(eating quality, carcass performance, feed program performance)
Communicate BIN Project
Results
BREEDPLAN Incentives
Development of commercial market indicies Breed
OPERATING OUTCOMES
Transition to Single Step
Improved Data Capture
(eating quality, carcass performance, feed program performance)
Communicate BIN Project
Results
BREEDPLAN Incentives
Development of commercial market indicies
Projects
ACTIONS
Benefits of the Droughtmaster female
Strategic partnerships
Suitability to multi-markets
Droughtmaster beef
Commercial performance and sustainable and natural production (both grass and grain fed)
Testimonials and case studies
Bull and female sales
Benefits of cross breeding
OPERATING OUTCOMES
Increased registrations
Membership growth
Growth in our geographical footprint
Increased demand for Droughtmaster Bulls and Females
Increased awareness of the quality and demand for Droughtmaster beef
Less reliance on BIN Project Income
ACTIONS
Strategically targeted
locations
Investment & improvements to existing sales, events & activities
Increased commitment to school agricultural programs and provide content for their curriculums
OPERATING OUTCOMES
Increased registrations
Growth in our geographical footprint
Increase in the number of schools using Droughtmaster ca le in their curriculum
Income to subsidise labour costs for Society Sponsored Sales
ACTIONS
Improvements to o ice facilities
Diversified income streams
Financial management and Investment
Business model
improvements
Sta training & development
R&D funding for various projects
OPERATING OUTCOMES
Improved operational e iciency
Growth and sustainability of the Society
Additional Income Streams
Commitment to ESG
ACTIONS
Celebrate our people
Heighten the appeal of being a member
Provide members with educational content to assist with operating their businesses
Regular and e icient communication
OPERATING OUTCOMES
Member retention and improvements in value to members.
Member satisfaction
SOCIETY HIGHLIGHTS
PRESIDENT’S REPORT
Todd Heyman | President
I AM PLEASED TO SUBMIT the Annual Report for the Droughtmaster Stud Breeders’ Society for the financial year ended 31 March 2024.
Operating Result
The operating profit of the Society amounted to $3639 and an overall financial loss of $81,675. Several items of note include:
• The BIN Steer research project – For some years, the financial position of the Society has benefitted from the BIN Steer Research and Development project. Via the BIN Steer project, the Society purchases young steers to gather data to predict traits to improve genetic reproduction of the Droughtmaster breed, then processes and sells the steers while again receiving valuable data. In 202324, the BIN Steer project sustained a significant market downturn combined
with adverse seasonal conditions, which resulted in a loss of $85,314.
• Significant inflation across the services upon which the Society relies – While savings and efficiencies have been identified and implemented, Droughtmaster Australia, as a servicebased organisation, has continued to see inflation across the services that it uses.
• Outstanding debts – Our independent auditor has taken up a provision in our financial statements of $41,756 which has also had a negative effect on our operating profit. The Society has made every effort to give several members an opportunity to settle this debt.
To summarise the financial performance, the Society made a small operating profit of $3639 despite a provision for bad debt of $41,756. The operating profit of $3639 turned to an overall financial loss of $81,675 after allowing for the loss on the BIN Project of $85,314.
Furthermore, the balance sheet remains strong with a healthy cash balance and solid liquidity ratios.
For some years, your Board has been working toward reducing the Society’s reliance on the unpredictable and unbudgeted costs and returns of the BIN Steer project. The above result demonstrates and confirms both the rationale for this course of action and that the underlying financial model of the Society is strong.
In fact, the work that the Society has undertaken to strengthen its business model was recognised in the reported year when Droughtmaster Australia was awarded an Australian Business Award for Business Transformation. The Australian Business Awards recognise organisations that
PRESIDENT’S REPORT
have successfully implemented initiatives that demonstrate excellence in business transformation.
A key focus of the activities of the Society detailed in the financial records has been to implement its Strategic Plan, The Next Phase 2023-2025 which includes ensuring that the activities of the Society are aimed at promoting the breed beyond our existing events and markets.
For example, 2023 saw the breed focus on markets with high growth potential, in particular, Western Australia, which continues to emerge as a growth market for our breed.
Growing our membership and the geographic footprint of the breed serves several purposes:
• Expanding and growing the market demand for your cattle – increasing the value cents per kg demand for your herd.
• Opening peripheral market opportunities for the breed – exposing different areas/ parties to our cattle.
• Insulating the breed and society from shocks associated with events (natural disasters/droughts, economic downturns, disease outbreaks) that might strike a specific geographic area.
The future activities of the Society will also continue to include promotion and marketing to the entire protein supply chain. We will continue to highlight that our breed has been developed to naturally and sustainably meet the requirements for our changing future.
• Members should be left in no doubt that the activities of the Society over the coming years will be focussed on:
• Growth in inventory to 40,000 females by 2025. In August 2023 (after allowing
(CONTINUED)
for culls) there were 34,133 females in the Droughtmaster herdbook.
• Growth in membership to 750 members by 2025. As of 31 March 2024, we closed the year with 711 members.
• Geographic spread in inventory and membership.
• Building our reputation as Australia’s most natural and sustainable beef cattle breed.
• Increasing the amount of Droughtmaster beef served on menus across Australia.
• Developing the breed and the data attached to the breed.
• Increasing the exposure of the breed in school curriculums.
Beyond the period reported in this Annual Report, there has been a continued focus on growing and promoting the Droughtmaster breed, improving member engagement, encouraging participation of younger generations and identifying growth opportunities.
I would like to express my and the Board’s appreciation for the efforts and achievements of the CEO, Simon Gleeson, and office staff over the last year.
Many of the Society’s activities would not be possible without their perseverance, enthusiasm, hard work, planning and astute, professional advice.
Finally, I would like to once again thank the many positive and enthusiastic members who have continued to contribute to Society events, committees and initiatives across the country.
Todd Heyman, President on behalf of the Board of Directors
CEO’S REPORT
Simon Gleeson | Chief Executive Officer
THE LAST YEAR has clearly illustrated the value of breeding Droughtmaster, with the breed’s renowned characteristics of adaptability to various environments and suitability for multiple markets allowing for greater expansion across the country.
The jewel in the crown is certainly the Droughtmaster female, which is considered by many good judges to be the breeding female of choice in the beef industry.
The Droughtmaster female is not only recognised as an asset in purebred herds but is also becoming popular for crossbreeding programs across the country.
Over the past year we have really targeted our promotion of the Droughtmaster female, which has not only helped grow our inventory, but has also helped generate greater market interest.
One promotion included a video, which tracked the movement of Droughtmaster females, bound from Hughenden to Cobar in western NSW to mate with Angus bulls.
The video highlighted the females’ adaptability and their progeny’s eligibility for domestic market requirements. This video was widely distributed across our social media channels and received record viewings of 18,500 on Facebook.
In April 2023, Board members and I travelled to Western Australia to meet with our members and attend both the Munda Reds and Fieldhouse Bull Sales.
We were able to gain useful insights into growth opportunities and marketing strategies across WA. We also hosted an information session for members, followed by drinks at the Jurien Bay Hotel, about two hours’ drive north of Perth.
It was interesting to see the number of Queenslanders attending both bull sales and purchasing bulls in WA.
As per our Strategic Plan, the Next Phase 2023-2025, we continually aim to promote the breed in strategically targeted locations, especially in WA and NSW, and grow our geographical footprint more broadly.
June 2023 was the Northern Beef Producers Expo in Charters Towers, Qld which was well supported by our members, staff and Board members.
The Droughtmaster breed dominated this competition and I thank all the members who participated in showcasing quality stock at this event. Charters Towers and district is another growth area that we are targeting, so the publicity and promotion that came from this event was extremely valuable.
CEO’S REPORT
(CONTINUED)
Also in June, we participated in the FarmFest Field Days in Toowoomba, Qld where we made some capital improvements to the shed housing our display, which ultimately won an award for ‘best presented display’ at the event.
Some of our influential breeders gathered at CQLX, Gracemere, Qld in July 2023, where David Johnston and Matt Woolcott were invited to present on data collection and submission of data to BREEDPLAN.
David and Matt highlighted the importance that data can have on breeding decisions and how it can improve the breed characteristics through selection.
The purpose of this workshop was also to encourage our influential breeders to submit data to BREEDPLAN prior to us transitioning to Single Step to further improve accuracies in BREEDPLAN.
August 2023 was a busy month with the release of our annual Droughtmaster magazine, the annual general meeting, the Ekka, participating in the Best Breed steak dining competition at Brisbane’s Norman Hotel, attending AgQuip in Gunnedah and sponsoring the Long Drive for Drought where we provided Droughtmaster beef for 500 guests.
As we rolled into Spring, bull sales started to ramp up and sponsored sales became our focus.
We had 88 members participate at the Droughtmaster National Sale and 30 members at the Roma Bull Sale.
There were also many other private sales that occurred during this time, and I thank our members who hosted and promoted these sales.
There were breed records achieved by both a bull and heifer at the Glenlands Sale in
September 2023 where bull Glenlands D Everest was sold for $320,000 and heifer Glenlands D English Rose sold for $70,000. We congratulate Glenlands on these results.
In October we were successful in the Australian Business Awards, recognised for successfully implementing initiatives that demonstrate excellence in business transformation.
In 2019, the Board implemented an assertive strategic plan which underpinned this transformation.
We received strong publicity because of winning this award, with stories in Beef Central, Queensland Country Life, Country Caller, City Beat in the Courier Mail and on radio via Rural Queensland Today.
Winning this award signals to our members and anyone with an eye to breeding or running Droughtmaster cattle in the years ahead, or doing business with our organisation, that we are professional and future focussed.
Some notable winners of this award in the past include Westpac, Swinburne University, MTAQ, National Blood Authority and Sydney Water.
It is important that we don’t become complacent and continue to drive the business forward in line with our Strategic Plan, The Next Phase 2023-2025. I would encourage those who have not reviewed this plan to visit our website.
Also in October, we transitioned to Single Step, which was an important milestone for the breed after years of preparation.
Most other notable breeds have already made the transition, so it was important that we remained in step with other breeds.
CEO’S REPORT
(CONTINUED)
A major factor in this transition is due to our participation in both the Repronomics and BIN. Without the collection of data from these projects, we would have missed the reference population required within the membership to facilitate this transition. This year we only processed 42 head in the BIN project. As expected, the price we received for these cattle was significantly less than what we had paid for them due to market changes, impacting our financial result.
In addition, we also incurred higher operating costs due to below average seasonal conditions and this also contributed to our financial loss. Notwithstanding, this project is very important to the Society for reasons mentioned above.
Over the course of the year, we were also very busy with preparations for Beef Australia 2024. This has become a significant event and requires about 18 months of planning, in addition to the many other activities that dominate our calendar of events during the year.
On that note, I would sincerely like to thank the administration team: Sales and Events Manager, Leigh Eleison; Registrar, Member Services and DNA Coordinator Leah Wall; Marketing and Events Coordinator, Carley Stieler and Office Services and Membership Coordinator, Jacinta Brown.
In concert with all the volunteers who contribute to Society activities, events and sales, there is no doubt without our office team’s support we wouldn’t be able to achieve what we have this year.
Thank you also to the members for your ongoing support and for promoting the Droughtmaster breed with enthusiasm. Finally, to our President, Todd Heyman, our Company Secretary Michele Galagher and all other Board members – thank you.
Your commitment, dedication and leadership have been outstanding.
Simon Gleeson Chief Executive Officer
REGISTRAR’S REPORT
REFLECTING ON ANOTHER YEAR , we again saw growth in inventory, memberships and a significant increase in DNA testing. This certainly aligns with our strategic direction.
The increased inventory added to the Herdbook remains on trend due to good seasons and higher cattle prices.
This has been welcomed following the horrendous drought and floods that occurred in 2019. We are anticipating continued growth in inventory as membership grows with further geographical spread.
Membership growth has been a function of our marketing campaigns, and it is wonderful to welcome new and enthusiastic members. It is also refreshing to see our new members purchasing cattle at both our Society Sponsored Sales and private sales to commence their breeding programs.
DNA testing continues to grow exponentially, with many members taking advantage of the bundle tests negotiated by the Society with Neogen and Zoetis.
These bundles are also continually evolving and this year we introduced the option of Myostatin within these bundle tests. The bull and female sale market now consider DNA testing a necessity when selling at auction.
In summary, 2023-24 has been very busy although very rewarding.
I would like to take this opportunity to thank everyone for the opportunity of maintaining the Droughtmaster Herdbook as this is my last report with Droughtmaster Australia.
I am now moving onto a new career, and I thank you all for your kindness, support and understanding over the past four years.
Special thanks to my colleagues Leigh Eleison, Jacinta Brown and Carley Stieler who made each day enjoyable and to Simon for his leadership and support.
Leah Wall Registrar, DNA Coordinator and Member Services
SALES AND EVENTS REPORT
THE 2023-24 FINANCIAL YEAR saw 2459 animals offered at an 81% clearance through 26 public Droughtmaster sales nationwide, a slight increase on the 2022-23 financial year offering despite market uncertainty.
Committee members from all sales, along with selling agents, deserve congratulations for their help in promoting and maintaining market confidence in our breed.
We continue to streamline and improve the processes of Society sponsored sales and events and are always scoping new and inventive ways to improve all processes to facilitate the efforts of vendors, buyers and agents.
The 2024 Droughtmaster Futurity continued along the same two-day format which was rolled out in 2023.
Nominations for the Futurity were up 36% and exhibitors rose by 45%.
The junior paraders and judging competitions were once again well supported by schools, interested juniors and our junior Droughtmaster members. We look forward to elevating this event even further in 2025.
Leigh Eleison Sales & Events Manager
MARKETING REPORT
OUR 2023-24 MARKETING STRATEGY focused on promoting the Droughtmaster breed as the source of high-quality beef for domestic and export supply chains.
Furthermore, our aim has been to improve brand awareness for both stud and commercial producers.
In turn, this has supported our goals of increasing membership and inventory consistent with our Strategic Plan, The Next Phase 2023-2025
We will continue to maintain our advertising campaigns, creating a presence in the beef industry as a leading and innovative breed and building on the foundations we implemented a few years ago.
It’s vitally important that our marketing is consistent and remains at the forefront of our operation.
Our digital marketing has continued to expand online and through our social media channels, where targeted digital marketing is proving cost-effective in reaching larger audiences in specifically targeted geographical locations of priority to the business.
Several videos were produced to communicate our key messages.
Of note was the video we produced following the movement of Droughtmaster females from northern Queensland to western NSW.
This video highlighted the performance of Droughtmaster females in NSW and their suitability for crossbreeding to produce progeny suitable for domestic markets.
Focussing on a new geographical area, the video has enjoyed the highest number of views among all our productions and has contributed strongly to growing our social media following in NSW.
In conjunction with the video productions, we have also developed several marketing assets to promote the breed which include advertisements in a variety of publications and platforms, further enhancing brand awareness and brand identity.
Regarding events across the country, we were strong supporters of the West Australian Youth Cattle Camp, the Northern Beef Producers Expo, Gympie District Beef Liaison Group Cattle Camp, Farmfest and AgQuip.
Our presence at these events is extremely important in building relationships, networking and showcasing the breed.
It was an eventful year, and the Droughtmaster breed is in a very strong position. We look forward continuing to promote the breed in line with the objectives set out in our Strategic Plan, The Next Phase 2023-25
Carley Stieler Marketing and Events Coordinator
DIRECTORS’ REPORT
Droughtmaster Stud Breeders’ Society Limited
For the year ended 31 March 2024
The directors present their report on Droughtmaster Stud Breeders’ Society Limited for the financial year ended 31 March 2024.
1. General information
Information on directors
The names of each person who has been a director during the year and to the date of this report are:
Names Appointed/Resigned
Angus McCormack
Anna Hicks Powell (ceased 11 Aug 2023)
Bronwyn Betts
Ken McKenzie
Todd Heyman
Hastings Donaldson
Alex Power
Kellie Williams
Steve Farmer (from 11 Aug 2023)
Olivia Wright (from 27 Nov 2023)
Andy Hayes (from 27 Nov 2023)
Directors have been in office since the start of the financial year to the date of this report unless otherwise stated.
Principal activities
The principal activity of Droughtmaster Stud Breeders’ Society Limited during the financial year was promotion and recording of Droughtmaster breed of cattle.
No significant changes in the nature of the Company’s activity occurred during the financial year.
Short term objectives
The Company’s short term objectives are:
• Promote, develop and protect the breed and the brand, identify activities that will further increase breed participation; and
• Enhance membership of the Breed Society by delivering more efficient services, benefits and value.
Long term objectives
The Company’s long term objectives are to:
• To be recognised nationally throughout the entire supply chain (paddock to plate) as a breed that was developed in Australia to suit the Australian environment for its resilience and exceptional meat quality.
Strategy for achieving the objectives
To achieve these objectives, the Company has adopted the following strategies:
• The traditional functions of the Droughtmaster Society will always remain core, however we must continue to be relevant and evolve to remain competitive in the beef industry
How principal activities assisted in achieving the objectives
The principal activities assisted the Company in achieving its objectives by:
• Promotion & marketing;
• Embrace technology;
• Retain & recruit members;
• Cultural reset & unity;
• Sponsors & corporate partners;
• Operational efficiency; and
• Financial management.
Performance measures
The following measures are used within the Company to monitor performance:
• Member retention & growth through improved communications, benefits and value;
• Brand awareness through improved marketing and promotion;
• Improved data capture and utilisation;
• Up weighting in Society activities, events and sponsored sales;
• Genetic improvement and breed excellence, protect breed integrity;
• Increased partnerships and sponsorships;
• Operational efficiency and financial management; and
• Advancement in technology.
Members’ guarantee
Droughtmaster Stud Breeders’ Society Limited is a company limited by guarantee. In the event of, and
for the purpose of winding up of the company, the amount capable of being called up from each member and any person or association who ceased to be a member in the year prior to the winding up, is limited to $ 20 for members that are corporations and $ 20 for all other members, subject to the provisions of the company’s constitution.
At 31 March 2024 the collective liability of members was $13,960 (2023: $13,460).
2. Other items
Future developments and results
Likely developments in the operations of the Company and the expected results of those operations in future financial years have not been included in this report as the inclusion of such information is likely to result in unreasonable prejudice to the Company.
Meetings of directors
During the financial year, 7 meetings of directors (including committees of directors) were held. Attendances by each director during the year were as follows:
Auditor’s
independence declaration
The lead auditor’s independence declaration in accordance with section 307C of the Corporations Act 2001, for the year ended 31 March 2024 has been received and can be found on page 4 of the financial report.
Signed in accordance with a resolution of the Board of Directors:
Dated 24 June 2024
AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 307C OF THE CORPORATIONS ACT 2001 TO THE DIRECTORS OF DROUGHTMASTER STUD BREEDERS’ SOCIETY LIMITED
I declare that, to the best of my knowledge and belief, during the year ended 31 March 2024, there have been:
(i) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and
(ii) no contraventions of any applicable code of professional conduct in relation to the audit.
INDEPENDENT AUDIT
SERVICES
Chartered Accountants
Jiahui (Jeremiah) Thum Director Brisbane, QLD
Dated this 24th day of June 2024
Angus McCormack, Director
Todd Heyman, Director
INCOME Droughtmaster Stud Breeders’ Society Limited For the year ended 31 March 2024
STATEMENT OF FINANCIAL POSITION
Droughtmaster Stud Breeders’ Society Limited
As at 31 March 2024
1,277,207 1,358,882
STATEMENT OF CHANGES IN EQUITY
year ended 31 March 2024
STATEMENT OF CASH FLOWS
NOTES TO THE FINANCIAL STATEMENTS Droughtmaster Stud Breeders’ Society Limited For the year ended 31 March 2024
The financial report covers Droughtmaster Stud Breeders’ Society Limited as an individual entity. Droughtmaster Stud Breeders’ Society Limited is a not for profit Company limited by guarantee, incorporated and domiciled in Australia.
The functional and presentation currency of Droughtmaster Stud Breeders’ Society Limited is Australian dollars.
Comparatives are consistent with prior years, unless otherwise stated.
1 Basis of Preparation
The financial statements are general purpose financial statements that have been prepared in accordance with the Australian Accounting Standards Simplified Disclosures and the Corporations Act 2001.
The financial statements have been prepared on an accruals basis and are based on historical costs modified, where applicable, by the measurement at fair value of selected non current assets, financial assets and financial liabilities.
Significant accounting policies adopted in the preparation of these financial statements are presented below and are consistent with prior reporting periods unless otherwise stated.
2 Summary of Significant Accounting Policies
(a) Revenue and other income
Revenue from contracts with customers
The core principle of AASB 15 is that revenue is recognised on a basis that reflects the transfer of promised goods or services to customers at an amount that reflects the consideration the Company expects to receive in exchange for those goods or services.
Generally the timing of the payment for sale of goods and rendering of services corresponds closely to the timing of satisfaction of the performance obligations, however where there is a difference, it will result in the recognition of a receivable, contract asset or contract liability.
None of the revenue streams of the Company have any significant financing terms as there is less than 12 months between receipt of funds and satisfaction of performance obligations.
Specific revenue streams
The revenue recognition policies for the principal revenue streams of the Company are:
Female Inventory Fees
This is a charge for registering females and forms part of annual membership fees. Revenue is recognised at the beginning of the financial year.
DNA Testing Revenue
This is a charge for DNA testing done on cattle for members. Revenue is recognised when testing is performed.
Breed Promotion Fee
This is breed promotion levy charge and forms part of annual membership fees. Revenue is recognised at the beginning of the financial year.
Stud Membership
This forms part of annual membership fees. Revenue is recognised at the beginning of the financial year.
Society Sponsored Sales – Nomination Fees
Nomination fees are charged in two parts for Society Sponsored Sales. Number nomination fees (1/2 full nomination fee) are charged out at close of number nominations and the remainder of the fee, Pedigree nomination fee, are charged out at the close of pedigree nominations.
BIN Research Project
This is sale of research livestock. Revenue is recognised when a livestock is sold.
Statement of financial position balances relating to revenue recognition
Contract assets and liabilities
Where the amounts billed to customers are based on the achievement of various milestones established in the contract, the amounts recognised as revenue in a given period do not necessarily coincide with the amounts billed to or certified by the customer.
When a performance obligation is satisfied by transferring a promised good or service to the customer before the customer pays consideration or the before payment is due, the Company presents the contract as a contract asset, unless the Company’s rights to that amount of consideration are unconditional, in which case the Company recognises a receivable.
When an amount of consideration is received from a customer prior to the entity transferring a good or service to the customer, the Company presents the contract as a contract liability.
Contract cost assets
The Company recognises assets relating to the costs of obtaining a contract and the costs incurred to fulfil a contract or set up / mobilisation costs that are directly related to the contract provided they will be recovered through performance of the contract.
Costs to obtain a contract
Costs to obtain a contract are only capitalised when they are directly related to a contract and it is probable that they will be recovered in the future. Costs incurred that would have been incurred regardless of whether the contract was won are expensed, unless those costs are explicitly chargeable to the customer in any case (whether or not the contract is won).
The capitalised costs are amortised on a straight line basis over the expected life of the contract.
Set up / mobilisation costs
Costs required to set up the contract, including mobilisation costs, are capitalised provided that it is probable that they will be recovered in the future and that they do not include expenses that would normally have been incurred by the Company if the contract had not been obtained. They are recognised as an expense on the basis of the proportion of actual output to estimated output under each contract. If the above conditions are not met, these costs are taken directly to profit or loss as incurred.
Costs to fulfil a contract
Where costs are incurred to fulfil a contract, they are accounted for under the relevant accounting standard (if appropriate), otherwise if the costs relate directly to a contract, the costs generate or enhance resources of the Company that will be used to satisfy performance obligations in the future and the costs are expected to be recovered then they are capitalised as contract costs assets and released to the profit or loss on an systematic basis consistent with the transfer to the customer of the goods or services to which the asset relates.
Provisions relating to contracts with customers
There are no provisions relating to contracts with customers identified during the year.
Financing component of contracts with customers
There are no significant financing component of contracts with customers identified during the year.
Other income
Other income is recognised on an accruals basis when the Company is entitled to it.
(b) Income Tax
The Company is exempt from income tax under Division 50 of the Income Tax Assessment Act 1997
(c) Goods and services tax (GST)
Revenue, 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 Taxation Office (ATO).
Receivables and payable are stated inclusive of GST. Cash flows in the statement of cash flows are included on a gross basis and the GST component of cash flows arising from investing and financing activities which is recoverable from, or payable to, the taxation authority is classified as operating cash flows.
(d) Inventories
Inventories are measured at the lower of cost and net realisable value.
Inventories acquired at no cost, or for nominal consideration are valued at the current replacement cost as at the date of acquisition, which is the deemed cost.
(e) Property, plant and equipment
Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any accumulated depreciation and impairment.
Items of property, plant and equipment acquired for significantly less than fair value have been recorded at the acquisition date fair value.
Land and
buildings
Land and buildings are measured using the cost model.
Plant and equipment
Plant and equipment are measured using the cost model.
Depreciation
Property, plant and equipment, excluding freehold land, is depreciated on a straight line and reducing balance basis over the asset’s useful life to the Company, commencing when the asset is ready for use.
The depreciation rates used for each class of depreciable asset are shown below:
At the end of each annual reporting period, the depreciation method, useful life and residual value of each asset is reviewed. Any revisions are accounted for prospectively as a change in estimate.
(f) Financial instruments
Financial instruments are recognised initially on the date that the Company becomes party to the contractual provisions of the instrument.
On initial recognition, all financial instruments are measured at fair value plus transaction costs (except for instruments measured at fair value through profit or loss where transaction costs are expensed as incurred).
Financial assets
All recognised financial assets are subsequently measured in their entirety at either amortised cost or fair value, depending on the classification of the financial assets.
Classification
On initial recognition, the Company classifies its financial assets into the following categories, those measured at:
• amortised cost
Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets.
Amortised cost
The Company’s financial assets measured at amortised cost comprise trade and other receivables and cash and cash equivalents in the statement of financial position.
Subsequent to initial recognition, these assets are carried at amortised cost using the effective interest rate method less provision for impairment.
Interest income, foreign exchange gains or losses and impairment are recognised in profit or loss. Gain or loss on derecognition is recognised in profit or loss.
Impairment of financial assets
Impairment of financial assets is recognised on an expected credit loss (ECL) basis for the following assets:
• financial assets measured at amortised cost
When determining whether the credit risk of a financial assets has increased significant since initial recognition and when estimating ECL, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis based on the Company’s historical experience and informed credit assessment and including forward looking information.
The Company uses the presumption that an asset which is more than 30 days past due has seen a significant increase in credit risk.
The Company uses the presumption that a financial asset is in default when:
• the other party is unlikely to pay its credit obligations to the Company in full, without recourse to the Company to actions such as realising security (if any is held); or
• the financial assets is more than 90 days past due.
Credit losses are measured as the present value of the difference between the cash flows due to the Company in accordance with the contract and the cash flows expected to be received. This is applied using a probability weighted approach.
Trade receivables
Impairment of trade receivables have been determined using the simplified approach in AASB 9 which uses an estimation of lifetime expected credit losses. The Company has determined the probability of non
payment of the receivable and multiplied this by the amount of the expected loss arising from default.
The amount of the impairment is recorded in a separate allowance account with the loss being recognised in finance expense. Once the receivable is determined to be uncollectable then the gross carrying amount is written off against the associated allowance.
Where the Company renegotiates the terms of trade receivables due from certain customers, the new expected cash flows are discounted at the original effective interest rate and any resulting difference to the carrying value is recognised in profit or loss.
Other financial assets measured at amortised cost
Impairment of other financial assets measured at amortised cost are determined using the expected credit loss model in AASB 9. On initial recognition of the asset, an estimate of the expected credit losses for the next 12 months is recognised. Where the asset has experienced significant increase in credit risk then the lifetime losses are estimated and recognised.
Financial liabilities
The Company measures all financial liabilities initially at fair value less transaction costs, subsequently financial liabilities are measured at amortised cost using the effective interest rate method.
The financial liabilities of the Company comprise trade payables only.
(g) Impairment of non financial assets
At the end of each reporting period the Company determines whether there is evidence of an impairment indicator for non financial assets.
Where an indicator exists and regardless for indefinite life intangible assets and intangible assets not yet available for use, the recoverable amount of the asset is estimated.
Where assets do not operate independently of other assets, the recoverable amount of the relevant cash generating unit (CGU) is estimated.
The recoverable amount of an asset or CGU is the higher of the fair value less costs of disposal and the value in use. Value in use is the present value of the future cash flows expected to be derived from an asset or cash generating unit.
Where the recoverable amount is less than the carrying amount, an impairment loss is recognised in profit or loss.
Reversal indicators are considered in subsequent periods for all assets which have suffered an impairment loss.
(h) Cash and cash equivalents
Cash and cash equivalents comprises cash on hand, demand deposits and short term investments which are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.
(i) Employee benefits
Provision is made for the Company’s liability for employee benefits, those benefits that are expected to be wholly settled within one year have been measured at the amounts expected to be paid when the liability is settled.
Employee benefits expected to be settled more than one year after the end of the reporting period have been measured at the present value of the estimated future cash outflows to be made for those benefits. In determining the liability, consideration is given to employee wage increases and the probability that the employee may satisfy vesting requirements. Cashflows are discounted using market yields on high quality corporate bond rates incorporating bonds rated AAA or AA by credit agencies, with terms to maturity that match the expected timing of cashflows. Changes in the measurement of the liability are recognised in profit or loss.
Defined contribution schemes
Obligations for contributions to defined contribution superannuation plans are recognised as an employee benefit expense in profit or loss in the periods in which services are provided by employees.
(j) Provisions
Provisions are recognised when the Company has a legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.
Provisions are measured at the present value of management’s best estimate of the outflow required to settle the obligation at the end of the reporting period. The discount rate used is a pre tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the unwinding of the discount is taken to finance costs in the statement of profit or loss and other comprehensive income.
3 Critical Accounting Estimates and Judgments
The directors make estimates and judgements during the preparation of these financial statements regarding assumptions about current and future events affecting transactions and balances.
These estimates and judgements are based on the best information available at the time of preparing the financial statements, however as additional information is known then the actual results may differ from the estimates.
The significant estimates and judgements made have been described below.
Key estimates – impairment of property, plant and equipment
The Company assesses impairment at the end of each reporting period by evaluating conditions specific to the Company that may be indicative of impairment triggers. Recoverable amounts of relevant assets are reassessed using value in use calculations which incorporate various key assumptions.
There are no indicators of impairment during the year.
Key estimates – provisions
As described in the accounting policies, provisions are measured at managementís best estimate of the expenditure required to settle the obligation at the end of the reporting period. These estimates are made taking into account a range of possible outcomes and will vary as further information is obtained.
Key estimates – receivables
The receivables at reporting date have been reviewed to determine whether there is any objective evidence that any of the receivables are impaired. An impairment provision is included for any receivable where the entire balance is not considered collectible. The impairment provision is based on the best information at the reporting date.
4 Revenue and Other Income
5 Finance Income and Expenses
6 Cash and Cash Equivalents
7 Trade and Other Receivables
The carrying value of trade receivables is considered a reasonable approximation of fair value due to the short term nature of the balances.
The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable in the financial statements.
8 Inventories
Write downs of inventories to net realisable value during the year were $NIL (2023: $NIL).
9 Contract Balances
Contract assets and liabilities
The Company has recognised the following contract assets and liabilities from contracts with customers:
(i) Represents members advanced payments received at year end.
10 Property, plant and equipment
BUILDINGS
(a) Movements in Carrying Amounts
Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the current financial year:
11 Intangible Assets
12 Other non-financial assets
13 Trade and Other Payables
Trade and other payables are unsecured, non interest bearing and are normally settled within 30 days. The carrying value of trade and other payables is considered a reasonable approximation of fair value due to the short term nature of the balances.
14 Provisions
- Beef Aust Expo 2023
- Single Step Genetic Improvement -
Provision Beef Aust Expo 2023
The Company incurred a significant amount for organising the Beef Aust Expo 2021. As a result, the Directors have decided to provide an estimate for Beef Aust Expo 2024. The estimate is based on the actual cost incurred for the 2021 event.
15 Employee Benefits
16 Financial Risk Management
17 Members’ Guarantee
The Company is incorporated under the Corporations Act 2001 and is a Company limited by guarantee. If the Company is wound up, the constitution states that each member is required to contribute a maximum of $20 each towards meeting any outstanding obligations of the Company. At 31 March 2024 the number of members was 698 (2023: 673).
18 Key Management Personnel Disclosures
The remuneration paid to key management personnel of the Company is $275,750 (2023: $251,024).
19 Auditors’ Remuneration
20 Contingencies
In the opinion of the Directors, the Company did not have any contingencies at 31 March 2024 (31 March 2023: None).
21 Related Parties
(a) The Company’s main related parties are as follows:
Key management personnel refer to Note 18.
Other related parties include close family members of key management personnel and entities that are controlled or significantly influenced by those key management personnel or their close family members.
(b) Transactions with related parties
There are no transactions with related parties during the year.
(c) Loans to / from related parties
There are no loans to / from related parties during the year.
22 Events after the end of the Reporting Period
No matters or circumstances have arisen since the end of the financial year which significantly affected or may significantly affect the operations of the Company, the results of those operations or the state of affairs of the Company in future financial years.
23 Statutory Information
The registered office and principal place of business of the company is: Droughtmaster Stud Breeders’ Society Limited 40 Thorn Street IPSWICH QLD 4305
Droughtmaster Stud Breeders’ Society Limited For the year ended 31 March 2024
Directors’ Declaration
The directors of the Company declare that:
1. The financial statements and notes, as set out on pages 5 to 23, are in accordance with the Corporations Act 2001 and:
a. comply with Australian Accounting Standards – Simplified Disclosure Standard; and
b. give a true and fair view of the financial position as at 31 March 2024 and of the performance for the year ended on that date of the Company.
2. In the directors’ opinion, there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
This declaration is made in accordance with a resolution of the Board of Directors.
Angus
McCormack, Director
Dated 24 June 2024
Todd Heyman, Director
INDEPENDENT AUDIT REPORT TO THE MEMBERS OF DROUGHTMASTER STUD BREEDERS’ SOCIETY LIMITED
Droughtmaster Stud Breeders’ Society Limited For the year ended 31 March 2024
Report on the Audit of the Financial Report
Opinion
We have audited the accompanying financial report, being a general purpose simplified disclosures financial report of Droughtmaster Stud Breeders’ Society Limited (the Company), which comprises the statement of financial position as at 31 March 2024, the statement of profit or loss and other comprehensive income, the statement of changes in equity and the statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration.
In our opinion, the accompanying financial report of the Company is in accordance with the Corporations Act 2001 , including:
(i) giving a true and fair view of the Company’s financial position as at 31 March 2024 and of its financial performance for the year ended; and
(ii) complying with Australian Accounting Standards to the extent described in Note 1 and the Corporations Regulations 2001
Basis for Opinion
We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of our report. We are independent of the Company in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the financial report in Australia. We have also fulfilled our other ethical responsibilities in accordance with the Code.
We confirm that the independence declaration required by the Corporations Act 2001 , which has been given to the directors of the Company, would be in the same terms if given to the directors as at the time of this auditor’s report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Responsibilities of Directors for the Financial Report
The directors of the Company are responsible for the preparation of the financial report that gives a true and fair view and have determined that the basis of preparation described in Note 1 to the financial report is appropriate to meet the requirements of the Corporations Act 2001 and is appropriate to meet the needs of the members.
The directors’ responsibility also includes such internal control as the directors determine necessary to enable the preparation of a financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.
In preparing the financial report, the directors are responsible for assessing the Company’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s Responsibilities for the Audit of the Financial Report
Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial report.
A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at: https:// www.auasb.gov.au/auditors_responsibilities/ar4.pdf. This description forms part of our auditor’s report.
We also provide the directors with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
