2015 Pathways Annual report

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2015 Pathways Annual report

Annual Report 14 / 15


IN MEMORIAM

OUR – OFFICES IAN BURNS

Head Office

61 Pakington Street

Geelong West, Victoria, 3218

P: (03) 5229 8295

E: admin@pathways.org.au

Group Programs

92 Lt Myers Street

Geelong, Victoria, 3220

P: (03) 5229 8295

Youth Connections

105 Yarra Street

Geelong, Victoria, 3220

P: (03) 5246 8208

Pathways Colac

Neighbourhood House

23 Millar Street,

Colac, Victoria, 3250

P: (03) 5232 5210

Youth Health Hub Colac

15 - 17 Hart Street

Colac, Victoria, 3250

P: (03) 5229 8295

Clearwater

Property Care

145 - 147 Victoria Street

North Geelong, Victoria, 3215

P: (03) 5272 3123

www.pathways.org.au

www.clearwater.org.au

/pathwaysgeelong

/clearwaterpropertycare

pathwaysgeelong

cpcgeelong


IN MEMORIAM

– IAN BURNS

Pathways Board Director 1998 – 2015

(Chair 99/00 & 00/01, Vice Chair 01/02 & 02/03, Treasurer 03/04 – 13/14)

With great sadness the Pathways Board,

Executive and Staff acknowledge the

loss of our esteemed and much valued

colleague Ian Burns. Words cannot express

how highly we value Ian’s contribution

to our organisation as Chair, Vice-Chair,

Treasurer and Director over the past 17

years. Pathways reputation is in large

measure due to Ian’s dedication to

advocating on behalf of people with

mental illness.

To honour Ian’s memory and as a mark of

respect for his very significant contribution

to our organisation, we have set up the

Pathways Ian Burns Memorial Award”

to be awarded on an annual basis for

outstanding performance in psychiatric

nursing (as part of the Deakin University

Department of Nursing Awards)

SCHOOL OF NURSING

AND MIDWIFERY

Pathways Ian Burns Memorial Award

ANNUAL STUDENT AWARDS

Awarded to a second year student for outstanding

performance in psychiatric nursing.

Pathways Annual Report 14 / 15 • 1


CHAIR

REPORT

National Disability Insurance Scheme (NDIS)

Pathways has now fully transitioned eligible clients into the NDIS

system. This necessitated a comprehensive re-working of the

business model, workflow processes, and information systems.

The staff of Pathways have responded to these challenges with

admirable commitment and enthusiasm, adapting the service

response to align with the choice and control that service users

now have.

Pathways’ staff have identified issues of concern where

the NDIS have not adequately demonstrated appreciation

for the complex issues experienced by people with high

psychosocial support needs. These issues have been advised

directly to the NDIS through the appropriate forums. Pathways

continues to strongly support the NDIS and will continue to

advocate for improvements as the scheme is rolled out more

comprehensively over the next 2 years.

While transitioning to the NDIS throughout the trial period

Pathways continued to receive the majority of service funding

from the State Government. A surplus was achieved for FY15

and a strong financial position has been maintained with funds

in reserve.

Strategic Plan

During the year the direction of Pathways was re-examined. In

consultation with staff, service users and stakeholders the new

Strategic Plan 2015-17 was developed. This plan focuses on the

following key directions:

1. Expand the offer beyond our existing high quality services to

incorporate broader spectrum mental health and wellbeing

services.

2. Maximise the opportunities to enable every person we

support to fully participate socially and economically as an

equal citizen.

3. Promote our specific capacity to understand and work with

people with multiple and changing needs.

4. Improve and expand the participation and contribution of

people with a lived experience within the organisation.

5. Identify and explore opportunities for alliances and growth

consistent with our values and mission.

6. Demonstrate leadership in mental health awareness and

education activities.

These directions consolidate Pathways’ fundamental service

capacity and expansion of current offerings into new and

complimentary areas of service delivery and consultancy.

Re-Brand

In conjunction with the delivery of the new strategic plan

Pathways’ new brand and logo was established with a launch

held at Geelong’s waterfront Carousel in April. This brand

renewal reflects the need to define Pathways’ position and

strategically raise our profile in this increasingly competitive

market.

The new tag line for the organisation is “Be Spectacular“. This

tag line is bold and optimistic, not just for the people who

access services and supports from Pathways on their road to

recovery, but also for the organisation itself.

New Support Packages

A key change initiated by the NDIS implementation has been the

re-visioning of Pathways supports and services offered in new

support packages that are able to be accessed in flexible ways

to maximise NDIS plan outcomes.

Clearwater Property Care

FY14 saw a turnaround in the performance of Clearwater. This

was further cemented in FY15, with a surplus for the second

year running. The continued growth of this commercial income

stream is significant and has reduced Clearwater’s reliance on

government funding.

Pathways Annual Report 14 / 15 • 2


Pathways CEO

Adrian Buckley served as Pathways CEO for the full financial

year and resigned as at 30 June 2015. The Board wishes to

thank Adrian for his work in leading Pathways during the move

into the NDIA. This was a major transition for the organisation

that was executed extremely professionally and achieved

positive outcomes for Pathways clients.

The Board appointed Phil Dunn as the Acting CEO to serve

during the interim period of selecting and appointing the new

CEO. A rigorous search process has been undertaken to appoint

a permanent CEO. The Board thanks Phil for the excellent work

and support to staff that he has contributed during this interim

period.

Staff & the Board

The Board are to be thanked for their guidance and leadership

during this year. Likewise, Pathways staff have continued to

be resilient in facing major organizational change during the

year whilst maintaining focus on the most important issues for

the people that use Pathways services. The staff of Pathways

continue to be the powerhouse behind the organisation’s

deservedly high reputation.

Philippa Bakes

Chairperson

On 16 October 2015, the board was pleased to announce

that Alyson Miller is to be the new CEO at Pathways.

For the past 6 years, Alyson has been Chief Executive

Officer of On the Line, one of Australia’s leading

providers of remote professional counselling services.

The board is confident that Alyson has the skills and

drive to lead Pathways’ continued development and

growth in the coming months and years.

Pathways Annual Report 14 / 15 • 3


FINANCIALS

Contents

Page

Directors’ Report 5

Auditor’s Independence Declaration 7

Statement of Comprehensive Income 8

Statement of Financial Position 9

Statement of Changes in Equity 10

Statement of Cash Flows 11

Notes to the Financial Statements 12

Directors’ Declaration 32

Independent Audit Report 33

Pathways Annual Report 14 / 15 • 4


DIRECTORS’ REPORT

Your directors present this report on the

company for the financial year ended

30 June 2015.

Directors

The names of each person who has been a director during the

year and to the date of this report are:

Ms Philippa Bakes

Ms Sheridan Salmon

Mr John Stevens

Dr Jane Edwards

Mr Ian Burns

Mr Brent Hewitt

Dr Philip Warelow

Mr Adam Wightman

Mr Barry Allen

Mr Adrian Buckley

Directors have been in office since the start of the financial

year to the date of this report unless otherwise stated.

Principal Activities

The principal activity of the company during the financial year

was to provide rehabilitation, support services and

employment for members of the community with a serious

mental illness.

Our Mission

Mission:

Pathways promotes and facilitates personal recovery and

community integration, in order to improve the quality of life

of people affected by mental health issues.

Vision:

Pathways will be the provider of choice and deliver innovative,

collaborative and highly valued services to the communities

we serve.

Values:

Hope, Innovation, Trust, Support, Acceptance and Respect.

Information On Directors

Ms Philippa Bakes

Qualifications: B.Sc. (Hons)

Mathematics, FCA

Experience

Chair 13/14 & 14/15, Director since 2013

Mr John Stevens

Qualifications

B.App.Sc, Grad.Dip.Bs.Dev.& Org.Dev.,

Dip.Ed Ass.Dip.Gen.Bus.

Experience

Vice-Chair 05/06 – 10/11, 13/14 & 14/15, Director since 2005

Mr Ian Burns

Qualifications

RN, Dip App Sc (Adv Psych Nursing) B.Nursing, M.Nursing

Experience

(Deceased Feb 2015) Chair 99/00 & 00/01, Vice-Chair 01/02 &

02/03, Treasurer 03/04 – present , Director since 1998

Dr Philip Warelow

Qualifications

B.Nursing , M Nursing, PhD, RN, RPsychiatric Nurse

Experience

Director since 1998

Mr Barry Allen

Qualifications

Dip. Management

Experience

Director since 2012

Mr Adrian Buckley

Qualifications

Grad Dip Human Resource Mgt & Services

Experience

(Resigned June 2015) Director since 2013

Mr Adam Wightman

Qualifications

B.Laws(Hons), B.A.(Journalism & IR)

Experience

Director since 2013

Ms Sheridan Salmon

Qualifications

B.Commerce

Experience

Director since 2014

Dr Jane Edwards

Qualifications

BMus, MMus, PhD

Experience

Director since 2014

Mr Brent Hewitt

Qualifications

Grad Dip Chartered Acc, M Prof Acc, Member Inst Chartered

Acc Aus & NZ

Experience

Director since Dec 2014

Pathways Annual Report 14 / 15 • 5


DIRECTORS’ REPORT

Meetings of Directors

During the financial year, 12 meetings of directors were held. Attendances by each director were as follows:

Board of Governance

Meetings

No. eligible to

No.

attend

attended

Audit & Risk Committee

Meetings

No. eligible No.

to attend

attended

Ms Philippa Bakes 12 11 - -

Mr John Stevens 12 9 3 3

Mr Ian Burns 7 2 1 1

Dr Philip Warelow 12 9 - -

Mr Barry Allen 12 12 - -

Mr Adrian Buckley 12 10 3 3

Mr Adam Wightman 12 10 3 2

Ms Sheridan Salmon 12 9 - -

Dr Jane Edwards 12 8 - -

Mr Brent Hewitt 6 6 2 2

Clinical Risk Committee

Meetings

No. eligible to

No.

attend

attended

Marketing & Community

Engagement Committee

Meetings

No. eligible No.

to attend

attended

Ms Philippa Bakes - - - -

Mr John Stevens - - - -

Mr Ian Burns - - - -

Dr Philip Warelow 3 3 - -

Mr Barry Allen - - 4 4

Mr Adrian Buckley 3 3 4 3

Mr Adam Wightman - - - -

Ms Sheridan Salmon - - 4 4

Dr Jane Edwards 3 3 - -

Mr Brent Hewitt - - - -

Pathways Annual Report 14 / 15 • 6


DIRECTORS’ REPORT

The total amount that members of the company are liable to contribute if the company is wound up.

The company is incorporated under the Australian Charities and Not-for-profits Commission Act 2012 and is a company

limited by guarantee. If the company is wound up, the constitution states that each member is required to contribute a

maximum of $50 each towards meeting any outstanding obligations of the entity. At 30 June 2015, the total amount

that members of the company are liable to contribute if the company is wound up is $400 (2014: $500).

Auditor’s Independence Declaration

The lead auditor’s independence declaration for the year ended 30 June 2015 has been received and can be found on

page 6 of the financial report.

Signed in accordance with a resolution of the Board of Directors.

PHILIPPA BAKES | Chairperson

Dated this 21st day of September 2015

JOHN STEVENS | Director

Dated this 21st day of September 2015

Auditor’s Independence Declaration

To The Directors Of Pathways Rehabilitation And Support Services Limited

In accordance with the requirements of section 60-40 of the Australian Charities and Not for Profits Commission Act

2012 for the audit of Pathways Rehabilitation and Support Services Limited for the year ended 30 June 2015, I declare

that, to the best of my knowledge and belief, there have been

i. iNo contraventions of the auditor independence requirements of the Australian Charities and Not for Profits

Commission Act 2012 in relation to the audit; and

ii. No contraventions of any applicable code of professional conduct in relation to the audit

LBW CHARTERED ACCOUNTANTS

SRIPATHY SARMA | Principal

Dated this 21st day of September 2015

Pathways Annual Report 14 / 15 • 7


Statement Of Profit Or Loss And Other

Comprehensive Income for The Year Ended

30 June 2015

Note 2015 2014

REVENUE

$ $

Revenue 2 5,579,745 6,449,496

Other income 2 29,301 (206,170)

EXPENSES

Employee benefits expense (3,577,333) (3,796,707)

Clearwater funded employees wages and on-costs (379,404) (398,859)

Clearwater cost of sales (41,090) (90,752)

Premises expenses (274,855) (300,999)

Telephone and communication (71,153) (80,532)

Equipment expenses (39,434) (45,982)

Depreciation and amortisation (58,413) (92,176)

Office and associated supplies (79,847) (122,084)

Outside services (357,176) (514,033)

Rehabilitation program expenses (69,466) (173,905)

Vehicle expenses (329,245) (328,461)

Travel expenses (6,831) (9,714)

Finance costs 3 (7,456) (9,043)

Doubtful debt expenses 3 - 1,535

Net increase/(decrease) in fair value of financial assets (5,710) 71,208

Other expenses - (19,335)

Current year surplus before income tax 311,633 333,487

Tax expense - -

Net current year surplus 311,633 333,487

Other comprehensive income

Items that will not be reclassified subsequently to profit or loss: - -

Items that will be reclassified subsequently to profit or loss when specific

conditions are met: - -

Total other comprehensive income for the year - -

Total comprehensive income for the year 311,633 333,487

Total comprehensive income attributable to members of the entity 311,633 333,487

The accompanying notes form part of these financial statements.

Pathways Annual Report 14 / 15 • 8


Statement Of Financial Position

As At 30 June 2015

Note 2015 2014

CURRENT ASSETS

$ $

Cash on hand 4 2,165,534 2,131,993

Accounts receivable and other debtors 5 71,238 43,620

Other current assets 6 81,135 4,580

Financial assets 7 519,859 525,569

TOTAL CURRENT ASSETS 2,837,766 2,705,762

NON-CURRENT ASSETS

Property, plant and equipment 8 110,755 168,441

Intangibles 9 559 1,286

TOTAL NON-CURRENT ASSETS 111,314 169,727

TOTAL ASSETS 2,949,080 2,875,489

CURRENT LIABILITIES

Accounts payable and other payables 10 326,148 615,728

Employee provisions 11 401,625 374,515

TOTAL CURRENT LIABILITIES 727,773 990,243

NON-CURRENT LIABILITIES

Employee provisions 11 52,933 28,505

TOTAL NON-CURRENT LIABILITIES 52,933 28,505

TOTAL LIABILITIES 780,706 1,018,748

NET ASSETS 2,168,374 1,856,741

EQUITY

Retained surplus 2,168,374 1,856,741

TOTAL EQUITY 2,168,374 1,856,741

The accompanying notes form part of these financial statements.

Pathways Annual Report 14 / 15 • 9


Statement Of Changes In Equity

For The Year Ended 30 June 2015

Retained

Earnings

Total Equity

$ $

BALANCE AT 1 JULY 2013 1,523,254 1,523,254

Comprehensive income

Surplus for the year attributable to members of the entity 333,487 333,487

Other comprehensive income for the year - -

Total comprehensive income attributable to members of the entity 333,487 333,487

BALANCE AT 30 JUNE 2014 1,856,741 1,856,741

Comprehensive income

Surplus for the year attributable to members of the entity 311,633 311,633

Other comprehensive income for the year - -

Total comprehensive income attributable to members of the entity - -

BALANCE AT 30 JUNE 2015 2,168,374 2,168,374

The accompanying notes form part of these financial statements.

Pathways Annual Report 14 / 15 • 10


Statement Of Cash Flows For The Year

Ended 30 June 2015

Note 2015 2014

$ $

CASH FLOWS FROM OPERATING ACTIVITIES

Receipts from grants and sales 5,380,060 6,561,963

Other receipts 29,301 60,906

Payments to suppliers and employees (5,471,332) (5,761,423)

Interest received 63,439 54,968

Dividends received 32,073 26,914

Net cash generated from operating activities 16 33,541 943,328

CASH FLOWS FROM INVESTING ACTIVITIES

Proceeds from sale of property, plant and equipment - 17,700

Payment for property, plant and equipment - (66,709)

Net cash used in investing activities - (49,009)

CASH FLOWS FROM FINANCING ACTIVITIES

Net cash used in financing activities - -

Net increase in cash held 33,541 894,319

Cash on hand at beginning of the financial year 2,131,993 1,237,674

Cash on hand at end of the financial year 4 2,165,534 2,131,993

The accompanying notes form part of these financial statements.

Pathways Annual Report 14 / 15 • 11


Notes To The Financial Statements For

The Year Ended 30 June 2015

Note 1: Summary Of Significant Accounting

Policies

The financial statements cover Pathways Rehabilitation and

Support Services Limited as an individual entity, incorporated

and domiciled in Australia. This report is prepared in order to

satisfy the financial reporting requirements of the Australian

Charities and Not-for-profits Commission Act 2012 Pathways

Rehabilitation and Support Services Limited is a company

limited by guarantee.

The financial statements were authorised for issue on 21

September 2015 by the directors of the company.

Basis of Preparation

These general purpose financial statements have been

prepared in accordance with the Australian Charities and

Not-for-profits Commission Act 2012 and Australian

Accounting Standards and Interpretations of the Australian

Accounting Standards Board. The company is a not-for-profit

entity for financial reporting purposes under Australian

Accounting Standards. Material accounting policies adopted in

the preparation of these financial statements are presented

below and have been consistently applied unless stated

otherwise.

The financial statements, except for the cash flow information,

have been prepared on an accruals basis and are based on

historical costs, modified, where applicable, by the

measurement at fair value of selected non-current assets,

financial assets and financial liabilities. The amounts presented

in the financial statements have been rounded to the nearest

dollar.

Accounting Policies

a. Revenue

Non-reciprocal grant revenue is recognised in profit or loss

when the entity obtains control of the grant and it is

probable that the economic benefits gained from the grant

will flow to the entity and the amount of the grant can be

measured reliably.

If conditions are attached to the grant which must be

satisfied before it is eligible to receive the contribution, the

recognition of the grant as revenue will be deferred until

those conditions are satisfied.

When grant revenue is received whereby the entity incurs

an obligation to deliver economic value directly back to the

contributor, this is considered a reciprocal transaction and

the grant revenue is recognised in the state of financial

position as a liability until the service has been delivered to

the contributor, otherwise the grant is recognised as income

on receipt.

Donations and bequests are recognised as revenue when

received.

Interest revenue is recognised using the effective interest

method, which for floating rate financial assets is the rate

inherent in the instrument. Dividend revenue is recognised

when the right to receive a dividend has been established.

Revenue from the rendering of a service is recognised upon

the delivery of the service to the customer.

All revenue is stated net of the amount of goods and

services tax (GST).

b. Inventories on Hand

Inventories are measured at the lower of cost and current

replacement cost.

Inventories acquired at no cost or for nominal consideration

are measured at the current replacement cost as at the date

of acquisition.

c. Fair Value of Assets and Liabilities

The company measures some of its assets and liabilities at

fair value on either a recurring or non-recurring basis,

depending on the requirements of the applicable

Accounting Standard.

Fair value is the price the company would receive to sell an

asset or would have to pay to transfer a liability in an

orderly (ie unforced) transaction between independent,

knowledgeable and willing market participants at the

measurement date.

As fair value is a market-based measure, the closest

equivalent observable market pricing information is used to

determine fair value. Adjustments to market values may be

made having regard to the characteristics of the specific

asset or liability. The fair values of assets and liabilities that

are not traded in an active market are determined using one

or more valuation techniques. These valuation techniques

maximise, to the extent possible, the use of observable

market data.

To the extent possible, market information is extracted from

either the principal market for the asset or liability (ie the

market with the greatest volume and level of activity for the

asset or liability) or, in the absence of such a market, the

most advantageous market available to the entity at the

end of the reporting period (ie the market that maximises

the receipts from the sale of the asset or minimises the

payments made to transfer the liability, after taking into

account transaction costs and transport costs).

For non-financial assets, the fair value measurement also

takes into account a market participant’s ability to use the

asset in its highest and best use or to sell it to another

market participant that would use the asset in its highest

and best use.

The fair value of liabilities and the entity’s own equity

instruments (excluding those related to share-based

payment arrangements) may be valued, where there is no

observable market price in relation to the transfer of such

financial instruments, by reference to observable market

information where such instruments are held as assets.

Where this information is not available, other valuation

techniques are adopted and, where significant, are detailed

in the respective note to the financial statements.

Pathways Annual Report 14 / 15 • 12


d. Property, Plant and Equipment

Each class of property, plant and equipment is carried at

cost or fair value as indicated, less, where applicable,

accumulated depreciation and any impairment losses.

Plant and equipment

Plant and equipment are measured on the cost basis and

are therefore carried at cost less accumulated depreciation

and any accumulated impairment losses. In the event the

carrying amount of plant and equipment is greater than the

estimated recoverable amount, the carrying amount is

written down immediately to the estimated recoverable

amount and impairment losses are recognised either in

profit or loss or as a revaluation decrease if the impairment

losses relate to a revalued asset. A formal assessment of

recoverable amount is made when impairment indicators

are present (refer to Note 1(g) for details of impairment).

Subsequent costs are included in the asset’s carrying

amount or recognised as a separate asset, as appropriate,

only when it is probable that future economic benefits

associated with the item will flow to the company and the

cost of the item can be measured reliably. All other repairs

and maintenance are recognised as expenses in profit or

loss in the financial period in which they are incurred.

Plant and equipment that have been contributed at no cost

or for nominal cost are recognised at the fair value of the

asset at the date it is acquired.

Depreciation

The depreciable amount of all fixed assets, including

buildings and capitalised lease assets, but excluding

freehold land, is depreciated on a straight-line basis over

the asset’s useful life to the entity commencing from the

time the asset is available for use. Leasehold improvements

are depreciated over the shorter of either the unexpired

period of the lease or the estimated useful lives of the

improvements.

The depreciation rates used for each class of depreciable

assets are:

Class of Fixed Asset

Depreciation Rate

Office equipment 20% - 100%

Furniture, fittings and equipment 10% - 20%

Leasehold improvements 15% - 20%

Rehabilitation program assets 15% - 50%

The assets’ residual values and useful lives are reviewed and

adjusted, if appropriate, at the end of each reporting period.

Gains and losses on disposals are determined by comparing

proceeds with the carrying amount. These gains or losses

are recognised in profit or loss in the period in which they

arise. When revalued assets are sold, amounts included in

the revaluation surplus relating to that asset are transferred

to retained surplus.

e. Leases

substantially all the risks and benefits incidental to the

ownership of the asset but not the legal ownership are

transferred to the entity, are classified as finance leases.

Finance leases are capitalised, recognising an asset and a

liability equal to the present value of the minimum lease

payments, including any guaranteed residual values.

Leased assets are depreciated on a straight-line basis over

their estimated useful lives where it is likely that the entity

will obtain ownership of the asset. Lease payments are

allocated between the reduction of the lease liability and

the lease interest expense for the period.

Lease payments for operating leases, where substantially all

the risks and benefits remain with the lessor, are recognised

as expenses on a straight-line basis over the lease term.

Lease incentives under operating leases are recognised as a

liability and amortised on a straight-line basis over the life

of the lease term.

f. Financial Instruments

Initial recognition and measurement

Financial assets and financial liabilities are recognised when

the entity becomes a party to the contractual provisions to

the instrument. For financial assets, this is equivalent to the

date that the company commits itself to either purchase or

sell the asset (ie trade date accounting is adopted).

Financial instruments are initially measured at fair value plus

transaction costs except where the instrument is classified

“at fair value through profit or loss”, in which case

transaction costs are recognised as expenses in profit or

loss immediately.

Classification and subsequent measurement

Financial instruments are subsequently measured at fair

value, amortised cost using the effective interest method, or

cost. Where available, quoted prices in an active market are

used to determine fair value. In other circumstances,

valuation techniques are adopted.

Amortised cost is calculated as the amount at which the

financial asset or financial liability is measured at initial

recognition less principal repayments and any reduction for

impairment, and adjusted for any cumulative amortisation

of the difference between that initial amount and the

maturity amount calculated using the effective interest

method.

The effective interest method is used to allocate interest

income or interest expense over the relevant period and is

equivalent to the rate that exactly discounts estimated

future cash payments or receipts (including fees,

transaction costs and other premiums or discounts) through

the expected life (or when this cannot be reliably predicted,

the contractual term) of the financial instrument to the net

carrying amount of the financial asset or financial liability.

Revisions to expected future net cash flows will necessitate

an adjustment to the carrying amount with a consequential

recognition of an income or expense item in profit or loss.

Leases of property, plant and equipment, where

Pathways Annual Report 14 / 15 • 13


(i)

Financial assets at fair value through profit or loss

Impairment

Financial assets are classified at “fair value through profit

or loss” when they are either held for trading for the

purpose of short-term profit taking, derivatives not held

for hedging purposes, or when they are designated as

such to avoid an accounting mismatch or to enable

performance evaluation where a group of financial assets

is managed by key management personnel on a fair value

basis in accordance with a documented risk management

or investment strategy. Such assets are subsequently

measured at fair value with changes in carrying amount

being included in profit or loss.

(ii) Loans and receivables

Loans and receivables are non-derivative financial assets

with fixed or determinable payments that are not quoted

in an active market and are subsequently measured at

amortised cost. Gains or losses are recognised in profit or

loss through the amortisation process and when the

financial asset is derecognised.

(iii) Held-to-maturity investments

Held-to-maturity investments are non-derivative financial

assets that have fixed maturities and fixed or determinable

payments, and it is the company’s intention to hold these

investments to maturity. They are subsequently measured

at amortised cost. Gains or losses are recognised in profit

or loss through the amortisation process and when the

financial asset is derecognised.

(iv) Available-for-sale investments

Available-for-sale investments are non-derivative financial

assets that are either not capable of being classified into

other categories of financial assets due to their nature or

they are designated as such by management. They

comprise investments in the equity of other entities where

there is neither a fixed maturity nor fixed or determinable

payments.

They are subsequently measured at fair value with any

remeasurements other than impairment losses and foreign

exchange gains and losses recognised in other

comprehensive income. When the financial asset is

derecognised, the cumulative gain or loss pertaining to

that asset previously recognised in other comprehensive

income is reclassified into profit or loss.

Available-for-sale financial assets are classified as

non-current assets when they are not expected to be sold

within 12 months after the end of the reporting period. All

other available-for-sale financial assets are classified as

current assets.

(v) Financial liabilities

Non-derivative financial liabilities other than financial

guarantees are subsequently measured at amortised cost.

Gains or losses are recognised in profit or loss through the

amortisation process and when the financial liability is

derecognised.

At the end of each reporting period, the company assesses

whether there is objective evidence that a financial asset

has been impaired. A financial asset or a group of financial

assets will be deemed to be impaired if, and only if, there is

objective evidence of impairment as a result of the

occurrence of one or more events (a “loss event”), which

has an impact on the estimated future cash flows of the

financial asset(s).

In the case of available-for-sale financial assets, a significant

or prolonged decline in the market value of the instrument

is considered a loss event. Impairment losses are recognised

in profit or loss immediately. Also, any cumulative decline in

fair value previously recognised in other comprehensive

income is reclassified into profit or loss at this point.

In the case of financial assets carried at amortised cost, loss

events may include: indications that the debtors, or a group

of debtors, are experiencing significant financial difficulty,

default or delinquency in interest or principal payments;

indications that they will enter into bankruptcy or other

financial reorganisation; and changes in arrears or economic

conditions that correlate with defaults.

For financial assets carried at amortised cost (including

loans and receivables), a separate allowance account is

used to reduce the carrying amount of financial assets

impaired by credit losses. After having undertaken all

possible measures of recovery, if the management

establishes that the carrying amount cannot be recovered

by any means, at that point the written-off amounts are

charged to the allowance account or the carrying amount

of impaired financial assets is reduced directly if no

impairment amount was previously recognised in the

allowance accounts.

When the terms of financial assets that would otherwise

have been past due or impaired have been renegotiated,

the company recognises the impairment for such financial

assets by taking into account the original terms as if the

terms have not been renegotiated so that the loss events

that have occurred are duly considered.

Derecognition

Financial assets are derecognised where the contractual

rights to receipt of cash flows expire or the asset is

transferred to another party whereby the entity no longer

has any significant continuing involvement in the risks and

benefits associated with the asset. Financial liabilities are

derecognised where the related obligations are discharged,

cancelled or have expired. The difference between the

carrying amount of the financial liability, which is

extinguished or transferred to another party and the fair

value of consideration paid, including the transfer of

non-cash assets or liabilities assumed, is recognised in profit

or loss.

Pathways Annual Report 14 / 15 • 14


g. Impairment of Assets

At the end of each reporting period, the entity reviews the

carrying amounts of its tangible and intangible assets to

determine whether there is any indication that those assets

have been impaired. If such an indication exists, the

recoverable amount of the asset, being the higher of the

asset’s fair value less costs to sell and value in use, is

compared to the asset’s carrying amount. Any excess of the

asset’s carrying amount over its recoverable amount is

recognised in profit or loss.

Where the future economic benefits of the asset are not

primarily dependent upon the asset’s ability to generate net

cash inflows and when the entity would, if deprived of the

asset, replace its remaining future economic benefits, value

in use is determined as the depreciated replacement cost of

an asset.

Where it is not possible to estimate the recoverable amount

of an asset’s class, the entity estimates the recoverable

amount of the cash-generating unit to which the class of

assets belong.

Where an impairment loss on a revalued asset is identified,

this is recognised against the revaluation surplus in respect

of the same class of asset to the extent that the impairment

loss does not exceed the amount in the revaluation surplus

for that class of asset.

h. Employee Provisions

Short-term employee provisions

Provision is made for the company’s obligation for shortterm

employee benefits. Short-term employee benefits are

benefits (other than termination benefits) that are expected

to be settled wholly before 12 months after the end of the

annual reporting period in which the employees render the

related service, including wages, salaries and sick leave.

Short-term employee benefits are measured at the

(undiscounted) amounts expected to be paid when the

obligation is settled.

Other long-term employee provisions

Provision is made for employees’ long service leave and

annual leave entitlements not expected to be settled wholly

within 12 months after the end of the annual reporting

period in which the employees render the related service.

Other long-term employee benefits are measured at the

present value of the expected future payments to be made

to employees. Expected future payments incorporate

anticipated future wage and salary levels, durations of

service and employee departures, and are discounted at

rates determined by reference to market yields at the end

of the reporting period on government bonds that have

maturity dates that approximate the terms of the

obligations. Upon the remeasurement of obligations for

other long-term employee benefits, the net change in the

obligation is recognised in profit or loss as a part of

employee benefits expense.

does not have an unconditional right to defer settlement for

at least 12 months after the end of the reporting period, in

which case the obligations are presented as current

provisions.

i. Cash on Hand

Cash on hand includes cash on hand, deposits held at-call

with banks, other short-term highly liquid investments with

original maturities of three months or less, and bank

overdrafts. Bank overdrafts are shown within short-term

borrowings in current liabilities on the statement of financial

position.

j. Accounts Receivable and Other Debtors

Accounts receivable and other debtors include amounts

due from members as well as amounts receivable from

customers for goods sold in the ordinary course of

business. Receivables expected to be collected within 12

months of the end of the reporting period are classified as

current assets. All other receivables are classified as

non-current assets.

Accounts receivable are initially recognised at fair value and

subsequently measured at amortised cost using the

effective interest method, less any provision for impairment.

Refer to Note 1(f) for further discussion on the

determination of impairment losses.

k. Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of the

amount of GST, except where the amount of GST incurred is

not recoverable from the Australian Taxation Office (ATO).

l. Income tax

No provision for income tax has been raised as the entity is

exempt from income tax under Div 50 of the Income Tax

Assessment Act 1997.

m. Intangibles

Software

Software is recorded at cost. It has a finite life and is carried

at cost less accumulated amortisation and any impairment

losses. Software has an estimated useful life of between one

and three years. It is assessed annually for impairment.

License Fee

License Fee is recorded at cost. The License Fee is in

respect of a three year period and will be amortised over

the period commencing from 1 July 2012. The carrying

balance will be assessed annually for impairment

The company’s obligations for long-term employee benefits

are presented as non-current employee provisions in its

statement of financial position, except where the company

Pathways Annual Report 14 / 15 • 15


n. Provisions

Provisions are recognised when the entity has a legal or

constructive obligation, as a result of past events, for which

it is probable that an outflow of economic benefits will

result and that outflow can be reliably measured. Provisions

recognised represent the best estimate of the amounts

required to settle the obligation at the end of the reporting

period.

o. Comparative Figures

Where required by Accounting Standards, comparative

figures have been adjusted to conform with changes in

presentation for the current financial year.

When the company retrospectively applies an accounting

policy, makes a retrospective restatement or reclassifies

items in its financial statements, a third statement of

financial position as at the beginning of the preceding

comparative period, in addition to the minimum

comparative financial statements, must be disclosed.

q. Critical Accounting Estimates and Judgments

The directors evaluate estimates and judgments

incorporated into the financial statements based on

historical knowledge and best available current information.

Estimates assume a reasonable expectation of future events

and are based on current trends and economic data,

obtained both externally and within the company.

r. New Accounting Standards for Application in Future

Periods

The AASB has issued a number of new and amended

Accounting Standards and Interpretations that have

mandatory application dates for future reporting periods,

some of which are relevant to the company. The company

has decided not to early adopt any of the new and

amended pronouncements.

p. Accounts Payable and Other Payables

Trade and other payables represent the liability outstanding

at the end of the reporting period for goods and services

received by the company during the reporting period which

remain unpaid. The balance is recognised as a current

liability with the amounts normally paid within 30 days of

recognition of the liability.

Pathways Annual Report 14 / 15 • 16


Note 2:

Revenue And Other Income

2015 2014

$ $

REVENUE

Revenue from government grants and other grants:

- State Government Revenue 3,459,511 3,709,986

- Department of Social Services 842,064 1,288,972

- National Disability Insurance Scheme 386,170 -

- Give Where You Live 30,000 -

- Barwon Health 36,986 329,022

- Disability Services Queensland - 1,174

- DEEDI - (24,988)

- FCEP - 10,877

- ACFE 2,500 26,749

- Salvation Army 38,919 84,992

- State Trustees 1,494 4,909

4,797,644 5,431,693

OTHER REVENUE:

- Clearwater Business Services Income 482,920 347,759

- MadCap Café sales - 140,252

- Training and Support Services Income 156,681 387,503

- Dividends received 32,073 26,914

- Interest Received 63,439 54,968

- Sundry Income 46,988 60,407

782,101 1,017,803

Total Revenue 5,579,745 6,449,496

OTHER INCOME

- (Loss) / Gain on disposal of property, plant and equipment - (236,393)

- Rental income 29,301 30,223

Total other income 29,301 (206,170)

Total revenue and other income 5,609,046 6,243,326

Pathways Annual Report 14 / 15 • 17


Note 3:

Surplus For The Year

2015 2014

$ $

A. EXPENSES

Bad and doubtful debts expense - (1,535)

Finance Costs 7,456 9,043

Rental expense on operating leases:

– Minimum lease payment 380,302 400,476

Audit Remuneration

- Audit services 15,000 15,000

Note 4:

Cash And Cash Equivalents

2015 2014

$ $

CURRENT

Cash at bank and on hand 2,165,534 2,131,993

Total cash on hand as stated in the statement of

financial position and statement of cash flows 2,165,534 2,131,993

Note 5:

Trade And Other Receivables

2015 2014

$ $

CURRENT

Accounts receivable 72,674 45,056

Provision for doubtful debts (1,436) (1,436)

Total current accounts receivable and other debtors 71,238 43,620

Pathways Annual Report 14 / 15 • 18


Note 5:

Trade And Other Receivables

(Continued)

a. Provision for Doubtful Debts

Current trade receivables are generally on 30-day terms.

These receivables are assessed for recoverability and a

provision for impairment is recognised when there is

objective evidence that an individual trade receivable is

impaired. These amounts are impaired at reporting date.

b. Credit Risk – Trade and Other Receivables

The company has no significant concentration of credit risk

with respect to any single counterparty or group of

counterparties other than those receivables specifically

provided for and mentioned within Note 5. The main source

of credit risk to the company is considered to relate to the

class of assets described as “accounts receivable and other

debtors”.

The following table details the company’s trade and other

debtors exposed to credit risk (prior to collateral and other

credit enhancements) with ageing analysis and impairment

provided for thereon. Amounts are considered as “past due”

when the debt has not been settled within the terms and

conditions agreed between the company and the customer or

counterparty to the transaction. Receivables that are past due

are assessed for impairment by ascertaining solvency of the

debtors and are provided for where there are specific

circumstances indicating that the debt may not be fully repaid

to the company.

The balances of receivables that remain within initial trade

terms (as detailed in the table below) are considered to be of

high credit quality.

2015

Gross

Amount

Past

Past Due but Not Impaired (Days Overdue)

Due and

Impaired < 30 31 - 60 61 - 90 > 90

Within Initial

Trade Terms

$ $ $ $ $ $ $

Account receivable 72,674 1,436 - 18,853 9,357 2,637 40,391

Total 72,674 1,436 - 18,853 9,357 2,637 40,391

2014

Account receivable 45,056 1,436 - 14,926 6,113 (6,773) 29,354

Total 45,056 1,436 - 14,926 6,113 (5,335) 29,354

Pathways Annual Report 14 / 15 • 19


Note 6:

Other Current Assets

2015 2014

$ $

Prepayments 36,802 4,580

Accrued income 44,333 -

Total 81,135 4,580

Note 7:

Financial Assets

CURRENT

Financial assets at fair value through profit or loss:

- Investments in Australian listed shares, held for trading 519,859 525,569

Total 519,859 525,569

Note 8:

Property, Plant and Equipment

2015 2014

$ $

Office equipment at cost 384,617 384,617

Less accumulated depreciation (354,070) (333,227)

30,547 51,390

Leasehold improvements at cost 219,773 219,773

Less accumulated depreciation (185,917) (166,697)

33,856 53,076

Rehabilitation program assets at cost 188,131 188,131

Less accumulated depreciation (161,241) (151,258)

26,890 36,873

Furniture, fittings & equipment at cost 99,422 99,422

Less accumulated depreciation (79,960) (72,320)

19,462 27,102

Total property, plant and equipment 110,755 168,441

Pathways Annual Report 14 / 15 • 20


Note 8:

Property, Plant and Equipment

(Continued)

Movements in Carrying Amounts

Movement in the carrying amounts for each class of property, plant and equipment between the beginning and the end of the

current financial year:

Office Leasehold Rehab Furniture &

TOTAL

Equipment Improvements Program Fittings

$ $ $ $ $

2014

Balance at the beginning of the year 41,421 292,230 61,049 28,964 423,664

Additions at cost 32,680 8,180 13,273 12,576 66,709

Disposals (1,565) (209,726) (23,455) (5,433) (240,179)

Depreciation expense (21,146) (37,608) (13,994) (9,005) (81,753)

Carrying amount at the end of the year 51,390 53,076 36,873 27,102 168,441

2015

Balance at the beginning of the year 51,390 53,076 36,873 27,102 168,441

Additions at cost - - - - -

Disposals - - - - -

Depreciation expense (20,843) (19,220) (9,983) (7,640) (57,686)

Carrying amount at the end of the year 30,547 33,856 26,890 19,462 110,755

Note 9:

Intangibles

2015 2014

$ $

Software Assets at cost 142,865 142,865

Less accumulated amortisation (142,306) (141,579)

559 1,286

Franchise fees at cost - -

Less accumulated amortisation - -

- -

Total Intangibles 559 1,286

Pathways Annual Report 14 / 15 • 21


Note 9:

Intangibles

(Continued)

Computer

Software

Franchisee

Fees

TOTAL

$ $ $

2014

Balance at the beginning of the year 10,053 15,564 25,617

Additions - - -

Disposals (2,660) (11,035) (13,695)

Amortisation expense (6,107) (4,529) (10,636)

Impairment losses - - -

1,286 - 1,286

2015

Balance at the beginning of the year 1,286 - 1,286

Additions - - -

Disposals - - -

Amortisation expense (727) - (727)

Impairment losses - - -

559 - 559

Note 10:

Accounts Payable And Other Payables

2015 2014

$ $

CURRENT

Accounts payable 81,531 74,549

Accrued expenses 50,352 213,759

Payroll liabilities 88,022 65,938

Deferred grant income 42,835 154,960

GST payable 63,408 106,522

326,148 615,728

Pathways Annual Report 14 / 15 • 22


Note 11:

Employee Provisions

Employee Provisions

$

Opening Balance at 1 July 2014 403,020

Additional provisions raised during the year 324,530

Amounts used (272,992)

Balance at 30 June 2015 454,558

2015 2014

Analysis of Employee Provisions $ $

Current:

- Annual leave entitlements 218,450 207,022

- Long service leave entitlements 144,071 167,493

- Other employee provisions 39,104 -

Total current employee provisions 401,625 374,515

Non-current:

- Long service leave entitlements 52,933 28,505

454,558 403,020

Employee Provisions

Employee provisions represent amounts accrued for annual

leave and long service leave.

The current portion for this provision includes the total

amount accrued for annual leave entitlements and the

amounts accrued for long service leave entitlements that have

vested due to employees having completed the required

period of service. Based on past experience, the company

does not expect the full amount of annual leave or long

service leave balances classified as current liabilities to be

settled within the next 12 months. However, these amounts

must be classified as current liabilities since the company does

not have an unconditional right to defer the settlement of

these amounts in the event employees wish to use their leave

entitlement.

The non-current portion for this provision includes amounts

accrued for long service leave entitlements that have not yet

vested in relation to those employees who have not yet

completed the required period of service.

Pathways Annual Report 14 / 15 • 23


Note 12:

Capital And Leasing Commitments

2015 2014

$ $

a. Finance Lease Commitments

Payable – minimum lease payments:

– Not later than 12 months - -

– Later than 12 months but not later than five years - -

– Later than five years - -

Minimum lease payments - -

Less future finance charges - -

Present value of minimum lease payments - -

b. Operating Lease Commitments

Non-cancellable operating leases contracted for but not capitalised

in the financial statements

Payable – minimum lease payments:

– Not later than 12 months 246,928 275,529

– Later than 12 months but not later than five years 167,849 141,010

– Later than five years - -

414,777 416,539

Note 13:

Economic Dependence

Pathways Rehabilitation and Support Services Limited is dependent on the State and Federal Government funding for the majority

of its revenue used to operate the business. At the date of this report the Board of Directors has no reason to believe the

Government will not continue to support Pathways Rehabilitation and Support Services Limited

Note 14:

Events After The Reporting Period

The directors are not aware of any significant events since the end of the reporting period.

Pathways Annual Report 14 / 15 • 24


Note 15:

Related Party Transactions

2015 2014

$ $

a. KEY MANAGEMENT PERSONNEL

Any person(s) having authority and responsibility for planning, directing and

controlling the activities of the company, directly or indirectly, including any director

(whether executive or otherwise) is considered key management personnel.

Key management personnel compensation:

– Short-term benefits 460,506 405,448

460,506 405,448

Apart from the details disclosed above, no key management personnel has entered into a material contract with the company and

there were no material contract involving key management personnel’s interests exiting at year end. Key management personnel

include the Executives and Directors of the Company.

Note 16:

Cash Flow Information

2015 2014

$ $

Reconciliation of Cash Flow from Operating Activities with

Current Year Surplus 311,633 333,487

PROFIT AFTER INCOME TAX

Non-cash flows: 58,413 92,176

- Depreciation and amortisation expense 5,710 (71,208)

- Net change in fair value of financial assets - 236,393

- (Gains)/Loss on disposal of property, plant and equipment - (1,535)

- Doubtful debts expense

Changes in assets and liabilities:

- (Increase)/decrease in trade and other receivables (27,618) 183,988

- Increase/(decrease) in trade and other payables (289,580) 13,737

- (Increase)/decrease in prepayments (76,555) 35,121

- Increase/(decrease) in employee provisions 51,538 115,154

- (Increase)/decrease in inventories on hand - 6,015

33,541 943,328

Pathways Annual Report 14 / 15 • 25


Note 17:

Financial Risk Management

The company’s financial instruments consist mainly of deposits with banks, local money market instruments, short-term and

long-term investments, receivables and payables, and lease liabilities.

The carrying amounts for each category of financial instruments, measured in accordance with AASB 139 as detailed in the

accounting policies to these financial statements, are as follows:

Note 2015 2014

$ $

FINANCIAL ASSETS

Cash on hand 4 2,165,534 2,131,993

Accounts receivable and other debtors 5 71,238 43,620

Financial assets at fair value through profit or loss 7 519,859 525,569

Total financial assets 2,756,631 2,701,182

FINANCIAL LIABILITIES

Financial liabilities at amortised cost

Accounts payable and other payables 10 326,148 615,728

Total financial liabilities 326,148 615,728

Pathways Annual Report 14 / 15 • 26


Note 17:

Financial Risk Management

(Continued)

Financial Risk Management Policies

The audit and risk committee consists of senior committee

members and the committee’s overall risk management

strategy is to assist the company in meeting its financial

targets while minimising potential adverse effects on financial

performance. Risk management policies are approved and

reviewed by the audit and risk committee on a regular basis.

These include credit risk policies and future cash flow

requirements.

Specific Financial Risk Exposures and Management

The main risks the company is exposed to through its financial

instruments are credit risk, liquidity risk and market risk

relating to interest rate risk and other price risk.

There have been no substantive changes in the types of risks

the company is exposed to, how these risks arise, or the

board’s objectives, policies and processes for managing or

measuring the risks from the previous period.

a. Credit risk

Exposure to credit risk relating to financial assets arises from

the potential non-performance by counterparties of contract

obligations that could lead to a financial loss for the company.

The major source of revenue is expected to be received from

the National Disability Insurance Scheme (NDIS).

Credit risk exposures

The maximum exposure to credit risk by class of recognised

financial assets at the end of the reporting period is equivalent

to the carrying value and classification of those financial assets

(net of any provisions) as presented in the statement of

financial position.

Trade and other receivables that are neither past due nor

impaired are considered to be of high credit quality.

Aggregates of such amounts are detailed at Note 5.

The company has no significant concentrations of credit risk

exposure to any single counterparty or group of

counterparties. Details with respect to credit risk of trade and

other receivables are provided in Note 5.

Credit risk related to balances with banks and other financial

institutions is managed by the finance committee in

accordance with approved board policy.

b. Liquidity risk

Liquidity risk arises from the possibility that the company

might encounter difficulty in settling its debts or otherwise

meeting its obligations in relation to financial liabilities. The

company manages this risk through the following mechanisms:

• preparing forward-looking cash flow analysis in relation to

its operational, investing and financing activities;

• maintaining a reputable credit profile;

• managing credit risk related to financial assets;

• only investing surplus cash with major financial institutions;

and

• comparing the maturity profile of financial liabilities with

the realisation profile of financial assets.

The table below reflects an undiscounted contractual maturity

analysis for financial liabilities.

Cash flows realised from financial assets reflect management’s

expectation as to the timing of realisation. Actual timing may

therefore differ from that disclosed. The timing of cash flows

presented in the table to settle financial liabilities reflects the

earliest contractual settlement dates.

Pathways Annual Report 14 / 15 • 27


Note 17:

Financial Risk Management

(Continued)

Financial liability and financial asset maturity analysis

Within 1 Year 1 to 5 Years Over 5 Years Total

2015 2014 2015 2014 2015 2014 2015 2014

$ $ $ $ $ $ $ $

FINANCIAL LIABILITIES

DUE FOR PAYMENT

Accounts payable and other

payables (excluding estimated

annual leave and deferred

income) 283,313 460,768 - - - - 283,313 460,768

Total expected outflows 283,313 460,768 - - - - 283,313 460,768

FINANCIAL ASSETS

– CASH FLOWS REALISABLE

Cash on hand 2,165,534 2,131,993 - - - - 2,165,534 2,131,993

Accounts receivable and other

debtors 71,238 43,620 - - - - 71,238 43,620

Other financial assets 519,859 525,569 - - - - 519,859 525,569

Total anticipated inflows 2,756,631 2,701,182 - - - - 2,756,631 2,701,182

Net (outflow)/inflow on

financial instruments 2,473,318 2,240,414 - - - - 2,473,318 2,240,414

c. Market risk

(i)

Interest rate risk

Exposure to interest rate risk arises on financial assets and

financial liabilities recognised at the end of the reporting

period whereby a future change in interest rates will affect

future cash flows or the fair value of fixed rate financial

instruments. The company is also exposed to earnings

volatility on floating rate instruments.

The financial instruments that expose the company to

interest rate risk are limited to lease liabilities, listed

shares, government and fixed interest securities, and cash

on hand.

(ii) Other price risk

Other price risk relates to the risk that the fair value or

future cash flows of a financial instrument will fluctuate

because of changes in market prices (other than those

arising from interest rate risk or currency risk) of securities

held.

The company is exposed to other price risk on

investments held for trading or for medium to longer

terms. Such risk is managed through diversification of

investments across industries and geographical locations.

Pathways Annual Report 14 / 15 • 28


Note 17:

Financial Risk Management

(Continued)

The company’s investments are held in the following sectors at the end of the reporting period:

2015 2014

Utilities 3% 4%

Insurance 3% 2%

Banks 18% 18%

Transportation 1% 0%

Materials 5% 7%

Diversified Financials 17% 14%

Telecomms 9% 9%

Food & Staples Retailing 6% 8%

International Shares 4% 3%

Energy 4% 4%

Cash Management Trust 21% 20%

Property Listed 7% 6%

Mortgage Trusts 1% 3%

Fixed Interest Listed 1% 2%

100% 100%

Sensitivity analysis

The following table illustrates sensitivities to the company’s exposures to changes in interest rates and equity prices. The table

indicates the impact on how profit and equity values reported at the end of the reporting period would have been affected by

changes in the relevant risk variable that management considers to be reasonably possible.

These sensitivities assume that the movement in a particular variable is independent of other variables.

Profit

Equity

$ $

Year ended 30 June 2015

+/– 2% in interest rates 43,311 43,311

+/– 10% in listed investments 51,986 51,986

Year ended 30 June 2014

+/– 2% in interest rates 42,640 42,640

+/– 10% in listed investments 52,557 52,557

No sensitivity analysis has been performed on foreign exchange risk as the company has no material exposures to currency risk.

There have been no changes in any of the assumptions used to prepare the above sensitivity analysis from the prior year.

Pathways Annual Report 14 / 15 • 29


Note 17:

Financial Risk Management

(Continued)

Fair Values

Fair value estimation

The fair values of financial assets and financial liabilities are

presented in the following table and can be compared to their

carrying amounts as presented in the statement of financial

position. Fair values are those amounts at which an asset could

be exchanged, or a liability settled, between knowledgeable,

willing parties in an arm’s length transaction.

Fair values may be based on information that is estimated or

subject to judgement, where changes in assumptions may have

a material impact on the amounts estimated. Areas of

judgement and the assumptions have been detailed below.

Where possible, valuation information used to calculate fair

values is extracted from the market, with more reliable

information available from markets that are actively traded. In

this regard, fair values for listed securities are obtained from

quoted market bid prices. Where securities are unlisted and no

market quotes are available, fair value is obtained using

discounted cash flow analysis and other valuation techniques

commonly used by market participants.

Differences between fair values and carrying amounts of

financial instruments with fixed interest rates are due to the

change in discount rates being applied by the market since

their initial recognition by the company. Most of these

instruments, which are carried at amortised cost (ie trade

receivables, loan liabilities), are to be held until maturity and

therefore the fair value figures calculated bear little relevance

to the company.

2015 2014

Footnote

Carrying

Amount

Fair

Value

Carrying

Amount

Fair

Value

$ $ $ $

FINANCIAL ASSETS

Cash and cash equivalents (i) 2,165,534 2,165,534 2,131,993 2,131,993

Loans and receivables (i) 71,238 71,238 43,620 43,620

Financial assets at fair value through profit or loss:

- At fair value:

- Listed investments held for trading 519,859 519,859 525,569 525,569

Total financial assets 2,756,631 2,756,631 2,701,182 2,701,182

Financial liabilities

Accounts payable other payables (i) 326,148 326,148 615,728 615,728

Total financial liabilities 326,148 326,148 615,728 615,728

i. Cash on hand, accounts receivable and other debtors, and

accounts payable and other payables are short-term

instruments in nature whose carrying amount is

equivalent to fair value. Trade and other payables exclude

amounts provided for annual leave, which is outside the

scope of AASB 139.

ii. For listed fair value through profit or loss financial assets,

closing quoted bid priced at the end of the reporting

iii.

period are used. In determining the fair values of the fair

value through profit or loss assets, the directors have used

inputs that are observed either directly (as prices) or

indirectly (derived from prices)

Fair values are determined using a discounted cash flow

model incorporating current commercial borrowing rates.

The fair value of fixed rate debt will differ from carrying

values.

Pathways Annual Report 14 / 15 • 30


Note 18:

Auditors Remuneration

2015 2014

$ $

Audit Services

Auditors of the Company 15,000 15,000

15,000 15,000

Note 19:

Members’ Guarantee

The company is incorporated under the Corporations Act 2001 and is a company limited by guarantee. If the company is wound up,

the constitution states that each member is required to contribute a maximum of $50 each towards meeting any outstanding

obligations of the entity. At 30 June 2015, the number of members was eight.

Note 20:

Entity Details

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

Pathways Rehabilitation and Support Services Limited

61 Pakington Street, Geelong West

Victoria 3218, Australia

Pathways Annual Report 14 / 15 • 31


Responsible Persons’ Declaration

In accordance with a resolution of the directors of Pathways Rehabilitation and Support Services Limited, the directors declare that:

1. The financial statements and notes, as set out on pages 7 to 31, are in accordance with the Australian Charities and Not-forprofits

Commission Act 2012 and:

a. comply with Australian Accounting Standards; and

b. give a true and fair view of the financial position of the company as at 30 June 2015 and of its performance for the year

ended on that date.

2. In the directors’ opinion there are reasonable grounds to believe that the company will be able to pay its debts as and when

they become due and payable.

This declaration is made in accordance with a resolution of the Board of Directors and subsection 60.15(2) of the Australian

Charities and Not-for-profit Commission Regulation 2013.

PHILIPPA BAKES | Chairperson

JOHN STEVENS | Director

Dated this 21st day of September Dated this 21st day of September 2015

Pathways Annual Report 14 / 15 • 32


Independent Auditor’s Report To The Members

Of Pathways Rehabilitation And Support Services Limited

Report on the Financial Report

We have audited the accompanying financial report of

Pathways Rehabilitation and Support Services Limited (the

company), which comprises the statement of financial position

as at 30 June 2015, the statement of profit or loss and other

comprehensive income, statement of changes in equity and

statement of cash flows for the year then ended, notes

comprising a summary of significant accounting policies and

other explanatory information, and the responsible persons’

declaration.

Directors’ Responsibility for the Financial Report

The directors of the company are responsible for the

preparation of the financial report that gives a true and fair

view in accordance with Australian Accounting Standards and

the Australian Charities and Not-for-profits Commission Act

2012 and for such internal control as the directors determine is

necessary to enable the preparation of the financial report that

gives a true and fair view and is free from material

misstatement, whether due to fraud or error.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial

report based on our audit. We conducted our audit in

accordance with Australian Auditing Standards. Those

standards require that we comply with relevant ethical

requirements relating to audit engagements and plan and

perform the audit to obtain reasonable assurance about

whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and disclosures in the financial

report. The procedures selected depend on the auditor’s

judgment, including the assessment of the risks of material

misstatement of the financial report, whether due to fraud or

error. In making those risk assessments, the auditor considers

internal control relevant to the company’s preparation of the

financial report that gives a true and fair view in order to

design audit procedures that are appropriate in the

circumstances, but not for the purpose of expressing an

opinion on the effectiveness of the entity’s internal control. An

audit also includes evaluating the appropriateness of

accounting policies used and the reasonableness of accounting

estimates made by the directors, as well as evaluating the

overall presentation of the financial report.

We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our audit

opinion.

Independence

In conducting our audit, we have complied with the

independence requirements of the Australian Charities and

Not-for-profits Commission Act 2012. We confirm that the

independence declaration required by the Australian Charities

and Not-for-profits Commission Act 2012, which has been

given to the directors of Pathways Rehabilitation and Support

Services Limited, would be in the same terms if given to the

directors as at the time of this auditor’s report.

Opinion

In our opinion, the financial report of Pathways Rehabilitation

and Support Services Limited is in accordance with the

Australian Charities and Not-for-profits Commission Act 2012,

including:

i. Giving a true and fair view of the company’s financial

position as at 30 June 2015 and of its performance for the

year ended on that date; and

ii. Complying with Australian Accounting Standards and the

Australian Charities and Not-for-profits Commission

Regulation 2013.

LBW CHARTERED ACCOUNTANTS

SRIPATHY SARMA | Principal

Dated this 21st day of September 2015

Pathways Annual Report 14 / 15 • 33


ACKNOWLEDGEMENTS

The Pathways Board, Management and staff wish to acknowledge and thank

the many organisations and individuals for their support and contributions

over the past 12 months.

Service Partners:

• Barwon Health

- Jigsaw (headspace)

- Homeless Outreach Psychiatric Services

• Colac Area Health

• Matchworks (Karingal)

• Services Connect

Partnerships:

Pathways works closely with many agencies, community services

and networks and we thank these organisations for their

collaboration.

Clearwater Property care would like to thank its many valued

customers with special thanks to:

• Geelong Kindergarten Association

• Nelson Park

• Salvo Connect

• City of Greater Geelong

• Vic Roads Ring Road project

• Bethany

• Geelong Best Western Motel

Government:

Pathways receives funding for its services from a number of

government departments including:

• Department of Health & Human Services

• Department of Social Services

• National Disability Insurance Agency

Sponsors / Donors:

• Give Where You Live

• GMHBA

Corporate Partnerships:

• Bendigo Financial Planning

• Blood Group

• Connect Tel

• Evongo

• Fuse Advisory

• LBW Chartered Accountants

• NAB

• Vecci

• Pacific National

• Telstra

• Caron

• Tannoch Brae Retirement Village

• Sirovilla Retirement Village

Pathways Annual Report 14 / 15 • 34


61 Pakington Street

Geelong West, Victoria, 3218

P: (03) 5229 8295

E: admin@pathways.org.au

www.pathways.org.au

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