OPEN DOORS AUSTRALIA INCORPORATED ANNUAL FINANCIAL …... · 2020-06-16 · Page 3 of 18 OPEN DOORS AUSTRALIA INCORPORATED ABN 52 209 804 287 BALANCE SHEET FOR THE YEAR ENDED 31 DECEMBER

OPEN DOORS AUSTRALIA INCORPORATED ABN 52 209 804 287

ANNUAL FINANCIAL REPORT

FOR THE YEAR ENDED 31 DECEMBER 2019 CONTENTS PAGESSTATEMENT BY MEMBERS OF THE BOARD 1AUDITOR’S INDEPENDENCE DECLARATION 2BALANCE SHEET 3INCOME STATEMENT 4 STATEMENT OF CHANGES IN EQUITY 5 CASH FLOW STATEMENT 6 NOTES TO THE FINANCIAL STATEMENTS 7 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF OPEN DOORS AUSTRALIA INCORPORATED

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AUDITOR’S INDEPENDENCE DECLARATION TO THE BOARD OF OPEN DOORS AUSTRALIA INCORPORATED In accordance with the requirements of section 60-40 of the Australian Charities and Not-for-profits Commission Act 2012, as lead auditor for the audit of the financial statements of Open Door Australia Incorporated for the financial year ended 31 December 2019, I declare that, to the best of my knowledge and belief, there have been: (i) no contraventions of the auditor independence requirements as set out in 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. Nexia Sydney Audit Pty Ltd Director

Brett Hanger Dated at Sydney, this 22nd day of May 2020

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BALANCE SHEET

FOR THE YEAR ENDED 31 DECEMBER 2019

Note 31.12.19 31.12.18 ASSETS $ $

CURRENT ASSETS

Cash and cash equivalents 2 526,376 557,253Inventory 5,389 21,197Prepaid expenses 53,188 41,399Other receivable 1,706 -Receivable from OD Affiliate 3 90,115 76,622Total Current Assets 676,774 696,471 NON-CURRENT ASSETS Building, plant and equipment 4 1,370,787 1,377,738Right-of-use assets 7 236,493 -Intangible assets 4 62,834 94,927Total Non-Current Assets 1,670,114 1,472,665

TOTAL ASSETS 2,346,888 2,169,136 LIABILITIES CURRENT LIABILITIES Trade and other payables 5 40,457 45,189Provisions 6 194,603 158,097Bank loan liability 8 79,736 71,459Other liabilities 66,546 13,658Lease liability 7 86,196 -Net payable to ATO 12,668 9,034Total Current Liabilities 480,206 297,437 NON-CURRENT LIABILITIES

Bank loan liability 8 598,081 705,378Lease liability 7 152,430 -Provisions 6 81,937 57,477Total Non-Current Liabilities 832,448 762,855

TOTAL LIABILITIES 1,312,654 1,060,292

NET ASSETS 1,034,234 1,108,844

EQUITY Retained Earnings 1,034,234 1,108,844 1,034,234 1,108,844

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INCOME STATEMENT


31.12.19 31.12.18 $ $ SUPPORT AND REVENUE Contributions and bequests 7,090,125 6,844,940Books and tapes, net of cost 5,845 6,095Interest income 352 655Other revenue 90,075 83,384Total Support and Revenue 7,186,397 6,935,074 EXPENSES Serving the Suffering Church by:

Literature distribution 422,704 408,144Training 1,460,248 1,409,953Awareness & Motivation of the Free Church 2,010,253 1,656,631Social Economic Support 1,613,958 1,558,369Research & Advocacy 453,804 417,714

Supporting the ministry to the Suffering Church by:

Fund raising 593,326 674,837Administration 706,714 724,813

Total Expenses 7,261,007 6,850,461

Excess/(Shortfall) of support and revenue over expenses (74,610) 84,613

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STATEMENT OF CHANGES IN EQUITY


2019

Retained Earnings Total

$ $ Balance at 1 January 2019 1,108,844 1,108,844Excess/(Shortfall) of support and revenue over expenses (74,610) (74,610)Balance at 31 December 2019 1,034,234 1,034,234 2018 Balance at 1 January 2018 1,024,231 1,024,231Excess/(Shortfall) of support and revenue over expenses 84,613 84,613Balance at 31 December 2018 1,108,844 1,108,844

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CASH FLOW STATEMENT


31.12.19 31.12.18 $ $ Cash flows from operating activities Excess of support and revenue over expenses (74,610) 84,613 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation 142,916 62,324 (Gain)/loss on sale of assets - (5,699) Assets written off during the year 1,470 5,110 Decrease/(increase) in other assets (15,198) (47,494) Decrease/(increase) in inventory 15,808 (9,441) Decrease/(increase) in prepaid expenses (11,789) 5,397 (Decrease)/increase in payables & receivables 35,245 (58,391) (Decrease)/increase in provisions 60,966 27,291 _________ _________ Net cash provided by operating activities 154,808 63,710 _________ _________ Cash flows from investing activities Payments for plant and equipment (28,624) (21,307) Proceeds from sale of fixed assets - 10,406 Payments for intangibles - (39,789) _________ _________ Net cash used in investing activities (28,624) (50,690) _________ _________ Cash flows from financing activities Repayment of borrowings ___(157,061) __(64,099) Net cash applied to investing activities (157,061) (64,099) ________________ ________________

Net (decrease)/increase in cash and cash equivalents (30,877) (51,079) Cash at beginning of year 557,253 608,332 _________ _________ Cash at end of year 526,376 557,253

_________ _________

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NOTES TO THE FINANCIAL STATEMENTS


NOTE 1. STATEMENT OF ACCOUNTING POLICIES This note provides a list of all significant accounting policies adopted in the preparation of the financial statements. These policies have been consistently applied to all the years presented, unless otherwise stated. a) New or amended Accounting Standards and Interpretations adopted The incorporated 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 Any new or amended Accounting Standards or Interpretations that are not yet mandatory have not been early adopted. Impact of adoption

AASB 15, AASB 16 and AASB 1058 were adopted using the modified retrospective approach and as such comparatives have not been restated. There was no impact on opening retained profits as at 1 January 2019. b) Basis of Preparation The financial statements are special purpose financial statements prepared in order to comply with the Associations Incorporations Act 2009 (NSW) and Section 60.40 of the Australian Charities and Not-for-profits Commission Regulation 2014 (ACNC Regulation). The members of the board have determined that the association is not a reporting entity. These financial statements have been prepared in accordance with the recognition and measurement requirements specified by the Australian Accounting Standards and Interpretations and the disclosure requirements of AASB 101, Presentation of Financial Statements, AASB 107, Statement of Cash Flow, AASB 108, Accounting Policies, Changes in Accounting Estimates and Errors, AASB 1031, Materiality, AASB 1048, Interpretation of Standards and AASB 1054, Australian Additional Disclosures. The financial statements have been prepared on historic costs convention (accrual basis) and do not take into account changing money values, except where stated specifically. Open Doors Australia Incorporated is an incorporated association under the Associations Incorporation Act 2009 (NSW). All known relevant statutory obligations under the Associations Incorporation Act 2009 (NSW) or otherwise have been reported in these financial statements. Items such as taxes deducted on behalf of employees and superannuation guarantee payments have been accounted for on an accruals basis.

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OPEN DOORS AUSTRALIA INCORPORATED

ABN 52 209 804 287

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

c) Plant and Equipment Plant and equipment are stated at historical cost less depreciation. Historical cost includes directly attributable initial expenses to bring the assets to its condition of use. The depreciation policies are straight line method over their estimated useful lives.

d) Inventories

Inventories are stated at lower of cost and realisable value and consist principally of religious books and related materials.

e) Cash and Cash Equivalents For the purpose of presentation in the Cash flow Statements, cash and cash equivalents

include cash on hand, cash at bank and deposits on call. f) Trade and other payables Trade and other payables for goods and services provided to the entity prior to the end

of the financial year which are unpaid. The amounts are unsecured and are usually paid within 30 days of recognition.

g) Provisions Provisions are recognised when the association 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 are measured at the best estimate of the amounts required to settle the obligation at the end of the reporting period.

The obligations of long service leave and annual leave are presented as current liabilities

in the balance sheet if the entity does not have an unconditional right to deter settlement for at least twelve months after reporting period, regardless of when the actual settlement is expected to occur.

Provisions are made for separation and redundancy benefit payments. The entity

recognises a provision for termination when it has developed a detailed formal plan for the termination and has informed those employees affected that it will carry out the termination.

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h) Revenue and Other Income Revenue is recognised at an amount that reflects the consideration to which the entity is

expected to be entitled in exchange for transferring goods or services to a customer. For each contract with a customer, the entity identifies the contract with a customer; identifies the performance obligations in the contract; determines the transaction price which takes into account estimates of variable consideration and the time value of money; allocates the transaction price to the separate performance obligations on the basis of the relative stand-alone selling price of each distinct good or service to be delivered; and recognises revenue when or as each performance obligation is satisfied in a manner that depicts the transfer to the customer of the goods or services promised.

Donations and bequests are recognised as revenue when received. Interest income is recognised using the effective interest rate method, which, for floating

rate financial assets, is the rate inherent in the instrument. Revenue from the rendering of a service is recognised upon the delivery of the service to

the customers. Sale of goods and services are stated net of goods and services tax (GST). i) Foreign currency translations The entity's financial statements are presented in Australian dollars, which is the

functional and presentation currency of the entity. Foreign currency transactions are translated into the functional currency using the

exchange rates at the date of the transaction. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies at year end exchange rates are recognised in profit or loss.

Non-monetary items that are measured at fair value in a foreign currency are translated

using exchange rates at the date when the fair value was determined. Translation differences on assets and liabilities carried at fair value are recognised in profit or loss as part the fair value gain or loss.

j) Right-of-use assets and Lease liabilities A right-of-use asset is recognised at the commencement date of a lease. The right-of-use

asset is measured at cost, which comprises the initial amount of the lease liability, adjusted for, as applicable, any lease payments made at or before the commencement date net of any lease incentives received, any initial direct costs incurred, and, except where included in the cost of inventories, an estimate of costs expected to be incurred

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for dismantling and removing the underlying asset, and restoring the site or asset. Right-of-use assets are depreciated on a straight-line basis over the unexpired period of

the lease or the estimated useful life of the asset, whichever is the shorter. Right-of use assets are subject to impairment or adjusted for any remeasurement of lease liabilities.

The entity has elected not to recognise a right-of-use asset and corresponding lease

liability for short-term leases with terms of 12 months or less and leases of low-value assets. Lease payments on these assets are expensed to profit or loss as incurred.

A lease liability is recognised at the commencement date of a lease. The lease liability is

initially recognised at the present value of the lease payments to be made over the term of the lease, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, the entity's incremental borrowing rate. Lease liabilities are measured at amortised cost using the effective interest method.

k) 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. l) Goods and Services Tax 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). 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 assets and liabilities statement.

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FOR THE YEAR ENDED 31 DECEMBER 2019 NOTE 2. CASH AND CASH EQUIVALENT 31.12.2019 31.12.2018 $ $ CURRENT Cash on hand 797 855 Cash reserves at bank – interest bearing 509,671 543,482 Term deposit (secured) – interest bearing 15,908 12,916 _______ _______ Cash and cash equivalent 526,376 557,253 _______ _______

NOTE 3. RECEIVABLE FROM ODI AFFILIATES

CURRENT OD International 90,115 76,622 _______ _______ 90,115 76,622

_ ______ _______ Receivable from ODI Affiliates are interest free and less than 30 days overdue.

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FOR THE YEAR ENDED 31 DECEMBER 2019 NOTE 4. BUILDING, PLANT AND EQUIPMENT & INTANGIBLE ASSETS

Cost Accumulated

Depreciation Net Book Value $ $ $ 2019 Plant and equipment Land and Building (Castle Hill) 1,258,110 - 1,258,110 Building improvements 37,257 10,952 26,305 Fixtures and fittings 72,795 26,712 46,083 Office equipment 10,880 5,638 5,242 Computer equipment 112,712 77,665 35,047 Motor Vehicles 15,909 15,909 - 1,507,663 136,876 1,370,787 Intangible Assets 120,939 58,105 62,834 Total 1,628,602 194,981 1,433,621

2018 Plant and equipment Land and Building (Castle Hill) 1,258,110 - 1,258,110 Building improvements 37,257 7,227 30,030 Fixtures and fittings 69,339 24,547 44,792 Office equipment 37,256 28,318 8,938 Computer equipment 128,916 93,048 35,868 Motor Vehicles 15,909 15,909 - 1,546,787 169,049 1,377,738

Intangible Assets 122,409 27,482 94,927

Total 1,669,196 196,531 1,472,665

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FOR THE YEAR ENDED 31 DECEMBER 2019 NOTE 5. TRADE PAYABLE AND OTHER PAYABLES 31.12.2019 31.12.2018 $ $ CURRENT Trade payables 21,501 31,137 Due to employees (including super contribution) 18,956 14,052 _______ _______ Total 40,457 45,189 _______ _______ NOTE 6. PROVISIONS CURRENT Provision for annual leave 181,148 152,025 Provision for long service leave 13,455 6,072 _______ _______ Total 194,603 158,097 _______ _______ NON-CURRENT Provision for long service leave 81,937 57,477 _______ _______ Total 81,937 57,477 _______ _______

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FOR THE YEAR ENDED 31 DECEMBER 2019 NOTE 7. Right-of-use assets and lease liabilities 31.12.2019 31.12.2018 $ $

Non-Current Assets – right-of-use Land and buildings - right-of-use asset 108,980 - Less: accumulated depreciation (7,532) - _______ _______ 101,448 - Motor vehicle - right-of-use asset 164,331 - Less: accumulated depreciation (58,838) - _______ _______ 105,493 -

Plant and equipment - right-of-use asset 39,902 - Less: accumulated depreciation (10,350) - _______ _______ 29,552 - _______ _______ Total 236,493 - _______ _______ Lease liabilities

Current 86,196 - Non-Current 152,430 -

_______ _______ Total 238,626 - _______ _______

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OPEN DOORS AUSTRALIA INCORPORATED

ABN 52 209 804 287

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2019

NOTE 8. BANK LOAN

SECURED

Current 79,736 71,459 Non-Current 598,081 705,378

_______ _______ Total 677,817 776,837 _______ _______

The entity purchased premises at Castle Hill on 20 December 2016. The bank loan is secured by the premise at Castle Hill.

NOTE 9. EVENTS OCCURING AFTER THE REPORTING DATE

The financial report was authorised for issue on 22nd May 2020 by the Board. At the date of authorisation of the financial report the entity is continuing to monitor and respond to the effects of the COVID-19 virus. Any potential financial effect of the virus is unknown. There has not arisen in the interval between the end of the year and the date of this report any other item, transaction or event of a material and unusual nature likely, in the opinion of the Board, to affect significantly the operations of the entity, the results of those operations, or the state of affairs of the entity, in future financial years.

INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF OPEN DOORS AUSTRALIA INCORPORATED

Report on the Audit of the Financial Report We have audited the financial report of Open Doors Australia Incorporated (the association), which comprises the balance sheet as at 31 December 2019, the income statement, statement of changes in equity and cash flow statement for the year then ended, and notes to the financial statements, including a summary of significant accounting policies, and the statement by members of the Board.

In our opinion: a) the financial report of Open Doors Australia Incorporated is in accordance with Division 60 of

the Australian Charities and Not-for-profits Commission Act 2012, including: i) giving a true and fair view of the association’s financial position as at 31 December 2019

and of its performance and cash flows for the year ended on that date; and ii) complying with Australian Accounting Standards to the extent described Note 1 to the

financial statements and the Australian Charities and Not-for-profits Commission Regulation 2013.

b) the financial report agrees to the underlying financial records of Open Doors Australia Incorporated, that have been maintained, in all material respects, in accordance with the Charitable Fundraising Act 1991 and its regulations for the year ended 31 December 2019;

c) monies received by Open Doors Australia Incorporated, as a result of fundraising appeals conducting during the year ended 31 December 2019, have been accounted for and applied, in all material respects, in accordance with the Charitable Fundraising Act 1991 and its regulations.

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 Subdivision 60C of the Australian Charities and Not-for-profits Commission Act 2012 (ACNC Act) 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.

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Responsibilities of Those charges with Governance for the Financial Report, for Compliance with the Australian Charities and Not-for-profits Commission Act 2012 and the Charitable Fundraising Act 1991 The Board of Management (“the Board”) is responsible for the preparation of the financial report that gives a true and fair view in accordance note 1 to the financial statements, the Australian Charities and Not-for-profits Commission Act 2012 and for compliance with the Charitable Fundraising Act 1991. The Board is also responsible for such internal control as the Board determine is necessary to enable compliance with requirements of the Charitable Fundraising Act 1991 and 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. In preparing the financial report, the Board is 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 Board 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 association has complied with the specific requirements of the with the Charitable Fundraising Act 1991 and 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 the 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. As part of an audit in accordance with the Australian Auditing Standards, we exercise professional judgement and maintain professional scepticism throughout the audit. We also: • Identify and assess the risks of non-compliance with the specific requirements of the Charitable

Fundraising Act 1991 and risk of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit 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 association’s internal control.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Board.

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• Conclude on the appropriateness of the Board’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the association’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial report or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the association to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation.

We communicate with Board regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. Inherent Limitations Because of the inherent limitations of any compliance procedure, it is possible that fraud, error, or non-compliance with the Charitable Fundraising Act 1991 may occur and not be detected. An audit is not designed to detect all weaknesses in Open Doors Australia Incorporated’s compliance with the Charitable Fundraising Act 1991 as an audit is not performed continuously throughout the period and the tests are performed on a sample basis. Nexia Sydney Audit Pty Ltd

Director

Brett Hanger

Dated at Sydney, this 26th day of May 2020

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Documents

OPEN DOORS AUSTRALIA INCORPORATED ANNUAL FINANCIAL …... · 2020-06-16 · Page 3 of 18 OPEN DOORS AUSTRALIA INCORPORATED ABN 52 209 804 287 BALANCE SHEET FOR THE YEAR ENDED 31 DECEMBER