Te Pūrongo - TWoA Annual Report 2017 by Te Wananga o Aotearoa

Annual Report 2017

Te Wānanga o Aotearoa — Annual Report 2017

In 2016, we likened our tauira journey to that of a mighty tōtara, skilfully crafted into a waka to carry our tauira as they explore uncharted territories. Te Pūrongo 2017 continues that theme and further explores the idea of the journey. Using the skills given to us by our ancestors, we collectively set our sights on the distant horizon and venture forth with confidence.

Te Wānanga o Aotearoa — Annual Report 2017

Hika Rā Taku Ahi

Kindle my sacred fire

Hika atu rā taku ahi Ki te hau e riri mai nei E rotu mate, rotu mate āio hē Tāwaha ana rā Te hau e riri mai nei E rotu mate, rotu mate, āio hē He marangai te hau E riri mai nei Haere i tua, haere i a moana nui Haere i a moana roa Haere i a moana te tākiritia Ki te whai ao, ki te ao mārama!

Contents

Te Wānanga o Aotearoa — Annual Report 2017

Ngā Uara › Our Values

In Review ›

Tā Te Heamana › Chairperson’s Report

Tā Te Taiurungi › Chief Executive’s Report

Te Mana Whakahaere › Council

Ngā Tumu › Executive Directors

Ahurea › Advancing Mātauranga Māori

He Tauira - Student Profile

Hapori › Social wellbeing for all New Zealanders

He Kaiako - Teacher profile

Arumoni › Economic wellbeing for all New Zealanders

He Tauira - Student Profile

Ngā ki taurangi › Statement of Service Performance

Te Tahua › Financial Report

Hei whakamaumahara › Remembrance

122

Te Wānanga o Aotearoa — Annual Report 2017

Ngā Matawhānui

Ngā Uara

Our vision

Our values

He takapau mātauranga, he whānau huarewa

Ngā Ture

Whānau transformation through education

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

Te Whakapono

Ngā Whakatakanga Our mission Kia angitu te tauira Tauira success

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 — Annual Report 2017

Arotakenga

In review

54%

12%

40%

10%

were Māori

were Asian

were Pākeha

were Pasifika

50%

were Other

were over 40 years old

34% had no tertiary qualifications 28% had no qualifications

70%

were Female

30% were Male

Te Wānanga o Aotearoa — Annual Report 2017

Te Wānanga o Aotearoa provides tauira learning te reo Māori across the country

66%

of all te reo Māori provision in Aotearoa

700+ kaimahi from

around the country took part in the biggest and most popular Te Mata Wānanga yet

marae and their communities benefited from our sponsorship of Marae DIY

whānau competed at Te Wānanga o Aotearoa National Waka Ama sprint competitions

TÄ Te Heamana Chairperson's report

Te Wānanga o Aotearoa — Annual Report 2017

It is my pleasure to present the Annual Report for 2017, a year of review and further achievement for Te Wānanga o Aotearoa.

Mātua rā te whakaaro ki te māreikura o te kaupapa, ki a Marie Panapa, kua ngaro i te tirohanga kanohi. Ahakoa kua riro ia, nā āna mahi i roto i ngā tau toru tekau ka huri, e whai hua tonu ana Te Wānanga o Aotearoa. Nā aua hua, e māringanui ana a au ki te whakatairanga i Te Pūrongo a Te Wānanga o Aotearoa, e kōpaki ana i ngā painga kua hua ake i te tau ka huri, nā runga i te mahi pai a ngā ringaringa me ngā waewae o Te Te Wānanga o Aotearoa whānui. He wāhanga nui tō Te Wānanga o Aotearoa kia huarewa ai a ngāi Māori, waihoki, a ngāi katoa, engari, nā te tautoko mai a ngā iwi, e huarewa nei Te Wānanga o Aotearoa, nō reira e ngā whānau, e ngā hapū, e ngā iwi, e ngā hapori , e ngā tini tauira, tēnā koutou katoa. Firstly, I want to acknowledge the sad loss of matriarch Marie ‘Aunty Ma’ Panapa, one of the founders of Te Wānanga o Aotearoa. Aunty Ma’s passing in May was keenly felt by everyone throughout the organisation. Without her dedication, commitment and hard work over more than 30 years, Te Wānanga o Aotearoa would not exist as the organisation it is today. We are all the poorer for Aunty Ma’s passing. Moe mai rā e te māreikura.

Te Wānanga o Aotearoa has a crucial role to play in improving the lives of Māori and all New Zealanders through the delivery of high quality education and training. Myself and the members of Te Mana Whakahaere are humbled by the role we play to ensure we do everything within our power to support the education and training aspirations of the many communities we serve throughout Aotearoa.

Through our Te Pae Tata Strategic Projects - our short-term twoyear focus - we have continued to review our educational performance and look to better understand and address any achievement gap for Māori and Pasifika tauira.

As a council we remain committed to delivering financial surpluses, which have characterised more than a decade of our organisational development. However, in a During the year we experienced capped EFTS environment this unprecedented demand for a number has become increasingly difficult, of our programmes. There was as can be seen in the decline in especially strong demand for te reo surplus in recent years. There are Māori programmes with tauira from a finite number of cost savings and across Aotearoa enrolling with us organisational efficiencies that can to increase their knowledge in both be achieved. Māori culture and te reo Māori. However, for the last financial year Te Wānanga o Aotearoa This demand highlights the recorded its eleventh consecutive important role Te Wānanga o Aotearoa has in the revitalisation of financial surplus of $3.163m. This is a sound result and testament to te reo Māori throughout Aotearoa. the dedicated work of the teams The national leadership role and across our organisation to achieve success we have achieved in the delivery of high quality te reo Māori a surplus under difficult financial conditions of rising costs with a courses will continue and grow. capped funding environment. Educational performance The year saw the election of a new continued to be a key focus for Government which has announced the year. As a council, Te Mana priorities around te reo Māori Whakahaere is committed to provision and supporting regional ensuring that every tauira has a New Zealand. As an education and quality educational experience training provider with excellent that is focused on helping them to results in te reo Māori learning achieve their potential. and with a unique nationwide

Te Wānanga o Aotearoa — Annual Report 2017

During the year we experienced unprecedented demand for a number of our programmes. There was especially strong in demand for te reo Māori programmes with tauira from across Aotearoa enrolling with us to increase their knowledge in Māori culture and te reo Māori.

footprint, we are excited by the opportunity to help achieve these new and important priorities. One new policy launched by the Government was the Fees Free programme policy, which will have limited impact for our organisation as we already have a focus on removing barriers to education through providing primarily fees free education. Te Mana Whakahaere has continued to review and refine the way we work. We have developed our Governance Framework to ensure we are effectively discharging our duties and responsibilities and remain committed to ensuring our long-term plan, Te Pae Tawhiti, remains the focus of everyone within the organisation. While forward focussed, Te Pae Tawhiti is built on the foundations set in place by those who came before us, giving us confidence in its ongoing success.

Whakahaere members, our sub committees - including Te Rautiaki Mātauranga, Te Ārai Tūpono, Te Ohu Paearu Utu , Te Komiti Marupainga and Te Komiti Haumi Pūtea - Te Taiurungi Dr Jim Mather, Ngā Tumu, Hoe Whakatere and all our kaimahi for the good work they do. Finally, I thank the tens of thousands of tauira who continue to show their support and appreciation for the excellent education and training we provide by enrolling and participating in our programmes throughout Aotearoa each year. The fruits and satisfaction of the labours of our students are on show throughout the country each year when thousands of tauira celebrate graduation with their whānau and friends. It is this success and achievement that remains the driving priority and focus of all that we do at Te Wānanga o Aotearoa now and into the future.

I want to acknowledge the support of my fellow Te Mana Vanessa Eparaima

TÄ Te Taiurungi CEO's report

Te Wānanga o Aotearoa — Annual Report 2017

It is with great pride that I present Te Pūrongo 2017, the Annual Report of Te Wānanga o Aotearoa.

Whakamānawatia te mana atua i te Wāhi Ngaro i āna tauwhirotanga nui mai i ngā wā katoa. Whakamānawatia hoki te mauri o te motu, Kīngi Tūheitia, te pouherenga waka, te pouherenga tangata. Tangihia ō tātau mate tāruru nui, kua huri ki tua; koutou kei te riro tītapu, okioki atu, whakangaro atu rā. Ko te akaaka o te rangi ki a rātau, ko te akaaka o te whenua ki a tātau, tihē i mauri ora! Kei ngā maunga whakahī, kei ngā wai tuku kiri o rātau mā, kei ngā kāwai nui, kei ngā kāwai roa, tēnā rā koutou katoa. Kei te whakapuke katoa te ngākau ki te whakarewa i Te Pūrongo a Te Wānanga o Aotearoa, e whakatairanga nei i ngā painga, e whakawhiwhia ana ki te katoa, kia puta tonu ai ngā iwi ki te whai ao ki te ao mārama, otirā, kia eke panuku, kia eke Tangaroa, kia māro tonu ai te rere o te waka o te mātauranga i te pae tata, ki te te pae tawhiti. Nō konei kei te mihi ki a koutou, e ngāi tauira, e koke nei ki ngā taumata, māringanui ana Te Wānanga o Aotearoa ki te tautoko i a koutou, ki te whakatinana i ō koutou tūmanako. E taea tonutia ai te pērā, me aro tonu Te Wānanga o Aotearoa ki te whakapakari i a ia anō mā te aro ki ngā takiwā, ki ōna whareako, ki ngā hōtaka, me ngā kaimahi; koinei ngā whāinga e whakatutukingia tonutia ana mā roto mai i te rautaki o Te Paetata, kia angitu tonu ai tā tātau haere ki Te Paetawhiti, ā, hei reira hoki tino huarewa ai te katoa. Waihoki, mā te kotahitanga hoki tērā e momoho ai, nō reira kei Te Mana Whakahaere, kei ngā Tumu, kei ngā Hoewhakatere, kei ngā kaimahi katoa, kei te nui te mihi ki a koutou katoa; me kore ake koutou e momoho nei tā tātau kaupapa nei, tēnā rawa atu koutou katoa.

Over the last 12 months, Te Wānanga o Aotearoa has continued its progress along a well-considered pathway towards a successful and sustainable future. This pathway is the outcome of our long-term planning process and is outlined in Te Pae Tawhiti 2027, an aspirational document providing guidance to the organisation and outlining where we want to be and how we aim to get there. In the shorter term, our two-year focus – Te Pae Tata – aligns with Te Pae Tawhiti and guides our ongoing work. It helps us focus on key objectives and outcomes rather than reacting to short-term developments. One of our key strategies in working towards a sustainable future is to continue our investment in the regions, while maintaining and upgrading our nationwide property portfolio. Te Wānanga o Aotearoa has close to 100 delivery sites across Aotearoa – of which we own about half - and the latest major investment will see a purpose-built campus developed for the 2500 tauira in Ōtautahi. It is important for Te Wānanga o Aotearoa that we maintain and improve our delivery sites for our tauira and kaimahi, despite the significant investment required. The benefits of this investment were seen in 2017 when our Tauranga campus – opened in 2016 – was judged the winner of the Accessible and Inclusive Building category at the inaugural Tauranga City Accessibility Awards. Throughout this investment phase, Te Wānanga o Aotearoa has maintained its focus on delivering a financial surplus and the $3.163m

result in 2017 represents the 11th successive year this has been achieved. The development of our property portfolio continues alongside our commitment to regularly review the range and quality of programmes we offer to ensure Te Wānanga o Aotearoa continues to meet the needs of the communities we serve. During 2017 more than 20 programmes were either launched or redeveloped while others were phased out. Te Wānanga o Aotearoa has also increased its focus on enrolments and introduced a strategy of commencing the enrolment process earlier, which has produced positive results. Work continues on this process to create a more student-centric system and improve communication with tauira, two areas which were identified for improvement in our annual Graduate Survey. At Te Wānanga o Aotearoa we consider tauira to be our biggest asset and they are at the centre of everything we do. In line with our Te Pae Tawhiti goal to be the preeminent provider of mātauranga Māori education, increasing numbers of prospective tauira are enrolling with Te Wānanga o Aotearoa to learn te reo Māori. Just over 8,000 people choose to study te reo Māori with us and Te Wānanga o Aotearoa is clearly the largest provider of te reo Māori education in New Zealand, with our programmes accounting for two thirds of all te reo Māori programmes being offered. This strong reputation for te reo Māori education supports the aim of Te Wānanga o Aotearoa to be

Te Wānanga o Aotearoa — Annual Report 2017

#MahuruMāori

considered - both domestically and internationally - as a thought leader in te reo Māori education. Our ongoing efforts to revitalise and teach te reo Māori produced excellent results during 2017. A language initiative for Te Wānanga o Aotearoa kaimahi (staff) - Mahuru Māori – has proved so successful it now attracts participants from around the world and continues to grow in popularity. In 2016, Mahuru Māori had just 80 participants. This year, registrations were capped at 500 and a further 178 kaimahi registered their interest. It was also hugely popular on social media, with more than 1000 people taking part unofficially or contributing to the movement in their own way. Its success was recognised in 2017, when it was judged winner of the education section at the 2017 Māori Language Awards while its instigator, Poutiaki Reo/Tikanga Paraone Gloyne, was a finalist in the individual section of the awards and was also nominated for the Te Waiti Award for Te Reo and Tikanga at the annual Matariki Awards. In 2017, we also launched the Taringa bilingual podcast during Matariki. Taringa has quickly passed 30 episodes and after initially attracting 2400 listeners per month, is now drawing a monthly audience of close to 8000 people. More than 35000 people have listened to at least one episode and it has been

Mahuru Māori, which was launched for Te Wānanga o Aotearoa kaimahi in 2014, continues to attract growing numbers of fans and has become so significant Te Taura Whiri I Te Reo Māori – the Māori Language Commission – changed Māori Language Week to coincide with it. Mahuru Māori began with just 80 participants but in 2017 registrations were capped at 500 and a further 178 kaimahi registered their interest.

accessed in more than 50 countries, including Hong Kong, Bolivia, Laos, Ireland and Japan. The casual tone of the podcast belies its important content and it has made a significant contribution to normalising te reo me ngā tikanga Māori. Te Wānanga o Aotearoa also contributes to the revitalisation of te reo Māori through key sponsorships and partnerships. One of our key partnerships is with Te Matatini, the national kapa haka championships, which were held in Hastings in February 2017. Te Wānanga o Aotearoa had previously been a major sponsor of the event but is now a strategic partner and we worked closely with the organisers to ensure a successful event. For Te Matatini, our Creative Services team helped develop their 2017 strategy document and produced video resources to promote the 2019 festival being held in Wellington.

Aunty Ma, 73, passed away in May after earlier suffering a heart attack at an event held at Apakura campus. While Aunty Ma’s health had been failing for some time, her passing came as a shock to everyone at Te Wānanga o Aotearoa and many kaimahi were deeply affected. Te Wānanga o Aotearoa will be forever indebted to Aunty Ma, who was an integral part of the organisation from its humble origins in Te Awamutu in the mid-1980s. Aunty Ma was also a long-serving member of Te Mana Whakahaere and retired from her role as cultural advisor in late 2016. However, she was still involved through Te Taumata Kaumātua - the kaumātua committee. The legacy she leaves is enormous.

Finally I again acknowledge the ongoing support of Te Mana Whakahaere – particularly chair Vanessa Eparaima – Ngā Tumu, Te Wānanga o Aotearoa will continue Hoe Whakatere and all kaimahi to explore partnerships such as these throughout Te Wānanga o Aotearoa. where there are mutual benefits to all Without your ongoing mahi and parties involved. commitment we would not be able to achieve a fraction of what we have. This principle of kotahitanga is one of Ngā Uara – our values – which were developed by our founders and which continue to serve Te Wānanga o Aotearoa well. Sadly, in 2017 we lost one of our remaining founders and it is timely and important to acknowledge the passing of our respected matriarch, beloved kuia and aunty to many, Marie Panapa.

Dr Jim Mather

Te Wānanga o Aotearoa — Annual Report 2017

Te Mana Whakahaere Council

Vanessa Eparaima MNZM Heamana (Chairperson) Ngāti Raukawa, Ngāti Tūwharetoa

Bryan Hemi Heamana Tuarua (Deputy Chair) BE (Civil), MBA Ngāti Kahungunu, Ngāti Koata, Samoan

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

Dr Jim Mather Mema (Member) BBus, MBA, PhD, ACA Ngāti Awa, Ngāi Tūhoe

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

Te Wānanga o Aotearoa — Annual Report 2017

The membership of Te Mana Whakahaere is determined by the Constitution and the Education Act 1989. The members of Te Mana Whakahaere come from a broad range of backgrounds and are selected for the knowledge and value they bring to the strategic direction and governance of Te Wānanga o Aotearoa.

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

Dr Kathie Irwin Mema Whakatūria (Ministerial Appointment) Poupou Karanga Certificate, DipTchg, DipTchEd, BEd (Hons), MEd, PhD Rakaipaaka, Ngāti Porou, Ngāti Kahungunu

Jon Stokes Mema Whakatūria (Ministerial Appointment) Diploma in Journalism Ngāti Raukawa, Ngāti Maniapoto

Josh Wharehinga Mema (Member) BSocSci, Grad Dip Supervision, DipAdultEd Ngāti Porou, Rongowhakaata, Te Aitanga ā Māhaki, Te Arawa

Te Wānanga o Aotearoa — Annual Report 2017

Ngā Tumu

Executive Directors

Lindsay Baxter Acting Tumutaumatua Executive Director Quality & Corporate Services DipCPM, BIT, PMP, MEd (Distinction in e-learning)

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

Dr Jim Mather Te Taiurungi Chief Executive BBus, MBA, PhD, ACA Ngāti Awa, Ngāi Tūhoe

Brent Sincock Tumuwhanake Executive Director People Ngāi Tahu

Grant Strang Tumuhangarau Executive Director Information Technology MBA, DipBS, MIIE, MIITP, CITP

Te Wānanga o Aotearoa — Annual Report 2017

Keri Milne-Ihimaera Tumuratonga Executive Director Tauira Services DipTchg, Higher Diploma Teaching, BA, DMDA Ngāi Tahu, Ngāti Mamoe

Nepia Winiata Tumuaramātauranga Executive Director Education Delivery Services Ngāti Raukawa GradDipBA, MALP (Distinction)

Hone Paul Tumukahuroa Executive Director Marketing BBus, GradDipBus Ngāti Manawa, Te Arawa

Pakake Winiata Tumuakoranga Executive Director Programmes & Development BMA (Hons), MMM, Te Panekiretanga o Te Reo Ngāti Raukawa, Ngāti Awa, Ngāti Whakaue

Te Wānanga o Aotearoa — Annual Report 2017

Ahurea (Culture)

Advancing mātauranga Māori

During the last 12 months, Te Wānanga o Aotearoa has continued its evolution into an organisation that is confident in its own identity and committed to ensuring the best educational outcomes for its tauira (students).

Ahurea provides 42% of the programme provision at Te Wānanga o Aotearoa in the subject areas of Angitu (Māori and indigenous people's development), Te Reo Rangatira (Māori language) and Toi (Māori and indigenous arts).

Alongside this commitment, we have also maintained our focus on achieving strong outcomes for kaimahi and the organisation as a whole in the areas of ahurea (cultural), arumoni (commercial) and hapori (community).

We measure success in these areas in several ways.

These three areas are inextricably linked and based on Ngā Uara - our values - of Te Aroha, Te Whakapono, Ngā Ture and Kotahitanga. Ahurea represents our belief in advancing mātauranga Māori throughout Aotearoa and providing the foundation for Māori to succeed as Māori while recognising our role in the cultural enrichment and identity of Aotearoa. Advancing mātauranga Māori is a process that includes the generation and dissemination of contemporary knowledge about our language, culture and heritage within a te ao Māori worldview. We do this by delivering a worldclass indigenous educational experience for our tauira, who in turn gain confidence in their identity and culture.

In the Te Reo Rangatira subject area, our target is to increase the proportion of both Māori and non-Māori who can speak some te reo Māori from 21% and 3.7% respectively as measured in the 2018 Census. In 2017, Te Wānanga o Aotearoa had 8038 tauira (6880 EFTS) learning te reo Māori across the country, an increase on the 5719 in 2016 and confirmation of the increasing popularity for learning te reo Māori. We regularly review and maintain a suite of high quality programmes at all levels of language ability, from beginners Level 1 to the elite Te Te Panekiretanga o Te Reo programme. Te Te Panekiretanga o Te Reo – which Te Wānanga o Aotearoa hosts - continues to produce high quality te reo Māori speakers under the guidance of Ta Tīmoti Karetu, Wharehuia Milroy and Professor Pou Temara.

In 2017, Te Te Panekiretanga graduates– accompanied by Ta Tīmoti - undertook a tour of Ireland, Wales, Scotland and the Basque region of Spain to explore language revitalisation efforts in those countries and identify ideas and techniques that could be adopted in Aotearoa. Also significant in 2017 was the increasing popularity of Mahuru Māori, an initiative launched for Te Wānanga o Aotearoa kaimahi in 2014 but which now attracts participants around the world. Mahuru Māori involves speaking te reo Māori for either a day, a week or for the whole month of September (Mahuru). Mahuru Māori was the winner of the the education section at the 2017 Māori Language Awards and its instigator, Poutiaki Reo/ Tikanga Paraone Gloyne, was a finalist in the individual section of the awards and also nominated for the Te Waiti Award for Te Reo and Tikanga at the annual Matariki Awards. In 2016, Mahuru Māori had about 80 participants throughout the organisation. This year, registrations were capped at 500 and a further 178 kaimahi registered their interest. Mahuru Māori was also hugely popular on social media – primarily Facebook with more than 1000 people taking part unofficially or contributing to the movement in their own way.

Te Wānanga o Aotearoa — Annual Report 2017

World Indigenous Peoples Conference on Education (WIPCE) – Te Wānanga o Aotearoa had a strong rangahau presence at the global WIPCE conference in Toronto in July 2017 while in October, our inaugural National Rangahau Conference - Ko Manawatina Ko Manawatoka – was held in Hamilton.

Mahuru Māori has now become so significant Te Taura Whiri i te Reo Māori – the Māori Language Commission – changed Māori Language Week to coincide with Mahuru Māori. As part of our Reo Ora strategy, 80 kaimahi had the opportunity to attend an intensive three-day Māori language Kura Reo at the Māngere campus. In 2017, the Kura Reo was extended to include beginner level speakers, along with intermediate and advanced speakers of te reo Māori. Advancing mātauranga Māori is an intrinsic part of the learning offered by Te Wānanga o Aotearoa in the areas of Toi – Māori and Indigenous Art - and Angitu – Māori and Indigenous Development - and Te Wānanga o Aotearoa remains committed to mātauranga Māori as recognised under section 162 of the Education Act 1989. The success of these and other programmes can be seen in the results of our Graduate Survey, with 98% saying they would recommend Te Wānanga o Aotearoa to their friends and whānau. This high rating has been consistent over the past three years. An overwhelming number of comments acknowledge the high calibre of our kaiako, student support, resources and facilities while they also enjoy the learning

environment provided. As in every other year of the survey, our kaiako are the biggest reason tauira rate Te Wānanga o Aotearoa so highly. Their teaching, support, guidance and patience is greatly valued. An important aspect of delivering a world-class indigenous education experience is a strong rangahau culture and this is another area of strong growth for Te Wānanga o Aotearoa. During 2017 our rangahau strategy was approved and Te Wānanga o Aotearoa has 150 kaimahi currently involved in rangahau. These kairangahau now have significant and regular rangahau outputs that inform and strengthen the application of mātauranga Māori within Te Wānanga o Aotearoa. Rangahau also forms the basis of continuous improvement across the organisation. In 2016, Te Wānanga o Aotearoa received its first significant external research funding for He Rongoā tō te reo Māori, a project that seeks to understand the barriers and motivators for learners of te reo Māori and aims to produce new teaching approaches. As part of the project, in June 2017, inaugural rangahau internships were presented to doctoral students Hohepa Maclean and Koko Hotere in an initiative that contributes to the ongoing

building of rangahau capability at Te Wānanga o Aotearoa. Te Wānanga o Aotearoa had a strong rangahau presence at the World Indigenous Peoples Conference on Education or WIPCE conference in Toronto in July 2017 while in October, our inaugural National Rangahau Conference - Ko Manawatina Ko Manawatoka – was held in Hamilton. More than 60 kairangahau presented their work at the conference, including tauira from our flagship He Waka Hiringa Master of Applied Indigenous Knowledge programme that requires tauira to complete a rangahau project that benefits hapū, iwi or community. This growing rangahau culture will play an increasingly important role in advancing mātauranga Māori throughout Aotearoa and providing the foundation for Māori to succeed as Māori. It is also an important element in terms of the cultural enrichment and identity of Aotearoa.

Tauira Profile

Making up for lost time

Bobbie Jarvis

A stroke and a pending 90th birthday aren’t stopping Bobbie Jarvis from learning about the culture she was denied for much of her life. Bobbie’s father was Māori but she says her mother never spoke of him and got rid of photos of him together with his daughter. “It took me years to find out,” she says.

These include Te Ara Reo Māori, Te Arataki Manu Kōrero, Kāwai Raupapa – Karanga and Tikanga Marae. She says the programmes have been “really valuable”. “I decided to try and learn some te reo, which has been very enlightening,” she says.

“I’ll keep on going until I learn a bit more. It has stood me in good “She hid everything from me. I stead, learning a little bit more went through life not knowing who about the way things work on a my father was. My mother may marae, how people get to do the not have known the significance jobs on the marae and the special of this but no one should ever be skills they have to bring.” denied their whakapapa.” Bobbie says Te Wānanga o She eventually recalled seeing the Aotearoa is the perfect place for name Barrett in an old recipe book people interested in learning and applied for her birth certificate about their background or Māori and her parents’ marriage culture in general. certificate, which listed her father as Turiwai Barrett from Waitomo. “The tutors are amazing and I enjoy it very much. These courses “I went from there and found my are very worthwhile.” relatives,” Bobbie says. And she has no intention of stopping. She is now happily involved with her whānau and has completed “I’m taking a weaving class next several te reo Māori and tikanga year which I am really looking programmes with Te Wānanga forward to.” o Aotearoa since retiring from a long and successful career in modelling, fashion and real estate.

Te Reo MÄ ori tauira, Bobbie Jarvis.

Te Wānanga o Aotearoa — Annual Report 2017

Hapori (Community)

Social wellbeing for all New Zealanders

There is a clear link between the commitment of Te Wānanga o Aotearoa to its role in the cultural enrichment of Aotearoa and its contribution to the social wellbeing of all New Zealanders. The two aims reflect a holistic approach to Māori development that enables transformation within a mātauranga Māori context and benefits all New Zealanders. Hapori (Community) reflects our desire to improve social wellbeing in general, leading to a more equitable society in which all New Zealanders have the opportunity to succeed in their chosen fields. Te Wānanga o Aotearoa can fulfil this desire through meeting the particular educational requirements of New Zealand’s increasingly diverse communities while removing or reducing some of the barriers to education people face. We can also enhance social wellbeing by ensuring that the skills our tauira are taught are relevant and useful to them and the communities in which they live. Partnering with whānau, hapū, iwi, communities and other stakeholders helps to focus and inform our educational offerings to achieve these outcomes. Hapori (Community) includes the learning areas of Tūāpapa (learning to study /ESOL) and

Hauora (health and fitness) and has been identified as an area of growth in the coming years. Knowing how to learn and being healthy are part of the foundation upon which skills can be built and successful outcomes achieved.

that adorned Kahungunu Park for the national kapa haka championships Te Matatini. Arts kaiako Sandy Adsett says there was never any question of working with Ngāti Kahungunu for the mammoth undertaking and the artworks created were part of a kaupapa to develop a recognised style of art for Ngāti Kahungunu.

Success in these learning areas can be seen through increasing numbers of Māori being satisfied with life overall and growing numbers of tauira sharing their Our He Waka Hiringa – Master of skills and knowledge with whānau, Applied Indigenous Knowledge hapū, iwi and their community. tauira, as part of their studies, are also required to be deeply For this sharing of skills to be involved with their communities achieved, communities and as the programme involves industry must see our tauira as the planning, creation and valuable assets. This can only completion of a community-based be achieved when Te Wānanga project. These projects range o Aotearoa is considered a from environmental restoration reputable provider of world-class projects, art exhibitions and indigenous education. social research to all aspects of Mātauranga Māori. The consistently high rate at which tauira would recommend Other tauira and kaimahi Te Wānanga o Aotearoa to their were able to contribute to friends or whānau – 98% as their communities when measured in our 2017 Graduate Te Wānanga o Aotearoa Survey – provides strong support continued its successful for this measure. partnership with television show Marae DIY during 2017. On There are also many examples – the show, tauira and kaimahi both large and small - of whānau, work with communities to hapū, iwi or communities help renovate marae around benefitting from the connections the country. For many people, our tauira have with them and the this provides an opportunity to skills they can offer. re-connect with their whānau and contribute to the wellbeing In February 2017, current of their community. tauira along with toi graduates from Heretaunga created and installed the stunning artworks

Te Wānanga o Aotearoa — Annual Report 2017

Marae DIY –Other tauira and kaimahi were able to contribute to their communities when Te Wānanga o Aotearoa continued its successful partnership with television show Marae DIY during 2017. On the show, tauira and kaimahi work with communities to help renovate marae around the country.

Further examples of Te Wānanga o Aotearoa partnering with others to achieve tauira success and whānau transformation through education include our work with Corrections, teaching inmates literacy and numeracy. In 2017, six more tauira graduated from the programme, taking the total number of inmates taught literacy and numeracy in the last two years to more than 880. Another development in 2017 was a successful partnership between Te Wānanga o Aotearoa, ACC and the School of Hard Knocks charity, which uses rugby to help transform lives. The programme saw 18 tauira join the programme and work toward their NCEA Level 2 fitness qualification. It aimed to enable them to realise their potential and stay engaged in education while receiving expert coaching and mentoring advice from rugby great Sir John Kirwan. Te Wānanga o Aotearoa has also continued our successful partnership with Waka Ama NZ and there has been strong growth in the sport along with expanded waka ama course offerings to meet tauira demand. To further enhance our connection with key communities, in 2017 Te Wānanga o Aotearoa successfully published three editions of a magazine designed to promote and educate audiences at key events throughout the year. We published the Huarewa

magazine at the Waka Ama national sprint champs, Te Matatini and ASB Polyfest.

part in what proved to be the biggest and most popular Te Mata Wānanga yet.

Along with containing eventrelevant content, the magazine also promoted Te Wānanga o Aotearoa programmes in targeted areas and proved a popular publication at the events, with 5,000 copies distributed at Te Matatini and 3,000 each at the waka ama champs and ASB Polyfest.

Meanwhile, nurturing te reo Māori among kaimahi remains a key commitment at Te Wānanga o Aotearoa through its Reo Ora Strategy, which aims to have half of all Te Wānanga o Aotearoa kaimahi proficient in te reo Māori by 2030.

Being connected within Te Wānanga o Aotearoa is equally important to the organisation, particularly one with kaimahi spread the length and breadth of the country. To enhance the connectedness throughout the organisation, every two years Te Wānanga o Aotearoa holds Te Mata Wānanga as a way of uniting kaimahi throughout the organisation. When it was first held at Papaiōea in 2005 Te Mata Wānanga was for kapa haka only. However, after kaimahi supported calls for other events to be included alongside kapa haka, friendly competition was held in 10 different sports – including touch, netball, basketball, volleyball, chess, euchre, bowls and table tennis - when Te Puna Mātauranga in Te Awamutu hosted Te Mata Wānanga in 2017.

The annual three-day Kura Reo is a key part of this strategy and in 2017 the Kura Reo was expanded to include beginning speakers along with those at more advanced levels of language ability. It is through commitments such as these to improve the social wellbeing of all New Zealanders that Te Wānanga o Aotearoa continues to fulfil its obligations and enable tauira to succeed in their chosen fields.

The change proved a positive one, with more than 700 kaimahi from around the country taking

Kaiako Profile

Making a difference

Erina Wehi-Barton Erina Wehi-Barton is a woman on a mission. A mission to make a difference, to change lives, to give back. And a mission to pack her life with adventures along the way. Erina – Ngāti Rereahu-Maniapoto – is one of 40 Home Based Learning (HBL) kaiako at Te Wānanga o Aotearoa. She provides support to around 100 tauira studying at Levels 1-3 and living in an area stretching from Āwhitu to Whakapapa. Over the course of the year, she’ll visit them every eight weeks, “or for those that are struggling or need extra support, every four weeks,” she says. Whatever support tauira need, Erina provides.

There are four programmes available to HBL tauira: He Huarahi Ako, Papa Reo, Papa Whairawa and He Papa Tikanga, and Erina says she gets the most satisfaction seeing how tauira progress throughout their learning. “One young mum studied Papa Whairawa and after that she was able to purchase a fridge without having to use a finance company because she’d learned how to budget. Another couple did Papa Whairawa and they could purchase a house. I feel like I’m making a difference.” She says her tauira provide “heaps of stories of struggle”.

However, when she does manage some time out, putting her feet up is the last thing on Erina’s mind. She is a former social worker and mental health worker and aside from her busy work schedule, she’s also a busy mum, is studying towards her master’s degree and has just got back from completing the Great Wall Marathon in China.

“When they get employed after completing a programme and then they can afford to give you a cup of tea. That sort of thing. It’s heart-warming.”

In December she’s lining up in the Hawaii Marathon and then there’s the Big Five Marathon in South Africa in July next year before her biggest challenge – so Seeing those changes is just part far – tackling the trek to Everest of the reason Erina loves her mahi. Base Camp in November 2018.

“That’s especially so for whānau that are remote, with no access to libraries, support services, even Wi-Fi. Some who live out the back “I get to be with my own people, of Taumarunui have no services help educate them and see them at all.” blossom. It’s the best job in the world.” Her tauira range from school leavers looking to build their It also comes with its share of foundation skills to whānau challenges, including unsociable learning how to budget or others hours, long distances and living learning about tikanga. out of her car. “Everyone from school leavers to doctors, nurses, principals, teachers, kuia, kaumatua, the whole spectrum. Right down to the ones who say ‘we’re not home’ but you can see the curtains moving.”

could be closed, some of the dirt tracks you go up you could easily get stuck. It’s seven days a week and not a 9-5 job because you have to work with the tauira. You have to create your own balance and take time out when you can,” she says.

“I do things like the Coast to Coast and other endurance events as well. I like to be present in the moment,” she says. There’s also a distinctly Māori approach to her endeavours. “A lot of triathlons are over our ara tūpuna, we’re kaitiaki of those tracks,” she says.

“Some of my tauira are rousies in shearing gangs and we can’t see them until after 9pm. Others you Aside from that, she is also aware can only see on a Sunday because of setting a good example. of their work. Plus you have to coexist with the elements. Roads “A lot of our people think they

can’t do long distance events because they don’t look like long distance athletes but they can. At the end of the day you still get the same medal for finishing, the same satisfaction. It’s about role modelling for my whānau, hapū, iwi, my nephews, anybody really.” As a positive role model, they don’t get much better. “I left kura in Te Kuiti with no credits, got in with the wrong people, I was a young mum, drugs, that sort of stuff, so I’m able to relate to those tauira. It’s not just words, I’ve lived it and I want to give back.” She says becoming a mother is what changed her life. “And seeing so many of our whānau who are sick and unwell. There’s a better life out there but you need to work for it as well,” she says. A key part of her role is forming relationships with her tauira and that’s important for recruitment, with word of mouth being the most effective means of encouraging tauira. She says many of the relationships will last a lifetime. “It takes patience and perseverance because you’re their support. It’s like being part of their whānau.”

Home-based learning kaiako Erina Wehi-Barton.

Te Wānanga o Aotearoa — Annual Report 2017

Arumoni (Commercial)

Economic wellbeing for all New Zealanders

As with previous chapters, Arumoni – (Commercial) recognises the interconnectedness between mātauranga Māori, the strength of communities and the economic wellbeing of all New Zealanders.

Programmes which directly support this aim include those in the areas of business, computing, education, health and social services, and skills, trades and vocations and account for 40% of the course provision throughout Te Wānanga o Aotearoa.

Enhancing mātauranga Māori helps strengthen our communities which, in turn, produces economic benefits and wellbeing for all New Zealanders.

Our programmes for small business – including the Certificate in Small Business Management, Smart Steps to Business and NZ Certificate in Business – continue to be extremely popular and provide important support for business owners throughout New Zealand.

Success in these areas enables Te Wānanga o Aotearoa to add value to the Government’s investment in our organisation, which is manifested in the economic advancement of our tauira, their whānau and Aotearoa. In working towards this holistic outcome, Te Wānanga o Aotearoa strives to deliver a suite of high quality programmes that provide pathways to further education or employment opportunities for tauira and gives them the skills and knowledge required to succeed in their chosen field. These programmes are supported by a culture of innovation throughout the organisation, which helps develop the use of innovative teaching and learning practices and increases the appeal of Te Wānanga o Aotearoa as an educational organisation of choice.

The success of these programmes led to the development of the home-based Mana Ora programme – which was introduced in 2017. This programme teaches tauira business skills alongside tikanga Māori and has proved immensely popular, with more than 150 people enrolling in the short time it has been available. Te Wānanga o Aotearoa also works to ensure a positive commercial outcome for the organisation and the professional development of its kaimahi. These outcomes are supported by our continued investment in our sites and facilities as this helps future-proof our facilities for tauira and enhances the

working conditions for our kaimahi throughout the country. To ensure the sustainability of this approach, it is equally critical that Te Wānanga o Aotearoa meets its investment plan commitments around EFTS targets, performance commitments and producing a surplus. Another key aspect of this strategy is our ongoing work to diversify our revenue streams to reduce our reliance on Government funding. This is an area which has been a key focus for the organisation during 2017 and which will continue to be an important area of ongoing focus for the organisation. A leader in this space during 2017 has been the Innovation Development Group (IDG) within Te Wānanga o Aotearoa. The group entered a partnership with Callaghan Innovation, Creative HQ, Robett Hollis, Crowe Horwath and Ernst & Young Tahi to launch business accelerator programme Kōkiri. It is dedicated to speeding up the development of early stage Māori businesses and offers a first-ofits-kind, four-month accelerator start-up programme for up to 10 Māori businesses.

Te Wānanga o Aotearoa — Annual Report 2017

Kōkiri –Following a successful launch and selection process in late 2017 – which attracted more than 100 applicants - Kōkiri is set to develop and build the capability of Māori entrepreneurs and provide the businesses taking part with mentoring, training and support during early 2018.

Following a successful launch and selection process in late 2017 – which attracted more than 100 applicants - Kōkiri is set to develop and build the capability of Māori entrepreneurs and provide the businesses taking part with mentoring, training and support during early 2018. During 2017 IDG also successfully worked with several large corporate organisations including Fonterra and Spark - to deliver tikanga and te reo Māori education to their staff through the Hei Tauawhi Māori Cultural Awareness programme. The course introduces staff to basic te reo Māori, correct pronunciation, kawa and tikanga and also provides an insight into how Māori conduct business and how concepts such as manaakitanga affect the way Māori do things. The creative services team at Te Wānanga o Aotearoa Te Ipurau also undertook a number of successful commercial ventures during 2017 and Te Wānanga o Aotearoa intends further developing this area of its business. Among the projects the Creative Services team successfully completed during 2017 was a major rebrand for the Ministry of Business, Innovation and

Employment strategy. This included the creation of video, print, and event collateral for the strategy launch. The success of this project led to further collaborative work through Te Puni Kokiri and a growing creative relationship with Te Matatini, the organisation that hosts the national kapa haka championships. For Te Matatini, Te Ipurau helped develop their 2017 strategy document and produced video resources, which were used to promote the 2019 festival to three Wellington councils during the successful bid for the Capital to host the event.

the 2018 Waitangi ki Tamaki event, thereby fostering the growing relationship between the Te Ihu takiwā (Northern region) of Te Wānanga o Aotearoa and Auckland Council. Through fostering and developing these key relationships, Te Wānanga o Aotearoa is creating valuable income streams which will – over time – improve our financial performance, decrease our reliance on Government funding and lead to a more commercially sustainable future.

These relationships help strengthen communities and provide economic benefits for all New Zealanders while our programmes in this area enhance Other commercial initiatives mātauranga Māori through being Te Ipurau often took the form of taught in an inclusive learning sponsorships - where Te Wānanga environment, informed by Māori o Aotearoa completed work on thinking and practices. behalf of external partners. These arrangements support the development of key relationships with external organisations. Examples of this approach includes production of the third edition of Te Wānanga o Aotearoa magazine Huarewa for the ASB Polyfest. This gave Te Wānanga o Aotearoa important visibility at what has become the largest Polynesian festival in the world. Te Ipurau also worked with Auckland Council to prepare for

Tauira Profile

Recipe for success

Angeleen Lewers A Whāngarei woman who gave up a nursing career to go into business making raw cakes is working with Air New Zealand to have her products used on the airline. And it’s largely thanks to the skills she received from Te Wānanga o Aotearoa. Angeleen Lewers completed the Certificate in Small Business Management in May and says without the course she would never have had the confidence or knowledge to successfully pitch her rawfood cakes to the national airline. “I couldn’t have approached Air New Zealand without doing this course,” she says. “Definitely Te Wānanga o Aotearoa helped me hugely. The course gave me a lot more mana, strength and knowledge to be a successful businesswoman.” When she first enrolled on the course, Angeleen says all she wanted was a “piece of paper to say I was a business woman and that I have the right to be a business woman”.

But that all changed during the nine-month course.

She deals with her own allergies so raw cakes was an obvious area to focus on. It’s also a market with strong potential.

“At the end, the bit of paper was obsolete. I didn’t need it because the “Allergies aren’t going to go away course helped me to become that business woman. I had the strength and there will be more people and confidence I needed,” she says. making these sorts of decisions in the future. We’re one of a kind, we’re the only business in New “I had reservations about what Zealand doing this so we’re going I would get out of it but it really to run with it.” nurtured my inner self. It made me a lot more focussed so that Angeleen says she also knows whatever comes up, I know I’ve got the knowledge and the resources to she can still talk to her kaiako for advice if she needs to. be able to help.” Angeleen launched her raw cakes business 14 months ago, giving up a 10-year career as a registered nurse so she could work with her mother. “Whānau is very important to me,” she says. “It’s not all about the money and having lots of power, it’s about being true to yourself, it’s your own journey and I feel like I can make a difference to clients.”

“Even though I graduated in May I still have that support behind me. I know I can talk to her at any time and that’s great. It’s given me so much strength and if I can do this, other people can do it too.”

Small Business Management tauira, Angeleen Lewers.

Statement of Service Performance

Te Wānanga o Aotearoa — Annual Report 2017

Te Huanganui › Outcomes Framework

Ahurea › Cultural

Hapori › Community

Arumoni › Commercial

Ngā Mahinga Here o te Mahere Haumītanga › Investment Plan Performance Commitments

Te tahua › Financial Report

Te whakamaumahara › Rememberance

122

Te Wānanga o Aotearoa — Annual Report 2017

Te Haunganui

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 Wānanga o Aotearoa — Annual Report 2017

Te Haunganui

Outcomes Framework

340

ATA

KANGA ME NGĀ M

40 HĀ

an eal

eing for al l New Z wellb

R I > COMMUN HAPO

Partner for success

Tauira connected with their iwi, hapū, marae or community

āor

al oci

NGĀ PANGA | IMPACTS

Deliver a world-class indigenous educational experience

NGĀ HUA | OUTPUTS

0 24

ARU AL s MON I > COMMER CI der mic lan a e Z wellbe ing for al l New

160

180

ono

200

Ensure sustainability through educational excellence and drive a culture of innovation

280

NGĀ HUA | OUTPUTS

100

260

NGĀ HUA | OUTPUTS

Tauira confident in their identity and culture

REA > CULTURA

Tauira have skills and knowledge to succeed

mātauranga M

NGĀ PANGA | IMPACTS

an cing

NGĀ PANGA | IMPACTS

AHU

Adv

ITY

Ā NG

K HA

Ahurea (Culture)

Advancing mātauranga Māori

We will make a difference: Our tauira are confident in their identity and culture

We will achieve this by: Delivering a world-class indigenous educational experience

Maintaining a suite of high quality mātauranga Māori programmes

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

Our rangahau contributes to mātauranga Māori

Te Wānanga o Aotearoa — Annual Report 2017

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 within a te ao Māori worldview. In 2017 56% of EFTS or 10,344 tauira studied Ahurea cultural programmes. We are experiencing unprecedented growth in demand for reo and tikanga programmes and this places us in a unique position to play a lead role in the revitalisation of te reo Māori. Next year we will look to track our progress toward this measure against the 2018 Census results.

Ngā pānga / Impact 1.2

1.2.1

Our tauira are confident in their identity and culture

Proportion of tauira who confirm an increased understanding of mātauranga Māori

2019 Target

2018 Target

2017 Target

2017 Result

80%

75%

Tauira success requires more than skills transfer – our tauira leave us knowing who they are, where they have come from and where they are going to. 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 2017 the Survey was sent to a cohort of 17,608 recent graduates and 3,028 (or 17%) took the opportunity to respond. This year 75% of tauira reported that their understanding of mātauranga Māori has increased. Although this result did not reach target, it was a 4% improvement on the 2016 result and it provides us with a good baseline to track improvement over the plan period. In 2018 we will continue to embed the Ako Wānanga framework to ensure our kaupapa matua teaching philosophy and practice are consistently delivered nationwide.

Te Wānanga o Aotearoa — Annual Report 2017

Ngā hua / Outputs 1.3

1.3.1

Maintain a suite of high quality mātauranga Māori programmes

Quality of mātauranga Māori programmes regularly reviewed

2019 Target

2018 Target

2017 Target

2017 Result

3 reviews

4 reviews

We are committed to providing a suite of high quality programme pathways and with a number of long-standing mātauranga Māori programmes, the internal review process provides a timely assessment of how we can improve. In 2017 the following programmes were reviewed: ››

Kāwai Raupapa - Introduction to Māori Art (Level 3)

››

Certificate in Waka (Level 4)

››

Te Ara Reo Māori (Level 2)

››

Te Pīnakitanga ki te Reo Kairangi (Level 7)

In addition to the ongoing review work programme, a Te Pae Tata strategic initiative will result in the establishment of a centre of excellence to drive improvements in te reo Māori provision.

1.4

1.4.1

Contribute to achievement of the Māori Language Strategy - Te Rautiaki Reo Māori

Deliver Māori language and cultural initiatives

2019 Target

2018 Target

2017 Target

2017 Result

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 all year round. The following list highlights 10 key initiatives for 2017:

››

Now coinciding with Te Wiki o te reo Māori, Mahuru Māori continues to grow in popularity with 1,500 participants taking up the challenge to speak te reo for a day, a week or the whole month of September.

››

After touring the country last year, Te Wānanga o Aotearoa short film Te Iwa o Matariki screened at the Auckland Museum during Matariki.

Te Wānanga o Aotearoa — Annual Report 2017

››

In July we launched Taringa, a weekly bilingual podcast aimed at anyone wanting a relaxed and fun introduction to te reo or tikanga Māori.

››

We sponsored major cultural events including the Waka Ama Sprint Nationals, Polyfest and Te Matatini.

››

In addition to encouraging kaimahi participation in Te Matatini, we held our own biannual kapa haka competition, Mata Wānanga.

››

Every year the Aotearoa Scholarship Trust provides a range of scholarships to support the higher education aspirations of tauira.

››

Tā Timoti Keretū accompanied Te Panekiretanga graduates on a tour of Ireland, Wales, Scotland and the Basque region of Spain to explore language revitalisation efforts and identify ideas and techniques that could be adopted in Aotearoa.

››

To support the strategic goal for kaimahi to be proficient in te reo, 80 kaimahi had the opportunity to attend a three-day full immersion Kura Reo.

››

We delivered Hei Tauawhi Māori Cultural Awareness programme to a number of large corporate organisations.

››

Seed funding from Ngā Pae o te Māramatanga was utilised to develop a full funding proposal for a flagship rangahau project into te reo Māori.

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

2019 Target

2018 Target

2017 Target

2017 Result

80%

60-75%

77%

During the year great progress was made toward the objectives of Te Rautaki Rangahau 2015-19 (Rangahau Strategy) with 77% of degree-teaching kaiako having an Individual Rangahau Plan (IRP), exceeding the target range by 2%. There is likely to be an exponential increase in the number of research active kaiako due to a new policy that embeds rangahau activity as a core mahi of degree-teaching kaiako. Once an IRP is in place, kaimahi are provided with opportunities to publish their rangahau in our internally peer reviewed journal Wāhia Ngā Ngaru, and they are able to share it with their peers at rangahau conferences at takiwā and national level. In 2017, a select number of kaimahi were also supported to travel to Canada to present at the World Indigenous Peoples Conference on Education (WIPCE). 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. This year there were 16 graduates (or research outputs) and we fell slightly short of the target due to a handful of tauira taking longer to complete the qualification.

Hapori (Community)

Social wellbeing for all New Zealanders

We will make a difference: Our tauira are connected with their iwi, hapĹŤ, marae or community

We will achieve this by: Partnering for success Tauira are actively sought after by their communities and industry

TWoA is recognised as a reputable and desirable national provider

Te Wānanga o Aotearoa — Annual Report 2017

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 2017 we refocussed the outcome indicator on Māori life satisfaction as a positive indicator of whānau transformation. In 2017, 12% of EFTS or 3,247 tauira studied Hapori programmes such as learning to study, ESOL or health and fitness. Hapori is reflected in our community based delivery model with over 80 sites nationwide – we are in the community and for the community. Next year we will look to track our progress toward this measure against the 2018 Census results.

Ngā pānga / Impact 2.2

2.2.1

Our tauira are connected with their iwi, hapū, marae or community

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

2019 Target

2018 Target

2017 Target

2017 Result

85%

80%

88%

Our tauira are strengthened through meaningful connections they make whilst 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. We measure our impact through the Graduate Survey (see 1.2.1 for survey summary) and this year we exceeded the target for the proportion of tauira who are sharing their new skills by 8%.

––

Te Wānanga o Aotearoa — Annual Report 2017

Ngā hua / Outputs 2.3

2.3.1

Tauira are actively sought after by their communities and industry

Stakeholders satisfied

2019 Target

2018 Target

2017 Target

2017 Result

85%

73%

The 2017 Stakeholder Survey was sent to a cohort of 164 active stakeholders with 35 (or 21%) 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 provided positive feedback such as ‘the best place to learn and connect, people, culture and identity’. However, with only 73% of stakeholders satisfied or highly satisfied, there is much room for improvement. In 2018 we will look to improve communication and more actively manage stakeholder relationships across the organisation through better utilisation of the stakeholder database.

2.4

2.4.1

TWoA is recognised as a reputable and desirable national provider

Proportion of tauira who would recommend TWoA to friends and whānau

2019 Target

2018 Target

2017 Target

2017 Result

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 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. This year 98% of graduates would recommend Te Wānanga o Aotearoa to their whānau and friends, exceeding the target by 3%.

Arumoni (Commercial)

Economic wellbeing for all New Zealanders

We will make a difference: Tauira have the skills and knowledge to succeed

We will achieve this by: Ensure sustainability through educational excellence/Drive a culture of innovation Meet Investment Plan commitments

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

Diversify revenue streams to reduce reliance on government funding

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

Te Wānanga o Aotearoa — Annual Report 2017

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 2017 32% of EFTS or 10,344 tauira studied Arumoni programmes such as business, computing, teaching and social work. Many of our tauira start their higher education journey with us and whilst 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. Next year we will look to track our progress against the result published in the 2017/18 Household Economic Survey.

Ngā pānga / Impact 3.2

3.2.1

Tauira have the skills and knowledge to succeed

Proportion of tauira who reported a positive employment-related outcome

2019 Target

2018 Target

2017 Target

2017 Result

69%

67%

65%

61%

We aim to transform tauira to think for themselves, plan for themselves and provide for themselves and we use the Graduate Survey (see 1.2.1 for survey summary) to monitor the cultural, social and economic impact of studying with us. At 61%, the proportion of tauira who reported a positive employment-related outcome did not reach the target. However, it did provide an important benchmark to track improvement over the plan period. Our tauira profile is unique, 28% have no secondary qualifications and 34% have no prior tertiary qualification. This means that many tauira have a lower entry point and a complexity of issues that present barriers to achieving a qualification or employment outcome. Our long-standing Free Fees scheme is just one way that we aim to reduce barriers for our tauira and in 2018 we will also review the Tauira Footprint (that tracks our involvement with tauira from first contact through to graduation) to ensure that every tauira receives a high quality experience that sets them up for success.

Te Wānanga o Aotearoa — Annual Report 2017

Ngā hua / Outputs 3.3

Meet Investment Plan Performance Commitments

2019 Target

2018 Target

2017 Target

2017 Result

99-102%

98.9%

3.3.2 Surplus

3.3.3

Met

Not Met

3.3.1

EFTS target

Performance commitments

The year was characterised by strong demand for SAC Level 3 and our cultural programmes. However, late notice of the programmes awarded funding through the Level 1 and 2 competitive process and ongoing challenges with Youth Guarantee meant that the overall EFTS result fell slightly short of the target range for 2017. The 3% surplus target aligns with TEC financial guidelines. Although the surplus also fell short of the target at 2% or $3.2 million, it was still a solid result with the decrease in planned revenue (detailed in the Cost of Service) offset by a decrease in planned expenditure. The Investment Plan performance commitments are detailed in the following section. In 2018 we will look to move from analysis to action to improve education performance through the EPI Improvement Project.

3.4

3.4.1

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

EER capability in self-assessment and educational performance

2019 Target

2018 Target

2017 Target

2017 Result

Confident

Not Available

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. At the time of preparing this report, the outcome of the review is unknown. When the results of the EER are released, the Te Pae Tata Quality project includes a workstream to implement any recommendations.

Te Wānanga o Aotearoa — Annual Report 2017

3.5

3.5.1

Diversify revenue streams to reduce reliance on government funding

Increase proportion of funding from non-government sources

2019 Target

2018 Target

2017 Target

2017 Result

17%

15.5%

14%

Traditionally tertiary education providers have three main sources of income; SAC funding, student tuition fees, and research. 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. At 14% we met the target for 2017 and we expect ongoing investment activity will continue to have a positive impact.

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

2019 Target

2018 Target

2017 Target

2017 Result

> 90%

86%

Strategy Implemented

Develop Strategy

Achieved

We use the Graduate Survey (see 1.1.2 for survey summary) to monitor tauira satisfaction. In 2017 we fell short of the target with a satisfaction rate of 86%. An analysis of the survey results showed that despite our tauira having an overwhelmingly positive experience, our enrolment processes and communications must improve. In response to this feedback we have launched the Enrolment project to overhaul enrolment processes. A Blended Learning Strategy, including a plan for better utilisation of the in-house learning management platform, iAkoranga, was approved in November 2017.

Te Wānanga o Aotearoa — Annual Report 2017

Cost of Service Statement For the year ending 31 December 2017

Group Actual 2016 $'000

Group Budget 2017 $'000

Group Actual 2017 $'000

Parent Actual 2016 $'000

Parent Actual 2017 $'000

Ahurea Cultural

75,922

83,588

83,831

73,736

84,889

Hapori Community

33,482

9,415

19,518

35,041

16,511

Arumoni Commercial

47,192

68,679

53,320

45,834

56,591

156,596

161,682

156,668

154,611

157,992

Ahurea Cultural

69,562

79,290

71,539

67,328

76,313

Hapori Community

35,414

10,020

30,457

37,353

22,398

Arumoni Commercial

49,001

67,562

51,509

47,612

56,120

153,977

156,872

153,505

152,294

154,831

2,619

4,810

3,163

2,317

3,160

Revenue

Total revenue Expenditure

Total expenditure Operating surplus/deficit

The Cost of Service Statement includes 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 14 December 2016 and presented in the Statement of Comprehensive Revenue and Expense. For the Cultural and Commercial outcomes the 2017 actual figures reflect shifts within the outcome groupings (detailed in the Outcomes Framework Mix of Provision below). The increase in Community revenue is due to the accounting treatment of DynaSpeak. The overall drop in planned revenue is attributable to the reduction in EFTS, a decrease in sub-contracting revenue and less tauira undertaking fee paying programmes (ie. degrees).

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.

2017 Planned

2017 Actual

2018 Planned

2019 Planned

Arumoni – Commercial

6,890

6,444

6,807

6,932

Hapori – Community

3,600

2,435

3,871

3,974

Ahurea – Cultural

9,594

11,307

9,377

9,100

20,084

20,186

20,054

20,006

Total

Te Wānanga o Aotearoa — Annual Report 2017

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.

2017 Planned

2017 Actual

2018 Planned

2019 Planned

Arumoni - Commercial

6,890

6,444

6,807

6,932

Te Arawhānui (business)

3,084

2,943

2,925

2,720

Te Arawhānui (computing)

1,544

1,362

1,343

1,107

Te Hiringa (education)

505

351

542

583

Rātonga Papori (health and social services/youth work)

997

1,052

1,094

1,274

Umanga (skills, trades and vocations)

704

736

867

1,194

Hapori - Community

3,600

2,435

3,871

3,974

Tūāpapa (learning to study/ESOL)

2,588

1849

2,496

2,587

Hauora (health and fitness)

1,012

586

1,375

1,388

Ahurea - Cultural

9,594

11,307

9,377

9,100

Angitu (Māori and indigenous people's development)

2,582

2,999

2,167

2,190

Te Reo Rangatira (Māori language)

5,674

6,884

5,856

5,618

Toi (Māori and indigenous arts)

1,338

1,424

1,354

1,292

20,084

20,186

20,054

20,006

Total

During 2017 there was a significant increase in Ahurea EFTS reflecting demand for cultural programmes such as the newly launched Papa Reo (te reo Māori for beginners). Hapori EFTS were down due to difficulties operationalising the agreed mix of provision for SAC Level 1 and 2 that was subject to the competitive funding process at the time of plan approval. Arumoni EFTS were also down due to less demand for degrees and under-delivery of Youth Guarantee (with 453 of 565 planned YG EFTS delivered).

Te Wānanga o Aotearoa — Annual Report 2017

Investment Plan Performance Commitments This section includes performance commitments from Te Wānanga o Aotearoa 2017-2019 Investment Plan that is negotiated with the Tertiary Education Commission (TEC). These targets align strategic objectives with government goals set out in the Tertiary Education Strategy. The 2017 results are interim as they are subject to validation by the TEC following submission of the final single data return in April 2018. The TEC publishes the actual result on their website annually and the 2016 results in this report have been updated accordingly.

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

Māori

Pasifika

NQF Level

2015 Actual

2016 Actual

2017 Target

2017 Interim Result

Level 1 and 2

13%

12%

13%

Level 3 and above

41%

43%

40%

Level 4 and above

30%

33%

30%

27%

Level 1 and 2

Level 3 and above

Level 4 and above

Level 3 and above

10%

12%

Level 4 and above

10%

Under 25

Te Wānanga o Aotearoa continues to attract large numbers of Māori and Pasifika tauira. However, the increase in tauira studying cultural programmes has shifted our demographic profile with 4% more European tauira and 1% less tauira who are Māori or Pasifika tauira in 2017. This means that although we met the targets for the proportion of Māori and Pasifika tauira studying at Level 1 and 2, the Level 3 and above, and Level 4 and above targets were not met. The shift in our demographic profile also saw the proportion of tauira under the age of 25 drop by 1% and this was reflected in the results that both fell short of the target. In 2018 we will continue to implement the Youth Strategy to increase participation from the youth demographic.

Te Wānanga o Aotearoa — Annual Report 2017

SAC Level 1 – 2 The following table shows education performance results for tauira studying at Level 1 and 2.

2015 Actual

2016 Actual

2017 Target

2017 Interim Result

Successful course completion rate (SAC eligible EFTS)

75%

76%

75%

74%

Qualification completion rate (SAC eligible EFTS)

67%

68%

70%

69%

Student retention rate (SAC eligible student count)

61%

63%

68%

64%

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

50%

52%

40%

50%

Te Wānanga o Aotearoa is the largest provider of foundation education programmes delivering 5,400 SAC Level 1 and 2 EFTS in 2017. We aim to deliver a quality educational experience that lifts tauira aspirations and gives them the confidence to take the next step in tertiary education or employment and this is reflected in our sector leading progression rate. Despite the disruption caused by the Level 1 and 2 competitive funding process we returned a solid performance with course and qualification completions close to target, retention missed target and progression exceeding target by 10%. In addition to the EPI Improvement project, we will also work with the TEC to ensure that foundation education is targeted to deliver positive outcomes for tauira.

SAC Level 3 and above The interim results show: ››

course completions were similar to 2016 (with the exception of youth tauira), however the targets were not met;

››

qualifications completions at Level 3 and above were similar to 2016, the Level 4 and above results improved on 2016, and we edged closer to the targets;

››

retention rates fell below 2016 levels and the targets were not met; and

››

progression rates were similar to 2016 and the targets were not met.

Whilst the Pasifika qualifications completions result is pleasing, it is likely that shifts in our tauira profile and programmes studied has had an impact on the 2017 results (particularly for the smaller youth cohort). It should be noted that these targets are set at a level that is well above current wānanga sector performance. Despite this, our focus remains on positive outcomes for all tauira and in 2018 we will look to improve education performance and address any achievement gap for Māori and Pasifika tauira through the EPI Improvement Project.

Te Wānanga o Aotearoa — Annual Report 2017

The following table shows education performance results for tauira studying at Level 3 and above.

2015 Actual

2016 Actual

2017 Target

2017 Interim Result

Level 3 and above

81%

79%

83%

78%

Level 4 and above

80%

79%

83%

79%

Level 3 and above

74%

78%

72%

Level 4 and above

74%

78%

73%

Level 3 and above

78%

77%

81%

75%

Level 4 and above

78%

77%

81%

77%

Level 3 and above

79%

77%

82%

76%

Level 4 and above

79%

82%

76%

Level 3 and above

75%

74%

80%

74%

Level 4 and above

74%

80%

76%

Level 3 and above

65%

68%

65%

Level 4 and above

65%

68%

67%

Level 3 and above

72%

71%

76%

71%

Level 4 and above

71%

72%

76%

73%

Level 3 and above

69%

75%

73%

Level 4 and above

68%

69%

75%

77%

81%

77%

80%

75%

77%

74%

78%

71%

79%

75%

78%

73%

38%

39%

44%

38%

41%

44%

39%

42%

43%

44%

43%

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 rate (SAC student count)

Māori Pasifika

Levels 1 to 3, to a higher level

Te Wānanga o Aotearoa — Annual Report 2017

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 to a higher level from: (YG student count)

NQF Level

2015 Actual

2016 Actual

2017 Target

2017 Interim Result

Level 1

72%

65%

70%

Level 2

71%

61%

70%

53%

Level 3

74%

64%

70%

54%

Level 1 and 2

80%

63%

70%

53%

Level 3

57%

53%

60%

45%

Level 1

60%

Level 2

66%

65%

57%

Level 3

73%

61%

70%

60%

Level 1

42%

45%

40%

48%

Level 2

21%

27%

25%

Level 3

16%

20%

17%

The Youth Guarantee course and qualifications completion results are disappointing, but there are a number of factors which make it difficult to maintain performance including: ››

operationalising a course within a short lead-in time and ensuring that quality kaiako and pastoral care is in place;

››

tauira have complex issues outside of the classroom; and

››

course loading may be too high for some tauira who struggled in mainstream education.

In 2018 we will be looking very closely at Youth Guarantee provision and work with the Tertiary Education Commission to ensure that the programme continues to deliver positive outcomes for at-risk tauira.

Te Wānanga o Aotearoa — Annual Report 2017

Other commitments 2015 Actual

2016 Actual

2017 Target

2017 Interim Result

$50

$60

The number of research degrees completed

The number of international student EFTS

154

128

The amount of external research income earned ($000)

During the year we received $60,000 in external research income from Ngā Pae o te Māramatanga to develop a full funding proposal for a te reo Māori research project. We fell slightly short of the research degree completions target with 16 completions from the smaller Hamilton cohort of He Waka Hiringa. Through DynaSpeak we delivered 128 international EFTS, exceeding the target by 58 EFTS.

Te Wānanga o Aotearoa — Annual Report 2017

Tauira Profile The following tables provide an overview of tauira demographics from 2013. Our tauira profile has remained relatively steady over the last five years due to the capped funding environment. However, a significant increase in tauira studying cultural programmes has shifted our demographic profile in 2017.

Tauira Year

Tauira

2017

31,636

2016

31,291

2015

30,467

2014

32,235

2013

31,808

EFTS

Year

Overall

SAC 1-2 EFTS

SAC 3+ EFTS

Youth Guarantee

2017

20,201

5,400

14,278

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

2013

20,716

7,057

13,299

319

Te Wānanga o Aotearoa — Annual Report 2017

Tauira Ethnicity Year

Māori

European

Asian

Pasifika

Other

2017

54%

40%

12%

10%

2016

55%

36%

12%

11%

2015

55%

34%

12%

11%

2014

54%

36%

12%

11%

2013

50%

37%

14%

10%

Tauira Age Year

Under 25

25 to 39 Years

40 Years +

2017

14%

36%

50%

2016

15%

33%

52%

2015

16%

32%

52%

2014

17%

32%

52%

2013

16%

32%

52%

Te Wānanga o Aotearoa — Annual Report 2017

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 31,636 tauira: ››

54% are Māori, 40% European, 10% Pasifika, 12% Asian;

››

70% are female and 30% male;

››

half are over 40 years of age (52%);

››

28% had no secondary qualifications and 34% had no prior tertiary qualification;

››

14% 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 scheme 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. As a kaupapa Māori organisation with 1,857 full-time and part-time kaimahi, including 63% Māori, we seek to ‘walk the talk’ through values-based employment policies and practices. In the 2017 Wānanga Ora climate survey, 77% of kaimahi are committed to Te Wānanga o Aotearoa and 78% were proud to work here. Family-friendly working environments and professional development opportunities are just some of the initiatives that we provide for the approximately 65% female and 35% male kaimahi.

Financials

Te Wānanga o Aotearoa — Annual Report 2017

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

Hei whakamaumahara › Remembrance

122

Te Wānanga o Aotearoa — Annual Report 2017

Statement

of Responsibility In the financial year ended 31 December 2017, 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 2017.

26 | 04 | 18 Vanessa Eparaima, Chair

26 | 04 | 18 Dr Jim Mather, Te Taiurungi (CEO)

Te Wānanga o Aotearoa — Annual Report 2017

Independant Auditor's Report To the readers of Te Wānanga o Aotearoa Te Kuratini o Ngā Waka and Group's financial statements and non-financial performance information for the year ended 31 December 2017. 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 Te Wānanga o Aotearoa and group on his behalf.

the financial position as at 31 December 2017; and

Opinion

the statement of service performance of Te Wānanga o Aotearoa and group on pages 38 to 62 presents fairly, in all material respects, Te Wānanga o Aotearoa and group’s service performance achievements measured against the proposed outcomes described in the investment plan for the year ended 31 December 2017.

We have audited: ››

the financial statements of Te Wānanga o Aotearoa and group on pages 70 to 118, that comprise the statement of financial position as at 31 December 2017, the statement of comprehensive income, 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 financial performance and cash flows for the year then ended; and comply with generally accepted accounting practice in New Zealand in accordance with Public Benefit Entity Reporting Standards; and

In our opinion:

Our audit was completed on 26 April 2018. This is the date at which our opinion is expressed. The basis for our opinion is explained below. In addition, we outline the responsibilities of the Council and our responsibilities relating to the financial statements and the statement of service performance, we comment on other information, and we explain our independence.

››

Basis for our opinion

››

the statement of service performance of Te Wānanga o Aotearoa and group on pages 38 to 62.

the financial statements of Te Wānanga o Aotearoa and group on pages 70 to 118: present fairly, in all material respects:

We carried out our audit in accordance with the AuditorGeneral’s Auditing Standards, which incorporate the Professional

and Ethical Standards and the International Standards on Auditing (New Zealand) issued by the New Zealand Auditing and Assurance Standards Board. Our responsibilities under those standards are further described in the Responsibilities of the auditor section of our report. We have fulfilled our responsibilities in accordance with the Auditor-General’s Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Responsibilities of the Council for the financial statements and the statement of service performance The Council is responsible on behalf of 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 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

Te Wānanga o Aotearoa — Annual Report 2017

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 Te Wānanga o Aotearoa and group for assessing 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 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 AuditorGeneral’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 Te Wānanga o Aotearoa and group’s investment plan. 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 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 related to events or conditions that may cast significant doubt on 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.

Te Wānanga o Aotearoa — Annual Report 2017

However, future events or conditions may cause 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 6 to 34, but does not include the financial statements and the statement of service performance, and our auditor’s report thereon. 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.

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 Te Wānanga o Aotearoa or any of its subsidiaries.

Clarence Susan Audit New Zealand On behalf of the AuditorGeneral Tauranga, New Zealand

Independence We are independent of 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

Te Wānanga o Aotearoa — Annual Report 2017

Statement of comprehensive revenue and expense For the year ended 31 December 2017

Note

Actual 2017 $'000

Group Budget 2017 $'000

Actual 2016 $'000

Actual 2017 $'000

Parent Budget 2017 $'000

Actual 2016 $'000

Government funding

134,990

138,261

133,769

134,990

138,261

133,769

Tauira fees

6,100

7,030

6,534

4,734

6,268

5,206

Interest revenue

2,813

2,297

2,931

2,746

2,220

2,855

Other revenue

12,766

14,105

13,362

15,522

15,954

12,781

156,669

161,693

156,596

157,992

162,703

154,611

(89,260)

(92,482)

(90,069)

(84,879)

(88,026)

(85,765)

13,14

(10,660)

(12,639)

(10,305)

(10,463)

(12,404)

(10,069)

(53,586)

(51,752)

(53,603)

(59,490)

(57,530)

(56,460)

Revenue

Total income

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

(153,506) (156,873) (153,977) (154,832) (157,960) (152,294) 3,163

4,820

2,619

3,160

4,743

2,317

Gains/(loss) on property revaluations

–

Total other comprehensive income

–

3,163

4,820

2,619

3,160

4,743

2,317

Other comprehensive revenue and expense

Total comprehensive income

Explanations of major variances against budget are provided in note 25. The accompanying notes form an integrated part of these financial statements.

Te Wānanga o Aotearoa — Annual Report 2017

Statement of changes in net assets / equity For the year ended 31 December 2017

Group Balance as at 1 January 2016

Note

Actual Accumulated Comprehensive Revenue and Expense $'000

Actual property revaluation reserves $'000

Actual total net assets/equity $'000

Budget $'000

154,175

18,684

172,859

155,073

2,619

–

2,619

5,438

–

156,794

18,684

175,478

160,511

156,794

18,684

175,478

164,653

3,163

–

3,163

4,820

Total comprehensive revenue and expense for the year Total transactions with owners of the entity Balance at 31 December 2016

– 15

Group Balance as at 1 January 2017 Total comprehensive revenue and expense for the year Total transactions with owners of the entity Balance at 31 December 2017

–

159,957

18,684

178,641

169,473

152,513

18,684

171,197

152,913

2,317

5,438

Parent Balance as at 1 January 2016 Total comprehensive revenue and expense for the year

2,317

Total transactions with owners of the entity Balance at 31 December 2016

–

– –

–

154,830

18,684

173,514

158,351

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

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

Te Wānanga o Aotearoa — Annual Report 2017

Statement of financial position For the year ended 31 December 2017

Note

Actual 2017 $'000

Group Budget 2017 $'000

Actual 2016 $'000

Actual 2017 $'000

Parent Budget 2017 $'000

Actual 2016 $'000

ASSETS Current assets Cash and cash equivalents

5,828

5,332

8,926

5,445

4,636

8,362

Tauira and other receivables

14,151

3,262

14,732

14,111

3,220

14,713

Other financial assets

69,085

62,050

61,050

67,000

60,000

59,000

Inventories

2,083

1,901

1,915

2,081

1,883

1,906

–

1,105

–

1,264

–

730

894

725

638

847

657

Intercompany Prepayments Assets held for sale Total current assets

–

739

–

739

–

91,877

75,283

87,348

89,275

72,589

84,638

Non-current assets Property, plant and equipment

93,184

101,664

96,318

92,946

100,080

96,010

Intangible assets

11,435

11,611

8,353

11,091

11,224

7,966

Investment property

–

1,333

–

Shares in subsidiaries

–

475

Total non-current assets

104,619

113,275

104,671

104,512

113,112

104,451

Total assets

196,496

188,558

192,019

193,787

185,701

189,089

9,444

9,884

8,765

9,619

9,378

8,440

419

271

–

LIABILITIES Current liabilities Payables

Tauira fees Kaimahi entitlements

7,574

8,887

7,185

7,158

8,587

6,894

Provisions

–

104

–

104

–

17,525

18,913

16,319

16,855

18,107

15,412

330

172

206

258

172

147

–

330

172

222

258

172

163

17,855

19,085

16,541

17,113

18,279

15,575

178,641

169,473

175,478

176,674

167,422

173,514

Lease make-good Total current liabilities Non-current liabilities Provisions Payables Total non-current liabilities Total liabilities Net assets Equity Accumulated funds

159,957

150,789

156,794

157,990

148,738

154,830

Property revaluation reserve

18,684

178,641

169,473

175,478

176,674

167,422

173,514

Total equity

Explanations of major variances against budget are provided in note 25. The accompanying notes form an integrated part of these financial statements.

26 | 04 | 18

For and on behalf of Te Mana Whakahaere: Vanessa Eparaima, Chair

26 | 04 | 18 Dr Jim Mather, Te Taiurungi (CEO)

Te Wānanga o Aotearoa — Annual Report 2017

Statement of cash flows For the year ended 31 December 2017

Actual 2017 $'000

Group Budget 2017 $'000

Actual 2016 $'000

Actual 2017 $'000

Parent Budget 2017 $'000

Actual 2016 $'000

135,357

138,261

133,817

135,357

138,261

133,817

6,483

6,706

6,520

4,969

5,944

5,112

Receipt from intercompany

–

3,500

–

200

Payment to intercompany

–

(9,353)

–

(6,060)

2,908

2,297

4,781

2,842

2,220

4,696

–

13,117

13,969

12,614

12,377

13,266

11,880

Payments to kaimahi

(92,121)

(95,437)

(93,414)

(87,859)

(88,388)

(89,054)

Payments to suppliers

(52,606)

(49,135)

(54,973)

(49,137)

(55,013)

(51,226)

(316)

–

577

194

–

414

12,826

16,661

9,926

12,893

16,290

9,782

439

–

932

435

–

932

(5,921)

(12,736)

(7,729)

(5,884)

(12,710)

(7,651)

(721)

(64)

(562)

(706)

–

(458)

Purchase of programme development

(1,686)

(5,410)

(662)

(1,655)

(5,380)

(651)

Purchase of investments

(8,035)

(7,000)

(1,980)

(8,000)

(7,000)

(2,000)

(15,924)

(25,210)

(10,001)

(15,810) (25,090)

(9,828)

Cash flows from financing activities

–

Net cash flow from financing activities

–

(3,098)

(8,549)

(75)

(2,917)

(8,800)

(46)

8,926

13,881

9,001

8,362

13,436

8,408

5,828

5,332

8,926

5,445

4,636

8,362

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

GST (net) Net cash flow from operating activites

Sale of property, plant and equipment Purchase of property, plant and equipment Purchase of software development

Net cash flow from investing activities

Net (decrease)/increase in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year

Explanations of major variances against budget are provided in note 25. The accompanying notes form an integrated part of these financial statements.

Te Wānanga o Aotearoa — Annual Report 2017

Statement of cash flows continued Reconciliation of net surplus/(deficit) after tax to net cash flow from operating activities Group Actual 2017 $'000

Group Actual 2016 $'000

Parent Actual 2017 $'000

Parent Actual 2016 $'000

3,163

2,619

3,160

2,317

10,657

10,305

10,462

10,069

Asset impairment

401

213

401

213

Provisions/(provision reversal)

124

(13)

111

(24)

–

(68)

–

(66)

11,182

10,437

10,974

10,192

(265)

(248)

(261)

(248)

(3,128)

(2,580)

(3,128)

(2,580)

(3,393)

(2,828)

(3,389)

(2,828)

(169)

(344)

(173)

(356)

487

(316)

503

(288)

(Increase)/decrease in prepayments

(2)

433

455

(Increase)/decrease in interest accrued

1,850

1,841

Increase/(decrease) in payables

941

(2,749)

963

(2,161)

Increase/(decrease) in net GST

(316)

577

194

414

Increase/(decrease) in revenue received in advance

300

(19)

280

–

Increase/(decrease) in tauira fees

148

–

Increase/(decrease) in provision for kaimahi entitlements

390

187

264

196

1,874

(302)

2,148

101

12,826

9,926

12,893

9,782

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 inventories (Increase)/decrease in tauira and other receivables

Net movement in working capital Net cash inflow(outflow) from operating activities Explanations of major variances against budget are provided in note 25. The accompanying notes form an integrated part of these financial statements.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements

1. Statement of accounting policies for the year ended 31 December 2017 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.

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. Measurement base The financial statements have been prepared on a historical cost basis except where modified by the revaluation of artwork, land and buildings. 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 functional currency of the Entity and its subsidiaries and associate is New Zealand dollars. 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.

The financial statements of Te Wānanga o Aotearoa and group are for the year ended 31 December 2017. The financial statements were authorised for issue on 26 April 2018 by Te Mana Whakahaere.

Changes in accounting policies and estimates These accounting policies have been consistently applied in the periods covered by these financial statements.

2. Summary of significant accounting policies

Standards, amendments, and interpretations issued that are not yet effective and have not been early adopted Standards, amedments, and interpretations issued but not yet effective that have not been early adopted, and which are relevant to the Entity and Group, are:

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 2017, unless otherwise stated.

››

Impairment of Revalued Assets

In April 2017, the XRB issued Impairment of Revalued Assets, which now scopes in revalued property, plant

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 plans to apply this new standard for annual periods beginning on 1 January 2019.

2.3 Goods and Services Tax (GST)

››

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.

Financial instruments

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.

In January 2017, the XRB issued PBE IFRS 9 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 The net GST paid to or received from the IRD, including 2021, with early application permitted. The main changes the GST relating to investing and financing activities, is under PBE IFRS 9 are: classified as an operating cash flow in the statement of cash flows. ›› New financial asset classification requirements for determining whether an asset is measured at fair value Commitments and contingencies are disclosed exclusive or amortised cost. of GST. ››

››

A new impairment model for financial assets based on expected losses, which may result in the earlier recognition of impairment losses. Revised hedge accounting requirements to better reflect the management of risks.

Te Wānanga o Aotearoa plans to apply this standard in preparing the 31 December 2021 financial statements. Te Wānanga o Aotearoa and group has not yet assessed the effects of the new standard. 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.

2.4 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

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Wānanga o Aotearoa accounts for the funding as a capital contribution directly in accumulated funds. Estimation of useful lives of assets: The estimation of the useful lives of assets has been based on historical experience as well as 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.

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.

Property revaluations:

Rental revenue Rental revenue is recognised in the surplus or deficit on an accrual basis.

Note 13 provides information about the estimates and assumptions exercised in the measurement of revalued land and buildings.

Interest revenue Interest revenue is recognised using the effective interest method.

Early childhood centre grant:

Contract revenue Certain contract revenue is accounted for as an exchange transaction and is recognised on percentage of completion basis.

Te Wānanga o Aotearoa received a 2008 grant from the Crown for the construction of a new early childhood learning centre facility at Mangere. There are a number of conditions attached to this grant, which include the condition to repay all or part of the grant should Te Wānanga o Aotearoa cease to operate, close or sell the facility prior to 28 March 2018. Accounting for the revenue from this grant is not clear under PBE IPSAS 23 Revenue from Non-Exchange Transactions. Te Wānanga o Aotearoa has recognised the funds as a liability and releases the liability to revenue on a straight line basis during the period from 2008 to 28 March 2018. Te Wānanga o Aotearoa considers it is continuously proportionally satisfying the conditions of the grant while the facility remains in operation. 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.

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 completion as a percentage. 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 nonexchange 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 (SAC) funding SAC funding is Te Wānanga o Aotearoa 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

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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. Revenue from other government grants is considered non-exchange and is recognised based on the stage of the completion of the project. The stage of completion is measured based on the percentage of costs incurred to date compared to the total estimated costs to complete the full project. When funding is received in advance of the project being completed, deferred revenue is recognised and is released over the specific period using the stage of completion method. 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 Research grants are considered non-exchange which provide reciprocal benefits to the research funding provider that can extend over balance dates. Research grants are usually subject to a contract for services which sets out the outputs expected and includes a payment schedule. Each research grant is recorded as a separate contract in the consolidated entity's financial records. At balance date the aggregate balance of research projects for which research grant funding received exceeds costs incurred to date is recorded in the statement of financial position as a liability, being a future obligation to complete research.

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

133,358

132,049

133,358

132,049

1,632

1,720

1,632

1,720

Government funding Student Achievement Component funding Other government funding Total government funding

134,990 133,769 134,990 133,769

Tauira fees Fees from domestic tauira

4,734

5,206

4,734

5,206

Fees from international tauira

1,366

1,328

–

Total tauira fees

6,100

6,534

4,734

5,206

Interest revenue

2,813

2,931

2,746

2,855

Total interest revenue

2,813

2,931

2,746

2,855

7,117

7,386

6,916

7,114

265

285

261

285

Donation from DynaSpeak Limited

–

3,500

–

Dividends from external sources

5,380

5,687

4,842

5,379

12,766

13,362

15,522

12,781

156,669 156,596

157,992

154,611

Other revenue Contract revenue* Profit on sale of property, plant, equipment and assets held for sale

Miscellaneous revenue Total other revenue Total revenue

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Revenue classified as exchange or non-exchange transactions Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Fees from international tauira

1,366

1,328

–

Contract revenue*

3,603

4,326

3,402

4,054

265

285

261

285

2,813

2,931

2,746

2,855

Miscellaneous revenue

1,121

1,231

583

923

Total revenue from exchange transactions

9,172

10,105

6,995

8,120

133,358

132,049

133,358

132,049

Other government funding

1,632

1,720

1,632

1,720

Fees from domestic tauira

4,734

5,206

4,734

5,206

–

3,500

–

Miscellaneous revenue

4,259

4,456

4,259

4,456

Contract revenue

3,514

3,060

3,514

3,060

Total revenue from non-exchange transactions

147,497

146,491

150,997

146,491

Total exchange and non-exchange

156,669

156,596

157,992

154,611

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

90,663

90,680

86,467

86,450

Employer contributions to defined contribution plans*

1,886

1,836

1,800

1,742

Increase/(decrease) in employee entitlements

(161)

133

(260)

153

Capitalised internal labour

(3,128)

(2,580)

(3,128)

(2,580)

Total kaimahi costs

89,260

90,069

84,879

85,765

Revenue from exchange transactions

Profit on sale of property, plant and equipment Interest revenue Dividends from external sources

Revenue from non-exchange transactions Student Achievement Component funding

Donation from DynaSpeak Limited

* Contract revenue relates to licences and subcontracting arrangements.

4. Kaimahi costs

Wages and salaries

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

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

5. Other expenses

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Audit fees for financial statements audit (Audit NZ)

223

258

217

207

Audit fees for internal audits (other service providers)

114

121

Administration

14,006

14,282

12,402

12,484

Contract tutors

7,327

6,925

7,327

6,925

Note

Fees to auditor

Impairment/(impairment reversal) of receivables

–

(66)

–

(66)

Bad debts written off

692

191

692

191

380

308

378

308

1,664

1,931

1,664

1,931

Intercompany expenses

–

9,236

6,628

Small capital purchases

487

836

476

784

Consultancy fees

2,223

2,990

2,205

2,975

Tauira resources

10,762

10,461

10,670

10,327

Travel

1,777

2,095

1,743

2,007

Occupancy expenses

6,783

6,629

6,503

6,277

Rent

2,178

2,329

886

1,048

Minimum lease payments – operating lease

4,299

4,008

4,299

4,008

641

325

641

325

53,586

53,603

59,490

56,460

Sponsorship and koha Satellite payments

Impairment of intangibles, inventory and PPE Loss on sale Total other expenses

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

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Cash at bank and in hand

5,828

8,926

5,445

8,362

Total cash and cash equivalents

5,828

8,926

5,445

8,362

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 organisation and group at 31 December 2017 (2016: nil).

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

704

939

704

939

(149)

555

790

555

790

1,395

1,782

1,386

1,761

900

995

868

965

–

11,301

11,166

11,301

11,166

13,596

13,943

13,556

13,923

–

14,151

14,733

14,111

14,713

1,038

1,164

1,006

1,134

Receivables from non-exchange transactions

13,113

13,569

13,105

13,579

Total receivables

14,151

14,733

14,111

14,713

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

Less: provision for impairment Gross debtors and other receivables Total receivables above comprise: Receivables from exchange transactions

(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 (2016: nil).

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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

2017 Impairment $'000

Net $'000

Gross $'000

2016 Impairment $'000

Net $'000

13,292

–

13,292

13,211

–

13,211

–

129

–

129

Past due 61-120 days

(17)

–

(17)

388

–

388

Past due > 120 days

967

(149)

818

1,154

(149)

1,005

14,300

(149)

14,151

14,882

(149)

14,733

13,259

–

13,259

13,197

–

13,197

–

129

–

129

Past due 61-120 days

(17)

–

(17)

382

–

382

Past due > 120 days

960

(149)

811

1,154

(149)

1,005

(149)

14,111

14,862

(149)

14,713

Gross $'000

Group Not past due Past due 1-60 days

Total

Parent Not past due Past due 1-60 days

Total

14,260

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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

At 1 January

149

215

149

215

Additional provisions made during the year

692

125

692

125

(692)

(191)

(692)

(191)

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 — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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.

Inventories held for distribution Work in progress Total inventory

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

1,907

1,695

1,905

1,686

176

220

176

220

2,083

1,915

2,081

1,906

The carrying amount of inventories for distribution are measured at cost as at 31 December 2017 and therefore, the carrying amount at current replacement cost is nil (2016: nil). Inventories are made up of consumables and inventories held for distribution to Takiwā. 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 2017 is $4.9m (2016: $4.0m) and parent 2017 is $4.8m (2016: $3.9m). 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 $0.2m in 2017 (2016: $0.08m). There have been no reversals of write downs in 2017 (2016: nil). No inventories are pledged as security for liabilities (2016: nil).

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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. The Entity 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 — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

9. Other financial assetts (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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Term deposits with maturities <12 months

69,085

61,050

67,000

59,000

Total current portion

69,085

61,050

67,000

59,000

–

69,085

61,050

67,000

59,000

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 3.64% (2016: 4.23%). Impairment There were no impairment provisions for other financial assets. None of the financial assets are either past due or impaired.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Trade payables

2,575

2,684

2,406

2,478

Accrued expenses

2,464

1,991

2,397

1,840

300

–

280

–

5,339

4,675

5,083

4,318

–

625

742

Other government funding

990

487

990

487

Early childcare centre grant

Taxes payable (GST, PAYE)

3,099

3,538

2,905

2,827

Total

4,105

4,091

4,536

4,122

Total current portion

9,444

8,766

9,619

8,440

–

Early childcare centre grant

–

Total non-current portion

–

9,444

8,782

9,619

8,456

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

Non-current portion Payables and deferred revenue under exchange transactions: Payables and deferred revenue under non-exchange transactions:

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 20.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 Actual 2017 $'000

Group Actual 2016 $'000

Parent Actual 2017 $'000

Parent Actual 2016 $'000

Accrued salaries

2,135

1,586

2,041

1,518

Annual leave

5,084

5,196

4,770

4,975

355

403

347

401

7,574

7,185

7,158

6,894

–

7,574

7,185

7,158

6,894

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.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Lease make-good

Total current portion

Non-current portion Lease make-good

330

206 258

147

Total non-current portion

330

206

258

147

Total lease make-good

418

304

336

225

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Balance at 1 January

304

308

225

239

Additional provisions

124

111

–

(15)

–

(15)

Unused amounts reversed

(10)

(54)

–

(54)

Balance at 31 December

418

304

336

225

Movements for lease make-good provisions are as follows:

Amounts used

In respect of a number of leased premises, Te Wānanga o Aotearoa is required at the expiry of the lease term to make good 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 2019, April 2019, November 2020, December 2020 and May 2022. Information about Te Wānanga o Aotearoa leasing arrangements are disclosed in note 23.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 and buildings 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 off cycle 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 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 Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

(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 1-50 years

Depreciation rates 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 Wānanga o Aotearoa has contracted to lease the asset together with any further terms for which Te Wānanga 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.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

13. Property, plant and equipment (continued)

Group 2017 Land $'000

Buildings $'000

Leasehold Improvements $'000

27,415

53,954

7,433

Additions

–

1,248

337

Disposals

–

(19)

(24)

Reclassification

–

Impairment charge recognised in profit and loss

–

(212)

27,415

55,183

7,534

Balance as at 1 January 2017

–

(4,025)

(3,117)

Disposals

–

Impairment charge recognised in profit and loss

–

Depreciation charge

–

(4,162)

(524)

Closing accumulated depreciation as at 31 December 2017

–

(8,187)

(3,546)

Net book value at 1 January 2017

27,415

49,929

4,316

Net book value at 31 December 2017

27,415

46,996

3,988

Land $'000

Buildings $'000

Leasehold Improvements $'000

27,415

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

53,954

7,072

Additions

–

1,248

337

Disposals

–

(19)

(24)

Reclassification

–

Impairment charge recognised in profit and loss

–

(212)

55,183

7,173

(2,901)

Closing cost at 31 December 2017

27,415

Accumulated depreciation

Balance as at 1 January 2017

–

(4,025)

Disposals

–

Impairment charge recognised in profit and loss

–

Depreciation charge

–

(4,162)

(494)

Closing accumulated depreciation at 31 December 2017

–

(8,187)

(3,300)

Net book value 1 January 2017

27,415

49,929

4,171

Net book value at 31 December 2017

27,415

46,996

3,873

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Furniture & Equipment $'000

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

3,989

2,092

4,552

10,370

3,548

7,311

839

528

122,031

649

234

1,917

578

–

4,295

9,364

–

(1,575)

–

(940)

(121)

–

(2,679)

–

(3,856)

–

(3,199)

–

(3,411)

4,638

2,326

6,469

9,373

3,588

3,238

718

967

121,449

(1,790)

(1,849)

(2,645)

(6,498)

–

(5,207)

(582)

–

(25,713)

–

1,523

–

940

121

–

2,584

–

3,131

–

3,226

(648)

(272)

(807)

(1,506)

–

(408)

(35)

–

(8,362)

(2,438)

(2,121)

(3,452)

(6,481)

–

(1,544)

(496)

–

(28,265)

2,199

243

1,907

3,872

3,548

2,104

257

528

96,318

2,200

205

3,017

2,892

3,588

1,694

222

967

93,184

Furniture & Equipment $'000

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

3,690

2,092

4,363

10,263

3,548

7,306

839

528

121,070

638

234

1,890

578

–

4,295

9,325

–

(1,560)

–

(939)

(121)

–

(2,663)

–

(3,856)

–

(3,199)

–

(3,411)

4,328

2,326

6,253

9,281

3,588

3,233

718

967

120,465

(1,598)

(1,849)

(2,491)

(6,408)

–

(5,206)

(582)

–

(25,060)

–

1,507

–

940

120

–

2,567

–

3,131

–

3,226

(610)

(272)

(783)

(1,490)

–

(407)

(34)

–

(8,252)

(2,208)

(2,121)

(3,274)

(6,391)

–

(1,542)

(496)

–

(27,519)

2,092

243

1,872

3,855

3,548

2,100

257

528

96,010

2,120

205

2,979

2,890

3,588

1,691

222

967

92,946

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

13. Property, plant and equipment (continued)

Group 2016 Cost Balance as at 1 January 2016

Land $'000

Buildings $'000

Leasehold Improvements $'000

27,085

50,352

7,237

Additions

–

2,382

196

Disposals

–

Reclassification

330

1,220

–

27,415

53,954

7,433

Balance as at 1 January 2016

–

(12)

(2,544)

Disposals

–

Depreciation charge

–

(4,013)

(573)

Balance as at 31 December 2016

–

(4,025)

(3,117)

Net book value at 1 January 2016

27,085

50,340

4,693

Net book value at 31 December 2016

27,415

49,929

4,316

Land $'000

Buildings $'000

Leasehold Improvements $'000

27,085

50,352

6,933

Additions

–

2,382

139

Disposals

–

Closing cost at 31 December 2016

Accumulated depreciation

Parent 2016 Cost Balance as at 1 January 2016

Assets classified as held for sale and other disposals

330

1,220

–

27,415

53,954

7,072

Balance as at 1 January 2016

–

(11)

(2,353)

Disposals

–

Depreciation charge

–

(4,014)

(548)

Balance as at 31 December 2016

–

(4,025)

(2,901)

Net book value at 1 January 2016

27,085

50,341

4,580

Net book value at 31 December 2016

27,415

49,929

4,171

Balance as at 31 December 2016

Accumulated depreciation

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Virtual Learning ComFurniture & Equipment puters $'000 $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

3,034

2,048

2,588

9,997

3,521

7,041

783

1,738

115,424

970

1,964

1,273

270

1,387

8,569

(15)

–

(900)

–

(915)

–

(2,597)

(1,047)

3,989

2,092

4,552

10,370

3,548

7,311

839

528

122,031

(1,302)

(1,559)

(2,020)

(5,854)

–

(4,698)

(554)

–

(18,543)

–

863

–

863

(488)

(290)

(625)

(1,507)

–

(509)

(28)

–

(8,033)

(1,790)

(1,849)

(2,645)

(6,498)

–

(5,207)

(582)

–

(25,713)

1,732

489

568

4,143

3,521

2,343

229

1,738

96,881

2,199

243

1,907

3,872

3,548

2,104

257

528

96,318

Furniture & Equipment $'000

Virtual Learning Computers $'000

Computers $'000

Motor Vehicles $'000

Artwork $'000

Library $'000

Waka $'000

Work in Progress $'000

Total $'000

2,757

2,048

2,397

9,890

3,521

7,034

783

1,738

114,538

948

1,966

1,274

272

1,387

8,495

(15)

–

(901)

–

(916)

–

(2,597)

(1,047)

3,690

2,092

4,363

10,263

3,548

7,306

839

528

121,070

(1,169)

(1,559)

(1,903)

(5,783)

–

(4,697)

(554)

–

(18,029)

–

863

–

863

(429)

(290)

(588)

(1,488)

–

(509)

(28)

–

(7,894)

(1,598)

(1,849)

(2,491)

(6,408)

–

(5,206)

(582)

–

(25,060)

1,588

489

494

4,107

3,521

2,337

229

1,738

96,509

2,092

243

1,872

3,855

3,548

2,100

257

528

96,010

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017 13. Property, plant and equipment (continued) Valuation The most recent valuation of land and buildings were performed by independent valuers, Jones Lang LaSalle as at 31 December 2015. Land Land is valued at fair value using market-based evidence based on its highest and best use with reference to comparable land values.

›› If there is no active market, fair value is determined by other market based evidence adjudged by active and knowledgeable participants in the market. 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. Buildings Specialised buildings (for example, campuses) are ›› Property, plant and equipment pledged valued at fair value using depreciated replacement as security for liabilities. cost as no reliable market data is available for buildings designed for education delivery purposes. ›› Compensation for items of property, plant and equipment that were impaired, lost or given up. Depreciated replacement cost is determined using a number of significant assumptions. Leasing Significant assumptions include: The net carrying amount of property, plant and ›› The replacement asset is based on the equipment held under finance leases is nil (2016: nil). replacement with modern equivalent assets with adjustments where Impairment appropriate for obsolescence due to over design or surplus capacity. Impairment losses of $0.1m (2016: nil) have been recognised for leasehold improvements due to no ›› The replacement cost is derived longer being in our current property portfolio or the from recent construction contracts of improvement no longer exists. Impairment losses similar assets and Property Institute of $0.07m (2016: nil) have been recognised for of New Zealand cost information. library books due to no longer being in our current library collection. The impairment loss has been ›› The remaining useful life of recognised in the statement of comprehensive revenue assets is estimated. and expense in the line item "Other expenses". ››

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

Work in progress The value of work in progress is disclosed at cost by class of asset as follows:

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, James Parkinson of Art and Object on 7 September 2015. The valuation was undertaken in accordance with PBE IPSAS 17 using fair value and is effective as at 31 December 2015. 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.

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Equipment

550

303

550

303

Computers

Buildings

408

121

408

121

Waka

–

Library books

–

996

528

996

528

Class

Total

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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.

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 2016 Software $'000

Programme Development $'000

Work in Progress $'000

Total $'000

1,867

3,443

1,594

6,904

658

598

5,105

6,361

–

114

(2,512)

(2,398)

Impairment (net)

(158)

(84)

–

(242)

Amortisation

(673)

(1,599)

–

(2,272)

Closing net book value

1,694

2,472

4,187

8,353

4,346

10,048

4,187

18,581

(2,652)

(7,576)

–

(10,228)

1,694

2,472

4,187

8,353

Year ended 31 December 2016 Opening net book value Additions Reclassification

At 31 December 2016 Cost Accumulated amortisation and impairment Net book value

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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)

Amortisation

(753)

(1,545)

–

(2,298)

Closing net book value

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)

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

100

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

14. Intangible assets (continued)

Parent 2016 Software $'000

Programme Development $'000

Work in Progress $'000

Total $'000

1,781

3,314

1,439

6,534

640

598

5,008

6,246

–

(2,397)

Impairment (net)

(158)

(84)

–

(242)

Amortisation

(648)

(1,527)

–

(2,175)

Closing net book value

1,615

2,301

4,050

7,966

4,214

9,750

4,050

18,014

(2,599)

(7,449)

–

(10,048)

1,615

2,301

4,050

7,966

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 2016 Opening net book value Additions Reclassification

At 31 December 2016 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

101

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

There are no restrictions over the title of Te Wānanga o Aotearoa intangible assets, nor are any intangible assets pledged as security for liabilities. Te Wānanga o Aotearoa impaired intangible assets of $0.26m in 2017 for the group and parent. (2016: $0.24m 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. Work in progress The value of work in progress is disclosed at cost by class of asset as follows: Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

246

465

141

368

Programme development

4,745

3,722

4,675

3,682

Total

4,991

4,187

4,816

4,050

Class Software

102

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

156,794

154,175

154,830

152,513

3,163

2,619

3,160

2,317

159,957

156,794

157,990

154,830

Balance at 1 January

18,684

Balance at 31 December

18,684

17,029

1,655

18,684

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

Property revaluation reserve Property revaluation reserves for each asset class consist of: Land Buildings Total

103

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Capital management The capital of Te Wānanga o Aotearoa is its net assets/equity, which comprises 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 2017. 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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Shares in DynaSpeak Limited (cost)

–

475

Total investment in subsidiaries

–

475

Country of Incorporation

DynaSpeak Limited

New Zealand

Equity Interest

Investment

2017 %

2016 %

2017 $'000

2016 $'000

100

475

Total investment in subsidiaries

Te Wānanga o Aotearoa has 100% control over Aotearoa Scholarship Trust (2016: 100%)

104

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

17 . Investment property Accounting policy Properties leased to third parties under operating leases are classified as an investment property unless the property is held to meet service delivery objectives, rather than to earn rentals or for capital appreciation. Property held to meet service delivery objectives is classified as property, plant and equipment. Investment property is measured initially at its cost, including transaction costs. After initial recognition, investment property is measured at fair value as determined annually by an independent valuer. Gains or losses arising from a change in the fair value of investment property are recognised in the surplus or deficit.

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Balance at 1 January

–

1,550

–

1,550

Investment properties - at fair value - transfer (to) owner-occupied property

–

(1,550)

–

(1,550)

Balance at 31 December

–

In 2017 the property remained occupied by its owner.

105

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

18. Early learning centres During 2017, Te Wānanga o Aotearoa received total grants of $2.4m from the Ministry of Education for early learning purposes (2016: $2.7m). These grants have been classified as non-exchange revenue.

2017 $'000

2016 $'000

461

470

466

475

Salaries

466

475

Total funds applied

466

475

422

405

Low socio-economic

Special needs

458

438

454

438

458

438

515

652

Low socio-economic

Special needs

565

709

Apakura Te Kākano Bulk funding Language and kaupapa Total Ministry of Education funding received

Funds applied to:

Nga Kākano o te Manukau Bulk funding

Language and kaupapa Total Ministry of Education funding received

Funds applied to: Salaries Provision of meals for tamariki Total funds applied

Te Rau Oriwa Bulk funding

Language and kaupapa Total Ministry of Education funding received

106

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Te Rau Oriwa (continued)

2016 $'000

2017 $'000

Funds applied to: 565

599

Faculty support

–

Resources

–

Property occupancy costs

–

Provision of meals for tamariki

–

-–

565

709

508

583

Low socio-economic

Special needs

537

616

537

554

Faculty support

–

Property occupancy costs

–

Resources

–

Provision of meals for tamariki

–

537

616

315

450

343

486

Salaries

343

486

Total funds applied

343

486

Salaries

Capital expenditure (verandah roof) Total funds applied

Raroera Te Puawai Bulk funding

Language and kaupapa Total Ministry of Education funding received

Funds applied to: Salaries

Total funds applied

Whare Amai Bulk funding Low socio-economic Special needs Total Ministry of Education funding received

Funds applied to:

107

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

19. 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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

5,828

8,926

5,445

8,362

Tauira and other receivables

14,151

14,733

14,111

14,713

Term deposits

69,085

61,050

67,000

59,000

Total loans and receivables

89,064

84,709

86,556

82,075

Creditors and other payables

9,444

8,782

9,619

8,456

Total financial liabilities at amortised cost

9,444

8,782

9,619

8,456

Loans and receivables Cash and cash equivalents

Financial liabilities at amortised cost

(b) 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. 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.

108

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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. 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. 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. 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 group's 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.

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

69,913

58,976

67,445

56,362

–

11,000

–

11,000

5,000

–

5,000

–

74,913

69,976

72,445

67,362

Existing counterparty with no defaults in the past

14,151

14,733

14,111

14,713

Total debtors and other receivables

14,151

14,733

14,111

14,713

Total financial instrument assets

89,064

84,709

86,556

82,075

Counterparties with credit ratings Cash at bank and term deposits AAA+ A Total cash at bank and term deposits Counterparties without credit ratings Tauira and other receivables

109

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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

1-2 Years $'000

2-5 Years $'000

More than 5 Years $'000

Group 2017 Payables

9,444

–

Accrued salaries

2,135

–

11,579

–

Payables

8,782

8,766

–

Accrued salaries

1,586

–

10,368

10,352

–

Total

Group 2016

Total

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

Parent 2017 Payables

9,619

–

Accrued salaries

2,041

–

11,660

–

Payables

8,456

8,440

–

Accrued salaries

1,518

–

Total

9,974

9,958

–

Total

Parent 2016

110

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 2017 5,828

5,828

–

14,151

–

– Term deposits

69,085

–

Total

89,064

–

8,926

–

14,733

–

– Term deposits

61,050

–

Total

84,709

–

Cash and cash equivalents Tauira and other receivables Other financial assets

Group 2016 Cash and cash equivalents Tauira and other receivables Other financial assets

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

Parent 2017 5,445

5,445

–

14,111

–

– Term deposits

67,000

–

Total

86,556

–

8,362

–

14,713

–

– Term deposits

59,000

–

Total

82,075

–

Cash and cash equivalents Tauira and other receivables Other financial assets

Parent 2016 Cash and cash equivalents Tauira and other receivables Other financial assets

111

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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. 2017 -100bps Surplus $'000

-100bps Other Equity $'000

2017 +100bps Surplus $'000

+100bps Other Equity $'000

2016 -100bps Surplus $'000

-100bps Other Equity $'000

2016 +100bps Surplus $'000

+100bps Other Equity $'000

Group Interest rate risk – financial assets (58)

–

(89)

–

Other financial assets

(691)

–

691

–

(611)

–

611

–

Total sensitivity to interest rate risk

(749)

–

749

–

(700)

–

700

–

(54)

–

(84)

–

Other financial assets

(670)

–

670

–

(590)

–

590

–

Total sensitivity to interest rate risk

(724)

–

724

–

(674)

–

674

–

Cash and cash equivalents*

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%. 20. 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 condition 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 2017. 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. In 2016, Te Wānanga o Aotearoa invoiced DynaSpeak Limited for a management fee of $0.2m to recover overhead costs in respect of support services provided to DynaSpeak Limited during the year. This included accounting, transaction processing, payroll, human resources and information technology support. In 2017 the management fee was removed. The management fee received in 2016 by Te Wānanga o Aotearoa is disclosed in note 3, and is included in miscellaneous revenue.

112

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

21. 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

–

Dr Kathie Irwin

Council

Apr-14

–

Steve Ruru

Council / Audit & Risk

Jun 10

–

Jon Stokes

Council

Dec 16

–

Josh Wharehinga

Council / Academic Board

Jul-15

–

Independent members of other committees Ainsleigh Cribb-Su'a

Academic Board

Dec-15

–

Gary Dyall

Audit & Risk

Aug-11

–

Wayne McLean

Audit & Risk Chair

Jul-08

–

Hinerangi Raumati-Tu'ua

Investment Committee

Jan-16

–

Christopher Tooley

Academic Board

Dec-15

–

Sam Inglis

Investment Committee

May-17

–

Anaru Baynes

Academic Board

Sep-17

–

Richard Batley

Council

Aug-04

Oct-16

–

The late Rea Wikaira

Council/Audit & Risk

Aug-13

Nov-16

Te Mana Whakahaere (Previous) –

213

205

113

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Key management kaimahi and governance remuneration:

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

Short-term and kaimahi welfare benefits Other long-term benefits – KiwiSaver Total

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

2,765

2,664

2,496

2,388

213

205

213

205

2,978

2,869

2,709

2,593

Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

2,910

2,805

2,649

2,537

2,978

2,869

2,709

2,593

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 2017

Group 2016

Parent 2017

Parent 2016

Ngā Tumu/ senior management

Te Mana Whakahaere and sub-committees

Total

To detemine management kaimahi numbers for Ngā 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.

114

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

22. Contingencies Contingent liabilities Litigation Te Wānanga o Aotearoa have two legal claims outstanding as at balance date (2016: two). These claims relate to legal disputes with external parties. Te Wānanga o Aotearoa has not disclosed the details of these claims as it may seriously prejudice the position of Te Wānanga o Aotearoa with respect to disputes with other external parties. Financial guarantee Te Wānanga o Aotearoa has no financial guarantees in place as at balance date (2016: nil). Contingent assets Te Wānanga o Aotearoa has no contingent assets as at balance date (2016: nil). 23. 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. Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Buildings

Total capital commitments

Class of asset

115

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

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 one and seven 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: Group 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Within one year

4,558

4,667

3,526

3,834

After one year and not later than five years

5,703

7,410

5,019

6,317

Later than five years Total non-cancellable operating leases

833

1,338

833

1,338

11,094

13,415

9,378

11,489

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 2017 $'000

Group 2016 $'000

Parent 2017 $'000

Parent 2016 $'000

Within one year

172

156

172

156

After one year and not later than five years

157

Total non-cancellable operating leases

329

246

329

246

No contingent rents have been recognised in the statement of financial performance during the period.

116

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

24. Events after the balance date There are no events after balance date (2016: nil). 25. Explanation of major variances against budget Accounting policy 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. Explanations for major variations from Te Wānanga o Aotearoa group budget figures are as follows: Statement of comprehensive revenue and expense The Group achieved a surplus of $3.2m (2.0% of total revenue), which is $1.6m below budget of $4.8m (3.0% of total revenue). Government funding was $3.3m below budget. A number of plan amendments were agreed by TEC including: the level 1 and level 2 competitive fund $2.5m this mainly related to Corrections, Youth Guarantee $1.2m, this was offset by an adjustment of $0.6m to the level 1 and 2 non-competitive fund. Tauira fees are $0.9m below budget due to tauira choosing to enrol in non-fee paying programmes. Interest revenue is $0.5m above budget, this is the result of improved cash flow management and to a lessor extent slightly higher interest rate than what was budgeted. Other revenue was $1.3m below budget, of which $0.9m relates to a drop of EFTS achieved through the Southern Institute of Technology contract. Additionally, income from the Early Learning Centres (ELC) was $0.4m less than budgeted due to lower enrolments as other early childcare facilities are opening in areas where our ELC's operate in. Kaimahi costs are below budget $3.2m due to vacancies and delays in filling positions. This is partially offset by an overspend of $1.3m in contract tutorial in other expenses. Training and development uptake was less than planned, additionally various training initiatives had been deferred. Depreciation and amortisation was $2.0m below budget due to delay in capital spend and a number of projects being deferred. Other expenses were $1.8m above budget. An additional $0.7m was spent on student resources, the result of extra resources being required for some programmes over and above what was budgeted. Bad debts are $0.7m above budget as we recognise that prior years' uncollectable debtor balances have impacted the current year. Contract tutorial was $1.3m above budget, offset by Academic Salaries within the Kaimahi costs being $1.3m below budget.

117

Te Wānanga o Aotearoa — Annual Report 2017

Notes to the financial statements For the year ended 31 December 2017

Statement of financial position Tauira and other receivables were $10.8m higher than budget, mainly due to the SAC funding being recognised based on when the course withdrawal date has passed, and number of eligible students who have enrolled at that time. This had not been provided for in the budget. Other financial assets is $7.0m above budget due to more term deposits being placed at year end which is a function of less than budgeted capex spend. Assets held for sale is $0.7m below budget as the asset had been sold during the year. Property, plant & equipment of $93.1m were less than budget by $8.5m. Mainly due to several property projects that have been cancelled or delayed. Creditors and other payables were $0.4m lower than budget as the result of lower capital spend than expected. Kaimahi entitlements was $1.3m lower than budget, as annual leave balances were less than anticipated due to proactive management of high leave balances. Equity was $9.2m more than budget. In 2017, an adjustment was made to SAC funding to being recognised based on when the course withdrawal date has passed, and number of eligible students who have enrolled at that time. This had not been provided for in the budget but provided an additional $10.8m in revenue. This is offset by a $1.6m below budget deficit in the statement of financial performance. Statement of cash flows Government funding was $2.9m below budget. A number of plan amendments were agreed by TEC including: the level 1 and level 2 competitive fund $2.5m this mainly related to Corrections, Youth Guarantee $1.2m, this was offset by an adjustment of $0.6m to the level 1 and 2 non-competitive fund. Payments to kaimahi was $3.3m below budget and payments to suppliers were $3.5m above budget. These two variances offset as tutorial costs were contracted out whereas the budget assumed that kaimahi will bear this cost. The acquisition of property, plant & equipment was $6.8m less than budget due to several property projects that have been cancelled or delayed. Programme development was $3.7m less than budget due to several of the developments being delayed and deferred to 2018.

118

Te Wānanga o Aotearoa — Annual Report 2017

Hei whakamaumahara

In rememberance

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 – those of us who have been left behind – 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.

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