Financial Report 2015–16

This is the financial report of the Australian Academy of Science for the year ended 30 June 2016. It includes a balance sheet for the financial year, as well as statements of comprehensive income, changes in equity and cash flows.

Download the financial report (PDF 560kb)

Treasurer’s commentary on Financial Statements 2016

The Academy has posted an accounting deficit of $167,860 (2015 $52,547 deficit) for the year ended 30 June 2016 incorporating a non-cash impairment loss of $925,417. It must be noted also that Academy investments have decreased in value over this amount by $431,657 (2015 increase of $880,949) which creates an overall (but not realised) loss of $599,517 (2015 $828,402 gain). Compliance with accounting standards requires that significant changes in the market value of investments must be accounted for, but as the chart of funds under management illustrates, the trend in the value of the Academy’s endowments is upwards, reflecting the careful stewardship of these endowments. It would, of course, be better if the accounts showed a surplus, making more funds available for new initiatives.

Please see the below table detailing the Academy’s operating deficit and how it has been funded:

*Primary Connections income does not include donations yet to be spent so this will differ from audited figures due to accounting treatment.

This shows that Academy operations cost $1.4 million and Primary Connections Operations $0.43 million, funded by net untied investment income of $1.44 million to the extent that grants did not cover expenditure. Please note that there were also some small transfers over the year from the Enlightening Fund to Academy Operations. This is a much better result than the prior year noting in particular that much of the untied expenses related to a large non cash impairment loss.

Performance to budget – The major positive variances can be attributed to:

1. Investment income (net of sales and brokerage) is up on budget by 9%. The net gain on sale of investments amounting to $321,674 is not budgeted for; it is policy not to use capital gains as income.
2. Cost of sales is down 51% due to Primary Connections units not selling as predicted.
3. Activity in the Primary Connections – public good program was down on budget by 80% reflecting the challenges in providing bursaries to teachers. Whilst in practice the Academy must treat the underspend as a future liability, it is recognised as a reduction in expense under accounting standards as the obligation is essentially an internal agreement.
4. In similar fashion to c., Primary Connections total costs are down 11%, largely through restructuring to accommodate lower sales.
5. Various other departments have spent less than budgeted over the year.
6. Depreciation expense is lower than budgeted by 7% as write offs have occurred over the year (mainly related to the previous CRM and web costs).

Negative variances can be attributed to:

1. Primary Connections sales – actual unit sales were 59% down on budget. As noted the overall deficit for the unit was $431,890. Please also note that the result includes an apportionment of “interest” of $41,197 on the notional capital (especially retained earnings) of the business unit; balancing this, the unit nominally contributed $100,800 to central overheads such as Accounts, Insurance, IT and HR. Unit development costs are capitalised and then expensed once units are sold.
2. Rental income is down 10% as office space has been reclaimed.
3. Project over-runs such as Future Earth contributed to a total amount of $145,993 which were not budgeted for. Countering this was project underspends to the total of $81,403.
4. A non-cash impairment loss of $925,141 has been booked as required because ANZ, NAB, Bendigo & Adelaide Bank, MG Unit Trust, QBE and Woolworth stocks dipped by 20% or more of their opening value for the year. The Investment subcommittee continues to monitor these stocks.

At the end of June 2016 the Academy employed 62 full time equivalent staff. The full audited accounts of the Academy are available on the Academy website (above) and a hard copy can be printed off for those who require one by calling the Academy Secretariat on 02 6201 9400.

For a more detailed break up of income and expenditure please refer to the charts below.

Income and expense

Investment history

Support for Academy activities (amounts $10,000 and above)

January 2016 to December 2016

Grant figures comprise total grant excluding GST.