Annual Report 2014€¦ · 6 Annual report Inglewood & Districts Community Enterprises Limited...
Transcript of Annual Report 2014€¦ · 6 Annual report Inglewood & Districts Community Enterprises Limited...
Annual Report2014
Inglewood & Districts Community Bank®Branch
ABN 87 123 959 375
Inglewood & Districts Community Enterprises Limited
Annual report Inglewood & Districts Community Enterprises Limited 1
Contents
Chairman’s report 2
Manager’s report 3
Directors’ report 4
Auditor’s independence declaration 11
Financial statements 12
Notes to the financial statements 16
Directors’ declaration 36
Independent audit report 37
NSX report 39
Annual report Inglewood & Districts Community Enterprises Limited2
For year ending 30 June 2014
On behalf of the Board I am pleased to report that we continue to deliver on the commitments that we originally
made to our shareholders and the broader community:
• Weprovideafirstclassbankingservice.
• Wegenerateprofitsthatarereturnedtothecommunity.
• Wehavealsobeenabletoregularlyreturndividendstoourloyalshareholders.
ThemajorchallengeforourBoardistoalwaysmaintainourfocusonthesecommitments.
Ourachievementstodateareacauseofcelebrationandpride.Wearea$100millionbusinessinasmall
communityandwehavenowreturnedintheorderof$800,000tothatcommunityintheformofsponsorshipsand
grants.Wewillcontinuetobuildonthoseachievements.Wewillcontinuetorepaythefaithofourcustomersand
shareholders.
Oursuccesshasnotcomeeasilyandwouldnothavebeenpossiblewithoutthehardworkanddedicationofour
staff,thecontinuedsupportshownbyourshareholdersandthesupportofourcustomers.OnbehalfoftheBoard
Ithankyouall.
TheBoardisalwayslookingfornewideas,newwaysinwhichbankingprofitscanbeusedtobuildabetter
community.Weneednewpeoplewithdifferentperspectivesanddifferentwaysofthinkingtojoinus.Weneedto
establishacontinuouscycleofregenerationandreinvigorationwithintheBoard.Pleaseconsiderbeingpartofthat
process.
Max Higgs
Chairman
Chairman’s report
Annual report Inglewood & Districts Community Enterprises Limited 3
For year ending 30 June 2014
AseachnewfinancialyearbeginsIwonderwhatchallengeswewillfaceastheyearunfolds.Wehaveagain
overcomethedifficultiesofchallengingfinancialmarketsandcompetitiveinterestratesthroughour‘Pointof
Difference’andcontinuedcommunitysupport.Sevenyearsonandourbusinesscontinuestogrowandgenerate
profitsenablingustocontributefundsbackintoourlocaldistricts.Itissorewardingtoseethemanyprojects
givennewlifeandtobepartofassistingourcommunitiestobecomemoresustainableforthefuture.
Asat30June2014ourbranchfigureswere:-
• Depositfootings $44,800million
• Lendingfootings $39,500million
• Otherbusiness $22,200million
• Totalbusiness $106,500million.
The2013/14financialyearsawtheoverallbusinesssizegrowfrom$104.7millionto$106.5million,agrowthof
$1.8millionfortheyear.Customernumbersareat2,245andoverthecountertransactionsare2,138permonth.
Wecontinuetobeleadersin‘communitydriven’initiatives,primarilythroughourDriversEducationProgram,
ScholarshipAwards,GrantsandSponsorshipswithcontributionstoourlocalcommunitiessinceopeningin
2007being$765,000.Inaddition,dividendshavealsobeenreturnedtoourShareholdersonaregularbasis
sinceopening.
Our branch needs your maximum support to enable us to increase the amount of funds we can contribute into the
communitysoifyouarenotalreadybankingwithuspleaseconsideritsothatyourbankingcanmakeadifference
toyourcommunity.
Duringthepast12monthstherehasbeenastaffchangewithinthebranch.JanStarrtransferredtoBendigo
CentralBranchinSeptember2013andNatalieRodwellcameontoourteamasaPart-timeCustomerService
OfficerinOctober2013.WewishJanallthebestinhernewroleandwelcomeNattoourbranch.WehopeNathas
a long and successful career with Inglewood & Districts Community Bank® Branch.
FinallyIwouldliketothankthededicatedstaffattheInglewood&DistrictsCommunity Bank® Branch,the
WedderburnAgencystaff,ourBoardofDirectors,RegionalOfficestaff,shareholdersandcustomers.Noneofthis
wouldbepossiblewithoutyourvaluedsupportanditisbecauseofyoursupportwehaveasuccessfulbranch,
successfulcustomersandasuccessfulcommunity.
Sincerely,
Jill Burdett
Branch Manager
Manager’s report
Annual report Inglewood & Districts Community Enterprises Limited4
Directors’ reportForthefinancialyearended30June2014
Yourdirectorssubmitthefinancialstatementsofthecompanyforthefinancialyearended30June2014.
Directors
Thenamesanddetailsofthecompany’sdirectorswhoheldofficeduringorsincetheendofthefinancialyear:
Maxwell Charles Higgs
Chairman
GeneralMedicalPractitioner
GraduatedMBBSUniversityofMelbournein1981.HasworkedasaGeneralPractitionerintheareaforthe
past29years.Maxserved3yearsasCouncillorfortheInglewoodRidingShireofLoddon,previouslyamember
ofInglewood&DistrictHealthServicesBoardofManagement.
Chairman,Audit
Interestinshares:3,001
Kenneth John Canfield
Treasurer
PrimaryProducer
HeldexecutivepositionswiththeInglewoodGolfandBowlsClubs,MemberofSalisburyWestLandcareGroup
andmemberofSalisbury/PowlettFireBrigade.
Treasurer,Governance
Interestsinshares:1,001
Kim Hanlon
Secretary
Centre Manager
KimiscurrentlyemployedastheManageroftheInglewoodCommunityNeighbourhoodHouse.Previouslyan
EmploymentConsultantfortheSalvationArmyEmploymentPlus,ReceptionistatGirtonGrammarSchooland
InglewoodDistrictHealthServiceandOfficeManagerforanearthmovingcontractor.Herqualificationsinclude
aDiplomaofBusinessandCertificateIVinWorkplaceAssessmentandTraining.KimisaMemberofInglewood
sportinggroupsandisthePresidentoftheKorongNewsletter.In2010shegraduatedfromtheLoddonMurray
CommunityLeadershipProgram.
Interestinshares:Nil
Dale Thomas Jackson
Director
TechnicalOfficerEngineer
TechnicalDesignOfficerattheShireofLoddoninfrastructureDepartment.DiplomaofEngineering,Vice
PresidentoftheWedderburnBowlsClub,VicePresidentofWedderburnKorongvaleRSLInc,DonaldsonPark
CommitteeMemberandWedderburnCommunity Bank® SteeringCommitteeMember.
Marketing,InglewoodHallHubProject
Interestsinshares:501
Annual report Inglewood & Districts Community Enterprises Limited 5
Directors’ report (continued)
Directors (continued)
Andrew Richard Smith
Director
Operations Manager
AndrewistheOperationsManagerforalocalfertilizercompany.HeservesontheBoardofStMary’sPrimary
SchoolandisamemberoftheInglewoodCountryFireAuthoritywhereheholdsthepositionofLeiutenant.He
isalsotheCFALoddonSouthGroupDeputyGroupOfficer.
Marketing
Interestsinshares:1,001
Simon Patrick Tuohey
Director
PrimaryProducer
CurrentSecretaryforSerpentineCFA,memberofSerpentinePlanCommittee,BearsLagoonSerpentine
FootballClubCommittee(previouslypresident)andmemberofSerpentineTennisClub.
Interestsinshares:2,001
Jill McFarlane
Director
Retired
Secretaryoffamilyfarmingbusiness.ChairofManagementBoardofHeritageIndustriesMtGambier,Audit
CommitteeofNCCMABendigoandWedderburnConservationManagementNetwork.MemberofHeritage
Industriesfor21years(sinceestablishment).AlsopreviouslyBoardmemberforNorthCentralCatchment
ManagementAuthority.PreviouslyCouncillorforVictorianEnvironmentalAssessmentCouncil.Currentlymember
ofvariouscommunitygroupsandassociations.Previousemploymenthistoryincludes26yearsasmedical
socialworkerinregionalhospitals.
Interestsinshares:7,500
Colleen Mary Condliffe
Director
PrimaryProducer/LoddonShireCouncillor
ColleenhasaBio-ChemistryDegreeandisapartofarangeofcommunityorganisations.Sheisaboard
memberoftheWomenHealthLoddonMallee,theRuralFinancialCounsellingServiceandtheInglewood
CommunityNeighbourhoodHouse.SheisalsoaLoddonShireCouncillorandamemberoftheNewbridgeCWA
andtheSalisburyWestLandcareGroup.
Interest in shares: 1
David Allan Edwards
Director
Manger & Business Owner
AnexperienceOperationsManagerformorethan10years,currentlytheowneroftheBridgewaterFarmware.
HasbeeninvolvedincommunitygroupsincludingBridgewaterPrimarySchoolfor5years.Davidhasa
tertiaryqualificationinengineering,ProjectandOperationalManagement.HeldvariouscorporateOperations
Managementrolesoverthepast15years.
Interests in shares: 1
Annual report Inglewood & Districts Community Enterprises Limited6
Directors’ report (continued)
Directors (continued)
Linda Joy Younghusband
Director
FarmingAssistant/MedicalReceptionist
Previouslyco-owneroffamilybusiness,memberoftheInglewoodPrimarySchoolParentsAssociation
participatingastheSecretaryandTreasurer.CurrentlyamemberoftheWedderburnCollegeParents
Association,holdthepositionofInglewoodSchoolCouncillorandactivelyinvolvedinWedderburnsporting
groups.
Interestsinshares:500
Stewart Dean Luckman
Director
Banker
PreviouslyemployedasaFlourMilleratLauckeFlourMill.CurrentlyemployedasaBankerattheInglewood&
Districts Community Bank® Branch.MemberoftheInglewoodLionsClub,committeememberoftheInglewood
ChristmasCarolsevent,memberoftheAustraliaDaycelebrations,memberoftheInglewoodPrimarySchool
ParentsAssociation,memberofInglewood&BridgewaterMen’sShedaswellasbeingasocialmemberofthe
InglewoodandBridgewaterRSLandaCentralUmpirefortheLoddonValleyFootballLeague.
Interestinshares:Nil
George Arthur Wyatt
Secretary(Resigned22November2013)
Retired
Extensiveclericalworkinfinancialservicesindustry,managedthetradingenginefortheBendigoStock
Exchange.GeorgehasbeeninvolvedwiththeNewbridgeFloodRecoveryandalsowithlocalsportingclubs.
Secretary,HRandGovernance.
Interestsinshares:4,001
Directorswereinofficeforthisentireyearunlessotherwisestated.
Nodirectorshavematerialinterestsincontractsorproposedcontractswiththecompany.
Company Secretary
ThecompanysecretaryisKimHanlon.Kimwasappointedtothepositionofsecretaryon26November2013.
KimiscurrentlyemployedastheManageroftheInglewoodNeighbourhoodHouse.Previouslyanemployment
ConsultantfortheSalvationArmy,ReceptionistatGirtonGrammarSchoolandInglewoodDistrictHealthService
andOfficeManagerforanearthmovingcontractor.HerqualificationsincludeaDiplomaofBusinessandCertificate
IVinWorkplaceAssessmentandTraining.KimisaMemberofInglewoodsportinggroupsandKorongNewsletter.
In2010shegraduatedfromtheLoddonMurrayCommunityLeadershipProgram.
Principal Activities
TheprincipalactivitiesofthecompanyduringthefinancialyearwerefacilitatingCommunity Bank® services under
managementrightstooperateafranchisedbranchofBendigoandAdelaideBankLimited.
Therehavebeennosignificantchangesinthenatureoftheseactivitiesduringtheyear.
Annual report Inglewood & Districts Community Enterprises Limited 7
Directors’ report (continued)
Operating results
Operationshavecontinuedtoperforminlinewithexpectations.Theprofitofthecompanyforthefinancialyear
after provision for income tax was:
Year ended 30 June 2014$
Year ended 30 June 2013$
13,274 37,989
Operating and Financial Review
Thecompanycontinuestogrowandgenerateprofits–thedriversbeingourhardworkinganddedicatedstaff,our
loyalshareholdersandasupportiveandengagedwidercommunity.
Ourbankhasreturnedaprofiteverymonthsinceourfirstfourmonthsofoperation.Wehavenowreturnedin
excessof$600,000toourlocalcommunityinadditiontoreturningdividendsandfrankingcreditstoshareholders.
Wecurrentlyhaveinexcessofanother$100,000setasideforfurthercommunitygrants.Theboardremains
focusedonbothcontinuingtofinanciallyassistourcommunityandrewardourshareholders.
Webelievethatthewidercommunityisincreasinglyawareoftherewardstobegainedbyplacingtheirbusiness
withourbank.Theboardandourstaffwillcontinuetoreinforcethismessage.
Remuneration report
NodirectorreceivesremunerationforservicesasaCompanyDirectororCommitteeMember.
There are no employees who are directly accountable and have responsibility for the strategic direction and
operationalmanagementoftheentity.
TherearethereforenospecifiedExecutiveswhoseremunerationrequiresdisclosure.
Directors’ shareholdings
Balance at start of the year
Changes during the
year
Balance at end of the year
MaxwellCharlesHiggs 3,001 - 3,001
KennethJohnCanfield 1,001 - 1,001
KimHanlon - - -
DaleThomasJackson 1,001 500 501
AndrewRichardSmith 1,002 1 1,001
SimonPatrickTuohey 2,001 - 2,001
Jill McFarlane 1,500 6,000 7,500
Colleen Condliffe 501 500 1
DavidEdwards - 500 500
LindaYounghusband 500 500
StewartDeanLuckman - - -
GeorgeArthurWyatt(Resigned22November2013) 3,501 500 4,001
Annual report Inglewood & Districts Community Enterprises Limited8
Directors’ report (continued)
Dividends
Year ended 30 June 2014
Cents $
-Dividendspaidintheyear 6 30,325
Significant changes in the state of affairs
Intheopinionofthedirectorstherewerenosignificantchangesinthestateofaffairsofthecompanythat
occurredduringthefinancialyearunderreviewnototherwisedisclosedinthisreportorthefinancialstatements.
Events since the end of the financial year
Therearenomattersorcircumstancesthathavearisensincetheendofthefinancialyearthathavesignificantly
affectedormaysignificantlyaffecttheoperationsofthecompanytheresultsofthoseoperationsorthestateof
affairsofthecompany,infutureyears.
Likely developments
Thecompanywillcontinueitspolicyoffacilitatingbankingservicestothecommunity.
Environmental regulation
Thecompanyisnotsubjecttoanysignificantenvironmentalregulation.
Indemnification and insurance of directors and officers
Thecompanyhasindemnifiedalldirectorsandthemanagerinrespectofliabilitiestootherpersons(otherthan
the company or related body corporate) that may arise from their position as directors or manager of the company
exceptwheretheliabilityarisesoutofconductinvolvingthelackofgoodfaith.
Disclosureofthenatureoftheliabilityandtheamountofthepremiumisprohibitedbytheconfidentialityclauseof
thecontractofinsurance.Thecompanyhasnotprovidedanyinsuranceforanauditorofthecompanyorarelated
bodycorporate.
Directors’ meetings
The number of directors’ meetings attended by each of the directors of the company during the year were:
Board Meetings Attended
Committee Meetings Attended
Audit MarketingHuman
Resources
Eligible Attended Eligible Attended Eligible Attended Eligible Attended
MaxwellCharlesHiggs 12 12 1 1 - - - -
KennethJohnCanfield 12 11 1 1 - - - -
KimHanlon 12 10 1 - - - - -
DaleThomasJackson 12 9 - - - - - -
AndrewRichardSmith 12 8 - - 12 8 - -
SimonPatrickTuohey 12 11 - - - - - -
Annual report Inglewood & Districts Community Enterprises Limited 9
Directors’ report (continued)
Board Meetings Attended
Committee Meetings Attended
Audit MarketingHuman
Resources
Eligible Attended Eligible Attended Eligible Attended Eligible Attended
Jill McFarlane 12 9 - - 12 9 - -
Colleen Condliffe 12 12 - - - - 4 4
DavidEdwards 12 11 - - - - 4 4
LindaYounghusband 12 12 - - 12 12 - -
StewartDeanLuckman 12 12 - - 12 12 - -
GeorgeArthurWyatt(Resigned22
November2013)5 5 - - - - - -
Proceedings on behalf of the company
NopersonhasappliedtotheCourtundersection237oftheCorporationsAct2001forleavetobringproceedings
onbehalfofthecompany,ortointerveneinanyproceedingstowhichthecompanyisaparty,forthepurposeof
takingresponsibilityonbehalfofthecompanyforallorpartofthoseproceedings.
NoproceedingshavebeenbroughtorintervenedinonbehalfofthecompanywithleaveoftheCourtundersection
237oftheCorporationsAct2001.
Non audit services
The company may decide to employ the auditor on assignments additional to their statutory duties where the
auditor’sexpertiseandexperiencewiththecompanyareimportant.Detailsoftheamountspaidorpayabletothe
auditor(AndrewFrewinStewart)forauditandnonauditservicesprovidedduringtheyeararesetoutinthenotes
totheaccounts.
Theboardofdirectorshasconsideredtheposition,inaccordancewiththeadvicereceivedfromtheboardandis
satisfiedthattheprovisionofthenon-auditservicesiscompatiblewiththegeneralstandardofindependencefor
auditorsimposedbytheCorporationsAct2001.
Thedirectorsaresatisfiedthattheprovisionofnon-auditservicesbytheauditor,assetoutinthenotesdidnot
compromisetheauditorindependencerequirementsoftheCorporationsAct2001forthefollowingreasons:
• allnon-auditserviceshavebeenreviewedbytheboardtoensuretheydonotimpactontheimpartialityand
objectivity of the auditor
• noneoftheservicesunderminethegeneralprinciplesrelatingtoauditorindependenceassetoutinAPES110
CodeofEthicsforProfessionalAccountants,includingreviewingorauditingtheauditor’sownwork,actingin
amanagementoradecision-makingcapacityforthecompany,actingasadvocateforthecompanyorjointly
sharingeconomicriskandrewards.
Directors’ meetings (continued)
Annual report Inglewood & Districts Community Enterprises Limited10
Directors’ report (continued)
Auditor’s independence declaration
Acopyoftheauditor’sindependencedeclarationasrequiredundersection307CoftheCorporationsAct2001is
setoutonpage11.
SignedinaccordancewitharesolutionoftheboardofdirectorsatInglewood,Victoriaon1September2014.
Maxwell Charles Higgs,
Chairman
Annual report Inglewood & Districts Community Enterprises Limited 11
Auditor’s independence declaration
Annual report Inglewood & Districts Community Enterprises Limited12
Financial statementsStatementofComprehensiveIncome for the year ended 30 June 2014
Note 2014 2013 $ $
Revenuefromordinaryactivities 4 819,229 802,740
Employeebenefitsexpense (397,181) (359,639)
Charitabledonations,sponsorship,advertisingandpromotion (181,952) (178,143)
Occupancyandassociatedcosts (28,892) (27,561)
Systemscosts (21,139) (21,415)
Depreciationandamortisationexpense 5 (23,914) (22,544)
Generaladministrationexpenses (147,275) (139,082)
Profit before income tax expense 18,876 54,356
Incometaxexpense 6 (5,602) (16,367)
Profit after income tax expense 13,274 37,989
Total comprehensive income for the year 13,274 37,989
Earnings per share for profit attributable to the ordinary
shareholders of the company: ¢ ¢
Basicearningspershare 19 2.63 7.52
Theaccompanyingnotesformpartofthesefinancialstatements.
Annual report Inglewood & Districts Community Enterprises Limited 13
Financial statements (continued)
BalanceSheet as at 30 June 2014
Note 2014 2013 $ $
ASSETS
Current Assets
Cashandcashequivalents 7 211,571 220,255
Tradeandotherreceivables 8 39,567 44,009
Currenttaxasset 11 732 -
Total Current Assets 251,870 264,264
Non-Current Assets
Property,plantandequipment 9 91,671 88,656
Intangibleassets 10 152,438 166,302
Total Non-Current Assets 244,109 254,958
Total Assets 495,979 519,222
LIABILITIES
Current Liabilities
Tradeandotherpayables 12 7,188 5,136
Currenttaxliabilities 11 (7,184) 1,140
Total Current Liabilities 4 6,276
Non-Current Liabilities
Deferredtaxliabilities 11 1,580 1,500
Total Non-Current Liabilities 1,580 1,500
Total Liabilities 1,584 7,776
Net Assets 494,395 511,446
Equity
Issuedcapital 13 488,516 488,516
Retainedearnings 14 5,879 22,930
Total Equity 494,395 511,446
Theaccompanyingnotesformpartofthesefinancialstatements.
Annual report Inglewood & Districts Community Enterprises Limited14
Financial statements (continued)
StatementofChangesinEquity for the year ended 30 June 2014
Issued Retained Total capital earnings equity $ $ $
Balance at 1 July 2012 488,516 (15,059) 473,457
Total comprehensive income for the year - 37,989 37,989
Transactions with owners in their capacity as owners:
Sharesissuedduringperiod - - -
Costsofissuingshares - - -
Dividendsprovidedfororpaid - - -
Balance at 30 June 2013 488,516 22,930 511,446
Balance at 1 July 2013 488,516 22,930 511,446
Total comprehensive income for the year - 13,274 13,274
Transactions with owners in their capacity as owners:
Sharesissuedduringperiod - - -
Costsofissuingshares - - -
Dividendsprovidedfororpaid - (30,325) (30,325)
Balance at 30 June 2014 488,516 5,879 494,395
Theaccompanyingnotesformpartofthesefinancialstatements.
Annual report Inglewood & Districts Community Enterprises Limited 15
Financial statements (continued)
StatementofCashFlows for the year ended 30 June 2014
Note 2014 2013 $ $
Cash flows from operating activities
Receiptsfromcustomers 862,145 867,471
Paymentstosuppliersandemployees (821,727) (828,314)
Interestreceived 8,134 11,958
Incometaxespaid (13,846) (34,887)
Net cash provided by operating activities 15 34,706 16,228
Cash flows from investing activities
Paymentsforproperty,plantandequipment (13,065) -
Net cash used in investing activities (13,065) -
Cash flows from financing activities
Dividendspaid (30,325) -
Net cash used in financing activities (30,325) -
Net increase/(decrease) in cash held (8,684) 16,228
Cashandcashequivalentsatthebeginningofthefinancialyear 220,255 204,027
Cash and cash equivalents at the end of the financial year 7(a) 211,571 220,255
Theaccompanyingnotesformpartofthesefinancialstatements.
Annual report Inglewood & Districts Community Enterprises Limited16
NotestothefinancialstatementsFor year ended 30 June 2014
Note1.Summaryofsignificantaccountingpolicies
a) Basis of preparation
ThesegeneralpurposefinancialstatementshavebeenpreparedinaccordancewithAustralianAccounting
StandardsandInterpretationsissuedbytheAustralianAccountingStandardBoardsandtheCorporationsAct
2001.Thecompanyisafor-profitentityforthepurposeofpreparingthefinancialstatements.
CompliancewithIFRS
ThesefinancialstatementsandnotescomplywithInternationalFinancialReportingStandards(IFRS)asissuedby
theInternationalAccountingStandardsBoard(IASB).
Critical accounting estimates
Thepreparationofthefinancialstatementsrequirestheuseofcertaincriticalaccountingestimates.Italso
requiresmanagementtoexerciseitsjudgementintheprocessofapplyingthecompany’saccountingpolicies.
Theseareasinvolvingahigherdegreeofjudgementorcomplexities,orareaswhereassumptionsandestimates
aresignificanttothefinancialstatementsaredisclosedinnote3.
Historicalcostconvention
Thefinancialstatementshavebeenpreparedunderthehistoricalcostconventiononanaccrualsbasisas
modifiedbytherevaluationoffinancialassetsandliabilitiesatfairvaluethroughprofitorlossandwherestated,
currentvaluationsofnon-currentassets.Costisbasedonthefairvaluesoftheconsiderationgiveninexchange
forassets.
Comparativefigures
WhererequiredbyAustralianAccountingStandardscomparativefigureshavebeenadjustedtoconformwith
changesinpresentationforthecurrentfinancialyear.
Adoption of new and amended accounting standards
Thecompanyadoptedthefollowingstandardsandamendments,mandatoryforthefirsttimefortheannual
reporting period commencing 1 July 2013:
• AASB2011-4AmendmentstoAustralianAccountingStandardstoRemoveIndividualKeyManagement
PersonnelDisclosureRequirements.
• AASB10ConsolidatedFinancialStatements,AASB11JointArrangements,AASB12DisclosureofInterests
inOtherEntities,AASB128InvestmentsinAssociatesandJointVentures,AASB127SeparateFinancial
StatementsandAASB2011-7AmendmentstoAustralianAccountingStandardsarisingfromtheConsolidation
andJointArrangementsStandards.
• AASB2012-9AmendmenttoAASB1048arisingfromtheWithdrawalofAustralianInterpretation1039.
• AASB2012-10AmendmentstoAustralianAccountingStandards–TransitionGuidanceandotherAmendments
whichprovidesanexemptionfromtherequirementtodisclosetheimpactofthechangeinaccountingpolicyon
thecurrentperiod.
• AASB13FairValueMeasurementandAASB2011-8AmendmentstoAustralianAccountingStandardsarising
fromAASB13.
Annual report Inglewood & Districts Community Enterprises Limited 17
Notestothefinancialstatements(continued)
Note1.Summaryofsignificantaccountingpolicies(continued)
a) Basis of preparation (continued)
Adoption of new and amended accounting standards (continued)
• AASB119EmployeeBenefits(September2011)andAASB2011-10AmendmentstoAustralianAccounting
StandardsarisingfromAASB119(September2011).
• AASB2012-5AmendmentstoAustralianAccountingStandardsarisingfromAnnualImprovements2009-2011
Cycle.
• AASB2012-2AmendmentstoAustralianAccountingStandards–Disclosures–OffsettingFinancialAssetsand
FinancialLiabilities.
AASB2011-4removestheindividualkeymanagementpersonneldisclosurerequirementsinAASB124Related
PartyDisclosures.Asaresultthecompanynowonlydisclosesthekeymanagementpersonnelcompensationin
totalandforeachofthecategoriesrequiredinAASB124.Detailedkeymanagementpersonnelcompensationis
outlinedintheremunerationreport,includedaspartofthedirectors’report.
TheadoptionofrevisedstandardAASB119hasresultedinachangetotheaccountingforthecompany’sannual
leaveobligations.Astheentitydoesnotexpectallannualleavetobetakenwithin12monthsoftherespective
servicebeingprovided,annualleaveobligationsarenowclassifiedaslong-termemployeebenefitsintheirentirety.
Thischangesthemeasurementoftheseobligations,astheentireobligationisnowmeasuredonadiscounted
basisandnolongersplitintoashort-termandalong-termportion.However,theimpactofthischangeis
consideredimmaterialonthefinancialstatementsoverallasthemajorityoftheannualleaveisstillexpectedtobe
takenwithin12monthsaftertheendofthereportingperiod.
Noneoftheremainingnewstandardsandamendmentstostandardsthataremandatoryforthefirsttimeforthe
financialyearbeginning1July2013affectedanyoftheamountsrecognisedinthecurrentperiodoranyprior
periodandarenotlikelytoaffectfutureperiods.
The company has not elected to apply any pronouncements before their mandatory operative date in the annual
reportingperiodbeginning1July2013.
Economicdependency-BendigoandAdelaideBankLimited
ThecompanyhasenteredintoafranchiseagreementwithBendigoandAdelaideBankLimitedthatgovernsthe
management of the Community Bank® branchatInglewood,Victoria.
ThebranchoperatesasafranchiseofBendigoandAdelaideBankLimited,usingthename“BendigoBank”and
thelogoandsystemofoperationsofBendigoandAdelaideBankLimited.ThecompanymanagestheCommunity
Bank® branchonbehalfofBendigoandAdelaideBankLimited,howeveralltransactionswithcustomersconducted
through the Community Bank® branch are effectively conducted between the customers and Bendigo and Adelaide
BankLimited.
AlldepositsaremadewithBendigoandAdelaideBankLimited,andallpersonalandinvestmentproductsare
productsofBendigoandAdelaideBankLimited,withthecompanyfacilitatingtheprovisionofthoseproducts.All
loans,leasesorhirepurchasetransactions,issuesofnewcreditordebitcards,temporaryorbridgingfinanceand
anyothertransactionthatinvolvescreatinganewdebt,orincreasingorchangingthetermsofanexistingdebt
owedtoBendigoandAdelaideBankLimited,mustbeapprovedbyBendigoandAdelaideBankLimited.Allcredit
transactionsaremadewithBendigoandAdelaideBankLimited,andallcreditproductsareproductsofBendigo
andAdelaideBankLimited.
BendigoandAdelaideBankLimitedprovidessignificantassistanceinestablishingandmaintainingtheCommunity
Bank® branchfranchiseoperations.Italsocontinuestoprovideongoingmanagementandoperationalsupport
andotherassistanceandguidanceinrelationtoallaspectsofthefranchiseoperation,includingadviceinrelation
to:
Annual report Inglewood & Districts Community Enterprises Limited18
Notestothefinancialstatements(continued)
Note1.Summaryofsignificantaccountingpolicies(continued)
a) Basis of preparation (continued)
Economicdependency-BendigoandAdelaideBankLimited(continued)
•adviceandassistanceinrelationtothedesign,layoutandfitoutoftheCommunity Bank® branch
•trainingforthebranchmanagerandotheremployeesinbanking,managementsystemsandinterfaceprotocol
•methodsandproceduresforthesaleofproductsandprovisionofservices
•securityandcashlogisticcontrols
•calculationofcompanyrevenueandpaymentofmanyoperatingandadministrativeexpenses
•theformulationandimplementationofadvertisingandpromotionalprograms
•salestechniquesandpropercustomerrelations.
The following is a summary of the material accounting policies adopted by the company in the preparation of the
financialstatements.Theaccountingpolicieshavebeenconsistentlyapplied,unlessotherwisestated.
b) Revenue
Revenueisrecognisedwhentheamountofrevenuecanbereliablymeasured,itisprobablethatfutureeconomic
benefitswillflowtothecompanyandanyspecificcriteriahavebeenmet.Interestandfeerevenueisrecognised
whenearned.Thegainorlossondisposalofproperty,plantandequipmentisrecognisedonanetbasisandis
classifiedasincomeratherthanrevenue.AllrevenueisstatednetoftheamountofGoodsandServicesTax(GST).
Revenuecalculation
ThefranchiseagreementwithBendigoandAdelaideBankLimitedprovidesforthreetypesofrevenueearnedby
thecompany.First,thecompanyisentitledto50%ofthemonthlygrossmarginearnedbyBendigoandAdelaide
BankLimitedonproductsandservicesprovidedthroughthecompanythatareregardedas“daytoday”banking
business(i.e.‘marginbusiness’).Thisarrangementalsomeansthatifthegrossmarginreflectsaloss(thatis,the
grossmarginisanegativeamount),thecompanyeffectivelyincurs,andmustbear,50%ofthatloss.
ThesecondsourceofrevenueiscommissionpaidbyBendigoandAdelaideBankLimitedontheotherproducts
andservicesprovidedthroughthecompany(i.e.‘commissionbusiness’).Thecommissioniscurrentlypayable
onvariousspecifiedproductsandservices,includinginsurance,financialplanning,commonfund,Sandhurst
Select,superannuation,commercialloanreferrals,productsreferredbyRuralBank,leasingreferrals,fixedloans
andcertaintermdeposits(>90days).Theamountofcommissionpayablecanbevariedinaccordancewith
theFranchiseAgreement(which,insomecases,permitscommissionstobevariedatthediscretionofBendigo
andAdelaideBankLimited).Thisdiscretionhasbeenexercisedonseveraloccasionspreviously.Forexamplein
February2011andFebruary2013BendigoandAdelaideBankLimitedreducedcommissionsontwocorebanking
productstoensureamoreevendistributionofincomebetweenBendigoandAdelaideBankLimitedandits
Community Bank® partners.Therevenuesharemodelissubjecttoregularreviewtoensurethattheinterestsof
BendigoandAdelaideBankLimitedandCommunity Bank® companiesremainbalanced.
Thethirdsourceofrevenueisaproportionofthefeesandcharges(i.e.whatarecommonlyreferredtoas‘bank
feesandcharges’)chargedtocustomers.Thisproportion,determinedbyBendigoandAdelaideBankLimited,may
varybetweenproductsandservicesandmaybeamendedbyBendigoandAdelaideBankLimitedfromtimeto
time.
Annual report Inglewood & Districts Community Enterprises Limited 19
Notestothefinancialstatements(continued)
Note1.Summaryofsignificantaccountingpolicies(continued)
c) Income tax
Current tax
Current tax is calculated by reference to the amount of income taxes payable or recoverable in respect of the
taxableprofitorlossfortheperiod.Itiscalculatedusingtaxratesandtaxlawsthathavebeenenactedor
substantivelyenactedbyreportingdate.Currenttaxforcurrentandpriorperiodsisrecognisedasaliability(or
asset)totheextentthatitisunpaid(orrefundable).
Deferred tax
Deferred tax is accounted for using the balance sheet liability method on temporary differences arising from
differencesbetweenthecarryingamountofassetsandliabilitiesinthefinancialstatementsandthecorresponding
taxbaseofthoseitems.
Inprinciple,deferredtaxliabilitiesarerecognisedforalltaxabletemporarydifferences.Deferredtaxassets
arerecognisedtotheextentthatitisprobablethatsufficienttaxableamountswillbeavailableagainstwhich
deductibletemporarydifferencesorunusedtaxlossesandtaxoffsetscanbeutilised.However,deferredtax
assets and liabilities are not recognised if the temporary differences giving rise to them arise from the initial
recognition of assets and liabilities (other than as a result of a business combination) which affects neither
taxableincomenoraccountingprofit.Furthermore,adeferredtaxliabilityisnotrecognisedinrelationtotaxable
temporarydifferencesarisingfromgoodwill.
Deferred tax assets and liabilities are measured at the tax rates that are expected to apply to the period(s) when
theassetandliabilitygivingrisetothemarerealisedorsettled,basedontaxrates(andtaxlaws)thathavebeen
enactedorsubstantivelyenactedbyreportingdate.Themeasurementofdeferredtaxliabilitiesreflectsthetax
consequencesthatwouldfollowfromthemannerinwhichtheconsolidatedentityexpects,atthereportingdate,to
recoverorsettlethecarryingamountofitsassetsandliabilities.
Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax and
when the balances relate to taxes levied by the same taxation authority and the company entity intends to settle
itstaxassetsandliabilitiesonanetbasis.
Current and deferred tax for the period
Currentanddeferredtaxisrecognisedasanexpenseorincomeinthestatementofcomprehensiveincome,
exceptwhenitrelatestoitemscreditedordebitedtoequity,inwhichcasethedeferredtaxisalsorecognised
directlyinequity,orwhereitarisesfrominitialaccountingforabusinesscombination,inwhichcaseitistakeninto
accountinthedeterminationofgoodwillorexcess.
d) Employee entitlements
Provisionismadeforthecompany’sliabilityforemployeebenefitsarisingfromservicesrenderedbyemployees
tobalancedate.Employeebenefitsthatareexpectedtobesettledwithinoneyearhavebeenmeasuredatthe
amountsexpectedtobepaidwhentheliabilityissettled,plusrelatedon-costs.Employeebenefitspayablelater
thanoneyearhavebeenmeasuredatthepresentvalueoftheestimatedfuturecashoutflowstobemadefor
thosebenefits.
Thecompanycontributestoadefinedcontributionplan.Contributionstoemployeesuperannuationfundsare
chargedagainstincomeasincurred.
Annual report Inglewood & Districts Community Enterprises Limited20
Notestothefinancialstatements(continued)
Note1.Summaryofsignificantaccountingpolicies(continued)
e) Cash and cash equivalents
Forthepurposesofthestatementofcashflows,cashincludescashonhandandinbanksandinvestmentsin
moneymarketinstruments,netofoutstandingbankoverdrafts.Bankoverdraftsareshownwithinborrowingsin
currentliabilitiesonthebalancesheet.
f) Trade receivables and payables
Receivablesarecarriedattheiramountsdue.Thecollectabilityofdebtsisassessedatbalancedateandspecific
provisionismadeforanydoubtfulaccounts.Liabilitiesfortradecreditorsandotheramountsarecarriedatcost
thatisthefairvalueoftheconsiderationtobepaidinthefutureforgoodsandservicesreceived,whetherornot
billedtothecompany.
g) Property, plant and equipment
Plantandequipment,leaseholdimprovementsandequipmentunderfinanceleasearestatedatcostless
accumulateddepreciationandimpairment.Costincludesexpenditurethatisdirectlyattributabletotheacquisition
oftheitem.Intheeventthatsettlementofallorpartofthepurchaseconsiderationisdeferred,costisdetermined
bydiscountingtheamountspayableinthefuturetotheirpresentvalueasatthedateofacquisition.
Depreciationisprovidedonproperty,plantandequipment,includingfreeholdbuildingsbutexcludingland.
Depreciation is calculated on a straight line basis so as to write off the net cost of each asset over its expected
usefullifetoitsestimatedresidualvalue.Leaseholdimprovementsaredepreciatedattherateequivalentto
theavailablebuildingallowanceusingthestraightlinemethod.Theestimatedusefullives,residualvaluesand
depreciationmethodarereviewedattheendofeachannualreportingperiod.
The following estimated useful lives are used in the calculation of depreciation:
-leaseholdimprovements 40 years
-plantandequipment 2.5-40 years
-furnitureandfittings 4-40 years
h) Intangibles
ThefranchisefeepaidtoBendigoandAdelaideBankLimitedhasbeenrecordedatcostandisamortisedona
straightlinebasisoverthelifeofthefranchiseagreement.
TherenewalprocessingfeepaidtoBendigoandAdelaideBankLimitedwhenrenewingthefranchiseagreement
hasalsobeenrecordedatcostandisamortisedonastraightlinebasisoverthelifeofthefranchiseagreement.
i) Payment terms
Receivablesandpayablesarenoninterestbearingandgenerallyhavepaymenttermsofbetween30and90days.
j) Borrowings
Allloansareinitiallymeasuredattheprincipalamount.Interestisrecognisedasanexpenseasitaccrues.
Annual report Inglewood & Districts Community Enterprises Limited 21
Notestothefinancialstatements(continued)
Note1.Summaryofsignificantaccountingpolicies(continued)
k) Financial instruments
Recognitionandinitialmeasurement
Financialinstruments,incorporatingfinancialassetsandfinancialliabilitiesarerecognisedwhentheentity
becomesapartytothecontractualprovisionsoftheinstrument.
Financialinstrumentsareinitiallymeasuredatfairvalueplustransactioncosts.Financialinstrumentsare
classifiedandmeasuredassetoutbelow.
Derecognition
Financialassetsarederecognisedwherethecontractualrightstoreceiptofcashflowsexpiresortheassetis
transferredtoanotherpartywherebytheentitynolongerhasanysignificantcontinuinginvolvementintherisks
andbenefitsassociatedwiththeasset.
Classificationandsubsequentmeasurement
(i) Loansandreceivables
Loansandreceivablesarenon-derivativefinancialassetswithfixedordeterminablepaymentsthatarenot
quotedinanactivemarketandaresubsequentlymeasuredatamortisedcostusingtheeffectiveinterestrate
method.
(ii) Held-to-maturityinvestments
Held-to-maturityinvestmentsarenon-derivativefinancialassetsthathavefixedmaturitiesandfixedor
determinablepayments,anditistheentity’sintentiontoholdtheseinvestmentstomaturity.Theyare
subsequentlymeasuredatamortisedcostusingtheeffectiveinterestratemethod.
(iii)Available-for-salefinancialassets
Available-for-salefinancialassetsarenon-derivativefinancialassetsthatareeithernotsuitabletobeclassified
intoothercategoriesoffinancialassetsduetotheirnature,ortheyaredesignatedassuchbymanagement.
Theycompriseinvestmentsintheequityofotherentitieswherethereisneitherafixedmaturitynorfixedor
determinablepayments.
Theyaresubsequentlymeasuredatfairvaluewithchangesinsuchfairvalue(i.e.gainsorlosses)recognised
intheStatementofComprehensiveIncome.Available-for-salefinancialassetsareincludedinnon-current
assetsexceptwherethatareexpectedtobesoldwithin12monthsaftertheendofthereportingperiod.All
otherfinancialassetsareclassifiedascurrentassets.
(iv) Financial liabilities
Non-derivativefinancialliabilities(excludingfinancialguarantees)aresubsequentlymeasuredatamortisedcost
usingtheeffectiveinterestratemethod.
Impairment
Ateachreportingdate,theentityassesseswhetherthereisobjectiveevidencethatafinancialinstrumenthas
beenimpaired.Impairmentlossesarerecognisedinthestatementofcomprehensiveincome.
Annual report Inglewood & Districts Community Enterprises Limited22
Notestothefinancialstatements(continued)
Note1.Summaryofsignificantaccountingpolicies(continued)
l) Leases
Leasesoffixedassetswheresubstantiallyalltherisksandbenefitsincidentaltotheownershipoftheasset,
butnotthelegalownershiparetransferredtothecompanyareclassifiedasfinanceleases.Financeleasesare
capitalisedbyrecordinganassetandaliabilityattheloweroftheamountsequaltothefairvalueoftheleased
propertyorthepresentvalueoftheminimumleasepayments,includinganyguaranteedresidualvalues.Lease
paymentsareallocatedbetweenthereductionoftheleaseliabilityandtheleaseinterestexpensefortheperiod.
Leasedassetsaredepreciatedonastraight-linebasisovertheshorteroftheirestimatedusefullivesorthelease
term.Leasepaymentsforoperatingleases,wheresubstantiallyalltherisksandbenefitsremainwiththelessor,
arechargedasexpensesintheperiodsinwhichtheyareincurred.Leaseincentivesunderoperatingleasesare
recognisedasaliabilityandamortisedonastraight-linebasisoverthelifeoftheleaseterm.
m) Provisions
Provisionsarerecognisedwhentheeconomicentityhasalegal,equitableorconstructiveobligationtomakea
futuresacrificeofeconomicbenefitstootherentitiesasaresultofpasttransactionsofotherpastevents,itis
probablethatafuturesacrificeofeconomicbenefitswillberequiredandareliableestimatecanbemadeofthe
amountoftheobligation.
Aprovisionfordividendsisnotrecognisedasaliabilityunlessthedividendsaredeclared,determinedorpublicly
recommendedonorbeforethereportingdate.
n) Contributed equity
Ordinarysharesarerecognisedatthefairvalueoftheconsiderationreceivedbythecompany.Anytransaction
costsarisingontheissueofordinarysharesarerecogniseddirectlyinequityasareductionoftheshareproceeds
received.
o) Earnings per share
Basicearningspershareiscalculatedbydividingtheprofitattributabletoequityholdersofthecompany,excluding
anycostsofservicingequityotherthanordinaryshares,bytheweightedaveragenumberofordinaryshares
outstandingduringthefinancialyear,adjustedforbonuselementsinordinarysharesissuedduringtheyear.
p) Goods and Services Tax
Revenues,expensesandassetsarerecognisednetoftheamountofGoodsandServicesTax(GST),exceptwhere
theamountofGSTincurredisnotrecoverablefromthetaxationauthority.Inthesecircumstances,theGSTis
recognisedaspartofthecostofacquisitionoftheassetoraspartoftheexpense.
ReceivablesandpayablesarestatedwiththeamountofGSTincluded.ThenetamountofGSTrecoverablefrom,
orpayableto,thetaxationauthorityisincludedaspartofreceivablesorpayablesinthebalancesheet.Cashflows
areincludedinthestatementofcashflowsonagrossbasis.
TheGSTcomponentsofcashflowsarisingfrominvestingandfinancingactivitieswhicharerecoverablefrom,or
payableto,thetaxationauthorityareclassifiedasoperatingcashflows.
Annual report Inglewood & Districts Community Enterprises Limited 23
Notestothefinancialstatements(continued)
Note2.FinancialriskmanagementThecompany’sactivitiesexposeittoalimitedvarietyoffinancialrisks:marketrisk(includingcurrencyrisk,fair
valueinterestriskandpricerisk),creditrisk,liquidityriskandcashflowinterestraterisk.Thecompany’soverall
riskmanagementprogramfocusesontheunpredictabilityoffinancialmarketsandseekstominimisepotential
adverseeffectsonthefinancialperformanceoftheentity.Theentitydoesnotusederivativeinstruments.
Riskmanagementiscarriedoutdirectlybytheboardofdirectors.
(i) Marketrisk
ThecompanyhasnoexposuretoanytransactionsdenominatedinacurrencyotherthanAustraliandollars.
(ii) Pricerisk
Thecompanyisnotexposedtoequitysecuritiespriceriskasitdoesnotholdinvestmentsforsaleoratfair
value.Thecompanyisnotexposedtocommoditypricerisk.
(iii)Creditrisk
Thecompanyhasnosignificantconcentrationsofcreditrisk.Ithaspoliciesinplacetoensurethatcustomers
haveanappropriatecredithistory.Thecompany’sfranchiseagreementlimitsthecompany’screditexposureto
onefinancialinstitution,beingBendigoandAdelaideBankLimited.
(iv)Liquidityrisk
Prudentliquiditymanagementimpliesmaintainingsufficientcashandmarketablesecuritiesandtheavailability
offundingfromcreditfacilities.ThecompanybelievesthatitssoundrelationshipwithBendigoandAdelaide
BankLimitedmitigatesthisrisksignificantly.
(v) Cashflowandfairvalueinterestraterisk
Interest-bearingassetsareheldwithBendigoandAdelaideBankLimitedandsubjecttomovementsinmarket
interest.Interest-rateriskcouldalsoarisefromlong-termborrowings.Borrowingsissuedatvariablerates
exposethecompanytocashflowinterest-raterisk.Thecompanybelievesthatitssoundrelationshipwith
BendigoandAdelaideBankLimitedmitigatesthisrisksignificantly.
(vi) Capital management
Theboard’spolicyistomaintainastrongcapitalbasesoastosustainfuturedevelopmentofthecompany.
Theboardofdirectorsmonitorthereturnoncapitalandthelevelofdividendstoshareholders.Capitalis
representedbytotalequityasrecordedinthebalancesheet.
Inaccordancewiththefranchiseagreement,inany12monthperiod,thefundsdistributedtoshareholders
shall not exceed the distribution limit:
The distribution limit is the greater of:
(a)20%oftheprofitorfundsofthefranchiseeotherwiseavailablefordistributiontoshareholdersinthat12
month period; and
(b) subjecttotheavailabilityofdistributableprofits,therelevantrateofreturnmultipliedbytheaveragelevelof
sharecapitalofthefranchiseeoverthat12monthperiodwheretherelevantrateofreturnisequaltothe
weightedaverageinterestrateon90daybankbillsoverthat12monthperiodplus5%.
Theboardismanagingthegrowthofthebusinessinlinewiththisrequirement.Therearenootherexternally
imposedcapitalrequirements,althoughthenatureofthecompanyissuchthatamountswillbepaidinthe
formofcharitabledonationsandsponsorship.Charitabledonationsandsponsorshippaidfortheyearended
30June2014canbeseeninthestatementofcomprehensiveincome.
Therewerenochangesinthecompany’sapproachtocapitalmanagementduringtheyear.
Annual report Inglewood & Districts Community Enterprises Limited24
Notestothefinancialstatements(continued)
Note3.CriticalaccountingestimatesandjudgementsEstimatesandjudgementsarecontinuallyevaluatedandarebasedonhistoricalexperienceandotherfactors,
includingexpectationsoffutureeventsthatmayhaveafinancialimpactontheentityandthatarebelievedtobe
reasonableunderthecircumstances.
Thecompanymakesestimatesandassumptionsconcerningthefuture.Theresultingaccountingestimateswill,by
definition,seldomequaltherelatedactualresults.
Managementhasidentifiedthefollowingcriticalaccountingpoliciesforwhichsignificantjudgements,estimates
andassumptionsaremade.Actualresultsmaydifferfromtheseestimatesunderdifferentassumptionsand
conditionsandmaymateriallyaffectfinancialresultsorthefinancialpositionreportedinfutureperiods.
Further details of the nature of these assumptions and conditions may be found in the relevant notes to the
financialstatements.
Taxation
Judgementisrequiredinassessingwhetherdeferredtaxassetsandcertaintaxliabilitiesarerecognisedon
thebalancesheet.Deferredtaxassets,includingthosearisingfromun-recoupedtaxlosses,capitallossesand
temporarydifferences,arerecognisedonlywhereitisconsideredmorelikelythannotthattheywillberecovered,
whichisdependentonthegenerationofsufficientfuturetaxableprofits.
Assumptionsaboutthegenerationoffuturetaxableprofitsdependonmanagement’sestimatesoffuturecash
flows.Thesedependonestimatesoffuturesalesvolumes,operatingcosts,capitalexpenditure,dividendsand
othercapitalmanagementtransactions.Judgementsarealsorequiredabouttheapplicationofincometax
legislation.
Thesejudgementsandassumptionsaresubjecttoriskanduncertainty.Thereisthereforeapossibilitythat
changesincircumstanceswillalterexpectations,whichmayimpacttheamountofdeferredtaxassetsand
deferred tax liabilities recognised on the balance sheet and the amount of other tax losses and temporary
differencesnotyetrecognised.Insuchcircumstances,someorallofthecarryingamountofrecogniseddeferred
taxassetsandliabilitiesmayrequireadjustment,resultingincorrespondingcreditorchargetothestatementof
comprehensiveincome.
Estimationofusefullivesofassets
The estimation of the useful lives of assets has been based on historical experience and the condition of the
assetisassessedatleastonceperyearandconsideredagainsttheremainingusefullife.Adjustmentstouseful
livesaremadewhenconsiderednecessary.
Goodwill
Goodwillrepresentstheexcessofthecostofanacquisitionoverthefairvalueofthecompany’sshareofthenet
identifiableassetsoftheacquiredbranch/agencyatthedateofacquisition.Goodwillonacquisitionisincludedin
intangibleassets.Goodwillisnotamortised.Instead,goodwillistestedforimpairmentannually,ormorefrequently
if events or changes in circumstances indicate that it might be impaired and is carried at cost less accumulated
impairmentlosses.
Thecalculationsrequiretheuseofassumptions.
Annual report Inglewood & Districts Community Enterprises Limited 25
Notestothefinancialstatements(continued)
Note3.Criticalaccountingestimatesandjudgements(continued)
Impairment of assets
Ateachreportingdate,thecompanyreviewsthecarryingamountsofitstangibleandintangibleassetsthathave
anindefiniteusefullifetodeterminewhetherthereisanyindicationthatthoseassetshavesufferedanimpairment
loss.Ifanysuchindicationexists,therecoverableamountoftheassetisestimatedinordertodeterminethe
extentoftheimpairmentloss(ifany).Wheretheassetdoesnotgeneratecashflowsthatareindependentfrom
otherassets,theconsolidatedentityestimatestherecoverableamountofthecash-generatingunittowhichthe
assetbelongs.
Recoverableamountisthehigheroffairvaluelesscoststosellandvalueinuse.Inassessingvalueinuse,the
estimatedfuturecashflowsarediscountedtotheirpresentvalueusingapre-taxdiscountratethatreflectscurrent
marketassessmentsofthetimevalueofmoneyandtherisksspecifictotheassetforwhichtheestimatesof
futurecashflowshavenotbeenadjusted.
Iftherecoverableamountofanasset(orcash-generatingunit)isestimatedtobelessthanitscarryingamount,
thecarryingamountoftheasset(cash-generatingunit)isreducedtoitsrecoverableamount.Animpairmentloss
isrecognisedinprofitorlossimmediately,unlesstherelevantassetiscarriedatfairvalue,inwhichcasethe
impairmentlossistreatedasarevaluationdecrease.
Whereanimpairmentlosssubsequentlyreverses,thecarryingamountoftheasset(cash-generatingunit)is
increasedtotherevisedestimateofitsrecoverableamount,butonlytotheextentthattheincreasedcarrying
amount does not exceed the carrying amount that would have been determined had no impairment loss been
recognisedfortheasset(cash-generatingunit)inprioryears.Areversalofanimpairmentlossisrecognised
inprofitorlossimmediately,unlesstherelevantassetiscarriedatfairvalue,inwhichcasethereversalofthe
impairmentlossistreatedasarevaluationincrease.
2014 2013 $ $
Note4.RevenuefromordinaryactivitiesOperating activities:
-servicescommissions 811,139 790,928
Total revenue from operating activities 811,139 790,928
Non-operatingactivities:
-interestreceived 8,090 11,812
Total revenue from non-operating activities 8,090 11,812
Total revenues from ordinary activities 819,229 802,740
Annual report Inglewood & Districts Community Enterprises Limited26
Notestothefinancialstatements(continued)
Note5.ExpensesDepreciationofnon-currentassets:
-plantandequipment 3,006 2,102
-leaseholdimprovements 7,043 6,577
Amortisationofnon-currentassets:
-franchiseagreement 2,311 2,311
-franchiserenewalfee 11,554 11,554
23,914 22,544
Bad debts 1,841 162
Note6.IncometaxexpenseThe components of tax expense comprise:
-Currenttax 5,583 16,591
-Movementindeferredtax 80 (224)
-Overprovisionoftaxinthepriorperiod (61)
5,602 16,367
Theprimafacietaxonprofitfromordinaryactivitiesbeforeincome
tax is reconciled to the income tax expense as follows:
Operatingprofit 18,876 54,356
Primafacietaxonprofitfromordinaryactivitiesat30% 5,663 16,367
Add tax effect of:
-timingdifferenceexpenses (80) 224
5,583 16,591
Movementindeferredtax 11 80 (224)
Overprovisionofincometaxintheprioryear (61) -
5,602 16,367
Note7.CashandcashequivalentsCashatbankandonhand 11,571 20,255
Termdeposits 200,000 200,000
211,571 220,255
Note 2014 2013 $ $
Annual report Inglewood & Districts Community Enterprises Limited 27
Notestothefinancialstatements(continued)
Note7.Cashandcashequivalents(continued)
Note 7.(a) Reconciliation to cash flow statement
Theabovefiguresreconciletotheamountofcashshowninthestatementof
cashflowsattheendofthefinancialyearasfollows:
Cashatbankandonhand 11,571 20,255
Termdeposits 200,000 200,000
211,571 220,255
Note8.TradeandotherreceivablesTradereceivables 34,302 39,009
Otherreceivablesandaccruals 94 138
Prepayments 5,171 4,862
39,567 44,009
Note9.Property,plantandequipmentPlant and equipment
Atcost 29,487 27,787
Lessaccumulateddepreciation (24,017) (22,339)
5,470 5,448
Leasehold improvements
Atcost 134,129 134,129
Lessaccumulateddepreciation (56,638) (50,921)
77,491 83,208
Motor Vehicle
Atcost 11,364 -
Lessaccumulateddepreciation (2,654) -
8,710 -
Total written down amount 91,671 88,656
2014 2013 $ $
Annual report Inglewood & Districts Community Enterprises Limited28
Notestothefinancialstatements(continued)
Note9.Property,plantandequipment(continued)
Movements in carrying amounts:
Plant and equipment
Carryingamountatbeginning 5,448 7,550
Additions 1,700 -
Disposals - -
Less:depreciationexpense (1,678) (2,102)
Carrying amount at end 5,470 5,448
Leasehold improvements
Carryingamountatbeginning 83,208 89,785
Additions - -
Disposals - -
Less:depreciationexpense (5,717) (6,577)
Carrying amount at end 77,491 83,208
Motor Vehicle
Carryingamountatbeginning - -
Additions 11,364 -
Disposals - -
Less:depreciationexpense (2,654) -
Carrying amount at end 8,710 -
Total written down amount 91,671 88,656
Note10.IntangibleassetsFranchise fee
Atcost 21,554 21,554
Less:accumulatedamortisation (14,814) (12,503)
6,740 9,051
Renewal processing fee
Atcost 57,768 57,768
Less:accumulatedamortisation (24,070) (12,517)
33,698 45,251
2014 2013 $ $
Annual report Inglewood & Districts Community Enterprises Limited 29
Notestothefinancialstatements(continued)
Note10.Intangibleassets(continued)
Goodwill on Purchase of Agency Business
Atcost 112,000 112,000
112,000 112,000
Total written down amount 152,438 166,302
Note11.TaxCurrent:
Income tax payable/(refundable) (732) 1,140
Non-Current:
Deferred tax liability
-accruals 29 41
-deductibleprepayments 1,551 1,459
1,580 1,500
Net deferred tax liability 1,580 1,500
Movement in deferred tax charged to statement of comprehensive income (80) 224
Note12.TradeandotherpayablesTradecreditors 3,638 1,100
Othercreditorsandaccruals 3,550 4,036
7,188 5,136
Note13.Contributedequity505,412ordinarysharesfullypaid(2013:505,412) 505,412 505,412
Less:equityraisingexpenses (16,896) (16,896)
488,516 488,516
2014 2013 $ $
Annual report Inglewood & Districts Community Enterprises Limited30
Notestothefinancialstatements(continued)
Note13.Contributedequity(continued)
Rightsattachedtoshares
(a)Votingrights
Subjecttosomelimitedexceptions,eachmemberhastherighttovoteatageneralmeeting.
Onashowofhandsorapoll,eachmemberattendingthemeeting(whethertheyareattendingthemeeting
inpersonorbyattorney,corporaterepresentativeorproxy)hasonevote,regardlessofthenumberofshares
held.However,whereapersonattendsameetinginpersonandisentitledtovoteinmorethanonecapacity
(forexample,thepersonisamemberandhasalsobeenappointedasproxyforanothermember)thatperson
mayonlyexerciseonevoteonashowofhands.Onapoll,thatpersonmayexerciseonevoteasamemberand
onevoteforeachothermemberthatpersonrepresentsasdulyappointedattorney,corporaterepresentativeor
proxy.
Thepurposeofgivingeachmemberonlyonevote,regardlessofthenumberofsharesheld,istoreflectthe
natureofthecompanyasacommunitybasedcompany,byprovidingthatallmembersofthecommunitywho
have contributed to the establishment and ongoing operation of the Community Bank® branch have the same
abilitytoinfluencetheoperationofthecompany.
(b) Dividends
Generally,dividendsarepayabletomembersinproportiontotheamountofthesharecapitalpaiduponthe
sharesheldbythem,subjecttoanyspecialrightsandrestrictionsforthetimebeingattachingtoshares.The
franchiseagreementwithBendigoandAdelaideBankLimitedcontainsalimitonthelevelofprofitsorfunds
thatmaybedistributedtoshareholders.Thereisalsoarestrictiononthepaymentofdividendstocertain
shareholdersiftheyhaveaprohibitedshareholdinginterest(seebelow).
(c) Transfer
Generally,ordinarysharesarefreelytransferable.However,thedirectorshaveadiscretiontorefusetoregister
atransferofshares.
Subjecttotheforegoing,shareholdersmaytransfersharesbyapropertransfereffectedinaccordancewiththe
company’sconstitutionandtheCorporationsAct2001.
Prohibitedshareholdinginterest
Apersonmustnothaveaprohibitedshareholdinginterestinthecompany.
Insummary,apersonhasaprohibitedshareholdinginterestifanyofthefollowingapplies:
• Theycontrolorown10%ormoreofthesharesinthecompany(the“10%limit”).
• Intheopinionoftheboardtheydonothaveacloseconnectiontothecommunityorcommunitiesinwhichthe
companypredominantlycarriesonbusiness(the“closeconnectiontest”).
• Wherethepersonisashareholder,afterthetransferofsharesinthecompanytothatpersonthenumberof
shareholdersinthecompanyis(orwouldbe)lowerthanthebasenumber(the“basenumbertest”).Thebase
numberis298.Asatthedateofthisreport,thecompanyhad325shareholders.
Aswithvotingrights,thepurposeofthisprohibitedshareholdingprovisionistoreflectthecommunity-basednature
ofthecompany.
Whereapersonhasaprohibitedshareholdinginterest,thevotinganddividendrightsattachingtothesharesin
whichtheperson(andhisorherassociates)haveaprohibitedshareholdinginterest,aresuspended.
Annual report Inglewood & Districts Community Enterprises Limited 31
Notestothefinancialstatements(continued)
Note13.Contributedequity(continued)
Prohibitedshareholdinginterest(continued)
Theboardhasthepowertorequestinformationfromapersonwhohas(orissuspectedbytheboardofhaving)
alegalorbeneficialinterestinanysharesinthecompanyoranyvotingpowerinthecompany,forthepurposeof
determiningwhetherapersonhasaprohibitedshareholdinginterest.Iftheboardbecomesawarethatamember
hasaprohibitedshareholdinginterest,itmustserveanoticerequiringthemember(orthemember’sassociate)to
disposeofthenumberofsharestheboardconsidersnecessarytoremedythebreach.Ifapersonfailstocomply
withsuchanoticewithinaspecifiedperiod(thatmustbebetweenthreeandsixmonths),theboardisauthorised
tosellthespecifiedsharesonbehalfofthatperson.Theholderwillbeentitledtotheconsiderationfromthesale
oftheshares,lessanyexpensesincurredbytheboardinsellingorotherwisedealingwiththoseshares.
TheNationalStockExchange(NSX)hasadvisedthatinitsviewtheprohibitedshareholdingprovisionsare
appropriateandequitablebutthe‘basenumbertest’isnot,asaresultthebasenumberclausedoesnotoperate
whilstthecompanyremainslistedontheNSX.
Intheconstitution,membersacknowledgeandrecognisethattheexerciseofthepowersgiventotheboardmay
causeconsiderabledisadvantagetoindividualmembers,butthatsucharesultmaybenecessarytoenforcethe
prohibition.
2014 2013 $ $
Note14.RetainedearningsBalanceatthebeginningofthefinancialyear 22,930 (15,059)
Netprofitfromordinaryactivitiesafterincometax 13,274 37,989
Dividendspaidorprovidedfor (30,325) -
Balance at the end of the financial year 5,879 22,930
Note15.StatementofcashflowsReconciliationofprofitfromordinaryactivitiesaftertaxtonetcashprovided
by operating activities
Profitfromordinaryactivitiesafterincometax 13,274 37,989
Noncashitems:
-depreciation 10,049 8,679
-amortisation 13,865 13,865
Changes in assets and liabilities:
-decreaseinreceivables 3,710 2,704
-(increase)/decreaseinotherassets 80 (224)
-increaseinpayables 2,052 1,836
-decreaseinprovisions - (30,325)
-decreaseincurrenttaxliabilities (8,324) (18,296)
Net cash flows provided by operating activities 34,706 16,228
Annual report Inglewood & Districts Community Enterprises Limited32
Notestothefinancialstatements(continued)
Note16.LeasesOperating lease commitments
Non-cancellableoperatingleasescontractedforbutnotcapitalisedinthe
financialstatements
Payable-minimumleasepayments:
-notlaterthan12months 12,000 12,000
-between12monthsand5years 35,000 35,000
-5yearsplus - -
47,000 47,000
ThepropertyleaseislinkedtotheCompany’sFranchiseAgreementwithBendigo&AdelaideBankLimited,the
Franchiserenewalwason1June2012withtwo,5yearextensionoptionsavailable.Asatreportingdatethenew
leaseagreementhadnotbeenfinalisedandisinthehandsoflegalrepresentatives.Thereisnoindicationto
suggestitwillnotberenewed.
2014 2013 $ $
Note17.Auditor’sremunerationAmounts received or due and receivable by the auditor of the company for:
-auditandreviewservices 4,950 4,900
-shareregistryservices 2,719 3,998
-nonauditservices 2,447 1,130
10,116 10,028
Note18.Dividendspaidorprovideda. Dividends paid during the year
Current year dividend
100% (2013: 100%) franked dividend - 6 cents (2013: 6 cents) per share 30,325 -
2014 2013 $ $
Annual report Inglewood & Districts Community Enterprises Limited 33
Notestothefinancialstatements(continued)
Note18.Dividendspaidorprovided(continued)
b. Franking account balance
Frankingcreditsavailableforsubsequentreportingperiodsare:
- frankingaccountbalanceasattheendofthefinancialyear 31,714 30,803
- frankingcreditsthatwillarisefrompaymentofincometaxpayable
asattheendofthefinancialyear (7,184) (1,140)
- frankingdebitsthatwillarisefromthepaymentofdividendsrecognised
asaliabilityattheendofthefinancialyear - -
Franking credits available for future financial reporting periods: 24,530 29,663
Net franking credits available 24,530 29,663
Note19.Earningspershare
2014 $
2013 $
(a) Profitattributabletotheordinaryequityholdersofthecompanyused
in calculating earnings per share13,274 37,989
Number Number
(b) Weightedaveragenumberofordinarysharesusedasthedenominator
in calculating basic earnings per share505,412 505,412
Note20.EventsoccurringafterthereportingdateInglewood & Districts Board of Directors have decided that it would be in the companies best interests to
delistitselffromtheNationalStockExchange(NSX).Theboardhasputforwardamotiontobepassedbythe
shareholdersofthecompanyattheAnnualGeneralMeetingonthe28thofOctober2014.Inglewood&Districts
areawareifthemotioniscarriedthereisanexpectedwaitofthreemonthsbeforetheprocessisfinalised.
Note21.ContingentliabilitiesandcontingentassetsTherewerenocontingentliabilitiesorcontingentassetsatthedateofthisreporttoaffectthefinancial
statements.
Note22.SegmentreportingThe economic entity operates in the service sector where it facilitates Community Bank® services in Inglewood
andthesurroundingdistricts,VictoriapursuanttoafranchiseagreementwithBendigoandAdelaideBankLimited.
2014 2013 $ $
Annual report Inglewood & Districts Community Enterprises Limited34
Notestothefinancialstatements(continued)
Note23.Registeredoffice/PrincipalplaceofbusinessTheentityisacompanylimitedbyshares,incorporatedanddomiciledinAustralia.Theregisteredofficeand
principal place of business is:
Registered Office Principal Place of Business
64BrookeStreet
InglewoodVIC3517
64BrookeStreet
InglewoodVIC3517
Note24.Financialinstruments
Financial Instrument Composition and Maturity Analysis
Thetablebelowreflectstheundiscountedcontractualsettlementtermsforallfinancialinstruments,aswellasthe
settlementperiodforinstrumentswithafixedperiodofmaturityandinterestrate.
Financial instrument
Floating interestFixed interest rate maturing in Non interest
bearingWeighted average1 year or less Over 1 to 5 years Over 5 years
2014$
2013$
2014$
2013$
2014$
2013$
2014$
2013$
2014$
2013$
2014%
2013%
Financial assets
Cash and cash equivalents
11,471 20,155 200,000 200,000 - - - - 100 100 3.10 4.27
Receivables - - - - - - - - 39,265 40,009 N/A N/A
Financial liabilities
Payables - - - - - - - - 3,337 1,100 N/A N/A
NetFairValues
Thenetfairvaluesoffinancialassetsandliabilitiesapproximatethecarryingvaluesasdisclosedinthebalance
sheet.Thecompanydoesnothaveanyunrecognisedfinancialinstrumentsattheyearend.
CreditRisk
Themaximumexposuretocreditriskatbalancedatetorecognisedfinancialassetsisthecarryingamountof
thoseassetsasdisclosedinthebalancesheetandnotestothefinancialstatements.
Therearenomaterialcreditriskexposurestoanysingledebtororgroupofdebtorsunderfinancialinstruments
enteredintobytheeconomicentity.
InterestRateRisk
Interestrateriskreferstotheriskthatthevalueofafinancialinstrumentorcashflowsassociatedwiththe
instrumentwillfluctuateduetochangesinmarketinterestrates.Interestrateriskarisesfromtheinterestbearing
financialassetsandliabilitiesinplacesubjecttovariableinterestrates,asoutlinedabove.
Annual report Inglewood & Districts Community Enterprises Limited 35
Notestothefinancialstatements(continued)
Note24.Financialinstruments (continued)
SensitivityAnalysis
Thecompanyhasperformedsensitivityanalysisrelatingtoitsexposuretointerestrateriskatbalancedate.
Thissensitivityanalysisdemonstratestheeffectonthecurrentyearresultsandequitywhichcouldresultfroma
changeininterestrates.
Asat30June2014,theeffectonprofitandequityasaresultofchangesininterestrate,withallothervariables
remaining constant would be as follows:
2014 $
2013 $
Changeinprofit/(loss)
Increaseininterestrateby1% 115 202
Decreaseininterestrateby1% 115 202
Changeinequity
Increaseininterestrateby1% 115 202
Decreaseininterestrateby1% 115 202
Annual report Inglewood & Districts Community Enterprises Limited36
Directors’ declarationInaccordancewitharesolutionofthedirectorsofInglewood&DistrictsCommunityEnterprisesLimited,westate
that:
In the opinion of the directors:
(a) thefinancialstatementsandnotesofthecompanyareinaccordancewiththeCorporationsAct2001,
including:
(i) givingatrueandfairviewofthecompany’sfinancialpositionasat30June2014andofitsperformance
forthefinancialyearendedonthatdate;and
(ii) complyingwithAccountingStandards,theCorporationsRegulations2001andothermandatoryprofessional
reportingrequirements;and
(b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they
becomedueandpayable.
(c) the audited remuneration disclosures set out in the remuneration report section of the directors’ report comply
withAccountingStandardAASB124RelatedPartyDisclosuresandtheCorporationsRegulations2001.
Thisdeclarationismadeinaccordancewitharesolutionoftheboardofdirectors.
Maxwell Charles Higgs,
Chairman
Signedonthe25thofAugust2014.
Annual report Inglewood & Districts Community Enterprises Limited 37
Independent audit report
Annual report Inglewood & Districts Community Enterprises Limited38
Independent audit report (continued)
Annual report Inglewood & Districts Community Enterprises Limited 39
Inglewood&DistrictsCommunityEnterprisesLimitedisapubliccompanyincorporatedinAustraliaandlistedon
theNationalStockExchangeofAustralia(NSX).
Shareholding
Thefollowingtableshowsthenumberofshareholders,brokenintovariouscategoriesshowingthetotalnumberof
sharesheld.
Number of shares heldNumber of
shareholdersNumber ofshares held
1to1,000 229 145510
1,001to5,000 90 299402
5,001to10,000 6 60500
10,001to100,000 0 0
100,001andover 0 0
Total shareholders 325 505,412
Equity securities
Eachoftheaboveshareholdersareentitledto1vote,irrespectiveofthenumberofsharesheld.
Therearenosubstantialshareholders(holdingmorethan5%ofvotingrights)aseachshareholderisentitledto1
vote.Normallyholdingmorethan5%oftotalissuedshareswouldcreateasubstantialshareholder,butthisisnot
applicableduetothevotingrestrictionsforthecompany.
Thereare27shareholdersholdinglessthanamarketableparcelofshares($500invalue).
Therearenorestrictedsecuritiesonissue.
Allsharesonissueareordinarysharesfullypaidto$1pershare.Therearenounquotedequitysecurities.
Largest shareholders
Thefollowingtableshowsthelargestshareholdersincludingequalholdings.
ShareholderNumber of fully
paid shares heldPercentage of issued capital
BarryRobertParker 15000 2.97
MrsHeatherDenyseAppleby 12000 2.37
FpNevins&CoPtyLtd 10000 1.98
MichaelBrianFitzgerald 10000 1.98
NorthernSuburbsSecretarialServicesP/L<JuletonA/C> 7500 1.48
InglewoodAndDistrictsHealthServiceInc 6000 1.19
MrGarryIanAppleby 5000 0.99
MrNeilAlexanderAppleby 5000 0.99
MrKennethGordonAppleby 5000 0.99
MrArnoldEvertLook 5000 0.99
NSXreport
Annual report Inglewood & Districts Community Enterprises Limited40
Security register
Thesecurityregister(shareregister)iskeptat:
61-65BullStreet
BendigoVIC3550
Phone:(03)54430344
Company Secretary
KimHanlonhasbeentheCompanySecretaryofInglewood&DistrictsCommunityEnterprisesLimitedsince
November2013.Kim’squalificationsandexperienceincludeextensiveexperienceinofficeadministration,
bookkeepingandaDiplomaofBusinessManagement.
Corporate governance
Thecompanyhasimplementedvariouscorporategovernancepractices,whichinclude:
(a) Theestablishmentofanauditcommittee.MembersoftheauditcommitteeareMaxHiggs,KenCanfieldand
KimHanlon;
(b) Director approval of operating budgets and monitoring of progress against these budgets;
(c) Ongoing Director training; and
(d)MonthlyDirectormeetingstodiscussperformanceandstrategicplans.
Annexure 3
There are no material differences between the information in the company’s Annexure 3 and the information in the
financialdocumentsinitsAnnualReport.
5 Year summary of performance
2010 2011 2012 2013 2014
Grossrevenue $ 581,889 675,861 735,390 802,740 819,229
Netprofitbeforetax $ 57,176 81,036 61,401 54,356 18,876
Total assets $ 472,610 519,222 528,242 519,222 495,979
Total liabilities $ 37,600 57,482 54,785 7,776 1,584
Totalequity $ 435,010 461,740 473,457 511,446 494,395
NSXreport(continued)
bendigobank.com.au
Inglewood & Districts Community Bank® Branch 64 Brooke Street, Inglewood VIC 3517Phone: (03) 5438 3500 Fax: (03) 5438 3502
Franchisee: Inglewood & Districts Community Enterprises Limited64 Brooke Street, Inglewood VIC 3517ABN: 87 123 959 375www.bendigobank.com.au/inglewood
Share Registry: AFS & Associates Pty Ltd61-65 Bull Street, Bendigo VIC 3550PO Box 454, Bendigo VIC 3552Phone: (03) 5443 0344 Fax: (03) 5443 5304Email: [email protected] (BMPAR14040) (08/14)