Annual Review 2015–16 - Property NSW · 2016-12-01 · Property NSW Annual Review 2015–16 Dear...

Excellence in property and places for NSW

Annual Review

2015–16

GovernmentProperty NSW

Annual Reports

Property NSW Annual Review 2015–16

Dear Minister

Letter of submission

I am pleased to submit to you, for presentation to Parliament, an Annual Review of the activities of Property NSW for the period 1 July 2015 to 30 June 2016.

Additionally, in accordance with the Annual Report (Statutory Bodies) Act 1984, I submit the Annual Reports and financial affairs of Government Property NSW, Sydney Harbour Foreshore Authority and NSW Teacher Housing Authority for the same period.

Brett NewmanDeputy SecretaryProperty NSW

Martin HoffmanSecretaryDepartment of Finance, Services and Innovation


Property NSW Annual Review

02 Foreword from our Deputy Secretary

04 Our role 05 Our organisation

06 Our work • The Sandstones • Gosford revitalisation • Millers Point • Integrated outsourced

asset management • Relocations to

Western Sydney • Flexible teacher

accommodation • The Goods Line

14 Our services and divisions

20 Our people

23 Our performance

24 Performance overview • Commercial • Retail • Waste • Housing • Financial

30 Environment and sustainability

Appendices

37 Appendix A Government Property NSW

• Financial statements• Statutory information

91 Appendix B Sydney Harbour

Foreshore Authority • Financial statements

and statutory information: Sydney Harbour Foreshore Authority

• Financial statements: Luna Park Reserve Trust

183 Appendix C Teacher Housing

Authority of NSW• Financial statements• Statutory

information

246 Index

Contents

www.property.nsw.gov.au

Front cover: Colonial Secretary’s building, Macquarie Street, Sydney. This page: The Goods Line, Darling Harbour © Florian Groehn.

Under clause 6 of Schedule 5 of the Waste Recycling and Processing Corporation (Authorised Transaction) Act 2010, the Treasurer has designated that Waste Assets Management Corporation’s Annual Report be included with the Department of Finance, Service and Innovation’s Annual Report.


02Property NSW is the new brand name encompassing the entities of Government Property NSW (GPNSW), Sydney Harbour Foreshore Authority (SHFA), Teacher Housing Authority of NSW (THA) and Waste Assets Management Corporation (WAMC). This rebranding is symbolic of the evolution of GPNSW, which now encompasses a wider range of functions, including place making expertise as a result of the consolidation of SHFA functions, and the subsequent integration of NSW Public Works Facilities Management and Valuation Services, formerly part of Land and Property Information (LPI).

This evolution has enabled the coming together of tremendous skills and expertise, which build Property NSW’s capability as a property and place making specialist. This past year has seen us deliver an array of major projects and transactions as well as drive tourism and economic development. This has been possible with our extensive experience across the property sector and heritage, enabling us to provide end-to-end solutions for property portfolios and places.

It has been a source of great pride that our group has managed to further its role as NSW Government’s trusted advisor when it comes to driving reform and delivering commercial and community best practice outcomes.

Property NSW owns and manages $3 billion worth of assets across 1,800 sites, as well as managing over 1,300 leases for NSW Government agencies.

Property NSW has delivered significant results in 2015/16. Highlights include:

• Asset recycling – our Commercial Transactions and Major Projects teams delivered 130 transactions worth $431.5 million, funding that will support the delivery of better infrastructure and services. These included the sale of land at Stanhope Gardens for $31 million and a further 13 surplus properties for $32.8 million for the Department of Education.

• Pipeline of projects – we have a pipeline of $2.3 billion worth of possible transactions over the financial years 2017–21. This is an estimate of the assets that we are currently reviewing and assessing in consultation with government agencies, including State Owned Corporations and Public Trading Enterprises, which may be considered for sale, redevelopment improvement or continued occupation by government.

• Millers Point – our sales program has delivered $210 million to fund new social housing dwellings across New South Wales. With a total of 72 Millers Point properties sold this year, close to 600 new fit-for-purpose social housing dwellings have been funded to date.

• Gosford revitalisation – delivering a plan to develop a vacant site at 32 Mann Street, Gosford, to support the government’s Decade of Decentralisation (DoD) policy and to enable the relocation of over 300 Department of Finance, Services and Innovation (DFSI) roles – contributing to the revitalisation of Gosford’s economy.

• Decade of Decentralisation – we have continued to play a substantial role in relocating public service jobs from the Sydney CBD to metropolitan and regional centres, in particular Western Sydney. We have already delivered a reduction of over 35,100m2 of government Sydney CBD office space, against a target of 100,000m2 by 2021, and have relocated more than 2,300 jobs out of the CBD, with around 1,300 of

Foreword from our Deputy SecretaryOn behalf of Property NSW, I’m delighted to report on our progress over the past 12 months, a period of significant progress for our agency.


03

those relocated to Western Sydney. We are currently undertaking a leasing market search for up to 55,000m2 of office accommodation in Western Sydney to accommodate a number of government agencies from 2019.

• The Sandstones – we continue

to support the adaptive reuse of heritage assets. Achievements this year include the sale, via long-term lease, of the Lands and Education buildings on Bridge Street, Sydney, to Pontiac Land Group, for redevelopment as a luxury boutique hotel, including their commitment to undertake an estimated $300 million of works.

• Property and facilities management – we awarded an integrated outsourced property asset management contract to Jones Lang LaSalle. This new contract will enable government to save close to $12 million over the contract’s five year term by leveraging global best practice property service experience.

• Place management – we established a dedicated Place Management division, which will become the model for other jurisdictions across the state. Visitation to Darling Harbour remains steady, despite major redevelopment within the precinct, on the back of a strong program of events and activations which have contributed to tourism and spend in the precinct. In The Rocks, major events like the Aroma Festival attracted more than 100,000 people to the iconic precinct.

• Property Portfolio Reporting (PPR) – we developed an innovative online portfolio management portal, improving the way our government clients manage their assets. PPR enables agencies to access real-time key metrics for their Property NSW managed property portfolio, resulting in improved decision-making.

We have made significant progress over the past 12 months, and our enhanced range of services are well placed to drive development and reform.

We recently developed a simplified vision for our organisation: excellence in property and places for NSW.

Our success is directly linked to the support we receive from our key stakeholders, and I’d like to thank them for their contribution during a year of transition for our agency.

Finally, I’d like to acknowledge the commitment of our people. I’d like to commend them for their resilience over the past 12 months, and for their commitment in helping our agency achieve our vision.

It is with pleasure that I present our 2015/16 Annual Review and Annual Reports, and I look forward to delivering our strategic objectives and capitalising on new opportunities over the coming year.

Brett NewmanDeputy SecretaryProperty NSW

Internal presentation from Deputy Secretary, Brett Newman


Property NSW operates under the following principal legislation: • Government Property NSW Act 2006 • Sydney Harbour Foreshore Authority

Act 1998• Teacher Housing Authority Act 1975• Waste Recycling and Processing

Corporation (Authorised Transaction) Act 2010.

Property NSW manages the NSW Government’s significant property portfolio and its places. Our focus is on the strategic review, acquisition, divestment and greater utilisation of the government’s real property assets and precincts, which results in better visitor experiences and services for the people of NSW.

Our assets comprise office buildings, significant heritage properties, non-commercial assets and land holdings, and many have been vested in Property NSW by other government agencies.

Our organisation works closely with a range of government agencies, providing specialist industry knowledge, expertise and understanding of the unique requirements of government property management.

Our approach to management of government property generates whole-of-government savings, economic benefits, and sustainability.

Our role

04


05

This year has been one of significant change, with a complex restructure that saw the consolidation of SHFA under Property NSW, along with GPNSW, THA and WAMC.

After balance dateFrom 1 July 2016, Valuation Services, Public Works Facilities Management and Public Works Advisory joined Property NSW to form the Property and Advisory Group, which reports to DFSI.

Operationally, the Property and Advisory Group is managed by a Deputy Secretary who reports to the Minister, both directly and via the Secretary of DFSI.

As statutory bodies representing the Crown, the entities that are under Property NSW have the status, privileges and immunities of the Crown and are under the control and direction of the Minister for Finance, Services and Property.

Under the Government Property NSW Act 2006, GPNSW is also required to report to the Treasurer on matters relating to the properties of government agencies, including advice on their efficient utilisation and relevant budgetary measures.

The organisation chart below is as at submission date.

Our organisation

Structure as at submission date

Minister for Finance, Services and Property(Portfolio Minister)

Department of Finance, Services and Innovation

Property and Advisory Group

Property NSWPublic Works

Advisory

Po

rtfo

lio

Man

agem

ent

Gro

up

Co

mm

erci

al

Tran

sact

ions

Leas

ing

Maj

or

Pro

ject

s

Str

ateg

y

Pla

ce

Man

agem

ent

Valu

atio

n S

ervi

ces

Her

itag

e A

sset

A

dvi

sory

Op

erat

iona

l an

d H

ous

ing

S

ervi

ces

Reg

iona

l and

R

ural

Pro

per

ty

Fin

anci

al

Ser

vice

s

Wat

er

So

lutio

ns


Property NSW’s work encompasses a range of property and place making skills and expertise, enabling the success of projects that meet government objectives. Case studies of our work highlight our dedication to excellence in property and places.

Our work

Department of Lands building, Bridge Street, Sydney

06


7

In 2015/16, the NSW Government announced the sale, via a long-term lease, of The Lands and Education buildings, collectively known as ‘The Sandstones’.

Located at 22–39 Bridge Street, Sydney, these elegant, grandiose heritage buildings tell a unique and interesting story about the history of the early NSW colony. In their current state, the Sandstones are underutilised by the government and not readily accessible to the public. The buildings are State Heritage listed and benefit from the highest level of statutory heritage protection possible in NSW.

To contribute to the NSW Government’s 2020 tourism policy targets and to open the assets to the public, future use of the buildings was restricted to adaptive reuse as luxury boutique hotels. To ensure an optimal outcome, the government approved divestment via a long-term lease. This allows Property NSW to retain custodianship and ensure heritage controls are adhered to, while permitting the adaptive reuse as hotels.

Property NSW, using its heritage, planning, procurement, and stakeholder management expertise, managed the due diligence and divestment process. The due diligence process involved applying for and obtaining Stage 1 development consent and endorsement of the Conservation Management Plans by the NSW Heritage Council.

The divestment process concluded in September 2015 with Pontiac Land Group, a reputable Singaporean developer and hotel operator with extensive experience in sympathetic heritage asset adaptive reuse projects, announced as the successful proponent. The $35 million purchase price included a commitment to undertake an estimated $300 million of works. The redevelopment is forecast to generate economic benefits for the state of $185 million over 20 years.

Property NSW’s role on this exciting project will continue as it monitors delivery of the project through to the opening of the hotel in 2021.

The Sandstones

Department of Education building, Bridge Street, Sydney


08

The project aligns with the NSW Government’s Draft Central Coast Regional Plan, plans for revitalising the Gosford waterfront precinct, and the Decade of Decentralisation policy, ensuring regions across NSW play a greater role in the economic future of our State.

The long-term vision for the remainder of the Mann Street site is outlined in an indicative site concept study and includes a mix of development opportunities including restaurants, car parking and boutique residential short-term accommodation, together with generous public open space.

Property NSW will seek Expressions of Interest to secure an experienced and capable development partner to develop the A-grade, six storey mixed use commercial building and purchase the vacant land for development so it delivers a vibrant and active area connecting Gosford CBD to the waterfront.

Subject to approval of the development application and securing a development partner, it is expected that construction of the commercial building will commence in early 2017 and take around 18 months to complete.

Gosford revitalisationIn 2015/16, the NSW Government endorsed the relocation of over 300 DFSI jobs to Gosford. Property NSW has delivered a plan to develop 32 Mann Street, which will contribute to the revitalisation of Gosford’s economy and reinforce the city’s importance as the regional capital of the Central Coast.

In April 2016, Property NSW lodged a development application for a six storey, 7,000 square metre mixed use commercial building. A key aim of the development application is to accommodate the relocation of more than 300 government jobs to Gosford.

The development of 32 Mann Street has the potential to act as a catalyst to create ongoing economic and employment opportunities for the Central Coast. The development will create 90 direct construction jobs, 30 new jobs in the planning and design stages, and in excess of 330 ongoing indirect jobs. The project is also forecast to deliver $1.4 million per annum in additional retail expenditure to the Gosford CBD and $4.2 million per annum in additional retail expenditure to the Central Coast.

Artist impression of proposed Mann Street development


Property NSW is managing the sale of over 290 government owned properties in Millers Point, with proceeds reinvested into social housing. The sales program is part of the NSW Government’s initiative to sell government-owned heritage housing that is no longer fit-for-purpose, and reinvest the proceeds into the supply of over 1,500 new social housing dwellings across Sydney and regional NSW.

In 2015/16, a total of 72 properties were sold, generating gross sales proceeds of more than $210 million. For every property sold, up to five modern social housing dwellings can be built, contributing to the reduction of the social housing waiting list. Close to 600 new fit-for-purpose dwellings have been funded to date.

At the commencement of the divestment program, the Department of Family and Community Services (FaCS) owned 293 former social housing properties in Millers Point and The Rocks. Most of the properties had been owned by the Government for over 100 years, with 214 heritage listed. Importantly, all heritage listed properties are sold with a Conservation Management Plan endorsed by the NSW Heritage Council.

Property NSW developed the ‘Rediscover Millers Point’ brand and marketed sales through the website www.rediscovermillerspoint.com.au.

Consistent branding and messaging has increased market exposure and awareness of the Millers Point precinct. Exclusive agents were appointed to manage large tranches of property sales, delivering economies of scale for the Government and ensuring better oversight of buyer preferences and interest. These measures have assisted to reduce selling costs, maximising the return for social housing reinvestment.

The Millers Point sales program will continue throughout the next financial year, with plans to sell the remaining apartments, group properties and terraces, using a combination of expression of interest and auction programs.

Millers Point


10

The new contract enables the government to save $11.9 million over its term, and delivers a robust performance management framework with a strong focus on service excellence. JLL’s global property expertise will also enable Property NSW’s government clients to leverage best practice processes and systems, further improving office accommodation efficiency and delivering additional savings.

Property NSW will continue to provide strategic asset management and advisory services and, with the backing of JLL’s 24-hour help desk facility, deliver improved customer relationship management.

Improved technology platforms, such as an online information portal and reporting system, will provide our clients with up-to-date information on occupancy and utilisation costs, enabling improved budgeting and forward planning. Property NSW will have greater control over the management of the government’s capital maintenance program by improving the tracking, performance and delivery of more efficient operations.

The new contract arrangement commences in the first quarter of 2016/17. A program of continuous improvement and innovation will drive further efficiencies and savings over the next five years, with exceptional customer service being a primary target.

Property NSW’s new integrated outsourced asset management contract with Jones Lang LaSalle (JLL) will enable government savings of close to $12 million over its five year term.

After a rigorous tender process, JLL was awarded a new integrated outsourced property asset management contract in April 2016.

Leveraging off their global best practice specialist experience in property services, JLL’s five year contract includes a 24/7 help desk facility, property management, facilities management, minor works, project management, and research/benchmarking services.

This approach aligns with the Property Asset Utilisation Taskforce (PAUT) principle of reducing duplication, by outsourcing services by delivering an integrated property asset management framework.

Integrated outsourced asset management

Penrith Government Office Building


11Working in consultation with the Department of Education, Property NSW delivered a complex pre-commitment transaction to develop improved office accommodation in Western Sydney.

The NSW Government’s Decade of Decentralisation policy aims to relocate public sector jobs from the Sydney CBD and Greater Sydney area to metropolitan and regional locations, with a particular focus on Western Sydney. The government’s objective is to stimulate economic growth and long term job generation.

In November 2015, the government approved the relocation of the Department of Education (DoE) from its existing CBD office tenancies (c. 35,000m2) to a new consolidated site in Parramatta (25,000m2). This will be implemented in two stages, with an estimated 650 jobs moving to Parramatta in 2018 and a further estimated 1,170 jobs moving in 2020.

Property NSW has secured a commitment for the DoE to be accommodated in new premises to be constructed by Dexus at 105 Phillip Street, Parramatta.

Property NSW provided its expertise and advice on the commercial aspects of the proposal, managing an open market Expression of Interest process and negotiating and securing the financial and commercial terms for the agreement for lease and lease documentation. This highly complex pre-commitment transaction will deliver a high-standard of accommodation with particular emphasis on environmental credentials and staff amenity. It will also deliver improved utilisation due to the reduction of the DoE’s current accommodation footprint by 10,000 square metres.

Relocations to Western Sydney

Artist impression of 105 Phillip Street,

Parramatta


12

Flexible teacher accommodationTeacher Housing Authority of NSW (THA) has designed flexible accommodation to support the needs of teachers and their families in remote and rural communities.

In June 2016, THA officially opened a $1.25 million accommodation complex, providing more housing for teachers at Coonamble’s schools. The new eight unit accommodation complex on Gordon Street has the flexibility to be converted into four two-bedroom units, or two three-bedroom units and one single-bedroom unit.

Coonamble, nearly 600 kilometres north-west of Sydney, has a population of close to 3,000. Its two schools cater for nearly 500 students, and THA provides 33 residences for teachers across both schools.

The new housing is part of an ongoing commitment by the NSW Government to attract and retain teachers in rural and regional areas across the state.

Similar projects were completed during the year, with a $1.06 million development in Wilcannia (four units) and a $2.25 million development in Brewarrina (eight units).

Flexible accommodation meets the needs of families, couples and singles, as well as providing improved asset utilisation. THA will deliver similar projects to rural and remote communities in the future.

Coonamble teacher accommodation


13

Property NSW developed and manages The Goods Line (TGL), a green public space that provides a traffic-free, accessible thoroughfare from Central Station to Darling Harbour.

TGL connects Ultimo and Darling Harbour with Central Station and the CBD.

Opened in August 2015, TGL is surrounded by some of Sydney’s most important cultural, educational and media institutions, including the ABC, UTS, TAFE and the Museum of Applied Arts and Sciences (Powerhouse).

TGL creates a new open space for recreation and study, connecting more than 80,000 tertiary students, locals and visitors to the many major attractions in Darling Harbour.

TGL is also a new public space for pop-up events, bringing new activity into the precinct. Property NSW attracts more than 26 million people to Darling Harbour each year, and TGL adds to the social fabric by making it easier for nearby students, workers and residents to enjoy the entertainment and retail facilities on offer in the precinct.

TGL has been compared to New York’s famous High Line, reclaiming a disused rail corridor – including a heritage rail bridge over Ultimo Road – and returning it to public use as a vibrant, elevated pedestrian walkway and cycle path.

Property NSW worked closely with the University of Technology, Sydney, Sydney Trains and neighbouring stakeholders to deliver the project.

TGL has received many accolades for urban and green design, including the 2016 AILA NSW Awards Civic Landscape Award of Excellence and the 202020 Vision Green Design Award 2016. It is currently nominated in the Landscape category of the World Architecture Festival and the Rosa Barba International Landscape Prize.

The Goods Line

The Goods Line © Florian Groehn


14

Property NSW’s services and divisions complement the organisation’s objectives.

Our services and divisions

Property NSW delivers property solutions and great places for the people of NSW.

Property NSW is focused on excellence in property and places. We deliver continuous improvement and innovation. Our approach is to collaborate with stakeholders to deliver government objectives for the community. We manage the state’s significant property portfolio and its places, which results in better visitor experiences and services for the people of NSW.

Our services include:• leading property reform• active portfolio and asset

management• delivering transactions and major

projects• place making and heritage

conservation, and• valuation services.

Our service delivery is underpinned by strong Key Performance Indicators, described in Our KPIs, and supported by divisions that work closely with our government clients to drive commercial best practice outcomes for the benefit of the NSW community.

Major ProjectsOur Major Projects team is responsible for the strategic evaluation, management and delivery of large scale or complex real estate projects, including acquisitions and divestments, on behalf of the NSW Government.

In executing its role, the team focuses on whole-of-government engagement and outcomes. Its services include adaptive re-use and best-use site analysis, real estate advisory, acquisition and divestment management, and development management – such as project design, feasibility assessment, rezoning, pre-leasing and project management.

Examples of Major Projects’ work include:

• Heritage precinct management – strategic review of NSW Government’s Macquarie Street colonial heritage precinct, with a view to improving public access and connectivity, and the adaptive reuse of heritage buildings.

• Site value enhancement – execution of master planning, rezoning and development delivery strategies for significant infill sites in Rydalmere and Hurlstone to return optimum divestment value to government.

14


15

15

• Real estate advisory – providing advice on best-use options for government owned sites, including the Powerhouse Museum, Ultimo, and the Chief Secretary’s Building.

• Site adaptive reuse – facilitating the reuse of a portion of Fire and Rescue NSW’s Alexandria Training College for use as the future headquarters of Sydney Train’s Rail Operation Centre.

• Development management – management of high value, complex development projects to achieve government policy objectives such as The Sandstones and Gosford development (see earlier case studies).

Commercial TransactionsOur Commercial Transactions division is responsible for the evaluation, planning and delivery of property acquisitions and disposals on behalf of government agencies across a wide spectrum of projects and portfolios. This team undertakes transactions that benefit from economies of scale (volume or similarity), or exhibit shorter “go to market” timelines, lower individual values or complexity than those undertaken by the Major Projects team.

This team applies strong project management practices to move transactions through various phases, including pre-sale due diligence investigations, feasibility analysis, execution of value add strategies and implementation of marketing and sale strategies.

In addition, this division manages and provides expert and strategic advice to agencies on prospective acquisition and disposal programs and transactions.

This year, the team streamlined processes and demonstrated significant progress in working through Property NSW’s property pipeline. This resulted in the execution of 130 transactions worth $431.5 million, exceeding client and market expectations.

Examples of transactions and projects undertaken by the team include:

• Department of Education – the sale of 5.7 hectares of land at Stanhope Gardens for $31 million and a further 13 surplus properties for $32.8 million.

• 22 Main Street, Blacktown – this office building, partly leased to the NSW Government, was sold for $17.2 million.

• 2 Burley Street, Lane Cove – the sale of vacant land adjoining the Pacific Highway for Roads and Maritime Services for $22.1 million.

• 108 Millers Street, Pyrmont – sale of 1,846m2 of vacant land for Transport for NSW for $22.4 million.

• Millers Point – sale of 72 dwellings for $210 million for NSW Land and Housing Corporation.

Pictured (left to right): Emanuel Varapatis, Fire and

Rescue NSW (FRNSW); Colin Stewart and Mark Jones,

CBRE; Cameron Elsegood, Major Projects; Jonathan

Betts, Leasing; Rosemary Milkins, FRNSW; Leon

Walker, Major Projects; Alex Nedeljkovic, representing

FRNSW; Peter Hurley, Major Projects; and Peter Bolton-

Hall, Major Projects.


16

Portfolio Management GroupThe Portfolio Management Group (PMG) is responsible for the management and maintenance of government owned properties, and for delivering strategic asset management services to government agencies. A number of groups within PMG provide these services.

Asset Management – provides strategic planning, maintenance, revenue forecasting, expense management, and capital expenditure management on more than 200 government owned properties and a further 630 leased properties across the state. The team drives effective lease/lessor management and tenant services for over 1 million square metres of Net Lettable Area (NLA) across the portfolio, with non-commercial assets, such as State-significant, special use assets making up a further 715,000 square metres.

Vesting – provides a range of statutory acquisitions services under the GPNSW Act and the Land Acquisition (Just Terms Compensation) Act 1991 for Property NSW and our clients. This year, eight orders, including a total of 111 land parcels, were transferred from government agencies to Property NSW. The team also manages the acquisition and holding of Certificates of Title under Memorandum of Understanding (MoU) for agencies that do not have the legislative power to deal in real property transactions. In 2015/16, Vesting assisted NSW Police in the acquisition of five properties across the state and worked with DFSI on a project to rectify Certificates of Title owned by the former Public Work’s Minister.

Building and Environmental Services (BES) – delivers facilities management, capital works, environmental and sustainability services and the Customer Service Centre. In 2015/16, BES:

• delivered 62 capital projects, including major heritage works on State-significant assets like the Chief Secretary’s Building in Sydney

• completed more than 18,000 planned facilities maintenance services and provided strategic solutions to reactive operational issues across a portfolio of 830 owned and leased properties

• responded to more than 54,000 requests via the Customer Service Centre and developed a “Priority Critical” process, delivering service efficiencies and minimising the impact on client continuity

• identified environmental and sustainability initiatives, sites where installation of Power Factor Correction (PFC) units would achieve electricity demand savings, opportunities to implement a cloud-based utility bill analysis and payment system that delivers a streamlined process and cost savings for government, and planning for the rollout of Power of Choice (PoC) smart metering on small market sites in the next financial year to increase transparency and accuracy of electricity billing data

• led the tender process to select an outsourced asset management service provider, JLL; the contract model allows tenants to work from a common technology platform, with access to detailed reporting of metrics relating to their portfolios.


17

LeasingOur Leasing division is responsible for devising, negotiating and implementing leasing strategies for over one million square metres of commercial office space across the state.

The team works collaboratively with government agencies to ensure that the leased space occupied by the State’s public sector meets its operational requirements, broader strategic initiatives and delivers best value to government. As specialist leasing advisors, the team has successfully negotiated over 400 lease transactions in the past 12 months.

Key highlights for 2015/16 include:

• securing 25,000m2 of commercial space for the Department of Education in Parramatta, to be delivered by 2020

• securing 5,800m2 of commercial space in Wollongong for NSW State Emergency Service State Headquarters, to be delivered in early 2017

• executing transactions involving 272 separate head leases and licences over 170,500m2 of Net Lettable Area across the State

• securing 6,000m2 in the CBD to house iCare, at the commencement of the State Insurance and Care Governance Act. A further 3,100m2 of space within the same building was also acquired for iCare to operate from while the main tenancy was fitted out.

StrategyOur Strategy division is responsible for the development of whole-of-government strategy for the effective management of the State’s real property portfolio. It also provides market leading, specialist, multi-disciplinary advice on long term portfolio planning, accommodation strategy, policy and collaborative initiatives.

The team is responsible for driving the development, integration and implementation of policies and initiatives to improve management of the asset portfolio across government agencies, and to improve utilisation. Strategy also advises on the operating model and long term capital plan for Property NSW.

Key achievements for the Strategy division in 2015/16 include the development of new policies for the ownership and management of government’s real property portfolio, and the successful transition of SHFA’s functions into Property NSW.


18

Place ManagementProperty NSW is responsible for the ownership and management of NSW’s State-significant precincts, The Rocks and Darling Harbour.

Place Management aims to uphold community, social, heritage and commercial interests by providing world-class places and experiences that attract more than 40 million visitors per year1 to our precincts.

The division’s multi-disciplinary experience extends to asset management, retail and commercial leasing, strategic planning and heritage, as well as events and marketing.

Place Management is responsible for 19 head leases, 32 licences and 63 tenancies throughout Darling Harbour (including berthing licences) and 207 leases, 67 licences and 200 market stall holders in The Rocks.

The division works to ensure the activation and profitability of our precincts for the mutual benefit of tenants, visitors and the taxpayers of NSW. Retail vacancy rates, which are reported by industry on a square metre basis, show that The Rocks is significantly outperforming its neighbour the Sydney CBD.

During 2015/16, Place Management developed a suite of documents, designed to help potential tenants to plan ahead and gather together the information needed to help them secure

a tenancy in The Rocks or Circular Quay, and to keep the leasing process moving as efficiently as possible.

The suite also includes The Rocks’ Strategic Directions and Retail Leasing Directions, allowing existing and potential tenants to explore Property NSW’s vision and responsibilities for its precincts.

Place Management also delivered The Goods Line, the award-winning urban green space linking Central Station to Darling Harbour.

Additionally, the NSW Government has committed to a number of key heritage capital works, including:• $23 million restructure of Pyrmont

Bridge• $15 million construction of Cockle Bay

marine structures• $15 million refurbishment of retail

tenancies in The Rocks.

Place Management will deliver on these initiatives, supported by its heritage and place making expertise.

Valuation ServicesOur Valuation Services division harnesses its government property expertise to provide impartial and transparent valuations of each local government area every three to four years, alongside annual valuations of all NSW properties.

This important information assists local and State governments to determine rates and land taxes.

The Rocks and Darling Harbour precincts


19

Valuation Services also provides other services to government agencies, giving them easy and fast access to the latest valuation data. The integrity of valuation data is paramount, and controls apply to ensure the fairness and thoroughness of the valuation process.

Operational and Housing ServicesOur Operational and Housing Services division is responsible for providing high quality business support and corporate services to Property NSW business units.

The division provides specialist services in information technology, business transformation, communications and marketing, human resource management, legal, risk and compliance management and other general business services. Additionally, with the consolidation of THA into Property NSW, the division provides housing services and solutions for rural and regional teachers across the State.

This year, the division’s Business Transformation team led the cross-business working group to develop and deliver the Property Portfolio Reporting portal for our agency clients, enhancing Property NSW’s digital services offering.

Property Financial ServicesOur Finance team is responsible for measuring and analysing the financial performance of the Property and Advisory Group, as well as administering

the group’s financial transactions and providing financial and administrative support to the group.

This includes the management of all financial data relating to owned real estate, managed leases and all projects undertaken by Property NSW. The team is instrumental in developing and delivering financial forecasts, business and project budgets as well as group-wide asset plans and analysis.

Our Finance team members provide practical advice across financial planning, property accounting, transaction management, project accounting and business analytics.

Public Works AdvisoryPublic Works Advisory (PWA) supports our government clients to deliver infrastructure projects more effectively by providing advice on how to utilise the specialist services of ‘best fit’ providers.

The division provides a bridge between the government and the private sector to ensure the best infrastructure outcomes for the NSW Government.

The team are asset advisory specialists, with a proud history dating back to the first Public Works project in Sydney Cove in 1788. The division’s services include:• procurement and financial infrastructure advisory• analysis of design solutions• domain market advice• engineering emergency management• support to regional government agencies with limited

infrastructure delivery capability• water and environment infrastructure advice• heritage asset management advice and archaeological

services.

PWA joined Property NSW on 1 July 2016 to form the Property and Advisory Group.

Image captured from Property NSW’s online Property

Portfolio Reporting portal


20

The Property and Advisory Group Executive teamIn the past year Property NSW has focused on building teams that live our values – accountability, creativity and teamwork. Although our focus is on property and place making, our teams are made up of diverse skill sets, facilitating a multi-disciplinary approach to problem solving.

As at 30 June 2016, Property NSW employed 368 people, including 177 women and 191 men, with 27 of our people employed on a contract basis, 260 permanent, and the remaining 81 employees either seconded, providing services as consultants or employed on Executive contracts.

Providing equal opportunities for women and men to develop their skills continues to be a focus for Property NSW. Of the 37 leadership roles, 13 are occupied by women and 24 by men.

Property NSW aims to operate at least as efficiently as private enterprise, in line with our values to deliver services that are of the highest quality. Workplace culture is an important part of how Property NSW carries out its business, maintains consistency of performance and ultimately delivers the best results for Government.

On 1 July 2016, Public Works Advisory joined Property NSW to form the Property and Advisory Group.

Our people

BRETT NEWMANDeputy Secretary, Property NSWChief Executive Officer, GPNSW

Brett joined Property NSW as GPNSW’s Chief Executive Officer in April 2013, and is the Deputy Secretary of Property NSW. He leads the NSW Government’s owned and leased property portfolio, which generates revenues in excess of $500m per annum.

Brett is Chair of the Teacher Housing Authority and the Strategic Property Transactions Committee. He is on the Board of Sydney Harbour Foreshore Authority and participates in a number of government wide strategic steering committees.

Prior to leading Property NSW, Brett held a number of senior executive positions with organisations such as Blackstone, Westpac, Stockland, Challenger and Macquarie Bank.

Leadership – our Executive team


21

DENNIS SZABOExecutive Director, Commercial Transactions

Dennis has over 20 years experience in professional services funds management and corporate real estate. Dennis has led our Commercial Transactions team through a period of significant change and success. Dennis joined Property NSW in January 2014 with a background in senior management roles with Westpac and Pricewaterhouse-Coopers.

ADAM HOWARTHExecutive Director, Portfolio Management Group

Adam’s property career includes the management of portfolios for global organisations such as Westpac, Telstra and ANZ, with responsibility for providing integrated transaction, asset and facility management services. His experience extends from property acquisitions and divestment to the development and implementation of strategic property accommodation solutions and the integrated management of property services.

OLGA MASELLAExecutive Director, Leasing

Olga has over 16 years’ experience leading and managing teams of diverse property experts, maximising commercial, financial and community outcomes in the public and private sectors. Olga was appointed to this role in July 2016 after previously occupying the roles of Acting Executive Director and Director, Commercial Transactions within Property NSW.

LEON WALKERExecutive Director, Major Projects

Leon has a strong background as an experienced chief operating officer, fund manager and project financier, having held executive positions with Mirvac and Macquarie Group, domestically and abroad, across industry sectors including property, banking and infrastructure. Leon is experienced in the effective management of business operations and corporate governance processes, the development of high performing teams, management of large business transformation projects, and complex matters.

JENNY BLATCHFORDActing Executive Director, Strategy

Jenny joined Property NSW in 2014. She has a breadth of experience across project management, strategy and stakeholder engagement, most recently leading the development of whole-of-government strategies for Property NSW and managing the implementation of policies and initiatives to improve management of the portfolio. Jenny commenced her career as a banking and finance lawyer, followed by 10 years as an investment banker.

Bill Frith was appointed to this role in October 2016.


22

JENNIFER PALMERExecutive Director, Operational and Housing Services

Jennifer has a wealth of experience in managing and leading through change, having been involved in the decommissioning of Service First and the transformation initiatives for State Fleet and State Records. She has diverse public sector experience, including roles at the NSW Health Department and the NSW Attorney General’s Department. Jennifer commenced at Property NSW as Executive Director, Operational and Housing Services in July 2016.

ANNA WELANYKExecutive Director, Valuation Services

Anna has extensive global experience leading teams in the planning and delivery of integrated real estate services including various executive level positions with CBRE, London. Since joining Property NSW in February 2014 as Executive Director, Portfolio Management Group, Anna delivered a raft of improvement initiatives including the development of a new service delivery solution for the management of the Government’s assets, saving taxpayers in excess of $11 million over five years. Anna was appointed Executive Director, Valuation Services, commencing July 2016.

SAM ROMANIUKExecutive Director, Place Management

Sam has more than 20 years’ experience in strategy, portfolio management, corporate development and direct property investment. He leads the Place Management division, responsible for managing State significant precincts including The Rocks and Darling Harbour, while balancing visitor, community and commercial expectations. Prior to this role, Sam occupied the position of Executive Director, Strategy, and before joining Property NSW in August 2013, Sam held several senior executive roles at Stockland.

STUART PICKERINGExecutive Director, Public Works Advisory

Stuart has over 30 years’ experience in capital development, strategic asset management and facilities operational management across the public and private sectors. He has held executive and director level positions for organisations including the Coles Group, and the Queensland and Victorian State governments across the Arts, State Development and Health portfolios. Stuart was appointed to head of Public Works Advisory in July 2016 to assist government agencies to optimise their asset solutions.

STUART CRAWFORDExecutive Director, Property Financial Services

Stuart has over 20 years’ experience in financial and operational management and has worked at the senior executive level in the property, private equity, investment banking and finance industries. Since joining Property NSW in July 2014, Stuart has managed the financial and managerial reporting for Property NSW’s property portfolio and has provided practical advice to the agency and other stakeholders regarding the financial and accounting implications of property strategies.


23

Received and processed over 597,200 tonnes of solid waste materials across seven sites.

Total returns on the GPNSW Commercial Portfolio increased to 12.2%.

Capex continues to reduce ($67/m2),7% down on the previous year and below industry benchmarks.

Maintained very low vacancy rates for our retail and commercial portfolios (1.3%) across CBD and regional areas.

THA recorded a Net Promoter Customer Service Index of +42, a reflection of its delivery of education accommodation services in remote communities.

Increased visitation 0.5% to 40.4 million2 across The Rocks and Darling Harbour precints, with a colourful mix of some of the city’s biggest and most popular events.

Average rental increase of 0.7% for maintained leases in line with CPI inflation, representing continued control over the rental costs of the portfolio.

The successful identification, review, and sale of $432m of underutilised assets in Sydney and regional NSW.1

$432m

40.4m

597,200

+42

1.3%

Continued implementation of the Government’s Decade of Decentralisation policy on office accommodation. To date there has been a reduction of 35,100m2 of office space from the CBD, which has resulted in the relocation of 2,300 government employees to suburban and metropolitan areas.

7%15.3m2

35,100m2

Key highlights for Property NSW in the 2015/16 financial year

Our performance

Improvement in utilisation of office space from 15.8m2/FTE to 15.3m2/FTE for the total portfolio under Property NSW management.

1. Sales that Property NSW assisted agencies in divesting. Whole of Government property sales for 2015/16 totalled $2.01bn, including PTEs and SOCs.2. Electronic people counters are installed in key locations in The Rocks and Darling Harbour. The counters emit an infrared beam

and, each time a pedestrian breaks the beam, a people movement is registered. Calibration and expansion calcluations are applied to raw counts to ensure that final figures estimate total pedestrian flow. These figures may include repeat visits made by visitors, workers and residents.


Commercial Portfolio UtilisationOur primary goal is to ensure that the property we manage best supports core service delivery of agencies, by: • ensuring that space is well utilised• minimising rental cost by leveraging the

bargaining power of Government• maximising precinct value• maximising efficiency of landfill operations; and• providing quality housing services for teachers.

Utilisation1: In 2015/16, the total portfolio under Property NSW2 management saw an improvement in utilisation3 of office space from 15.8m2/FTE to 15.3m2/FTE. This covers both owned and leased properties, and is a result of improved Property NSW policies and processes. Through a better understanding of agency requirements, we have been able to implement a more robust assessment and approval process of space requirements for renewals and new leases.

During 2015/16, the largest improvements have been in CBD assets, which have seen a decrease of utilised space of 0.5m2/FTE on average. A 13m2/FTE is the NSW Government’s long-term utilisation target, and the continued downward

trend reflects the improved collaborative relationship between Property NSW and agencies to both recognise and deliver on opportunities for improved utilisation.

This improving utilisation has significant ongoing impacts on total rental cost as leases are renewed. Given the significant staffing base working in properties managed by Property NSW, the 0.3m2/FTE utilisation reduction achieved could represent over 15,000m2 (approx. 2% of the leased portfolio) in reduced space. Note that some of these reductions have come through accommodating staff increases into the same space, but regardless, there is a significant future rental cost saving directly resulting from these improved utilisation rates.

For the Property NSW managed portfolio, including operational space, total utilised space per FTE in both the CBD (15.7m2/FTE) and Metro (15.9m2/FTE) portfolios is significantly below benchmark levels (19.2m2/FTE and 18.1m2/FTE respectively4).

Leased Portfolio Rental Costs: As the size of the leased portfolio grows (through both asset sales and changing Government priorities), managing the average rental costs of commercial leases becomes increasingly important. Property NSW seeks to add value through employing a greater collective bargaining power than individual agencies would have in order to deliver both lower and more stable rental costs for Government.

In 2015/16, Property NSW facilitated accommodation changes in the CBD prime market, resulting in an increased average rental cost from $600/m2 5 to $623/m2 for that class of occupation, an increase of 3.8%. Across the owned and managed portfolio there has been a marginal increase in the cost per square metre of 0.8%, well below the increase in the CPI for the year.

Performance overview

1. Property NSW uses accepted industry standards in calculating utilisation results. It should be noted that temporary vacancies due to lease expiries, building refurbishments, agency downsizing, etc., can affect year-on-year figures; and that Property NSW numbers are reliant on the accuracy of agency staff numbers, which are collected annually through an employment survey.

2. Commercial property statistics reflect the GPNSW portfolio, comprising 99% of the commercial office NLA managed by Property NSW.3. Utilisation target of 13m2/FTE implemented under ERC minute, are exclusive of operational space, and these figures reflect that.4. BIS Shrapnel Sydney Commercial Property Prospects – Supply & Demand for Sydney CBD and Metropolitan office space – 2016.5. Adjustment to prior year comparatives to include previously excluded rent.

Utilisation excluding operational space (m2/FTE)

12/13 12/13

16.5

16.1

15.8

15.3

CBD

16.6

16.6

16.1

14.8

Metro

15.5

15.1

14.8

15.0

Regional

17.9

16.8

17.0

16.2

13/14 13/1414/15 14/1515/16 15/16

down 1.8% pa

24


12/13 13/14 14/15 15/16

Commercial Portfolio Performance1

The core aim of Property NSW in property management is to ensure property accommodation supports the core service delivery of agencies. Across Government, this requires a certain level of property ownership, where service delivery is dependent on continuity of asset ownership and the ability to structure fit-outs and other accommodation arrangements to enhance the ability of the agency to deliver on its service requirements.

Accordingly, Property NSW seeks to manage returns and expenditures of capital assets as secondary and supporting goals, rather than optimising portfolio returns at the expense of wider objectives. Note that the asset performance included in this section contains only commercial properties to provide accurate comparisons to benchmarks.

Total returns from the commercial portfolio are difficult to compare consistently from year to year due to the changing nature of the portfolio within Property NSW. Despite this, total returns reflect the upturn in the Sydney office market, even though these remain below the Investment Property Databank (IPD) benchmark of 14.6%.

The five year rolling Capital expenditure on the commercial portfolio has fallen as Property NSW continues to focus on the capital maintenance on those assets identified as strategic assets required to be held for the long term or requiring immediate expenditure. In 2015/16, the five year rolling average for capex ($67/m2) was below the benchmark.

Property NSW continues to focus on Operating expenditure for commercial assets and in 2014/15, average opex per square metre has increased broadly in line with the market across the entire portfolio, due mainly to increased obligations on newly vested properties.

6. Returns have been calculated having regard to passing rents, capital expenditure and changes in market value. Total Commercial Properties Benchmark Source – IPD Australian Quarterly Digest for secondary office.

7. Capital expenditure includes expenditure related to items that are significant replacements or additions to existing properties.

12/13

68 69

74 74

76 81 83

96

CBD

Metro

Regional

45 37 54

89

73 79 81 66

13/14 14/15 15/16

Total Commercial Properties6

Total Returns (% pa)

5.8 6.

3

8.6 12

.2

14.6

12/13 13/14 14/15 15/16 Benchmark

115

82

72 67

12/13 13/14 14/15 15/16

Total Commercial PropertiesOperating Expenditure ($/m2)

Total Commercial Properties7

Capital Expenditure ($/m2)

25


26

Retail Portfolio PerformanceProperty NSW manages significant retail leases in The Rocks and Darling Harbour precincts, including over 200 stallholders at The Rocks Markets.

The Rocks, Circular Quay, and Darling Harbour are significant cultural and heritage precincts to Sydney, New South Wales, and Australia. They are popular destinations for local and international visitors and contribute significantly to the State’s economy.

In The Rocks, over 14.5 million people movements were recorded in 2015/16, with people enjoying the entertainment, shopping and dining experiences on offer. This was an increase in people movements of 2.5% on the previous year.

In Darling Harbour, 25.9 million people movements were recorded in 2015/16, with people enjoying attractions and events in the precinct. This was a decrease in people movements of 0.6% on the previous year.

Tenant sales turnover growth in SHFA’s retail portfolio has increased 8% over the past year, representing significant growth in food and beverage tenants.

Vacancies for retail spaces continue to remain low comparative to the Sydney CBD benchmark of 4.4%11.

Waste Portfolio PerformanceWAMC operates one open landfill site at Eastern Creek 2, and is managing its rehabilitation and maintenance, post-closure. WAMC continues to manage the rehabilitation and maintenance of eight other closed landfill sites at Thornleigh, Merrylands, Grange Avenue, Eastern Creek 1, Castlereagh, Harrington Quarry, Lucas Heights 1 and Belrose.

In addition, WAMC monitors and manages leachate treatment facilities at both the open and closed landfill sites, and manage joint venture landfill gas and energy systems to supply electricity into the grid as a sustainable and renewable energy source,WAMC received 597,200 tonnes of solid waste materials at its operating landfills during the reporting period, which was 3% above the budgeted volume of 580,000 tonnes (WAMC’s customers delivered additional tonnes to meet its commercial and operational objectives).

Housing Portfolio PerformanceAt 30 June 2016, THA’s portfolio consisted of 1,311 properties, including 83 residences under management (owned by the Department of Education).

During the year the average occupancy rate was 87.8% (85.0% in 2014/15). The teacher utilisation rate, a more accurate efficiency indicator increased from 73.9% to 76.8%.

Where a property is vacant due to lack of teacher demand, THA (through its managing agents) lease that property to a private tenant.

THA completed the construction of 16 new residences for a total capital cost of $4.6m. Four new blocks of land were acquired in Broken Hill, Coonamble and Brewarrina. Nine properties, deemed surplus to needs, were sold during the year, contributing $1.7m towards new teacher housing.

8. Source data: GPNSW from MRI database as at 30 June 2016. 9. Sydney CBD Benchmark source – PCA CBD Vacancy Rate, July 2016. 10. Metro (suburban) Benchmark Source – BIS Shrapnel Non CBD Vacancy Rate, December 2014.11. Retail Benchmark source – JLL Sydney CBD Prime Specialty Shops Vacancy Rate, June 2016.

Property NSW has continued to maintain very low vacancy rates for the owned commercial properties with CBD vacancy at 0.5%8 vs. benchmark9 of 5.6%, and the Metro areas (0.1%5 vs. 5.5%10).

Commercial Vacancy (%)

12/13

3.2

2.5

5.0

1.3

CBD

0 0 0

Metro

1.42.

1 3.5

0.5

0.1

Regional

4.7 5.1 5.8

3.4

13/14 14/15 15/16 12/13 13/14 14/15 15/16

Retail Vacancy (%)

2.9

4.6

1.7 1.9

4.4

12/13 13/14 14/15 15/16 Benchmark


27

Financial Performance

Property NSW is in its first year of reporting combined results, which includes Government Property NSW, Sydney Harbour Foreshore Authority, Waste Assets Management Corporation, and Teacher Housing Authority.

Net Result ($m)

Capital Program ($m) Total Assets ($bn) Revaluations

Financial Distributions ($m)

In 2015/16, Property NSW recorded an operating surplus of $33.5m against a budgeted deficit of $2.5m (excluding $200.2m of RestartNSW Grant payments). The decrease from the prior year is due to a reduction in realised gains on the sale of properties offset by increased fee-for-service revenue growth.

Capital program projects in 2015/16 comprised of works on the renewal and upgrading of owned buildings, works of a regulatory compliance nature, minor works on corporate systems, and equipment purchases. Total capital expenditure of $38.3m for the 2015/16 financial year was $12.9m below the budget. The underspend resulted mainly from the reassessment of capital expenditure requirements in 2015/16 on owned property assets earmarked for potential divestment in the near future.

Property NSW retained a healthy balance sheet position at 30 June 2016, with the ratio of total assets to total liabilities standing at 6.3:1 (5.8:1 at 30 June 2015) and net assets totalling $2.5b ($2.5b at 30 June 2015).

Asset revaluation increases have been correspondingly offset by asset sales and depreciation of plant, property and equipment.

Major contributors to the $169.6m net revaluation movement in the Property NSW portfolio were 52 Martin Place ($43m), IMAX Theatre ($29m) and Argyle Stores ($10m). In a buoyant leasing market with record low interest rates, the portfolio has benefited from positive revaluations.

Financial distributions to Government comprised $4.1m from surplus income on operations, $62.5m from net asset sale proceeds, and $200.2m contribution to the RestartNSW Fund from proceeds of owned asset sales.

Excludes contribution to RestartNSW fund

$33.5m

$38.3m $3.0bn $169.6m

$266.8m

$38.3

$41.5 $2.9

$3.0

$266.8

$34.1 $79.8

$23.8

$33.5

$35.1 $2.6Retail

50%

Other<1%

Commercial 49%

$59.0

FY16

FY16 FY16

FY16

FY15

FY15 FY15

FY15

FY14

FY14 FY14

FY14


28

2014/15 2015/16 2015/16 2015/16 2016/17actual actual budget variance budget$’000 $’000 $’000 $’000 $’000

Operating resultExpenses 786,398 979,069 812,146 (166,923) 869,636Revenues 784,077 792,324 771,316 21,008 961,655Other Gains/(Losses) 36,393 20,009 38,361 (18,352) 37,132Net operating result – surplus/(deficit)

34,072 (166,736) (2,469) (164,267) 129,151

Revaluations 133,043 169,597 - 169,597 -Total comprehensive income 167,115 2,861 (2,469) 5,330 129,151

Financial distributionsNormal Distribution 27,398 4,089 11,461 (7,372) 4,046Capital Repatriation 52,393 62,500 169,546 (107,046) 271,500RestartNSW Grant Payments - 200,202 - 200,202 -Total financial distributions 79,791 266,791 181,007 85,784 275,546

Financial positionTotal Assets 2,954,354 2,999,652 2,719,381 280,271 4,113,097Total Liabilities 507,792 476,476 437,109 (39,367) 1,926,833Net Assets/equity 2,446,562 2,523,176 2,282,272 240,904 2,186,265

Capital programProperty Refurbishment & Other 41,530 38,317 51,228 12,911 251,227Total capital program 41,530 38,317 51,228 12,911 251,227

Financial Performance Summary

Budget Overview Property NSW’s 2016/17 budget projects an operating surplus of $129.2m. The major contributor to the increase in revenues is the inclusion of $155m of grant income for the acquisition of assets from NSW Health for vesting.

Excluding the impact of the 2015/16 RestartNSW grant payments, there is an increase in expenditure predominantly due to the completion of the International Convention Centre at Darling Harbour in 2016/17 and Property NSW assuming management of the new facilities.

The sale of a number of assets and ground leases have been budgeted to impact both the net operating result and capital repatriations.

Performance against BudgetThe net operating result for Property NSW was impacted by the unbudgeted contribution of $200.2m grant payments to Restart NSW. Excluding the RestartNSW grant payments, all agencies within Property NSW delivered favourable operating results against budget. The majority of the other gains for 2015/16 is due to the sale of Rozelle marshalling yards.

*Net Operating result for 2015/16 is $33,466 excluding RestartNSW grant payments from expenses.


29

2014/15 2015/16 2015/16 2015/16 2016/17actual actual budget variance budget$’000 $’000 $’000 $’000 $’000

Government Property NSW1

Expenses 501,659 717,017 531,120 (185,897) 529,407Revenues 509,168 530,327 545,899 (15,572) 684,143Other Gains/(Losses) 36,426 1,025 2,343 1,318 -Net operating result – surplus/(deficit)

43,935 (185,665) 17,122 (202,787) 154,736

Sydney Harbour Foreshore Authority2

Expenses 150,541 137,368 158,007 20,639 222,595Revenues 150,117 126,366 108,146 18,220 159,054Other Gains/(Losses) (157) 18,720 36,150 (17,430) 37,569Net operating result – surplus/(deficit)

(581) 7,718 (13,711) 21,429 (25,972)

Luna Park Reserve TrustExpenses 1,467 1,682 1,929 247 1,577Revenues 1,742 1,917 2,207 (290) 1,855Other Gains/(Losses) - - - - -Net operating result – surplus/(deficit)

275 235 278 (43) 278

Waste Assets Management Corporation3

Expenses 112,547 103,176 101,400 (1,776) 95,547Revenues 106,136 116,381 97,700 18,681 99,197Other Gains/(Losses) 46 225 - 225 -Net operating result – surplus/(deficit)

(6,365) 13,430 (3,700) 17,130 3,650

Teacher Housing AuthorityExpenses 20,184 19,826 19,690 (136) 20,510Revenues 16,914 17,333 17,324 (31) 17,406Other Gains/(Losses) 78 39 (132) 171 (437)Net operating result – surplus/(deficit)

(3,192) (2,454) (2,458) 4 (3,541)

Property NSWExpenses 786,398 979,069 812,146 (166,923) 869,636Revenues 784,077 792,324 771,316 21,008 961,655Other Gains/(Losses) 36,393 20,009 38,361 (18,352) 37,132Net operating result – surplus/(deficit)

34,072 (166,736) (2,469) (164,267) 129,151

Financial Performance – Statutory Bodies

1. Net Operating result for Government Property for 2015/16 includes RestartNSW grant payments of $200.2m. 2. Other Gains/(Losses) for 2015/16 excludes Fair Value Increment on Investment Properties of $58.0m that has been

allocated to Other Comprehensive Income for consistency.3. Expenses for 2015/16 excludes the revaluation decrement of land and buildings of $709,000 to Other Comprehensive

Income for consistency.


30

Environment and sustainabilityProperty NSW delivers sustainability outcomes for its asset portfolio

Property NSW recognises the need to use natural resources responsibly, while meeting its operational objectives, in a manner that is sustainable and in accordance with the NSW Government Resource Efficiency Policy (GREP) July 2014 and NSW Energy Efficiency Action Plan August 2013.

Imperative to this is the delivery of sustainability outcomes for our portfolio of assets. Our key objectives in this space are to improve resource and operational efficiencies while reducing costs for properties owned and leased for government agencies.

We have delivered savings at owned and leased assets by building and occupying assets that achieve NSW GREP policy requirements, driving performance on leased sites with green leases, integrating sustainability requirements in all relevant capital works, and ensuring continuous improvement in operational efficiency at owned and leased sites to reduce energy, water and waste costs.

2015/16 OverviewEnergy reduction measures in Property NSW owned buildings have aimed to mitigate the impact of future energy cost increases. A number of energy efficiency projects have been scoped and prioritised based on the shortest ‘in use’ payback period. These investments optimise the resource efficiency gain, in particular when reviewing energy consumption from lighting and Building Management Systems.

Total Billed Utility Usage and Cost Summary 2015/161

1. These numbers: • are aggregate totals based on total costs paid in a financial year • do not reflect vacancy within buildings • are impacted by variations due to sale, lease backs and vesting of sites during the financial year • only show usage and costs for utility accounts maintained by Government Property NSW. Further, costs are impacted by changes to utility tariff escalations.

Electricity Consumption

34

KWh millions$ millions

32 31

13/14 14/15 15/16

8

6

4

2

Natural Gas Consumption18

MJ millions$ thousands

18 17

13/14 14/15 15/16

400

320

240

160

80

Water Consumption

76

kL thousands$ thousands

38 35

13/14 14/15 15/16

100

60

40

20

80


31

NABERS Ratings – Owned Assets All government owned buildings are subject to GREP, which requires office buildings over 2,000m2 to achieve and maintain a NABERS rating above 4.5 stars by June 2017.

Since 2013, Property NSW has undertaken extensive work to develop its energy efficiency improvement plan.

This work underpins Property NSW’s approach to achieving the outcomes sought from the GREP.

Weighted average NABERS ratings for large owned offices (stars)2

Green Lease Sites Managed by Property NSW – Leased AssetsProperty NSW is working with its client agencies to implement Green Leases, designed to achieve water and energy efficiencies as well as other sustainability goals. The policy is to negotiate Green Leases for all new and renewed leases of at least two years, where NSW Government agencies occupy at least 2,000m2 Net Lettable Area (NLA).

Green Lease coverage

Solar Photovoltaic (PV) OpportunitiesSix solar Power Purchase Agreement (PPA) sites were identified by Property NSW under the Office of Environment and Heritage (OEH) program (777 Large Market Contract).

Lighting UpgradesProperty NSW progressively reviews all sites to identify properties with nominal lighting power density of 12W/m2 or higher for implementation of LED lighting upgrades, improving energy efficiency, reducing total demand at the property, incorporating long term warranties and realising electricity bill savings for all stakeholders.

Electrical and Water Equipment and Appliance StandardsProperty NSW has incorporated GREP standard requirement for appliance, fixtures and fitting in its fitout guidelines and new building design guide as a minimum requirement.

WasteLeased site waste is managed by landlords (some landlords provide waste information through the Green Lease forum). In some cases, agency tenants manage their waste and have direct waste contracts.

Property NSW-owned site waste contracts currently do not include reporting, source segregation and training in the scope. When contracts are renewed in 2018, these requirements will be incorporated.

Property NSW is currently working on a Waste Management Strategy to incorporate source segregation and recycling targets for its business, including:• using recycling bins—including organic, co-

mingled, and paper and cardboard—in all office kitchens

• installing additional recycling bins during events to encourage visitors to recycle

• providing water refill stations at major events• encouraging tenants to use the organic food

processor in The Rocks Centre shared waste facility to process food waste, diverting it from landfill

• implementing successful digital and social media marketing to promote events, reducing printed marketing material.

2. The above figures do not represent the weighted average NABERS ratings for the entire owned office portfolio. They represent the weighted average for a large proportion of the owned office portfolio and are based on NABERS ratings attained during 2015/16.

Energy 4.4

249,024m2

Water 4.3


32

21Eastern Creek landfill gas power plant (1) and landfill gas collection infrastructure (2).

Property NSW collaborated closely with Cromwell Property Group to implement Green Leases across 5 large leased offices in 2015/16. A total of 300 tonnes of general waste, paper, cardboard and commingled wastes were generated across these properties, with a 56% recycling rate was achieved at these sites. This rate would be higher if secure paper document recycling was included.

Purchase of 6% Green PowerProperty NSW purchases electricity through the NSW Procurement 777 and 776 whole of government contract which have a default 6% Green Power component.

Low VOC Surface CoatingsProperty NSW has incorporated GREP standard requirements for Low VOC coatings in its fitout guidelines and new building design guide, as a minimum requirement.

Renewable EnergyGenerator stations at WAMC’s landfill sites generate 100,000 MWh (megawatt hours) of renewable energy annually by processing gas generated and captured within the landfills. Green credits and renewable energy are produced and 460,000 tonnes of climate-impacting carbon dioxide (CO2-e)atmospheric emissions are avoided in the process.

NSW Government: New Government Building Design RequirementsMinimum requirement NSW GREP policy 2014:• NABERS energy ratings: designed to 4.5 Star

energy rating (whole building, base building and tenancy ratings; landlords/tenants are required to sign a commitment agreement with a NABERS national administrator) without Green Power.

• NABERS water ratings: designed to 4 Star water rating (whole building, need to sign a commitment agreement with NABERS national administrator), where cost effective.

• Non-office buildings: Non-office buildings types are to be designed and built with predicted energy consumption at least 10% less than National Construction Code ‘Deemed to Satisfy’ minimum compliance.

• General office lighting (troffers) lighting: power density should be below 7 W/m2 while meeting the Australian standard illuminance requirements for nominated use (typically this means LED lighting, depends on the spacing and grid).

• Energy Star, MEPS, GEMS, WELS requirements: include specifications for energy and water appliances and equipment as well as Low VOC surface coatings in fit-out, major refurb and new building scope.

• THA: in conjunction with the Government Architects Office, THA is industry partnering with the Faculty of Architecture, Design and Planning at the University of Sydney for an Australian Research Council (ARC) linkage grant. This research compares the biophysical performance and achieved satisfaction outcomes of the Eco Village against some of THA’s more conventional residences in Broken Hill. Addressing the social and environmental aspects of sustainable housing, the research focuses on the role of the occupant’s attitudes and satisfaction in social sustainability, using a quality of life metric – developed by the University.


33

• Total reduction in billed electricity

• Total reduction in billed water

• Electricity tariff savings – $51,000 annual electricity bill savings through identification and implementation of tariff changes.

• AGL portal – Delivered natural gas data and reporting access to AGL Insight portal, enabling timely, robust natural gas reporting and monitoring.

2015/16 Key Outcomes

• NABERS Energy Ratings – 66% of rated NLA valid during FY15/16 was at or above 4.5 Star rating

• NABERS Water Ratings – 88% of rated NLA valid during FY15/16 was at or above 4 Star rating

• Green Lease coverage – About 249,024m2 of leased NLA was covered by a Green Lease

• ERM portal and electricity reporting – Delivered electricity data and reporting access to ERM portal for all relevant stakeholders on the new whole of government contracts 777 and 776 starting 1 Jul 2015, enabling electricity reporting and monitoring.

$51,00086%

66%18.7%

2.1%

Property NSWBligh House, Level 3, 4–6 Bligh Street, Sydney NSW 2000GPO Box 4081, Sydney NSW 2001T: 02 9273 3800

Level 6, 66 Harrington Street, The Rocks NSW 2000PO Box N408, Grosvenor Place NSW 1220T: 02 9240 8500www.property.nsw.gov.au

Teacher Housing Authority NSW McKell Building, Level 18, 2–24 Rawson Place, Sydney NSW 2000Locked Bag 7, Haymarket NSW 1240T: 02 9260 2000www.tha.nsw.gov.au

Waste Assets Management CorporationLevel 2, 10 Valentine Avenue, Parramatta NSW 2150PO Box 3366, Parramatta NSW 2124T: 02 9685 4960www.finance.nsw.gov.au/waste-assets-management-corporation

Valuation Services1 Prince Albert Road, Queens Square, Sydney NSW 2001PO Box 745, Bathurst NSW 2795T: 1800 110 038www.valuergeneral.nsw.gov.au

Public Works AdvisoryMcKell Building, 2–24 Rawson Place, Sydney NSW 2000T: 02 9372 8877 www.publicworksadvisory.nsw.gov.au


35

For the year ending 30 June 2016

Appendix A Government Property NSW

Appendix B Sydney Harbour Foreshore Authority

Appendix C Teacher Housing Authority of NSW

Note Under clause 6 of Schedule 5 of the Waste Recycling and Processing Corporation (Authorised Transaction) Act 2010, the Treasurer has designated that Waste Assets Management Corporation’s Annual Report be included with the Department of Finance, Service and Innovation’s Annual Report.

Financials and statutory information

35


36 This page intentionally left blank

Government Property NSW 2015–16

37

• Financial statements for the year ended 30 June 2016• Statutory information

Government Property NSWAppendix A


38

• Financial statements for the year ended 30 June 2016

Government Property NSW


39


40


41


42

- 1 -

Note Actual Budget Actual2016 2016 2015$'000 $'000 $'000

Expenses Excluding LossesOperating Expenses

Personnel Services Expense 2(a) 25,672 26,968 18,893Other Operating Expenses 2(b) 471,419 483,452 455,135

Depreciation and Amortisation 2(c) 12,888 14,875 16,741Grants and Subsidies 2(d) 200,697 - 4,530Finance Costs 2(e) 6,341 5,825 6,360

TOTAL EXPENSES EXCLUDING LOSSES 717,017 531,120 501,659

RevenueSale of Goods and Services 3(a) 497,194 512,848 485,068Investment Revenue 3(b) 6,342 6,260 6,130Grants and Contributions 3(c) 26,241 26,241 17,470Other Revenue 3(d) 550 550 500

Total Revenue 530,327 545,899 509,168

Gain/(Loss) on Disposal 4 1,468 2,643 28,264Other Gains/(Losses) 5 (443) (300) 8,162

Net Result (185,665) 17,122 43,935

Other Comprehensive Income

Items that will not be Reclassified to Net Result: Net Increase/(Decrease) in Property, Plant and Equipment Revaluation Surplus 17(b)(i) 82,041 - 46,984

Total Other Comprehensive Income 82,041 - 46,984

TOTAL COMPREHENSIVE INCOME (103,624) 17,122 90,919

Government Property NSWStart of Audited Financial Statements

Statement of Comprehensive Income For the Year Ended 30 June 2016

[The accompanying notes form part of these financial statements]


43

- 1 -


Expenses Excluding LossesOperating Expenses

Personnel Services Expense 2(a) 25,672 26,968 18,893Other Operating Expenses 2(b) 471,419 483,452 455,135

Depreciation and Amortisation 2(c) 12,888 14,875 16,741Grants and Subsidies 2(d) 200,697 - 4,530Finance Costs 2(e) 6,341 5,825 6,360

TOTAL EXPENSES EXCLUDING LOSSES 717,017 531,120 501,659

RevenueSale of Goods and Services 3(a) 497,194 512,848 485,068Investment Revenue 3(b) 6,342 6,260 6,130Grants and Contributions 3(c) 26,241 26,241 17,470Other Revenue 3(d) 550 550 500

Total Revenue 530,327 545,899 509,168

Gain/(Loss) on Disposal 4 1,468 2,643 28,264Other Gains/(Losses) 5 (443) (300) 8,162

Net Result (185,665) 17,122 43,935

Other Comprehensive Income

Items that will not be Reclassified to Net Result: Net Increase/(Decrease) in Property, Plant and Equipment Revaluation Surplus 17(b)(i) 82,041 - 46,984

Total Other Comprehensive Income 82,041 - 46,984

TOTAL COMPREHENSIVE INCOME (103,624) 17,122 90,919

Government Property NSWStart of Audited Financial Statements

Statement of Comprehensive Income For the Year Ended 30 June 2016


- 2 -


ASSETSCurrent Assets

Cash and Cash Equivalents 6(a) 108,891 60,610 265,675Receivables 7 76,114 55,366 70,076Non-Current Assets Held For Sale 9 52,086 - 80,279

Total Current Assets 237,091 115,976 416,030

Non-Current AssetsReceivables 7 226,949 246,112 218,540Property, Plant and Equipment 8 729,526 619,789 593,175Intangible Assets 10 1,893 4,533 865Other 11 6,450 6,400 5,850

Total Non-Current Assets 964,818 876,834 818,430

TOTAL ASSETS 1,201,909 992,810 1,234,460

LIABILITIESCurrent Liabilities

Payables 13 23,669 7,836 19,425Borrowings 14 866 866 1,074Provisions 15 103,549 53,207 69,941Other Liabilities 16 8,025 9,593 8,476

Total Current Liabilities 136,109 71,502 98,916

Non-Current LiabilitiesPayables 13 7,687 - 5,338Borrowings 14 34,398 34,398 35,265Provisions 15 116,380 131,704 155,510Other Liabilities 16 57,865 51,420 51,099

Total Non-Current Liabilities 216,330 217,522 247,212

TOTAL LIABILITIES 352,439 289,024 346,128

NET ASSETS 849,470 703,786 888,332

EQUITYAccumulated Funds 667,259 628,833 788,162Asset Revaluation Reserve 17(b) 182,211 74,953 100,170

TOTAL EQUITY 849,470 703,786 888,332



Statement of Financial PositionAs At 30 June 2016


44

- 3 -

Asset Asset

Accumulated Revaluation Total Accumulated Revaluation TotalNote Funds Reserve Equity Funds Reserve Equity

2016 2016 2016 2015 2015 2015$'000 $'000 $'000 $'000 $'000 $'000

Opening Balance 788,162 100,170 888,332 708,139 53,186 761,325

Net Result for the Year (185,665) - (185,665) 43,935 - 43,935Other Comprehensive Income:

Net Increase/(Decrease) in Property, Plant and Equipment Revaluation Surplus 17(b)(i) - 82,041 82,041 - 46,984 46,984

Total Other Comprehensive Income - 82,041 82,041 - 46,984 46,984

Total Comprehensive Income for the Year (185,665) 82,041 (103,624) 43,935 46,984 90,919

Transactions with Owners as OwnersFinancial Distributions 17(a) (66,589) - (66,589) (65,329) - (65,329)Net Increase/(Decrease) in Net Assets from Equity Transfers 17(c) 131,351 - 131,351 101,417 - 101,417

Total Transactions with Owners as Owners 64,762 - 64,762 36,088 - 36,088

Closing Balance 667,259 182,211 849,470 788,162 100,170 888,332


Statement of Changes in EquityFor the Year Ended 30 June 2016



45

- 3 -

Asset Asset

Accumulated Revaluation Total Accumulated Revaluation TotalNote Funds Reserve Equity Funds Reserve Equity

2016 2016 2016 2015 2015 2015$'000 $'000 $'000 $'000 $'000 $'000

Opening Balance 788,162 100,170 888,332 708,139 53,186 761,325

Net Result for the Year (185,665) - (185,665) 43,935 - 43,935Other Comprehensive Income:

Net Increase/(Decrease) in Property, Plant and Equipment Revaluation Surplus 17(b)(i) - 82,041 82,041 - 46,984 46,984

Total Other Comprehensive Income - 82,041 82,041 - 46,984 46,984

Total Comprehensive Income for the Year (185,665) 82,041 (103,624) 43,935 46,984 90,919

Transactions with Owners as OwnersFinancial Distributions 17(a) (66,589) - (66,589) (65,329) - (65,329)Net Increase/(Decrease) in Net Assets from Equity Transfers 17(c) 131,351 - 131,351 101,417 - 101,417

Total Transactions with Owners as Owners 64,762 - 64,762 36,088 - 36,088

Closing Balance 667,259 182,211 849,470 788,162 100,170 888,332




- 4 -


CASH FLOWS FROM OPERATING ACTIVITIESPayments

Personnel Services (26,081) (26,968) (19,009)Finance Costs (4,929) (4,929) (5,015)Grants and Subsidies (200,202) - (4,530)Other (466,753) (511,156) (458,472)Total Payments (697,965) (543,053) (487,026)

ReceiptsSale of Goods and Services 495,673 507,319 477,621Interest Received 6,388 6,418 6,164Grants and Contributions 26,241 26,241 12,325Total Receipts 528,302 539,978 496,110

NET CASH FLOWS FROM OPERATINGACTIVITIES 6(b) (169,663) (3,075) 9,084

CASH FLOWS FROM INVESTING ACTIVITIESPurchases of Property, Plant and Equipment (9,165) (21,329) (6,596)Proceeds from Sale of Property, Plant and Equipment 89,707 172,189 218,837

NET CASH FLOWS FROM INVESTING ACTIVITIES 80,542 150,860 212,241

CASH FLOWS FROM FINANCING ACTIVITIESRepayment of borrowings and advances (1,074) (1,074) (989)Financial Distributions to the State Government 1(l) (66,589) (181,007) (65,329)

NET CASH FLOWS FROM FINANCING ACTIVITIES (67,663) (182,081) (66,318)

NET INCREASE/(DECREASE) IN CASH ANDCASH EQUIVALENTS (156,784) (34,296) 155,007

Opening Cash and Cash Equivalents 265,675 94,906 110,668

CLOSING CASH AND CASH EQUIVALENTS 6(a) 108,891 60,610 265,675


Statement of Cash FlowsFor the Year Ended 30 June 2016



46

- 5 -

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Reporting Entity

Government Property NSW (GPNSW) was established under the Government Property NSW Act 2006 (the Act) to improvethe management of the NSW Government's owned and leased real property portfolio and to become a central agencywith a whole-of-government focus on the acquisition, disposition and better utilisation of real property assets. GPNSWcommenced operations on 1 September 2006 and is domiciled in Australia. Its principal business address is Bligh House,4-6 Bligh Street, Sydney NSW 2000. GPNSW is a not-for-profit entity as profit is not its principal objective. GPNSW isconsolidated as part of the NSW Total State Sector Accounts.

Under the Act, GPNSW is unable to employ staff. However, to enable it to exercise its functions, GPNSW can obtainpersonnel services from Government agencies who are able to engage staff under Part 4 of the Government SectorEmployment Act 2013 . During 2015-16, personnel services were provided by the Department of Finance, Services andInnovation (DFSI) (formerly Office of Finance and Services). The DFSI, a principal department, is a separate reporting entityand does not control GPNSW for financial reporting purposes.

These financial statements have been authorised for issue by GPNSW's Chief Executive Officer on 15 September 2016.

(b) Basis of Preparation

GPNSW's financial statements are general-purpose financial statements which have been prepared on a "going concern"basis and in accordance with:

(i) applicable Australian Accounting Standards (which include Australian Accounting Interpretations);(ii) the requirements of the Public Finance and Audit Act 1983 and Public Finance and Audit Regulation 2015 ; and(iii) the Financial Reporting Directions published in the Financial Reporting Code for NSW General Government Sector

Entities or issued by the Treasurer.

Property, Plant and Equipment, Non-Current Assets Held for Sale and Other Non-Current Asset are measured at fair value.Other financial statement items are prepared in accordance with the historical cost convention except where specifiedotherwise.

The accrual basis of accounting has been adopted in the preparation of the financial statements, except for cash flowinformation.

Judgements, key assumptions and estimations made by management are disclosed in the relevant notes to the financial statements.

All amounts are rounded to the nearest one thousand dollars ($'000) and are expressed in Australian currency.

(c) Statement of Compliance

The financial statements and accompanying notes comply with Australian Accounting Standards, which include AustralianAccounting Interpretations.

(d) Borrowing Costs

Borrowing costs are recognised as expenses in the period in which they are incurred, in accordance with Treasury’sMandate to not-for-profit general government sector entities.

(e) Insurance

GPNSW's insurance activities are conducted through the NSW Treasury Managed Fund Scheme of self-insurance forGovernment entities. The expense (premium) is determined by the Fund Manager based on past claim experience. Propertiesowned by GPNSW are insured for their replacement value. Management reviews the insurance coverage each year.


Notes to and Forming Part of the Financial StatementsFor the Year Ended 30 June 2016


47

- 5 -

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Reporting Entity

Government Property NSW (GPNSW) was established under the Government Property NSW Act 2006 (the Act) to improvethe management of the NSW Government's owned and leased real property portfolio and to become a central agencywith a whole-of-government focus on the acquisition, disposition and better utilisation of real property assets. GPNSWcommenced operations on 1 September 2006 and is domiciled in Australia. Its principal business address is Bligh House,4-6 Bligh Street, Sydney NSW 2000. GPNSW is a not-for-profit entity as profit is not its principal objective. GPNSW isconsolidated as part of the NSW Total State Sector Accounts.

Under the Act, GPNSW is unable to employ staff. However, to enable it to exercise its functions, GPNSW can obtainpersonnel services from Government agencies who are able to engage staff under Part 4 of the Government SectorEmployment Act 2013 . During 2015-16, personnel services were provided by the Department of Finance, Services andInnovation (DFSI) (formerly Office of Finance and Services). The DFSI, a principal department, is a separate reporting entityand does not control GPNSW for financial reporting purposes.

These financial statements have been authorised for issue by GPNSW's Chief Executive Officer on 15 September 2016.

(b) Basis of Preparation

GPNSW's financial statements are general-purpose financial statements which have been prepared on a "going concern"basis and in accordance with:

(i) applicable Australian Accounting Standards (which include Australian Accounting Interpretations);(ii) the requirements of the Public Finance and Audit Act 1983 and Public Finance and Audit Regulation 2015 ; and(iii) the Financial Reporting Directions published in the Financial Reporting Code for NSW General Government Sector

Entities or issued by the Treasurer.

Property, Plant and Equipment, Non-Current Assets Held for Sale and Other Non-Current Asset are measured at fair value.Other financial statement items are prepared in accordance with the historical cost convention except where specifiedotherwise.

The accrual basis of accounting has been adopted in the preparation of the financial statements, except for cash flowinformation.

Judgements, key assumptions and estimations made by management are disclosed in the relevant notes to the financial statements.

All amounts are rounded to the nearest one thousand dollars ($'000) and are expressed in Australian currency.

(c) Statement of Compliance

The financial statements and accompanying notes comply with Australian Accounting Standards, which include AustralianAccounting Interpretations.

(d) Borrowing Costs

Borrowing costs are recognised as expenses in the period in which they are incurred, in accordance with Treasury’sMandate to not-for-profit general government sector entities.

(e) Insurance

GPNSW's insurance activities are conducted through the NSW Treasury Managed Fund Scheme of self-insurance forGovernment entities. The expense (premium) is determined by the Fund Manager based on past claim experience. Propertiesowned by GPNSW are insured for their replacement value. Management reviews the insurance coverage each year.



- 6 -



1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

(f) Accounting for the Goods and Services Tax (GST)

Income, expenses and assets are recognised net of the amount of GST, except that:

(i) the amount of GST incurred by GPNSW as a purchaser that is not recoverable from the Australian Taxation Officeis recognised as part of the cost of acquisition of an asset or as part of an item of expense;

(ii) receivables and payables are stated with the amount of GST included; and

(iii) commitment amounts disclosed in the financial statements include the amount of GST recoverable from, or payable to,the Australian Taxation Office.

Cash flows are included in the Statement of Cash Flows on a gross basis. However, the GST components of cash flowsarising from investing and financing activities which are recoverable from, or payable to, the Australian Taxation Office areclassified as operating cash flows.

(g) Income Recognition

Income is measured at the fair value of the consideration or contribution received or receivable. Additional commentsregarding the accounting policies for the recognition of income are discussed below.

(i) Operating Lease Income

Operating lease income is recognised in accordance with AASB 117 "Leases". Lease income from operating leaseswhere GPNSW is the lessor is recognised as income in the Statement of Comprehensive Income on a straight-linebasis over the lease term. Contingent rental income is recognised as income in the period in which it is earned.

(ii) Finance Lease Income

Finance lease income is recognised in accordance with AASB 117 "Leases". Lease income from finance leases whereGPNSW is the lessor is recognised as income in the Statement of Comprehensive Income over the lease period soas to allocate finance income over the lease term on a systematic and rational basis. This income allocation is basedon a pattern reflecting a constant period return on GPNSW’s net investment in the lease.

The estimated unguaranteed residual value used in computing GPNSW's gross investment in each lease isreviewed regularly. If there has been a reduction in the estimated unguaranteed residual value, the income allocationover the lease term is revised and any reduction in respect of amounts accrued is recognised immediately. Contingentrent from finance leases as lessor is recognised as income in the period in which it is earned.

(iii) Fees for Services Rendered

Revenue from the rendering of services is recognised when the service is provided or by reference to the stage ofcompletion (based on labour hours incurred to date).

(iv) Interest Income

Revenue is recognised using the effective interest method as set out in AASB 139 "Financial Instruments: Recognitionand Measurement".

(v) Grants and Contributions

Grants and contributions are recognised as income when GPNSW obtains control over the assets comprising thegrant or contribution, it is probable that the economic benefits will flow to GPNSW, and the amount of the grant orcontribution can be measured reliably. Control is normally obtained upon the receipt of cash.


48

- 7 -




(g) Income Recognition (Continued)

(vi) Emerging Asset Revenue

In accordance with TPP 06-08 "Accounting for Privately Financed Projects", the Opera House Car Park is an emergingasset which GPNSW has a right to receive in 2043 under a privately financed infrastructure arrangement. The rightis being recognised as revenue and added to the asset value over the term of the car park concession. Any periodicrevaluations are accounted for in accordance with AASB 116 "Property, Plant and Equipment".

(h) Assets

(i) Acquisitions of Assets

Acquisition of assets is recognised when the risks and rewards of the asset have passed to the buyer. On property asset, this usually coincides with when the legal title passes to the buyer, which is upon settlement of a contract.

The cost method of accounting is used for the initial recording of all acquisitions of assets controlled by GPNSW. Cost is the amount of cash or cash equivalents paid or the fair value of the other consideration given to acquire the asset at the time of its acquisition or construction or, where applicable, the amount attributed to that asset when initially recognised in accordance with the requirements of other Australian Accounting Standards.

Assets acquired at no cost, or for nominal consideration, are initially recognised at their fair value at the date of acquisition (see also assets transferred as a result of an equity transfer (Note 1(m)).

Fair value is the price that would be received to sell an asset in an orderly transaction between market participants atthe measurement date.

Where payment for an asset is deferred beyond normal credit terms, its cost is the cash price equivalent; i.e. deferred payment amount is effectively discounted at an asset-specific rate.

(ii) Capitalisation Thresholds

Plant and equipment, and intangible assets costing $5,000 and above individually (or forming part of a network costing more than $5,000) are capitalised.

Property expenditure that gives rise to an effective and material increase in the future economic benefits of the property to GPNSW is capitalised. The general threshold for property expenditure capitalisation is $30,000.

(iii) Revaluation of Property, Plant and Equipment

Physical non-current assets are valued in accordance with the 'Valuation of Physical Non-Current Assets at Fair Value' Policy and Guidelines Paper (TPP 14-01). This policy adopts fair value in accordance with AASB 13 "Fair ValueMeasurement", AASB 116 "Property, Plant and Equipment" and AASB 140 "Investment Property".

Investment property is separately discussed at Note 1(h)(xvi).

Property, plant and equipment is measured at the highest and best use by market participants that is physicallypossible, legally permissible and financially feasible. The highest and best use must be available at a period that is notremote and take into account the characteristics of the asset being measured, including any socio-political restrictionsimposed by government. In most cases, after taking into account these considerations, the highest and best use isthe existing use. In limited circumstances, the highest and best use may be a feasible alternative use, where there areno restrictions on use or where there is a feasible higher restricted alternative use.

Fair value of property, plant and equipment is based on a market participants’ perspective, using valuation techniques(market approach, cost approach, income approach) that maximise relevant observable inputs and minimise unobservableinputs. GPNSW revalues each class of property, plant and equipment on annual basis to ensure that the carrying amount of each asset in the class does not differ materially from its fair value at reporting date (Note 8(b)(i) and 8(b)(ii)).


49

- 7 -




(g) Income Recognition (Continued)

(vi) Emerging Asset Revenue

In accordance with TPP 06-08 "Accounting for Privately Financed Projects", the Opera House Car Park is an emergingasset which GPNSW has a right to receive in 2043 under a privately financed infrastructure arrangement. The rightis being recognised as revenue and added to the asset value over the term of the car park concession. Any periodicrevaluations are accounted for in accordance with AASB 116 "Property, Plant and Equipment".

(h) Assets

(i) Acquisitions of Assets

Acquisition of assets is recognised when the risks and rewards of the asset have passed to the buyer. On property asset, this usually coincides with when the legal title passes to the buyer, which is upon settlement of a contract.

The cost method of accounting is used for the initial recording of all acquisitions of assets controlled by GPNSW. Cost is the amount of cash or cash equivalents paid or the fair value of the other consideration given to acquire the asset at the time of its acquisition or construction or, where applicable, the amount attributed to that asset when initially recognised in accordance with the requirements of other Australian Accounting Standards.

Assets acquired at no cost, or for nominal consideration, are initially recognised at their fair value at the date of acquisition (see also assets transferred as a result of an equity transfer (Note 1(m)).

Fair value is the price that would be received to sell an asset in an orderly transaction between market participants atthe measurement date.

Where payment for an asset is deferred beyond normal credit terms, its cost is the cash price equivalent; i.e. deferred payment amount is effectively discounted at an asset-specific rate.

(ii) Capitalisation Thresholds

Plant and equipment, and intangible assets costing $5,000 and above individually (or forming part of a network costing more than $5,000) are capitalised.

Property expenditure that gives rise to an effective and material increase in the future economic benefits of the property to GPNSW is capitalised. The general threshold for property expenditure capitalisation is $30,000.

(iii) Revaluation of Property, Plant and Equipment

Physical non-current assets are valued in accordance with the 'Valuation of Physical Non-Current Assets at Fair Value' Policy and Guidelines Paper (TPP 14-01). This policy adopts fair value in accordance with AASB 13 "Fair ValueMeasurement", AASB 116 "Property, Plant and Equipment" and AASB 140 "Investment Property".

Investment property is separately discussed at Note 1(h)(xvi).

Property, plant and equipment is measured at the highest and best use by market participants that is physicallypossible, legally permissible and financially feasible. The highest and best use must be available at a period that is notremote and take into account the characteristics of the asset being measured, including any socio-political restrictionsimposed by government. In most cases, after taking into account these considerations, the highest and best use isthe existing use. In limited circumstances, the highest and best use may be a feasible alternative use, where there areno restrictions on use or where there is a feasible higher restricted alternative use.

Fair value of property, plant and equipment is based on a market participants’ perspective, using valuation techniques(market approach, cost approach, income approach) that maximise relevant observable inputs and minimise unobservableinputs. GPNSW revalues each class of property, plant and equipment on annual basis to ensure that the carrying amount of each asset in the class does not differ materially from its fair value at reporting date (Note 8(b)(i) and 8(b)(ii)).

- 8 -




(h) Assets (Continued)

(iii) Revaluation of Property, Plant and Equipment (Continued)

Non-specialised assets with short useful lives are measured at depreciated historical cost, as an approximation of fairvalue.

When revaluing assets, any balances of accumulated depreciation at the revaluation date in respect of those assets are credited to the asset accounts to which they relate. The net asset accounts are then increased or decreased by the revaluation increments or decrements.

Revaluation increments are credited directly to revaluation reserve, except that, to the extent that an increment reverses a revaluation decrement in respect of that class of asset previously recognised as an expense in the net result, theincrement is recognised immediately as revenue in the net result.

Revaluation decrements are recognised immediately as expenses in the net result, except that, to the extent that a credit balance exists in the revaluation reserve in respect of the same class of assets, they are debited directly to the revaluation reserve.

As a not-for-profit entity, revaluation increments and decrements are offset against one another within a class of non-current assets, but not otherwise.

Where an asset that has previously been revalued is disposed of, any balance remaining in the revaluation reservein respect of that asset is transferred to accumulated funds.

(iv) Impairment of Property, Plant and Equipment

As a not-for-profit entity with no cash generating units, impairment under AASB 136 "Impairment of Assets" is unlikelyto arise. As property, plant and equipment is carried at fair value, impairment can only arise in the rare circumstanceswhere the costs of disposal are material. Specifically, impairment is unlikely for not-for-profit entities given that AASB136 modifies the recoverable amount test for non-cash generating assets of not-for-profit entities to the higher of fairvalue less costs of disposal and depreciated replacement cost, where depreciated replacement cost is also fair value.

(v) Depreciation of Property, Plant and Equipment

Depreciation is provided for on a straight-line basis for all depreciable non-current assets so as to write off thedepreciable amount of each asset as it is consumed over its useful life to GPNSW. Estimates of remaining usefullives are made on a regular basis for all assets, with annual reassessments for major items.

GPNSW's buildings are separately componentised into the structure, air conditioning units and lifts where it canbe determined that these components:

(a) physically exist; and(b) are material enough to justify separate tracking; and(c) are capable of having a reliable value attributed to them; and(d) have differing estimated useful lives to the extent that failure to depreciate them separately would result in a material difference in the annual depreciation expense for GPNSW.


50

- 9 -





(v) Depreciation of Property, Plant and Equipment (Continued)

The starting useful lives of GPNSW's items of property, plant and equipment are based on the following:

2016 2015Years Years

Buildings (Not Componentised) 40 40Buildings (Componentised)

Structure 40 40Air Conditioning Units 20 20Lifts 30 30

Computer Equipment and Software 3 3Furniture and Fittings 10 10Plant and Equipment and Office Equipment 5 5Leasehold Improvements 6 6

Leasehold Improvements are depreciated over the shorter of the lease term and their useful life. Heritage buildings aredepreciated in accordance with the above useful life ranges. Finance Lease Assets are amortised over the period of thelease. Fine Arts and Heritage items located within owned buildings are not depreciated as they do not have a limiteduseful life. These items are however subject to an annual impairment test to identify any impairment.

In accordance with AASB 5 "Non-current Assets Held for Sale and Discontinued Operations", any assets held for saleare not depreciated. Land is also not depreciated as land is not a depreciable asset.

(vi) Restoration Costs

The estimated cost of dismantling and removing an asset and restoring the site is included in the cost of an asset, to the extent it is recognised as a liability.

(vii) Maintenance

Day-to-day servicing costs or maintenance are charged as expenses as incurred, except where they relate to thereplacement of a part or component of an asset, in which case the costs are capitalised and depreciated.

(viii) Leased Assets

A distinction is made between finance leases, which effectively transfer from the lessor to the lessee substantially all the risks and benefits incidental to ownership of the leased assets, and operating leases under which the lessor effectively retains all such risks and benefits.

(a) Finance Leases

Assets held under finance leases as lessee are recognised on inception at an amount equal to the fair value of theleased property, or if lower, the present value of the minimum lease payments. The corresponding liability to the lessoris included in the Statement of Financial Position as Finance Lease Liabilities under Borrowings (Note 14). Leasepayments are allocated between the principal component of the lease liability and the interest expense.

Finance leases as lessor in which substantially all the risks and rewards incidental to legal ownership are transferredby GPNSW to the lessee, are classified in the Statement of Financial Position as Finance Lease Receivablesunder Receivables (Note 7(b)). Assets held under a finance lease arrangement are presented as a receivable at anamount equal to the net investment in the lease. Lessee finance lease payments are treated by GPNSW asrepayment of principal and finance income over the lease term to reimburse and reward GPNSW’s investment andservices. Lease payments relating to the period, excluding costs for services, are applied against the gross investmentin the lease to reduce both the principal and the unearned finance income.


51

- 9 -





(v) Depreciation of Property, Plant and Equipment (Continued)

The starting useful lives of GPNSW's items of property, plant and equipment are based on the following:

2016 2015Years Years

Buildings (Not Componentised) 40 40Buildings (Componentised)

Structure 40 40Air Conditioning Units 20 20Lifts 30 30

Computer Equipment and Software 3 3Furniture and Fittings 10 10Plant and Equipment and Office Equipment 5 5Leasehold Improvements 6 6

Leasehold Improvements are depreciated over the shorter of the lease term and their useful life. Heritage buildings aredepreciated in accordance with the above useful life ranges. Finance Lease Assets are amortised over the period of thelease. Fine Arts and Heritage items located within owned buildings are not depreciated as they do not have a limiteduseful life. These items are however subject to an annual impairment test to identify any impairment.

In accordance with AASB 5 "Non-current Assets Held for Sale and Discontinued Operations", any assets held for saleare not depreciated. Land is also not depreciated as land is not a depreciable asset.

(vi) Restoration Costs

The estimated cost of dismantling and removing an asset and restoring the site is included in the cost of an asset, to the extent it is recognised as a liability.

(vii) Maintenance

Day-to-day servicing costs or maintenance are charged as expenses as incurred, except where they relate to thereplacement of a part or component of an asset, in which case the costs are capitalised and depreciated.

(viii) Leased Assets

A distinction is made between finance leases, which effectively transfer from the lessor to the lessee substantially all the risks and benefits incidental to ownership of the leased assets, and operating leases under which the lessor effectively retains all such risks and benefits.

(a) Finance Leases

Assets held under finance leases as lessee are recognised on inception at an amount equal to the fair value of theleased property, or if lower, the present value of the minimum lease payments. The corresponding liability to the lessoris included in the Statement of Financial Position as Finance Lease Liabilities under Borrowings (Note 14). Leasepayments are allocated between the principal component of the lease liability and the interest expense.

Finance leases as lessor in which substantially all the risks and rewards incidental to legal ownership are transferredby GPNSW to the lessee, are classified in the Statement of Financial Position as Finance Lease Receivablesunder Receivables (Note 7(b)). Assets held under a finance lease arrangement are presented as a receivable at anamount equal to the net investment in the lease. Lessee finance lease payments are treated by GPNSW asrepayment of principal and finance income over the lease term to reimburse and reward GPNSW’s investment andservices. Lease payments relating to the period, excluding costs for services, are applied against the gross investmentin the lease to reduce both the principal and the unearned finance income.

- 10 -





(viii) Leased Assets (Continued)

(b) Operating Leases

Operating lease payments are recognised in the Net Result and charged on a straight-line basis over the lease term.Lease incentives received which are less than $0.5 million are recognised directly in the Net Result in the year in whichthey are received. Lease incentives received which are greater than this amount are recognised in the Statement ofFinancial Position and are allocated to the Net Result over the lease term (Notes 16(a) and 2(b)).

In accordance with AASB 137 "Provisions, Contingent Liabilities and Contingent Assets", in the case of an onerouscontract, the present obligation under the contract is recognised and measured as a provision.

The terms of occupancy for government agencies occupying space in GPNSW owned premises is dictated in theMemorandum of Understanding (MoU) between GPNSW and the agency. The provisions of the MoU are generallybased on market place conditions applicable to office buildings in commercial centres.

The term of the tenancy agreement is indefinite with the agency required to give 18 months notice prior to vacating.Termination of part tenancies is permitted subject to a variety of conditions being satisfied.

Rent reviews for owned government office buildings are conducted at two yearly intervals to update rentals to currentmarket rates. There are no ratchet clauses in place and tenants are charged an effective rental, which takes intoconsideration incentives available in the market place at a particular point in time.

Tenants will makegood the premises by undertaking a physical makegood or negotiating a financial settlement withGPNSW.

(ix) Intangible Assets

GPNSW recognises intangible assets only if it is probable that future economic benefits will flow to GPNSW and the cost of the asset can be measured reliably. Intangible assets are measured initially at cost. Where an asset is acquired at no or nominal cost, the cost is its fair value as at the date of acquisition.

All research costs are expensed. Development costs are only capitalised when certain criteria are met.

The useful lives of intangible assets are assessed to be finite.

Intangible assets are subsequently measured at fair value only if there is an active market. As there is no active market for GPNSW’s intangible assets, the assets are carried at cost less any accumulated amortisation.

GPNSW's intangible assets (computer software) are amortised using the straight-line method over a period of three (3)years.

Intangible assets are tested for impairment where an indicator of impairment exists. If the recoverable amount is lessthan its carrying amount, the carrying amount is reduced to recoverable amount and the reduction is recognised as an impairment loss.

(x) Cash and Cash Equivalents

Cash and short-term deposits in the Statement of Financial Position comprise cash at bank and in hand, restrictedcash and other short-term deposits with an original maturity of three months or less.

For the purpose of the Statement of Cash Flows, cash and cash equivalents consist of cash and cash equivalents asdefined above, net of outstanding bank overdrafts.


52

- 11 -





(xi) Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in anactive market. These financial assets are recognised initially at fair value, usually based on the transaction cost or facevalue. Subsequent measurement is an amortised cost using the effective interest method, less an allowance for anyimpairment of receivables. Any changes are recognised in the Net Result when impaired, derecognised orthrough the amortisation process.

Short-term receivables with no stated interest rate are measured at the original invoice amount where the effect ofdiscounting is immaterial. Such receivables, which generally have 30-day terms, are recognised and carried at originalinvoice amount less an allowance for any uncollectible amounts.

(xii) Impairment of Financial Assets

All financial assets, except those measured at fair value through profit and loss, are subject to an annual review for impairment. An allowance for impairment is established when there is objective evidence that GPNSW will not be able to collect all amounts due.

For financial assets carried at amortised cost, the amount of the allowance is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the impairment loss is recognised in the Net Result for the year.

Any reversals of impairment losses are reversed through the Net Result for the year, where there is objective evidence.Reversals of impairment losses of financial assets carried at amortised cost cannot result in a carrying amount that exceeds what the carrying amount would have been had there not been an impairment loss.

(xiii) Derecognition of Financial Assets and Financial Liabilities

A financial asset is derecognised when the contractual rights to the cash flows from the financial assets expire or ifGPNSW transfers the financial asset:- where substantially all the risks and rewards have been transferred; or- where GPNSW has not transferred substantially all the risks and rewards, if GPNSW has not retained control.

Where GPNSW has neither transferred nor retained substantially all the risks and rewards or transferred control, the asset is recognised to the extent of GPNSW’s continuing involvement in the asset.

A financial liability is derecognised when the obligation specified in the contract is discharged or cancelled or expires.

(xiv) Non-Current Assets Held for Sale

GPNSW has certain non-current assets classified as held for sale, where their carrying amount will be recovered principally through a sale transaction, not through continuing use. Non-Current Assets Held for Sale are recognised at the lower of carrying amount and fair value less costs to sell. These assets are not depreciated while they are classified as held for sale.

(xv) Other Assets

Other assets are recognised on a cost basis.

(xvi) Investment Properties

Investment property is held to earn rentals or for capital appreciation, or both. However, for not-for-profit entities, propertyheld to meet service delivery objectives rather than to earn rental or for capital appreciation does not meet the definition ofinvestment property and is accounted for under AASB 116, Property, Plant and Equipment. GPNSW does not have anyproperty that meets the definition of Investment Property.


53

- 11 -





(xi) Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in anactive market. These financial assets are recognised initially at fair value, usually based on the transaction cost or facevalue. Subsequent measurement is an amortised cost using the effective interest method, less an allowance for anyimpairment of receivables. Any changes are recognised in the Net Result when impaired, derecognised orthrough the amortisation process.

Short-term receivables with no stated interest rate are measured at the original invoice amount where the effect ofdiscounting is immaterial. Such receivables, which generally have 30-day terms, are recognised and carried at originalinvoice amount less an allowance for any uncollectible amounts.

(xii) Impairment of Financial Assets

All financial assets, except those measured at fair value through profit and loss, are subject to an annual review for impairment. An allowance for impairment is established when there is objective evidence that GPNSW will not be able to collect all amounts due.

For financial assets carried at amortised cost, the amount of the allowance is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the impairment loss is recognised in the Net Result for the year.

Any reversals of impairment losses are reversed through the Net Result for the year, where there is objective evidence.Reversals of impairment losses of financial assets carried at amortised cost cannot result in a carrying amount that exceeds what the carrying amount would have been had there not been an impairment loss.

(xiii) Derecognition of Financial Assets and Financial Liabilities

A financial asset is derecognised when the contractual rights to the cash flows from the financial assets expire or ifGPNSW transfers the financial asset:- where substantially all the risks and rewards have been transferred; or- where GPNSW has not transferred substantially all the risks and rewards, if GPNSW has not retained control.

Where GPNSW has neither transferred nor retained substantially all the risks and rewards or transferred control, the asset is recognised to the extent of GPNSW’s continuing involvement in the asset.

A financial liability is derecognised when the obligation specified in the contract is discharged or cancelled or expires.

(xiv) Non-Current Assets Held for Sale

GPNSW has certain non-current assets classified as held for sale, where their carrying amount will be recovered principally through a sale transaction, not through continuing use. Non-Current Assets Held for Sale are recognised at the lower of carrying amount and fair value less costs to sell. These assets are not depreciated while they are classified as held for sale.

(xv) Other Assets

Other assets are recognised on a cost basis.

(xvi) Investment Properties

Investment property is held to earn rentals or for capital appreciation, or both. However, for not-for-profit entities, propertyheld to meet service delivery objectives rather than to earn rental or for capital appreciation does not meet the definition ofinvestment property and is accounted for under AASB 116, Property, Plant and Equipment. GPNSW does not have anyproperty that meets the definition of Investment Property.

- 12 -




(i) Liabilities

(i) Payables

These amounts represent liabilities for goods and services provided to GPNSW and other amounts. Payables arerecognised initially at fair value, usually based on the transaction cost or face value. Subsequent measurement is atamortised cost using the effective interest method. Short-term payables with no stated interest rate are measured atthe original invoice amount where the effect of discounting is immaterial.

(ii) Borrowings

GPNSW's borrowings represent finance lease liabilities. The finance lease liabilities are determined in accordance withAASB 117 "Leases".

(iii) Provisions

(a) Personnel Services Provision

GPNSW receives personnel services from the Department of Finance, Services and Innovation (DFSI). The DFSI is nota Special Purpose Service Entity and does not control GPNSW under this arrangement (Note 1(a)). As GPNSW is notan employer, the disclosure requirements of AASB 119 "Employee Benefits" in respect of employee benefits do notapply. However, for clarity and transparency, a Personnel Services Provision is disclosed in the notes to the financialstatements where the substance of the underlying liability effectively represents employee benefits (Note 15(a)).

(b) Land Remediation Provision

Where GPNSW has a legal or constructive obligation to remediate an asset such as land, a provision is recognised toreflect the net present value of the estimated future costs required to settle GPNSW's remediation obligations (Note15(b)). At the same time, where GPNSW owns the underlying asset, the amount of the provision is capitalised andadded to the cost of the asset.

Periodic changes in the provision are accounted for in accordance with the requirements of AASB Interpretation 1"Changes in Existing Decommissioning, Restoration and Similar Liabilities" and the revaluation model requirements ofAASB 116 "Property, Plant and Equipment" for not-for-profit entities.

The discount applied to recognise the time value of money is unwound over the life of the provision. Any incrementalincrease resulting from the unwinding of the discount is recognised under Finance Costs within the Net Resultin the reporting period in which it occurs.

Other increases or decreases in the provision resulting from periodic changes to the estimated timing or amount offuture remediation costs, or changes to the discount rate used, alter the revaluation increase or decrease previouslyrecognised on the underlying asset. An increase in the provision is recognised in the Net Result except to theextent that it reverses any Asset Revaluation Reserve balance in respect of the underlying class of assets. A decreasein the provision is credited to the Asset Revaluation Reserve except to the extent that it reverses any previous increaserecognised in the Net Result in respect the underlying class of assets. Any changes to the Asset RevaluationReserve resulting from these provision increases or decreases are separately identified and disclosed within OtherComprehensive Income.

(c) Other Provisions

Other provisions are recognised when GPNSW has a present legal or constructive obligation as a result of a past event, itis probable that an outflow of resources will be required to settle the obligation and a reliable estimate can be made of theamount of the obligation. The amount recognised as a provision is the best estimate of the expenditure required to settlethe present obligation as at the reporting date, taking into account the risks and uncertainties that surround the events andcircumstances that affect the provision. Where the effect of the time value of money is material, the provision amount iscalculated as the present value of the expenditure expected to be required to settle the obligation. The discount rate usedin the calculation is a pre-tax rate that reflects current market assessments of the time value of money and the risksspecific to the liability. The rate does not reflect risks for which future cash flow estimates have been adjusted.


54

- 13 -




(j) Fair Value Hierarchy

A number of GPNSW’s accounting policies and disclosures require the measurement of fair values, for both financial andnon-financial assets and liabilities. When measuring fair value, the valuation technique used maximises the use of relevantobservable inputs and minimises the use of unobservable inputs. Under AASB 13 "Fair Value Measurement", GPNSWcategorises, for disclosure purposes, the valuation techniques based on the inputs used in the valuation techniques asfollows:

- Level 1 – quoted prices in active markets for identical assets / liabilities that the entity can access at the measurement date.- Level 2 – inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly.- Level 3 – inputs that are not based on observable market data (unobservable inputs).

GPNSW recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which thechange has occurred. Refer to Note 12 and Note 20 for further disclosures regarding fair value measurements of financialand non-financial assets.

(k) Equity and Reserves

(i) Accumulated Funds

The category "Accumulated Funds" includes all current and prior period retained funds. All financial distributions aremade directly from Accumulated Funds.

(ii) Asset Revaluation Reserve

The total asset revaluation reserve is used to record increments and decrements on the revaluation of non-currentproperty plant and equipment and finance leases. This accords with GPNSW's policy on the Revaluation ofProperty, Plant and Equipment (Note 1(h)(iii)). No financial distributions are made from the Asset Revaluation Reserve.

(l) Financial Distributions

As a Government business, GPNSW operates under the State Government's Commercial Policy Framework. A keycomponent of this Framework is the requirement to make financial distributions to owners. In GPNSW's case, its owner is theState Government. All payments of financial distributions are made to the Crown Finance Entity. The nature and calculation ofthe required annual distributions is determined by NSW Treasury Policy and Guidelines Paper, TPP 14-04 "FinancialDistribution Policy for Government Businesses". The distributions made by GPNSW include normal distribution payments fromcash operating surpluses and capital repatriations, from the sale of its own properties.

Normal distributions are payments made from current year cash surpluses. Treasury policy states that a governmentbusiness should not retain any cash in excess of its requirements for working capital, in addition to a contingency allowancefor an appropriate level of financial flexibility. Funds in excess of these requirements are returned to the State Government.

Capital repatriations are additional one-off payments which represent capital repayments of the State Government’s equityin GPNSW. In GPNSW’s case, capital repatriation payments represent the full return of the net proceeds (ie. total proceedsless costs) of all GPNSW-owned property sales (Note 17(a)).

(m) Equity Transfers

The establishment of new statutory bodies or transfer of net assets between agencies as a result of an administrativerestructure, transfers of programs/functions and parts thereof between NSW public sector agencies are designated as acontribution by owners and recognised as an adjustment to Accumulated Funds. This treatment is in accordance withTreasury Policy and Guidelines Paper TPP 09-3 "Contributions By Owners Made to Wholly-Owned Public Sector Entities" andis consistent with Interpretation 1038 "Contributions by Owners Made to Wholly-Owned Public Sector Entities" and AustralianAccounting Standards. Transfers arising from an administrative restructure between government agencies are recognised atthe amount at which the asset was recognised by the transferor government agency immediately prior to the restructure. Inmost cases this will approximate fair value. All other equity transfers are recognised at fair value.


55

- 13 -




(j) Fair Value Hierarchy

A number of GPNSW’s accounting policies and disclosures require the measurement of fair values, for both financial andnon-financial assets and liabilities. When measuring fair value, the valuation technique used maximises the use of relevantobservable inputs and minimises the use of unobservable inputs. Under AASB 13 "Fair Value Measurement", GPNSWcategorises, for disclosure purposes, the valuation techniques based on the inputs used in the valuation techniques asfollows:

- Level 1 – quoted prices in active markets for identical assets / liabilities that the entity can access at the measurement date.- Level 2 – inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly.- Level 3 – inputs that are not based on observable market data (unobservable inputs).

GPNSW recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which thechange has occurred. Refer to Note 12 and Note 20 for further disclosures regarding fair value measurements of financialand non-financial assets.

(k) Equity and Reserves

(i) Accumulated Funds

The category "Accumulated Funds" includes all current and prior period retained funds. All financial distributions aremade directly from Accumulated Funds.

(ii) Asset Revaluation Reserve

The total asset revaluation reserve is used to record increments and decrements on the revaluation of non-currentproperty plant and equipment and finance leases. This accords with GPNSW's policy on the Revaluation ofProperty, Plant and Equipment (Note 1(h)(iii)). No financial distributions are made from the Asset Revaluation Reserve.

(l) Financial Distributions

As a Government business, GPNSW operates under the State Government's Commercial Policy Framework. A keycomponent of this Framework is the requirement to make financial distributions to owners. In GPNSW's case, its owner is theState Government. All payments of financial distributions are made to the Crown Finance Entity. The nature and calculation ofthe required annual distributions is determined by NSW Treasury Policy and Guidelines Paper, TPP 14-04 "FinancialDistribution Policy for Government Businesses". The distributions made by GPNSW include normal distribution payments fromcash operating surpluses and capital repatriations, from the sale of its own properties.

Normal distributions are payments made from current year cash surpluses. Treasury policy states that a governmentbusiness should not retain any cash in excess of its requirements for working capital, in addition to a contingency allowancefor an appropriate level of financial flexibility. Funds in excess of these requirements are returned to the State Government.

Capital repatriations are additional one-off payments which represent capital repayments of the State Government’s equityin GPNSW. In GPNSW’s case, capital repatriation payments represent the full return of the net proceeds (ie. total proceedsless costs) of all GPNSW-owned property sales (Note 17(a)).

(m) Equity Transfers

The establishment of new statutory bodies or transfer of net assets between agencies as a result of an administrativerestructure, transfers of programs/functions and parts thereof between NSW public sector agencies are designated as acontribution by owners and recognised as an adjustment to Accumulated Funds. This treatment is in accordance withTreasury Policy and Guidelines Paper TPP 09-3 "Contributions By Owners Made to Wholly-Owned Public Sector Entities" andis consistent with Interpretation 1038 "Contributions by Owners Made to Wholly-Owned Public Sector Entities" and AustralianAccounting Standards. Transfers arising from an administrative restructure between government agencies are recognised atthe amount at which the asset was recognised by the transferor government agency immediately prior to the restructure. Inmost cases this will approximate fair value. All other equity transfers are recognised at fair value.

- 14 -




(n) Budgeted Amounts

The budgeted amounts are drawn from the original budgeted financial statements presented to Parliament in respect of thereporting period. Subsequent amendments to the original budget (e.g. adjustment for transfer of functions between entitiesas a result of administrative arrangements orders) are not reflected in the budgeted amounts. Major variances between theoriginal budgeted amounts and the actual amounts disclosed in the primary financial statements are explained in Note 21.

(o) Comparative Information

Except when an Australian Accounting Standard permits or requires otherwise, comparative information is disclosed in respect of the previous period for all amounts reported in the financial statements.

(p) Changes in Accounting Policy, including New or Revised Australian Accounting Standards

(i) Effective for the First Time in 2015-16

The accounting policies applied in 2015-16 are consistent with those of the previous financial year. The following revisedAustralian Accounting Standards were applied for the first time in 2015-16:

- AASB 2013-9 (Part C), AASB 2014-1 (Part E) and AASB 2014-8 regarding amendments to AASB 9 "Financial Instruments"- AASB 2015-3 regarding withdrawal of AASB 1031 "Materiality"- AASB 2015-4 regarding amendments to AASB 128 "Investments in Associates and Joint Ventures"

There was no material impact on the financial statements of GPNSW from these Standards in the period of initialapplication.

(ii) Issued but Not Yet Effective

NSW public sector entities are not permitted to early adopt new Australian Accounting Standards, unless Treasury determines otherwise. There are a number of recently issued or amended Australian Accounting Standards which arenot yet effective and have not been adopted for the reporting period ending 30 June 2016. Management has reviewedeach of these Standards and considers that their early adoption will not have any material impact on the financialstatements of GPNSW except for:

- AASB 124 "Related Party Disclosures", has application from 1 July 2016. The amended standard requiresGPNSW, a not-for-profit entity, to disclose material transactions and outstanding balances between GPNSW and itsrelated parties. The definition of a "related party" in AASB 124 is extensive and it includes close famility members ofindividuals in related party relationships. Key Management Personnel (KMP) are related parties with separatedisclosure requirements.

- AASB 15 and AASB 2014-5 "Revenue from Contracts with Customers", has application from 1 January 2018. GPNSW believes this standard will impact on the timing recognition of certain revenues given the core principle of thenew standard requires revenue to be recognised when the goods or services are transferred to the customer at thetransaction price (as opposed to stage of completion of the transaction). The model features a contract-based five stepanalysis of transactions to determine whether, how much and when revenue is recognised.

- AASB 16 "Leases", has application from 1 January 2019. This standard generally requires Lessee to recognise aright-of-use asset and a lease liability at a lease's commencement date. GPNSW believes this standard willsignificantly increase the value of GPNSW's total assets and liabilities and affect the composition of GPNSW's revenueand expenses. At 30 June 2016, GPNSW was unable to quantify the significant financial impact from the applicationof this standard.


56

- 15 -



2. EXPENSES EXCLUDING LOSSES 2016 2015$'000 $'000

(a) Personnel Services Expense (i)Salaries and Wages (Including Recreation Leave) 14,652 11,601Contractors 5,803 4,965Voluntary Redundancies 2,641 351Superannuation (Defined Benefit Plans) (ii) 61 227Superannuation (Defined Contribution Plans) 928 792Long Service Leave 586 204Worker's Compensation Insurance 55 55Payroll Tax and Fringe Benefits Tax 946 698

25,672 18,893

(i) The Personnel Services Expense is the expense incurred by GPNSW on personnel services provided to it by theDepartment of Finance, Services and Innovation (DFSI). Under the Government Property NSW Act 2006, GPNSW isunable to employ staff (Note 1(a)).

(ii) The Superannuation (Defined Benefits Plans) expense in 2014-15 included a net decrease of $0.1 million in theunfunded liability at 30 June 2015 in respect of personnel who are members of these Plans (Note 15(a)(i)). Thisdecrease included net gains of $0.7 million in 2014-15 related to a combination of actuarial losses and actual return onfund assets, less interest income. The decrease is recognised directly in the Net Result under Personnel ServicesExpense.

(b) Other Operating Expenses 2016 2015$'000 $'000

Property Head Lease Expense (i) 434,409 416,245Other Property Related Expenses (ii) 26,200 28,045Other Operating Expenses (iii) 10,810 10,845

471,419 455,135

(i) Property Head Lease Expense 2016 2015$'000 $'000

Minimum Lease Payments (a) 365,798 341,074Rental Expenses Arising from Sub-Leases (b) 65,119 65,273Contingent Rentals (c) 12,719 19,194

443,636 425,541Less Amortisation of Lessor Lease Incentives (Note 16(a)) (9,227) (9,296)

434,409 416,245

(a) The majority of head leased office accommodation property is sub-leased to government agencies. The terms ofthe operating head leases generally range from 3 to 15 years with the option of renewal of further terms. The leaseagreements allow Lessors the right to review rents on specified dates.

(b) Expenditure for recurrent outgoings on property leased by GPNSW as lessee includes maintenance, electricity,cleaning and expenses for common areas and public risk. This is recovered from sub-lessees.

(c) Contingent rentals are variations due to market rental reviews and changes to the Consumer Price Index betweenthe actual lease and the amounts of minimum lease payments determined at the inception of the lease.


57

- 15 -



2. EXPENSES EXCLUDING LOSSES 2016 2015$'000 $'000

(a) Personnel Services Expense (i)Salaries and Wages (Including Recreation Leave) 14,652 11,601Contractors 5,803 4,965Voluntary Redundancies 2,641 351Superannuation (Defined Benefit Plans) (ii) 61 227Superannuation (Defined Contribution Plans) 928 792Long Service Leave 586 204Worker's Compensation Insurance 55 55Payroll Tax and Fringe Benefits Tax 946 698

25,672 18,893

(i) The Personnel Services Expense is the expense incurred by GPNSW on personnel services provided to it by theDepartment of Finance, Services and Innovation (DFSI). Under the Government Property NSW Act 2006, GPNSW isunable to employ staff (Note 1(a)).

(ii) The Superannuation (Defined Benefits Plans) expense in 2014-15 included a net decrease of $0.1 million in theunfunded liability at 30 June 2015 in respect of personnel who are members of these Plans (Note 15(a)(i)). Thisdecrease included net gains of $0.7 million in 2014-15 related to a combination of actuarial losses and actual return onfund assets, less interest income. The decrease is recognised directly in the Net Result under Personnel ServicesExpense.

(b) Other Operating Expenses 2016 2015$'000 $'000

Property Head Lease Expense (i) 434,409 416,245Other Property Related Expenses (ii) 26,200 28,045Other Operating Expenses (iii) 10,810 10,845

471,419 455,135

(i) Property Head Lease Expense 2016 2015$'000 $'000

Minimum Lease Payments (a) 365,798 341,074Rental Expenses Arising from Sub-Leases (b) 65,119 65,273Contingent Rentals (c) 12,719 19,194

443,636 425,541Less Amortisation of Lessor Lease Incentives (Note 16(a)) (9,227) (9,296)

434,409 416,245

(a) The majority of head leased office accommodation property is sub-leased to government agencies. The terms ofthe operating head leases generally range from 3 to 15 years with the option of renewal of further terms. The leaseagreements allow Lessors the right to review rents on specified dates.

(b) Expenditure for recurrent outgoings on property leased by GPNSW as lessee includes maintenance, electricity,cleaning and expenses for common areas and public risk. This is recovered from sub-lessees.

(c) Contingent rentals are variations due to market rental reviews and changes to the Consumer Price Index betweenthe actual lease and the amounts of minimum lease payments determined at the inception of the lease.

- 16 -



2. EXPENSES EXCLUDING LOSSES (CONTINUED)

(b) Other Operating Expenses (Continued)

(ii) Other Property Related Expenses 2016 2015$'000 $'000

Management Fees 7,124 7,590Gas and Electricity 2,236 3,250Maintenance (a) 7,737 7,011Cleaning 2,525 2,626Rates and Levies 193 269Security 882 899Valuations 268 635Bad Debts 43 213Other (b) 5,192 5,552

26,200 28,045

(a) Maintenance expenses relate to owned properties and include ad-hoc and scheduled maintenance services onlifts, air conditioning units, fire protection systems, plumbing, electrical and other areas. There was no personnelservices maintenance expense in 2015-16 (nil in 2014-15).

(b) Items classified as Other include telephone, fire safety, legal, building manager costs, gardening and sundrycharges incurred on properties owned by GPNSW.

(iii) Other Operating Expenses 2016 2015$'000 $'000

Audit Fees (Audit of Financial Statements) 198 194Legal Fees 164 60Consultants 253 1,436Office Accommodation Expenses 2,290 1,818Other Contractors 2,119 1,733Service Fees (a) 3,883 3,970Other (b) 1,903 1,634

10,810 10,845

(a) Service Fees include fees charged by GovConnectNSW for shared transactional services, by DFSI for corporateservices provided under the DFSI Corporate Operating Model arrangements and by Land and Property Information forsystem hosting services provided in relation to the Government Property Register.

(b) Items classified as Other include advertising, training, conferences, computer costs, telephone, printing, stationery,travel, removal and other sundry charges.

(c) Depreciation and Amortisation 2016 2015$'000 $'000

Depreciation of Property, Plant and Equipment (Note 8(b)) 8,911 13,705Depreciation of Finance Lease Assets (Note 8(b)) 2,839 2,424Amortisation of Intangible Assets (Note 10(b)) 1,138 612

12,888 16,741


58

- 17 -




(d) Grants and Subsidies 2016 2015$'000 $'000

Grants to Other Government Agencies (i) - 4,530Contributions to the Restart NSW Fund (ii) 200,202 -Land Grants to Local Government (Note 8(b)) 495 -

200,697 4,530

(i) Grants of $4.5 million in 2014-15 represent payments made to various government agencies for office relocation costsunder the Government's CBD Backfill Strategy.

(ii) Contributions of $200.2 million in 2015-16 (nil in 2014-15) represent payments made to the Restart NSW Fund (NSWGovernment's dedicated infrastructure fund) from the net sale proceeds of property assets sold by GPNSW. Thepayments are based on a NSW Government decision that the net sale proceeds of property assets sold by DFSIrelated entities are to be paid directly into the Restart NSW Fund from 1 July 2015 onward except where the NSWGovernment has made a separate decision to allocate the net sale proceeds to fund other programs. The payments of$200.2 million in 2015-16 include $169.9 million of net sale proceeds from properties settled in late June 2015.

(e) Finance Costs 2016 2015$'000 $'000

Finance Lease Interest Charges (Note 14(a)) 4,929 5,015Unwinding of Discount Rate on Make Good Provision (Note 15(c)) 7 12Unwinding of Discount Rate on Land Remediation Provision (Note 15(b)) 1,405 1,333

6,341 6,360

3. REVENUE 2016 2015$'000 $'000

(a) Sale of Goods and Services

Property Rental Income - Operating Lease Income (i) 486,734 482,179Fees for Services Rendered 10,460 2,889

497,194 485,068

The significant increase in fees for services revenue over 2014-15 has resulted mainly from increase in external propertydivestment activities and implementation of new leasing fees arrangement in 2015-16.

2016 2015(i) Property Rental Income - Operating Lease Income $'000 $'000

Owned Property Income 40,728 55,551Leased Property Income 455,233 435,649Less: Amortisation of Lessee Lease Incentives (Note 7(c)) (9,227) (9,021)

486,734 482,179

Future Minimum Lease Receipts under Non-Cancellable Operating Leases as Lessor

Receivable within one year 43,039 41,191Receivable later than 1 year but not later than 5 years 22,045 21,231Receivable later than 5 years 778 934Total Including GST 65,862 63,356

The above represents future minimum lease receipts on GPNSW's owned properties. Future minimum lease receiptsas at 30 June 2016 include GST payable of $6.0 million ($5.7m at 30 June 2015).


59

- 17 -




(d) Grants and Subsidies 2016 2015$'000 $'000

Grants to Other Government Agencies (i) - 4,530Contributions to the Restart NSW Fund (ii) 200,202 -Land Grants to Local Government (Note 8(b)) 495 -

200,697 4,530

(i) Grants of $4.5 million in 2014-15 represent payments made to various government agencies for office relocation costsunder the Government's CBD Backfill Strategy.

(ii) Contributions of $200.2 million in 2015-16 (nil in 2014-15) represent payments made to the Restart NSW Fund (NSWGovernment's dedicated infrastructure fund) from the net sale proceeds of property assets sold by GPNSW. Thepayments are based on a NSW Government decision that the net sale proceeds of property assets sold by DFSIrelated entities are to be paid directly into the Restart NSW Fund from 1 July 2015 onward except where the NSWGovernment has made a separate decision to allocate the net sale proceeds to fund other programs. The payments of$200.2 million in 2015-16 include $169.9 million of net sale proceeds from properties settled in late June 2015.

(e) Finance Costs 2016 2015$'000 $'000

Finance Lease Interest Charges (Note 14(a)) 4,929 5,015Unwinding of Discount Rate on Make Good Provision (Note 15(c)) 7 12Unwinding of Discount Rate on Land Remediation Provision (Note 15(b)) 1,405 1,333

6,341 6,360

3. REVENUE 2016 2015$'000 $'000

(a) Sale of Goods and Services

Property Rental Income - Operating Lease Income (i) 486,734 482,179Fees for Services Rendered 10,460 2,889

497,194 485,068

The significant increase in fees for services revenue over 2014-15 has resulted mainly from increase in external propertydivestment activities and implementation of new leasing fees arrangement in 2015-16.

2016 2015(i) Property Rental Income - Operating Lease Income $'000 $'000

Owned Property Income 40,728 55,551Leased Property Income 455,233 435,649Less: Amortisation of Lessee Lease Incentives (Note 7(c)) (9,227) (9,021)

486,734 482,179

Future Minimum Lease Receipts under Non-Cancellable Operating Leases as Lessor

Receivable within one year 43,039 41,191Receivable later than 1 year but not later than 5 years 22,045 21,231Receivable later than 5 years 778 934Total Including GST 65,862 63,356

The above represents future minimum lease receipts on GPNSW's owned properties. Future minimum lease receiptsas at 30 June 2016 include GST payable of $6.0 million ($5.7m at 30 June 2015).

- 18 -



3. REVENUE (CONTINUED)

(b) Investment Revenue 2016 2015$'000 $'000

Property Finance Lease Income ((i) and Note 7(b)) 5,547 5,218Interest Earned (ii) 795 912

6,342 6,130

(i) Income from finance leases as lessor includes contingent rent of $0.8 million in 2015-16 ($0.5m in 2014-15). Contingentrent is calculated as the difference between the current lease payments and the minimum lease payments which weredetermined at the initial recognition of the finance lease arrangement.

(ii) Interest earned is received on cash set aside for remediation on land acquired by the Crown from BHP Billiton in 2002.The cash is held in a separate GPNSW bank account within the NSW Treasury Banking System.

(c) Grants and Contributions 2016 2015$'000 $'000

State Government - Recurrent Contribution (i) 5,668 10,658State Government - Capital Contribution (ii) 20,573 6,812

26,241 17,470

(i) GPNSW receives an annual recurrent contribution from the State Government for a range of non-commercialprofessional services undertaken which provide a whole-of-government benefit. These services include agency propertyportfolio reviews, whole-of-town studies, property policy implementation and Government Property Registeradministration.

(ii) GPNSW's approved Capital Program is fully funded by the State Government by way an annual capital contribution.The Program includes major works such as refurbishment, compliance and other asset renewal works included underGPNSW's Property Refurbishment Program.

(d) Other Revenue 2016 2015$'000 $'000

Emerging Asset Revenue ((i) and Note 11) 550 500550 500

(i) In accordance with TPP 06-08 "Accounting for Privately Financed Projects", the Opera House Car Park is an emergingasset which GPNSW has a right to receive in 2043 under a privately financed infrastructure arrangement. The rightis being recognised as revenue and added to the asset value over the term of the carpark concession (Note 11).

4. GAIN/(LOSS) ON DISPOSAL 2016 2015$'000 $'000

Net Proceeds from Disposal of Property, Plant and Equipment and Non-Current Assets Held for Sale 89,707 218,837Written Down Value (Note 8(b) and 9(b)) (88,239) (190,573)Net Gain/(Loss) on Disposal 1,468 28,264


60

- 19 -



5. OTHER GAINS/(LOSSES) 2016 2015$'000 $'000

Net Gain on Revaluation of Property, Plant and Equipment ((i) and Note 8(b)) 6,959 23,471Net Loss due to Increase in Remediation Provision from Revised Estimate of Liability (Note 15(b)) (6,820) (14,530)Impairment Loss on Work in Progress - Project Costs Recoverable (167) (779)Impairment Loss on Intangible Assets Note 10(b) (21) -Impairment Loss on Work in Progress - Property, Plant and Equipment (Note 8(b)) (394) -Other Gains/(Losses) (443) 8,162

(i) A net gain on revaluation of Property, Plant and Equipment of $6.9 million ($23.5m in 2014-15) was recognised in theNet Result as it reversed revaluation decreases of the same class of assets previously recognised in the Net Result.

6. CASH AND CASH EQUIVALENTS 2016 2015$'000 $'000

(a) Reconciliation of Cash and Cash Equivalents

Cash at Bank and On HandOperating Funds 64,941 223,993Restricted Cash:

Land Remediation Funds (i) 39,460 40,337Agency Property Transaction Monies (ii) 4,490 1,345

Total Cash and Cash Equivalents 108,891 265,675

(i) A total of $39.5 million ($40.3m at 30 June 2015) is set aside and can only be used for remediation on Newcastle landsacquired by the Crown from BHP Billiton in 2002.

(ii) A total of $4.5 million ($1.3m at 30 June 2015) was held "on trust" on behalf of other government agencies and can onlybe used for property acquisition and divestment transactions in progress, negotiations for which were being undertakenby GPNSW under formal agreement with those agencies (Note 13).

For the purposes of the Statement of Cash Flows, cash includes cash on hand, cash at bank and "restricted cash".The significant decrease in Operating Funds over 2014-15 was mainly due to the receipt of $169.6 million in net propertysale proceeds in late June 2015 - primarily from the settlement of the Parramatta Justice Precinct office buildings. Thenet proceeds from these sales were paid to the Restart NSW Fund in November 2015.

Refer to Note 20 for details regarding credit risk, liquidity risk and market risk arising from financial instruments.

(b) Reconciliation of Net Cash Flows from Operating 2016 2015Activities to Net Result $'000 $'000

Net Cash Flow From Operating Activities (169,663) 9,084

Non Cash Revenue/(Expenses):Emerging Asset Increment/(Decrement) (Note 3(d)) 550 500Depreciation and Amortisation (Note 2(c)) (12,888) (16,741)Gain/(Loss) on Disposal of Non-Current Assets (Note 4) 1,468 28,264Other Gains/(Losses) (Note 5) (443) 8,162

Changes in Operating Assets and Liabilities:Increase/(Decrease) in Receivables 11,853 2,972Decrease/(Increase) in Payables (5,206) 11,006Decrease/(Increase) in Provisions (9,683) 181Decrease/(Increase) in Other Operating Liabilities (1,653) 507Net Result for the Year (185,665) 43,935


61

- 19 -



5. OTHER GAINS/(LOSSES) 2016 2015$'000 $'000

Net Gain on Revaluation of Property, Plant and Equipment ((i) and Note 8(b)) 6,959 23,471Net Loss due to Increase in Remediation Provision from Revised Estimate of Liability (Note 15(b)) (6,820) (14,530)Impairment Loss on Work in Progress - Project Costs Recoverable (167) (779)Impairment Loss on Intangible Assets Note 10(b) (21) -Impairment Loss on Work in Progress - Property, Plant and Equipment (Note 8(b)) (394) -Other Gains/(Losses) (443) 8,162

(i) A net gain on revaluation of Property, Plant and Equipment of $6.9 million ($23.5m in 2014-15) was recognised in theNet Result as it reversed revaluation decreases of the same class of assets previously recognised in the Net Result.

6. CASH AND CASH EQUIVALENTS 2016 2015$'000 $'000

(a) Reconciliation of Cash and Cash Equivalents

Cash at Bank and On HandOperating Funds 64,941 223,993Restricted Cash:

Land Remediation Funds (i) 39,460 40,337Agency Property Transaction Monies (ii) 4,490 1,345

Total Cash and Cash Equivalents 108,891 265,675

(i) A total of $39.5 million ($40.3m at 30 June 2015) is set aside and can only be used for remediation on Newcastle landsacquired by the Crown from BHP Billiton in 2002.

(ii) A total of $4.5 million ($1.3m at 30 June 2015) was held "on trust" on behalf of other government agencies and can onlybe used for property acquisition and divestment transactions in progress, negotiations for which were being undertakenby GPNSW under formal agreement with those agencies (Note 13).

For the purposes of the Statement of Cash Flows, cash includes cash on hand, cash at bank and "restricted cash".The significant decrease in Operating Funds over 2014-15 was mainly due to the receipt of $169.6 million in net propertysale proceeds in late June 2015 - primarily from the settlement of the Parramatta Justice Precinct office buildings. Thenet proceeds from these sales were paid to the Restart NSW Fund in November 2015.


(b) Reconciliation of Net Cash Flows from Operating 2016 2015Activities to Net Result $'000 $'000

Net Cash Flow From Operating Activities (169,663) 9,084

Non Cash Revenue/(Expenses):Emerging Asset Increment/(Decrement) (Note 3(d)) 550 500Depreciation and Amortisation (Note 2(c)) (12,888) (16,741)Gain/(Loss) on Disposal of Non-Current Assets (Note 4) 1,468 28,264Other Gains/(Losses) (Note 5) (443) 8,162

Changes in Operating Assets and Liabilities:Increase/(Decrease) in Receivables 11,853 2,972Decrease/(Increase) in Payables (5,206) 11,006Decrease/(Increase) in Provisions (9,683) 181Decrease/(Increase) in Other Operating Liabilities (1,653) 507Net Result for the Year (185,665) 43,935

- 20 -



7. RECEIVABLES 2016 2015$'000 $'000

CurrentTrade Receivables:

Property Rental 7,971 4,003Fees for Services Rendered 3,933 755Less: Impairment Allowance (a) (794) (780)Subtotal - Trade Receivables 11,110 3,978

Other Receivables:Work in Progress - Net Project Costs Recoverable 10,577 5,765Goods and Services Tax Recoverable 929 677Finance Lease Receivables (b) 4,035 4,035Lessee Lease Incentives (c) 8,025 8,476Makegood Costs Recoverable (d) 33,311 37,120Fitout Construction Receivable (Note 13) 112 112Accrued Rental Income 5,213 6,117Prepayments 1,921 1,716Other 881 2,080Subtotal - Other Receivables 65,004 66,098

Total Current Receivables 76,114 70,076

Non-CurrentOther Receivables:

Finance Lease Receivables (b) 62,331 61,575Lessee Lease Incentives (c) 42,865 51,099Makegood Costs Recoverable (d) 114,066 100,528Receivable from Lessees (Note 13) 7,687 5,338

Total Non-Current Receivables 226,949 218,540

Trade receivables and other receivables including makegood are non-interest bearing and are generally on 30-day terms.

(a) Impairment Allowance 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 780 540Amount Written Off (30) (3)Increase/(Decrease) in Allowance 44 243Carrying Amount at 30 June 794 780

The impairment allowance at 30 June 2016 includes an accumulated allowance of nil (nil at 30 June 2015) foruncollectible minimum finance lease payments receivable.

(b) Finance Lease Receivables 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 65,610 64,907Lease Payments Received (4,791) (4,515)Property Finance Lease Income (Note 3(b)) 5,547 5,218Carrying Amount at 30 June 66,366 65,610

(i) Reconciliation between Gross Investment in Finance Leases as Lessorand the Present Value of the Minimum Lease Payments Receivable

Gross Investment in Finance Leases as Lessor 305,624 309,659Less: Unearned Finance Income (239,258) (244,049)Present Value of the Minimum Lease Payments Receivable 66,366 65,610


62

- 21 -



7. RECEIVABLES (CONTINUED)

(b) Finance Lease Receivables (Continued) 2016 2015$'000 $'000

(ii) Aged Reconciliation of the Gross Investment in Finance Leases as Lessor

Not later than one year 4,035 4,035Later than one year and not later than five years 16,141 16,141Later than five years. 285,448 289,483Gross Investment in Finance Leases as Lessor 305,624 309,659

(iii) Aged Reconciliation of the Present Value of the Minimum Lease 2016 2015Payments Receivable $'000 $'000

Not later than one year 4,035 4,035Later than one year and not later than five years 13,313 13,313Later than five years. 49,018 48,262Present Value of the Minimum Lease Payments Receivable 66,366 65,610

(iv) The unguaranteed residual value of all finance leases as lessor accruing to the benefit of GPNSW as at 30 June 2016 is$17.7 million ($16.5m at 30 June 2015).

(v) GPNSW's material leasing arrangements which give rise to finance lease receivables involve owned propertieswhich are leased to tenants under lease terms of 50 years or more.

(c) Lessee Lease Incentives 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July (i) 59,575 28,357Add Lease Incentives Provided 542 40,239Less Current Year Amortisation (Note 3(a)(i)) (9,227) (9,021)Carrying Amount at 30 June 50,890 59,575

Current Asset 8,025 8,476Non-Current Asset 42,865 51,099Total Asset at 30 June 50,890 59,575

(i) Lessee lease incentives provided relate to incentives given to GPNSW under head lease agreements which GPNSWhas passed on to government agency tenants under sub-lease arrangements. Lessee lease incentives are amortisedover the term of each lease and are recognised as a reduction to Property Rental Income under Sale of Goods andServices in the Statement of Comprehensive Income (Note 3(a)(i)).

(d) Makegood Costs Recoverable 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 137,648 155,122Increase in Recoverable from Unwinding of Discount Rate (Note 15(c)) 2,825 4,058Increase/(Decrease) in Recoverable from Revised Estimate of Liability 12,426 (14,595)Decrease in Recoverable from Payments (Note 15(c)) (5,522) (6,007)Decrease in Recoverable from Payments Received in Advance - (930)Carrying Amount at 30 June 147,377 137,648


63

- 21 -




(b) Finance Lease Receivables (Continued) 2016 2015$'000 $'000

(ii) Aged Reconciliation of the Gross Investment in Finance Leases as Lessor

Not later than one year 4,035 4,035Later than one year and not later than five years 16,141 16,141Later than five years. 285,448 289,483Gross Investment in Finance Leases as Lessor 305,624 309,659

(iii) Aged Reconciliation of the Present Value of the Minimum Lease 2016 2015Payments Receivable $'000 $'000

Not later than one year 4,035 4,035Later than one year and not later than five years 13,313 13,313Later than five years. 49,018 48,262Present Value of the Minimum Lease Payments Receivable 66,366 65,610

(iv) The unguaranteed residual value of all finance leases as lessor accruing to the benefit of GPNSW as at 30 June 2016 is$17.7 million ($16.5m at 30 June 2015).

(v) GPNSW's material leasing arrangements which give rise to finance lease receivables involve owned propertieswhich are leased to tenants under lease terms of 50 years or more.

(c) Lessee Lease Incentives 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July (i) 59,575 28,357Add Lease Incentives Provided 542 40,239Less Current Year Amortisation (Note 3(a)(i)) (9,227) (9,021)Carrying Amount at 30 June 50,890 59,575

Current Asset 8,025 8,476Non-Current Asset 42,865 51,099Total Asset at 30 June 50,890 59,575

(i) Lessee lease incentives provided relate to incentives given to GPNSW under head lease agreements which GPNSWhas passed on to government agency tenants under sub-lease arrangements. Lessee lease incentives are amortisedover the term of each lease and are recognised as a reduction to Property Rental Income under Sale of Goods andServices in the Statement of Comprehensive Income (Note 3(a)(i)).

(d) Makegood Costs Recoverable 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 137,648 155,122Increase in Recoverable from Unwinding of Discount Rate (Note 15(c)) 2,825 4,058Increase/(Decrease) in Recoverable from Revised Estimate of Liability 12,426 (14,595)Decrease in Recoverable from Payments (Note 15(c)) (5,522) (6,007)Decrease in Recoverable from Payments Received in Advance - (930)Carrying Amount at 30 June 147,377 137,648

- 22 -




(d) Makegood Costs Recoverable (Continued) 2016 2015$'000 $'000

Current AssetMakegood Costs Recoverable (Note 15) 33,583 37,392Less Payments Received in Advance (272) (272)Total Current Asset at 30 June 33,311 37,120

Non-Current AssetMakegood Costs Recoverable (Note 15) 114,724 101,186Less Payments Received in Advance (658) (658)Total Non-Current Asset at 30 June 114,066 100,528Total Asset at 30 June 147,377 137,648

8. PROPERTY, PLANT AND EQUIPMENT 2016 2015$'000 $'000

(a) Carrying Amount at 30 June

Non-Current Land and BuildingsAt Fair Value 421,178 323,577Carrying Amount at 30 June 421,178 323,577

LandAt Fair Value 128,097 132,200Carrying Amount at 30 June 128,097 132,200

Plant and EquipmentAt Fair Value 8,328 7,405Less Accumulated Depreciation (3,531) (2,816)Carrying Amount at 30 June 4,797 4,589

Finance Lease AssetsAt Fair Value 170,094 130,760Carrying Amount at 30 June 170,094 130,760

Works in Progress 5,360 2,049

Total Non-Current Property, Plant and Equipment at 30 June 729,526 593,175

Total at Cost or Fair Value 733,057 595,991Total Accumulated Depreciation and Amortisation (3,531) (2,816)Total Non-Current Property, Plant and Equipment at 30 June 729,526 593,175


64

- 23 -



8. PROPERTY, PLANT AND EQUIPMENT (CONTINUED)

(b) Reconciliation of Opening and Closing Carrying Amounts 2016 2015$'000 $'000

Land and Buildings (i)Carrying Amount at 1 July 323,577 457,391Disposals (Note 4) - (20,727)Transfer from Works in Progress 2,108 3,198Transfers from other Government Agencies (Note 17(c)) 102,669 84,425Reclassification to Non-Current Asset Held for Sale (Note 9(b)) (38,308) (243,057)Transfer to Local Government (Note 2(d) and Note 8(b)(iv)) (495) -Net Revaluation Reserve Increment/(Decrement) (Note 17(b)(i)) 39,820 25,244Net Revaluation Increment/(Decrement) Recognised in the Net Result (Note 5) - 30,122Depreciation Expense (Note 2(c)) (8,193) (13,019)Carrying Amount at 30 June 421,178 323,577

2016 2015$'000 $'000

Land (i)Carrying Amount at 1 July 132,200 127,990Transfer from Works in Progress 176 133Transfers from other Government Agencies (Note 17(c)) 10,500 16,992Reclassification to Non-Current Asset Held for Sale (Note 9(b)) (23,331) (6,264)Reclassification from Non-Current Asset Held for Sale (Note 9(b)) 1,593 -Net Revaluation Increment/(Decrement) Recognised in the Net Result (Note 5) 6,959 (6,651)Carrying Amount at 30 June 128,097 132,200

2016 2015$'000 $'000

Plant and EquipmentCarrying Amount at 1 July 4,589 5,116Additions 926 170Disposals (Note 4) - (11)Depreciation Expense (Note 2(c)) (718) (686)Carrying Amount at 30 June 4,797 4,589

2016 2015$'000 $'000

Finance Lease Assets (ii)Carrying Amount at 1 July 130,760 110,990Transfer from Works in Progress 2 504Net Revaluation Reserve Increment (Note 17(b)(i)) 42,171 21,690Depreciation Expense (Note 2(c)) (2,839) (2,424)Carrying Amount at 30 June 170,094 130,760

2016 2015$'000 $'000

Works in Progress (iii)Carrying Amount at 1 July 2,049 454Additions 7,095 5,430Transfer to Land and Buildings (2,108) (3,198)Transfer to Land (176) (133)Transfer to Finance Lease Assets (2) (504)Impairment Loss (Note 5) (394) -Transfer to Intangible Assets (Note 10(b)) (1,104) -Carrying Amount at 30 June 5,360 2,049


65

- 23 -





Land and Buildings (i)Carrying Amount at 1 July 323,577 457,391Disposals (Note 4) - (20,727)Transfer from Works in Progress 2,108 3,198Transfers from other Government Agencies (Note 17(c)) 102,669 84,425Reclassification to Non-Current Asset Held for Sale (Note 9(b)) (38,308) (243,057)Transfer to Local Government (Note 2(d) and Note 8(b)(iv)) (495) -Net Revaluation Reserve Increment/(Decrement) (Note 17(b)(i)) 39,820 25,244Net Revaluation Increment/(Decrement) Recognised in the Net Result (Note 5) - 30,122Depreciation Expense (Note 2(c)) (8,193) (13,019)Carrying Amount at 30 June 421,178 323,577

2016 2015$'000 $'000

Land (i)Carrying Amount at 1 July 132,200 127,990Transfer from Works in Progress 176 133Transfers from other Government Agencies (Note 17(c)) 10,500 16,992Reclassification to Non-Current Asset Held for Sale (Note 9(b)) (23,331) (6,264)Reclassification from Non-Current Asset Held for Sale (Note 9(b)) 1,593 -Net Revaluation Increment/(Decrement) Recognised in the Net Result (Note 5) 6,959 (6,651)Carrying Amount at 30 June 128,097 132,200

2016 2015$'000 $'000

Plant and EquipmentCarrying Amount at 1 July 4,589 5,116Additions 926 170Disposals (Note 4) - (11)Depreciation Expense (Note 2(c)) (718) (686)Carrying Amount at 30 June 4,797 4,589

2016 2015$'000 $'000

Finance Lease Assets (ii)Carrying Amount at 1 July 130,760 110,990Transfer from Works in Progress 2 504Net Revaluation Reserve Increment (Note 17(b)(i)) 42,171 21,690Depreciation Expense (Note 2(c)) (2,839) (2,424)Carrying Amount at 30 June 170,094 130,760

2016 2015$'000 $'000

Works in Progress (iii)Carrying Amount at 1 July 2,049 454Additions 7,095 5,430Transfer to Land and Buildings (2,108) (3,198)Transfer to Land (176) (133)Transfer to Finance Lease Assets (2) (504)Impairment Loss (Note 5) (394) -Transfer to Intangible Assets (Note 10(b)) (1,104) -Carrying Amount at 30 June 5,360 2,049

- 24 -




(b) Reconciliation of Opening and Closing Carrying Amounts (Continued)

(i) Valuation of Land and Buildings and Land

All properties within the asset classes of Land and Buildings and Land (classified under Property Plant and Equipment)were independently valued as at 30 June 2016. Qualified valuers, AssetVal Pty Ltd, Savills Valuation, Knight Frank, andCBRE were engaged to provide GPNSW with independent property valuation reports. Each firm provided individualvaluations on a sub-set of properties assigned to them. The valuations took into consideration changes to market andeconomic conditions that have occurred since 30 June 2015 as well as the previous valuation reports.

(ii) Finance Lease Assets

Finance lease assets as at 30 June 2016 relate to Noel Park House, Marius Street, Tamworth and a part of the 52Martin Place building, Sydney. Noel Park House and 52 Martin Place building are being amortised over the life of thelease. Noel Park House and 52 Martin Place building were independently revalued on 30 June 2016 by qualified valuer,Knight Frank who has recent experience in comparable markets and the category of the finance lease asset beingvalued.

(iii) Works in Progress

Expenditure capitalised during the year and recorded under works in progress as at 30 June 2016 relates torefurbishment works in various office buildings and GPNSW corporate capital projects totalling $5.4 million ($2.0m at30 June 2015 of which $1.1m was transferred to Intangible Assets).

(iv) Transfer to Local Government

The following property was transferred to Local Government for nominal consideration during 2015-16:• Mittagong, Lot 5 Bessemer Street (to Wingecarribee Shire Council)

9. NON-CURRENT ASSETS HELD FOR SALE 2016 2015$'000 $'000

(a) Carrying Amount at 30 June

Land and Buildings 45,746 73,515Land 6,340 6,764Carrying Amount at 30 June 52,086 80,279


Non-Current Assets Held for SaleCarrying Amount at 1 July 80,279 793Reclassification from Property, Plant and Equipment - Land and Buildings (Note 8(b)) 38,308 243,057Reclassification from Property, Plant and Equipment - Land (Note 8(b)) 23,331 6,264Reclassification to Property, Plant and Equipment - Land (Note 8(b)) (1,593) -Disposals (Note 4) (88,239) (169,835)Carrying Amount at 30 June 52,086 80,279


66

- 25 -



10. INTANGIBLE ASSETS 2016 2015$'000 $'000

(a) Carrying Amount at 30 JuneComputer SoftwareGross Carrying Amount 6,008 3,844Less Accumulated Amortisation (4,115) (2,979)Carrying Amount at 30 June 1,893 865


Intangible AssetsCarrying Amount at 1 July 865 932Additions/Acquisitions 1,083 545Transfer from Works in Progress (Note 8(b)) 1,104 -Impairment Loss (Note 5) (21) -Amortisation Expense (Note 2(c)) (1,138) (612)Carrying Amount at 30 June 1,893 865

11. OTHER 2016 2015$'000 $'000

Emerging Asset (i)Carrying Amount at 1 July 5,850 5,300Net Revaluation Reserve Increment (Note 17(b)(i)) 50 50Emerging Asset Increment (Note 3(d)) 550 500Carrying Amount at 30 June 6,450 5,850

(i) An emerging asset in relation to the Sydney Opera House Car Park is recognised under Non-Current Assets - Other.The car park land, which is recognised as a Finance Lease Receivable, was leased to a private consortium on a 50year ground lease which commenced on 13 March 1993. The lessee has constructed, at its own expense, asubterranean car park which has an assessed economic life of greater than 50 years. At the expiration of the leaseterm GPNSW has the right to receive the car park.

The emerging value of the car park is $6.5 million at 30 June 2016 ($5.9m at 30 June 2015). The emerging value isbeing allocated to revenue and Non-Current Assets - Other during the term of the lease as if it were the compound valueof an annuity discounted at the NSW Government bond rate applicable at 13 March 1993, being 8.25%.

Qualified valuer, Knight Frank was engaged to provide an independent fair value valuation of the lessor's interest in thefreehold property subject to the existing lease as prescribed under Treasury Accounting Policy TPP 06-8 "Accountingfor Privately Financed Projects" as at 30 June 2016.


67

- 25 -



10. INTANGIBLE ASSETS 2016 2015$'000 $'000

(a) Carrying Amount at 30 JuneComputer SoftwareGross Carrying Amount 6,008 3,844Less Accumulated Amortisation (4,115) (2,979)Carrying Amount at 30 June 1,893 865


Intangible AssetsCarrying Amount at 1 July 865 932Additions/Acquisitions 1,083 545Transfer from Works in Progress (Note 8(b)) 1,104 -Impairment Loss (Note 5) (21) -Amortisation Expense (Note 2(c)) (1,138) (612)Carrying Amount at 30 June 1,893 865

11. OTHER 2016 2015$'000 $'000

Emerging Asset (i)Carrying Amount at 1 July 5,850 5,300Net Revaluation Reserve Increment (Note 17(b)(i)) 50 50Emerging Asset Increment (Note 3(d)) 550 500Carrying Amount at 30 June 6,450 5,850

(i) An emerging asset in relation to the Sydney Opera House Car Park is recognised under Non-Current Assets - Other.The car park land, which is recognised as a Finance Lease Receivable, was leased to a private consortium on a 50year ground lease which commenced on 13 March 1993. The lessee has constructed, at its own expense, asubterranean car park which has an assessed economic life of greater than 50 years. At the expiration of the leaseterm GPNSW has the right to receive the car park.

The emerging value of the car park is $6.5 million at 30 June 2016 ($5.9m at 30 June 2015). The emerging value isbeing allocated to revenue and Non-Current Assets - Other during the term of the lease as if it were the compound valueof an annuity discounted at the NSW Government bond rate applicable at 13 March 1993, being 8.25%.

Qualified valuer, Knight Frank was engaged to provide an independent fair value valuation of the lessor's interest in thefreehold property subject to the existing lease as prescribed under Treasury Accounting Policy TPP 06-8 "Accountingfor Privately Financed Projects" as at 30 June 2016.

- 26 -



12. FAIR VALUE MEASUREMENT OF NON-FINANCIAL ASSETS

(a) Fair Value Hierarchy

2016 Level 1 Level 2 Level 3 Total FairValue

$'000 $'000 $'000 $'000Property, Plant and Equipment (Note 8)

Land and Buildings - 421,178 - 421,178Land - 128,097 - 128,097Finance Lease Assets - 170,094 - 170,094

Other Asset (Note 11)Emerging Asset - 6,450 - 6,450

- 725,819 - 725,819

2015 Level 1 Level 2 Level 3 Total FairValue

$'000 $'000 $'000 $'000Property, Plant and Equipment (Note 8)

Land and Buildings - 323,577 - 323,577Land - 132,200 - 132,200Finance Lease Assets - 130,760 - 130,760

Other Asset (Note 11)Emerging Asset - 5,850 - 5,850

- 592,387 - 592,387

There were no transfers between Level 1 or 2 during 2015-16. The 'Total Fair Value' above includes assets measured atfair value and will not reconcile to the total Property, Plant and Equipment recognised in the Statement of FinancialPosition as this includes assets which are measured at depreciated historical cost, as an approximation of fair value.These non-specialised assets do not require fair value hierarchy disclosures under AASB 13 "Fair Value Measurement".

(b) Valuation Techniques, Input and Processes

GPNSW's Property, Plant and Equipment and Other Asset assets are traded in active markets. The fair values of theseassets are estimated using valuation techniques that maximise the use of observable market inputs, for example marketsale, market rent and interest rates. If all significant inputs required to fair value an asset are observable, the asset isincluded in Level 2. If one or more of the significant inputs is not based on observable market data, the asset is includedin Level 3. The valuation process is managed by GPNSW's Property Management Group (PMG) who engages externalindependent valuers to perform the valuations of property assets required for financial reporting purposes. The valuationreports are subsequently reviewed by relevant PMG Asset Managers prior to being endorsed by senior management.

The methods and valuation techniques used for the purpose of measuring fair value are unchanged compared to theprevious reporting period.

13. PAYABLES 2016 2015$'000 $'000

CurrentSundry Creditors and Accruals 18,418 16,096Fitout Construction Payable (Note 7) 112 112Agency Property Transaction Monies (Note 6(a)(ii)) 4,490 1,345Payable to Personnel Services Provider (Note 1(a)) 649 1,872Total Current Payables 23,669 19,425

Non-CurrentPayable to Lessor (Note 7) 7,687 5,338Total Non-Current Payables 7,687 5,338


68

- 27 -



14. BORROWINGS 2016 2015$'000 $'000

CurrentFinance Lease Liabilities (a) 866 1,074Total Current Borrowings 866 1,074

Non-CurrentFinance Lease Liabilities (a) 34,398 35,265Total Non-Current Borrowings 34,398 35,265

The Finance Lease Liabilities are secured by the assets leased.

(a) Finance Lease Liabilities 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 36,339 37,327Minimum Lease Payments (6,004) (6,003)Finance Lease Interest Charges (Note 2(e)) 4,929 5,015Carrying Amount at 30 June (Note 18(c)) 35,264 36,339

15. PROVISIONS 2016 2015$'000 $'000

CurrentLand Remediation (b) 69,966 32,549Makegood Restoration ((c) and Note 7(d)) 33,583 37,392Total Current Provisions 103,549 69,941

Non-CurrentPersonnel Services (a) - 18,182Land Remediation (b) 1,355 35,909Makegood Restoration ((c) and Note 7(d)) 114,724 101,186Makegood Restoration - GPNSW Self Occupied Premises (c) 301 233Total Non-Current Provisions 116,380 155,510

(a) Personnel Services 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 18,182 18,207Net Increase/(Decrease) in Liability to Personnel Services Provider - (25)Transfer of Defined Benefit Superannuation Liabilities to the Crown through DFSI ((i) and Note 17(c)) (18,182) -Carrying Amount at 30 June - 18,182

Non-Current Liability - 18,182Total Liability at 30 June - 18,182

Aggregate Personnel Services Liability - Dissection 2016 2015$'000 $'000

Unfunded Superannuation (Defined Benefits Schemes) (i) - 18,182Total Liability at 30 June - 18,182

GPNSW receives personnel services from the Department of Finance, Services and Innovation (DFSI). The DFSI is nota Special Purpose Service Entity and does not control GPNSW under this arrangement (Note 1(a)). As GPNSW is notan employer, the disclosure requirements of AASB 119 "Employee Benefits" in respect of employee benefits do notapply. However, for clarity and transparency, a Personnel Services Provision is disclosed where the substance of theunderlying liability recognised effectively represents employee benefits.

- 28 -



15. PROVISIONS (CONTINUED)

(a) Personnel Services (Continued)

(i) Unfunded Superannuation (Defined Benefits Schemes)

The superannuation schemes for the personnel provided to GPNSW by DFSI include the State SuperannuationScheme, the State Authorities Superannuation Scheme and the State Authorities Non-contributory SuperannuationScheme. These schemes are all defined benefit schemes - at least a component of the final benefit is derived from amultiple of member salary and years of membership. All the schemes are closed to new members.

On 1 July 2015, all DFSI defined benefit superannuation liabilities, including GPNSW's unfunded superannuation liabilityof $18.2 million, were transferred to the Crown through an equity transfer in accordance with the Treasurer's approval.Accordingly, GPNSW has derecognised the unfunded defined benefit superannuation provision of $18.2 million in July2015 through an equity transfer with DFSI.

(b) Land Remediation 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 68,458 52,672Decrease in Provision from Payments (2,216) (77)Decrease in Provision from Reclassification to Payables (3,146) -Increase in Provision from Unwinding of Discount Rate (Note 2(e)) 1,405 1,333Increase in Provision from Revised Estimate of Liability Recognised in Net Result (Note 5) 6,820 14,530Carrying Amount at 30 June 71,321 68,458

Current Liability 69,966 32,549Non-Current Liability 1,355 35,909Total Liability at 30 June 71,321 68,458

Land remediation provisions as at 30 June 2016 relate to Newcastle landholdings (i) and Hunter's Hill landholdings (ii).

(i) Newcastle Landholdings

In June 2002, the Crown acquired the former BHP main steel works site at Mayfield and the Kooragang Islands wasteemplacement sites in the Newcastle ports area. These sites required remediation to remove various contaminantsassociated with steel making. As part of the acquisition, the Crown negotiated for BHP Billiton to pay an amount tocompensate for the total estimated cost of the land remediation and other works. In February 2007, the landholdings,remaining remediation liability and cash balance were transferred to GPNSW.

In July 2009, management control for two parcels of the unremediated land at Mayfield and the Kooragang Island sitewere transferred to the Newcastle Port Corporation (NPC). At 30 June 2016, GPNSW retained ownership of theremaining parcel of the former steel works site at Mayfield (known as Mayfield Lot 1).

The Hunter Development Corporation (HDC) is the agency assigned by Government to undertake the remediation works.Under arrangement, GPNSW periodically reimburses the HDC for works undertaken and each year, the HDC providesGPNSW with a revised estimate of costs remaining to complete the works. Calculation of this estimate is based oncurrent technical studies and analysis taking into account current and future contract costs, referable to awardedcontracts where available. Where necessary, costs are indexed and discounted using general construction industrydata available.

(ii) Hunter's Hill Landholdings

In June 2009, GPNSW acquired land at lots 7, 9 and 11 Nelson Parade Hunter's Hill. Each of these lots are situated on aformer uranium smelter site and, as part of the land transfers, the NSW Government has given GPNSW the responsibilityto remediate the contaminated land. GPNSW has estimated and recognised a remediation liability at the reporting date forall three lots. This estimate has been determined using quotes, contract and tender details available as at 30 June 2016.Minor works were undertaken in 2015-16, however the remaining remediation will be undertaken mainly in 2016-17 andcompleted in 2018-19.


69

- 27 -



14. BORROWINGS 2016 2015$'000 $'000

CurrentFinance Lease Liabilities (a) 866 1,074Total Current Borrowings 866 1,074

Non-CurrentFinance Lease Liabilities (a) 34,398 35,265Total Non-Current Borrowings 34,398 35,265

The Finance Lease Liabilities are secured by the assets leased.

(a) Finance Lease Liabilities 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 36,339 37,327Minimum Lease Payments (6,004) (6,003)Finance Lease Interest Charges (Note 2(e)) 4,929 5,015Carrying Amount at 30 June (Note 18(c)) 35,264 36,339

15. PROVISIONS 2016 2015$'000 $'000

CurrentLand Remediation (b) 69,966 32,549Makegood Restoration ((c) and Note 7(d)) 33,583 37,392Total Current Provisions 103,549 69,941

Non-CurrentPersonnel Services (a) - 18,182Land Remediation (b) 1,355 35,909Makegood Restoration ((c) and Note 7(d)) 114,724 101,186Makegood Restoration - GPNSW Self Occupied Premises (c) 301 233Total Non-Current Provisions 116,380 155,510

(a) Personnel Services 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 18,182 18,207Net Increase/(Decrease) in Liability to Personnel Services Provider - (25)Transfer of Defined Benefit Superannuation Liabilities to the Crown through DFSI ((i) and Note 17(c)) (18,182) -Carrying Amount at 30 June - 18,182

Non-Current Liability - 18,182Total Liability at 30 June - 18,182

Aggregate Personnel Services Liability - Dissection 2016 2015$'000 $'000

Unfunded Superannuation (Defined Benefits Schemes) (i) - 18,182Total Liability at 30 June - 18,182

GPNSW receives personnel services from the Department of Finance, Services and Innovation (DFSI). The DFSI is nota Special Purpose Service Entity and does not control GPNSW under this arrangement (Note 1(a)). As GPNSW is notan employer, the disclosure requirements of AASB 119 "Employee Benefits" in respect of employee benefits do notapply. However, for clarity and transparency, a Personnel Services Provision is disclosed where the substance of theunderlying liability recognised effectively represents employee benefits.

- 28 -




(a) Personnel Services (Continued)

(i) Unfunded Superannuation (Defined Benefits Schemes)

The superannuation schemes for the personnel provided to GPNSW by DFSI include the State SuperannuationScheme, the State Authorities Superannuation Scheme and the State Authorities Non-contributory SuperannuationScheme. These schemes are all defined benefit schemes - at least a component of the final benefit is derived from amultiple of member salary and years of membership. All the schemes are closed to new members.

On 1 July 2015, all DFSI defined benefit superannuation liabilities, including GPNSW's unfunded superannuation liabilityof $18.2 million, were transferred to the Crown through an equity transfer in accordance with the Treasurer's approval.Accordingly, GPNSW has derecognised the unfunded defined benefit superannuation provision of $18.2 million in July2015 through an equity transfer with DFSI.

(b) Land Remediation 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 68,458 52,672Decrease in Provision from Payments (2,216) (77)Decrease in Provision from Reclassification to Payables (3,146) -Increase in Provision from Unwinding of Discount Rate (Note 2(e)) 1,405 1,333Increase in Provision from Revised Estimate of Liability Recognised in Net Result (Note 5) 6,820 14,530Carrying Amount at 30 June 71,321 68,458


Land remediation provisions as at 30 June 2016 relate to Newcastle landholdings (i) and Hunter's Hill landholdings (ii).

(i) Newcastle Landholdings

In June 2002, the Crown acquired the former BHP main steel works site at Mayfield and the Kooragang Islands wasteemplacement sites in the Newcastle ports area. These sites required remediation to remove various contaminantsassociated with steel making. As part of the acquisition, the Crown negotiated for BHP Billiton to pay an amount tocompensate for the total estimated cost of the land remediation and other works. In February 2007, the landholdings,remaining remediation liability and cash balance were transferred to GPNSW.

In July 2009, management control for two parcels of the unremediated land at Mayfield and the Kooragang Island sitewere transferred to the Newcastle Port Corporation (NPC). At 30 June 2016, GPNSW retained ownership of theremaining parcel of the former steel works site at Mayfield (known as Mayfield Lot 1).

The Hunter Development Corporation (HDC) is the agency assigned by Government to undertake the remediation works.Under arrangement, GPNSW periodically reimburses the HDC for works undertaken and each year, the HDC providesGPNSW with a revised estimate of costs remaining to complete the works. Calculation of this estimate is based oncurrent technical studies and analysis taking into account current and future contract costs, referable to awardedcontracts where available. Where necessary, costs are indexed and discounted using general construction industrydata available.

(ii) Hunter's Hill Landholdings

In June 2009, GPNSW acquired land at lots 7, 9 and 11 Nelson Parade Hunter's Hill. Each of these lots are situated on aformer uranium smelter site and, as part of the land transfers, the NSW Government has given GPNSW the responsibilityto remediate the contaminated land. GPNSW has estimated and recognised a remediation liability at the reporting date forall three lots. This estimate has been determined using quotes, contract and tender details available as at 30 June 2016.Minor works were undertaken in 2015-16, however the remaining remediation will be undertaken mainly in 2016-17 andcompleted in 2018-19.


70

- 29 -




(c) Makegood Restoration 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 138,811 155,343Increase in Provision from Unwinding of Discount Rate (Note 7(d)) 2,825 4,058Increase in Provision from Unwinding of Discount Rate - GPNSW Occupied Premises (Note 2(e)) 7 12Increase/(Decrease) in Provision from Revised Estimate of Liability 12,487 (14,595)Decrease in Provision from Payments (Note 7(d)) (5,522) (6,007)Carrying Amount at 30 June 148,608 138,811


The makegood restoration liability is calculated on all leased properties, where GPNSW is the lessee and reflects anestimate of the cost to makegood the premises to their original condition at the end of the lease term. The makegoodcosts are recoverable in full from the sub-lessees except for GPNSW self occupied premises which totalled $0.3 millionat 30 June 2016 ($0.2m at 30 June 2015). An average discount rate of 1.63% was used at 30 June 2016 (2.04% as at30 June 2015) and the level of the provision is reviewed at the end of each year. Any movement in the MakegoodRestoration Provision is also reflected in Makegood Costs Recoverable within Receivables (Note 7(d)) except forGPNSW self occupied premises.

16. OTHER LIABILITIES 2016 2015$'000 $'000

CurrentLessor Lease Incentives (a) 8,025 8,476Total Current Liability at 30 June 8,025 8,476

Non-CurrentLessor Lease Incentives (a) 42,865 51,099Deposit Monies from Assets Sale (b) 15,000 -Total Non-Current Liability at 30 June 57,865 51,099

(a) Lessor Lease Incentives 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July (i) 59,575 28,632Additional Lease Incentives 542 40,239Less Current Year Amortisation (Note 2(b)(i)) (9,227) (9,296)Carrying Amount at 30 June 50,890 59,575


(i) Lessor lease incentives received relate to incentives given to GPNSW under head lease agreements. Lessor leaseincentives are amortised over the term of each lease and are recognised as a reduction to Property Head LeaseExpense under Other Operating Expenses in the Statement of Comprehensive Income (Note 2(b)(i)).

(b) Deposit Monies from Assets Sale

In September 2015, GPNSW received $15 million deposit monies for the purchase of a long-term lease over propertieslocated at 23-33 and 35-39 Bridge Street, Sydney. As the commencement of the lease is not until 2018 and is subjectto the purchaser obtaining all design and planning approvals for conversion of the properties into a hotel, the deposit isrecognised in the Statement of Financial Position as Other Liabilities.


71

- 29 -




(c) Makegood Restoration 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July 138,811 155,343Increase in Provision from Unwinding of Discount Rate (Note 7(d)) 2,825 4,058Increase in Provision from Unwinding of Discount Rate - GPNSW Occupied Premises (Note 2(e)) 7 12Increase/(Decrease) in Provision from Revised Estimate of Liability 12,487 (14,595)Decrease in Provision from Payments (Note 7(d)) (5,522) (6,007)Carrying Amount at 30 June 148,608 138,811


The makegood restoration liability is calculated on all leased properties, where GPNSW is the lessee and reflects anestimate of the cost to makegood the premises to their original condition at the end of the lease term. The makegoodcosts are recoverable in full from the sub-lessees except for GPNSW self occupied premises which totalled $0.3 millionat 30 June 2016 ($0.2m at 30 June 2015). An average discount rate of 1.63% was used at 30 June 2016 (2.04% as at30 June 2015) and the level of the provision is reviewed at the end of each year. Any movement in the MakegoodRestoration Provision is also reflected in Makegood Costs Recoverable within Receivables (Note 7(d)) except forGPNSW self occupied premises.

16. OTHER LIABILITIES 2016 2015$'000 $'000

CurrentLessor Lease Incentives (a) 8,025 8,476Total Current Liability at 30 June 8,025 8,476

Non-CurrentLessor Lease Incentives (a) 42,865 51,099Deposit Monies from Assets Sale (b) 15,000 -Total Non-Current Liability at 30 June 57,865 51,099

(a) Lessor Lease Incentives 2016 2015$'000 $'000

Movement:Carrying Amount at 1 July (i) 59,575 28,632Additional Lease Incentives 542 40,239Less Current Year Amortisation (Note 2(b)(i)) (9,227) (9,296)Carrying Amount at 30 June 50,890 59,575


(i) Lessor lease incentives received relate to incentives given to GPNSW under head lease agreements. Lessor leaseincentives are amortised over the term of each lease and are recognised as a reduction to Property Head LeaseExpense under Other Operating Expenses in the Statement of Comprehensive Income (Note 2(b)(i)).

(b) Deposit Monies from Assets Sale

In September 2015, GPNSW received $15 million deposit monies for the purchase of a long-term lease over propertieslocated at 23-33 and 35-39 Bridge Street, Sydney. As the commencement of the lease is not until 2018 and is subjectto the purchaser obtaining all design and planning approvals for conversion of the properties into a hotel, the deposit isrecognised in the Statement of Financial Position as Other Liabilities.

- 30 -



17. NOTE TO STATEMENT OF CHANGES IN EQUITY 2016 2015$'000 $'000

(a) Financial Distributions

Normal Distributions from Surplus on Rental Operations (Paid to the State Government) (Note 1(l)) 4,089 12,936Capital Repatriations from the Net Proceeds of Asset Sales (Paid to the State Government) (Note 1(l)) 62,500 52,393

66,589 65,329

(b) Asset Revaluation Reserve Dissection 2016 2015$'000 $'000

Asset Class:Land and Buildings 65,164 25,294Finance Lease Assets 114,288 72,117Fine Arts & Heritage Assets 2,759 2,759Total Asset Revaluation Reserve at 30 June 182,211 100,170

Movement:Carrying Amount at 1 July 100,170 53,186Net Increase in Property, Plant and Equipment Revaluation Surplus (i) 82,041 46,984Carrying Amount at 30 June 182,211 100,170

(i) Net Increase in Property, Plant and Equipment Revaluation Surplus - Dissection 2016 2015$'000 $'000

Land and Buildings (Note 8(b)) 39,820 25,244Finance Lease Assets (Note 8(b)) 42,171 21,690Emerging Asset (Note 11) 50 50Net Increase in Property, Plant and Equipment Revaluation Surplus 82,041 46,984

(c) Net Increase/(Decrease) in Net Assets from Equity Transfers 2016 2015$'000 $'000

Transfer of Defined Benefit Superannuation Liabilities to the Crown through DFSI (Note 15(a)) 18,182 -Transfer of Properties from other Government Agencies: Land and Buildings (Note 8(b)) 102,669 84,425 Land (Note 8(b)) 10,500 16,992Total Net Increase/(Decrease) in Net Assets from Equity Transfers 131,351 101,417

18. COMMITMENTS FOR EXPENDITURE 2016 2015$'000 $'000

(a) Capital Expenditure Commitments

Capital expenditure contracted at balance date but notprovided for:Payable within one year 483 -Payable later than one year but not later than five years - -Payable later than five years - -Total Capital Expenditure Commitments (Incl GST) 483 -

Total capital expenditure commitments relate to contracted refurbishment works on various owned buildings. Capitalexpenditure commitments at 30 June 2016 include GST recoverable input tax credits of $0.1 million (nil at 30 June2015) that are expected to be recoverable from the Australian Taxation Office.


72

- 31 -



18. COMMITMENTS FOR EXPENDITURE (CONTINUED) 2016 2015$'000 $'000

(b) Operating Lease Commitments

Head lease future minimum lease payments contractedat balance date but not provided for:Payable within one year 369,852 347,131Payable later than one year but not later than five years 758,423 621,838Payable later than five years 403,555 381,279Total Operating Lease Commitments (Incl GST) 1,531,830 1,350,248

The majority of future minimum lease payments will be recouped by GPNSW under sub-leases. Future minimum leasepayments and receipts as at 30 June 2016 include GST recoverable input tax credits of $139.3 million ($122.7m at 30June 2015) and GST payable of $139.3 million ($122.7m at 30 June 2015).

(c) Finance Lease Commitments 2016 2015$'000 $'000

Minimum Lease Payments:Payable within one year 5,705 6,003Payable later than one year but not later than five years 19,234 20,130Payable later than five years 426,350 431,160Total Minimum Lease Payment Commitment 451,289 457,293

Finance Costs:Payable within one year (4,839) (4,929)Payable later than one year but not later than five years (19,234) (19,264)Payable later than five years (391,952) (396,761)Total Finance Costs Commitment (416,025) (420,954)

Present Value of Finance Lease Commitments:Payable within one year 866 1,074Payable later than one year but not later than five years - 866Payable later than five years 34,398 34,399Total Present Value of Finance Lease Commitments (Note 14(a)) 35,264 36,339

GPNSW's Finance Lease Commitments comprise leases on Noel Park House, Tamworth and on part of the 52 MartinPlace building, Sydney. The Noel Park House lease has a lease term of 25 years with no option to purchase the assetat the completion of the lease term in 2017. The discount rate implicit in the lease is 8.64% pa. The 52 Martin Placelease liability is being amortised over the lease term, which is 124.25 years and ends in 2110. The discount rateimplicit in the lease is 14.91% pa.

19. CONTINGENT ASSETS AND CONTINGENT LIABILITIES

As at the reporting date, GPNSW was not aware of any contingent assets or contingent liabilities.

20. FINANCIAL INSTRUMENTS

GPNSW’s principal financial instruments are outlined below. These financial instruments arise directly from GPNSW’soperations or are required to finance GPNSW’s operations. GPNSW does not enter into or trade financial instruments,including derivative financial instruments, for speculative purposes.

GPNSW’s main risks arising from financial instruments are outlined below, together with GPNSW’s objectives, policies andprocesses for measuring and managing risk. Further quantitative and qualitative disclosures are included throughout thesefinancial statements.

The Chief Executive Officer has overall responsibility for the establishment and oversight of risk management and reviewsand agrees policies for managing risks. Risk management policies are established to identify and analyse the risks facedby GPNSW, to set risk limits and controls and to monitor risks. Compliance with policies is reviewed by GPNSW on aregular basis.


73

- 31 -



18. COMMITMENTS FOR EXPENDITURE (CONTINUED) 2016 2015$'000 $'000

(b) Operating Lease Commitments

Head lease future minimum lease payments contractedat balance date but not provided for:Payable within one year 369,852 347,131Payable later than one year but not later than five years 758,423 621,838Payable later than five years 403,555 381,279Total Operating Lease Commitments (Incl GST) 1,531,830 1,350,248

The majority of future minimum lease payments will be recouped by GPNSW under sub-leases. Future minimum leasepayments and receipts as at 30 June 2016 include GST recoverable input tax credits of $139.3 million ($122.7m at 30June 2015) and GST payable of $139.3 million ($122.7m at 30 June 2015).

(c) Finance Lease Commitments 2016 2015$'000 $'000

Minimum Lease Payments:Payable within one year 5,705 6,003Payable later than one year but not later than five years 19,234 20,130Payable later than five years 426,350 431,160Total Minimum Lease Payment Commitment 451,289 457,293

Finance Costs:Payable within one year (4,839) (4,929)Payable later than one year but not later than five years (19,234) (19,264)Payable later than five years (391,952) (396,761)Total Finance Costs Commitment (416,025) (420,954)

Present Value of Finance Lease Commitments:Payable within one year 866 1,074Payable later than one year but not later than five years - 866Payable later than five years 34,398 34,399Total Present Value of Finance Lease Commitments (Note 14(a)) 35,264 36,339

GPNSW's Finance Lease Commitments comprise leases on Noel Park House, Tamworth and on part of the 52 MartinPlace building, Sydney. The Noel Park House lease has a lease term of 25 years with no option to purchase the assetat the completion of the lease term in 2017. The discount rate implicit in the lease is 8.64% pa. The 52 Martin Placelease liability is being amortised over the lease term, which is 124.25 years and ends in 2110. The discount rateimplicit in the lease is 14.91% pa.

19. CONTINGENT ASSETS AND CONTINGENT LIABILITIES

As at the reporting date, GPNSW was not aware of any contingent assets or contingent liabilities.

20. FINANCIAL INSTRUMENTS

GPNSW’s principal financial instruments are outlined below. These financial instruments arise directly from GPNSW’soperations or are required to finance GPNSW’s operations. GPNSW does not enter into or trade financial instruments,including derivative financial instruments, for speculative purposes.

GPNSW’s main risks arising from financial instruments are outlined below, together with GPNSW’s objectives, policies andprocesses for measuring and managing risk. Further quantitative and qualitative disclosures are included throughout thesefinancial statements.

The Chief Executive Officer has overall responsibility for the establishment and oversight of risk management and reviewsand agrees policies for managing risks. Risk management policies are established to identify and analyse the risks facedby GPNSW, to set risk limits and controls and to monitor risks. Compliance with policies is reviewed by GPNSW on aregular basis.

- 32 -



20. FINANCIAL INSTRUMENTS (CONTINUED) 2016 2015$'000 $'000

(a) Financial Instrument Categories

Financial Assets - Carrying AmountsClass Category NotesCash and Cash Equivalents n/a 1(h)(x), 6 108,891 265,675Receivables (i) Loans and Receivables

(at Amortised Cost) 1(h)(xi), 7 300,213 286,223

Financial Liabilities - Carrying AmountsClass Category NotesPayables (ii) Financial Liabilities

(at Amortised Cost) 1(i)(i), 13 29,229 22,323Borrowings Financial Liabilities

(at Amortised Cost) 1(i)(ii), 14 35,264 36,339

(i) Receivables exclude statutory receivables and prepayments as they are not within the scope of AASB 7.(ii) Payables exclude statutory payables and unearned revenue as they are not within scope of AASB 7.

(b) Credit Risk

Credit risk arises when there is the possibility of GPNSW’s debtors defaulting on their contractual obligations, resultingin a financial loss to GPNSW. The maximum exposure to credit risk is generally represented by the carrying amount ofthe financial assets (net of any allowance for impairment).

Credit risk arises from the financial assets of GPNSW, including cash and receivables. No collateral is held by GPNSW.GPNSW has not granted any material financial guarantees, individually or in aggregate.

All of GPNSW's cash deposits are held within NSW Treasury Banking System bank accounts. All deposits held within theNSW Treasury Banking System are guaranteed by the State.

(i) Cash

Cash comprises cash on hand and bank balances within the NSW Treasury Banking System. Interest is earned onGPNSW's Land Remediation Account daily bank balance at the monthly average NSW Treasury Corporation 11amunofficial cash rate, adjusted for a management fee to NSW Treasury. All other bank accounts are non-interest bearingwithin the NSW Treasury Banking System.

(ii) Receivables - Trade Debtors

All trade debtors are recognised as amounts receivable at balance date. Collectability of trade debtors is reviewed onan ongoing basis. Procedures as established in the Treasurer’s Directions are followed to recover outstanding amounts,including letters of demand. Debts which are known to be uncollectable are written off. An allowance for impairment israised when there is objective evidence that GPNSW will not be able to collect all amounts due. This evidence includespast experience, current and expected changes in economic conditions and debtor credit ratings. No interest is earnedon trade debtors. Sales are made on 30-day terms.

GPNSW is not materially exposed to concentrations of credit risk to a single trade debtor or group of debtors. Basedon past experience, debtors which are not past due totalling $7.0 million ($2.4m at 30 June 2015) are not consideredimpaired and these represent 59.0% (51.6% at 30 June 2015) of the total trade debtors. Most of GPNSW’s debtors areNSW Government Agencies and therefore have an AAA credit rating. There are no debtors which are currently not pastdue or impaired whose terms have been renegotiated.

The only financial assets that are past due or impaired are trade debtors relating to property rental and fees-for-servicesincome. These are included within Receivables in the Statement of Financial Position.


74

- 33 -



20. FINANCIAL INSTRUMENTS (CONTINUED)

(b) Credit Risk (Continued)

(ii) Receivables - Trade Debtors (Continued)

Credit Risk - 2016 Total<1 Mth >1 <2 Mths >2 <3 Mths >3 Mths 2016

Financial Assets $'000 $'000 $'000 $'000 $'000

Receivables:Past Due But Not Impaired 324 1,311 206 2,240 4,081Considered Impaired 11 - 33 750 794Total Credit Risk 335 1,311 239 2,990 4,875



Receivables:Past Due But Not Impaired 185 357 326 687 1,555Considered Impaired - 5 36 709 750Total Credit Risk 185 362 362 1,396 2,305

(i) Each row in the above table reports "gross receivables".

(ii) The ageing analysis excludes statutory receivables, as these are not within the scope of AASB 7 and excludes receivables that are not past due and not impaired. Therefore, the Total Credit Risk line will not reconcile to thereceivables total recognised in the Statement of Financial Position.

(c) Liquidity Risk

Liquidity risk is the risk that GPNSW will be unable to meet its payment obligations when they fall due. GPNSWcontinuously manages risk through monitoring future cash flows planning to ensure adequate holding of available cash.GPNSW’s exposure to liquidity risk is deemed insignificant based on prior period data and current assessment of risk.

Liabilities are recognised for amounts due to be paid in the future for goods or services received, whether or notinvoiced. Amounts owing to suppliers (which are unsecured) are settled in accordance with the policy set out in NSWTreasury Circular 11/12. For small business suppliers, where terms are not specified, payment is made not later than30 days from date of receipt of a correctly rendered invoice. For other suppliers, if trade terms are not specified,payment is made no later than the end of the month following the month in which an invoice or a statement is received.For small business suppliers, where payment is not made within the specified time period, simple interest must be paidautomatically unless an existing contract specifies otherwise. For payments to other suppliers, GPNSW mayautomatically pay the supplier simple interest. The rate of interest applied by GPNSW accords with the current rateapplicable under section 22 of the Taxation Administration Act 1996 .

GPNSW's financial liabilities, as listed at (a) above, are all non-interest bearing. Payables are all payable within 12months (Note 13). Payable items which are out of the scope of AASB 7 "Financial Instruments: Disclosures" have beenexcluded from the carrying amount shown in the Statement of Financial Position. These items are GST payable andunearned revenue.

A maturity profile analysis of GPNSW's Finance Lease liabilities is presented at Note 18(c).

Overdue

Overdue

- 34 -




(d) Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changesin market prices. GPNSW’s exposure to market risk is primarily through interest rate risk on GPNSW’s BHPRemediation interest earning bank balance held within the NSW Treasury Banking System. GPNSW has no exposureto foreign currency risk and does not enter into commodity contracts.

The effect on profit and equity due to a reasonably possible change in risk variable is outlined below under interest raterisk. A reasonably possible change in risk variable has been determined after taking into account the economicenvironment in which GPNSW operates and the time frame for the assessment (i.e. until the end of the next annualreporting period). The sensitivity analysis is based on risk exposures in existence at the reporting date. The analysis isperformed on the same basis for 2016. The analysis assumes that all other variables remain constant.

(i) Interest Rate Risk

A reasonably possible change of ± 1% has been used, consistent with current trends in interest rates. The basis will bereviewed annually and amended where there is a structural change in the level of interest rate volatility. GPNSW’sexposure to interest rate risk is set out below.

Interest Rate Risk - 2016 CarryingAmount Profit Equity Profit Equity


Cash and Cash Equivalents 39,460 (395) (395) 395 395




The above interest rate sensitivity analysis has been performed on the assumption that all other variables remainunchanged. No sensitivity analysis has been performed on foreign exchange risk as GPNSW is not exposed to suchforeign exchange fluctuations.

(e) Fair Value

Financial instruments as shown in Note 20(a) are recognised in the Statement of Financial Position at amortised cost,which approximates the fair value.

21. BUDGET REVIEW

(a) Net Result

The Net Result was $202.8 million lower than budget, primarily due to:

• a $200.7 million increase in Grants and Subsidies expense due mainly to payments to the Restart NSW Fund fromthe net proceeds of property sales (Note 2(d)).

-1% +1%

-1% +1%


75

- 33 -




(b) Credit Risk (Continued)

(ii) Receivables - Trade Debtors (Continued)



Receivables:Past Due But Not Impaired 324 1,311 206 2,240 4,081Considered Impaired 11 - 33 750 794Total Credit Risk 335 1,311 239 2,990 4,875



Receivables:Past Due But Not Impaired 185 357 326 687 1,555Considered Impaired - 5 36 709 750Total Credit Risk 185 362 362 1,396 2,305

(i) Each row in the above table reports "gross receivables".

(ii) The ageing analysis excludes statutory receivables, as these are not within the scope of AASB 7 and excludes receivables that are not past due and not impaired. Therefore, the Total Credit Risk line will not reconcile to thereceivables total recognised in the Statement of Financial Position.

(c) Liquidity Risk

Liquidity risk is the risk that GPNSW will be unable to meet its payment obligations when they fall due. GPNSWcontinuously manages risk through monitoring future cash flows planning to ensure adequate holding of available cash.GPNSW’s exposure to liquidity risk is deemed insignificant based on prior period data and current assessment of risk.

Liabilities are recognised for amounts due to be paid in the future for goods or services received, whether or notinvoiced. Amounts owing to suppliers (which are unsecured) are settled in accordance with the policy set out in NSWTreasury Circular 11/12. For small business suppliers, where terms are not specified, payment is made not later than30 days from date of receipt of a correctly rendered invoice. For other suppliers, if trade terms are not specified,payment is made no later than the end of the month following the month in which an invoice or a statement is received.For small business suppliers, where payment is not made within the specified time period, simple interest must be paidautomatically unless an existing contract specifies otherwise. For payments to other suppliers, GPNSW mayautomatically pay the supplier simple interest. The rate of interest applied by GPNSW accords with the current rateapplicable under section 22 of the Taxation Administration Act 1996 .

GPNSW's financial liabilities, as listed at (a) above, are all non-interest bearing. Payables are all payable within 12months (Note 13). Payable items which are out of the scope of AASB 7 "Financial Instruments: Disclosures" have beenexcluded from the carrying amount shown in the Statement of Financial Position. These items are GST payable andunearned revenue.

A maturity profile analysis of GPNSW's Finance Lease liabilities is presented at Note 18(c).

Overdue

Overdue

- 34 -




(d) Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changesin market prices. GPNSW’s exposure to market risk is primarily through interest rate risk on GPNSW’s BHPRemediation interest earning bank balance held within the NSW Treasury Banking System. GPNSW has no exposureto foreign currency risk and does not enter into commodity contracts.

The effect on profit and equity due to a reasonably possible change in risk variable is outlined below under interest raterisk. A reasonably possible change in risk variable has been determined after taking into account the economicenvironment in which GPNSW operates and the time frame for the assessment (i.e. until the end of the next annualreporting period). The sensitivity analysis is based on risk exposures in existence at the reporting date. The analysis isperformed on the same basis for 2016. The analysis assumes that all other variables remain constant.

(i) Interest Rate Risk

A reasonably possible change of ± 1% has been used, consistent with current trends in interest rates. The basis will bereviewed annually and amended where there is a structural change in the level of interest rate volatility. GPNSW’sexposure to interest rate risk is set out below.







The above interest rate sensitivity analysis has been performed on the assumption that all other variables remainunchanged. No sensitivity analysis has been performed on foreign exchange risk as GPNSW is not exposed to suchforeign exchange fluctuations.

(e) Fair Value

Financial instruments as shown in Note 20(a) are recognised in the Statement of Financial Position at amortised cost,which approximates the fair value.

21. BUDGET REVIEW

(a) Net Result

The Net Result was $202.8 million lower than budget, primarily due to:

• a $200.7 million increase in Grants and Subsidies expense due mainly to payments to the Restart NSW Fund fromthe net proceeds of property sales (Note 2(d)).

-1% +1%

-1% +1%


76

- 35 -



21. BUDGET REVIEW (CONTINUED)

(b) Assets and Liabilities

Total Assets of $1.2 billion were $210.9 million greater than budget, primarily due to:

• a $48.3 million increase in Cash and Cash Equivalents due mainly to the deferral into 2016-17 of budgeted landremediation works (Note 21(c));

• a $52.1 million increase in Non-Current Assets Held for Sale due to confirmed sale commitments and contractexchanges for various properties as at 30 June 2016; and

• a $109.7 million increase in Property, Plant and Equipment due mainly to the vesting of various properties in 2015-16.

Total Liabilities of $352.4 million were $63.4 million greater than budget, primarily due to:

• $49.6m increase in the budgeted land remediation provision due to the deferral into 2016-17 of budgeted remediationworks at Mayfield and Hunter’s Hill in addition to revised cost estimates (Note 15(b)); and

• a $15.0m increase in Other Liabilities relating to deposit monies received on the sale of properties located at 23-33 and35-39 Bridge Street, Sydney which will not settle until July 2018 (Note 16(b)).

(c) Cash Flows

Closing Cash and Cash Equivalents was $48.3 million greater than budget, primarily due to:

• a $31.5 million increase due to budgeted land remediation works at Mayfield and Hunters Hill being deferred to 2016-17;• a $11.5 million increase due to Unspent Capital Contribution revenue from the State Government as at 30 June 2016;• a $4.5 million increase due to the receipt of Agency Property Transaction Monies; and• a $5.9 million increase from net property sale proceeds received in late 2015-16.

22. EVENTS AFTER THE REPORTING PERIOD

(a) Adjusting Events

There are no known events after the reporting period which would give rise to a material impact on the reported results orfinancial position of GPNSW as at 30 June 2016.

(b) Non-Adjusting Events

(i) Transfer of Functions from Other Agencies - On 1 July 2016, certain functions of the Sydney Harbour ForeshoreAuthority in relation to Corporate and Place Management services were transferred to GPNSW. In addition, the FacilitiesManagement function of NSW Public Works was also transferred to GPNSW from that date. The transfer of thesefunctions is expected to increase the revenues and expenses of GPNSW in 2016-17 however, the quantification of thefinancial impact was still in progress at the reporting date.

(ii) Owned and Leased Office Accommodation Property Vesting and Property Divestments – Pursuant to therecommendations of the Government's Property Asset Utilisation Taskforce and subsequent Premier’s MemorandumM2012-20, further divestment of various GPNSW owned properties, in addition to the ongoing vesting of Governmentagency owned and leased properties is likely to occur in separate tranches during 2016-17. As the identification andvalidation of these properties was still in progress at the reporting date, estimates of the financial impact on GPNSW'saccounts in 2016-17 are not available.

There are no known other non-adjusting events after the reporting period.

End of Audited Financial Statements


77

- 35 -



21. BUDGET REVIEW (CONTINUED)

(b) Assets and Liabilities

Total Assets of $1.2 billion were $210.9 million greater than budget, primarily due to:

• a $48.3 million increase in Cash and Cash Equivalents due mainly to the deferral into 2016-17 of budgeted landremediation works (Note 21(c));

• a $52.1 million increase in Non-Current Assets Held for Sale due to confirmed sale commitments and contractexchanges for various properties as at 30 June 2016; and

• a $109.7 million increase in Property, Plant and Equipment due mainly to the vesting of various properties in 2015-16.

Total Liabilities of $352.4 million were $63.4 million greater than budget, primarily due to:

• $49.6m increase in the budgeted land remediation provision due to the deferral into 2016-17 of budgeted remediationworks at Mayfield and Hunter’s Hill in addition to revised cost estimates (Note 15(b)); and

• a $15.0m increase in Other Liabilities relating to deposit monies received on the sale of properties located at 23-33 and35-39 Bridge Street, Sydney which will not settle until July 2018 (Note 16(b)).

(c) Cash Flows

Closing Cash and Cash Equivalents was $48.3 million greater than budget, primarily due to:

• a $31.5 million increase due to budgeted land remediation works at Mayfield and Hunters Hill being deferred to 2016-17;• a $11.5 million increase due to Unspent Capital Contribution revenue from the State Government as at 30 June 2016;• a $4.5 million increase due to the receipt of Agency Property Transaction Monies; and• a $5.9 million increase from net property sale proceeds received in late 2015-16.

22. EVENTS AFTER THE REPORTING PERIOD

(a) Adjusting Events

There are no known events after the reporting period which would give rise to a material impact on the reported results orfinancial position of GPNSW as at 30 June 2016.

(b) Non-Adjusting Events

(i) Transfer of Functions from Other Agencies - On 1 July 2016, certain functions of the Sydney Harbour ForeshoreAuthority in relation to Corporate and Place Management services were transferred to GPNSW. In addition, the FacilitiesManagement function of NSW Public Works was also transferred to GPNSW from that date. The transfer of thesefunctions is expected to increase the revenues and expenses of GPNSW in 2016-17 however, the quantification of thefinancial impact was still in progress at the reporting date.

(ii) Owned and Leased Office Accommodation Property Vesting and Property Divestments – Pursuant to therecommendations of the Government's Property Asset Utilisation Taskforce and subsequent Premier’s MemorandumM2012-20, further divestment of various GPNSW owned properties, in addition to the ongoing vesting of Governmentagency owned and leased properties is likely to occur in separate tranches during 2016-17. As the identification andvalidation of these properties was still in progress at the reporting date, estimates of the financial impact on GPNSW'saccounts in 2016-17 are not available.

There are no known other non-adjusting events after the reporting period.


• Statutory information



78

The NSW Government introduced Government Property NSW (GPNSW) as the new name of the State Property Authority (SPA), effective 12 December 2012, as a result of adopting new property principles and changes to the activities of SPA. Refer to Premier’s Memorandum M2012-20 for more information.

GPNSW has been assigned the NSW Government mandate to continually improve the management of the NSW Government’s owned and leased real property portfolio.

GPNSW operates under the following principal legislation:• Government Property NSW Act 2006.

Aims and objectivesUnder its Act, the principal objectives of GPNSW in exercising its functions are:• to improve operational efficiencies in the use government agency properties, particularly generic

properties such as offices, warehouses, depots and car parks• to manage properties of government agencies in a way that supports the service delivery functions of

those agencies• to provide advice and support within government on property matters, and• to operate at least as efficiently as any comparable business, consistently with the principles of

ecologically sustainable development and social responsibility for the community.

GPNSW delivers on its Act by:• holding, managing, maintaining, acquiring or disposing of property for the government and government

agencies• undertaking, managing, coordinating or participating in the development of government agency property• arranging, where appropriate, for the sharing of facilities and premises by government agencies to reduce

operational expenses• providing property services for its own or government agency properties, including property management,

maintenance and improvements• providing advice to the Minister in relation to government agency property, in particular:

o whether the properties are being efficiently utilisedo regarding the transfer of properties to GPNSW and related budgetso other matters relating to government agency properties, as the Minister directs.

Management and structureIn 2015/16, GPNSW, Teachers Housing Authority of NSW and Waste Assets Management Corporation consolidated with Sydney Harbour Foreshore Authority to form Property NSW.

Additionally, from 1 July 2016, Public Works Facilities Management and Valuation Services consolidated into Property NSW, and Public Works Advisory joined Property NSW to form the Property and Advisory Group.

As at 30 June 2016, Property NSW’s Executive team consisted of:• Brett Newman, Property NSW Deputy Secretary and GPNSW CEO• Adam Howarth, Executive Director, Portfolio Management Group• Dennis Szabo, Executive Director, Commercial Transactions• Leon Walker, Executive Director, Major Projects• Olga Masella, Acting Executive Director, Leasing

Our charter


79

• David Leahy, Executive Director, Operations• Stuart Crawford, Executive Director, Property Financial Services• Jenny Blatchford, Acting Executive Director, Strategy• Anna Welanyk, Executive Director, Valuation Services

Refer to Property NSW’s Annual Review 2015/16 for an organisational chart, as well as names and biographies of the Executive team as at submission date.

Legal changeGPNSW provides a range of Statutory Acquisitions Services, which include vesting under the GPNSW Act and acquisitions under the Land Acquisition (Just Terms Compensation) Act 1991 for GPNSW or client purposes.

Eight Orders under the GPNSW Act were notified in 2015/16 to transfer a total of 111 land parcels and 1 lease/license from government agencies to GPNSW, in accordance with Premier’s Memoranda 2012-20. The property transfers were effected from the following agencies for the purposes of ongoing management or to facilitate disposal:• Department of Justice • Department of Planning and Environment• NSW Department of Transport• Department of Education • Department of Premier and Cabinet • Department of Industry, Skills and Regional development • Department of Finance, Services and Innovation.

Human resourcesAs at 30 June 2016, GPNSW had a total of 100 ongoing employees and 3 temporary employees, with the remaining 21 employees either seconded, providing services as consultants or employed on Executive contracts.

There were no exceptional movements in wages, salaries or allowances, except for increases awarded across the public sector by the Industrial Relations Commission.

There were no industrial disputes lodged by the NSW Public Service Association with the Industrial Relations Commission of NSW. There was no working time lost due to industrial disputes during the year.

Requirements arising from employment arrangementsThere were no additional requirements for GPNSW.


80

Workforce profileA summary of GPNSW workforce profile* and other information is set out below:

*Excludes permanent employees of other agencies seconded to GPNSW.

Numbers and remuneration of senior executives

The average total remuneration package of senior executives at the end of the 2015/16 reporting period was $237,568.

The percentage of total employee-related expenditure in the reporting year that relates to senior executives is 44.1%.

Workforce diversity In 2015/16, GPNSW continued to promote Workforce Diversity and equal employment opportunity (EEO) through ongoing merit selection training, which was undertaken to ensure equity principles continue to be incorporated in recruitment and selection.

Equity principles also continue to be promoted through GPNSW’s Code of Conduct, including through induction sessions for new employees and ethics training for existing employees.

Trends in the representation of EEO groups among GPNSW employees are shown in the tables following.

During the year, GPNSW moved steadily closer to its primary diversity goal, nearing its benchmark 50 per cent for females at 46.8 per cent.

Category 2012/13 2013/14 2014/15 2015/16

Senior Executive Service 4.0 7.0 23.0 21.0

Corporate Management 8.0 4.0 13.8 23.0

Property Management 100.6 104.1 64.6 80.0

TOTAL 112.6 115.2 101.5 124.0

2012/13 2013/14 2014/15 2015/16

SES profile Male Female Male Female Male Female Male Female

SES 7 1 - 1 - 1 - 1 -

SES 5 1 - - - - - - -

SES 3 3 - 6 2 5 1 5 1

SEB 1 - - - - 8 8 7 7

TOTAL 5 - 7 2 14 9 13 8


81

Trends in the representation of EEO groups

Trends in the distribution of EEO groups

Contractors and consultants The Crown Employees (Public Service Condition of Employment – 2009) Award was varied in 2015 to provide for salary increases of 2.5%, effective from the first full pay period commencing on or after 1 July 2015.

The Statutory and Other Office Remuneration Tribunal (SOORT) awarded a 2.5% increase to the remuneration packages of Chief Executive (CES) and Senior Executive Service (SES) effective 1 July 2015.

Industrial relations policies and practices • Consultative forums Local Joint Consultative Committees (JCC) are embedded across the organisation. The local JCCs feed

into a peak JCC, which is chaired by the Secretary of DFSI. With so much significant change underway across the department, these consultative forums have greatly assisted managing any industrial unrest as a result of the change.

• Flexible Working Hours Agreement DFSI, which provides industrial relations support for GPNSW, successfully negotiated a new Flexible

Work Hours Agreement (FWHA) in 2015/16, replacing 11 different FWHAs that had existed across the department. The new agreement was signed on 30 June 2016 and is currently being implemented across DFSI, including GPNSW.

• Salaries, wages and allowances The agency applied the NSW Wages Policy for wage negotiations, which resulted in wage increases of 2.5

per cent.

% of total staff (excl. casuals)

EEO group Benchmark 2013/14 2014/15 2015/16

Women 50 39.3 33.8 46.8

Aboriginal people and Torres Strait Islanders

2.6 0.8 0 0

People whose first language spoken as a child was not English

19.0 15.6 13.6 13.7

People with a disability N/A 2.5 1.9 2.4

People with a disability requiring work-related adjustment

1.5 0.8 1.0 1.6


Women 100 89 94 95


100 N/A N/A N/A


100 N/A N/A N/A


82

Personnel policies and practicesDuring the reporting period, GPNSW was governed by the policies and procedures of the Department of Finance, Services and Innovation (DFSI).

In 2015/16, the Human Resources functions of Recruitment, Induction, Training and Development, and Payroll were managed by DFSI, to reflect the centralised corporate services model under the agency cluster.

Multicultural Policies and Services Program GPNSW is covered by the DFSI Multicultural Policies and Services Program Plan 2010–14, which ensures that the department delivers services to clients and staff from culturally and linguistically diverse (CALD) backgrounds and is compliant with the NSW Government’s Multicultural Planning Framework.

GPNSW also ensures that international symbols and signs are applied whenever government buildings are occupied or upgraded.

Disability inclusion action plans GPNSW is a part of the DFSI Disability Action Plan.

Work Health and Safety (WHS) GPNSW is committed to providing a healthy and safe workplace for all workers including contractors, agency staff and visitors.

During the period, there was one notification of injury resulting in a claim reported under the GPNSW workers compensation policy. There were no serious/notifiable incidents affecting staff.

A number of activities were undertaken in 2015/16 with the aim of a safer workplace, preventing injuries and illnesses and promoting timely, sustainable and early return to work for injured workers. These include:

• conducting workstation assessments for employees• promoting DFSI initiatives, such as Fitness Passport and the corporate influenza vaccination program, for

GPNSW staff and contractors• promoting the Employee Assistance Program to staff, particularly through the transition period• reviewing and promoting the WHS Hazard incident and injury reporting procedure as part of WHS

induction.

WHS Management activities included:• participation in the DFSI WHS Injury Management (WHISM) community of practice• contributing to a whole-of-department refresh of the WHS Safety Management System framework and

associated policies and procedures• development and delivery of WHS induction at Bligh House for staff and contractors• continued provision and training of Floor Wardens and accredited First Aid Officers • WHS inspection of Bligh House• identification and training of GPNSW Committee Representatives for the new Property NSW WHS

Committee.


83

PromotionIn May 2016, SHFA’s CEO, Sam Romaniuk, undertook Minister-approved travel to attend a United States–Australia City Exchange on innovation precincts. The exchange examined the various elements that contribute to the success of an innovation precinct, from the physical infrastructure to the social, economic and cultural shifts that need to occur to generate a thriving innovation ecosystem that generates jobs and economic benefits.

The learning supported development of the objectives and funding model for the newly-formed Place Management division under Property NSW.

The exchange, at a total cost of $27,471.32 (including airfares, meals and incidentals, and the exchange tour), was paid from the Government Property NSW Travel and Training budgets.

Consumer response GPNSW does not deliver front line services to the community. However, mechanisms are in place for its government agency clients to provide feedback relating to base building issues via the GPNSW Service Centre facility at www.gpnsw.net.au/Core/Content/Public-Home-Page/Content1557.aspx.

In 2015/16, the Service Centre continued as the central service point for agency property management issues.

Additionally, Property NSW responds daily to enquiries, complaints and compliments relating to all entities via [email protected]. Refer to www.property.nsw.gov.au/contact-us for more ways to contact Property NSW.

Property NSW has ensured that issues through both channels are dealt with appropriately and with a high degree of client satisfaction.

Property NSW also gauges client response to its service delivery through its annual client survey, aimed at achieving superior customer service and enhancing its service delivery.

Waste reduction initiativesGPNSW continued to implement a number of waste reduction and recycling initiatives during the year, including utilising co-mingled recycling bins in all office kitchens

More information on Property NSW’s waste reduction initiatives under the NSW Government Resource Efficiency Policy (GREP) can be found in Property NSW’s Annual Review 2015/16.


84

ConsultantsGPNSW engages consultants to augment existing expertise and resources. During 2015/16, GPNSW obtained the following consultancy services:

Credit card certificationIn 2015/16, credit card usage within GPNSW was mainly limited to claimable work-related travel expenses and expenditure for minor purchases where the use of credit cards is a more efficient means of payment.

In accordance with Treasurer’s Direction 205.01, credit card usage by officers of GPNSW during the reporting period was in accordance with relevant Government policy, Premier’s Memoranda and Treasurer’s Directions.

GPNSW has in place a corporate credit card policy that meets NSW Treasury guidelines.

ConsultanciesProjects / categories

Consultants Total cost $

Greater than $50,000Project title Consultant nameManagement Consultancy Services Tracey Shatek & Associates Pty Ltd 121,131

Less than $50,000Category Number of consultantsProperty 18 122,201Corporate 3 20,005

Total 263,337


85

Payment of accountsThe table below highlights GPNSW’s account payment performance for 2015/16.

Payment of Accounts

The table below highlights GPNSW’s account payment performance for 2015-16.

For all suppliers, the percentage of invoices paid on time for 2015-16 averaged 97% by value and 95% by number (98% and 96% respectively in 2014-15).

ACCOUNT PAYMENT 1ST 2ND 3RD 4TH TOTAL

PERFORMANCE 2015-16 QTR QTR QTR QTR

ALL SUPPLIERS

Value of Invoices Paid ($'000)

Paid Before Due Date 139,210 135,253 141,993 159,100 575,556

<30 Days Past Due Date 2,544 2,944 2,952 4,065 12,505

>30<60 Days Past Due Date 638 435 1,011 951 3,035

>60<90 Days Past Due Date 276 88 548 335 1,247

>90 Days Past Due Date 164 644 195 202 1,205

Total Value of Invoices Paid ($'000) 142,832 139,364 146,699 164,653 593,548

% Paid on Time - By Value 97% 97% 97% 97% 97%

Number of Invoices Paid

Paid Before Due Date 9,294 9,043 8,709 9,967 37,013

Paid Past Due Date 419 345 527 592 1,883

Total Number of Invoices Paid 9,713 9,388 9,236 10,559 38,896

% Paid on Time - By Number 96% 96% 94% 94% 95%

Interest Paid (i)

Number of Payments for Interest on

Overdue Invoices 25 20 40 37 122

Interest Paid on Overdue Invoices 2 - 2 2 6

SMALL BUSINESS SUPPLIERS

Value of Invoices Paid ($'000)

Paid Before Due Date 249 214 270 306 1,039

<30 Days Past Due Date - 10 28 19 57

>30<60 Days Past Due Date - - - 8 8

>60<90 Days Past Due Date - - - - -

>90 Days Past Due Date - - - - -

Total Value of Invoices Paid ($'000) 249 224 298 333 1,104

% Paid on Time - By Value 100% 96% 91% 92% 94%

Number of Invoices Paid

Paid Before Due Date 122 92 120 124 458

Paid Past Due Date - 2 8 8 18

Total Number of Invoices Paid 122 94 128 132 476

% Paid on Time - By Number 100% 98% 94% 94% 96%

Interest Paid (i)

Number of Payments for Interest on

Overdue Invoices - - 1 2 3

Interest Paid on Overdue Invoices - - - - -

In accordance with the Government 's revised payment of Accounts Policy (NSW TC 11/12 Payments of Accounts), interest totalling $163.68 was paid in respect of 3 small business supplier invoices and $6,079.35 was paid in respect of 119 General supplier invoices which were paid past their due date.


86

For all suppliers, the percentage of invoices paid on time for 2015-16 averaged 97% by value and 95% by number (98% and 96% respectively in 2014/15).

During 2015/16, GPNSW continued to monitor previously implemented system and procedural improvements, both internally and with its services providers (Cushman & Wakefield and FiveD Holdings), in an effort to ensure that all invoice payments were made within the prescribed payment requirements. The majority of payment delays experienced by GPNSW are process related and are mainly due to the logistical difficulties in securing certifications on services provided to properties which are spread across NSW. For 2016-17, GPNSW will again target payment performance in excess of 95%.

Out of the total number of invoices paid during 2015/16, 1.2% (or 0.19% by value) was paid to small business suppliers. Of this, 94% by number and 96% by value was paid on time. The invoice certification delays described above resulted in GPNSW being required to pay $163.68 in penalty interest in respect of three small business suppliers during 2015/16.

Risk management and insurance activitiesRisk Management FrameworkGPNSW refreshed its Enterprise Risk Management (ERM) system and framework during 2015/16 and continuously improved it, ensuring that risk identification, analysis and monitoring occurred across all lines of business and in relation to key projects throughout the financial year.

The agency introduced a new ERM system to support operational monitoring of risks in July 2016. GPNSW recalibrated its risk identification, assessment and escalation policies and conducted a refresh of its Divisional risk registers between October 2015 and February 2016.

GNSW’s ERM framework considers risks at the strategic and operational level, as well as within programs and projects. Strategic risks deemed to possess a high rating were required to be reported to the GPNSW Executive Operating Committee and/or escalated to DFSI and the Audit and Risk Committee, in accordance with risk incident and escalation processes.

The ERM system and framework is aligned to the DFSI Risk and Resilience Framework, to NSW Treasury Internal Audit and Risk Management Policy for the Public Sector (TPP 15-03) and AS/NZS ISO 31000: Risk management – Principles and Guidelines.

Insurance In the reporting period, GPNSW was insured with the Treasury Managed Fund, which is managed by the NSW Self Insurance Corporation.

Audit and Risk Committee (ARC) During 2015/16 GPNSW had in place an Audit and Risk Committee (ARC), compliant with NSW Treasury’s Internal Audit and Risk Management Policy for the NSW Public Sector (TPP 15-03).

This committee met five (5) times over the course of 2015/16 to oversee financial reporting, internal control systems, risk management, annual reporting, Audit Office reports and early close, and the internal and external audit functions. Administrative support for the ARC was provided by the DFSI. The ARC considered issues and topics including:• reports of GPNSW progress against Strategic Priorities and progress of PAUT II recommendations• corporate plan, objectives and performance management framework and updates on restructure

including the transition of Sydney Harbour Foreshore Authority and repositioning activities in advance of consolidating into a new entity (Property NSW) post 1 July 2016


87

• financial performance reports, including the property revaluations and other projects and matters relevant to GPNSW financial performance

• GPNSW Internal Audit Plan, reports and implementation of recommendations• NSW Audit Office reports and GPNSW implementation of recommendations• financial statements – the ARC had separate meetings to review soft close and hard close of financial

statements, and a meeting to approve financial accounts for 2015/16.

Internal Audit and Risk Management Statement 2015/16I, Brett Newman, am of the opinion that the Audit and Risk Committee for Government Property NSW is constituted and operates in accordance with the independence and governance requirements of Treasury Policy NSW TPP 15-03. The Chair and Members of the Audit and Risk Committee were:

For the period 1 July 2015 to 20 Nov 2015• Jon Isaacs, Independent Chair (period of appointment 31 October 2011 to 31 October 2015)• Ken Barker, Independent Member (period of appointment from 31 October 2014 to 20 November 2015)• Evelyn Bosak, Independent Member (period of appointment from 27 October 2013 to 27 October 2016)

For the period 20 November 2015 to 30 June 2016• Carol Holly, Independent Chair (period of appointment 2 December 2015 to 2 December 2020)• Dianne Hill, Independent Member (period of appointment 1 February 2016 to 1 February 2019)• Mark O’Sullivan, Independent Member (period of appointment 25 January 2015 to 25 January 2017)

This Audit and Risk Committee has been established under a Minister approved shared arrangement for 2015/16 with the following statutory bodies:• Teacher Housing Authority• Waste Assets Management Corporation• Sydney Harbour Foreshore Authority (post 8 January 2016)• Luna Park Reserve Trust (post 8 January 2016)

These processes, including the practicable alternative measures implemented, provide a level of assurance that enables the senior management of GPNSW to understand, manage and satisfactorily control risk exposures.

As required by the policy, I have submitted an Attestation Statement outlining compliance with exceptions with the policy to the Treasury on behalf of the Treasurer.

Brett NewmanChief Executive OfficerGovernment Property NSW


88

Public informationPublic Interest DisclosureAs staff are employees of DFSI, GPNSW has adopted and adhered to the DFSI Fraud and Corruption Internal Reporting Policy. All staff are advised of this policy by means of the Code of Conduct and intranet access.

Public interest disclosures made by GPNSW officials for the period 1 July 2015 to 30 June 2016

Privacy and Personal Information Protection Act 1998 (PPIP Act)The Privacy and Personal Information Protection (PPIP) Act 1998 contains twelve information protection principles regulating the collection, use and disclosure of personal information by NSW public sector agencies. These principles ensure that agencies collect personal information for lawful purposes, and that such information is protected from misuse and unauthorised release.

NSW Government agencies are required to prepare and implement a privacy management plan in accordance with section 33(1) of the Privacy and Personal Information Protection Act 1998.

Additional information about how GPNSW manages its obligations under the PPIP Act is available at http://www.property.nsw.gov.au/government-property-nsw-privacy-statement.

Statistical information about access applications received in relation to GPNSW is reported in the DFSI Annual Report.

(1) Public interest disclosures made by public officials in performing their day to day functions

(2) Public interest disclosures not covered by (1) that are made under a statutory or other legal obligation

(3) All other public interest disclosures

Number of public officials who made PIDs

0 0 0

Number of PIDs received 0 0 0

Of PIDs received, number primarily about:

Corrupt conduct 0 0 0

Maladministration 0 0 0

Serious and substantial waste 0 0 0

Government information contravention

0 0 0

Local government pecuniary interest contravention

0 0 0

Number of PIDs finalised 0 0 0


89

Government informationGovernment Information (Public Access) Act 2009The Government Information (Public Access) Act 2009 (GIPA Act) requires NSW Government agencies to make mandatory disclosures of information, encourages proactive releases of information and provides mechanisms for individuals to apply to access government information.

More information on how to access department information is available athttps://www.finance.nsw.gov.au/accessing-ofs-information/how-can-i-access-ofs-information.

Statistical information relating to formal applications under the GIPA Act is provided in the DFSI Annual Report Government Information (Public Access) statistics.

Review of proactive release programUnder section 7(3) of the GIPA Act, agencies must review their proactive release of government information program at least once every twelve months.

GPNSW complies with this Act by proactively releasing information on its website www.property.nsw.gov.au.

Digital Information Security Annual Attestation Statement 2015/16I, Brett Newman, am of the opinion that Government Property NSW had an Information Security Management System (ISMS) in place during the 2015/16 financial year that is consistent with the Core Requirements set out in the NSW Government Digital Information Security Policy.

The controls in place to mitigate identified risks to the digital information and digital information systems of Government Property NSW are adequate.

There is no agency under the control of Government Property NSW which is required to develop an independent ISMS in accordance with the NSW Government Digital Information Security Policy.

Brett Newman Chief Executive Officer Government Property NSW


90

Exemptions and nil reportsGPNSW is exempt from reporting on the following matters for the reasons outlined below:

End of Government Property NSW’s statutory information 2015/16.

Reporting requirement Reason for exemption

Funds granted to non-government organisations

GPNSW did not make any grants to any non-government community organisations during the reporting period.

Research and development No research and development activities were undertaken during 2015/16.

Disclosure of controlled entitiesGPNSW does not control any entities of the kind referred to in section 39 (1A) of the Public Finance and Audit Act 1983.

Disclosure of subsidiariesGPNSW does not control or hold shares in any subsidiaries within the meaning of the Corporations Act 2001 (Cth.).

Agreements with Multicultural NSWGPNSW does not have any agreements with Multicultural NSW under the Multicultural Act 2000.

Investment performance

All GPNSW investment powers are in accordance with Part 1 of Schedule 4 of the Public Authorities (Financial Arrangements) Act 1987. However, all cash reserves are held in Treasury Banking System (TBS) bank accounts.

Liability management performanceNot applicable, as GPNSW does not have a level of debt greater than $20m.

Implementation of price determinationGPNSW is not subject to determinations or recommendations of the Independent Pricing and Regulatory Tribunal of NSW.

Land disposalGPNSW did not dispose any land with value more than $5 million, except by way of public offering, such as auction, Expression of Interest or tender during 2015/16.

Sydney Harbour Foreshore Authority 2015–16

91

• Sydney Harbour Foreshore Authority financial statements for the year ended 30 June 2016 • Sydney Harbour Foreshore Authority statutory information• Luna Park Reserve Trust financial statements for the year ended 30 June 2016

Sydney Harbour Foreshore Authority

Appendix B


92

Dear Minister

Letter of submission

I am pleased to submit to you, for presentation to Parliament, the Sydney Harbour Foreshore Authority Annual Report for the year ended 30 June 2016.

The report has been prepared in accordance with the Annual Report (Statutory Bodies) Act 1984, the Public Finance and Audit Act 1983 and the regulations under those Acts.

Sam RomaniukChief Executive OfficerSydney Harbour Foreshore Authority

The Hon. Helen CoonanChairSydney Harbour Foreshore Authority Board


93

• Financial statements for the year ended 30 June 2016



94


95


96


97


98


99


100


101


102


103


104


105


106


107


108


109


110


111


112


113


114


115


116


117


118


119


120


121


122


123


124


125


126


127


128


129


130


131

• Statutory information



132

Transition to Property NSWOn 1 July 2015, Sydney Harbour Foreshore Authority (SHFA) employees were transferred from the Department of Planning and Environment to the Department of Finance, Services and Innovation.

On 28 September 2015, the NSW Government announced that SHFA’s functions would be consolidated into existing expert whole-of-government agencies, including Property NSW and Destination NSW.

It was also announced that $200 million of funding will be reserved in the Restart NSW Fund for the upgrade of the Circular Quay wharves, with funds generated from the sale of SHFA’s assets that have been identified for divestment, including certain hotels and commercial office property.

From the date of the announcement, SHFA – as the Place Management division – became part of Property NSW within the Department of Finance, Services and Innovation and a transition period for the consolidation commenced.

SHFA remains an entity under its Act, serviced by Place Management and Property NSW.

More information on the Place Management division can be found in the Property NSW Annual Review 2015/16.

Our CharterSydney Harbour Foreshore Authority (SHFA) was formed in 1999 under the Sydney Harbour Foreshore Authority Act 1998 to consolidate the work and functions of City West Development Corporation, Darling Harbour Authority and Sydney Cove Authority.

Aims and objectivesUnder its Act, SHFA is responsible for Sydney’s most historically and culturally significant waterfront locations. These responsibilities include the care, protection, management and promotion of this land and its important buildings.

Property NSW’s Place Management division supports SHFA’s responsibilities as the State’s premier place making agency. It owns, manages and transforms Sydney’s key State-significant heritage and cultural precincts—The Rocks and Darling Harbour—into vibrant, welcoming places that support, sustain and inspire locals and visitors.

Every year the Place Management division brings Sydney’s foreshore to life in The Rocks and Darling Harbour with a colourful mix of some of the city’s biggest and most popular events. The division also cares for the natural and built environments that make the precincts the popular destinations they are today—together they attract more than 40 million* people annually.

On behalf of SHFA, Place Management manages significant commercial and retail leases, provides security, cleaning, building maintenance and other asset management services, and cares for the public domain and over 100 heritage items.


133

SHFA also holds ownership of State-significant sites including Ballast Point, and manages other major waterfront assets around Sydney Harbour on behalf of other agencies, such as King Street Wharf. It owns land, parks, wharves and boardwalks at Pyrmont and is responsible for 19 head leases, 32 licences and 63 tenancies throughout Darling Harbour (including berthing licences), and 207 leases, 67 licences and 200 market stall holders in The Rocks.

SHFA also manages the Luna Park Reserve Trust.

*See People movements and how visitors are counted, following.

People movements and how visitors are countedElectronic people counters are installed in key locations in The Rocks and Darling Harbour.

The counters emit an infrared beam and each time a pedestrian breaks the beam a people movement is registered. Calibration and expansion calculations are applied to raw counts to ensure that final figures estimate total pedestrian flow. These figures include repeat visits made by visitors, workers and residents.

Monthly people movements in The Rocks and Darling Harbour

In The Rocks, approximately 14.5 million people movements were recorded in 2015/16, with people enjoying the entertainment, shopping and dining experiences on offer. This was an increase in people movements of 2.5 per cent on the previous year.

In Darling Harbour, approximately 25.9 million people movements were recorded in 2015/16, with people enjoying cultural festivals, attractions and events in the precinct. This was a decrease in people movements of only 0.6 per cent on the previous year – an important achievement, given the significant transformation underway in the precinct.

0.0

0.5

1.0

1.5

2.0

2.5

3.0

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun

Peop

le m

ovem

ents

(mill

ions

)

2015-16

Monthly people movements in The Rocks and Darling Harbour

The Rocks Darling Harbour


134

Management and structureRole of the Board SHFA’s Board is appointed in accordance with the Sydney Harbour Foreshore Authority Act 1998. The Board oversees SHFA’s policies, management and performance, sets strategic direction for the entity and monitors compliance with statutory requirements. The Board monitors organisational performance against strategic objectives. This is achieved both through written reports from management and direct interaction with senior management at quarterly Board meetings.

The Code of Conduct for Board Members prescribes procedures for disclosing and dealing with conflicts of interest.

As per recommendation 2.1 of TPP 09-2, a Board Charter is currently being developed.

The NSW Minister for Finance, Services and Property is responsible for the control and direction of SHFA.

SHFA’s CEO is responsible for the day-to-day management of SHFA in accordance with specific policies and general direction of the Board, and is subject to the control and direction of the Minister.

Board From 1 July 2015, SHFA’s Board consisted of Chair, The Hon Helen Coonan, and Board members Brett Newman, Deputy Secretary, Property NSW, Martin Hoffman, Secretary, Department of Finance, Services and Innovation, along with SHFA’s Chief Executive Officer, Sam Romaniuk, as an ex-officio Board member.

Board meetings and attendanceSeven Board meetings were held in 2015/16. Dates and attendees are outlined in the table below.

Attendees 14 Jul 2015

29 Jul 2015

15 Sep 2015

23 Sep 2015

18 Dec 2015

24 Mar 2016

30 Jun 2016

TOTAL

The Hon. Helen Coonan Yes Yes Yes Yes Yes Yes Yes 7/7

Catherine Gallagher Yes Yes Yes Yes Yes - - 5/5

Sam Romaniuk - - - - - Yes Yes 2/2

Brett Newman Yes Yes Yes Yes Yes Yes Yes 7/7

Anthony Lean (A/Secretary DFSI, prior to Martin Hoffman commencing)

Yes Yes - - - - - 2/2

Martin Hoffman - - Yes Yes Yes Yes Yes 4/5


135

The Hon. Helen CoonanBA, LLB

Board memberChair, Sydney Harbour Foreshore Authority Co-chair, GRACoswaySydney Opera House TrustChair, Crown Resorts FoundationObesity Australia

Non-Executive DirectorCrown Resorts LimitedSnowy Hydro Limited

Advisory BoardAon Risk Services Pty LimitedJ.P. Morgan

Appointed as the Sydney Harbour Foreshore Authority Chair from 1 July 2015 for a period of one year. Reappointed from 4 August 2016 for a period of one year.

Brett NewmanMBA, LLM, LLB, BEcDeputy Secretary, Property and Advisory GroupChief Executive Officer, Government Property NSW

Board memberSydney Harbour Foreshore Authority

Appointed as a Sydney Harbour Foreshore Authority Board member on 22 June 2015 for a period of two years.

Martin HoffmanMBA (Hons), MAppFin, BEconSecretary, Department of Finance, Services and Innovation


Pursuant to the Sydney Harbour Foreshore Authority Act 1998, the Secretary of the Department is an ex-officio Board member.

Sam RomaniukB.Com, LLB, ACAChief Executive Officer, Sydney Harbour Foreshore AuthorityExecutive Director, Place Management, Property NSW


Appointed as Chief Executive Officer 22 December 2015. Pursuant to the Sydney Harbour Foreshore Authority Act 1998, the Chief Executive Officer is an ex-officio Board member.


136

Changes to the Executive in 2015/16Catherine Gallagher, Chief Executive Officer, Sydney Harbour Foreshore Authority, left the service in December 2015 and Sam Romaniuk was appointed Chief Executive Officer on 22 December 2015.

For more information about Property NSW’s Executive team, refer to Property NSW’s Annual Review 2015/16.

Executive team – up to and including SHFA’s integration period into Property NSW

Catherine GallagherChief Executive Officer The Chief Executive Officer is responsible for the day-to-day management of SHFA in accordance with specific policies and general direction of the Board.

Catherine Gallagher was appointed CEO of SHFA in December 2012. She joined the Authority in March 2005. Catherine brought more than twenty years’ experience across retail, marketing and communication, cultural policy and international relations, in both the public and private sectors, to the role of CEO.

Catherine had oversight of some of Sydney’s most loved and visited events and played a strong supportive role in bringing business events to NSW, in particular through her role on the Board of Business Events Sydney. Supporting this was her expertise in retail with a renewed focus on strategic leasing for the precincts.

Deborah DearingExecutive Director, Place RenewalThe Place Renewal division was responsible for the strategic planning, heritage management, and delivery of capital projects and infrastructure maintenance to support the ongoing revitalisation of SHFA’s precincts to provide economic and social returns to the State.

Deborah holds a PhD in Architecture and other post-graduate qualifications. In October 2014, the Minister for Environment and Heritage appointed Deborah to the Heritage Council of NSW.

Deborah has extensive senior executive experience in both government and large private sector organisations, with expertise in planning, urban design, architecture, environmental law and property development.

Deborah was appointed Executive Director, Place Renewal in July 2013.

Michelle WeissA/Executive Director, Place ManagementThe Place Management division includes event programming and delivery, operational management of the precincts including security and high quality amenity services, strategic communications and stakeholder engagement, ministerial services, marketing and commercial enterprise and partnerships.

Michelle has worked in the private and public sectors, is experienced in internal and external communications and also has extensive public policy development and operations experience. She has expertise in media and issues management, change management, corporate planning, crisis communications, stakeholder relations, promotions, events, customer service and ministerial services.

Michelle Weiss joined SHFA in August 2013 and acted as Executive Director, Place Management until May 2016, when Sam Romaniuk was appointed to the role in the new Property NSW structure.


137

Arthur TzortzisA/Executive Director, Place ServicesChief Financial OfficerDirector of Major AssetsThe Place Services division provided core business services to SHFA. This included information technology, finance, procurement, legal, risk management, property accounting, major assets management and human resources.

Arthur Tzortzis commenced at the Authority in 2003 and was Acting Chief Financial Officer from April 2010. Arthur is a graduate of the MBA program at the Australian Graduate School of Management (Graduate Diploma in Management and Graduate Certificate in Management), has a Bachelor of Economics and is a current member of the Australian Society of Certified Practising Accountants.

Arthur was appointed Chief Financial Officer in August 2013 and acted as Executive Director, Place Services since September 2014.

Funds granted to non-government community organisationsEach year, SHFA supports a diverse number of events which provide cultural experiences and community-based activities that enrich the lives of visitors to the precincts. These events help create the unique character of Darling Harbour and The Rocks.

SHFA continued its commitment to cultural organisations, community groups and commercial enterprises, developing, curating and coordinating numerous events in The Rocks and Darling Harbour during the year, including:• Chinese New Year celebrations• Chinese New Year Lantern Carnival• Sydney International Boat Show• Dragon Boat Spectacular• SmoothFM Festival of Chocolate• 33 school and community public performances• a substantial cultural program including 18 festivals from around the world. These festivals are among

Australia’s leading multicultural celebrations, where visitors explore various cultures through arts, history, entertainment and great food.

These events bring a rich mix of activities for visitors to enjoy and provide opportunities for tenants to participate.

SHFA was also a significant partner for a number of organisations and provided significant on-the-ground operational support, in addition to the following funding:• Vivid Sydney ($660,000)• Sydney Festival ($150,000)• City of Sydney New Year’s Eve ($100,000)• NSW Wheelchair Sports ($15,000)• NSW Tourism Awards ($10,000)• Community and Cultural Festivals ($220,000 value-in-kind).


138

Legal change There were no changes to SHFA’s legislation during 2015/16.

Human resources As at 30 June 2016, the Authority had a total of 115 ongoing employees and 17 temporary employees.

There were no exceptional movements in wages, salaries or allowances, except for increases awarded across the public sector by the Industrial Relations Commission.

There were no industrial disputes lodged by the NSW Public Service Association with the Industrial Relations Commission of NSW. There was no working time lost due to industrial disputes during the year.

Requirements arising from employment arrangementsThere were no additional requirements for SHFA.

Workforce profile

* Figures do not include casual employees. Part-time employees are counted as one.

The average total remuneration package of senior executives at the end of the 2015/16 reporting period was $172,632 (note, the average includes Senior Officer levels and Professional Officer Level 4 only; as at 30 June 2016, SHFA did not have any employees appointed to Executive roles, therefore they are not included in this figure).

The percentage of total employee-related expenditure in the reporting year that relates to senior executives is 25.4%.

Salary scale

30 June 2013 30 June 2014 30 June 2015 30 June 2016

Total number of employees

Women Non English

speaking background


Women Non English

speaking background


Women Non English

speaking background


Women Non English

speaking background

Salaries below clerical officer grade 1; 21 year old or equivalent

0 0 0 0 0 0 0 0 0 0 0 0

Salaries from clerical officer grade 1; 21 year old rate to below minimum clerk grade 1 rate or equivalent

1 0 0 0 0 0 0 0 0 0 0 0

Grade 1–2 or equivalent

18 5 5 12 3 2 12 5 2 9 3 2


15 10 2 10 9 3 16 14 5 16 14 5.3


53 30 3 54 29 2 42 23 1 46 27 3.1


43 14 4 45 18 6 40 15 3 36 16 4

Above grade 12 or equivalent

34 11 4 42 18 1 38 16 2 29 11 2.1

Total number of employees in established* positions

164 70 18 163 77 14 148 73 13 136 71 16.5


139

Senior Executive Service profile

Note: during the Restructure Management Plan, two Executive Director roles (SES 3 and SES 4) were occupied by use of contingency measures; Executive roles have been recruited and all are GSE compliant.

Note: substantive contracted Executive positions are reported, so that numbers are not inflated.

Senior Executive Service remuneration

Workforce diversity In 2015/16, SHFA continued to promote Workforce Diversity and equal employment opportunity (EEO) through ongoing merit selection training, which was undertaken to ensure equity principles continue to be incorporated in recruitment and selection.

Equity principles also continue to be promoted through SHFA’s Code of Conduct, including through induction sessions for new employees and ethics training for existing employees.

Trends in the representation of EEO groups among SHFA employees are shown in the tables following.

SHFA has a large pool of staff who support operations across events and activations, and act as tour guides and interpretation officers at The Rocks Discovery Museum and the Chinese Garden of Friendship in Darling Harbour. As these roles are classified ‘casual’, they are not reflected in the statistics below.

During the year, SHFA exceeded its primary diversity goal, surpassing its benchmark 50 per cent for females at 55.2 per cent and closer, also, to its benchmark for ‘people whose first language spoken as a child was not English.’

2012/13 2013/14 2014/15 2015/16

Number of SES positions 5 4 4 5

Number filled by females 1 3 3 0

Positions at SES Level 6 1 1 1 1





2015 2016

Senior Executive BandRange $

Average remuneration $

Range $Average

remuneration $

Band 4 (Secretary) 430,451 - 497,300 441,201 - 509,750

Band 3 (Deputy Secretary) 305,401 - 430,450 313,051 - 441,200

Band 2 (Executive Director) 242,801 - 305,400 248,851 - 313,050

Band 1 (Director) 170,250 - 242,800 174,500 - 248,850 172,632


140

Trends in representation of EEO groups

Trends in the distribution of EEO groups

Personnel policies and practices During the reporting period, SHFA was governed by the policies and procedures of the Department of Finance, Services and Innovation (DFSI).

In 2015/16, the Human Resources functions of Recruitment, Induction, Training and Development, and Payroll were managed by DFSI, to reflect the centralised corporate services model under the agency cluster.

Multicultural initiatives The organisation’s workforce reflects the social diversity of the general workforce and significantly, this diversity is represented at all levels.

SHFA recognises that embracing multiculturalism and community relations builds leadership, supports organisation growth, facilitates collaboration and partnerships and creates social inclusion. In 2015/16, SHFA:

• had its draft Reconciliation Action Plan (RAP) endorsed by Reconciliation Australia, which aims to ensure that Aboriginal and Torres Strait Islander heritage and cultures and the principles of reconciliation are incorporated into the work that SHFA does

• for the third year in a row, continued the Language on Land program for NAIDOC Week in July 2015; by encouraging tenant participation and displaying the Gadigal people’s traditional name for The Rocks, Tallawoladah, throughout the precinct, the project aims to put Aboriginal language back on land and celebrates the ongoing existence of Aboriginal people in Sydney. In 2016, the names Meeliyahwool (Campbells Cove) and Tar-ra (Dawes Point) were also introduced

• finalised the process to rename the lawn area on the eastern side of the Museum of Contemporary Art, Circular Quay, Tallawoladah Place, endorsed by The Geographical Names Board of NSW

% of total staff (excl. casuals)


Women 50 47.2 49.3 55.2


2.6 1.2 0 0


19.0 8.7 8.9 12.1

People with a disability N/A 0.6 0.7 0.7

People with a disability requiring work-related adjustment

1.5 0 0 0


Women 100 97 93 93


100 N/A N/A N/A


100 N/A N/A N/A


141

• continued to nurture its relationship with the Chinese community by hosting Chinese New Year celebrations at the Chinese Garden of Friendship and Darling Harbour

• connected with young people by hosting Santa Fest—an family-friendly Christmas celebration in Darling Harbour in November and December, which also supports the Starlight Children’s Foundation—and the Sydney Children’s Festival in The Rocks in March 2016

• developed and publicly released an Aboriginal walking tour of The Rocks app, with leading Aboriginal filmmakers, writers and musicians, which aims to tell Aboriginal stories, past and present

• completed the first of a potential three-year Darling Harbour Community Cultural Festivals emerging artist development program in partnership with Arts NSW.

SHFA’s annual calendar of events is filled with festivals that celebrate Australia’s rich heritage and cultural diversity, promoting social cohesion and community harmony. These events, like the Thailand Grand Festival in March, also provide economic benefit to Sydney and deliver platforms to showcase multicultural Sydney to the world. Despite the redevelopment of Tumbalong Park and subsequent loss of this significant event space for much of the year, SHFA continued to support the delivery of 18 community and cultural festivals in Darling Harbour.

Additionally, the Authority’s websites promoting The Rocks and Darling Harbour are integrated with Google Translate, making content available in more than 60 supported languages to ensure that information can be accessed around the world.

Disability inclusion action plans SHFA’s Disability Inclusion Action Plan focuses on improving readily identifiable physical access issues, improving staff training, ensuring compliance with the Disability Discrimination Act 1992 (DDA) and formalising complaints procedures.

Initiatives undertaken during the year included:• completion of a new compliant ramp from Hickson Road into Bays 4 and 5 of the ASN building in The

Rocks• completion of a concept design for incorporating public access into the commercial lease space in the

The Rocks’ Cleland Bond building in preparation for a new tenant; the design will provide public access between Cambridge Walk and Playfair Street via the existing lift

• completion of access improvements to 80 George Street as part of the adaptation of a former restaurant lease space

• continued ongoing consultation with NSW Roads and Maritime Services for the proposed fully compliant access lift from The Rocks to the Sydney Harbour Bridge pedestrian walkway

• actively reviewing, improving and managing access and inclusion viewing opportunities for New Year’s Eve through the provision of suitable locations, accessible temporary toilets, dedicated drop off zones and managed access for those persons or groups with a disability

• continuing to use House with No Steps for the grounds maintenance contract for all Pyrmont parks and Ballast Point Park

• sponsoring the Oz Day 10k wheelchair race, demonstrating SHFA’s engagement with activities that improve and promote the health and welfare of disability groups.


142

Work health and safety (WHS)In 2015/16, SHFA continued to take a proactive approach in managing the work health and safety (WHS) of all employees, other workers and visitors to its properties, sites and activations.

Specific activities undertaken by SHFA during the year include:• implementing the recommendations of the shoreline risk assessment • participating in Safe Work Australia Safety Week• a review of trading table arrangements at Argyle Stores• a review of hazardous chemicals storage, including LPG tenant storage requirements • conducting training for all contract managers in SHFA’s online contractor induction system, Visitor Rego,

and undertaking induction for site visitors• reviewing and improving emergency evacuation procedures at Scarborough House, The Rocks.

With the amalgamation of SHFA into Property NSW and the Department of Finance, Services and Innovation (DFSI), work has also been undertaken to assist a review of the DFSI Safety Management System, which will replace the SHFA Safety Management System. A gap analysis of Government Property NSW WHS requirements has also been undertaken, to ensure a consistent approach in the delivery of WHS activities and information across the cluster.

During the period 2015/2016, there were 11 incidents reported, resulting in four claims reported under the SHFA workers compensation policy. There were no serious / notifiable incidents affecting staff.

WHS induction and training All relevant SHFA staff completed the mandatory e-learning modules, WHS awareness for staff and WHS for managers.

In January 2016, the Visitor Rego online Contractor Induction Program was launched. Since its inception, it has proved to be an effective resource for ensuring contractors are appropriately inducted onto SHFA sites.

As of 1 July 2016, the DFSI myCareer portal will replace SHFA’s WHS e-learning courses for employees and managers.

WHS consultation The WHS Consultative Committee has been active in the management of WHS issues. In 2015/16, the committee completed eight workplace inspections and implemented safety management initiatives for emergency evacuations, roof access and personal protective equipment.

Consumer responseSHFA, as part of Property NSW, responded efficiently and effectively to feedback from customers, tenants and visitors to its precincts. During the year a total of 19,222 reports, requests, compliments and complaints were captured through the Customer Request Management System (CRMS).

This system was linked to a dedicated Customer Service Request Line which operated 24 hours, seven days a week and allowed Property NSW to identify key trends and issues within its precincts and respond accordingly.

Complaints received through the system related to various matters, including busking, noise and the removal of rubbish. Property NSW responded quickly and equitably to CRMS complaints, completing 91 per cent of all requests on time.


143

Additionally, Property NSW encouraged feedback from the general public via an online platform on its corporate website and responded to 772 emailed compliments, complaints and enquiries captured through this system. In 2015/16, Property NSW captured 13,608 posts on Darling Harbour Facebook and 4,025 posts on The Rocks Facebook. It also actioned 311 enquiries via the Darling Harbour website and 265 enquiries via The Rocks website.

Property NSW used feedback received during the year to improve customer service levels, including service delivery in its precincts.

Waste reduction initiatives SHFA continued to implement a number of waste reduction and recycling initiatives during the year, including:• utilising recycling bins—including organic, co-mingled, and paper and cardboard—in all office kitchens• installing additional recycling bins during events to encourage visitors to recycle• using recyclable, bioplastic, carbon-neutral coffee cups for The Rocks Aroma Festival, which contained

messages encouraging users to recycle• providing water refill stations at major events• encouraging tenants to use the organic food processor in The Rocks Centre shared waste facility to

process food waste, diverting it from landfill• implementing successful digital and social media marketing to promote events, reducing printed marketing

material.

More information on Property NSW’s waste reduction initiatives under the NSW Government Resource Efficiency Policy (GREP) can be found in Property NSW’s Annual Review 2015/16.

Procurement accreditationChanges to NSW Government procurement practices launched in 2012 included a requirement that all government agencies be accredited by the NSW Procurement Board for goods and services procurement to various levels based on assessed procurement capability.

SHFA underwent an extensive external assessment process and has accordingly received Level 2B accreditation.

This enables SHFA to conduct its own procurement activities for contracts up to a value of $20 million, independent of the NSW Procurement branch of the Office of Finance and Services.


144

ConsultantsSHFA engages consultants for specialised work on an as needed basis, including for economic appraisals, financial services and planning advice. In 2015/16, SHFA engaged one consultant whose fees were $50,000 or more, as shown in the table below. These fees totalled $50,000 excluding GST.

Forty four (44) consultants whose fees were less than $50,000 were also engaged, with fees totalling $501,361.12 excluding GST.

Services provided by these consultants included advice on:• feasibility studies and the Expression of Interest process for 86–88 George Street, The Rocks (Phase 1)• a business case, and related peer review, to consider future usage options for 86–88 George Street and

1–5 and 7 Atherden Street, The Rocks• a review of SHFA’s business resilience framework• a financial offer analysis for the IMAX in Darling Harbour • BCA compliance for 1–5 Hickson Road, and BCA planning approval advice on the upgrade of the Cleland

Bond Store, The Rocks• the provision of SICEEP accounting requirements • a view study analysis for the response to the NSW Heritage Council regarding the proposed Sydney

Harbour Bridge Lift.

Credit card certification SHFA has a Corporate Credit Card Policy that complies with NSW Treasury’s Treasurer’s Directions. Cardholders are required to observe the policy and complete a reconciliation form each month, which is authorised by SHFA’s Chief Financial Officer or CEO.

SHFA currently has one credit card on issue with a limit of $5,000.

Contractor Contract title Category Value

Deloitte Access EconomicsEconomic appraisal of 86–88 George Street and 1–5 & 7 Atherden Street, The Rocks

Finance / Property $50,000

Total $50,000


145

Payment of accounts for goods and services Aged analysis at the end of each quarterAged analysis at the end of each quarter

Current (i.e. within due date)

$'000

Less than 30 days overdue

$'000

Between 30 and 60 days

overdue $'000

Between 61 and 90 days

overdue $'000

More than 90 days overdue $'000

All Suppliers

September 2015

2,045

46

42

-

-

December 2015

1,588

52

44

12

-

March 2016

1,894

43

-

-

-

June 2016

4,780

39

1

175

-

Small Business Suppliers

September 2015

413

8

-

-

-

December 2015

229

6

-

-

-

March 2016

166

-

-

-

-

June 2016

843

16

-

-

-


146

Accounts due or paid within each quarter

CommentaryOn time payment was impacted by the implementation of a new financial system, SAP by Design, from 1 July 2015.

Automated monitoring and reporting of accounts ensures that all accounts are tracked from the time the invoice is officially received by SHFA. Accounts over 15 days appear on a weekly report and are followed up by Accounts.

There were no instances in 2015/16 where penalty interest was incurred.

Accounts due or paid within each quarter

Measure September 2015

December 2015

March 2016

June 2016

All Suppliers

Number of accounts due for payment 2,919 3,514 3,499 3,087

Number of accounts paid on time 2,614 3,192 3,160 2,869

Actual percentage of accounts paid on time (based on number of accounts)

89.6% 90.8% 90.3% 92.9%

Dollar amount of accounts due for payment

39,732,505 47,096,916 41,220,747 35,137,762

Dollar amount of accounts paid on time 38,087,288 45,075,014 39,252,458 34,148,078

Actual percentage of accounts paid on time (based on $)

95.9% 95.7% 95.2% 97.2%

Number of payments for interest on overdue accounts

- - - -

Interest paid on late accounts - - - -

Small Business Suppliers Number of accounts due for payment to small businesses 440 520 497 375

Number of accounts due to small businesses paid on time

440 520 496 375

Actual percentage of small business accounts paid on time (based on number of accounts)

100.0% 100.0% 99.8% 100.0%

Dollar amount of accounts due for payment to small businesses

2,296,979 3,479,791 3,047,040 2,602,078

Dollar amount of accounts due to small businesses paid on time

2,296,979

3,479,791

3,044,073

2,602,078

Actual percentage of small business accounts paid on time (based on $)

100.0% 100.0% 99.9% 100.0%

Number of payments to small business for interest on overdue accounts

- - - -

Interest paid to small businesses on late accounts

- - - -


147

Public Interest Disclosures SHFA had no public official make a public interest disclosure in 2015/16.

SHFA has a Public Interest Disclosure Reporting Policy, which is available on the intranet and was communicated to staff.

Privacy and Personal Information ActSHFA has developed a Privacy Management Plan in response to the Privacy and Personal Information Protection Act 1998. The Act aims to protect the privacy of individuals from inappropriate collection, storage, use and disclosure of personal information by NSW public sector agencies. The Privacy Management Plan is available on the Property NSW website.

The plan is based on 12 information principles that establish standards for using personal information in an open and accountable manner. The information protection principles apply to all employees, consultants and contractors engaged by SHFA.

There were no privacy complaints received during 2015/16.

Government Information (Public Access) SHFA’s program for the proactive release of information involves ensuring compliance with the objectives of the Government Information (Public Access) Act 2009 and assessing disclosure of information against the requirements of the Act.

During the year, SHFA reviewed this program by revising its publication register, reviewing data in relation to decisions to assess whether information was being proactively and informally disclosed, and regularly reviewing the publications and resource centre on its corporate website.

As a result of this review, SHFA released the following information proactively:• updated policy documents• organisational information• SHFA-produced publications• contracts SHFA has entered into with the private sector.

SHFA received a total of 21 formal access applications (including withdrawn applications but not invalid applications). SHFA did not refuse any formal access applications.


148

The following tables show details of formal GIPA requests received by SHFA during 2015/16.

Table A: Number of applications by type of applicant and outcome

Table B: Number of applications by type of applicant and outcome

Table A: Number of applications by type of applicant and outcome

Access granted in full

Access granted in part

Access refused in full

Information not held

Information already available

Refuse to deal with application

Refuse to confirm / deny whether information is held

Application withdrawn

Media 0 0 0 0 0 0 0 0

Members of Parliament

0 0 0 0 0 0 0 0

Private sector business 6 1 0 0 0 0 0 3

Not-for-profit organisations or community groups

0 0

0 0 0 0 0 0

Members of the public (application by legal representative)

2 2 0 0 0 0 0 1

Members of the public (other)

4 0 0 1 0 0 0 1

Table B: Number of applications by type of applicant and outcome

Access granted in full

Access granted in part

Access refused in full

Information not held

Information already available

Refuse to deal with application

Refuse to confirm / deny whether information is held

Application withdrawn

Personal information applications

0 0 0 0 0 0 0 0

Access applications (other than personal information applications)

12 3 0 1 0 0 0 5

Access applications that are partly personal information applicants and partly other

0 0 0 0 0 0 0 0


149

Table C: Invalid applications

Table D: Conclusive presumption of overriding public interest against disclosure; matters listed in Schedule 1 of ActTable D: Conclusive presumption of overriding public interest against disclosure: matters listed in Schedule 1 Act

Number of times consideration used

Overriding secrecy laws 0

Cabinet information 0

Executive Council information 0

Contempt 0

Legal professional privilege 0

Excluded information 0

Documents affecting law enforcement and public safety 0

Transport safety 0

Adoption 0

Care and protection of children 0

Ministerial code of conduct 0

Aboriginal and environmental heritage 0

Table C: Invalid applications

Reason for invalidity Number of applications

Application does not comply with formal requirements (section 41 of the Act) 1

Application is for excluded information of the agency (section 43 of the Act) 0

Application contravenes restraint order (section 110 of the Act) 0

Total number of invalid applications received 1

Invalid applications that subsequently became valid applications 0


150

Table E: Other public intrest considerations against disclosure; matters listed in table to Section 14 of Act

Table F: Timeliness

Table E: Other public interest considerations against disclosure: matters listed in table to Section 14 of Act Number of occasions when

application not successful

Responsible and effective government 0

Law enforcement and security 0

Individual rights, judicial processes and natural justice 0

Business interests of agencies and other persons 3

Environment, culture, economy and general matters 0

Secrecy provisions 0

Exempt documents under interstate Freedom of Information legislation 0

Table F: Timeliness Number of applications

Decided within the statutory timeframe (20 days plus any extensions) 21

Decided after 35 days (by agreement with applicant) 0

Not decided within time (deemed refusal) 0

Total 21

Table E: Other public interest considerations against disclosure: matters listed in table to Section 14 of Act Number of occasions when

application not successful

Responsible and effective government 0

Law enforcement and security 0

Individual rights, judicial processes and natural justice 0

Business interests of agencies and other persons 3

Environment, culture, economy and general matters 0

Secrecy provisions 0

Exempt documents under interstate Freedom of Information legislation 0

Table F: Timeliness Number of applications

Decided within the statutory timeframe (20 days plus any extensions) 21

Decided after 35 days (by agreement with applicant) 0

Not decided within time (deemed refusal) 0

Total 21


151

Table G: Number of applications reviewed under Part 5 of the Act (by type of review and outcome)

Table H: Applications for review under Part 5 of the Act (by type of applicant)

Table G: Number of applications reviewed under Part 5 of the Act (by type of review and outcome) Decision varied Decision upheld Total

Internal review 0 0 0

Review by Information Commissioner 0 0 0

Internal review following recommendation under Section 93 of Act

0 0 0

Review by Administration Decisions Tribunal (ADT)

0 0 0

Total 0 0 0

Table H: Applications for review under Part 5 of the Act (by type of applicant) Number of applications for review

Applications by access applications 0

Applications by persons to whom information the subject of access application relates (see Section 54 of the Act)

0

Table G: Number of applications reviewed under Part 5 of the Act (by type of review and outcome) Decision varied Decision upheld Total

Internal review 0 0 0

Review by Information Commissioner 0 0 0

Internal review following recommendation under Section 93 of Act

0 0 0

Review by Administration Decisions Tribunal (ADT)

0 0 0

Total 0 0 0

Table H: Applications for review under Part 5 of the Act (by type of applicant) Number of applications for review

Applications by access applications 0

Applications by persons to whom information the subject of access application relates (see Section 54 of the Act)

0


152

Luna Park Reserve TrustLuna Park Reserve Trust is responsible for the care, control and management of the 3.13 hectares of Milsons Point that make up Luna Park Reserve.

Managed by SHFA, the Trust oversees a 40-year operating lease for the Luna Park site and manages the Heritage and Infrastructure Fund to conserve and improve the park’s heritage and infrastructure features.The Trust was established in 1990 when the Luna Park Site Act 1990 commenced under the Crown Lands Act 1989. Luna Park Reserve is dedicated under the Crown Lands Act for the purpose of public recreation, amusement and entertainment.

The Minister for Finance, Services and Property has administrative responsibility for these Acts as they relate to the Luna Park Reserve and oversees the Trust, any land dealings at Luna Park and its general administration.

The Minister for Planning is the consent authority for any development at Luna Park, which is listed as a Schedule 3 site (State significant) under State Environmental Planning Policy – Major Projects 2005.Luna Park Sydney Pty Ltd has complete operational responsibility for the day-to-day running of the park. The Trust works closely with Luna Park Sydney to ensure that the site remains a viable amusement park and entertainment precinct.

Luna Park Reserve Trust financial statements can be found on page 159.

Risk management and insurance activities SHFA saw a number of governance challenges in 2015/16, mainly relating to Government’s final conclusions regarding the future of SHFA. At the start of the financial year, SHFA was placed under the direct control of the Department of Financial Services and Innovation (DFSI). From 30 September 2015, a plan was instituted to progressively merge the substantive functions of SHFA with Government Property NSW (GPNSW) from 2016.

During the remainder of 2015, governance arrangements at SHFA were undertaken in-house. This included the management of SHFA-specific risks concerning its management of The Rocks and Darling Harbour precincts that were reported quarterly to the SHFA Audit and Risk Committee (ARC), the legislative compliance attestation and the NSW Treasury CFO Certification process. SHFA’s internal auditors, O’Connor Marsden, continued to examine the assurance controls according to the previously agreed 2015/16 audit plan. For 2016/17 and beyond, the internal audit function will become the responsibility of DFSI’s internal audit unit.

From January 2016, the transition of SHFA’s functions to GPNSW began with the merger of the Governance and ICT teams. From a risk management and insurance perspective, the focus became on the joint governance of both entities. In addition, from 30 November 2015, the NSW Treasury agreed to abolish the independent SHFA ARC and for DFSI to convene a committee that encompassed the entities that merged to form Property NSW. In February 2016, the new ARC met to consider the governance of the entities that form Property NSW. It subsequently met in April and May 2016.

Throughout 2015/16, SHFA faced risks relating to key project objectives, budgets and deadlines, government standards, laws and regulations, income or expenditure targets, delivery of services to internal and external customers, and the organisation’s reputation and brand in accordance with better practice guidelines laid out by the NSW Treasury and NSW Audit Office. In addition to this, the Governance team began to consolidate the risks of the combined agency from January 2016.


153

SHFA carries a comprehensive range of insurance cover through the Treasury Managed Fund (TMF). This insurance covers property, public liability, Directors’ insurance, and other contingencies. Unlike private-sector insurance policies, the TMF has limited exclusions. In particular, all properties owned or managed by SHFA are covered for their replacement value.

SHFA carries no officers’ professional liability insurance, however all public service officers are covered by a State indemnity against claims that do not involve negligence.

SHFA’s and Luna Park Reserve Trust’s Internal Audit and Risk Management Attestations can be found on the following pages.

See GPNSW’s 2015/16 Annual Report for more information about the GPNSW Audit and Risk Committee, and the GPNSW Internal Audit and Risk Management Attestation.


154


155


156


157


158

Digital Information Security Annual Attestation Statement 2015/16I, Sam Romaniuk, am of the opinion that Sydney Harbour Foreshore Authority had an Information Security Management System (ISMS) in place during the 2015/16 financial year that is consistent with the Core Requirements set out in the NSW Government Digital Information Security Policy.

The controls in place to mitigate identified risks to the digital information and digital information systems of Sydney Harbour Foreshore Authority are adequate.

There is no agency under the control of Sydney Harbour Foreshore Authority that is required to develop an independent ISMS in accordance with the NSW Government Digital Information Security Policy.

Sam RomaniukChief Executive OfficerSydney Harbour Foreshore Authority

Exemptions and nil reports SHFA is exempt from reporting on the following matters for the reasons outlined below.

End of Sydney Harbour Foreshore Authority’s statutory information 2015/16.

Reporting requirement Reason for exemption

Research and development No research and development activities were undertaken during 2015/16

Land disposalSHFA did not dispose of any land with a value more than $5 million except by way of public offering, such as auction, Expression of Interest or tender during 2015/16

Agreements with Multicultural NSW

SHFA does not have any agreements with Multicultural NSW

Implementation of price determination

SHFA is not subject to determinations or recommendations of the Independent Pricing and Regulatory Tribunal of NSW

Disclosure of SubsidiariesSHFA does not control or hold shares in any subsidiaries within the meaning of the Corporations Act 2001 (Cth.).

Promotion

SHFA CEO, Sam Romaniuk, undertook Minister-approved travel to the United States in May 2016. This was paid from the GPNSW Travel and Training budgets. Refer GPNSW report 2015/16 for more information.No other SHFA employees undertook overseas travel to promote or develop the business during the reporting period.

Investment performanceAll SHFA investment powers are in accordance with Part 1 of Schedule 4 of the Public Authorities (Financial Arrangements) Act 1987. However, all cash reserves are held in Treasury Banking System (TBS) bank accounts.

Liability management performance

Not applicable, as SHFA does not have a level of debt greater than $20m.

Luna Park Reserve Trust 2015–16

159

• Financial statements for the year ended 30 June 2016 – Luna Park Reserve Trust



160


161


162


163


164


165


166


167


168


169


170


171


172


173


174


175


176


177


178


179


180


181


182

Teacher Housing Authority of NSW Annual Report 2015–16

183

• Financial statements for the year ended 30 June 2016 • Statutory information

Teacher Housing Authority of NSWAnnual Report 2015–16

Appendix C

Teacher Housing Authority of NSW Annual Report 2015–16

184 This page intentionally left blank

TEACHER HOUSING AUTHORITY OF NEW SOUTH WALES

2015–16ANNUAL REPORT

1

ContentsContents 1

Purpose 2

Aims and objectives 2

Charter 2

Achievements in 2015–16 3

Focus for 2016–17 3

Chairpersons Report 4

Authority Membership 5

Members of the Authority 5

Chairperson 5

Deputy Chairperson 5

Members 5

Authority Meetings 6

Related Entity 6

Tenancy Services Management 7

Financial Management 11

Financial Performance 11

Capital Program 11

Land Owned or Occupied 11

Account Payment Performance 12

Credit Card Certification 12

Loan Facility 12

Benchmarking 12

Key Performance Indicators 12

Operating Results 12

Key Financial Statistics Four Year Trend 12

Performance against Budget 13

Account Payment Performance 14

Key Performance Indicators 15

Weekly Rental Amounts 15

Capital Delivery 16

Stakeholders 16

Human Resources 16

Other Activities 17

Appendices 20

Financial Statements 30

Notes 38

Index 56

Access to Services 57

The Hon. Dominic Perrottet MP

Minister for Finance, Services and Property

52 Martin Place

SYDNEY NSW 2000

Dear Minister

On behalf of the Teacher Housing Authority of New South Wales (THA), we take pleasure in presenting the following report on THA activities for the year ending 30 June 2016 for tabling in Parliament.

The report has been prepared in accordance with the Annual Reports (Statutory Bodies) Act 1984 and the regulations pursuant to this Act.

It also includes financial statements as required under the Public Finance and Audit Act 1983 as amended.

Brett Newman Chairperson

Philip Shelley General Manager 31 October 2016

2

Purpose Support the Department of Education (DE) to deliver education in New South Wales by providing teachers with a quality housing service, in rural and remote communities, where the private rental market is considered to be inadequate for their needs.

THA’s key result areas are:• Tenancy Services,

• Asset Management;

• Financial and Strategic Management.

Aims and objectivesThe aims and objectives of the THA are to provide:

• a responsive, dependable, empathetic and competent service;

• a high standard of housing stock;

• a relevant and efficient organisation covering all aspects of tenancy service and asset management; and

• an organisation that engages its workforce, creates a culture of continuous improvement, with appropriate resourcing and informed decision making.

CharterThe Teacher Housing Authority of New South Wales is a statutory corporation constituted under the Teacher Housing Authority Act 1975 (THA Act) as amended.

Under the Act, the principal object of THA is to provide and maintain suitable and adequate housing accommodation for teachers. THA also:

• initiates, promotes, commissions and undertakes surveys and investigations into the housing needs of teachers;

• undertakes, promotes and encourages research into the design, construction and maintenance of housing suitable for teachers;

• plans the provision of a comprehensive and coordinated housing service for teachers throughout rural and remote New South Wales;

• provides, conducts, operates and maintains a housing service for teachers; and

• advises and makes reports and recommendations to the Minister in respect of matters relating to the housing of teachers.

2

Purpose Support the Department of Education (DE) to deliver education in New South Wales by providing teachers with a quality housing service, in rural and remote communities, where the private rental market is considered to be inadequate for their needs.

THA’s key result areas are:• Tenancy Services,

• Asset Management;

• Financial and Strategic Management.

Aims and objectivesThe aims and objectives of the THA are to provide:

• a responsive, dependable, empathetic and competent service;

• a high standard of housing stock;

• a relevant and efficient organisation covering all aspects of tenancy service and asset management; and

• an organisation that engages its workforce, creates a culture of continuous improvement, with appropriate resourcing and informed decision making.

CharterThe Teacher Housing Authority of New South Wales is a statutory corporation constituted under the Teacher Housing Authority Act 1975 (THA Act) as amended.

Under the Act, the principal object of THA is to provide and maintain suitable and adequate housing accommodation for teachers. THA also:

• initiates, promotes, commissions and undertakes surveys and investigations into the housing needs of teachers;

• undertakes, promotes and encourages research into the design, construction and maintenance of housing suitable for teachers;

• plans the provision of a comprehensive and coordinated housing service for teachers throughout rural and remote New South Wales;

• provides, conducts, operates and maintains a housing service for teachers; and

• advises and makes reports and recommendations to the Minister in respect of matters relating to the housing of teachers.

3

TEACHER HOUSING AUTHORITY OF NEW SOUTH WALES – ANNUAL REPORT 2015–2016

Achievements in 2015–16Achievements Pages

• Completed the construction of 20 new residences, including ten ‘flexible accommodation’ units,a design that won the Secretary’s 2016 award for innovation. 10, 20

• Introduced Net Promoter Score as the method for measuring customer satisfaction.Achieving a score of +42 for the year to 30 June 2016. 9

• Sold 10 residences (9 properties) contributing $1.7 million towards future capital projects. 10

• Progressed with an innovative flexible design that provides accommodationto suit singles, couples or families. 20

• Implemented a new operating platform, SAPbyDesign, commissioned in time for the beginning of the2016–17 financial year, a platform that will improve financial reporting. 18

• Performed major works on 50 residences, at a cost of $2.2 million, improving the qualityand remaining useful life of these assets. 11

• Instigated a revised valuation exercise that reduced the cost of valuations and rental assessmentsallowing more to be invested in the portfolio. 39

• Continued to partner with the University of Sydney comparing the biophysical performance and achievedsatisfaction outcomes of the Broken Hill Eco Village against conventional residences in that town. 10

• Implemented a Strategic Asset Plan, one that offers teachers greater choice of where they can live, enhancingtheir experience while improving overall teacher utilisation and an improved ability to manage cost. 10

• Determined exposure to long-term maintenance expenditure based upon typical componentlifecycle and asset quality, supporting previous benchmarking analysis. 18

Focus for 2016–17• Continue implementing the Strategic Asset Plan, including the planning and construction of new residences

including flexible designs.

• Liaise with customers and stakeholder groups to ensure their expectations are met or exceeded, includinghosting a conference for local housing representatives.

• Further integrate with Property NSW to benefit from cost efficiencies and to offer development opportunitiesto employees.

4

Chairperson’s ReportTeacher Housing Authority (THA) has had a successful year, providing housing to more than 1,400 teachers in rural and remote NSW, where their needs cannot be met by the private market. This housing is vital to the provision of quality education services in these areas.

Throughout the year, we have focused on improving our customer service, delivering innovative new housing and practicing thorough asset and financial management. We have achieved significant outcomes in these areas.

The net promoter score, which measures customer satisfaction, is at a healthy positive 42. This result is particularly pleasing as, among other key performance indicators, the survey measures the service we provide to teachers who are new to our accommodation. The services THA provides play a key role in enabling teachers to have a positive experience in a new community.

Overall we invested almost $5 million building new residences in Wilcannia, Coonamble and Brewarrina, including eight flexible-design residences. This innovative design allows a duplex to be reconfigured as either two, two-bedroom units, or one three-bedroom house and one single-bedroom unit. The design is cost efficient and meets varying demand from singles, couples and families – providing opportunity to improve utilisation. The project team, led by Asset Manager, John Marsi, won a Secretary’s Award for innovation this year.

Additionally, THA performed major works on 50 residences, improving the quality and remaining life of these assets. Proceeds from the sale of 10 residences contributed $1.7 million towards future capital projects.

Significantly, we began implementing the Strategic Asset Plan we developed last year. Our plan offers teachers a greater choice of where they can live, enhancing their experience while improving overall asset and cost management.

This has been underpinned by cross-business projects to successfully implement SAPbyDesign and Objective, providing improved financial and records management and integration with Property NSW systems.

In 2016–17, we look forward to continually improving our customer service by hosting conferences for local housing representatives, and to further integrate with Property NSW to benefit from asset management and cost efficiencies.

I would like to acknowledge the valuable contribution of departing members Mark Anderson, Trish Webb and Deb Marten, and I extend a warm welcome to Kelly Edmunds, Richard Wiseman and Dennis Armstrong who will join Teacher Housing late in 2016. I also acknowledge the work and contributions of Mark Byrne and Katrina Jay who combined have served Teacher Housing for more than 20 years.

Finally, I would like to extend my appreciation to the staff at Teacher Housing who continue to be hard working and enthusiastic in their endeavours to provide a quality service that underpins the educational needs of children in rural and remote areas.

Brett Newman Chairperson Teacher Housing Authority

4

Chairperson’s ReportTeacher Housing Authority (THA) has had a successful year, providing housing to more than 1,400 teachers in rural and remote NSW, where their needs cannot be met by the private market. This housing is vital to the provision of quality education services in these areas.

Throughout the year, we have focused on improving our customer service, delivering innovative new housing and practicing thorough asset and financial management. We have achieved significant outcomes in these areas.

The net promoter score, which measures customer satisfaction, is at a healthy positive 42. This result is particularly pleasing as, among other key performance indicators, the survey measures the service we provide to teachers who are new to our accommodation. The services THA provides play a key role in enabling teachers to have a positive experience in a new community.

Overall we invested almost $5 million building new residences in Wilcannia, Coonamble and Brewarrina, including eight flexible-design residences. This innovative design allows a duplex to be reconfigured as either two, two-bedroom units, or one three-bedroom house and one single-bedroom unit. The design is cost efficient and meets varying demand from singles, couples and families – providing opportunity to improve utilisation. The project team, led by Asset Manager, John Marsi, won a Secretary’s Award for innovation this year.

Additionally, THA performed major works on 50 residences, improving the quality and remaining life of these assets. Proceeds from the sale of 10 residences contributed $1.7 million towards future capital projects.

Significantly, we began implementing the Strategic Asset Plan we developed last year. Our plan offers teachers a greater choice of where they can live, enhancing their experience while improving overall asset and cost management.

This has been underpinned by cross-business projects to successfully implement SAPbyDesign and Objective, providing improved financial and records management and integration with Property NSW systems.

In 2016–17, we look forward to continually improving our customer service by hosting conferences for local housing representatives, and to further integrate with Property NSW to benefit from asset management and cost efficiencies.

I would like to acknowledge the valuable contribution of departing members Mark Anderson, Trish Webb and Deb Marten, and I extend a warm welcome to Kelly Edmunds, Richard Wiseman and Dennis Armstrong who will join Teacher Housing late in 2016. I also acknowledge the work and contributions of Mark Byrne and Katrina Jay who combined have served Teacher Housing for more than 20 years.

Finally, I would like to extend my appreciation to the staff at Teacher Housing who continue to be hard working and enthusiastic in their endeavours to provide a quality service that underpins the educational needs of children in rural and remote areas.

Brett Newman Chairperson Teacher Housing Authority

5


Authority MembershipSeven members constitute the THA; four are appointed by the Governor, and three are ex officio.

Of the four members appointed by the Governor:

• one is nominated by the Minister for Familyand Community Services (and isDeputy Chairperson);

• one is nominated by the Secretary, DE, beingan officer of that department serving in thewestern or north-western region of the state;

• one is nominated by the Managing Director ofthe NSW TAFE Commission, being a seniorfinancial manager of that Commission; and

• one is nominated by the Minister forEducation on the recommendation of theNSW Teachers Federation.

Of the three ex-officio members:

• one is the nominee of the Secretary of theDepartment of Finance, Services andInnovation (DFSI), being an officer of thatdepartment (and is Chairperson);

• one is appointed by the Secretary, DE; and

• one is the THA General Manager.

Under the Teacher Housing Authority Act 1975, members are responsible for determining THA policies and ensuring the activities of the THA are carried out properly and efficiently. The General Manager controls and manages THA activities.

Members of the Authority Chairperson

Brett NewmanMBA, LLM, LLB, BEs

Chairperson since August 2013.

Appointed by the Secretary DFSI, Brett is the Deputy Secretary of the Property and Advisory Group, a group of DFSI related entities that includes: THA, Sydney Harbour Foreshore Authority, Waste Assets Management Corporation, Government Property NSW, NSW Public Works Facilities Management, Valuation Services (formerly part of Land and Property Information (LPI)) and Public Works Advisory.

Deputy Chairperson

Mark ByrneMM, MBA

Deputy Chairperson since January 2007.

Nominated by the Minister for Family and Community Services and appointed by the Governor, Mark is the Regional Asset Director, South Eastern Region, for the NSW Land and Housing Corporation.

Members

Katrina JayB Bus (Acc) Dip. Ed, CA

Member since January 2002.

Nominated by the Managing Director of TAFE NSW and appointed by the Governor, Katrina is the Manager, Strategic Planning at the Western Institute of TAFE.

Deborah (Deb) MartenBA, Dip Ed.

Member since January 2012.

Nominated by the Minister for Education and appointed by the Governor, Deb is an elected organiser, for the Riverina District and for the NSW Teachers Federation.

6

Mark AndersonBA. Dip Ed. M Ed.

Member from April 2015 to February 2016.

Appointed by the Secretary of the Department of Education Mark was the Director People and Careers at that Department until February 2016.

Kate SheehanBA. Dip Ed. M Ed.

Member since February 2016.

Appointed by the Secretary of the Department of Education Kate is the acting Director People and Careers at that Department.

Trish WebbDip Ed.

Member from August 2015 to February 2016.

Nominated by the Minister for Education and appointed by the Governor Trish was the Director Public Schools, Far West for the Department of Education.

Philip ShelleyB. Bus, Grad Dip Mgt, MBA

Member since June 2008.

Philip is the General Manager of the Teacher Housing Authority of NSW and Executive Member.

Authority MeetingsThe Authority met on four occasions during 2015–16 with attendances as follows:

NameEligible

to Attend Attended

Brett Newman 4 4

Mark Byrne 4 4

Mark Anderson/ Kate Sheehan1

4 3

Trish Webb2 2 2

Katrina Jay3 4 0

Deb Marten 4 4

Philip Shelley 4 4

1. On 4 May 2016 Claudia Ranieri attended as proxy for Kate Sheehan (this position is able to nominate a proxy).

2. Pending an appointment this position was vacant from Feb – June) (this position is unable to nominate a proxy).

3. Due to prolonged illness Katrina Jay was unable to attend meetings during the year (this position is unable to nominate a proxy).

Related EntityTHA is a non-controlled related entity of the Department of Finance, Services and Innovation (DFSI) and is grouped within Property NSW.

Property NSW is the new brand name encompassing the entities of Government Property NSW (GPNSW), Sydney Harbour Foreshore Authority (SHFA), Teacher Housing Authority of NSW (THA) and Waste Assets Management Corporation (WAMC).

This provides THA with corporate support including: business and administration systems; HR policies, including employee development programs; matters concerning audit, risk and governance; ministerial and executive services and legal counsel.

THA submits reports to Property NSW for inclusion in DFSI agency cluster reporting to support DFSI, the Secretary and the Minister with reporting to the Expenditure Review Committee (ERC) and Cabinet on behalf of all agencies for which the Minister is responsible for.

6

Mark AndersonBA. Dip Ed. M Ed.

Member from April 2015 to February 2016.

Appointed by the Secretary of the Department of Education Mark was the Director People and Careers at that Department until February 2016.

Kate SheehanBA. Dip Ed. M Ed.

Member since February 2016.

Appointed by the Secretary of the Department of Education Kate is the acting Director People and Careers at that Department.

Trish WebbDip Ed.

Member from August 2015 to February 2016.

Nominated by the Minister for Education and appointed by the Governor Trish was the Director Public Schools, Far West for the Department of Education.

Philip ShelleyB. Bus, Grad Dip Mgt, MBA

Member since June 2008.

Philip is the General Manager of the Teacher Housing Authority of NSW and Executive Member.

Authority MeetingsThe Authority met on four occasions during 2015–16 with attendances as follows:

NameEligible

to Attend Attended

Brett Newman 4 4

Mark Byrne 4 4

Mark Anderson/ Kate Sheehan1

4 3

Trish Webb2 2 2

Katrina Jay3 4 0

Deb Marten 4 4

Philip Shelley 4 4

1. On 4 May 2016 Claudia Ranieri attended as proxy for Kate Sheehan (this position is able to nominate a proxy).

2. Pending an appointment this position was vacant from Feb – June) (this position is unable to nominate a proxy).

3. Due to prolonged illness Katrina Jay was unable to attend meetings during the year (this position is unable to nominate a proxy).

Related EntityTHA is a non-controlled related entity of the Department of Finance, Services and Innovation (DFSI) and is grouped within Property NSW.

Property NSW is the new brand name encompassing the entities of Government Property NSW (GPNSW), Sydney Harbour Foreshore Authority (SHFA), Teacher Housing Authority of NSW (THA) and Waste Assets Management Corporation (WAMC).

This provides THA with corporate support including: business and administration systems; HR policies, including employee development programs; matters concerning audit, risk and governance; ministerial and executive services and legal counsel.

THA submits reports to Property NSW for inclusion in DFSI agency cluster reporting to support DFSI, the Secretary and the Minister with reporting to the Expenditure Review Committee (ERC) and Cabinet on behalf of all agencies for which the Minister is responsible for.

7


Tenancy Services ManagementHousing allocatedDuring the year 454 teachers and 90 non-teachers (private tenants) were allocated housing (newly signed leases).

This represents an annual tenant-turnover rate of 41% which is significantly higher than the industry norm. As such, it is difficult to compare and benchmark THA costs, including maintenance, against the broader industry and other government agencies that provide residential accommodation (refer Benchmarking page 12).

Of the residences allocated to teachers, 273 (60%) were allocated to teachers appointed to temporary teaching positions.

RentsProperties managed by THA are tenanted and administered under the Residential Tenancies Act 2010. Under the THA Act, the Treasurer determines the setting of rents for THA property and approves the THA charging a market rent for each leased property.

THA engaged Land and Property Information (LPI) to determine a market rent for each residence.

Revised market rents were effective 1 May 2016 and were applied in accordance with the Residential Tenancies Act 2010. Once applied the average increase was 2.13%, with 22.7% of residences experiencing an increase, 8.2% a decrease and 69.1% experienced no change.

Teachers who believe that an increase in rent is excessive or the rent does not reflect the rental market can appeal to the THA for review, or seek a hearing with the NSW Civil and Administrative Tribunal.

Rental Subsidies Rental subsidies are offered to teachers who teach in four (incentive) transfer-point, six transfer-point and eight transfer-point schools. These are schools the DE considers advantageous for the purpose of recruitment and retention to offer various benefits in addition to a teacher’s salary, so as to encourage teachers to teach in those schools.

THA administers the rental subsidy on behalf of DE and DE pays the rental subsidy to THA on behalf of those teachers.

DE does not provide a rental subsidy to NSW TAFE teachers or to casual teachers.

Local Housing RepresentativesWhen new to a rural or remote community, it can be a daunting time for a teacher, particularly early in their career. Support from a teacher, experienced in the local area and with knowledge of housing procedures, can be invaluable.

To provide this support THA oversees a network of Local Housing Representatives. These representatives are teachers who are elected by the local Teacher Association as the THA representative. They provide their time voluntarily and play an important role in communicating with THA, school principals and teachers who live in THA accommodation.

As well as being a point-of-contact for newly appointed teachers they advise THA on allocations (particularly in relation to proposed sharing arrangements) and keep abreast of particular teacher needs and demands. Local Housing Representatives liase with THA staff on policy matters and proposed capital programs.

Every three years THA hosts a conference for these representatives. The conference provides opportunity for: THA to say thank you to this group, to share ideas, for representatives to meet THA staff and generally review and discuss the service THA provides.

Managing AgentsTHA use local managing agents to provide an accessible and responsive local tenancy management service to tenants on behalf of THA.

Managing Agents receive a monthly management fee for each property they manage. Their role includes: holding keys, arranging maintenance, conducting property inspections and administration of lease agreements.

As at June 2016, THA had 70 individual managing agents. Five THA properties are administered without a managing agent; these are Bigga (1), Lord Howe Island (3) and Wambangalang (1).

8

Vacancy/Occupancy Rate Where a property is vacant due to a lack of teacher demand, THA (through its managing agents) lease that property to a private tenant.

The average occupancy rate for the year was 87.8% up from 85.0% in 2014–15. The teacher utilisation rate, a more accurate efficiency indicator, increased from 73.9% to 76.8%. Factors influencing the vacancy rate include:

• the difficulty in attracting teachers to schoolresidences, that are situated in isolatedcommunities – are not required by teaching staff– but may be in the future;

• declining student enrolments, in some communities(in line with a decline in population);

• a high tenant turnover rate (41%);

• a high vacancy rate during the summerholiday period;

• the number of residences that are held vacant forteachers (sometimes for lengthy periods), followingadvice from a school that an appointment to aschool in the locality is imminent; and

• the need to leave residences vacant pendingdisposal action.

Housing DemandTHA assesses and reviews outstanding demand at the end of April and November each year. This coincides with the beginning and end of the school year. As at 30 April 2016, there were 269 unsatisfied applications for accommodation:

a) 10 were recent applications that were beingprocessed at the time;

b) 17 applications were from teachers who werehoused in THA accommodation and applied so asto relocate to another THA residence in that town;

c) 152 applications were from teachers who residedin private accommodation. These teachers appliedfor accommodation as it is the means of obtaininga rental subsidy from the DE. Of these applications41% are for housing in Broken Hill. In such areasthe private rental is considered partly-adequateand THA supplements the market; and

d) 90 longer-term applications, these teachers are inprivate rental accommodation and have requestedthat their application remain active as they wouldlike to be considered for THA accommodationshould it become available. Of these:

i. 18 applications are from teachers appointed toschools which attract one or two transfer-points(these communities generally have an adequateprivate rental market ), as such THA does notintend to provide additional accommodation inthese communities; and

ii. six applications are from teachers appointed toschools that attract four-transfer points; thesecommunities generally have a partly-adequateprivate rental market;

iii. sixty-six applications are from teachersappointed to schools that attract four(incentive) transfer points, six and eighttransfer-points, these communities generallyhave a partly-adequate private rental marketand the teacher would like to relocate to THAaccommodation if it were to become available(40% of these are for housing in Broken Hill).

Throughout categories C and D are teachers who currently reside in THA accommodation in another community to the school where they are appointed. This group includes those who are in THA accommodation which may be inadequate for their family’s needs.

Due to the individual needs of each teacher, unsatisfied applications for accommodation are difficult to classify and contain a degree of subjectivity. Notwithstanding this, unsatisfied demand is one of a number of factors THA uses when determining new supply.

Field TripsTenancy Services Officers undertake up to two field trips each year to increase their knowledge of their property portfolio. Field trips play an integral role in developing and maintaining relationships with tenants, principals, managing agents, local housing representatives and other key stakeholders in communities where THA provides accommodation.

Welcome Kit – Tenant HandbookA welcome kit, designed to allow a tenant to keep all material relating to their accommodation in one place, is provided to all new teacher-tenants. The kit includes a Tenant Handbook that provides teachers with all the important and practical information about their tenancy. The handbook can also be viewed and downloaded from the THA website.

8

Vacancy/Occupancy Rate Where a property is vacant due to a lack of teacher demand, THA (through its managing agents) lease that property to a private tenant.

The average occupancy rate for the year was 87.8% up from 85.0% in 2014–15. The teacher utilisation rate, a more accurate efficiency indicator, increased from 73.9% to 76.8%. Factors influencing the vacancy rate include:

• the difficulty in attracting teachers to schoolresidences, that are situated in isolatedcommunities – are not required by teaching staff– but may be in the future;

• declining student enrolments, in some communities(in line with a decline in population);

• a high tenant turnover rate (41%);

• a high vacancy rate during the summerholiday period;

• the number of residences that are held vacant forteachers (sometimes for lengthy periods), followingadvice from a school that an appointment to aschool in the locality is imminent; and

• the need to leave residences vacant pendingdisposal action.

Housing DemandTHA assesses and reviews outstanding demand at the end of April and November each year. This coincides with the beginning and end of the school year. As at 30 April 2016, there were 269 unsatisfied applications for accommodation:

a) 10 were recent applications that were beingprocessed at the time;

b) 17 applications were from teachers who werehoused in THA accommodation and applied so asto relocate to another THA residence in that town;

c) 152 applications were from teachers who residedin private accommodation. These teachers appliedfor accommodation as it is the means of obtaininga rental subsidy from the DE. Of these applications41% are for housing in Broken Hill. In such areasthe private rental is considered partly-adequateand THA supplements the market; and

d) 90 longer-term applications, these teachers are inprivate rental accommodation and have requestedthat their application remain active as they wouldlike to be considered for THA accommodationshould it become available. Of these:

i. 18 applications are from teachers appointed toschools which attract one or two transfer-points(these communities generally have an adequateprivate rental market ), as such THA does notintend to provide additional accommodation inthese communities; and

ii. six applications are from teachers appointed toschools that attract four-transfer points; thesecommunities generally have a partly-adequateprivate rental market;

iii. sixty-six applications are from teachersappointed to schools that attract four(incentive) transfer points, six and eighttransfer-points, these communities generallyhave a partly-adequate private rental marketand the teacher would like to relocate to THAaccommodation if it were to become available(40% of these are for housing in Broken Hill).

Throughout categories C and D are teachers who currently reside in THA accommodation in another community to the school where they are appointed. This group includes those who are in THA accommodation which may be inadequate for their family’s needs.

Due to the individual needs of each teacher, unsatisfied applications for accommodation are difficult to classify and contain a degree of subjectivity. Notwithstanding this, unsatisfied demand is one of a number of factors THA uses when determining new supply.

Field TripsTenancy Services Officers undertake up to two field trips each year to increase their knowledge of their property portfolio. Field trips play an integral role in developing and maintaining relationships with tenants, principals, managing agents, local housing representatives and other key stakeholders in communities where THA provides accommodation.

Welcome Kit – Tenant HandbookA welcome kit, designed to allow a tenant to keep all material relating to their accommodation in one place, is provided to all new teacher-tenants. The kit includes a Tenant Handbook that provides teachers with all the important and practical information about their tenancy. The handbook can also be viewed and downloaded from the THA website.

9


Customer SatisfactionDuring the year the Net Promoter Score (NPS) was adopted as a new method of measuring customer satisfaction. This method, replaced the SERVQUAL method (used since 2009) for measuring customer satisfaction.

The NPS provides an index, ranging from −100 to +100 that measures the willingness of customers to recommend a product or service to others. It is used as a proxy for gauging overall customer satisfaction.

Conducted quarterly, a survey is emailed to those teachers who have moved into a THA residence in preceding quarter.

The survey takes five minutes to complete and the format is compatible with smart phones, tablets and PCs. One question drives the score: “Based on your experience with Teacher Housing how likely are you to recommend us to a colleague?” Teachers answer with a score between 1 and 10 (with 1, being extremely unlikely to recommend, and 10 being extremely likely to recommend.

Responses are segmented into: Detractors (1–6); Neutrals (7–8); and Promoters (9–10). Neutrals are excluded, and the overall score is determined by the percent of Promoters minus the percent of Detractors. As such the score will always be between –100 and +100.

The results from teachers new to THA accommodation since 1 January 2015 – 30 June 2016 are as follows.

Item Number Percentage

Surveys Sent 762

Responses received 358 47%

Margin of error (at 95% confidence interval) 3.9

Detractors (1–6) 60 17%

Passives (7–8) 99 28%

Promoters (9–10) 210 59%

Comments received 80

Overall Score (Promoters minus Detractors) 59-17= +42

Given the importance housing is to a teacher’s overall experience the results are generally pleasing.

The method also provides opportunity for teachers to comment on the service received. Actions from comments received include: improving response rates to emails/messages; and addressing outstanding maintenance requests with managing agents.

Asset ManagementAt 30 June 2016 THA’s portfolio had a written down book value of $ 163.9 million. The portfolio consisted of 1352 properties, including 107 managed residences that are owned by the Department of Education. A breakdown of the portfolio is included in the Key performance indicators on page 15.

THA provides accommodation in 207 communities, the average number of residences in each community is 6.5 with a more detailed breakdown in the table below:

Community PresenceNumber of

CommunitiesNumber of Properties

Percent of Portfolio

More than 50 properties 4 227 17%

Between 30–49 properties 5 185 14%





With a single property 80 80 6%

Grand Total 207 1352 100%

10

Strategic Asset Management Plan THA has a Strategic Asset Management Plan which identifies residences that are surplus to need, replaces those that are in poor locations or at the end of their economic lives and provides for new supply to meet a portion of any unmet demand.

The plan considers the adequacy of the private rental markets where THA provides accommodation and the level of incentive the Department of Education provides to schools so as to assist attracting and retaining teachers at those schools. The plan has two aspects:

• Rural Strategy: provides for teachers to choose to commute from a larger community to where they teach. In many instances teachers prefer a reasonable daily commute to living in an isolated community. This choice supports the Department of Education’s recruitment and retention strategies.

• Remote Strategy: provides accommodation where teachers have no choice but to live in the community in which they teach.

The strategic asset management plan underpins portfolio management and supports recommendations made to the Board.

Eco VillageDuring the year THA continued to partner with the University of Sydney in research comparing the biophysical performance and achieved satisfaction outcomes of the Eco Village in Broken Hill against the THA’s conventional residences in that town. Further information including the research findings is available on the THA website.

Flexible AccommodationMaximising asset utilisation and providing the right mix of houses/units is difficult given varying demand i.e. singles, couples and families.

To meet this challenge THA developed flexible accommodation, an innovative concept developed at the Eco Village. A single level duplex can be configured into either: two two-bedroom units or; one single-bedroom unit and one three-bedroom unit. The first of these was completed in Lake Cargelligo in 2015 and then in Coonamble and Brewarrina in early 2016.

John Marsi, THA Asset Manager, won the 2016 Secretary’s individual award for innovation for progress made in these designs. Capable of meeting the needs of families, couples and singles it provides opportunity to improve asset utilisation over the life of the asset.

Capital ProgramThe Capital Program is focused on providing accommodation in the more isolated regions of NSW, where the private rental market does not adequately meet the needs of teachers. The program is funded from a combination of operating income, proceeds from the sale of surplus assets, and the annual State Government contribution.

During the year THA completed the construction of twenty new residences (refer Appendix 1 on page 20). Projects are not considered work-in-progress until expenditure, beyond the acquisition of land, has been incurred.

Land Purchases During the year THA purchased one block of land in Finley at a cost of $63,087.

Asset DisposalDuring the year THA sold ten properties, deemed to be surplus to need, refer Appendix 3 on page 20.

THA retains the proceeds from the sale of surplus assets which support funding new supply.

No properties with a value greater than $5 million were disposed of during 2015–16.

No properties were disposed of where there was a business or family connection between the purchaser and the approving person.

An application for access to documents concerning details of properties disposed of during the reporting year may be made in accordance with the Government Information (Public Access) Act 2009.

Hazardous MaterialsWhen THA properties are leased in accordance with the NSW Residential Tenancies Act 2010 they are not defined as a teacher’s workplace under the under the NSW Work Health and Safety Act 2011.

When maintenance or refurbishment work is carried out on a THA property it becomes the temporary workplace of the contractor. THA has a Hazardous Materials Management Plan for undertaking maintenance or other works at THA properties. This plan meets THA’s obligations under the NSW Work Health and Safety Act 2011. The plan can be downloaded from the THA website.

10

Strategic Asset Management Plan THA has a Strategic Asset Management Plan which identifies residences that are surplus to need, replaces those that are in poor locations or at the end of their economic lives and provides for new supply to meet a portion of any unmet demand.

The plan considers the adequacy of the private rental markets where THA provides accommodation and the level of incentive the Department of Education provides to schools so as to assist attracting and retaining teachers at those schools. The plan has two aspects:

• Rural Strategy: provides for teachers to choose to commute from a larger community to where they teach. In many instances teachers prefer a reasonable daily commute to living in an isolated community. This choice supports the Department of Education’s recruitment and retention strategies.

• Remote Strategy: provides accommodation where teachers have no choice but to live in the community in which they teach.

The strategic asset management plan underpins portfolio management and supports recommendations made to the Board.

Eco VillageDuring the year THA continued to partner with the University of Sydney in research comparing the biophysical performance and achieved satisfaction outcomes of the Eco Village in Broken Hill against the THA’s conventional residences in that town. Further information including the research findings is available on the THA website.

Flexible AccommodationMaximising asset utilisation and providing the right mix of houses/units is difficult given varying demand i.e. singles, couples and families.

To meet this challenge THA developed flexible accommodation, an innovative concept developed at the Eco Village. A single level duplex can be configured into either: two two-bedroom units or; one single-bedroom unit and one three-bedroom unit. The first of these was completed in Lake Cargelligo in 2015 and then in Coonamble and Brewarrina in early 2016.

John Marsi, THA Asset Manager, won the 2016 Secretary’s individual award for innovation for progress made in these designs. Capable of meeting the needs of families, couples and singles it provides opportunity to improve asset utilisation over the life of the asset.

Capital ProgramThe Capital Program is focused on providing accommodation in the more isolated regions of NSW, where the private rental market does not adequately meet the needs of teachers. The program is funded from a combination of operating income, proceeds from the sale of surplus assets, and the annual State Government contribution.

During the year THA completed the construction of twenty new residences (refer Appendix 1 on page 20). Projects are not considered work-in-progress until expenditure, beyond the acquisition of land, has been incurred.

Land Purchases During the year THA purchased one block of land in Finley at a cost of $63,087.

Asset DisposalDuring the year THA sold ten properties, deemed to be surplus to need, refer Appendix 3 on page 20.

THA retains the proceeds from the sale of surplus assets which support funding new supply.

No properties with a value greater than $5 million were disposed of during 2015–16.

No properties were disposed of where there was a business or family connection between the purchaser and the approving person.

An application for access to documents concerning details of properties disposed of during the reporting year may be made in accordance with the Government Information (Public Access) Act 2009.

Hazardous MaterialsWhen THA properties are leased in accordance with the NSW Residential Tenancies Act 2010 they are not defined as a teacher’s workplace under the under the NSW Work Health and Safety Act 2011.

When maintenance or refurbishment work is carried out on a THA property it becomes the temporary workplace of the contractor. THA has a Hazardous Materials Management Plan for undertaking maintenance or other works at THA properties. This plan meets THA’s obligations under the NSW Work Health and Safety Act 2011. The plan can be downloaded from the THA website.

11


Heritage AssetsAs at 30 June 2016 there were eight residences owned and managed by THA considered to be of local and state heritage significance and listed on a local council’s Local Environment Plan (S170 Register). Four are DE owned school residences, managed by THA (Crookwell, Quambone, Narrandera and Burren Junction) and four are THA owned residences (Leeton, Dalgety, Merriwa and Gulgong).

MaintenanceTHA classifies maintenance as either refurbishment maintenance or responsive (contingency) maintenance which includes periodic and emergency maintenance.

• Refurbishment maintenance is conducted in line with a maintenance plan that has been approved by the Board and developed using condition based property assessments. Expenditure on refurbishment programs and major works in 2015–16 was $2.2 million and included the refurbishment of 50 residences.

• Responsive maintenance is, in most instances arranged by Managing Agents with expenditure approved by THA. Expenditure on responsive maintenance was $4.4 million.

During the year THA conducted financial analysis to determine future maintenance expenditure based upon: the portfolio projections of the strategic asset plan; historic expenditure on responsive maintenance; typical component lifecycle and current asset quality.

That analysis estimated that future expenditure would be within 5% of the amounts currently projected in the forward estimates and 10 year financial projections. As such, the current projections were deemed to be sufficient to maintain the portfolio in its current condition.

Project ManagementTHA outsources project management to suitably qualified project and construction managers that provide design, documentation and supervision services for capital and refurbishment projects.

School ResidencesTHA manages residences owned by the Department of Education. These properties are located on school grounds and due to various title arrangements cannot be vested or otherwise transferred to THA.

During the year, the THA returned the management of the following five school residences to the Department of Education: Duri, Cowra South, Spring Terrace, Girilambone, Cumnock and the THA accepted the return of the Tambar Springs school residence.

Financial ManagementFinancial PerformanceFunding for operational and capital activities is provided from rental and investment income, proceeds from sale of assets and an annual contribution from the State Government.

The 2015–16 result was a deficit of $2.5 million, which was in line with budget. Operating revenue totalled $17.3 million. This included rental income of $10.6 million, against a budgeted $10.9 million, and a contribution received from the State Government of $5.9 million.

Salaries and wages totalled $1.8 million against budgeted $2 million and against $1.5 million in 2014–15. The salaries and wages expense in 2014–15 was lower due to a transfer of the superannuation liability from THA to the state.

Operating expenses totalled $19.8 million against a budgeted $19.8 million.

The state government contribution is in line with NSW Treasury’s Commercial Policy Framework, in particular, the Social Program Policy which forms part of that framework.

Capital ProgramDuring the year capital expenditure totalled $4.7 million (budgeted $6.8 million) and proceeds from the sale of surplus assets totalled $1.7 million (budgeted $2.9 million).

Opportunities to capitalise major items of maintenance are limited as such expenditure is rarely reflected in the residence’s market value. Analysis indicates that had this capitalisation occurred operating result would reflect a break-even position.

Land Owned or Occupied The value of the land owned or occupied as at 30 June 2016 was:

2015–16 $’000

2014–15 $’000

2013–14 $’000

Vacant Land 1,064 964 477

Residences 26,448 30,436 25,164

Total land owned or occupied 27,512 31,400 25,641

Asset value is recoded as at 30 June 2016.

12

Account Payment PerformanceThroughout the year, THA paid on average 98.1% percent of its creditors (90% percent of small businesses) within 30 days of receipt of invoice. Timeframes may vary depending on contractual and other agreements.

Account payment performance is detailed on page 12.

Credit Card CertificationAs required by Treasury Policy paper TPP 05-1 Credit Card Use Best Practice Guide, I certify that corporate credit card use at the THA during 2015–16 has been in accordance with Premier’s Memoranda and Treasurer’s Directions.

Philip Shelley, General Manager, Teacher Housing Authority of NSW, 30 September 2016

Loan FacilityIn June 2016 THA fully repaid a loan from T-Corp. The loan was able to be paid off ahead of time because the THA has adequate forecast cash reserves saving interest payments in the long term.

BenchmarkingBenchmarking against comparable organisations, conducted in 2014–15 was expanded to include exposure to future maintenance expenditure. Projections were made in light of asset age, current condition and typical component lifecycle.

Maintenance expenditure during the year, and for future projections, remains below this established benchmark.

Key Performance IndicatorsTHA reviews KPI’s and benchmarks annually, so as to ensure they are aligned with THA’s strategic objectives.

KPI’s are tabled on page 15.

Operating ResultsKey Financial Statistics Four Year Trend

Key Financial Results2015–16

$’0002014–15

$’0002013–14

$’0002012–13

$’000


Revenue 17,333 16,914 17,213 17,345

Expenses 19,787 20,106 22,166 19,290

Total Operating Revenue (2,454) (3,192) (4,953) (1,945)

Included in Operating Results:

State Government Contribution 5,868 5,725 5,710 5,705

Grant from DEC 600 600 600 600

Borrowing Costs 302 135 108 236

Financial Position

Assets 170,147 171,207 152,079 159,313

Liabilities 1,478 2,608 4,291 7,052

Net Assets 168,669 168,599 147,788 152,261

Financial Analysis

Current Ratio 5.03:1 6.84:1 3.03:1 1.76:1

Total Debt to Total Assets 0.9% 1.5% 2.8% 4.4%

Total Assets to Equity 100.9% 101.5% 102.9% 104.6%

Return on Assets (1.44)% (2.09)% (2.50)% (2.30)%

12

Account Payment PerformanceThroughout the year, THA paid on average 98.1% percent of its creditors (90% percent of small businesses) within 30 days of receipt of invoice. Timeframes may vary depending on contractual and other agreements.

Account payment performance is detailed on page 12.

Credit Card CertificationAs required by Treasury Policy paper TPP 05-1 Credit Card Use Best Practice Guide, I certify that corporate credit card use at the THA during 2015–16 has been in accordance with Premier’s Memoranda and Treasurer’s Directions.

Philip Shelley, General Manager, Teacher Housing Authority of NSW, 30 September 2016

Loan FacilityIn June 2016 THA fully repaid a loan from T-Corp. The loan was able to be paid off ahead of time because the THA has adequate forecast cash reserves saving interest payments in the long term.

BenchmarkingBenchmarking against comparable organisations, conducted in 2014–15 was expanded to include exposure to future maintenance expenditure. Projections were made in light of asset age, current condition and typical component lifecycle.

Maintenance expenditure during the year, and for future projections, remains below this established benchmark.

Key Performance IndicatorsTHA reviews KPI’s and benchmarks annually, so as to ensure they are aligned with THA’s strategic objectives.

KPI’s are tabled on page 15.

Operating ResultsKey Financial Statistics Four Year Trend

Key Financial Results2015–16

$’0002014–15

$’0002013–14

$’0002012–13

$’000


Revenue 17,333 16,914 17,213 17,345

Expenses 19,787 20,106 22,166 19,290

Total Operating Revenue (2,454) (3,192) (4,953) (1,945)

Included in Operating Results:

State Government Contribution 5,868 5,725 5,710 5,705


Borrowing Costs 302 135 108 236

Financial Position

Assets 170,147 171,207 152,079 159,313

Liabilities 1,478 2,608 4,291 7,052

Net Assets 168,669 168,599 147,788 152,261

Financial Analysis

Current Ratio 5.03:1 6.84:1 3.03:1 1.76:1

Total Debt to Total Assets 0.9% 1.5% 2.8% 4.4%

Total Assets to Equity 100.9% 101.5% 102.9% 104.6%

Return on Assets (1.44)% (2.09)% (2.50)% (2.30)%

13


Performance against Budget

Management Operations2015–16

Actual $’0002015–16

Budget $’000

2015–16 Variance

$’0002016–17

Budget $’000

Revenue

Rental Income 10,551 10,908 (357) 10,746


Government Contribution 5,868 5,711 157 6,015

Investment and Other Income 314 145 169 200

Total Operating Revenue 17,333 17,364 (31) 17,561

Expenses

Property Maintenance 6,641 7,045 404 7,449

Property Rates 2,342 2,286 (56) 2,428

Borrowing Costs 302 113 (189) 120

Personnel Services Expenses 2,129 2,125 (4) 2,209

Other Administration Expenses 3,160 3,252 92 2,960

Loss/(Gain) on Asset Disposals (39) 132 171 437

Depreciation 5,252 4,869 (383) 5,499

Total Operating Expenses 19,787 19,822 35 21,102

Operating Surplus/(Deficit) (2,454) (2,458) 4 (3,541)

Capital Program2015–16

Actual $’0002015–16

Budget $’000

2015–16 Variance

$’0002016–17

Budget $’000

Receipts

Asset Disposal Proceeds 1,657 2,865 (1,208) 3,933

Total Capital Receipts 1,657 2,865 (1,208) 3,933

Payments

New Works 4,726 6,605 1,879 4,938

Other 5 250 245 0

Total Capital Payments 4,731 6,855 2,124 4,938

Net Cash Inflow/(Outflow) (3,074) (3,990) 916 (1,005)

14

Account Payment Performance

QuarterCurrent

$’000

Less than 30

days overdue

$’000

Between 30 and

60 days overdue

$’000

Between 60 and

90 days overdue

$’000

More than 90

days overdue

$’000

All Suppliers Sep–15 3,831 64 4 39 –

Dec–15 4,166 416 2 – –

Mar–16 3,641 31 – – –

Jun–16 3,303 381 2 – –

Small Business Suppliers Sep–15 13 1 – – –

Dec–15 11 – – – –

Mar–16 7 – – – –

Jun–16 7 – – – –

Measure Sep–15 Dec–15 Mar–16 Jun–16




97% 96% 99% 100%


$3,731 $4,389 $3,591 $2,771

Dollar amount of accounts paid on time $3,620 $3,971 $3,561 $2,771


97% 90% 99% 100%


0 0 0 0

Interest paid on overdue accounts 0 0 0 0


Number of accounts due for payment 24 20 20 23

Number of accounts paid on time 14 20 20 23


58% 100% 100% 100%


$14 $11 $7 $7

Dollar amount of accounts paid on time $13 $11 $7 $7


93% 100% 100% 100%


0 0 0 0


14

Account Payment Performance

QuarterCurrent

$’000

Less than 30

days overdue

$’000

Between 30 and

60 days overdue

$’000

Between 60 and

90 days overdue

$’000

More than 90

days overdue

$’000

All Suppliers Sep–15 3,831 64 4 39 –

Dec–15 4,166 416 2 – –

Mar–16 3,641 31 – – –

Jun–16 3,303 381 2 – –

Small Business Suppliers Sep–15 13 1 – – –

Dec–15 11 – – – –

Mar–16 7 – – – –

Jun–16 7 – – – –

Measure Sep–15 Dec–15 Mar–16 Jun–16




97% 96% 99% 100%


$3,731 $4,389 $3,591 $2,771

Dollar amount of accounts paid on time $3,620 $3,971 $3,561 $2,771


97% 90% 99% 100%


0 0 0 0



Number of accounts due for payment 24 20 20 23

Number of accounts paid on time 14 20 20 23


58% 100% 100% 100%


$14 $11 $7 $7

Dollar amount of accounts paid on time $13 $11 $7 $7


93% 100% 100% 100%


0 0 0 0


15


Key Performance Indicators

Property and Occupancy Data

2016 Target 2016 2015 2014 2013

Houses by Owner THA N/A 464 476 495 518

DEC N/A 107 111 132 165

Head Leased N/A 0 0 1 3

Furnished Units (incl Studio Units) N/A 754 726 729 729

Total Residences Under Management 1,283 1,325 1,313 1,357 1,415

Vacant Land THA owned 25 37 26 28

Crown Land 2 2 2 2

Total N/A 27 39 28 30

Work In Progress N/A 0 3 7 13

Total Properties 1,352 1,355 1,392 1,458

Average Occupancy throughout the year 89.4% 87.8% 85.0% 85.3% 85.7%

Average Occupancy throughout the year by tenant type

Teachers 79.1% 76.8% 73.9% 72.8% 72.6%

Non Teachers 10.3% 11.0% 11.1% 12.5% 13.1%

Vacant 10.6% 12.2% 15.0% 14.7% 14.3%

Allocations (New Tenants signed) Teachers N/A 454 411 437 462

Non Teachers

N/A 90 82 101 125

Total 544 493 538 587

Weekly Rental Amounts (applied from 1 May*)

2016 2015 2014 2013

Average $186.93 $183.04 $176.57 $172.78

Highest $415.00 $415.00 $415.00 $410.00

Lowest $65.00 $55.00 $55.00 $50.00

Median $180.00 $180.00 $170.00 $165.00

Change of average rent 2.13% 3.66% 2.74% 2.41%

16

Capital Delivery

Average capital project delivery period (for projects completed in the period)

Target 2016 2016* 2015 2014 2013 2012 2011

Weeks to appoint a project manager 8 13 4 5 7 6 8

Weeks to appoint a contractor once a project manager has been appointed

12 27 11 12 26 20 29

Construction period 32 26 34 27 56 38 30

Period of delivery since approval (weeks) 52 66 49 44 89 64 67

Residences constructed in period 16 16 6 18 15 18 13

*Note that contracts are now tendered and awarded following Board approval.

StakeholdersResponsibilities to stakeholder groups and how those responsibilities are addressed are shown in Appendix 11 on page 28.

Human ResourcesStaffing Arrangement The THA Act prohibits THA from engaging employees. The staff who perform functions for the THA are DFSI employees, employed under agreement between THA and DFSI, and engaged in accord with the Government Sector Employment Act 2013. Accordingly, DFSI personnel policies and practices apply to the THA staff.

Staffing NumbersA table showing the category of staff at THA, for the reporting year and the preceding three years, is shown at Appendix 4 on page 21.

Organisational StructureThe organisational chart, as at 30 June 2016, outlining THA’s organisational structure, reporting lines and functional responsibilities is shown in Appendix 7 on page 22.

Principal RolesOn behalf of the THA, and in accordance with the PSC Circulars: 2014–09; 2015–07; and 2016–05 executive reporting is included in the DFSI annual report.

Industrial RelationsThere were no industrial issues which affected the operations of THA during the year.

Equal Employment Opportunity The THA’s EEO Management Plan for 2015–16 focused on improving internal communications through whole of staff meetings and circulated material to all staff.

Statistical information relating to the EEO is shown at Appendix 5 on page 21. The relative stability of the THA’s workforce has provided little opportunity to improve representation and distribution of some EEO groups at the THA.

Multicultural Policies and Services ProgramTHA is committed to the principles of multiculturalism outlined in the Community Relations Commission and Principles of Multiculturalism Act 2000.

These principles are implemented through:

• merit-based recruitment practices; and

• work arrangements in the office which respect and accommodate cultural and religious differences wherever possible.

THA acknowledges that members of the NSW Government teaching service are representative of many different cultures throughout the state. The provision of housing to those teachers is made on the basis that differences can be accommodated in each property without the need to take special action to meet particular religious or cultural requirements.

16

Capital Delivery

Average capital project delivery period (for projects completed in the period)

Target 2016 2016* 2015 2014 2013 2012 2011

Weeks to appoint a project manager 8 13 4 5 7 6 8

Weeks to appoint a contractor once a project manager has been appointed

12 27 11 12 26 20 29

Construction period 32 26 34 27 56 38 30

Period of delivery since approval (weeks) 52 66 49 44 89 64 67

Residences constructed in period 16 16 6 18 15 18 13

*Note that contracts are now tendered and awarded following Board approval.

StakeholdersResponsibilities to stakeholder groups and how those responsibilities are addressed are shown in Appendix 11 on page 28.

Human ResourcesStaffing Arrangement The THA Act prohibits THA from engaging employees. The staff who perform functions for the THA are DFSI employees, employed under agreement between THA and DFSI, and engaged in accord with the Government Sector Employment Act 2013. Accordingly, DFSI personnel policies and practices apply to the THA staff.

Staffing NumbersA table showing the category of staff at THA, for the reporting year and the preceding three years, is shown at Appendix 4 on page 21.

Organisational StructureThe organisational chart, as at 30 June 2016, outlining THA’s organisational structure, reporting lines and functional responsibilities is shown in Appendix 7 on page 22.

Principal RolesOn behalf of the THA, and in accordance with the PSC Circulars: 2014–09; 2015–07; and 2016–05 executive reporting is included in the DFSI annual report.

Industrial RelationsThere were no industrial issues which affected the operations of THA during the year.

Equal Employment Opportunity The THA’s EEO Management Plan for 2015–16 focused on improving internal communications through whole of staff meetings and circulated material to all staff.

Statistical information relating to the EEO is shown at Appendix 5 on page 21. The relative stability of the THA’s workforce has provided little opportunity to improve representation and distribution of some EEO groups at the THA.

Multicultural Policies and Services ProgramTHA is committed to the principles of multiculturalism outlined in the Community Relations Commission and Principles of Multiculturalism Act 2000.

These principles are implemented through:

• merit-based recruitment practices; and

• work arrangements in the office which respect and accommodate cultural and religious differences wherever possible.

THA acknowledges that members of the NSW Government teaching service are representative of many different cultures throughout the state. The provision of housing to those teachers is made on the basis that differences can be accommodated in each property without the need to take special action to meet particular religious or cultural requirements.

17


As a related entity of DFSI, THA staff members have access to the DFSI Multicultural Policies and Services Program 2015–2016 including the DFS statement on multicultural planning and progress.

THA will continue to implement the principles by the means outlined above.

The Community Relations Commission has advised the THA of its compliance with the Principles of Multiculturalism Act 2000.

Workplace Health and Safety (WHS)As DFSI employees, THA has adopted the DFSI WHS policies and procedures for THA staff. A DFSI WHS committee includes both a THA employer and employee representatives.

During 2015–16 there were no reportable incidents, near-misses, or lost time due to injury concerning THA employees, including contractors, agency staff or volunteers.

DFSI reports on, in its annual report, WHS initiatives, a WHS Community of Practice and a summary of compensation claims. These include WHS matters relating to THA.

Employee Assistance ProgramAs DFSI employees THA staff have access to the DFSI provided Employee Assistance Program.

NSW Public Sector Workforce ProfileAs part of a Service Level Agreement for corporate services, DFSI completes and lodges the annual workforce profile in respect of THA staff.

Disability Inclusion PlanThe THA has developed a Disability Inclusion Action Plan in accordance with the Guidelines for Disability Action Planning by NSW Government Agencies (Premier’s Memorandum M2009-01).

Other ActivitiesPublic Access to Government InformationDuring the year THA did not receive any requests for information under the Government Information Public Access Act (GIPAA) 2009.

Privacy and Personal Information Protection Act 1998 (PPIP Act)In accordance with section 33(1) of the Privacy and Personal Information Protection (PPIP) Act 1998 THA has adopted DFSI’s privacy management plan.

Information about how the THA manages its obligations under the PPIP Act is available at https://www.finance.nsw.gov.au/privacy-statement.

In 2015–16, THA did not receive: any applications by any individuals requesting their personal information under the PPIP Act; any informal requests for personal information; or any requests for reviews under the PPIP Act.

InsuranceNSW Treasury Managed Fund provides: workers compensation, property, public liability and miscellaneous cover for THA.

For the 2015–16 financial year, THA incurred insurance premiums totalling $376,497 (property cover was $350,086).

Property insurance related claims totalling $25,792 were paid by the fund during the year. Refer Appendix 6 on page 21.

Government Property RegisterLand titles held by THA are aligned to the Government Property Register (GPR) in accordance with Premiers Memorandum M2012-20.

18

Internal Audit and Risk Management THA has in place internal audit and risk management processes that are compliant with the eight core requirements set out in NSW Treasury Policy TTP 15-03 Internal Audit and Risk Management Policy for the NSW Public Sector. These processes include:

• THA Members approving the appointment of DFSI’s Chief Auditor Executive as THA’s Chief Auditor Executive;

• Treasury approving in accordance with Guidance on shared arrangements and sub committees for Audit and Risk Committees (TPP 12-04); shared arrangements for the entities that form Property NSW.

Refer internal Audit and Risk Management Attestation Statement (Appendix 8, page 23).

Internal Audit PlanTHA has an ongoing Internal Audit Program approved by the ARC. That program includes THA activities in DFSI wide audits as well as audits specific to THA. In 2015–16 the following audit, specific to THA, was conducted:

• Tenancy Allocation.

Public Interest Disclosures (PID’s)THA adopts the DFSI Fraud and Corruption Internal Reporting Policy. That policy outlines the support and protections available for staff under the Public Interest Disclosures Act 1994 for a person wishing to make a public interest disclosure.

The policy is available on the intranet, it includes details of nominated officers who are authorised to receive a disclosure (including the THA General Manager).

PID resources are available to staff on the intranet, highlighted during induction training and presented on at staff meetings with the presentations emailed to staff.

During the year there were no PIDs made: by public officials performing their day to day functions; under a statutory or other legal obligation; or of any other form.

ConsultantsNine consultants were engaged during the year at a total cost of $64,300. Consultancies supported and/or provided advice in regard to the following:

• review and consider the maintenance service delivery model;

• conduct long-term maintenance expenditure scenario analysis;

• taxation advice (GST);

• evaluate position descriptions;

• assess (audit) website security;

• assess the adequacy of 13 private rental markets;

• examine the payment process (justification) of a specific capital project;

• research the history of a heritage residence, and

• provide illustrative plans for a design concept.

Information and Communications Technology Under a Service Level Agreement DFSI supports the THA’s ICT systems. This includes web hosting, configuration, administration, management and maintenance related support functions for servers within the production and DR data centres and remote office data centres.

THA’s website, at www.tha.nsw.gov.au provides teachers with access to a range of information and online services including application and vacancy forms, tenant handbooks, policies and reports, newsletters and contact information. Teachers can view properties in each location.

During the year THA replaced the financial aspects of ProMan (IT operating platform) with SAPbyDesign. This project, which leveraged off a similar successfully implemented project at Sydney Harbour Foreshore Authority was managed and delivered by Government Property NSW.

The financial aspects of SAPbyDesign went live on 1 July 2016. THA remains reliant upon ProMan for non-financial tenancy and asset management functions until customised modifications to SAPbyDesign have been fully implemented.

18

Internal Audit and Risk Management THA has in place internal audit and risk management processes that are compliant with the eight core requirements set out in NSW Treasury Policy TTP 15-03 Internal Audit and Risk Management Policy for the NSW Public Sector. These processes include:

• THA Members approving the appointment of DFSI’s Chief Auditor Executive as THA’s Chief Auditor Executive;

• Treasury approving in accordance with Guidance on shared arrangements and sub committees for Audit and Risk Committees (TPP 12-04); shared arrangements for the entities that form Property NSW.

Refer internal Audit and Risk Management Attestation Statement (Appendix 8, page 23).

Internal Audit PlanTHA has an ongoing Internal Audit Program approved by the ARC. That program includes THA activities in DFSI wide audits as well as audits specific to THA. In 2015–16 the following audit, specific to THA, was conducted:

• Tenancy Allocation.

Public Interest Disclosures (PID’s)THA adopts the DFSI Fraud and Corruption Internal Reporting Policy. That policy outlines the support and protections available for staff under the Public Interest Disclosures Act 1994 for a person wishing to make a public interest disclosure.

The policy is available on the intranet, it includes details of nominated officers who are authorised to receive a disclosure (including the THA General Manager).

PID resources are available to staff on the intranet, highlighted during induction training and presented on at staff meetings with the presentations emailed to staff.

During the year there were no PIDs made: by public officials performing their day to day functions; under a statutory or other legal obligation; or of any other form.

ConsultantsNine consultants were engaged during the year at a total cost of $64,300. Consultancies supported and/or provided advice in regard to the following:

• review and consider the maintenance service delivery model;

• conduct long-term maintenance expenditure scenario analysis;

• taxation advice (GST);

• evaluate position descriptions;

• assess (audit) website security;

• assess the adequacy of 13 private rental markets;

• examine the payment process (justification) of a specific capital project;

• research the history of a heritage residence, and

• provide illustrative plans for a design concept.

Information and Communications Technology Under a Service Level Agreement DFSI supports the THA’s ICT systems. This includes web hosting, configuration, administration, management and maintenance related support functions for servers within the production and DR data centres and remote office data centres.

THA’s website, at www.tha.nsw.gov.au provides teachers with access to a range of information and online services including application and vacancy forms, tenant handbooks, policies and reports, newsletters and contact information. Teachers can view properties in each location.

During the year THA replaced the financial aspects of ProMan (IT operating platform) with SAPbyDesign. This project, which leveraged off a similar successfully implemented project at Sydney Harbour Foreshore Authority was managed and delivered by Government Property NSW.

The financial aspects of SAPbyDesign went live on 1 July 2016. THA remains reliant upon ProMan for non-financial tenancy and asset management functions until customised modifications to SAPbyDesign have been fully implemented.

19


NSW Digital Information Security Policy Compliance Attestation Statement 2015–16 Financial Year Teacher Housing Digital Information Security Annual Attestation Statement (Appendix 9).

Business Continuity Plan (BCP)THA’s ICT platforms are integrated within the DFSI IT infrastructure. THA therefore subscribes to and is part of the broader DFSI plan on disaster recovery and crisis management.

THA has prepared a Business Impact Assessment in conjunction with the DFSI business continuity management team which addresses specific THA requirements in the event of a crisis.

Business Plan/Statement of Business IntentTHA prepares an annual Statement of Business Intent (SBI) and a Business Plan in accordance with NSW Treasury Guideline Reporting and Monitoring Policy for Government Businesses (TPP05-02).

The SBI is a performance agreement between THA, the Minister and the Treasurer and outlines THA’s strategic and performance commitments for the 2016–17 financial year. The Business Plan supports the SBI and details the objectives, strategies and performance targets of the organisation within a five to 10 year planning horizon.

The SBI and the Business Plan were endorsed by the Board in September 2016 and forwarded to the Secretary of the Treasury (on behalf of the Treasurer) for endorsement. Once endorsed, the SBI will be available on THA’s website.

Property NSW submits the 2016–17 SBI and Business Plan on behalf of THA.

Overseas TravelNo Board or staff member travelled overseas on official business during 2015–16.

Review of Government Employee AccommodationWith a core competency of providing employee accommodation in rural and remote NSW, THA continues to provide logistical and commercial advice on aspects of government employee accommodation to other Government agencies as requested.

Public Sector Reforms and Legislative ChangesDuring the year, there were no administrative or legislative changes which impacted THA’s governance, strategic direction or financial position.

20

AppendicesAppendix 1Residences Constructed or Acquired During 2015–16

Town Project Description StreetTotal project Cost ($’000)

Lake Cargelligo Construction of two unit duplex (flexible design) Grace Street 542.3

Naranderra Construction of two single-bedroom units Jellinbah Street 621.7

Condobolin Driveway modifications to units purchased in 2013-14 McGreggor Street

69.2

Coonamble Construction of two two-unit duplex (flexible design) Bimble Street 1,168.5

Wilcannia Construction of four single-bedroom units Woore Street 1,054.9

Brewarrina Construction of four single-bedroom units Wilson Street 1,149.8

Brewarrina Construction of two two-unit duplex (flexible design) Bathurst Street 1,188.9

Total 5,795.3

Appendix 2Works-In-Progress as at 30 June 2016

Town Project Description Street Cost ($’000)

Leeton Legal fee for land acquisition Church Street 1.5

Condobolin Survey plans and preliminary drawings Officers Parade 25.3

Total 26.8

Appendix 3Asset Disposal (Property Sold in 2015–2016)

Town Address Type Contract Price

Cowra 4 Karinya Street House 180,000

Hanwood 20 Wilga Street House 190,000

Dundurrabin 37 Mount Street House 132,500

Griffith 26 Wyangan Avenue House 185,000

Griffith 5 Bennett Court House 195,000

Corindi Beach 121A Pacific Street House 315,000

Ungarie 28 Ungarie Street House 110,000

Gunnedah 121 Barber Street House 79,950

Walcha 4 Semphill Crescent 2 Units 342,000

Total 1,729,450

20

AppendicesAppendix 1Residences Constructed or Acquired During 2015–16

Town Project Description StreetTotal project Cost ($’000)

Lake Cargelligo Construction of two unit duplex (flexible design) Grace Street 542.3

Naranderra Construction of two single-bedroom units Jellinbah Street 621.7

Condobolin Driveway modifications to units purchased in 2013-14 McGreggor Street

69.2

Coonamble Construction of two two-unit duplex (flexible design) Bimble Street 1,168.5

Wilcannia Construction of four single-bedroom units Woore Street 1,054.9

Brewarrina Construction of four single-bedroom units Wilson Street 1,149.8

Brewarrina Construction of two two-unit duplex (flexible design) Bathurst Street 1,188.9

Total 5,795.3

Appendix 2Works-In-Progress as at 30 June 2016

Town Project Description Street Cost ($’000)

Leeton Legal fee for land acquisition Church Street 1.5

Condobolin Survey plans and preliminary drawings Officers Parade 25.3

Total 26.8

Appendix 3Asset Disposal (Property Sold in 2015–2016)

Town Address Type Contract Price

Cowra 4 Karinya Street House 180,000

Hanwood 20 Wilga Street House 190,000

Dundurrabin 37 Mount Street House 132,500

Griffith 26 Wyangan Avenue House 185,000

Griffith 5 Bennett Court House 195,000

Corindi Beach 121A Pacific Street House 315,000

Ungarie 28 Ungarie Street House 110,000

Gunnedah 121 Barber Street House 79,950

Walcha 4 Semphill Crescent 2 Units 342,000

Total 1,729,450

21


Appendix 4THA Employees by Category as at 30 June 2016

Category 2015–16 2014–15 2013–14 2012–13

Administrative and clerical and part time employees (includes contractors)

Full-time positions 19 20 21 21

Part-time positions 3 3 3 2

Total Positions 22 23 24 23

Appendix 5Workforce Diversity

Workplace Diversity Group Govt Target 2015–16 2014–15 2013–14 2012-13

Women 50% 73% 73% 59% 59%

Aboriginal & Torres Strait Islanders 2% – – – –

People whose language first spoken as a child was not English

20% 50% 48% 30% 30%

People with Disability 12% – – – –

Appendix 6Treasury Managed Fund – Insurance Recovery

Locality Claim Cost ($)

Wambangalang Pipes burst in ceiling 6,094

Bourke Storm damage 2,768

Mendooran Storm damage 2,628

Lightning Ridge Replace garage door – vehicle damage 2,228

Bourke Replace vanity – water damage 1,245

Bourke Ceiling damage water leak 1,232

North Star Storm damage 1,199

Condobolin Repairs to storeroom – break in 1,133

Wanaaring Storm damage 1,078

Various 11 Claims under $1000 6,188

Total 25,792

22

Appendix 7Operational Management Chart 2015–16

Technical Officer

Technical Officer

Contracts Admin Officer

General Manager

THA BoardProperty NSW (DFSI Group of

Agencies)

Department of Finance, Services

and Innovation

Tenancy Services ManagerAsset Manager

Financial Accountant

Business Analyst (Part-time)

Executive Assistant

Executive Officer

Project Officer Communications

(Part-time)

Finance Manager

Finance Officer Accounts Payable

Finance Officer Accounts

Receivable

Maintenance Officer

Tenancy Services Officer

Admin Assistant




Tenancy Support Officer (Part-time)

Finance Officer Debt Recovery

22

Appendix 7Operational Management Chart 2015–16

Technical Officer

Technical Officer

Contracts Admin Officer

General Manager

THA BoardProperty NSW (DFSI Group of

Agencies)

Department of Finance, Services

and Innovation

Tenancy Services ManagerAsset Manager

Financial Accountant

Business Analyst (Part-time)

Executive Assistant

Executive Officer

Project Officer Communications

(Part-time)

Finance Manager

Finance Officer Accounts Payable

Finance Officer Accounts

Receivable

Maintenance Officer


Admin Assistant




Tenancy Support Officer (Part-time)

Finance Officer Debt Recovery

23


Appendix 8Internal Audit and Risk Management Attestation Statement for the 2015–2016 Financial Year for the Teacher Housing AuthorityI, Brett Newman, Chair of the Teacher Housing Authority, am of the opinion that the Teacher Housing Authority has internal audit and risk management processes in operation that are compliant with the eight (8) core requirements set out in the Internal Audit and Risk Management Policy for the NSW Public Sector, specifically:

Core Requirements

For each requirement, please specify whether compliant, non-compliant, or in transition

Risk Management Framework

1.1 The agency head is ultimately responsible and accountable for risk management in the agency

Compliant

1.2 A risk management framework that is appropriate to the agency has been established and maintained and the framework is consistent with AS/NZS ISO 31000:2009

Compliant

Internal Audit Function

2.1 An internal audit function has been established and maintained Compliant

2.2 The operation of the internal audit function is consistent with the International Standards for the Professional Practice of Internal Auditing

Compliant

2.3 The agency has an Internal Audit Charter that is consistent with the content of the ‘model charter’

Compliant

Audit and Risk Committee

3.1 An independent Audit and Risk Committee with appropriate expertise has been established

Compliant

3.2 The Audit and Risk Committee is an advisory committee providing assistance to the agency head on the agency’s governance processes, risk management and control frameworks, and its external accountability obligations

Compliant

3.3 The Audit and Risk Committee has a Charter that is consistent with the content of the ‘model charter’

Compliant

24

MembershipThe chair and members of the Audit and Risk Committee are:

• Carol Holley, Independent Chair, from 2 December 2016 to 1 December 2020;

• Dianne Hill, Independent Member, from 1 February 2016 to 31 January 2019;

• Mark O’Sullivan, Independent Member, from 25 January 2016 to 24 January 2018.

The previous Audit and Risk Committee was disbanded with effect from 20 November 2015.

This Audit and Risk Committee has been established under a Treasury approved shared arrangement with the following departments/statutory bodies:

• Government Property NSW

• Sydney Harbour Foreshore Authority

• Luna Park Reserve Trust

• Waste Assets Management Corporation

Brett Newman Chair Teacher Housing Authority

Date: 22 September 2016

Agency Contact Officer Andrew Pilbeam Chief Audit Executive, 9372 8047 [email protected]

24

MembershipThe chair and members of the Audit and Risk Committee are:

• Carol Holley, Independent Chair, from 2 December 2016 to 1 December 2020;

• Dianne Hill, Independent Member, from 1 February 2016 to 31 January 2019;

• Mark O’Sullivan, Independent Member, from 25 January 2016 to 24 January 2018.

The previous Audit and Risk Committee was disbanded with effect from 20 November 2015.

This Audit and Risk Committee has been established under a Treasury approved shared arrangement with the following departments/statutory bodies:

• Government Property NSW

• Sydney Harbour Foreshore Authority

• Luna Park Reserve Trust

• Waste Assets Management Corporation

Brett Newman Chair Teacher Housing Authority


Agency Contact Officer Andrew Pilbeam Chief Audit Executive, 9372 8047 [email protected]

25


Appendix 9Digital Information Security Annual Attestation Statement for 2015–2016I, Philip Shelley, General Manager of the Teacher Housing Authority of NSW, am of the opinion that the Teacher Housing Authority has implemented an Information Security Management System during the financial year being reported on which is compliant with the Core Requirements set out in the Digital Information Security Policy for the NSW Public Sector.

I, Philip Shelley, General Manager of the Teacher Housing Authority of NSW, am of the opinion that the security controls in place, to mitigate identified risks to the digital information and digital information systems of the Teacher Housing Authority are adequate for the foreseeable future.

I, Philip Shelley, General Manager of the Teacher Housing Authority of NSW, am of the opinion that, where necessary in accordance with the Digital Information Security Policy for the NSW Public Sector, the Teacher Housing Authority of NSW is transitioning towards adopting relevant practices aligned with AS/NZS ISO/IEC 27001 Information technology – Security techniques – Information security management systems.

Philip Shelley General Manager


26

Appendix 10Comments from customer survey

All in all it has been an extremely easy and positive experience. Next to previous housing procedure I cannot fault the ease and understanding shown in the move. Absolutely nothing negative to report! Thank you

I liked dealing with Nick. I thought he was accurate when giving information and friendly with his customer service. Unfortunately, I moved all the way from Newcastle to Broken Hill on a single term contract. There’s so much rhetoric on attracting and keeping good teachers in the bush, but nothing was done to help me maintain my accommodation here or move to a new place.

Only that at the beginning when I was looking to move in, it took longer than originally planned but I was only notified when I contacted you. I would have appreciated being kept in the loop.

I was in a time of uncertainty while moving from Sydney where I lived with my husband to Moree where I would be living alone. Teacher Housing were wonderful to work with and all I had to organise was my electricity and phone connection. Thank you once again!

Thankyou. Trish Clark from Trangie and Elodie from Cobar have been excellent.

Staff at THA and staff at local agency have been terrific!

The whole experience was very smooth, aided enormously by friendly, helpful, efficient people. Thank you!

Kerrie from THA is fantastic and Kelly’s Property in Walgett are very responsive to requests

I appreciated being able to defer full payment of the bond to reduce moving costs. I arrived in Broken Hill and the apartment was ready. I was so grateful, thank you very much

As a Teacher that has moved from a country town to another country town it has been great for me knowing that there is a property available at times through Teacher Housing. It takes much of the stress away of trying to look for and viewing dozens of units, homes etc. As the elected Teacher Housing Representative for our Association I will endeavour to speak with all teachers in the town that are being housed by TH so that they can contact me with concerns about their rental properties. It will also give me the opportunity to speak with THA on a regular basis so that we are able to make the transition of these teachers who have taken the step and moved to a country town a lot more stress free when it comes to dealing with such issues as out-dated furniture, stoves, repairs etc. It is great that units and homes can be partly furnished, but when these materials are old and parts are not available to be repaired then up-grades should be made accordingly. It is here that TH and the agent, tenant will be working as one to attract more and more teachers to the country area with a great service from TH. Thanking you for the opportunity to participate in the survey and looking forward to dealing with you in the future.

26

Appendix 10Comments from customer survey

All in all it has been an extremely easy and positive experience. Next to previous housing procedure I cannot fault the ease and understanding shown in the move. Absolutely nothing negative to report! Thank you

I liked dealing with Nick. I thought he was accurate when giving information and friendly with his customer service. Unfortunately, I moved all the way from Newcastle to Broken Hill on a single term contract. There’s so much rhetoric on attracting and keeping good teachers in the bush, but nothing was done to help me maintain my accommodation here or move to a new place.

Only that at the beginning when I was looking to move in, it took longer than originally planned but I was only notified when I contacted you. I would have appreciated being kept in the loop.

I was in a time of uncertainty while moving from Sydney where I lived with my husband to Moree where I would be living alone. Teacher Housing were wonderful to work with and all I had to organise was my electricity and phone connection. Thank you once again!

Thankyou. Trish Clark from Trangie and Elodie from Cobar have been excellent.

Staff at THA and staff at local agency have been terrific!

The whole experience was very smooth, aided enormously by friendly, helpful, efficient people. Thank you!

Kerrie from THA is fantastic and Kelly’s Property in Walgett are very responsive to requests

I appreciated being able to defer full payment of the bond to reduce moving costs. I arrived in Broken Hill and the apartment was ready. I was so grateful, thank you very much

As a Teacher that has moved from a country town to another country town it has been great for me knowing that there is a property available at times through Teacher Housing. It takes much of the stress away of trying to look for and viewing dozens of units, homes etc. As the elected Teacher Housing Representative for our Association I will endeavour to speak with all teachers in the town that are being housed by TH so that they can contact me with concerns about their rental properties. It will also give me the opportunity to speak with THA on a regular basis so that we are able to make the transition of these teachers who have taken the step and moved to a country town a lot more stress free when it comes to dealing with such issues as out-dated furniture, stoves, repairs etc. It is great that units and homes can be partly furnished, but when these materials are old and parts are not available to be repaired then up-grades should be made accordingly. It is here that TH and the agent, tenant will be working as one to attract more and more teachers to the country area with a great service from TH. Thanking you for the opportunity to participate in the survey and looking forward to dealing with you in the future.

27


Biki’s help and advice was very calming, as I was panicking about when housing would be available.

Disappointed with agent’s inspection of property – many faults not recognised at all, including the cleaning (or lack there of), old appliances, bent legs on chairs and stain in bath. All interactions with Teacher Housing have been positive and prompt with every effort to fit in with my movements. thank you and well done

Great place to call home.

It is so wonderful to be able to make a big life change with the support of housing behind myself and my family. It has been one of the best things my family has ever done and Nic Ul and the team around him have been instrumental in making this happen. Thank you.

Teacher housing is very practical and the standard has always been good.

I have been moved in for a term and I am still waiting on a new couch and a dead tree to be taken out of the backyard

We have only been in teacher housing for one term. To date we have no complaints.

Talking to nice personable people... I didn’t feel I was just a number

Any issues have been more with the managing agent than with THA.

All seemed to go ok, just little hickup with rent deductions when payroll mucked up pay so I got 3 pays and therefore 3 lots of rent deducted in 2 weeks. Just waiting on bond to be refunded.

An excellent experience thanks to Karen as well as the agents up here. The house we were privately renting up here was going to be sold so we wanted to get the family settled in somewhere new before Christmas, at fairly short notice. This was achieved and made easy after my initial contact with teacher housing. This is my first experience in dealing with the organisation and I thoroughly recommend the service. Thanks again

Very happy with my house. From point of contact to moving in was a few days. My alternative was a motel so i really appreciate my situation being treated with the efficiency that it was, by teacher housing and the real estate agent.

28

Appendix 11Responsibilities to stakeholders

Responsibility Stakeholder Application

1. The provision of an economic, effective and efficient housing service where the private rental market is inadequate.

Members of the Education Teaching Service (Teachers)

• Review business performance, where necessary measuring it against relevant indicators. Prepare adequate business plans; budgets, audits and customer surveys.

• Determine alternative rental accommodation in the relevant communities.

• Ensure managing agents are accessible, responsive, and suitably empowered to act on behalf of THA.

• Support locally appointed housing representatives to represent and liaise with tenants, agents and THA.

• Prepare and review a strategic asset plan for the portfolio to ensure service levels and business objectives are met and assets are acquired, maintained and sold as required.

2. Significant matters relating to the housing of teacher and non-teacher tenants are referred for consideration.


• Submission of the Business Plan and Statement of Business Intent.

3. Contentiousness or politically sensitive issues that may impact upon the government are advised in a timely manner.

3.i. Deadlines set for the provision of briefing notes, draft responses to ministerial correspondences are met.


• Ensure THA has a robust policy framework in place so as issues are suitably addresses as they arise.

• Be aware of Property NSW / DFSI policies and objectives so as such issues are appropriately advised and/or responded to.

4. Support the Department of Education in the delivery of education by providing quality housing as an incentive to attract and retain teachers to localities in rural NSW.

Department of Education

• Ensure THA liaises with the Department of Education staffing services on accommodation needs, local issues, emerging demographics and other relevant topics.

• Conduct customer surveys on the adequacy of the THA’s service.

5. Liaise with the Department of Education on THA policy matters that may impact on the ability of the department to adequately staff schools and TAFE colleges in rural NSW.


• The preparation and review of business plans, budgets, forward estimates underpinned by adequate strategic asset plans.

6. The development and implication of a financially sound Business Plan and Statement of Business Intent.

NSW Treasury • Review the Business Plan and Statement of Business Intent in light of THA’s objectives, scope of operations, strategic direction, financial & non-financial targets and impacts of risk assessments.

28

Appendix 11Responsibilities to stakeholders


1. The provision of an economic, effective and efficient housing service where the private rental market is inadequate.

Members of the Education Teaching Service (Teachers)

• Review business performance, where necessary measuring it against relevant indicators. Prepare adequate business plans; budgets, audits and customer surveys.

• Determine alternative rental accommodation in the relevant communities.

• Ensure managing agents are accessible, responsive, and suitably empowered to act on behalf of THA.

• Support locally appointed housing representatives to represent and liaise with tenants, agents and THA.

• Prepare and review a strategic asset plan for the portfolio to ensure service levels and business objectives are met and assets are acquired, maintained and sold as required.

2. Significant matters relating to the housing of teacher and non-teacher tenants are referred for consideration.


• Submission of the Business Plan and Statement of Business Intent.


3.i. Deadlines set for the provision of briefing notes, draft responses to ministerial correspondences are met.


• Ensure THA has a robust policy framework in place so as issues are suitably addresses as they arise.

• Be aware of Property NSW / DFSI policies and objectives so as such issues are appropriately advised and/or responded to.

4. Support the Department of Education in the delivery of education by providing quality housing as an incentive to attract and retain teachers to localities in rural NSW.


• Ensure THA liaises with the Department of Education staffing services on accommodation needs, local issues, emerging demographics and other relevant topics.

• Conduct customer surveys on the adequacy of the THA’s service.

5. Liaise with the Department of Education on THA policy matters that may impact on the ability of the department to adequately staff schools and TAFE colleges in rural NSW.


• The preparation and review of business plans, budgets, forward estimates underpinned by adequate strategic asset plans.

6. The development and implication of a financially sound Business Plan and Statement of Business Intent.

NSW Treasury • Review the Business Plan and Statement of Business Intent in light of THA’s objectives, scope of operations, strategic direction, financial & non-financial targets and impacts of risk assessments.

29



7. Adherence to all financial policies and procedures required of government.

NSW Treasury


• Preparation and presentation of annual audited financial statements.

• Preparation and presentation of a Business Plan and Statement of Business Intent.

• Liaison on various preliminary and mini budgets.

• Respond to requests for information in a timely manner.

• Adherence to Acts, Regulations, circulars, policies and guidelines.

• Preparation and presentation of the annual report.


8.i. Deadlines set for the provision of briefing notes, draft responses to ministerial correspondences etc. are met.

8.ii. Operate within the broad governmental framework of NSW.


Department of Premier and Cabinet


Public Service Commission

• Adhere to all policies and procedures required of governmental agencies.

• Respond to requests for information in a timely manner.

• Review the impact of governmental policy on THA’s business.

• Preparation and submission of THA’s annual report.

9. Provide an organisation that engenders a learning and continuous improvement culture.

THA Staff • Review operational and strategic HR issues in light of legislative issues and the boarder governmental framework.

• Review the business plan in consideration of internal capabilities in an effort to align an employee’s needs with those of THA.

10. THA be appropriately resourced to deliver an effective and efficient housing service to teachers.

THA Staff • Ensure THA’s objectives are met by preparing an appropriate budget, training employees and recruiting staff adequately qualified for each position.

11. Access to quality education for all NSW children.

Students and parents

• The provision of quality housing service to teachers in rural and remote NSW where the private rental market does not meet their needs.

12. The rights of the members of the community who rent THA accommodation (in the absence of teacher demand).

The wider community

• Compliance with various legislations in particular the NSW residential tenancy legislation.

30

Financial StatementsFor the Year Ended 30 June 2016Statement by Members 31

Independent Auditor’s Report 32

Statement of Comprehensive Income 34

Statement of Financial Position 35

Statement of Changes in Equity 36

Statement of Cash Flows 37

Notes Accompanying and Forming Part of the Financial Statements 38

30

Financial StatementsFor the Year Ended 30 June 2016Statement by Members 31

Independent Auditor’s Report 32

Statement of Comprehensive Income 34

Statement of Financial Position 35

Statement of Changes in Equity 36

Statement of Cash Flows 37

Notes Accompanying and Forming Part of the Financial Statements 38

31


Statement by MembersFinancial Statements for the Period Ended 30 June 2016

Pursuant to Section 41C (1B) and 1(C) of the Public Finance and Audit Act 1983, I declare on behalf of the Teacher Housing Authority of New South Wales that in my opinion:

(a) The accompanying financial statements have been prepared in accordance with the provisions of the Public Finance and Audit Act 1983, the Public Finance and Audit Regulation 2015 and the Treasurer’s Directions;

(b) The financial statements exhibit a true and fair view of the financial position and transactions of the Agency for the period ended 30 June 2016;

(c) At the date of this statement there are no circumstances, which would render any particulars included in the financial statements to be misleading or inaccurate.

Brett Newman Philip Shelley Chairman General Manager 30 September 2016 30 September 2016

32 33


34

[Start of Audited Financial Statements]

Statement of Comprehensive IncomeFor the Year Ended 30 June 2016

Note2016

$’000 2015 $’000

REVENUES

Rental Income 2 10,551 10,335

Investment Income 243 216

Other Income 71 38

Grant from Department of Education and Communities 600 600

State Government Contribution 3 5,868 5,725

TOTAL REVENUES 17,333 16,914

EXPENSES

Property Maintenance 4 6,641 7,554

Property Rates 5 2,342 2,145

Personnel Services Expense 6 2,129 1,753

Borrowing Costs 302 95

Other Administration Expenses 7 3,160 3,271

Depreciation 10(a) 5,252 5,366

TOTAL EXPENSES 19,826 20,184

Profit (Loss) on Disposal of Non-Current Assets 10(b) 39 78

Net result for the Year (2,454) (3,192)

OTHER COMPREHENSIVE INCOME

Items that will not be reclassified to net result

Net increase/(decrease) in property, plant and equipment revaluation surplus

10(a) 2,524 24,003

TOTAL OTHER COMPREHENSIVE INCOME 2,524 24,003

TOTAL COMPREHENSIVE INCOME 70 20,811

The accompanying notes form part of these statements

34

[Start of Audited Financial Statements]

Statement of Comprehensive IncomeFor the Year Ended 30 June 2016

Note2016

$’000 2015 $’000

REVENUES

Rental Income 2 10,551 10,335


Other Income 71 38

Grant from Department of Education and Communities 600 600


TOTAL REVENUES 17,333 16,914

EXPENSES

Property Maintenance 4 6,641 7,554

Property Rates 5 2,342 2,145

Personnel Services Expense 6 2,129 1,753

Borrowing Costs 302 95

Other Administration Expenses 7 3,160 3,271

Depreciation 10(a) 5,252 5,366

TOTAL EXPENSES 19,826 20,184

Profit (Loss) on Disposal of Non-Current Assets 10(b) 39 78

Net result for the Year (2,454) (3,192)

OTHER COMPREHENSIVE INCOME

Items that will not be reclassified to net result

Net increase/(decrease) in property, plant and equipment revaluation surplus

10(a) 2,524 24,003

TOTAL OTHER COMPREHENSIVE INCOME 2,524 24,003

TOTAL COMPREHENSIVE INCOME 70 20,811


35


Statement of Financial PositionAs at 30 June 2016

Note2016

$’000 2015 $’000

ASSETS

Current Assets

Cash and Cash Equivalents 8 5,942 7,221

Receivables 9 304 336

Non-Current Assets Held For Sale 10(a) 1,194 2,260

Total Current Assets 7,440 9,817

Non-Current Assets

Property, Plant and Equipment 10(a) 162,707 161,255

Amortised Borrowing Cost – 135

Total Non-Current Assets 162,707 161,390

TOTAL ASSETS 170,147 171,207

LIABILITIES

Current Liabilities

Payables 12 1,478 1,271

Borrowings 13 – 164

Total Current Liabilities 1,478 1,435

Non-Current Liabilities

Borrowings 13 – 1,173

Total Non-Current Liabilities – 1,173

TOTAL LIABILITIES 1,478 2,608

NET ASSETS 168,669 168,599

Equity

Reserves 95,626 94,563

Accumulated Funds 73,043 74,036

TOTAL EQUITY 168,669 168,599


36


Note

Accumulated Funds $’000

Asset Revaluation

Reserve $’000

Total $’000

Balance as at 1 July 2015 74,036 94,563 168,599

Net result for the year (2,454) – (2,454)

Other comprehensive income:

Net increase / (decrease) in property, plant and equipment

10(a) – 2,524 2,524

Transfer from Asset Revaluation Reserve on disposal of property, plant and equipment

1,461 (1,461) –

Total other comprehensive income 1,461 1,063 2,524

Total comprehensive income for the year (993) 1,063 70

Balance as at 30 June 2016 73,043 95,626 168,669




Net increase/(decrease) in property, plant and equipment

10(a) – 24,003 24,003

Transfer from Asset Revaluation Reserve on disposal of Property, plant and equipment

3,566 (3,566) –


Total comprehensive income for the year 374 20,437 20,811



36


Note

Accumulated Funds $’000

Asset Revaluation

Reserve $’000

Total $’000




Net increase / (decrease) in property, plant and equipment

10(a) – 2,524 2,524

Transfer from Asset Revaluation Reserve on disposal of property, plant and equipment

1,461 (1,461) –


Total comprehensive income for the year (993) 1,063 70





Net increase/(decrease) in property, plant and equipment

10(a) – 24,003 24,003

Transfer from Asset Revaluation Reserve on disposal of Property, plant and equipment

3,566 (3,566) –


Total comprehensive income for the year 374 20,437 20,811



37


Statement of Cash FlowsFor the Year Ended 30 June 2016

Note2016

$’000 2015 $’000

Cash Flows from Operating Activities

Payments

Property and Administration (11,490) (14,091)

Personnel Services Expense (2,662) (2,085)

Finance Expenses (167) –

Total Payments (14,319) (16,176)

Receipts

Rental Income 10,669 10,473


Other Income 71 38

Total Receipts 10,983 10,727

Cash Flows from Government


Department of Education and Communities Contribution 600 600

Net Cash Flows from Government 6,468 6,325

Net Cash Flows From Operating Activities 16 3,132 876

Cash Flows from Investing Activities

Proceeds from Disposal of Non-Current Assets 10(b) 1,657 3,856

Purchases of Non-Current Assets 10(a) (4,731) (3,288)

Sale of Investment – 4,108

Net Cash Flows From Investing Activities (3,074) 4,676

Cash Flows from Financing Activities

Repayment of borrowings 13(a) (1,337) (229)

Net Cash Flows from Financing Activities (1,337) (229)

Net Increase/(Decrease) in Cash (1,279) 5,323

OPENING CASH AND CASH EQUIVALENTS 7,221 1,898

CLOSING CASH AND CASH EQUIVALENTS 8 5,942 7,221


38

Notesaccompanying and forming part of the Financial Statements for the period ended 30 June 2016

1. Summary of Significant Accounting Policies

(a) Reporting EntityThe Teacher Housing Authority of NSW, is a NSW government entity. The Teacher Housing Authority of NSW is a not-for-profit entity (as profit is not its principal objective) and it has no cash generating units. The Authority is consolidated as part of the NSW Total State Sector Accounts.

The Authority provides a portfolio of houses and furnished units in areas of the state which do not have a viable private rental market. The provision of accommodation is one of several incentives which assist the Department of Education and Communities in attracting and retaining teachers in parts of the state which are considered to be “hard to staff”.

The financial statements for the year ended 30 June 2016 have been authorised for issue by the Board on 30 September 2016.

(b) Basis of PreparationThe Authority’s financial statements are general purpose financial statements which have been prepared on an accruals basis in accordance with:

• applicable Australian Accounting Standards (which include Australian Accounting Interpretations);

• the requirements of the Public Finance and Audit Act 1983 and Public Finance and Audit Regulation 2015.

Property, plant and equipment, assets held for sale and financial assets at ‘fair value through profit or loss’ are measured at fair value. Other financial statement items are prepared in accordance with historical cost convention except where specified otherwise.

Judgements, key assumptions and estimations made by the Authority’s management are disclosed in the relevant notes to the financial statements.

All amounts are rounded to the nearest one thousand dollars and are expressed in Australian currency.

At 30 June 2016, the Authority’s current assets exceeded its current liabilities by $6.0m ($8.4m in 2015).

Management and Board assert the going concern assumption is appropriate as its revenue streams are fixed and variable costs, such as future property maintenance and the capital expenditure program, can be reduced or deferred, if required.

(c) Statement of ComplianceThe Authority’s financial statements and notes comply with Australian Accounting Standards, which include Australian Accounting Interpretations.

(d) Income RecognitionIncome is measured at the fair value of the consideration or contribution received or receivable. Rental income is recognised in accordance with AASB 118 Revenue on accrual basis in accordance with the substance of the relevant agreement.

The Authority receives an annual state government contribution from Department of Finance, Services & Innovation (DFSI) and a capital grant from the Department of Education and Communities. These are recognised as income upon receipt.

Investment income, including interest revenue is recognised using the effective interest method as set out in AASB 139 Financial Instruments: Recognition and Measurement.

(e) Personnel Services and other provisionsThe Authority receives personnel services from the Department of Finance, Services & Innovation (DFSI). The Department is not a Special Purpose Service Entity and does not control the Authority under this arrangement.

(f) Borrowing CostsBorrowing costs are recognised as expenses in the period in which they are incurred, in accordance with Treasury’s Mandate to not-for-profit general government sector agencies.

(g) InsuranceThe Authority’s insurance activities are conducted through the NSW Treasury Managed Fund Scheme of self- insurance for Government agencies. The expense (premium) is determined by the Fund Manager based on past claims experience.

38

Notesaccompanying and forming part of the Financial Statements for the period ended 30 June 2016

1. Summary of Significant Accounting Policies

(a) Reporting EntityThe Teacher Housing Authority of NSW, is a NSW government entity. The Teacher Housing Authority of NSW is a not-for-profit entity (as profit is not its principal objective) and it has no cash generating units. The Authority is consolidated as part of the NSW Total State Sector Accounts.

The Authority provides a portfolio of houses and furnished units in areas of the state which do not have a viable private rental market. The provision of accommodation is one of several incentives which assist the Department of Education and Communities in attracting and retaining teachers in parts of the state which are considered to be “hard to staff”.

The financial statements for the year ended 30 June 2016 have been authorised for issue by the Board on 30 September 2016.

(b) Basis of PreparationThe Authority’s financial statements are general purpose financial statements which have been prepared on an accruals basis in accordance with:

• applicable Australian Accounting Standards (which include Australian Accounting Interpretations);

• the requirements of the Public Finance and Audit Act 1983 and Public Finance and Audit Regulation 2015.

Property, plant and equipment, assets held for sale and financial assets at ‘fair value through profit or loss’ are measured at fair value. Other financial statement items are prepared in accordance with historical cost convention except where specified otherwise.

Judgements, key assumptions and estimations made by the Authority’s management are disclosed in the relevant notes to the financial statements.

All amounts are rounded to the nearest one thousand dollars and are expressed in Australian currency.

At 30 June 2016, the Authority’s current assets exceeded its current liabilities by $6.0m ($8.4m in 2015).

Management and Board assert the going concern assumption is appropriate as its revenue streams are fixed and variable costs, such as future property maintenance and the capital expenditure program, can be reduced or deferred, if required.

(c) Statement of ComplianceThe Authority’s financial statements and notes comply with Australian Accounting Standards, which include Australian Accounting Interpretations.

(d) Income RecognitionIncome is measured at the fair value of the consideration or contribution received or receivable. Rental income is recognised in accordance with AASB 118 Revenue on accrual basis in accordance with the substance of the relevant agreement.

The Authority receives an annual state government contribution from Department of Finance, Services & Innovation (DFSI) and a capital grant from the Department of Education and Communities. These are recognised as income upon receipt.

Investment income, including interest revenue is recognised using the effective interest method as set out in AASB 139 Financial Instruments: Recognition and Measurement.

(e) Personnel Services and other provisionsThe Authority receives personnel services from the Department of Finance, Services & Innovation (DFSI). The Department is not a Special Purpose Service Entity and does not control the Authority under this arrangement.

(f) Borrowing CostsBorrowing costs are recognised as expenses in the period in which they are incurred, in accordance with Treasury’s Mandate to not-for-profit general government sector agencies.

(g) InsuranceThe Authority’s insurance activities are conducted through the NSW Treasury Managed Fund Scheme of self- insurance for Government agencies. The expense (premium) is determined by the Fund Manager based on past claims experience.

39


Notes accompanying and forming part of the Financial Statements for the year ended 30 June 2016

(h) Accounting for the Goods and Services Tax (GST)

The Authority is classified as a full input-taxed entity as all core-business revenues are generated from input-taxed supplies. Accordingly, all expenses, assets and payables relating to these supplies are recognised inclusive of GST. Cash flows are included in the statement of cash flows on a gross basis.

(i) Assets i. Acquisitions of Assets

The cost method of accounting is used for the initial recording of all acquisitions of assets controlled by the Authority. Cost is the amount of cash or cash equivalents paid or the fair value of the other consideration given to acquire the asset at the time of its acquisition or construction or, where applicable, the amount attributed to that asset when initially recognised in accordance with the specific requirements of other Australian Accounting Standards.

Assets acquired at no cost, or for nominal consideration, are initially recognised at their fair value at the date of acquisition.

Fair value is the price that would be received to sell an asset in an orderly transaction between market participants at measurement date.

Where payment for an asset is deferred beyond normal credit terms, its cost is the cash price equivalent, i.e. deferred payment amount is effectively discounted over the period of credit.

ii. Capitalisation Thresholds

Plant and equipment and intangible assets costing $5,000 and above individually, are capitalised.

iii. Revaluation of Property, Plant and Equipment

Physical non-current assets are valued in accordance with the ‘Valuation of Physical Non-Current Assets at Fair Value’ Policy and Guidelines Paper (TPP 14-01). This policy adopts fair value in accordance with AASB 13 Fair Value Measurement, AASB 116 Property, Plant and Equipment and AASB 140 Investment Property.

Property, plant and equipment is measured at the highest and best use by market participants that is physically possible, legally permissible and financially feasible. The highest and best use must be available at a period that is not remote and take into account

the characteristics of the asset being measured, including any socio-political restrictions imposed by government. In most cases, after taking into account these considerations, the highest and best use is the existing use. In limited circumstances, the highest and best use may be a feasible alternative use, where there are no restrictions on use or where there is a feasible higher restricted alternative use.

Fair value of property, plant and equipment is based on a market participants’ perspective, using valuation techniques (market approach, cost approach, income approach) that maximise relevant observable inputs and minimise unobservable inputs. Also refer Note 10 and Note 11 for further information regarding fair value.

Revaluations shall be made with sufficient regularity to ensure the carrying amount of each asset in the class does not differ materially from its fair value at reporting date.

The Authority adopted the “Use of sampling in asset valuation” method to determine the fair value of its land and buildings. This method is outlined in Appendix B of TPP14-01 “Accounting Policy: Valuation of Physical Non-Current Assets at Fair Value” that was issued by Treasury in February 2014. A methodology was implemented where assets are grouped based on Local Government Areas, the type of residence and the construction material, and a residence or a subset of residences is then selected from each Group.

The Authority conducts a comprehensive rolling revaluation over every three years for its land and buildings by revaluing a sample of properties each year and projecting the movement in the sample to the entire portfolio every year. Samples are reviewed each year to ensure they adequately represent the remaining assets in the respective group. The sampling exercise is summarized in the table below.

Sample No. Year 1 Year 2 Year 3

Sample 1 (Base) >12% >12% >12%

Sample 2 >7%

Sample 3 >7%

Sample 4 >7%

New Supply (est.) 1%–3% 1%–3% 1%–3%

Estimated percent pa >20% >20% >20%

40


The last comprehensive revaluation was completed on 28th February 2016 with an effective date as at 31st March 2016 and was based on an independent assessment.

Non-specialised assets with short useful lives are measured at depreciated historical cost, as an approximation of value. The entity has assessed that any difference between fair value and depreciated historical cost is unlikely to be material.

When revaluing non-current assets using the cost approach, the gross amount and the related accumulated depreciation are separately restated.

For other assets valued using other valuation techniques, any balances of accumulated depreciation at the revaluation date in respect of those assets are credited to the asset accounts to which they relate. The net asset accounts are then increased or decreased by the revaluation increments or decrements.

Revaluation increments are credited directly to revaluation surplus, except that, to the extent that an increment reverses a revaluation decrement in respect of that class of asset previously recognised as an expense in the net result, the increment is recognised immediately as revenue in the net result.

Revaluation decrements are recognised immediately as expenses in the net result, except that, to the extent that a credit balance exists in the revaluation surplus in respect of the same class of assets, they are debited directly to the revaluation surplus.


Where an asset that has previously been revalued is disposed of, any balance remaining in the revaluation surplus in respect of that asset is transferred to accumulated funds.

iv. Impairment of Property, Plant and Equipment

As a not-for-profit entity with no cash generating units, impairment under AASB 136 Impairment of Assets is unlikely to arise. As property, plant and equipment is carried at fair value or an amount that approximates fair value, impairment can only arise in the rare circumstances such as where the costs of disposal are material. Specifically, impairment is unlikely for not-for-profit entities given that AASB 136 modifies

the recoverable amount test for non-cash generating assets of not-for-profit entities to the higher of fair value less costs of disposal and depreciated replacement cost, where depreciated replacement cost is also fair value.

v. Depreciation of Property, Plant and Equipment

Depreciation is provided for on a straight-line basis for all depreciable assets so as to write off the depreciable amount of each asset as it is consumed over its useful life to the Authority. All material identifiable components of assets are depreciated separately over their useful lives. Land is not a depreciable asset.

The rates determined for the 2016 financial year are:

i) Buildings 2.0% or over remaining useful lives

ii) Office Furniture and Equipment 33.33%

(j) MaintenanceDay-to-day servicing costs or maintenance are charged as expenses as incurred, except where they relate to the replacement of a part or component of an asset, in which case the costs are capitalised and depreciated.

(k) Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. These financial assets are recognised initially at fair value, usually based on the transaction cost, or face value. Subsequent measurement is at amortised cost using the effective interest method, less an allowance for any impairment of receivables. Any changes are recognised in the net result for the year when impaired, derecognised or through the amortisation process.

Short-term receivables with no stated interest rate are measured at the original invoice amount where the effect of discounting is immaterial.

(l) Investments Investments are initially recognised at fair value plus, in the case of investments not at fair value through profit or loss, transaction costs.

The Authority determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this at each financial year end.

40


The last comprehensive revaluation was completed on 28th February 2016 with an effective date as at 31st March 2016 and was based on an independent assessment.

Non-specialised assets with short useful lives are measured at depreciated historical cost, as an approximation of value. The entity has assessed that any difference between fair value and depreciated historical cost is unlikely to be material.

When revaluing non-current assets using the cost approach, the gross amount and the related accumulated depreciation are separately restated.

For other assets valued using other valuation techniques, any balances of accumulated depreciation at the revaluation date in respect of those assets are credited to the asset accounts to which they relate. The net asset accounts are then increased or decreased by the revaluation increments or decrements.

Revaluation increments are credited directly to revaluation surplus, except that, to the extent that an increment reverses a revaluation decrement in respect of that class of asset previously recognised as an expense in the net result, the increment is recognised immediately as revenue in the net result.

Revaluation decrements are recognised immediately as expenses in the net result, except that, to the extent that a credit balance exists in the revaluation surplus in respect of the same class of assets, they are debited directly to the revaluation surplus.


Where an asset that has previously been revalued is disposed of, any balance remaining in the revaluation surplus in respect of that asset is transferred to accumulated funds.

iv. Impairment of Property, Plant and Equipment

As a not-for-profit entity with no cash generating units, impairment under AASB 136 Impairment of Assets is unlikely to arise. As property, plant and equipment is carried at fair value or an amount that approximates fair value, impairment can only arise in the rare circumstances such as where the costs of disposal are material. Specifically, impairment is unlikely for not-for-profit entities given that AASB 136 modifies

the recoverable amount test for non-cash generating assets of not-for-profit entities to the higher of fair value less costs of disposal and depreciated replacement cost, where depreciated replacement cost is also fair value.

v. Depreciation of Property, Plant and Equipment

Depreciation is provided for on a straight-line basis for all depreciable assets so as to write off the depreciable amount of each asset as it is consumed over its useful life to the Authority. All material identifiable components of assets are depreciated separately over their useful lives. Land is not a depreciable asset.

The rates determined for the 2016 financial year are:

i) Buildings 2.0% or over remaining useful lives

ii) Office Furniture and Equipment 33.33%

(j) MaintenanceDay-to-day servicing costs or maintenance are charged as expenses as incurred, except where they relate to the replacement of a part or component of an asset, in which case the costs are capitalised and depreciated.

(k) Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. These financial assets are recognised initially at fair value, usually based on the transaction cost, or face value. Subsequent measurement is at amortised cost using the effective interest method, less an allowance for any impairment of receivables. Any changes are recognised in the net result for the year when impaired, derecognised or through the amortisation process.

Short-term receivables with no stated interest rate are measured at the original invoice amount where the effect of discounting is immaterial.

(l) Investments Investments are initially recognised at fair value plus, in the case of investments not at fair value through profit or loss, transaction costs.

The Authority determines the classification of its financial assets after initial recognition and, when allowed and appropriate, re-evaluates this at each financial year end.

41



(m) Impairment of Financial AssetsAll financial assets, except those measured at fair value through profit and loss, are subject to an annual review for impairment. An allowance for impairment is established when there is objective evidence that the entity will not be able to collect all amounts due.

For financial assets carried at amortised cost, the amount of the allowance is the difference between the asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. The amount of the impairment loss is recognised in the net result for the year.

Any reversals of impairment losses are reversed through the net result for the year, where there is objective evidence.

(n) Non-current assets (or disposal groups) held for sale

The entity has certain non-current assets (or disposal groups) classified as held for sale, where their carrying amount will be recovered principally through a sale transaction, not through continuing use. Non-current assets (or disposal groups) held for sale are recognised at the lower of carrying amount and fair value less costs of disposal. These assets are not depreciated while they are classified as held for sale.

(o) PayablesThese amounts represent liabilities for goods and services provided to the Authority and other amounts, including interest. Payables are recognised initially at fair value, usually based on the transaction cost or face value. Subsequent measurement is at amortised cost using the effective interest method. Short-term payables with no stated interest rate are measured at the original invoice amount where the effect of discounting is immaterial.

(p) Fair value hierarchyA number of the entity’s accounting policies and disclosures require the measurement of fair values, for both financial and non-financial assets and liabilities. When measuring fair value, the valuation technique used maximises the use of relevant observable inputs and minimises the use of unobservable inputs. Under AASB 13, the entity categorises, for disclosure purposes, the valuation techniques based on the inputs used in the valuation techniques as follows:

• Level 1 – quoted prices in active markets for identical assets / liabilities that the entity can access at the measurement date.

• Level 2 – inputs other than quoted prices included within Level 1 that are observable, either directly or indirectly.

• Level 3 – inputs that are not based on observable market data (unobservable inputs).

The entity recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred. Refer Note 11 and Note 17 for further disclosure regarding fair value measurements of financial and non-financial assets.

(q) Equity and reserves(i) Revaluation reserve

The revaluation surplus is used to record increments and decrements on the revaluation of non-current assets. This accords with the entity’s policy on the revaluation of property, plant and equipment as discussed in note 1(i).

(ii) Accumulated Funds

The category ‘Accumulated Funds’ includes all current and prior period retained funds.

(iii) Separate reserve accounts

Separate reserve accounts are recognised in the financial statements only if such accounts are required by specific legislation or Australian Accounting Standards (e.g. revaluation reserve and foreign currency translation reserve).

(r) Comparative informationExcept when an Australian Accounting Standard permits or requires otherwise, comparative information is presented in respect of the previous period for all amounts reported in the financial statements.

(s) Changes in accounting policy, including new or revised Australian Accounting Standards

(i) Effective for the first time in 2015–16

The accounting policies applied in 2015–2016 are consistent with those of the previous financial year except as a result of the following new or revised Australian Accounting Standards that have been applied for the first time in 2015–2016:

42


• AASB 2013–9 (Part C), AASB 2014–1 (Part E) and AASB 2014–8 regarding amendments to AASB 9 Financial Instruments

• AASB 2015–3 regarding withdrawal of AASB 1031 Materiality

The above standards have all been fully compiled into their respective standards, with the exception of AASB 2014–1 (Part E).

The application of these Standards did not have any material impact on the Authority’s financial statements.

(ii) Issued but not yet effective

NSW public sector entities are not permitted to early adopt new Australian Accounting Standards, unless Treasury determines otherwise. There are a number of recently issued or amended Australian Accounting Standards which are not yet effective and have not been adopted for the reporting period ending 30 June 2016. The following Standards are relevant to the Authority:

• AASB 9 and AASB 2014–7 regarding financial instruments

• AASB 14 and AASB 2014–1(Part D) regarding Regulatory Deferral Accounts

• AASB 15, AASB 2014–5 and AASB 2015–8 regarding Revenue from Contracts with Customers

• AASB 1056 Superannuation Entities

• AASB 1057 and AASB 2015–9 Application of Australian Accounting Standards

• AASB 2014–4 regarding acceptable methods of depreciation and amortisation

• AASB 2014–6 regarding bearer plants

• AASB 2014–9 regarding equity method in separate financial statements

• AASB 2015–1 regarding annual improvements to Australian Accounting Standards 2012–2014 cycle

• AASB 2015–2 regarding amendments to AASB 101 (disclosure initiative)

• AASB 2015–6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-for-Profit Public Sector Entities

• AASB 2015–7 Amendments to Australian Accounting Standards – Fair Value Disclosures of Not-for-Profit Public Sector Entities

The Authority does not expect any material impact on the financial statements in the period of initial application of these Standards.

42


• AASB 2013–9 (Part C), AASB 2014–1 (Part E) and AASB 2014–8 regarding amendments to AASB 9 Financial Instruments

• AASB 2015–3 regarding withdrawal of AASB 1031 Materiality

The above standards have all been fully compiled into their respective standards, with the exception of AASB 2014–1 (Part E).

The application of these Standards did not have any material impact on the Authority’s financial statements.

(ii) Issued but not yet effective

NSW public sector entities are not permitted to early adopt new Australian Accounting Standards, unless Treasury determines otherwise. There are a number of recently issued or amended Australian Accounting Standards which are not yet effective and have not been adopted for the reporting period ending 30 June 2016. The following Standards are relevant to the Authority:

• AASB 9 and AASB 2014–7 regarding financial instruments

• AASB 14 and AASB 2014–1(Part D) regarding Regulatory Deferral Accounts

• AASB 15, AASB 2014–5 and AASB 2015–8 regarding Revenue from Contracts with Customers

• AASB 1056 Superannuation Entities

• AASB 1057 and AASB 2015–9 Application of Australian Accounting Standards

• AASB 2014–4 regarding acceptable methods of depreciation and amortisation

• AASB 2014–6 regarding bearer plants

• AASB 2014–9 regarding equity method in separate financial statements

• AASB 2015–1 regarding annual improvements to Australian Accounting Standards 2012–2014 cycle

• AASB 2015–2 regarding amendments to AASB 101 (disclosure initiative)

• AASB 2015–6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-for-Profit Public Sector Entities

• AASB 2015–7 Amendments to Australian Accounting Standards – Fair Value Disclosures of Not-for-Profit Public Sector Entities

The Authority does not expect any material impact on the financial statements in the period of initial application of these Standards.

43


2. Rental Revenue

Rental Income comprise: 2016 $’000

2015 $’000

Gross Rental Income 10,551 10,335

Total Rental Income 10,551 10,335

3. State Government ContributionRental and investment income is sufficient to fund a portion of the Authority’s operating and capital costs. However, the Authority is dependent on continued subsidisation from the State Government to fund the balance of these costs.

State Government Contribution comprise: 2016 $’000

2015 $’000

Grant from Department of Finance, Services & Innovation 5,868 5,725

Total State Government Contribution 5,868 5,725

4. Property Maintenance

Property Maintenance Expenses comprise: 2016 $’000

2015 $’000

Plumbing 473 514

Electrical 295 308

General Maintenance 1,405 559

Ground/ Yard Maintenance 1,020 1,006

Air Cooling Installation and Maintenance 453 608

Air Conditioners & Fans 98 10

Furnishings, Fixtures and Fittings 664 724

Property Refurbishment 2,233 3,531

Other Maintenance – 294

Total Property Maintenance Expenses 6,641 7,554

44


5. Property Rates

Property Rates comprise: 2016 $’000

2015 $’000

Annual Rates 1,548 1,527

Water Rates 728 547

Other 66 71

Total Property Rates 2,342 2,145

6. Personnel ServicesPersonnel services are acquired from the Department of Finance,Services & Innovation comprise of:

Personnel Services comprise: 2016 $’000

2015 $’000

Salaries and Wages 1,527 1,429

Recreation Leave 112 104

Long Service Leave 61 25

Superannuation 97 (83)

Total 1,797 1,475

Other Personnel Services Expense 332 278

Total Personnel Services Expense 2,129 1,753

7. Other Administration Expenses

Other Administration Expenses comprise: 2016 $’000

2015 $’000

Consultants 64 129

Office Lease Expense 186 197

Insurance 376 423

Property Valuations 165 449

Property Management Fees 849 885

IT Costs 597 167

Travel Expenses 70 77

Admin Cost – Outsourcing 636 621

Other General Administration 217 323

Total Other Administration Expenses 3,160 3,271

44


5. Property Rates

Property Rates comprise: 2016 $’000

2015 $’000

Annual Rates 1,548 1,527

Water Rates 728 547

Other 66 71

Total Property Rates 2,342 2,145

6. Personnel ServicesPersonnel services are acquired from the Department of Finance,Services & Innovation comprise of:

Personnel Services comprise: 2016 $’000

2015 $’000

Salaries and Wages 1,527 1,429

Recreation Leave 112 104

Long Service Leave 61 25

Superannuation 97 (83)

Total 1,797 1,475

Other Personnel Services Expense 332 278

Total Personnel Services Expense 2,129 1,753

7. Other Administration Expenses

Other Administration Expenses comprise: 2016 $’000

2015 $’000

Consultants 64 129

Office Lease Expense 186 197

Insurance 376 423

Property Valuations 165 449

Property Management Fees 849 885

IT Costs 597 167

Travel Expenses 70 77

Admin Cost – Outsourcing 636 621

Other General Administration 217 323

Total Other Administration Expenses 3,160 3,271

45



8. Cash and Cash Equivalents

Cash and Cash Equivalents comprise: 2016 $’000

2015 $’000

Cash on Hand 1 1

Cash at Bank 5,941 7,220

Total Cash and Cash Equivalents at 30 June 5,942 7,221

For the purposes of the statement of cash flows, cash and cash equivalents include cash at bank and cash on hand.

Cash and cash equivalent assets recognised in the statement of financial position are reconciled at the end of the financial year to the statement of cash flows as follows:

2016 $’000

2015 $’000

Cash and cash equivalents per statement of financial position 5,942 7,221

Cash and cash equivalents per statement of cash flows 5,942 7,221


9. Receivables

Receivables comprise: 2016 $’000

2015 $’000

Current:

Rental Debtors 77 111

Allowance for Impairment [Note 9(a)] (12) (25)

Tenancy Liaison Service Agent Advances 236 243

Prepayment 2 5

Other Debtors 1 2

Total Receivables 304 336

(a) Allowance for Impairment

Allowance for Impairment – movement 2016 $’000

2015 $’000

Opening Allowance at 1 July 25 20

Debts Written Off [Note 15] (16) 3

New Allowance Transferred In/(Out) 3 2

Closing Allowance at 30 June 12 25

Details regarding credit risk, liquidity risk and market risk, including financial assets that are either past due or impaired, are disclosed in Note 17.

46


10. Land and Buildings, Office Furniture and Equipment and Office Refurbishment

(a) Movement – ‘000

Land and Buildings

Land and Buildings held

for sale (1)

Office Furniture and

Equipment2016 Total

$’000

At Fair Value

Net Carrying Amount at 1 July 2015 161,255 2,260 – 163,515

Assets Under Construction (1,534) – – (1,534)

Additions 6,260 – 6 6,266

Disposals (271) (1,347) – (1,618)

Transfers – Assets For Sale (281) 281 – –

Net Revaluation Increments/ (Decrements)

2,524 – – 2,524

Depreciation Expenses (5,251) – (1) (5,252)

Fair Value at 30 June 2016 162,702 1,194 5 163,901


Land and Buildings


for sale (1)


Equipment2015 Total

$’000

At Fair Value


Assets Under Construction 1,397 – – 1,397

Additions 1,893 – – 1,893

Disposals (3,780) – – (3,780)

Transfers – Assets For Sale (975) 975 –


24,003 – – 24,003

Depreciation Expenses (5,366) – – (5,366)

Fair Value at 30 June 2015 161,255 2,260 – 163,515

46


10. Land and Buildings, Office Furniture and Equipment and Office Refurbishment


Land and Buildings


for sale (1)


Equipment2016 Total

$’000

At Fair Value


Assets Under Construction (1,534) – – (1,534)

Additions 6,260 – 6 6,266

Disposals (271) (1,347) – (1,618)

Transfers – Assets For Sale (281) 281 – –


2,524 – – 2,524

Depreciation Expenses (5,251) – (1) (5,252)

Fair Value at 30 June 2016 162,702 1,194 5 163,901


Land and Buildings


for sale (1)


Equipment2015 Total

$’000

At Fair Value


Assets Under Construction 1,397 – – 1,397

Additions 1,893 – – 1,893

Disposals (3,780) – – (3,780)

Transfers – Assets For Sale (975) 975 –


24,003 – – 24,003

Depreciation Expenses (5,366) – – (5,366)

Fair Value at 30 June 2015 161,255 2,260 – 163,515

47




Land and Buildings


for sale (1)


Equipment2016 Total

$’000

Gross Carrying Amount 30 June 2016 164,531 1,194 6 165,731

Accumulated Depreciation (1,829) – (1) (1,830)

Fair Value 162,702 1,194 5 163,901

2015

Gross Carrying Amount 30 June 2015 162,547 2,260 – 164,807

Accumulated Depreciation (1,292) – – (1,292)

Fair Value 161,255 2,260 – 163,515

(1) Land & Buildings held for sale are disclosed separately for reporting period June 2016 in accordance with ‘AASB 5 – Non–current assets held for sale and Discontinued operations’.

These assets will be disposed of because they are:

• at the end of their economic lives and it is unfeasible to upgrade them

• in locations where the private rental market adequately provides rental properties

• in locations where there is insufficient teacher demand and assets in that location are underutilised, or

• a combination of the above

In 2015 the Authority conducted a review of its asset portfolio. These disposals are in line with the recommendations in that review.

The following methods are used for disposing Authority assets.

a) to an NGO or government agency

b) by public auction or public listing

c) to a sitting tenant

d) by private treaty

These assets are expected to be realised by 30 June 2017.

A physical valuation was completed by an independent valuer on 28th February 2016 with values effective from 31st March 2016. For further details regarding the fair value measurement of property, plant and equipment refer to Note 1(i)(iii) Revaluation of Property, Plant and Equipment on page 39.

(b) Disposals $’000

2016 $’000

2015 $’000

Gross Proceeds 1,729 4,069

Written Down Value (1,618) (3,780)

Disposal Costs (72) (211)

Loss on Disposal 39 78

48


11. Fair Value Measurement of Non-Financial Assets

Fair value hierarchy

2016Level 1

$’000Level 2

$’000Level 3

$’000 Total fair

value $’000

Property, plant and equipment

Land and buildings 162,702 – 162,702

Non-current assets (or disposal groups) held for sale

Land and buildings – 1,194 – 1,194

TOTAL – 163,896 – 163,896

2015Level 1

$’000Level 2

$’000Level 3

$’000 Total fair

value $’000





TOTAL – 163,515 – 163,515

There were no transfers between Level 1 or 2 during the periods.

12. Payables

Payables comprise: 2016 $’000

2015 $’000

Payable to DFSI – 531

Prepayments by Tenants 30 33

Other Creditors and Accruals 1,448 707

Total Payables 1,478 1,271

Details regarding credit risk, liquidity risk and market risk, including a maturity analysis of the above payables, are disclosed in Note 17.

13. Borrowings

Borrowings comprise: 2016 $’000

2015 $’000

TCorp Loan (Current Liability) – 164

TCorp Loan (Non-Current Liability) – 1,173

Total Borrowings – 1,337


48


11. Fair Value Measurement of Non-Financial Assets

Fair value hierarchy

2016Level 1

$’000Level 2

$’000Level 3

$’000 Total fair

value $’000


Land and buildings 162,702 – 162,702



TOTAL – 163,896 – 163,896

2015Level 1

$’000Level 2

$’000Level 3

$’000 Total fair

value $’000





TOTAL – 163,515 – 163,515

There were no transfers between Level 1 or 2 during the periods.

12. Payables

Payables comprise: 2016 $’000

2015 $’000

Payable to DFSI – 531

Prepayments by Tenants 30 33

Other Creditors and Accruals 1,448 707

Total Payables 1,478 1,271


13. Borrowings

Borrowings comprise: 2016 $’000

2015 $’000

TCorp Loan (Current Liability) – 164

TCorp Loan (Non-Current Liability) – 1,173

Total Borrowings – 1,337


49



(a) TCorp LoanThe Authority received Treasurer’s approval to obtain financial accommodation for up to $5.0 million, under section 8(2) of the Public Authorities (Financial Arrangements) Act 1987. A Credit Foncier loan with a face value of $5.0 million was obtained from NSW Treasury Corporation in February 2012 at a fixed interest rate of 4.98 % for a term up to 10 years.

During 2015–16 the Authority paid TCorp loan principal $1.337m and interest $0.191m.

14. Commitments The Authority is classified as a fully input-taxed entity. As such, the Authority is not eligible to claim input tax credits from the Australian Taxation Office for any Goods and Services Tax (GST) paid on taxable acquisitions. Any GST paid on such acquisitions is accounted for as part of the cost of that acquisition and expensed or capitalised accordingly. Where applicable, the following commitments for expenditure on goods or services include the GST payable.

(a) Operating Lease Commitments The Authority entered into an Occupation Agreement with DFSI over a period of 5 years commencing 1 April 2011. The lease has expired on 1 April 2016 and no new agreement has been entered as at 30 June 2016.

Office Lease Commitments 2016 $’000

2015 $’000

Payable within one year – 186

Total Office Lease Commitments – 186

(b) Other Operating Commitments – Property Maintenance and School Residence Refurbishment

Expenditure commitments for property maintenance and school residence refurbishments arise from contracts entered into for the provision of contingent maintenance and programmed maintenance for dwellings included within the Authority’s annual Property Refurbishment Program. The amount contracted for at balance date but not recognised in the accounts as a liability is:

Property Maintenance Commitments 2016 $’000

2015 $’000

Payable within one year 666 –

Total Property Maintenance Commitments 666 –

(c) Capital CommitmentsCapital expenditure commitments arise from contracts entered into for the construction, acquisition and upgrading of dwellings included within the Authority’s Capital Program. The amount contracted for at balance date but not recognised in the accounts as a liability is:

Capital Commitments 2016 $’000

2015 $’000

Payable within one year 10 –

Payable between two years 7

Total Capital Commitments 17 –

50


15. Debts Written Off

Debts Written Off Comprise: 2016 $’000

2015 $’000

Uncollectable rental account debts [Note 9(a)] 16 11

Total Debts Written Off 16 11

All possible action was taken to recover these debts before authority was obtained for write–off action.

16. Reconciliation of Net Cash Flow from Operating Activities to Operating Deficit

For the purposes of the Statement of Cash Flows, cash includes cash on hand, cash at bank and investments readily convertible to cash. Cash at the end of the financial year as shown in the Statement of Cash Flows is reconciled at Note 8.

Reconciliation of Cash Flow from Operating Activities to Net result as reported in the Statement of Comprehensive Income

2016 $’000

2015 $’000

Net result (2,454) (3,192)

Non Cash Expenses/(Revenues):

Depreciation 5,252 5,366

Loss/(Gain) on Disposal of Non–Current Assets (39) (78)

Borrowing Costs – TCorp Loan 134 95

Changes in Operating Assets and Liabilities:

Increase/(Decrease) in Payables and other liabilities 207 (590)

Decrease/(Increase) in Receivables 32 208

Increase/(Decrease) in Provisions – (933)

Net Cash inflow/(outflow) from Operating Activities 3,132 876

50


15. Debts Written Off

Debts Written Off Comprise: 2016 $’000

2015 $’000

Uncollectable rental account debts [Note 9(a)] 16 11

Total Debts Written Off 16 11

All possible action was taken to recover these debts before authority was obtained for write–off action.

16. Reconciliation of Net Cash Flow from Operating Activities to Operating Deficit

For the purposes of the Statement of Cash Flows, cash includes cash on hand, cash at bank and investments readily convertible to cash. Cash at the end of the financial year as shown in the Statement of Cash Flows is reconciled at Note 8.

Reconciliation of Cash Flow from Operating Activities to Net result as reported in the Statement of Comprehensive Income

2016 $’000

2015 $’000

Net result (2,454) (3,192)

Non Cash Expenses/(Revenues):

Depreciation 5,252 5,366

Loss/(Gain) on Disposal of Non–Current Assets (39) (78)

Borrowing Costs – TCorp Loan 134 95

Changes in Operating Assets and Liabilities:

Increase/(Decrease) in Payables and other liabilities 207 (590)

Decrease/(Increase) in Receivables 32 208

Increase/(Decrease) in Provisions – (933)

Net Cash inflow/(outflow) from Operating Activities 3,132 876

51



17. Financial InstrumentsThe Authority’s principal financial instruments are outlined below. These financial instruments arise directly from the Authority’s operations or are required to finance the Authority’s operations. The Authority does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.

The Authority’s main risks arising from financial instruments are outlined below, together with the Authority’s objectives, policies and processes for measuring and managing risk. Further quantitative and qualitative disclosures are included throughout these financial statements.

The Board has overall responsibility for the establishment and oversight of risk management and reviews and agrees policies for managing each of these risks. Risk management policies are established to identify and analyse the risks faced by the Authority, to set risk limits and controls and to monitor risks. Compliance with policies is reviewed by the Authority on a regular basis.

(a) Financial Instrument Categories

Financial Assets Carrying Amount

Class: Note Category2016

$’0002015

$’000

Cash and cash equivalents 8 Not Applicable 5,942 7,221

Receivables(1) 9 Loans and Receivables (at amortised cost)

304 336

Payables(2) 12 Financial liabilities measured at amortised cost

1,478 740

Borrowings 13 Financial liabilities measured at amortised cost

– 1,337

Notes

(1) Excludes statutory receivables and prepayments (i.e. not within scope of AASB 7)

(2) Excludes statutory payables and unearned revenue (i.e. not within scope of AASB 7)

(b) Credit RiskCredit risk arises when there is the possibility of the Authority’s debtors defaulting on their contractual obligations, resulting in a financial loss to the Authority. The maximum exposure to credit risk is generally represented by the carrying amount of the financial assets (net of any allowance for impairment).

Credit risk arises from the financial assets of the Authority, including cash, receivables, and authority deposits. No collateral is held by the Authority. The Authority has not granted any financial guarantees.

Credit risk associated with the Authority’s financial assets, other than receivables, is managed through the selection of counterparties and establishment of minimum credit rating standards. Authority deposits held with NSW TCorp are guaranteed by the State.

52


CashCash comprises cash on hand and bank balances within the NSW Treasury Banking system. Interest is earned on daily bank balances at the monthly average NSW Treasury Corporation (TCorp) 11 am unofficial cash rate, adjusted for a management fee to NSW Treasury.

Receivables – trade debtorsAll trade debtors are recognised as amounts receivable at balance date. Collectability of trade debtors is reviewed on an ongoing basis. Procedures as established in the Treasurer’s Directions are followed to recover outstanding amounts, including letters of demand. Debts which are known to be uncollectible are written off. An allowance for impairment is raised when there is objective evidence that the entity will not be able to collect all amounts due. This evidence includes past experience, and current and expected changes in economic conditions and debtor credit ratings. No interest is earned on trade debtors.

The Authority is not materially exposed to concentrations of credit risk to a single trade debtor or group of debtors. Based on past experience, debtors that are not past due (2016:Nil; 2015: Nil) are not considered impaired. Debtors that are more than 2 months past due (2016:$15k; 2015:$3k) are considered impaired and together these represent 19% of the total trade debtors. The Authority debtors represent a large number of individual teachers whose particular credit rating will vary and are unknown to the Authority. There are no debtors which are currently not past due or impaired whose terms have been renegotiated.

The only financial assets that are past due or impaired are ‘sales of goods and services’ in the ‘receivables’ category of the statement of financial position.

June 2016 ($’000) Total(1)(2)

Past due but not impaired(1)(2)

Considered impaired(1)(2)

1 month – 3 months overdue 72 65 7

3 months – 6 months overdue – – –

> 6 months overdue 5 – 5

2015 ($’000)

1 month – 3 months overdue 6 6 –

3 months – 6 months overdue 21 – 21

> 6 months overdue – – –

(1) Each column in the table reports “gross receivables”.

(2) The ageing analysis excludes statutory receivables, as these are not within the scope of AASB 7 and excludes receivables that are not past due and not impaired. Therefore, the total will not reconcile to the receivables total recognised in the statement of financial position.

52


CashCash comprises cash on hand and bank balances within the NSW Treasury Banking system. Interest is earned on daily bank balances at the monthly average NSW Treasury Corporation (TCorp) 11 am unofficial cash rate, adjusted for a management fee to NSW Treasury.

Receivables – trade debtorsAll trade debtors are recognised as amounts receivable at balance date. Collectability of trade debtors is reviewed on an ongoing basis. Procedures as established in the Treasurer’s Directions are followed to recover outstanding amounts, including letters of demand. Debts which are known to be uncollectible are written off. An allowance for impairment is raised when there is objective evidence that the entity will not be able to collect all amounts due. This evidence includes past experience, and current and expected changes in economic conditions and debtor credit ratings. No interest is earned on trade debtors.

The Authority is not materially exposed to concentrations of credit risk to a single trade debtor or group of debtors. Based on past experience, debtors that are not past due (2016:Nil; 2015: Nil) are not considered impaired. Debtors that are more than 2 months past due (2016:$15k; 2015:$3k) are considered impaired and together these represent 19% of the total trade debtors. The Authority debtors represent a large number of individual teachers whose particular credit rating will vary and are unknown to the Authority. There are no debtors which are currently not past due or impaired whose terms have been renegotiated.

The only financial assets that are past due or impaired are ‘sales of goods and services’ in the ‘receivables’ category of the statement of financial position.

June 2016 ($’000) Total(1)(2)

Past due but not impaired(1)(2)

Considered impaired(1)(2)

1 month – 3 months overdue 72 65 7

3 months – 6 months overdue – – –

> 6 months overdue 5 – 5

2015 ($’000)

1 month – 3 months overdue 6 6 –

3 months – 6 months overdue 21 – 21

> 6 months overdue – – –

(1) Each column in the table reports “gross receivables”.

(2) The ageing analysis excludes statutory receivables, as these are not within the scope of AASB 7 and excludes receivables that are not past due and not impaired. Therefore, the total will not reconcile to the receivables total recognised in the statement of financial position.

53



(c) Liquidity RiskLiquidity risk is the risk that the Authority will be unable to meet its payment obligations when they fall due. The Authority continuously manages risk through monitoring future cash flows and maturities planning to ensure adequate holding of high quality liquid assets. The objective is to maintain a balance between continuity of funding and flexibility through the use of overdrafts, loans and other advances.

During the current and prior year, there were no defaults or breaches on any loans payable. No assets have been pledged as collateral. The Authority’s exposure to liquidity risk is deemed insignificant based on prior periods’ data and current assessment of risk.

The liabilities are recognised for amounts due to be paid in the future for goods or services received, whether or not invoiced. Amounts owing to suppliers (which are unsecured) are settled in accordance with

the policy set out in NSW TC 11/12. For small business suppliers, where terms are not specified, payment is made not later than 30 days from date of receipt of a correctly rendered invoice. For other suppliers, if trade terms are not specified, payment is made no later than the end of the month following the month in which an invoice or a statement is received. For small business suppliers, where payment is not made within the specified time period, simple interest must be paid automatically unless an existing contract specifies otherwise. For payments to other suppliers, the Head of an authority (or a person appointed by the Head of an authority) may automatically pay the supplier simple interest. The Authority did not have to make any interest payment in this respect during the current or prior years.

The table below summarises the maturity profile of the Authority’s financial liabilities together with the interest rate exposure.

2016

Weighted Average

Effective Interest Rate

Nominal Amount(1)

($’000)

Interest Rate Exposure ($’000) Maturity Dates

Fixed Interest

Rate

Variable Interest

Rate

Non–interest Bearing < 1 yr 1–5 yrs > 5 yrs

Payables: – 1,478 – – 1,478 – – –

Borrowings: – – – – – – – –

2015

Payables: – 740 – – 740 – – –

Borrowings: 4.98% 1,337 262 – – 164 743 430

Notes

(1) The amounts disclosed are the contractual undiscounted cash flows of each class of financial liabilities based on the earliest date on which the entity can be required to pay. The tables include both interest and principal cash flows and will not reconcile to the Statement of Financial Position.

54


(d) Market RiskMarket risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Authority has no exposure to market risk. The Authority has no exposure to foreign currency risk and does not enter into commodity contracts.

The effect on profit and equity due to a reasonably possible change in risk variable is outlined in the information below, for interest rate risk and other price risk. A reasonably possible change in risk variable has been determined after taking into account the economic environment in which the entity operates and the time frame for the assessment (i.e. until the end of the next annual reporting period). The sensitivity analysis is based on risk exposures in existence at the statement of financial position date. The analysis is performed on the same basis as for 2015. The analysis assumes that all other variables remain constant.

(e) Interest rate riskExposure to interest rate risk arises primarily through the entity’s interest bearing liabilities. This risk is minimised by undertaking mainly fixed rate borrowings, from NSW TCorp. The Authority does not account for any fixed rate financial instruments at fair value through profit or loss or as available–for–sale. Therefore, for these financial instruments, a change in interest rates would not affect profit or loss or equity. A reasonably possible change of +/– 1% is used, consistent with current trends in interest rates. The basis will be reviewed annually and amended where there is a structural change in the level of interest rate volatility. The Authority’s exposure to interest rate risk is set out below.

($’000)

–1% +1%

Carrying Amount Result Equity Result Equity

2016

Financial assets

Cash and cash equivalents 5,942 (59) (59) 59 59

Receivables 304 – – – –

Financial liabilities

Payables 1,478 – – – –

Borrowings – – – – –

2015

Financial assets




Payables 740 – – – –

Borrowings 1,337 – – – –

54


(d) Market RiskMarket risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. The Authority has no exposure to market risk. The Authority has no exposure to foreign currency risk and does not enter into commodity contracts.

The effect on profit and equity due to a reasonably possible change in risk variable is outlined in the information below, for interest rate risk and other price risk. A reasonably possible change in risk variable has been determined after taking into account the economic environment in which the entity operates and the time frame for the assessment (i.e. until the end of the next annual reporting period). The sensitivity analysis is based on risk exposures in existence at the statement of financial position date. The analysis is performed on the same basis as for 2015. The analysis assumes that all other variables remain constant.

(e) Interest rate riskExposure to interest rate risk arises primarily through the entity’s interest bearing liabilities. This risk is minimised by undertaking mainly fixed rate borrowings, from NSW TCorp. The Authority does not account for any fixed rate financial instruments at fair value through profit or loss or as available–for–sale. Therefore, for these financial instruments, a change in interest rates would not affect profit or loss or equity. A reasonably possible change of +/– 1% is used, consistent with current trends in interest rates. The basis will be reviewed annually and amended where there is a structural change in the level of interest rate volatility. The Authority’s exposure to interest rate risk is set out below.

($’000)

–1% +1%

Carrying Amount Result Equity Result Equity

2016

Financial assets




Payables 1,478 – – – –

Borrowings – – – – –

2015

Financial assets




Payables 740 – – – –

Borrowings 1,337 – – – –

55



(f) Fair Value compared to carrying amountFinancial instruments are generally recognised at cost.

Except where specified below, the amortised cost of financial instruments recognised in the statement of financial position approximates the fair value, because of the short–term nature of many of the financial instruments. The following table details the financial instruments where the fair value differs from the carrying amount:

2016 $’000

Carrying Amount

2016 $’000 Value Level

2016 Fair

Value Level

2015 $’000

Carrying Amount

2015 $’000 Value Level

2015 Fair

Value Level

Financial assets

Cash and Cash Equivalents 5,942 5,942 Level 2 7,221 7,221 Level 2

Receivables 304 304 Level 2 336 336 Level 2


Payables 1,478 1,478 Level 2 740 740 Level 2

Borrowings – – Level 2 1,337 1,337 Level 2

The fair value of borrowings are based on all future discounted cash flows at current market yield of 3.87%.

18. Contingent Liabilities and Contingent AssetsThe Authority is unaware of any significant contingent liabilities or contingent assets as at 30 June 2016 (nil in June 2015).

19. After Balance Date EventsThere were no events subsequent to balance date which affect the financial statements.


56

Index Pages

Access to services 57

Account Payment Performance 12, 14


Aims and Objectives 2

Appendices 20

Asset Disposal 10, 20

Asset Management 9



Benchmarking 12

Business Continuity Plan (BCP) 19

Business Plan/Statement of Business Intent 19

Capital Delivery 16

Capital Program 10, 11, 20

Chairperson Report 4

Charter 2

Consultants 18

Contents 1


Customer Satisfaction 9

Disability Inclusion Plan 17

Eco Village 10

Employee Assistance Program 17

Equal Employment Opportunity 16

Field Trips 8




Flexible Accommodation 10


Government Property Register 17

Hazardous Materials 10

Heritage Assets 11

Housing Allocated 7

Housing Demand 8

Human Resources 16

Independent Auditors Report 32, 33

Industrial Relations 16

Information and Communications Technology 18

Insurance 17, 21

Internal Audit and Risk Management 18, 23

Internal Audit Plan 18


Pages

Key Performance Indicators 12, 15


Land Purchases 10

Loan Facility 12

Local Housing Representatives 7

Maintenance 11

Managing Agents 7


Multicultural Policies and Services Program 16

Notes 38

NSW Digital Information Security Policy, Compliance Attestation Statement 2015–16 19

NSW Public Sector Workforce Profile 17


Organisational Structure 16, 22

Other Activities 17

Overseas Travel 19


Principal Roles 16

Privacy and Personal Information Protection Act 1998 (PPIP Act) 17

Project Management 11

Property and Occupancy Data 15

Public Access to Government Information 17

Public Interest Disclosures (PID’s) 18

Public Sector Reforms and Legislative Changes 19

Related Entity 6

Rents 7

Rental subsidy 7

Review of Government Employee Accommodation 19

School Residences 11

Staffing Arrangement 16

Staffing Numbers 16, 21, 22

Stakeholders 16, 28

Statement by Members 31

Strategic Asset Management Plan 10


Vacancy/Occupancy Rate 8

Weekly Rental Amounts (applied from 1 May*) 15

Welcome Kit – Tenant Handbook 8

Workplace Health and Safety (WHS) 17

56

Index Pages

Access to services 57

Account Payment Performance 12, 14


Aims and Objectives 2

Appendices 20

Asset Disposal 10, 20

Asset Management 9



Benchmarking 12

Business Continuity Plan (BCP) 19

Business Plan/Statement of Business Intent 19

Capital Delivery 16

Capital Program 10, 11, 20

Chairperson Report 4

Charter 2

Consultants 18

Contents 1


Customer Satisfaction 9

Disability Inclusion Plan 17

Eco Village 10

Employee Assistance Program 17

Equal Employment Opportunity 16

Field Trips 8




Flexible Accommodation 10


Government Property Register 17

Hazardous Materials 10

Heritage Assets 11

Housing Allocated 7

Housing Demand 8

Human Resources 16

Independent Auditors Report 32, 33

Industrial Relations 16

Information and Communications Technology 18

Insurance 17, 21

Internal Audit and Risk Management 18, 23

Internal Audit Plan 18


Pages

Key Performance Indicators 12, 15


Land Purchases 10

Loan Facility 12

Local Housing Representatives 7

Maintenance 11

Managing Agents 7


Multicultural Policies and Services Program 16

Notes 38

NSW Digital Information Security Policy, Compliance Attestation Statement 2015–16 19

NSW Public Sector Workforce Profile 17


Organisational Structure 16, 22

Other Activities 17

Overseas Travel 19


Principal Roles 16

Privacy and Personal Information Protection Act 1998 (PPIP Act) 17

Project Management 11

Property and Occupancy Data 15

Public Access to Government Information 17

Public Interest Disclosures (PID’s) 18

Public Sector Reforms and Legislative Changes 19

Related Entity 6

Rents 7

Rental subsidy 7

Review of Government Employee Accommodation 19

School Residences 11

Staffing Arrangement 16

Staffing Numbers 16, 21, 22

Stakeholders 16, 28

Statement by Members 31

Strategic Asset Management Plan 10


Vacancy/Occupancy Rate 8

Weekly Rental Amounts (applied from 1 May*) 15

Welcome Kit – Tenant Handbook 8

Workplace Health and Safety (WHS) 17

57


Access to ServicesStreet AddressMcKell Building Level 18, 2–24 Rawson Place Sydney NSW 2000

Postal AddressLocked Bag 7 Haymarket NSW 1240

Key Telephone NumbersSwitchboard (02) 8276 8000

Toll Free 1300 137 343

General Manager (02) 8276 8001

Finance Manager (02) 8276 8020

Financial Accountant (02) 8276 8022

Executive Officer (02) 8276 8004

Manager Tenancy Services (02) 8276 8011

Asset Manager (02) 8276 8030

Communications Project Officer (02) 8276 8003

Tenancy Service AreasNorthern NSW & Illawarra (02) 8276 8014

Riverina (02) 8276 8013

Central Western (02) 8276 8015

North Western (Bourke/Orange) (02) 8276 8012

Building Services (Assets)Technical Officer (North) (02) 8276 8031

Technical Officer (South) (02) 8276 8032

Contracts Administration Officer (02) 8276 8033

Maintenance Officer (responsive) (02) 8276 8034

General InquiriesEmail: [email protected]

Website: www.tha.nsw.gov.au

Business HoursMonday to Friday 8.30 am – 4.30 pm

This report is also available on the internet at www.tha.nsw.gov.au/about/annualreport.cfm

TEACHER HOUSING AUTHORITY OF NEW SOUTH WALES

Level 18, 2–24 Rawson Place, Sydney, NSW 2000 Haymarket Post Shop, Locked Bag 7, Haymarket, NSW 1240

www.tha.nsw.gov.au


245TEACHER HOUSING AUTHORITY OF NEW SOUTH WALES

Level 18, 2–24 Rawson Place, Sydney, NSW 2000 Haymarket Post Shop, Locked Bag 7, Haymarket, NSW 1240

www.tha.nsw.gov.au

This page intentionally left blank


246

AAccess back coverAfter balance date 5Agreements with Multicultural NSW 90, 158Aims and objectives 78, 132

BBudgets 29

CConsultants 84, 144Consumer response 83, 142Credit card certification 84, 144

DDigital information security policy attestation 89, 158Disability Inclusion Action Plans 82, 141Disclosure of controlled entities 90, 152Disclosure of subsidiaries 90, 158

EExemptions 90, 158External costs back cover

FFinancial statements 38, 93, 159Funds granted to non-government community organisations 90, 137

GGovernment Information (Public Access) Act 89, 147

HHuman resources 79, 138

IImplementation of price determination 90, 158Internal audit and risk management policy attestation 87, 154, 156Investment performance 90, 158

LLand disposal 90, 158Legal change 79, 138Letter of submission Inside cover, 92Liability management performance 90, 158

Index

Note: This index covers information for Property NSW’s Annual Review, as well as GPNSW and SHFA’s statutory information. Refer to Appendix C for THA’s index (page 56 of their Annual Report).


247

MManagement and activities 2–23Management and structure 5, 20, 78, 134Multicultural Policies and Services Program 82, 140

NNumbers and remuneration of senior executives 80, 139

PPayment of accounts (including time for payment) 85, 145Privacy and Personal Information Protection Act 88, 147Promotion 83, 158Public Interest Disclosures 88, 147

RRequirements arising from employment arrangements 79, 138Research and development 90, 158Risk management and insurance activities 86, 152

SSummary review of operations 2–33

TTeacher Housing Authority Annual Report 2015/16 183

WWebsites 34, back coverWork Health and Safety 82, 142Workforce diversity 80, 139

Property NSWBligh House, Level 3, 4–6 Bligh Street, Sydney NSW 2000GPO Box 4081, Sydney NSW 2001T: 02 9273 3800

Level 6, 66 Harrington Street, The Rocks NSW 2000PO Box N408, Grosvenor Place NSW 1220T: 02 9240 8500www.property.nsw.gov.au

Teacher Housing Authority NSW McKell Building, Level 18, 2–24 Rawson Place, Sydney NSW 2000Locked Bag 7, Haymarket NSW 1240T: 02 9260 2000www.tha.nsw.gov.au

Waste Assets Management CorporationLevel 2, 10 Valentine Avenue, Parramatta NSW 2150PO Box 3366, Parramatta NSW 2124T: 02 9685 4960www.finance.nsw.gov.au/waste-assets-management-corporation

Valuation Services1 Prince Albert Road, Queens Square, Sydney NSW 2001PO Box 745, Bathurst NSW 2795T: 1800 110 038www.valuergeneral.nsw.gov.au

Public Works AdvisoryMcKell Building, 2–24 Rawson Place, Sydney NSW 2000T: 02 9372 8877 www.publicworksadvisory.nsw.gov.au

Annual Review and Annual Reports costsThe 2015/16 Property NSW Annual Review and associated Annual Reports are produced in electronic format and are available to download from www.property.nsw.gov.au.

The reports were written, designed and produced in-house at no cost to Property NSW.

Annual Review 2015–16 - Property NSW · 2016-12-01 · Property NSW Annual Review 2015–16 Dear...

Documents

Transcript of Annual Review 2015–16 - Property NSW · 2016-12-01 · Property NSW Annual Review 2015–16 Dear...