AWB Limited - 2004 Annual Report

Annual Report 2004

Australia’s largest agribusiness and one
of the world’s largest wheat marketing
and management companies.
Contents
Page
Page
Who We Are 1 Executive Profiles 38
Growing Our Horizons 2 Corporate Governance
40
Five Year Summary 5 Board of Directors – AWB Limited
46
Chairman’s and Managing Director’s report 7 Board of Directors – AWB (International) Limited 48
Pool Management Services 11 Financial Statements
50
Landmark 15 ASX Additional Information
105
Finance and Risk Management 19 Shareholder Communication
106
Grain Acquisition and Trading 23 Major ASX Announcements
107
Supply Chain and Other Investments 27 Glossary
108
Our People 31 National and International Presence
109
Our Social Commitment
35

Who We Are
AWB Limited (AWB) is Australia’s largest agribusiness and one of the
world’s largest wheat marketing and management companies. In 2004,
the company that began as the Australian Wheat Board in 1915, has
continued its evolution, becoming one of Australia’s top 100, publicly
listed companies.
AWB is the exclusive manager and marketer of all Australian bulk
wheat exports through what is known as the Single Desk. As manager
of the AWB National Pool, its core business is to generate maximum
returns for growers of Australian wheat. It markets wheat into more
than 50 countries, with Australian wheat exports worth up to $5
billion per year. AWB markets and trades a range of other grains both
domestically and internationally, including barley, sorghum and
oilseeds, as well as providing additional services such as chartering.
AWB’s Australian footprint includes more than 430 outlets across
Australia, and it is a full service provider for the business needs of
Australian farmers. With a spread of more than 2,700 staff reaching
about 100,000 farmers, AWB provides a comprehensive range of
finance, insurance and commodity risk management services across all
agricultural regions of Australia, and all major rural industries. Through
its Landmark business, the company is also one of the nation’s largest
handlers of wool, suppliers of rural merchandise, distributors of
fertiliser, marketers of livestock and brokers of rural real estate.
AWB has five main business streams:
Pool Management Services
AWB manages the pooling and global marketing of Australian wheat to maximise net returns for participants in
the AWB National Pool. The management of that grain includes supply chain and logistics from point of receival
in Australia, to point of consumption internationally. The business manages risk on both currency and commodity,
and secures end-use demand. It also actively shapes the national wheat crop, sending market signals through the
value chain to be reflected in the crop quality profile. This is supported through testing to ensure the integrity of
the Australian wheat product. Pool Management also encompasses grain technology, managing AWB’s
participation in plant breeding, and research and development projects through the grain value chain.
Landmark
AWB is a major supplier of agribusiness products and services. The Landmark business leverages an Australia-wide
network of more than 430 outlets providing a diverse range of rural service business including rural merchandise,
livestock, wool marketing, agronomy, real estate and distribution of fertiliser products. Landmark also provides an
expanding rural finance offering, including term and seasonal lending options, insurance and deposits, all serviced
by a national network of financial specialists.
Finance and Risk Management
AWB provides harvest finance against the majority of grain delivered to the AWB National Pool. Following the
integration of Landmark, the financial services business has expanded its range of products, and now provides a
broad range of financial solutions to rural and regional Australia. Through its subsidiary AWB RiskAssist, the
company also provides to grain growers and domestic and international customers a range of price risk management
products. Through its treasury division, this business is responsible for managing capital for the AWB Group.
Grain Acquisition and Trading
AWB has developed a range of products used by growers to sell wheat and other grains. This business is responsible
for domestic grain trading, acting as a principal within the deregulated grain markets (wheat, feed grain, barley,
pulses and oilseeds), and exporting non-wheat grains such as canola and sorghum. Through the international
trading activities, it also services international customers with “other origin” grain products that cannot be supplied
from Australia. It manages AWB’s chartering activities, providing competitive sea freight services for Australian
grain, as well as trading sea freight in the international market.
Supply Chain and Other Investments
AWB develops and manages supply chain infrastructure to move grain from paddock to international customers as
efficiently as possible. The value chain extends to the international end-user, where AWB has invested in offshore
ventures in milling and processing, to help secure demand for Australian wheat.
11
15
19
23
27
1

2004
Growing our Horizons
Grains
Managed the largest ever national wheat crop of 25.2 million tonnes (mt) – up from 9.7mt in 2002/03
Continued business in Iraq with new wheat sales in excess of 1.5mt
Signed the first significant sales to China for eight years, with contracts for 2.5mt
Delivered strong out-performance for the AWB National Pool – $140m for the 2002/03 Pool and a projected $332m to
date for the 2003/04 Pool
Achieved a 25% increase in the grain traded by Australia Trading, taking total volumes to more than four million tonnes
Expanded international trading business, trading two million tonnes of grain in 2003/04, up from 1.2mt the previous year
Managed receivals of 1.8mt for AWB GrainFlow – up from 185,000t in 2002/03
Increased the share of the Egyptian premium flour market held by Five Star Flour Mills to more than 20%
Achieved Occupational Health and Safety AS 4801 accreditation for AWB GrainFlow and Agrifood Technology
2

Finance
AWB harvest finance book peaked at $1.6b, maintaining the leading position in the harvest finance market
Landmark lending book exceeded $1.1b – growth of 34% from 2002/03
Secured an Australian Financial Services (AFS) Licence and successfully converted 85% of Landmark deposits to an
AWB-backed prospectus
Successfully maintained the highest short term credit ratings (A-1+ Standard & Poor’s, P-1 Moody’s) for AWB Harvest
Finance through the ring-fenced company structure
Established a $750m syndicated loan facility agreement with a panel of relationship banks
Rural Services
Record real estate sales worth near $1b, up by 31%
Increased yearly merchandise and fertiliser sales by 13% nationally
Traded approximately two million cattle and 11 million sheep for 2003/04
Integration
Exceeded first year Landmark EBIT integration targets ($5 – $10m), with revenue growth and cost savings
of $13 million
Rebranded all regional offices within the AWB Landmark network
Implemented a company-wide performance incentive plan aligning staff and company interests
3

Revenue from ordinary activities
Return on average equity*
($m)
6,000
5,000
4,000
3,000
2,000
1,000
0
1,758.7
1,956.8
2,319.6
2,211.9
5,464.5
2000 2001 2002 2003 2004
(%)
15
12
9
6
10.1
12.1
13.9
5.4
13.6
3
0
2000 2001 2002 2003 2004
* Pre goodwill and amortisation
NPAT ($m)
Net profit after tax* and production volume
140
120
100
80
60
40
20
Net profit
Production volume
0
2000 2001 2002 2003 2004
* Pre goodwill and amortisation
30
25
20
15
10
5
Production volume (million tonnes)
Earnings per share*
(cents)
26.2
34.1
39.2
16.8
40.1
45
40
35
30
25
20
15
10
5
0
2000 2001 2002 2003 2004
* Pre goodwill and amortisation
Dividend per share
(cents)
25
22
22
25
25
25
20
15
10
5
0
2000 2001 2002 2003 2004
AWB's share price appreciated 16% during
2003/04
AWB
Share price ($)
S&P/ASX 200
5.5
5.0
4.5
4.0
3.5
3.0
2.5
1 Oct 03
1 Nov 03
1 Dec 03
1 Jan 04
1 Feb 04
1 Mar 04
1 Apr 04
1 May 04
1 Jun 04
1 Jul 04
1 Aug 04
1 Sep 04
30 Sep 04
4

Five Year Summary
2004 2003 2002 2001 2000
12 months 12 months 12 months 12 months 12 months
ended ended ended ended ended
($A million) 30 Sep 04 30 Sep 03 30 Sep 02 30 Sep 01 30 Sep 00
FINANCIAL
Revenue from ordinary activities
Cost of sales
Depreciation and amortisation
Borrowing costs
Other
Operating profit before tax
5,344.6
(4,612.1)
(83.3)
(113.9)
(388.2)
147.1
2,211.9
(1,889.2)
(29.9)
(70.5)
(163.4)
58.9
2,319.6 1,956.8 1,758.7
(1,926.3) (1,608.1) (1,474.6)
(14.5) (8.0) (5.6)
(98.6) (95.9) (89.9)
(127.0) (122.2) (90.1)
153.2 122.6 98.5
Operating profit after tax
97.7
44.2
107.8 84.2 63.7
Net profit after tax (post goodwill & amortisation)
Net profit after tax (pre goodwill & amortisation)
96.9
134.7
43.9
46.3
107.2 83.7 63.3
107.2 83.7 63.3
OTHER
Total assets
Capital expenditure
Shareholders’ equity
3,735.2
35.6
1,046.2
2,494.4
93.1
932.0
2,641.1
81.7
789.5
1,987.8 1,818.9
58.1 35.8
751.0 628.9
Return on average equity (%) (post goodwill & amortisation)
Return on average equity (%) (pre goodwill & amortisation)
9.8
13.6
5.1
5.4
13.9
13.9
12.1 10.1
12.1 10.1
Earnings per share (post goodwill & amortisation)
Earnings per share (pre goodwill & amortisation)
28.8
40.1
15.9
16.8
39.2
39.2
34.1 26.2
34.1 26.2
Dividend per share (cents)
Gearing (net debt to equity)
Gearing (net debt to net debt plus equity)
Net tangible asset backing per share
25
39.8%
28.5%
$1.55
25
60.0%
37.5%
$1.26
25
11.9%
10.7%
$2.89
22 22
(35.7%) (41.8%)
(55.4%) (71.9%)
$2.75 $2.60
Average loan book (billion)
Production (million tonnes)
AWB National Pool receivals (million tonnes)
1.044
25.2
19.957
0.827
9.7
4.509
1.500
24.9
19.541
1.281 1.150
22.0 24.7
15.214 19.013
5

Andrew Lindberg,
Managing Director
Brendan Stewart,
Chairman
Vision
“To be Australia’s leading agribusiness.”
6

Chairman’s and
Managing Director’s Report
In 2004, AWB has been able to demonstrate
its strategy in action, providing a view for
growers and shareholders of our growing
horizons as Australia’s leading agribusiness.
AWB weathered the drought that afflicted the
nation in 2002/03, and has emerged from it a
more robust company. We have continued to
deliver value through our core grains
business, and have now also completed the
first year of integration of Landmark and
AWB. We have met our operational and
financial targets, and have identified
opportunities for future growth. Through our
unique combination of local knowledge and
global reach, AWB is well positioned as
Australia’s leading agribusiness to participate
in the growth of Australian agriculture.
A record profit
For the 2004 financial year, AWB delivered
an after tax profit of $96.9 million (post
goodwill and amortisation) above market
expectation and up substantially from the
drought affected result of 2003. Our earnings
per share of 28.8 cents was up 81% from the
previous year.
Increased grain volumes have benefited the
company across all business streams,
particularly our domestic grain trading and
financial services businesses. Similarly, a larger
AWB National Pool volume for 2003/04, and
strong out-performance results, helped deliver
a forecast pool value of $4.8 billion, up from
$1.3 billion in 2002/03. AWB’s improved
performance, however, has not been solely
wheat related. The Landmark business is now
making a strong contribution to the bottom
line, with business in rural services such as
merchandise and fertiliser rebounding
strongly after the drought.
A notable contributor to the 2004 financial
result was the AWB chartering activities. An
increase in physical freight business and a
successful freight trading strategy in a rising
market have delivered record results from the
chartering business.
Landmark integration on track
A priority in 2004 was the integration of
Landmark within the AWB Group. We set
ourselves demanding targets for this task, and
it is pleasing to report that for 2004, these
targets have been exceeded. AWB has
delivered costs synergies and finance growth
of $13 million EBIT, ahead of the $5 – $10
million targeted for this financial year. We are
now well poised to achieve our longer term
EBIT target of $30-$40 million derived from
the integration by 2005/06.
The network has been consolidated and rebranded,
and finance and insurance
specialists recruited to bolster the team. We
have integrated the business administration
functions and introduced incentive programs
for all staff. We now look forward to turning
our full focus to implementing our Integrated
Business Model and firmly positioning AWB
as Australia’s leading agribusiness.
Good progress has already been made on this
front. We have delivered new finance
products and packages that capitalise on the
inherent strengths of the two organisations,
delivering value for our customers and the
company. AWB is pursuing further growth in
lending, insurance and deposits, and
capitalising on the cross sell opportunities
within our finance, rural service and grain
businesses.
Delivering value to the Pool
In the past two years, AWB has managed one
of the smallest national wheat crops (9.7
million tonnes in 2002/03), followed by the
largest ever Australian wheat harvest of 25.2
million tonnes in 2003/04. This presented a
range of challenges in a politically and
commercially volatile global grains market.
We believe results from our core business –
delivering value to Australian wheat growers –
have been outstanding. Over the past three
financial years, we have delivered high levels
of out-performance for pool participants.
This year, highlights have included
management of our sales program to Iraq,
where despite heightened competition, we
secured new contracts for more than 1.5
million tonnes of wheat. Our program has
also included the first significant sales to
China in eight years, following agreements to
date for 2.5 million tonnes. Business with our
key customers continued, with record exports
of more than three million tonnes to
Indonesia, and near record sales to Egypt.
Making this possible, of course, has been a
logistics program which moved more than
90% of the crop within nine months of
harvest, setting grain movement and shipping
records in the process.
As with all business, there is always room for
improvement. In 2004, we commissioned an
extensive study of the AWB National Pool’s
place within the global wheat market, looking
at both our customers and competitors. The
research reiterated that the global market
place is increasingly competitive. Both
traditional and new competitors are making
inroads into our premium market position,
and as they do, our customers are expecting
more from us. We know we cannot afford to
7

sit still. For some time, AWB National Pool
has had strategies in place to combat the
growing competition. However, this new
research has assisted us to develop a more
targeted plan, and to more clearly identify the
best areas for investment to maintain and
improve our market position. The first stages
of this project are already being implemented,
and success will mean more value for the pool
and all those involved with it.
Strong Single Desk support
AWB’s commitment to the Single Desk
remains unwavering. In 2004, AWB
(International) Limited (AWBI) commissioned
research which proved just why the system has
the support of the vast majority of Australian
wheat growers. The independent study
(conducted by the Boston Consulting Group)
showed the Single Desk delivers, on average,
an additional $13 per tonne of wheat from
the international market, with multiplier
benefits cascading through rural and regional
Australia. Further independent research has
reiterated that more than 80% of growers
support the wheat marketing system. Both
sides of Australian politics have also shown
their support for a system that clearly benefits
wheat growers.
AWB’s performance in managing that system
was commended by findings of the
independent review conducted this year and
released in October. The Independent Panel
conducting the review concluded that AWBI’s
performance in international markets had
resulted in significant benefits to growers. It
found AWBI had performed well in
managing the domestic supply chain and
achieving price premiums for Australian
wheat exports, and recommended that the
key components of the Single Desk system
remain in place. The Independent Panel also
put forward a number of administrative
recommendations. The Board of AWBI has
considered these, and in November
announced a number of initiatives in
accordance with the panel’s findings.
Included in these initiatives is an AGM
resolution to provide the AWBI Board with
greater independence. AWB has also
announced changes to the remuneration
model through which AWB Limited receives
payment for services to operate the National
Pool. In line with recommendations from the
panel, the model will be refined so that the
base fee is fixed to reflect the costs and risks
associated with running the Pool. The
changes will be implemented in 2005.
Trade development
To enhance our global reach, AWB retains a
focus on trade development. The Free Trade
Agreement between Australia and the United
States presents trade opportunities, not
necessarily for wheat, but for a range of other
agricultural products such as beef and dairy.
An equally important outcome of this
agreement though was the Australian
government’s success in retaining the Single
Desk for Australian wheat growers – a system
which allows them to fairly compete in a
distorted trade environment. Further trade
agreements now being pursued by the
Australian government, particularly with
countries such as China, Egypt and Malaysia,
could also open the door for expanded trade
flows in a range of commodities.
More significant trade developments took place
at the multi-lateral level through the World
Trade Organization. A new framework has been
reached which, while unbinding at present,
could pave the way for some significant reform
of the world grain trade. Any progress in
reducing the level of production and export
subsidies provided by some countries is sure to
have positive ramifications for Australian
producers and exporters.
A commitment to communities
As a major supporter of rural Australia, we
have continued to contribute actively to the
communities in which we live and work. We
have fostered industry leadership through
commitments such as our inaugural Young
Leaders Conference and Single Desk Summit
this year, and we engage with communities at
a local level through support and sponsorship
arrangements. We are also committed to
environmental and agricultural sustainability
through our involvement in dryland salinity
projects and the Computershare eTree
initiative.
A commitment to our staff
Critical to our strategy and also one of our
strengths, are our employees. While the past
12 months has been one of significant change
for many of our people, their expertise and
professionalism has always shone through. The
Board and Management would like to thank
all employees for their dedication and service.
8

To continue building its capability base,
AWB has increased the scope of training and
development for its frontline employees,
backed by a framework for identification and
delivery of training requirements in the
business. Also, in recognition of AWB’s
commitment to the safety of its people, in
2004 the company achieved AS 4801
accreditation for AWB GrainFlow and
Agrifood Technology – reflecting best practice
occupational health and safety levels in
Australia. This accreditation involved an
extensive auditing and risk assessment
process, and development of standard
operating procedures across key areas of the
AWB business. In the coming year, AWB will
seek to extend this accreditation to its
Landmark business.
Growing horizons
Our vision is to be Australia’s leading
agribusiness, by continuing to be the business
partner of choice for primary producers and
end customers. Our strategy to achieve this
has not changed – we will continue to
strengthen our core business and seek
appropriate avenues for diversification. With
the integration of Landmark, we have
identified three priority areas:
Grains and commodities
The long-term retention of the Single Desk
for wheat exports remains paramount. We
are committed to ensuring maximum returns
are generated for growers and have a strategy
to improve the differentiated quality position
of Australian wheat and to continue our
success in driving supply chain efficiencies.
Ultimately, the value for growers who deliver
to the AWB National Pool is best achieved by
keeping the interests of the manager and
participants aligned. Beyond wheat, AWB
will also seek to apply its management
expertise to other Australian agricultural
commodities, and where appropriate, to
commodities from other origins.
Rural services
AWB will seek to expand the Landmark
presence in Australia, with growth
opportunities in a range of rural service
sectors, such as merchandise and fertiliser.
AWB will leverage its consolidated buying
power to improve supply chain efficiencies,
and through an optimal regional network,
will maximise cross selling and bundling
opportunities.
Financial services
AWB seeks to expand its rural finance
business by offering a range of financial
solutions designed to meet agribusiness
requirements and retain a leading market
position in harvest finance through fine
tuning our competitive products to meet
increasingly sophisticated market
requirements. AWB is also targeting growth
of, and within, the broader agribusiness
finance market, through new initiatives in
lending, deposits, wealth management and
general insurance, and with competitive
interest rates and streamlined processes.
Outlook
AWB’s financial objectives remain clear –
solid financial growth, stable dividend
payments, efficient capital management and
improved quality of earnings.
In 2005, we are committed to continuing the
progress we have made with the integration
of Landmark, unlocking the value within the
two organisations and achieving our earnings
targets. We expect the drought to continue to
have some lagging impact in terms of
livestock and wool volumes, but the market
for merchandise and fertiliser is promising,
and livestock prices look set to remain strong.
In our core grains business, the global market
is becoming more competitive. International
wheat prices have softened, world wheat
production has hit record levels and stocks
have rebuilt. However, we have a clear
strategy to generate more value from the
Australian wheat crop, and as a stronger and
more diversified organisation, we have never
been better placed to deliver on it.
Brendan Stewart
Chairman
Andrew Lindberg
Managing Director
Mission
“ To be the primary producer’s and end –
use consumer’ s business partner of choice. ”
9

AWB is one of the largest users of the US
wheat futures exchanges in Chicago, Kansas
City and Minneapolis, and on an average
day, can hedge up to 300,000 tonnes for
the AWB National Pool.
NPBT* – Pool Management Services
Jillian Wright
Agrifood
Technology
($m)
30
25
20
15
10
5
0
2000 2001 2002 2003 2004
* Net profit before tax
10

Pool Management Services
Highlights
Finalised the 2002/03 AWB National Pool
with near record pay grade returns
Received 19.9mt from the largest ever
national wheat crop of 25.2mt
Shipped 19.1mt for year ended November
30, the second largest ever program
Successfully continued trade with Iraq,
securing sales in excess of 1.5mt
Sold 2.5mt to China, the first significant
sales since 1996
Achieved record sales of more than 3mt to
Indonesia
Reduced supply chain costs for the sixth
consecutive year
Achieved $140 million in outperformance
value above the Wheat
Industry Benchmark for the 2002/03
AWB National Pool, and a projected $332
million to date for the 2003/04 Pool
AWB National Pool
AWB, through its wholly owned subsidiary
AWB International (AWBI), manages the
AWB National Pool. Integrated services are
provided by AWB to AWBI for a fee under a
commercial services agreement approved by
the boards of both companies. AWB National
Pool provides growers with a world leading
grain marketing and risk management
system, which actively manages wheat on
their behalf from the point of delivery in
Australia, to the point of consumption in the
global market.
Active Pool manager
During the financial year, AWB finalised the
drought impacted 2002/03 AWB National
Pool. As part of its management, AWB was
forced to ration supply to international
customers with export volumes that were less
than 25% of the previous Pool. AWB worked
with domestic grain users during the drought,
adjusting its export program and selling more
than one million tonnes domestically to help
satisfy demand, while still meeting its
mandate to maximise net pool return.
Although Pool value of $1.3 billion from
2002/03 was down markedly (from $5.3
billion the previous year), the pay grade
return for the benchmark Australian
Premium White (APW) of $258.39 per
tonne was one of the highest ever achieved.
International sales and marketing
For 2003/04, the volumes available for export
rebounded sharply to almost 20 million
tonnes. AWB made excellent progress in its
sales and marketing campaign for this crop,
capitalising on good pricing opportunities to
sell more than 90% of available tonnages by
the end of the financial year.
Highlights included sales of 2.5 million
tonnes to China, the first significant business
with that country since 1996. AWB
continues to work with the Chinese buying
agencies, and with wheat demand likely to
remain strong, is confident of further sales to
China during the next 12 months. Despite
the political and logistical hurdles in Iraq, the
country has remained a key market for
Australian wheat. In 2004, AWB struck new
contracts for more than 1.5 million tonnes
with Iraq, meeting food requirements and
maintaining our share of the Iraqi market.
AWB continues to service its long standing
market base in Asia and the Middle East, and
this year announced record sales programs to
two of the most important markets – Egypt
and Indonesia. AWB has also created a
market success story in Sudan, where,
through an exclusive supply agreement with
the country’s premier flour miller, sales
volumes have grown from nothing five years
ago, to around 800,000 tonnes this year.
AWB supports its premium wheat product
with specialised technical support for
customers. In 2004, AWB held 41 Grain
Industry Orientation programs in Australia
for customers from 17 countries. AWB also
enhanced its branding and supply agreements
with customers such as Bogasari Flour Mills
in Indonesia, where jointly branded flour
products are sold. This year, AWB opened a
baking centre in Vietnam in conjunction
with RMIT University Vietnam. The facility
will train bakers from across South East Asia
and promote the use of Australian wheat in
their flour mixes.
Risk management
Through sound hedging policies and
sophisticated currency and commodity risk
management programs, AWB enhanced and
protected the value of the three Pools under
its management during the 2003/04 financial
year. Importantly, all these programs are
conducted within strict board policies and are
closely monitored by an internal corporate
risk group, and both the AWBI and AWB
boards of directors. The 2002/03 Pool, AWB
achieved an average A$/US$ hedge rate of
US$0.5455 outperforming the Wheat
Industry Benchmark foreign exchange
11

sub-benchmark, and the average spot rate of
US$0.6191 during the life of the pool. In
anticipation of a strengthening Australian
dollar in 2003, AWB was in a strong position
to build up its hedge book and is well on
track to outperform its foreign exchange
benchmark for the 2003/04 Pool and the
current average spot rate of US$0.6987
during the life of the Pool. Hedging is well
underway for the 2004/05 Pool, with sound
risk management programs in place to
protect the Pool from adverse currency
movements, yet providing flexibility to
capitalise on any depreciation in the currency.
AWB is one of the largest users of the US
wheat futures exchanges in Chicago, Kansas
City and Minneapolis, and on an average day,
can hedge up to 300,000 tonnes for the AWB
National Pool. AWB’s commodity hedging
strategy mitigated pool returns from an
historically volatile US futures market that
dropped by 30% during 2004. Although
Estimated Pool Returns have dropped from
their highs, AWB’s hedging program
protected participants from the full impact of
this shift, effectively adding millions of
dollars to Pool value.
Supply Chain Management
In 2004, for the sixth consecutive year, the
AWB National Pool reduced the grain supply
chain costs for Pool participants. It has
achieved this by continuing to negotiate
domestic supply chain agreements on a more
commercial basis. This included a two year
industry rail agreement in South Australia
between grain marketers, bulk handlers and
rail users which has already delivered a 4%
reduction in rail freight rates. Following
changes to State grain legislation in Western
Australia, AWB has been involved in the
renegotiation of industry freight agreements
with the rail provider in that State, which has
seen freight rates reduced by more than 7%.
AWB will continue to focus on cost reduction
in the grain supply chain.
Grower Services
AWB has sought a more sophisticated and
targeted approach to its grower services.
Recent communication initiatives include the
successful AWB National Pool Forums and
Grower Consultative Groups. In 2004,
AWB’s Grower Service Centre managed more
than 90,000 grower enquiries. AWB has
continued to improve its on-line offering
with a specific focus on meeting the
increasingly sophisticated needs of growers.
With a dedicated grower website, AWB is
developing the site as a business portal for
growers’ marketing and finance management.
While grower pay arrangements have become
more complex with the evolution of Golden
Rewards and an increased range of finance
options, AWB has made improvements in
paying growers accurately and on time for
their AWB National Pool deliveries.
Crop Shaping
Shaping the national wheat crop to ensure it
continues to match international customer
demand is an increasingly important part of
AWB’s Pool management strategies. To
facilitate this process, AWB has held two
wheat breeding forums, where key customer
feedback was discussed with the wheat
breeding and research community, to
encourage development of varieties to meet
end-user demand. In its role in classifying
wheat varieties, AWB has taken steps to
improve transparency by appointing
independent members to its Wheat
Classification Panel. AWB has also continued
to develop its Golden Rewards payment
system. Since introducing the scheme with
incremental payment for protein and
screenings, AWB has added payment for
moisture, and in 2004 launched the new
Premium Choice Varieties, where premiums
are provided for varieties with superior grain
quality. The Golden Rewards system is not
replicated anywhere else in the world and is
playing a crucial role in helping AWB shape
the national crop profile.
Grain Technology 1
Agrifood Technology
Agrifood Technology provides testing and
analytical services to support the AWB
National Pool’s international marketing
program. The business also provides
commercial laboratory services to external
clients in related industries. This year,
Agrifood Technology enhanced the process of
variety testing wheat samples at receival, with
the introduction of new DNA based
technology for varietal identification. This
improves AWB’s ability to ensure the integrity
of its wheat parcels and overall sales program.
A milestone for Agrifood Technology was the
achievement of the AS 4801, safety
management system accreditation. Through
this process, standard operating procedures
were implemented across the business,
ensuring operational efficiency and a high
level of safety for Agrifood Technology staff.
Innovation and research
AWB’s research and development is targeted
at the development of new products and
processes that generate higher returns to
1 Previously reported as a separate business unit, Grain Technology is now incorporated within the Pool Management Services business stream.
Loading of ship
at Melbourne
Port Terminal.
12

AWB National Pool participants. AWB is also
working to extend the business platforms for
AWB, including taking proprietary positions
in germplasm and genetic markers for the
development of enhanced Australian wheat
varieties. Each project is scrutinised across the
business which, along with ongoing
assessment, is critical to optimising the
research effort.
Remuneration
AWB is remunerated for its Pool Management
Services through a performance-based system.
To provide an objective measurement of
performance, AWB has implemented an
assessment model called the Wheat Industry
Benchmark (WIB). The WIB acts as a
“competing manager” generating a theoretical
outcome for each seasonal pool against which
actual performance can be measured.
Remuneration is made via a two-tiered
payment structure. This includes a base fee,
calculated at 1.5% of Pool Value (PV) and
subject to a cap and floor. This base fee,
depending on PV, covers the majority of costs
incurred by AWB in managing the AWB
National Pool. The second component is an
Out-Performance Incentive (OPI), through
which AWB can be rewarded with 20% of
AWB National Pool returns achieved above
the WIB and an additional hurdle (currently
US $5 per tonne). The Out-Performance
Incentive is capped at 1.5% of PV. AWB
manages two to three seasonal pools at any
one time and receives proportional
remuneration from each of these pools during
a financial year.
For the most recently finalised 2002/03 AWB
National Pool, AWB delivered $140 million
in out-performance over and above the WIB,
which represented about 10% of total PV.
Due to the small 2002/03 Pool volumes, the
out-performance cap of 1.5% of PV was
invoked. For the 2003/04 Pool, AWB’s
management has delivered projected outperformance
to date of more than $332
million. Total profit earned by AWB for its
Pool Management Services for the 2004
financial year, (which includes earnings from
two seasonal pools) was $32.7 million.
For the year ahead, AWB has refined its
remuneration model in line with the
recommendations from the 2004 Wheat
Marketing Review.
These changes include de-linking the base fee
from Pool Value, and fixing it to reflect the
costs and risk of running the AWB National
Pool. The OPI structure has been divided into
two tiers, both of which are performance
based to enable the manager to achieve a
return through performance. The first tier is
set between the Wheat Industry Benchmark
and the Hurdle, but the majority of the OPI
will reside in the second tier above the Hurdle.
For 2005, the respective boards have
negotiated a fixed base fee of A$65.1m. For
OPI, a 20% incentive will continue to be
paid based on performance, with tier one
OPI capped at 0.375% of Pool Value and tier
two capped at 1.125% of Pool Value.
Outlook
AWBI’s overriding mandate is to maximise
net return to growers who deliver to the
AWB National Pool. In pursuing this goal, it
faces a tough international market, with
increasing competitive threats from “nontraditional”
wheat exporters. To meet this
competition, AWBI has a strategic emphasis
on the Asian region, to capitalise on the
freight and quality advantages we have in
those markets. While still retaining its longheld
relationships in the Middle East, AWBI
is aiming to market 65% of the Australian
wheat crop into Asia by 2009. Delivering on
this strategy, AWBI this year sold more than
10 million tonnes of Australian wheat to Asia
for the first time.
In 2003, AWBI commissioned the Boston
Consulting Group to undertake a study of
the global wheat market; provide some
objective research into market trends from
the perspective of customers and competitors;
and examine how AWB might best respond.
The findings confirmed that AWB’s
competitors were making inroads into the
market advantage that AWB has established.
It also identified some key areas for AWB to
invest in to meet these challenges including:
improved research, development and crop
shaping to meet current and emerging
market requirements;
grower communications strategy that
builds further trust in AWBI's strategy and
drives competitive advantage down the
chain;
realising supply chain opportunities;
boosting trade advocacy; and
clearly differentiating sales and marketing
activities from our competitors.
In response, AWB has instigated a project to
implement these findings and to target the
priority areas of the business for investment.
Financial summary for Pool Management Services
($million)
For the year ending
For the year ending
30 September 2004 30 September 2003
2002/03 Pool 2003/04 Pool Total 2001/02 Pool 2002/03 Pool Total
Base Fee 4.6 57.2 61.8 6.0 41.8 47.8
Out-performance Incentive 4.1 29.4 33.5 14.0 15.3 29.3
Administration costs
– (62.6) (62.6) – (53.8) (53.8)
Total Pool Management Services 8.7 24.0 32.7 20.0 3.3 23.3
13

The Landmark business serves over
100,000 rural customers through its national
network of more than 430 outlets across Australia.
NPBT* – Landmark
(AWB acquired Landmark on 29 August 2003)
80
70
60
50
40
30
20
10
0
2003 2004
* Net profit before tax
($m)
14

Landmark
Highlights
Integrated Landmark and AWB business
processes
Exceeded the first year integration
earnings growth and cost savings target
of $5 – $10 million
Converted 85% of Landmark deposits to
an AWB backed prospectus
Increased Landmark lending book by 34%,
passing $1 billion mark
Upgraded insurance supplier agreements
to meet new financial services legislation
obligations and increased Gross Written
Premium by 20%
Signed an agreement positioning
Landmark as a major supplier of dairy
cattle to China
Increased national merchandise and
fertiliser sales by 13%
Increased real estate sales by 31% to
record levels of near $1 billion
Traded more than two million cattle and
10 million sheep in 2004
Left to right:
Robert McClelland
Dennis Jasprizza
Landmark, Dubbo
Jarrod Ryan
Landmark is Australia’s largest supplier of
farm inputs including merchandise, fertiliser
and chemicals, with significant sales in wool,
livestock and real estate. It also offers a
comprehensive range of lending, deposit and
insurance products and services. The
Landmark business serves over 100,000 rural
customers through its national network of
more than 430 outlets across Australia.
Around half Landmark’s outlets are company
owned, with the balance being owned and
operated by franchisees, agents and affiliate
members.
Integrated Business Model
AWB has developed an Integrated Business
Model (IBM), through which the company
will capitalise on the respective and
complementary agribusiness strengths of
AWB and Landmark. The IBM provides a
framework for strengthening existing business
and creating new custom via an integrated
customer management approach, as well as
optimising the network and procurement
systems to deliver this in the most efficient
manner. The majority of the administrative
integration tasks have been completed, with
the full integration of key functions such as
accounting, treasury, human resources,
corporate insurance, information technology
and legal. Consolidation of the regional
network has also occurred with a number of
AWB and Landmark offices being merged.
The integration of the Landmark and AWB
financial services businesses is delivering
positive financial results, with increased
lending volumes, the launch of new products
and an increase by more than 25% in the
number of specialist staff in the lending and
insurance areas.
During 2004, Landmark has seen a healthy
rebound in its rural services following the
drought induced reduction in volumes last
year. AWB has also improved its competitive
position through network optimisation and
account management strategies across its rural
services businesses, improving efficiencies and
cost control.
Financial services
Financial services is a key driver for growth
through the Integrated Business Model.
Following the acquisition of Landmark, AWB
sought to build the business by investing in
new product development, recruitment of
specialist and experienced staff and creation
of finance offerings that leverage the
company’s local knowledge and global reach.
Excellent progress has been made with
improvements in financial services enabling
the company to exceed its forecast “uplift” for
the first year by more than 10%.
Landmark Lending
AWB is already tapping the finance
opportunities flowing from the integration of
AWB and Landmark financial services.
During 2004, AWB was able to grow the
previous Landmark loan book by more than
$350 million to peak at $1.1 billion. To
achieve this, the company generated a
significant uptake of finance from grain
growers, while maintaining Landmark’s
historically strong connection with livestock
customers. AWB also recruited experienced
senior lending staff with specialist skills in
key agricultural industries. The investment
in product development is already reaping
rewards, with the market launches of new
products such as Fastrak Finance, which
capitalise on the combined skills and
synergies between the two organisations.
15

Landmark is Australia’s largest supplier of farm
inputs including merchandise, fertiliser and
chemicals, with significant sales in wool, livestock
and real estate.
Landmark deposits
The integrated company is also targeting
growth in short and long-term deposit
business. During 2004, the company
converted 85% of deposits to an AWB
backed prospectus, and is now marketing a
range of deposit products to rural customers
through its distribution channels.
Landmark Insurance
Last year, AWB signalled its plan to develop
the insurance business and during 2004, the
company was able to make some significant
progress. AWB recruited staff with specialised
insurance knowledge to support the
Landmark network. The business maintained
a steady growth in Gross Written Premium
over the whole year with an increase of 20%
to $117 million. In partnership with NRMA
(part of Australia’s largest insurance provider,
Insurance Australia Group Limited), AWB is
now distributing compulsory third party
products through Landmark outlets in
Queensland and is pursuing growth in the
crop insurance segment.
Rural Services
Merchandise and Fertiliser
Landmark is the largest merchandise
distributor in Australia, and combined with
its fertiliser distribution business, makes
about $1.3 billion worth of sales annually. In
2004, the merchandise business increased
both its sales volumes and margins. The
diverse spread of Landmark’s merchandise
business, both geographically and by industry,
has mitigated the drought’s impact on total
turnover during the past two years. As part of
16

the integration, Landmark has relocated its
procurement team from Sydney to AWB’s
Melbourne office. The merchandise division
is now focused on improving procurement
processes and the merchandise supply chain
to reduce capital employment and improve
profitability. It has also targeted growth areas
of business, such as merchandise for the
cotton industry.
Landmark also supplies more than one
million tonnes of fertiliser per year, as well as
retailing liquid, trace element and other
specialist fertilisers. It trades as principal with
a number of suppliers for the majority of
sales. Improved seasonal conditions in 2004
helped fuel good growth in national fertiliser
sales and record sales across all sectors.
Landmark is now targeting growth of its
fertiliser business by leveraging cross selling
and product bundling opportunities.
Demand for fertiliser products is positive,
particularly for nitrogen products.
Real Estate
Landmark markets a range of rural properties,
lifestyle blocks and residential real estate. In
2004, the real estate business achieved a
record year with total sales of approximately
$1 billion. Whilst having a significant
presence in the rural property market, the
business is well positioned to expand in the
rural residential real estate market. The real
estate business will also seek to capitalise on
cross sell opportunities, particularly through
Landmark finance and insurance.
Livestock
Landmark is one of Australia’s largest
livestock marketers, with 20% of livestock
trading in Australia, comprising
approximately two million cattle and 11
million sheep per year. About 60% of
Landmark’s sales come from agency activities
through the auction system, although the
company also directly supplies processors,
supermarkets, feedlots and live export
markets. Decreased numbers for sheep and
cattle have reduced sale volumes, although
this has been partly offset by near record
livestock prices. In the past year, Landmark
has further developed its dairy business in
southern Australia, and reached an agreement
with a significant exporter for the supply of
cattle to China.
Wool
Landmark is a major player in Australia’s
wool industry, handling more than 20% of
the national wool clip, or about 500,000
bales in the past year. It provides traditional
broking and auctioning services, as well as
offering alternative selling methods.
Landmark also offers customers a range of
risk management products. In addition,
Landmark is involved in wool handling and
storage through its 50% ownership of
Australian Wool Handlers. In 2004 this
business began providing wool trading
services and has delivered a strong financial
result. During the financial year, Landmark
reinforced its position as the leading marketer
of superfine wool, achieving eight of the top
10 wool prices for the year.
Johnstone River Transport (JRT2)
JRT2 was acquired through Landmark, and is
involved in the transportation of sugar related
products in northern Queensland. With a
fleet of 60 trucks, the business transported
more than 1.8 million tonnes of sugar
products in 2004. JRT2 is also expanding its
revenue base to servicing other industries’
bulk road requirements, including fuel. In
2004, JRT2 transported about 20 million
litres of fuel.
AWB Seeds
Now positioned within the rural services
division of the AWB Group, AWB Seeds has
consolidated its Seednet business structure
this year, working closely with partners across
Australia to improve and streamline the seed
commercialisation value chain. Total sales
through Seednet increased by more than 20%
during 2004. AWB Seeds was also successful
in gaining seven new licences for grain
varieties during 2003/04 and aims to add
more broadacre crop varieties in the coming
season.
Outlook
While drought will have a lagging impact on
business volumes for wool and livestock,
improving seasonal conditions, coupled with
reasonable commodity prices, should create a
positive environment for growth across all
rural services, particularly merchandise and
fertiliser. In the areas of financial services,
AWB is well positioned to expand its
presence with the traditional Landmark
customer base, as well as attract uptake from
its grain grower base. Landmark will also
continue to focus on improving the
procurement and supply processes to enhance
current business, target new areas for growth,
and capitalise on cross-sell and bundling
opportunities through the Integrated Business
Model.
Landmark Stud Stock staff conducting 2004 World Hereford Conference feature sale, Royal Easter Show, Sydney.
17

Through its Integrated Business Model,
AWB will target new products for the broader
rural lending market.
NPBT* – Finance and Risk Management
60
50
40
30
20
10
0
2000 2001 2002 2003 2004
* Net profit before tax
($m)
18

Finance and Risk Management
Highlights
Successfully integrated the AWB and
Landmark financial services teams across
Australia
Retained a leading market share of more
than 70% in harvest finance market
Established AWB Advanced Payment as
the fastest growing new harvest finance
product in the market
Implemented a ring-fence company
structure and maintained credit ratings
Established a $750 million syndicated loan
facility agreement to provide flexible
funding arrangements for AWB Group
Expanded the risk management offer to
international customers through AWB
RiskAssist, taking total business volumes
above five million tonnes
Jamie Taylor
Agronomist
AWB Harvest Finance
AWB’s comprehensive range of harvest
finance products performed well in 2004.
Following the drought, customers showed a
strong interest in protecting their income,
prompting a high uptake of harvest finance.
Despite strong competition, AWB has
maintained its leading share of the harvest
finance market, with the loan book peaking
at $1.6 billion. In 2004, the AWB Advanced
Payment product provided the fastest rate of
growth, now representing 20% of the market.
However, an increasing number of growers
also chose to “mix and match” between the
four AWB harvest finance options, a feature
not available from competitors. AWB also
leveraged its comprehensive Landmark
network, engaging Landmark Finance staff to
sell AWB harvest finance to grain growers
who sourced their broader financing needs
elsewhere.
AWB RiskAssist
AWB RiskAssist Limited, a wholly owned
subsidiary, provides a specialised and
sophisticated risk management service to its
customers, which include Australian grain
growers, as well as domestic and international
grain customers. Drought significantly impacted
business volumes through AWB RiskAssist
during 2002/03 and continued to temper the
grower appetite for such products during 2004.
This has restricted the volumes of grain
attracted to the Basis Pool product. However,
the Basis Pool continues to perform very well
for growers using the product this season.
AWB RiskAssist is also looking to expand its
product offering. In response to grower
demand, it recently launched the Fixed Basis
product, which is already attracting
significant grower interest. AWB RiskAssist is
now aiming to meet grower demand for
simpler products, particularly those that delink
the physical component of the wheat sale
to reduce exposure to washouts during years
of production shortfalls.
AWB RiskAssist has experienced strong takeup
of its price risk management products
from international and domestic customers.
Since introducing these options-based
products as part of the AWB bundled
product offering in 2002, AWB has sold
more than five million tonnes of grain with a
risk management component. These products
enable the customer to offset some of their
price risk, bolster AWB’s customer
relationships and enhance the ability to
secure long-term contracts.
Group Funding & Liquidity
The extent of the AWB Group’s borrowing
program is primarily driven by the level of
finance provided to growers who deliver to
the AWB National Pool, and the timing of
grain deliveries and sales. The AWB Group is
able to obtain funds from a variety of sources
in the domestic and global capital markets,
specifically, through a US$1.5 billion US
commercial paper program, a $1.5 billion
euro commercial paper program and an
A$2.0 billion domestic electronic promissory
note program. In December 2003, AWB
Harvest Finance Limited established an
A$500 million domestic medium-term note
program with the capability to issue both
senior and subordinated longer-term debt.
This program is supported by Australian and
US dollar committed commercial paper
standby facilities. These are provided by
AWB’s relationship banking panel where
commitments are established to provide
liquidity in the event AWB Harvest Finance
Limited is unable to issue commercial paper.
AWB hedges risks arising from interest rate
fluctuations, through a number of approved
instruments including interest rate swaps,
forward rate agreements, exchange traded
futures contracts and options on futures
contracts.
All funding and liquidity support in respect
of the wheat export related operations of the
Group are transacted by AWB Harvest
19

AWB has maintained its dual credit rating
whereby AWB Harvest Finance Limited is able
to achieve the highest possible short-term
ratings available.
20

Finance Limited, a wholly owned,
bankruptcy remote subsidiary of AWB. AWB
Harvest Finance Limited provides growers
delivering to the AWB National Pool with a
suite of unique loan and payment options for
harvest finance.
The commercial activities of the AWB Group
not involving wheat exports are funded by six
relationship banks via a committed A$750
million syndicated loan facility agreement
established in September 2004. This
provides for cash advances and replaces the
previous A$950 million syndicated multioption
facility used for commercial activities.
Three separate tranches of the facility mature
in 2005, 2007 and 2009. The borrower for
the commercial operations of the Group is
AWB Commercial Funding Limited, a wholly
owned and guaranteed subsidiary of AWB
Limited which also provides treasury services
to the commercial subsidiaries of the Group.
Credit Rating
Following successful implementation of the
ring-fenced company structure, AWB has
maintained its dual credit rating whereby
AWB Harvest Finance Limited is able to
achieve the highest possible short-term
ratings available. The innovation and success
of the ring-fenced structure has also been
recognised with the AWB treasury division
receiving an industry award for the initiative.
Current credit ratings are:
AWB Harvest Finance Limited
Standard & Poor’s:
Moody’s Investors
Service: P-1
AWB Limited
Standard & Poor’s:
A-1+ (short-term)
AA- (long-term)
Outlook: Stable
BBB
Outlook: Stable
Compliance
The AWB Group has fully complied with
recent changes to the Corporations Act 2001
relating to financial services regulation,
obtaining three separate Financial Services
Licences for regulated activities of the Group.
AWB Services Limited, a wholly owned
subsidiary of AWB, attained a Licence
authorising the wholesale financial services
activities in which AWB Harvest Finance
Limited and AWB Commercial Funding
Limited are engaged. This has resulted in
greater administrative compliance measures
being implemented in policies and
procedures relating to those activities.
Outlook
With average grain volumes in 2004, AWB
will seek to retain a strong position in the
harvest finance market by continuing to
innovate and offer a broad range of finance
options that meet varying customer
requirements. Through its Integrated
Business Model, AWB will target new
products for the broader rural lending
market. Good grain volumes and a growing
customer market for risk management
services should also enable AWB to expand its
offering through AWB RiskAssist.
Michael O’Shea
Credit Analyst
21

In 2004, AWB Australia trading
volumes exceeded four million tonnes, an
increase of one million tonnes from 2003.
NPBT* – Grain Acquisition and Trading
Chinese delegation visit the Melbourne Port
Terminal to watch a ship loading.
100
80
($m)
60
40
20
0
2000 2001 2002 2003 2004
* Net profit before tax
22

Grain Acquisition and Trading
Highlights
Achieved a 25% increase in domestically
traded grain, with 2003/04 volumes
reaching more than four million tonnes
Growth of international trading operation,
trading two million tonnes of grain – up
from 1.2 million tonnes in 2002/03
Developed bundled grain, marketing,
finance and risk management packages for
growers, domestic and overseas customers
Introduced a “fund of funds” capital and
risk management approach to the AWB
trading division
Developed new freight business
with China
Increased level of pool volumes sold with
a freight component by 10%, to 45%
AWB trading division has an objective to
develop as a global niche agricultural
commodity trader, leveraging its local
network and knowledge and its global trading
skills. This year, the division began the
introduction of its “fund of funds”
management approach. The system allows
AWB to better manage its risk and generate
optimum results from its capital
management.
Australia trading
Improved crop conditions and continued
volatility in global grain prices provided a
favourable trading environment for the
Australia trading division. While drought
continues to temper the grower appetite for
forward contracting, AWB’s range of flexible
grain acquisition products retained a
significant share of the deregulated domestic
grain market. AWB enhanced its regional
network during 2004, with 50 dedicated grain
marketers now operating as a national grain
acquisition network. AWB has supported this
with tailored training programs, and
initiatives to improve the processes and
systems, underpinning AWB’s customer
management databases. These developments
will allow improved customer segmentation
and tracking, better placing AWB to capitalise
on cross-selling opportunities through the
Integrated Business Model.
In 2004, AWB’s Australia trading volumes
exceeded four million tonnes, an increase of
one million tonnes from 2003. The increases
were achieved across all traded grains –
wheat, barley and canola. AWB worked
closely with more than 50 domestic
customers nationwide.
With an increase in exportable surpluses,
AWB was able to develop its non–wheat
export opportunities in 2004. Increased
volumes of canola, barley and sorghum were
sold into international markets on the Indian
subcontinent, Asia and the Middle East. The
division is focused on developing export
business in non-regulated export grains, and
has invested further resources to grow the
volumes and range of commodities through
AWB – Zen-noh (AZL) – the Tokyo-based
joint venture trading company between AWB
and Zen-noh Corporation. This year, AWB
traded small volumes of cottonseed and bran
with AZL for the first time.
With average production forecast in 2004/05,
Australia trading will pursue domestic growth
opportunities, including sales to the domestic
and intensive livestock industries. Having
diversified its product base in 2004, AWB
will continue to expand its trading base
beyond grains, capitalising on expertise
within the Landmark business to broaden
trading abilities.
International trading
AWB’s international trading business was
established in 2002 as a platform for AWB to
grow its global presence and business.
Through its international trading base in
Geneva, AWB is able to access key markets
on behalf of the AWB National Pool in the
Mediterranean and North African region. In
2003/04, AWB Geneva sold more than one
million tonnes of wheat on behalf of the
AWB National Pool, up sharply from last year
when drought reduced grain volumes.
Total volumes traded by international trading
reached two million tonnes in 2003/04, an
increase from 1.2 million tonnes last year. A
key component of the growth in business has
been the development of the oilseed book.
This year, more than 35% of total grain
volumes traded were soybeans, including the
first exports from South America and the first
business to China.
International trading has also made a strong
contribution through the AWB chartering
division, where, working alongside the
Melbourne office, AWB was able to expand
its global freight services. New physical
freight arrangements have been developed
23

AWB trading division has an objective to develop
as a global niche agricultural commodity trader,
leveraging its local network and knowledge and
its global trading skills.
24

through the AWB Geneva office, both on
behalf of the AWB National Pool, and for
non-Australian grain exports.
In the year ahead, International Trading aims
to continue to diversify products and
markets, and strengthen the skills and
expertise to support this. The business will
target better market coverage, with an aim to
expand its other origin exports through
supply agreements and leveraging its
marketing and trade finance capacity.
Chartering 1
AWB chartering division provides ocean
freight services to the AWB National Pool,
AWB’s Australia trading division and external
customers, generating income via service fees
and trading of freight.
The improved harvest for 2004 provided an
increased volume of grain for the chartering
division to leverage, increasing the physical
freight business. Almost half the grain
volumes sold through the AWB National
Pool during 2004 were sold with a freight
component, exceeding a target of 40%. The
company was able to increase the fleet of
vessels under its charter, secure substantial
new market volumes to China, and
significantly grow freight services to key
wheat markets such as Egypt and Indonesia.
The chartering division is also working to
more closely integrate the resources of its
Geneva and Melbourne offices, which
currently provide a 24-hour, global presence
within the freight market. Through Geneva
Global Freight, AWB is also aiming to
expand its non-pool related business, with
volumes in 2004 exceeding targeted volumes
for the second consecutive year.
The past year for the freight market has been
the most volatile on record, with freight rates
fluctuating by more than 300%. This
presented some unique trading opportunities
for the chartering division within the freight
swaps paper market. Using forward freight
agreements, it was able to execute
discretionary trading strategies in the volatile
market, generating a strong return for the
company.
AWB’s freight trading activities are now being
backed by a new level of position
management, through progressive
implementation of the Value at Risk (VaR)
model. Already in place for the Geneva
business, this model is providing the chartering
division with an objective benchmark against
which it can generate an accurate and
quantifiable measure of risk exposure at any
point in time. AWB plans to roll out the VaR
model across the entire chartering division in
the coming year, which will put the business at
the forefront of risk management within the
global freight industry.
Outlook
Expectation of a less volatile freight market
may limit opportunities and margins for the
chartering division in the forward freight
business in 2005. However, the chartering
division is targeting further growth of the
physical grain freight business, using an
increasing fleet of vessels to provide
competitive freight solutions for an increased
level of both AWB National Pool, and nonpool
grain sales. Reasonable crop production
for 2004/05 will continue to support trading
activity for the trading business. The
integration of Landmark and the enhanced
regional network will contribute to the
strength of the AWB’s trading operations.
With further development of strategic links
with AWB joint venture partners such as
AZL, and the development of international
trading, the company will pursue its objective
of broadening the range of commodities
under its management.
1 Previously reported in Supply Chain and Other Investments.
View of canola growing in Victoria.
25

AWB has an established presence
in some of the world’s biggest and fastest
growing grain markets.
NPBT* – Supply Chain and Other Investments
($m)
10
5
0
-5
-10
-15
-20
-25
2000 2001 2002 2003 2004
* Net profit before tax
26

Supply Chain & Other Investments
Highlights
Record grain receivals by AWB GrainFlow
of 1.8 million tonnes – up from 185,000
tonnes in 2003
Increased receivals at AWB GrainFlow
Dimboola site to 345,000 tonnes, making
it one of the largest inland grain receival
centres in Australia
Continued high level of service to growers
by AWB GrainFlow, with an average
harvest truck turnaround of 33 minutes
across the network
Accreditation of AS 4801 safety
management system for AWB GrainFlow –
the only grain bulk handler in Australia to
achieve this
Increased grain volumes through the
Melbourne Port Terminal from 450,000
tonnes, to 1.3 million tonnes
Doubled market share for Five Star Flour
Mill to 30% of Egyptian premium flour
market
AWB Grain Centre
Gilgandra, NSW
Domestic investments
AWB GrainFlow
AWB GrainFlow is a wholly owned
subsidiary of AWB which operates grain
storage and handling services for the AWB
Group. In 2003/04, the business had four
new grain receival centres commence
operation, including its first ventures in
Queensland. With a total of 21 grain receival
sites operating across the east coast grain belt,
AWB GrainFlow’s grain receivals rebounded
significantly following the drought of last
year. Total grain volumes were 1.8 million
tonnes, a tenfold increase on the previous
year. AWB GrainFlow has out-turned this
grain quickly and efficiently, with a carryout
of less than 250,000 tonnes by the end of
October 2004, in preparation for the new
season harvest.
The growth of AWB GrainFlow’s Dimboola
site continued with receivals of 345,000
tonnes, making it one of the largest inland
grain receival centres in Australia after five
years of operation. AWB GrainFlow has
upgraded its processing systems to improve
grower receipting and allow real-time capture
of receival information. This facilitates better
management of grain through the business
and best use of resources.
The company’s safety management system
was recently accredited to AS 4801 standards.
This is a significant milestone for the AWB
GrainFlow business, which is currently the
only grain bulk handler in Australia to
achieve the accreditation. The company has
also continued its implementation of
standard operating procedures, which assists
management of safety risks, as well as
ensuring operational best practice across each
of its receival sites. AWB GrainFlow will aim
to continue increasing market share based on
efficient facilities, fast turnaround times and
lower costs. Grain volumes should again be
solid in 2004.
Port Investments
Income from the AWB Group’s 50%
investment in Melbourne Port Terminal
improved in 2004, with increased grain
volumes through the facility. Total grain
volumes handled increased from 450,000
tonnes in 2003 to 1.3 million tonnes for the
2004 year. AWB has not extended its
investment in port infrastructure in 2004,
but will continue to explore opportunities
that provide long-tem commercial returns to
shareholders, as well as delivering reduced
costs to the AWB National Pool.
Rail freight
AWB retains leases for two freight trains, the
Waratah which is leased from Freight
Australia, and another train from ATN.
These trains played a significant role in the
grain haulage task from the 2003/04 season.
Offshore investments
AWB has broadened its reach into the global
grain value chain in recent years through
offshore investments that diversify and secure
end-use demand for AWB products. AWB
has an established presence in some of the
world’s biggest and fastest growing grain
markets. In 2004, these investments have
performed well.
Five Star Flour Mills (Egypt)
Five Star Flour Mills Company SAE (FSFM)
is the leading producer of premium grade
flour in Egypt. The mill uses 100%
Australian wheat, and has an established
market share based on a quality product
model in one of the world’s largest flour
consuming nations. AWB is the largest single
shareholder with a 30% interest.
In 2004, FSFM rebounded strongly, with an
increase in the supply of Australian wheat to
the mill of more than 50%. During 2004, the
mill was operating at its full, 1,100 tonnes
per day capacity. The business expanded the
market in Egypt, and increased its share of
the premium flour market to 30%.
27

The growth of AWB GrainFlow’s Dimboola site
continued with receivals of 345,000 tonnes,
making it one of the largest inland grain receival
centres in Australia.
28

The Five Star Feed Mill, located on the same
site, was commissioned in 2003 and has
performed above expectations since. In its
first full year of operation, this state-of-theart
mill has delivered strong operating
margins. It services an expanding market for
industries such as aquaculture and poultry
farms, with opportunities for further growth
within Egypt, and the broader North African
and Middle East region.
AWB – Zen-noh (Japan)
AWB – Zen-noh (AZL) is a joint venture
trading company between AWB and Japan’s
largest agriculture trading company, Zen-noh
Corporation. AWB holds a 51% interest.
Increasingly competitive market conditions
within Japan have placed margin pressure on
the business and prompted increased efforts
to develop a broader range of trade flows
through the joint venture. AWB has provided
additional support to the business to help
diversify the commodity base, and in the past
year has made inroads with trade in sorghum,
canola, cottonseed and wheat bran.
Shenzen Southseas Grain (China)
Shenzen Southseas Grain Industries Limited
(SSGI) is one of the largest and most efficient
flour and feed milling businesses in southern
China. AWB holds a minority 8% stake.
Following market disruptions from the SARS
and the Avarian Flu outbreaks, SSGI
rebounded strongly in 2004 and consolidated
its position in the premium flour blend
market. SSGI is now looking toward further
expansion opportunities in the rapidly
growing southern China market.
Vietnam Flour Mills (VFM)
AWB holds a 17.5% stake in Vietnam Flour
Mills (VFM). In 2004, ownership of VFM
changed, with the major shareholder,
Glowland Limited, increasing its stake to
82.5% of the business. The business is
seeking to increase its market share in the
Vietnamese market, which remains fiercely
competitive and cost focused. The cost focus
nature of the market has prevented AWB
from leveraging its quality model and
generating sales of Australian wheat from the
AWB National Pool. Following a strategic
review of this business, AWB has determined
to divest its interest. The transaction is
expected to be completed in early 2005.
Outlook
While national grain volumes will be down
from 2004, AWB GrainFlow is targeting an
increased share of the market again in 2005,
building on its provision of efficient and cost
effective service for growers and grain
acquirers. With the recovery in Egyptian
economic conditions, signs of strong demand
and the continued economic growth being
forecast for China, AWB is anticipating good
growth in those areas of its offshore
investments.
The Hon. Lynne Kosky,
Minister for Education and Training, Victoria
Andrew Lindberg,
Managing Director AWB
Dr Stephen Henningham,
Australian Consul General, Ho Chi Minh City
Brendan Carter,
Lecturer at William Angliss Institute of TAFE
at the launch of the AWB Centre of Excellence
in Vietnam.
29

Aleeza Iqbal, Corporate Communications Adviser
Employee engagement
Surveyed improvement year on year
(compared to average employee engagement level
achieved by similar sized organisations)
2002 2003 2004
30

Our People
AWB employs over 2,700 people based in
more than 230 AWB-owned locations both
in Australia and internationally. More than
70% of AWB’s employees are located in
regional Australia, making AWB one of the
largest rural employers in the country. AWB
is committed to positioning itself as an
employer of choice across the rural services
sector and in particular, the specialist areas of
financial services, as a key platform in our
strategy to attract and retain a talented
workforce.
The integration of the Landmark business
involved considerable consolidation and
restructuring of all AWB support functions,
as well as some key customer facing groups,
in order to met the company objectives under
the Integrated Business Model. The work of
integrating human resource policies, systems
and processes will continue in 2005.
In support of the AWB Corporate Plan, the
key pillars of the Human Resource
Management strategy in 2004/05 are focused
on building organisational capability, and
continuing to provide a safe and rewarding
workplace.
Left to right:
Anthony Diamante
Chartering Manager
Peter Johnson
Melbourne Port
Reinforcing AWB Capability
The complexity of the AWB business
demands a workforce with diverse and
specialist skills, and people capability is one
of the company’s highest priorities.
AWB recognises that capability of employees
is key to delivering on its corporate
objectives. In 2004/05, AWB will
significantly increase the scope of training
and development for its frontline employees,
particularly in the areas of customer sales and
relationship management. AWB has a
framework for identification and delivery of
training requirements in the business, an
important platform in ensuring AWB’s
capability.
Succession and talent management
AWB has a formal succession planning
process that is managed by senior managers
within the company’s Enterprise Risk
Management (ERM) framework. This
ensures all business critical roles are
succession managed in order to assure
continuity of leadership capability and critical
skills.
Formal monitoring and addressing of
retention risk have resulted in AWB achieving
a 95% retention of key talent in the 2003/04
year, in a competitive labour market.
Successful minimisation of talent turnover
has been achieved at the same time as AWB
has successfully attracted highly qualified
specialists to the organisation.
Driving a Performance Culture
Three factors are considered critical to a well
balanced performance culture in AWB:
Employee engagement
AWB is focused on employee engagement as
a key driver of individual and team
performance. This focus has resulted in a
substantial year on year improvement to a
more than satisfactory and sustainable level.
During 2004/05, AWB will measure and
respond to employee engagement in the
Landmark workforce to ensure that the
positive performance culture attributes of
both businesses are fostered and maintained.
Remuneration
AWB has an overarching Remuneration
Policy which is annually reviewed and
approved by the AWB board. This Policy
deals with:
the broad remuneration principles required
to actively support AWB’s organisational
and people objectives – that is, to attract,
motivate and retain employees. This
philosophy advocates market competitive
fixed pay, appropriate annual incentives for
performance against business targets, plus a
strong emphasis on long-term incentives to
encourage reward for exceptional
performance; and
a strategic approach to setting
remuneration levels and reviewing
incentive and other remuneration
components. The strategy is reviewed
annually, to reflect internal changes or
changes in external market practices.
Further details are provided in the
Remuneration Report on page 53.
Performance Management
The AWB performance management system
is in its third year of operation, and sets out
clear objectives for all employees, informal
and formal performance feedback channels,
and an explicit approach to rectifying
performance problems.
The “Managing for High Performance”
learning program has been designed in-house
and is offered to all new managers and
supervisors, as well as those who wish to hone
this important management skill.
The key challenge for the coming year is to
extend the AWB performance management
system to the Landmark workforce.
31

A Safe and Rewarding Place to Work
In 2003/04 AWB Group has achieved a
number of milestones in occupational health
and safety (OH&S) management, with the
completion of the safety management system
(SMS) for AWB. This SMS has also been
assessed as compliant with AS 4801 (the
Australian Management Standard for
Occupational Health and Safety Management
Systems) and AWB was accredited to AS
4801 in August 2004.
OH&S Achievements
AWB completed the 2003/04 year with a
Lost Time Injury Frequency Rate (LTIFR) of
4.7 – an excellent result that is within the
targeted LTIFR of 5 set for the business for
the same period. This is particularly
noteworthy due to the intensive integration
of the AWB/Landmark businesses which saw
the coming together of two safety cultures
and safety management systems. This SMS is
being further embedded in AWB, with an
implementation strategy to expand this
system across the business for 2004/05.
The OH&S strategy of AWB is supported by
a structured OH&S policy and a set of
Corporate Safety Values. It is a function of
AWB board to oversee the management of
OH&S. In this capacity, AWB has the
following structures in place:
1. a management review function which
reviews OH&S performance at the
executive level on a bi-annual basis;
2. OH&S compliance audits are included in
the internal audit program and are
undertaken annually and reviewed through
the board Audit Committee; and
3. OH&S reports are reported monthly to
the AWB board.
Beyond Work
The focus on occupational health extends
beyond the workplace. AWB has a
comprehensive rehabilitation policy
governing the return to work processes and
expectations for all AWB employees returning
from work related and non work related
injury or illness.
Managing Industrial Harmony
AWB continues to engage in a pro-active
manner with all unions and representatives of
unions associated with AWB workplace
activity. This approach includes the active
support of an employee advocate, and has
enabled AWB to achieve some key workplace
change initiatives without business disruption
or interruption.
Lost Time Injury Frequency Rate
2001/02
2002/03
2003/04
LTIFR
Target
7
6
5
4
3
2
1
0
AWB Group AWB Limited Landmark
32

More than 70% of AWB’s employees are located
in regional Australia, making AWB one of the
largest rural employers in the country.
AWB Supporting its People
AWB’s values are:
1. we are accountable for our decisions,
actions, and performance;
2. we act with integrity and treat others with
respect;
3. we understand the value and importance of
teamwork; and
4. we initiate the creation of value for our
customers.
Intrinsic in these values is AWB’s focus on the
responsibility to effectively and consistently
address the health and wellbeing of its people.
In 2003/04, AWB has invested in a range of
support and policy infrastructure to meet the
needs of the workforce.
Workplace Diversity
AWB will further develop its Workplace
Diversity policy in 2004/05 with a mix of
face to face and e-learning programs. AWB
also seeks to improve workplace culture
through a clearly defined code of conduct
and through formal feedback systems.
Work-life balance
AWB acknowledges that, from time to time,
employees will have family responsibilities
that can conflict with work demands. The
AWB Work-life balance policy exists within
the broader framework of the Workplace
Diversity Policy, which is approved annually
by the AWB Limited board.
Employee Assistance Program (EAP)
In 2003/04, AWB fully implemented an
Employee Assistance Program that is a
professional, confidential counselling service
for employees and their immediate family
members. It provides employees an avenue
for advice and support by an independent
professional, and is designed to assist
employees (and their immediate family
members) with problems impacting their
general wellbeing and work performance.
AWB has a rapidly changing and growing
business, and has a stable and capable human
resource management infrastructure to
support the achievement of its business
objectives.
Left to right:
Kerrin Gleeson
Pricing Strategist
Andrew Tyas
Logistics Analyst
33

We recognise the importance of
supporting and actively contributing to the
community that we live and work in.
Matt Holgate
State Grain Manager, Victoria
Ian Cornford, farmer, Queensland
34

Our Social Commitment
Together with the Landmark business, AWB
has a long and proud tradition of serving
rural Australia which stretches back more
than 150 years. As part of the fabric of
regional Australia, we recognise the
importance of supporting and actively
contributing to the community that we live
and work in, and, as Australia’s leading
agribusiness, we are in a unique position to
be able to make a difference through our
activities and the activities of our people.
Our contribution to the rural community
and environment is based on three key
platforms:
agriculture industry leadership;
rural communities; and
environment and agricultural sustainability.
Agriculture Industry Leadership
AWB recognises the importance of leadership
to the future of the Australian agricultural
industry, and is working to foster this across
all aspects of agriculture – from grower
representative bodies to cropping groups and
development programs for primary
producers.
The company is an active supporter of farmer
representative groups across Australia,
providing assistance for research and advocacy
work on behalf of farmers. These groups play
an important role in representing growers’
interests and fostering industry leadership and
development.
To enhance this, AWB has formed 14 Grower
Consultative Groups (GCGs) and the
Managing Director’s Roundtable – two
unique initiatives which develop the links
between AWB, grain growers and the regional
communities we operate in.
Both are mechanisms for two-way
communication which assist the company
meet the needs of its stakeholders, but also
fostering leadership at the community level
and provide these farmers with a platform to
develop their leadership skills. In addition to
this, AWB actively encourages grower
involvement in their industry by coordinating
a program of grower group visits to its head
office. In 2004, AWB developed specific
programs and tours for more than 25 groups,
involving more than 400 participants. This
included targeted programs for rural women
and young farmers.
AWB is a significant contributor to the
Nuffield Farming Scholarship Program. This
program targets dynamic young Australian
farmers and provides funding for successful
candidates to travel internationally, expand
their personal horizons and learn from
leading agriculturists from around the world.
In August 2004, the inaugural AWB Young
Leaders Conference was held in Melbourne.
The aim of the event was to foster young
farm leaders by growing their skills and
experience base, so that the industry has a
strong platform of leadership for the future.
More than 80 young grain growers attended
the conference from around Australia.
Rural Communities
As Australia’s leading agribusiness, AWB has a
large investment in the future of the
agricultural sector and in the broad
development of regional Australia. More
than 70% of AWB’s people are based in rural
areas and the company is active in finding
ways that it can help support those
communities.
Rural sport
At the heart of many rural communities are
its sporting teams, and the company is
strongly committed to the support and
development of rural and regional sport.
This extends to involvement in Australian
Rules country football championships in a
number of States; extensive support for
country Rugby Union at the regional and
state level; and numerous tennis, cricket, golf
and lawn bowls country events.
Support and services
An important part of a vibrant and healthy
rural community is the provision of adequate
infrastructure and essential services. Through
Landmark, AWB maintains a significant
charity partnership with the Queensland
Royal Children’s Hospital Foundation
(RCH). Landmark’s involvement with the
RCH Foundation commenced in 2002 with
the Landmark Charity Steer Auction at the
Royal Brisbane Show. More recently, the
company launched the “Pulling up Socks for
Sick Kids” fundraising program, which,
through donating the proceeds of the sale of
Merino wool socks, Landmark raised more
than $120,000 to help the treatment of sick
kids at the hospital.
35

The issue of sustainable agriculture is at the
heart of our business and the long-term
prosperity of our farmers.
Landmark Queensland
Heelers v Landmark
NSW Cockatoos
36

Social service providers While not a producer or manufacturer of eTree
AWB also contributes between $70,000 to goods in our own right, AWB believes the AWB is a foundation member of the
$80,000 annually to selected charities which issue of sustainable agriculture is at the heart Computershare eTree initiative. Launched in
contribute to rural communities. Charities of our business and the long-term prosperity 2004, eTree encourages AWB shareholders to
which have benefited from this initiative of our farmers. Specific initiatives have register their email address for electronic
include: included: communications. It allows shareholders to
The Variety Club of Australia;
Angel Flight;
Lifeline;
The Royal Flying Doctor Service; and
Salvation Army.
Environment and agricultural
sustainability
AWB is committed to managing its
operations in an environmentally responsible
manner. This is supported by the AWB
Environmental Policy, and the development
of an Environmental Management System in
line with International Environmental
Management Standard ISO 14001. This
review has assisted with identification of
environmental risks associated with AWB’s
operations, and the same review process is
now being undertaken for the Landmark
business. AWB also subscribes to the Agsafe
industry code of conduct for the safe
transport, handling and storage of
agricultural and veterinary chemicals.
Dryland salinity
In a partnership with the Cooperative
Research Centre for Plant-based Manager of
Dryland Salinity (CRC), Landmark is
involved in a major program directed towards
finding long-term solutions for this key issue.
The CRC aims to provide new plant-based
land use systems to minimise the impact of
dryland salinity. With Landmark’s direct
contact with farmers, it plays a key role in
disseminating vital information to the
farming community and maximising the
impact of the research. This assists in
ameliorating the impact of salinity, and
improving the long-term productivity,
profitability and sustainability of farmers and
their communities. The next phase of the
program is full-scale extension of the project
across the four southern States, specifically
promoting lucerne and perennial pastures as
significant plants to utilise rainfall and
prevent rising water tables.
minimise postal communications and save
paper, in return for increased reforestation
activities. For every email registration
captured by the eTree campaign, a donation
is made by AWB to Landcare Australia. The
funds will be distributed to support landscape
change projects in the State where the
registering shareholder resides. Some of the
projects earmarked for funding under the
eTree initiative include the “Grow West”
project at Bacchus Marsh in Victoria, the
Holbrook Rebirding project in New South
Wales and the Fitzgerald Biosphere Reserve
project in Western Australia.
To date, nearly 3,000 AWB shareholders have
registered for eTree. Shareholders interested
in supporting eTree can register their email
address by visiting www.etree.com.au/awb
Left to right:
Terry Aucher, Head of Credit and
Trade Finance
Nick Farr-Jones, Former Wallabies
Captain
Barry Smith
Participating in Variety Club Bash
37

Executive Profiles
1
2
3
4
5
1. Andrew Lindberg
Managing Director, 51, BComm, BSc, MBA,
FAICD
Joined AWB in 2000. Mr Lindberg is responsible for
the management of AWB and is a director on the
Boards of AWB and AWBI. Mr Lindberg has senior
management experience in both the private and
public sectors, at Federal and State levels. Prior
positions have included senior management
responsibilities in manufacturing, Federal industry
policy development, insurance and leading key sector
financial reforms.
2. Paul Ingleby
Chief Financial Officer, 53, BA (Accounting), CA
Joined AWB in 1998. Mr Ingleby is responsible for
finance and administration, treasury and trade
finance. Before joining AWB, he had experience as
Chief Financial Officer of a major diversified,
agriculturally focused corporation and a bank. Mr
Ingleby’s previous positions have been in banking and
merchant banking (where he was involved in the
analysis, valuation and sale of businesses in Australia,
New Zealand and Hong Kong), chartered accounting
(corporate advisory and audit) and government
(companies and securities regulation and corporate
crime investigation).
3. Jill Gillingham
General Manager, Supply Chain, Technology and
Business Processes, 54, BEc, MBA, MAICD
Joined AWB in 2000. Ms Gillingham is responsible
for information systems, supply chain management
and the grower service centre. She has a broad range
of general management experience, having held
executive positions and been responsible for major
business operations in the general insurance, workers
compensation and occupational health and safety
sectors. Ms Gillingham has also been responsible for
the development and implementation of large IT
initiatives within the insurance industry. Before
joining AWB, Ms Gillingham held the position of
Group General Manager Operations at the Victorian
WorkCover Authority for three years.
4. Marcus Kennedy
General Manager, Financial Services, 45, BSc
(Hons), MSc (Geophysics), MBA, MAICD, ASIA
Joined AWB in 2002. Mr Kennedy is responsible for
financial services across both the AWB and Landmark
businesses, insurance and product development. He
has extensive management experience in both retail
and wholesale financial services and across many
management functions, including sales and customer
management, strategy and product development.
Previously, he worked in a number of leadership roles
with Westpac, including wealth management,
corporate banking and mortgage businesses. Prior to
this, Mr Kennedy worked in Europe as a consultant,
and in investment banking with Wardley Limited
(Hong Kong and Shanghai Banking Corporation) and
Westpac. Prior to joining the financial services
industry, he was a geophysicist and financial analyst
with Exxon Corporation.
5. Peter Geary
General Manager, Trading and Commodities, 44,
BBus, GradDip (Marketing)
Joined AWB in 1985. Mr Geary is responsible for
domestic and global trading, international sales and
marketing, risk management products for growers and
end-users and chartering. His previous positions
within AWB have included General Manager of
National Wheat Pools, policy and export sales in
Africa, Europe, Middle East and South America, as
well as the management of AWB’s overseas offices in
Europe and the United States. Before joining AWB,
Mr Geary was employed with the Grain Elevators
Board of Victoria (now GrainCorp Limited) for a
period of four years. Mr Geary has a family farming
background in north east Victoria.
6. Sarah Scales
General Manager, AWB (International) Limited,
38, BAgSc
Joined AWB in 1992. Ms Scales is responsible for
managing the AWB National Pool and the Single
Desk system. Her recent positions within AWB
include responsibility for pricing and risk
management strategies and the execution of the
commodity hedge book in New York. She has also
worked in the domestic trading division, trading
pulses and wheat. Before joining AWB, Ms Scales
worked with Cargill Australia.
38

7. Richard Fuller
General Manager, Executive and Company
Secretary, 45, BA (Hons), PhD (Political Science)
Joined AWB in 2000. Dr Fuller is responsible for the
management of the Office of the Managing Director
and is the Company Secretary. Before joining AWB,
he held senior management roles in the insurance
industry and positions as a lecturer with the
University of Melbourne and RMIT.
8. Charles Stott
General Manager, Rural Services, 45, DipApp
Sc (Ag)
Joined AWB in 2000. Mr Stott is responsible for
Landmark rural services, which includes procurement,
merchandise, fertiliser, wool, real estate, livestock and
AWB’s seeds business. Prior to this, Mr Stott was
responsible for strategy and business development,
investments, mergers and acquisitions. Previously, he
was General Manager, International Sales and
Marketing. Mr Stott has worked with BHP
Petroleum, where his positions included Project
Director and International Business Development
Manager. Prior to BHP, he was with the Australian
Wheat Board and held various roles including
Marketing Manager for the Middle East, Europe and
Africa. Mr Stott has extensive international
experience in trade finance, risk management,
business development and project management across
a broad range of industries including agriculture,
petroleum and minerals.
9. Michael Thomas
General Manager, Corporate, 37, BAgSc, GradDip
AgEc, MEc, ASIA, GAICD
Joined AWB in 1998. Mr Thomas is responsible for
corporate development (mergers and acquisitions and
corporate planning), human resources, stakeholder
relations (media, government, grower and investor
relations) and marketing. Previously, he held the
positions of General Manager, Stakeholder Relations
and Head of Investor Relations. Before joining AWB,
he was the Executive Officer at SA Farmers
Federation. Prior to this, Mr Thomas was the senior
economist at Primary Industries South Australia. He
was also an economist with private and public
consulting companies undertaking consultancies in
Asia and the Pacific region.
10. John Maher
General Manager, Operations, 42, BAgSc (Hons),
MBA, GAICD
Joined Landmark in 1994. Mr Maher is responsible
for the national operations of Landmark. Prior to the
acquisition of the Landmark rural services business by
AWB in August 2003, Mr Maher was General
Manager, Network Operations with Wesfarmers
Landmark. Mr Maher has also been Regional
Manager for Southern Region and General Manager –
Livestock. Prior to joining Wesfarmers, Mr Maher
was the Head of International Livestock Marketing for
the Australian Meat and Livestock Corporation. In
that role, he had accountability for the development
of the industry’s marketing strategy in Australia's Asia
Pacific, Middle East and North African livestock
markets.
6
7
8
9
10
39

Corporate Governance
Governance at AWB
AWB’s board and management are committed to
conducting the business of AWB in accordance with a
strong corporate governance framework and rigorous
standards of ethical conduct.
AWB benchmarks itself against the ASX Corporate
Governance Council's Principles of Good Corporate
Governance and Best Practice Recommendations, and
AWB’s governance systems and practices currently meet all
of the Best Practice Recommendations (ASX
Recommendations). In this corporate governance statement,
the descriptions of AWB’s corporate governance practices
have been linked to each of the ASX Recommendations.
AWB's constitution (available on AWB’s website,
www.awb.com.au) is also a key governance document. The
constitution was framed by the Australian Government in
consultation with the Grains Council of Australia as part of
the process of privatising the Australian Wheat Board,
effective in July 1999. AWB's systems and practices are
designed to ensure compliance with AWB's constitution at
all times.
In May 2004, AWB launched the Corporate Governance
section on its website. The Corporate Governance section of
the website discloses a considerable amount of information
about AWB’s corporate governance systems and practices.
Role of the board
The board is responsible for the overall governance of AWB
and its strategic direction. This includes setting goals,
monitoring performance, and ensuring AWB’s internal
control and reporting procedures are effective and ethical
and that AWB’s strategic direction provides value for
shareholders.
Regardless of who elects or appoints a director, each director
is obliged to act in the interests of AWB as a whole.
Although directors may be elected by particular
shareholders, directors are not considered the servants or
agents of particular groups of shareholders or required to
follow directions of or requests from any group of
shareholders (whether constituted by class or region).
AWB has adopted a formal board charter, which is reviewed
and updated on an annual basis. The division of
responsibilities between the board and management is set
out in formal delegations and a system of board reserved
powers. Summaries of both the board charter and the
system of reserved powers are available in the Corporate
Governance section of AWB’s website.
(ASX Recommendation 1.1)
Standard Terms of Appointment
Upon appointment to the board, each director receives a
letter of appointment which sets out the key terms and
conditions of their appointment.
The managing director, the chief financial officer and other
key executives all have letters of appointment, or contractual
equivalents, describing their terms of office, duties, rights
and responsibilities and entitlement on termination.
(ASX Recommendation 1.1)
The Composition of the board
The constitution of AWB contains provisions which ensure
that 11 of the 12 directors are non-executive directors. This
ensures that there are a sufficient number of non-executive
directors to:
bring an independent view to the board’s deliberations;
help the board (and the chairman) provide the company
with effective leadership and ensure that the company is
competently run in the interests of all shareholders; and
foster the continuing effectiveness of the managing
director and management.
The board of AWB comprises:
seven A class directors, elected by the A class shareholders
in various regions as follows:
– NSW/ACT – two A class directors;
– WA – two A class directors;
– SA – one A class director;
– VIC/TAS – one A class director;
– QLD/NT – one A class director;
two B class directors (elected by B class shareholders);
two additional directors (appointed by the A class
directors); and
the managing director.
The constitution requires all of the directors to elect an A
class director as chairman.
The profiles of the directors at the date of this report,
including a description of their skills, experience and
expertise relevant to the position of director, are set out on
pages 46 – 47.
The board met 14 times during the financial year. Refer to
page 58 for details of the attendance by directors at those
meetings.
(ASX Recommendations 2.2, 2.3 and 2.5)
40

Independence
All of the current 11 non-executive directors of AWB
Limited are independent, being independent of
management and having no business or other relationship
that could compromise their autonomy.
The board has adopted the definition of independence set
out in Box 2.1 of the ASX Recommendations. However, the
board has determined that a director is not considered to
lack independence by reason only that the director (either
directly or indirectly though entities associated with the
director) has a material personal interest in the sale of wheat
or other grain to a company in the AWB Group and/or is a
customer for products or services of a company in the AWB
Group. The board has not set materiality thresholds and will
consider the circumstances on a case by case basis.
The constitution requires A class and B class directors to retire
and submit themselves for re-election at the third annual
general meeting following their initial (and each subsequent)
appointment. An additional director may be appointed for a
term of up to three years, and may be considered for reappointment
at the expiry of the previous term.
At the date of this report, the period of office of each
director of AWB Limited (rounded to the nearest six
months) is as follows:
Brendan Stewart (chairman)
Andrew Lindberg (managing director)
Kerry Sanderson
Chistopher Moffet
Warrick McClelland
John Simpson
Robert Barry
John Thame
Xavier Martin
Brendan Fitzgerald
Peter Polson
Steve Chamarette
5 years
5 years
6 years
6 years
6 years
6 years
6 years
6 years
2 years
2 years
2 years
1 year.
The constitution limits the tenure of A class directors to the
period expiring at the ninth consecutive annual general
meeting after their initial appointment (other than an A
class director who has acted as chairman who may hold
office until the twelfth consecutive annual general meeting
after their initial appointment). The constitution limits the
tenure of an additional director to the period expiring at the
sixth consecutive annual general meeting after their initial
appointment. The constitution does not currently limit the
tenure of B class directors.
(ASX Recommendations 2.1 and 2.5)
Board Committees
The board has several committees of its members to support
effective corporate governance. These committees are
advisory in nature and do not exercise any powers.
Audit Committee
The role of the Audit Committee is documented in a
charter which is approved by the board. The principal
functions of the Committee are to:
monitor AWB’s Risk Management Program on an overall
basis. (The Group Corporate Risk Committee has
responsibility for monitoring risk management activities
for market (commodity price, currency, interest rate) and
credit risks);
ensure that the accounting policies and practices are
appropriate and in accordance with generally accepted
practices including such advice and information which
the external and internal auditors are responsible for
providing to the Committee from time to time;
ensure that the financial statements of AWB Limited
accurately reflect a true and fair position of its financial
operations;
ensure that proper internal controls exist in relation to
AWB’s financial transactions;
review risk management practices and processes and
monitor the control of corporate operating risks and
exposures;
monitor policies and procedures to ensure compliance
with statutory and legal, financial and corporate
governance responsibilities and overall efficiency and
effectiveness of AWB’s operations;
monitor and advise on the warranties provided by AWB
Limited to AWB (International) Limited with respect to
the operations and financial reports of the AWB National
Pool;
provide through regular meetings, a forum for
communication between the board, senior financial
management and the internal and external auditors;
provide an advisory and liaison role for the AWB Limited
board in relation to audit advice, risk management advice
and information with relevant external bodies; and
monitor audit recommendations to ensure that they are
implemented.
The constitution of AWB (article 3.1(f )) requires the board
to ensure that separate accounts are prepared for the
business of AWB (International) Limited – that is, in
relation to the AWB National Pool. The accounts of the
AWB National Pool are reviewed by the Audit Committee
and the board of AWB (International) Limited.
The Committee’s charter requires that it consist of at least
three non-executive directors, with qualifications as to
independence, financial expertise and financial literacy as set
out in the commentary and guidance to the ASX
Recommendations.
The members of the Audit Committee are Mr Robert Barry
(Chair), Mr Brendan Stewart (ex-officio), Mr Brendan
Fitzgerald, Mr Xavier Martin, Mr Warrick McClelland and
Mr John Thame. Members of the committee are financially
literate and the chairman, Mr Robert Barry, and Mr John
Thame have extensive financial experience. (Refer to pages
46 – 47 for details of the qualifications and experience of
committee members.)
The Audit Committee met eight times during the financial
year. Refer to page 58 for details of the attendance by
41

committee members at those meetings. Generally, some or
all of the managing director, the chief financial officer, the
chief risk officer, the company secretary, a representative of
internal audit and a representative of the external auditor
were also present for at least part of each meeting at the
invitation of the Committee. As part of this process, the
Committee meets with both the internal and external
auditors without the managing director or other members of
management present.
The Audit Committee Charter is available in the Corporate
Governance section of AWB’s website.
The company’s external auditors, Ernst & Young, were
appointed in September 1998, prior to AWB’s listing on the
Australian Stock Exchange (ASX) on 22 August 2001. The
Audit Committee is responsible for nominating future
external auditors. A description of the arrangements for the
selection and appointment of the external auditor is
available in the Corporate Governance section of AWB’s
website.
(ASX Recommendations 4.2, 4.3, 4.4 and 4.5)
Group Corporate Risk Committee
The role of the Group Corporate Risk Committee is
documented in a charter which is approved by the boards of
directors of AWB Limited and AWB (International)
Limited. The principal functions of the Committee are to:
act as an advisory Committee of both the AWB Limited
board and the AWB (International) Limited board on
discharging each boards’ responsibilities as they relate to
policy, guidelines, controls, management and reporting of
market and credit risks affecting the AWB Group (both
AWB Limited and AWB (International) Limited);
provide, through regular meetings, a forum for
communication between the AWB Limited and AWB
(International) Limited boards and senior management
on market and credit risk management issues; and
provide an advisory and liaison role for the AWB Limited
and AWB (International) Limited boards in relation to
advice and information relating to market and credit risk
management matters. This role is co-ordinated with the
Audit Committee’s role of monitoring the Risk
Management Programme on an overall basis.
The Committee’s charter requires that at least three nonexecutive
directors of AWB Limited should be members of
the Committee, at least one of whom should also be a
director of AWB (International) Limited and that, where
possible, the chair of the Committee should be a director of
both AWB Limited and AWB (International) Limited.
The members of the Group Corporate Risk Committee are
Mr Peter Polson (Chair) (a director of both AWB Limited
and AWB (International) Limited), Mr Brendan Stewart
(ex-officio), Mr Andrew Lindberg, Mr Steve Chamarette,
Mr Christopher Moffet and Mrs Kerry Sanderson. (Refer to
pages 46 – 47 for details of the qualifications and experience
of committee members.)
The Group Corporate Risk Committee met six times during
the financial year. Refer to page 58 for details of the
attendance by committee members at those meetings.
A summary of the Group Corporate Risk Committee
Charter is available in the Corporate Governance section of
AWB’s website (www.awb.com.au).
Remuneration Committee
Information about the Remuneration Committee is set out
in the Remuneration Report which is incorporated in the
Directors’ Report (page 53).
(ASX Recommendations 9.2 and 9.5)
Nomination Committee
The role of the Nomination Committee is documented in a
charter approved by the AWB Limited board. The principal
function of the Committee is to advise the boards of AWB
Limited and AWB (International) Limited on membership
and the making of new appointments. In particular, the
Committee advises on:
the composition of the board and advice to be given by
the board to shareholders in accordance with articles
19.15 and 19.18 of AWB’s constitution;
the range of skills available on the board and appropriate
balance of skills for future board membership;
the appointment of an external expert to advise on the
composition of the board and candidates for election;
identification of prospective candidates for positions of
director;
recommendations by the board to shareholders in
connection with board elections to enable shareholders to
effectively discharge their function under article 19.15 of
AWB’s constitution;
implementation of the election process generally; and
succession of the chairman.
The Committee’s charter requires that the Committee
consist of the chair of the AWB Limited board and two
non-executive directors of AWB. The non-executive
directors are to consist of one A class director and one B
class or additional director.
The members of the Nomination Committee are Mr
Brendan Stewart (Chair), Mr Robert Barry and Mr Xavier
Martin. (Refer to pages 46 – 47 for details of the
qualifications and experience of committee members.)
The Nomination Committee met six times during the
financial year. Refer to page 58 for details of the attendance
by committee members at those meetings.
A summary of the Nomination Committee Charter is
available in the Corporate Governance section of AWB’s
website. Also available on the website is a description of the
procedure for the selection and appointment of new
directors to the board, which includes the policy of the
Nomination Committee for the appointment of directors.
(ASX Recommendations 2.4 and 2.5)
42

Services Agreement Committee
The Services Agreement is the contract under which AWB
Limited, through its subsidiary AWB Services Limited,
provides services to AWB (International) Limited.
The role of the Services Agreement Committee is documented
in a charter which is approved by the AWB Limited board.
The principal functions of the Committee are to:
review the Services Agreement;
negotiate any amendments to the Services Agreement
with the Compliance Committee of the AWB
(International) Limited board; and
make recommendations to the AWB Limited board on
the Services Agreement.
The Committee’s charter requires that the membership of
the Committee is to be drawn from directors who are not
also directors of AWB (International) Limited.
The members of the Services Agreement Committee are Mr
John Simpson (Chair), Mr Steve Chamarette, Mr Brendan
Fitzgerald, Mr Warrick McClelland and Mrs Kerry
Sanderson. (Refer to pages 46 – 47 for details of the
qualifications and experience of committee members.)
The Services Agreement Committee met twice during the
financial year. Refer to page 58 for details of the attendance
by committee members at those meetings.
Investment Committee
The role of the Investment Committee is documented in a
charter approved by the board. The Committee was established
to oversee, on behalf of the AWB Limited board, major
acquisitions and the successful integration of these acquisitions.
The Committee’s charter requires that the Committee
consist of the chairman, the managing director and up to
four other directors.
The members of the Investment Committee are Mr
Brendan Stewart (Chair), Mr Andrew Lindberg, Mr Robert
Barry, Mr Christopher Moffet, Mr Peter Polson and Mr
John Thame. (Refer to pages 46 – 47 for details of the
qualifications and experience of committee members.)
The Investment Committee met four times during the
financial year. Refer to page 58 for details of the attendance
by committee members at those meetings.
Board Performance
Every 18 months to two years, the boards of AWB Limited
and AWB (International) Limited conduct formal reviews of
their performance in meeting shareholder and other
stakeholder expectations. The chairman also discusses with
each individual director his or her contribution to the board.
The most recent performance reviews took place during the
reporting period.
A description of the performance evaluation process of the board,
its committees and individual directors and key executives is
available in the Corporate Governance section of AWB’s website.
(ASX Recommendation 8.1)
Director Education
AWB provides assistance to directors of AWB Limited and
AWB (International) Limited who wish to complete the
Australian Institute of Company Directors’ education
program and other programs which can be shown to add
value to the director’s role. In addition, AWB holds several
in-house seminars each year to update directors on issues
relevant to their position as directors.
Independent Legal Advice and Access to
Company Information
Directors of both AWB Limited and AWB (International)
Limited are entitled to any information they need or require
from their respective companies to exercise their functions
and to fulfil their duties as directors and, subject to prior
approval by the chairman (which is not to be unreasonably
withheld), may seek independent legal advice at the
company’s expense on any issue submitted to the board.
(ASX Recommendation 2.5)
Remuneration Policy
Information in relation to AWB’s remuneration policy and
details about the remuneration paid to directors and
executives are set out in the Remuneration Report
incorporated in the Directors’ Report on pages 53.
(ASX Recommendations 9.1, 9.3, 9.4 and 9.5)
Share Dealing by Directors
The board of AWB Limited has adopted Share Dealing
Guidelines which restrict share trading by directors, AWB
managers, AWB staff with financial reporting responsibilities
and their associates to specified “window periods”.
The window periods are as follows:
(i) six weeks commencing two days after announcement of
the half year results;
(ii) six weeks commencing two days after announcement of
the annual results;
(iii) six weeks commencing two days after the company’s
annual general meeting;
(iv) in the period of a qualifying prospectus, six weeks from
the date of the allotment of shares; and
(v) any other period, of such duration, as determined by the
board of AWB Limited from time to time.
The guidelines make clear that prohibitions on insider
trading must be complied with at all times. The guidelines
also prohibit dealing in AWB shares on a short-term basis by
directors and AWB management.
A summary of the Share Dealing Guidelines is available in
the Corporate Governance section of AWB’s website.
(ASX Recommendations 3.2 and 3.3)
43

Continuous Disclosure
AWB Limited has implemented Continuous Disclosure
Guidelines to ensure that AWB Limited meets its
continuous disclosure obligations under the ASX Listing
Rules and the Corporations Act.
Under these guidelines, information which may have a
material effect on the price or value of AWB Limited’s
securities is monitored and referred to a Continuous
Disclosure Coordinator. The Continuous Disclosure
Coordinator is responsible for examining the material to
determine whether the matter must be disclosed and may
refer the matter to AWB’s General Counsel or external
advisers to determine whether consideration is required by
the managing director, chief financial officer or the board.
A more detailed summary of the Continuous Disclosure
Guidelines is available in the Corporate Governance section
of AWB’s website.
(ASX Recommendations 5.1 and 5.2)
Conflicts and Declarations of Interests
The boards of AWB Limited and AWB (International)
Limited have procedures in place 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 their respective companies.
Identification and Management of Significant
Business Risks
AWB has in place a comprehensive monitoring,
management and reporting framework that allows business
risks to be identified, managed and overseen in a timely and
efficient manner. AWB actively mitigates risks and optimises
AWB’s resources not only to protect the company but also
to provide a sound return to shareholders commensurate
with the risk profile adopted.
AWB has implemented an Enterprise-wide Risk
Management (ERM) system that provides a comprehensive
risk profile of the company and allows for formalised ongoing
risk monitoring and reporting to the company’s
Executive Leadership Group, the AWB Group Corporate
Risk Committee, the AWB (International) Limited board
Compliance Committee, the board Audit Committee and
the boards of both AWB Limited and AWB (International)
Limited.
The internal audit plan is designed to be risk focused and is
aligned with the ERM risk profile. It takes into
consideration the company’s strategic initiatives, and
provides assurance on risks and their control status to the
board Audit Committee. The internal audit function is
outsourced to a professional firm, PricewaterhouseCoopers,
and is managed in line with the key objectives of AWB’s
Corporate Risk Unit.
The managing director and the company’s Executive
Leadership Group are responsible for managing risk and
reporting to the board and board committees. A key feature
of this arrangement is the role of the chief risk officer (as
head of the Corporate Risk Unit). The chief risk officer
reports to company’s Executive Leadership Group for risk
purposes and also has an independent reporting line to the
Audit Committee, the Group Corporate Risk Committee
and the AWB (International) Limited Compliance
Committee. The Corporate Risk Unit continually monitors
the company’s risk profile, particularly that of the trading
activity, and has authority to report to any level of executive
management or the board any significant concerns that may
arise. This is particularly so of issues that arise outside of the
formal reporting timetable.
Annual financial budgets are compiled and submitted by
management to the board for approval. Monthly reports
from the chief financial officer and managing director are
provided to the board for oversight of financial and nonfinancial
risk exposures and performance.
Issues considered worthy of further attention by the board
are managed through the use of a corporate action list,
controlled by the company secretary. This is used to register
and manage requests of management raised by the board of
directors.
Risk mitigation is also undertaken by an insurance program
managed by the Corporate Risk Unit. It is continually
monitored and enhanced to match the company’s changing
business profile, and is also regularly reported on to the
board.
AWB is currently developing a group-wide Market Risk
Control Policy. This policy will form a centralised market
risk control framework and consolidated basis for the
management, control, oversight and assurance around
AWB’s group-wide market risk activities.
A description of AWB’s risk management policy and
internal compliance and control system is available on the
Corporate Governance section of AWB’s website.
The managing director and the chief financial officer have
stated in writing to the board that:
the company’s financial reports present a true and fair
view, in all material respects, of the company’s financial
condition and operational results and are in accordance
with relevant accounting standards; and
the above statement is founded on a sound system of risk
management and internal compliance and control, which
implements the policies adopted by the board, and that
system is operating efficiently and effectively in all
material respects.
(ASX Recommendations 4.1, 7.1, 7.2 and 7.3)
Corporate Ethics and Code of Conduct
The boards of AWB Limited and AWB (International)
Limited are committed to clearly promoting and
demonstrating that their business affairs and operations are
at all times being conducted legally, ethically and in
accordance with the highest standards of integrity and
propriety. This is a fundamental principle of AWB’s
operations and business affairs. The AWB Corporate Ethics
and Code of Conduct policy is based on this principle and
44

its observance provides the foundation on which the
company’s reputation with growers, customers, suppliers and
stakeholders is based.
The Corporate Ethics and Code of Conduct policy
(available in the Corporate Governance section of AWB’s
website) sets out the values, responsibilities and obligations
of board members and all employees of AWB.
(ASX Recommendations 3.1, 3.3 and 10.1)
Occupational Health and Safety Policy
AWB Limited is committed to providing and maintaining a
healthy and safe working environment for all people
attending AWB’s workplace and recognises its obligations
under the applicable occupational health and safety
(OH&S) legislation.
AWB has an integrated policy to address OH&S issues
which is reviewed regularly to ensure that AWB maintains
“best practice” procedures in relation to OH&S issues.
In 2004, AWB became the first business in the grains
industry to achieve AS 4801 accreditation, the Australian
Management Standard for OH&S management systems. AS
4801 accreditation requires that AWB, at the very
minimum: meets best practice OH&S standards; has an
OH&S management system which is externally and
independently assessed against best practice criteria; has a
method to assess the implementation of its OH&S
management system throughout the organisation externally
and independently; and demonstrates workplace corporate
responsibility. AWB is now seeking the same level of
accreditation for AWB’s Landmark business.
Environmental Policy
AWB’s Environmental Policy states that:
the company is committed to sustainable development;
environmental, health, safety and community
responsibilities are integral to the company’s business
operations;
AWB employees are encouraged to be pro-active in these
matters; and
accountability for the environment, health and safety is a
core value of the company.
The directors of AWB Limited and AWB (International)
Limited also contribute to the community in an individual
capacity. These activities range from contributing their time
and experience to charitable organisations, research
foundations, Rotary, land care groups and education
foundations and associations through to volunteering for the
local fire service.
Reporting to Shareholders
The board aims to ensure that AWB Limited’s shareholders
are informed of all major developments affecting the
company.
Information is regularly communicated to shareholders via
regular announcements to the ASX in accordance with
AWB’s continuous disclosure obligations, media releases,
periodic mail-outs and grower briefing meetings.
Information is also freely available from AWB’s Investor
Centre on its website www.awb.com.au
In addition, a copy of the Annual Report is distributed to all
shareholders and is available from the company’s website.
The board ensures that the Annual Report accurately
includes all relevant information about the company
including details of its operations, future development and
any disclosures required by the Corporations Act and the
ASX Listing Rules.
The board encourages full participation by shareholders at
the annual general meeting to ensure a high level of
accountability and to ensure that shareholders remain
informed about AWB Limited’s strategy and goals.
Important issues are presented to shareholders as single
resolutions.
AWB’s external auditors, Ernst & Young, are invited to
attend the annual general meeting to answer shareholder
questions about the conduct of the audit and the
preparation and content of the auditor’s reports.
Further information about AWB’s arrangements to promote
communications with shareholders, including by electronic
means, is available in the Corporate Governance section of
AWB’s website (www.awb.com.au).
(ASX Recommendations 6.1 and 6.2)
Corporate Social Responsibility
AWB was one of 26 companies that participated in the
inaugural Australian Corporate Responsibility Index, an
initiative of St James Ethics Centre. St James Ethics Centre
describes the index as “a strategic management tool to
enhance the capacity of businesses to develop, measure and
communicate best practice in the field of corporate social
responsibility. It does this through benchmarking corporate
social responsibility strategy and implementation process
across the four key impact areas of community, workplace,
marketplace and environment.” In participating in the
process, AWB demonstrated its leadership and commitment
to corporate social responsibility practices.
45

Board of Directors
AWB Limited
1
2
3
4
5
6
7
1. Brendan Stewart
Chairman, Non-executive director, 38, MAICD
Committees: Nomination (Chair), Remuneration
(Chair), Investment (Chair), Group Corporate Risk (exofficio
member) and Audit (ex-officio member)
Appointed on 3 February 2000 and re-elected on 13
March 2003. Mr Stewart was elected by the directors
as Chairman on 14 March 2002 and re-elected
Chairman on 13 March 2003. Mr Stewart is also
Chairman and a non-executive director of AWB
(International) Limited. Mr Stewart operates a 3,200
hectare property that produces grain, cotton and cattle
at Chinchilla, Queensland. He is a former President of
Queensland Graingrowers Association and Grains
Council of Australia and was Chair of the Joint
Ministerial Working Group on the Australian Wheat
Board Restructure and Vice President of National
Farmers’ Federation (NFF). Mr Stewart is a former
Chairman of the NFF Economics and Trade
Committee and former chairman of Wideland
Insurance Brokers Pty Limited. In January 2003, Mr
Stewart was appointed inaugural Chairman of the
Council for Australian Arab Relations.
2. Andrew Lindberg
Managing Director, 51, BComm, BSc, MBA,
FAICD
Committees: Group Corporate Risk and Investment
(Refer to page 38 for personal details)
3. Robert Barry
Deputy Chairman, Non-executive director, 57,
BCom, FCPA, FAICD
Committees: Audit (Chair), Nomination and Investment
Appointed on 12 January 1999, re-elected on 15
March 2001 and again on 11 March 2004. Mr Barry
is the current Deputy Chairman of AWB Limited and
Chairman of the Audit Committee. Mr Barry has
extensive financial experience in domestic and
international capital markets. He was Chief Executive
Officer of Dominguez Barry Samuel Montagu
Limited (a predecessor to UBS Australia) and Head of
International Capital Markets for the Midland Bank
Group in London. Mr Barry is Chairman of Snowy
Hydro Limited and a non-executive director of
Queensland Cotton Holdings Limited and Unisearch
Limited. Mr Barry has a farming interest at Willow
Tree, NSW.
4. Brendan Fitzgerald
Non-executive director, 60, Cert Rural Mgmt,
FCDA
Committees: Audit and Services Agreement
Elected on 13 March 2003. Mr Fitzgerald is a grain
grower from Kimba in SA. He has operated, in
partnership with his family, a farming and contract
harvesting business since 1975. In 1986, Mr
Fitzgerald was elected to the SACBH board and as a
director was involved in finance and audit,
nomination/remuneration and listing committees and
chaired the strategic infrastructure committee. After
demutualisation, he was Deputy Chairman of
AusBulk and United Grower Holdings. Mr Fitzgerald
has studied export grain marketing and storage in
North America, South Africa and England.
5. Steve Chamarette
Non-executive director, 60, BEcons, MSc, GAICD
Committees: Group Corporate Risk and Services
Agreement
Elected on 11 March 2004. Mr Chamarette is a grain
grower from Trayning, Western Australia and a WA
Farmers Grains Council delegate. He is also a
Graduate Member of the Australian Institute of
Company Directors.
6. Xavier Martin
Non-executive director, 45, FAICD
Committees: Nomination and Audit
Elected on 13 March 2003. Mr Martin is a wheat
grower and director of his family farming enterprise
near Gunnedah, NSW. During the past decade, Mr
Martin has been representing growers in leadership
positions across a range of organisations including
NSW Farmers Association, Grains Council of
Australia, Durum Wheat Growers Association and the
new Australian Durum Industry Association. Mr
Martin is a director of various private companies and
the public company, Plant Health Australia Limited.
7. Warrick McClelland
Non-executive director, 61, BAgSc
Committees: Audit and Services Agreement
Appointed on 4 November 1998 and re-elected on 14
March 2002. Mr McClelland is a grain and livestock
producer from Birchip in Victoria. He was a
Founding Committee Member of the Birchip
Cropping Group, Founding Chairman of Birchip
46

Promotion Committee and Founding Chairman of
Grains Industry Training Network (Victoria). Mr
McClelland is a former Victorian Farmers Federation
Grains Council President and Grains Council of
Australia Deputy President and a former director of
BRI Australia.
8. Christopher Moffet
Non-executive director, 61, FAICD
Committees: Group Corporate Risk and Investment
Appointed on 4 November 1998 and re-elected on 14
March 2002. Mr Moffet’s grain industry experience
includes ownership of a 16,000 hectare grain and
grazing property and involvement in the areas of
finance, marketing and business management. Mr
Moffet’s qualifications incorporate a former
directorship of Morawa Cooperative and over 30 years
of WA Farmers Federation membership, including
roles as President of branch, zone and Federation’s
Grains Council and executive member of Grains
Council of Australia. As a director of Grain Pool of
WA for eight years, Mr Moffet completed studies in
grain trading and futures management at the Chicago
Board of Trade. Mr Moffet is a Fellow of the
Australian Institute of Company Directors and has
recently been awarded the Advanced Diploma from
the Institute.
9. Peter Polson
Non-executive director, 58, BComm, MBL
Committees: Group Corporate Risk (Chair),
Remuneration and Investment
Appointed on 31 March 2003. Mr Polson has broad
experience in the financial services industry, first as
Managing Director of the international funds
management business with the Colonial group, then
as an executive with the Commonwealth Bank group
with responsibility for all investment and insurance
services for the group, including the CBA group's
funds management, master funds, superannuation and
insurance businesses and third party support services
for brokers, agents and financial advisers. In 2003, Mr
Polson commenced his career as a non-executive
director. Mr Polson is Chairman of Challenger
Financial Services Group Limited and a director of
Challenger Life Limited and Professional Indemnity
Insurance Company of Australia Pty Limited.
10. Kerry Sanderson
Non-executive director, 54, AO, BSc, BEcons,
MAICD, FCIT, FAIM
Committees: Group Corporate Risk and Services Agreement
Appointed on 1 May 1998, and re-elected on 14 March
2002. Mrs Sanderson is Chief Executive Officer of
Fremantle Ports Authority in Western Australia and Vice
President of the Association of Australian Ports and
Marine Authorities Inc. Mrs Sanderson has specific
skills in business management and trade promotion
with experience in transport and shipping. She is a
member of the Board of Trustees of the Fremantle
Hospital Medical Research Foundation, a director of
Rio Tinto WA Futures Foundation and a member of the
Australian Logistics Council. She is a Fellow of the
Chartered Institute of Transport and of the Australian
Institute of Management. Mrs Sanderson was a member
of the Board of the Australian Wheat Board from 1995.
11. John Simpson
Non-executive director, 45
Committees: Services Agreement (Chair) and
Remuneration
Appointed on 4 November 1998 and re-elected on 14
March 2002. Mr Simpson is a former director of
AWB (International) Limited. Mr Simpson is joint
Managing Director of Nowranie Pastoral Co Pty
Limited, a family owned company farming 10,000
hectares in the Riverina of NSW. He was a
representative for grain growers on the NSW Farmers’
Association Grains Committee for seven years, serving
two years as vice chairman.
12. John Thame
Non-executive director, 62, FCPA
Committees: Audit, Remuneration and Investment
Appointed on 9 April 1999 and re-appointed on 14
March 2002. Mr Thame joined the NSW Building
Society in 1971 and oversaw the conversion of the
Society to Advance Bank in 1985. He was Chief
Executive Officer of Advance Bank from 1985 until
its merger with St George Bank in January 1997. Mr
Thame is Chairman of St George Bank Limited, and
on the board of Reckon Limited, Village Building Co
Limited and Abacus Property Group Limited.
13. Richard Fuller
General Manager Executive and Company
Secretary, 45, BA (Hons), PhD (Political Science)
(Refer to page 39 for personal details)
8
9
10
11
12
13
47

Board of Directors
AWB (International) Limited
1
2
3
4
AWB (International) Limited (AWBI), is a wholly
owned subsidiary of AWB Limited, created to operate
the AWB National Pool as a requirement of the AWB
constitution and the Wheat Marketing Act 1989. The
constitution of AWBI was framed by the Australian
Government in consultation with the Grains Council
of Australia as part of the process of privatising the
Australian Wheat Board, effective in July 1999.
The board of AWBI under its constitution has
responsibility to maximise the net pool return for
growers who sell wheat into the AWB National Pool
by securing, developing and maintaining markets for
wheat and by minimising costs as far as practicable.
Directors of AWB Limited under their constitution
have the same obligation to growers. Thus, the two
constitutions and the governance obligations of the
two boards of directors are aligned.
AWBI has a separate board from AWB Limited. Since
AWBI should not on its own account make either a
profit or a loss, the primary function of the board is to
watch over the interests of growers in maximising net
returns from the AWB National Pool. While the
chairman and three other directors are required under
AWBI‘s constitution to be common to the boards of
both AWB Limited and AWBI, three directors –
Wayne Gibson, Clinton Starr and Ian Donges – are
grower elected directors for AWBI only. (Their
qualifications and experience are set out at the end of
this statement.)
The board of AWBI comprises:
three A class directors, elected by the A class
shareholders of AWB Limited in various regions as
follows:
– NSW/ACT – one A class director;
– WA – one A class director;
– QLD/VIC/SA/NT/TAS – one A class director;
the chairman of AWB Limited;
the managing director;
one A class director of AWB Limited other than the
chairman; and
one other director of AWB Limited.
The board met nine times during the financial year.
For details of the remuneration paid to each director of
AWBI, refer to the Remuneration Report incorporated in
the Directors’ Report (page 53).
The Wheat Export Authority, a Commonwealth
statutory authority, monitors AWBI’s performance in
accordance with the Wheat Marketing Act 1989.
Compliance Committee
The AWBI board has appointed a Compliance
Committee – the membership of which is restricted to
the three directors directly appointed to AWBI by
growers – to oversee the relationship between AWB
Limited and AWBI.
A charter issued by the board of AWBI establishes the
purpose, role and functions of the Committee.
The Compliance Committee has the responsibility of
ensuring that:
any dealing that AWBI has with its parent and
subsidiaries of AWB Limited are not in conflict
with the objectives of AWBI as operator of the
AWB National Pool;
the business rules and obligations as set down in the
Services Agreement with AWB Services Limited are
observed and maintained and are consistent with
the objectives of AWBI as operator of the AWB
National Pool; and
the requirements of the appropriate laws, regulations,
the constitution of AWB Limited, the constitution of
AWBI and appropriate industry codes, agreements
and regulations are observed.
Although both AWBI and AWB Limited have specific
constitutional requirements to maximise and
distribute net pool returns to growers, the Compliance
Committee is designed as an additional mechanism to
ensure that these obligations to growers are fulfilled.
In fulfilling its charter, the Compliance Committee
reports to the board of AWBI.
AWBI has charged the Compliance Committee with
responsibility of negotiating the Services Agreement
with AWB Limited.
The Committee met seven times during the financial
year. The members of the Compliance Committee are
Mr Clinton Starr (Chair), Mr Ian Donges and Mr
Wayne Gibson.
AWB (International) Limited 2004
Review Committee
The role of the AWB (International) Limited board
2004 Review Committee is to oversee the company’s
contribution to the review of AWBI’s performance in
operating the Single Desk. This review was conducted
in accordance with the Wheat Marketing Act 1989.
The Committee met four times during the financial
year. The members of the AWB (International)
Limited 2004 Review Committee are Mr Clinton
Starr (Chair), Mr Brendan Stewart and Mr Andrew
Lindberg.
48

1. Brendan Stewart
Chairman, Non-executive director
Committee: AWBI 2004 Review
(Refer to page 46 for personal details)
2. Andrew Lindberg
Director
Committee: AWBI 2004 Review
(Refer to page 46 for personal details)
3. Christopher Moffet
Non-executive director
(Refer to page 47 for personal details)
4. Peter Polson
Non-executive director
(Refer to page 47 for personal details)
5. Ian Donges
Non-executive director, 58, FAICD
Committee: Compliance
Appointed on 15 March 2001 and re-elected on 11
March 2004, Mr Donges is a grain grower from
central NSW. He has operated, in partnership with his
wife, a farming business since 1975. Mr Donges has
extensive representative involvement in farm
organisations including at a local level through NSW
Farmers and the NSW Agricultural Bureau. At a State
level Mr Donges has been involved with NSW
Farmers, serving that organisation in a number of
capacities including President for three years and
Chairman of the Grains Committee. Mr Donges
represented NSW on the Grains Council of Australia
and is immediate past president of the National
Farmers’ Federation. Mr Donges is Chairman of the
Grain and Graze Program, an initiative of three
research and development corporations. Mr Donges is
chairman of Horticulture Australia Limited, and a
member of the board of the CRC for salinity research.
6. Wayne Gibson
Non-executive director, 56, MCDA
Committee: Compliance
Appointed on 3 February 2000 and re-elected on 13
March 2003. Mr Gibson is a grain grower from
Kondinin, Western Australia and a former executive
committee member of the Kondinin Group and
former WA Farmers Federation Zone President and
Grains Council delegate. Mr Gibson is a Councillor
of the Kondinin Shire Council and a member of the
Corporate Directors’ Association of Australia.
7. Clinton Starr
Non-executive director, 57, BEc, MBA
Committees: Compliance (Chair) and AWBI 2004
Review (Chair)
Appointed on 4 November 1998 and re-elected on 14
March 2002. Mr Starr has had 20 years experience in
international funds management, including 10 years
experience in international funds marketing. This
extended to all main asset classes and he served as an
executive director from 1986 until 1998 both in
Australia and overseas. Since 1998, he has managed
the family partnership, which has interests in small
company management consulting and farming. He is
also a non-executive director of Multiemedia Limited
(Director/Deputy Chairman), Biological Farmers of
Australia (Co-op) Limited, Green Environmental Pty
Limited (Chairman), Mulch-Tech Pty Limited, Green
Planet Holdings Pty Limited (Chairman), Longboat
Holdings Pty Limited (Chairman), ACN 107 658
551 Pty Limited (Chairman) and Aussie Signs Pty
Limited (Deputy Chairman). Mr Starr is currently
completing a Doctorate in Business Administration at
RMIT, researching the optimal growth paths for
small/medium entrepreneurial businesses in Australia.
8. Richard Fuller
General Manager Executive and Company
Secretary, 45, BA (Hons), PhD (Political Science)
(Refer to page 39 for personal details)
5
6
7
8
49

Financial Statements
Page
Directors' Report
52
Statement of Financial Performance
60
Statement of Financial Position
61
Statement of Cash Flows
62
Notes to and Forming Part of the Financial Statements 63
– Index 63
Directors' Declaration
103
Independent Audit Report
104
50

DIRECTORS' REPORT
Your directors submit their report for the year ended 30 September 2004.
DIRECTORS
The directors of the company at any time during or since the end of the
financial year are:
Brendan Stewart (Chairman)
Robert Barry (Deputy Chairman)
Andrew Lindberg (Managing Director)
Steve Chamarette (elected at 2004 Annual General Meeting on 11
March 2004)
Brendan Fitzgerald
Laurie Marshall (resigned 11 March 2004)
Xavier Martin
Warrick McClelland
Christopher Moffet
Peter Polson
Kerry Sanderson
John Simpson
John Thame.
Except where noted, the directors held their position as director for the
financial year and up to the date of this report. A summary of the
experience, qualifications and special responsibilities of each director is
provided on pages 46 and 47.
PRINCIPAL ACTIVITIES
The AWB Group is Australia's leading rural services provider and one of
the world's largest wheat managers and marketers. Refer to Note 33(a)
to the financial statements for details of entities within the group.
AWB Group's operations can be categorised into five key business areas:
Pool Management Services – managing the aggregation and global
marketing of Australian wheat to maximise net pool returns,
providing commodity price and currency risk management, and
providing the development and Australian application of leading–edge
grain related technologies;
Rural Services (Landmark) – Landmark is Australia's largest supplier
of agribusiness products and services. It provides customers with rural
merchandise, fertiliser, livestock, wool marketing, agronomy,
insurance, real estate and rural financial services;
Finance and Risk Management – the provision of finance and risk
management products to grain growers;
Grain Acquisition and Trading – the trading, as principal, of grains
and shipping capacity, and the provision of marketing products to
Australian grain growers; and
Supply Chain and Other Investments – the development of, and
direct investment in, supply chain infrastructure and end–user grain
businesses.
RESULTS AND REVIEW OF OPERATIONS
2004 2003
$'000 $'000
Consolidated entity profit after tax and
outside equity interests for the financial year 96,862 43,891
A review of the operations and results of the consolidated entity and its
principal businesses during the financial year is contained in pages
10 to 29.
DIVIDENDS
Subsequent to year end, a fully franked final dividend of 11 cents per
share was approved by the board on 24 November 2004 and is payable
on 17 December 2004. All dividends paid will be fully franked at the
current tax rate of 30%. The 2003 final dividend of $36.0 million and
the 2004 interim dividend of $47.3 million were paid to B class
shareholders during the period.
SIGNIFICANT CHANGES IN THE STATE OF AFFAIRS
There were no significant changes in the state of affairs of the
consolidated entity during the financial year.
SIGNIFICANT EVENTS AFTER BALANCE DATE
Since 30 September 2004 no matter or circumstance has arisen that has
significantly affected, or may significantly affect:
(a) the consolidated entity's operations in future financial years; or
(b) the results of those operations in future financial years; or
(c) the consolidated entity's state of affairs in future financial years.
LIKELY DEVELOPMENTS AND EXPECTED RESULTS
The consolidated entity will continue to pursue its policy of increasing
the profitability and market share of its major business areas during the
next financial year. Further information about likely developments in
the operations of the consolidated entity and the expected results of
those operations in future financial years has not been included in this
report because disclosure of the information would be likely to result in
unreasonable prejudice to the consolidated entity.
ENVIRONMENTAL REGULATION AND
PERFORMANCE
The consolidated entity's operations are subject to various
Commonwealth, State and Territory environmental legislation and
regulation. There is no environmental regulation specific to the
consolidated entity. The board is not aware of any significant
environmental breaches during the financial year.
INDEMNIFICATION AND INSURANCE
The constitution of AWB Limited provides an indemnity for all current
and previous company directors, secretaries and executive officers. The
company indemnifies these people to the maximum extent permitted by
law for any liabilities or expenses incurred in defending any proceedings
where judgement is given in the person's favour. The indemnity does
not however, cover conduct involving a lack of good faith.
A Deed of Access, Indemnity and Insurance has been entered into
between the company and each director which provides that the
company will maintain a directors' and officers' insurance policy. The
Deed also provides an indemnity to the maximum extent permissible by
law to the director for any liabilities incurred as a director, other than
liabilities to the company or a related body corporate, or liabilities
arising out of conduct involving lack of good faith.
A directors' and officers' insurance policy is maintained; however, the
terms of the contract prohibit disclosure of the amount of the premium.
During or since the end of the financial year, no director, officer or
auditor had recourse to the indemnity or insurance.
REGISTERED OFFICE
Level 21, 380 La Trobe Street
Melbourne, Victoria, 3000
52

REMUNERATION REPORT
Remuneration Committee
The role of the Remuneration Committee is documented in a charter
which is approved by the board. Its principal functions are to review and
recommend to the board, where appropriate:
the remuneration policy, including the executive incentive policy,
employee share plans and superannuation;
recruitment, retention and termination policies and procedures for
senior management;
the performance appraisal policy; and
the managing director’s performance goals and remuneration.
It also reviews prior to implementation:
the remuneration and contract terms, including termination
provisions, of executives reporting to the managing director;
the design of new or amendments to current executive incentive plans
and the total proposed payments from each incentive plan;
the continuing appropriateness of the performance hurdles in each
executive incentive program;
the design of other executive benefit programs; and
succession planning.
The Remuneration Committee also provides advice to the board on the
remuneration of non–executive directors and the approval of awards
under the Employee Share Plan, Staff Ownership Plan, Equity Share
Plan and Performance Rights Plan.
The Remuneration Committee charter requires that four non–executive
directors should be members, including the chairman, and at least three
of whom must be independent.
The members of the Remuneration Committee are Mr Brendan Stewart
(Chairman), Mr Peter Polson, Mr John Simpson and Mr John Thame.
(Refer to pages 46 and 47 for details of the qualifications and experience
of committee members.)
The Remuneration Committee met five times during the financial year.
Refer to page 58 for details of the attendance by committee members at
those meetings.
A summary of the Remuneration Committee Charter is available on the
Corporate Governance section of AWB’s website.
Advisers
The Managing Director, the General Manager Corporate and the Head
of Human Resources attend committee meetings by invitation and have
assisted the Remuneration Committee in its deliberations during the
year, except where matters associated with their own remuneration were
considered.
In November 2002 the board appointed Mercer Human Resource
Consulting as an independent external advisor on matters pertaining to
the Managing Director’s remuneration. Advice was also sought during
the year from Godfrey Remuneration Consulting on both short and
long-term incentive plan design and measures as well as executive
remuneration advice.
Any information received by Human Resources, which is relevant to
matters being considered by the Remuneration Committee, is made
available to the committee’s members.
Remuneration policy
The Remuneration Committee recognises the complex nature of the
AWB Group’s business operations and that its performance depends on
the quality of its people. To be successful, the group must be able to
attract, motivate and retain highly skilled executives in a competitive
market.
The key principles of the group’s remuneration policy are designed to:
support AWB’s organisational and people objectives – that is, to
attract, motivate and retain employees;
provide market competitive fixed pay, and variable performance based
pay outcomes;
provide appropriate annual incentives for performance that reward
executives using financial and non-financial measures of performance;
provide a strong emphasis on long-term incentives so that the total
package can deliver superior reward for exceptional performance and
link rewards to executives to the creation of value for shareholders;
ensure remuneration arrangements between executives are equitable
and fair, supporting the appropriate deployment of resources and in
particular talent across the business; and
limit severance payments on termination to pre-established
contractual arrangements which do not commit the group to making
unjustified payments in the event of non-performance.
Remuneration for executives is divided into two components. The first
is the fixed component, referred to as “total cost”, which is made up of
base salary and benefits, including superannuation benefits. The second
component is the “at risk” component which includes the short-term
incentives that take the form of cash, and long-term incentives provided
via an equity plan. The amount of at risk remuneration, if any, that is
earned by an executive is wholly dependent upon the performance of the
individual, the team and the businesses against pre–determined Key
Performance Indicators (KPIs) and performance hurdles approved by the
board.
The cost and value of all of the components are considered as a whole.
AWB’s remuneration policy is to pay at the median level of
remuneration for target performance and to provide the opportunity for
upper decile rewards for distinctive (upper decile) performance.
Details of each element of remuneration are set out below:
Fixed remuneration
Total cost is quantified by reference to the scope and nature of the
individual’s role and their performance coupled with experience. Market
data is used to benchmark salary levels on a national basis, adjusted for
regional variance (within Australia) and against cost of living data for
local conditions in the instance of expatriates.
The executive may elect to have a combination of benefits, including
superannuation and the provision of a motor vehicle, provided out of
the fixed annual remuneration. The value of any of the non–cash
benefits provided to the executive includes the costs of any fringe
benefits tax payable by the company as a result of providing the benefit.
Benefits are not provided in addition to total cost, unless required as a
tool of trade (e.g. a motor vehicle). All benefits received by the specified
executives and non–executive directors are included in the following
table.
Superannuation benefits
A range of superannuation, retirement and death in service benefits
operate with AWB. These reflect the different statutory entitlements in
the jurisdictions in which the AWB Group operates and local market
practice.
53

DIRECTORS' REPORT (continued)
REMUNERATION REPORT (continued)
Remuneration policy (continued)
At risk remuneration
At risk remuneration is delivered as short and long-term incentives
under AWB’s remuneration policies.
The short-term incentive (STI) is cash based and applies to eligible
employees across the business, including the group’s executive
management team. The STI is calculated for each eligible employee by
assessing performance in relation to KPIs. KPIs are based on group,
individual business/revenue stream and personal measures with three
levels of performance against each KPI: threshold (the minimum
necessary to qualify for any reward); target (where the performance
requirements have been met); and stretch (where performance
requirements are exceeded). Eligible employees are those who have been
employed by the AWB Group for a minimum of six months during the
year ended 30 September 2004.
The maximum STI payment is between 10% and 100% of an
employee's total cost. Senior employees and those with revenue
generating accountability generally have the highest STI potential. The
AWB Group measure under the STI is based on profit before tax and
amortisation. Performance against this measure has a weighting in the
range of 30% to 50% of the overall STI for an AWB Group employee.
The Managing Director is also assessed against specific health, safety and
environmental targets as group measures.
Long term incentive (LTI) is provided for the Managing Director via a
cash based plan, the executive management team and selected senior
executives via the Performance Rights Plan, and for all other employees
via the Employee Share Plan and the Staff Ownership Plan. The plans
involve a long-term incentive generally in the form of shares and are
designed to foster long-term alignment of performance with shareholder
expectations and to provide reasonable reward for that performance.
Descriptions of the operation and conditions of these plans are included
below. AWB’s equity based remuneration plans have been approved by
shareholders and offers and payments made under the plans comply
with thresholds set in the plans.
Staff Ownership Plan
Under the Staff Ownership Plan, eligible employees are given the
opportunity to purchase B class shares in AWB with an interest free
loan. The number of shares that can be purchased through the plan
depends on pay level and the share price of B class shares at the time of
allocation. Employees can borrow up to a maximum of 10% of their
total employment cost to acquire B class shares. The maximum amount
in aggregate that can be outstanding at any time on loans under all
AWB employee share plans cannot exceed 50% of the employee's total
employment cost. The loans are interest free for a period of 10 years.
Any dividends paid on shares are used in full to pay off the loan.
Employee Share Plan
Under the Employee Share Plan, eligible employees are given the
opportunity to be issued with B class shares in AWB Limited. The
shares are issued for nil consideration. Each eligible employee who
participates receives shares to the value of $1,000 (based on the share
price of B class shares at issue date).
Performance review and succession planning
The Managing Director has established an annual process for the formal
review of individual performance and succession plans. Each specified
executive meets with the Managing Director to discuss performance
against the previous year’s key performance indicators, establish key
performance indicators for the following year and consider any
development action. Succession plans for key executive positions are also
discussed at the formal review.
Remuneration structure
It is AWB’s policy that service contracts for senior executives be
unlimited in term but capable of termination on not more than 12
months notice and that AWB retains the right to terminate the contract
immediately, by making a payment equal to not more than 12 months
pay in lieu of notice.
The Managing Director and Chief Financial Officer have fixed term
contracts which will expire on 30 September 2008 unless terminated
earlier or extensions of the contracts are negotiated. AWB retains the
right to terminate these contracts earlier with the provision of 12
months notice or payment in lieu of notice.
The Remuneration Committee has determined that it will limit notice
periods to 12 months in all future contracts for executives, unless
exceptional circumstances exist.
The service contracts typically outline the components of remuneration
paid to executives but do not prescribe how remuneration levels are to
be modified from year to year. Remuneration levels are reviewed
annually, to take account market relativities, individual performance and
the businesses’ capacity to pay, thereby ensuring alignment with the
principles of the remuneration policy are maintained.
Remuneration of non–executive directors
The AWB Limited constitution requires that the remuneration of
directors for their services as directors be by fixed sum and not a
commission on or a percentage of profits or operating revenue. At the
2004 Annual General Meeting, shareholders determined that the
maximum aggregate remuneration for all non–executive directors of
AWB Limited is $1,200,000 per annum.
All non–executive directors are paid a fixed fee in cash. The fixed fee
amounts are determined by the board, with the assistance of the
Remuneration Committee and external advisers.
The following principles are applied in determining the amount of
remuneration for non–executive directors:
the amount of time required for directors to consider AWB and board
matters including preparation time;
acknowledgement of the personal risk borne as a company director;
a comparison with professional market rates of remuneration and
those offered by comparative companies and external independent
advice as to appropriate levels to remain competitive with the market,
having regard to companies of similar size and complexity; and
the desire to attract directors of a high calibre, with appropriate levels
of expertise and experience.
The non–executive directors do not receive equity based remuneration
or performance based remuneration. Other than statutory
superannuation, there are no schemes for retirement benefits for
non–executive directors.
The non–executive directors are currently paid a fixed fee of $90,000
per annum (from 11 March 2004). The chairman receives 2.5 times this
amount. An additional amount of $25,000 per annum is paid to the
chair of the Audit Committee and an additional amount of $20,000 per
annum is paid to the Chair of the Group Corporate Risk Committee.
(These amounts include statutory superannuation.)
54

Remuneration of directors of AWB (International) Limited
AWB (International) Limited’s constitution provides that the directors
are entitled to be paid out of the funds of the company as remuneration
for their services as directors such sum as the company determines. The
constitution requires that the remuneration of directors for their services
as directors be by fixed sum and not a commission on or a percentage of
profits or operating revenue. As the sole member of AWB (International)
Limited, the company has approved the directors each being paid
$40,000 per annum. However, a person who is a director of both AWB
Limited and AWB (International) Limited does not receive any
additional remuneration in relation to their services as a director of
AWB (International) Limited – i.e. they only receive a fee for services as
a director of AWB Limited. An additional amount of $15,000 per
annum is paid to the Chair of the Compliance Committee. (These
amounts include statutory superannuation.)
DIRECTORS' AND OTHER OFFICERS'
EMOLUMENTS
Details of the nature and amount of each element of the emolument of
each director and each of the executive officers of AWB Limited and the
consolidated entity receiving the highest emolument for the financial
year are as follows:
Emoluments of directors of AWB Limited
Base fee
$
Superannuation Long-term incentive 3 Other
$ $ $
Non–executive
Brendan Stewart 186,507 16,786 – –
Robert Barry 96,639 7,693 – –
Steve Chamarette 1 40,065 10,016 – –
Brendan Fitzgerald 50,145 29,120 – –
Laurie Marshall 2 30,000 2,700 – –
Xavier Martin 72,720 6,545 – –
Warrick McClelland 31,706 47,559 – –
Christopher Moffet 72,720 6,545 – –
Peter Polson 91,854 8,267 – –
Kerry Sanderson 72,720 6,545 – –
John Simpson 72,720 6,545 – –
John Thame 72,720 6,545 – –
Executive
Andrew Lindberg 783,293 105,159 402,167 304,566 4
Total 1,673,809 260,025 402,167 304,566
1 Appointed 11 March 2004.
2 Resigned 11 March 2004.
3 A long-term incentive plan for the Managing Director was established in the 2002 financial year, whereby the Managing Director was given the
opportunity to receive cash incentives by participating in the plan. Under the plan, notional performance rights are issued to the Managing
Director. The terms and conditions of the plan are consistent with the Performance Rights Plan except that the benefit is delivered in cash. The
fair value of the notional performance rights is calculated at each reporting date using a Black–Scholes model and allocated to each reporting period
evenly over the period from grant date to vesting date. The value disclosed above is the portion of the fair value of all the notional performance
rights that have been granted.
On 30 May 2002, a total of 107,692 notional performance rights were issued. The performance period for these rights commenced on 1 October
2004 and ends on 1 October 2006.
On 1 October 2002, a further 125,641 notional performance rights were issued. The performance period for these rights commences on 1
October 2005 and ends on 1 October 2007.
On 1 October 2003, a further 142,450 notional performance rights were issued. The performance period for these rights commences on 1
October 2006 and ends on 1 October 2008.
4 “Other” emoluments include an amount paid on renewal of Mr Lindberg's contract and an amount paid as part of sign–on fee from his previous
contract. It also includes motor vehicles allowances subject to fringe benefits tax.
55

DIRECTORS' REPORT (continued)
DIRECTORS' AND OTHER OFFICERS' EMOLUMENTS (continued)
Emoluments of executives of AWB Limited
Short-term Amortised value Retention, termination
Base fee Superannuation incentive of performance and retirement
(2002/03 year) (a) rights issued (b) Other (c) benefits (d)
$ $ $ $ $ $
Richard Fuller 259,895 11,148 – 11,446 23,153 –
Peter Geary 418,828 35,138 – 20,603 30,273 –
Jill Gillingham 413,751 67,000 – 20,603 4,566 –
Paul Ingleby 616,520 11,148 – 34,325 26,984 –
Marcus Kennedy 412,520 11,148 – 11,910 68,816 –
John Maher 334,551 20,436 – – 18,913 125,000
Sarah Scales 435,415 11,437 – 17,503 7,168 –
Charles Stott 414,836 11,148 – 16,489 4,566 –
Michael Thomas 338,219 35,000 – 4,254 – –
Mark Allison 84,023 12,582 – – 26,946 875,326
Total 3,728,558 226,185 – 137,133 211,385 1,000,326
Notes:
The terms 'director' and 'officer' have been treated as mutually exclusive for the purposes of this disclosure.
(a) The short-term incentive (STI) component of remuneration in 2004 relates to performance incentives that would have been paid in the current
financial year. Cash and long-term incentive payments are granted annually, after the end of the year. The grant date is tied to the performance
appraisal, which, for the prior year, was completed after 30 September 2003. The specific service and performance criteria are set out earlier in this
report. During this reporting period, no incentives were paid to executives. The STI program was suspended in relation to the 2003 financial year
in recognition of the very tough operating conditions encountered during that period. An accrual has been made in the financial statements, based
on an estimate of the incentives to be paid in respect of the year ended 30 September 2004. The actual incentives to be paid have not been
determined at the date of this report, but are estimated to be in the order of $1.8 million. These incentives will be disclosed as remuneration in the
2005 financial report.
(b) The fair value of the performance rights is calculated at the date of grant using a Black–Scholes model and allocated to each reporting period
evenly over the period from grant date to vesting date. The value disclosed above is the portion of the fair value of all the performance rights that
have been granted.
The following factors and assumptions were used in determining the fair value of performance rights on grant date:
Fair value per Exercise Price of shares Estimated Risk free Dividend
Grant date Expiry date performance right price (i) on grant date volatility interest rate yield
1 October 2001 1 October 2005 $2.61 $1.00 $3.39 14% 5.5% 6.5%
1 October 2002 1 October 2006 $2.59 $1.00 $3.47 14% 5.3% 7.2%
1 October 2003 1 October 2007 $3.01 $1.00 $3.90 13% 5.3% 6.4%
(i) The total consideration payable on the exercise of any performance rights on a particular day will be one dollar in total (irrespective of the number
of rights exercised on that day).
Estimated volatility approximates historic volatility. The estimated life of all performance rights granted is four years. The value of performance
rights at grant date are therefore amortised over four years. Based on the formula inputs, the percentages used to determine the number of rights
from 2001, 2002 and 2003 to vest were 64%, 54% and 0% respectively. Each performance right entitles the holder to purchase one ordinary B class
share in the company.
Performance rights do not vest until three years after grant date and thereafter exercise is conditional on the consolidated entity achieving certain
performance hurdles. The performance rights are issued at no cost and become exercisable depending on the performance of the company (based on
total shareholder return) relative to the performance of the S&P/ASX200.
The expiry date disclosed is one year after vesting date, given that while the performance rights expire 10 years after the grant date, the expected
expiry of the performance rights is at this time.
Directors are not entitled to participate in performance rights plans.
Further details of performance rights granted are set out under “Performance rights granted to senior executives” below.
(c) “Other” emoluments in the case of executives, includes motor vehicles, housing benefits and other allowances subject to fringe benefits tax.
(d) A termination payment was made to the former Managing Director of Landmark, Mark Allison (resigned 27 November 2003). A retention
payment was made to Mr Maher following the acquisition of Landmark.
56

DIRECTORS' AND OTHER OFFICERS' EMOLUMENTS (continued)
Performance rights granted to senior executives
During or since the end of the financial year, AWB Limited granted performance rights for no consideration over unissued ordinary B class shares in
AWB Limited to the following executive officers of the company as part of their remuneration:
Executive officer Number of rights granted Exercise price (i) Expiry Date
Richard Fuller
Peter Geary
Jill Gillingham
Paul Ingleby
Marcus Kennedy
John Maher
Sarah Scales
Charles Stott
Michael Thomas
21,319
34,886
34,886
63,053
43,930
25,195
32,948
31,010
27,133
$1.00
$1.00
$1.00
$1.00
$1.00
$1.00
$1.00
$1.00
$1.00
1 October 2007
1 October 2007
1 October 2007
1 October 2007
1 October 2007
1 October 2007
1 October 2007
1 October 2007
1 October 2007
(i) The total consideration payable on the exercise of any performance rights on a particular day will be one dollar in total (irrespective of the number
of rights exercised on that day).
Unissued shares under option
At the date of this report, unissued ordinary shares of the company under option are:
Expiry Date Number of rights granted Exercise price (i)
1 October 2005 169,659 $1.00
1 October 2006 359,864 $1.00
1 October 2007 434,965 $1.00
The performance rights are issued at no cost and become exercisable depending on the performance of the company (based on total shareholder
return) relative to the performance of the S&P/ASX200.
These options do not entitle the holder to participate in any share issue of the company or any other body corporate.
Unissued shares under option by executive
The unissued ordinary shares of the company under option, by executive, are:
Held at
Held at
Right holdings 1 October 2003 30 September 2004
Executive officer
Richard Fuller
Peter Geary
Jill Gillingham
Paul Ingleby
Marcus Kennedy
John Maher
Sarah Scales
Charles Stott
Michael Thomas
33,747
60,486
60,486
101,124
38,043
–
51,649
48,717
13,587
55,066
95,372
95,372
164,177
81,973
25,195
84,597
79,727
40,720
Shares issued on exercise of performance rights
No performance rights have been exercised during or since the end of the financial year.
57

DIRECTORS' REPORT (continued)
DIRECTORS' MEETINGS
The number of meetings of directors (including meetings of committees of directors) held during the year and the number of meetings attended by
each director were as follows:
Board meetings Audit Committee meetings Group Corporate Remuneration
Risk Committee meetings Committee meetings
Eligible to Eligible to Eligible to Eligible to
Director attend Attended attend Attended attend Attended attend Attended
Brendan Stewart 14 14 8 8 6 6 5 5
Robert Barry 14 12 8 8
Andrew Lindberg 14 13 6 5
Steve Chamarette 1 7 7 3 3
Brendan Fitzgerald 14 14 4 4 3 3
Laurie Marshall 2 7 7 4 4
Xavier Martin 14 14 8 8
Warrick McClelland 14 14 8 8
Christopher Moffet 14 13 6 6
Peter Polson 14 12 6 6 5 5
Kerry Sanderson 14 13 6 5
John Simpson 14 14 5 5
John Thame 14 14 8 7 5 4
Nomination Investment Services Agreement
Committee meetings Committee meetings Committee meetings
Eligible to Eligible to Eligible to
Director attend Attended attend Attended attend Attended
Brendan Stewart 6 6 4 4
Robert Barry 6 5 4 3
Andrew Lindberg 4 4
Steve Chamarette 1 1 1
Brendan Fitzgerald 1 1
Laurie Marshall 2 1 1
Xavier Martin 3 3
Warrick McClelland 3 3 2 2
Christopher Moffet 1 1
Peter Polson 4 4
Kerry Sanderson 2 2 1 0
John Simpson 3 3 1 1
John Thame 4 3 1 1
In all cases where a director did not attend a meeting, leave of absence was granted to the director.
In some cases, directors attended meetings by proxy in accordance with the constitution.
1 Elected at the 2004 Annual General Meeting.
2 Not re–elected at the 2004 Annual General Meeting.
58

DIRECTORS' INTERESTS
The relevant interest of each director in the shares issued by AWB Limited, as notified by the directors to the ASX in accordance with s205G(1) of
the Corporations Act 2001, at the date of this report is as follows:
A class shares
held in AWB Limited
(number)
Brendan Stewart 1
Robert Barry 1
Andrew Lindberg –
Brendan Fitzgerald 1
Xavier Martin 1
Warrick McClelland 1
Christopher Moffet 1
Peter Polson –
Kerry Sanderson –
John Simpson 1
John Thame –
Steve Chamarette 1
B class shares
held in AWB Limited
(number)
16,776
40,579
72,925
12,000
72,046
68,035
100,577
5,000
5,000
119,672
5,000
500
ROUNDING
The amounts contained in this report and in the financial statements have been rounded off under the option available to the company under
Australian Securities and Investments Commission Class Order 98/100. Amounts in this report have been rounded off in accordance with that Class
Order to the nearest thousand dollars, or in certain cases, to the nearest dollar.
Signed in accordance with a resolution of the directors:
Brendan Stewart
Chairman
Sydney
24 November 2004
Andrew Lindberg
Managing Director
59

STATEMENT OF FINANCIAL PERFORMANCE
FOR THE YEAR ENDED 30 SEPTEMBER 2004
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Revenue from ordinary activities 2 5,344,645 2,211,890 210,017 212,399
Cost of sales (4,612,139) (1,889,225) (5,085) (6,029)
Borrowing costs 3 (113,891) (70,505) (2,762) (1,250)
Other expenses from ordinary activities (480,632) (195,350) (156,131) (139,589)
Share of net profits of associates accounted for using the
equity method 9(b) 9,070 2,097 – –
Profit from ordinary activities before income tax expense 147,053 58,907 46,039 65,531
Income tax expense relating to ordinary activities 4(a) (49,402) (14,757) (5,084) (4,234)
Net profit from ordinary activities after income tax expense 23 97,651 44,150 40,955 61,297
Net profit attributable to outside equity interests 20 (789) (259) – –
Net profit attributable to members of AWB Limited 19(b) 96,862 43,891 40,955 61,297
Net exchange differences relating to self sustaining
foreign operations 19(a) (3,241) (12,975) – –
Total changes in equity other than those resulting from
transactions with owners as owners attributable to members
of AWB Limited 21 93,621 30,916 40,955 61,297
Basic earnings per share (cents) 34 28.8 15.9
Diluted earnings per share (cents) 34 28.8 15.9
60

STATEMENT OF FINANCIAL POSITION
AS AT 30 SEPTEMBER 2004
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Current assets
Cash assets 5 48,225 54,785 87,890 2,328
Receivables 6 1,714,611 1,006,482 787,096 842,188
Inventories 7 180,961 185,377 – –
Other financial assets 11 728,889 137,893 – –
Current tax assets 4(b) – 13,444 – –
Other assets 8 9,189 12,200 53 185
Total current assets 2,681,875 1,410,181 875,039 844,701
Non–current assets
Receivables 6 11,185 6,167 174,877 54,711
Investments accounted for using the equity method 9(a) 21,361 12,910 – –
Other financial assets 11 144,571 138,066 36,177 38,763
Intangible assets 12 515,029 533,574 170 172
Property, plant and equipment 13 319,561 350,443 – 54,917
Deferred tax assets 4(b) 41,617 43,044 41,617 6,585
Total non–current assets 1,053,324 1,084,204 252,841 155,148
Total assets 3,735,199 2,494,385 1,127,880 999,849
Current liabilities
Payables 14 533,927 356,615 90,824 46,880
Interest bearing liabilities 15 1,580,975 668,007 – 9,752
Current tax liabilities 4(b) 37,198 – 37,198 3,122
Provisions 16 49,030 50,649 4,611 14,650
Other liabilities 17 145,444 79,942 – 1,001
Total current liabilities 2,346,574 1,155,213 132,633 75,405
Non–current liabilities
Interest bearing liabilities 15 321,131 394,877 – –
Provisions 16 4,744 1,721 36 1,721
Deferred tax liabilities 4(b) 16,505 10,554 16,505 6,125
Total non–current liabilities 342,380 407,152 16,541 7,846
Total liabilities 2,688,954 1,562,365 149,174 83,251
Net assets 1,046,245 932,020 978,706 916,598
Equity
Contributed equity 18(a) 953,403 848,958 953,403 848,958
Reserves 19(a) (1,524) 1,717 15,000 15,000
Retained profits 19(b) 91,907 78,337 10,303 52,640
Total parent entity interest 1,043,786 929,012 978,706 916,598
Outside equity interests 20 2,459 3,008 – –
Total equity 21 1,046,245 932,020 978,706 916,598
61

STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Cash flows from operating activities
Receipts from customers 5,391,527 2,494,079 1,832 141,886
Payments to suppliers and employees (5,549,673) (1,975,985) (72,217) (149,147)
Repayments of grower loans 1,169,190 1,650,882 – –
Loans advanced to growers (1,331,171) (587,437) – –
Interest received 81,022 82,997 85,661 33,336
Borrowing costs paid (113,891) (70,505) (2,762) (1,250)
Dividends received 9,308 4,604 57,541 42,162
Income tax refunds received 32,987 7,620 – 7,620
Income taxes paid (24,331) (61,961) (1,748) –
Net cash flows from/(used in) operating activities 23(a) (335,032) 1,544,294 68,307 74,607
Cash flows from investing activities
Payments for property, plant and equipment (35,555) (93,167) (54) (17,612)
Proceeds from sale of property, plant and equipment 15,828 572 59,949 22
Payment for controlled entities (net of cash acquired) 33(b) (22,093) (542,765) – –
Purchases of investments and associates (10,205) (122,642) (220) (2,402)
Proceeds from/(placement of ) short-term deposits and securities (net) (479,824) (25,287) – –
Net cash flows from/(used in) investing activities (531,849) (783,289) 59,675 (19,992)
Cash flows from financing activities
Proceeds from issues of ordinary shares 76,026 153,967 76,025 152,484
Payment of share issue and listing costs (321) (5,321) (321) (5,321)
Proceeds from/(repayment of ) borrowings from related party
(AWB National Pools) 793,096 (234,944) (9,752) 3,791
Proceeds from/(repayment of ) borrowings from wholly owned group – – (53,820) (158,793)
Proceeds from/(repayment of ) interest bearing deposits 19,068 3,711 – –
Proceeds from/(repayment of ) borrowings 27,058 (625,015) – –
Dividends paid (54,606) (68,539) (54,552) (68,444)
Net cash flows from/(used in) financing activities 860,321 (776,141) (42,420) (76,283)
Net increase/(decrease) in cash held (6,560) (15,136) 85,562 (21,668)
Cash at the beginning of the financial year 54,785 69,921 2,328 23,996
Cash at the end of the financial year 23(b) 48,225 54,785 87,890 2,328
62

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
INDEX
Page
1 Summary of significant accounting policies 63
2 Revenue from ordinary activities 67
3 Profit from ordinary activities before income tax expense 68
4 Taxation 69
5 Cash assets 70
6 Receivables 70
7 Inventories 70
8 Other assets 70
9 Investments accounted for using the equity method 71
10 Interests in joint venture operations 72
11 Other financial assets 72
12 Intangible assets 72
13 Property, plant and equipment 73
14 Payables 74
15 Interest bearing liabilities 74
16 Provisions 75
17 Other liabilities 76
18 Contributed equity 76
19 Reserves and retained profits 77
20 Outside equity interests 77
21 Total equity reconciliation 77
22 Dividends 78
23 Notes to statement of cash flows 78
24 Directors and executive disclosures 79
25 Auditor’s remuneration 84
26 Related party disclosures 85
27 Segment information 86
28 Expenditure commitments 88
29 Contingent liabilities 89
30 Employee entitlements and superannuation commitments 89
31 Financial instruments 90
32 Deed of Cross Guarantee 97
33 Controlled entities 98
34 Earnings per share 100
35 Subsequent events 101
36 Disclosing the impact of adopting AASB equivalents 101
to International Financial Reporting Standards (A-IFRS)
1. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
(a) Basis of preparation
The financial report is a general purpose financial report which has been
prepared in accordance with Accounting Standards, Urgent Issues Group
Consensus Views, other authoritative pronouncements of the Australian
Accounting Standards Board and the Corporations Act 2001.
It has been prepared on the basis of historical costs and except where
stated, does not take into account fair values of non–current assets.
(b) Changes in accounting policies
Accounting policies have been consistently applied by each entity in the
consolidated entity and are consistent with those of the previous year.
Comparative information has been repositioned or reclassified where
appropriate to ensure comparability with the current reporting period.
(c) Principles of consolidation
Controlled entities
The financial statements of controlled entities are included from the
date control commences until the date control ceases.
Outside interests in the equity and results of the entities that are
controlled by the company are shown as a separate item in the
consolidated financial statements.
Associates
Associates are those entities, other than partnerships, over which the
consolidated entity exercises significant influence and which are not
intended for sale in the near future.
In the consolidated financial statements, investments in associates are
accounted for using equity accounting principles. Investments in
associates are carried at the lower of the equity accounted amount and
recoverable amount. The consolidated entity’s equity accounted share of
the associates’ net profit or loss is recognised in the consolidated
statement of financial performance from the date significant influence
commences until the date significant influence ceases. Other movements
in reserves are recognised directly in consolidated reserves.
Joint venture operations
Joint venture operations are jointly controlled by the consolidated entity.
The consolidated entity’s interests in unincorporated joint ventures are
brought to account by including its proportionate share of the joint
ventures’ assets, liabilities and expenses and the consolidated entity’s
revenue from the sale of its share of output on a line by line basis, from
the date joint control commences to the date joint control ceases.
Transactions eliminated on consolidation
Unrealised gains and losses and inter–entity balances resulting from
transactions with or between controlled entities are eliminated in full on
consolidation.
Unrealised gains resulting from transactions with associates and joint
ventures, including those relating to contributions of non–monetary
assets on establishment, are eliminated to the extent of the consolidated
entity’s interest. Unrealised gains relating to associates and joint ventures
are eliminated against the carrying amount of the investment. Unrealised
losses are eliminated in the same way as unrealised gains, unless they
evidence a recoverable amount impairment.
AWB National Pools
As in previous years, the activities of the AWB National Pools have not
been recognised in the financial statements of the consolidated entity.
The economic benefit from the activities of the AWB National Pools are
derived by pool participants rather than the consolidated entity.
(d) Revenue recognition
Revenues are recognised at fair value of the consideration received net of
the amount of goods and services tax payable to the Australian Taxation
Office.
Sales
Revenue from sales made on commercial terms is recognised when title
for the commodity transfers to the customer. In the case of export sales,
the bill of lading (shipment) date is taken as the transaction date unless
title is to pass at a materially different time.
Management fee revenue
Management fee revenue is recognised according to when the costs of
providing the services are incurred.
Interest revenue
Interest revenue is recognised as it accrues taking into account the
effective yield of the financial asset.
63

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
1. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (continued)
(d) Revenue recognition (continued)
Underwriting fee
The underwriting fee charged on loan products is a fee for the service of
providing a non–recourse loan. Underwriting fee revenue is recognised
on a basis consistent with the pattern of the incidence of risk covered by
the service provided.
Sale of non–current assets
The gross proceeds of non–current asset sales are included as revenue at
the date control of the asset passes to the buyer, usually when an
unconditional contract of sale is signed. The gain or loss on disposal is
calculated as the difference between the carrying amount of the asset at
the time of disposal and the net proceeds on disposal.
(e) Goods and services tax
Revenues, expenses and assets are recognised net of the amount of goods
and services tax (GST), except where the amount of GST incurred is not
recoverable from the Australian Taxation Office (ATO). In these
circumstances, the GST is recognised as part of the cost of acquisition of
the asset or as part of the expense.
Receivables and payables are stated with the amount of GST included.
The net amount of GST recoverable from, or payable to, the ATO is
included as a current asset or liability in the statement of financial
position.
Cash flows are included in the statement of cash flows on a gross basis.
The GST components of cash flows arising from investing and financing
activities which are recoverable from, or payable to, the ATO are
classified as operating cash flows.
(f) Income tax
Income tax expense is calculated at current rates on the accounting
profit adjusted for permanent differences. Future income tax benefits
and liabilities arise because some items are included in accounting profit
in a period different from that in which the items are assessed for
income tax and are included in the statement of financial position as a
non–current asset and non–current liability respectively.
As provided for in Australian Accounting Standard AASB 1020: Income
Taxes, these deferred tax balances have been offset where applicable.
Future income tax benefits are not brought to account unless realisation
of the asset is assured beyond reasonable doubt.
Tax consolidation
The company is the head entity in the tax–consolidated group
comprising all the Australian wholly–owned subsidiaries set out in Note
33. The implementation date for the tax–consolidated group is 1
October 2003. The head entity recognises all of the current and deferred
tax assets and liabilities of the tax–consolidated group (after elimination
of intragroup transactions).
The tax–consolidated group has entered into a tax funding agreement
that requires wholly owned subsidiaries to make contributions to the
head entity for:
– deferred tax balances recognised by the head entity on implementation
date, including the impact of any relevant reset tax cost bases; and
– current tax assets and liabilities and deferred tax balances arising from
external transactions occurring after the implementation of tax
consolidation.
Under the tax funding agreement, the contributions are calculated on a
“stand–alone basis” so that the contributions are equivalent to the tax
balances generated by external transactions entered into by
wholly–owned subsidiaries. The contributions are payable as set out in
the agreement and reflect the timing of the head entity’s obligations to
make payments for tax liabilities to the relevant tax authorities. The
assets and liabilities arising under the tax funding agreement are
recognised as intercompany assets and liabilities with a consequential
adjustment to income tax expense/revenue.
(g) Foreign currencies
Transactions
Transactions in foreign currencies are converted to Australian currency at
the rate of exchange ruling at the date of the transaction. Amounts
receivable and payable in foreign currencies at reporting date are
translated at the rates of exchange ruling on that date.
Exchange differences relating to amounts receivable and payable in
foreign currencies are brought to account as exchange gains or losses in
the statement of financial performance in the financial year the
exchange rates change, except where hedging specific anticipated
transactions. (See Note 1(h) Derivatives)
Translation of controlled foreign operations
The assets and liabilities of foreign operations, including controlled
entities and associates, that are self sustaining are translated at the rates
of exchange ruling at balance date. Equity items are translated at
historical rates. The statements of financial performance are translated at
either a weighted average rate for the year or transaction date. Exchange
differences arising on translation are taken directly to the foreign
currency translation reserve until the disposal, or partial disposal, of the
operations.
The assets and liabilities of foreign operations, including controlled
entities and associates, that are integrated are translated using the
temporal method. Monetary assets and liabilities are translated into
Australian currency at rates of exchange current at balance date, while
non–monetary items and revenue and expense items are translated at
exchange rates current when the transactions occurred. Exchange
differences arising on translation are brought to account in the statement
of financial performance.
(h) Derivatives
The consolidated entity is exposed to changes in interest rates, foreign
exchange rates and commodity and freight prices from its activities. The
consolidated entity uses the following derivative financial instruments to
hedge these risks: interest rate swaps, interest rate futures, interest rate
swaptions, forward rate agreements, interest rate options, forward
foreign exchange contracts, foreign exchange options, forward
commodity price contracts, commodity futures, commodity options and
forward freight agreements.
Hedges
Where hedge transactions are designated as a hedge of an anticipated
specific purchase or sale of goods or an anticipated interest transaction,
gains and losses on the hedge arising up to the date of the anticipated
transaction, together with any costs or gains arising at the time of
entering into the hedge, are deferred and included in the measurement
64

(h) Derivatives (continued)
of the anticipated transaction when the transaction occurs as designated.
Any gains or losses on the hedge transaction after that date are included
in the statement of financial performance.
The net amounts receivable or payable under forward foreign exchange
contracts, open swaps, forward rate agreements and futures contracts
and the associated deferred gains or losses are recorded on the statement
of financial position from the date of inception of the hedge transaction.
The net receivables or payables are revalued using the foreign currency,
interest or commodity rates current at reporting date.
When the anticipated transaction is no longer expected to occur as
designated, the deferred gains and losses relating to the hedged
transaction are recognised immediately in the statement of financial
performance.
Where a hedge transaction is terminated early and the anticipated
transaction is still expected to occur as designated, the deferred gains and
losses that arose on the hedge prior to its termination continue to be
deferred and are included in the measurement of the purchase or sale or
interest transaction when it occurs. Where a hedge transaction is
terminated early because the anticipated transaction is no longer
expected to occur as designated, deferred gains and losses that arose on
the hedge prior to its termination are included in the statement of
financial performance for the period.
Where a hedge is redesignated as a hedge of another transaction, gains
and losses arising on the hedge prior to its redesignation are only
deferred where the original anticipated transaction is still expected to
occur as designated. When the original anticipated transaction is no
longer expected to occur as designated, any gains or losses relating to the
hedge instrument are included in the statement of financial performance
for the period.
Other derivatives
All other derivative transactions are initially recorded at the relevant rate
at the date of the transaction. Derivatives outstanding at balance date are
valued at the rates ruling on that date and any gains or losses are
brought to account in the statement of financial performance. The
exception is those interest rate derivatives detailed in Note 31(f ).
(i) Cash
For the purpose of the statement of cash flows, cash includes cash on
hand and in banks, net of outstanding bank overdrafts. Bank overdrafts
are carried at the principal amount. Interest is charged as an expense as
it accrues.
(j) Receivables
The collectability of debts is assessed at balance date and specific
provision is made for any doubtful accounts.
Trade debtors
Terms of trade receivables generally require settlement within 30 days.
Receivables from related parties have been discounted to their present
value using a market determined discount rate.
(k) Inventories
Inventories are valued at the lower of cost or net realisable value.
Associates
Investments in unlisted shares of associates are carried in the company's
financial statements at the lower of cost or recoverable amount.
Joint venture operations
Investments in joint venture operations are accounted for in the
financial statements as set out in Note 1(c) Principles of consolidation.
Other entities
Investments in other entities are carried at the lower of cost or
recoverable amount.
(m) Lease assets
Finance leases
Finance leases are capitalised. A lease asset and a lease liability equal to
the present value of the minimum lease payments are recorded at the
inception of the lease.
Lease liabilities are reduced by repayments of principal. The interest
components of the lease payments are expensed.
Operating leases
Payments made under operating leases are expensed on a straight line
basis over the term of the lease.
(n) Constructed non–current assets
The cost of non–current assets constructed by the consolidated entity
includes the cost of all materials used in construction, direct labour on
the project and an appropriate proportion of overheads.
(o) Research and development expenditure
Research and development expenditure is expensed as incurred except to
the extent that its recoverability is assured beyond any reasonable doubt,
in which case it is deferred.
(p) Intangible assets
Goodwill
On acquisition of some, or all, of the assets of another entity, the
identifiable net assets acquired are measured at fair value. The excess of
the fair value of the cost of acquisition over the fair value of the
identifiable net assets acquired is brought to account as goodwill and
will be amortised so that it is recognised as an expense in the statement
of financial performance on a straight line basis over a period of 20 years
or the expected useful life.
Licence fees
Costs associated with licence fees are deferred and amortised on a
straight line basis over the period of their expected benefit.
(q) Recoverable amount of non–current assets
Non–current assets are not carried at an amount above their recoverable
amount, and where carrying values exceed their recoverable amount,
assets are written down to their recoverable amounts.
(l) Investments
Controlled entities
Investments in controlled entities are carried in the company’s financial
statements at the lower of cost or recoverable amount.
65

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
1. SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES (continued)
(r) Depreciation of property, plant and equipment
Depreciation is provided on a straight line basis for all property, plant
and equipment, other than freehold land, from the date at which the
asset becomes available for use. Depreciation charges are calculated to
allocate cost or valuation, less estimated residual value at the end of the
useful lives of the assets against revenue over those estimated useful lives.
The depreciation rates used for each class of depreciable assets are:
– buildings 2%
– plant and equipment 5% to 33%.
(s) Employee benefits
Provision is made for long service leave and annual leave estimated to be
payable to employees on the basis of their terms of employment and
statutory requirements. The provision calculations include all employee
related on–costs and are based on total remuneration packages. This
method of calculating provisions provides a result that is materially
correct in accordance with AASB 1028: Employee Benefits.
In respect of the consolidated entity's accumulation fund, any
contributions made to the superannuation funds by entities within the
consolidated entity are charged against profits when due.
(t) Interest bearing liabilities
All loans are measured at the principal amount. Interest is charged as an
expense as it accrues.
(u) Share capital
Ordinary share capital is recognised at the fair value of the consideration
received by AWB Limited. Any transaction costs arising on the issue of
ordinary shares are recognised directly in equity as a reduction of the
share proceeds received.
(v) Earnings per share
Basic earnings per share is calculated as net profit attributable to
members, adjusted to exclude costs of servicing equity (other than
dividends) and preference share dividends, divided by the weighted
average number of ordinary shares, adjusted for any bonus element.
Diluted earnings per share is calculated as the net profit attributable to
members, adjusted for:
costs of servicing equity (other than dividends) and preference share
dividends;
the after tax effect of dividends and interest associated with dilutive
potential ordinary shares that have been recognised as expenses; and
other non–discretionary changes in revenues and expenses during the
period that would result from the dilution of potential ordinary shares
divided by the weighted average number of ordinary shares and
dilutive potential ordinary shares, adjusted for any bonus element.
66

2. REVENUE FROM ORDINARY ACTIVITIES
Consolidated
AWB Limited
2004 2003 2004 2003
$'000 $'000 $'000 $'000
Revenue from sale of goods
– other corporations 3,127,306 1,628,916 162 –
– related party (AWB National Pools) 1,983,929 409,720 – 8,991
5,111,235 2,038,636 162 8,991
Management fee revenue
– related party (AWB National Pools) 95,198 77,091 – 77,091
– wholly owned group – – 2,456 50,877
95,198 77,091 2,456 127,968
Dividends
– other corporations 7,535 4,448 167 354
– other related parties – – 42 208
– wholly owned group – – 57,332 41,600
7,535 4,448 57,541 42,162
Interest
– other persons/corporations 72,677 80,571 746 1,143
– related party (AWB National Pools) 8,345 2,426 – –
– wholly owned group – – 84,915 32,193
81,022 82,997 85,661 33,336
Rental income 4,477 406 – –
Proceeds on sale of non–current assets 15,828 572 59,949 22
Underwriting fees 16,693 4,176 – –
Other revenue 12,657 3,564 4,248 (80)
Total revenue from ordinary activities 5,344,645 2,211,890 210,017 212,399
Details of related party transactions are included in Note 26(b).
67

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
3. PROFIT FROM ORDINARY ACTIVITIES BEFORE INCOME TAX EXPENSE
Profit from ordinary activities before income tax expense includes
the following specific expenses:
Consolidated
AWB Limited
2004 2003 2004 2003
$'000 $'000 $'000 $'000
Amortisation of non–current assets
– goodwill 27,077 2,441 – –
– licence fees 23 26 23 26
27,100 2,467 23 26
Depreciation of non–current assets
– plant and equipment 52,956 25,502 155 13,972
– buildings 3,230 1,913 52 307
56,186 27,415 207 14,279
Total depreciation and amortisation expenses 83,286 29,882 230 14,305
Write down in value of property plant and equipment to
recoverable amount – 7,182 – 7,182
Write down in value of investment in associate to recoverable amount 2,806 – 2,806 –
Borrowing costs expensed
Interest expense
– wholly owned group – – 1,992 901
– related party (AWB National Pools) 19,143 10,353 770 –
– other persons/corporations 89,784 57,381 – –
Other borrowing costs
– other persons/corporations 4,964 2,771 – 349
Total borrowing costs 113,891 70,505 2,762 1,250
Research and development costs 4,634 6,960 – 6,960
Net (gain)/loss on disposal of property, plant and equipment (5,545) (21) (5,185) 23
Operating lease rental expense 23,171 4,777 52 1,853
Employee benefit expenses 222,256 72,350 3,298 54,644
Net expense for movements in provision:
– employee benefits 3,957 (330) (8,292) 568
– restructure costs (8,292) 5,000 (3,389) 5,000
– counterparty default relating to other financial assets 6,634 8,368 – –
– onerous contracts 7,401 1,548 – –
Net bad and doubtful debts expensed including movements in
provision for doubtful debts 8,767 2,769 (1) (2,117)
68

4. TAXATION
Consolidated
AWB Limited
2004 2003 2004 2003
$'000 $'000 $'000 $'000
(a) Income tax expense
The income tax expense for the year differs from the amount calculated
on the profit. The differences are reconciled as follows:
Prima facie income tax expense calculated at 30% on the profit
from ordinary activities 44,116 17,672 13,812 19,659
Tax effect of permanent differences:
Share of net profits from associates (2,543) (628) – –
Franking credits on dividends received (1,657) (828) – (12,484)
Research and development concessions (710) (656) 1,156 (656)
Amortisation of intangible assets 8,130 732 – –
Depreciation of buildings 463 351 – –
Foreign tax credits (2,261) (1,423) (2,261) (1,100)
Under/(over) provision of previous year (671) (2,535) (933) (2,063)
Tax rate differential on foreign entities 973 502 3,088 –
Attibutable income of foreign entities 4,552 3,338 4,552 3,338
Tax consolidation intragroup transactions – – (14,933) –
Other items (net) (990) (1,768) 603 (2,460)
Income tax expense attributable to profit from ordinary activities 49,402 14,757 5,084 4,234
(b) Deferred tax assets and liabilities
Current tax assets – 13,444 – –
Future income tax benefit
– Parent entity – – 5,264 6,585
– Entities in the tax consolidated group (i) 41,617 43,044 36,353 –
41,617 43,044 41,617 6,585
Current tax payable
– Parent entity – – 10,966 3,122
– Entities in the tax consolidated group (i) 37,198 – 26,232 –
37,198 – 37,198 3,122
Provision for deferred income tax – non–current
– Parent entity – – 296 6,125
– Entities in the tax consolidated group (i) 16,505 10,554 16,209 –
16,505 10,554 16,505 6,125
(i) Entities in the tax consolidated group have entered into a tax sharing agreement. Refer Note 1(f ) for further information.
This future income tax benefit will only be obtained if:
– future assessable income is derived of a nature and of an amount sufficient to enable the benefit to be realised;
– the conditions for deductibility imposed by tax legislation continue to be complied with; and
– no changes in tax legislation adversely affect the consolidated entity in realising the benefit.
69

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
5. CASH ASSETS
Consolidated
AWB Limited
Notes 2004 2003 2004 2003
$'000 $'000 $'000 $'000
Cash at bank and on hand 48,225 54,785 87,890 2,328
Details of significant terms and conditions are included in Note 31(a).
6. RECEIVABLES
Current
Trade debtors
– other persons/corporations 456,228 443,872 29 86
– less provision for doubtful debts (33,060) (24,293) – (1)
423,168 419,579 29 85
– related party (AWB National Pools) 26(b) 691,184 162,100 7 –
1,114,352 581,679 36 85
Grower loan receivables 575,217 413,236 – –
Finance advances 10,966 5,200 – –
Goods and services tax receivable – 904 – 2,718
Other receivables
– other persons/corporations 14,076 5,463 – –
– wholly owned group 26(b) – – 787,060 839,385
1,714,611 1,006,482 787,096 842,188
Non–current
Other loans 2,478 3,672 1,131 2,216
Employee share loan 8,707 2,495 8,746 2,495
Subordinated loan
– wholly owned group 26(b) – – 165,000 50,000
11,185 6,167 174,877 54,711
Details of significant terms and conditions are included in Note 31(a).
7. INVENTORIES
Finished goods 184,363 191,128 – –
Provision for diminution in value (3,402) (5,751) – –
180,961 185,377 – –
8. OTHER ASSETS
Prepayments 4,718 6,486 – –
Other assets 4,471 5,714 53 185
9,189 12,200 53 185
70

9. INVESTMENTS ACCOUNTED FOR USING THE EQUITY METHOD
(a) Details of investments in associates held by the consolidated entity
Consolidated
Principal Balance 2004 2003
Name % activity date $'000 $'000
Arcadian Wool Brokers Limited
Wooldumpers Australia Pty Ltd
Sydney Wool Brokers Limited
ACN 093 163 430 Pty Ltd
Five Star Flour Mills Company SAE (FSFM)
Five Star Feed Mills & Animal Production Company SAE
Kelly & Co Rural Centre Pty Limited
40 Wool handling 30 June 1,725 1,714
50 Wool handling 30 June 5,823 889
46.7 Wool handling 30 June – –
25 Rural financing 30 June – –
30 Flour mill 30 June 10,154 8,360
(i) Feed mill 30 June 2,681 1,947
50 Rural merchandise 30 June 978 –
21,361 12,910
Five Star Flour Mills and Five Star Feed Mills are based in Egypt.
(i) AWB Group holds 23.7% directly. The other 9% is indirectly held through FSFM.
(b) Share of associates' profit
Profit from ordinary activities before income tax expense 12,070 2,248
Income tax expense relating to ordinary activities (3,000) (151)
9,070 2,097
(c) Movement in carrying amount of investments
Carrying amount of investments in associates at the beginning
of the year 12,910 16,958
– Investments in associates acquired during the year 1,669 2,134
– Dividends received from associates (1,773) (156)
– Share of net profits of associates for the financial year 9,070 2,097
– Share of decrement in associates' revaluation reserve for the
financial year (515) (8,123)
Carrying amount of investments in associates at the end of the year 21,361 12,910
(d) Share of assets and liabilities
Current assets 21,964 16,289
Non–current assets 36,137 33,655
Current liabilities (21,381) (18,299)
Non–current liabilities (15,359) (18,735)
Net assets 21,361 12,910
(e) Retained profits of the consolidated entity attributable to associates
Balance at the beginning of the year 7,918 5,977
Share of net profits of associates 9,070 2,097
less share of associates' dividends (1,773) (156)
Balance at the end of the year 15,215 7,918
(f) Reserves of the consolidated entity attributable to associates
Balance at the beginning of the year (8,123) (1,578)
Share of associates' reserves (515) (6,545)
Balance at the end of the year (8,638) (8,123)
71

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
10. INTERESTS IN JOINT VENTURE OPERATIONS
ACN 089 443 407 Pty Limited, a wholly owned subsidiary of AWB Limited, holds a 50% (2003: 50%) interest in a joint venture operation
Australian Independent Commodity Handlers (AICH). AICH manages a storage and handling facility known as the Melbourne Port Terminal. The
role of AWB in this joint venture is one of administration and part financing for the facility. ACN 089 443 407 Pty Limited does not participate in
the operation of the facility.
Consolidated
2004 2003
$'000 $'000
Net assets employed in the joint venture are included in the financial
statements as follows:
Property, plant and equipment 15,263 16,071
The consolidated entity also holds interests in the following research and development joint venture operations, for which no assets are employed.
Name Principal activity Interest
LongReach Plant Breeders Management Pty Ltd To undertake research projects with the aim of breeding 50.0%
and developing new proprietary varieties. The current research
project aim is to breed, develop and commercialise varieties of
feed wheat with improved nutrition, agronomic performance
and resistance to plant diseases that are well adapted to specified
growing areas in Australia.
Stored Grain Research Laboratory To undertake the funding, management and commercialisation 14.3%
of outputs of the Stored Grain Research Laboratory.
Graingene Agreement To generate intellectual property and germplasm. 33.3%
Capital expenditure commitments and contingent liabilities in respect of the joint venture operations are disclosed in Notes 28 and 29 respectively.
11. OTHER FINANCIAL ASSETS
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Current
Short-term deposits 515,829 36,005 – –
Financial assets 228,062 110,256 – –
Provision for counterparty risk (15,002) (8,368) – –
728,889 137,893 – –
Non–current assets
Shares
Controlled entities 33(a) – – 22,250 21,757
Other companies
– listed 140,220 130,889 – –
– unlisted 3,045 5,862 13,474 15,691
Memberships 1,306 1,315 453 1,315
144,571 138,066 36,177 38,763
12. INTANGIBLE ASSETS
Goodwill
At cost 544,369 536,134 – –
Accumulated amortisation (29,510) (2,737) – –
514,859 533,397 – –
Licence fees
At cost 233 217 233 212
Accumulated amortisation (63) (40) (63) (40)
170 177 170 172
515,029 533,574 170 172
72

13. PROPERTY, PLANT AND EQUIPMENT
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Freehold land – at cost 16,023 18,556 – 2,924
Buildings on freehold land
– at cost 63,788 64,106 – 8,809
– accumulated depreciation (11,993) (7,800) – (898)
51,795 56,306 – 7,911
Leasehold improvements
– at cost 20,324 11,715 – 433
– accumulated amortisation (5,420) (5,237) – (306)
14,904 6,478 – 127
Total land and buildings 82,722 81,340 – 10,962
Plant and equipment
– at cost 367,432 359,644 – 70,021
– accumulated depreciation (130,593) (90,541) – (26,066)
Total plant and equipment 236,839 269,103 – 43,955
Total property, plant and equipment 467,567 454,021 – 82,187
Total accumulated depreciation and amortisation (148,006) (103,578) – (27,270)
Total property, plant and equipment at net book value 319,561 350,443 – 54,917
Reconciliations
Reconciliations of the carrying amounts for each class of property, plant and equipment are set out below:
Freehold
Leasehold Plant and
land Buildings improvements equipment Total
$'000 $'000 $'000 $'000 $'000
Consolidated – 2004
Carrying amount at the beginning of the year
18,556 56,306 6,478 269,103 350,443
Additions
21 2,626 10,570 22,338 35,555
Disposals
(2,554) (3,907) (584) (3,238) (10,283)
Depreciation/amortisation expense
– (3,230) (1,556) (51,400) (56,186)
Net foreign currency difference on translation of self sustaining
foreign operations
– – (4) 36
32
Carrying amount at the end of the year 16,023 51,795 14,904 236,839 319,561
Consolidated – 2003
Carrying amount at the beginning of the year 6,180 18,291 182 145,866 170,519
Acquisitions through entity acquired 6,280 10,370 6,148 99,141 121,939
Additions 6,211 29,800 430 56,726 93,167
Disposals (115) (242) (11) (184) (552)
Recoverable amount write down – – – (7,182) (7,182)
Depreciation/amortisation expense – (1,913) (258) (25,244) (27,415)
Net foreign currency difference on translation of self sustaining
foreign operations – – (13) (20) (33)
Carrying amount at the end of the year 18,556 56,306 6,478 269,103 350,443
73

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
13. PROPERTY, PLANT AND EQUIPMENT (continued)
Freehold Leasehold Plant and
land Buildings improvements equipment Total
$'000 $'000 $'000 $'000 $'000
Parent entity – 2004
Carrying amount at the beginning of the year 2,924 7,911 127 43,955 54,917
Additions –
– – 54
54
Disposals (2,924) (7,859) (127) (43,854) (54,764)
Depreciation/amortisation expense –
(52) – (155) (207)
Carrying amount at the end of the year – – – – –
Parent entity – 2003
Carrying amount at the beginning of the year 2,924 7,977 91 47,819 58,811
Additions – 241 161 17,210 17,612
Disposals – – – (45) (45)
Recoverable amount write down – – – (7,182) (7,182)
Depreciation/amortisation expense – (307) (125) (13,847) (14,279)
Carrying amount at the end of the year 2,924 7,911 127 43,955 54,917
14. PAYABLES
Consolidated
AWB Limited
Notes 2004 2003 2004 2003
$'000 $'000 $'000 $'000
Trade creditors
– other persons/corporations 292,963 183,907 147 18,959
– related party (AWB National Pools) 144,490 20,549 – –
– wholly owned group – – 87,107 –
Other creditors 93,454 152,159 3,569 27,921
Goods and services tax payable 3,020 – 1 –
533,927 356,615 90,824 46,880
15. INTEREST BEARING LIABILITIES
Current
Interest bearing deposits 303,261 282,247 – –
Bank loans 168,823 69,965 – –
Loans
– related party (AWB National Pools) 26(b) 1,108,891 315,795 – 9,752
1,580,975 668,007 – 9,752
Non–current – unsecured
Bank loans 320,000 391,800 – –
Interest bearing deposits 1,131 3,077 – –
321,131 394,877 – –
Details of significant terms and conditions are included in Note 31(a).
74

15. INTEREST BEARING LIABILITIES (continued)
Financing arrangements
The consolidated entity has access to the following lines of credit:
Consolidated
2004 2003
FACILITY LIMIT
FACILITY LIMIT
Facility Balance Facility Balance
currency undrawn currency undrawn
Currency $'000 A$'000 A$'000 $'000 A$'000 A$'000
Committed credit facilities
Bank overdraft AUD 22,000 22,000 22,000 10,000 10,000 10,000
Liquidity support AUD 475,000 475,000 475,000 250,000 250,000 250,000
Liquidity support USD 25,000 34,882 34,882 – – –
Multi option facility – guarantee AUD – – – 310,000 310,000 –
Multi option facility – loan AUD 950,000 950,000 630,000 640,000 640,000 248,200
Syndicated loan facility AUD 750,000 750,000 750,000 – – –
2,231,882 1,911,882 1,210,000 508,200
Uncommitted credit facilities
Bank overdraft USD 20,000 27,906 27,906 20,000 29,590 29,590
US commercial paper USD 1,500,000 2,092,926 2,092,926 1,500,000 2,219,263 2,219,263
Domestic commercial paper AUD 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000
Euro commercial paper USD 1,500,000 2,092,926 2,092,926 1,500,000 2,219,263 2,219,263
Medium term notes AUD 500,000 500,000 400,000 – – –
6,713,758 6,613,758 6,468,116 6,468,116
Total facilities 8,945,640 8,525,640 7,678,116 6,976,316
16. PROVISIONS
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Current
Employee benefits 30 27,603 26,669 143 6,750
Litigation 5,056 5,200 2,857 2,900
Surplus leased premises and restoration 5,398 6,915 – –
Onerous contracts 8,948 1,548 – –
Restructure 2,025 10,317 1,611 5,000
49,030 50,649 4,611 14,650
Non–current
Employee benefits 30 4,744 1,721 36 1,721
Reconciliations
Reconciliations of the carrying amounts of litigation, surplus leased premises and restoration, onerous contracts and restructure provisions are set out
below:
Litigation
Carrying amount at the beginning of the year 5,200 2,900 2,900 2,900
Increase through acquisition of entity – 2,300 – –
Decrease from favourable foreign currency movements – (423) – (423)
Resolutions made during the year (335) (334) (43) (334)
Provision made during the year 191 757 – 757
Carrying amount at the end of the year 5,056 5,200 2,857 2,900
Surplus leased premises and restoration
Carrying amount at the beginning of the year 6,915 – – –
Increase through acquisition of entity – 6,915 – –
Provision made during the year – – – –
Utilised during the year (1,517) – – –
Carrying amount at the end of the year 5,398 6,915 – –
75

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
16. PROVISIONS (continued)
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Onerous contracts
Carrying amount at the beginning of the year 1,548 – – –
Provision made during the year 7,400 1,548 – –
Carrying amount at the end of the year 8,948 1,548 – –
Restructure
Carrying amount at the beginning of the year 10,317 – 5,000 –
Provision made during the year – 5,000 – 5,000
Increase through acquisition of entity – 5,317 – –
Payments made during the year (8,292) – (3,389) –
Carrying amount at the end of the year 2,025 10,317 1,611 5,000
17. OTHER LIABILITIES
Current
Financial liabilities 141,066 66,800 – –
Unearned income 2,611 9,458 – 1,001
Deferred gains – hedging contracts 1,767 3,684 – –
145,444 79,942 – 1,001
18. CONTRIBUTED EQUITY
(a) Issued and paid up capital
Ordinary shares fully paid 953,403 848,958 953,403 848,958
2004 2003
Number of
Number of
(b) Movements in ordinary share capital shares $'000 shares $'000
Movements in B class share capital during the period
were as follows:
Balance at the beginning of the year 315,161,984 848,958 273,408,454 700,312
Issued during the year
– institutional placement 2003: $3.70 per share
– employee share plan: nil per share 30
– equity share plan: nil per share
– – 41,100,000 152,070
453,768 – 116,078 –
– – 51,034 –
– staff ownership plan 2003: $3.90 per share – – 486,418 1,897
– share purchase plan 2003: $3.70 per share 11,840,908 43,811 – –
– dividend reinvestment plan 2003: $4.02 per share 8,941,196 35,944 – –
– staff ownership plan 2004: $4.48 per share 30 1,610,954 7,217 – –
– dividend reinvestment plan 2004: $4.41 per share 4,034,108 17,794 – –
less transaction costs – (321) – (5,321)
Balance at the end of the year 342,042,918 953,403 315,161,984 848,958
AWB Limited’s corporate structure consists of A class and B class shares. A class shares can only be owned by current wheat growers and specifically
exclude dividends. However, they confer on A class shareholders a number of rights, including the ability to elect the majority of the board of
directors. In contrast, B class shares can be owned by either wheat growers or non–wheat growers. B class shares carry rights to receive dividends
and the right to elect a minority of the board.
76

19. RESERVES AND RETAINED PROFITS
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
(a) Reserves
Underwriting loss reserve 15,000 15,000 15,000 15,000
Legal reserve 65 65 – –
Foreign currency translation reserve (16,589) (13,348) – –
(1,524) 1,717 15,000 15,000
Movement in foreign currency translation reserve:
Balance at the beginning of the year (13,348) (373) – –
Net translation adjustment (3,241) (12,975) – –
Balance at the end of the year (16,589) (13,348) – –
(b) Retained profits
Balance at the beginning of the year 78,337 72,815 52,640 29,712
Net profit attributable to members of AWB Limited 96,862 43,891 40,955 61,297
Dividend paid 22 (83,292) (38,369) (83,292) (38,369)
Balance at the end of the year 91,907 78,337 10,303 52,640
20. OUTSIDE EQUITY INTERESTS
Outside equity interest in controlled entities comprise:
Interests in retained profits at the beginning of the financial year
adjusted for outside equity interests in entities acquired or disposed
during the financial year 1,962 2,984 – –
Interests in profit from ordinary activities after income tax 789 259 – –
Interests in dividends paid (54) (91) – –
Interests in retained profits at the end of the financial year 2,697 3,152 – –
Interests in share capital 185 185 – –
Interests in reserves (423) (329) – –
Total outside equity interests 2,459 3,008 – –
21. TOTAL EQUITY RECONCILIATION
Balance at the beginning of the year 932,020 789,463 916,598 745,024
Total changes in equity recognised in the statement of
financial performance 93,621 30,916 40,955 61,297
Transactions with owners as owners
– Contributions of equity, net of transaction costs 18(b) 104,445 148,646 104,445 148,646
– Dividend provided for or paid 22 (83,292) (38,369) (83,292) (38,369)
– Total changes in outside equity interests 20 (549) 1,364 – –
Balance at the end of the year 1,046,245 932,020 978,706 916,598
77

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
22. DIVIDENDS
Dividends recognised in the current year by AWB Limited are as follows. All dividends are fully franked:
AWB Limited
2004 2003
$'000 $'000
Dividends paid during the year
– Interim – franked (14 cents per share) (2003: 14 cents per share) 47,321 38,369
– Final – franked 2003 (11 cents per share) 35,971 –
83,292 38,369
Subsequent events
On 24 November 2004, the directors declared a final dividend of 11 cents per share resulting in a dividend payable of $37.62 million. The financial
effect of this dividend has not been brought to account in the financial statements for the year ended 30 September 2004 and will be recognised in
subsequent reports.
Franking credit balance
30% franking credits available to shareholders of AWB Limited for subsequent financial years 55,293 26,476
Notional fully franked dividend based on available franking credits 129,017 61,777
The above available amounts are based on the balance of the dividend franking account at year end adjusted for:
(a) franking credits that will arise from the payment of the current tax liability;
(b) franking debits that will arise from the payment of dividends recognised as a liability at the year end;
(c) franking credits that will arise from the receipt of dividends recognised as receivables at the year end; and
(d) franking credits that the entity may be prevented from distributing in subsequent years.
The ability to use the franking credits is dependent upon there being sufficient available profits to declare dividends.
23. NOTES TO THE STATEMENT OF CASH FLOWS
Consolidated
AWB Limited
2004 2003 2004 2003
$'000 $'000 $'000 $'000
(a) Reconciliation of net profit from ordinary activities after income
tax expense to the net cash flows from operations
Profit from ordinary activities after income tax 97,651 44,150 40,955 61,297
Add/(less) non–cash items:
Net loss/(gain) on disposal of property, plant and equipment (5,545) (21) (5,185) 23
Depreciation 56,186 27,415 207 14,279
Amortisation 27,100 2,467 23 26
Share of profits of associates net of dividends received (7,297) (1,941) – –
Write down in the value of property plant and equipment to
recoverable amount – 7,182 – 7,182
Write down in the value of investment in associate to recoverable amount 2,806 – 2,806 –
Increase/(decrease) in income tax payable 50,642 (26,518) 34,076 13,056
Increase/(decrease) in deferred income tax liability 5,951 (11,388) 10,380 (470)
Decrease/(increase) future income tax benefit 1,427 (1,678) (35,032) (732)
Changes in assets and liabilities adjusted for the effects of
purchasing a controlled entity during the financial year:
Trade receivables (502,950) 342,716 – –
Grower loan receivables (161,981) 1,063,445 – –
Inventories 4,416 66,914 – –
Prepayments and other debtors (1,817) 5,354 (1,217) 873
Trade and other creditors 96,974 20,323 33,017 (26,495)
Provisions 1,405 5,874 (11,723) 5,568
Net cash flow from/(used in) operating activities (335,032) 1,544,294 68,307 74,607
78

23. NOTES TO THE STATEMENT OF CASH FLOWS (continued)
Consolidated
AWB Limited
2004 2003 2004 2003
$'000 $'000 $'000 $'000
(b) Reconciliation of cash
Cash balance comprises:
– cash at bank and on hand 44,023 25,066 87,890 2,328
– cash on deposit 4,202 29,719 – –
Closing cash balance 48,225 54,785 87,890 2,328
24. DIRECTOR AND EXECUTIVE DISCLOSURES
(a) Remuneration of specified directors and specified
executives by the consolidated entity
Remuneration levels are competetively set to attract and retain
appropriately qualified experienced directors and executives.
Remuneration for specified executives is divided into two components.
The first is the fixed component, referred to as “total cost”, which is made
up of base salary and benefits, including superannuation benefits. The
second component is the “at risk” component which includes the short
term incentives that take the form of cash, and long–term incentives
provided via an equity plan. The amount of at risk remuneration, if any,
that is earned by an executive is wholly dependent upon the performance
of the individual, the team and the businesses against pre–determined Key
Performance Indicators (KPIs) and performance hurdles approved by the
board.
The cost and value of all of the components are considered as a whole.
AWB’s remuneration policy is to pay at the median level of remuneration
for target performance and to provide the opportunity for upper decile
rewards for distinctive (upper decile) performance. Details of each at risk
element of remuneration are set out below.
At risk remuneration
At risk remuneration is delivered as short and long term incentives under
AWB’s remuneration policies.
The short-term incentive (STI) is cash based and applies to eligible
employees across the business, including the group’s executive
management team. The STI is calculated for each eligible employee by
assessing performance in relation to KPIs. KPIs are based on group,
individual business/revenue stream and personal measures with three levels
of performance against each KPI: threshold (the minimum necessary to
qualify for any reward); target (where the performance requirements have
been met); and stretch (where performance requirements are exceeded).
Eligible employees are those who have been employed by the AWB Group
for a minimum of six months during the year ended 30 September 2004.
The maximum STI payment is between 10% and 100% of an employee's
total cost. Senior employees and those with revenue generating
accountability generally have the highest STI potential. The AWB Group
measure under the STI is based on profit before tax and amortisation.
Performance against this measure has a weighting in the range of 30% to
50% of the overall STI for an AWB Group employee. The Managing
Director is also assessed against specific health, safety and environmental
targets as Group measures.
Long term incentive is provided for the Managing Director via a cash
based plan, the executive management team and selected senior executives
via the Performance Rights Plan, and for all other employees via the
Employee Share Plan and the Staff Ownership Plan. A description of the
operation and conditions of these plans is included later in this note and
in Note 30. AWB’s equity–based remuneration plans have been approved
by shareholders and offers and payments made under the plans comply
with thresholds set in the plans.
Remuneration structure
It is AWB’s policy that service contracts for senior executives be unlimited
in term but capable of termination on not more than 12 months notice
and that AWB retains the right to terminate the contract immediately, by
making a payment equal to not more than 12 months pay in lieu of notice.
The Managing Director and Chief Financial Officer have fixed term
contracts which will expire on 30 September 2008 unless terminated earlier
or extensions of the contracts are negotiated. AWB retains the right to
terminate these contracts earlier with the provision of 12 months notice or
payment in lieu of notice.
The Remuneration Committee has determined that it will limit notice
periods to 12 months in all future contracts for executives, unless
exceptional circumstances exist.
The service contracts typically outline the components of remuneration
paid to executives but do not prescribe how remuneration levels are to be
modified from year to year. Remuneration levels are reviewed annually, to
take account market relativities, individual performance and the businesses’
capacity to pay, thereby ensuring alignment with the principles of the
remuneration policy are maintained.
Remuneration of non–executive directors
The AWB Limited constitution requires that the remuneration of directors
for their services as directors be by fixed sum and not a commission on or a
percentage of profits or operating revenue. At the 2004 Annual General
Meeting, shareholders determined that the maximum aggregate
remuneration for all non–executive directors of AWB Limited is
$1,200,000 per annum.
All non–executive directors are paid a fixed fee in cash. The fixed fee
amounts are determined by the board, with the assistance of the
Remuneration Committee and external advisers.
The following principles are applied in determining the amount of
remuneration for non–executive directors:
the amount of time required for directors to consider AWB and board
matters including preparation time;
acknowledgement of the personal risk borne as a company director;
a comparison with professional market rates of remuneration and those
offered by comparative companies and external independent advice as to
appropriate levels to remain competitive with the market, having regard
to companies of similar size and complexity; and
the desire to attract directors of a high calibre, with appropriate levels of
expertise and experience.
The non–executive directors do not receive equity based remuneration or
performance based remuneration. Other than statutory superannuation,
there are no schemes for retirement benefits for non–executive directors.
The non–executive directors are currently paid a fixed fee of $90,000 per
annum (from 11 March 2004). The chairman receives 2.5 times this
amount. An additional amount of $25,000 per annum is paid to the Chair
of the Audit Committee and an additional amount of $20,000 per annum
is paid to the Chair of the Group Corporate Risk Committee. (These
amounts include statutory superannuation.)
79

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
24. DIRECTOR AND EXECUTIVE DISCLOSURES (continued)
(a) Remuneration of specified directors and specified executives by the consolidated entity (continued)
The following tables provides the details of all directors of the company (specified directors) and the five or more executives of the consolidated
entity with the greatest authority (specified executives) and the nature and amount of the elements of their remuneration for the year ended 30
September 2004:
PRIMARY
POST EMPLOYMENT
Long–term
Superannuation
Salary and fees incentive 1 Other 2 benefits Total
$ $ $ $ $
Specified directors
Non–Executive
Brendan Stewart (Chairman) 186,507 – – 16,786 203,293
Robert Barry (Deputy Chairman) 96,639 – – 7,693 104,332
Steve Chamarette 40,065 – – 10,016 50,081
(appointed 11 March 2004)
Brendan Fitzgerald 50,145 – – 29,120 79,265
Laurie Marshall 30,000 – – 2,700 32,700
(resigned 11 March 2004)
Xavier Martin 72,720 – – 6,545 79,265
Warrick McClelland 31,706 – – 47,559 79,265
Christopher Moffet 72,720 – – 6,545 79,265
Peter Polson 91,854 – – 8,267 100,121
Kerry Sanderson 72,720 – – 6,545 79,265
John Simpson 72,720 – – 6,545 79,265
John Thame 72,720 – – 6,545 79,265
Executive
Andrew Lindberg (Managing Director) 783,293 402,167 304,566 105,159 1,595,185
Total, all specified directors 1,673,809 402,167 304,566 260,025 2,640,567
1 A long-term incentive plan for the Managing Director was established in the 2002 financial year, whereby the Managing Director was given the
opportunity to receive cash incentives by participating in the plan. Under the plan, notional performance rights are issued to the Managing
Director. The terms and conditions of the plan are consistent with the Performance Rights Plan except that the benefit is delivered in cash. The fair
value of the notional performance rights is calculated at each reporting date using a Black–Scholes model and allocated to each reporting period
evenly over the period from grant date to vesting date. The value disclosed above is the portion of the fair value of all the notional performance
rights that have been granted.
On 30 May 2002, a total of 107,692 notional performance rights were issued. The performance period for these rights commenced on 1 October
2004 and ends on 1 October 2006.
On 1 October 2002, a further 125,641 notional performance rights were issued. The performance period for these rights commences on 1
October 2005 and ends on 1 October 2007.
On 1 October 2003, a further 142,450 notional performance rights were issued. The performance period for these rights commences on 1
October 2006 and ends on 1 October 2008.
2 “Other” remuneration includes an amount paid on renewal of Mr Lindberg's contract and an amount paid as part of sign–on fee from his previous
contract. It also includes motor vehicle allowances subject to fringe benefits tax.
80

24. DIRECTOR AND EXECUTIVE DISCLOSURES (continued)
(a) Remuneration of specified directors and specified executives by the consolidated entity (continued)
PRIMARY POST EQUITY OTHER
EMPLOYMENT
Amortised
Short–term value of Retention
incentive Super– performance and
Salary (2002/03 Non annuation rights termination
and fees year) 3 monetary 4 Other 5 benefits issued 6 benefits 7 Total
$ $ $ $ $ $ $ $
Specified executives
Richard Fuller, General Manager, 259,895 – 1,008 23,153 11,148 11,446 – 306,650
Executive and Company Secretary
Peter Geary, General Manager, 418,828 – 2,290 30,273 35,138 20,603 – 507,132
Trading and Commodities
Jill Gillingham, General Manager, 413,751 – 153 4,566 67,000 20,603 – 506,073
Supply Chain, Technology and
Business Processes
Paul Ingleby, Chief Financial Officer 616,520 – 3,630 26,984 11,148 34,325 – 692,607
Marcus Kennedy, General Manager, 412,520 – 1,140 68,816 11,148 11,910 – 505,534
Financial Services
John Maher, General Manager, 334,551 – 1,879 18,913 20,436 – 125,000 500,779
Network Operations
Sarah Scales, General Manager, 435,415 – 153 7,168 11,437 17,503 – 471,676
AWBI
Charles Stott, General Manager, 414,836 – 2,005 4,566 11,148 16,489 – 449,044
Rural Services
Michael Thomas, General Manager, 338,219 – 3,389 – 35,000 4,254 – 380,862
Corporate
Mark Allison, Managing Director 84,023 – – 26,946 12,582 – 875,326 998,877
Landmark
(resigned 27 November 2003)
Total, all specified executives 3,728,558 – 15,647 211,385 226,185 137,133 1,000,326 5,319,234
3 The STI component of remuneration in 2004 relates to performance incentives that would have been paid in the current financial year. Cash and
long–term incentive payments are granted annually, after the end of the year. The grant date is tied to the performance appraisal, which, for the
prior year, was completed after 30 September 2003. The specific service and performance criteria are set out earlier in this note. During this
reporting period, no incentives were paid to executives. The STI program was suspended in relation to the 2003 financial year in recognition of the
very tough operating conditions encountered during that period. An accrual has been made in the financial statements, based on an estimate of the
incentives to be paid in respect of the year ended 30 September 2004. The actual incentives to be paid have not been determined at the date of this
report, but are estimated to be in the order of $1.8 million. The incentives will be disclosed as remuneration in the 2005 financial report.
4 Interest free portion of loan under the employee share schemes (refer Note 30).
5 “Other” remuneration in the case of specified executives, includes motor vehicles, housing benefits and other allowances subject to fringe benefits tax.
6 The fair value of the rights is calculated at the date of grant using a Black–Scholes model and allocated to each reporting period evenly over the
period from grant date to vesting date. The value disclosed above is the portion of the fair value of all the rights that have been granted. Directors
are not entitled to participate in performance rights plans.
7 A termination payment was made to the former Managing Director of Landmark, Mark Allison (resigned 27 November 2003). A retention
payment was made to Mr Maher following the acquisition of Landmark.
81

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
24. DIRECTOR AND EXECUTIVE DISCLOSURES (continued)
(a) Remuneration of specified directors and specified executives by the consolidated entity (continued)
The fair value of the performance rights is calculated at the date of grant using a Black–Scholes model and allocated to each reporting period evenly
over the period from grant date to vesting date. The value disclosed above is the portion of the fair value of all the performance rights that have been
granted.
The following factors and assumptions were used in determining the fair value of performance rights on grant date:
Fair value per Exercise Price of shares Estimated Risk free Dividend
Grant date Expiry date performance right price (i) on grant date volatility interest rate yield
1 October 2001 1 October 2005 $2.61 $1.00 $3.39 14% 5.5% 6.5%
1 October 2002 1 October 2006 $2.59 $1.00 $3.47 14% 5.3% 7.2%
1 October 2003 1 October 2007 $3.01 $1.00 $3.90 13% 5.3% 6.4%
(i) The total consideration payable on the exercise of any performance rights on a particular day will be one dollar in total (irrespective of the number
of rights exercised on that day).
Estimated volatility approximates historic volatility. The estimated life of all performance rights granted is four years. Each performance right entitles
the holder to purchase one ordinary B class share in the company.
Each performance right is over one unissued B class share in AWB Limited. The performance rights are issued at no cost and become exercisable
depending on the performance of the company (based on total shareholder return) relative to the performance of the S&P/ASX200. The number of
performance rights which become exercisable depends on the company’s ranking relative to companies comprised in the S&P/ASX200 on total
shareholder return in the performance period. This ranking is calculated at the end of each quarter and expressed as a percentile. The rights may
become exercisable on a progressive basis once the company’s ranking for the quarter reaches 50. Fifty percent of the rights become exercisable when
the company’s ranking reaches 50. All the rights become exercisable if the company’s ranking for the quarter exceeds 75. The percentage of rights
which become exercisable increases proportionately if the company ranks between 50 and 75 for the quarter.
The expiry date disclosed is one year after vesting date, given that while the performance rights expire 10 years after the grant date, the expected
expiry of the performance rights is at this time.
(b) Performance rights over equity instruments granted as remuneration
During the reporting period, the following rights over ordinary shares were granted during the current year under the Performance Rights plan:
Right holdings
Specified executives
Richard Fuller
Peter Geary
Jill Gillingham
Paul Ingleby
Marcus Kennedy
John Maher
Sarah Scales
Charles Stott
Michael Thomas
Held at
Held at Granted as 30 September
1 October 2003 remuneration 2004
33,747
60,486
60,486
101,124
38,043
–
51,649
48,717
13,587
21,319
34,886
34,886
63,053
43,930
25,195
32,948
31,010
27,133
55,066
95,372
95,372
164,177
81,973
25,195
84,597
79,727
40,720
No rights vested during the current year. No performance rights held by specified executives are vested but not exercisable.
82

24. DIRECTOR AND EXECUTIVE DISCLOSURES (continued)
(c) Equity holdings and transactions
The movement during the reporting period in the number of ordinary shares of AWB Limited held, directly, indirectly or beneficially, by each
specified director and specified executive, including their personally related entities, is as follows:
A class shares held in
AWB Limited (number)
B class shares held in
AWB Limited (number)
Held at Balance at Net change Held at
30 September 2004 1 October 2003 other 30 September 2004
Specified directors
Brendan Stewart 1 15,425
Robert Barry 1 40,579
Andrew Lindberg – 71,574
Brendan Fitzgerald 1 12,000
Xavier Martin 1 70,695
Warrick McClelland 1 68,035
Christopher Moffet 1 100,577
Peter Polson – –
Kerry Sanderson – 5,000
John Simpson 1 99,672
John Thame – 5,000
Steve Chamarette 1 500
Specified executives
Richard Fuller – 10,943
Peter Geary 1 12,680
Jill Gillingham – 13,700
Paul Ingleby – 30,240
Marcus Kennedy – –
John Maher – –
Sarah Scales – 4,200
Charles Stott – 8,200
Michael Thomas – 13,639
1,351 16,776
– 40,579
1,351 72,925
– 12,000
1,351 72,046
– 68,035
– 100,577
5,000 5,000
– 5,000
20,000 119,672
– 5,000
– 500
3,570 14,513
8,370 21,050
371 14,071
4,307 34,547
4,686 4,686
7,583 7,583
7,680 11,880
8,907 17,107
1,476 15,115
There was no movement during the year for the A class shareholdings of specified directors and specified executives.
(d) Loans and other transactions with specified directors and specified executives
Loans
Details regarding the aggregate of loans made by any entity in the consolidated entity to each group of specified directors and specified executives
and their personally related entities, and the number of individuals in each group, are as follows:
Opening Closing Interest paid Number in group at
balance balance and payable 30 September 2004
$ $ $
Specified directors
2004 456,673 1,440,188 110,461 2
Specified executives
2004 43,043 264,054 15,647 9
For all loans to directors, interest is payable at prevailing commercial interest rates. The terms are no more favourable than those available to other
suppliers and customers.
A notional interest charge has been included in specified executives' total remuneration for employee interest free share loans.
83

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
24. DIRECTOR AND EXECUTIVE DISCLOSURES (continued)
(d) Loans and other transactions with specified directors and specified executives (continued)
Details regarding loans outstanding at the reporting date to specified directors and specified executives and their personally related entities, where the
individual’s aggregate loan balance exceeded $100,000 at any time in the reporting period, are as follows:
Interest paid
and payable
Balance at Balance at in the reporting Highest balance
1 October 2003 30 September 2004 period in period
$ $ $ $
Specified directors
Christopher Moffet 377,183 1,290,599 96,340 1,993,930
Brendan Stewart – 149,589 14,121 263,804
(e) Other transactions with the company or its controlled entities
Mr John Thame is a director of St George Bank Limited. All transactions with this company were in the ordinary course of business on normal
commercial terms and conditions.
Mrs Kerry Sanderson is Chief Executive and General Manager of Fremantle Ports Authority in Western Australia. A major portion of the Western
Australian harvest was shipped through the Port of Fremantle. All transactions with this authority were in the ordinary course of business on normal
commercial terms and conditions.
A number of specified directors and specified executives, or their personally related entities, hold positions in other entities that result in them having
control or significant influence over the financial or operating policies of those entities.
These entities transacted with the company or its subsidiaries in the reporting period. The terms and conditions of those transactions were no more
favourable than those available, or which might reasonably be expected to be available, on similar transactions to unrelated entities on an arm’s length
basis.
The aggregate amounts recognised in respect of the following types of transactions, during the year with specified directors and their
personally–related entities, were as follows:
2004
Transaction Specified directors $
Purchases – grains Messrs Stewart, Barry, Martin and Simpson 1,617,057
Rural commercial sales Messrs Stewart, Chamarette, Fitzgerald, Moffet, Martin and Simpson 1,385,031
From time to time, specified directors and specified executives of the company or its controlled entities, or their personally related entities, may
purchase goods from the consolidated entity. These purchases are on terms and conditions no more favourable than those entered into by unrelated
customers and are trivial or domestic in nature.
25. AUDITORS' REMUNERATION
Amounts received or due and receivable by the auditors of the company for:
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $ $ $ $
Audit services 1,382,984 679,805 260,000 260,000
Other services
– internal audit services – 23,000 – 23,000
– other services 23,582 49,895 – 15,495
1,406,566 752,700 260,000 298,495
84

26. RELATED PARTY DISCLOSURES
(a) AWB Limited is the ultimate parent entity.
(b) The following related party transactions occurred during the period:
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
Borrowing costs expensed
– wholly owned group – – 1,992 901
– related party (AWB National Pools) 19,143 10,353 770 –
Revenue from sale of goods
– related party (AWB National Pools) 1,983,929 409,720 – 8,991
Management fee revenue
– wholly owned group – – 2,456 50,877
– related party (AWB National Pools) 95,198 77,091 – 77,091
Dividends
– wholly owned group – – 57,332 41,600
– other subsidiaries – – 42 53
– associates – – – 155
Interest revenue
– wholly owned group – – 84,915 32,193
– related party (AWB National Pools) 8,345 2,426 – –
Current receivable from:
– wholly owned group – – 787,060 839,385
– related party (AWB National Pools) 691,184 162,100 7 –
Non–current receivable from:
– wholly owned group – subordinated loan – – 165,000 50,000
Current payable to:
– related party (AWB National Pools) 1,108,891 315,795 – 9,752
Terms and conditions
Interest is charged or credited on amounts with AWB Limited at prevailing commercial interest rates. All other transactions within the AWB Limited
consolidated entity are based on actual amounts incurred or received and are conducted on commercial terms and conditions.
Consolidated
AWB Limited
2004 2003 2004 2003
$ $ $ $
(c) Related party transactions with director related entities:
Purchases
Messrs Stewart, Barry, Moffet, Martin, Chamarette,
Simpson, McClelland, Gibson, Donges 4,667,695 3,366,487 – –
The above transactions were conducted with director related entities under normal commercial terms with conditions no more favourable than those
available to other suppliers and customers.
85

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
27. SEGMENT INFORMATION
Business segments
Intersegment pricing is determined on an arm's length basis. Segment results, assets and liabilities include items directly attributable to a segment as
well as those that can be allocated on a reasonable basis. Segment capital expenditure is the total cost incurred during the period to acquire segment
assets that are expected to be used for more than one period.
The consolidated entity comprises the following main business segments, based on the consolidated entity’s management reporting system:
Pool Rural Grain Supply Chain
Finance and Risk Management Services Acquisition and Other Other/ Intersegment
Management Services (Landmark) and Trading Investments Corporate eliminations Consolidated
2004 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
Revenue
External segment revenue 1,258,286 98,530 1,658,778 2,195,603 108,838 24,610 – 5,344,645
Intersegment revenue 8,916 73 17,337 6,947 1,149 321,509 (355,931) –
Total consolidated revenue 1,267,202 98,603 1,676,115 2,202,550 109,987 346,119 (355,931) 5,344,645
Results
Consolidated entity profit from
ordinary activities before
income tax expense 29,954 27,460 72,575 81,040 (9,906) (54,070) – 147,053
Income tax expense (49,402)
Net profit attributable to
outside equity interests – – (671) – (118) – – (789)
Net profit attributable to members of AWB Limited 96,862
Assets
Segment assets 1,672,496 3,725 793,187 505,877 200,238 1,764,801 (1,246,742) 3,693,582
Unallocated corporate assets 41,617
Total assets 3,735,199
Liabilities
Segment liabilities 1,538,584 1,311 569,141 426,160 184,278 368,399 (452,622) 2,635,251
Unallocated corporate liabilities 53,703
Total liabilities 2,688,954
Other segment information
Equity method investments
included in segment assets – – 8,526 – 12,835 – – 21,361
Acquisition of non–current assets – – 20,878 223 1,961 12,493 – 35,555
Depreciation and amortisation – – 28,887 109 12,706 41,584 – 83,286
Non–cash expenses other than
depreciation and amortisation (470) – (1,478) 22,307 – 914 – 21,273
Geographical segments
AWB Limited and its controlled entities operate predominantly in one geographical segment, being Australia.
86

27. SEGMENT INFORMATION (continued)
Pool Rural Grain Supply Chain
Finance and Risk Management Services Acquisition and Other Other/ Intersegment
Management Services (Landmark) and Trading Investments Corporate eliminations Consolidated
2003 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
Revenue
External segment revenue 276,242 79,464 121,681 1,662,580 69,253 2,670 – 2,211,890
Inter segment revenue 24,183 9,146 661 6,216 1,863 95,905 (137,974) –
Total consolidated revenue 300,425 88,610 122,342 1,668,796 71,116 98,575 (137,974) 2,211,890
Results
Consolidated entity profit from
ordinary activities before
income tax expense 36,107 18,918 3,666 24,658 (20,377) (4,065) – 58,907
Income tax expense (14,757)
Net profit attributable to
outside equity interests – – (14) – (245) – – (259)
Net profit attributable to members of AWB Limited 43,891
Assets
Segment assets 643,929 3,284 687,627 374,382 203,503 2,197,553 (1,672,381) 2,437,897
Unallocated corporate assets 56,488
Total assets 2,494,385
Liabilities
Segment liabilities 653,559 2,830 527,818 341,728 214,867 1,450,675 (1,639,666) 1,551,811
Unallocated corporate liabilities 10,554
Total liabilities 1,562,365
Other segment information
Equity method investments
included in segment assets – – 2,603 – 10,307 – – 12,910
Acquisition of non–current assets 3,216 – – 301 72,038 17,612 – 93,167
Depreciation and amortisation – – 1,468 77 11,600 16,737 – 29,882
Non–cash expenses other than
depreciation and amortisation – – – 2,769 9,915 11,852 – 24,536
Geographical segments
AWB Limited and its controlled entities operate predominantly in one geographical segment, being Australia.
87

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
28. EXPENDITURE COMMITMENTS
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
At 30 September, the consolidated entity had contracted for but not
provided in the financial report:
(i) Grain sales
Contracts for the sale of grain not later than one year but subject to
variation of +/–10% outturn tolerance 202,467 50,045 – –
Contracts for the sale of grain later than one year but not later than
five years but subject to variation of +/–10% outturn tolerance 764 – – –
(ii) Grain purchases
Contracts for the purchase of grain not later than one year subject
to variation for quality characteristics 132,445 47,593 – –
Contracts for the purchase of grain later than one year but not later
than five years subject to variation for quality characteristics 7,467 – – –
(iii) Freight sales
Contracts for the sale of freight not later than one year 81,054 – – –
(iv) Freight purchases
Contracts for the purchase of freight not later than one year 79,813 – – –
(a) Capital expenditure commitments
Estimated capital expenditure contracted for at balance date
but not provided for:
– payable not later than one year
– joint venture operations 3,899 3,514 – 3,514
– other 4,767 17,101 – –
– payable later than one year but not later than five years
– joint venture operations 8,325 9,283 – 9,283
– other – – –
16,991 29,898 – 12,797
(b) Lease expenditure commitments
Operating leases (non–cancellable)
– payable not later than one year 6,676 3,997 – 2,863
– payable later than one year but not later than five years 12,562 17,624 – 16,935
– payable later than five years 24,635 26,590 – 26,565
43,873 48,211 – 46,363
These lease commitments represent payments due for the head office, regional and overseas offices and motor vehicles under operating leases. The
head office lease is for 12 years commencing in the 2004 financial year. The remaining operating leases have an average lease term of three years.
Lease payments comprise a base amount plus an incremental contingent rental. Contingent rentals are based on the contract terms.
(c) Other expenditure commitments
– payable not later than one year 1,702 600 – 600
– payable later than one year but not later than five years 895 – – –
2,597 600 – 600
88

29. CONTINGENT LIABILITIES
Consolidated
2004 2003
$'000 $'000
Litigation claims
Several claims for damages and costs were lodged against AWB Limited and its controlled entities
which denied liability and defended the claims. The maximum damages/costs claimed but not
otherwise recognised in the statement of financial position were estimated to amount to: 2,844 4,393
30. EMPLOYEE ENTITLEMENTS AND SUPERANNUATION COMMITMENTS
Consolidated
AWB Limited
2004 2003 2004 2003
Notes $'000 $'000 $'000 $'000
The aggregate employee entitlement liability is comprised of:
– Provisions 32,347 28,390 179 8,471
Number
Number
Number of full time equivalent employees at the end of the year 2,730 2,729 1 544
Staff Ownership Plan
An employee share offer was made to employees of AWB who were eligible employees as at December 2003. AWB offered eligible employees an
interest free loan (fully repayable at the end of 10 years or upon resignation). 1,307 (2003: 222) permanent employees participated in this offer with
1,610,954 (2003: 486,418) shares being allocated, with a value of $7,217,074 (2003: $1,897,030).
Employee Share Plan
In January 2004, a third offer was made under the employee share plan which was established in 2002, where all permanent employees of the
consolidated entity were entitled to be issued with B class shares in AWB Limited. Each permanent employee who participated received shares to the
value of $1,000 (based on share price at issue date). Shares were provided under the scheme to a total of 2,044 employees. The shares were issued
for nil consideration. The shares are quoted on the ASX.
During the year, a total of 453,768 (2003: 116,078) B class shares were issued to employees under the plan. The total value of the shares at the date
of issue was $2,037,418. It is the policy of AWB not to charge the value of the shares issued as an employee benefits expense. In accordance with this
policy, no amounts have been recognised in respect of the share issue during the year.
Superannuation commitments
All employees are able to choose where their superannuation contributions are directed, in line with AWB Packaging Policy and Australian Taxation
Office rules. AWB also offers a default fund, AWB Staff Superannuation Plan, which is a subset of the Mercer Retirement Trust for all other
employees. As all schemes are accumulation schemes, AWB has no future superannuation liabilities to report.
Performance Rights Plan
A Performance Rights Plan exists, whereby selected senior employees (including specified executives) of the consolidated entity are given the
opportunity to acquire rights over unissued B class shares in AWB Limited by participating in the plan.
The terms and valuation of performance rights granted are consistent with those granted to specified executives (refer Note 24).
At the date of this report, unissued ordinary shares of the company under the Performance Rights Plans are:
Grant date Expiry date Exercise price (i) Number of shares
1 October 2001 1 October 2005 $1.00 169,659
1 October 2002 1 October 2006 $1.00 359,864
1 October 2003 1 October 2007 $1.00 434,965
964,488
(i) The total exercise price payable on the exercise of any performance rights on a particular day will be one dollar in total (irrespective of the number
of rights exercised on that day).
89

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
31. FINANCIAL INSTRUMENTS
(a) Interest rate risk
The consolidated entity's exposure to interest rate risks and the effective weighted average interest rates of financial assets and financial liabilities are
as follows:
2004
Financial assets
Cash assets 5 n/a 0.37
Receivables 6 n/a n/a
Short-term deposits 11 n/a 1.78
Initial margin deposits 11 1.00 1.50
Financial assets – other 11 n/a n/a
FIXED INTEREST RATE MATURING IN
Floating More Non–
interest 1 year Over 1 than interest
Weighted average interest rate % rate or less to 5 years 5 years bearing Total
Notes CAD USD AUD $'000 $'000 $'000 $'000 $'000 $'000
1.34 48,225 – – – – 48,225
7.30 575,217 – – – 1,139,394 1,714,611
5.31 515,829 – – – – 515,829
4.75 4,963 – – – – 4,963
n/a – – – – 367,670 367,670
1,144,234 – – – 1,507,064 2,651,298
Financial liabilities
Payables 14 n/a n/a n/a – – – – 533,927 533,927
Interest bearing liabilities 15 n/a 1.82 5.39 1,802,106 100,000 – – – 1,902,106
Financial liabilities – other 17 n/a n/a n/a – – – – 141,066 141,066
1,802,106 100,000 – – 674,993 2,577,099
Unrecognised financial derivatives – face value
Assets
Interest rate swaps n/a n/a 5.46 65,000 25,000 – – – 90,000
Interest rate options n/a n/a 5.81 – 615,000 – – – 615,000
Interest rate futures n/a n/a 5.28 – 2,000 – – – 2,000
65,000 642,000 – – – 707,000
Liabilities
Interest rate swaps n/a n/a 5.62 25,000 15,000 50,000 – – 90,000
Interest rate options n/a n/a 5.22 – 250,000 – – – 250,000
Interest rate futures n/a n/a 5.40 – 24,000 – – – 24,000
25,000 289,000 50,000 – – 364,000
90

31. FINANCIAL INSTRUMENTS (continued)
(a) Interest rate risk (continued)
FIXED INTEREST RATE MATURING IN
Floating More Non–
interest 1 year Over 1 than interest
Weighted average interest rate % rate or less to 5 years 5 years bearing Total
2003 Notes CAD USD AUD $'000 $'000 $'000 $'000 $'000 $'000
Financial assets
Cash assets 5 n/a 1.18 1.34 54,785 – – – – 54,785
Receivables 6 n/a n/a 7.07 432,856 – – – 573,626 1,006,482
Short-term deposits 11 n/a n/a 4.77 36,005 – – – – 36,005
Initial margin deposits 11 1.10 0.45 5.78 5,387 – – – – 5,387
Financial assets – other 11 n/a n/a n/a – – – – 242,935 242,935
529,033 – – – 816,561 1,345,594
Financial liabilities
Payables 14 n/a n/a n/a – – – – 356,615 356,615
Interest bearing liabilities 15 n/a 1.65 4.93 963,805 92,595 4,678 – 1,806 1,062,884
Financial liabilities – other 17 n/a n/a n/a – – – – 66,800 66,800
963,805 92,595 4,678 – 425,221 1,486,299
Unrecognised financial derivatives – face value
Assets
Interest rate swaps n/a n/a n/a 90,000 – – – – 90,000
Interest rate options n/a n/a 4.90 – 340,000 – – – 340,000
Interest rate futures n/a n/a 4.98 – 30,000 – – – 30,000
90,000 370,000 – – – 460,000
Liabilities
Interest rate swaps n/a n/a 5.75 – – 90,000 – – 90,000
Interest rate options n/a n/a 4.09 – 295,000 – – – 295,000
Interest rate futures n/a n/a 4.96 – 15,000 – – – 15,000
– 310,000 90,000 – – 400,000
91

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
31. FINANCIAL INSTRUMENTS (continued)
(b) Foreign exchange risk
The consolidated entity enters into forward exchange contracts and options, in accordance with board approved limits for the following purposes; to
hedge (or hedge a proportion of ) sale and purchase commitments denominated in foreign currencies and for trading purposes.
The following table sets out the gross value to be settled under foreign currency contracts, the weighted average exchange rates and the settlement
periods of outstanding contracts for the consolidated entity. All amounts are stated at the Australian dollar equivalent.
Consolidated
2004 2003 2004 2003
Forward exchange contracts Weighted average rate $'000 $'000
Settlement not later than one year
Buy US dollars, Sell Australian dollars 0.7025 0.6432 235,888 358,582
Sell US dollars, Buy Australian dollars 0.7046 0.6437 (366,669) (478,215)
Buy US dollars, Sell euro – 1.1268 – 360,820
Sell US dollars, Buy euro – 1.1242 – (339,212)
Buy euro, Sell US dollars – 1.1242 – 350,749
Sell euro, Buy US dollars – 1.1268 – (372,246)
Buy Canadian dollars, Sell Australian dollars 0.9215 0.8918 62,440 43,406
Sell Canadian dollars, Buy Australian dollars 0.9252 0.8729 (103,665) (51,050)
Buy US dollars, Sell Canadian dollars – 1.4142 – 148
Sell Canadian dollars, Buy US dollars – 1.4142 – (155)
Buy Canadian dollars, Sell US dollars 1.2990 1.5040 6,541 411
Sell US dollars, Buy Canadian dollars 1.2990 1.5040 (6,390) (370)
Buy CHF francs, Sell US dollars 1.2641 1.3434 332 2,238
Sell US dollars, Buy CHF francs 1.2641 1.3434 (328) (2,203)
Buy GBP pounds, Sell Australian dollars – 2.4444 – 2,444
Sell GBP pounds, Buy Australian dollars – 2.4588 – (2,459)
Sell euro, Buy Australian dollars 1.2641 – (1,765) –
Sell New Zealand dollars, Buy Australian dollars 1.0666 – (1,000) –
Total not later than one year (174,616) (127,112)
Settlement later than one year but not later than two years
Buy US dollars, Sell Australian dollars 0.6987 0.6190 1,069 1,233
Sell US dollars, Buy Australian dollars 0.6921 0.6172 (1,296) (1,236)
Buy Canadian dollars, Sell Australian dollars 0.8696 0.8849 1,438 1,729
Sell Canadian dollars, Buy Australian dollars 0.8896 0.8823 (8,146) (1,678)
Total later than one year but not later than two years (6,935) 48
Total (181,551) (127,064)
92

31. FINANCIAL INSTRUMENTS (continued)
(b) Foreign exchange risk (continued)
Consolidated
2004 2003 2004 2003
Currency options Weighted average strike rate $'000 $'000
Not later than one year
Buy Australian dollar Call, US dollar Put 0.7345 0.6729 56,445 60,108
Buy Australian dollar Put, US dollar Call 0.6914 0.6460 (14,514) (18,075)
Sell Australian dollar Call, US dollar Put 0.7481 0.6779 (33,720) (38,967)
Sell Australian dollar Put, US dollar Call 0.6804 0.6380 37,119 39,892
Total 45,330 42,958
The net deferred costs and exchange gains and losses on foreign exchange hedges of anticipated foreign currency sales and purchases recognised in
the statement of financial position and the timing of their anticipated recognition as part of sales and purchases are:
Consolidated
Net deferred gains/(losses)
2004 2003
$'000 $'000
Not later than one year (1,655) 2,117
Later than one year but not later than two years 83 –
(1,572) 2,117
The consolidated entity enters into foreign exchange transactions with external counterparties on behalf of AWB (International) Limited. For all
such deals a back to back transaction is entered into with AWB (International) Limited.
The following table sets out the gross value to be settled under foreign currency contracts, the weighted average exchange rates and the settlement
periods of outstanding contracts in the consolidated entity on behalf of AWB (International) Limited. All amounts are stated at the Australian dollar
equivalent.
Consolidated
2004 2003 2004 2003
Forward exchange contracts: Weighted average rate $'000 $'000
Settlement not later than one year
Buy US dollars, Sell Australian dollars – 0.6462 – 160,392
Sell US dollars, Buy Australian dollars 0.6977 0.6404 (1,301,580) (1,639,580)
Buy US dollars, Sell euro 1.2330 1.1254 9,254 349,642
Sell US dollars, Buy euro – 1.1180 – (11,511)
Buy euro, Sell US dollars – 1.1180 – 11,968
Sell euro, Buy US dollars 1.2330 1.1254 (9,306) (361,218)
Total not later than one year (1,301,632) (1,490,307)
Settlement later than one year but not later than two years
Sell US dollars, Buy Australian dollars 0.6809 – (149,856) –
Total later than one year but not later than two years (149,856) –
Total (1,451,488) (1,490,307)
93

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
31. FINANCIAL INSTRUMENTS (continued)
(b) Foreign exchange risk (continued)
Consolidated
Currency options: 2004 2003 2004 2003
Weighted average strike rate $'000 $'000
Not later than one year
Buy Australian dollar Call, US dollar Put 0.7207 0.6560 3,161,616 2,725,635
Buy Australian dollar Put, US dollar Call 0.6813 0.6033 (367,541) (357,344)
Sell Australian dollar Call, US dollar Put 0.7326 0.6663 (710,380) (676,897)
Sell Australian dollar Put, US Dollar Call 0.6723 0.6205 2,949,813 2,550,149
Buy euro Call, US dollar Put – 1.0278 – 113,935
Buy euro dollar Put, US dollar Call – 1.0850 – (34,396)
Sell euro dollar Call, US dollar Put – 1.1403 – (77,675)
Total 5,033,508 4,243,407
(c) Commodity price risk
The consolidated entity enters into commodity futures contracts and options in accordance with board approved limits for the following purposes:
– to hedge (or hedge a proportion) of commodity selling prices on anticipated specific future sales and purchases of agricultural products. Major sales
and purchases being hedged include wheat, sorghum and canola; and
– for trading purposes.
At year end, the consolidated entity has the following commodity futures:
Consolidated
2004 2003 2004 2003
Commodity futures AUD per tonne tonnes tonnes
Not later than one year
Buy futures – USD 178.35 186.30 819,281 612,894
Buy futures – CAD 337.77 398.05 2,500 29,300
Sell futures – USD 171.14 222.76 (904,352) (796,871)
Sell futures – CAD 337.77 397.26 (89,700) (34,580)
Later than one year but not later than two years
Buy futures – CAD 354.04 – 4,300 –
Sell futures – CAD 354.04 – (17,500) –
Total (185,471) (189,257)
Consolidated
2004 2003 2004 2003
delta (i) delta (i)
Commodity options AUD per tonne tonnes tonnes
Not later than one year
Buy Call option 191.10 209.54 48,828 607,189
Sell Call option 184.15 201.78 (44,159) (339,024)
Buy Put option 166.55 175.28 (364,343) (297,011)
Sell Put option 170.60 182.67 529,044 424,991
Total 169,370 396,145
(i) Delta ia a measure of an option’s sensitivity to changes in the price of an underlying asset.
94

31. FINANCIAL INSTRUMENTS (continued)
(c) Commodity price risk (continued)
The net deferred costs and gains and losses on commodity hedges of anticipated sales and purchases recognised in the statement of financial position
and the timing of their anticipated recognition as part of sales and purchases are:
Consolidated
Net deferred gains/(losses)
2004 2003
$'000 $'000
Not later than one year 3,256 1,567
Later than one year but not later than two years 84 –
3,340 1,567
The consolidated entity enters into commodity transactions with external counterparties on behalf of AWB (International) Limited. These
transactions are then passed on to AWB (International) Limited via a commodity contract.
At year end, the consolidated entity has the following commodity futures and options on behalf of AWB (International) Limited:
Consolidated
2004 2003 2004 2003
Commodity futures AUD per tonne tonnes tonnes
Not later than one year
Buy futures 170.56 196.04 892,806 526,349
Sell futures 170.46 195.24 (2,325,840) (693,180)
Total (1,433,034) (166,831)
Commodity options
Not later than one year
Buy Call option 177.23 201.31 670,999 1,339,685
Sell Call option 188.97 202.14 (411,635) (221,943)
Buy Put option 186.95 180.56 (851,846) (1,087,669)
Sell Put option 167.55 184.17 234,734 1,100,188
Total (357,748) 1,130,261
(d) Freight
Consolidated
Forward freight agreements 2004 2003 2004 2003
Weighted average rate per day days days
Buy USD Freight
Not later than one year (31,228) (14,613) 3,465 2,619
Later than one year but not later than two years (30,251) (14,050) 276 853
Later than two years but not later than three years – (12,950) – 122
Sell USD Freight
Not later than one year 31,586 17,149 3,288 1,798
Later than one year but not later than two years 21,581 – 276 –
Later than two years but not later than three years – 16,683 – 366
The marked to market value of forward freight agreements is recognised in the statement of financial performance.
(e) Credit risk exposure
Credit risk reports the loss that would be recognised if counterparties failed to perform as contracted.
Recognised financial instruments
The credit risk on financial assets, excluding investments, of the consolidated entity which have been recognised on the statement of financial
position, is the carrying amount net of any provision for doubtful debts or counterparty risk.
The consolidated entity minimises concentration of credit risk by undertaking transactions with a large number of customers and obtaining credit
insurance for certain customers.
95

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
31. FINANCIAL INSTRUMENTS (continued)
(e) Credit risk exposure (continued)
Under the terms of the grower loan contracts, any distributions from the AWB National Pools are applied as repayments of the outstanding loan
balance. The loans are advanced on a non–recourse basis; any shortfall on repayment is underwritten by AWB Harvest Finance Limited.
Unrecognised financial instruments
Credit risk on derivative contracts which have not been recognised on the statement of financial position is minimised as counterparties are
recognised financial intermediaries with acceptable credit ratings.
(f ) Net fair values
Recognised financial instruments
The carrying amounts and net fair values of financial assets and financial liabilities, at balance date are as follows:
Carrying amount
Net fair value
2004 2003 2004 2003
$'000 $'000 $'000 $'000
Financial assets
Cash assets 48,225 54,785 48,225 54,785
Receivables 1,714,611 1,006,482 1,714,611 1,006,482
Short-term deposits 515,829 36,005 515,829 36,005
Financial assets – other 213,060 101,888 213,060 101,888
Shares 144,571 138,066 190,986 138,066
Total financial assets 2,636,296 1,337,226 2,682,711 1,337,226
Financial liabilities
Payables 533,927 356,615 533,927 356,615
Borrowings 1,902,106 1,062,884 1,902,106 1,062,884
Financial liabilities – other 141,066 66,800 141,066 66,800
Unearned income 2,611 9,458 2,611 9,458
Net deferred gains and losses 1,767 3,684 1,767 3,684
Total financial liabilities 2,581,477 1,499,441 2,581,477 1,499,441
Unrecognised financial instruments
The net fair values of financial instruments not recognised in the statement of financial position held as at the reporting date are:
Consolidated
2004 2003
$'000 $'000
Interest rate swaps 154 (905)
Interest rate options 55 151
Interest rate futures 8 –
217 (754)
Interest rate futures and exchange traded options: The net fair value for interest rate futures and exchange traded options is calculated as the value of
the variation margin on the last business day of the period.
Interest rate swaps, over the counter options and forward rate agreements: The net fair value of these instruments represents the value that would be
obtained in a liquid market if these positions were liquidated.
96

32. DEED OF CROSS GUARANTEE
Pursuant to ASIC Class Order 98/1418 (as amended) dated August 1998, the following wholly owned subsidiaries are relieved from the
Corporations Act 2001 requirements for preparation, audit, and lodgement of financial reports and directors’ report: AWB Finance Limited, AWB
(Australia) Limited, AWB GrainFlow Pty Ltd (formerly AWB Grain Centres Pty Ltd), AWB Investments Limited, Landmark Rural Holdings
Limited, Johnstone River Transport Pty Ltd, Landmark (Qld) Limited and IAMA Agribusiness Pty Ltd.
It is a condition of the Class Order that AWB Limited and each of the subsidiaries enter into a Deed of Cross Guarantee. The effect of the Deed is
that AWB Limited guarantees to pay any deficiency in the event of winding up any of the wholly owned subsidiaries listed below.
The subsidiaries that are parties to the Deed are:
AWB Finance Limited
AWB (Australia) Limited
AWB GrainFlow Pty Limited (formerly AWB Grain Centres Pty Limited)
AWB Investments Limited
Landmark Rural Holdings Limited
Johnstone River Transport Pty Limited
Landmark Operations Limited
Landmark (Qld) Limited
IAMA Agribusiness Pty Limited
A consolidated summarised statement of financial performance and a consolidated statement of financial position, comprising AWB Limited and
controlled entities which are parties to the Deed after eliminating all transactions between parties to the Deed of Cross Guarantee, are set out below.
Summarised statement of financial performance
Consolidated
2004 2003
$'000 $'000
Profit from ordinary activities before income tax expense 75,668 51,377
Income tax expense relating to ordinary activities (25,848) (11,432)
Net profit from ordinary activities after income tax expense 49,820 39,945
Retained profits at the beginning of the year 70,215 68,639
Dividends recognised during the year (83,292) (38,369)
Retained profits at the end of the year 36,743 70,215
Statement of financial position
Current assets
Cash assets 16,860 2,337
Receivables 945,434 631,273
Inventories 179,517 62,111
Other financial assets 37,702 104,978
Current tax assets – 19,562
Other assets 6,374 767
Total current assets 1,185,887 821,028
Non–current assets
Receivables 176,223 54,711
Investments accounted for using the equity method 14,879 10,307
Other financial assets 198,973 862,734
Intangible assets 514,941 172
Property, plant and equipment 254,776 210,514
Deferred tax assets 32,293 26,501
Total non–current assets 1,192,085 1,164,939
Total assets 2,377,972 1,985,967
Current liabilities
Payables 261,077 132,977
Interest bearing liabilities 1,002,091 863,437
Current tax liabilities 13,151 –
Provisions 41,381 16,198
Other liabilities 51,085 39,255
Total current liabilities 1,368,785 1,051,867
97

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
32. DEED OF CROSS GUARANTEE (continued)
Consolidated
2004 2003
$'000 $'000
Non–current liabilities
Interest bearing liabilities 1,131 –
Provisions 2,738 1,721
Deferred tax liabilities 8,810 6,329
Total non–current liabilities 12,679 8,050
Total liabilities 1,381,464 1,059,917
Net assets 996,508 926,050
Equity
Contributed equity 953,403 848,958
Reserves 6,362 6,877
Retained profits 36,743 70,215
Total equity 996,508 926,050
33. CONTROLLED ENTITIES
Percentage of equity interest held
by the consolidated entity
2004 2003
(a) Particulars in relation to controlled entities % %
Name
Country of incorporation
Parent
AWB Limited
Australia
Controlled entities
ACN 005 144 445 Pty Limited Australia 100 100
ACN 053 109 069 (formerly Farmland Pty Limited) Australia 100 100
ACN 089 443 407 Pty Limited Australia 100 100
Agrifood Technology Pty Limited Australia 100 100
Aussigold Produce Pty Limited Australia 100 100
Australian Seed Inoculants Pty Limited Australia 100 100
Australian Wheat Board Pty Limited Australia 100 100
AWB (Australia) Limited Australia 100 100
AWB (Geneva) SA Switzerland 100 100
AWB (International) Limited Australia 100 100
AWB (USA) Limited USA 100 100
AWB Asia Limited Hong Kong 100 100
AWB Commercial Funding Limited Australia 100 100
AWB Custodians Pty Limited Australia 100 100
AWB Finance Limited Australia 100 100
AWB GrainFlow Pty Limited Australia 100 100
AWB Harvest Finance Limited Australia 100 100
AWB Investments Limited Australia 100 100
AWB Japan Pty Limited Australia 100 100
AWB MPT Pty Limited Australia 100 100
AWB Plant Breeding Pty Limited Australia 100 100
AWB Research Pty Limited Australia 100 100
AWB RiskAssist Limited Australia 100 100
AWB Services Limited Australia 100 100
AWB–Zen–noh Limited Japan 51 51
Barrobook Pty Limited Australia 100 100
Big N Distributors Pty Limited Australia 100 100
Bushridge Pty Limited Australia 100 100
Ceres Risk & Insurance Solutions Pty Limited New Zealand 100 –
Dairy Rural Pty Limited Australia 100 100
Farmland Pty Limited (formerly Berriwillock Nominees Pty Limited) Australia 100 100
Frank Sauer and Sons Pty Limited Australia 100 100
98

33. CONTROLLED ENTITIES (continued)
(a) Particulars in relation to controlled entities (continued)
Name
Controlled entities
Franklin Smith IAMA Pty Limited
Glencoe Distributors Pty Limited
Goldref Pty Limited
IAMA (Qld) Pty Limited
IAMA (SA) Pty Limited
IAMA Agribusiness Pty Limited
IAMA Insurance Brokers Holdings Pty Limited
IAMA Insurance Brokers Pty Limited
IAMA Irritech Pty Limited
IAMA Superannuation Fund Pty Limited
ISP Nominees Pty Limited
J O'Malley & Co Pty Limited
Johnstone River Transport Pty Limited
Kerin Lange Rural Pty Limited
Landmark (Qld) Limited
Landmark Holdings (Vic) Pty Limited
Landmark Operations Limited
Landmark Realty (Qld) Pty Limited
Landmark Realty (Tas) Pty Limited (formerly Rangal Holdings Pty Limited)
Landmark Realty (WA) Pty Limited
Landmark Risk Management Pty Limited
Landmark Rural Holdings Limited
Landmark Tenderland Pty Limited
Landmark Wool Pty Limited
Langes Agribusiness Pty Limited
Laxstone Pty Limited
Lenmost Pty Limited
Macquarie Valley Distributors Pty Limited
Mallee Chemicals Pty Limited
North Central Nominees Pty Limited
O'Malley Distribution Group Pty Limited
Presoval Pty Limited
RVL Distribution Pty Limited
Riverland IAMA Pty Limited
SBS IAMA Real Estate Pty Limited
Seed & Grain Sales Pty Limited
Seedtech Pty Limited
Vivco Rural Supplies Pty Limited
Wimmal Distributors Pty Limited
Percentage of equity interest held
by the consolidated entity
2004 2003
% %
Country of incorporation
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 50 50
Australia 100 100
Australia 100 –
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 100 100
Australia 56 56
Australia 100 100
Australia 100 100
99

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
33. CONTROLLED ENTITIES (continued)
(b) Acquisition of controlled entities
On 29 August 2003, the consolidated entity purchased 100% of Landmark Rural Holdings Limited and Johnstone River Transport Pty Limited, and
the operating result of these entities was included in the consolidated operating profit from that date. Details of the acquisitions are as follows:
Consolidated
AWB Limited
2004 2003 2004 2003
$'000 $'000 $'000 $'000
Consideration – 718,400 – –
Associated costs of acquisition – 11,660 – –
– 730,060 – –
Less: – third instalment payable after balance date – (38,400) – –
– cash acquired in Landmark – (148,895) – –
Outflow of cash – 542,765 – –
Fair value of net assets of entity acquired:
Cash assets – 148,895 – –
Receivables – 281,664 – –
Inventories – 120,975 – –
Other assets – 2,738 – –
Investments accounted for using the equity method – 2,134 – –
Other financial assets – 1,048 – –
Intangible assets – 156 – –
Property, plant and equipment – 121,939 – –
Future income tax benefit – 13,327 – –
Payables – (166,272) – –
Interest bearing deposits – (281,613) – –
Current tax liabilities – (2,652) – –
Provisions – (29,482) – –
Provision for restructure – (5,317) – –
Other liabilities – (8,954) – –
Deferred tax liabilities – (2,801) – –
Outside equity interests at acquisition – (1,383) – –
– 194,402 – –
Goodwill on acquisition – 535,658 – –
Consideration (including associated costs) – 730,060 – –
The third instalment of $38.4 million was paid in the 2004 financial year and a receipt $16.8 million was received for a net tangible asset price
adjustment. Additional associated costs amounting to $0.46 million were incurred.
34. EARNINGS PER SHARE
Consolidated
2004 2003
Basic earnings per share (cents) 28.8 15.9
Diluted earnings per share (cents) 28.8 15.9
Reconciliation of earnings used in calculating earnings per share:
$'000
$'000
Net profit from ordinary activities after income tax expense 97,651 44,150
Net profit attributable to outside equity interests (789) (259)
96,862 43,891
Number Number
Weighted average number of ordinary shares used in calculating basic earnings per share 335,925,956 276,470,797
Effect of dilutive securities – performance rights 300,153 258,306
Weighted average number of ordinary shares used in calculating dilutive earnings per share 336,226,109 276,729,103
100

35. SUBSEQUENT EVENTS
(a) 2004
There are no subsequent events which are likely to have a material effect
on the consolidated entity's financial statements. For dividends declared
after 30 September 2004, see Note 22.
(b) 2003
There were no subsequent events which were likely to have a material
effect on the consolidated entity's financial statements. For dividends
declared after 30 September 2003, see Note 22.
36. DISCLOSING THE IMPACT OF ADOPTING AASB EQUIVALENTS TO INTERNATIONAL FINANCIAL
REPORTING STANDARDS (A-IFRS)
The consolidated financial statements of the AWB Group are prepared
in accordance with the summary of significant accounting policies at
Note 1. The Australian Accounting Standards Board (AASB) is adopting
Australian equivalents to International Financial Reporting Standards
(A–IFRS) for application to reporting periods beginning on or after 1
January 2005. The adoption of A–IFRS will be first reflected in the
consolidated entity's financial statements for the half year ending 31
March 2006 and the year ending 30 September 2006.
Entities complying with A–IFRS for the first time will be required to
restate their comparative financial statements to amounts reflecting the
application of A–IFRS to that comparative period. Adjustments required
on transition to A–IFRS are likely to be made, retrospectively, against
opening retained earnings as at 1 October 2004. Additionally, certain
assets and liabilities may not qualify for recognition under A–IFRS, and
will need to be derecognised whereas other asset and liabilities not
previously recognised may need to be recognised under A–IFRS. As a
result, the statement of financial position presented at 30 September
2005 may not equate to the balances presented as comparative numbers
in the 30 September 2006 financial report.
AWB has commenced a review and amendment of its accounting
policies and financial reporting from current Australian Standards to
A–IFRS. The company engaged Deloitte Touche Tohmatsu (Deloitte) to
conduct an impact study to assist in identifying the key areas that will be
impacted by the transition to A–IFRS. This A–IFRS impact study has
formed the basis of structuring an A–IFRS implementation project
within AWB with which Deloitte is continuing to assist.
The release of the A–IFRS and the structuring of an A–IFRS
implementation project have enabled information to be gathered on the
impact on accounting systems, future results, accounting policies and
procedures. The A–IFRS implementation is currently on schedule with
progress reported periodically to meetings of the Audit Committee.
The following are explanations of expected major changes in accounting
policies. There is no reliably estimable quantitative information relevant
to assessing the expected future impacts on the consolidated entity's
reported financial position and future financial performance resulting
from the adoption of A–IFRS.
(a) Share based payments
Under AASB 2, the consolidated entity will be required to recognise an
expense in the Statement of Financial Performance for the fair value of
equity based remuneration granted to employees after 7 November 2002
which has not vested as at 1 January 2005. On the initial adoption of
A–IFRS, the consolidated entity will be required to adjust opening
retained earnings at 1 October 2004 and 30 September 2005
comparative financial data for that portion of the fair value of those
share based payments granted after 7 November 2002 which vest after 1
January 2005 that would have been expensed under AASB 2.
Employee Share Plan
The value of the shares issued, as determined by the fair value on the
date of issue, must be recognised as an employee benefits expense with a
corresponding increase in equity. The consolidated entity's current
policy is not to recognise any amounts in respect of the issue of these
shares.
Performance Rights Plan
The fair value of performance rights issued in December 2002 (effective
date: 1 October 2002), March 2004 (effective date: 1 October 2003)
and any future grants will be recognised as an employee benefits expense
over the expected vesting period with a corresponding increase in equity.
The consolidated entity's current policy is not to recognise any amounts
in respect of the issue of these rights.
Equity Share Plan
The value of the shares issued, as determined by market value on the
date of issue, will be recognised as an employee benefits expense with a
corresponding increase in equity. The consolidated entity's current
policy is not to recognise any amounts in respect of the issue of these
shares.
Reliable estimation of the future financial impacts of these changes in
accounting policies is impracticable because the details of future share
based remuneration and the conditions under which fair value will be
determined are not yet known.
(b) Goodwill
Under AASB 3 Business Combinations, goodwill will no longer be able
to be amortised but instead will be subject to annual impairment testing.
This will result in a change in the consolidated entity’s current
accounting policy which amortises goodwill over 20 years or the
expected useful life. Under the new policy, amortisation will no longer
be charged, but goodwill will be written down to the extent it is
impaired. Reliable estimation of the future financial effects of this
change in accounting policy is impracticable because the conditions
under which impairment will be assessed are not yet known.
(c) Impairment of Assets
Under AASB 136 Impairment of Assets, the recoverable amount of an
asset is determined as the higher of fair value and value in use. This will
result in a change in the consolidated entity’s current accounting policy
which determines the recoverable amount of an asset. Under A–IFRS,
impairment of assets may be recognised sooner and the amount of
write–downs may be greater. Reliable estimation of the future financial
effects of this change in accounting policy is impracticable because the
conditions under which impairment will be assessed are not yet known.
101

NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS
FOR THE YEAR ENDED 30 SEPTEMBER 2004
36. DISCLOSING THE IMPACT OF ADOPTING AASB EQUIVALENTS TO INTERNATIONAL FINANCIAL
REPORTING STANDARDS (A-IFRS) (continued)
(d) Inventories
AASB 102 Inventories will not be applicable to the measurement of
inventories held by commodity broker–traders who acquire inventories
principally with the purpose of selling in the near future and generating
a profit from fluctuations in price or broker–traders' margin. The
inventories of commodity broker–traders will be able to be measured at
fair value less costs to sell with changes in fair value less costs to sell
recognised in the statement of financial performance.
AWB grain acquisition and trading activities are conducted as a
commodity broker–trader. The consolidated entity's current policy is to
recognise grain acquisition and trading inventories at the lower of cost or
net realisable value. Reliable estimation of the future financial impact is
impracticable because the scale of future inventories and the conditions
under which their fair value will be assessed are not yet known.
(e) Financial instruments: recognition and measurement
Classification of financial instruments
Under AASB 139 Financial Instruments: Recognition and Measurement,
financial instruments will be required to be classified into one of the
following categories which will, in turn, determine the accounting
treatment of the item.
(i) loans and receivables– measured at amortised cost;
(ii) held to maturity – measured at amortised cost;
(iii) held for trading – measured at fair value with fair value changes
charged to net profit or loss;
(iv) available for sale – measured at fair value with fair value changes
taken to equity; and
(v) non–trading liabilities – measured at amortised cost.
This will result in a change in the current accounting policy that does not
classify financial instruments in this prescribed manner. In addition, the
fair value of certain derivative financial instruments is separately disclosed
(refer Note 31 (f ) Financial Instruments) but not recognised the
statement of financial position. The future financial effect of this change
in accounting policy is not yet known as the classification and
measurement process has not yet been fully completed and the conditions
under which gains or losses will be measured are not yet known.
Hedge accounting
Under AASB 139 Financial Instruments: Recognition and Measurement,
in order to achieve a qualifying hedge the consolidated entity is required
to meet the following criteria:
identify the type of hedge – fair value or cash flow;
identify the hedged item or transaction;
identify the nature of the risk being hedged;
identify the hedging instrument;
demonstrate that the hedge has been and will continue to be highly
effective; and
document the hedging relationship, including the risk management
objectives and strategy for undertaking the hedge and how
effectiveness will be tested.
The consolidated entity applies hedge accounting to derivatives entered
into for the purpose of hedging anticipated transactions as outlined at
Note 1(h). These contracts are general hedges and may not be able to be
separately identified and documented in accordance with the
requirements of AASB 139. Where hedge accounting will no longer be
able to be applied, all gains and losses on the contracts will be recognised
in the statement of financial performance. Reliable estimation of the
future financial impact is impracticable because assessment of the impact
of implementing the required documentation changes is yet to be
completed.
(f) Income taxes
Under AASB 112 Income Taxes, the consolidated entity will be required
to use a balance sheet liability method which focuses on the tax effects of
transactions and other events that affect amounts recognised in either
the statement of financial position or a tax–based statement of financial
position. Under current Australian Accounting Standards, income tax
losses can only be brought to account as an asset if they are considered
virtually certain of realisation. AASB 112 requires income tax losses to
be brought to account as an asset if they are probable of realisation.
Probable is defined as more likely than not. It is not expected that there
will be any material impact as a result of adoption of this standard.
102

DIRECTORS' DECLARATION
In accordance with a resolution of the directors of AWB Limited, we state that:
(1) in the opinion of the directors:
(a) the financial statements and notes of the company and of the consolidated entity are in accordance with the Corporations Act 2001, including:
– giving a true and fair view of the company's and consolidated entity's financial position as at 30 September 2004 and of their performance for
the year ended on that date; and
– complying with Accounting Standards and the Corporations Regulations 2001; and
(b) there are reasonable grounds to believe that the company will be able to pay its debts as and when they become due and payable; and
(2) in the opinion of the directors, as at the date of this declaration, there are reasonable grounds to believe that the companies and parent entity
which are party to the Deed of Cross Guarantee identified in Note 32 will be able to meet any obligations or liabilities to which they are or may
become subject, by virtue of the Deed of Cross Guarantee.
This declaration is made in accordance with a resolution of the directors on behalf of the board.
Brendan Stewart
Chairman
Sydney
24 November 2004
Andrew Lindberg
Managing Director
103

INDEPENDENT AUDIT REPORT TO THE MEMBERS OF AWB LIMITED
120 Collins Street
Melbourne VIC 3000
Australia
Tel 61 3 9288 8000
Fax 61 3 9654 6166
DX 293 Melbourne
GPO Box 67
Melbourne VIC 3001
Scope
The financial report and directors’ responsibility
The financial report comprises the statement of financial position, statement of financial performance, statement of cash flows, accompanying notes
to the financial statements, and the directors’ declaration for AWB Limited (the company) and the consolidated entity, for the year ended 30
September 2004. The consolidated entity comprises both the company and the entities it controlled during that year.
The directors of the company are responsible for preparing a financial report that gives a true and fair view of the financial position and performance
of the company and the consolidated entity, and that complies with Accounting Standards in Australia, in accordance with the Corporations Act
2001. This includes responsibility 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 report.
Audit approach
We conducted an independent audit of the financial report in order to express an opinion on it to the members of the company. Our audit was
conducted in accordance with Australian Auditing Standards, in order to provide reasonable assurance as to whether the financial report is 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.
We performed procedures to assess whether in all material respects the financial report presents fairly, in accordance with the Corporations Act 2001,
including compliance with Accounting Standards in Australia, and other mandatory financial reporting requirements in Australia, a view which is
consistent with our understanding of the company’s and the consolidated entity’s financial position, and of their performance as represented by the
results of their operations and cash flows.
We formed our audit opinion 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 report, and
assessing the appropriateness of the accounting policies and disclosures used and the reasonableness of significant accounting estimates made by
the directors.
While we considered the effectiveness of management’s internal controls over financial reporting when determining the nature and extent of our
procedures, our audit was not designed to provide assurance on internal controls.
We performed procedures to assess whether the substance of business transactions was accurately reflected in the financial report. These and our
other procedures did not include consideration or judgement of the appropriateness or reasonableness of the business plans or strategies adopted by
the directors and management of the company.
Independence
We are independent of the company, and have met the independence requirements of Australian professional ethical pronouncements and the
Corporations Act 2001. In addition to our audit of the financial report, we were engaged to undertake the services disclosed in the notes to the
financial statements. The provision of these services has not impaired our independence.
Audit opinion
In our opinion, the financial report of AWB Limited is in accordance with:
(a) the Corporations Act 2001, including:
(i) giving a true and fair view of the financial position of AWB Limited and the consolidated entity at 30 September 2004 and of their
performance for the year ended on that date; and
(ii) complying with Accounting Standards in Australia and the Corporations Regulations 2001; and
(b) other mandatory financial reporting requirements in Australia.
Ernst & Young
Melbourne
24 November 2004
I H Miller
Partner
Liability limited by the Accountants Scheme, approved under the Professional Standards Act 1994 (NSW).
104

ASX ADDITIONAL INFORMATION
SHAREHOLDER INFORMATION
Additional information required by the Australian Stock Exchange and not shown elsewhere in this report is as follows. The information is current
as at 14 December 2004.
a) Distribution of equity securities
The number of shareholders, by size of holding, in each class of share are:
Ordinary shares
Number of holders
Number of shares
1 – 1,000 26,601 9,893,291
1,001 – 5,000 24,313 61,688,838
5,001 – 10,000 7,695 54,412,152
10,001 – 100,000 6,086 119,975,284
100,001 and over 85 96,073,353
64,780 342,042,918
The number of shareholders holding less than a marketable parcel of shares are: 7,027 401,077
b) Twenty largest shareholders
The names of the twenty largest holders of quoted shares are:
Listed ordinary shares
Number of shares
Percentage of
ordinary shares
1 J P Morgan Nominees Australia Limited 17,087,881 5.00%
2 National Nominees Limited 15,798,749 4.62%
3 Westpac Custodian Nominees Limited 10,521,972 3.08%
4 Citicorp Nominees Pty Limited 8,180,902 2.39%
5 RBC Global Services Australia Nominees Pty Limited 5,337,601 1.56%
6 J P Morgan Nominees Australia Limited 2,336,531 0.68%
7 HSBC Custody Nominees (Australia) Limited 2,131,827 0.62%
8 Westpac Financial Services Limited 2,105,400 0.62%
9 CPU Share Plans Pty Limited 1,962,724 0.57%
10 RBC Global Services Australia Nominees Pty Limited 1,915,174 0.56%
11 Bond Street Custodians Limited 1,733,281 0.51%
12 Citicorp Nominees Pty Limited 1,427,343 0.42%
13 AMP Life Limited 1,356,857 0.40%
14 ANZ Nominees Limited 1,280,698 0.37%
15 Citicorp Nominees Pty Limited 1,190,218 0.35%
16 Bond Street Custodians Limited 1,150,584 0.34%
17 Citicorp Nominees Pty Limited 1,092,318 0.32%
18 Pan Australian Nominees Pty Limited 1,054,024 0.31%
19 Citicorp Nominees Pty Limited 946,895 0.28%
20 Queensland Investment Corporation 657,258 0.19%
c) Substantial shareholders
79,268,237 23.17%
The only substantial shareholder as at 14 December 2004 was J P Morgan Nominees Australia Limited with 17,087,881 AWB B class shares
representing 5.00% of issued capital.
105

SHAREHOLDER COMMUNICATION
FINANCIAL CALENDAR – 2005
Annual General Meeting
Half year end
Half year results and interim dividend announced
Full year end
Full year results and final dividend announced
DUAL CLASS SHARE STRUCTURE
AWB Limited has two classes of shares:
10 Mar
31 Mar
25 May
30 Sep
30 Nov
A class shares – can only be issued to current wheat growers (that meet
the definition of a grower in the constitution). These cannot be
transferred and must be redeemed when the A class shareholder ceases
to be a wheat grower. A class shares are not entitled to receive any
dividends; however, they do carry other important rights giving A class
shareholders control of AWB, including giving A class shareholders the
ability to elect a majority of the board of directors; and
B class shares – the only class of shares that are quoted on the
Australian Stock Exchange (ASX). B class shares carry rights to receive
dividends and the right to elect a minority of the board of directors.
They can be freely traded between wheat growers and non growers,
subject to no shareholder owning more than 10% of the B class shares
on issue.
VOTING RIGHTS
The voting rights for holders of each AWB share class are as follows:
A class shares – on a show of hands, the holder of an A class share has
one vote and on a poll the holder has the number of votes determined
by their annual grown and harvested wheat tonnage deliveries as follows:
one vote; plus
an additional vote if their average annual tonnage of wheat delivered
to the AWB Group is more than 33 1/3 tonnes per year for the three
years ending at the prior financial year; plus
an additional vote for each 500 tonnes, or part thereof, per year of
average annual tonnage delivered by the A class shareholder to the
AWB Group above 500 tonnes per year for the three years ending at
the prior financial year.
At 30 September 2004, there were 28,596 A class shares.
B class shares – on a show of hands, the holder of a B class share has
one vote and on a poll the holder has one vote for each B class
share held.
At 30 September 2004, there were 64,339 B class shareholders.
ANNUAL GENERAL MEETING
AWB’s Annual General Meeting will be held at 12 noon (Melbourne
time) on Thursday 10 March 2005 at the La Trobe Theatre, Level 2,
Melbourne Convention Centre, Cnr Spencer and Flinders Streets,
Melbourne, Victoria. Details of the business of the meeting are
contained in the separate Notice of Meetings sent to shareholders.
DIVIDEND PAYMENT
A final, fully franked dividend of 11 cents per share was paid on 17
December 2004 to B class shareholders registered on the AWB share
register at 3 December 2004. For Australian tax purposes, the dividend
was fully franked at the company tax rate of 30%.
AWB continues to offer a Dividend Reinvestment Plan (DRP). Eligible
shareholders can have all or part of the dividend reinvested in additional
shares. Participation is entirely voluntary. Further details on the terms
and conditions of the DRP can be found on AWB’s website at
www.awb.com.au or by contacting the company’s share registry.
STOCK EXCHANGE LISTING
AWB B class shares are listed on the ASX and reported in the industrial
section of daily newspapers under the code AWB.
SHARE REGISTRY
Computershare Investor Services Pty Ltd
PO Box 14061 Melbourne City MC VIC 8001
Tel: 1800 810 032
Fax: 1800 800 053
Please quote your current address together with your Securityholder
Reference Number (SRN) or Holder Identification Number (HIN) as
shown on your issuer sponsored / CHESS statements.
CHANGE OF ADDRESS OR BANKING DETAILS
Shareholders should notify the share registry in writing immediately of
changes of address, or banking details for dividends electronically
credited to a bank account.
REMOVAL FROM ANNUAL REPORT MAILING LIST
Shareholders who no longer want to receive the annual report should
call the AWB share registry on 1800 810 032 to register their choice.
Shareholders will continue to receive all other information including the
notice of the annual general meeting and proxy form. The annual report
can also be viewed on AWB’s website at www.awb.com.au.
INVESTOR RELATIONS
Investors with questions regarding AWB financial information are
invited to contact:
Investor Relations
AWB Limited
380 La Trobe Street
Melbourne VIC 3000
Tel: 03 9209 2000
106

MAJOR ANNOUNCEMENTS TO THE AUSTRALIAN STOCK EXCHANGE
2003
1 October 2003
AWB announces structural changes to ring fence its wheat export related
operations, which will improve and protect the credit rating for AWB
Harvest Finance Limited in providing finance to growers who deliver to
the National Pool.
9 October 2003
AWB announces its third distribution from the No.1 2002 AWB
National Pool, distributing more than $311 million to Australian wheat
growers.
20 October 2003
AWB announces that it raised $43.8 million through its Share Purchase
Plan which was offered to eligible shareholders in connection with the
acquisition of Landmark.
30 October 2003
AWB offers B class shareholders the opportunity to participate in its
Dividend Reinvestment Plan.
26 November 2003
AWB announces an after tax profit of $43.9 million for the 12 months
ended 30 September 2003, and declares a final dividend of 11 cents per
B class share.
2004
13 January 2004
AWB announces its fourth distribution from the No. 1 2002 AWB
National Pool, distributing more than $393 million to Australian wheat
growers.
19 January 2004
Andrew Lindberg, Managing Director, is reappointed until September
2008.
9 February 2004
AWB lifts its 2003/04 crop forecast to approximately 25 million tonnes.
11 March 2004
Steve Chamarette is elected as a director of AWB Limited, and Robert
Barry is re-elected.
29 March 2004
AWB finalises 2002/03 AWB National Pools, with Australian wheat
growers receiving their fifth and final distribution. The total pool equity
from the drought-affected pool was $1.3 billion.
8 April 2004
AWB announces its first distribution payment from the 2003/04 AWB
National Pool, the largest first distribution ever made to Australian
wheat growers of $970 million.
10 May 2004
AWB signs a Heads of Agreement with the Egyptian Government to
establish a framework to explore a number of mutually beneficial
opportunities to both parties.
26 May 2004
AWB reports an after tax profit of $54.1 million for the half year ended
31 March 2004, and declares an interim dividend of 14 cents per share.
28 June 2004
AWB and GrainCorp Limited announce the creation of a joint venture
company to better manage the logistics of grain exports on the east coast
of Australia.
5 July 2004
AWB announces a second distribution of $975 million from the
2003/04 AWB National Pool to Australian wheat growers.
107

GLOSSARY
AWB Basis Pool
AWB Basis Pool is a multi-varietal pool contract. It takes advantage of the professionally managed “basis” premium achieved in the AWB National
Pool and provides growers with an opportunity to establish specific international wheat prices using the Chicago Board of Trade wheat futures
contracts and prevailing foreign exchange rates.
AWB Group
AWB Limited and its controlled entities.
AWB RiskAssist
AWB RiskAssist is a specialised risk management business service designed to help growers manage commodity futures and foreign exchange hedging
with an AWB Basis Pool contract.
Golden Rewards
AWB Golden Rewards is a comprehensive payment and binning system for wheat marketed through the AWB National Pool and selected cash
options. Golden Rewards is designed to provide pricing accuracy and market signals for Australia’s grain growers, ensuring that growers are rewarded
for delivering the types of wheat demanded by AWB’s international customers. Growers have better defined financial targets to aim for in terms of
higher protein content and lower screenings levels, and are no longer severely penalised if their wheat narrowly misses a minimum binning standard
for one of these quality attributes.
Gross Pool Value
Gross Pool Value (GPV) is the sum of all export revenue and other value added by AWB. It represents the gross return to growers, and equates to the
sum of pool returns prior to storage, handling, rail and fobbing deductions.
Gross Written Premium
Gross Written Premium (GWP) is the combined total of all base premiums from all insurance policies written in a book of insurance business over a
defined period of time. Base premium is equal to the total premium charged for an insurance policy, less GST and government charges (i.e. stamp
duty and fire service levy, if applicable). It is on the base premiums that commission is calculated, culminating in the Gross Profit earned by AWB
Landmark over a defined period of time.
Value at Risk
Value at Risk (VaR) measures the worst expected loss that the company can suffer over a given time interval under normal market conditions at a
given confidence level. It assesses this risk by using statistical and simulation models designed to capture the volatility of positions held within the
trading portfolio.
VaR on a single position is calculated using the following inputs:
The size of the position;
The volatility of the market in which that position is held; and
The period of time for which the position will be held
Wheat Industry Benchmark
The Wheat Industry Benchmark (WIB) is a comprehensive, rigorous benchmark that objectively measures the performance of the AWB National
Pool. The WIB incorporates fundamental pricing principles and acts as a competing manager under prescribed AWBI Board policies and
procedures. It assesses the primary revenues, costs and risk parameters that impact the AWB National Pool value and ultimate returns. It effectively
replicates the pool model, in managing wheat exports with prescribed physical and risk management constraints, to achieve a benchmark pool value.
108

National and
International Presence
AWB/Landmark national locations
ROYCE DESIGN AWB 5474
109

Head Office
380 La Trobe Street
Melbourne, Victoria 3000
Tel: (03) 9209 2000
1800 054 333 (Toll Free)
Fax: (03) 9670 2782
Web: www.awb.com.au
ABN: 99 081 890 459
110