ANNUAL REPORT
2018
DIRECTORS
President: Ian McCann
Vice President: Adam Cromack
Alan Fowler
Justin Isaacs
Trevor Simpson
Laurie Capovilla
OAM
Robert Willis
George Mumford
OFFICE BEARERS HONORARY LIFE MEMBERS
MANAGEMENT
L. L. Rigby
1980
Deceased
Chief Executive Officer
Glenn Kovacs
W. L. Archer
1981
Deceased
R. A. McIntosh
1982
Deceased
Chief Financial Officer
Nicole Pearce
R. L. Collison
1982
Deceased
Interim Gaming Manager
Christie Wheeler
R. N. Downing
1984
J. R. Scott
1986
Deceased Deceased
Information Technology Communications Manager
Colin Dunbar
R. R. Howard
1987
Facilities Manager
Paul Felice
T. P. Donoghue
1988
Deceased
Human Resources Manager
Rebecca Green
W. F. Webster OAM 1991
Deceased
D. R. Cromack
1992
K. F. Darke
1992
B. J. Doyle
1993
Deceased Deceased Deceased
Auditors
KPMG
R. L. Mavin
1995
Bankers
Commonwealth Bank of Australia
J. Felstead
1999
Deceased
L. Capovilla
1999
Solicitors
Frank Legal
N. Stoddart T. Simpson
1999
Australia and New Zealand Banking Group
Deceased
2001
OAM
B. Bowman
2002
Deceased
A. Downing
2009
Deceased
A. Branson
2011
J. Stephenson
2013
61 st ANNUAL REPORT 2018 WENTWORTHVILLE LEAGUES CLUB LIMITED - ABN 25 000 244 459 50 Smith St, Wentworthville NSW 2145 Phone: 02 8868 9200 Fax: 02 8868 9290 Email: info@wentyleagues.com.au 1 www.wentyleagues.com.au
Wentworthville Leagues Club Limited Contents
President report
1
Chief executive officer's report
2
Constitutional reporting
3
Directors' report
5
Lead auditor's independence declaration
10
Independent auditor's report
11
Directors' declaration
14
Statement of profit or loss and other comprehensive income
15
Statement of financial position
16
Statement of changes in members' funds
17
Statement of cash flows
18
Notes to the financial statements
19
President’s Report Dear Members, On behalf of the Board I am pleased to submit to members the 61st Annual Report of Wentworthville Leagues Club. Despite extensive redevelopments the Club is undergoing, revenue in 2018 was $65.6 million and the profit before tax was $5.3 million. Over the year, loss of disposal of fixed assets was $1.5 million. This is a testament to the efforts of the team at Wenty Leagues and the continued support of our valued members. Overall, the Master Plan is progressing exceptionally well. Throughout the year we reached many significant milestones including the delivery of new administration, staff and back-of-house amenities, improved loading dock facilities, a six-level multideck carpark with 780 carparking spaces and a new multi-outlet casual dining precinct, The Plaza. In the coming months we will proceed further into our Master Plan as construction now moves to Stage B. This phase of the plan will include works on delivering premium carparking spaces, improved pedestrian access, a porte-cochere new and foyer, function centre two more specialty dining outlets. While these works continue, we are grateful for the patience and understanding shown by our members and guests as we work towards making Wenty Leagues the venue of choice for exceptional hospitality. The 2019 Annual General Meeting will be held on Sunday 26 May in the Starlight Room at 10.00am and I look forward to seeing members at this meeting where the board will report on both our strong financial growth and further updates on the Master Plan. To close, I would like to thank my fellow Board Members for their continued support and dedication to Wenty Leagues and for the highly professional manner they conduct themselves as directors. I also thank the management team for their dedication and hard work throughout the year plus I'd like to extend my thanks to the support of the families of the Board and Management Team for their understanding and patience. Finally, a warm thank you to all our sporting clubs and members for your ongoing support.
Ian McCann President
1
Chief Executive Officer’s Report Dear Members The past year has been extremely productive as the commitment and hard work of the Wenty Leagues Board and Management Team has resulted in the continued success of the Club. By working closely with our community partners throughout the year, Wenty Leagues was recognised as a finalist in 6 categories for the 2018 Clubs & Community Awards. Some of the work recognised was our staff volunteer programs with Parramatta Mission and Ronald McDonald House along with our yearly Carols on Ringrose Christmas event which raises money for Youth Off The Streets. In addition to these initiatives, our cash and in-kind contributions to projects in the local community for the year totalled over $1.3m. During this redevelopment period, membership has remained stable with 63,397 members and since the completion of Stage A, we anticipate further growth in the coming year. Our food and beverage offering maintained growth in trade through consistent offerings at Wenty Cafe and the introduction of pop-up outlets - Demolish and Easy Eats 2145 early in the year. These temporary outlets helped to provide a smooth transition while construction was underway for our multi-outlet casual dining precinct, The Plaza. Now open, our members can experience the elevated dining experience of Chefs Grill, Pizza Mama, Crave Desserts and soon to come later in 2019, Red Panda Noodles. Wenty Leagues continued to be a destination for exceptional entertainment by bringing quality performances by John Paul Young and The Allstar Band, The Angels, Diesel, Damien Leith and many more artists to the Starlight Room. Our weekly entertainment line-up also brought a variety of soloist and duo performers to the Wenty Lounge to create a lively atmosphere. Aside from great entertainment, there was also a host of promotions with some great prizes to be won. Some of which included thousands of dollars’ worth of electronics in our Treasure Thursday promotion, family holiday packages to various locations across Australia and of course our raffles with regular themed prizes to be won each week. Looking forward to another successful year, I would like to thank all our members and guests who have made Wenty Leagues their destination throughout 2018. I also wish to thank the Board of Directors for their ongoing support and the Management Team and Staff who continue to strive to provide exceptional hospitality.
Glenn Kovacs Chief Executive Officer
2
Constitutional Reporting 2018 $ Member statement of benefit (Rule 70) The apportionment of the annual profit has been appropriated for improvements to the benefit for the members. Donation - Sporting bodies Donation - Accredited incorporated sport and recreational clubs Donations - Clubgrants and other Ringrose Park & bowling greens Subsidised entertainment (non-gaming and net of revenue) Members expenses
789,740 276,699 302,116 655,741 604,277 188,883 2,817,456
Directors Honorariums (Rule 86: Allowance $57,000 + CPI) Position Name President I McCann Vice President A Cromack Director L Capovilla Director A Fowler Director J Isaacs Director G Mumford Director T Simpson OAM Director R Willis
12,871 7,275 7,275 7,275 7,275 7,275 7,275 7,275 63,798
Directors expenses In accordance with the Constitution the total value of directors expenses under Rule 87 to Rule 93 (excluding Rule 92) for the year 2018 (indexed for CPI) is $153,619 (2017: $152,009). The actual expenditure for the year of $87,620 (2017: $104,425) is $65,999 and 43% below the amount allocated for the year and a decrease of $16,806 or -16% (decrease in 2017: $11,778 or 10%) below the costs of the prior year. In accordance with the Constitution the Rule 92 Special functions and Rule 94 Club attire do not have approved amounts of expenditure but rather apply a "reasonable expenditure" test. The base year for the CPI annual increases is a combination of the adoption of the original Constitution in the year 2000 and subsequent amendments in the year 2005.
CPI Base Period Rule 87 88 89 90 91 92 93 94
Clubs NSW, Leagues Club Association and trade shows Board meetings Club, charity and community attendance Partner club, charity or community attendance Director & guest - In house dinning Annual sports, Board & AGM functions Special function - service & achievement Other expenses not specified in other rules Uniform attire
Jan-05 Jan-00 Jan-05 Jan-00 Jan-00 N/A Jan-05 N/A
Constitution Allowance $ 36,000 18,000 9,500 6,400 25,000 6,000
Approved Amount $ 50,343 29,733 13,285 10,572 41,296 8,390
100,900
153,619
Actual Expenditure $ 27,200 27,308 936 6,926 21,535 2,458 1,257 87,620
3
Constitutional Reporting Directors expenses (continued) Professional development and education (Rule 87) Clubs NSW Leagues Club Association Clubs NSW regional meetings, Gaming Expo conference and trade show and attendance other clubs.
Board meetings and community & charity attendance (Rule 88) Board meals & beverage Cab charge Club community & charity event
Partner attendance at community & charity events (Rule 89) Club community and charity events. Directors entertainment in house dining facilities (Rule 90) Special functions (Rule 91) Annual Sports & Recreation club dinner AGM Annual Board dinner
2018 $ 3,366 12,740 11,094 27,200
16,612 10,696 27,308
936 6,926
19,068 2,467 21,535
Special functions (Rule 92) Service and achievement
-
Other expenditure (Rule 93)
2,458
Club attire (Rule 94)
1,257
Aggregate sum of the 6 highest paid officers of the club (Rule 156 (b)(i)) The aggregate sum representing the annual salaries, bonuses and emoluments paid (when taken together) to the 6 highest paid Officers of the club including the CEO without reference to name or title (2017: $1,290,570) Registered members (Rule 156 (b)(ii)) The number of members registered at the end of the club's financial year (2017: $63,563)
1,268,447
63,397
4
Wentworthville Leagues Club Limited Directors' report For the year ended 31 December 2018 The directors present their report together with the financial report of Wentworthville Leagues Club Limited (the Company or the Club) for the financial year ended 31 December 2018 and the auditor’s report thereon. Directors The Directors of the Company at any time during or since the end of the financial year are: Name I McCANN President
Experience, qualifications, special responsibilities and interest in contracts Director 12 years including President 10 years. Chairman of Board’s Remuneration Committee and Property Corporate and Investment Committee, Sponsorship Committee and Disciplinary Committee. Director of Leagues Club Association. Delegate of member bodies of Clubs NSW and member of Club Directors Institute. Member of Clubs Corporate Governance Working Group, Boards Representative at Sports Council. Member of all Sporting Associations and patron of Darts Club and Cricket Club. Life member of WDRLFC. Interest in contracts - Nil
A CROMACK Vice President
Director 15 years including Vice President for 6 years. Member of Boards Remuneration Committee, Sponsorship Committee and Disciplinary Committee. and Chairman of Audit Risk and Compliance Committee. Member of member bodies of ClubsNSW and Club Directors Institute. Delegate of Leagues Club Association Alternate at Sports Council. Member of all Sporting Associations, including Life Member of WDRLFC. Interest in Contract: Platinum Electricians
A FOWLER Director
Director 8 years, including past Vice President for 2 years. Member of Board’s Audit Risk and Compliance Committee, Remuneration Committee and Sponsorship Committee. Member of Member Bodies of Leagues Club Association and Club Directors Institute. Member of all Sporting Associations. Interest in Contracts: Laing and Simmons Real Estate
L CAPOVILLA Director
Director 30 years. Honorary Life Member, Member of the Board’s Audit Risk and Compliance, Sponsorship Committee and Disciplinary Committee. Alternate at Sports Council, Delegate to Leagues Clubs Association and Member of ClubsNSW and Clubs Directors Institute. 27 years’ service Leagues Club Australia. Member of all Sporting Associations and Patron of Wenty Leagues Golf Club and Life Member of WDRLFC and WUJRLFC. Delegate of Football Club Reunion Committee. Interest in contracts - Nil
5
Wentworthville Leagues Club Limited Directors' report For the year ended 31 December 2018 Name T SIMPSON OAM Director
J ISAACS Director
Experience, qualifications, special responsibilities and interest in contracts Director 19 years. Honorary Life Member. Member of Board's Property Corporate and Investment Committee, Sponsorship Committee and Disciplinary Committee. Member of member bodies of Leagues Club Association, ClubsNSW and Club Directors Institute. Member of all Sporting Associations including,co-patron of Swimming, and co-patron and life member of Jujitsu and WUJRLFC. Recipient of Australian sports and Order of Australia medals and NSW senior achievement award. Leagues Club Australia’s Board and Managers Service Awards 15 years. Cumberland Council Citizen of the Year 2017 Recipient of the Paul Harris fellow for Holroyd Rotary. Holder of the Commonwealth Sports Medal Interest in contracts - Nil Director 10 years. Member of Board's Remuneration Committee and Audit, Risk and Compliance Committee, Sponsorship Committee and Disciplinary Committee. Member of member bodies of Leagues Club Association, ClubsNSW and Club Directors Institute. Member of all Sporting Associations including patron of Darts Club and Life member and President of Cricket Club and Member of the Monty Bennett Parks Trust. Interest in contracts - Wentworthville Leagues Cricket Club.
G MUMFORD Director
Director 12 non consecutive years. Member of Board's Property Corporate and Investment Committee, Sponsorship Committee and Disciplinary Committee. Member of the Wenty Leagues Executive Master Plan Committee. Member of member bodies of Leagues Club Association, ClubsNSW and Club Directors Institute. Member of all Sporting Associations including Life Member of Men's Bowls Club. Interest in contracts - Nil
R WILLIS Director
Director 4 years. Vice President of Cricket Club. Member of the Board's Property Corporate and Investment Committee, Sponsorship Committee and Disciplinary Committee. Member of member bodies of Leagues Club Association, ClubsNSW and Club Directors Institute. Life Member of the Cricket Club and Member of all Sporting Associations. Member of the Monty Bennett Parks Trust. Interest in contracts - Wentworthville Leagues Cricket Club
6
Wentworthville Leagues Club Limited Directors' report (continued) For the year ended 31 December 2018 SHORT AND LONG TERM OBJECTIVES To promote and encourage the sport of Rugby League in the Wentworthville district. To be the community's venue of choice, that special destination every day of the week for that memorable experience.
STRATEGY FOR ACHIEVING OBJECTIVES The objectives will be achieved through providing a value offering in product and service while increasing profitability in a quality hospitality and entertainment venue. PRINCIPAL ACTIVITIES The principal activities of the company during the course of the financial year were that of a licensed club. The purpose of the club is to promote and encourage the sport of Rugby League and to provide facilities and services to its members. ACTIVITIES IN ACHIEVING THE OBJECTIVES The principal activities provided a financial return sufficient to maintain the assets of the club, promote and encourage the sport of Rugby League in the Wentworthville district and provide, promote and develop an environment within the club directed towards good fellowship and social harmony amongst its members.
MEASUREMENT OF PERFORMANCE The entity is measured against a financial budget, a strategic plan and a set of key performance indicators that are assigned to its senior management team. In addition, research is carried out to assess the team's performance with regard to the demographic of the area and our competition. MEMBERSHIP The company is limited by guarantee and without share capital. If the company is wound up, Rule 23 of the Constitution states that each member at that time, or within one year afterwards is required to contribute a maximum of $1 each towards meeting any outstanding obligations of the company. As at 31 December 2018 there are 63,397 (2017: 63,563) current members across the following membership classes:-
Type Foundation life Honorary life Companion Life Twenty five year Fifty year Standard Concessional Staff
Number 32 6 4 2,124 292 47,202 13,665 72 63,397
RESULTS OF OPERATIONS The profit after tax for the financial year is $5,120,727 (2017: Profit $10,894,316). The decline in operating revenue has been impacted by construction activity for the Masterplan works, increase in financing cost of debt of $2,249,686 (2017: $312,226), write down in plant property and equipment of $1,305,680 (2017: $Nil) as a result of capital expenditure and impairment of investment property of $264,996 (2017: ($370,377)).
7
Wentworthville Leagues Club Limited Directors' report (continued) For the year ended 31 December 2018 RESULTS OF OPERATIONS (continued) Comparative earning position 2018 Profit after tax 5,120,727 Add: Finance costs 2,249,686 Depreciation 5,506,817 Tax expense 227,899 Loss from disposal of plant, property 1,305,680 and equipment Impairment of investment properties 264,996 Reversal of impairment on investment properties 14,675,805 Adjusted earnings
2017 10,894,316 312,226 5,618,822 541,630 (370,377) 16,996,617
DIRECTORS' MEETINGS The following table sets out the number of Director's meetings held and attended during the year. During the year, 14 board meetings were held. Under the Board's Charter for its Committee the Directors along with management combine to undertake the responsibilities of the Property Corporate and Investment Committee, Audit Risk and Compliance Committee, Sponsorship Committee, Disciplinary Committee and Remuneration Committee meetings. The directors have also attended other meetings and functions in fulfilling their duties, inclusive but not limited to industry professional bodies, sporting associations, councils and political representatives functions and sporting club committees throughout the year.
Director Ian McCann Adam Cromack Robert Willis Laurie Capovilla Alan Fowler Justin Isaacs George Mumford Trevor Simpson OAM
Board meetings and Charter Committees Available Attendance 38 37 39 28 39 39 39 27 39 31 39 29 38 36 38 35 309 262
Other meetings 22 19 28 13 9 15 14 21 141
DIRECTORS' AND EXECUTIVES' REMUNERATION Remuneration of directors is in accordance with Rule 86 of the Constitution. Details of remuneration provided to directors is as follows:Directors I McCann (President) A Cromack (Vice President) L Capovilla A Fowler J Isaacs G Mumford T Simpson OAM R Willis
Honorarium 12,871 7,275 7,275 7,275 7,275 7,275 7,275 7,275
8
Wentworthville Leagues Club Limited Directors' report (continued) For the year ended 31 December 2018 DIRECTORS' AND EXECUTIVES' REMUNERATION (CONTINUED) Officers of the company The executive's remuneration package may contain the key elements of salary, superannuation and long service leave with benefits including motor vehicles and performance based incentive scheme. In accordance with Rule 159 (b) of the Constitution, the aggregate remuneration representing the annual salaries, bonuses and emoluments provided to the 6 highest paid officers of the company is $1,268,447 (2017: $1,290,570). AUDITOR'S INDEPENDENCE DECLARATION The auditor's independence declaration is included on page 10. Signed in accordance with a resolution of the directors made pursuant to s298(2) of the Corporations Act 2001.
Signed in accordance with a resolution of the directors:
Ian McCann Director Dated at Sydney, 24 April 2019
9
Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001 To the Directors of Wentworthville Leagues Club Limited I declare that, to the best of my knowledge and belief, in relation to the audit of Wentworthville Leagues Club Limited for the financial year ended 31 December 2018 there have been: i.
no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and
ii.
no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG
Cameron Roan Partner Sydney 24 April 2019
KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity.
Liability limited by a scheme approved under Professional Standards Legislation.
10
Independent Auditor’s Report To the Directors of Wentworthville Leagues Club Limited Report on the audit of the Financial Report
Opinion We have audited the Financial Report of Wentworthville Leagues Club Limited (the Company). In our opinion, the accompanying Financial Report of the Company is in accordance with the Corporations Act 2001, including:
giving a true and fair view of the Company’s financial position as at 31 December 2018 and of its financial performance for the year ended on that date; and complying with Australian Accounting Standards - Reduced Disclosure Requirements and the Corporations Regulations 2001.
The Financial Report comprises:
Statements of financial position as at 31 December 2018
Statements of profit or loss and other comprehensive income, statements of comprehensive income, statements of changes in equity, and statements of cash flows for the year then ended
Notes including a summary of significant accounting policies
Directors’ Declaration.
Basis for opinion We conducted our audit in accordance with Australian Auditing Standards. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report section of our report. We are independent of the Company in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with the Code. We confirm that the independence declaration required by the Corporations Act 2001, which has been given to the Directors of Wentworthville Leagues Club Limited, would be in the same terms if given to the Directors as at the time of this Auditor’s Report.
11
Other Information Other Information is financial and non-financial information in Wentworthville Leagues Club Limited’s annual reporting which is provided in addition to the Financial Report and the Auditor’s Report. The Directors are responsible for the Other Information. Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of assurance conclusion thereon. In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be materially misstated. We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report The Directors are responsible for: •
preparing the Financial Report that gives a true and fair view in accordance with Australian Accounting Standards - Reduced Disclosure Requirements and the Corporations Act 2001
•
implementing necessary internal control to enable the preparation of a Financial Report that gives a true and fair view and is free from material misstatement, whether due to fraud or error
•
assessing the Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless they either intend to liquidate the Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report Our objective is:
to obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or error; and
to issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the Financial Report. A further description of our responsibilities for the audit of the Financial Report is located at the
12
Auditing and Assurance Standards Board website at: http://www.auasb.gov.au/auditors_responsibilities/ar3.pdf. This description forms part of our Auditor’s Report.
KPMG
Cameron Roan Partner Sydney 24 April 2019
13
Wentworthville Leagues Club Limited Directors' declaration In the opinion of the directors of Wentworthville Leagues Club Limited (the Company): (a) the Company is not publicly accountable; (b) the financial statements and notes, set out on pages 15 to 35, are in accordance with the Corporations Act 2001, including: (i)
giving a true and fair view of the Company's financial position as at 31 December 2018 and of its performance for the financial year ended on that date; and
(ii) complying with Australian Accounting Standards - Reduced Disclosure Regime and the Corporations Regulations 2001; and (c) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.
Signed in accordance with a resolution of directors.
_________________________________ Ian McCann Director Dated at Wentworthville this 24th day of April 2019
14
Wentworthville Leagues Club Limited Statement of profit or loss and other comprehensive income For the year ended 31 December 2018 In AUD
Revenue Impairment on investment property Loss from disposal of non current assets Change of inventories of finished goods Donations Personnel expenses Entertainment, advertising and promotions Poker machine compliance costs Legal, consulting and auditor fees Raw materials and consumables used Repairs, consumables and maintenance Utilities and government charges Other expenses Profit before depreciation, income tax and finance costs
Note 4 4 4
2018
2017
65,555,518 (264,996) (1,305,680) 31,851 (1,368,555) (16,867,474) (5,479,199) (13,572,233) (272,686) (5,510,841) (1,996,827) (2,316,594) (3,617,053) 13,015,231
70,049,273 370,377 11,647 (1,629,528) (16,808,007) (5,949,861) (14,385,493) (196,816) (6,155,058) (1,942,717) (2,242,557) (3,873,219) 17,248,041
Depreciation and amortisation Results from operating activities
(5,506,817) 7,508,414
(5,618,822) 11,629,219
Finance income Finance expenses Net finance costs
89,898 (2,249,686) (2,159,788)
118,953 (312,226) (193,273)
5,348,626
11,435,946
(227,899) 5,120,727
(541,630) 10,894,316
5,120,727
10,894,316
5
6
Profit before income tax Income tax expense Profit for the year
7
Other comprehensive income Total comprehensive income for the year
The notes on pages 19 to 35 are an integral part of these financial statements.
15
Wentworthville Leagues Club Limited Statement of financial position As at 31 December 2018 In AUD
Assets Cash and cash equivalents Trade and other receivables Inventories Prepayments Total current assets Property, plant and equipment Investment property Deferred tax assets Intangibles Investments Other non-current assets Total non-current assets Total assets Liabilities Trade and other payables Provision for income tax Borrowings Employee benefits Provisions Total current liabilities Borrowings Employee benefits Trade and other payables Provisions Total non-current liabilities Total liabilities Net assets
Note
2018
2017
8 9 10 12
8,187,032 157,727 215,841 2,418,754 10,979,354
10,261,935 68,937 247,692 948,678 11,527,242
15 14
150,564,130 15,608,212 136,144 1,790,717 22,231 1,557 168,122,991 179,102,345
88,419,667 14,675,399 142,878 1,790,717 24,503 1,557 105,054,721 116,581,963
8,380,260 6,360,881 1,436,496 563,390 16,741,027
4,240,236 66,354 1,264,313 1,446,692 578,986 7,596,581
52,555,766 304,751 144,435 76,314 53,081,266 69,822,293 109,280,052
4,263,682 338,890 143,858 79,627 4,826,057 12,422,638 104,159,325
109,280,052 109,280,052
104,159,325 104,159,325
13 11 12
16 18 17 19
18 17 16 19
Members' funds Retained profits Total members' funds
The notes on pages 19 to 35 are an integral part of these financial statements.
16
Wentworthville Leagues Club Limited Statement of changes in members' funds As at 31 December 2018 In AUD
General funds
Balance at 1 January 2017
93,265,009
Total comprehensive income for the period Profit for the year Other comprehensive income Total comprehensive profit for the period
10,894,316 10,894,316
Balance at 31 December 2017
104,159,325
Balance at 1 January 2018
104,159,325
Total comprehensive income for the period Profit for the year Other comprehensive income Total comprehensive profit for the period Balance at 31 December 2018
5,120,727 5,120,727 109,280,052
The notes on pages 19 to 35 are an integral part of these financial statements.
17
Wentworthville Leagues Club Limited Statement of cash flows For the year ended 31 December 2018 In AUD
Note
2018
2017
Cash flows from operating activities Cash receipts from customers Cash paid to suppliers and employees Cash generated from operations Dividends received Interest paid and other finance costs paid Income tax paid Net cash from operating activities
72,172,289 (54,891,599) 17,280,690 2,272 (2,249,686) (431,964) 14,601,313
77,081,345 (60,243,376) 16,837,969 3,173 (312,226) (547,600) 15,981,316
Cash flows from investing activities Proceeds from sale of property, plant and equipment Acquisition of investment property Acquisition of property, plant and equipment Interest received Acquisition of gaming licenses Net cash flows used in investing activities
330,623 (1,560,820) (68,924,568) 89,899 (70,064,867)
100,073 (38,880) (18,122,278) 118,954 (1,024,968) (18,967,099)
Cash flows from financing activities Proceeds from borrowings Repayment of leases Net cash flows from financing activities
55,180,154 (1,791,502) 53,388,652
(611,312) (611,312)
Net decrease in cash and cash equivalents Cash and cash equivalents at beginning of year Cash and cash equivalents at end of year
(2,074,903) 10,261,935 8,187,032
(3,597,095) 13,859,030 10,261,935
8
The notes on pages 19 to 35 are an integral part of these financial statements.
18
Wentworthville Leagues Club Limited Notes to the financial statements For the year ended 31 December 2018 1
Reporting entity Wentworthville Leagues Club Limited (the Company) is a company limited by guarantee incorporated and domiciled in Australia. The address of the Company's registered office is 50 Smith Street, Wentworthville, NSW, 2145. The financial statements of the Company are as at and for the year ended 31 December 2018.
2 (a)
Basis of preparation Statement of compliance In the opinion of the directors, the Company is not publicly accountable. The financial statements are Tier 2 general purpose financial statements which have been prepared in accordance with Australian Accounting Standards – Reduced Disclosure Requirements adopted by the Australian Accounting Standards Board and the Corporations Act 2001. These financial statements comply with Australian Accounting Standards – Reduced Disclosure Requirements. The financial statements were approved by the Board of Directors on 24 April 2019.
(b) Adoption of AASB 9 - Financial Instruments On 1 January 2018, the Company was required to adopt the Australian Accounting Standard AASB 9 - Financial Instruments .This was the first financial year the Company adopted this Standard. The Company has made an assessment of the impact of AASB 9 on the financial statements ended 31 December 2018. There was no material impact noted for the year ended. (c)
Basis of measurement The financial statements have been prepared on the historical cost basis.
(d) Going concern The financial statements have been prepared on a going concern basis, which contemplates the continuity of normal business activities and realisation of assets and settlement of liabilities in the ordinary course of business.
(e)
Functional and presentation currency These financial statements are presented in Australian dollars, which is the Company's functional currency.
(f)
Use of estimates and judgements The preparation of financial statements in conformity with AASBs requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and in any future periods affected. Information about assumptions and estimation uncertainties that have a significant risk of resulting in a material adjustment within the next financial year are included in the following notes: • Note 13
Intangible assets
• Note 25
Contingencies
19
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 2
Basis of preparation (continued)
(g) Changes in accounting policies Certain comparative amounts have been reclassified to conform with the current year’s presentation. A number of new standards, amendments to standards and interpretations are effective for annual periods beginning after 1 January 2018, and have not been applied in preparing these financial statements. Those which may be relevant to the Company are AASB 15 Revenue from contracts with customers , becomes mandatory for the 2019 financial statements and could change the classification and recognition method of revenue. It establishes a comprehensive framework for determining whether, how much and when revenue is recognised. AASB 16 Leases requires companies to bring most operating leases on-balance sheet from 2019. Companies with operating leases will appear to be more asset-rich, but also more heavily indebted. AASB 16 is effective for the Company’s 2019 financial statements. The Company had reviewed the requirements of these standards and they are not expected to have a significant impact on the Company's financial statements. 3
Significant accounting policies The accounting policies set out below have been applied consistently to all periods presented in these financial statements.
(a) (i)
Financial instruments Recognition and initial measurement Trade receivables and debt securities issued are initially recognised when they are originated. All other financial assets and financial liabilities are initially recognised when the Company becomes a party to the contractual provisions of the instrument. A financial asset (unless it is a trade receivable without a significant financing component) or financial liability is initially measured at fair value plus, for an item not at fair value through profit and loss transaction costs that are directly attributable to its acquisition or issue. A trade receivable without a significant financing component is initially measured at the transaction price.
(ii)
Classification and subsequent measurement On initial recognition, a financial asset is classified as measured at: amortised cost; fair value through other comprehensive income - debt investment: fair value through other comprehensive income - equity investment: or fair value through profit and loss. Financial assets are not reclassified subsequent to their initial recognition unless the Company changes its business model for managing financial assets, in which case all affected financial assets are reclassified on the first day of the first reporting period following the change in the business model. A financial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at fair value through profit • it is held within a business model whose objective is to hold assets to collect contractual cash flows: and • its contractual terms give rise on specified dates to cash flows that are solely payments of principal and interest on the principal an-aunt outstanding. All financial assets not classified as measured at amortised cost or fair value through other comprehensive income as described above are measured at fair value through profit and loss. This includes all derivative financial assets. On initial recognition, the Company may irrevocably designate a financial asset that otherwise meets the requirements to be measured at amortized cost or at FVOCI as at FVTPL if doing so eliminates or significantly reduces an accounting mismatch that would otherwise arise.
20
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 3
Significant accounting policies
(a)
Financial instruments (continued) Financial assets at fair value through profit and loss These assets are subsequently measured at fair value. Net gains and losses, including any interest or dividend income, are recognised in profit or loss. Financial assets at amortised cost These assets are subsequently measured at amortised cost using the effective interest method. The amorised cost is reduced by impairment losses. Interest income, foreign exchange gains and losses and impairment are recognised in profit or loss. Any gain or loss on derecognition is recognised in profit or loss.
(iii)
Derecognition Financial assets The Company derecognises a financial asset when the contractual rights to the cash flows from the financial asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all of the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all of the risks and rewards of ownership and it does not retain control of the financial asset. The Company enters into transactions whereby it transfers assets recognised in its statement of financial position, but retains either all or substantially all of the risks and rewards of the transferred assets. In these cases, the transferred assets are not derecognised. Financial assets at fair value through profit or loss. Financial liabilities The Company derecognises a financial liability when its contractual obligations are discharged or cancelled, or expire. The Company also derecognises a financial liability when its terms are modified and the cash flows of the modified liability are substantially different, in which case a new financial liability based on the modified terms is recognised at fair value. On derecognition of a financial liability, the difference between the carrying amount extinguished and the consideration paid (including any non-cash assets transferred or liabilities assumed) is recognized in profit or loss.
(b) Property, plant and equipment (i) Recognition and measurement Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses. Cost includes expenditure that is directly attributable to the acquisition of the asset. Purchased software that is integral to the functionality of the related equipment is capitalised as part of that equipment. When parts of an item of property, plant and equipment have different useful lives, they are accounted for as separate items (major components) of property, plant and equipment. The gain or loss on disposal of an item of property, plant and equipment is determined by comparing the proceeds from disposal with the carrying amount of the property, plant and equipment and is recognised net in profit or loss.
(ii)
Reclassification to investment property When the use of a property is held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of goods or services or for administrative purposes, the property is reclassified as investment property.
(iii)
Subsequent costs Subsequent expenditure is capitalised only when it is probable that the future economic benefits associated with the expenditure will flow to the Company. Ongoing repairs and maintenance are expensed as incurred.
21
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 3 Significant accounting policies (continued) (b) Property, plant and equipment (continued) (iv) Depreciation Items of property, plant and equipment are depreciated from the date that they are installed and are ready for use.
Depreciation is calculated to write off the cost of property, plant and equipment less their estimated residual values using the straight-line basis over their estimated useful lives. Depreciation is generally recognised in profit or loss, unless the amount is included in the carrying amount of another asset. Land is not depreciated. The estimated useful lives for the current and comparative years of significant items of property, plant and equipment are as follows: • Buildings including investment properties 40 years • Leasehold improvements 11 years • Plant and equipment 5 - 10 years • Equipment under finance lease 3 years • Furniture, fixtures and fittings 5 - 10 years • Office machines 3 - 5 years • Motor vehicles 8 years Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate. (c)
Intangible assets Poker machine entitlements Poker machine entitlements that are acquired by the Club, which have infinite useful lives, are measured at cost less accumulated impairment losses. Subsequent expenditure Subsequent expenditure is capitalised only when it increases the future economic benefits embodied in the specific asset to which it relates. All other expenditure is recognised in profit or loss as incurred. Impairment Poker machine entitlements have indefinite useful lives as they have no expiry date. Accordingly, such intangible assets are not amortised but are systematically tested for impairment at each reporting date (see note 3(g)).
(d) Non-current assets held for sale Non-current assets, that are expected to be recovered primarily through sale rather than through continuing use, are classified as held for sale. Immediately before classification as held for sale, the assets are remeasured in accordance with the Club's accounting policies. Thereafter generally the assets are measured at the lower of their carrying amount and fair value less cost to sell. Impairment losses on initial classification as held for sale and subsequent gains or losses on remeasurement are recognised in profit or loss. Gains are not recognised in excess of any cumulative impairment loss. Property, plant and equipment once classified as held for sale are not depreciated.
22
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 3
Significant accounting policies (continued)
(e)
Investment property Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of goods or services or for administrative purposes. Investment property is measured at cost less accumulated depreciation and accumulated impairment losses. Depreciation is recognised on a straight-line basis over the estimated useful lives of each component of investment property. Cost includes expenditure that is directly attributable to the acquisition of the investment property. Subsequent cost is recognised in the carrying amount of the investment property. When the use of a property changes such that it is reclassified as property, plant and equipment, its carrying value is transferred across on date at reclassification.
(f)
Inventories Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the firstin first-out principle, and includes expenditure incurred in acquiring the inventories and other costs incurred in bringing them to their existing location and condition. Net realisable value is the estimated selling price in the ordinary course of business, less the estimated costs of completion and estimated costs necessary to make the sale.
(g) Impairment (i) Non-derivative financial assets Financial instruments and contract assets The Company recognises loss allowances for expected losses on: • financial assets measured at amorised cost; • debt investments measured at fair value through other comprehensive income; and • contract assets. The Company measures loss allowances at an amount equal to lifetime expected credit losses. Loss allowances for trade receivables and contract assets are always measured at an amount equal to lifetime expected credit losses. When determining whether the credit risk of a financial asset has increased significantly since initial recognition and when estimating expected credit losses, the Company considers reasonable and supportable information that is relevant and available without undue cost or effort. This includes both quantitative and qualitative information and analysis, based on the Company's historical experience and informed credit assessment and including forward-looking information. The Company assumes that the credit risk on a financial asset has increased significantly if it is more than 30 days past due. The Company considers a financial asset to be in default when: • the borrower is unlikely to pay its credit obligations to the Group in full, without recourse by the Group to actions such as realising security (if any is held): • or the financial asset is more than 90 days past due. 12-month expected credit losses are the portion of credit losses that result from default events that are possible within the 12 months after the reporting date (or a shorter period if the expected life of the instrument is less than 12 months). The maximum period considered when estimating expected credit losses is the maximum contractual period over which the Company is exposed to credit risk.
23
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018
3 Significant accounting policies (continued) (g) Impairment (continued) Measurement of expected credit losses Credit losses are a probability-weighted estimate of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e. the difference between the cash flows due to the entity in accordance with the contract and the cash flows that the Company expects to receive). Credit losses are discounted at the effective interest rate of the financial asset. Presentation of allowance for expected credit losses in the statement of financial position Loss allowances for financial assets measured at amorised cost are deducted from the gross carrying amount of the assets. For debt securities at fair value through other comprehensive income, the loss allowance is charged to profit or loss and is recognised in other comprehensive income. Write-off The gross carrying amount of a financial asset is written off when the Company has no reasonable expectations of recovering a financial asset in its entirety or a portion thereof. The Company expects no significant recovery from the amount written off. (h) Employee benefits (i)
Defined contribution plans A defined contribution plan is a post-employment benefit plan under which an entity pays fixed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defined contribution plans are recognised as an employee benefit expense in profit or loss in the periods during which services are rendered by employees.
(ii)
Other long-term employee benefits The Company’s net obligation in respect of long-term employee benefits is the amount of future benefit that employees have earned in return for their service in the current and prior periods plus related on-costs; that benefit is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is the yield at the reporting date on government bonds that have maturity dates approximating the terms of the Company’s obligations.
(iii)
Short-term benefits Short-term employee benefit obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profit-sharing plans if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee and the obligation can be estimated reliably.
24
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 3
Significant accounting policies (continued)
(i)
Provisions A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability. The unwinding of the discount is recognised as finance cost.
(j) (i)
Revenue Goods sold Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of returns and allowances, trade discounts and volume rebates. Revenue from the sale of goods is recognised through profit or loss when the performance obligations are fulfilled. Revenue is recognised at fair value of the consideration received net of the amount of goods and services tax (GST) payable to the taxation authority. Rendering of services Revenue from maintenance contracts is recognised through profit or loss when performance obligations are fulfilled. No revenue is recognised if there are significant uncertainties regarding recovery of the consideration incurred cannot be measured reliably, there is a risk of return of goods or there is continuing management involvement with the goods.
(ii)
Rental income Rental income is recognised in profit or loss on a straight-line basis over the term of the lease. Lease incentives granted are recognised as an integral part of the total rental income, over the term of the lease.
(iii)
Dividend and interest revenue Dividend revenue is recognised on a receivable basis. Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the financial asset.
(k)
Lease payments Leases in terms of which the Company assumes substantially all the risks and rewards of ownership are classified as finance leases. Other leases are operating leases and the leased assets are not recognised in the Company's statement of financial position. Payments made under operating leases are recognised in profit or loss on a straight- line basis over the term of the lease. Lease incentives received are recognised as an integral part of the total lease expense, over the term of the lease.
(l)
Finance income Finance income comprises interest income on funds invested. Interest income is recognised as it accrues in profit or loss, using the effective interest method. Finance cost on loans and borrowings is recognised in profit or loss using the effective interest
(m) Income tax Tax expense comprises current and deferred tax. Current tax and deferred tax is recognised in profit or loss except to the extent that it relates to a business combination, or items recognised directly in equity or in other comprehensive income. (i)
Current tax Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax payable in respect of previous years. Current tax payable also includes any tax liability arising from the declaration of dividends.
25
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 3
Significant accounting policies (continued)
(m) Income tax (continued) (ii)
Deferred tax Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is not recognised for temporary differences on the initial recognition of assets or liabilities in a transaction and that affects neither accounting nor taxable profit or loss. The measurement of deferred tax reflects the tax consequences that could follow the manner in which the Company expects, at the end of the reporting period, to recover or settle the carrying amount of its assets and liabilities. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, using tax rates enacted or substantively enacted by the reporting date. Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a net basis or their tax assets and liabilities will be realised simultaneously. A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences, to the extent that it is probable that future taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed at each reporting date and are reduced to the extent that it is no longer probable that the related tax benefit will be realised. The Income Tax Assessment Act 1997 (amended) provides that under the concept of mutuality, clubs are only liable for income tax on income derived from non-members and from outside entities.
(n) Goods and services tax Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense. Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to the Australian Taxation Office (ATO) is included as a current asset or liability in the statement of financial position. Cash flows are included in the statement of cash flows on a gross basis. The GST components of cash flows arising from investing and financing activities which are recoverable from, or payable to, the ATO are classified as operating cash flows.
26
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 4
Profit from operations In AUD
Revenue from continuing activities Revenue from rendering services Revenue from beverage outlet sales Revenue from catering outlet sales Membership subscriptions Commissions -ATM -Keno -TAB -Vending -Other Entertainment and promotion Investment property rentals Other revenue Total revenue from operations Loss from disposal of non current asset Write-off of property, plant and equipment
Impairment on non current assets Impairment on investment properties
5
2017
49,634,314 5,043,506 8,557,635 203,402
52,484,465 5,547,469 9,544,672 201,336
77,002 205,379 85,977 16,047 68,521 764,307 859,691 39,737 65,555,518
81,905 235,729 118,371 45,024 24,357 848,457 876,058 41,430 70,049,273
(1,305,680) (1,305,680)
-
(264,996) (264,996)
370,103 370,103
Personnel expenses In AUD
Wages and salaries Payroll tax Workers compensation Contributions to defined contribution plans Other associated employee expenses
6
2018
2018
13,869,980 765,402 327,997 1,374,107 529,988 16,867,474
2017
13,964,985 765,156 205,023 1,325,927 546,916 16,808,007
Finance income and finance costs In AUD
Interest income Finance income Interest expense Change in Financial assets at fair value through profit or loss Finance costs Net finance costs recognised in profit or loss
2018
2017
89,898 89,898
118,953 118,953
(2,249,686) (2,249,686) (2,159,788)
(312,226) (312,226) (193,273)
27
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 7
Tax expense In AUD
Current tax expense Current expense in respect of the current year Movement in deferred tax asset Under/ (over) provided in prior years Income tax expense/(benefits)
2018
234,633 (6,734) 227,899
2017
568,671 (27,041) 541,630
Numerical reconciliation between tax expense and pre-tax accounting profit The Income Tax Assessment Act 1997 (amended) provides that under the concept of mutuality, registered clubs are only liable for income tax on income derived from non-members and from outside entities. The amount set aside for income tax in the statement of profit or loss and other comprehensive income has been calculated as follows: In AUD
2018
Profit from operations
5,348,626
11,435,946
1,604,588 (15,367,949) 13,339,518 658,476 (6,734) 227,899
3,430,784 (16,532,857) 13,014,578 656,166 (27,041) 541,630
Income tax expense calculated at 30% Effect of revenue that is exempt from taxation Effect of expenses that are not deductible in determining taxable profit Effect of mutuality Movement in deferred tax asset Income tax expense recognised in profit or loss 8
9
2017
Cash and cash equivalents In AUD
2018
Cash at bank Cash at call Cash floats Cash and cash equivalents
1,243,017 2,637,446 4,306,569 8,187,032
2017
472,077 4,545,315 5,244,543 10,261,935
Trade and other receivables In AUD
Trade receivables Sundry debtors Provision for doubtful debts Other receivable
2018
13,283 14,570 (14,570) 144,444 157,727
2017
68,937 14,570 (14,570) 68,937
10 Inventories In AUD
Finished goods - at cost
2018
215,841 215,841
2017
247,692 247,692
11 Investments In AUD
Shares in listed companies
2018
22,231 22,231
2017
24,503 24,503
28
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 12 Other assets In AUD
Current Prepayments Non-current TAB deposits
2018
2017
2,418,754 2,418,754
948,678 948,678
1,557 1,557
1,557 1,557
13 Intangible assets In AUD
2018
Balance at the beginning of the year
1,790,717
765,749
-
1,024,968
1,790,717
1,790,717
Acquisitions Balance at the end of the year
2017
Poker machine entitlements are stated at cost less accumulated impairment losses. Poker machine entitlements have an indefinite useful life given they have no expiry date, and accordingly are not amortised but are to be assessed annually for impairment. 14 Investment property In AUD
Cost Balance at the beginning of the financial year Additions Reversal of impairment losses previously recognised in profit and loss Impairment losses Disposals Balance at the end of the financial year
2018
2017
14,997,701 1,560,819 (264,996) (312,321) 15,981,203
14,629,210 38,880 350,103 (20,492) 14,997,701
322,302 52,241 (1,552) 372,991
292,371 50,423 (20,492) 322,302
Net book value at the beginning of the financial year
14,675,399
14,336,839
Net book value at the end of the financial year
15,608,212
14,675,399
Accumulated depreciation Balance at the beginning of the financial year Depreciation Disposals Balance at the end of the financial year
Impairment losses and recoveries during the period relate to write-downs and recoveries of investment properties to recoverable value based upon both assessments of valuations and capitalisation of rental revenue. The fair value assessment of residential investment properties was undertaken as follows: The latest independent valuations of the Company’s investment property was carried out as at 9 October 2018 by Global Valuation Services Pty Ltd (Registered Valuer No. 2745). The open market value for these properties was $32,156,000.
29
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 15 Property, plant and equipment In AUD
Freehold land Leasehold Plant and & buildings improvements equipment
Furniture, fixtures and fittings
Office machines
Motor vehicles
Cost Balance at 1 January 2018 Additions Disposals Transfers Reclassification adjustment Balance at 31 December 2018
55,854,227 28,136 (18,252) 25,251,283 81,115,394
2,569,970 2,569,970
27,741,163 3,051,133 (2,698,929) 28,093,367
15,516,107 101,479 (1,803,901) 13,813,685
1,570,728 98,135 (192,788) 1,476,075
110,125
Depreciation Balance at 1 January 2018 Depreciation for the year Disposals Balance at 31 December 2018
10,670,873 1,095,782 (5,607) 11,761,048
582,286 129,251 711,537
16,116,119 3,149,306 (2,363,578) 16,901,847
5,307,429 822,494 (795,632) 5,334,291
Carrying amounts At 1 January 2018 At 31 December 2018
45,183,354 69,354,347
1,987,684 1,858,434
11,625,045 11,191,521
10,208,678 8,479,395
Capital work in progress
Total
(50,462) 59,663
18,777,014 65,645,686 (20,455) (25,251,283) 59,150,962
122,139,335 68,924,569 (4,784,787) 186,279,117
975,956 199,098 (192,788) 982,266
67,005 7,458 (50,462) 24,001
-
33,719,668 5,403,389 (3,408,067) 35,714,990
594,773 493,809
43,120 35,662
18,777,014 59,150,962
88,419,668 150,564,130
The fair value assessment of the freehold land and buildings was carried out as at 22 January 2019 by Global Valuations Services Pty Limited Certified practicing valuer no. 67391) of $169,291,000 (including main club, carpark building and site improvements). As land, building and improvements are recorded at cost, the valuation has not been brought to account. As part of the major redevelopment of the club, $1,307,461 of written down plant property and equipment was scrapped as part of the Masterplan.
30
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018
16 Trade and other payables In AUD
2018
2017
Current Trade payables GST payable Other payables Accruals
6,865,344 52,096 1,319,217
1,435,707 258,984 336,643 2,064,840
Members' subscriptions in advance Non-Current Members' subscriptions in advance
143,603
144,062
8,380,260
4,240,236
144,435 144,435
143,858 143,858
17 Employee benefits In AUD
Current Liability for annual leave Liability for long service leave Non-current Liability for long service leave
2018
2017
950,945 485,551 1,436,496
982,224 464,468 1,446,692
304,751 304,751
338,890 338,890
18 Borrowings 2018
2017
Current Bills payable
1,000,000
1,000,000
ANZ Facility Loan
4,450,000
-
Derivative liability
291,778
-
In AUD
Equipment loan
619,103
264,313
6,360,881
1,264,313
4,000,000 47,566,541 421,369 567,856 52,555,766
4,000,000
Non-Current Bills payable ANZ Facility Loan Derivative liability Equipment loan
263,682 4,263,682
During the year, the entity entered into a hedging contract with ANZ over its loan facility. As part of the loan hedge the entity was liable to pay or receive the difference of the fixed rate of 3% and the floating rate of 1.98% which has been recorded as a derivative liability.
31
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 18 Borrowings (continued) In AUD
The club has access to the following lines of credit: Bank overdraft Market rate loan Business cards Contingent liabilities Finance lease and equipment Electronic payaway facility Standby letter of credit or guarantee facility Facilities utilised at balance date Bank overdraft Market rate loan Business cards Contingent liabilities Finance lease and equipment Electronic payaway facility Standby letter of credit or guarantee facility Facilities not utilised at balance date Bank overdraft Market rate loan Business cards Contingent liabilities Finance lease and equipment Electronic payaway facility Standby letter of credit or guarantee facility
2018
2017
90,000,000 50,000 700,000 2,200,000 1,000,000 200,000 94,150,000
700,000 5,000,000 40,000 2,000,000 4,160,000 11,900,000
57,016,541 619,938 1,052,561 58,689,040
627,810 527,970 1,155,780
32,983,459 50,000 80,062 1,147,439 1,000,000 200,000 35,460,960
700,000 5,000,000 40,000 1,372,190 3,632,030 10,744,220
-
The bank overdraft facility, the bank loans and lease liabilities are secured by a combination of a registered first mortgage over the club premises at Smith Street Wentworthville and specific freehold property and a registered first equitable mortgage over the club's entire assets and undertakings including uncalled capital. Security consists of: Registered first mortgage by Wentworthville Leagues Club Limited over club premises situated at Wentworthville Leagues Club, Smith Street, Wentworthville, NSW, 2145. A first registered equitable mortgage by Wentworthville Leagues Club Limited over the whole of its assets and undertakings including uncalled capital. Registered first mortgage by Wentworthville Leagues Club Limited over 40 properties situated in Wentworthville. 19 Provisions In AUD
Current Linked poker machine jackpot Provision for mortality commitment Provision for player bonus points Non-Current Provision for mortality commitments
2018
2017
369,801 4,686 188,903 563,390
373,520 4,686 200,780 578,986
76,314 76,314
79,627 79,627
32
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 19 Provisions (continued) Linked poker machine jackpot Poker machine link jackpots is the current balance of available jackpots that accumulate from turnover play on poker machines. These jackpots are returned to players by achieving the required combination for the link jackpot on the machine being played. Member mortality commitment Members who joined the club between 1970 and 1989 may have been eligible for a mortality payment. No external fund exists and all commitments are met out of current cash flow. The present value of the mortality commitment reflects managements estimates based upon similar lapse rates and discount rates to prior year Actuarial valuations. Actuarial valuations are obtained every 5 years unless material movements in experience and discount rates occur. Rewards bonus points The best estimate of the commitment to members in relation to unredeemed bonus points is $188,903 (2017: $200,780). Earning rates, lapse rates and terms and conditions shall impact on future estimates. 20 Related party transactions The directors of the club may from time to time hold a director's role, have membership, life membership or be the patron of the various sport and recreational clubs and football clubs that are governed and controlled by the Leagues Club constitution. A Director of the Company is the principle of a business that has a contract for the provision of rental management of the residential property portfolio. The contract is on commercial terms. The rental management fees paid in the 2018 year were $44,951 (2017: $42,941). A Director of the Company is the principle of a business appointed from time to time to perform contract electrical work. Such appointments are made through a commercial tender process coordinated by Project Management and Building Contractors engaged by the Club. One director of the Company during the year received honorariums as Directors of the Cricket Club. From time to time, directors of the company may purchase goods and engage in services that are provided by the company and available to all members. These purchases are on the same terms and conditions as those available to all other members and may be in addition to allowances entitled by the Constitution and approved by the members at the AGM. Apart from the details disclosed in this note, no director has entered into any contract with the Company since the end of the previous financial year and there were no contracts involving directors interests at year end. Key management personnel compensation The aggregate compensation made to directors and other members of key management personnel of the company is set out below: In AUD
2018
2017
Short term employee benefits
1,162,881
1,178,603
Post employment benefits
105,566 1,268,447
111,967 1,290,570
33
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 21 Leasing commitments In AUD
2018
Finance lease and equipment loan commitments payable Not later than 1 year Later than one year but not later than 5 years Minimum lease payments Present value of minimum lease payments Lease liabilities provided for in the financial statements: Current Non-current
18 18
2017
678,577 567,856 1,246,433 1,246,433
264,288 263,682 527,970 527,970
678,577 567,856 1,246,433
264,288 263,682 527,970
Equipment loans relate to the financing of gaming machines with terms of no greater than 3 years. The Company acquires full title to the equipment at the end of the equipment loan agreement and upon payment of the final loan instalment. 22 Financial reporting period The Company has always used a 52 week cycle for its reporting. The monthly reporting cycle is grouped by weeks and follows a 5, 4, 4 cycle resulting in uniforms days in the relative months across consecutive years with the exception of December. Consequently, the close off day for annual reporting purposes changes every year by a day and two days every leap year. The actual month end date for 2018 is 25 December 2018 and the 2017 actual close date was 26 December 2017. 23 Core and non-core properties Pursuant to Section 41J of the Registered Club Amendments Act 2006, the club categorises property as follows 2018
Core property and non core property
127,456,000 127,456,000
2017
103,095,066 103,095,066
Core properties held by the Club are: 50 Smith Street, Wentworthville NSW 2145 2 Dawes Street, Wentworthville NSW 2145 3 Dawes Street, Wentworthville NSW 2145 4 Dawes Street, Wentworthville NSW 2145 5 Dawes Street, Wentworthville NSW 2145 6 Dawes Street, Wentworthville NSW 2145 7 Dawes Street, Wentworthville NSW 2145 8 Dawes Street, Wentworthville NSW 2145 9 Dawes Street, Wentworthville NSW 2145 10 Dawes Street, Wentworthville NSW 2145 11 Dawes Street, Wentworthville NSW 2145 12 Dawes Street, Wentworthville NSW 2145 13 Dawes Street, Wentworthville NSW 2145 14 Dawes Street, Wentworthville NSW 2145 15 Dawes Street, Wentworthville NSW 2145
34
Wentworthville Leagues Club Limited Notes to the financial statements (continued) For the year ended 31 December 2018 23 Core and non-core properties (continued) 16 Dawes Street, Wentworthville NSW 2145 17 Dawes Street, Wentworthville NSW 2145 428 Great Western Hwy, Wentworthville NSW 2145 432 Great Western Hwy, Wentworthville NSW 2145 430a Great Western Hwy, Wentworthville NSW 2145 3 Jewelsford Street, Wentworthville NSW 2145 5 Jewelsford Street, Wentworthville NSW 2145 7 Jewelsford Street, Wentworthville NSW 2145 9 Jewelsford Street, Wentworthville NSW 2145 11 Jewelsford Street, Wentworthville NSW 2145 13 Jewelsford Street, Wentworthville NSW 2145 15 Jewelsford Street, Wentworthville NSW 2145 17 Jewelsford Street, Wentworthville NSW 2145 19 Jewelsford Street, Wentworthville NSW 2145 21 Jewelsford Street, Wentworthville NSW 2145 27 Jewelsford Street, Wentworthville NSW 2145 31 Jewelsford Street, Wentworthville NSW 2145 51 Smith Street, Wentworthville NSW 2145 68 Smith Street, Wentworthville NSW 2145 70 Smith Street, Wentworthville NSW 2145 72 Smith Street, Wentworthville NSW 2145 74 Smith Street, Wentworthville NSW 2145 76 Smith Street, Wentworthville NSW 2145 78 Smith Street, Wentworthville NSW 2145 80 Smith Street, Wentworthville NSW 2145 24 Commitments In AUD
Capital works Capital works contracted for but not yet completed
2018
29,505,244 29,505,244
2017
95,827,709 95,827,709
25 Contingent assets and contingent liabilities The directors are of the opinion that provisions are not required in respect of these matters, as it is not probable that a future sacrifice of economic benefits will be required or the amount is not capable of reliable measurement. In AUD
2018
2017
Guarantees Bank guarantees
619,938
627,810
As at 31 December 2018, the above bank guarantees are held with Commonwealth Bank of Australia ($439,938) and ANZ Bank ($180,000). 26 Events subsequent to reporting date There have been no events subsequent to reporting date which would have a material effect on the Club's financial statements as 31 December 2018. 27 Members guarantee The Company is limited by guarantee. If the Company is wound up, Rule 23 of the Constitution states that each member at that time, or within one year afterwards is required to contribute a maximum of $1 each towards meeting any outstanding obligations of the company. At 31 December 2018 the number of members were 63,397 (2017: 63,563). 35
Wentworthville Leagues Club Limited Unaudited income statements For the year ended 31 December 2018 Unaudited detailed Income Statement disclaimer - The additional information presented on pages 36 to 37 is in accordance with the books and records of Wentworthville Leagues Club Limited which have been subject to the audit procedures applied in the Statutory audit by KPMG for the year ended 31 December 2018. it will be appreciated that out statutory audit did not cover all details of the additional financial data. Accordingly, we do do not express an opinion on such financial data and no warranty or accuracy reliability is given.
WENTWORTHVILLE LEAGUES CLUB STATUTORY RESULTS FOR LEAGUES CLUB YEAR ENDED 2018 ACTUAL 2018 54,564,139 4,929,825 49,634,314
ACTUAL 2017 57,706,405 5,221,939 52,484,466
Beverage Sales Catering Sales Commission Keno Commission Other Commission Tab Dividends Received Entertainers Interest Received Membership Fees Rent Received Sundry Revenue Telephones
5,043,506 8,557,635 205,379 160,940 85,977 (1,373) 764,391 91,271 203,402 859,691 39,653 630 16,011,103
5,547,469 9,544,671 235,729 150,589 118,371 (1,861) 845,850 120,814 201,336 876,058 44,037 697 17,683,760
Total Revenue
65,645,416
70,168,226
Advertising Auditors Fee Bad Debt Bank Charges Beverage Expenses CMS Line Fee Catering Expenses Cleaning Materials Club Journal Computer Expenses Consulting Fees Contractors Depreciation Directors Expenses Directors Honoraria Donations Electricity Entertainers Entertainment Fringe Benefit Tax Gaming Duty Gas Hiring Charges Impairment Insurance Interest Land Tax Legal Fees Members Entertainment Members Expenses Mortality Funds Payroll Tax Postage & Courier Printing Prizes & Promotions
245,829 76,633 400 170,664 1,759,491 296,746 3,725,058 231,585 327,623 316,678 160,095 2,047,889 5,455,630 87,620 63,798 302,116 771,987 877,016 6,192 60,000 13,572,233 277,510 119,493 264,996 628,632 2,079,022 283,837 35,958 146,664 9,951 (763) 765,402 164,870 120,164 3,930,293
390,526 74,516 164 105,019 1,972,151 264,613 4,176,621 253,504 407,142 339,181 63,184 2,055,969 5,618,822 104,426 63,132 509,043 723,688 984,958 2,920 65,519 14,385,493 234,947 99,124 (350,103) 576,579 207,207 248,197 59,120 152,669 17,738 (2,273) 765,156 56,791 138,790 4,225,397
Gaming Machine Revenue Less GST Applicable Thereto Gaming Machine Revenue
36
WENTWORTHVILLE LEAGUES CLUB STATUTORY RESULTS FOR LEAGUES CLUB YEAR ENDED 2018
Property Fees Provisional Expenses Rates & Taxes Rental Finance Repairs & Maintenance Responsible Gaming Salary & Wages Security Services Sporting Association Staff Hiring Staff Training & Amenities Stationery Sundry Expenses Sundry Licences Superannuation Telephones Travelling Expenses Total Expenditure
ACTUAL 2018 44,951 317,800 520 1,877,334 51,188 13,468,039 114,381 1,066,439 325,580 524,208 26,898 70,960 237,428 1,374,107 68,080 41,890 58,991,110
ACTUAL 2017 42,941 323,211 2,080 1,843,593 47,250 13,578,618 208,223 1,073,235 306,206 537,536 25,555 67,055 249,871 1,325,927 76,346 54,979 58,752,557
Profit from ordinary activities before disposal of Fixed Assets
6,654,307
Loss (Profit) Of Disposal of Fixed Assets
1,305,680
(20,274)
Profit from ordinary activities before income tax expense
5,348,626
11,435,943
227,899
541,630
5,120,727
10,894,313
Income Tax Expense Net Profit
11,415,669
37
Wenty Leagues in Partnership with the Community Wenty Leagues has a proud record of supporting welfare, charitable and sporting organisations within our community. The following were the beneficiaries of financial and in-kind support in 2018 -
•
Act for Kids Golf Day
•
Lions Club
•
Royal Institute for Deaf and Blind Children
•
Adam Gardiner Fund
•
Make a Wish Foundation
•
Scouts Australia
•
Alexander Davis - Special Olympics National Games
•
Make a Wish Foundation
•
St Paul's Catholic College
•
Allity Aged Care
•
Maltese Elderly Committee
Day
•
Toastmasters International
•
ASPECT
•
MALTESE PAST PUPILS & FRIENDS OF DON BOSCO (Aus) Inc.
•
Toongabbie Girl Guides
•
Association of Civil Marriage Celebrants of NSW and ACT Inc.
•
Maltese RSL Sub Branch
•
Toongabbie West Public School P&C
•
Autism Spectrum Australia
•
McHappy Day Wentworthville
•
Wentworthville Community Garden
•
Beresford Road Public School Parents and Citizens Association
•
Myeloma Australia
•
Western Sydney Academy of Sport
•
Blues Wheelchair “BWCB”
Club
•
NSW Autism Advisor Program
•
Westmead Research
•
Ceroc and Modern Drive Dance Company
•
NSW Justices
•
Westmead Public School
•
Cittandini Maltese Cultural Event
•
NSW Tamil Community
•
Winston Heights Public School
•
Community Care Inc
•
O.L.Q.P Junior Rugby League Football Club
•
Youth Off The Streets
•
Cumberland Branch NSWJA
•
Our Lady Queen of Peace Parish Festa Committee
•
Cumberland Council
•
Our Lady Queen of Peace Primary, Greystanes
•
Cumberland Nepean Softball Association Inc.
•
Parramatta Chamber of Commerce
•
Darcy Road Public School
•
Parramatta District Cricket Association INC.
•
Foxy's Sunshine Club
•
Parramatta District Rugby Referees Association (PDRLRA)
•
Girraween Public School
•
Parramatta Eels
•
Golden Retrievers
•
Parramatta Mission
•
Greystanes Public School Fundraising Committee
•
Ringrose Park Public School
•
KidSafe New South Wales Inc
•
Ronald McDonald House Westmead
•
KU Wentworthville Preschool
•
Rotary Club of Holroyd Inc
Basketball
P&C
Thanksgiving
-
McDonald's
Institute
for
League
38
Medical
WENTWORTHVILLE LEAGUES CLUB LIMITED For The Financial Year Ended 31 December 2016
Wentworthville Leagues Club Limited 50 Smith St, Wentworthville NSW 2145
Wentworthville Leagues Club Limited
39
59th Annual Report 2016
41