110th ANNUAL REPORT - KU Children's Services

Our Mission StatementKU Children’s Services is a dynamic and progressive organisation whosemission is to provide a range of high quality educational programs for childrenand families in accordance with its commitment to the rights of children and theprinciples of social justice.In meeting this mission statement KU will:• Provide a range of children’s services which demonstratestandards of excellence.• Promote the importance of high quality broadly basedprograms for children, families and communities.• Have a positive influence on policies and practices which havea direct impact on young children and their families.• Encourage, assist or maintain children’s services in areas ofdemonstrated need.• Promote positive partnerships with families.• Embrace diversity and respond to changing individual, familyand community needs.• Strive for cost-effective methods of service delivery.• Develop resources for children, families and staff within theorganisation and to share these in the wider community.• Create an environment, which supports the motivationand commitment of staff and fosters their professionaldevelopment.• Promote and participate in research projects in order toimprove outcomes for children and their families.Enriching Children’s LivesFront cover: KU’s new centre masthead image - children from KU Phillip Park CCC, KU Killara Park Pre-school and The Joey Club.

PRESIDENT’S REPORTPenny Le CouteurPresident, Board of Directors“KU Board is delighted tohear stories from familiesabout the impact madeby their child’s attendanceat a KU centre. Familiesalso praise our centreand service staff for theirdedication and love ofworking with children. Wecontinue to try to expandthe number of familieswho are able to gain thisexperience.”KU celebrated its hundred and tenthanniversary during Children’s Weekin October 2005. All centres wereencouraged to celebrate this and usethe opportunity to gain local publicity.There were many happy occasionsand some are depicted in this annualreport. Some centres (those fundedin 1975 with “Whitlam” dollars) alsocelebrated their thirtieth birthdays.As in many past years, KU experiencedmixed fortunes in 2005. KU won thetenders to supply Inclusion SupportAgencies for seven of the seventeenregions in NSW. This is a newprogram to promote the inclusion ofchildren with additional needs intoFederally-funded services. These areprincipally long day care services,both private and community-based.This means that KU will be providingservices to approximately fifty percent(1,600) of all such services in NSW.This opportunity will expose KU’s name,values and experience in the specialeducation field to a new and widerrange of services. It also enables therestructure of an important part of KU’sservices to the community in the lightof changed funding opportunities. Thestory of our commitment to specialeducation is the feature article in thisAnnual Report.However, we lost our bid to retain thecontract to manage the Departmentof Defence’s child care centres, aswe were not able to comply with thetender conditions.Board ActivitiesThe Board’s focus continued to be onKU’s growth and related marketingstrategies. These were of particularimportance as the long day caresector continued to consolidate, withone provider owning nearly one-thirdof all Australian centres and expandinginto overseas markets.The Marketing Committee drovethe development of a new strapline“enriching children’s lives” and a newand uniform “look” (masthead) for allcentre communications. There was athoughtful debate about how KU shouldmarket itself in order to enhance itsposition as a significant provider andadvocate. The launch of KU’s updatedwebsite and staff Intranet has made asubstantial contribution to enhancedcommunication between servicesand Head Office. It will also enhancefamilies’ understanding of KU’s historyand values.KU’s growth continued to be principallyin the not-for-profit sector, but it wasgratifying to see that some largeemployers, such as Qantas, remainedcommitted to KU as the managerfor their services. A parent seminarat the State Library, featuring DrLouise Porter speaking on managingchildren’s behaviour, was very wellattended. Parent seminars at localvenues did not prove popular.The Board reviewed its direction afterdiscussions with all directors. Thiswas part of an ongoing process toensure that the Board not only fulfilsits statutory obligations, but alsoadds value to the organisation. It alsoregularly monitored the corporateplan and risk management schedules,as well as developing a new monthly“dashboard” of performance indicatorsfor the organisation.KU’s attention to its occupationalhealth and safety obligations bore fruitin reduced workers compensationcosts towards the end of 2005.Regretfully, the Premium DiscountScheme was discontinued withchanges to the Workers Compensationlegislation.The Finance Committee concludedthe process of reviewing KU’s assetmanagers and changes would bemade in 2006. The choice was made4KU’S 110 th ANNUAL REPORT 2005

KU’s 110 years celebration atEmerald Hill Child Care Centrelargely on the basis of improvedadvice and support from the newmanager. KU also reviewed itsinsurance arrangements and decidedthat it was appropriate to stay withits current provider. Preliminarywork commenced in order to ensurethat KU would comply with the newInternational Accounting Standards.Returns on investments were satisfyingfor a second year after a period ofpoor performance. Centres’ resultswere analysed against variousbenchmarks and it was pleasing tosee that, overall, KU’s utilisation andperformance against budget weresatisfactory. Nevertheless, preschoolsand long day care centres inless affluent areas struggled despite adegree of cross-subsidisation.KU pre-schools finally gained approvalfrom the ATO for an over-arching taxdeductiblebuilding fund.The Education Committee, chairedby academic Dr Sue Dockett from theUniversity of Western Sydney, involvedparents and staff in invigoratingdiscussions about matters such as thevalue of a play-based curriculum andportfolio reporting for children.Federal GovernmentAs commented above, KU wonseven regions in NSW as part of theInclusion Support Agency network.Its introduction in April 2006 will seethe end to the former broadbandfunding of special services, andKU’s team which serviced its ownlong day care centres. Child carecontinued to be more prominent onthe political agenda, but attemptsto rationalise the state and federalsubsidies did not bear fruit. KU joinedwith its sister organisations in Victoriaand Queensland in an attempt totry to have a voice with the FederalGovernment about children’s servicesissues in general.NSW Government2005 was the transitional year beforethe new children’s services regulationscame into place. Discussion continuedbetween the NSW Department ofCommunity Services and peakorganisations about funding for preschoolsand the child/staff ratios,particularly for babies. The longawaited new regulations were finallygazetted in late 2004, but without theenhancement of the reduced child:staffratios for babies.A review of the funding in preschoolsfor children with additionalneeds (SCAN) was presented to theMinister, but there have been noannouncements about the program’sfuture. In addition, there was muchwork carried out with various consortiaregarding the NSW Early InterventionProgram, with KU developing fruitfulrelationships with various other not-forprofitorganisations.Local GovernmentParent power again was successfulin ensuring that KU Leichhardt Preschool’slease was renewed for fiveyears with a five-year option. Somecouncils, such as the City of Sydney,North Sydney and Willoughby, weregenerous in their continued supportfor community-based services. TheCity of Sydney introduced a ChildCare Local Environment Plan, wherebylarge commercial developments hadto include a child care centre in orderto rectify unmet demand. This was inresponse to a survey of residents andworkers’ needs in the area. The Citywas also examining tying subsidisedrents to performance in meetingcommunity needs.End of year resultsKU’s accounts show a profit for2005. This is due to a better thanexpected workers compensation claimsexperience in 2004/5 which resultedin a premium adjustment and then alower premium cited for the rest of thatfinancial year. This, in turn, reducedsalary costs to below budgeted levels.ConclusionKU Board is delighted to hear storiesfrom families about the impact madeby their child’s attendance at a KUcentre. Families also praise our centreand service staff for their dedicationand love of working with children. Wecontinue to try to expand the numberof families who are able to gain thisexperience.I would like to thank my fellow Boardmembers for their contributions duringthe year and to Head Office staff whowork behind the scenes to enablecentres to operate at the highestquality possible.Penny Le CouteurPresidentKU’S 110 th ANNUAL REPORT 20055

Antoinette le MarchantChief Executive OfficerHEAD OFFICE AND CENTRE REPORTHead Office staff was focused onensuring compliance with the newNSW regulations due to start atthe beginning of 2006, as well astenders for new business.As our President has noted, KUlost its Defence contract in mid-2005. We were very touched bythe support of staff and familiesthroughout the painful process oftransferring the nineteen services.KU also closed Scotland Islandand Mobile 2 (outer south westof Sydney) pre-schools due topoor utilisation in both areas. Aspart compensation, some newKU programs and centres beganoperating throughout the year. Asignificant win was the gaining ofseven of the eighteen InclusionSupport Agencies in NSW (ISAs).These form part of a new federallyfundedprogram which will assist theinclusion of children with disabilities,principally in long day care services,from 2006.Except for the loss of Defencecentres, growth over the last fewyears has been in all areas, butsignificantly in family programs –see Graph A. This has been largelyby winning competitive tenders fromboth State and Federal governmentdepartments. The most recentof these was Northern SydneySupported Playgroups (a NSWFamilies First initiative). It was alsoparticularly welcome to have variouspre-schools approach KU during theyear to become members. Twowere Greenwich Pre-school andThe Chase Pre-school (Roseville,NSW), which will formally start as KUbranches in 2006. Four pre-schoolsfrom Wagga Wagga will also joinKU later next year, while PeninsulaPre-school (north of Newcastle)and Galston Pre-school transferredearly in the year and Loreto After-School Care in May, Happy KidsJewish Long Day Care Centre inSeptember and Maitland Mobile andOutreach Service in November. KU’scontracts with The Alfred Hospitalin Melbourne and Fairfax in Sydneywere also renewed. A new centrein Bankstown, Playford Park, willalso be completed in the first half of2006. Graph B shows the numberof licensed places by service typeand does not include unlicensedfamily programs.Graph C tracks families usingKU services as well as parentmembership in line with the growthof services mentioned above, whileGraph D shows the staff profile.KU CENTRES, PROJECTSAND PROGRAMSPre-schools remained a large partof KU’s business and an optionthat KU strongly feels should beavailable for all families. MuchGRAPH A Service Types 1990 - 2005GRAPH B Licensed Places 1990 - 2005908070608276813000250026302670274419901994200550200040302630150020100719901115 1614972000 2005101000790650754Pre-schools Long Day Care OtherAMEPFamily ProgramsOther includes out of school hours care, mobile pre-schools and occasional care services.AMEP services are unlicensed. Long Day Care includes community-based and employersponsored services.5000Pre-schools211341Long DayCare3090120Out of SchoolHours Care115185135MobilePre-schools140Work-BasedCentresLong Day Care includes occasional care. All places are licensed except for Out ofSchool Hours Care.6KU’S 110 th ANNUAL REPORT 2005

Celebrating 30 years of KU Lethbridge ParkPre-school with local dignitaries and childrenheightened staff awareness showedcontinuing benefits in reducing childprotection notifications against staff.KU Hebersham Pre-school won a Clubs’grant to have a speech pathologist inthe centre as well as a social worker.The Special Education team wasdelighted that its tender won sevenregions in the Inclusion SupportAgency process. This will enable KU’sexpertise and name to be extendedthroughout NSW.AdvocacyKU’s senior staff, as usual, played asignificant role in promoting children’sinterests and the importance of choiceand quality in services. A list of thevarious committees and forums whereKU was represented follows thisreport. There continued to be frequentliaison with organisations with similarvalues, such as KPV in Victoria andC&K in Queensland, which formed aloose coalition to lobby for pre-schoolfunding.The Manager of Pre-school Servicescontinued as President of NSW branchof Early Childhood Australia. The focusof the NSW Children’s Services Forumremained the long awaited regulations,staffing shortages, promoting preschoolsand funding formulae.Human ResourcesTurnover of centre staff during theyear continued to be 25% as inprevious years. KU, however, ispursuing various ways of makingthe organisation more attractive asan employer. Different staff exitquestionnaires are being explored asis great use of permanent relief staffand different ways of contacting casualstaff. KU continued to be popularwith students doing formal or informalpracticum sessions with services, whileits scholarship scheme also enhancedits image as a preferred employer.Graph D shows the employment trendsat KU. Feedback in exit questionnairesshowed satisfaction with KU withan employer, but some predictabledissatisfaction about pay Increases forteachers occurred during the year, andthe wage case for child care workerscontinued its protracted progress.Centre staff shortages in most areascontinued to be of concern, with a highreliance on temporary and expensivecasual staff. We were pleased,however, that we did not need toseek any exemptions from the NSWRegulations. It was hoped that KU’sconditions and support for staff wouldeventually attract and retain new staff.In the meantime, KU continued itstertiary student scholarship programand also attended various careersmarkets at universities and TAFEcolleges, and increasingly used theInternet as a means of advertising forstaff. Advertising costs declined againin 2005.In 2005, KU was able to reducethe average cost of its workerscompensation claims. In response tothe Board’s concern, much time wastaken in refining OHS procedures inorder to minimise accidents and thecost of return to work plans. The draftOHS document (also known as theSafety Management System) is veryclose to completion.Finance, Head OfficeServices and INFORMATIONTECHNOLOGYKU’s Intranet was launched, whichwas a significant achievement, due tothe creative efforts of KU’s corporatepublications co-ordinator, GosiaConnell. This has proved an invaluabletool for the parent organisation. Mostcentres had a detailed condition reportcarried out in order to assist withplanning upgrades. A large percentageof centres were on EFTPOS and weremoving to be cash-free environments.Office Services ensured that KU’scorporate compliance was smoothlyachieved and KU was delighted at lastto gain one building fund for all of itscommunity-based pre-schools.Thank YouThank you to all the staff of centresand Head Office who make workingfor KU so stimulating. And thank you,too, for the children and their familieswho benefit from KU’s services andprograms.Antoinette le MarchantChief Executive Officer8KU’S 110 th ANNUAL REPORT 2005

ADVOCACY AND FUNDING SOURCESParticipation in EarlyChildhood AND Related Forums• Aboriginal and Torres Strait IslanderEarly Childhood Sector Advisory GroupInc.• Australian Taxation Office’s EducationPartnership• Blue Mountains Consortium• Early Childhood Australia (NSW Branch)- Executive Committee- Finance and Business Committee• Early Childhood Australia (Vic Branch)• Bethany Early Intervention ProgramAdvisory Committee• Early Childhood Intervention Australia(NSW Chapter) Incorporated- Central Committee- Administration and FinanceCommittee- National Committee• Early Childhood InterventionCo-ordination Program Local Area StateCommittees• Early Intervention Program - PeerConsultation Reference Group• Family and Community ServicesCentre Steering Committee• Forum of Learning and Development inChild Protection• Hunter Regional SCAN Reference Group• Kindergartens & (State) ConciliationCommittee• Macarthur Health Service Planning andDevelopment Committee• NSW Children’s Services Forum- Pre-school Working Party- Staff Shortages Working Party• NSW Department of CommunityServices Pre-school Funding ReviewStage 2 and Stage 3• NSW Children’s Services Health andSafety Committee• NSW Department of CommunityServices Bankstown Early InterventionProgram• NSW Department of CommunityServices Interim Policy Advisory Group• NSW Department of CommunityServices Early Intervention Program- External Stakeholders Reference Group• NSW Department of CommunityServices SCAN Evaluation Committee• NSW Department of CommunityServices CALD Project Metro SouthEast Sydney Network• NSW Department of Education andTraining Early Childhood ReferenceGroup• NSW Early Childhood EnvironmentalEducation Network• NSW Early Childhood ProfessionalExperience Council• NSW Government’s Social JusticeReference Group• NSW Ombudsman Investigative Forum• NSW Ombudsman Children’s ServicesForum• Non-Profit Children’s ServicesIncorporated• Northern Sydney Additional NeedsWorking Group• Northern Sydney Supported PlaygroupProject Reference Group• Northern Sydney Supporting Childrenwith Additional Needs (SCAN) AreaReference Group• Paediatric Interagency - Campbelltown• SCAN State Reference Group• SCAN Area Reference Groups (EasternSydney, Inner West, Illawarra, NorthernSydney)• SUPS Sponsor Network• TAFE NSW Children’s Services IndustryReference Group• University of Newcastle ProfessionalEducation Advisory Committee• University of Western SydneyMacarthur - Starting School ProjectAdvisory Committee• University of Western Sydney CourseAdvisory Committee• Waterloo and Redfern CommunityConsultation GroupFinancial Assistance for KUServices and ProjectsKU services and special projects relysubstantially upon financial supportfrom various Commonwealth and StateGovernment Departments. KU alsobenefits from the generosity of its owncentres, from individuals, organisationsand businesses. We would like to thank allthose who help our services and projectsfor children to be of high quality and stillaffordable for children and families.COMMONWEALTHDepartment of Family and CommunityServices• Supplementary Workers Program(consultancy for LDC, OOSH, VacationCare, OCC) and Special NeedsSubsidy Scheme (assistance forchildren with high support needs)• Macarthur Parenting Project• Early Language Literacy Initiative (ELLI)• Various capital grants to KU’scommunity-based long day carecentresAustralian Sports Commission (AASCProgram)• KU Dem School Kids Care - ActiveAfter School Communities grant forstaff to attend the Community CoachTrainingDepartment of Education, Science andTraining• Indigenous Education StrategicInitiative Program (for pre-schools withindigenous children)STATES AND TERRITORIESNew South WalesDepartment of Ageing, Disability andHome Care• Children’s Therapy (SpeechPathology Service, Eastern and InnerCity centres)• KU Starting Points - Macarthur FirstSteps Early Intervention• KU Starting Points - MacarthurStepping Stones (preparation for preschoolgroup)• KU Starting Points - Penrith (EarlyChildhood Early Intervention)Department of Community Services• Advisers’ Project• Funding for pre-schools:- Base Funding- Affordability FundingKU’S 110 th ANNUAL REPORT 20059

ADVOCACY AND FUNDING SOURCES (CONTINUED)- Supporting Children withAdditional Needs (SCAN)Program• Various one-off grants in a number ofKU pre-schools• KU James Cahill Learning Together(Special unit for children with highsupport needs)• KU Macarthur Learning Together(Reverse mainstream program)• Day Care Funding - Illawarra Regionto support individual children withadditional needs in pre-schools• Funding for long day care centres• Northern Sydney SCAN SupportingChildren with Additional Needs• Families First Inner West Play & Chat- Supported Playgroups with theBenevolent Society• Families First Northern SydneySupported Playgroups• Early Intervention Therapeutic ChildCare Places - Bankstown• Families First - Inner Newcastle- Supported Playgroups• South West Sydney ICS SCANPartnership (Consultancy) Support forKU services• KU SCAN - Support Staff forpre-schoolsDepartment of Education and Training• Intervention Support Program: SpecialEducation Support Program• Intervention Support Program: KUStarting Points - Macarthur FirstSteps and Penrith• Intervention Support Program:Capital Funding ComponentNorthern TerritoryDepartment of Health and CommunityServices• Subsidy to each long day care centre- ended June 2005.VictoriaDepartment of Health Services• Alfred Child Care Centre and EmeraldHill Child Care Centre - Pre-schoolFundingCOUNCILSSpecific assistance includes:• Hornsby Council’s Donation Programto KU Grevillea Pre-school (equipmentfor social/emotional development)• Ku-ring-gai Council to:- KU Killara Park Pre-school(purchase of staff room tables/chairs and playroom readingchair)- 2005 Financial AssistanceProgram - KU West PymblePre-school (books in the parentlibrary)- WSN Environmental SolutionsGrassroots Program - KU WestPymble Pre-school (supply andinstallation of a water tank)• Wollongong City Council to:- KU Wombarra and KU BulliPre-schools (contribution forexpenses eg, electricity andground maintenance)- KU Gwynneville and KU CorrimalPre-schools (donation towardsrates)A special thanks to the following councilswhich have also assisted KU centres inthe past year in a variety of ways:• Baulkham Hills Shire Council• Bankstown City Council• Blue Mountains City Council• Campbelltown City Council• Hornsby Shire Council• Ku-ring-gai Council• North Sydney Council• Randwick City Council• Sutherland Shire Council• City of Sydney Council• Warringah Council• Willoughby City CouncilNSW CLUBS• Mt Druitt Workers Club - KUHebersham Pre-school (grant tosupport community workers withresources/trainers/workshops)• St Mary’s Leagues Club - KUHebersham Pre-school (work inpartnership with Mount DruittCommunity Health Centre to accessSpeech Pathologist)• Rooty Hill RSL Club - KU HebershamPre-school (work in partnership withMount Druitt Community Health Centreto access Speech Pathologist)Community Development and SupportExpenditure Scheme (CDSE)Grants under this scheme include:• Kemps Creek Sporting and BowlingClub - Lurnea OOSH (resources andequipment), KU CT Lewis CCC (safetyprogram/resources)OTHER• Chatswood RSL to KU ChatswoodWest Pre-school (grant to purchase ahydraulic change table)• Centennial Park and Moore Park Trustfor their contribution to KU CentennialParklands Children’s Centre• Christie Foundation for theircontribution to KU James CahillPre-school• Lotterywest Board approved a grantof $9,730.60 (inc. GST) to KU for theSunny Centre• Mr John Scott, Director StrategicProject, Premier’s Department($11,000 inc. GST) - Katoomba NorthProject• NSW Department of Sport andRecreation - Chalk the Walk -KU Maybanke Pre-school (donation)• NSW Department of Sports andRecreation - KU Grevillea Pre-school(grant for a special project)• Telstra Foundation to KU SutherlandPre-school (playground upgrade)10KU’S 110 th ANNUAL REPORT 2005

KU Inner West Play and ChatSupported PlaygroupsA HISTORY OF KU’S COMMITMENTTO SPECIAL EDUCATIONThe plight of children of workingmothers, many of whom wereforced to leave their children lockedin houses or roaming the streets,moved Maybanke Anderson, KU’sfounding mother to establish thefirst free kindergarten at a churchhall in Sussex Street in 1895.The social justice roots of theKindergarten Union – now known asKU Children’s Services – have alwaysbeen focused on the importance ofeducating vulnerable children. TheKindergarten Union, in 1897, thenestablished the first training collegefor early childhood teachers calledthe Sydney Kindergarten TeachersCollege. The syllabus was built onFroebel’s principles and the belief inthe ”right of each child to have theopportunity to develop physically,socially, intellectually and emotionallyso that each individual’s innate abilitiesand potential could develop to thefull.” 1 There was also a strong focuson the health and nutrition of childrenattending kindergartens, no doubt inresponse to the poverty of their homeenvironments. The Kindergarten Unionalso had a holiday home in Thirroulwhere groups of children and teacherswent for weeks at a time to enjoy thesea air.Within ten years many womengraduates were working with theincreasing number of kindergartensand, with the Kindergarten Union’sencouragement, also went towork with children in hospitals andcharitable institutions. It was in theseas well as in special schools, that1 P.22, Sydney Kindergarten Teachers College1897 – 1981 by Ruth Harrison, 1985.children with disabilities were placed. Incontrast, in one of our earliest annualreports there is a story about a childwith physical disabilities who attendedour Woolloomooloo centre and howthe service helped him. During the1970s, however, change fortunatelycame and state governments tookon the responsibility for children withdisabilities and established specialeducational units within regular schoolsto enable children with disabilities toattend.This was matched by changes in theearly education field with the NSWGovernment introducing state fundingfor “handicapped and migrant children”in 1979. This funding was directedat pre-schools only, thereby cateringfor children three years and over.The emphasis was on integrationof children with development andlearning disabilities into “normal”experiences. KU benefited from thisfunding and used part of it to appointthe first special education consultant,Pamela Hungerford. Many teachersin KU services were reluctant to enrolchildren with disabilities and neededconsiderable encouragement andsupport. We recognised early on thatthe success of this new programwould depend on the employment ofadequate and trained support staff toimplement the individualised programfor each child. Children of recentarrivals in Australia were more readilyaccepted, but still required skilledsupport. Over the years, teachersand centre staff have embraced thechallenge and now view childrenwith disabilities as an essential andrewarding part of KU’s mission.In 1985, KU’s commitment extendedto the employment of an additionalpart-time special education consultant.Since that time the team has expandedto over six full-time consultants,an indigenous consultant and twopart-time speech pathologists. Thisexpansion recognises the increasedcomplexity of the special educationtask, increasing awareness of childprotection responsibilities and theinclusion of support to children in longday care centres as well as otherservice types. In 1992, in collaborationwith staff from Macquarie University’sInstitute of Early Childhood, the specialeducation team established its first KUfamily support and early interventionprogram called Families First at Airds.This is now called KU Starting Points.Since that date, seven other familyprograms have been developed andare proving to be an alternative wayof responding the needs of vulnerablefamilies outside the traditional centrebased services.There is a constant struggle to findfunding for existing and expandedprograms. KU’s success in winning thetenders for Northern Sydney SCAN(Supporting Children with AdditionalNeeds) and the seven InclusionSupport Agencies in NSW, makethis effort worthwhile so that KU’scommitment to children with additionalneeds can expand beyond KU servicesalone and reach as many children aspossible.Marcia BurgessManager, Special EducationKU’S 110 th ANNUAL REPORT 200511

LONG SERVICE AWARDSAS AT 30 JUNE 200510 YEARS OF SERVICELinda AldridgeTeacher, KU Randwick/Coogee Pre-schoolLouise AnthonyAdvanced Child Care Worker Qualified,Kintaiba Child Care CentreCatherine AthertonTeacher, KU Killarney Heights Pre-schoolElizabeth BarnettTeacher (Admin. Release), KU WickhamPre-schoolMariana CamposTeacher-in-Charge, KU Phillip Park Children’sCentreMabel ChowTeacher, KU Macquarie Park Child Care CentreYonne ChowChild Care Worker (Support Staff),KU Chatswood Community Pre-schoolJanett ClarkDirector, KU Charlestown Occasional CareCentreAllison CollingridgeAdvanced Child Care Worker, Kintaiba ChildCare CentreTracey CollinsDirector, Kooinda Child Care CentreDeborah CreakeDirector, KU Rydalmere Pre-schoolSusan CropperTeacher, KU Bulli Pre-schoolJoy DalyChild Care Worker, KU Liverpool Pre-schoolNatasha DavisDirector, KU Peninsula Pre-schoolLeah DeeneTeacher (Permanent-Relief), KU CT LewisChild Care Centre (Base Centre)Marilyn FeighanChild Care Worker, Kintaiba Child Care CentreElizabeth FraserChild Care Worker, Kintaiba Child CareCentreKaren GarlickTeacher, KU Killara Park Pre-school &Teacher (Admin Release), KU ChatswoodCommunity Pre-schoolRobin HallbergConsultant, AMEP, KU Head OfficeJane HamadehDirector, KU Macquarie Park ChildCare CentreDiana HirschDirector, KU Centennial Parklands Children’sCentreAnna HaywardNurse, KU Phillip Park Children’s CentreKatherine HuntChild Care Worker, KU Henson St Pre-schoolMargaret IrelandTeacher Admin. Release, KU CammerayPre-schoolSusan KennedyTeacher, KU Castlecrag Pre-schoolMarlene KhatchadourianChild Care Worker, KU Osborne Park Pre-schoolFay KnibbsTeacher (Admin. Release), KU KillarneyHeights Pre-schoolDiana LanAdvanced Child Care Worker Qualified,KU Centennial Parklands Children’s CentreBerneice LappanTeacher (Permanent Relief), Greenwood ChildCare Centre (Base Centre)Kathy LawtonDirector, KU Petersham Pre-schoolAnne LinnertTeacher, KU Penrith Pre-schoolGeorgina LukeAdvanced Child Care Worker Qualified, LaurelTree House Child Care CentreVicki McGregorTeacher, KU Sutherland Pre-schoolMary Jane MinshullDirector, KU Peter Pan La Perouse Pre-schoolBernadette MitchellStarting Points Penrith, Teacher-in-ChargeFiona MoultDirector, Windale Pre-schoolGlen NewmanCentre Consultant, Mayfield Regional OfficeJane O’SullivanAdvanced Child Care Worker Qualified(Support Staff), KU Padstow Pre-schoolElisabeth PahorDirector, The Joey ClubAnne PlayfordChild Care Worker, KU Chatswood CommunityPre-schoolJeanette PriceDirector, Kintaiba Child Care CentreDeborah QuirkDirector, KU Bel Air Pre-schoolKim RandallTeacher-in-Charge, KU Burwood Pre-schoolLynette ReidAdvanced Child Care Worker Qualified,Kooinda Child Care CentreAfifa RizkallahChild Care Worker, Auburn AMEPJulie ScherlTeacher (Support Staff), KU Crusader Pre-schoolLucy SevagianChild Care Worker, KU North Ryde Pre-schoolMelanie SuttonCo-ordinator, Inner City Newcastle SupportedPlay GroupMichelle van der ZeeTeacher, KU Hazelbrook Pre-schoolSujatha WanigatungaClerical Assistant, KU Macquarie Park ChildCare CentreNoemi ZicconeDirector, Emerald Hill Child Care Centre(Victoria)15 YEARS OF SERVICELeena AichChild Care Worker, KU South TurramurraPre-schoolJudith BieskeChild Care Worker, KU West Pymble Pre-schoolSharyn BucknellChild Care Worker, KU James Cahill Pre-schoolMirta CaceresChild Care Worker, Parramatta AMEPRebecca ChiuCo-ordinator, Parramatta AMEPZita CofreChild Care Worker, KU CT Lewis ChildCare CentreLyn ColemanTeacher, KU Sutherland Pre-schoolMarion HearneAdvanced Child Care Worker Qualified,Willows Child Care Centre12KU’S 110 th ANNUAL REPORT 2005

Afifa Rizkallah (Child Care Worker, Auburn CCC AMEP)receives her 10 years of service to KU award fromAntoinette le Marchant and Penny Le CouteurAnnette HeslewoodDirector, KU Conjola Place Pre-schoolPriyanthi KulasinghamChild Care Worker, KU Revesby Pre-schoolAngelica MachucaChild Care Worker, The Joey ClubJennifer MasonDirector, KU Swansea Pre-schoolKeri MillerTeacher, KU Swansea Pre-schoolCarole NetterfieldDirector, KU Grevillea Pre-schoolPit NgChild Care Worker, KU Rushcutters BayPre-schoolMelek OzdoganDirector, KU Cheltenham Pre-schoolAida SayourChild Care Worker, KU MilperraPre-schoolSuzanne VlasoffDirector, KU Gwynneville Pre-schoolHuda YassaChild Care Worker, Parramatta AMEPMaureen ZyzekAccounts Administrative Assistant,KU Head Office20 YEARS OF SERVICEPatricia AlvaradoAMEP Mainstream Administrative Assistant,KU Head OfficeSandra DigiglioAdvanced Child Care Worker Qualified,Auburn CCC AMEPAnne DrummondChild Care Worker, KU Berowa Pre-schoolCatherine ForbesTeacher/Teacher-in-Charge, KU MayfieldPre-schoolRosa InostrazaCo-ordinator, Cabramatta AMEPOonagh MartinTeacher, KU Randwick/Coogee Pre-schoolJoseph SinglesHandyman (various KU centres),KU John J Carroll Pre-school (Base)Grace SpeersAdvanced Child Care Worker Qualified,Auburn AMEPRobyn WelshDirector, KU Wickham Pre-school25 YEARS OF SERVICEMichelle UnderwoodManager, Long Day Care Services andBusiness DevelopmentEXTERNAL CONSULTANTSAuditorsSolicitorsInsurance BrokersConsulting ArchitectConsulting LobbyistDeloitte Touche TohmatsuBartier PerryFinn Foster APBDonald WyllieHawker Britton, Justin di LolloLIFE MEMBERSMr AF Batley AM, FCAMiss EM ChartresMiss M ChaseMr G CummingMs GC RemingtonMrs T Godhard AMMs M Griggs OAMMrs FJO GrahamMr R HammondMiss R HarrisonMr SEG ImerMr H KingMrs B McNulty OBEMiss H NewtonMr B PymontKU’S 110 th ANNUAL REPORT 200513

DIRECTORS’ REPORTThe directors of KU Children’s Servicessubmit herewith the annual financial report ofthe company for the financial year ended 31December 2005. In order to comply with theprovisions of the Corporations Act 2001, thedirectors report as follows:The names of the directors of the company whohave held office during or since the end of thefinancial year are:• Bruce Manefield - B.SC, FAICD• Jonathan Hayward - BA (HONS)• Alma Fleet - PhD, MA• Penelope Le Couteur - B.SC (HONS), MAICD• Sarah Cordle - MA, CA• David Bryant - B.BUS, MBA• Sally-Anne Reid - BA.(Econ),B.SC(Maths), DIP ED• Patrick Holland - B.SC, LL.B, GRAD DIP APP.SC• Graham Vimpani - MB BS PhD FRACP FAF PHM• Neil McLennan - B.COM• William Murphy - BA,LL.B (HONS), LL.M• Catherine Reid - BA (HONS)• Jane Ward - BA (HONS), DIP TEACH• Kate Washington - BA, LL.B• Lorraine Young - BA, ASIA, FAIB• Melissa Potter - BA, LLB• Stuart WashingtonThe company secretaries who held office during the year or since theend of the financial year are:• Antoinette le Marchant - BA (HONS), MA (HONS)• Jan FitzgeraldPrincipal ActivityThe company’s principal activity in the course of the financial year wasthat of providing early childhood and family services.Review of operationsThe surplus of KU Children’s Services for the year was $787,869 (2004:$360,299).Changes in state of affairsDuring the financial year there was no significant change in the stateof affairs of the company other than that referred to in the financialstatements or notes thereto.Subsequent eventsThere has not been any matter or circumstance, other than that referredto in the financial statements or notes thereto, that has arisen sincethe end of the financial year, that has significantly affected, or maysignificantly affect the operations of the company, the results of thoseoperations, or the state of affairs of the company in future financialyears.The above named directors held office duringand since the end of the financial year exceptfor:• Sally-Anne Reid (appointed 31/05/05)• Patrick Holland (appointed 31/05/05)• Graham Vimpani (appointed 29/11/05)• Melissa Potter (appointed 28/03/06)• Stuart Washington (appointed 28/03/06)• Bruce Manefield (resigned 3/02/06)• William Murphy (resigned 31/05/05)• Neil McLennan (resigned 31/05/05)• Jonathan Hayward (resigned 31/05/05)• Associate Professor Alma Fleet (resigned3/03/05)Future DevelopmentsDisclosure of information regarding likely developments in the operationsof the company in future financial years and the expected results ofthose operations is likely to result in unreasonable prejudice to thecompany. Accordingly, this information has not been disclosed in thisreport.DividendsKU Children’s Services is a company limited by guarantee. It is prohibitedby its Constitution from paying dividends to members.Indemnification of officers and auditorsDuring the financial year, the company paid a premium in respect ofa contract insuring the directors of the company and all executiveofficers of the company against a liability incurred as such a director or14KU’S 110 th ANNUAL REPORT 2005

officers of the company against aliability incurred as such a directoror executive officer to the extentpermitted by the Corporations Act2001. The contract of insuranceprohibits disclosure of the nature ofthe liability and the amount of thepremium.The company has not otherwise,during or since the financial year,indemnified or agreed to indemnify anofficer or auditor of the company or ofany related body corporate against aliability incurred as such an officer orauditor.Directors’ MeetingsThe following table sets out the number of directors’ meetings (includingmeetings of committees of directors) held during the financial year and thenumber of meetings attended by each director (while they were a director orcommittee member). During the financial year, ten Board meetings, six FinanceCommittee meetings and three Education Committee meetings held.The auditors’ independence declaration is included on page 17 of the financialreport.Signed in accordance with a resolution of the directors made pursuant tos.298(2) of the Corporations Act 2001.On behalf of the DirectorsPenny Le CouteurHon. PresidentSarah CordleHon. TreasurerSydney, 24 April 2006 Sydney, 24 April 2006TABLE 1 - DIRECTORS’ MEETINGSBoard of Directors Finance Committee Education CommitteeAttended Held Attended Held Attended HeldDavid Bryant 10 9 # # # #Sarah Cordle 10 9 6 5 # #Alma Fleet (Resigned 3/03/05) 4 1 # # # #Jonathan Hayward (Resigned 31/05/05) 4 3 2 1 # #Patrick Holland (Appointed 31/05/05) 6 4 4 3 # #Penelope Le Couteur 10 10 6 4 # #Neil McLennan (Resigned 31/05/05) 4 1 2 1 # #Bruce Manefield (Resigned 3/02/06) 10 5 # # # #William Murphy (Resigned 31/05/05) 4 3 # # # #Catherine Reid 10 9 # # 3 3Sally-Anne Reid (Appointed 31/05/05) 6 4 6 2 3 2Jane Ward 10 8 6 5 # #Kate Washington 10 7 # # # #Graham Vimpani (Appointed 29/11/05) - - # # # #Lorraine Young 10 8 # # 3 1# Indicates not a member of relevant committee.KU’S 110 th ANNUAL REPORT 200515

The Board of DirectorsKU Children’s Services129 York StreetSYDNEY NSW 2000Deloitte Touche TohmatsuA.B.N. 74 490 121 060Grosvenor Place225 George StreetSydney NSW 2000PO Box N250 Grosvenor PlaceSydney NSW 1220 AustraliaDX 10307SSETel: +61 (0) 2 9322 7000Fax: +61 (0) 2 9322 7001www.deloitte.com.au24 April 2006Dear Board MembersKU Children’s ServicesIn accordance with section 307C of the Corporations Act 2001, I am pleased to provide the followingdeclaration of independence to the directors of KU Children’s Services.As lead audit partner for the audit of the financial statements of KU Children’s Services for thefinancial year ended 31 December 2005, I declare that to the best of my knowledge and belief,there have been no contraventions of:(i)(ii)the auditor independence requirements of the Corporations Act 2001 in relation to theaudit; andany applicable code of professional conduct in relation to the audit.Yours faithfullyDELOITTE TOUCHE TOHMATSUJulia BickerstaffPartnerChartered Accountants16KU’S 110 th ANNUAL REPORT 2005

INDEPENDENT AUDIT REPORT TO THE MEMBERSOF KU CHILDREN’S SERVICESSCOPEThe Financial Report andDirectors’ ResponsibilityThe financial report comprises thebalance sheet, income statement,cash flow statement, statement ofrecognised income and expense, asummary of significant accountingpolicies and other explanatory notesand the directors’ declaration for KUChildren’s Services, for the financialyear ended 31 December 2005 as setout on pages 18 to 36.The directors of the company areresponsible for the preparation andtrue and fair presentation of thefinancial report in accordance withAccounting Standards in Australiaand the Corporations Act 2001.This includes responsibility for themaintenance of adequate financialrecords and internal controls that aredesigned to prevent and detect fraudand error, and for the accountingpolicies and accounting estimatesinherent in the financial report.Audit ApproachWe have conducted an independentaudit of the financial report in orderto express an opinion on it to themembers of the company. Our audithas been conducted in accordancewith Australian Auditing Standardsto provide reasonable assurancewhether the financial report is free ofmaterial misstatement. The nature ofan audit is influenced by factors suchas the use of professional judgement,selective testing, the inherentlimitations of internal controls, andthe availability of persuasive ratherthan conclusive evidence. Therefore,an audit cannot guarantee that allmaterial misstatements have beendetected.We performed procedures to forman opinion whether, in all materialrespects, the financial report ispresented fairly in accordance withAccounting Standards in Australia andthe Corporations Act 2001 so as topresent a view which is consistent withour understanding of the company’sfinancial position, and performanceas represented by the results of itsoperations, its changes in equity andits cash flows.Our procedures included examination,on a test basis, of evidence supportingthe amounts and other disclosures inthe financial report, and the evaluationof accounting policies and significantaccounting estimates made by thedirectors.While we considered the effectivenessof management’s internal controlsover financial reporting whendetermining the nature and extent ofour procedures, our audit was notdesigned to provide assurance oninternal controls.The audit opinion expressed in thisreport has been formed on the abovebasis.QUALIFICATIONDonations and fundraising revenue area source of revenue for KU Children’sServices. KU Children’s Services hasdetermined that it is impracticable toestablish control over the collectionof donations and fundraising revenueprior to entry into its financial records.Accordingly, as the evidence availableto us regarding revenue from thesesources were limited, our auditprocedures with respect to donationsand fundraising revenue had to berestricted to the amounts recordedin the financial records. We thereforeare unable to express an opinionwhether donations and fundraising thatKU Children’s Services obtained arecomplete.Audit OpinionIn our opinion, the financial reportof KU Children’s Services is inaccordance with the Corporations Act2001, including:a) giving a true and fair view of thecompany’s financial position asat 31 December 2005 and of itsperformance for the year ended onthat date;b) complying with AccountingStandards in Australia and theCorporations Regulations 2001;c) the financial report gives a trueand fair view, in accordance withAccounting Standards in Australiaand the Corporations Act 2001,of the financial results of thefundraising appeal activities for thefinancial year ended 31 December2005;d) the financial report and associatedrecords of the company havebeen properly kept, in all materialrespects, in accordance with theCharitable Fundraising Act, 1991and its regulations; ande) monies received as a result offundraising appeals conductedduring the financial year have, in allmaterial respects, been properlyaccounted for in accordance withthe Charitable Fundraising Act1991 and its regulations.Deloitte Touche TohmatsuJulia BickerstaffPartnerChartered AccountantsSydney, 24 April 2006KU’S 110 th ANNUAL REPORT 200517

DIRECTORS’ DECLARATIONThe directors declare that:a) in the directors’ opinion, there are reasonable grounds to believe that the company will be able to pay its debts asand when they become due and payable; andb) in the directors’ opinion, the attached financial statements and notes thereto are in accordance with the CorporationsAct 2001, including compliance with accounting standards and giving a true and fair view of the financial position andperformance of the company.Signed in accordance with a resolution of the directors made pursuant to s.295(5) of the Corporations Act 2001.On behalf of the DirectorsPenny Le CouteurHon. PresidentSarah CordleHon. TreasurerSydney, 24 April 2006 Sydney, 24 April 2006DIRECTORS’ DECLARATION IN RESPECT OFFUNDRAISING APPEALSIn the opinion of the Board of Directors:i) the accounts give a true and fair view of all income and expenditure of KU Children’s Services with respect tofundraising activities;ii) the Balance Sheet as at 31 December 2005 gives a true and fair view of the state of affairs with respect to fundraisingactivities;iii) the provision of the Charitable Fundraising Act 1991 and the Regulations under that Act and the conditions attached tothe authority have been complied with to the organisation’s best ability;iv) the internal controls exercised by KU Children’s Services are appropriate and effective in accounting for all incomereceived and applied by the organisation from any of its fundraising appeals; andv) the level of disclosure for fundraising was limited by the existing management systems in use by the organisation.Signed in accordance with a resolution of the Board of Directors.Penny Le CouteurHon. PresidentSarah CordleHon. TreasurerSydney, 24 April 2006 Sydney, 24 April 200618KU’S 110 th ANNUAL REPORT 2005

INCOME STATEMENTFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2005NOTE 2005 2004$ $Revenue 2 40,373,156 37,085,349Employee benefits expense (31,571,186) (29,094,291)Depreciation expense (414,368) (333,950)Repairs and maintenance expense (952,555) (722,678)Occupancy expense (588,349) (575,897)Childcare centre expense (4,665,135) (4,438,850)Other expenses (1,393,694) (1,559,384)Surplus for the period 2 787,869 360,299Notes to the financial statements are included on pages 22 to 36.KU’S 110 th ANNUAL REPORT 200519

BALANCE SHEETAS AT 31 DECEMBER 2005NOTE 2005 2004$ $Current AssetsCash and cash equivalents 19(b) 10,413,647 6,723,783Trade and other receivables 5 2,110,336 2,758,859Other financial assets 6 6,927,118 6,115,737Other 7 30,322 534,797Total Current Assets 19,481,423 16,133,176Non-Current AssetsProperty, plant and equipment 8 4,208,388 4,087,777Total Non-Current Assets 4,208,388 4,087,777Total Assets 23,689,811 20,220,953Current LiabilitiesTrade and other payables 9 8,232,890 6,753,156Provisions 10 3,141,172 2,245,372Other 11 1,968,564 2,138,322Total Current Liabilities 13,342,626 11,136,850Non-Current LiabilitiesProvisions 10 791,393 778,405Total Non-Current Liabilities 791,393 778,405Total Liabilities 14,134,019 11,915,255Net Assets 9,555,792 8,305,698EquityRetained earnings 12 6,303,949 6,517,145Reserves 13 3,251,843 1,788,553Total Equity 9,555,792 8,305,698Notes to the financial statements are included on pages 22 to 36.20KU’S 110 th ANNUAL REPORT 2005

STATEMENT OF RECOGNISED INCOME AND EXPENSEFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2005NOTE 2005 2004$ $Available-for-sale investments:Valuation gain taken to equity 14 462,225 498,192Net income recognised directly into equity 462,225 498,192Surplus for the period 787,869 360,299Total recognised income and expense for the period 1,250,094 858,491CASH FLOW STATEMENTFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 2005NOTE 2005 2004$ $Cash Flows from Operating ActivitiesReceipts from customers, government bodies and centres 44,333,154 41,526,086Payments to suppliers and employees (40,390,300) (39,856,360)Interest received 284,827 189,741Dividends received 349,156 219,110Net cash provided by operating activities 19(a) 4,576,837 2,078,577Cash Flows from Investing ActivitiesPayments for investment securities (349,156) (219,110)Payment for property, plant and equipment (554,181) (878,938)Proceeds from sale of property, plant and equipment 16,364 64,545Net cash (used in) investing activities (886,973) (1,033,503)Net increase in cash and cash equivalent 3,689,864 1,045,074Cash and cash equivalent at the beginning of the financial year 6,723,783 5,678,709Cash and cash equivalent at the end of the financial year 19(b) 10,413,647 6,723,783Notes to the financial statements are included on pages 22 to 36.KU’S 110 th ANNUAL REPORT 200521

NOTES TO THE FINANCIAL STATEMENTSFOR THE FINANCIAL YEAR ENDED 31 DECEMBER 20051. Summary of Accounting PoliciesStatement of ComplianceThe financial report is a general purpose financial reportwhich has been prepared in accordance with the CorporationsAct 2001, Accounting Standards and Urgent Issues GroupInterpretations, and complies with other requirements of thelaw. Accounting Standards include Australian equivalentsto International Financial Reporting Standards (‘A-IFRS’). Astatement of compliance with IFRS cannot be made due tothe application of not-for-profit sector specific requirementscontained in the A-IFRS.The financial statements were authorised for issue by thedirectors on 24 April 2006.Basis of PreparationThe financial report has been prepared on the basis ofhistorical cost, except for the revaluation of certain non-currentassets and financial instruments. Cost is based on the fairvalues of the consideration given in exchange for assets.In the application of A-IFRS management is required to makejudgments, estimates and assumptions about carrying valuesof assets and liabilities that are not readily apparent from othersources. The estimates and associated assumptions are basedon historical experience and various other factors that arebelieved to be reasonable under the circumstance, the resultsof which form the basis of making the judgments. Actualresults may differ from these estimates.The estimates and underlying assumptions are reviewed onan ongoing basis. Revisions to accounting estimates arerecognised in the period in which the estimate is revised if therevision affects only that period, or in the period of the revisionand future periods if the revision affects both current andfuture periods.Judgments made by management in the application of A-IFRSthat have significant effects on the financial statements andestimates with a significant risk of material adjustments in thenext year are disclosed, where applicable, in the relevant notesto the financial statements.Accounting policies are selected and applied in a manner whichensures that the resulting financial information satisfies theconcepts of relevance and reliability, thereby ensuring that thesubstance of the underlying transactions or other events isreported.The company changed its accounting policies on 1 January2005 to comply with A-IFRS. The transition to A-IFRS isaccounted for in accordance with Accounting Standard AASB1 ‘First-time Adoption of Australian Equivalents to InternationalFinancial Reporting Standards’, with 1 January 2004 as thedate of transition. An explanation of how the transition fromsuperseded policies to A-IFRS has affected company’s financialposition, financial performance and cash flows is discussed inNote 21.The directors have also elected under s.334(5) of theCorporations Act 2001 to apply Accounting Standard AASB119 ‘Employee Benefits’ (December 2004), even though theStandard is not required to be applied until annual reportingperiods beginning on or after 1 January 2006.The accounting policies set out below have been applied inpreparing the financial statements for the year ended 31December 2005, the comparative information presented inthese financial statements for the year ended 31 December2004, and in the preparation of the opening A-IFRS balancesheet at 1 January 2004 (as disclosed in Note 21), thecompany’s date of transition.The following significant accounting policies have beenadopted in the preparation and presentation of the financialreport:a) Company Limited by GuaranteeThe company is incorporated as a company limited byguarantee. In accordance with the Constitution everymember of the Company undertakes to contribute to theassets of the Company in the event of it being wound up,while he/she is a member or within one year after he/sheceases to be a member, the sum of $2. The company has6,240 members.b) PayablesTrade payables and other accounts payable arerecognised when the company becomes obliged to makefuture payments resulting from the purchase of goods andservices.c) Property, Plant and EquipmentLand and buildings, plant, furniture and equipment,motor vehicles and computers are stated at cost lessaccumulated depreciation and impairment. Cost includesexpenditure that is directly attributable to the acquisitionof the item. In the event that settlement of all or part ofthe purchase consideration is deferred, cost is determinedby discounting the amounts payable in the future to theirpresent value as at the date of acquisition.Depreciation is provided on plant, furniture and equipment,motor vehicles and computers, including freehold buildingsbut excluding land. Depreciation is calculated on a straightline basis so as to write off the net cost of each asset overits expected useful life to its estimated residual value. Theestimated useful lives, residual values and depreciationmethod are reviewed at the end of each annual reportingperiod.The following estimated useful lives are used in calculationof depreciation:- Buildings 40.0 years- Plant, furniture and equipment 6.7years22KU’S 110 th ANNUAL REPORT 2005

- Motor vehicles 4.4 years- Computers 4.0 yearsd) Employee BenefitsProvision is made for benefits accruing to employees inrespect of wages and salaries, annual leave, long serviceleave and rostered days off when it is probable thatsettlement will be required and they are capable of beingmeasured reliably.Provisions made in respect of employee benefits expectedto be settled within 12 months, are measured at theirnominal values using the remuneration rate expected toapply at the time of settlement.Provisions made in respect of employee benefits which arenot expected to be settled within 12 months are measuredas the present value of the estimated future cash outflowsto be made by the company in respect of servicesprovided by employees up to reporting date.Defined Contribution PlansContributions to defined contribution superannuation plansare expensed when incurred.e) Goods and Services TaxRevenues, expenses and assets are recognised net of theamount of goods and services tax (GST), except:i) where the amount of GST incurred is not recoverablefrom the taxation authority, it is recognised as partof the cost of acquisition of an asset or as part of anitem of expense; orii)for receivables and payables which are recognisedinclusive of GST.The net amount of GST recoverable from, or payable to,the taxation authority is included as part of receivables orpayables.Cash flows are included in the cash flow statement on agross basis. The GST component of cash flows arisingfrom investing and financing activities which is recoverablefrom, or payable to, the taxation authority is classified asoperating cash flows.f) Financial AssetsInvestments are recognised and derecognised on tradedate where purchase or sale of an investment is under acontract whose terms require delivery of the investmentwithin the timeframe established by the market concerned,and are initially measured at fair value, net of transactioncosts.Financial assets are classified into the following specifiedcategories: financial assets ‘available-for-sale’ and ‘loansand receivables’. The classification depends on the natureand purpose of the financial assets and is determined atthe time of initial recognition.Loans and ReceivablesTrade receivables, loans, and other receivables arerecorded at amortised cost less impairment.Available-for-Sale Financial AssetsManaged funds held by the company are classified asbeing available-for-sale and are stated at fair value lessimpairment. Fair value is determined using the closingmarket prices at year end. Gains and losses arisingfrom changes in fair value are recognised directly in theavailable-for-sale revaluation reserve, until the investment isdisposed of or is determined to be impaired, at which timethe cumulative gain or loss previously recognised in theavailable-for-sale revaluation reserve is included in profit orloss for the period.g) Impairment of AssetsAt each reporting date, the company reviews the carryingamounts of its tangible assets to determine whetherthere is any indication that those assets have sufferedan impairment loss. If any such indication exists, therecoverable amount of the asset is estimated in orderto determine the extent of the impairment loss (if any).Where the asset does not generate cash flows that areindependent from other assets, the company estimatesthe recoverable amount of the cash-generating unit towhich the asset belongs.Recoverable amount is the higher of fair value less coststo sell and value in use. In assessing value in use, theestimated future cash flows are discounted to their presentvalue using a pre-tax discount rate that reflects currentmarket assessments of the time value of money and therisks specific to the asset for which the estimates of futurecash flows have not been adjusted.If the recoverable amount of an asset (or cash-generatingunit) is estimated to be less than its carrying amount,the carrying amount of the asset (cash-generating unit) isreduced to its recoverable amount. An impairment lossis recognised in profit or loss immediately, unless therelevant asset is carried at fair value, in which case theimpairment loss is treated as a revaluation decrease.Where an impairment loss subsequently reverses, thecarrying amount of the asset (cash-generating unit) isincreased to the revised estimate of its recoverableamount, but only to the extent that the increased carryingamount does not exceed the carrying amount that wouldhave been determined had no impairment loss beenrecognised for the asset (cash-generating unit) in prioryears. A reversal of an impairment loss is recognisedin profit or loss immediately, unless the relevant assetis carried at fair value, in which case the reversal of theimpairment loss is treated as a revaluation increase.h) Leased AssetsLeases are classified as finance leases whenever theterms of the lease transfer substantially all the risks andrewards of ownership to the lessee. All other leases areclassified as operating leases.Company as LesseeOperating lease payments are recognised as an expenseon a straight-line basis over the lease term, except whereKU’S 110 th ANNUAL REPORT 200523

another systematic basis is more representative of thetime pattern in which economic benefits from the leasedasset are consumed.Company as LessorRental income from operating leases is recognised on astraight line basis over the term of the relevant lease.Lease IncentivesIn the event that lease incentives are received to enterinto operating leases, such incentives are recognisedas a liability. The aggregate benefits of incentives arerecognised as a reduction of rental expense on a straightlinebasis, except where another systematic basis is morerepresentative of the time pattern in which economicbenefits from the leased asset are consumed.i) Revenue RecognitionRendering of ServicesRevenue from a contract to provide services is recognisedby reference to the stage of completion of the contract.Interest RevenueInterest revenue is recognised on a time proportionatebasis that takes into account the effective yield on thefinancial asset.Dividend RevenueDividend is recognised on a receivable basis.j) Cash and Cash EquivalentsCash and cash equivalents comprise cash on hand andcash in banks.k) ProvisionsProvisions are recognised when the company has apresent obligation, the future sacrifice of economicbenefits is probable, and the amount of the provision canbe measured reliably.The amount recognised as a provision is the best estimateof the consideration required to settle the presentobligation at reporting date, taking into account the risksand uncertainties surrounding the obligation.Where a provision is measured using the cashflowsestimated to settle the present obligation, its carryingamount is the present value of those cashflows.where there are no conditions specifically relating tothe operating activities of the company other than therequirement to operate in certain regions or industrysectors.Government grants are credited to income in accordancewith the conditions attached to the funding agreement.Government grants relating to assets are treated asdeferred income and recognised in profit and loss over theexpected useful lives of the assets concerned.m) Investment PropertiesInvestment property, which is property held to earn rentalsand/or for capital appreciation, is measured at cost.Depreciation is provided on investment properties. It iscalculated on a straight line basis so as to write off thenet cost of the property over its expected useful life toits estimated residual value. The estimated useful lives,residual value and depreciation method are reviewed atthe end of each annual reporting period. The estimateduseful live of the investment properties is estimated to be40 years.n) Income TaxThe company is exempt from income tax under s50-5 ofthe Income Tax Assessment Act, as it is an income taxexempt charitable entity. As a consequence, there is noincome tax attributable to the operating result.o) General ReserveSalary Recovery FundExcess or under recoveries of wages and salariesexpenditure re-charged by Head Office or Centres aretransferred (after inclusion of external income earnedby the Head Office) to the Salary Recovery Fund. At thediscretion of the Board of Directors, the balance of thisFund could be used to meet shortfalls of salary costs andsalary related on-costs normally recoverable from Centres.Motor Vehicle Replacement ReserveThis fund represents monies set aside to purchasereplacement vans for mobile services.Capital WorksThis fund represents grants received but not yet spent inrespect of capital projects.When some or all of the economic benefits required tosettle a provision are expected to be recovered from athird party, the receivable is recognised as an asset if itis virtually certain that recovery will be received and theamount of the receivable can be measured reliably.l) Government GrantsGovernment grants are assistance by the governmentin the form of transfers of resources to the companyin return for past or future compliance with certainconditions relating to the operating activities of theentity. Government grants include government assistance24KU’S 110 th ANNUAL REPORT 2005

2005 2004$ $2. Surplus from operationsa) RevenueRevenue from operations consisted from the following items:Government grants 12,630,057 11,954,410Parents’ fees 22,712,174 19,856,983Gross fundraising income 674,078 661,515Consultancy income and management fees 3,045,820 3,113,671Interest revenue - bank deposits 281,949 190,039Dividends - other entries 349,156 219,110Sales of publications and courses 17,352 11,927Sponsor support 17,012 16,988Rent revenue:Operating lease revenue:Investment properties 211,052 211,329Reversal of prior period losses on revaluation of ‘available-for-sale’ financial assets - 59,568Other revenue 434,506 789,80940,373,156 37,085,349b) SurplusSurplus has been arrived at after charging the following losses:Loss on disposal of property, plant and equipment (2,838) (4,058)Depreciation of non-current assets (414,368) (333,950)Operating lease rental expenses:Minimum lease payments (505,579) (475,102)Net bad and doubtful debts arising from:Other entities (26,993) (18,964)KU’S 110 th ANNUAL REPORT 200525

3. key management Personnel RemunerationThe specified directors of KU Children’s Services during the year were:• Bruce Manefield (non-executive), resigned 3 February 2006• Jonathan Hayward (non-executive), resigned 31 May 2005• Alma Fleet (non-executive), resigned 3 March 2005• Penelope Le Couteur (non-executive)• Sarah Cordle (non-executive)• David Bryant (non-executive)• Sally-Anne Reid (non-executive), appointed 31 May 2005• Patrick Holland (non-executive), appointed 31 May 2005• Graham Vimpani (non-executive), appointed 29 November 2005• Neil McLennan (non-executive), resigned 31 May 2005• William Murphy (non-executive), resigned 31 May 2005• Catherine Reid (non-executive)• Jane Ward (non-executive)• Kate Washington (non-executive)• Lorraine Young (non-executive)No director has received or become entitled to receive any remunerationfrom the company in their capacity as a director (2004: nil).The specified executives of KU Children’s Services during the year were:• Antoinette le Marchant – Chief Executive Officer• Neil Fletcher – Chief Financial Officer• Michelle Underwood – Manager Long Day Care Services• Chris Legg – Manager Pre-school Services• Brian Russell – Manager Human Resources• Ian Makins – Manager OHS and Injury Management• Marcia Burgess – Manager Special Education• Luke Borojevic – Manager Information Technology• Jan Fitzgerald – Manager Office Services2005 2004$ $The aggregate compensation of the key executive management personnel of thecompany is set out below:Short term employee benefits: 1,023,870 956,39626KU’S 110 th ANNUAL REPORT 2005

2005 2004$ $4. Remuneration of auditorsAudit of the financial report 43,000 31,500Other – Audit of government grants 22,000 22,500Other services – Accounting Assistance 16,000 25,00081,000 79,000The auditor of KU Children’s Services is Deloitte Touche Tohmatsu.5. Current trade and other receivablesTrade ReceivablesOwing by non-controlled centres 914,337 1,331,997Allowance for doubtful debts (67,090) (67,090)847,247 1,264,907Other ReceivablesInterest income receivable - 2,878Other receivables 1,263,089 1,491,0742,110,336 2,758,8596. OTHER CURRENT FINANCIAL ASSETSAvailable for sale financial assetsAt fair value:Investment in managed funds 6,927,118 6,115,7377. OTHER CURRENT ASSETSPrepayments 30,322 534,797KU’S 110 th ANNUAL REPORT 200527

8. PROPERTY, PLANT AND EQUIPMENTLand & Buildingsat CostPlant & Equipmentat CostMotorVehicles at CostTotal$ $ $ $Gross Carrying Amount - at costBalance at 1 January 2004 3,986,628 614,697 323,734 4,925,059Additions 630,463 148,214 100,261 878,938Disposals - - (104,296) (104,296)Balance at 31 December 2004 4,617,091 762,911 319,699 5,699,701Additions 355,919 141,332 56,930 554,181Disposals - - (27,999) (27,999)Balance at 31 December 2005 4,973,010 904,243 348,630 6,225,883Accumulated DepreciationBalance at 1 January 2004 (899,758) (317,488) (96,421) (1,313,667)Disposals - - 35,693 35,693Depreciation expense (149,377) (128,889) (55,684) (333,950)Balance at 31 December 2004 (1,049,135) (446,377) (116,412) (1,611,924)Disposals - - 8,797 8,797Depreciation expense (206,917) (145,143) (62,308) (414,368)Balance at 31 December 2005 (1,256,052) (591,520) (169,923) (2,017,495)Net Book ValueAs at 31 December 2004 3,567,956 316,534 203,287 4,087,777As at 31 December 2005 3,716,958 312,723 178,707 4,208,388Aggregate depreciation allocated, whether recognised as an expense or capitalised aspart of the carrying amount of other assets during the year2005 2004$ $Land, buildings and improvements 206,917 149,377Furniture and office equipment 145,143 128,889Motor vehicles 62,308 55,684414,368 333,95028KU’S 110 th ANNUAL REPORT 2005

2005 2004$ $9. Trade and other PayablesPrepaid Government Grants 3,339,298 3,175,405Prepaid Special Education Income 1,048,520 434,437Accrued Migrant & Handicapped Expenditure 53,445 57,291Salary and Superannuation Accruals 1,876,305 1,568,466Prepaid Centre Fees & Holding Deposits 1,061,736 910,437Goods and Services Tax (GST) Payable 35,888 172,825Other Creditors and Accruals 817,698 434,2958,232,890 6,753,15610. ProvisionsCurrentEmployee Benefits:Provision for Holiday Pay & Rostered Days Off 1,792,823 1,162,676Provision for Long Service Leave 1,348,349 1,082,6963,141,172 2,245,372Non-CurrentEmployee Benefits:Provision for Long Service Leave 791,393 778,40511. OTHER CURRENT LIABILITIESDeferred Revenue 1,968,564 2,138,32212. RETAINED EARNINGSBalance at beginning of financial year 6,517,145 6,236,848Net surplus 787,869 360,299Net transfers to reserves (Note 13) (1,001,065) (80,002)Balance at end of financial year 6,303,949 6,517,14513. ReservesSalary Recovery Fund 1,345,299 451,788Capital Works Projects 101,065 91,629Motor Vehicle Replacement reserve 6,929 5,773Fundraising reserve 838,133 741,171Available for sale revaluation reserve (Note 14) 960,417 498,1923,251,843 1,788,553KU’S 110 th ANNUAL REPORT 200529

13. reserves (CONTINUED)2005FundraisingReserve (i)SalaryRecovery FundCapital WorksProjectsMotor VehiclesReplacementReserve$ $ $ $ $Balance at beginning of financial year 741,171 451,788 91,629 5,773 1,290,361Transfer from retained earnings 96,962 893,511 9,436 1,156 1,001,065Balance at end of financial year 838,133 1,345,299 101,065 6,929 2,291,4262004TotalFundraisingReserve (i)SalaryRecovery FundCapital WorksProjectsMotor VehiclesReplacementReserveTotal$ $ $ $ $Balance at beginning of financial year 653,938 381,362 163,364 11,695 1,210,359Transfer from retained earnings 87,233 70,426 (71,735) (5,922) 80,002Balance at end of financial year 741,171 451,788 91,629 5,773 1,290,361(i) Further notes on fundraising are set out in Note 2214. Available for sale revaluation reserve2005 2004$ $Balance at beginning of financial year 498,192 -Valuation gain recognised 462,225 498,192Balance at end of financial year 960,417 498,192The available-for-sale revaluation reserve arises on the revaluation of available-for-salefinancial assets. Where a revalued financial asset is sold that portion of the reservewhich relates to that financial asset, and is effectively realised, is recognised in profitor loss. Where a revalued financial asset is impaired that portion of the reserve whichrelates to that financial asset is recognised in profit or loss.15. LEASESOperating LeasesLeasing arrangementsOperating leases relate to centre facilities. The company does not have an option topurchase the leased assets at the expiry of the lease period.Non-cancellable operating leasesNot longer than 1 year 349,752 475,100Longer than 1 year and not longer than 5 years 501,337 1,150,000Longer than 5 years 149,271 90,0001,000,360 1,715,10030KU’S 110 th ANNUAL REPORT 2005

16. ECONOMIC DEPENDENCYThe company is significantly dependent on Federal Government, State Government and Local Government for funding for thepurpose of providing early childhood and family services.17. SEGMENT INFORMATIONThe company operated in one business segment, being the provision of early childhood and family services and in onegeographical location being Australia.18. RELATED PARTY disclosuresThere were no related party transactions, except for the following. A director of the company, Mr William Murphy, is themanaging partner in the legal firm, Bartier Perry, which renders legal advice to the company. All transactions are on normalcommercial terms and conditions and in the ordinary course of business. Total fees paid and payable to Bartier Perry during thefinancial period were $37,061 (2004: $21,904).2005 2004$ $19. NOTES TO THE CASH FLOW STATEMENTa) Reconciliation of Surplus for the period to Net Cash Flows from Operating ActivitiesSurplus for the period 787,869 360,299Depreciation and amortisation of non-current assets 414,368 333,950Loss on sale of non-current assets 2,838 4,058Gain on investment securities - (59,568)Changes in net assets and liabilities:Decrease in current receivables 1,152,999 154,497Increase in current payables 1,309,975 1,048,902Increase in provisions 908,788 236,439Net cash from operating activities 4,576,837 2,078,577b) Reconciliation of Cash and Cash EquivalentsFor the purposes of the statement of cash flows, cash includes cash at bank and on hand.Cash at the end of the financial year as shown in the statement of cash flows is reconciled tothe related items in the statement of financial position as follows:Cash and cash equivalents 10,413,647 6,723,78320. FINANCIAL INSTRUMENTSa) Financial Risk Management ObjectivesThe company does not enter into or trade financial instruments for speculative purposes. The company does not use derivativefinancial instruments.The company’s activities expose it primarily to the financial risks of changes in interest rates.b) Significant Accounting PoliciesDetails of the significant accounting policies and methods adopted, including the criteria for recognition, the basis ofmeasurement and the basis on which revenues and expenses are recognised, in respect of each class of financial asset, financialliability and equity instruments are disclosed in Note 1 to the financial statements.KU’S 110 th ANNUAL REPORT 200531

20. financial instruments (Continued)c) Interest Rate Risk ManagementThe company is exposed to interest rate risk as it invests its surplus funds in variable rate instruments. The risk is managed byregular review of its variable interest rate investments. The following table details the company’s exposure to interest rate risk atthe balance date:2005Financial AssetsRevenueAverageInterestRateVariableInterest RateFixed Interest Rate MaturityLess Than1 Year1 to 5YearsMore Than5 YearsNon-InterestBearing% $ $ $ $ $ $TotalCash 4.9% 10,413,647 - - - - 10,413,647Receivables - - - - - 2,140,658 2,140,658Investment in Managed Funds 7.02% 6,927,118 - - - - 6,927,11817,340,765 - - - 2,140,658 19,481,423Financial LiabilitiesPayables - - - - - 8,232,889 8,232,889Employee Benefits - - - - - 3,932,565 3,932,565- - - - - 12,165,454 12,165,454The following table details the company’s exposure to interest rate risk as at 31 December 2004:2004Financial AssetsRevenueAverageInterestRateVariableInterest RateFixed Interest Rate MaturityLess Than1 Year1 to 5YearsMore Than5 YearsNon-InterestBearing% $ $ $ $ $ $TotalCash 3% 6,723,783 - - - - 6,723,783Receivables - - - - - 3,293,656 3,293,656Investment in Managed Funds 4.8% 6,115,737 - - - - 6,115,73712,839,520 - - - 3,293,656 16,133,176Financial LiabilitiesPayables - - - - - 6,753,156 6,753,156Employee Benefits - - - - - 3,023,777 3,023,777- - - - - 9,776,933 9,776,933d) Credit RiskCredit risk refers to the risk that a counterparty will default on its contractual obligations resulting in financial loss to thecompany. The company has adopted the policy of only dealing with creditworthy counterparties. The company does not haveany significant credit risk exposure to any single counterparty or any group of counterparties having similar characteristics.The carrying amount of financial assets recorded in the financial statements, net of any provisions for losses, represents thecompany’s maximum exposure to credit risk.e) Fair Value of Financial InstrumentsThe directors consider that the carrying amount of financial assets and financial liabilities recorded in the financial statementsapproximates their respective net fair values, determined in accordance with the accounting policies disclosed in Note 1 to thefinancial statements.f) Liquidity Risk ManagementThe company manages liquidity risk by maintaining adequate reserves, banking facilities and reserve borrowing facilities bycontinuously monitoring forecast and actual cash flows and matching the maturity profiles of financial assets and liabilities.32KU’S 110 th ANNUAL REPORT 2005

21. Impacts of Adopting the Australian Equivalents to International FinancialReporting StandardsThe company changed its accounting policies on 1 January 2005 to comply with Australian equivalents to International FinancialReporting Standards (‘A-IFRS’). The transition to A-IFRS is accounted for in accordance with Accounting Standard AASB 1‘First-time Adoption of Australian Equivalents to International Financial Reporting Standards’, with 1 January 2004 as the date oftransition.An explanation of how the transition from superseded policies to A-IFRS has affected and company’s financial position, financialperformance and cash flows is set out in the following tables and the notes that accompany the tables.Effect of A-IFRS on the balance sheet as at 1 January 2004NoteSupersededPolicies*Effect ofTransition toA-IFRSA-IFRS$ $ $Current AssetsCash and cash equivalents 5,678,709 - 5,678,709Trade and other receivables 3,007,699 - 3,007,699Other financial assets 5,538,867 - 5,538,867Other 440,454 - 440,454Total Current Assets 14,465,729 - 14,465,729Non-Current AssetsProperty, plant and equipment 3,611,392 - 3,611,392Total Non-Current Assets 3,611,392 - 3,611,392Total Assets 18,077,121 - 18,077,121Current LiabilitiesTrade and other payables 6,392,576 - 6,392,576Provisions 1,412,177 - 1,412,177Other 1,450,000 - 1,450,000Total Current Liabilities 9,254,753 - 9,254,753Non-Current LiabilitiesProvisions 1,375,161 1,375,161Total Non-Current Liabilities 1,375,161 - 1,375,161Total Liabilities 10,629,914 - 10,629,914Net Assets 7,447,207 - 7,447,207EquityAccumulated funds 6,236,848 - 6,236,848Reserves 1,210,359 - 1,210,359Total Equity 7,447,207 - 7,447,207* Reported financial position for the financial year ended 31 December 2003KU’S 110 th ANNUAL REPORT 200533

21. Impacts of Adopting the Australian Equivalents to International FinancialReporting Standards (continued)Effect of A-IFRS on the balance sheet as at 31 December 2004NoteSupersededPolicies*Effect ofTransition toA-IFRSA-IFRS$ $ $Current AssetsCash and cash equivalents 6,723,783 - 6,723,783Trade and other receivables 2,758,859 - 2,758,859Other financial assets 6,115,737 - 6,115,737Other 534,797 - 534,797Total Current Assets 16,133,176 - 16,133,176Non-Current AssetsProperty, plant and equipment 4,087,777 - 4,087,777Total Non-Current Assets 4,087,777 - 4,087,777Total Assets 20,220,953 - 20,220,953Current LiabilitiesTrade and other payables 6,753,156 - 6,753,156Provisions (b) 1,577,546 667,826 2,245,372Other 2,138,322 - 2,138,322Total Current Liabilities 10,469,024 667,826 11,136,850Non-Current LiabilitiesProvisions (b) 1,446,231 (667,826) 778,405Total Non-Current Liabilities 1,446,231 (667,826) 778,405Total Liabilities 11,915,255 - 11,915,255Net Assets 8,305,698 - 8,305,698EquityAccumulated funds (a) 7,015,337 (498,192) 6,517,145Reserves (a) 1,290,361 498,192 1,788,553Total Equity 8,305,698 - 8,305,698* Reported financial position for the financial year ended 31 December 200434KU’S 110 th ANNUAL REPORT 2005

21. Impacts of Adopting the Australian Equivalents to International FinancialReporting Standards (continued)Effect of A-IFRS on the income statement for the financial year ended 31 December 2004NoteSupersededPolicies*Effect ofTransition toA-IFRSA-IFRS$ $ $Revenue (a) 37,583,541 (498,192) 37,085,349Employee benefits expense (29,094,291) - (29,094,291)Depreciation and amortisation expense (333,950) - (333,950)Repairs and maintenance expense (722,678) - (722,678)Occupancy expense (575,897) - (575,897)Childcare centre expense (4,438,850) - (4,438,850)Other expenses (1,559,384) - (1,559,384)Surplus for the period 858,491 (498,192) 360,299* Reported financial results for the financial year ended 31 December 2004Effect of A-IFRS on the cash flow statement for the financial year ended 31 December 2004There are no material differences between the cash flow statement presented under A-IFRS and the cash flow statementpresented under the superseded policies.NOTES TO THE RECONCILIATIONS OF INCOME AND EQUITYa) Financial InstrumentUnder superseded policies the company measured financial assets designated as available-for-sale at fair value with changes infair value recognised in the surplus for the period. Under A-IFRS available-for-sale assets are measured at fair value with changesin fair value recognised in equity.b) ProvisionsThe classification of long service leave as ‘current’ has become more stringent under A-IFRS. All entitlements in relation toemployees who have been employed for 10 years or greater is to be disclosed as a current provision. From which time anyemployee reaches 10 years of severance (in New South Wales) a legal obligation arises and the corresponding employee benefitbecomes ‘current’.22. Information AND Declarations to be Furnished Under the Charitable FundraisingAct 1991Under this act, KU Children’s Services holds a single authority to fundraise for KU centres. The authority does not extend toservices which KU manages on behalf of another organisation. Preparation of the following information reflects the level ofdisclosure existing in management systems in use by the organisation.a) Statement of Fundraising Income and ExpenditureDetailed income statement for the year ended 31 December 20052005 2004$ $Raffles 48,664 63,028Functions 244,970 242,315Sale of Items 377,489 352,530Interest 2,955 3,642Gross Proceeds from Fundraising 674,079 661,515KU’S 110 th ANNUAL REPORT 200535

22. Information AND Declarations to be Furnished Under the Charitable FundraisingAct 1991 (continued)2005 2004$ $Raffles (606) (3,573)Functions (98,447) (78,623)Sale of Items (228,420) (205,860)Total Cost of Fundraising (327,473) (288,056)Net Proceeds from Fundraising 346,606 373,459b) Accounting Principles and Methods Adopted in Fundraising AccountsThe fundraising financial statements have been prepared on an accrual basis and in accordancewith Australian Accounting Standards as per Note 1.c) Application of Fundraising Proceeds in 2005Opening Balance 741,171 653,938Net proceeds from fundraising 2005 346,606 373,459Centre Improvement and Equipment (231,920) (270,166)Toys (14,484) (12,090)Bank Charges (3,240) (3,970)Total Reserve (Refer Note 13) 838,133 741,171d) Details of Gross Income & Aggregate Express of Appeals Conducted Jointly with TradersFor the purpose of this note all fundraising involving the Sale of Items (e.g. chocolates, sunhats, sunscreen, etc) is deemed to have involved a trader.Gross income received from sale of items 377,489 352,530Total Expenditure Incurred 228,420 205,860e) Forms of Fundraising Appeals Conducted in 2005For the purposes of reporting under the requirements of the Charitable Fundraising Act 1991, KU Children’s Services classifies allfundraising activities under four categories; raffles, functions, sale of items and interest.f) Key Indicators for 2005 Fundraising ActivitiesTotal Cost of Fundraising ($327,473) divided by Gross Income from Fundraising ($674,078) equals 48.6%.Net Surplus from Fundraising ($346,606) divided by Gross Income from Fundraising ($674,078) equals 51.4%.23. ADDITIONAL COMPANY InformationKU Children’s Services is a public company limited by guarantee, incorporated and operating in Australia.Principal Registered Office and Principal Place of Business129 York Street, Sydney NSW 200036KU’S 110 th ANNUAL REPORT 2005

CENTRE ADDRESSESKU Avalon Playtime Pre-school118a Avalon ParadeAvalon NSW 2107Ph: (02) 9918 6583KU Bambara Road Pre-schoolCnr Bambara Rd & Forest WayBelrose NSW 2085Ph: (02) 9451 8622KU Bel Air Pre-school34 Corriston CrescentAdamstown Heights NSW 2289Ph: (02) 4943 1616KU Berowra Pre-school38 Hillcrest RoadBerowra NSW 2081Ph: (02) 9456 2762KU Bligh Park Pre-school4a Alto AvenueNorth Seaforth NSW 2092Ph: (02) 9949 1661KU Blue Mountains MobilePre-schoolNorth Katoomba Primary SchoolCnr Barton and Verdun StsNth Katoomba NSW 2780Ph: (02) 4782 5847KU Briar Cottage Pre-schoolLot 14 Waterhouse PlaceAirds NSW 2560Ph: (02) 4625 7502KU Bulli Pre-school2 Hospital RoadBulli NSW 2516Ph: (02) 4283 2171KU Burnside Pre-school11 Blackwood PlaceOatlands NSW 2117Ph: (02) 9630 5259KU Burwood Pre-school39 Minna StreetBurwood NSW 2134Ph: (02) 9747 4090KU Cammeray Pre-schoolWarwick AvenueGreen ParkCammeray NSW 2062Ph: (02) 9929 8985KU Castlecrag Pre-schoolThe RampartCastlecrag NSW 2068Ph: (02) 9958 5393KU Campbelltown HospitalChildren’s CentreCampbelltown Hospital GroundsTherry RoadCampbelltown NSW 2560Ph: (02) 4620 7522KU Centennial Parklands LongDay Care CentreCnr Anzac Pde & Dacey AvenueKensington NSW 2033Ph: (02) 9663 1200KU Charlestown OccasionalCare Centre1 Frederick StreetCharlestown NSW 2290Ph: (02) 4943 1306KU Chatswood CommunityPre-school9 Victor StreetChatswood NSW 2067Ph: (02) 9419 7173KU Chatswood West Pre-school61 Dalrymple AvenueChatswood NSW 2067Ph: (02) 9419 6250KU Cheltenham Pre-schoolCnr The Promenade &Beecroft RoadCheltenham NSW 2119Ph: (02) 9876 3109KU Chester Hill Children’s Centre157-159 Waldron RoadChester Hill NSW 2162Ph: (02) 9645 1519KU Cobbitty Pre-school296 Cobbitty RoadCobbitty NSW 2570Ph: (02) 4651 2594KU Conjola Place Pre-schoolWalder RoadHammondville NSW 2170Ph: (02) 9825 1195KU Coomaling Mobile Pre-school1) Appin Soccer ClubAppin NSW 25602) St Andrews N/hood CentreStanraer DriveSt Andrews NSW 2566Ph: 0417 280 721KU Corrimal Pre-school78 Murray RoadEast Corrimal NSW 2518Ph: (02) 4283 6233KU Croydon Pre-school6 Railway StreetCroydon NSW 2132Ph: (02) 9798 7750KU Crusader Pre-school53 Malakoff StreetMarrickville NSW 2204Ph: (02) 9569 1940KU CT Lewis Child Care CentreCnr Hill Road & Reilly StreetLurnea NSW 2170Ph: (02) 9607 3561KU Dem School Kids CareOut of School HoursCnr Pacific Hway & Bay RoadNorth Sydney NSW 2060Ph: (02) 9956 8087KU Donkin Pre-schoolDonkin AvenueMoss Vale NSW 2577Ph: (02) 4868 1737KU East Killara Pre-schoolCnr Wentworth & Fairbairn AvEast Killara NSW 2071Ph: (02) 9498 5944KU Eastwood Pre-school4A Rutledge StreetEastwood NSW 2122Ph: (02) 9874 3162KU Fox Valley Pre-school116 Fox Valley WayWahroonga NSW 2076Ph: (02) 9489 1862KU Frances Newton Pre-school222 Palmer StreetDarlinghurst NSW 2010Ph: (02) 9360 4628KU Galston Pre-schoolRear 37 Arcadia RoadGalston NSW 2159Ph: (02) 9653 2252KU Georges Hall Pre-school200 Birdwood RoadGeorges Hall NSW 2198Ph: (02) 9728 1346KU Glenhaven Pre-school76 Glenhaven RoadGlenhaven NSW 2156Ph: (02) 9899 7065KU Grandstand Pre-schoolSt Leonard’s Park74/248 Miller StreetNorth Sydney NSW 2060Ph: (02) 9955 7118KU Greenacre Children’s Centre87 Waterloo RoadGreenacre NSW 2190Ph: (02) 9750 6196KU Greenwich Pre-school46 Greenwich RoadGreenwich NSW 2065Ph: (02) 9906 4402KU Grevillea Pre-school104a Galston RoadHornsby Heights NSW 2077Ph: (02) 9476 2686KU Gwynneville Pre-school22 Berkeley StreetGwynneville NSW 2500Ph: (02) 4229 9917KU Hazelbrook Pre-school48-50 Oaklands RoadHazlebrook NSW 2779Ph: (02) 4758 7888KU Heathcote Pre-school18 Oliver StreetHeathcote NSW 2233Ph: (02) 9520 5402KU Hebersham Pre-schoolLot 21, Howard PlaceHebersham NSW 2770Ph: (02) 9625 8334KU Henson Street Pre-schoolCnr Short & Henson StreetsSummer Hill NSW 2130Ph: (02) 9799 1810KU Isobel Pulsford Pre-school46-48 Bridge StreetEpping NSW 2121Ph: (02) 9876 4420KU James Cahill Pre-school7 Raglan StreetWaterloo NSW 2017Ph: (02) 9319 4346KU John J Carroll Pre-school2 Phelps StreetSurry Hills NSW 2010Ph: (02) 9360 4921KU Karingal Pre-schoolCommunity Centre Halloff Banksia RoadGreenacre NSW 2190Ph: (02) 9759 9354KU Killara Park Pre-schoolSpringdale RoadKillara NSW 2071Ph: (02) 9498 3572KU Killarney Heights Pre-schoolCnr Melwood Avenueand Starkey StreetKillarney Heights NSW 2087Ph: (02) 9452 1571Kintaiba Community ChildCare CentreUniversity of NewcastleUniversity DriveCallaghan NSW 2308Ph: (02) 4967 3475KU’S 110 th ANNUAL REPORT 200537

KU Lance Pre-school andChild Care Centre37 High StreetMillers Point NSW 2000Ph: (02) 9251 9385KU Leichhardt Pre-school8 Prospect StreetLeichhardt NSW 2040Ph: (02) 9569 4549KU Lethbridge Park Pre-schoolLot 274off Apia PlaceLethbridge Park NSW 2770Ph: (02) 9628 9693KU Liverpool MemorialPre-schoolWoodward ParkMemorial AvenueLiverpool NSW 2170Ph: (02) 9602 8028KU Lurnea Out of SchoolHours CareCnr Hill Road & Reilly StreetLurnea NSW 2170Ph: (02) 9607 3561KU Maitland Mobile Children’sResource Unit1) School of Arts Hall(Wednesday)High StreetMorpeth 2321Ph: 02 4933 87772) Tenambit Community Hall(Thursday only)Behind Tenambit ShoppingCentreTenambit 2323Ph: 02 4933 87773) Pat Hughes Community Hall(Tuesday only)Taylor AvenueThornon 2322Ph: 02 4933 87774) Woodberry Community Hall(Friday only)Lawson AvenueWoodberry 2322Ph: (02) 4933 8777KU Macarthur OccasionalCare CentreL4, Macarthur SquareShopping ComplexGilchrist StreetCampbelltown NSW 2560Ph: (02) 4626 3564KU Northern Villages MobilePre-school1) Community HallSydney StreetNew Berrima NSW 2577Ph: 0407 391 3972) Yerrinbool Community HallYerrinbool NSW 2575Ph: 0407 391 397KU Macquarie Park ChildCare Centre27 Ivanhoe PlaceMacquarie Park NSW 2113Ph: (02) 9878 5969KU Macquarie Fields Pre-schoolFlame CrescentMacquarie Fields NSW 2564Ph: (02) 9605 4679KU Maybanke Pre-school99 Harris StreetPyrmont NSW 2009Ph: (02) 9660 1431KU Mayfield Pre-school9 Park StreetMayfield NSW 2304Ph: (02) 4968 1517KU Merewether Pre-school25 Caldwell StreetMerewether NSW 2291Ph: (02) 4963 1590KU Milperra Pre-school12 Amiens AvenueMilperra NSW 2214Ph: (02) 9772 2827KU Mobile 1 Pre-school1) Mt Ku-ring-gaiCommunity HallChurch StreetMt Ku-ring-gai NSW 2080Ph: (02) 9457 89982) Brooklyn Community HallBaden-Powell RoadBrooklyn NSW 2253Ph: (02) 9985 7850KU Mobile 3 Pre-school1) Eagle Vale N/hood CentreEmerald DriveEagle Vale NSW 25582) Progress Association HallCamden RoadDouglas Park NSW 2569Ph: 0409 960 518KU Mosman CommunityPre-school38A Belmont RoadMosman NSW 2088Ph: (02) 9969 3070KU Moss Vale Children’s CentreMann CrescentMoss Vale NSW 2577Ph: (02) 4868 3393KU Newport CommunityPre-school131 Queen’s Parade EastNewport Beach NSW 2106Ph: (02) 9999 4606KU North Ryde Pre-school147-151 Cox’s RoadNorth Ryde NSW 2113Ph: (02) 9878 0254KU Osborne Park Pre-school2 Osborne Placeoff Richardson Street EastLane Cove NSW 2066Ph: (02) 9427 5653KU Padstow Pre-school133 Davies RoadPadstow NSW 2211Ph: (02) 9772 4086KU Peninsula Pre-school60 Pershing PlaceTanilba Bay NSW 2319Ph: (02) 4982 3398KU Penrith Pre-school27 Bringelly RoadKingswood NSW 2747Ph: (02) 4736 5777KU Petersham Pre-school92A Brighton StreetPetersham NSW 2049Ph: (02) 9569 4973KU Peter Pan La PerousePre-school30 Canara AvenueLa Perouse NSW 2036Ph: (02) 9661 5832KU Peter Pan PaddingtonPre-school2 Union StreetPaddington NSW 2021Ph: (02) 9331 3627KU Phillip Park Children’sCentre2-10 Yurong ParkwaySydney NSW 2011Ph: (02) 9380 9099KU Phoenix Pre-school36 Evans StreetBalmain NSW 2041Ph: (02) 9810 2419KU Playstation OccasionalCare CentreCnr Old Belmont Road andOld Pacific HighwayBelmont NSW 2280Ph: (02) 4945 9620KU Randwick/CoogeePre-schoolFrances StreetRandwick NSW 2031Ph: (02) 9398 3982KU Revesby Pre-school123 Sphinx AvenueRevesby NSW 2212Ph: (02) 9771 4942KU Rushcutters Bay Pre-schoolWaratah StreetRushcutters Bay NSW 2011Ph: (02) 9358 5428KU Rydalmere Pre-school89-91 Park RoadRydalmere NSW 2116Ph: (02) 9638 5075KU Saddington StreetCommunity Pre-school1 Saddington StreetTurramurra NSW 2074Ph: (02) 9449 4362KU Shalvey Pre-schoolCnr Sidwell Avenue & HopmanCrescentShalvey NSW 2770Ph: (02) 9628 5583KU Sth Turramurra Pre-school10A Auluba StreetSouth Turramurra NSW 2074Ph: (02) 9144 4172KU St Ives Barra BruiPre-school2A Burraneer AvenueSt Ives NSW 2075Ph: (02) 9449 3110KU Sunbeam Pre-school8 Lyne StreetAlexandria NSW 2015Ph: (02) 9698 1649KU Sutherland Pre-school677 Old Princes HighwaySutherland NSW 2232Ph: (02) 9521 1975KU Swansea Pre-school19-21 Milray StreetSwansea NSW 2281Ph: (02) 4971 1188KU The Chase Pre-school6-8 Babbage RoadRoseville NSW 2069Ph: (02) 9417 3041KU Ultimo Long Day Care Centre249-257 Bulwarra RoadUltimo NSW 2007Ph: (02) 9660 2202KU Village Green Children’sCentre109 Bella Vista DriveBella Vista NSW 2153Ph: (02) 8850 6775KU Wahroonga Pre-school23 Millewa AvenueWahroonga NSW 2076Ph: (02) 9489 4174KU Wentworthville Pre-school26 Water StreetWentworthville NSW 2145Ph: (02) 9636 846138KU’S 110 th ANNUAL REPORT 2005

KU West Merrylands Pre-school102 Betts RoadMerrylands NSW 2160Ph: (02) 9681 2072KU West Pymble Pre-school30 Lofberg RoadWest Pymble NSW 2073Ph: (02) 9498 7285KU Western Mobile Pre-school1) Community HallCnr Carrington & Muscharry StsLondonderry NSW 2753Ph: (02) 4588 63162) Schofields Community HallRailway ParadeSchofields NSW 2762Ph: (02) 9838 1604KU Westmead Pre-school16-18 Hawkesbury RoadWestmead NSW 2145Ph: (02) 9635 7797KU Wickham Pre-school18A Albert StreetWickham NSW 2293Ph: (02) 4961 3304KU Windale Pre-schoolLot 2 South StreetWindale NSW 2306Ph: (02) 4948 8391KU Wombarra Pre-schoolWombarra Community CentreOff Reef RoadWombarra NSW 2512Ph: (02) 4267 3998Wonnayba Child Care CentreUniversity of NewcastleUniversity DriveCallaghan NSW 2308Ph: (02) 4921 6296KU Yagoona Pre-schoolLions Hall425 Hume HighwayYagoona NSW 2199Ph: (02) 9796 8812Centres OperatingUnder ManagementAgreementsAlfred Child Care Centre99 Commercial RoadPrahran VIC 3181Ph: (03) 9207 1099Billabond Children’s Centre30 The Bond30 Hickson RoadMillers Point NSW 2000Ph: (02) 9252 7952Carillon Avenue Child Care CentreCarillon AvenueNewtown NSW 2042Ph: (02) 9557 2344Greenwood Child CareCentreCnr Blue Street and PacificHighwayNorth Sydney NSW 2060Ph: (02) 9957 5806Kira Child Care CentreCnr Moore Park Roadand Oatley RoadPaddington NSW 2021Ph: (02) 9332 4095Kooinda Child Care CentreNewcastle UniversityUniversity DriveCallaghan NSW 2308Ph: (02) 4921 7171Laurel Tree House Child CareCentre61 Arundel StreetGlebe NSW 2037Ph: (02) 9660 8857Loreto OOSHKirribilli Junior School85 Carabella StreetKirribilli NSW 2061Ph: 0409 094 990Ourimbah Pre-school andChildren’s CentreCentral Coast CampusSouth Loop RoadOurimbah NSW 2258Ph: (02) 4362 2933St George Bank Child CareCentre4-16 Montgomery StreetKogarah NSW 2217Ph: (02) 9952 2833Tree Tops Child Care CentreMLC Building105-153 Miller StreetNorth Sydney NSW 2060Ph: (02) 9954 4379Union Child Care CentreUniversity of Sydney72 Lander StreetDarlington NSW 2008Ph: (02) 9351 7878Wattle Lane Children’s Centre30 Wattle LaneUltimo NSW 2007Ph: (02) 9211 1622Willows Child Care CentreCnr Elizabeth Drive andNth Liverpool RoadHeckenburg NSW 2168Ph: (02) 9610 3440Emerald Hill Child CareCentre219 Dorcas StreetSouth Melbourne VIC 3205Ph: (03) 9696 9008AMEP CentresAuburn Child Care Centre3 Mary StreetAuburn NSW 2144Ph: (02) 9749 7926Cabramatta Child Care Centre2 Hughes StreetCabramatta NSW 2166Ph: (02) 9724 3875Fairfield Child Care Centre6-8 Alan StreetFairfield NSW 2165Ph: (02) 9726 5269Liverpool Child Care Centre24-30 Scott StreetLiverpool NSW 2170Ph: 0419 822 724Macquarie Community CollegeChild Care CentreLevel 2125 Main StreetBlacktown NSW 2148Ph: (02) 9621 4536Mt Druitt Child Care CentreCommunity Health CentreBurran StreetMt Druitt NSW 2770Parramatta Child Care Centre3/7 Hassall StreetParramatta NSW 2150Ph: (02) 9893 8856KU SPECIAL PROJECTSKU Learning TogetherProgramsKU James Cahill - LearningTogether7 Raglan StreetWaterloo NSW 2017Ph: (02) 9319 4346KU Macarthur - LearningTogether Program14 Waterhouse PlaceAirds NSW 2560Ph: (02) 4620 0091KU Family ProgramsKU Starting Points - Macarthur14 Waterhouse PlaceAirds NSW 2560Ph: (02) 4620 0091KU Starting Points - MacarthurCobbitty Outreach ServicePolding CentreMater DeiMacquarie Grove DriveCamden NSW 2570Ph: 0418 167 498KU Murrubin Family ProgramFlame CrescentMacquarie Fields NSW 2664Ph: 0409 827156KU Wingecarribee Play and ChatFamily GroupBowral Family Support6 Mount StreetBowral NSW 2576Ph: 0428 419 024Inner West Play and ChatFamily Program“Briarbank”Cnr of Foss and Bridge RoadForest Lodge NSW 2037Ph: (02) 9692 0559Play and Learn9 Park StreetMayfield NSW 2304Ph: (02) 4968 1710KU’S 110 th ANNUAL REPORT 200539

Enriching Children’s Lives“KU Children’s Services” as written by Izaac Sproule from KU Windale Pre-schoolOur core values:• Leading • Nurturing • Dynamic • InspiringKU Children’s ServicesACN 000 006 137 ABN 89 000 006 137129 York Street, Sydney NSW 2000Box Q132, QVB Post Office, Sydney NSW 1230Tel: (02) 9264 8366Fax: (02) 9267 6653E-mail: childrensservices@ku.com.auwww.ku.com.auAuthority Holder under the provisions of Section 16 of the Charitable Fundraising Act 1991. Fundraising Authority No. CFN 10313