Multiple Sclerosis Society of the ACT Incorporated FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2007

Transcription

1 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2007

2 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2007 CONTENTS Committee s Report Independent Audit Report Income Statement Balance Sheet Statement of Cash Flows Notes to the Financial Statements Statement by Members of the Committee Auditor's Disclaimer

3 COMMITTEE S REPORT Your committee members submit the financial report of the Multiple Sclerosis Society of the ACT Incorporated for the financial year ended 30 June Committee Members The names of committee members throughout the year and at the date of this report are: Don Cross Tracey Cross Dr Katy Gillette Oscar Hughes, AO Katrina Muir Ian Pennell, AM R G (Jim) Quick David Robertson Alan Sims Dr Mary Webb Principal Activities The principal activities of the Society during the financial year were: - to provide information on Multiple Sclerosis (MS), counselling, immunotherapy training and support and employment facilitating activities; - to provide advice, emotional support, information and referral to other services; - to operate a library; - to provide loans of aids and appliances; - to educate the public; - fundraising in support of the Society; and - to contribute financially to MS research. Significant Changes There were no significant changes in the nature of these activities during the financial year. Operating Result The surplus from ordinary activities amounted to $70,067 (2006:$7,465). Signed in accordance with a resolution of the Members of the Committee. I Pennell, AM President D Cross Treasurer Dated this 23 rd day of August, 2007

4 INDEPENDENT AUDIT REPORT TO THE MEMBERS OF MULTIPLE SCLEROSIS SOCIETY OF THE ACT INCORPORATED Scope The financial report and committees responsibility The financial report compromises the balance sheet, income statement, cash flow statement, statement of change in equity, accompanying notes to the financial statements, and the statement by members of the committee for the Multiple Sclerosis Society of the ACT Incorporated, for the year ended 30 June The committee of the association is responsible for the preparation and true and fair presentation of the financial report in accordance with the Associations Incorporations Act (1991, ACT). This includes responsibility for the maintenance of adequate accounting records and internal controls that are designed to prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the financial report. Audit Approach We conducted an independent audit in order to express an opinion to the members of the association. Our audit was conducted in accordance with Australian Auditing Standards, in order to provide reasonable assurance as to whether the financial report is free of material misstatement. The nature of an audit is influenced by factors such as the use of professional judgement, selective testing, the inherent limitations of internal control, and the availability of persuasive rather than conclusive evidence. Therefore, an audit cannot guarantee that all material misstatements have been detected. We performed procedures to assess whether in all material respect the financial report presents fairly, in accordance with the Associations Incorporations Act (1991, ACT), including compliance with Accounting Standards and other mandatory financial reporting requirements in Australia, a view which is represented by the results of its operations and cash flows. We formed our audit opinion on the basis of these procedures, which included: - examining, on a test basis, information to provide evidence supporting the amounts and disclosures in the financial report; and - assessing the appropriateness of the accounting policies and disclosures used and the reasonableness of significant accounting estimates made by the committee. While we considered the effectiveness of management s internal controls over financial reporting when determining the nature and extent of our procedures, our audit was not designed to provide assurance on internal controls. Independence In conducting our audit, we followed applicable independence requirements of Australian Professional ethical pronouncements.

5 Qualification As is common for organisations of this type, it is not practicable to maintain an effective system of internal control over donations and fund-raising activities until their initial entry in the accounting records. Accordingly, our audit in relation to those activities was limited to amounts recorded. Qualified Auditor s Opinion In our opinion, except for the effects on the financial report of the matter referred to in the qualification paragraph, the financial report of Multiple Sclerosis Society of the ACT Incorporated represents a true and fair view in accordance with applicable Accounting Standards and other mandatory professional reporting requirements in Australia, the financial position of Multiple Sclerosis Society of the ACT Incorporated as at 30 June 2007 and the results of its operations and its cash flows for the year then ended. Canberra, Australian Capital Territory RSM Bird Cameron Chartered Accountants Dated: 27 th August 2007 Ged Stenhouse Director

6 INCOME STATEMENT YEAR ENDED 30 JUNE 2007 Note $ $ Revenue 2 Services to People with MS 231, ,140 Car Raffles 435, ,284 MS Readathon 76,901 66,531 Other Fundraising 174, ,045 Gloria McKerrow House 65,232 3,359 The Cottage 16,922 16,289 Administration 32,038 16,584 1,032, ,232 Expenses Services to People with MS 267, ,215 Car Raffles 352, ,802 Other Fundraising 80,313 69,891 Gloria McKerrow House 28,095 19,418 The Cottage Administration 201, ,638 Depreciation 32,027 33, , ,767 Surplus before income tax expense 3 70,067 7,465 Income tax expense Net surplus after income tax expense attributable to the Society 70,067 7,465 The accompanying notes form part of this financial report Detailed Income and Expenditure Statements by function are available on request, or for inspection at the Registered Office

7 BALANCE SHEET AT 30 JUNE 2007 Note $ $ Current assets Cash assets 5 435, ,278 Receivables 6 50,478 64,951 Prepaid expenses 7 9,772 8,585 Total current assets 496, ,814 Non-current assets Property, plant and equipment 8 579, ,018 Other financial asset 9 26,707 26,707 Total non-current assets 606, ,725 Total assets 1,102,831 1,037,539 Current liabilities Payables 10 30,639 47,906 Provisions 11 32,748 20,256 Total current liabilities 63,387 68,162 Total liabilities 63,387 68,162 NET ASSETS 1,039, ,377 EQUITY Retained surplus 1,039, ,377 TOTAL EQUITY 1,039, ,377 The accompanying notes form part of this financial report

8 STATEMENT OF CHANGES IN EQUITY YEAR ENDED 30 JUNE 2007 Note Retained Total Reserves Surpluses Equity $ $ $ At 1 July , ,912 Surplus for the year - 7,465 7,465 At 30 June , ,377 Surplus for the year - 70,067 70,067 At 30 June ,039,444 1,039,444 The accompanying notes form part of this financial report

9 CASH FLOW STATEMENT YEAR ENDED 30 JUNE 2007 Cash flows from operating activities Note $ $ Receipts from members, customers & donors 924, ,269 Operating grant receipts 156,944 75,831 Interest received 24,867 20,252 Payments to suppliers and employees (995,843) (895,443) Net cash provided from/ used in operating activities13(b) 110,605 (10,091) Cash flows used in investing activities Fixed asset purchases (98,897) (2,066) Net cash used in/ from investing activities (98,897) (2,066) Net increase (decrease) in cash held 11,708 (12,157) Cash at the beginning of the financial year 424, ,435 Cash at the end of the financial year 13(a) 435, ,278 The accompanying notes form part of this financial report

10 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 1: Statement of Significant Accounting Policies This financial report is a general purpose financial report that has been prepared in accordance with Australian Accounting Standards and other authoritative pronouncements of the Australian Accounting Standards Board and the requirements of the Associations Incorporations Act (ACT). The financial report covers the Multiple Sclerosis Society of the ACT Incorporated as an individual entity. The Multiple Sclerosis Society of the ACT Incorporated is an association incorporated in the Australian Capital Territory under the Associations Incorporation Act The following is a summary of the material accounting policies adopted by the association in the preparation of the financial report. The accounting policies have been consistently applied, unless otherwise stated. Basis of Preparation The accounting policies set out below have been consistently applied to all years presented. The entity has however elected to adopt the exemptions available under AASB 1 relating to AASB 132: Financial Instruments: Disclosure and Presentation, and AASB 139: Financial Instruments: Recognition and Measurement. Reporting Basis and Conventions The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

11 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 1: Statement of Significant Accounting Policies (continued) (a) Property, Plant and Equipment Each class of property, plant and equipment is carried at cost or fair value, less any accumulated depreciation and impairment losses. Property Whilst leasehold land and buildings are carried at cost, revaluations are carried out from time to time and the most recent valuation amount reported in the notes to the accounts. Plant and Equipment Plant and equipment are measured on the cost basis less depreciation and impairment losses. The carrying amount of plant and equipment is reviewed annually by the Society to ensure it is not in excess of the recoverable amount of those assets. The recoverable amount is assessed on the basis of the expected net cash flows, which will be received from the assets employment and subsequent disposal. The expected net cash flows have been discounted to their present values in determining recoverable amounts. Depreciation The depreciable amount of all fixed assets are depreciated on a straight line basis over the useful life of the assets to the Society commencing from the time the asset is held ready for use. Leasehold improvements are depreciated over the estimated useful life of the improvements. The depreciation rates used for each class of depreciable asset are: Class of Fixed Asset Depreciation Rate Leasehold buildings 2.5% Furniture and fittings 10% to 20% Plant and equipment 10% to 33.33% (b) MS Readathon Expenses MS Readathon continues to be managed nationally by Multiple Sclerosis Australia. The Society received a net distribution from Multiple Sclerosis Australia of $76,901 in the 2006/2007 financial year. (c) Sundry Debtors Invoices issued and outstanding at 30 June 2007 are shown as debtors in the balance sheet. They are direct claims to cash inflows which are expected to occur when customers pay their accounts Credit card transactions which have been processed by the Society but have not been received in bank accounts are also shown here.

12 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 1: Statement of Significant Accounting Policies (continued) (d) Employee Entitlements Provision is made for the society s liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability is settled, plus related on-costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits. Contributions are made by the association to an employee superannuation fund and are charged as expenses when incurred. (e) Cash For the purposes of the Statement of Cash Flows, cash includes cash on hand, at banks and on deposit. (f) Revenue Revenue from the sale of goods and services is recognised upon delivery to customers. Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets. (g) Fund Accounting In order to ensure observances of limitations and restrictions placed on the use of certain resources available to the Society, its accounts are maintained in accordance with the principals of fund accounting. Resources for various purposes are classified for accounting and reporting purposes into funds established according to their nature and purpose. Separate accounts are maintained for each fund. (h) Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or part of the item of the expense. (i) Impairment of Assets At each reporting date, the Society reviews the carrying values of its tangible and intangible assets to determine whether there is any indication that those assets have been impaired. If such an indication exists, the recoverable amount of the asset, being the higher of the asset s fair value less costs to sell and value in use, is compared to the asset s carrying value. Any excess of the asset s carrying value over its recoverable amount is expensed to the income statement.

13 (j) Critical Accounting Estimates The Society evaluates estimates and judgements incorporated into the financial statements based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the organisation. No accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next accounting period. (k) New standards and interpretations issued but not yet effective At the date of this financial report the following standards and interpretations, which may impact the entity in the period of initial application, have been issued but are not yet effective: Reference Title Summary Applicatio n date (financial years beginning) AASB 7 Financial Instruments: New standard replaces disclosure 1 January AASB Disclosures Amendments to Australian Accounting Standards arising from AASB 7 requirements of AASB 132 Amends AASB 132, AASB 101, AASB 114, AASB 117, AASB 133, AASB 139, AASB 1, AASB 4, AASB 1023, AASB 1038 as a result of issue of AASB 7 AASB 101 Presentation of Financial Statements Revised standard AASB 8 Operating Segments New standard replaces AASB 114 AASB Amendments to Amends AASB 5, AASB 6, Australian Accounting AASB 102, AASB 107, Standards arising from AASB 119, AASB 127, AASB 8 AASB 134, AASB 136, AASB 1023 & AASB 1038 as a result of issue of AASB 8 AASB 123 Borrowing Costs Revised standard requires borrowing costs directly attributable to qualifying assets to be capitalised, where previously they could be immediately expensed. AASB AASB AASB Amendments to Australian Accounting Standards arising from AASB 123 Amendments to Australian Accounting Standards arising from ED 151 and Other Amendments Amendments to Australian Accounting Standards Amends AASB 1, AASB 101, AASB 107, AASB 111, AASB 116 & AASB 138 and Interpretations 1 & 12 as a result of issue of AASB 123 Amends AASB 1, 2, 3, 4, 5, 6, 7, 102, 107, 108, 110, 112, 114, 116, 117, 118, 119, 120, 121, 127, 128, 129, 130, 131, 132, 133, 134, 136, 137, 138, 139, 141, 1023 & 1038 Further amends AASB 1, AASB 2, AASB 4, AASB 5, AASB 107 & AASB 128 as a result of issue of AASB January January January January January January 2009 Expected Impact Disclosures only Disclosures only Disclosures only Disclosures only Disclosures only It is estimated the change will have no material effect It is estimated the change will have no material effect 1 July 2007 It is estimated the change will have no material effect 1 July 2007 Disclosures only

14 AASB AASB AASB Amendments to Australian Accounting Standard Inventories Held for Distribution by Not-for-Profit Entities Amendments to Australian Accounting Standards arising from AASB Interpretation 11 Amendments to Australian Accounting Standards arising from AASB Interpretation 12 Amends AASB 102 to require inventories held for distribution by not-for-profit entities to be measured at cost, adjusted when applicable for any loss of service potential. Amends AASB 2 as a result of issue of AASB Interpretation 11 Amends AASB 1, AASB 117, AASB 118, AASB 120, AASB 121, AASB 127, AASB 131 & AASB 139 as a result of issue of AASB Interpretation 12 1 July March January 2008 It is estimated the change will have no material effect Transitional provisions only it is estimated the change will have no material effect Transitional provisions only it is estimated the change will have no material effect

15 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 2: Revenue $ $ Operating activities - Raffles 421, ,890 - MS Readathon 76,901 66,405 - Donations and Bequests 238, ,385 - Other fundraising 75,125 65,352 - Operating grants 150,565 69,558 - Other sources 45,450 59,034 - Contributions of assets ,007, ,980 Non-operating activities - Interest received 24,867 20,252 Total Revenue 1,032, ,232 Note 3: Surplus Surplus (deficit) has been determined after: Expenses: Depreciation of property, plant and equipment 32,027 33,008 Remuneration of Auditor - audit or review services 6,975 5,975 - other services - - Note 4: Income Tax Expense The Society is exempt from income tax under the provision of Section 50-5 of the Income Tax Assessment Act Note 5: Cash Assets Cash at bank 278, ,486 Cash on deposit 157, ,642 Cash on hand , ,278

16 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 6: Receivables $ $ Net GST receivable 2,930 9,413 Accrued income 4,752 16,459 Sundry debtors 41,690 34,091 Merchandise on Hand 1,106 1,106 Work in Progress Gloria McKerrow House - 3,882 50,478 64,951 Note 7: Prepaid Expenses Sundry prepaid expenses 9,772 8,585 9,772 8,585 Note 8: Property, Plant and Equipment Leasehold land and buildings - at cost 833, ,530 Less accumulated depreciation (311,382) (291,078) 522, ,452 Furniture and fittings at cost 51,387 66,286 Less accumulated depreciation (32,910) (55,005) 18,477 11,281 Plant and equipment - at cost 133, ,394 Less accumulated depreciation (94,171) (85,109) 39,090 28,285 (a) Movements in carrying amounts 579, ,018 Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year Leasehold Land and Buildings $ Furniture and Fittings $ Plant and equipment $ Total $ Balance at the beginning of year 473,452 11,281 28, ,018 Additions 69,172 9,418 20,307 98,897 Disposals Add back of accumulated depreciation - - (24,316) 24,316 (440) 440 (24,756) 24,756 Depreciation expense (20,303) (2,222) (9,502) (32,027) Carrying amount at the end of the year 522,321 18,477 39, ,888

17 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE $ $ Note 8: Property, Plant and Equipment continued The value of the leasehold land and buildings is shown at cost. The leasehold land and buildings were valued at $1,040,000 on 31 December, 2003 by McCann Property and Planning based on current market value. This revaluation has not been brought to account. Note 9: Other Financial Asset Investment units in a balanced fund at market value 26,707 26,707 Note 10: Payables Trade creditors 10,778 9,392 Grants in advance - 13,609 Rent in advance 4,325 - Membership received in advance 4,295 3,465 Unexpended funds for Outreach Projects 2,189 10,645 PAYG tax payable 7,650 6,666 Accrued expenses Salary benefits payable 1,164 3,162 30,639 47,906 Note 11: Provisions Provision for employee entitlements 32,748 20,256 Number of employees at year end Note 12: Segment reporting The Society operates in the social welfare sector providing information and support to its members within the ACT region.

18 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 13: Key Management Personnel Compensation $ $ The aggregate compensation of key management personnel of the company is set out below: Short term benefits 161, ,311 Post employment benefits - - Total benefits 161, ,311 Note 14: Cash Flow Information (a) Reconciliation of Cash Cash at bank 278, ,486 Cash on deposit 157, ,642 Cash on hand , ,278 (b) Reconciliation of net cash provided by (used in) operating activities to surplus from ordinary activities Surplus from ordinary activities 70,067 7,465 Non-cash flows in surplus from ordinary activities: Depreciation 32,027 33,008 Loss on disposal of plant & equipment - 66 Change in market value of investments - (2,258) Changes in assets and liabilities: (Increase)/Decrease in accrued income 11,707 (9,471) (Increase)/Decrease in sundry debtors (7,600) (25,409) (Increase)/Decrease in loan to MS Australia - 14,457 (Increase)/Decrease in prepaid expenses (1,187) 4,804 (Increase)/Decrease in net GST refundable 6,484 (1,621) (Increase)/Decrease in Merchandise on Hand - (1,106) (Increase)/Decrease in Work in Progress-GMH 3,882 (3,882) Increase/(Decrease) in trade creditors 1,386 6,037 Increase/(Decrease) in accrued expenses (729) (13,303) Increase/(Decrease) in fringe benefits payable (1,998) (233) Increase/(Decrease) in PAYG tax payable 984 1,196 Increase/(Decrease) in provisions 12,492 (11,233) Increase/(Decrease) in unexpended project donation (8,456) (9,053) Increase/(Decrease) in grants in advance (13,609) 922 Increase/(Decrease) in rent received in advance 4,325 (242) Increase/(Decrease) in membership rec d in advance 830 3,465 Increase/(Decrease) in sponsorship in advance - (3,700) Net cash provided (used in) by operating activities 110,605 (10,091)

19 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2007 Note 14: Cash Flow Information continued (c) (d) The Society has no credit stand-by or financing facilities in place. There were no non-cash financing or investing activities during the period. Note 15: Financial Instruments (a) Interest Rate Risk The Society s exposure to interest rate risks, which is the risk that the value of a financial instrument will fluctuate as a result of changes in market interest rates and the effective weighted average interest rates on those financial assets and financial liabilities, is as follows: Weighted Average Effective Interest Rate % % Floating Interest Rate $ $ Financial Assets: Cash at bank , ,636 Cash on deposit , ,642 Total Financial Assets 435, ,278 (b) Credit Risk The maximum exposure to credit risk, excluding the value of any collateral or other security, at balance date to recognised financial assets is the carrying amount, net of any provisions for doubtful debts, as disclosed in the statement of financial position and notes to the financial statements. The Society does not have any material credit risk exposure to any single debtor or group of debtors under financial instruments entered into by the Society. (c) Net Fair Value Methods and assumptions used in determining net fair value. The net fair values of listed investments have been valued at the quoted market bid price at balance date adjusted for transaction costs expected to be incurred. For other assets and other liabilities the net fair value approximates their carrying value. No financial assets and financial liabilities are readily traded on organised markets in standardised form other than listed investments. Financial assets where the carrying amount exceeds net fair values have not been written down as the economic entity intends to hold these assets to maturity. The aggregate net fair values and carrying amounts of financial assets and liabilities are disclosed in the statement of financial position and in the notes to the financial statements.

20 Note 16: Society Details The principal place of business of the Society is: The Multiple Sclerosis Society of the ACT Incorporated Gloria McKerrow House, 117 Denison Street, Deakin, ACT, 2600.

21 STATEMENT BY MEMBERS OF THE COMMITTEE In the opinion of the Committee the financial report, being the Income Statement, Balance Sheet, Statement of Changes in Equity, Statement of Cash Flows and notes to the financial statements: 1. Presents a true and fair view of the financial position of the Multiple Sclerosis Society of the ACT Incorporated as at 30 June 2007 and its performance for the year ended on that date in accordance with Australian Accounting Standards, mandatory professional reporting requirements and other authoritative pronouncements of the Australian Accounting Standards Board; 2. At the date of this statement, there are reasonable grounds to believe that the Multiple Sclerosis Society of the ACT Incorporated will be able to pay its debts as and when they fall due. This statement is made in accordance with a resolution of the Committee and is signed for and on behalf of the Committee by: I Pennell, AM President D Cross Treasurer Dated this 23 rd day of August, 2007

22 AUDITOR S DISCLAIMER The additional financial data presented in the following pages is in accordance with the books and records of Multiple Sclerosis Society of the Act Incorporated which have been subjected to the auditing procedures applied in our audit of the Society for the year ended 30 June It will be appreciated that our statutory audit did not cover all details of the additional financial data. Accordingly, we do not express an opinion on such financial data and no warranty of accuracy or reliability is given. Neither the firm nor any member or employee of the firm undertakes responsibility in any way whatsoever to any person (other than to Multiple Sclerosis Society of the Act Incorporated) in respect of such data, including any errors or omissions therein however caused. Canberra, Australian Capital Territory RSM Bird Cameron Chartered Accountants Dated: 27 th August 2007 Ged Stenhouse Director