Harrington Bowling Club CW 20180000002TCWIF...harrington bowling club limited abn: 56 001 040 311...

Harrington Bowling Club LimitedABN: 56 001 040 311

Financial StatementsFor the Year Ended 31 May 2018


ContentsFor the Year Ended 31 May 2018

Page

CONTENTS

DIRECTORS' REPORT 1AUDITOR'S INDEPENDENCE DECLARATION 6STATEMENT OF COMPREHENSIVE INCOME 7STATEMENT OF FINANCIAL POSITION 8STATEMENT OF CHANGES IN EQUITY 9STATEMENT OF CASH FLOWS 10NOTES TO THE FINANCIAL STATEMENTS 11DIRECTORS' DECLARATION 25INDEPENDENT AUDITOR'S REPORT 26

Harrington Bowling Club Limited ABN: 56 001 040 311

DIRECTORS' REPORT31 May 2018

Your directors present their report on the Company for the financial year ended 31 May 2018.

Directors

The names of the directors in office at any time during, or since the end of, the year are:

Kerry McDONALDRoger McELLIGOTTKelvin SWEETMANMargaret HAWKINSWarwick MUNROAllan ROSSGary JOHNSON (Appointed 19/08/2017)Garry DURRANT (Resigned 19/08/2017)

Directors have been in office since the start of the financial year to the date of this report unless otherwisestated.

Short-Term Objectives

The short-term objectives of the Company are to:

• Promote the Club principally for lawn bowls as well as other sporting, social and communityactivities.

• Provide entertainment to suit customers' needs.

• Provide quality food and beverage services with special benefits to customers.

• Raise funds for community based appeals.

• Ensure regulatory requirements are met.

Long-Term Objectives

The long-term objectives of the Company are to:

• Increase overall membership and encourage participation in sporting and other activities.

• Be a positive influence on the community through considered donations and providing a meetingplace for community entities.

• Provide and deliver quality food and beverage products and other services to customers.

• Upgrade Club and Caravan Park facilities.

1



Strategies

To achieve the objectives of the Company the following strategies have been adopted:

• Monitor the external and internal environment and make changes to the Club's Constitution, ifrequired.

• Provide cash donations (on request) as well as in-kind support to community organisations.

• Allow the use of the auditorium to members and community groups for special functions.

• Organise sporting events as well as raffles and donations to raise funds for charitable appeals.

• Maximise the benefits offered to community groups by appropriate management of the Club'sGrants Program.

• Promote men's and women's bowls, fishing, snooker and darts Clubs, entertainment activities andmembership benefits through in-house advertising as well as advertising in the local communitynewspaper, district press and TV campaigns.

• Reward customers for loyalty by conducting promotional events related to the Club's incomestreams.

• Offer services at a more competitive price than our local competitors.

• Deliver products and services in a professional and friendly manner that is equal to industrystandards and better than our local competitors by monitoring staff performance and encouragingconstant improvement in customer service.

• Provide regular music and dancing entertainment.

• Encourage discounted meals for members.

• Encourage promotional meals to all customers on targeted nights to increase turnover in quietperiods.

• Monitor health and safety requirements, industrial awards and other requirements for complianceand upgrade as necessary.

• Explore options for improvements to bowling green and act on improvement provided thecircumstances are favourable.

• Explore electronic options for improving services to customers.

• Upgrade equipment and infrastructure at the Club and the Caravan Park as required.

2



Principal Activities

The principal activity of the Company during the financial year was the conduct of a Registered Club.

No significant change in the nature of this principal activity occurred during the financial year.

Means by which Principal Activities Assisted in Achieving the Company's Objectives

The Club’s objectives were achieved through profits and cash flow as well as support provided byvolunteer activities.

Key Performance Measures

The Club measures performance against actual monthly results matched to forecasts derived fromprevious years' activities and anticipated growth in the major income streams of bar, bistro, gaming, TAB,KENO, fees from bowls events and caravan park receipts. The Club monitors trading results and anyimpact that may occur due to price increases and possible changes in regulations.

Members' Guarantee

The Company is limited by guarantee. If the Company is wound up, the Constitution states that eachmember is required to contribute a maximum of $ 2 each towards any outstanding obligations of theCompany. At 31 May 2018 the number of members was 2,940 (2017: 2,488).

Auditor's Independence Declaration

A copy of the auditor's independence declaration as required under section 307C of the Corporations Act2001 has been received and is included in this financial report.

Core and Non-Core Property

Core property is defined as any real property owned by the Club that comprises the defined premises ofthe Club or any facility provided by the Club for the use of its members and visitors. Core property of theClub consists of land occupied by the Clubhouse, Bowling Greens at 50 Beach Street, Harrington, NewSouth Wales.

Non core property of the Club means any real property owned by the Club that is not core property. Noncore property consists of land located at 69 Beach Street and a caravan park located at 71-83 BeachStreet, Harrington New South Wales.

3



Meetings of Directors

During the financial year 12 monthly and 1 special meetings of directors were held. Attendances by eachdirector during the year were as follows:

Directors' Meetings Special MeetingsEligible to

attendNumberattended

Eligible toattend

Numberattended

Kerry McDONALD 12 12 1 1Roger McELLIGOTT 12 11 1 1Kelvin SWEETMAN 12 12 1 -Margaret HAWKINS 12 12 1 1Warwick MUNRO 12 12 1 1Allan ROSS 12 12 1 -Gary JOHNSON 10 9 - -Garry DURRANT 2 - 1 -

Information on Current Directors

Kerry McDONALDExperience Chairman 5 years

Past Deputy Chairman 1 yearPast Ordinary Director 2 years

Special Responsibilities Chairman

Roger McELLIGOTTExperience Treasurer 6 yearsSpecial Responsibilities Treasurer

Kelvin SWEETMANExperience Past Ordinary Director 4 years

Deputy Chairman 2 yearsSpecial Responsibilities Deputy Chairman

4


STATEMENT OF COMPREHENSIVE INCOMEFor the Year Ended 31 May 2018

Note2018

$2017

$Revenue 3(a) 4,781,671 4,491,310Other income 3(b) 41,280 24,397

4,822,951 4,515,707

Changes in inventories 4 13,589 (12,637)Inventories purchased 4 (1,067,253) (945,978)Bowling, member and social expenses (130,689) (116,692)Contract management fees- caravan park (226,177) (182,035)Electricity and gas (167,014) (145,446)Employee benefits expense (1,375,374) (1,255,498)Depreciation and amortisation expense 4 (459,208) (443,957)Finance costs 4 (54,052) (66,543)Insurances (73,430) (74,371)Other poker machines, keno and tab expenses (212,966) (189,267)Rates and taxes (128,424) (148,352)Repairs, maintenance and cleaning expenses (280,156) (287,741)Other expenses from operating activities (324,334) (305,058)

(4,485,488) (4,173,575)

Profit before income tax 337,463 342,132Income tax expense - -

Profit for the year 337,463 342,132

Other comprehensive income for the year - -

Total comprehensive income for the year 337,463 342,132

Profit attributable to members of the entity 337,463 342,132

Total comprehensive income attributable to membersof the entity 337,463 342,132

The accompanying notes form part of these financial statements.7


STATEMENT OF FINANCIAL POSITIONAs at 31 May 2018

Note2018

$2017

$

ASSETSCurrent assetsCash and cash equivalents 5 1,500,658 1,238,560Trade and other receivables 6 9,520 17,370Inventories 7 63,790 50,362Other assets 8 10,875 20,870

Total current assets 1,584,843 1,327,162

Non-current assetsProperty, plant and equipment 9 5,047,475 5,180,635Intangible assets 10 - -

Total non-current assets 5,047,475 5,180,635

TOTAL ASSETS 6,632,318 6,507,797

LIABILITIESCurrent liabilitiesTrade and other payables 11 393,898 287,246Borrowings 12 170,728 152,233Short-term provisions 13 157,466 139,490Other current liabilities 14 10,268 14,155

Total current liabilities 732,360 593,124

Non-current liabilitiesBorrowings 12 608,417 981,296Long-term provisions 13 35,770 15,069

Total non-current liabilities 644,187 996,365

TOTAL LIABILITIES 1,376,547 1,589,489

NET ASSETS 5,255,771 4,918,308

EQUITYRetained earnings 5,255,771 4,918,308

TOTAL EQUITY 5,255,771 4,918,308



STATEMENT OF CHANGES IN EQUITYFor the Year Ended 31 May 2018

2018RetainedEarnings

$Total

$Balance at 1 June 2017 4,918,308 4,918,308Profit attributable to members of the entity 337,463 337,463Other comprehensive income - -


Balance at 31 May 2018 5,255,771 5,255,771

2017RetainedEarnings

$Total

$Balance at 1 June 2016 4,576,176 4,576,176Profit attributable to members of the entity 342,132 342,132Other comprehensive income - -


Balance at 31 May 2017 4,918,308 4,918,308



STATEMENT OF CASH FLOWSFor the Year Ended 31 May 2018

Note2018

$2017

$

Cash flows from operating activities:Receipts from customers 5,155,800 4,871,497Payments to suppliers and employees (4,196,577) (4,046,524)Interest received 6,595 5,588Finance costs (54,052) (66,543)Net cash provided by (used in) operating activities 911,766 764,018

Cash flows from investing activities:Proceeds from sale of plant and equipment 41,280 29,209Purchase of property, plant and equipment (336,564) (358,578)Net cash provided by (used in) investing activities (295,284) (329,369)

Cash flows from financing activities:Repayment of borrowings (354,384) (297,960)Net cash provided by (used in) financing activities (354,384) (297,960)

Net increase (decrease) in cash and cash equivalents 262,098 136,689Cash and cash equivalents at beginning of financial year 1,238,560 1,101,871Cash and cash equivalents at end of financial year 5 1,500,658 1,238,560



NOTES TO THE FINANCIAL STATEMENTSFor the Year Ended 31 May 2018

The financial report is for Harrington Bowling Club Limited as an individual entity, incorporated anddomiciled in Australia. Harrington Bowling Club Limited is a Company limited by guarantee.

Note 1 Summary of Significant Accounting Policies

Basis of Preparation The financial statements are general purpose financial statements that have been prepared in accordancewith Australian Accounting Standards - Reduced Disclosure Requirements of the Australian AccountingStandards Board (AASB) and the Corporations Act 2001.Australian Accounting Standards set out accounting policies that the AASB has concluded would resultin financial statements containing relevant and reliable information about transactions, events andconditions. Material accounting policies adopted in the preparation of these financial statements arepresented below and have been consistently applied, unless otherwise stated.The financial statements, except for the cash flow information, have been prepared on an accruals basisand are based on historical costs, modified, where applicable, by the measurement at fair value ofselected non-current assets, financial assets and financial liabilities.

The financial statements were approved and authorised for issue on 2 July 2018 by the Directors ofthe Company.

Accounting Policies

(a) Income Tax

The Company has been granted an exemption from income tax under Section 50-45 of the Income TaxAssessment Act 1997. The exempt status of the Company applies indefinitely or until such time as achange in circumstances warrants a review of the exempt status.

(b) Inventories

Inventories are measured at the lower of cost and net realisable value.

(c) Property, Plant and Equipment

Each class of property, plant and equipment is carried at cost or fair value as indicated less, whereapplicable, any accumulated depreciation and impairment losses.

Property Freehold land and buildings are measured on the cost basis.

Plant and equipment Plant and equipment are measured on the cost basis less accumulated depreciation and impairmentlosses.In the event the carrying amount of plant and equipment is greater than its estimated recoverableamount, the carrying amount is written down immediately to its estimated recoverable amount andimpairment losses are recognised in the statement of comprehensive income. An assessment ofrecoverable amount is made when impairment indicators are present (refer to Note 1(f) for details ofimpairment).

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(c) Property, Plant and Equipment (continued)

Plant and equipment (continued)

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, asappropriate, only when it is probable that future economic benefits associated with the item willflow to the Company and the cost of the item can be measured reliably. All other repairs andmaintenance are charged to the statement of comprehensive income during the financial period inwhich they are incurred.

Depreciation

The depreciable amount of all fixed assets including buildings and capitalised leased assets butexcluding freehold land, is depreciated on a straight-line basis over the asset's useful life to theCompany commencing from the time the asset is held ready for use.

The depreciation rates used for each class of depreciable assets are:

Class of Fixed Asset Depreciation Rate

Buildings and freehold improvements 2.5 to 20%Plant and equipment 5 to 50%

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at the end ofeach reporting period.

An asset's carrying amount is written down immediately to its recoverable amount if the asset'scarrying amount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount.These gains or losses are recognised in the statement of comprehensive income in the period inwhich they arise.

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(d) Financial Instruments

Initial Recognition and Measurement

Financial assets and financial liabilities are recognised when the Company becomes a partyto the contractual provisions to the instrument. For financial assets, this is equivalent to thedate that the Company commits itself to either purchase or sell the asset.Financial instruments are initially measured at fair value plus transaction costs except where theinstrument is classified at "fair value through profit or loss" in which case transaction costs arerecognised immediately as expenses in profit or loss.

Classification and Subsequent Measurement

Financial instruments are subsequently measured at either fair value, amortised cost using theeffective interest method or cost. Fair value represents the amount for which an asset could beexchanged or a liability settled, between knowledgeable, willing parties. Where available, quotedprices in an active market are used to determine fair value. In other circumstances, valuationtechniques are adopted.

Amortised cost is calculated as:

• the amount at which the financial asset or financial liability is measured at initialrecognition;

• less principal repayments;

• plus or minus the cumulative amortisation of the difference, if any, between the amountinitially recognised and the maturity amount calculated using the effective interest method;and

• less any reduction for impairment.

The effective interest method is used to allocate interest income or interest expense over therelevant period and is equivalent to the rate that exactly discounts estimated future cash paymentsor receipts (including fees, transaction costs and other premiums or discounts) through theexpected life (or when this cannot be reliably predicted, the contractual term) of the financialinstrument to the net carrying amount of the financial asset or financial liability. Revisions toexpected future net cash flows will necessitate an adjustment to the carrying value with aconsequential recognition of an income or expense in profit or loss.

(i) Financial assets at fair value through profit and loss

Financial assets are classified at "fair value through profit or loss" when they are held for tradingfor the purpose of short-term profit taking. Such assets are subsequently measured at fair valuewith changes in carrying value being included in profit or loss.

13



(d) Financial Instruments (continued)

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets with fixed or determinable paymentsthat are not quoted in an active market and are subsequently measured at amortised cost

Loans and receivables are classified as current assets, except for those which are not expected tomature within 12 months after the end of the reporting period, which will be classified as non-current assets.

(iii) Held-to-maturity investments

Held-to-maturity financial assets are non-derivative financial assets that have fixed maturities andfixed or determinable payments, and it is the Company's intention to hold these investments tomaturity. They are subsequently measured at amortised cost.

Held-to-maturity financial assets are classified as non-current assets, except for those which areexpected to mature within 12 months after the end of the reporting period.

(iv) Available-for-sale financial assets

Available-for-sale financial assets are non-derivative financial assets that are either not capable ofbeing classified into other categories of financial assets due to their nature, or they are designatedas such by management. They comprise investments in the equity of other entities where there isneither a fixed maturity nor fixed or determinable payments. They are subsequently measured atfair value.

Available-for-sale financial assets are classified as non-current assets, except for those which areexpected to mature within 12 months after the end of the reporting period.

(v) Financial liabilities

Non-derivative financial liabilities are subsequently measured at amortised cost.

Fair Value

Fair value is determined based on current bid prices for all quoted investments. Valuationtechniques are applied to determine the fair value for all unlisted securities, including recent arm'slength transactions and reference to similar instruments.

Impairment At the end of each reporting period, the Company assesses whether there is objective evidencethat a financial asset has been impaired. In the case of available-for-sale financial assets, asignificant or prolonged decline in the market value of the instrument is considered to determinewhether an impairment has arisen. Impairment losses are recognised immediately in the statementof comprehensive income.

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(e) Impairment of Assets At the end of each reporting period, the Company reviews the carrying values of its tangible andintangible assets to determine whether there is any indication that those assets have beenimpaired. If such an indication exists, the recoverable amount of the asset, being the higher of theasset's fair value less costs to sell and value in use, is compared to the asset's carrying value. Anyexcess of the asset's carrying value over its recoverable amount is expensed to the statement ofcomprehensive income.Where it is not possible to estimate the recoverable amount of an individual asset, the Companyestimates the recoverable amount of the cash-generating unit to which the asset belongs.Impairment testing is performed annually for goodwill and intangible assets with indefinite usefullives.

(f) Employee Benefits Provision is made for the Company's liability for employee benefits arising from services renderedby employees to the end of the reporting period. Employee benefits that are expected to be settledwithin one year have been measured at the amounts expected to be paid when the liability issettled, plus related on-costs. Employee benefits payable later than one year have been measuredat the present value of the estimated future cash outflows to be made for those benefits. Indetermining the liability, consideration is given to employee wage increases and the probabilitythat the employee may not satisfy vesting requirements.Contributions are made by the Company to an employee superannuation fund and are charged asexpenses when incurred.

(g) Provisions Provisions are recognised when the Company has a legal or constructive obligation, as a result ofpast events, for which it is probable that an outflow of economic benefits will result and thatoutflow can be reliably measured. Provisions recognised represent the best estimate of theamounts required to settle the obligation at the end of the reporting period.

(h) Cash and Cash Equivalents Cash and cash equivalents include cash on hand, deposits held at call with banks, other short-termhighly liquid investments with original maturities of three months or less, and bank overdrafts.Bank overdrafts are shown within short-term borrowings in current liabilities on the statement offinancial position.

(i) Trade and Other Payables Trade and other payables are carried at amortised cost and represent the liabilities for goods andservices received by the Company during the reporting period that remain unpaid at the end of thereporting period. The balance is recognised as a current liability with the amounts normally paidwithin 30 days of recognition of the liability.

(j) Revenue Revenue is measured at the fair value of the consideration received or receivable.Revenue from the sale of goods is recognised upon the delivery of goods to customers.Interest revenue is recognised on a proportional basis taking into account the interest ratesapplicable to the financial assets.Revenue from the rendering of a service is recognised upon the delivery of the service to thecustomers.

15



(j) Revenue (continued)All revenue is stated net of the amount of goods and services tax (GST).

(k) Borrowing Costs Borrowing costs directly attributable to the acquisition, construction or production of assets thatnecessarily take a substantial period of time to prepare for their intended use or sale, are added tothe cost of those assets, until such time as the assets are substantially ready for their intended useor sale.All other borrowing costs are recognised in profit or loss in the period in which they are incurred.

(l) Goods and Services Tax (GST) Revenues, expenses and assets are recognised net of the amount of GST, except where the amountof GST incurred is not recoverable from the Australian Taxation Office (ATO).Receivables and payables are stated inclusive of the amount of GST receivable or payable. Thenet amount of GST recoverable from, or payable to, the ATO is included with other receivables orpayables in the statement of financial position.Cash flows are presented in the statement of cash flows on a gross basis, except for the GSTcomponent of investing and financing activities, which are disclosed as operating cash flows.

(m) Affiliated Clubs Affiliated clubs are amalgamated with the Company unless they can demonstrate financial andlegal independence.

(n) Comparative Figures When required by Accounting Standards, comparative figures have been adjusted to conform tochanges in presentation for the current financial year.

(o) Critical Accounting Estimates and Judgements The Directors evaluate estimates and judgements incorporated into the financial statements basedon historical knowledge and best available current information. Estimates assume a reasonableexpectation of future events and are based on current trends and economic data, obtained bothexternally and within the Company.Key Estimates - ImpairmentThe Company assesses impairment at the end of each reporting period by evaluating conditionsspecific to the Company that may be indicative of impairment triggers. Recoverable amounts ofrelevant assets are reassessed using value-in-use calculations which incorporate various keyassumptions.

Key Judgements - Provision for Impairment of Property, Plant and EquipmentNo impairment has been recognised in respect of assets at the end of the reporting period.

16



Note 2 Correction of Prior Period Error

Adjustments were required to the balance of GST payable as at 31 May 2017 in order to correct priorperiod errors which resulted in restatements of opening balances for trade and other payables, retainedearnings and revenue. The errors resulted from the underpayment of GST on revenue in the priorreporting period:

Balance as per2017 Financial

Report$

31 May 20172018

Adjustments$

Restated 2017Comparative

Balances in 2018Financial Report

$

Statement of Financial PositionTrade and other payables 249,845 37,401 287,246Retained earnings 4,955,709 (37,401) 4,918,308

Statement of Financial PerformanceRevenue 4,528,711 (37,401) 4,491,310

17



Note 3 Revenue and Other Income

(a) Revenue 2018

$2017

$

Sale of goods Bar sales 1,456,106 1,396,360 Bistro sales 890,512 770,019

2,346,618 2,166,379 Other revenue: Caravan park revenue 677,963 665,064 Commissions received - Club Keno 78,848 81,950 Commissions received - other 16,068 17,684 Commissions received - TAB 15,697 8,498 Contributions - Sub clubs 10,193 (990) Government subsidies received 10,033 24,335 Green fees 57,877 58,202 Interest received - other persons 6,595 5,588 Membership subscriptions 42,496 38,917 Poker machine takings (net of payouts) 1,456,114 1,406,243 Supplier rebates 54,347 2,500 Sundry income 8,822 16,940

2,435,053 2,324,931

Total revenue 4,781,671 4,491,310

(b) Other income Net gain on disposal of property, plant and equipment 41,280 24,397

Total Revenue and Other Income 4,822,951 4,515,707

Note 4 Profit for the Year

(a) Expenses 2018

$2017

$

Cost of goods sold:Bar sales 655,547 629,679Bistro sales 398,117 328,936

1,053,664 958,615

Finance Costs: Interest expense 54,052 66,543

18



Note 4 Profit for the Year (continued)

(a) Expenses (continued)2018

$2017

$

Depreciation:Buildings and improvements 194,806 193,799Plant and equipment 264,402 250,158

459,208 443,957

Note 5 Cash and Cash Equivalents

Cash at bank and in hand - main club 1,405,540 1,153,467Cash at bank and in hand - sub clubs 95,118 85,093

1,500,658 1,238,560

Reconciliation of Cash Cash and cash equivalents at the end of the financial year

as shown in the statement of cash flows are reconciled toitems in the statement of financial position as follows:

Cash and cash equivalents 1,500,658 1,238,560

Note 6 Trade and Other Receivables CurrentTrade receivables 9,520 17,370

Note 7 Inventories CurrentFinished Goods - at CostBar stock 41,787 31,454Bistro stock 12,875 9,619Other consumables 9,128 9,289

63,790 50,362

Note 8 Other Assets CurrentPrepayments 5,875 15,870TAB guarantee 5,000 5,000

10,875 20,870

19



Note 9 Property Plant and Equipment 2018

$2017

$

Land and buildingsFreehold landLand at cost 1,377,870 1,377,870

Buildings and freehold improvementsBuildings at cost 5,590,855 5,510,554Accumulated depreciation (2,602,984) (2,408,178)

Total buildings 2,987,871 3,102,376

Total land and buildings 4,365,741 4,480,246

Plant and equipmentPlant and equipment at cost 2,845,183 2,811,815Accumulated depreciation (2,163,449) (2,111,426)

Total plant and equipment 681,734 700,389

Total property, plant and equipment 5,047,475 5,180,635

(a) Movements in Carrying Amounts

Movement in the carrying amounts for each class of property, plant and equipment between thebeginning and the end of the current financial year:

Land$

Buildings$

Plant andequipment

$Total

$

Balance at 1 June 2017 1,377,870 3,102,376 700,389 5,180,635Additions at cost - 80,301 246,781 327,082Disposals - - (1,034) (1,034)Depreciation expense - (194,806) (264,402) (459,208)

Balance at 31 May 2018 1,377,870 2,987,871 681,734 5,047,475

20



Note 10 Intangible assets

Note2018

$2017

$

GoodwillGoodwill at cost 774,092 774,092Accumulated impairment losses (774,092) (774,092)

Net carrying value - -

Note 11 Trade and Other Payables CurrentUnsecured liabilitiesTrade payables 142,201 128,137Accrued expenses 93,408 98,289Other payables 158,289 60,820

393,898 287,246

Note 12 Borrowings CurrentSecured liabilitiesBank loan 12(a)(b) 170,728 152,233

Total current borrowings 170,728 152,233

Non-CurrentSecured liabilitiesBank loan 12(a)(b) 608,417 981,296

Total non-current borrowings 608,417 981,296

Total borrowings 779,145 1,133,529

21



Note 12 Borrowings (continued)

(a) Total current and non-current secured liabilities 2018

$2017

$Bank loan 779,145 1,133,529

779,145 1,133,529

(b) The carrying amounts of non-current assets pledged as security are:

Freehold land and buildings 4,365,741 4,480,246Plant and equipment 681,734 700,389

5,047,475 5,180,635

(c) Collateral Provided

Bank Loan

The bank loan is secured by registered first mortgage over thefreehold land and buildings of the Company and a registeredmortgage debenture over the assets of the Company.

Note 13 Provisions Employeebenefits

$Total

$Opening balance at 1 June 2017 154,559 154,559Additional provisions 38,677 38,677

Balance at 31 May 2018 193,236 193,236

Analysis of Total Provisions 2018

$2017

$Current 157,466 139,490Non-current 35,770 15,069

193,236 154,559

22



Note 13 Provisions (continued)

Provision for Employee Benefits

Provision for employee benefits represents amounts accrued for wages, annual leave and longservice leave.

The current portion for the provision includes the total amount accrued for wages and annualleave entitlements and amounts accrued for long service leave entitlements that have vested dueto employees having completed the required period of service.

These amounts are classified as current liabilities since the Company does not have anunconditional right to defer settlement of these amounts in the event employees wish to use theirleave entitlement.

The non-current portion of the provision includes amounts accrued for long service leaveentitlements that have not yet vested in relation to those employees who have not yet completedthe required period of service.

Note 14 Other Liabilities

Current 2018

$2017

$Members' subscriptions in advance 10,268 14,155

Note 15 Capital and Leasing Commitments

(a) Capital Expenditure Commitments - Plant and equipment - 23,305

Payable:- not later than 12 months - 23,305

Note 16 Key Management Personnel Compensation

Key management personnel are those persons having authority and responsibility for planning,directing and controlling the activities of the the Company, directly or indirectly, including anyDirector (whether executive or otherwise) of that at entity. Control is the power to govern thefinancial and operating policies of an entity so to obtain benefits from its activities.

The aggregate compensation of key management personnel during the financial year comprisingamounts paid or payable or provided for was as follows:

2018$

2017$

Short-term employee benefits 100,731 93,693Post-employment benefits 9,569 8,901Other long-term benefits 3,411 4,985

113,711 107,579

23



Note 17 Other Related Party Transactions

Transactions between related parties are on normal commercial terms and conditions no morefavourable than those available to other persons unless otherwise stated.

Note 18 Members' Guarantee

The Company is limited by guarantee. If the Company is wound up, the Constitution states thateach member is required to contribute a maximum of $ 2 each towards any outstandingobligations of the Company. At 31 May 2018 the number of members was 2,940 (2017: 2,488).

Note 19 Financial Risk Management

The Company's financial instruments consist mainly of deposits with banks, cash on hand,accounts receivable and payable, bank loans and borrowings.

The carrying amounts for each category of financial instruments, measured in accordance withAASB 139 as detailed in the accounting policies to these financial statements, are as follows:

Note2018

$2017

$

Financial AssetsCash and cash equivalents 5 1,500,658 1,238,560Trade and other receivables 6 9,520 17,370

Total Financial Assets 1,510,178 1,255,930

Financial LiabilitiesFinancial liabilities at amortised cost

Trade and other payables 11 393,898 287,246Bank Loans 12 779,145 1,133,529

Total financial liabilities 1,173,043 1,420,775

Net Fair Values

The net fair values of financial assets and financial liabilities approximates their carryingvalues. The aggregate net fair values and carrying amounts of financial assets and financialliabilities are disclosed in the statement of financial position and in the notes to the financialstatements.

Note 20 Company Details

The registered office and principal place of business of the Company is:

50 Beach StreetHarrington NSW 2427

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