Statement by the Statutory Trustee - Web viewThe financial statements for the year ended 31 December...

TECHNICAL EDUCATION TRUST FUNDS

Audited Financial Statements

Table of Contents

Statement by the Statutory Trustee..............................................................................2

Statement of Comprehensive Income..........................................................................3

Statement of Financial Position....................................................................................4

Statement of Changes in Equity...................................................................................5

Statement of Cash Flows.............................................................................................6

Notes to and forming part of the Financial Statements.................................................7

1. Summary of significant accounting policies..............................................................7

2. Revenue and expenses............................................................................................2

3. Cash and cash equivalents......................................................................................3

4. Receivables..............................................................................................................3

5. Other financial assets...............................................................................................3

6. Payables...................................................................................................................4

7. Accumulated funds for each Trust Fund at the end of the reporting period..............4

8. Reconciliation of cash flows.....................................................................................5

9. Commitments...........................................................................................................5

10. Contingent liabilities................................................................................................5

11. Financial instruments..............................................................................................5

12. Events after the reporting period............................................................................8

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Start of Audited Financial Statements


Statement by the Statutory Trustee

For the year ended 31 December 2016

Pursuant to Section 41C of the Public Finance and Audit Act 1983 and Section 7 of the Public Finance and Audit Regulation 2015, I state that in my opinion:

1. the accompanying financial statements exhibit a true and fair view of the financial position of the Technical Education Trust Funds as at 31 December 2016 and the financial performance for the year then ended.

2. the 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, the Treasurer's Directions and applicable Australian Accounting Standards and Interpretations.

At the date of signing this statement, I am not aware of any circumstances which would render any particulars included in the financial statements misleading or inaccurate.

Jon BlackStatutory Trustee

Date: 19 April 2017

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Statement of Comprehensive Income For the year ended 31 December 2016

Notes 2016$

2015$

Revenue 2(a) 17,176 20,240

Total revenue 17,176 20,240

Expenses 2(b) 13,650 15,315

Total expenses 13,650 15,315

Net result 3,526 4,925Other Comprehensive Income - -Total other comprehensive income - -

Total Comprehensive Income 3,526 4,925

The accompanying notes form part of these financial statements.

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Statement of Financial Position as at 31 December 2016

Notes 2016$

2015$

ASSETSCurrent Assets

Cash and cash equivalents 3 52,705 47,729Receivables 4 4,724 6,106Other financial assets 5 164,574 164,574

Total Current Assets 2220032,003

218,409

Non-current Assets

Other financial assets 5 286,150 286,150

Total Non-current Assets 286,150 286,150

TOTAL ASSETS508,153 504,559

LIABILITIESCurrent Liabilities

Payables 6 101 33Total Current Liabilities 101 33

TOTAL LIABILITIES 101 33

NET ASSETS 508,052 504,526

EQUITY

Accumulated funds 7 508,052 504,526

TOTAL EQUITY 508,052 504,526


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Statement of Changes in Equity for the year ended 31 December 2016

Accumulated Funds

$

Total$

Balance at 1 January 2016 504,526 504,526

Net result for the year 3,526 3,526

Other comprehensive income - -

Total other comprehensive income - -

Total comprehensive income for the year 3,526 3,526

Balance at 31 December 2016 508,052 508,052

Balance at 1 January 2015 499,601 499,601

Net result for the year 4,925 4,925

Other comprehensive income - -

Total other comprehensive income - -

Total comprehensive income for the year 4,925 4,925

Balance at 31 December 2015 504,526 504,526


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Statement of Cash Flows for the year ended 31 December 2016

Notes 2016$

2015$

Cash Flows from Operating ActivitiesPayments

Prize awardsOther

(13,496)(102)

(15,316)(33)

Total payments (13,598) (15,349)

ReceiptsInterest received 17,904 20,832Other 671 234

Total receipts 18,574 21,066

Net Cash Flows from Operating Activities8 4,976 5,717

Cash Flows from Investing Activities

Other - -

Net Cash Flows from Investing Activities - -

Net Increase in Cash 4,976 5,717

Opening cash and cash equivalents 47,729 42,012

Closing cash and cash equivalents 3 52,705 47,729


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Notes to and forming part of the Financial StatementsFor the year ended 31 December 2016

1. Summary of significant accounting policies(a) Reporting entity

The Technical Education Trust Funds (the Entity) is a New South Wales government entity. The Entity is a not-for-profit entity (as profit is not its principal objective) and it has no cash generating units.

The financial statements for the year ended 31 December 2016 were authorised for issue by the Statutory Trustee on 19 April 2016.

(b) Basis of preparation

The financial statements are general purpose financial statements which have been prepared on an accrual basis in accordance with:

Applicable Australian Accounting Standards (which include Australian Accounting Interpretations);

The requirements of the Public Finance and Audit Act 1983 and the Public Finance and Audit Regulation 2015; and

The Financial Reporting Directions published in the Financial Reporting Code for NSW General Government Sector Entities or issued by the Treasurer.

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

All amounts are rounded to the nearest dollar and are expressed in Australian currency.

(c) Statement of compliance

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

(d) Statutory Reporting Period

In terms of Section 4(1A) of the Public Finance and Audit Act 1983, the Treasurer has determined that the financial year of the Entity ends on 31 December.

(e) Income Recognition

Income is measured at the fair value of the consideration or contribution received or receivable.

(i) Investment Revenue

Interest revenue is recognised using the effective interest method as set out in AASB 139 Financial Instruments: Recognition and Measurement.

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Notes to the financial statements For the year ended 31 December 2016

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:

The amount of GST incurred by the Entity as a purchaser that is not recoverable frm the Australian Taxation Office (ATO) is recognised as part of the cost of acquisition of an asset or as part of an item of expense

Receivables and payables are stated with the amount of GST included.

Cash flows are included in the statement of cash flows on a gross basis. However, the GST components of cash flows arising from investing which are recoverable from, or payable to, the ATO are classified as operating cash flows.

(g) Cash and cash equivalents

Cash and cash equivalents is cash held at bank.

(h) Receivables

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 determination of Total Comprehensive Income for the year when impaired, derecognised or through the amortisation process. There was no change due to impairment, de-recognition 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.

(i) Other financial assets

Other financial assets are investments that are non-derivative financial assets with fixed or determinable payments and fixed maturity that the Entity has positive intention and ability to hold to maturity. These investments are measured at amortised cost using the effective interest method. These assets represent common trust funds for the moneys entrusted to the Statutory Trustee in accordance with section 8 of the Technical Education Trust Funds Act 1967 (the Act). Interest payments are received for each term deposit every six months and are allocated proportionately according to the amount contributed by each fund to the common trust fund, as required by the Act.

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(j) Payables

Payables represent liabilities for goods and services provided and other amounts. 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.

(k) Equity and reserves

The category 'Accumulated Funds' includes all current and prior period retained funds.

(l) Comparative information

Except 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.

(m) Changes in accounting policy, including new or revised Australian Accounting Standards:

i. Effective for the first time in 2016

The accounting policies applied in 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 2016. The impact of these standards in the period of initial application includes:

AASB 2015-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101 [AASB 7, AASB 101, AASB 134 & AASB 1049] AASB 2015-2 amends AASB 101 Presentation of Financial Statements based on the IASB’s Disclosure Initiative project. The amendments are designed to encourage entities to apply professional judgement on disclosures. The amendments also clarify that entities should use professional judgement in determining the location and order of information disclosed.

AASB 2015-3 regarding withdrawal of AASB 1031 MaterialityThis Standard completes the withdrawal of references to AASB 1031 in all Australian Accounting Standards and Interpretations, allowing AASB 1031 to effectively be withdrawn. This change has been assessed by the Entity and there is no material impact.

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ii. Issued but not yet effective

NSW public sector entities are not permitted to early adopt new Australian Accounting Standards, unless Treasury determines otherwise.

The following new Accounting Standards issued but not yet effective for the financial year ended 31 December 2016 are not early adopted and would not be expected to have a material impact on the financial statements of the Entity.

AASB 9 Financial Instruments AASB 2014-7 Amendments to Australian Accounting Standards

arising from AASB 9 (December 2014) AASB 2015-6 Amendments to Australian Accounting Standards –

Extending Related Party Disclosures to Not-for-Profit Public Sector Entities

AASB 2016-2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 107

(n) Common Trust Fund

Pursuant to Section 8 of the Act, the Statutory Trustee has established a common fund for moneys held on behalf of each contributing Fund. Records are kept of each contributing funds’ share of the common fund.

(o) Trust Funds Assets

Apart from funds invested as fixed term deposits, the Entity held no fixed assets, nor owned or occupied land as at 31 December 2016.

(p) Entity Financial Records

Accounting and other records for the Entity were maintained by the NSW TAFE Commission (the Commission) on behalf of the Statutory Trustee. All administration costs, including salary and wages, were met by the Commission. The Commission does not charge for these costs. The Treasurer of NSW has approved the waiving of audit fees for the Entity.

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2. Revenue and expenses

2016$

2015$

a. RevenueInterest revenue 2(c) 16,509 20,240Other 667 -

Total revenue 17,176 20,240

b. ExpensesPrize awards 2(c) 13,479 15,282Other expenses 2(c) 171 33

Total expenses 13650 15,315

c. The revenue and expenses are attributed to individual funds as follows:Trust Fund 2016

Income$

2016 Expend-

iture$

2016 Income

2015 Expend-

iture$

Barrington Raymund Roberts Memorial 3,281 2,310 4,416 3,213

Coachbuilders 1914-1919 War Memorial Bursary 756 13 1,007 4

Institute of Mechanical Engineering Craftsmen Prize 813 - 191 -

J. P. Franki Memorial - - 24 881

Mary Ellen Roberts Memorial 306 235 412 330

Noel Chettle Memorial Art Prize 1,311 961 1,737 1,303

TAFE Bicentenary Oliver Shaul Scholarship 10,149 7,689 11,707 9,012

William and Elizabeth Cuthbertson Memorial 560 2,442 746 572

17,176 13,650 20,240 15,315

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3. Cash and cash equivalents

2016

$

2015

$Cash at bank 52,705 47,729Closing Cash at Bank (per Statement of Cash Flows) 2,705 47,729

4. Receivables2016

$

2015

$

Interest receivables 4,512 6,106Other debtors 212 -Total Receivables 472447244 6,106

Details regarding credit risk, liquidity risk and market risk including financial assets that are either past due or impaired are disclosed in Note 11.

5. Other financial assets 2016

$

2015

$

Current assets 164,574 164,574Non-current assets 286,150 286,150

450,724 450,724

The market value of the investments was not less than the face value.

Details regarding credit risk, liquidity risk and market risk, including a maturity analysis of the above payables are disclosed in Note 11.

Note: the amount of $450,724 ($450,724 in 2015) above is part of total fixed term deposits of $561,462 ($561,462 in 2015) with remaining represented funds held on behalf of TAFE Commission of $110,738 ($110,738 in 2015).

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6. Payables

2016$

2015$

Accrued expense 101 33Total Payables 101 33

Details regarding credit risk, liquidity risk and market risk, including a maturity analysis of the above payables are disclosed in Note 11.

7. Accumulated funds for each Trust Fund at the end of the reporting period

Trust Fund 2016 Fund Balance

$

2015 Fund Balance

$

Barrington Raymund Roberts Memorial 109,807 108,836Coachbuilders 1914-1919 War Memorial Bursary 27,615 26,872Institute of Mechanical Engineering Craftsmen Prize1 - (813)J. P. Franki Memorial 17 17Mary Ellen Roberts Memorial 9,202 9,131Noel Chettle Memorial Art Prize 42,747 42,397TAFE Bicentenary Oliver Shaul Scholarship 301,561 299,101William and Elizabeth Cuthbertson Memorial 17,103 18,985

508,052 504,526

Notes1. In 2015, the Institute of Mechanical Engineering Craftsmen went into an accumulated funds

deficit. The deficit was reversed in 2016 via a funds transfer from the TAFE Commission.

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8. Reconciliation of cash flowsfrom Operating Activities to the Net Result

2016$

2015$

Net cash used on operating activities 4,976 5,717(Decrease) in Receivables (1,381) (792)Decrease in Payables (69) -Net Result 35266 4,925

9. CommitmentsAs at balance date, there are nil commitments.

10. Contingent liabilitiesAs at balance date, there are nil contingent liabilities.

11. Financial instruments The principal financial instruments of the Entity are outlined below. These financial instruments arise directly from the Entity’s operations or are required to finance the Entity’s operations. The Entity does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes. The Entity does not use financial derivatives.

The Entity’s main risk arising from financial instruments are outlined below, together with the Entity’s objectives, policies and processes for measuring and managing risk.

The Statutory Trustee 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 Entity, to set risk limits and controls and to monitor risks. Compliance with policies is reviewed by the Audit and Risk Committee on a regular basis.

Financial instruments give rise to positions that are a financial asset of the Entity and a financial liability of another party. For the Entity these include cash and other financial assets. All financial instruments are shown at net fair value unless stated otherwise.

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11. Financial Instruments (continued)

(a) Financial instruments categories

Financial Assets Class:

Notes Category Carrying Amount

2016$

Carrying Amount

2015$

Cash and cash equivalents1

3 N/A 52,705 47,729

Receivables24 Receivables (at

amortised cost)4,724 6,106

Other financial assets3

5 Loans and receivables (at amortised cost)

450,724 450,724

Financial

Liabilities

Class: Payables4 6 Financial liabilities

measured (at amortised cost)

101 33

Notes1. Cash and cash equivalents comprise of bank balance held with the Treasury Banking

System. Interest is earned on daily bank balance at Corporate Cheque Account rate.2. Excludes statutory receivables and prepayments (i.e. not within scope of AASB 7).3. These are term deposits with banks maturing within 5 years and paying interest rates

between 2.35% and 3.95% per annum (2.45% to 6.60% in 2015). Total term deposits are $561,462 ($561,462 in 2015). Trust proportion $450,724 ($450,724 in 2015).

4. Excludes statutory payables and unearned revenue (i.e. not within scope of AASB 7).

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(b) Credit riskCredit risk arises when there is the possibility of the Entity’s debtors defaulting on their contractual obligations, resulting in financial loss to the Entity. The maximum exposure to credit risk is generally represented by the carrying amount of the financial assets.

Credit risk arises from the financial assets of the Entity, including cash, receivables and term deposits. No collateral is held by the Entity. The Entity has not granted any financial guarantees.

Credit risk associated with the Entity’s financial assets, other than receivables, is managed through selection of counterparties and establishment of minimum credit rating standards.

Impact of credit risk to the Entity is minimal.

(c) Liquidity riskLiquidity risk is the risk that the Entity will be unable to meet its payment obligations when they fall due. The Entity 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.

Exposure to Liquidity risk is considered minimal.

Maturity analysis and interest rate exposure of financial assets

Interest Rate Exposure

Weighted average

Effective Int. Rate

Nominal Amount a $

Fixed Interest Rate

$

Variable Interest Rate

$Non-interest

bearing $2016Other financial assets: Term deposit 3.66% 450,724 450,724 - -2015Other financial assets: Term deposit: 4.48% 450,724 450,724 - -

Maturity dates < 1 yr$

1 -5 yrs$

> 5 yrs$

2016Other financial assets: Term deposit 164,574 286,150 -2015Other financial assets: Term deposit: 164,574 286,150 -

Notes: 1. The amounts disclosed are the contractual undiscounted cash flows of financial assets.

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(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 Entity has no exposure to other price risk.

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. 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 cash at bank. All the other financial assets held are subject to fixed interest rates. The weighted effective interest on this is 3.66% p.a. (4.48% p.a. 2015). Interest on the bank balance is subject to fluctuations in market rates. All other financial assets are not subject to interest rate risk as they are non-interest bearing. Impact of interest rate risk to the Entity is minimal.

Carrying Amount

-1%Profit$'000

-1% Equity$'000

+1% Profit$’000

+1% Equity$'000

2016Financial assets Cash and cash equivalents 52,705 (527) - 527 -

2015Financial assets Cash and cash equivalents 47,729 (477) - 477 -

12. Events after the reporting period There are no events after the reporting period which affect the financial statements.

End of Audited Financial Statements

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Statement by the Statutory Trustee - Web viewThe financial statements for the year ended 31 December...

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