SDANEWS OFFICIAL MAGAZINE OF THE SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES’ ASSOCIATION, NEW SOUTH WALES BRANCH f spring 2019 fRRP $10.00
are you a young worker, or do you know one? see pages 8-9
WA I T TAKE FIVE
WTF
sda wins for casual workers page 4
working to eliminate harassment pages 7,
12 & 13
SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES’ ASSOCIATION, NSW BRANCH
WWW.SDANSW.ORG.AUFPHONE 131 SDA STREET ADDRESS: Level 3, 8 Quay Street, Sydney NSW 2000 POSTAL ADDRESS: PO Box K230, Haymarket NSW 1240 E-MAIL: secretary@sdansw.asn.au
SDA NEWS EDITOR: Bernie Smith, Level 3, 8 Quay Street, Sydney NSW 2000 Please address all correspondence to “The Secretary”.
UNION OFFICERS: SECRETARY: Bernie Smith ASSISTANT SECRETARY: Robert Tonkli PRESIDENT: Maria Dumycz
ORGANISERS SENIOR OPERATIONS OFFICER: Felicity Smithson OPERATIONS OFFICER: Phil Walker
METROPOLITAN: Anthony Attard, Nick Augimeri, Mary Axiak, Tina Callaghan, Talitha Clarke, Anthony Day, Alex Del Rosario, Nathan Egan, Mary Graham, Matthew Hill, Carol Israel, Anthony Maiatico, Whitney Rizk, Chris Raj, Karl San Pedro, Chris Stefanovski, Joel Tynan, Ben Uphill, Alison Varga, Nathan Beard, Rachael Hoffmann, Alexander Kennedy, Jacinta Moore, Mina Papadopoulos, Pamela Torbey, Josip Blazevic
REGIONAL:
Lower South Coast, Southern Highlands & Canberra: Narelle Atkins, Joe Rebbechi, George Nulley-Valdes n phone 6273 2300 Riverina (Wagga/Albury): Struan Timms n phone 6921 8820 Western NSW (Orange/Dubbo): Louise Buesnell and Loretta Turner (part-time Organiser) n phone 6362 1965 Far North Coast (Ballina/Tweed): Trevor McCosker n phone 6686 4192 Wollongong & Illawarra: Vera Cavanagh and Di Dixon (part-time Organiser) n phone 4228 3611 Mid North Coast and Northern Tablelands Region: Mariusz Werstak and Bridget Sheridan n phone 6650 9950
WAREHOUSING AND MANUFACTURING: LEAD ORGANISER: Joseph Bourke Organisers: John Paul Sialafau, Alex Velickovic
SPECIALISTS INDUSTRIAL OFFICERS: Bernard Govind, Mitchell Worsley, Monica Rose, Aliscia Di Mauro, Rose Ghabache WORKERS’ COMPENSATION OFFICER: Michael Babic WHS OFFICER: Jane Lui COMMUNICATIONS OFFICERS: Michael Walker, Paul Farrugia INFORMATION OFFICERS: Georgina Psillis, David Uzzell, Renee Jaajaa, Jessica Chidiac, Effie Toumbas, Corrine Boyle, Nadia Olic EDUCATION OFFICER: Philippe LeCompte
together we are stronger Together, we work to make things better in our workplaces, whether it’s better pay, better treatment or better, more secure jobs. Together, we also work to ensure members get everything you’re entitled to under your Agreements or legislation. Together, we get results. Better pay Pay rises of 3% from the Union’s win in the Fair Work Commission have now flowed into many Agreements and the Award. The SDA has also negotiated a number of pay rises in companies awaiting a new Agreement. Further pay rises for casuals apply from 1 October, with increases to evening and Saturday penalty rates. We won these increases to ensure that casuals receive fairer penalty rates that will be increased in instalments to the same amounts as full-time and part-time employees (see page 4). Know your rights – get your rights It’s one thing to know your rights, but it is another thing to enforce them. Making sure you get what you’re entitled to is the SDA member advantage. Together we ensure that members:
Get paid all your allowances (see page 15); u Get permanent, secure work or more hours (see page 4); u Get your superannuation (see page 15); u Get all your Agreement entitlements, particularly salaried members at Woolworths returning to the Agreement (see page 19). u
If you have a question about your rights, the SDA is here for you. Sometimes a workmate who hasn’t joined the SDA yet, who thinks they get it all, doesn’t really know what they are missing out on. When you’re an SDA member, you have got a friend in the workplace looking out for you and your rights.
Respect Together, we are also working to ensure retail, fast food and warehouse workers are treated with respect at work. We have made progress on addressing customer abuse (see page 7) with some exciting trials, and a commitment from the industry as a whole to change customer behaviour. There is so much more to do, but I thank the wonderful members who have been involved in the trials and in speaking publicly to shine a light on the problem. The SDA has also partnered with the Australian Human Rights Commission to fight sexual harassment in our industries. The levels are too high and must be addressed. Employers need strategies to prevent harassment, and systems where employees feel comfortable to report problems to be addressed (see page 13). On a positive note the SDA — the Models Union — has had a win for models that will hopefully reduce harassment and improve models’ privacy and comfort at work. For the first time, models at Fashion Week shows had private changing areas after the SDA called for this necessary workplace right (see page 12).
And we have introduced a new service to members who have questions about work visas that we hope you find useful, make you feel more secure and give you a voice at work: the Visa Assist program (see page 6). Up to 1 in 10 workers in Australia are working on a form of working visa. Visa Assist provides free and unbiased advice to all our members who have any question on visas. If you feel more secure at work, you are more likely to speak up and ensure you get your workplace rights — and that is a good thing for all our members.
Workplace Issues – Workplace Delegates a Key The retail industry is undergoing a lot of change. This is leading to changes in our workplaces, whether it is roster changes or new ways of doing work. A big thank you to all of our workplace SDA Delegates for taking up all the issues in your workplaces for our members. You really are a friend in the workplace when our members need it most. If your workplace doesn’t have an SDA Delegate, talk to your local SDA Organiser about how we can get a local team working for you. As we gear up for the Christmas season, don’t forget the SDA is with you at work, because together we get results.
Bernie Smith, Branch Secretary SDA NEWS f spring 2019 f PAGE 3
SDA wins pay increases for Casuals How often do you hear a worker say “I’m just a casual”? When you join the SDA, you’re not “just a casual”, you’re a member of by Bernie Smith, Branch Secretary the SDA. The SDA is always working to improve the pay and job security of casual employees, because casuals have rights too. We have recently had a few wins for casuals.
Casual Penalty Rates Increase 1 October The SDA has won higher penalty rates on Saturdays and weeknights for casual employees. The SDA won this in a case
before the Fair Work Commission (FWC). The increase is being phased in over three years. On 1 October, casual penalty rates in the Award and many SDA Agreements will increase by 5%: These new rates are: Before From 1 October 1 October
Weeknights after 6pm +30% +35% Saturdays +40% +45% More increases will occur in 2020 and 2021. Casuals are an important part of the retail industry and an important part of the SDA. Getting fair wages for casual workers is good for them and also means their pay rate doesn’t unfairly undercut permanent pay rates too. Remember, if you’re a casual employee, it pays to belong to the SDA.
success stories by Carol Israel, Organiser
The new rights that the SDA has won for regular casuals to convert to permanent work is great, but it is only words on paper unless you are part of a strong Union with workplace Delegates to help you enforce your rights. Here are two success stories of casual conversion achieved with the assistance of SDA Delegates: 1 SDA Delegate Donna assisted a member with this new right. The SDA member had been a casual for more than 12 months and was a single mum. She had been requesting part-time employment for some time with no success. She approached Donna and together they had a meeting with management. The member was offered a part-time contract of 15 hours per week the next day. The member was delighted. Another reason why casuals should be in the SDA and why SDA Delegates are awesome! 2 SDA member Natalie (shown with me in picture on right) has been working an average of 19.5 hours per week for the past 12 months. A new clause in her Agreement allows part-time employees to make requests to have their contract hours increased annually to reflect the hours they’ve been working. Natalie’s contract hours still said 10 hours per week. After I got involved, her new contract is now 19.5 hours per week. Another reason to belong to the SDA! PAGE 4 f spring 2019 f SDA NEWS
Casual work security The SDA and the ACTU have also won a case in the Fair Work Commission, to give casuals stronger rights. If you are a casual with 12 months or more service and have been getting regular hours, you can now make a request to your employer asking for permanent employment. Your employer must respond to your request in writing within 21 days. Your employer can only refuse if they give you a proper reason. They can’t just say “needs of the business”. This new rostering right is being included in SDA Agreements as they are re-negotiated. The SDA is working hard for casuals. Because you’re not “just a casual”, you’re an SDA member.
SDA continues Bargaining With the help of our Delegates, the SDA continues to work within the enterprise bargaining framework to by Robert Tonkli, deliver a range of Assistant Secretary new Agreements for members that contain higher wages and better conditions. A recent report released by the AttorneyGeneral’s Department shows that bargaining is still delivering results for Australian workers, and that the SDA has been instrumental in the growing number of workers covered by new Agreements. For example: Despite widespread wage stagnation, workers on Enterprise Agreements are receiving wage increases well above inflation (2.7% vs 1.3% on average).
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The pay rises in most new SDA retail Agreements are now linked to the Fair Work Commission’s Annual Wage Review decision.
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This year, the Fair Work Commission determined a pay increase of 3% to all Awards. This is more than double the rate of inflation.
This outcome was only possible because the SDA (and other Unions) through the ACTU argued for a strong pay increase. In contrast, employer associations were arguing for a small or zero increase.
The number of workers on a current Enterprise Agreement has risen by 19% from a low of 1.76 million workers in September 2017 to 2.1 million workers in March 2019.
u
In the March quarter alone, 367,900 workers had new Agreements approved.
u
Most SDA Agreements contain better
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redundancy provisions. For example, a permanent employee with 10 years or more service is only entitled to 12
Nearly one third of these workers included SDA members at Woolworths Supermarkets and David Jones.
Retail made up a third of the workforce covered by new Agreements.
u
This helped raise private sector Agreement coverage from 1.16 million to 1.31 million workers.
weeks redundancy pay if they are covered by the Retail Award. In many SDA Agreements, a
permanent employee with 6 years’ service is entitled to up to 20 weeks’ redundancy pay. Many SDA Agreements also contain
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There are a number of new proposed Agreements that the Fair Work Commission is yet to approve.
better rostering conditions, longer
Despite our best efforts, these Agreements have been held up because of either the slow processes of the Fair Work Commission, or the intervention of nonUnion bargaining agents.
part-time employees, and better leave
rest pauses, adult rates of pay for 20 year olds, higher minimum hours for entitlements. All of this is only possible through securing new Enterprise Agreements with your employer.
This is a real concern, as it is delaying pay increases for members.
Our ability to secure new Agreements with
Better conditions
a function of our membership: the more
Not only do the new SDA Agreements contain pay increases well above inflation, and hourly rates of pay above the Award, they also contain a range of superior entitlements and conditions compared to the underpinning Awards.
higher pay and better conditions is always members we have, the better pay and conditions we can secure. So thank you to all our Delegates and all our SDA members for the work you have done this year to secure our new Agreements.
While some of these conditions might be taken for granted, they are only made possible through the securing of new Agreements. These conditions include: In most SDA Agreements, workers have an absolute right to refuse to work on a public holiday.
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SDA NEWS f spring 2019 f PAGE 5
New member benefit: Visa Assist by Bernie Smith, Branch Secretary
The SDA is pleased to offer a new benefit to members called Visa Assist.
theft, harassment or exploitation because they fear that their visas might be cancelled. It is important that all workers have a voice free from fear.
Up to one in ten workers in Australia are working on a visa.
Unions often do not have in-house expertise on immigration issues so we are happy to announce that, through Unions NSW, we have set up a referral arrangement for SDA members who need advice on any matter relating to visas and immigration, including:
Many workers on visas feel vulnerable in their workplaces — they’re afraid to speak up about wage
Student visas u Partner visas u Carer visas u Working holiday visas u Refugee and humanitarian visas SDA members can access this service at no cost. Advice can be given over the telephone or in person, and interpreters are available. All advice is free and confidential. Call us on 131 732 if you would like to set up an appointment. u
Are you working in Australia on a visa? Do you feel as if you are being treated unfairly at work but are scared that your visa may be affected if you speak up? We provide free and confidential visa advice to Union members working in Australia. If you are working on a visa, you need to be an SDA Union member.
PAGE 6 f spring 2019 f SDA NEWS
industry joins us to tackle abuse On Tuesday 30 July 2019, the SDA hosted a second Roundtable with the National Retail Association (NRA) and the Australian Retailers Association (ARA) to tackle the customer abuse epidemic in retail and fast food outlets across the country. The National Customer Abuse & Violence Industry Roundtable brought together by Jane Lui, WHS Officer major employers, industry peak bodies, NGOs and government organisations from across Australia to discuss how we can prevent retail and fast food workers from being abused on the job. The Roundtable heard directly from a panel of SDA members working in retail and fast food about their experiences. The stories shared by Michelle F, Kiran, Michelle H and Christine were powerful and resonated strongly with all Roundtable participants.
Progress on customer abuse and violence The SDA conducted research in 2017 and 2018 revealing the widespread abuse from customers being experienced by both retail and fast food workers. This year the SDA, in partnership with the Australian Human Rights Commission (AHRC) has undertaken further research in relation to sexual harassment, including harassment perpetrated by customers. Since the first Roundtable in March 2018, the SDA together with industry has made significant progress towards raising awareness about, and reducing the risk of, customer abuse including: u SDA consultation with employers and launch of the Don’t Bag Retail Staff advertising campaign, calling on customers not to take out their frustrations on workers arising from the bans on single-use plastic bags. u Working with employers on their specific policies and training. u Running a new SDA fast food specific advertising campaign raising awareness about abuse of fast food workers, and what we have been doing to address the problem.
Safety Demands Action Week 2019
The SDA briefing Federal and State Members of Parliament and Senators about the issue. u Carrying out a literature review on solutions for occupational violence in the retail and fast food industries. u Implementing a NSW-based trial in some KFC and Reject Shop stores for solutions to tackle customer abuse and violence. u Meeting with relevant State and Territory agencies including police and government safety regulators. u Partnering with the AHRC for an in-depth retail and fast food industries survey on the prevalence and impact of customerperpetrated sexual harassment. u
Industry Statement supporting eradication of customer abuse and violence The SDA was joined by the NRA and ARA in asking employers and stakeholders to make a commitment to a zero-tolerance approach to customer abuse and violence by signing up to an industry statement by 31 August 2019 (see below).
COMING SO O
N
This year, Safety Demands Action week is back again nationwide as the SDA focuses on your health and safety at work. Through our ‘No One Deserves A Serve’ campaign we will be creating awareness about the impact of abusive and violent customer behaviour on retail and fast food workers. Keep an eye out for Safety Demands Action week actions and activities in October! SDA NEWS f SPRING 2019 f PAGE 7
YOUNG WORKERS:
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You h there to you Supervising a Young Worker? If you supervise or work with young workers, you have to remember that they have have no, or limited, work experience. They may not understand the risks of what they are doing, or know how to protect themselves from injury, both physical and psychological. By spending time to train, coach and supervise young workers properly from their first day in the job, you can keep them safe. Young workers need more support and supervision at work to ensure they are carrying out their tasks safely, especially while they’re learning. Keep checking in to ensure they are still performing their tasks correctly as they may not speak up if they need help. If you manage or supervise a young worker, you have a legal obligation under work health and safety laws to protect them from incidents.
PAGE 8 f spring 2019 f SDA NEWS
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ERS: WAIT! TAKE FIVE. If you think a task is unsafe… WTF: Wait! Take Five. Did you know that thousands of workers aged up to 25 years old by Karl San Pedro are injured at work Organiser each year? While some injuries are temporary, others are irreversible and life-changing. This can affect not just the young worker, but their family and friends as well. If you’re a young worker, it’s important that you know your workplace health and safety rights and obligations. Rights for all workers, including young workers…
If they continue to insist that you do the unsafe task, call us immediately. Tell your manager you feel that it’s unsafe to do that task, but that you are able to complete other tasks (if they are safe!) that you are trained to do. You also have the right to raise safety issues without fear. It is unlawful for any worker, including yourself, to be discriminated against for raising or even proposing to raise a safety issue. just ASK. If you are not sure if a task is safe to do or if you don’t know how to do it safely, the most important thing is to stop and ask someone about it. Ask for advice and don’t be afraid to say “I don’t know what to do next”.
You have the right to appropriate training, supervision, information and equipment so you can work safely.
And it’s okay to ask more than once. Some tasks are complicated and it can be easy to forget every step – especially if you work infrequently and only have to do particular tasks once in a while.
You have the right to speak up if something is wrong.
Don’t do it if it’s unsafe. Stop. Speak up. Ask.
You have the right to say ‘no’ right then and there if you think something is unsafe. Talk to your supervisor or manager immediately.
We want you to return home to your family and friends injury-free every single day.
You have the right to a safe workplace.
parent or guardian of a young worker? Talk to your child about their job, including any health and safety concerns they might have. Ask questions. Start a conversion.
What should I do WHEN ASKED TO perform a task?
WTF
Wait! Take Five. 1
Stop 2
Is it safe? 3
Could it hurt someone else? 4
Speak up 5
Ask
HELPFUL HINTS
For more information on how to talk to a young employee or your own child about workplace safety, just scan this code using a QR-enabled device, such as your phone or tablet. SDA NEWS f spring 2019 f PAGE 9
ship Sydney Application for 2019 SDA Union Picnic Day tickets on Startt tttt
tt tttttttttttttttttttttttt tttt Address: tttttttttttttttttttttttttt e: Postcod tttt tttttttttttttttttttttt Your SDA Membership No: tttttttt Work Phone Number: tt tttt tttt Mobile Phone Number: tttt ttt ttt ttttt E-mail Address: tttttttttttttttttttttttt ttt Employer: tt tt tt tt tt tt tt tt tt tt tt tt tttt Suburb/Town: t tt tt tt tt tt tt tt tt tt tt tt tt $ttt.tt each Please send me ttt Members SDA Union Picnic Day Tickets @ $60.00 $ttt.tt Tickets @ $95.00 each^ Please send me ttt Non-member guests SDA Union Picnic Day $ttt.tt s* Please send me ttt Bus Passes @ $5.00 each for SDA member $ttt.tt guests^ Please send me ttt Bus Passes @ $13.00 each for non-member $t.tt Registered Post charge of $4.50 OR $t.tt Express Post charge of $6.00 (optional) $tttt.tt Total:
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+ the special rate of $60.00 : Please supply SDA membership details for members accompanying you at ........... . . . . . ËName . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SDA membership no: . . . . ÊName . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SDA membership no: . . . . . . . . . . ........... . . . . . ÍName . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SDA membership no: . . . . ÌName . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . SDA membership no: . . . . . . . . . .
Bus travel*
I/we wish to travel by one of the limited bus routes as provided by the SDA o Penrith o Liverpool o Campbelltown o Wollongong o Blacktown o Hurstville
and wish to be picked up at the following stop: o Miranda o Greystanes o Oak Flats o Mount Druitt
+ there the SDA on 131 732 to confirm details. You can attach an additional page if *These stops are subject to change. Anyone with a large group should contact . as a guest of an SDA member. No more than one non-member guest per member is insufficient space on this application form. ^A non-member may only attend Union are not able to attend as guests. People who are eligible to be an SDA member but have elected not to join the
Payment
tttt.tt OR t Mastercard t Visa Expiry Date: tt/tt Card Number: tttt tttt tttt tttt ttttt Cardholder’sName(pleaseprint): tttttttttttttttttttttt
I enclose my cheque/money order/credit card authority for $ Please charge my credit card (tick appropriate box):
______________________ Cardholder’s Signature: _______________________________________________________________ This coupon may be used as a Tax Invoice for ABN 74 415 123 375.
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PAGE 10 f spring 2019 f SDA NEWS
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union picnic day 2019
Harbour Cruise on Starship Sydney, Tuesday 5 November 2019 r u o y t r o p p Su y! a D c i n c i P Union e SDA’s Come to th p Day event Cu Melbourne ship Sydney on Star sale n o w o n e r tickets a urry – but h t fast! ou they’ll sell
Transport
This year, NSW SDA Union Picnic Day falls on Tuesday 5 November.
Sydney function
The SDA Union Picnic Day event for members in Sydney and Illawarra will be held on Sydney Harbour, aboard the Starship Sydney. The cruise departs from King Street Wharf at noon sharp, and returns at 5.00pm. For $60 per SDA member/$95 for non-member guests who work in an industry that the SDA does not cover#, our Picnic Day function includes: 4 Buffet lunch; 4 Two complimentary drinks; 4 Sweepstakes; 4 Raffle and prizes; 4 Live coverage of the Flemington races.
As in previous years, the SDA will be providing a limited number of charter buses to the event. Buses will drop off and pick up just metres from King Street Wharf. Alternatively, you can catch a train to Wynyard Station, and join the rest of the group at King Street Wharf before midday.
Tickets
Tickets can be ordered by: 4 Phoning 131 SDA (that’s 131 732); 4 Completing the form opposite and posting it with your payment or credit card details to: SDA, PO Box K230, Haymarket NSW 1240.
Orders must be received by Friday 18 October 2019. People who are eligible to be an SDA member but have elected not to join the Union are not able to attend SDA Union Picnic Day as guests. #
SDA NEWS f spring 2019 f PAGE 11
models win private change rooms by Monica Rose Women’s Officer
Models working at this year’s Mercedes-Benz Fashion Week Australia won private changing areas for the first time in the history of the event.
This follows calls from the SDA — the models’ Union — for private change areas for models at Fashion Week. In an industry that has issues with sexual harassment, this is an overdue win. The privacy and comfort of models during fashion parades and photo shoots is a workplace right.
Photographer: Sequioa Emmanuelle
PAGE 12 f spring 2019 f SDA NEWS
For too long, models have had to change clothes in crowded common areas shared with makeup, clothing and photography staff, that provide little or no privacy for the models.
India Haylee-Barton (shown in the photos on this page), an Australianborn international model, welcomed the introduction of private changing areas for models. “I think it’s an amazing win for models in Australia and the USA. It should now be enforced globally. “In my experience it has been way too easy for media and photographers to get into the backstage area while models were changing during the fashion shows.
“I think other cities and countries should follow and enforce this, so models can feel comfortable while at work especially in an already high-stress environment.” The SDA — the models’ Union — welcomes IMG’s decision to improve the comfort and safety of models working at Australia’s most prestigious fashion event, with private changing areas. The SDA is now calling for this practice to become the industry standard for all fashion shows and photo shoots across Australia. The SDA is the Union for models in Australia and a founding member of the Australian Modelling Industry Alliance.
Photographer: Josef Jasso
australianmodelalliance.com.au @modelsguildau
continuing t0 fight sexual harassment
Too many workers in retail and fast food are experiencing sexual harassment at work. Sexual harassment by Felicity Smithson Senior Operations is unacceptable and Officer the SDA is working hard to eliminate it from workplaces. The SDA partnered with the Australian Human Rights Commission (AHRC) to find out more about the sexual harassment that workers in retail and fast food experience. We surveyed over 3,400 SDA members: 39% have experienced workplace sexual harassment in the last five years. (higher than the general workforce). u Women are more likely to experience sexual harassment at work (46% of women compared to 29% of men). u 1 in 3 women have experienced workplace sexual harassment in the last 12 months. u 3 in 5 women aged between 18 and 34 have experienced sexual harassment at work in the last five years. u 36% of harassment experienced was by a customer. u 53% of the cases of sexual harassment lasted for over 6 months. u
Inappropriate staring or leering (20%) u Unwelcome touching, hugging, cornering or kissing (14%) u Inappropriate physical contact (12%) u
reporting it u Only 13% of victims made a formal report or complaint after being sexually harassed. u Over a quarter of cases (28%) where the harassment was formally reported, there were no consequences for the perpetrator. u 60% did not report the sexual harassment because they thought other people would see it as an overreaction. u 51% did not report the sexual harassment because they didn’t think it would change anything, with 47% saying it was easier to keep quiet. u 1 in 5 (22%) of victims said they were not aware of how to report the incident or who to report to.
long-term effects 25% of those who experienced sexual harassment said it negatively impacts on their employment, career or work. u 44% of people who experienced sexual harassment said it caused mental health issues or stress, with 40% of those identifying anxiety as the consquence. u
There are several key actions we believe can help put an end to sexual harassment: u Prevention: Employers need to put in place prevention strategies to stop the harassment from occurring in the first place. u Reporting: Employers need to make reporting sexual harassment easier for their employees, and take appropriate action when incidents are reported so victims can feel safe and confident that they will be taken seriously. The full report will be launched by the AHRC in October. The SDA will be taking these survey results to employers as part of the next step to end sexual harassment in the retail and fast food industries.
How common is it? The most common forms of sexual harassment were: Sexually suggestive comments or offensive jokes (24%) u Intrusive questions about private life or personal appearances (22%) u
SDA NEWS f spring 2019 f PAGE 13
! W NE
the movie card
10% off for sda members The Movie Card is the newest way to give the gift of cinema to your friends, family and employees. For the first time in Australia, we’ve combined some of your favourite cinemas on the one gift card. With more than 75 participating cinemas Australia-wide, you know when you receive The Movie Card, you can enjoy the movies your way. Use The Movie Card at our participating cinemas to buy either luxury or traditional movie tickets, popcorn or even a cheeky glass of wine, all with the one card! From multiplex city cinemas, to classic historical theatres, to regional family-owned cinemas and of course luxury, 3D and IMAX cinemas, The Movie Card has a cinema experience for you.
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Get a 10% discount when purchasing the Card through the SDA website. To purchase your Movie Cards, just go to sdansw.org.au, click on the your benefits pull-down menu and then click on great leisure discounts. For participating cinema locations, go to themoviecard.com.au/cinemas/
PAGE 14 f spring 2019 f SDA NEWS
securing allowances for ColD work by Chris Raj, Organiser
A full-time team member who works in the fridge and freezer as part of their duties, was not aware that they were entitled to a cold allowance.
SDA Delegate Jozsef (shown right) then went to the store manager and explained that the member should get this allowance plus backpay. After Jozsef spoke with the manager and explained the entitlement from the Agreement, the allowance is now being paid and a backpay of $332.88 was paid to the member.
This is just one of many instances where Delegates and Organisers have been winning allowances that have been negotiated into Agreements and that members may not be aware of. did you know... SDA Agreements for supermarkets
u
contain an allowance for cold work, as does the General Retail Award. You are eligible for it if you are
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principally employed to enter cold areas or to stock and refill refrigerated storages such as freezer cabinets. For more information on your entitlements, contact the SDA on 131 732.
Members Say ‘Thanks’ Dear Mr Bernie Smith & Staff,
To the Secretary of the SDA
I would like to express my gratitude for all the hard work to make our Enterprise Agreement possible. You always look after us and work relentlessly for the good of all the working class.
Dear Bernie,
Thank you very much and please extend my thanks to the gentleman who visits our store to make sure everything is alright (my bad for not remembering his name). Kudos to all of you. May the force be with you. Thank you very much! Sincerely, Fe Sefton, Woolworths
Are you concerned about excessive exposure to cold in your workplace? The SDA has a fact sheet about your rights when working in cold work environments. You can access it at http://bit.ly/ColdWork or by scanning this code using your phone camera.
I am writing to let you know of my decision to retire early from the workforce and so resign from the Union. The SDA has supported me over many years in not only retail, but in the pharmaceutical industry as well, and I will always be grateful for your service. I am also very grateful for the performance of Rest over the last few years, and I look forward to the fund started by the SDA continuing to provide financial independence into the future. Please find enclosed my current membership card as ID. Regards, Alan Brazell
SDA Secures super backpay at bunnings
Part-time workers at Bunnings who worked more than their annual contracted hours will soon receive a boost to their superannuation account. Read more at
bit.ly/2nhnoyf
SDA NEWS f SPRING 2019 f PAGE 15
Fun at our Luna Park Family Day
Raffle Wool Secre
More than 1,000 SDA members, family and friends attended the SDA’s Family Day at Sydney’s Luna Park on Sunday 25 August. Thank you to Rest for supporting the day, and congratulations to the lucky raffle winners. Watch out for details of our next Family Day to be held at Jamberoo Action Park in February. One of our lucky raffle winners, Jayesh Haldaria from Coles.
Marilou Virgona from Coles was another of our winners.
Leandrew Fountas from KFC was yet another one of our winners on the day.
PAGE 16 f spring 2019 f SDA NEWS
Olive Woo happ
Raffle winner Medyan Alkateb, from Woolworths is congratulated by Secretary Bernie Smith.
WIN ONE O F
Oliver Waldron from Woolworths was pretty happy about his win, too!
5 0 DVD s!
We’re giving away 50 DVDs of The Lion King (2019 version). To enter this competition, simply: 1. Register online at www.sdansw.org.au or 2. Scan this image with your QR-enabled smartphone or 3. SMS the word ‘LION’, your first name, your last name and your membership number (for example: LION John Smith M1234567*) to 0429 577 943 or 4. Enter by mail – write your name, address, SDA membership number, phone number and employer’s name on a piece of paper, pop it into an envelope and mail it to: SDA Competitions, PO Box K230, Haymarket NSW 1240. You must have your entry in by
FRIDAY 25 OCTOBER 2019 Entries are limited to one per member. The first 50 entries drawn from the barrel will win. *Your entry must be in this format or the SMS system will reject the entry.
Winners from the competitions held in each issue of SDA News can be found in the infonet section of sdansw.org.au
rest.com.au
a changing environ by Gerard Dwyer, National Secretary
Do Good. Like lower fees so more stays in your super.
Australia’s world-class retirement income model continues to build financial security for working Australians.
A small amount put away each week into secure industry funds, coupled with the favourable tax treatment of those deposits, continues to build individual and national financial security. Rest’s Core Strategy continues to deliver strong term earnings but there are some laws impacting superannuation which members need to be aware of. It is an opportune time for you and your family to review your insurance and retirement savings. Rest’s insurance offer is also changing and this is set out below.
It’s a simple thought do good, help where you can. Like keeping fees low. It’s why almost two million Australians can trust Rest with their super. Hello progress. Hello Rest.
Product issued by Rest. Go online for a PDS to consider before deciding.
PAGE 18 f spring 2019 f SDA NEWS
Some members’ super is moving to the ATO, causing insurance cancellation From 1 July 2019, the way that some inactive and low-balance super accounts are managed changed due to new Commonwealth Government legislation. If your account balance is less than $6,000 and you have not contributed or made a change to your account in the last 16 months your super will be moved to the ATO, which will also result in your insurance being cancelled. You can stop the transfer to the ATO and the cancelling of your insurance by taking some simple actions – making a small contribution to your account; changing your investment option; or changing your insurance. Making a payment of as little as $10 will keep your retirement savings in your industry super fund, Rest. Active members with contributions being made on their behalf, or making voluntary contributions, are not affected by these changes to the law.
As thi super inund few m centre June a bringi mana
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As this change is industry-wide, superannuation contact centres have been inundated with calls and emails over the last few months, and like others the Rest contact centre unfortunately had long waiting times in June and July because of the demand. Rest is bringing on additional contact centre staff to manage the backlog.
TAL to be the new insurer Rest recently announced that it will introduce a new insurance partner, TAL. As a result, there will be a new insurance offer for members. Rest will be in touch with members about the new offer and its implementation later this year. Any members with current insurance claims will continue to have those managed through the existing arrangements. 8.95% p.a. over 10 years Financial markets closed the financial year on a positive note and Rest’s Core Strategy delivered gains of 3.35% over the quarter and 5.96% over the year ending 30 June 2019. Rest’s Core Strategy continues to deliver over the long-term, achieving 8.95% p.a. over the 10 years to end June 2019. The chart opposite shows Rest’s performance against the medium performance of other balanced funds that are tracked by SuperRatings. The markets continue to be volatile, with significant ups and downs since the end of the financial year. Rest Core Strategy’s current defensive position means that if there is a significant down turn in the markets, Rest Super would be less affected than some other funds. Rest has followed this kind of risk-managed investment approach for some time to navigate previous difficult periods for investment markets, always with a long-term focus on growing and protecting members’ funds.
woolworths restructure
know your rights As we reported in the last issue of SDA News, the Union opposed the restructure and took Woolworths to the Fair Work Commission over it.
Through the Commission, the Union was able to secure many improvements for employees including improved redundancy pay and a guarantee that by Chris Stefanovski. Customer Operating Model job offers to full-time Organiser employees will be job offers of full-time work. By the time you read this, the Woolworths restructure will have taken effect and people affected will have taken their packages. To those members who have left Woolworths, we wish you well in whatever you do next. SDA members who were working on salary but are now covered by the conditions of the Woolworths Enterprise Agreement in your new role should remember you are entitled to: u u u u u u u u
Payment for all hours worked; Notice of your rostered shifts; A roster that is not subject to frequent variations; Minimum 10 hour breaks between shifts; Paid overtime for working beyond the finish of your shift; Receiving all meal and rest breaks; All work on public holidays is voluntary; Improved leave entitlements.
If you have gone from salary onto the Enterprise Agreement, make sure you receive all the benefits of the Enterprise Agreement. Don’t get short changed.
questions? need help? phone the sda on 131 732
SDA NEWS f spring 2019 f PAGE 19
If you
work in retail
it pays to learn what you can claim at tax time It’s tax time again! If you’re preparing your
Union Fees
own tax return, it needs to be lodged with the
You can claim a deduction for your SDA Union fees – if the
Australian Taxation Office (ATO) by the end of
amount is shown on your payment summary (previously known
October.
as a group certificate), you can use that to prove your claim.
There are some tax deductions that you
Car expenses
may be entitled to, a few of which are outlined
You can claim a deduction when you drive between separate
here.
jobs with different employers on the same day – for example,
Remember:
travelling from work to your second job.
u Make sure that you write down all your
If you claim car expenses, you need to keep a logbook to determine the
income on your tax return – include any
work-related percentage, or be able to demonstrate to the ATO a reasonable
benefits received from the Government,
calculation if you use the cents per kilometre method to claim.
income from a second job and any interest you received from a bank, building society or
Clothing and grooming expenses
credit union.
You can claim a deduction for the cost of buying, hiring, mending 12:34 PM
Carrier
100%
Add expense
u Sign your tax return. It is your responsibility
or cleaning certain uniforms that are unique and distinctive to your job, or protective clothing that your employer requires you to wear.
!
SNAP to make sure that your tax return is correct SAVE! RE STO SNAP!! even if it was prepared by someone else. SAVE STORE $45.00
You can’t claim a deduction for the cost of buying or cleaning plain clothing
Cost
u Keep all the records you need to prove your
worn at work, even if your employer tells you to wear it, and even if you
Date
only wear it for work, for example, black pants and a white shirt or everyday
10/06/2017
deduction claims. TaxPack will tell you what Description
records you need to keep.
Travel expenses
Is this partly a private cost?
Yes
u Ask for help if you need it – ask your tax
clothing—even if it’s sold at the store you work for. You can’t claim a No
What can you claim on your tax return? 100%
OR
agent or ring the Tax Office on 13 28 61.
$0.00
Car
To claim a deduction for work-related expenses:
deduction for hairdressing, cosmetics, hair and skin care products, even if your employer tells you to use them and you work in a store that sells them – they are personal expenses.
Other car expenses
u You must have spent the money yourself
and weren’t reimbursed. u It must be directly related to earning your
income. u You must have a record to prove it.
You can use the ATO app myDeductions tool to keep track of your expenses and receipts throughout the year. You can only claim the work-related part of expenses. You can’t claim a deduction for any part of the expense that relates to personal use. Please note: This is a brief general summary
Meal expenses You can claim a deduction for the cost of overtime meals on those occasions where: u you worked overtime and took an overtime meal break, and u your employer paid you an overtime meal allowance under an industrial
law, award or agreement. You can’t claim a deduction for the cost of meals eaten during a normal working day as it is a private expense, even if you receive an allowance to cover the meal expense.
12:34 PM
Carrier
100%
Add expense
SNAP!! SAVE STORE SNAP!! SAVE STORE
Carrier
SNAP!! 12:34 SAPMVE STORE
100%
Add expense
Cost
SNAP!! $45.00 SAVE Date STORE
For more info, go to ato.gov.au/occupations. AP! 10/06/2017
publication, and is not tax advice.
Is this partly a 10/06/2017 private cost?
Yes
SNAP!! SAVE STORE
No
Description
SN ! SAVE STORE
What can you claim on your tax return?
Travel expenses 100%
OR
No
Cost Yes What No can you claim on your tax return?
Is this partly a Carcost? private
100%
100%
Yes
$0.00
WhatOther can you on your tax return? carclaim expenses
PAGE 20 f spring 2019 f SDA NEWS
100%
Add expense
Travel expenses $45.00
Date
only, based on information available at time of
12:34 PM
Carrier
Description Cost
OR
Car Car
Other car expenses
OR $45.00
Date
$0.00
10/06/2017
Description Other car expenses
Travel expenses
Is this partly a private cost?
Yes
No
What can you claim on your tax return? 100%
OR
Car
Other car expenses
$0.00
donating blood: your entitlements Blood donations help people through serious events in their life, such as cancer, a car accident or a difficult pregnancy.
by Narelle Atkins, Organiser
Others have medical conditions which mean they regularly need blood products.
This is why the SDA negotiates for blood donor’s leave in enterprise agreements. BLOOD DONOR’S LEAVE Many enterprise agreements that have been negotiated by the SDA include a relatively common provision known as blood donor’s leave. The SDA has negotiated this provision with major companies like Coles and Woolworths supermarkets, Bunnings, Target and Kmart, Big W, BWS and Dan Murphy’s just to name a few. The provision allows full-time and part-time employees to be absent from work without loss of pay during ordinary working hours in order to donate blood. Employees can take up to a maximum of two hours’ paid leave on each occasion, subject to a maximum of four separate absences each calendar year. It is expected that the employee will donate blood on a day suitable to the employer with sufficient notice of the scheduled appointment. Proof of attendance at a recognised place for donating place, such as the Red Cross Blood Bank, and duration of the attendance may be requested by the employer. WHERE to DONATE BLOOD Blood donation is quite easy. The whole visit to a Blood Donation Centre usually takes about one hour. There are over 100 permanent donor and mobile centres across Australia. To make an appointment to donate blood in your area, book online at www.donateblood.com.au or call the Red Cross Blood Bank on 13 14 95. SDA NEWS f SPRING 2019 f PAGE 21
The Sydney Tower Eye
Madame Tussauds
SDA members and their families are entitled to a 20% discount on single adult and child entry tickets upon presentation of their current SDA membership card.
SDA members and their families are entitled to a 20% discount on single adult and child entry tickets upon presentation of their current SDA membership card.
t (02) 9333 9222 a sydneytowereye.com.au
t (02) 9333 9240 a madametussauds.com/sydney
WILD LIFE Sydney
Australian National Maritime Museum
SDA members and their families are entitled to a 20% discount on single adult and child entry tickets upon presentation of their current SDA membership card.
t (02) 9333 9288 a wild-life.com.au
SDA members and their families are entitled to a 20% discount upon presentation of their current SDA membership card.
t (02) 9298 3777 a anmm.gov.au
Sydney Aquarium, Darling Harbour
Illawarra Fly Treetop Adventures
SDA members and their families are entitled to a 20% discount on single adult and child entry tickets upon presentation of their current SDA membership card.
t (02) 8251 7800 a sydneyaquarium.com.au
SDA members and their families are entitled to a 20% discount on single adult and child entry tickets upon presentation of their current SDA membership card. t 1300 362 881. a illawarrafly.com
Currumbin Wildlife Sanctuary, Gold Coast
Featherdale Wildlife Park, Doonside
SDA members and their families are entitled to a 20% discount upon presentation of their current SDA membership card.
SDA members and their families are entitled to a 25% discount upon presentation of their current SDA membership card.
t (07) 5534 1266 a cws.org.au
t (02) 9622 1644 a featherdale.com.au
Gold Coast Attractions
SDA members and their families are entitled to a 15% discount at these leading Gold Coast attractions:
Movieworld*
Seaworld*
Wet’n’Wild Dreamworld Water World*
t 133 FUN (133 386) t 133 FUN (133 386) t 133 FUN a myfun.com.au a myfun.com.au a myfun.com.au
White Water World
Skypoint
t (07) 5588 1111 t (07) 5588 1111 t (07) 5582 2700 a dreamworld.com.au a whitewaterworld.com.au a skypoint.com.au
*Please note: you must pre-purchase your tickets through the SDA website to access the discounts on these attractions.
Trent Driving School Book with Trent and receive a $10 discount on any full-priced lesson*. Use coupon code SDATrent when booking. Go to ltrent.com.au for more information. *offer only available to students that are new to Trent Driving School. Not valid with any other offer.
Europcar Rentals SDA members receive exclusive rates when they rent with Europcar. Simply quote 47699503 when making your booking. No PIN or Velocity number is required. For more information, phone Europcar on 1300 131 390 or go to europcar.com.au.
PAGE 22 f spring 2019 f SDA NEWS
Keeping you covered on your journey Every SDA member in NSW* is covered by our free
journey insurance as part of their Union membership. To find out more, speak to your Delegate or Organiser, contact the SDA on 131 732, or go to sdansw.org.au *ACT members are covered for journey claims under the ACT’s workers’ compensation laws.
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Motor Vehicle Accidents
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Property Law
Disputed Wills & Estates
Family Law
Migration Law
Still in Sydney & Campbelltown by appointment. From early December 2018 we will be open at Level 4, 20 Wentworth St, Parramatta, close to Parramatta Station & Westfield.
www.engagingmembers.com.au
to purchase your tickets...
t n u o Disc ie Tix Mov
H order online at www.sdansw.org.au, H phone the SDA on 131 SDA (131 732) with your credit card details, or H purchase them in person at the SDA Sydney Office between 8.30am
and 4.00pm Monday to Saturday (except on public holidays).
all ticket options are now available online!
All SDA Movie Tickets are now available as e-tickets, which you can print at home or redeem on a smartphone. Order online at sdansw.org.au.
sDa nsw branch H 131 sDa (131 732) H www.sDansw.org.au SDA NEWS f spring 2019 f PAGE 23
Shop, DiStributive & AllieD employeeS’ ASSociAtion: finAnciAl reportS for the yeAr enDeD 30 june 2019 Shop, DiStributive AnD AllieD employeeS’ ASSociAtion, AnnuAl finAnciAl report 30 june 2019 operAting report for the yeAr enDeD 30 june 2019 The members of the National Executive present their report together with the financial report of Shop, Distributive & Allied Employees’ Association (‘the Association’) for the financial year ended 30 June 2019 and the auditor’s report thereon. 1. Membership Membership of the Association as at 30 June 2019 was 203,867 (2018: 207,131). Persons eligible to do so under the rules of the Association were actively encouraged to join the Association. Pursuant to s174 of the Fair Work (Registered Organisations) Act 2009 (“RO Act�) and in accordance with Rule 27 of the Association, members have the right to resign from the Association by written notice to the appropriate Branch of the Association. 2. Committee of management The members of the National Executive of the Association at any time during or since the end of the financial year are: Name Mr Michael Donovan National President Ms Barbara Nebart National Vice President Mr Gerard Dwyer National Secretary-Treasurer Ms Julia Fox National Assistant Secretary Mr Joseph de Bruyn (retired)
Experience National Executive Member since 1996 National Vice President since 2014-2018 National President since November 2018 National Executive Member since 2004 National Vice President since November 2018 National Executive Member since 2005 National President 2008-2014 National Secretary-Treasurer since 2014 National Executive Member since 2016 National Assistant Secretary since 2016 National Executive Member (1978-2018) National Secretary-Treasurer (1978-2014) National President (2014-2018) National Executive Member since 1990 National Executive Member since since June 2019 National Executive Member (2016-2019) National Executive Member since 2014 National Executive Member since 2014 National Executive Member since 2014
committee of mAnAgement StAtement
We, Gerard Dwyer and Michael Donovan, being two members of the National Executive of the Association, do state on behalf of the National Executive and in accordance with a resolution passed by the National Executive on 22nd August 2019 in relation to the accompanying general purpose financial report that, in the opinion of the National Executive: (a) the financial statements and notes set out on pages 11 to 56 comply with the Australian Accounting Standards; (b) the financial statements and notes set out on pages 11 to 56 comply with any other requirements imposed by the Reporting Guidelines or Part 3 of Chapter 8 of the Fair Work (Registered Organisations) Act 2009 (the RO Act); (c) the financial statements and notes present a true and fair view of the financial performance, financial position and cash flows of the association for the financial year ended 30 June 2019; (d) there are reasonable grounds to believe that the Association will be able to pay its debts as and when they become due and payable; and (e) during the financial year ended 30 June 2019 and since the end of that year: (i) meetings of the committee of management were held in accordance with the rules of the organisation including the rules of a branch concerned; and (ii) the financial affairs of the Association have been managed in accordance with the rules of the organisation including the rules of a branch concerned; and (iii) the financial records of the Association have been kept and maintained in accordance with the RO Act; and (iv) where the organisation consists of two or more reporting units, the financial records of the reporting unit have been kept, as far as practicable, in a consistent manner with each of the other reporting units of the organisation; and (v) where information has been sought in any request by a member of the reporting unit or Commissioner duly made under section 272 of the RO Act has been provided to the member or Commissioner; and (vi) where any order for inspection of financial records has been made by the Fair Work Commission under section 273 of the RO Act, there has been compliance. This declaration is made in accordance with a resolution of the committee of management. Dated at Melbourne this 22nd day of August, 2019 Michael Donovan Gerard Dwyer National President National Secretary-Treasurer
certificAte by nAtionAl SecretAry-treASurer certificate for the year ended 30 june 2019
I, Gerard Dwyer, being the National Secretary–Treasurer officer responsible for keeping the accounting records of the Association certify that as at 30 June 2019 the number of members of the Association was 203,867. In my opinion: (i) the accompanying financial report set out on pages 11 to 56 presents fairly a view of the financial position of the Association as at 30 June 2019; (ii) a record has been kept of all monies paid by or collected from members of the Association and all monies so paid or collected have been credited to the bank account to which those monies are to be credited in accordance with the 6KRS 'LVWULEXWLYH $OOLHG (PSOR\HHV¡ $VVRFLDWLRQ rules of the Association; $QQXDO )LQDQFLDO 5HSRUW DV DW -XQH (iii) before any expenditure was incurred by the Association, approval of the incurring of the expenditure was obtained in accordance with the rules of the Association; ([SHQGLWXUH 5HSRUW 5HTXLUHG 8QGHU 6XEVHFWLRQ $ (iv) no payments were made out of funds or accounts operated by the Association in respect of compulsory levies raised )RU WKH \HDU HQGHG -XQH by the Association or voluntary contributions collected7KH from members of the Association or other funds, the operation FRPPLWWHH RI PDQDJHPHQW SUHVHQWV WKH H[SHQGLWXUH UHSRUW DV UHTXLUHG XQGHU VXEVHFWLRQ $ RQ WKH of which is required by the rules of the Association for $VVRFLDWLRQ IRU WKH \HDU HQGHG -XQH a purpose other than the purpose for which the funds or accounts were operated; džƉĞŜĚĹ?ĆšĆľĆŒÄžĆ? Ä‚Ć? ĆŒÄžĆ‹ĆľĹ?ĆŒÄžÄš ĆľĹśÄšÄžĆŒ Ć?Í˜ĎŽĎąĎąÍžĎŽ Íż ZK (v) no loans or other financial benefits other than remuneration inĎŽĎŹĎĎľ Ͳ respect of their full time employment with the Ä?Ćš Association were made to persons holding office in the Association; and ZÄžĹľĆľĹśÄžĆŒÄ‚ĆšĹ?ŽŜ ĂŜĚ Ĺ˝ĆšĹšÄžĆŒ (vi) a Register of Members of the Association was maintained in accordance with the Fair Work (Registered ÄžĹľĆ‰ĹŻĹ˝Ç‡ĹľÄžĹśĆšÍ˛ĆŒÄžĹŻÄ‚ĆšÄžÄš Ä?Ĺ˝Ć?ĆšĆ? ĂŜĚ Ď´Đš Organisations) Act 2009. Dated at Melbourne this 22ndĞdžƉĞŜĆ?ÄžĆ? Ͳ ĞžƉůŽLJĞĞĆ? day of August, 2019 ĎŽĎĐš ÄšÇ€ÄžĆŒĆšĹ?Ć?Ĺ?ĹśĹ? ĎĎŻĐš Gerard Dwyer 6KRS 'LVWULEXWLYH $OOLHG (PSOR\HHV¡ $VVRFLDWLRQ National Secretary-Treasurer $QQXDO )LQDQFLDO 5HSRUW DV DW -XQH Ď´Đš KĆ‰ÄžĆŒÄ‚ĆšĹ?ĹśĹ? Ä?Ĺ˝Ć?ĆšĆ?
Mr Paul Griffin Mr Josh Peak Ms Sonia Romeo (retired) Mr Bernie Smith Mr Chris Gazenbeek Mr Peter O’Keeffe 3. Affiliations & Directorships The Association, through its Branches, is affiliated with the Australian Labor Party (“ALPâ€?). Delegates were credentialed to various state and national meetings of the ALP. The National Secretary-Treasurer is a member of the ALP National Executive and the Australian Labor Advisory Council. The Association is affiliated with the Australian Council of Trade Unions (“ACTUâ€?). The National Secretary-Treasurer is Senior Vice President of the ACTU, and a director of ACTU Trustee companies ACTU Member Connect Pty Ltd and The Union Education Foundation Limited. Three other representatives of the Association are also members of the ACTU Executive. Officials of the Association are active on a range of ACTU Committees, including finance, governance, tax, health and safety, women, vocational education and training, workers capital, international and industrial legislation. The Association is affiliated to Union Network International (“UNIâ€?). Various officials of the Association hold elected positions within UNI. The National Secretary-Treasurer is Vice President of UNI-APRO. The National Secretary-Treasurer is President of UNI-APRO Commerce Sector. The National Assistant Secretary is Vice President of UNI World Women’s expenDiture report requireD unDer SubSection 255(2A) ([SHQGLWXUH 5HSRUW 5HTXLUHG 8QGHU 6XEVHFWLRQ $ Committee. ŽŜĂƚĹ?ŽŜĆ? ƚŽ ƉŽůĹ?ĆšĹ?Ä?Ä‚ĹŻ Ć‰Ä‚ĆŒĆšĹ?ÄžĆ? for the yeAr enDeD 30 june 2019 ϹϏК )RU WKH \HDU HQGHG -XQH 4. Principal activities >ÄžĹ?Ä‚ĹŻ Ä?Ĺ˝Ć?ĆšĆ? 7KH FRPPLWWHH RI PDQDJHPHQW SUHVHQWV WKH H[SHQGLWXUH UHSRUW DV UHTXLUHG XQGHU VXEVHFWLRQ $ RQ WKH The committee of management presents the expenditure report as required under subsection 255(2A) on the The Association maintained its industrial awards and agreements and produced a range of publications for its members. $VVRFLDWLRQ IRU WKH \HDU HQGHG -XQH Association for the year ended 30 June 2019. During the year ended 30 June 2019, the Association continued with its significant campaign on Customer Violence & Abuse in Retail and Fast Food, called “No One Deserves A Serveâ€?. ĎŽĎŹĎĎľ Ͳ džƉĞŜĚĹ?ĆšĆľĆŒÄžĆ? Ä‚Ć? ĆŒÄžĆ‹ĆľĹ?ĆŒÄžÄš ĆľĹśÄšÄžĆŒ Ć?Í˜ĎŽĎąĎąÍžĎŽ Íż ZK ĎŽĎŹĎĎ´ Ͳ džƉĞŜĚĹ?ĆšĆľĆŒÄžĆ? Ä‚Ć? ĆŒÄžĆ‹ĆľĹ?ĆŒÄžÄš ĆľĹśÄšÄžĆŒ Ć?Í˜ĎŽĎąĎąÍžĎŽ Íż ZK Ä?Ćš Ä?Ćš Enterprise agreements were negotiated with a range of employers, including but not limited to, Woolworths, Kmart, Bunnings and a range of warehouse agreements. These agreements all resulted in improved wages and working ZÄžĹľĆľĹśÄžĆŒÄ‚ĆšĹ?ŽŜ ĂŜĚ Ĺ˝ĆšĹšÄžĆŒ ZÄžĹľĆľĹśÄžĆŒÄ‚ĆšĹ?ŽŜ ĂŜĚ Ĺ˝ĆšĹšÄžĆŒ ÄžĹľĆ‰ĹŻĹ˝Ç‡ĹľÄžĹśĆšÍ˛ĆŒÄžĹŻÄ‚ĆšÄžÄš Ä?Ĺ˝Ć?ĆšĆ? ĂŜĚ ÄžĹľĆ‰ĹŻĹ˝Ç‡ĹľÄžĹśĆšÍ˛ĆŒÄžĹŻÄ‚ĆšÄžÄš Ä?Ĺ˝Ć?ĆšĆ? ĂŜĚ ĎĐš Ď´Đš conditions for the employees covered by them. ĎĎŹĐš ĞdžƉĞŜĆ?ÄžĆ? Ͳ ĞžƉůŽLJĞĞĆ? ĞdžƉĞŜĆ?ÄžĆ? Ͳ ĞžƉůŽLJĞĞĆ? ĎĎ´Đš ĎŽĎĐš ÄšÇ€ÄžĆŒĆšĹ?Ć?Ĺ?ĹśĹ? ÄšÇ€ÄžĆŒĆšĹ?Ć?Ĺ?ĹśĹ? The Association continues its defence of penalty rates in the Hair and Beauty Award and also protects other entitlements ĎĎŻĐš from attack by employers. The Association also promotes and protects members by participating in a range of legislative ϾК KĆ‰ÄžĆŒÄ‚ĆšĹ?ĹśĹ? Ä?Ĺ˝Ć?ĆšĆ? Ď´Đš KĆ‰ÄžĆŒÄ‚ĆšĹ?ĹśĹ? Ä?Ĺ˝Ć?ĆšĆ? inquiries and reviews. There were no significant changes in the Association during the financial year in the nature of its activities and financial ŽŜĂƚĹ?ŽŜĆ? ƚŽ ƉŽůĹ?ĆšĹ?Ä?Ä‚ĹŻ Ć‰Ä‚ĆŒĆšĹ?ÄžĆ? ŽŜĂƚĹ?ŽŜĆ? ƚŽ ƉŽůĹ?ĆšĹ?Ä?Ä‚ĹŻ Ć‰Ä‚ĆŒĆšĹ?ÄžĆ? affairs. At 30 June 2019, there were 16.1 effective full-time equivalent employees of the National Office of the Association ϲώК ϹϏК (2018: 14.7). >ÄžĹ?Ä‚ĹŻ Ä?Ĺ˝Ć?ĆšĆ? >ÄžĹ?Ä‚ĹŻ Ä?Ĺ˝Ć?ĆšĆ? Further information is available on the SDA National website at www.sda.org.au. Dated at Melbourne this 22nd day of August, 2019 5. SDA Report to the Workplace Gender Equality Agency 'DWHG DW 0HOERXUQH WKLV GD\ RI $XJXVW ĎŽĎŹĎĎ´ Ͳ džƉĞŜĚĹ?ĆšĆľĆŒÄžĆ? Ä‚Ć? ĆŒÄžĆ‹ĆľĹ?ĆŒÄžÄš ĆľĹśÄšÄžĆŒ Ć?Í˜ĎŽĎąĎąÍžĎŽ Íż ZK Michael Donovan Gerard Dwyer The Shop, Distributive and Allied Employees’ Association, as required by the Workplace Gender Equality Act 2012, lodged Ä?Ćš National President National Secretary-Treasurer its public report for the reporting year 2018-2019, to the Workplace Gender Equality Agency, on the 29th May 2019. The BBBBBBBBBBBBBBBBBBBBBBBBBB BBBBBBBBBBBBBBBBBBBBBBBBBBB ZÄžĹľĆľĹśÄžĆŒÄ‚ĆšĹ?ŽŜ ĂŜĚ Ĺ˝ĆšĹšÄžĆŒ 0LFKDHO 'RQRYDQ *HUDUG 'Z\HU report is available on the SDA National website at www.sda.org.au. ÄžĹľĆ‰ĹŻĹ˝Ç‡ĹľÄžĹśĆšÍ˛ĆŒÄžĹŻÄ‚ĆšÄžÄš Ä?Ĺ˝Ć?ĆšĆ? ĂŜĚ ĎĐš officer DeclArAtion StAtement 1DWLRQDO 3UHVLGHQW 1DWLRQDO 6HFUHWDU\ 7UHDVXUHU ĎĎŹĐš ĞdžƉĞŜĆ?ÄžĆ? Ͳ ĞžƉůŽLJĞĞĆ? ĎĎ´Đš 6. Superannuation Trustees ÄšÇ€ÄžĆŒĆšĹ?Ć?Ĺ?ĹśĹ? I, Gerard Dwyer, being the National Secretary-Treasurer of the Shop Distributive & Allied Employees’ Association, declare 3DJH , Four representatives of the Association hold positions as Directors of the Retail Employees’ Superannuation Trust that the following activitiesϾК did not occur during the reporting period ending 30 June 2019. (“RESTâ€?). Below are the directors as at 30 June 2019, and those nominated as alternate Employee Directors. KĆ‰ÄžĆŒÄ‚ĆšĹ?ĹśĹ? Ä?Ĺ˝Ć?ĆšĆ? The reporting unit did not: Directors: Alternates: • agree to receive financial support from another reporting unit to continue as a going concern (refers to agreement ŽŜĂƚĹ?ŽŜĆ? ƚŽ ƉŽůĹ?ĆšĹ?Ä?Ä‚ĹŻ Ć‰Ä‚ĆŒĆšĹ?ÄžĆ? • Mr Joseph de Bruyn • Mr Gerard Dwyer regarding ϲώК financial support not dollar amount) • agree to provide financial support to another reporting unit to ensure they continue as a going concern (refers to • Mr Ian Blandthorn • Mr Michael Donovan >ÄžĹ?Ä‚ĹŻ Ä?Ĺ˝Ć?ĆšĆ? agreement regarding financial support not dollar amount) • Mr Michael Tehan • Ms Aliscia Di Mauro • acquire an asset or liability due to an amalgamation under Part 2 of Chapter 3 of the RO Act, a restructure of the 'DWHG DW 0HOERXUQH WKLV GD\ RI $XJXVW • Ms Julia Fox • Dr Adam Walk (Appointed 28 November 2018) branches of an organisation, a determination or revocation by the General Manager, Fair Work Commission 7. Information to be provided to Members or General Manager • receive periodic or membership subscriptions BBBBBBBBBBBBBBBBBBBBBBBBBB BBBBBBBBBBBBBBBBBBBBBBBBBBB In accordance with the requirements of subsection 272(5) of the RO Act, the attention of members is drawn to the • receive revenue levies 0LFKDHO 'RQRYDQ via compulsory *HUDUG 'Z\HU 1DWLRQDO 3UHVLGHQW via grants 1DWLRQDO 6HFUHWDU\ 7UHDVXUHU provisions of subsections (1), (2) and (3) of section 272, which states as follows: • receive other income or donations • receive other income via revenue from undertaking recovery of wages activity • A member of a reporting unit, or the Commissioner, may apply to the reporting unit for specified prescribed 3DJH , • incur fees as consideration for employers making payroll deductions of membership subscriptions information in relation to the reporting unit to be made available to the person making the application. • pay capitation fees to another reporting unit • The application must be in writing and must specify the period within which, and the manner in which, the information • pay compulsory levies is to be made available. The period must not be less than 14 days after the application is given to the reporting unit. • pay a penalty imposed under the RO Act or the Fair Work Act 2009 • A reporting unit must comply with an application made under subsection (1). • have a receivable with other reporting units Dated at Melbourne this 22nd day of August, 2019 • have a payable to an employer for that employer making payroll deductions of membership subscriptions Michael Donovan Gerard Dwyer • have a fund or reserve account in equity for compulsory levies, voluntary contributions or required by the rules of the National President National Secretary-Treasurer organisation • transfer to or withdraw from a fund or reserve account in equity (other than the general fund in equity), account, asset or controlled entity • have a balance within the general fund in equity • have another entity administer the financial affairs of the reporting unit • make a payment to a former related party of the reporting unit Dated at Melbourne this 22nd day of August, 2019 f f Gerard Dwyer National Secretary-Treasurer
Assets Cash a Trade Other Total cu Proper Investm Employ Total no TOTAL Liabiliti Trade Employ Total cu Employ Total no TOTAL NET AS Equity Retain TOTAL
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PAGE 24 spring 2019 SDA NEWS
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2018 $ 1,253,269 620,672 26,700,000 28,573,941 584,014 24,000,000 467,459 25,051,473 53,625,414 396,986 725,156 1,122,142 27,858 27,858 1,150,000 52,475,414 52,475,414 52,475,414
StAtement of profit or loSS AnD other comprehenSive income for the yeAr enDeD 30 june 2019
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2019 $
Assets Cash and cash equivalents 10 1,426,029 Trade and other receivables 11 509,352 27,000,000 Other financial assets 12 28,935,381 Total current assets Property, plant and equipment 14 600,188 Investment property 15 28,000,000 192,903 Employee benefits 17 28,793,091 Total non-current assets 57,728,472 TOTAL ASSETS Liabilities Trade and other payables 16 376,627 808,698 Employee benefits 17 1,185,325 Total current liabilities 33,657 Employee benefits 17 33,657 Total non-current liabilities 1,218,982 TOTAL LIABILITIES 56,509,490 NET ASSETS Equity 56,509,490 Retained earnings 56,509,490 TOTAL EQUITY The notes on pages 15 to 56 are an integral part of these financial statements.
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StAtement of cASh flowS for the yeAr enDeD 30 june 2019
StAtement of finAnciAl poSition AS At 30 june 2019
Note 2019 $ Revenue Affiliation fees 21 6,566,153 1,423,322 Rental income 15(a) 7,989,475 Total revenue 5,225,820 Other income 6 5,225,820 Total other income 13,215,295 Total income Expenditure 53 Queen St, Melbourne - direct operating expenses 15(a) 634,483 ACTU IR Campaign Levy 21 Advertising 716,007 Affiliation fees 21 2,147,376 Audit fees 22 33,836 Delegates expenses/allowances - meetings and conferences 186,009 Depreciation 14 98,990 Grants and donations 8 1,618,565 Legal costs 9 748,510 Conference and meeting expenses 326,593 Administration expenses 7 195,145 Other expenses 13 723,523 Personnel expenses 18 1,996,972 192,599 Travel expenses 9,618,608 Total Expenses 3,596,687 Result from Operating Activities Finance income 621,727 Interest income 12 Income tax expense 4(m) 4,218,414 Surplus/(deficit) for the year Other comprehensive income Items that will never be reclassified to profit or loss Re-measurement of defined benefit asset (loss)/gain 17 (184,338) Income tax on other comprehensive income Items that are or may be reclassified to profit or loss (184,338) Other comprehensive (loss)/income, net of tax 4,034,076 TOTAL COMPREHENSIVE INCOME FOR THE PERIOD The notes on pages 15 to 56 are an integral part of these financial statements.
2018 $ 6,016,150 1,470,677 7,486,827 6,057,037 6,057,037 13,543,864 602,863 2,000,000 915,233 2,134,393 30,986 319,774 100,290 191,250 1,114,655 278,056 181,731 861,615 1,806,626 195,413 10,732,885 2,810,979 601,276 3,412,255 80,700 80,700 3,492,955
StAtement of chAngeS in equity for the yeAr enDeD 30 june 2019 Note
Retained earnings $ 52,475,414
Balance at 1 July 2018 Total comprehensive income for the period Surplus/(deficit) for the period 4,218,414 Other comprehensive income Re-measurement of defined benefit asset, net of tax 17 (184,338) Total comprehensive income for the period 4,034,076 Transactions with members of the Association, recognised directly in equity Balance at 30 June 2019 56,509,490 Balance at 1 July 2017 48,982,459 Total comprehensive income for the period Surplus/(deficit) for the period 3,412,255 Other comprehensive income Re-measurement of defined benefit asset, net of tax 17 80,700 Total comprehensive income for the period 3,492,955 Transactions with members of the Association, recognised directly in equity Balance at 30 June 2018 52,475,414 The notes on pages 15 to 56 are an integral part of these financial statements.
Total equity $ 52,475,414 4,218,414 (184,338) 4,034,076 56,509,490 48,982,459 3,412,255 80,700 3,492,955
Note 2019 $ Cash flows from operating activities Cash receipts from operations Cash receipts from other reporting units 19b 8,602,216 Cash receipts from other sources 1,811,598 Total cash receipts from operations 10,413,814 Cash payments used in operations Cash paid to suppliers (9,009,723) Cash paid to employees (1,138,764) Cash paid to other reporting units 19b (182,433) Total cash payments used in operations (10,330,920) Cash generated/(used in) from operations 82,894 Interest received 617,762 19a Net cash from/(used in) operating activities 700,656 Cash flows from investing activities (Acquisition of) /proceeds from term deposits (300,000) (Acquisition of) property, plant and equipment 14 (126,506) (Acquisition of) fixutes and fittings for investment property 15 (111,570) Proceeds from sale of property, plant and equipment 10,180 Net cash (used in)/from investing activities (527,896) Cash flows from financing activities Net cash from/(used in) financing activities Net increase/(decrease) in cash and cash equivalents 172,760 Cash and cash equivalents at 1 July 1,253,269 10/19a CASH AND CASH EQUIVALENTS AT 30 JUNE 1,426,029 The notes on pages 15 to 56 are an integral part of these financial statements.
2018 $ 8,475,235 1,900,490 10,375,725 (10,135,815) (1,055,994) (201,680) (11,393,489) (1,017,764) 619,245 (398,519) 800,000 (56,527) (39,384) 21,832 725,921 327,402 925,867 1,253,269
noteS to finAnciAl StAtementS 1. reporting entity Shop, Distributive & Allied Employees’ Association (the ‘Association’) is an Association domiciled in Australia. The address of the Association’s registered office is Level 6, 53 Queen Street, Melbourne. The financial report of the Association for the financial year ended 30 June 2019 comprises the National Account and the International Fund. The Association is a not-forprofit entity and primarily is involved in retail trade union activities. 2. bASiS of prepArAtion A) STATEMENT OF COMPLIANCE The financial statements are general purpose financial statements and have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (‘AASB’) that apply for the reporting period, and the Fair Work (Registered Organisations) Act 2009. This is the first set of the Association’s financial statements in which AASB 9 Financial Instruments has been applied. Under the transition method chosen, comparative information has not been restated. The financial statements were approved by the National Executive on the 22nd day of August, 2019. b) basis of measurement The financial statements have been prepared on an accrual basis and in accordance with the historical cost, except for the following material items in the statement of financial position: l investment property is measured at fair value; and l the defined benefit asset is recognized as the net total of the fair value of plan assets, plus unrecognised past service cost and unrecognised actuarial losses, less unrecognised actuarial gains and the present value of the defined benefit obligation. Historical cost is generally based on the fair values of the consideration given in exchange for assets. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. c) functional and presentation currency The financial report is presented in Australian dollars, which is the Association’s functional currency. d) comparative amounts When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. e) use of estimates and judgements The preparation of financial statements in conformity with AASBs requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. (i) Judgements Information about critical judgements in applying accounting policies that have the most significant effect on the amount recognised in the financial statements is included in the following notes: l Note 15 – Investment property. (ii) Assumptions and estimation uncertainties Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year are included in the following note: l Note 17 – Employee benefits. Measurement of fair values A number of the Association’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. The Association has an established control framework with respect to the measurement of fair values. Significant fair value measurements are overseen and reviewed regularly, including unobservable inputs and valuation adjustments. If third party information is used to measure fair values, the Association assesses the evidence obtained from the third parties to support the conclusion that such valuations meet the requirements of AASBs, including the level in the fair value hierarchy in which such valuations should be classified. Significant valuation issues are reviewed by the Association’s Audit and Risk Committee. When measuring the fair value of an asset or a liability, the Association uses market observable data as far as possible. Fair values are categorised into different levels in a fair value hierarchy based on the inputs used in the valuation techniques as follows. l Level 1 – quoted prices (unadjusted) in active markets for identical assets or liabilities. l Level 2 – inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices). l Level 3 – inputs for the asset or liability that are not based on observable market data (unobservable inputs). If the inputs used to measure the fair value of an asset or a liability might be categorised in different levels of the fair value hierarchy, then the fair value measurement is categorised in its entirety in the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement. The Association recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred. Further information about the assumptions made in measuring fair values is included in the following notes: l Note 15 – investment property.
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SDA NEWS f spring 2019 f PAGE 25
3. new AuStrAliAn Accounting StAnDArDS a) adoption of new australian accounting standards No accounting standard has been adopted earlier than the application date stated in the standard. The accounting policies adopted are consistent with those of the previous financial year except for the following standard and amendment, which has been adopted for the first time this financial year: l AASB 9 Financial Instruments and relevant amending standards, which replaces AASB 139 Financial Instruments: Recognition and Measurement. Impact on adoption of AASB 9 Initial application AASB 9 Financial Instruments (AASB 9) replaces AASB139 Financial Instruments: Recognition and Measurement (AASB 139) for annual periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting for financial instruments: classification and measurement; impairment; and hedge accounting. The Association has applied AASB 9 prospectively, with an initial application date of 1 July 2018. The Association has not restated the comparative information, which continues to be reported under AASB 139. Differences arising from the adoption of AASB 9 would be recognised directly in opening retained earnings and other components of equity as at 1 July 2018 (of which there were none). (i) Classification and measurements Under AASB 9, debt instruments are subsequently measured at fair value through profit or loss (FVTPL), amortised cost, or fair value through other comprehensive income (FVTOCI). The classification is based on two criteria: the Association’s business model for managing the assets; and whether the instruments’ contractual cash flows represent ‘solely payments of principal and interest’ on the principal amount outstanding. The assessment of the Association’s business model was made as of the date of initial application, 1 July 2018. The assessment of whether contractual cash flows on debt instruments are solely comprised of principal and interest was made based on the facts and circumstances as at the initial recognition of the assets. The classification and measurement requirements of AASB 9 did not have a significant impact to the Association. l Trade receivables and other non-current financial assets (i.e., Loan to a related party) previously classified as loans and receivables are held to collect contractual cash flows and give rise to cash flows representing solely payments of principal and interest. These are now classified and measured as debt instruments at amortised cost. The Association has not designated any financial liabilities as at fair value through profit or loss. There are no changes in classification and measurement for the Association’s financial liabilities. In summary, upon adoption of AASB 9, the Association applied the following required or elected reclassifications: 1 July 2018
AASB 139 measurement category Loans and receivables Cash and cash equivalents Receivables
AASB 9 measurement category Fair value through Amortised Fair value profit or loss cost through OCI $ $ $ 1,253,269 620,672 1,873,941
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1,253,269 620,672 1,873,941
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(ii) Impairment loss The adoption of AASB 9 has changed the Association’s accounting for impairment losses for financial assets by replacing AASB 139’s incurred loss approach with a forward looking Expected Credit Loss (ECL) approach. AASB 9 requires the association to recognize an allowance for ECLs for all debt instruments not held at fair value through profit or loss and contract assets, i.e. those held at amortised cost and at fair value through other comprehensive income. b) future australian accounting standards requirements New standards, amendments to standards or interpretations that were issued prior to the sign-off date and are applicable to future reporting periods that are expected to have a future financial impact on the Association include: (i) AASB 16 Leases (AASB 16) AASB 16 was issued in January 2016 and it replaces AASB 117 Leases, AASB Interpretation 4 Determining whether an Arrangement contains a Lease, AASB Interpretation-115 Operating Leases-Incentives and AASB Interpretation 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease. For NFP entities, AASB 16 will commence from financial years beginning on or after 1 January 2019. Either a full retrospective application or a modified retrospective application is required for AASB 16. The Association plans to adopt AASB 16 on the required effective date 1 July 2019 of using the modified retrospective method. AASB 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under AASB 117. The standard includes two recognition exemptions for lessees – leases of ’low-value’ assets (e.g., personal computers) and short-term leases (i.e., leases with a lease term of 12 months or less). At the commencement date of a lease, a lessee will recognise a liability to make lease payments (i.e., the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e., the right-of-use asset). Lessees will be required to separately recognise the interest expense on the lease liability and the depreciation expense on the right-ofuse asset. Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g., a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the amount of the re-measurement of the lease liability as an adjustment to the right-of-use asset. Lessor accounting under AASB 16 is substantially unchanged from today’s accounting under AASB 117. Lessors will continue to classify all leases using the same classification principle as in AASB 117 and distinguish between two types of leases: operating and finance leases. During the financial year ended 30 June 2019, the Association performed a preliminary assessment of AASB 16, noting no material leases are held by the Association where the Association acts as a lessee. (ii) AASB 1058 Income of Not-for-Profit Entities (AASB 1058) and AASB 15 Revenue from Contracts with Customers (AASB 15) AASB 1058 clarifies and simplifies the income recognition requirements that apply to not-for-profit (NFP) entities in conjunction with AASB 15. AASB 1058 and AASB 15 supersede all the income recognition requirements relating to private sector NFP entities, and the majority of income recognition requirements relating to public sector NFP entities, previously in AASB 1004 Contributions. For NFP entities, both AASB 1058 and 15 will commence from financial years beginning on or after 1 January 2019. Either a full retrospective application or a modified retrospective application is required for AASB 15. The Association plans to adopt AASB 15 on the required effective date 1 July 2019 using modified retrospective method. 4. SignificAnt Accounting policieS The accounting policies set out below have been applied consistently to all periods presented in these financial statements by the Association. a) revenue (i) Affiliation fees Affiliation fees are fees received from the Branches of the Association in accordance with the rules of the Association. Such fees are referred to as affiliation fees in the rules and are calculated as a percentage of gross Branch membership income and paid annually in March for the financial year (1 July to 30 June). Revenue (received or receivable) from affiliation fees is accounted for on an accrual basis under AASB 118 Revenue standard and is recorded as revenue in the financial year to which it relates. Revenue is measured at the fair value of the consideration received or receivable. (ii) Rental Income Rental income from investment property is recognised in profit or loss on a straight line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income, over the term of the lease. b) finance income and finance costs Finance income comprises interest income on funds invested. Interest income is recognised as it accrues in profit or loss, using the effective interest method. Foreign currency gains and losses are reported on a net basis as either finance income or finance cost depending on whether foreign currency movements are in a net gain or net loss position. Interest income is recognised on an effective interest rate basis except for debt instruments other than those financial assets that are recognised at fair value through profit or loss. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, or, when appropriate, a shorter period, to the net carrying amount on initial recognition. c) gains Sale of assets Gains and losses from disposal of assets are recognised when control of the asset has passed to the buyer.
d) affiliation fees and levies Affiliation fees and levies are recognised on an accrual basis and recorded as an expense in the year it relates to which it relates. e) employee benefits (i) Defined benefit plans The Association’s net obligation in respect of defined benefit plans is calculated separately for each plan by estimating the amount of future benefit that employees have earned in the current and prior periods, discounting that amount and deducting the fair value of any plan assets. The calculation of defined benefit obligations is performed annually by a qualified actuary using the projected unit credit method. When the calculation results in a potential asset for the Association, the recognised asset is limited to the present value of economic benefits available in the form of any future refunds from the plan or reductions in future contributions to the plan. To calculate the present value of economic benefits, consideration is given to any applicable minimum funding requirements. Re-measurements of the net defined benefit liability, which comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest), are recognised immediately in other comprehensive income. The Association determines the net interest expense (income) on the net defined benefit liability (asset) for the period by applying the discount rate used to measure the defined benefit obligation at the beginning of the annual period to the then-net defined benefit liability (asset), taking into account any changes in the net defined benefit liability (asset) during the period as a result of contributions and benefit payments. Net interest expense and other expenses related to defined benefit plans are recognised in profit or loss. When the benefits of a plan are changed or when a plan is curtailed, the resulting change in benefit that relates to past service or the gain or loss on curtailment is recognised immediately in profit or loss. The Association recognises gains and losses on the settlement of a defined benefit plan when the settlement occurs. (ii) Other long-term employee benefits The Association’s net obligation in respect of long-term employee benefits other than defined benefit superannuation funds is the amount of future benefit that employees have earned in return for their service in the current and prior periods plus related on-costs; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is the yield at the reporting date on Australian Corporate bonds that have maturity dates approximating the terms of the Association’s obligations in which the benefits are expected to be paid. (iii) Short-term benefits Liabilities for employee benefits for wages, salaries and annual leave represent present obligations resulting from employees’ services provided to reporting date and are calculated at undiscounted amounts and expensed based on remuneration wage and salary rates that the Association expects to pay as at reporting date including related on-costs, such as workers compensation insurance and payroll tax. Amounts that are expected to be settled beyond 12 months are measured in accordance with long term benefits. f) leases Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. (i) Lease payments Payments made under operating leases are recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease. Minimum lease payments made under finance leases are apportioned between the finance expense and the reduction of the outstanding liability. The finance expense is allocated to each period during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability. (ii) Determining whether an arrangement contains a lease At inception of an arrangement, the Association determines whether such an arrangement is or contains a lease. This will be the case if the following two criteria are met: • the fulfilment of the arrangement is dependent on the use of a specific asset or assets; and • the arrangement contains a right to use the asset(s). At inception or upon reassessment of the arrangement, the Association separates payments and other consideration required by such an arrangement into those for the lease and those for other elements on the basis of their relative fair values. If the association concludes for a finance lease that it is impracticable to separate the payments reliably, an asset and a liability are recognised at an amount equal to the fair value of the underlying asset. Subsequently the liability is reduced as payments are made and an imputed finance charge on the liability is recognised using the Association’s incremental borrowing rate. g) cash Cash is recognised at its nominal amount. Cash and cash equivalents includes cash on hand, deposits held at call with bank, other short-term highly liquid investments with original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the statement of financial position. h) financial instruments Financial assets and financial liabilities are recognised when the Association becomes a party to the contractual provisions of the instrument. Financial assets (i) Initial recognition and measurement Financial assets are classified, at initial recognition, and subsequently measured at amortised cost, fair value through other comprehensive income (FVTOCI), or fair value through profit or loss (FVTPL). The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Association’s business model for managing them. With the exception of trade receivables that do not contain a significant financing component, the Association initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it needs to give rise to cash flows that are ‘solely payments of principal and interest’ (SPPI) on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Association’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the market place (regular way trades) are recognised on the trade date, i.e., the date that the Association commits to purchase or sell the asset. (ii) Subsequent measurement For purposes of subsequent measurement, financial assets are classified in five categories: l (Other) financial assets at amortised cost l (Other) financial assets at fair value through other comprehensive income l Investments in equity instruments designated at fair value through other comprehensive income l (Other) financial assets at fair value through profit or loss l (Other) financial assets designated at fair value through profit or loss The Association measures financial assets at amortised cost if both of the following conditions are met: l The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows; and l The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. The Association’s financial assets at amortised cost includes trade and other receivables, term deposits held with the Commonwealth Bank of Australia (see note 12) and cash and cash equivalents. (iii) De-recognition A financial asset is derecognised when: l The rights to receive cash flows from the asset have expired; or l The Association has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows in full without material delay to a third party under a ‘passthrough’ arrangement; and either: a) the Association has transferred substantially all the risks and rewards of the asset; or b) the Association has neither transferred nor retained substantially all the risks and rewards of the asset, but has transferred control of the asset. When the Association has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Association continues to recognise the transferred asset to the extent of its continuing involvement together with associated liability.
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(iv) Offsetting Financial assets and financial liabilities are offset and the net amount is reported in the statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously. Impairment of financial assets (i) Trade receivables For trade receivables that do not have a significant financing component, the Association applies a simplified approach in calculating expected credit losses (ECLs) which requires lifetime expected credit losses to be recognised from initial recognition of the receivables. Therefore, the Association does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Association has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. (ii) Debt instruments other than trade receivables For all debt instruments other than trade receivables and debt instruments not held at fair value through profit or loss, the Association recognises an allowance for expected credit losses using the general approach. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Association expects to receive, discounted at an approximation of the original effective interest rate. ECLs are recognised in two stages: l Where there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses from possible default events within the next 12-months (a 12-month ECL). l Where there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the debt, irrespective of the timing of the default (a lifetime ECL). The Association considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Association may also consider a financial asset to be in default when internal or external information indicates that the Association is unlikely to receive the outstanding contractual amounts in full. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. Financial liabilities (i) Initial recognition and measurement Financial liabilities are classified, at initial recognition, at amortised cost or at fair value through profit or loss. All financial liabilities are recognised initially at fair value and, in the case of financial liabilities at amortised cost, net of directly attributable transaction costs. The Association’s financial liabilities include trade and other payables. (ii) Subsequent measurement After initial recognition, trade payables and other payables are subsequently measured at amortised cost using the effective interest rate (EIR) method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in profit or loss. (iii) De-recognition A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the de-recognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in profit or loss. Share capital The Association is an unincorporated registered organisation under the Fair Work (Registered Organisations) Act 2009 and does not have share capital. Foreign currency transactions Transactions in foreign currencies are translated to the functional currency of the Association at exchange rates at the dates of the transactions. Monetary assets and liabilities denominated in foreign currencies at the reporting date are retranslated to the functional currency at the exchange rate at that date. The foreign currency gain or loss on monetary items is the difference between amortised cost in the functional currency at the beginning of the period, adjusted for effective interest and payments during the period, and the amortised cost in foreign currency translated at the exchange rate at the end of the year. Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are retranslated to the functional currency at the exchange rate at the date that the fair value was determined. Non-monetary items in a foreign currency that are measured in terms of historical cost are translated using the exchange rate at the date of the transaction. Foreign currency differences arising on retranslation are recognised in profit or loss. i) contingent assets and liabilities Contingent liabilities and contingent assets are not recognised in the Statement of Financial Position but are reported in the relevant notes. They may arise from uncertainty as to the existence of a liability or asset or represent an existing liability or asset in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain, and contingent liabilities are disclosed when settlement is greater than remote. j) property, plant and equipment (i) Recognition and measurement Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. The initial cost of an asset includes expenditures that are directly attributable to the acquisition of the asset. The gain or loss on disposal of an item of property, plant and equipment is determined by comparing the proceeds from disposal with the carrying amount of property, plant and equipment and is recognised net within other income/other expenses in profit or loss. (ii) Subsequent costs The cost of replacing part of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefits embodied within the part will flow to the Association and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profit or loss as incurred. (iii) Depreciation Depreciation is calculated over the depreciable amount, which is the cost of an asset, or other amount substituted for cost, less its residual value. Depreciation is recognised in profit or loss on a straight-line or diminishing value over the estimated useful lives of each part of an item of property, plant and equipment, to most closely reflect the expected pattern of consumption of the future economic benefits embodied in the asset. Leased assets are depreciated over the shorter of the lease term and their useful lives unless it is reasonably certain that the Association will obtain ownership by the end of the lease term. Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and adjusted as appropriate. Depreciation rates applying to each class of depreciable asset are based on the following useful lives: 2019 2018 Leasehold improvements 5-20 years 5-20 years Fixtures and fittings 4-20 years 4-20 years Motor vehicles 8 years 8 years (iv) De-recognition An item of land, buildings, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in the profit and loss. k) investment property Investment properties are properties held to earn rentals or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of goods or services or for administrative purposes. Investment properties are measured initially at its cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at fair value. Gains and losses arising from changes in the fair value of investment properties are included in profit and loss in the period in which they arise. Refer to note 15(b) for details of determination of fair value. Cost includes expenditure that is directly attributable to the acquisition of the investment property. The cost of selfconstructed investment property includes the cost of materials and direct labour, any other costs directly attributable to bringing the investment property to a working condition for their intended use and capitalised borrowing costs. An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on de-recognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the property is derecognised.
When an investment property that was previously classified as property, plant and equipment is sold, any related amount included in the revaluation reserve is transferred to retained earnings. When the use of a property changes such that it is reclassified as property, plant and equipment, its fair value at the date of reclassification becomes its cost for subsequent accounting. l) impairment of non-financial assets The carrying amounts of the Association’s non-financial assets, other than investment property, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognised if the carrying amount of an asset or its cashgenerating unit (CGU) exceeds its recoverable amount. A CGU is the smallest identifiable asset group that generates cash flows that largely are independent from other assets and groups. Impairment losses are recognised in profit or loss. The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset or CGU. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the Association were deprived of the asset, its value in use is taken to be its depreciated replacement cost. Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is only reversed to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised. m) taxation The Association is exempt from income tax under section 50.1 of the Income Tax Assessment Act 1997 however still has obligation for Fringe Benefits Tax (FBT) and the 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 taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated with the amount of GST excluded, as the Association reports to the ATO for GST on a cash-basis. The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the balance sheet. Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising from investing and financing activities which are recoverable from, or payable to, the ATO are classified as operating cash flows. n) provisions A provision is recognised if, as a result of a past event, the Association has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. o) fair value measurement A number of the Association’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. Also, fair values of financial instruments measured at amortised cost are disclosed in Note 23a. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: • In the principal market for the asset or liability, or • In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the Association. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Association uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: • Level 1 — Quoted (unadjusted) market prices in active markets for identical assets or liabilities • Level 2 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable • Level 3 — Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable For assets and liabilities that are recognised in the financial statements on a recurring basis, the Association determines whether transfers have occurred between Levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. External valuers are involved for valuation of significant assets, such as investment properties. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. For the purpose of fair value disclosures, the Association has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy. p) segment reporting An operating segment is a component of the Association that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the other Association’s other components. All operating segments’ operating results are reviewed regularly by the Association’s office holders to make decisions about resources to be allocated to the segment and to assess its performance, and for which discrete financial information is available. q) financial risk management The Association has exposure to the following risks from their use of financial instruments: i) Credit risk ii) Liquidity risk iii) Market risk iv) Operational risk Risk Management Framework The National Executive has overall responsibility for the establishment and oversight of the risk management framework. Risk management policies are established to identify and analyse the risks faced by the Association, to set appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in market conditions and the Association’s activities. The Association, through its training and management standards and procedures, aims to develop a disciplined and constructive control environment in which all employees understand their roles and obligations. A detailed assessment of the Association’s exposure to the above risks is included in note 23. 5. eventS After the reporting perioD There were no events that occurred after 30 June 2019, and prior to the signing of the financial statements, that would affect the ongoing structure and financial activities of the Association. 6. other income Note 2019 $ 2018 $ Investment property - fair value increment 15 3,888,430 4,210,616 ACTU trust distributions 21 25,719 99,842 SDA Branch reimbursements 21 1,254,043 1,688,609 REST director’s fees 21 58,790 54,795 Gain/(loss) on disposal of assets (1,162) 3,175 5,225,820 6,057,037 7. ADminiStrAtion expenSeS Note 2019 $ 2018 $ Information technology support 36,321 34,825 Office expenses 62,405 60,878 Printing & photocopier 23,779 22,768 Subscriptions 42,325 39,138 Telecommunication 30,315 24,122 195,145 181,731 Total administration expense
SDA NEWS f spring 2019 f PAGE 27
8. grAntS or DonAtionS 2019 $ 2018 $ Grants: Total paid that were $1,000 or less Total paid that exceeded $1,000 Donations: Total paid that were $1,000 or less Total paid that exceeded $1,000 1,618,565 191,250 1,618,565 191,250 Total grants or donations 9. legAl coStS Litigation 66,159 289,478 Other legal matters 682,351 825,177 Total legal costs 748,510 1,114,655 10. cASh AnD cASh equivAlentS Cash at bank 19,857 320,566 Cash management account 1,245,548 873,141 Short term deposits 160,624 59,562 Total cash and cash equivalents 1,426,029 1,253,269 11. receivAbleS Other receivables: Accrued interest income 97,937 93,972 Sundry debtors 273,996 413,073 Prepayments 137,419 113,627 Total receivables net of impairment provision 509,352 620,672 12. other current ASSetS 27,000,000 26,700,000 Term deposits 27,000,000 26,700,000 Total other current assets Term deposits have stated interest rates of 1.96 to 2.37 percent (2018: 2.37 to 2.54 percent) and mature in 120 days or more. The Association’s exposure to credit and interest rate risk is disclosed in note 23. During the year ended 30 June 2019, the Association received interest income of $621,727 (2018: $601,276) in respect of financial assets not at fair value through profit and loss. 13. other expenSeS Consultants and professional services 341,251 437,480 Information communications technology 327,731 380,095 Motor vehicle running costs 25,578 30,946 Other 28,963 13,094 Total other expenses 723,523 861,615 14. property, plAnt AnD equipment Cost Furniture and Motor Leasehold Total fittings Vehicles Improvements $ $ $ $ Balance at 1 July 2018 290,345 96,463 697,010 1,083,818 Acquisitions 7,429 119,077 126,506 Disposals (33,606) (33,606) Balance at 30 June 2019 297,774 62,857 816,087 1,176,718 Balance at 1 July 2017 244,966 132,494 692,038 1,069,498 Acquisitions 51,555 4,972 56,527 Disposals (6,176) (36,031) (42,207) Balance at 30 June 2018 290,345 96,463 697,010 1,083,818 Depreciation and impairment losses Balance at 1 July 2018 144,534 51,389 303,881 499,804 Depreciation expense for the year 28,250 9,293 61,447 98,990 Disposals (22,264) (22,264) Balance at 30 June 2019 172,784 38,418 365,328 576,530 Balance at 1 July 2017 122,450 53,641 246,973 423,064 Depreciation expense for the year 27,946 15,436 56,908 100,290 Impairments (5,862) (17,688) (23,550) Balance at 30 June 2018 144,534 51,389 303,881 499,804 Carrying amounts At 1 July 2018 145,811 45,074 393,129 584,014 At 30 June 2019 124,990 24,439 450,759 600,188 At 1 July 2017 122,516 78,853 445,065 646,434 At 30 June 2018 145,811 45,074 393,129 584,014 15. inveStment property a) reconciliation of carrying amount Property 2019 $ 2018 $ 24,000,000 19,750,000 Opening balance as at 1 July Capital improvements 111,570 39,384 Net gain from fair value adjustment 3,888,430 4,210,616 Closing balance as at 30 June 28,000,000 24,000,000 Investment property comprises a commercial property located at 53 Queen Street, Melbourne. The Association retains possession of levels 6 and 7 as its registered head office and leases the remaining floors to third parties. Each of the leases contains an initial non-cancellable period of a minimum of three years, with fixed percentage annual rent increases. Some lease incentives were paid towards tenancy fit-outs and are being amortised over the period of the leases on a straight line basis. No contingent rents are paid. Further information about these leases are contained in Note 20. Rental income earned and received from the investment property during the year was $1,423,322 (2018: $1,470,677). Direct expenses incurred in relation to the investment properties that generated rental income during the year was $634,483 (2018: $602,863). During the year and as at year-end, no restrictions on the realisability of investment property or the remittance of income and proceeds of disposal were present. The Association does not have any contractual obligations to purchase, construct or develop investment property or for repairs, maintenance or enhancements. b) measurement of fair value (i) Fair value hierarchy The fair value of investment property was determined by external, independent property valuers, having appropriate recognised professional qualifications and recent experience in the location and category of the property being valued. The independent valuers provide the fair value of the Association’s investment property at least every two years. In years where external, independent valuations are not obtained, these are substituted with Association management performing internal valuations utilising publicly available market data for properties with similar characteristics to the Association’s investment property. The fair value measurement for investment property of $28,000,000 was determined at 30 June 2019 by Gary Longden, Director and certified practising valuer of M3 Property P/L, a registered independent appraiser having an appropriate recognised professional qualification from Australian Property Institute and recent experience in the location and category of the property being valued. The fair value measurement has been categorised as a Level 3 fair value based on the inputs to the valuation technique used (see Note 4(o)). (ii) Level 3 fair value – valuation technique and significant unobservable inputs The following shows the valuation technique used in measuring the fair value of investment property, as well as the significant unobservable inputs used. Valuation techniques: Discounted cash flow approach (2019), Discounted cash flow approach (2018) Discounted cash flow approach: The discounted cash flow approach involves formulating a projection of net income over a specified horizon, typically ten years, and discounting this cash flow including the projected terminal value at the end of the projection period at an appropriate rate. The present value of this discounted cash flow represents the Market value of the property.
PAGE 28 f spring 2019 f SDA NEWS
Significant unobservable inputs: • 2019: Discount rate 6.50%, • 2018: Discount rate 7.00%. Inter-relationship between key unobservable inputs and fair value measurement The estimated fair value would increase (decrease) if: • 2019: The discount rate was lower (higher), • 2018: The discount rate was lower (higher) 16. trADe AnD other pAyAbleS Payables to other reporting units SDA Victoria Total trade payables Litigation Other legal matters PAYG withholding tax Tenant security deposits Other Total other payables Total trade and other payables are expected to be settled in: No more than 12 months More than 12 months Total trade and other payables 17. EmployEE bEnEfits Current liability Office holders Liability for long service leave Liability for annual leave Separation and redundancies Other Employees other than office holders Liability for long service leave Liability for annual leave Separation and redundancies Other Non-current liability Employees other than office holders Liability for long-service leave
Sensitiv The ca summa (decrea
2019 $
2018 $
5,931 5,931 44,311 38,864 157,924 129,597 370,696
4,258 4,258 58,034 32,946 56,862 244,886 392,728
218,703 157,924 376,627
340,124 56,862 396,986
167,178 53,331 220,509
156,472 52,392 208,864
284,947 303,242 588,189 808,698
247,493 268,799 516,292 725,156
33,657 33,657
27,858 27,858
Non-current asset Office holders and other employees Present value of funded obligations 2,245,200 1,827,723 Fair value of plan assets - funded (2,438,103) (2,295,182) Recognised (asset) for defined benefit obligations (192,903) (467,459) The Association makes contributions to the SDA (Victoria Branch) benefit superannuation plan, a sub-plan of the Retail Employees' Superannuation Trust, that provide defined benefit amounts for office holders and other employees upon retirement. The Association has determined that, in accordance with the terms and conditions of the defined benefit plans, and in accordance with statutory requirements (such as minimum funding requirements) of the plan of the respective jurisdictions, the present value of refunds or reductions in future contributions is not lower than the balance of the fair value of the plan assets less the total present value of obligations. As such, no decrease in the defined benefit asset is necessary at 30 June 2019 (30 June 2018: no decrease in the defined benefit asset). The following tables analyse plan assets, present value of defined benefit obligations, expense recognised in profit or loss, actuarial assumptions and other information for the plan. Movements in the net asset for defined benefit obligations recognised in the statement of financial position: Net (asset)/liability for defined benefit obligations at 1 July (467,459) (587,644) Contributions paid into the plan Amount recognised in other comprehensive income - actuarial 184,338 (80,700) Expenses recognised in statement of comprehensive income 90,218 200,885 Net (asset)/liability for defined benefit obligations at 30 June (192,903) (467,459) Movement in the present value of the defined benefit obligations Defined benefit obligations at 1 July 1,827,723 2,336,666 Current service cost 231,835 217,272 Interest cost 65,915 62,551 Actuarial losses/(gains) recognised in other comprehensive income (see below) 245,039 39,645 Benefits paid by the plan (80,438) (804,095) Taxes, premium & expenses paid (44,874) (24,316) Defined benefit obligations at 30 June 2,245,200 1,827,723 All benefits are vested at the end of the reporting period. Movement in the present value of plan assets Fair value of plan assets at 1 July 2,295,181 2,924,310 Expected return on plan assets at discount rate 207,533 78,938 Actuarial losses/(gains) recognised in other comprehensive income (see below) 60,701 120,345 Contributions paid Benefits paid (80,438) (804,095) Taxes and expenses (44,874) (24,316) Fair value of plan assets at 30 June 2,438,103 2,295,182 Expense recognised in profit or loss Current service costs 231,835 217,272 Net interest costs (141,617) (16,387) 90,218 200,885 Re-measurements of net defined benefit liability/asset Loss/(Gain) on defined benefit obligation 245,039 39,645 (Gain)/Loss on assets (60,701) (120,345) 184,338 (80,700) Recognised in other comprehensive income Actuarial gains (and losses) recognised in other comprehensive income Cumulative amount at 1 July 189,794 109,094 Recognised during the period (184,338) 80,700 5,456 189,794 Cumulative amount at 30 June The major categories of plan assets as a percentage of total fund assets are as follows: 2019 2018 Australian Equity 17% 17% International Equity 23% 23% Fixed Income 6% 6% Property 9% 9% Cash 8% 8% Other 37% 37% Actuarial assumptions Principal actuarial assumptions at the reporting date (expressed as weighted averages): Discount rate at 30 June 2.40% 3.75% Future salary increases 3.75% 4.00%
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Sensitivity analysis The calculation of the defined benefit obligation is sensitive to the assumptions set out above. The following table summarises how the impact on the defined benefit obligation at the end of the reporting period would have increased (decreased) as a result of a change in the respective assumptions by one percent. 2019 $ 2018 $ Additional DBO for a 1% decrease in the discount rate 175,773 146,951 Reduction in DBO for a 1% increase in the discount rate 153,801 128,802 The above sensitivities are based on the average duration of the benefit obligation determined by the actuary as at 30 June 2019 and are applied to adjust the defined benefit obligation at the end of the reporting period for the assumptions concerned. Whilst the analysis does not take account of the full distribution of cash flows expected under the plan, it does provide an approximation to the sensitivity of the assumptions shown. Historical information 2019 $ 2018 $ Present value of the defined benefit obligation 2,245,200 1,827,723 Fair value of plan assets - funded (2,438,103) (2,295,182) Recognised (asset)/liability for defined benefit obligation (192,903) (467,459) Funding The plan is fully funded by the Association. The funding requirements are based on the plan fund’s actuarial measurement framework set out in the funding policies of the plan. The funding is based on a separate actuarial valuation for funding purposes for which the assumptions may differ from the assumptions above. Employees are not required to contribute to the plan. The Association expects to contribute NIL (2019: NIL) to its defined benefit superannuation fund during the year ended 30 June 2020 as it is is currently on a contributions holiday. 18. perSonnel expenSeS 2019 $ 2018 $ Holders of office: Wages and salaries 303,720 293,466 Superannuation (including expenses related to defined benefit) 24,946 56,172 Leave and other entitlements 11,646 31,422 Separation and redundancies Other employee expenses 54,645 57,509 Total employee expenses - holders of office 394,957 438,569 Employees other than office holders: Wages and salaries 1,326,445 1,079,375 Superannuation (including expenses related to defined benefit) 116,341 175,459 Leave and other entitlements 77,695 (78,674) Separation and redundancies 118,090 Other employee expenses 81,534 73,807 Total employee expenses - employees other than office holders 1,602,015 1,368,057 Total employee expenses 1,996,972 1,806,626 19. cASh flow reconciliAtion AnD informAtion 19a. cash flow reconciliation Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement: Cash and cash equivalents as per: Cash flow statement 1,426,029 1,253,269 Balance sheet 1,426,029 1,253,269 Difference Reconciliation of profit/(loss) to net cash from operating activities: Profit/(loss) for the year 4,218,414 3,412,255 Adjustments for non-cash items Depreciation 98,990 100,290 Fair value movements in investment property (3,888,430) (4,210,616) Loss/(gain) on disposal of assets 1,162 (3,175) Actuarial gains/(losses) recognised in equity on defined benefit plan (184,338) 80,700 Changes in assets/liabilities Change in accrued interest income (3,965) 17,969 Change in prepayments (23,792) (49,893) Change in sundry debtors 139,077 102,405 Change in pension asset/(liability) 274,556 120,185 Change in trade and other payables (20,359) 78,614 Change in provisions and employee benefits 89,341 (47,253) Net cash from/(used in) operating activities 700,656 (398,519) 19b. cash flow information Cash inflows Cash receipts from other reporting units SDA Newcastle 572,913 565,498 SDA New South Wales 2,339,436 2,328,502 SDA Queensland 1,458,635 1,382,996 SDA South Australia 1,055,009 1,077,618 SDA Tasmania 235,407 231,288 SDA Victoria 1,929,067 1,876,755 SDA Western Australia 1,011,749 1,012,578 Total cash inflows 8,602,216 8,475,235 Cash ouflows Cash paid to other reporting units SDA Newcastle 75,099 SDA New South Wales 23,585 18,960 SDA Queensland 51,438 18,665 SDA South Australia SDA Tasmania SDA Victoria 81,152 77,386 SDA Western Australia 26,258 11,570 Total cash outflows 182,433 201,680 20. contingent liAbilitieS, ASSetS AnD commitmentS Operating lease commitments — as lessor The Association leases out its investment property (see note 15a) under operating leases. The future minimum lease income under non-cancellable leases are as follows: 2019 $ 2018 $ Within one year 1,273,597 1,244,958 After one year but not more than five years 1,473,506 1,781,173 After five years 2,747,103 3,026,131 21: relAteD pArty DiScloSureS Terms and conditions of transactions with related parties All transactions with related parties are made on terms equivalent to those that prevail in arm’s length transactions. Outstanding balances for all transactions at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended 30 June 2019, the association has not recorded any impairment of receivables relating to amounts owed by related parties and declared person or body (2018: $Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates.
Branches The Association received from its branches the following affiliation fees: SDA Newcastle SDA New South Wales SDA Queensland SDA South Australia SDA Tasmania SDA Victoria SDA Western Australia The Association received from its branches the following expense reimbursements: 2019 ACTU ALP No One IT IR Campaign Election Deserves Workit Levy Donation A Serve App Campaign $ $ $ $ SDA Newcastle 29,882 43,356 8,901 SDA New South Wales 129,048 184,971 38,441 SDA Queensland 65,616 106,293 19,545 SDA South Australia 59,307 68,213 17,666 SDA Tasmania 10,956 19,432 3,264 SDA Victoria 106,462 151,315 31,713 SDA Western Australia 48,729 54,884 14,515 450,000 628,464 134,045 2018 ACTU Penalty No One IT IR Campaign Rate Deserves Workit Levy Campaign A Serve App Campaign $ $ $ $ SDA Newcastle 67,120 34,252 5,901 SDA New South Wales 282,620 144,280 24,847 SDA Queensland 150,248 77,164 13,209 SDA South Australia 131,884 38,815 11,595 SDA Tasmania 24,361 7,407 2,142 SDA Victoria 238,332 121,306 20,954 SDA Western Australia 105,435 55,051 9,270 1,000,000 478,275 87,918
2019 $ 436,424 1,761,378 1,126,093 808,462 179,448 1,456,863 797,485 6,566,153
2018 $ 402,345 1,633,283 1,000,253 764,533 173,894 1,301,778 740,064 6,016,150
Other
IT Intranet
TOTAL
$ 345 4,621 4,264 1,636 201 496 1,024 12,587 Other
$ 1,922 8,301 4,221 3,815 705 6,848 3,135 28,947 IT Intranet
$ 84,406 365,382 199,939 150,637 34,558 296,834 122,287 1,254,043 TOTAL
$ 177 13,709 6,783 24,389 899 8,524 3,960 58,441
$ 4,294 18,081 9,612 8,437 1,559 15,247 6,745 63,975
$ 111,744 483,537 257,016 215,120 36,368 404,363 180,461 1,688,609
The amounts paid or payable by the Association to its branches for expenses incurred on its behalf: 2019 $ 2018 $ SDA Newcastle Meeting expenses 34,352 Delegates expenses 114 Legal costs (litigation) 33,807 SDA New South Wales Administration expenses (office supplies) 2,138 670 Delegates expenses 17,701 16,334 Other expenses (motor vehicle running costs) 1,602 1,684 SDA Queensland Delegates expenses 3,517 16,300 Meeting expenses 43,245 2,020 SDA Victoria Personnel expenses (reimbursement of Victorian payroll tax) 87,082 75,351 SDA Western Australia Federal Branch - Delegates expenses 1,098 State Union – Delegate expenses 4,631 10,362 State Union - Litigation costs 19,240 The amounts owed to its branches at 30 June 2019 by the Association are included in payables to other reporting units in Note 16. Affiliates The amounts paid or payable by the Association to its affiliates for expenses incurred on its behalf: ACTU Affiliation fees paid 1,328,705 1,357,551 IR Campaign Levy 2,000,000 Meeting expenses – attendance at conferences, forums & training 1,732 14,841 Union Network International (UNI) Affiliation fees paid 818,671 776,842 Donations – UNI-APRO Activities Fund 277,815 ALP National Secretariat Meeting expenses & Fund-raising dinner 1,045 100 Donations 1,000,000 ALP NSW Donation - Federal Campaign, Organiser Salaries 116,250 69,750 WA Labor Donation – Federal Swan & Burt Campaign 46,500 46,500 ALP SA Meeting expenses 5,850 ALP Qld Donation 93,000 The Association received trust distribution income of $25,719 (2018: $99,842) from the ACTU as an affiliate. In accordance with the ACTU “Constitution, Rules and Standing Orders” this was acquitted by the ACTU as additional affiliation fees and is included above. There were no amounts owed to its affiliates at 30 June 2019 by the Association. Other related parties Key management personnel The following were key management personnel of the Association during the financial year: Name Position Joseph de Bruyn Officer – National President until November 2018 Officer – National Vice-President until November 2018 Michael Donovan Officer - National President from November 2018 Barbara Nebart Officer – National Vice-President from November 2018 Gerard Dwyer Officer – National Secretary-Treasurer Julia Fox Officer – National Assistant Secretary Bernie Smith National Executive Member Paul Griffin National Executive Member Josh Peak National Executive Member from June 2019 Sonia Romeo National Executive Member until June 2019 Chris Gazenbeek National Executive Member Peter O’Keeffe National Executive Member Key management personnel remuneration The National Secretary-Treasurer and National Assistant Secretary are salaried employees of the Association with contributions made for them to a post-employment defined benefit superannuation fund. The Association also provides motor vehicles and parking and the National Secretary-Treasurer is provided accomodation when travelling to the registered National Office in Melbourne. The retiring National President was provided a motor vehicle and parking. The incoming National President and Vice-President receive honorariums. As the National Executive Members are not paid by the Association, there are only 4 remunerated officer holders of the Association for the year. The Association pays or reimburses travel, accommodation and meal allowances for the National Officers and the National Executive Members whilst attending National Council and/or National Executive meetings or performing other Association duties, and are disclosed in the Statement of profit or loss in Delegate expenses/allowances – meetings and conferences. The National Officers and National Executive Members are allowed to keep any frequent flyer points or rewards earned as a result of such travel, the value of which cannot be determined.
Key management personnel compensation to the National Officers comprised: Short-term employee benefits Post-employment benefits Other long term benefits
2019 $ 449,950 56,001 7,522 513,473
2018 $ 563,105 61,198 7,268 631,571
Note 17 discloses liabilities for annual leave and long service leave for office holders. 2019 Gerard Dwyer Michael Joseph Julia Fox Barbara Total $ Secretary- Donovan de Bruyn Assistant Nebart Treasurer VicePresident Secretary VicePresident President Short-term employee benefits Salary (including annual leave taken) 162,972 140,748 303,720 Honorarium & gifts 3,500 3,500 Annual leave accrued 2,483 (3,218) (735) REST Director Fees 51,142 51,142 Non-monetary (accommodation, motor vehicle & parking) 57,111 10,664 24,548 92,323 Total short-term employee benefits 222,566 3,500 61,806 162,078 449,950 Post-employment benefits Superannuation-Defined Benefit 24,446 21,112 45,558 Superannuation (REST SG payments) 4,858 5,585 10,443 Total post-employment benefits 24,446 4,858 26,697 56,001 Other long-term benefits Long-service leave 4,036 3,486 7,522 Total other long-term benefits 4,036 3,486 7,522 Total 251,048 3,500 66,664 192,261 513,473 2018 Gerard Dwyer Michael Joseph Julia Fox Barbara Total $ Secretary- Donovan de Bruyn Assistant Nebart Treasurer VicePresident Secretary VicePresident President Short-term employee benefits Salary (including annual leave taken) 157,470 135,996 293,466 Honorarium & gifts 3,500 3,500 Annual leave accrued 4,199 3,627 7,826 REST Director Fees 153,425 153,425 Non-monetary (accommodation, motor vehicle & parking) 55,692 24,211 24,985 104,888 Total short-term employee benefits 217,361 3,500 177,636 164,608 563,105 Post-employment benefits Superannuation-Defined Benefit 23,621 20,399 44,020 Superannuation (REST SG payments) 14,575 2,603 17,178 Total post-employment benefits 23,621 14,575 23,002 61,198 Other long-term benefits Long-service leave 3,900 3,368 7,268 Total other long-term benefits 3,900 3,368 7,268 Total 244,882 3,500 192,211 190,978 631,571 Joe de Bruyn did not restand for the position of President in November 2018. Michael Donovan was elected to the position of President and Barbara Nebart to the position of Vice President. No payments were made in respect of the FY19 financial year to Barbara Nebart. Apart from the details disclosed in this note, no officer has entered into any material transactions with the Association since the end of the previous financial year and there were no material contracts involving officers’ interests existing at year-end. Superannuation No Contributions (2018: NIL) were made to a post-employment defined benefit fund managed by the Retail Employees’ Superannuation Trust (“REST”) on behalf of salaried office holders and employees other than office holders. The Association received director fees of $58,790 (2018: $54,795) from REST for the services performed by nominated office holders and employees employed by the Association. These director fees are included in Other Income in note 6. Mr Joe de Bruyn on being elected National President in October 2014 no longer receives a salary from the Association, therefore is entitled to personally receive director fees for services as a REST director from November 2014, these are disclosed in short-term employee benefits in key management personnel in Note 21. He did not restand for the position of President in November 2018. The directors personally receive Superannuation Guarantee (SG) payments from REST for the above director fees, these are disclosed in postemployment benefits for key management personnel in Note 21. Transactions with key management personnel and their close family members 2019 $ 2018 $ Loans/to from key management personnel Other transactions with key management personnel Information communications technology expenses paid to ITO Australia, 6,774 a company owned by the brother-in-law of the National Secretary 6,774 22. AuDitor’S remunerAtion Audit services Auditors of the Association KPMG Australia: 33,836 30,986 Audit and review of financial reports 33,836 30,986 Other services Auditors of the Association KPMG Australia: 2,810 2,755 Other assurance services 2,810 2,755 36,646 33,741 TOTAL AUDITORS’ REMUNERATION 23. finAnciAl inStrumentS 23a. categories of financial instruments Financial assets Amortised cost: Cash and cash equivalents 1,426,029 1,253,269 Receivables 509,352 620,672 27,000,000 26,700,000 Other financial assets 28,935,381 28,573,941 Total financial assets at amortised cost 28,935,381 28,573,941 Carrying amount of financial assets Financial liabilities Other financial liabilities: 376,627 396,986 Trade and other payables 376,627 396,986 Carrying amount of financial liabilities 23b. net income and expense from financial assets Financial assets at amortised cost Interest revenue - cash and cash equivalents 11,296 6,455 610,431 594,821 Interest revenue – other financial assets 621,727 601,276 Total income from financial assets at amortised cost 621,727 601,276 Total income from financial assets
PAGE 30 f spring 2019 f SDA NEWS
23c. credit risk Credit risk is the risk of financial loss to the Association if a customer or counterparty to a financial instrument fails to meet its contractual obligations, and arises principally from the Association’s receivables from customers and other financial assets. The following table illustrates the entity’s gross exposure to credit risk, excluding any collateral or credit enhancements Financial assets 2019 $ 2018 $ Trade and other receivables 509,352 620,672 Cash and cash equivalents 1,426,029 1,253,269 Other financial assets 27,000,000 26,700,000 Total 28,935,381 28,573,941 Receivables The Association’s exposure to credit risk is influenced mainly by the individual characteristics of each customer or tenant. Credit evaluations are performed on all tenants of the investment property prior to the signing of a lease agreement and security deposits are required by way of bank guarantees or cash, to be held for the term of all leases. None of the Association’s receivables are past due (2018: nil) and based on historic default rates and the minimal credit risk, the Association believes no impairment allowance is necessary. None of the tenants were in arrears at the balance sheet date and there is no indication to management that any of the tenants present a significant credit risk. All receivables are with tenants in the Australian geographical region and therefore no impairment loss has been recognised at balance date (2018: no impairment loss). Trade and other receivables Days past due Current < 30 days 30-60 days 61-90 days >91 days Total 30 June 2019 $ $ $ $ $ $ Expected credit loss rate -% -% -% -% -% -% Estimate total gross carrying amount at default Expected credit loss 30 June 2018 Expected credit loss rate -% -% -% -% -% -% Estimate total gross carrying amount at default Expected credit loss Cash and cash equivalents The Group held cash and cash equivalents of $1,426,029 at 30 June 2019 (2018: $1,253,269), which represents its maximum credit exposure on these assets. The cash and cash equivalents are held with bank and financial institution counterparties which are located in Australia, currently the CBA with a current long term credit rating of Aa3 (Moody’s Investor Services). Other financial assets The other financial assets are all bank bills and term deposits issued by the Commonwealth Bank of Australia and the Association believes no impairment allowance is necessary. The Association’s maximum exposure to credit risk for the components of the statement of financial position at 30 June 2019 and 2018 is the carrying amounts as illustrated in Note 23c. 23d. liquidity risk Liquidity risk is the risk that the Association will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by delivering cash or another financial asset. The Association’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Association’s reputation. The Association prepares budgets and cash flow forecasts, which assists it in monitoring cash flow requirements and optimising its cash return on investments. Typically the Association ensures that it has sufficient cash on demand to meet expected operational expenses for a period of at least 120 days, the maximum term of its primary financial assets being term deposits. This excludes the potential impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters. The carrying amount of the Association’s financial liabilities is represented by trade and other payables (note 16). The carrying amounts approximate contractual cash flows and all are due in 3 months or less (2018: 3 months or less). The Association has adequate financial assets to meet these liabilities and assesses liquidity risk as minimal. Contractual maturities for financial liabilities 2019 On Demand < 1 year 1– 2 years 2– 5 years >5 years Total $ $ $ $ $ Trade and other payables 376,627 376,627 Total 376,627 376,627 Contractual maturities for financial liabilities 2018 On Demand < 1 year 1– 2 years 2– 5 years >5 years Total $ $ $ $ $ Trade and other payables 396,986 396,986 Total 396,986 396,986 23e. market risk Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices will affect the Association’s income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return. Currency risk The Association has limited exposure to currency risks on International Fund transactions (international affiliation fees and donations) that are denominated in a currency other than the functional currency, being the Australian dollar (AUD). The currencies in which these transactions primarily are denominated are Swiss Francs (CHF), Singapore dollars (SGD) and American dollars (USD). The Association uses at its discretion forward exchange contracts (typically 1-3 months) to hedge its currency risk, with maturity dates the same as the due dates of the International Fund transactions. At reporting date there were no forward exchange contracts in place. Interest rate risk The Association’s interest rate risk arises from its investments in bank bills, term deposits and cash management accounts. Bank bills and term deposits are issued at fixed rates for terms of between 30 and 120 days. The Association maintains a number of different bank bills and term deposits maturing at regular intervals to smooth fluctuations in interest rates being offered. The majority of cash reserves are held in term deposits, with cash management bank accounts (with variable interest rates) used to provide liquidity funds at call. At the reporting date the interest rate profile of the Association’s interest-bearing financial instruments was: Sensitivity analysis of the interest rate risk that the Association is exposed to for 2019 Risk variable Change in Effect on risk variable % Profit and loss Equity $ $ Financial assets Cash and cash equivalents Interest rate 100bp increase 12,606 12,606 Other financial assets Interest rate 100bp increase 284,534 284,534 Sensitivity analysis of the interest rate risk that the Association is exposed to for 2018 Risk variable Change in Effect on risk variable % Profit and loss Equity $ $ Financial assets Cash and cash equivalents Interest rate 100bp increase 12,413 12,413 Other financial assets Interest rate 100bp increase 239,847 239,847 Operational risk Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the Association’s processes, personnel, technology and infrastructure, and from external factors other than credit, market and liquidity risks such as those arising from legal and regulatory requirements and generally accepted standards of corporate behaviour. Operational risks arise from all of the Association’s operations. The Association’s objective is to manage operational risk so as to balance the avoidance of financial losses and damage to the Association’s reputation with overall cost effectiveness and to avoid control procedures that restrict initiative and creativity.
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The primary responsibility for the development and implementation of controls to address operational risk is assigned to senior management within the Association. This responsibility is supported by the development of overall Association standards for the management of operational risk in the following areas: • Requirements for appropriate segregation of duties, including the independent authorisation of transactions; • Requirements for the reconciliation and monitoring of transactions; • Compliance with regulatory and other legal requirements; • Documentation of controls and procedures; • Requirements for the periodic assessment of operational risks faced, and the adequacy of controls and procedures to address the risks identified; • Requirements for the reporting of operational losses and proposed remedial action; • Development of contingency plans; • Training and professional development; • Ethical and business standards; • Risk mitigation, including insurance where this is effective. Capital management The Association’s policy is to maintain a strong capital base so as to maintain member, creditor and market confidence and to sustain future development of the union’s activities. The National Executive monitors the return on capital and seeks to maintain a conservative position between higher returns and the advantages and security afforded by a sound capital position. There were no changes in the Association’s approach to capital management during the year, and the Association is not subject to externally imposed capital requirements. 24. controlleD entitieS Parent entity The Association comprises the Shop, Distributive and Allied Employees’ Association National Account and the International Fund. 2019 % 2018 % Controlled Entity Ordinary shares WT Travel Pty Ltd 100 100 WT Travel Pty Ltd, an Australian controlled entity, was purchased by the Shop Distributive and Allied Employees’ Association National Executive on 30 September 1993. It formerly traded as a travel agency, but is currently a dormant Association. Given WT Travel is a dormant Association and its results and financial position at 30 June 2019 are nil, consolidated accounts are not prepared. 25. fAir vAlue meASurement 25a. financial assets and liabilities Management of the Association assessed that the fair values of cash, receivables, trade payables, and other current liabilities approximate their carrying amounts largely due to the short term maturities of these instruments. 25b. financial and non-financial assets and liabilities fair value hierarchy The following table provides an analysis of financial and non-financial assets and liabilities that are measured at fair value, by fair value hierarchy. Fair value hierarchy – 30 June 2019 Level 3 Level 1 Level 2 Assets measured at fair value Date of valuation $ $ $ Investment property 30 June 2019 28,000,000 Total assets measured at fair 28,000,000 value Fair value hierarchy – 30 June 2018 Level 3 Level 1 Level 2 Assets measured at fair value Date of valuation $ $ $ Investment property 30 June 2018 24,000,000 Total assets measured at fair 24,000,000 value Refer to note 15(b) for further detail over fair value measurement of the investment property. 26: Section 272 fAir work (regiStereD orgAniSAtionS) Act 2009 In accordance with the requirements of the Fair Work (Registered Organisations) Act 2009, the attention of members is drawn to the provisions of subsections (1) to (3) of section 272, which reads as follows: Information to be provided to members or Commissioner: 1. A member of a reporting unit, or the Commissioner, may apply to the reporting unit for specified prescribed information in relation to the reporting unit to be made available to the person making the application. 2. The application must be in writing and must specify the period within which, and the manner in which, the information is to be made available. The period must not be less than 14 days after the application is given to the reporting unit. 3. A reporting unit must comply with an application made under subsection (1).
inDepenDent AuDitor’S report to the memberS of the Shop, DiStributive AnD AllieD employeeS’ ASSociAtion
report on the audit of the financial report
opinion We have audited the Financial Report of the Shop, Distributive and Allied Employees’ Association (the Association). In our opinion, the accompanying Financial Report presents fairly, in all material respects, the financial position of the Shop, Distributive and Allied Employees’ Association as at 30 June 2019, and of its financial performance and its cash flows for the year then ended, in accordance with: l the Australian Accounting Standards; and; l other requirements imposed by the reporting guidelines and Part 3 of Chapter 8 of the Fair Work (Registered Organisations) Act 2009 The Financial Report comprises: l Statement of financial position as at 30 June 2019 l Statement of profit or loss and other comprehensive income, Statement of changes in equity, and Statement of cash flows for the year then ended l Notes including a summary of significant accounting policies l Other explanatory information including the Committee of Management Statement, Officer Declaration Statement and the Expenditure Report Required Under Subsection 255(2A). basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. 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 Association in accordance with 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 fulfilled our other ethical responsibilities in accordance with the Code. restriction on use and distributution The Financial Report has been prepared to assist the Committee of Management of Shop, Distributive and Allied Employees’ Association in complying with the financial reporting requirements of the Fair Work (Registered Organisations) Act 2009. As a result, the Financial Report and this Auditor’s Report may not be suitable for another purpose. Our opinion is not modified in respect of this matter. Our report is intended solely for the Committee of Management and members of the Shop, Distributive and Allied Employees’ Association and should not be used by parties other than the Committee of Management and the members of Shop, Distributive and Allied Employees’ Association. We disclaim any assumption of responsibility for any reliance on this report, or on the Financial Report to which it relates, to any person other than the Committee of Management and the members of the Shop, Distributive and Allied Employees’ Association or for any other purpose than that for which it was prepared.
other information Other Information is financial and non-financial information in Shop, Distributive and Allied Employees’ Association’s annual reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Committee of Management are responsible for the Other Information. The Other Information we obtained prior to the date of this Auditor’s Report was the Operating Report and the Certificate by the National Secretary – Treasurer. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report. responsibilities of the committee of management for the financial report The Committee of Management are responsible for: l the preparation and fair presentation of the Financial Report in accordance with the financial reporting requirements of Part 3 of Chapter 8 of the Fair Work (Registered Organisations) Act 2009 l iimplementing necessary internal control to enable the preparation of a Financial Report that that is free from material misstatement, whether due to fraud or error l assessing the Association’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Association or to cease operations, or have no realistic alternative but to do so. auditor’s responsibilities for the audit of the financial report Our objective is: l to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and l 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. They 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: http://www.auasb.gov.au/auditors_responsibilities/ar4.pdf. This description forms part of our Auditor’s Report. I declare that I am an auditor registered under the RO Act.
report on other legal and regulatory requirements
opinion I declare that, as part of the audit of the financial report for the financial year ended 30 June 2019, the Committee of Management’s use of the going concern basis of accounting in the preparation of the Shop, Distributive and Allied Employees’ Association’s financial report is appropriate. KPMG Amanda Bond Partner Tower Two, Collins Square, 727 Collins Street, Melbourne 22 August 2019 Registered Auditor – Fair Work (Registered Organisations) Act 2009, #AA2019/11
leAD AuDitor’S inDepenDence DeclArAtion to the memberS of the Shop, DiStributive AnD AllieD employeeS’ ASSociAtion I declare that, to the best of my knowledge and belief, in relation to the audit of Shop, Distributive and Allied Employees’ Association for the financial year ended 30 June 2019 there have been: 1. no contraventions of any applicable code of professional conduct in relation to the audit. KPMG Amanda Bond Partner Tower Two, Collins Square, 727 Collins Street, Melbourne 22 August 2019 Registered Auditor – Fair Work (Registered Organisations) Act 2009, #AA2019/11 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. Liability limited by a scheme approved under Professional Standards Legislation.
SDA NEWS f spring 2019 f PAGE 31
SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES’ ASSOCIATION, NSW BRANCH ABN 74 415 123 375 FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2019 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES’ ASSOCIATION NSW BRANCH
Opinion I have audited the financial report of Shop, Distributive and Allied Employees’ Association NSW Branch (the Reporting Unit), which comprises the statement of financial position as at 30 June 2019, the statement of comprehensive income, statement of changes in equity, and statement of cash flows for the year ended 30 June 2019, notes to the financial statements, including a summary of significant accounting policies; the Committee of Management Statement, the subsection 255(2A) report and the Officer Declaration Statement. In my opinion, the accompanying financial report presents fairly, in all material aspects, the financial position of the Shop, Distributive and Allied Employees’ Association NSW Branch as at 30 June 2019 and its financial performance and its cash flows for the year ended on that date in accordance with: a) the Australian Accounting Standards; and b) any other requirements imposed by the Reporting Guidelines or Part 3 of Chapter 8 of the Fair Work (Registered Organisations) Act 2009 (the RO Act). I declare that management’s use of the going concern basis in the preparation of the financial statements of the Reporting Unit is appropriate. Basis for Opinion I conducted my audit in accordance with Australian Auditing Standards. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Report section of my report. I am independent of the Reporting Unit in accordance with 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 my audit of the financial report in Australia. I have also fulfilled my other ethical responsibilities in accordance with the Code. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Information Other than the Financial Report and Auditor’s Report Thereon The Committee of Management is responsible for the other information. The other information obtained at the date of this auditor’s report is in the Operating Report accompanying the financial report. My opinion on the financial report does not cover the other information and accordingly I do not express any form of assurance conclusion thereon. In connection with my audit of the financial report, my responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or my knowledge obtained in the audit or otherwise appears to be materially misstated. If, based on the work I have performed, I conclude that there is a material misstatement of this other information, I am required to report that fact. I have nothing to report in this regard. Responsibilities of Committee of Management for the Financial Report The Committee of Management of the Reporting Unit is responsible for the preparation of the financial report that gives a true and fair view in accordance with Australian Accounting Standards and the RO Act, and for such internal control as the Committee of Management determine is necessary to enable the preparation of the 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 Committee of Management is responsible for assessing the Reporting Unit’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 Committee of Management either intend to liquidate the Reporting Unit or to cease operations, or have no realistic alternative but to do so. Auditor’s Responsibilities for the Audit of the Financial Report My objective is 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 my 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. As part of an audit in accordance with the Australian Auditing Standards, I exercise professional judgement and maintain professional scepticism throughout the audit. I also: l Identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. l Obtain an understanding of internal control relevant to the audit 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 Reporting Unit’s internal control. l Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Committee of Management. l Conclude on the appropriateness of the Committee of Management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Reporting Unit’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the Reporting Unit to cease to continue as a going concern. l Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. l Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Reporting Unit to express an opinion on the financial report. I am responsible for the direction, supervision and performance of the Reporting Unit audit. I remain solely responsible for my audit opinion. I communicate with the Committee of Management regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit. Recovery of Wages The Reporting Unit does not engage in the recovery of wages activity. Joseph Paul Grech Grech Smith Bridle Partner Chartered Accountants Registration Number: AA2017/26 (as registered by the RO Commissioner under the RO Act) Holder of Current Practicing Certificate and Member of the Chartered Accountants Australia and New Zealand Number 24310 Dated at Sydney this 20th day of August 2019 DeClARATIOn I, Joseph Paul Grech, being the auditor of the Shop, Distributive and Allied Employees’ Association NSW Branch declare that: a) I am an auditor registered under the RO Act, and b) I am a person who is a member of Chartered Accountants Australia and New Zealand; and c) I hold a current Public Practice Certificate. Joseph Paul Grech Grech Smith Bridle Partner Chartered Accountants Registration Number: AA2017/26 (as registered by the RO Commissioner under the RO Act) Holder of Current Practicing Certificate and Member of the Chartered Accountants Australia and New Zealand Number 24310 Dated at Sydney this 20th day of August 2019
PAGE 32 f spring 2019 f SDA NEWS
AUDITOR’S INDEPENDENCE DECLARATION FOR THE YEAR ENDED 30 JUNE 2019 TO THE COMMITTEE OF MANAgEMENT OF SHOP, DISTRIBUTIVE AND ALLIED EMPLOYEES’ ASSOCIATION NSW BRANCH
I declare that, to the best of my knowledge and belief, during the year ended 30 June 2019 there has been: (i) no contraventions of the auditor independence requirements in relation to the audit; and (ii) no contravention of any applicable code of professional conduct in relation to the audit. Joseph Paul Grech Grech Smith Bridle Partner Chartered Accountants Registration Number: AA2017/26 (as registered by the RO Commissioner under the RO Act) Holder of Current Practicing Certificate and Member of the Chartered Accountants Australia and New Zealand Number 24310 Dated at Sydney this 20th day of August 2019
REPORT REqUIRED UNDER SUBSECTION 255(2A) FOR THE YEAR ENDED 30 JUNE 2019
The Committee of Management presents the expenditure report as required under subsection 255(2A) on the Reporting Unit for the year ended 30 June 2019. Categories of expenditure 2019 $ 2018 $ Remuneration and other employment-related costs and expenses - employees 8,042,944 7,550,982 Advertising 424,535 743,888 Operating costs 8,400,812 8,088,035 Donations to political parties 151,849 1,627 Legal costs 216,032 212,836 name and title of designated officer: Bernie Smith, Secretary/Treasurer Dated: 20 August 2019
OPERATINg REPORT FOR THE YEAR ENDED 30 JUNE 2019
The Committee of Management presents its operating report on the Reporting Unit for the financial year ended 30 June 2019. Review of principal activities, the results of those activities and any significant changes in the nature of those activities during the year The principal activities of the association are preserving and enhancing the wages and working conditions of its members, and the promotion of the interests and rights of workers. In addition to industrial representation, members are also provided with a range of services and benefits. New enterprise agreements were negotiated with a wide range of employers during the year. These agreements all resulted in improved wages and working conditions for the employees covered by them. Significant changes in financial affairs There were no significant changes in the nature of the activities and financial affairs in the Association during the financial year. Rights of members to resign Persons eligible to do so under the rules of the Association were actively encouraged to join the Association. Pursuant to s174 of the Fair Work (Registered Organisations) Act 2009 (RO Act), members could resign from the Association by written notice to the appropriate Branch of the Association. Officers & employees who are superannuation fund trustees or director of a company that is a superannuation fund trustee Representatives of the Branch hold a position as the Alternative Directors of the Retail Employees’ Superannuation Trust (“REST”). Gerard Dwyer and Aliscia Di Mauro act as the alternative director for Joe de Bruyn and Geoff Williams. Directors Alternates Mr Joe de Bruyn Mr Gerard Dwyer Mr Ian Blandthorn Ms Aliscia Di Mauro number of Members Membership as at 30 June 2019 was 56,922 (2018: 59,474). number of employees At 30 June 2019, there were 69 persons (full time equivalent), employed by the NSW Branch of the Association. Affiliations & Directorships Detailed below are the affiliations of the NSW Branch of the Association: — Australian Labor Party, NSW Branch — Australian Labor Party, ACT Branch — Unions NSW — South Coast Labor Council — Unions ACT The NSW Branch Secretary-Treasurer is on the Administrative Committee of the Australian Labor Party NSW Branch. The NSW Branch Secretary-Treasurer of the Association is an Executive Member of Unions NSW. A representative of the NSW Branch of the Association is a member of the Service Skills NSW Wholesale, Retail and Personal Services Committee. names of Committee of Management members and period positions held during the financial year The following members held positions on the Branch’s Committee of Management for the entire reporting period unless indicated otherwise: Name Position C. Cassell Branch President - until 12 December 2018 Resigned 12 December 2018 M. Dumycz Branch President - from 12 December 2018 Branch Vice President - until 12 December 2018 C. Williams Branch Vice President - from 12 December 2018 Branch Councillor - until 12 December 2018 (Branch membership) B. Smith Branch Secretary – Treasurer R. Tonkli Branch Assistant Secretary – Treasurer M. Hagley Branch Trustee Resigned 12 December 2018 H. Thomas Branch Trustee Resigned 12 December 2018 A. Manos Branch Trustee - from 12 December 2018 Branch Councillor - until 12 December 2018 (Branch membership) J. Slender Branch Trustee - from 12 December 2018 Branch Councillor - until 12 December 2018 (Branch membership) M. Doherty Branch Councillor (Retail membership) Resigned 12 December 2018 S. Sammak Branch Councillor (Drug and Allied membership) D. Robins Branch Councillor (Other Industries and Vocational Grouping membership) Resigned 12 December 2018 S. Barros Branch Councillor (Branch membership) from 12 December 2018 Branch Councillor (Retail membership) until 12 December 2018 P. Avellino Branch Councillor (Branch membership) Resigned 12 December 2018 N. Rizk Branch Councillor (Retail membership) A. Apps Branch Councillor (Branch membership) N. Atkins Branch Councillor (Branch membership) Resigned 12 December 2018 M. Hackett Branch Councillor (Branch membership) Resigned 12 December 2018 V. Bollen Branch Councillor (Branch membership) Appointed 12 December 2018 P. Boltjes Branch Councillor (Branch membership) Appointed 12 December 2018 S. Funge Branch Councillor (Branch membership) Appointed 12 December 2018 J. Wright Branch Councillor (Branch membership) Appointed 12 December 2018 C. Yarwood Branch Councillor (Branch membership) Appointed 12 December 2018 C. Dufty Branch Councillor (Retail membership) Appointed 12 December 2018 D. Tyrrell Branch Councillor (Retail membership) Appointed 12 December 2018 M. Kraaymaat Branch Councillor (Other Industries and Vocational Groupings membership) Appointed 12 December 2018 The Association maintained its rules and reported according to statutory requirements. Bernie Smith Robert Tonkli Committee of Management Committee of Management Dated at Sydney this 20th day of August 2019
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$ 982 88 035 7 36
COMMITTEE OF MANAgEMENT STATEMENT FOR THE YEAR ENDED 30 JUNE 2019
On 20 August 2019 the Committee of Management of Shop, Distributive and Allied Employees’ Association NSW Branch passed the following resolution in relation to the general-purpose financial report (GPFR) for the year ended 30 June 2019: The Committee of Management declares that in its opinion: a) The financial statements and notes comply with the Australian Accounting Standards; b) The financial statements and notes comply with any other requirements imposed by the Reporting Guidelines or Part 3 of Chapter 8 of the Fair Work (Registered Organisations) Act 2009 (the RO Act); c) The financial statements and notes give a true and fair view of the financial performance, financial position and cash flows of the reporting unit for the financial year to which they relate; d) There are reasonable grounds to believe the reporting unit will be able to pay its debts as and when they become due and payable; and e) During the financial year to which the GPFR relates and since the end of that year: i) Meetings of the Committee of Management were held in accordance with the rules of the organisation including the rules of a branch concerned; and ii) The financial affairs of the reporting unit have been managed in accordance with the rules of the organisation including the rules of a branch concerned; and iii) The financial records of the reporting unit have been kept and maintained in accordance with the RO Act; and iv) Where the organisation consists of two or more reporting units, the financial records of the reporting unit have been kept, as far as practicable, in a consistent manner with each of the other reporting units of the organisation; and v) Where information has been sought in any request by a member of the reporting unit or Commissioner duly made under section 272 of the RO Act has been provided to the member or Commissioner; and vi) Where any orders for inspection of financial records have been made by the Fair Work Commission under section 273 of the RO Act, there has been compliance. This declaration is made in accordance with a resolution of the Committee of Management. name and title of designated officer: Bernie Smith, Secretary-Treasurer Dated: 20 August 2019
STATEMENT OF PROFIT OR LOSS AND OTHER COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2019 Notes
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2019 $
Revenue Membership subscription 17,271,794 Interest 3A 336,841 Rental revenue 3B 1,101,814 Other revenue 77,716 18,788,165 Total revenue Other Income Net gains from sale of assets 3C 90,901 90,901 Total other income 18,879,066 Total income expenses Employee expenses 4A 8,042,944 Affiliation fees 4B 2,185,882 Administration expenses 4C 7,665,629 Grants or donations 4D 190,306 Depreciation 4E 760,669 Legal costs 4F 216,032 Audit fees 14 50,996 19,112,458 Total expenses (233,392) Profit/(loss) for the year Other comprehensive income Items that will not be subsequently reclassified to profit or loss Gain on revaluation of land & buildings (233,392) Total comprehensive income/(loss) for the year The above statement should be read in conjunction with the notes.
2018 $
17,137,065 204,122 1,227,379 50,159 18,618,725 155,905 155,905 18,774,630 7,550,982 2,144,046 7,400,881 16,380 755,857 212,836 52,800 18,133,782 640,848 2,985,559 3,626,407
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2018 2018
2018 2018 2018
2018 2018 r 2018 r 2018 r 2018 r 2018 r 2018 r 2018 r 2018 r 2018
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Notes General funds $ Retained earnings $ Balance as at 1 July 2017 17,434,594 33,700,739 Adjustment for errors Adjustment for changes in accounting policies Profit or (Loss) for the year 640,848 Other comprehensive income for the year Transfer to/from Asset Revaluation Reserve 10A 2,985,559 Transfer from retained earnings Closing balance as at 30 June 2018 20,420,153 34,341,587 Adjustment for errors Adjustment for changes in accounting policies 1 (15,627) Profit or (Loss) for the year (233,392) Other comprehensive income for the year Transfer to/from Asset Revaluation Reserve 10A Transfer from retained earnings 20,420,153 34,092,568 Closing balance as at 30 June 2019 The above statement should be read in conjunction with the notes.
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2019
Notes 2019 $ OPeRATInG ACTIVITIeS Cash received Receipts from other reporting units/controlled entity(s) 11B 36,161 Interest 279,271 Other 20,583,103 Cash used Employees (7,996,511) Suppliers (9,509,709) Payment to other reporting units/controlled entity(s) 11B (2,399,296) 11A 993,019 net cash from (used by) operating activities InVeSTInG ACTIVITIeS Cash received Proceeds from sale of plant and equipment 158,221 Proceeds from sale of land and buildings Other 596,228 Cash used Purchase of plant and equipment (517,515) Purchase of land and buildings Purchase of financial assets (253,519) Other (231,000) (247,585) net cash from (used by) investing activities FInAnCInG ACTIVITIeS Cash received Contributed equity Other Cash used Repayment of borrowings Other net cash from (used by) financing activities 745,434 net increase (decrease) in cash held Cash & cash equivalents at the beginning of the reporting period 1,434,563 5A 2,179,997 Cash & cash equivalents at the end of the reporting period The above statement should be read in conjunction with the notes.
Total equity $ 51,135,333 640,848 2,985,559 54,761,740 (15,627) (233,392) 54,512,721
2018 $ 30,708 204,122 19,643,242 (7,523,413) (9,091,527) (2,441,811) 821,321 228,635 474,380 (547,477) (1,646,480) (193,402) (1,684,344) 863,023 2,297,586 1,434,563
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 30 JUNE 2019
STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2019
ASSeTS Current Assets Cash and cash equivalents 5A 2,179,997 Trade and other receivables 5B 1,682,767 Financial assets 6 9,700,000 Other current assets 5C 1,184,312 14,747,076 Total current assets non-Current Assets Financial assets 6 1,500,000 Land and buildings 7A 11,850,925 Plant and equipment 7B 1,079,558 Investment Property 7C 28,901,419 Other non-current assets 7D 5,576 43,337,478 Total non-current assets 58,084,554 Total assets lIABIlITIeS Current liabilities Trade payables 8A 878,870 Other payables 8B 153,846 Employee provisions 9A 2,520,063 3,552,779 Total current liabilities non-Current liabilities Employee provisions 9A 19,054 19,054 Total non-current liabilities 3,571,833 Total liabilities 54,512,721 net assets eQUITY General funds 10A 20,420,153 Retained earnings 34,092,568 54,512,721 Total equity The above statement should be read in conjunction with the notes.
STATEMENT OF CHANgES IN EqUITY FOR THE YEAR ENDED 30 JUNE 2019
1,434,563 1,663,366 9,446,481 1,392,538 13,936,948 1,500,000 12,155,263 1,008,725 29,266,647 5,054 43,935,689 57,872,637 621,348 11,617 2,458,670 3,091,635 19,262 19,262 3,110,897 54,761,740 20,420,153 34,341,587 54,761,740
NOTE 1: SUMMARY OF SIgNIFICANT ACCOUNTINg POLICIES 1.1 Basis of preparation of the financial statements The financial statements are general purpose financial statements and have been prepared in accordance with Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period and the Fair Work (Registered Organisation) Act 2009. For the purpose of preparing the general purpose financial statements, the Shop, Distributive and Allied Employees’ Association NSW Branch is a not-for-profit entity. The financial statements have been prepared on an accrual basis and in accordance with the historical cost, except for certain assets and liabilities at measured at fair value, as explained in the accounting policies below. Historical cost is generally based on the fair values of the consideration given in exchange for assets. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars. 1.2 comparative amounts When required by Accounting Standards, comparative figures have been adjusted to conform to changes in presentation for the current financial year. 1.3 significant accounting judgements and estimates The Committee of Management evaluates estimates and judgments incorporated into the financial report based on historical knowledge and best available current information. Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the Association. Key Judgements (i) Employee Benefits For the purpose of measurement, AASB 119: Employee Benefits defines obligations for short-term employee benefits as obligations expected to be settled wholly before 12 months after the end of the annual reporting period in which the employees render the related service. As the Association expects that all its employees would use all their annual leave entitlements earned during a reporting period before 12 months after the end of the reporting period, the Committee of Management considers that obligations for annual leave entitlements satisfy the definition for short-term employee benefits, and therefore, can be measured at the (undiscounted) amounts expected to be paid to employees when the obligations are settled. Key estimates (i) Impairment of Investment Properties Investment properties were independently valued at 30 June 2017 by LandMark White (Sydney) Pty Ltd. The valuation was based on the fair value less costs of disposal. The critical assumptions adopted in determining the valuation included the location of the investment properties, rental returns of similar investment properties, sales demand in the area, and recent sales data for similar investment properties. The valuation resulted in a revaluation increment of $11,751,171 being recognised for the year end 30 June 2017. At 30 June 2019, the Committee of Management reviewed the key assumptions made by the valuers at 30 June 2017. They have concluded that these assumptions remain materially unchanged and are satisfied that the carrying amount does not exceed the recoverable amount investment properties at 30 June 2019. (ii) Impairment of Plant & Equipment The Association assess impairment of plant & equipment at the end of each reporting period by evaluating the conditions and events specific to the Association that may be indicative of impairment triggers. Recoverable amounts of relevant plant and equipment are reassessed using value-in-use calculations which incorporate various key assumptions. No impairment has been recognised in respect of plant & equipment at the end of the reporting period. As at 30 June 2019, plant & equipment is carried in the statement of financial position at a written down value of $1,079,558.
SDA NEWS f spring 2019 f PAGE 33
1.4 changes to comparative figures In accordance with AASB 108: Accounting Policies, Changes in Accounting Estimates and Errors the Association has restated the presentation of comparative figures for cash and cash equivalents and financial assets as shown on the Statement of Financial Position. Short-term and medium-term deposits were presented as cash and cash equivalents on the statement of financial position in previous periods. It was noted that these instruments have a maturity profile of more than three months, and thus do not meet the definition of cash or cash equivalents but rather that of financial assets. This has been rectified by restating each of the affected financial statement line items for prior periods as follows: 30 June 2018 30 June 2017 Statement of note: Previous Adjustment Restated Previous Adjustment Restated financial position: Amount amount Amount amount $ $ $ $ $ $ 5A Cash & cash equivalents - Current 10,881,044 (9,446,481) 1,434,563 10,097,587 (7,800,001) 2,297,586 - Non-current 1,500,000 (1,500,000) 1,500,000 (1,500,000) 6 Financial assets - Current 9,446,481 9,446,481 7,800,001 7,800,001 - Non-current 1,500,000 1,500,000 1,500,000 1,500,000 There was no impact on the financial performance of the Association. 1.5 new australian accounting standards Adoption of New Australian Accounting Standard Requirements No accounting standard has been adopted earlier than the application date stated in the standard. The accounting policies adopted are consistent with those of the previous financial year except for the following standards and amendments, which have been adopted for the first time this financial year: • AASB 9 Financial Instruments and relevant amending standards, which replaces AASB 139 Financial Instruments: Recognition and measurement. The Impact of applying this standard is discussed further below. • AASB 2017-1 Amendments of Australian Accounting Standards – Transfers of Investment Property, Annual Improvements 2014-2016 Cycle and other amendments, which clarify certain requirements in: - AASB 140 Investment Property – Change in use The adoption of this of this amendment did not have an impact on the Shop, Distributive and Allied Employees’ Association NSW Branch. Impact on adoption of AASB 9 (a) Initial application AASB 9 Financial Instruments (AASB 9) replaces AASB139 Financial Instruments: Recognition and Measurement (AASB 139) for annual periods beginning on or after 1 January 2018, bringing together all three aspects of the accounting for financial instruments: 1. classification and measurement; 2. impairment; and 3. hedge accounting. The Shop, Distributive and Allied Employees’ Association NSW Branch has applied AASB 9 retrospectively, with an initial application date of 1 July 2018. The Shop, Distributive and Allied Employees’ Association NSW Branch has not restated the comparative information, which continues to be reported under AASB 139. Differences arising from the adoption of AASB 9 have been recognised directly in opening retained earnings and other components of equity as at 1 July 2018. The nature and effect of the changes as a result of adoption of AASB 9 are as follows: Impact on the statement of financial position (increase/(decrease)): Ref adjustments 1 July 2018 $ Classification and measurement (i) Impairment (ii) (15,627) Other adjustments (iii) (15,627) Ref adjustments 1 July 2018 $ Assets Trade and other receivables (ii) (15,627) Other assets (ii), (iii) Total assets Total adjustments on equity Retained earnings (ii) (15,627) Other components of equity (iii) The nature of these adjustments are described below. i) Classification and measurement Under AASB 9, debt instruments are subsequently measured at fair value through profit or loss, amortised cost, or fair value through OCI. The classification is based on two criteria: the Shop, Distributive and Allied Employees’ Association NSW Branch’s business model for managing the assets; and whether the instruments’ contractual cash flows represent ‘solely payments of principal and interest’ on the principal amount outstanding. The assessment of the Shop, Distributive and Allied Employees’ Association NSW Branch’s business model was made as of the date of initial application, 1 July 2018. The assessment of whether contractual cash flows on debt instruments are solely comprised of principal and interest was made based on the facts and circumstances as at the initial recognition of the assets. The classification and measurement requirements of AASB 9 did not have a significant impact to the Shop, Distributive and Allied Employees’ Association NSW Branch. - Trade receivables and other current and non-current financial assets (i.e. term deposits) previously classified as loans and receivables are held to collect contractual cash flows and give rise to cash flows representing solely payments of principal and interest. These are now classified and measured as debt instruments at amortised cost. The Shop, Distributive and Allied Employees’ Association N.S.W. Branch has not designated any financial liabilities as at fair value through profit or loss. There are no changes in classification and measurement for the Shop, Distributive and Allied Employees’ Association NSW Branch financial liabilities. In summary, upon adoption of AASB 9, the Shop, Distributive and Allied Employees’ Association NSW Branch applied the following required or elected reclassifications: 1 July 2018 AASB 9 measurement category Fair Value Amortised Fair Value through Cost through profit or loss OCI $ $ $ $ AASB 139 measurement category Loans & receivables - Cash & cash equivalents 1,434,563 1,434,563 - Trade & other receivables 1,663,336 1,663,336 Available-for-sale - Financial assets 10,946,481 10,946,481 ii) Impairment loss The adoption of AASB 9 has fundamentally changed the Shop, Distributive and Allied Employees’ Association NSW Branch’s accounting for impairment losses for financial assets by replacing AASB 139’s incurred loss approach with a forward-looking expected credit loss (ECL) approach. AASB 9 requires the Shop, Distributive and Allied Employees’ Association NSW Branch to recognise an allowance for ECLs for all debt instruments not held at fair value through profit or loss and contract assets, i.e. those held at amortised cost and at FVTOCI. Set out below is the reconciliation of the ending impairment allowances in accordance with AASB 139 to the opening loss allowances determined in accordance with AASB 9. Allowance for impairment Remeasurement ECL under AASB 9 under AASB 139 as at 1 July 2018 as at 30 June 2019 Trade Receivables 15,627 15,627
PAGE 34 f spring 2019 f SDA NEWS
(iii) Other adjustments The adoption of AASB 9: Financial Instruments has not resulted in any other adjustments to the financial performance, position or presentation of the Shop, Distributive and Allied Employees’ Association NSW Branch. Future Australian Accounting Standards Requirements New standards, amendments to standards or interpretations that were issued prior to the sign-off date and are applicable to future reporting periods that are expected to have a future financial impact on Shop, Distributive and Allied Employees’ Association NSW Branch include: AASB 16 Leases (AASB 16) AASB 16 was issued in January 2016 and it replaces AASB 117 Leases, AASB Interpretation 4 Determining whether an Arrangement contains a Lease, AASB Interpretation-115 Operating Leases-Incentives and AASB Interpretation 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease. For NFP entities, AASB 16 will commence from financial years beginning on or after 1 January 2019. Either a full retrospective application or a modified retrospective application is required for AASB 16. The Shop, Distributive and Allied Employees’ Association NSW Branch plans to adopt AASB 16 on the required effective date of 1 July 2019 using modified retrospective method. AASB 16 sets out the principles for the recognition, measurement, presentation and disclosure of leases and requires lessees to account for all leases under a single on-balance sheet model similar to the accounting for finance leases under AASB 117. The standard includes two recognition exemptions for lessees – leases of ’low-value’ assets (e.g. personal computers) and short-term leases (i.e. leases with a lease term of 12 months or less). At the commencement date of a lease, a lessee will recognise a liability to make lease payments (i.e. the lease liability) and an asset representing the right to use the underlying asset during the lease term (i.e. the right-of-use asset). Lessees will be required to separately recognise the interest expense on the lease liability and the depreciation expense on the right-of-use asset. Lessees will be also required to remeasure the lease liability upon the occurrence of certain events (e.g. a change in the lease term, a change in future lease payments resulting from a change in an index or rate used to determine those payments). The lessee will generally recognise the amount of the remeasurement of the lease liability as an adjustment to the right-of-use asset. Lessor accounting under AASB 16 is substantially unchanged from today’s accounting under AASB 117. Lessors will continue to classify all leases using the same classification principle as in AASB 117 and distinguish between two types of leases: operating and finance leases. During the financial year ended 30 June 2019, the Shop, Distributive and Allied Employees’ Association NSW Branch performed a preliminary assessment of AASB 16. The Association has performed a preliminary impact assessment and has estimated that on 1 July 2019, it expects to recognise the right-of-use assets and lease liabilities of $530,781 (after adjusting for prepayments and accrued lease payments recognised at 30 June 2019). Following the adoption of this standard, the Association’s net profit is expected to decrease by approximately $8,597. The repayment of the principal portion of the lease liabilities will be classified as cash flows from financing activities, thus increasing operating cash flows and decreasing financing cash flows by approximately $212,510 in 2020. AASB 1058 Income of Not-for-Profit Entities (AASB 1058) and AASB 15 Revenue from Contracts with Customers (AASB 15) AASB 1058 clarifies and simplifies the income recognition requirements that apply to not-for-profit (nFP) entities in conjunction with AASB 15. AASB 1058 and AASB 15 supersede all the income recognition requirements relating to private sector NFP entities, and the majority of income recognition requirements relating to public sector NFP entities, previously in AASB 1004 Contributions. For NFP entities, both AASB 1058 and AASB 15 will commence from financial years beginning on or after 1 January 2019. Either a full retrospective application or a modified retrospective application is required for AASB 15. The Shop, Distributive and Allied Employees’ Association N.S.W. Branch plans to adopt AASB 15 on the required effective date 1 July 2019 of using modified retrospective method. During the financial year ended 30 June 2019, the Shop, Distributive and Allied Employees’ Association NSW Branch performed a preliminary assessment of AASB 1058 and AASB 15. Subscription revenue Subscription fees are accounted for on an accrual basis under AASB 118: Revenue and are recorded in the financial year to which it relates. Based on its assessment, the Association does not expect the application of AASB to have a significant impact on its financial statements for subscription revenue. Rental income Rental income from investment property is recognised in profit or loss on a straight-line basis over the term of the lease. Based on its assessment, the Association does not expect the application of AASB 15 to have a significant impact on its financial statement for rental income. As the Association intends to adopt AASB 15 under the modified retrospective method, it has assessed the cumulative effect of retrospective application to incomplete contracts on the date of application (1 July 2019) as $nil. AASB 2017-6 Amendments to Australian Accounting Standards – Prepayment Features with Negative Compensation The amendments to AASB 9 clarify that a financial asset passes the solely payments of principal and interest criterion regardless of the event or circumstance that causes the early termination of the contract and irrespective of which party pays or receives reasonable compensation for the early termination of the contract. The amendments apply retrospectively and are effective from 1 January 2019, with earlier application permitted. These amendments have no impact on the financial statements of the Shop, Distributive and Allied Employees’ Association NSW Branch. 1.6 revenue Revenue is measured at the fair value of the consideration received or receivable. Revenue from subscriptions is accounted for on an accrual basis and is recorded as revenue in the year to which it relates. Revenue from the sale of goods is recognised when, the risks and rewards of ownership have been transferred to the buyer, the entity retains no managerial involvement or effective control over the goods, the revenue and transaction costs incurred can be reliably measured, and it is probable that the economic benefits associated with the transaction will flow to the entity. Receivables for goods and services, which have 30-day terms, are recognised at the nominal amounts due less any less any loss allowance due to expected credit losses at each reporting date. A provision matrix that is based on historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment has been established. Interest revenue is recognised on an accrual basis using the effective interest method. Rental revenue from operating leases is recognised on a straight-line basis over the term of the relevant lease. 1.7 gains Sale of assets Gains and losses from disposal of assets are recognised when control of the asset has passed to the buyer. 1.8 capitation fees and levies Capitation fees and levies are to be recognised on an accrual basis and record as a revenue and/or expense in the year to which it relates. 1.10 employee Benefits A liability is recognised for benefits accruing to employees in respect of wages and salaries, annual leave, long service leave and termination benefits when it is probable that settlement will be required, and they are capable of being measured reliably. Liabilities for short-term employee benefits (as defined in AASB 119 Employee Benefits) and termination benefits which are expected to be settled within twelve months of the end of reporting period are measured at their nominal amounts. The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability. Other long-term employee benefits which are expected to be settled beyond twelve months are measured as the present value of the estimated future cash outflows to be made by the reporting unit in respect of services provided by employees up to reporting date. Payments to defined contribution retirement benefit plans are recognised as an expense when employees have rendered service entitling them to the contributions. Provision is made for separation and redundancy benefit payments. Reporting Unit recognises a provision for termination as part of a broader restructuring when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations. A provision for voluntary termination is recognised when the employee has accepted the offer of termination. 1.11 leases Leases are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership to the lessee. All other leases are classified as operating leases. Where an asset is acquired by means of a finance lease, the asset is capitalised at either the fair value of the lease property or, if lower, the present value of minimum lease payments at the inception of the contract and a liability is recognised at the same time and for the same amount. The discount rate used is the interest rate implicit in the lease. Leased assets are amortised over the period of the lease.
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Lease payments are allocated between the principal component and the interest expense. Operating lease payments are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets. Rental revenue from operating leases is recognised on a straight-line basis over the term of the relevant lease. Initial direct costs incurred in negotiating and arranging an operating lease are added to the carrying amount of the leased asset and recognised on a straight-line basis over the lease term. 1.13 cash Cash is recognised at its nominal amount. Cash and cash equivalents includes cash on hand, deposits held at call with bank, other short-term highly liquid investments with original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value and bank overdrafts. Bank overdrafts are shown within short-term borrowings in current liabilities on the statement of financial position. 1.14 financial instruments Financial assets and financial liabilities are recognised when Shop, Distributive and Allied Employees’ Association NSW Branch becomes a party to the contractual provisions of the instrument. 1.15 financial assets Initial recognition and measurement Financial assets are classified, at initial recognition, and subsequently measured at amortised cost, fair value through other comprehensive income (OCI), or fair value through profit or loss. The classification of financial assets at initial recognition depends on the financial asset’s contractual cash flow characteristics and the Shop, Distributive and Allied Employees’ Association NSW Branch’s business model for managing them. With the exception of trade receivables that do not contain a significant financing component, the Shop, Distributive and Allied Employees’ Association NSW Branch initially measures a financial asset at its fair value plus, in the case of a financial asset not at fair value through profit or loss, transaction costs. In order for a financial asset to be classified and measured at amortised cost or fair value through OCI, it needs to give rise to cash flows that are ‘solely payments of principal and interest’ (SPPI) on the principal amount outstanding. This assessment is referred to as the SPPI test and is performed at an instrument level. The Shop, Distributive and Allied Employees’ Association NSW Branch’s business model for managing financial assets refers to how it manages its financial assets in order to generate cash flows. The business model determines whether cash flows will result from collecting contractual cash flows, selling the financial assets, or both. Purchases or sales of financial assets that require delivery of assets within a time frame established by regulation or convention in the marketplace (regular way trades) are recognised on the trade date, i.e., the date that the Shop, Distributive and Allied Employees’ Association NSW Branch commits to purchase or sell the asset. Subsequent measurement For purposes of subsequent measurement, financial assets are classified in five categories: • (Other) financial assets at amortised cost • (Other) financial assets at fair value through other comprehensive income • Investments in equity instruments designated at fair value through other comprehensive income • (Other) financial assets at fair value through profit or loss • (Other) financial assets designated at fair value through profit or loss Financial assets at amortised cost The Shop, Distributive and Allied Employees’ Association NSW Branch measures financial assets at amortised cost if both of the following conditions are met: • The financial asset is held within a business model with the objective to hold financial assets in order to collect contractual cash flows and • The contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding Financial assets at amortised cost are subsequently measured using the effective interest (eIR) method and are subject to impairment. Gains and losses are recognised in profit or loss when the asset is derecognised, modified or impaired. The Shop, Distributive and Allied Employees’ Association NSW Branch’s financial assets at amortised cost includes trade receivables, short-term deposits and medium-term deposits with financial institutions. Derecognition A financial asset is derecognised when: • The rights to receive cash flows from the asset have expired or • The Shop, Distributive and Allied Employees’ Association NSW Branch has transferred its rights to receive cash flows from the asset or has assumed an obligation to pay the received cash flows n full without material delay to a third party under a ‘pass-through’ arrangement; and either: a) the Shop, Distributive and Allied Employees’ Association NSW Branch has transferred substantially all the risks and rewards of the asset; or b) the Shop, Distributive and Allied Employees’ Association NSW Branch has neither transferred nor retained substantially all the risks and rewards of the asset but has transferred control of the asset. When the Shop, Distributive and Allied Employees’ Association NSW Branch has transferred its rights to receive cash flows from an asset or has entered into a pass-through arrangement, it evaluates if, and to what extent, it has retained the risks and rewards of ownership. When it has neither transferred nor retained substantially all of the risks and rewards of the asset, nor transferred control of the asset, the Shop, Distributive and Allied Employees’ Association NSW Branch continues to recognise the transferred asset to the extent of its continuing involvement together with associated liability. Offsetting Financial assets and financial liabilities are offset, and the net amount is reported in the statement of financial position if there is a currently enforceable legal right to offset the recognised amounts and there is an intention to settle on a net basis, to realise the assets and settle the liabilities simultaneously. Impairment (i) Trade receivables For trade receivables that do not have a significant financing component, the Shop, Distributive and Allied Employees’ Association NSW Branch applies a simplified approach in calculating expected credit losses (eCls) which requires lifetime expected credit losses to be recognised from initial recognition of the receivables. Therefore, the Shop, Distributive and Allied Employees’ Association NSW Branch does not track changes in credit risk, but instead recognises a loss allowance based on lifetime ECLs at each reporting date. The Shop, Distributive and Allied Employees’ Association NSW Branch has established a provision matrix that is based on its historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment. (i) Debt instruments other than trade receivables For all debt instruments other than trade receivables and debt instruments not held at fair value through profit or loss, the Shop, Distributive and Allied Employees’ Association NSW Branch recognises an allowance for expected credit losses using the general approach. ECLs are based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Shop, Distributive and Allied Employees’ Association NSW Branch expects to receive, discounted at an approximation of the original effective interest rate. ECLs are recognised in two stages: • Where there has not been a significant increase in credit risk since initial recognition, ECLs are provided for credit losses from possible default events within the next 12-months (a 12-month ECL). • Where there has been a significant increase in credit risk since initial recognition, a loss allowance is required for credit losses expected over the remaining life of the debt, irrespective of the timing of the default (a lifetime ECL). The Shop, Distributive and Allied Employees’ Association NSW Branch considers a financial asset in default when contractual payments are 90 days past due. However, in certain cases, the Shop, Distributive and Allied Employees’ Association NSW Branch may also consider a financial asset to be in default when internal or external information indicates that the Shop, Distributive and Allied Employees’ Association NSW Branch is unlikely to receive the outstanding contractual amounts in full. A financial asset is written off when there is no reasonable expectation of recovering the contractual cash flows. 1.16 financial liaBilities Initial recognition and measurement Financial liabilities are classified, at initial recognition, at amortised cost or at fair value through profit or loss. All financial liabilities are recognised initially at fair value and, in the case of financial liabilities at amortised cost, net of directly attributable transaction costs. The Shop, Distributive and Allied Employees’ Association NSW Branch’s financial liabilities include trade and other payables. Subsequent measurement Financial liabilities at amortised cost After initial recognition, trade payables and interest-bearing loans and borrowings are subsequently measured at amortised cost using the EIR method. Gains and losses are recognised in profit or loss when the liabilities are derecognised as well as through the EIR amortisation process. Amortised cost is calculated by taking into account any discount or premium on acquisition and fees or costs that are an integral part of the EIR. The EIR amortisation is included as finance costs in profit or loss.
Derecognition A financial liability is derecognised when the obligation under the liability is discharged or cancelled or expires. When an existing financial liability is replaced by another from the same lender on substantially different terms, or the terms of an existing liability are substantially modified, such an exchange or modification is treated as the derecognition of the original liability and the recognition of a new liability. The difference in the respective carrying amounts is recognised in profit or loss. Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis. 1.17 contingent liaBilities and contingent assets Contingent liabilities and contingent assets are not recognised in the Statement of Financial Position but are reported in the relevant notes. They may arise from uncertainty as to the existence of a liability or asset or represent an existing liability or asset in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain, and contingent liabilities are disclosed when settlement is greater than remote. 1.18 land, Buildings, plant and equipment Asset recognition threshold Purchases of land, buildings, plant and equipment are recognised initially at cost in the Statement of Financial Position. The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. Revaluations—land and buildings Following initial recognition at cost, land and buildings are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Revaluations are performed with sufficient frequency such that the carrying amount of assets do not differ materially from those that would be determined using fair values as at the reporting date. Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the profit or loss except to the extent that they reverse a previous revaluation increment for that class. Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset is restated to the revalued amount. Depreciation Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful life using, in all cases, the straight-line method of depreciation. Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate. Depreciation rates applying to each class of depreciable asset are based on the following useful lives: 2019 2018 Land & Buildings 40 years 40 years Plant and equipment 4 to 40 years 4 to 40 years Derecognition An item of land, buildings, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or loss arising on the disposal or retirement of an item of property, plant and equipment is determined as the difference between the sales proceeds and the carrying amount of the asset and is recognised in the profit and loss. 1.19 investment property Investment properties are properties held to earn rentals and/or for capital appreciation (including property under construction for such purposes). Investment properties are measured initially at its cost, including transaction costs. Subsequent to initial recognition, investment properties are measured at fair value. Gains and losses arising from changes in the fair value of investment properties are included in profit and loss in the period in which they arise. An investment property is derecognised upon disposal or when the investment property is permanently withdrawn from use and no future economic benefits are expected from the disposal. Any gain or loss arising on derecognition of the property (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in profit or loss in the period in which the property is derecognised. 1.20 impairment for non-financial assets All assets are assessed for impairment at the end of each reporting period to the extent that there is an impairment trigger. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount. The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the Association were deprived of the asset, its value in use is taken to be its depreciated replacement cost. 1.21 non-current assets held for sale Non-current assets are classified as held for sale if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. This condition is regarded as met only when the sale is highly probable and the non-current asset is available for immediate sale in its present condition. Management must be committed to the sale, which should be expected to qualify for recognition as a completed sale within one year from the date of classification. Non-current assets classified as held for sale are measured at the lower of their previous carrying amount and fair value less costs of disposal. 1.22 taxation Shop, Distributive and Allied Employees’ Association NSW Branch is exempt from income tax under section 50.1 of the Income Tax Assessment Act 1997 however still has obligation for Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST). Revenues, expenses and assets are recognised net of GST except: l where the amount of GST incurred is not recoverable from the Australian Taxation Office; and l for receivables and payables. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables. Cash flows are included in the cash flow statement on a gross basis. The GST component of cash flows arising from investing and financing activities which is recoverable from, or payable to, the Australian Taxation Office is classified within operating cash flows. 1.23 fair value measurement The Shop, Distributive and Allied Employees’ Association NSW Branch measures financial instruments, such as financial assets as at fair value through the profit and loss, financial assets at fair value through OCI, and non-financial assets such as land and buildings and investment properties, at fair value at each balance sheet date. Also, fair values of financial instruments measured at amortised cost are disclosed in Note 16A. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value measurement is based on the presumption that the transaction to sell the asset or transfer the liability takes place either: l In the principal market for the asset or liability, or l In the absence of a principal market, in the most advantageous market for the asset or liability The principal or the most advantageous market must be accessible by the Shop, Distributive and Allied Employees’ NSW Branch. The fair value of an asset or a liability is measured using the assumptions that market participants would use when pricing the asset or liability, assuming that market participants act in their economic best interest. A fair value measurement of a non-financial asset takes into account a market participant’s ability to generate economic benefits by using the asset in its highest and best use or by selling it to another market participant that would use the asset in its highest and best use. The Shop, Distributive and Allied Employees’ Association NSW Branch uses valuation techniques that are appropriate in the circumstances and for which sufficient data are available to measure fair value, maximising the use of relevant observable inputs and minimising the use of unobservable inputs. All assets and liabilities for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole: l Level 1—Quoted (unadjusted) market prices in active markets for identical assets or liabilities l Level 2—Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable l Level 3—Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable
SDA NEWS f spring 2019 f PAGE 35
For assets and liabilities that are recognised in the financial statements on a recurring basis, the Shop, Distributive and Allied Employees’ Association NSW Branch determines whether transfers have occurred between levels in the hierarchy by re-assessing categorisation (based on the lowest level input that is significant to the fair value measurement as a whole) at the end of each reporting period. External valuers are involved for valuation of significant assets, such as land and buildings and investment properties. Selection criteria include market knowledge, reputation, independence and whether professional standards are maintained. For the purpose of fair value disclosures, the Shop, Distributive and Allied Employees’ Association NSW Branch has determined classes of assets and liabilities on the basis of the nature, characteristics and risks of the asset or liability and the level of the fair value hierarchy. 1.24 going concern Shop, Distributive and Allied Employees’ Association NSW Branch is not reliant on the agreed financial support of another reporting unit to continue on a going concern basis. Shop, Distributive and Allied Employees’ Association NSW Branch has not agreed to provide financial support to another reporting unit to ensure they can continue on a going concern basis. NOTE 2: EVENTS AFTER THE REPORTINg PERIOD There were no events that occurred after 30 June 2019, and/or prior to the signing of the financial statements, that would affect the ongoing structure and financial activities of Shop, Distributive and Allied Employees’ Association NSW Branch. 2018 $ NOTE 3: INCOME 2019 $ note 3a: interest income Deposits 204,122 336,841 Loans 204,122 336,841 Total interest note 3B: rental revenue Properties Investment 1,696,817 1,690,297 Other 4,942 7,745 Lease incentive (474,380) (596,228) Other 1,227,379 1,101,814 Total rental revenue note 3c: net gains from sale of assets Land and buildings Plant and equipment 155,905 90,901 Other 155,905 90,901 Total net gain from sale of assets NOTE 4: ExPENSES note 4a: employee expenses Holders of office: Wages and salaries 330,050 332,438 Superannuation 64,023 63,141 Leave and other entitlements Separation and redundancies 30,922 Other employee expenses 29,567 424,995 425,146 Subtotal employee expenses - holders of office employees other than office holders: Wages and salaries 5,242,297 5,580,447 Superannuation 559,342 596,996 Leave and other entitlements 669,729 740,010 Separation and redundancies 654,619 Other employee expenses 700,345 7,125,987 7,617,798 Subtotal employee expenses - employees other than office holders 7,550,982 8,042,944 Total employee expenses note 4B: affiliation fees SDA National Office 1,451,577 1,475,940 SDA National Office – International Fund 217,736 221,391 ALP NSW 259,841 267,409 ALP ACT 7,767 7,959 Labor Council NSW 201,894 206,140 Labor Council ACT 1,724 3,999 3,507 Labor Council South Coast 3,044 2,144,046 2,185,882 Total affiliation fees note 4c: administration expenses Consideration to employers for payroll deductions 289,099 85,286 Campaign levies - ACTU IR & others 528,300 185,699 Fees/allowances - meeting and conferences 139,955 181,418 Conference and meeting expenses 387,467 442,184 Accommodation & Travel 553,190 765,247 Contractors & Consultants 339,336 334,712 Impairment loss expense (875) Membership Propagation Expense 752,682 919,099 Journal Costs 486,684 530,529 Textbook, Scholarships & Teap Payments 56,834 51,759 Occupancy Expenses 1,002,329 1,202,016 Printing, Postage & Stationery 271,234 279,196 Telephone 162,247 187,448 Insurance 755,921 835,039 Motor Vehicle 489,947 520,919 832,005 Other 854,333 7,047,230 7,374,009 Subtotal administration expense Operating lease rentals: 353,651 Minimum lease payments 291,620 7,400,881 7,665,629 Total administration expenses note 4d: grants or donations Grants: Total paid that were $1,000 or less Total paid that exceeded $1,000 Donations: Total paid that were $1,000 or less 4,152 9,172 12,228 Total paid that exceeded $1,000 181,134 16,380 190,306 Total grants or donations note 4e: depreciation Land & buildings 246,915 304,338 508,942 Property, Plant and Equipment 456,331 755,857 760,669 Total depreciation note 4f: legal costs Litigation 8,131 5,575 204,705 Other legal matters 210,457 212,836 216,032 Total legal costs NOTE 5: CURRENT ASSETS note 5a: cash and cash equivalents Cash on hand 1,650 1,650 Cash at bank 1,432,913 2,178,347 Short term deposits 1,434,563 2,179,997 Total cash and cash equivalents
PAGE 36 f spring 2019 f SDA NEWS
note 5B: trade and other receivaBles Trade receivables Less allowance for expected credit loss
2018 $ 2019 $ 1,562,688 1,475,145 (14,752) 1,562,688 1,460,393 GST receivable 40,873 Accrued interest income 57,570 100,678 Other sundry receivables 123,931 100,678 222,374 1,663,366 1,682,767 Total Trade and other receivables The movement in the allowance for expected credit losses of trade and other receivables is as follows: Loss allowance at 1 July under AASB 139 AASB 9 transition adjustment 15,627 Opening losses allowance as at 1 July 15,627 Loss allowance recognised during the year (875) Write-off 14,752 At 30 June The opening loss allowance of $15,627 recognised under AASB 9 at 1 July 2018 has been taken directly to retained earnings. The Shop, Distributive and Allied Employees’ Association NSW Branch applies the simplified approach to providing for expected credit losses as prescribed by AASB 9, which permits the use of lifetime expected loss provision for all trade receivables. To measure expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due. The loss allowance provision as at 30 June 2019 is determined below. These expected credit losses also incorporate forward looking information. Current > 30 days > 60 days > 90 days Total 2019 past due past due past due Expected loss rate 1% 5% 10% 25% Gross carrying amount 1,697,519 1,697,519 Loss allowance provision (14,752) (14,752) Current > 30 days > 60 days > 90 days Total 2018 past due past due past due Expected loss rate 1% 5% 10% 25% Gross carrying amount 1,663,366 1,663,366 Loss allowance provision The opening loss allowance of $15,627 recognised under AASB 9 at 1 July 2018 has been taken directly to retained earnings. Credit Risk The Shop, Distributive and Allied Employees’ Association NSW Branch has no significant concentration of credit risk with respect to any single counterparty or group of counterparties other than those receivables specifically provided for and mentioned within Note 5B. The main sources of credit to the Association are considered to relate to the classes of assets described as “trade and other receivables”. The following table details the Association’s trade and other receivables exposed to credit risk (prior to collateral and other credit enhancements) with aging analysis and impairment provided thereon. Amounts are considered as “past due” when the debt has not been settled within the terms and conditions agreed between the Association and the customer or counterparty to the transaction. Receivables that are past due are assessed for impairment by ascertaining solvency of the debtors and are provided for where there are specific circumstances indicating the debt may not be fully repaid to the Association. The balances of receivables that remain within the initial trade terms (as detailed in the table below) are considered to be of high credit quality. Collateral No collateral is held over trade and other receivables. 2018 $ 2019 $ Financial assets measured at amortised cost Trade & other receivables 1,663,366 1,682,767 note 5c: other current assets Prepayments 1,392,538 1,184,312 1,392,538 1,184,312 Total other current assets NOTE 6: FINANCIAL ASSETS Financial assets at amortised cost Current - Term deposits 9,446,481 9,700,000 Non-current 1,500,000 - Fixed term deposits 1,500,000 10,946,481 11,200,000 Total financial assets at amortised cost Term deposits have stated interest rates of 1.88% to 2.60% (2018: 2.23% to 2.55%) and mature in 120 or 180 days. Fixed term deposits pay quarterly interest coupons equal to the 90-day Bank Bill Swap Rate (BBSW) plus a fixed margin of 0.985%. The fixed term deposit will mature on 8 June 2021. During the year ended 30 June 2019, the association received interest income of $331,747 (2018: $195,333) in respect of financial assets at amortised cost. Impairment of financial assets To assess the impairment on term-deposits and fixed-term deposits, the Association has considered the AA credit rating of these investments. In light if that rating, the loss allowance is measured at an amount equal to 12-month expected credit losses. In determining the expected credit losses for these assets, the Committee of Management have taken into account the historical default experience, the financial position of the counterparties, the future prospects of the industries, financial analyst reports and various external sources of actual and forecast economic information, as appropriate, in estimating the probability of default of each of these financial assets occurring within their respective loss assessment time horizon, as well as expected loss upon default in each case. The Association’s exposure to credit and interest rate risk is disclosed in note. 2018 $ NOTE 7: NON-CURRENT ASSETS 2019 $ note 7a: land and Buildings Land and buildings: fair value 12,173,500 12,173,500 accumulated depreciation (18,237) (322,575) 12,155,263 11,850,925 Total land and buildings Reconciliation of the Opening and Closing Balances of Land & Buildings As at 1 July Gross book value 9,874,600 12,173,500 (457,982) Accumulated depreciation and impairment (18,237) 9,416,618 12,155,263 net book value 1 July Additions: By purchase From acquisition of entities (including restructuring) Revaluations 2,298,900 Impairments Depreciation expense (246,915) (304,338) Other movement: Reversal of accumulated depreciation due to revaluation 686,660 Disposals: From disposal of entities (including restructuring) Other 12,155,263 11,850,925 net book value 30 June net book value as of 30 June represented by: Gross book value 12,173,500 12,173,500 (18,237) Accumulated depreciation and impairment (322,575) 12,155,263 11,850,925 net book value 30 June
The fair The reva Manage and risk Fair valu support /m2 of s value. As at th Sengup accredit have rec A signifi (lower) f note 7B Plant an at cost accum Total pla Reconcil As at 1 J Gross b Accumu net book Addition By purc From a Impairm Depreci Other m Revers Disposa From d Other net book net book Gross b Accumu net book note 7c Property Opening Additio Net ga Closing lease In Opening Additio Less ac Closing Total Inv Propert valuer w of the in The fair Internat their est relied on The high Addition Rental in Direct e $680,62 property Associa property Fair valu valuatio support rate /m market The fair A signifi (lower) f note 7d Prepaym Other Total oth NOTE 8 note 8a Trade cr Operatin Total tra Settlem note 8B Income GST pay Other Total oth Total oth No m More Total oth note 8c The follo - Trad - Oth
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The fair value of land and buildings is included within level 2. The revalued land and buildings consist of commercial properties and carparking spaces held within NSW and the ACT Management determined that these constitute one class of asset under AASB 13, based on the nature, characteristics and risks of the properties. Fair value of the properties was determined by using direct comparison on a rate per square metre of lettable area supported by the capitalisation of net income method. This means that it utilises sales that have been analysed on a rate /m2 of strata area basis and compares the equivalent rates to the subject to establish the property’s current market value. As at the date of revaluation, 30 June 2018, the properties’ fair values are based on valuations performed by Shweta Sengupta of LandMark White (Sydney) Pty Ltd and Timothy Heaton of CBRE Valuation & Advisory Services, who are accredited independent valuers with recognised professional qualifications with the Australian Property Institute and who have recent experience in the location and category of the properties being valued. A significant increase (decrease) in estimated price per square metre in isolation would result in a significantly higher (lower) fair value. note 7B: plant and equipment 2018 $ 2019 $ Plant and equipment: at cost 3,781,482 3,881,635 (2,772,757) accumulated depreciation (2,802,077) 1,008,725 1,079,558 Total plant and equipment Reconciliation of the Opening and Closing Balances of Plant & Equipment As at 1 July Gross book value 3,796,694 3,781,482 (2,798,296) Accumulated depreciation and impairment (2,772,757) 998,398 1,008,725 net book value 1 July Additions: By purchase 591,998 594,700 From acquisition of entities (including restructuring) Impairments Depreciation expense (508,942) (456,331) Other movement: Reversal of accumulated depreciation due to disposal 534,481 427,011 Disposals: From disposal of entities (including restructuring) Other (607,210) (494,547) 1,008,725 net book value 30 June 1,079,558 net book value as of 30 June represented by: Gross book value 3,781,482 3,881,635 (2,772,757) Accumulated depreciation and impairment (2,802,077) 1,008,725 1,079,558 net book value 30 June note 7c: investment property Property Opening balances as at 1 July 27,909,500 27,909,500 Additions Net gain/(loss) from fair value adjustment 27,909,500 Closing balance as at 30 June 27,909,500 lease Incentive Opening balance as at 1 July 4,653,598 4,847,001 Additions 193,402 231,000 (3,489,853) Less accumulated amortisation of lease incentive (4,086,082) 1,357,147 Closing balance as at 30 June 991,919 29,266,647 28,901,419 Total Investment Property Property valuations were performed by Mark Willers of LandMark White (Sydney) Pty Ltd, an accredited independent valuer with a recognised and relevant professional qualification and with recent experience in the location and category of the investment property being valued. The fair value of completed investment property has been determined on a market value basis in accordance with International Valuation Standards (IVS), as set out by the International Valuation Standards Council (IVSC). In arriving at their estimates of market values, the valuers have used their market knowledge and professional judgement and not only relied on historical transactional comparables. The highest and best use of the investment properties is not considered to be different from its current use. Additions during the year relate to improvements on commercial property. This forms part of the lease incentive. Rental income earned and received from the investment properties during the year was $1,690,297 (2018: $1,696,817). Direct expenses incurred in relation to the investment properties that generated rental income during the year was $680,626 (2018: $529,066). During the year and as at the year-end, no restrictions on the realisability of investment property or the remittance of income and proceeds of disposal were present. The Shop, Distributive and Allied Employees’ Association NSW Branch does not have any contractual obligations to purchase, construct or develop investment property or for repairs, maintenance or enhancements. Fair value of investment properties is determined by Mark Willers of LandMark White (Sydney) Pty Ltd using recognised valuation techniques. These techniques include using direct comparison on a rate per square metre of lettable area supported by the capitalisation of net income method. This means that it utilises sales that have been analysed on a rate /m2 of strata area basis and compares the equivalent rates to the subject to establish the property’s current market value. The fair value of the investment property is included within level 2. A significant increase (decrease) in estimated price per square metre in isolation would result in a significantly higher (lower) fair value. note 7d: other non-current assets 2018 $ 2019 $ Prepayments 5,054 5,576 Other 5,054 5,576 Total other non-current assets NOTE 8: CURRENT LIABILITIES note 8a: trade payaBles Trade creditors and accruals 621,348 878,870 Operating lease rentals 621,348 878,870 Total trade payables Settlement is usually made within 30 days. note 8B: other payaBles Income in advance 123,801 GST payable 10,072 1,545 Other 30,045 11,617 153,846 Total other payables Total other payables are expected to be settled in: No more than 12 months 11,617 153,846 More than 12 months 11,617 153,846 Total other payables note 8c: financial liaBilities at amortised cost The following financial liabilities are measured at amortised cost: - Trade payables 621,348 878,870 11,617 - Other payables 153,846 1,032,716 632,965
NOTE 9: EMPLOYEE PROVISIONS note 9a: employee provisions Office Holders: Annual leave Long service leave Separations and redundancies Other Subtotal employee provisions — office holders employees other than office holders: Annual leave Long service leave Separations and redundancies Other Subtotal employee provisions — employees other than office holders Total employee provisions Current Non-current Total employee provisions NOTE 10: EqUITY note 10a: general funds Asset Revaluation Reserve Balance at start of the year: Transfers to reserve Transfers out of reserve Balance as at end of year Total Reserves NOTE 11: CASH FLOW note 11a: cash flow reconciliation Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement: Cash and cash equivalents as per: Cash flow statement Balance sheet Difference Reconciliation of profit/(loss) to net cash from operating activities: Profit/(loss) for the year Adjustment for non-cash items: Depreciation Net write-down of non-financial assets Non-cash income (Gain)/Loss on disposal of assets Changes in assets/liabilities (Increase)/decrease in net receivables (Increase)/decrease in prepayments Increase/(decrease) in supplier payables Increase/(decrease) in other payables Increase/(decrease) in employee provisions Increase/(decrease) in other provisions net cash from (used by) operating activities note 11B: cash flow information Cash inflows from other Reporting Units: Shop, Distributive & Allied Employees’ Association - National Office Shop, Distributive & Allied Employees’ Association – Newcastle & Northern Branch Total cash inflows for the year Cash outflows from other Reporting Units: Shop, Distributive & Allied Employees’ Association – National Office Shop, Distributive & Allied Employees’ Association – Newcastle & Northern Branch Shop, Distributive & Allied Employees’ Association – Northern Territory Branch Shop, Distributive & Allied Employees’ Association – Queensland Branch Shop, Distributive & Allied Employees’ Association – South Australian Branch Shop, Distributive & Allied Employees’ Association – Victorian Branch Shop, Distributive & Allied Employees’ Association – Western Australian Branch
2019 $
2018 $
64,162 134,511 198,673
80,151 126,302 206,453
791,513 1,548,931 2,340,444 2,539,117 2,520,063 19,054 2,539,117
762,594 1,508,885 2,271,479 2,477,932 2,458,670 19,262 2,477,932
20,420,153 20,420,153 20,420,153
17,434,594 2,985,559 20,420,153 20,420,153
2,179,997 2,179,997 -
1,434,563 1,434,563 -
(233,392)
640,848
760,669 (76,970) (90,901)
755,857 (44,523) (155,905)
(35,028) 207,704 399,752 61,185 993,019
(483,834) (10,375) 83,550 8,134 27,569 821,321
20,139 16,022 36,161 21,652,984
18,960 11,748 30,708 20,581,087
2,126,761 240,509 1,918 3,434 10,285 5,082 11,307 2,399,296 20,907,550
2,094,161 303,018 1,578 11,960 13,250 5,539 12,305 2,441,811 21,444,110
Total cash outflows for the year NOTE 12: CONTINgENT LIABILITIES, ASSETS AND COMMITMENTS note 12a: commitments and contingencies Operating lease commitments—as lessee The operating leases (property, plant and equipment) are non-cancellable with terms of three to six years. Operating leases are paid monthly or quarterly in advance. The leases provide a right of renewal at which time all terms are renegotiated. Future minimum rentals payable under non-cancellable operating leases as at 30 June are as follows: Within one year 362,082 320,688 After one year but not more than five years 591,642 373,059 More than five years 953,724 693,747 Operating lease commitments—as lessor The association leases out its investment properties under operating leases (see note 7C). The future minimum lease income under non-cancellable leases are as follows: Future minimum rentals receivable under non-cancellable operating leases as at 30 June are as follows: Within one year 1,277,754 1,249,263 After one year but not more than five years 2,041,184 526,921 More than five years 3,318,938 1,776,184 During the year, $1,101,814 was recognised as rental income in profit or loss (2018: $1,227,379) Capital commitments The Association does not have any future capital commitments. Other contingent assets or liabilities (i.e. legal claims) The Association is not aware of any contingent asset or liability.
263
500 7) 263
SDA NEWS f spring 2019 f PAGE 37
NOTE 13: RELATED PARTY DISCLOSURES note 13a: related party transactions for the reporting period The following table provides the total amount of transactions that have been entered into with related parties for the relevant year: 2018 $ Revenue received from Shop, Distributive & Allied employees’ Association 2019 $ national Office includes the following: Reimbursements - Other 18,538 20,139 expenses paid to Shop, Distributive & Allied employees’ Association national Office includes the following: Affiliation fees 1,451,577 1,475,940 Campaign levies 426,900 155,593 Other 56,637 209,790 expenses paid to Shop, Distributive & Allied employees’ Association national Office – International Fund includes the following: Affiliation Fees – International Fund 217,737 221,391 expenses paid to Australian labor Party nSW includes the following: Affiliation fees 259,841 267,409 Donations – Campaign lunches / dinners 727 25,450 Donations – Other 900 expenses paid to the Australian labor Party ACT includes the following: Affiliation fees 7,767 7,959 Donations – campaign levy 3,500 expenses paid to the labor Council nSW includes the following: Affiliation fees 201,894 206,140 expenses paid to the Australian labor Council ACT includes the following: Affiliation fees 1,724 4,000 expenses paid to the labor Council South Coast includes the following: Affiliation fees 3,507 3,044 The sales to and purchases from related parties are made on terms equivalent to those that prevail in arm’s length transactions. Outstanding balances for sales and purchases at the year-end are unsecured and interest free and settlement occurs in cash. There have been no guarantees provided or received for any related party receivables or payables. For the year ended 30 June 2019, the Shop Distributive and Allied Employees’ Association NSW Branch has not recorded any impairment of receivables relating to amounts owed by related parties and declared person or body (2018: $Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates. note 13B: Key management personnel remuneration for the reporting period Short-term employee benefits Salary (including annual leave taken) 326,012 327,536 Annual leave accrued 5,602 Performance bonus 30,922 Non-Monetary (motor vehicle & parking) 29,567 362,536 357,103 Total short-term employee benefits Post-employment benefits: 64,023 Superannuation 63,141 64,023 63,141 Total post-employment benefits Other long-term benefits: 4,725 Long-service leave 8,220 4,725 8,220 Total other long-term benefits Termination benefits 431,284 428,464 Total Key Management Personnel Bernie Smith Robert Tonkli Narelle Corrine Boyle Total Secretary Assistant Atkins Information Secretary Organiser Officer ReMUneRATIOn FOR 2019 $ $ $ $ $ Short-term employee benefits Salary (including annual leave taken) 133,236 124,212 44,860 25,228 327,536 Honorarium Annual leave accrued 13,582 15,986 29,568 Non-monetary (motor vehicle & parking) 146,818 140,198 44,860 25,228 357,104 Total short-term employee benefits Post-employment benefits: 27,446 23,027 7,465 5,202 63,140 Superannuation 27,446 23,027 7,465 5,202 63,140 Total post-employment benefits Other long-term benefits: 3,463 3,475 1,282 8,220 Long-service leave 3,463 3,475 1,282 8,220 Total other long-term benefits 177,727 166,700 53,607 30,430 428,464 Total ReMUneRATIOn FOR 2018 Short-term employee benefits Salary (including annual leave taken) 128,025 111,193 41,249 45,545 326,012 Honorarium Annual leave accrued 941 4,514 147 5,602 14,579 16,343 Non-monetary (motor vehicle & parking) 30,922 143,545 132,050 41,396 45,545 362,536 Total short-term employee benefits Post-employment benefits: 27,581 20,947 6,819 8,676 Superannuation 64,023 27,581 20,947 6,819 8,676 64,023 Total post-employment benefits Other long-term benefits: 3,594 1,130 Long-service leave 4,724 3,594 1,130 4,724 Total other long-term benefits 171,126 156,591 49,345 54,221 431,283 Total 2018 $ NOTE 14: REMUNERATION OF AUDITOR 2019 $ Value of the services provided Financial statement audit services 52,800 50,996 Other services 52,800 50,996 Total remuneration of auditors No other services were provided by the auditors of the financial statements. NOTE 15: FINANCIAL RISk MANAgEMENT The Shop, Distributive and Allied Employees’ NSW Branch’s financial instruments consist mainly of deposits with banks, short- and medium-term deposits with financial institutions, accounts receivables and accounts payables. The totals for each category of financial instrument measured in accordance with AASB 9: Financial Instruments as detailed in the accounting policies to these financial statements, are as follows: Note 2018 $ 2019 $ Financial Assets Financial assets at amortised cost - Cash & cash equivalents 5A 1,434,563 2,179,997 - Trade & other receivables 5B 1,663,366 1,682,767 - Term deposits 6 9,446,481 9,700,000 - Fixed term deposits 6 1,500,000 1,500,000 14,044,410 15,062,764 Financial liabilities Financial assets at amortised cost 632,965 - Trade and other payables 8C 1,032,716 632,965 1,032,716
PAGE 38 f spring 2019 f SDA NEWS
Financial risk management policies The Committee of Management has overall responsibility for the establishment and oversight of risk management policies. Main policies aim to minimise potential risk exposure by actively securing short to medium term cash flows through minimising exposure to financial markets. The Association currently does not hold any long-term financial instruments. The Association does not actively engage in the trading of financial assets for speculative purposes. Specific Financial Risk exposures and Management The main risks the Association is exposed to through its financial statements are credit risk, liquidity risk and interest rate risk. There have been no substantive changes in the types of risks the Association is exposed to, how these risks arise, or the Committee of Management’s objectives, policies and processes for managing or measuring the risks from the previous period. Credit risk Exposure to credit risk relating to financial assets arises from the potential non-performance by counterparties of contract obligations that could lead to a financial loss to the Association. The Association’s objective in managing credit risk is to minimise the credit loss incurred, mainly on trade and other receivables. There is no significant risk exposure on other financial assets at amortised cost. Credit risk is managed through maintenance of procedures, ensuring to the extent possible that customers and counter parties to transactions are of sound credit worthiness. Such monitoring is used in assessing receivables for impairment. Credit terms are usually Cash on Delivery or 30 Days from date of invoice. Risk is also minimised through investing surplus funds with financial institutions that maintain high credit rating, or in entities that the Association has assessed as being financially sound. Credit Risk Exposures The maximum exposure to credit risk by class of recognised financial assets at balance date is equivalent to the carrying value and classification of those financial assets (net of any provisions) as presented in the statement of financial position. Trade and other receivables that are not past due or impaired are considered to be of high credit quality. Aggregates of such amounts are as detailed in Note 5B. The Association does not have any material credit risk exposure to any single receivable or group of receivables under financial instruments entered into by the Association. Credit risk related to balances with banks and other financial institutions is managed by the Finance Committee in accordance with approved Committee policy. Such policy requires that surplus funds are only invested with counter parties with a Standard and Poor’s (S&P) rating of at least AA-. The following table provides information regarding the credit risk relating to cash and money market securities based on S&P Counterparty Credit Ratings 2018 $ note 2019 $ Cash and cash equivalents - AA Rated 1,434,563 Short-term & fixed term deposits 5A 2,179,997 10,946,481 - AA Rated 11,200,000 6 12,381,044 13,379,997 liquidity Risk Liquidity risk arises from the possibility that the Association might encounter difficulty in settling its debts or otherwise meeting its obligations related to financial liabilities. The Association is not exposed to any significant liquidity risk on the basis that the realisable value of financial assets is significantly greater than the financial liabilities due for settlement. The Association manages its liquidity risk through the following mechanisms: − preparing forward looking cash flow analysis in relation to its operational, investing and financing activities; − maintaining a reputable credit profile; − managing credit risk related to financial assets; − comparing the maturity profile of financial liabilities with the realisation profile of financial assets; and − only investing surplus cash with major financial institutions. The table below reflects an undiscounted contractual maturity analysis for non-derivative financial liabilities. The association does not hold any derivative financial liabilities directly. Cash flows realised from financial assets reflect management’s expectation as to the timing of realisation. Actual timing may therefore differ from that disclosed. The timing of cash flows to settle financial liabilities is presented in the table below. Financial liability and financial asset maturity analysis: Within 1 Year 1 to 2 Years Over 2 Years Total 2018 $ 2018 $ 2018 $ 2018 $ 2019 $ 2019 $ 2019 $ 2019 $ Financial liabilities – due for payment Trade payables 878,870 621,348 878,870 621,348 Other payable 153,846 11,617 153,846 11,617 Total expected 1,032,716 632,965 1,032,716 632,965 outflows Financial Assets – Cash flows realisable Cash & cash equivalents 2,179,997 1,434,563 2,179,997 1,434,563 Trade & other receivables 1,682,767 1,663,366 1,682,767 1,663,366 Term deposits 9,700,000 9,446,481 9,700,000 9,446,481 1,500,000 1,500,000 1,500,000 1,500,000 Fixed term deposits Total expected 13,562,764 12,544,410 1,500,000 1,500,000 15,062,764 14,044,410 outflows net (outflow)/inflow expected on financial 12,530,048 11,911,445 1,500,000 1,500,000 14,030,048 13,411,445 instruments Market Risk Interest rate risk Exposure to interest rate risk arises on financial assets and financial liabilities recognised at the end of the reporting period whereby future changes in interest rates will affect future cash flows or the fair value of fixed rate financial instruments. The Association is also exposed to earnings volatility on floating rate instruments. The financial instruments that expose the Association to interest rate risk are limited to cash on deposit, term deposits and fixed term deposits. The Association manages interest rate risk by varying the maturity period and principal sums invested of term deposits to ensure the entity receives the most advantageous interest rate on offer. The Association also manages interest rate risk by ensuring that, whenever possible, payables are paid within any pre-agreed credit terms. Other market risks The Association is not exposed to any other market risks such as price or foreign currency risk. Sensitivity analysis The following table illustrates sensitivities to the Association’s exposures to changes in interest rates. The table indicates the impact of how profit and equity values reported at the end of the reporting period would have been affected by changes in the relevant risk variable that management considers to be reasonably possible. These sensitivities assume that the movement in a particular variable is independent of other variables. Profit and loss $ Equity $ Year ended 30 June 2019 +/- 1% in interest rates +/- 133,783 +/- 133,783 Year ended 30 June 2018 +/- 1% in interest rates +/- 110,092 +/- 110,092 There have been no changes in any of the assumptions used to prepare the above sensitivity analysis from the prior year. Capital Management In conjunction with the above risk policies, specifically those relating to financial instruments, the Association’s policy is to maintain a strong capital base so as to sustain member, creditor and market confidence and to sustain future development of the unions activities. The Committee of Management monitors the return on capital and seeks to maintain a conservative position. There were no changes in the Association’s approach to capital management during the year.
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NOTE 16: FAIR VALUE MEASUREMENT note 16A: Financial Assets and liabilities The fair values of financial assets and financial liabilities are presented in the following table and can be compared to their carrying amounts as present in the statement of financial position. Refer to note 16B for detailed disclosures regarding the fair value measurement of the Association’s financial assets and financial liabilities. Carrying amount Net Fair value Carrying amount Net Fair value 2019 2018 2019 2018 $ $ $ $ Financial Assets At amortised cost - Cash & cash equivalents 2,179,997 1,434,563 2,179,997 1,434,563 - Trade and other receivables 1,682,767 1,663,366 1,682,767 1,663,366 - Term deposits 9,700,000 9,446,481 9,700,000 9,446,481 - Fixed term deposits 1,500,000 1,500,000 1,500,000 1,500,000 15,062,764 14,044,410 15,062,764 14,044,410 Financial liabilities At amortised cost 1,032,716 632,965 - Trade & other payables 1,032,716 632,965 1,032,716 632,965 1,032,716 632,965 Cash and cash equivalents, trade and other receivables, trade and other payables, and term deposits are short-term instruments whose carrying amounts approximate their fair values. Trade and other payables excludes amounts relating to the provision of annual leave, which are outside the scope of AASB 9. note 16B: financial and non-financial assets and liaBilities fair value hierarchy The Shop, Distributive and Allied Employees’ Association NSW Branch measures and recognises the following assets and liabilities at fair value on a recurring basis after initial recognition: - Free hold land and buildings - Investment properties The Association does not subsequently measure any liabilities at fair value on a recurring basis, or any assets or liabilities at fair value on a non-recurring basis. Fair Value Hierarchy AASB 13: Fair Value Measurement requires the disclosure of the fair values information by level of the fair value hierarchy, which categorises fair value measurements into one of three possible levels based on the lowest level that an input that is significant to the measurement can be categorised into as follows: level 1 level 2 level 3 Measurements based on quoted Measurements based on inputs Measurements based on market prices (unadjusted) in active other than quoted prices included unobservable inputs for the markets for identical assets or in level 1 that are observable for asset or liability. liabilities that the entity can the asset or liability, either access at the measurement date. directly or indirectly. The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation techniques. These valuation techniques maximise, to the extent possible, the use of observable market data. If all significant inputs required to measure fair value are observable, the asset or liability is included in Level 2. If one or more significant inputs are not based on observable market data, the asset or liability is included in Level 3. Valuation Techniques The Association selects a valuation technique that is appropriate in the circumstances and for which sufficient data is available to measure fair value. The availability of sufficient and relevant data primarily depends on the specific characteristics of the asset or liability being measured. The valuation techniques selected by the Association are consistent with one or more of the following valuation approaches: − Market approach using prices and other relevant information generated by market transactions for identical or similar assets or liabilities. − Income approach converts estimated future cash flows or income and expenses into a single discounted present value. − Cost approach reflects the current replacement cost of an asset at its current service capacity. Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing the asset or liability, including assumptions about risks. When selecting a valuation technique, the Association gives priority to those techniques that maximise the use of observable inputs and minimise the use of unobservable inputs. Inputs that are developed using market data (such as publicly available information or actual transactions) and reflect the assumptions that buyers and sellers would generally use when pricing assets or liabilities are considered observable, whereas inputs for which market data is not available and therefore are developed using the best information available about such assumptions are considered unobservable. The following tables provide the fair values of the Association’s assets and liabilities measured and recognised on a recurring basis after initial recognition and their categorisation within the fair value hierarchy: Date of valuation Level 1 Level 2 Level 3 2019 $ $ $ Assets measured at fair value Non-Financial Assets: Land & Buildings 30 June 2018 12,155,263 27,909,500 Investment Property 30 June 2017 40,064,763 Total
NOTE 17: SECTION 272 FAIR WORk (REgISTERED ORgANISATIONS) ACT 2009 In accordance with the requirements of the Fair Work (Registered Organisations) Act 2009, the attention of members is drawn to the provisions of subsections (1) to (3) of section 272, which reads as follows: Information to be provided to members or Commissioner: 1) A member of a reporting unit, or the Commissioner, may apply to the reporting unit for specified prescribed information in relation to the reporting unit to be made available to the person making the application. 2) The application must be in writing and must specify the period within which, and the manner in which, the information is to be made available. The period must not be less than 14 days after the application is given to the reporting unit. 3) A reporting unit must comply with an application made under subsection (1). NOTE 18: OFFICERS DECLARATION STATEMENT I, Bernard Smith, being the Branch Secretary of the Shop, Distributive and Allied Employees’ Association NSW Branch, declare that the following activities did not occur during the reporting period ending 30 June 2019. The reporting unit did not: • acquire an asset or liability due to an amalgamation under Part 2 of Chapter 3 of the RO Act, a restructure of the branches of an organisation, a determination or revocation by the General Manager, Fair Work Commission • receive capitation fees or any other revenue amount from another reporting unit • receive revenue via compulsory levies • receive donations or grants • receive revenue from undertaking recovery of wages activity • pay capitation fees or any other expense to another reporting unit • pay a penalty imposed under the RO Act or the Fair Work Act 2009 • have a receivable with other reporting unit(s) • have a payable with other reporting unit(s) • have a payable to an employer for that employer making payroll deductions of membership subscriptions • have a payable in respect of legal costs relating to litigation • have a payable in respect of legal costs relating to other legal matters • have a fund or account for compulsory levies, voluntary contributions or required by the rules of the organisation or branch • have another entity administer the financial affairs of the reporting unit • make a payment to a former related party of the reporting unit Signed by the officer: Bernie Smith, Secretary-Treasurer Dated: 20 August 2019
Date of valuation Level 1 Level 2 Level 3 2018 $ $ $ Assets measured at fair value Non-Financial Assets: Land & Buildings 30 June 2018 12,155,263 27,909,500 Investment Property 30 June 2017 40,064,763 Total There were no transfers between level 1 and level 2 for assets measured at fair value on a recurring basis during the reporting period (2018: no transfers). In 2019 the fair value of investment property was $27,909,500 and carrying amount of lease incentive was $991,919 giving a total of $28,901,419 (2018: fair value of investment property was $27,909,500 and carrying amount of lease incentive was $1,357,147 giving a total of $29,266,647). Valuation Techniques and Inputs Used to Measure level 2 Fair Values Description Valuation Technique(s) Inputs Used Non-financial assets: Land and Buildings Market approach using recent Price per square metre; observable market data for similar Market borrowing rate properties; income approach using discounted cash flow methodology Investment property Market approach using recent Price per square metre; observable market data for similar Market borrowing rate properties; income approach using discounted cash flow methodology The fair value of land and buildings and investment properties is determined at least every three years based on valuations by an independent valuer. At the end of each intervening period, the Committee of Management review the independent valuation(s) and when appropriate, update the fair value measurement to reflect current market conditions using a range of valuation techniques, including recent observable market data and discounted cash flow methodologies. There were no changes during the period in the valuation techniques used by the Association to determine Level 2 fair values.
maintain ear.
SDA NEWS f spring 2019 f PAGE 39
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