Swan Christian Education Association Inc.
ANNUAL REPORT
15
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CONTENTS
Section One - Annual Report Board Chairman’s Report 4
CEO’s Report 6 Financial Overview 8
Governance 10 Section Two - Financial Statements Director’s Declaration 2 Independent Auditor’s Report 3 Statement of Financial Performance Statement of Financial Position
5 7
Statement of Cash Flows 8 Notes to the Financial Statements
9
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What we stand for Our staff are all committed Christians that hold a worldview in which God is acknowledged as our creator and Jesus Christ is accepted as our Lord.
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CHAIRMAN’S REPORT
Roger Edland Chairman, SCEA Board On behalf of the Board, I thank all of our hard working staff and volunteers who, through God’s strength and grace, are called to work together in Christian education in SCEA. Great things can be achieved when we humble ourselves before Him (Eph 4:2).
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Through God’s blessing, 2015 was a fruitful year of growth and expansion at SCEA. With our mission of partnering with families and communities to provide Christ-centred education at heart, the Association was able to celebrate significant milestones.
Contest at Swan Christian College demonstrated how we can work together to encourage our students to excel. A special thank you to the staff at all of our campuses that reached out to their colleagues to encourage and invite them to participate in joint activities.
Year in Review Expansion Construction of Mundaring Christian College’s new Secondary Campus at Parkerville achieves a long held vision of offering a complete Christian education to families in the Hills and is the first new campus SCEA has opened in five years. The passion of Principal Rod McNeill, the energy of his team, and the efforts of the team at SCEA supporting them has resulted in a fantastic Stage 1 building which almost 200 students are enjoying this year, with many more to follow. 2015 also saw a number of approvals received for Northshore Christian Grammar School, for which enrolment applications opened in late September. It is pleasing to see the number of families enrolling – particularly the number of Christian families, which we attribute to the strong reputation of our existing schools, and the clearly articulated vision for this new campus in Alkimos. Progress towards the launch of the SCEA Institute of Teaching and Learning has also continued strongly, and we look forward to offering Bachelor of Education degrees in partnership with Tabor College of Higher Education from 2017 onwards. Finally, we saw the opening of new facilities across our Association, including a brand new classroom building and revitalised Early Learning space at Kalamunda Christian School.
Continuous Improvement
This year we introduced a new communications tool called the Year in Review. The purpose of this online report is to capture the progress made against the SCEA Strategic Plan Key Result Areas in 2015 with the aim of being transparent and accountable in our operations. Not only is the Year in Review a more timely reflection of the previous year, it also means that the Annual Report is condensed to primarily contain financial and governance obligations. If you haven’t already read the Year in Review, I encourage you to do so by visiting www.scea.wa.edu.au/about/year-in-review
Thank You On behalf of the Board, I thank our CEO, Stephen Lee, his Executive Leadership Team and all our staff for their commitment, hard work and focus throughout the year. Thank you also to our many volunteers who give of their time and make such a valuable contribution to our organisation. Thank you to my fellow Board members for their professionalism and faithful service to God in Christian Education. As we all serve together in our unique Association we must continue to make Christ the centre and focus of our calling and purpose in Christian Education. I pray for God’s continued grace and guidance as we unite together in His service in Christian Education.
2015 was also a year of consolidation and reflection as we seek to continuously improve at all levels. We believe it is imperative to ensure we are honouring our God-given responsibility to provide best-practice governance to our Association. A number of initiatives, including improvements in Risk Management, were identified and will be pursued. A project team of our Principals and staff from the SCEA Institute worked to develop School Improvement Plans to ensure each school is committed and active in their continuous improvement. Additionally, comprehensive reviews of our schools were conducted via surveys to parents, staff and students. The results of these surveys are being worked through with School Leadership, to allow us to improve in 2016 and beyond. Lastly, we were encouraged by the growth in crossschool initiatives that took place. Events such as the Academic All Stars Day at Kalamunda Christian School, and the interschool Foreign Language Performance
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CEO’S REPORT
Stephen Lee Chief Executive Officer
We can all be pleased with how we are advancing our commission of exploring new schools, sites, partnerships, associations, affiliations and developments to increase the opportunity to provide Christ-centred education locally, nationally and globally.
Momentum Over the last year, momentum has been building with the completion of the highly anticipated Secondary Campus of Mundaring Christian College in Parkerville and receipt of Advanced Determination for Northshore Christian Grammar School. Furthermore, we created the SCEA Institute of Teaching and Learning and formalized the agreement with Tabor College of Higher Education to offer tertiary-level teacher training as of 2017. Even the difficult decision to close Geographe Grammar School should be seen as moving forward as we consolidate and focus on a sustainable future for SCEA families. Our progress hasn’t just been in terms of infrastructure and buildings. We are also growing in our ability to attract extraordinary staff to our Association and are particularly pleased with the appointments of new Principal’s Mr. Adrian Scott at Swan Christian College and Mr. Justin Krause at Ellenbrook Christian College and Beechboro Christian School. We are also grateful that leading experts such as Dr. Thelma Perso and Tony Stopher are choosing to work with us. Furthermore, as a body of educators we are continuously improving, as we strive for advances in our NAPLAN and WACE results.
Collaboration In 2015, more than ever before, we have seen an increase
in collaboration and synergy in our teaching and learning. Our SCEA Institute Educational Consultants facilitated sharing of best practice expertise and moved forward with the implementation of the Biblical Foundations Curriculum Framework. Learning programs such as the Science Academy continued and we made plans for access to facilities and courses at the Swan Trade Training Centre for students from all schools. We also saw an increasing number of cross-school events such as SCEAVision, the Language Perfect competition, Choral Fest, the Performing Arts Workshops and All Stars Academic Tournament, all of which are terrific examples of celebrating the unity and diversity within our system of schools. We value the unique and bespoke characters of each of our school communities. At the same time, we are grateful for the fact that God has brought our schools together to offer students greater character developing and team working opportunities.
Final Word It has been an honour to be at the helm of the Association for another year. I sense that collectively we have felt challenged, tested and exhilarated in equal measure. However, hopefully our overriding feeling is one of gratitude to God for keeping us safe, on course and for blessing us with a truly unique Association, in which He has His rightful place as our Lord and Saviour.
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WHAT MAKES SCEA SO UNIQUE? We remain dedicated to the course we are on: to be leaders in ChristCentred Education in WA such as to impact the next generation of children, globally.
2015 was an incredibly positive year for our Association, as projects come to fruition, others commence and we continue to focus on excellence in teaching and learning. We’re achieving a huge range of goals at SCEA.
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FINANCIAL OVERVIEW We received an unqualified audit report for the financial year ended 31 December 2015 with no material required adjustments. We have ended the year ahead of budget and have achieved this through our continued focus on efficiencies and costs savings despite an ever changing economic climate. We have continued our focus in 2015 to strengthen the synergies between schools in both teaching and operations which has resulted in positive results, both financial and non-financial. From a capital expenditure perspective, we have completed and started significant capital projects as noted below. Specifically we have completed phase 1 of the Mundaring Christian College Secondary Campus in Parkerville. The new secondary campus opened it doors as planned for students at the start of Term 1 of 2016. We signed an offer to purchase land for a new school site at Alkimos in Dec 2015
BREAKDOWN OF EXPENDITURE ‐ 2015 Interest & Depr 9%
This report should be read in conjunction with the Annual Financial Statements, available in this Annual Report. 2015 Audited Financial Statements Summary of Financial Performance •
Net operating income surplus for the year is $3,643,720 (2014 - $1,836,067) or 6.25% of total income.
•
Total income is up by 7.8% to $58.3m (2014$54.1m) while total expenditure has also increased by 4.61% to $54.7m (2014 - 52.3m)
•
Staff salaries, wages and related costs continue to amount to approximately 70% of total expenses.
BREAKDOWN OF INCOME ‐ 2015 Other Income 3%
Operational expenses 13%
Other staff costs 7%
for an amount of $5.1m. The planning phase for construction was also completed before 31 Dec 2015, in order for the construction of phase 1 to be completed by end of 2016.
Projects Grants 3%
State Grants 18%
Tuition 34%
Tuition Salaries 54%
Tuition expenses 7% Admin Salaries 10%
Federal Grants 42%
BREAKDOWN OF EXPENDITURE ‐ 2014 Interest & Depr 10%
Other Income 7%
Operational expenses 14%
Other staff costs 8%
BREAKDOWN OF INCOME‐ 2014 Projects Grants 1%
Tuition 33%
State Grants 18%
Tuition Salaries 53%
Tuition expenses 5% Admin Salaries 10%
Federal Grants 41%
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Salaries and related expenses have increased to $37.88m (2014 - $37.18m), an increase of 4.5%. The containment of these costs continues to be one of our greatest challenges going forward. •
State and Commonwealth Grants have increased to $35m (2014 - $31.1m) – an increase of 9.1%.
•
Family tuition fees have increased to $19.8m (2014 - $17.7m) – an increase of 11.7%, which is a combination of inflation increased charges to parents and an increase in enrolments.
•
Other income from grants, canteens, uniforms, transport, and DER has reduced to $2.1m (2014 - $2.7m)
•
Capital expenditure for the year has been $11m (2014 - $5m). This increase is mainly contributed to the construction of the Parkerville campus and initial pre-works costs at Alkimos.
•
The annual depreciation charge has decreased to $3.9m (2014 - $4.3m). This is due to the final year of depreciation for the DER funded equipment that has been replaced with the BYOD implementation.
•
Investment in our receivables, mainly in family debtors, has increased to $3m (2014 - $2.1m).
•
Amounts written off, and provided for by way of bad debts, increased to $319,094 (2014 - $238,591). Included in this amount is the actual amount that have been written off as bad debts to the value of $48,843 (2014 - $37,263).The provision for doubtful debts has increased to $1,227,630 (2014 - $957,379).
•
Special Education Grants have decreased to $1.1m this year (2014 - $1.2m). This is mainly due to funding model changes that have resulted in certain Special Education grants now being included in Commonwealth grants.
•
The combined (current and non-current) long service leave provision has stabilised at $2.6m.
•
Our finance costs have been well contained this year and have shown a further decrease on 2014 of 19% as a result of improved financial management and cash flow management.
As is evident from the above all our costs, including salaries, loan interest, depreciation, maintenance and running costs, have all been tightly managed in the year under review, providing an extremely pleasing result. These financial and non-financial management processes will assist us to maintain fiscal controls for 2016 in a softening economy.
Key Highlights Increase in state and commonwealth grants
9.1% to $35 Million
Staff wages, salaries and costs approx.
70% of total expenses
Capital expenditure for the year
$11 Million
Finance costs (vs 2014)
Reduced by 19%
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BOARD MEMBERS
Roger Edland
Annemie Beck
Clinton Bradbury
Chairman
Director
Deputy Chairman Chairman of Finance Committee
Roger Edland is a Business Consultant working at Woodside Petroleum and was first elected to the SCEA Board in 2008. Roger commenced as Chairman in January 2013. His four children have attended Mundaring Christian College and Swan Christian College. Roger is passionate about Christian education and enjoys working with a group of talented and inspirational people at SCEA.
Annemie Beck is a General Practicioner who was first elected to the SCEA Board in 2013. Married with three children attending Kalamunda Christian School and Swan Christian College, Annemie joined the SCEA Board to help ensure that SCEA stays true to the role of providing quality Christian education.
Clinton Bradbury leads a corporate advisory firm. He first joined the SCEA Board in 2011 and has served as Chairman of the Finance Committee since March 2013, and as Deputy Chairman since July 2014. Clinton sees SCEA as an opportunity to serve God’s kingdom, and enjoys being a part of a board that applies corporate governenance in a professional way, to add value to our schools.
Attendance at Meetings in 2015: 13/13
Attendance at Meetings in 2015: 12/13
Attendance at Meetings in 2015: 13/13
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Daniel Bredenkamp
Neil David
Natalie Leitão
Director
Director
Director
Daniel was first elected to the SCEA Board in 2011 and is an Executive Director at Pitcher Partners Accountants, Auditors and Advisors. Daniel joined the SCEA Board for the opportunity to have input in to the direction of an organisation with enormous potential to affect and shape Christian education in Perth, Australia, and potentially overseas.
Neil David joined the SCEA Board in 2015, being elected at the AGM in June. With three daughters at Ellenbrook Christian College, Neil has always been interested in their education and saw being part of the Board as an opportunity to make a larger contribution not only to their lives, but to many more. He enjoys working with like-minded Christians from different walks of life who bring diversity of experience to the challenges we face at SCEA.
Natalie Leitão was first elected to the SCEA Board in 2013, having been involved in teacher education, curriculum development and research throughout her career. Natalie is committed to Christian education and has used her teaching background at the Board level while continuing to seek God’s direction for SCEA.
Attendance at Meetings in 2015: 13/13
Attendance at Meetings in 2015: 5/5
Attendance at Meetings in 2015: 13/13
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BOARD DECLARATIONS The following declarations from SCEA Board Members, indicating conflicts of interest or potential conflicts of interest with their role as a director of Swan Christian Education Association Inc., are held on file.
Annemie Beck • • • •
Two children at Swan Christian College One child at Kalamunda Christian School Childrens’ godmother is the Principal at Kalamunda Christian School Friends with multiple staff members at Kalamunda Christian School and Swan Christian College
Clinton Bradbury • • • • •
Three children at Ellenbrook Christian College Chairman of DVG Automotive Group Director of Australian Aquisition Services Pty Ltd Director of Kings Global Advisory Pty Ltd Director of MG Kailis Group
Daniel Bredenkamp •
One child at Ellenbrook Christian College
Guy Cameron (Board Member to 2015 AGM) •
As a sole trader, or in partnership with others, may provide goods or services to SCEA through Wallmount Photography
Neil David (Board Member from 2015 AGM) •
Three children at Ellenbrook Christian College
Roger Edland •
Two children at Swan Christian College
Natalie Leitão • •
Works casual hours for Edith Cowan University, Morling College & Sheridan College Relief teacher at Landsdale Christian School
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Swan Christian Education Association Financial Statements
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Directors Declaration
In the opinion of the Board of Swan Christian Education Association Inc: 1. The accompanying special purpose accounts of the Association are drawn up so as to give a true and fair view of the results of the Association for the year ended the 31st December 2015 and the state of affairs of the Association at that date. 2. A t the end date of this statement there are reasonable grounds to believe that the Association will be able to pay its debts as and when they fall due. 3. The Directors have resolved not to revalue the land and buildings this year. This declaration is made in accordance with a resolution of the Board of Directors. On behalf of the Board by resolution of the Directors.
President - Mr Roger Edland
Chief Executive Officer - Stephen Lee Date : 24 March, 2016
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Independent Auditor's Report To the Members of Swan Christian Education Association Inc. We have audited the accompanying financial report, being a special purpose financial report of Swan Christian Education Association Inc. (“the Association”), which comprises the statement of financial position as at 31 December 2015, the statement of financial performance and statement of cash flows for the year then ended, notes comprising a summary of significant accounting policies and other explanatory information, and the directors declaration on the annual statements giving a true and fair view of the financial position and performance of the Association.
Directors’ Responsibility for the Financial Report The directors of the Association are responsible for the preparation and fair presentation of the financial report, and have determined that the basis of preparation described in Note 1 is appropriate to meet the requirements of the Associations Incorporation Act 1987 (WA) and is appropriate to meet the needs of the members.
The directors’
responsibility also includes such internal control as the Board determines is necessary to enable the preparation and fair presentation of a financial report that is free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the association’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the association’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
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Independent Auditor’s Report
To the Members of Swan Christian Education Association Inc. (Continued)
Opinion In our opinion the financial report presents fairly, in all material respects, the financial position of Swan Christian Education Association Inc. as at 31 December 2015 and of its financial performance for the year then ended in accordance with the accounting policies described in Note 1 to the financial statements, and the requirements of the Associations Incorporation Act 1987 (WA).
Basis of Accounting and Restriction on Distribution Without modifying our opinion, we draw attention to Note 1 to the financial statements, which describes the basis of accounting. The financial report has been prepared to assist Swan Christian Education Association Inc to meet the requirements of the Associations Incorporation Act 1987 (WA). As a result, the financial report may not be suitable for another purpose.
BENTLEYS Chartered Accountants
DOUG BELL CA Director
Dated at Perth this 31st day of March 2016
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Statement of Financial Performance for the year ended 31 December 2015
NOTE
2015
2014
$
$
INCOME Families income inc Tuition fees
19,784,753
17,711,808
216,567
255,144
2,138,239
2,715,463
Profit on Sale of Assets
16,465
1,063
Rental Income
90,710
88,332
1,054,104
1,225,284
State & Commonwealth Grants
35,037,011
32,117,465
TOTAL INCOME
58,337,849
54,114,559
29,412,441
27,820,764
3,789,659
2,772,220
33,202,100
30,592,984
Administration Salaries
5,649,532
5,136,766
Admin, computers, bank, cleaning & security
1,663,490
1,476,509
Maint / Grounds & Cleaning Wages & Exp
2,429,843
2,518,986
297,184
177,194
62,217
71,324
3,893,293
4,311,703
Doubtful Debt expense
319,094
238,591
Insurance General
298,628
345,489
Light, Rates, Water & Telephone
830,353
795,674
Long Service Leave
571,061
610,094
20,934
9,633
319,193
344,903
3,823,815
4,143,492
Subscriptions
164,776
151,380
Transport, Motor Vehicle & Travel
403,233
437,142
20,746,646
20,768,880
704,176
864,857
32,654
46,498
736,830
911,355
54,685,576
52,273,219
Interest Income Other net income
3
Special Educational Grants
EXPENDITURE Tuition Salaries Tuition Expenses
Administration & General
Advertising Staff and Marketing Audit and other Professional fees
4
Depreciation
OH&S expenses Printing, Stationery & Office Super, Staff expenses and WCA
5
Finance Interest Rent- Leased Properties
TOTAL EXPENDITURE
This Statement of Financial Performance should be read in conjunction with the accompanying notes. Swan Christian Education Association Inc.
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Statement of Financial Performance for the year ended 31 December 2015 (continued)
NOTE Assets scrapped NET OPERATING SURPLUS FOR THE YEAR
2015
2014
$
$ 8,553
5,273
3,643,720
1,836,067
1,590,603
270,000
1,590,603
270,000
5,234,323
2,106,067
NON-OPERATING ACTIVITIES Capital Grants Received Federal government funding - CGA Capital Grant
NET SURPLUS FOR THE YEAR TRANSFERS FROM / (TO) RESERVES AND FUNDS Transfer to Capital Contributions
12
(1,590,603)
(270,000)
Transfer from / (to) Family Hardship Fund
16
6,450
(7,666)
Transfer from / (to) Project Development Fund
20
429,607
(509,904)
4,079,777
1,318,497
NET SURPLUS TRANSFERRED
This Statement of Financial Performance should be read in conjunction with the accompanying notes. Swan Christian Education Association Inc.
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Statement of Financial Position for the year ended 31 December 2015
NOTE
2015
2014
$
$
CURRENT ASSETS Cash at Bank
6
6,958,880
3,497,734
Receivables
7
2,270,997
1,518,120
185,412
181,933
9,415,289
5,197,787
80,244,917
73,145,250
TOTAL NON-CURRENT ASSETS
80,244,917
73,145,250
TOTAL ASSETS
89,660,206
78,343,037
Stock TOTAL CURRENT ASSETS NON-CURRENT ASSETS Property, Plant & Equipment
8
CURRENT LIABILITIES Payables
21
3,809,479
3,493,002
Provisions - Current
9
2,029,449
1,822,212
-
8,887
2,042,745
1,865,922
7,881,673
7,190,023
Funds received in advance Loans payable within 12 months
10
TOTAL CURRENT LIABILITIES NON-CURRENT LIABILITIES Provisions - Non-Current
9
1,754,051
1,960,629
Loans
11
19,375,579
13,018,199
TOTAL NON-CURRENT LIABILITIES
21,129,630
14,978,828
TOTAL LIABILITIES
29,011,303
22,168,851
NET ASSETS
60,648,903
56,174,186
Represented by: Capital Contributions
12
17,058,136
16,312,383
Accumulated Surplus
13
29,791,495
25,711,718
School councils
14
291,450
210,113
Building / Library Fund
15
588,606
584,699
Family Hardship Fund
16
123,164
129,614
School Development Fund
20
824,127
1,253,734
Revaluation Reserve Account
17
11,971,925
11,971,925
60,648,903
56,174,186
NET EQUITY
This Statement of Financial Position should be read in conjunction with the accompanying notes. Swan Christian Education Association Inc.
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Statement of Cash Flows for the year ended 31 December 2015 2015
2014
$
$
Cash Flows From Operations Receipts from student fees
18,561,167
17,228,909
Grants received recurrent
36,091,115
33,342,749
1,622,566
906,986
220,239
258,816
(49,935,473)
(46,359,429)
(704,176)
(849,489)
5,855,438
4,528,542
1,590,603
270,000
3,907
10,268
(165,639)
(118,995)
619,130
509,904
(10,992,960)
(5,063,106)
16,463
1,063
(8,928,496)
(4,390,866)
Repayment of borrowings
(1,165,796)
(3,557,915)
Proceeds from borrowings
7,700,000
684,052
Net Cash Flows From / (Used in) Financing
6,534,204
(2,873,863)
NET CASH FLOWS
3,461,146
(2,736,187)
Opening Balance
3,497,734
6,233,921
Net Cash Flows
3,461,146
(2,736,187)
Closing Balance
6,958,880
3,497,734
Other income Interest Received Payments to suppliers and employees Interest and borrowing costs paid Net Cash Flows From Operations Cash Flows From Investing Activities Funding other projects - Government Grants Fund donations received Enrolment Bonds received / (refunded) Non refundable endowment & building fund Acquisition buildings of plant and equipment Proceeds on sale of assets Net Cash Flows (Used in) Investing Cash Flows From Financing Activities
Cash Position
This Statement of Cash Flows should be read in conjunction with the accompanying notes. Swan Christian Education Association Inc.
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Notes to the financial statements for the year ended 31 December 2015 1. Summary of significant Accounting Policies These special purpose accounts reflect the activities of the Swan Christian Education Association (Inc). The accounts incorporate the following schools and colleges: Southern Hills Christian College Beechboro Christian School Ellenbrook Christian College Geographe Grammar School
Mundaring Christian School Swan Christian College - Junior School Campus Swan Christian College Kalamunda Christian School
The Association is not a reporting entity because in the opinion of the directors there are unlikely to exist users of the financial report who are unable to command the preparation of reports tailored so as to satisfy specifically all of their information needs. Accordingly, these special purpose financial statements have been prepared to satisfy the directors’ reporting requirements under the Association’s constitution and the Associations Incorporation Act 1987 (WA) and are prepared in accordance with the accounting policies below. a) Basis of Preparation. The accounts are prepared in accordance with the historical cost convention on an accrual basis. Except where otherwise stated accounting policies are consistent with those of the previous year. b) Income Tax. Swan Christian Education Association Inc is exempt from payment of income tax under section 23(2) of the Income Tax Assessment Act. c) Property, Plant and Equipment Land is stated in the statement of financial position at their revalued amounts, being the fair value at the date of revaluation (with the exception of Geographe Grammar school which is measured at cost). Revaluations are performed by independent valuers. Any revaluation movements arising on the revaluation of land are recognised in the revaluation reserve. Land is not depreciated. Site Date of valuation adopted in financial report Swan Christian College 22-July-2009 Swan Christian College - Junior School Campus 22-July-2009 Kalamunda Christian School 31-December-2005 Mundaring Christian School 31-December-2005 Southern Hills Christian College 31-December-2005 Ellenbrook Christian College 31-December-2005 Padbury Terrace (Association Office) 31-December-2005 Plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses. Depreciation is recognised so as to write off the cost of assets less their residual values over their useful lives, using the straight-line method. The estimated useful lives, residual values and depreciation method are reviewed at the end of each reporting period, with the effect of any changes in estimate accounted for on a prospective basis. Properties in the course of construction are carried at cost. Depreciation for these assets, on the same basis as other property, commences when the assets are ready for their intended use.
Swan Christian Education Association Inc.
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Notes to the financial statements for the year ended 31 December 2015 (continued) Depreciation The following Depreciation rates have been applied to calculate the charge for the year: Buildings Constructed:- i) Buildings 2.5% ii) Auxiliary structures (shade structures, gazebos etc.) 20% Transportables 10% Plant & Machinery 10% Furniture and Equipment Furnishings (desks, chairs, cabinets, shelving etc.) 10% Music equipment 20% Computers 25% Motor Vehicles All vehicles 20% Low value Assets 33.3% d) Inventories The uniform inventory is valued at the lower of cost and net realisable value. e) Employee Entitlements Liabilities for annual leave are recognised, and are measured as the amount unpaid at the reporting date at current pay rates in respect of employees’ services up to that date. A liability for long service leave is recognised, and is measured at the current value of leave owing to the respective employees. The calculation has been made for all employees on a pro-rata basis (excluding the first two years) of the long service in terms of their Enterprise Bargaining Agreement of SCEA Inc - and non-teaching staff. No consideration is given to future wage rates and salary levels. f) Provision for Doubtful Debts and Bad Debts written off A provision for doubtful debts is made on overdue debtors and bad debts are only written off where it is confirmed that these will not be received. g) Security Arrangements The Bank overdraft and Bank loans disclosed in notes 10 and 11 are secured by mortgages over the fixed property of the Association. h) Going Concern The financial statements have been prepared on a going concern basis. The Board believes this basis is appropriate because the Association has adequate finance facilities in place as disclosed in Note 19 to cover timing differences. Some provisions and funds received in advance are also included in current liabilities.   i) Library stock The library stock was last valued in 2009. Any purchases since then are fully depreciated in the year of acquisition.
Swan Christian Education Association Inc.
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Notes to the financial statements for the year ended 31 December 2015 (continued) j) Revenue Tuition Fees Tuition fees are recognised in the period of tuition by the Association. Tuition fees received in advance are recognised as unearned income liability, until such point that the tuition is rendered. Government Grants Revenue from grants received for operational purposes from Government funding organisations is recognised when the Association obtains the right to receive the revenue, when it is probable that economic benefits will flow to the Association and when it can be measured reliably. Grant revenue is deferred as a liability to the extent that unspent grants may be required to be repaid to the funding organisations or utilised against future expenditure. Interest Income Interest income is recognised on an accrual basis taking into account the interest rate applicable to the financial assets. k) Receivables Tuition receivables are measured at cost. Tuition receivables are assessed for indicators of impairment at the end of each reporting period. A separate provision for doubtful debts is recognised for any estimated loss from collection of tuition receivables. When a tuition receivable is considered uncollectible, it is written off against the provision for doubtful debts account. l) Other Financial Liabilities Other financial liabilities, including borrowings and trade and other payables, are initially measured at fair value, net of transaction costs. Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis. m) Capital Contributions Fund Capital grants received by the Association in excess of $100,000 relating to the acquisition of fixed assets are included in equity as capital contributions in order to recognise the income over the useful life of the asset and thereby correctly matching the revenue with the expenditure over this period. These contributions are credited to income over the expected useful life of the related assets on a straight line basis. Capital grants received by the Association which are less than $100,000 relating to the acquisition of fixed assets are credited to the income statement. n) School Council, Building / Library Funds & Family Hardship Fund School Council funds are administered by the schools and the funds are raised to facilitate projects out of the normal school curriculum and the funds are allocated accordingly. The Building / Library funds are accumulated from donations made by members and staff of the Association to fund future building projects. The family hardship fund was established to assist families with financial hardship to continue their enrolments by making a contribution to tuition fees.  
Swan Christian Education Association Inc.
S2-11
Notes to the financial statements for the year ended 31 December 2015 (continued)
2.
3.
$
$
Canteens
603,528
687,272
Uniforms
120,512
33,761
85,966
145,747
(17,307)
(50,366)
2,045,032
2,624,370
24,548
(4,288)
2,138,239
2,715,463
Fee for audit
39,669
40,165
Other surveys - Parent, staff, payglobal & feasibility studies
22,548
31,159
62,217
71,324
5,908,349
2,316,327
Building Fund
567,534
565,959
Family hardship and bonds
127,477
123,907
50,186
61,972
240,183
146,429
65,151
283,140
6,958,880
3,497,734
3,041,067
2,088,856
(1,227,630)
(957,379)
6,926
5,801
450,634
380,842
2,270,997
1,518,120
Other Net Income Uniform Shops Other income (incl. donations, hire, capital grants and fundraising) Income from Canteens
5.
2014
Gross income
Transport
4.
2015
Audit and Professional Fees
Staff Related Expenses The major items included in Staff Expenses are Superannuation $3,397,173 (2014 - $3,166,289) and Workers Compensation and Income Protection $244,955 (2014 - $816,002)
6.
Cash Assets General Funds
Library Fund School Accounts Term Deposits Funds invested
7.
Receivables Debtors- Tuition Provision for bad and doubtful debts Debtors - Sundry Prepaid Expenses
Swan Christian Education Association Inc.
S2-12
Notes to the financial statements for the year ended 31 December 2015 (continued)
8.
2015
2014
$
$
Property, Plant & Equipment Freehold Land and Buildings & Improvements Swan Christian College Buildings & Improvements - At Cost
19,864,297
19,852,443
Less: Accumulated Depreciation
(4,588,671)
(3,945,789)
5,748,317
5,748,317
21,023,943
21,654,971
3,581,774
3,555,694
(1,100,076)
(966,852)
1,991,862
1,991,862
4,473,560
4,580,704
7,027,632
6,328,820
(1,177,892)
(1,043,489)
830,000
830,000
6,679,740
6,115,331
6,397,610
6,352,198
(1,539,148)
(1,317,814)
400,000
400,000
5,258,462
5,434,384
4,076,888
4,067,026
(1,506,831)
(1,204,734)
2,570,057
2,862,292
5,466,784
5,466,784
(1,663,073)
(1,492,405)
900,000
900,000
4,703,711
4,874,379
Land - Valuation 22 July 2009 Swan Christian College - Junior School Campus Buildings & Improvements - At Cost Less: Accumulated Depreciation Land - Valuation 22 July 2009 Kalamunda Christian School Buildings & Improvements - At Cost Less: Accumulated Depreciation Land - Valuation 31 December 2005 Mundaring Christian College Buildings & Improvements - At Cost Less: Accumulated Depreciation Land - Valuation 31 December 2005 Beechboro Christian School (The land is held on a 20 year lease from the Cracovia club.) Buildings & Improvements - At Cost Less: Accumulated Depreciation Southern Hills Christian College Buildings & Improvements - At Cost Less: Accumulated Depreciation Land - Valuation 31 December 2005
Swan Christian Education Association Inc.
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Notes to the financial statements for the year ended 31 December 2015 (continued)
8.
2015
2014
$
$
Property, Plant & Equipment (continued) Ellenbrook Christian College Buildings & Improvements - At Cost
13,333,368
13,249,064
Less: Accumulated Depreciation
(2,778,512)
(2,413,829)
2,100,000
2,100,000
12,654,856
12,935,235
Buildings & Improvements - At Cost
875, 635
875,635
Less: Accumulated Depreciation
(258,489)
(237,944)
1,200,000
1,200,000
1,817,146
1,837,691
Land at cost
2,202,931
2,202,931
Works in Progress - Buildings & Improvements - At Cost
9,113,093
1,282,988
11,316,024
3,485,919
Land - at cost
334,747
334,747
Buildings & Improvements - At Cost
313,304
280,843
(7,803)
(314)
640,248
615,276
Buildings & Improvements - At Cost
4,614,122
4,590,222
Plant and equipment - At cost
1,292,494
1,292,494
(810,490)
(566,075)
5,096,126
5,316,641
Deposit for land purchase
100,000
-
Capitalised Professional and Architect Fees
455,660
-
555,660
-
Land - Valuation 31 December 2005 Padbury Terrace (Association Office)
Land - Valuation 31 December 2005 Mundaring Christian College - Parkerville Campus
Geographe Grammar School
Less: Accumulated Depreciation Trade Training Centre
Less: Accumulated Depreciation
Northshore Christian Grammar School
Swan Christian Education Association Inc.
S2-14
Notes to the financial statements for the year ended 31 December 2015 (continued)
8.
2015
2014
$
$
Property, Plant & Equipment (continued) Other Assets Plant & Machinery - At Cost
492,135
383,848
(109,700)
(73,853)
382,435
309,995
9,499,695
9,137,179
(8,186,653)
(7,984,859)
1,313,042
1,152,320
Furniture & Equipment- At Cost
5,618,632
5,140,829
Less: Accumulated Depreciation
(4,102,408)
(3,728,774)
1,516,224
1,412,055
441,516
315,982
(197,833)
(168,813)
243,683
147,169
786,546
1,164,612
(786,546)
(753,724)
-
410,888
80,244,917
73,145,250
821,046
636,632
67,200
48,000
Annual leave
751,481
737,580
General Provisions
389,722
400,000
2,029,449
1,822,212
1,754,051
1,890,391
-
70,238
1,754,051
1,960,629
Less: Accumulated Depreciation
Computer Hardware & Software - At Cost Less: Accumulated Depreciation
Motor Vehicles - At Cost Less: Accumulated Depreciation
Library stock - At valuation Less: Accumulated Depreciation
Total Property, Plant & Equipment 9
Provisions Current Liability Long service leave - Current Executive study leave
Non-Current Liability Long Service Leave Work cover
Swan Christian Education Association Inc.
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Notes to the financial statements for the year ended 31 December 2015 (continued)
10
2014
$
$
Loans Payable Within 12 Months Commercial Bank Loans and leases - Current
451,600
928,653
1,591,145
937,269
2,042,745
1,865,922
10,252,667
6,619,932
9,122,912
6,398,267
19,375,579
13,018,199
16,312,383
17,450,260
Capital Grants received
1,590,603
270,000
Depreciation recouped
(844,850)
(1,407,877)
17,058,136
16,312,383
25,711,718
24,393,221
4,079,777
1,318,497
29,791,495
25,711,718
291,450
210,113
584,699
574,431
3,907
10,268
588,606
584,699
Opening Balance
129,614
121,948
Current year assistance
(12,200)
(3,000)
5,750
10,666
123,164
129,614
State Government Low Interest Loans - Current 11
2015
Loans Long Term Loans Commercial Bank Loans and leases State Government Low Interest Loans
12
Capital Contributions Fund Opening Balance
13
Accumulated Funds Opening Balance Net Surplus for the year
14
School Council funds Net balances at year end
15
Building / Library Fund Opening Balance Net Contributions/(Distributions)
16
Family Hardship Fund
Current year transfers less assistance This fund has been established to assist families in financial hardship
Swan Christian Education Association Inc.
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Notes to the financial statements for the year ended 31 December 2015 (continued)
17
2014
$
$
Revaluation reserve Opening balance
11,971,925
11,971,925
-
-
11,971,925
11,971,925
1,253,734
743,830
619,130
509,904
(1,048,737)
-
824,127
1,253,734
Payables and accruals
2,727,881
2,129,191
Families, bonds and outside funds
1,081,598
1,363,811
3,809,479
3,493,002
Revaluations during the year 18
2015
Capital Commitments A contract to acquire a new school site at Alkimos was entered into on 23 Dec 2015 for an amount of $5,120,000. The contract settled on 15 Feb 2016.
19
Finance Facilities The Association continues to receive recurrent and capital grants from Commonwealth and State Government funding. In addition, the Association has general bank finance facilities of $18.609m (2014 - $15.666m) in place. This includes an overdraft facility of $1.5m.
20
Project Development Fund Amounts resolved to be appropriated to fund Plus amounts transferred - current year Less amounts appropriated - current year
21
Payables
Swan Christian Education Association Inc.
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This page has been intentionally left blank. Swan Christian Education Association Inc.
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