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2014-20152014-2015

ANNUAL REPORT

Lake Mountain Alpine Resort

Lake Mountain Road, Marysville, VIC, 3779PO Box 40, Marysville, VIC, 3779P 03 5957 7222F 03 5957 7231

E [email protected] www.lakemountainresort.com.au

ABN 17 315 087 255

© State of Victoria, Lake Mountain Alpine Resort Management Board 2016. This publication is copyright. No part may be reproduced by any process except in accordance with the provisions of the Copyright Act 1968.

ISSN 2205-8311

CONTENTS

Chairperson’s Report 1

Chief Executive Offi cer’s Report 4

Year in Review 7

Financial Information 13

Five-Year Summary of Financial Results 14

Corporate Governance 15

Charter and Purpose 21

Governance and Organisational Structure 26

Risk Management Compliance Attestation 35

Declaration by the Chairperson and the Chief Executive Offi cer 36

Financial Statements for the year ending 31 October 2015 39

LAKE MOUNTA IN ALP INE RESORT MANAGEMENT BOARD ANNUAL REPORT 2014-2015

1

As I come to the end of this term as the Chairperson of the Lake Mountain Alpine Resort Management Board (‘the Board’) I reflect on the challenges, changes and developments that have occurred over the last three years in our management structures, governance arrangements, future potential and role in the recovery of the Marysville region.

Much has been achieved. Much is still to be addressed, as Lake Mountain continues to offer to the people of Victoria a wonderful alpine adventure and wilderness experience.

A better than expected level of visitation during the white season has led to a better fi nancial result than budgeted and an accumulation of funds at year end. Funding advances received from the Department of Environment, Land, Water & Planning (‘DELWP’) have increased slightly over the previous year. These funds are paid by DELWP to cover the budgeted shortfall in operational expenditure. The Board has been working to reduce Lake Mountain’s dependence on government to fund its operations, so the build-up of cash balances is indicative of some success in reducing this reliance. It is anticipated that these cash balances will be used to fund future operations and/or capital outlays.

In June 2012, the then government tasked the Board to fi nd ways to improve the fi nancial sustainability of Lake Mountain Alpine Resort (‘the resort’) and to reduce the impost on the public funding of the resort. The Board was actively encouraged to be innovative by contracting a commercial sector company, to manage the operations of the resort, with the view to pursuing these objectives;

• increasing the number of white and green season visitors,• improve the marketing and promotion of the resort,• identify and facilitate the development of additional

facilities and events that would act as attractions to visitors,

• conduct operations in a more cost effective manner,• dissipate and share the risk in operating the resort, and• bring additional investment, including from the private

sector, into resort improvements.

The arrangement with the commercial operator has not been without its challenges. There has been a steep learning curve by those involved in this new style of arrangement for an Alpine Resort Management Board. Coming to grips with governance, fi nancial systems and reporting and other legislated compliance requirements has been more complicated than originally envisaged. That having been said, all involved have used best endeavours to pursue the original objectives.

Outcomes achieved over this period include;

• implementation of a leaner more cost effective staffi ng structure,

• increased white season visitation, which whilst still dependent upon the level of snow available appears to be trending upwards when compared to the previous ten years,

• improved orientation toward providing customer-focused service, the success of which is indicated by the most recent customer satisfaction survey results,

• developing a clearer view on what needs to be developed in the resort to stimulate further increases in the number of visitors coming to the resort,

• increase in the type of events and activities taking place in the resort,

• expanded role and infl uence in the marketing and promotion of the Victorian alpine sector, and

• substantial improvements to governance arrangements.

State Government

The Board acknowledges the level of funding provided to the resort to meet operational expenditure requirements that are not covered by revenue generated by the resort, and for capital outlays to address identifi ed risk issues, to replace assets and to try to improve the resort’s facilities. The system of the government providing quarterly funding advances to cover expected operational shortfalls in funding has worked well for the Board, as it has enabled the Board to effectively monitor, control and allocate its cash fl ow to meet its needs.

The Board continues to work actively and constructively with government to provide greater certainty around future fi nancial, management and governance arrangements for Lake Mountain.

CHAIRPERSON’S REPORT

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2LAKE MOUNTA IN ALP INE RESORT MANAGEMENT BOARD ANNUAL REPORT 2014-2015

The Board

As reported last year, I have been very fortunate to have such a dedicated, talented and passionate group of Board members working with me. The Board, and each of its members, have become immersed in trying to make Lake Mountain an even better place, to improve how the resort is managed and operated, and to develop a Resort Master Plan that is nearing fi nalisation, which when adopted will guide the future development and management of Lake Mountain. The Board has also been vigilant in trying to implement government policy, ministerial expectations and comply with legislation and good governance practices.

The Board proactively reorganised and expanded its committee structure to address pertinent issues intensively and in a timely manner. I would like to express my appreciation to the various Committee Chairpersons, and to the Board members of each of those committees for the work they have contributed and for what has been accomplished.

I would like to personally thank each of the individual Board members who have served on the Board. To Tony Nippard who has indicated that he is not seeking reappointment, thank you for the wise counsel and input you have provided to me and your colleagues during your sadly too short involvement on the Board.

The Executive Staff

Thank you to Board Secretary (part-time) Anita Hunter for your contribution to the organisation and functioning of the Board and the administration of the governance framework that supports the Board’s functions.

Also to Phil Nunn, the part time Board Chief Executive Offi cer, for his ideas, dedication, problem solving capacity, vigilance in ensuring that compliance issues are identifi ed and addressed, and for his day to day management of the commercial sector contractor.

Commercial Sector Operator: Belgravia Leisure

Belgravia Leisure Pty Ltd (‘Belgravia Leisure’) has been

contracted to provide management services, including administering the Board’s accounting system, for the past three years. The service provided by this company has led to some good outcomes. Our gratitude to Belgravia Leisure’s Lake Mountain Resort Manager Scott Gamble for the enthusiasm and aptitude he has displayed in this role, and to Scott McDonald, the Belgravia Leisure executive overseeing the Belgravia Leisure presence in the resort and the contractual relationship with the Board.

Resort Staff

Given that core staff numbers have been reduced, our staff are always fully occupied as they work with great passion, skill and experience. The challenge of operating in a fi nancially constrained environment where resources are not as available as one may like, continues to challenge, but to the credit of all staff they fi nd ways to implement cost-effective, innovative solutions to ensure that the resort’s assets are well maintained, visitors are welcomed and fellow staff members are supported. It has not been an easy year for staff, as one of their workmates, Jarrod Ackerman, suffered serious injuries from a workplace incident. Thankfully Jarrod is recovering well, perhaps in part due to the great support he has had from those with whom he has worked.

Ski Patrol

A big thank you to Sue Parry (Belgravia Leisure staff member and coordinator) and the volunteer group who allow Lake Mountain to provide a ski patrol service. Whilst this service was originally geared toward supporting those who used Lake Mountain’s wonderful cross-country ski trail network, this group provides the fi rst aid service to the people using the snow play facilities at Lake Mountain and do a wonderful job of that.

Department of Environment, Land, Water and Planning

The Board and executive staff appreciate the constructive, directive and supporting role played by DELWP offi cers as we work together to implement government policy and achieve objectives.


3

Parks Victoria

We look forward to continuing the relationship with Parks Victoria to ensure that we jointly protect and enhance the environment we share, and to make people feel welcome as they enjoy the facilities we collectively provide.

Alpine Resorts Co-ordinating Council

The role played by the Alpine Resorts Co-ordinating Council (‘ARCC’) and its executive team is also appreciated as it attempts to advance and coordinate the interests of the Victorian Alpine Resorts as we progress implementation of the Alpine Resorts Strategic Plan 2012.

In Summary

All involved with Lake Mountain do so to provide a great place for people to visit and have a wonderful experience. All of us welcome the opportunity to see visitors to the resort having a fantastic time. On behalf of the Board, the staff and our commercial sector partner, we thank all visitors for coming to Lake Mountain, and encourage you to come back and to share your experience with others.

I thank the government for having confi dence in and supporting me during my current term as Chairperson, and again state that whatever experience we are able to offer the visitors who use Lake Mountain arises from the efforts of those involved. Again, thank you to everyone.

Tony ThompsonChairperson31 December 2015


Firstly, I would like to acknowledge the Board, under the leadership of Chairman Tony Thompson which with all Board members returning for the 2014-15 year, provided great guidance, dedication, enthusiasm and input into what has been achieved during this year. The Board’s role in setting the agenda for the year, monitoring and acting upon issues as they arise has enabled the resort to achieve good things.

Secondly, I record my appreciation to the offi cers of DELWP and the ARCC for providing wise counsel and support to me, thus enabling the resort to avoid pitfalls and to take advantage of opportunities as they arose. I think it also appropriate to record the high level of support from the CEOs of the other Alpine Management Resorts.

I would also like to thank the staff of Belgravia Leisure, the staff who work at Lake Mountain and Board Secretary Anita Hunter for the collaborative contribution all have made to my attempts at fulfi lling my role.

White Season 2015

The experienced operational staff did an amazing job during this white season, by using the recent additions to our snow-making equipment to supplement the capacity of small natural snow falls with man-made snow, to provide an attractive season of snow offer for snow players and cross-country skiers. Our experienced staff have stated that without snow-making we would have only been able to provide a toboggan slope for less than 10 days this year which would have impacted heavily on our ability to attract visitors. Our capacity to make snow enabled us to provide a great snow-based experience for more than 120,000 visitors, whereas it would have been likely to have been less than 60,000 without snow making. Whilst white season visitor numbers were down on the 2014 levels, the level of visitation was so much bigger than it would have been. A good argument for even further investment in this capacity!

CHIEF EXECUTIVE OFFICER’S REPORT


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Resort Master Plan

It has been an enriching professional experience to work with the Board, staff, our commercial partners, stakeholders and our professional consultants to develop a Resort Master Plan that will provide guidance as to future development decisions for Lake Mountain. Whilst wanting to protect and enhance the natural environment of such a beautiful place, we have been discussing and considering concepts for the development of further attractions and facilities that would truly make Lake Mountain an even better alpine attraction, easily accessible for the people of Melbourne and Victoria. A place for those people perhaps having a fi rst snow experience which would whet their appetite for repeat visits to Lake Mountain and to other Victorian alpine resorts.

I look forward to this plan once fi nalised to be endorsed by government and implemented over coming years.

I also look forward to advocating for, and escalating these investment opportunities through the ARCC’s Victorian Alpine Resorts Development Pipeline (‘VARDP’) process, building support through the recognition from other resorts and the ARCC, of Lake Mountain’s position as an introductory place for people to experience the tourism and recreational experience offered by the Victorian Alpine Resorts.

Priorities

The priorities for the coming year include continuing to provide alternate energy and greenhouse emission effi ciency means by providing electricity to the resort. The current dependence on diesel- powered generators does not sit comfortably for such a wonderful place with strong environmental values. The Board has and will continue to investigate alternate energy production methods such as solar, wind and thermal generation systems, and advocate for funds to invest in more energy- effi cient snow-making equipment, and energy management initiatives to reduce consumption for lighting, heating, hot water, air conditioning and ventilation, and to implement cost-effective conservation measures by reducing building energy losses.

The organisation would like to also address white season customer service improvements to reduce queuing, reduce overcrowding by spreading visitors in peak times and to increase the array and quality of experiences that our visitors can enjoy. We want to build upon the excellent and popular initiative to provide introductory cross-country ski lessons and to provide greater offer for young families. This may involve some minor external works, but more constructively, modifi cations to how we use the internal building spaces.

We also look to pursuing partnerships with commercial businesses to provide additional green season nature-based adventure activities that complement the image that Lake Mountain should convey.

All of this will be pursued in the context of rigorous fi nancial management and compliance with the regulatory environment in which the Board operates.

We also look forward to continuing the mutually benefi cial relationship we have with the business people and other members of the Marysville Triangle community.

Thank you for the opportunity.

Philip NunnChief Executive Offi cer31 December 2015


7

White Season

Despite only receiving about 78 centimetres in natural snow fall for the entire season, the resort was able to attract in excess of 120,913 day visitors. This achievement is well in advance of the ten-year average and is explained by the resort’s capacity to make snow and thus provide a guaranteed snow play offer, improved experiences giving rise to repeat visitations, and increased marketing and public relations activity to promote Lake Mountain to the public of Victoria. The favourable climatic conditions that prevailed for most of the white season – chilly, not a lot of windy days, minimal rain falls and low humidity – provided the ideal environment to take advantage of the resort’s recent initiatives to invest in additional snow-making capacity. It was great to see the Village and Koala Creek toboggan slopes covered in snow (man-made) for so much of the season.

140000

120000

100000

80000

60000

40000

20000

0

2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015

Approximately 15% of all winter season alpine visits to Victorian Alpine Resorts in 2015 were to Lake Mountain. The importance to the Victoria Alpine sector of this level of visitation is magnifi ed, as for many of our visitors it is their fi rst visit to the snow. The resort continues to attract a wide diversity of people, forming a wide cross-section of the community. The resort’s proximity to Melbourne, ease of road access and the fact that it provides a relatively inexpensive introductory snow experience is proving to be popular with many groups from differing socio-economic and ethnic backgrounds. New markets are being opened for snow visits as a result of this initial experience that these Lake Mountain visitors have.

YEAR IN REVIEW

YEAR

IN R

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W

Table 1 WHITE SEASON VISITATION


Whilst efforts are being made to fi nd solutions to the resort’s capacity to handle the crowds on its peak white season days, it remains a challenge to reduce queueing times in providing food and beverage and rental equipment to visitors.

More specifi c highlights of the white season included:

• In partnership with Fischer Skis the resort introduced three new programs to Lake Mountain including the Fischer Nordic Demo Centre, Fisher Nordic Fun Park and Snow Sport Centre.

• The Fischer Nordic Demo Centre has the latest line up of Fischer cross-country skis and boots on display and these are available for testing. The centre provides a professional high-profi le presence for cross-country skiing at the resort and is unique to the Southern Hemisphere.

• The Nordic Fun Park has been an unprecedented success and perhaps the most signifi cant program for the development for cross-country skiing in some time. 4,000 children participated in cross-country skiing trials over the 2015 season.

• A bright blue sky day and unexpected snow production on Mountain Mayhem Eve delivered the perfect setting for a great day of free tobogganing, snow play and adventure activiites. With 3 tobbogan slopes open, visitors stayed all day to slide, zip and shoot their way around the mountain.

• With great anticipation for its third season, the Annual Australian Snowman’s Festival commenced with a fl urry of snowmen popping up across the landscape. The extended Snowman’s Village has provided much needed space on busier days and is a defi nite focal point for the construction of snow-men, snow-women, snow-rabbits and all forms of snow-based creatures. The festival provides a fun family activity that encourages repeat visitation and is continuing to prove to be a highly engaging organic marketing event and added element of excitement and atmosphere as snowmen appear magically from all corners of the resort.

Table 2 SNOW DEPTH 2015

SNOW

DEP

TH (C

M)

100

90

80

70

60

50

40

30

20

10

0

2015 Natural Snow Depth 2015 Average depth in snow-making area (3 ha)

5 Jun

12 JU

N19

JUN

26 JU

N3 J

UL10

JUL

17 JU

L24

JUL

31 JU

L7 A

UG14

AUG

21 AU

G28

AUG

4 SEP

11 SE

P18

SEP

25 SE

P2 O

CT

DATE


9

Visitor Satisfaction

Whilst the resort receives much positive feedback during the winter season, the resort participates in the ARCC’s research into visitor satisfaction, with results for 2015 showing a pleasing upturn. Management will use these results, its own observations, and the assistance of skilled hospitality and tourism operators to continue to modify and improve its service delivery systems to optimise the experience of its white season visitors. ARCC Customer Satisfaction Survey for Lake Mountain indicates a generally improved level of visitor experience for 2015 in comparison to the previous survey in 2014. The highlight being an increase in Lake Mountain’s Net Promoter Score (NPS) for the 2015 season to 29 – up 28 from 2014 and the highest result since 2010.

It is a signifi cant accolade for the resort to have been awarded a Trip Advisor Certifi cate of Excellence. This has been earned as a result of consistently excellent reviews on Trip Advisor from guests who have visited the resort. The award is fantastic acknowledgement of the focus to create an exceptional guest experience, which has been built over the last 18 months.

Our Programs and Events

The addition of a fourth toboggan slope, expansion of the popular Snowman’s Village snow play zone and creation of the Fischer Fun Park and snow-shoeing trail introduced much needed space and activities for visitors to enjoy a snow experience.

Minor Resort Development

Construction of rustic fencing and placement of resort fl ags around the picnic and Snowman’s Village areas provided an improved aesthetic.

The purchase of an additional T40 Snow Gun consolidated snow production and enabled fl exible delivery to key resort zones. 25,848 cubic metres were produced in 2015 compared to 10,666 cubic metres in 2014.

Post 2009 Murrindindi bushfi re, tree risk continues to escalate and is being managed through daily tree risk assessments and major risk mitigation works over the green season.

Ski Patrol Report

Ongoing recruitment and publicity initiatives continue to attract new ski patrol members. This has helped to fi ll the weekend roster on most weekends. The resort is particularly fortunate to be able to call upon such a great group of volunteers to complement the talented and enthusiastic staff members who lead the group These people combine to provide an excellent range of skills and experiences to ensure our visitors are given great care by the Lake Mountain Ski Patrol.

Icy surfaces and snow falling off the roofs continue to require ongoing assessment of risks and temporary closure or control of affected areas through placement of appropriate signage. These strategies have been used successfully in combination with rubber matting in high-risk icy areas to improve visitor safety.

Ambulance Victoria again placed a paramedic in Buxton for the season and this was of great assistance in reducing the response time. Ambulance Offi cers have been particularly helpful, and are always happy to come up and assess a patient before deciding whether a trip to hospital is required.

Ski Patrol members have been increasingly involved in both summer and winter events held at Lake Mountain, both in an organising and in providing a fi rst aid presence.

The number of snow-based accidents and incidents were commensurate with expectations, given the number of visitors we had to the resort.

HERE

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Engagement with the Community

The resort maintained and expanded its close relationship with schools within the region.

Lake Mountain maintained and developed the following community initiatives:

• Weekly Snow drops in Marysville.

• Oz Child Snow Play Day - 45 children and 20 carers visited the mountain to experience a day of snow play and adventure activities.

• Representation of Lake Mountain on local tourism groups including the Marysville Triangle Business & Tourism Executive Committee and Yarra Ranges Tourism Corporate Events Committee.

The resort also continued to provide direct fi nancial and personnel support to the Marysville Visitor Information Centre. The Resort Manager also plays a continuing and constructive role in local tourism and business groups, to foster mutually rewarding relationships.

Marketing and Promotion

The website, use of social media, new links into the Thursday night weather reports on Channels 7 and 9 and the successful launch of the snow season in the City of Melbourne all appear to have contributed to greater public awareness of the Lake Mountain product offer. Reference to live snow cams (two additional cams in 2014), and social media reports provide popular up-to-date information on conditions at Lake Mountain and enabled people to plan their visits to coincide with good snow conditions. These broad marketing thrusts, combined with direct engagement with schools and other groups with an historical link to Lake Mountain, have contributed to a pleasing level of visitation in a below average natural snow fall year.

Merchandising

Growth in this revenue generating activity continues, with many people making purchases of either functional items to provide protection from the elements or for a memento to take home. The commercial partnership with Fischer provided the cross-country ski afi cionado with the opportunity of trialling the latest and best equipment. This was a welcome enhancement to the resort’s white season offer. Redesign of merchandise retail space for improved access and creation of a retail page on the resort’s website focused on popular product lines.

Some Observations from the White Season

Once we achieve more than about 950 visitor cars into the resort, overcrowding tends to diminish the quality of the visitor experience.

Visitors tend to congregate at key focal points, meaning some signifi cant areas within the resort are underutilised. Efforts will continue to spread the areas of use, and reduce congestion. The experiences they seek are easy access to the toboggan slopes, the ability to build a snow man, or have a snow play, or to fi nd their way to enjoy snow covered beautiful cross-country ski trails in the wilderness. It also appears that for some, the white season experience for visitors is enhanced when there are additional adventure activities over and above traditional snow-based things to do.


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The resort has created some signifi cant partnerships with event promoters, including those responsible for offering the Paradise music festival; Warrior Challenge; fun runs; and mountain bike races, including the Granite Grind. Increasingly, the resort is developing a reputation as a suitable venue for event organisers to conduct events. This is seen as a future growth prospect for the resort, as is providing a venue for product marketers (in particular motor vehicles) who want to use the natural beauty of the Lake Mountain scenery to complement the product that they wish to market.

A number of road cycling events have been conducted with Lake Mountain as a feature including the 7 Peaks challenge event, and many road cyclists have appreciated the initiative to close access to traffi c during set periods of time on some weekends to enable them to ride up to the resort without confl icting with motor vehicles. The popularity of road cycling is evident by the number of cyclists who come to Lake Mountain to improve their fi tness and to experience the natural beauty Lake Mountain road.

1 For the purpose of extrapolating visitor numbers, average vehicle occupancy rates (3.7 per vehicle) are used in conjunction with vehicle counts to estimate the number of visitors to Lake Mountain.

Green Season

The Board is committed to trying to expand the green season activity and events offer. The Board continues its attempts to develop relationships with commercial partners to encourage those businesses to invest in activities that will make the resort a greater attraction. An estimated 50,3891 people visited the resort during the green season.

80000

70000

60000

50000

40000

30000

20000

10000

0

2009-2010 2010-2011 2011-2012 2012-2013 2013-2014 2014-2015

Table 3 GREEN SEASON VISITATION

YEAR

IN R

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Stage 1 of the Lake Mountain to Marysville mountain bike trail project has been completed, providing 14 kilometres of trail from the resort summit to the ticket box. Feedback on the new stage has been very positive, further consolidating the region’s mountain bike offering.

The Board continues to work with DELWP to examine the potential for, and, if appropriate, plan for the creation of a mountain bike track from the resort to Marysville – a track that will complement the existing tracks available within the resort. Mountain biking is seen as a growth product for the resort.

Lake Mountian offered a range of acitivities over the September school holidays, including a free tube run happy hour between 12 and 1pm every day, free orienteering and treasure hunt, roller sking and laser skirmish for group bookings, and mountain bike hire. Families were challenged to fi nd Lake Mountain’s special children’s possum character, ‘Lenny’ hiding in the forest in 3 locations close to the resort zone.

Environmental Management

The resort’s Environmental Offi cer has further developed her initiative to collect seeds to propagate plants and use these plants to assist in the alpine vegetation’s recovery from the 2009 bush fi res. The health and growth of the recently planted native trees and shrubs has added to the beauty of the resort. The Board has again complied with its Water Authority responsibilities, and continues to implement its Environmental Management Plan. The Board is engaging

constructively with Parks Victoria to protect and preserve the natural land values within the Resort and the neighbouring Yarra Ranges National Park, a part of which the Board has formalised access rights over, in order to enhance its cross-country ski product, offer. The resort also benefi tted from a DELWP program to address weed infestation.

The Board continues to monitor key measures, including waste per winter season visitor; diesel usage per winter season visitor; and the amount of waste generated in the resort, and also monitors the quality of water downstream of the resort’s sewer treatment plant. The results of the monitoring of these measures have been acceptable, but further improvements will be sought in future years.

New maps detailing summer walks and mountain bike trails have been created.

Emergency Management

The Board is a partner with Murrindindi Shire Council and other government agencies in the region’s Fire and Emergency Management Plan.


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Operational and Budgetary Objectives

The Board achieved a net result from transactions of a defi cit of $217,290, which gave rise to a net operating defi cit of $333,927, after taking into account the loss on disposal of some redundant assets and the write-down in asset value as a result of the impairment of some assets. This result compares to a budgeted defi cit of approximately $1.49 million dollars. This budget assumed that the resort would benefi t by receiving anticipated funding for essential operational purposes from the Department of Environment, Land, Water & Planning of $2.6 million, the difference being the budgeted level of depreciation of $1.14m. This level of funding from DELWP was received as budgeted.

Major Changes or Factors Affecting Performance

Whilst visitation fell from the 2014 level of 131,692 to 120,913, a reduction of 10.5%, revenue derived from visitors declined by approximately $100,000 (3.4%). The Board received a one-off windfall gain by reaching settlement with Ausnet Electricity Services Pty Ltd in regard to uninsured damages suffered as a result of the 2009 Murrindindi bushfi res.

The Board, with the approval of DELWP, used funds to acquire additional snow-making machines, and to refresh its stock of clothing and equipment for hire to visitors at the resort. The snow- making, as detailed in the “Year in Review” enabled the resort to maintain a strong level of visitation despite the poor natural snow during the white season. Merchandise, ski school and ski hire revenue increased from the previous year despite the lower visitation levels. Comparative annual information for the major revenue streams is shown in Note 2 to the Financial Statements.

Operational expenditure increased by 2.2% over last year’s level. This included an increase in payments to Belgravia Leisure, which related to the payment of a fi nancial incentive that the Board was contractually obligated to pay as a result of the 2014 fi nancial result.

Other out-of-the-ordinary expenditures included payment for works to mitigate geo-technical risks (for which a capital contribution from DELWP had been received), and payments to address the risk to the public imposed by the vast number

of fi re-damaged trees that exist in the resort. Together these two outlays totalled approximately $150,000.

Without these outlays, expenditure levels may have been slightly lower than in 2014.

Significant Changes in Financial Position During the Year

The Board has been able to accumulate a pool of funds (i.e. total fi nancial assets) at year-end, as some of the funding advances were not needed to meet expected shortfalls in operational expenditures. Total fi nancial assets at year-end totalled $2.057 million, compared with $1.52 million at the same stage last year. Total liabilities at year-end also fell by approximately $120,000.

In summary, the Board fi nds itself in a much stronger fi nancial position than in recent years, which, with sustained good management and continued support from government, it expects to continue into the future.

Capital Projects

The Board does not manage any capital projects during 2014-15.

Subsequent Events

On the 9th December, 2015, the Minister for Environment, Climate Change & Water issued a media release in which she announced that the ‘boards responsible for Lake Mountain and Mount Baw Baw will be merged’ to form the Small Alpine Resorts Management Board, subject to legislation being passed by parliament. It is expected that this legislation will be introduced to parliament in 2016. The creation of this new entity would see the winding up of the existing Lake Mountain Alpine Resort Management Board and its assets transferred to the new Board (refer Financial Statements Note 22, Events occurring after Balance Date).

FINANCIAL INFORMATION

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FIVE YEAR SUMMARY OF FINANCIAL RESULTS

TABLE 4 The table shows the fi ve-year summary of the Resort’s Financial Results:

Comprehensive Income Statement 2015 2014 2013 2012 2011

$ $ $ $ $

IncomeOperating 2,899,125 3,000,761 1,536,046 2,363,747 1,599,330

Support Payments 2,599,234 2,464,009 3,122,206 1,798,245 3,227,000

Other Funding - 45,896 761,445 1,032,581 1,380,242

Other Non-Operating Income 219,389 113,057 145,074 265,091 221,968

Proceeds from Insurance Claims - - - - 532,002

Interest revenue 32,413 10,078 7 - -

Total Income 5,750,161 5,633,801 5,564,779 5,459,664 6,960,542

ExpensesOperating 4,773,158 4,732,590 4,661,545 4,478,381 4,037,804

Depreciation 1,084,880 1,093,697 1,138,898 1,291,856 942,688

Geotech 105,458 9,724 66,541 287,749 130,637

Total Expenses 5,963,496 5,836,011 5,866,984 6,057,986 5,111,129Net gain/(loss) on disposal of non-fi nancial assets

(120,591) (7,888) 1,113

Comprehensive Result Profi t/(Loss)

(333,926) (210,098) (301,092) (594,151) 1,849,413

Balance Sheet 2015 2014 2013 2012 2011

$ $ $ $ $

Financial Assets 2,057,480 1,520,737 643,108 656,047 271,390

Non-Financial Assets 20,354,735 21,194,365 22,181,575 23,209,604 24,728,506

Total Assets 22,412,215 22,715,102 22,824,683 23,882,711 24,999,896

Total Liabilities 377,764 496,725 396,206 1,184,118 1,707,052

Net Assets 22,034,451 22,218,377 22,428,477 22,698,593 23,292,844

Equity 22,034,451 22,218,377 22,428,477 22,698,593 23,292,844


15

CORP

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OVER

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CORPORATE GOVERNANCE

The Board

Lake Mountain Alpine Resort Management Board at 31 October 2015 comprised:

Tony Thompson (Chairperson)Kevin Ritchie (Deputy Chairperson)Deborah Culhane Tony NippardRobert ThomasonHaley Tudor-Harrop

Tony Thompson

Tony has run his own businesses for 30 years, mainly in hospitality. For the past 15 years, Tony and his wife Penni have owned and run Maryton Park B & B Country Cottages. Tony has also been a director of the Dandenong Ranges Banking Group (Bendigo Community Bank) since its inception 17 years ago. Other board memberships include Chair of the Marysville & Triangle Community Foundation, Regional Development Australia and Alpine Resorts Co-ordinating Council. Since the 2009 Black Saturday fi res, Tony has chaired the Community Recovery Committee, dealing with all matters regarding the region, tourism, economics, mental health and the overall recovery of the Marysville and Triangle area and is now consulting for Emergency Management Victoria.

Kevin Ritchie

Kevin has extensive experience in management of public land and natural resources, having worked with the then Department of Sustainability & Environment and some of its predecessor organisations for many years, especially in North-East Victoria. Kevin was Regional Director in the Department’s NE Region, and a senior project manager.

Kevin has been actively involved in planning matters relating to various Victorian Alpine Resorts, and worked with the Murrindindi Bushfi re Recovery program after the Black Saturday fi res. Kevin has experience in governance issues, as a board member of both the North-East and the Goulburn-Broken Catchment Management Authorities, and worked with a variety of other community, industry and indigenous groups in Northern and North-East Victoria in land use, water management and other key regional issues.

Kevin continues to maintain an active interest and involvement in outdoor activities as a (semi) regular cyclist and camper, and he continues to keep an active interest in environmental management and change, cultural and community interests, and public policy.

Deborah Culhane

Deborah brings to the board a strong commercial legal background, having practised for many years as a corporate lawyer with the tourism/entertainment- focused Village Roadshow group of companies. She is experienced in marketing law, events law, liquor licensing, commercial leasing, fi lm and media law, employment law and workplace health and safety.

With strong family connections in Marysville, Deborah is passionate about the town. Deborah is a member of the Marysville and Triangle Community Foundation Board and enjoys taking an active role in the reigniting of tourism and commerce in the region. She is a keen viola player and a strong advocate of community music-making, serving as Treasurer on the board of the Murray Conservatorium of Music.

With two Italian greyhounds in tow, Deborah is a keen walker, but also likes to swap between terra fi rma and the sea to sail and ocean race.


Tony Nippard

Tony is a part-time public servant, governance professional and board director. Tony has had extensive experience as a senior executive in various roles primarily in the areas of health and human services. Tony has a BA, B Com (Hons) and MA from the University of Melbourne. He is a Fellow of the Australasian College Health Services Management, Fellow of Institute of Chartered Secretaries, Fellow Governance Institute of Australia and Graduate of the Australian Institute of Company Directors.

Tony has been a Director of not-for-profi t and public entities since 1988 in the arts, mortgage fi nance, community health, health information management, children services, as well as advisory committees on child protection, public sector governance and tertiary education. He is currently on the Board of Westside Circus Inc. and a board director of Melbourne Polytechnic, Neami Ltd., the Alpine School and Vic Defence Reserves Support Council.

Robert Thomason Rob has accumulated over 30 years’ experience working in higher education, consulting and executive development, both in Australia and internationally.

He is currently on the Executive Leadership Team of CPA Australia, with responsibility for all education activities. Prior to that he was responsible for global business development and new market entry.

Rob has held a number of senior roles in the area of corporate learning over the past three decades, having commenced his career in university management. He has worked with and for professional associations, university corporate arms and the private sector and brings a wealth of knowledge and experience in designing, developing, promoting and delivering executive learning to assist organisations meet their goals.

Rob has worked with Fairfax Media, one of Australia’s largest media organisations and was Director, Executive Education with the esteemed Melbourne Business School. Rob has held a number of senior directorships including with the United States-based International University Consortium for Executive Education and a successful Australian Financial Services training organisation and is currently Chairman of CPA Australia (Shanghai) Ltd.

As a Director of Lake Mountain Alpine Resort Rob hopes to see the resort become a year round recreation facility accessible to all. He is a downhill skier and a keen bushwalker, having completed major hikes in the UK, New Zealand, South America as well as Australia.

Haley Tudor-Harrop

Haley is an experienced chartered accountant, having previously been a partner in a chartered accountancy practice. After taking a career break to have a family, she has recommenced in the accounting and taxation world with a local practice in Mansfi eld, Victoria.

Haley recently graduated from the Australian Institute of Company Directors. She is currently Company Secretary (four years) for Mansfi eld & District Community Enterprises (MDCE) Ltd, which operates the Mansfi eld & District Community Bank, and previously sat on that board as Treasurer for four years. Haley has also held a number of other voluntary positions with local committees over the past 10 years, mainly in the not-for-profi t sector as Treasurer.

Haley focuses on areas of taxation and accounting, as well as board and organisation governance.

In her spare time, Haley spends time on the water with her friends and family, including her two young daughters and husband. Prior to a tree-change back in 2003, Haley grew up and was educated in the Yarra Valley of Victoria, obtaining her accounting degree through Swinburne University of Technology.


17

AUDIT AND FINANCE COMMITTEEMEMBERSHIP AND ROLES

The Audit and Finance Committee consists of three members, one of whom is the Chairperson. All members of this committee are deemed to be independent. Members of the committee are appointed by the Board, and are bound by the Committee Charter. The Board considers the membership annually.

The role of the Audit and Finance Committee is to oversee and advise the Board on matters of accountability, internal control and fi nancial management which affect the operation of the organisation and the resort.

The main responsibilities of the committee include the oversight of:

• The fi nancial performance of the Lake Mountain Alpine Resort Management Board;

• Financial budgeting and management, including the assessment of budgets and capital expenditure proposals;

• The fi nancial reporting process;• The scope of work, performance, fi ndings and

recommendations of the internal and external auditors;• In conjunction with the Risk and Governance Committee

aspects of the risk management framework, albeit that the other committee takes lead responsibility;

• Matters of accountability and internal control affecting the operations of the Board; and

• The effectiveness of management information systems and other systems of internal control.

Membership of the committee in 2014-15 comprised of:

• Robert Thomason, Chairperson (independent)• Haley Tudor-Harrop (independent)• Tony Thompson (independent and Board Chairperson)

There were 6 meetings of this committee held during this fi nancial year. Meetings are held as scheduled on the Board Calendar or at any other time on request of a committee member, or the Board, or the internal or external auditor. Attendance of committee members is detailed in the meetings attendance table.

PURPOSE OF THE COMMITTEES

Risk and Governance Committee

To oversee the risk management system of the Board, and to provide guidance to the Board to ensure that good governance practices are in consistently followed.

Resort Master Plan and Environment Committee

To oversee the development of a Resort Master Plan for the resort, and to monitor implementation of the Environmental Management Plan and to consider and make recommendations to the Board for amendments to that plan.

Management Arrangements and Executive Remuneration Committee

To oversee the contractual arrangements with the Board appointed commercial operator, and to evaluate the effectiveness of the management arrangements put in place by the Board from time to time, and to ensure that executive remuneration practices are transparent and are consistent with government and board policy.

Each of these committees has fulfi lled its function, achieved a number of objectives and contributed to the good governance practices of the Board.

CORP

ORA

TE G

OVER

NAN

CE


MEETING ATTENDANCE

Lake Mountain Alpine Resort Management Board

Board Member

Meetingno.

Meeting Tony Thompson

Kevin Ritchie

Robert Thomason

Deborah Culhane

TonyNippard

Haley Tudor-Harrop

1 21-Nov-14 √ √ √ √ √ -

2 16-Dec-14 √ √ √ - √ √

3 16-Jan-15 √ √ √ √ √ √

4 19-Feb-15 √ √ √ √ - √

5 20-Mar-15 √ √ - √ √ √

6 17-Apr-15 √ √ √ - √ √

6B 27-Apr-15 √ √ √ √ √ √

7 30-Apr-15 √ √ √ √ √ √

8 19-Jun-15 √ - √ √ √ √

9 17-Jul-15 √ - √ √ √ √

10 21-Aug-15 √ √ - - √ √

11 18-Sep-15 √ √ √ √ √ √

12 16-Oct-15 √ √ √ √ √ √

13 11 11 10 12 12

Audit and Finance Committee

Committee Member

Meetingno.

Meeting Robert Thomason Haley Tudor-Harrop

Tony Thompson

1 19-Feb-15 √ √ √

2 17-Apr-15 √ √ √

3 15-May-15 √ √ √

4 19-Jun-15 √ √ √

5 18-Sep-15 √ √ √

6 16-Oct-15 √ √ √

TOTAL 6 6 6


19


Committee Member

Meetingno.

Meeting Kevin Ritchie Tony Nippard Haley Tudor-Harrop

1 20-Mar-15 √ √ √

2 30-Apr-15 √ √ √

3 21-Aug-15 √ √ √

4 16-Oct-15 √ √ √

4 4 4

Resort Master Plan and the Environment Committee

Committee Member

Meetingno.

Meeting Robert Thomason Deborah Culhane Kevin Ritchie

1 19-Feb-15 √ √ √

2 18-Sep-15 √ √ √

3 16-Oct-15 √ √ √

3 3 3

Management Agreements and Executive Officer Committee

Committee Member

Meetingno.

Meeting Tony Thompson Deborah Culhane Tony Nippard

1 19-Feb-15 √ √ -

2 16-Oct-15 √ √ √

2 2 1

CORP

ORA

TE G

OVER

NAN

CE


Gifts, Benefits and Hospitality Attestation

I, Tony Thompson, Chairperson of Lake Mountain Alpine Resort Management Board, certify that:

• my public entity has gifts, benefi ts, and hospitality policies and procedures in place;

• these policies and procedures are consistent with the minimum requirements and accountabilities outlined in the Gifts, Benefi ts and Hospitality Policy Framework for the Victorian Public Sector – Revised April 2012 issued by the Public Sector Standards Commissioner; and

• these policies and procedures are updated, promulgated, and provided to the Risk and Governance Committee for review at least once a year.

Tony ThompsonChairpersonLake Mountain Alpine Resort Management Board31 December 2015


21

Manner of Establishment and Responsible Minister

Lake Mountain Alpine Resort Management Board is established under the Alpine Resorts (Management) Act 1997 (“the Act”). The responsible Minister is the Minister for Environment, Climate Change and Water.

The Government’s vision for alpine resorts in Victoria, as outlined in the Alpine Resorts Strategic Plan 2012, is:

Victoria’s alpine resorts will be vibrant, growing and sustainable places, delivering alpine recreational and tourism experiences that are available to all.

Lake Mountain Alpine Resort Management Board is committed to the following vision:

Lake Mountain will be a year-round resort where visitors engage in recreational and nature-based experiences that are precious, unique, exciting, and contribute to the regional economy.

Objectives, Functions, Powers and Duties

Section 38 of the Alpine Resorts (Management) Act 1997 specifi es the functions of the Board:

• To plan for the development, promotion, management, and use of the alpine resort in accordance with the object of the Act;

• To develop and promote or facilitate the development or promotion by others of the use of the alpine resort in accordance with the object of the Act;

• To manage the alpine resort in accordance with the object of the Act;

• To contribute to the development of the Alpine Resorts Strategic Plan and other strategic planning for alpine resorts as a whole;

• To undertake research into alpine resort issues;• To contribute to and support the operation of the Alpine

Resorts Co-ordinating Council;• To prepare and implement a Strategic Management Plan

for the resort;• To expend or apply revenue of the Board in accordance

with a direction of the Minister under section 36(1A) of the Act;

• To manage the Crown land in Lake Mountain by acting as a Committee of Management under the Crown Land (Reserves) Act 1978;

• To contribute, together with Tourism Victoria and the Alpine Resorts Co-ordinating Council, to the overall promotion of alpine resorts;

• To develop a tourism and marketing strategy and to promote the resort;

• To collect fees prescribed by the regulations for the resort;

• To attract investment for the improvement of the resort; and

• To carry out any other function conferred on the Board by this or any other Act.

CHARTER AND PURPOSE

CHAR

TER

AND

PU

RPO

SE


Nature and Range of Services

Lake Mountain Alpine Resort Management Board ensures that a number of services are provided in the Resort including:

• Water supply• Sewerage and drainage• Car park development and maintenance• Garbage and waste disposal• Electricity• Commercial operations including products associated with

food and beverage, ski hire, ski school, retail• Snow clearance• Traffi c control and parking• Trail grooming, construction, and maintenance• Ski patrolling• Snowmaking• Snow and weather reporting• Tourism and education information• Public shelters• Toilets


23

Performance Against Objectives

Strategic Objective Key element Outcomes Measures of Performance

1 Arrange a management structure that provides fi nancially sustainable outcomes

Service delivery model

• Management agreement is in place until April 2015.

• Funding arrangements with Department of Environment and Primary Industries are in place and understood, but are to be reviewed in the period leading up to April 2015.

• DELWP operational funding $2,599,234 (2014: $2,464,009) operating result (exe. depreciation and DELWP funding $1,727,689 (2014: $1,580,410).

Long-term asset and investment management

• Proposals of capital investment have been identifi ed, and a repair and maintenance program instigated. Projects to expand the resort activities and snow making are being advanced to funding agencies and potential commercial partners.

• Repairs and maintenance program performed as planned and within budget.

• Investment in snow making equipment undertaken in 2015, with a case to for VARDP support for additional capacity developed and assessed.

2 Achieve excellence in board governance and compliance

Organisational planning, monitoring and reporting

• Board has developed and submitted plans and reports and has monitored performance of the Resort throughout the year.

• Effective sub-committee restructure implemented and good outcomes achieved.

• Financial reports and implementation of ARSP 2012 status report lodged on time with ARCC.

• Strategy, Risk, Governance and the monitoring of performance regularly undertaken.

Policy development and monitoring of performance

• Board has maintained its review and improvement of its suite of policies, and other governance documents.

• Policies in place as required by Public Administration Act 2004 and Directions of Minister of Finance.

• Board performance appraisal program completed.

Compliance • Board’s compliance responsibilities have been fulfi lled.

• Compliant with Financial Management Act and enabling legislation and Standing Directions.

• No known instances of failure to lodge documents and/or information and make payments as required.

3 Improve the experience for visitors coming to Lake Mountain

Business planning and marketing

• Pro-active development of increased range of activities, events and service delivery improvements.

• Winter season visitors was 120,913

• $23.72 spend per visitor in white season

Results of customer satisfaction surveys coordinated by ARCC show an improvement in net promoter score.

Product offer and service

• Reasonable visitation and spend given late start to green season management in 2013-2014 and poor quality of winter season.CH

ARTE

R AN

D P

URP

OSE


Strategic Objective Key element Outcomes Measures of Performance

4 Build partnerships with regional commercial operators and other groups

Stakeholder Engagement

• Strong relationships with the Department, and local Marysville business community and Murrindindi Shire Council.

• Evidence of strong bonds and co-operation.

Partnerships with land managers

• New Parks Victoria agreement being negotiated.

• New agreement has been fi nalized and awaits ratifi cation by respective Boards.

5 Maintain the alpine environment for which it has responsibility

Environmental management

• Environment protected, and consciousness of energy use and desire to minimise.

• In 2015, diesel usage 1.28 litres per white season visitor (1.372litres in 2014).

• In 2015, 0.0011 cubic metres per white season visitor (0.0006 cubic metres in 2014) of waste was removed from the resort.

• Clear Water regulation audit report received and annual report to authorities lodged on time.

6 Fulfi l the community service obligations that the ARMB has accepted

Access, diversity and equity principles

• Resort continues to attract visitors from a diverse range of cultural backgrounds and socio-economic groups.

• No measurement of visitor profi le undertaken, but diversity is evident from observation of visitor population.

Economic contribution to the region

• Resort continues to contribute signifi cantly to the Marysville region.

• No measure of regional economic contribution undertaken in 2014 but impact is recognized.

7 Have clear resort management, risk, development, fi re and emergency plans

Strategic Management Resort Master Planning

• A process to develop a Resort Master Plan process has been followed with stakeholder engagement.

• Completion of Resort Master Plan and Strategic Management Plan is near.

Fire and Emergency Management

• Fire management regime followed, and resort prepared in accordance with Plan for 2014-2015 fi re season.

• Fire plans followed and preparedness checklist completed.

• Signed Community Emergency Management Plan with Murrindindi Shire Council.

Risk Management • Risk Framework reviewed and modifi ed and Profi le of identifi ed risks reassessed.

• WH&S policies reviewed and updated.

• Regular review of Risk Management System was undertaken to the satisfaction of the Board.


25

Initiatives and key achievements

No. Initiative Performance The future

1 Investment in additional snow-making capacity.

Whilst weather conditions were conducive to making snow, the success of this experiment cannot be overstated. To achieve more than 120,000 white season visitors in a season with less than 80 centimetres of natural snow is testimony to the success of this investment. The ability to provide a guaranteed offer of at least two toboggan slopes and an extended informal snow play (non-sliding area) for most of the season was popular amongst families and schools as they forged plans to visit the Alps.

The Board will seek additional funds to invest further in snow -making equipment with a preference for a snow-making plant that has a capacity to make snow in above zero temperatures and to be less negatively impacted by humidity.

2 Increase the array of white season activities for people to enjoy in the resort.

The experiment to provide complimentary mini session for ski lessons to children was deemed to be a success with more than 4,000 visitors participating in the program. Further indicators of success were the increasing numbers of returning visitors to the resort, and the take up of “to be paid for” cross-country ski lessons.

The resort anticipates expanding on the array of “ski school” product offers in coming seasons, to further expose young people to the opportunity of having a go.

3 Encourage private sector investment in green season facilities and events that will be an attraction to potential visitors.

Despite best endeavours this initiative is yet to bear fruit, but the signs are promising if we can provide greater certainty over future management arrangements and strategies to build visitation.

Continue to encourage investment, and to provide a sound investment environment for potential investors to operate.

4 Replace diesel energy generation systems with alternate energy sources.

Whilst feasibility studies were commissioned and received, no cost-effective implementable systems has been identifi ed and settled upon.

Efforts to fi nd an alternate energy source will continue.

CHAR

TER

AND

PU

RPO

SE


Table 5 (b) 1st August, 2015

Table 5 (a) 1st November, 2014

GOVERNANCE AND ORGANISATIONAL STRUCTURE

The Board (LMARMB)

Executive Offi cer (0.2 EFT)

Resort Master Plan and the

Environment


Workplace Safety Committee

The Management Model

The Board re-engaged Belgravia Leisure to manage the operation of the resort. This one-year contract expires at the end of April 2016. The Board also continued to contract Luminous biz to provide administrative services to the Board, to ensure that the Board was able to fulfi l its legislated functions and compliance obligations effectively until the 1st August, 2015, when the Board decided to appoint a Chief Executive Offi cer and Board Secretary as its executive staff team.

Management Agreements and EO Remuneration

Committee


Operations & Accounting services contracted to

Belgravia Leisure

Administration services contracted

to Luminous biz

The Board (LMARMB)

Chief Executive Offi cer (0.8 EFT)

Resort Master Plan and the

Environment


Workplace Safety Committee

Management Agreements and EO Remuneration

Committee


Operations & Accounting services contracted to

Belgravia Leisure

Board secretary (0.4 EFT)


27

Tabl

e 6

Org

anis

atio

nal S

truc

ture

Durin

g th

e co

urse

of t

he y

ear,

Belg

ravi

a Le

isur

e co

ntin

ued

to p

erfo

rm th

e ro

le o

f man

agin

g st

aff e

mpl

oyed

in th

e re

sort.

Som

e st

aff w

orki

ng a

t the

reso

rt re

mai

ned

empl

oyed

by

the

Boar

d, w

hilst

oth

er s

taff

wer

e em

ploy

ed a

nd s

uppl

ied

by B

elgr

avia

Lei

sure

. Sta

ff m

embe

rs a

re e

mpl

oyed

und

er th

e te

rms

of th

e La

ke M

ount

ain

Alpi

ne R

esor

t Wor

kpla

ce A

gree

men

t, w

hich

is d

ue fo

r ren

egot

iatio

n.

GOVE

RNAN

CE A

ND

ORG

ANIS

ATIO

NAL

STR

UCT

URE

1st

Augu

st, 2

015

Reso

rt M

anag

er (F

T)Sc

ott G

ambl

e

Oper

atio

ns M

anag

er (F

T)Br

ett W

einb

erg

Chef

/Bis

tro M

anag

er

(Cas

ual)

Jodi

e Ve

nn

Adm

inis

tratio

n (F

T)

Mar

y-an

n Ne

al

Oper

atio

ns &

Acc

ount

ing

serv

ices

con

tract

ed to

Be

lgra

via

Leis

ure

The

Boar

d (L

MAR

MB)

Chie

f Exe

cutiv

e Of

fi cer

(0.

8 EF

T)Ph

il Nu

nn

Boar

d se

cret

ary

(0.4

EFT

)An

ita H

unte

r

Regi

onal

Alp

ine

Man

ager

Scot

t McD

onal

dCh

ief F

inan

ce O

ffi ce

rEr

ic W

ong

Wor

ksho

p Te

am L

eade

r (F

T)

Jarro

d Ho

skin

s

Build

ing

Mai

nten

ance

Te

am L

eade

r (FT

) Bi

ll M

orris

on

Reso

rt Se

rvic

es O

ffi ce

rs

(PT)

Grae

me

Wei

nber

g

Davi

d Bu

chan

an

Prog

ram

Lea

ders

(C

asua

ls)

Prog

ram

Att

enda

nts

(Cas

uals)

Prog

ram

Man

ager

(FT)

An

drew

Pau

l

Bar A

tten

dant

s (C

asua

ls)

Envi

ronm

enta

l Offi

cer

Sue

Parry

Mar

ketin

g Co

ordi

nato

r (P

T)Tr

udi A

cker

man

Bist

ro A

tten

dant

s (C

asul

as)

Soci

al M

edia

Coo

rdin

ator

(P

T)Jo

nath

on G

ambl

e

Ski S

choo

l & H

ire D

irect

or(F

T-Se

ason

al)

Alan

Eas

on

Ski S

choo

l Ins

truct

ors

(Cas

uals)

Ski H

ire A

tten

dant

s(C

asua

ls)

Reta

il M

anag

er(C

asua

l)Ju

lie G

ambl

e

Reta

il St

aff

(Cas

uals)

The

Boar

d

Belg

ravi

a

Staf

f em

ploy

ed b

y:


Ongoing employeesFixed-term & casual employed during the

season

Fixed-term & casual employed at the end

of year

Number(headcount)

Full time (headcount)

Part time (headcount)

FTE FTE FTE

2015 8 4 4 6.6 - -

2014 7 4 3 5.8 - -

2013 6 4 2 5.6 - -

2012 18 16 2 16.7 101 1

2015 2014

Ongoing Fixed term & casual at end of year

Ongoing Fixed term & casual at end of yearheadcount FTE headcount FTE

Male 7 6.2 0 7 5.8 -

Female 1 0.4 0 - - -

Age

15-25 0 0 0 -

25-34 1 1.0 1 0.8

35-44 1 0.4 1 1.0

45-54 3 3.0 2 1.8

55-64 1 1.4 2 1.2

65 plus 1 0.8 1 1.0

Ongoing employees means people engaged on open-ended contracts of employment, and executives engaged on a standard executive contract who were active in the last full pay period in October.

FTE means full-time staff equivalent.

Workforce Data Disclosures

The following data relates to staff members who remain employed by the Board. Aside from the Executive Offi cer, staff members are managed by Belgravia Leisure. Belgravia employees are not included in the information contained in the table below.

Table 7

Executive Officer Disclosures

The Board has contracts of employment with two executives whose annual total remuneration exceeds $100,000 per annum. The Chief Executive Offi cer remuneration is disclosed in Note 19 (b) of the Annual Financial Statements whilst the remuneration of the other executive is disclosed in Note 19 (d).


29

DISCLOSURE INDEX

Declaration of Pecuniary Interests

A comprehensive register is maintained. This contains details relating to members of the Board and senior Resort staff.

Details of Shares held in Statutory Authority or Subsidiary

Not applicable. There are no shares of this nature in Lake Mountain Alpine Resort.

Consultancies and Contracts

The Board outsourced a signifi cant number of its activities during this year. Contractors engaged included Belgravia Leisure to manage the Resort, and Luminous biz was engaged as project manager of the tender process and also to provide administrative support to the Board to enable it to operate effectively. The quantum of payments made to these contractors is disclosed in Note 19 (iii) of the Notes to the fi nancial statements.

Disclosure of Major Contracts

There were no contracts greater than $10 million entered into by the Board during 2014-15.

Details of Consultancies in Excess of $10,000

Consultant Services providedExpenditure in reporting period

Future commitment

Allens Linklaters Engaged to provide advice and develop contractual documents for the management agreement with the commercial operators.

$16,243 No future commitment

Crowe Howarth Engaged to provide internal audit services, and to provide taxation advice in relation to issue with the ATO.

$16,701 No future commitment, although expectation is that they may continue to act as the Board’s internal audit service providers.

Essential Economics

Engaged to undertake an economic evaluation and draft business cases for proposals to be incorporated into the Lake Mountain Resort Master Plan.

$14,400 No further commitment

Food Consultants Australia

Engaged to report on the food and beverage services provided in the resort and to recommend improvements to improve the quality and profi tability of the offer to visitors.


GHD Engaged to provide engineering advice in respect to the resort’s:• Geo technical management• Fire damaged trees risk• Resort infrastructure to inform the Resort Master Plan.


Millar Merrigan Engaged to provide consultancy advice to assist in the development of a Resort Master Plan.


OTHER INFORMATION

Table 8

OTH

ER IN

FORM

ATIO

N


DETAILS OF CONSULTANCIES UNDER $10,000

There were 2 consultancies, the expenditure on which was less than $10,000. The total expenditure on these consultancies during 2014-15 was $7,300.

Employment and Conduct Principles

Victorian Public Service merit and equity principles are applied in the appointment and management of staff. Lake Mountain Alpine Resort Management Board follows the employment and conduct principles set out in the Public Administration Act 2004.

Belgravia Leisure is contracted by the Board to manage the operation of the resort. A clause in the contractual agreement between the Board and Belgravia Leisure prescribes that Belgravia Leisure is to adhere to values that are consistent with those of the public sector, is to provide appropriate training, and follow employment principles that are consistent with those of the public sector. The Board is satisfi ed that these obligations are being fulfi lled.

Government Advertising Expenditure

Government policy requires disclosure of all Government Advertising Expenditure with a total media buy of $150,000 or greater (exclusive of GST). No Government Advertising Expenditure was incurred by Lake Mountain Alpine Resort Management Board during the reporting period.

Workplace Health and Safety

The Board is responsible for providing a safe working and recreational environment, free from accidents and injuries, for all Board employees, contractors, and visitors to the resort. The Board is committed to ensuring that all people affected by its activities are protected from loss and from risks to safety, health, and wellbeing. The Board works with Belgravia Leisure to ensure that appropriate health and safety measures are in place in the resort.

Reviews of workplace health and safety are conducted regularly, with no signifi cant workplace health and safety issues identifi ed that are yet to be addressed.

The Board has reviewed and adopted amendments to its Workplace Health and Safety Policies, and through its resort management team conducts regular meetings of its Workplace Health and Safety Committee. Outcomes of these meetings are reported to the Board, via the Risk and Governance Committee.

Whilst general training is provided on workplace health and safety, specifi c courses are provided where new equipment is provided for use by the resort operations staff.

The Board monitors monthly reports on workplace and public safety-related injuries. The number and nature of injuries and incidents are similar to those experienced in previous years.

As a result of a workplace incident causing serious injury to a Belgravia employee, WorkSafe issued two Improvement Notices, which have been responded to. Worksafe has subsequently indicated its satisfaction with the proposed improvements outlined in these responses.


31

WH&S Performance Report

Measures KPI 2014-15 2013-14 2012-13

Incidents No. of incidents 6 200 1

Rate per 100 FTE 1.11 0.34 0.17

Claims No. of standard claims 0 0 0

Rate per 100 FTE - - -

No. of lost time claims 0 0 0


No. of claims exceeding 13 weeks 0 0 0


Fatalities Fatality claims 0 0 0

Claim costs Average cost per standard claim 0 0 0

Return to work Percentage of claims with RTW plan <30 days 0 0 0

Management commitment

Evidence of WH&S policy statement, WH&S objectives, regular reporting to senior management of WH&S, and WH&S plans (signed by CEO or equivalent).

Completed Completed Completed

Consultation and participation

Evidence of agreed structure of designated workgroups (DWGs), health and safety representatives (HSRs), and issue resolution procedures (IRPs).


Compliance with agreed structure on DWGs, HSRs, and IRPs.


Risk management Percentage of internal audits/inspections conducted as planned.

75% 100% 100%

Percentage of issues identifi ed actioned arising from:

internal audits; 100% 100% 100%

HSR provisional improvement notices (PINs); and

n/a n/a n/a

WorkSafe notices 100% 0 100%

Training Percentage of managers and staff that have received WH&S training:

• induction; 100% 100% 100%

• management training; and 0 0 0

• contractors, temps, and visitors.

Percentage of HSRs trained:

• acceptance of role; 0 0 0

• re training (refresher); and 0 0 0

• reporting of incidents and injuries. 0 0 0

Table 9


Building Standards

There have been no building and construction activities in the resort during this reporting period.

Buildings in the resort are subject to regular maintenance and use. There is no evidence to suggest that all recently constructed buildings within the resort do not conform to building standards. There have been no major works on these buildings during the reporting period.

The buildings will be subject to regular inspection by resort operations staff and maintenance and rectifi cation works will be carried out as required and identifi ed.

Victorian Industry Participation Policy Disclosures

In October 2003, the Victorian Parliament passed the Victorian Industry Participation Policy Act 2003, which requires public bodies and departments to report on the implementation of the Victorian Industry Participation Policy (“VIPP”). Departments and public bodies are required to apply VIPP in all tenders over $3 million in metropolitan Melbourne and $1 million in regional Victoria.

In 2014-2015 there were no tenders to disclose based on these expenditures.


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APPLICATION AND OPERATION OF FREEDOM OF INFORMATION ACT 1982

Lake Mountain Alpine Resort Management Board is considered to be a Government Agency under the Freedom of Information Act 1982, and as such is required to abide by the requirements of the Act.

The Board comprises individuals who are recognised as having an understanding of alpine issues, and who represent the views of the various sections of the public that have an interest in the Board.

The Board holds and maintains the following categories of documents:

• Correspondence fi les;• Minutes of the various meetings held within the Board;• Technical reports and statistical information on

Lake Mountain Alpine Resort Management Board management matters;

• Leasehold documents related to Lake Mountain Alpine Resort Management Board sites; and

• Plans, charts and other topographical data covering Lake Mountain Alpine Resort Management Board land.

Copies of the Board’s policy statements, annual reports, and general information related to the Board are available for inspection at the Board’s offi ce and/or online at www.lakemountainresort.com.au. This literature is also available by mail at a minimum charge of $27.20.

A person seeking access to a particular document held by the Board can write to the Freedom of Information Offi cer identifi ed below, describing, in as much detail as possible, the nature of the document required, or can make an online request at https://online.foi.vic.gov.au/foi/foi_request_details

An application fee of $27.20 applies at the time of publication. All requests are required to be actioned within 45 days. The Freedom of Information Offi cer is responsible for the processing of these requests to fi nality, and may be contacted as follows:

Freedom of Information OfficerLake Mountain Alpine Resort Management Board

PO Box 40Marysville VIC 3779

Phone: (03) 5957 7201

In the year ended 31 October 2015 there were no freedom of information requests, and there were no outstanding items from previous years.

Compliance with Building Act 1993

There were seven buildings owned by the Board, all

conforming to building standards as at 31 October 2015.

Statement on National Competition Policy

Competitive neutrality is a guiding principle of the National Competition Policy and requires that government-owned businesses should compete with private sector businesses on the same footing. Lake Mountain Alpine Resort Management Board is committed to this principle of the National Competition Policy and applies competitive neutrality policy to all signifi cant activities where the benefi ts of competitive neutrality exceed the costs. This policy has a stated objective to achieve the most effi cient provision of publicly provided goods and services.

Purchases of goods and services are in line with the Victorian Government Purchasing Board’s guidelines. This process ensures that goods and services are purchased at the most competitive prices.

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APPLICATION AND OPERATION OF THE PROTECTED DISCLOSURES ACT 2012

The Protected Disclosure Act 2012 (“PD Act”) enables people to make disclosures about improper conduct by public offi cers and public bodies. The Act aims to ensure openness and accountability by encouraging people to make disclosures and protecting them when they do.

What is a ‘protected disclosure’?

A protected disclosure is a complaint of corrupt or improper conduct by a public offi cer or a public body.

Lake Mountain Alpine Resort Management Board is a “public body” for the purposes of the PD Act.

What is ‘improper or corrupt conduct’?

Improper or corrupt conduct involves substantial:

• mismanagement of public resources; or • risk to public health or safety or the environment; or • corruption.

The conduct must be criminal in nature or a matter for which an offi cer could be dismissed.

How do I make a ‘protected disclosure’?

You can make a protected disclosure about Lake Mountain Alpine Resort Management Board or its board members, offi cers, or employees by contacting Independent Broad-Based Anti-Corruption Commission on the contact details provided below.

Please note that Lake Mountain Alpine Resort Management Board is not able to receive protected disclosures.

How can I access Lake Mountain Alpine Resort Management Board’s procedures for the protection of persons from detrimental action?

DELWP has established procedures for the protection of persons from detrimental action in reprisal for making a protected disclosure about Lake Mountain Alpine Resort Management Board or its employees. You can access DELWP’s procedures on its website at http://www.depi.vic.gov.au/about-us/legislation/protected-disclosures

Contacts

Independent Broad-Based Anti-Corruption Commission (“IBAC”) Victoria:

Address: Level 1, North Tower, 459 Collins Street, Melbourne Victoria 3000.

Mail: IBAC, GPO Box 24234, Melbourne Victoria 3001

Website: www.ibac.vic.gov.au Telephone 1300 735 135

Summary of Environmental Performance

There were no offi ce-based environmental impacts in 2014-15.

Compliance with DataVic Access Policy

Consistent with the DataVic Access Policy issued by the Victorian Government in 2012, the Board intends that data tables that it may produce in the future will be available at http://www.data.vic.gov.au in machine-readable format.

Statement of Availability of Other Information

Information relevant to the headings listed in Financial Reporting Direction 22D of the Financial Management Act 1994 is held at Lake Mountain Alpine Resort Management Board’s offi ce and is available on request, subject to the Freedom of Information Act 1982.

Further information can be obtained in writing from:


PO Box 40Marysville VIC 3779Phone: (03) 5957 7201


35

To ensure that risks are being managed in a consistent manner, public sector entities are required to attest in annual reports that:

• entities have in place risk management processes that complies with the mandatory requirements set out in the Victorian Government Risk Management Framework (2015 Framework);

• these processes are effective in controlling the risks to a satisfactory level; and

• a responsible body or audit committee verifi es that view.

Lake Mountain Alpine Resort Management Board has in place a risk management framework, incorporating a policy and strategy. The risk management framework and risk management plan is reviewed regularly and updated annually.


I, Tony Thompson, certify that Lake Mountain Alpine Resort Management Board has risk management processes that complies with the mandatory requirements of the 2015 Framework of the Victoria Government Risk Management Framework, and an internal control system is in place that enables the Chief Executive Offi cer to understand, manage, and satisfactorily control risk exposures. The Board’s Risk and Governance Committee and Audit and Finance Committee verifi es this assurance and that the risk profi le of Lake Mountain Alpine Resort Management Board has been critically reviewed within the last 12 months.

Tony ThompsonChairpersonLake Mountain Alpine Resort Management Board31 December 2015

General Information Requirements

Section 4.2(g) of the Standing Directions of the Minister for Finance states

‘The report of operations should include qualitative and quantitative information on the operations of the public sector agency and should be prepared on a basis consistent with the fi nancial statements prepared by the public sector agency pursuant to the FMA. This report should provide users with general information about the entity and its activities, operational highlights for the reporting period, future initiatives and other relevant information not included in the fi nancial statements.’

This Annual Report for Lake Mountain Alpine Resort Management Board meets this requirement.


RISK MANAGEMENT COMPLIANCE ATTESTATION

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Sign-off requirement

The attached fi nancial statements for Lake Mountain Alpine Resort Management Board (“the Board”) have been prepared in accordance with Standing Direction 4.2 of the Financial Management Act 1994, applicable Financial Reporting Directions, Australian accounting standards including Interpretations, and other mandatory professional reporting requirements.

We further state that, in our opinion, the information set out in the comprehensive operating statement, balance sheet, statement of changes in equity, cash fl ow statement; and accompanying notes, presents fairly the fi nancial transactions during the year ended 31 October 2015 and fi nancial position of the Board at 31 October 2015.

At the time of signing, we are not aware of any circumstance which would render any particulars included in the fi nancial statements to be misleading or inaccurate.

We authorise the attached fi nancial statements for issue on 31 December 2015.

Tony ThompsonChairpersonLake Mountain Alpine Resort Management Board

Marysville31 December 2015

Philip NunnChief Executive Offi cerLake Mountain Alpine Resort Management Board

Marysville31 December 2015

DECLARATION BY THE CHAIRPERSONAND THE CHIEF EXECUTIVE OFFICER


37 LAKE MOUNTA IN ALP INE RESORT MANAGEMENT BOARD ANNUAL REPORT 2014-2015

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LAKE MOUNTAIN ALPINE RESORT MANAGEMENT BOARD

FINANCIAL STATEMENTS FOR THE

YEAR ENDING 31 OCTOBER 2015


Lake Mountain Alpine Resort Management BoardComprehensive operating statement for the fi nancial year ended 31 October 2015

Lake Mountain Alpine Resort Management Board Comprehensive operating statement for the financial year ended 31 October 2015

2

Notes 2015

$ 2014

$

Income from transactions

Interest revenue 2(a) 32 413 10 078

Visitor fees 2(b) 2 899 125 3 000 761

Government funding and grants 2(c) 2 599 234 2 509 905

Other revenue 2(d) 219 389 113 057

Total income from transactions 5 750 161 5 633 801

Expenses from transactions

Employee benefits 3(a) (560 245) (488 177)

Depreciation expense 3(b) (1 084 880) (1 093 697)

Interest expense 3(c) (2 990) (304)

Contractor expenses 3(d) (1 959 244) (1 929 388)

Purchase of goods and services – operational (806 324) (808 832)

Marketing (203 219) (186 034)

Repairs and maintenance (289 778) (260 949)

Fuel (329 475) (380 277)

Insurance (185 225) (203 937)

Other expenses 3(e) (542 116) (484 416)

Total expenses from transactions (5 963 496) (5 836 011)

Net result from transactions (net operating balance) (213 335) (202 210)

Other economic flows included in net result

Net gains/(losses) on disposal of non-‐financial assets 4 (120 573) (7 888)

Other gains/(losses) from other economic activities 4 (18)

Total other economic flows included in net result (120 591) (7 888)

Net result (333 926) (210 098)

Comprehensive result (333 926) (210 098)

The comprehensive operating statement should be read in conjunction with the notes to the financial statements.


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Lake Mountain Alpine Resort Management Board Balance sheet as at 31 October 2015

3

Notes 2015 $

2014 $

Assets

Financial assets

Cash and deposits 17(a) 1 921 205 1 367 215

Receivables 5 136 275 153 522

Total financial assets 2 057 480 1 520 737

Non-‐financial assets

Inventories 6 57 777 70 951

Prepayments 127 725 127 232

Property, plant and equipment 7 20 169 233 20 996 182

Total non-‐financial assets 20 354 735 21 194 365

Total assets 22 412 215 22 715 102

Liabilities

Payables 8 115 239 251 708

Borrowings 9 35 912 52 875

Provisions 10 226 613 192 142

Total liabilities 377 764 496 725

Net assets 22 034 451 22 218 377

Equity

Accumulated surplus/(deficit) 5 567 584 5 901 510

Physical asset revaluation surplus 18 10 226 415 10 226 415

Contributed capital 12 6 240 452 6 090 452

Net worth 22 034 451 22 218 377

Commitments for expenditure 14 Contingent assets and contingent liabilities 15

The balance sheet should be read in conjunction with the notes to the financial statements.

Lake Mountain Alpine Resort Management BoardBalance sheet as at 31 October 2015

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Lake Mountain Alpine Resort Management Board Statement of changes in equity for the financial year ended 31 October 2015

4

Accumulated

surplus

Physical asset revaluation

surplus

Contributed capital TOTAL

$ $ $ $

Balance at 31 October 2013 6 111 608 10 226 415 6 090 452 22 428 475 Net result for the year

(210 098)

-‐

-‐

(210 098)

Balance at 31 October 2014 5 901 510 10 226 415 6 090 452 22 218 377

Net result for the year (333 926) (333 926)

Capital appropriations 150 000 150 000

Balance at 31 October 2015 5 567 584 10 226 415 6 240 452 22 034 451

The statement of changes in equity should be read in conjunction with the notes to the financial statement.

Lake Mountain Alpine Resort Management BoardStatement of changes in equity for the fi nancial year ended 31 October 2015


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Lake Mountain Alpine Resort Management Board Cash flow statement for the financial year ended 31 October 2015

5

Notes 2015 $

2014 $

Cash flows from operating activities

Receipts Receipts from Government 2 599 234 2 509 905

Receipts in the course of operations 3 448 006 3 426 938

Interest received 32 413 1 462

Total receipts 6 079 653 5 938 305 Cash payments to suppliers for goods and services (2 910 125) (2 488 083) Cash payments to and on behalf of employees (525 774) (490 735) Cash payments to contractors (2 155 169) (2 059 899) Interest paid (2 990) (304) Net GST (paid)/received 313 880 (39 963)

Total payments (5 280 178) (5 078 984)

Net cash flows from/(used in) operating activities 17(b) 799 475 859 321

Cash flows from investing activities Sale of non-‐financial assets 6 500 -‐

Purchase of non-‐financial assets (385 022) (56 743)

Net cash flows from/(used in) investing activities (378 522) (56 743)

Cash flows from financing activities Repayment of borrowings and finance leases (16 963) -‐ Owner contributions by State Government – appropriation for capital expenditure purposes 150 000 -‐

Net cash flows from/(used in) financing activities 133 037 -‐

Net increase/(decrease) in cash and cash equivalents 553 990 802 578

Cash and cash equivalents at beginning of financial year 1 367 215 564 637

Cash and cash equivalents at end of financial year 17(a) 1 921 205 1 367 215

The cash flow statement should be read in conjunction with the notes to the financial statements.

Lake Mountain Alpine Resort Management BoardCash fl ow statement for the fi nancial year ended 31 October 2015

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Lake Mountain Alpine Resort Management Board Notes to the financial statements for the year ended 31 October 2015

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Note 1. Summary of significant accounting policies The Lake Mountain Alpine Resort Management Board (the Board) has been established pursuant to the Alpine Resorts (Management) Act 1997 (“the Act”), which also outlines the functions, responsibilities and requirements of the Board.

The annual financial statements represent the audited general purpose financial statements for the Lake Mountain Alpine Management Board for the period ending 31 October 2015.

The purpose of the financial statements is to provide users with information about the Board’s stewardship of resources entrusted to it.

(a) Statement of compliance

These general purpose financial statements have been prepared in accordance with the financial reporting requirements of the Financial Management Act 1994 (FMA) and applicable Accounting Standards (AASs) which include interpretations, issued by the Australian Accounting Standards Board (AASB). Where appropriate, those AASs paragraphs applicable to not-‐for-‐profit entities have been applied.

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.

These annual financial statements were authorised for issue by the Board on 18 December, 2015.

(b) Basis of accounting preparation and measurement

The accrual basis of accounting has been applied in the preparation of these financial statements whereby assets, liabilities, equity, income and expenses are recognised in the reporting period to which they relate, regardless of when cash is received or paid.

Judgements, estimates and assumptions are required to be made about the carrying values of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on professional judgements derived from historical experience and various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates.

Revisions to accounting estimates are recognised in the period in which the estimate is revised and also in future periods that are affected by the revision. Judgements and assumptions made by management in the application of AASs that have significant effects on the financial statements and estimates, relate to

• the fair value of land, buildings, infrastructure, plant and equipment (refer to Note 1(i)); and • actual assumptions for employee benefit provisions based on likely tenure of existing staff,

patterns of leave claims, future salary movements and future discount rates (refer to Note1(j)).

These financial statements are presented in Australian dollars, and prepared in accordance with the historical cost convention except for:

(i) non-‐financial physical assets which, subsequent to acquisition, are measured at a revalued amount being their fair value at the date of the revaluation less any subsequent accumulated depreciation and subsequent impairment losses. Revaluations are made with sufficient regularity to ensure that the carrying amounts do not materially differ from their fair value.

Lake Mountain Alpine Resort Management BoardNotes to the fi nancial statements for the year ended 31 October 2015


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7

Consistent with AASB 13 Fair Value Measurement, the Board determines the policies and procedures for recurring fair value measurements such as property, plant and equipment in accordance with the requirements of AASB 13 and the relevant Financial Reporting Directions.

All assets for which fair value is measured or disclosed in the financial statements are categorised within the fair value hierarchy, described as follows, based on the lowest level input that is significant to the fair value measurement as a whole:

Level 1 – Quoted (unadjusted) market prices in active markets for identical assets or liabilities

Level 2 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is directly or indirectly observable; and

Level 3 – Valuation techniques for which the lowest level input that is significant to the fair value measurement is unobservable

For the purpose of fair value disclosures, the Board has determined classes of assets on the basis of the nature, characteristics and risks of the asset and the level of the fair value hierarchy as explained above. In addition, the Board determines whether transfers have occurred between levels in the hierarchy by re-‐assessing categorisation (based on the lowest level of input that is significant to the fair valuation measurement as a whole) at the end of each reporting period.

The Valuer-‐General Victoria (VGV) is the Board’s independent valuation agency. The Board, in conjunction with VGV, monitors changes in the fair value through relevant data sources to determine whether revaluation is required.

(c) Reporting entity

The financial statements cover the Board as an individual reporting entity. The Board is an entity established under the Alpine Resorts (Management) Act 1997. Its principal address is:

Lake Mountain Alpine Resort Management Board Lake Mountain Road Lake Mountain VIC 3779

The Board is a public body acting on behalf of the Crown, and reporting to the Department of Environment, Land, Water and Planning.

(d) Scope and presentation of financial statements

Comprehensive operating statement

The comprehensive operating statement comprises two components, being ‘net result from transactions’ (or termed as ‘net operating balance’) and ‘other economic flows included in net result’. The sum of the former two, together with the net result from discontinued operations, represents the net result. The net result is equivalent to profit or loss derived in accordance with AASs.


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‘Other economic flows’ are changes arising from market re-‐measurements. They include:

• gains and losses from disposals, revaluations and impairments of non-‐financial physical and intangible assets;

This classification is consistent with the whole of government reporting format and is allowed under AASB 101 Presentation of Financial Statements. Balance sheet

Assets and liabilities are presented in liquidity order with assets aggregated into financial assets and non-‐financial assets.

Current and non-‐current assets and liabilities are disclosed in the notes, where relevant. In general, non-‐current assets or liabilities are expected to be recovered or settled more than 12 months after the reporting period, except for the provisions of employee benefits, which are classified as current liabilities if the Board does not have the unconditional right to defer the settlement of the liabilities within 12 months after the end of the reporting period.

Cash flow statement

Cash flows are classified according to whether or not they arise from operating, investing, or financing activities. This classification is consistent with requirements under AASB 107 Statement of Cash Flows.

Statement of changes in equity

The statement of changes in equity presents reconciliations of each non-‐owner and owner changes in equity from opening balances at the beginning of the reporting period to the closing balance at the end of the reporting period. It also shows separately changes due to amounts recognised in the “comprehensive result” and amounts related to “transactions with owner in its capacity as owner”.

Rounding of amounts

Amounts in the financial statements (including the notes) have been rounded to the nearest dollar, unless otherwise stated. Figures in the financial statements may not equate exactly due to rounding.

(e) Income from transactions

Income is recognised to the extent that it is probable that the economic benefits will flow to the entity and the income can be reliably measured at fair value.

Interest

Interest income includes interest received on bank and term deposits and other investments. Interest income is recognised using the effective interest method which allocates the interest over the relevant period.



47

Lake Mountain Alpine Resort Management BoardNotes to the fi nancial statements for the year ended 31 October 2015Lake Mountain Alpine Resort Management Board

Notes to the financial statements for the year ended 31 October 2015

9

Income from sale of goods and services

Sale of goods and services is recognised at the point of sale and when services are rendered.

Income from the sale of goods is recognised when:

• the Board no longer has any of the significant risks and rewards of ownership of the goods transferred to the buyer;

• the Board no longer has continuing managerial involvement to the degree usually associated with ownership, nor effective control over the goods sold;

• the amount of income, and the costs incurred or to be incurred in respect of the transactions, can be reliably measured; and

• it is probable that the economic benefits associated with the transaction will flow to the Board.

Visitor fees

Revenue is recognised at the point of sale, when services are rendered.

Government funding and grants

Grants from third parties (other than contributions by owners) are recognised as income in the reporting period in which the Board gains control over the contribution.

For reciprocal grants (i.e. equal value is given back by the Board to the provider), the Board is deemed to have assumed control when the Board has satisfied its performance obligations under the terms of the grant. For non reciprocal grants, the Board is deemed to have assumed control when the grant is receivable or received. Conditional grants may be reciprocal or non reciprocal depending on the terms of the grant.

Grants and contributions for capital works from all sources are recognised as operating revenue when an entitlement is established, and disclosed in the comprehensive operating statement as government grants. However grants and contributions received from the Victorian State Government that are deemed as being in the nature of owner’s contributions, in accordance with FRD 119A Contributions by Owners are accounted for as Equity – Contributed Capital.

Other revenue

Other revenue includes income from fuel tax credits, agreement with a third party for supply of electricity and minor miscellaneous items received outside normal operating revenue.

(f) Expenses from transactions

Expenses are recognised as they are incurred and reported in the financial year to which they relate.

Employee benefits

These expenses include all costs related to the employment of people by the Board including wages and salaries, superannuation, fringe benefits tax, leave entitlements, redundancy payments and WorkCover premiums.

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Superannuation

The amount recognised in the comprehensive operating statement in relation to employer contributions for members of both the defined benefit and defined contribution superannuation plans that are paid or payable to these plans during the reporting period.

The Department of Treasury and Finance (DTF) in their Annual Financial Statements, disclose on behalf of the State as the sponsoring employer, the net defined benefit liability related to the members of these plans as an administered liability. Refer to DTF’s Annual Financial Statements for more detailed disclosures in relation to these plans.

Depreciation

All infrastructure assets, buildings, plant and equipment and other non-‐financial physical assets (excluding items under operating leases and land) that have finite useful lives are depreciated. Depreciation is generally calculated on a straight-‐line basis, at rates that allocate the asset’s value, less any estimated residual value, over its estimated useful life.

The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period, and adjustments made where appropriate.

The following are typical estimated useful lives for the different asset classes used in 2014 and 2015 financial years:

Buildings and improvements 9 – 45 years Trails 17 years

Toboggan runs 17 years Water and sewerage 10 – 30 years

Boardwalks 20 years Roads and car parks 9 – 25 years Plant and machinery 5 – 20 years Office equipment 3 – 10 years

Rental equipment and clothing 3 years

Land, which is considered to have an indefinite life, is not depreciated. Depreciation is not recognised in

respect to land assets because their service potential has not, in any material sense, been consumed during the reporting period.

Interest expense

Interest expense is recognised in the period in which it is incurred and includes:

• bank overdrafts and short-‐term and long-‐term borrowings; • amortisation of ancillary costs incurred in connection with the arrangement of borrowing; and • finance and operating lease charges.

Other expenses

Other operating expenses are recognised as incurred and generally represent the day-‐to-‐day running costs incurred in normal operations.



49


11

Supplies and services

Supplies and services expenses are recognised as an expense in the reporting period in which they are incurred. The carrying amounts of any inventories held for sale or use are expensed when sold or used.

Contractor expenses

As a result of the Short Term Management Project, the Board contracted the operation of the resort to Belgravia Health & Leisure Group Pty Ltd, a private operator. The contractor expenses relating to Belgravia, included the management fee payable to that company, and payment of funds to that company so that it can incur expenses and make payments to acquire goods and services and to remunerate people employed to allow the resort to function.

(g) Other economic flows included in the net result

Other economic flows measure the change in volume or value of assets or liabilities that do not result from transactions.

Net gains/ (losses) on non-‐financial assets

Net gain/ (loss) on non-‐financial assets and liabilities includes realised and unrealised gains and losses as follows:

Revaluation gains/ (losses) of non-‐financial physical assets Refer to Note 1 (i).

Net gains/ (losses) on disposal of non-‐financial assets

Any gain or loss on the disposal of non-‐financial assets is recognised at the date of disposal and is determined after deducting from the proceeds the carrying value of the asset at that time.

Impairment of non-‐financial assets

Assets are assessed annually for indications of impairment, except for inventories and non-‐current physical assets held for sale.

If there is an indication of impairment, the assets concerned are tested as to whether their carrying value exceeds their recoverable amount. Where an asset’s carrying value exceeds its recoverable amount, the difference is written off as an other economic flow, except to the extent that the write-‐down can be debited to an asset revaluation surplus amount applicable to that class of asset.

If there is an indication that there has been a reversal in the estimate of an asset’s recoverable amount since the last impairment loss was recognised, the carrying amount shall be increased to its recoverable amount. The impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised in prior years.

It is deemed that, in the event of the loss or destruction of an asset, the future economic benefits arising from the use of the asset will be replaced unless a specific decision to the contrary has been made. The recoverable amount for most assets is measured at the higher of depreciated replacement cost and fair value less costs to sell. Recoverable amount for assets held primarily to generate net cash inflows is measured at the higher of the present value of future cash flows expected to be obtained from the asset and fair value less costs to sell.


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Refer to Note 1(i) in relation to the recognition and measurement of non-‐financial assets.

Other gains/(losses) from other economic flows

Other gains/(losses) from other economic flows include the gains or losses from the revaluation of the present value of the long service leave liability due to changes in the bond interest rates.

(h) Financial assets

Cash and deposits

Cash and deposits recognised on the balance sheet comprise cash on hand and cash at bank, deposits at call and those highly liquid investments (with an original maturity of three months or less), which are held for the purpose of meeting short term cash commitments rather than for investment purposes, and readily convertible to known amounts of cash with an insignificant risk of changes in value.

For cash flow statement presentation purposes, cash and cash equivalents includes bank overdrafts, which are included as borrowings on the balance sheet.

Receivables

Receivables consist of:

• Contractual receivables, such as debtors in relation to goods and services, loans to third parties, accrued investment income, and finance lease receivables;

• Statutory receivables, such as amounts owing from Victorian Government and Goods and Services Tax (GST) input tax credits recoverable.

Contractual receivables are classified as financial instruments and categorised as loans and receivables. Statutory receivables, are recognised and measured similarly to contractual receivables (except for impairment), but are not classified as financial instruments because they do not arise from a contract.

Receivables are subject to impairment testing as described below. A provision for doubtful receivables is recognised when there is objective evidence that debts may not be collected, and bad debts are written off when identified.

Derecognition of financial assets

A financial asset (or, where applicable, a part of a financial asset or part of a group of similar financial assets) is derecognised when:

• the rights to receive cash flows from the asset have expired; or • the Board retains the right to receive cash flows from the asset, but has assumed an obligation to

pay them in full without material delay to a third party under a ‘pass through’ arrangement; or • the Board has transferred its rights to receive cash flows from the asset and either:

(i) has transferred substantially all the risks and rewards of the asset, or (ii) has neither transferred nor retained substantially all the risks and rewards of the asset, but has

transferred control of the asset.

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


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Impairment of financial assets

At the end of each reporting period, the Board assesses whether there is objective evidence that a financial asset or group of financial assets is impaired. Objective evidence may include financial difficulties of the debtor, default payments, debts which are more than 60 days overdue, and changes in debtor credit ratings. All financial instrument assets, except those measured at fair value through profit or loss, are subject to annual review for impairment.

Bad and doubtful debts for financial assets are assessed on a regular basis. Those bad debts considered as written off by mutual consent are classified as a transaction expense. Bad debts not written off by mutual consent and the allowance for doubtful receivables are classified as ‘other economic flows’ in the net result.

The amount of the allowance is the difference between the financial asset’s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate.

In assessing impairment of statutory (non-‐contractual) financial assets, which are not financial instruments, professional judgement is applied in assessing materiality using estimates, averages and other computational methods in accordance with AASB 136 Impairment of Assets.

(i) Non-‐financial assets

Inventories

Inventories comprise goods held for sale and stores and materials used in the consumption in the ordinary course of resort operations. Inventories are measured at the lower of cost and net realisable value. Cost is measured on the basis of weighted average cost.

Property, plant and equipment

Property, plant and equipment includes land, buildings, roads, infrastructure, plant, equipment, furniture and motor vehicles. Items with a cost or value in excess of $1,000 and a useful life to the Board of more than one year are capitalised. Ski equipment purchased in bulk and used to generate cash inflows from the operation of ski hire and ski school activities is also included in this class of assets.

All non-‐financial physical assets are measured initially at cost and subsequently revalued at fair value less accumulated depreciation and impairment. Where an asset is acquired for no or nominal cost, the cost is its fair value at the date of acquisition. More details about the valuation techniques and inputs used in determining the fair value of non-‐financial physical assets are discussed in Note 7 Property, plant and equipment.

Non-‐financial physical assets such as land are measured at fair value with regard to the property’s highest and best use after due consideration is made for any legal or physical restrictions imposed on the asset, public announcements or commitments made in relation to the intended use of the asset. Theoretical opportunities that may be available in relation to the asset are not taken into account until it is virtually certain that the restrictions will no longer apply. Therefore, unless otherwise disclosed, the current use of these non-‐financial physical assets will be their highest and best uses.

The fair value of infrastructure systems, including roads, and plant, equipment and vehicles, is normally determined by reference to the asset’s depreciated replacement cost.


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The cost of constructed non-‐financial physical assets includes the cost of all materials used in construction, direct labour on the project, and an appropriate proportion of variable and fixed overheads.

The initial cost for non-‐financial physical assets under a finance lease (refer to Note 1(k)) is measured at amounts equal to the fair value of the leased asset or, if lower, the present value of the minimum lease payments, each determined at the inception of the lease.

Subsequent to the initial recognition as assets, all non-‐current physical assets are measured at fair value. Revaluations are made with sufficient regularity to ensure that the carrying amount of each asset does not differ materially from its fair value at the reporting date. Values are assessed annually and supplemented by independent assessments. All assets are tested for indication of impairment on an annual basis. Such assets are tested to ascertain whether the carrying amount exceeds their recoverable amount. Revaluations are conducted in accordance with Financial Reporting Direction (FRD) 103F -‐ Non-‐current physical assets. The most recent formal valuation was undertaken as at 31 October 2011.

Revaluation increments are credited to a revaluation reserve and decreases are recognised as an expense in the comprehensive operating statement. To the extent that a revaluation decrease reverses a revaluation increment previously credited to and still included in the balance of the asset revaluation reserve, the decrease is debited directly to that reserve up to the value of that prior increment.

The revaluation of buildings, roads and infrastructure has been accounted for using the net method whereby the accumulated depreciation at the date of the valuation is eliminated against the carrying amount of the asset with the net difference adjusted directly to the asset revaluation reserve.

The Board undertook a formal revaluation of its land assets at 31 October 2011 using the ‘fair value’ methodology. The revaluation was performed by the Valuer-‐General Victoria. Under fair value the Board’s interest in the Crown’s leasehold land is measured based on a direct market comparison approach, whereby the subject properties are compared to recent land sales. Broad area land values have been applied to the other areas of the Board’s controlled area based on comparable sales evidence methodology. The addition of these values represents the fair value of the land assets under the Board’s control. The figures do not include any improvement values.

The fair value of plant, equipment and vehicles, is normally determined by reference to the asset’s depreciated replacement cost, given the relatively short lives of these assets.

In accounting for the sale of property, plant and equipment only the net profit/(loss) on disposal is shown on the comprehensive operating statement as required under AASs.

For the accounting policy on impairment of non-‐financial physical assets, refer to impairment of non-‐financial assets under Note 1(g) Impairment of non-‐financial assets.

Other non-‐financial assets

Prepayments

Other non-‐financial assets include prepayments which represent payments in advance of receipt of goods or services or that part of expenditure made in one accounting period covering a term extending beyond that period.



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(j) Liabilities

Payables

Payables consist of:

• Contractual payables, such as accounts payable, accrued expenses and unearned income. Accounts payable represent liabilities for goods and services provided to the Board prior to the end of the financial year that are unpaid, and arise when the Board becomes obliged to make future payments in respect of the purchase of those goods and services.

• Statutory payables included in payables mainly consist of goods and services tax and fringe benefits tax payables, and accrued employee expenses.

Contracted payables are classified as financial instruments and are categorised as financial liabilities at amortised cost. Statutory payables are recognised and measured similarly to contractual payables, but are not classified as financial instruments and not included in the category of financial liabilities at amortised cost, because they do not arise from a contract.

Borrowings

Borrowings are initially measured at fair value, being the cost of the borrowings, net of transaction costs (refer also to Note 1(k) Leases).

Subsequent to initial recognition, borrowings are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in net result over the period of the borrowing using the effective interest method.

Provisions

Provisions are recognised when the Board has a present obligation, the future outflow of economic benefits is probable, and the amount of the provision can be measured reliably.

The amount recognised as a liability is the best estimate of the consideration required to settle the present obligation at reporting period, taking into account the risks and uncertainties surrounding the obligation. Where a provision is measured using the cash flows estimated to settle the present obligation, its carrying amount is the present value of those cash flows, using discount rate that reflects the time value of money and risks specific to the provision.

When some or all of the economic benefits required to settle a provision are expected to be received 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.

Employee benefits

Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave and long service leave for services rendered to the reporting date.

(i) Wages and salaries and annual leave

Liabilities for wages and salaries, including non-‐monetary benefits annual leave, are all recognised in the provision for employee benefits as “current liabilities”, because the Board does not have an unconditional right to defer settlements of these liabilities.


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Depending on the expectation of the timing of settlement, liabilities for wages and salaries, annual leave and sick leave are measured at:

• Undiscounted value if the Board expects to wholly settle within 12 months; or • Present value if the Board does not expect to wholly settle within 12 months.

(ii) Long service leave

Liability for long service leave (LSL) is recognised in the provision for employee benefits. Unconditional LSL (representing seven or more years of continuous service) is disclosed as a current liability, even where the Board does not expect to settle the liability within 12 months because it will not have the unconditional right to defer the settlement of the entitlement should an employee take leave within 12 months. The components of this current LSL liability are measured at:

• Undiscounted value if the Board expects to wholly settle within 12 months; and

• Present value if the Board does not expect to wholly settle within 12 months.

Conditional LSL representing less than seven years of continuous service is disclosed as a non-‐current liability. There is an unconditional right to defer the settlement of the entitlement until the employee has completed the requisite years of service. This non-‐current LSL liability is measured at present value.

Consideration is given to expect future wage and salary levels, experience of employee, departures and periods of service. Expected future payments are discounted using a single weighted average discount rate based on market yields of national government bonds in Australia that reflects the estimated timing and amount of benefit payments.

Any gain or loss following revaluation of the present value of non-‐current LSL liability is recognised in the ‘net result from transactions’, except to the extent that a gain or loss arises due to changes in bond interest rates for which it is then recognised in the net result as a other economic flow (refer to note 1(g)).

(iii) Termination benefits

Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts voluntary redundancy in exchange for these benefits. The Board recognises termination benefits when it is demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.

(iv) Employee benefits on-‐costs

Employee benefits on-‐costs (payroll tax, workers compensation and superannuation) are recognised separately from provision for employee benefits.



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17

(k) Leases

A lease is a right to use an asset for an agreed period of time in exchange for payment.

Leases are classified at their inception as either operating or finance leases based on the economic substance of the agreement so as to reflect the risks and rewards incidental to ownership. Leases of property, plant and equipment are classified as finance leases whenever the terms of the lease transfer substantially all the risks and rewards of ownership from the lessor to the lessee. All other leases are classified as operating leases.

Finance leases

The Board as lessee

At the commencement of the lease term, finance leases are initially recognised as assets and liabilities at amounts equal to the fair value of the lease property or, if lower, the present value of the minimum lease payment, each determined at the inception of the lease. The lease asset is depreciated over the shorter of the estimated useful life of the asset or the term of the lease.

Minimum finance lease payments are apportioned between reduction of the outstanding lease liability and periodic finance expense which is calculated using the interest rate implicit in the lease and charged directly to the comprehensive operating statement. Contingent rentals associated with finance leases are recognised as an expense in the period in which they are incurred.

Operating leases

The Board as lessor

Rental income from operating leases would be recognised on a straight-‐line basis over the term of the relevant lease. There is currently no leases of Crown Land within the Lake Mountain Alpine Resort.

The Board as lessee

Operating lease payments, including any contingent rentals, are recognised as an expense in the comprehensive operating statement on a straight-‐line basis over the lease term, except where another systematic basis is more representative of the time pattern of the benefits derived from the use of the leased asset. The leased asset is not recognised in the balance sheet.

(l) Equity

Contributions by owners

Consistent with the requirements of AASB 1004 Contributions, contributions by owners (that is, contributed capital and its repayment) are treated as equity transactions and, therefore, do not form part of the income and expenses of the Board.

Additions to net assets which have been designated as contributions by owners are recognised as contributed capital. Other transfers that are in the nature of contributions or distributions have also been designated as contributions by owners.

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(m) Commitments

Commitments for future expenditure include operating and capital commitments arising from contracts. These commitments are disclosed by way of a note (refer to Note 14) at their nominal value and inclusive of the GST payable.

(n) Contingent assets and contingent liabilities

Contingent assets and contingent liabilities are not recognised in the balance sheet, but are disclosed by way of a note (refer to Note 15) and, if quantifiable, are measured at nominal value. Contingent assets and liabilities are presented inclusive of GST receivable or payable respectively.

(o) Accounting for the goods and services tax (GST)

Income, expenses and assets are recognised net of the amount of associated GST, unless the GST incurred is not recoverable from the taxation authority. In this case, it is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the taxation authority is included with other receivables or payables in the balance sheet.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to the taxation authority, are presented as operating cash flow.

(p) Income tax

The Board is exempt from income tax pursuant to section 50 of the Income Tax Assessment Act 1997.

(q) Events after the reporting period

Assets, liabilities, income or expenses arise from past transactions or other past events. Where the transactions result from an agreement between the Board and other parties, the transactions are only recognised when the agreement is irrevocable at or before the end of the reporting period.

Adjustments are made to amounts recognised in the financial statements for events which occur after the reporting period and before the date the financial statements are authorised for issue, where those events provide information about conditions which existed in the reporting period. Note disclosure is made about events between the end of the reporting period and the date the financial statements are authorised for issue where the events relate to conditions which arose after the end of the reporting period and which may have a material impact on the results of subsequent reporting periods.



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(r) Going concern

These financial statements have been prepared on a going concern basis despite the material uncertainty relating to the Minister for Environment, Climate Change & Water’s announcement of the government’s intent to merge the Lake Mountain and Mt Baw Baw boards, subject to enabling legislation being passed by parliament. It is expected that this legislation will be introduced into parliament in 2016. The Lake Mountain Alpine Resort Management Board will continue to operate as a going concern until such time as this decision is enacted, and subject to the undertaking by the Department of Environment, Land, Water & Planning to continue to fund any shortfall in essential operating expenditures not covered by revenues generated by the Board in managing the operations of the Lake Mountain Alpine Resort.

(s) Australian Accounting Standards issued that are not yet effective

Certain new AASs have been published that are not mandatory for the 31 October 2015 reporting period. The Department of Treasury and Finance assesses the impact of these new standards and advises the Board of their applicability and early adoption where applicable.

As at 31 October 2015, all new accounting standards and interpretations that had been issued but classified as not mandatory for the financial year ended 31 October 2015 had been considered, and while the impact of some standards was still to be assessed, the likely impact is not considered to be significant.


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Standard/Interpretation Summary Applicable for annual reporting periods beginning on

Impact on public sector entity financial statements

AASB 9 Financial instruments

The key changes include the simplified requirements for the classification and measurement of financial assets, a new hedging accounting model and a revised impairment loss model to recognise impairment losses earlier, as opposed to the current approach that recognises impairment only when incurred.

1 Jan 2018 The assessment has identified that the financial impact of available for sale (AFS) assets will now be reported through other comprehensive income (OCI) and no longer recycled to the profit and loss. While the preliminary assessment has not identified any material impact arising from AASB 9, it will continue to be monitored and assessed.

AASB 14 Regulatory Deferral Accounts

AASB 14 permits first-‐time adopters of Australian Accounting Standards who conduct rate-‐regulated activities to continue to account for amounts related to rate regulation in accordance with their previous GAAP.

1 Jan 2016 The assessment has indicated that there is no expected impact, as those that conduct rate-‐regulated activities have already adopted Australian Accounting Standards.

AASB 15 Revenue from Contracts with Customers

The core principle of AASB 15 requires an entity to recognise revenue when the entity satisfies a performance obligation by transferring a promised good or service to a customer.

1 Jan 2017 (Exposure Draft 263 – potential deferral to 1 Jan 2018)

The changes in revenue recognition requirements in AASB 15 may result in changes to the timing and amount of revenue recorded in the financial statements. The Standard will also require additional disclosures on service revenue and contract modifications. A potential impact will be the upfront recognition of revenue from licenses that cover multiple reporting periods. Revenue that was deferred and amortised over a period may now need to be recognised immediately as a transitional adjustment against the opening returned earnings if there are no former performance obligations outstanding.

AASB 2014 1 Amendments to Australian Accounting Standards [Part E Financial Instruments]

Amends various AASs to reflect the AASB's decision to defer the mandatory application date of AASB 9 to annual reporting periods beginning on or after 1 January 2018 as a consequence of Chapter 6 Hedge Accounting, and to amend reduced disclosure requirements.

1 Jan 2018 This amending standard will defer the application period of AASB 9 to the 2018-‐19 reporting period in accordance with the transition requirements.

AASB 2014 4 Amendments to Australian Accounting Standards – Clarification of Acceptable Methods of Depreciation and Amortisation [AASB 116 & AASB 138]

Amends AASB 116 Property, Plant and Equipment and AASB 138 Intangible Assets to: • establish the principle for the basis of depreciation and amortisation as being the expected pattern of consumption of the future economic benefits of an asset; • prohibit the use of revenue based methods to calculate the depreciation or amortisation of an asset, tangible or intangible, because revenue generally reflects the pattern of economic benefits that are generated from

1 Jan 2016 The assessment has indicated that there is no expected impact as the revenue-‐based method is not used for depreciation and amortisation.



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Standard/Interpretation Summary Applicable for annual reporting periods beginning on

Impact on public sector entity financial statements

operating the business, rather than the consumption through the use of the asset.

AASB 2015 6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-‐for-‐Profit Public Sector Entities [AASB 10, AASB 124 & AASB 1049]

The Amendments extend the scope of AASB 124 Related Party Disclosures to not-‐for-‐profit public sector entities. A guidance has been included to assist the application of the Standard by not-‐for-‐profit public sector entities.

1 Jan 2016 The amending standard will result in extended disclosures on the entity's key management personnel (KMP), and the related party transactions.

In addition to the new standards and amendments above, the AASB has issued a list of other amending standards that are not effective for the 2014-‐15 reporting period (as listed below). In general, these amending standards include editorial and references changes that are expected to have insignificant impacts on public sector reporting.

• AASB 2010-‐7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010).

• AASB 2013-‐9 Amendments to Australian Accounting Standards – Conceptual Framework, Materiality and Financial Instruments

• AASB 2014 1 Amendments to Australian Accounting Standards [PART D – Consequential Amendments arising from AASB 14 Regulatory Deferral Accounts only]

• AASB 2014 5 Amendments to Australian Accounting Standards arising from AASB 15 • AASB 2014 7 Amendments to Australian Accounting Standards arising from AASB 9 (December

2014) • AASB 2014 8 Amendments to Australian Accounting Standards arising from AASB 9 (December

2014) – Application of AASB 9 (December 2009) and AASB 9 (December 2010) [AASB 9 (2009 & 2010)]

• AASB 2015 2 Amendments to Australian Accounting Standards – Disclosure Initiative: Amendments to AASB 101 [AASB 7, AASB 101, AASB 134 & AASB 1049]

• AASB 2015 3 Amendments to Australian Accounting Standards arising from the Withdrawal of AASB 1031 Materiality


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Note 2. Income from transactions

2015 $

2014 $

Revenue includes: (a) Interest revenue

Interest on bank deposits 32 413 10 078

Total interest revenue 32 413 10 078

(b) Visitor fees Resort entry fees 1 371 342 1 412 743

Bistro and functions 653 258 746 678

Ski hire and ski school 624 975 620 867

Merchandise 214 494 180 991

Adventure activities 33 125 31 100

Miscellaneous revenue 1 931 8 382

Total visitor fees 2 899 125 3 000 761

(c) Government funding and grants

Department of Environment, Land, Water and Planning support payments 2 599 234 2 464 009

Auspiced program funding -‐ 45 896

Total Government funding and grants 2 599 234 2 509 905

(d) Other revenue

Telecommunications tower electricity supply 26 282 25 761

Fuel Tax credit rebate 93 391 84 896

Other revenue 99 716 2 400

Total other revenue 219 389 113 057



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Note 3. Expenses from transactions

Notes 2015 $

2014 $

(a) Employee benefits

Salaries, wages annual leave and long service leave 490 638 430 558

Post employment benefits Defined contribution superannuation expense 28 747 28 721

Defined benefit superannuation expense 13 814 14 133

Other – Fringe Benefit Tax and Payroll Tax 27 046 14 765

Total employee benefits 560 245 488 177

(b) Depreciation expense

Buildings and improvements 295 320 249 306

Water and sewerage 19 355 19 358

Roads and car parks 315 912 310 716

Plant and machinery 295 404 360 628

Office equipment 8 273 25 221

Rental equipment and clothing 45 516 23 934

Toboggan runs 3 528 3 468

Trails 93 472 92 556

Boardwalks 8 100 8 510

Total depreciation expense 1 084 880 1 093 697

(c) Interest expense

Hire purchase interest 2 990 304

Total interest expense 2 990 304

(d) Contractor expense

Resort Management Agreement (1) 1 782 937 1 465 514

Long term management project -‐ 316 351

Other operational, financial & administrative support 176 307 147 523

Total contractor expense 1 959 244 1 929 388

(e) Other expenses

Audit fees 75 804 63 730

Motor vehicle lease 113 394 119 129

Geotech expenses 96 458 9 724

Auspiced programs 65 736 102 816

Other expenses from ordinary activities 190 724 189 017

Total other expenses 542 116 484 416

Notes:

(1) Payments to Belgravia Health & Leisure Group Pty Ltd include monthly management fees and provision of funds to Belgravia for expenses to be incurred that are directly associated with the operation of the resort (to resort employees and external suppliers).


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Note 4. Other economic flows included in net result

2015 $

2014 $

Net gain/(loss) on non-‐financial assets

Net gain/(loss) on disposal of physical assets (36 916) (7 888)

Net gain/(loss) on impairment of physical assets (83 657)

Total other economic flows included in net result (120,573) (7 888)

Other gains/(losses) from other economic flows

Net gain/(loss) arising from revaluation of long service liability (18) -‐

Total other gains/(losses) from other economic flows (18) -‐

Note 5. Receivables

2015 $

2014 $

Current

Contractual Debtors 92 289 47 288

Sundry debtors 15 171 8 615

107 460 55 903

Statutory Receivable from ATO 28 815 97 619

Total current receivables 136 275 153 522

Total receivables 136 275 153 522

Maturity analysis of contractual receivables Please refer to Note 16(a) for the maturity analysis of contractual receivables.

Note 6. Inventories

2015 $

2014 $

Supplies and consumables – at cost 17 228 23 824

Inventories held – at cost for sale – at cost 40 549 47 127

Total inventories 57 777 70 951



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Note 7. Property, plant & equipment (a) Gross carrying amount and accumulated depreciation

2015

$ 2014

$ Land at fair value Gross carrying amount 4 090 000 4 090 000 Net carrying amount 4 090 000 4 090 000 Trails at fair value Gross carrying amount 1 538 000 1 600 000 Accumulated depreciation (357 336) (277 668) Net carrying amount 1 180 664 1 322 332 Toboggan runs at fair value Gross carrying amount 60 000 60 000 Accumulated depreciation (13 932) (10 404) Net carrying amount 46 068 49 596 Buildings at fair value Gross carrying amount 12 082 723 12 088 798 Accumulated depreciation (1 042 470) (747 565) Net carrying amount 11 040 253 11 341 233 Water and sewerage infrastructure at fair value Gross carrying amount 502 500 502 500 Accumulated depreciation (77 429) (58 072) Net carrying amount 425 071 444 428 Boardwalks at fair value Gross carrying amount 169 305 169 305 Accumulated depreciation (32 114) (24 014) Net carrying amount 137 191 145 291 Roads and car parks at fair value Gross carrying amount 3 086 000 3 086 000 Accumulated depreciation (1 248 060) (932 148) Net carrying amount 1 837 940 2 153 852 Plant and machinery at fair value Gross carrying amount 3 080 588 3 518 234 Accumulated depreciation (1 817 291) (2 156 100) Net carrying amount 1 263 297 1 362 134 Office equipment at fair value Gross carrying amount 57 757 322 395 Accumulated depreciation (46 685) (279 228) Net carrying amount 11 072 43 167


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2015

$ 2014

$ Rental equipment and clothing at fair value Gross carrying amount 213 056 386 689 Accumulated depreciation (75 379) (342 540) Net carrying amount 137 677 44 149 Total gross carrying amount 24 879 929 25 823 921 Total accumulated depreciation (4 710 696) (4 827 739) Total property, plant & equipment 20 169 233 20 996 182



65

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-(5

268

)(2

261

)(3

59)

(7 8

86)

Rev

alua

tion

--

--

--

--

--

-D

epre

ciat

ion

expe

nse

-(2

49 3

06)

(92

556)

(3 4

68)

(19

358)

(8 5

10)

(310

716

)(3

60 6

28)

(25

221)

(23

934)

(1 0

93 6

97)

Clo

sing

bal

ance

4 09

0 00

011

341

233

1 32

2 33

249

596

444

428

145

291

2 15

3 85

21

362

134

43 1

6744

149

20 9

96 1

82

Lake

Mou

ntai

n Al

pine

Res

ort M

anag

emen

t Boa

rdN

otes

to th

e fi n

anci

al s

tate

men

ts fo

r the

yea

r end

ed 3

1 Oc

tobe

r 201

5

FIN

ANCI

AL S

TATE

MEN

TS F

OR

THE

YEAR

EN

DIN

G 31

OCT

OBE

R 20

15


Lake

Mou

ntain Alpine

Resort M

anag

emen

t Boa

rd

Notes to

the fin

ancial st

atem

ents fo

r the

yea

r end

ed 31 Octob

er 201

5

28

(d) Fa

ir va

lue mea

suremen

t hierarchy

for a

ssets as at 3

1 Octob

er 201

5

Carrying

am

ount

as a

t 31

Oct 201

5

Fair

value m

easu

rem

ent a

t end

of r

epor

ting

perio

d us

ing:

Carrying

am

ount

as a

t 31

Oct 201

4

Fair

value m

easu

rem

ent a

t end

of r

epor

ting

perio

d us

ing:

Leve

l 1

Leve

l 2

Leve

l 3

Leve

l 1

Leve

l 2

Leve

l 3

La

nd at f

air v

alue

Spe

cialise

d land

2 85

5 00

0 -‐

-‐ 2 85

5 00

0 2 85

5 00

0 -‐

-‐ 2 85

5 00

0

N

on-‐spe

cialise

d land

1 23

5 00

0 -‐

1 23

5 00

0 -‐

1 23

5 00

0 -‐

1 23

5 00

0 -‐

To

tal o

f lan

d at fa

ir va

lue

4 09

0 00

0 -‐

1 23

5 00

0 2 85

5 00

0 4 09

0 00

0 -‐

1 23

5 00

0 2 85

5 00

0

Build

ings

at f

air v

alue

Spe

cialise

d bu

ildings

11

040

253

-‐

-‐ 11

040

253

11

341

233

-‐

-‐ 11

341

233

To

tal o

f buildings at fair v

alue

11

040

253

-‐

-‐ 11

040

253

11

341

233

-‐

-‐ 11

341

233

Plan

t, eq

uipm

ent a

nd veh

icles a

t fair v

alue

Plant

and

mac

hine

ry

1 26

3 29

7 -‐

-‐ 1 26

3 29

7 1 36

2 13

4 -‐

-‐ 1 36

2 13

4

O

ffice

equ

ipm

ent

11 072

-‐

-‐ 11

072

43

167

-‐

-‐ 43

167

Ski equ

ipm

ent

137 67

7 -‐

-‐ 13

7 67

7 44

149

-‐

-‐ 44

149

To

tal o

f plant, e

quipmen

t and

veh

icles at

fair va

lue

1 41

2 04

6 -‐

-‐ 1 41

2 04

6 1 44

9 45

0 -‐

-‐ 1 44

9 45

0

In

fras

truc

ture

at f

air v

alue

Tr

ails

1 18

0 66

4 -‐

-‐ 1 18

0 66

4 1 32

2 33

2 -‐

-‐ 1 32

2 33

2

To

bogg

an ru

ns

46 068

-‐

-‐ 46

068

49

596

-‐

-‐ 49

596

W

ater

38

2 79

3 -‐

-‐ 38

2 79

3 39

8 97

1 -‐

-‐ 39

8 97

1

Se

wer

age

42 278

-‐

-‐ 42

278

45

457

-‐

-‐ 45

457

Bo

ardw

alks

137 19

1 -‐

-‐ 13

7 19

1 14

5 29

1 -‐

-‐ 14

5 29

1

Ro

ads a

nd car

par

ks (s

ealed)

1 51

8 82

0 -‐

-‐ 1 51

8 82

0 1 81

9 56

4 -‐

-‐ 1 81

9 56

4

Ro

ads a

nd car

par

ks (u

nsea

led)

31

9 12

0 -‐

-‐ 31

9 12

0 33

4 28

8 -‐

-‐ 33

4 28

8

Total of infrastructure at fa

ir va

lue

3 62

6 93

4 -‐

-‐ 3 62

6 93

4 4 11

5 49

9 -‐

-‐ 4 11

5 49

9

Total assets

20,169

,233

-‐

1 23

5 00

0 18

934

233

20

996

182

-‐

1 23

5 50

0 19

760

682

Lake

Mou

ntai

n Al

pine

Res

ort M

anag

emen

t Boa

rdN

otes

to th

e fi n

anci

al s

tate

men

ts fo

r the

yea

r end

ed 3

1 Oc

tobe

r 201

5


67


29

There have been no transfers between levels during the period.

Specialised land and specialised buildings

Specialised land is valued using the market approach, adjusted for the community service obligation (CSO) to reflect the specialised nature of the land being valued.

The CSO adjustment is a reflection of the value’s assessment of the impact of restrictions associated with an asset to the extent that it is also equally attributable to market participants. This approach is in light of the highest and best use consideration required for fair value measurement, and takes into account the use of the asset that is physically possible, legally permissible and financially feasible. As adjustments of CSO are considered as significant unobservable inputs specialised land would be classified as level 3 assets.

Specialised buildings are valued using the depreciated replacement cost method, adjusting for the associated depreciations. As depreciation adjustments are unobservable in nature, specialized buildings are classified as Level 3 fair value measurements.

An independent valuation of specialized land and building was performed by the Valuer-General Victoria. The effective date of the valuation is 31 October 2011.

Fair value assessment is conducted each year. The Board considered the movement in indices provided by the Valuer-General Victoria in order to determine whether any material movements in value have occurred since this date and is comfortable that the values stated in these financial statements approximate fair value.

Non-specialised land

Non-specialised land is valued using the market approach. Under the market approach, the assets are compared to recent comparable sales or sales of comparable assets, which are considered to have nominal or no added improvement value. The valuation of such assets is performed by analyzing comparable sales and allowing for share, size, topography, location and other relevant factors specific to the asset being valued.

An independent valuation of non-specialised land was performed by the Valuer-General Victoria. The effective date of the valuation is 31 October 2011.

To the extent that non-specialised land does not contain significant, unobservable adjustments, these assets are classified as Level 2 based on the existence of key observable inputs under the market approach.

Infrastructure

Infrastructure assets, including roads, trails, toboggan runs, water and sewerage, and boardwalks, are valued using the depreciated replacement cost method. This cost represents the replacement cost of the building/component after applying depreciation rates on a useful life basis. Replacement costs relate to costs to replace the current service capacity of the asset. Economic obsolescence has also been factored into the depreciated replacement cost calculation.

An independent valuation of the Board’s infrastructure assets was performed by the Valuer-General Victoria. The valuation was performed based on the depreciated replacement costs of the assets. The effective date of the valuation is 31 October 2011.

The Board assesses the fair value of its infrastructure assets annually by considering the movement in the Output Price Index of Construction Industries and the Producer Price Index published by the Australian Bureau of Statistics in order to determine whether any material movements in value have occurred since the last valuation date and is comfortable that the values stated in these financial statements approximate fair value.

Plant and equipment

Plant and equipment including plant, machinery, office equipment and ski equipment are held at fair value. When plant and equipment is specialised in use, such that it is rarely sold other than as part of a going concern, fair value is determined using the depreciated cost method.

There were no changes in valuation techniques throughout the period to 31 October 2015.

For assets measured at fair value, the current use is considered the highest and best use.


FIN

ANCI

AL S

TATE

MEN

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OR

THE

YEAR

EN

DIN

G 31

OCT

OBE

R 20

15


Lake M

ountain Alpine

Resort M

anagem

ent B

oard

Notes to

the fin

ancial statem

ents fo

r the

year e

nded

31 Octob

er 2015

30

(e) R

econ

ciliatio

n of Level 3 fa

ir value

La

nd a

t fa

ir va

lue

B

uild

ings

at

fair

valu

e

Trai

ls a

t fa

ir va

lue

Tobo

ggan

ru

ns a

t fa

ir va

lue

Wat

er a

t fa

ir va

lue

Se

wer

age

at fa

ir va

lue

Boa

rdw

alks

at

fair

valu

e

Roa

ds &

ca

r par

ks

(sea

led)

at

fair

valu

e

R

oads

& c

ar

park

s (u

nsea

led)

at

fair

valu

e

Plan

t &

mac

hine

ry a

t fa

ir va

lue

Offi

ce

equi

pmen

t at

fair

valu

e

Ren

tal

equi

pmen

t an

d cl

othi

ng a

t fa

ir va

lue

Tota

l

$

$

$

$

$

$ $

$

$

$

$

$

$

2015

Ope

ning

bal

ance

2

855

000

11 3

41 2

33

1 32

2 33

2 49

596

39

8 97

1 45

457

14

5 29

1 1

819

564

334

288

1 36

2 13

4 43

167

44

149

19

761

182

Pur

chas

es (s

ales

) -

(5 6

60)

- -

- -

- -

- 22

2 71

0 (1

4 50

4)

139

044

341

590

Tran

sfer

s in

(out

) of

Leve

l 3

- -

- -

- -

- -

- -

- -

-

Dep

reci

atio

n -

(295

320

) (9

3 47

2)

(3 5

28)

(16

178)

(3

179

) (8

100

) (3

00 7

44)

(15

168)

(2

95 4

04)

(8 2

73)

(45

516)

(1

084

882

)

Impa

irmen

t Los

s -

- (4

8 19

6)

- -

- -

- -

(26

143)

(9

318

) -

(83

657)

Subt

otal

2

855

000

11 0

40 2

53

1 18

0 66

4 46

068

38

2 79

3 42

278

13

7 19

1 1

518

820

319

120

1 26

3 29

7 11

072

13

7 67

7 18

934

233

Rev

alua

tion

- -

- -

- -

- -

- -

- -

-

Clo

sing

bal

ance

2

855

000

11 0

40 2

53

1 18

0 66

4 46

068

38

2 79

3 42

278

13

7 19

1 1

518

820

319

120

1 26

3 29

7 11

072

13

7 67

7 18

934

233

2014

Ope

ning

bal

ance

2

855

000

11 5

90 5

39

1 41

4 88

8 53

064

41

5 14

8 48

638

14

2 45

7 2

115

376

349

192

1 65

7 04

7 68

322

43

477

20

753

148

Pur

chas

es (s

ales

) -

- -

- -

- 11

344

-

- 65

,715

66

24

606

10

1 73

1 Tr

ansf

ers

in(o

ut) o

f Le

vel 3

-

- -

- -

- -

- -

- -

- -

Dep

reci

atio

n -

(249

306

) (9

2 55

6)

(3 4

68)

(16

177)

(3

181

) (8

510

) (2

95 8

12)

(14

904)

(3

60 6

28)

(25

221)

(2

3 93

4)

(1 0

93 6

97)

Impa

irmen

t Los

s -

- -

- -

- -

- -

- -

- -

Subt

otal

2

855

000

11 3

41 2

33

1 32

2 33

2 49

596

39

8 97

1 45

457

14

5 29

1

1 81

9 56

4 33

4 28

8 1

362

134

43 1

67

44 1

49

19 7

61 1

82

Rev

alua

tion

- -

- -

- -

- -

- -

- -

-

Clo

sing

bal

ance

2

855

000

11 3

41 2

33

1 32

2 33

2 49

596

39

8 97

1 45

457

14

5 29

1 1

819

564

334

288

1 36

2 13

4 43

167

44

149

19

761

182

Lake

Mou

ntai

n Al

pine

Res

ort M

anag

emen

t Boa

rdN

otes

to th

e fi n

anci

al s

tate

men

ts fo

r the

yea

r end

ed 3

1 Oc

tobe

r 201

5


69


31

(f) Description of significant unobservable inputs to Level 3 valuations

Valuation Technique

Significant unobservable inputs

Specialised Land Market approach Community Service Obligation (CSO) adjustment

Specialised buildings Depreciated replacement cost Replacement cost per square metre

Useful life of specialised buildings

Plant and machinery Depreciated replacement cost Cost per unit

Useful life of plant and machinery

Office equipment Depreciated replacement cost Cost per unit

Useful life of office equipment

Rental equipment and clothing

Depreciated replacement cost Cost per unit

Useful life of ski equipment

Trails Depreciated replacement cost Cost per km

Useful life of the trails

Toboggan runs Depreciated replacement cost Cost per unit

Useful life of the toboggan runs

Water Infrastructure Depreciated replacement cost Cost per unit

Useful life of the water infrastructure

Sewerage Infrastructure Depreciated replacement cost Cost per unit

Useful life of the sewerage infrastructure

Roads and Car Parks (sealed)


Useful life of the roads and car parks

Roads and Car Parks (unsealed)


Boardwalks Depreciated replacement cost Cost per unit

Useful life of the boardwalks


FIN

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EN

DIN

G 31

OCT

OBE

R 20

15



32

Note 8. Payables

2015

$ 2014

$ Current payables Contractual Creditors -‐ 64 085 Other payables and accruals 101 881 142 415

Total contractual Payables 101 881 206 500

Statutory PAYG Withholding payable 9 958 6 791

Superannuation payable 2 244 3 387

Employee deductions -‐ 30

GST Payable 1 156 35 000

Total statutory payables 13 358 45 208

Total payables 115 239 251 708

Maturity analysis of contractual payables Please refer to Note 16(b) for the maturity analysis of contractual payables.

Note 9. Borrowings

2015

$ 2014

$

Current borrowings Finance lease liabilities 18 179 16 963

Total current borrowings 18 179 16 963

Non-‐current borrowings

Finance lease liabilities 17 733 35 912

Total non-‐current borrowings 17 733 35 912

Total borrowings 35 912 52 875

Notes: Finance lease is secured against Plant & Equipment (an excavator).



71


33

Note 10. Provisions

2015

$ 2014

$ Current provisions

Annual Leave Unconditional and expected to settle within 12 months (ii) 44 497 59 675

Unconditional and expected to settle after 12 months (iii) 22 174

Long Service Leave Unconditional and expected to settle after 12 months (iii) 99 567 83 118 Provisions related to employee benefit on-‐costs Unconditional and expected to settle within 12 months (ii) 6 832 6 250

Unconditional and expected to settle after 12 months (iii) 19 243 8 784

Total current provisions 192 313 157 827

Non-‐current provisions Employee benefits (iii) 29 592 30 406 Employee benefits on costs 4 708 3 909

Total non-‐current provisions 34 300 34 315

Total provisions 226 613 192 142

(a) Employee benefits and related on-‐costs

2015 $

2014 $

Current employee benefits

Annual leave entitlements 66 671 59 675

Long service leave entitlements 99 567 83 118

Non-‐current employee benefits Long service leave entitlements 29 592 30 406


Current on-‐costs 26 075 15 034

Non-‐current on-‐costs 4 708 3 909

Total on-‐costs 30 783 18 943

Total employee benefits and related on-‐costs 226 613 192 142

Notes:

(i) Provisions for employee benefits consist of amounts for annual leave and long service leave accrued by employees, not including on costs.

(ii) The amounts disclosed are nominal amounts. (iii) The amounts disclosed are discounted to present values.


FIN

ANCI

AL S

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TS F

OR

THE

YEAR

EN

DIN

G 31

OCT

OBE

R 20

15



34

(b) Movement in provisions (on-‐costs)

2015 $

2014 $

Opening balance 18 943 18 878

Additional provisions recognised 18 454 3 039

Reductions arising from payments/other sacrifices of future economic benefits (5 570) (3 073)

Reductions arising from re-‐measurement or settlement without cost (1 026) -‐

Effect of change in discount rates (18) 99


Current 26 075 6 251

Non-‐current on-‐costs 4 708 12 692

30 783 18 943

Note 11. Superannuation Employees of the Board are entitled to receive superannuation benefits and the Board contributes to both defined benefit and defined contribution plans. The defined benefit plans provide benefits based on years of service and final average salary.

The Board does not recognise any defined benefit liability in respect of the plans because the Board has no legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as they fall due. The Department of Treasury and Finance discloses the State’s defined benefit liabilities in its disclosure for administered items. However, superannuation contributions paid or payable for the reporting period are included as part of employee benefits in the comprehensive operating statement of the Board.

The name, details and amounts expensed in relation to the major employee superannuation funds and contributions made by the Board are as follows:

Fund Contribution Rate

Paid Contribution Contribution Outstanding

for the Year at Year End

2015 $

2014 $

2015 $

2014 $

Defined benefit plans:

ESSS 3% -‐ 17% 13 814 14 133 -‐ 296

Defined contribution plans:

BT 9.25-‐9.5% 4 649 1 131 1 241 175

Culhane Super Fund 9.25-‐9.5% -‐ -‐ -‐ 78

ESSS 9.25-‐9.5% -‐ -‐ -‐ 1 087

First Superannuation 9.25-‐9.5% 3 229 3 705 -‐ 217

Mithason Superannuation 9.25-‐9.5% -‐ -‐ -‐ 50

MTAA Super Fund 9.25-‐9.5% 4 826 4 639 -‐ 352

Vic Super 9.25-‐9.5% 13 068 18 109 385 1 132

Vision Super 9.25-‐9.5% 645 -‐ 260 -‐

Other 9.25-‐9.5% 2 330 1 137 358 -‐

Total 42 561 42 854 2 244 3 387

There are no loans from any of the above funds to the Board as at 31 October 2015 (2014 – Nil).



73


35

Note 12. Contributed capital On 30 April 1998 the Alpine Resorts Commission was dissolved and, pursuant to Section 59 of the Alpine Resort (Management) Act 1997, seven (7) bodies were established in its place. The assets, rights and obligations applicable to Lake Mountain Alpine Resort Management Board to the value of $2,582,889 were transferred to the Lake Mountain Alpine Resort Management Board. As at that date, this amount was taken up as Contributed capital in accordance with the Ministerial Directive (this amount is included in the total Contributed capital at 31 October 2015 of $6,240,452). Pursuant to FRD 119A under the Financial Management Act 1994, during the reporting period, the Board received $150,000 contributed capital from the Department of Environment, Land, Water and Planning.

Note 13. Leases (a) Finance leases – Board as lessee Leasing arrangements Finance leases relate to plant and equipment with a lease term of 3 years.

2015

$ 2014

$

Finance lease liabilities payable Not longer than one year 19 953 19 953 Longer than one year and not longer than five years 18 290 38 243

Minimum future lease payments 38 243 58 195

Less future finance charges (2 331) (5 321)

Present value of minimum lease payments 35 912 52 875 Included in the financial statements as:

Current borrowings lease liabilities (note 9) 18 179 16 963

Non-‐current borrowings lease liabilities (note 9) 17 733 35 912

35 912 52 875

Notes: The finance lease relates to plant and equipment which the lease is secured against.

(b) Operating leases – Board as lessee Leasing arrangements Operating leases relate to photocopiers with a lease term of 5 years, and vehicles with a lease term expiry of 3 years. The Board does not have an option to purchase the leased assets at the expiry of the lease period. These figures include GST.

2015

$ 2014

$

Non-‐cancellable operating lease payables

Not longer than one year 124 611 67 710 Longer than one year and not longer than five years 133 510 16 500

258 121 84 210


FIN

ANCI

AL S

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THE

YEAR

EN

DIN

G 31

OCT

OBE

R 20

15



36

Note 14. Commitments for expenditure The following commitments have not been recognised as liabilities in the financial statements:

2015

$ 2014

$

Other expenditure commitments

Operation and maintenance commitments (i) & (ii)

Payable:

Not longer than one year 309 435 375 320

Longer than one year and not longer than five years -‐ 115 010

Total other expenditure commitments (inclusive of GST) 309 435 490 330

Less GST recoverable from the Australian Tax Office 28 130 44 575

Total other expenditure commitments (exclusive of GST) 281 305 445 755 (i) A supply and install agreement with Alpine XSP Pty Ltd was entered into for the service and maintenance of a

switchboard and generators. This commitment involves the expenditure of $700,000 over five years starting in the 2010-‐11 financial year.

(ii) The Board has a management agreement with Belgravia Health & Leisure Group Pty Ltd which expires on 30 April 2016. As a result the Board is committed to paying Belgravia an amount of $194,425 plus incentives for the period from 1 November 2015 to 30 April 2016.

Note 15. Contingent assets and contingent liabilities Under the Resort Management Agreement entered into with Belgravia Health & Leisure Group Pty Ltd, Belgravia is entitled to an incentive payment provided Belgravia meeting the agreed performance criteria. At the reporting date, the Board are not aware of any other contingent assets or contingent liabilities (2014: Nil).

Note 16. Financial instruments

The Board’s principal financial instruments comprise: • Cash assets; • Receivables (excluding statutory receivables); • Payables (excluding statutory payables); and • Borrowings.

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement, and the basis on which income and expenses are recognised, with respect to each class of financial asset and financial liability above are disclosed in Note 1 to the financial statements.

The main purpose in holding financial instruments is to prudently manage the Board's financial operations.

The carrying amounts of Board's contractual financial assets and financial liabilities by category are in the table below.



75


37

Note Category 2015 $

2014 $

Contractual financial assets Cash and deposits 17 Loans and receivables at amortised cost 1 921 205 1 367 215

Receivables (i): 5

Debtors Loans and receivables at amortised cost 92 289 47 288

Sundry debtors Loans and receivables at amortised cost 15 171 8 615

Total contractual financial assets 2 028 665 1 423 118

Contractual financial liabilities

Payables (i): 8

Creditors Financial liabilities at amortised cost -‐ 64 085

Other payables Financial liabilities at amortised cost 101 881 142 415

Borrowings: 9

Finance lease liabilities Financial liabilities at amortised cost 35 912 52 875 Total contractual financial liabilities 137 793 259 375

Note:

(i) The total amounts disclosed here exclude statutory amounts (e.g. amounts owing from Victorian Government and GST input tax credit recoverable, and taxes payable).

Net holding gain/(loss) on financial instruments by category

2015 $

2014 $

Contractual financial assets Financial assets – cash and cash equivalents

Interest on cash and deposits 32 413 10 078

Total contractual financial assets 32 413 10 078

Contractual financial liabilities

Financial liabilities at amortised cost:

Interest on finance leases 2 990 304

Total contractual financial liabilities 2 990 304

(a) Credit risk exposure Credit risk arises from the financial assets of the Board, which comprise trade and other receivables. The Board’s exposure to credit risk arises from the potential default of counter party on their contractual obligations resulting in financial loss to the Board. Credit risk is measured at fair value and is monitored on a regular basis.

As at the reporting date, there is no event to indicate that any of the financial assets were impaired.

There are no financial assets that have had their terms renegotiated so as to prevent them from being past due or impaired, and they are stated at the carrying amounts as indicated. The following table discloses the ageing only of contractual financial assets that are past due but not impaired:


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38

Carrying amount

Not past due and not impaired

Past due but not impaired

Less than 1 month 1-‐3 months 3 months -‐

1 year 1-‐ 5 years

2015 $ $ $ $ $ $

Receivables:

Debtors 92 289 88 121 -‐ 4 168 -‐

Sundry debtors 15 171 15 171 Total 107 460 15 171 88 121 -‐ 4 168 -‐

2014

Receivables:

Debtors 47 288 -‐ 28 338 18 634 316 -‐

Sundry debtors 8 615 8 615 -‐ -‐ -‐ -‐

Total 55 903 8 615 28 338 18 634 316 -‐

(b) Liquidity risk Liquidity risk arises when the Board is unable to meet its financial obligations as they fall due. The Board operates under the Government fair policy of settling financial obligations within 30 days and in the event of a dispute, make payments within 30 days from the date of resolution.

The Board’s maximum exposure to liquidity risk is the carrying amounts of financial liabilities as disclosed in the face of the balance sheet. The Board manages its liquidity risk by:

• close monitoring of its borrowings by senior management, including monthly reviews on current and future borrowing levels and requirements;

• maintaining an adequate level of uncommitted funds that can be drawn at short notice to meet its short term obligations;

• careful maturity planning of its financial obligations based on forecasts of future cash flows; and • a high credit rating for the State of Victoria (Moody’s Investor Services & Standard & Poor’s triple-‐A),

which assists in accessing debt market at a lower interest rate.

As indicated in Note 21, the Board is dependent on the Victorian State Government to ensure it can meet its obligations as and when they fall due. In this respect, the Board works closely with the Department of Environment, Land, Water and Planning to ensure support payments are received in a timely manner for it to meet its financial obligations.



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The following table discloses the contractual maturity analysis for the Board’s contractual financial liabilities.

Carrying amount

Nominal amount Maturity dates

Less than 1

month 1-‐3 months 3 months -‐ 1 year 1-‐ 5 years

2015 $ $ $ $ $ $

Payables:

Creditors -‐

Other payables 101 881 101 881 101 881

Borrowings:

Finance lease liabilities 35 912 35 912 1 468 2 962 13 748 17 732

Total 137 793 137 793 103 349 2 962 13 748 17 732

2014

Payables:

Creditors 64 085 64 085 25 511 38 574 -‐ -‐

Other payables 142 415 142 415 133 415 9 000 -‐ -‐

Borrowings:

Finance lease liabilities 52 875 52 875 1 367 4 152 11 444 35 912 Total 259 375 259 375 160 293 51 726 11 444 35 912

(c) Market risk The Board’s exposures to market risk are primarily through interest rate risk with almost no exposure to foreign currency and other price risks. Objectives, policies and processes used to manage each of these risks are disclosed in the paragraphs below: Interest rate risk Exposure to interest rate risk is insignificant and might arise primarily through the Board’s cash and deposits and finance lease liabilities. Minimisation of risk is achieved by mainly undertaking fixed rate or non-‐interest bearing financial instruments. Financial liabilities comprise of finance leases at fixed interest rates.

The Board’s exposure to interest rate risk and the effective weighted average interest rate for each class of financial assets and liabilities is set out below:


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Interest rate exposure of financial instruments

Weighted average effective

interest rate

Carrying amount

Interest rate exposure

Fixed interest

Variable interest rate

Non-‐interest bearing

2015

$ $ $ $

Contractual financial assets

Financial assets

Cash and deposits 3.35% 1 921 205 1 815 536 -‐ 105 669

Receivables 15 171 -‐ -‐ 15 171

Total financial assets 1 936 376 1 815 536 -‐ 120 840

Financial liabilities

Payables 101 881 -‐ -‐ 101 881

Borrowings

Finance lease liabilities 6.15% 35 912 35 912 -‐ -‐

Total financial liabilities 137 793 35 912 -‐ 101 881

2014

Contractual financial assets

Financial assets

Cash and deposits 2.50% 1 367 215 -‐ 1 021 800 345 415

Receivables 55 903 55 903

Total financial assets 1 423 118 -‐ 1 021 800 401 308

Financial liabilities

Payables 206 500 -‐ -‐ 206 500

Borrowings

Finance lease liabilities 6.15% 52 875 52 875 -‐ -‐

Total financial liabilities 259 375 52 875 -‐ 206 500

Sensitivity disclosure analysis and assumptions

The Board’s sensitivity to market risk is determined based on the observed range of actual historical data for the preceding five year period, with all variables other than the primary risk variable held constant. The Board cannot be expected to predict movements in market rates and prices. Sensitivity analyses shown are for illustrative purposes only. A movement of 100 basis points up and down (2014: 100 basis points up and down) in market interest rates is ‘reasonably possible’ over the next 12 months. The following table shows the impact on the Board’s net result and equity for each category of financial instrument held by the Board at the end of the reporting period as presented to key management personnel, if the above movement were to occur.



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Interest Rate Risk

-‐100 basis points +100 basis points

Carrying Amount Net Result Equity Net Result Equity

2015 $ $ $ $ $

Financial Assets

Cash 1 815 536 (18 155) (18 155) 18 155 18 155

Financial Liabilities

Interest bearing liabilities (35 912) -‐ -‐ -‐ -‐

Total 1 779 624 (18 155) (18 155) 18 155 18 155

2014

Financial Assets

Cash 1 021 800 (10 218) (10 218) 10 218 10 218

Financial Liabilities

Interest bearing liabilities (52 875) -‐ -‐ -‐ -‐

Total 968 925 (10 218) (10 218) 10 218 10 218

(d) Fair value The carrying amounts of financial assets and financial liabilities recognised at the balance date, consisting of cash, receivables, payables and borrowings, represent fair value because of the short-‐term nature of the financial instruments and the expectation that they will be paid in full.

Note 17. Cash flow information (a) Reconciliation of cash and cash equivalents Cash at the end of the year, as shown in the Cash Flow Statement, is reconciled to the related items in:

2015 $

2014 $

Operational funds 1 921 205 1 367 215

Total 1 921 205 1 367 215


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(b) Reconciliation of net result for the period

2015 $

2014 $

Reconciliation of results to net cash flows from/(used in) operating activities

Net Result (333 926) (210 098)

Non-‐cash movements

Depreciation 1 084 880 1 093 697 Loss/(gain) on disposal of assets 36 916 7 888 Loss/(gain) on impairment of physical assets 83 657 -‐ Other loss/(gain) from other economic activities 18 -‐

Movements in assets and liabilities

Decrease/(Increase) in receivables 17 247 (75 051)

Decrease/(Increase) in inventories 13 174 1 644

Decrease/(Increase) in prepayments (493) (6 403)

(Decrease)/Increase in payables (136 469) 50 203

(Decrease)/Increase in provisions 34 471 (2 559)

Net cash flows from/(used in) operating activities 799 475 859 321

Note 18. Reserves 2015

$ 2014

$

Physical asset revaluation surplus

Balance at the beginning of the financial year 10 266 415 10 226 415

Balance at the end of the financial year 10 266 415 10 226 415

Notes: The physical asset revaluation surplus is used to record increments and decrements on the revaluation of infrastructure, land and buildings, as described in accounting policy note 1(i).



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Note 19. Responsible persons

(a) Responsible persons

The names of the persons who were responsible persons at any time during the financial year are:

Responsible Minister:

The Hon. Ryan Smith, MP, Minister for Environment and Climate Change (from 1 November 2014 to 3 December 2014)

The Hon. Lisa Neville MP, Minister for Environment & Climate Change and Water (from 4 December 2014 to 31 October 2015)

Board members:

Ms D Culhane (1 November 2014 to 31 October 2015)

Mr A Nippard (1 November 2014 to 31 October 2015)

Mr K Ritchie (1 November 2014 to 31 October 2015)

Mr R Thomason (1 November 2014 to 31 October 2015)

Mr A Thompson (1 November 2014 to 31 October 2015)

Ms H Tudor-‐Harrop (1 November 2014 to 31 October 2015)

Executive officer:

Mr P Nunn (Executive officer 1 November 2014 to 30 July 2015)

Mr P Nunn (Chief executive officer 31 July 2015 to 31 October 2015)

(b) Remuneration

Remuneration received or receivable by the Executive Officer in connection with the management of the Resort during the reporting period was in the range: $50,000 -‐ $59,999 (2014: $10,000-‐$19,999).

The number of responsible persons whose remuneration from the Board was within the specified bands is as follows:

Income Band Total

remuneration Base

remuneration 2015 2014 2015 2014 No. No. No. No.

$0 – $9 999 3 5 4 5

$10 000 -‐ $19 999 3 2 2 2 $60 000 -‐ $69 999 -‐ 1 -‐ 1

Total numbers 6 8 6 8

Total amount $65 454 $111 818 $59 842 $98 777

The relevant amounts relating to the Minister are reported separately in the financial statements of the Department of Premier and Cabinet.


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(c) Other transactions The number of contractors charged with significant management responsibilities is disclosed within the $10,000 expense band. These contractors are responsible for planning, directing, controlling, and/or reporting upon, whether directly or indirectly, a significant proportion of the entity’s activities.

Expense Band Total expenses (exclusive of GST)

2015 No.

2014 No.

$170 000 – $179 999 1 -‐

$200 000 -‐ $209 999 (a) -‐ 1

$1 450 000 -‐ $1 459 999 (b) -‐ 1

$1 820 000 -‐ $1 829 999 (b) 1 -‐

Total Numbers 2 2

Total Amount $2 002 746 $1 662 461

Related party transactions Prior to the appointment of Philip Nunn to the position of Chief Executive Officer on the 31st of July 2015, Luminous Biz Development Pty Ltd was paid by the Board $176,307 (2014: $147,523) to provide administrative and other support services. Mr Nunn is a director of that company. The Board noted the potential conflict of interest, and managed this issue carefully. Belgravia Health & Leisure Group Pty Ltd have been contracted to manage the operation of the Resort and thus have significant management responsibilities pursuant to the agreement that is in place. During the year the Board paid $1,826,439 (2014: $1,465,514) for such services. Mr A Thompson is a board member of The Alpine Resorts Coordinating Council, a statutory body established under the Victorian Alpine Resorts (Management) Act 1997 to which the Board makes financial contributions for services provided by the Council. Total contributions paid during the reporting period (exclusive of GST) was $40,839 (2014: $30,401).

(d) Executive remuneration

The number of executives, other than ministers and accountable officers, and their total remuneration during the reporting period are shown in the first two columns in the table below in their relevant income bands. The base remuneration of executives is shown in the third and fourth columns. Base remuneration is exclusive of bonus payments, long service leave payments, redundancy payments and retirement benefits.

The number of executive officers whose remuneration falls within the specified bands below is as follows:

Income Band Total remuneration Base remuneration

2015 2014 2015 2014 No. No. No. No.

$40 000 -‐ $49 999 -‐ -‐ -‐ -‐ $50 000 -‐ $59 999 -‐ -‐ -‐ -‐ $90 000 – $99 999 -‐ -‐ -‐ 1 $100 000 -‐ $109 999 1 1 1 -‐

$110 000 -‐ $119 999 -‐ -‐ -‐ -‐

Total annualised employee equivalent (1) 1 1 1 1



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Total numbers 1 1 1 1

Total amount $104 830 $100 589 $104 830 $94 200

Notes: (1) Annualised employee equivalent is based on paid working hours of 38 ordinary hours per week over 52 weeks for

a reporting period.

Note 20. Remuneration of auditors

2015 $

2014 $

Internal Audit fees paid to Crowe Horwath 6 602 38 030

External Audit fees paid to VAGO 69 202 25 700

Total 75 804 63 730

External Audit Fees paid or payable to the Victorian Auditor General's Office (VAGO) are for the audit of the Board's financial statements.

Note 21. Economic dependency

The Board is dependent on the continued financial support of the Victorian State Government and in particular, the Department of Environment, Land, Water and Planning. The Department has provided confirmation that it will continue to provide the Board adequate cash flow support to meet its current and future obligations to fund essential operational expenditures as and when they fall due for the period up to December 2016. Accordingly these financial statements have been prepared on a going concern basis.

Note 22. Events occurring after reporting date

On 9 December 2015, the Minister for Environment, Climate Change & Water issued a Media Release, in which she announced that the “boards responsible for Lake Mountain and Mt Baw Baw will be merged” to form the Small Alpine Resorts Management Board, subject to legislation being passed by parliament. It is expected that this legislation will be introduced to parliament in 2016. The creation of this new entity would see the winding up of the existing Lake Mountain Alpine Resort Management Board, and its assets transferred to the new Board. In consideration of above, management does not believe there are any events that would necessitate a change, or adjustment, to the financial statements at 31 October 2015.

Note 23. Ex-‐gratia expenses There was no ex-‐gratia payments made during the 2014/15 financial year (2013/14: nil).


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COMPLIANCE INDEX – REPORT OF OPERATIONSThe Annual Report of Lake Mountain Alpine Resort Management Board is prepared in accordance with all relevant Victorian legislation. The index has been prepared to facilitate identifi cation of compliance with statutory disclosure requirements.

Legislation Requirement Page no.Accountable Offi cer’s declarationSD 4.2(j) Sign off requirements 36Charter and purposeFRD 22F Objectives, functions, powers and duties 21FRD 22F Manner of establishment and responsible Minister 21FRD 22F Nature and range of services provided 22Performance reporting: Non-fi nancialFRD 22F Operational and budgetary objectives 13FRD 22F, FRD 27C & MRO Performance against objectives 23FRD 22F Initiatives and key achievements 25Financial information: FinancialFRD 22F Summary of the fi nancial results 14FRD 22F Major changes or factors affecting performance 13FRD 22F Subsequent events 13FRD 22F Signifi cant changes in fi nancial position during the year 13MRO Capital projects 13Governance and organisational structure FRD 22F & SD2.2(f) Organisational structure and corporate governance arrangements 26FRD 22F & SD 2.2(f)&(G) Audit and Finance committee membership and roles 17FRD 22F Workplace health and safety policy 30Workforce dataFRD 22F Employment and conduct principles 30FRD 22F & FRD29 Comparative workforce data 28FRD21B Executive Offi cer disclosures 28Other informationFRD 10 Disclosure index 29FRD 12A Disclosure of major contracts 29FRD 22F Details of consultancies in excess of $10 000 29FRD 22F Details of consultancies under $10 000 30FRD 22F Disclosure of government advertising expenditure 30FRD 22F Application and operation of Freedom of Information Act 1982 33FRD 22F Compliance with Building Act 1993 33FRD 22F Statement on National Competition Policy 33FRD 22F Application and operation of Protected Disclosures Act 2012 34FRD 22F Summary of environmental performance 34FRD 22F Statement of availability of other information 34FRD 25 Victorian Industry Participation Policy disclosures 32SD 4.5.5 Risk management compliance attestation 35MRO Compliance with DataVic access policy 34PC 2012/02 Gifts, benefi ts and hospitality attestation 20SD 4.2(g) General information requirements 35LegislationAlpine Resorts (Management) Act 1997Financial Management Act 1994Public Administration Act 2004Print and designFRD 30B Standard requirements for the design and print of annual reportsAcronyms FRD - Financial Reporting Direction

SD – Standing DirectionMRO – Model Report of OperationsPC – Premier’s Circular

annual report 2014˜2015 - southernalpine.vic.gov.au · annual report 2014˜2015 firstly, i would...

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