Mercy Hospice. Auckland. Te Koro wai Atawhai MERCY HOSPICE AUCKLAND LIMITED ANNUAL REPORT

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1 Mercy Hospice Auckland Te Koro wai Atawhai MERCY HOSPICE AUCKLAND LIMITED ANNUAL REPORT FOR THE YEAR ENDED 31MARCH2015

2 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31MARCH2015 CONTENTS Page 1 Directory Pages 2-3 Auditors' Report Page4 Statement of Financial Performance Page4 Statement of Movements in Equity Page 5 Statement of Financial Position Pages 6-8 Notes to the Financial Statements The Directors are pleased to present the Annual Report, including financial statements, of Mercy Hospice Auckland Limited for the year ended 31 March For and on behalf of the Board:,?.i)I J Director: ~ 7 Date: ;;i, ~ (/ ;zcj/ 1 /

3 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31MARCH2015 DIRECTORY Nature of Business Trading Name & Address Paid in Capital Registered Office Registered Under Shareholder Directors Management Auditors Bankers Specialist Palliative Care Hospice Mercy Hospice Auckland Limited 61 College Hill Ponsonby AUCKLAND Nil 7 New Street Ponsonby AUCKLAND The Companies Act 1993 Mercy Healthcare Auckland Limited Denis Michael Wood (Chairman) Susan Keppel Judith May Vivienne Leydon, rsm Patricia Rowe, rsm Francis Horton Tuck Lynda Smith KPMG 18 Viaduct Harbour Avenue AUCKLAND ASB Bank North Harbour AUCKLAND Bank of New Zealand Queen Street AUCKLAND Page 1

4 Independent auditor s report To the shareholder of Mercy Hospice Auckland Limited We have audited the accompanying financial statements of Mercy Hospice Auckland Limited (''the company'') on pages 4 to 8. The financial statements comprise the statement of financial position as at 31 March 2015, the statements of financial performance and movements in equity for the 12 month period then ended, and a summary of significant accounting policies and other explanatory information. Director's responsibility for the financial statements The director is responsible for the preparation and fair presentation of the financial statements in accordance with generally accepted accounting practice in New Zealand (being New Zealand Equivalents to International Financial Reporting Standards for Public Benefit Entities Differential Reporting) and for such internal control as the director determines is necessary to enable the preparation of financial statements that are free from material misstatement whether due to fraud or error. Auditor s responsibility Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with International Standards on Auditing (New Zealand). Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the company s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates, as well as evaluating the presentation of the financial statements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our unmodified opinion on the financial position and our qualified opinion on financial performance. Other than in our capacity as auditor we have no relationship with, or interests in, the company.

5 Basis for qualified opinion on financial performance The company's recorded revenue includes fundraising income of 4,891,841 (2014: 4,924,349). Control over such revenues prior to being recorded is limited and there were no practical audit procedures that we could perform to confirm independently that all fundraising income was properly recorded. Accordingly, we were not able to determine whether any adjustments might be necessary to the amounts shown in the financial statements for revenue and net profit. The audit opinion for the 12 month period ending 31 March 2014 was also qualified in this respect. Qualified opinion on financial performance In our opinion, except for the possible effects on the corresponding figures of the matter described in the Basis for qualified opinion paragraph, the financial statements on pages 4 to 8 present fairly, in all material respects, the financial performance of the company for the 12 month period ending 31 March 2015, in accordance with generally accepted accounting practice in New Zealand and the New Zealand Equivalents to International Financial Reporting Standards for Public Benefit Entities Differential Reporting. Opinion on financial position In our opinion the financial statements on pages 4 to 8 present fairly, in all material respects, the financial position of the company as at 31 March 2015, in accordance with generally accepted accounting practice in New Zealand and the New Zealand Equivalents to International Financial Reporting Standards for Public Benefit Entities Differential Reporting. 23 July 2015 Auckland

6 STATEMENT OF FINANCIAL PERFORMANCE FOR THE YEAR ENDED 31 MARCH March March 2014 OPERA TING INCOME DHB Contract income - patient services Other contract income Other operating income Interest received Note 3 4,527,480 7, ,662 46,421 4,528,244 15, ,885 56,276 4,696,943 4,701,018 OPERA TING COSTS Salaries and wages Agency Payments Contract Payments Other Staff Costs Patient Care Costs Facility Operating Costs Administration Costs Depreciation OPERATING DEFICIT ,694, , , , , , , , 158 8,023,607 (3,326,664) 5,645, , , , , , , ,567 7,905,079 (3,204,062) FUNDRAISING INCOME Net Income from donations and fundraising Net Income from shop sales 3 1,654,834 1,310,677 2,965,512 1,879,900 1,254,847 3,134,746 Net Operating Surplus/(Deficit) for the year (361, 152 (69,315 STATEMENT OF MOVEMENTS IN EQUITY FOR THE YEAR ENDED 31 MARCH 2014 Net Operating Surplus/(Deficit) for the year (361, 152) (69,315) Total recognised revenue and expenses (361,152) (69,315) Opening Equity 8,162,534 Closing Equity 8 e Page 4

7 STATEMENT OF FINANCIAL POSITION AS AT 31 MARCH 2015 Notes 31 March March 2014 Retained earnings Net Operating surplus I (deficit) for year Equity 4,8-361, 152 8, 162,534-69,315 Total Equity and Long Term Liabilities Represented by: Current Assets Cash Short Term Deposits Accounts receivable Prepayments Non-Current Assets Capital work in progress Buildings Furniture, Plant and Equipment Shop fixtures & fittings Motor Vehicles 5 806, , ,975 25,263 32,963 6,345, ,711 29, ,266 2,085,563 6,900, ,302 1,037, ,293 26,538 97,007 6,455, , ,416 53,300 2,431,091 6,941,970 Total Assets 8,985,835 9,373,061 Current Liabilities Accounts payable and Sundry Creditors Deferred Grants GST liability 7 1,021, ,233 39,683 1,253,769 1,092, ,430 35,297 1,279,843 Total Liabilities 1,253,769 1,279,843 NET ASSETS e Page 5

8 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH The company acquired the net operating assets and business of Mercy Hospice Auckland Limited from Mercy Hospltal Auckland Limited on 1 April Statement of Accounting Policies Basis of Preparation The company, Mercy Hospice Auckland Limited, is registered under the Companies Act The financial statements have been prepared in accordance with the Financial Reporting Act The company is also registered as a charity under the Charities Act The financial statements have been prepared on the basis of historical cost. To ensure consistency with the current period, comparative figures have been restated where appropriate. There have been no changes in accounting policies. All policies have been applied on a consistent basis with those of the previous year. Differential Reporting In terms of the Framework for Differential Reporting, an entity is exempted from certain requirements of Financial Reporting Standards if It satisfies the criteria laid down in the framework; such an entity is called a qualifying entity. Mercy Hospice Auckland Limited is a qualifying enttty for differential reporting because It has no public accountabillty and is not large as defined in the Framework. Accordingly, all relevant differential reporting requirements have been applied except that addltional revenue and expense disclosures have been made. Property, Plant and Equipment Assets are recognised at cost less accumulated depreciation and impairment losses. Depreciation was writ1en off and charged to the Statement of Financial Performance using a straight line method, over the estimated economic lives of the assets. Due consideration was given for a residual value where appropriate. The lives of the assets were generally: Furniture, plant & equipment Motor vehicles Shop Fixtures & Fittings Buildings 4-10 years 5 years 5 years 70 years Accounts Receivable Accounts receivable were valued at estimated realisable value. Inventory Inventories are valued at the lower of cost or net realisable value using specific identification of individual costs. Bequests, Donations and Grants Bequests, donations and grants carrying specific instructions for their use were taken to the Statement of Financial Position and treated as current liabillties if not fully spent during the year. Shop Income Revenue from the sale of goods is recognised in the Statement of Financial Performance when the significant risks and rewards of ownership have been transferred to the buyer. Comparatives Wlere applicable, certain comparatives have been restated to comply with the accounting presentation adopted in the current year. Page6 e

9 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH Total Income Operating income Fundraising income ,696,943 4,891,841 9,588, ,701,018 4,925,287 9,626,305 Facility operating costs Includes: Rent 93,996 88,469 Administration costs Includes: Fees paid to auditors 6,787 6,720 4 Share Capital 1 ordinary share issued for 1 not called Fixed Assets Capita! work in progress ale 1505 Cost Accumulated Depreciation Book value 32, ,963 97, ,007 Buildings ale 1510 ale 1610 Cost Accumulated Depreciation Book value 7,253,684 (908,654) 6,345,030 7,253,684 (798,555) 6,455,129 ale 9920; 9980 Depreciation charge for year 110, ,099 Furniture, plant & equipment ale ale Cost Accumulated depreciation Book value 1,262,691 (879,220) 383,471 1,091,064 (782,946) 308,118 ale Depreciation charge for year 102, ,560 Motor vehicles ale 1570 ale 1670 Cost Accumulated depreciation Book value 466,170 (353,903) 112, ,471 (313,170) 53,300 ale 9960 Depreciation charge for year 40,124 43,613 Shop fixtures and fittings ale ale Cost Accumulated depreciation Book value 124,652 (98,110) 26, ,435 (86,020) 28,416 ale 9970 Depreciation charge for year 11,844 13,204 Total Fixed Assets 6,900,272 6,941,970 Page 7 e

10 NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 MARCH Related Parties Mercy Hospice Auckland Limited is wholly owned by Mercy Healthcare Auckland Limited. Sisters of Mercy Ministries NZ Trust (previously Mercy Ministries Limited) and Mercy Healthcare Auckland Limited provided management, administrative and Mission services to Mercy Hospice Auckland Limited for which a fee is charged. The Mercy Hospice Auckland Foundation is a trust which raises funds to assist in carrying on the work of the Hospice. A grant of 200,000 (2014: 150,000) was received from the Foundation during the year, and this was included in Fundraising Income at year end. The Mercy Hospice Services Limited is governed by Mercy Healthcare Board and holds investment capital on behalf of Mercy Hospice Auckland. Bequest Income of nil (2014: 186,800 was received from Services during the year, and this was received in Accounts Receivable at year end). Donation to support the palliative care partnership with Mercy Parklands of 106,425 (2014: nil); and donation of 69,600 to support the development of the bequest programme (2014: nil). 7 Account Payable and Sundry Creditors Accounts payable a/c 201 O Sundry creditors and accruals ale 2020; 2030; 2060; 2080 Payroll related accruals a/c 2040; 2050; 2070; , , ,876 1,021, , , ,832 1,092,116 8 Equity Equity is comprised of the following: Retained Earnings Closing Equity 9 Taxation Mercy Hospice Auckland Limited is a not-for-profit organisation and is not subject to income tax. The company holds a relevant exemption certificate from the Inland Revenue Department. 10 Capital Commitments Capital expenditure commitments at balance date: nil (2014: nil). 11 Lease Commitments The lease commitments for the rental of the seven shops: Blockhouse Bay, Ellerslie Clothing, Ellerslie Furniture, Mt Eden, Ponsonby, Pt Chevalier, Royal Oak & Onehunga Due within one year Due after one year but within two Years Due after two years but within five Years Due after 5 years , , ,428 o , , ,980 o The company has a monthly leasehold commitment for the property situated in College Hill, Auckland Page 8 8

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