2007/2008 Annual Report

Transcription

Branches
Launceston
Cnr York & George Sts
(03) 6335 5633
Burnie
24 North Terrace
(03) 6434 2933
Rosny Park
Rosny Mall,
2 Bayfield St
(03) 6244 7755
Glenorchy
Cnr Main Rd
& Terry St
(03) 6273 1888
Kingston
Shop 49A
Channel Court
(03) 6229 8299
Solutions
Devonport
119 Rooke St Mall
(03) 6421 1933
07 08
The Royal Automobile Club of Tasmania Limited
Annual Report
2007 08
Patron
Registered Head Office
His Excellency, The Honourable P.G. Underwood AO
Governor of Tasmania
Cnr Murray and Patrick Streets,
Hobart, Tasmania, 7000
President
Postal Address
Ted Best AM (to 30/10/2007)
Roger Locke (from 30/10/2007)
GPO Box 1292, Hobart, Tasmania, 7001
Vice Presidents
Telephone: Facsimile:
Email address:
Internet site:
Stuart Slade
Peter Joyce (from 01/02/2008)
Board
Josephine Archer
Ted Best AM
John Bloomfield (to 30/10/2007)
David Catchpole
Bruce Clark (from 26/03/2008)
Peter Dixon (from 31/07/2007)
Robin Holmes
Chris Langdon
Tony Stacey AM
Kathryn Westwood
Honorary Life Members
David Catchpole
Trevor Challen, OAM
Denis Nation
Clive Sherry
Tony Stacey AM
Jean Trethewey OAM
Contact Details
(03) 6232 6300
(03) 6234 8784
info@ract.com.au
www.ract.com.au
President’s Report
2
Group Chief
Executive’s Report
4
The Year in Detail
7
Branches
Directors’ Report
16
Hobart (Murray Street); Hobart (Collins Street);
Launceston; Devonport; Ulverstone, Burnie;
Rosny Park; Glenorchy; Kingston.
Auditor’s Independence
Solicitors
Performance
Butler McIntyre and Butler
20 Murray Street
Statement of Financial
Auditors
in Equity
Wise Lord & Ferguson
160 Collins Street
Cash Flow Statement 24
Bankers
Statements
ANZ Banking Group Limited
40 Elizabeth Mall
Directors’ Declaration 55
Declaration
20
Statement of Financial
21
Position
22
Statement of Changes
23
Notes To and Forming
Part of the Financial
Regional Advisory Committees
Senior Management
North: Peter Dixon (Chairman); Josephine Archer; Ron Bessell;
Bruce Doolan; Alana Fazackerley; Kerry Holloway; Colin Moore;
Gary O’Keefe; Robert Panitzki; Russell Reid; Craig Petterwood
(Secretary).
Group Chief Executive: Greg Goodman
North West: Bill Enkelaar (Chairman); John Bloomfield; Bruce
Clark; Ian Day; Kay Kidd; Rodney Medwin; Dale Prosser; Joe
Rattray; Robert Sharp (from 27/11/2007); Michael Dixon
(Secretary).
General Manager, Sales & Distribution: Craig Petterwood
South: Stuart Slade (Chairman); Ian Holloway ESM; Phillip
Jones; Bill Lawson AM; Jim Nicholson; Neil Noye AM; Betty
Parssey; David Paton APM; Vince Taskunas (Secretary).
Contents
25
Independent
Auditor’s Report
56
Chief Operating Officer: Harvey Lennon
Chief Financial Officer: Judith Dew
Chief Information Officer: Iain Kelly
General Manager, Public Policy and Communications:
Vince Taskunas
General Manager, Roadside and Technical Services:
Darren Moody
General Manager, Travel: Robyn Sinfield
Human Resources/Compliance Manager: Lyndell Shephard
RACT Annual Report 07–08
1
President’s Report
“ ”
The success of a service organisation, of course, depends
almost entirely on its commitment to service and the efforts
of management and staff in this direction during the year have
played a most significant role in the RACT’s year-end outcome,
despite the adverse economic conditions.
The RACT is the largest and strongest community service
organisation in Tasmania and I was very proud to take on the
position of President, following in the footsteps of my Board
colleague, Ted Best AM, who stepped down from the role
this year.
As a long serving member of the Board, I have seen the steady
growth of the RACT over the last decade in good economic
climates and bad. This year, a period of strong global economic
growth has been tested by a waning US economy that in part
has led to poor investment returns. Despite this, the RACT has
enjoyed a financially strong 2007/2008 and ends the year in
a sound position.
Our cover:
Three sides of the RACT cube
reflect the three strands of
our services to members
and customers –
ROADSIDE assistance,
travel and insurance.
Representing their business units are
Helen Coleman (RACT Travelworld);
Josh Dobie (ROADSIDE patroller)
and Jennifer Mackeprang
(RACT Insurance).
2
go to John for his tremendous commitment to the RACT
and its ideals.
During the year, Peter Dixon was appointed to a casual vacancy
on the Board following the resignation of long serving Director,
Bruce Doolan. Mr Dixon, of Launceston, is Associate Dean,
The success of a service organisation, of course, depends
almost entirely on its commitment to service and the efforts
of management and staff in this direction during the year have
played a most significant role in the RACT’s year-end outcome,
despite the adverse economic conditions.
(Teaching & Learning) and Lecturer in Management within
The RACT maintains constant audits of its service levels and
this year saw exceptional outcomes. Good service translates
into high levels of loyalty and this was amply illustrated with
three 50-year membership functions, in Hobart, Burnie and
Launceston. The Hobart function was the largest with some
230 Tasmanians coming together to celebrate 50 years as
members of the RACT. Amongst those who had attained
50-year membership status was former President of the
Legislative Council, Ken Lowrie; a former President of the
RACT, Clive Sherry; the former CEO of the RACT, Denis Nation;
and the ABC’s Ken Short.
for 17 years and I wish to record here my appreciation of his
At Board level, this year saw a number of developments that
deserve mention.
a national policy on greener motoring.
John Bloomfield retired after a very active life of contribution
to the RACT’s Board and was replaced by another North West
Coaster, retired businessman Bruce Clark. The RACT’s thanks
sectors of the community to play their part in reducing emissions
the Faculty of Business at the University of Tasmania.
His extensive legal and business background complements and
enhances the professional skills that are currently represented
on the Board. Mr Doolan served on the Board of the RACT
counsel and experience.
During the year, the RACT worked closely with Australia’s
other motoring clubs and through the Australian Automobile
Association (AAA) to advance the agenda on behalf of our
motoring constituency.
The Federal Election of 2007 highlighted growing concern about
climate change and, in the lead up to the election, and following
it, this was a major issue for the motoring clubs. As a group
representing 6.5 million motorists, we decided to develop
We recognised that the climate change challenge requires all
and the motor clubs’ policy, which was finally adopted, took into
account the impact of motoring on emissions while also ensuring
2007 08
maximum mobility was maintained and that motorists were also
educated to environmentally friendlier ways of driving.
The RACT also maintains membership of the state committee
The policy was launched in Canberra and a national climate
change summit was held in June, which I attended on behalf
of the RACT. As part of our position on climate change, the
clubs supported the introduction of emissions trading which
would see motorists reducing their vehicle emissions through a
market-based carbon-trading scheme. We were opposed to a
government tax regime and were very pleased when the new
Rudd Government announced it would proceed with a marketbased trading scheme.
funding program and the RACT is represented on the State
The relationship between the RACT and other motoring clubs
has been growing steadily stronger in recent years and climate
change was a particular issue where we worked very closely
together and with the AAA to ensure the best outcome for
our members. The AAA is the motoring clubs’ secretariat in
Canberra and is funded by all the motoring clubs. Currently,
the President of the AAA is Alan Evans, a former Tasmanian,
while the Chief Executive is another Tasmanian, Mike Harris,
whose late father, Mr Lin Harris, was a board member of the
RACT for nine years.
communications, the RACT enjoys a strong reputation
As well as its focus on national issues, the RACT continued to
work closely this year with the Tasmanian Government. Regular
meetings are held at CEO level and at senior managerial level,
between the RACT and DIER, to discuss issues of concern such
as infrastructure funding and road safety.
that advises the Federal Government on its Black Spot
Government’s peak Road Safety Council and the Road Safety
Task Force.
Within the three regions of Tasmania, the RACT also maintains
advisory committees that offer input on important local road
funding and road safety issues which can then form part of the
RACT’s extensive consultative and communications programs.
Through this commitment to liaison, consultation and
as an independent authority and voice of its members.
My thanks go to our many partners such as our agents,
contractors and our three regional advisory committees.
Their enthusiasm for the RACT and their support of its values
helps make the organisation the respected household name
it is today.
Finally, I wish to acknowledge the hard work of the RACT Board
in its guidance and oversight of the RACT, the Executive team
led by Greg Goodman, and all the staff at the RACT for the result
we have enjoyed this year.
Roger Locke
Southern Regional Committee
Three eras of RACT service took
the stage at our 50-year
membership function at
Wrest Point earlier in the year.
Across Tasmania, we honoured
almost 500 loyal members for their
half-century of membership of
the Club.
The RACT’s Regional Advisory Committees meet regularly to discuss and recommend action on their region’s road safety and road infrastructure issues.
Pictured is our Southern Regional Advisory Committee: Front, from left: Ian Holloway, Betty Parssey, RACT Vice-President Stuart Slade (Chairman),
Philip Jones. Back: RACT General Manager Public Policy and Communications Vince Taskunas (Secretary), David Paton APM, Jim Nicholson,
Neil Noye AM, Bill Lawson AM.
3
Group Chief Executive’s Report
“ ”
Because RACT Insurance is local, with local expertise and local
management, it was able to respond to April’s storm very effectively
and enhanced its reputation in the community by the way it
expeditiously handled the flood of claims that occurred after
the storm.
This financial year will be remembered as the year the
international economy ‘caught the flu’. The US sub-prime
mortgage crisis triggered a decline in confidence in most
developed economies, a tightening in the investment climate
and poor returns on investments.
Despite these global uncertainties, the RACT has enjoyed a
good year, achieving an operating surplus of $1.4 million.
As the President has reflected, much of this can be attributed
to our hard working staff who, this year, provided the highest
levels of measured customer service since I have been CEO.
This has been reflected not just in customer satisfaction rates but
also in membership growth. During the year, RACT ROADSIDE
membership grew by 2.2% which is a most commendable
result and reflects on the value which Tasmanians place in the
RACT and its services at a time when consumers are tightening
their belts.
Our membership growth included a healthy 8.7% increase in
our premium Ultimate membership which again demonstrates
the value that Tasmanians place on this cover.
A highlight during the year was the
opening of our new Rosny branch,
further proof of our belief that a
strong and responsive statewide
branch network is an important
feature of RACT’s service to our
members.
Our three core activities are ROADSIDE Assistance, Insurance
and Travel and, besides the solid growth path in membership
at the RACT, I am pleased to be able to look back on a year
of growth in both Travel and Insurance.
RACT Insurance experienced an increase in gross written
premium. Its market share continued to build, consolidating
its position as the leading insurer in Tasmania in motor and
home insurance.
The result came in a year that saw, once again, some major
weather events. A storm in April, described as ‘hurricane-like’,
caused very extensive damage in southern Tasmania. RACT
Insurance received 1300 claims for damage totalling just over
$2 million. This eclipsed its previous record of
$1.75 million in claims due to storms in February 2005.
4
Because RACT Insurance is local, with local expertise and
local management, it was able to respond to April’s storm very
effectively and enhanced its reputation in the community by the
way it expeditiously handled the flood of claims that occurred
after the storm.
RACT Travelworld achieved an increase in revenues this year.
In line with our strategic planning, with an emphasis on
international travel and holidays, 72% of sales at RACT Travelworld
were for overseas travel, compared to 28% for domestic travel.
The travel business has been working hard on its structure and
business offering and this groundwork is now being reflected in
the bottom line.
It has also been a year that has seen major investment in
business so that we can better serve our members.
Highlights include:
• $350,000 spent on upgrading branches at Rosny, Kingston
and Ulverstone
• The purchase of two new tow trucks ($160,000)
• $200,000 to date on a new computer aided despatch
(CAD) system to be fully implemented by November 2008.
The RACT also upgraded its ROADSIDE patrol fleet.
Two patrol vans were replaced with diesel vehicles, to
support the RACT’s policy of reducing its greenhouse footprint.
On the technology front, we introduced an SMS messaging
service for ROADSIDE and RACT Insurance users to remind
them when membership and policies were about to expire.
2007 08
The RACT Insurance team responded promptly and effectively in the aftermath of April’s damaging storms, handling a flood of more than 1300 claims.
We are very cautious about using such technology in a way
which may be intrusive, but the feedback we have received
has been excellent.
His retirement ushered in a minor restructuring of senior
Free winter car safety checks were again undertaken in Hobart
and Launceston as a community service, underlining our
commitment to supporting Tasmanians. As I report each year,
the RACT was again very active in sponsorship of community
undertakings and events right across the State in 2007/2008.
The free winter car checks were a major undertaking by the Club,
but they illustrate our active engagement in the community.
As well, we supported many events and programs around the
state in response to approaches from organisations seeking
our assistance.
Communications, and Darren Moody, who had served under Mr
Our commitment to working in the community extends to our
branch network. The nine branch offices the RACT maintains
around the State provide a convenient walk-in facility for people
to transact business with the RACT, if they prefer face-to-face
dealings, rather than transacting business by the phone or
the internet.
A new oil shock took petrol prices to as high as $1.60 per litre
The branch offices give the RACT a very visible profile in local
communities. It is worth noting that some of our senior managers
are also located in centres outside Hobart, and bring to the
organization a truly statewide perspective. Robyn Sinfield, who
heads RACT Travelworld is headquartered in Ulverstone, and
Craig Petterwood, our General Manager Sales & Distribution,
is located in Launceston.
petrol prices has been to encourage the maximum amount
I should record at this point some senior changes at the RACT
over the course of the year. Our long serving Chief Engineer, Doug
Ling, retired from the RACT after many years of distinguished
service to both our club and the motoring community of Tasmania.
Mr Ling left the RACT with our thanks for his fine work, and our
best wishes for the future.
a leadership stance on this fast-developing issue for three
management roles. Mr Vince Taskunas was appointed to
the new position of General Manager, Public Policy and
Ling, became General Manager, Roadside & Technical Services.
Both these positions strengthen our efforts in our
communications. The year again saw the RACT heavily involved
in initiatives, and comment, on issues affecting road safety,
motoring in general, and transport infrastructure.
The three biggest issues, among many, this year were
undoubtedly petrol prices, climate change, and federal funding
for Tasmanian transport infrastructure.
by the end of the financial year. The RACT maintained its weekly
monitoring of petrol prices in Tasmania and posted the results
each Thursday on its website. I also gave evidence to an inquiry
into petrol prices by the Australian Competition and Consumer
Commission. Our own strategy throughout this period of soaring
Inspired
by
India
Robyn Sinfield
India is confronting – but it’s an
experience for all the senses,
with an ever-present barrage
of unusual scenes and
unpredictable experiences.
36
August / September 08
RACT Travelworld again
increased its international business
during the year, using our bi-monthly
magazine Motor News as a key
promotional tool.
of local competition in prices and provide transparency so
that motorists can make a choice when it comes to
purchasing petrol.
During the year, climate change emerged as a key Federal
Election issue. The motoring clubs were determined to take
reasons: to ensure motorists weren’t unfairly penalised by any
emissions trading scheme; to ensure that each club played its
part to minimise its environmental footprint; and to put in place
awareness and educational programs to help motorists reduce
their own carbon footprint.
5
Group Chief Executive’s Report
This plan came together through intensive consultation
and liaison among the clubs at numerous meetings.
performing Tasmanian entity. Its financial position is robust,
The RACT also enjoyed a successful year in lobbying for
transport infrastructure funds for Tasmania in the lead up to the
Federal Election. We liaised closely with the State Government,
the federal Liberals and the federal ALP, and both major parties
committed to Tasmanian projects in line with the priorities we
had outlined to them.
peaks of professionalism in membership services.
So at the end of the year, in an economic climate which is more
uncertain than for many years, the RACT remains a strongly
RACT continued to focus our
advocacy efforts on motoring and
road safety issues affecting our
members, particularly the problem
of fast-rising petrol prices.
6
it enjoys a strong asset base, and its staff are reaching new
My thanks to RACT staff – and our wider family, such as
our ROADSIDE agents, Approved Repairers and Selected
Insurance Repairers, for their commitment to the RACT
and its values over the last 12 months.
Greg Goodman
RACT Chairman Roger Locke presents Burnie member Alan Braid with a plaque acknowledging his 50 years of RACT membership.
The Year in Detail
2007 08
Looking back over the year, our club magazine Motor News has published numerous new vehicle reviews and road tests, including extensive coverage
of the prestigious Australia’s Best Cars awards.
Corporate Governance
The Board of the RACT is responsible for the management and
control of the affairs of the organisation in accordance with the
Club’s Constitution, statutory and compliance obligations.
In particular, the Board:
• Promotes ethical and responsible decision-making;
• Ensures compliance with laws, regulations and all
appropriate accounting standards;
• Reviews the strategic direction and approves the annual
operating budget;
• Monitors the operating and financial performance of the
RACT Group;
• Approves and monitors major capital expenditure programs;
• Ensures a clear relationship between performance and
executive remuneration;
• Monitors risk management;
• Ensures that the members are fully informed of material
developments.
In the year there was ongoing scrutiny of our processes and
procedures by the Club’s outsourced Internal Auditor and the
Board again subjected itself to a performance review to ensure
its responsibilities were being carried out in the best possible
manner. An extensive system of documented and controlled
Celebrating 50 years of RACT
membership at our function in
August 2007 were long-serving
Chief Executive Denis Nation and
Mrs Jeannette Nation, with the
then-President, Ted Best AM.
policies and procedures is in place throughout RACT including
risk management and business continuity.
The Club’s governing body held 11 formal meetings in the
year and meetings were held in all three regions of the State.
The Committees which report to the Board held a total of
16 meetings.
The following Committees of the Board have clear operating
Charters and report to the Board on a regular basis:
• Audit and Risk Management
• Investment
• Road and Traffic
In July 2007, the Board welcomed Peter Dixon, of Launceston,
to fill a casual vacancy caused by the resignation of fellow
Launcestonian, Bruce Doolan, in June 2007. Peter has
extensive legal and business experience and is a strong
contributor to the Board’s deliberations. In February 2008,
Peter was appointed Chairman of the RACT’s Launceston-based
Northern Regional Advisory Committee.
John Bloomfield, of Ulverstone, retired from the Board in
October 2007 after eight years of dedicated service. The Board
wishes to place on record its appreciation of his contribution to
the affairs of the Club during his term of office. Mr Bloomfield
will continue his RACT association through his membership of
the North West Regional Advisory Committee.
7
The Year in Detail
Bruce Clark, of Burnie, was appointed to the Board in March
2008 to fill the casual vacancy caused by the retirement of
John Bloomfield. Mr Clark has a strong background in the retail
industry, having been Managing Director of a family business
operating in Burnie for 61 years until the sale of the business in
2007. He is keen to ensure that the interests of the North West
Coast continue to be well represented at a State level.
In October 2007, Honorary Life Membership of the RACT
was awarded to former Director and Past President, Jean
Trethewey, OAM and current Directors (and past Presidents),
David Catchpole and Tony Stacey, AM, in recognition of their
significant contribution to the Club over a combined total of
51 years.
We were delighted to learn that Director, Tony Stacey, AM,
was recognised in the Queen’s Birthday Honours in June
2008 for his service to the footwear manufacturing industry
and to the community through executive roles with a range
of arts, motoring and service groups. This is indeed a most
distinguished award and one that is richly deserved.
With sadness, we record the passing in May 2008 of Honorary
Life Member and former RACT President, Hugh Loane, OBE.
Hugh was a genuine and enthusiastic supporter of the Club for
over 25 years and actively represented the interests of motorists
on the North West Coast. He was highly regarded by all who
knew him.
ROADSIDE Assistance
At our 2007 Annual General Meeting
in November last year, three pastpresidents were awarded honorary
life membership of the club:
(from left) David Catchpole, Jean
Trethewey OAM and Tony Stacey.
In the year under review, 19 RACT ROADSIDE corporate
patrols and 62 metropolitan and country contractors attended
77,967 calls for assistance, which was nearly 1% more than
for the previous year. Corporate ROADSIDE patrols attended
in excess of 44,500 calls in metropolitan areas. They were
able to mobilise over 90% of these breakdowns on the spot.
Metropolitan Agents attended almost 14,000 jobs for members
with the remaining 19,500 jobs undertaken by the Country
Agent network.
On average, each call was attended within 28.1 minutes from
actual receipt of the request for assistance. Our Assistance
Centre handled over 106,000 inbound phone calls with an
average 76.1% answered within 30 seconds.
During the year, two ROADSIDE patrol vans were replaced with
diesel vehicles in line with RACT’s environment policy in reducing
our greenhouse footprint. Two new tow trucks were provided for
contracted towing services in the Hobart metropolitan area
to improve member service levels and maintain continuity
of service.
8
Winners of our Win a Mazda competition, Summerhill’s Joan and Nigel
Strange (left and right) were presented with their new car by John
McKenna of Mazda Launceston and RACT’s Launceston Team Leader
Lynne MacCrosty.
ROADSIDE Membership
The total number of personal ROADSIDE memberships grew
by 2,318 in 2007/2008 representing an increase of 2.2%.
There are now 108,918 personal members. Total membership
including commercial arrangements and relationship
memberships stands at 186,426.
ROADSIDE ULTIMATE membership has again proved very
popular with Tasmanians because of the comprehensive cover
provided. Membership of this premium product increased by
8.7% in the year and at the end of June 2008 the number
of ROADSIDE ULTIMATE members stood at 41,056.
More than 50% of all new members who joined throughout
the year chose ROADSIDE ULTIMATE.
More members than ever took advantage of the discounts
available through the ROADSIDE group pricing options.
47% of members are part of a membership group. With the
group pricing option, friends and family can now join into one
group and save on the annual subscription. The more members
in the group the greater the saving.
Another feature of the group pricing option is the ability to spread
the cost over the year via the direct debit system. Members
can choose to pay monthly, quarterly, half-yearly or annually
depending on the number in the group. There is no extra charge
for paying by direct debit and members can rest assured that
their ROADSIDE cover will never unintentionally lapse.
Travel
RACT Travelworld continued its growth in 2007/2008
achieving a 2.3% increase in revenues over the previous year.
Once again, the year under review saw a reduction in
commission received from suppliers and, in some cases,
this commission was reduced to zero. Therefore, our fees for
service were reviewed to help offset the loss of commissions.
2007 08
RACT Travelworld’s business ratio for the year was 72%
international sales and 28% domestic sales. We are one of the
few retail travel agencies in Victoria/Tasmania that has not ‘lost’
domestic sales – instead, holding our own with a vital part of
our business.
The year has been one of concentrating on ways to better
market to our clients / members. Very successful bi-monthly
information sessions were held across the state featuring nights
in Hobart, Launceston and Ulverstone to cover our nine office
locations. These sessions were well received by our guests and
subsequent bookings following each event have been strong.
The Northern Territory Muster in February and Cruise Holidays in
June were two of the largest attended events in our calendar.
RACT Travelworld has participated in strategic marketing forums
on a quarterly basis with constituent organisations RACQ,
RAASA and RACWA. With this relationship we are marketing
exclusive value-added opportunities that are not available
via other retail travel agency outlets. RACT Travelworld’s
relationship with JTG (Jetset Travelworld Group) has been
enhanced and many opportunities were delivered such as
the online booking engine.
RACT Travelworld has been productive in representing the
interests of Tasmanian travellers on a wide range of industry
issues, being the advocate as Tasmania’s largest retail travel
agency group. News releases and updates are regularly sent
to Tasmania’s media and we entered into a partnership with
TAFE Tasmania working with the Drysdale Institute for Travel
and Tourism sponsoring three Travel Scholarships for local
Tourism students.
Insurance
It has been a successful year for RACT Insurance in terms
of both financial and staff performance, illustrated by a 6.3%
increase in Gross Written Premium. RACT Insurance has,
once again, increased its market share in Tasmania and remains
number one in the market for both Home and Motor insurance.
This excellent outcome has been achieved through the provision
of first-rate products and services that meet the needs of our
customers.
2007/2008 was an eventful year with a continuation of
catastrophic storms in August and again, in April, when
conditions were described as hurricane-like. At the same time,
there were a significant number of individual house fires.
The insurance staff, contracted external assessors, repairers
and suppliers continued to respond promptly and with empathy
for all of the affected customers.
It was again pleasing to see service level targets exceeded
over the entire year despite increased numbers of claims.
Our customer satisfaction surveys have also been retained at
the nine out of ten level during the year reflecting our vision to
set the benchmark in terms of products and services for our
customers. RACT Insurance continues to make a real difference
in the community by helping our customers when they need
it most.
Young Tasmanian artist Hilton
Owen was the inaugural winner
of the RACT Insurance Tasmanian
Youth Portraiture Prize. The award
has already been an important
boost to Hilton’s future career as a
professional artist.
RACT Insurance has also continued to support the work
of local charities through staff allocated (paid) volunteer days.
In 2007/2008, staff voluntary work totalled more than
60 days for the community. Charities supported included
Headway rebuilding lives, RSPCA and the Cancer Council.
In 2007/2008, RACT Insurance staff were also very excited
about supporting emerging young artists in the community
through the RACT Insurance Tasmanian Youth Portraiture Prize,
which was organised in conjunction with Tasmanian Regional
Arts and Clemenger Tasmania. This event was so successful
that it is now agreed that it will continue for at least a further
three years. It has also been nominated for two national awards
with the Australian Business Arts Foundation.
RACT Insurance continues to support the U-Turn program
assisting Tasmanian youth by regularly donating damaged
vehicles. These vehicles are repaired and then donated back
to victims of car theft.
In April this year, three high-achieving Drysdale College students were
awarded the inaugural RACT Travelworld Scholarship, a prize that will
open doors into a dynamic industry. (Left to right) winners Persia Brooks,
Nicholas Denny and Susan Hurst, with RACT Travelworld’s Elizabeth
Roberts and Robyn Sinfield.
Branch Network
The nine branch offices around the State, together with
the Club’s Customer Service Centre, continue to provide
ease of access and professional service to our clients.
9
The Year in Detail
Our branch network has had a very successful year with all
branch locations performing well and receiving strong support
from clients who prefer to deal with their local branch. Branch
staff continued to provide valuable support to the Club’s
Customer Service Centre by logging into the telephone system
to cover periods of high demand. Further improvements to our
systems are providing increased flexibility for our sales staff
to transact business and interact with clients online, creating
an additional method of contact with sales staff when it is not
convenient to travel to a branch.
The commitment to the Club’s branch network has continued
during the year with the relocation of the Kingston branch to an
upgraded office within the Channel Court Shopping Centre, a
major refurbishment of the Launceston branch and the relocation
of the Rosny branch to a new and larger office next door to
our old branch in the Rosny Mall. Our Travelworld branch at
Ulverstone also received a major upgrade earlier in the year.
We are very proud of these new locations and refurbished offices
and are confident members will benefit from - and enjoy - these
upgraded facilities. With the recent completion of the new Rosny
branch a full upgrade of our branch network has almost concluded
with only the Hobart, Travelworld Collins Street and Burnie
branches not receiving a major upgrade over the last two years.
Plans are in place to upgrade these offices in the near future.
We are very pleased with the continued support provided to our
branch network and look forward to the opportunities that the
new look branch network will provide to clients.
Finance
The Club’s existing finance arrangements for personal loans
with our sister club, RACV, and home loans with the ANZ Bank
continue to provide highly competitive rates and conditions for
members.
Printers Steve Kitanovic and Roger
Rigon check proofs of our magazine
Motor News. Early next year we will
offer members the opportunity to
read the magazine in electronic form
via our website, rather than receiving
it as a printed copy by mail.
RACT home loans offer considerable savings on fees and
interest rates with attractive conditions. Our personal loans
offer some of the best interest rates available with further
discounts for ROADSIDE ADVANTAGE and ROADSIDE ULTIMATE
members.
Our personal loan product is designed to be extremely customer
friendly and easy to access, with a fast approval process.
All loan applications are undertaken by telephone and loan
sign-ups are completed in our branches or via mail if this is
more convenient for the customer.
We are confident that RACT Finance provides high quality
and competitive rates for our members seeking a home
or personal loan.
10
At the inaugural Patrol Skill Showcase in Canberra, the RACT’s Josh
Dobie (centre) competed against patrollers from other clubs, winning
the category for Best Practice in Customer Service.
Human Resources
The RACT is committed to ensuring that it provides an
environment where staff will say ‘this is a great place to work’.
The 2007/2008 Employee Feedback Survey confirmed that
progress had been made with an overall satisfaction rate of
78.95% compared to 74.16% in 2005/2006.
A key ‘people’ initiative developed in the year was the
‘CARE Program’, which provides an opportunity for all RACT
employees to have a one-on-one meeting with their ‘manager
once removed’. The focus of this meeting is on career
aspirations and development opportunities and the feedback
from both employees and managers is that the process has
had some very positive outcomes.
2007/2008 saw the launch of a bi-monthly employee
newsletter, ‘inteRACTion’, which is a forum for all staff to be
kept informed of activities throughout the RACT network
including health and safety, training, employee recognition
and social events.
Occupational Health and Safety is a key issue for the business
and to reinforce our commitment to ensuring the safety of
our employees and our customers, an external provider
was appointed to undertake an Occupational Health and
Safety Management Systems Gap Analysis. This process
acknowledged good practices that are already in place and
identified opportunities to take our safety management to a
higher level. Going forward, these actions will help form part
of the Club’s Annual Occupational Health and Safety Plan.
RACT staff are involved in many areas of the business including
Occupational Health and Safety and Employee Consultative
Committees. Members of these committees are actively
empowered to contribute to improved systems and processes
that will benefit both our employees and our customers.
2007 08
Technical Services
Technical Services continued to provide high quality vehicle
inspections on behalf of members and used car dealers.
Technical Advice remains a highly used and valuable service for
members on a wide range of matters including advice on vehicle
purchase, operation and maintenance. Technical Services
provided a significant research report on vehicle operating costs
on 60 popular vehicles during the course of the year.
Technical Services in Hobart continued pre-auction vehicle
appraisal inspections for ex-Government vehicles being sold
through Pickles Auctions. As these vehicles are unregistered
at the time of sale, a roadworthy certificate is also included in
the inspection. The respected reputation of the RACT in the
community has given buyers peace of mind that the vehicle
they are bidding for has been checked by RACT and is ready
to be registered.
Winter car safety checks were undertaken in Hobart and
Launceston as a community service. These checks highlighted
various safety and maintenance related issues for members and
the general community.
Child Restraints
RACT Technical Services continues to be recognised as the
foremost expert in the correct fitting of child restraints in
Tasmania to suit individual vehicle and member needs. The
RACT Child Restraint Advisory and Fitting Service sold in excess
of 500 child restraints and provided valuable advice and fitting
services to RACT members and customers. There was also
an increase in demand for the short-term Child Restraint Hire
Service. RACT Technical Services also provided information
sessions to expectant parents and community groups.
Battery Service
During 2007/2008, the RACT Battery Replacement Service
provided more than 8,000 batteries to members through the
Patrol and Contractor network. The RACT provides free delivery
and installation of RACT batteries, either at the roadside or at
the member’s home, in metropolitan areas with RACT patrol
vans carrying between 19 and 22 batteries to meet the needs of
members. Fitting the battery to a member’s vehicle is only part
of the service provided. After installation, the vehicle’s charging
and electrical systems are checked to ensure optimum starting
performance and battery life expectancy.
RACT batteries are also available at over 35 ROADSIDE Agents
and at selected Approved Repairers. RACT Marine Batteries
are distributed by four marine outlets throughout the state and
can also be delivered to members by ROADSIDE patrols in
metropolitan areas as well as to wharves and boat ramps.
Approved Repairers like Matt Kaine, Rod Marshall and Danny Phasey of
Marshall Auto Repairs of Legana are members of a statewide network
offering members skilled, professional and guaranteed automotive repair
services around the state.
Approved Repairer Service
This service continued to provide members with the assurance
of guaranteed vehicle repairs and maintenance from a network
of 57 RACT Approved Repairers throughout the state.
The Approved Repairer network has a wide range of specialist
repairers who are able to undertake almost any job required on
a vehicle ranging from general mechanical repairs to EFI
diagnosis, interior trim repairs and windscreen repair and
replacement. RACT Approved Repairers adhere to a code
of conduct set down by the RACT to ensure quality repairs.
Todd and Sharn Hitchins of Rokeby
are just two of the many Tasmanians
who have had their child restraints
expertly fitted by our RACT Technical
Services staff.
Country Agent Network
The Country Agent network continued to provide quality service
to RACT members through 62 contractors in all country areas
of Tasmania. During the year, service was provided to 19,387
members in country areas.
Thirteen twin-cab slide-bed tow trucks are located at strategic
locations throughout the state to provide the best possible
service to RACT members when they break down. The twin cab
tow trucks have proved invaluable in the transport of members
and their families when their vehicle has broken down and
towing has become necessary. RACT ROADSIDE ULTIMATE
has provision for the transportation of both the vehicle and up to
five people to the member’s repairer or home from anywhere in
Tasmania at no cost if the vehicle cannot be mobilised at
the roadside.
Driver Training
RACT Driver Training in Launceston, Devonport, Burnie and
Hobart continued to provide a valuable contribution to the
driver training of young motorists.
RACT is involved in the stakeholder reference group for
the novice driver training and licensing reforms.
11
The Year in Detail
RACT continued to provide support to the P-Plate action
program that provides Crash Free Driver Training courses for
P-Plate drivers at year 11/12 colleges around the State funded
by the Motor Accidents Insurance Board and Norske Skog.
Eight courses were conducted during the year. Driver training
resources were also provided over five days for the Rotary Youth
Driver Awareness (RYDA) program operating on the North-West
Coast.
Information Systems
The Information Systems department undertook a number
of projects during the year:
• RACT Website
A substantial amount of work has been undertaken to
redevelop the RACT website, with Stage 1 (of three defined
stages) to be launched in October 2008. This work involved
all areas of the business, focus groups and four external
consulting businesses to assist in defining, designing and
developing the new web site.
• Implemented new versions of email monitoring, virus
protection and spam filtering software that will enhance
the efficiency and security of the RACT’s computer systems.
• Direct Marketing
During the year increased efforts were made in providing
information to members about other RACT products or
services. This has proven to be very successful, resulting in
significant growth in multiple product holdings by members.
• Facilitated the opening of the new Rosny branch with
the provision of voice and data services to the site.
• Renewed the contract for the provision of information and
communications technology services to RACT Insurance.
• Completed a trial of an electronic vehicle inspection system.
• Migrated computer systems and services from older server
technology to ‘virtual server’ technology which allocates
server processing capacity to meet demand during periods
of high volume and provides improved disaster recovery
capability.
motornews
News | Cars | Travel | Prizes
2008
December 2007 / January
Limited
Automobile Club of Tasmania
The magazine of The Royal
Hobart’s gateway–
Bowen or
Bridgewater?
Cruising Scandinavia
the winners
Australia’s Best Cars –
45
Travel Ideas start on page
page 30
Check The Wish List on
Refining and streamlining the distribution database of the bi-monthly
magazine Motor News has cut production costs and saved resources.
12
Following a restructure of the business and senior management,
marketing activities related to individual products or service
areas are administered by the relevant manager.
• Upgraded and modernised the data infrastructure
that supports the branch network in order to provide
opportunities for future facilities that will enhance
customer service.
• Worked with our sister club in South Australia, the RAASA,
to integrate and implement a new ROADSIDE Despatch
system. (Due November 2008.)
As part of our support for the P-Plate
Action program, Alex Jerrim of Driver
Safety Services presented his
Crash-free Driving course to
Claremont College students (from
left) Bec Monks, Matthew Hume,
Ashley Youd and Hayley Rayner.
Group Marketing
The new site and its planned future directions is recognition
that to maintain relevance in the marketplace, RACT must
live up to its vision of being “…the most dynamic and
innovative service organisation in Tasmania.”
Motor News
Our bi-monthly magazine Motor News ( re-named Motor News
Journeys from the October-November 2008 issue) continues to
be a well-regarded and popular publication with RACT members
and the wider community.
During 2007/2008, the magazine’s distribution settled at
around 114,000, as audited by the Circulations Audit Board.
An operational highlight has been the ongoing refinement of
the mailing list database, in particular the removal of duplicated
copies sent to the same address. As well as cutting production
costs, this initiative avoids unnecessary use of resources and
has been well received by members.
There has been a clear focus on continuing to enhance the
appearance and improve the content of the magazine, through
the use of bigger and brighter images, a higher-quality stock
and stronger editorial material. Motoring and road safety issues
have remained the main focus of the opening section; while the
substantial travel section is popular and effective, as measured
by RACT Travelworld business written as a direct result of
promotion in the magazine.
Motor News continues to be a credible and reliable source of
news, advice and information for members in these key areas.
Each edition includes material such as current issues, letters,
opinion, technical information, car tests, consumer advice,
travel, touring and prizes, as well as information on RACT
products and services.
2007 08
Motor News has continued to play a pivotal role in RACT’s prolific
public affairs activities and is the Club’s central membership
communication tool.
has also welcomed regular attendance by senior DIER officials at
our Regional Advisory Committee meetings.
The Tasmanian Government launched its Tasmanian Road Safety
Strategy 2007-2016 in June 2007, with the four key strategic
directions of: Safer travel speeds; Best Practice Infrastructure;
Increased Safety for Young Road Users; and Enhanced Vehicle
Safety. This provides a sound strategic platform for road safety
initiatives in our State. RACT welcomes a number of initiatives
that have flowed from the Strategy that the Club has previously
lobbied for, including:
• broader use of innovative technology such as Electronic
Speed Limits Signs, especially new flashing signs at school
zones, a trial of alcohol interlocks for repeat drink-driving
offenders and stronger drug-testing powers for police;
The RACT’s view that the Bowen Bridge should be the main new gateway
to Hobart generated widespread support from local councils, transport
economists and many club members.
Advocacy and Public Affairs
The RACT now has a dedicated Public Policy and
Communications unit that underpins our efforts to influence
government and the policy agenda for the benefit of members
and to advance the aim of safer drivers, in safer cars, on
safer roads. RACT members can expect the Club to publicly
advocate on their behalf and to provide information on issues
that affect them.
To help achieve this, the Club requires reliable contacts within
the Government and Opposition parties at the Federal and
State levels, together with strong networks and collaboration
with other groups such as relevant government agencies, local
councils, community representatives and lobby groups.
2007/2008 was a period of significant change in Tasmanian
public life, including the resignation of Premier Paul Lennon,
the retirement of long-serving and well-regarded Tasmania
Police Commissioner, Richard McCreadie, and a number of
changes to ministerial arrangements. The Club is committed to
good working relationships and ongoing consultations with new
State Minister for Infrastructure Hon. Graeme Sturges MHA,
and Tasmania Police.
In addition, during 2008 we concluded a new two-tiered
framework for regular formal consultations between RACT and
the Department of Infrastructure, Energy and Resources [DIER],
at both Agency Head/CEO and General Manager levels. This has
provided more effective discussions and information flows with
our key Tasmanian Government stakeholder agency. The Club
• extending better roadside safety measures such as flexible
roadside barriers and audible road markings;
• the adoption of minimum safety ratings for the Tasmanian
government vehicle fleet; and
• a public education strategy on the benefits of Electronic
Stability Control (ESC).
During the first half of 2008, the issue of fuel prices dominated
Tasmanian and national media as commodity prices escalated
and local petrol and diesel prices followed, with new Tasmanian
Premier, Hon. David Bartlett, announcing a Fuel Summit for
September 2008 in response. The RACT continued its own
price monitoring website and regularly spoke on behalf of
motorists when prices were too high compared to the rest of
Australia – more often than not, a lone voice in this arena.
Federal Labour made $445.45 million of road, rail and
infrastructure election promises for Tasmania prior to the 2007
Federal election. The RACT takes very seriously its role to
monitor these promises and whether or not they have been kept.
Members will be kept informed on the progress of these funding
promises through Motor News.
During the year we were proud to
support two of our members in
successful endeavours for good
causes overseas – Walter van
Praag cycled for 4000 kilometres
through Europe to raise awareness
of cystic fibrosis; while long-distance
swimmer Anne Steele swam the
English Channel in support
of the Children’s Cancer Institute
of Australia.
The Club has continued to contribute as a member in a number
of important forums such as the Tasmanian Road Safety Council
and the Road Safety Task Force. These remain valuable and
unique sources of official information supplied by agencies in a
collegial spirit to address the ongoing issue of the road toll.
Some key ongoing public advocacy issues include:
• The need for road safety education to be taught in all
schools across Tasmania;
• Monitoring of progress on key infrastructure projects such
as the Brighton transport hub and the north-south rail line
improvements;
13
The Year in Detail
• The future of public transport in Tasmania;
Regional Advisory Committees
• Rail ownership and freight capacity improvements
in the State;
North West
• The persistence of repeat drink-driving offence statistics;
• Safety defects in the Tasmanian passenger fleet; and
• How we can best ensure our older drivers are supported
when it comes to their personal mobility.
RACT has also supplied resources for a number of policy and
communications working groups as a member of the Australian
Automobile Association (AAA). These include the Australasian
New Car Assessment Program (ANCAP) for crash-testing
and safety rating, the Australian Road Assessment Program
(AusRAP), and Australia’s Best Cars judging process and
national magazine. Two key national policy projects RACT has
worked on during 2007/2008 include:
T
• keys2drive: the Australian Government committed
$17 million over five years in its 2008 Budget for the
Clubs to implement the program, which aims to develop
supervision of learner drivers and will deliver new online
resources for novice, supervisors and instructors
(see www.keys2drive.info). Tasmanian-based Driver Safety
Services is managing the project and the national pilot is
expected to be trialled in Tasmania in early 2009. Australian
Government Infrastructure Minister, Hon. Anthony Albanese
Eco-driving
MHR,
Howannounced
to save fuel and the funding at the RACT’s head office in
cut greenhouse gas
emissions
Hobart
on 1 May 2008.
During 2007/2008, the North West Regional Advisory
Committee continued to lobby for improvements to sections of
the road network on the North West Coast. In particular there
were issues relating to the speed limit imposed on the Bass
Highway at Round Hill, Burnie following a major upgrade.
The Sisters Hills highway project is continuing and the
Committee is pleased with the outcome to date. The Ulverstone
Bypass dual highway was completed and has proven to be a
significant improvement to efficient traffic flow along the North
West Coast.
The Committee was also concerned about safety issues in most
towns on the North West Coast including traffic movement in
Devonport. The results from a traffic management study
are awaited.
Doctors Rocks, near Wynyard, and the Stanley/Bass Highway
intersection were areas of concern; however, each of these
areas will receive attention by the Department of Infrastructure,
Energy and Resources during 2008/2009.
he Australian Automobile Association and
its member clubs, including the RACT, have
taken up the environmental challenge with the
release of a formal climate change statement and
a package of emission-reduction and membereducation measures.
Our Group Chief Executive Greg Goodman says
that the climate change challenge requires all
sectors of the community to play their part in
reducing emissions, and that the motoring clubs
would continue to take a leading role in
promoting this approach.
“AAA and the clubs have for many years
strongly supported cleaner, less carbon-intensive
and sustainable motoring through a range of
initiatives including vehicle testing, campaigns
for legislative action such as fuel quality
standards and education like the Green Vehicle
Guide,” Mr Goodman says.
“It’s important that as well as advising our
members on how to reduce the impact of their
motoring emissions, the RACT must also ensure
that we are setting a ‘good corporate citizen’
example ourselves.”
The AAA Climate Change initiatives, in which
the RACT will participate, include:
UÊ Ê>Ì>ÊV>ÌiÊV>}iÊÃi>ÀÊÌÊ}}ÌÊ
the AAA clubs’ environmental activities and
initiatives, to ensure a well-informed national
debate
The road to
greener motoring
Recent research* carried out for motoring clubs
in Australia shows that motorists’ concern
about the environmental impact of cars is
on the rise, while support for the role of the
clubs in providing advocacy and
information on key issues affecting
members remains high.
UÊ ÊiiÀ}ÞÊ>`ÊiÃÃÃÊ>Õ`ÌÊ>ÌÊVÕLÊiÛi]Ê
to identify strategies to lower organisational
greenhouse gas emissions
UÊ /iÊ«ÀÛÃÊvÊi`ÕV>ÌÊ>`ÊvÀ>ÌÊÌÊ
RACT members through the AAA’s Eco-driving
project, as well as regular communications
through the RACT’s website and magazine
UÊ Ý>}Ê «ÌÃÊ ÌÊ >L>ÌiÊ ÀÊ vvÃiÌÊ ÌiÊ
RACT’s roadside service fleet emissions
“With the recent announcement of the domestic
motor vehicle industry review to be headed by
Steve Bracks, the motoring clubs through AAA
will continue to advocate a strong focus on lowemission, lower fuel-consumption vehicles,” Mr
Goodman says.
The AAA Climate Change statement provides a
new impetus for the RACT to assist in reversing
the global warming trend, while balancing
motorists’ need for safe and affordable travel.
It’s important to understand that motorists
make only an 8% contribution to Australia’s
greenhouse emissions – and with the RACT’s
help, Tasmanian drivers can take practical steps
to become part of the solution by further
reducing that figure.
AAA’s national climate change statement On The
Road To Greener Motoring can be downloaded
from www.aaa.asn.au. Check the Green Vehicle
Guide at www.greenvehicleguide.gov.au.
* Motorists’ Attitudes and Priorities in 2007: Australian
Automobile Association National Survey – conducted by
ANOP Research Services Pty Ltd in May 2007
6
April / May 08
P
rivate motor vehicles in Australia produce
around 43.7Mt of greenhouse gases each
year, which accounts for approximately 8% of
the nation’s total greenhouse gas emissions.1
• Greener Motoring: The motoring clubs have adopted
principles to ensure sustainable motoring for all members
and have committed to assist and encourage members
to reduce or offset their emissions, along with minimising
the emissions generated by Club products and services.
The AAA also hosted a national climate change summit in
Canberra in June 2008 to bring together leading experts
to critically examine the place of cars in the climate change
framework and work on future strategies
(see www.aaa.asn.au/greenermotoring).
Gases released by a combustion engine are
linked to its fuel consumption. One of the most
cost-effective means of reducing vehicle emissions
is by practising ‘eco-driving’ techniques.
This strategy can reduce fuel consumption by
changing your driving style, planning vehicle
trips, choosing efficient vehicles and driving
smoothly.
Eco-driving is easy to do, but it can make
significant improvements to fuel consumption.
It’s simply a better and safer way to drive.
Check these ten eco-driving tips – can they help
you change your driving style?
1. Buy green
Check environmental performance (fuel
consumption and greenhouse rating) before
you buy a car. Visit www.greenvehicleguide.
gov.au for green star ratings.
2. Plan your journey
Planning your route can avoid delay and
diversion. Ten minutes of unnecessary driving
in a one-hour trip means a 14% decrease in
fuel efficiency. For short journeys consider
cycling, public transport or walking.
3. Check tyre pressures
frequently
Driving on tyres with air pressure 50kPA
lower than it should be decreases fuel
efficiency by up to 4%.
4. Reduce loads and avoid the
need for roof racks
Driving with unnecessary onboard weight
leads to a significant decrease in fuel efficiency.
The air resistance caused by roof racks and
open windows adds to aerodynamic drag
and fuel consumption. The faster you drive,
the more air resistance there is. Driving with
all the windows open at highway speeds can
reduce fuel efficiency by more than 5%.
5. Do not warm up your engine
before driving off
Today’s passenger cars don’t require warming
up, except in very cold climates and after
long periods of non-use. Slow running is
enough to warm up the engine.
6. Use air conditioning only
when necessary
Using air conditioning when the outdoor
temperature is 25°C increases fuel
consumption by 12%.
7. Accelerate gently and keep
your speed constant
Start off gently (20km/h in five seconds,
for an 11% reduction in fuel consumption)
and avoid abrupt, heavy acceleration while
driving. Avoid tailgating, which causes
unnecessary acceleration/deceleration and
increases fuel consumption by up to 6%.
Use higher gears as soon as traffic allows.
8. Use engine braking
Releasing the accelerator when you
recognise the need to slow down stops the
fuel supply, leading to a 2% decrease in fuel
consumption.
9. Do not idle your engine
Ten minutes of engine idling (in neutral,
with the air conditioning off) wastes 130ml
of fuel. If it is safe to do so, turn your engine
off instead of letting it idle.
10. Offset your CO2 emissions
If you are driving economically and cannot
reduce your car use then consider buying
carbon offsets equivalent to your annual
mileage.
1 Australian Greenhouse Office (AGO), National Greenhouse Gas
Inventory, 2005.
April / May 08
During the year, Australia’s motoring
clubs released a joint climate
change statement and publicised a
package of emission-reduction and
member-education measures.
14
7
The RACT will continue to take the concerns of its membership
directly to Government to effect policy change where necessary.
At the same time, the RACT will publicly support good policy
and action and will further develop its role as a “watchdog” for
its members and as a good corporate citizen and leader in the
wider Tasmanian community.
With the other Australian motoring clubs, RACT is a strong supporter of
ANCAP, the Australasian New Car Assessment Program, which conducts
crash tests on all new vehicles and awards star ratings for safety.
North
The Northern Regional Advisory Committee continued to
represent the interests of Northern motorists by lobbying the
State Government and other authorities on a range of road
safety and road improvement issues.
2007 08
In 2007/2008, significant issues handled by the Committee
included upgrading of the East Tamar Highway, Dilston Bypass
issues, improvements to the West Tamar Highway, east/west
connector roads across Launceston, upgrading of northern and
north east truck routes, on/off ramps from Oakdene Rd to Bass
Highway at the Silverdome, speed reduction on the West Tamar
Highway at Riverside, as well as local speed zoning and traffic
management issues. The Committee continued its interest in
upgrading rail infrastructure to enable more freight, particularly
logs, to be transported by rail to reduce log truck kilometres
travelled on our roads.
South
The Southern Regional Advisory Committee has welcomed
an increase in direct dialogue with the Tasmanian Government.
Senior officials from the Department of Infrastructure, Energy
and Resources have been guests at our meetings this year,
providing a number of informative updates and giving members
the opportunity to ask a series of direct questions. Highlights
of the Committee’s lobbying efforts include the decision to ban
right-hand turns out of Cleary’s Gates onto the Brooker Highway,
the planned implementation of a clearway in Macquarie Street
during peak travel time, and a government trial of alcohol
interlock devices to help address repeat drink-driving offences.
During the year, the Committee also hosted several longstanding RACT members to address the meeting about their
particular interests in road safety or infrastructure planning.
Australian Automobile Association
The Australian Automobile Association (AAA) ably represented
the RACT and its affiliated interstate clubs/associations at both
national and international levels. AAA is represented on many
national bodies and the viewpoints expressed by the association
are recognised as the official voice of motorists in this country.
Reciprocity
For many years reciprocal ROADSIDE assistance has been
offered by each of the state motoring organisations, an initiative
that provided an enormous boost not only to their membership
but also to motoring generally and interstate travel in particular.
Today, reciprocal service arrangements extend to more than
100 similar organisations around the world through affiliation
with the Federation Internationale de l’Automobile (FIA).
Staff
The Board is pleased to place on record its personal
appreciation for the manner in which the RACT team has risen to
the many challenges in the year with diligence and commitment
to member service and to ‘live the RACT Vision’ of being “…the
most dynamic and innovative service organisation in Tasmania.”
Acknowledgements
2007/2008 saw the continued involvement of the RACT with
many bodies such as government departments, agencies and
businesses. The Board of the RACT appreciates its relationship
with these many organisations. The Board also acknowledges
the wider RACT family in the successes achieved during the
year. ROADSIDE contractors, country agents, approved repairers
and many other businesses and organisations assisted the RACT
in meeting the needs of its members.
Bonorong Wildlife Centre keeper
Kelsey Smith with Dougie the
devil – through our club magazine
we have helped Bonorong Park
publicise their initiatives to protect
our island’s native wildlife.
It also appreciates the interest of the media in the many issues
that were raised by the RACT on behalf of its membership base.
Roger Locke
President
Greg Goodman
Group Chief Executive
15
Directors’ Report
In respect of the year ended 30th June 2008, the directors
6. FUTURE DEVELOPMENTS
of The Royal Automobile Club of Tasmania Limited
Disclosure of information regarding likely developments in
the operations of the consolidated entity in future financial
years and the expected results of those operations is likely
to result in unreasonable prejudice to the consolidated entity. Accordingly, this information has not been included in
this report.
(RACT Limited) present the following report made out
in accordance with a resolution of the directors.
1. DIRECTORS
The names of the directors during and since the end
of the financial year are:
Mr R S Locke (President)
Mr S E Slade (Vice President)
Mr P J Joyce (Vice President)
Ms J M Archer Mr E C Best, AM, JP Mr J R Bloomfield, JP (to 30/10/2007)
Mr D M Catchpole
Mr B F Clark (from 26/03/2008)
Mr P A Dixon (from 31/07/2007)
Mr R H Holmes
Mr C J Langdon
Mr A C Stacey, AM Mrs K A Westwood 7. MEETINGS OF DIRECTORS
During the financial year, 27 meetings of directors (including
committees) were held. The number of meetings attended
by each director during the year is disclosed in the
following table. The company has an Audit & Risk Management Committee
which met 5 times during the financial year. The members
of this committee are Mr C J Langdon, Ms J M Archer,
Mr R H Holmes and Mrs K A Westwood. The Audit & Risk
Management Committee’s main responsibilities are to
ensure that the audit process (both external and internal)
is effective, that external reporting and corporate governance
responsibilities are addressed, and that internal control
and risk management structures are appropriate.
Directors are all members in accordance with the
Constitution. Directors’ qualifications and experience are
provided in section 13 of this report.
2. PRINCIPAL ACTIVITIES
The principal activities of the consolidated entity were to act
as a roadside assistance provider, travel agent and general
insurance distributor. 3. FINANCIAL RESULTS OF THE
CONSOLIDATED ENTITY
The consolidated entity’s net profit after income tax
Mr R S Locke (President)
Mr S E Slade (Vice-President)
Mr P J Joyce (Vice-President)
Ms J M Archer
for the year ended 30 June 2008, was $1,440,531
(2007, $3,074,002).
4. REVIEW OF OPERATIONS
A review of operations is included in the President’s Report
which accompanies this report.
5. SIGNIFICANT CHANGES IN STATE
OF AFFAIRS
As of September 1 2007 the consolidated entity acquired
an interest in RACT Insurance Pty Ltd as a result of a joint
venture agreement with Suncorp Metway Insurance Ltd.
16
2007 08
Board/Committee
Board
Road & Traffic
Audit & Risk
Management
Investment
Board & Executive
Review
Total meetings held
During 2007/2008
11
6
5
4
1
Director
Attendance at Meetings
J M Archer
10
E C Best AM JP
9
J R Bloomfield JP
2
D M Catchpole
5
3 (from 30/10/07)
*
*
3 (from 30/10/07)
*
3
1
1 (to 30/10/07)
*
*
*
9
*
*
*
*
B F Clark
4 (from 26/03/08)
1 (from 29/04/08)
*
*
*
P A Dixon
11
4 (from 30/10/07)
*
*
*
R H Holmes
11
4
5
3 (from 30/10/07)
*
P J Joyce
10
5
*
4
*
C J Langdon
9
*
5
4
*
R S Locke
8
*
0 ( to 30/10/07)
3
1
S E Slade
9
6
*
*
1
A C Stacey AM
9
*
*
3
1
K A Westwood
10
*
4
*
*
(to 30/10/07)
(to 30/10/07)
* Director not a member of this committee
Mr E C Best
AM, JP
Mr R H Holmes
Mr D M Catchpole
Mr P A Dixon (from 31/07/2007)
Mr C J Langdon
Mr A C Stacey
Mrs K A Westwood
AM
17
Directors’ Report
8. EVENTS SUBSEQUENT TO BALANCE DATE
10. CORPORATE GOVERNANCE
There are no other matters or circumstances that have arisen
since the end of the financial year that has significantly
affected, or may significantly affect, the operations of the
consolidated entity, the results of those operations, or the
state of affairs of the consolidated entity in future financial
years.
As at the date of this report, the board comprised twelve
directors. The board meets on a monthly basis and its
primary functions include:
9. INDEMNITY OF OFFICERS AND AUDITORS
During the financial year, the company paid a premium in
respect of a contract insuring the directors of the company
(as named above), the company secretary, Mr Greg
Goodman, and all other executive officers of the company
and of any related body corporate, against a liability incurred
as such a director, secretary or executive officer, to the extent
permitted by the Corporations Act 2001. The contract of
insurance prohibits disclosure of the nature of the liability and
the amount of the premium.
The company has not otherwise, during or since the financial
year, indemnified or agreed to indemnify an officer or auditor
of the company or of any related body corporate against a
liability incurred as such an officer or auditor.
(a) the approval of the annual financial statements
and the supervision of external audit activities;
(b) the establishment of the long term goals of the company
and strategic plans to achieve those goals;
(c) the review and adoption of annual budgets for the
financial performance of the company and monitoring
the results on a regular basis;
(d) ensuring that the company has implemented adequate
systems of internal controls; and
(e) appropriate monitoring of compliance and internal
audit activities. All directors have the right to seek independent legal and
accounting advice (at the company’s expense) concerning
any aspect of the company’s operations or undertakings.
11. COMPANY SECRETARY
Mr G Goodman MAICD, Company Secretary,
was appointed to the role in 1999.
12. AUDITOR’S INDEPENDENCE
DECLARATION
The Auditor’s independence declaration is included
on page 20 of the financial report.
18
2007 08
13. DIRECTORS’ QUALIFICATIONS AND EXPERIENCE
Mr R S Locke BE, Grad Dip Prof Mgt, FIE Aust., MAICD
Chartered Professional Engineer
Director, RACT Insurance Pty Ltd
Mr S E Slade CDC Dip, Grad Dip HSc, Grad Cert Risk Mgt, FAICD, MRMIA,
CPMSIA, RSP (Aust)
Chief Executive Officer, YMCA of Hobart Inc Principal Consultant, Business Continuity Institute of Australia
Alderman, Glenorchy City Council
Director, O Group
Mr P J Joyce LL.B, MCL, MAICD
Managing Partner, Butler McIntyre & Butler
Member, Taxation Institute of Australia (Tasmanian Division)
Ms J M Archer GAICD, GMQ
Engagement & Development Manager,
University of Tasmania, Launceston
Director, St Giles Society
Mr E C Best, AM, JP, BSc, BE, MBA, FIE Aust., FAICD Director, RACT Insurance Pty Ltd
Mr J R Bloomfield JP FREI, MAICD (to 30/10/2007)
Company Director, Bloomfield First National
Fellow, Real Estate Institute of Tasmania
Director, Real Estate Institute of Tasmania
Public Officer, Central Coast Chamber of Commerce
& Industry
Vice President, Honorary Justices Association of Tasmania
- North West
Mr D M Catchpole B.Ec, Dip FP, FCPA, CFP, FAICD
Chairman-Board of Advice, Shadforths Limited
Treasurer, Royal Hobart Hospital Research Foundation
Company Director
Mr P A Dixon, LL.B., BD (Hons), MBA, MAICD (from 31/07/2007)
Legal Practitioner
Lecturer in Management, School of Management,
University of Tasmania
Associate Dean, (Teaching & Learning) Faculty of Business,
University of Tasmania
Notary Public
Mr R H Holmes AASA, MAICD
Board Member, Tasmanian Transport Industry
Accreditation Board Director, TBA Services Pty Ltd
Mr C J Langdon CA, MAICD
Company Director
Mr A C Stacey, AM, MAICD
Trustee Director, Tasplan Industry Superannuation Fund
Chairman, Theatre Royal Management Board
Member, Brand Tasmania Council
Mrs K A Westwood, B.Com., GAICD, FNIA, ASA, MIIA, MRMIA
Manager Commercial, Nyrstar
This report is signed in accordance with a resolution of
directors pursuant to section 298(2) of the Corporations
Act 2001, this 23rd September, 2008.
R S LOCKE
Director
C J LANGDON
Director
19
Auditor’s
Independence Declaration
Chartered Accountants
advice to advantage
Auditor’s Independence Declaration
Auditor’s Independence Declaration to the Directors of The Royal Automobile Club of
Tasmania Ltd
In relation to our audit of the financial report of The Royal Automobile Club of Tasmania Ltd for
the financial year ended 30 June 2008 to the best of my knowledge and belief, there have been
no contraventions of the auditor independence requirements of the Corporations Act 2001 or any
applicable code of professional conduct.
H J GIBSON
PARTNER
WISE LORD & FERGUSON
Date: 12 September 2008
1st floor 160 Collins Street Hobart 7000, PO Box 1083 Hobart TAS 7001
Tel: (03) 6223 6155 Fax: (03) 6223 8993 Email: email@wlf.com.au Internet: www.wlf.com.au
Partners: Peter Beven, Robert Whitehouse, Harvey Gibson, Danny McCarthy,
Douglas Thomson, Joanne Doyle, Stuart Clutterbuck, Ian Wheeler
Managers: Shenna Hurd, Marg Marshall, Sharon Breen, Dean Johnson,
Alicia Leis, Melanie Richardson, Nick Carter, Paul Lyons, Kane Ingham, Kate Barnes
Consultants: Brent Palfreyman, Robert Whitehouse
20
Statement of Financial Performance
for the financial year ended 30 June 2008
CONSOLIDATED
NOTES
Revenue
Share of profit in associate
2
2,7
Other income
Roadside agents expenses
Cost of goods sold
Employee benefits expense
COMPANY
2008
$
2007
$
2008
$
2007
$
21,964,434
22,649,511
21,540,710
20,412,450
518,134
-
-
-
(992,870)
516,554
(21,601)
151,325
(2,092,321)
(1,882,408)
(2,092,320)
(1,882,408)
(617,486)
(599,676)
(617,486)
(599,676)
(10,030,891)
(9,465,315)
(10,030,891)
(9,465,315)
Marketing expense
(1,020,054)
(1,117,302)
(1,020,054)
(1,117,302)
IT & communications expense
(1,091,542)
(918,828)
(1,091,542)
(918,828)
Occupancy & maintenance expense
(1,295,179)
(1,005,021)
(1,295,179)
(1,005,021)
Financial & consultation fee expense
(660,430)
(616,150)
(638,848)
(616,150)
Depreciation & amortisation expense
(1,053,988)
(1,084,816)
(1,053,988)
(1,084,816)
Other expenses
(2,368,811)
(2,762,686)
(2,365,822)
(2,723,429)
1,258,996
3,713,863
1,312,979
1,150,830
181,535
(639,861)
80,885
148,857
1,440,531
3,074,002
1,393,864
1,299,687
Profit before income tax
Income tax expense
Profit attributable to members
of the parent entity
3
2007 08
Notes to the Financial Statements are included on pages 25 - 54.
21
Statement of Financial Position
as at 30 June 2008
CONSOLIDATED
Current Assets
COMPANY
2008
$
2007
$
2008
$
2007
$
4,197,312
2,795,538
1,118,124
931,777
NOTES
Cash assets and cash equivalents
Receivables
5
1,848,734
3,421,883
1,578,827
2,221,757
Inventories
9
127,237
133,051
127,237
133,051
Other current assets
10
271,139
279,264
271,139
279,264
Other financial assets
6
2,000,000
3,300,000
16,511,153
15,128,243
8,444,422
9,929,736
19,606,480
18,694,092
8
1,477,508
1,585,490
1,477,508
1,585,490
11
7,661,325
7,428,140
7,544,000
7,428,140
Total Current Assets
Non-Current Assets
Intangibles
Property, plant and equipment
Deferred tax asset
3
221,157
106,757
221,157
98,898
Investment in associate
7
14,961,341
-
-
-
Other non-current assets
10
198,101
399,666
198,101
399,666
Other financial assets
6
4,619,635
17,622,304
10,001
10,001
Total Non-Current Assets
29,139,067
27,142,357
9,450,767
9,522,195
Total Assets
37,583,489
37,072,093
29,057,247
28,216,287
Current Liabilities
Payables
12
2,749,377
2,807,574
2,711,851
2,809,008
Provisions
13
5,382,720
5,082,720
5,382,720
5,082,720
Current tax liability
3
(145,434)
562,262
(145,434)
562,262
7,986,663
8,452,556
7,949,137
8,453,990
Total Current Liabilities
Non-Current Liabilities
Provisions
14
313,464
263,440
313,464
263,440
Deferred tax liabilities
3
642,473
1,046,136
476,821
465,294
955,937
1,309,576
790,285
728,734
8,942,600
9,762,132
8,739,422
9,182,724
28,640,889
27,309,961
20,317,825
19,033,563
27,726,294
26,395,366
19,403,230
18,118,968
914,595
914,595
914,595
914,595
28,640,889
27,309,961
20,317,825
19,033,563
Total Non-Current Liabilities
Total Liabilities
Net Assets
Equity
Retained earnings
Reserves
Total Equity
22
Statement of Changes in Equity
2007 08
For the financial year ended 30 June 2008
CONSOLIDATED
COMPANY
Asset
revaluation
reserve
Retained
earnings
Total
attributable to
equity holders
of the entity
Asset
revaluation
reserve
Retained
earnings
Total
attributable to
equity holders
of the entity
$
$
$
$
$
$
Balance at 1 July 2006
- 23,089,455
23,089,455
-
16,587,372
16,587,372
Actuarial gain/(loss) on
defined benefit plans
-
217,013
217,013
-
217,013
217,013
Deferred tax relating to
-
(65,104)
(65,104)
-
(65,104)
(65,104)
Revaluation of land and
buildings
1,182,715
-
1,182,715
1,182,715
-
1,182,715
Transfer of realised gain
(80,000)
80,000
-
(80,000)
80,000
-
revaluation of property
(188,120)
-
(188,120)
(188,120)
-
(188,120)
Net income recognised
directly in equity
914,595
231,909
1,146,504
914,595
231,909
1,146,504
-
3,074,002
3,074,002
-
1,299,687
1,299,687
Total recognised income &
expense for the year
914,595
3,305,911
4,220,506
914,595
1,531,596
2,446,191
Balance at 30 June 2007
914,595 26,395,366
27,309,961
914,595
18,118,968
19,033,563
Profit for the year
Actuarial gain/(loss) on
-
(156,574)
(156,574)
-
(156,574)
(156,574)
-
46,972
46,972
-
46,972
46,972
Net income recognised
directly in equity
-
(109,602)
(109,602)
-
(109,602)
(109,602)
Profit for the year
-
1,440,531
1,440,531
-
1,393,864
1,393,864
Total recognised income &
expense for the year
-
1,330,928
1,330,928
-
1,284,262
1,284,262
914,595
27,726,294
28,640,889
914,595 19,403,230
20,317,825
23
Statement of Cash Flows
For the financial year ended 30 June 2008
CONSOLIDATED
2008
$
NOTES
COMPANY
2007
$
2008
$
2007
$
Cash flows from operating activities
Subscription income
Other income
Payments made to employees and suppliers
Interest received
8,831,299
8,332,777
8,831,299
8,332,777
15,645,948
14,772,314
15,645,948
14,772,314
(21,214,698)
(21,398,992)
(21,199,087)
(21,328,179)
1,555,043
2,046,418
65,124
25,896
258,270
-
-
-
(997,254)
(638,808)
(997,254)
(638,808)
4,078,608
3,113,709
2,346,030
1,164,000
7,150
601,084
7,150
601,084
14,967,153
2,827,653
-
-
Dividends received
Income tax paid
Net cash provided by operating activities
21
Cash flows from investing activities
Proceeds from sale of property,
plant and equipment
Proceeds from sale of investments
(1,050,607)
(1,394,982)
(1,050,607)
(1,394,982)
Investment in Associates
Payments for property, plant and equipment
(14,443,207)
-
-
-
Purchase of Investments
(2,157,323)
(3,804,719)
(40,000)
-
-
-
(1,076,226)
605,691
Net cash used in investing activities
(2,676,834)
(1,770,964)
(2,159,683)
(188,207)
Net increase/(decrease) in cash held
1,401,774
1,342,745
186,347
975,793
Cash at the beginning of the financial year
2,795,538
1,452,793
931,777
(44,016)
4,197,312
2,795,538
1,118,123
931,777
Provision of lending to related party
Cash at the end of the financial year
21
24
Notes to and forming part of the
Financial Statements
1. SUMMARY OF ACCOUNTING POLICIES
Significant Accounting Policies
Statement of Compliance
The following significant accounting policies have been adopted
in the preparation and presentation of the financial report:
The financial report is a general purpose financial report
which has been prepared in accordance with the Corporations
Act 2001, Accounting Standards, and complies with other
requirements of the law. Accounting Standards include Australian
equivalents to International Financial Reporting Standards
(‘A-IFRS’). Compliance with the A-IFRS ensures that the
consolidated financial statements and notes of the consolidated
entity comply with International Financial Reporting Standards
(‘IFRS’). The financial statements were authorised for issue by
the directors on 23 September 2008.
Basis of Preparation
The financial report has been prepared on the basis of historical
cost, except for the revaluation of certain non-current assets
and financial instruments. Cost is based on the fair values of
the consideration given in exchange for assets.
In the application of A-IFRS, management is required to make
judgments, estimates and assumptions about carrying values
of assets and liabilities that are not readily apparent from other
sources. The estimates and associated assumptions are based
on historical experience and various other factors that are
believed to be reasonable under the circumstances, the results
of which form the basis of making the judgments. Actual results
may differ from these estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis. Revisions to accounting estimates are recognised
in the period in which the estimate is revised if the revision
affects only that period, or in the period of the revision and future
periods if the revision affects both current and future periods.
Judgments made by management in the application of A-IFRS
that have significant effects on the financial statements and
estimates with a significant risk of material adjustments in the
next year are disclosed, where applicable, in the relevant notes
to the financial statements.
Accounting policies are selected and applied in a manner
which ensures that the resulting financial information satisfies
the concepts of relevance and reliability, thereby ensuring that
the substance of the underlying transactions or other events
is reported. 2007 08
(a) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand, cash in
banks and investments in money market instruments, net of
outstanding bank overdrafts.
(b) Principles of Consolidation
The consolidated Statement of Financial Position is prepared
by combining the Statements of Financial Position of all the
entities that comprise the consolidated entity, being The Royal
Automobile Club of Tasmania Limited (the company) and its
subsidiaries as defined in Accounting Standard AASB 127
‘Consolidated and Separate Financial Statements’. Consistent
accounting policies are employed in the preparation and
presentation of the consolidated Statement of Financial Position.
On acquisition, the assets, liabilities and contingent liabilities
of a subsidiary are measured at their fair values at the date of
acquisition. Any excess of the cost of acquisition over the fair
values of the identifiable net assets acquired is recognised as
Goodwill. If, after reassessment, the fair values of the identifiable
net assets acquired exceeds the cost of acquisition, the deficiency
is credited to Profit and Loss in the period of acquisition.
The consolidated Financial Statements include the information
and results of each subsidiary from the date on which the
company obtains control and until such time as the company
ceases to control such entity.
In preparing the consolidated Statement of Financial Position, all
intercompany balances and transactions, and unrealised profits
arising within the consolidated entity are eliminated in full.
(c) Income Tax
Current tax
Current tax is calculated by reference to the amount of income
taxes payable or recoverable in respect of the taxable profit
or tax loss for the period. It is calculated using tax rates and
tax laws that have been enacted or substantively enacted by
the reporting date. Current tax for current and prior periods is
recognised as a liability (or asset) to the extent that it is unpaid
(or refundable).
Deferred tax
Deferred tax is accounted for using the comprehensive Balance
Sheet liability method in respect of temporary differences
arising from differences between the carrying amount of assets
25
and liabilities in the Statement of Financial Position and the
corresponding tax base of those items.
In principle, deferred tax liabilities are recognised for all taxable
temporary differences. Deferred tax assets are recognised to
the extent that it is probable that sufficient taxable amounts
will be available against which deductible temporary
differences or unused tax losses and tax offsets can be utilised.
However, deferred tax assets and liabilities are not recognised
if the temporary differences giving rise to them arise from the
initial recognition of assets and liabilities (other than as a result
of a business combination) which affects neither taxable income
nor accounting profit. Furthermore, a deferred tax liability is not
recognised in relation to taxable temporary differences arising
from goodwill.
Deferred tax liabilities are recognised for taxable temporary
differences arising on investments in subsidiaries except where
the consolidated entity is able to control the reversal of the
temporary differences and it is probable that the temporary
differences will not reverse in the foreseeable future.
Deferred tax assets arising from deductible temporary
differences associated with these investments and interests
are only recognised to the extent that it is probable that there
will be sufficient taxable profits against which to utilise the
benefits of the temporary differences and they are expected
to reverse in the foreseeable future.
Deferred tax assets and liabilities are measured at the tax rates
that are expected to apply to the period(s) when the asset and
liability giving rise to them are realised or settled, based on tax
rates (and tax laws) that have been enacted or substantively
enacted by the reporting date. The measurement of deferred tax
liabilities and assets reflects the tax consequences that would
follow from the manner in which the consolidated entity expects,
at the reporting date, to recover or settle the carrying amount of
its assets and liabilities.
Deferred tax assets and liabilities are offset when they relate
to income taxes levied by the same taxation authority and the
company/consolidated entity intends to settle its current tax
assets and liabilities on a net basis.
Current and deferred tax for the period
Current and deferred tax is recognised as an expense or income
in the Statement of Financial Performance, except when it relates
to items credited or debited directly to equity, in which case the
deferred tax is also recognised directly in equity, or where it arises
from the initial accounting for a business combination, in which
case it is taken into account in the determination of goodwill.
26
Tax consolidation
The company and all its wholly-owned Australian resident entities
are part of a tax consolidated group under Australian taxation
law. The Royal Automobile Club of Tasmania Limited is the
head entity in the tax-consolidated group. Tax expense/income,
deferred tax liabilities and deferred tax assets arising from
temporary differences of the members of the tax-consolidated
group are recognised in the separate financial statements of
the members of the tax-consolidated group using the ‘separate
taxpayer within group’ approach. Current tax liabilities and
assets and deferred tax assets arising from unused tax losses
and tax credits of the members of the tax-consolidated group
are recognised by the company (as head entity in the taxconsolidated group).
Due to the existence of a tax funding arrangement between the
entities in the tax-consolidated group, amounts are recognised
as payable to or receivable by the company and each member
of the group in relation to the tax contribution amounts paid or
payable between the parent entity and the other members of
the tax-consolidated group in accordance with the arrangement.
Where the tax contribution amount recognised by each member
of the tax-consolidated group for a particular period is different
to the aggregate of the current tax liability or asset and any
deferred tax asset arising from unused tax losses and tax
credits in respect of that period, the difference is recognised
as a contribution from (or distribution to) equity participants.
(d) Goods and Services Tax
Revenues, expenses and assets are recognised net of the
amount of goods and services tax (GST), except:
i. where the amount of GST incurred is not recoverable from
the taxation authority, it is recognised as part of the cost of
acquisition of an asset or as part of an item of expense; or
ii. for receivables and payables which are recognised inclusive
of GST.
The net amount of GST recoverable from, or payable to, the
taxation authority is included as part of receivables or payables.
Cash flows are included in the Cash Flow Statement on a gross
basis. The GST component of cash flows arising from investing
and financing activities which is recoverable from, or payable to,
the taxation authority is classified as operating cash flows.
2007 08
(e) Property, Plant and Equipment
Property, plant and equipment and leasehold improvements are
stated at cost less accumulated depreciation and impairment.
Cost includes expenditure that is directly attributable to the
acquisition of the item. In the event that settlement of all or part
of the purchase consideration is deferred, cost is determined by
discounting the amounts payable in the future to their present
value as at the date of acquisition.
Depreciation is provided on property, plant and equipment,
including freehold buildings but excluding land. Depreciation is
calculated on a straight line basis so as to write off the net cost
or other revalued amount of each asset over its expected useful
life to its estimated residual value. Leasehold improvements are
depreciated over the period of the lease or estimated useful life,
whichever is the shorter, using the straight line method.
The estimated useful lives, residual values and depreciation
methods are reviewed at the end of each annual reporting period.
The following estimated useful lives are used in the calculation of
depreciation:
Plant & equipment Leasehold Improvements
Buildings
4 to 10 years
7 years
40 years
Revaluations of land and buildings
Any revaluation increment is credited to the asset revaluation
reserve included in the equity section of the Statement of Financial
Position, except to the extent that it reverses a revaluation
decrease of the same asset previously recognised in profit or loss,
in which case the increase is recognised in profit or loss.
Any revaluation decrease is recognised in profit or loss, except
to the extent that it offsets a previous revaluation increase for the
same asset, in which case the decrease is debited directly to
the asset revaluation reserve to the extent of the credit balance
existing in the revaluation reserve for that asset.
Additionally, any accumulated depreciation as at the revaluation
date is eliminated against gross carrying amounts of the assets
and the net amounts are restated to the revalued amounts of
the assets.
Upon disposal or derecognition, any revaluation reserve relating
to the particular asset being sold is transferred to retained
earnings.
Disposal
An item of property, plant and equipment is derecognised
upon disposal or when no further future economic benefits are
expected from its use or disposal.
Any gain or loss arising on derecognition of the asset (calculated
as the difference between the net disposal proceeds and the
carrying amount of the asset) is included in the profit or loss in
the year the asset is derecognised.
(f) Impairment of Assets
At each reporting date, the consolidated entity reviews the
carrying amounts of its tangible and intangible assets to
determine whether there is any indication that those assets
have suffered an impairment loss. If any such indication exists,
the recoverable amount of the asset is estimated in order to
determine the extent of the impairment loss (if any). Where the
asset does not generate cash flows that are independent from
other assets, the consolidated entity estimates the recoverable
amount of the cash-generating unit to which the asset belongs.
Goodwill, intangible assets with indefinite useful lives and
intangible assets not yet available for use are tested for
impairment annually and whenever there is an indication that
the asset may be impaired. An impairment of goodwill is not
subsequently reversed. Refer also to note 1(n).
Recoverable amount is the higher of fair value less costs to sell
and value in use. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset for which
the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit)
is estimated to be less than its carrying amount, the carrying
amount of the asset (cash-generating unit) is reduced to its
recoverable amount. An impairment loss is recognised in profit
or loss immediately.
Where an impairment loss subsequently reverses, the carrying
amount of the asset (cash-generating unit) is increased to the
revised estimate of its recoverable amount, but only to the extent
that the increased carrying amount does not exceed the carrying
amount that would have been determined had no impairment
loss been recognised for the asset (cash-generating unit) in prior
years. A reversal of an impairment loss is recognised in profit or
loss immediately.
27
(g) Inventories
(i) Payables
Inventories are valued at the lower of cost and net realisable
value. Net realisable value represents the estimated selling price
less all estimated costs of completion and costs to be incurred in
marketing, selling and distribution.
Trade payables and other accounts payable are recognised
(h) Financial Assets
Investments are recognised and derecognised on trade date
where purchase or sale of an investment is under a contract
whose terms require delivery of the investment within the
timeframe established by the market concerned, and are initially
recognised at cost, being the fair value of consideration given,
net of transaction costs.
Investments in subsidiaries are measured at cost.
payments resulting from the purchase of goods and services.
(j) Leased Assets
Leases are classified as finance leases whenever the terms
of the lease transfer substantially all the risks and rewards
of ownership to the lessee. All other leases are classified as
operating leases.
(k) Provisions
Provisions are recognised when the consolidated entity has a
present obligation, the future sacrifice of economic benefits is
Investment in associate is presented in note 1(m).
probable, and the amount of the provision can be measured
Investments and financial assets in the scope of AASB 139
Financial Instruments: Recognition and Measurement are
classified as either ‘financial assets at fair value through profit
and loss’, ‘held-to-maturity’ investments, and ‘loans and
receivables’. The classification depends on the nature and
purpose of the financial assets and is determined at the time
of initial recognition.
reliably.
Financial assets at fair value through profit or loss
Financial assets classified as held for trading are included in
the category “financial assets at fair value through profit or
loss”. Financial assets are classified as held for trading if they
are acquired for the purpose of selling in the near term with the
intention of making a profit. At balance date these investments
are adjusted for market value through profit and loss accounts.
When some or all of the economic benefits required to settle a
Held-to-maturity investments
Bills of exchange and debentures are recorded at amortised cost
using the effective interest method less impairment, with revenue
recognised on an effective yield basis.
Sale of goods and disposal of assets
The effective interest method is a method of calculating the
amortised cost of a financial asset and of allocating interest
income over the relevant period. The effective interest rate is
the rate that exactly discounts estimated future cash receipts
through the expected life of the financial asset, or, where
appropriate, a shorter period.
Loans and receivables
Trade receivables, which generally have 30-90 day terms
are recognised at fair value and subsequently measured at
amortised cost using the effective interest method, less an
allowance for any uncollectable amounts.
28
when the consolidated entity becomes obliged to make future
The amount recognised as a provision is the best estimate of
the consideration required to settle the present obligation at
reporting date, taking into account the risks and uncertainties
surrounding the obligation. Where a provision is measured using
the cashflows estimated to settle the present obligation, its
carrying amount is the present value of those cashflows.
provision are expected to be recovered from a third party, the
receivable is recognised as an asset if it is virtually certain that
recovery will be received and the amount of the receivable can
be measured reliably.
(l) Revenue recognition
Revenue from the sale of goods and disposal of other assets
is recognised when the consolidated entity has transferred to
the buyer the significant risks and rewards of ownership of
the goods.
Rendering of services
Revenue from a contract to provide services is recognised by
reference to the stage of completion of the contract.
Interest
Revenue is recognised (using the effective interest method,
which is the rate that exactly discounts estimated future cash
receipts through the expected life of the financial instrument)
to the net carrying amount of the financial asset as the
interest accrues.
2007 08
Dividends
Revenue is recognised when the company’s right to receive the
payment is established.
Commission income
Commission income is recognised when the right to receive
payment is established.
Subscriptions and recognition of contracts relating to
vehicle break-down services
Under A-IFRS, the accounting treatment for income and
expenditure relating to vehicle breakdown services is recognised
in accordance with AASB 4 Insurance Contracts.
The Company’s policy to comply with the requirements of
AASB 4 is to provide for unexpired subscriptions having regard
to the due dates of the subscriptions. This methodology has
been examined by the directors and the resulting financial
information presented complies with AASB 4. (m) Investment in Associate
The Group’s investment in its associate is accounted for using
the equity method of accounting in the consolidated financial
statements. The Group has significant influence over the associate.
Under the equity method, the investment in the associate entity
is carried in the consolidated Statement of Financial Position at
cost plus post -acquisition changes in the group’s share of net
assets of the entity. Goodwill relating to the associate entity is
included in the carrying amount of the investment and is not
amortised. After application of the equity method, the Group
determines whether it is necessary to recognise any additional
impairment loss with respect to the Group’s net investment in
the associate entity. The consolidated Statement of Financial
Performance reflects the Group’s share of the results of the
operations of the associate entity.
Where there has been a change in the associate entity’s equity,
the Group recognises its share of any changes and discloses this
in the consolidated Statement of Financial Performance.
The reporting dates of the associate entity and the Group are
identical and the entity’s accounting policies conform to those
used by the Group for like transactions and events in similar
circumstances.
(n) Goodwill
Goodwill acquired in a business combination is initially measured
at cost being the excess of the cost of the business combination
over the Group’s interest in the fair value of the acquiree’s
identifiable assets, liabilities and contingent liabilities.
Following initial recognition, goodwill is measured at cost less
any accumulated impairment losses.
For the purpose of impairment testing, goodwill acquired in a
business combination is, from the acquistion date, allocated
to each of the Group’s cash-generating units, or groups of
cash-generating units, that are expected to benefit from the
synergies of the combination, irrespective of whether other
assets or liabilities of the Group are assigned to those units or
groups of units. Each unit or group of units to which goodwill is
so allocated:
- represents the lowest level within the Group at which goodwill
is monitored for internal management purposes; and
- is not larger than a segment based on either the Group’s
primary or the Group’s secondary reporting format determined
in accordance with AASB 114 Segment Reporting.
Impairment is determined by assessing the recoverable amount
of the cash-generating unit (group of cash-generating units),
to which the goodwill relates. When the recoverable amount of
the cash-generating unit (group of cash-generating units) is less
than the carrying amount, an impairment loss is recognised.
When goodwill forms part of a cash-generating unit (group
of cash-generating units) and an operation within that unit is
disposed of, the goodwill associated with the operation disposed
of is included in the carrying amount of the operation when
determing the gain or loss on disposal of the operation.
Goodwill disposed of in this manner is measured based on
the relative values of the operation disposed of and the portion
of the cash - generating unit retained.
Impairment losses recognised for goodwill are not subsequently
reversed.
(o) Employee benefits
Provision is made for benefits accruing to employees in respect
of wages and salaries, annual leave and long service leave
when it is probable that settlement will be required and they are
capable of being measured reliably.
Provisions made in respect of employee benefits expected to be
settled within 12 months, are measured at their nominal values
using the remuneration rate expected to apply at the time of
settlement.
Provisions made in respect of employee benefits which are not
expected to be settled within 12 months are measured at the
present value of the estimated future cash outflows to be made
by the consolidated entity in respect of services provided by
employees up to reporting date.
29
Defined contribution plans
Contributions to defined contribution superannuation plans are
expensed when incurred.
Defined benefit plans
For defined benefit superannuation plans, the cost of providing
benefits is determined using the Projected Unit Credit Method,
with actuarial calculations being carried out at each reporting
date. Actuarial gains and losses are recognised in full, directly
in retained earnings, in the period in which they occur, and are
presented in the Statement of Changes in Equity.
30
Past service cost is recognised immediately to the extent that
the benefits are already vested, otherwise is amortised on a
straight-line basis over the average period until the benefits
become vested.
The defined benefit obligation recognised in the Statement of
Financial Position represents the present value of the defined
benefit obligation, adjusted for unrecognised past service cost,
net of the fair value of the plan assets. Any asset resulting from this
calculation is limited to past service cost, plus the present value of
available refunds and reductions in future contributions to the plan.
2007 08
2. REVENUE
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
Interest from other bodies corporate
190,333
339,079
65,124
25,896
434,493
1,859,426
-
-
39,570
35,718
39,570
35,718
8,518,146
7,955,434
8,518,146
7,955,434
Revenue consisted of the following items
(a) Revenue
Distributions from funds under management
Rental revenue
Membership subscriptions and entrance fees
Other services and activities
12,416,930
11,952,559
12,446,930
11,982,559
Commission & other income
470,940
412,843
470,940
412,843
Realised gains/(loss) on investment
(364,248)
94,452
-
-
Dividends
258,270
-
-
-
21,964,434
22,649,511
21,540,710
20,412,450
518,134
-
-
-
518,134
-
-
-
(21,601)
151,325
(21,601)
151,325
(b) Share of profit of associate
Share of profit of associate
(c) Other Revenue
Gain/(loss) on disposal of property, plant and equipment
Unrealised gain/(loss) on investments
(971,269)
365,229
-
-
(992,870)
516,554
(21,601)
151,325
21,489,698
23,166,065
21,519,109
20,563,775
Profit before income tax has been arrived at after charging
the following expenses and losses from operations:
(d) Expenses
Depreciation and amortisation of non-current assets:
Plant & equipment
848,184
875,848
848,184
875,848
Buildings
57,822
64,017
57,822
64,017
Software
147,982
144,951
147,982
144,951
1,053,988
1,084,816
1,053,988
1,084,816
6,196
2,119
6,196
2,119
Employee benefits
193,536
111,291
193,536
111,291
Unexpired subscriptions
317,007
385,517
317,007
385,517
510,543
496,808
510,543
496,808
Bad debts written off
Transfer to provisions for:
31
3. INCOME TAX EXPENSE
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
Current Tax
358,215
642,882
(12,833)
-
Deferred Tax
(471,093)
(106,240)
(63,760)
(251,690)
(68,657)
103,219
(4,292)
102,833
(181,535)
639,861
(80,885)
(148,857)
377,699
1,114,159
393,895
345,250
(1,202)
(73,684)
-
(68,183)
Mutual profits
(358,475)
(142,868)
(358,475)
(142,868)
Non mutual deductions
(132,566)
(159,062)
(132,566)
(159,062)
20,514
13,487
20,514
11,963
(28,040)
-
-
-
(a) Income Tax Expense
The components of tax expense comprise:
Under/(over) provision from previous years
(b) Numerical reconciliation of income tax expense to
prima facie tax payable
Prima facie tax on profit/(loss) before income tax at 30%
(2007:30%)
Add tax effect of:
Non assessable income
Non deductable expenses
Tax Credits
Other
Under/(over) provision from previous years
Total
-
(112,171)
-
(135,957)
(59,465)
-
(4,252)
-
(181,535)
639,861
(80,885)
(148,857)
(c) Deferred tax recognised directly to equity
Relating to revaluation of property
-
(188,120)
-
(188,120)
(46,972)
(65,104)
(46,972)
(65,104)
(46,972)
(253,224)
(46,972)
(253,224)
Current tax receivable
145,434
-
145,434
-
Deferred tax assets
221,157
106,757
221,157
98,898
TOTAL
366,591
106,757
366,591
98,898
-
562,262
-
562,262
Deferred tax liability
642,473
1,046,136
476,821
465,294
TOTAL
642,473
1,608,398
476,821
1,027,556
Relating to defined benefits
(d) Current and Deferred tax balances
Assets
Current/Non-current
Liabilities
Current/Non-current
Current tax liability
32
2007 08
3. INCOME TAX EXPENSE (continued)
Taxable and deductible temporary differences arise from the following:
Consolidated
Opening
balance
Credited/
(charged)
to income
Credited/
(charged)
to equity
Closing
balance
$
$
$
$
(158,613)
(230,905)
-
(389,518)
Accrued income
-
(5,654)
-
(5,654)
Prepayments
-
(27,872)
-
(27,872)
Investment in associate
-
(155,441)
-
(155,441)
Defined benefit funds
-
(106,402)
46,972
(59,430)
(887,523)
882,965
-
(4,558)
(1,046,136)
356,691
46,972
(642,473)
2008
Gross deferred tax liabilities:
Property,plant & equipment
Investments
Gross deferred tax assets:
Receivables
3,675
825
-
4,500
(285,724)
285,724
-
-
92,864
121,277
-
214,141
Investments
306,677
(306,677)
-
-
Tax losses
(20,953)
20,953
-
-
Property, plant & equipment
Provisions
Other
10,218
(7,702)
-
2,516
106,757
114,400
-
221,157
(939,379)
471,093
46,972
(421,314)
Consolidated
Opening
balance
Credited/
(charged)
to income
Credited/
(charged)
to equity
Closing
balance
$
$
$
$
(383,157)
412,664
(188,120)
(158,613)
Investments
(790,853)
(96,670)
-
(887,523)
(1,174,010)
315,994
(188,120)
(1,046,136)
Receivables
3,675
-
-
3,675
4,088
(289,812)
-
(285,724)
65,916
103,553
(76,605)
92,864
306,677
-
-
306,677
-
-
(20,953)
(20,953)
2007
Provisions
Investments
Tax losses
Other
1,258
8,960
-
10,218
381,614
(177,299)
(97,558)
106,757
(792,396)
138,695
(285,678)
(939,379)
33
3. INCOME TAX EXPENSE (continued)
Company
2008
Opening
balance
Credited/
(charged)
to income
Credited/
(charged)
to equity
Closing
balance
$
$
$
$
(444,341)
54,822
-
(389,519)
Defined benefits fund
Prepayments
-
(106,402)
46,972
(59,430)
(20,953)
(6,919)
-
(27,872)
(465,294)
(58,499)
46,972
(476,821)
3,675
825
-
4,500
92,864
121,277
-
214,141
2,359
157
-
2,516
98,898
122,259
-
221,157
(366,396)
63,760
46,972
(255,664)
Opening
balance
Credited/
(charged)
to income
Credited/
(charged)
to equity
Closing
balance
$
$
$
$
(383,156)
126,935
(188,120)
(444,341)
-
-
(20,953)
(20,953)
(383,156)
126,935
(209,073)
(465,294)
-
3,675
Receivables
Provisions
Other
Company
2007
Prepayments
Receivables
3,675
-
4,088
(4,088)
65,916
92,052
(65,104)
92,864
1,258
1,101
-
2,359
74,937
89,065
(65,104)
98,898
(308,219)
216,000
(274,177)
(366,396)
Provisions
Other
34
-
2007 08
4. REMUNERATION OF AUDITORS
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
23,600
22,700
23,600
22,700
8,403
7,175
8,403
7,175
32,003
29,875
32,003
29,875
1,087,437
2,467,320
817,530
1,267,194
(15,000)
(15,000)
(15,000)
(15,000)
1,072,437
2,452,320
802,530
1,252,194
776,297
969,563
776,297
969,563
1,848,734
3,421,883
1,578,827
2,221,757
15,000
15,000
15,000
15,000
Charge for the year
6,196
2,119
6,196
2,119
Amounts written off
(6,196)
(2,119)
(6,196)
(2,119)
At 30 June
15,000
15,000
15,000
15,000
Audit of the financial report
Other non-audit services
5. RECEIVABLES
Trade and Other Receivables
Trade receivables / sundry debtors
Allowance of impairment loss / doubtful debtors (a)
Related party receivables: (b)
Associates - (Receivable from RACT Insurance Pty Ltd
(unsecured))
Carrying amount of trade and other receivables
(a) Allowance for impairment loss
Trade receivables are not interest bearing and are generally on
30-90 day terms. A provision for impairment loss is
recognised when there is objective evidence that an individual
trade receivable is impaired. An impairment loss of $15,000
(2007 - $15,000) has been recognised by the group and
$15,000 (2007 - $15,000) by the company in the current year.
Movement in the provision for impairment loss were as follows:
At 1 July
35
5. RECEIVABLES (continued)
At 30 June, the ageing analysis of trade receivables is as follows:
Total
0-30 days
31-60 days
61-90 days
+ 91 days
PDNI*
+ 91 days
CI*
1,087,437
456,701
93,542
33,453
488,741
15,000
2008
Consolidated
817,530
186,795
93,542
33,453
488,741
15,000
2007
Consolidated
2,467,320
1,961,444
54,342
61,954
374,580
15,000
Parent
1,267,194
761,318
54,342
61,954
374,580
15,000
Parent
* Past due not impaired (PDNI*)
* Considered Impaired (CI*)
Receivables greater than 90 days include the consolidated entity’s direct debt control balance. This balance covers a continually
rolling 12 month direct debit period.
Receivables past due but not considered impaired are: Consolidated $488,741 (2007 $374,580); Parent $488,741 (2007
$374,580).
Payment terms on these amounts have not been re-negotiated, each operating unit has been in direct contact with the relevant
debtor and is satisfied that payment will be received in full.
Other balances within trade and other receivables do not contain impaired assets and are not past due. It is expected that these
other balances will be received when due.
(b) Fair value and credit risk
Due to the short term nature of these receivables, their carrying value is assumed to approximate their fair value.
The maximum exposure to credit risk is the fair value of receivables. Collateral is not held as security, nor is it the Groups policy to
transfer (on-sell) receivables to special purpose entities.
6. OTHER FINANCIAL ASSETS
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
-
-
16,511,153
15,128,243
Term Deposits (ii)
2,000,000
3,300,000
-
-
(i) Loans to controlled entities are interest free and repayable
at call.
2,000,000
3,300,000
16,511,153
15,128,243
-
-
10,001
10,001
(a) Current
Loan to controlled entities (unsecured) (i)
(b) Non-current
Shares in controlled entities (at cost)
3,684,832
14,162,501
-
-
Floating Rate Notes (ii)
Unit trusts (ii)
500,000
3,000,000
-
-
Equities (ii)
434,803
459,803
-
-
4,619,635
17,622,304
10,001
10,001
(ii) Designated as a financial asset at fair value through profit and
loss from 1 July 2004.
36
2007 08
7. INVESTMENT IN ASSOCIATE
CONSOLIDATED
2008
$
2007
$
RACT Insurance Pty Ltd
14,961,341
-
Investments in associate
14,961,341
-
14,443,207
-
518,134
-
14,961,341
-
RACT Holdings Pty Ltd has held shares as part of a joint venture
in RACT Insurance Pty Ltd since 1 September 2007 RACT
Insurance Pty Ltd is incorporated in Australia and provides
general insurance products that are distributed by The Royal
Automobile Club of Tasmania Ltd.
(a) Investment details:
(b)Movements in the carrying amount of the Group’s
investment in associates
At 1 September 2007
Share of profits
At 30 June 2008
(c) Summarised financial information:
The following table illustrates summarised financial information
relating to the Group’s associates:
Extract from the associates’ balance sheets:
Current assets
33,113,049
-
Non-current assets
24,067,186
-
57,180,235
-
44,456,954
-
(63,219)
-
44,393,735
-
12,786,500
-
Current liabilities
Non-current liabilities
Net assets
(d) Extract from Associates Income Statement
Revenue
49,100,522
-
Net Profit
2,208,083
-
37
8. INTANGIBLES
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
1,170,169
1,130,169
1,170,169
1,130,169
1,170,169
1,130,169
1,170,169
1,130,169
455,321
307,596
455,321
307,596
Additions
-
126,106
-
126,106
Transfers
-
166,570
-
166,570
(147,982)
(144,951)
(147,982)
(144,951)
307,339
455,321
307,339
455,321
1,477,508
1,585,490
1,477,508
1,585,490
127,237
133,051
127,237
133,051
127,237
133,051
127,237
133,051
236,784
241,943
236,784
241,943
34,355
37,321
34,355
37,321
271,139
279,264
271,139
279,264
198,101
399,666
198,101
399,666
198,101
399,666
198,101
399,666
(a) Goodwill on travel business
(b) Computer software:
Opening balance
Amortisation expense
Closing balance
9. INVENTORIES
At cost
Finished goods
10. OTHER ASSETS
(a) Current
Prepayments
Accrued revenue
(b) Non-current
Net asset arising from defined benefit obligations
38
2007 08
11. PROPERTY, PLANT AND EQUIPMENT
Consolidated 2008
Freehold
Land
(fair value)
$
Buildings
( fair value)
$
Plant and
Equipment
(cost)
$
TOTAL
$
2,462,055
2,473,641
9,670,500
14,606,196
Additions
-
117,323
1,211,914
1,329,237
Disposals
-
(98,498)
(402,868)
(501,366)
2,462,055
2,492,466
10,479,546
15,434,067
-
138,460
7,039,596
7,178,056
Disposals
-
-
(311,318)
(311,318)
Depreciation expense
-
57,822
848,184
906,006
-
196,282
7,576,462
7,772,744
2,462,055
2,473,641
9,670,500
14,606,196
-
(138,460)
(7,039,596)
(7,178,056)
2,462,055
2,335,181
2,630,904
7,428,140
2,462,055
2,492,466
10,479,546
15,434,067
-
(196,282)
(7,576,462)
(7,772,744)
2,462,055
2,296,184
2,903,084
7,661,325
Gross Carrying Amount
Accumulated Depreciation
Net Book Value
As at 1 July 2007
Accumulated depreciation
Net carrying amount
As at 30 June 2008
Cost / fair value
Net carrying amount
39
(continued)
Company 2008
Freehold
Land
(fair value)
$
Buildings
( fair value)
$
Plant and
Equipment
(cost)
$
TOTAL
$
2,462,055
2,473,641
9,670,500
14,606,196
Additions
-
-
1,211,914
1,211,914
Disposals
-
(98,498)
(402,868)
(501,366)
2,462,055
2,375,143
10,479,546
15,316,744
-
138,460
7,039,596
7,178,056
Disposals
-
-
(311,318)
(311,318)
-
57,822
848,184
906,006
-
196,282
7,576,462
7,772,744
2,462,055
2,473,641
9,670,500
14,606,196
-
(138,460)
(7,039,596)
(7,178,056)
2,462,055
2,335,181
2,630,904
7,428,140
2,462,055
2,375,143
10,479,546
15,316,744
0
(196,282)
(7,576,462)
(7,772,744)
2,462,055
2,178,861
2,903,084
7,544,000
Net Book Value
As at 1 July 2007
Net carrying amount
As at 30 June 2008
Cost / fair value
Net carrying amount
40
2007 08
(continued)
Consolidated & Company 2007
Freehold
Land
(fair value)
$
1,590,000
Buildings
( fair value)
$
Plant and
Equipment
(cost)
$
TOTAL
$
2,434,553
8,954,209
12,978,762
Additions
-
119,273
983,030
1,102,303
Disposals
(150,450)
(160,395)
(99,989)
(410,834)
Transfers
-
-
(166,750)
(166,750)
1,102,505
80,210
-
1,182,715
(80,000)
-
-
(80,000)
2,462,055
2,473,641
9,670,500
14,606,196
-
108,811
6,257,205
6,366,016
Disposals
-
(34,368)
(93,457)
(127,825)
Revaluation Land and Buildings
Transfer of Realised Gain
-
64,017
875,848
939,865
-
138,460
7,039,596
7,178,056
1,590,000
2,434,553
8,954,209
12,978,762
-
(108,811)
(6,257,205)
(6,366,016)
Net carrying amount
1,590,000
2,325,742
2,697,004
6,612,746
As at 30 June 2007
2,462,055
2,473,641
9,670,500
14,606,196
-
(138,460)
(7,039,596)
(7,178,056)
2,462,055
2,335,181
2,630,904
7,428,140
Net Book Value
As at 1 July 2006
Net carrying amount
12. PAYABLES
Sundry creditors and accrued expenses
GST payable
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
2,517,797
2,539,222
2,476,739
2,538,391
231,580
268,352
235,112
270,617
2,749,377
2,807,574
2,711,851
2,809,008
41
13. PROVISIONS (CURRENT)
Unexpired subscriptions
Employee benefits
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
4,582,492
4,265,481
4,582,492
4,265,481
800,228
817,239
800,228
817,239
5,382,720
5,082,720
5,382,720
5,082,720
14. PROVISIONS (NON-CURRENT)
Employee benefits
313,464
263,440
313,464
263,440
313,464
263,440
313,464
263,440
The provisions disclosed in notes 13 & 14 represent the following:
(a) The provision for unexpired subscriptions represents the unearned portion of amounts for Roadside membership.
(b) The provision for employee benefits represents amounts for annual leave and long service leave benefits.
15. OWNERSHIP
The Company is incorporated under the Corporations Act 2001 as a company limited by the guarantee of the members. If the
company is wound up, its Constitution states that each member is required to contribute a maximum of $6.30 towards any
outstanding obligations of the company. As at 30 June 2008, the number of members was 108,918 (2007 - 106,600).
16. RELATED PARTY DISCLOSURES
(a) Transactions between directors and director-related entities are on normal commercial terms and conditions no more
favourable than those available to other parties unless otherwise stated.
The directors may obtain discounted services from the consolidated entity. These services are obtained on the same terms and
conditions as those obtained by employees of the consolidated entity.
(b) Shadforths Ltd, of which Mr D Catchpole, a Director of the company, is the Chairman - Board of Advice, currently manages the
RACT Pty Ltd growth investment portfolio. All transactions between the two entities are undertaken on a normal commercial basis.
(c) Butler McIntyre & Butler, of which Mr P Joyce, a Director of the company, is a Partner, provides legal advice to the RACT group
as and when required. All transactions between the two entities are undertaken on a normal commercial basis.
CONSOLIDATED
(d) Loan to RACT Pty Ltd
2008
$
2007
$
2008
$
2007
$
-
-
16,511,153
15,128,243
The loan is secured over the assets of RACT Pty Ltd and does
not attract interest.
(e) The names of directors who have held office during the financial year are:
Ms J M Archer
Mr P A Dixon
Mr R S Locke
Mr E C Best, AM, JP
Mr R H Holmes
Mr S E Slade
Mr J R Bloomfield JP
Mr P J Joyce
Mr A C Stacey AM
Mr D M Catchpole
Mr C J Langdon
Mrs K A Westwood
Mr B F Clark
(f) The Royal Automobile Club of Tasmania Limited is the ultimate parent entity.
42
COMPANY
2007 08
17. KEY MANAGEMENT PERSONNEL
COMPENSATION
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
111,308
64,409
111,308
64,409
The aggregate compensation of the key management personnel
of the consolidated entity and the company is set out below:
(a) Total remuneration for Directors:
(b) The number of directors of the consolidated entity whose remuneration (including superannuation contributions)
fell within the following bands are:
$0 - $9,999
8
11
8
11
$10,000 - $19,999
5
1
5
1
13
12
13
12
1,517,114
1,468,890
1,517,114
1,468,890
1,517,114
1,468,890
1,517,114
1,468,890
(c) Remuneration for key management personnel as listed:
(a) Short term employee benefits
Key management personnel:
Mr G Goodman - Group Chief Executive
Mr H Lennon - Chief Operating Officer
Mr I Kelly - Chief Information Officer
Mr C Petterwood - General Manager Sales & Distribution
Ms L Shephard - Human Resources Manager
Ms R Sinfield - General Manager Travel
Ms J Dew - Financial Controller
Mr D Moody - General Manager, Roadside & Technical Services
(from 11 Dec 07)
Mr V Taskunas - Public Policy and Communications
(from 21 Jan 08)
Mr D Ling - Chief Engineer (until 30 Nov 07)
Mr D Rose - Group Manager, Marketing & Communications
(until 14 Sep 07)
18. DETAILS OF CONTROLLED ENTITIES
The following entities constitute The Royal Automobile Club of Tasmania Limited Group:
PERCENTAGE OF SHARES HELD
2008
2007
-
-
RACT Pty Ltd (ii)
100
100
RACT Holdings Pty Ltd (ii)
100
100
Parent entity
The Royal Automobile Club of Tasmania Limited (i)
Controlled entities
RACT Holdings Pty Ltd is 50% owned by RACT Pty Ltd and 50% owned by The Royal Automobile Club of Tasmania Limited. The
shares in the Financial Statements of RACT Pty Ltd and The Royal Automobile Club of Tasmania Limited are recorded at $1.00 each.
All companies are incorporated in Australia.
(i) The Royal Automobile Club of Tasmania Limited is the head entity within the tax consolidated group.
(ii) These companies are members of the tax consolidated group.
43
19. SEGMENT INFORMATION
The consolidated entity exists primarily to provide services to members. It operates in two industry sectors, the operations for each
being summarised in the following table:
External Sales
Inter-segment
Segment Revenues
2008
$’000
2007
$’000
2008
$’000
2007
$’000
2008
$’000
Total
2007
$’000
Member services
17,498
16,712
-
-
17,498
16,712
Travel
3,908
3,608
106
90
4,014
3,698
21,512
20,410
(106)
(90)
Total of all Segments
Eliminations
Unallocated
Consolidated
83
2,846
21,489
23,166
1,896
1,796
Segment Results
Member services
19
(337)
Travel
1,915
1,459
Unallocated
(656)
2,255
Profit before income tax
1,259
3,714
182
(640)
1,441
3,074
Income tax expense
Net Profit
Assets
Liabilities
Segment Asset & Liabilities
2008
$’000
2007
$’000
2008
$’000
2007
$’000
Member services
27,422
26,044
7,725
7,612
Travel
2,146
2,163
720
541
29,568
28,207
8,445
8,153
Eliminations
-
-
-
-
Unallocated
8,015
8,865
497
1,609
37,583
37,072
8,942
9,762
Consolidated
Member Services
Travel
Other Segment Information
2008
$’000
2007
$’000
2008
$’000
2007
$’000
Acquisition of segment assets
1,329
1,160
-
70
Depreciation and amortisation of segment assets
1,006
1,042
48
42
150
72
43
39
Other non-cash expenses
The consolidated entity operates in the single geographic area of Tasmania.
For management purposes, the consolidated entity is organised into two operating divisions - Membership and Travel. The principal
products and services of each of these divisions are as follows:
44
Membership
Services provided to members such as roadside help and vehicle inspection.
Travel
Domestic and international travel services for customers.
2007 08
20. Defined Benefit Superannuation Plans
The defined benefit sub-fund is a funded plan. Quadrant
Superannuation Pty Ltd computes its obligations in respect of
the sub-fund in accordance with Accounting Standard AAS 25
Financial Reporting by Superannuation Plans which prescribes
a different measurement basis to that applied in this financial
report. The net surplus of assets over members’ vested benefits
as determined in the Scheme’s most recent financial report as
at 30 June 2007 was $426,000 (2006: $264,000). The
most recent actuarial investigation into the sub-fund was carried
Up to 30 June 2003, the consolidated entity participated in a
out as at 30 June 2005 by David Quinn-Watson BSc(Hons)
stand-alone employer-sponsored fund which provided benefits
FIAA of Bendzulla Actuarial Pty Ltd. The next actuarial review
to employees of entities in the Consolidated RACT Group on
is due as at 30 June 2008, and is expected to be completed
retirement, death or disability. On 30 June 2003, all assets and
early in 2009. The actuary has not recommended that
liabilities of the stand-alone fund were transferred to the Quadrant
employer contributions beyond the current contribution level
Superannuation Scheme which is a multi-employer superannuation
be made. Funding recommendations are made by the actuary
fund under the trusteeship of Quadrant Superannuation Pty
based on a target funding approach referencing the members’
Ltd. The transfer was effected on a successor fund basis with
vested benefits.
the defined benefit component being established as a subThe consolidated entity has a legal liability to make up a deficit
fund of the Quadrant Superannuation Scheme (the RACT Staff
Superannuation Scheme Benefits Fund). However, there remains in the sub-fund but no legal right to use any surplus in the subfund to further its own interests.
a legally enforceable obligation on the company to make up any
deficiency in the sub-fund.
The consolidated entity provides defined benefit superannuation
arrangements for employees who elected to take this option
prior to 30 June 1997 when the arrangements were closed to
new members. Under the defined benefit arrangements, the
employees are entitled to retirement benefits varying between
15% and 20% of final average salary for each year of service.
The consolidated entity contributes to defined contribution plans
for other employees.
CONSOLIDATED
2008
$
2007
$
Discount rate gross of tax
6.50%
6.25%
Discount rate net of tax
5.50%
5.30%
Expected return on plan assets
6.35%
6.35%
Key assumptions used (expressed as weighted averages):
Expected rate(s) of salary increase
Expected return on reimbursement rights
Tax on employer contributions
4.00%
4.00%
equal to
discount rate
equal to
discount rate
15%
15%
45
20. DEFINED BENEFIT SUPERANNUATION
PLANS (continued)
CONSOLIDATED
2008
$
COMPANY
2007
$
2008
$
2007
$
Amounts recognised in income in respect of these defined benefit plans are as follows:
Current service cost
110,555
79,640
110,555
79,640
Interest cost
114,056
102,122
114,056
102,122
(130,347)
(146,504)
(130,347)
(146,504)
94,264
35,258
94,264
35,258
156,574
(217,013)
156,574
(217,013)
Total, included in superannuation expense/(income)
Actuarial losses/(gains) incurred during the year and recognised
in the Statement of Changes in Equity
The amount included in the Statement of Financial Position arising from the entity’s obligations in respect of its defined
benefit plans is as follows:
Present value of funded defined benefit obligations
Fair value of plan assets
Net liability/(asset) arising from defined benefit obligations
1,161,818
2,272,889
1,161,818
2,272,889
(1,359,919)
(2,672,555)
(1,359,919)
(2,672,555)
(198,101)
(399,666)
(198,101)
(399,666)
(198,101)
(399,666)
(198,101)
(399,666)
(290)
(370)
(290)
(370)
(198,391)
(400,036)
(198,391)
(400,036)
Included in the Statement of Financial Position:
Current provision for employee benefits
Defined benefit obligations
Net liability / (asset) arising from defined benefit obligations
Movements in the present value of the defined benefit obligations in the current period were as follows:
Opening defined benefit obligation
2,272,889
2,126,517
2,272,889
2,126,517
Current service cost
110,555
79,640
110,555
79,640
Interest cost
114,056
102,122
114,056
102,122
4,757
12,540
4,757
12,540
(46,712)
(34,415)
(46,712)
(34,415)
(1,293,727)
(13,515)
(1,293,727)
(13,515)
1,161,818
2,272,889
1,161,818
2,272,889
Contributions from plan participants
Actuarial losses/(gains)
Benefits paid
Closing defined benefit obligation
Movements in the present value of the plan assets in the current period were as follows:
Opening fair value of plan assets
Actuarial gains/(losses)
Contributions from the employer
Contributions from plan participants
Benefits and tax paid
Closing fair value of plan assets
46
2,672,555
2,270,832
2,672,555
2,270,832
130,347
146,504
130,347
146,504
(203,286)
182,598
(203,286)
182,598
49,273
73,596
49,273
73,596
4,757
12,540
4,757
12,540
(1,293,727)
(13,515)
(1,293,727)
(13,515)
1,359,919
2,672,555
1,359,919
2,672,555
2007 08
20. DEFINED BENEFIT SUPERANNUATION PLANS (continued)
The consolidated entity expects to continue to make contributions at the rate of 1.5 times employee contributions to the defined
benefit plan during the next financial year. The level of contribution has been determined based on actuarial advice.
The overall expected rate of return is a weighted average of the expected returns of the various categories of plan assets held.
Decisions regarding the allocation of funds to various classes of assets are made by the trustee, Quadrant Superannuation Pty Ltd. The
Directors’ assessment of the expected returns is based on actuarial advice as described above. For the year ending 30 June 2008, the
Actuary has assumed a rate of return of 6.35% pa net of tax, investment management expenses and the fund’s administration charges.
CONSOLIDATED
2008
$
COMPANY
2007
$
2008
$
2007
$
The history of experience adjustments is as follows:
Experience adjustments on plan liabilities
Experience adjustments on plan assets
37,517
(2,849)
37,517
(2,849)
(203,286)
182,599
(203,286)
182,599
21. NOTES TO THE CASH FLOW STATEMENT
(a) Reconciliation of Cash
For the purpose of this Cash Flow Statement, cash includes cash on hand and in banks, net of outstanding bank overdrafts.
Cash at the end of the financial year as shown in the Cash Flow Statement is reconciled to the related items in the Statement of
Financial Position:
Cash on hand
15,624
13,724
15,624
13,724
Cash at bank
3,944,870
2,691,710
865,6812
827,949
Bank overdraft - secured
236,818
90,104
236,818
90,104
4,197,312
2,795,538
1,118,124
931,777
(b) Financing Facilities
A bank overdraft facility secured over the freehold property of the company is maintained to meet short term cash requirements. The
facility was not drawn against as at the balance date and any reference to bank overdraft relates to cheques unpresented at that date.
Facility amount
150,000
200,000
150,000
200,000
(c) Reconciliation of Profit After Related Income Tax to Net Cash Flows From Operating Activities
Profit after related income tax
1,440,531
3,074,002
1,393,864
1,299,687
1,053,977
1,084,816
1,053,977
1,084,816
21,600
(151,325)
21,600
(151,325)
Non cash flows in operating profit
Depreciation
Net loss/(profit) on sale of property plant & equipment
Unrealised (gain)/loss on investments
453,134
(365,229)
-
-
Change in provision for unexpired subscriptions in advance
317,008
385,517
317,008
385,517
Realised (gain)/loss on investments
364,248
(94,453)
-
-
47
21. NOTES TO THE CASH FLOW STATEMENT
(continued)
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
Provision for employee entitlements
33,015
50,207
33,015
50,207
(Increase)/decrease in prepayments
449,665
(702,350)
449,665
(702,350)
(Increase)/decrease in receivables
Changes in assets and liabilities
816,799
(1,495,284)
(113,418)
(1,341,858)
(Increase)/decrease in stock
5,814
(31,174)
5,814
(31,174)
Increase/(decrease) in other assets
8,124
115,855
8,124
115,855
248,899
(303,674)
207,850
(303,460)
(Increase)/decrease in deferred tax assets
(114,400)
(23,961)
(122,259)
(23,961)
Increase/(decrease) in deferred tax liabilities
(403,664)
562,262
11,527
562,262
46,972
(253,224)
46,972
(253,224)
Increase/(decrease) in tax payable
(401,013)
870,854
(707,696)
82,138
(Increase)/decrease in provisions
(225,343)
337,312
(224,510)
337,312
(36,758)
53,558
(35,504)
53,558
4,078,608
3,113,709
2,346,030
1,164,000
17,100
162,660
17,100
162,660
Due not later than one year
267,017
247,424
267,017
247,424
Due later than one but not later than two years
255,145
250,875
255,145
250,875
Due later than two but not later than five years
366,395
412,478
366,395
412,478
87,822
-
87,822
-
Increase/(decrease) in trade creditors
Increase/(decrease) in tax effect entries taken directly to
equiity
Increase/(decrease) in GST payable
Cash flows from operations
22.CAPITAL COMMITMENTS
Capital expenditure commitments contracted for plant and equipment:
Payable not later than one year
23. OPERATING LEASE COMMITMENTS
Due later than five years
Operating lease commitments relate to shop front leases with lease terms between three to six years.
24. EMPLOYEE BENEFITS
The aggregate employee benefits liability recognised and included in the financial statements is as follows:
Provision for Employee benefits
Current
800,228
817,239
800,228
817,239
Non-current
313,464
263,440
313,464
263,440
1,113,692
1,080,679
1,113,692
1,080,679
88,671
104,003
88,671
104,003
Salaries Paid in advance
48
2007 08
24. EMPLOYEE BENEFITS (continued)
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
1,080,679
1,030,472
1,080,679
1,030,472
33,013
50,206
33,013
50,206
1,113,692
1,080,678
1,113,692
1,080,678
2008
2007
2008
2007
172
175
172
175
NonInterest
Bearing
$
Total
$
Details of change in provision for employee benefits
Balance at 1 July - beginning
Net movement in provisions
Balance at 30 June - ending
Number of employees at end of financial year
25.FINANCIAL
CONSOLIDATED
INSTRUMENTS
2008
Fixed Interest Rate Maturity
Average
Interest
Rate
%
Variable
Interest
Rate
$
Less than
1 Year
$
6.57
3,079,188
-
-
-
15,624
3,094,812
Trade receivables
-
-
-
-
-
1,087,437
1,087,437
RACT Insurance receivable
-
-
-
-
-
776,297
776,297
1 to 5 More than
5 Years
Years
$
$
Financial Assets
Cash
-
-
-
-
-
34,355
34,355
Floating rate notes
Accrued revenue
9.18
500,000
-
-
-
-
500,000
Commercial Bill Fixed Term
Deposit
7.64 1,000,000
-
-
-
- 1,000,000
Commercial Bill Security Deposit
7.64 1,000,000
-
-
-
- 1,000,000
Unit Trusts
-
-
-
-
- 3,684,832 3,684,832
Equities
-
-
-
-
-
34,804
34,804
Club Consortium
-
-
-
-
400,000
400,000
- 5,576,680
-
-
- 6,033,349 11,612,537
Trade payables
-
-
-
-
-
2,517,797
2,517,797
Bank overdraft*
-
-
-
-
-
(236,818)
(236,818)
Financial Liabilities
GST payable
-
-
-
-
-
231,580
231,580
Employee benefits
-
-
-
-
-
1,113,692
1,113,692
Deferred subscriptions
-
-
-
-
- 4,582,492 4,582,492
-
-
-
-
-
8,208,743
8,208,743
*No interest was incurred on the bank overdraft as it represents unpresented cheques
49
25.FINANCIAL
INSTRUMENTS
(continued)
CONSOLIDATED
2007
Fixed Interest Rate Maturity
Average
Interest
Rate
%
Variable
Interest
Rate
$
Less than
1 Year
$
1 to 5 More than
5 Years
Years
$
$
NonInterest
Bearing
$
Total
$
Financial Assets
Cash
3.75
1,863,761
-
-
-
13,724
1,877,485
Trade receivables
-
-
-
-
-
2,467,320
2,467,320
RACT Insurance receivable
-
-
-
-
-
969,563
969,563
Accrued revenue
-
-
-
-
-
37,321
37,321
Floating rate notes
7.59 3,000,000
-
-
-
- 3,000,000
Term Deposits
6.26 3,300,000
-
-
-
- 3,300,000
Unit Trusts
-
-
-
-
-
14,082,783
14,082,783
Equities
-
-
-
-
-
34,804
34,804
Club Consortium
-
-
-
-
-
425,000
425,000
-
8,163,761
-
-
-
18,030,515
26,194,276
Trade payables
-
-
-
-
- 2,539,222 2,539,222
Bank overdraft*
-
-
-
-
-
(90,104)
(90,104)
GST payable
-
-
-
-
-
268,352
268,352
Employee benefits
-
-
-
-
-
1,080,678
1,080,678
Deferred subscriptions
-
-
-
-
- 4,265,481 4,265,481
-
-
-
-
- 8,063,629 8,063,629
*No interest was incurred on the bank overdraft as it represents unpresented cheques
Financial risk management objectives and policies
The Group’s principal financial instruments comprise receivables, payables, bank overdrafts, shares, cash, short-term deposits
and investments.
The Group manages its exposure to key financial risks, including interest rate risk in accordance with the Group’s financial risk
management policy. The objective of the policy is to support the delivery of the Group’s financial targets whilst protecting future
financial security. The main risks arising from the Group’s financial instruments are interest rate risk, price risk, credit risk and
liquidity risk.The Group uses different methods to measure and manage different types of risks to which it is exposed. These include
monitoring levels of exposure to interest rate risk and assessments of market forcasts for interest rate and commodity prices.
Ageing analyses and monitoring of specific credit allowances are undertaken to manage credit risk, liquidity risk is monitored
through the development of future rolling cash flow forecasts.
The Board reviews and agrees policies for managing each of these risks as summarised below.
50
2007 08
25.FINANCIAL INSTRUMENTS (continued)
Primary responsibility for identification and control of financial risks rests with the Investment Committee under the authority of the
Board. The Board reviews and agrees policies for managing each of the risks identified below including interest rate risk, credit
allowances, and future cash flow forecast projections.
Risk Exposures and Responses
Interest rate risk
The Group’s exposure to market interest rates relates primarily to the Group’s short-term investments.
At balance date, the Group had the following mix of financial assets and liabilities exposed to Australian variable interest rate risk
that are not designated in cash flow hedges.
CONSOLIDATED
COMPANY
2008
$
2007
$
2008
$
2007
$
-
-
16,511,153
15,128,243
4,197,312
2,795,538
1,118,124
931,777
4,197,312
2,795,538
17,629,277
16,060,020
Bank Overdrafts
-
-
-
-
Bank Loans
-
-
-
-
Financial Assets
Loans
Cash and cash equivalents
Loans to controlled entities
Net exposure
-
-
-
-
-
-
-
-
4,197,312
2,795,538
17,629,277
16,060,020
The Group constantly analyses its interest rate exposure. Within the analysis consideration is given to potential renewals
of existing positions, alternative financing and the mix of fixed and variable interest rates.
The following sensitivity analysis is based on the interest rate risk exposures in existence at the balance sheet date.
At 30 June 2008, if interest rates had moved, as illustrated in the table below, with all other variables held constant,
post tax proift and equity would have been affected as follows:
Judgements of reasonably possible movements:
Post Tax Profit
Higher/Lower
Equity
Higher/Lower
2008
$
2007
$
2008
$
2007
$
+ 1% (100 basis points)
39,289
20,165
39,289
20,165
- .5% (50 basis points)
(18,106)
(10,082)
(18,106)
(10,082)
+ 1% (100 basis points)
6,943
3,078
6,943
3,078
- .5% (50 basis points)
(3,471)
(1,539)
(3,471)
(1,539)
Consolidated
Company
The movements in profit are due to higher/lower interest from variable rate cash balances.
51
25. FINANCIAL INSTRUMENTS (continued)
Price Risk
Price risk arises from investments in equity and property based securities. To limit this risk the Group diversifies its portfolio in
accordance with limits set by the Board’s Investment Policy. The portfolio consists of investment in Australian and international
equities, property trusts and funds under management.
The price risk for both listed and unlisted securities is material in terms of a possible impact on profit and loss or total equity and as
such a sensitivity analysis is presented below.
Units Held
2008
Percentage
Movement
2007
Post Tax Profit
Higher/Lower
Equity
Higher/Lower
2008
2007
2008
2007
$
$
$
$
+10%
94,605
183,951
94,605
183,951
(10%)
(94,605)
(183,951)
(94,605)
(183,951)
+10%
-
28,586
-
28,586
(10%)
-
(28,586)
-
(28,586)
+10%
50,385
602,864
50,385
602,864
(10%)
(50,385)
(602,864)
(50,385)
(602,864)
%
Consolidated
Equity Investments
Property trusts
Unit trusts
946,052
-
1,839,507
285,856
1,899,335 6,028,636
Credit Risk
Credit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to the company, it
arises from the financial assets of the Group which comprise cash and cash equivalents, trade and other receivables. The company
has the policy of only dealing with creditworthy counterparties.
Therefore the consolidated entity does not have any significant credit risk exposure to any single counterparty or any group of
counterparties having similar characteristics.
The Group’s exposure to credit risk arises from potential default of the counter party, with a maximum exposure equal to the
carrying amount of these instruments. Exposure at balance date is addressed in each applicable note.
The Group does not hold any credit derivatives to offset its credit exposure.
It is the Group’s policy that all customers who wish to trade on credit terms are subject to credit verification procedures including an
assessment of their independent credit rating, financial position, past experience and industry reputation. Risk limits are set for each
individual customer in accordance with parameters set by the Board. These risk limits are regulary monitored.
In addition, receivable balances are monitored on an ongoing basis with the result that the Group’s exposure to bad debts is
not significant.
There are no significant concentrations of credit risk within the Group and financial instruments are spread amongst a number of
financial institutions to minimise the risk of default of counterparties.
Liquidity Risk
The Group’s objectives are to maintain a balance between continuity of funding and flexibility through the use of bank overdrafts
and committed available credit lines.
The table below reflects all receivables for settlement, repayments and interest resulting from recognised financial assets and
liabilities as of 30 June 2008. For all obligations the respective undiscounted cash flows for the respective upcoming fiscal years
are presented. Cash flows for financial assets and liabilities without fixed amount or timing are based on the conditions exisiting at
30 June 2008.
52
2007 08
The remaining contractual maturities of the Group and Company financial liabilities are:
CONSOLIDATED
6 months or less
6-12 month
COMPANY
2008
$
2007
$
2008
$
2007
$
2,517,797
2,539,222
2,476,739
2,538,391
-
-
-
-
1-5 years
-
-
-
-
Over 5 years
-
-
-
-
2,517,797
2,539,222
2,476,739
2,538,391
Maturity analysis of financial assets and liability based on management’s expectation.
The risk implied from the values shown in the table below, reflects a balanced view of cash inflows and outflows. Leasing
obligations, trade payables and other financial liabilities mainly originate from the financing of assets used in our ongoing operations
such as property, plant and equipment, and investments in working capital eg inventories and trade receivables. These assets are
considered in the Group’s overall liquidity risk. To monitor existing financial assets and liabilities as well as to enable an effective
controlling of future risks, the Group has established comprehensive risk reporting covering its business units that reflects
expectations of management of expected settlement of financial assets and liabilties.
Year ended 30 June 2008
< 6 months
6 - 12 months
1 - 5 years
> 5 years
Total
$
$
$
$
$
Cash & cash equivalents
4,197,312
-
-
-
4,197,312
Trade & other receivables
1,087,437
-
-
-
1,087,437
5,284,749
-
-
-
5,284,749
2,517,797
-
-
-
2,517,797
2,517,797
-
-
-
2,517,797
2,766,952
-
-
-
2,766,952
Consolidated Financial Assets
Consolidated Financial Liabilities
Trade & other payables
Net maturity
53
Year ended 30 June 2007
< 6 months
6 - 12 months
1 - 5 years
> 5 years
Total
$
$
$
$
$
Cash & cash equivalents
2,795,538
-
-
-
2,795,538
Trade & other receivables
2,467,320
-
-
-
2,467,320
5,262,858
-
-
-
5,262,858
Trade & other payables
2,539,222
-
-
-
2,539,222
Net maturity
2,723,636
-
-
-
2,723,636
Consolidated Financial Assets
Consolidated Financial Liabilities
The Group monitors rolling forecasts of liquidity reserves on the basis of expected cash flow. Forecast liquidity reserves as at
30 June 2008 is as follows:
2009
2010-2011
$
$
4,197,312
4,447,864
Operating inflows
22,000,926
50,984,000
Operating outflows
(19,255,600)
(42,744,000)
(2,504,774)
(7,257,000)
10,000
15,000
4,447,864
5,445,864
Opening balance for the period
Cash outflows for investments
Investment proceeds
Closing balance for the period
Fair Value
The carrying amounts of cash, short term investments, trade receivables and trade payables approximate net fair value because
of their short maturity. Amounts receivable are carried at nominal amounts due, less any allowance for doubtful debts. Liabilities
are recognised for amounts to be paid in the future for goods and services received, whether or not billed to any member of the
consolidated entity. Trade accounts payable are normally settled within 30-60 days. The carrying value of the floating rate notes
and the fixed interest trust approximates fair value.
The methods for estimating fair value are outlined in the relevant notes to the financial statements.
26. SUBSEQUENT EVENTS
There are no matters or circumstances which have arisen since the end of the financial year which significantly affect, or may significantly
affect, the operations of the company, the results of those operations, or the state of affairs of the company in subsequent years.
27. ADDITIONAL COMPANY INFORMATION
The Royal Automobile Club of Tasmania Limited is a public company, incorporated and operating in Australia.
Registered Office
Corner Murray and Patrick Streets
HOBART TAS 7000
Tel: (03) 6232 6300
54
Principal Place of Business
Corner Murray and Patrick Streets
HOBART TAS 7000
Tel: (03) 6232 6300
Directors’ Declaration
2007 08
DIRECTORS’ DECLARATION
The Directors declare that:
a)in the director’s opinion, there are reasonable grounds to believe that the company will be able to pay its
debts as and when they become due and payable;
b) in the directors opinion the attached financial statements and notes thereto are in accordance with
Corporations Act 2001, including compliance with accounting standards and giving a true and fair view
of the financial position and performance of the company and the consolidated entity
Signed for and on behalf of the Board of Directors and in accordance with a resolution of the Board, made pursuant
to s.295(5) of the Corporations Act 2001.
R S LOCKE
DIRECTOR
C J LANGDON
DIRECTOR
Launceston, 23 September 2008
55
Independent Auditor’s Report
Chartered Accountants
advice to advantage
Independent auditor’s report to the members of The Royal Automobile Club of Tasmania Ltd
We have audited the accompanying financial report of The Royal Automobile Club of Tasmania
Ltd, which comprises the balance sheet as at 30 June 2008, and the income statement, statement of
changes in equity and cash flow statement for the year ended on that date, a summary of significant
accounting policies, other explanatory notes and the directors’ declaration of the consolidated entity
comprising the company and the entities it controlled at the year’s end or from time to time during
the financial year.
Directors’ Responsibility for the Financial Report
The directors of the company are responsible for the preparation and fair presentation of the
financial report in accordance with the Australian Accounting Standards (including the Australian
Accounting Interpretations) and the Corporations Act 2001. This responsibility includes
establishing and maintaining internal controls relevant to the preparation and fair presentation of the
financial report that is free from material misstatement, whether due to fraud or error; selecting and
applying appropriate accounting policies; and making accounting estimates that are reasonable in
the circumstances. In Note 1, the directors also state that the financial report, comprising the
financial statements and notes, complies with International Financial Reporting Standards.
Auditor’s Responsibility
Our responsibility is to express an opinion on the financial report based on our audit. We conducted
our audit in accordance with Australian Auditing Standards. These Auditing Standards require that
we comply with relevant ethical requirements relating to audit engagements and plan and perform
the audit to obtain reasonable assurance whether the financial report is free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial report. The procedures selected depend on our judgment, including the
assessment of the risks of material misstatement of the financial report, whether due to fraud or
error. In making those risk assessments, we consider internal controls relevant to the entity’s
preparation and fair presentation of the financial report in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the
effectiveness of the entity’s internal controls. An audit also includes evaluating the appropriateness
of accounting policies used and the reasonableness of accounting estimates made by the directors,
as well as evaluating the overall presentation of the financial report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis
for our audit opinion.
1st floor 160 Collins Street Hobart 7000, PO Box 1083 Hobart TAS 7001
Tel: (03) 6223 6155 Fax: (03) 6223 8993 Email: email@wlf.com.au Internet: www.wlf.com.au
Partners: Peter Beven, Harvey Gibson, Danny McCarthy,
Douglas Thomson, Joanne Doyle, Stuart Clutterbuck, Ian Wheeler
Managers: Shenna Hurd, Marg Marshall, Sharon Breen, Dean Johnson,
Alicia Leis, Melanie Richardson, Nick Carter, Paul Lyons, Kane Ingham, Kate Barnes
Consultants: Brent Palfreyman, Robert Whitehouse
56
2007 08
Independence
In conducting our audit we have met the independence requirements of the Corporations Act 2001.
We have given to the directors of the company a written Auditor’s Independence Declaration, a
copy of which is included in the directors’ report. The Auditor’s Independence Declaration would
have been expressed in the same terms if it had been given to the directors at the date this auditor’s
report was signed. In addition to our audit of the financial report, we were engaged to undertake the
services disclosed in the notes to the financial statements. The provision of these services has not
impaired our independence.
Auditor’s Opinion
In our opinion:
1.
The financial report of The Royal Automobile Club of Tasmania Ltd is in accordance with
the Corporations Act 2001, including:
(i)
giving a true and fair view of the financial position of The Royal Automobile Club
of Tasmania Ltd and the consolidated entity at 30 June 2008 and of their
performance for the year ended on that date; and
(ii)
complying with Australian Accounting Standards (including the Australian
Accounting Interpretations) and the Corporations Regulations 2001.
2.
The financial report also complies with International Financial Reporting Standards as
disclosed in Note 1.
H JHGIBSON
J GIBSON
PARTNER
PARTNER
WISE
LORD
& FERGUSON
WISE
LORD
& FERGUSON
57
58
Branches
Launceston
Cnr York & George Sts
(03) 6335 5633
Devonport
119 Rooke St Mall
(03) 6421 1933
Burnie
24 North Terrace
(03) 6434 2933
Hobart
Shop 1, 110 Collins Street
(03) 6222 9222
Rosny Park
Rosny Mall,
2 Bayfield St
(03) 6244 7755
Glenorchy
Cnr Main Rd
& Terry St
(03) 6273 1888
Kingston
Shop 49A
Channel Court
(03) 6229 8299
Solutions
Ulverstone
38 Reibey Street
(03) 6490 8350
07 08
The Royal Automobile Club of Tasmania Limited
Annual Report

2007/2008 Annual Report

Transcription

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