corridor supporting racing at Cranbourne.

Strong Sunday programs became a feature, along with large crowds and plenty of owners enjoying the convenience of Sunday racing and the close proximity of Cranbourne to the metropolitan region.

Racing was well supported across the season with strong racing and wagering results achieved.

Cranbourne again proved to be a popular launching pad for the stars of tomorrow with horses including Demerit, Linton, Roulettes and Willow Creek all winning their maiden this season at Cranbourne.

– Annual Report 2009/2010

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Racing Report Cont.

LUXBET.COM CRANBOURNE CUP Luxbet.com became the new sponsors of the Cranbourne Cup and introduced a $1mil bonus for the first time, available to any horse that could win both the Cranbourne Cup and Caulfield Cup the week later.

Whilst the bonus received a great deal of publicity, the winner of the Cranbourne Cup Sermon did not run in the Caulfield Cup. The $1mil bonus will continue to be offered as we continue to strive for new ways of making the Cranbourne Cup an even greater highlight on the Spring Racing Carnival calendar.

The Luxbet.com Cranbourne Cup provided a fantastic result for local trainer Robbie Laing as Sermon lead all the way in a run away victory. Sermon was perfectly rated in front by Mark Pegus saluting by an impressive 4 length margin.

– Annual Report 2009/2010

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Racing Report Cont.

PREMIERSHIPS Congratulations to our 2009-2010 premiership winners. Local Cranbourne trainer Michael Kent collected his third straight premiership with an impressive 18 wins and a further 30.5 placings. Michael is a great supporter of his home town track with 117 runners for the season. Michael also won $2,000 from major sponsor Luxbet.com in recognition of his achievement.

Brad Rawiller one of Australia’s leading jockey’s won his first ever Cranbourne jockeys premierships with 14 wins, whilst apprentice rider Adam McCabe won his first Cranbourne Apprentice Jockey’s Premiership.

Apprentice Jockey Wins A McCabe 5 J Noonan

4

N Rose 4 J Maskiell

3

B Knobel

3

Senior Jockeys Wins B Rawiller 14 M Allen 12 L Nolen

11

B J Melham

10

D Nikolic

9

Trainer Wins M Kent

18

P G Moody

13

J Moloney

6

P Snowden

5

R Douglas

5

– Annual Report 2009/2010

Seconds 3.5 3

0 3

2

Thirds 1 9

6 4

0

Starts 32 53

50 33

35

Strike Rate 16% 8% 8% 9% 9%

Seconds 13 6 7

13

8

Thirds 6 6 5.5

9

7

Starts 65 67 57

77

59

Strike Rate 22% 18% 19% 13% 15%

Seconds 16.5 4

3

3

3

Thirds 14

3.5

4

3

1

Starts 117

44

24

21

24

Strike Rate 15% 30% 25% 24% 21% 8

Treasurer’s Report The Cranbourne Turf Club recorded a loss for the 2009/10 financial year of $64,670, a $120,859 fall from last year’s profit. Although overall a disappointing result compared to last year, this fall can be attributed to $70,000 received last year from industry for capital works and a $127,756 drop in the profit share from TRIOS Tabaret & Bistro. TRIOS suffered a 7% drop in gaming commission during a year where spending on gaming fell approximately 5% across the state.

In what was a difficult year for country racing clubs, Cranbourne Turf Club managed a 3% increase in racing income. The major gain came from food & beverage where revenue was up 12%. The club has now managed all bars since 2006 and food since 2008. In this time food & beverage profit has more than tripled.

Admission, sponsorship and package income fell 1% from last year. This fall had been budgeted for due to the difficult economic conditions. The Club expects the 2010/11 season to grow beyond the 2008/09 levels.

– Annual Report 2009/2010

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Treasurer’s Report Cont.

The restructuring of the racecourse maintenance staffing in February 2009 reaped significant financial gains during last year. Total maintenance costs reduced by 29% on last year and are actually 36% less than five years ago. These costs savings have been achieved with no detrimental effect to the racecourse or facilities, with the track arguably in the best condition in years.

The Club’s catering department continues to grow, now catering for various Cranbourne Harness Club race meetings, as well as a number of large non race day functions. During the year the Club catered for over 500 people at an Australian Title Fight held outdoors in the betting ring. This follows the completion of the second year of catering for all Cranbourne Greyhound Club events. To highlight the significance of the catering department, over 120 food and beverage staff were employed by the Club on Cup day alone.

– Annual Report 2009/2010

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Treasurer’s Report Cont.

While the Club continues to explore new revenue earning opportunities, there are areas of the business that are much out of its control. Such an area is income from oncourse wagering, which for the fifth successive year has fallen. The fall over the past year was 8% and has now fallen $90,000 or 36% since 2004/05. Reasons for the fall is the reduction in commission rates paid by the industry, the abolition of commission paid on TRIOS turnover on race days as well as a general fall across the state due to the lifting of advertising bans on corporate bookmakers and the greater availability of other betting options.

Prizemoney and returns to owners of over $3.4 million was paid on races conducted at the Cranbourne Turf Club during 2009/10.

A record 5,050 owners attended meetings during the year. The prizemoney paid ranks the Cranbourne Turf Club as one of the top payers of prize money in country racing in Australia.

The 2010 income statement shows a reduction in Revenue by $3,341,575 and a reduction in – Annual Report 2009/2010

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Treasurer’s Report Cont. other expenses by $3,341,575. This is due to a policy change by Country Racing Victoria in relation to the treatment of prize money funding.

Despite the overall fall in operating profit for the year, the Cranbourne Turf Club has again achieved some significant financial improvements during the season. The strategies and changes implemented over the previous seasons places the Club in a strong financial position to remain at the forefront of country racing in Victoria.

SILVIO MARINELLI TREASURER

– Annual Report 2009/2010

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CRANBOURNE TURF CLUB INCORPORATED

STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 JULY 2010 Note Revenue

2

Employee benefits expense

2010 $

2009 $

2,366,602

5,654,111

(1,027,069)

(1,027,737)

Finance Costs

3

Depreciation and amortisation expense

3

(126,034)

(122,553)

Other expenses

3a

(1,278,170)

(4,447,631)

Profit / (Loss) before income tax

-

(64,670)

Income tax expense

1(a)

Profit / (Loss) from operations Other Comprehesive Income after income tax Total Comprehesive Income / (Loss) after income tax

-

-

56,189 -

(64,670)

56,189

52,552

53,418

(12,118)

109,607

The accompanying notes form part of this financial report – Annual Report 2009/2010

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CRANBOURNE TURF CLUB INCORPORATED

STATEMENT OF FINANCIAL POSITION AS AT 31 JULY 2010 Note

2010 $

2009 $

Current Assets Cash and Cash equivalents Trade and Other receivables Inventories Other Current Assets Total Current Assets

5 6 7 8

121,695 170,574 52,307 17,802 362,378

149,367 218,503 31,454 5,982 405,306

Non-Current Assets Financial Assets Property, plant and equipment Total Non-Current Assets

9 10

1,414,803 12,909,547 14,324,350

1,448,932 13,022,649 14,471,581

14,686,728

14,876,887

Total Assets Current Liabilities Trade and Other Payables Provisions Total Current Liabilities

11 12

263,042 104,532 367,574

348,730 74,544 423,274

Non-Current Liabilities Provisions Total Non-Current Liabilities

12

8,799 8,799

26,036 26,036

376,373

449,310

14,310,355

14,427,577

3,031,085 11,279,270 14,310,355

3,083,637 11,343,940 14,427,577

Total Liabilities Net Assets Equity Reserves Retained Earnings Total Equity

13

The accompanying notes form part of this financial report – Annual Report 2009/2010

14

CRANBOURNE TURF CLUB INCORPORATED

STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2010 Retained Earnings

Revaluation Surplus Reserve

Capital Grant Reserve

Total

2009 Balance at beginning of the financial year Profit/(loss) for the year Other comprehensive income / (expenses) Balance at end of the financial year

11,287,751 56,189 11,343,940

Retained Earnings

2,563,110 2,563,110 Revaluation Surplus Reserve

573,944 (53,418)

14,424,805 56,189 (53,418)

520,527

14,427,577

Capital Grant Reserve

Total

2010 Balance at beginning of the financial year Profit/(loss) for the year Other comprehensive income / (expenses) Balance at end of the financial year

11,343,940 (64,670) 11,279,270

2,563,110 2,563,110

520,527 (52,552)

14,427,577 (64,670) (52,552)

467,975

14,310,355

The accompanying notes form part of this financial report – Annual Report 2009/2010

15

CRANBOURNE TURF CLUB INCORPORATED

STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 JULY 2010

Cash Flows From Operating Activities

Note

Receipts from racing and gaming activities Operating grants received Payments to suppliers and employees Interest paid Interest received Distributions received from Joint Venture Net cash flows from / (used in) operating activities

2010 $ 2,228,753 (2,389,996) 6,463 192,592

17

2009 $ 5,244,591 70,000 (5,243,186) 5,617 200,000

37,812

277,022

Payments for property, plant and equipment Proceeds from sale of property, plant and equipment

(65,484) -

(271,097) 3,811

Net cash flows from/(used in) investing activities

(65,484)

(267,286)

Net increase/(decrease) in cash held

(27,672)

Cash at the beginning of the financial year

149,367

139,631

121,695

149,367

Cash Flows From Investing Activities

Cash at the end of the financial year

5

9,736

The accompanying notes form part of this financial report – Annual Report 2009/2010

16

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

NOTE 1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES The financial report covers Cranbourne Turf Club Inc as an individual entity. Cranbourne Turf Club Inc. is an association incorporated in Victoria under the Associations Incorporation Act (Victoria) 1981.

Basis of Preparation The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, Australian Accounting Interpretations, other authoritative pronouncements of the Australian Accounting Standards Board and the requirements of the Associations Incorporation Act (Victoria) 1981.

Australian Accounting Standards set out accounting policies that the AASB has concluded would result in a financial report containing relevant and reliable information about transactions, events and conditions to which they apply. Compliance with Australian Accounting Standards ensures that the financial statements and notes also comply with International Financial Reporting Standards. Material accounting policies adopted in the preparation of this financial report are presented below.

They have been consistently applied unless otherwise stated.

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, and financial assets and financial liabilities for which the fair value basis of accounting has been applied. (a) Income Tax Cranbourne Turf Club Inc. is exempt from income tax under Section 50-45 of the Income Tax Assessment Act 1997. (b) Inventories Inventories consist of food and beverages and are measured at the lower of cost and net realisable value.

Costs are assigned on a specific identification basis and include direct costs and appropriate overheads, if any. (c) Property, Plant and Equipment Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment losses.

Property Freehold land and buildings are shown at their fair value (being the amount for which an asset could be exchanged between knowledgeable willing parties in an arm's length transaction), based on periodic, but at lease triennial, valuations by external independent valuers, less subsequent depreciation for buildings.

Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset.

Plant and equipment Plant and equipment are measured on the cost basis less depreciation and impairment losses.

The carrying amount of plant and equipment is reviewed annually by the committee to ensure it is not in excess of the recoverable amount from these assets. The recoverable amount is assessed on the basis of the expected net cash flows that will be received from the assets' employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts.

The cost of fixed assets constructed within the club includes the cost of materials, direct labour, borrowing costs and an appropriate proportion of fixed and variable overheads.

Subsequent costs are included in the assets' 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 club and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Depreciation The depreciable amount of all fixed assets including building and capitalised lease assets, is depreciated on a straight-line basis over their useful lives to the club commencing from the time the asset is held ready 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: Class of Fixed Asset Leasehold Improvements Office Equipment Computer Equipment Motor vehicles Plant & equipment Fixtures & Fittings

Depreciation rate 2.50% to 10.0% 10.0% to 33.3% 33.33% 20.00% 10.00% to 33.3% 20.00% to 33.3% – Annual Report 2009/2010

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CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

The assets' residual values and useful lives are reviewed and adjusted, if appropriate, at each balance date.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the income statement. When revalued assets are sold, amounts included in the revaluation relating to that asset are transferred to retained earnings. (d) Financial Instruments Initial Recognition and Measurement Financial assets and financial liabilities are recognised when the entity becomes a party to the contractual provision to the instrument. For financial assets, this is equivalent to the date that the association commits itself to either purchase or sell the asset (i.e. trade date accounting is adopted) Financial instruments are initially measured at fair value plus transaction costs except where the instrument is classified at "fair value through profit and loss" in which case transaction costs are expensed to the profit and loss immediately Classification and subsequent measurement Finance instruments are subsequently measured at either 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 calculated as: (i) the amount at which the financial asset or financial liability is measured at initial recognition; (ii) less principal repayments; (iii) plus or minus the cumulative amortisation of the difference, if any, between the amount initially recognised and the maturity amount calculated using the effective interest method; and (iv) less any reduction for impairment.

The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that exactly discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability.

Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential recognition of an income or expense in profit or loss.

The group 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. Such assets are subsequently measured at fair value with changes in carrying value being included in profit or loss. The association has not held any financial assets at fair value through profit or loss in the current or comparative financial year. (ii) Loans and receivables 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. (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.

The association has not held any held-to-maturity investments in the current or comparative financial year. (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. (v) Financial liabilities Non-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost. – Annual Report 2009/2010

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CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

Impairment At each reporting date, 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 an impairment has arisen. Impairment losses are recognised in the income statement.

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 entity 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. (e) Impairment of Assets At each reporting date, the club reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset's fair value less costs to sell and value-in-use, is compared to the asset's carrying value. Any excess of the asset's carrying value over its recoverable amount is expensed to the income statement.

Where it is not possible to estimate the recoverable amount of an individual asset, the club estimates the recoverable amount of the cash-generating unit to which the asset belongs. (f) Employee Benefits Provision is made for the Club’s liability for employee benefits arising from services rendered by employees to balance date.

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, plus related on-costs. 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. These cashflows are discounted using market yields on national government bonds with terms to maturity that match the expected timing of cashflows.

(g) 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 on the balance sheet. (h) Revenue and Other Income 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 income 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.

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.

Interest revenue is recognised using the effective interest rate method, which, for floating rate financial assets is the rate inherent in the instrument. Dividend revenue is recognised when the right to receive a dividend has been established.

Revenue from the provision of memberships subscriptions is recognised on a straight-line basis over the financial year.

All revenue is stated net of the amount of goods and services tax (GST). (i) 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 Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows. (j) Comparative Figures When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year.

– Annual Report 2009/2010

19

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

NOTE 2. REVENUE AND OTHER INCOME Gaming revenue Grant Income Industry Prizemoney Funding Interest received Joint venture distributions Non raceday catering Other revenue Racing Income

2010 $

2009 $

155,204 72,520 6,463 3,259 300,971 87,898 1,740,289 2,366,602

282,960 70,000 3,345,724 5,617 9,997 143,195 80,923 1,715,694 5,654,111

Country Racing Victoria Ltd implemented a policy change from 1 August 2009 in relation to the treatment of prize money funding. The result is Industry Prizemoney Funding (Revenue) and Prize monies (Expense) will be netted off. The effect on the 2010 income statement is a reduction in Revenue by $3,341,575 and a reduction in Other expenses by $3,341,575 NOTE 3. EXPENSES Depreciation of non-current assets: Depreciation Finance costs (a) Other expenses Administration & Marketing Non raceday catering Racecourse maintenance Race day expenses & services Prize monies, trophies & other owners benefits

126,034

122,553

-

-

270,472 176,756 115,477 643,787 71,677 1,278,170

263,522 80,260 175,391 584,168 3,344,292 4,447,631

NOTE 4. AUDITORS' REMUNERATION Remuneration of the auditor of the Club for auditing or reviewing the financial report is payable by Racing Victoria Ltd NOTE 5. CASH AND CASH EQUIVALENTS Cash at bank Cash on hand Cash on deposit

8,011 1,829 111,855 121,695

95,575 400 53,392 149,367

118,402 118,402 52,172 170,574

96,090 96,090 122,414 218,503

The effective interest rate on short term bank deposits was 4.5% (2009 2.5%); these deposits have an average maturity of 30 days NOTE 6. TRADE AND OTHER RECEIVABLES Trade debtors Provision for impairment Sundry debtors

Current trade receivables are generally 30 day terms. These receivables are assessed for recoverability and a provision for impairment is recognised when there is an objective guidance that an individual trade receivable is impaired.

It is expected that all balances will be received when due Credit risk The club has no significant concentration of credit risk with respect to any single counterparty or group of counterparties other than those receivables specifically provided for and mentioned within note 6.

The following table details the entities receivables exposed to credit risk with ageing analysis and impairment provided for thereon. Amounts are considered "past due" when the debt has not been settled within the terms and conditions agreed between the club 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 club.

The balances of receivables that remain within initial terms (as detailed in the table) are considered to be of high credit quality

– Annual Report 2009/2010

20

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

2010 Trade debtors Sundry debtors Total

Gross Amount $ 118,402 52,172 170,574

2009 Trade debtors Sundry debtors Total

$ 96,090 122,414 218,503

Past due and impaired $ 0 0 0 $

0 0 0

< 30 $ 66,450 0 66,450

31 - 60 $ 17,745 0 17,745

61 - 90 $

$ 66,450 0 66,450

$ 17,745 0 17,745

$

The club does not hold any financial assets whose term have been negotiated but which would otherwise be past due or impaired.

Collateral held as security No collateral is held as security for any of the trade or other receivable balances NOTE 7. INVENTORIES Current At Cost - Stock of food and beverages NOTE 8. OTHER CURRENT ASSETS Prepayments NOTE 9. FINANCIAL ASSETS - NON CURRENT Investment in Radio Sport 927 at cost Investment in Cranbourne Racing Centre Joint Venture Investment in Trios Tabaret Joint Venture

0 0 0 0 0 0

2010 $

Within initial trade > 90 terms $ $ 11,895 0 0 52,172 11,895 52,172 $ 11,895 0 11,895

$

0 122,414 122,414

2009 $

52,307 52,307

31,454 31,454

17,802 17,802

5,982 5,982

82,450 103,774 1,228,579 1,414,803

82,450 100,515 1,265,967 1,448,932

11,481,858 (61,494) 11,420,364

11,481,858 (45,067) 11,436,792

14,057 (11,523) 2,534

14,057 (8,712) 5,345

15,887 (14,415) 1,472

15,887 (12,290) 3,597

33,400 (28,548) 4,852

33,400 (22,143) 11,257

636,791 (394,885) 241,906

615,098 (339,113) 275,985

491,374 (414,263) 77,111

488,824 (359,773) 129,051

66,189 (20,366) 45,823

44,018 (7,081) 36,937

1,090,774 (79,498) 1,011,276

1,090,774 (52,229) 1,038,545

NOTE 10. PROPERTY, PLANT AND EQUIPMENT Leasehold buildings & Improvements at Committee Valuation July 1997 At valuation Less accumulated amortisation Office Equipment At cost Less accumulated amortisation Computer Equipment At cost Less accumulated amortisation Motor Vehicles At cost Less accumulated amortisation Plant and equipment At cost Less accumulated depreciation Furniture and fittings At cost Less accumulated depreciation Catering Equipment At cost Less accumulated depreciation Industry Funded Assets At cost Less accumulated depreciation Work In Progress At cost Less accumulated depreciation Total written down amount

â&#x20AC;&#x201C; Annual Report 2009/2010

104,210 104,210

85,140 85,140

12,909,547

13,022,649 21

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

Movements in carrying amounts Leasehold buildings & Improvements at Committee Valuation July 1997 Carrying amount at beginning of year Additions Disposals Amortisation expense Carrying amount at end of year

2010 $

2009 $

11,436,792 (16,427) 11,420,364

11,405,778 47,136 (16,122) 11,436,792

Office Equipment Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

5,345 (2,811) 2,534

8,156 (2,811) 5,345

Computer Equipment Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

3,597 (2,125) 1,472

6,887 (3,290) 3,597

Motor Vehicles Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

11,257 (6,405) 4,852

25,698 (3,811) (10,630) 11,257

Plant and equipment at cost Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

275,985 21,693 (55,772) 241,906

228,510 104,789 (57,314) 275,985

Furniture and fittings Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

129,051 2,550 (54,490) 77,111

180,861 (51,810) 129,051

Catering Equipment Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

36,936 22,171 (13,285) 45,823

7,860 35,800 (6,724) 36,936

Industry Funded Assets Carrying amount at beginning of year Additions Disposals Depreciation expense Carrying amount at end of year

1,038,545 (27,269) 1,011,276

1,065,814 (27,269) 1,038,545

Work In Progress Carrying amount at beginning of year Additions Transfer to Assets Depreciation expense Carrying amount at end of year

85,140 19,070 104,210

Total written down amount â&#x20AC;&#x201C; Annual Report 2009/2010

12,909,547

1,768 85,140 (1,768) 85,140 13,022,649 22

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

NOTE 11. TRADE AND OTHER PAYABLES - CURRENT Trade creditors Sundry creditors Income in advance

NOTE 12. PROVISIONS Employee benefits Current Non Current

2010 $ 99,243 40,110 123,689 263,042

272,865 2009 $ 203,916 59,618 85,195 348,730

104,532 8,799 113,331

74,544 26,036 100,580

NOTE 13. RESERVES Revaluation Surplus The revaluation surplus reserve records revaluation of non current assets.

Capital Grant The capital grant reserve records receipt of capital funding from Racing Victoria Limited and Country Racing Victoria Limited prior to 1st August 2006.

NOTE 14. CONTINGENT LIABILITIES There were no contingent liabilities at the date of this report to affect the financial statements.

NOTE 15. RELATED PARTY TRANSACTIONS The names of persons who were members of the Committee at any time during the year were: Dr Sam Birman Garry Howe Paul Birman Silvio Marinelli Andrew Brumby Garry Sidwell David Cook Geoff Whiffin Robin Daley Chairman No remuneration or retirement benefits are payable as the positions are voluntary.

The following Committee members of the Club have received benefits from the business transactions arising in the ordinary course of the Club's business and conducted at ordinary commercial terms and conditions no more favourable than those it is reasonable to expect the Club would have adopted if dealing at arm's length in the same circumstances.

Committee Member Nil NOTE 16. KEY MANAGEMENT PERSONNEL COMPENSATION The totals of remuneration paid to key management personnel (KMP) of the Club during the year are as follows: Short-term employee benefits

2010 $ 229,173

2009 $ 255,972

8,011 1,829 111,855 121,695

95,575 400 53,392 149,367

Profit / (Loss) after income tax

(64,670)

56,189

Non cash items: Depreciation Amortisation Capital Funding reserve (Profit) / Loss on disposal of asset

178,585 (52,552) -

175,971 (53,418) -

Changes in assets and liabilities: (Increase) decrease in joint venture (Increase) decrease in receivables (Increase) decrease in inventories (Increase) decrease in prepayments Increase (decrease) in payables Increase (decrease) in provisions

34,129 47,929 (20,853) (11,820) (85,688) 12,751

(92,957) (35,686) (5,260) 6,807 237,816 (12,440)

37,812

277,022

NOTE 17. CASHFLOW INFORMATION (a) Reconciliation of cash Cash at bank Cash on hand Cash on deposit (b) Reconciliation of profit after tax to net cash from/(used in) operating activities

Net cashflows from / (used in) operating activities

â&#x20AC;&#x201C; Annual Report 2009/2010

23

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010

NOTE 18. FINANCIAL RISK MANAGEMENT

0

0

The Club's financial instruments consist mainly of deposits with banks, local money market instruments, short term investments, 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 as follows: 2010 $ Financial Assets Note Cash and cash equivalents 5 121,695 Loans and receivables 6 170,574 292,269 Financial Liabilities Financial Liabilities at amortised cost - trade and other payables 11 99,243 99,243

2009 $ 149,367 218,503 367,870

203,916 203,916

Financial Risk Management Policies The clubs treasurer is responsible for, among other issues, monitoring and managing financial risk exposures of the club.

The treasurer monitors the clubs transactions and reviews the effectiveness of controls relating to credit risk, financial risk and interest rate risk. Discussions on monitoring and managing financial risk exposures are held monthly and minuted by the committee.

The treasurer's overall risk management strategy seeks to ensure the club meets its financial targets, whilst minimising potential adverse effects of cashflow shortfalls. a) Interest rate risk The club is not exposed to any significant interest rate risk since cash balances are maintained at variable rates and borrowings of the club and are not considered significant. b) Liquidity risk Liquidity risk arises from the possibility that the club have difficulty settling its debts or otherwise meetings its obligations related to financial liabilities. The club manages this risk through the following mechanisms: - preparing forward looking cash flow analysis in relation to its operational, investing and financial activities; - only investing surplus cash with major financial institutions, and - proactively monitoring the recovery of unpaid income The tables below reflect an undiscounted contractual maturity analysis for financial liabilities Cash flows realised from financial assets reflect management's expectations as to the timing of realisation. Actual timing may therefore differ from that disclosed. The timing of cashflows presented in the table to settle finance leases reflect the earliest contractual settlement dates Financial liability and assets maturity analysis Financial liabilities due for payment Trade and Other Payables Total Contractual Outflows Total Expected Outflows

Within 1 year 2010 2009 $ $ 99,243 203,916 99,243 203,916 99,243 203,916

Financial assets - cash flows realisable Cash and cash equivalents Loans and receivables Available for sale financial assets Total Anticipated Inflows

121,695 170,574 0 292,269

149,367 218,503 0 367,870

Net (outflow)/inflow on financial instruments

193,026

163,954

1 to 5 years 2010 2009 $ $ 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0

Over 5 years 2010 2009 $ $ 0 0 0 0 0 0 0 0

0 0 0

Total 2010 $ 99,243 99,243 99,243

2009 $ 203,916 203,916 203,916

0 0 0 0

121,695 170,574 0 292,269

149,367 218,503 0 367,870

193,026

163,954

0

Financial assets pledged as collateral No financial assets have been pledged as security for any financial liability c) Foreign exchange risk The club is not exposed to fluctuations in foreign currencies

â&#x20AC;&#x201C; Annual Report 2009/2010

24

CRANBOURNE TURF CLUB INCORPORATED NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 JULY 2010 d) Credit risk Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract obligations that could lead to a financial loss of the club.

Credit risk is managed through maintaining procedures ensuring, to the extent possible, that members and counterparties to transactions are of sound credit worthiness. Subscriptions are expected to be paid prior to the commencement of the year.

Risk is also minimised through investing surplus funds in financial institutions that maintain a high credit rating or in entities that the committee has otherwise cleared as financially sound.

Credit risk exposures The maximum exposure to credit risk by class of recognised financial assets at balance date is equivalent to the carrying value and classification of those financial assets (net of any provisions) as presented in in the balance sheet.

There is no collateral held by the club securing trade and other receivables The club has no significant concentration of credit risk with any single counterparty or group of counterparties. Details with respect to credit risk of trade and other receivables is contained in note 6.

Trade and other receivables that are neither past due or impaired are considered to be of high credit quality. Aggregate of such amounts are contained in note 6. e) Price risk Price risk relates to the risk that the fair value of future cashflows of a financial instrument will fluctuate because of changes in market prices largely due to demand and supply factors of commodities Net Fair Values The fair values of financial assets and financial liabilities are identical to their carrying values as disclosed in the Balance Sheet. Fair values are those amounts at which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties, in arms length transaction. Where possible, valuation information used to calculate fair value is extracted from the market, with more information available from markets that are actively traded.

Sensitivity Analysis The Club has performed a sensitivity analysis relating to its exposure to interest rate risk at balance date. This sensitivity analysis demonstrates the effect on current year results and equity which could result from a change in risk.

As at 31 July 2010, the effect on profit and equity as a result as a result of changes in the interest rate, with all other variables remaining constant would be as follows: Movement in Interest Rate 0% 1%

-4%

-3%

-2%

-1%

Change in profit: 2010 2009

(4,868) (5,975)

(3,651) (4,481)

(2,434) (2,987)

(1,217) (1,494)

-

Change in equity: 2010 2009

(4,868) (5,975)

(3,651) (4,481)

(2,434) (2,987)

(1,217) (1,494)

-

2%

3%

4%

1,217 1,494

2,434 2,987

3,651 4,481

4,868 5,975

1,217 1,494

2,434 2,987

3,651 4,481

4,868 5,975

(e) Capital Management The committee members control the capital of the Club in order to maintain a good debt-to-equity ratio and to ensure that the Club can fund its operations and continue as a going concern.

No capital management issues have been noted during the financial year.

NOTE 19. CLUB DETAILS The registered office and principal place of business is Grant Street, Cranbourne Vic 3977 NOTE 20. SEGMENT REPORTING The club operates in the thoroughbred racing sector in Victoria.

â&#x20AC;&#x201C; Annual Report 2009/2010

25

CRANBOURNE TURF CLUB INCORPORATED

STATEMENT BY MEMBERS OF THE COMMITTEE

In the opinion of the committee the financial report as set out in pages 1 to 13 1

Presents a true and fair view of the financial position of the Cranbourne Turf Club Inc. as at 31 July 2010 and its performance for the year ended on that date in accordance with Australian Accounting Standards, (including Australian Accounting Interpretations) of the Australian Accounting Standards Board.

2

At the date of this statement, there are reasonable grounds to believe that Cranbourne Turf Club inc. will be able to pay its debts as and when they fall due.

This statement is made in accordance with a resolution of the committee and is signed for and on behalf of the Committee by:

Chairman …………………………………………

Robin Daley

Treasurer …………………………………………

Silvio Marinelli Dated this 19th

day of

October 2010

– Annual Report 2009/2010

26

â&#x20AC;&#x201C; Annual Report 2009/2010

27

â&#x20AC;&#x201C; Annual Report 2009/2010

28