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Transcript of 2 2002 Highlights - Linking Business to Music Makers Annual Report 200… · 38 PPCA Performers’...
Credits
Content Stephen PeachMarcella McAdamLynne Small
Copy Co-ordination Marcella McAdam
TypingVeronica TookerRosie O'Donoghue
ProofingRosie O'Donoghue
PhotographyKaye HigginsJason McCormack
DesignFreestyle Design
Thanks toSony Music Entertainment Aust., Roadshow Music, Transistor Music, Warner Music, BMG Australia,Universal Music Australia, Standard Records,EMI Music, Festival Mushroom Records
2 2002 Highlights
3 Chairman's Report
4 The Company
5 PPCA Board Members
7 Management Report 2002
10 PPCA Communications
12 PPCA Performers Trust Foundation
13 2002 Most Broadcast Recordings and Artists
14 PPCA Top 100 Most Broadcast Recordings 2002
15 PPCA Top 50 Most Broadcast Recording Artists 2002
16 PPCA Most Broadcast Artists 1999 - 2002
17 PPCA Most Broadcast Recordings 1999 - 2002
18 Appendix A Code of Practice - Australian Music
20 Special Purpose Financial Report
38 PPCA Performers’ Trust Foundation Balance Sheet
39 Appendix B Sample PPCA Licence
40 Appendix C Tariff Categories
Contents
KYLI
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PPCA
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ARTI
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2002 Highlights
2
PPCA revenues, distributions, licences and registered artists continued toincrease in 2001-2002, maintaining our unbroken succession ofimprovements since 1990.
• Income up 17.55% to $9,897,215• Distribution surplus up 23.4% to $7,215,375• Licences up 3.5% to 34,451
THE PPCA PERFORMERS TRUST FOUNDATION APPROVED 15APPLICATIONS FOR FUNDING:
• 12 related to further education and research• 3 for festivals, live music and local artists
DARR
EN H
AYES
| RO
ADSH
OW M
USIC
KEIT
H UR
BAN
| WEA
I am pleased to report on another successful and busy year for the organisation.
The year’s income (1 July to 30 June) stood at the record level of $9.8 million, representing anincrease of 17% over the previous year. The surplus is at another record high - $7.2 milliondollars available to distribute to artists and labels, representing an increase of 23% over the yearending June 2001. This year’s excellent result was assisted by the resolution of the FACTSagreement which accounted for approximately half of the 23% increase, and included a backpayment component.
Public performance licence numbers at the end of the period stood at 34,451, representing anincrease of approximately 3% over the previous year.
Overall, a very encouraging result from a financial perspective, and PPCA’s 13th consecutiveyear of income and surplus growth.
A key highlight for PPCA in 2002 was the relaunching of the website now providing new featuresand an improved and streamlined navigation system, allowing users to easily access relevantinformation on PPCA activities. Areas of direct relevance to registered artists include a news &communications section, material on new policies and legislative issues and the ability to printoff artist and recording registration forms.
This year also saw the introduction of new procedures for artist registration. These wereexecuted as a direct result of the new federal privacy legislation designed to help protectpersonal information and ensure that artist entitlements are correctly reported.
As reported last year, PPCA in association with other Australian collecting societies, developedan industry code of conduct which was successfully implemented this year with PPCA taking allthe necessary steps to ensure compliance with the code.
With regards to international activities, a reciprocal agreement with PPL, PPCA’s sister body inthe UK, covering independent copyright owners for broadcasting and public performance inboth territories was successfully negotiated. Under this arrangement, PPCA will represent UKIndies in Australia for broadcast and public performance rights and PPL will be able to collectand distribute licence fees on behalf of Australian Indies. This is a positive initiative by PPCA forour smaller labels that do not have license arrangements in place with local UK labels or theresources to deal direct with PPL.
PPCA continues its role of raising the awareness of public performance and broadcasting rightsand this includes regular submissions to government to assist in positive law reform. The recentappointment to PPCA of a Manager for Licensing Development will also ensure that new andviable sources of revenue streams from the commercial use of sound recordings are exploredand implemented on behalf of all members.
I would like to take the opportunity to acknowledge the contribution of my fellow Boardmembers during the year and thank them for their support as well as the continued dedicationand hard work of the PPCA secretariat in all their activities.
Peter Bond
Chairman PPCA
November 2002
Chairman’s Report
3Phonographic Performance Company of Australia Ltd. Annual Report 2002
HeadlineSUBHEAD
The Company
DIRECTORS
PETER BOND
ELIZABETH ANN BLAKEY- Appointed 10 September 2001
LOUIS CALLEJA
DENIS ANTHONY HANDLIN
SHAUN JAMES
GREGORY JOHN MACAINSH
MICHAEL MCMARTIN
BELINDA MORRISON
EDWARD ERSKINE ST JOHN- Appointed 3 July 2001
KAREN ANN DON(Alternate for Peter Bond) - Appointed 5 November 2001
MICHAEL WILLIAM GOLDEN(Alternate for Elizabeth Ann Blakey) - Appointed 20 February 2002
GRAHAM DAVID HARRIS(Alternate for Louis Calleja)
DAMIAN PETER RINALDI(Alternate for Denis Anthony Handlin) - Appointed 19 August 2002
MARK NARBOROUGH(Alternate for Shaun James)
DESMOND ARTHUR DUBERY(Alternate for Edward Erskine St John)
JEREMY FABINYI- Resigned 26 July 2001
ADRIAN FITZ-ALAN(Alternate for Denis Anthony Handlin) - Resigned 31 August 2002
TIMOTHY PRESCOTT- Resigned 3 July 2001
AUDITORSDELOITTE TOUCHE TOHMATSU
BANKERSCOMMONWEALTH BANK OF AUSTRALIA
SOLICITORSGILBERT & TOBIN
EXECUTIVE SECRETARIAT
STEPHEN PEACHChief Executive Officer
LYNNE SMALLManager - Finance, Operations & Administration
MAXINE CHISHOLMLicensing Manager
LINDA COURTNEYDistribution Manager
JAMES GRIERSONIT Manager
NICHOLAS LOVELicensing Development Manager
JASON MCLENNANCorporate Counsel
REGISTERED OFFICEPPCA A.C.N. 000 680 704 A.B.N. 43 000 680 704
Level 4, 19 Harris Street, Pyrmont NSW 2009
4
Peter Bond - PPCA Chairman
Peter Bond is the current chairman of PPCA and has 38 years music industryexperience in A&R, marketing, label and regional management in the UK,USA, Australia, Asia and Africa. Peter’s career began at PolyGram in 1964,joining Sony Music (CBS Records) in 1978, then starting his own labelTimbuktu Records in 1990. Peter then joined Universal Music (MCA Records)in 1996. Peter is currently the Chairman of Universal Music Australia andPresident of Universal Music International for Australia, New Zealand andAfrica.
Libby Blakey
Libby Blakey is currently Director of Business Affairs for Festival MushroomRecords and has also held a legal position at Polygram Music.
Louis Calleja
Louis Calleja became a member of the PPCA Board in 1999. Louis is Headof Business Affairs and New Business Development for EMI Music Australia.Louis has qualifications in Business Commerce and Finance, along with anextensive career background within EMI Music Australia in senior executivepositions. With 20 years of experience in the music industry, Louis enjoysworking with teams dedicated to the changing needs of the industry.
Denis Handlin
Denis is the Chairman and Chief Executive Officer of Sony MusicEntertainment Australia Limited, having held various senior positions withinthe company during the past 31 years. Denis is also a former chairman of thePPCA. Denis’ deep involvement in the music industry is also reflected in hiscurrent position as Chairman of the Australian Record Industry Association(ARIA), and his previous experience as Chairman of the ARIA ChartCommittee. Denis has also served on the committees of several industryassociations.
Shaun James
Shaun James became a member of the PPCA Board in May 1999. Shaun isalso the Chairman and CEO of Warner Music Australasia, a division of theWarner Music Group, since 1999. Prior to Shaun’s current position withWarner Music Australia, he held positions in the promotions, sales andmarketing divisions after joining the company in 1991. Shaun’s closeassociation with the Australian music industry began in Melbourne withFestival Records. Shaun holds a Bachelor of Business (Marketing) fromMonash University.
PPCA Board Members
5Phonographic Performance Company of Australia Ltd. Annual Report 2002
PPCA Board Members
Greg Macainsh - Artist Representative
Greg Macainsh has been a recording artist, songwriter and musician for over25 years, forming the seminal Australian group Skyhooks in 1973. Skyhooksdisbanded in 1980 and Greg moved into production, management andsongwriting tuition. A keen bass player, he has toured with a number ofartists, notably John Farnham and Dave Warner. Greg is a strong advocatefor the contemporary music industry, holding positions as a Director andChairperson of the Victorian Rock Foundation from 1989 to 1993 and aWriter Director of APRA from 1997 to 2000. He was elected to the PPCAboard as an Artist Representative in 2001.
Michael McMartin - Manager Representative
Michael McMartin started Trafalgar Records in 1975 and went on to developa stable of artists ranging from Radio Birdman to Gyan and 1927. Michaelformed Melody Management Pty. Ltd. in 1984 and has been manager of theHoodoo Gurus since that time. Other clients presently include BrookeMcClymont, Persian Rugs and producers Charles Fisher (SavageGarden,Hoodoo Gurus etc.) and Tim Whitten (Powderfinger etc.) Michaelwas a foundation member of the Music Managers Forum (MMF Aust) andCo-chairman of MMF for four years. Michael is currently the MMF'sProfessional Development /International Manager and Vice Chairman of theWorld Wide Association of Managers' Forums, the IMMF. Michael is also onthe Board of Support Act Limited - the benevolent society for musicians andworkers in the music industry.
Lindy Morrison - Artist Representative
Lindy Morrison has been a member of the PPCA Board, as a representativeof registered Australian recording artists, since 1993. Lindy toured the worldas a drummer, with Zero, The Go-Betweens and Cleopatra Wong, from 1978until 1992. Since then, Lindy has worked around Australia as the musicaldirector or performer in shows, parades and festivals, and has led drum andmusic workshops with many diverse and varied community groups. Lindy isalso a Director on the Music Council of Australia Board, and she is theNational Coordinator for Support Act Ltd - the benevolent society formusicians and workers in the music industry.
Ed St John
Ed St John became a member of the PPCA Board in July 2001. Ed is theManaging Director of BMG Australia, having previously held a number ofsenior positions within the company since joining in 1998. Prior to joiningBMG, Ed held the position of Director of Marketing, Columbia Records - adivision of Sony Music Australia. Ed’s long association with the musicindustry includes work as a television writer and producer specialising inmusic and entertainment-focused programming, and as a freelance musicwriter and contributor to several key books on Australian music.
6 Phonographic Performance Company of Australia Ltd. Annual Report 2002
FINANCIAL PERFORMANCE
It is a pleasure to once again report record achievements in the areas of revenue, distributablesurplus and licence coverage.
Total income for the 2002 financial year increased by 17%, resulting in overall earnings of $9.8million. Increases in the areas of “Public Performance Fees” (up by $541k) and “CommercialTelevision Fees" (up by $722k) were the main contributors to this positive growth. It should benoted that fees from the commercial television sector covered an eighteen month period, as anadjustment for the previous year was received on conclusion of the agreement.
Unfortunately, the demise of the “Music Country” pay television channel reduced the incomefrom the subscription television sector.
Despite the substantial increases in income, operating expenses were closely contained, andincreased by only 2.4%.
The distributable surplus reached a new high with an increase of 23.4% over the previous year,resulting in an amount of just over $7.2 million for distribution to artists and record labels.
The number of general public performance licences continues to grow, and at June 2002 stoodat 34,451. The ongoing growth in licence coverage and public performance income illustratesthe effectiveness of the licensing department and the contribution of the communicationsprogramme.
The simple graphs on page 9 display PPCA’s achievements in the key areas of revenue,distributable surplus and public performance licence coverage.
COMMUNICATIONS
During the year our programme of advertising and communications has continued, as weendeavour to increase awareness of the value that can be derived from using sound recordingsin business, the concept of copyright ownership, and the benefits PPCA can provide in linkingsound recording users with owners. PPCA’s profile has been enhanced by our participation in anumber of industry events and education based programmes around Australia.
The PPCA website (www.ppca.com.au) is a key element of the communications strategy, andwas relaunched in 2002 after extensive redevelopment. Through its simple navigation system,users can quickly access the increased resources for copyright owners, artists, licensees andthe general public.
DISTRIBUTION
During December 2002, PPCA made its annual distribution to registered artists and record labelsfor the financial year ending June 2002. Almost 750 cheques were issued prior to Christmas todistribute the record surplus to artists and labels.
We continue to work to increase awareness of PPCA throughout the artist community, and urgeall artists, managers and associations to spread the word and encourage all eligible Australianrecording artists to register for the Artist Direct Distribution Scheme.
Similarly, we continue to contact emerging labels to explain the role and function of PPCA andthe benefits of allowing PPCA to assist in their licensing activities.
During the year, two distribution related policy decisions were effected. First, the minimumthreshold for an artist payment was increased to $5 (previously $2). This increase was
Management Report 2002
7
Management Report 2002 continued
implemented to control administrative overheads, due to the costs involved in processingpayments. This is the first increase in a number of years, and still provides a very low thresholdfor participation in direct artist distributions.
As usual, any amounts allocated to registered artists that do not reach this annual threshold willbe directed to the relevant copyright owner / record company, for distribution in accordance withthe particular contractual arrangements for the various recordings.
Secondly, following a review of the artist registration procedures as a result of new federalprivacy legislation, each artist must now register individually (i.e. “group” / “band” registrationsare no longer accepted) and sign their initial registration form. The revamped PPCA website isa good source of information, and explains the registration process. All forms can bedownloaded from the site, and there are some sample documents to demonstrate how theyshould be completed.
Over the next twelve months PPCA will be contacting those registered as “bands” to convertthem to individual registrations. We encourage all artists to ensure that their details are completeand they keep us up to date on a regular basis with details of their new recordings.
The distribution process, a core function of PPCA, is both complex and time consuming. As inprior years, the process was greatly assisted by the free access granted to PPCA by theAustralian Record Industry Association (ARIA) of its extensive catalogue database. Thisdatabase provides invaluable information, and assists in the matching of artist registrations withthe titles contained in the distribution logs.
SUPPORT ACT LIMITED (SAL)
PPCA has continued its support of SAL - a national benevolent fund established to provideassistance to Australian musicians, composers, and associated workers.
PPCA is represented on the Board of SAL, and supports SAL’s aim to provide financial, legal andmedical assistance to those artists / composers and families in need.
In addition to providing ongoing administrative support, PPCA has provided practical assistancein fund raising activities, with events such as the annual Melbourne Cup Lunch drawing theindustry together to generate much needed funds to aid the organisations ongoing charitableactivities.
HUMAN RESOURCES
Mid 2002 saw the appointment of Nick Love in the newly created role of Manager, LicensingDevelopment. The role focuses on key customer relations and identifying new areas ofbusiness, and is a key element of PPCA's strategy to continue to deliver year on year growth inthe areas of revenue and distributable surpluses.
Alex Malik left PPCA in July 2002, in order to undertake doctoral studies in intellectual propertyat Sydney’s University of Technology. Following Alex’s departure, Jason McLennan wasappointed to the position of Corporate Counsel.
8 Phonographic Performance Company of Australia Ltd. Annual Report 2002
THE COMING YEAR
As always, the year ahead is expected to be another challenging one for the organisation andits staff. Negotiations are currently underway with cable subscription telecasters andcommercial radio broadcasters in relation to the appropriate level of licence fees, and we hopeto conclude these agreements within the next few months.
We are also in the process of finalising arrangements with the ABC for a new long termagreement in relation to fees for the use of sound recordings and music video clips in its radioand television services.
We plan to maintain and improve our record for steady public performance licence growth. Ourestablished public relations and communications programme supports this goal and dovetailsneatly with our obligations under the Code of Conduct for Collecting Societies.
PPCA has and will continue to engage in ongoing dialogue with government, to ensure that theparticular needs of artists and sound recording copyright owners are not overlooked as thecommunity embraces new technologies and ways of conducting business.
In relation to broadcast rights, PPCA continues to seek the removal of the artificial limit on radiobroadcast fees contained in the Copyright Act. For many years, the owners of copyright insound recordings have been effectively subsidising the Australian commercial radiobroadcasting industry. Since theintroduction of the Copyright Act(1968) commenced, broadcastershave benefited from the “pricecapping” on the licence fees thatcan be charged for the broadcastof sound recordings.
The limits are significantly lowerthan market rates for suchlicences in other comparablecountries. This is a vital issue forPPCA. It continues to remain highon our list of priorities for thebenefit of our constituents as ithas a significant impact on currentand future income levels.
On this, and all issues, PPCAremains committed to ensuringthat all registered artists andrecord labels obtain fairremuneration for the use of theirsound recordings and music videoclips.
Management Report 2002 continued
GRAPH 1 DISTRIBUTION (Millions)
GRAPH 2 NUMBER OF LICENCES (Thousands)
GRAPH 3 GROSS REVENUE (Millions)
Stephen PeachChief Executive Officer
Lynne SmallManager - Finance,Operations & Administration
9
PPCA Communications
10 Phonographic Performance Company of Australia Ltd. Annual Report 2002
PPCA Communications
PPCA Most Broadcast Australian Country Music Recording Artist for 2001awarded to Gina Jeffreys - pictured with Rod Cameron (UMA), Peter Bond(Chairman, PPCA) and Clive Hodson (ABC Contemporary Music).
Nick Love (Licensing Development Manager, PPCA centre) attended theRestaurant & Catering Awards for Victoria.
Restaurant and Catering NSWs Executive Director, Robert Goldman(centre) pictured with Peter Bond (Chairman, PPCA) and Stephen Peach(CEO, PPCA) shortly after their annual Awards for Excellence.
PPCA were pleased to be a sponsor of both the Fitness ACT Expo and theirinaugural Sports Awards in 2002. Pictured with PPCAs CommunicationsManager, Marcella McAdam (centre) is Dr Dion Klein (Fitness ACTPresident) and Alison Dart (Executive Director, Fitness ACT) at the Expoheld in Canberra.
11
PPCA Performers’ Trust Foundation
Since its inception, PPCA has funded and co-administered with the Musicians’ Union and theMedia Entertainment and Arts Alliance (formerly Actor’s Equity) the PPCA Performers’ TrustFoundation (The Trust). The Trustees during the period 1 July 2001 - 30 June 2002 were PeterBond, Emmanuel Candi (resigned January 2002), Stephen Peach (from February 2002), PatriciaAmphlett and Denis Shelverton.
In exercising their powers pursuant to the provisions of the Trust, the Trustees have the powerto pay or to apply the Trust Fund to or for the benefit of such beneficiaries as the Trustees intheir absolute discretion from time to time determine in respect of one or more of the followingpurposes:
1 performance at concerts at or for charitable institutions such as hospitals or homes for the aged; or,
2 scholarships for the promotion and encouragement of musical and theatrical education; or
3 the promotion and encouragement of the performing arts to the general public;or, in particular,
4 the aid or assistance of any beneficiary who in the opinion of the Trustees is unable to adequately maintain herself/himself by her/his own exertions and other income.
Total funds provided since creating the Trust have been $1,460,806 (up to 30 June 2002).
In the 2001-2002 year, three Trust meetings were held and 19 applications were put to theTrustees. Of these, 15 were approved totaling $74,437. Of the successful applications 12related to further education and research; and 3 to festivals, live music and local artists.
The names of the recipients are as follows:
• Mike Bevan • Willow Neilson Quartet
• Flinders Street School of Music • Sam Riley
• Musicians’ Union of Australia • 15th Annual ARIA Awards
• Claire Stirling • Gary Wain
• Media Entertainment & Arts Alliance • Teresa Beck-Swindale
The Trust Balance Sheet can be found on page 39 of this report.Feedback from many of thegrants recipients has been welcome and useful. Here are some examples:
Thank you for your assistance with the Willow Neilson Quartetstrip to Belgium to attend the Jazz Hoelaart InternationalCompetition in Belgium. Each member of the group has benefitedfrom the experience in many ways. I think we created interest inAustralian jazz amongst all the musicians and organisers that wemet. I attained a contact in each major city in central Europe andthink we succeeded in all of our objectives and more.What I think was most important, outside of the contacts wemade for further touring, recording and arrangement work, wasthe musical interaction between other young musicians of highcalibre from so many countries.
Thank you once again,
Willow Neilson
I am writing on behalf of the Flinders Street School of Music toexpress our sincere thanks for the grant the Trust has providedfor the Festival of Australian Music held in Adelaide in August/September 2000. The Festival was a resounding success, andreceived a very positive response in both the local and nationalmedia as well as providing strong opportunities for students fromthe School.
Once again, please accept our thanks for your generosity.
Diana J HarrisPrincipal LecturerDirector - Festival of Australian Music
12 Phonographic Performance Company of Australia Ltd. Annual Report 2002
As with previous years, PPCA continues to acknowledge the most broadcast recordings andartists in Australia. The extensive play lists used as the basis for PPCA’s distribution surpluspayments determine these results.
The MOST BROADCAST RECORDINGS lists the 100 most broadcast recordings of the year asplayed by radio and television stations across Australia. The MOST BROADCAST ARTIST list ismeasured by collating all titles performed by each of the artists listed in the PPCA radio/TVbroadcast logs taken during the relevant period (i.e. July 2001 to June 2002).
MOST BROADCAST RECORDINGS
The most Broadcast Recording over all for 2002 was Drops of Jupiter by Train taking the #1position; this was followed by Lifehouse with Hanging by a Moment at #2 and then Gabrielle’shit single Out of Reach from the movie soundtrack Bridget Jones’ Diary at #3. Local talent hitthe list with Alex Lloyd’s award winning Amazing reaching #5 making it the most broadcastAustralian recording on radio for the period.
Australian music continued to have a strong presence in the PPCA list for the given period withmany artists achieving multiple entries including Kylie Minogue, Powderfinger, Paul Mac aswell as Alex Lloyd. Credit must be given to the record companies for their dedicated marketingand investment efforts towards these artists and their recordings throughout the year.
Many Australian artists covering diverse genres made their debut onto the PPCA list during 2002and this included Paul Mac, Aneiki, Kasey Chambers, Grinspoon, Shakaya, Selwyn, Bardotand a solo Darren Hayes.
Overall, twenty-one (21) positions in the Top 100 Most Broadcast Recordings for 2002 were byfifteen (15) Australian artists.
MOST BROADCAST ARTISTS
The Top 50 MOST BROADCAST ARTISTS saw an outstanding result for local music withinternational pop sensation Kylie Minogue taking the #1 position. This position was mainlyachieved by having four (4) of her recordings ‘airplayed’ into the Top 100 – Can’t Get You Out ofMy Head, In Your Eyes, Love at First Sight and On a Night Like This - pushing Kylie ahead ofinternational artists U2 at #2 and Madonna at #4 and last year’s #1 on the list, Savage Garden.
In the history of compiling the PPCA broadcast charts, this is the third year running anAustralian act has achieved the top position indicating the popularity of Australian music acrossa wide range of broadcasting station formats. This, combined with her continuing catalogue ofhits, has resulted in Kylie Minogue receiving the PPCA Award as the Most Broadcast AustralianRecording Artist (2002).
Other Australian performers in the Top 50 Most Broadcast Artists list included Paul Mac (10),Powderfinger (13), Alex Lloyd (16), John Farnham (19), Natalie Imbruglia (29), INXS (35)Vanessa Amorosi (36), many still proving the dominance of their music catalogue on radio.PPCA has once again compiled the list of the Most Broadcast Recording and Artists for 1999,2000, 2001 and 2002 on the following pages. Being hard factual data, these results are alwayskeenly observed by artists and record companies, radio stations and music enthusiasts.
2002 Most BroadcastRecordings and Artists
SOPH
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| WAR
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13
1 Drops of Jupiter Train
2 Hanging by a Moment Lifehouse
3 Out of Reach Gabrielle
4 Follow Me Uncle Kracker
5 Amazing Alex Lloyd
6 Pleased to Meet You Aneiki
7 Can’t Get You Out Of My Head Kylie Minogue
8 How you remind me Nickelback
9 Don’t Stop Movin’ S Club 7
10 Starlight (original version) The Superman Lovers
11 Lovin’ each day Ronan Keating
12 In Your Eyes Kylie Minogue
13 Cherry Lips (Go Baby, Go!) Garbage
14 Just The Thing Paul Mac
15 Dancing in the Moonlight Toploader
16 With Arms Wide Open Creed
17 Turn off the Light Nelly Furtado
18 What Took You So Long? Emma Bunton
19 I’m a Believer Smash Mouth
20 Better Man Robbie Williams
21 Sing Travis
22 When it’s Over (album version) Sugar Ray
23 Rapture Iio
24 Can’t Fight the Moonlight Leann Rimes
25 Not Pretty Enough Kasey Chambers
26 Hey Baby (feat. Bounty Killer) No Doubt
27 Walking Away Craig David
28 Drive Incubus
29 Hands Clean Alanis Morisette
30 Superman (It’s Not Easy) Five for Fighting
31 I’m Like a Bird Nelly Furtado
32 Smooth Criminal Alien Ant Farm
33 The Sound of Breaking Up Paul Mac
34 Family Affair Mary J. Blige
35 Elevation U2
36 Thank You Dido
37 It’s Been a While Staind
38 Gotta get Thru This (radio edit) Daniel Bedingfield
39 My Sacrifice (album version) Creed
40 Heavensent Killing Heidi
41 Whole Again Atomic Kitten
42 Ride Wit Me (feat. City Spud) Nelly
43 Androgyny Garbage
44 Don’t Let Me Get Me Pink
45 Let me Blow Ya Mind Eve
46 The Greatest View Silverchair
47 You give me Something Jamiroquai
48 Love at First Sight Kylie Minogue
49 Miss California Dante Thomas
50 Kryptonite 3 Doors Down
51 Wrong Impression Natalie Imbruglia
52 Wherever you will Be The Calling
53 Beautiful Day U2
54 Insatiable Darren Hayes
55 Don’t Mess with the Radio Nivea
56 Crying at the Discotheque Alcazar
(radio edit)
57 You get What You Give New Radicals
58 My Happiness Powderfinger
59 Free Mya
60 Another Chance Roger Sanchez
61 In the End Linkin Park
62 Luv Me, Luv Me Shaggy
(feat. Samantha Cole)
63 I Need Somebody Bardot
64 One Day in Your Life Anastacia
65 Short Skirt / Long Jacket Cake
66 Angel Shaggy
67 If You’re Gone Matchbox 20
68 Chemical Heart Grinspoon
69 Murder on the Dancefloor Sophie Ellis Bextor
70 Smooth Santana
71 Lady (Hear Me Tonight) Modjo
72 Let’s Dance (radio edit) Five
73 Buggin’ Me Selwyn
74 Too Close (radio edit) Blue
75 Do You Love Me? (radio edit) Mademoiselle
76 U Got it Bad Usher
77 Stop Callin’ Me (radio edit) Shakaya
78 Hit ‘em up Style (Oops!) Blu Cantrell
79 I’m outta Love Anastacia
80 Everywhere Michelle Branch
81 25 Miles 2001 - radio mix Three Amigos
82 Ain’t It Funny Jennifer Lopez
83 It’s Raining Men (album version) Geri Halliwell
84 Fallin’ (album version) Alicia Keys
85 Hide U (album version) Kosheen
86 Whenever, Wherever Shakira
87 Shine Vanessa Amorosi
88 The Metre Powderfinger
89 Butterfly Crazy Town
90 Love Foolosophy Jamiroquai
91 Who Do You Love Now? Riva
(radio version)
92 Rockin’ the Suburbs Ben Folds
93 Get the Party Started Pink
94 Hero Enrique Iglesias
95 Escape Enrique Iglesias
96 Green Alex Lloyd
97 Sick Sick Carousel Lifehouse
98 On a Night Like This Kylie Minogue
99 Someone to call my Lover Janet Jackson
100 Dance With Me 112
Chart is measured by collating all titles that appear in the PPCA radio broadcast logs during the period July to June each year.Bold denotes Australian Artist.
14 Phonographic Performance Company of Australia Ltd. Annual Report 2002
PPCA Top 100 Most BroadcastRecordings 2002
1 Kylie Minogue
2 U2
3 Savage Garden
4 Madonna
5 Garbage
6 Elton John
7 Jennifer Lopez
8 Creed
9 The Beatles
10 Paul Mac
11 Ronan Keating
12 Lifehouse
13 Powderfinger
14 Matchbox 20
15 No Doubt
16 Alex Lloyd
17 Nelly Furtado
18 Train
19 John Farnham
20 Robbie Williams
21 Smash Mouth
22 Shaggy
23 Gabrielle
24 Jamiroquai
25 Green Day
26 The Corrs
27 Blink 182
28 Nickelback
29 Natalie Imbruglia
30 Fleetwood Mac
31 Sugar Ray
32 Red Hot Chili Peppers
33 Alanis Morissette
34 Pink
35 INXS
36 Vanessa Amorosi
37 Aneiki
38 The Offspring
39 Killing Heidi
40 Crowded House
41 Anastacia
42 R.E.M
43 Cold Chisel
44 Uncle Kracker
45 Billy Joel
46 Silverchair
47 The Eagles
48 Bryan Adams
49 Craig David
50 Rolling Stones
Chart is measured by collating all titles that appear in the PPCA radio broadcast logs during the period July to June each year.Bold denotes Australian Artist.
NATA
LIE
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UGLI
A | B
MG
KILL
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HEID
I |RO
ADSH
OW M
USIC
POW
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15
PPCA Top 50 Most Broadcast Artists 2002
PPCA Most Broadcast Artists 1999 - 2002
1999
1 Shania Twain
2 The Beatles
3 Madonna
4 Elton John
5 Bachelor Girl
6 Natalie Imbruglia
7 John Farnham
8 Goo Goo Dolls
9 Alanis Morissette
10 Elvis Presley
11 Savage Garden
12 U2
13 Phil Collins
14 Billy Joel
15 Spice Girls
16 Human Nature
17 Mariah Carey
18 John Mellencamp
19 Lighthouse Family
20 Cher
21 All Saints
22 Bryan Adams
23 Jewel
24 Sheryl Crow
25 Neil Diamond
2000
1 Savage Garden
2 The Beatles
3 Madonna
4 Elton John
5 Taxiride
6 Vanessa Amorosi
7 Bryan Adams
8 Shania Twain
9 Killing Heidi
10 U2
11 Backstreet Boys
12 Smash Mouth
13 Bachelor Girl
14 Santana
15 Crowded House
16 The Beach Boys
17 Fleetwood Mac
18 Red Hot Chili Peppers
19 INXS
20 Billy Joel
21 Human Nature
22 The Eagles
23 Rolling Stones
24 John Mellencamp
25 Jennifer Lopez
2001
1 Savage Garden
2 Matchbox 20
3 U2
4 The Corrs
5 Vanessa Amorosi
6 Ronan Keating
7 Kylie Minogue
8 Backstreet Boys
9 Madonna
10 The Beatles
11 John Farnham
12 Elton John
13 PowderFinger
14 Human Nature
15 Bryan Adams
16 Shania Twain
17 Cold Chisel
18 Killing Heidi
19 Bon Jovi
20 Jennifer Lopez
21 INXS
22 Anastacia
23 Bachelor Girl
24 Madison Avenue
25 Billy Joel
2002
1 Kylie Minogue
2 U2
3 Savage Garden
4 Madonna
5 Garbage
6 Elton John
7 Jennifer Lopez
8 Creed
9 The Beatles
10 Paul Mac
11 Ronan Keating
12 Lifehouse
13 Powderfinger
14 Matchbox 20
15 No Doubt
16 Alex Lloyd
17 Nelly Furtado
18 Train
19 John Farnham
20 Robbie Williams
21 Smash Mouth
22 Shaggy
23 Gabrielle
24 Jamiroquai
25 Green Day
Bold denotes Australian Artist.
16 Phonographic Performance Company of Australia Ltd. Annual Report 2002
1999
1 High Lighthouse Family
2 CrushJennifer Paige
3 SlideGoo Goo Dolls
4 Buses And TrainsBachelor Girl
5 BelieveCher
6 One WeekBarenaked Ladies
7 The WayFastball
8 Save TonightEagle Eye Cherry
9 When You're GoneBryan Adams
10 From This MomentOnShania Twain
11 Thank UAlanis Morissette
12 Wishing I Was ThereNatalie Imbruglia
13 Sweetest ThingU2
14 SwayBic Runga
15 LullabyShawn Mullins
16 I Don't Want To MissA ThingAerosmith
17 When the Lights GoOutFive
18 That Don't ImpressMe MuchShania Twain
19 Time Of Your Life(Good Riddance)Green Day
20 HandsJewel
21 Can't Get Enough OfYou BabySmash Mouth
22 The Day You ComePowderfinger
23 This KissFaith Hill
24 Music Sounds BetterWith You (radio edit)Stardust
25 IrisGoo Goo Dolls
2000
1 SmoothSantana
2 Everywhere you goTaxiride
3 She's So HighTal Bachman
4 I TryMacy Gray
5 All StarSmash Mouth
6 I Knew I Loved YouSavage Garden
7 AffirmationSavage Garden
8 When You SayNothing At AllRonan Keating
9 Hey Leonardo(She Likes Me For Me)Blessid Union of Souls
10 WeirKilling Heidi
11 Steal My SunshineLen
12 Have A LookVanessa Amorosi
13 AbsolutelyEverybodyVanessa Amorosi
14 MascaraKilling Heidi
15 Last KissPearl Jam
16 Scar TissueRed Hot ChiliPeppers
17 Get SetTaxiride
18 Baby Did A Bad BadThingChris Isaak
19 Beautiful StrangerMadonna
20 Kiss MeSixpence None TheRicher
21 Burning Down theHouseTom Jones
22 Pure ShoresAll Saints
23 If You Had My LoveJennifer Lopez
24 Permission to ShineBachelor Girl
25 Larger Than LifeBackstreet Boys
2001
1 BreathlessThe Corrs
2 Life is a RollercoasterRonan Keating
3 ShineVanessa Amorosi
4 Sunshine on aRainy Day Christine Anu
5 I’m Outta LoveAnastacia
6 If You’re GoneMatchbox 20
7 Crash & BurnSavage Garden
8 My HappinessPowderfinger
9 BentMatchbox 20
10 Shackles (Praise You)Mary Mary
11 Rome Wasn’t Built inA DayMorcheeba
12 Spinning AroundKylie Minogue
13 It’s My LifeBon Jovi
14 Beautiful DayU2
15 On A Night Like ThisKylie Minogue
16 Teenage DirtbagWheatus
17 Cruisin’Gywneth Paltrow
18 Let’s Get LoudJennifer Lopez
19 Permission To ShineBachelor Girl
20 Chained To YouSavage Garden
21 Groove JetSpiller
22 Don’t You WorryMadasun
23 Gotta Tell YouSamantha Mumba
24 YellowColdplay
25 Can’t Fight TheMoonlight(Theme From “CoyoteUgly”)Leann Rimes
2002
1 Drops of JupiterTrain
2 Hanging by aMomentLifehouse
3 Out of ReachGabrielle
4 Follow MeUncle Cracker
5 AmazingAlex Lloyd
6 Pleased to Meet YouAneiki
7 Can’t get you out ofmy HeadKylie Minogue
8 How you remind meNickelback
9 Don’t Stop Movin’S Club 7
10 Starlight (originalversion)The Superman Lovers
11 Lovin’ Each DayRonan Keating
12 In Your EyesKylie Minogue
13 Cherry Lips (GoBaby, Go!)Garbage
14 Just The ThingPaul Mac
15 Dancing in theMoonlightToploader
16 With Arms Wide OpenCreed
17 Turn off the LightNelly Furtado
18 What Took You SoLong? Emma Bunton
19 I’m a BelieverSmash Mouth
20 Better ManRobbie Williams
21 SingTravis
22 When it’s Over(album version)Sugar Ray
23 RaptureIio
24 Can’t Fight theMoonlightLeann Rimes
25 Not Pretty EnoughKasey Chambers
PPCA Most Broadcast Recordings1999 - 2002
Bold denotes Australian Artist.
ALEX
LLO
YD |
EMI
17
Appendix ACODE OF PRACTICE - AUSTRALIAN MUSIC
The purpose of the Code is to implement the object, set forth in the Broadcasting Services Act1992, of promoting the role of broadcasting services in developing and reflecting a sense ofAustralian identity, character and cultural diversity, by prescribing minimum content levels ofAustralian Music.
Category Format Proportions
A CHR/Mainstream Rock/Album oriented Not less than 25%Alternative
B Mainstream adult contemporary, country, Not less than 20%Classic rock
C Soft adult contemporary, Hits & Memories Not less than 15%Gold, news talk
D Easy listening - oldies, gold Not less than 10%
E Niche formats - jazz, big band Not less than 5%
All formats - other than niche not less than 10%
Metropolitan and Regional Stations
SAVAGE GARDEN | ROADSHOW JOHN FARNHAM | BMG SILVERCHAIR | EMI
HUMAN NATURE | SONY MUSIC BROOKE MCCLYMONT| UNIVERSAL
MAGIC DIRT | WARNER MUSIC
18 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Phonographic Performance Company of Australia Limited
Special PurposeFinancial Report
21 Directors’ Report
24 Independent Audit Report
25 Directors’ Declaration
26 Statement of Financial Performance
27 Statement of Financial Position
28 Statement of Cash Flow
29 Notes to the Financial Statements
19
The Directors of Phonographic Performance Company of Australia Limited, submit herewith theannual financial year ended June 2002. In accordance with the provisions of the CorporationsAct 2001 the Directors report as follows:
The Directors of the company in office during or since the end of the financial year are:
PETER BOND
ELIZABETH ANN BLAKEYAppointed 10 September 2001
LOUIS CALLEJA
DENIS ANTHONY HANDLIN
SHAUN JAMES
GREGORY JOHN MACAINSH
MICHAEL MCMARTIN
BELINDA MORRISON
EDWARD ERSKINE ST JOHNAppointed 3 July 2001
KAREN ANN DON(Alternate for Peter Bond) Appointed 5 November 2001
MICHAEL WILLIAM GOLDEN(Alternate for Elizabeth Ann Blakey) Appointed 20 February 2002
GRAHAM DAVID HARRIS(Alternate for Louis Calleja)
MARK NARBOROUGH(Alternate for Shaun James)
DESMOND ARTHUR DUBERY(Alternate for Edward Erskine St John)
JEREMY FABINYIResigned 26 July 2001
ADRIAN FITZ-ALAN(Alternate for Denis Anthony Handlin)
TIMOTHY PRESCOTTResigned 3 July 2001
Directors’ Report
20 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Directors’ Report
DIRECTORS’ MEETINGS
The following table sets out the number of Directors’ meetings held during the financial year andthe number of meetings attended by each director (while they were directors). During thefinancial year, 5 board meetings were held.
PRINCIPAL ACTIVITY
The principal activity of the company in the course of the financial year was acting for thecopyright owners in the licensing throughout Australia of the broadcast and public performanceof sound recordings and music video clips.
During the year there was no significant change in the nature of this activity.
CHANGES IN STATE OF AFFAIRS
During the financial year there was no significant change in the state of affairs of the companyother than that referred to in the financial statements or notes thereto.
REVIEW OF OPERATIONS
The company distributes the licence fees it collects to the Copyright owners and artists afterdeducting operating expenses. As a result of this, no profit or loss is reported and the Directorsdo not recommend that a dividend will be payable in the current year or was payable in the prioryear.
Elizabeth Ann Blakey 5 4Peter Bond 5 4Louis Calleja 5 2Karen Ann Don (Alternate) 1 1Desmond Arthur Dubery (Alternate) 5 4Jeremy Fabinyi - -Adrian Fitz-Alan (Alternate) 5 4Michael William Golden (Alternate) - -Denis Anthony Handlin 5 -Graham David Harris (Alternate) 3 2Shaun James 5 3Gregory John Macainsh 5 4Michael McMartin 5 4Belinda Morrison 5 5Mark Narborough (Alternate) 2 1Timothy Prescott - -Edward Erskine St John 5 -
DIRECTORS BOARD OF DIRECTORSHeld Attended
21
Directors’ Report
The company's results have again shown a substantial increase in the amount to be distributed to Copyright owners as compared with the previous year. The results of the operations of thecompany during the year were not, in the opinion of the Directors substantially affected by anyitem, transaction or event of a material and unusual nature.
SUBSEQUENT EVENTS
There has not been any matter or circumstance, other than that referred to in the financialstatements or notes thereto, that has arisen since the end of the financial year, that hassignificantly affected, or may significantly affect the operations of the company, the results of thoseoperations, or the state of affairs of the company in financial years.
FUTURE DEVELOPMENTS
Disclosure of information regarding likely developments in the operations of the company in futurefinancial years and the expected results of those operations is likely to result in unreasonableprejudice to the company. Accordingly, this information has not been disclosed in this report.
INDEMNIFICATION OF OFFICERS AND AUDITORS
During or since the financial year the company has not indemnified or made a relevant agreementto indemnify an officer or auditor of the company or of any related body corporate against a liabilityincurred as such an officer or auditor. In addition, the company has not paid, or agreed to pay, apremium in respect of a contract insuring against a liability incurred by an officer or auditor.
Signed in accordance with a resolution of the Directors made pursuant to Section 298(2) of the Corporations Act 2001.
On behalf of the Directors
P. BondDirector
S. JamesDirector
Sydney, 2002
22 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Independent Audit ReportTO THE MEMBERS OF PHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED
Scope
We have audited the attached financial report, being a special purpose financial report, ofPhonographic Performance Company of Australia Limited for the financial year ended 30 June2002 as set out on pages 26 to 38. The company's directors are responsible for the financial reportand have determined that the accounting policies used and described in Note 1 to the financialstatements which form part of the financial report are appropriate to meet the requirements of the
Corporations Act 2001 and are appropriate to meet the needs of the members. We haveconducted an independent audit of the financial report in order to express an opinion on it to themembers of Phonographic Performance Company of Australia Limited. No opinion is expressedas to whether the accounting policies used, and described in Note 1, are appropriate to the needsof the members.
The financial report has been prepared for distribution to members for the purpose of fulfilling thedirectors' financial reporting requirements under the Corporations Act 2001. We disclaim anyassumption of responsibility for any reliance on this report or on the financial report to which itrelates to any person other than the members, or for any purpose other than that for which it wasprepared.
Our audit has been conducted in accordance with Australian Auditing Standards. Our proceduresincluded examination, on a test basis, of evidence supporting the amounts and other disclosuresin the financial report and the evaluation of significant accounting estimates. These procedureshave been undertaken to form an opinion whether, in all material respects, the financial report ispresented fairly in accordance with the accounting policies described in Note 1, so as to presenta view which is consistent with our understanding of the company’s financial position andperformance as represented by the results of its operations and its cash flows. These policies donot require the application of all Accounting Standards and other mandatory professional reportingrequirements in Australia.
The audit opinion expressed in this report has been formed on the above basis.
Audit Opinion
In our opinion, the financial report of Phonographic Performance Company of Australia Limited isin accordance with:
(a) the Corporations Act 2001, including:(i) giving a true and fair view of the company’s financial position as at 30
June 2002 and of its performance for the year ended on that date inaccordance with the accounting policies described in Note 1; and
(ii) complying with Accounting Standards in Australia to the extent describedin Note 1 and the Corporations Regulations 2001; and
(b) other mandatory professional reporting requirements in Australia to the extent described in Note 1.
DELOITTE TOUCHE TOHMATSUJulia BickerstaffPartnerChartered AccountantsSydney, 2002
23
As detailed in Note 1 to the financial statements, the company is not a reporting entity because inthe opinion of the Directors there are unlikely to exist users of the financial report who are unableto command the preparation of reports tailored so as to satisfy specifically all of their informationneeds. Accordingly, this "special purpose financial report" has been prepared to satisfy theDirectors’ reporting requirements under the Corporations Act 2001.
The Directors declare that:
(a) The attached financial statements and notes thereto comply with Accounting Standards;
(b) The attached financial statements and notes thereto give a true and fair view of thefinancial position and performance of the company;
(c) In the Directors’ opinion, the attached financial statements and notes thereto are inaccordance with the Corporations Act 2001; and
(d) In the Directors’ opinion, there are reasonable grounds to believe that the company will beable to pay its debts as and when they become due and payable.
Signed in accordance with a resolution of the directors made pursuant to s.295(5) of theCorporations Act 2001.
On behalf of the Directors’
P. BondDirector
S. JamesDirector
Sydney, 2002
Directors’ DeclarationPHONOGRAPHIC PERFORMANCE COMPANY OF AUSTRALIA LIMITED
24 Phonographic Performance Company of Australia Ltd. Annual Report 2002
$ $
Revenue from ordinary activities 9,897,215 8,419,395
Employee benefits expense (1,330,097) (1,211,738)
Depreciation and amortisation expense (58,545) (73,945)
Borrowing costs (11,067) (7,457)
Other expenses from ordinary activities (1,282,131) (1,280,037)
Distribution to licensors (7,215,375) (5,846,218)
RESULT FROM ORDINARY ACTIVITIES BEFORE INCOME TAX EXPENSE 2 - -
Income tax expense relating to ordinary activities 1(b) - -
Net Result - -
Total Changes in Equity other than those Resulting from Transactions with Members as Members - -
Statement of Financial PerformanceFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002
Note 2002 2001
Notes to the financial statements are included on pages 29 to 38.
25
Statement of Financial PositionAS AT 30 JUNE 2002
$ $
CURRENT ASSETS
Cash assets 898,818 1,105,813
Receivables 6 1,648,764 2,241,552
Other financial assets 7 8,255,000 5,614,619
TOTAL CURRENT ASSETS 10,802,582 8,961,984
NON-CURRENT ASSETS
Plant and equipment 8 96,717 110,524
TOTAL NON-CURRENT ASSETS 96,717 110,524
TOTAL ASSETS 10,899,299 9,072,508
CURRENT LIABILITIES
Payables 9 10,796,062 8,880,045
Interest-bearing liabilities 10 - 10,711
Provisions 11 85,398 117,759
TOTAL CURRENT LIABILITIES 10,881,460 9,008,515
NON-CURRENT LIABILITIES
Interest-bearing liabilities 12 - 56,264
Provisions 13 17,821 7,711
TOTAL NON-CURRENT LIABILITIES 17,821 63,975
TOTAL LIABILITIES 10,899,281 9,072,490
NET ASSETS 18 18
EQUITY
Contributed equity 14 18 18
Retained profits 19 - -
TOTAL EQUITY 18 18
Note 2002 2001
Notes to the financial statements are included on pages 29 to 38.
26 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Statement of Cash FlowFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002
$ $
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from operating activities 10,942,921 8,194,736
Payments for operating activities (2,878,241) (3,305,441)
Interest received 324,935 400,357
Interest paid (11,067) (7,457)
Distribution to licensors (5,846,218) (4,215,189)
Net cash provided by operating activities 17(b) 2,532,330 1,067,006
CASH FLOWS FROM INVESTING ACTIVITIES
Payment for plant and equipment (90,647) (18,419)
Proceeds from sale of plant and equipment 58,678 200
Net cash used in investing activities (31,969) (18,219)
CASH FLOWS FROM FINANCING ACTIVITIES
Repayment of borrowings (66,975) (8,948)
Net cash used in financing activities (66,975) (8,948)
NET INCREASE IN CASH HELD 2,433,386 1,039,839
Cash at beginning of financial year 6,720,432 5,680,593
Cash at the end of the financial year 17(a) 9,153,818 6,720,432
Note 2002 2001
Notes to the financial statements are included on pages 29 to 38.
27
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002
FINANCIAL REPORTING FRAMEWORK
The company is not a reporting entity because in the opinion of the directors there are unlikelyto exist users of the financial report who are unable to command the preparation of reportstailored so as to satisfy specifically all of their information needs. Accordingly, this “specialpurpose financial report” has been prepared to satisfy the Directors’ reporting requirementsunder the Corporations Act 2001.
The financial report has been prepared on the basis of historical cost and except where stated,does not take into account changing money values or current valuations of non-current assets.Cost is based on the fair values of the consideration given in exchange for assets.
The financial report has been prepared in accordance with the Corporations Act 2001, the basisof accounting specified by all applicable Accounting Standards and UIG Consensus Views andthe disclosure requirements of Accounting Standards AASB 1001 “Accounting Policies”, AASB1018 “Statement of Financial Performance”, AASB 1034 “Financial Report Presentation andDisclosures” and AASB 1040 “Statement of Financial Position” and UIG Abstract 35 “Disclosureof Contingent Liabilities”, except the disclosure requirements of AASB 1017 “Related PartyDisclosures” and AASB 1033 “Presentation and Disclosure of Financial Instruments”.
SIGNIFICANT ACCOUNTING POLICIES
Accounting policies are selected and applied in a manner which ensures that the resultingfinancial information satisfies the concepts of relevance and reliability, thereby ensuring that thesubstance of the underlying transactions and other events is reported.
The following significant accounting policies have been adopted in the preparation andpresentation of the financial report:
a) Depreciation
Depreciation is provided on plant and equipment. Depreciation is calculated on astraight-line basis so as to write off the net cost or other revalued amount of each assetover its expected useful life. Leasehold improvements are depreciated over the period ofthe lease or estimated useful life, whichever is shorter, using the straight line method.
The following estimated useful lives are used in the calculation of depreciation.
Office Furniture 10–11 yearsOffice Equipment 9 yearsComputer Equipment 3 yearsMotor Vehicles 5 years
b) Income Tax
The company prepares its income tax returns on the basis that it acts as agent for therecord companies that it represents. As such, it does not derive income on its own account. Rather it is entitled under its constituent document to be reimbursed forexpenditure incurred in the course of its activities. The basis of assessment has beenagreed with the Australian Taxation Office.
The net effect of timing and permanent differences arising from expenditure incurred by the company is passed on to the recipients of the royalties collected.
1. SUMMARY OF ACCOUNTING POLICIES
28 Phonographic Performance Company of Australia Ltd. Annual Report 2002
c) Revenue Recognition
Unearned revenue is brought to account over the terms of the licences issued on thefollowing basis:
i. Public performance fees are normally issued for a period of one year, although shorterperiods are accommodated. In all cases licence fees are payable in advance. Incomeis brought to account on a monthly basis over the life of the contract.
ii. Broadcast licences are issued for various terms - income is brought to account on amonthly basis over the life of the contract.
d) Leased Assets
Leased assets classified as finance leases are recognised as assets. The amount initiallybrought to account is the present value of minimum lease payments.
A finance lease is one which effectively transfers from the lessor to the lesseesubstantially all the risks and benefits incidental to ownership of the leased property.
Finance leased assets are amortised on a straight-line basis over the estimated usefullife of the asset.
Finance lease payments are allocated between interest expense and reduction of leaseliability over the term of the lease. The interest expense is determined by applying theinterest rate implicit in the lease to the outstanding lease liability at the beginning of eachlease payment period.
Operating lease payments are recognised as an expense on a basis which reflects thepattern in which economic benefits from the leased asset are consumed.
e) Recoverable Amount of Non-Current Assets
Non-current assets are written down to recoverable amount where the carrying value ofany non-current asset exceeds recoverable amount. In determining the recoverableamount of non-current assets, the expected net cash flows have not been discounted totheir present value.
f) Employee Entitlements
Provision is made for benefits accruing to employees in respect of wages and salaries,annual leave and long service leave when it is probable that settlement will be requiredand are capable of being measured reliably.
Provisions made in respect of wages and salaries and annual leave expected to besettled within 12 months, are measured at their nominal values.
Provisions made in respect of long service leave which are not expected to be settledwithin 12 months are measured as the present value of the estimated future cashoutflows to be made by the company in respect of services provided by employees upto reporting date.
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
29
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
g) Receivables
Trade receivables and other receivables are recorded at amounts due less any allowancefor doubtful debts.
h) Accounts Payable
Trade payables and other accounts payable are recognised when the company becomesobliged to make future payments resulting from the purchase of goods and services.
i) Investments
Investments are recorded at cost. Interest revenue is recognised on an accruals basis.
j) Acquisition of Assets
Assets acquired are recorded at the cost of acquisition, being the purchaseconsideration determined as at the date of acquisition plus costs incidental to theacquisition.
In the event that settlement of all or part of the cash consideration given in theacquisition of an asset is deferred, the fair value of the purchase consideration isdetermined by discounting the amounts payable in the future to their present value as atthe date of acquisition.
k) Goods and Services Tax
Revenues, expenses and assets are recognised net of the amount of goods and servicestax (GST), except:
i. where the amount of GST incurred is not recoverable from the taxation authority, it isrecognised as part of the cost of acquisition of an asset or as part of an item ofexpense; or
ii. for receivables and payables which are recognised inclusive of GST.
The net amount of GST recoverable from, or payable to, the taxation authority isincluded as part of receivables or payables.
Cash flows are included in the statement of cash flows on a gross basis. The GSTcomponent of cash flows arising from investing and financing activities which isrecoverable from, or payable to, the taxation authority is classified as operating cashflows.
30 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Note 2002 2001
$ $
2. AGENCY REVENUE AND EXPENDITURE
AGENCY REVENUES
Licence fees 9,498,589 7,586,829
Licence fees – prior year claim - 454,462
OTHER AGENCY REVENUES
Interest – other persons 339,948 377,904
Proceeds on disposals of plant and equipment 58,678 200
TOTAL AGENCY REVENUE 9,897,215 8,419,395
Less:
AGENCY EXPENSES
Provision for doubtful debts (note 4) - 7,695
Depreciation of plant and equipment 44,517 52,257
TRANSFER TO PROVISIONS
Long service leave 12,684 12,023
Annual leave 30,296 20,208
FINANCE LEASES
Amortisation of leased assets 14,028 21,688
Finance lease charges 11,067 7,457
AUDITORS’ REMUNERATION
Auditing the financial report 14,000 20,034
Other services 27,579 26,400
OTHER
Operating lease payments 213,936 207,456
Other agency expenses 2,313,733 2,197,959
TOTAL AGENCY EXPENSE 2,681,840 2,573,177
DISTRIBUTION TO LICENSORS 7,215,375 5,846,218
3. SALES OF ASSETS
Sales of assets in the ordinary course of business have been given rise to the following profits:
Plant and equipment 12,769 200
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
31
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
$ $
4. BAD AND DOUBTFUL DEBTS
a) Bad debts written off against provision for doubtful debts – trade receivables 28,480 11,152
b) Amount set aside to provision for doubtful debts – trade receivables - 7,695
5. DIRECTORS’ REMUNERATION
Payments to artist representative directors 3,832 1,552
(Member company representatives are ineligible for fees)
6. CURRENT RECEIVABLES
Trade receivables 1,508,409 770,461
Allowance for doubtful debts (36,327) (64,807)
1,472,082 705,654
Prepaid expenses 1,205 22,087
Other licence receivables 76,604 1,421,635
Other receivables 98,873 92,176
1,648,764 2,241,552
7. OTHER CURRENT FINANCIAL ASSETS
Cash on deposit 8,255,000 5,614,619
Note 2002 2001
32 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
$ $
8. PLANT ANDEQUIPMENT
Office Office Computer MotorFurniture Equipment Equipment Vehicles Total
GROSS CARRYINGAMOUNT
Balance at 30 June 2001 123,026 70,085 212,340 111,336 516,787
Additions 367 2,856 87,424 - 90,647
Disposals - - (104,748) (111,336) (216,084)
Balance at 30 June 2002 123,393 72,941 195,016 - 391,350
ACCUMULATEDDEPRECIATION
Balance at 30 June 2001 (94,587) (65,299) (194,978) (51,399) (406,263)
Disposals - - 104,748 65,427 170,175
Depreciation expense (8,780) (4,821) (30,916) (14,028) (58,545)
Balance at 30 June 2002 (103,367) (70,120) (121,146) - (294,633)
NET BOOK VALUE
As at 30 June 2001 28,439 4,786 17,362 59,937 110,524
As at 30 June 2002 20,026 2,821 73,870 - 96,717
Note 2002 2001
33
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
$ $
8. PLANT AND EQUIPMENT CONTINUED
AGGREGATE DEPRECIATION RECOGNISED AS ANEXPENSE DURING THE YEAR.
Office furniture 8,780 11,397
Office equipment 4,821 7,491
Computer equipment 30,916 33,369
Motor vehicles 14,028 21,688
58,545 73,945
9. CURRENT PAYABLES
Trade payables 500,349 515,941
Goods and Services Tax (GST) payable 268,308 182,066
Licence fees received in advance 2,812,030 2,335,820
Amounts payable to licensors 7,215,375 5,846,218
10,796,062 8,880,045
10. CURRENT INTEREST-BEARING LIABILITIES
Secured: Finance lease liability (note 15) - 10,711
11. CURRENT PROVISIONS
Employee entitlements (note 18) 85,398 117,759
12. NON-CURRENT INTEREST-BEARING LIABILITIES
Finance lease liabilities (note 15) - 56,264
13. NON-CURRENT PROVISIONS
Employee entitlements (note 18) 17,821 7,711
14. CONTRIBUTED EQUITY
18 fully paid ordinary shares 18 18
Fully paid ordinary shares carry one vote per share.
Note 2002 2001
34 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
$ $
15. LEASES
FINANCE LEASE COMMITMENTS
Not later than one year - 16,392
Later than one year and not later than five years - 60,603
Minimum finance lease payments - 76,995
Less: Future finance charges - (10,020)
Finance lease liability - 66,975
Included in financial statements as:
Current Interest-bearing liabilities (note 10) - 10,711
Non-current Interest-bearing liabilities (note 12) - 56,264
- 66,975
NON-CANCELLABLE OPERATION LEASES
Phonographic Performance Company of Australia Limitedhas an operating lease for its office premises. The leaseexpires 30 April 2003 with an option to renew. Leasecommitments are as follows:
No longer than 1 year 185,468 215,239
Longer than 1 year and not longer than 5 years - 184,770
185,468 400,009
16. FINANCIAL REPORTING BY SEGMENT
The company operates in one industry being the derivationof revenue from licensing the broadcast and publicperformance of sound recordings and music video clipswholly within Australia.
Note 2002 2001
35
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
$ $
17. NOTES TO THE STATEMENT OF CASH FLOWS
a) Reconciliation of Cash
For the purposes of the statement of cash flows, cashincludes cash on hand and in banks and investments inmoney market instruments, net of outstanding bankoverdrafts. Cash at the end of the financial year as shownin the statement of cash flows is reconciled to the relateditems in the statement of financial position as follows:
Cash assets 898,818 1,105,813
Cash on term deposit 8,255,000 5,614,619
9,153,818 6,720,432
b) Reconciliation of result from ordinary activities to net cash flows from operating activities
PROFIT FROM ORDINARY ACTIVITIES - -
Profit on sale of non-current assets (12,769) (200)
Depreciation and amortisation of non-current assets 58,545 73,945
Changes in net assets and liabilities:
(Increase)/decrease in assets:
Current receivables 592,788 (977,272)
Increase/(decrease) in liabilities
Current payables 1,916,017 368,139
Current provisions (32,361) 1,661,204
Non-current provisions 10 ,110 (58,810)
Net cash provided by operating activities 2,532,330 1,067,006
18. EMPLOYEE ENTITLEMENTS
The aggregate employee entitlement liability recognised and included in the financial statements is as follows:
Provision for Employee Entitlements
Current (note 11) 85,398 117,759
Non-current (note 13) 17,821 7,711
103,219 125,470
No. No.
Number of employees at end of financial year 26 27
Note 2002 2001
36 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Notes to the Financial StatementsFOR THE FINANCIAL YEAR ENDED 30 JUNE 2002 continued
$ $
19. RETAINED PROFITS
Balance at beginning of financial year - -
Net result - -
Balance at end of financial year - -
20. ADDITIONAL COMPANY INFORMATION
Phonographic Performance Company of Australia Limited isa limited company, incorporated and operating in Australia.
Principal Registered Office and Place of Business
Level 9, 263 Clarence Street
Sydney NSW 2000
Note 2002 2001
37
PPCA Performers’ Trust FoundationBALANCE SHEET AS AT 30 JUNE 2002
$ $
FUNDS RETAINED IN THE TRUST 328,142 328,755
Represented by:
CURRENT ASSETS
Cash assets 61,467 77,223
Accrued income 4,813 4,562
Deposits – at call 77,607 12,072
Term deposits 400,000 450,119
GST – tax input receivable - 470
TOTAL CURRENT ASSETS 543,887 544,446
TOTAL ASSETS 543,887 544,446
Less:
CURRENT LIABILITIES
Payables and accrued charges 2,350 2,400
Grants allocated and unexpended at year end held by trustees for beneficiaries of:
Professional Musicians’ Union of Australia 171,973 146,086
Media Entertainment & Arts Alliance 41,422 67,205
TOTAL CURRENT LIABILITIES 215,745 215,691
TOTAL LIABILITIES 215,745 215,691
NET ASSETS 328,142 328,755
Note 2002 2001
38 Phonographic Performance Company of Australia Ltd. Annual Report 2002
Appendix BSAMPLE PPCA LICENCE
39
Appendix CTARIFF CATEGORIES
A General Licences - open air events; school, dance academy or church concerts; motivational
speakers.(Single event licences are available).
B Arts, film, music events and similar festivals
C Cinemas and theatres
D Dance studios, dance instructors, line dance instructors
DD Live performance groups, dance companies, performance promoters
E Nightclubs, discotheques, discotheque promoters, foreground music in bars
F Mobile discotheque operators/DJ’s
FW Mobile video discotheque operators
H Halls
HM Music on hold
I Factories, industrial premises and offices.
J Jukeboxes
JO Jukebox operators
JW Video jukebox operators
K Amusement centres, pool rooms, squash courts, swimming pools, ten pin
bowling centres
M Commercial or professional premises - including art galleries, bars, clubs,
elevators, foyers, function rooms, funeral parlours, hairdressers, health/medical
offices (eg doctors, dentists, chiropractors, massage therapists, osteopaths,
physiotherapists), hotels, libraries, lounges, massage parlours, motels,
museums, reception areas, retail stores, taverns, zoos, and/or similar establishments
MW Electrical and hi-fi stores
N Shopping centres, plazas, concourses
P Public vehicles (eg aircraft, buses, charter boats, coaches, ferries, hire cars, light
rail, monorail, ships, taxis, trains, trams)
R Restaurants, cafes, coffee lounges, road houses
S Sports arenas, race tracks, showgrounds, outdoor amusement parks
SS Community service recreational areas (beaches, parks)
U Skating rinks
V Fitness centres, gymnasiums, health clubs
W Music video clips
W-E Music video clips in nightclubs, fixed discotheques and discotheque operators
X Concert venues
Y Conference rooms
Licence fees are calculated differently in each category (eg, fees may be flat fees per annum, fees perperson or per machine, or fees determined by size of venue depending on category) - contact PPCAfor full details. It is quite possible, depending on your needs, that you may have a licence with anynumber of Tariffs eg a hotel may have a number of bar areas (Tariff M), restaurants (Tariff R), nightclubs(Tariff E), gymnasium (Tariff V), and video jukebox (Tariff W).
DISC
OM
ONTE
GO |
WAR
NER
MUS
IC
LEE
KERN
AGHA
N | A
BC C
ONTE
MPO
RARY
MUS
IC
40