2019 Financial Report

SYDNEY DANCE COMPANY

SYDNEY DANCE COMPANY ABN 59 002 707 897

GENERAL PURPOSE (RDR) FINANCIAL REPORT For the year ended 31 December 2019

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SYDNEY DANCE COMPANY

Contents Directors' report ................................................................................................................................... 3 Auditor's independence declaration to the directors of Sydney Dance Company .............................. 8 Statement of profit or loss and other comprehensive income ............................................................ 9 Statement of financial position .......................................................................................................... 10 Statement of changes in equity ......................................................................................................... 11 Statement of cash flows .................................................................................................................... 12 Notes to the financial statements ...................................................................................................... 13 Directors' declaration ........................................................................................................................ 31 Declaration by Chairperson as required by the Charitable Fundraising Act 1991 (NSW) ......... 32 Independent Auditor's Report ......................................................................................................... 33

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SYDNEY DANCE COMPANY

Directors' report Your directors submit their report on Sydney Dance Company (the "Company") for the year ended 31 December 2019.

DIRECTORS The names of Company's directors in office during the financial year and their qualifications and expertise are set out below. Directors were in office for this entire period, unless otherwise stated.

Brett Clegg, GAICD, BBus MCom (Advanced Finance) Chair, appointed 23 March 2015 Mr Clegg was appointed Chair on 12 August 2019. Mr Clegg is an adviser to chief executives and boards, specialising in strategic communications, issues management, innovation and capital markets transactions.

His career has spanned professional services, investment banking, publishing and the technology sectors.

Brett is an ambassador for the Australian Indigenous Education Foundation, a former Director of HiPages Group and a former Council Member of the University of Technology Sydney. His expertise relates to corporate strategy, media and technology, finance, fundraising and corporate contacts.

Pamela Bartlett, appointed 31 August 2012 Ms Bartlett was a founding member of The Marmalade Foundation, operating and funding Lou’s Place, a safe place for women. With over 20 years corporate experience with American Express her expertise is in the areas of operational management, customer service, quality assurance, marketing and fundraising.

David Baxby, MAICD, BCom, BLaw (Hons), appointed 12 August 2019 Mr Baxby has held the role of Managing Director, Wesfarmers Industrials since August 2017. Prior to this, David held a number of commercial and leadership roles within the Virgin Group, the last being Global CoCEO. David also served as President and CEO of Global Blue, the international shopping transaction processing business. His past Directorships include Virgin Australia, Frontier Digital Holdings, Virgin Atlantic Ltd, Virgin Holidays Ltd, Virgin America Inc and Air Asia X. David was a Partner and Executive Director of Goldman Sachs in both London and Sydney. Mr Baxby’s expertise is in the areas of operational management, finance, strategic management and corporate contacts. David currently sits on the Council of Bond University.

Jillian Broadbent AC, BA (Maths & Economics), appointed 15 March 2018 Ms Broadbent is Chair of Swiss Re Life and Health Australia Limited, Chancellor of the University of Wollongong and a Director of Woolworths Limited, Macquarie Group Limited, and the National Portrait Gallery of Australia. Ms Broadbent was previously the inaugural Chair of the Clean Energy Finance Corporation and a member of the Board of the Reserve Bank of Australia. Ms Broadbent has expertise in the areas of finance, strategic management and corporate governance.

David Friedlander, BCom, Master of Laws, MAICD, appointed 14 October 2019 Mr Friedlander is a Partner and Head of Public M&A at King Wood & Mallesons. Mr Friedlander is a member of the New York State Bar Association – International and Business Law Section, the Law Council – Corporations Committee, the Australian Institute of Company Directors – Law Committee and of the International Bar Association. He is Chairman of the Public Education Foundation and a Lecturer in Takeovers and Hybrid Securities at the University of Sydney. He was previously a member of the Australian Takeovers Panel. Mr Friedlander has expertise in law, capital markets transactions, board governance, and corporate networks.

Mark Hassell, appointed 31 January 2017 Mr Hassell is a Partner at KPMG Australia in the Customer, Brand and Marketing, Management Consulting Practice. Prior to this Mark was Group Executive/Chief Customer Officer at Virgin Australia airlines leading the Customer and Brand transformation from the low-cost Virgin Blue airlines. Mark has previously held

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SYDNEY DANCE COMPANY

several senior management positions in his field at British Airways and Qantas including Global Head of Customer Experience at British Airways based in London. As well as the experience he brings to the Board, Mark also chairs the Marketing and Commercial Activities Sub-Committee.

Sandra McCullagh, GAICD, MBA, BA (Computer Science), BSc (Computer Science and Maths), appointed 12 August 2019 Ms McCullagh is a Trustee of QSuper, the $100bn superannuation fund, and Chair of Clayfield College, a K12 independent school in Brisbane. Ms McCullagh is also a member of the Queensland Government’s Climate Advisory Council and is on the Management Committee of the Investor Group on Climate Change.

She is the Principal and Director of About Energy, a consulting firm in the areas of energy, environment, social and governance issues. Ms McCullagh was previously both a Director - Equities Research, and Head of Environmental, Social & Governance Equities Research at Credit Suisse, and has held senior positions at several energy companies. Ms McCullagh’s expertise is in the areas of finance, strategy and corporate governance.

Catriona Mordant AM, appointed 22 November 2016 Ms Mordant is a foundation Board Member of the Museum of Contemporary Art Australia, a Director of the International Council of the Tate in London and a Member of the advisory board of Venetian Heritage in Venice.

Ms Mordant has expertise in fundraising, strategic management and corporate contacts.

Paris Neilson, BA, MMS, appointed 12 August 2019 Ms Neilson is a Director of the Biennale of Sydney and the chair of its Development committee and former member of the Artistic Director selection committee. She is also a Director of the Chain Reaction Foundation and a Trustee of the Neilson Foundation. Ms Neilson has expertise in arts organisations and the philanthropic sector.

Emma-Jane Newton, MAICD, BCom (Hons), appointed 30 April 2018 Ms Newton is a Managing Director in the Investment Banking Division of Morgan Stanley and was previously an Executive Director at Telstra in senior finance roles. Prior to joining Telstra she was a Managing Director at Credit Suisse. Ms Newton has expertise in finance, strategy, and corporate development. Emma-Jane has chaired the Audit and Risk Committee since June 2019.

Chrissy Sharp, BA hons, appointed 5 December 2016 Ms Sharp is the CEO of the Sydney Writers’ Festival and was previously Acting Executive Director (maternity cover) at Sydney Dance Company in 2016. Ms Sharp was previously Chair of the Dance Board of the Australia Council for the Arts, the inaugural Director of Melbourne’s Wheeler Centre for Books Writing and Ideas, General Manager of Sadler’s Wells theatres in London, General Manager of the Sydney Festival and Head of Policy at SBS. Ms Sharp has expertise in arts management, strategic analysis and government relations.

Carla Zampatti AC, appointed 22 October 2012 Ms Zampatti is the Executive Chair of Carla Zampatti Pty Ltd and a Board Member of the European Australian Business Council. Ms Zampatti was previously Chair of SBS Corporation, a Trustee of the Art Gallery of NSW and a Director of Australian Multicultural Foundation, MCA Foundation, UTS V-C’s Industry Advisory Board, Westfield Holdings, McDonalds and the Sydney Theatre Company Foundation. In 2004, the Italian government appointed Ms Zampatti Commendatore (Commander) in the Order of Merit of the Italian Republic. She has received awards for her work in Australian fashion and design, including the Australian Fashion Laureate in 2008.

Peter Brownie, BEc, appointed 20 August 2012, resigned 3 June 2019 Mr Brownie has a 25-year background in investment banking and corporate advisory services, previously holding senior positions within Luminus Partners, Morgan Stanley and ABN AMRO/BZW. Mr Brownie has experience in finance, strategy and corporate governance.

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SYDNEY DANCE COMPANY

Kiera Grant, FAICD, BEc, appointed 23 April 2013, resigned 2 December 2019 Ms Grant is Non-Executive Director of Adairs Ltd, Samuel Smith and Sons (incorporating Yalumba Wines and Negociants Limited) and Future Generation Global. She is Chairman and Trustee of the Art Gallery of NSW Foundation. Ms Grant is a former Non-Executive Director of Pacific Brands Ltd and former Executive Director of UBS Australia. Her expertise is in finance, strategic management, corporate governance and corporate contacts.

Karen Moses (Chair), BEc, Dip Ed, appointed 14 May 2012, resigned 12 August 2019 Ms Moses is a Chair of the NSW Artform Board for Dance and Physical Theatre, a Director of Charter Hall Group, Orica Limited, Boral Limited and Sydney Symphony Limited, and is a Fellow to the Senate of Sydney University. Karen is a former Director of SAS Trustee Corporation, Origin Group companies, Contact Energy Limited and the Australian Energy Market Operator. Karen has over 30 years’ experience as an executive in the energy industry and has expertise in the areas of finance, strategic management and corporate governance.

Beau Neilson, BLaws, appointed 23 March 2015, resigned 29 April 2019 Ms Neilson is an Advisory Board Member of Anti-Slavery Australia and a Member of the Gifting Committee of The Neilson Foundation. Ms Neilson has expertise in philanthropy, events and relationship management.

Board Meetings The number of meetings of directors held during the year and the number of meetings attended by each Director were as follows; Board Meetings Eligible

Attended

Brett Clegg (Chair)

7

7

Pamela Bartlett David Baxby – appointed 12/8/19 Jillian Broadbent AC David Friedlander – appointed 14/10/19 Mark Hassell Sandra McCullagh – appointed 12/8/19 Catriona Mordant AM Paris Neilson – appointed 12/8/19 Emma-Jane Newton Chrissy Sharp Carla Zampatti AC Peter Brownie – resigned 03/6/19 Kiera Grant – resigned 02/12/19 Karen Moses (Chair) – resigned 12/8/19 Beau Neilson – resigned 29/4/19

7 3 7 2 7 3 7 3 7 7 7 4 6 5 3

5 2 3 1 7 2 5 3 6 5 5 3 6 5 3

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SYDNEY DANCE COMPANY

PRINCIPAL ACTIVITIES The principal activities during the year were as follows:  Production and presentation of dance performances in Australia and overseas  Promotion and the study of dance  Commercial activities to provide financial support for the above including daily dance classes, school holiday workshops and dance studio hire  Fundraising to support production, promotion and presentation of dance performances in Australia and internationally There have been no significant changes in the nature of these activities during the year.

SIGNIFICANT EVENTS AFTER YEAR END Subsequent to 31 December 2019, the COVID-19 outbreak was declared a pandemic by the World Health Organization in March 2020.

The pandemic has resulted in the closure of the Company’s dance studios since 18th March 2020 and the cancellation of all scheduled performances since 13th March 2020; NSW Government Public Health COVID-19 Restrictions Orders currently prevent any resumption of performances and dance classes in the studios. The Directors acknowledge that due to the evolving nature of the pandemic there is currently a material uncertainty as to when performances and dance classes in the Company’s studios will be able to recommence and under what Government imposed conditions. The cancellation of performances and dance classes in the Company’s dance studios has to date and will result in a reduction in revenue and operating cashflows which is expected to reduce the operating result for the year ended 31 December 2020. Management have put in place a number of initiatives to reduce costs where possible and obtain additional government support, while protecting the integrity of the Company.

To the extent the duration of the COVID-19 pandemic and its impact on the Company is significantly greater than anticipated by the Directors, significant uncertainty exists surrounding the Company’s ability to continue as a going concern. No adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not be able to continue as a going concern.

OBJECTIVES and RESULTS Across 2019 Sydney Dance Company operated out of temporary studios in Ultimo as worked continued work on the redevelopment of its permanent home in Walsh Bay. Despite this disruption, Sydney Dance Company delivered 73 performances reaching an audience of over 38 600 people and a further 78 200 attendees to its open class program and over 12 000 young people engaged through the school performance and workshops programs. The Pre-professional year (PPY) delivered its 6th cohort of graduating students and the program continues to go from strength to strength.

2019 was Sydney Dance Company’s 50th anniversary year and the Company delivered a diverse program of activities both on stage and off. Across the year Sydney Dance Company commissioned 10 new works, accompanied by 10 new music commissions. The Company produced a short film celebrating the history of the company and commissioned a web series called 50 Years, 50 Memories recalling anecdotes and moments from across the Company’s history. The company delivered an International tour taking in Poland, Austria, Finland and Spain and a national tour taking in Melbourne, Canberra, Hobart, Adelaide and Darwin as well as regional centres in Victoria, South Australia and the Northern Territory.

Across the year Sydney Dance Company employed 154 staff and contractors, with 73% of them being artists or production workers. We maintained a full-time ensemble of 17 dancers and employed an additional 10 alumni dancers from across the Company’s 5 decades.

The financial accounts for 2019 show a surplus result of $825 139 and total revenue of $11,965 879. This healthy surplus is a result of the increase in development income for the Capital Campaign. As Sydney Dance Company moves forward with detailed plans for the building works, the challenges of working in temporary locations spread across three sites are being effectively managed and the company is looking forward to returning to Walsh Bay in late 2020.

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SYDNEY DANCE COMPANY

The annual surplus consists of an operating surplus of $10,850, calculated after funding the $744,139 impact-ofdisruption costs on the base operating deficit result of -$733,289. The aforementioned impact-of-disruption costs are funded from the Infrastructure Project gross surplus of $1,558,428, leaving an Infrastructure Project net surplus of $814,289. Total income for the period is $11,965,879. This amount is made up of operational income of $10,227,488 and Infrastructure related income of $1,738,391 from donations. Expenses for the year total $11,140,740. This consists of $10,960,777 of operational expenses and $179,963 of Infrastructure Project related expenses. The surplus for the year ended 31 December 2019 was $825,139 (2018: $235,261). There were no significant changes in the state of affairs of the Company during the year.

MEMBER'S GUARANTEE The Company is a public company limited by guarantee that is incorporated and domiciled in Australia. If the Company is wound up, its Constitution states that each member is required to contribute a maximum of $100 each towards meeting any outstanding obligations of the Company, a total of $1,500 as at 31 December 2019.

At 31 December 2019, the number of members was 15 (2018: 15 members).

INDEMNIFICATION AND INSURANCE OF DIRECTORS AND OFFICERS Since the end of the previous financial year, the Company has not indemnified or made a relevant agreement for indemnifying against a liability of any person who is or has been an officer or auditor of the Company.

Since the end of the previous financial year, the Company has paid premiums in respect of directors’ and officers’ liability and legal expenses insurance contracts. These insurance contracts insure against liability (subject to specific exclusions) for persons who are or have been directors or officers of the Company.

The Directors have not included details of the nature of the liabilities covered nor the amount of the premium paid in respect of the directors’ and officers’ liability and legal expenses’ insurance contracts, as such disclosure is prohibited under the terms of the contract.

INDEMNIFICATION OF AUDITOR To the extent permitted by law, the Company has agreed to indemnify its auditor, Ernst & Young (Australia), as part of the terms of its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No payment has been made to indemnify Ernst & Young (Australia) during or since the financial year.

AUDITOR INDEPENDENCE The directors received an independence declaration from the auditor of Sydney Dance Company. A copy has been included in this report.

Signed in accordance with a resolution of the directors.

Brett Clegg Chair Sydney, 25 May 2020

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Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

Auditor’s Independence Declaration to the Directors of Sydney Dance Company In relation to our audit of the financial report of Sydney Dance Company for the financial year ended 31 December 2019, and in accordance with the requirements of Subdivision 60-C of the Australian Charities and Not-for profits Commission Act 2012, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of any applicable code of professional conduct.

Ernst & Young

Lisa Nijssen-Smith Partner 25 May 2020

8 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

SYDNEY DANCE COMPANY

Statement of profit or loss and other comprehensive income For the year ended 31 December 2019 Notes

2019 $ 11,932,257 33,622 11,965,879

2018 $ 12,383,669 78,463 12,462,132

(6,540,373) (2,627,718) (865,027) (797,213) (16,708) (283,445) (10,256) (11,140,740)

(7,389,243) (2,904,725) (975,403) (651,347) (46,868) (241,285) (12,208,871)

Operating surplus for the year

825,139

253,261

Other comprehensive income Total comprehensive income for the year

825,139

253,261

Revenue Other income Total Revenue Administration and marketing expenses including staff costs Performance and production expenses Commercial activity related costs Philanthropy activity related costs Sponsorship activity related costs Education costs Lease finance costs Total Expenses

3(a) 3(c)

The above statement of profit or loss and other comprehensive income should be read in conjunction with the accompanying notes.

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SYDNEY DANCE COMPANY

Statement of financial position As at 31 December 2019 Notes Assets Current Assets Cash and short-term deposits Trade and other receivables Inventories Other assets Total current assets Non-current assets Right-of-Use Assets Property, plant and equipment Reserve incentive scheme Total non-current assets Total assets Liabilities Current Liabilities Trade and other payables Deferred revenue Employee benefit liabilities Government grant advances Lease Liabilities Total current liabilities Non-current liabilities Employee benefit liabilities Lease Liabilities Total non-current liabilities Total liabilities

2019 $

2018 $

5 6 7

5,049,048 345,696 33,685 5,428,429

3,420,568 374,489 30,955 1,528 3,827,539

8 9 10

114,698 103,174 567,456 785,328 6,213,757

125,361 558,339 683,700 4,511,239

11 12 13 14 15

556,653 470,569 388,838 817,502 109,380 2,342,942

516,716 482,778 360,370 131,828 1,491,692

13 15

40,903 8,867 49,770 2,392,712

26,807 26,807 1,518,499

3,821,045

2,992,740

524 840,333 567,456 230,833 2,181,899 3,821,045

524 810,185 558,339 256,082 1,367,610 2,992,740

Net assets Equity Contributed equity Retained earnings Reserve incentive scheme Hepzibah Tintner artist development fund Capital reserve Total equity

16 17 17 17

The above statement of financial position should be read in conjunction with the accompanying notes.

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SYDNEY DANCE COMPANY

Statement of changes in equity For the year ended 31 December 2019

At 1 January 2018 Surplus for the year Total comprehensive income for the year Transfer to capital reserves Transfer to reserve incentive scheme Transfer to Hepzibah Tintner artist development fund Transfer from capital reserve At 31 December 2018 Impact of change in accounting standards 1 Adjusted Balance at 1 January 2019 Surplus for the year Total comprehensive income for the year Transfer to capital reserve Transfer to reserve incentive scheme Transfer from Hepzibah Tintner artist development fund Transfer from capital reserve At 31 December 2019

Hepzibah Tintner Artist Development Fund (Note 17)

Total Equity

Contributed equity (Note 16)

Retained Earnings

Capital Reserve (Note 17)

Reserve Incentive scheme (Note 17)

$

$

$

$

$

$

524

1,058,382

1,129,826

550,747

-

2,739,479

-

253,261

-

-

-

253,261

-

253,261

-

-

-

253,261

-

(1,036,179)

1,036,179

-

-

-

-

(7,592)

-

7,592

-

-

-

(256,082)

-

-

256,082

-

524

798,395 810,185

(798,395) 1,367,610

558,339

256,082

2,992,740

-

3,166

-

-

-

3,166

524

813,351

1,367,610

558,339

256,082

2,995,906

-

825,139

-

-

-

825,139

-

825,139

-

-

-

825,139

-

(1,558,428)

1,558,428

-

-

-

-

(9,117)

-

9,117

-

-

-

25,249

-

-

(25,249)

-

-

744,139

(744,139)

-

-

-

524

840,333

2,181,899

567,456

230,833

3,821,045

1

From 1 January 2019 the Company adopted AASB 16 Leases. Refer note 18.

The above statement of changes in equity should be read in conjunction with the accompanying notes.

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SYDNEY DANCE COMPANY

Statement of cash flows For the year ended 31 December 2019 Notes Operating activities Receipts from activities Payments to suppliers and employees Payments for short term and low value leased assets Receipt of government grants Interest received Interest payments on leases Net cash flows from operating activities Investing activities Purchase of property, plant and equipment Net cash flows used in investing activities

9

Financing activities Lease Liability principal payments Net cash flows used in financing activities Net increase in cash and cash equivalents Cash and cash equivalents at the beginning of year Cash and cash equivalents at the end of year

5

2019 $

2018 $

7,653,667 (10,607,213) (270,917) 4,960,320 23,806 (10,256) 1,749,407

8,615,466 (11,461,518) 3,201,585 23,441 378,974

(31,212) (31,212)

(96,200) (96,200)

(89,715) (89,715)

-

1,628,480 3,420,568 5,049,048

282,774 3,137,794 3,420,568

The above statement of cash flows should be read in conjunction with the accompanying notes.

The above statement shows cashflow exclusive of reserves held under the reserve incentive scheme.

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SYDNEY DANCE COMPANY

Notes to the financial statements For the year ended 31 December 2019 1

OVERVIEW

The general purpose financial statements of the Company for the year ended 31 December 2019 were authorised for issue in accordance with a resolution of the directors on 25 May 2020.

Sydney Dance Company is a not for profit company, limited by guarantee. The registered office and principal place of business of the Company is: The Wharf, Pier 4, Hickson Road, Walsh Bay, NSW 2000.

The nature of the operations and principal activities of the Company are described in the Directors’ Report.

The Company is exempted from income tax by virtue of section 50-5 of the Income Tax Assessment Act, 1997.

The financial statements: • have been prepared in accordance with the requirements of the Australian Charities and Not-for-Profit Commission Act 2012, Australian Accounting Standards – Reduced Disclosure Requirements and other authoritative pronouncements of the Australian Accounting Standards Board • have been prepared on a historical cost basis • are presented in Australian dollars ($) • present reclassified comparative figures where required to conform with changes in presentation in the current year • adopt AASB 15 – Revenue from Contracts and AASB 1058 – Income of Not for Profit Entities for the first time. The adoption of these standards has not had a material impact on the financial statements.

The accounting policies applicable to revenue are included in note 3 • adopt AASB 16 – Leases for the first time using the modified retrospective approach. This has resulted in the recognition of Right-of-Use Assets of $211,128 and Lease Liabilities of $207,962, and a $3,166 increase in opening retained earnings as at 1 January 2019. The impact of the first-time application of this standard has been included in note 18.

Going concern and material uncertainty The financial statements have been prepared on a going concern basis which assumes the Company will be able to pay its debts as and when they become payable for a period of at least 12 months from the date of the financial report.

The Company generated a profit for the year of $825,139 (2018: $253,261), and at year end had a surplus of net assets of $3,821,045 (2018: $2,992,740) and net current assets of $3,085,487 (2018: $2,335,845). The Company generated net cash inflows from operating activities of $1,749,407 (2018: $378,974). The Company does not have any bank or other external debt.

The ability of the Company to maintain its operations is dependent inter alia on the continuing support of various Governments by way of grants. The Tripartite Agreement is current for the period 2019-2021 with the Australia Council for the Arts and Create NSW, subject to the Company continuing to meet the requirements of the Tripartite Agreement.

The Company’s Directors have undertaken a thorough assessment of going concern; this review considered the operating budgets and detailed cash flow for the Company for the period 12 months from the date of these financial statements. This assessment includes consideration of the significant matter described in note 21 of the financial report.

Note 21 “Events after the reporting period” refers to the COVID-19 outbreak being declared a pandemic by the World Health Organisation subsequent to 31 December 2019. The pandemic has resulted in the closure of the Company’s dance studios since 18 March 2020 and the cancellation of all scheduled performances since 13 March 2020; NSW Government Public Health COVID-19 Restrictions Orders currently prevent any resumption of performances and dance classes in the studios. The Directors acknowledge that due to the evolving nature of the pandemic there is currently a material uncertainty as to when performances and dance classes in the Company’s studios will be able to recommence and under what Government imposed conditions. The cancellation of performances and dance classes in the Company’s dance studios has to date and will result in a reduction in revenue and operating cashflows

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SYDNEY DANCE COMPANY

which is expected to reduce the operating result for the year ended 31 December 2020. Management have put in place a number of initiatives to reduce costs where possible and obtain additional government support, while protecting the integrity of the Company.

To the extent the duration of the COVID-19 pandemic and its impact on the Company is significantly greater than anticipated by the Directors, significant uncertainty exists surrounding the Company’s ability to continue as a going concern. No adjustments have been made relating to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company not be able to continue as a going concern.

2

SIGNIFICANT ACCOUNTING JUDGEMENTS, ESTIMATES AND ASSUMPTIONS The preparation of the Company’s financial statements requires management to make judgements, estimates and assumptions that affect the reported amounts of revenues, expenses, assets and liabilities, and the accompanying disclosures, and the disclosure of contingent liabilities. Judgements and estimates which are material to the financial statements are found in the notes to the financial statements.

The Company based its assumptions and estimates on information which was available at the time the financial statements were prepared. These assumptions and estimates about future developments may change due to market changes or circumstances arising beyond the control of the Company.

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3

REVENUE AND EXPENSES (a)

Revenue

Box office and fees Sponsorship - cash Sponsorship in-kind Fundraising Capital campaign contribution Commercial revenue Education revenue Government grants - cash (Note 3(b)) Government grants in-kind rental (Note 3(b)) Total revenue

2019 $ 1,443,287 16,000 713,840 2,418,873 1,738,391 1,778,354 414,632 3,408,880 11,932,257

2018 $ 1,488,180 206,285 629,193 2,005,605 1,495,200 1,799,030 360,162 3,462,077 937,937 12,383,669

AASB 15 Revenue from Contracts with Customers (“AASB 15”) and AASB 1058 Income of Not-for-Profit Entities (“AASB 1058”) are new standards which have both been adopted from 1 January 2019. The application of AABS 15 and 1058 did not have any material impact on the financial statements of the Company.

In adopting AASB 15 as at 1 January 2019, the Company has elected to apply the modified retrospective method which adjusted only the current reporting period for the requirements of the new standard. AASB 15 applies to all revenue arising from contracts with customers, unless those contracts are in the scope of other standards. Under AASB 15, revenue is recognised when a performance obligation has been satisfied at an amount that reflects the consideration to which an entity expects to be entitled in exchange for transferring goods or services to a customer. The standard requires entities to exercise judgment, taking into consideration all the relevant facts and circumstances when applying the requirements of the standard to contracts with their customers.

In adopting the standard the Company has reviewed its revenue streams to identify all performance obligations under each contract and the point in time or period of time over which these obligations are fulfilled. As each performance obligation is met, revenue which relates specifically to the performance of that obligation is recognized. There were no material changes from the Company’s existing revenue recognition practices required.

AASB 1058 simplifies the income recognition requirements that apply to not-for-profit entities, in conjunction with AASB 15 Revenue from Contracts with Customers. It provides for immediate recognition of income where an arrangement does not impose any specific future obligations on the Company in order to become entitled to the income.

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SYDNEY DANCE COMPANY

The specific performance obligation for recognition of each revenue stream is noted below Revenue

Significant Payment Terms In advance

Performance Obligations

Fundraising and Sponsorship

In advance

Education

In advance

Sponsorship in Kind

Not applicable

Commercial Dance Class

In advance

School Holiday Workshops

In advance

On receipt where unconditional/non-reciprocal, or on delivery of event or project where sufficiently specific performance obligations are included in the contract Point in time - Provision of education experience Point in time or over a period depending on the nature of the in-kind A corresponding expense is recorded at the time that revenue is recognised.

Dance classes – point in time Membership – period of time – membership period Merchandise – point in time - sale Over a period of time - Delivery of workshop

Box Office – including ticket sales

Ticket Sales - point in time - Delivery of performance

The Company’s refund policies are as follows; Box Office - a refund is provided to customers where the performance is cancelled, rescheduled or relocated prior to the event. To the extent that a performance is cancelled during its course, a ticketholder may be eligible for a full or partial refund depending upon the circumstances which caused the cancellation.

Dance Classes – Dance class purchases are non-refundable and non-transferrable. Credit notes are provided upon provision of a medical certificate.

Accounting policies FY18: Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Company and the revenue can be reliably measured, regardless of when the payment is received.

Revenue is measured at the fair value of the consideration received or receivable, taking into account contractually defined terms of payment and excluding taxes or duty. The specific recognition criteria described below must also be met before revenue is recognised.

Box office Box office revenue is recognised on delivery of the performance.

Fundraising, Sponsorship and Government grants Non-reciprocal Fundraising, Sponsorship and Government Grant income are brought into account in the year they are received. For reciprocal Fundraising, Sponsorship and Government Grant income, the income can be deferred to a future year if there is a contract or agreement linking it to a specific future project or event.

Education revenue Education revenue is recognised as revenue in the period which the service is provided. Income received in advance is deferred and will be recognised in the following year.

Sponsorship in-kind Sponsorship in-kind is brought to account as revenue in the year to which the equal and corresponding

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SYDNEY DANCE COMPANY

expense relates. Consequently, the revenue and expenses are recognised in the same accounting year.

Commercial revenue - Dance classes Dance classes are recognised as revenue within the period in which they are provided. Dance class tickets have an expiry date of 6 months (2017: 6 months). The revenue from unused dance class tickets at year end is deferred into the following year after an adjustment is made for tickets that will remain unused at the date of expiry. Whilst 3, 5 and 10 pack dance class tickets expire after 6 months, dance class gift vouchers are subject to the new 3-year expiry legislation. The Company also sell performance vouchers which are limited to performances within a specific year.

Commercial revenue - Other Other commercial revenue includes studio hire and rental revenue from a pop-up cafe both of which are recognised when earned. School holiday workshops are also classified as other commercial revenue and revenue is also recognised when earned. (b) Government grant income included in the statement of profit or loss and other comprehensive income

Australia Council Grants MPAB core funding as per tripartite agreement Playing Australia touring fund grant Department of Foreign Affairs and Trade Grant MPA Collaborative Projects Create NSW Grants MPAB core funding as per tripartite agreement Inkind Rental Assistance* NSW Touring Grant Decant Program Support Total Government Grants

2019 $

2018 $

2,730,069 369,983 30,000

2,687,076 315,394 40,000 -

278,828 3,408,880

278,828 937,937 80,307 60,472 4,400,014

*Adoption of AASB 16 Leases in the current period has changed the way that the Company accounts for rental expenses. Whilst the leases remain unchanged, and Sydney Dance Company continues to receive in-kind rental support, no income or expense relating to in-kind rent assistance has been recognised in the current period as the Company has recognised the right of use asset and lease liabilities and has elected to recognised the asset at cost. Refer Note 18 for details of impact of adoption of AASB 16.

Revenue from government grants is recognised as each performance obligation attached to each individual grant is met. The specific performance obligations vary depending upon the terms of each grant.

When the grant is provided to meet a specific expense and the performance obligations are sufficiently specific to meet AASB 15’s requirements, revenue from the grant is recognised over the period in which the relevant cost for which it is intended to compensate, is expensed.

Where a grant is provided to meet the overarching objectives of the Company and is not tied to specific, identifiable performance obligations, it is recognised immediately as revenue.

There were no material changes to accounting treatment required as a consequence of the adoption of AASB 15 in FY19.

17

SYDNEY DANCE COMPANY

Key Judgement Government grants are recognised when there is reasonable assurance that the grant will be received, and all attaching conditions will be complied with. Judgement is involved in determining the timing of this recognition.

(c) Other income

Interest income Other income Total other income

2019 $ 32,924 698 33,622

(d) Salaries and employee benefit expenses included in the statement of profit or loss and other comprehensive income 2019 $ Wages and salaries 5,645,648 Superannuation 504,439 Workers' compensation costs 212,144 Long service leave expense 18,508 Total employee benefit expense 6,380,739

2018 $ 31,033 47,430 78,463

2018 $ 5,422,894 500,095 186,830 77,534 6,187,352

(e) Depreciation expense included in the statement of profit or loss and other comprehensive income 2019 2018 $ $ Depreciation of non-current assets 53,399 48,564 Depreciation of right-of-use assets 96,430 Total depreciation expense 149,829 48,564

4

FUNDRAISING Sydney Dance Company undertakes fundraising appeals throughout the year and holds an authority to fundraise under the Charitable Fundraising Act, 1991 (NSW). Additional information and declarations to be furnished under this Act follow: Details of aggregate gross income and total expenses of fundraising Gross proceeds from fundraising appeals Individual giving Fundraising events Less total costs of fundraising Individual giving Fundraising events

Net surplus obtained from fundraising

2019 $ 3,297,472 859,792 4,157,264

2018 $ 2,718,299 782,506 3,500,805

72,667 404,962 477,629

116,478 298,153 414,631

3,679,635

3,086,174

Application of funds Funds raised through individual giving and fundraising events support Sydney Dance Company activities.

18

SYDNEY DANCE COMPANY

Forms of fundraising* Appeals held during the year ended 31 December 2019: - General and Personal Appeals for the Commissioning Fund, Education Fund and Touring Fund and Capital Campaign, and - Fundraising events include Dance Noir, Touring Dinner and Commissioning Dinner.

Agents Sydney Dance Company employs professional staff to manage and co-ordinate its fundraising activities and does not engage commercial fundraising agents to secure donations.

Comparison of monetary figures and percentages for the year ended 31 December 2019

Total cost of fundraising/ gross income from fundraising Net surplus from fundraising/ gross income from fundraising

2019 % 477,629/ 4,157,264 3,679,635/ 4,157,264

2018 % 414,631/ 3,500,805 3,086,174/ 3,500,805

2019 %

2018 %

11%

12%

89%

88%

*No disclosure is provided as all income received and expenditure incurred is in connection with the presentation of Sydney Dance Company activities.

19

SYDNEY DANCE COMPANY

5

CASH AND SHORT-TERM DEPOSITS Cash at banks and on hand Short-term deposits

2019 $ 3,914,229 1,134,819 5,049,048

2018 $ 2,304,027 1,116,541 3,420,568

Cash and short-term deposits comprise cash at bank and on hand and short-term deposits with a maturity of three months or less. Cash at bank earns interest at floating rates based on daily bank deposit rates and short-term deposits earn interest at the respective short-term deposit rates.

Cash at banks and on hand includes an endowment amount of $230,833 (2018: $256,082) received in 2018. In accepting this endowment, the Company has agreed to utilise the proceeds of this endowment to develop and maintain the Hephzibah Tintner Artist Development Program. These funds are to be used over a 10-year period for the professional development of young artists under the program. Funds are held in a separate bank account

6

TRADE AND OTHER RECEIVABLES Trade receivables Allowance for expected credit losses

Goods and services tax receivable Other receivables Prepayments Carrying amount of trade and other receivables Movements in the provision for expected credit losses were as follows: At 1 January Utilised in the year Charge for the year At 31 December

2019 $ 43,191 (3,175) 40,016

2018 $ 56,000 56,000

31,889 111,152 162,639 345,696

61,790 95,257 161,442 374,489

3,175 3,175

165,263 (165,263) -

Trade receivables, which generally have 14-30 days terms, are recognised and carried at original invoice amount less an allowance for expected credit losses. Expected credit losses are determined by a review of the specific trade receivables outstanding at any reporting date having regard to the nature of these receivables and their expected recovery.

Revenues, expenses and assets are recognised net of the amount of GST. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the statement of financial position.

Cashflows are included in the Statement of Cashflow on a gross basis. The GST component of cashflows arising from investing and financing activities, which is recoverable from, or payable to, the ATO is classified as part of operating cashflows.

20

SYDNEY DANCE COMPANY

7

INVENTORY Inventory

2019 $ 33,685

Opening Inventory 1/1/2019 Purchases/In-kind Contributions Expense Closing Inventory 31/12/2019

2018 $ 30,955 Total 30,955 97,758 (95,028) 33,685

The Company holds merchandise which is offered for sale through the dance studios and goods which have been provided in-kind for use in promotional events and activities. Merchandise is valued at the lower of cost (after rebates and discounts) and net realisable value, being the estimated selling price in the ordinary course of business less the estimated costs necessary to make the sale. In-kind goods are valued at their replacement cost.

8

RIGHT OF USE ASSETS

Cost At 1 January 2019 Additions At 31 December 2019 Accumulated depreciation At 1 January 2019 Depreciation charge for the year At 31 December 2019 Net book value At 31 December 2019

Leased Property $ 211,128 211,128

96,430 96,430

114,698

At 31 December 2018

-

In the current period the Company adopted AASB 16 Leases for the first time. Information regarding the transition impacts of adoption can be found in Note 18 to these accounts.

At the inception of a contract, Right-of-use assets are measured at cost, comprising the following: • the amount of the initial measurement of the lease liability; • plus lease payments made at or before the commencement date, less any lease incentives received; • plus initial direct costs incurred; and • less an estimate of costs to be incurred in restoring the underlying asset to the condition required by the terms and conditions of the lease.

Subsequently, right-of-use assets are depreciated on a straight line basis over the term of the lease arrangement. They are also adjusted for any accumulated impairment losses or remeasurement of the lease liability.

21

SYDNEY DANCE COMPANY

9

PROPERTY, PLANT AND EQUIPMENT

Plant & Equipment $

Office Equipment $

Furniture & Fittings $

Computer software $

Total

Cost At 1 January 2019 Additions At 31 December 2019

166,963 9,158 176,121

104,207 17,567 121,775

48,605 48,605

24,415 4,487 28,902

344,190 31,212 375,402

Accumulated depreciation At 1 January 2019 Depreciation charge for the year At 31 December 2019

101,890 25,754 127,644

78,970 16,447 95,417

13,554 10,087 23,641

24,415 1,111 25,526

218,829 53,399 272,228

Net book value At 31 December 2019

48,477

26,358

24,964

3,376

103,174

At 31 December 2018

65,073

25,237

35,051

-

125,361

$

Plant and equipment is stated at cost, net of accumulated depreciation. All other repair and maintenance costs are recognised in profit and loss as incurred.

Depreciation is calculated on a straight-line basis over the estimated useful lives of the assets. The range of useful lives used in the current and comparative period are as follows: Plant and equipment - 2 to 5 years Office equipment - 5 years Furniture and fittings - 5 years Computer software - 3 years The useful lives of property, plant and equipment are reviewed at each financial year end and adjusted prospectively, if appropriate.

At each reporting date the Company assesses whether there is an indication that an asset may be impaired. There were no indications of impairment noted at 31 December 2019.

An item of property, plant and equipment is derecognised when it is disposed of or when no future economic benefits are expected to arise from its use or disposal. Any gain or loss arising on derecognition (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of profit or loss and other comprehensive income at the time of derecognition.

22

SYDNEY DANCE COMPANY

10

RESERVE INCENTIVE SCHEME

Reserve Incentive Scheme

2019 $ 567,456

2018 $ 558,339

The funds received under the Reserve Incentive Scheme Agreement together with the Company’s contribution are held in escrow for a period of 15 years ending on 2 April 2028 and are subject to the terms and conditions of the Reserve Incentive Scheme Agreement between the Australia Council, Arts NSW and the Company. The funds have not been used to secure any liabilities of the Company. The funds consist of short term deposits of $567,456 (2018: $558,339). No funds were required to be paid into this account by the Company in 2019 (2018: nil). The increase in the fund balance relates to interest received from shortterm deposits.

11

TRADE AND OTHER PAYABLES Current Trade Payables Other Payables

2019 $ 174,590 382,063 556,653

2018 $ 354,506 162,210 516,716

Trade and Other payables are recognised at the amount expected to be paid by the Company in settling the liability. They represent liabilities for goods and services provided to the Company prior to the end of the financial year for which the Company is obliged to make future payments. The amounts are unsecured and are usually paid within 30 days of recognition. Due to their short-term nature, they are not discounted.

Included in Other payables are liabilities for wages and salaries recognised in respect of employee's services up to the end of the reporting period which are measured at the amounts expected to be paid when the liabilities are settled.

23

SYDNEY DANCE COMPANY

12

DEFERRED REVENUE

Dance class deferred revenue Education activity deferred revenue Development activity deferred revenue Performance related deferred revenue Gift voucher deferred revenue Studio Hire Advance

2019 $ 154,395 43,685 120,000 134,546 15,963 1,980 470,569

2018 $ 151,537 47,104 120,000 150,975 13,162 482,778

Deferred revenue represents cash received prior to the end of the financial year relating to performance obligations which are yet to be satisfied. The key categories of deferred revenue relate to; • • • • •

Dance class tickets which include 3, 5 and 10 pack dance class tickets which have an expiry date of 6 months (2018: 6 months) Education activity relating to 2020 Pre Professional Year payments and school matinee bookings Development activity relating to foundation donations given for a specific contracted purpose Performance vouchers which are limited to performances within a specific year Gift vouchers for use in purchasing dance classes which have a 3-year expiry date

Key Estimate The amount which relates to unused dance class tickets outstanding at year end is recognised as a liability (deferred revenue). The liability is reduced by the value of tickets that are expected to remain unused at their expiry date. Estimates of the future use of these tickets, based on historical use of tickets, are applied in the calculation of this value.

24

SYDNEY DANCE COMPANY

13 EMPLOYEE BENEFIT LIABILITIES Current Annual leave Long service leave Non-current Long service leave

2019 $

2018 $

142,189 246,649 388,838

118,132 242,238 360,370

40,903

26,807

An annual leave liability is recognised in respect of employees’ service up to the end of the reporting period. These liabilities are measured at the amounts expected to be paid in future periods when the liabilities are settled.

The Company recognises a liability for long service leave measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date.

Expected future payments are discounted using market yields at the reporting date on high-quality corporate bonds with terms to maturity and currencies that match, as closely as possible, the estimated future cash outflows.

Where the Company has an unconditional right to defer the settlement of the long service leave for at least 12 months after the reporting date it is presented as a non-current liability.

Key Judgement and Estimates In determining the liability for long service leave consideration is given to expected future wage and salary levels, the amount of future oncosts, and anticipated periods of service.

14 GOVERNMENT GRANT ADVANCES Playing Australia touring grant amounts owing MPA Collaborative Projects Department of Foreign Affairs and Trade – Touring Create NSW touring grant advances 1 Playing Australia touring grant advances Create NSW touring grant advances 2 Total government grants deferred Movement in government grants At 1 January Received during the year* Released to the statement of profit or loss and other comprehensive income* At 31 December

2019 $ 34,798 70,000 45,000 94,902 428,883 143,919 817,502

2018 $ 36,926 94,902 131,828

131,828 4,094,554

392,320 4,139,522

(3,408,880) 817,502

(4,400,014) 131,828

*In the current period both amounts received during the year and amounts released to the statement of profit or loss exclude the value of rent assistance which is provided by the NSW Government. Whilst these arrangements have not changed, in implementing AASB 16 Leases, the Company has recognised the right of use asset and corresponding lease liability and has elected to recognize the right of use asset at cost. As the amount of the inkind rental income and expense are equal there is no net impact on the profit and loss resulting from this change in treatment. The NSW Government estimates the value of the in-kind rental support to be $865k.

25

SYDNEY DANCE COMPANY

15

LEASE LIABILITIES Current Lease Liability

2019 $

2018 $

109,380

-

Non-current Lease Liability

8,867

-

In the current period the Company adopted AASB 16 Leases for the first time. Information regarding the transition impacts of the adoption can be found in Note 18 to these accounts.

At the inception of all contractual arrangements the Company assesses whether the contract is, or contains, a lease. This determination is based on whether the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration.

The lease term is determined as being the non-cancellable period of a lease, together with periods covered by an option to extend the lease if the lessee is reasonably certain to exercise that option; and periods covered by an option to terminate the lease if the lessee is reasonably certain not to exercise that option.

Where a contract contains a lease the Company recognises a lease liability. The liability is measured at the present value of the lease payments outstanding at commencement for the non-cancellable lease period and any option periods which are reasonably expected to be exercised. Lease payments are discounted using the Company’s incremental borrowing rate which is determined having regard to the tenor of the lease and the nature of the asset.

Subsequently, the lease liability is measured by: • increasing the carrying amount to reflect interest on the lease liability; • reducing the carrying amount to reflect the lease payments made; and • remeasuring the carrying amount to reflect any reassessment or lease modifications or to reflect revised in-substance fixed lease payments.

The rent paid by Sydney Dance Company on all of its premises is subsidised by the NSW Government and, as a consequence, is lower than market. Due to the significant difficulty which would be encountered in estimating the market rental the Company has relied on the temporary relief available under AASB 2018-8 Amendments to Australian Standards – Right-of-Use Assets for Not-for-Profit Entities. This amendment allows not-for-profit entities to elect to initially measure a class or classes of asset at cost where lease terms and conditions are significant below-market principally to enable the entity to further its objectives.

In addition, the Company has applied the exemptions for short term and low value leases and not recorded these on the balance sheet. In the current period the total expenditure on these types of leases was $261,966 and $8,950 respectively.

Where the Company has the unconditional right to defer the settlement of its lease obligations for at least 12 months after the reporting date they are presented as a non-current liability.

Key Judgement In determining the amount of the lease liability, judgement has been applied in determining the option periods which are reasonably likely to be exercised and the incremental borrowing rate which would be applicable to the Company.

26

SYDNEY DANCE COMPANY

16 CONTRIBUTED EQUITY Membership fees

2019 $ 524

2018 $ 524

The membership fees were contributed by the initial members upon establishment of the Company. In accordance with the Constitution, members are not entitled to any reimbursement or return of initial membership fees upon ceasing to be a member.

17 RESERVES At 1 January Transfer from retained earnings in relation to: Capital reserve Reserve incentive scheme Hepzibah Tintner artist development program fund Reallocation from Hepzibah Tintner artist development program fund Reallocation from capital reserve At 31 December

2019 $ 2,182,031

2018 $ 1,680,573

1,558,428 9,117 -

1,036,179 7,592 256,082

(25,249) (744,139) 2,980,188

(798,395) 2,182,031

The capital reserve represents income received relating to the capital campaign fund less any specific expenses incurred in the move to Ultimo and the refurbishment of the Walsh Bay premises.

27

SYDNEY DANCE COMPANY

18 ADOPTION OF AASB 16 LEASES AASB 16 – Leases (“AASB 16”) was effective for Sydney Dance Company from 1 January 2019. It requires entities to recognise all material leases in the Statement of Financial Position with the recognition of a right of use asset and a corresponding lease liability.

The Company has property, IT and office equipment, and performance space rental arrangements. No lease agreement has been signed in relation to the Company’s return to Walsh Bay at the date of signing the financial statements.

AASB 16 Leases has been adopted using the modified retrospective approach. This means that the cumulative effect of adopting the new standard was adjusted for in opening retained earnings on 1 January 2019 and that only the current reporting period reflects the impact of the new standard. In determining the amount of the adjustment required on initial adoption the Company has taken advantage of the exemptions available for short-term and low value leases. As a consequence, leases relating to IT and office equipment and performance space have not been reflected in the Statement of Financial Position.

At the date of initial application, the Company applied the following methods in measuring the opening right of use assets and lease liabilities; • Right of Use Assets were measured on a retrospective basis as if the new rules had always applied however have been discounted using the incremental borrowing rate as at 1 January 2019 of 6.5%, and • Lease liabilities were measured as the net present value of the remaining lease payments for noncancellable lease terms and all options which are reasonably expected to be renewed. The lease payments were discounted using the Company’s incremental borrowing rate as at 1 January 2019 of 6.5%.

On transition the Company has applied the following practical expedients allowed by AASB 16; • Use of a single discount rate for leases with similar characteristics, • Exclusion of initial direct costs from the measurement of the right of use asset, and • Use of cost rather than market value in relation to the property leases Transition impact at 1 January 2019 At 1 January Right of Use Assets Lease Liabilities Retained Earnings

$ Debit/(credit) 211,128 (207,962) (3,166)

A reconciliation of the Company’s undiscounted operating lease commitments at 31 December 2018 to lease liabilities recognized on 1 January 2019 is set out below: $ Debit/(credit) Operating lease commitments disclosed 31 December 2018 Adjusted for: Discounting Extension Options Not included in commitments as at 31 December 2018 Lease Liability recognised as at 1 January 2019

88,740 (14,489) 95,351 41,526 207,962

28

SYDNEY DANCE COMPANY

Impact for 31 December 2019 As a result of applying AASB 16 the Company has recognised right of use assets of $114,698 and lease liabilities of $118,247 at 31 December 2019. In the year to 31 December 2019 the Company also recognized $96,430 of depreciation expense and $10,256 interest expense from these leases. This was instead of the rental expense which has been recognized in prior periods. These lease payments were presented as interest payments within operating activities $10,256 and principal repayments within financing activities $89,715 in the statement of cashflows.

19 COMMITMENTS AND CONTINGENCIES (a) Commitments The Company had commitments relating to the short term lease of performance space at 31 December 2019 totaling $18,392. (2018: $88,740). (b) Contingencies The directors are not aware of any contingent liabilities as at 31 December 2019 (2018: none).

20 RELATED PARTY DISCLOSURES Total donations from directors were $417,050 for 2019 (2018: $534,000). There were no other related party transactions in the period.

21 KEY MANAGEMENT PERSONNEL (a) Details of Key Management Personnel Current Directors Brett Clegg Pamela Bartlett Jillian Broadbent AC Mark Hassell Catriona Mordant AM Emma-Jane Newton Chrissy Sharp Carla Zampatti AC David Baxby Sandra McCullagh Paris Neilson David Friedlander

Chair (from 12/8/2019) Director Director Director Director Director Director Director Director Director Director Director

Executives Anne Dunn Rafael Bonachela Sean Radcliffe Lizzi Nicoll

Executive Director Artistic Director Chief Financial Officer Deputy Executive Director (from August 2019)

Non-executive Directors of Sydney Dance Company do not receive remuneration for serving on the Board of Directors. (b) Key Management Personnel

Total compensation

2019 $ 837,684

2018 $ 777,653

29

SYDNEY DANCE COMPANY

(c) Other transactions and balances with Key Management Personnel There are no other transactions or balances with key management personnel other than the Director donations disclosed in Note 20.

22 EVENTS AFTER THE REPORTING PERIOD Subsequent to 31 December 2019, the COVID-19 outbreak was declared a pandemic by the World Health Organisation in March 2020. Note 1 sets out the impact of this matter on the Company. No adjustments have been made to the financial statements as at 31 December 2019 for the impacts of COVID-19.

There have been no other significant events occurring after the reporting period which may affect either the Company’s operations or results of those operations or the Company’s state of affairs.

30

SYDNEY DANCE COMPANY

Directors' declaration In accordance with a resolution of the directors of Sydney Dance Company, I state that: In the opinion of the directors: (a) the financial statements and notes of Sydney Dance Company are in accordance with the Corporations Act 2001 and the Australian Charities and Not-for-profits Commission Act 2012, including: (i) giving a true and fair view of its financial position as at 31 December 2019 and performance; (ii) complying with Australian Accounting Standards- Reduced Disclosure Requirements (including the Australian Accounting Interpretations), the Corporations Regulations 2001 and the Australian Charities and Not-for-profits Commission Regulation 2013; and (b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable. (c) the provision of the Charitable Fundraising Act (1991) and its regulations and the conditions attached to the Authority to conduct fundraising have been complied with; and (d) the internal controls exercised by the Company are appropriate and effective in accounting for all income received and applied to its fundraising appeals. (e) the government funding received has been spent in accordance with funding agreements.

On behalf of the Board

Brett Clegg Chair Sydney, 25 May 2020

31

SYDNEY DANCE COMPANY

Declaration by Chairperson as required by the Charitable Fundraising Act 1991 (NSW) I, Brett Clegg, Chair of Sydney Dance Company, declare that in my opinion: (a) the accounts for the year ended 31 December 2019, give a true and fair view of all income and expenditure of Sydney Dance Company with respect to fundraising appeals; and (b) the statement of financial position as at 31 December 2019, give a true and fair view of the state of affairs of Sydney Dance Company with respect to fundraising appeals; and (c) the provisions of the Charitable Fundraising Act 1991 (NSW) and the regulations under the Act and the conditions attached to the authority have been complied with: and the internal controls exercised by Sydney Dance Company are appropriate and effective for all income received and applied from any fundraising appeals

Brett Clegg Chair Sydney, 25 May 2020

32

Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

Independent Auditor's Report to the Members of Sydney Dance Company Opinion We have audited the financial report of Sydney Dance Company (the Company), which comprises the statement of financial position as at 31 December 2019, the statement of profit or loss and comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration.

In our opinion, the accompanying financial report of the Company is in accordance with the Australian Charities and Not-for-Profits Commission Act 2012, including: a)

giving a true and fair view of the Company's financial position as at 31 December 2019 and of its financial performance for the year ended on that date; and

b)

complying with Australian Accounting Standards – Reduced Disclosure Requirements and the Australian Charities and Not-for-Profits Commission Regulation 2013.

Basis for Opinion We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Company in accordance with the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Material Uncertainty Related to Going Concern We draw attention to Note 1 in the financial report, which describes the impact of the Covid19 pandemic on the Company. These events or conditions indicate that a material uncertainty exists that may cast significant doubt on the Company’s ability to continue as a going concern. Our opinion is not modified in respect of this matter.

33 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

Information Other than the Financial Report and Auditor’s Report Thereon The directors are responsible for the other information. The other information obtained at the date of this auditor’s report is the directors’ report accompanying the financial report but does not include the financial report and our auditor’s report thereon.

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Report The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards – Reduced Disclosure Requirements and the Australian Charities and Not-for-Profits Commission Act 2012 and for such internal control as the directors determine is necessary to enable the preparation of the financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.

Auditor's Responsibilities for the Audit of the Financial Report Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report.

As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgment and maintain professional scepticism throughout the audit. We also:

34 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

•

Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

•

Obtain an understanding of internal control relevant to the audit 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 Company’s internal control.

•

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the directors.

•

Conclude on the appropriateness of the directors’ use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Company to cease to continue as a going concern.

•

Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.

We communicate with the directors regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Report on the requirements of the NSW Charitable Fundraising Act 1991 and the NSW Charitable Fundraising Regulations 2015 We have audited the financial report as required by Section 24(2) of the NSW Charitable Fundraising Act 1991. Our procedures included obtaining an understanding of the internal control structure for fundraising appeal activities and examination, on a test basis, of evidence supporting compliance with the accounting and associated record keeping requirements for fundraising appeal activities pursuant to the NSW Charitable Fundraising Act 1991 and the NSW Charitable Fundraising Regulations 2015.

Because of the inherent limitations of any assurance engagement, it is possible that fraud, error or non-compliance may occur and not be detected. An audit is not designed to detect all instances of non-compliance with the requirements described in the above-mentioned Act and Regulations as an audit is not performed continuously throughout the period and the audit procedures performed in respect of compliance with these requirements are undertaken on a test basis. The audit opinion expressed in this report has been formed on the above basis.

35 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

Opinion In our opinion: a)

b)

the financial report of the Company has been properly drawn up and associated records have been properly kept during the financial year ended 31 December 2019, in all material respects, in accordance with: i.

sections 20(1), 22(1-2), 24(1-3) of the NSW Charitable Fundraising Act 1991;

ii.

sections 10(6) and 11 of the NSW Charitable Fundraising Regulations 2015;

the money received as a result of fundraising appeals conducted by the Company during the financial year ended 31 December 2019 has been properly accounted for and applied, in all material respects, in accordance with the above mentioned Act and Regulations.

Ernst & Young

Lisa Nijssen-Smith Partner Sydney 25 May 2020

36 A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation