June 2020 Financial Report

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June 2020 Financial Report

Gravity Discovery Centre Foundation Inc.

ABN 26 892 177 952

For the year ended 30 June 2020

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June 2020 Financial Report Gravity Discovery Centre Foundation Inc. Page 2 of 16

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1. Presenc fairly the financial position aft he Gravity DiscaveryCentre Foundation Inc as at 30 June 2020 and its performance for the year ended an that date;

2. Comply with Australian llccounting Standards outlined in the Notes to the Hnancial Statements; ~nrl

:l. In the directors' opinion, tht>rP are- r"•Son;,hl" e,ruund~ to believe that the Foundation will be able to pay its debts 35 and when they become due and payable.

The directors of the Fuundacion declare that the Financial Statements:

The directors have determined that th!".' Foundation is not a reporting entity. The directors have determined that this Special Purpose Financial Report should be prepared in accordance with th-. accounting µulide~ outtined in the Notes ta the Financial

Statements,

Gravity Discovery Centre Foundation Inc.

For the year ended 30 June 2020

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AUDITOR’S INDEPENDENCE DECLARATION UNDER SECTION 80 OF THE ASSOCIATIONS

INCORPORATION ACT 2015

TO THE DIRECTORS OF GRAVITY DISCOVERY CENTRE FOUDNATION INC

I declare that, to the best of my knowledge and belief, during year ended 30 June 2020 there have been:

i) No contraventions of the auditor independence requirements as set out in the

Associations Incorporation Act 2015 in relation to the audit; and

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

ARMADA AUDIT & ASSURANCE PTY LTD

NIGEL DIAS DIRECTOR

Perth

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INDEPENDENT AUDIT REPORT ON THE FINANCIAL REPORT TO THE MEMBERS OF GRAVITY DISCOVERY CENTRE FOUNDATION INC Opinion

We have audited the financial report being a special purpose financial report of Gravity Discovery Centre Foundation Inc. (“the Association”) which comprises the statement of financial position as at 30 June 2020, the statement of profit loss and other comprehensive income, statement of changes in equity and statement of cash flows for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the directors’ declaration.

In our opinion, the accompanying financial report of Gravity Discovery Centre Foundation Inc. is in accordance with the Associations Incorporation Act 2015, including:

a) Giving a true and fair view of the Association’s financial position as at 30 June 2020 and of its financial performance and cash flows for the year then ended; and

b) Complying with Australian Accounting Standards to the extent described in the Notes to the financial report.

Basis for Opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial

Report section of our report. We are independent of the Association in accordance with the auditor

independence requirements of the Associations Incorporation Act 2015 and the ethical requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional

Accountants (“the Code”) that are relevant to our audit of the financial report in Australia. We have also

fulfilled our other ethical responsibilities in accordance with the Code. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Emphasis of Matter – Basis of Accounting

We draw attention to Notes to the financial report, which describes the basis of accounting. The financial report has been prepared for the purpose of fulfilling the director’s financial reporting responsibilities under the Associations Incorporation Act 2015. As a result, the financial report may not be suitable for another purpose. Our opinion is not modified in respect of this matter.

Responsibilities of the Directors for the Financial Report

The Directors of the Association are responsible for the preparation of the financial report that gives a true and fair view and have determined that the basis of preparation described in the Notes to the financial report is appropriate to meet the needs of the members and the Associations Incorporation

Act 2015. The Director’s responsibility also includes such internal control as the Directors determine is

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Responsibilities of the Directors for the Financial Report (Continued)

In preparing the financial report, the Directors are responsible for assessing the ability of the Association to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Directors either intend to liquidate the Association or to cease operations, or have no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. A further description of our responsibilities for the audit of the financial report is located at the Auditing and Assurance Standards Board website at

<http://www.auasb.gov.au/auditors_responsibilities/ar4.pdf>.This description forms part of this auditor’s report.

ARMADA AUDIT ASSURANCE PTY LTD

NIGEL DIAS DIRECTOR

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Trading Statement

Gravity Discovery Centre Foundation Inc.

For the year ended 30 June 2020

2020 2019

Trading Revenue

Sales

Cafe Revenue 65,642 79,202

Entrance Fees 108,710 146,108

Gift Shop Revenue 10,245 14,317

Observatory Revenue 124,371 137,382

Total Sales 308,968 377,009

Cost of Sales

Cafe Purchases (34,241) (45,821)

Gift Shop Purchases (8,418) (7,644)

Observatory Expenses (10,707) (15,775)

POS Variance (71) (786)

Salaries and Wages (136,474) (156,879)

Total Cost of Sales (189,911) (226,905)

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Statement of Comprehensive Income

Gravity Discovery Centre Foundation Inc.

For the year ended 30 June 2020

NOTES 2020 2019

Income

Trading profit 119,057 150,104

Other Income

Government grants

Grant - Department of Industry - 5,500

Grant - Department of Education 93,681 93,681

Grant - Premier's Department - 14,000

Grant - Covid19 Recovery Grant 5,909

-Total Government grants 99,590 113,181

Government Stimulus

Cash Flow Boost 19,234

-Government Jobkeeper payments 87,000

-Total Government Stimulus 106,234

-Interest 1,721 2,942

Other revenue 29,563 26,713

Total Other Income 237,108 142,836

Total Income

356,165 292,940

Expenses

Bad debts 1,320

-Depreciation 135,369 136,599

Entertainment 271 862

Events and festivals 1,003 9,434

Foreign currency gains/losses - 2

Exhibits 3,939 12,125

Insurance 29,300 20,272

Operating Expenses 65,597 84,363

Repairs and maintenance 23,617 14,027

Scholarships - 4,935

Superannuation expenses 26,675 28,874

Wages and salaries 149,025 151,996

Wages - Jobkeeper Portion 61,378

-Travel 5,078 1,130

Annual leave expense 16,320

-Total Expenses 518,892 464,619

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Statement of Financial Position

Gravity Discovery Centre Foundation Inc.

As at 30 June 2020

NOTES 30 JUN 2020 30 JUN 2019

Assets

Current Assets Cash at bank 45,773 8,664 Term deposits 123,669 190,264 Trade receivables 1,701 20,952 Inventory 1,774 1,761

Government Stimulus Accrual 27,000

-Bendigo Master card 575 (642)

Total Current Assets 200,492 220,999

Non-Current Assets

Buildings at cost 4,407,982 4,542,514

Plant and equipment at cost 5,913 6,750

Total Non-Current Assets 4,413,895 4,549,264

Total Assets 4,614,387 4,770,263

Liabilities

Current Liabilities Taxation

ATO liabilities 14,910 10,195

Goods and services tax (4,049) 459

PAYG Witholding payable 7,224 2,620

Total Taxation 18,085 13,274

Trade payables 2,087 9,955

Customer deposits 1,133

-Employee expenses 13,995 14,750

Voucher purchases - 6,790

Provision for annual leave 16,320

-Total Current Liabilities 51,620 44,769

Total Liabilities 51,620 44,769

Net Assets

4,562,767 4,725,494

Equity

Retained Earnings 4,562,767 4,725,494

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Statement of Change in Equity

Gravity Discovery Centre Foundation Inc.

For the year ended 30 June 2020

2020 2019

Equity

Opening Balance 4,725,494 4,897,173

(Loss) for the Period (162,727) (171,679)

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Financial Report | Gravity Discovery Centre Foundation Inc.. Page 11 of 16

Statement of Cash Flows

Gravity Discovery Centre Foundation Inc.

For the year ended 30 June 2020

2020 2019

Cash flows from operating activities

Grants and receipts from customers 347,841 270,926

Payments to suppliers and employees (377,327) (312,089)

Total Cashflows from operating activities (29,486) (41,163)

Net increase/(decrease) in cash held (29,486) (41,163)

Cash and cash equivalents at the beginning of the year 198,928 240,091

Cash and cash equivalents at the end of the year 169,442 198,928

2020 2019

Loss for the period (162,727) (171,679)

Depreciation 135,369 136,598

Operating profit before changes in working capital (27,358) (35,081)

Change in receivables 18,676 (16,514)

Change in inventory (13) 2,355

Change in ATO stimulus receivable (27,000) -

Change in trade and other payables (10,111) 8,077

Change in employee provisions 16,320 -

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Notes to the Financial Statements

Gravity Discovery Centre Foundation Inc.

For the year ended 30 June 2020

Basis of Preparation

This special purpose financial report has been prepared in accordance with the requirements of the Australian Charities and

Not-for-profits Commission Act 2012, and recognition and measurement aspects of all applicable Australian Accounting

Standards ("AASBs") adopted by the Australian Accounting Standards Board ("AASB"). The Board has determined that the Association is not a reporting entity.

The financial report does not include all of the disclosure requirements of the AASBs except for the following minimum requirements:

AASB 101 Presentation of Financial Statements AASB 107 Cash Flow Statements

AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors AASB 1048 Interpretation of Standards

AASB 1054 Australian Additional Disclosures

Basis of Measurement

The financial report has been prepared on an accruals basis and is based on historical cost.

New Standards effective 1 July 2019

The Association has adopted all of the new or amended Accounting Standards and Interpretations issued by the Australian Accounting Standards Board ('AASB') that are mandatory for the current reporting period. The Association has adopted the new accounting pronouncements which have become effective this year, and are as follows:

AASB 15 Revenue from Contracts with Customers (Effective 1 July 2019)

AASB 15 Revenue from contracts with Customers (AASB 15) replaces AASB 118 Revenue and AASB 111 Construction Contracts and related interpretations and it applies to all revenue arising from contracts with customers, unless those contracts are in the scope of other standards. AASB 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised, including in respect of multiple element arrangements. The core principle of AASB 15 is that it requires identification of discrete performance obligations within a transaction and associated transaction price allocation to these obligations. Revenue is recognised upon satisfaction of these performance obligations, which occur when control of goods or services is transferred, rather than on transfer of risks or rewards. Revenue received for a contract that includes a variable amount is subject to revised conditions for recognition, whereby it must be highly probable that no significant reversal of the variable component may occur when the uncertainties around its measurement are removed.

AASB 1058 Income of Not-for-Profit Entities (Effective 1 July 2019)

In addition to AASB 15, not-for-profit entities need to consider and apply AASB 1058 Income of Not-For-Profit Entities. An asset received by a not-for-profit (NFP) entity is initially recognised at its fair value where the consideration paid for the asset is significantly less than fair value and that difference is principally to enable the entity to further its objectives. Such assets include physical, intangible and financial assets - whether acquired, donated or granted. An asset also includes the right to use an asset under AASB 16 Leases.

The general principle in AASB 1058 is that the entity recognises, as income immediately, the difference between the fair value of the asset received and any amount separately recognised as either:

· an equity contribution;

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Notes to the Financial Statements

June 2020 Financial Report Gravity Discovery Centre Foundation Inc. Page 13 of 16 · a financial instrument, in accordance with AASB 9 Financial Instruments; or

· a provision, in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets.

Guidance has been provided to assist not-for-profit entities to determine whether, in relation to identifying a contract and identifying performance obligations, a transaction is within the scope of AASB 15 Revenue from Contracts with Customers. In order for an arrangement to represent a contract with a customer within the scope of AASB 15, the arrangement must be enforceable and contain sufficient specific performance obligations (that is, a promise to provide identifiable goods or services to the customer). A promise in a contract must be sufficiently specific to enable determination of when the obligation is satisfied.

The Association has adopted AASB 1058 Income of Not-for-Profit Entities and AASB 15 Revenue from Contracts with Customers from 1 July 2019 which resulted in changes in accounting policies only. The Association has adopted the new rules as at the date of initial application and has not restated comparatives for the 2019 year. The adoption of AASB 1058 and AASB 15 did not result in any material changes to the Association’s financial report in current and prior year

Statement of Significant Accounting Policies

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.

Inventories

Inventories are carried at the lower of cost or net realisable value. Cost is based on the first-in, first out method and includes expenditure incurred in acquiring the inventories and bringing them to their existing condition and location.

Property, Plant and Equipment

Items of property, plant and equipment are measured at cost less accumulated depreciation and impairment losses.

Depreciation is charged to the statement of comprehensive income on a diminishing value basis over the estimated useful lives of each part of an item of property plant and equipment. The estimated useful lives in the current and comparative periods are as follows:

1. Buildings - 2%

2. Fixtures and Fittings - 20%

3. Office equipment - 20%

4. Plant and equipment - 20%

Trade and Other Receivables

Trade receivables and other receivables are recognised at the nominal transaction value without taking into account the time value of money. Impairment is recognised using the expected credit loss model under AASB 9. The Association uses the simplified approach.

Trade and Other Payables

Trade and other payables represent the liabilities for goods and services received by the company that remain unpaid at 30 June 2020. Trade payables are recognised at their transaction price. They are subject to normal credit terms and do not bear interest.

Cash and Cash Equivalents

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Revenue Recognition

To determine whether and when to recognise revenue, the Association follows a 5-step process: (1) Identifying the contract with a customer;

(2) Identifying the performance obligations; (3) Determining the transaction price;

(4) Allocating the transaction price to the performance obligations; and (5) Recognising revenue when/as the performance obligation(s) are satisfied. The Association’s main revenue sources and accounting policies are listed below: Grant Revenue Contracts

Revenue is measured with respect to the ability to meet the sufficiently specific criteria under the new accounting standard

AASB 15 Revenue from Contracts with Customers if revenue or grant funding is a result of a contract with customer with

enforceable rights, and obligations that as are sufficiently specific, revenue would be recognised in accordance with AASB 15 rather than AASB 1058 Income for Not-For-Profit Entities. Government grants are recognised in the period in which the sufficiently specific criteria are met. If the agreement is not enforceable and/or does not contain sufficiently specific performance

obligations, revenue is recognised on receipt in accordance with AASB 1058 Income for Not for Profit Entities.

A contract liability is recognised for any funds received for performance obligations that are not satisfied at the reporting period. Furthermore, if the contract contains a requirement to return unspent funds such amounts are recognised as a provision in accordance with AASB 137 Provisions, Contingent Asset and Liabilities.

Entrance Fees, School Incursions & Observatory Income

Revenue from entrance fees, school incursions and observatory fees is recognised at a point in time that the customers visit and tour the Gravity Discovery Centre.

Café Sales and Souvenir Sales

Revenue from sale of goods from the café and souvenir sales is recognised when control of the goods are transferred to the customer

Job Keeper and Cash Flow Boost

Job Keeper income is recognised in profit and loss in accordance with AASB 1058 Income for not-for-profit entities. The Association is entitled to accrue Job Keeper receipts under AASB 1058 for eligible wages paid or accrued at 30 June. Cash Flow Boost income is recognised when the eligibility requirements are met and the entity has a right to receive the grant in

accordance with AASB 1058.

Goods and Services Tax

Transactions are recognised net of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO).

Receivables and payables are stated inclusive of the amount of GST receivable or payable. The net amount of GST recoverable from, or payable to, the ATO is included with other receivables or payables in the balance sheet.

AASB 16 Leases

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June 2020 Financial Report Gravity Discovery Centre Foundation Inc. Page 15 of 16 applied AASB 16 on date of initial application, being 1 July 2019. The Association does not have any material lease arrangements as the lessee. Therefore AASB 16 did not have a material impact on the financial report of the Association.

Financial Instruments

Initial Recognition and Initial Measurement

Financial assets and financial liabilities are recognised when the Association becomes a party to the contractual provisions to the instrument. For financial assets, this is the date that the Association commits itself to either the purchase or sale of the asset (i.e. trade date accounting is adopted).

Financial instruments (except for trade receivables) 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 expensed to profit or loss immediately. Where available, quoted prices in an active market are used to determine fair value. In other circumstances, valuation techniques are adopted.

Classification and Subsequent Measurement Financial Liabilities

Financial liabilities are subsequently measured at: amortised cost; or

fair value through profit and loss.

A financial liability is measured at fair value through profit and loss if the financial liability is: a contingent consideration of an acquirer in a business combination to which AASB 3 applies; held for trading; or

initially designated as at fair value through profit or loss.

The Association does not measure any financial liabilities at fair value through profit or loss.

All other financial liabilities are subsequently measured at amortised cost using the effective interest method. The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest expense in profit or loss over the relevant period. The effective interest rate is the internal rate of return of the financial asset or liability. That is, it is the rate that exactly discounts the estimated future cash flows through the expected life of the instrument to the net carrying amount of initial recognition.

A financial liability cannot be reclassified. Financial Assets

Financial assets are subsequently measured at: amortised cost;

fair value through other comprehensive income; or fair value through profit and loss.

based on the two primary criteria, being:

the contractual cash flow characteristics of the financial asset; and the business model for managing the financial assets.

A financial asset is subsequently measured at amortised cost when it meets the following conditions:

the financial asset is managed solely to collect contractual cash flows; and the contractual terms within the financial asset give rise to cash flows that are solely payments of principal and interest on the principal amount outstanding on specified dates. The Association only has financial assets measured at amortised cost, being trade and other receivables and cash at bank. Impairment

The Association recognises a loss allowance for expected credit losses on financial assets that are measured at amortised cost or fair value through other comprehensive income. Expected credit losses are the probability-weighted estimate of credit losses over the expected life of a financial instrument. A credit loss is the difference between all contractual cash flows that are due, and all cash flows expected to be received, all discounted at the original effective interest rate of the financial instrument. The Association’s main financialasset is trade debtors. The Association uses the simplified approach to impairment, as applicable under AASB 9.

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June 2020 Financial Report