AMNESTY INTERNATIONAL AUSTRALIA ABN 64 002 806 233
ANNUAL FINANCIAL REPORT 2008
Directors’ Report 2008 The Directors present their report together with the financial report of Amnesty International Australia (AIA) (“the company”), a company limited by guarantee, for the year ended 31 December 2008 and the auditor’s report thereon.
Directors The Directors, at any time during or since the end of the financial year are: Name and Qualifications
Age
Nicole Bieske, LLB (Hons), BA
35
Sessional lecturer, Monash University Qualified Solicitor Member of Amnesty International since 1998 Member of Victorian Branch Committee for 4 years (Secretary), member of National Legal Team and co-convenor of Victorian Legal Group Delegate, International Council Meeting 2007
58
Self employed Consultant Member of Amnesty International since 2004 Member, WA Branch Committee 2005-2006 Member Governance Committee and Diversity Steering Committee. Convenor Planning Committee. Convenor NAGM Organising Committee since 27/9/08. Member Audit & Risk Committee until 27/9/08. Member National Refugee Team. Convenor WA Refugee Team and WA Human Rights Book Reading Group
Director and National President Director since 3/9/04 President since 6/7/08 Vice President from 2/7/06 – 5/7/08 James Sharp, LLB Director and National Vice President Director since 2/7/06 Vice President since 6/7/08
Dawna Wright, B.Comm (Hons)
38
Director and National Treasurer
Experience and Special Responsibilities
McGrathNicol, Partner Chartered Accountant (Canada & Australia), Certified Public Accountant (USA), Certified Fraud Examiner (USA) Member of Amnesty International Australia since 2006
Director since 9/3/07 Acting Treasurer 9/3/07 – 6/7/07 Treasurer since 6/7/07 Chair of Audit and Risk Committee since 9/3/07 Michael Gordon Butler, BA (Social Work) Director and Company Secretary
54
Director Industrial Relations, Association of Professional Engineers, Scientists & Managers, Australia Member of Amnesty International since 2000 Member of VIC Branch Committee since 2002 Secretary of VIC Branch Committee 2005-2006 President of VIC Branch Committee 2006-2008
Director since 20/5/06 Company Secretary since 6/7/08
Amnesty International Australia, Annual Financial Report 2008
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Directors’ Report 2008 Name and Qualifications Georgina Perry, LLB (Hons), BA
Age 31
Solicitor, Allens Arthur Robinson Member of Amnesty International since 1992 NSW Branch President 2002 – 2004 National Vice-President 2004 - July 2006 National President from July 2006 to 2008 Delegate, International Council Meeting 2007
51
Manager, Learning & Assessment Design, Future SACE Office/SACE Board of South Australia Member of Amnesty International since 1994 SA/NT Branch Committee member since 2005 SA/NT Branch President since October 2006 – May 2008
27
Governance and Anti-Corruption Policy Officer, The Australian Agency for International Development. Member of Amnesty International since 2005
55
Deputy Director, Centre for Water Research based at The University of Western Australia. Member of Amnesty International Australia since 1995. WA Branch Vice President (1999,2001,2002) WA Branch Secretary (1997,1998) WA Women’s Group Convenor 2002-2006 WA Branch President since May 2007
54
Program Director and Senior Lecturer, Legal and Dispute Studies, RMIT University Admitted to practice as Barrister and Solicitor, Victoria and Western Australia Member of AIA since 1985 Member of Vic Branch Committee since 2005 Vice President of Vic Branch Committee 2006-2008 President Vic Branch Committee since July 2008
28
Research Officer, Centrecare Tasmania Resource Officer, Tasmanian Catholic Justice and Peace Commission Tasmanian Branch Committee member since 2006 Tasmanian Branch President since May 2008
Director Director 16/3/02 – 21/7/04 Director since 3/9/04 Ordinary board member from July 2008 Catherine Cooper M Ed, BA, Grad Dip Ed
Experience and Special Responsibilities
Director Director since 31/10/06 – 10/5/08 Director since 06/7/08 Sheena Graham BA (Political Science and International Relations) Director Director since 06/7/08 Caroline Wood Director Director since 5/5/07
Russell Solomon BA(Hons), B.Juris, LLB, MA, PhD Director Director since 20/7/08
Perdita Sonntag Director Director since 26/8/08
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Directors’ Report 2008 Name and Qualifications Anthony Mitchell BA (Pure Mathematics) BSc (Psychology)
Age 39
Director
Experience and Special Responsibilities Director, Bendelta P/L (strategic advisory firm) New South Wales Branch President since 17 May 2008 New South Wales Branch Vice President May 2007 – May 2008 New South Wales Branch Committee member since May 2006
Director since 17/5/08 Maree Klemm BSc (Hons) GAICD FAusImm F Fin
54
Consultant, resources and financial services sector Amnesty International Australia member since 2004 Queensland/Northern New South Wales President since May 2008
Director Director since 10/5/08 Toni Matulick BA LLB (Hons), Grad Dip Ed, GDLP
38
Employed by the Department of the Senate Member of Amnesty International Australia and ACT/Southern NSW Branch Committee since 2004 Branch President ACT/Southern NSW since May 2008
57
Practising General Medical Practitioner Member of Amnesty International Australia since 1997 Convenor of an Amnesty International Australia local group since 2002 Member of South Australia/Northern Territory Branch Committee 2006-2009 Vice President, SA/NT Branch Committee 2008 Branch President, SA/NT since December 2008
26
Law student
40
Board Member, Disability Information and Resource Centre until December 2008 More than 20 years experience with Amnesty International in Australia and New Zealand Amnesty International Australia Director 2004-2006 Member South Australia/Northern Territory Branch Committee Branch President South Australia/Northern Territory May 2008 – December 2008
Director Director since 13/5/08 Denise Skiffington MBBS Director Director since 12/12/08
Sarah Holloway Director Director since 3/5/08 26/8/08 Tracy Crisp MA DevStudies (Hons) BA, GradDip Director Director since 6/7/08 – 12/12/08
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Directors’ Report 2008 Name and Qualifications Dr Gregory Luckman, PhD, M AgrSc, B AgrSc, Grad Dip Bus
Age
Experience and Special Responsibilities
51
Registrar, Physiotherapists Registration Board of Tasmania Member of Amnesty International Australia for 23 years; Tasmanian Branch Committee (President for 6 years). Delegate, International Council Meeting 2001, 2003
56
Manager, Aboriginal Programmes, Central TAFE, Perth, WA
35
Solicitor, Victoria Legal Aid Member of Amnesty International for 10 years Member of Victorian Branch Committee for 7 years. President, Victorian Branch 2004 - 2006 Delegate, International Council Meeting 2005 and 2007 Convenor, National Refugee Team 2003 - 2005
57
Learning Adviser, James Cook University Member of Amnesty International since 1993 Convenor of Townsville group for 11 years President, Queensland Branch since 21 May 2005
50
International Relations Policy Officer University of Technology, Sydney New South Wales Branch Committee since 2003 Candle Day Coordinator 2001/2 President, New South Wales Branch 15/12/04 - 17/5/08
30
Solicitor, Clayton Utz Member of Amnesty International for 8 years. Member of Australian Capital Territory and Southern NSW Branch Committee for 3 years President, Australian Capital Territory/Southern New South Wales Branch from 12 May 2007 – 13 May 2008
Director and Company Secretary Director 17/5/91 – 30/5/92 Director from 14/3/98 to 6/07/08 Treasurer 26/5/00 - 3/9/04 Company Secretary from 3/09/04 – 6/7/08 Helen Patricia Corbett, BA (Hons)(Sociology) Director Director between 8/1/08 – 6/7/08 Stuart Webb, M Pub Int Law, LLB (Hons), BA Director Director from 8/5/04 – 6/7/08
Peter Hanley, BE, MEngSc, DipEd, MEd Director between 21/5/0510/5/08
Debra Johnson Director Director between 15/12/04 – 17/5/08 Alice Linacre, LLB, BA Director Director from 12/5/07 – 13/5/08 Director 18/9/04 – 24/03/06
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Directors’ Report 2008 Name and Qualifications Clare Michele Wiseman, LLB (Hons), BA Director Director from 15/9/06 – 3/5/08
Age 34
Experience and Special Responsibilities Senior Policy Analyst, Department of Premier and Cabinet, Tasmania Member of Amnesty International since 2001 Member of NSW Branch Committee March 2002 - October 2004 Member of TAS Branch Committee since November 2004 May 2008 Member of National Legal Team and convenor of NSW Legal Network Aug 2000 – July 2003 President Tasmanian branch from 15 September 2006 - 3 May 2008
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Directors’ Report 2008 Directors’ Attendance at Board Meetings – 2008
Director
Board Meetings Eligible to attend
Attended
Nicole Bieske
8
8
James Sharp
8
8
Dawna Wright
8
5
Michael Butler
8
7
Georgina Perry
8
7
Catherine Cooper
6
6
Sheena Graham
2
2
Caroline Wood
8
6
Russell Solomon
2
2
Perdita Sonntag
2
2
Anthony Mitchell
4
4
Maree Klemm
4
4
Toni Matulick
4
3
Denise Skiffington
1
1
Sarah Holloway
2
2
Tracy Crisp
4
4
Gregory Luckman
6
5
Helen Patricia Corbett
5
3
Stuart Webb
6
6
Peter Hanley
4
3
Debra Johnson
4
4
Alice Linacre
4
4
Clare Wiseman
4
4
Amnesty International Australia, Annual Financial Report 2008
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Directors’ Report 2008 Principal Activities The principal activities of the company during the course of the financial year were human rights campaigning, awareness raising and fundraising. There have been no significant changes in the nature of these activities during the year. Result The operating deficit for 2008 amounted to $1,391,136 (2007: surplus $223,544). The deficit is the result of two main factors. Firstly, Amnesty International Australia planned to run a deficit in order to utilise accumulated surpluses from previous years. Secondly, there were significant unrealised losses on managed investment funds. Review of Operations Amnesty International is a global movement of more than 2.2 million people in 150 countries, committed to defending those who are denied justice or freedom. Amnesty International Australia and our 80,000 supporters raise awareness about human rights issues, mobilise activism, campaign on key issues, conduct research and education and raise money for our work. In 2008, Amnesty International Australia's work was guided by the organisation's global strategic plan for 2004–2010. Our section contributed 22 per cent of its annual income directly to the global movement. This financial contribution enhances Amnesty International’s human rights impact, assists with organisational development and contributes to growth strategies. One key project funded from Australia’s contribution was the Amnesty International Youth Forum in Hong Kong. We also contributed information, materials, training, development and advice to the global movement. Our key campaign in 2008 focused on human rights in China. In the lead-up to the Beijing Olympics, we called for an end to internet censorship and greater freedom of expression in China. Our replica ‘firewall’ toured 35 towns and cities throughout Australia, encouraging more than 16,000 people to take action in support of the campaign. Our campaign generated 500 Australian press articles focusing on human rights concerns in China. These were viewed by an estimated 500,000 people. Our campaign microsite www.uncensor.com.au highlighted censorship in China and was visited by more than 48,500 people in 149 countries. In addition to raising awareness about human rights concerns in China, the campaign successfully contributed to human rights outcomes, including the early release of imprisoned human rights defenders. Amnesty International Australia took action for Bu Dongwei, who spent four months in a ‘re-education through labour’ camp, and Mao Hengfeng, a women's reproductive rights campaigner, who was released on 29 November. Our campaign also saw people in China gain more access to online information from sources such as the Amnesty International and BBC websites and many others. Our campaign for the rights of refugees and asylum seekers was also very successful. The closure of the offshore detention centre on Nauru marked the end of the ‘Pacific solution’ and the Australian Government abolished Temporary Protections Visas. We also gained a commitment from the government to end indefinite detention, which has seen people imprisoned for up to nine years. Our work on Individuals at Risk was strengthened with the establishment of a dedicated staff position in this area and a new strategy that was developed to better enable Australians to support individuals suffering human rights violations.
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Directors’ Report 2008 2008 saw the release of a number of individuals on whose behalf Amnesty International Australia had worked, including housing rights activist Ye Guozhu, a key case in our China campaign, who was released in October. Irene Fernandez, a migrants' rights activist, was acquitted by a Malaysian High Court in November after more than 12 years of legal battles. The decision ended one of the longestrunning court cases in Malaysian legal history. U Win Tin, a prominent Myanmar journalist and activist, was released in September along with six other prisoners of conscience. He was imprisoned for 19 years and was one of the longest-serving prisoners of conscience in the country. Our Counter Terror with Justice campaign saw thousands of supporters across Australia, 300 of them at th a Sydney protest alone, calling for the closure of the detention centre at Guantánamo Bay on the 6 anniversary of prisoners arriving there. Our replica Guantánamo cell toured the US ahead of the Presidential election to support calls to close the centre. On 17 November then Presidential nominee, Barack Obama, announced his intention to close the Guantánamo Bay facility if elected. On 22 January 2009, President Obama issued several executive orders designed to close Guantanamo Bay, end secret detention and bring the US’s detention and interrogation policies in the context of the ‘war on terror’ in line with human rights standards. There were also some major outcomes in our Stop Violence against Women campaign, with the establishment of a National Council to develop a National Plan of Action to eliminate violence against women and their children. Amnesty International Australia produced a groundbreaking report Setting the Standard: International Good Practice to inform a National Plan of Action to Stop Violence Against Women which the Council used as a framework for their plan. In November 2008 we presented Minister for the Status of Women, Tanya Plibersek, with a petition containing 30,000 signatures supporting calls for a properly resourced National Plan of Action. In 2008 we began research and consultation for our upcoming Demand Dignity campaign, which will focus on Indigenous human rights and poverty. We appointed a Demand Dignity campaign coordinator and researcher to work with our Indigenous rights campaigner. This team made three visits to the Northern Territory to consult with communities impacted by the government’s intervention. Building on our consultation, research and relationship-building phase, Amnesty International Australia will launch its Demand Dignity campaign on Indigenous human rights in October 2009. Our organisation joined the Close the Gap campaign in 2008 and activists around Australia participated in events to highlight the 17 year disparity in life expectancy between Indigenous and non-Indigenous Australians. We made a submission to the Federal Government’s Northern Territory Review Board calling for reinstatement of the Racial Discrimination Act (RDA). The government has subsequently announced that it will reinstate the RDA. th
2008 marked the 60 anniversary of the signing of the Universal Declaration of Human Rights. Amnesty International Australia celebrated at events across the country around Human Rights Day on 10 December. We partnered with The Body Shop to promote human rights throughout its stores during the month of December. On the anniversary of the Universal Declaration of Human Rights the government announced a consultation with Australian citizens about human rights protection. We welcomed the government’s consultation and began work on a campaign calling for it to create a Human Rights Act. Despite building economic pressures in Australia, our supporter numbers remained steady in 2008, with 78,786 financial supporters at the end of the year. The number of our regular monthly financial supporters, Human Rights Defenders, reached 47,986, contributing more than $1.2 million per month. Supporters making gifts in their will were again an important part of our funding and in 2008 we received bequests totaling $379,442.
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Directors’ Report 2008 Our first Student Action Packs were developed and sent quarterly to 600 schools across Australia. They provide campaign information and youth-based actions, and improve our communication with school groups as well as adding to the human rights impact of our young supporters. We continued work on developing curriculum resources for secondary students – including our first Indigenous rights teaching resource. We also made a number of submissions to government relating to human rights in school curricula and built relationships with academics to promote a focus on human rights and Indigenous culture in teacher education. In 2008 we undertook a comprehensive planning process to set our vision for the Amnesty International Australia movement between 2009–2014, conducting extensive supporter and staff consultations. The vision, our human rights impact areas and other key projects aim to strengthen, grow our organisation and to inspire positive human rights changes for the next five years. By 2014 Amnesty International Australia will be: • • • •
Inspiring 500,000 people every year to take action. Positively influencing and informing key opinion formers and decision makers. An inclusive, authoritative, relevant and bold organisation. Playing a leading role in Amnesty International, particularly in the Asia Pacific region.
The first phase of our Supporter Information Management System (SuMS) went ‘live’ in November, with all supporter information housed within the new system and the processing of most financial transactions now managed through SuMS. The SuMS project will enhance the long-term sustainability of the movement and strengthen communication with supporters. Additional functionality will be introduced in 2009. State of Affairs There were no significant changes to the state of affairs of the company during 2008. Events Subsequent to Balance Date In the interval between the end of the financial year and the date of this report, there has not been any transaction or event of a material and unusual nature likely, in the opinion of the directors of the company, to affect significantly the operations of the company, the results of those operations, or the state of affairs of the company in future financial years. Likely Developments and Expected Results In 2009, Amnesty International Australia will: • • • • • •
Demand Dignity for Indigenous Australians. Campaign for an effective National Plan to Stop Violence Against Women. Increase our support for the global movement. Respond rapidly to international crises and individuals at risk. Campaign for the closure of the Christmas Island detention centre. Campaign for a Human Rights Act that protects all our rights.
The governance committee, a sub-committee of our Board, has established a working group to consult membership, supporters and partners about how Amnesty International Australia can strengthen its democracy. The project will be a key focus for the organisation in 2009.
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Directors’ Report 2008 In May 2009, Amnesty International Australia will join the global movement in launching the Demand Dignity campaign, linking poverty to human rights violations. We will begin raising awareness and campaigning on the issues of maternal mortality, housing (slums and forced evictions) and access to education. The domestic focus of our Demand Dignity campaign, Indigenous human rights, will launch in October. The organisation is committed to developing a Reconciliation Action Plan to help continue building positive relationships between Indigenous and non-Indigenous people. This Plan will form part of our contribution towards the national effort to close the 17-year life expectancy gap between Indigenous and non-Indigenous Australians. Amnesty International Australia is working in partnership with more than 50 other organisations to call on the Australian Government to implement a Human Rights Act that ensures protection of civil and political as well as economic, social and cultural rights. Environmental Regulations The company is not subject to any significant environmental regulations under either Commonwealth or State regulation. Indemnification and Insurance of Directors and Officers Indemnification In 2002 Amnesty International Australia entered into a Deed of Indemnity and Access with each of the members of the National Executive Committee (NEC) - which is the Board of Amnesty International Australia - in accordance with rule 11 of the Company's Constitution and section 198F of the Corporations Act 2001. These indemnities remain in place for those members of the NEC in place since 2002. Subsequent Deeds of Indemnity and Access have been entered into as required with the appointment of new members to the NEC. In 2003 Amnesty International Australia entered into a Deed of Indemnity and Access with the National Director. A subsequent Deed of Indemnity and Access has been entered into with the appointment of a new National Director. Other than those above, since the end of the previous financial year, the company has not indemnified or made a relevant agreement for indemnifying against a liability any person who is or has been an officer or director of the company. Insurance Premiums During the financial year the company has paid premiums of $5,335 on behalf of the company in respect of Directors’ and Officers’ liability and legal expenses insurance contracts for the year ended 31 December 2008. The company has also paid or agreed to pay, premiums in respect of such insurance contracts for the year ended 31 December 2009. Such insurance contracts insure against liabilities (subject to certain exclusions) persons who are or have been Directors or Officers of the company. Directors have not included details of the nature of the liabilities covered or the amount of the premium paid as such disclosure is prohibited under the terms of the contract. Directorships of Public Companies Stuart Webb is a director of the Law Institute of Victoria. Dawna Wright is a director of Women's Circus Ltd, since 23 February, 2009. No other Amnesty International Australia director holds directorships of any other public companies.
Amnesty International Australia, Annual Financial Report 2008
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Financial Statements for the Year Ended 31 December 2008 Income Statement for the Year Ended 31 December 2008
Note
2008 $
2007 $
14,300,522 1,252,521 1,540,179 378,409
13,458,632 1,590,096 1,379,254 403,419
379,442 620,008 375,047
694,914 721,146 383,315
226,167 18,379
237,512 163,837
19,090,674
19,032,125
(7,080,361) (4,225,582) (4,176,243) (2,673,052) (371,293) (639,050) (913,996) (402,233)
(6,881,941) (3,509,040) (4,284,390) (2,196,155) (361,476) (679,493) (736,454) (159,632)
(20,481,810)
(18,808,581)
Revenue from operating activities Donations/fundraising Human rights defender pledges Mail appeals Other donations Fundraising events Bequests Membership fees Merchandising Other revenue Interest and other Distributions from financial asset at fair value Total revenue Expenditure on Operating Activities Human rights campaigning in Australia International campaigning and research Building our supporter base Fundraising Merchandise Governance and democracy Administration and other Unrealised loss on financial asset at fair value Total expenses Operating (Deficit)/Surplus
2
(1,391,136)
223,544
The income statement is to be read in conjunction with the notes to the financial report set out on pages 17 to 38.
Amnesty International Australia, Annual Financial Report 2008
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Financial Statements for the Year Ended 31 December 2008 Balance Sheet as at 31 December 2008 2008 $
2007 $
3 4 6 5 9 9
4,040,393 496,802 95,382 298,751 1,067,643 5,998,971
4,409,918 473,850 81,816 342,673 81,358 1,451,497 6,841,112
7 8
1,703,760 165,371 1,869,131
2,107,223 2,107,223
7,868,102
8,948,335
10 12
1,090,348 433,124 1,523,472
890,081 _399,858 1,289,939
10 13
221,786 148,839 370,625
217,151 76,104 293,255
Total liabilities
1,894,097
1,583,194
Net assets
5,974,005
7,365,141
Accumulated Surplus Retained surplus
5,974,005
7,365,141
Accumulated Surplus
5,974,005
7,365,141
Note Assets Current Assets Cash and cash equivalents Trade and other receivables Inventories Other current assets Available for sale financial asset Financial assets at fair value through profit or loss Total Current Assets Non-Current Assets Property, plant and equipment Intangible assets Total Non-Current Assets Total assets Liabilities Current Liabilities Trade and other payables Provisions Total Current Liabilities Non-Current Liabilities Other payables Provisions Total Non-Current Liabilities
The balance sheet is to be read in conjunction with the notes to the financial report set out on pages 17 to 38.
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Financial Statements for the Year Ended 31 December 2008 Cash Flow Statement for the Year Ended 31 December 2008
Cash Flows from Operating Activities
2007 $
18,845,229 226,167
18,330,126 241,717
(4,238,209) (14,715,548)
(3,454,130) (14,226,938)
Note
Cash receipts in the course of operations Interest received Payments to the International Secretariat and other Amnesty International sections Payments to employees and suppliers Net Cash Flows provided by Operating Activities
2008 $
3b
117,639
890,775
Cash Flows from Investing Activities Distributions from financial asset at fair value through profit or loss Purchase of financial asset at fair value through profit or loss Purchase of property, plant and equipment Purchase of intangible asset
18,379
-
(18,379) (289,194) (197,970)
(1,451,497) (1,837,476) -
Net Cash Flows Used in Investing Activities
(487,164)
(3,288,973)
Net (decrease)/increase in cash held Cash at the beginning of the financial year Cash at the end of the financial year
3a
(369,525)
(2,398,198)
4,409,918
6,808,116
4,040,393
4,409,918
The cash flow statement is to be read in conjunction with the notes to the financial report as set out in pages 17 to 38.
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Financial Statements for the Year Ended 31 December 2008 Statement of Changes of Equity for Year Ended 31 December 2008
Accumulated surplus $
Total
At 1 January 2007 Profit for year
7,141,597 223,544
7,141,597 223,544
At 31 December 2007
7,365,141
7,365,141
7,365,141 (1,391,136)
7,365,141 (1,391,136)
5,974,005
5,974,005
At 1 January 2008 Deficit for the period At 31 December 2008
$
The statement of changes in equity is to be read in conjunction with the notes to the financial report as set out in pages 17 to 38.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES The following significant accounting policies adopted in the preparation of the financial report are: a.
Basis of preparation
The financial report is a general purpose financial report which has been prepared in accordance with Accounting Standards, Urgent Issues Group Consensus Views, other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001. It has been prepared on the basis of historical costs, except for available-for-sale investments and financial assets at fair value through the profit and loss that have been measured at fair value. The accounting policies have been consistently applied, unless otherwise stated. The financial report is presented in Australian dollars, unless otherwise stated. The words ‘operating surplus’ have been substituted for the term ‘profit’ in the prescribed income statement. b.
Statement of compliance
The financial report complies with Australian Accounting Standards, which include Australian equivalents to International Financial Reporting Standards (AIFRS). New Accounting Standards and UIG Interpretations Australian Accounting Standards and UIG Interpretations have been recently issued or amended but are not yet effective. These other standards have not been adopted for the year ended 31 December 2008. The directors have yet to finalise their assessment of the impact of these new standards and interpretation. c.
Income tax
Amnesty International Australia (AIA) is exempt from income tax in Australia under Division 50 of the Income Tax Assessment Act 1997. As specified by the Australian Taxation Office (ATO), AIA completes an annual self-assessment to confirm the exemption. d.
Revenue recognition
Fundraising, bequests, donations and membership fees Contributions from individuals, local groups and networks of Amnesty International Australia are treated as fundraising revenue and are recognised when received. Sale of merchandise and publications Revenue is recognised when the significant risks and rewards of ownership have passed to the buyer and can be measured reliably. Risks and rewards are considered passed to the buyer at the time of delivery of the goods to the customer. Interest revenue Interest revenue is recognised as it accrues, taking into account the effective yield on the financial asset. Distributions from financial asset at fair value Distributions from the financial asset at fair value through the profit and loss are recognised when received. Currently, it is AIA’s policy to reinvest all distributions.
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) e.
Cash and cash equivalents
For the purposes of the statement of cash flows, cash includes cash on hand, at-call or short term deposits with a maturity date of three months or less, and are with banks or financial institutions and also those funds held within Amnesty International Australia Groups bank accounts. f.
Trade and other receivables
Trade receivables are recognised initially at fair value, and subsequently measured less an allowance for uncollectible amounts. The collectability of debts is assessed at the balance sheet date and specific provision is made for any doubtful accounts. g.
Inventories
Inventories are carried at the lower of cost and net realisable value. Costs incurred in bringing each product to its present location and condition are accounted for as follows: Finished goods – cost of direct materials, on a weighted average basis. Net realisable value is the estimated selling price in the normal course of operations, less estimated costs necessary to make the sale. h.
Property, plant and equipment
Plant and equipment is stated at cost less accumulated depreciation and any impairment in value. Assets are depreciated over their estimated useful lives, using the straight line method, from the date of acquisition.
Depreciation rates used for each class of asset, for the current and previous years, are as follows:
IT equipment Plant and equipment Leasehold improvements
2008
2007
33.3% 25% term of lease
33.3% 25% term of lease
Impairment The carrying values of plant and equipment are reviewed for impairment when events or changes in circumstances indicate the carrying value may not be recoverable. If any such indication exists and where the carrying values exceed the estimated recoverable amount, the assets or cash-generating units are written down to their recoverable amount. The recoverable amount of plant and equipment is the greater of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using the rates attaching to national government securities at the balance sheet date, which most closely match the expected remaining useful life of the related asset. Impairment losses are recognised in the income statement.
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) h.
Property, plant and equipment (continued)
Derecognition An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected to arise from the continued use of the asset. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the item) is included in the income statement in the year the item is derecognised. i.
Intangibles
Intangible assets were acquired separately and initially measured at cost. Following initial recognition intangible assets are carried at cost less any accumulated amortisation and any accumulated impairment losses. Intangible assets with finite lives are amortised over the useful life of 5 years and the amortisation expense is recognised in the income statement in the expense category consistent with the function of the intangible asset. j.
Recoverable amounts of assets
At each reporting date, assets are reviewed to determine whether there is any indication that an asset may be impaired. Where an indicator of impairment exists, a formal estimate of the recoverable amount is made, and where the carrying amount of an asset exceeds its recoverable amount the asset is considered impaired and is written down to its recoverable amount. Recoverable amounts are determined for individual assets, unless the value in use cannot be estimated independently from other assets. In this case, the recoverable amount is determined for the cashgenerating group of assets to which it belongs. k.
Leases
Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged on a straight line basis as expenses over the lease term. Operating lease incentives are recognised as a liability when received and subsequently released over the term of the lease to the income statement. l.
Trade and other payables
Trade and other payables are carried at amortised cost, and are recognised for amounts to be paid in the future for goods or services received, whether or not billed to the company. Trade payables are normally settled within normal trading terms. m. Provisions Provisions are recognised when AIA has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Where AIA expects some or all of the provision to be reimbursed, the reimbursement is recognised as a separate asset but only when the reimbursement is virtually certain. The expense relating to any provision is presented in the income statement net of any reimbursement.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) m. Provisions (continued) If the effect of the time value of money is material, provisions are determined by discounting the expected future cash flows at a discount rate that reflects current market assessments of the time value of money and, where appropriate, the risks specific to the liability. Where discounting is used, the increase in the provision due to the passage of time is recognised as a finance cost. n.
Employee benefits
Wages, salaries and annual leave Liabilities for employee benefits for wages, salaries and annual leave represent present obligations resulting from employees’ services provided up to the balance sheet date, calculated at undiscounted amounts based on remuneration rates that the company expects to pay, expected to be settled within 12 months. Long service leave Liabilities for employee benefits for long service leave represent the present value of the estimated future cash outflows to be made by the employer resulting from employees’ services provided up to the balance sheet date. The provision is calculated using expected future increases in wage and salary rates, including related on-costs and proportion rates based on expected settlement dates and on turnover history. Those entitlements which are not expected to be settled within twelve months are discounted using the rates attaching to national government securities at the balance sheet date, which most closely match the terms of maturity of the related liabilities. Superannuation plans Contributions are made by AIA to defined contribution superannuation funds and are charged as expenses when incurred. o.
Foreign currency translations
Both the functional and presentation currency of AIA is Australian dollars. Foreign currency transactions are converted to Australian dollars at the rates of exchange ruling at the dates of the transactions. Amounts receivable and payable in foreign currencies at the balance sheet date are converted at the rates of exchange ruling at that date. Gains and losses from conversion of assets and liabilities, whether realised or unrealised, are included in the income statement in the year in which the exchange rates change.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) p.
Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except: •
Where the amount of GST incurred is not recoverable from the Australian Tax Office (ATO). In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense.
•
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the balance sheet.
Cashflows are included in the statement of cashflows on a gross basis. The GST component of cashflows arising from investing activities which are recoverable from, or payable to, the ATO are classified as operating cashflows.
q.
Pro bono services and in-kind support
AIA receives pro bono services or donations from a range of providers including legal, information technology and human resource specialists. For 2008, AIA has assessed the fair or market value of these professional services or goods at $97,265 (2007: $203,934). The value of these services goods are recognised in the accounts as income with an equivalent expense. AIA also receives considerable in-kind support from other individual supporters and no assessment of the value of this support has been attempted. r.
Disposal of surplus
Rule 7.1 of AIA’s Memorandum of Association prohibits the distribution of any surplus to Members. All income must be applied towards the promotion of the objects of AIA. In 2005 the NEC determined that AIA should hold a certain level of reserves. Reserves are cash and cash equivalents, plus land and buildings. The amount of the reserves are determined through an annual risk based assessment based on Amnesty International guidelines. s.
Volunteer workers
AIA receives considerable services from its many volunteers. No assessment of the monetary value of this support has been attempted.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) t.
Significant accounting judgements, estimates and assumptions
The preparation of the financial report requires the making of estimates and assumptions that affect the recognised amounts of assets, liabilities, revenues and expenses and the disclosure of contingent liabilities. The estimates and assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. Significant 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 only affects that period, or in the period of revision and future periods if the revision effects both current and future periods. u.
Investments and other financial assets
Financial assets in the scope of AASB 139 Financial Instruments: Recognition and Measurement are classified as either financial assets at fair value through profit or loss, loans and receivables, held to maturity investments, or available-for-sale investments, as appropriate. When financial assets are recognised initially, they are measured at fair value. The company determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this designation at each financial year-end. AIA has loans and receivables, available-for-sale financial assets and financial assets at fair value as detailed below. (i) Financial assets at fair value through profit & loss Financial assets classified as held for trading are included in the category ‘financial assets at fair value through profit or loss’. Financial assets are classified as held for trading if they are acquired for the purpose of selling in the near term with the intention of making a profit. Gains or losses on financial assets held for trading are recognised in profit or loss and the related assets are classified as current assets in the balance sheet. (ii) Loans and receivables Loans and receivables are non derivative financial assets with fixed or determinable payments that are not quoted in an active market. Such assets are carried at amortised cost using the effective interest method. Gains and losses are recognised in profit or loss when the loans and receivables are derecognised or impaired. These are included in current assets, except for those with maturities greater than 12 months after balance date, which are classified as non current.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) u.
Investments and other financial assets (continued)
(iii) Available-for-sale-financial assets Available-for-sale-financial assets are those non-derivative financial assets that are designated as available-for-sale or are not classified as financial assets at fair value through profit or loss, held to maturity investments, or loans and receivables. After initial recognition available-for-sale investments are measured at fair value with gains or losses being recognised as a separate component of equity until the investment is derecognised or until the investment is determined to be impaired, at which time the cumulative gain or loss previously reported in equity is recognised in profit or loss. The fair value of investments that are actively traded in organised financial markets is determined by reference to quoted market bid prices at the close of business on the balance sheet date. v.
Fundraising activities
As a Charitable Institution and with Fundraising Authority issued by the NSW Government, AIA is subject to various state legislation and their reporting requirements as detailed below. Charitable Fundraising Act 1991 This Act and supporting regulations prescribe the manner in which fundraising appeals are to be conducted, controlled and reported in NSW. The amounts shown in Note 21 are in accordance with S23 (3) of the Act, Sections 5, 7 and 8 of the Regulations and Authority Condition 7. Donations and bequests Donations and bequests are returned as income as and when received in AIA’s offices or deposited in AIA’s bank account. As specified in the Act, unsolicited donations, members’ donations and bequests are not treated as fundraising income when determining information required under the Act. Costs of fundraising Costs in Note 21 include all direct fundraising costs in accordance with the Act. The inclusion of indirect costs is discretionary. Indirect costs include overheads such as rent, light, power, insurance and the time spent by accounting and office staff administering appeals and receipting but not directly involved in appeals. Mail appeals donations and cost allocation Mail appeals are targeted at both Members and non-Members. When determining what constitutes fundraising activities as required under the Act, revenue received from members is excluded and a comparable share of costs attributed to Members is also excluded. The allocation of both revenue and expenses on Mail appeals for 2008: 76.6% to non-Members, 23.4% to Members. (2007: 77.1% to nonMembers, 22.9% to Members.) No costs were attributed to Members for a share of Raffle, Candle Day or Event costs even though some members would have supported both. The impact on results is not material. Events have both a campaigning and fundraising objective. In 2007 event costs were allocated 50/50 between campaigning costs and fundraising costs. In 2008 this allocation was reviewed and changed to 75/25 due to events having an increased campaigning focus.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 1. STATEMENT OF ACCOUNTING POLICIES (continued) v.
Fundraising activities (continued)
Donor acquisition Bank charges incurred in receiving income from face to face approaches to the public through designated fundraising organisations and mass media appeals are recognised as a direct cost of fundraising. All donations with purchases of merchandise and one-off donations from non-Members are assumed to be the result of general campaigns and are reported as such. w.
Correction and reclassification of comparative information
There was a reclassification of ($159,632) relating to Revenue from Outside Operating Activities for the 31 December 2007 comparative. The amount relates to unrealised losses on financial assets, and was originally included within the Interest and Other revenue category in 2007. For the current financial year, given the increase in the unrealised losses on financial assets for the year, AIA has reclassified this amount as a separate item included within the Operating Expenses for the year, thus changing the Total Revenue amount to $19,032,125 (2007: $18,872,493) and the Total Expenses amount to $18,808,581 (2007: $18,648,949). Additionally, the financial assets at fair value through profit and loss have been reclassified from non current to current, to reflect the liquid nature of these items.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 2. OPERATING SURPLUS The operating surplus has been arrived at after charging / (crediting) the following items:
Amortisation expense Depreciation expense Write-down of inventory to net realisable value Operating lease / rental expense Cost of goods sold Employee benefit expense
2008 $
2007 $
32,599 692,657
542,294
4,592 717,544 152,609 5,431,986
2,104 692,928 147,749 4,580,012
2,018,144 2,022,249 4,040,393
2,409,918 2,000,000 4,409,918
3. CASH AND CASH EQUIVALENTS Cash at bank and on hand Bank short term deposits
Cash at bank and on hand earns interest at floating rates based on daily bank deposit rates. The short term deposits are held as a Bank Bill with the Commonwealth Bank of Australia. It has a face value of $2,029,043, earns interest at a rate of 4.38% and will mature on 12 January 2009. The fair value of cash and cash equivalents is $4,040,393 (2007: $4,409,918). a. Reconciliation of cash For the purposes of the cash flow statement, cash includes cash on hand and at bank and short term deposits at call. Cash at the end of the financial year as shown in the cash flow statement and is reconciled to the related item in the balance sheet as follows:
Cash on hand Group bank accounts Cash at bank At call deposit Bank short term deposits - maturing within 90 days Cash assets
Amnesty International Australia, Annual Financial Report 2008
2008 $
2007 $
2,901 41,305 696,359 1,277,579 2,022,249 4,040,393
2,893 46,322 381,447 1,979,256 2,000,000 4,409,918
Page 26 of 42
Notes to the Financial Statements for the Year Ended 31 December 2008 3. CASH AND CASH EQUIVALENTS (continued) b. Reconciliation of operating surplus to the net cash flows provided by operating activities 2008 $ Operating (Deficit) / Surplus for the year Adjustments for: Amortisation Depreciation Distributions-financial asset at fair value Unrealised loss-financial asset at fair value Loss on disposal of assets Sale / (receipt of financial asset) Net cash provided by operating activities before changes in assets and liabilities
(1,391,136)
2007 $ 223,544
32,599 692,657 (18,379) 402,233 81,359
542,294 12,814 (81,359)
(200,667)
697,293
(13,566) 43,923 (22,952) 204,900 106,001
(24,485) (126,095) (56,318) 370,640 29,740
117,639
890,775
2008 $
2007 $
129,088 367,714 496,802
109,436 364,414 473,850
Changes in assets and liabilities during the financial year (Increase) / decrease in inventories (Increase) / decrease in other assets (Increase) / decrease in receivables Increase / (decrease) in creditors Increase / (decrease) in provisions Net cash provided by operating activities
4. TRADE AND OTHER RECEIVABLES
Trade receivables Other receivables
Trade receivables are non-interest bearing and are generally due on 30 day terms and are normally settled on 60-day terms. Other receivables are non-interest bearing and consist mainly of GST amounts owing from the ATO and recognition of income received in 2008 but banked in 2009, and are normally settled within 60 days. For terms and conditions relating to related parties, refer to Note 20. The carrying values of receivables are a reasonable approximation of fair value
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 4. TRADE AND OTHER RECEIVABLES (continued) a) Aged receivables Year Ended 31 December 2008
Trade receivables Other receivables
0-30 Days $ 8,915 344,955 353,870
31-60 Days $ 3,607 4,109 7,716
61-90 Days $ 115,315 18,650 133,965
> 90 Days $ 1,251 1,251
Total $ 129,088 367,714 496,802
31-60 Days $ 3,310 3,310
61-90 Days $ 93,030 93,030
> 90 Days $ 8,364 8,364
Total $ 109,436 364,414 473,850
Year ended 31 December 2007
Trade receivables Other receivables
0-30 Days $ 4,732 364,414 369,146
5. OTHER CURRENT ASSETS
Prepayments Other Assets
2008 $
2007 $
106,098 192,653 298,751
154,334 188,339 342,673
Other assets represent bonds and deposits paid on activist resource centres around Australia. No Other Assets are past due. 6. INVENTORIES
Finished goods
Amnesty International Australia, Annual Financial Report 2008
2008 $
2007 $
95,382
81,816
Page 28 of 42
Notes to the Financial Statements for the Year Ended 31 December 2008 7. PROPERTY, PLANT AND EQUIPMENT 2008 $
2007 $
Plant and equipment, at cost Less: accumulated depreciation Net Plant and equipment
1,317,409 (762,500) 554,909
1,118,058 (419,540) 698,518
Leasehold improvements, at cost Less: accumulated depreciation Net Leasehold improvements
1,779,305 (630,454) 1,148,851
1,692,567 (283,862) 1,408,705
3,096,714 (1,392,954) 1,703,760
2,810,625 (703,402) 2,107,223
Total cost Total accumulated depreciation Total Property, plant and equipment
Reconciliations of the carrying amounts for each class of property, plant and equipment are set out below: 2008 2007 $ $ Plant and equipment: Carrying amount at beginning of the year 698,517 386,234 Additions 202,457 616,838 Disposals (12,814) Depreciation (346,065) (291,741) Carrying amount at the end of the year 554,909 698,517 Leasehold improvements: Carrying amount at beginning of the year Additions Depreciation Carrying amount at the end of the year
1,408,705 86,738 (346,592) 1,148,851
438,620 1,220,638 (250,553) 1,408,705
Total Property, plant and equipment: Carrying amount at beginning of the year Additions Disposals Depreciation Total carrying amount at the end of the year
2,107,223 289,194 (692,657) 1,703,760
824,854 1,837,477 (12,814) (542,294) 2,107,223
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 8. INTANGIBLES
Intangible assets, at cost Less: accumulated depreciation Total Intangible assets
2008 $ 197,970 (32,599) 165,371
2007 $ -
Reconciliations of the carrying amounts for each class of intangibles are set out below: Intangibles : Carrying amount at beginning of the year Additions Depreciation Carrying amount at the end of the year
197,970 (32,599) 165,371
-
9. FINANCIAL ASSETS Current Available-for-sale financial assets: Listed shares at fair value
-
81,358
Financial assets at fair value through profit and loss: Investment in managed fund
1,067,643
1,451,497
Total current financial assets
1,067,643
1,532,855
The managed funds reflect a portion of AIA’s financial reserves.
10. TRADE AND OTHER PAYABLES Current Trade payables Other payables & accruals
Non current Lease incentive accrual
751,463 338,885 1,090,348
389,502 500,579 890,081
221,786 221,786
217,151 217,151
Trade payables are non-interest bearing and are settled on the terms specified by the supplier, normally settled on 60-day terms Other payables are also non-interest bearing and are normally settled within 60 days. The lease incentive accrual is an accounting adjustment which spreads rent incentives over the life of the lease. For terms and conditions relating to related parties, refer to Note 20. The carrying values of payables are a reasonable approximation of fair value, due to the short term nature.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 10. TRADE AND OTHER PAYABLES (continued) The table below summarises the maturity profile of the financial liabilities at 31 December 2008. Year Ended 31 December 2008
Trade payables Other payables
0-30 Days $ 705,623 338,885 1,044,508
31-60 Days $ 10,928 10,928
61-90 Days $ 1,161 1,161
> 90 Days $ 33,751 33,751
Total $ 751,463 338,885 1,090,348
31-60 Days $ 3,709 3,709
61-90 Days $ 2,884 2,884
> 90 Days $ -
Total $ 389,502 500,579 890,081
Year ended 31 December 2007
Trade payables Other payables
0-30 Days $ 382,909 500,579 883,488
11. EMPLOYEE BENEFITS - SUPERANNUATION AIA makes contributions to defined contribution superannuation funds. The amount recognised as an expense in the income statement is $398,018 (2007: $330,683).
12. CURRENT LIABILITIES - PROVISIONS
Long service leave Annual leave
Amnesty International Australia, Annual Financial Report 2008
2008 $
2007 $
144,776 288,348
143,619 256,239
433,124
399,858
Page 31 of 42
Notes to the Financial Statements for the Year Ended 31 December 2008 13. NON-CURRENT LIABILITIES - PROVISIONS
Make good provision Long service leave
2008 $
2007 $
45,720 103,119
76,104
148,839
76,104
(a) Movement in provisions Movements in each class of provision during the financial year, other than provisions relating to employee benefits, are set out below: Make good provision $ At 1 January 2008 Arising during the year Utilised
45,720 -
At 31 December 2008
45,720
(b) Nature and timing of provisions (i)
Make good provision
In accordance with the lease agreement for our Queensland Action Centre, Amnesty International Australia must restore the premises to its original condition at the end of the lease term in 2012. A provision of $45,720 was raised in 2008 in respect of the company’s obligation to remove leasehold improvements from these leased premises and is included in the carrying amount of the leasehold improvements. (ii)
Long service leave
Refer to note 1(n) for the relevant accounting policy.
Number of employees (Full time equivalent at year end)
Amnesty International Australia, Annual Financial Report 2008
2008
2007
78
69
Page 32 of 42
Notes to the Financial Statements for the Year Ended 31 December 2008 14. OPERATING LEASE COMMITMENTS AIA has entered into commercial leases on certain buildings and items of office equipment. The leases on buildings have an average life of between 1 and 7 years with renewal terms included in the contracts. Renewals are at the option of AIA. Most lease contracts provide for escalating lease payments based on general inflationary indices. The leases for office equipment have an average life of between 2 and 5 years with renewal terms included in the contracts. Renewals are at the option of AIA. There are no restrictions placed upon the lessee by entering into these leases. Future minimum rentals payable under non-cancellable operating leases as at 31 December 2008 are as follows:
Within one year After one year but not more than 5 years More than 5 years
2008 $ 783,266 1,828,522 -
2007 $ 752,713 2,461,131 49,892
Total
2,611,788
3,263,736
15. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES AIA’s principal financial instruments comprise of cash, short term deposits and investments in managed fund. AIA also has other financial instruments such as trade receivables and trade payables which arise directly from its operations. The main risks arising from AIA’s financial instruments are interest rate risk, equity price risk and liquidity risk. A. Interest rate risk Interest rate risk arises from the possibility that changes in interest rates will affect future cash flows or the fair values of financial instruments. Cash and cash equivalents, as defined in note 3a, are the only financial instruments of the company exposed to changes in interest rates. It is AIA’s policy to invest cash with a recognised financial institution. Total interest earned was $236,313 (2007: $237,701). The weighted average interest rate was 6.38% (2007: 6.02%). The following table demonstrates the sensitivity to a reasonable possible change in interest rates, with all other variables held constant, of the company’s income statement through the impact on floating rate financial assets and financial liabilities. The sensitivity of the income statement is the effect of the assumed changes in interest rates on the net interest income for one year, based on the floating rate financial assets and financial liabilities held at 31 December 2008. The sensitivity analyses do not take account of actions by the company that might be taken to mitigate the effect of such changes.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 15. FINANCIAL RISK MANAGEMENT OBJECTIVES AND POLICIES (continued) A. Interest rate risk (continued) Effect on equity and income statement 2008 2007 $ $
Increase in basis points
+200
81,000
88,000
Effect on equity and income statement 2008 2007 $ $
Decrease in basis points
-100
(40,000)
(44,000)
B. Liquidity risk and funding management Liquidity risk is the risk that the company will be unable to meet its payment obligations as and when they fall due. To limit this risk, management has set aside financial reserves (currently invested in managed funds and bank bills) in addition to its core cash base, manages assets with liquidity in mind, and monitors future cash flows and liquidity on a monthly basis. This incorporates an assessment of expected cash flows. Refer to Note 10 for the ageing assessment of financial liabilities.
C. Equity price risk Equity price risk is the risk that the fair value of equities decreases. The non-trading equity price risk exposure arises from the company’s managed fund investment. The effect on the income statement and equity as a result of a change in the fair value of the managed fund investment at 31 December 2008 due to a reasonably possible change in the following market indices, with all other variables held constant, is as follows: Market indices
Increase in indices (%)
Managed fund
+5
Market indices
Decrease in indices (%)
Managed fund
-10
Amnesty International Australia, Annual Financial Report 2008
Effect on equity and income statement 2008 2007 $ $ 53,000
73,000
Effect on equity and income statement 2008 2007 $ $ -107,000
-145,000
Page 34 of 42
Notes to the Financial Statements for the Year Ended 31 December 2008
16. CORPORATE INFORMATION The financial report of Amnesty International Australia for the year ended 31 December 2008 was authorised for issue in accordance with a resolution of the directors on 3rd April 2009. AIA is a public company incorporated and domiciled in Australia and limited by guarantee. The members are members of the public who have paid the annual membership fee. As at 31 December 2008 there were 15,577 members (2007: 16,389 members). A maximum amount of $100 is guaranteed by each member in the event that the company is wound up.
17. SEGMENT INFORMATION Amnesty International Australia operates in one industry - human rights campaigning, awareness raising and fundraising and in one geographical area - Australia.
18. AUDITOR’S REMUNERATION 2008 $ Audit of financial report - Ernst & Young Other assurance related services - Ernst & Young
35,400 -
2007 $ 34,990 2,000
19. DIRECTORS REMUNERATION All directors at both national and regional level provide their services free of charge. No remuneration was paid to directors except for some reimbursement of expenses incurred in the course of their duties.
20. RELATED PARTIES (a) Directors The names of each person holding the position of Director of AIA during the financial year are: Nicole Bieske, James Sharp, Dawna Wright, Michael Butler, Georgina Perry, Catherine Cooper, Sheena Graham, Caroline Wood, Russell Solomon, Perdita Sonntag, Anthony Mitchell, Maree Klemm, Toni Matulick, Denise Skiffington, Sarah Holloway, Tracy Crisp, Gregory Luckman, Helen Patricia Corbett, Stuart Webb, Peter Hanley, Debra Johnson, Alice Linacre and Clare Wiseman There were no loans to Directors at any time in the year ended 31 December 2008. If a Director from time to time purchases goods from the company it is on the same terms and conditions as available to employees.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 20. RELATED PARTIES (continued) (b) Key management personnel remuneration
Short-term Salary Incl. Leave Paid $
Salary Packaging $
Post Employment Superannuation
Bonus $
$
Total $
2008
580,274
91,394
-
56,112
727,780
2007
612,840
80,541
16,054
55,129
764,564
(c) Transactions with the international movement of Amnesty International and other Amnesty sections. Each year Amnesty International Australia contributes to the international movement via the International Secretariat according to an assessment based on Amnesty International Australia previous financial results. The 2008 assessment incurred was $4,210,343 (2007: $3,307,393). Actual assessment payments made were $4,210,343 (2007: $3,307,393). During the year Amnesty International Australia purchased publications and campaign materials from the International Secretariat. The company also incurred costs on behalf of the international movement which were deducted from assessment payments. As at 31 December 2008, an amount of $7,498 (2007: $33,694) is due to the international movement and an amount of $16,657 (2007: $19,740) is due from the international movement.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 21. CHARITABLE FUNDRAISING ACT (NSW) 1991 a) Details of aggregated gross income and total expenses of fundraising appeals: Results of fundraising appeals Gross proceeds from fundraising appeals Less: Direct costs of fundraising appeals Net surplus from fundraising appeals
2008 $ 15,763,728 (4,537,531) 11,226,197
2007 $ 14,971,212 (4,529,429) 10,441,783
b) Details showing how funds received were applied to Charitable purposes: Application of net surplus obtained from fundraising appeals: Campaigning, merchandise, governance etc costs Unrealised loss on financial asset at fair value Administration Expenses Total application
14,590,396 402,233 913,966 15,944,278
13,383,066 159,632 _736,454 14,279,152
The shortfall between the $11,226,197 (2007: $10,441,783) surplus available from fundraising appeals conducted and total distribution of $15,994,278 (2007: $14,279,152) was provided by the following sources Donations (from Members) Membership fees Bequests Merchandising Interest and other
1,707,901 620,008 379,442 375,047 244,547 3,326,945
1,860,188 721,146 694,914 383,315 401,349 4,060,912
c) Fundraising appeals conducted during the financial year: Fundraising appeals were conducted during the financial year by mail, telephone and face to face street fundraising. In addition funds were raised by a raffle, the Candle Day appeal, donations from non-Members and numerous fundraising events. Donations and fundraising in this note follow the definition in the Charitable Fundraising Act. As such each differs from that in the income statement (due to the classification imposed by the Act). However in total they agree.
Amnesty International Australia, Annual Financial Report 2008
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Notes to the Financial Statements for the Year Ended 31 December 2008 21. CHARITABLE FUNDRAISING ACT (NSW) 1991 (continued) d) Comparisons of certain monetary figures and percentages: 2008
2007
$
%
$
%
Total cost of fundraising/ gross fundraising income
4,537,531 15,763,728
29%
4,529,429 14,971,212
30%
Net surplus from fundraising/ gross fundraising income
11,226,197 15,763,928
71%
10,441,783 14,971,212
70%
Total costs of campaigning, merchandise, governance etc/ total expenditure
15,944,278 20,418,810
78%
14,279,152 18,808,581
76%
Total costs of campaigning, merchandise, governance etc/ total income received
15,944,278 19,090,674
84%
14,279,152 19,032,124
75%
e) Details of Results of Fund Raising Appeals Fundraising: Revenue/Expense Comparison 2008 2007 Ratio of Expenses cost to Revenue Expenses Revenue
Ratio of cost to Revenue
Types of appeal
Revenue
Candle Day Mail Appeals Non-member regular giving/donations Events
22,760 959,306
9,119 354,859
40% 37%
47,917 1,225,487
23,652 400,558
49% 33%
14,403,253
4,053,584
28%
13,294,389
3,988,141
30%
378,409
119,969
32%
403,419
117,078
29%
15,763,728
4,537,531
29%
14,971,212
4,529,429
30%
Total
Amnesty International Australia recognised that Candle Day 2007 did not meet the 40% guideline set out in Standard Authority Condition 8, and reviewed the conduct of the event. For 2008 the ratio of costs to revenue both overall and by fundraising category is within the 40% guideline. Street face to face fundraising is highly cost effective when considered over a longer period as all fees are paid up front. For 2008 distributions and unrealised losses on our investments (financial asset at fair value) have been separately itemised for greater transparency. To allow consistent comparison, the 2007 comparatives have additional information to show distributions and unrealised losses. These adjustments do not effect the ratios previously shown in the 2007 Annual Financial Report.
Amnesty International Australia, Annual Financial Report 2008
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