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WORKING WITH THE COMMUNITY 2009 ANNUAL REPORT


ATP VISION To become a highly recognised community at a local, national and global level for the provision of facilities which promote and showcase Australian technology, innovation and research.


CONTENTS :

02 04 05 06 08 10

Charter Minister’s Letter From the Chairman & Managing Director Board Members Corporate Governance Operational Structure & Performance

11 18 22 24 28 29

Management & Achievements Conference & Exhibition Centre Beyond ATP Directors’ Report Directors’ Declaration Auditors’ Independence Declaration

30 32 36 62 64 65

Independent Auditor’s Report Financial Statements Notes to Financial Statements Appendices Index Credit

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT 01


CHARTER:

ATP has now become one of Australia’s most dynamic multi-purpose precincts and includes unique world class conferencing and exhibition facilities with a national reputation for excellence.

The Australian Technology Park (ATP) was owned and managed by the Sydney Harbour Foreshore Authority and then became a wholly owned subsidiary of the RedfernWaterloo Authority (RWA) in April 2005. It is one of eight locally significant strategic sites under the jurisdiction of the RWA.

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Plaza

National al In Innovation Centre

Locomotive Workshop. Conference Exhibition Centre. Tenant Area.

Large Erecting Shed

Platform 10 MAR IAN ST

International Business Centrre

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Pacific Publications NICTA

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Tennis and Basketball Courts

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Biomedical HBuilding

Childcare Centre

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ALEXAN DER ST

The purpose of the ATP was to provide an environment for collaborative research and development where companies could forge exciting new alliances and access support for commercialisation. It has now become one of Australia’s most dynamic multi-purpose precincts and includes unique world class conferencing and exhibition facilities.

To Parramatta & Blue Mountaiins

Main Entrance Ma

TRAFFIC LIGHTS

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

The ATP has inherited an environment with a considerable history of industrialisation and technology. The majority of the 13.8 hectare site was previously owned by the State Rail Authority and used for almost a century as the Eveleigh rail yards.

02

The ATP’s first decade was one of significant technological and scientific innovation. Since 2005, an investment of more than $54m has resulted in new roads and infrastructure along with the completion in 2008 of the 11,000sqm research facility for National Information and Communications Technology Australia (NICTA) and the Defence, Science & Technology Organisation (DSTO).

Also in 2008, construction began on the $123m television studio and media complex to house Channel 7, its publishing group, Pacific Magazines, and the headquarters of Global Television.

These developments will stimulate commercial interest and encourage associated industries wanting to seek synergies with such a large and dynamic industry presence to locate within the ATP.

Australian Technology Park’s accessibility, infrastructure and central location – combined with the new media centre and North Eveleigh’s redevelopment will further contribute to the status of ATP as a world class technology and business centre.

While the Park prepares to meet the needs of high profile future tenants, many resident companies have contributed individually and collaboratively to its success over the long-term. The aim is for the Park to be fully developed over the next 5 – 10 years, with an ultimate workforce of more than 9000 permanent employees, making ATP the main driver in Redfern-Waterloo’s economic growth over the next decade.


AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

CeBit’09

03


MINISTER’S LETTER:

The Hon. Kristina Keneally MP Minister for Redfern-Waterloo Parliament House Macquarie Street Sydney

Dear Ms Keneally, I have pleasure in submitting the ninth Annual Report of the Australian Technology Park Precinct Management Limited for the year ended 30 June 2009. The report has been prepared in accordance with the provisions of the Annual Reports (Statutory Bodies) Act 1984, the Public Finance Audit Act 1983, and the Regulations under those Acts.

Yours Sincerely

Roy Wakelin-King

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Managing Director Australian Technology Park Prencinct Management Limited

04

This report complies with NSW Annual Report legislation. Statuary account and financial information have been verified by the NSW Auditor General.


FROM THE CHAIRMAN & MANAGING DIRECTOR: This is the ninth Annual Report for Australian Technology Park Precinct Management Limited (ATPPML). In the November 2008 Mini Budget, the NSW Government elected to sell the Australian Technology Park site on a 99-year lease basis as part of the State’s asset sale program. ATPPML is currently assisting with preparation for the sale process by gathering information about the site and its buildings, and confirming details regarding licences, leases, heritage and future development. Progress is being communicated to tenants and other key stakeholders as the sale process develops. ATPPML has taken a business-as-usual approach during the sale process, and its focus remains on business outcomes, quality customer service and improving the Park’s amenity for tenants, visitors and the public. ATPPML remains financially strong with a resilient business model built on a valued technology brand; a competitive asset management and tenancy platform; a broadly based conference and events business; and cost and capital efficiency. Over the years ATPPML has built a strong foundation on this business model and this continues to form the basis of our future priorities. Despite the uncertain economic times, ATPPML continues to grow and has improved its underlying profitability (profit before non operating costs) under the ownership of the Redfern-Waterloo Authority. It is clear the contribution of our staff has been a key factor in delivering this result and that our employees remain the competitive edge of ATPPML.

In achieving this result, Precinct Management revenue increased 28% to $16.2m as a result of maintaining a low vacancy factor of 2.5%, low tenant turnover,

ATPPML was also very pleased to successfully secure the University of Sydney as a major new tenant to the ATP. The University has leased the laboratory space in the Biomedical Building made vacant by Johnson & Johnson earlier in the year. Other new and expanding tenancies during the last 12 months included Post Op Group, the Cancer Council of NSW, Top Education and the Roads & Traffic Authority. ATPPML has been steadily improving its cost efficiency with a focus on ensuring value for money services for the Park. This has resulted in significant savings and improved service delivery for ATP site security, and arrangements are underway to realise further service improvements and savings in the delivery of mechanical services to the ATP. ATPPML has worked hard to improve communication with tenants, customers and the community. To this end we launched a new interactive website, implemented an electronic newsletter and sponsored the Up Close and Digital series designed by AIMIA NSW and the Australian Directors Guild to encourage collaboration between Australia’s best directing and producing talent working in film, television and new digital media. A quarterly ATP CEO’s Forum was also established during the year to recognise the active contribution of ATP business leaders. ATPPML re-established links to the local business community through a close association with the Redfern Chamber of Commerce and ATP hosted a networking function attended by people from local businesses and ATP enterprises.

decreased only 12.5% to $4.11m for the 2008-2009 Financial Year. In a deteriorating market damaged by the financial crisis, maintaining our business activity levels in this highly competitive market is further evidence of the sound business model, quality of the venue and the hard work of the staff. Among the highlights for the year were the filming of MasterChef Top 50 and Top Gear Australia at ATP, The Young Cure Cancer Carnival Ball, the YWCA Mother of all Balls, the Eco Forum and the InStyle Women InStyle Awards. The development of the ATP site also continued during the year with the first private sector investment for a major new media hub within the Park nearing completion. The site, known as 8 Central Avenue, is scheduled for completion in early 2010. The site will include offices and production studios for the Seven Network, Pacific Magazines and Global Television. This state-of-the art media facility will occupy 41,800sqm, is expected to employ up to 1200 permanent new staff and 500 freelancers, and will include a new plaza and an extension of Locomotive Street. In these challenging times, the ATPPML continues to perform strongly and build a reputation as a world class facility. ATPPML is playing a leading role in the urban renewal of the Redfern-Waterloo area through its ongoing investment in the Park, while the transformation of the ATP site is continuing to stimulate the economic and social outcomes for the local community. The growth and development of the site as the major technology, information, media and entertainment centre in NSW will continue providing outstanding opportunities and benefits to the Redfern-Waterloo area. Finally, we would like to extend our appreciation to the tenants and our conference centre customers for their commitment and ongoing support of the ATP.

ATPPML also worked closely with the Redfern-Waterloo Authority and developed our engagement with the local community through managing and operating the Eveleigh Markets. Following on from its exceptional performance during the 2007-2008 Financial Year, the ATP Conference Centre revenue

Dr Col Gellatly AO Roy Wakelin-King Chairman

Managing Director

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

While ATPPML reported a net loss of $10.3m resulting from non-operating and one off costs associated with land remediation and fair value loss adjustments to property values, it remains cash flow positive, maintains a strong cash at bank position with a net increase of $4.2m and an underlying profit of $9.3m – a 19% increase on the previous year’s result of $7.8m.

and revenue from the first full year tenancy of the NICTA Building. The low vacancy factor compared very favourably to the City fringe catchment area, which continues to experience vacancy rates in excess of 9%.

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BOARD MEMBERS:

INDEPENDENT BOARD MEMBERS

Dr Col Gellatly AO

Mike Collins

Richard Johnson

Lucy Hughes Turnbull

B Ag Ec 9 (Hons) UNE, M Comm (Hons) UNSW, Ph D NC State, FIPAA

FRICS

MBE M Phil (UCL) B.Arch Hons 1 (UNSW) FRAIA

LLB (Sydney), MBA (UNSW)

Mike Collins is a Sydney property practitioner. He has been involved in property economics, real estate valuation, property consultancy and asset management for over 35 years, and is professionally qualified in property economics and valuation. He runs his own property advisory company based in the Sydney CBD. Mike is the Chairman of the Sydney Harbour Foreshore Authority and the Barangaroo Delivery Authority. He is a board member of the Redfern Waterloo Authority, a former Chairman of the Heritage Council of NSW and a former National and NSW President of the Australian Property Institute.

Richard Johnson is an award winning architect, a Visiting Professor of Architecture at the UNSW and a Director of Johnson Pilton Walker Architects. He is also a Fellow of the Australian Institute of Architects, an Associate of the Japan Institute of Architects, and a Member of the Design Institute of Australia. He also serves on the Board of the Redfern-Waterloo Authority and the Australian Architects Association. Mr Johnson has a Bachelor of Architecture from the UNSW and a Master of Philosophy (Town Planning) from University College, London. In 1976 he was made a Member of the Order of the British Empire for services to architecture.

Lucy Hughes Turnbull is a Director of the Board of Melbourne IT, an Australian publicly-listed internet services company with operations in North America, Europe and Asia. She is also a Board Member of the RedfernWaterloo Authority, the Centre for Independent Studies, the Redfern Foundation Limited, the Turnbull Foundation and the NSW Cancer Institute. Lucy was Sydney’s first female Lord Mayor (2003-4) and Deputy Lord Mayor (1999-2003). She served as a Councillor on the City of Sydney from 19992004 and chaired many council committees. Lucy has also been active in the not for profit sector and is currently Chair of the Salvation Army’s City of Sydney Red Shield Appeal and Deputy Chair of the Committee for Sydney.

Chairman

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Dr. Col Gellatly AO was Chairperson of the RedfernWaterloo Authority, as of 1 July 2007 and a former DirectorGeneral of the Premier’s Department. He has held a number of senior management positions within the NSW public service and is also Chair of Pillar Corporation, a member of the Board of State Water Corporation, a member of the UNE Council, member of Board of the NSW Rugby League and an Administrator, Wollongong City Council. Dr. Gellatly has a degree in Agricultural Economics from the University of New England, a Master of Commerce from UNSW and a PhD from North Carolina State University.

06

NOTE:

Ms Mohini Nair, Acting MD

Disclosures

Ms Mohini Nair was the Acting Managing Director of ATP from 29 November 2008 to 13 February 2009.

The ATPPML has no related party disclosures to declare.


INDEPENDENT BOARD MEMBERS

Ann Weldon

RESERVED BOARD MEMBERS

John Mulally

Roy Wakelin-King

Robert Domm

BA LLB (Hons) (Appointed 23 January 2008)

BPS (UNE) GDP Bus (UTS) (Appointed 16 February 2009)

BA LLB (Mon) MLLR(Syd) Grad.Dip.Legal Prac. (ANU) (Resigned 28 November 2008)

Current Managing Director John is a lawyer specialising in major property and infrastructure projects. He has acted for major Australian and off-shore developers and investors, Australian and State Government instrumentalities and off-shore Governments. This has included the acquisition, development and sale of major projects in all capital cities of Australia as well as in Vanuatu, Jakarta, Bangkok, Singapore, Tokyo, London, Paris, St Petersburg, Kiev, Moscow and New York. He has also advised on major energy projects in Australia and offshore including infrastructure and renewable energy projects in China and Africa. John is also a Board Member of the RedfernWaterloo Authority.

Roy Wakelin-King was appointed the Chief Executive Officer on 16th February 2009. Prior to this, Roy was the Deputy Director General of the Office of Public Works & Services with the NSW Department of Commerce. Roy was also CEO of the World Youth Day Coordination Authority which coordinated the delivery of Government services for the highly successful World Youth Day 2008. Roy has been an Executive Director within the NSW Ministry of Transport in the position of Director-Transport Operations Division. This role involved the leadership and management of a multi-discipline division that coordinates the delivery of essential public transport services to the public of NSW. Roy has extensive experience in both operations and project leadership, particularly in the fields of transport and logistics. His experience includes a short Army career as a commissioned officer followed by a series of senior project and operational appointments within the NSW Government. Roy is also a Board Member of the RedfernWaterloo Authority.

Robert Domm was CEO of the Redfern-Waterloo Authority and Managing Director of Australian Technology Park until November 2008. Mr Domm spent four years at the City of Sydney, including three as General Manager. He served as a Director of the Sydney Festival Ltd and is also a Director of the South Sydney Leagues Club. Mr Domm was appointed CEO of the Sydney Harbour Foreshore Authority by the NSW Government in July 2008 and holds degrees in Arts and Law, a Masters in Labour Law & Relations and a graduate diploma in Legal Practice.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Ann Weldon is a proud member of the Wiradjuri Nation and was one of the founding members of the NSW Aboriginal Children’s Service and Inner West Aboriginal Community Company to name a few. For the past 35 years, Ms Weldon has held executive positions and was a member of a number of Committees including the Metropolitan Local Aboriginal Land Council, Marrickville Aboriginal Consultative Committee and Aboriginal Legal Service. Ms Weldon was elected to the Sydney ATSIC Regional Council for three consecutive terms as a Councillor and as the Chairperson and Deputy Chairperson. Ann was appointed to the inaugural NSW Aboriginal Housing Board in 1998 as an ATSIC nominee and was then appointed the first female Chairperson of the NSW Housing Board from 2000 until 2007. Ann is also a Board Member of the RedfernWaterloo Authority.

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CORPORATE GOVERNANCE:

The ATP Board of Directors is responsible for the corporate governance of ATP including setting the strategic direction, establishing goals for management and monitoring the achievement of these goals.

Australian Technology Park is a whollyowned subsidiary of the Redfern-Waterloo Authority (RWA). The RWA was created by the NSW Government in January 2005 to manage public infrastructure, land and properties in the Redfern-Waterloo area and to foster commercial opportunities for local business. As a State-significant site, ATP is part of the overall RWA urban renewal strategy for the Redfern-Waterloo area. The ATP Board of Directors is responsible for the corporate governance of ATP including setting the strategic direction, establishing goals for management and monitoring the achievement of these goals. The Board meets monthly to consider the progress of ATP with input from senior management relating to strategic direction and performance, while major reviews are held periodically throughout the year.

Financial Reporting & Internal Controls

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

ATP’s auditing activities are overseen by an Audit & Risk Management Committee. This Committee assesses the integrity of ATP management and the adequacy and appropriateness of internal controls and systems.

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Attending ATP Audit & Risk Management Committee meetings are independent members and representatives from ATP’s Executive Management, the NSW Audit Office and Deloitte Touche Tohmatsu’s internal audit unit. The Audit and Risk Management Committee acts independently and is responsible for:

• External Audit – Reviewing the annual Engagement Letter / Client Service Plan / annual service fee presented by the Audit Office. Assessing the effectiveness and value of work performed under the Client Service Plan and overseeing the implementation of audit recommendations. • Financial Reporting – Assessing the ATP’s compliance. Monitoring the compliance of the ATP’s annual financial statements with statutory responsibilities relating to financial disclosure. Reviewing the ATP’s annual financial reports and recommending them for the Managing Director’s approval. Assessing the performance of the ATP’s financial management in terms of, internal controls, policies and procedures; adherence to Accounting Standards, Treasury Directions and so on; and monitoring and reporting of revenue and expenditure relative to approved budgets. • Internal Audit – Review and approval of the internal audit charter. Engaging the services of an accredited auditor. Reviewing the appropriateness of the Internal Audit Plan / annual service fee presented by the Internal Auditor. Assessing the value and effectiveness of work performed. Monitoring the timely implementation of audit recommendations. • Risk Management – Monitoring the effectiveness of risk management control systems and procedures and reviewing the risk planning framework of the ATP to ensure its effectiveness and alignment with Australian Standard AS 4360, and providing input into the risk planning process as appropriate.

• Internal Controls – Review and assessment of the effectiveness of, or weakness in, the ATP’s internal control structure through communication with management and the internal and external auditors in respect of the accounting, internal auditing, reporting and other financial management systems and practices of the ATP. Reviewing the appropriateness of procedures for ensuring that new systems are developed with adequate controls, and to assess the effectiveness of controls over the new systems which are developed. Reviewing the appropriateness of delegations of authority and guidelines for general operations. Reviewing the appropriateness of the ATP’s risk management policies and procedures. Reviewing the extent to which internal and external auditors’ work can be relied upon to detect control weaknesses or fraud. Reviewing significant control deficiencies reported by the internal and external auditors and to ensure that management’s response and actions to correct any noted deficiencies, are appropriate and adequately implemented on a timely basis. Reviewing the effectiveness of controls in relation to unusual transactions or potential transactions that may carry more than a normal degree of risk. • Legal Compliance – Reviewing all significant transactions that do not form part of ATP’s formal business. Considering compliance with any regulatory authority’s statutory requirements. Reviewing any current and pending litigation or regulatory proceedings to which ATP is a party.


• Compliance with ATP’s Code of Conduct – reviewing with management, its philosophy with respect to business ethics and corporate conduct, its written code of conduct and program and monitoring compliance with that code. Reviewing significant cases of employee conflict of interest, misconduct or fraud. • Other Matters – Instigate special audits, investigations and operational reviews as deemed necessary. Understand key issues arising from such investigations and be satisfied that matters are properly addressed and reported. Monitoring the implementation of procedures related to the ATP’s Fraud Control Plan and Code of Conduct, and recommending or commenting on any required amendments in policies and procedures. Monitoring the ATP’s policy on sensitive issues or practices, including reporting of alleged corrupt conduct.

respect for the law, system of Government and the community and its people; along with integrity, diligence, economy and efficiency, and accountability. These values and principles are expected from all ATP employees – including its Executive Managers, permanent and temporary staff, consultants and contractors. A copy of the Staff Code of Conduct is also provided to new employees. Through its own work, Australian Technology Park is committed to managing the environment by balancing the demands of heritage conservation, commercial activation, community expectation and cultural diversity.

ATP’s actual results for 2008-09 is a loss of $10.3m against a budgeted profit of $2.9m. ATP’s land and building were re-valued on 31 May 2009 and delivered a revaluation loss of $10.4m. Also included in the loss is $5.5m paid for the site remediation costs of the Channel 7 development.

ATP aims to achieve Place Management Leadership in the management of its environment, and its support of ecologically sustainable development (ESD). This reflects the vision of creating a safe and dynamic place to work by providing living precincts and rewarding partnerships.

Ignoring interest, one-off expenditure and income, the normalised operating results represent a surplus profit of $1.9m over the budget. ATP has continued to grow under the ownership of the RedfernWaterloo Authority, while consolidation and restructuring over the last three years within the organisation has continued to deliver significant profits and positive cash flows.

Occupational Health & Safety

Statement of Business Intent

Standards of Behaviour and Environmental Management Policy

Over the past year ATP has undertaken a complete review of its occupational health and safety management system to improve organisational performance. This has resulted in increased safety awareness amongst staff, a systematic approach to identifying and controlling risks, more efficient project performance, improved staff participation, targeted training and improved relationships between clients, contractors, suppliers, consultants and staff.

Australian Technology Park has its own Staff Code of Conduct and Environmental Management Policies, both of which were developed in accordance with the principles of ethical decision-making and the values of

Central to these outcomes has been the development of work-specific risk management systems, revised emergency procedures, a dedicated first aid room with trained first aid officers throughout

Procurement Systems and Efficiencies The Australian Technology Park Procurement Policy was developed to ensure all work is allocated equitably and in respect of the principles and guidelines as required by Government policy. ATP has a standard method of procuring goods, services and work which is consistent across the organisation, with risks adequately assessed and managed, and duplication of effort and research avoided. Our suppliers understand what is expected of them and are required to deliver in accordance with those expectations. All procurement is performed in accordance with probity policies. Key principles underpinning the Policy are: • Value for money – as in benefits achieved compared to whole-of-life costs • Efficiency and effectiveness • Probity and equity; and • Effective competition

Privacy Management Policy Australian Technology Park applies a Privacy Management Plan to its operations to meet the requirements of the Privacy and Personal Information Protection Act 1998. ATP collects and maintains a limited amount of personal information relating to its tenants and, to a lesser extent, its service providers, while all staff are required to familiarise themselves with the Policy and integrate it into the management of their own work practices. The Executive Manager Business and Finance is the company’s Privacy Officer and the person to be contacted on all privacy matters. The complete Privacy Management Policy is also available to key stakeholders and the public.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

The Statement of Business Intent establishes financial performance targets for the organisation based on forecast financial returns.

The focus of the Environmental Management Policy is on a ‘beyond compliance’ culture which embraces a performance-driven objective management program delivering increased stakeholder value. Success will be demonstrated by cultural acceptance of implementing environmental management as a specific consideration that is acknowledged within all business processes and fully understood by all staff as part of their responsibilities.

the site, shared access improvements to ATP roads, completion of the OHS Training Plan and the implementation of a comprehensive permit system for high risk works associated with electrical isolation, working at heights, confined spaces, ground excavations, hot works and heavy vehicle access to the ATP site.

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OPERATIONAL STRUCTURE & PERFORMANCE:

Consistent consolidation and restructuring within the organisation continues to deliver significant profits and positive cash flows.

ATP Operational Structure

Executive Management

Property and Asset Management

25,000

Business and Financial Management

Conference and Exhibition Centre

ATP Year to Year Comparison

Eveleigh Markets

Key Business Objectives Financial • Consolidate financial profitability

20,000

• Increase revenue returns • Implement savings initiatives 15,000

• Examine capital investment options • Improve asset utilisation Customers & Stakeholders

10,000

• Provide high quality service • Effectively communicate with stakeholders

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

5,000

10

• Create new development opportunities • Liaise with the community 0

2004-05

2005-06

2006-07

2007-08

2008-09

People & Business • Communicate effectively and consistently

Total Revenue Precinct Management Revenue Conference Centre Revenue

• Maintain strong leadership, recruitment and retention

Cost of Sales

• Support a safe and healthy workplace

Operating Costs

• Ensure a strong corporate governance

Employee Related Expenses

• Promote and facilitate environmental awareness

Profit before Non Operating Costs

• Encourage business growth and improvement


MANAGEMENT & ACHIEVEMENTS:

ATP Executive Management Team

Roy Wakelin-King Managing Director

Chris Saunders General Manager

The Executives are responsible for: • The day to day management of Australian Technology Park;

Sanjeev Goyal Executive Manager Business & Finance

Ruby Chronis Director Sales & Marketing

• Preserving and enhancing the Park’s heritage status. The responsibilities of the Executives are carried out in respect of and in accordance with the following objectives:

Ariana Aljinovic Eveleigh Markets Manager

• As custodians, promote a sense of community ownership through preservation and interpretation of the natural, built and heritage significance of the site.

• Major employment and financial investment in the Park’s future prosperity with the NICTA Building and commencement of construction of the Channel 7 Media Centre

ATP has continued to grow under the ownership of the Redfern-Waterloo Authority, while consistent consolidation and restructuring within the organisation continues to deliver significant profits and positive cash flows. This was further achieved by the enforcement of strict financial disciplines and implementation of a number of key management initiatives:

• Strategic marketing of the Conference & Exhibition facilities to major event producers and suppliers

• Encouraging innovative technology; • Ensuring continued development of the built environment; and

Graham Stevens Asset Management

• A continual focus on skills alignment throughout core operations

• Capitalise on the economic and cultural potential of the Park as a place for the growing population of Sydney to visit and work;

• Adherence to strict financial disciplines and the streamlining of financial and property management systems to meet increasing business demands

• Balance the economic return, vibrancy and diversity of the Redfern and Waterloo communities; and

• A sustained occupancy rate averaging 97 percent • Further renewed interest in the availability of space generated by current and proposed on-site development

• Ensuring adherence by all staff and tenants to management policies and procedures • A continued focus on security and associated security infrastructure to further enhance perception of overall safety throughout the Park for staff, tenants and visitors

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

• To revitalise surplus government land through the creation of a dynamic commercialisation precinct;

• Strengthening of local and international industry and government alliances through visiting delegations and networking ventures

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MANAGEMENT & ACHIEVEMENTS:

Despite the effects of the global financial crisis, occupancy rates still remained at an average 97 percent, while current and future development will create additional space for lease.

Precinct Management

Asset Management

ATP Precinct Management is responsible for the day-to-day management of Australian Technology Park for the benefit of its stakeholders, customers, tenants, industry partners and the general community.

The Asset Management team is a small group of property specialists responsible for the management of the Park’s property assets. Their responsibilities include:

Around 100 organisations employing up to 1,800 people currently occupy leased space in the Locomotive Workshops, the Biomedical Building, the National Innovation Centre (NIC), the International Business Centre (IBC), and the NICTA, RTA & Ambulance buildings. Despite the effects of the global financial crisis, occupancy rates still remained at an average 97 percent, while current and future development will create additional space for lease. Australian Technology Park also has a number of high-profile partners in the wider business community, industry associations and the media, while support networks are available to facilitate knowledge-sharing and information exchange on a global scale.

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Customers include businesses residing at the Park, contractors and suppliers, Conference & Exhibition Centre clients, national and international delegations, study tours and prospective future tenants.

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As one of the Redfern-Waterloo Authority’s strategic sites, the ATP has a Development Office within Precinct Management which continues to monitor, oversee and coordinate the expansion and enhancement of the ATP site.

• Achieving commercial rentals on all tenancies

The University of Sydney has also leased in excess of 3,000m2 of space in the Biomedical Building for lecture and research facilities and their operations will commence in the 2009-2010 Financial Year. Tenants who expanded operations and leased additional space on site included:

• Minimising vacancies • Maximising net income • Ensuring compliance with all relevant legislation

• Fuji Xerox • AC3 • Cancer Institute of NSW

• Ensuring all physical assets are properly maintained

• Smart Services CRC

• Arranging necessary upgrades and refurbishments • Ensuring maximum capital value of the property assets

Further space in the NICTA Building and the Locomotive Workshops is also expected to be occupied by the RTA during the 2009-2010 Financial Year.

New Tenants

Other matters of note:

The Post Op Group commenced its lease of an 1800sqm facility in Bay 15 in January 2009. The group specialises in sound and vision post production for standard and high definition television, cross-media platforms and feature film. The group’s offering at the ATP is a series of production units: private offices clients can use while carrying their projects through to the finished product. The company’s latest work can be seen on Top Gear, Missing Persons Unit, Home Made, The Zoo, Border Security, The Force and Better Homes and Gardens.

• The Security & Mechanical Services contracts were re-tendered

• Top Education Group

• OH&S documentation was upgraded as part of an ongoing review • A number of long-term leases were negotiated with new and existing tenants • Mail deliveries were taken over by Australia Post


Post Op Group Post Op took possession of their expansive 1,800-square-metre facility in Bay 15 at ATP in January 2009. “Everyone loves the building,” reports Managing Director, Serge Lacroix who says the spacious new location has boosted productivity. “I’ve got a great team who make everything nice and easy.”

Post Op Group engineer

Post Op Group engineer

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Serge Lacroix, MD of Post Op Group

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MANAGEMENT & ACHIEVEMENTS:

ATP is one of eight State-significant heritage sites under the jurisdiction of the Redfern-Waterloo Authority (RWA).

Heritage The ATP has inherited an environment with a considerable history of industrialisation and technology. The majority of the 13.8 hectare site was previously owned by the State Rail Authority and used for almost a century as the Eveleigh rail yards. It is now one of eight State-significant heritage sites

under the jurisdiction of the RedfernWaterloo Authority (RWA).

• The heritage water tower and boilers were refurbished

A number of heritage matters were completed during the 2008-2009 Financial Year. These included:

• The majority of the heritage fascias of the Locomotive Workshops were painted as part of an ongoing program

• The Heritage Asset Management Strategy and accompanying Section 170 register were completed and endorsed by the Heritage Council

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Locomotive Workshop

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Refurbished Water Tower

Refurbished Water Boiler


AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Locomotive Workshop

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ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

In February 2009, ATP took on the role as managers of the Farmers’ & Artisans’ Markets which are housed within the former Blacksmiths’ Workshop at the historic Eveleigh Railyards in Wilson Street.

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Eveleigh Markets


MANAGEMENT & ACHIEVEMENTS:

Finance Management Finance Management worked closely with the RWA to maintain the efficiency of financial operations and sustain profitability including: • Streamlining financial and property management systems at ATP and RWA to meet increasing business demands • Aligned business systems, analysis and reporting, and continued consolidation of financial and payroll services across the two organisations • Enforced strict financial disciplines • Ensured adherence by all staff to policies and procedures

IT Management

Conferencing & Event Management • Market and communicate the availability of the conference and exhibition facilities at the Park • Secure new high yield business from the public and private sectors

Corporate Services • Provides budgeting, financial management, information technology and e-services, general administration and payroll services. • Provides support for the company and the Board and liaises with other companies and government agencies • Handles Freedom of Information requests, ensures correct corporate governance and satisfies government agency reporting requirements

Networking & Community Relations In the reporting year, ATP’s networking, knowledge-sharing and information exchange platform included: • Several CEO and Tenant Forums • Launch of the new ATP website and e-newsletter • Sponsorship, contribution and assistance to tenants with representation at CeBIT Australia • The availability of informal meeting zones, cafes and outdoor recreational/ relaxation areas • Encouraging the ATP community to participate in on site events for major charities via fundraising initiatives such as Australia’s Biggest Morning Tea for the Cancer Council and Jeans for Genes Day for the Children’s’ Medical Research Institute

Combining technology and sustainability is a key feature of the ATP. Early in 2009, the Park successfully launched its e-newsletter via the ATP website to provide invaluable information and a means of communicating with tenants in a more environmentally conscious manner. ATP has also been fostering dialogue with the wider community, including as hosts of a Redfern-Waterloo Chamber of Commerce networking function in June 2009 attended by local businesses and ATP enterprises. In February 2009, ATP took on the role as managers of the Farmers’ & Artisan’s Markets which are housed within the former Blacksmiths’ Workshop at the historic Eveleigh Railyards in Wilson Street. This area also encompasses the CarriageWorks arts and cultural precinct and the Yaama Dhiyaan Indigenous cafe and hospitality training centre. The Farmers’ Market plays host to Sydney’s only undercover produce market each Saturday, while the Artisans’ Market is held on the first Sunday of every month and offers a truly inspirational venue in which to browse and purchase affordable, original and highly creative work directly from the hands of emerging and established talent. These events continue to provide a great community facility and attract more than 3000 visitors every week.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

IT Management continues to be a major focus of activity for ATP. A strong commitment to supply state-of-theart services to its tenant-partners and customers is complemented by a continuous supply philosophy. The Company reviewed its Disaster Recovery Policy and documentation during the year, with Stage 2 involving the replacement of all servers and desktops currently underway. This will be followed by the implementation of Stage 3 with scheduled replacement of the CISCO switches.

• Oversee meetings and events for clients in the various meeting rooms and Exhibition Hall

17


CONFERENCE & EXHIBITION CENTRE:

ATP’s Conference & Exhibition Centre has a reputation for excellence, creativity and flexibility. It is regarded by many to be the most unique and versatile conference and exhibition venue in Sydney.

The ATP Conference & Exhibition Centre is one of Australia’s most prestigious event destinations, offering the best of old and new with unique industrial-style halls and purpose-built conference facilities in the historic Locomotive Workshops; ideal for showcasing new technologies and hosting corporate and association-based conferences, special events and exhibitions. The Centre has a reputation for excellence, creativity and flexibility and is regarded by many to be the most unique and versatile conference and exhibition venue in Sydney. It offers a wealth of facilities for managing & staging events and conferences, and can accommodate a wide range of event requirements. Venues include an

auditorium theatre, grand dining room with adjoining atrium, multiple breakout areas and exhibition spaces, a variety of conference rooms and the 6850sqm Exhibition Hall. In 2008 – 2009, the Conference & Exhibition Centre hosted a variety of events – from small meetings to large scale exhibitions and corporate functions – including high repeat business. The Centre once again targeted major local and national events including trade shows, multi-day high yield conferences with an exhibition element, and special events including dinners, launches and entertainment. Sales blitzes to new and existing clients were held twice in the year

THE PLACE TO BE FOR AUSTRALIAN TV The Exhibition Hall is the centrepiece of ATP’s venues and has featured in several prominent shows on a number of television networks. With its dramatic open space highlighted by towering cast-iron columns, arched windows and rustic brickwork, the venue makes an impressive impact. ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

MasterChef Auditions

18

Australian Idol Auditions

The national profile of the venue was significantly enhanced in the first six months of 2009 when the Top 50 trials of MasterChef Australia were filmed at Australian Technology Park. The competitive cooking game show produced by Fremantle Media Australia screened on Network Ten was an enormous ratings success exposing the Park to around 1.4 million television viewers each week for the first few months of the series.

and the Conference Centre also continued to build and strengthen its working relationships with event producers and suppliers. Representatives from the Conference & Exhibition Centre attended several industry trade shows and exhibited at AIME (Asia Pacific Incentives & Meetings Expo) in February 2009. This event attracts more than 850 exhibitors from 50 countries and over 3000 trade visitors.

ATP also hosted the Sydney auditions in May for the next series of Australian Idol. Around 1,800 budding singers and musicians supported by family and friends started to queue the day before for an opportunity to dazzle the judges. This is the fourth year ‘Idol’ has held its Sydney auditions at ATP. Top Gear Australia screened on SBS also used the venue for publicity photos and filming of a car trial, while the Nine Networks ‘Random Acts of Kindness’ premiered in June 2009 with host Karl Stefanovic dwarfed by giant screens and the Hall’s familiar towering columns. In terms of national exposure, ATP’s unique event facilities continue to further boost the area’s reputation as a dynamic destination for event organisers and this will no doubt be further bolstered by the Channel 7/ Global Television networks which will both be based in the Park from 2010.


AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Cure Cancer Carnivale Ball

19


CONFERENCE & EXHIBITION CENTRE:

The Centre targets major local and national events including trade shows, multi-day high yield conferences with an exhibition element, and special events including dinners, launches and entertainment.

Other significant events during the Financial Year included: Cure Cancer Carnivalé Ball (September 2008) The Exhibition Hall was brilliantly transformed into a casino for the Cure Cancer Carnivalé Ball organised by the Young Cure Cancer Committee. Around 700 guests enjoyed entertainment from Rachel St James, David Campbell and Erica Heynatz, with the prestigious event raising almost a quarter of a million dollars for cancer research.

YWCA Mother of All Balls (October 2008)

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

The Mother of All Balls was themed ‘A Night in Royal Rajasthan’, featured entertainment by Jade McRae, and raised funds for the Big Brothers, Aunties & Uncles mentoring program which helps vulnerable children in the community.

20

AIMIA Awards

ECO Forum Conference & Exhibition (April 2009)

InStyle and Audi Women of Style Awards (May 2009)

The EcoForum Conference & Exhibition is Australia’s leading Ecoforum. It was a threeday industry event comprising 12 conference streams with around 500 delegates, 600 visitors and up to 40 exhibitors and their staff from across Australia in attendance and included an Ecoforum gala dinner for delegates, exhibitors and guests.

AIMIA Awards (March 2009)

The inaugural InStyle and Audi Women of Style Awards was a star studded event celebrating Australia’s most inspirational and innovative women. There were 27 nominees, with 10 women receiving major honours, including former model Sarah Murdoch and champion surfer Layne Beachley who tied in the community and charity category. Actress Cate Blanchett also scored the Readers’ Choice and Arts & Culture awards.

The Australian Interactive Media Industry Association (AIMIA), Australia’s peak industry body for digital and interactive content, honoured 24 winners of its 15th annual AIMIA Awards at a glitzy ceremony bringing together over 700 industry leaders at ATP.

The Uniform Distribution & Accreditation Centre (UDAC) for the Sydney 2000 Olympic Games holds the record for the longest running event at the ATP Conference Centre. It ran continuously for 275 days from February to November in 2000.

Hosts Adam Spencer and Airlie Walsh kept the crowd entertained and the evening did not disappoint, with a capacity crowd of members and guests.


InStyle Women of Style Awards

YMCA Mother of Balls

Volkswagen

Masterchef ECO Forum Auditions

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

CeBit’09 CeBit 2009

21


BEYOND ATP:

ATP’s near-complete $123m state-of-the-art television facility will create a leading hub for Australian media with international impact.

While recent televised events from Australian Technology Park, including the MTV Australia Awards in 2008 and Masterchef Australia in 2009, have raised the profile of the site to an unprecedented level, ATP’s near-complete $123m state-of-the-art television facility will create a leading hub for Australian media with international impact. Construction of the media complex has progressed at a remarkable rate, with the Seven Network, Global Television and Pacific Magazines expected to be fully relocated into the new 43,500sqm facility by early 2010.

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

The building is Australia’s first specially designed digital production and broadcast centre, comprising production studios, studio facilities, warehousing, 11 office storeys and parking for 700 vehicles. It will also include a new public plaza with café.

22

Seven is recognised as one of Australia’s leading media companies. It is in fact the largest commercial television network and one of the two largest magazine publishers in the country. Meanwhile, Global Television, Australia’s largest independent facilitator of broadcast television, is also establishing a major new production facility in the Channel 7 building, making it the largest dedicated television production facility in the country.

The complex will ultimately provide up to 2000 additional jobs on the ATP site. Following intense archaeological investigation and consultations with the Heritage Council of NSW, the first phase of construction commenced in December 2007. Work has since generated up to 600 construction jobs including a number of positions for local Indigenous workers. As at August 2009, the last pieces of the glazed outer walls had been installed, with the focus moving to internal finishes, and acoustic testing of the television studios begun to ensure the elimination of external noise. The design of the new building achieves a minimum 4.5 Star Australian Green Building Rating (AGBR) for the office component and also responds to the unique attributes of the ATP site, with the studios sharing an industrial interpretation of the architecture and location facing the railway workshops along Locomotive Street. The identification of the media complex will be celebrated by integrated roof signage. It is anticipated that the move to ATP by Channel 7, Pacific Magazines and Global Television will stimulate interest from other major media and technology companies over the next few years and further consolidate ATP’s position as a major hub for creative enterprise.

Even with more than $200 million of capital investment already in train, the ATP site has more development potential under its planning controls. Accordingly, staged marketing of its three remaining development lots will allow for the construction of an additional 110,000sqm of commercial floor space. It is the Park’s strong belief that tenants and those that elect to become part of the Australian Technology Park community during this accelerated growth period will benefit from the tremendous opportunities the next decade of development is destined to deliver.


AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Channel 7 Development

23


DIRECTORS’ REPORT:

ATP is set to become one of Australia’s most dynamic media hubs and during the course of the next year will commence the staged marketing of its four remaining development lots.

The Directors of the Australian Technology Park Precinct Management Limited (“the Company”) present their report together with the financial report of the Company for the year ended 30 June 2009 and the auditor’s report thereon.

Directors The Directors of the Company at any time during or since the end of the financial year are: Dr Colin Gellatly AO – Chairman

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

B Ag Ec 9 (Hons) UNE, M Comm (Hons) UNSW, Ph D NC State, FIPAA

24

Dr Col Gellatly AO was Chairperson of the Redfern-Waterloo Authority, as of 1 July 2007. Dr Gellatly AO is the former DirectorGeneral of the Premier’s Department, a role which he held since being appointed in 1994. He has held a number of senior management positions within the NSW public service, including as Director General of the Department of Land and Water Conservation. He is also Chair of Pillar Corporation, a member of the Board of State Water Corporation, a member of the UNE Council, member of Board of the NSW Rugby League and an Administrator, Wollongong City Council. Dr Gellatly AO has a degree in Agricultural Economics from the University of New England, a Master of Commerce from the University of NSW and a PhD from North Carolina State University. Robert Domm – Former MD (Resigned 28 Nov 2008) BA LLB (Mon), MLLR (Syd), GDLP (ANU)

Robert Domm was Chief Executive Officer of the Redfern-Waterloo Authority and Managing Director of Australian Technology Park since the inception of the RWA in 2005 and remained in the role until his

appointment by the NSW Government as Chief Executive Officer of the Sydney Harbour Foreshore Authority in July 2008. Mr Domm brought broad experience and a strong commitment to social justice during his tenure as Chief Executive Officer with the RWA. Roy Wakelin-King – Current MD BPS (UNE) GDP Bus (UTS)

Roy Wakelin-King was appointed the Managing Director on 16th February 2009. Prior to this, Roy was the Deputy Director General of the Office of Public Works & Services with the NSW Department of Commerce. Roy was also CEO of the World Youth Day Coordination Authority which coordinated the delivery of Government services for the highly successful World Youth Day 2008. Roy has been an Executive Director within the NSW Ministry of Transport in the position of Director-Transport Operations Division. This role involved the leadership and management of a multi-discipline division that coordinated the delivery of essential public transport services to the public of NSW. Roy has extensive experience in both operations and project leadership, particularly in the fields of transport and logistics. His experience includes a short Army career as a commissioned officer followed by a series of senior project and operational appointments within the NSW Government.

economics and valuation. He runs his own property advisory company based in the Sydney CBD. Mike is the Chairman of the Sydney Harbour Foreshore Authority and the Barangaroo Delivery Authority. He is a board member of the Redfern Waterloo Authority and Australian Technology Park Precinct Management Ltd, a former Chairman of the Heritage Council of NSW and a former National and NSW President of the Australian Property Institute. Mr John Mulally BA LLB (Hons)

John has almost 40 years experience as a lawyer specialising in major property and infrastructure projects. He has acted for major Australian and off-shore developers and investors, Australian and State Government instrumentalities and off-shore Governments. This has included the acquisition, development and sale of major projects in all capital cities of Australia as well as in Vanuatu, Jakarta, Bangkok, Singapore, Tokyo, London, Paris, St Petersburg, Kiev, Moscow and New York. He has also advised on major energy projects in Australia and off-shore. He is currently advising on major infrastructure and renewable energy projects in China and Africa. His role in these projects deals with the funding structure, legal requirements and the integration of the commercial with the legal outcomes required to achieve project development.

Mr Michael Collins

Mr Richard Johnson

FRICS

MBE M Phil (UCL) B.Arch Hons 1 (UNSW) FRAIA

Mike Collins is a Sydney property practitioner. He has been involved in property economics, real estate valuation, property consultancy and asset management for over 35 years, and is professionally qualified in property

Richard Johnson is an award winning architect and a director of Johnson Pilton Walker Architects. He was awarded the 2008 RAIA Gold Medal for his exceptional body of work and his contribution to the


profession. He is a Professor in the Faculty of the Built Environment at UNSW, A Fellow of the Australian Institute of Architects and a member of the Design Institute of Australia. He advises the Sydney Opera House Trust on the future of the building and is a member of the City of Sydney Design Advisory Panel. He serves on the Boards of the RWA, the ATP and the Australian Architects Association. Mr Johnson holds a Bachelor of Architecture from UNSW and a Masters of Philosophy (Town Planning) from University College London. In 1976 he was made a member of the Order of the British Empire for services to Architecture. Ms Lucy Hughes Turnbull LLB (Sydney), MBA (UNSW)

Ms Ann Weldon Ann Weldon is a proud member of the Wiradjuri Nation and was one of the

Company Secretary The Company secretary is Sanjeev Goyal. He has during the financial year attended all Board Meetings and Risk & Audit Committee Meetings.

Meeting of Directors The number of meetings of the Company’s Board of Directors during the year ended 30 June 2009 and the number of meetings attended by each Director is: Director

Board Meetings

Dr Colin Gellatly AO Ms Lucy Hughes Turnbull Mr Mike Collins Mr John Mulally Ms Ann Weldon Mr Richard Johnson Mr Roy Wakelin-King

A 9 9 9 9 3 8 5

B 10 10 10 10 10 10 5

Mr Robert Domm

4

5

The Company’s Audit & Compliance Committee Meetings Director

Number of Meetings Attended

Mr Roy Wakelin-King Ms Sam Mostyn Mr John Mulally Mr Jim Mitchell Mr Petar Vladeta

A 1 2 3 3 2

B 1 3 3 3 2

A: Number of meetings attended B: Number of meetings held during the time the Director held office durinng the period.

Company Particulars Australian Technology Park Precinct Management Limited is incorporated in Australia. The address of the registered office is: Redfern-Waterloo Authority Level 11, Tower2, 1 Lawson Square Redfern NSW 2016

Principal Activity The Company operates a scientific and technological research and development park. Spread over 13.8 hectares, the park occupies the site of the heritage listed Eveleigh Railway workshops. The principal activity of the Company during the financial year was to manage the commercial operations of Australian Technology Park, which include property management and development, the provision of convention and exhibition facilities and the running and management of the Eveleigh Markets. Other than the commencement in managing the operations of the Eveleigh Markets, there were no significant changes in the nature of the activities of the Company during the financial year.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Lucy Hughes Turnbull is a Director of the Board of Melbourne IT, an Australian publicly-listed internet services company with operations in North America, Europe and Asia. She is also a Board Member of Australian Technology Park in Redfern, the Centre for Independent Studies, the Redfern Foundation Limited, the Turnbull Foundation and the NSW Cancer Institute. Lucy was Sydney’s first female Lord Mayor (2003-4) and Deputy Lord Mayor (1999-2003). She served as a Councillor on the City of Sydney from 1999-2004 and chaired many council committees, including the Central Sydney Planning Committee, the Planning, Transport and Development Committee and the Finance and Audit Committees. Lucy has also been active in the not for profit sector and is currently Chair of the Salvation Army’s City of Sydney Red Shield Appeal and Deputy Chair of the Committee for Sydney.

founding members of the NSW Aboriginal Children’s Service. Ms Weldon has held executive positions and was a member of the Murawina Aboriginal Preschool, Aboriginal Housing Company, Metropolitan Local Aboriginal Land Council, Marrickville Aboriginal Consultative Committee, Aboriginal Housing Development Committee and ATSIC’s National Women’s Advisory and National Sport and Recreation Committees. Ms Weldon was a member of the Sydney ATSIC Regional Council for over 10 years, including a term as Chairperson. Ann was appointed to the inaugural Aboriginal Housing Board in 1998 as an ATSIC nominee and has remained Chairperson of the NSW Aboriginal Housing Board since her appointment in 2000.

25


DIRECTOR’S REPORT:

The Company continues to focus on stringent financial and cost control measures, improved productivity and realignment of skills initiatives.

Review and result of operations The loss from ordinary activities for the year amounted to $10.3m (2008: profit of $8.6m). During the financial year ended 30 June 2009, the Company’s investment property was re-valued and this resulted in a fair value loss adjustment of $10.4m. The company also incurred land remediation costs of $5.5m on the Channel 7 site development and also repaid the grant of $2.5m to the Redfern-Waterloo Authority which was received in the prior year. ATP has been cash positive with a net cash increase of $4.2m. Borrowings from the parent amounted to $4.0m, taking the total loan amount to $44.5m. Excluding the non-operating and one-off items, the Company’s operating profit (before interest) of $8.4m compares with the prior year profit of $6.7m.

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

ATP has continued to grow under the ownership of RWA. The consolidation and organisational restructuring efforts in the last three years have continued to deliver significant profits and positive cash flows. The Company continues to focus on stringent financial and cost control measures, improved productivity and realignment of skills initiatives.

26

These results have been achieved in a difficult operating market given the advent of the Global Financial Crisis (GFC) and the resultant global economic downturn.

increase the rentals as the licences came up for renewals. Today the tenancy mix at the park is a good balance between large and small tenants as well as blue chip and start up companies. The leasing market for the ATP has remained relatively stable and experienced overall vacancy fluctuations between 2-4%. These vacancy figures compare favourably to the City Fringe catchment vacancy rate of about 9%. The low vacancies enjoyed by the ATP are likely to continue. However there is an inherent risk that ATP may not be able to adequately accommodate the expansion needs of existing anchor tenants. With NICTA moving into the new building, ATP had for the first time in years some 3,000sqm of further available floor space which was very quickly taken up by tenants like Post Op Group who work very closely with Channel 7. Some of the other tenants who have expanded their tenancies include Cancer Council, Top Education and the NSW Roads and Traffic Authority. Johnson & Johnson, who have been at the park for about 10 years decided to relocate their operations elsewhere. Whilst it was disappointing to see them go after such a long time at the Park, ATP has been successful in leasing the custom built laboratory space to the University of Sydney effective from July 2009. The property valuation in 2009 declined as a result of the GFC. However as a result of

Property Management and Development

securing good market rentals for over 8,000m2

Over the last two years, the ATP Asset management team has made significant efforts in a number of areas to enhance the property, reduce the outgoings and

of new and renewed space on mostly long term commitments, the ATP property valuation declined by 17% as compared to the industry standard of approximately 30%.

Conference and Exhibition Centre Conference Centre revenue reduced by $0.6m during the current year as compared to the prior year. This was a direct result of a deteriorating market during the GFC. This decline appears not to have been as dramatic as some of the other venues in Sydney, as well as interstate who have experienced declines in excess of 20%. This is reflective of ATPPM Ltd’s proactive marketing and sales operations and our commitment to service given to Conference Centre events by the events team. The Company continued targeting major local and national events including trade shows, multi-day high yield conferences with an exhibition element and special events including dinners, launches and entertainment. Sales blitzes to new and existing clients were held twice in the year and the Conference Centre continued to build and strengthen its working relationships with event producers and suppliers. Major events hosted during the year included the filming of the Australian MasterChef Top 50, Australian Idol, Top Gear, the Young Cure Cancer Carnival Ball, YWCA Mother of all Balls, Eco Forum and the InStyle Women InStyle awards.

Eveleigh Market Since the first markets in December 2008, the Eveleigh Farmers Market has grown in popularity and is now a favourite place for many weekly shoppers. The protection of an undercover market place and areas dedicated to seating provides a relaxing environment for market attendees. Over the 4 months to June 2009, the average stallholder numbers have been 66 per week and the number of people who attended the markets averaged 3,000.


ATPPM Ltd exercises considerable care to ensure the principles required for the establishment and management of a farmers market are respected and upheld to ensure that consumers are provided with authentic farm produce sold directly by food producers. Collaborative ‘farm-share’ participation is also permitted whereby a group of neighbouring or district farmers choose to operate a joint stall. The Eveleigh Farmers’ Market is held on every Saturday and is complemented by an Artisans’ Market which is held on the first Sunday of each month. The Eveleigh Markets are currently in their start up phase. ATPPM Ltd Is making every effort to ensure that the Markets become sustainable in the longer term as a stand alone business as soon as is possible.

Capital Expenditure ATP spent $208k on capital works projects in 2008-09. This expenditure mainly related to the construction of the First Aid room, Furniture for the Eveleigh Markets, Software and other Miscellaneous Plant and Equipment.

Debt Position There is a loan agreement between ATP and Redfern-Waterloo Authority (parent) under which ATP borrowed $44.5m for the construction of the NICTA Building.

Dividends The Company is limited by guarantee, and dividends are not payable in respect of 2008-09.

State of affairs

Environmental regulation The Company’s operations are subject to various environmental regulations under both Commonwealth and State legislation, which set the minimum requirements that the Company must meet.

member, or any entity in which the Director has a substantial financial interest has made (during the year ended 30 June 2009 or at any other time) with:

Events subsequent to balance date

a) the Company;

No item, transaction or event of a material and unusual nature has arisen between 30 June 2009 and the date of this report that has significantly affected the operations of the Company or is likely to affect the state of affairs of the Company in subsequent years.

b) an entity that the contact was made or when the Director received, or became entitled to receive, any benefit (if any).

Likely developments In the November 2008 Mini Budget, the NSW Government announced Its Intention to sell the Australian Technology Park site on a leasehold basis as a part of the State’s asset divestment program. The sale process is currently being managed by the NSW State Property Authority (SPA). The Company is currently assisting the SPA with preparation for the sale, including the conduct of the Due Diligence process for the sale. The exact timing for the sale of the ATP will be determined by the NSW Government. The first private sector investment within the Park which began in 2007 is scheduled for completion in early 2010. This site will include offices and production studios for the Seven Network, Pacific Magazines and Global Television. This state-of-the art media facility will occupy 41,800 m2, is envisaged to employ up to 1,200 permanent staff and 500 freelancers, and will also include a new plaza.

Auditor’s Independence Declaration under section 307C of the Corporations Act 2001

Indemnification and insurance of officers and auditors During or since the financial year, the Company has not indemnified, or made a relevant agreement for indemnifying, against liability of any present or former officer or auditor of the Company as contemplated by subsections 309A(1) and (2) of the Corporations Act 2001. During the financial year, the Company paid a premium under a contract of Directors and Officers Insurance. Disclosure of the nature of the liability and the amount of the premium is prohibited by the confidentiality clause of the contract of insurance.

Rounding off The Company is of a kind referred to in ASIC Class Order 98/100 dated 10 July 1998 and in accordance with that Class Order, amounts in the Financial Report and Directors’ Report have been rounded to the nearest thousand dollars, unless otherwise stated. This report is made in accordance with a resolution of the Directors made pursuant to S298(2) of the Corporations Act 2001. On behalf of the Directors,

The auditor’s independence declaration is set out on page 29 and forms part of the Directors’ Report for the year ended 30 June 2009.

Directors Benefits Since 30 June 2008, no Director has received, or has become entitled to receive a benefit because of a contract that the Director, a firm of which the Director is a

Roy Wakelin-King Managing Director Australian Technology Park Sydney 21 October 2009

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

In the opinion of the Directors, there were no other significant changes in the state of affairs of the Company that occurred during the financial year under review.

The Company monitors compliance with environmental regulations, and the Directors are not aware of any significant breaches during the period covered by this report.

27


DIRECTORS’ DECLARATION:

Director’s Declaration for the Year Ended 30 June 2009

Pursuant to Section 41C (1B) of the Public Finance and Audit Act 1983 and the Corporations Act 2001 and in accordance with a resolution of the Directors of Australian Technology Park Precinct Management Limited, we, the Directors declare that: 1. The accompanying financial statements exhibit a true and fair view of the financial position and financial performance of the Company at 30 June 2009 and the results of its operations and transactions of the Company for the year then ended; 2. The financial statements have been prepared in accordance with the Australian Accounting Standards and Interpretations and the provisions of the Public Finance and Audit Act 1983, the Corporations Regulations 2001, the Public Finance and Audit Regulation 2005 and the Treasurer’s Directions; 3. We are not aware of any circumstances that would render any particulars included in the financial statements to be misleading or inaccurate; and 4. There are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable. This declaration is made in accordance with a resolution of the Board of Directors.

Dr Col Gellatly Chairman

Roy Wakelin-King Managing Director

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Australian Technology Park Precinct Management Limited Sydney, dated 21 October 2009

28


AUDITOR’S INDEPENDENCE DECLARATION:

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

29


ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

INDEPENDENT AUDITOR’S REPORT:

30


AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

31


FINANCIAL STATEMENT :

Income Statement For The Financial Year Ended 30 June 2009

NOTES

$’000

$’000

2(a)

18,690

16,861

Other income

2(b)

4,340

465

Contributions

2(c)

-

2,500

23,030

19,826

( 1,719)

( 1,297)

( 651)

( 544)

Depreciation and amortisation expenses Other expenses

2(d)

( 9,494)

( 8,560)

Finance costs

2(e)

( 3,027)

( 3,279)

Changes in fair value of Investment property

2(f)

( 10,460)

2,505

Land Remediation costs

2(g)

( 5,500)

-

Grants given to Parent

2(h)

( 2,500)

-

( 33,351)

11,175

( 10,321)

8,651

-

-

(Loss)/Profit after tax from continuing operations

( 10,321)

8,651

Net (loss)/profit for the year

( 10,321)

8,651

Net (loss)/profit attributable to the parent entity

( 10,321)

8,651

(Loss)/Profit before income tax equivalent Income tax equivalent

The accompanying notes form part of these statements ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

2008

Revenue from continuing operations

Employee benefits expenses

32

2009

1(i)


FINANCIAL STATEMENT :

Balance Sheet As of 30 June 2009

NOTES

2009

2008

$’000

$’000

Current Assets Cash and cash equivalents

3

31,065

26,827

Trade and other receivables

4

861

3,011

Lease incentive asset

8

470

369

32,396

30,207

Total Current Assets Non-Current Assets Investment Property

5

64,640

75,100

Property, plant and equipment

6

20,138

16,444

Intangible asset

7

125

137

Trade and other receivables

4

4,186

4,564

Lease incentive asset

8

2,095

1,910

91,184

98,155

123,580

128,362

9

3,317

12,156

Borrowings

12

378

352

Provisions

10

1,334

1,748

5,029

14,256

Total Non Current Assets Total Assets Current Liabilities Trade and other payables

Total Current Liabilities Non Current LIabilities 11

32

28

12

49,250

44,975

9

9,625

-

16B

11,931

11,069

Total Non Current Liabilities

70,838

56,072

Total Liabilities

75,867

70,328

Net Assets

47,713

58,034

47,713

58,034

47,713

58,034

Deferred lease revenue Other liability

Equity Retained profits Total Equity The accompanying notes form part of these statements

13

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Provisions Borrowings

33


FINANCIAL STATEMENT :

Statement of Recognised Income and Expense For The Financial Year Ended 30 June 2009

NOTES

(Loss)/Profit for the year Total recognised income and expense for the year

13

2009

2008

$’000

$’000

( 10,321)

8,651

( 10,321)

8,651

( 10,321)

8,651

Attributable to: Equity holders of the parent entity

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

The accompanying notes form part of these statements

34


FINANCIAL STATEMENT :

Cash Flow Statement For The Financial Year Ended 30 June 2009

NOTES

2009

2008

$’000

$’000

Inflow/ (Outflow)

Inflow/ (Outflow)

22,573

13,773

( 2,500)

2,500

( 18,708)

( 3,213)

1,807

1,875

( 2,760)

( 3,025)

412

11,910

Payments for property, plant and equipment

( 208)

( 21,756)

Net cash used in investing activities

( 208)

( 21,756)

Proceeds from parent entity

4,034

12,221

Net cash flows from financing activities

4,034

12,221

Net increase in cash and cash equivalents

4,238

2,375

26,827

24,452

31,065

26,827

Cash flows from operating activities Receipts from customers Contributions received/(Paid) Payments to suppliers and employees Interest received Interest paid Net cash flows from operating activities

14 (b)

Cash flows from investing activities

Cash flows from financing activities

Cash and Cash equivalents at the start of the financial year Cash and Cash equivalents at the end of the financial year

14 (a)

The accompanying notes form part of these statements

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT 35


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

1. Summary of Accounting Policies CORPORATE INFORMATION The Australian Technology Park Precinct Management Limited (the Company) is a wholly owned subsidiary of the Redfern-Waterloo Authority (the Authority). It is a Company limited by guarantee. The Company is responsible for the day-to-day management of the Australian Technology Park (ATP) located at Eveleigh in Sydney, NSW. The Company assessed its status and determined that it is a ‘for profit’ public sector entity from 1 July 2005 for financial reporting purposes. The financial report for the year ended 30 June 2009 has been authorised for issue by the Board on 21 October 2009. a) Basis of Preparation The financial report is a general purpose financial report which has been prepared in accordance with : • Australian Accounting Standards and Australian Accounting Interpretations • Public Finance and Audit Act 1983 • Public Finance and Audit Regulation 2005 and • The Corporations Act 2001 The financial report has been prepared on the basis of full accrual accounting using historical cost accounting conventions except for noncurrent physical assets and investment properties which are measured at fair value. Except when an Australian Accounting Standard permits or requires otherwise, comparative information is disclosed in respect of the previous period for all amounts reported in the financial report. The financial report is presented in Australian dollars and all values are rounded to the nearest thousand dollars ($000) unless otherwise stated. The New South Wales Government’s Mini-Budget 2008-2009 included a proposal to divest the Company’s assets to the private sector by way of a 99 year lease. The exact timing for the sale of the Australian Technology Park will be determined by the NSW Government. The members of the Board of Directors believe that the proposed divestment has not impacted the Company’s financial position. b) Basis of Measurement The financial report has been prepared on the basis on accrual accounting using historical cost accounting conventions except for: (i) non-current physical assets measured at fair value ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

(ii) investment properties are measured at fair value

36

c) Use of Estimates and Judgements In the application of the Company’s accounting policies, management is required to make judgements, estimates and assumptions about carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are recognised, or in the period in which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both current and future periods. d) Statement of Compliance The financial report complies with International Financial Reporting Standards (IFRS).


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

e) Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the income statement over the period of the borrowings using the effective interest method. Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in other income or finance cost. f) Borrowing Cost Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed. g) Investment Property Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in production or supply of goods or services or for administrative purposes. Investment property is measured initially at cost including transaction cost and subsequently at fair value. Changes in fair values are recorded in the income statement in the period in which they arise. When investment property changes such that it is reclassified as property, plant and equipment, its fair value at the date of reclassification becomes its cost for subsequent accounting. h) Provision Provision is recognised when the Company has a present legal or constructive obligation as result of past event. The obligation can be measured reliably and it is probable that an outflow of economic benefits will be required to settle the obligation. i) Taxes (i) Good and Service Tax Revenues, expenses and assets are recognised net of the amount of GST except when the GST incurred on a purchase of goods and services is not recoverable from the taxation authority, in which case the GST is recognised as part of the cost of acquisition of the asset or as part of the expense item as applicable

Cash flows are included in the Cash Flow Statement on a gross basis and the GST component of cash flows arising from investing and financing activities, which is recoverable from, or payable to, the taxation authority, are classified as operating cash flows.

(ii) National Income Tax Equivalent On 16 February 2005, a private ruling was made in favour of the Company, where it was deemed that Section 24AM of Income Tax Assessment Act 1936 will apply to exempt the Company’s income from the imposition of income tax. The private rule was in effect to the year ended 30 June 2007. On 8 January 2007, another private ruling was made in favour of the Company extending the date of exemption to 30 June 2010.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Receivables and payables, which are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables in the balance sheet.

37


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

1. Summary of Accounting Policies (continued) j) Intangible Asset Intangible asset is recognised if it is probable that the future economic benefits associated with the item will flow to the Company, and it can be measured reliably. Intangible asset is measured at cost less accumulated amortisation and accumulated impairment loss. The Company’s intangible asset is amortised using the straight line method over period of three years. k) Cash and Cash Equivalent Cash and cash equivalent includes cash on hand, short term deposit with original maturities of three months or less and investment in NSW Treasury Corporation’s (TCorp) Hourglass Facility Trust. For cash flow statement presentation, cash and cash equivalents consist of cash and cash equivalents as defined above, net of outstanding bank overdrafts. l) Property Plant and Equipment i)

Recognition and Measurement

Property, Plant and Equipment is initially recognised at acquisition cost, including any costs directly attributable to the asset and any restoration costs associated with the asset. Cost is the amount of cash and cash equivalents paid or the fair value of the other consideration given to acquire the asset at the time of its acquisition or construction. Assets acquired at no cost or for nominal consideration are initially recognised at their fair value at the date of acquisition. Gain and Loss on disposal of property, plant and equipment are determined by comparing proceeds from disposal with the carrying amount of property, plant and equipment and are recognised in income statement. When revalued assets are sold, the amounts included in the revaluation reserve are transferred to retained earnings. ii)

Valuation of Plant and Equipment

Plant and Equipment is valued at fair value in accordance with Australian Accounting Standard and NSW Treasury Paper on Valuation of Physical Non Current Assets. Specialised plant and infrastructure is measured at estimated write down replacement cost.

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

iii) Valuation of Land and Building

38

Land and buildings are shown at fair value, based on annual valuation by general valuers. iv) Capitalisation of Asset Capital Expenditure in excess of $5,000 is capitalised where it is expected to provide future economic benefits for more than one reporting period. Only Asset completed and ready for service is taken to Property Plant and Equipment account. The remaining capital expenditure is carried forward as construction in progress and included in Property, Plant and Equipment in the Balance Sheet. v)

Reclassification to Investment Property

Property that is being constructed for future use as investment property is accounted for as property, plant and equipment


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

until construction or development is complete. At completion, Property, Plant and Equipment is re-measured to fair value and reclassified as investment property. Gain or loss from re-measurement is recognised in income statement. When the use of property changes from owner occupied to investment property, the property is re-measured to fair value and reclassified as investment property. Any gain arising on re-measurement is recognised in income statement to the extent the gain reverses a previous impairment loss on the specific property, with any remaining gain recognised in the revaluation reserve directly in equity. Any loss is recognised in the revaluation reserve directly in equity to the extent that an amount is included in equity relating to the specific property, with any remaining loss recognised immediately in income statement. vi) Subsequent Cost Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Company and the cost of the item can be measured reliably. The carrying amount of any component accounted for as a separate asset is derecognised when replaced. All other repairs and maintenance are charged to the income statement during the reporting period in which they are incurred. vii) Depreciation Depreciation is recognised in profit or loss on a straight line basis over the estimated useful lives of each part of an item of property, plant and equipment. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Company will obtain ownership by the end of the lease term. Land is not depreciated. The estimated useful lives for the current and comparative periods are as follows: •

Furniture and fittings

4-5 years

Plant and equipment

3-4 years

Leasehold improvements

**

** Shorter of the period of the lease or useful life. m) Impairment The carrying amount of assets, other than investment property, are reviewed at each reporting date to determine whether there is any indication of impairment. If such indication exists then the asset’s recoverable amount is estimated.

Impairment loss is recognised if the carrying amount of an asset or its cash generating unit exceeds its recoverable amount. Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of cash generating units are allocated first to reduce the carrying amount of the other assets in the unit on a pro rata basis. Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. Impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

The recoverable amount of an asset or cash-generating unit is the greater of its value in use and its fair value less costs to sell. In assessing the value in use, the estimated future cash flows are discounted to their present value of money and the risks specific to the asset. For the purpose of impairment testing, assets are grouped together into the smallest group of assets that generates cash inflows from continuing use that are largely independent of the cash inflows of other assets or group of assets.

39


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

1. Summary of Accounting Policies (continued) n) Trade and Other Payables These amounts represent liabilities for goods and services provided to the Company prior to the end of financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition. o) Trade and Other Receivables Trade receivables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, less provision for impairment. Trade receivables are generally due for settlement within 7 days. Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off by reducing the carrying amount directly. An allowance account (provision for impairment of trade receivables) is used when there is objective evidence that the Company will not be able to collect all amounts due according to the original terms of the receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 90 days overdue) are considered indicators that the trade receivable is impaired. The amount of the impairment allowance is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the original effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. The amount of the impairment loss is recognised in the income statement within other expenses. When a trade receivable for which an impairment allowance had been recognised becomes uncollectible in a subsequent period, it is written off against the allowance account. Subsequent recoveries of amounts previously written off are credited against other expenses in the income statement. p) Employee Benefits (i) Wages and salaries, annual leave and sick leave Liabilities for wages and salaries, including non-monetary benefits, annual leave and accumulating sick leave expected to be settled within 12 months of the reporting date are recognised in other payables in respect of employees’ services up to the reporting date and are measured at the amounts expected to be paid when the liabilities are settled.

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

(ii) Long Service Leave

40

The liability for long service leave is recognised in the provision for employee benefits and measured as the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimated future cash outflows. (iii) Defined Contribution Plans Defined contribution plans is a post employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as a personnel expense in profit or loss when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in future payments is available. (iv) Termination Benefits Termination Benefits are recognised as an expense when the Company is demonstrably committed, without realistic possibility of


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognised as an expense if the Company has made an offer encouraging voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptance can be estimated reliably. q) Revenue Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third parties. The Company recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Company’s activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Company bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Revenue is recognised for the major business activities as follows: i)

Rental Revenue

Rental revenue is accounted for in accordance to rental agreement. Majority of rental revenue is accounted for on straight line basis over the lease of the term. ii)

Rendering of services

Revenue from a contract to provide services is recognised by reference to the stage of the completion of the contract. iii) Interest Revenue Interest revenue is recognised on an accrual basis using the effective interest method. iv) Contributions Contributions are recognised as revenue when the Company obtains control over the asset comprising the contributions. Control over contributions are normally obtained upon the receipt of cash or other assets. r) Dividends The Company is a Company limited by guarantee and does not pay any dividends.

i)

Operating Lease

Where the Company is the lessee, operating lease payments are recognised as an expense in the income statement on a straightline basis over the lease term. Where the Company is the lessor, leases in which the Company retains substantially all the risks and benefits of ownership of the leased asset are classified as operating leases. Operating lease rental receipts are recognised as revenue in the income statement on a straight-line basis over the lease term. In the event that lease incentives are offered to enter into operating leases, such incentives are recognised as a liability. The aggregate benefits of incentives are recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

s) Leases

41


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

1. Summary of Accounting Policies (continued) ii)

Finance Lease

Leases of property, plant and equipment where the Company, as lessee, has substantially all the risks at inception at the fair value of the leased property or, if lower, the present value of the minimum lease payments. The corresponding rental obligations, net of finance charges, are included in other short-term and long-term payables. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The property, plant and equipment acquired under a finance lease is depreciated over the shorter of the asset’s useful life and the lease term. t) Accounting Standards and Interpretations issued but not yet effectives

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Certain new accounting standards and interpretations have been published that are not mandatory for 30 June 2009 reporting periods. The following new Accounting Standards and Interpretations have not yet been adopted and are not yet effective:

42

AASB 8 Operating Segments and AASB 2007-3 Amendments to Australian Accounting Standards arising from AASB8 (For reporting periods commencing on or after 1 January 2009)

Revised AASB 123 Borrowing Costs and AASB 2007-6 Amendments to Australian Accounting Standards arising from AASB 123 (For reporting periods commencing on or after 1 January 2009)

Revised AASB 101 Presentation of Financial Statements and AASB 2007-8 Amendments to Australian Accounting Standards arising from AASB 101 (For reporting periods commencing on or after 1 January 2009)

AASB 2008-1 Amendments to Australian Accounting Standard – Share-based Payments: Vesting Conditions and Cancellations (For reporting periods commencing on or after 1 January 2009)

Revised AASB 3 Business Combinations, AASB 127 Consolidated and Separate Financial Statements and AASB 2008-3 Amendments to Australian Accounting Standards arising from AASB 3 and AASB 127 (For reporting periods commencing on or after 1 July 2009)

AASB 2008-6 Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project (For reporting periods commencing on or after 1 July 2009)

AASB 2008-7 Amendments to Australian Accounting Standards – Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate (For reporting periods commencing on or after 1 July 2009)

AASB Interpretation 15 Agreements for the Construction of Real Estate (For reporting periods commencing on or after 1 January 2009)

AASB Interpretation 16 Hedges of a Net Investment in a Foreign Operation (For reporting periods commencing on or after 1 October 2008)

AASB 2008-8 Amendment to IAS 39 Financial Instruments: Recognition and Measurement (For reporting periods commencing on or after 1 July 2009)

AASB Interpretation 17 Distribution of Non-cash Assets to Owners and AASB 2008-13 Amendments to Australian Accounting Standards arising from AASB Interpretation 17

It is considered that the impact of these new Standards and Interpretations in future periods will have no material impact on the financial report of the Company.


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

2

2009

2008

$’000

$’000

16,883

14,986

16,883

14,986

50

69

344

94

1,413

1,712

1,807

1,875

18,690

16,861

Other operating income

1,627

465

Savings in settlement with Fulton Hogan

2,713

-

4,340

465

Profit/(loss) from operations (a) Revenue from continuing operations Revenue from rendering of services

Investment income Bank deposits Held-to-maturity investments NSW Treasury Corporation Hour-Glass cash facility

(b) Other income

Last year an accrual of $7.05m was done to reflect the final settlement with Fulton Hogan on the NICTA Building project. The negotiated settlement resulted in a savings of $2.7m.

(c) Contributions Contribution received from the parent entity for the construction of the Padestrian/Cycle bridge.

-

2,500

-

2,500 AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

The contribution received from the parent entity was invested with NSW Treasury Corporation in the “Hour-Glass”cash facility in the prior year.

43


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

2

2009

2008

$’000

$’000

Advertising and promotion

397

378

Conferencing cost of sales

1,742

2,207

69

79

163

162

Property expenses

2,701

1,846

Repairs and maintenance

1,628

1,290

(d) Other expenses

Printing, stationery and subscriptions IT software and maintenance

Cleaning

277

257

Security

668

650

Telephones

120

165

Insurance

114

113

Legal

382

133

Operating lease costs

863

863

Others

370

417

9,494

8,560

2,759

3,025

268

254

3,027

3,279

(e) Finance Costs Interest on loan from parent entity Interest on obligations under finance leases Total interest expenses (f)

Changes in fair value of Investment Property

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

During the year the investment proprety was revalued and a valuation loss of $10.4m has been booked in the accounts (note 5).

44

(g)

Land Remediation costs Land remediation costs incurred on the Channel seven site and the associated public domain works has been expensed by the Company.

(h)

Grants given to parent The grants received by the Company in the prior year for the Eveleigh Heritage walk has been returned back to the parent during the current year. The parent used the grant money for the purchase of the Little Eveleigh Street property which is a strategic purchase associated with the Redfern Station redevelopment.


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

3

2009

2008

$’000

$’000

741

665

30,324

26,162

31,065

26,827

Cash and cash equivalents Cash on hand and at bank NSW Treasury Corporation “Hour-Glass” cash facility

In the current year, the Company placed surplus cash in the NSW Treasury Corporation’s “Hour-Glass” cash facility. The investment is represented by a number of units of a management investment pool with each particular pool having different horizons and being comprised of a mix of asset classes appropriate to that investment horizon. NSW Treasury Corporation appoints and monitors the application of appropriate investment guidelines. The investment is generally able to be redeemed daily by 11am. The value of the investment held can decrease as well as increase depending on market conditions. The value of the above investment represents the Company’s share of the value of the underlying assets of the facility, and those assets as stated at net value. The weighted average rate of return on these investments during the year was 5.35% (2008: 6.82%). 4

Trade and other receivables Current Trade receivables (i)

420

1,103

Loan receivable (ii)

378

352

( 64)

( 64)

734

1,391

-

552

127

1,026

-

42

861

3,011

4,186

4,564

4,186

4,564

Allowance for impairment

Amounts due from related parties Goods and services tax recoverable Other receivables

Non-current

(i)

The average credit period extended by the Company on rental payments and on conference activity services is 7 days. No interest is charged on the overdue invoices. Of the total $420k (2008 - $1,103k) of the Company’s trade receivables, $219k (2008 - $148k) are current with an average of 3 days. Management considers that there are no indications as of the reporting date that the debtors will not meet their payment obligations with one exception and appropriate action is being taken against the relevant customer. An allowance has been made for estimated irrecoverable trade receivable amounts arising from the past rendering of services, determined by reference to past default experience. The Company reviews all its debts irrespective of the age and a provision for debts if necessary is made in the books.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Loan receivable (ii)

45


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

4

(i)

2009

2008

$’000

$’000

64

64

1

2

Bad debts written off

(1)

(2)

Balance at end of financial year

64

64

Movement in allowance for impairment during the period: Balance at beginning of financial year Impairment losses recognised on receivables

Space at the ATP is leased to new customers who fit the selection criteria and the Company also has a policy of collecting 3-6 months rental as bond before the commencement of the lease. The customers in the conference centre normally pay almost 90% of the total event invoice in advance of the event happening. Of the trade receivables balance at the end of the year, $61k (2008 - $61k) is due from General Governement entities, which makes up 14 % (2008 - 5%) of the total balance of trade receivables and $32k (2008 - $10k) is due from Public Trading Enterprises, amounting to 7 % of trade receivables balance (2008 - 1%). Included in the Company’s trade receivable balances are debtors with a carrying amount of $161k (2008 - $921k) which are past due at the reporting date for which the Company has not provided as there has not been significant change in credit quality and the amounts are still considered recoverable. The Company does not hold collateral over these balances. Ageing of past due but not impaired Less than 3 months overdue

147

881

3 to 6 months overdue

46

7

more than 6 months overdue

32

97

225

985

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

A payment plan arrangement is in place with debtors totalling $39k and the Company is certain that all of that debt will be recovered during the year. The Company meets with these debtors on a regular basis to make sure that the debt is paid on time.

46

In determining the recoverability of a trade receivable, the Company considers any change in the credit quality of the trade receivable from the date credit was initially granted up to the reporting date. The concentration of credit risk is limited due to the customer base being large and unrelated. Included in the allowance for impairments are individually impaired trade receivables of $64k.


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

4

(i)

2009

2008

$’000

$’000

-

-

3 to 6 months overdue

42

2

more than 6 months overdue

22

62

Total

64

64

Ageing of impaired trade receivables Less than 3 months overdue

(ii)

5

Loans receivable represents the fitout costs receivable from the Department of Defence over the term of lease of 10 years. The fixed interest rate is 7.23 % per annum and the maturity date is 30 May 2018. Management considers that the carrying amount of the loan best represents the maximum credit risk exposure at the balance sheet date and that there is no indication at that date that the counterparty will not meet its obligations.

Investment Property At fair value Balance at the beginning of financial year Addition from subsequent expenditure Net gains/(loss) from fair value adjustment Balance at the end of financial year

75,100

31,500

-

41,095

( 10,460)

2,505

64,640

75,100

The fair value of the Company’s investment property at 31 May 2009 (previous valuation on 31 May 2008) has been arrived at on the basis of a valuation carried out at that date by Preston Rowe Paterson NSW Pty Limited (“PRP”), independent valuers not related to the Company. PRP are members of the Australian Institute of Valuers, and they have the appropriate qualifications and recent experience in the valuation of properties in the relevant locations. The valuation, which conforms to Australian Valuation Standards, was arrived at by reference to market evidence of transaction prices for similar properties.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT 47


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

6

2009

2008

$’000

$’000

20,387

17,520

( 720)

( 1,686)

19,667

15,834

At gross value

1,051

990

Accumulated depreciation

( 946)

( 919)

105

71

1,601

2,202

( 1,262)

( 1,668)

339

534

At gross value

5

5

Carrying amount at fair value

5

5

22

-

23,066

20,717

( 2,928)

( 4,273)

20,138

16,444

Property Plant & Equipment Leasehold improvements At gross value Accumulated depreciation Carrying amount at fair value Furniture and fittings

Carrying amount at fair value Plant and equipment At gross value Accumulated depreciation Carrying amount at fair value

Art and artefacts

Work in Progress Total Property, plant and equipment At gross value ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Accumulated depreciation

48

Carrying amount at fair value


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

6A

Reconciliation of Property Plant and Equipment

Leasehold improvements

Furniture and fittings

Plant and equipment

Art and artefacts

Work in process

Total

2,633

990

1,725

5

39,445

44,798

( 1,556)

( 794)

( 1,447)

-

-

( 3,797)

1,077

196

278

5

39,445

41,001

1,077

196

278

5

39,445

41,001

-

-

-

-

17,020

17,020

14,887

-

483

-

( 56,465)

( 41,095)

-

-

( 1)

-

-

( 1)

( 130)

( 125)

( 226)

-

-

( 481)

15,834

71

534

5

-

16,444

17,520

990

2,202

5

-

20,717

( 1,686)

( 919)

( 1,668)

-

-

( 4,273)

15,834

71

534

5

-

16,444

15,834

71

534

5

-

16,444

9,625

62

-

-

87

9,774

34

-

31

-

( 65)

-

( 5,500)

-

-

-

-

( 5,500)

( 326)

( 28)

( 226)

-

-

( 580)

19,667

105

339

5

22

20,138

20,387

1,051

1,601

5

22

23,066

( 720)

( 946)

( 1,262)

-

-

( 2,928)

19,667

105

339

5

22

20,138

At 1 July 2007 Cost or fair value Accumulated Depreciation Net book amount

Year ended 30 June 2008 Opening net book amount Additions Transfer in/(out) Assets write offs Depreciation Closing net book amount

At 30 June 2008 Cost or fair value Accumulated Depreciation Net book amount

Year ended 30 June 2009 Opening net book amount Additions Transfer in/(out) Assets write offs Closing net book amount At 30 June 2009 Cost or fair value Accumulated Depreciation Net book amount

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Depreciation

49


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

7

Intangible assets Software At 1 July 2007 Cost or fair value Accumulated amortisation Net book amount

94 ( 66) 28

Year ended 30 June 2008 Opening net book amount Additions Amortisation Closing net book amount

28 172 ( 63) 137

At 30 June 2008 Cost or fair value Accumulated amortisation Net book amount

266 ( 129) 137

Year ended 30 June 2009 Opening net book amount Additions Amortisation Closing net book amount

137 59 ( 71) 125

At 30 June 2009

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Cost or fair value

50

Accumulated amortisation Net book amount

325 ( 200) 125


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

8

2009

2008

$’000

$’000

470

369

470

369

2,095

1,910

2,095

1,910

Lease Incentive Current lease incentive asset Lease incentive granted to lessees

Non-current lease incentive asset Lease incentive granted to lessees

9

Trade and other Payables Current Trade Payables and accruals (i)

1,769

10,766

Amounts payable to parent entity (ii)

418

-

Event and tenant deposits

952

1,028

Lease Incentive - Deferred income

88

244

Other Payables

90

118

3,317

12,156

(i)

The average credit period on purchase of services is 30 days. No interest has been paid in the current year. The Company has financial risk management policies in place to ensure that all payables are paid within the credit timeframe.

(ii)

Refer to note 18 (c) for terms and conditions Non-Current Deferred lease revenue

9,625

-

9,625

-

10

Current Provisions Annual leave

11

203

162

Long Service leave

52

36

Remediation Costs

1,079

1,550

1,334

1,748

32

28

Non-Current Provisions Long service leave

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Deferred lease revenue pertains to the right of ATP to receive 350 car spaces as a part of the Channel 7 development at $35,000 per car space. This will be amortised over the term of the lease (88 years) granted to ATP Partnership.

51


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

12

2009

2008

$’000

$’000

378

352

378

352

4,186

4,564

39,996

35,610

5,068

4,801

49,250

44,975

Borrowings Current Loan from parent entity - 10 year fixed interest

Non-Current Loan from parent entity - 10 year fixed interest Loan from parent entity at variable rates Finance lease liability (Note 16b)

The loan from the parent entity is taken to fund the construction of Building D. A loan agreement is in place and the Company pays commercial rates of interest to the parent entity. The company paid 4.9% interest for the current year (2008 7.2%). The total loan facility is for $47.5m. An arrangement is in place between the parent and NSW Treasury Corporation to refinance the loan in June 2010 over 25 years either at fixed interest or a floating interest rate. The management in May 2009 decided to continue with the variable interest rate pending the sale of the Australian Technology Park Precinct Management Limited. The 10 year fixed interest rate loan pertains to the fitout costs recoverable from the Department of Defence over the term of the lease (refer note 4 (ii)). 13

Retained profits Balance at beginning of the year Profit/(Loss) for the year Balance at end of the year

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

14

52

58,034

49,383

( 10,321)

8,651

47,713

58,034

Reconciliation of cash flow statement (a) Reconciliation of cash and cash equivalents For the purposes of the cash flow statement, cash includes cash on hand and in banks and liquid investment in NSW Treasury Corporation “Hour-Glass” cash facility. Cash at the end of the financial year as shown in the statement of cash flows is reconciled to the related items in the balance sheet as follows:

Cash and cash equivalents (Note 3)

31,065

26,827

31,065

26,827


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

2009

2008

$’000

$’000

( 10,321)

8,651

5,500

1

651

544

10,460

( 2,505)

267

254

( 286)

117

862

863

1

2

7,134

7,927

2,527

( 1,060)

( 8,839)

3,413

( 410)

1,630

412

11,910

4,664

1,551

14 (b) Reconciliation of profit/(loss) for the year to net cash flows from operating activities Net (loss)/profit for the year Adjustments for non-cash items Asset Write Offs Depreciation and amortisation Change in fair value of investment property measured at fair value through income statement Unwinding of discount related to finance lease liability Recognition of operating lease incentive in accordance with UIG Interpretation 115 Operating Lease Allowance for impairment on receivables Net profit before working capital changes Changes in net assets and liabilities: (increase)/decrease in Trade and other receivables increase/(decrease) in Trade and other payables increase/(decrease) in provisions Net cash flows from operating activities 15

Commitments for expenditure Contracted as at balance date (inclusive of GST) Payable within one year

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

The above includes GST of $424K that is expected to be recoverable from the Australian Taxation Office. The Capital expenditure commitments relate to the public domain works and the Energy Australia High Voltage Infrastructure on the Channel 7 site.

53


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

16

2009

2008

$’000

$’000

Leases (a) Disclosures for the Company as lessor Operating leases Operating leases relate to the investment property referred to in Note 5 to the financial statements. Lease terms range between three and five years, with no option to extend. All operating lease contracts contain market review clauses in the event that the Company exercises its option to renew. The lessee does not have an option to purchase the property at the expiry of the lease period.

Non-cancellable operating lease receivables Not later than one year

14,192

10,473

Later than one and not later than five years

36,703

25,285

Later than five years

34,431

26,419

Total including GST

85,326

62,177

The above includes GST output tax of $7.75m that is expected to be paid to the Australian Taxation Office. The income commitments relate to rent leases. All receivable leases are entered into at commercial rates and terms. Regular market valuations and tendering processes are carried out to ensure commercial arrangements are maintained. In respect of non-cancellable operating leases the following have been recognised: Current Lease incentive asset (note 8)

470

369

2,095

1,910

Non-current

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Lease incentive asset (note 8)

54


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

2009

2008

$’000

$’000

16 (b) Disclosures for the Company as lessee Operating leases Operating leases relate to the heritage land and buildings with lease term of 99 years. The Company does not have an option to purchase the leased asset at the expiry of the lease period. Non-cancellable operating lease payments Not later than one year

-

-

Later than one and not later than five years

-

-

68,225

68,225

68,225

68,225

( 11,931)

( 11,069)

Later than five years

In respect of non-cancellable operating leases the following have been recognised: Non-current - other liability Operating lease payable in arrears

Finance leases Finance leases relate to the Bio-medical buildings with lease term of 99 years. The Company does not have an option to purchase the leased asset at the expiry of the lease period. Minimum lease payments, later than 5 years * Less: Future finance charges Present value of minimum lease payments

30,525

30,525

( 25,457)

( 25,724)

5,068

4,801

5,068

4,801

Included in the financial statements as:

* Minimum future lease payments includes the aggregate of all lease payments and any guaranteed residual.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Non-current finance lease liability (Note 12)

55


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

17

2009

2008

$’000

$’000

65

56

111

132

176

188

Auditor’s Remuneration The auditor of the Company is The Audit Office of NSW

a

Amount received or due and receivable by the Audit Office of NSW for: an audit of the financial report of the entity.

b

Amount received or due and receivable by other organisations for: other non audit services (Internal audit, accounting and probity services)

18

Directors and Executive Disclosure a

Details of Key Management Personnel i Directors Dr Colin Gellatly AO - Chairman Mr Michael Collins Mr Richard Johnson Ms Lucy Hughes Turnbull Ms Ann Weldon Mr John Mulally Mr Roy Wakelin-King - Managing Director (appointed 16 February 2009) Mr Robert Domm - Managing Director (resigned 28 November 2008)

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Ms Mohini Nair - Acting Managing Director (Period from 29 November 2008 to 13 February 2009)

56

ii Executives Mr Chris Saunders - General Manager Mr Sanjeev Goyal - Executive Manager Business & Finance Mr Graham Stevens - Asset Manager Ms Ruby Chronis - Director of Marketing & Sales Ms Ariana Aljinovic - Markets Manager


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

18 b

Compensation of Key Management Personnel Directors Compensation Directors did not receive any remuneration from the Company during the financial year ended 30 June 2009. Directors did not receive any loans or advances or other forms of compensation during the financial year. Executive Compensation Objective The Company aims to reward executives with a level and mix of compensation commensurate with their position and responsibilities within the Company as to - reward executives for Company, business unit and individual performance against targets set by appropriate benchmarks; - link rewards with the strategic goals and performance of the Company; and - ensure total compensation is competitive by market standards. The Managing Director of the Company does not get paid by the company. He is also the CEO of the Redfern-Waterloo Authority (parent) and gets remunerated by the parent.

c

Related Party Disclosures Terms and conditions of transactions with related parties Sales to and purchases from related parties are made in arm’s length transactions both at normal market prices and on normal commercial terms. The Directors or Executives of the Company do not currently hold or have held positions with organisations that the Company had dealings with. Compensation of current key management personnel: Superannuation

Performance related bonus

$’000

$’000

$’000

1

50-100

1-10

1-10

4

100-150

10-20

10-50

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

Salary

Number

57


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

19

Segment reporting The Company’s primary segment reporting format is business segments as the Company’s risks and returns are affected predominantly by differences in the services produced and the Company only operates in one geographical area, Sydney, Australia. For management reporting purposes, the Company is organised into two divisions - property management and conferencing. Property management involves the development and management of operating land and building assets in the Sydney Metropolitan area. Conferencing involves the provision of multi-purpose meeting rooms and spaces for corporate conferences and special events. The following table presents revenue and result information and certain asset and liability information regarding business segments for years ended 30 June 2009 and 2008.

Property Management

External segment revenue Segment result Segment assets Segment liabilities

Conferencing

Unallocated Corporate

Total

2009

2008

2009

2008

2009

2008

2009

2008

$ 000

$ 000

$ 000

$ 000

$ 000

$ 000

$ 000

$ 000

18,916

15,123

4,114

4,703

-

-

23,030

19,826

7,792

11,149

1,524

1,641

(19,637)

(4,139)

(10,321)

8,651

121,479

126,360

2,101

2,002

-

-

123,580

128,362

14,151

13,628

532

655

61,184

56,044

75,867

70,328

590

483

61

61

-

-

651

544

9,774

17,020

-

-

-

-

9,774

17,020

Other Segment Information: - Depreciation - Acquisition of property, plant and equipment and intangible assets

Financial risk management

20

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

(a)

58

Market Risk Market risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in market prices. The exposures of the Company to market risk are primarily through interest rate risk on borrowings and other price risks associated with the movement in the unit price of the Hour Glass Investment facilities. The Company have no exposure to foreign currency risk and do not enter into commodity contracts. The effect on the reported result and equity due to a reasonably possible change in risk variable is outlined in the information below, for interest rate risk and other price risk. A reasonably possible change in risk variable has been determined after taking into account the economic environment in which the Company operate and the time frame for the assessment (i.e. until the end of the next annual reporting period). The sensitivity analysis is based on risk exposures in existence at the balance sheet date. The analysis is performed on the same basis in 2008. The analysis assumes that all other variables remain constant.


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

20

(b) Capital risk management

The Company manages its capital to ensure that it will be able to continue as a going concern while maximising the return to its parent. The Company’s overall strategy remains unchanged from 2008. The capital structure of the Company consists of debt, which includes the borrowing from the Company’s parent disclosed in note 12. (c)

Financial risk management objectives The Company’s principal financial instruments comprise cash and short term deposits, finance lease liabilities and loans rom its parent. The main purpose of these financial instruments is to fund Company’s operations. The Company has various other financial instruments such as debtors and trade creditors, which arise directly from its operations. It is, and has been throughout the period under review, the Company’s policy that no trading in financial instruments shall be undertaken. The main risks arising from the Company’s financial instruments are interest rate risk, liquidity risk and credit risk. The executive reviews and agrees policies for managing each of these risks and they are summarised below.

(d) Interest rate risk

The Company is exposed to interest rate risk as it borrows at floating interest rates from its parent entity and holds surplus cash in NSW Treasury Corporation “Hour-Glass” cash facilities. NSW Treasury Corporation as trustee for the above facility is required to act in the best interest of the unit holders and to administer the trusts in accordance with the trust deeds. As trustee, the NSW Treasury Corporation has appointed external managers to manage the performance and risks of each facility in accordance with a mandate agreed by the parties. The Company’s exposure to interest rate risk arising from the above is disclosed in notes 3 and 12. Interest rate sensitivity The sensitivity analysis below have been determined based on the exposure to interest rates for the financial instruments held by the Company at the reporting date and the stipulated change taking place at the beginning of the financial year and held constant throughout the reporting period. A 1% increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management’s assessment of the possible change in interest rates.

(e)

Credit risk Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in losses to the Company. The credit quality of trade and other receivables and the credit risk management policy in respect of such financial assets are disclosed in note 4. No credit risk arises on the Company’s investments in Hour-Glass cash facilities with the NSW Treasury as these represent the Company’s share of the net asset value of the facility.

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

At reporting date, if interest rates had been 1% higher or lower and all other variables were held constant, the Company’s net profit would decrease by $96k and increase by $96k (2008 - decrease by $70k and increase by $70k). This is mainly attributable to the Company’s exposure to interest rate risk on its variable borrowings from its parent and its investments in “Hour-Glass” facilities from the NSW Treasury Corporation.

59


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

20

(f)

Liquidity risk Liquidity risk arises from the possibility that the Company may be unable to settle a transaction on the due date. The Company’s objective is to maintain a satisfactory level of liquidity. The Company has no significant borrowings for the day to day operations. The Company borrows money only for the purpose of capital projects which is through its parent entity. Liquidity and interest risk tables The following tables detail the Company’s remaining contractual maturity for its non-derivative financial liabilities. The tables have been drawn up based on the undiscounted cash flows of financial liabilities based on the earliest date on which the Company can be required to pay. The table includes both interest and principal cash flows and spot rates at the year end have been used to project interest payments for variable rate loans.

Weighted average effective interest rate

Less than 1 year

1-5 years

5+ years

%

$000

$000

$000

1,769

-

-

2009 Non-interest bearing trade payables Fixed rate loan from parent

7.23%

754

2,785

2,726

Variable rate loan from parent

4.90%

40,107

-

-

Finance Lease Liability

5.50%

-

-

30,525

42,630

2,785

33,251

10,766

-

-

2008

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Non-interest bearing trade payables

60

Fixed rate loan from parent

7.23%

696

2,785

3,423

Variable rate loan from parent

7.20%

37,672

-

-

Finance Lease liability

5.50%

-

-

30,525

49,134

2,785

33,948

As disclosed in note 12, an arrangement is in place between the parent and the NSW Treasury Corporation to refinance the loan in June 2010 over 25 years either at fixed interest or a floating interest rate. The 10 year fixed interest rate loan pertains to the fitout costs recoverable from the Department of Defence over the term of the lease (refer note 4 (ii)).


FINANCIAL STATEMENT :

Notes to the Financial Statement For The Financial Year Ended 30 June 2009

20

2009

2008

$’000

$’000

(g) Net fair values of financial assets and liabilities

The fair value of financial assets and liabilties are determined in accordance with generally accepted pricing models based on discounted cash flow analysis using prices from observable current market transactions. The carrying amount of financial assets and financial liabilities recorded in the financial statements approximate their net fair values. 21

Contingent Assets and Liabilities The Company has exemptions for rates and taxes from relevant authorities. These exemptions are currently under internal review to ascertain their currency and applicability. This review process may result in liabilities being payable by the Company, however the Company is not able to reliably measure these amounts, if any.

22

Related party transactions and balances The Company is a wholly owned subsidiary of the Redfern-Waterloo Authority. The balances outstanding at the end of the year and the value of the transactions with the related paries during the year are set out in the table below: Related party balances Receivable from the Authority

-

552

Payable to the Authority

418

-

Loans from the Authority

49,628

45,327

96

96

Contributions received/(paid) from/to the parent entity

( 2,500)

2,500

Interest paid to the parent entity on the loan

( 2,759)

( 3,025)

Related party transactions Accounting services provided to the parent entity

Events after the balance sheet date The Company has not identified any events or transactions after the balance sheet date that are material to require adjustments or disclosure in the financial report.

END OF AUDITED FINANCIAL STATEMENTS

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT

23

61


APPENDICES

Where appropriate, these appendices relate to the Authority, which wholly owns the Company.

Consultants Consultants up to $30,000

Nil

Consultants over $30,000

Nil

TOTAL

Nil

Corporate Credit Cards

Disability Access Plan

Three Company Staff members hold corporate credit cards. The credit limit is $5,000 as approved by the Company Board. The Company applies the Corporate Credit Card Policy, which meets NSW Treasury’s guidelines. Cardholders are required to observe the policy and complete a monthly reconciliation report.

Under the disability access policy, the Company aims to provide all people with reasonable access to the resources and spaces governed by the company. This includes providing adequate parking places and ease of movement throughout the park.

Risk Management and Insurance The Company is covered for workers compensation, motor vehicle accidents, property loss, public liability and various other insurable risks through its parent organisation which makes contribution to the Treasury Managed Funds. It is a requirement that all suppliers to the Company have the appropriate insurance coverage, including public liability, professional indemnity and product risk.

Consumer Response

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

The Company is committed to handling public enquiries courteously and efficiently and, in the case of complaints, to responding to issues quickly, equitably and in accordance with procedures detailed in Complaints Handling Policy, which it applies to its operations.

62

The Company management will work closely with the Disability Access Advisory Group of the Authority to continually improve access for visitors, residents and workers within its precincts.

Ethnic Affairs Priorities Statement The Company recognises and values the different linguistic, religious, racial and ethnic backgrounds of all the people of NSW and endorses the four principles of multiculturalism as set out in the Community Relations Commission and Principles of Multuculturalism Act 2000. The Company complies with and endorses the provisions of the Equal Employment Opportunity legislation, which forms part of the NSW Anti-Discrimination Act 1977. Staff come from a broad range of ethnic backgrounds, and are encouraged to use their language skills, particularly in relation to hosting international delegations. Total Employees 17 Male Employees 8 Female Employees 9 Ethnic background 10 Males Senior Management Positions 3 Female Senior Management Positions 2


Freedom of Information No Freedom of Information requests were received.

Occupational Health, Safety and Rehabilitation Policy The Company applies Occupational Health, Safety and Rehabilitation Policy to its operations. It’s commitment to OHS&R is set out in this policy. The company is committed to the occupational health, safety and welfare of all its employees, those contracted to perform work on its behalf and visitors to its premises. Because the Company undertakes such a diverse set of day-to-day activities, ranging from staging major events to hosting international delegations, the environments in which we work are broad. This presents a bigger challenge than many workplace environments. The Company is committed to zero accidents and actively fosters an atmosphere that promotes a duty of care to co-workers, customers, contractors and visitors to the Australian Technology Park.

Waste Reduction and Purchasing Policy

Copies of the the Company’s Annual Report

The Government’s Waste Reduction and Purchasing Policy (WRAPP) requires all State Government agencies to develop and implement a WRAPP Plan to reduce waste and increase purchases of recycled content materials where they are both cost and performance competitive

This is the ninth Annual Report for the Company. The total cost for external production and printing totalled $31,431 (inc GST). It is available on the Company’s and the Authority’s websites:

Whilst the Company is a company limited by guarantee governed by Corporations Act, it is a wholly owned subsidiary of a government sector agency – The Redfern-Waterloo Authority. The Company Management regard it as prudent to integrate relevant public sector principles and policies of sustainable environment management into its operations. The Company’s environmental policy underpins its commitment to the principles of ecologically sustainable development in the provision of its services.

www.atp.com.au www.redfernwaterloo.nsw.gov.au

Contact Details Australian Technology Park Precinct Management Limited Bay 4, Locomotive Workshop Eveleigh NSW 1430 Phone: Facsimile:

(02) 9209 4220 (02) 9209 4222

Office hours:

8.30am to 5.30pm Monday to Friday

ISSN: 1445-7369

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT 63


INDEX

Appendices

62 Financial Statement

Auditor’s Independence Declaration

29 Managing Director

05

Beyond ATP

22 Heritage

14

Board Members

06 Independent Auditor’s Report

30

Charter

02 Index

64

Conference & Exhibition Centre

18 Management & Achievements

11

Corporate Governance

08 Minister’s Letter

04

Directors’ Declaration

28 Notes to Financial Statement

36

Directors’ Report

24 & Performance

32

From the Chairman &

ANNUAL REPORT AUSTRALIAN TECHNOLOGY PARK

Operational Structure

64

10


Designed and Produced by:

Art Director: Imelda Dickinson Designer: John Liang Photography: TLP Studios D. Linnet

AUSTRALIAN TECHNOLOGY PARK ANNUAL REPORT 65


AUSTRALIAN TECHNOLOGY PARK PRECINCT MANAGEMENT LIMITED Phone: (02) 9209 4220 Fax: (02) 9209 4222

WWW. ATP.COM.AU


ATP Annual Report