2004 - 2005 Annual Report - Tourism Australia

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2004 - 2005 Annual Report - Tourism Australia

Annual Report

2004/2005


26 September 2005

The Hon Fran Bailey MP

Minister for Small Business and Tourism

Parliament House

CANBERRA ACT 2600

Dear Minister,

I have pleasure in presenting the first annual report of Tourism Australia for

the reporting period of 1 July 2004 to 30 June 2005 in accordance with clause

39 of the Tourism Australia Act 1994 and section 9 of the Commonwealth

Authorities and Companies Act 1997.

Yours sincerely,

The Hon Tim Fischer AC

Chairman

Tourism Australia

P.S. It has been a dynamic first year for Tourism

Australia, laying a solid foundation towards further

boosting tourism spread and spend. The weights are on

to ensure this now happens.

1


Contents

Chairman’s report 5

Managing Director’s report 6

Highlights 20042005 8

Tourism Australia … the story so far 11

Principles 13

Objectives and outcomes 20042005 14

Corporate governance 17

Organisational structure 18

Directors of Tourism Australia 22

Ecologically sustainable development and environmental performance 23

REPORT OF OPERATIONS

Corporate Services 26

Strategy and Research 30

Corporate Affairs 34

Marketing 36

Australasia 42

International 48

INTERNATIONAL MARKETS

Contact officer

For more information about this annual report, please contact:

General Manager, Corporate Affairs

Tourism Australia

GPO Box 2721

Sydney NSW 1006

Internet

You can access this report online at www.tourism.australia.com

Additional information sources

2004-2005 Portfolio Budget Statements

2004-2005 Portfolio Additional Estimates Statements

Tourism Australia Annual Operating Plan 2004/05

Tourism Australian Corporate Plan 2005/06 – 2007/08

Freedom of Information

Tourism Australia is a prescribed authority under the Freedom of Information Act 1982.

No FOI requests were received by Tourism Australia during the review period.

The contact officer for FOI requests from Tourism Australia is:

John Hopwood

Director, Corporate Services

Tourism Australia

© Commonwealth of Australia 2005

This work is copyright. Apart from any use as permitted under the Copyright Act 1968, no part may be reproduced by

any process without prior written permission from the Commonwealth. Requests and inquiries concerning reproduction

and rights should be addressed to the Commonwealth Copyright Administration, Attorney General’s Department,

Robert Garran Offices, National Circuit, Barton ACT 2600 or posted at http://www.ag.gov.au/cca

The Americas

Canada 54

United States 55

Asia

China 56

Hong Kong 58

India 59

Korea 60

Malaysia 61

Singapore 62

Taiwan 63

Thailand 63

Japan 64

Gulf Countries 66

New Zealand 67

UK & Europe

France 68

Germany/Switzerland 69

Italy 70

Nordic & Netherlands 71

UK & Ireland 72

2 3


Chairman’s report

FINANCIAL REPORT

Independent Audit Report 76

Statement by Directors 78

Statement of Financial Performance 79

Statement of Financial Position 80

Statement of Cash Flows 81

Schedule of Commitments 82

Schedule of Contingencies 83

Notes to and forming part of the financial statements 84

Glossary 113

Tourism Australia Overseas Offices 114

Index 115

Tourism Australia (TA) is now one year old, successfully blending all of the

cultures and activities that now form our new organisation.

I congratulate the people of TA for maintaining momentum during these

changes and for successfully managing the transition to the new organisation,

and the physical movement of the HQ from William Street to Sussex Street

in Sydney’s CBD. The passion and dedication displayed by TA staff in Sydney,

Canberra and around the world is a credit to the country they represent.

The new combined capability of TA, coupled with initiatives and increased

funding resulting from the Tourism White Paper, sets a solid foundation for

tourism growth.

The Australian Government has made an unprecedented level of investment in

the Australian tourism industry and TA is leveraging that support to maximise

the impact of the many international and domestic marketing activities.

By harnessing all of these new capabilities, TA is developing a more sustainable

tourism industry.

A more profitable industry is the key to a more sustainable industry

and the insights and assistance provided by TA to the tourism industry

will help increase the international and domestic demand for Australian

tourism experiences.

Tourism currently employs more than 500,000 Australians and TA is working

hard to ensure that those jobs are secured for today and continue to grow in

the future.

Tourism Australia’s clear purpose is to increase the economic benefits to

Australia from tourism by increasing total visitor spend and dispersal of that

spend across Australia, thereby creating more jobs for Australians.

I’d like to thank my fellow Directors for their support throughout the year,

including outgoing Director Gerry Harvey and also welcome Peter Burnett as

our newest member.

The Board has made a conscious effort to disperse more and gain a greater

understanding of Australian tourism to deliver an enhanced representation

to the tourism industry. The Board has met in a variety of locations around

Australia during the year, visiting Hobart, Alice Springs, Sydney and more

recently held a meeting while travelling across the Nullabor.

Tim Fischer

Chairman

4 5


Managing Director’s report

Tourism Australia (TA) is a leverage marketing organisation that has adopted

the vision to become and remain the best National Tourism Organisation

(NTO) on the planet.

To be the best NTO, we must become the world leader in stimulating

sustainable demand for Australian tourism experiences. By performing this

role, we must be valued as an organisation that delivers economic benefits

for Australia, in particular regional areas, by increasing the total spend of our

international and domestic visitors and ensuring the dispersal of that spend

across Australia.

Our first year of operations has been all about getting our strategy right

and putting in place the key building blocks for successful operations in

the years ahead.

To this end, TA’s Corporate Plan for 2005/06 to 2007/08 was released at

ATE2005 in Perth in June. The plan, referred to by industry as TA’s ‘experience

strategy’, sets out a clear role, goal, set of challenges and strategy for the next

three years.

The plan is focused on maximising our competitiveness, identifying clear

targets, leveraging our great strengths as a destination and driving consumers

to a deeper appreciation of the experiences Australia has to offer and how

these experiences deliver on their needs.

The plan also sets ambitious new growth targets for the tourism industry to

help Tourism Australia and the industry align and focus our efforts.

Overall, our marketing challenge is to shift international consumers from a

passive preference to visit Australia to an active intention to visit Australia

within the next 12 months, that can then be converted by the industry into

actual bookings. We often say that while it is great for Australia to be loved by

the world (as survey after survey confirms), it is much better to be visited by

those who love you.

We will achieve this objective through leverage partnerships, compelling

communications, strong research and insights as well as the focused

application of our resources to where we can derive the greatest benefits

from our marketing.

TA is already championing a clear destination marketing strategy and

articulating and promoting a compelling tourism destination brand. However,

recognising the need to go further, we have recently appointed M&C Saatchi

and Carat as our global agency partners to take our campaigns forward.

We are applying ourselves in our key markets around the world, from the

fast-growing China market, which will account for one third of our forecast

growth to reach our targets, to our traditional Western markets of the US, UK,

New Zealand and Germany. We are dealing with the opportunities of rapid

new growth in South Korea and working closely with our industry partners

to address the very significant challenges we face in Japan. Together our top

seven markets deliver approximately two thirds of total international visitor

spend for Australia, and will account for 75 per cent of the growth in spend in

our targets. Accordingly they receive the ‘lion’s share’ of our resource attention.

Further afield, we are continuing our commitment to the strong dispersal

markets of continental Europe, which has been assisted by our new

Destination Australia Partnership arrangements with State and Territory tourism offices, based in London. We

are consolidating past growth in markets such as Singapore and Hong Kong, and taking new opportunities in

markets such as India and the Gulf Countries.

TA began to tackle the challenge of a flat domestic market with the ‘All The Space You Need’ campaign,

demonstrating to Australians that Australia could meet their holiday needs more than they realised. More

recently TA has been exploring ways to unlock the size of the overall domestic market and increase the amount

of leave taken by Australians.

With a new mandate to address supply side issues, TA has been supporting the development of unique

Australian tourism experiences through the work of the Australian Experiences Team (formerly niche

marketing) and in particular through the establishment of Indigenous Tourism Australia to promote the

development of key tourism segments. Ecotourism and Food and Wine have also been singled out for attention,

while continuing to drive our backpacker and business tourism markets remain a priority.

A great opportunity to highlight new experiences and promote dispersal was holding ATE in Perth for the first

time. ATE2005 was a resounding success with around 2,000 Australian delegates from 900 companies meeting

with up to 700 key overseas buyers from 50 countries. Delegate satisfaction with the event returned to record

levels as measured in our post- ATE delegate surveys.

TA is also helping the industry by gathering and communicating reliable market intelligence and insights

for improved decision-making not only through the work of Tourism Research Australia but in our consumer

research through segmentation studies and work on targeting our global ideal visitor.

Finally, TA has embarked on an ambitious partnerships program to extend our influence, most significantly

demonstrated by the announcement of our new three year $60 million partnership with Qantas.

The ambitious goals and strategies of the Corporate Plan, and our activities of the past year reflect the

enhanced capabilities made possible by the strong commitment of the Australian Government through

the Tourism White Paper, released in November 2003. The White Paper led to the establishment of Tourism

Australia, and it guides our resources and our strategies going forward.

TA is staffed by great and talented people who are passionate about promoting Australia as a tourism

destination. In the past year they have dealt with significant structural change. The success of the organisation

in getting established is a tribute to their professionalism. Our thanks also to the new Tourism Australia

Board, especially our dynamic and highly committed Chairman, Hon Tim Fischer, as they work closely with

management to ensure the organisation delivers on the key requirements set by our principal stakeholder, the

Australian Government, and the expectations of the tourism sector.

Finally, TA is grateful for the generous support of the Australian Government, in particular through the

combined efforts of the Hon Ian Macfarlane MP, Minister for Industry, Tourism and Resources; the Hon Fran

Bailey MP, Minister for Small Business and Tourism; and the Hon Warren Entsch MP, Parliamentary Secretary

to the Minister for Industry, Tourism, and Resources. We also appreciate the Government’s broader support

through the Friends of Tourism group, led by the Hon Bruce Baird MP.

There is no doubt that the next three years will be challenging, however the opportunities to create jobs for

Australians though tourism and the activities of TA are significant. TA looks forward to working with all our

partners and stakeholders to make this happen.

Scott Morrison

Managing Director

6 7


Highlights 20042005

AWARDS AND SUPPORT

Tourism Australia’s Brand campaign picked up two Gold Awards from Pacific

Asia Travel Association (PATA) and won the ‘Best NTO in the Korean tourism

industry’ award. Australia was voted dream destination in an American Express

survey in London.

Australia was voted ‘favourite country’ in a survey of over 15,000 holidaymakers

from the UK and was named the world’s number one tourism brand

by the Anholt-GMI Nation Brands Index (NBI).

GLOBAL AGENCY

Tourism Australia (TA) is looking forward to working with our global partners

M&C Saatchi and Carat over the next three years to evolve and deliver

the tourism campaign that Australia as a destination deserves, that our

stakeholders from the Australian Government have invested in and that the

tourism industry can get behind and make a great success.

LEVERAGE PARTNERSHIPS

Tourism Australia and Qantas will embark on a new three-year global

destination marketing partnership for Australia from 1 July worth more

than $60 million.

TA’s $US20 million partnership with American Express has contributed to a 200

per cent increase in Amex card usage in Australia and the number of American

Express cardholders visiting Australia has increased by 13 per cent.

An exciting new partnership campaign between TA and Visa International,

launched in China, is targeting higher yield tourists from Australia’s fastest

growing market, including 550,000 Visa Gold Card and Platinum Card holders

in Beijing, Shanghai, Guangzhou and Shenzhen.

AUSTRALIAN EXPERIENCES

TA announced the formation of Indigenous Tourism Australia (ITA) with Aden

Ridgeway as the inaugural Executive Chairman.

TA is required by the Tourism Australia Act 2004 to help market and develop

niche segments in the Australian tourism industry. TA now has a dedicated

team, the Australian Experiences Market Development unit, in place to

implement the Australian Experiences strategy.

TOURISM EVENTS AUSTRALIA

In recognition of the value and importance of the business and major event

industries, TA’s new Tourism Events Australia (TEA) division focuses on

marketing Australia as a business and major events destination. TA also runs

a number of world-class events, such as Dreamtime and partners with the

industry (TEAM Australia – the Convention Bureaux) to run in market events

such as TABEE, which held its first event in the US in January.

To help attract Amway Korea to Australia in 2006, TA involved key tourism

representatives, including the convention bureaux and decision-makers in

activities through Team Australia Business Events.

TRADE EVENTS

Tourism Australia recently held the highly successful Australian Tourism

Exchange ( ATE) in June, where more than 2,000 buyers and sellers of

Australian tourism product from over 50 countries met in Perth.

INTERNATIONAL ACTIVITY

The new Brand Australia campaign, ‘Australia. A Different Light’,

has now been launched in New Zealand, the United States, Canada,

Malaysia, France, Germany, Hong Kong and China, Japan and Korea.

The Destination Australia Partnership (DAP) in UK/ Europe is now

fully established and has exceeded targets for year one. TA’s Youth

Campaign has been finalised for the UK, with an incredible 122,467

responses. TA has promoted the new benefits of the Working Holiday

Maker scheme and been supportive of M2006 with major promotions

in London and promoted the Queen’s Baton Relay.

Under the new administrative arrangements for China’s Approved

Destination Status (ADS) scheme, all current ADS agents will be required

to re-apply for approval along with new applicants. These applications

will be rigorously screened and approved operators will need to comply

with a new ADS Code of Business Standards and Ethics, which carries

penalties including suspension and expulsion from the scheme.

The $US6.1 million American campaign, which has eclipsed the Paul

Hogan campaign, was timed to coincide with the PR-rich G’Day LA:

Australia Week with a co-operative campaign with Qantas promoting

the Aussie Airpass as the ideal vehicle to explore Australia.

The new $AUD8 million campaign in Japan put Australia back on TV

screens for the first time in seven years and featured the Delta Goodrem

television commercial (TVC), strong co-operative campaigns with Japan

Airlines and Qantas, online, wireless (mobile phones), print and outdoor

executions, including prominent subway advertising.

TA’s new $AUD2 million campaign in Korea, the Best of Australia, is a

tactical campaign with Cathay Pacific that focuses sharply on destination

experiences and brings together print, TVC, magazine and online.

Tourism Australia plans to expand operations in Canada by opening

an office in Toronto and TA will re-launch its highly successful Aussie

Specialist Program in New Zealand in September 2005.

Key achievements under the Tourism Australia/Austrade

Memorandum of Understanding (MOU) in 2004/05 include: an

Australian tourism ‘toolkit’ for 123 Austrade offices; a consumer

brochure in Spanish, Portuguese and Russian; 47 new agencies in

non-priority markets were identified and attended ATE; joint

promotions were held in Moscow, Malta, Vietnam, and Mexico;

and an australia.com Spanish version was launched for the Latin

American markets.

8 9


Tourism Australia … the story so far

VISITING JOURNALISTS PROGRAM

The Visiting Journalists Program ( VJP) continued to deliver measurable

results for international promotional activity. TA hosted some 802

international print and broadcast journalists in Australia during

the year, generating editorial coverage with a value in excess of

$AUD483 million. Print and broadcast coverage reached over four

billion people worldwide.

FINANCIAL SUMMARY

Tourism Australia’s total revenue for the 2004/05 year was $AUD169.8

million. Revenue from the Australian Government totalled $AUD138.4

million and revenue from co-operative industry activities and other

sources totalled $AUD31.4 million.

CORPORATE SERVICES

TA has developed and implemented a new procurement manual and

developed a new HR strategy.

DOMESTIC CAMPAIGN

TA began to tackle the challenge of a flat domestic market with the

more rational ‘All The Space You Need’ campaign to ensure that Australia

is more in the consideration set of preferred holiday destinations.

More recently TA has been exploring ways to unlock the size of the

overall domestic market and increase the amount of holiday leave

taken by Australians through a more causal campaign.

RESEARCH

The White Paper provided $AUD21.5 million over four years for

expansion of tourism research and statistics. The Australian Bureau

of Statistics (ABS) was funded to produce the Australian Tourism

Satellite Account for 2003-04 and expanded the Survey of Tourist

Accommodation.

Destination Surveys are underway and Decipher was successfully

launched with the website commencing operation in February, fully

supported by Tourism Research Australia (TRA) data sources.

TRA expanded the sample size of both the NVS and IVS to provide

more meaningful regional and small area tourism information

and introduced an enhanced forecasting methodology to provide

improved expenditure based forecasts. The Tourism Forecasting

Council (TFC) has developed forecasts for inbound tourism’s

contribution to the economy.

TA is undertaking major segmentation studies in all key markets and

TRA is implementing an improved dissemination strategy through the

deployment of web-based technology.

The establishment of Tourism Australia (TA) was a key recommendation of the

Australian Government’s Tourism White Paper. This is the first Annual Report

for the new organisation.

TA was established on July 1 2004 and brings together the functions of

international tourism marketing (formerly the Australian Tourist Commission),

domestic tourism marketing (formerly See Australia) and tourism research

(formerly the Bureau of Tourism Research and Tourism Forecasting Council)

under one body.

The Tourism White Paper was an Australian Government tourism initiative,

designed to achieve industry growth and provide greater synergy across all

areas. It provided the framework for structural change to more effectively

support Australia’s tourism industry.

TA is fostering the development of a more sustainable industry that will

deliver greater economic benefit to the Australian community by tackling the

structural challenges facing the industry and helping the industry become

more resilient and less susceptible to external shocks.

Tourism Australia’s clear purpose is to increase the economic benefits to

Australia from tourism and generate more jobs for Australians.

Increasing the total spend of our visitors and the dispersal of the spend across

Australia will help develop a more sustainable industry. Tourism currently

employs more than 500,000 Australians and TA is working with the industry to

ensure that those jobs are secured for today and grow in the future.

To grow the amount of spend generated from our tourism markets, Australia

needs to target the ideal visitor wherever they are in the world and to focus on

delivering high quality and unique Australian experiences. We need to ensure

we preserve the value of these experiences in the market place and compete

on our strengths as a quality and valued, high experience destination.

Our new Corporate Plan clearly sets out how TA aims to encourage growth and

dispersal in total visitor spend with a comprehensive game plan that:

> targets a global ideal visitor – those who spend more and are more highly

predisposed to what Australia has to offer;

> requires us to stand out from the crowd with compelling global marketing

communications that sets a new standard in destination promotion;

> focuses on shifting our consumer from not just loving Australia but to

actually intending to visit;

> leverages our competitive advantages as a destination in an increasingly

competitive destination market place;

> employs cutting edge insights into the market to enable us to find and

communicate more effectively with our target ideal visitor;

> demands strong partnerships with media, trade and industry that can

amplify our marketing efforts and give Australia a much greater share

of voice; and

> applies strong disciplines to applying our resources across our international

markets to ensure we get the greatest economic return for Australia.

10 11


Principles

Through the implementation of these strategies, Tourism Australia

is increasing the international and domestic demand for Australian

tourism experiences.

The continued development and promotion of ‘ Australian Experiences’

– previously known as ‘ niche’ tourism products – will help present a more

compelling Australia to the global visitor. TA now has a dedicated team, the

Australian Experiences Market Development unit, in place to implement the

Australian Experiences strategy.

Consumers are becoming more demanding. They have a voracious appetite

for what’s new, so Australia has to maintain a ‘freshness’ of what we offer to

remain competitive and appealing as a destination.

Tourism Australia has prioritised its effort around consumer desires and each

segment’s ability to deliver on expenditure and dispersal goals. TA will focus

on the priority experience segments of:

1. Indigenous, ecotourism and nature;

2. Caravan and camping, food and wine, backpacking, study tourism; and

3. Other niches serviced through the Niche Tourism Toolkit e.g. cruise, rail,

accessibility, cycling etc.

These unique Australian experiences present to our ideal visitors from around

the world tourism opportunities that they will find compelling enough to

inspire them to book a trip to Australia.

Reflecting new possibilities and the industry’s enhanced capability, Tourism

Australia has set ambitious new yield targets for the tourism industry. The

targets are contained in TA’s Corporate Plan 2005/06-2007/08 and establish

the goal of reaching $22.1 billion in international visitor spend by 2007/2008

– an increase of more than 25 per cent on the figures achieved in 2003/2004.

The new targets are over and above the forecasts made by the Tourism

Forecasting Committee of $21.2 billion and are designed to provide a focus for

TA’s engagement with the tourism industry to increase the economic dividend

from tourism as their primary objective.

To achieve these new targets and to achieve the vision of becoming and

remaining the best National Tourism Organisation on the planet, TA is

developing a more sustainable Australian tourism industry. The new TA

provides greater operating scope and opportunities, including an increased

international marketing effort, increased development of and focus on

regional tourism, increased research capability, development of niche markets

and unique Australian experiences and a greater focus on business tourism

and major events.

OUR ROLE

TA’s role is to stimulate sustainable international

and domestic demand for Australian tourism

experiences, by:

> influencing the actions of others through our

interaction in the tourism and travel marketing

matrix, by:

• championing a clear destination marketing strategy;

• articulating and promoting a compelling tourism

destination brand;

• facilitating sales by engaging and supporting the

distribution network;

• identifying and supporting the development of

unique Australian tourism experiences;

• gathering and communicating reliable market

intelligence and insights for improved decisionmaking;

and

• working with partners who can extend

TA’s influence.

OUR GOAL

TA’s goal is to become and remain the best National Tourism Organisation on the planet by maximising tourism

visitor spend within Australia and ensuring that spend is dispersed far and wide, delivering real economic

benefits for regional Australia and our major cities.

To focus industry marketing activity, TA has established the following industry targets to be achieved

by 2007/08:

MARKETS

ACTUAL

2003/04

TFC FORECAST

2007/08

Sustainable

FORECAST

GROWTH

Economic

Sustainable

GROWTH TARGET

2007/08

TARGET

GROWTH

Domestic* $16.0 bn $16.4 bn $0.4 bn $16.8 bn $0.8 bn

International $17.6bn $21.2 bn $3.6 bn $22.1 bn $4.5 bn

TOTAL $33.7 bn $37.6 bn $4.0 bn $38.9 bn $5.3 bn

The Tourism Forecasting Committee (TFC) forecasts included consideration of marketing effectiveness and

imply growth of $4.0 billion in tourist spending after inflation across these four years. Beyond this forecast TA

has a target goal for the industry of an additional $1.3 billion in combined real domestic interstate leisure and

international visitor spend. Domestic and international visitor spend targets are measured by the Real Inbound

and Domestic Economic Value derived from the International and National Visitor Surveys.

* The objective of TA in domestic tourism is to increase interstate holiday + visiting friends and relative (or leisure) spend.

Forecasts for domestic interstate leisure spending used TFC forecast growth rates for domestic leisure visitor nights.

Social

Growth

in total

visitor spend

(total and

average per stay)

Jobs

growth

Environmental

Growth in

dispersal –

regional visitor

spend (outside the

major gateways)

Sustainable

Increase international and domestic visitation

(number of visitors, length of stay,

spend per person, spend per day)

12 13


Objectives and outcomes 20042005

OBJECTIVES PERFORMANCE INDICATORS OUTCOMES

OBJECTIVES PERFORMANCE INDICATORS OUTCOMES

Increase international visitors

from key markets and target

segments travelling to and

within Australia.

Influence a larger percentage

of the Australian population

to travel within Australia.

> Consumer brand tracking. > Australia continues to rate highly in terms

of ‘brand health’ and is a highly desirable

destination in all key tourism markets.

> Australia received a number of international

awards recognising the strength of its

tourism brand.

> Increase desire of the

international consumer

to visit Australia by

converting the desire to

visit Australia into reality.

> Improve the tourism

industry’s ability to act

on market/consumer

opportunities.

> Increasing domestic visitor

expenditure in Australia.

> Promoting Australia as a

destination for Australians

> There were 5.4 million visitor arrivals for the

financial year 2004-05, an increase of seven

per cent relative to the previous financial year.

> Australia remains a preferred destination for

key markets.

> Visitors from Korea for the six months to

June 2005 increased 24 per cent relative to

the same period of the previous year.

> Visitors from the United States for the

six months to June 2005 increased six per

cent relative to the same period of the

previous year.

> Provided research and tools for monitoring

and analysing key areas including aviation

and customer segmentation.

> The 2005 North American Conversion Study

provided valuable insight into consumer

behaviour resulting from Tourism Australia’s

co-operative marketing in North America.

> Domestic travellers accounted for over four

fifths of the total expenditure in Australia,

spending $51.1 billion.

> Between 1999 and 2004, domestic overnight

visitor expenditure increased at an average

annual rate of 3.5 per cent.

> The national ‘All The Space You Need’

campaign increased the consideration of

Australia as a holiday destination.

> The highly successful continuing campaign

reached up to 90 per cent of the target

audience through television (free and pay),

cinema, newspapers, magazines, on-line and

direct marketing.

Convince distributors of the

profit potential of Australia

as a destination

Foster a more sustainable

tourism industry in Australia

> Sales performance of

key distributors (Aussie

Specialist Agents)

> Maximise the

competitiveness of

Australia as a destination

> Enhance adoption

of ecotourism and

sustainability agendas in

overall tourism promotion

> Aussie Specialist Program was relaunched in

January 2005, featuring a more interactive

website with new tools for agents.

> Across Asia there are in excess of 2,000

Aussie Specialists in our key markets.

> In May 2005, there were 3,455 agents

qualified as Aussie Specialists in the UK

and Europe.

> In May 2005, there were 4,602 Aussie

Specialist trading partners and 130 Premier

Agents in North America.

> Tourism Australia’s Visiting Journalists

Program brought close to 1,000 print and

broadcast journalists to Australia.

> For example, journalists from a range of

publications across Asia visited Australia in

May 2005 to experience some of Australia’s

best fashion, food and film.

> Around 2,000 delegates to ATE 2005 were

provided with the opportunity to meet

approximately 700 key overseas buyers

from 50 countries.

> Worked co-operatively with the

Department of Industry, Tourism and

Resources to implement White Paper

initiatives including the Tourism and

Conservation Partnerships initiative.

> The trade oriented, Japanese language

website featuring Australian eco products

was updated in June 2005.

> Information on ecotourism and

sustainable tourism initiatives has been

made available on both australia.com and

tourism.australia.com

14 15


Corporate governance

OBJECTIVES PERFORMANCE INDICATORS OUTCOMES

Establish Tourism Australia

as a professional, highlymotivated,

efficient and

strategically-focused business

> Continuously improve

internal and external

stakeholder management

through effective leverage

partnerships

> Continued to improve and enhance

partnerships with industry partners, state,

territory and regional tourism organisations,

consumers and all levels of government.

> Entered a three-year partnership with AMEX,

which has already targeted over two million

cardholders and resulted in 6,000 inquiries.

> Launched ‘ Visa prefers Australia’ campaign in

conjunction with Visa in China.

> Finalised a new three-year global destination

marketing partnership with Qantas for

Australia from 1 July 2005 worth more than

$60 million.

> Provided high-quality market intelligence,

insights and co-operative marketing

opportunities to industry.

> Prepared media releases promoting

Tourism Australia and achievements in key

areas generating awareness and publicity

amongst industry, consumers and all levels

of government.

THE BOARD OF DIRECTORS

TA is governed by a 10-member Board of Directors, which reports to the Minister for Small Business

and Tourism.

The role of the TA Board defined by the Tourism Australia Act 2004, is to:

> ensure the proper and efficient performance of Tourism Australia’s functions; and

> determine Tourism Australia’s policy in relation to any matter.

The TA Board is responsible for a governance framework to ensure that its statutory mandates are achieved.

As a public sector agency, TA must be conversant with the general policies of the government of the day, as well

as be informed about key Ministerial directions, and Commonwealth guidelines on major initiatives that relate

to the organisation.

DIRECTORS OF TOURISM AUSTRALIA AS AT 30 JUNE 2005

The Hon Mr Tim Fischer AC Chairman

Mr Tony Clark AM

Deputy Chairman

Mr Scott Morrison Managing Director

Mr Gerry Harvey

Director

Ms Valerie Davies

Director

Ms Jane Jeffreys

Director

Mr Wayne Kirkpatrick

Director

Mr Andrew Burnes

Director

Ms Karen Jacobs

Director

Mr Mark Paterson

Government Member

Ms Patricia Kelly

Alternate Government Member

THE CHAIRMAN

The Chairman and the Managing Director are separate appointments to ensure appropriate accountability

and greater capacity of the Board for independent decision-making. The Chairman ensures that sufficient

Board meetings are held to enable it to perform its duties responsibly; that appropriate agenda items

are placed before the Board; and exercises control over the quality, quantity and timeliness of the flow of

information between management and the Board. The Chairman is also responsible for the conduct of

meetings of the Board.

16 17


ORGANISATIONAL STRUCTURE

Minister for Small Business and Tourism

The Hon Fran Bailey

BOARD

Chairman

The Hon Tim Fischer AC

BOARD MEETINGS

The Board scheduled seven meetings during the year.

The regular Board papers make Directors aware of current and forthcoming issues relevant to the organisation’s

operations and performance. These papers contain the year-to-date financial performance of all business

groups (compared to budget), a report from the Managing Director relating to the operations of the

organisation, proposals for significant contracts and papers relating to particular issues. Senior management

also present significant matters to the Board.

PERSONAL AND CORPORATE INTEGRITY

All directors and employees are expected to act with the utmost integrity and objectivity, striving at all times to

enhance the reputation and performance of TA.

The TA Board subscribes to the code of conduct based on principles recommended by the Australian Institute of

Company Directors. The code specifies values and behaviours in the areas of fairness, equity, lawful obedience,

honesty, openness, respect, loyalty, integrity, protective care, efficiency, personal development and leadership

with which all employees have a responsibility to comply.

TA has developed and implemented a code of conduct for its employees which is consistent with these values

and behaviours.

Separate policies exist covering discrimination, employment, harassment, health and safety and other business

practices such as email usage, fraud control and security.

Deputy

Chairman

Tony Clark AM

Director

Gerry Harvey

Director

Valerie Davies

Director

Jane Jeffreys

Director

Wayne

Kirkpatrick

Director Director

Andrew Burnes Karen Jacobs

Government

Member

Mark Paterson

CONFLICTS OF INTEREST

The Board has in place a policy and procedures for the disclosure and resolution of any matter which may give

rise to actual or potential conflicts between the interests of a Director and those of the organisation.

RISK MANAGEMENT

The Board adopts practices designed to identify significant areas of business risk and to effectively manage

those risks in accordance with the company’s risk profile.

Director,

International

Richard Beere

> Asia

> Americas

> Japan

> Gulf Countries

> UK/ Europe

> International

Operations

Director,

Research & Strategy

Geoff Buckley

> Tourism Research

Australia

> Market Research

and Insights

> Strategy and Planning

> Aviation and Analysis

Director,

Marketing

Ian Macfarlane

> Brand Australia

> International Media

> e-Strategy

> Tourism Events

Australia

Managing Director

Scott Morrison

Director,

Corporate Services

John Hopwood

> Risk and

Administration

> Finance

> Human Resources

> Technology

> Corporate Governance

Director,

Australasia

Andrew McEvoy

> Australia

> New Zealand

> Partnership Marketing

> Australian Experiences

> Trade Events

General Manager,

Corporate Affairs

Sasha Grebe

> Corporate Affairs

> Government Relations

> Industry

Communications

> Internal

Communications

BOARD SUB-COMMITTEES

The Board carries out certain of its duties through Board committees. These committees meet regularly and

make recommendations to the Board on issues delegated to them. The committees operate under terms of

reference approved by the Board.

Audit Committee:

This committee ensures that an effective internal control framework exists across TA. This includes internal

controls to deal with both the effectiveness and efficiency of significant business processes. The committee also

reviews risk management controls and end of year financial statements.

Human Resources Committee:

This committee oversees the organisation’s human resources principles, practices and programs with regard to

employee terms and conditions, management development, equal employment opportunity and remuneration.

18 19


RECORD OF BOARD MEMBERS AND ATTENDANCE

RECORD OF BOARD COMMITTEES 2004/05

The Board met seven times during the year in Sydney, Alice Springs and Hobart and had an aggregate

attendance of directors of 99 per cent.

Board members also represented TA at both industry and general forums.

COMMITTEE

MEMBERS

AUDIT COMMITTEE

POSITION

ATTENDANCE

HUMAN RESOURCES

COMMITTEE

POSITION

ATTENDANCE

MEMBER

Hon Tim Fischer

Chairman

Mr Tony Clark

Deputy Chairman

Mr Scott Morrison

Managing Director

Mr Ken Boundy

Acting Managing Director

Mr Andrew Burnes

Director

Mr Wayne Kirkpatrick

Director

Mr Gerry Harvey

Director

Ms Karen Jacobs

Director

Ms Jane Jeffreys

Director

Ms Valerie Davies

Director

Mr Mark Paterson

Government member

Ms Patricia Kelly

Alt Government member

DATE OF APPOINTMENT/

REAPPOINTMENT

EXPIRY OF

APPOINTMENT

BOARD MEETINGS

ATTENDANCE

1 July 2004 30 June 2007 7

1 July 2004 30 June 2005 7

13 December 2004 At Board’s pleasure 3

1 July 2004 10 December 2004 4

1 July 2004 30 June 2007 7

1 July 2004 30 June 2005 7

1 July 2004 30 June 2005 6

1 July 2004 30 June 2005 7

1 July 2004 30 June 2005 7

1 July 2004 30 June 2005 7

1 July 2004 30 June 2007 4

1 July 2004 30 June 2007 3

Tony Clark Chairman 4

Wayne Kirkpatrick Member 4

Gerry Harvey Member 4

Andrew Burnes Chairman 5

Karen Jacobs Member 5

Jane Jeffreys Member 5

Valerie Davies Member 5

Note: All Board members with a 30 June 2005 expiry date, with the exception of Mr Gerry Harvey, were re-appointed for a further term.

20 21


Directors of Tourism Australia

The Hon Mr Tim Fischer AC, Chairman

Appointed to the Board in July 2004

Mr Tony Clark AM, Deputy Chairman

Appointed to the Board in July 2004

Mr Scott Morrison, Managing Director

Appointed Managing Director in December 2004

Mr Gerry Harvey, Director

Appointed to the Board in July 2004

Appointment current to 30 June 2005

Ms Valerie Davies, Director

Appointed to the Board in July 2004

Ms Jane Jeffreys, Director

Appointed to the Board in July 2004

Mr Wayne Kirkpatrick, Director

Appointed to the Board in July 2004

Mr Andrew Burnes, Director

Appointed to the Board in July 2004

Ms Karen Jacobs, Director

Appointed to the Board in July 2004

Mr Mark Paterson, Government Member

Appointed to the Board in July 2004

Ms Patricia Kelly, Alternate Government Member

Appointed to the Board in July 2004

Ecologically sustainable development

and environmental performance

Tourism Australia has a statutory obligation under the Tourism Australia

Act 2004 to help foster a sustainable tourism industry in Australia. Working

together with the Department of Industry, Tourism and Resources, the

Department of the Environment and Heritage, State Tourism Organisations

and industry partners, Tourism Australia seeks to fulfil this commitment and

help to ensure the responsible development and promotion of Australia’s

tourism industry.

Tourism Australia is:

> developing beneficial partnerships, which contribute to the long-term

environmental, social and economic sustainability of the tourism industry;

> developing a reliable knowledge base to enable effective decision-making

processes, which integrate both long-term and short-term economic,

environmental and social considerations;

> creating a sustainable tourism focus for Tourism Australia

marketing activities;

> creating a high profile for best practice sustainable tourism product; and

> working to continuously improve Tourism Australia’s corporate

environmental performance.

22 23


REPORT OF OPERATIONS


Corporate Services

OVERVIEW

The role of Corporate Services is to supply Finance, Administration, Risk Management, Human Resources,

Technology and Board secretarial services to Tourism Australia.

FINANCE

The Sydney Finance unit provides professional services for the total finance functions of Tourism Australia. The

unit develops strategies and maintains operations for financial systems, budgeting, tax reporting and treasury

operations and supports the regional Corporate Services Managers.

Highlights and results

> A key responsibility for the unit was the accounting for the organisation’s financials. Tourism Australia’s

expenditure for the year was $AUD165.5 million.

> Government revenue was $AUD138.4 million and revenue from co-operative industry activities and other

sources reached $AUD31.4 million, a combined total of $AUD169.8 million.

> Tourism Australia recorded a $AUD4.3 million surplus for 2004/05.

> Debts written-off during the year totalled $AUD1,800 with provision for doubtful debts at $AUD219,000 at

30 June 2005, to reflect the accrual of potentially non-recoverable debts over the year. Debtors profile and

collections were improved during the year.

> Foreign currency funds management was undertaken on a spot basis with transactions being initiated to

provide Tourism Australia with the most cost-effective level of foreign currency funding.

> Improved banking arrangements were implemented through a global banking agreement and customer

initiated web-based transactions.

RISK AND ADMINISTRATION

Administration Services supports Tourism Australia in the areas of premises and despatch services, records

management, printing, reception, occupational health and safety, office equipment supplies and maintenance.

All procurement activities undertaken by Tourism Australia were consistent with Australian Government

policies and guidelines.

The operations of the risk management area are designed to minimise risk to Tourism Australia in a cost

effective manner and to an acceptable level.

Risk management principles and practices have been incorporated further into the organisation’s decisionmaking

and operational activity.

The major operations of risk management are to:

> Provide education and awareness of risk management;

> Develop and manage systems of risk identification and effective control; and

> Co-ordinate and manage insurance, contracts, legal, audit and lease issues.

Tourism Australia has a comprehensive insurance program that includes Directors’ and Officers’ liability

managed by Comcover.

Highlights and results

> A new Australian Government procurement environment which became effective on 1 January 2005 was

introduced into Tourism Australia.

> The Tourism Australia Safety Handbook was revised and new standard contract templates were developed.

> Tourism Australia premises in Sydney, London, LA, and Shanghai were relocated.

> Occupational health and safety practices were enhanced.

26 27


Corporate Services

TECHNOLOGY SERVICES

Tourism Australia’s technology activities are managed under the four business units of the Corporate

Services division:

> Infrastructure – administration and management of the corporate infrastructure including network,

telecommunications and standard office applications.

> Applications Operations – management and support of all operational systems used in day-to-day business

and marketing activities.

> Technology Development – assessment and execution of all new technology projects as well as

management of information and communication technology governance.

> Service Desk – technology support services provided through a single point of contact for all Tourism

Australia staff.

Highlights and results

> australia.com’s hosting facilities were transferred back to Australia from a US-based agency.

> Activities continued for the implementation of a new customer relationship management system.

> Video conferencing facilities were introduced to link six Tourism Australia offices globally.

> Development and improvement of business applications and websites for australia.com, Trade Events,

Business Events, International Media unit, Finance and HR/Payroll.

> Facilities and services for the European arm of the Destination Australia Partnership (DAP) were implemented.

> Successful migration of all technology services during the relocation of Tourism Australia’s Sydney office,

which included the organisation’s central computer facilities.

> Best practice processes for IT Service Management were adopted.

HUMAN RESOURCES

The role of Human Resources is to assist in building optimum organisational performance. This includes

developing strategies and driving change in all aspects of operations to ensure that Tourism Australia has the

human capability, culture and structures necessary to meet ever-changing needs.

> Average staff numbers for 2004/05 were 111 employees in the head office, 21 employees in Canberra and 113

employees in 12 overseas offices.

> Of the 245 employees, 34 per cent were male and 66 per cent were female. Women held 34 out of 65

management positions.

> Tourism Australia remained fully compliant with all occupational health and safety requirements

during 2004/05.

> Tourism Australia maintains workplace diversity by ensuring equity in recruitment procedures and the

creation of promotional opportunities both in Australia and on a global basis.

> Tourism Australia’s Equal Employment Opportunity program especially recognises employees’ domestic and

family responsibilities. In furthering ‘family friendly’ policies, Tourism Australia offers part-time employment

and flexibility in working hours.

> There were no industrial disputes over the past 12 months.

> In line with the Commonwealth Disability Strategy, our recruitment information is provided in multiple

formats as required.

> Tourism Australia programs are held in locations that are accessible to people with disabilities.

> Tourism Australia’s employment policies, procedures and practices comply with the requirements of the

Disability Discrimination Act 1992, the Racial Discrimination Act 1975 and the Sex Discrimination Act 1984.

> Tourism Australia offers flexible working arrangements and supports staff in undertaking opportunities

for personal and professional development. Tourism Australia also provides a range of mechanisms to

enhance communication and consultation including through the Joint Consultative Committee and

regular staff surveys.

Highlights and results

> In 2004/05 the Australian Tourist Commission (ATC) transitioned to become Tourism Australia. This transition

integrated See Australia and the Canberra-based Bureau of Tourism Research with ATC to form Tourism

Australia. It also involved the realignment of business groups and recruitment of the Executive Leadership

Team for Tourism Australia.

> Outsourced payroll functions were brought in-house and a new payroll system was implemented through a

global Human Resources Information System (HRIS). The implementation of HRIS will enable improvements

in global reporting on key HR deliverables.

> A global HR audit was conducted to ensure Tourism Australia complies with local employment legislation.

> The annual staff survey was conducted in May 2005 with a survey response rate of 70 per cent. The survey

provided an insight into key areas for improvement including internal communications, career development

and training.

> A section was developed for ‘user friendly’ HR policies and procedures on the internal corporate website.

> A global induction program was introduced.

> The strategic plan People and Culture was developed and will be implemented in 2005/06.

> Tourism Australia placed 84 people in roles including 20 internal appointments.

28 29


Strategy and Research

OVERVIEW

The Strategy and Research division provides market and industry knowledge and insights that underpin all

Tourism Australia strategic and operational decisions. The area conducts and gathers research and intelligence,

from both primary and secondary sources, to help improve decision-making not just for Tourism Australia, but

for the Australian tourism industry as a whole.

The group also co-ordinates the corporate and operational planning function for Tourism Australia globally,

managing the development of Tourism Australia’s Corporate Plan and its Annual Operating Plan. A key function

within that role is the development and evaluation of the organisation’s Key Performance Indicators, helping to

measure the success of its Corporate Strategy.

A key role for the team is the co-ordination of primary survey research on both domestic and international

visitors to and within Australia. This function is undertaken by Tourism Research Australia, a business unit

within the division, and is a vital information tool for the Australian tourism industry.

CORPORATE PLANNING

The Corporate Planning unit co-ordinates the development of the organisation’s three-year Corporate Plan,

while monitoring and evaluating the corporate performance and managing operational planning processes. The

unit also co-ordinates the processes and analysis of resource allocation decision-making and is responsible for

measuring the delivery of Tourism Australia’s White Paper initiatives as directed by the Australian Government.

A key objective was to develop, approve and implement the Corporate Plan for 2005/06 – 2007/08 and the

Annual Operating Plan for 2004/05.

Highlights and results

> Tourism Australia’s first Corporate Plan for 2005/06 – 2007/08 was developed and accepted by Tourism

Australia’s Board and the Minister for Small Business and Tourism, the Hon Fran Bailey MP.

> Tourism Australia’s Annual Operating Plan 2004/05, co-ordinating the organisation’s strategies and actions in

the first year of the new organisation was implemented, with a new 2005/06 plan produced and approved.

STRATEGIC INSIGHTS

The Strategic Insights unit manages a comprehensive international and domestic market research and analysis

program, providing ongoing strategic information to Tourism Australia and the tourism industry. The unit

generates insights about customers and markets for use in planning and decision-making processes. It also

provides information for use by key external stakeholders from industry and government.

The research program is focused around brand tracking, consumer insight, creative testing, product and

experience insights, leading indicators, analysis and dissemination.

The strategic intent is to deliver industry insights, so that decisions made to help grow sustainable tourism in

Australia are based on understanding the challenges and opportunities currently facing the industry.

Highlights and results

> International brand health and communication tracking was improved with an enhanced methodology, a

new questionnaire and new interactive reporting format for internal clients. Tracking was undertaken in UK,

Germany, Italy, US, China, Singapore, Korea and Japan, generating understanding of the challenges in moving

consumers from awareness to visitation.

> A global target segment for Australia, the ‘ideal visitor’, was identified and profiled, entailing detailed

re-analysis of all segmentation studies undertaken in US, UK, China and Germany, analysis of

international visitor survey data and the commissioning of new research.

> UK, US, China and Germany segmentation models were added to the International Visitor Survey (IVS).

> Comprehensive testing of the new brand campaign was undertaken in China, Japan and Korea. This testing

determined which aspects of the campaign worked most effectively and which creative executions had the

most resonance amongst sectors of the market.

> Tracking and testing of the new domestic campaign was conducted, which identified opportunities to finetune

campaign creative and measure results.

> Tracking of various travel segments through the IVS provided an opportunity for analysis of visitor behaviour

and assisted with communication initiatives, distribution, transport and travel experience strategies for

Tourism Australia and State/industry partners.

30 31


Strategy and Research

AVIATION AND ANALYSIS

The Aviation and Analysis unit ensures Tourism Australia’s marketing

strategies take advantage of aviation developments and are sensitive

to aviation constraints.

The unit also enhances the quality and influence of Tourism Australia’s

input on aviation issues associated with airlines, airports, the

Department of Transport and Regional Services and State and Territory

tourism organisation partners.

Economic analysis is applied to review and evaluate industry

performance to help Tourism Australia’s stakeholders better

understand key drivers of the tourism industry.

A key objective for 2004/05 was to deliver industry and aviation

insights to assist Tourism Australia better align strategies to all

industry partners.

Highlights and results

> Commissioned the Australian Bureau of Statistics to complete the

Private Sector Tourism Marketing Spending survey, which provides

valuable information on the majority share of total tourism

marketing by the Australian private sector.

> In conjunction with Tourism Research Australia, an improved

indicator on the economic value of inbound tourism to Australia was

developed and adopted by the Tourism Forecasting Committee and

applied in Tourism Australia’s Corporate Plan for 2005/06 – 2007/08.

> Bilateral aviation capacity with Hong Kong and India was

significantly increased and opportunities were identified for

outbound airline services beyond these countries.

> The unit also contributed to other Australian bilateral aviation

negotiations with the United Kingdom, the United States, Singapore,

Vietnam, Korea and Taiwan.

> Briefings were held for State and Territory tourism organisations

and industry partners on the growing influence of low cost airlines

in domestic tourism and inbound tourism aviation briefings were

provided to attendees at the Australian Tourism Exchange.

TOURISM RESEARCH AUSTRALIA

On 1 July 2004, Tourism Australia was inaugurated bringing together four separate organisations – the

Australian Tourist Commission, See Australia, the Bureau of Tourism Research (BTR) and Tourism Forecasting

Council. Two new business units Tourism Events Australia and Tourism Research Australia (TRA) were

established to focus on industry and market needs.

The establishment of TRA created new opportunities to expand the wide range of activities for which BTR was

previously responsible.

TRA’s charter is to focus on producing and disseminating timely, relevant and accurate research and industry

insights while promoting the significance of research in underpinning informed decision-making.

Highlights and results

> In January 2005 the sample sizes of the International Visitor Survey (IVS) and National Visitor Survey (NVS)

were increased from 20,000 to 40,000 and 80,000 to 120,000 respectively. This expansion improved the

reliability of results by 25 per cent (IVS) and 16 per cent (NVS).

> IVS expansion allowed additional countries such as India, France, Switzerland, Netherlands, Italy and

Scandinavia to be benchmarked against Australian Bureau of Statistics (ABS) Overseas Arrival and Departure

(OAD) data.

> Quarterly survey results were available to stakeholders within nine weeks for NVS and 10 weeks for

IVS – a significant improvement in timeliness.

> A new Destination Based Survey (DBS) collection was designed and established. DBS proposals were

received from all State and Territory Tourism Organisations and a first round of seven projects were

selected for 2005/06.

> An evaluation of web-based reporting technologies to disseminate TRA data and publications was completed.

The new software will enable TRA to deliver micro-level information via its website, including mapping and

automated reporting capabilities.

> The TRA Forecasting unit’s market value methodology/forecasts now constitute the benchmark for measuring

Tourism Australia’s performance.

> A snapshot series covering markets such as backpackers, caravan and camping travellers, visitors interested in

nature, indigenous culture, Australian wine and food were developed.

> A new Tourism Forecasting Committee and Technical Sub-Committee were formed.

32 33


Corporate Affairs

OVERVIEW

The Corporate Affairs unit is responsible for the reputation and influence of Tourism Australia through the

management of government relations, media management, public relations and corporate communications

(internal and external) activities.

The unit develops and deploys effective communications strategies to ensure that Tourism Australia is

portrayed in a positive manner to the industry and all of its stakeholders, including internal audiences.

PUBLIC AFFAIRS/MEDIA RELATIONS

Highlights and results

> Ongoing issues and media management.

> Preparation of more than 60 media releases to promote Tourism Australia’s activities, generating more

than 1,000 articles in the Australian media.

> Preparation of presentations and speeches to support the Managing Director and Chairman’s

speaking engagements.

> Launch of Tourism Australia’s refreshed corporate website, tourism.australia.com.

> Management of the domestic media program at the Australian Tourism Exchange ( ATE) including press

conferences for senior management and the Minister for Small Business and Tourism the Hon Fran Bailey MP.

> Co-ordinated the launch of Tourism Australia’s domestic marketing campaign, ‘All The Space You Need’, which

featured 30 great Australian spaces.

> Developed and co-ordinated the publication of Tourism Australia’s Corporate Plan, and distributed it to all

Tourism Australia staff, ATE buyers and sellers, Australian Government Members and Senators and industry

stakeholders.

> Prepared briefing material and advice to key Tourism Australia staff in response to emerging issues that may

have impacted on Australia’s reputation.

INDUSTRY COMMUNICATIONS

Highlights and results

> Development and implementation of an Industry Stakeholder research project that will inform and direct

Tourism Australia’s future industry communications strategy.

> Co-ordinated a series of Market Briefings in all capital cities to update the tourism industry on Tourism

Australia strategies and activities.

> The Corporate Affairs unit maintains effective relationships with key industry stakeholders including the

Australian Tourism Export Council (ATEC), the Tourism and Transport Forum (TTF) and the National Tourism

Alliance (NTA).

> As part of the communication strategy for ATE, the Corporate Affairs unit supported the Trade Events team

with industry communications preceding the event, liaised with State and Territory tourism organisation

staff, and produced a daily newspaper that was distributed to all trade show delegates.

> Wrote and distributed the weekly e-newsletter essentials to approximately 10,000 industry subscribers.

GOVERNMENT RELATIONS

Highlights and results

> Co-ordinated a briefing for the Minister to update key government stakeholders, the Coalition ‘Friends of

Tourism’ on Tourism Australia’s domestic marketing campaign.

> Conducted inaugural ALP ‘Friends of Tourism’ briefing in Canberra.

> Liaised with Tourism Australia regional offices and the Department of Industry, Tourism and Resources (DITR)

and the office of Minister for Small Business and Tourism in the co-ordination of the Minister’s visit to the UK

and industry mission to China, Korea and Japan.

> Co-ordination of Tourism Australia’s participation in Industry Implementation Advisory Group (IIAG), the

Australian Standing Committee on Tourism (ASCOT) and the Tourism Ministers’ Council (TMC).

> Provided regular input into ministerial briefings and ministerial correspondence.

> Provided input into the Department of Foreign Affairs and Trade and the Department of Defence Joint

Standing Committee inquiries into Australia’s relationship with Korea and Expanding Australia’s Trade and

Investment Relations with the Gulf Region.

> Meetings and briefings with the Treasurer’s Office, Cabinet Policy Unit, Prime Minister’s Office and the

Minister for Employment and Workplace Relations on the issue of accrued leave in Australia.

> Co-ordinated specific government program for ATE, including attendance by Federal, State and Territory

parliamentarians and government department representatives.

> Co-ordinated Tourism Australia’s involvement on the Inter-Departmental Committee (IDC) International

Education Forum Sub-Committee, M2006 Communications Working Group, Australian International Cultural

Council, Aichi Expo 1st Advisory Board, National Tourism Incident Response Plan Working Group, Restaurant

and Catering Industry Action Agenda and the National Visitor Safety program.

34 35


Marketing

OVERVIEW

The Marketing department is responsible for the development and execution of Tourism Australia’s

marketing program.

The 2004/05 fiscal year has seen the execution of the ‘Australia. A Different Light’ campaign with brand

campaign strategy being evolved and executed in line with Tourism Australia’s Corporate Plan.

As part of the evolved brand strategy, support services were developed to ensure the optimal

effectiveness of the campaign. A particular focus for Marketing has been the development of

online and digital marketing platforms.

CONSUMER MARKETING

The role of the Consumer Marketing division is to develop the strategy

for the development and implementation of Brand Australia through

marketing communication across the world. It also provides resources

such as images and marketing collateral to support the consistent

representation of Australia on the world stage.

There are two units within Consumer Marketing: Advertising and

Design, and the International Media unit. The Advertising and Design

unit manages the production of guidelines and marketing materials,

and the International Media unit is responsible for product- and

destination-focused public relations activities including the Visiting

Journalists Program.

Highlights and results

> The Consumer Marketing division oversaw the launch of new Brand

Australia campaigns in North America, Hong Kong, China, and Japan,

and ensured all local adaptations to the campaigns were consistent

with the overall creative strategy.

> New advertising guidelines were developed and used

globally, ensuring a consistent approach to co-operative

marketing partnerships.

> Tourism Australia worked closely with Austrade in the development

of an integrated identity for all offshore trade events and Business

Club Australia. The co-operation with Austrade has resulted in a

more consistent representation of Australia overseas.

> A global advertising and media agency review resulted in the

selection of M&C Saatchi and Carat to undertake Tourism Australia’s

advertising and media buying activities going forward.

> The creation of a Brand Australia communications framework for the

promotion of the Melbourne 2006 Commonwealth Games overseas

resulted in effective outdoor and print campaigns in the United

Kingdom, Malaysia and Singapore.

36 37


Marketing

ADVERTISING AND DESIGN

The Advertising and Design unit manages the production of global

marketing communications, materials and applications, and ensures

the Brand integrity of all programs.

The unit also incorporates Creative Services, which supplies

artwork, printed material, images and video footage to all Tourism

Australia offices, supporting the organisation to achieve its

communication objectives.

Highlights and results

> Comprehensive guidelines for a new Brand Australia visual identity

were launched and distributed in September 2004, featuring new

consumer and corporate logos, design guidelines and an image style

guide. These guidelines have been extensively used by all Tourism

Australia offices resulting in design consistency for the brand.

> The ‘hero photography shoot’ was conducted over a 10-month

period and resulted in high quality, motivating images that have

been used extensively by all Tourism Australia offices in advertising,

collateral, online and trade events. The new ‘hero’ images include

Australian icons and experiences from all States and Territories.

> The image and video libraries were made available to tourist

operators, domestic media, international media and commercial

partners providing access to highest quality imagery and footage

of Australia.

> The ‘Song for Australia’ national songwriter’s competition was

conducted to find a song capturing the essence and spirit of

Australia. The winning song, by Jackie Bristow was recorded

in October 2004 with a music video developed in November

2004. The song was launched on 23 November 2004 resulting in

comprehensive TV, press and radio coverage nationally.

INTERNATIONAL MEDIA

The International Media unit is responsible for driving Tourism Australia’s

global brand message through worldwide public relations activities that target

consumers in key overseas markets.

The unit is responsible for the International Media Relations Program (IMR)

and the Visiting Journalists Program ( VJP).

The IMR program ensures up to date information, news and copyright-free

information is distributed through the global public relations network. The VJP

hosts targeted media from around the world, who report on Australia’s many

experiences and attractions. The unit is also responsible for managing Tourism

Australia’s media website.

Highlights and results

> In 2004/05 Tourism Australia hosted 802 international print and broadcast

journalists to Australia through the VJP, delivering Brand Australia messages

to millions of potential travellers from around the world. The media value

generated from coverage was in excess of $AUD483 million. Some of these

visits included hosting:

• 18 of China’s most influential travel journalists as part of the ‘Colours

of Australia’ promotion, reaching an audience in excess of 105 million

people with a media value of around $AUD10 million;

• Celebrity photographer Rankin who captured the spirit of Australia for

an exhibition in central London, with associated activities reaching an

audience of around 8.4 million people;

• GMTV, the United Kingdom’s highest rating breakfast program. The

resulting program reached over 30 million viewers and generated

exposure estimated to be worth $AUD4 million;

• Journalist Tom Clynes, whose unique experience learning to fly while

visiting three Australian states generated a major feature story in

National Geographic Adventure magazine, reaching over 500,000 readers.

> The international media program at ATE targeted 42 international media,

boosting the coverage of Australia in trade publications in 21 countries.

Coverage received to date is valued at almost half a million dollars. In

addition, the international media program at Dreamtime 2004 targeted

20 international media from 13 countries.

38 39


Marketing

E-STRATEGY AND MARKETING

The e-Strategy and Marketing division was formed in January 2005

and has two main business units: e-Marketing and e-Business.

e-Marketing promotes Australia through digital media initiatives, such

as australia.com, website planning, partnership development and

online strategy development. The purpose of the group is to generate

brand awareness in the digital environment and deliver relevant

information to consumers.

The second area, e-Business is responsible for the strategic direction

and management of Tourism Australia’s business-to-business

marketing programs, including the contact management system.

Highlights and results

> In 2004/05 australia.com recorded over 120,000 pages per day of

online traffic – an annual total of more than 45.7 million pages.

Visitation to the North America site now accounts for 46 per cent of

all online contact, Europe represents 22 per cent, Japan 11 per cent

and Australia 10 per cent.

> In this financial year, australia.com displayed 18,300 Australian

tourism products, from the Australian Tourism Data Warehouse

(ATDW). This was a nine per cent increase over 2003/04.

> In October 2004, chat rooms and bulletin boards were launched on

the Japanese edition of australia.com. The initiative, known as ‘My

Style Australia’ saw a 40 per cent growth in visits to chat rooms by

young Japanese women aged between 20-39 years.

> The interactive space.australia.com website was launched in

March 2005 as part of Tourism Australia’s first domestic brand

marketing campaign.

> The ‘What’s On’ area of australia.com was improved with a calendar

that allows consumers to search for events and festivals around

Australia by date, region, scale or type. This event data is contributed

by the Australian Tourism Data Warehouse (ATDW).

> In June 2005, Tourism Australia’s media site was updated to improve

service to international media and allow journalists access to a

range of media collateral.

> e-Business rolled out a formalised training program for Tourism

Australia’s global staff to use the content management system,

introducing an online support tool and user framework.

BUSINESS EVENTS

The Business Events unit focuses on positioning Australia as a highly

desirable international business events destination.

The unit acts as a co-ordinator between organisations and

governments to maximise the return on investment associated with

attracting and staging international events in Australia, as well as

working with government departments on issues that impact on the

Australian business events industry.

Highlights and results

> The National Business Events Study was launched on 14 December

2004. The study’s key findings showed that business events in

Australia are valued at $AUD17.36 billion and create 214,000 jobs.

For the first time, incentive statistics were available indicating this

market is valued at $AUD585 million.

> Australia’s premier incentive travel event, Dreamtime, was held in

November 2004, showcasing a wide range of tourism products to

global incentive travel buyers. Since its inception, Dreamtime has

developed a reputation as a leading trade show and familiarisation

program for the incentive tourism industry in Australia.

> Tourism Australia hosted three corporate familiarisations, including

the first New Zealand visit, in June 2005. The aim of the program

was to move corporate decision-makers towards conversion.

> Team Australia, the marketing alliance between members of the

Association of Australian Convention Bureaux (AACB) and Tourism

Australia, successfully completed three international projects.

40 41


Australasia

OVERVIEW

The Australasia department is responsible for marketing to Australia’s two largest source markets in terms of

volume – the domestic market and New Zealand.

The Australia Marketing unit aims to stimulate interstate leisure tourism by encouraging more Australians to

think “Australia could satisfy my holiday needs more than I realised”.

The New Zealand team, based in Auckland, manage campaign strategies that ensure Australia continues to

hold the dominant share of New Zealand’s outbound travel.

For the purpose of this Annual Report, New Zealand has been included in the International Markets section

on page 67.

The Australasia department also maintains regular industry contact through the Partnership Marketing unit,

the Australian Experiences unit and the Trade Events unit.

DOMESTIC MARKETING

Domestic leisure tourism accounts for approximately 70 per cent of

all tourism expenditure in Australia. Domestic tourism plays a key role

in dispersing the economic and social benefits of tourism throughout

rural, regional and remote Australia with 53 cents of every domestic

tourism dollar being spent outside capital cities.

The Australian domestic leisure market has been stagnant for the

past 10 years, with less than one per cent annual growth in overall

visitor nights and visitor spend. In 2004 the outbound market grew

29 per cent. This provided Tourism Australia with a unique challenge

to increase domestic tourism in the face of increased demand for

overseas travel.

Tourism Australia’s objective is to stimulate interstate leisure tourism

by encouraging more Australians to think “Australia could satisfy my

holiday needs more than I realised”.

Highlights and results

> A new domestic marketing team was established as part of the

formation of Tourism Australia. A three-year strategy for domestic

tourism was created and rolled-out.

> The $AUD8 million ‘All The Space You Need’ marketing campaign

was launched on 29 March 2005. The campaign targeted Australia’s

‘ideal visitors’ who have high disposable incomes and, despite

preferring overseas travel, do not reject an Australian holiday.

> The four-month campaign included print, online, TV and cinema

advertising, as well as direct mail and public relations activities,

such as:

• Direct mail to 500,000 frequent traveller households in Sydney,

Melbourne and Brisbane;

• Media sponsorship of the Rugby Lions Tour on Foxtel with

a purpose-produced advertisement featuring Rugby legend

Phil Kearns.

• Two purpose-produced magazines were inserted into Fairfax

newspapers with a combined circulation of over one million.

All content and advertising was dedicated to unique Australian

travel experiences.

> All campaign activities drove consumers to a dedicated microsite on

australia.com, which featured information on Australia’s ‘30 Great

Spaces’ as well as ‘10 great drives’ and ‘10 great beaches’. The highly

interactive website allowed consumers to search for information

and plan Australian holidays.

> The ‘Spaces’ campaign generated almost 400,000 new and unique

users to australia.com over the duration of the campaign

> The campaign reached 85-90 per cent of the target audience 10

(plus) times. The campaign was strong on message and outdid

previous domestic marketing efforts on most measures.

42 43


Australasia

PARTNERSHIP MARKETING

Partnership Marketing is responsible for developing industry relationships through the provision of market

intelligence, insights and opportunities to the Australian tourism industry. The unit is also responsible for cooperative

sales programs targeting trade and consumers, thereby improving Tourism Australia’s understanding

of industry program development.

In partnership with Tourism Queensland, the Industry Development Executive Pilot Program brought greater

awareness of Tourism Australia throughout Queensland.

Highlights and results

> The unit conducted over 500 market updates and research presentations to industry partners. It also linked

over 500 industry partners to Tourism Australia’s global marketing campaigns.

> Over 200 Australian industry contacts per month were recorded. These included presentations on market

insights, intelligence and co-operative opportunities.

> Promoted co-operative marketing opportunities to the industry, generating sales to the value of

$AUD1.8 million.

> The unit produced The Big Book of Australia in partnership with Tourism New South Wales, Tourism Victoria

and Tourism Western Australia, with subset publications for each state involved. The program delivered

significant cost and resource savings by sharing resources.

> A focus for the year was on the development of the organisation’s Customer Relationship

Management program to ensure all staff have greater access to the latest intelligence concerning

Tourism Australia’s partners.

> Self-help systems such as the Marketing Mix Builder, which assists in planning marketing activities with

Tourism Australia, were maintained and updated for Australian partners.

AUSTRALIAN EXPERIENCES

The role of the Australian Experiences unit is to develop and

communicate niche experiences, as identified in the Australian

Government’s Tourism White Paper (2003), to foster long-term

economic growth, especially in regional areas.

This involves identifying travel experiences and supporting the

necessary development of infrastructure and marketing programs.

The unit works with state and territory tourism offices, industry

groups and businesses to develop and actualise new Australian

tourism experiences.

In collaboration with other areas within Tourism Australia, the unit

ensures these experiences are connected to global consumers via

e-marketing, tactical marketing, public relations and media programs.

Highlights and results

> As an early initiative, the Aussie Experiences Kit was developed,

providing ‘off the shelf’ support for industry associations and

tourism businesses in targeted segments. The toolkit includes

experiences research snapshots, images, access to promotional

material, and distribution information.

> Strategic alliances were established with the Department of

Industry, Tourism and Resources (DITR), State Tourism Offices and

other industry associations.

> Travel experiences in Nature, Food and Wine and Indigenous

were showcased at three Australian Tourism Exchange ( ATE)

lunches, attended by over 2,000 international and local tourism

industry representatives.

> Developed the framework for Indigenous Tourism Australia (ITA),

to be established on 1 August 2005.

44 45


Australasia

TRADE EVENTS

The Trade Events unit plan, prepare, implement, manage and

review all global trade events for Tourism Australia while working

with stakeholders such as Qantas, State Tourism Offices, and the

Destination Australia Program (DAP) in Europe.

It ensures trade event activities are communicating the

corporate messages and brand of Tourism Australia to the

global distribution system.

The implementation of Trade Events Online (TEO) has streamlined

the event process to better match the needs of buyers and sellers

at events.

Highlights and results

> The Australian Tourism Exchange ( ATE) 2005 was held in Perth,

the first time the event has moved from the east coast of Australia.

Around 100,000 business-to-business meetings were held between

2,000 buyers and sellers at the event and over 500 international

buyers experienced more of Western Australia in touring

familiarisations before and after the event.

> An ‘ Aussie Specialist Pilot Program’ saw 20 United Kingdom and 20

American Aussie Specialist travel agents attend ATE for the first time

with the support of the industry and wholesalers.

> ATE Perth had a record 90 per cent approval rating from buyers and

96 per cent approval rating from sellers at the event.

> 30 other global trade events were co-ordinated by the Trade Events

team in 2004/05 across all major markets.

Trade Events 20042005

EVENT NAME DATES COUNTRY

Visit Americas Roadshow 11-22 July 2004 US

Meeting Professional International 25-27 July 2004 Canada

Oz Talk SE Asia 29 July - 4 August 2004 KL, Hong Kong

Oz Talk USA 9-12 August 2004 US

Corroboree USA 23-25 August 2004 US

Luxury Travel Expo – NY 7-10 October 2004 US

India Travel Mission 2004 15-19 September 2004 India

WYSTC 12-18 September 2004 Spain

PRIME 16-19 September 2004 US

PATA 22-24 September 2004 Singapore

Incentive Travel & Meeting Executive 28-30 September 2004 US

Incentive Travel & Conventions, Meetings Asia 12-14 October 2004 Thailand

Australian Travel Mission to China 24-27 October 2004 China

Dreamtime 28 October - 2 Nov 2004 Australia

World Travel Market 8-11 November 2004 United Kingdom

China International Travel Mart 25-28 November 2004 China

EU Incentive, Business Travel & Meeting Exhibition 1-2 December 2004 Spain

International Luxury Travel Market Exhibition 7-9 December 2004 France

Luxury Travel Expo – Las Vegas 7-9 December 2004 US

Visit Americas Roadshow 9-19 January 2005 US

American Express Australia Travel and Education Expo 20-21 January 2005 US

Vankantierbeurs 11-16 January 2005 Netherlands

DT Adventure Travel & Sports Show 14-16 January 2005 United Kingdom

Holiday World Dublin 27-30 January 2005 Ireland

Destinations 3-6 February2005 United Kingdom

TA Market Briefings 9 February - 22 April 2005 Australia

Borsa Internazionale del Turismo 12-15 February 2005 Italy

Japan Australia Mission 24-26 February 2005 Japan

Internationale Tourismus Borse 11-15 March 2005 Germany

Oz Talk NZ April 2005 New Zealand

Gulf Countries Roadshow 23-27 April 2005 Middle East

ATEC Symposium 26-29 April 2005 Australia

Arabian Travel Market 3-6 May 2005 UAE

Discover Australia 13-15 May 2005 Australia

IMEX 19-21 April 2005 Germany

Australian Tourism Exchange 18-24 June 2005 Australia

46 47


International

OVERVIEW

The International unit is responsible for managing Tourism Australia’s

operations across five key regions of UK/ Europe, Asia, Japan, Americas and

Gulf Countries. The unit also manages the Aussie Enthusiast program which

covers markets where Tourism Australia does not have an active presence.

The unit is responsible for a wide range of activities including management

of key tourism issues, global partnerships and distribution, market intelligence

and knowledge, as well as day-to-day interaction with Tourism Australia’s

12 international offices.

The unit provides guidance and consultation in international markets both

internally and externally, represents Tourism Australia on major Government

and Industry committees and panels relating to international markets and

issues, and provides ongoing dialogue and development with State and

Territory Tourism Organisations (STOs) via the Destination Australia Marketing

Alliance (DAMA).

The International unit is the key interface between the overseas markets

and Australia.

INTERNATIONAL OPERATIONS

The International team also manages the organisation’s global trade and

industry partnerships, guaranteeing Australia’s capability to meet consumer

needs through commercial outlets such as travel agents, online operators and

the broader travel distribution system.

Highlights and results

> A framework was built that allowed Tourism Australia’s business and

industry partners to access the most up-to-date and relevant tourism

information. This information assists profitability and sustainability amongst

industry partners.

> A platform to source industry information from around the world was made

available through Tourism Australia’s corporate site.

> Profiles on international markets were prepared, ensuring Tourism Australia’s

industry partners had access to the latest trends to assist in the development

of various industry programs.

INTERNATIONAL PARTNERSHIPS

The International unit develops and manages global airline partnership agreements for Australia with airlines

such as Qantas, Singapore Airlines and Emirates.

The unit represents Tourism Australia on the Boards of the Australian Tourism Export Council (ATEC)

and the Pacific Asia Tourism Association (PATA). It also represents the organisation on the Destination

Australia Marketing Alliance (DAMA), a joint partnership between the Australian State and Territory

Tourism Organisations.

The unit also co-ordinates stakeholder consultation through the International Industry Advisory Panels (IAP) to

provide strategic advice and direction in relation to Tourism Australia’s global strategy.

Highlights and results

> Richard Beere, Director of International Operations, Tourism Australia’s nominated representative to the PATA

Board, has been elected Chairman of PATA and will assume the role in March 2006 for a 12 month period.

> One of the main areas of focus for 2004/05 was the inauguration of Destination Australia Partnership (DAP)

in Europe through the Destination Australia Marketing Alliance (DAMA). The unit oversaw the co-location

of these entities and assisted with the strategic alignment of Tourism Australia and State and Territory

tourism organisations in the region. DAP will now enable Tourism Australia to increase its penetration in core

European markets.

> Preparation of a new framework for airline partnerships, to ensure the expanding needs of the Australian

tourism industry are met. This has resulted in the expansion of airline partnerships around the world.

INTERNATIONAL ISSUES

Members of Tourism Australia’s International unit represent the organisation on a number of industry groups

that monitor and manage tourism issues for Australia. The Korea Tourism Industry Group (KTIG) looks at quality

issues in the Korean market and the China Joint Monitoring Group (CJMG) monitors quality issues in the China

market. CJMG also facilitates sustainable and long-term tourism opportunities in the China.

Locally, the unit acts for Tourism Australia on the Tourism Visa Advisory Group (TVAG), a partnership between

government agencies and industry that reviews global visa issues. Other agencies and tourism industry

representatives involved in this group are the Department of Industry, Tourism and Resource (DITR), the

Department of Immigration and Multicultural and Indigenous Affairs (DIMIA), State Tourism Offices, Qantas

and the Australian Tourism Export Council (ATEC).

Highlights and results

> In conjunction with KTIG, the unit assisted with the implementation of a national action plan to address

key issues in the Korean market. Tourism Australia had specific areas of responsibility within the plan and

reported to the Minister and Department of Industry, Tourism and Resources (DITR) on these achievements.

> Work continued with government in 2004/05 to facilitate changes to the Approved Destination Status (ADS).

Tourism Australia worked with DIMIA, DITR and ATEC in the development of a framework and procedures for

the Australian industry to co-ordinate sale of Australian holidays in China.

> A partnership established with DIMIA provided a platform to table and resolve regional challenges

and market failures through the visa process. Areas of focus included the Working Holiday Visa Program,

Gulf Region, Thailand and China. This resulted in the ‘Preferred Agents Scheme’ being introduced in India

and Russia.

48 49


International

AUSSIE ENTHUSIASTS

The Aussie Enthusiasts Program was launched in 2004 as a major initiative of

the Memorandum of Understanding (MOU) between Austrade and Tourism

Australia. Available to all international travel agents regardless of location,

the program is designed to extend Australia’s reach in international markets

where Tourism Australia does not have an active presence.

A framework now exists for Tourism Australia to service tourism operators

working in non-priority markets. Under the MOU, agents have been assisted to

better sell Australia in countries such as Mexico, Finland, Philippines, Vietnam,

Belgium, Czech Republic, Latvia, South Africa, Brazil, Russia, Argentina, Poland

and Nigeria.

The program can be accessed at tourism.australia.com/enthusiasts and via

the Austrade network in 57 countries around the world. It is also available to

agents via their inbound tour operator (ITO) partners in Australia. Toolkits and

promotional materials supporting the program have been distributed to 123

international Austrade offices, 51 Tourism Australia regional contacts, eight

State and Territory Tourism Offices and 61 Inbound Tour Operators (ITOs).

Highlights and results

> Austrade identified and are working with 47 agencies in Tourism Australia’s

non-priority markets. 15 new agencies contacted Tourism Australia directly

and have been serviced under the Aussie Enthusiast Program. Australianbased

tourism operators were also encouraged to engage the services of

Austrade when visiting markets where Tourism Australia did not have an

active presence.

> Under the Aussie Enthusiasts Program, Tourism Australia provided support

for various Austrade events such as: Australia Week in Moscow (10-15 May

2005), Austrade Education Exhibitions, the Australian Schools Open Day in

Vietnam (18-22 June 2005), Australia Wine Tasting in Malta (17 June 2005),

and Australia Day Activities in Mexico.

> The Latin American gateway on Tourism Australia’s consumer website

(australia.com) was translated into Spanish, as was the ‘ Aussie Specialists’

online travel agents’ training program.

> Partly as a result of working with Austrade in Mexico, Latin America has

been elevated as a tourism market ‘with potential’ and is now managed by

Tourism Australia’s Los Angeles office.

Tourism Australia worked with Qantas to tailor the Aussie Enthusiast Program

for the airline’s sales representatives and general sales agents in key markets

of South America, Eastern Europe, South East Asia (Vietnam, Philippines),

South Africa and North Africa.

50 51


INTERNATIONAL MARKETS


The Americas

CANADA

OVERVIEW

Canada is an important contributor to Australian tourism, delivering around 98,000 visitors each year, and is

also a top performer in terms of visitor length of stay and expenditure.

Canadians take over 6 million long-haul vacations each year, searching the world for unique experiences.

Australia has great appeal among this travel base, to the extent that one in two long-haul travellers include

Australia on their list of ideal vacation destinations. However, lack of knowledge, combined with perceptions

relating to time, cost and complexity make the road from aspiration to conversion a difficult one for Australia.

The Canadian market is very price elastic and airfare is an important determinant of competitive market share.

The market is seasonal, with the northern winter a key driver in overall travel.

2004/05 saw Tourism Australia’s strongest result in this market. 44 per cent of all enquiries to Tourism

Australia’s marketing was converted within six months of response, compared with 31 per cent for the US.

Highlights and results

> The ‘Australia. A Different Light’ co-operative campaign delivered 4,401 enquiries with a media efficiency of

$91 per lead. This was an excellent result on the heels of the successful ‘Have You Ever’ campaign last year

(1,890 leads at $166).

> The co-operative Qantas Airpass product strategy was very successful, generating 82 per cent of all enquiries,

with three times the media efficiency and conversion power of traditional package advertising.

> The Aussie Specialist Program was restructured with 25 travel agencies enlisted as Premier Aussie Specialists

in Canada. The new program allows Tourism Australia to distribute consumer leads to its top retail converters,

while at the same time providing a framework to measure customer acquisition and conversion through the

retail network.

> australia.com was Tourism Australia’s primary communication platform in North America. In the

space of 12 months, the site experienced a dramatic increase in consumer traffic, lead generation

and conversion power.

> Tourism Australia-influenced ( VJP and proactive outreach) coverage of Australia reached a cumulative

audience of 34.02 million Canadians.

UNITED STATES

OVERVIEW

The US holds enormous opportunity for Australian tourism, with an

affluent consumer base of long haul travellers.

Australia’s appeal among American travellers is unmatched by any

destination in the world to the extent that one in two Americans

include Australia on their list of ideal vacation destinations. The

challenges in converting enquiries into bookings includes the depth

of knowledge of Australian tourism experiences and perceptions of

distance, time and cost.

The key market objective for 2004/05 was to convince Americans

to take their first step towards realising their Australian vacation,

recognising that they are (1) becoming ‘fully independent travellers’,

(2) increasingly hard to reach through traditional media, and (3) want

to ‘buy’ not be ‘sold to’ in the traditional marketing paradigm.

The return on investment (ROI) for Tourism Australia’s marketing in

the US for 2004/05 stands at 1:65 (for every $1 spent on marketing,

$65 has been returned to the Australian economy in air and land

sales). This is a significant improvement on the marketing efficiency of

the ‘Have You Ever’ campaign last year with a ROI of 1:48.

Highlights and results

> The ‘Australia. A Different Light’ co-operative campaign set a high

standard for Tourism Australia’s marketing in the US, delivering

33,216 enquiries with a media efficiency of $173 per lead.

> The co-operative Qantas Airpass product strategy contributed 76 per

cent of all enquiries in the growing FIT market, with twice the media

efficiency and conversion power of traditional package advertising.

> australia.com has matured into Tourism Australia’s primary

communication platform in North America. In the space of 12

months, the site has witnessed a dramatic increase in consumer

traffic, lead generation and conversion power. This accomplishment

demonstrates the clout of a fully integrated marketing effort that

combines a winning product strategy, big brand PR, and technology

designed to enhance customer engagement, such as the interactive

‘Stevo’ personality. In his first month on the site, ‘Stevo’ increased

consumer click-throughs from the homepage by 400 per cent.

> In January 2005, the Australia Week festival in Los Angeles garnered

unprecedented exposure for Australia in the US, including six

stories on national television entertainment and news programs

to a combined audience of 10 million people. More than 6,000

consumers and trade attended Australia Week events.

> The two-tier Aussie Specialist Program was launched in January

2005. Over 130 travel agents enlisted as Premier Aussie Specialists

across North America.

> Tourism Australia-influenced ( VJP and proactive outreach) coverage of

Australia reached a cumulative audience of 139.5 million Americans.

54 55


Asia

CHINA

OVERVIEW

Tourism growth from China remained strong during 2004/05

with Australia receiving 274,400 visitors, a 27 per cent increase

over 2003/04.

There was strong growth in incentive travel from China during

2004/05. Tourism Australia worked closely with large corporate

organisations to secure incentive business including Amway

China, that travelled to Australia with a group of 13,000 for

a sales conference.

The Approved Destination Status (ADS) scheme was expanded from

Beijing, Guangdong and Shanghai to include six additional provinces:

Chongqing, Hebei, Jiangsu, Shandong, Tianjin and Zhejiang. As a result

of this expansion, citizens from nine provinces numbering 432 million

people, are now allowed to travel to Australia.

The Australian Government launched an enhanced ADS framework

to demonstrate Australia’s commitment to the market and ensure

that the quality of tourism experiences is upheld and maintained.

The ADS changes were well supported by the China National Tourism

Administration (CNTA), the Chinese Government agency responsible

for developing, promoting and regulating China’s inbound and

outbound tourism industry.

Highlights and results

> The refreshed Brand Australia was launched in Beijing, Shanghai

and Guangzhou in March 2005. A range of marketing activities were

co-ordinated across the country and the campaign was well received

by media and the trade.

> The Qantas/Tourism Australia co-operative brand advertising

campaign was launched in Shanghai in October 2004, and included

both television and outdoor advertising. The campaign received a

positive response and was followed by the re-instatement of Qantas

flights between Australia and Shanghai.

> Tourism Australia in conjunction with Visa launched the ‘ Visa Prefers

Australia’ campaign, targeting the upper-end holiday market,

including Visa card holders in Beijing, Shanghai and Shenzhen.

> Tourism Australia co-ordinated the 8th annual Australian Travel

Mission to China which attracted 53 sellers from 40 organisations

(39 Australian companies and China Southern Airlines) and 194

buyers from 137 organisations (Chinese travel agents from the

nine ADS regions). The mission provided the opportunity for

Australian product suppliers to better understand the new and

emerging source regions within China and to showcase Australian

tourism product.

> 137 travel agencies signed up to the Aussie Specialist Program in

2004/05 (19 per cent increase on the previous year). 640 registered

agents (6 per cent increase) and 441 (86 per cent increase) fully

qualified agents also signed onto the program.

> 18 of China’s most influential travel journalists travelled to Australia

for a month-long tour as part of the Visiting Journalists Program

( VJP). Overall, the visit generated a total media value of $AUD9.9

million. Starting in Western Australia, the journalists from

sohu.com, Lifestyle newspaper, Shanghai Morning Post and

Guangzhou Daily covered six states and territories in 33 days.

Oriental TV’s Art and Entertainment Channel also filmed material

for a 10 episode television series about travelling in Australia. The

prime time series called Colours of Australia showcased Australia’s

culture, lifestyle and tourism experiences.

> 75 buyers from 63 organisations attended the Australian Tourism

Exchange ( ATE) in Perth this year.

> Nine corporates and 13 agents attended the Team Australia Business

Events Educational while 14 agents attended Dreamtime.

> Tourism Australia co-ordinated 10 print and two broadcast media

visits to Australia involving 33 journalists as part of the VJP. In

addition, there were 714 media stories generated by Tourism

Australia’s public relations activities.

56 57


Asia

HONG KONG

OVERVIEW

Tourism growth from Hong Kong recovered strongly and is nearly back

to record levels. Australia received 148,900 visitors in 2004/2005, a 13

per cent increase over 2003/04.

A number of initiatives were launched during the year to maintain

interest in Australia and drive visitors to discover new regions and

experiences.

Highlights and results

> The new brand campaign, ‘Australia. A Different Light’, was launched

in Hong Kong in March 2005. More than 23 key media attended

including ATV, Bloomberg TV, RTHK, the International Herald Tribune,

Newsweek, HK Economic Times and Action Asia.

> Tourism Australia partnered with Qantas and the South Australian

Tourism Commission in two co-operative brand campaigns that

utilised billboards and trackside posters at major train stations,

product information on australia.com, an e-newsletter distributed

to 20,000 consumers and print advertising in key publications.

Three other co-operative campaigns were sponsored with Cathay

Pacific Holidays.

> The 7th Team Australia Business Events Educational (TABEE), held

in Hong Kong in March, brought together 80 Asian corporate travel

agents and 40 Australian business tourism suppliers. To date, the

event has generated nine pieces of confirmed business, accounting

for almost 2,500 passengers to Australia.

> Tourism Australia’s marketing activities in the incentive sector

generated seven pieces of confirmed business (departures in

2004/05) and a total of 1,170 passengers.

> Agent participation in the Aussie Specialist Program (ASP)

increased by 62 per cent over the previous year, with the number

of graduates rising dramatically by 256 per cent. Twenty-nine

agencies and 191 agents have now joined the program in

Hong Kong with 121 ASP graduates.

> The Hon Fran Bailey MP, Minister for Small Business and Tourism

made her first official visit to Hong Kong to meet with key trade,

industry and media representatives. The visit further confirmed

Australia’s commitment to this important market and the region.

INDIA

OVERVIEW

This financial year saw visitors from India reach 59,200 an increase of

10 per cent over 2003/04, and the highest rate ever achieved.

The Aussie Specialist Program continued to build the distribution

network in the two key markets of Mumbai and Delhi as well as other

secondary markets.

Tourism Australia continued to work with other Australian

Government agencies including the Department of Immigration,

Multicultural and Indigenous Affairs (DIMIA) to facilitate faster visa

application and approval for Aussie Specialists’ clients.

A key objective for 2004/05 was to position Australia as an ‘out of

the ordinary’ holiday destination while ensuring the relevant tourism

products were available through the primary distribution channel.

Highlights and results

> Brand Australia was successfully launched in March 2005. Eightysix

media representatives from Delhi and Mumbai attended the

event, which resulted in 70 press articles with a media value of

$AUD140,000.

> NDTV, India’s leading news channel, broadcast live from the Gold

Coast and Sydney for its NightOut lifestyle program. The broadcast

showcased aspects of Sydney and the Gold Coast. There were a total

of 23 episodes of 30 minutes recording an airtime value of more

than $AUD2.9 million.

> 357 travel agents from 103 agencies enrolled in the Aussie Specialist

Program, an increase of 79 per cent and 69 per cent respectively over

2003/04. Of these, 152 agents completed the program, an increase

of 31 per cent on the previous year. This exceeded the target set at

the beginning of the fiscal year of 220 individual registered agents

and 60 agencies.

> A very successful India Travel Mission was held in Goa in September

2004. The event was attended by 25 Australian suppliers and more

than 100 Indian travel agents.

> In September 2004, Qantas resumed operations in India with nonstop

direct flights between Mumbai and Sydney. Tourism Australia

and Qantas launched a co-operative brand campaign to capitalise on

services in August/September 2004 and February/April 2005.

> Tourism Australia co-ordinated a booth at the Celebrate Vivaha 2004

– a bridal show in Delhi which attracted 350 couples who registered

an interest in honeymooning in Australia.

> The interactive promotion with Barista Coffee using mobile phones,

recorded 2,507 responses during the fortnight-long campaign in

March/April 2005.

58 59


Asia

KOREA

OVERVIEW

The Korean market continued its growth in 2004/05 delivering

237,300 visitors to Australia, a 10 per cent increase over 2003/04.

The Australian Government demonstrated its commitment to the

market with the launch of an action plan called Korea: Building

the Framework for Sustainable Tourism, a strategic framework for

government and industry to identify opportunities and support

sustainable tourism growth in the Korean market. The plan was

endorsed by the Korean Government.

Aviation capacity continued to prove challenging in Korea and Tourism

Australia worked closely with airline partners to address this issue.

Highlights and results

> Tourism Australia launched a fully integrated marketing campaign

in March called the Best of Australia. The campaign was targeted

at young FIT travellers and showcased a range of Australian

experiences including food and wine, unique wildlife and

cosmopolitan cities. As part of the campaign, Tourism Australia

utilised Asia’s largest portal site daum.net to promote itineraries and

touring routes. The website received 5,336,522 visitors.

> Australia was the focus of the opening episodes of a popular drama

series shown in Korea. More than 3.6 million viewers tuned in to the

drama I’m sorry, I love you. In response to the popularity of the series,

Asiana Airlines blocked 7,000 seats from Korea to Melbourne via

Sydney between March to June.

> The launch of the Aussie Specialist Program in October 2004

generated significant interest among the travel trade with 174

agents from 91 travel agencies now registered in the program.

> Seven major corporate companies held incentive visits to Australia

with a total of 3,246 passengers.

> Tourism Australia successfully worked with Korean Air and trade

partners to secure six charter flights to Cairns between December

2004 and January 2005. The final load factor was 93 per cent (1,646

occupied seats out of a total 1,776 seats). The flights enabled

Tourism Australia to introduce new destinations to Korean travellers

including Cairns and the Great Barrier Reef.

> Major highlights from VJP visits included top Korean newspaper

JoongAng Ilbo reporting on tennis during the 2005 Australian

Open tennis tournament and Elle Korea covering high-profile stars

from the Korean drama Non Stop visiting Melbourne. Footage was

broadcast on popular Korean music and entertainment programs

including m.net and MBC Session TV Entertainment. The coverage

coincided with a seven-day tour package to Sydney and Melbourne.

MALAYSIA

OVERVIEW

Australia received a total of 169,000 visitors from Malaysia during

2004/05, a drop of four per cent over the same period last year.

However, the market increased by three per cent during the last six

months of the financial year. Malaysia remains one of the key Asian

markets for Australia with a high level of repeat visitation.

Highlights and results

> To support the brand campaign and My Australia Challenge, Tourism

Australia worked with all State and Territory Tourism Organisations

to develop The Best of Australia packages targeted at self-drive and

family segments. Eleven Aussie Specialist agencies participated in

the campaign, and 1,934 passengers confirmed bookings against a

target of 1,000.

> A 30-second television commercial featuring Delta Goodrem aired

on terrestrial and satellite stations and a 60-second version was

screened at major cinemas around Malaysia.

> Brand Australia was launched in February 2005 with 64 media

representatives attending the event. The launch resulted in

approximately $AUD150,000 worth of coverage.

> 210 travel agents from 35 agencies enrolled in the Aussie Specialist

Program (ASP) in 2004/05, an increase of 51 per cent and 14 per cent

respectively. Of these, 68 agents have fully completed the program,

an increase of 62 per cent on the previous year.

> The first ever all-Australian broadcast initiative in Malaysia was coordinated

in partnership with leading channel NTV 7 and State and

Territory Tourism Organisations. The seven-episode reality television

program delivered a media value of $AUD2,604,000. Print supported

the broadcast initiative and coverage was estimated at an additional

$AUD250,000.

> Australia had a significant presence at the annual Malaysian

Association of Tour and Travel Agents (MATTA) International Travel

Fair and the Malaysian Airlines Travel Fair which attracted 72,000

and 83,500 visitors respectively.

60 61


Asia

SINGAPORE

OVERVIEW

Australia received a total of 267,500 visitors from Singapore in

2004/05, an increase of six per cent over the previous year.

Singapore continued to be one of Australia’s most important markets

for arrivals with high repeat visitation. Tourism Australia’s activities

were focused on refreshing Australia’s profile to entice repeat visitors

and broaden Australia’s appeal.

Highlights and results

> In conjunction with the Australian High Commission and Australian

Trade Commission, Tourism Australia organised Celebrate Australia

2005, a month-long promotion showcasing Australian culture,

lifestyle and creativity. A total of 22 consumer events were staged,

and more than one million Singaporeans visited the Australia Brand

Showcase at Raffles City Shopping Centre. The Celebrate Australia

promotion won the silver award for Best Event Marketing at the

2005 Promotion Marketing Asia Pacific Awards.

> The ‘Australia. A Different Light’ campaign was launched, with brand

tracking results showing that Australia’s brand salience and appeal

improved significantly. Australia is now the top ranked destination in

terms of preference, consideration and aspiration in Singapore.

> A total of 130 Aussie Specialist agents were registered as at June

2005. Seventy two were fully qualified Aussie Specialists, a 20 per

cent increase over the previous year.

> Tourism Australia and State and Territory Tourism Organisations

jointly produced Wish You Were Here – a nine-episode travelogue for

Singapore’s highest-rating English television channel, MediaCorp’s

Channel 5. Extensive print and broadcast coverage was generated

by this program, with an equivalent advertising value of around

$AUD10.5 million.

> 10 print and two broadcast media visits to Australia, hosting

25 journalists, were conducted in 2004/05. These visits generated

144 media stories, a 66 per cent increase over 2003/04.

> Tourism Australia organised its first seminar aimed at schools

and education specialists to raise awareness of unique Australian

experiences and increase Australia’s share of the growing

educational and study tour segment.

TAIWAN

OVERVIEW

The outbound market in Taiwan remained steady in 2004/05. Arrivals reached 103,800 which were on par with

2003/04. However, the six months to June 2005 saw an increase of 10 per cent over the same period of the

previous year.

Australia remained a popular incentive destination and Tourism Australia activities focused on further growing

this key segment.

Highlights and results

> There was an unprecedented 660 per cent growth in the number of agents registering in the Aussie Specialist

Program (ASP) and a 244 per cent growth in the number of agents completing the training modules. There are

currently 165 agents from 38 agencies registered and 40 Aussie Specialists from 12 agencies have completed

the ASP training modules.

> Marketing activities aimed at the incentive sector generated five major pieces of confirmed business with a

total of 5,650 passengers. Several smaller pieces of confirmed business accounted for 1,340 visitors.

> Four corporates and six agents participated in the Team Australia Business Events Educational (TABEE) and six

agents attended Dreamtime. Thirteen delegates from 12 agencies attended the Australian Tourism Exchange

in Perth along with journalists from TTN Taiwan and World Travel Weekly.

> As part of the Visiting Journalists Program ( VJP), coverage was generated in major publications including

AZ Fashion Travel and Apple Daily.

THAILAND

OVERVIEW

Thailand continued to show consistent growth with a total of 79,300 visitors arriving in Australia in 2004/05.

This represented a one per cent increase over 2003/04.

Highlights and results

> The Aussie Promotion – a consumer print campaign to help raise awareness of Aussie Specialist agents and

new Australian products – resulted in increased traffic to australia.com with 1,200 bookings taken and more

than 3,000 enquires directed to Aussie Specialist agents.

> Tourism Australia helped to secure business from a number of incentive groups including American

International Assurance that sent 3,000 passengers to Sydney in 2004/05.

> The Aussie Specialist Program (ASP) now has 52 companies and 84 qualified agents. Thirty-three agents

participated in the ASP familiarisation in 2004/05.

> Fourteen delegates attended the Australian Tourism Exchange ( ATE) in Perth, six agents attended

Dreamtime and five agents attended the Team Australia Business Events Educational.

> Five print media participated in Tourism Australia’s trade events generating publicity to the value of

around $AUD345,000.

62 63


Japan

OVERVIEW

Japan is one of Australia’s top inbound tourism markets, recording a

total of 700,800 visitors during 2004/05, an increase of two per cent

over 2003/04. It was also the second largest market in terms of real

economic value in 2004, generating $2.06 billion in revenue.

This travel market is changing rapidly from mainstay package tours

to fully independent travel (FIT) and experience-driven travel. To

capitalise on this significant change, the Japanese travel industry has

adopted a more aggressive approach to direct consumer marketing

and online distribution.

The Japanese outbound market continues to improve and is

increasingly competitive in the New 50s/Silvers (Jukunen)

segment. Tourism Australia’s change in marketing focus from

Young Office Ladies (YOLs) to Office Ladies (OLs) and Honeymooners

segments continued, as did Tourism Australia’s focus on school

excursion programs.

Increased capacity and promotional activity by both Japan Airlines and

Qantas provided more co-operative marketing opportunities.

Highlights and results

> The ‘Australia. A Different Light’ brand campaign was launched

in April 2005. A TV ad featuring Delta Goodrem aired in four key

regional markets and was supported by print advertising and online

activities. According to tracking results, demand rose from 14 per

cent in April to 21 per cent in June.

> The Tourism Australia/ Japan Airlines’ Slow Stay Australia

campaign reflected the new Brand Australia. It was the first

time the Japanese national carrier used destination branding

in its advertising. The campaign featured in major national

magazines, train station posters, and online promotions. In June

the campaign shifted to focus on the fast emerging FIT market

by using innovative mobile phone technology that enabled

consumers to access a dedicated website.

> A co-operative brand campaign with Qantas ran from March 2005

and included print ads in major newspapers as well as outdoor

and transit advertising. A total of 2,089 Apex fares were booked

by Qantas from April to June, an increase of 18 per cent over the

same period of the previous year and 7,000 requests for Tourism

Australia’s travellers guide were received, the highest level recorded

from a brand campaign in this market.

> A new community site My Style Australia on australia.com was

launched in October 2004, targeting women in their 20s and 30s.

The objective was to build the intention to travel to Australia

by sharing consumers’ experiences. Following the launch, site

usage dramatically increased, reaching a record high in May

2005 of 991,141 page views, a 167 per cent increase compared to

September 2004.

> Tourism Australia launched the refreshed Brand Australia in

Japan in April 2005. More than 70 media and 100 key industry

partners attended the event. A highlight of the event included

the screening of a video featuring Japanese celebrities such as

NASA Astronaut Mamoru Mohri speaking about their favourite

Australian experiences.

> In November 2004, Tourism Australia and the Northern Territory

Tourist Commission (NTTC) hosted key members of the Japan

Australia Advisory Group (JAAG) to the Territory. JAAG members

are the chief executives from leading Japanese travel companies,

and are responsible for selling more than 70 per cent of all travel

from Japan to Australia. The success of the tour strengthened both

parties’ commitment to build outbound travel to Australia and

achieve Tourism Australia’s aim of one million Japanese visitors

annually by 2010. The Japan Association of Travel Agents (JATA) has

launched a similar program aimed at achieving 20 million outbound

travellers from Japan by 2007. Tourism Australia is working with JATA

to achieve this goal.

> The Visiting Journalists Program ( VJP) produced 105 print and

television articles. The estimated editorial coverage is valued at over

$AUD95.5 million. A highlight was the publication of a 124-page

magazine FIGARO Voyage Australia. The magazine, supported by

Japan Airlines, was a special edition of Japan’s popular lifestyle

publication FIGARO which has a circulation of 50,000 copies, and had

a publicity value of approximately $AUD1.1 million.

64 65


Gulf Countries

New Zealand

OVERVIEW

Tourism Australia activity in the Middle East is concentrated in the Gulf

Co-operative Council (GCC) countries of Bahrain, Kuwait, Oman, Qatar,

Kingdom of Saudi Arabia and the United Arab Emirates. Other Middle East

countries continue to be serviced through the Aussie Enthusiast Program

which is a joint initiative between Tourism Australia and Austrade.

Over the past twelve months Australia received 35,820 visitors from this

region, an increase of 20 per cent compared with 2003/04. The largest

number of travellers came from the United Arab Emirates and the Kingdom

of Saudi Arabia.

A key objective for 2004/05 was to continue building awareness of Australia

as a desirable long-haul travel destination by profiling Australian products to

enhance Australia’s unique attractions.

During the year Tourism Australia worked closely with the travel trade

throughout the Gulf Countries to stimulate travel to Australia. The

appointment of a Dubai-based Sales Manager to service the needs of travel

agents enhanced activities within this burgeoning market.

Highlights and results

> A major billboard campaign was undertaken over a two-month period in

Bahrain, Kuwait, Dubai, KSA and Qatar. A substantial newsprint campaign

was also undertaken in these markets, and Australia was featured as a liftout

supplement in six key publications.

> In conjunction with STO’s and airlines, Tourism Australia hosted the

inaugural travel agents’ training workshop, Yinala. The event was attended

by over 60 agents from across the Gulf region and 28 Australian suppliers.

The event was designed to educate travel agents about Australia,

introducing agents to new experiences and destinations.

> More than 500 travel agents attended roadshows in Kuwait, Bahrain, Doha,

Abu Dhabi and Muscat with eighteen Australian product suppliers providing

training opportunities.

> Tourism Australia in partnership with other State Tourism Organisations,

Qantas and 18 Australian suppliers attended the Arabian Travel Market

(ATM) from 3-6 May 2005. The event was visited by over 17,000 people,

including 7,000 trade visitors and over 8,000 consumers.

> Over 35,000 English and Arabic Travellers’ Guides were distributed to

consumers and travel agents. This was the first time Tourism Australia

produced the publication in Arabic.

> A range of Australia-branded marketing material has been produced to

support travel agents throughout the Gulf Countries.

OVERVIEW

Australia continues to hold a strong share of New Zealand’s outbound

travel, with 51 per cent of the total market.

The three main sources of travel to Australia came from Auckland,

Wellington and Canterbury, with the largest participation coming

from the 30-49 age group (22 per cent).

Visitors from New Zealand totalled 1.08 million in 2004/05, an

increase of nearly 17 per cent on 2003/04. This important market

was ranked fourth overall in spend, with over $AUD1.7 billion of real

economic benefit realised.

With more carriers servicing the Tasman, capacity increased to

280,000 seats. This, combined with load factors averaging 70 per cent,

strongly facilitated consumer travel to Australia.

Highlights and results

> Australia’s brand position in New Zealand is very strong with high

levels of awareness (65 per cent) and intention (20 per cent). Nearly

half of all New Zealanders indicate that Australia is a place that they

would go to in the next two years, placing Australia well ahead of its

nearest competitors.

> Tourism Australia’s Marvellous Deals to Australia co-operative

campaign was launched on 15 May 2005. The campaign was

developed in partnership with Qantas and involved a $NZ500,000

spend via print and radio mediums. The campaign focused on

‘gateway and beyond’ destinations and yielded 56,410 room nights,

an increase of nine per cent compared to the 2004 Discover Australia

Now campaign, which generated 51,711 room nights.

> Oztalk, New Zealand’s annual retail training program, was held in

Auckland from 31 March to 2 April 2005. In total, 328 agents and

225 products participated in the two-day tradeshow.

> A total of 15 media from New Zealand travelled to Australia with

the Visiting Journalists Program ( VJP) in 2004/05. Total VJP publicity

tracked during this period reached $AUD6 million.

> The new brand campaign, ‘Australia. A Different Light’, was launched,

generating significant media coverage.

66 67


UK & Europe

FRANCE

OVERVIEW

France generated $AUD283 million in total expenditure to Australia in 2004.

The introduction of the Working Holiday Maker (WHM) visa in early 2004 was

an important driver for the youth market in France and was a key area of focus

for activity during the financial year.

Tourism Australia identified three key segments for the French market:

Youth, Active Explorers and Business Tourism.

A key strategy for 2004/05 was to capitalise on Australia’s brand

communication activity to strengthen Australia’s competitive brand

position in France.

Highlights and results

> France’s main campaign ran in March and April 2005 in press, online and

outdoor media. This included full-page colour ads in youth and student

press. The campaign’s main call to action was australia.com, recording a

total of 175,892 hits.

> The WHM visa campaign effectively targeted the youth market with

innovative media that engaged them throughout their daily routine –

online at home/university; press in youth magazines; outdoor in

university campuses; and ambient in bars/cafes.

> In order to best penetrate a crowded marketplace, there was tactical use

of innovative media on bistro tables, beer mats and posters in universities

throughout France. The campaign established the WHM visa as the key

to turn desire into action and a dedicated banner on the home page of

australia.com was accessed 29,065 times. Traffic to the French section of

australia.com increased by 50 per cent during the campaign period.

> Tourism Australia and Qantas ran a co-operative campaign in February and

March 2005 and used a mix of radio, press and online media. This campaign

drove consumers from preference to intention to travel to Australia, with

Qantas reporting a significant increase in bookings.

> By the end of the financial year there were 222 qualified Aussie Specialist

agents, and a total of 25 agent training sessions attracted 1,103 participants.

> French consumers’ love of Aboriginal culture was enhanced by creative press

and online imagery, and Aboriginal music on radio.

GERMANY/ SWITZERLAND

OVERVIEW

The German market was Australia’s second most lucrative European market in

2004/05 generating $AUD878 million in total visitor expenditure.

There were limited signs of general economic recovery in Germany, yet growth

in the travel sector expanded at a far greater rate. Germany remained Europe’s

number one tourist generator of outbound travel with over 45 million trips

made in 2004.

German visitors to Australia have a comparatively high yield with a higher

than average length of stay. This supports the strategic focus of encouraging

growth by channelling activities through two leading market segments: Self-

Challengers, and Comfort and Learning.

The launch of the new Brand Australia included a major advertising campaign

around the proposition of ‘Australia, a twist on the expected’. The challenge

was to strengthen the emotional appeal by reframing perceptions of Australia.

Co-operative campaigns succeeded in raising the sense of urgency and

improved levels of conversion.

The relocation of the Tourism Australia and State and Territory Tourism

Organisations teams in Frankfurt and Munich helped unite efforts under a

consolidated Destination Australia Partnership banner.

Highlights and results

> australia.com remained the main call to action for Tourism Australia

campaigns, recording a total of 312,102 sessions for the fiscal year with

traffic rising by 18 per cent during 2004.

> The marketing objective of increasing awareness and strengthening the

emotional appeal of Australia was achieved. Brand tracking results indicated

that 58 per cent of those surveyed recalled the overall campaign, 73 per cent

thought about or discussed a holiday to Australia and 51 per cent actively

sought further information.

> Advertising on IMAX cinema was conducted, dramatising the breadth and

scale of Australia’s unique landscapes. Outdoor advertising on giant banners

was also used.

> Relationships were developed with the trade through familiarisation trips

with a total of 187 participants and training sessions at six events with a

total of 1,450 participants. By the end of the financial year there were 1,273

qualified Aussie Specialist agents in Germany.

> On average, 41 articles per month were generated in leading publications,

such as the six-page advertorial Taste the Difference of Australia with Wolf

Blass and Singapore Airlines.

> In January 2005, Australia was featured on Reisezeit, a primetime breakfast

program in Germany, Switzerland and Austria with an audience of 6.83

million viewers. As a result, 20,000 consumers entered competitions, which

were the main call to action of the coverage.

> In November 2004, Switzerland’s only travel program, Einfach Luxuriös (Simply

Luxurious) featured Tasmania in a 50 minute segment. The program was

viewed by around 700,000 people and had a media value of $AUD800,000.

68 69


UK & Europe

ITALY

OVERVIEW

Australia continues to hold strong appeal amongst Italians, with

one in five potential travellers listing Australia as a preferred

holiday destination.

Italy had the third highest average expenditure per person

($AUD6,488) and visitor spend from Italy totalled $AUD294 million in

2004. The majority (67 per cent) of visitors were travelling to Australia

for the first time, compared to the European average of 53 per cent.

Tourism Australia continued to pursue three key segments in the

Italian market: Active Independents (Young and Older), Active Youth

and Honeymoon. Over the last six years, Italian honeymooners have

been Europe’s largest travellers, averaging around 5,583 trips per year.

Tourism Australia increased its focus on the Italian market between

2003/04 and 2004/05, injecting additional funds to revitalise the

market through increased activity. Italy continued to offer good

potential as the world’s fifth largest outbound tourist-generating

market (all destinations).

Highlights and results

> australia.com remained the main call to action for Tourism Australia

campaigns, recording a total of 130,776 sessions for this fiscal year.

> The launch of the new Aussie Specialist Program (ASP) site in March

2004 was a key milestone in the training of agents throughout

Italy. By the end of the financial year there were 177 qualified ASP

agents. In addition a total of six training sessions were held with 375

participants.

> The Brand Australia advertisement featuring Delta Goodrem was

shown in open-air cinemas. Brand tracking revealed that 11 per cent

of total respondents had seen this ad, an excellent result considering

it was only shown in cinemas. Brand advertising also featured in

magazines, online, on billboards (in Milan) and on the outside of

Jumbotrams (in Rome).

> Tourism Australia also ran two co-operative campaigns with

Qantas and Singapore Airlines. Both involved online and radio

advertisements, generating additional bookings to Australia.

> Several key pieces of media coverage were generated through the

Visiting Journalists Program ( VJP). Two highlights saw Australia

featured in dedicated issues of Qui Touring (circulation 431,648) and

Condé Nast Traveller (circulation 56,457).

NORDIC & NETHERLANDS

OVERVIEW

In 2004, visitors from the Nordic region (primarily Sweden and

Denmark) achieved a total expenditure of $AUD477 million, and the

Netherlands $AUD259 million. The Netherlands continued to be the

world’s number one market for dispersal in Australia with 56 per cent

of nights spent outside of major gateways.

The strategy for these regions was to offer support for industry

initiatives. This was primarily channelled through the distribution

system and by implementing a successful public relations strategy,

while online methods were an effective way to target the market.

For both regions the key target segments were Young Independents

and Backpackers reflecting both the high percentage of visitors aged

from 15 to 24 years and the popularity of the Working Holiday Maker

(WHM) visa scheme.

Highlights and results

> In the Nordic Region, Tourism Australia supported five consumer

publications and two travel trade publications on the Visiting

Journalists Program ( VJP). Contacts were also re-established with a

range of travel and lifestyle media in both Sweden and Denmark.

> In the Netherlands the VJP supported a series of six programs

filmed in South Australia and the Northern Territory, for the

popular television series Wie is de Mol. Another VJP highlight was

four features running on Yorin Travel TV with coverage of Western

Australia and the Northern Territory.

> A highly successful online advertising campaign ran in the

Netherlands, with the aim of increasing awareness of the WHM

visa while driving responses to a micro site on australia.com. This

included media placements on google.com and msn.com and

web layer ads on key youth websites. These initiatives collectively

recorded over 1.5 million impressions.

> 26 agent training sessions were conducted across the region

reaching 790 participants. 152 travel agents successfully completed

the Aussie Specialist Program.

70 71


UK & Europe

UK & IRELAND

OVERVIEW

The United Kingdom ( UK) continued to be Australia’s best performing

long-haul market, generating $AUD3,438 million in 2004. Marketing

campaigns were successfully launched across a broad range of media,

recording excellent exposure and enquiry numbers. These initiatives

were well-received by the industry and were reinforced through a

comprehensive agent training program.

Many milestones were achieved in the UK and Ireland during

2004/05 with new initiatives undertaken and high standards

established for the future. A new collective approach was reflected

in the Destination Australia Partnership (DAP), which united Tourism

Australia and State Tourist Offices to maximise effectiveness in

marketing the new Brand Australia.

Tourism Australia also secured widely visible media coverage, a high

rate of consumer response and strong industry satisfaction.

Highlights and results

> The Destination Australia Partnership (DAP) was moved to one

central office, in December 2004. The new DAP formation involved

establishing new departments and functions and marked a key

milestone in the global promotion of Australia.

> australia.com remained the main call to action for Tourism Australia

campaigns, recording a total of 680,957 sessions for the fiscal year

(661,018 for UK, 19,939 for Ireland). While traffic for 2004 was

similar to levels in 2003, the first three months of 2005 saw a 25 per

cent increase on the same period in the previous year.

> The Partnership Development Program continued to endorse trade

relationships by hosting 12 familiarisation trips (11 in UK, 1 in

Ireland) which attracted 256 participants (241 in UK, 15 for Ireland).

An unprecedented 13 new tour operators and 19 Aussie Specialists

were escorted to Australian Tourism Exchange ( ATE) 2005. The

relaunch of an improved ASP site enabled more online interactions

and provided training for a total of 2,286 agents (1,843 in UK, 443 in

Ireland) during the year.

> On average, 54 media articles per month were generated, and an

advertorial was secured in Condé Nast Traveller featuring the Taste

Australia event in partnership with Turquoise Holidays.

> Tourism Australia’s advertising campaign in the UK ran from

September 2004 to January 2005, featuring the Delta Goodrem

advertisement across television, cinema, outdoor, radio and press.

Advertising via cinema gave Tourism Australia a unique marketing

opportunity as no other tourism organisation had advertised using

this medium over the past 12 months. The campaign focused on the

key segments of Self Challengers and Comfort Adventurers.

> The Delta Goodrem television advertisement achieved a 62 per cent

recognition rate. Tourism Australia’s brand tracking indicated that 85 per

cent of responses recalled the campaign in detail, 60 per cent discussed

and thought about travelling to Australia and 42 per cent actively sought

information through channels such as australia.com.

> A series of effective co-operative campaigns with key airline partners

continued during 2004/05. The Qantas campaigns worked to convert strong

desire to travel into bookings.

> Tourism Australia commissioned celebrity photographer Rankin, to capture

the spirit of Australia in a photographic exhibition in central London.

Singapore Airlines co-sponsored the exhibition, which was launched at Sony

Ericsson Proud Galleries, on 25 January 2005. The Australia Day launch was

attended by Rankin, UK media, the Minister for Small Business and Tourism

the Hon Fran Bailey, and other high-profile guests including singer Delta

Goodrem and chef Ben O’Donaghue.

> The Rankin exhibition was recreated along the travellators at Waterloo

underground station reaching an additional 546,000 people. An online

gallery was set up at australia.com, attracting a further 7,829 visitors. The

coverage from this campaign reached an estimated 8,309,628 people with

an equivalent advertising value of £434,776.

> BBC Holiday visited Australia as part of the Visiting Journalists Program

( VJP) in November 2004. The group travelled from Perth to Sydney taking

in Kalgoorlie, Coober Pedy, Adelaide and Echuca. The visit resulted in two

segments of seven minutes which were broadcast in early February to 4.5

million viewers. The estimated publicity value from these broadcasts was

£1.3 million.

> Tourism Australia supported a visit by GMTV in January 2005 which

generated two, ten minute films featuring Sydney and Byron Bay. The films

were presented by Duncan James from the hugely popular boy band Blue

and were broadcast to an audience of 11 million in March 2005. GMTV is the

UK’s leading breakfast program featuring a mix of news, lifestyle, current

affairs features and celebrity interviews.

> Tourism Australia’s UK operation was voted the best National Tourism Office

in the Travel Trade Gazette Awards, a testament to its professionalism and

the consolidated approach of the UK team.

72 73


FINANCIAL REPORT


The audit opinion is formed on the basis of these procedures, which included:

> examining, on a test basis, information to provide evidence supporting the amounts and disclosures in the

financial statements; and

Independent audit report

To the Minister for Small Business and Tourism

SCOPE

The financial statements and directors’ responsibility

The financial statements comprise:

> Statement by Director;

> Statements of Financial Performance, Financial Position and Cash Flows;

> Schedules of Commitments and Contingencies; and

> Notes to and forming part of the Financial Statements

of Tourism Australia for the year ended 30 June 2005.

The directors of Tourism Australia are responsible for preparing the financial statements that give a true

and fair view of the financial position and performance of Tourism Australia, and that comply with Finance

Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997, accounting standards

and other mandatory financial reporting requirements in Australia. The directors of Tourism Australia are also

responsible for the maintenance of adequate accounting records and internal controls that are designed to

prevent and detect fraud and error, and for the accounting policies and accounting estimates inherent in the

financial statements.

AUDIT APPROACH

I have conducted an independent audit of the financial statements in order to express an opinion on them

to you. My audit has been conducted in accordance with the Australian National Audit Office Auditing

Standards, which incorporate the Australian Auditing and Assurance Standards, in order to provide

reasonable assurance as to whether the financial statements are free of material misstatement. The

nature of an audit is influenced by factors such as the use of professional judgement, selective testing,

the inherent limitations of internal control, and the availability of persuasive, rather than conclusive,

evidence. Therefore, an audit cannot guarantee that all material misstatements have been detected.

While the effectiveness of management’s internal controls over financial reporting was considered

when determining the nature and extent of audit procedures, the audit was not designed to provide

assurance on internal controls.

I have performed procedures to assess whether, in all material respects, the financial statements present

fairly, in accordance with Finance Minister’s Orders made under the Commonwealth Authorities and

Companies Act 1997, accounting standards and other mandatory financial reporting requirements in

Australia, a view which is consistent with my understanding of Tourism Australia’s financial position,

and of its performance as represented by the statements of financial performance and cash flows.

> assessing the appropriateness of the accounting policies and disclosures used, and the reasonableness of

significant accounting estimates made.

INDEPENDENCE

In conducting the audit, I have followed the independence requirements of the Australian National

Audit Office, which incorporate the ethical requirement of the Australian accounting profession.

AUDIT OPINION

In my opinion, the financial statements of Tourism Australia:

(a) have been prepared in accordance with the Finance Minister’s Orders made under the Commonwealth

Authorities and Companies Act 1997; and

(b) give a true and fair view of Tourism Australia’s financial position as at 30 June 2005, and its performance and

cash flows for the year then ended, in accordance with:

(i) the matters required by the Finance Minister’s Orders; and

(ii) applicable accounting standards and other mandatory financial reporting requirements in Australia.

Australian National Audit Office

P Hinchey

Senior Director

Delegate of the Auditor-General

Sydney

12 August 2005

76 77


Tourism Australia

STATEMENT BY DIRECTORS

In our opinion, the attached financial statements for the year ended 30 June 2005 are based on

properly maintained financial records and give a true and fair view of the matters required by the

Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997.

We are also satisfied that Tourism Australia has in place appropriate fraud control mechanisms

that meet the needs of Tourism Australia and comply with Australian Government guidelines

for this financial year, including annual report requirements.

In our opinion, at the date of this statement, there are reasonable grounds to believe that

Tourism Australia will be able to pay its debts as and when they become due and payable.

Tim Fischer

Scott Morrison

Chairman Managing Director

12 August 2005 12 August 2005

STATEMENT OF FINANCIAL PERFORMANCE

For the year ended 30 June 2005

REVENUE

Notes

2005

$’000

Revenue from ordinary activities

Revenue from Government 4a 138,374

Advertising 4b 10,781

Goods and Services 4c 1,515

Contributions 4d 13,546

Interest 4e 3,455

Net foreign exchange gains 4f 958

Revenue from sale of assets 4g 45

Other Revenues 4h 1,128

Revenue from ordinary activities 169,802

EXPENSE

Expenses for ordinary activities

Employees 5a 27,904

Suppliers 5b 130,595

Depreciation and amortisation 5c 1,443

Write-down of assets 5d 136

Value of assets sold 4g 380

Other Expenses 5e 5,027

Expenses from ordinary activities 165,485

Net profit 4,317

Net credit/(debit) to asset revaluation reserve 53

Total revenues, expenses and valuation adjustments recognised directly in equity 53

Total changes in equity other than those resulting from

transactions with the Australian Government as owner 4,370

The above statement should be read in conjunction with the accompanying notes.

78 79


STATEMENT OF FINANCIAL POSITION

As at 30 June 2005

ASSETS

Notes

2005

$’000

Financial assets

Cash 6a 16,768

Receivables 6b 8,348

Other 6c 2,141

Inventories 6d 149

Total financial assets 27,406

Non-financial assets

Investments 6e 110

Plant and equipment 7a & b 1,606

Intangibles 7a & b 3,978

Total non-financial assets 5,694

Total assets 33,100

LIABILITIES

Provisions

Employees 8a 4,569

Total provisions 4,569

Payables

Suppliers 8b 13,388

Other payables 8c 1,059

Total payables 14,447

Total liabilities 19,016

Net assets 14,084

EQUITY

Parent entity interest

Contributed equity 9 827

Reserves 9 684

Accumulated surplus 9 12,573

Total equity 14,084

Current assets 27,406

Non-current assets 5,694

Current liabilities 17,751

Non-current liabilities 1,265

STATEMENT OF CASH FLOWS

For the year ended 30 June 2005

OPERATING ACTIVITIES

Notes

2005

$’000

Cash received

Goods and services 22,835

Appropriations 138,374

Interest 3,077

Total cash received 164,286

Cash used

Employees (26,993)

Suppliers (125,804)

Other (5,027)

GST paid to ATO (63)

Total cash used (157,887)

Net cash from operating activities 10a 6,399

INVESTING ACTIVITIES

Cash received

Proceeds from sales of property, plant and equipment 45

Total cash received 45

Cash used

Purchase of property, plant and equipment (954)

Purchase of software and intangibles (2,562)

Total cash used (3,516)

Net cash (used by) investing activities (3,471)

FINANCING ACTIVITIES

Cash Received

Appropriation – Contributed equity 549

Total cash received 549

Net cash from financing activities 549

Net increase in cash held 3,477

Cash at the beginning of the reporting period 12,333

Effects of exchange rate changes on cash 958

Cash at the end of the reporting period 10b 16,768

The above statement should be read in conjunction with the accompanying notes.

The above statement should be read in conjunction with the accompanying notes.

80 81


SCHEDULE OF COMMITMENTS

As at 30 June 2005

2005

Notes $’000

BY TYPE

Other commitments

Operating leases 1 19,724

Other commitments 2 28,916

Total other commitments 48,640

SCHEDULE OF CONTINGENCIES

As at 30 June 2005

There were no known contingencies as at 30 June, 2005.

The above schedule should be read in conjunction with the accompanying notes.

Commitments receivable 3 (330)

Net commitments 48,310

BY MATURITY

Operating lease commitments

One year or less 4,846

From one to five years 10,874

Over five years 4,004

Total operating lease commitments 19,724

Other Commitments

One year or less 17,873

From one to five years 11,043

Total other commitments 28,916

Commitments receivable 3 (330)

Net commitments 48,310

NB: Commitments are GST inclusive where relevant.

1 Operating leases comprise leases for office accommodation and computer leases.

2 Other commitments comprise amounts payable under project agreements in respect of which the

recipient is yet to either perform the services required or meet eligibility conditions.

3 Commitments receivable comprises GST recoverable.

The above schedule should be read in conjunction with the accompanying notes.

82 83


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

Note Description Page

1 Summary of significant accounting policies 85

2 Adoption of Australian Equivalents to International Financial Reporting Standards from 2005-2006 92

3 Economic dependency 94

4 Operating revenues 95

5 Operating expenses 97

6 Financial assets 98

7 Non-financial assets 101

8 Provisions and payables 103

9 Equity 104

10 Cash flow reconciliation 105

11 Directors’ remuneration 106

12 Remuneration of officers 107

13 Remuneration of auditors 107

14 Average staffing levels 107

15 Financial instruments 108

16 Contingent liabilities and assets 111

17 Reporting of outcomes 111

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 1 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

1.1 ESTABLISHMENT OF TOURISM AUSTRALIA

Tourism Australia (TA) was established under section 5 of the Tourism Australia Act 2004 (the TA Act)

on 1 July 2004.

TA brings together the Australian Tourist Commission (the ATC), the domestic marketing body See Australia,

the Bureau of Tourism Research (BTR), and the Tourism Forecasting Council (TFC).

All business functions and operations of the above entities continued without interruption under

the umbrella of TA.

The Australian Tourist Commission Act 1987 was repealed under section 5 of the Tourism Australia (Repeal and

Transitional Provisions) Act 2004 (the Transitional Provisions Act). The Transitional Provisions Act also makes

TA the legal successor to the above entities, excluding See Australia in relation to all of their assets, liabilities,

contracts and employees.

Transfer of assets and liabilities

Part 3 Section 6 (2) of the Transitional Provisions Act states, on the proclamation day:

(a) the assets and liabilities cease to be assets and liabilities of the ATC and become assets and liabilities

of TA without any conveyance, transfer or assignment; and

(b) TA becomes the ATC’s successor in law in relation to the assets and liabilities immediately after they

become assets and liabilities of Tourism Australia.

Part 4 of the Transitional Provisions Act states that assets and liabilities of BTR become assets and liabilities

of TA under a declaration in writing by the Minister.

Part 5 of the Transitional Provisions Act states that assets and liabilities of TFC become assets and liabilities

of TA under a declaration in writing by the Minister.

Transfer of staff

Section 12 of the Transitional Provisions Act provides that each person employed under section 42 of the

Australian Tourist Commission Act 1987 immediately before the proclamation day ceases to be employed by

the ATC on the proclamation day and is taken to have been engaged as an employee of Tourism Australia under

section 55 of the Tourism Australia Act 2004 on that day. There is no specific provision for transfer of staff of the

other entities.

1.2 COMPARATIVE FIGURES

As TA was established on 1 July 2004 under the Tourism Australia Act 2004, there are no comparative

figures available.

84 85


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

1.3 BASIS OF ACCOUNTING

The financial statements are required by clause 1 (b) of Schedule 1 to the Commonwealth Authorities

and Companies Act 1997 and are a general purpose financial report.

The statements have been prepared in accordance with:

> Finance Minister’s Orders (being the Commonwealth Authorities and Companies (Financial Statements

for reporting periods ending on or after 30 June 2005);

> Australian Accounting Standards and Accounting Interpretations issued by the Australian Accounting

Standards Board; and

> Consensus Views of the Urgent Issues Group.

The Statements of Financial Performance and Financial Position have been prepared on an accrual basis and are

in accordance with historical cost convention, except for certain assets which, as noted, are at valuation. Except

where stated, no allowance is made for the effect of changing prices on the results or the financial position.

Assets and liabilities are recognised in the Statement of Financial Position when and only when it is probable

that future economic benefits will flow and the amounts of the assets or liabilities can be reliably measured.

Revenues and expenses are recognised in the Statement of Financial Performance when and only when

the flow or consumption or loss of economic benefits has occurred and can be reliably measured.

1.4 REPORTING BY OUTCOMES

The actual figures by outcome specified in the Appropriation Acts relevant to TA are presented

in Note 17. Any intra-government costs included in the figure ‘net cost to Budget outcomes’

are eliminated in calculating the actual budget outcome for the Government overall.

1.5 REVENUE

The revenues described in this Note are revenues relating to core operating activities.

Revenue from the sale of goods is recognised upon the delivery of goods to the customers.

Interest revenue is recognised on a time proportionate basis that takes into account the effective yield

on the relevant asset.

Revenue from the disposal of non-current assets is recognised when control of the assets has passed

to the buyer.

Revenue from rendering of services is recognised by reference to the stage of completion

of contracts to provide the service. The stage of completion is determined according to the

proportion that costs incurred to date bear to the estimated total costs of the transaction.

Revenue from Government – Output Appropriations

The full amount of the appropriation for departmental outputs for the year is recognised as revenue.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

Resources Received Free of Charge

Any services received free of charge are recognised as revenue when and only when a fair value can be

reliably determined and the services would have been purchased if they had not been donated. Use of

those resources is recognised as an expense.

Contributions of assets at no cost of acquisition or for nominal consideration are recognised at their

fair value when the asset qualifies for recognition.

1.6 TRANSACTIONS BY THE GOVERNMENT AS OWNER

Equity Injections

Amounts appropriated by the Parliament as equity injections are recognised as

‘contributed equity’ in accordance with the Finance Minister’s Orders.

1.7 EMPLOYEE BENEFITS

Benefits

Liabilities for services rendered by employees are recognised at the reporting date to the extent that

they have not been settled.

Liabilities for wages and salaries (including non-monetary benefits) and annual leave are

measured at their nominal amounts. Other employee benefits expected to be settled within

12 months of the reporting date are also measured at their nominal amounts.

The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

All other employee benefit liabilities are measured as the present value of the estimated future cash

outflows to be made in respect of services provided by employees up to the reporting date.

Leave

The liability for employee benefits includes provision for annual leave and long service leave. No

provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken

in future years by employees is estimated to be less than the annual entitlement for sick leave.

The leave liabilities are calculated on the basis of employees’ remuneration, including employer

superannuation contribution rates to the extent that the leave is likely to be taken during service

rather than paid out on termination.

The liability for long service leave has been determined by reference to the present value of the estimated

future cash flows to be made in respect of all employees at 30 June 2005. The estimate of the present value

of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and redundancy

Provision is made for separation and redundancy benefit payments in cases where positions

have been formally identified as excess to requirements, and a reliable estimate of the

amount payable, which is consistent with local requirements, can be determined.

86 87


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

Superannuation

AUSTRALIA

Employees are members of the Commonwealth Superannuation Scheme and the Public Sector

Superannuation Scheme. The liability for their superannuation benefits is recognised in the financial

statements of the Australian Government and is settled by the Australian Government in due course.

TA made employer contributions to the Australian Government at rates determined by an actuary to be

sufficient to meet the cost to the Government of the superannuation entitlements of employees.

The liability for superannuation recognised as at 30 June represents outstanding contributions for

the final fortnight of the year.

The contribution rate for TA as a Group 2 Authority was 25.3 per cent – Commonwealth Superannuation

Scheme, 12.6 per cent – Public Sector Scheme, of salaries in 2004-05. In addition, TA remitted Employer

Productivity Superannuation Contributions to ComSuper for all employees. The contribution rate was

variable and banded according to earnings ranging from 2 per cent to 3 per cent of salaries in 2004/05.

ASIA

In accordance with local regulations TA provided superannuation for its locally engaged staff in

Hong Kong with HSBC Life (International) Ltd. The contribution rate was 11.5 per cent of salaries

in 2004/05 for staff that joined before 1 December, 2000. The contribution rate was 5 per cent

of salaries up to a maximum contribution of HK$1,000 per month in 2004/05 for those staff

who joined after 1 December, 2000 under the new mandatory provident fund regulations.

In Malaysia, TA provided superannuation for its locally engaged staff with the Employee

Provident Fund where the contribution rate was 12 per cent of salaries in 2004/05.

In Singapore, TA provided superannuation for its locally engaged staff with the Central Provident Fund where

the contribution rate was 13 per cent of salaries up to a salary ceiling of S$5,500 per month in 2004/05.

In Korea, TA provided superannuation for its locally engaged staff with funds run by National Pension.

The contribution rate was 4.5 per cent of salaries in 2004/05.

In Taiwan, TA provided superannuation for its locally engaged staff with HSBC Life (International) Ltd.

The contribution rate was 8 per cent of salaries in 2004/05.

In Thailand, superannuation is not mandatory; however TA did include 3 per cent in the staff’s salary.

Once superannuation does become mandatory, the 3 per cent will be contributed to the chosen body.

In China, TA provided superannuation for its locally engaged staff with the local official agency

FESCO. The monthly contribution was HKD 2,886 per staff member in 2004-05.

In Japan, TA accrued retirement benefit of 50 per cent of the latest monthly salary times

number of years of service for its locally engaged staff who joined before May 1999.

UNITED STATES

TA provided an optional employee retirement benefit for its locally engaged staff in Los Angeles with Mutual of

America. TA matched employees’ contributions up to a maximum of 3 per cent of gross salary in 2004/05 and

an annual limit of US$10,000 for employees less than 50 years of age. For employees who will be 50 years of

age or older, the limit is US$9,500 per annum. These limits include both employer and employee contributions.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

CANADA

TA provided an optional employee retirement benefit for its locally engaged staff in Canada with

Scotia Bank. TA matched employees’ contribution up to a maximum of 3 per cent of gross salary in 2004/05.

EUROPE

For the United Kingdom, in accordance with locally engaged terms and conditions of employment

TA provided a group personal pension scheme for its locally engaged staff in London with

Standard Life Assurance Co. The contribution rate was variable and banded according to

age and earnings ranging from 4 per cent to 20 per cent of salaries in 2004/05.

In Germany Tourism Australia contributed an inclusive social amount to the statutory

insurance government fund for its locally engaged staff; TA matched staff contributions

on a 1:1 basis. The contribution rate is not separately nominated.

NEW ZEALAND

In New Zealand, there was no superannuation contribution requirement for locally engaged staff.

1.8 LEASES

A distinction is made between finance leases and operating leases. Finance leases effectively transfer from

the lessor to the lessee substantially all the risks and benefits incidental to ownership of leased non-current

assets. In operating leases, the lessor effectively retains substantially all such risks and benefits.

TA has not entered into any finance leases.

Operating lease payments are expensed on a basis which is representative of the pattern of benefits

derived from the leased assets.

1.9 CASH

Where appropriate, monies not immediately required by TA were invested in an approved manner

in accordance with section 18 of the Commonwealth Authorities and Companies Act 1997.

Cash means notes and coins held and any deposits held at call with a bank or financial institution

and investments in money market instruments. Cash is recognised at its nominal amount. Interest

is credited to revenue as it accrues.

1.10 FINANCIAL INSTRUMENTS

Accounting policies for financial instruments are stated at note 15.

88 89


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

1.11 PROPERTY, PLANT AND EQUIPMENT

Asset recognition threshold

Purchases of property, plant and equipment are recognised initially at cost in the Statement of Financial

Position, except for purchases costing less than $5,000, which are expended in the year of acquisition

(other than where they form part of a group of similar items which are significant in total).

Revaluations

BASIS

Plant and equipment are carried at valuation, being revalued annually with sufficient

frequency such that the carrying amount of each asset class is not materially different, as at

reporting date, from its fair value. Valuations undertaken in any year are as at 30 June.

Fair values for each class of asset are determined as shown below:

Asset Class

Leasehold improvements

Plant and equipment

Fair Value measured at:

Depreciated replacement cost

Depreciated replacement cost

Assets that are surplus to requirement are measured at their net realisable value. At 30 June 2005 TA held no

surplus assets.

CONDUCT

All valuations are conducted by an independent qualified valuer.

DEPRECIATION

Depreciable property plant and equipment assets are written-off to their estimated residual

values over their estimated useful lives to TA using, in all cases, the straight-line method of

depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser

of the estimated useful life of the improvements or the unexpired period of the lease.

Depreciation/Amortisation rates (useful lives) and methods are reviewed at each reporting date

and necessary adjustments are recognised in the current, or current and future reporting periods, as

appropriate. Residual values are re-estimated for a change in prices only when assets are revalued.

Depreciation and amortisation rates applying to each class of depreciable asset are based on the following

useful lives:

2005

Leasehold improvements Lease term

Plant and equipment

3 to 10 years

The aggregate amount of depreciation and amortisation allocated for each class of asset during the reporting

period is disclosed in Note 5.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

Impairment of Non-Current Assets

Non-current assets carried at up-to-date fair value at the reporting date are not subject to impairment testing.

The non-current assets carried at cost, which are not held to generate net cash inflows, have been assessed

for indications of impairment. Where indications of impairment exist, the carrying amount of the asset is

compared to its net selling price and depreciated replacement cost and is written down to the higher of the two

amounts, if necessary.

1.12 INTANGIBLES

Intangibles comprise internally developed software and purchase of licensed software for internal use and

trade marks. These assets are carried at cost.

Software and trade marks are amortised on a straight-line basis over their anticipated useful lives. The useful

life of software is 2 to 5 years. The useful life of trade marks is 10 years.

All software assets were assessed for indications of impairment as at 30 June 2005.

1.13 TAXATION

TA was exempt from all forms of taxation except fringe benefits tax and the goods and services tax (GST).

Revenues, expenses and assets are recognised net of GST:

> except where the amount of GST incurred is not recoverable from the Australian Taxation Office; and

> except for receivables and payables.

TA was not subject to exemption from any foreign taxation laws relative to its overseas operations.

1.14 FOREIGN CURRENCY

Transactions denominated in a foreign currency are converted at the exchange rate at the date of the

transaction. Foreign currency receivables and payables are translated at the exchange rate current as at balance

date and any exchange differences are brought to account in the Statement of Financial Performance.

1.15 INSURANCE

TA is insured for risks through the Government’s insurable risk managed fund, called ‘Comcover’. Workers

compensation is insured through Comcare Australia.

1.16 ROUNDING

Amounts are rounded to the nearest $1,000 except in relation to the following:

> Remuneration of directors;

> Remuneration of officers (other than directors); and

> Remuneration of auditors.

90 91


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 2 ADOPTION OF AUSTRALIAN EQUIVALENTS TO INTERNATIONAL FINANCIAL

REPORTING STANDARDS FROM 2005-2006

The Australian Accounting Standards Board has issued replacement Australian Accounting

Standards to apply from 2005-06. The new standards are the Australian Equivalents to International

Financial Reporting Standards (AEIFRS). The International Financial Reporting Standards are

issued by the International Accounting Standards Board. The new standards cannot be adopted

early. The standards being replaced are to be withdrawn with effect from 2005-06, but continue

to apply in the meantime, including for reporting periods ending on 30 June 2005.

Accounting Standard AASB 1047 Disclosing the Impacts of Adopting Australian Equivalents to

International Financial Reporting Standards requires that the financial report for 2004-05 disclose:

> an explanation of how the transition to AEIFRS is being managed;

> narrative explanations of the key policy differences arising from the adoption of AEIFRS;

> any known or reliably estimable information about the impacts on the financial

report had it been prepared using the Australian equivalents to IFRS; and

> if the impacts of the above are not known or reliably estimable, a statement to that effect.

Where an entity is not able to make a reliable estimate, or where quantitative information

is not known, the entity should update the narrative disclosures of the key differences

in accounting policies that are expected to arise from the adoption of AEIFRS.

The purpose of this Note is to make these disclosures.

MANAGEMENT OF THE TRANSITION TO AEIFRS

TA has taken the following steps to prepare for the implementation of AEIFRS:

> TA’s Audit Committee is tasked with oversight of the transition to and implementation of AEIFRS.

The Chief Financial Officer is formally responsible for the project and reports regularly to the Audit

Committee on progress against the formal plan approved by the Committee.

> The plan requires the following key steps to be undertaken and sets deadlines for their achievement:

• All major accounting policy differences between current AASB standards and AEIFRS were identified

by 30 April 2005

• A transitional balance sheet as at 1 July 2004 under AEIFRS was completed and presented to the

Audit Committee

• An AEIFRS compliant balance sheet was also prepared during the preparation of the 2004-05

statutory financial reports; and

• The 2004-05 Balance Sheet under AEIFRS will be reported to the Department of Finance and

Administration in line with their reporting deadlines.

> The plan also addresses the risks to successful achievement of the above objectives and includes strategies

to keep implementation on track to meet deadlines.

> Consultants were engaged where necessary to assist with each of the above steps.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

MAJOR CHANGES IN ACCOUNTING POLICY

TA believes that the first financial report prepared under AEIFRS, i.e. at 30 June 2006, will be prepared on

the basis that TA will be a first-time adopter under AASB 1 First-time Adoption of Australian Equivalents

to International Financial Reporting Standards. Changes in accounting policies under AEIFRS are applied

retrospectively i.e. as if the new policy had always applied except in relation to the exemptions available

and prohibitions under AASB 1. This means that an AEIFRS-compliant balance sheet has to be prepared as

at 1 July 2004. This will enable the 2005-06 financial statements to report comparatives under AEIFRS.

A first-time adopter of AEIFRS may elect to use exemptions under paragraphs 13 to 25E. When developing

the accounting policies applicable to the preparation of the 1 July opening balance sheet, TA has elected

to employ the exemption available under Paragraph 16 of AASB 1. Paragraph 16 states that an entity

may elect to measure an item of property, plant and equipment at the date of transition to Australian

equivalents to IFRSs at its fair value and use that fair value as its deemed cost at that date.

Changes to major accounting policies are discussed in the following paragraphs.

Management’s review of the quantitative impacts of AEIFRS represents the best estimate of the impacts

of the changes as at reporting date. The annual effects of the impacts of AEIFRS may differ from these

estimates due to:

> continuing review of the impacts of AEIFRS on Tourism Australia operations;

> potential amendments to the AEIFRS and AEIFRS interpretations; and

> emerging interpretation as to the accepted practice in the application

of AEIFRS and the AEIFRS Interpretations.

Property, plant and equipment

It is expected that the 2005-06 Finance Minister’s Orders will continue to require property plant and equipment

assets to be valued at fair value in 2005-06. There is no capitalised borrowing costs related to qualifying assets.

Restoration costs of leasehold improvements (make good)

TA, under its lease agreements for various offices, has obligations to restore (make good) leasehold

improvements at the end of the lease terms. The obligations, however remote, must be recognised under

AIFRS as liabilities for the cost of restoration at the end of the terms (discounted to its net present value).

These are also initially recognised as part of the capitalised cost of the leasehold improvements and amortised

over the lease terms.

The impact of the increase in amortisation expenses (on the additional capitalised leasehold improvements)

and the increase as the net present value of the provision increases, recognised as a borrowing cost under

AIFRS, is as follows:

$’000

LIABILITIES

Initial capitalisation of provision for restoration costs 1,903

EQUITY – charge to Accumulated surpluses

Amortisation of leasehold improvements to 30 June 2005 227

NON-FINANCIAL ASSETS

Make good provision at 30 June 2005 1,676

92 93


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

Intangible Assets

Intangibles comprise internally developed software and purchase of licensed software for internal use

and trade marks. Intangibles have been carried at cost less depreciation and impairment losses in

accordance with AASB 138.

An assessment of the Intangible Assets has been completed with no adjustment to original cost.

Impairment of Intangibles and Property, Plant and Equipment

In accordance with AASB 136, non-current assets will be assessed for any impairment on an annual basis.

Computer hardware, software and trade marks are reviewed by TA managers for any impairment.

An impairment assessment of TA’s Intangible assets indicated that no adjustments will be required.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 4 OPERATING REVENUES

4a

4b

2005

REVENUES FROM GOVERNMENT

$’000

Appropriations for outputs 138,374

Total Revenues from Government 138,374

ADVERTISING

Advertising income 10,781

Inventory

TA recognises inventory not held for sale at cost, except where no longer required, in which case net realisable

value is applied.

The new AEIFRS standard AASB 102 will require inventories held for distribution to be carried at the lower of

cost or current replacement cost.

An assessment was made and it was found that in all instances the current replacement cost of

inventory was equal or greater than the written down value. Therefore no adjustment is required.

Employee Benefits

The provision for long service leave is measured at the present value of estimated future cash

outflows, using market yields as at the reporting date on national government bonds.

AEIFRS may require the market yield on corporate bonds to be sued. The AASB has decided that a deep market

in high quality corporate bonds does not exist and therefore national government bonds will be referenced.

AEIFRS also require that annual leave that is not expected to be taken within 12 months of balance date is

to be discounted. After assessing the staff leave profile, TA does not expect any material amounts of the

annual leave balance will not be taken in the next 12 months. Consequently, there are no adjustments for

non-current annual leave.

Financial Instruments

AEIFRS include an option for entities not to restate comparative information in respect of financial

instruments in the first AEIFRS report. It is expected that Finance Minister’s Orders will require

entities to use this option. Therefore, the amounts for financial instruments presented in TA’s 2004-

05 primary financial statements are not expected to change as a result of the adoption of AEIFRS.

TA will be required by AEFIRS to restate the carrying amount of financial instruments at 1 July

2005 to align with the accounting policies required by AEIFRS. It is expected that the carrying

amounts of most financial instruments held by TA will be unaffected by this requirement.

4c

4d

4e

SALES OF GOODS AND SERVICES

Goods 105

Services 1,410

Total sales of goods and services 1,515

Provision of goods to:

Related entities –

External entities 105

Total sales of goods 105

Rendering of services to:

Related entities –

External entities 1,410

Total rendering of services 1,410

Cost of sales of goods 103

CONTRIBUTIONS REVENUE

Industry contributions 1 13,546

Total Contributions Revenue 13,546

INTEREST REVENUE

Deposits 3,455

Total Interest Revenue 3,455

NOTE 3 ECONOMIC DEPENDENCY

TA was established under section 5 of the Tourism Australia Act 2004 (the TA Act) and is controlled by the

Commonwealth of Australia.

TA is dependent on appropriations from the Parliament of the Commonwealth for its continued existence and

ability to carry out normal activities.

94 95


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 4 OPERATING REVENUES (continued)

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 5 OPERATING EXPENSES

4f

4g

2005

NET FOREIGN EXCHANGE GAINS

$’000

Non-speculative 958

Total 958

NET GAIN / (LOSS) FROM DISPOSAL OF ASSETS

Plant and equipment

Proceeds from disposal 45

Net book value of assets disposed (380)

Total net (loss) from disposal of assets (335)

5a

2005

EMPLOYEE EXPENSES

$’000

Wages and salaries 23,280

Superannuation 1,825

Leave and other entitlements 840

Separation and redundancy payments 591

Other employee benefits 1,329

Total employee benefits expense 27,865

Workers compensation premiums 39

Total employee expenses 27,904

4h

OTHER REVENUE

Office sub-tenancies 846

Other revenue 282

Total other revenue 1,128

1 Industry contributions reflect the actual value of industry support for Tourism Australia’s activities from cash revenue. In addition to

direct revenues from the industry, joint marketing programs were undertaken. Through these programs the industry supplements

funds provided by TA for product development, visiting journalist and tactical marketing programs. Due to the nature of the programs,

these funds do not form part of the reported level of industry contributions for Tourism Australia, but are in addition to it.

5b

5c

SUPPLIER EXPENSES

Goods and services from external entities:

Advertising 70,956

Promotion and publicity 18,594

Films, publications and distribution 10,596

Information Systems and Telecommunications 6,415

Research, service fees and travel 19,122

Operating lease rentals * 4,912

Total supplier expenses 130,595

* These comprise minimum lease payments only.

DEPRECIATION AND AMORTISATION

Leasehold, plant and equipment 540

Software (includes websites) 892

Trade Mark 11

Total depreciation and amortisation 1,443

5d

WRITE-DOWN OF ASSETS

Financial assets:

Provision for bad debts 37

Write down of inventory 99

Total write-down of assets 136

5e

OTHER EXPENSES

Other operating expenses 5,027

Total other expenses 5,027

96 97


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 6 FINANCIAL ASSETS

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 6 FINANCIAL ASSETS (continued)

6a

2005

CASH

$’000

Australian Dollars 14,794

New Zealand Dollars 167

Euro 57

Hong Kong Dollars 225

Korean Won 29

Japanese Yen 46

Great Britain Pounds 1,086

United States Dollars 148

Singapore Dollars 100

Malaysian Ringgit 37

Thailand Baht 47

Chinese Yuan 27

Other 5

Total Cash 16,768

Balance of cash as at 30 June shown in the Statement of Cash Flows 16,768

6b

2005

RECEIVABLES

$’000

Goods and services 5,803

Less: Provision for doubtful debts (219)

5,584

Deposits and advances 596

Receivables for goods and services (gross) 6,180

Insurance fund receivable 1,656

Interest receivable 512

Other receivables 2,168

Total receivables (net) 8,348

All receivables are current assets.

TA’s normal terms of trade are 30 days.

Receivables (goods and services gross) are aged as follows:

Not overdue 4,586

Overdue by:

less than 30 days 330

30 to 60 days 618

60 to 90 days 130

more than 90 days 139

1,217

Total receivables (gross) 5,803

The provision for doubtful debts is aged as follows:

Overdue by :

less than 30 days –

30 to 60 days 23

60 to 90 days 57

more than 90 days 139

Total provision for doubtful debts 219

With respect to trade debtors, debts considered to be irrecoverable have

been written off during the period to the amount of $1,800.

98 99


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 6 FINANCIAL ASSETS (continued)

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 7 NON-FINANCIAL ASSETS

6c

OTHER FINANCIAL ASSETS

2005

$’000

7a

PLANT, EQUIPMENT AND INTANGIBLES

2005

$’000

Prepaid expenses 2,141

Total 2,141

Computer and office equipment – at fair value 2,070

Accumulated depreciation (1,535)

535

6d

INVENTORIES

Inventories 149

All inventories are current assets

Furniture and fittings – at fair value 986

Accumulated depreciation (555)

431

6e

OTHER INVESTMENTS

Shares in other company – unlisted (at cost) 400

Less: Provision for diminution in value (290)

Total Other Investments 110

Tourism Australia held an 11.9 per cent interest in Australian Tourism Data Warehouse Pty Limited

(ATDW), which is carried at cost less provision for diminution in value. The provision is based on the

estimated statement of financial position of ATDW as at 30/6/2005. ATDW’s principal activity is the

development of a database for Australian Tourism Products. The investment is a non-current investment.

Leasehold improvements – at fair value 1,427

Accumulated amortisation (787)

640

Software (includes websites) – at cost 9,394

Amortisation (5,513)

3,881

Trade marks – at cost 108

Amortisation (11)

97

Total plant, equipment and intangibles (non-current) 5,584

All revaluations are independent and are conducted in accordance with the revaluation policy

stated at Note 1. In 2004-05, the revaluations were conducted by an independent valuer, the

Australian Valuation Office.

Movement in Asset Revaluation Reserve

Increment for plant and equipment 53

100 101


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 7 NON-FINANCIAL ASSETS (continued)

7b ANALYSIS OF PLANT, EQUIPMENT AND INTANGIBLES

Table A – Reconciliation of the opening and closing balances of property, plant and equipment and intangibles

Item

Total Plant

& Equipment

$’000

Software

$’000

Trade Marks

$’000

Total

$’000

As at 1 July 2004

Gross book value 7,425 7,086 108 14,619

Accumulated depreciation/amortisation (5,806) (4,863) – (10,669)

Net book value 1,619 2,223 108 3,950

Additions by purchase 954 2,562 – 3,516

Net revaluation increment/decrement 53 – – 53

Depreciation/amortisation expense (540) (892) (11) (1,443)

Disposals (368) (12) – (380)

Other movement (112) – – (112)

As at 30 June 2005

Gross book value 4,483 9,394 108 13,985

Accumulated depreciation/amortisation (2,877) (5,513) (11) (8,401)

Net book value at 30 June 2005 1,606 3,881 97 5,584

Table B – Assets at valuation

Item

Total Plant

& Equipment

$’000

Software

$’000

Trade Marks

$’000

Total

$’000

As at 30 June 2005

Gross value 4,483 – – 4,483

Accumulated Depreciation/Amortisation (2,877) – – (2,877)

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 8 PROVISIONS AND PAYABLES

PROVISIONS

8a

2005

EMPLOYEE PROVISIONS

$’000

Salaries and wages 1,802

Leave 2,758

Superannuation 9

Separation and redundancy –

Aggregate employee entitlement liability 4,569

Current 3,304

Non-current 1,265

4,569

PAYABLES

8b SUPPLIERS PAYABLES

Trade creditors and accruals 13,388

Total supplier payables 13,388

8c

All supplier payables are current.

Trade creditors

Settlement is usually made net 30 days

OTHER PAYABLES

Revenue received in advance 1,031

Other short term liabilities 28

Total other payables 1,059

All other payables are current.

Net book value 1,606 – – 1,606

Table C – Assets under construction

Item

Total Plant

& Equipment

$’000

Software

$’000

Trade Marks

$’000

Total

$’000

Gross value at 30 June 2005 163 1,715 – 1,878

102 103


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 9 EQUITY

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 10 CASH FLOW RECONCILIATION

Item

Accumulated

Results

2005

$’000

Asset

revaluation

reserve

2005

$’000

Other reserve

(General

Reserve)

2005

$’000

Total

Contributed

Equity

2005

$’000

Total Equity

2005

$’000

10a RECONCILIATION OF OPERATING SURPLUS TO NET CASH FROM OPERATING ACTIVITIES:

2005

$’000

Reconciliation of operating surplus to net cash from operating activities

Operating surplus before extraordinary items 4,317

Opening Balance 1 July 2004 8,256 353 278 278 9,165

Net surplus/deficit 4,317 – – – 4,317

Net revaluation increment/

(decrement)

– (163) 216 – 53

Transactions with owner:

Contributions by owner:

Appropriation (equity injections) – – – 549 549

Transfers to/(from) reserves – – – – –

Closing Balance 30 June 2005

attributable to the Australian

Government

12,573 190 494 827 14,084

The net revaluation increase in the asset revaluation reserve comprises: 2005

$’000

> Revaluation increment/(decrement) – furniture and fittings (115)

> Revaluation increment – leasehold improvements 169

53

The Asset Revaluation Reserve contains unrealised gains from the revaluation of assets. On

realisation, these amounts are transferred to the General Reserve.

Non-cash items

Depreciation and amortisation 1,443

Fixed asset currency re-translation 112

Net write down of non-current assets 110

Net foreign exchange gain (958)

Loss on disposal of assets 335

Changes in assets and liabilities:

(Increase)/decrease in inventories (149)

(Increase)/decrease in receivables (3,974)

(Increase)/decrease in other assets (754)

Increase/(decrease) in supplier payables 5,483

Increase/(decrease) in employee provisions 1,122

Increase/(decrease) in other payables (688)

Net cash from/(used by) operating activities 6,399

10b RECONCILIATION OF CASH

Cash balance comprises:

Cash on hand 2,827

Deposits at call 13,941

Total cash 16,768

104 105


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 11 DIRECTORS’ REMUNERATION

The number of directors of Tourism Australia included in these figures is shown below in the

relevant remuneration bands:

2005

Number

Nil 2

$30,000 – 39,999 6

$50,000 – 59,999 1

$60,000 – 69,999 1

$170,000 – 179,999 1

$380,000 – 389,999 1

Total Number of Directors 12

2005

$

Remuneration received or due and receivable by directors 821,465

Aggregate amount of superannuation payments in connection with the retirement of directors 45,391

Total remuneration received or due and receivable by directors 866,856

Remuneration includes accrued recreation leave, long service leave and separation payments where applicable.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 12 REMUNERATION OF OFFICERS

The number of officers who received or were due to receive

total remuneration of $100,000 or more:

2005

Number

$120,000 – 129,999 1

$130,000 – 139,999 1

$150,000 – 159,999 2

$160,000 – 169,999 2

$180,000 – 189,999 2

$190,000 – 199,999 1

$200,000 – 209,999 1

$210,000 – 219,999 1

$220,000 – 229,999 1

$260,000 – 269,999 1

$320,000 – 329,999 3

$330,000 – 339,999 1

17

2005

$

The aggregate amount of total remuneration of officers shown above. 3,662,178

3,662,178

The aggregate amount of separation and redundancy payments

during the year to officers shown above. 217,513

Remuneration includes accrued recreation leave and long service leave.

The officer remuneration includes all Australian based officers concerned with or taking part in the management of Tourism Australia during

2004-05 except the Managing Director. Details in relation to the Managing Director have been incorporated into Note 11 – Director Remuneration.

NOTE 13 REMUNERATION OF AUDITORS

2005

Remuneration to the Auditor-General for auditing the financial statements for the reporting period. $

The fair value of services provided are: 60,130

No other services were provided by the Auditor-General during the reporting period.

NOTE 14 AVERAGE STAFFING LEVELS

2005

Number

The average staffing levels for Tourism Australia during the year were: 245

106 107


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 15 FINANCIAL INSTRUMENTS

15a TERMS, CONDITIONS AND ACCOUNTING POLICIES

Financial Instrument Notes Accounting Policies and Methods

(including recognition criteria

and measurement basis)

Financial assets

Cash Investments

Receivables for

goods and services

6a

4e

6b

Financial assets are recognised when

control over future economic benefits

is established and the amount of the

benefit can be reliably measured.

Cash and investments are recognised

at their nominal amounts. Interest

is credited to revenue as it accrues.

These receivables are recognised

at the nominal amounts due less

any provision for bad and doubtful

debts. Provisions are made when

collection of the debt is judged to

be less rather than more likely.

Nature of underlying instrument

(including significant terms and

conditions affecting the amount,

timing and certainty of cash flows)

Temporarily surplus funds, mainly from

monthly drawdown of appropriation, are

placed on deposit at call with Tourism

Australia’s banker. Interest is earned

on the daily balance at the prevailing

daily rate. Interest on deposits at call

is paid at month end, interest on term

deposits are paid on maturity and

interest on cash is paid at month end.

Credit terms are up to net 30 days.

Other 6c Prepaid expenses and accrued income Expenses relating to future period

are recognised at the nominal amounts. but paid during the current period are

deferred to the future period.

Income relating to the current period

but received in the future period is

recognised in the current period.

Financial Liabilities Financial liabilities are recognised when

a present obligation to another party

is entered into and the amount of the

liability can be reliably measured.

Trade creditors 8b Creditors and accruals are recognised

at their nominal amounts, being the

amounts at which the liabilities will

be settled.

Liabilities are recognised to the

extent that the goods or services

have been received (and irrespective

of having been invoiced).

Other Payables 8c Revenues received in advance are

recognised at the nominal amounts.

Settlement is usually made

up to net 30 days.

Revenue relating to a future period,

but received during the current period

is deferred to the future period.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 15 FINANCIAL INSTRUMENTS (continued)

15b INTEREST RATE RISK

Financial Instrument

Financial Assets

(Recognised)

Notes

Floating

Interest Rate

2005

$’000

Fixed Interest

Rate

2005

$’000

Non-Interest

Bearing

2005

$’000

Total

2005

$’000

Weighted

Average

Effective

Interest Rate

2005

$’000

Cash at Bank 6a 2,822 – 5 2,827 4.2

Deposits at Call 6a 13,941 – – 13,941 5.4

Receivables for goods

and services (gross)

6b – – 6,180 6,180 n/a

Insurance fund

receivable

6b – – 1,656 1,656 n/a

Interest receivable 6b – – 512 512 n/a

Other Receivables 6c – – 2,141 2,141 n/a

Total 16,763 – 10,494 27,257

Total Assets 33,100

Financial Liabilities

Trade creditors 8b – – 13,388 13,388 n/a

Other payables 8c – – 1,059 1,059 n/a

Total – – 14,447 14,447

Total Liabilities 19,016

108 109


NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 15 FINANCIAL INSTRUMENTS (continued)

15c NET FAIR VALUES OF FINANCIAL ASSETS AND LIABILITIES

Note

Total carrying amount

2005

$’000

Aggregate net fair value

2005

$’000

Financial Assets

Cash at bank 6a 2,827 2,827

Deposits at call 6a 13,941 13,941

Receivables for goods and services 6b 8,348 8,348

Other receivables 6c 2,141 2,141

27,257 27,257

Financial Liabilities

Trade creditors 8b 13,388 13,388

Other payables 8c 1,059 1,059

14,447 14,447

Financial assets

The net fair values of cash, deposits on call and non-interest-bearing monetary financial assets approximate

their carrying amounts.

Financial liabilities

The net fair values for trade creditors, all of which are short-term in nature, are approximated by their

carrying amounts.

15d CREDIT RISK EXPOSURES

The maximum exposures to credit risk at reporting date in relation to each class of recognised financial

assets is the carrying amount of those assets as indicated in the Statement of Financial Position.

TA had no significant exposures to any concentrations of credit risk.

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 16 CONTINGENT LIABILITIES AND ASSETS

TA had no contingent assets or liabilities, quantifiable or unquantifiable.

NOTE 17 REPORTING OF OUTCOMES

TA operated in Australia and overseas to promote tourism to Australia. Its revenues were sourced

primarily within Australia via Parliamentary appropriations and industry revenues. TA’s activities to

promote Australia as an international tourist destination were primarily focused overseas (the majority of

expenditures were made via TA’s international offices in Europe, Asia, United States and New Zealand).

17a OUTCOMES OF TOURISM AUSTRALIA

TA was structured to meet one outcome:

Outcome 1: TA seeks to stimulate sustainable international and domestic demand for an Australian

tourism experience, and to maximise the return on investment of the tourism and travel industry’s total

marketing effort, as measured by total visitor spend and dispersal of that spend. By doing so, TA aims to

increase economic benefits to Australia from tourism underpinned by a sustainable tourism industry.

TA’s statutory objectives were:

> influence people to travel to Australia, including for events;

> influence people travelling to Australia to also travel throughout Australia;

> influence Australians to travel throughout Australia, including for events;

> help foster a sustainable tourism industry in Australia; and

> help increase the economic benefits to Australia from tourism.

Three Output Groups were identified for this outcome:

Output Group 1: Industry and market development through strategic insights.

Output Group 2: Increased distribution of Australian tourism product and facilitation of niche, events and

regional tourism growth.

Output Group 3: Consumer travel demand stimulation.

110 111


Glossary

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

For the year ended 30 June 2005

NOTE 17 REPORTING OF OUTCOMES (continued)

17b NET COST OF OUTCOME DELIVERY

Outcome 1

2005

$’000

Total expenses 165,485

Cost recovered from provision of goods and services to the non-government sector 1,515

Total costs recovered 1,515

Other external revenues

Advertising 10,781

Industry contribution 13,546

Interest 3,455

Net foreign exchange gains 958

Revenue from sale of assets 45

Other 1,128

Total other external revenues 29,913

Net cost of outcome 134,057

17c REVENUES AND EXPENSES BY OUTPUT GROUPS

Output Group 1

2005

$’000

Output Group 2

2005

$’000

Output Group 3

2005

$’000

Non-Specific

2005

$’000

Total

2005

$’000

Operating expenses

Employees 8,734 6,334 12,836 – 27,904

Suppliers and other expenses 16,275 21,700 97,648 – 135,622

Value of assets disposed – – – 380 380

Depreciation and

amortisation

– 216 1,227 – 1,443

Write-down of assets 102 34 – – 136

Total Operating expenses 25,111 28,284 111,710 380 165,485

Funded by:

Revenue from Government 23,000 12,410 102,964 – 138,374

Advertising – 556 10,225 – 10,781

Sale of goods and services 1,200 294 21 – 1,515

Industry contribution 1,962 11,139 445 – 13,546

Revenue from Sale of Assets – – – 45 45

Net foreign exchange gains – – – 958 958

Other non-taxation revenues 48 909 3,626 – 4,583

Total operating revenues 26,210 25,308 117,281 1,003 169,802

ACRONYM

TITLE

ADS

Approved Destination Status

AMEX American Express

ANTA

Australian National Travel Association

ASP Aussie Specialist Program

ATC

Australian Tourist Commission

ATDW

Australian Tourism Data Warehouse

ATE

Australian Tourism Exchange

ATEC

Australia Tourism Export Council

AUD

Australian Dollar

BTR

Bureau of Tourism Research

DAMA

Destination Australia Marketing Alliance

DEST

Department of Education, Science and Training

DFAT

Department of Foreign Affairs and Trade

DIMIA

Department of Immigration and Multicultural and Indigenous Affairs

DITR

Department of Industry, Tourism and Resources

EEO

Equal Employment Opportunity

GCC

Gulf Co-operative Council

IT&ME

Incentive Travel and Meeting Executives Show

IMEX

Worldwide Exhibition for Incentive Travel, Meetings and Events

JAAG Japan Australia Advisory Group

JAL Japan Airlines

JAM Japan Australia Mission

JATA Japan Association of Travel Agents

KPI

Key Performance Indicator

M2006 Melbourne Commonwealth Games 2006

MATTA

Malaysian Association of Tour and Travel Agents

MP

Member of Parliament

MOU

Memorandum of Understanding

MTR Hong Kong’s rail network

OLs

Office Ladies – Japanese

PATA

Pacific Asia Travel Association

STO

State and Territory Tourism Organisation

TA

Tourism Australia

TABEE

Team Australia Business Events Educational

TEA Tourism Events Australia

TFC

Tourism Forecasting Committee

TRA

Tourism Research Australia

TTF

Tourism and Transport Forum

TTG

Travel Trade Gazette

UAE

United Arab Emirates

VJP Visiting Journalists Program

YOLs

Young Office Ladies – Japanese

112 113


Tourism Australia overseas offices

Index

AUSTRALIA

JAPAN

TAIWAN

A

G

Q

Sydney

Level 18, Darling Park Tower 2

201 Sussex Street

Sydney NSW 2000

Australia

Telephone +61 2 9360 1111

Facsimile +61 2 9331 6469

Canberra

Level 1

33 Allara Street

Canberra ACT 2601

Australia

Telephone +61 2 6213 6940

Facsimile +61 2 6213 6983

CHINA

Unit 1501, 15/F, Citigroup Tower

33 Hua Yuan Shi Qiao Road,

Lujiazui

PuDong, Shanghai 200120

China

Telephone +86 21 6887 8129

Facsimile +86 21 6887 8133

GERMANY

Neue Mainzer Strasse 22

D 60311

Frankfurt/Main Germany

Telephone +49 69 274 00622

Facsimile +49 69 2740 0640

HONG KONG

Suite 6706

67th Floor Floor Central Plaza

18 Harbour Road

Wanchai Hong Kong

Telephone +852 2802 7700

Facsimile +852 2802 8211

New Otani Garden Court

Building 28F

4-1 Kioi-cho Chiyoda-ku

Tokyo 102-0094 Japan

Telephone +81 3 5214 0720

Facsimile +81 3 5214 0719

KOREA

20th Floor Youngpoong Building

33 Seorin-dong

Chongro-ku

Seoul 110-752 Korea

Telephone +82 2 399 6500

Facsimile +82 2 399 6507

MALAYSIA

Suite 12-1

Faber Imperial Court

Jalan Sultan Ismail 50250

Kula Lumpur Malaysia

Telephone +60 3 2611 1148

Facsimile +60 3 2070 4302

NEW ZEALAND

Level 3

125 The Strand

Parnell

Auckland New Zealand

Telephone +64 9 915 2826

Facsimile +64 9 915 2881

SINGAPORE

101 Thompson Road

United Square #08-03

Singapore 307591

Telephone +65 6255 4555

Facsimile +65 6253 8431

Suite 1512, Level 15

333 Keelung Road, Section 1

Taipei Taiwan

Telephone +886 2 2757 7188

Facsimile +886 2 2757 6483

THAILAND

Unit 1614

16th Floor

River Wing East

Empire Tower

195 South Sathorn Road

Yaanawa Sathorn

Bangkok Thailand 10120

Telephone +66 2 670 0640

Facsimile +66 2 670 0645

UNITED KINGDOM

Australia Centre

Australia House

6th Floor

Melbourne Place/Strand

London UK WC2B 4LG

Telephone +44 20 7438 4601

Facsimile +44 20 7240 6690

UNITED STATES

6100 Centre Drive

Suite 1150

Los Angeles California

United States 90045

Telephone +1 310 695 3200

Facsimile +1 310 695 3201

Advertising and Design 37, 38

American Express 8, 47, 113

Asia 8, 15, 18, 47, 48, 49, 50, 56,

58, 60, 62, 88, 111, 113

ATE 7, 9, 15, 34, 35, 39, 45, 46, 57, 63, 72,

113. See also Australian Tourism Exchange

Aussie Enthusiasts 50

Aussie Specialist Program 9, 15,

46, 50, 54, 55, 57, 58, 59, 60, 61,

62, 63, 68, 69, 70, 71, 72, 113

Australasia 18, 42, 44, 46

Australian Experiences 7, 8, 12, 18, 42, 45

Australian Tourism Exchange 9, 32, 34,

45, 46, 47, 57, 63, 72, 113. See also ATE

Aviation and Analysis 18, 32

B

Backpacker 7, 33, 71

Board 5, 7, 17, 18, 19, 20, 21, 22, 26, 30

Business Events 8, 28, 41, 58, 113.

See also Tourism Events Australia

C

Canada 9, 47, 54, 89

Caravan and camping 12, 33

Cathay Pacific 9, 58

Chairman 5, 7, 8, 17, 18, 20, 21, 22, 34, 78

China 6, 8, 9, 16, 31, 35, 37, 39,

47, 49, 56, 57, 88, 114

Corporate Affairs 18, 34, 35

Corporate Governance 17, 18

Corporate Planning 30

Corporate Services 10, 18, 26, 28

D

Denmark 71

Domestic Marketing 5, 34, 35, 43, 85

E

e-Strategy 18, 40

Ecotourism 7, 12, 15

Education 27, 35, 50, 57, 58, 62, 63, 113

Emirates 49

Europe 6, 9, 15, 18, 40, 46, 48, 49,

50, 68, 69, 70, 72, 89, 111

F

Fairfax 43

Financial Statements 19, 76–112

Food and Wine 7, 12, 45, 60

France 9, 33, 47, 68

Germany 6, 9, 31, 47, 69, 89, 114

Gulf Countries 7, 18, 47, 48, 66

H

Highlights 2004 - 2005 8

Hong Kong 7, 9, 32, 37, 47,

58, 88, 98, 113, 114

Human Resources 18, 19, 21, 26, 29

I

India 7, 32, 33, 47, 49, 59

Indigenous 7, 8, 12, 33, 45, 49, 59, 113

International Media 18, 28, 37, 38, 39, 40

Ireland 47, 72

IT 28. See also Technology Services

Italy 31, 33, 47, 70

J

Japan 6, 9, 18, 31, 35, 37, 40, 47,

48, 64, 65, 88, 113, 114

Japan Airlines 9, 64, 65, 113

K

Korea 6, 8, 9, 14, 31, 32, 35, 49, 60, 88, 114

L

Latin America 50

M

Malaysia 9, 37, 61, 88, 114

Managing Director 6, 7, 17,

18, 20, 22, 34, 78, 107

Marketing 18, 36, 37, 38, 40

Mexico 9, 50

Middle East 47, 66

Minister 30, 34, 35, 58, 73, 76, 85

Minister for Small Business and Tourism,

the Hon Fran Bailey MP 1, 7, 17, 18

N

National Geographic 39

Netherlands 33, 47, 71

New Zealand 6, 9, 18, 41, 42,

47, 67, 89, 98, 111, 114

niche 7, 8, 12, 45, 111

Nordic 71

North America 14, 15, 37, 40, 54, 55

P

Partnership Marketing 18, 42, 44

Qantas 7, 8, 9, 16, 46, 49, 50, 54, 55,

56, 58, 59, 64, 66, 67, 68, 70, 73

R

Risk and Administration 18, 27

S

Singapore 7, 31, 32, 37, 47, 62, 88, 98, 114

Singapore Airlines 49, 69, 70, 73

Strategy and Research 30, 32

Sweden 71

Switzerland 33, 69

T

Taiwan 32, 63, 88, 114

Technology Services 28. See also IT

Thailand 47, 49, 63, 88, 98, 114

Tourism Events Australia 8, 18, 33, 113

Trade Events 9, 18, 28, 35, 42, 46, 47

U

UK 6, 8, 9, 15, 18, 31, 35, 48, 68, 70, 72,

73, 114. See also United Kingdom

United Kingdom 32, 37, 39, 46,

47, 72, 89, 114. See also UK

United States 9, 14, 32, 98, 114. See also US

US 6, 8, 28, 31, 47, 54, 55.

See also United States

V

Visa 8, 16, 56

Visiting Journalists Program 9, 10, 15, 37, 39,

57, 63, 65, 67, 70, 71, 73, 113. See also VJP

VJP 10, 39, 54, 55, 57, 60, 63, 65, 67, 70, 71,

73, 113. See also Visiting Journalists Program

114 115


116

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