Te Pūrongo - TWoA Annual Report 2018 by Te Wananga o Aotearoa

Annual Report 2018

Te Wānanga o Aotearoa

TŌ TĀTOU HAERENGA Our journey

For more than 30 years, Te Wānanga o Aotearoa has been the waka that has safely guided our tauira on a journey through uncharted waters. They and their whānau have flourished throughout that journey, as they have been nurtured and provided the skills to navigate their way to the future they deserve. Throughout any journey, challenges await. But using the knowledge handed down to us, our waka has withstood the storms and continues to keep to its course to a brighter future.

Annual Report 2018

KARAKIA Haunui

Hau nui, hau roa, Hau wāwahi waka Hau pupuhi pūpūtara ki uta Hau titipārera, tipitipia mai A runga o Whakaari ki te wai Haehaea mai ngākākahu o tō tupuna e-e.

Te Wānanga o Aotearoa

CONTENTS

Te Pūrongo 2018

Ngā Uara Our Values

Arotakenga In review

Tā Te Heamana Chairperson’s Report

Te Mana Whakahaere Council

Tā Te Taiurungi Chief Executive’s Report

Ngā Tumu Leadership Team

Ahurea Advancing Mātauranga Māori

He Tauira Student Profile

Hapori Social wellbeing for all New Zealanders

He Tauira Student Profile

Arumoni Economic wellbeing for all New Zealanders

He Tauira Student Profile

Ngā ki Taurangi Statement of Service Performance

Te Tahua Financial Report

Te Wānanga o Aotearoa

NGĀ UARA Our Values

Annual Report 2018

NgÄ Ture The knowledge that our actions are morally and ethically right and that we are acting in an honourable manner.

Te Whakapono The basis of our beliefs and the confidence that what we are doing is right.

Te Aroha Having regard for one another and those for whom we are responsible and to whom we are accountable to.

Te Kotahitanga Unity amongst iwi and other ethnicities; standing as one.

Te Wānanga o Aotearoa

NGĀ MATAWHĀNUI Our Vision

He takapau mātauranga, he whānau huarewa Whānau transformation through education

Te Pūrongo 2018

NGĀ WHAKATAKANGA Our Mission

Kia angitu te tauira Tauira success

Te Wānanga o Aotearoa

AROTAKENGA In Review

Of our 30,613 tauira in 2018

51%

12%

44%

were Māori

were Asian

were Pākeha

were Pasifika

53%

were Other

were over 40 years old

34% had no tertiary qualifications 23% had no secondary school qualifications

71%

were Female

29% were Male

Annual Report 2018

9336 tauira learning te reo Māori across the country

Te Wānanga o Aotearoa provides

67%

of all te reo Māori provision in Aotearoa

The audience for Taringa, a weekly podcast about all things te ao Māori, continued to grow with more than 180,000 listens from people in more than 50 countries.

participants took part in Mahuru Māori, taking up the challenge

Te Wānanga o Aotearoa

TĀ TE HEAMANA Chairperson's report

It is my pleasure to present the Annual Report for 2018, a year where we took time to refocus and re-prioritise in order to face the challenges ahead.

I want to begin my report by acknowledging the passing in November of former Te Mana Whakahaere member and chairman Richard Batley. Richard joined Te Mana Whakahaere in 2005 and was elected chair in 2008, a role he held until he retired in 2016. Te Wānanga o Aotearoa made immense progress under Richard’s leadership, and with his background in accountancy, he drove a strong financial turnaround for the organisation and a return to surpluses. He was a passionate advocate for the development of Māori and the success of Te Wānanga o Aotearoa. Richard and his legacy will be remembered. Moe mai rā e te rangatira. In early 2018, Dr Jim Mather announced that he would not seek re-appointment for a further five years as chief executive to focus on his young whānau. We wish him every success in whatever he puts his hand to in the years ahead and I want to acknowledge his efforts in his time with Te Wānanga o Aotearoa. Dr Mather’s resignation launched a thorough recruitment process to find the best individual to lead the next phase of our organisational

development. Following an extensive process, Te Ururoa Flavell - who brings a strong background in Māori education and Māori development and is a leader in Māori language revitalisation - was welcomed to the role of chief executive in August.

structures and consistency around our self-assessment and our ability to act in a timely manner to resolve these issues when they arose.

Te Ururoa was selected for the role because of his reputation for hard work and a hands-on approach to leading from the front. Those skills were put in use immediately, leading the restructure of our organisation following the announcement of an External Evaluation and Review (EER) downgrade in October, and a pending financial deficit for the first time in more than a decade.

The report also recognised that the vast majority of what we do at Te Wānanga o Aotearoa is of a very high standard and provides immense value and benefit to the many communities we serve throughout Aotearoa. Our tauira told NZQA their studies at Te Wānanga o Aotearoa were transformational and mana-enhancing and the report noted graduates have increased their understanding of mātauranga Māori and are using their knowledge and skills in their communities.

The EER result saw Te Wānanga o Aotearoa receive a Pounamu Hukihuki rating – the equivalent of a category 3 designation – for our 2017 EER report, down from category 1. This was the result of problems with the consistency of our assessments for a small number of our programmes.

Achieving consistent quality in assessment practice for some of our programmes has been an ongoing issue for some years and the downgrade was the catalyst for a major realignment and restructure of the head-office of our organisation, which had a two-tiered focus.

While the scale of the problem was small relative to the scale of our organisation and our programme offerings, NZQA highlighted problems with our academic

Te Ururoa - supported by Te Mana Whakahaere and his senior leadership team - was given clear direction to resolve these moderation issues and rebuild the organisation’s

Te PĹŤrongo 2018

Vanessa Eparaima MNZM Heamana | Chairperson

Te Wānanga o Aotearoa

"Our tauira are the focus of all that we do, and we are making firm and considered progress to ensure we are providing the best offerings and services to strengthen the employment and learning opportunities to the many communities we serve across Aotearoa"

academic development team to be more connected and responsive to the educational needs of our takiwā, whānau, communities and industry. This included reprioritising quality assurance, staff training and development throughout Te Wānanga o Aotearoa to improve educational delivery and instil greater confidence in programmes and qualifications. These actions dominated the latter part of 2018 and will continue as a key priority in 2019. While financial deficits have become the reality for the vast majority in the tertiary sector - with most polytechnics and tertiary institutes struggling financially due to declining enrolments and government funding caps - another key driver for the restructure was to improve academic outcomes while ensuring the organisation’s financial sustainability. This remains a key focus as we continue to evolve and work towards our mission of tauira success in 2019 and beyond. While 2018 was

a challenging year, I am confident that changes underway – and those already engaged – will ensure Te Wānanga o Aotearoa continues to deliver and play the essential role it has in lifting employment and educational outcomes and te reo Māori revitalisation - guided by Māori principles and values - to communities across Aotearoa. In 2018, we farewelled Ministerial appointment to Te Mana Whakahaere, Dr Kathie Irwin, who resigned to take up a new employment opportunity, and I thank her for the positive contribution she made over more than three years. We expect to welcome a replacement for Dr Irwin in 2019. I want to acknowledge the hard work and dedication of Te Mana Whakahaere during 2018 and for the continued and collegial work we all put in to drive the strategy and direction of Te Wānanga o Aotearoa.

passion for their mahi and the organisation in the past year as we have gone through a period of transition and change. Our kaimahi are the key asset in the important mahi we do supporting the educational and training needs of tens of thousands of tauira who commit to enhancing their employment opportunities and qualifications through the classrooms and marae of Te Wānanga o Aotearoa each year. Finally, I want to acknowledge those more than 30,000 tauira who each year continue to support Te Wānanga o Aotearoa by studying with us. Your success is our success and the graduation ceremonies we hold throughout the country are testament to the hard work, passion and commitment our tauira put in to their education.

I also want to acknowledge the kaimahi of Te Wānanga o Aotearoa who have showed resilience and Vanessa Eparaima MNZM Heamana | Chairperson

Annual Report 2018

Te Wānanga o Aotearoa

TE MANA WHAKAHAERE Council

Vanessa Eparaima MNZM Heamana | Chairperson Ngāti Raukawa, Ngāti Tūwharetoa

Katie Bhreatnach Mema | Member LLB (Hons), BA (Hons), LLM Ngāti Mahuta, Ngāti Awa

Bryan Hemi Heamana Tuarua | Deputy Chair MBA, BE Ngāti Kahungunu, Ngāti Koata, Samoan

Hon. Te Ururoa Flavell Mema | Member MA, DipTchg Ngāti Rangiwewehi, Ngāraranui, Ngāti Raukawa, Ngāti Te Ata, Ngāpuhi

Te Pūrongo 2018

Robert Gabel Mema | Member BA, BCom, CA Ngāti Kahu, Te Rarawa, Te Paatu

Steve Ruru Mema Whakatūria Ministerial Appointment BMS, CA Ngāti Raukawa, Ngāti Ranginui

Jon Stokes Mema Whakatūria Ministerial Appointment DipJour Ngāti Raukawa, Ngāti Maniapoto

Josh Wharehinga Mema | Member BSocSci, GradDipSupv, DipAdtEd Ngāti Porou, Rongowhakaata, Te Aitanga ā Māhaki, Te Arawa

Te Wānanga o Aotearoa

TĀ TE TAIURUNGI Chief Executive's report

It gives me great pride to present Te Pūrongo 2018, the Annual Report of Te Wānanga o Aotearoa and the first since I took up the role of Te Taiurungi in August.

Kia ū te Wānanga, tāngaengae! Kia ora te Wānanga, tāngaengae! Kia hua te Wānanga, tāngaengae! Kia angitu te tauira, tāngaengae Kia huarewa te whānau, tāngaengae! Tūturu ōwhiti whakamaua kia tīna! Haumi e, hui e, taiki e! E ngā iwi, tēnā koutou. Tēnā koutou i runga i ngā tauwhirotanga a te Wāhi Ngaro, tēnei ka hirihiri te kupu tapu ki te kāhui o ngā atua. Whakamānawatia a Kīngi Tuheitia, te mauri o te motu, e noho nei i te ahurewa tapu o ōna mātua tūpuna, me tōna whaea. Paimārire. Koutou kei te rau o tītapu, koutou kua riro i te ringa kaha nui o Aituā kikini, e kikini nei te ngākau o te hunga ka mahue mai ki muri, me pehea rā? Me pēhea rā? Haere, okioki atu, ki ngā pae tuangahuru o Kahukura, ki te mūnga o te tini, o te mano, whakangaro atu rā. Kia hoki mai anō ki a tātou ngā kanohi ora o rātau mā, e pīkau nei i ngā kaupapa hei oranga mō te katoa, tēnā tātau katoa.

E te iwi, kei te waimarie katoa ahau ki te noho i tēnei tūranga, kua nōhia e ngā rangatira o mua, nā rātau nei te waka i hautū, i arataki, i tohutohu. Kei te waimarie hoki ki te whakarewa i Te Pūrongo i tēnei tau. Nōku ka tīmata, ka rongo ahau i te wairua i taku pōhiritanga, ka mutu, nā taku pōkai i te nuku o te whenua, ka rangona, ka kitea, te whānui me te whāroa o Te Wānanga o Aotearoa, me ngā āhuatanga o tā tēnā whare, o tā tēnā takiwā manaaki i tā tātau kaupapa. Tēnā hoki koutou e ngā iwi, o aua takiwā, i puta mai ai ki te whakakanohi i tā koutou tautoko i Te Wānanga o Aotearoa, me kore ake koutou kei aku rangatira. Ko ahau tēnei ka whakapau i ōku kaha ki te manaaki i te kaupapa, me te whakatairanga i Te Wānanga o Aotearoa kia noho ai i te taumata e tika ana, hei oranga mō te tauira, hei oranga mō te whānau – mā konā e huarewa ai ko tātau katoa. I tua atu, ahakoa ngā taupā, me ngā wero kei mua i te aroaro, mehemea ka ū te titiro ki te whāinga matua, ā, ka ū anō tātau ki te uho o Te Wānanga o Aotearoa arā ko tō tātau reo, me ā tātau tikanga, ahakoa he aha, ka eke te kaupapa.

Annual Report 2018

Hon. Te Ururoa Flavell Te Taiurungi | Chief Exectuive

Te Wānanga o Aotearoa

"Te Wānanga o Aotearoa has faced challenges before and while this is the case as we move into 2019, they are not insurmountable. In fact, they provide us with the opportunity to reset our direction and operations. We intend to take this opportunity with both hands"

I firstly acknowledge the work of my predecessor Dr Jim Mather, who spent the previous five years leading Te Wānanga o Aotearoa through some significant changes including the establishment of our long-term strategic plan Te Pae Tawhiti 2027, the Te Raumairanga redesign and the successful launch of our new brand. I thank him for his contribution and wish him well. I wish to also acknowledge the contribution of Nepia Winiata – Te Kōmaru (deputy chief executive) for taking a major leadership role during 2018 in the transition period. His efforts to steady the waka and keep things moving were significant under the circumstances. Ka nui aku mihi ki a ia. Following the welcoming pōwhiri I received at Te Puna Mātauranga, I have been busy getting to know as much as I can about this amazing organisation, visiting as many of our sites around Aotearoa as possible and meeting kaimahi throughout the country. In that short time, I have been humbled, surprised, impressed and excited by what I have learned. We have celebrated our successes at the Ngā Tohu Reo Māori - National Māori Language Awards, where Te Wānanga o Aotearoa was recognised in both the Mātauranga Kaupapa Māori – Education Māori Medium, and the Mātauranga Whānui – Education Open sections. It continues our success at

the awards in 2017 and reinforces our commitment to be recognised as a leader in te reo Māori revitalisation, in line with the objectives of Te Pae Tawhiti 2027. I was fortunate to be present at the opening of a stunning new site in Ōtautahi (Christchurch). Like other sites around the country, I believe we can generally be proud of how we present ourselves to the communities we serve. We acknowledged our high-achieving kaimahi at our annual Tau Ora Awards and were honoured to host graduation ceremonies up and down the country for thousands of proud tauira. Our graduation ceremonies provide the perfect place to see the impact Te Wānanga o Aotearoa has on tauira and their whānau, with waiata and haka acknowledging those who personify our mission of “kia angitu te tauira” Tauira Success. Prior to my arrival, we also launched the Pakihi programme – providing free business workshops and mentoring programmes for Māori businesses. I have been continually amazed at the passion our kaimahi bring to their work and the commitment they have for the organisation and our tauira. I have seen it first hand, I have heard about it from the tauira and from big and small communities. That passion, dedication and commitment is important because those are the distinctive attributes that Te Wānanga o Aotearoa was built on

and what has sustained it over difficult periods in the past. I arrived at a time when Te Wānanga o Aotearoa faced some serious challenges. A significant redesign of head office and takiwā leadership was undertaken in the last quarter of 2018 to support our long-term sustainability. These exercises are not easy but it is imperative that we manage our organisation sustainably and responsibly for the future. Significantly, the External Evaluation and Review outcome that saw Te Wānanga o Aotearoa downgraded to a category 3 institution has galvanised everyone within the organisation to do whatever is necessary to return to category 1 as quickly as possible. Work is well underway to address the shortcomings identified by the External Evaluation and Review process. A consequence of this change in category, however, has been to limit our ability to expand and respond to community needs, which is why there is some urgency in our actions. There is a collective belief that we will turn things around. Te Pae Tata – our short-term priorities - have been redefined into three focus areas for 2019-2022 including: Quality and Integrity; Sustainability; and What does it mean to be a wānanga? Our focus on quality and integrity through our Quality Improvement Action Plan is already addressing

Te Pūrongo 2018

issues in areas such as enrolment, kaiako capability, moderation, curriculum design, programme development and approval. We are seeing improvements in these areas and I expect that to continue.

We established a team to pilot a blended learning project (Akorau) using the online learning platform iQualify

Defining what it is to be a wānanga allows us to reflect on what we do and why we do it. Importantly, it will ensure that what we do is consistent with the legislation that led to wānanga from their inception, it will guide the programme suite we offer, and how we engage with each other as kaimahi, tauira and kaiako. We need to show what differentiates Te Wānanga o Aotearoa from other tertiary education providers where there is competition for tauira. Where programmes are offered and how they are delivered may well be the difference of whether tauira come our way or not. We will not deviate from our vision statement of “He takapau mātauranga, he whānau huarewa” whānau transformation through education. Meeting our enrolment targets remains a significant challenge in several programme areas. To address this, work will be undertaken next year to review our mix of provision to ensure that our programmes remain relevant to communities and industry. Ongoing improvements to our tauira enrolment system will also be a major kaupapa for the organisation. As costs continue to rise, we must remain vigilant and ensure our operations are fit-for-purpose and we

use technology – both current and emerging – in the most effective ways possible. To further enhance the sustainability of Te Wānanga o Aotearoa, we are constantly reviewing the range and quality of programmes being offered along with how those programmes are being delivered. We must keep up with new trends and developments. We established a team to pilot a blended learning project (Akorau) using the online learning platform iQualify. This will provide all tauira workbooks and pre-recorded materials online. While initially focussed on the popular Te Ara Reo Māori Level Two course it is likely to be expanded in the coming years. I acknowledge all of our kaimahi and thank them for their ongoing support. To Te Mana Whakahaere and Ngā Tumu, your support has been invaluable and I look forward to working with you and making further progress in the next 12 months to ensure Te Wānanga o Aotearoa continues to play a key role in the lives of our people.

Hon. Te Ururoa Flavell Te Taiurungi | Chief Executive

Te Wānanga o Aotearoa

NGĀ TUMU Leadership Team

Hon. Te Ururoa Flavell Te Taiurungi | Chief Executive MA, DipTchg Ngāti Rangiwēwehi, Ngāraranui, Ngāti Raukawa, Ngāti Te Ata, Ngāpuhi

Lindsay Baxter Tumutaumatua Executive Director Performance & Quality Assurance DipCPM, BIT, PMP, MEd (Dist)

Nepia Winiata Te Kōmaru | Deputy Chief Executive GradDipBA, MALP(Dist) Ngāti Raukawa

Tracey Hook Tumutahua Executive Director Finance & Property BBS, CA Te Āti Haunui a Pāpārangi, Ngā Wairiki Ngāti Apa

Annual Report 2018

Shireen Maged Tumuakoranga Executive Director Academic Management, Delivery & Rangahau PhD, MEd, BEd, BA (HDE) Awherika

Brent Sincock Tumuwhanake Executive Director People & Culture Ngāi Tahu

During 2018, Keri Milne-Ihimaera, Pakake Winiata and Grant Strang completed their tenures as Tumu (executive directors). Hone Paul Tumukahutaupua Executive Director Tauira Services & Marketing BBus, GradDipBus, DipAupiki Ngāti Manawa, Ngāti Awa, Te Arawa

Te Wānanga o Aotearoa

AHUREA (CULTURE)

Advancing mātauranga Māori

The last 12 months have been challenging ones for Te Wānanga o Aotearoa but they have also demonstrated the resilience of our kaimahi and our organisation as we continue to work towards positive outcomes for our tauira. The commitment of our kaimahi has enabled us to maintain our focus on Ngā Uara – our values – of Te Aroha, Te Whakapono, Ngā Ture and Kotahitanga, while we work to improve aspects of our organisation requiring attention. These foundational values together enable us to generate meaningful benefits in key areas of ahurea (cultural), arumoni (commercial) and hapori (community). Ahurea defines our commitment to fostering mātauranga Māori throughout Aotearoa and its importance for not only our tauira, but the community at large. We do this in a number of ways, including creating and sharing knowledge gained through our teaching and learning and through building and maintaining strong relationships with tauira, whānau and communities throughout Aotearoa.

Enhancing knowledge and understanding of mātauranga Māori both within and without Te Wānanga o Aotearoa provides a strong foundation for Aotearoa New Zealand– Māori and non-Māori alike – to grow and succeed. We take this commitment seriously and believe that providing a worldclass indigenous education experience for our tauira is a key component in enhancing the cultural identity of Aotearoa. Our tauira grow in their selfbelief and are more confident in both their own identity and the positive role they can play in the country’s future. Nearly two thirds (62%) of the course offerings at Te Wānanga o Aotearoa are in the Ahurea domain, and include the subject areas of Angitu (Māori and Indigenous Development), Te Reo Rangatira (Māori language), Hauora (health and fitness) and Toi (Māori and indigenous arts). While Te Wānanga o Aotearoa consistently monitors our progress in these areas using a number of measures, our efforts in advancing mātauranga Māori were recognised nationally in 2018 when we received two prestigious accolades at the Ngā Tohu Reo Māori - Māori Language Awards.

The awards - which are hosted by Te Taura Whiri i te Reo Māori - recognise Māori Language initiatives and activities that promote the Māori language. They also acknowledge the long-term commitment by people and groups to the ongoing challenge of Māori language revitalisation. At the awards, Te Wānanga o Aotearoa won the Mātauranga – Kaupapa Māori/ Education – Māori Medium section for our increasingly popular Taringa Punua Pāoho podcast. Taringa is a weekly podcast about all things Te Ao Māori and since its launch in mid-2017, it has consistently grown its audience both in New Zealand and around the world. In 2018 Taringa had more than 180,000 listens from people in more than 50 countries, including 21,000 from Australia, 6177 from the US and 1655 from the UK. It regularly features guest speakers from around the motu as they discuss te reo Māori, historical events, stories from different iwi and other subjects of interest to Te Ao Māori.

Te Pūrongo 2018

Mahuru Māori where participants are challenged to speak te reo Māori during the month of September (Mahuru)

Te Wānanga o Aotearoa claimed the Mātauranga – Whānui/Education – Open section at the awards for an initiative that combined te reo Māori and the world’s most popular online game,

Fortnite

Nationally, Te Wānanga o Aotearoa fulfils this role of helping people improve their te reo Māori skills by providing around 60 percent of all te reo Māori education in New Zealand, from beginners Level 1 to the elite Te Panekiretanga o Te Reo programme. Te Wānanga o Aotearoa also claimed the Mātauranga – Whānui/Education – Open section at the awards for an initiative that combined te reo Māori and the world’s most popular online game, Fortnite, which has more than 40 million players globally every month. The Te Wānanga o Aotearoa Fortnite event – in partnership with e-sports broadcaster Let’s Play Live - brought together teams of gamers and used te reo Māori in an online competition that was livestreamed to an audience of more than 10,000 people. This event was held during September (Mahuru) to help promote Mahuru Māori.

Mahuru Māori is a previous winner at the Māori Language Awards and its appeal continues to grow, with more than 3,000 people sharing the challenge on social media in 2018. A survey of participants found those who took part had a sense of belonging, increased confidence using te reo Māori at work, home and in the community, and felt challenged to further improve their te reo Māori skills. While Mahuru Māori began as an initiative for Te Wānanga o Aotearoa kaimahi, it has grown into a national and international movement that aligns with our long-term objective to be the preeminent provider of mātauranga Māori education in Aotearoa.

In 2018, Te Wānanga o Aotearoa had 7,652 EFTS enrolled on our te reo Māori courses, an increase of more than 10% from the 6,880 EFTS learning the language in 2017. One of our most popular te reo Māori programmes, the Home-Based Learning Level 1 Papa Reo, has around 1000 active tauira throughout the country and in some locations cohorts are full for much of the coming year. While the number of tauira choosing to learn te reo Māori with Te Wānanga o Aotearoa continues to grow, we also need to ensure our teaching is of the highest quality. One of the key contributors in this area is the flagship rangahau project He Rongoā

Te Wānanga o Aotearoa

tō te reo Māori, which has a key aim of investigating and developing new teaching and learning strategies and pedagogical approaches to learning te reo Māori. Other key aims of the project are to: ››

Investigate and identify the motivators and barriers around the desire for learning te reo Māori

››

Explore the psychological, emotional and spiritual influences on a learner of te reo Māori

››

Examine intergenerational trauma and impacts of colonisation, and how this has contributed to individuals learning journeys Investigate how the language can be used to heal intergenerational trauma

The major focus of the project in 2018 was data collection, which included six focus groups and conducting interviews in three case studies from across Aotearoa. Analysis of the data is currently underway, with key themes identified. Lead kairangahau Dr Acushla Deanna Sciascia (Ngaruahine Rangi, Ngāti Ruanui, Te Āti Awa) presented He Rongoā tō te reo Māori to an international audience at the Ngā Pae o Te Māramatanga International Indigenous Conference in November and received overwhelmingly positive feedback.

Her presentation was one of 17 Te Wānanga o Aotearoa kaimahi delivered at the Ngā Pae o Te Maramatanga conference. The increasing prominence of rangahau within Te Wānanga o Aotearoa meant that in 2018, for the first time in 12 years, we participated in the Performance-Based Research Funding round. This decision was underpinned by our Rangahau Strategic Objective to engage in innovative Rangahau activity that builds relationships, uplifts the profile of Te Wānanga o Aotearoa and achieves financial sustainability. Twenty-two kaimahi submitted Evidence Portfolios in the Performance-Based Research Funding round in 2018, with the outcome to be confirmed in April 2019. Te Wānanga o Aotearoa kaimahi also received further accolades for their rangahau and their mahi in 2018. Rangahau adviser Pauline Adams was awarded the Ngarimu VC and 28th Māori Battalion Doctoral Scholarship for 2018. The scholarships commemorate Victoria Cross winner Second Lieutenant Te Moana-nui-aKiwa Ngārimu and members of the 28th Māori Battalion, who served on the battlefields of Greece, Crete, North Africa, and Italy between 1941 and 1945. Her doctoral research is about bicultural identity and how society portrays and influences identity, particularly among young people.

Our senior rauangi kaiako, Sandy Adsett, was also recognised, when he was awarded an Honorary Doctorate by Massey University to acknowledge his more than 50 years’ service to Māori arts. He also received the Te Tohu o Te Papa Tongarewa Rongomaraeroa Award recognising excellence and outstanding contribution to Māori arts from Creative New Zealand. Another significant rangahau achievement in 2018 was Kaiarataki Ako Haami Hawkins, who was invited by pioneering autoethnographer and scholar, Dr Stacey Holman-Jones, to write an article in the international journal Departures in Critical Qualitative Research, Volume 7 2018. His article, The Indwelling Spirit of Rangahau, is to be published in early 2019, and presents Rangahau Māori to an international audience. By presenting his work through the Te Wānanga o Aotearoa Rangahau framework, his work demonstrates how Rangahau Māori stands on its own merits in terms of rigour and validity in an international, mainstream research context. It also paves the way for more kairangahau to showcase their work on an international platform. Combined with other work already underway, the growth of rangahau within Te Wānanga o Aotearoa indicates future developments in the area of ahurea will have a sound theoretical base immersed in mātauranga Māori and contribute strongly to our strategic objective of providing a world-class indigenous educational experience.

Annual Report 2018

In 2018 Taringa had more than 180,000 listens from people in more than 50 countries, including 21,000 from Australia, 6177 from the US and 1655 from the UK. It regularly features guest speakers from around the motu as they discuss te reo MÄ ori, historical events, stories from different iwi and other subjects of interest to Te Ao MÄ ori.

Te Wānanga o Aotearoa

INCORPORATING TE WĀNANGA O AOTEAROA VALUES INTO TONGAN CULTURE Visesio Siasau and Serene Tay

In a regular home in a regular suburb of Nuku’alofa, the capital of the Kingdom of Tonga, a Tongan artist and his Ngāti Pikiao/ Chinese wife are using what they learned at Te Wānanga o Aotearoa to transform lives. Visesio Siasau and Serene Tay have been living in Haveluloto – where Visesio grew up – for six years, having made the decision to do what they can to help their community through the medium they know best. Both hold He Waka Hiringa – Master of Applied Indigenous Knowledge degrees, are talented artists in their own right and are using their art – and their lives – as an example to others. Rather than live and practice their art anywhere else, they’re working with community groups and other interested locals in Tonga to develop their artistic skills. But in a country such as Tonga, that has its challenges. “Art is not well regarded here in Tonga,” Visesio says. “What we are pushing for is the acknowledgement and recognition of art and the significance of it.”Visesio – who

became the first Tongan artist to win the prestigious Wallace Art Award in 2015 – says by sharing what he has learned, he may inspire others. One day they hope to open a contemporary art gallery in Tonga. “There aren’t any galleries here in Tonga and to do that really would be an extension of us as artists and of what we’ve learned from Te Wānanga o Aotearoa. That is to always aspire to do things greater than ourselves, to be challenged in that way.” Their relationship with Te Wānanga o Aotearoa goes back to 2004, when Serene was a third year student and Visesio enrolled in an introductory art course. “I had seen the sculptures that he had made,” Serene says. “But it was more than just what he had created as a sculptor. It was the wairua of him. He is well and truly imbued with Tongan culture, Tongan philosophy but what really attracted me was that I knew that there was work to be done beyond us, and somehow I recognised that. “For us, art is life. It is what we do, it’s who we are, it’s all embracing.” Much

of what they do is based on aroha, or ofa in Tongan. Like the word aroha, the full meaning is lost in the English translation, Visesio says. “Ofa is a sense of love, in translation to English. Ofa is the essence of what we do as art practitioners. In translation, it is missing a lot of elements, it doesn’t grasp the depth of our language.” Serene says ofa is similar to aroha. “Like aroha, it’s more than just one thing. When we use the word aroha – or ofa – we're not simply saying we love you, we say we embrace you, not only you but those who’ve come before you and those who come after you, and that for me is what aroha is. “It’s bringing forward what our ancestors had planted, what our tūpuna have given us and that’s an aroha discipline, to bring forward the intangible and transform it into a vessel of knowledge, a vessel of healing, a vessel of love.” That feeling of aroha, or ofa, flows through their art. “What makes good art for me, really what’s important is the mana of the art, the integrity, it’s got to be pono, that it’s honest and aroha, that it’s about the love,” Serene says.

Te Pūrongo 2018

Both say their studies at Te Wānanga o Aotearoa helped develop their sense of aroha and an understanding of themselves. Visesio says it provided the spark he needed. “When I went to the Wānanga, I felt like ‘this is what I need’ because it fuelled what I wanted to do. When I came in to the Wānanga, it’s what nurtured me to be stronger in what I was doing. It was like prepping myself and enhancing myself for what I’m doing now. It was the best learning environment for me. It suits who I am as Tongan, it’s strengthened my art creativity, it’s allowed me to be who I am and enhanced the way I think.” Serene, who was a young solo mother of twins when she first enrolled with Te Wānanga o Aotearoa, says it changed her life.“When you’re quite young and you become a mamma, you’re still trying to find yourself in the world and I think Te Wānanga o Aotearoa allowed me to realise that I do have a place in this world. It really gave me the opportunity to know that education is so valuable and it’s able to open doors to the world.”

Visesio Siasau and Serene Tay Graduates of He Waka Hiringa Master of Applied Indigenous Knowledge

Te Wānanga o Aotearoa

HAPORI (COMMUNITY)

Social wellbeing for all New Zealanders

The foundations of Te Wānanga o Aotearoa are solidly built on communities and we take pride in the fact that by providing an education grounded in mātauranga Māori, we enable our tauira to make effective and valuable contributions to their communities throughout New Zealand. This focus on the development of mātauranga Māori throughout New Zealand provides long-term benefits for all New Zealanders and reflects our vision of whānau transformation through education and our strategic aim of working with communities to co-create solutions that address community needs. Hapori (community) reflects our passion for improving the social wellbeing of all members of society, giving everyone more opportunity to succeed in whatever field they choose. Te Wānanga o Aotearoa works to achieve this by providing educational programmes that meet the educational needs of whānau, hapū, iwi and communities throughout Aotearoa and doing what we can to remove some of the impediments people face in accessing world-class indigenous educational opportunities.

We work closely with our stakeholder groups to ensure that what we teach is helpful, relevant and meets the needs of the tauira, whānau or community. Hapori (community) includes the learning areas of Tūāpapa (learning to study/ESOL) and Hauora (health and fitness) and we measure success in these areas in a number of ways, including tauira increasingly sharing their skills and knowledge with their whānau, hapū, iwi and community and through more Māori being satisfied with life in general. There are numerous examples of tauira using their skills to benefit their whānau, hapū, iwi and community but completing a project specifically to provide benefits for their community is a key component of our He Waka Hiringa Master of Applied Indigenous Knowledge degree, which continues to grow in popularity.

Among the projects He Waka Hiringa tauira completed in 2018 were several which had direct connections to their iwi, hapū and whānau or addressed issues which will provide longterm benefits to Māori and other communities throughout the country, including: ››

Tiaki mana mokopuna: Protecting the rights of mokopuna

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Māori Whakamanahia: The transformative practice of music

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Matahiko: Creating a Māori visual identity using design

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Te oro o te reo, te oro o te poi: Building capability in te reo Māori through the medium of haka, within Ngāti Hauā

Of our 2018 He Waka Hiringa tauira, 34 are expected to graduate in 2019 from both Auckland and Hamilton. Te Wānanga o Aotearoa also supports other significant community events through sponsorships or partnerships with key stakeholder groups.

Annual Report 2018

Te Wānanga o Aotearoa is a principal sponsor of the week-long Waka Ama National Sprint championships, held annually at Lake Karāpiro

For three years, we have been principal sponsor of the popular television show Marae DIY, where marae throughout the country receive makeovers over a four-day period. Along with sponsoring the show, Te Wānanga o Aotearoa kaimahi are encouraged to take part in the makeovers – whether they whakapapa to the particular marae or not - and in each episode, toi kaimahi and tauira complete a special art project for the marae. Filming of the show provides an excellent opportunity for whakawhānaungatanga between Te Wānanga o Aotearoa and communities throughout Aotearoa. During 2018, nine marae took part in the show, which was broadcast on both Māori Television and TV3.

During 2018, nine marae took part in the show, which was broadcast on both Māori Television and TV3

Te Wānanga o Aotearoa is a principal sponsor of the week-long Waka Ama National Sprint championships, held annually at Lake Karāpiro. In 2018, the event attracted 1300 teams comprising 3300 paddlers from Aotearoa and overseas. This sponsorship complements the Level 4 Certificate in Waka and the Level 5 Diploma in Waka programmes run by Te Wānanga o Aotearoa and our commitment to the sport continued with the introduction in 2018 of two Level 2 Waka Ama unit standards into the New Zealand Qualifications Framework. Supporting the health and fitness of rangatahi is important to Te Wānanga o Aotearoa and is behind our ongoing sponsorship of Te Tamāhineā-Papatūānuku Junior Māori Sportswoman of the year award at the annual Māori Sports Awards. While the awards recognise success in the global sports arena, our sponsorship helps reinforce our mission of tauira success, while acknowledging success comes in many forms. Rangatahi are an important part of our future as an organisation and supporting other youth initiatives such as the largest Pacific Dance Festival in the world – ASB Polyfest – through the publication of the magazine Huarewa, exemplifies our commitment to this important demographic.

One of the biggest challenges in the youth space is helping those who have become disengaged from education so through the innovative School of Hard Knocks programme – which uses rugby to transform the lives of young people - more youth are being given the skills to face difficult challenges in life. In 2018, the programme saw 17 tauira – male and female - work towards their NCEA Level 2 fitness qualifications alongside mentoring and coaching from sporting heroes such as Sir John Kirwan, Filipo Levi and Joe Harawira. The reality TV style show - which is also supported by ACC and NZRU Rugby Smart – was developed in the UK 11 years ago and is run more than 50 times per year, with a dozen secondary schools introducing it to their curriculum. 31

Te Wānanga o Aotearoa

About 100 people attended the opening pōwhiri, and for many Ōtautahi kaimahi it was seen as part of the ongoing healing process for those who had lived through the Christchurch earthquakes.

To ensure our approach to youth education remains informed by the best available advice and research, Te Wānanga o Aotearoa hosts the annual Disruptive by Nature symposium for kaimahi to hear and learn from some of the leading innovators in youth education and others who work with and inspire young people. The symposium is backed by Rangatahi kei Runga – the Te Wānanga o Aotearoa Youth Development Strategy, that signals our organisational commitment to provide relevant, useful and innovative services and support to rangatahi that enable their success and make a difference in their lives. In 2018, 120 kaimahi attended the symposium, which featured workshops and speakers, including: ››

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Laura O’Connell Rapira director of ActionStation, an independent, crowd-funded community campaigning organisation representing over 100,000 New Zealanders. Jesse Armstrong CEO of Vaka Interactiv, a company focussed on developing cultural storytelling technology. Frances Valintine CNZM a passionate educator and technologist and founder of The Mind Lab, which was developed to empower students and educators to develop applied digital knowledge and capability.

Te Wānanga o Aotearoa has also been involved with WOMAD in New Plymouth, demonstrating ways technology can help people understand and become involved in mātauranga Māori.

Frances Valintine Founder of The Mind Lab Disruptive by Nature speaker

Along with ensuring that what we teach is in line with best practice and informed by mātauranga Māori, we also need to ensure the facilities we provide for both kaimahi and tauira is of the best possible standard. For many years, Ōtautahi kaimahi had been working out of unsatisfactory offices and at different venues throughout Christchurch, often transporting tauira resources in their own vehicles. Therefore, it was pleasing to be able to open a purposebuilt site in Ōtautahi in 2018. Along with providing a central base for Te Wānanga o Aotearoa in Christchurch, the central-city site – which has been about 10 years in the making - also provides important classroom space for tauira and office space for kaimahi in a welcoming environment.

Through our Virtual Reality pōwhiri project, more than 500 people attending WOMAD in 2018 experienced the fully immersive and realistic pōwhiri experience over the three-day festival. The virtual pōwhiri uses stereoscopic video and spatial audio techniques to ensure the immersive experience is as realistic as possible. At WOMAD, Te Wānanga o Aotearoa also launched the Kirituhi, which allowed users to create a tā moko filter on their phone camera. More than 70,000 people used the filter, which was developed as a way to share and promote mātauranga Māori throughout communities of Aotearoa. This respectful sharing of culture to both Māori and non-Māori aligns with many parts of our long-term plan, Te Pae Tawhiti, including providing a world-class indigenous educational experience and driving a culture of innovation.

Te Pūrongo 2018

At WOMAD Te Wānanga o Aotearoa also launched the Kirituhi, which allowed users to create a tā moko filter on their phone camera. More than 70,000 people used the filter, which was developed as a way to share and promote mātauranga Māori throughout communities of Aotearoa.

Te Wānanga o Aotearoa

FROM MOB TO MASTERS Hopere Chase

Hopere Chase credits his 16-year-old moko Anton with being his kaitiaki.

But leaving the Mongrel Mob, Hopere says, isn’t easy.

It’s an idea that forms part of his He Waka Hiringa Master of Applied Indigenous Studies research and one he used while completing his Bachelor of Bicultural Social Work degree and “if I do my PhD, I’ll probably use him again,” Hopere, 57, says.

“I was struggling to put food on the table. I had to go on the dole.”

The idea of having his moko as his kaitiaki came about when Hopere first held baby Anton in his arms and realised something was changing in his life and Anton was the catalyst for that change. “I looked into his face and even though he couldn’t speak, it’s like he was asking me ‘so what are you going to do now’, Hopere says.

The easy option would have been to go back to the gang.

Eventually Hopere was offered a management role but had no formal qualifications.

“In the gang, money was never a problem, from the drugs we sold or the burglaries we did.”

“The boss said I had the skill and life experience but not the qualification so in 2011 I enrolled in the Bachelor of Bicultural Social Work degree at Te Wānanga o Aotearoa.”

But things looked up for Hopere when one of his sisters found him a casual job working in the mental health sector.

“I sucked at education when I was young,” he says.

“I didn’t want to do it but eventually I had to because we had no money. At first it was just for the money, I didn’t want the job but I had to put food on the table.”

“I decided I wanted to set an example to him, which is what I hadn’t done for my kids. I was holding him wearing my patch - and I looked in the mirror and saw myself and knew something had to change.”

The job involved working with people who had mental health challenges and preparing them to re-enter the community.

What changed was that Hopere quit the Mongrel Mob – where he’d spent 27 years since joining as a teenager became a social worker and now - 16 years later - completed his Master of Applied Indigenous Knowledge degree at Te Wānanga o Aotearoa.

“I was helping guys in rehab, getting them out of hospital, which is odd because I’d spent so long putting people in to hospital. Over time I found I had the skills in my kete to do this job. And some of them were asking to work with me because I understood them. Some were going through depression,

and prison is a very depressing place so I could understand what they were going through.”

It’s not hard to figure out why. Growing up one of 13 children in a home where the sound of the car coming home from the pub signified the start of the next hiding for his mother. No comfort, no security, no support. Something like school held little attraction and he paid little attention. “There were seven of us. We’d take a small glass jar to school and go down the back of the field and sniff petrol because it made us feel good. We all ended up in gangs and I now know that they had the same sort of childhood that I did. The gangs gave us comfort, security, a home.” After completing his social work degree it was another big step up to tackle his masters.

Annual Report 2018

“This is the culmination from year one to year two to where I am today,” he says. “My kaupapa when I came in here was me looking for answers to why gangs behave like they do but through my study it turned on to myself and asked ‘why did I join the gang?’. I was suffering but I didn’t know I was suffering.” The first part of his masters study was ‘Ko Wai Au’ (Who Am I) and was something Hopere initially struggled with. “I wouldn’t talk about things that hurt me. My home life, domestic violence, gangs. I didn’t want to revisit that or to talk about it. I thought I was healed from all that but I wasn’t. I had to put all that in and He Waka Hiringa showed me how to go into that and how to come back out of it. It changed my thinking.” Hopere says it’s unlikely he would have been able to achieve his qualifications anywhere other than Te Wānanga o Aotearoa and says that’s no coincidence. “We think we came here to learn something but it was our tūpuna who sent us here. So the Wānanga has played a key role in my life. It’s made me see the future a lot clearer. The Wānanga empowers our people so much. It’s enabled us to be secure, myself and my whānau. I love it.”

Hopere Chase Graduate of Ngā Poutoko Whakarara Oranga Bachelor of Bicultural Social Work

Te Wānanga o Aotearoa

ARUMONI (COMMERCIAL)

Economic wellbeing for all New Zealanders

The Arumoni (commercial) category represents both the programmes Te Wānanga o Aotearoa provides in the business and industry sectors, but also the operations of the organisation as a whole and the way it functions to provide the best outcomes for our tauira.

The $4.9 million deficit for 2018, while disappointing, was not unexpected in what remains a volatile tertiary environment, with rising costs and ongoing funding uncertainty.

(commercial) are indivisibly linked through everything Te Wānanga o Aotearoa does.

These relationships also contribute strongly to the long-term sustainability of the organisation.

However, it is imperative Te Wānanga o Aotearoa continues to explore other efficiencies and develop alternative sources of funding so as to reduce its reliance on Government funding and reserves.

Kōkiri is a Te Wānanga o Aotearoaled business accelerator programme which began in February 2018. We partnered with Callaghan Innovation and industry leaders in the Māori economy to deliver the fourmonth programme that focuses on entrepreneurs and business start-ups that have globally-focused business ideas and high-growth potential. Kōkiri is aimed at speeding up the process of getting these business ideas into the market and investmentready. The programme is a mix of five in-residence workshops where teams receive training by industry leaders, supported by mentoring, coaching, and access to industry professionals.

As Te Wānanga o Aotearoa moves into the next phase of its ongoing development as a world-leading indigenous education provider, there is an obligation to have an increased focus on ensuring our financial sustainability.

Our Innovation Development Group leads this and two of its ongoing projects, Kōkiri and Pakihi, have been successful in both attracting funding and supporting the ongoing development of Māori businesses.

The accelerator programme is funded under the Te Pūnaha Hiringa Māori Innovation Fund administered by the Ministry of Business, Innovation and Employment and the aims of Kōkiri align with our mission of tauira success.

This focus has been sharpened in the last 12 months due to the reporting of our first financial deficit in more than a decade.

This work illustrates how the key focus areas of Ahurea (culture), Hapori (community) and Arumoni

In late 2018 four Kōkiri participants travelled to Vietnam to attend the TechFest conference and take part in

Currently, 27% of our programmes are in the Arumoni category, mainly in the business area, but we recognise the need to do more to support employment outcomes for tauira – particularly those who come to us with low or no prior qualifications - and acknowledge that relationships with key industry and community stakeholders are key to this.

The significant redesign of Te Puna Mātauranga (Head office) and takiwā leadership in late 2018 will bring anticipated annualised salary savings of around $3 million and, along with other efficiencies, will go some way towards the longterm financial sustainability of Te Wānanga o Aotearoa.

Te Pūrongo 2018

Kōkiri Te Wānanga o Aotearoa-led business accelerator programme

Pakihi a nationwide series of free business

Pakihi is targeted at three different phases of business growth. ››

the Accelerate Vietnam programme, which is designed to develop global confidence amongst emerging Kiwi entrepreneurs. The visit was the first in Asia New Zealand’s Accelerate Southeast Asia initiative and helped build relationships in the region and highlight opportunities for the Kōkiri participants. Also in 2018, Te Wānanga o Aotearoa launched Pakihi, a nationwide series of free business workshops and mentoring programmes to help Māori grow their business ideas. The programme - which includes 200 business workshops from Kaitaia to Invercargill – is being delivered by Te Wānanga o Aotearoa and business partners Crowe Horwath and Aotahi, with support from the Māori Innovation Fund.

Whakarautia – Pre-startup – for Māori who are not yet in business, but are motivated or curious and keen to take the next step.

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Te Uma represents businesses which have been operating for between one and 18 months, with workshops focused on improving profitability, marketing and networking.

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Whānaua, or growth, workshops provide training to help businesses increase either their number of employees, their product or service offerings or expanding to more locations.

Thirty Waikato Māori businesses signed up for the initial Pakihi workshops while workshops were also held throughout the country, with more scheduled during 2019.

Like Kōkiri, the Pakihi programme aligns with our mission of tauira success and our vision of whānau transformation through education. We also support small businesses making their mark in the world through our sponsorship of the Gate to the Globe television show, which profiles ‘innovative Kiwis smashing it on the world stage’. These three initiatives provide further support for the thousands of Te Wānanga o Aotearoa tauira who have graduated from our small business programmes over the years and continue to inspire others. Along with supporting Māori businesses, we also have a firm commitment to increase the number of Māori and Pasifika working in the trades sector, which is the aim of the Māori and Pasifika Trades Training initiative. It provides fees free tertiary places for Māori and Pasifika learners aged between 16 and 40 wanting to study in the areas of forestry, infrastructure works and construction.

Te Wānanga o Aotearoa

In 2017 Te Wānanga o Aotearoa established its own consortia to better connect with relevant stakeholders, to identify and support economic development and to be responsive to their needs.

apprenticeships and/or further industry training at level 4 and above.

In 2018 we continued to build and maintain these relationships with these stakeholder groups, which included:

Another important development has been the Relationship Agreement signed with Auckland Council. It is a continuation of an already established alliance between the two organisations, which originally started with ATEED’s Tāmaki Herenga Waka Festival and the Māori business network Te Whariki in 2016.

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Iwi and Pasifika

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Employers

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Government entities

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Industry Training Organisations, and

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Industry training providers

These relationships have begun to produce positive outcomes around the identification and recruitment of tauira for the programmes, support with recruitment activities, work placements and experiences and transitioning tauira into sustainable employment,

Work continues in this area to produce desired outcomes for both our tauira and stakeholders.

The agreement has the overarching goal of celebrating and promoting Auckland’s Māori identity and Māori economic development, something both parties are committed to. Partnerships such as these are important and provide opportunities for Te Wānanga o Aotearoa to continue to support Māori being successful as Māori throughout the country.

The provision of business programmes remains crucial to Te Wānanga o Aotearoa and these offerings are likely to expand to include more technology-focussed offerings and others which lead to positive employment outcomes for tauira studying under Youth Guarantee or Foundation skills and others such as Corrections. Along with fulfilling these aims, the Arumoni sector of Te Wānanga o Aotearoa will continue to develop Māori business capability and assist tauira with low or no prior qualifications into employment, thereby helping fulfil our vision of whānau transformation through education.

Annual Report 2018

Also in 2018, Te Wānanga o Aotearoa launched Pakihi, a nationwide series of free business workshops and mentoring programmes to help Māori grow their business ideas. The programme - which includes 200 business workshops from Kaitaia to Invercargill – is being delivered by Te Wānanga o Aotearoa and business partners Crowe Horwath and Aotahi, with support from the Māori Innovation Fund.

Te Wānanga o Aotearoa

THE BUSINESS OF ART Oriwa Morgan-Ward

Oriwa Morgan-Ward is in her happy place. And Te Wānanga o Aotearoa helped her find it. “I have always desired to be where I am today,” she says. Where she is today, is in her typically cluttered artistic workspace in her hometown of Putaruru. And while she’s busy creating original art works, she’s also planning her business strategy. That mix of art and business are key planks of her long-term plan and areas where Te Wānanga o Aotearoa has helped Oriwa build her skills. “I want to be my own business and I want to be a Māori presence as an artist in Putaruru. So I’m stacking my skillset,” she says. And she is well on the way to achieving those objectives. Oriwa finished the Maunga Kura Toi – Rauangi arts degree at Toimairangi in Hastings in 2016 and in 2017 completed a Diploma in Adult Education. Her education skills came in handy during an arts residency at Te Awamutu Museum, where she ran holiday programmes and art workshops for the community.

She has now enrolled in Pakihi – a nationwide series of free business workshops and mentoring sessions being delivered by Te Wānanga o Aotearoa and business partners Crowe Horwath and Aotahi, backed by the Māori Innovation Fund – He kai kei aku ringa and managed by the Ministry of Business, Innovation & Employment. Pakihi was launched in July and more than 300 people have attended workshops in Christchurch, Invercargill, Dunedin, Porirua, Lower Hutt, Hamilton, Auckland, Nelson and Hastings. Oriwa took part in the Whakarautia – Getting Into Business workshop and says it was a fabulous experience. “It was exactly what I needed to help with my business concept of being a self-employed artist. For me, it was welcoming, it has tikanga included – which is important – and it is business with a Māori touch, coming from Māori business people themselves. It had a Māori point of view.”

She says the programme has given her confidence that she’s on the right track. “For me, it’s the continuance of what I’m doing. The next step was to do something like that. We need programmes like Pakihi to provide us with pathways. Being self-employed is the hardest route to go down, it takes a lot of self-discipline so I’m still going to be learning, adding to my kete, building up my business, being self-sustaining and the having the mana of being a business owner,” she says. “The beautiful thing about this is that we’re reigniting that DNA that’s already in our whakapapa from our tūpuna, it’s not a new thing. We’re relearning the thinking of our people and I’m looking forward to continuing that journey.”

Te Pūrongo 2018

ORIWA:

Top tips for Māori in business ››

Learn to say no. Saying yes to every opportunity isn’t always the best choice. Learn to say yes to those things that align with your own kaupapa/agenda and lean back and allow the magic to happen.

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Take time out for yourself. Take time to be in your happy place, whether it be meditation, prayer, yoga, zumba or whānau time. Allowing time for yourself allows you to be of better service to others.

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Be passionate about what you do and the money will follow.

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Know your value and ask for what you deserve.

Oriwa Morgan-Ward Graduate of Maunga Kura Toi Rauangi & Diploma in Adult Education

Te Wānanga o Aotearoa

STATEMENT OF SERVICE PERFORMANCE

Annual Report 2018

Te Huanganui Outcomes Framework

Ahurea Cultural

Hapori Community

Arumoni Commercial

NgÄ Mahinga Here o te Mahere HaumÄŤtanga Investment Plan Performance Commitments

Te tahua Financial Report

Te Wānanga o Aotearoa

TE HUANGANUI Outcomes Framework Te Huanganui is Te Wānanga o Aotearoa outcomes framework that sets out the pathway to achievement of our vision and mission. The name Te Huanganui refers to the wider benefits or advantages that result from our work, but more literally, the fruits of our labour. Te Huanganui encapsulates the unique contribution of Te Wānanga o Aotearoa to tertiary education and Aotearoa and sets out the indicators we will use to measure our performance. At a societal level, the three outcomes of Te Huanganui; Ahurea (cultural), Hapori (community) and Arumoni (commercial), reflect a holistic approach to transformation within a mātauranga Māori context. The following diagram provides a high-level representation of Te Huanganui as approved in the 2017 - 2019 Investment Plan.

Te Pūrongo 2018

TAKA

NGA ME NGĀ M

HĀ

lan

Zea

for a l l New

llbeing l we

NGĀ HUA | OUTPUTS

Partner for success

Deliver a world-class indigenous educational experience

NGĀ PANGA | IMPACTS

Tauira connected with their iwi, hapū, marae or community

cia

HAPO

NGĀ HUA | OUTPUTS

REA > CULTURA

Tauira confident in their identity and culture

Māo

Tauira have skills and knowledge to succeed

mātauranga

NGĀ PANGA | IMPACTS

ancing

NGĀ PANGA | IMPACTS

AHU

Adv

RI > COMMUN

ITY

GĀ

KA HA

NGĀ HUA | OUTPUTS Ensure sustainability through educational excellence and drive a culture of innovation

ono

IAL rs MONI > CO MMERC nde a mic l a Ze wellbe ing for all New ARU

Te Wānanga o Aotearoa

AHUREA (Culture) Advancing mātauranga Māori

We will make a difference:

We will achieve this by:

Our tauira are confident in their identity and culture

Maintaining a suite of high quality mātauranga Māori programmes

Delivering a world-class indigenous educational experience

Contributing to achievement of the Māori language strategy- Te Rautaki Reo Māori

Our rangahau contributes to mātauranga Māori

Annual Report 2018

Ngā putanga / Outcome 1.1 We will increase the proportion of Māori and non- Māori who can speak some te reo Māori from 21% of Māori and 3.7% of non-Māori in the 2018 Census Ahurea represents the ideal of advancing mātauranga Māori to provide the foundation for Māori to succeed as Māori. We do this by generating and sharing knowledge of our language, culture and heritage underpinned by a te ao Māori worldview. In 2018 62% of EFTS or 19,236 tauira studied Ahurea cultural programmes. We are experiencing unprecedented growth in demand for te reo and tikanga programmes and this places us in a unique position to play a lead role in the revitalisation of te reo Māori.

Ngā pānga / Impact 1.2 Our tauira are confident in their identity and culture

1.2.1 Proportion of tauira who confirm an increased understanding of mātauranga Māori

2017 Result

2018 Target

2018 Result

75%

80%

78%

Tauira success requires more than skills transfer – our tauira leave us knowing more about who they are, where they come from and where they are going. Although not all of our programmes have a cultural focus, our kaupapa runs through everything we do and we expect this to have a tangible impact on their knowledge of te ao Māori. We measure our impact on tauira through the annual Graduate Survey. In 2018 the Survey was sent to a cohort of 13,257 recent graduates and 3,788 (or 29%) took the opportunity to respond. Although it missed the target, the result of 78% was the second year of improvement in the proportion of tauira reporting that their understanding of mātauranga Māori had increased. In 2019 we will delve more deeply into what it means to be a wānanga, resulting in clearer articulation that will further enhance tauira understanding of mātauranga Māori.

Te Wānanga o Aotearoa

Ngā hua / Outputs 1.3 Maintain a suite of high quality mātauranga Māori programmes

1.3.1

Quality of mātauranga Māori programmes regularly reviewed

2017 Result

2018 Target

2018 Result

4 reviews

3 reviews

4 reviews

We are committed to providing a suite of high quality programme pathways and with a number of longstanding mātauranga Māori programmes, the internal review process provides a timely assessment of how we can improve. In 2018 we reviewed the following four programmes: ››

Certificate in Papa Reo (Level 1)

››

Te Pokaitahi Reo (Level 3) and Te Pūtaketanga o te Reo (Level 4)

››

Te Kunenga o Te Ao Tikanga (Level 4)

››

Certificate in Rongoā Māori Appreciation (Level 4)

A key focus for programme audits and reviews for 2018 was learning hours. This led to a project that will see Te Ara Reo Māori being the first programme to be delivered from the iQualify™ learning management system. This project will result in a number of enhancements to our most popular reo programme and it will also enable us to better evidence tauira learning hours. The learnings from this will also be used as we launch other programmes on the platform. 1.4 Contribute to achievement of the Māori Language Strategy - Te Rautaki Reo Māori

1.4.1

Deliver Māori language and cultural initiatives

2017 Result

2018 Target

2018 Result

Achieved

10 initiatives

Achieved

In order to advance mātauranga Māori and contribute to the uptake of te reo Māori at a societal level, Te Wānanga o Aotearoa goes beyond its role as a tertiary education provider to develop and implement numerous initiatives that encourage New Zealanders to kōrero Māori. The following list highlights key initiatives for 2018: ››

Mahuru Māori continues to grow in popularity with close to 3,000 registered participants taking up the challenge to speak te reo for a day, a week or the whole month of September

››

there were several initiatives to support Te Wiki o te reo Māori including a Fortnite challenge where pro gamers were taught simple te reo terms and translate Fortnite map placenames, another initiative was the creation of a new resource featuring common technology terms

Te Pūrongo 2018

››

the audience for Taringa, a weekly podcast about all things te ao Māori, continued to grow with more than 180,000 listens from people in more than 50 countries

››

Dr Acushla Deanne Sciascia led kairangahau in the second year of the flagship rangahau project He Rongoā tō te reo Māori

››

the Aotearoa Scholarship Trust provided a range of scholarships to support the higher education aspirations of tauira

››

we continued to build awareness of Matariki through a landing page on our website

››

we supported major cultural events such as Waka Ama Sprint Nationals, ASB Polyfest and WOMAD

››

our kaimahi and tauira helped to renovate nine marae in the second year of our sponsorship of Marae DIY

››

we delivered He Tauawhi Māori Cultural Awareness programme to large corporate organisations

1.5 TWoA rangahau contributes to mātauranga Māori

1.5.1

Proportion of degree kaiako with an approved Individual Rangahau Plan (IRP)

1.5.2

He Waka Hiringa graduate research outputs

2017 Result

2018 Target

2018 Result

77%

60-75%

55%

Due to a large number of degree kaiako leaving the organisation in 2018, the proportion with an Individual Rangahau Plan (IRP) dropped to 55%. An IRP is a core expectation of degree-teaching kaiako and there will be a renewed focus on this in 2019. Although there were less IRPs, confidence is growing with 17 kaimahi having their abstracts accepted and presenting at Ngā Pae o Te Māramatanga International Indigenous Conference and 22 kaimahi submitting evidence portfolios to the Performance-Based Research Fund (PBRF) Quality Evaluation. He Waka Hiringa is our flagship masters programme where graduates contribute to mātauranga Māori through the completion of a rangahau project that benefits hapū, iwi or the community. At the time of writing this report there were 11 confirmed graduates (or research outputs). However this number is expected to increase to 34 as a number of externally assessed completions are finalised. Although the result fell short of the target, this is still 34 rangahau projects that are contributing to Māori health and wellbeing.

Te WÄ nanga o Aotearoa

HAPORI (Community) Social wellbeing for all New Zealanders

We will make a difference:

We will achieve this by:

Our tauira are connected with their iwi, hapĹŤ, marae or community Partnering for success

Tauira are actively sought after by their communities and industry

TWoA is recognised as a reputable and desirable national provider

Annual Report 2018

Ngā putanga / Outcome 2.1 We will increase the proportion of Māori satisfied with life overall to >80% in the 2018 Census' Hapori reflects our desire to improve the social wellbeing of all New Zealanders resulting in a more equitable society where all New Zealanders have the opportunity to succeed. In 2018 11% of EFTS or 3,803 tauira studied Hapori programmes such as learning to study, ESOL or health and fitness. Hapori is also reflected in our community based delivery model with over 120 sites nationwide – we are in the community and for the community.

Ngā pānga / Impact 2.2 Our tauira are connected with their iwi, hapū, marae or community

2.2.1

Proportion of tauira who are sharing their new skills and knowledge with whānau, hapū, iwi or community

2017 Result

2018 Target

2018 Result

86%

85%

88%

Our tauira are strengthened through the meaningful connections they make while studying with us. We achieve this through our amazing kaiako and unique delivery approach that includes an emphasis on kanohi ki te kanohi learning and noho marae delivery. We measure our impact through the Graduate Survey (see 1.2.1 on page 47 for survey summary) and this year we exceeded the target for the proportion of tauira who are sharing their new skills by 3%. In 2019 we will determine our future Mix of Provision (MoP) – this is not just about ‘what’ we deliver, it is also about ‘how’ and ‘where’ we deliver, and iwi and community connections will be a key consideration of this.

Te W훮nanga o Aotearoa

Ng훮 hua / Outputs 2.3 Tauira are actively sought after by their communities and industry

2.3.1

2017 Result

2018 Target

2018 Result

73%

85%

78%

Stakeholders satisfied

Efforts to more actively manage stakeholders through the stakeholder database began to pay off in 2018 with responses to our annual Stakeholder Survey up 110%. The survey was sent to a cohort of 264 active stakeholders with 74 (or 28%) taking the opportunity to provide feedback on how we are going and where we can improve. Overall, our stakeholders rated our reputation as good and although we did not meet the target, we are moving in the right direction with a 5% improvement on the 2017 result. It is anticipated that satisfaction will continue to improve as we seek to be more intentional with stakeholder relationships. This includes agreement to a Stakeholder Plan that sets out who our key stakeholders are, why they are important and how we will meet their needs. 2.4 TWoA is recognised as a reputable and desirable national provider

2.4.1

Proportion of tauira who would recommend TWoA to friends and wh훮nau

2017 Result

2018 Target

2018 Result

98%

95%

98%

We believe we are on the right track when our tauira would recommend us to their nearest and dearest and we use the Graduate Survey (see 1.2.1 on page 47 for survey summary) to monitor this. Through the survey, our tauira speak very positively of their experience with comments that acknowledge the high calibre of our kaiako, student support and learning environment. Pleasingly, the result for tauira who would recommend TWoA to friends and wh훮nau has remained at 98% since we first asked the question in 2016. We are honoured by this consistently high result. At the same time, we are conscious of the responsibility we have to maintain the uniqueness of our tauira experience as we undergo a period of significant change.

Te Pūrongo 2018

Mataa Tua Tauira of Ngā Poutoko Whakarara Oranga Bachelor of Bicultural Social Work

Te WÄ nanga o Aotearoa

ARUMONI (Commercial) Economic wellbeing for all New Zealanders

We will make a difference:

Tauira have the skills and knowledge to succeed

Meet Investment Plan commitments

Deliver a suite of high quality programmes that provide pathways to further education or employment

We will achieve this by:

Ensure sustainability through educational excellence/Drive a culture of innovation

Diversify revenue streams to reduce reliance on government funding

Innovate teaching and learning practices to enable a positive, engaging and accessible tauira experience

Annual Report 2018

Ngā putanga / Outcome 3.1 Increase the proportion of New Zealand households with adequate income from 57% (Statistics NZ, Household Economic Survey) Arumoni recognises the interconnectedness between mātauranga Māori, the strength of communities and economic wellbeing. As a tertiary provider, it is also about our responsibility to add value to the Government’s investment by impacting the economic advancement of our tauira and their whānau. In 2018 27% of EFTS or 7,927 tauira studied Arumoni programmes such as business, computing, teaching and social work. Many tauira start their higher education journey with us and while many of our programmes do not have a vocational focus, our firm expectation is that regardless of what they study, it will have a positive impact on all areas of their lives.

Ngā pānga / Impact 3.2 Tauira have the skills and knowledge to succeed

3.2.1 Proportion of tauira who reported a positive employment-related outcome

2017 Result

2018 Target

2018 Result

61%

67%

59%

We aim to transform tauira to think for themselves, plan for themselves and provide for themselves and their whānau, and we use the Graduate Survey (see 1.2.1 on page 47 for survey summary) to monitor the cultural, social and economic impact of studying with us. At 59%, the proportion of tauira who reported a positive employment-related outcome did not reach the target. This is largely due to the shift in provision towards cultural programmes. There were over 1,000 fewer EFTS in arumoni/commercial programmes and Youth Guarantee EFTS were reduced by more than half in 2018. We take seriously our responsibility to help tauira with low, or no, prior qualifications that come to us seeking an employment outcome. As part of the Future MoP Project, and alongside the vocational education reforms, we will better align vocational provision with industry and iwi needs and provide more direct pathways to employment.

Te Wānanga o Aotearoa

Ngā hua / Outputs 3.3 Meet Investment Plan Performance Commitments

3.3.1

EFTS target

3.3.2 Surplus 3.3.3

Performance commitments

2017 Result

2018 Target

2018 Result

98.9%

99-102%

94.6%

-3%

Not Met

Met

Not Met

There were significant shortfalls across all the funding categories resulting in a $9.2 million less than budget Student Achievement Component (SAC) funding including: ››

SAC Level 3 and above enrolments were impacted by an ongoing decline in demand for degrees, and shifts in the mix of provision to lower funding categories;

››

as with other providers, our SAC Level 1 and 2 enrolments were heavily impacted by implementation issues with Corrections delivery leading to a significant under-delivery of EFTS allocated through the competitive process; and

››

Youth Guarantee was more than halved as it was impacted by sanctions imposed by NZQA following ongoing issues with moderation and assessment.

Our commitment to providing accessible, fee free programmes means we are highly reliant on Tertiary Education Commission (TEC) funding. The significant reduction in SAC revenue, and limited opportunity to reduce costs due to the restructure, had a major impact on our financial performance resulting in a deficit of $4.9 million. The Investment Plan performance commitments are detailed in the following section. In 2019 we will be focussed on Te Pae Tata that sets out three short-term priorities to improve educational and financial performance and sustainability. 3.4 Deliver a suite of high quality programmes that provide pathways to further education or employment

3.4.1

EER capability in self-assessment and educational performance

2017 Result

2018 Target

2018 Result

Not Yet Confident

Confident

Not Yet Confident

The External Evaluation and Review (EER) was completed in September 2017 with Te Wānanga o Aotearoa evaluated in accordance with the Mātauranga Māori Evaluative Quality Assurance Framework – Te Hono o Te Kahurangi. The EER result saw Te Wānanga o Aotearoa downgraded to a Pounamu Hukihuki or Category 3 rating. The 2017 result has been updated to reflect this.

Te Pūrongo 2018

Whilst the report recognised that the vast majority of provision is of a very high standard and provides immense value and benefit to the many communities we serve, the overall result was due to issues with our academic structures, consistency around our self-assessment processes and our ability to act in a timely manner to resolve issues when they arose. A Quality Action Plan has been developed and will be actioned throughout 2019 to address the issues identified in preparation for the next EER. 3.5 Diversify revenue streams to reduce reliance on government funding

3.5.1 Increase proportion of funding from non-government sources

2017 Result

2018 Target

2018 Result

14%

15.5%

13%

Due to a strategic decision to provide fee free programmes, Te Wānanga o Aotearoa is heavily reliant on SAC funding. Therefore, this target has been developed to track a progressive move to increase income from other sources. For Te Wānanga o Aotearoa the main sources of non-government income are interest, contract revenue and tauira fees. Due to less tauira studying fee-paying degree programmes and, to a lesser degree, a drop in revenue from international tauira fees, non-government income declined in 2018. In 2019 there will be a renewed focus on increasing alternative income through key strategic initiatives. 3.6 Innovate teaching and learning practices to enable a positive, engaging and accessible tauira experience

3.6.1 Tauira satisfaction

3.6.2 Implement Blended Learning Strategy

2017 Result

2018 Target

2018 Result

86%

>90%

87%

Strategy developed

Strategy implemented

Achieved

We use the Graduate Survey (see 1.2.1 on page 47 for survey summary) to monitor tauira satisfaction. Although we fell short of the target at 87%, it was pleasing that tauira satisfaction improved on the 2017 result. An analysis of the survey results showed that most tauira have a positive experience and they also gave us some helpful feedback on areas we can improve such as communication, our enrolment system and some programme resources. In 2018 we took great strides in blended learning by partnering with The Open Polytechnic to pilot Te Ara Reo Māori on the iQualify™ platform. The learnings from this pilot will have implications for our blended learning strategy and it will be a key consideration as we determine what we deliver, where we deliver and how we deliver through the Future MoP Project.

Te Wānanga o Aotearoa

Cost of Service Statement For the year ending 31 December 2018 Group Actual 2017 $000

Group Budget 2018 $000

Group Actual 2018 $000

Parent Actual 2017 $000

Parent Actual 2018 $000

Ahurea Cultural

83,831

72,151

82,249

84,889

88,206

Hapori Community

19,518

44,275

23,630

16,511

17,080

Arumoni Commercial

53,320

47,554

41,782

56,591

44,385

156,669

163,980

147,661

157,992

149,671

Ahurea Cultural

71,539

71,368

84,581

76,313

86,123

Hapori Community

30,457

43,547

19,494

22,398

19,114

Arumoni Commercial

51,509

46,550

48,509

56,120

49,462

153,505

161,465

152,584

154,832

154,699

3,163

2,515

(4,921)

3,160

(5,028)

Revenue

Total revenue Expenditure

Total expenditure Operating surplus/deficit

The Cost of Service statements include budget figures from the 2017-19 Investment Plan as approved by Te Mana Whakahaere on 31 August 2016. We note that due to funding timelines, the Investment Plan budget figures differ from the budget approved by Te Mana Whakahaere on 13 December 2017 and presented in the Statement of Comprehensive Revenue and Expense. At outcome level, the 2018 actual figures reflect shifts within outcome groupings detailed in the outcomes framework mix of provision (detailed in the following section). Overall the 2018 Cost of Service reflects the reality that although Tertiary Education Institutions can make in-year adjustments to the mix of programmes delivered, it takes much longer to adjust the operational costs behind this.

Outcomes Framework Mix of Provision The following table shows EFTS provision for each outcome group for the 2017-2019 Investment Plan period. The EFTS totals may differ due to rounding.

2019 Planned

2018 Planned

2018 Actual

2017 Actual

Arumoni – Commercial

6,932

6,807

5,379

6,444

Hapori – Community

3,974

3,871

2,112

2,435

Ahurea – Cultural

9,100

9,377

12,059

11,307

20,006

20,054

19,550

20,186

Outcome group

Total

Annual Report 2018

The following table shows EFTS provision for each discipline within each outcome group for the 2017-2019 Investment Plan period. The EFTS totals may differ due to rounding.

2019 Planned

2018 Planned

2018 Actual

2017 Actual

Arumoni - Commercial

6,932

6,807

5,379

6,444

Te Arawhānui (business)

2,720

2,925

3,045

2,943

Te Arawhānui (computing)

1,107

1,343

635

1,362

583

542

285

351

Te Hiringa (health and social services/youth work)

1,274

1,094

906

1,052

Umanga (skills, trades and vocations)

1,194

867

509

736

Hapori - Community

3,974

3,871

2,112

2,435

Tūāpapa (learning to study/ESOL)

2,587

2,496

1,659

1, 849

Hauora (health and fitness)

1,388

1,375

454

586

Ahurea - Cultural

9,100

9,377

12,059

11,307

Angitu (Māori and indigenous people's development)

2,190

2,167

2,940

2,999

Te Reo Rangatira (Māori language)

5,618

5,856

7,651

6,884

Toi (Māori and indigenous arts)

1,292

1,354

1,468

1,424

20,006

20,054

19,550

20,186

Outcome group/discipline

Te Hiringa (education)

Total

There has been a significant reallocation of EFTS from Hapori, and to a lesser degree Arumoni, to Ahurea within the 2017-2019 plan period. During 2018 overwhelming demand for beginner te reo Māori programmes continued to soak up shortfalls in other areas due to: ››

conditions imposed by the NZQA that meant we were unable to deliver some Hapori foundation programmes, including a large number of youth guarantee programmes;

››

a significant reduction in demand for computing programmes;

››

less demand for degree-programmes; and

››

implementation issues delivering Corrections EFTS allocated through the Level 1 and 2 competitive process.

Te Wānanga o Aotearoa

Ngā Mahinga Here o te Mahere Haumītanga Investment Plan Performance Commitments This section includes performance commitments from Te Wānanga o Aotearoa 2017-2019 Investment Plan that is negotiated with the TEC. These targets align strategic objectives with government goals set out in the Tertiary Education Strategy. The 2018 results are interim as they are subject to validation by the TEC following submission of the final single data return in April 2019. The TEC publishes the actual results on their website annually and the 2017 results in this report have been updated accordingly. During 2018 the TEC implemented changes to the methodology for a number of EPIs and we agreed to new set of targets that will apply from 2019.

Attracting and engaging priority learners Proportion of SAC eligible EFTS that are:

Māori

Pasifika

NQF Level

2016 Actual

2017 Actual

2018 Target

2018 Interim Result

Level 1 and 2

12%

13%

12%

11%

Level 3 and above

43%

40%

43%

39%

Level 4 and above

33%

27%

30%

25%

Level 1 and 2

Level 3 and above

Level 4 and above

Level 3 and above

12%

Level 4 and above

10%

Under 25

Te Wānanga o Aotearoa continues to attract large numbers of Māori and Pasifika tauira. However, due to the significant increase in European tauira studying te reo Māori programmes, there has been a downward trend in the proportion of Māori and Pasifika tauira since 2016. In 2018 this meant we missed every Māori and Pasifika participation target apart from the result for Level 1 and 2 Pasifika tauira. The shift in our demographic profile and reduction in Youth Guarantee EFTS also saw the proportion of tauira under the age of 25 drop by 2% and both results fell well short of the target. At the time of writing the 2017-2019 Investment Plan we did not anticipate the speed or scale of this shift in our tauira population. During 2018 the TEC implemented changes to the methodology for EPIs and we agreed to new participation targets that will apply from 2019.

Te Pūrongo 2018

Sione Uasi Tauira of Ngā Poutoko Whakarara Oranga Bachelor Bicultural Social Work

Te WÄ nanga o Aotearoa

SAC Level 1 â&#x20AC;&#x201C; 2 2016 Actual

2017 Actual

2018 Target

2018 Interim Result

Successful course completion rate (SAC eligible EFTS)

76%

75%

74%

Qualification completion rate (SAC eligible EFTS)

68%

70%

66%

Student retention rate (SAC eligible student count)

63%

64%

70%

67%

Student progression (SAC eligible student count) from levels 1 and 2 to a higher level

52%

45%

52%

Performance issues with a handful of foundation programmes led to a 2% drop in course completions in 2018. This had a flow-on effect to the qualification completions rate and three of the four targets were not met. Despite this, retention continues to trend upwards, with a 3% improvement on the previous year, and progression remained steady at 52%.

Annual Report 2018

SAC Level 3 and above 2016 Actual

2017 Actual

2018 Target

2018 Interim Result

Level 3 and above

79%

78%

83%

76%

Level 4 and above

79%

83%

74%

Level 3 and above

74%

72%

78%

70%

Level 4 and above

74%

73%

78%

68%

Level 3 and above

77%

75%

81%

73%

Level 4 and above

77%

81%

72%

Level 3 and above

77%

76%

82%

71%

Level 4 and above

79%

77%

82%

71%

Level 3 and above

74%

75%

80%

69%

Level 4 and above

74%

76%

80%

66%

Level 3 and above

65%

66%

68%

63%

Level 4 and above

65%

68%

61%

Level 3 and above

71%

76%

65%

Level 4 and above

72%

74%

76%

63%

Level 3 and above

69%

73%

75%

61%

Level 4 and above

69%

78%

75%

60%

77%

75%

80%

75%

74%

71%

78%

71%

75%

73%

78%

72%

39%

38%

44%

41%

39%

44%

43%

44%

38%

all tauira

under 25 Successful course completion rate (SAC eligible EFTS) Māori

Pasifika

all tauira

under 25 Qualification completion rate (SAC eligible EFTS) Māori

Pasifika

all tauira Student retention rate (SAC student count)

Māori

Level 3 and above

Pasifika all tauira Student progression (SAC student count)

Māori Pasifika

Levels 1 to 3, to a higher level

A downward trend in course completions due to some low performing provision saw the overall rate for level 3 and above drop by 2%, and the rate for level 4 and above drop by 5% on 2017. This trend was generally consistent across all categories (under 25, Māori, Pasifika), leading to a significant decline in qualification completion rates.

Te WÄ nanga o Aotearoa

Although there were more positive signs in the other measures, with retention rates remaining steady and progression improving by 3%, it was disappointing that none of the 2018 targets were met. In 2019 we will consolidate our current MoP and directly address any low performing provision. Newly formed regional performance and quality teams will also work to enhance connectivity and responsiveness at takiwÄ level.

Youth Guarantee

Successful course completions rate for: (YG eligible EFTS)

Qualification completions rate for: (YG eligible EFTS)

Student retention rate for: (YG student count)

Student progression from levels 1 and 2 to a higher level from: (YG student count)

NQF Level

2016 Actual

2017 Actual

2018 Target

2018 Interim Result

Level 1

65%

70%

Level 2

61%

53%

70%

58%

Level 3

64%

54%

70%

62%

Level 1 and 2

63%

53%

75%

23%

Level 3

53%

45%

60%

58%

Level 1

60%

Level 2

66%

57%

65%

49%

Level 3

61%

60%

70%

48%

Level 1

45%

48%

40%

Level 2

27%

25%

20%

Level 3

17%

20%

12%

Youth Guarantee provision was halved in 2018 (from 455 EFTS to 230 EFTS) and, at the time of writing this report, there are a number of results awaiting external validation. Although the targets were not met, the results show some improvement in the course and qualification completion rates and it is expected that these will further improve when all the results have been finalised. There are no results for Level 1 as the TEC only counts the highest level of qualification completed in the year and tauira are enrolled in a Level 1 and 2 programme.

Te PĹŤrongo 2018

Other commitments 2016 Actual

2017 Actual

2018 Target

2018 Interim Result

The amount of external research income earned ($000)

$60

$100

The number of research degrees completed

The number of international student EFTS

154

128

There was no external research income in 2018. At the time of writing this report there were 11 confirmed graduates (or research degree completions) however this number is expected to increase to 34 as a number of externally assessed completions are finalised. A decision was made to withdraw from international provision in 2018. This meant that we only delivered 46 international EFTS and there were no new enrolments from mid-year.

Te WÄ nanga o Aotearoa

Tauira Profile

Tauira

The following tables provide an overview of tauira demographics from 2014.

Year

Tauira

2018

30,613

2017

31,636

2016

31,291

2015

30,467

2014

32,235

Tauira numbers have remained relatively static over the last five years due to the capped funding environment. However, there has been a significant shift within our tauira demographic profile over the 2017-2019 plan period as an increasing number study te reo MÄ ori programmes.

EFTS Year

Overall

SAC 1-2 EFTS

SAC 3+ EFTS

Youth Guarantee

2018

19,558

5,420

13,908

230

2017

20,199

5,399

14,276

455

2016

20,242

4,883

14,804

523

2015

19,987

5,231

14,123

590

2014

20,713

5,621

14,469

576

Annual Report 2018

Tauira Ethnicity Please note that these figures may add up to more than 100% as tauira identify with more than one ethnicity Year

MÄ ori

European

Asian

Pasifika

Other

2018

51%

44%

12%

2017

54%

40%

12%

10%

2016

55%

36%

12%

11%

2015

55%

34%

12%

11%

2014

54%

36%

12%

11%

Tauira Age Year

Under 25

25 to 39 Years

40 Years +

2018

11%

36%

53%

2017

14%

36%

50%

2016

15%

33%

52%

2015

16%

32%

52%

2014

17%

32%

52%

Te Wānanga o Aotearoa

Equal Opportunities Te Wānanga o Aotearoa is committed to providing open, accessible and inclusive study and employment opportunities for all. This commitment is embedded in ngā uara, our values, that are considered as part of our policies and practices and everything we do as an organisation. Equal Educational Opportunities Te Wānanga o Aotearoa has a diverse tauira population unlike any other New Zealand tertiary education organisation. Of 30,613 tauira: ››

51% are Māori, 44% European, 9% Pasifika, 12% Asian;

››

71% are female and 29% male;

››

half are over 40 years of age (53%);

››

23% had no secondary qualifications and 34% had no prior tertiary qualification;

››

13% have a disability.

Despite the challenges posed by such a diverse student body, we are determined to eliminate barriers to tauira success and boost achievement for Māori and Pasifika tauira. Our fees free policy for the majority of sub-degree qualifications is the key component of maintaining accessibility for tauira who would not normally have the financial means to undertake tertiary studies. As a major provider of foundation education we aim to give tauira without prior qualifications the confidence to achieve higher levels of qualification. Our part time and home-based learning programmes provide tauira with the ability to upskill without interrupting employment or other responsibilities. We also take pride in a values-based learner experience that connects all tauira with their identity so they can succeed in cultural, social and economic contexts. Equal Employment Opportunities Te Wānanga o Aotearoa is also committed to equal opportunities for our kaimahi. In 2018 there were 1,798 full and part-time kaimahi, of this 66% were female and 62% Māori. Family-friendly working environments, and cultural leave are just some of the initiatives that we provide as we seek to ‘walk the talk’ through values-based employment policies and practices.

Te PÅ«rongo 2018

Te Wānanga o Aotearoa

FINANCIALS

Annual Report 2018

Tauaki Haepapa Statement of Responsibility

Te Pūrongo a te kaitātari kaute motuhake Independent Auditor's Report

Tauaki whiwhinga moni me te utu matawhānui Statement of comprehensive revenue and expense

Tauaki nekehanga rawa Statement of changes in net assets/equity

Tauaki tūnga pūtea Statement of financial position

Tauaki kapewhiti Statement of cash flows

Ngā whakamārama ki ngā tauaki pūtea Notes to the financial statements

Te Wānanga o Aotearoa

Tauaki Haepapa Statement of Responsibility In the financial year ended 31 December 2018, Te Mana Whakahaere (the Council) and the management of Te Wānanga o Aotearoa were responsible for: ›› preparation of the annual financial statements and statement of service performance and the judgements used in them; and ›› establishing and maintaining a system of internal control designed to provide reasonable assurance as to the integrity and reliability of financial reporting and non financial reporting. In the opinion of Te Mana Whakahaere and management of Te Wānanga o Aotearoa, the financial statements and statement of service performance fairly reflect the financial position and operations of Te Wānanga o Aotearoa for the year ended 31 December 2018.

30 | 04 | 19 Vanessa Eparaima MNZM, Heamana | Chairperson

30 | 04 | 19 Hon. Te Ururoa Flavell, Te Taiurungi | Chief Executive

Te Pūrongo 2018

Te Pūrongo a te kaitātari kaute motuhake Independent Auditor's Report To the readers of Te Wānanga o Aotearoa Te Kuratini o Ngā Waka and group’s financial statements and statement of service performance for the year ended 31 December 2018

The Auditor-General is the auditor of Te Wānanga o Aotearoa Te Kuratini o Ngā Waka (Te Wānanga o Aotearoa) and group. The Auditor-General has appointed me, Clarence Susan, using the staff and resources of Audit New Zealand, to carry out the audit of the financial statements and statement of service performance of the Te Wānanga o Aotearoa and group on his behalf.

In our opinion: ››

Our audit was completed on 30 April 2019. This is the date at which our opinion is expressed.

the financial statements of Te Wānanga o Aotearoa and group The basis for our opinion is explained on pages 76 to 130: below. In addition, we outline the responsibilities of the Council and ›› present fairly, in all material our responsibilities relating to the respects: financial statements and the statement of service performance, we comment ›› the financial position on other information, and we explain as at 31 December our independence. 2018; and

Opinion ›› We have audited: ››

››

the financial statements of the Te Wānanga o Aotearoa and group on pages 76 to 130, that comprise the statement of financial position as at 31 December 2018, the statement of comprehensive revenue and expense, statement of changes in equity and statement of cash flows for the year ended on that date and the notes to the financial statements that include accounting policies and other explanatory information; and the statement of service performance of the Te Wānanga o Aotearoa and group on pages 44 to 68.

››

the financial performance and cash flows for the year then ended; and

Basis for our opinion

We carried out our audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the Professional and Ethical Standards ›› comply with generally accepted accounting practice and the International Standards on in New Zealand in accordance Auditing (New Zealand) issued by the New Zealand Auditing and Assurance with Public Benefit Entity Standards Board. Our responsibilities Reporting Standards; and under those standards are further described in the Responsibilities of the the statement of service auditor section of our report. performance of the Te Wānanga o Aotearoa and group on pages 44 to 68 presents fairly, in all material We have fulfilled our responsibilities in accordance with the Auditorrespects, the Te Wānanga o General’s Auditing Standards. Aotearoa and group’s service performance achievements We believe that the audit evidence measured against the proposed we have obtained is sufficient and outcomes described in the investment plan for the year ended appropriate to provide a basis for our opinion. 31 December 2018. 73

Te Wānanga o Aotearoa

Responsibilities of the Council for the financial statements and the statement of service performance The Council is responsible on behalf of the Te Wānanga o Aotearoa and group for preparing financial statements that are fairly presented and that comply with generally accepted accounting practice in New Zealand. The Council is also responsible on behalf of the Te Wānanga o Aotearoa and group for preparing a statement of service performance that is fairly presented. The Council is responsible for such internal control as it determines is necessary to enable it to prepare financial statements and a statement of service performance that are free from material misstatement, whether due to fraud or error. In preparing the financial statements and the statement of service performance, the Council is responsible on behalf of the Te Wānanga o Aotearoa and group for assessing the Te Wānanga o Aotearoa and group’s ability to continue as a going concern. The Council is also responsible for disclosing, as applicable, matters related to going concern and using the going concern basis of accounting, unless the Council intends to liquidate the Te Wānanga o Aotearoa and group or to cease operations, or has no realistic alternative but to do so. The Council’s responsibilities arise from the Crown Entities Act 2004 and the Education Act 1989.

Responsibilities of the auditor for the audit of the financial statements and the statement of service performance Our objectives are to obtain reasonable assurance about whether the financial statements and the statement of service performance, as a whole, are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit carried out in accordance with the Auditor-General’s Auditing Standards will always detect a material misstatement when it exists. Misstatements are differences or omissions of amounts or disclosures, and can arise from fraud or error. Misstatements are considered material if, individually or in the aggregate, they could reasonably be expected to influence the decisions of readers taken on the basis of these financial statements and statement of service performance. For the budget information reported in the financial statements and the statement of service performance, our procedures were limited to checking that the information agreed to the Te Wānanga o Aotearoa and group’s investment plan and approved budget. We did not evaluate the security and controls over the electronic publication of the financial statements and the statement of service performance.

As part of an audit in accordance with the Auditor-General’s Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. Also: ›› We identify and assess the risks of material misstatement of the financial statements and the statement of service performance, 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 our 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. ››

We 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 Te Wānanga o Aotearoa and group’s internal control.

››

We evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Council.

››

We conclude on the appropriateness of the use of the going concern basis of accounting by the Council and, based on the audit evidence obtained, whether a material uncertainty exists

Annual Report 2018

related to events or conditions that may cast significant doubt on the Te Wānanga o Aotearoa and group’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements and the statement of service performance or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the Te Wānanga o Aotearoa and group to cease to continue as a going concern. ››

››

We evaluate the overall presentation, structure and content of the financial statements and the statement of service performance, including the disclosures, and whether the financial statements and the statement of service performance represent the underlying transactions and events in a manner that achieves fair presentation. We obtain sufficient appropriate audit evidence regarding the financial statements and the statement of service performance of the entities or business activities within the group to express an opinion on the consolidated financial statements and the consolidated statement of service performance. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.

We communicate with the Council regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Our responsibilities arise from the Public Audit Act 2001. Other information The Council is responsible for the other information. The other information comprises the information included on pages 1 to 41 but does not include the financial statements and the statement of service performance, and our auditor’s report thereon.

Independence We are independent of the Te Wānanga o Aotearoa and group in accordance with the independence requirements of the Auditor-General’s Auditing Standards, which incorporate the independence requirements of Professional and Ethical Standard 1 (Revised): Code of Ethics for Assurance Practitioners issued by the New Zealand Auditing and Assurance Standards Board. Other than the audit, we have no relationship with or interests in the Te Wānanga o Aotearoa or any of its subsidiaries.

Our opinion on the financial statements and the statement of service performance does not cover the other information and we do not express any form of audit opinion or assurance conclusion thereon. In connection with our audit of the financial statements and the statement of service performance, our responsibility is to read the other information. In doing so, we consider whether the other information is materially inconsistent with the financial statements and the statement of service performance or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If, based on our work, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Clarence Susan Audit New Zealand On behalf of the Auditor-General Tauranga, New Zealand

Te Wānanga o Aotearoa

Statement of comprehensive revenue and expense For the year ended 31 December 2018

Note

Actual 2018 $'000

Group Budget 2018 $'000

Actual 2017 $'000

Actual 2018 $'000

Parent Budget 2018 $'000

Actual 2017 $'000

Government funding

127,671

136,972

134,990

127,671

136,972

134,990

Tauira fees

4,421

5,138

6,100

3,902

4,887

4,734

Interest revenue

2,969

3,212

2,813

2,892

3,135

2,746

Other revenue

12,600

12,028

12,766

15,206

14,547

15,522

147,661

157,350

156,669

149,671

159,541

157,992

(90,660)

(94,622)

(89,260)

(86,569)

(90,636)

(84,879)

13,14

(11,236)

(11,931)

(10,660)

(11,022)

(11,741)

(10,463)

(50,686)

(54,211)

(53,586)

(57,108)

(60,623)

(59,490)

(152,582)

(160,764)

(153,506)

(154,699)

(163,000)

(154,832)

(4,921)

(3,414)

3,163

(5,028)

(3,459)

3,160

Gains/(loss) on property revaluations

15,761

–

15,761

–

Total other comprehensive income

15,761

–

15,761

–

Total comprehensive income

10,840

(3,414)

3,163

10,733

(3,459)

3,160

Revenue

Total income

Expenditure Kaimahi costs Depreciation and amortisation expense Other expenses Total expenses Surplus/(deficit) for the year

Other comprehensive revenue and expense

Explanations of major variances against budget are provided in note 24. The accompanying notes form an integrated part of these financial statements.

Te Pūrongo 2018

Statement of changes in net assets / equity For the year ended 31 December 2018

Group Balance as at 1 January 2017

Note

ActualAccumulated Comprehensive Revenue and Expense $'000

Actual property revaluation reserves $'000

Actual total net assets/equity $'000

Budget $'000

156,794

18,684

175,478

164,653

3,163

–

3,163

4,820

–

159,957

18,684

178,641

169,473

159,957

18,684

178,641

177,150

(4,921)

15,761

10,840

(3,414)

Total comprehensive revenue and expense for the year Total transactions with owners of the entity Balance at 31 December 2017

– 15

Group Balance as at 1 January 2018 Total comprehensive revenue and expense for the year Transactions with owners of the controlling entity in their capacity as owners Reversal of revaluation charge to equity

–

128

–

Total transactions with owners of the entity

–

128

–

Balance at 31 December 2018

155,036

34,574

189,610

173,736

154,830

18,684

173,514

162,679

3,160

4,743

Parent Balance as at 1 January 2017 Total comprehensive revenue and expense for the year

3,160

Total transactions with owners of the entity Balance at 31 December 2017

– 15

– –

–

157,990

18,684

176,674

167,422

157,990

18,684

176,674

173,599

(5,028)

15,761

10,733

(3,459)

Parent Balance as at 1 January 2018 Total comprehensive revenue and expense for the year Transactions with owners of the controlling entity in their capacity as owners Reversal of revaluation charge to equity

–

128

–

Total transactions with owners of the entity

–

128

–

Balance at 31 December 2018

152,962

34,574

187,536

170,140

The accompanying notes form an integrated part of these financial statements.

Te Wānanga o Aotearoa

Statement of financial position For the year ended 31 December 2018

Note

Actual 2018 $'000

Group Budget 2018 $'000

Actual 2017 $'000

Actual 2018 $'000

Parent Budget 2018 $'000

Actual 2017 $'000

Cash and cash equivalents

10,089

5,716

5,828

9,770

4,524

5,445

Tauira and other receivables

10,666

16,900

14,151

10,655

15,366

14,111

Other financial assets

67,165

17,000

69,085

65,000

14,830

67,000

Inventories

2,195

1,903

2,083

2,193

1,897

2,081

ASSETS Current assets

–

20,000

–

20,000

–

815

459

730

788

454

638

90,930

61,978

91,877

88,406

57,071

89,275

Funds Management Prepayments Total current assets Non-current assets Property, plant and equipment

105,003

92,324

93,184

104,771

92,300

92,946

Intangible assets

9,759

12,388

11,435

9,507

12,085

11,091

–

20,544

–

20,544

–

475

–

475

Total non-current assets

114,762

125,256

104,619

114,753

124,929

104,512

Total assets

205,692

187,234

196,496

203,159

182,000

193,787

7,726

3,640

9,444

7,713

2,736

9,619

–

419

–

Funds Management Shares in subsidiaries

LIABILITIES Current liabilities Payables

Tauira fees Kaimahi entitlements

7,603

9,509

7,574

7,294

8,864

7,158

Provisions

155

Revenue in advance Total current liabilities

171

–

171

–

15,655

13,247

17,525

15,208

11,678

16,855 258

Non-current liabilities Provisions

427

114

330

415

137

Payables

–

137

–

427

251

330

415

183

258

16,082

13,498

17,855

15,623

11,861

17,113

189,610

173,736

178,641

187,536

170,139

176,674

155,036

155,052

159,957

152,962

151,456

157,990

Total non-current liabilities Total liabilities Net assets Equity Accumulated funds

Property revaluation reserve

Total equity

34,574

18,684

34,574

18,684

189,610

173,736

178,641

187,536

170,140

176,674

Explanations of major variances against budget are provided in note 24. The accompanying notes form an integrated part of these financial statements.

For and on behalf of Te Mana Whakahaere:

30 | 04 | 19 Vanessa Eparaima MNZM, Heamana | Chairperson

30 | 04 | 19 Hon. Te Ururoa Flavell, Te Taiurungi | Chief Executive

Annual Report 2018

Statement of cash flows For the year ended 31 December 2018

Actual 2018 $'000

Group Budget 2018 $'000

Actual 2017 $'000

Actual 2018 $'000

Parent Budget 2018 $'000

Actual 2017 $'000

130,622

134,767

135,357

130,622

134,767

135,357

3,920

5,326

6,483

3,820

5,074

4,969

Receipt from intercompany

–

2,800

–

3,500

Payment to intercompany

–

(9,363)

(6,850)

(9,353)

3,209

2,655

2,908

3,109

2,558

2,842

–

12,276

13,016

13,117

12,097

12,935

12,377

Payments to kaimahi

(91,764)

(108,210)

(92,121)

(87,557)

(105,402)

(87,859)

Payments to suppliers

(50,835)

(52,009)

(52,606)

(48,172)

(48,695)

(49,137)

GST (net)

(278)

–

(316)

(302)

–

194

Net cash flow from operating activites

7,155

(4,455)

12,826

7,057

(5,613)

12,893

267

–

439

238

–

435

(4,636)

(8,528)

(5,921)

(4,532)

(8,460)

(5,884)

Purchase of software development

(343)

(1,599)

(721)

(323)

(1,589)

(706)

Purchase of programme development

(102)

(935)

(1,686)

(115)

(900)

(1,655)

Purchase of investments (Net)

1,920

16,585

(8,035)

2,000

16,670

(8,000)

Net cash flow from investing activities

(2,894)

5,523

(15,924)

(2,732)

5,721

(15,810)

Net (decrease)/increase in cash and cash equivalents

4,261

1,068

(3,098)

4,325

108

(2,917)

Cash and cash equivalents at beginning of year

5,828

4,648

8,926

5,445

4,415

8,362

10,089

5,716

5,828

9,770

4,523

5,445

Note

Cash flows from operating activities Receipts from government grants Receipts from tauira fees

Interest revenue received Dividends revenue

Other cash receipts from operating activities

Cash flows from investing activities Sale of property, plant and equipment Purchase of property, plant and equipment

Cash and cash equivalents at end of year

Explanations of major variances against budget are provided in note 24. The accompanying notes form an integrated part of these financial statements.

Te Wānanga o Aotearoa

Statement of cash flows continued For the year ended 31 December 2018

Reconciliation of net surplus/(deficit) after tax to net cash flow from operating activities Group Actual 2018 $'000

Group Actual 2017 $'000

Parent Actual 2018 $'000

Parent Actual 2017 $'000

(4,921)

3,163

(5,028)

3,160

11,241

10,657

11,022

10,462

Asset impairment

243

401

238

401

Artwork revaluation

(74)

–

(74)

–

Provisions/(provision reversal)

165

124

110

111

–

11,661

11,182

11,382

10,974

(265)

(261)

(1,070)

(3,128)

(1,051)

(3,128)

(1,059)

(3,393)

(1,018)

(3,389)

(Increase)/decrease in inventories

(111)

(169)

(111)

(173)

(Increase)/decrease in tauira and other receivables

3,162

487

3,154

503

(Increase)/decrease in prepayments

(89)

(2)

(152)

(Increase)/decrease in interest accrued

240

217

Increase/(decrease) in payables

(931)

941

(1,112)

963

Increase/(decrease) in net GST

(278)

(316)

(302)

194

Increase/(decrease) in revenue received in advance

(298)

300

(278)

280

Increase/(decrease) in tauira fees

(419)

148

–

390

134

264

171

Net movement in working capital

1,474

1,874

1,721

2,148

Net cash inflow(outflow) from operating activities

7,155

12,826

7,057

12,893

Note

Surplus/(deficit) after tax Add/(less) non-cash movements Depreciation and amortisation expense

Impairment/(impairment reversal) of receivables Total non-cash items

13,14

Add/(deduct) items classified as investing or financing activities Net (gain) on disposal of property, plant and equipment Capitalisation of labour Total items classified as investing or financing activities Add/(less) movements in working capital items

Increase/(decrease) in provision for kaimahi entitlements Increase/(decrease) in fees free income received in advance

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

1. Statement of accounting policies for the year ended 31 December 2018 1.1 Reporting entity Te Wānanga o Aotearoa is a Tertiary Education Institution domiciled in New Zealand and is governed by the Crown Entities Act 2004 and the Education Act 1989. The primary purpose of Te Wānanga o Aotearoa is to provide tertiary education and it has designated itself as a public sector public benefit entity for the purposes of financial reporting. The Group consists of the ultimate Parent, Te Wānanga o Aotearoa, and its subsidiaries, DynaSpeak Limited (100% owned) and Aotearoa Scholarship Trust (100% controlled). The subsidiaries are incorporated and domiciled in New Zealand. The financial statements cover all of the activities pertaining to an educational and research institution including but not limited to: › The provision of student services and the facilitating of student activities, including scholarships; › The activities of a researcher, developer, publisher, property owner, occupier including tenant or landlord, trustee, provider of accommodation, early childhood services, conferences, exhibitions, recreation facilities, sponsorship and hireage; and › Any other activity or occupation incidental to an educational and research institution.

The financial statements of Te Wānanga o Aotearoa and group are for the year ended 31 December 2018. The financial statements were authorised for issue on 30 April 2019 by Te Mana Whakahaere.

Measurement base The financial statements have been prepared on a historical cost basis except where modified by the revaluation of artwork, land and buildings.

2. Summary of significant accounting policies

Functional and presentation currency The financial statements are presented in New Zealand dollars and all values are rounded to the nearest thousand dollars ($'000).

The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. These policies have been consistently applied to the opening statements of financial position and reporting period to 31 December 2018, unless otherwise stated. 2.1 Basis of preparation The financial statements have been prepared on the going concern basis, and the accounting policies have been applied consistently throughout the period. Statement of compliance The financial statements comply with Public Benefit Entity International Public Sector Accounting Standards ("PBE IPSAS") for Tier 1 entities. The financial statements of the Te Wānanga o Aotearoa and group have been prepared in accordance with the requirements of the Crown Entities Act 2004 and the Education Act 1989, which includes the requirement to comply with New Zealand Generally Accepted Accounting Practice ("NZ GAAP"). They comply with PBE IPSAS and other applicable Financial Reporting Standards, as appropriate for Tier 1 public sector public benefit entities.

The functional currency of Te Wānanga o Aotearoa and its subsidiaries is New Zealand dollars. There has been no change in the functional currency of the Group during the year. Changes in accounting policies These accounting policies have been consistently applied in the periods covered by these financial statements. Standards, amendments, and interpretations issued that are not yet effective and have not been early adopted Standards, amendments, and interpretations issued but not yet effective that have not been early adopted, and which are relevant to Te Wānanga o Aotearoa and Group, are: › Impairment of Revalued Assets In April 2017, the XRB issued Impairment of Revalued Assets, which now scopes in revalued property, plant and equipment into the impairment accounting standards. Previously, only property, plant and equipment assets measured at cost were scoped into the impairment accounting standards. The new standard is effective for financial statements covering periods beginning on or after 1 January 2019, with early application permitted.

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

Te Wānanga o Aotearoa plans to apply this new standard for annual periods beginning on 1 January 2019.

Te Wānanga o Aotearoa plans to apply this standard in preparing its 31 December 2019 financial statements.

› Financial instruments

›

PBE IFRS 9 replaces PBE IPSAS 29 Financial Instruments: Recognition and Measurement. PBE IFRS 9 is effective for annual periods beginning on or after 1 January 2021, with early application permitted. The main changes under PBE IFRS 9 are:

PBE FRS 48 replaces the service performance reporting requirements of PBE IPSAS 1 and is effective for annual periods beginning on or after 1 January 2021. Te Wānanga o Aotearoa is required to prepare its performance information in accordance with generally accepted accounting practice (GAAP) from 31 December 2019 year-ends. Te Wānanga o Aotearoa is considering whether it will early adopt PBE FRS 48 for the 31 December 2019 year end rather than apply the existing performance information requirements of PBE IPSAS 1. Te Wānanga o Aotearoa has not yet determined how application of PBE FRS 48 will affect its statement of service performance.

›

New financial asset classification requirements for determining whether an asset is measured at fair value or amortised cost.

›

A new impairment model for financial assets based on expected losses, which may result in the earlier recognition of impairment losses.

The Financial Statements of the Government will early adopt PBE IFRS 9 for the 30 June 2019 financial year. Te Wānanga o Aotearoa intends to early adopt PBE IFRS 9 for the 31 December 2019 financial year to be consistent with the Crown’s accounting policies for financial instruments. Te Wānanga o Aotearoa has not yet assessed in detail the impact of the new standard. ›

Separate Financial Statements

PBE IPSAS 34 - 38 replace the existing standards for interests in other entities (PBE IPSAS 6 - 8). The new standards are effective for annual periods beginning on or after 1 January 2019. Te Wānanga o Aotearoa will apply these new standards in preparing the 31 December 2019 financial statements. Te Wānanga o Aotearoa and group has not yet assessed the impact of the new standards.

›

Service Performance Reporting

Cash flow statements

An amendment to PBE IPSAS 2 Statement of Cash Flows requires entities to provide disclosures that enable users of financial statements to evaluate changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes. This amendment is effective for annual periods beginning on or after 1 January 2021, with early application permitted. Te Wānanga o Aotearoa does not intend to early adopt the amendment. 2.2 Basis of consolidation The consolidated financial statements are prepared by adding together like items of assets, liabilities, equity, revenues, expenses and cashflows on a line by line basis. All significant intra-group balances, transactions, revenue and expenses are eliminated in full on consolidation.

Subsidiaries Te Wānanga o Aotearoa consolidates in the group financial statements all entities where Te Wānanga o Aotearoa has the capacity to control their financing and operating policies so as to obtain benefits from the activities of those entities. This power exists where Te Wānanga o Aotearoa controls the majority voting power on the governing body or where such policies have been irreversibly predetermined by Te Wānanga o Aotearoa or where the determination of such policies is unable to materially impact the level of potential ownership benefits that arise from the activities of the subsidiary. Investments in subsidiaries are carried at cost in the Parent entity financial statements of Te Wānanga o Aotearoa. 2.3 Goods and Services Tax (GST) All items in the financial statements are stated exclusive of GST, except for receivables and payables, which are presented on a GST inclusive basis. Where GST is not recoverable as input tax, it is recognised as part of the related asset or expense. The net amount of GST recoverable from or payable to the Inland Revenue (IRD) is included as part of receivables or payables in the statement of financial position. The net GST paid to or received from the IRD, including the GST relating to investing and financing activities, is classified as an operating cash flow in the statement of cash flows. Commitments and contingencies are disclosed exclusive of GST.

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

2.4 Cost allocation The cost of service for each significant activity of Te Wānanga o Aotearoa and the Group has been derived using the cost allocation outlined below. Direct costs are those costs directly attributable to a significant activity. Indirect costs are those costs that cannot be identified in an economically feasible manner with a specific activity. Direct costs are charged directly to the significant activity. Indirect costs are charged to significant activities using the appropriate cost drivers. 2.5 Key judgements, estimates and assumptions The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, revenue and expenses. Actual results may differ from those estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. The following items have been included in the financial statements as a result of key judgements or estimates: Distinction between revenue and capital contribution: Most Crown funding received is operational in nature. Thus it is provided by the Crown under the authority of an expense appropriation and is recognised as revenue. Where funding is received from the Crown under the authority of a capital appropriation, Te Wānanga o Aotearoa accounts for the funding as a capital contribution directly in accumulated funds.

"Revenue is recognised when the amount of revenue can be measured reliably and it is probable that economic benefits will flow to Te Wānanga o Aotearoa and is measured at the fair value of consideration received or receivable."

Estimation of useful lives of assets: The estimation of the useful lives of assets has been based on historical experience as well as the manufacturers' warranties (for plant and equipment), lease terms (for leased equipment) and turnover policies (for motor vehicles). In addition, the condition of each asset is assessed at least once per year and considered against the remaining useful life. Adjustments to useful lives are made when considered necessary. Property revaluations: Note 13 provides information about the estimates and assumptions exercised in the measurement of revalued land and buildings. 3. Revenue Accounting policy Revenue classification Te Wānanga o Aotearoa classifies its revenue as exchange and non-exchange transactions. Exchange transactions are transactions in which one entity receives assets or services, or has liabilities extinguished, and directly gives approximately equal value (primarily in the form of cash, goods, services, or use of assets) to another entity in exchange. Non-exchange transactions are those where

Te Wānanga o Aotearoa either receives value from another entity without directly giving approximately equal value in exchange, or gives value to another entity without directly receiving approximately equal value in exchange. Revenue recognition Revenue is recognised when the amount of revenue can be measured reliably and it is probable that economic benefits will flow to Te Wānanga o Aotearoa and is measured at the fair value of consideration received or receivable. Revenue from exchange transactions The following specific recognition criteria in relation to the parent and group's revenue streams must also be met before revenue is recognised. Rental revenue Rental revenue is recognised in the surplus or deficit on an accrual basis. Interest revenue Interest revenue is recognised on a time proportion basis that takes into account the effective yield on the asset. Contract revenue Certain contract revenue is accounted for as an exchange transaction and is recognised on percentage of completion basis. 83

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

3. Revenue (continued) International tauira tuition fees International tauira tuition fees are accounted for as an exchange transaction and recognised in revenue on course percentage of completion basis. The percentage of completion is measured by the reference to the days of the course completed as a proportion of the total course days. Revenue from non-exchange transactions Inflows of resources from non-exchange transactions are only recognised as assets where it is probable that the associated future economic benefit or service potential will flow to the entity and fair value is reliably measured. Liabilities are recognised in relation to inflows of resources from non-exchange transactions when there is a resulting present obligation as a result of the non-exchange transactions where it is probable that an outflow of resources embodying future economic benefit or service potential will be required to settle the obligation and the amount of the obligation can be reliably estimated. The following specific recognition criteria in relation to the parent and group's non-exchange transaction revenue streams must also be met before revenue is recognised. Student Achievement Component Funding (SAC) SAC funding is Te Wānanga o Aotearoa's main source of operational funding from the Tertiary Education Commission (TEC). Te Wānanga o Aotearoa considers SAC funding to be non-exchange and recognises SAC funding as revenue when the

course withdrawal date has passed, based on the number of eligible students enrolled in the course at that date and the value of the course. Other government grants Funding is received from the TEC in relation to costs expected to be incurred by Te Wānanga o Aotearoa to complete specific projects agreed between the TEC and Te Wānanga o Aotearoa. Other grants are recognised as revenue when they become receivable unless there is an obligation in substance to return the funds if conditions of the grant are not met. If there is such an obligation, the grants are initially recorded as grants received in advance and then recognised as revenue when the conditions of the grant are satisfied. Domestic tauira tuition fees Domestic tauira tuition fees are subsidised by government funding and are considered non-exchange. Revenue is recognised when the course withdrawal date has passed, which is when a student is no longer entitled to a refund for withdrawing from the course. Research and contract revenue For a non-exchange research contract, the total funding receivable under the contract is recognised as revenue immediately, unless there are substantive conditions in the contract. If there are substantive conditions, revenue is recognised when the conditions are satisfied. A condition could include the requirement to complete research to the satisfaction of the funder to retain funding or return unspent funds. Revenue for future periods is not recognised where the contract contains substantive

termination provisions for failure to comply with the requirements of the contract. Conditions and termination provisions need to be substantive, which is assessed by considering factors such as contract monitoring mechanisms of the funder and the past practice of the funder. Contract revenue Certain contract revenue is accounted for as a non-exchange transaction and is recognised as revenue immediately based on hours of delivery each month, unless there are substantive conditions in the contract. If there are substantive conditions, revenue is recognised when the conditions are satisfied.

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

126,054

133,358

126,054

133,358

Government funding Student Achievement Component funding Other government funding

1,617

1,632

1,617

1,632

127,671

134,990

127,671

134,990

3,902

4,734

3,902

4,734

519

1,366

–

Total tauira fees

4,421

6,100

3,902

4,734

Interest revenue

2,969

2,813

2,892

2,746

Total interest revenue

2,969

2,813

2,892

2,746

7,092

7,117

7,092

6,916

270

265

270

261

–

Donation from DynaSpeak Limited

–

2,800

3,500

Dividends from external sources

5,159

5,380

4,967

4,842

12,600

12,766

15,206

15,522

147,661

156,669

149,671

157,992

Total government funding Tauira fees Fees from domestic tauira Fees from international tauira

Other revenue Contract revenue* Profit on sale of property, plant, equipment Artwork revaluation gain

Miscellaneous revenue Total other revenue Total revenue

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

3. Revenue (continued) Revenue classified as exchange or non-exchange transactions Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

519

1,366

–

3,575

3,603

3,575

3,402

270

265

270

261

2,969

2,813

2,892

2,746

851

1,121

684

583

8,189

9,172

7,424

6,995

126,054

133,358

126,054

133,358

Other government funding

1,617

1,632

1,617

1,632

Fees from domestic tauira

3,902

4,734

3,902

4,734

–

2,800

3,500

Miscellaneous revenue

4,308

4,259

4,283

4,259

Contract revenue

3,517

3,514

3,517

3,514

Total revenue from non-exchange transactions

139,472

147,497

142,247

150,997

Total exchange and non-exchange

147,661

156,669

149,671

157,992

Revenue from exchange transactions Fees from international tauira Contract revenue* Profit on sale of property, plant and equipment Interest revenue Dividends from external sources Miscellaneous revenue Total revenue from exchange transactions

Revenue from non-exchange transactions Student Achievement Component funding

Artwork revaluation gain Donation from DynaSpeak Limited

* Contract revenue relates to licences and subcontracting arrangements.

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

4. Kaimahi costs Accounting Policy Superannuation Schemes Employer contributions to Kiwisaver are accounted for as defined contribution schemes and are recognised as an expense in the surplus or deficit when incurred.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

89,751

90,663

85,652

86,467

1,920

1,886

1,822

1,800

(161)

146

(260)

Capitalised internal labour

(1,070)

(3,128)

(1,051)

(3,128)

Total kaimahi costs

90,660

89,260

86,569

84,879

Wages and salaries Employer contributions to defined contribution plans* Increase/(decrease) in employee entitlements

* Employer contributions to define contribution plans include contributions to KiwiSaver.

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

5. Other expenses Accounting policy Operating leases An operating lease is a lease that does not transfer substantially all the risk and rewards incidental to ownership of an asset to the lessee. Lease payments under an operating lease are recognised as an expense on a straight-line basis over the lease term. Lease incentives received are recognised in the surplus or deficit as a reduction of rental expense over the lease terms.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Audit fees for financial statements audit (Audit NZ)

241

223

234

217

Audit fees for internal audits (other service providers)

140

114

140

121

Administration

12,793

14,006

12,057

12,402

Contract tutors

7,957

7,327

7,957

7,327

Note

Fees to auditor

Impairment/(impairment reversal) of receivables

–

Bad debts written off

257

692

257

692

363

380

362

378

1,406

1,664

1,406

1,664

Intercompany expenses

–

9,023

9,236

Small capital purchases

479

487

445

476

Consultancy fees

2,664

2,223

2,649

2,205

Tauira resources

8,600

10,762

8,465

10,670

Travel

1,800

1,777

1,789

1,743

Occupancy expenses

6,728

6,783

6,427

6,503

Rent

2,277

2,178

925

886

Minimum lease payments – operating lease

4,178

4,299

4,178

4,299

Impairment of intangibles, inventory and PPE

406

641

406

641

Loss on sale/ disposal

311

302

Total other expenses

50,686

53,586

57,108

59,490

Sponsorship and koha Satellite payments

The fees paid to audit firms for internal audits were for planning and undertaking internal audits.

Te PĹŤrongo 2018

Notes to the financial statements For the year ended 31 December 2018

6. Cash and cash equivalents Accounting policy Cash and cash equivalents includes cash at bank and in hand, deposits held at call and short-term deposits with an original maturity of three months or less.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Cash at bank and in hand

10,089

5,828

9,770

5,445

Total cash and cash equivalents

10,089

5,828

9,770

5,445

The carrying value of cash and cash equivalents approximates their fair value. There are no restrictions over any of the cash and cash equivalent balances held by the Te WÄ nanga o Aotearoa and group at 31 December 2018 (2017: nil).

Te Wānanga o Aotearoa

"I’ve gained a lot of confidence in everything I do. Te Wānanga o Aotearoa helped me find where I belong in New Zealand" -Zia Nisha

Te Pūrongo 2018

Zia Nisha Graduate of He Korowai Ākonga Bachelor of Education (Primary Teaching)

Te WÄ nanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

7. Tauira and other receivables Accounting policy Tauira fees and other receivables are recognised and carried at original receivable amount less any provision for impairment. A specific provision for impairment is made when collection of the full amount is no longer probable. Bad debts are written off when identified.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

956

704

956

704

(235)

(149)

(235)

(149)

721

555

721

555

1,059

1,395

1,047

1,386

661

900

651

868

â&#x20AC;&#x201C;

8,225

11,301

8,225

11,301

9,945

13,596

9,934

13,556

10,666

14,151

10,655

14,111

821

1,037

810

1,006

9,845

13,114

9,845

13,105

10,666

14,151

10,655

14,111

Tauira receivables Tauira fee receivables Less: provision for impairment Net debtors Other receivables Trade receivables Accrued interest Related party receivables Subsidiary TEC funding receivable

Gross debtors and other receivables Total receivables above comprise: Receivables from exchange transactions Receivables from non-exchange transactions Total receivables

(a) Fair value Other receivables are non-interest bearing and receipt is normally on short term of 30-day terms. Therefore the carrying value of other receivables approximates their fair value. Tauira receivables are non-interest bearing and receipt is normally on enrolment and no later than graduation. Therefore the carrying value of tauira receivables approximates their fair value. (b) Impairment The carrying amount of receivables that would otherwise be past due or impaired and whose terms have been renegotiated is nil (2017: nil).

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

The ageing profile of receivables at year end is detailed below:

Gross 2018 $'000

Impairment 2018 $'000

Net 2018 $'000

Gross 2017 $'000

Impairment 2017 $'000

Net 2017 $'000

9,675

–

9,675

13,292

–

13,292

–

105

–

105

(17)

–

(17)

1,073

(235)

838

967

(149)

818

10,901

(235)

10,666

14,300

(149)

14,151

9,668

–

9,668

13,259

–

13,259

–

105

–

105

(17)

–

(17)

1,069

(235)

834

960

(149)

811

(235)

10,655

14,260

(149)

14,111

Group Not past due Past due 1-60 days Past due 61-120 days Past due > 120 days Total Parent Not past due Past due 1-60 days Past due 61-120 days Past due > 120 days Total

10,890

All receivables greater than 30 days in age are considered to be past due. The impairment provision has been calculated based on expected losses for Te Wānanga o Aotearoa and the pool of receivables. Expected losses have been determined based on an analysis of losses for Te Wānanga o Aotearoa in previous periods and a review of specific receivables. Other impaired receivables have been determined to be impaired because of the significant financial difficulties being experienced by the debtor. Movements in the provision for impairment of receivables are as follows:

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

At 1 January

149

Additional provisions made during the year

343

692

343

692

(257)

(692)

(257)

(692)

235

149

235

149

Receivables written off during the period At 31 December

Te Wānanga o Aotearoa and group holds no collateral as security as other credit enhancements over receivables that are either past due or impaired.

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

8. Inventory Accounting policy Inventories held for distribution or consumption in the provision of services that are not issued on a commercial basis are measured at the cost, adjusted for any loss of service potential. Inventories acquired through non-exchange transactions are measured at fair value at the date of acquisition. Inventories held for use in the provision of goods and services on a commercial basis are valued at the lower of cost and net realisable value. The cost of purchased inventory is determined as follows: ››

inventories held for resale – purchase cost is on a weighted average cost

››

materials and consumables to be utilised for rendering of services – purchase cost is on a first-in, first-out basis.

The amount of any write-down for the loss of service potential or from cost to net reliable value is recognised in the surplus or deficit in the period of the write-down.

Group 2018 $'000

Inventories held for distribution Work in progress Total inventory

1,974 221 2,195

Group 2017 $'000

1,907 176 2,083

Parent 2018 $'000

1,972 221 2,193

Parent 2017 $'000

1,905 176 2,081

Inventories are made up of consumables and inventories held for distribution to Takiwa. Consumables are materials or supplies which will be consumed in conjunction with the delivery of services and predominantly comprise of books and resources used in the teaching of courses to tauira. Inventory consumed for the group in 2018 is $3.3m (2017: $4.9m) and parent 2018 is $3.2m (2017: $4.8m). These figures form part of tauira resources which is disclosed in note 5, other expenses. The write down of inventories held for distribution due to tauira resources being revised and redeveloped amounted to $0.28m in 2018 (2017: $0.20m). There have been no reversals of write-downs in 2018 (2017: nil). No inventories are pledged as security for liabilities (2017: nil).

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

9. Other financial assets Accounting policy Financial assets are initially recognised at fair value plus transaction costs unless they are carried at fair value through surplus or deficit in which case the transaction costs are recognised in the surplus or deficit. Purchases and sales of financial assets are recognised on trade-date, the date on which the parent and group commits to purchase or sell the asset. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Parent and Group has transferred substantially all the risks and rewards of ownership. Financial assets are classified into the following categories for the purpose of measurement: ››

fair value through surplus or deficit;

››

loans and receivables; and

››

fair value through other comprehensive income.

The classification of a financial asset depends on the purpose for which the instrument was acquired. Financial assets at fair value through surplus or deficit Financial assets at fair value through surplus or deficit include financial assets held for trading. A financial asset is classified in this category if acquired principally for the purpose of selling in the short-term or is part of a portfolio that are managed together and for which there is evidence of short-term profit-taking. Financial assets acquired principally for the purpose of selling in the short-term or part of a portfolio classified as held for trading are classified as a current asset. After initial recognition, financial assets in this category are measured at their fair values with gains or losses on remeasurement recognised in the surplus or deficit. Loans and receivables (including cash and cash equivalents and tauira and other receivables) Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for maturities greater than 12 months after the balance date, which are included in non-current assets. After initial recognition, loans and receivables are measured at amortised cost, using the effective interest method, less impairment. Gains and losses when the asset is impaired or derecognised are recognised in the surplus or deficit. Fair value through other comprehensive revenue and expense Financial assets at fair value through other comprehensive revenue and expense are those that are designated into the category at initial recognition or are not classified in any of the other categories above. They are included in non-current assets unless management intends to dispose of, or realise, the investment within 12 months of balance date. Te Wānanga o Aotearoa and Group includes in this category: ››

investments that it intends to hold long-term but which may be realised before maturity; and

››

shareholdings that it holds for strategic purposes.

After initial recognition, these investments are measured at their fair value, with gains and losses recognised in other comprehensive revenue and expense, except for impairment losses, which are recognised in the surplus or deficit. On derecognition, the cumulative gain or loss previously recognised in other comprehensive revenue and expense is reclassified from equity to the surplus or deficit.

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

9. Other financial assets (continued) Impairment of financial assets At each balance date, Te Wānanga o Aotearoa assesses whether there is any objective evidence that a financial asset or group of financial assets is impaired. Any impairment losses are recognised in the surplus or deficit.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Term deposits with maturities <12 months

67,165

69,085

65,000

67,000

Total current portion

67,165

69,085

65,000

67,000

–

67,165

69,085

65,000

67,000

Current portion

Non-current portion Total non-current portion Total other financial assets

Fair value Term deposits The carrying amount of term deposits approximates their fair value. The weighted average effective interest rate for term deposits is 3.40% (2017: 3.64%). Impairment There were no impairment provisions for other financial assets. None of the financial assets are either past due or impaired.

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

10. Payables Accounting policy Short-term creditors and other payables are recorded at their face value.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Trade payables

2,358

2,575

2,147

2,406

Accrued expenses

1,890

2,464

1,886

2,397

300

280

4,250

5,339

4,035

5,083

–

284

625

864

990

864

990

Early childcare centre grant

–

Taxes payable (GST, PAYE)

2,612

3,099

2,530

2,905

Total

3,476

4,105

3,678

4,536

Total current portion

7,726

9,444

7,713

9,619

–

7,726

9,444

7,713

9,619

Note

Payables and deferred revenue under exchange transactions:

Revenue in advance Total Payables and deferred revenue under non-exchange transactions: Amounts due to related parties-DynaSpeak Limited

Other government funding

Total non-current portion Total payables and deferred revenue

Creditors and other payables are non-interest bearing and are normally settled on terms varying between 7 days and 20th of the month following invoice date. Therefore, the carrying value of trade and other payables approximates their fair value. Deferred non-exchange revenue relates to grants, donations received to which there are stipulated conditions attached. Non-exchange revenue in relation to this balance is recognised at the point-in-time as each stipulated condition is met. For terms and conditions relating to related parties payables, refer to note 19.

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

11. Kaimahi entitlements Accounting policy Short-term kaimahi entitlements Kaimahi entitlements that Te Wānanga o Aotearoa expects to be settled within 12 months of balance date are measured at nominal values based on accrued entitlements at current rates of pay. These include salaries and wages accrued up to balance date, annual leave earned, but not yet taken at balance date and sick leave. Te Wānanga o Aotearoa recognises a liability for sick leave to the extent that compensated absences in the coming year are expected to be greater than the sick leave entitlements earned in the coming year. The amount is calculated based on the unused sick leave entitlement that can be carried forward at balance date to the extent Te Wānanga o Aotearoa anticipates it will be used by staff to cover those future absences. Superannuation schemes Obligations for contributions to KiwiSaver are accounted for as defined contribution superannuation schemes and are recognised as an expense in the surplus or deficit when incurred.

Current portion

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Accrued salaries

2,107

2,135

2,033

2,041

Annual leave

5,065

5,084

4,838

4,770

431

355

423

347

7,603

7,574

7,294

7,158

–

7,603

7,574

7,294

7,158

Sick leave Total current portion

Non-current portion Total non-current portion Total kaimahi entitlements

Annual leave and sick leave entitlements expected to be settled within 12 months of the balance date are measured at the current rates of pay.

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

12. Provisions Accounting policy A provision is recognised for future expenditure of uncertain amount or timing when there is a present obligation (either legal or constructive) as a result of a past event; it is probable that an outflow of future economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Lease make-good The lease make-good provision is based on an estimate of future costs to restore leased premises back to the condition when the lease period commenced.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Current Portion Lease make-good

155

Total current portion

155

Lease make-good

427

330

415

258

Total non-current portion

427

330

415

258

Total lease make-good

582

418

445

336

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Balance at 1 January

418

304

336

225

Additional provisions

273

124

158

111

Unused amounts reversed

(109)

(10)

(49)

–

Balance at 31 December

582

418

445

336

Non-current portion

Movements for lease make-good provisions are as follows:

In respect of a number of leased premises, Te Wānanga o Aotearoa is required at the expiry of the lease term to makegood any fixtures or fittings installed in the premises. In many cases, Te Wānanga o Aotearoa has the option to renew these leases, which impacts on the timing of expected cash outflows to make-good the premises. The cash flows associated with the non-current portion of the lease make-good provision are expected to occur in January 2020, March 2020, April 2020, June 2020, November 2020, December 2020, January 2021, May 2022, July 2022, November 2024 and April 2026. Information about Te Wānanga o Aotearoa leasing arrangements are disclosed in note 22.

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

13. Property, plant and equipment Accounting policy Property, plant and equipment asset classes consist of land and buildings, leasehold improvements, furniture and equipment, computers, motor vehicles, waka, library books and artwork. Items of property, plant and equipment are initially measured at cost, except those acquired through non-exchange transactions which are instead measured at fair value as their deemed cost at initial recognition. Items of property, plant and equipment are subsequently measured under the following: ›› ››

Buildings are measured at cost or valuation less subsequent accumulated depreciation. Land and artwork are stated at cost or valuation and are not depreciated.

››

All other asset classes are stated at cost less accumulated depreciation and impairment losses.

››

Items of property, plant and equipment that have been acquired through non-exchange transactions are measured at fair value.

(i) Revaluation Land, buildings and artwork are revalued with sufficient regularity to ensure that the carrying amount does not differ materially from fair value and at least every three years. The carrying values of revalued classes are assessed annually to ensure that they do not differ materially from fair value. If there is evidence supporting a material difference, then the offcycle asset classes are revalued. Property, plant and equipment revaluation movements are accounted for on a class-of-asset basis. The net revaluation results are credited or debited to other comprehensive revenue and expense and are accumulated to an asset revaluation reserve in equity for that class of asset. Where this would result in a debit balance in the asset

100

revaluation reserve this balance is not recognised in other comprehensive revenue and expense but is recognised in the surplus or deficit. Any subsequent increase on revaluation that reverses a previous decrease in value recognised in the surplus or the deficit will be recognised first in the surplus or deficit up to the amount previously expensed, and then recognised in other comprehensive revenue and expense. (ii) Additions The cost of an item of property, plant and equipment is recognised as an asset if, and only if, it is probable that future economic benefits or service potential associated with the item will flow to Te Wānanga o Aotearoa and Group and the cost of the item can be measured reliably. Work in progress is recognised at cost less impairment and is not depreciated. In most instances, an item of property, plant and equipment is initially recognised at its cost. Where an asset is acquired through a non-exchange transaction, it is recognised at its fair value and as at the date of acquisition. (iii) Disposals Gains and losses on disposals are determined by comparing the proceeds with the carrying value of the asset. Gains and losses on disposals are recognised in the surplus or deficit. When revalued assets are sold, the amounts included in the revaluation reserve in respect of those assets are transferred to accumulated funds. (iv) Subsequent costs Costs incurred subsequent to initial acquisition are capitalised only when it is probable that future economic benefits or service potential associated with the item will flow to Te Wānanga o Aotearoa and the cost of the item can be measured reliably. The costs of day-to-day servicing of property, plant and equipment are recognised in the surplus or deficit as they are incurred.

Te PĹŤrongo 2018

Notes to the financial statements For the year ended 31 December 2018

(v) Depreciation Depreciation is provided on a straight-line basis on all property, plant and equipment (excluding land and artwork) at rates that will write off the cost (or valuation) of the assets to their estimated residual values over their useful lives. The useful lives and associated depreciation rates of major classes of assets have been estimated as follows:

Class of asset depreciated Buildings

Estimated useful life

Depreciation rates

1-50 years

2%-100%

Leasehold improvements

Expiry of lease including renewal periods

Furniture and equipment

2-19 years

5%-50%

2-5 years

20%-50%

2 years

50%

1-5 years

20%-100%

5-10 years

10% -20%

10 years

10%

Computers Virtual learning computers Motor vehicles Waka Library books

Leasehold improvements are depreciated over the non-cancellable period for which Te WÄ nanga o Aotearoa has contracted to lease the asset together with any further terms for which Te WÄ nanga o Aotearoa has the option to continue to lease the asset. The residual value and useful life of an asset is reviewed, and adjusted if applicable, at each financial year end. (v) Impairment Property, plant and equipment held at cost that have a finite useful life are reviewed for impairment at each balance date and whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. If an asset's carrying amount exceeds its recoverable amount, the asset is considered to be impaired and the carrying amount is written-down to the recoverable amount. The impairment loss is recognised in the surplus or deficit.

101

Te Wānanga o Aotearoa

13. Property, plant and equipment (continued)

Group 2018 Cost Balance as at 1 January 2018 Revaluation surplus Additions

Land $'000

Buildings $'000

Leasehold Improvements $'000

Furniture & Equipment $'000

27,415

55,183

7,534

4,638

4,618

(930)

–

1,119

1,022

Disposals

–

(26)

(186)

(33)

Reclassification

–

(599)

493

Reversal of revaluation charge in equity

–

128

–

Impairment charge recognised in profit and loss

–

32,033

54,747

8,991

5,654

Balance as at 31 December 2018 Accumulated depreciation Balance as at 1 January 2018

–

(8,187)

(3,546)

(2,438)

Revaluation

–

12,073

–

Disposals

–

160

–

Impairment charge recognised in profit and loss

–

Depreciation charge

–

(4,043)

(535)

(828)

Reclassifications

–

134

(117)

(29)

Balance as at 31 December 2018

–

(18)

(4,038)

(3,295)

Net book value at 1 January 2018

27,415

46,996

3,988

2,200

Net book value at 31 December 2018

32,033

54,729

4,953

2,359

Land $'000

Buildings $'000

Leasehold Improvements $'000

Furniture & Equipment $'000

27,415

55,183

7,173

4,328

4,618

(930)

–

Additions

–

1,119

1,011

883

Disposals

–

(26)

(173)

(33)

Reclassification

–

(599)

484

118

Reversal of revaluation charge in equity

–

128

–

Impairment charge recognised in profit and loss

–

32,033

54,747

8,623

5,296

Parent 2018 Cost Balance as at 1 January 2018 Revaluation

Balance as at 31 December 2018 Accumulated depreciation Balance as at 1 January 2018

–

(8,187)

(3,300)

(2,208)

Revaluation

–

12,073

–

Disposals

–

156

–

Impairment charge recognised in profit and loss

–

Depreciation charge

–

(4,043)

(506)

(779)

Reclassification

–

134

(117)

(41)

Balance as at 31 December 2018

–

(18)

(3,767)

(3,028)

Net book value 1 January 2018

27,415

46,996

3,873

2,120

Net book value at 31 December 2018

32,033

54,729

4,856

2,268

102

Annual Report 2018

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

2,326

6,469

9,373

3,588

3,238

718

967

121,449

–

3,765

–

1,067

656

3,169

8,179

–

(243)

(913)

(59)

–

(1,460)

(2,326)

2,346

–

(3,691)

(3,750)

–

128

–

(313)

–

(313)

–

9,639

9,116

3,675

2,962

736

445

127,998

(2,121)

(3,452)

(6,481)

–

(1,544)

(496)

–

(28,265)

–

12,073

–

243

832

–

1,240

–

209

–

209

–

(1,291)

(1,158)

–

(347)

(38)

–

(8,240)

2,121

(2,121)

–

(12)

–

(6,621)

(6,807)

–

(1,682)

(534)

–

(22,995)

205

3,017

2,892

3,588

1,694

222

967

93,184

–

3,018

2,309

3,675

1,280

202

445

105,003

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

2,326

6,253

9,281

3,588

3,233

718

967

120,465

–

3,765

–

1,067

656

3,169

8,029

–

(244)

(913)

(59)

–

(1,448)

(2,326)

2,326

–

(3,691)

(3,688)

–

128

–

(313)

–

(313)

–

9,402

9,024

3,675

2,957

736

445

126,938

(2,121)

(3,274)

(6,391)

–

(1,542)

(496)

–

(27,519)

–

12,073

–

243

832

–

1,236

–

202

–

202

–

(1,273)

(1,156)

–

(350)

(38)

–

(8,145)

2,121

(2,121)

–

(14)

–

(6,425)

(6,715)

–

(1,680)

(534)

–

(22,167)

205

2,979

2,890

3,588

1,691

222

967

92,946

–

2,977

2,309

3,675

1,277

202

445

104,771

103

Te Wānanga o Aotearoa

13. Property, plant and equipment (continued)

Group 2017 Land $'000

Buildings $'000

Leasehold Improvements $'000

Furniture & Equipment $'000

27,415

53,954

7,433

3,989

Additions

–

1,248

337

649

Disposals

–

(19)

(24)

–

Reclassification

–

Impairment charge recognised in profit and loss

–

(212)

–

27,415

55,183

7,534

4,638

Balance as at 1 January 2017

–

(4,025)

(3,117)

(1,790)

Disposals

–

Impairment charge recognised in profit and loss

–

Depreciation charge

–

(4,162)

(524)

(648)

Closing accumulated depreciation as at 31 December 2017

–

(8,187)

(3,546)

(2,438)

Net book value at 1 January 2017

27,415

49,929

4,316

2,199

Net book value at 31 December 2017

27,415

46,996

3,988

2,200

Land $'000

Buildings $'000

Leasehold Improvements $'000

Furniture & Equipment $'000

27,415

53,954

7,072

3,690

Cost Balance as at 1 January 2017

Closing cost as at 31 December 2017 Accumulated depreciation

Parent 2017 Cost Balance as at 1 January 2017 Additions

–

1,248

337

638

Disposals

–

(19)

(24)

–

Reclassification

–

Impairment charge recognised in profit and loss

–

(212)

–

55,183

7,173

4,328

(4,025)

(2,901)

(1,598)

Closing cost at 31 December 2017

27,415

Accumulated depreciation Balance as at 1 January 2017

–

Disposals

–

Impairment charge recognised in profit and loss

–

Depreciation charge

–

(4,162)

(494)

(610)

Closing accumulated depreciation at 31 December 2017

–

(8,187)

(3,300)

(2,208)

Net book value 1 January 2017

27,415

49,929

4,171

2,092

Net book value at 31 December 2017

27,415

46,996

3,873

2,120

104

Te Pūrongo 2018

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

2,092

4,552

10,370

3,548

7,311

839

528

122,031

234

1,917

578

–

4,295

9,364

–

(1,575)

–

(940)

(121)

–

(2,679)

–

(3,856)

–

(3,199)

–

(3,411)

2,326

6,469

9,373

3,588

3,238

718

967

121,449

(1,849)

(2,645)

(6,498)

–

(5,207)

(582)

–

(25,713)

–

1,523

–

940

121

–

2,584

–

3,131

–

3,226

(272)

(807)

(1,506)

–

(408)

(35)

–

(8,362)

(2,121)

(3,452)

(6,481)

–

(1,544)

(496)

–

(28,265)

243

1,907

3,872

3,548

2,104

257

528

96,318

205

3,017

2,892

3,588

1,694

222

967

93,184

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

2,092

4,363

10,263

3,548

7,306

839

528

121,070

234

1,890

578

–

4,295

9,325

–

(1,560)

–

(939)

(121)

–

(2,663)

–

(3,856)

–

(3,199)

–

(3,411)

2,326

6,253

9,281

3,588

3,233

718

967

120,465

(1,849)

(2,491)

(6,408)

–

(5,206)

(582)

–

(25,060)

–

1,507

–

940

120

–

2,567

–

3,131

–

3,226

(272)

(783)

(1,490)

–

(407)

(34)

–

(8,252)

(2,121)

(3,274)

(6,391)

–

(1,542)

(496)

–

(27,519)

243

1,872

3,855

3,548

2,100

257

528

96,010

205

2,979

2,890

3,588

1,691

222

967

92,946

105

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

13. Property, plant and equipment (continued) Valuation The most recent valuation of land and buildings were performed by independent valuers, Bayleys Valuation Services as at 31 December 2018. Land Land is valued at fair value using market-based evidence based on its highest and best use with reference to comparable land values. Buildings Specialised buildings (for example, campuses) are valued at fair value using depreciated replacement cost as no reliable market data is available for buildings designed for education delivery purposes. Depreciated replacement cost is determined using a number of significant assumptions. Significant assumptions include: ››

The replacement asset is based on the replacement with modern equivalent assets with adjustments where appropriate for obsolescence due to over design or surplus capacity.

››

The replacement cost is derived from recent construction contracts of similar assets and Property Institute of New Zealand cost information.

››

The remaining useful life of assets is estimated.

››

Straight-line depreciation has been applied in determining the depreciated replacement cost value of the asset.

Buildings were revalued at fair value using market based evidence. Market rates and capitalisation rates were applied to reflect market value. Artwork The most recent valuation of artwork was performed by an independent valuer, Erika Chamberlain of Antique and Art on 28 November 2018. The valuation was undertaken in accordance with PBE IPSAS 17 using fair value and is effective as at 31 December 2018. Determination of fair value has been made by: ››

Reference to observable prices in an active market. Where the market exists for the same or similar asset the market prices are deemed to be a fair value. The values ascribed in the valuation are primarily based on observable prices both in the primary retail market and secondary auction market.

››

If there is no active market, fair value is determined by other market based evidence adjudged by active and knowledgeable participants in the market.

Impairment No impairment losses (2017: $0.1m) have been recognised for leasehold improvements due to no longer being in our current property portfolio or the improvement no longer exists. Impairment losses of $0.1m (2017: $0.07m) have been recognised for library books due to no longer being in our current library collection. The impairment loss has been recognised in the statement of comprehensive revenue and expense in the line item "Other expenses". Work in progress The value of work in progress is disclosed at cost by class of asset as follows:

106

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Equipment

550

Computers

–

337

408

337

408

–

444

996

444

996

Class

Buildings Leasehold Improvements Total

Restrictions of title Under the Education Act 1989, Te Wānanga o Aotearoa is required to obtain consent from the Ministry of Education to dispose of land and buildings. Te Wānanga o Aotearoa does not have any: ››

Restrictions on title on property, plant and equipment.

››

Property, plant and equipment pledged as security for liabilities.

››

Compensation for items of property, plant and equipment that were impaired, lost or given up.

Leasing The net carrying amount of property, plant and equipment held under finance leases is nil (2017: nil).

107

Te WÄ nanga o Aotearoa

108

Te PÅ«rongo 2018

109

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

14. Intangible assets Accounting policy Intangible assets are initially recorded at cost except for: ››

Intangible assets acquired through non-exchange transactions (measured at fair value).

All of the group's intangible assets are subsequently measured in accordance with the cost model, being cost (or fair value for items acquired through non-exchange transactions) less accumulated amortisation and impairment. Computer software Computer software is separately acquired and capitalised at its cost as at the date of acquisition. After initial recognition, separately acquired intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses. Programme development costs Programme development costs relate to development of educational courses and are capitalised once accreditation has been received and when it is probable that future economic benefit arising from use of the intangible asset will flow to the group. Following initial recognition of programme development costs, the cost model is applied and the asset is carried at cost less accumulated amortisation and accumulated impairment losses. Amortisation A summary of policies applied to the group's intangible assets is as follows:

Class of intangible asset

Estimated useful life

Method used

Computer software

Finite – 5 years

Straight-line method

Programme development costs

Finite – 5 years

Straight-line method

The carrying value of an intangible asset with a finite life is amortised on a straight-line basis over its useful life. The amortisation period starts when the asset is available for use and ceases at the date that the asset is derecognised. The amortisation method for each class of intangible asset having a finite life is reviewed at the end of each financial year. If the expected useful life or expected pattern of consumption is different from the previous assessment, changes are made accordingly. The amortisation for each period is recognised in the surplus or deficit. The carrying value of each class of intangible asset is reviewed annually for indicators of impairment. Intangible assets are tested for impairment where an indicator of impairment exists. Gains or losses arising from derecognition of an intangible asset are measured as the difference between the net disposal proceeds and the carrying amount of the asset and are recognised in the surplus or deficit when the asset is derecognised. All other research and development costs are recognised as expenses in the surplus or deficit in the year in which they are incurred.

110

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

Impairment of intangible assets Intangible assets that have an indefinite useful life or are not yet available for use are not subject to amortisation and are tested annually for impairment. Assets that have a finite useful life are reviewed for indicators of impairment at each balance date. When an asset is found to be impaired, a recoverable amount is estimated. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. The value in use for cash-generating assets is the present value of expected future cash flows. If an asset's carrying amount exceeds its recoverable amount, the asset is impaired and the carrying amount is written down to the recoverable amount. The total impairment loss is recognised in the surplus or deficit. Value in use for non-cash-generating assets Non-cash-generating assets are those assets that are not held with the primary objective of generating a commercial return. For non-cash-generating assets, value in use is determined using an approach based on either a depreciated replacement cost approach, restoration cost approach, or a service units approach. The most appropriate approach used to measure value in use depends on the nature of the impairment and availability of information. Value in use for cash-generating assets Cash-generating assets are those assets that are held with the primary objective of generating a commercial return. Movements in the carrying value for each class of intangible asset are as follows:

Group 2018 Software $'000

Programme Development $'000

Work in Progress $'000

Total $'000

2,401

4,043

4,991

11,435

Additions

597

4,343

3,728

8,668

Disposals

(60)

–

(60)

Reclassification

(54)

(7,144)

(7,150)

–

(138)

–

(138)

(973)

(2,023)

–

(2,996)

1,911

6,273

1,575

9,759

5,880

14,088

1,575

21,543

(3,969)

(7,815)

–

(11,784)

1,911

6,273

1,575

9,759

Year ended 31 December 2018 Opening net book value

Impairment (net) Amortisation Closing net book value

At 31 December 2018 Cost Accumulated amortisation and impairment Net book value

111

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

14. Intangible assets (continued)

Group 2017 Software $'000

Programme Development $'000

Work in Progress $'000

Total $'000

Opening net book value

1,694

2,472

4,187

8,353

Additions

1,494

3,341

4,768

9,603

–

(3,964)

(34)

(225)

–

(259)

(753)

(1,545)

–

(2,298)

2,401

4,043

4,991

11,435

5,443

11,129

4,991

21,563

(3,042)

(7,086)

–

(10,128)

2,401

4,043

4,991

11,435

Year ended 31 December 2017

Reclassification Impairment (net) Amortisation Closing net book value

At 31 December 2017 Cost Accumulated amortisation and impairment Net book value

112

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

Parent 2018 Software $'000

Programme Development $'000

Work in Progress $'000

Total $'000

2,343

3,932

4,816

11,091

Additions

474

4,332

3,694

8,500

Disposals

(60)

–

(60)

Reclassification

(57)

–

(6,952)

(7,009)

–

(138)

–

(138)

Amortisation

(922)

(1,955)

–

(2,877)

Closing net book value

1,778

6,171

1,558

9,507

5,607

13,731

1,558

20,896

(3,829)

(7,560)

–

(11,389)

1,778

6,171

1,558

9,507

Software $'000

Programme Development $'000

Work in Progress $'000

Total $'000

Opening net book value

1,615

2,301

4,050

7,966

Additions

1,488

3,341

4,729

9,558

–

(3,963)

(34)

(225)

–

(259)

Amortisation

(726)

(1,485)

–

(2,211)

Closing net book value

2,343

3,932

4,816

11,091

5,304

10,831

4,816

20,951

(2,961)

(6,899)

–

(9,860)

2,343

3,932

4,816

11,091

Year ended 31 December 2018 Opening net book value

Impairment (net)

At 31 December 2018 Cost Accumulated amortisation and impairment Net book value

Parent 2017

Year ended 31 December 2017

Reclassification Impairment (net)

At 31 December 2017 Cost Accumulated amortisation and impairment Net book value

113

Te Wﾄ］anga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

14. Intangible assets (continued) There are no restrictions over the title of Te Wﾄ］anga o Aotearoa intangible assets, nor are any intangible assets pledged as security for liabilities. Te Wﾄ］anga o Aotearoa impaired intangible assets of $0.25m in 2018 for the group and parent (2017: $0.26m for group and parent). Programme development has been impaired due to programmes either being redeveloped to align with NZQA Targeted Review of Qualification (TRoQ) changes or programmes no longer being delivered. Software has been impaired as applications are no longer used. There were no contractual commitments for the acquisitions of intangible assets for Te Wﾄ］anga o Aotearoa and group (2017: nil) Work in progress The value of work in progress is disclosed at cost by class of asset as follows:

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

242

246

242

141

Programme development

1,332

4,745

1,316

4,675

Total

1,574

4,991

1,558

4,816

Class Software

114

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

15. Equity Accounting policy Net assets/equity is measured as the difference between total assets and total liabilities. Net assets/equity is disaggregated and classified into a number of reserves. The components of net assets/equity are: ››

accumulated funds

››

property revaluation reserves

Property revaluation reserves These reserves relate to the revaluation of land and buildings to fair value.

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

159,957

156,794

157,990

154,830

(4,921)

3,163

(5,028)

3,160

155,036

159,957

152,962

157,990

Balance at 1 January

18,684

Net revaluation gains

15,761

–

15,761

–

129

–

129

–

34,574

18,684

34,574

18,684

Land

21,647

17,029

21,647

17,029

Buildings

12,927

1,655

12,927

1,655

Total

34,574

18,684

34,574

18,684

Accumulated funds Balance at 1 January Surplus/(deficit) Balance at 31 December Property, plant and equipment revaluation reserve

Reversal of revaluation charge in equity Balance at 31 December Property revaluation reserves for each asset class consist of:

115

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

15. Equity (continued)

Capital management The capital of Te Wānanga o Aotearoa is its net assets/equity, which comprises of accumulated funds and the property revaluation reserve. Equity is represented by net assets. Te Wānanga o Aotearoa is subject to the financial management and accountability provisions of the Education Act 1989, which includes restrictions in relation to disposing of assets or interests in assets, ability to mortgage or otherwise charge assets or interests in assets, granting leases of land or buildings or parts of buildings and borrowings. Te Wānanga o Aotearoa acknowledges it has complied with the financial management and accountability provisions of the Education Act 1989 for the year ended 31 December 2018. Te Wānanga o Aotearoa manages its revenues, expenses, assets, liabilities, investments, and general financial dealings prudently and in a manner that promotes the current and future interests of the community. The equity of Te Wānanga o Aotearoa is largely managed as a by-product of managing revenues, expenses, assets, liabilities and general financial dealings. The objective of managing the equity of Te Wānanga o Aotearoa is to ensure that it effectively and efficiently achieves the goals and objectives for which it has been established, while remaining a going concern. 16. Shares in subsidiaries

Group 2018 $'000

Group 2017 $'000

Shares in DynaSpeak Limited (cost)

–

475

Total investment in subsidiaries

–

475

Country of Incorporation

DynaSpeak Limited

New Zealand

Equity Interest

Parent 2017 $'000

Investment

2018 %

2017 %

2018 $'000

100

475

Total investment in subsidiaries

Te Wānanga o Aotearoa has 100% control over Aotearoa Scholarship Trust (2017: 100%)

116

Parent 2018 $'000

2017 $'000

Te Pūrongo 2018

Talaleu Joel Ngā Poutoko Whakarara Oranga Bachelor of Bicultural Social Work

117

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

17. Early learning centres During 2018, Te Wānanga o Aotearoa received total grants of $2.6m from the Ministry of Education for early learning purposes (2017: $2.4m). These grants have been classified as non-exchange revenue.

2018 $'000

2017 $'000

545

461

549

466

491

466

–

Provision of meals for tamariki

–

Property occupancy costs

–

549

466

432

422

Low socio-economic

Special needs

465

458

417

454

Faculty Support

–

Provision of meals for tamariki

Property occupancy costs

–

465

458

Apakura Te Kākano Bulk funding Language and kaupapa

Funds applied to: Salaries Faculty Support

Resources Total funds applied

Nga Kākano o te Manukau Bulk funding

Language and kaupapa Total Ministry of Education funding received

Funds applied to: Salaries

Resources Total funds applied

118

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

2018 $'000

2017 $'000

Te Rau Oriwa 517

515

Low socio-economic

Special needs

556

565

497

565

–

Property occupancy costs

–

Provision of meals for tamariki

–

556

565

594

508

Low socio-economic

Special needs

622

537

569

537

Faculty support

–

Property occupancy costs

–

622

537

389

315

413

343

Salaries

413

343

Total funds applied

413

343

Bulk funding

Language and kaupapa Total Ministry of Education funding received Funds applied to: Salaries Faculty support Resources

Total funds applied

Raroera Te Puawai Bulk funding

Language and kaupapa Total Ministry of Education funding received Funds applied to: Salaries

Resources Provision of meals for tamariki Total funds applied

Whare Amai Bulk funding Low socio-economic Special needs Total Ministry of Education funding received Funds applied to:

119

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

18. Financial instruments The Group's activities expose it to a variety of financial risks (market risk, liquidity risk and credit risk). The Group's risk management programme focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. The Group uses derivative financial instruments such as interest rate swaps and forward foreign exchange contracts to hedge certain risk exposures. (a) Financial instrument categories The estimated carrying amount and fair values of Te Wānanga o Aoteaora and its Group's financial assets and liabilities are presented as follows:

Group 2018 $'000

2017 $'000

Parent 2018 $'000

2017 $'000

Cash and cash equivalents

10,089

5,828

9,770

5,445

Tauira and other receivables

10,666

14,151

10,655

14,111

Term deposits

67,165

69,085

65,000

67,000

Total loans and receivables

87,920

89,064

85,425

86,556

Creditors and other payables

7,726

9,444

7,713

9,619

Total financial liabilities at amortised cost

7,726

9,444

7,713

9,619

Loans and receivables

Financial liabilities at amortised cost

(b) Fair value hierarchy For those instruments recognised at fair value in the statements of financial position, fair values are determined according to the following hierarchy: ››

Quoted market price (level 1) – Financial instruments with quoted prices for identical instruments in active markets.

››

Valuation technique using observable inputs (level 2) – Financial instruments with quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in inactive markets and financial instruments valued using models where all significant inputs are observable.

››

Valuation techniques with significant non-observable inputs (level 3) – Financial instruments valued using models where one or more significant inputs are not observable.

(c) Financial instrument risks Te Wānanga o Aotearoa has policies to manage risks associated with financial instruments. Te Wānanga o Aotearoa is risk averse and seeks to minimise exposure from its treasury activities. The policies do not allow any transactions that are speculative in nature to be entered into.

120

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

Market risk Currency risk Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates. Te Wānanga o Aotearoa has only limited exposure to foreign currency risk. Te Wānanga o Aotearoa purchases library items from overseas and also attends overseas conferences which exposes it to currency risk. Fair value interest rate risk Fair value interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes in market interest rates. Investments issued at fixed rates of interest create exposure to fair value interest rate risk. Te Wānanga o Aotearoa does not actively manage its exposure to fair value interest rate risk. Cash flow interest rate risk Cash flow interest rate risk is the risk that the cash flows from a financial instrument will fluctuate because of changes in market interest rates. Investments issued at variable interest rates create exposure to cash flow interest rate risk. Credit risk Credit risk is the risk that a third party will default on its obligation to Te Wānanga o Aotearoa causing Te Wānanga o Aotearoa to incur a loss. Due to the timing of its cash inflows and outflows, Te Wānanga o Aotearoa invests surplus cash into term deposits which gives rise to credit risk. In the normal course of business, Te Wānanga o Aotearoa is exposed to credit risk from cash and term deposits with banks, debtors and other receivables. For each of these, the maximum credit exposure is best represented by the carrying amount in the statement of financial position. Te Wānanga o Aotearoa manages cashflow interest rate risk by ensuring that no more than 35% of total liquid funds are held with any one approved counter party. With the exception of tauira fees, the Group trades only with recognised and creditworthy third parties. Receivable balances are monitored on an on-going basis with the result that the Groups exposure to bad debts is not significant as a result of the ability to withhold graduation from tauira who do not pay their fees. Te Wānanga o Aotearoa holds no collateral or other credit enhancements for financial instruments that give rise to credit risk. Credit quality of financial assets The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to Standard and Poor’s credit ratings (if available) or to historical information about counterparty default rates.

121

Te Wānanga o Aotearoa

18. Financial instruments (continued)

Group 2018 $'000

Group 2017 $'000

Parent 2017 $'000

Parent 2018 $'000

77,254

69,913

74,770

67,445

A+

–

5,000

–

5,000

77,254

74,913

74,770

72,445

Existing counterparty with no defaults in the past

10,666

14,151

10,655

14,111

Total debtors and other receivables

10,666

14,151

10,655

14,111

Total financial instrument assets

87,920

89,064

85,425

86,556

Counterparties with credit ratings Cash at bank and term deposits AA-

Total cash at bank and term deposits Counterparties without credit ratings Tauira and other receivables

Liquidity risk Management of liquidity risk Liquidity risk is the risk that Te Wānanga o Aotearoa will encounter difficulty raising liquid funds to meet commitments as they fall due. Prudent liquidity risk management implies maintaining sufficient cash, the availability of funding through an adequate amount of committed credit facilties and the ability to close out market positions. Te Wānanga o Aotearoa aims to maintain flexibility in funding by keeping committed credit lines available. Te Wānanga o Aotearoa manages liquidity risk by continuously monitoring forecast and actual cash flow requirements. Contractual maturity analysis of financial liabilities The table below shows an analysis of Te Wānanga o Aotearoa financial liabilities grouped according to maturity, based on the remaining period at the balance date to the contractual maturity date. The amounts disclosed are the contractual undiscounted cash flows.

Carrying Amount $'000

Contractual Cash Flows $'000

Less than 1 Year $'000

Payables

7,726

–

Total

7,726

–

Payables

9,444

–

Total

9,444

–

Carrying Amount $'000

Contractual Cash Flows $'000

Less than 1 Year $'000

Payables

7,713

–

Total

7,713

–

Payables

9,619

–

Total

9,619

–

1-2 Years $'000

2-5 Years $'000

More than 5 Years $'000

Group 2018

Group 2017

1-2 Years $'000

2-5 Years $'000

More than 5 Years $'000

Parent 2018

Parent 2017

122

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

Contractual maturity analysis of financial assets The table below shows an analysis of Te Wānanga o Aotearoa financial assets grouped according to maturity, based on the remaining period at the balance date to the contractual maturity date. Carrying Amount $'000

Contractual Cash Flows $'000

Less than 1 Year $'000

1-2 Years $'000

2-5 Years $'000

More than 5 Years $'000

Group 2018 Cash and cash equivalents

10,089

–

Tauira and other receivables

10,666

–

Term deposits

67,165

–

Total

87,920

–

Other financial assets

Group 2017 5,828

5,828

–

14,151

–

Term deposits

69,085

–

Total

89,064

–

Carrying Amount $'000

Contractual Cash Flows $'000

Less than 1 Year $'000

Cash and cash equivalents Tauira and other receivables Other financial assets

1-2 Years $'000

2-5 Years $'000

More than 5 Years $'000

Parent 2018 9,770

9,770

–

10,655

–

Term deposits

65,000

–

Total

85,425

–

Cash and cash equivalents Tauira and other receivables Other financial assets

Parent 2017 5,445

5,445

–

14,111

–

Term deposits

67,000

–

Total

86,556

–

Cash and cash equivalents Tauira and other receivables Other financial assets

123

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

18. Financial instruments (continued)

Sensitivity analysis The tables below illustrate the potential impact to the surplus or deficit and equity (excluding retained earnings) for reasonably possible market movements with all variables held constant based on the financial instrument exposures of Te Wānanga o Aotearoa at balance date. 2018 -100bps Surplus $'000

-100bps Other Equity $'000

2018 +100bps Surplus $'000

+100bps Other Equity $'000

2017 -100bps Surplus $'000

-100bps Other Equity $'000

2017 +100bps Surplus $'000

+100bps Other Equity $'000

Group Interest rate risk – financial assets Cash and cash equivalents

(101)

–

101

–

(58)

–

Other financial assets

(672)

–

672

–

(691)

–

691

–

Total sensitivity to interest rate risk

(773)

–

773

–

(749)

–

749

–

(98)

–

(54)

–

Other financial assets

(650)

–

650

–

(670)

–

670

–

Total sensitivity to interest rate risk

(748)

–

748

–

(724)

–

724

–

Parent Interest rate risk – financial assets Cash and cash equivalents

Explanation of interest rate risk sensitivity The interest rate sensitivity is based on a reasonable possible movement in interest rates, with all other variables held constant, measured as a basis points (bps) movement. For example a decrease in 100 bps is equivalent to a decrease in interest rates of 1.0%.

19. Related party disclosure Related party disclosures have not been made for transactions with related parties that are within a normal supplier or client/recipient relationship on terms and conditions no more or less favourable than those that it is reasonable to expect Te Wānanga o Aotearoa and Group would have adopted in dealing with the party at arm's length in the same circumstances. Related party disclosures have also not been made for transactions with entities within Te Wānanga o Aotearoa Group (such as funding and financing flows), where the transactions are consistent with the normal operating relationships between the entities and are on normal terms and conditions for such Group transactions. In conducting its activities, DynaSpeak Limited received subcontracting revenue from Te Wānanga o Aotearoa to provide education services for the year ended 31 December 2018. DynaSpeak Limited invoices Te Wānanga o Aotearoa for this revenue on a monthly EFTS consumption basis. The subcontracting revenue paid by Te Wānanga o Aotearoa is disclosed in note 5 intercompany expenses.

124

Te Pūrongo 2018

Notes to the financial statements For the year ended 31 December 2018

20. Key kaimahi remuneration

Appointment Date

Retirement Date

Group & Parent 2017 $'000

Group & Parent 2016 $'000

Current council Katie Bhreatnach

Council

Jul-15

–

Vanessa Eparaima

Council Chair

Jul-15

–

Robert Gabel

Council / Audit & Risk

Jul-15

–

Bryan Hemi

Council Deputy Chair

Jul-15

–

Steve Ruru

Council / Audit & Risk

Dec-16

–

Jon Stokes

Council

Dec-16

–

Josh Wharehinga

Council / Academic Board

Jul-15

–

Dec-15

–

Jul-08

–

Independent members of other committees Ainsleigh Cribb-Su'a

Academic Board

Wayne McLean

Audit & Risk Chair

Claudia Vidal

Audit & Risk

Sep-17

–

Christopher Tooley

Academic Board

Dec-15

–

Sam Inglis

Investment Committee

May-17

–

Anaru Baynes

Academic Board

Sep-17

–

Council

Apr-14

Dec-17

–

Gary Dyall

Audit & Risk

Aug-11

Aug-18

Hinerangi Raumati-Tu'ua

Investment Committee

Jan-16

Oct-18

–

190

213

Previous council and committee members Dr Kathie Irwin

125

Te Wānanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

20. Key kaimahi remuneration (continued) Key management kaimahi and governance remuneration:

Ngā Tumu/ senior management Te Mana Whakahaere and sub-committees Total key management personnel remuneration

Short-term and kaimahi welfare benefits Other long-term benefits – KiwiSaver Total key management personnel remuneration

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

2,856

2,765

2,558

2,496

198

213

190

213

3,054

2,978

2,748

2,709

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2016 $'000

2,971

2,910

2,673

2,649

3,054

2,978

2,748

2,709

Total remuneration includes any non-financial benefits provided to kaimahi, including motor vehicle, medical insurance, life insurance and income protection insurance. Number of key management kaimahi and governance members:

Group 2018

Group 2017

Parent 2018

Parent 2017

Ngā Tumu/ senior management

Te Mana Whakahaere and sub-committees

Total

To detemine management kaimahi numbers for Nga Tumu/Senior leadership, full-time equivalents (FTE) is used. An FTE is based on kaimahi working a 37.5 hour week. To determine the number of governance members with respect to Te Mana Whakahaere and Sub-Committees, a member is recognised only once if they hold more than one position. The FTE concept is not practical to apply to governance roles.

126

Annual Report 2018

Notes to the financial statements For the year ended 31 December 2018

21. Contingencies Contingent liabilities Litigation Te Wānanga o Aotearoa had one legal claim outstanding as at balance date (2017: two). This claim relates to a legal dispute with an external party. Te Wānanga o Aotearoa has not disclosed the details of this claim as it may seriously prejudice the position of Te Wānanga with respect to disputes with other external parties. Tertiary Education Commission Investigation The Tertiary Education Commission (TEC) are undertaking an investigation of learning hours for Te Ara Reo Māori Level 1 and Level 2 and have appointed Grant Thornton New Zealand Limited. The audit commenced in November 2018 and is still in progress. Due to variables involved with the investigation, the TEC is unable to confirm a date of completion. To date the investigation has not progressed far enough for the TEC to provide an indication as to what the potential outcome will be. Total revenue collected for Te Ara Reo Māori Level 1 and Level 2 over the period of investigation, being 2016 and 2017 was $39.3m. Financial guarantee Te Wānanga o Aotearoa has no financial guarantees in place as at balance date (2017: nil). Contingent assets Te Wānanga o Aotearoa has no contingent assets as at balance date (2017: nil). 22. Capital commitments and operating leases Accounting policy (i) Operating leases Leases where the lessor retains substantially all the risks and benefits of ownership of the asset are classified as operating leases. Initial direct costs incurred in negotiating an operating lease are added to the carrying amount of the leased asset and recognised over the lease term on the same basis as the lease revenue. Operating lease payments are recognised as an expense in the surplus or deficit on a straight-line basis over the lease term. Lease incentives received are recognised in the surplus or deficit as a reduction of rental expense over the lease term. Capital commitments Capital commitments represent capital expenditure contracted for at balance date, but not yet incurred.

Capital commitments

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Buildings

–

Total capital commitments

–

127

Te WÄ nanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

22. Capital commitments and operating leases (continued)

Operating leases as lessee The Group has entered commercial leases on certain buildings where it is not in the best interest of the Group to purchase these assets. These leases have a life of between 1 and 8 years with renewal terms included in the contracts. Renewals are at the option of the Group. There are no restrictions placed upon the lessee by entering into these leases. Future minimum rentals payable under non-cancellable operating leases as at 31 December are as follows:

Non-cancellable operating leases

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

Within one year

4,569

4,558

3,834

3,526

After one year and not later than five years

7,155

5,703

6,936

5,019

Later than five years Total non-cancellable operating leases

1,476

833

1,476

833

13,200

11,094

12,246

9,378

Operating leases as lessor The Group owns a number of buildings and has entered commercial leases where it is not in the best interest of the Group to use these buildings for their operations. These leases have an average life of between one and two years with renewal terms included in the contracts. Renewals are at the option of the lessee. There are no restrictions placed upon the lessee by entering into these leases. Future minimum rentals receivable under non-cancellable operating leases as at 31 December are as follows:

Group 2018 $'000

Group 2017 $'000

Parent 2018 $'000

Parent 2017 $'000

222

172

222

172

After one year and not later than five years

157

Total non-cancellable operating leases

276

329

276

329

Non-cancellable operating leases Within one year

No contingent rents have been recognised in the statement of comprehensive revenue and expense during the period.

23. Events after the balance date There are no events after balance date (2017: nil).

128

Te PĹŤrongo 2018

Notes to the financial statements For the year ended 31 December 2018

24. Explanation of major variances against budget It should be noted the group and parent budget figures have been approved by Te Mana Whakahaere at the beginning of the year. Budget figures are prepared in accordance with NZ GAAP and are consistent with the accounting policies adopted by Te Mana Whakahaere for the preparation of the financial statements. However, some items presented in the the budget have been reclassified in the annual report to be consistent with the presentation of actuals. Explanations for major variations from Te WÄ nanga o Aotearoa group budget figures are as follows: Statement of comprehensive revenue and expense The Group result was a deficit of ($4.9m) (-3% of total revenue) which is $1.5m below to budget (-2% of total revenue). Government funding was $9.3m below budget. EFTS consumption was 747 below target due to low enrolments and plan amendments resulting in increased enrolments in lower SAC funded programmes. SAC funding also included a unfavourable balance date adjustment of $3m to recognise revenue based on start of year enrolments rather than consumption. Tauira fees were $0.7m below budget due to tauira choosing to enrol in non-fee paying programmes combined with lower than budget EFTS consumption. Other revenue was $0.6m above budget due to a new agreement being signed during the year to deliver workshops for business under the Pakihi programme. Kaimahi costs were $3.9m below budget due to less academic staff required with lower than budget tauira enrolments and EFTS consumption, this was partially offset by an overspend in non-Academic salaries due to delay in Te Puna Matauranga restructure during the year. Depreciation and amortisation was $0.7m below budget due to delay in capital spend with a number of projects being deferred. Other expenses were $3.6m below budget. Direct resource costs were $1.8m below budget with reduced tauira and lower EFTS consumption. Kaimahi training and development $0.9m below budget with reduced academic staff and training not being utilised by kaimahi. Consultancy was $0.7m below budget with underspend in various areas due to delay in projects. Software licences were $0.6m below budget also due to delay in information technology projects.

129

Te WÄ nanga o Aotearoa

Notes to the financial statements For the year ended 31 December 2018

24. Explanation of major variances against budget (continued) Statement of financial position Cash and cash equivalents are $4.3m higher than budget this is due to the timing of term deposit maturity and investment. Tauira and other receivables were $6.2m lower than budget mainly due to SAC funding being recognised based on what the course withdrawal date has passed, and the number of eligible students who have enrolled at that time, combined with lower EFTS consumption. Also, the budget assumes to classify TEC funding receivables as a payables at year end, when it is actually a receivable. Consequently this budget assumption also accounts for the budget variance in payables. Other financial assets were $50.0m higher than budget due to planned investment in funds management not being realised which also offsets and accounts for the variance in funds management. Property, plant and equipment is $12.7m higher than budget due to the impact of revaluation offset by underspend in capital expenditure. There was a revaluation uplift of $15.7m that was carried out at 31 December 2018. This also affected the property revaluation reserve and total equity. Payables were $4.0m higher than budget with the budget assuming to classify TEC funding receivables as a payables at year end, when it is actually a receivable. Consequently this budget assumption also accounts for part of the budget variance in tauira and receivables. Kaimahi entitlements were $1.9m below budget with annual leave balances and accrued salaries, less than anticpated due to the restructure and less academic staff.

Statement of cash flows Government funding receipts were $4.1m below budget mainly due to EFTS consumption being 747 below target because of low enrolments and plan amendments with increased enrolments in lower SAC funding programmes. Tauira fees receipts are $1.4m below budget from tauira choosing to enrol non-fee paying programmes combined with lower than plan EFTS consumption. Interest revenue received was $0.6m above budget as the budget assummed a trade-off of lower interest in favour of increased capital gains in planned funds management investment. However investment in funds management was not realised. Payments to kaimahi were $16.5m below budget mainly because the budget assumptions classified $11.4m of supplier payments as kaimahi payments. The remaining variance is mainly due to less academic staff being required because of lower than budget tauira enrolments and EFTS consumption, which had the impact of $3.9m savings in academic salaries and $0.9m under-utilisation of training and development. Payments to suppliers are $1.2m below budget is mainly attributed to reduced direct resource requirements as a result of lower than plan enrolments and EFTS consumption. The $11.4m budget classification variance between kaimahi and supplier payments is offset by intercompany transactions in the budget cashflow assumptions not being eliminated but kept separate. The acquisition of property, plant & equipment was $3.9m less than budget due to several property projects being cancelled or delayed. Software development was $1.3m less than budget due to several projects being deferred to 2019 and some projects reclassified as operational expenditure. Programme development was $0.8m less than budget due to several of the developments being put on hold due to NZQA category change.

130

Annual Report 2018

131

Te WÄ nanga o Aotearoa

132

Te PÅ«rongo 2018

133

Te Wānanga o Aotearoa

HEI WHAKAMAUMAHARA In rememberance

E te iwi nui tonu tēnei ka tangi mō koutou kua ngaro ki te Hono-i-wairua. Mahue mai ko mātou te hunga ora ki muri nei auē atu ai, mōteatea atu ai, mapu atu ai. Nō reira moe mai rā kei aku rau kahurangi kei aku kuru tongarerewa. Waiho mai ko mātou hei pīkau ī ā koutou ōhākī hei oranga mō ngā whakatupuranga. E moe, okioki atu.

134

Annual Report 2018

To the multitudes who have departed this world, we mourn for you as you take your place where the spirits gather. In the world of the living â&#x20AC;&#x201C; those of us who have been left behind â&#x20AC;&#x201C; we wail in sorrow, we weep as we think of you, we heave a sigh of grief. But, sleep cherished ones, treasured ones. Leave for us your works that we may continue to fulfil your aspiration to help our future generations. Forever be at rest.

135