2013 Annual Report by Whitireia New Zealand

WHITIREIA NEW ZEALAND ANNUAL REPORT 2013

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leading and illuminating

OUR

www.whitireia.ac.nz

communities through tertiary

EDUCATION

annual report 2013

Ko te manu e kai i te miro, nĹ?na te ngahere, ko te manu e kai i te mÄ tauranga, nĹ?na te ao. The one who partakes of the flora and fauna, that will be their domain. The one who engages in education, opportunities are boundless.

Values Manaaki Encouraging co-operation in learning and resource sharing to promote individual confidence and group harmony through a positive and supportive learning environment

Identity Creating a learning environment where all people feel they belong because their uniqueness is valued and promoted

Equity

Vision Whitireia will lead and illuminate its communities through tertiary education

Achieving more equal outcomes by providing significant learning and education success for those who have previously lacked such opportunities

Responsiveness Being flexible, creative and open to change, to better meet individual, industry and community learning needs

Success Being an effective organisation with a clear sense of purpose, striving for excellence and creating an environment where all have the right to succeed

Integrity Maintaining the highest ethical standards and permitting public scrutiny to ensure the maintenance of those standards

Accountability Monitoring and reporting on the maintenance of educational quality standards and on the responsible use of public resources

ANNUAL REPORT 2013

Contents 02

Snapshot of 2013

Council Chair Report

Chief Executive Report

The Choice Protocol

Combined Council

16 Executive 17

Combined Academic Board

18 Highlights 20 Profile 22 Achievements 29

Performance Commitments

Performance Measures Definitions

Financial Statements

Statement of Financial Performance

Statement of Comprehensive Income

Statement of Changes in Equity

Statement of Financial Position

Statement of Cash Flows

Notes to the Financial Statements

Independent Auditorâ&#x20AC;&#x2122;s Report

2013 SNAPSHOT OF THE Whitireia Group

8,501

3,248

CERTIFICATES, DIPLOMAS, DEGREES & POSTGRADUATE CERTIFICATES AWARDED

STUDENTS ENROLLED

4,741

2,021 407 458 133 229

EQUIVALENT

FULL-TIME STUDENTS (EFTS)

121 PROGRAMMES OFFERED

55%

DIPLOMAS AWARDED DEGREES AWARDED GRADUATE CERTIFICATES & DIPLOMAS AWARDED POSTGRADUATE CERTIFICATES AWARDED

LEVEL 8

45%

CERTIFICATES AWARDED

LEV

26%

STUDENTS STUDY

62%

LEVELS 1-5

LEVELS 1-8

E LEV

MALE

FEMALE

1,207 STUDENTS

ENROLLED DIRECTLY FROM SECONDARY SCHOOL

242 ACADEMIC STAFF 207 EXECUTIVE & SUPPORT STAFF

ANNUAL REPORT 2013

NCEA LEVEL 1 OR SCHOOL CERTIFICATE

10%

NCEA LEVEL 2 OR 6TH FORM CERTIFICATE

15% 10%

NCEA LEVEL 3, BURSARY OR SCHOLARSHIP

18% 2%

NO FORMAL SECONDARY SCHOOL QUALIFICATION OTHER

26% 7%

OVERSEAS QUALIFICATION UNIVERSITY ENTRANCE

UNKNOWN

56 FOUNDATION SCHOLARSHIPS AWARDED R

E OTH

7% MA-ORI

15%

17% I

FIC

STUDENT ETHNICITY 21% N

ASIA

C PA

40%

D AN EAL AN Z NEW ROPE EU

13 SECONDARY SCHOOL

LEAVER FEE SCHOLARSHIPS AWARDED

7 4

LOCATIONS

14 OR MORE CREDITS AT ANY LEVEL

AUCKLAND

CAMPUSES

ENTERED THEIR STUDY WITH

4 PRIVATE TRAINING

ESTABLISHMENTS

IN 7 LOCATIONS

KAPITI PORIRUA WELLINGTON

22% 78% INTERNATIONAL STUDENTS

1,349

DOMESTIC STUDENTS

YEAR 10

STUDENTS

PARTICIPATED IN TERTIARY EXPLORATION SESSIONS

STUDENT NUMBERS BY FACULTY 1,048

ARTS

1,720

BUSINESS

1,641

HEALTH

2,306

TRADES & SERVICES TE WANANGA MAORI WHITIREIA NEW ZEALAND LIMITED

AGE DEMOGRAPHIC OF STUDENTS

HIGHEST SECONDARY SCHOOL QUALIFICATION STUDENTS

519 912

15 OR LESS 16-30 YRS 31-45 YRS 46-60 YRS 61 PLUS YRS

2% 5,614 70% 1,513 19% 676 8% 60 1%

188

1,051 STUDENTS

FROM 43 SCHOOLS PARTICIPATED IN STAR PROGRAMMES

32 SECONDARY SCHOOL STUDENTS PARTICIPATED IN GATEWAY PROGRAMMES

Kia ora koutou New Zealand is entering a period of stronger economic growth. One of the challenges associated with this growth will be producing a workforce with the skills needed to take advantage of it. The Department of Labour has indicated that the demand for people with higher level vocational qualifications will increase at a rate of 6% a year over the next decade – more than three times the rate of increase for strictly academic degree holders. Whitireia Community Polytechnic’s (Whitireia) 2013 year tells us that we are in an excellent position to meet the challenge of training students for this growing workforce. In terms of academic achievement, planning for the future and creating strategic partnerships, results for the year have been outstanding. It is particularly pleasing to note that the Tertiary Education Commission’s (TEC) Educational Performance Indicators (EPIs) published nationally show Whitireia in the top rank of Institutes of Technology and Polytechnics (ITPs). The draft data from 2013 indicates we are the leader in course completions and third in qualifications completed. To meet the needs of current and future students, it’s important to provide a physical environment in which they feel comfortable and secure. Over the past two years, we have been working towards the redevelopment of our Porirua campus. A major

COUNCIL CHAIR // HON ROGER SOWRY ONZM

milestone during the past year was the March 2013 opening by Minister of Health, Hon Tony Ryall, of Wikitoria Katene, the new Health building. The $17 million building was fully selffinanced and completed on time and on budget. The project is the largest and most ambitious ever undertaken at Whitireia and represents a quantum leap forward in the quality of our facilities. Students during the year were able to take advantage of the latest simulation suite technology and an integrated approach to learning in health. The new building is proving inspirational for staff and students. Excellent progress was also made in the Students First strategic partnership with Wellington Institute of Technology (WelTec). It’s a recognition that the interests of students and communities in the Wellington region will best be served by the two institutions working in partnership rather than in isolation. The project commenced in 2011. One of the most significant early steps was governance by one Council, effective from 1 January 2012. Whitireia and WelTec also now share a single academic board. During the 2013 year, we advanced nine key projects including aspects of Council operations, industry and students, academic board, branding, campus developments, marketing, international marketing, shared services and centres of excellence. The partnership is also beginning to produce financial benefits with the shared services unit making close to

ANNUAL REPORT 2013

$1m in savings to date. Students First is a ground-breaking initiative that will have a significant effect on the future success of both Whitireia and WelTec and provide a model for the rest of the sector. Whitireia is extremely conscious of its roots in the Wellington region and in particular, Porirua City. During the year, the establishment of Te Komiti Poutokomanawa, a Ngﾄ》i Toa Advisory Group has significantly enhanced our mutual strategic dialogue. Like any year, 2013 produced its share of challenges. In recent years, providing vocational training for international students has been a useful adjunct to our business. Changes in immigration regulation last year impacted on our capacity to attract students from overseas. We are confident the issues associated with these regulations have been clarified to the extent that in future years we will once again be able to grow our international student numbers. Council continued to debate the issues that affect our institution with passion, vigour and a sound commitment to community needs. Thank you to all Councillors for contributing your knowledge and time to Whitireia and the partnership with WelTec. On behalf of Council, I would like to acknowledge the work of Suzanne Snively ONZM and Dennis Sharman who served Whitireia over many years recently as Chair and Deputy Chair and retired from the Council at the end of 2013. I would also like to express my gratitude to

Gregory Fortuin and Ron Wilkinson for their great contribution and sound advice in providing leadership and strategic direction for our Council over their long standing service. I would like to thank Chief Executive Don Campbell for his outstanding leadership in 2013 and the many important and significant achievements. I would also like to thank the Executive team and staff for their dedication to the aims and goals of Whitireia. 2013 has been a great year for Whitireia and the institution is in good heart to face the new challenges 2014 will bring. Noho ora mai Hon Roger Sowry ONZM Council Chair

The $17 million building was fully self-financed and completed on time and on budget. This is the largest and most ambitious project ever undertaken at Whitireia.

Tēnā koutou katoa A year of impressive results and great progress In education, results are the most obvious measures of success. As we look back on 2013, we can reflect with great satisfaction on a year of impressive academic achievement and great progress in the development of Whitireia Community Polytechnic, te Kura Matatini o Whitireia. At an academic level, we continue to be one of the best performers in the vocational education sector. The Tertiary Education Commission which monitors performance in the sector, produces rankings for all 18 polytechnics and institutes of technology. In the two years that rankings have been published, Whitireia has consistently scored above median levels and been a leader in the key performance measures of course completions and qualification completions. The draft figures for the 2013 year indicate we are the leader in course completions in the ITP sector and third in qualifications completed. The rankings tell us that our students are motivated to achieve and more importantly, that our staff are dedicated and focused and our support systems are efficient and robust. Success springs from understanding strengths and working to maximise them. The health field has historically been one of these. The opening in March of Wikitoria Katene, the new Health building at the Porirua campus,

CHIEF EXECUTIVE // DON CAMPBELL

ranks not only as one of the most exciting developments of the year but an example of Whitireia playing to its strengths and working towards the fulfilment of its strategic plan. Wikitoria Katene is part of the redevelopment of the Porirua campus, the biggest building programme in the 28 year history of Whitireia and the next step in a $60m rebuild programme. It provides specialist teaching spaces in a flexible modern learning environment. It includes simulation suites, operable walls to provide flexibly-sized learning spaces, learning streets and the use of natural light to create a contemporary environment. It was opened in time for the 2013 academic year and has proven to be an inspirational learning environment for staff and students. Being successful in the future means thinking ahead. It means being aware of how vocational education might develop in future. It was this kind of thinking that led to the formation in 2011 of a strategic partnership with fellow Wellington-region vocational education provider WelTec. In airline terms, it’s akin to the Star Alliance. It involves each provider recognising the other’s strengths, tailoring courses accordingly and making savings by sharing some functions. The partnership will evolve over time. We are already seeing students benefitting from easier access to a diverse range of programmes.

ANNUAL REPORT 2013

In the 2013 year, we made excellent progress on all nine key partnership projects we have been working on. A critical element has been the way staff from both institutions have worked together to deliver project outcomes. No year is without its challenges. Government policies, in particular immigration regulation changes for international students in New Zealand, have reduced the number of overseas students studying with us. This, and a challenging environment overall, has reduced income and impacted on profitability. Group income was $61m while the group operating deficit was $0.3m.

Educational success

those undertaking courses. In earlier years, students in their thirties were common. While we still attract mature students, the governmentâ&#x20AC;&#x2122;s emphasis on vocational training for those in the 18-25 year age range is having its effect on the composition of the student body. In 2008, 48% of students were under 25. By 2011, the percentage figure had risen to 59% and it continues to grow. Our schoolsâ&#x20AC;&#x2122; liaison staff have done an excellent job of contributing to this increase by developing close relationships with schools. Regardless of these changes, Whitireia is maintaining its reputation for achieving excellent results in terms of the TEC Educational Performance Indicators (EPIs) I referred to earlier.

For me, the most satisfying part of any year is the graduation ceremonies we hold. The delight and sense of fulfilment on the faces of our students are both inspiring and humbling. Just over 8,000 students benefited from quality vocational tertiary education during the academic year. Our student intake changes from year to year. I have already referred to the reduction in the number of international students that resulted from changes in immigration regulations. These changes were subsequently recognised as shortsighted and eventually reversed, but too late to have an impact as 2013 results.

2013 was a year of impressive academic achievement and great progress, in the development of Whitireia Community Polytechnic.

The other material development in our student intake has been a steady reduction in the average age of

To be the best provider in terms of course completions with an improved level of 85% is an impressive achievement. No less satisfying was our third ranking on qualification completions. Our 84% completion rate is also an increase on last year. These are the two most important EPIs. Congratulations to all staff who have helped, encouraged and supported our students to achieve these great results.

Campus development Twenty-eight years since inception doesn’t yet make Whitireia a venerable institution. But despite our relative youth, it is important to be planning for renewal and making sure that facilities meet the needs of current students and teachers. It was with this in mind in 2012, that we embarked on the Polytechnic’s largest-ever building programme. It was a multi-million dollar campus development programme to complete the upgrade of the main Porirua campus. Old pre-fabricated buildings were re-sited for building works as stage one of the programme. In March last year, one of the first tangible signs of renewal and redevelopment, the new health building was opened by the Minister of Health, Hon Tony Ryall. Named Wikitoria Katene, the building houses faculty, administration, classrooms and conference facilities. It includes laboratories, simulation suites and provides state-of-the-art training facilities for around 1000 nursing and paramedic students who study at Whitireia.

The Porirua campus is special to Whitireia because it was where the Polytechnic was originally established. It and the people of Porirua have a special place in our thinking. It was appropriate then that on 20 June, Matiu Rei, Executive Director, Ngāti Toa Rangatira, addressed more than 100 people at an early morning ceremony at the Porirua campus to commemorate the Ngāti Toa signing of Te Tiriti o Waitangi. “Ngāti Toa’s post settlement - a vision for the future“ was the theme of his address. Whitireia Council Chair Hon Roger Sowry OMZM commended Ngāti Toa on this vision, their business and people. “Your goals, vision and strategies will help significantly change New Zealand and make it a better country”, he said. Kāpiti is one of the country’s fastestgrowing regions in New Zealand. The construction of an expressway through the region over the coming five years is an example of the growth the area is experiencing. Our new campus there, opened in 2012, with the benefit of a $3.5m facelift, the once single level, openplan building has been transformed into a state-of-the-art, 21st century learning environment. It has purpose-built facilities for outdoor adventure, a commercial kitchen, a training restaurant, a beauty salon, a hairdressing salon, a training cafe, bar and great student hub areas. A mezzanine floor has been added to house the library, classrooms and computer suites. Video-conferencing, event and function facilities add to the completely wireless campus.

Our investment in Kāpiti is being rewarded in the form of increasing student numbers. We recognised the changes occurring within the region could present opportunities. We have added a programme based around infrastructure to cater for an increase in the workforce employed on the region’s development projects. In the last quarter of 2013 and again early this year, nature reminded us of the Wellington region’s vulnerability to earthquakes. As well as redeveloping our campus properties, we have a responsibility to make sure existing buildings are safe and secure. It is pleasing to report that we suffered no structural damage from the earthquakes and that subsequent inspections have deemed our Wellington-region campuses to be safe. Other developments over the year include the successful launch of a Postgraduate Certificate and Diploma in Information Technology, the development and opening of studios and changing rooms on the Vivian Street, Wellington site and continued growth in the Diploma in Professional Cookery at the Auckland campus. Whitireia invests in sponsorships that advance key relationships or bring benefits to students. Last year, we continued our sponsorship of the Foodstuffs Wellington Training Awards as the principal sponsor of the Supervisory Development category. Whitireia also sponsored categories in the Kāpiti and Porirua Business Awards, the Chapman Tripp Theatre Awards and Te Awe, Wellington Māori Business Network.

ANNUAL REPORT 2013

Recognising our strong links with the Pacific Islands community, Pasifika Trades scholarships were introduced in 2013 with strong support from the Pacific Churches Minister’s Group. Scholarships were provided to students who studied carpentry, electrical, horticulture, landscaping, civil engineering and plumbing programmes at Whitireia and WelTec. Overall results were excellent.

Strategic partnership with WelTec The strategic partnership formed with WelTec in 2011 continues to make excellent progress and deliver on its original promise. The emphasis has been on drawing on the strengths of both institutions to give students easier access to a diverse range of programmes. In the 2013 year, we worked on nine key projects. Evaluation indicated excellent progress was being made on each of them with staff from both institutions working very well together to establish and deliver project outcomes. One of the original objectives was to make savings which could be shared by both institutions. A shared services unit, W2, was established and it’s encouraging to report savings on procurement close to $1m have been achieved to date. A General Manager of the unit was appointed along with a Procurement Manager and an IT Manager. All roles are joint and the W2 unit has its own budget and clear targets. During the year, a Joint Research Symposium was held with two keynote speakers: Dr Dennis

Robinson, Emeritus Professor and Dr Fiona Beals, Lecturer at WelTec. Branding is a critical element in the delivery of today’s tertiary education. An important milestone in the partnership was the development and launch of “The Choice Protocol” brand. The partnership is sufficiently important and exciting to warrant separate treatment within the Annual Report. More detail can be found on page 12.

Strategies for building on success Whitireia has strong links with Māori and Pacific Island students which stem from our Porirua roots. We have one of the largest percentages of Māori and Pasifika students on our roll, of any New Zealand polytechnic. We have recognised that both groups have special needs and that we need strategies to address those needs. In 2010 Whitireia set out to significantly improve retention, completion and success rates for Māori, Pacific and Youth learners. New strategies were developed, and after endorsement from Executive and Council, were implemented through two-year projects in 2012/2013. These projects officially finished at the end of 2013. We are in the process of evaluating them and expect to have results by the end of March 2014. The strategies themselves will live on through a Strategies Sustainability Plan which identifies responsibilities by role, and which will continue to be implemented by Executive, faculty deans, managers

and all staff, through the embedding of various changes within business as usual. While it is too soon to jump to conclusions, early results point to some success in terms of a significant improvment in achievement by Māori, Pacific and Youth learners over the past two years. The Foundation and Youth Strategy seeks to enhance access to foundation education (Levels 1-4). Students will find clear pathways, make well informed choices and experience successful transitions. This project is building pathways both within Whitireia and between schools, kura, Private Training Establishments, Wānanga and Whitireia. The Māori Strategy is reflective and supportive of Māori students to help them achieve success as Māori. Partnership programmes were achieved with Te Wānanga o Raukawa in Trades. We worked with Christchurch Polytechnic Institute of Technology (CPIT) to share research opportunities and implementation of their Māori Exemplar staff development tool. The Pacific Strategy envisions that Pacific students enrolled in Whitireia programmes will achieve their educational goals as successfully as any other group studying at Whitireia. The Pacific Strategy will become a frame of reference for monitoring, planning and decision making across the institution. A professional development programme that aligns to the Pacific

Strategy has been implemented and a Pacific Science taster programme run in three secondary schools. These activities are in collaboration with Bachelor of Nursing Pacific staff and schools’ liaison. Work is underway to establish a repository for Pacific teaching and learning resources. A Science in Schools project commissioned by the Ministry of Health is continuing. Ensuring students enjoy their learning experience has become an important part of attracting and retaining students. The Student Experience Strategy aligns Whitireia services and resources to provide a quality successful learning experience resulting in sustained, mutually beneficial relationships with alumni. A new, more informative and engaging pōwhiri and orientation programme has been very successful and enjoyable for students. Successful students are the product of excellent teaching. Within our strategic framework we have recognised the importance of supporting our teaching staff. Projects with this objective in mind included the People, Performance, Productivity Strategy, focusing on professional development which supports our strategic directions. Key initiatives are to develop critical thinkers and leadership at all levels in the organisation. The financial viability of faculties depends on establishing good practices of cost management and income generation and to encourage continuous improvement in profitability.

The Student Destinations Strategy aims to deliver a process to have accurate and timely information on student outcomes available, to feed into future planning.

International developments The international student market has become an important one for New Zealand vocational training providers. In 2012, 31 percent of Whitireia students came from overseas, roughly half of them from China. That figure had risen from 23% six years earlier. But the market is changeable. Changes within the countries of origin and policy changes within education provider countries make the market dynamic to say the least. Last year, changes in immigration regulations which related to restricted employment opportunities for overseas students, had the effect of making New Zealand a less desirable destination. These changes were reversed towards the end of the year, but too late to avoid a significant impact on our 2013 results. However, there were some positive developments during the year. The most notable was the growth in Indian student numbers by 14% through our India office. We were also able to establish new partner institutions in Sri Lanka, Philippines and Korea. In each case, students have been recruited for Whitireia programmes to be delivered in 2014. It’s encouraging to report that we have been selected as an industry

partner by Immigration New Zealand to streamline visa processing. It’s also pleasing to record the recommencement of the National Diploma in Hospitality Management programme in Porirua with a cohort from Guangzhou, China and the continued growth of the Diploma in Professional Cookery at our Auckland campus. We have successfully launched the new Postgraduate Certificate and Diploma in Information Technology in the International environment, worked on an Indonesian Early Childhood Education (ECE) initiative in conjunction with the Open Polytechnic and carried out product development for an ECE Diploma, Master of Information Technology and Master of Management.

Looking ahead Improving results must always be at the top of our priority list. We have been performing extremely well in the key areas of course completion and qualification achievement. So the top priority for 2014 must include further lifting in educational performance. We will also work hard to realise tangible benefits from the various strategies I’ve mentioned. As well we will be seeking to lift productivity and domestic profitability, increase revenue from the international arm, consolidate and raise the performance of subsidiary Whitireia New Zealand Limited (WNZL) and further develop the Students First strategic partnership.

ANNUAL REPORT 2013

The building plan has made good progress but we will be keeping a close eye on its development to ensure it achieves its time and budget goals. The next stage in the redevelopment of the Porirua campus requires a further building on a similar scale to the Wikitoria Katene building and student accommodation. There will be challenges around its funding which will likely require borrowing for the first time in our history. Our expectations are to continue to improve EPI performance and position relative to other ITPs. This will require even more intensive focus and student support as we approach the top of the performance curve. At the same time we will have to do more with less government funding in 2014 will be lower despite maintaining, rather than losing funding through the Level 1 and 2 contestable allocation process. The dual challenges to both improve educational performance and improve profitability at the same time will be significant. International income will grow in 2014 barring any further changes in immigration regulations, or other government actions which make New Zealand a less desirable education destination than competing countries. Ambitious goals have been set by the Minister of Tertiary Education which are fully supported by Whitireia. They do require effort not only from institutions but also from government agencies to protect and enhance our reputation in the

international market place. More emphasis will be placed over the next few years on generating income from overseas as much as from students coming to New Zealand. The Students First strategic partnership created a much higher public profile and financial benefits during 2013, as the nine key projects were rolled out. Synergies and savings are expected along with a more coherent ITP provision across the whole region in 2014. We expect to strengthen an already strong relationship with NgÄ ti Toa Rangatira through the Advisory Committee Poutokomanawa. In collaboration with our industry partners we expect to strengthen and grow our social and economic contribution to the Wellington region. We also expect to exceed national benchmarks in MÄ ori and Pacific tertiary education outcomes, to enable more students to complete their qualifications. Our aim is to provide tools and support to young people in our community to enable them to make confident and informed choices about tertiary education. We will improve the literacy, language and numeracy skills of our students, further enhance the importance of science, technology, engineering and mathematics (STEM) subjects to our community, and significantly improve outcomes across all TEC priority groups. We will also play an important training role in the major roading projects, MacKays to Peka Peka,

Transmission Gully and Ĺ&#x152;taki bypass in our region over the next ten years. My warm thanks to all staff for your hard work and support in 2013 and particularly to the Executive team, Chris Gosling, Lawrence Arps, Dr Margaret Southwick and Taku Parai. As I reflect on our excellent performance in 2013, I also look forward to a year of big challenges in 2014 and to further progress at Whitireia as we continue to lead and illuminate our communities through tertiary education. Noho ora mai Don Campbell Chief Executive

Ensuring students enjoy their learning experience has become an important part of attracting and retaining students. 11

Today Tomorrow Work is changing, education is changing â&#x20AC;Ś We are changing â&#x20AC;Ś Choices are now essential for students, we get that! 12

The Choice Protocol is Whitireia and WelTec working together to give students education choices that matter. Our goal for tomorrow is more education choices for students. This means: >> More ways to get information >> More information to help students choose the best programmes or mix of programmes >> Access to a wider range of programmes >> Different ways to study >> More campuses to study at >> More options for further study >> More connections with employers

Combined Council

COMBINED COUNCIL (L-R back) Dennis Sharman, Dr Kabini Sanga, Aka Arthur (L-R middle) Ron Wilkinson, Nancy McIntosh-Ward, Gregory Fortuin (L-R front) Don Campbell, Hon Roger Sowry ONZM (Chair), Dr Linda Sissons, Vaughan Renner (Deputy Chair) (L-R inset) Suzanne Snively ONZM, Peter Steel

Hon Roger Sowry ONZM Council Chair

Vaughan Renner Deputy Chair

Roger Sowry was a Member of Parliament from 1990 to 2005, firstly representing the KÄ piti electorate, then as a National list MP. Roger retired from Parliament in 2005 moving to become Chief Executive of Arthritis New Zealand, a position he held until 2008. He is a member of the Electricity Authority and a member of the Institute of Directors.

Vaughan has an MBA, and science and engineering qualifications. He is self-employed and has strong commercial, strategic planning and IT skills. Vaughan has a background in governance (currently including Westlake Governance Limited, Business Central, Business NZ, and Standards New Zealand). He is a member of the Institute of Directors. He was appointed as Deputy Chair of the Open Polytechnic of New Zealand in 2014.

ANNUAL REPORT 2013

Aka Arthur Aka Arthur, Ngāti Toa, has been a resident of Porirua for over 60 years. He is a kaumātua for the Royal New Zealand Police College (since 2000), a member of the Conservation Board and of the Ara Tahi (the Māori Regional Representative Group of the Wellington Regional Council). He is on the Kaiwhaka Manua for the Department of Courts.

Sasketchewan, Canada. He did his early university education at the University of South Pacific, Fiji. He has held a number of senior roles in education, including Director of the Institute of Education of the University of the South Pacific, the Director and Chief Executive Officer of the Solomon Islands College of Education, and the Chief Education Officer, Solomon Islands Ministry of Education.

Gregory Fortuin Gregory Fortuin is a company Director. He is a former Families Commissioner and Race Relations Conciliator. He previously served as a Director of New Zealand Post, Kiwibank, ACC (Investment Committee Chair), Catalyst Injury Management (Chair) and Industry New Zealand. Gregory came to New Zealand in 1991 as the Managing Director of National Mutual Corporate Super Services Limited. He was also a Crown-Trustee and the meeting Chair of the Crown Forest Rental Trust. He was the Founding Chairman of the Youth Suicide Awareness Trust and served on the Boards of Prison Fellowship New Zealand and Youth for Christ.

Dennis Sharman Dennis Sharman owns and operates Sharman Consulting Limited a consultancy company that delivers comprehensive technology services to small and medium sized businesses. Dennis has just completed his term as Chair of the Board of New Zealand Institute of Technologies. Dennis holds a number of Directorships, including government appointments to the Combined Council of Whitireia and WelTec and is also a founding member of the Board of Mana Tiaki.

Nancy McIntosh-Ward Nancy McIntosh-Ward holds an MBA and is a Chartered Accountant and has extensive financial, management, commercial, governance, tertiary education and marketing experience. Nancy is a member of the Institute of Directors. Dr Kabini Sanga Dr Kabini Sanga is an Associate Professor of Education in the Faculty of Education at Victoria University of Wellington. He holds a Doctor of Philosophy from the University of

Suzanne Snively ONZM Suzanne Snively, a former partner at PricewaterhouseCoopers in Wellington, is the Managing Director of strategic and economic advice company, MoreMedia Enterprises. Suzanne is appointed to the Health Research Council by the Minister of Health, Hon Tony Ryall and Chairs the Agri-women Development Trust and Transparency International. She has been the Chief Judge of the Electra Business Awards. Previous directorships include the Reserve Bank of New Zealand. She is a member of the Institute of Directors and the New Zealand Association of Economists. Suzanne was awarded Fulbright and Reserve Bank scholarships and was honoured by the Queen along with

100 women, with a Women’s Suffrage medal. She is a Member of the New Zealand Order of Merit. Peter Steel Peter Steel has an economic and engineering background having worked for over 30 years as a Consulting Engineer, as well as five years as a senior Engineering General Manager at KiwiRail. He has strong commercial, governance and management experience from his work activities as well as a period as President of the Wellington Regional Chamber of Commerce. Peter is currently Managing Director, New Zealand for SMEC New Zealand Limited, part of the international SMEC consultancy group. Ron Wilkinson Ron Wilkinson is the owner of Management Answers, consultants in media and marketing. He has a background in radio and has been active in business and community activities in Kāpiti for almost 20 years. In 2008 he was presented with a Civic Award by the Kāpiti Coast District Council and in 1990 he was awarded a medal for services to broadcasting by the Queen, in recognition of his previous work with Radio New Zealand. He is a former New Zealand radio broadcaster of the year. A former board member, fellow and graduate of the New Zealand College of Management, he has designed and led workshops on many topics including management, media, adult education and e-Learning, and worked extensively in Vietnam, Malaysia, the United States of America, Australia and various countries in the South Pacific.

Executive Don Campbell Chief Executive MBS (Hons), BA (Economics), Dip Tchg, FNZIM Don Campbell has over 30 years experience in the ITP sector, 14 as Chief Executive. He has been Chief Executive of Whitireia New Zealand since 2006 and was Chief Executive of Tai Poutini Polytechnic from 2000 to 2006. Don has served on the Board of the Institutes of Technology and Polytechnics of New Zealand, is a member of the Education New Zealand Stakeholder Advisory Committee, a Business Central Board member, was a Board member of Polytechnics International New Zealand (PINZ), and is a fellow of the New Zealand Institute of Management. Lawrence Arps Deputy Chief Executive (Academic) MEd Admin, BEd Lawrence Arps has been in the tertiary sector since 1994 when he began tutoring Audio Engineering and Music. In 2000, he was appointed Academic Manager of Tai Poutini Polytechnic and led quality development during the institutions period of rapid growth and diversification. Lawrence was made Deputy Chief Executive in 2008. In 2010 he came to Whitireia as Acting Deputy Chief Executive (Operations) and oversaw the refurbishment of the Auckland

campus and the redevelopment of the Porirua campus plan and design of the first of the new buildings. In 2012 he was appointed as Deputy Chief Executive (Academic). Joining the Artena Society Board in 2011, he was given the role of Chair in 2012 and has provided leadership in the refocusing of the Artena Students Management System. Chris Gosling Deputy Chief Executive (Operations) BA (Political Science & Government), Nat Dip Accounting, CA Chris Gosling is Deputy Chief Executive (Operations) and has responsibility for the full range of corporate support functions at Whitireia including finance, human resources, ICT services, marketing and enrolments and facilities. He has been at Whitireia two years. For the five years previous, he worked in the Middle East setting up and operating a polytechnic in the Kingdom of Bahrain. Chris is the former Corporate Services Director at Nelson Marlborough Institute of Technology (NMIT). This role followed several years in finance and senior management roles in local government in New Zealand. He is a Chartered Accountant with membership of the New Zealand Institute of Chartered Accountants.

Taku Parai Pou Arahi BA (First Class Hons) Taku Parai is of Ngāti Toa, Ngāti Raukawa, Te Atiawa and Ngāti Tahu descent. He is the Māori Service Manager for Compass Health and is the Pou Arahi for Whitireia. He is the current Chairman of the Te Rūnanga O Ngāti Toa Rangatira, Chairman of Whakapuaka 1B Block, Cultural Advisor to the Porirua City Council and a member of the Whitireia Executive team. Dr Margaret Southwick QSM Project Manager, People, Capability and Productivity PhD, NZRN Dr Margaret Southwick has been a long-term staff member of Whitireia serving in many different capacities including her a recent tenure as the Dean of the Faculty of Health and Director of the Pacific Health Research Centre. Margaret has contributed to developing Whitireia networks with key stakeholder groups through her extensive experience on government and community boards. She is the previous Chair of the Nursing Council of New Zealand, her involvement in a number of community development initiatives is extensive; she has mentored a number of Pacific community groups. Margaret was awarded the Queen’s Service Medal for services to Pacific communities in 2008.

ANNUAL REPORT 2013

Combined Academic Board Dr Peter Coolbear Chair WHITIREIA Don Campbell Chief Executive

WELTEC Dr Linda Sissons Chief Executive

Lawrence Arps Deputy Chief Executive (Academic)

Alan Cadwallader Academic Director

Helen Gardiner Dean, Faculty of Trades and Services

Julia Hennessy Executive Dean

Gerry McCullough Dean, Faculty of Business

Dylan Mama Student Representative

Willis Katene Dean, Te Manawa

Hinemoa Priest Kaiwhakahaere MÄ ori

Glenys Williams Manager, Academic Quality

Sue Mills Academic Manager Chris Norton Manager, Academic Services Mandy Leighs Secretary

Kupa Winiata, a Certificate in DJ Music student, competed in the world DJ championships in London. Competing in this event is the highest possible accolade for any DJ.

Highlights

APPROVAL OF A WELLINGTON CITY JOINT CENTRE OF EXCELLENCE FOR CREATIVE AND PERFORMING ARTS NGĀTI TOA TE TIRITI O WAITANGI SIGNING

CELEBRATED

HOSTED AT WHITIREIA

WHITIREIA NURSING JOURNAL TURNED 20

WITH CHILD YOUTH AND FAMILY SERVICES

SUCCESSFUL LAUNCH OF POSTGRADUATE

AUTHORED

OFFICIAL OPENING OF

WIKITORIA KATENE NEW HEALTH EDUCATION FACILITY

IT PROGRAMMES NEW PARTNER PROGRAMMES ESTABLISHED

WHITIREIA JOINED FORCES

6 STAFF

BOOKS

IN SRI LANKA, PHILIPPINES AND KOREA

20 YEARS OF CREATIVE WRITING CELEBRATED

THE NEW ZEALAND

PERFORMING ARTS STUDENTS PERFORMED

FILM AND TELEVISION SCHOOL FILMS GAIN

INTERNATIONAL RECOGNITION

IN AND TOURED FRANCE

EARLY CHILDHOOD COUNCIL (ECC)

MOU SIGNED WITH CPIT

CONTRACT FOR DELIVERY WON

SUPPORT AND INCREASE STUDENT

CENTRE MANAGERS’ PROFESSIONAL DEVELOPMENT WORKSHOP PROGRAMME

COMBINED GRADUATION

WERE AWARDED

FOR KĀPITI PHD’S

FOR STAFF DEVELOPMENT TO

RETENTION AND SUCCESS WITH INFRASTRUCTURE ITO TO DELIVER A ONE-WEEK INTENSIVE PROGRAMME

NEW TRAINING 2 STAFF LAUNCH OF THE CHOICE PROTOCOL PROGRAMME ANNOUNCED

TO USE MĀORI EXEMPLAR TOOL

WHITIREIA JOINED FORCES

CEREMONY HELD IN MARCH

BRAND

KEY HOST OF THE AUSTRALASIAN 4 STAFF COMPLETED NURSE EDUCATORS CONFERENCE THEIR MASTER'S 18

MENTAL HEALTH SYMPOSIUM

THREE STUDY TOURS HOSTED MANDY HAGER AWARDED KATHERINE MANSFIELD MENTON FELLOWSHIP FOR 2014

NEW SCHOOL PARTNERSHIP

PROGRAMMES INTRODUCED INTO

LOCAL SCHOOLS

ANNUAL REPORT 2013

State-of-the-art health education facility opened March 2013

Profile The Whitireia group provided quality education to a total of 4,741 EFTS or 8,051 individual students in 2013. Whitireia Community Polytechnic delivered 4,236 EFTS or 7,139 students in 2013.

2013 Whitireia Group EFTS

Whitireia Community Polytechnic 89%

The make-up of the 2013 EFTS provision is as follows:

64%

Whitireia New Zealand Limited 11%

Student Achievement Component (SAC) EFTS including Levels 1-2

27% 4% 5% International EFTS

Youth Guarantee EFTS

Other funded EFTS

2013 Whitireia Community Polytechnic EFTS

SAC Levels 3-8 54% SAC non-contestable Levels 1-2 5% SAC contestable Levels 1-2 5% Other funding 5% Youth Guarantee 4%

International 27%

ANNUAL REPORT 2013

SAC EFTS changed in 2013 with the Levels 1-2 separated into two new funding pools – contestable and non-contestable. Whitireia was successful in being awarded EFTS in the 2013-2014 Levels 1-2 contestable funding pool. In 2013 this made up 5% of the total EFTS delivered by the Polytechnic. WNZL contributed 505 EFTS or 912 students within four operating divisions: Computer Power Plus, New Zealand Film and Television School, New Zealand Radio Training School and a range of performing arts programmes.

Educational performance The main goal of the Whitireia Strategic Plan is to improve educational outcomes and success for students. As this Annual Report shows, Whitireia successfully achieved this goal in 2013. The following commentary provides more information about important aspects of the Polytechnic’s overall performance.

Student participation In 2013, the Whitireia group provided education opportunities to 8,051 individual students, 4,741 EFTS. These students studied mainly at campuses in Porirua, Wellington, Kāpiti, Auckland and Christchurch.

The Whitireia group has a diverse student population with students from many ethnic groups and nationalities. In summary:

40% 15% 17% 21% 7% New Zealand European

Māori

Pacific

Asian

International students The Whitireia group has a high proportion of international students. In 2013, there were 1,208 international EFTS, this made up 25% of the total EFTS. These international students studied at Whitireia (1,151 EFTS) and WNZL (57 EFTS). Whitireia provides a wide range of student support, pastoral care and English language programmes for international students contributing to high levels of success. In 2013, full fee paying international students at Whitireia achieved a successful course completion rate of 84%.

Youth Guarantee students In 2013, TEC allocated 191 Youth Guarantee places to Whitireia. The purpose of this TEC funded provision is to enable young people, where the school environment was unable to meet their needs, into tertiary education to gain an entry level vocational qualification. The benefits for this targeted group are that they gain work ready skills that can lead into apprenticeships without having any education debt. Youth Guarantee achieved successful course completion results of 68% and qualification completion results of 64%.

Other

Achievements Community engagement In 2013 the Combined Council ran several industry consultation events to able direct consultation at a strategic level. These events included industry advisory group members from Whitireia and WelTec and allowed Council members, Whitireia management, faculty staff and industry to work directly together. At the programme and faculty level Whitireia has a very wide range of links to employers, professional organisations, Iwi and community groups. For example, Whitireia has a long-standing relationship with the local Iwi, NgÄ ti Toa, and has developed programmes to foster MÄ ori achievement such as the Bachelor of Nursing MÄ ori. Programme Advisory Committees provide advice for teaching programmes and include employers, industry leaders and community representatives. Whitireia staff are actively involved in professional and industry organisations, such as the Nursing Council of New Zealand. Whitireia provides support to enable the Learning Shop to meet the needs of youth in the Porirua area. All these links assist Whitireia to provide tertiary education that meets the needs of students, families, employers, industry and communities.

Whitireia strives to meet the needs of students, community, employers, industry and government expectations. TEC publish course and qualification completion performance results with rankings of the tertiary sector. Around July / August 2014, the 2013 performance results will be published.

The draft results for Levels 3-8 as at 28 February 2014, demonstrate continual improvement at Whitireia. We are highly encouraged with the provisional draft rankings.

ANNUAL REPORT 2013

Meeting the needs of students and graduates

SAC course completion Course completion result

TEC ITP ranking

2013 provisional results for Levels 3-8 as at 28 February 2013

85%

1st

2012

83%

3rd

2011

80%

7th

2010

76%

10th

2009

73%

8th

Qualification completion result

TEC ITP ranking

2013 provisional results as at 15 February 2013

84%

3rd

2012

78%

3rd

2011

68%

5th

2010

65%

1st

2009

56%

6th

Year

SAC qualification completion Year

Whitireia annually surveys students and graduates to gain feedback on meeting their needs while studying at Whitireia. In the 2013 Student Satisfaction Survey, 87% of the students surveyed expressed an overall satisfaction with their programme of study. The 2013 Graduate Survey highlighted that 95% of graduates, if given the opportunity, would study at Whitireia again.

Prior to 2013 the published rankings were on Levels 1-8 SAC provision

Learning Street Wikitoria Katene

ANNUAL REPORT 2013

"I chose to study at Whitireia because of the reputation they have; they have the best facilities and tutors who are still active in the field." ANNA COCHRANE Bachelor of Health Science (Paramedic)

"Whitireia is a fantastic place to grow as a performer. Having studied here I now feel confident taking my first step in the musical theatre industry." CAMILLA BESLEY Bachelor of Applied Arts (Performing Arts)

ANNUAL REPORT 2013

"I chose to study at Whitireia and the New Zealand Radio Training School because you get to learn through hand's on experience; we do a lot of work with the radio industry, which sets us up well for a career in radio." JOHN STAINTON Diploma in Radio Journalism

"I chose to study carpentry at Whitireia due to my previous experience studying here. I am now taking my study further and creating a career path for my future." SOANE BROWN Certificate in Carpentry

ANNUAL REPORT 2013

Performance Commitments Educational performance Whitireia has established objectives and performance indicators to measure the Polytechnicâ&#x20AC;&#x2122;s performance against its strategic objectives and government priorities for tertiary education. These objectives are aligned with the Whitireia Community Polytechnic Investment Plan for 2013-2015 as agreed with TEC in 2012. 2013 is the first year for objectives and performance indicators in the Investment Plan 2013-2015. Internal Polytechnic information as at 31 January 2014 has been used for student performance regardless of funding type except in progression. TEC has provided provisional 2013 progression performance figures for domestic SAC funded students enrolled in New Zealand as at 31 January 2014.

Strategy

Improve educational outcomes and success for students 2013 success measures

Objectives

Target

Actual

All students all Levels

81%

82%

All students Levels 1-3

75%

76%

All students Level 4 and above

82%

84%

SAC students all Levels

81%

84%

SAC students Levels 1-3

75%

80%

SAC students Level 4 and above

82%

85%

SAC Māori all Levels

72%

79%

SAC Māori Levels 1-3

65%

75%

SAC Māori Level 4 and above

76%

81%

SAC Pacific all Levels

76%

79%

SAC Pacific Levels 1-3

75%

78%

SAC Pacific Level 4 and above

76%

79%

SAC uder 25 all Levels

70%

81%

SAC under 25 Levels 1-3

73%

77%

SAC under 25 Level 4 and above

65%

83%

Additional information

Course completion All students regardless of funding All targets achieved

SAC funded students All targets achieved

SAC Māori students All targets achieved

SAC Pacific students All targets achieved

SAC under 25 students All targets achieved

2009-2013 SAC priority group course completion

2009-2013 SAC Priority Group Course Completion

100% 80%

2013

60%

2012

40%

2011 2010

20%

2009

0% Māori

Pacific

Under 25

ANNUAL REPORT 2013

Strategy

Improve educational outcomes and success for students 2013 success measures

Objectives

Additional information

Target

Actual

73%

68%

Target not achieved. Cohort has particular social and academic challenges

International students all Levels

81%

79%

International students Levels 1-3

75%

66%

Two factors are responsible for international Levels 1-3 target not being achieved.

International students Level 4 and above

82%

81%

Course completion Youth Guarantee students Youth Guarantee students

International students

(1) Whitireia is exiting out of Tongan provision in Levels 1-3 as Tonga transitions to local Tongan qualifications to better meet their local needs. (2) Level 3 Certificate in English Language was not meeting the needs of shortterm international students. In 2014 Whitireia is introducing a new English language portfolio more suitable for short-term international students.

2010-2013 Youth Guarantee course completion

2009-2013 Youth Guarantee Course Completion

100% 80% 60% 40% 20% 0% 2010

2011

2012

2013

Strategy

Improve educational outcomes and success for students 2013 success measures

Objectives

Target

Actual

All students all Levels

75%

78%

All students Levels 1-3

75%

71%

All students Level 4 and above

75%

81%

SAC students all Levels

75%

81%

SAC students Levels 1-3

75%

76%

SAC students Level 4 and above

75%

83%

SAC Māori all Levels

62%

73%

SAC Māori Levels 1-3

60%

70%

SAC Māori Level 4 and above

63%

74%

SAC Pacific all Levels

67%

68%

SAC Pacific Levels 1-3

70%

72%

SAC Pacific Level 4 and above

65%

SAC under 25 all Levels

70%

79%

SAC under 25 Levels 1-3

75%

72%

SAC under 25 Level 4 and above

65%

81%

Additional information

Qualification completion All students regardless of funding A strong focus on qualification completion has continued to produce positive outcomes

SAC funded students All targets achieved

SAC Māori students Continuation of the Māori Strategy has produced positive outcomes

SAC Pacific students Continuation of the Pacific Strategy has produced positive outcomes

SAC under 25 students Continuation of the Youth Strategy has produced positive outcomes

2009-2013 SAC priority group qualification completion

2009-2013 SAC Priority Group Qualification Completion

100% 80%

2013

60%

2012

40%

2011 2010

20%

2009

0% Māori

Pacific

Under 25

ANNUAL REPORT 2013

Strategy

Improve educational outcomes and success for students 2013 success measures

Objectives

Additional information

Target

Actual

70%

64%

Target not achieved. This cohort includes students with significant academic challenges

International students all Levels

83%

75%

International students Levels 1-3

90%

61%

Two factors are responsible for international Levels 1-3 target not being achieved.

International students Level 4 and above

80%

77%

Qualification completion Youth Guarantee students Youth Guarantee students

International students

2010-2013 Youth Guarantee qualification completion

2009-2013 Youth Guarantee Qualification Completion

100% 80% 60% 40% 20% 0% 2010

2011

2012

2013

Strategy Objectives

Improve educational outcomes and success for students 2013 success measures

Additional information

Target

Actual

65%

74%

Target achieved

SAC students Levels 1-3

31%

27%

Target not achieved

Strategy

Improve educational participation

SAC student retention SAC students all Levels SAC student progression

Objectives

2013 success measures

Additional information

Target

Actual

SAC Māori all Levels

22%

21%

Target not achieved

SAC Māori Levels 1-3

Target achieved

SAC Māori Level 4 and above

15%

14%

Target not achieved

SAC Pacific all Levels

19%

20%

SAC Pacific Levels 1-3

SAC Pacific Level 4 and above

13%

12%

Target not achieved

SAC under 25 all Levels

51%

50%

Target not achieved

SAC under 25 Levels 1-3

14%

16%

Target achieved

SAC under 25 Level 4 and above

37%

34%

Target not achieved

30%

27%

Target not achieved

Participation of TEC priority groups Participation within SAC funding SAC Māori EFTS

SAC Pacific EFTS Targets achieved

SAC under 25 EFTS

International EFTS within total EFTS International EFTS all Levels

ANNUAL REPORT 2013

Strategy

Improve student satisfaction 2013 success measures

Objectives

Additional information

Target

Actual

Satisfaction with programme of study

88%

87%

Target not achieved

Satisfaction with services provided

80%

81%

Target achieved

Recommend programme of study

95%

99%

Willingness to study at Whitireia again

92%

95%

Gain employment in related field of study

70%

29%

The Graduand Survey was conducted for the first time in 2013 as part of the application to graduate process which occurs within one to three months of completing the programme of study. This had an adverse impact on the gain employment in related field of study indicator due to most graduates have just commenced to seek employment when they participated in the survey.

Satisfaction Student satisfaction

Graduate

2009-2013 Student programme satisfaction

2009-2013 Student Programme Satisfaction

100% 80% 60% 40% 20% 0% 2009

2010

2011

2012

2013

Strategy Objectives

TEC literacy and numeracy progress 2013 success measures Target

Actual

No target was set for 2013

Not applicable

Literacy and numeracy progress

The proportion of EFTS assessed as requiring additional literacy and numeracy who are enrolled in Levels 1-3 provision and make literacy and numeracy progress as measured by the Literacy and Numeracy for Adults Assessment Tool TEC have advised they are re-working this key performance indicator (KPI) after request for calculation methodology, in order to set the target

Gary Pointon and Laugharne Kemp, Radio Training School graduates were finalists in the 2013 New Zealand Radio Awards.

ANNUAL REPORT 2013

Strategy

Achieve financial strength and sustainability 2013 success measures

Objectives

Additional information

Target

Actual

-0.8%

Revenue was $3.4m below budget due to lower student numbers. This was partially offset by reduced expenditure which was $1.6m below budget.

1:18

Target achieved

Financial strength Financial surplus %

Financial sustainability

Teaching full-time equivalent (FTE) to EFTS ratio

2009-2013 financial surplus / (deficit)

2009-2013 Financial surplus

7% 6% 5% 4% 3% 2% 1% 0% -1%

2009

2010

2011

2012

2013

Strategy

Objectives

Develop infrastructure and systems to support student achievement 2013 success measures Target

Actual

Shared services

Stage one of shared services strategy implemented

ICT and procurement have been incorporated in W2 â&#x20AC;&#x201C; joint Whitireia and WelTec shared services provider

Staff professional development

New professional development framework approved and implemented

New framework implemented and operating

Shared pathways

Develop shared pathways with WelTec for at least two qualifications

Achieved. Several parallel programmes operating

Joint approach to NCEA vocational pathways

Develop joint approach to supporting the NCEA vocational pathways at Levels 1-3

Achieved. Vocational pathways identified and promoted

Student transition between Whitireia and WelTec

Review student information and enrolment practice to identify barriers to students transitioning between Whitireia and WelTec

In progress. Shared policy environment completed. Procedures under review

Support student achievement

Collaboration, pathways and transitions

ANNUAL REPORT 2013

Strategy

Objectives

Develop infrastructure and systems to support student achievement 2013 success measures Target

Actual

Contribute to an increase in the numbers of Year 11 Pacific students engaged in NCEA Level 1 science in collaboration with secondary schools

An increase of eight Pacific student enrolments in NCEA Level 1 science at each of the three participating schools

Pacific Science Project did not run in 2013

Contribute to growing Pacific students secondary to tertiary pathways through science, technology, engineering and mathmatics (STEM) subjects

Report on success factors in encouraging Pacific students to undertake STEM subjects. Recommendations made for growing Pacific student transition pathways

Pacific Science Project did not run in 2013

Building 1 opened

Building 1, named Wikitoria Katene, was officially opened on 20 March 2013

Pacific Science Project

Provide modern, fit for purpose facilities Campus redevelopment: completion of stage one

Andy Tilo and Callum Sefo, performing arts students, landed themselves internships with internationally renowned dance company, Black Grace.

Strategy

Objectives

Develop infrastructure and systems to support student achievement 2013 success measures Target

Actual

Industry engagement with Whitireia

Review of industry liaison completed

Industry engagement workshops completed

Disruptive business model training workshops in Wellington region

The disruptive business models were dependant on the voucher scheme operated by Grow Wellington. No vouchers were issued by Grow Wellington for Whitireia. The loss of the Wellington Business Development representative may have contributed

Capstone projects

61 degree or postgraduate diploma students participated in 27 completed projects for internal and external customers

2012 research report published

Report published

Industry engagement

Research Maintain research culture

Whitireia outdoor adventure graduates, Thomas Tapiklis, Susana Scott and Jorge Sanchez Lopez secured prestigious positions at Outward Bound in the Marlborough Sounds.

ANNUAL REPORT 2013

Performance Measures Definitions Performance measures that the Council considers will enable the preparation of a Statement of Service Performance for the purposed of Section 159YD.2 (a) of the Education Act 1989 are listed below. Students enrolled Usually expressed as equivalent full-time students (EFTS) for the Polytechnic Students with SAC EFTS Students recorded in the SDR with funding codes “01”, “25” and “26” Māori students Students at the time of enrolment who have identified themselves as Māori Pacific students Students at the time of enrolment who have identified themselves as Pacific Students under 25 years Students who are aged 24 years or younger on 1 July 2013 Participation This measure the proportion of EFTS delivered for target groups of students in a calendar year Formula:

Total EFTS delivered for a group of interest (i.e. Māori) in 2013 x 100 Total EFTS delivered in 2013 Successful course completion Successful course completion relates to courses, papers or modules that lead to a recognised qualification. The rate is an EFTS weighted metric that takes into account the workload of the course and EFTS delivered during the total period of the course enrolment. Formula: EFTS delivered for the total number of successfully completed course enrolments ending in 2013 x 100 EFTS delivered for the total number of course enrolments ending in 2013

Qualification completion rate A qualification is completed when a student successfully completes all the requirements for the award of a qualification such as a degree, diploma or certificate. The rate is an EFTS weighted metric that takes into account the relative size of the different qualifications. The 2013 qualification completion figures given in this report were those at 31 January 2014. These figures are still provisional and are likely to increase as more awards are validated and recorded. Formula: (Sum of qualification completions in 2013 multiplied by EFTS value of the qualification) x 100 EFTS delivered for the total number of course enrolments ending in 2013 Student retention rate This measure is based on the proportion of individual students (not EFTS) enrolled in one year that either re-enrol in any course in the following year or successfully complete their qualification. Formula: Students re-enrolled in 2013 or completed in 2012 or 2013 x 100 Students with some portion of an enrolment in 2012 Student progression This measures the progression of students who complete a qualification and move on within 12 months to pursue a qualification at a higher level either at Whitireia or another tertiary education provider in New Zealand. This data is supplied by TEC and not finalised until TEC receives the April 2014 SDR from the tertiary education providers in May 2014. Whitireia expects TEC to provide finalised data in July 2014. For Levels 1-3, the indicator measures student re-enrolment at Level 4 or above e.g.: Formula: Number of students enrolled at a higher qualification level within 12 months following the qualification completion x 100 Number of students completing a qualification at Levels 1-3 in previous year Levels of study This refers to Levels 1-10 on the National Qualification Framework. For more information visit NZQA website: www.nzqa.govt.nz/studying-in-new-zealand/nzqf/nzqf-levels

ANNUAL REPORT 2013

Percentage of income from non-government sources Formula: Income from total non-government sources x 100 Total income received

Surplus percentage Formula: Total revenue x 100 Total operational expenses

Student Satisfaction Survey The 2013 survey delivery was changed from paper based to online base using www.questionpro.com between 10 October and 4 November 2013. Students were encouraged to participate with links on Moodle, Facebook and 4,786 received an email invite with a link to participate resulting in 1,069 students participated in the online based survey. This is a reduction of 1,069 participants on last yearâ&#x20AC;&#x2122;s survey of 2,315 participants. Results were imported into a database, analysed and reported back to Faculty Deans, Programme Managers and Executive. Graduate Satisfaction Survey The 2013 Graduate Satisfaction Survey delivery was changed from phone based conducted in the first half of the year to being part of the application to graduate form. The change took effect from the July 2013 graduations where applicants answered three key questions. This meant the March 2013 graduates were not given an opportunity to participate thus the 2013 survey was down 76 on last yearâ&#x20AC;&#x2122;s phone based survey of 770 participants. 929 students eligible to graduate received the application to graduate form, 694 participated in the survey. Responses were entered into a database from the application to graduate forms, analysed and reported back to Faculty Deans, Programme Managers and Executive. Teaching staff to student ratio Staff members that are identified as teaching staff are expressed as FTE to all EFTS reported in the December 2013 SDR. EFTS FTE

Natalie Smith, visual arts and design student won the Mana Zonta Design award. The award was for outstanding drive and motivation for design, academic standards, and for her contribution to design research, aimed at commercialisation.

ANNUAL REPORT 2013

Financial Statements The accompanying accounting policies and notes form an integral part of these financial statements

Financial Statements Statement of Financial Performance for the year ended 31 December 2013 Group

Note

Polytechnic

Actual 2013 $'000

Budget 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

Revenue Government grants

29,677

30,098

29,514

26,228

26,651

Tuition fees

26,768

30,049

28,131

23,197

25,169

237

168

523

169

467

4,187

3,982

4,603

6,114

6,375

60,910

64,297

62,771

55,749

58,662

Interest Revenue from other operating activities Change in fair value of investment property Total revenue Operating expense Personnel costs

32,286

32,703

32,848

32,286

32,848

Depreciation expenses

4,159

4,076

3,720

4,164

3,725

Amortisation expenses

289

319

285

289

285

Course related expenses

2,689

3,036

2,784

2,674

2,784

Occupancy costs

5,093

4,964

4,487

5,093

4,487

Project expenditure

8,087

8,108

8,339

3,142

4,411

Trading activities

397

406

421

397

421

8,237

9,224

8,639

8,179

8,543

61,237

62,837

61,523

56,224

57,504

(327)

1,460

1,248

(475)

1,158

(1,582)

(250)

(1,446)

(1,582)

(1,446)

221

216

Total non-operating items

(1,361)

(179)

(1,230)

(1,582)

(1,446)

Surplus / (deficit) before taxation

(1,688)

1,281

(2,057)

(288)

(1,699)

1,281

(2,057)

(288)

Other expenses

Total operating expenses Surplus / (deficit) before non-operating items Non-operating items Non-operating income / (expense) items Share of net profit / (loss) of jointly controlled entities

Taxation Surplus / (deficit) after taxation

The accompanying notes form part of these financial statements

ANNUAL REPORT 2013

Statement of Comprehensive Income for the year ended 31 December 2013 Group

Note

Polytechnic

Actual 2013 $'000

Budget 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

(1,699)

1,281

(2,057)

(288)

(Loss) on property revaluations

(382)

(415)

(382)

(415)

Total other comprehensive income

(382)

(415)

(382)

(415)

(2,081)

1,281

(397)

(2,439)

(703)

Surplus / (deficit) Other comprehensive income

Total comprehensive income

Statement of Changes in Equity for the year ended 31 December 2013 Group

Note

Polytechnic

Actual 2013 $'000

Budget 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

63,116

64,470

63,513

63,041

63,744

(1,699)

1,281

(2,057)

(288)

(382)

(415)

(382)

(415)

Total comprehensive income

(2,081)

1,281

(397)

(2,439)

(703)

Balance at 31 December

61,035

65,751

63,116

60,602

63,041

Balance at 1 January Comprehensive income Surplus / (deficit) Other comprehensive income

The accompanying notes form part of these financial statements

Statement of Financial Position as at 31 December 2013

Group

Note

Polytechnic

Actual 2013 $'000

Budget 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

Assets Current assets Cash and cash equivalents

2,851

3,841

572

2,781

493

Debtors and other receivables

6,430

6,778

8,428

4,011

3,592

Inventory

179

142

179

142

240

273

240

273

358

346

2,348

2,000

Prepayments Taxation asset Current portion of financial assets in nature of investments Assets held for sale

9 14

Total current assets

1,570

10,072

11,100

13,367

7,211

8,070

1,356

Non-current assets Financial assets in the nature of investments

1,356

Investment in joint controlled entity

577

356

140

Property, plant and equipment

72,010

75,447

71,681

72,036

71,711

Intangible assets

1,616

1,351

1,683

855

922

Investment properties

321

280

321

280

Assets held for sale Total non-current assets

9 74,543

77,097

9 74,019

9 74,717

9 74,418

84,615

88,197

87,386

81,928

82,488

Total assets Liabilities Current liabilities Creditors and other payables

4,910

3,476

7,503

3,794

3,408

Special accounts Revenue received in advance

16 17

164 11,642

139 12,669

94 10,501

164 9,193

97 8,430

Employee entitlements (CL)

3,258

3,318

3,160

3,247

3,160

Current provisions

346

269

225

346

225

Loan from controlled entity

1,322

1,340

20,320

19,871

21,483

18,066

16,660

Total current liabilities Non-current liabilities Employee entitlements (NCL)

180

232

180

232

Provisions

3,080

2,343

2,555

3,080

2,555

3,260

2,575

2,787

3,260

2,787

Total liabilities

23,580

22,446

24,270

21,326

19,447

Net assets

61,035

65,751

63,116

60,602

63,041

Total non-current liabilities

Equity General reserves

43,944

47,875

45,643

43,523

45,580

Property revaluation reserve

17,079

17,876

17,461

17,079

17,461

Restricted reserves

61,035

65,751

63,116

60,602

63,041

Total equity

48 The accompanying notes form part of these financial statements

ANNUAL REPORT 2013

Statement of Cash Flows for the year ended 31 December 2013 Group

Note

Polytechnic

Actual 2013 $'000

Budget 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

Receipt of government grants

29,676

30,098

29,753

26,228

26,890

Receipt of student tuition fees

29,905

27,565

24,804

23,540

24,603

4,188

6,294

4,583

6,115

6,357

237

168

523

169

466

Cash flows from operating activities

Receipt of other ancilliary income Interest received Net taxation received / (paid)

(23)

682

(90)

682

Payment to employees

(32,711)

(32,703)

(32,715)

(32,723)

(32,677)

Payments to suppliers

(27,968)

(25,915)

(22,709)

(19,992)

(21,390)

4,018

5,417

4,216

4,019

4,249

(5,038)

(8,501)

(14,275)

(5,080)

(14,277)

(222)

(670)

(222)

(670)

(140)

1,530

1,571

1,991

2,000

4,991

2,000

5,003

(1,739)

(6,501)

(10,078)

(1,731)

(10,068)

2,279

(1,084)

(5,862)

2,288

(5,819)

572

4,925

6,434

493

6,312

2,851

3,841

572

2,781

493

GST

Net cash flow from operating activities Cash flow from investing activities Purchase of property, plant and equipment Purchase of intangibles Investment in jointly controlled entity Proceeds from sale of property, plant and equipment Sale of financial assets in the nature of investments Net cash flow used in investing activities Net (decrease) / increase in cash and cash equivalents Cash and cash equivalents at the beginning of the period Cash and cash equivalents at the end of the period

The GST (net) component of operating activities reflects the net GST paid and received with the Inland Revenue Department. The GST (net) component has been presented on a net basis, as the gross amounts do not provide meaningful information for financial statement purposes, and to be consistent with other primary financial statements.

The accompanying notes form part of these financial statements

Reconciliation from the net surplus / (deficit) to the net cash flow from operations

Group

Polytechnic

Actual 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

(1,699)

(2,057)

(288)

Depreciation

4,159

3,720

4,164

3,725

Amortisation

289

285

289

285

Surplus / (deficit) from the statement of comprehensive income Adjustment for:

Loss / (profit) on disposal of assets

210

(16)

210

(16)

Fair value increase in investments

(41)

(215)

(41)

Surplus on joint venture

(221)

Non-cash lease inducement amortisation

(225)

(177)

(225)

(177)

103

(25)

4,274

3,629

4,372

3,849

(38)

(50)

(38)

(50)

Movement in bad debt provision Total non-cash items Add / less movements in working capital items (Increase) in inventories Decrease / (increase) in trade and other receivables

1,894

(1,731)

(395)

3,101

Decrease / (increase) in prepayments

(200)

Decrease / (increase) in taxation

(23)

(18)

1,308

(2,523)

4,067

455

1,141

(1,627)

763

(3,698)

(Decrease) / increase in loan to controlled entity (Decrease) / increase in trade and other payables Increase / (decrease) in revenue received in advance Increase in employee entitlements

133

171

871

Net movement in working capital items

1,443

569

1,704

688

Net cash flow from operating activity

4,018

4,216

4,019

4,249

Increase in provisions

The accompanying notes form part of these financial statements

ANNUAL REPORT 2013

Notes to the Financial Statements 1. Statement of accounting policies for the year ended 31 December 2013 Reporting entity Whitireia Community Polytechnic (the Polytechnic) is a Tertiary Education Institution (TEI) domiciled in New Zealand and is governed by the Crown Entities Act 2004 and the Education Act 1989. The Polytechnic and group consists of Whitireia Community Polytechnic and its subsidiaries, Whitireia New Zealand Limited (WNZL) (100% owned) and Whitireia Foundation (100% interest). All subsidiaries are incorporated and domiciled in New Zealand. The Polytechnic has consolidated the accounts of the Whitireia Foundation for financial reporting purposes because in substance, the Polytechnic predetermined the objectives of the Foundation at establishment and benefits from the Foundationâ&#x20AC;&#x2122;s complementary activities. The primary objective of the Polytechnic and group is to provide tertiary education services for the benefit of the community rather than making a financial return. Accordingly, the Polytechnic has designated itself and the group as public benefit entities for the purposes of New Zealand equivalents to International Financial Reporting Standards (NZ IFRS). The financial statements of the Polytechnic and group are for the year ended 31 December 2013. The financial statements were authorised for issue by the Council on 16 April 2014.

Basis of preparation Statement of compliance The financial statements of the Polytechnic 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). These financial statements have been prepared in accordance with NZ GAAP. They comply with NZ IFRS, and other applicable financial reporting standards as appropriate for public benefit entities. Measurement base The financial statements have been prepared on a historical cost basis, modified by the revaluation of investment properties, assets classified as held for sale, land and buildings. Functional and presentation accuracy The financial statements are presented in New Zealand dollars and all values are rounded to the nearest thousand dollars ($000). The functional currency of the Polytechnic and its subsidiaries is New Zealand Dollars (NZ$). Changes in accounting policies There have been no changes in accounting policies during the financial year.

Standards, amendments and interpretations issued that are not yet effective and have not been early adopted The Minister of Commerce has approved a new Accounting Standards Framework (incorporating a Tier Strategy) developed by the External Reporting Board (XRB). Under this Accounting Standards Framework, the Polytechnic is classified as a Tier 1 reporting entity and it will be required to apply full Public Benefit Entity Accounting Standards (PAS). These standards have been issued by the XRB based on current International Public Sector Accounting Standards. The effective date for the new standards for public sector entities is for reporting periods beginning on or after 1 July 2014. This means the Polytechnic expects to transition to the new standards in preparing its 31 December 2015 financial statements. In the interim public benefit entities are governed by NZ IFRS but any changes to NZ IFRS do not apply. The Polytechnic does not expect there to be a major impact on the adoption of PAS, however there could be an impact on the recognition of non-exchange revenue.

Significant accounting policies Basis of consolidation The group financial statements are prepared by adding together like items of assets, liabilities, equity, income, expenses, and cash flows on a line-by-line basis. All significant intragroup balances, transactions, income, and expenses are eliminated on consolidation. Subsidiaries The Polytechnic consolidates in the group financial statements all entities where the Polytechnic has the capacity to control the financing and operating policies of an entity so as to obtain benefits from the activities of the entity. This power exists where the Polytechnic controls the majority voting power on the governing body or where such policies have been irreversibly predetermined by the Polytechnic 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. Inter-company transactions, balances and unrealised gains on transactions between group entities are eliminated. Unrealised losses are also eliminated. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the group. The cost of a business combination is measured as the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, in exchange for control of the subsidiary. Any excess of the cost of the business combination over the Polytechnic’s interest in the net fair value of the identifiable assets, liabilities, and contingent liabilities is recognised as goodwill. If the Polytechnic’s interest in the net fair value of the identifiable assets, liabilities, and contingent liabilities recognised exceeds the cost of the business combination, the difference will be recognised immediately in the surplus or deficit as a bargain purchase. Investments in subsidiaries are carried at cost in the Polytechnic’s parent entity financial statements. Jointly controlled entity The Polytechnic and group’s jointly controlled entity interest is accounted for using the equity method. Investments in jointly controlled entities are initially recognised at cost and the carrying amount is increased or decreased to recognise the appropriate share of the profit or loss of the jointly controlled entity after the date of acquisition. The Polytechnic and group's share of the profit or loss is recognised in the group profit or loss. Distributions received from a jointly controlled entity reduce the carrying amount of the investment in the group financial statements.

ANNUAL REPORT 2013

If the share of losses of a jointly controlled entity equals or exceeds the interest in the jointly controlled entity, the group discontinues recognising its share of further losses. After the groupâ&#x20AC;&#x2122;s interest is reduced to zero, additional losses are provided for, and a liability is recognised, only to the extent that the group has incurred legal or constructive obligations or made payments on behalf of the jointly controlled entity. If the jointly controlled entity subsequently reports profits, the group will resume recognising its share of those profits only after its share of the profits equals the share of losses not recognised. Where the group transacts with a jointly controlled entity, profit or losses are eliminated to the extent of the groupâ&#x20AC;&#x2122;s interest in the relevant jointly controlled entity. Investments in a jointly controlled entity are carried at cost in the Polytechnic parent entity financial statements. Revenue Revenue is measured at the fair value of consideration received or receivable. Government grants and research income Government grants and research income are recognised as revenue upon entitlement unless there is an obligation to return the funds if conditions of the grant are not met. If there is such an obligation, the grants are initially recorded as grants received in advance and recognised as revenue when conditions of the grants are satisfied. Student tuition fees Student tuition fees are recognised as revenue on a course percentage of completion basis. The percentage of completion is measured by reference to the days of the course completed as a proportion of total course days. The balance is recognised as revenue in advance. Sale of goods Revenue from sale of goods is recognised when the product is sold to the customer. Interest and dividends Interest income is recognised using the effective interest method. Dividends are recognised when the right to receive payment has been established. Leases Finance leases A finance lease is a lease that transfers to the lessee substantially all the risks and rewards incidental to ownership of an asset, whether or not title is eventually transferred. At the commencement of the lease term, finance leases are recognised as assets and liabilities in the statement of financial position at the lower of the fair value of the leased item or the present value of the minimum lease payments. The finance charge is charged to the surplus or deficit over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability. The amount recognised as an asset is depreciated over its useful life. If there is no certainty as to whether the Polytechnic and group will obtain ownership at the end of the lease term, the asset is fully depreciated over the shorter of the lease term and its useful life. Operating lease An operating lease is a lease that does not transfer substantially all the risks and rewards incidental to ownership of an asset. Lease payments net of lease inducements under an operating lease are recognised as an expense on a straight-line basis over the lease term.

Cash and cash equivalents Cash and cash equivalents includes cash on hand, deposits held at call with banks other short-term highly liquid investments with original maturities of three months or less. Debtors and other receivables Short-term debtors and other short-term receivables are recorded at amortised cost less any provision for impairment. Foreign currency transactions Foreign currency transactions are translated into NZ$ (the functional currency) using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year end of monetary assets and liabilities denominated in foreign currencies are recognised in the surplus or deficit. Other financial assets (including investment in other entities) 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. Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Polytechnic and group has transferred substantially all the risks and rewards of ownership. Financial assets are classified, for the purposes of measurement, as loans and other receivables. Classification of the financial asset depends on the purpose for which the instruments were acquired. 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. Related party receivables that are repayable on demand are classified as a non-current asset because repayment of the receivable is not expected within 12 months of the balance date. After initial recognition loans and receivables are measured at amortised cost using the effective interest method less any provision for impairment. Gains and losses when the asset is impaired or derecognised are recognised in the surplus or deficit. Impairment of financial assets At each balance date, the Polytechnic and group assesses whether there is any objective evidence that a financial asset or group of assets is impaired. Any impairment losses are recognised in surplus or deficit. Loans and receivables (including cash and cash equivalents and debtors and other receivables) Impairment of a loan or a receivable is established when there is objective evidence that the Polytechnic and group will not be able to collect amounts due according to the original terms of the debt. Significant financial difficulties of the debtor, probability that the debtor will enter into bankruptcy and the default in payments are considered indicators that the asset is impaired. The amount of the impairment is the difference between the assetâ&#x20AC;&#x2122;s carrying amount and the present value of estimated future cash flows, discounted using the original effective interest rate. For debtors and other receivables, the carrying amount of the asset is reduced through the use of an allowance account, and the amount of the loss is recognised in the surplus or deficit. When the receivable is uncollectible, it is written-off against the allowance account. Overdue receivables that have been renegotiated are reclassified as current (i.e. not past due). For other financial assets, impairment losses are recognised directly against the instruments carrying amount.

ANNUAL REPORT 2013

Inventories Inventories held for distribution or consumption in the provision of services that are not supplied in a commercial basis are measured at cost (using the FIFO method), adjusted when applicable, for any loss of service potential. Where inventories are acquired at no cost or for nominal consideration, the cost is the current replacement cost at the date of acquisition. The amount of any write-down for the loss of service potential or from cost to net realisable value is recognised in the surplus or deficit in the period of the write-down. Property, plant and equipment Property, plant and equipment consists of the following asset classes: land and buildings, plant and machinery, motor vehicles, computer hardware, furniture, fittings and artwork, library collection, office equipment, teaching equipment, leasehold improvements, communication systems and signage. Land is measured at fair value and buildings are measured at fair value less accumulated depreciation and impairment losses. All other asset classes are measured at deemed cost on acquisition less any accumulated depreciation and impairment losses. Revaluations Land and buildings are revalued with sufficient regularity to ensure that the carrying amount does not differ materially from fair value at least every two years. The carrying values of revalued assets are assessed biannually by independent valuers 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. Land and buildings revaluation movements are accounted for on a class of asset basis. The net revaluation results are credited or debited to other comprehensive income and is 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 income 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 deficit will be recognised first in the surplus or deficit up to the amount previously expensed, and then recognised in other comprehensive income. 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 the Polytechnic 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 at no cost, or for a nominal cost, it is recognised at fair value as at the date of acquisition. Disposals Gains and losses on disposals are determined by comparing the disposal proceeds with the carrying amount of the asset. Gains and losses on disposals are reported net in the surplus or deficit. When revalued land and building assets are sold, the amounts included in property revaluation reserves in respect of those land and building assets are transferred to general funds.

Depreciation Depreciation is provided on a straight-line basis on all property, plant, and equipment other than land and work in progress at rates that will write off the cost, (or valuation) of the assets to their 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 assets

Life

Rate

Buildings

10-50 years

2% - 10% per annum

Plant and machinery

8-10 years

10% - 12.5% per annum

Motor vehicles

5 years

20% per annum

Computer hardware

5 years

20% per annum

Furniture and fittings

10 years

10% per annum

Library collection

5-8 years

12.5% per annum

Office equipment

5 years

20% per annum

Teaching equipment

5 years

20% per annum

Leasehold improvements

1-12 years

8% - 100% per annum

Communication systems

4 years

25% per annum

Signage

4 years

25% per annum

Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful lives of the improvements, whichever is the shorter. The unexpired period of the lease includes any rights of renewal where management considers it reasonably certain that these rights be exercised. The residual value and useful life of an asset is reviewed and adjusted if applicable, at each financial year end. Intangible assets Software acquisition and development Acquired computer software licenses are capitalised on the basis of the costs incurred to acquire and bring to use to specific software. Costs that are directly associated with the development of software for internal use, are recognised as an intangible asset. Direct costs include the software development employee costs and an appropriate portion of relevant overheads. Staff training costs are recognised as an expense when incurred. Costs associated with maintaining computer software are recognised as an expense when incurred. Course development costs Course development costs relate to development of educational courses and are capitalised if purchased wholly from other institutes of learning.

ANNUAL REPORT 2013

Amortisation The carrying value of an intangible asset with a finite life is amortised on a straight-line basis over its useful life. Amortisation begins when the asset is available for use and ceases at the date that the asset is derecognised. The amortisation charge for each period is recognised in the surplus or deficit. The useful lives and associated amortisation rates of major classes of intangible assets have been estimated as follows: Class of assets

Life

Rate

Computer software

3 years

33% per annum

Course development costs

3 years

33% per annum

The amortisation period and amortisation method for each class of intangible asset having a finite life is reviewed at each financial year end. If the expected useful life or expected pattern of consumption is different from the previous assessment, changes are made accordingly. 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. Impairment of property, plant, equipment and intangible assets Intangible assets that have an indefinite useful life, or not yet available for use, and goodwill, 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 there is an indicator of impairment the asset’s 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. Value in use is depreciated replacement cost for an asset where the future economic benefits and service potential are not primarily dependent on the asset’s ability to generate net cash inflows and where the Polytechnic and group would, if deprived of the asset, replace its remaining future economic benefits or service potential. 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. For revalued assets the impairment loss is recognised in other comprehensive income to the extent the impairment loss does not exceed the amount in the revaluation reserve in equity for that same class of asset. Where that results in a debit balance in the revaluation reserve, the balance is recognised in the surplus or deficit. For assets not carried at a revalued amount, the total impairment loss is recognised in the surplus or deficit. Impairment related to goodwill cannot be reversed. The reversal of an impairment loss on a revalued asset is credited to other comprehensive income and increases the asset revaluation reserve for that class of asset. However, to the extent that an impairment loss for that class of asset was previously recognised in the surplus or deficit, a reversal of the impairment loss is also recognised in the surplus or deficit. For assets not carried at a revalued amount the reversal of an impairment loss is recognised in the surplus or deficit.

Investment properties and assets held for sale Properties held for sale or leased to third parties under operating leases are classified as 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 cost. Subsequent to initial recognition investment properties are measured at fair value as determined annually by an independent valuer. Gains and losses arising from a change in the fair value of investment properties are recognised in the surplus or deficit. Creditors and other payables Creditors and other payables are initially measured at fair value and subsequently measured at amortised cost using the effective interest method. Employee entitlements Short-term employee entitlements Employee benefits that are due and settled within 12 months after the end of the period in which the employee renders the related service are measured at nominal values based on accrued entitlements at current rates of pay. These include salaries and wages and annual leave earned but not yet taken at balance date, and sick leave. A liability for sick leave is recognised to the extent that 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 it will be used by staff to cover those future absences. Long-term employee entitlements Employee benefits that are due to be settled beyond 12 months after the end of period in which the employee renders the related service, such as long service leave and retirement gratuities, have been calculated on an actuarial basis. The calculations are based on: â&#x20AC;˘

Likely future entitlements accruing to staff, based on years of service, years to entitlement, the likelihood that staff will reach the point of entitlement, and contractual entitlement information, and

â&#x20AC;˘

The present value of the estimated future cash flows

Expected future payments are discounted using market yields on government bonds at balance date with terms to maturity that match, as closely as possible, the estimated future cash outflows for entitlements. The inflation factor is based on the expected long-term increase in remuneration for employees. Presentation of employee entitlements Sick leave, annual leave, vested long service leave, non-vested long service leave and retirement gratuities expected to be settled within 12 months of the balance date, are classified as current liability. All other employee entitlements are classified as a non-current liability. Superannuation schemes Defined contribution schemes Obligations for contributions to KiwiSaver and the Government Superannuation Fund are accounted for as defined contribution schemes recognised as an expense in the surplus or deficit as incurred.

ANNUAL REPORT 2013

Provisions 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 expenditures will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation. Provisions are measured at the present value of the expenditures expected to be required to settle the obligation using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the obligation. The increase in the provision due to the passage of time is recognised as an interest expense and is included as “finance costs”. Equity Equity is measured as the difference between total assets and total liabilities. Equity is disaggregated and classified into a number of components. The components of equity are: •

General funds

•

Property revaluation reserves

•

Fair value through comprehensive income reserves and

•

Restricted reserves

Restricted reserves Restricted reserves are a component of equity generally representing a particular use to which various parts of equity have been assigned. Reserves may be legally restricted or created by the Polytechnic. Transfers from these reserves may be made only for certain specified purposes or when certain specified conditions are met. Property revaluation reserves This reserve relates to the revaluation of property to fair value. Goods and Services Tax (GST) All items in the financial statements are stated exclusive of GST, except for debtors and other receivables and creditors and other payables, which are presented on a GST inclusive basis. Where GST is not recoverable as input tax then it is recognised as part of the related asset or expense. The net amount of GST recoverable from, or payable to, the Inland Revenue Department (IRD) is included as part of receivables or payables in the Statement of Financial Position. The net GST paid to, or received from, the IRD, including GST relating to investing and financing activities, is classified as net operating cash flow in the Statement of Cash Flows. Commitments and contingencies are disclosed exclusive of GST. Income Tax Whitireia Community Polytechnic is exempt from income tax, pursuant to section 55BA of the Income Tax Act 2007. Whitireia Foundation is exempt from income tax, pursuant to sections CW 41 and 42 of the Income Tax Act 2007. However, Whitireia New Zealand Limited does not qualify for any exemption from income tax. The tax expense for the period comprises current and deferred tax. Tax is recognised in the income statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, the tax is also recognised in other comprehensive income or directly in equity, respectively. The current income tax charge is calculated on the basis of the tax laws enacted or substantively enacted at the balance date where operations result in generating taxable income. Management periodically evaluates positions taken in tax returns with respect to situations in which applicable tax regulation is subject to interpretation. It establishes provisions where appropriate on the basis of amounts expected to be paid to the tax authorities.

Deferred income tax is recognised, using the liability method, on temporary differences arising between the tax bases of assets and liabilities and their carrying amounts in the consolidated financial statements. However, deferred tax liabilities are not recognised if they arise from the initial recognition of goodwill; deferred income tax is not accounted for if it arises from initial recognition of an asset or liability in a transaction other than a business combination that at the time of the transaction affects neither accounting nor taxable profit or loss. Deferred income tax is determined using tax rates (and laws) that have been enacted or substantially enacted by balance sheet date and are expected to apply when the related deferred income tax asset is realised or the deferred income tax liability is settled. Budget figures The budget figures are those that are approved by the Council at the start of the financial year. The budget figures have been prepared in accordance with NZ GAAP, using accounting policies that are consistent with those adopted by the Council in the preparation of the financial statements. Critical accounting estimates and assumptions In preparing these financial statements the Polytechnic and group has made estimates and assumptions concerning the future. These estimates and assumptions may differ from the subsequent actual results. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are discussed below: Property revaluations Note 11 provides information about the estimates and assumptions exercised in the measurement of revalued land and buildings. Estimated impairment of goodwill The group tests annually whether goodwill has suffered any impairment, in accordance with the stated accounting policy. The recoverable amounts of cash-generating units have been determined based on valuein-use calculations. These calculations require the use of estimates (refer note 12). Employee entitlements Refer to accounting policy for critical estimates and judgements for employee entitlements. Critical judgements in applying accounting policies Management have exercised the following critical judgements in applying accounting policies for the year ended 31 December 2013: Crown owned land and buildings Property in the legal name of the Crown that is occupied by the Polytechnic and group is recognised as an asset in the Statement of Financial Position. The Polytechnic and group consider it has assumed all the normal risks and rewards of ownership of this property despite legal ownership not being transferred and accordingly it would be misleading to exclude these assets from the financial statements. Distinction between revenue and capital contributions Most Crown funding received is operational in nature and 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, the Polytechnic and group accounts for the funding as a capital contribution directly in equity. Information about capital contributions recognised in equity is disclosed in note 20.

ANNUAL REPORT 2013

Income

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

29,249

29,079

25,800

26,216

Performance-based research funding

168

Other government grants

260

357

260

357

29,677

29,514

26,228

26,651

Total government grants

iii.

Polytechnic

Government grants Student Achievement Component (SAC) funding

ii.

Group

Tuition fees

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Domestic fees

12,437

International fees

14,331

13,960

9,463

10,998

14,171

13,734

14,171

Total tuition fees

26,768

28,131

23,197

25,169

Other income Group

Donations and koha Rental revenue Education service contracts Bookshop income Gain on sale of property, plant and equipment

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

215

368

215

358

1,900

2,261

3,917

4,121

293

333

294

333

Other income

1,699

1,558

1,688

1,547

Total other income

4,187

4,603

6,114

6,375

Personnel Costs

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Academic salaries

17,429

17,416

17,429

17,416

General salaries and wages

14,272

15,023

14,272

15,023

600

276

600

276

Defined contribution plan employer contributions Increase / (decrease) in employee entitlements Total personnel costs

(15)

133

(15)

133

32,286

32,848

32,286

32,848

Employer contributions to defined contribution plans include contributions to KiwiSaver and the Government Superannuation Fund.

Other Expenses

Polytechnic

Actual 2013 $'000

Actual 2012 $'000

Actual 2013 $'000

Actual 2012 $'000

151

158

114

111

(1)

Advertising and public relations

583

844

583

844

Bad debts expensed

105

102

Audit fees - current year Audit fees - prior years

Bank charges Catering Commissions paid Consultants and legal

202

213

202

211

2,118

1,989

2,118

1,989

425

483

408

478

Consumables

Councillor fees

104

Councillor fees - prior year Directors fees Equipment lease

530

367

530

367

Export education levy

Fees and subscriptions

276

252

276

252

Graduation costs

131

126

131

126

Grants and scholarships Immigration Visa fees

1,289

1,065

1,289

1,065

558

459

558

459

(1)

International contacts activities

Motor vehicle expenses

Office costs

363

399

363

398

Other operating

131

368

128

366

100

107

179

107

178

174

153

601

773

601

773

Information technology Insurance Interest paid

Postage Professional development fees Repairs and maintenance information technology Sundry expenses Travel and accommodation

Group

Whitireia scholarships

Total other expenses

8,237

8,639

8,179

8,543

ANNUAL REPORT 2013

Non-operating Expense

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Restructuring

210

175

210

175

Redundancies

472

124

472

124

Loss on disposal of fixed assets

210

Contract settlement

690

Media Training Centre temporary relocation due to seismic issues

239

Impairment of leasehold improvements

807

Fixed asset write-off Total current portion

101

1,582

1,446

1,582

1,446

Contract settlement During November 2013 Whitireia negotiated a contract with a new provider of multi-function devices as a result of the strategic partnership with WelTec. This amount represents the cost of exiting the current contract with the incumbent supplier. Media Training Centre relocation (prior year) In December 2011 the Whitireia Council decided to relocate the Media Training Centre in Wellington from Cuba Street. An alternative premises was provided by the landlord in Dixon Street. The costs above were for the cost of fitting out the temporary campus. Impairment of leasehold improvements (prior year) Due to the uncertainty over the timing of the seismic strengthening at 107 Cuba Street, a provision has been allowed for the impairment of the leasehold fitout. Fixed asset write-off (prior year) This is a one-off adjustment required to align the general ledger with the fixed asset register to correct historical transactions entered incorrectly.

Cash and Cash Equivalents

Cash at bank and in hand Term deposits with maturities less than three months Total cash and cash equivalents

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

2,822

507

2,781

493

2,851

572

2,781

493

The carrying value of cash at bank, call deposits and term deposits with original maturities less than three months approximates to their fair value.

Debtors and Other Receivables

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

4,568

3,741

3,568

2,917

Student receivables Student fees receivables Provision for impairment

(178)

(74)

(50)

(74)

Net student fee receivables

4,390

3,667

3,518

2,843

Other receivables Other debtors and receivables

2,040

4,761

493

749

Total debtors and other receivables

6,430

8,428

4,011

3,592

Fair value Student fees are due before a course commences or are due on enrolment if the course has already begun. Student fee receivables are non-interest bearing and are payable in full by course commencement date. Therefore, their carrying value approximates their fair value. Other receivables are non-interest bearing and are generally settled on 30-day terms. Therefore, the carrying value of other receivables approximates their fair value.

Impairment The ageing profile of student fee receivables at year end is detailed below: Group

Polytechnic

Gross $’000

Impairment $’000

Net $’000

Gross $’000

Impairment $’000

Net $’000

3,009

2,635

Past due 31 - 60 days

996

709

Past due 61 - 90 days

137

113

2013 Not past due

Past due over 90 days

426

(178)

248

111

(50)

4,568

(178)

4,390

3,568

(50)

3,518

Not past due

1,634

Past due 31 – 60 days

1,088

886

Past due 61 – 90 days

338

238

Past due over 90 days

681

(74)

607

159

(74)

3,741

(74)

3,667

2,917

(74)

2,843

Total 2012

Total

Due to the large number of student fee receivables, the impairment assessment is performed on a collective basis, based upon an analysis of past collection history and debt write-offs.

ANNUAL REPORT 2013

Movements in the provision for impairment of student fee receivables are as follows: Group

At 1 January Additional provisions made during the year Receivables written off during the year At 31 December

Inventories

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

215

(111)

(17)

(111)

(17)

178

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

137

Materials and consumables

Inventory work in progress

179

142

179

142

Inventories held for resale

Total inventories

During the year inventories with a cost value of $344,000 (2012:$362,000) has been included in trading activity expenditure on the Statement of Financial Performance.

Financial Assets in the Nature of Investments

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

229

Effective interest rate %

Maturity

ASB - Foundation

4.20%

Various

ASB - Foundation

4.50%

Various

348

ASB - Foundation

4.30%

129

ANZ National Bank

4.50%

Various 11-Jan2013

2,000

358

2,348

2,000

Current Deposits with banks

Non-current Investments in controlled entity (at cost) Shares in unlisted entities (at cost)

1,346

1,356

The deposit with banks classified as current assets are those with original maturing periods of greater than three months and less than twelve months. The investment in controlled entity is for WNZL (100% owned). During 2012 the Polytechnic’s subsidiary, WNZL acquired the delivery of two private training establishments. The delivery of The New Zealand Film and Television School, which operates in Wellington was acquired on 1 July 2012.

10. Investment in Jointly Controlled Entities The Polytechnic and WelTec each have a 50% interest in two joint ventures, Computer Power Plus (CPP) and W2. CPP undertakes academic and support services on contract to WNZL. W2 provides shared services to Whitireia and WelTec. The investments are carried at fair value based on the Polytechnic’s share of the assets, liabilities, income and expenses of the joint ventures: Actual 2013 $’000

Budget 2013 $’000

Actual 2012 $’000

Parent Investment in Computer Power Plus

140

Group Investment in Computer Power Plus

577

427

356

Assets Current assets

632

703

111

705

814

Liabilities Current liabilities

(128)

(458)

Total liabilities

(128)

(458)

Income

2,443

1,964

(2,222)

(1,748)

221

216

763

149

Non-current assets Total assets

Expenses Profit / loss Share of joint venture's contingent liabilities Share of joint venture's commitments

Computer Power (NZ) Limited was placed into liquidation on 19 March 2012. At the request of TEC, NZQA and the liquidator, WNZL entered into a licence agreement from 2 April 2012 to operate the business before formally purchasing the assets and delivery on 1 May 2012. WNZL has adopted the trading name Computer Power Plus and worked with the Polytechnic and WelTec to continue delivery at the campuses in Auckland, Wellington and Christchurch. Refer also to note 25.

Net book value

58,685

2,546

Accumulated depreciation at 31 December 2013

Revaluations / impairment

Recognition of leasehold inducement reversal

1,134

(5,228)

(639)

(1,550)

Current year depreciation

(4,590)

Disposals during the year

Accumulated depreciation at 1 January 2013 (996)

58,685

Accumulated depreciation

15,615

Transfers

Cost / valuation at 31 December 2013 6,362

(6)

6,257

Transfer to property held for sale

(2,926)

Revaluations

Additions during the year

45,926

$’000

Disposals during the year

Cost / valuation at 1 January 2013

Cost / valuation

Group

Computer hardware

Land & buildings

11. Property, Plant and Equipment

1,279

(1,718)

(206)

(1,512)

2,997

455

(6)

2,535

$’000

Furniture fittings & artwork

780

(2,039)

(203)

(1,836)

2,819

(1)

179

2,641

$’000

Library collection

278

(716)

(71)

(645)

994

(1)

972

$’000

Plant & machinery

123

(635)

(51)

(594)

758

(19)

685

$’000

Motor vehicles

(406)

(16)

(390)

440

427

$’000

Office equipment

876

(2,660)

(393)

(2,267)

3,536

(4)

150

3,389

$’000

Teaching equipment

8,353

(3,326)

(103)

(1,087)

(2,210)

11,679

241

(224)

436

11,200

$’000

Leasehold improvements

338

(834)

(136)

(699)

1,172

(1)

1,158

$’000

Communication systems

(141)

(1)

(140)

204

180

$’000

Signage

(16,394)

4,271

12,190

$’000

Work in progress

72,010

(17,703)

2,546

(103)

(4,353)

(15,879)

89,713

(2,926)

(252)

5,315

87,560

$’000

Total group

ANNUAL REPORT 2013

Net book value

44,930

(996)

Accumulated depreciation at 31 December 2012

Revaluations

1,667

(4,590)

268

Disposals during the year

Recognition of leasehold inducement reversal

(64)

(711)

(1,017) -

(4,083)

6,257

Recognition of accumulated depreciation on assets acquired from subsidiary

Current year depreciation

Accumulated depreciation at 1 January 2012

Accumulated depreciation

45,926

519

452

Cost / valuation at 31 December 2012

Transfers

(9)

Transfer to property held for sale

(269)

207

5,800

Impairment charged during the year

(441)

Revaluations

307

Additions during the year

45,617

$’000

Disposals during the year

Cost / valuation at 1 January 2012

Cost / valuation

Group

Computer hardware

Land & buildings

Property, Plant and Equipment

1,023

(1,512)

(42)

(171)

(1,299)

2,535

177

2,315

$’000

Furniture, fittings & artwork

805

(1,836)

(218)

(1,618)

2,641

237

2,404

$’000

Library collection

327

(645)

(68)

(577)

972

931

$’000

Plant & machinery

(594)

(65)

(581)

685

(52)

724

$’000

Motor vehicles

(390)

(5)

(20)

(365)

427

403

$’000

Office equipment

1,122

(2,267)

(177)

(374)

(1,718)

3,389

453

(8)

398

2,546

$’000

Teaching equipment

8,990

(2,210)

848

(137)

(163)

(1,037)

(1,721)

11,200

5,405

(1,654)

7,380

$’000

Leasehold improvements

459

(699)

(39)

(660)

1,158

448

710

$’000

Communication systems

(140)

180

140

$’000

Signage

12,190

(7,477)

14,499

5,168

$’000

Work in progress

71,681

(15,879)

871

(137)

320

(451)

(3,720)

(12,762)

87,560

(9)

(1,654)

(441)

(329)

15,855

74,138

$’000

Total group

Net book value

58,685

2,546

Accumulated depreciation at 31 December 2013

Revaluations / impairment

Recognition of leasehold inducement reversal

1,139

(5,231)

(639)

(1,550)

Current year depreciation

(4,593)

Disposals during the year

Accumulated depreciation at 1 January 2013 (996)

58,685

Accumulated depreciation

15,615

Transfers

Cost / valuation at 31 December 2013 6,370

(6)

6,265

Transfer from leasehold impairment

(2,926)

Revaluations

Additions during the year

45,926

$’000

Disposals during the year

Cost / valuation at 1 January 2013

Cost / valuation

Polytechnic

Computer hardware

Land & buildings

Property, Plant and Equipment

1,272

(1,717)

(206)

(1,511)

2,989

455

(6)

2,527

$’000

Furniture fittings & artwork

780

(2,040)

(203)

(1,837)

2,820

(1)

179

2,642

$’000

Library collection

312

(734)

(76)

(658)

1,046

(1)

1,024

$’000

Plant & machinery

123

(635)

(51)

(594)

758

(19)

685

$’000

Motor vehicles

(405)

(16)

(389)

436

423

$’000

Office equipment

872

(2,656)

(393)

(2,263)

3,528

(4)

150

3,381

$’000

Teaching equipment

8,354

(3,326)

(103)

(1,087)

(2,210)

11,680

241

(224)

436

11,200

$’000

Leasehold improvements

338

(835)

(136)

(700)

1,173

(1)

1,159

$’000

Communication systems

(141)

(1)

(140)

204

180

$’000

Signage

(16,394)

4,271

12,190

$’000

72,036

(17,720)

2,546

(103)

(4,358)

(15,891)

89,756

(2,926)

(252)

5,315

87,602

$’000

Work in Total progress Polytechnic

ANNUAL REPORT 2013

70 452

Transfers

Revaluations / impairment

Net book value

Accumulated depreciation at 31 December 2012 44,930

(996)

Transfers

Disposals during the year

Recognition of leasehold inducement reversal

1,672

(4,593)

268

(64)

(712)

(1,017) -

(4,085)

6,265

519

(269)

207

5,808

Recognition of accumulated depreciation on assets acquired from subsidiary

Current year depreciation

Accumulated depreciation at 1 January 2012

Accumulated depreciation

45,926

(9)

Transfer to property held for sale

Cost / valuation at 31 December 2012

Impairment charged during the year

(441)

Revaluations

307

Additions during the year

45,617

$’000

Disposals during the year

Cost / valuation at 1 January 2012

Cost / valuation

Polytechnic

Computer hardware

Land & buildings

Property, Plant and Equipment

1,016

(1,511)

(42)

(169)

(1,300)

2,527

177

2,307

$’000

Furniture, fittings & artwork

805

(1,837)

(219)

(1,618)

2,642

238

2,404

$’000

Library collection

366

(658)

(75)

(583)

1,024

983

$’000

Plant & machinery

(594)

(65)

(581)

685

(52)

724

$’000

Motor vehicles

(389)

(5)

(20)

(364)

423

399

$’000

Office equipment

1,118

(2,263)

(177)

(371)

(1,716)

3,381

453

(8)

398

2,538

$’000

Teaching equipment

8,990

(2,210)

848

(137)

(163)

(1,037)

(1,721)

11,200

5,405

(1,654)

7,380

$’000

Leasehold improvements

459

(700)

(40)

(660)

1,159

448

711

$’000

Communication systems

(140)

180

140

$’000

Signage

12,190

(7,477)

14,499

5,168

$’000

71,711

(15,891)

870

(137)

320

(451)

(3,725)

(12,768)

87,602

(9)

(1,654)

(441)

(329)

15,856

74,179

$’000

Work in Total progress Polytechnic

ANNUAL REPORT 2013

Reconciliation of Depreciation Charges Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Depreciation charge per fixed assets note

4,353

3,720

4,358

3,725

Adjustment for reduction in provision for inducement

(194)

(-)

4,159

3,720

4,164

3,725

Depreciation charge per statement of financial performance

Valuation Land Land is valued at fair value using market based evidence based on its highest and best use with reference to comparable land values. Adjustments have been made to the ‘unencumbered’ land value for campus land where there is a designation against the land or the use of the land is restricted because of reserve or endowment status. These adjustments are intended to reflect the negative impact on the value of land where the owner is unable to use the land more intensely. Restrictions on the Polytechnic and group’s ability to sell land would normally not impair the value of the land because the Polytechnic and group has operational use of the land for the foreseeable future and will substantially receive the full benefits of outright ownership. The most recent valuation of land was performed by a registered independent valuer, Bayleys Valuations Limited, and the valuation is effective as at 31 December 2013. Buildings Specialised buildings (e.g. campuses) are valued at fair value using optimised depreciated replacement cost because no reliable data is available for buildings designed for education delivery purposes. Optimised depreciated replacement cost is determined using a number of significant assumptions. Significant assumptions include: • The replacement asset is based on the reproduction cost of the specific assets with adjustments where appropriate for obsolescence due to over design or surplus capacity • The replacement cost is derived from recent construction contracts of similar assets and Property Institute of New Zealand cost information • Estimating the remaining useful life of assets • Straight-line depreciation has been applied in determining the depreciated replacement cost value of the asset The most recent valuation of buildings was performed by a registered independent valuer, Bayleys Valuations Limited, and the valuation is effective as at 31 December 2013. The total fair value of property, including assets held for sale and investment property, valued by Bayleys Valuations Limited at 31 December 2013 totalled $59,006,000.

Restrictions on title Under the Education Act 1989, the Polytechnic and group are required to obtain the consent from the Ministry of Education to dispose of or sell off property where the value of the property exceeds an amount determined by the Minister. There are also various restrictions in the form of historic designations, reserve, and endowment encumbrances attached to land. The Polytechnic and group does not consider it practical to disclose in detail the value of land subject to these restrictions.

ANNUAL REPORT 2013

12. Intangible Assets Group

Polytechnic

Course developWork in ment Goodwill progress Software $’000 $'000 $’000 $’000

Course develop- Work in ment progress Total Software $’000 $’000 $’000 $’000

Total $’000

Balance at 1 January 2013 Cost Accumulated amortisation and impairment Opening carrying amount

2,406

761

460

3,648

2,406

460

2,887

(1,965)

441

761

460

1,683

441

460

922

504

(282)

460

(460)

460

(460)

(289)

393

(460)

(67)

393

(460)

(67)

3,370

761

4,152

3,370

3,391

Year ended 31 December 2013 Additions at cost Accumulated depreciation in additions Disposals Amortisation

Balance at 31 December 2013 Cost Accumulated amortisation and impairment Closing carrying amount

(2,536)

834

761

1,616

834

855

Balance at 1 January 2012 Cost

1,957

760

221

2,938

1,957

221

2,178

(1,640)

317

760

221

1,298

317

221

538

Additions

449

239

710

449

239

709

Accumulated depreciation in additions

(40)

Accumulated amortisation and impairment Opening carrying amount Year ended 31 December 2012

Disposals Amortisation

(285)

124

239

385

124

239

384

2,406

761

460

3,648

2,406

460

2,887

Balance at 31 December 2012 Cost Accumulated amortisation and impairment Closing carrying amount

(1,965)

441

761

460

1,683

441

460

922

There are no restrictions over the title of intangible assets. No intangible assets are pledged as security for liabilities.

Goodwill Goodwill of $761,000 (2012: $761,000) has been allocated to the cash generating unit (CGU) of WNZL. The synergies of the business combination in which the goodwill arose are expected to be realised only by the assets of WNZL. The recoverable amount of the CGU has been determined based on value in use calculations. These calculations use cash flow projections based on financial budgets approved by the Council and cover a five-year period. Cash flows beyond the five year period have been extrapolated using an estimated growth rate. Key assumptions used for the goodwill value in use calculation: • Funding received from the government relating to the level of EFTS funded will remain unchanged for the foreseeable future • Weighted average growth rate 3.01% • Pre-tax discount rate 8% These assumptions have been used for the analysis of the CGU of WNZL. The Polytechnic has determined budgeted gross margin based on past performance and its expectations for the market. The weighted average growth rate used is consistent with the forecasts included in industry reports. The discount rate used is pretax and reflects specific risks relevant to the CGU. The Polytechnic and group believes that a reasonable possible change in any of the key assumptions would not cause the carrying amount of goodwill to exceed the recoverable amount.

13. Investment Properties

Opening balance as at 1 January (fair value) Net gain from fair value adjustment Closing balance as at 31 December

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

280

321

280

321

280

Commerce Crescent property is stated at fair value. Investment properties were valued on 31 December 2013 by Bayleys Valuations Limited, independent registered valuer. Bayleys Valuations Limited is a member of the New Zealand Institute of Valuers (Inc.). The valuations undertaken were based on an open market value, supported by market evidence in which assets could be exchanged between a knowledgeable willing buyer and a knowledgeable willing seller in an arm’s length transaction at the date of the valuation.

14. Property Held for Sale The Lindale campus ($1.57million) was sold on 3 April 2013. During 2012 the Polytechnic identified nine prefabricated buildings ($9,000) as surplus to requirements and intended for sale or disposal.

ANNUAL REPORT 2013

15. Creditors and Other Payables

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Trade payables

1,066

361

1,066

361

GST

1,184

502

1,184

502

Accruals

2,660

6,640

1,544

2,545

Total creditors and other payables

4,910

7,503

3,794

3,408

Creditors and other payables are non-interest bearing and are normally settled on 30-day terms, therefore the carrying value of creditors and other payables approximates their fair value.

16. Special Accounts Special accounts represents funds held by the Polytechnic on behalf of others and funds provided to the Polytechnic by various organisations for specific projects. Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Whitireia International Homestay Trust

Activities account

Other accounts

164

Total special accounts

17. Revenue Received in Advance

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Student fees received in advance

9,837

8,807

9,176

8,430

Sundry revenue in advance

1,805

1,694

11,642

10,501

9,193

8,430

Total revenue received in advance

18. Employee Entitlements Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Accrued pay

581

458

581

458

Annual leave

Current portion 2,514

2,540

2,503

2,540

Sick leave

Long service leave

Retirement gratuities

Total current portion

3,258

3,160

3,247

3,160

120

125

112

125

112

Non-current portion Long service leave Retirement gratuities Total non-current portion Total employee entitlements

180

232

180

232

3,438

3,392

3,427

3,392

Employees are entitled to annual leave pay, long service leave pay and retirement gratuities. Annual leave entitlements expected to be settled within 12 months of the balance sheet date are measured at the current rates of pay and classified as current liabilities. Entitlements related to long service leave and retirement gratuities have been calculated on an actuarial basis. The provision is affected by a number of assumptions including expected length of service, attrition rate, and salary increase.

19. Provisions

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

255

225

255

225

346

225

346

225

104

2,196

2,451

2,196

2,451

884

3,080

2,555

3,080

2,555

3,426

2,780

3,426

2,780

Current portion Lease inducements Contract settlement provision

Non-current portion Lease make-good Lease inducements Contract settlement provision Total provisions

ANNUAL REPORT 2013

Balance at start of year $’000

Provisions made $’000

Provision realised $’000

Balance at end of year $’000

Lease make-good provision

104

(104)

Lease inducement provision

2,676

(225)

2,451

975

2,780

975

(329)

3,426

104

Polytechnic and group 2013

Contract settlement provision Total 2012 Lease make-good provision Lease inducement provision

2,857

(181)

2,676

Total

2,954

(181)

2,780

Lease make-good In respect of its leased property at 107 Cuba Street, the Polytechnic and group was required at the expiry of the lease term to make good any damage caused to the premises from installed fixtures and fittings and to remove any fixtures and fittings installed by the Polytechnic and group. This lease ended during 2013 and the provision was realised. Lease inducements In respect of leased property, the Polytechnic and group entered into a number of agreements to lease properties where an initial inducement was made by the lessor. These inducements included rent free holidays, contributions to fitout and cash incentives. These amounts have been recognised as a provision in the financial statements to be amortised over the lease term (refer note 24). Contract settlement During the year, the Polytechnic and group entered into a contract for the supply of copying services. In terms of this contract, a payment was received from the supplier in order to enable the Polytechnic and group to exit its current supply agreement. This amount has been accounted for as a provision to be amortised over the period of the agreement.

20. Equity

Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Balance at 1 January

45,643

Surplus / (deficit) for the year

(1,699)

45,625

45,580

45,868

(2,057)

(288)

Balance at 31 December

43,944

45,643

43,523

45,580

17,461

17,876

17,461

17,876

General funds

Property revaluation reserves Balance at 1 January Land and buildings net revaluation (loss) / gain

(382)

(415)

(382)

(415)

17,079

17,461

17,079

17,461

Balance at 1 January

Balance at 31 December

Balance at 31 December Restricted reserves

Property revaluation reserves

The property revaluation reserves for land and buildings as at 31 December 2013 is $17,079,000. The format of this disclosure has been amended to only report at asset class level, consistent with the asset classes in note 1. In prior years this reserve was disaggregated into sub-classes.

ANNUAL REPORT 2013

21. Taxation Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Current tax expense

Deferred tax expense / (benefit)

(3)

(1,688)

(2,057)

(288)

(473)

(576)

(81)

515

576

Component of tax expense

Relationship between tax and accounting profit Net surplus / (deficit) before tax Tax at 28% Plus / (less) tax effect of: Non-deductable expenditure Revenue exempt from tax Timing adjustments

(10)

(31)

(13)

Deferred tax adjustments

(3)

Tax expense

Property, plant & equipment

Employee entitlements

Other provisions

Tax losses

Total

Balance at 31 December 2011

Charged to surplus or deficit

Charged to other comprehensive income

Balance at 31 December 2012

Charged to surplus or deficit

Charged to other comprehensive income

Balance at 31 December 2013

Tax losses recognised

Deferred tax asset / (liability)

The group has a recognised deferred tax asset of $2,855 (2012:$Nil) in relation to deductible temporary differences. The group has tax losses of $Nil (2012: $108,955) available to be carried forward and offset against future taxable income.

22. Financial Risk Management Objectives and Policies The group’s principal financial instruments comprise bank deposits, cash and short-term deposits. The group has various other financial instruments such as trade debtors and trade creditors, which arise directly from its operations. Credit risk With the exception of student fees the group trades only with recognised, creditworthy third parties. Receivable balances are monitored on an ongoing basis with the result that the group’s exposure to bad debts is not significant. With respect to the credit risk arising from the other financial assets of the group, which comprise cash and cash equivalents and available-for-sale financial assets, the group’s exposure to credit risk arises from default of the counter party, with a maximum exposure equal to the carrying amount of these instruments. There are no significant concentrations of credit risk within the group. Interest rate risk The tables below illustrate the potential effect on the surplus or deficit and equity (excluding general funds) for reasonably possible market movements, with all other variables held constant, based on financial instrument exposures at balance date. 2013

2012

$’000

-50 bps

+150bps

-50 bps

+150bps

surplus & other equity

(14)

(3)

(2)

(12)

(16)

(15)

(14)

(2)

(10)

(14)

(12)

Group Financial assets Cash and cash equivalents Financial assets in the nature of investments Total sensitivity Polytechnic Financial assets Cash and cash equivalents Financial assets in the nature of investments Total sensitivity

The interest rate sensitivity is based on a reasonable possible movement in interest rates, with all other variables held constant, measured as basis points (bps) movement. For example a decrease in 50 bps is equivalent to a decrease in interest rates of 0.5%.

ANNUAL REPORT 2013

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

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

AA -

3,209

2,920

2,781

2,493

Total cash at bank and term deposits

3,209

2,920

2,781

2,493

Counterparties with credit ratings Cash at bank and term deposits

Debtors and other receivables Existing counterparty without defaults in the past

6,430

8,428

4,011

3,592

Total debtors and other receivables

6,430

8,428

4,011

3,592

Liquidity risk Liquidity risk is the risk that the Polytechnic and group 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 facilities and the ability to close out market positions. The Polytechnic and group aims to maintain flexibility in funding by arranging committed credit lines when required. In December 2012 the Polytechnic and group received Secretary of Education approval for a credit line for up to $4m that was put in place during 2013. In meeting its liquidity requirements, the Polytechnic and group maintains a target level of investments that must mature within specified timeframes. Categories of financial assets and liabilities Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

Cash and cash equivalents (note 6)

2,851

572

2,781

493

Student fees and other receivables (note 7)

6,430

8,428

4,011

3,592

368

2,358

1,356

3,356

Total loans and receivables

9,649

11,358

8,148

7,441

Financial liabilities measured at amortised cost Trade and other payables (note 15)

4,910

7,503

3,794

3,408

Loans and receivables

Financial assets in the nature of investments (note 9)

Loans from related parties (note 25) Total financial liabilities measured at amortised cost

1,322

1,340

4,910

7,503

5,116

4,748

Trade and other payables (note 15) are all due and payable within six months of the balance date. There are no financial instruments held at fair value.

23. Capital Management The Polytechnic and group’s capital is its equity, which comprises accumulated funds and other reserves. Equity is represented by net assets. The Polytechnic and group are 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 borrowing. The Polytechnic and group manages its equity as a by-product of prudently managing revenues, expenses, assets, liabilities, investments, and general financial dealings to ensure the Polytechnic and group effectively achieves its objectives and purpose, whilst remaining a going concern.

24. Commitments and Contingencies Operating lease commitments – Polytechnic and group as lessee The Polytechnic and group has entered into commercial leases on buildings where it is not in the best interest of the Polytechnic and group to purchase these assets. These leases have an average life of between one and eleven years with renewal terms included in the contracts. Renewal terms are included in the commitments where management considers it probable that these will be exercised. There are no restrictions placed upon the leasee by entering into these leases. Future minimum rentals payable under non-cancellable operating leases as at 31 December are as follows: Group Actual 2013 $’000

Due within one year Due after one year and less than five years Due after five years

Polytechnic Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

3,651

3,553

3,651

3,553

11,984

11,732

11,968

11,732

7,360

11,267

7,360

11,267

22,995

26,552

22,979

26,552

ANNUAL REPORT 2013

Capital commitments At 31 December the Polytechnic had the following commitments: Polytechnic Actual 2013 $’000

Actual 2012 $’000

5,752

Wellington campus redevelopment

250

Auckland campus redevelopment

230

480

5,752

Porirua campus redevelopment

Legal claims There are no outstanding legal claims (2012: Nil). Other contingent liabilities The Polytechnic and group has no contingent liabilities (2012: Nil). Contingent assets The Polytechnic and group has no contingent assets (2012: Nil).

25. Related Party Disclosure Terms and conditions of transactions with related parties Providing of ancillary services to and purchases from related parties is made in arm’s length transactions at both normal market prices and normal commercial terms. Outstanding balances at 31 December 2013 and 2012 are unsecured and settlement occurs in cash. Polytechnic Actual 2013 $’000

Actual 2012 $’000

2,017

1,860

Unsecured loans payable to the Polytechnic

186

Unsecured loans payable by the Polytechnic

1,322

Whitireia New Zealand Limited Services provided by the Polytechnic

Transactions between the Polytechnic and its subsidiary include loans and advances to subsidiary. These loans and advances are unsecured, interest free with no fixed terms of repayment. For the year ended 31 December 2013, the group has not raised any provisions for doubtful debts relating to amounts owed by related parties as the payment history has been excellent (2012: $Nil). This assessment is undertaken each financial year through examining the financial position of the related party and the market in which the related party operates in. When assessed as required the group raises such a provision. During 2012 the Polytechnic’s subsidiary acquired the delivery of The New Zealand Film and Television School (NZFTS). The Polytechnic purchased the assets of NZFTS and delivers the training under a contract with WNZL. During 2012 the Polytechnic’s subsidiary acquired the delivery of Computer Power (NZ) Limited. The delivery has been contracted to Computer Power Plus, an unincorporated joint venture owned by the Polytechnic (50%) and WelTec (50%), which was legally formed in December 2012. Crown / Government The government influences the roles of the Polytechnic as well as significant source of revenue, as disclosed in note 2. In conducting its activities, the Polytechnic is required to pay various taxes and levies (such as GST, PAYE and ACC levies) to the Crown and entities related to the Crown. The payment of these taxes and levies is based on the standard terms and conditions that apply to all tax and levy payers. The Polytechnic is exempt from paying income tax and FBT. The Polytechnic purchases goods and services from entities related to the Crown and it also provides services to entities related to the Crown. The purchase and provision of goods and services to government-related entities for the year ended 31 December 2013 are immaterial compared to the Polytechnic's total revenue and expenditure and have all been conducted on an arms’ length basis. These purchases included the purchase of electricity from Meridian, air travel from Air New Zealand, and procurement services from the Ministry of Economic Development. Related party transactions During the year the Polytechnic purchased services from CityLink, an IT firm, in which Council Chair Hon Roger Sowry ONZM is a Director. These services cost $84,199 (2012: $84,205) and were supplied on normal commercial terms. There was an outstanding invoice for $6,965 at year end (2012: $5,970). During the year the Polytechnic purchased services from various organisations that are related to members of Council. These services cost $10,744 (2012: $35,283) and were supplied on normal commercial terms. The amounts paid to individual organisations are immaterial to the Polytechnic's total revenue and expenditure. Key management personnel compensation Group

Salaries and other short-term employment benefits Post employment benefits Total key management personnel compensation

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

613

741

613

741

613

785

613

785

Key management personnel includes the Chief Executive and two executive personnel.

ANNUAL REPORT 2013

26. Councillors Fees

Crown Entities Act 2004 Actual 2013 $

Actual 2012 $

Arthur T

15,975

14,400

Fortuin G

15,975

14,400

32,000

28,800

Sowry R (Chair) Sharman D R

Snively S

Wilkinson R K

15,975

14,400

Barker A

18,000

Sanga K

7,200

14,400

Steel P

McIntosh-Ward N

Renner V

87,125

104,400

From 1 January 2012 the Councils' of Whitireia and WelTec combined. *Fees paid by WelTec

27. Employee Remuneration Group

Polytechnic

Actual 2013 $’000

Actual 2012 $’000

Actual 2013 $’000

Actual 2012 $’000

100,000 - 109,999

110,000 - 119,999

120,000 - 129,999

130,000 - 139,999

140,000 - 149,999

160,000 - 169,999

170,000 - 179,999

210,000 - 219,999

270,000 - 279,999

28. Events After Balance Date Except as already disclosed, there were no other events that have occurred between 31 December 2013 and the date of this report. (2012: None)

29. Childcare Centre Polytechnic Actual 2013 $’000

Actual 2012 $’000

227 49 48

253 47 56

324

356

337 39 376

339 33 372

(52)

(16)

Income Operating grants - Ministry of Education (MOE) Fees - staff, students, public Family assistance - Work and Income New Zealand (WINZ)

Expenses Personnel Other

Net deficit

Note 1

Statistics MOE hours funded

under 2's

6,526

8,523

MOE hours funded

over 2's

10,451

10,158

MOE 20 hours ECE

7,554

10,545

MOE plus 10 hours ECE

2,881

3,714

Comments The Childcare Centre is run as a separate trading entity within the Polytechnic. It operates under one licence (full/all day – Ministry of Education) to provide childcare for up to 30 children primarily for staff and students at the Polytechnic.

Note 1 The accounts presented above are required to be presented separately for Ministry of Education purposes to support the funding provided. There is no reflection of the portion of occupancy costs or depreciation on buildings and equipment used by the Childcare Centre, which are included in the main accounts of the Polytechnic.

ANNUAL REPORT 2013

30. Student Services Levy Domestic students 2013 $â&#x20AC;&#x2122;000

Domestic students 2012 $â&#x20AC;&#x2122;000

231,752

226,074

Health

86,734

108,208

Counselling

54,763

63,367

Hardship

41,891

59,982

Events

30,779

Career counselling

51,483

49,225

265,650

280,782

Levy collected from domestic students Expenses

Total cost

In 2013 the domestic student services levy for the Whitireia group, including the Polytechnic's subsidiary WNZL, was $98 per EFTS (2012: $88.50). For international students the student services levy is included in the tuition fee. No fee is charged to students enrolled in Youth Guarantee and Levels 1-2 programmes in accordance with TEC funding rules. The services covered by the levy are listed above. All of these services met the requirements of the Ministerial Directive on Compulsory Student Levies 2013. Consultation with students on the fee and the services provided was sought via the Whitireia Independent Students' Association (WISA) but no feedback was received. In March 2013 WISA no longer had enough members to continue operating as an incorporated society and the WISA Executive took actions to wind up the Association. Income and expenditure for these services is separately accounted for by Whitireia. Career Counselling expenses weren't included in the 2012 disclosure. All figures above include GST.

31. Explanations of Major Variances Against Budget Statement of Financial Performance

Total revenue for the group was $60.9m against a budget of $64.3m, $3.4m below budget and $1.9m lower than 2012. The shortfall in revenue was mostly in tuition fees with international fees below budget by $1.9m and domestic fees below budget by $1.1m. This was caused by lower student numbers and changes in the mix of provision. The organisation responded by reducing expenditure which was $1.6m below budget at $61.2m against a budget of $62.8m. Expenditure was $0.3m lower than 2012. The overall result was an operating deficit for the group of $0.3m against a budget of $1.5m.

Statement of Responsibility The Council and management are responsible for the preparation of Whitireia Community Polytechnic and groupâ&#x20AC;&#x2122;s financial statements and statement of service performance, and for the judgements made in them. The Council and management of Whitireia Community Polytechnic have the responsibility for establishing and maintaining a system of internal control designed to provide reasonable assurance as to the integrity and reliability of financial reporting. In the Council and managementâ&#x20AC;&#x2122;s opinion, these financial statements and statement of service performance fairly reflect the financial position and operations of Whitireia Community Polytechnic and group for the year ended 31 December 2013. Signed by

Chair of Council Chief Executive 16 April 2014 16 April 2014

ANNUAL REPORT 2013

Independent Auditor’s Report To the readers of Whitireia Community Polytechnic and group’s financial statements and non-financial performance information for the year ended 31 December 2013 The Auditor-General is the auditor of Whitireia Community Polytechnic (the Polytechnic) and group. The Auditor-General has appointed me, David Morrow, using the staff and resources of Ernst & Young, to carry out the audit of the financial statements and non-financial performance information of the Polytechnic and group on her behalf. We have audited: • the financial statements of the Polytechnic and group on pages 46 to 87, that comprise the Statement of Financial Position as at 31 December 2013, the Statement of Financial Performance, 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 non-financial performance information of the Polytechnic and group in the statement of service performance on pages 30 to 40. Opinion In our opinion: • the financial statements of the Polytechnic and group on pages 46 to 87: • comply with generally accepted accounting practice in New Zealand; and • fairly reflect the Polytechnic and group’s: • financial position as at 31 December 2013; and • financial performance and cash flows for the year ended on that date; • the non-financial performance information of the Polytechnic and group on pages 30 to 40 fairly reflects the Polytechnic and group’s service performance achievements measured against the performance targets adopted in the investment plan for the year ended 31 December 2013. Our audit was completed on 16 April 2014. This is the date at which our opinion is expressed. The basis of our opinion is explained below. In addition, we outline the responsibilities of the Council and our responsibilities, and we explain our independence. Basis of opinion We carried out our audit in accordance with the Auditor-General’s Auditing Standards, which incorporate the International Standards on Auditing (New Zealand). Those standards require that we comply with ethical requirements and plan and carry out our audit to obtain reasonable assurance about whether the financial statements and non-financial performance information are free from material misstatement. Material misstatements are differences or omissions of amounts and disclosures that, in our judgement, are likely to influence readers’ overall understanding of the financial statements and non-financial performance information. If we had found material misstatements that were not corrected, we would have referred to them in our opinion. An audit involves carrying out procedures to obtain audit evidence about the amounts and disclosures inthe financial statements and non-financial performance information. The procedures selected depend on our judgement, including our assessment of risks of material misstatement of the financial statements and non-financial performance information,

whether due to fraud or error. In making those risk assessments, we consider internal control relevant to the Polytechnic and group’s preparation of the financial statements and non-financial performance information that fairly reflect the matters to which they relate. We consider internal control in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the Polytechnic and group’s internal control. An audit also involves evaluating: • the appropriateness of accounting policies used and whether they have been consistently applied; • the reasonableness of the significant accounting estimates and judgements made by the Council; • the adequacy of all disclosures in the financial statements and non-financial performance information; and • the overall presentation of the financial statements and non-financial performance information. We did not examine every transaction, nor do we guarantee complete accuracy of the financial statements and nonfinancial performance information. Also we did not evaluate the security and controls over the electronic publication of the financial statements and non-financial performance information. We have obtained all the information and explanations we have required and we believe we have obtained sufficient and appropriate audit evidence to provide a basis for our audit opinion. Responsibilities of the Council The Council is responsible for preparing financial statements that: • comply with generally accepted accounting practice in New Zealand; and • fairly reflect the Polytechnic and group’s financial position, financial performance and cash flows. The Council is also responsible for preparing non-financial performance information that fairly reflects the Polytechnic and group’s service performance achievements measured against the performance targets adopted in the investment plan. The Council is responsible for such internal control as it determines is necessary to enable the preparation of financial statements and non-financial performance information that are free from material misstatement, whether due to fraud or error. The Council is also responsible for the publication of the financial statements and non-financial performance information, whether in printed or electronic form. The Council’s responsibilities arise from the Education Act 1989 and the Crown Entities Act 2004. Responsibilities of the Auditor We are responsible for expressing an independent opinion on the financial statements and non-financial performance information and reporting that opinion to you based on our audit. Our responsibility arises from section 15 of the Public Audit Act 2001 and the Crown Entities Act 2004. Independence When carrying out the audit, we followed the independence requirements of the Auditor-General, which incorporate the independence requirements of the External Reporting Board. Other than the audit, we have no relationship with or interests in the Polytechnic or any of its subsidiaries.

David Morrow Ernst & Young On behalf of the Auditor-General Wellington, New Zealand

ANNUAL REPORT 2013

“It’s amazing how much Whitireia has supported me throughout my study. I am not just another number, they know me as a person.” ROSALIE KING Bachelor of Nursing

Values Manaaki Encouraging co-operation in learning and resource sharing to promote individual confidence and group harmony through a positive and supportive learning environment

Identity Creating a learning environment where all people feel they belong because their uniqueness is valued and promoted

Equity

Vision Whitireia will lead and illuminate its communities through tertiary education

Achieving more equal outcomes by providing significant learning and education success for those who have previously lacked such opportunities

Responsiveness Being flexible, creative and open to change, to better meet individual, industry and community learning needs

Success Being an effective organisation with a clear sense of purpose, striving for excellence and creating an environment where all have the right to succeed

Integrity Maintaining the highest ethical standards and permitting public scrutiny to ensure the maintenance of those standards

Accountability Monitoring and reporting on the maintenance of educational quality standards and on the responsible use of public resources

WHITIREIA NEW ZEALAND ANNUAL REPORT 2013

0800 944 847

leading and illuminating

OUR

www.whitireia.ac.nz

communities through tertiary

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annual report 2013