Annual Report 2002
Supporting Australian directors through our goals
Contents
Our 2001—2002 mission
President and Chief Executive
Australian Institute of Company Directors is Australia’s professional
Officer’s Report
2
National Office Reports
•
Education
4
•
State services and events
5
•
Policy and advocay
5
•
Operations
6
•
Finance
6
National Councillors
7
State Division Reports
organisation for directors providing education, information, and advocacy.
Our 2001—2002 goals
Australian Institute of Company Directors strives to:
1. meet the information and education needs of directors
2. promote excellence in director performance
3. provide a valued directors’ network
4. attract and retain members
5. be a successful advocate for directors’ issues, and
6. be a financially sound, efficient, and caring organisation.
•
New South Wales
8
•
Victoria
9
•
Queensland
9
•
Western Australia
•
South Australia and Northern Territory 10
Membership at yearend
•
Australian Capital Territory
11
Membership growth
•
Tasmania
11
AICD Five—year summary
10
Net surplus
2002
2001
2000
1999
1998
16,365
15,687
14,765
14,087
13,417
4.3%
6.2%
4.8%
5.0%
4.1%
$2,021,245
$591,253
$506,874
$646,488
$503,188
$15,945,798 $13,620,423 $12,487,946 $10,771,825
$9,429,421
Corporate Governance
12
Gross revenues
Division Councils
13
Net assets
$5,080,079
$3,058,834
$2,467,581
$1,960,707
$1,314,219
AICD Committees
14
Cash investments
$7,866,781
$5,476,106
$3,918,430
$3,310,398
$2,170,684
Financial Report
15
Net assets as a % of
gross revenues
31.9%
22.5%
19.8%
18.2%
13.9%
Cash investments as a % of
gross revenues
49.3%
40.2%
31.4%
30.7%
23.0%
Net surplus as a % of
gross revenues
12.7%
4.3%
4.1%
6.0%
5.3%
Our
goals
Kathryn Hudson, Senior Membership
Executive, NSW Division Office
Pictured on the front cover from the top left are staff members: Valerie Landgrebe (WA Division Office),
Rosanna McDonald (SA-NT Division Office), Tim Booth (National Office), Anita Sawa (National Office),
Ray Srodzinski (Tasmania Division Office), Karen Birkett (National Office).
AICD Annual Report
Twelve years on AICD celebrates
its most successful year to date
having delivered a record number
of Company Director Courses,
core education programs, director
briefings, and networking events.
The financial year closed
The beginnings of Australian
Institute of Company Directors
(AICD) can be traced back to
the United Kingdom’s Institute
of Directors (IoD), formed by
Royal Charter in 1906.
Branches of the IoD appeared
in the Australian States in the
1960s. These branches were
united in January 1971 under
The Institute of Directors in
Australia, an autonomous body
affiliated with the IoD in the
United Kingdom. The challenge
of servicing State branches
brought the arrival of a
competitor, The Company
Directors Association of
Australia, in 1982. The two
bodies merged on 1 January
1990 to form AICD.
with AICD in a strong financial
position which will enable an
expansion of education and other
services in the forthcoming year.
The following pages record
our success in the year and
outline
future
expand
our
professional
initiatives
role
as
organisation
2001
2002
to
the
for
directors in Australia.
Lindy Chapman, Membership Services Data Analyst and
Gliselle Quita, Assistant to National Finance Manager,
both of the National Office
1
1
Goals of AICD
To meet the
information and
education needs
of directors
Achievements towards this goal during
2001—2002 include:
•
a 27 per cent increase in
enrolments, with more than 27,000
participants in AICD courses and
training programs
•
a 25 per cent increase in
enrolments in the Company
Directors Course, with more than
1,500 participants
•
a record total of 18 residential
courses
•
requests for tailored workshops
doubled.
Ms Marie Lucas and Mr Garry Hansen
attending a Company Directors Course
residential held in Canberra (April 2002).
2
President and Chief Executive Officer’s Report
A
ustralian Institute of Company Directors
(AICD) has continued to develop its
services to provide education, information, and
professional support for Australian directors at
each stage of their career.
Best practice in directorship, both
nationally and internationally, is continually
being researched and communicated by AICD’s
policy and advocacy department. Trends are
monitored and relevant education and
information is provided to assist directors and
senior managers in making boards more
effective.
This report provides highlights of AICD’s
year, focusing on its goals and the success in
achieving those goals.
Meeting directors’ education needs
Demand for AICD courses continues to grow.
During the past financial year there has been a
27 per cent increase in enrolments, with more
than 27,000 participants in AICD courses and
training programs. More than 1,500 participants
undertook the flagship course, the Company
Directors Course, a 25 per cent increase on last
year’s numbers.
To meet demand, five additional residential
Company Directors Courses were scheduled
bringing a record total of 18 residential courses
for the year. Requests for tailored in-house
workshops has nearly doubled with 23 programs,
involving 460 participants, conducted by AICD
State offices during the year.
Asia-Pacific interest in AICD courses is
growing with members of the Philippines
Institute of Corporate Directors participating in
two Company Directors Course residential
courses. Discussions have been held with
counterparts in China, Indonesia, and Papua
New Guinea to explore ways in which AICD
education can be provided to assist their
corporate development.
During the year, the Company Directors
Course notes and other core education material
were completely reviewed to include current
legislative developments and new case studies;
communicate in plain English; and provide
standardised tutor presentations.
To ensure the continued quality of AICD
education services further investment was made
in staff, course materials, specialised education
programs, and the Company Directors
Conference.
Two new specialised programs, “Forensic
investigation for directors” and “Implementing
compliance”, were introduced. A further two
new programs, “Company audits: lifting the veil”
and “Handling difficult situations in the
boardroom”, have been developed and will be
offered to members in all States in the new
financial year.
The timely launch of three AICD texts, The
Twenty-First
Century
Board:
selection,
performance, and succession, Audit Committee
Best Practice Guide, and 50 Matters to be
considered before signing a company’s financial
statements, brought sales that exceeded
expectations as directors sought guidance in
these important areas.
“Catch the Future” proved to be the most
successful Company Directors Conference to
date. A program of international and national
speakers dealing with current issues attracted
500 members. Delegate feedback showed a 20
per cent increase in satisfaction with key
elements of the event on last year’s conference.
Promoting excellence in directorship
The delivery of new courses, the review of
existing course materials, and the launch of new
publications, are testimony to AICD’s
commitment to promote director excellence.
Coupled with this, there has been a five per cent
increase in the number of Company Directors
Course participants undertaking the noncompulsory course assessment. A total of 875
participants sat the examination and completed
the assignment task that led to the award of the
Company Directors Course Diploma.
Library services and facilities at AICD have
been upgraded to increase the availability of
information on director issues and best practice
internationally. The seventeenth edition of
Duties and Responsibilities of Directors and Officers
was released and all members received copies in
May 2002. This text is a comprehensive, plain
English guide to the law affecting Australian
directors and officers and the new edition details
the recent changes to the Corporations Act and
recent court decisions.
The Law Reporter pages, Australian
Securities and Investments Commission column,
and industry leader interviews featured in the
Company Director journal inform members of
director best practice. A Taylor Nelson Sofres
Survey 2002 showed that 95 per cent of AICD
members “highly regarded” the journal. Another
initiative in promoting excellence was AICD’s
three-year commitment to be the principal
sponsor of the Australasian Annual Reporting
Awards. The awards promote and acknowledge
excellence in reporting by companies,
government entities, and not-for-profit organisations.
Providing a network for directors
A record number of 40 networking events and
61 luncheons were hosted by AICD around
Australia during the year. These activities allow
members and business leaders to get together, to
receive compliance and governance updates,
and to share their experiences.
Database research conducted in June shows
AICD membership is made up of 51 per cent of
the directors sitting on the boards of the
Australian Stock Exchange’s top 200 companies
and that 119 of those members hold the position
of chairman of the board.
AICD Annual Report
Growing the membership
Membership grew by 4.3 per cent during the year
to a total membership of 16,365 at the end of the
financial year. Research was conducted to
determine the needs of members. This research
led to: the first strategy session conducted by the
National Education Committee in March 2002;
an enhanced membership database system; and
development of a new website to enable online
membership applications, event and course
bookings, and publication orders.
New methods of involving members
introduced during the year include the
webcasting of the Company Directors
Conference 2002 Federal Budget session and the
introduction of a broadcast email survey to
obtain members’ views on policy issues to assist
AICD to effectively respond to a number of
government inquiries.
The directors’ advocate
Through the work of AICD’s four policy
committees—law, taxation and economics,
accounting and financial advisory, and sustainability—40 submissions have been presented to
government and government authorities and
three policy positions have been developed on
behalf of members.
The policy efforts of AICD have concentrated on: the independence of auditors; the
liability of directors in the case of industrial
death; simplification of taxation laws; the review
of Australia’s international tax regime; the
review of the Australian Consumer and
Competition Commission’s powers; the
shortcomings of Australia’s superannuation
system; the protection of employee entitlements;
the Australian Stock Exchange’s corporate
governance guidelines; and the federal
government’s review of the continuous
disclosure regulations.
This work has brought three successful
outcomes for Australian directors during the
year. These matters are listed below.
•
•
•
In May, the Crimes (Workplace Death and
Serious Injuries) Bill 2001 was defeated in
the Upper House of the Victorian
parliament. The bill sought to make
directors and officers of companies
criminally liable for the negligent acts or
omissions of others. While AICD is
committed to workplace safety and stringent
safety laws, it cautioned the government on
law reform having a punitive, rather than
preventative, focus.
Also in May, the Board of Taxation made
the decision to end all work on the
Treasury’s proposed new model for
calculating taxable income, the tax value
method that AICD argued would not
simplify taxation laws.
The policy committees have worked hard in
highlighting insolvency and corporate
disclosure as issues to federal government.
During the year, AICD was pleased to learn
of the government’s announcement of two
further stages to the Corporate Law
Economic Reform Program, CLERP 8 on
insolvency and CLERP 9 on accounting and
auditing and corporate disclosure.
National Council of AICD endorsed three
policy positions on the subjects of sustainability,
intangible assets, and the requisitioning of
company meetings. This policy work and allied
media releases have in turn led to a number of
media interviews and increased public profile for
the organisation.
Financial, efficient, and caring
The statement of financial position
demonstrates AICD’s success in meeting
profitability targets for the past financial year.
An increased revenue of 17.1 per cent was
achieved bringing a net surplus of $2,021,245.
To ensure this continuing success, a new
compliance program was developed. Staff
training on risk management is to proceed early
in the new financial year.
Growth in demand for AICD services
during the past eighteen months has in turn
brought the need for increased resources. “The
Employee Support System” was introduced to
provide an AICD employee manual online and
personal advice with a consultant on-call. The
National and New South Wales division offices
moved to Australia Square Tower in Sydney, in
the city’s commercial hub. These new offices
offer staff and committee members more
meeting rooms and more modern facilities.
The efforts of a hardworking team of staff
have contributed substantially to AICD’s
success. We thank them for serving the
membership and for encouraging increased
professionalism in directorship, good corporate
governance practices, and support to Australian
business.
We particularly wish to thank the members
who so generously gave their time to serve on
National Council, Divisional Councils, the
National Education Committee, the Conference
Committee, the policy committees, and the task
forces established by AICD. Their contributions
have greatly assisted AICD in achieving success
and further developing services to support
Australian directors in the future.
Future strategy
The strong financial result has enabled the
National Council to provide additional financial
resources for expansion of our educational
activities in the new financial year. In addition
AICD research and information delivery
capacities will be upgraded to enhance our role
in developing corporate governance best
practice guidance.
Subsequent to the yearend the Australian
Stock Exchange announced the establishment
of a Corporate Governance Council and AICD
will play a leading role in the work of the
Council.
Major initiatives already underway include
the recruitment of three new education
managers, development of an advanced course
for graduates of the Company Directors Course,
the launch of the new website, and the review of
the future resource requirements of the policy
and advocacy department.
We look forward to reporting growth in new
services for members in the Company Director
journal and the website throughout the year.
Elizabeth Alexander AM FAICD
President
John Hall FAICD
Chief Executive Officer
1
Education
John Hall FAICD, Chief Executive Officer
and Elizabeth Alexander AM FAICD, President
3
2
Goals of AICD
Promote
excellence in
director
performance
Achievements towards this goal during
2001—2002 include:
•
•
the delivery of two new specialised
education programs, “Forensic
investigation for directors” and
“Implementing compliance”
the launch of four AICD corporate
governance texts: The Twenty-First
Century Board: selection,
performance, and succession,
Audit Committee Best Practice
Guide, 50 Matters to be considered
before signing a company’s
financial statements, and Duties
and Responsibilities of Directors
and Officers (17th edition).
Ms Kate Joseph and Mr Wayne Munro
attending the Company Directors Course
residential in Canberra (April 2002).
4
National Office Reports
T
he national office of AICD is structured to
support AICD State divisions, deliver core
education courses and events, develop policy on
director issues, publish the Company Director
journal and best practice texts for directors, and
represent the views of members nationally. The
national office shares its office with the New
South Wales division at Australia Square Tower
in Sydney.
In its supportive role, the office is divided
into five departments: education, State services
and events, policy and advocacy, operations, and
finance. The work of these departments in
meeting the strategy of AICD during the past
financial year is detailed below.
Unprecedented demand for education
The corporate climate and quality of AICD
education has given rise to unprecedented
demand for education and training courses. The
education department is responsible for
developing and maintaining the Company
Directors Course as a residential, tutorial, and
correspondence program; for developing core
education programs; and for providing an up-todate catalogue of business texts to members at
discounted prices. The strategy of the education
department is to develop new education courses
and to update and revise existing courses.
Demand for AICD education is welldocumented in the President and Chief
Executive Officer’s Report. Further details
follow:
New education courses developed
In line with AICD strategy, two new education
courses were developed—“Forensic investigation for directors—recognising the warning
signs”, and “Implementing compliance”. Other
courses about to be launched are “Company
audits: lifting the veil” and “Handling difficult
situations in the boardrooms”.
A consultant editor was hired to review all
Company Directors Course and core education
materials to ensure uniformity of style and use of
plain English. Course tutors and leading
directors reviewed all the course modules to
update the text with the latest developments.
Three AICD texts were launched during the
year—The Twenty-First Century Board: selection,
performance, and succession, Audit Committee
Best Practice Guide, and 50 Matters to be
considered before signing a company’s financial
statements. Sales of national and international
texts, available to members at a 15 per cent
discount, remained constant.
Education initiatives—past and future
A number of initiatives grew from the demand
and reputation of AICD courses and the first
strategy meeting held by the National Education
Committee in March, they include:
•
•
Eighteen Company Directors Course
residential programs were held, principally
in Canberra, involving a total of 426
participants.
• Forty-eight tutorial Company Directors
Courses were conducted by the State
divisions for 1,104 participants. Ninety-four
participants enrolled in the correspondence
program.
In summary, there was a 14 per cent increase
in the number of Company Directors Courses
delivered and a 25 per cent increase in the
number of course participants when compared
with figures of the previous financial year.
•
•
•
•
Eighty-three core education programs were
conducted during the year with the most
popular courses being “The new director
program”, “Board, director and CEO
assessment”, and “The role of the
chairman”. Core education courses involved
1,902 participants.
• Twenty-three core education programs were
tailored as in-house workshops and 460
participants took part.
In summary, the number of programs
conducted increased by 34 per cent on last year’s
figures and a 43 per cent increase was recorded
in the number of tailored workshops.
•
Two Company Directors Course residential
programs held for participants from the
Philippines Institute of Company Directors.
Continued support to the Thai Institute of
Directors with the delivery of the Company
Directors Course under licence.
The first rural residential Company
Directors Course held in Albury, with more
planned for other regional centres.
The Federal Department of Agriculture,
Forestry and Fisheries Australia choosing
the Company Directors Course as the
vehicle for training young rural leaders.
Fourteen young leaders from rural Australia
were granted Company Directors Course
scholarships.
More
recently,
the
Parliamentary Secretary for Agriculture,
Fisheries and Forestry, Senator Judith
Troeth, announced a similar program for
women working in Australian rural
industries.
The recruitment of three new education
managers in the new financial year and the
development of a database of 100 tutors.
Liz Jeffrey MAICD
National Manager, Education
[email protected]
direct line: + 61 2 8248 6620
AICD Annual Report
Encouraging corporate governance
discussion
AICD Executive team (as at 30 June 2002)
State services and events adding value
A restructure of the professional development
department brought rise to its renaming to State
services and events department at the beginning
of the financial year. Leading the agenda of the
state services and events department was the
task of conducting the Company Directors
Conference, researching means of attracting and
retaining members, and creating cost efficiencies
in producing marketing materials.
Five hundred delegates attended the
Company Directors Conference 2002 held from
the 15 to 17 May on the Gold Coast. This record
number of delegates, the quality of national and
international speakers, and the topics they dealt
with raised the revenue substantially on last
year’s figures.
A conference evaluation survey completed
by 167 delegates showed a 17 per cent increase
in the overall satisfaction in topics, from 52 per
cent in 2001 to 69 per cent in 2002, and a 10 per
cent increase in satisfaction in the quality of
speakers, from 52 per cent in 2001 to 62 per cent
in 2002.
All AICD members were offered a “free
seat” to the Budget Session of the conference
through the webcasting of the session on AICD’s
website for a month after the conference. The
webcast was viewed by 634 people and the
popularity of the concept has led to the
webcasting of the conference debate on
Corporate Social Responsibility early in the new
financial year.
Researching member services
Understanding the role played by the AICD is the
title of the membership survey commissioned
by AICD and presented by consultants,
Taylor Nelson Sofres, in May. A group of
about 750 members, lapsed members, and
non-members were questioned through an
interview, by telephone, or focus-group
discussion. The survey results will be a valuable
aid in identifying initiatives for attracting and
retaining members and as a guide to AICD’s
strategic direction.
Centralising core marketing activities
during the past eighteen months has led to
higher standards in AICD branding and print
material and substantial cost-savings for the
smaller State divisions. New initiatives include
the introduction of standard brochure templates
for education courses and the coordination of
print production. By adopting this process, a
50 per cent saving on printing brochures is
possible.
Sponsorship of best practice in reporting
New initiatives for the year include AICD’s
major sponsorship of the Australasian Reporting
Awards 2002 run by the not-for-profit organisation, the Australasian Reporting Awards Inc.
The awards foster excellence in corporate
disclosure by setting criteria on good reporting
practices and awarding companies, not-for profit
organisations, and government entities, for
excellence in their reporting. At an awards
dinner in May, 147 organisations were
recognised for their excellence in reporting.
Pauline Green FAICD
National Manager, State services and events
[email protected]
direct line + 61 2 8248 6670
An active policy and advocacy year
International and national sentiment to further
regulate corporations and their directors has
brought an active year for AICD policy
committees and AICD in the policy and
advocacy department.
Policy of AICD is determined by the
National Council with the assistance of AICD’s
four policy committees—law, accounting and
financial advisory, taxation and economics, and
sustainability. Forty submissions were lodged
with government and authorities during the
year. All submissions dealt with director-related
issues and are available on the AICD website.
Their subject matter was broad ranging, from the
independence of auditors to international tax
reform.
Representation on policy issues is a longterm endeavour often running over a number of
years. A number of issues were, however,
resolved during the year, including those issues
documented in the President and Chief
Executive Officer’s Report. During the year the
National Council announced policy positions
on a number of issues including, sustainability,
intangible assets, and the requisitioning of
company meetings.
The strategy of further communicating
policy work has led to a news page on AICD
website and Members’ Voice page in the
Company Director journal. In preparing
submissions, a new method of canvassing
member views has been introduced. It involves a
broadcast email requesting feedback on issues
raised by the submission.
More time has been dedicated to presenting
AICD policy positions to politicians, key
bureaucrats, and other stakeholder groups.
Representatives
from
AICD
attended
Parliamentary Joint and Senate Committee
Public Hearings to reinforce AICD’s positions.
Meetings on key issues were arranged with the
Hon. Senator Ian Campbell, Senator Stephen
Conroy, and the Hon. Senator Helen Coonan.
For closer communication with government,
Federal Treasury staff members are invited to
join the law committee and accounting and
financial advisory committee as ex-officio
members.
Industry Liaison Committee meetings are
hosted by AICD on a quarterly basis. These
meetings provide a forum for debate on a range
of issues affecting directors. The Australian
Shareholders Association, Investment Financial
Services Association, Australian Employee
Ownership Association, Australasian Investor
Relations Association, Securities Institute of
Australia, Company Secretaries Association of
Australia, and Australian Stock Exchange
attended.
An increase in demand for information on
corporate governance and director best practice
brought a 20 per cent increase in inquiries to the
AICD library during the year. The new AICD
website, to be launched in the new financial
year, will publish the library’s catalogue and its
“frequently asked questions” page will provide a
useful quick reference point. The website will
also allow access to corporate governance
databases worldwide through web hyperlinks.
Rob Elliott MAICD
National Manager, Policy and advocacy
[email protected]
direct line: + 61 2 8248 6630
2
Excellence
Linda Carruthers, Executive Assistant,
ACT Division Office
5
3
Goals of AICD
Provide a
valued directors’
network
Achievements towards this goal during
2001—2002 include:
•
a record number of 40 networking
events and 61 luncheons hosted
•
500 delegates attended “Catch the
Future”, Company Directors
Conference 2002
•
51 per cent of the directors of the
Australian Stock Exchange’s top
200 companies are AICD members,
and 119 of those members are
chairmen.
Investment in operations for growth
Considerable investment in new office space,
technology, and human resources took place
during the year in response to AICD’s growth.
The expiry of the York Street office lease
prompted the decision to move the offices to
level 25, Australia Square Tower in Sydney. A
redesign and refurbishment of the new open
plan office was undertaken and the move of
47 staff took place in January 2002.
Development and investment in new
technology was set out in a strategy document—
AICD IT Roadmap. This document maps
AICD’s development strategy for technology
infrastructure, internal technology applications,
and the website.
An organisation-wide audit was conducted
to establish the technology needs of all AICD
offices. Personal computers and printers were
upgraded and all offices were supplied with
laptop personal computers and data projectors
for course presentations, and digital cameras.
Uniform software applications are now in
use. Microsoft operating systems and Lotus
Notes application software have been upgraded.
The installation of ADSL broadband, Microsoft
2000 network software, and other new
technology has enabled faster email communication and improved data security.
A review of internal computer applications
initiated a data integrity program across all
systems and two new staff members were
employed to manage the database and provide
training.
New website for members
Members will soon receive the benefit of AICD’s
investment in its new website, due to be
launched in the new financial year. The new
website offers:
•
Secure online membership application and
payment; course and event booking and
payment; and ordering of publications.
• Member access to a comprehensive list of
“frequently asked questions”, library
services, policy submissions, and media
releases.
Investment in human resources resulted in a
new AICD online employee manual and the
availability of advice on call from an external
consultant.
Company Director reports profit despite
global downturn
Mr Nick Greiner AC and Mrs Kathryn
Greiner at the "Catch the Future"
Company Directors Conference 2002.
6
The past financial year was one of mixed fortune
for Company Director journal. Last year’s global
downturn in business confidence and activity
was reflected in the national advertising market.
Despite the downturn, Company Director was
able to be profitable for the year. A major factor
contributing to this result was the State features
run in the journal towards the end of the
financial year. While these features are a source
of revenue they also provide an ideal editorial
platform for individual States to showcase their
economy, industries, and strategies that will
contribute to future growth.
Most importantly, Company Director continues
to be a major editorial and information vehicle
for members. A survey conducted in May by
consultants, Taylor Nelson Sofres, showed 95
per cent of members “highly regarded” the
journal.
Ian Mackay FAICD
National Manager, Operations
[email protected]
direct line: + 61 2 8248 6640
A successful financial year
Through a combination of increased revenue of
17.1 per cent during the previous financial year,
efficiency in variable costs and savings in
overhead expenditure, AICD had a very
successful year financially. A net surplus of
$2,021,245 was achieved compared to $591,253
the previous year. A culture of fiscal responsibility and accountability and an efficient
budgetary control system greatly contributed to
this result.
Members’ funds at 30 June were $5,080,079
compared to $3,058,834 at the end of the
previous financial year. Funds in excess of
operating needs were invested in financial
instruments, for example, bank bills, commercial
paper, and corporate bonds. The primary
objective of AICD investment guidelines, as
approved by National Council, is to preserve
capital and to obtain the best yield from those
investments. Maintaining a diversified portfolio
is also an important criteria. The weighted
average rate of return on AICD investment
portfolio during the year exceeded the going rate
of return on 90-day bank bills at any one time.
As an independent organisation with no access
to external financial support, AICD has an
important need to maintain a good level of
reserves in order to protect itself from any
unexpected adverse event such as a prolonged
economic downturn.
Compliance and risk-management issues are
important elements of good management
practice. During the year a compliance program
was developed and staff training will begin early
in the new financial year.
Clark Chui MAICD
National Manager, Finance
[email protected]
direct line: + 61 2 8248 6660
3
Networks
Alison O’Meara, Administrative Officer,
WA Division Office
AICD Annual Report
National Councillors
Australian Institute of Company
Directors’ National President,
Elizabeth Alexander AM FAICD,
took office on 30 October 2000.
A listing of the names and board
positions of the National Council
as at 30 June 2002 follows.
Miss Elizabeth Alexander AM FAICD
National President
Director, Amcor Ltd; Director, Boral Ltd;
Director, CSL Ltd; Director, Winston
Churchill Memorial Trust; Member of the
Takeovers Panel and Financial Reporting
Council; Chairman of the Board of
Advice of the Salvation Army (Southern
Command).
Dr Ken Moss FAICD
National Vice-President
Chairman, Australian Maritime Safety
Authority; Chairman, Boral Ltd;
Chairman, Centennial Coal Company
Ltd; Director, Adsteam Marine Ltd;
Director, General Property Trust
Management Ltd; Director, National
Australia Bank Ltd; Board member,
Hunter Area Health Service.
Mr Don Mercer FAICD
National Vice-President
Chairman, Australia Pacific Airports
Corporation Ltd; Chairman, Orica Ltd;
Director, Australian Prudential
Regulation Authority; Director, CSIRO;
Chancellor, RMIT University; Chairman,
Orchestra Victoria.
Mr Graeme McGregor AO FAICD
Treasurer
Director, Community Foundation
Network; Director, Foster’s Group Ltd;
Director, Nufarm Ltd; Director, Santos
Ltd; Director, Were Securities Ltd;
Member, Financial Reporting Council.
Mr Charles Bagot MAICD
President, South Australia and Northern
Territory Division
Partner, Piper Alderman; Director,
Australian Submarine Corporation Pty
Ltd; Director, Duck Island Pty Ltd;
Director, Mordinyabe Pty Ltd; Director,
South Australian Art Gallery Foundation;
Director, St Marks College affiliated with
the University of Adelaide.
Mr M. James Green FAICD
President, New South Wales Division
Executive Director, Beerworth & Partners
Limited; Director, Hayward Industries
(Australia) Pty Ltd; Hayward Pool
Products (Australia) Pty Ltd.
Mr Andrew Guy FAICD
President, Victoria Division
Consultant, Allens Arthur Robinson;
Director, CGNU Australia Holdings Ltd;
Director, Datafast Telecommunications
Ltd; Director, Djerriwarrh Investments
Ltd; Director, Paperlinx Ltd.
Mr Gerald Loughran FAICD
President, Tasmania Division
Chairman, Crisp Bros/Haywards Pty Ltd;
Chairman, Tasmania Community Fund;
Deputy Chairman, Aurora Energy Pty
Ltd; Director, Webster Ltd.
Mr Peter Mansell FAICD
President, Western Australia Division
Partner, Freehills; Chairman, Hartleys
Limited; Director, AngloGold Group
Companies in Australia; Director,
Bunnings Property Management Limited;
Director, West Australian Newspapers
Holdings Ltd; Committee member, Curtin
University of Technology.
Mr John Massey FAICD
President, Queensland Division
Chairman, AV Syntec Group Ltd;
Chairman, Ventracor Ltd; Director,
Australian Dairy Corporation; Director,
Darling Downs Foods Ltd; Director,
Kerwee Pastoral Group Companies;
Director, Voxson Ltd.
Mr Alan Morrison FAICD
President, ACT Division
Chairman and Chief Executive,
CLANMOR Holdings Pty Ltd; Deputy
Chairman, Energy Council of Australia;
Executive Director, Sydney World Energy
Congress.
7
4
Goals of AICD
Attract and
retain
members
Achievements towards this goal during
2001—2002 include:
•
a record number of members of
16,365 as at 30 June 2002
•
major investment in the
membership database system
•
development of a new website
enabling online access to
membership applications, events
and course bookings, publication
orders.
State Division Reports
Members of AICD are served by their State
division office which reports to the national
office on the effective running of the division.
Each division has a council of 10 representatives
elected by members in the State. In addition to
being involved in division activities, the
division council elects a division representative
to the National Council, the governing body of
the organisation that sets the policy for AICD.
Reports on the performance of each division
during the past financial year follow.
•
•
New South Wales keeps abreast of best
practice
A busy calender of events designed for our
members contributed to another very successful
year for the New South Wales division. The
division is AICD’s largest, representing 34 per
cent of the membership nationally and the
number of new members increased during the
year by two per cent, bringing the total number
of members to 5,650.
Of the record number of 98 events for
members, there were:
• Twenty-two national core education
programs, and a record number of
13 Company Directors Courses. There has
been unprecedented demand for programs
on corporate governance-related topics.
Customised in-house workshops continue to
grow in popularity with programs commissioned by public listed companies, cooperatives, associations, private companies,
and government boards.
• Sixteen seminars on areas such as
commercial negotiation, powerful speech
and presentations, executive coaching,
mergers and acquisitions, and strategic
financial skills.
•
Twelve briefings focused on topical issues
such as technology, risk management, duallisted companies, lobbying government
effectively, the demise of Enron,
outsourcing, cybercrime, and diversity in
boardroom skills and thinking. Speakers at
these briefings included Wendy McCarthy
AO, Alan Cameron AM, Carolyn Hewson,
and the Hon. Craig Knowles.
Innovative luncheon and breakfast events
featured international speakers including
the US change management expert, Daryl
Connor; Joseph Plumeri, Chairman of the
Willis Group; Keith Whitson, Global Chief
Executive Officer, HSBC; international
diplomat Richard Butler AM; and international best-selling author, Chin-Ning Chu.
These events have been complemented by
luncheons involving national business
leaders such as Peter Smedley, Chief
Executive Officer of Mayne Group;
Linda Nicholls, Chairman of Australia
Post; and professional company directors,
Nick Greiner AC and Dick Warburton.
In all, 3,835 attendees have supported
13 luncheons during the year.
Specific networking events such as the
evenings for new members, cocktail
evenings, graduation evenings, and the
Christmas Long Lunch.
To continue this level of service, we have
recruited two new team members during the
year. I thank our dedicated staff for their
enthusiasm, energy and commitment and
acknowledge the continued support of our
members, sponsors, and the wider New South
Wales business community.
James Green FAICD
President
Julie Curran MAICD
New South Wales Division Manager
[email protected]
direct line: + 61 2 8248 6680
Mr Ashley Harris, Ms Pauline Green and
Mr Tony Newton at the "Catch the Future"
Company Directors Conference 2002.
8
The AICD management team as at 30 June 2002 from left to right (back row) Ian Mackay, Pauline Green,
Carey Cox, Rob Elliott, Julie Curran, Andrew Madry,Graeme Burgess, Sue Jackson (front row) Angela Downs,
Len Robertshaw, Liz Jeffrey, John Hall, Louise Barnett, Clark Chui.
AICD Annual Report
Victorian members seize education
opportunities
Director education reaches across
Queensland
A leading program of director education,
delivered through Company Directors Courses,
briefings, seminars, the leaders’ luncheons, and
new suburban and regional events, has brought
continued growth in membership. Total
membership increased by six per cent to 3,958 at
the end of June 2002 with both new members
and renewals showing a healthy upward trend.
In addition to running eight fully-subscribed
Company Directors Courses, the division’s
program included:
• Eighteen directors’ briefings and twilight
seminars.
• Sixteen national education programs
including “The role of the chairman”,
“Fundamentals of financial statements”, and
“Board, director and CEO assessment”.
• A formal dinner with guest speaker
His Excellency the Governor-General
The Right Reverend Dr Peter Hollingworth
AC OBE speaking on corporate governance.
• Six new member evenings to cater for our
increasing membership.
With a vast area to cover, the Queensland
division set out to make its programs more
accessible to directors statewide. During the past
financial year more than 20 events were
conducted in regional centres including the
Gold Coast, Toowoomba, Sunshine Coast,
Townsville, and Cairns. This initiative has
reaped rewards with growth in number of
members of six per cent and total number of
members of 2,301.
Meeting the needs of members was also the
continuing motivation for hosting the weekend
delivery of the Company Directors Course at the
Sunshine Coast, Toowoomba, Townsville,
Cairns, and Gold Coast. This mode of presentation proved to be a very popular alternative to
the ten-week tutorial program.
It has been a busy financial year with the
division hosting eight Company Directors
Courses, and:
• Twenty-seven education programs with
particular demand for tailored in-house
training programs on governance,
fundamentals in financial statements, and
the duties and responsibilities of directors.
A new program, “Board reporting”, was
booked out within 10 days of its launch.
• Seven “Queensland Business Stories”
including Peplin Biotech, Darling Downs
Bacon, Yellow Cabs, Technology One,
Jupiters, and Stahmann Farms.
• Ten briefings, including the “Value journey
breakfast series”, “Corporate governance
and the associated risk management issues”,
“Value chain improvements”, and “Putting
a value on governance - directors' fees and
shareholder expectation”.
• Six “Bourse talk” luncheons involving
speakers such as The Hon Joe Hockey MP,
the-then Minister for Financial Services
and Regulation; John McFarlane of ANZ;
Ted Kunkel of Foster’s Group; David
Knott of the Australian Securities and
Investments Commission; Phillip Bullock of
IBM Australia NZ Ltd; and Matthew Perrin
of Billabong.
• Eight discussion forums hosted in
Toowoomba, Mackay, Cairns, Townsville,
and Brisbane, attracted great interest.
These round-table sessions encourage
members to discuss the challenges that they
face and to seek advice from the more
experienced directors present.
• Six networking events for members across
Queensland.
International speakers sourced
Fifteen leaders’ luncheons were hosted in
Melbourne featuring such guest speakers as: Paul
Anderson, then Chief Executive Officer of
BHP Billiton; Richard McCormick, World
President of the International Chamber of
Commerce; as well as Alfred Berkeley III,
President and Chairman of the Nasdaq Stock
Market Inc. Panel discussion lunches were also
well-received. The first titled, “The twenty-first
century board”, was hosted by Linda Nicholls,
Chairman of Australia Post and the second,
“Improving corporate productivity”, was hosted
by Rod Maddock, a former Chief Economist of
the Business Council of Australia.
The division also played a significant
advocacy role in representing the views of
members against the proposed Crimes
(Workplace Death and Serious Injuries) Bill
2001 that was defeated in the Victorian Upper
House.
In all, the division ran 84 courses and events
culminating in the busiest year in its history, as
well as the strongest financially. I would like to
thank the division council for its support during
the year, our committed staff, the division’s
sponsors, and the Victorian director and business
community that have contributed to this
excellent result.
Andrew Guy FAICD
Leading director honoured
Elizabeth Nosworthy was awarded our Gold
Medal Award 2001 for her outstanding contribution to directorship. Since becoming a fulltime company director in 1995, Ms Nosworthy
has been elected to 12 boards. Her current
positions include the chairmanship of Stanwell
Corporation and Prime Infrastructure and
directorships at David Jones, GPT Management,
Ventracor, and board membership of the
Queensland Treasury Corporation.
I thank our committed staff of five, the
generosity of our sponsors, and a division council
that endeavours to deliver director education
across the State.
John Massey FAICD
President
Louise Barnett Aff AICD
Queensland Division Manager
[email protected]
direct line: + 61 7 3221 4325
4
Att
me racti
mb ng
ers
President
Carey Cox FAICD
Victoria Division Manager
[email protected]
direct line: + 61 3 9211 9281
Emma Carpenter, Administrative Assistant,
Queensland Division Office
9
5
Goals of AICD
Be a successful
advocate for
directors’ issues
Achievements towards this goal during
2001—2002 include:
•
forty submissions, compiled by AICD
committees, presented to
government and government
authorities
•
policy positions on sustainability,
intangible assets, and the
requisitioning of company meetings,
endorsed by National Council.
Western Australia—stepping ahead in
director education
Serving members in South Australia and
Northern Territory
From its Rottnest Forum to its AGM
Sundowner, the Western Australia division
stands out for the individuality of its events and
for its strong growth in members of 7.3 per cent.
The division achieved its highest level of
membership this year with 1,598 members
which reflects the success of its activities.
Forty events were conducted during the
financial year including:
• The annual Rottnest Forum, involving a
flotilla of boats transporting 275 members to
Rottnest Island to hear Rod Macqueen
speak on “One step ahead—on the field and
in the boardroom”.
• The fifth Outback Forum offering members
the opportunity to visit Port Hedland for a
personal tour of BHP Billiton’s operations in
the north-west of Western Australia.
• The annual “Industry on Location”, a tour
of the Peters & Brownes Group operations
at Balcatta.
• Ten national core education programs, and
three tailored programs delivered in-house.
• Three Company Directors Course tutorial
programs.
• Support for a Company Directors Course
residential program run by the national
office.
• Two rural Company Directors Course
residential programs conducted for the
Department of Agriculture.
• Ten luncheon events, four directors’
briefings, and the annual seminar conducted
jointly with the Business Law Section of the
Law Council of Australia.
The South Australia and Northern Territory
division is managed by a team of four staff in
AICD’s Adelaide office. Support for Northern
Territory members comes from the Northern
Territory Committee, based in Darwin, reporting
to the South Australia and Northern Territory
Division Council in Adelaide.
Professionalism in directorship
recognised
At our annual Winter Dinner, managing
director of Wesfarmers, Michael Chaney, was
recognised for his professionalism in directorship
and awarded the WA Gold Medal Award 2001.
Other networking opportunities were
provided through our AGM Sundowner
function, offered on a complimentary basis to all
members, and the “Xmas Sundowner” function.
Western Director, our quarterly newsletter,
continues to inform members of coming events,
and division and national office activities.
This has been a most rewarding year due to
the invaluable contributions received from
supportive division council members, sponsors,
our dedicated staff, and the continued support
received from members.
Peter Mansell FAICD
President
Sue Pepperell Aff AICD
Mr John Hall FAICD, Chief Executive Officer,
at the "Catch the Future" Company Directors
Conference 2002.
10
Western Australia Division Manager
[email protected]
direct line: + 61 8 9322 7400
Tailored director education programs
grow in South Australia
The number of members has grown steadily at
two per cent, with a total of 1,392 members in
South Australia at the end of the financial year.
Thirty-five events were hosted for members
during the year. A listing of those events follows.
• There was strong demand for the Company
Directors Course with the four courses
booked out.
• Seven core national education courses were
offered to members.
• In-house tailored education courses were
popular within the not-for-profit and
private sectors with five courses held during
the year. We also sought to assist directors
in country regions by conducting training
sessions in rural centres.
• The success of the luncheon with guest
speaker Richard Butler AM in late 2001,
spawned the introduction of a “Thought
Leader Luncheon Series” in early 2002.
• A series of four “Bourse talk” luncheons
offered members the opportunity to hear a
number of Australia’s business leaders
including: John Ellice-Flint, Chief
Executive Officer of Santos Ltd; Les Owen,
Managing Director of AXA Ltd; Keith
Lambert, Managing Director of Southcorp
Ltd; and Allan Moss, Managing Director of
Macquarie Bank Ltd.
Great fun was had by all at an evening of wine
and jazz at the South Australia Annual Dinner
in the new National Wine Centre with guest
speaker, Sir James Hardy OBE.
Former president Richard Ryan AO stood
down as Division President after three years in
office. We extend our sincere thanks to Richard
for his effort and commitment in developing and
growing the profile of AICD in both South
Australia and the Northern Territory.
Dramatic increase in membership in
Northern Territory
An increasing presence through more
educational courses in the Northern Territory
has brought a dramatic 23 per cent increase in
members, bringing a total of 142 members.
In addition to the usual tutorial program, an
additional intensive Company Directors Course
was held in Darwin, both were fully booked.
Two national core education programs, “The
role of the chairman” and the “Skills update”,
were also well supported.
The Annual Dinner held in Darwin in April
offered the new Chief Minister of the Northern
Territory, The Hon Clare Martin, the
opportunity to address the 185 guests on the
government’s vision for business.
AICD Annual Report
Angela Downs Aff AICD
The division welcomed the opportunity of
chairing AICD’s sustainability committee task
force on climate change and of assisting in
developing policies in the area.
By way of community service the division
delivered complimentary briefings and
workshops on governance to organisations such
as the TPI Association, Aged Care Facilities,
and Australian Sports Commission (ACT). We
also participated in community-based leadership
programs for the not-for-profit sector.
I thank our staff team for their commitment,
our sponsors for their support, and the division
council for their direction.
South Australia and Northern Territory Division Manager
[email protected]
direct line: + 61 8 8211 8001
President
There was also a change in leadership of the
Northern Territory committee with Peter
Plummer retiring as chairman. We thank Peter
for his support in growing AICD in the Territory
and we wish Deborah Fracaro well as the new
chairman.
I look forward to the continuing support of
our hardworking staff, active Division Council,
and loyal sponsors in the new financial year.
Charles Bagot MAICD
President
Alan Morrison FAICD
Graeme Burgess MBE MAICD
Australian Capital Territory facilitates
education scholarship programs
Australia’s capital continues to supply a steady
growth in demand for best practice in
directorship with a 10 per cent increase in
membership growth experienced by the division,
bringing a total of 534 members at the end of the
financial year.
Public and private sector interest in the
Company Directors Course conducted by the
ACT division as a six-day non-residential
continues to grow. In the past year we were
pleased to:
• Assist in facilitating the Young People in
Rural Industries Initiative of the
Department of Agriculture, Fisheries and
Forestry. The initiative provided Company
Directors Course scholarships to 14 young
people from rural and regional Australia. A
similar program for young rural leaders has
recently been announced by the department
and we look forward to assisting national
office with its implementation.
• Host six national core education programs
and five programs tailored for in-house
presentation.
• Co-host the “White Pages Luncheon Series”
with the Canberra Business Council. This
popular information and networking
initiative has involved speakers such as Dr
Garrett, Chief Executive Officer of CSIRO;
Malcolm
Crompton,
the
Privacy
Commissioner; Ross McDiarmid, Chief
Executive Officer of Canberra Tourism and
Events Corporation; and Mark Patterson,
Secretary of Department of Industry
Tourism and Resources.
• Co-host breakfast functions with Australian
Business Limited on small business topics.
Australian Capital Territory Division Manager
[email protected]
direct line: + 61 2 6248 5954
New alliances bring greater exposure in
Tasmania
New alliances with business associations and the
success of our receptions for members has
brought steady growth of four per cent in the
number of members. The total number of
members currently stands at 681.
This
represents four per cent of the national total.
The division’s headquarters are based in Hobart
with one part-time staff member based in
Launceston to serve members in that region.
Twenty-one events were held during the
year, the highlights included:
• Four fully-booked Company Directors
Courses held as five-day non-residential
courses.
• Nine national core education programs
including a record number of five “New
director” programs. All courses were fully
booked and demand appears to be growing.
• Five luncheon events with the speakers
David Knott, Chairman of ASIC and Saul
Eslake, Chief Economist of ANZ Bank
attracting the largest followings in Hobart
and Launceston, respectively.
• Three member receptions drawing more
than 100 guests on each occasion.
Award for service to business
It was with great pleasure that the division
recognised AICD life membership and the
leadership qualities and service to the business
community of Ron Banks AM. The Gold Medal
Award was presented to Mr Banks by the State
Governor, the Hon. Sir Guy Green AC KBE, at
our Gold Medal Dinner.
This year we formed an alliance with
Women Tasmania, an organisation devoted to
the advancement of women in business. Several
of their members attended our training courses
during the year. We look forward to continuing
the association. In northern Tasmania, a joint
association with the Launceston Chamber of
Commerce has brought valuable exchange of
information for both organisations.
Exchange of information continues to take
place through our quarterly newsletter which
informs members of State news and opinions
and division events.
Our division staff must be congratulated in
assessing and meeting the needs of members and
in continuing the momentum for new alliances
and events for members. Thanks also to division
councillors and our sponsors for their support.
Gerald Loughran FAICD
President
Len Robertshaw MAICD
Tasmania Division Manager
lrobertshaw@companydirectors,com.au
direct line: + 61 3 6224 0559
5
Advocacy
Manu Ramachandran, Account Executive,
Company Director journal, National Office
11
6
Goals of AICD
Be a financially
sound, efficient,
and caring
organisation
Achievements towards this goal during
2001—2002 include:
•
membership funds stand at
$5,080,079 as at 30 June 2002
•
a new compliance program
developed and to be implemented in
the next financial year
•
introduction of “The Employee
Support System” providing an AICD
employee manual online and
personal advice with a consultant on
call.
Corporate Governance
T
he governance of Australian Institute of
Company Directors is founded on various
charters. The key charters are those for
National Council, the Division Councils, the
Audit Committee, the Human Resources and
Remuneration Committee, the National
Education Committee, and the policy
committees.
National Council
The National Council is the board of directors
and governing body of AICD. Its powers are set
by the Articles of Association.
Composition of National Council
The National Council consists of 11 nonexecutive directors being, the National
President, two National Vice-Presidents, the
National Treasurer, and seven representatives,
one from each division. All directors are
members of AICD and do not receive any
remuneration for their services to AICD. No
office bearer may be in office for more than eight
consecutive years and no President, or VicePresident, may hold office for more than three
consecutive years.
Role of National Council
The National Council is responsible for the
overall corporate governance of AICD. This
includes setting and periodically reviewing the
strategic direction, making policy decisions on
behalf of Australian directors, and monitoring
the achievements and financial performance of
the organisation.
To assist in the performance of their duties,
the directors may seek independent professional
advice, at AICD’s expense.
Seven meetings of the National Council
have been held during the fiscal year. The
National President acts as chairman.
Division Councils
The role of the Division Council is to
administer the divisions. In most States and
Terroritories the divisions consist of 10 elected
members who elect a President, Deputy
President, and a Treasurer/Secretary. As a
primary interface with members, the Division
Council is involved in the organisation of State
activities and communicates member views on
policy and education initiatives through the
Divisional Representative who also sits on
National Council.
Committees
To improve its efficiency, National Council
delegates roles to various committees and
taskforces. Those committees include the Audit
Committee, the Human Resources and
Remuneration Committee, the National
Education Committee, the Company Directors
Conference Commitee, and the four policy
committees—law, accounting and financial
advisory, taxation and economics, and sustainability. National Council annually reviews and
ratifies the terms of reference of these
committees and their membership.
12
Audit Committee
The role of the Audit Committee is documented
in a charter which is approved by National
Council. The committee reviews and monitors
the compliance program and financial systems
operating in AICD providing a direct link
between National Council and the external
auditors and management.
The committee ensures there are procedures
in place to safeguard AICD’s assets and interests,
including accounting, financial reporting,
expenditure and investment policies, in
compliance with applicable laws, regulations,
standards, and best practice guidelines. It also
oversees the continuing independence of the
external auditor.
The Audit Committee comprises three
members appointed by the National Council
and is chaired by the National Treasurer.
Members of the committee over the past
financial year were the National Treasurer
Mr Graeme McGregor AO FAICD, National
Councillor Mr John Massey FAICD, and
Mr Robert Graham FAICD, a recently retired
National Councillor.
Six meetings of the committee were held
during the year addressing the change of auditors
from Andersen to Ernst & Young, the
development of the new AICD compliance
programme, the review of AICD privacy policy,
the review of AICD insurance arrangements,
and matters relating to financial reporting and
performance of the entity.
Human Resources and Remuneration
Committee
Monitoring of the human resources, staff
remuneration and benefits, and staff policies and
procedures of AICD is undertaken by
the Human Resources and Remuneration
Committee. Four council members sit on the
committee and the National President acts as
chairperson. Its members during the past
financial year were: National President,
Miss Elizabeth Alexander AM FAICD; National
Vice-Presidents, Mr Don Mercer FAICD and
Dr Ken Moss FAICD; National Treasurer,
Mr Graeme McGregor AO FAICD; and former
Council member Mr Robert Graham FAICD.
Mr Graham retired from the committee on
29 October 2001. Two meetings were convened
during the year at which matters such as the new
Employee Support System and remuneration
were discussed.
National Education Committee
The role of the National Education Committee
(NEC) is to ensure the relevance and quality of
the Company Directors Course and other core
education programs is maintained. It is
constituted by experienced directors, academics,
and consultants. The committee reports and
makes recommendations to National Council.
The position of chairman is reviewed annually
and during the past financial year the position
was held by Mr John Dugas MAICD.
AICD Annual Report
Division Councils
Company Directors Course Assessment
Review Committee
As a subcommittee of the NEC, the Company
Directors
Course
Assessment
Review
Committee periodically reviews and updates the
assessment component of the Company
Directors Course and makes recommendations
to the NEC on the assessment process, and
materials. Directors, tutors, examiners, and
AICD members who have recently completed
the Company Directors Course sit on the
committee. The position of chairman is
reviewed annually and during the past financial
year the position was held by Mr John Dugas
MAICD.
Australian Capital Territory Division
Council
Mr Gerald Loughran FAICD, President
Mr Alan Morrison FAICD, President
Mr James Morris FAICD, Vice-President
Mr Richard Bialkowski FAICD
Mr Ross Cottrill FAICD
Ms June Grainger FAICD
Dr Dick Henley FAICD
Mr Derek Lark FAICD*
Ms Noela L‘Estrange FAICD
Mr Denis O’Brien MAICD*
Ms Carolyn Riley GAICD
Ms Deborah Robinson FAICD
Dr Alison Turner FAICD
Company Directors Conference
Committee
* Retired during the year
The continuing relevance of the Company
Directors Conference program is monitored by
the Company Directors Conference Committee.
Directors, academics, and business leaders sit on
the committee. The chairman during the past
financial year was Ms Linda Nicholls FAICD.
New South Wales Division Council
Policy Committees
The four policy committees—law, accounting
and financial advisory, taxation and economics,
and sustainability—develop policy and best
practice guidelines on director-related issues
arising in their respective fields. A large part of
committee time is spent on preparing
submissions in response to various government
inquiries. Policies, guidelines, and submissions
developed by the committees are then ratified by
National Council.
Committee or taskforce meetings are held
on a monthly basis and the position of chairman
is reviewed by National Council on an annual
basis. Committee chairmen during the past
financial year were Professor Bob Baxt FAICD of
the law committee, Mr Michael Coleman
FAICD of the accounting and financial advisory
committee, Mr Simon Marks-Isaacs FAICD of
the taxation and economics committee, and
Dr Keith Suter FAICD of the sustainability
committee.
Adherence to ethical standards
All members abide by the principles contained
in the AICD publication, Code of Conduct. This
code for directors was introduced in 1996 to
promote the highest ethical and professional
standards in directorship of Australian
companies and other bodies.
National Council has adopted the code and
all members follow the principles set out in the
code. Those principles call for honesty, due care
and diligence, and adherence to the spirit, as
well as the letter of the law.
Members involved in governing AICD are
aware that their core responsibility is to act in
the interests of members.
A similar code of conduct statement titled,
AICD Values, is followed by AICD staff. This
statement sets out 10 core values outlining the
staff’s commitment to members, team work,
excellence, sound financial management,
recognition of achievement, and enjoyment of
their role.
Tasmania Division Council
Ms Eva Plachta MAICD, Vice-President
Mr William Downie FAICD*
Mr Clyde Eastaugh MAICD
Mr Miles Hampton FAICD
Mr Ashley Harris FAICD
Mr Ken Lawrie FAICD
Mr Graham Marshall FAICD
Mr Mick Morris FAICD
Mr Russell Paterson FAICD
Mr Val Smith FAICD*
Mr Paul Swifte FAICD
* Retired during the year
Victoria Division Council
Mr Andrew Guy FAICD, President
Mr James Green FAICD, President
Mr Malcolm Irving AM FAICD, Vice-President
Mr Hugh Anderson FAICD, Treasurer
Mr J Gillis Broinowski FAICD
Mr Gavin Campbell FAICD*
Mr Robert Chaloner FAICD*
Ms Megan Alexander Cornelius AM FAICD
Mr Geoff De Lacy FAICD
Mr Robert Graham FAICD*
Mr Rob Hines MAICD*
Prof Dame Leonie Kramer AC DBE FAICD*
Dr Helen Nugent FAICD*
Ms Anne Riches FAICD
Ms Ouma Sananikone MAICD
Dr Paul Scully-Power DSM DSC FRAeS
FAICD
Mr Brian Wilson FAICD
* Retired during the year
Queensland Division Council
Mr John Massey FAICD, President
Dr Jane Wilson FAICD, Vice-President
Mr Ian Fraser MAICD, Treasurer
Mr Rob Hines MAICD
Mr Ben Kehoe FAICD
Mr Martin Kriewaldt FAICD
Mr John Lister MAICD
Ms Marian Micalizzi MAICD
Ms Susan Rix GAICD
Mr John Story FAICD
Mr Greg Swindon FAICD*
* Retired during the year
South Australia and Northern Territory
Mr Glenn Barnes FAICD
Mr Cliff Breeze FAICD*
Mr Laurie Cox AO FAICD
Ms Patricia Cross FAICD
Mrs Marina Darling MAICD
Commissioner Douglas Davis MAICD
Mr Russell Fynmore AO FAICD*
Mr Graham Kraehe MAICD
Mr Charles Macek FAICD
Mr David Stewart FAICD
Mr Rob Wylie MAICD
* Retired during the year
Western Australia Division Council
Mr Peter Mansell FAICD, President
Mr Terry Budge FAICD, Vice-President
Ms Fiona Harris FAICD, Treasurer
Ms Robyn Ahern MAICD
Prof. Ian Constable FAICD
Mr David Eiszele FAICD
Dr Jim Gill FAICD*
Mr Mike Horabin FAICD
Mr Tony HowarthMAICD
Mr Malcolm Macpherson
FAICD
Mr Tim Moore FAICD
* Retired during the year
6
Caring
Mr Charles Bagot MAICD, President
Mr Sam Walters FAICD, Vice-President
Mr Nicholas Begakis AM FAICD*
Mr Morris Crosby GAICD
Mr Brian Guthleben FAICD
Ms Virginia Hickey FAICD
Mr Adam Keats GAICD
Ms Alice McCleary FAICD
Mr Ray Michell FAICD
Mr Richard Ryan AO FAICD
Mr Richard Thomson FAICD
Mr Stephen Young FAICD*
* Retired during the year
Judith Winn, Membership & Education Manager,
Queensland Division Office
13
AICD Committees
Australian Institute of Company
Directors sincerely thanks the
following members for their time in
developing government submissions
and policy statements or quality
education courses and publications.
Accounting and Financial
Advisory Committee
Chairman
Mr Michael Coleman FAICD
Deputy Chairman
Mr Mark Johnson FAICD
Mr Kevin Adams FAICD
Miss Elizabeth Alexander AM FAICD
Mr John Allpass FAICD
Mr James Beecher FAICD
Mr Peter Cadwallader FAICD
Mr Gavin Campbell FAICD
Mr Geoff De Lacy FAICD
Mr Jim Dixon
Mr Lloyd Draney FAICD
Mr Stuart Grant FAICD
Mr Frank Haly AO FAICD*
Mr Stephen Harrison AO FAICD
Mr Mike Kooymans**
Mr John Lamble AO FAICD
Ms Marian Micalizzi MAICD
Ms Susan Oldmeadow-Hall Aff AICD
Mr Russell Philp MAICD
Ms Eva Plachta MAICD
Mr Tom Pockett
Mr Bruce Porter
Mr Keith Reilly
Mr Antony Robb FAICD
Mr James Service AM FAICD
Law Committee
Chairman
Prof Bob Baxt FAICD
Mr Charles Bagot MAICD
Mr Bill Beerworth FAICD
Mr Tom Bostock FAICD
Mr Quentin Digby MAICD
Prof. John Farrar
Mr Ian Harper AM FAICD
Mr Rob Heferen**
Mr Tony Hulett
Mr Stephen Ipp
Prof. Dimity Kingsford-Smith
Mr Bill Koeck MAICD
Mr Michael Lishman MAICD
Mr Andrew Lumsden MAICD
Mr Peter Mansell FAICD
Dr Ian McEwin MAICD
Mr Ben McLaughlin MAICD
Mr Alan Morrison FAICD
Prof. Ian Ramsay
Mr Andrew Ray
Ms Carolyn Riley GAICD
Mr Peter Shaw MAICD
Dr Geof Stapledon
Mr John Story FAICD
Mr Paul Swifte FAICD
Mr Brian Wilson FAICD
Mr Colin Wise FAICD
14
Sustainability Committee
Chairman
Dr Keith Suter FAICD
Ms Sybella Blencowe MAICD
Mr Graeme Day MAICD
Mr Peter Emery FAICD
Mr Paul Flanagan GAICD
Mr Robert Foster MAICD*
Mr Garry Fowler FAICD
Dr Richard Henley FAICD
Mr John Kenny MAICD
Mr Kenneth Lawrie FAICD
Mr John Lister MAICD
Mr Damien Lynch FAICD*
Mr Malcolm Macpherson FAICD
Mr Duncan McGregor MAICD
Ms Ouma Sananikone MAICD
Dr Alison Turner FAICD
Mr Hugh Wyndham Aff AICD
Taxation and Economics
Committee
Chairman
Mr Simon Marks-Isaacs FAICD
Miss Elizabeth Alexander AM FAICD
Mr Hugh Anderson FAICD
Mr Philip Anderson
Mr Bill Beerworth FAICD
Mr Richard Bialkowski FAICD
Mr Terry Budge FAICD*
Mr Ross Cottrill FAICD
Mr Ashley Harris FAICD
Mr Stephen Hopley
Mr Martin Kriewaldt FAICD
Mr Geoff Lehmann
Ms Ivy Loh Aff AICD
Ms Alice McCleary FAICD
Ms Glenda Nixon FAICD
Mr David Stewart FAICD*
Ms Suit Fun Tham*
Dr Neil Warren
Remuneration Task Force
Chairman
Dr Ken Moss FAICD
Mr Charles Bagot MAICD
Mr John Colvin FAICD
Mr David Crawford FAICD
Mr John Egan FAICD
Mr Peter Griffin FAICD
Mr Charles Macek FAICD
Ms Anne Riches FAICD
Mr Chris Thomas FAICD
National Education Committee
Chairman
Mr John Dugas MAICD
Mr Bill Bickford FAICD
Mrs Kate Costello FAICD
Mr Barry Hicks
Mr Mike Horabin FAICD
Prof. Geoff Kiel FAICD
Ms Bronwyn Morgan FAICD
Mrs Alice Oppen FAICD
Ms Anne Riches FAICD
Prof. Peter Sheldrake FAICD
Company Directors Course
Assessment Review Committee
Chairman
Mr John Dugas MAICD
Mr Geoff Allanson FAICD
Mr Richard Dixon-Hughes FAICD
Mr Martin Donnelly GAICD
Ms Carol Gilchrist GAICD
Mr Richard Harris FAICD
Mr Luke Heath FAICD
Mr Mervyn Hill FAICD
Ms Susan Lenehan FAICD
Mr Gavin May GAICD
Ms Bronwyn Morgan FAICD
Mrs Alice Oppen FAICD
Ms Anne Riches FAICD
Mr David Shearwood GAICD
Mr Craig Tapper FAICD
Company Directors Conference
Committee
Chairman
Ms Linda Nicholls FAICD
Mr Peter Carre MAICD
Mr Michael Coleman FAICD
Mr Bryan Ericson MAICD
Ms Elizabeth Johnstone*
Mr John Massey FAICD*
Mr David Pumphrey MAICD
Prof. Michael Vitale MAICD
*denotes retired during the year
**denotes ex officio members of the committee
AICD Annual Report
Financial Report for the year ended 30 June 2002
Independent Audit Report
16
Directors’ Report
16
Statement of Financial Position
18
Statement of Financial Performance
18
Statement of Cash Flows
18
Notes to the Financial Statements
19
1. Summary of accounting policies
2. Net profit
3. Receivables
4. Other financial assets
5. Inventories
6. Other assets
7. Plant and equipment
8. Payables (current)
9. Interest-bearing liabilities (current)
10. Other provisions (current)
11. Other liabilities (current)
12. Other provisions (non-current)
13. Members’ funds
14. Retained profits
15. Commitments under non-cancellable operating leases
16. Remuneration of officers
17. Remuneration of auditors
18. Finance lease commitments
19. Related party disclosures
20. Financial reporting by segments
21. Notes to the statement of cash flows
22. Financial instruments
23. Employee entitlements
24. Contingent liabilities
Directors’ Declaration
19
20
20
20
20
20
20
21
21
21
21
21
21
21
21
21
21
22
22
22
22
22
23
23
24
15
Independent Audit Report
Directors’ Report
To the members of Australian Institute of Company Directors
The National Councillors (the directors) of Australian Institute of Company
Directors (AICD) submit their report in respect of the financial year ended 30
June 2002.
Scope
We have audited the financial report of Australian Institute of Company
Directors for the financial year ended 30 June 2002, as set out on pages 18 to
23. The company’s directors are responsible for the financial report. We have
conducted an independent audit of the financial report in order to express an
opinion on it to the members of the company.
Our audit has been conducted in accordance with Australian Auditing
Standards to provide reasonable assurance whether the financial report is free
of material misstatement. Our procedures included examination, on a test basis,
of evidence supporting the amounts and other disclosures in the financial
report, and the evaluation of accounting policies and significant accounting
estimates. These procedures have been undertaken to form an opinion whether,
in all material respects, the financial report is presented fairly in accordance
with Accounting Standards, other mandatory professional reporting
requirements and statutory requirements in Australia, so as to present a view
which is consistent with our understanding of the company’s financial position
and performance as represented by results of its operations and its cash flows.
The audit opinion expressed in this report has been formed on the above basis.
Audit opinion
Directors
The names of the directors in office during or since the end of the financial year
are:
Ms Elizabeth Alexander AM FAICD
Dr Kenneth Moss FAICD
Mr Donald Mercer FAICD
Mr Graeme McGregor AO FAICD
Mr Charles Neville Bagot MAICD
Mr Clifford Breeze FAICD
Mr Robert Eyton Chaloner FAICD
Dr James Gill FAICD
Mr Robert Graham FAICD
Mr Maxwell James Green FAICD
Mr Andrew Frank Guy FAICD
Mr Gerald Norman Loughran FAICD
Mr Peter John Mansell FAICD
Mr John Massey FAICD
Mr Alan Morrison FAICD
Mr Richard Ryan AO FAICD
Mr Valentine Roy Smith FAICD
National President
National Vice President
National Vice President
National Treasurer
(appointed 29.10.2001)
(retired 16.10.2001)
(appointed 29.10.2001, retired 25.02.2002)
(retired 24.09.2001)
(retired 29.10.2001)
(appointed 25.02.2002)
(appointed 16.10.2001)
(appointed 01.10.2001)
(appointed 27.09.2001)
(appointed 30.10.2000)
(appointed 30.10.2000)
(retired 29.10.2001)
(retired 01.10.2001)
In our opinion, the financial report of Australian Institute of Company
Directors is in accordance with:
Details of directors are included on page 7 of the annual report.
(a) the Corporations Act 2001, including:
Meeting attendances
(i)
giving a true and fair view of the company’s financial position as at
30 June 2002 and its performance for the year ended on that date; and
The meeting attendance of the National Councillors during the year 1 July
2001 to 30 June 2002 is noted below.
(ii)
complying with Accounting Standards in Australia and the
Corporations Regulations 2001; and
Councillor
(b) other mandatory professional reporting requirements in Australia.
Ernst & Young
Chartered Accountants
Karen Ray
Partner
Sydney, 12 September 2002
Ms Elizabeth Alexander AM
Mr Don Mercer
Dr Ken Moss
Mr Graeme McGregor AO
Mr Cliff Breeze 1
Mr Andrew Guy 2
Mr Jim Gill 3
Mr Robert Graham
Mr John Massey
Mr Alan Morrison
Mr Richard Ryan AO 5
Mr Valentine Smith6
Mr Gerald Loughran7
Mr Peter Mansell 8
Mr Robert Chaloner 9
Mr Charles Bagot 10
Mr James Green 11
National
Council
7 of 7
7 of 7
5 of 7
5 of 7
2 of 2
5 of 5
2 of 2
2 of 24
7 of 7
7 of 7
1 of 2
1 of 2
4 of 5
5 of 5
3 of 3
5 of 5
2 of 2
Audit
Committee
Remuneration
Committee
6 of 6
2 of 2
1 of 2
2 of 2
2 of 2
6 of 6
6 of 6
1 of 14
1. Retired 16.10.01, 2. Appointed 16.10.01, 3. Retired 24.09.01, 4. Retired
29.10.01, 5. Retired 29.10.01, 6. Retired 01.10.01, 7. Appointed 01.10.01,
8. Appointed 27.09.01, 9. Retired 25.02.02, 10. Appointed 29.10.01,
11. Appointed 25.02.02
Principal activities
16
The principal activities of AICD, constituted through its National Office and
seven divisions, during the financial year, were the conduct of educational
activities including the Company Directors Course, Company Directors
Conference, panel discussions, seminars, breakfasts, luncheons and dinners; the
publication of articles and statements on matters of interest to directors; liaison
with other professional bodies and the Stock Exchange on matters affecting
directors and companies; consultations with, and submissions to, government
particularly on the Corporations Act 2001, commissions of inquiry and other
public authorities about the framing of laws and regulations of concern to
directors and the corporate system in Australia. During the financial year there
was no significant change in the nature of those activities.
AICD Annual Report
Financial results
Likely developments and future results
The net amount of AICD’s profit for the financial year was $2,021,245. This
represents a significant increase on the 2001 result of $591,253. Australian
Institute of Company Directors is a company limited by guarantee and no
dividends are payable.
There are no likely developments in the operations of AICD which would
affect the results of future operations.
Signed in accordance with a resolution of the directors made pursuant to
section 298(2) of the Corporations Act 2001.
Review of operations
On behalf of the directors
A review of the operations of AICD during the financial year and the results of
those operations is contained in the report by the President and Chief
Executive Officer, contained on pages 2 and 3 of the annual report.
Significant changes in state of affairs
E A Alexander AM FAICD
National President
During the financial year there was no significant change in the state of affairs
of AICD.
Indemnification of officers and auditors
During the financial year, the company paid a premium in respect of a contract
insuring the directors of the company (as named above), the company secretary,
and all executive officers of the company and of any related body corporate,
against a liability incurred as such a director, secretary, or executive officer to
the extent permitted by the Corporations Act 2001. The contract of insurance
prohibits disclosure of the nature of the liability and the amount of the
premium.
The company has not otherwise, during or since the financial year,
indemnified or agreed to indemnify an officer or auditor of the company or of
any related body corporate against a liability incurred as such an officer or
auditor.
G W McGregor AO FAICD
National Treasurer
Melbourne, 12 September 2002
Directors’ and officers’ remuneration
The directors of the company are appointed on a honorary basis and as a result
do not receive any remuneration either directly or indirectly from the company
or any related party.
No director can hold an interest in AICD as it is a company limited by
guarantee. Each director, being a member, is liable to the extent of the
guarantee given under the Memorandum and Articles of Association. No
director of AICD has received or become entitled to receive a benefit during or
since the end of the financial year because of a contract that the director or a
firm of which the director is a member or an entity in which the director has a
substantial financial interest made with the company or an entity that the
company controlled, or a body corporate that was related to the company when
the contract was made or when the director received or became entitled to
receive a benefit.
Remuneration of senior executives of the company is established by the
Human Resources and Remuneration Committee. Remuneration is determined
as part of an annual performance review, having regard to market factors, a
performance evaluation process and independent remuneration advice. For
executive officers, remuneration packages generally comprise salary, a
performance-based bonus, and superannuation.
Significant events after year end
There has not been any matter or circumstance that has arisen since the end of
the financial year, that has significantly affected, or may significantly affect, the
operations of AICD, the results of those operations, or the state of affairs of
AICD in financial years after this financial year.
17
Statement of Financial Position
Statement of Financial Performance
At 30 June 2002
Year ended 30 June 2002
Notes
Current assets
Cash assets
Receivables
Other financial assets
Inventories
Other assets
22
3
4
5
6
Total current assets
Non-current assets
Plant and equipment
7
Total non-current assets
Total assets
Current liabilities
Payables
Interest bearing liabilities
Other provisions
Other liabilities
8
9
10
11
2002
2001
$
$
445,653
448,662
7,421,128
102,604
344,356
1,123,954
482,566
4,352,152
107,037
332,674
8,762,403
6,398,383
404,678
167,743
404,678
167,743
9,167,081
6,566,126
1,662,513
386,004
1,822,379
1,547,731
93
237,597
1,544,422
3,870,896
3,329,843
216,106
177,449
216,106
177,449
Total liabilities
4,087,002
3,507,292
Net assets
5,080,079
3,058,834
5,080,079
3,058,834
5,080,079
3,058,834
Total current liabilities
Non-current liabilities
Other provisions
12
Total non-current liabilities
Members’ funds
Retained profits
Total members’ funds
14
Notes
Revenue from ordinary activities
- Sale of goods
2002
2001
$
$
265,114
310,856
168,859
123,975
96,255
186,881
8,649,152
5,377,259
1,110,687
76,074
6,677,307
4,807,237
1,247,563
132,053
2
15,213,172
12,864,160
2
467,512
445,407
5,912,231
1,919,979
1,082,215
4,822,352
18,917
5,308,704
1,358,441
1,336,148
4,888,206
13,696
13,755,694
12,905,195
2
Cost of sales
Gross profit from sale of goods
Revenue from ordinary activities
- Provision of services
Education, professional development,
and events
Membership
Publishing
Projects
- Other revenue
Expenses from ordinary activities
Education, professional development,
and events
Membership
Publishing
Administration
Other
Net profit
2,021,245
591,253
Statement of Cash Flows
Year ended 30 June 2002
Notes
2002
2001
$
$
Cash flows from operating activities
Receipts from activities and donors
Payments to suppliers and employees
GST paid
Interest received
Interest paid
Net cash provided by operating
activities
15,654,186
(12,574,189)
(641,002)
313,834
-
21(b)
2,752,829
1,673,377
Cash flows from investing activities
Payment for plant and equipment
Proceeds from sale of plant and equipment
(362,061)
-
(117,570)
4,545
Net cash used in investing activities
(362,061)
(113,025)
(93)
(2,676)
Net increase in cash held
2,390,675
1,557,676
Cash at the beginning of the financial year
5,476,106
3,918,430
Cash at the end of the
financial year
7,866,781
5,476,106
Cash flows from financing activities
Repayment of lease principal
The accompanying notes form an integral part of these
statements of financial position, financial performance,
and cash flows.
18
13,449,347
(11,441,044)
(587,840)
253,123
(209)
21(a)
AICD Annual Report
Notes to the Financial Statements
For the year ended 30 June 2002
1. Summary of accounting policies
(f ) Leased assets
Financial reporting framework
Operating lease assets are not capitalised and rental payments are expensed in
the period in which they are incurred.
The financial statements have been prepared as a general purpose financial
report which complies with the requirements of the Corporations Act 2001,
Australian Accounting Standards and Urgent Issues Group Consensus Views.
The financial statements have been prepared in accordance with the historic
cost convention and do not take account of changes in either the purchasing
power of the dollar or in the prices of specific assets.
(g) Recoverable amount of non-current assets
Non-current assets are written down to recoverable amount where the carrying
value of any non-current asset exceeds recoverable amount. In determining the
recoverable amount of non-current assets, the expected net cash flows have not
been discounted to their present value.
Significant accounting policies
(h) Accounts payable
Accounting policies are selected and applied in a manner which ensures that
the resultant financial information satisfies the concepts of relevance and
reliability, thereby ensuring that the substance of the underlying transactions
and other events is reported. The accounting policies used are consistent with
those adopted in the previous year.
Trade payables and other accounts payable are recognised when the company
becomes obliged to make future payments resulting from purchases of goods and
services.
(i)
The following significant accounting policies have been adopted in the
preparation and presentation of the financial report:
(a) Depreciation
Depreciation is provided on plant and equipment and is calculated on a straight
line basis so as to write off the net cost of each asset during its useful economic
life. Assessments of remaining useful economic lives are made on a regular basis
for all assets. Leasehold improvements are depreciated over the period of the
lease or estimated useful life, whichever is the shorter, as follows.
Office furniture and equipment
Leasehold improvements
Life
Method
2-6 years
6-7 years
Straight line
Straight line
(b) Inventories
Inventories are valued at the lower of cost and net realisable value. Costs are
assigned to inventory on hand and on a first in first out basis.
Provision for employee entitlements
Provision has been made in the financial statements for benefits accruing to
employees in relation to annual leave and long service leave. No provision is
made for non-vesting sick leave as the anticipated pattern of future sick leave
taken indicates that accumulated non-vesting leave will never be paid.
All on-costs, including payroll tax, workers’ compensation premiums, and
fringe benefits tax are included in the determination of provisions. Annual
leave and the current portion of long service leave and workers’ compensation
provisions are measured at their nominal amounts.
The measurement of the long term portion of long service leave at nominal
value is a departure from AASB 1028 “Accounting for Employee Entitlements”.
The directors are of the opinion that the estimates relating to the rate of
increase in employee wages and salary rates together with the uncertainty as to
when the entitlements will be paid, are such that they do not justify the
calculations for the value of the information provided and that in any event,
the bringing to account of this portion of long service leave at its nominal value
will provide an estimate not materially different from that derived using the
present value basis of measurement.
Employee bonuses are recognised in the financial year in which the
performance related to the bonus occurred.
(c) Income tax
(j) Financial instruments
Section 50 of the Income Tax Assessment Act 1997 provides that certain
institutions will be exempt from income tax. Australian Institute of Company
Directors falls specifically under Section 50-5 of the Act.
Financial instruments are included in assets.
Trade receivables are initially recorded at the amount of contracted proceeds.
(d) Revenue recognition
(i) Membership
Annual membership subscription revenue is recognised on renewal date.
(ii) Functions, education and professional development
Revenue from functions, education, and professional development
activities are recognised when the function or course is held.
(iii) Membership services and Company Director
Revenue from the Company Director journal and other member
publications are recognised on issue of the publication.
(iv) Projects
Revenue from projects is recognised when incurred.
(v) Publications
Revenue from publications is recognised at the time of sale.
Provision for doubtful debts is recognised to the extent that recovery of the
outstanding receivable balance is considered less than likely. A specific
provision is maintained for identified doubtful debts, and a general provision is
maintained in respect of receivables which are doubtful of recovery but which
have not been specifically identified.
(e) Unearned revenue
(i) Subscriptions in advance
Membership subscription receipts attributable to renewals occurring in the
current financial year are brought to account as revenue. Subscription
receipts wholly relating to the next financial year are shown in the
Statement of Financial Position as subscriptions in advance. Subscriptions
are not refundable.
(ii) Income in advance
Income received in advance consists of fees received during the year of
income for courses and functions that are to be held after balance date.
19
Notes to the Financial Statements for the year ended 30 June 2002
2002
2001
$
$
2002
2001
$
$
7,421,128
4,352,152
102,604
107,037
Accrued income
Prepayments
133,604
210,752
195,779
136,895
Total other assets
344,356
332,674
Plant and equipment at cost:
Leasehold improvements
Cost
Opening balance
Additions
Disposals
75,660
157,861
(73,708)
73,708
1,952
-
Closing balance
159,813
75,660
Accumulated amortisation
Opening balance
Amortisation for the year
Disposals
74,094
11,566
(73,923)
33,941
40,153
-
Closing balance
11,737
74,094
Net book value
148,076
1,566
Office furniture and equipment
Cost
Opening balance
Additions
Disposals
782,156
204,200
(220,608)
807,290
115,613
(140,747)
Closing balance
765,748
782,156
Accumulated depreciation
Opening balance
Depreciation for the year
Disposals
615,979
100,923
(207,756)
630,378
122,232
(136,631)
Closing balance
509,146
615,979
Net book value
256,602
166,177
Plant and equipment under lease:
Cost
Opening balance
-
8,975
Closing balance
-
8,975
-
6,731
2,244
2. Net profit
4. Other financial assets
Profit from ordinary activities includes the following items of revenue and
expense:
Short-term investments
5. Inventories
Operating revenue
Publications (at cost)
Revenue from core activities:
Sale of goods
Publications
6. Other assets
265,114
310,856
Provision of services
Education, professional development, & events 8,649,152
Membership
5,377,259
Publishing
1,110,687
Projects
76,074
6,677,307
4,807,237
1,247,563
132,053
15,213,172
12,864,160
Gross proceeds on sale of plant and equipment (a)
Other income
153,678
Interest received
313,834
4,545
187,739
253,123
467,512
445,407
15,945,798
13,620,423
Other revenue
Total operating revenue
Profit from ordinary activities is after charging the following expenses:
Obsolete inventory
Depreciation and amortisation:
Plant and equipment
- depreciation
- amortisation
Operating lease rental expense:
- Premises
Finance leases:
- Finance charge
Transfers to provisions:
- Long-service leave
- Annual leave
Bad and doubtful expense
Specific disclosure items above:
(a) Revenue from sale of plant and equipment
Expense from sale of plant and equipment
Gain/(loss) on sale or disposal of plant
and equipment
16,846
5,899
100,923
11,566
122,236
42,399
564,090
329,124
-
209
126,944
15,296
-
61,721
28,405
6,386
(12,637)
(12,637)
4,545
(4,136)
409
3. Receivables
Current:
Trade receivables
Provision for doubtful debts
Other receivables
Total receivables
7. Plant and equipment
368,639
(6,000)
303,558
(6,000)
362,639
297,558
86,023
185,008
Accumulated depreciation
Opening balance
Amortisation for the year
448,662
482,566
Closing balance
-
8,975
Net book value
-
-
404,678
167,743
Total plant and equipment, net
20
AICD Annual Report
Notes to the Financial Statements for the year ended 30 June 2002
2002
2001
$
$
8. Payables (current)
Trade payables
Other creditors and accruals
462,212
1,200,301
135,011
1,412,720
1,662,513
1,547,731
2001
$
$
Operating leases are in respect of office premises. Rental agreements for some
premises are on a monthly basis. Other operating leases are for fixed periods
with generally fixed rental payments and have inflation escalation clauses.
A renewal option exists for one property for a period of three years that can be
exercised at the company’s discretion.
No operating leases contain restrictions on dividends or financing.
9. Interest-bearing liabilities (current)
Secured:
Finance lease liabilities (note 18)
2002
16. Remuneration of officers
-
93
-
93
Income of directors
The implicit interest rate on the finance lease is 13.86%. The lease is secured
by the assets leased.
The directors of the company are appointed on an honorary basis and as a result
do not receive any remuneration either directly or indirectly from the company
or any related party.
10. Other provisions (current)
Income of executives
Employee entitlements:
Annual leave
Long-service leave
Rent-free equalisation
268,991
117,013
-
202,103
28,726
6,768
386,004
237,597
1,660,074
162,305
1,379,759
164,663
1,822,379
1,544,422
11. Other liabilities (current)
Income received in advance
Subscriptions in advance
12. Other provisions (non-current)
Employee entitlements:
Long-service leave
216,106
177,449
216,106
177,449
13. Members’ funds
The use of the description “Members’ Funds” is a departure from the title
“Contributed Equity” contained in the Corporations Act 2001. Members’
Funds more appropriately reflects the fact the company is a company limited by
guarantee.
If the company is wound up, the articles of association state that each
member is required to contribute a maximum of $20 towards meeting any
outstanding obligations of the company. At 30 June 2002, the number of
members was 16,365 (2001: 15,687).
14. Retained profits
Retained profits at the beginning of the
financial year
Net profit
3,058,834
2,021,245
2,467,581
591,253
Retained profits at the end of the financial year
5,080,079
3,058,834
15. Commitments under non-cancellable operating leases
Premises:
Not later than 1 year
Later than 1 year but not later than 5 years
410,559
469,223
242,826
141,090
879,782
383,916
The number of executive officers whose total income for the year falls within
the following bands, were:
$
2002
2001
3
2
1
1
1
1
4
1
1
1
-
$1,270,348
$1,092,297
$
100,000 - 109,999
120,000 - 129,999
130,000 - 139,999
140,000 - 149,999
150,000 - 159,999
210,000 - 219,999
330,000 - 339,999
The aggregate income of the executives
referred to above:
The above table includes bonus payments allocated in accordance with the
policy set out in Note 1(i).
Income of executives comprises amounts paid or payable to executive officers
domiciled in Australia, directly or indirectly, by the company or any related
party (but excluding amounts disclosed later in this note under ‘’retirement
benefits’’) in connection with the management of the affairs of the entity or
economic entity, whether as executive officers or otherwise.
17. Remuneration of auditors
Amounts received, or due and receivable, for the audit of the financial report
- Ernst & Young
- Andersen
2002
2001
14,500
9,500
24,300
24,000
24,300
Amounts received, or due and receivable by the auditor of other services
- Ernst & Young
Preparation of financial report
2,500
Compliance report (a)
11,200
- Andersen
Preparation of financial report
2,500
In addition to the amounts described above, the entity received sponsorship
income for commercial events and advertising revenue from Ernst & Young of
$41,364 and Andersen of $18,936, and the entity paid expenses for rent and
tutoring services to Ernst & Young of $41,085 and $568 to Andersen for
tutoring services. All transactions were on normal arms length terms and
conditions.
(a) The compliance report was completed by Ernst & Young prior to the
integration with Andersen.
21
Notes to the Financial Statements for the year ended 30 June 2002
2002
2001
$
$
18. Finance lease commitments
2002
2001
$
$
21. Notes to the Statement of Cash Flows
Office furniture and equipment:
Not later than 1 year
Later than 1 year but not later than 2 years
-
93
-
(a) Reconciliation of cash
Minimum finance lease payments
Deduct future finance charges
-
93
-
Finance lease liabilities
-
93
Included in accounts as:
Interest-bearing liabilities
current (note 9)
-
93
-
93
For the purpose of the Statement of Cash Flows, cash includes cash on hand and
in banks and investments in money market instruments. Cash at the end of the
financial year as shown in the Statement of Cash Flows is reconciled to the
related items in the Statement of Financial Position as follows:
Cash
Short-term investments
445,653
7,421,128
1,123,954
4,352,152
7,866,781
5,476,106
(b) Reconciliation of net cash provided by operating activities to net profit
Net profit
Depreciation/amortisation of non-current assets
Gain/(loss) on sale of plant and equipment
19. Related party disclosures
The directors of the company during all of the past two financial years (except
as noted) were:
Ms Elizabeth Alexander AM FAICD
Mr Richard Warburton FAICD
Dr Kenneth Moss FAICD
Mr Don Mercer FAICD
Mr Graeme McGregor AO FAICD
Mr Clifford Breeze FAICD
Dr James Gill FAICD
Mr Robert Graham FAICD
Mr John Massey FAICD
Mr Alan Morrison FAICD
Mr Robert Nattey LVO FAICD
Mr Richard Ryan AO FAICD
Mr Valentine Roy Smith FAICD
Mr Gregory Swindon FAICD
Mr Charles Neville Bagot MAICD
Mr Maxwell James Green FAICD
Mr Peter John Mansell FAICD
Mr Robert Eyton Chaloner FAICD
Mr Andrew Frank Guy FAICD
Mr Gerald Norman Loughran FAICD
(appointed 25.11.1996)
(retired 30.10.2000)
(appointed 07.08.2000)
(appointed 04.12.2000)
(appointed 13.03.2000)
(retired 16.10.2001)
(retired 24.09.2001)
(retired 29.10.2001)
(appointed 30.10.2000)
(appointed 30.10.2000)
(retired 30.10.2000)
(retired 29.10.2001)
(retired 01.10.2001)
(retired 30.10.2000)
(appointed 29.10.2001)
(appointed 25.02.2002)
(appointed 27.09.2001)
(appointed 29.20.2001 /
retired 25.02.2002)
(appointed 16.10.2001)
(appointed 01.10.2001)
No director has personally received any financial benefit during the financial
year. Payments to any director-related entities are conducted on an arm’s length
basis in the normal course of business and on commercial terms and conditions.
The total amount paid during the financial year to a director-related entity
was $1,400.
20. Financial reporting by segments
The company’s activities include conducting educational activities, publication
of articles and statements of interest to directors, and consultation with and
submissions to government. The company operates in one geographical
location, being Australia.
Transfers to provisions:
Provision for employee entitlements
Rent-free equalisation
2,021,245
112,489
12,637
591,253
164,635
(429)
193,832
-
122,314
(8,290)
Net cash provided by operating activities before changes in net assets and
liabilities
2,340,203
869,483
Changes in net assets and liabilities
(Increase)/decrease in:
Current trade receivables
Current other receivables and prepayments
Current inventories
(65,081)
87,303
4,433
233,944
(112,807)
(38,080)
Increase/(decrease) in:
Current trade creditors
Other current creditors and accruals
Other provisions
327,201
65,538
(6,768)
21,713
699,124
-
2,752,829
1,673,377
22. Financial instruments
Terms and conditions of debtors
Australian Institute of Company Directors extends 30-day credit terms to
debtors generally, subject to compliance with the company credit policy.
Credit risk
Credit risk refers to the risk that a counterparty will default on its contractual
obligations resulting in financial loss to the company. The company has
adopted the policy of only dealing with creditworthy counterparties as
appropriately credentialed as a means of mitigating the risk of financial losses
from defaults.
The carrying amount of financial assets and liabilities as shown on the face of
the Statement of Financial Position represents the maximum credit risk to
which the company is exposed.
Net fair value
The carrying amount of the financial assets and liabilities as shown on the face
of the Statement of Financial Position represents the net fair value of the
financial assets and liabilities at the reporting date. All of these assets and
liabilities are of such a nature that they are not readily traded.
22
AICD Annual Report
Notes to the Financial Statements for the year ended 30 June 2002
Interest rate risk exposures
The following table summarises interest rate risk for the economic entity, together with effective interest rates as at balance date.
2002
Financial assets
Cash
Short-term bank deposits
Trade debtors
Floating
interest
rate (a)
$
Fixed interest rate maturing in
1 year or
Over 1 to
less
5 years
$
$
Noninterest
bearing
$
Total
$
Floating
%
3.70
Average interest rate
445,653
-
7,421,128
-
-
368,639
445,653
7,421,128
368,639
445,653
7,421,128
-
368,639
8,235,420
-
-
-
462,212
462,212
-
-
-
462,212
462,212
Fixed
%
5.07
Financial liabilities
Trade creditors
2001
Floating
interest
rate (a)
$
Fixed interest rate maturing in
1 year or
Over 1 to
less
5 years
$
$
Noninterest
bearing
$
Total
$
Floating
%
3.54
Average interest rate
Fixed
%
Financial assets
Cash
Short-term bank deposits
Trade debtors
1,123,954
-
4,352,152
-
-
303,558
1,123,954
4,352,152
303,558
1,123,954
4,352,152
-
303,558
5,779,664
-
93
-
135,011
-
135,011
93
-
93
-
135,011
135,104
5.21
Financial liabilities
Trade creditors
Finance lease liabilities
13.86
(a) Floating interest rates represent the most recently determined rate applicable to the instrument at balance date.
23. Employee entitlements
The number of full-time equivalents
employed as at 30 June are:
Aggregate employee entitlement liability
(Refer to Notes 10 &12)
2002
2001
63
51
602,110
408,278
24. Contingent liabilities
The company has a bank guarantee in respect of leased property to the amount of $260,000 (2001: $Nil) at year-end.
23
Directors’ Declaration
The directors declare that:
a) the financial statements and associated notes comply with the accounting standards and Urgent Issues Group
Consensus Views;
b) the financial statements and notes give a true and fair view of the financial position as at 30 June 2002 and
performance of the company for the year then ended;
c) in the directors’ opinion:
i) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become
due and payable; and
ii) the financial statements and notes are in accordance with the Corporations Act 2001, including sections 296 and
297.
Made in accordance with a resolution of the directors.
E A Alexander AM FAICD
National President
G W McGregor AO FAICD
National Treasurer
Melbourne, 12 September 2002
24
Sponsors
Australian Institute of Company
Directors sincerely thanks the
following companies for their
generous sponsorship of our State
divisions and the Company Directors
Conference 2002 during the past
financial year.
Australian Capital Territory
Division
Madew Wines
Minter Ellison Lawyers
Pacific Access Pty Ltd
PricewaterhouseCoopers
SMS Consulting Group
New South Wales Division
Allens Arthur Robinson
Aramis & Co
Australian Spirit Sailing
Company Pty Ltd
Aveda
Baltimore Technologies Pty Ltd
Bankers Trust
Becks
BT Funds Management Limited
Business Catalyst International
Pty Ltd
Cafe Sydney
Centre for Professional Development
Chief Marketing Officer Forum
Diners Club International
Four Seasons Hotel
Fuji Xerox Australia Pty Limited
Goss
Grapefoodwine Restaurant
Hazelton Airlines
Heinz Wattie’s Australasia
Heritage Fine Wines Pty Ltd
HSBC Bank Australia Limited
Hyatt Hotel Canberra
Hyatt Hotels & Resorts
IBM Australia Limited
J.A. Wales Printers Pty Ltd
Jaguar Racing
KPMG
Lilianfels Blue Mountains
Macquarie Marketing Group Pty Ltd
Minter Ellison Lawyers
Museum of Contemporary Art
National Gallery of Australia
Neostrata
90 East
Novell Pty Ltd
Oakvale Capital Ltd
Pacific Access Pty Ltd
PricewaterhouseCoopers
PRO:NED Australia Pty Ltd
Quay Bar Cafe
Recruitment Solutions
Sydney BridgeClimb
Sydney Glass Island Pty Ltd
TATA Consultancy Services
The Australian
The Jordan Templeman Group
The Ready Group
Thompson Legal Regulatory
TPI Asia Pacific
Trademark Events
Unity Development Pty Ltd
Vive Magazine
Queensland Division
Victoria Division
ABN AMRO Morgans
Alitek
Allens Arthur Robinson
BDO Kendalls
Blake Dawson Waldron
Competitive Dynamics
Corporate Renewal
Corrs Chambers Westgarth
Davidson Recruitment
Deacons
Diners Club International
Ernst & Young
Griffith University
Horwath Partnership
JP Morgan
Jupiters Limited
KPMG
Mercer Cullen Egan Dell
Metro Ford
Minter Ellison Lawyers
Peplin Biotech Ltd
PRD Realty
PricewaterhouseCoopers
QUT Faculty of Business
School of Management QUT
Stahmann Farms
Suncorp Metway Ltd
The Harrington Partnership
Allens Arthur Robinson
Andersen
Australian Corporate Governance
Berringer Blass
Boyden Global Executive Search
Chubb Insurance
Coin Advisory
Deacons
Deloitte Touche Tohmatsu
eTick Limited
Fuji Xerox
Gantz Wiley Asia Pacific
Grundig Dictation Machines Pty Ltd
InterBiz
IPI
KPMG
Macpherson & Kelley
Mallesons Stephen Jaques
Masterpiece
Melbourne IT
90 East
Novell
Oakvale Capital Limited
PRO:NED Australia Pty Ltd
Reddin Partners
Roy Morgan Research
St George Bank
TATA Consultancy Services
The Harrington Partnership
Unity Development Pty Ltd
Waite Group
Waite InterSearch
William M Mercer
Vintage Cellars
South Australia and Northern
Territory Division
Kronberger & Associates
- major annual sponsor
Right Management Consultants
Peters & Brownes Group
Plan B Financial Services Ltd
PricewaterhouseCoopers
Royal Automobile Club of WA (Inc)
Sons of Gwalia Ltd
TRUDO
United Group Limited
Water Corporation
Wesfarmers Limited
Western Australian Government
Railways
Western Power Corporation
Woodside Energy Ltd
Company Directors
Conference 2002
Corporate Partners
Blake Dawson Waldron
Diners Club International
Heidrick & Struggles
KPMG
Oracle Corporation Australia
Qantas Airways Limited
Supporting Partners
Audi Australia
BigStream Pty Limited
Heritage Fine Wines
J.A. Wales Printers Pty Ltd
Suncorp Metway Limited
Taylor Nelson Sofres
- gold sponsor
Coopers Brewery
Henry Walker Eltin
Woodstock Winery & Coterie
- silver sponsor
Andersen
Cridlands Lawyers (NT)
Defence Reserves Support Council
Deloitte Touche Tohmatsu (NT)
Department of Business, Industry,
and Resource Development (NT)
Ernst & Young
Finlaysons
Halliburton KBR
HomeStart Finance
KPMG
Optus (NT)
Piper Alderman
PricewaterhouseCoopers
The Teleran Group
Thomson Playford
Tasmania Division
Australia Post
Deloitte Touche Tohmatsu
Hotel Grand Chancellor
J Boag & Son
Searson Buck
Transend Networks
Western Australia Division
Alcoa World Alumina Australia
AlintaGas Limited
Allens Arthur Robinson
AlphaWest Pty Ltd
Andersen
Australia and New Zealand Banking
Group Limited
Australian Stock Exchange
Bank of Western Australia Ltd
Brambles Western Australia
Bristile Ltd
Burswood Limited
Clayton Utz
Clough Limited
Commonwealth Bank of Australia
Co-operative Bulk Handling Limited
Deloitte Touche Tohmatsu
Ernst & Young
Freehills
Hartleys
HBF Health Funds Inc
Henry Walker Eltin Contracting
Pty Ltd
Heytesbury Pty Ltd
Homestake Gold of Australia Limited
Jardine Lloyd Thompson Pty Ltd
JBWere
John Coombes and Company Pty Ltd
KPMG
Mallesons Stephen Jaques
Minter Ellison Lawyers
National Australia Bank Ltd
Norgard Clohessy
Paterson Ord Minnett
Pictured on the back cover from the top left
are staff members: Georgina Isbell,
Membership Executive and Kathryn Hudson,
Senior Membership Executive, both of the
NSW Division Office
Printed on recycled stock
25
Financial Report
AICD addresses
National Office
Tasmania
Level 25, Australia Square
264-278 George Street
Sydney NSW 2000
Telephone: 02 8248 6600
Facsimile: 02 8248 6633
[email protected]
Hobart
PO Box 1090
Sandy Bay Tas 7006
Telephone: 03 6224 0559
Facsimile: 03 6223 1468
[email protected]
Australian Captial Territory
Launceston
PO Box 83
Riverside Tas 7250
Telephone: 03 6327 2167
Facsimile: 03 6327 3277
[email protected]
Suite 5, 71 Constitution Avenue
Campbell ACT 2612
Telephone: 02 6248 5954
Facsimile: 02 6248 8409
[email protected]
Victoria
New South Wales
Level 25, Australia Square
264-278 George Street
Sydney NSW 2000
Telephone: 02 8248 6666
Facsimile: 02 8248 6677
[email protected]
200
1
Northern Territory
PO Box 482
Adelaide SA 5001
Telephone: 08 8999 5767
Facsimile: 08 8999 5730
[email protected]
PO Box 380
Collins Street West Vic 8007
Telephone: 03 9211 9255
Facsimile: 03 9211 9266
[email protected]
Western Australia
PO Box 7050
Cloisters Square WA 6850
Telephone: 08 9322 7400
Facsimile: 08 9322 6545
[email protected]
www.companydirectors.com.au
2002
Queensland
GPO Box 73
Brisbane Qld 4001
Telephone: 07 3221 4325
Facsimile: 07 3229 8443
[email protected]
South Australia
Level 2, 32 Grenfell Street
Adelaide SA 5000
Telephone: 08 8211 8001
Facsimile: 08 8211 8252
[email protected]