CONTENTS€¦ · Melbourne & Olympic Parks – a world class business delivering world class customer experiences. ... standards of corporate governance practice and ethical conduct

ANNUAL REPORT 2016

D R A F T

Governance 4

The Chairman’s Report 6

The CEO’s Report 7

Highlights 2015−16 9

Our Partners 11

Financial Overview 12

Financial Statements 13

Administrative Reporting Requirements 58

Disclosure Index 61

CONTENTS

3 MELBOURNE & OLYMPIC PARKS TRUST

D R A F T

GOVERNANCE

EstablishmentThe Melbourne and Olympic Parks Trust (MOPT) was established on 5 October 1995 pursuant to the provisions of the Melbourne and Olympic Parks Act 1985 (as amended). It was created by the merger of the National Tennis Centre Trust (established 13 Nov 1985) and the Olympic Park Committee of Management (formed originally in 1909). The Act is jointly administered by both the Premier of Victoria, the Honourable Daniel Andrews, and the Minister for Sport, Tourism and Major Events, the Honourable John Eren.

The Melbourne and Olympic Parks Act 1985

The Purpose of the ActThe purposes of the Act as outlined in Section 3 are:

• To create a Melbourne and Olympic Parks Trust to administer the National Tennis Centre, Olympic Park and certain other land and facilities for the purposes of tennis, other sports, recreation and entertainment.

• To provide for the management and operation of the National Tennis Centre and Olympic Park.

• To provide for the use and promotion of the National Tennis Centre and Olympic Park.

• To provide for the development, promotion, management, operation and use of sports, recreation and entertainment facilities and services in Victoria in addition to those at the National Tennis Centre and Olympic Park.

Under the Act the Trust has the following primary functions:

• To accept appointment and act as a committee of management of Crown lands.

• To be responsible for the care, improvement, use and promotion of the National Tennis Centre and Olympic Park as facilities for tennis, other sports, recreation and entertainment.

• To operate the National Tennis Centre and Olympic Park efficiently and effectively to obtain the best possible use of the facilities.

• To provide planning for the operation of the National Tennis Centre and Olympic Park, which is coordinated between the two facilities.

• To be responsible for proper financial management of the National Tennis Centre and Olympic Park.

• To provide for the planning, development, promotion, management, operation and use of other sports, recreation and entertainment facilities and services in Victoria.

• To provide for the development, promotion, management, operation and use of facilities and services for the parking of vehicles and other necessary services to be used in conjunction with any of the facilities operated or managed by the Trust.

• To provide for the management of Gosch’s Paddock by the Trust as a committee of management under the Crown Lands (Reserves) Act 1978.

Melbourne & Olympic Parks’ Strategic Goals

Vision Melbourne & Olympic Parks – a world class business delivering world class customer experiences.

GoalsIn the context of an expanding precinct and substantial new infrastructure investment, we must:

• Maintain our financial sustainability.

• Increase benefits to the people of Victoria.

To achieve this, we must:

• Grow our business.

• Ensure our core business processes deliver value.

• Build a high performance integrated organisation.

We must always ensure the customer is at the heart of everything we do.


D R A F T

GOVERNANCE

TRUSTEES

Mr Brian Morris – Chief Executive Officer

Mr Russell Fakira – Director of People & Operations

Mr Greg George – Director of Commercial & Strategy

Ms Enna Giampiccolo – Corporate Communications Manager

Mr Travis Mardling – Chief Financial Officer

Mr Shane Mates – General Manager AAMI Park

Mr Geoff McDonald – Director of Infrastructure

EXECUTIVE TEAM

Mr Russell Caplan (Chairman)

Ms Jacinda Dixon (from 5 April 2016)

Mr Will Fowles (from 22 December 2015)

Mr Steve Healy

Ms Sharelle McMahon (to 12 May 2016)

Ms Diana Nicholson

Mr John Ribot-de-Bresac (from 22 December 2015)

Mr Kenneth Roche AO

Mr Raymond Smith

Ms Mikaela Stafrace

Mr David Stobart

Mr Scott Tanner (to 11 December 2015)

Statement of Corporate GovernanceProcedures have been established at the Trust and executive management level, which are designed to safeguard the assets and interests of the Trust and to ensure integrity of reporting. The Trust acknowledges the need for and continued maintenance of the highest standards of corporate governance practice and ethical conduct by all Trustees and employees of the Trust.

Remuneration CommitteeThe Trust has established a Remuneration Committee to govern the Trust’s policy and practice for executive remuneration and to determine the individual remuneration packages for its executive staff. The Committee meets as required and makes recommendations to the Trust on specific issues. The members of the Committee during the year ended 30 June 2016 were:

Finance Audit and Risk CommitteeThe Trust has established a Finance Audit and Risk Committee to advise the Trust in relation to matters falling into the broad areas of:

• Financial reporting, accounting policies and internal controls

• Risk management

• Governance, and

• Funding.

The Committee meets monthly or more often as required and makes recommendations to the Trust on specific issues.

The Members of the Committee during the year ended 30 June 2016 were:

All Finance, Audit and Risk Committee members are independent from management.

Strategic Planning CommitteeThe Trust’s Strategic Planning Committee is established to provide independent and expert advice to assist the Trust to discharge its strategic planning responsibilities.

The Members of the Committee during the year ended 30 June 2016 were:

Mr Raymond Smith (Chair)

Mr Russell Caplan

Ms Diana Nicholson

Mr Kenneth Roche AO

Ms Mikaela Stafrace

Ms Jacinda Dixon

Mr Russell Caplan

Ms Diana Nicholson

Mr Kenneth Roche AO

Mr Raymond SmithMr Russell Caplan

Mr John Ribot-de-Bresac (from 22 December 2015)

Mr Raymond Smith

Ms Mikaela Stafrace

Mr Scott Tanner (to 11 December 2015)


D R A F T

THE CHAIRMAN’S REPORT In accordance with the Financial Management Act 1994, I am pleased to present the Report of Operations for the Melbourne and Olympic Parks Trust (M&OP) for the year ending 30 June 2016.

The Trust again produced a positive financial result for the 2015/2016 financial year, reporting a net profit of $244,000. This is despite a cyclical downturn in the international concert touring market and a significant increase in depreciation arising from the continued investment in M&OP redevelopment. We would like to acknowledge and thank the Premier of Victoria, the Honourable Daniel Andrews, and the Minister for Tourism, Sport and Major Events, the Honourable John Eren, for their ongoing support for this Precinct.

As investment in infrastructure renewal grows, M&OP will inevitably start reporting net losses after depreciation. This will affect the metrics used to define and measure our success as a precinct and as a contributor to the wider Victorian economy. The Trust will continue to pursue operating efficiencies and growth opportunities to ensure M&OP remains financially sustainable and low risk as defined by The Victorian Auditor General Office (VAGO) and to ensure the precinct continues to contribute strongly to the development of sport and entertainment.

During the year more than 2.4 million tickets to events at the various Melbourne & Olympic Parks venues were sold. Pleasingly, despite the decline in high yielding international concerts in 2015/16, there was an overall increase in the number of events staged. The rebuilt Margaret Court Arena offered new opportunities to expose emerging talent while investments in new infrastructure at Hisense Arena supported the continued growth of netball, basketball and cycling.

A successful Australian Open hosted 720,373 tennis fans - another record-breaking attendance. The year also saw the expansion of the event’s footprint, featuring new activations at Birrarung Marr. Congratulations to Craig Tiley and the team at Tennis Australia for consistently improving the fan experience year on year.

Solid progress was made on construction of the new Administration and Media Building and the Tanderrum Bridge that connects Birrarung Marr to Melbourne Park and provides a new entrance to the Precinct. Both projects are on target to be operational for the 2017 Australian Open.

The complex, multi-year redevelopment of Rod Laver Arena also began this year, starting with the relocation of the main entrance to make way for new dedicated backstage and loading areas to accommodate bigger shows and ensure patron safety and comfort. The coming years will see the creation of a new eastern entry, expanded and improved public amenities and seating, as well as new and modernised facilities for Australian Open players. This project will maintain Rod Laver Arena’s premier position among the Grand Slam venues.

The Trust’s objective is to minimise the impact of the four-year construction program on the ongoing delivery of events at Rod Laver Arena and especially to ensure the successful presentation each year of the Australian Open.

This is an unprecedented and challenging time for the precinct and I would like to acknowledge the work of CEO Brian Morris and the Melbourne & Olympic Parks team. They have shown their commitment to delivering outstanding experiences for fans, hirers and stakeholders while managing the complexities of a full event calendar and the extensive construction activities across the precinct

Finally, thanks to my fellow Trustees for their contribution and support and, in particular, thanks to Sharelle McMahon, Mikaela Stafrace and Scott Tanner who completed their terms as Trustees in the last year.

Russell Caplan


D R A F T

THE CEO’S REPORTOverall Performance

Melbourne & Olympic Parks reported a positive net profit after depreciation of $244,000 while earnings before interest, tax, depreciation and amortisation was $30.804 million, only slightly down on the year prior. This is despite difficult trading conditions affecting one of our most important profit contributors, the international touring concert market. The resultant decline in high yielding international concert tours in Rod Laver Arena placed pressure on our margins, however costs were effectively managed and profitability was maintained. Overall the number of other events held, and in particular sporting events, still increased with 539 event days contracted across the precinct.

Australian Open

All of the Melbourne Park venues were utilised for the period of the Australian Open and a record 720,373 patrons attended the 2016 Australian Open main draw. The event continues to grow with the December Showdown, qualifying and other pre-main draw events such as Kids Tennis Day Presented by Nickelodeon, extending the Australian Open period. As a result of the devastating terrorist attacks in other parts of the world, security was a particular focus for this year’s event. Changes to the security environment were managed without significant impact on the patron experience.

A number of new hospitality and catering concepts were also introduced with Laneway, Cucina di Casa and 88 Melbourne. Estelle, a signature restaurant by Scott Pickett, and Grass and Grain again performed well, while Grand Slam Oval with its multiple activation spaces and entertainment zones remained popular. The booking systems introduced by Tennis Australia to manage waiting times on peak days enabled patrons to explore the site and watch tennis rather than waiting in a queue.

The event successfully trialled an expansion of its entertainment and activation zones into Birrarung Marr, providing a stronger link to the city. This was in preparation for the creation of a new entrance and activity area in Birrarung Marr when Tanderrum Bridge, the new footbridge over Batman Avenue, is completed for the 2017 Open.

Rod Laver Arena

In addition to the Australian Open, Rod Laver Arena attracted 548,536 patrons and was contracted for 87 days. This attendance was significantly down on previous years due to the negative impact of the exchange rate on touring event costs and subsequent effect on ticket prices.

Regardless, the year still saw an impressive array of entertainment performances including, Hugh Jackman’s spectacular Broadway to Oz, An Evening with Oprah Winfrey and musical legends, Madonna, Elton John, Fleetwood Mac and Neil Diamond to name a few. Other events such as WWE, the Wiggles, Ice Hockey and the International FIBA Basketball Championships were also popular.

Immediately after the 2016 Australian Open, construction commenced on Rod Laver Arena, with the temporary relocation of the main entry to the east to enable works to begin. The construction phase will create a new logistics and loading area servicing both Rod Laver Arena and Margaret Court Arena, and will significantly improve safety by separating patrons from truck traffic and event logistic activities.

The arena itself is now almost 30 years old and the current works are the start of a substantial upgrade to the venue’s facilities. The four-year redevelopment will present some challenges as we balance the operational requirements of events with the need to enhance and transform the venue to meet the future needs of our hirers and patrons. The objective is to enable Rod Laver Arena to remain operational throughout the project and ensure there is no impact on the Australian Open - a challenging task.

Hisense Arena

In addition to the Australian Open period, Hisense Arena attracted 288,000 patrons and was contracted for 100 days. The focus of this arena is on creating an environment structured around the sports fan and families. Resident sports include netball, basketball, track cycling, dance sports and gymnastics, all of which have longer term preferential booking arrangements in place. The multi-purpose format of the arena and its focus on the experience of the sports fan makes it the most versatile on the precinct.

Over the past 12 months, in order to support the development of the resident sports, M&OP has implemented new flexible lighting schemes; fan friendly sound systems; and increased the use of LED technology with the implementation of a new centre-hung video cube. These, along with flexible seating arrangements, enable the arena to be cost-effectively customised to meet the needs of its resident sports and to cater for a wide range of family and youth events.

The year also saw the continuation of popular family, community and youth events such as Disney on Ice, Planetshakers and the State Schools Spectacular, while a new underage event, the Goodlife Music Festival opened up new opportunities to provide safe facilities for under-18’s.

Margaret Court Arena

Margaret Court Arena was open for its first full year, and in addition to the Australian Open period attracted 103,750 patrons. The arena is quickly establishing itself as an important new player in the mid-range music and entertainment space and is making significant contributions to M&OP’s long term sustainability, this year recording 44 contracted days. The arena is enabling M&OP to continue to support the development of sport and other community based activities across the precinct.

Some up-and-coming entertainment acts were Vance Joy, Rudimental, Modest Mouse and A$AP Rocky. The venue is


D R A F T

THE CEO’S REPORTalso becoming a popular option for high-end hospitality events such unique gala dinners and other corporate focused events.

AAMI Park

A total of 79 contracted days drew 839,117 patrons to AAMI Park. Melbourne City, Melbourne Victory, Melbourne Storm and the Melbourne Rebels continued to draw good crowds throughout the course of the year. Towards the end of the year the Melbourne Rebels relocated their training and administration functions to new purpose built facilities at AAMI Park and joined the Melbourne Storm, Melbourne Victory and Melbourne Football Club as tenants of the stadium.

This year was unique with a particularly strong stadium concert touring period with five capacity concerts between Ed Sheeran and Taylor Swift, as well as the family favourite, Monster Jam, which again saw the transformation of AAMI Park to an obstacle course and race track for the giant trucks to navigate.

AAMI Park’s pitch experienced some difficulty this year coping with the demands of rugby union scrums, which required considerable investment in short term work. The pitch issues were confined to the impact of the scrumming techniques of rugby union and no other events or codes were impacted. The quality of the pitch is a significant source of pride, and an in-depth review is underway to ensure that the pitch can be maintained at peak condition while dealing with the differing requirements of the various sporting codes and that a balance can be reached between maintenance work and game scheduling during the season overlaps.

Melbourne Park Function Centre

A new focus on the Melbourne Park Function Centre enabled a significant growth in utilisation and income. The venue has become a popular choice for corporate events and hospitality and is growing as an important income stream for M&OP.

Community Activities and Support for Sport

M&OP continues to facilitate sport development programs through its resident clubs, tenants and the government, supporting them in the delivery of their programs. Extensive support is also provided in the form of funding for sports development and the delivery of programs in the precinct’s venues.

As well as facilitating casual and recreational use of our precinct, Melbourne & Olympic Parks each year also supports a range of community activities and events using its staff, venues and specialised skills to support participation in sport, causes or fundraising.

The precinct continued its involvement in the Open House Melbourne initiative, this year conducting tours for the public of Margaret Court Arena. Participants were taken

on an exclusive back of house tour of the arena and the usually off-limits backstage areas.

A large-scale community event to raise funds for brain cancer was held at Margaret Court Arena. The event was the initiative of television personality, Carrie Bickmore and attracted hundreds of people to an exclusive concert by Ed Sheeran, Rudimental and Vance Joy to name a few.

Other community events included an open day to support the Victorian Council of Ambulance Authorities, a fundraising event for the Upstream Foundation and participation in the Premier’s Active April initiative.

Capital projects & infrastructure

M&OP currently has assets under management of $1.3 billion, requiring an intensive maintenance and improvement regime. More than $20.1 million was invested directly by the Trust in capital works to improve and upgrade facilities and infrastructure during the year. This was in addition to the $40 million that was contributed over the past two years to the Melbourne Park redevelopment.

During the year the further development of the Holden Centre was completed the Collingwood Football Club was able to open its new $25 million community facilities.

Gosch’s Paddock

Gosch’s Paddock continues to be used for training by Melbourne Football Club, Melbourne Victory and Melbourne Storm, as well as a variety of other organisations. Its fields and surrounds are open for public use when not used for formal training. Annual renovations were carried out on all the pitches to ensure that they are maintained to a high standard and public usage of this area continues to grow requiring regular investments in pitch refurbishment. Except for the small areas under maintenance, Gosch’s Paddock was not closed to the public during the year.

Health and Safety

M&OP maintains its strong commitment to health and safety – of employees, guests and contractors. This year brought some good results including improvements in some key measures and a reduction in guest injuries.

Finally, my deep appreciation to the Chairman of the Trust Russell Caplan and all of the Trustees as well as Tim Bamford and Pier De Carlo and their respective teams at Major Projects Victoria and Sport and Recreation Victoria. A special thanks to the Melbourne & Olympic Parks team who continue their passion and commitment to delivering the best events for the people of Victoria.

Brian Morris


D R A F T

HIGHLIGHTS 2015−2016Events

Rod Laver Arena• Blur• WWE• International Basketball

FIBA Oceania Championships

• Maroon 5 • The Footy Show Grand

Final Edition 2015• KISS• Russell Brand • BigBang • Robbie Williams • Neil Diamond • Fleetwood Mac• Def Leppard• Cold Chisel • Jason Derulo • Broadway to Oz• An Evening with Opera

Winfrey• The Wiggles Live • Sam Smith • Elton John • Amity Affliction and a Day

to Remember • Kevin Hart • Rob Thomas• Madonna • Bryan Adams • Kendrick Lamar• Black Sabbath • Hilltop Hoods

• Iron Maiden • Nitro Circus • Culture Club • 2016 Ice Hockey Classic

Hisense Arena• Disney on Ice • Danny Green v Roberto

Bolonti• Melbourne United (13

home games)• ANZ Summit • Victorian State School

Spectacular 2015• Subculture 2015• Ambulance Victoria

Community Event • Netball Test Series • David Guetta • Wang Feng• 70th Australian

DanceSports Championships 2015

• Austral Wheel Race • Goodlife Music Festival • Atlantis 2016• Planetshakers Awakening

2016• Ice Age Live • The Vixens (5 home

games)• Godskitchen • Australian Gymnastics

Championships

AAMI Park• Melbourne City

Hyundai A-League (14 home matches and 1 final)

• Melbourne Rebels Super Rugby (6 home matches and 1 trial match)

• Melbourne Storm National Rugby League (11 home matches and 1 final)

• Melbourne Victory Hyundai A-League (8 home matches) Asian Champions League (4 home matches)

• Monster Jam (2 shows)

• Ed Sheeran (2 shows)

• Taylor Swift (3 shows)

• ARU Wallabies Test Match Australia v England

• Westfield FFA Cup (3 home matches - Melbourne City, Melbourne Victory and Hume City) (Grand Final - Melbourne Victory v Perth Glory)

• Westfield W-League Grand Final Melbourne City v Sydney FC

Margaret Court Arena• Yellowcard • The Wombats• Mark Ronson• Imagine Dragons • Celtic Thunder • Wiz Khalifa• International Wildcard All

Stars• Rise Against• Carrie Bickmore’s Beanies

for Brain Cancer• A$AP Rocky• Wu Tang Clan • Sounds of Light • Jason Aldean• Modest Mouse• Noel Gallagher • Chris Isaak• Sammi Cheng• Vance Joy • Jim Jefferies • Carl Barron • Rudimental• Celtic Thunder • Little Mix• The Vixens • The Rubens

Key Statistics

2015/16 2014/15 Number of contracted days - Melbourne Park 314 237 Number of contracted days - AAMI Park 79 84 Number of contracted days - Melbourne Park Function Centre 146 123 Total ticketed patronage 2,499,790 2,414,750Rod Laver Arena event ticketed attendance 548,536 597,045 Hisense Arena event ticketed attendance 288,014 259,325 AAMI Park event ticketed attendance 839,117 751,779Margaret Court Arena ticketed attendance 103,750 101,075Melbourne Park Function Centre patrons 42,005 67,994 Attendance at Australian Open 720,373 703,889Number of website visitors (all MOPT sites) 1,416,678 1,139,786


D R A F T

HIGHLIGHTS 2015−2016Major Capital Expenditure

Expenditure Type Amount Details

Melbourne Park $2.5 million Includes upgrades to tennis facilities, including show court waterproofing, lighting and amenity upgrades.

Rod Laver Arena $2.7 million Includes works on the operable roof, the replacement of the arena floor, sports lights, transverse aisle carpet and stairs leading to the arena floor and an upgrade to the venue control centre.

Hisense Arena $4.5 million Includes replacement of the chiller units and concourse carpet and upgrades to emergency lighting.

Margaret Court Arena $0.1 million Purchase of fixtures, fittings and equipment and loading dock works.

Olympic Park Precinct $6.2 million Includes construction of Melbourne Rebels offices and the relocation of M&OP management offices, installation of level 3 LED parapet signage, Gosch’s Paddock playing field modifications, upgrades to pylon sign LED’s and corporate suite catering areas and Holden Centre façade works.

Equipment and Technology $4.1 million Includes a radio frequency survey and upgrades to core & access switches, voice over internet protocol (VOIP), internet protocol television (IPTV) and food and beverage point of sale units.

TOTAL $20.1 million

Note: The ongoing Melbourne Park redevelopment continues to be managed and undertaken by Major Projects Victoria.


D R A F T

OUR PARTNERS The Trust would like to thank the following organisations for their support over the past year.

TenantsCalibre Feasts

Collingwood Football Club

Imaging @ Olympic Park

Melbourne Football Club

Melbourne Rebels

Melbourne Storm

Melbourne Victory

Olympic Park Sports Medicine Centre

Tennis Australia

Tennis Victoria

Victorian Olympic Council

SuppliersCoca-Cola Amatil

Diageo Australia

Carlton & United Breweries

Heineken Lion Australia

Pernod Ricard Australia

Treasury Wine Estates

Venue PartnersAAMI

TechGuard Security

Capricorn Stages and Rigging

Delaware North Companies Australia

Hisense Australia

O’Brien Catering Group Australia

Microhire

Ticketek

Regular Arena HirersChugg Entertainment

Dainty Group

Feld Entertainment

Frontier Touring Company

Live Nation Australasia

Melbourne United

Melbourne Vixens

TEG Live

AAMI Park ClubsMelbourne City

Melbourne Rebels

Melbourne Storm

Melbourne Victory


D R A F T

FINANCIAL OVERVIEW The financial statements in this report relate to the activities of Melbourne & Olympic Parks Trust for the year ended 30 June 2016.

The net result for 2016 was a profit of $0.244 million (2015: $0.745 million).

In the 2015/16 year the Trust received grants from the Victorian Government totalling $47.0 million all of which was treated as contributed capital (2015: $28.390 million). The grants in 2016 were further contributions towards the redevelopment of the Melbourne Park precinct (2015: grants towards the redevelopment of the Melbourne Park precinct).

Total income for 2015/16 was $97.143 million, (2015: $91.390 million). Income related to the sales of goods and services increased by 7.7% which was primarily due to holding five concerts at AAMI Park (three Taylor Swift and two Ed Sheeran shows). This has been partially offset by Rod Laver Arena hosting six fewer shows than the prior year (2015/16: 47 vs 2014/15: 53) which was primarily due to a lower number of international concerts touring Australia in the latter half of the year.

The significant factors in reaching M&OP’s income for 2015/16 were:

• Australian Open & Tennis was $1.853 million better than the prior year due to record crowds and the resultant increase in venue rental receipts and catering income;

• Rod Laver Arena hosted 47 shows which was down six shows on the previous year due to some shows being cancelled and some anticipated tours not eventuating. This resulted in a decrease to income of $2.316 million year on year;

• Function Centre utilisation increased from 45% in 2015 to 53% in 2016, with income growing by $1.556 million;

• Hisense Arena hosted 68 shows, which was higher than the prior year by two shows. In addition to Hisense Arena being the home of Melbourne United (Basketball) and Melbourne Vixens (Netball), Hisense Arena also hosted notable events including a Melbourne United Semi-Final, electronic dance parties (Godskitchen, Subculture and Atlantis), Danny Green Boxing and Disney on Ice, which contributed to income being $2.021 million above the prior year;

• Margaret Court Arena was open for the full year hosting 31 shows compared to 16 shows in the prior year when the venue was only open for part of the year (from November 2014) and generated an additional $2.055 million in income;

• AAMI Park hosted 61 event days, compared to 58 in the prior year. In addition to AAMI Park being the home of the Melbourne Storm (rugby league), Melbourne Rebels (rugby union), Melbourne Victory and Melbourne City (football), AAMI Park also hosted notable events including the International Rugby Test Match, Melbourne Storm Semi-Final, W-League Grand Final, FFA Cup Final and three Asian Champions League games. The venue was also host to Monster Jam (two shows), Taylor Swift (three shows) and Ed Sheeran (two shows), all of which contributed to an increase in income of $7.574 million above the prior year;

• The Trust again made a $3.0 million financial transfer to government (2015:$3.0 million), which is used to support the Victorian Government’s sport and recreation programs and facilities.

Total expenditure in 2016 was $97.079 million, (2015: $90.713 million). This increase in expenditure is attributable to the increase in income, as well as the increase from depreciation (an increase of $1.995 million from 2015), most of which is related to the Margaret Court Arena being depreciated for a full year.

Property, Plant & Equipment (less accumulated depreciation) increased by $148.237 million compared to last year, primarily due to the revaluation of land ($90.636 million) and Melbourne Park redevelopment construction costs ($47.0 million).


D R A F T

MELBOURNE & OLYMPIC PARKS TRUSTFINANCIAL STATEMENTS

Comprehensive Operating Statement

Balance Sheet

Statement of Changes in Equity

Cash Flow Statement

Financial Year Ended 30 June 2016


D R A F T

NOTES 2016 $’000

2015 $’000

CONTINUING OPERATIONS

INCOME FROM TRANSACTIONSSales of goods and services (2a) 94,608 87,874 Interest (2b) 887 1,456 Other Income (2c) 1,648 2,061 TOTAL INCOME FROM TRANSACTIONS 97,143 91,391

EXPENSES FROM TRANSACTIONSCost of goods sold/distributed (3a) 15,655 14,444 Purchase of services (3b) 22,008 19,684 Employee expenses (3c) 18,237 17,357 Depreciation & amortisation (7) 31,446 29,451 Other operating expenses (3d) 6,733 6,777 Government Financial Transfer (3e) 3,000 3,000 TOTAL EXPENSES FROM TRANSACTIONS 97,079 90,713

NET RESULT FROM TRANSACTIONS (NET OPERATING BALANCE) 64 678

Other economic flows included in net resultNet gain/(loss) on non-financial assets (4a) 87 - Net gain/(loss) arising from revaluation of long service liability (4b) 93 67

Total other economic flows included in net result 180 67

Net result 244 745

OTHER ECONOMIC FLOWS - OTHER COMPREHENSIVE INCOME

Items that will not be reclassified to the net result

Change in Asset Revaluation Reserve (7) 90,636 -

Total other economic flows - other comprehensive income 90,636 -

Comprehensive result 90,880 745

The above comprehensive operating statement should be read in conjunction with the accompanying notes to the financial statements.

COMPREHENSIVE OPERATING STATEMENTFOR THE FINANCIAL YEAR ENDED 30 JUNE 2016


D R A F T

BALANCE SHEETFOR THE FINANCIAL YEAR ENDED 30 JUNE 2016

NOTES 2016 $’000

2015 $’000

ASSETS

FINANCIAL ASSETSCash and cash equivalents (5) 47,062 58,110 Cash held on behalf of customers (1d) 20,646 46,590 Receivables (6) 5,016 4,748 TOTAL FINANCIAL ASSETS 72,724 109,448

NON-FINANCIAL ASSETSProperty, plant and equipment and intangible assets (7) 1,475,066 1,326,829 Other non-financial assets (8) 378 255 TOTAL NON-FINANCIAL ASSETS 1,475,444 1,327,084

TOTAL ASSETS 1,548,168 1,436,532

LIABILITIESPayables (9) 20,528 17,068 Provisions (10) 3,076 3,070 Other liabilities (11) 28,485 58,195 TOTAL LIABILITIES 52,089 78,333

NET ASSETS 1,496,079 1,358,199

EQUITYAccumulated surplus/(deficit) 203,784 203,540 Reserves 405,311 314,675 Contributed capital 886,984 839,984 NET WORTH 1,496,079 1,358,199

Commitments for expenditure (13)

Contingent assets and contingent liabilities (14/15)

The above balance sheet should be read in conjunction with the accompanying notes to the financial statements.


D R A F T

STATEMENT OF CHANGES IN EQUITYFOR THE FINANCIAL YEAR ENDED 30 JUNE 2016

NOTE Physical AssetRevaluation

Surplus$’000

AccumulatedSurplus

$’000

Contributions by Owner

$’000

Total$’000

Balance at 30 June 2014 314,675 202,795 811,594 1,329,064

Net Result for the Year 745 745

Transactions with owners in their capac-ity as owners

28,390 28,390

Balance at 30 June 2015 314,675 203,540 839,984 1,358,199

Net Result for the Year 244 244

Transactions with owners in their capac-ity as owners

47,000 47,000

Revaluation of Assets (7) 90,636 90,636

Balance at 30 June 2016 405,311 203,784 886,984 1,496,079

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


D R A F T

CASH FLOW STATEMENTFOR THE FINANCIAL YEAR ENDED 30 JUNE 2016

NOTES 2016 $’000

2015 $’000

CASH FLOWS FROM OPERATING ACTIVITIES

RECEIPTSReceipts from customers 90,449 85,693 Interest received 887 1,456 Goods and Services Tax received from the ATO 6,565 5,939 Other Receipts 1,648 2,061 TOTAL RECEIPTS FROM OPERATING ACTIVITIES 99,549 95,149

PAYMENTSPayments to suppliers and employees (59,653) (49,210) Goods and Services Tax paid to the ATO (10,162) (9,530) Payments to Government (financial transfer) (3,000) (3,000) TOTAL PAYMENTS FROM OPERATING ACTIVITIES (72,815) (61,740)

NET CASH FLOWS FROM/(USED IN) OPERATING ACTIVITIES (17b) 26,734 33,409

CASH FLOWS FROM INVESTING ACTIVITIESPayments for non-financial assets (84,869) (63,866) Receipts on sale of non-financial assets 87 -

NET CASH FLOWS FROM/(USED IN) INVESTING ACTIVITIES (84,782) (63,866)

CASH FLOWS FROM FINANCING ACTIVITIESReceipts from Government (capital) 47,000 28,390

NET CASH FLOWS FROM/(USED IN) FINANCING ACTIVITIES 47,000 28,390

Net increase/(decrease) in cash and cash equivalents (11,048) (2,067)

Cash and cash equivalents at the beginning of the financial year 58,110 60,177

CASH AND CASH EQUIVALENTS AT THE END OF THE FINANCIAL YEAR (17a) 47,062 58,110

The above cash flow statement should be read in conjunction with the accompanying notes to the financial statements.


D R A F T

NOTES TO FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 30 JUNE 2016

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Statement of ComplianceThese general-purpose financial statements have been prepared in accordance with the Financial Management Act 1994 (FMA), applicable Australian Accounting Standards (AAS), which includes the Australian accounting standards issued by the Australian Accounting Standards Board (AASB). In particular, they are presented in a manner consistent with the requirements of AASB 1049 Whole of Government and General Government Sector Financial Reporting.

Accounting policies are selected and applied in a manner which ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is reported.

To gain a better understanding of the terminology used in this report, a glossary of terms and style conventions can be found in Note 23.

These annual financial statements were authorised for issue by the Trustees on 31st of August 2016.

(b) Basis of accounting preparation and measurementThe accrual basis of accounting has been applied in the preparation of these financial statements whereby assets, liabilities, equity, income and expenses are recognised in the reporting period to which they relate, regardless of when cash is received or paid.

Judgements, estimates and assumptions are required to be made about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on professional judgements derived from historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised 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. Judgements and assumptions made by management in the application of AASs that have significant effects on the financial statements and estimates relate to:

• the fair value of land, buildings, infrastructure, plant and equipment, (refer to Note 1(k)); and

• assumptions for employee benefit provisions based on likely tenure of existing staff, patterns of leave claims, future salary movements and future discount rates (refer to Note 1(l)).

Consistent with AASB 13 Fair Value Management, Melbourne and Olympic Parks Trust (the Trust) determines the policies and procedures for recurring fair value measurements for property, plant and equipment, in accordance with the requirements of AASB 13 and the relevant Financial Reporting Directions.

All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the

fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

• Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities;

• Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and

• Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable.

For the purpose of fair value disclosures, the Trust has determined classes of assets and liabilities based on the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy as explained above.

In addition, the Trust determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period.

The Valuer-General Victoria (VGV) is the Trust’s independent valuation agency. VGV has utilised the services of Napier & Blakeley, a third party valuer to determine fair value of the Trust’s assets. The Trust’s assets were last independently revalued at 30 June 2012 as required by the Financial Management Act 1994 and was conducted by Napier & Blakeley on behalf of the Valuer-General Victoria who have provided replacement cost and depreciated replacement cost on the inspected properties (Rod Laver Arena and surrounding grounds, Hisense Arena, AAMI Park and Westpac Centre). Works in Progress relating to the redevelopment have not been included in the revaluation.

The Trust, in conjunction with VGV (and Napier & Blakely), monitors changes in the fair value of each asset and liability through relevant data sources to determine whether revaluation is required.

These financial statements are presented in Australian dollars, the functional and presentation currency of the Trust.

The accounting policies set out below have been applied in preparing the financial statements for the year ended 30 June 2016 and the comparative information presented for the year ended 30 June 2015.

(c) Reporting entityThe financial statements cover the Trust as an individual reporting entity. The Trust is a government agency of the State of Victoria, established pursuant to the provisions of the Melbourne and Olympic Parks Act 1985.

Its principal address is:

Melbourne and Olympic Parks TrustBatman AvenueMelbourne VIC 3001


D R A F T


Objectives and fundingThe Melbourne and Olympic Parks Act 1985 outlines that the purpose of the Melbourne and Olympic Parks Trust (M&OP) is to administer, manage and promote the use of Melbourne and Olympic Parks for the purposes of tennis, other sports, entertainment and recreation.

M&OP in its planning delivers on this purpose by ensuring that the precinct is:

• Accessible, well utilised and valued by Victorians

• Recognised as being of international standing for tennis, sport and entertainment

• Supports Victoria’s broader sport, tourism and major events strategies; and

• Financially sustainable.

(d) Scope and presentations of financial statementsComprehensive operating statementThe comprehensive operating statement comprises three components, being ‘net result from transactions’ (or termed as ‘net operating balance’), ‘other economic flows included in net result’, as well as ‘other economic flows – other comprehensive income’. The sum of the former two, represents the net result.

The net result is equivalent to profit or loss derived in accordance with AASs.

‘Other economic flows’ are changes arising from market remeasurements. They include:

• gains and losses from disposals of non-financial assets;

• revaluations and impairments of non-financial physical and intangible assets;

• revaluation of long service leave liability

This classification is consistent with the whole of government reporting format and is allowed under AASB 101 Presentation of Financial Statements.

Refer to Note 23 Glossary for the definitions of ‘net result from transactions, ‘other economic flows included in net result’ and ‘other economic flows – other comprehensive income’.

Balance sheetAssets and liabilities are presented in liquidity order with assets aggregated into, financial assets and non-financial assets. Current and non-current assets or liabilities (those expected to be recovered or settled beyond 12 months) are disclosed in the notes, where relevant.

Cash held on behalf of customers represents cash received for event ticket sales which is held at bank from the time tickets are purchased and paid out to the hirer after the event has taken place. A corresponding liability to customers is also held and included within other liabilities.

Cash flow statementCash flows are classified according to whether or not they arise from operating activities, investing activities, or financing activities. This classification is consistent with requirements under AASB 107 Statement of cash flows.

For cash flow statement presentation purposes, cash and cash equivalents.

Statement of changes in equityThe statement of changes in equity presents reconciliations of non-owner and owner changes in equity from opening balance at the beginning of the reporting period to the closing balance at the end of the reporting period. It also shows separately changes due to amounts recognised in the ‘Comprehensive result’ and amounts recognised in ‘Other economic flows – other movements in equity’ related to ‘Transactions with owner in its capacity as owner’.

(e) Events after reporting dateAssets, liabilities, income or expenses arise from past transactions or other past events. Where the transactions result from an agreement between the Trust and other parties, the transactions are only recognised when the agreement is irrevocable at or before the end of the reporting period.

Adjustments are made to amounts recognised in the financial statements for events which occur after the reporting period and before the date the financial statements are authorised for issue, where those events provide information about conditions which existed in the reporting period. Note disclosure is made about events between the end of the reporting period and the date the financial statements are authorised for issue where the events relate to conditions which arose after the end of the reporting period and which may have a material impact on the results of subsequent reporting periods.

(f) Goods and Services Tax (GST)Income, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case it is recognised as part of the cost of acquisition of the asset or as part of the expense.

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

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flows.

(g) Income from transactionsIncome is measured at the fair value of the consideration received or receivable. Amounts disclosed as income are net of returns, trade allowances and duties and taxes.


D R A F T


Sale of goods and servicesSale of goods and services is recognised upon delivery of the goods and services to the customer and when the Trust gains control of the underlying assets. This includes royalty income from catering and merchandising sales and rental income from tenants in the buildings on the precinct which is recognised for the period in which it relates.

InterestInterest income is recognised on a time proportionate basis that takes into account the effective yield on the financial asset.

GrantsGrants from third parties are recognised as income in the reporting period in which the Trust gains control over the contribution.

Other incomeSinking fund income is recognised as income in the reporting period in which the Trust gains control over the underlying assets.

(h) Expenses from transactionsPayments to third parties are recognised as an expense in the reporting period in which they are paid or are payable.

Cost of goods sold/distributedPurchase costs of goods sold/distributed are recognised as an expense in the reporting period in which they are incurred.

Purchase of servicesPurchase of services are recognised as an expense in the reporting period in which they are incurred.

Employee expensesThese expenses include all forms of considerations (other than superannuation which is accounted for separately) given by MOPT in exchange for service rendered by employees or for the termination of employment. This includes wages and salaries, fringe benefits tax, leave entitlements, redundancy payments and WorkCover premiums.

SuperannuationThe amount recognised in the comprehensive operating statement is the employer contributions for members of defined contribution superannuation plans that are paid or payable during the reporting period.

Details of the funds which the Trust made superannuation contributions to during the year are disclosed in Note 21.

Depreciation and amortisationIn compliance with Australian Accounting Standard AASB116 Property, Plant and Equipment, depreciation and amortisation has been charged on all fixed assets and capital works developments, with the exception of Land. The provisions for depreciation are made using the straight-line method, at rates appropriate to the estimated useful life to the Trust of each individual asset. Estimates of the remaining useful lives for all assets are reviewed annually and range from greater than zero up to one hundred and ten years. The Trust’s policy is to capitalise assets valued over $5,000, whilst assets of less than $5,000 in value are expensed immediately.

The following are typical estimated useful lives for different asset classes for both current and prior years:

Asset Class Useful Life

Buildings 50 - 110 years

Property Plant & Equipment 5 - 60 years

Motor Vehicles 5 years

Intangible Assets 5 years

The residual value and useful life of the assets are reviewed annually.

Other operating expensesOther operating expenses generally represent the day-to-day running costs incurred in normal operations and are recognised as an expense in the reporting period in which they are incurred.

Government financial transfersGovernment financial transfers represents payment made by the Trust to the Government for support of sport and recreation programs.

(i) Other economic flows included in the net resultNet gain/(loss) on non-financial assetsNet gain/(loss) on non-financial assets and liabilities includes realised and unrealised gains and losses as follows:

(i) Net gain/(loss) on disposal of non-financial assets Any gain or loss on disposal of non-current assets is

recognised at the date control of the asset is passed to the buyer and is determined after deducting from the proceeds the carrying value of the asset at that time.

(ii) Impairment of non-financial assets All of the Trust’s assets are assessed annually for

indications of impairment.

If there is an indication of impairment, the assets concerned are tested as to whether their carrying value exceeds their possible recoverable amount. Where an asset’s carrying value exceeds its recoverable amount, the difference is written off by a charge to the comprehensive operating statement except to the extent that the write-down can be debited to an asset revaluation reserve amount applicable to that class of asset.

It is deemed that, in the event of the loss of an asset, the future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made. The recoverable amount of most major assets is measured at the higher of the depreciated replacement cost and fair value less costs to sell. The depreciated replacement cost is the current replacement cost of an asset less, where applicable, accumulated depreciation calculated on the basis of such cost to reflect the already consumed or expired future economic benefits of the asset.


D R A F T


Net gain/(loss) arising from revaluation of long service leave liability Net gain/(loss) from the revaluation of long service

leave liability arises due to changes in the bond interest rates;

(j) Financial instrumentsFinancial instruments arise out of contractual agreements that give rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Due to the nature of the Trust’s activities, certain financial assets and financial liabilities arise under statute rather than a contract. Such financial assets and financial liabilities do not meet the definition of financial instruments in AASB 132 Financial Instruments: Presentation. For example, statutory receivables arising from taxes, fines and penalties do not meet the definition of financial instruments as they do not arise under contract.

Where relevant, for note disclosure purposes, a distinction is made between those financial assets and financial liabilities that meet the definition of financial instruments in accordance with AASB 132 and those that do not.

The following refers to financial instruments unless otherwise stated.

Categories of non-derivative financial instruments

Loans and receivablesLoans and receivables are financial instrument assets with fixed and determinable payments that are not quoted on an active market. These assets are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial measurement, loans and receivables are measured at amortised cost using effective interest method, less any impairment.

Loans and receivables category includes cash and cash equivalents (refer to Note 1 (k)), term deposits with maturity greater than three months, trade receivables, loans and other receivables, but not statutory receivables.

Financial liabilities amortised at costFinancial instrument liabilities are initially recognised on the date they are originated. They are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, these financial instruments are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in profit and loss over the period of the interest-bearing liability, using the effective interest rate method.

Financial instrument liabilities measured at amortised cost include all of the Trusts contractual payables, deposits held and advances received, and interest-bearing arrangements other than those designated at fair value through profit or loss.

(k) AssetsAll assets controlled by the Trust are reported in the balance sheet.

Cash and cash equivalentsCash and cash equivalents, comprise cash on hand and cash at bank, deposits at call and those highly liquid investments with an original maturity of three months or less, which are held for the purpose of meeting short term cash commitments rather than for investment purposes, and which are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value.

ReceivablesReceivables consist of:• statutory receivables, which include predominantly amounts

owing from the Victorian Government and GST input tax credits recoverable; and

• contractual receivables, which include mainly debtors in relation to goods and services and accrued investment income.

Receivables that are contractual are classified as financial instruments. Statutory receivables are not classified as financial instruments.

A provision for doubtful receivables is made when there is objective evidence that the debts will not be collected. Bad debts are written off when identified.

Property, Plant and EquipmentLand, buildings and plant and equipment are recognised initially at cost and subsequently measured at fair value less accumulated depreciation and impairment.

Revaluations of non-current physical assetsNon-current physical assets measured at fair value are revalued in accordance with the new FRD 103F issued by the Minister for Finance. A full revaluation occurs at least every five years, based on the asset’s government purpose classification, but may occur more frequently if fair value assessments indicate material changes in values. Independent valuers are used to conduct these scheduled revaluations and any interim revaluations are determined in accordance with the requirements of the FRDs.

Net revaluation increases (where the carrying amount of a class of assets is increased as a result of a revaluation) are recognised in ‘other economic flows – other comprehensive income’, and accumulated in equity under the asset revaluation surplus. However, the net revaluation increase is recognised in the net result to the extent that it reverses a net revaluation decrease in respect of the same class of property, plant and equipment previously recognised as an expense (other economic flows) in the net result.

Net revaluation decrease is recognised in ‘other economic flows – other comprehensive income’ to the extent that a credit balance exists in the asset revaluation surplus in respect of the same class of property, plant and equipment. Otherwise, the net revaluation decreases are recognised immediately as other economic flows in the net result. The net revaluation decrease recognised in ‘other economic flows – other comprehensive income’ reduces the amount accumulated in equity under the asset revaluation surplus.


D R A F T


Revaluation increases and decreases relating to individual assets in a class of property, plant and equipment, are offset against one another in that class but are not offset in respect of assets in different classes. The asset revaluation surplus is not transferred to accumulated funds on derecognition of the relevant asset.

OtherPrepaymentsOther non-financial assets include prepayments which represent payments in advance of receipts of goods and services or that part of expenditure made in one accounting period covering a term extending beyond that period.

(l) LiabilitiesPayablesPayables consist of:• contractual payables, such as accounts payable, and

unearned income including deferred income from concession notes. Accounts payable represent liabilities for goods and services provided to the Trust prior to the end of the financial year that are unpaid, and arise when the Trust becomes obliged to make future payments in respect of the purchase of those goods and services; and

• statutory payables, such as goods and services tax and fringe benefits tax payables.

ProvisionsProvisions are recognised when the Trust has a present obligation, the future sacrifice of economic benefits is probable and the amount of the provision can be measured reliably.

The amount recognised as a provision is the best estimate of the consideration required to settle the present obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows, using a discount rate that reflects the time value of money and risks specific to the provision.

Employee Benefits(i) Wages, salaries and annual leave

Liabilities for wages and salaries, including non-monetary benefits and annual leave are recognised in the provision for employee benefits as ‘current liabilities’ because the Trust does not have an unconditional right to defer settlements of these liabilities.

Depending on the expectation of the timing of the settlement, liabilities for wages and salaries and annual leave are measured at:

• Nominal value – if the Trust expects to wholly settle within 12 months; or

• Present Value – if the Trust does not expect to wholly settle within 12 months.

(ii) Long Service Leave A liability for long service leave is recognised, and is measured

as the present value of expected future payments to be made in respect of services provided by employees up to

the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures and period of service. All unconditional vested long service leave representing 7 years or greater of continuous service is disclosed in accordance with AASB 101 Presentation of Financial Statements, as a current liability.

Liability for long service leave (LSL) is recognised in the provision for employee benefits

• Current liability unconditional LSL (representing seven or more years of continuous service for staff) is disclosed as a current liability even where the Trust does not expect to settle the liability within 12 months because it will not have the unconditional right to defer the settlement of the entitlement should an employee take leave within 12 months.

The components of this current LSL liability are measured at: – Present value – component that the Trust does not

expect to wholly settle within 12 months; and – Nominal value – component that the Trust expects to

wholly settle within 12 months.

• Non-current liability – conditional LSL (representing less than seven years of continuous service for staff) is disclosed as a non-current liability. There is an unconditional right to defer the settlement of the entitlement until the employee has completed the requisite years of service.

This non-current LSL liability is measured at present value.

Any gain or loss following revaluation of the present value of non-current LSL liability is recognised in the ‘net result from transactions’, except to the extent that a gain or loss arises due to changes in bond interest rates for which it is then recognised in the net result as another economic flow.

(iii) Termination benefits Termination benefits are payable when employment is

terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Trust recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after balance sheet date are discounted to present value.

Employee Benefit On-CostsEmployee benefits on-costs such as payroll tax and workers compensation are recognised separately from the provision for employee benefits.


D R A F T


(m) Income taxesThe Australian Taxation Office has deemed the Trust to be a “Public Authority” within the terms of Section 50-25 of the Income Tax Assessment Act 1997 and therefore any income shall be exempt from income tax. The Trust is not subject to the National Tax Equivalent Regime. No provisions for income taxes payable have been raised.

(n) Contingent assets and contingent liabilitiesContingent assets and contingent liabilities are not recognised in the balance sheet, but are disclosed by way of a noteand, if quantifiable, are measured at nominal value.

Contingent assets and contingent liabilities are presented inclusive of GST receivables or payables respectively.

(o) Cash flow statementFor the purposes of the cash flow statement, cash comprises petty cash, cash floats, deposits in bank accounts, cash at bank and short-term deposits.

(p) Rounding of AmountsAmounts in the financial statements have been rounded to the nearest $1,000 unless otherwise stated.

(q) Contributed CapitalTransfers from the Department of Economic Development, Jobs, Transport and Resources (Ecodev) that are in the nature of contributions or distributions of capital have also been designated as contributed capital. Other transfers that are in the nature of contributions or distributions have also been designated as contributions by owners.

(r) Intangible assetsIntangible assets represent identifiable non-monetary assets without physical substance. Intangible assets are initially recognised at cost. Cost incurred subsequent to initial acquisition are capitalised when it is expected that additional future economic benefits will flow to the Trust.

(s) Leased assetsMOPT as LessorRental income from operating leases is recognised on a straight line basis over the term of the relevant lease.

MOPT as LesseeAll leased assets are classified as operating leases.

Operating lease payments, including any contingent rentals, are recognised as an expense in the comprehensive operating statement on a straight line basis over the lease term, except where another systematic basis is more representative of the time pattern of the benefits derived from the use of the leased asset. The leased asset is not recognised in the balance sheet.

(t) CommitmentsCommitments for future expenditure include operating and capital commitments arising from contracts. These commitments are disclosed by way of a note (refer to Note 13 Commitments for expenditure) at their nominal value and inclusive of the GST payable. In addition, where it is considered appropriate and provides additional relevant information to users, the net present values of significant individual projects are stated. These future expenditures cease to be disclosed as commitments once the related liabilities are recognised in the balance sheet.


D R A F T

Standard/Interpretation1 Summary Applicable for annual reporting periods beginning on

Impact on public sector entity financial statements

AASB 9 Financial Instruments

The key changes include the simplified requirements for the classification and measurement of financial assets, a new hedging accounting model and a revised impairment loss model to recognise impairment losses earlier, as opposed to the current approach that recognises impairment only when incurred.

1 Jan 2018 The assessment has identified that the financial impact of available for sale (AFS) assets will now be reported through other comprehensive income (OCI) and no longer recycled to the profit and loss.

AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010)

The requirements for classifying and measuring financial liabilities were added to AASB 9. The existing requirements for the classification of financial liabilities and the ability to use the fair value option have been retained. However, where the fair value option is used for financial liabilities the change in fair value is accounted for as follows:

• The change in fair value attributable to changes in credit risk is presented in other comprehensive income (OCI); and

• Other fair value changes are presented in profit and loss. If this approach creates or enlarges an accounting mismatch in the profit or loss, the effect of the changes in credit risk are also presented in profit or loss.

1 Jan 2018 The assessment has identified that the amendments are likely to result in earlier recognition of impairment losses and at more regular intervals.

Changes in own credit risk in respect of liabilities designated at fair value through profit and loss will now be presented within other comprehensive income (OCI).

Hedge accounting will be more closely aligned with common risk management practices making it easier to have an effective hedge.

For entities with significant lending activities, an overhaul of related systems and processes may be needed.

AASB 2014-1 Amendments to Australian Accounting Standards [Part E Financial Instruments]

Amends various AASs to reflect the AASB’s decision to defer the mandatory application date of

AASB 9 to annual reporting periods beginning on or after 1 January 2018 as a consequence of Chapter 6 Hedge Accounting, and to amend reduced disclosure requirements.

1 Jan 2018 This amending standard will defer the application period of AASB 9 to the 2018-19 reporting period in accordance with the transition requirements.


(u) Australian Accounting Standards issued that are not yet effectiveCertain new AASs have been published that are not mandatory for the 30 June 2016 reporting period. DTF assesses the impact of these new standards and advises the Trust of their applicability and early adoption where applicable.


D R A F T

AASB 2014-7 Amendments to Australian Accounting Standards arising from AASB 9

Amends various AASs to incorporate the consequential amendments arising from the issuance of AASB 9.

1 Jan 2018 The assessment has indicated that there will be no significant impact for the public sector.

AASB 14 Regulatory Deferral Accounts2

AASB 14 permits first-time adopters of Australian Accounting Standards who conduct rate-regulated activities to continue to account for amounts related to rate regulation in accordance with their previous GAAP.

1 Jan 2016 The assessment has indicated that there is no expected impact, as those that conduct rate-regulated activities have already adopted Australian Accounting Standards.

AASB 15 Revenue from Contracts with Customers

The core principle of AASB 15 requires an entity to recognise revenue when the entity satisfies a performance obligation by transferring a promised good or service to a customer.

1 Jan 2018 The changes in revenue recognition requirements in AASB 15 may result in changes to the timing and amount of revenue recorded in the financial statements. The Standard will also require additional disclosures on service revenue and contract modifications.

A potential impact will be the upfront recognition of revenue from licenses that cover multiple reporting periods. Revenue that was deferred and amortised over a period may now need to be recognised immediately as a transitional adjustment against the opening returned earnings if there are no former performance obligations outstanding.

AASB 2014-5 Amendments to Australian Accounting Standards arising from AASB 15

Amends the measurement of trade receivables and the recognition of dividends.

Trade receivables, that do not have a significant financing component, are to be measured at their transaction price, at initial recognition.

Dividends are recognised in the profit and loss only when:

• the entity’s right to receive payment of the dividend is established;

• it is probable that the economic benefits associated with the dividend will flow to the entity; and

• the amount can be measured reliably.

1 Jan 2017, except amendments to AASB 9 (Dec 2009) and AASB 9 (Dec 2010) apply from 1 Jan 2018

The assessment has indicated that there will be no significant impact for the public sector.



D R A F T


AASB 2015-8 Amendments to Australian Accounting Standards – Effective Date of AASB 15

This Standard defers the mandatory effective date of AASB 15 from 1 January 2017 to 1 January 2018.

1 Jan 2018 This amending standard will defer the application period of AASB 15 to the 2018-19 reporting period in accordance with the transition requirements.

AASB 2016-3 Amendments to Australian Accounting Standards – Clarifications to AASB 15

This Standard amends AASB 15 to clarify the requirements on identifying performance obligations, principal versus agent considerations and the timing of recognising revenue from granting a licence. The amendments require:

• A promise to transfer to a customer a good or service that is ‘distinct’ to be recognised as a separate performance obligation;

• For items purchased online, the entity is a principal if it obtains control of the good or service prior to transferring to the customer; and

• For licences identified as being distinct from other goods or services in a contract, entities need to determine whether the licence transfers to the customer over time (right to use) or at a point in time (right to access).

1 Jan 2018 The assessment has indicated that there will be no significant impact for the public sector, other than the impact identified in AASB 15.

AASB 16 Leases The key changes introduced by AASB 16 include the recognition of most operating leases (which are current not recognised) on balance sheet.

1 Jan 2019 The assessment has indicated that as most operating leases will come on balance sheet, recognition of lease assets and lease liabilities will cause net debt to increase.

Depreciation of lease assets and interest on lease liabilities will be recognised in the income statement with marginal impact on the operating surplus.

The amounts of cash paid for the principal portion of the lease liability will be presented within financing activities and the amounts paid for the interest portion will be presented within operating activities in the cash flow statement.


D R A F T


AASB 2014-4 Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation [AASB 116 & AASB 138]

Amends AASB 116 Property, Plant and Equipment and AASB 138 Intangible Assets to:

• establish the principle for the basis of depreciation and amortisation as being the expected pattern of consumption of the future economic benefits of an asset;

• prohibit the use of revenue based methods to calculate the depreciation or amortisation of an asset, tangible or intangible, because revenue generally reflects the pattern of economic benefits that are generated from operating the business, rather than the consumption through the use of the asset.

1 Jan 2016 The assessment has indicated that there is no expected impact as the revenue-based method is not used for depreciation and amortisation.

AASB 2014-9 Amendments to Australian Accounting Standards – Equity Method in Separate Financial Statements [AASB 1, 127 & 128]

Amends AASB 127 Separate Financial Statements to allow entities to use the equity method of accounting for investments in subsidiaries, joint ventures and associates in their separate financial statements.

1 Jan 2016 The assessment indicates that there is no expected impact as the entity will continue to account for the investments in subsidiaries, joint ventures and associates using the cost method as mandated if separate financial statements are presented in accordance with FRD 113A.

AASB 2014-10 Amendments to Australian Accounting Standards – Sale or Contribution of Assets between an Investor and its Associate or Joint Venture [AASB 10 & AASB 128]

AASB 2014-10 amends AASB 10 Consolidated Financial Statements and AASB 128 Investments in Associates to ensure consistent treatment in dealing with the sale or contribution of assets between an investor and its associate or joint venture. The amendments require that:

• a full gain or loss to be recognised by the investor when a transaction involves a business (whether it is housed in a subsidiary or not); and

• a partial gain or loss to be recognised by the parent when a transaction involves assets that do not constitute a business, even if these assets are housed in a subsidiary.

1 Jan 2016 The assessment has indicated that there is limited impact, as the revisions to AASB 10 and AASB 128 are guidance in nature.


D R A F T


AASB 2015-1 Amendments to Australian Accounting Standards – Annual Improvements to Australian Accounting Standards 2012-2014 Cycle [AASB 1, AASB 2, AASB 3, AASB 5, AASB 7, AASB 11, AASB 110, AASB 119, AASB 121, AASB 133, AASB 134, AASB 137 & AASB 140]

Amends the methods of disposal in AASB 5 Non-current assets held for sale and discontinued operations.

Amends AASB 7 Financial Instruments by including further guidance on servicing contracts.

1 Jan 2016 The assessment has indicated that when an asset (or disposal group) is reclassified from ‘held to sale’ to ‘held for distribution’, or vice versa, the asset does not have to be reinstated in the financial statements.

Entities will be required to disclose all types of continuing involvement the entity still has when transferring a financial asset to a third party under conditions which allow it to derecognise the asset.

AASB 2015-6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-for-Profit Public Sector Entities

[AASB 10, AASB 124 & AASB 1049]

The Amendments extend the scope of AASB 124 Related Party Disclosures to not-for-profit public sector entities. A guidance has been included to assist the application of the Standard by not-for-profit public sector entities.

1 Jan 2016 The amending standard will result in extended disclosures on the entity's key management personnel (KMP), and the related party transactions.

AASB 2016-4 Amendments to Australian Accounting Standards – Recoverable Amount of Non-Cash-Generating Specialised Assets of Not-for-Profit Entities

The standard amends AASB 136 Impairment of Assets to remove references to using depreciated replacement cost (DRC) as a measure of value in use for not-for-profit entities.

1 Jan 2017 The assessment has indicated that there is minimal impact. Given the specialised nature and restrictions of public sector assets, the existing use is presumed to be the highest and best use (HBU), hence current replacement cost under AASB 13 Fair Value Measurement is the same as the depreciated replacement cost concept under AASB 136.

Note: Amending standard AASB 2015 7 Amendments to Australian Accounting Standards – Fair Value Disclosures of Not for Profit Public Sector Entities, which is operative from 1 July 2016 provides an exemption for not for profit public sector entities from certain fair value disclosures. Please note that the State early adopted AASB 2015 7 in the 2014 15 reporting period and gave not for profit entities the option to early adopt this amending standard last year. As a result, all not for profit entities must now comply this amending standard for the current financial year.

There are a number of non-mandatory standards at 30 June 2016 not listed which have been assessed to have minimal or no impact to the Trust.


D R A F T

2. INCOME FROM TRANSACTIONS

2016$’000

2015$’000

(a) Sales of goods and servicesSale of goods 13,241 11,622Rendering of services 67,930 63,635Royalties 13,437 12,617

94,608 87,874

(b) InterestInterest on bank deposits 887 1,456

887 1,456

(c) Other incomeDelaware North Australia Sinking Fund 505 455Delaware North Australia Capital Contribution 615 843Tennis Australia Special Purpose Account 526 537Cancelled Event Ticket Income 3 226

1,648 2,061



D R A F T


3. EXPENSES FROM TRANSACTIONS

NOTE 2016$’000

2015$’000

(a) Cost of goods/sold distributed

Venue Hire 3,064 3,408Catering 11,769 10,433Other 822 603

15,655 14,444

(b) Purchase of servicesAdministration 4,186 3,951

Event Contractors 12,716 9,807

Utilities 3,254 3,604

Recruitment, Training & Development 510 605

Other 1,342 1,717

22,008 19,684

(c) Employee expensesDefined contribution superannuation expense 21 1,436 1,394Termination benefits 128 48Salaries, wages, annual leave and long service leave 16,673 15,915

18,237 17,357

(d) Other operating expensesMaintenance 5,745 5,390Operating lease expenses 183 199Purchase of supplies and consumables 801 990Other 4 198

6,733 6,777

(e) Government Financial TransfersPayment to Government for support of sport and recreation programs 3,000 3,000

3,000 3,000


D R A F T


4. OTHER ECONOMIC FLOWS INCLUDED IN NET RESULT

2016$’000

2015$’000

(a) Net gain/(loss) on non-financial assets

Net gain/(loss) on disposal of property plant and equipment 87 -

(including intangible assets)

87 -

(b) Net gain/(loss) arising from revaluation of long service liability

Net gain/(loss) arising from revaluation of long service liability 93 67

93 67

5. CASH AND CASH EQUIVALENTS

2016$’000

2015$’000

Cash floats held 88 104Cash at bank 41,623 11,020Term deposits 4,750 44,800Bank deposits (restricted use) 601 2,186Total Cash and cash equivalents 47,062 58,110

6. RECEIVABLES

2016$’000

2015$’000

CurrentContractualOther receivables (ii) 3,338 3,272Provision for doubtful debts (iii) (5) (5)

3,333 3,267StatutoryAmount owing from Victorian Government (i) 112 302Taxes Recoverable 1,571 1,179

1,683 1,481

Total current receivables 5,016 4,748

(i) The amounts receivable from the Victorian Government represent monies owing from Victorian Government Departments/Agencies relating to contributions towards capital projects, tenancies and redevelopment costs.

(ii) Receivables are carried at nominal amounts due. The average credit period on settling of monies owed is 7 days. No interest is charged on other receivables for outstanding balances.

(iii) A provision has been made for amounts where collection is considered no longer probable, determined by reference to issues relating to individual accounts.


D R A F T


2016$’000

2015$’000

(a) Movement in the allowance for doubtful debts

Balance at beginning of financial year 5 5 Balance at end of financial year 5 5

(b) Ageing analysis of receivables

Please refer to Table 16.3 in Note 16 for ageing analysis of receivables.

(c) Nature and extent of risk arising from receivables

Please refer to Note 16 for the nature and extent of credit risk arising from receivables.

7. PROPERTY, PLANT, EQUIPMENT AND INTANGIBLE ASSETS

2016$’000

2015$’000

Land at fair value 478,236 387,600

478,236 387,600

Buildings and improvements 458,158 458,158

Buildings at fair value 291,337 290,480

Less accumulated depreciation (62,040) (44,750)

Written down value 687,455 703,888

Plant and equipment 93,074 93,074

Plant and equipment at fair value 156,416 145,131


Written down value 195,709 197,875

Work in progress 113,170 37,021

113,170 37,021

Total property, plant and equipment 1,590,391 1,411,464


Written down value 1,474,570 1,326,384

Intangible Assets 1,908 1,606

Less accumulated amortisation (1,412) (1,161)

Written down value 496 445

Written down value property, plant, equipment and intangible assets 1,475,066 1,326,829


D R A F T


(i) Land at fair value 30 June 2012

Land was last independently revalued at 30 June 2012 as required by the Financial Management Act 1994 and was conducted by the Valuer-General Victoria. Due to restrictions on the usage of the land, a notional discount of 40% known as ‘Community Service Obligation’ has been applied to the Unrestricted Land Value.

(ii) Buildings and Improvements and Plant and Equipment at revaluation 2012

Buildings, Plant & Equipment was last independently revalued at 30 June 2012 as required by the Financial Management Act 1994 and was conducted by Napier & Blakeley on behalf of the Valuer-General Victoria who have provided replacement cost and depreciated replacement cost on the inspected properties (Rod Laver Arena and surrounding grounds, Hisense Arena, AAMI Park and Westpac Centre). Works in Progress relating to the redevelopment have not been included in the revaluation.

RECONCILIATIONS

Classification by ‘Public safety and environment’ purpose group – Movements in carrying amounts

Land at fair value

Buildings at fair value

Plant & Equipment

at fair value

Intangibles at fair value

Work in Progress at

cost

Total

$’000 $’000 $’000 $’000 $’000 $’000

Year ended 30 June 2016Carrying amount at start of year 387,600 703,888 197,875 445 37,021 1,326,829Additions - 759 7,186 303 85,398 93,646Transfers - 4,713 4,536 - (9,249) - Disposals - (4,550) (49) - - (4,599)Revaluations/Impairments 90,636 - - - - 90,636Depreciation Expense - (17,355) (13,839) - - (31,194)Amortisation Expense - - - (252) - (252)Carrying amount at end of year 478,236 687,455 195,709 496 113,170 1,475,066

Land at fair value

Buildings at fair value

Plant & Equipment

at fair value

Intangibles at fair value

Work in Progress at

cost

Total

$’000 $’000 $’000 $’000 $’000 $’000

Year ended 30 June 2015Carrying amount at start of year 387,600 544,018 151,494 570 209,369 1,293,051Additions - - 6,844 27 56,369 63,240Transfers - 177,038 51,633 46 (228,717) -Disposals - - (13) - - (13)Revaluations/Impairments - - - - - -Depreciation Expense - (17,168) (12,083) - - (29,251)Amortisation Expense - - - (198) - (198)Carrying amount at end of year 387,600 703,888 197,875 445 37,021 1,326,829

Aggregate depreciation & amortisation recognised as an expense during the year (i)

2016 2015

$'000 $'000 Buildings at fair value 17,355 17,170 Plant, equipment and vehicles at fair value 13,839 12,083 Intangibles at fair value 252 198

31,446 29,451

Notes:

(i) The useful lives of assets as stated in Note 1 are used in the calculation of depreciation


D R A F T


Fair value measurement hierarchy for assets

Carrying amount as at 30 June

2016

Fair Value Measurement as t 30 June 2016 using:

Level 1 Level 2 Level 3

$’000 $’000 $’000 $’000

Land at fair value Specialised land 478,236 - - 478,236Total of land at fair value 478,236 - - 478,236Buildings at fair value Specialised buildings 687,455 - - 687,455Total of buildings at fair value 687,455 - - 687,455Plant, equipment and vehicles at fair value Vehicles 189 - - 189 Plant and equipment 195,520 - - 195,520Total of plant, equipment and vehicles at fair value 195,709 - - 195,709

Carrying amount as at 30 June

2015

Fair Value Measurement as at 30 June 2015 using:

Level 1 Level 2 Level 3

$’000 $’000 $’000 $’000

Land at fair value Specialised land 387,600 - - 387,600Total of land at fair value 387,600 - - 387,600Buildings at fair value Specialised buildings 703,888 - - 703,888Total of buildings at fair value 703,888 - - 703,888Plant, equipment and vehicles at fair value Vehicles 298 - - 298 Plant and equipment 197,577 - - 197,577Total of plant, equipment and vehicles at fair value 197,875 - - 197,875

Specialised land and specialised buildingsThe market approach is also used for specialised land, although is adjusted for the community service obligation (CSO) to reflect the specialised nature of the land being valued.

The CSO adjustment is a reflection of the valuer’s assessment of the impact of restrictions associated with an asset to the extent that is also equally applicable to market participants. This approach is in light of the highest and best use consideration required for fair value measurement, and takes into account the use of the asset that is physically possible, legally permissible, and financially feasible. As adjustments of CSO are considered as significant unobservable inputs, specialised land would be classified as Level 3 assets.

For the Trust’s majority of specialised buildings, the depreciated replacement cost method is used, adjusting for the associated depreciations. As depreciation adjustments are considered as significant, unobservable inputs in nature, specialised buildings are classified as Level 3 fair value measurements.

An independent valuation of the Trust’s specialised land and specialised buildings was performed by the Valuer-General Victoria. The valuation was performed using the market approach adjusted for CSO. The effective date of the valuation is 30 June 2012.

VehiclesVehicles are valued using the depreciated replacement cost method. The Trust acquires new vehicles and at times disposes of them before the end of their economic life. The process of acquisition, use and disposal in the market is managed within the Trust. Depreciation rates are set to reflect the utilisation of the vehicles.


D R A F T2016 Specialised landSpecialised

buildings VehiclesPlant and

equipment

$'000 $'000 $'000 $'000

Opening balance 387,600 703,889 298 197,577

Purchases (sales) - 922 - 11,673

Transfers in (out) of - - - -

Level 3

Gains or losses recognised in net result

Depreciation - (17,355) - (13,839)

Impairment loss - - - -

Subtotal - (17,355) - (13,839)

Gains or losses recognised in other economic flows - other comprehensive income

Revaluation 90,636 - - -

Subtotal 90,636 - - -

Closing balance 478,236 687,455 298 195,411

Unrealised gains/(losses) on non-financial assets - - - -

2015 Specialised landSpecialised

buildings VehiclesPlant and

equipment

$'000 $'000 $'000 $'000

Opening balance 387,600 544,018 349 151,145

Purchases (sales) - 177,040 88 58,376

Transfers in (out) of - - - -

Level 3

Gains or losses recognised in net result

Depreciation - (17,170) (139) (11,944)

Impairment loss - - - -

Subtotal - (17,170) (139) (11,944)

Gains or losses recognised in other economic flows - other comprehensive income

Revaluation - - - -

Subtotal - - - -

Closing balance 387,600 703,888 298 197,577

Unrealised gains/(losses) on non-financial assets - - - -


Plant and equipmentPlant and equipment is held at fair value. When plant and equipment is specialised in use, such that it is rarely sold other than as part of a going concern, fair value is determined using the depreciated replacement cost method.

There were no changes in valuation techniques throughout the period to 30 June 2016.

For all assets measured at fair value, the current use is considered the highest and best use.

Reconciliation of level 3 fair value


D R A F T


Description of significant unobservable inputs to Level 3 valuations

Valuation Technique Significant unobservable inputs

Land Market value adjusted for Community Service Obligation (CSO)

- Land price per square metre.

- CSO obligation.

Rod Laver Arena / Melbourne Park

Depreciated replacement cost - useful lives of structure / shell / building fabric, site engineering services & central plant, fit-outs and trunk reticulated building systems.

- replacement cost per m² and per unit of plant. This reflects the cost of replacing Rod Laver Arena/Melbourne Park to its current condition taking into account its age (27 years).

Hisense Arena Depreciated replacement cost - useful lives of structure / shell / building fabric, site engineering services & central plant, fit-outs and trunk reticulated building systems.

- replacement cost per m² and per unit of plant. This reflects the cost of replacing Hisense Arena to its current condition taking into account its age (15 years).

Margaret Court Arena Depreciated replacement cost - useful lives of structure / shell / building fabric, site engineering services & central plant, fit-outs and trunk reticulated building systems.

- replacement cost per m² and per unit of plant. This reflects the cost of replacing Margaret Court Arena to its current condition taking into account its age (1 year).

AAMI Park Depreciated replacement cost - useful lives of structure / shell / building fabric, site engineering services & central plant, fit-outs and trunk reticulated building systems.

- replacement cost per m² and per unit of plant. This reflects the cost of replacing AAMI Park to its current condition taking into account its age (5 years).

Westpac Centre Depreciated replacement cost - useful lives of structure / shell / building fabric, site engineering services & central plant, fit-outs and trunk reticulated building systems.

- replacement cost per m² and per unit of plant. This reflects the cost of replacing the Westpac Centre to its current condition taking into account its age (59 years).

Building Refurbishments Depreciated replacement cost - useful life of a fit-out of items with the building with fairly long life spans, i.e. Guard-rails, catwalks, seating, tracks/sporting specific items that are not electronic

- Useful life of items of a soft nature with in building includes carpets, lighting, wall fixtures, furniture and fittings that cannot be readily separated from the initial building purchase

Vehicles Depreciated replacement cost - Cost per unit.

- Useful life of vehicles.

Plant and equipment Depreciated replacement cost - Cost per unit.

- Useful life of plant and equipment.


D R A F T

8. OTHER ASSETS

2016$’000

2015$’000

CurrentPrepayments 378 255

378 255

9. PAYABLES

2016$’000

2015$’000

CurrentContractualTrade creditors (i) 626 150Other payables 3,186 1,803Accrued expenses 16,666 15,051

20,478 17,004

Statutory

Taxes payable 50 64

Total current payables 20,528 17,068

(i) The average credit period is 30 days. No interest is charged on other payables for the first 30 days from the date of invoice. Payables are generally paid within the

payment period thereby avoiding any interest charges that may be incurred on late payments.

(a) Maturity analysis of payables Please refer to Table 16.5 in Note 16 for the aging analysis of payables.

(b) Nature and extent of risk arising from payables Please refer to Note 16 for the nature and extent of risks arising from payables.



D R A F T


10. PROVISIONS

2016$’000

2015$’000

Current provisions

Annual LeaveUnconditional and expected to be settled within 12 months (i) 281 293Unconditional and expected to be settled after 12 months (ii) 293 307

Long Service LeaveUnconditional and expected to be settled within 12 months (i) 829 795Unconditional and expected to be settled after 12 months (ii) 869 854

2,272 2,249

Provisions for on-costsUnconditional and expected to be settled within 12 months (i) 182 181Unconditional and expected to be settled after 12 months (ii) 190 194

372 375

Total current provisions 2,644 2,624

Non-current provisions

Long Service Leave (ii) 373 385

On-costs 59 61

Total non-current provisions 432 446

Total provisions 3,076 3,070

(i) The amounts disclosed are nominal amounts. (ii) The amounts disclosed are discounted to present values.


D R A F T


(a) Employee benefits and on-costs

2016$’000

2015$’000

Current employee benefits

Annual Leave 574 600Long Service Leave 1,698 1,649

Non-current employee benefitsLong Service Leave 373 385

Total employee benefits 2,645 2,634

Current on-costs 372 375Non-current on-costs 59 61

Total on-costs 431 436

Total employee benefits and on-costs 3,076 3,070

(b) Movement in provisions

On-costs On-costs2016 2015

$'000 $'000

Opening Balance 436 412Additional provisions recognised 170 183Reductions arising from payments/other sacrifices of future economic benefits (172) (143)Reductions resulting from re-measurement or settlement without cost (18) (27)Unwind of discount and effect of changes in the discount rate 15 11

Closing Balance 431 436

Current 372 375Non-current 59 61

Closing Balance 431 436

11. OTHER LIABILITIES

2016$’000

2015$’000

Income received in advance 8,045 11,605Ticket sales for future events held in trust 20,440 46,590

28,485 58,195

Note 10. Provisions (continued)


D R A F T


Operating Lease Receivables

Leasing arrangements

Operating lease receivables relate to 13 tenancies (12 in 2014-15) within the Trust’s precinct with lease terms between 1 and 20 years.

2016$’000

2015$’000

Receivable no later than one year 4,786 4,007

Later than one year and not later than five years 17,592 16,315

Later than five years 40,056 35,773

62,434 56,095

13. COMMITMENTS FOR EXPENDITUREThe following commitments have not been recognised as liabilities in the financial statements. All amounts shown in the commitments note are nominal amounts inclusive of GST.

(a) Capital expenditure commitmentsThe Trust has no further commitments for capital works relating to stage 2 of the Melbourne Park redevelopment project at the date of this report (2015: $25.6m). All other capital commitments relating to the Melbourne Park redevelopment project sit with Major Project Victoria, who are the project manager.

2016$’000

2015$’000

Less than one year - 25,647

- 25,647

12. LEASES

Operating lease payablesLeasing arrangementsOperating lease payables relate to plant and office equipment with lease terms between 1 and 2 years.

Non-cancellable operating leasesTotal lease expenditure contracted for at balance date but not provided for in the accounts:

2016$’000

2015$’000

Payable not longer than one year 4 84Longer than one year and not longer than five years - 4

4 88


D R A F T


14. CONTINGENT LIABILITIESThe Trust has no contingent liabilities at the date of this report.

15. CONTINGENT ASSETSThere is a contingent asset in relation to Collingwood Football Club’s ground lease at Olympic Park. In December 2013, the Collingwood Football Club was granted permission by the Trust for the construction of the Olympic Park Community Facility on the Trust’s land. Ownership of improvements to the land and any buildings will transfer to the Trust upon expiration of the current lease on 31 May 2033.

16. FINANCIAL INSTRUMENTS

(a) Significant accounting policiesThe Trust’s principal financial instruments comprise:

• cash assets;

• term deposits;

• receivables (excluding statutory receivables); and

• payables (excluding statutory payables).

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and the basis on which income and expenses are recognised, with respect to each class of financial asset, financial liability and equity instrument are disclosed in Note 1 to the financial statements.

The main purpose in holding financial instruments is to prudentially manage the Trust’s financial risks in the government policy parameters.

The Trust’s main financial risks include credit risk, liquidity risk and interest rate risk. The Trust manages these risks in accordance with its treasury policy.

Primary responsibility for the identification and management of financial risks rests with the Finance, Audit and Risk committee of the Trust.

(b) Operating expenditure commitmentsThe Trust has $0.2m in commitments for operating expenditure relating to the supply of service agreements for mechanical services and lifts at the date of this report (2015: $0.9m).

2016$’000

2015$’000

Payable no later than one year 237 657

Longer than one year and not later than five years - 237

237 894

(c) Lease commitmentsNon-cancellable operating lease commitments are disclosed in Note 12 of the financial statements.


D R A F T


(b) Table 16.1: Categorisation of financial instruments

NOTES

Contractual financial

assets - loans and receivables

Contractual financial

liablilities at amortised cost Total

$'000 $'000 $'000

2016

Financial assets (i)

Cash and cash equivalents 5 42,312 - 42,315

Cash held on behalf of customers 20,440 - 20,440

Total Cash 62,752 - 62,752

Receivables: (i)

Total Receivables 6 3,338 - 3,338

Investments and other contractual financial assets:

Term deposits 5 4,750 - 4,750

Total contractual financial assets 70,840 - 70,840

Contractual financial liabilities

Payables: (i)

Supplies and services 9 - 20,478 20,478

Other payables 11 - 20,440 20,440

Total contractual financial liabilities - 40,918 40,918

(i) The amount of receivables and payables disclosed exclude statutory amounts (e.g.: amounts owing from Victorian Government and GST input tax credit recoverable and taxes payable)


D R A F T

(c) Credit risk exposureCredit risk arises when there is the possibility of the Trust’s debtors defaulting on their contractual obligations resulting in financial loss to the Trust. The Trust measures credit risk on a fair value basis and monitors risk on a regular basis.

The Trust does not have any significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics. The Trust has adopted a policy of only dealing with creditworthy counterparties and obtaining sufficient collateral or credit enhancements where appropriate (in the form of a deposit or other guarantee), as a means of mitigating the risk of financial loss from defaults. Credit risk in trade receivables is managed by payment terms of seven days and sound debt collection policies and procedures.

In addition, the Trust does not engage in any hedging for its financial assets. The credit risk on liquid funds is limited because the counterparties are banks with high credit-ratings assigned by international credit-rating agencies.

Provision of impairment for financial assets is calculated based on past experience, and current and expected changes in client credit ratings.

The carrying amount of financial assets recorded in the Financial Report, net of any allowances for losses, represents theTrust’s maximum exposure to credit risk without taking account of the value of any collateral obtained.

Financial assets that are either past due or impairedCurrently the Trust does not hold any collateral as security nor credit enhancements relating to any of its financial assets.

As at the reporting date, there is no event to indicate that any of the financial assets are impaired.

There are no financial assets that have had their terms renegotiated so as to prevent them from being past due or impaired and they are stated at the carrying amounts as indicated. The following table discloses the ageing only of financial assets that are past due but not impaired:


Table 16.2: Credit quality of contractual financial assets that are neither past due nor impaired

2016Government agencies (triple-A credit rating)

Other (min triple-A credit rating) Total

Cash and cash equivalents 36,241 6,071 42,312

Cash held on behalf of customers 4,605 16,041 20,646

Receivables (i) - 3,338 3,338

Investments and other financial assets 2,750 2,000 4,750

Total contractual financial assets 43,596 27,450 71,046

2015

Cash and cash equivalents 8,229 5,081 13,310

Cash held on behalf of customers 446 46,144 46,590

Receivables (i) - 3,272 3,272

Investments and other financial assets 42,800 2,000 44,800

Total contractual financial assets 51,475 56,497 107,972

(ii) The amount of receivables and payables disclosed exclude statutory amounts (e.g.: amounts owing from Victorian Government and GST input tax credit recoverable and taxes payable)


D R A F T


(d) Liquidity risk

Liquidity risk arises when the Trust is unable to meet its financial obligations as they fall due. The Trust operates under the Government fair payments policy of settling financial obligations within 30 days and in the event of a dispute, makes payments within 30 days from the date of resolution. It also continuously manages risk through monitoring future cash flows and maturities planning to ensure adequate holding of high quality liquid assets and dealing in highly liquid markets.

The Trust’s exposure to liquidity risk is deemed insignificant based on prior periods’ data and current assessment of risk.

Cash for unexpected events could be sourced from early liquidation of cash held on deposit if required.

Maximum exposure to liquidity risk is the carrying amounts of financial liabilities.

Table 16.3: Ageing analysis of contractual financial assets

Carryingamount

Not pastdue & notimpaired

Past due but not impaired

Lessthan 1month

1-3months

3months- 1 year

1-5years

30 June 2016 $'000 $'000 $'000 $'000 $'000 $'000

Receivables (i) 3,338 2,632 398 307 - -

3,338 2,632 398 307 - -

30 June 2015 $'000 $'000 $'000 $'000 $'000 $'000

Receivables (i) 3,272 2,906 349 17 - -

3,272 2,906 349 17 - -

(i) Ageing analysis of financial assets excludes statutory financial assets (e.g.: amounts owing from Victorian Government and GST input tax credits recoverable).


D R A F T


Table 16.4: Interest rate exposure of financial assets

Weighted average interest

rate

Carrying amount Interest rate exposure

Fixed interest

rate

Variable interest

rate

Non-interest bearing

30 June 2016 % $'000 $'000 $'000 $'000

Cash and cash equivalents:

Cash floats held 88 - - 88

Cash at bank 1.36% 41,623 - 41,623 -

Term deposits 1.99% 4,750 - 4,750 -

Bank deposits (restricted use) 1.65% 601 - 601 -

Cash at bank (ticket sales for future events - not available for use) 2.79% 20,440 - 20,440 -

Receivables (i) 3,338 - - 3,338

70,840 - 67,414 3,426

30 June 2015 % $'000 $'000 $'000 $'000

Cash and cash equivalents:

Cash floats held 104 - - 104

Cash at bank 1.92% 11,020 - 11,020 -

Term deposits 2.19% 44,800 - 44,800 -

Bank deposits (restricted use) 1.93% 2,186 - 2,186 -

Cash at bank (ticket sales for future events - not available for use) 2.90% 46,590 - 46,590 -

Receivables (i) 3,272 - - 3,272

107,972 - 104,596 3,376

(i) Ageing analysis of financial assets excludes statutory financial assets (e.g.: amounts owing from Victorian Government and GST input tax credits recoverable).


D R A F T


Table 16.5: Interest rate exposure and maturity analysis of financial liabilities

Carryingamount

Interest rate exposure

Nominalamount

Maturity dates (i)

Variableinterest

rate

Non-interestbearing

Lessthan 1month

1-3months

3months- 1 year

1-5years

30 June 2016 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 Payables (ii) 20,478 - 20,478 20,478 20,478 - - -Other 20,440 - 20,440 20,440 7,689 4,864 7,887 -

40,918 - 40,918 40,918 28,167 4,864 7,887 -

30 June 2015 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000Payables (ii) 17,004 - 17,004 17,004 17,004 - - -Other 46,589 - 46,589 46,589 3,694 4,590 38,305 -

63,593 - 63,593 63,593 20,698 4,590 38,305 -

(i) The amounts disclosed are the contractual undiscounted cash flows of each class of financial liabilities.

(ii) The carrying amounts disclosed exclude statutory amounts (e.g.: amounts payable to Victorian Government and taxes payable).

(e) Market risk

The Trust’s exposures to market risk, including interest rate risk and foreign currency are insignificant. Objectives, policiesand processes used to manage each of these risks are disclosed in the paragraphs below.

Foreign currency riskThe Trust is exposed to insignificant foreign currency risk through its payables relating to purchases of supplies and consumables from overseas, due to the limited amount of purchases denominated in foreign currencies and the short timeframe between commitment and settlement.

The Trust’s exposure to foreign currency risk is set out in Table 16.6.

Interest rate riskThe Trust is exposed to insignificant interest rate risk as it does not have any loans. Additionally, monies on term deposits are with financial institutions with high credit ratings. Sensitivity analyses shown are for illustrative purposes only. The following movements are ‘reasonably possible’ over the next 12 months:

• a movement of 100 basis points up and down (100 basis points up and down) in market interest rates (AUD);

The Trust’s exposure to interest rate risk is set out in Table 16.6.


D R A F T


Table 16.6: Market risk

Foreign exchangerisk

Interest rate risk

-10% / 10% -1%

(100 basis points)+1%

(100 basis points)

Carryingamount

Profit Equity Profit Equity Profit Equity

30 June 2016 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Contractual financial assets:

Cash and cash equivalents 42,312 - - (423) (423) 423 423

Cash held on behalf of customers 20,440 - - (204) (204) 204 204

Investments and other contractual financial assets

4,750 - - (48) (48) 48 48

Total Impact - - (675) (675) 675 675

30 June 2015 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Contractual financial assets:

Cash and cash equivalents 13,310 - - (133) (133) 133 133

Cash held on behalf of customers 46,589 - - (466) (466) 466 466

Investments and other contractual financial assets 44,800 - - (448) (448) 448 448

Total Impact - - (1,047) (1,047) 1,047 1,047

(f) Fair value

The Trust considers that the carrying amount of financial assets and financial liabilities recorded in the financial report to be a fair approximation of their fair values, because of the short-term nature of the financial instruments and the expectation that they will be paid in full.


D R A F T


17. CASH FLOW INFORMATION

(a) Reconciliation of cash and cash equivalents

2016$’000

2015$’000

Total cash and cash equivalents disclosed in note 5 47,062 58,110

Balance as per cash flow statement 47,062 58,110

(b) Reconciliation of net result for the period to net cash flows from operating activities

2016$’000

2015$’000

Net Result for the financial year 244 745

Add/(less) non-cash movements:

Depreciation and amortisation of non-current assets 31,446 29,451

Net gain/(loss) on non-financial assets (87) -

Movements in assets and liabilities:

(Increase)/decrease in current receivables (268) (1,973)

(Increase)/decrease in other current assets (123) 46

(Decrease)/increase in current payables (716) 5,234

(Decrease)/increase in current provisions 20 208

(Decrease)/increase in other current liabilities (3,768) (255)

(Decrease)/increase in non-current provisions (14) (47)

Net cash flows from/(used in) operating activities 26,734 33,409


D R A F T

18. RESPONSIBLE PERSONS

In accordance with the Ministerial Directions issued by the Minister for Finance under the Financial Management Act 1994, the following disclosures are made regarding responsible persons for the reporting period.

NamesThe persons who held the positions of Ministers and Accountable Officers for the Trust are as follows:

PremierThe Honourable Daniel Andrews, Premier of Victoria

MinisterThe Honourable John Eren, Minister for Sport, Minister for Tourism and Major Events and Minister for Veterans Affairs

TrustMr Russell Caplan (Chairperson)Ms Jacinda Dixon (from 05/04/2016)Mr William Fowles (from 22/12/2015)Mr Stephen HealyMs Sharelle McMahon (to 12/05/2016)Ms Diana NicholsonMr John Ribot-de-Bresac (from 22/12/2015)Mr Kenneth Roche, AOMr Raymond SmithMs Mikaela StafraceMr David StobartMr Scott Tanner (to 11/12/2015)

Trust Secretary and Chief Executive OfficerMr Brian Morris

RemunerationTotal remuneration (including incentive payments) received or receivable by the Accountable Officer in connection with the management of the Trust during the reporting period was in the range of $470,000 - $479,999 ($450,000 - $459,999 in 2014-15).

Trustees did not receive any remuneration from the Trust during the financial year. (2014-15: $0).

Related party transactionsCommercial dealings were undertaken during the reporting period with Tennis Australia and Tennis Victoria, both of which have representatives holding positions as Trustees on the Melbourne & Olympic Parks Trust.

During 2015-16, the Trust invoiced Tennis Australia $34,184,986 ($30,077,095 in 2014-15) and as at 30 June 2016, Tennis Australia owed the Trust $57,738 ($640,400 at 30 June 2015). Mr Stephen Healy and Mr Scott Tanner (to 11/12/2015) hold positions on the Melbourne & Olympic Parks Trust and also hold positions at Tennis Australia (President and Director to 11/12/2015 respectively). Tennis Australia is the promoter of the Australian Open event and runs a court hire business on the Trust’s premises and also rents office space from the Trust.

During 2015-16, the Trust invoiced Tennis Victoria $170,108 ($199,062 in 2014-15) and at 30 June 2016, Tennis Victoria owed the Trust $22,741 ($11,731 at 30 June 2015). Mr David Stobart holds a position on the Melbourne & Olympic Parks Trust and also held the position of President of Tennis Victoria (to 19/08/2015). Tennis Victoria rents office space on the Trust’s premises and purchase related services from the Trust.

There are no other receivable amounts or loans outstanding in relation to related parties, as at 30 June 2016 ($0 in 2014-15).



D R A F T


19. REMUNERATION OF EXECUTIVES, EMPLOYEES WITH MANAGEMENT RESPONSIBILITIES AND PAYMENTS TO OTHER PERSONNEL

(a) Remuneration of executive officersThe number of Executive Officers and employees with management responsibilities, other than the Accountable Officer, and their total remuneration during the reporting period are shown in the first two columns in the tables below in their relevant income bands. The base remuneration of is shown in the third column and a comparative to the prior year in the fourth column. Base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits.

Income band Total Remuneration Base Remuneration

2016 2015 2016 2015 No. No. No. No.

$110,000 - $119,999 2 1 2 2$120,000 - $129,999 - 1 - -$150,000 - $159,999 3 3 3 3$160,000 - $169,999 1 2 1 2$170,000 - $179,999 1 - 1 -$220,000 - $229,999 - 1 - 1$230,000 - $239,999 1 1 1 1$250,000 - $259,999 1 1 1 1$270,000 - $279,999 1 - 1 -$280,000 - $289,999 1 - 1 -

Total numbers 11 10 11 10

$'000 $'000 $'000 $'000

Total remuneration 2,081 1,742 2,081 1,736

(b) Remuneration of employees with management responsibilities

Income band Total Remuneration Base Remuneration

2016 2015 2016 2015 No. No. No. No.

$100,000 - $109,999 7 4 7 4$110,000 - $119,999 4 4 4 4$120,000 - $129,999 1 1 1 1$130,000 - $139,999 2 3 2 3$140,000 - $149,999 3 1 3 1Total numbers 17 13 17 13

$'000 $'000 $'000 $'000

Total remuneration 2,015 1,559 2,018 1,555


D R A F T20. REMUNERATION OF AUDITORS

Audit fees paid or payable to the Victorian Auditor-General’s Office (VAGO) for the audit of the Trust’s financial report and KPMG for the Trust’s internal audit program:

2016$’000

2015$’000

Audit or review of the financial statements - VAGO 57 56Internal audit services - KPMG 161 81

218 137


(c) Payments to other personnel (i.e. contractors with significant management responsibilities)The following disclosures are made in relation to other personnel of Melbourne & Olympic Parks Trust, i.e. contractors charged with significant management responsibilities.

Payments in the prior year have been made to a contractor with significant management responsibilities, which are disclosed in the $10,000 expense band. This contractor is responsible for planning, directing or controlling, directly or indirectly, the Trust’s activities.

Expense band Total Expenses (exclusive of GST)

2016 2015

No. No.

$170,000 - $179,999 - 1

Total numbers - 1

$'000 $'000

Total expenses (exclusive of GST) - 172


D R A F T


At the reporting date, superannuation contributions outstanding were $0 (2015: $0).

22. SUBSEQUENT EVENTS

No material or significant events occurred after the reporting date.

21. EMPLOYEE SUPERANNUATION

Superannuation contributions for the reporting period are included as part of employee benefits and on-costs in the comprehensive operating statement of the Trust.

The name and details of the major employee superannuation funds and contributions (above $10,000) made by the Trust during the reporting period are as follows:

2016$’000

2015$’000

AustralianSuper 845 860Hostplus 93 105Navigator Super Solutions 73 78Retail Employees Superannuation Pty Ltd 57 34First State Super Fund 39 22VicSuper Pty Ltd 37 24Care Super 32 35Colonial First State First Choice PERSONAL Super 27 34OnePath MasterFund 21 20Telstra Super 21 7C+BUS 18 13ING Direct Superannuation Fund 16 2BT Super for Life 15 14Unisuper Limited 11 14Emergency Services Superannuation Scheme 11 9MLC Masterkey Superannuation 10 4AMP Flexible Lifetime Super 10 16ANZ Smart Choice Super 9 -Others 91 103TOTAL 1,436 1,394


D R A F T


23. GLOSSARY OF TERMS

Cash and cash equivalents

Cash and cash equivalents is petty cash, cash floats, deposits in bank accounts, bank overdrafts and short-term deposits (up to 90 days).

Comprehensive resultTotal comprehensive result is the change in equity for the period other than changes arising from transactions with owners. It is the aggregate of net result and other non-owner changes in equity.

CommitmentsCommitments include those operating, capital and other outsourcing commitments arising from non cancellable contractual or statutory sources.

Delaware North Australia Sinking FundRefers to an account managed jointly by the Trust and the Trust’s caterer (Delaware North Australia) and is used for the replacement or improvement of catering equipment or infrastructure.

Employee benefits expenseEmployee benefits expenses include all costs related to employment including wages and salaries, leave entitlements, redundancy payments, defined benefits superannuation plans, and defined contribution superannuation plans.

Financial assetA financial asset is any asset that is:

(a) Cash and Cash Equivalents;

(b) an equity instrument of another entity;

(c) a contractual or statutory right:

• to receive cash or another financial asset from another entity; or

• to exchange financial assets or financial liabilities with another entity under conditions that are potentially favourable to the entity; or

(d) a contract that will or may be settled in the entity’s own equity instruments and is:

• a non derivative for which the entity is or may be obliged to receive a variable number of the entity’s own equity instruments; or

• a derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments.

Financial instrumentA financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Financial assets or liabilities that are not contractual (such as statutory receivables or payables that arise as a result of statutory requirements imposed by governments) are not financial instruments.

Financial liabilityA financial liability is any liability that is:

(a) A contractual or statutory obligation:

(i) To deliver cash or another financial asset to another entity; or

(ii) To exchange financial assets or financial liabilities with another entity under conditions that are potentially unfavourable to the entity; or

(b) A contract that will or may be settled in the entity’s own equity instruments and is:

(i) A non-derivative for which the entity is or may be obliged to deliver a variable number of the entity’s own equity instruments; or

(ii) A derivative that will or may be settled other than by the exchange of a fixed amount of cash or another financial asset for a fixed number of the entity’s own equity instruments. For this purpose the entity’s own equity instruments do not include instruments that are themselves contracts for the future receipt or delivery of the entity’s own equity instruments.

Financial statementsDepending on the context of the sentence where the term ‘financial statements’ is used, it may include only the main financial statements (i.e. comprehensive operating statement, balance sheet, cash flow statements, and statement of changes in equity); or it may also be used to replace the old term ‘financial report’ under the revised AASB 101 (September 2007), which means it may include the main financial statements and the notes.

GrantsGrants can be paid as general purpose grants which refer to grants that are not subject to conditions regarding their use. Alternatively, they may be paid as specific purpose grants which are paid for a particular purpose and/or have conditions attached regarding their use.

Intangible assetsIntangible assets represent identifiable non monetary assets without physical substance.

Interest expenseCosts incurred in connection with the borrowing of funds interest expenses include interest on bank overdrafts and short term and long term borrowings, amortisation of discounts or premiums relating to borrowings, interest component of finance leases repayments, and the increase in financial liabilities and non employee provisions due to the unwinding of discounts to reflect the passage of time.

Interest incomeInterest income includes interest received on bank term deposits, interest from investments and other interest received.


D R A F T


Net acquisition of non-financial assets (from transactions)Purchases (and other acquisitions) of non financial assets less sales (or disposals) of non financial assets less depreciation plus changes in inventories and other movements in non financial assets. It includes only those increases or decreases in non financial assets resulting from transactions and therefore excludes write offs, impairment write downs and revaluations.

Net resultNet result is a measure of financial performance of the operations for the period. It is the net result of items of income, gains and expenses (including losses) recognised for the period, excluding those that are classified as other non owner changes in equity.

Net result from transactions (net operating balance)Net result from transactions or net operating balance is a key fiscal aggregate and is income from transactions minus expenses from transactions. It is a summary measure of the ongoing sustainability of operations. It excludes gains and losses resulting from changes in price levels and other changes in the volume of assets. It is the component of the change in net worth that is due to transactions.

Non-financial assetsNon financial assets are all assets that are not ‘financial assets’.

Other economic flows included in net resultOther economic flows included in net result are changes in the volume or value of an asset or liability that do not result from transactions. It includes:

• gains and losses from disposals, revaluations and impairments of non-financial physical and intangible assets; and

• gains and losses arising from revaluation of long service liability.

Other economic flows – other comprehensive incomeOther economic flows – other comprehensive income comprises items (including reclassification adjustments) that are not recognised in net result as required or permitted by other Australian Accounting Standards.

The components of other economic flows other comprehensive income include:

• changes in physical asset revaluation surplus.

PayablesIncludes short and long term trade debt and accounts payable, grants, taxes and interest payable.

ReceivablesIncludes amounts owing from government through appropriation receivable, short and long term trade credit and accounts receivable, accrued investment income, grants, taxes and interest receivable.

Sales of goods and servicesRefers to revenue from direct provision of goods and services and includes fees and charges for services rendered and sales of goods and services.

Tennis Australia Special Purpose AccountRefers to a separate account established by MOPT for tennis-related capital improvements to Melbourne Park.

TransactionsTransactions are those economic flows that interact between two entities by mutual agreement.

Style conventionsFigures in the tables and in the text have been rounded. Discrepancies in tables between totals and sums of components reflect rounding. Percentage variations in all tables are based on the underlying unrounded amounts.

The notion used in the tables is as follows:

- zero, or rounded to zero (xxx) negative numbers 20xx year 20xx-xx year period


D R A F T

CERTIFICATION

In accordance with a resolution of the members of the Melbourne and Olympic Parks Trust and in our opinion:

(a) the accompanying financial report of the Trust, comprising operating statement, balance sheet, cash flow statement and statement of changes in equity read in conjunction with the notes thereto present fairly the financial operations of the Trust for the year ended 30 June 2016 and the State of Affairs of the Trust on that date;

(b) these accounts have been prepared in accordance with the Financial Management Act 1994, Australian Accounting Standards and other mandatory professional reporting requirements; and

(c) at the date of this statement we are not aware of any circumstances which would render any particulars included in the statement to be misleading or inaccurate.

Russell Caplan Member of Responsible Body Chairman Melbourne and Olympic Parks Trust

Brian Morris Accountable Officer Chief Executive Officer Melbourne and Olympic Parks Trust

Travis Mardling Chief Financial Officer Melbourne and Olympic Parks Trust


D R A F T

INDEPENDENT AUDIT REPORT


D R A F T

INDEPENDENT AUDIT REPORT


D R A F T

ADMINISTRATIVE REPORTING REQUIREMENTSCompetitive Neutrality Policy ComplianceThe Trust regularly reviews whether its activities are subject to the requirements of the National Competition Policy, including compliance with the requirements of the policy statement ‘Competitive Neutrality Policy Victoria’, and takes necessary action to implement competitive neutrality measures where required.

Statement of Compliance with the Building Act 1993.The Trust complies with the relevant guidelines, pursuant to Section 220 of the Building Act 1993.

Implementation of the Victorian Industry Participation Policy The Victorian Industry Participation Policy Act 2003 requires departments and public sector bodies to report on the implementation of the Victorian Industry Participation Policy (VIPP). Departments and public sector bodies are required to apply VIPP in all procurement activities valued at $3 million or more in metropolitan Melbourne and for statewide projects, or $1 million or more for procurement activities in regional Victoria.

There were two procurements undertaken and completed by the Trust in 2015/16 to which the VIPP applied.

A total of 100% of the contracts were estimated to be of local content and a VIPP plan was not required, as the procurement activity was local in nature.

Government Advertising ExpenditureThere were no advertising campaigns that triggered the disclosure threshold of $100,000 in the 15/16 financial year.

Financial and Other Information Retained by the Accountable OfficerRelevant information detailed in Financial Reporting Direction (FRD) 22D ‘Standard Disclosures in the Report of Operations’ under the Financial Management Act 1994 Section 3 is retained by the Trust’s Accountable Officer and is available on request, subject to the Freedom of Information Act 1982.

Protected Disclosure Act 2012Melbourne & Olympic Parks is committed to the aims and objectives of the Protected Disclosure Act. It recognises the value of transparency and accountability in its administrative and management practices, and supports the making of disclosures that reveal improper conduct. It does not tolerate improper conduct by the organisation, its employees, officers or members, nor the taking of detrimental action in reprisal against those who come forward to disclose such conduct. According to the Independent Broad-based Anti-corruption Commission (“IBAC”), M&OP is not permitted to receive disclosures made under the Act. Therefore, if you wish to make a disclosure about M&OP, its officers, members or employees, you will need to make that disclosure directly to the IBAC. If M&OP believes a disclosure may be a protected disclosure made in accordance with the Act, it will ask you to make that disclosure to the IBAC. The IBAC will deal with the

disclosure. Procedures in relation to the Protected Disclosure Act 2012 are available on the M&OP website.

Disability Act (2006)M&OP is committed to providing equitable, dignified access to goods and services to premises used by the public. A key focus of the $700 million redevelopment of Melbourne Park has been the inclusion of universal design principles. This proactive work ensures the design of new buildings or upgraded infrastructure are centred around improved access for all Victorians.

Throughout the course of this financial year, M&OP continued to implement its Diversity and Inclusion Plan, setting short, medium and long term goals to improve the guest experience for people with a disability. A copy of the plan is available at www.mopt.com.au

Occupational Health and Safety (OH&S)M&OP is committed to provide and maintain an environment that is safe for all who visit and work within the precinct or who may be affected by our business operations. M&OP aspires to eliminate risks to health and safety, and where elimination is not reasonably achievable, to reduce risks to health and safety so far as is reasonably practicable.

This will be achieved by:

• Promoting a strong safety culture and integrating safety into all aspects of M&OP’s activities.

• Setting measurable objectives and targets aimed at controlling risk activities and increasing awareness of health and safety and preventing injuries and illnesses.

• Providing sufficient resources to plan and maintain a safe, healthy and supportive work environment.

• Maintaining physical infrastructure and public spaces, in a condition that ensures it is safe to use.

To support this commitment, M&OP continues to maintain AS4801 accreditation for Safety Management Systems (AS4801). This achievement is underpinned by M&OP’s leadership driven safety culture, which encourages collaboration, consultation and ownership to occur at all organisational levels. M&OP’s commitment to continuous improvement is reflected in our Health and Safety Policy, which highlights the accountabilities shared across our workforce.

Key achievements for the year included:

• 120 monthly workplace inspections covering all designated workgroup areas across the precinct.

• 72 designated work group toolbox meetings and 12 Health and Safety Committee meetings held.

• A 59 percent improvement in the number of injuries sustained across the precinct compared to 14/15 results, which includes an 83 per cent reduction in event guest injuries.

• Completion of an organisational-wide training program targeted at incident, hazard and injury management.

• 18 internal health and safety audits conducted.

A full copy of the Trust’s Health and Safety policy is available on M&OP’s website – www.mopt.com.au


D R A F T

ADMINISTRATIVE REPORTING REQUIREMENTSEmployee Assistance ProgramM&OP Employee Assistance Program (EAP) continued to provide employees and their immediate family members with access to free, confidential counselling to help address work and personal issues.

Statement of Workforce DataMelbourne and Olympic Park Trust is committed to two codes issued by the Public Sector Standards Commissioner (PSSC), being the Director Codes of Conduct and Guidance Notes and the Code of Conduct of Victorian Public Sector employees.

Enterprise Based Agreements are in place and the Trust continues its ongoing commitment to the PSSC standards on equal opportunity, fair and reasonable treatment, merit in employment and reasonable avenues of redress.

Melbourne & Olympic Parks Trust employed 109 full time and part time staff as at 30 June 2016 (2015:106). The number of Full Time Equivalent (FTE) staff at 30 June 2016 was 96.8 (2015: 100). The number of fixed term and casual employees at 30 June 2016 was 595 (2015:706) and a large number of contractors provided by our key partners also contribute to M&OP’s workforce (TechGuard Security, Capricorn Stages and Rigging, Delaware North Companies, O’Brien Catering Group Australia and Ticketek).

The breakdown of staff is as follows:

Employees (Headcount)

Full time (Headcount)

Part time (Headcount)

FTEFixed Term & Casual

Employees

June 2016 109 93 16 97 595

June 2015 106 88 18 100 706

June 2016 June 2015

Employees (Headcount)


Employees

Employee (Headcount)


Employees

Accountable Officer 1 1 1 1 1 1

Executive Officers 6 6 6 6 6 6

Administration Staff 102 98 589 99 93 699

Males 63 63 309 64 63 360

Females 46 42 287 42 37 346

Freedom of information The Freedom of Information Act 1982 allows the public a right of access to documents held by Melbourne and Olympic Parks Trust. For the 12 months ending June 2016, the Trust received two FOI requests.

The Chief Financial Officer is the contact officer in relation to all Freedom of Information requests. Access to documents may be obtained through written request to the Chief Financial Officer, addressed as follows:

Freedom of Information Melbourne and Olympic Parks Trust GPO Box 4611, Melbourne VIC 3001 Requests can also be lodged via email to [email protected].

All requests must be accompanied by the application fee ($27.90 from 1 July 2016 but may be waived in certain circumstances) and must provide such information concerning the document as is reasonably necessary to enable M&OP to identify the document. Charges may also apply once documents have been processed and a decision on access is made; for example photocopying and search and retrieval charges.


D R A F T

Consultants

Details of consultancies over $10,000

Consultant Purpose of consultancy Start date End date Total expenditure 2015/16 (excluding GST)

Future commitments

Norman Disney & Young

MOPT technology strategy development December 2015

Ongoing $37,625 nil

Bespoke Approach Pty Ltd

Strategic communications advice November 2015

November 2015

$30,000 nil

Arup Pty Ltd AAMI Park themed lighting design July 2015 October 2015

$10,530 nil

Details of consultancies less than $10,000 Number: 2 Total Amount: $14,700

Disclosure of ICT ExpenditureFor the 2015−16 reporting period, the Trust had a total ICT expenditure of $4,377,000 with the details shown below.

($ thousand)

Business As Usual (BAU) ICT expenditure

Non-Business As Usual (non BAU) ICT expenditure

Operational expenditure Capital expenditure

(Total) (Total = Operational expenditure and Capital Expenditure)

1,447 2,930 193 2,737

ICT expenditure refers to the Trust’s costs in providing business enabling ICT services. It comprises Business As Usual (BAU) ICT expenditure and Non Business As Usual (Non BAU) ICT expenditure. Non BAU ICT expenditure relates to extending or enhancing the Trust’s current ICT capabilities. BAU ICT expenditure is all remaining ICT expenditure which primarily relates to ongoing activities to operate and maintain the current ICT capability.

Gosch’s PaddockGosch’s Paddock remained open at all times throughout the 2015/16 year.

Risk Attestation Statement

I, Chair of the Trust certify that Melbourne and Olympic Parks Trust has complied with the Ministerial Standing Direction 4.5.5 – Risk Management Framework and Processes. The Melbourne and Olympic Parks Trust Finance, Audit and Risk Committee verifies this.

Russell Caplan Chairman Melbourne and Olympic Parks Trust

ADMINISTRATIVE REPORTING REQUIREMENTS


D R A F T

DISCLOSURE INDEX

Ministerial Directions

Charter and PurposeFRD 22G Manner of establishment and the

relevant Minister 4

FRD 22G Objectives, functions, powers and duties

4

FRD 22D Nature and range of services provided

4

Management and structureFRD 22D Organisational Structure 5

Financial and other informationFRD 10 46FRD 12A Disclosure of major contractsFRD 15C Executive officer disclosures 36FRD 22G Significant changes in financial

position during the year FRD 22G Employment and conduct principlesFRD 22G Application and operation of

Freedom of Information Act 1982 44

FRD 22G Application and operation of the Protected Disclosure Act 2012

43

FRD 22G Compliance with building and maintenance provision of Building Act 1993

43

FRD 22G Details of consultancies over $10,000 45FRD 22G Details of consultancies under

$10,000 45

FRD 22G Major changes or factors affecting performance

12

FRD 22G Occupational Health and Safety 44FRD 22G Disclosure of government

advertising expenditureFRD 22G Disclosure of ICT expenditureSD 4.5.5 Risk Management Compliance 45FRD 22G Statement of availability of other

information 43

FRD 22G Statement on Competitive Neutrality Policy

43

FRD 22G Summary of financial results for the year

12

FRD 22G Summary of major activities 9-OctFRD 22G Subsequent events N/AFRD 24C Reporting of office-based

environmental impactsFRD 25A Victorian Industry Participation

Policy disclosures 43

FRD 29 44SD 4.2 (g) Significant information requirementsS 4.2 (j)

Financial Statements required under Part 7 of the FMASD 4.2 (a) Financial Statements 13-42SD 4.2 (b) Balance Sheet 15SD 4.2 (b) Cash flow Statement 17SD 4.2 (b) Comprehensive Operating Statement 14SD 4.2 (b) Statement of Changes in Equity 16

Other requirements under Standing Directions 4.2SD 4.2 (c) Compliance with Australian

accounting standards and other authoritative pronouncements

SD 4.2 (c) Compliance with Ministerial Directions

40

SD 4.2 (d) Rounding of amounts 21SD 4.2 (c) Accountable officer’s declaration 39SD 4.2 (f) Compliance with Model Financial

Report

Other disclosures in notes to the financial statementsFRD 9A Departmental disclosure of

administered assets and liabilities FRD 11 N/AFRD 13 N/AFRD 21B Responsible person and executive

officer disclosures FRD 103F Non-Financial Physical Assets FRD 112D Defined Benefit Superannuation

Obligations

LegislationAudit Act 1994Building Act 1993Crown Land (Reserves) Act 1978Disability Act 2006Financial Management Act 1994 (including Standing Directions)Freedom of Information Act 1982Melbourne and Olympic Parks Act 1985 (amended)Occupational Health and Safety Act 2004Protected Disclosure Act 2012Public Administration Act 2004Victorian Industry Participation Policy Act 2003Victorian Managed Insurance Authority Act 1996

The Annual Report of Melbourne and Olympic Parks Trust is prepared in accordance with all Victorian Legislation.This index has been prepared to facilitate identification of compliance with statutory disclosure requirements.

PLEASE WAIT UNTIL FINAL DRAFT BEFORE REVISITING THESE NUMBERS


D R A F T


This report has been printed on 100% post consumer recycled stock.

© State of Victoria, Melbourne & Olympic Parks Trust 2016.

This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968.

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