amp foundation charitable trust... · 2020-05-22 · amp foundation charitable trust abn 45 237 572...

AMP FOUNDATION CHARITABLE TRUST

ABN 45 237 572 935

Trustee’s report and

Special purpose financial report

for the year ended

31 December 2019

Registered Office: 33 Alfred Street

Sydney NSW 2000 Australia

AMP Foundation Charitable Trust is a trust established and domiciled in Australia.

AMP Foundation Charitable Trust

ABN 45 237 572 935

Trustee’s report and Special purpose financial report for the year ended 31 December 2019

Contents

TRUSTEE’S REPORT .................................................................................................................................................... 1

AUDITOR’S INDEPENDENCE DECLARATION............................................................................................................. 3

STATEMENT OF COMPREHENSIVE INCOME ............................................................................................................. 4

STATEMENT OF FINANCIAL POSITION ...................................................................................................................... 5

STATEMENT OF CHANGES IN TRUST’S FUNDS ........................................................................................................ 6

STATEMENT OF CASH FLOWS ................................................................................................................................... 7

NOTES TO THE FINANCIAL STATEMENTS ................................................................................................................. 8

1. BASIS OF PREPARATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES ............................... 8

2. NOTES TO THE STATEMENT OF CASH FLOWS ............................................................................................ 10

3. AUDITOR’S REMUNERATION .......................................................................................................................... 10

4. EVENTS OCCURRING AFTER THE REPORTING DATE ................................................................................. 10

MANAGER’S DECLARATION ..................................................................................................................................... 11

STATEMENT BY DIRECTORS OF THE TRUSTEE COMPANY .................................................................................. 12

INDEPENDENT AUDITOR’S REPORT TO THE TRUSTEE OF AMP FOUNDATION CHARITABLE TRUST .............. 13


1

Trustee’s report for the year ended 31 December 2019 AMP Foundation Limited presents its report on AMP Foundation Charitable Trust (the Trust) for the financial year ended 31 December 2019.

Trustee The trustee of the Trust is AMP Foundation Limited (the Trustee). The directors of the Trustee during the year ended 31 December 2019 and up to the date of this report are shown below. Directors were in office for this entire period. Peter Shergold Chairman, Non-executive Director Matthew Percival Non-executive Director Fiona Wardlaw Non-executive Director Prudence Milne Non-executive Director Helen Livesey Executive Director The Public Officer is Helen Liondos. Principal activities

The principal activity of the Trust during the year was to invest in the community to make a difference, especially

at a grassroots level. This is done through community programs and partnerships.

The Trust is registered with the Australian Charities and Not-for-profits Commission (ACNC).

The Trust is a beneficiary of the AMP Foundation, has a charitable status for tax purposes, and is exempt in

relation to income tax. It was formed on 19 June 1998 and was established to receive undistributed income

earned by the AMP Foundation to fund its charitable activities.

There have been no significant changes in the nature of these activities during the year. Review of operations and results The result for the year ended 31 December 2019 was a net profit of $6,993,279 (2018: $4,378,086) which includes a distribution of $1,436,103 (2018: $1,887,436) from the AMP Foundation. Total comprehensive income for the year ended 31 December 2019 was $13,449,925 (2018: loss of $5,404,104).

Charitable commitments made throughout the year, within the guidelines agreed by the Board of the Trustee,

totalled $3,035,731 (2018: $3,473,209). Significant changes in the state of affairs There have been no significant changes in the state of affairs during the year. Environmental regulations The Trust’s operations are not subject to any particular or significant environmental regulation under a law of the Commonwealth or State or Territory.


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Trustee’s report (continued) for the year ended 31 December 2019

Events occurring after the reporting date

As at the date of this report, the Trustee is not aware of any matter or circumstance that has arisen since the reporting date that has significantly affected or may significantly affect the Trust’s operations in future years; the results of those operations in future years; or the Trust’s state of affairs in future years which is not already reflected in this report.

Likely developments

There are no anticipated significant changes in the operations of the entity.

Auditor’s independence

The Trustee has obtained an independence declaration from the Trustee’s auditor, Ernst & Young, a copy of which is attached to this report and forms part of the Trustee’s report for the year ended 31 December 2019.

Signed in accordance with a resolution of the directors of AMP Foundation Limited as Trustee of AMP Foundation Charitable Trust

………………………………………….. …………………………………………..

Director Director

Sydney, 19 March 2020

A member firm of Ernst & Young Global Limited Liability limited by a scheme approved under Professional Standards Legislation

Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

Auditor’s Independence Declaration to the trustee of AMP Foundation Charitable Trust

In relation to our audit of the financial report of AMP Foundation Charitable Trust for the financial year ended 31 December 2019, and in accordance with the requirements of Subdivision 60-C of the Australian Charities and Not-for profits Commission Act 2012, to the best of my knowledge and belief, there have been no contraventions of the auditor independence requirements of any applicable code of professional conduct.

Ernst & Young

Clare Sporle Partner 19 March 2020


4

Statement of comprehensive income For the year ended 31 December 2019

Note 2019 2018

$ $

Revenues from operating activities

Distribution income – AMP Foundation 1,436,103 1,887,436

Interest income 9,474 12,465

Dividend income 5,524,901 3,576,470

Other income – franking credit refund 3,284,218 2,580,512

Total Revenues from operating activities 10,254,696 8,056,882

Operating expenses

Payments to Australian charities (3,035,731) (3,473,209)

Investment management fees (225,686) (205,587)

Total Operating expenses (3,261,417) (3,678,796)

Income tax expense 1 (d) - -

Profit for the year 6,993,279 4,378,086

Other comprehensive income recognised in reserves

Items that will not be reclassified subsequently to profit or loss

Asset revaluation reserve

Net gain (loss) on financial assets designated as fair value through other comprehensive income

6,456,646 (9,782,190)

Total comprehensive income (loss) 13,449,925 (5,404,104)


5

Statement of financial position As at 31 December 2019

2019 2018

$ $

Current assets

Cash and cash equivalents 1,823,457 370,059

Receivables

Westpac – interest receivable 155 -

AMP Foundation – final distribution 1,436,103 1,887,436

ATO – GST recoverable - 16,225

Total current assets 3,259,715 2,273,720

Non-current assets

Investments in financial assets 75,114,316 64,059,269

Total non-current assets 75,114,316 64,059,269

Total assets 78,374,031 66,332,989

Current liabilities

AMP Capital Investors Limited – investment management fees 58,310 49,874

ATO - GST Payable 183 -

Payable to AMP Services Limited 445,385 1,862,887

Total current liabilities 503,878 1,912,761

Net assets 77,870,153 64,420,228

Trust’s funds

Initial fund 10 10

Asset revaluation reserve 6,429,589 (1,782,938)

Undistributed funds 71,440,554 66,203,156

Total trust’s funds 77,870,153 64,420,228


6

Statement of changes in Trust’s funds For the year ended 31 December 2019

Initial fund

Asset revaluation

reserve Undistributed

funds Total

$ $ $ $

2019

Balance at the beginning of the year 10 (1,782,938) 66,203,156 64,420,228

Profit - - 6,993,279 6,993,279

Other comprehensive income - 6,456,646 - 6,456,646

Realised gain/loss on investments transferred to undistributed funds

- 1,755,881 (1,755,881) -

Balance at the end of the year 10 6,429,589 71,440,554 77,870,153

2018

Balance at the beginning of the year 10 5,753,398 64,070,924 69,824,332

Profit - - 4,378,086 4,378,086

Other comprehensive loss - (9,782,190) - (9,782,190)

Realised gain/loss on investments transferred to undistributed funds

- 2,245,854 (2,245,854) -

Balance at the end of the year 10 (1,782,938) 66,203,156 64,420,228

Nature and purpose of reserves Asset revaluation reserve Equity investments are designated at fair value through other comprehensive income. Realised and unrealised gains and losses are recognised as Other comprehensive income in the Asset revaluation reserve. On disposal, realised gains and losses are transferred to Undistributed funds. Undistributed funds Undistributed funds is an accumulation of contributions to AMP Foundation Charitable Trust and retained gains and losses.


7

Statement of cash flows For the year ended 31 December 2019

Note 2019 2018

$ $

Cash flows from operating activities

Cash payments to suppliers and charities (4,654,075) (4,810,350)

Investment income 5,524,901 3,576,470

Interest received 9,320 17,281

Other income received 3,284,218 2,580,512

Distribution income - AMP Foundation 1,887,436 1,988,356

Cash flows from operating activities 2 6,051,800 3,352,269

Cash flows from investing activities

Payments for purchase of investments (21,032,112) (36,509,291)

Proceeds from sale of investments 16,433,710 29,430,494

Cash flows from investing activities (4,598,402) (7,078,797)

Net increase (decrease) in cash and cash equivalents 1,453,398 (3,726,528)

Cash and cash equivalents at beginning of year 370,059 4,096,587

Cash and cash equivalents at end of year 1,823,457 370,059


Notes to the financial statements For the year ended 31 December 2019

8

Notes to the financial statements 1. Basis of preparation and summary of significant accounting policies

a) Basis of preparation

AMP Foundation Charitable Trust (the Trust) is not a reporting entity because in the opinion of the Trustee, there are unlikely to exist users of the Financial report who are unable to command the preparation of the reports tailored so as to satisfy specifically all of their information needs. Accordingly, this special purpose Financial report has been prepared to satisfy the Trustee’s reporting requirements under the Trust Deed.

The Trust is a not-for-profit entity for the purposes of preparing financial statements.

The significant accounting policies adopted in the preparation of the Financial report are set out below. These policies have been consistently applied to the current year and comparative period, unless otherwise stated. Where necessary, comparative information has been reclassified to be consistent with current period disclosure.

The Financial report has been prepared in accordance with the recognition and measurement requirements of all applicable Australian Accounting Standards and the disclosure requirements of the following Australian Accounting Standards:

(a) AASB 101 Presentation of Financial Statements;(b) AASB 107 Statement of Cash Flows;(c) AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors;(d) AASB 1048 Interpretation of Standards;(e) AASB 1054 Australian Additional Disclosures.

The Financial report has been prepared on the historical cost basis, except for investments and other financial assets which are initially recognised at fair value and subsequently measured at fair value with any realised and unrealised gains or losses arising from changes in the fair value being recognised in the Statement of comprehensive income in the period in which they arise. The Financial report is presented in Australian dollars.

The Financial report includes financial statements for AMP Foundation Charitable Trust as a single entity.

b) Investments in financial assets

Investments in financial assets at fair value through Other comprehensive income Investments in equities are designated at fair value through other comprehensive income (OCI).

The investments are initially recognised at fair value, being the cost of the consideration given. After initial recognition, investments are measured at fair value reflecting the quoted bid price at balance date.

Changes in fair value are recognised in OCI and are not subsequently reclassified to profit and loss.

i) Impairment of assets

The Trust assesses at each reporting date, whether there is any objective evidence that a financial assets or group of financial assets is impaired. Assets measured at fair value, where changes in value are reflected in the Statement of comprehensive income, are not subject to impairment testing.

ii) Recognition and derecognition of financial instruments

Financial assets are recognised at trade date. Financial assets are derecognised when the contractual rights to the cash flows from the financial assets expire or are transferred. A transfer occurs when substantially all the risks and rewards of ownership of the financial asset are passed to an unrelated third party.



9

(c) Revenue recognition

Revenue is recognised to the extent that it is probable that the economic benefits will flow to the entity and the revenue can be measured reliably. Revenue is recognised for the following business activities as follows:

Dividend Income Dividend revenue is recognised when the right to receive a dividend has been established.

Interest Income Interest income is recognised as the interest accrues using the effective interest rate method.

Distribution Income Distributions from AMP Foundation are recognised when the right to receive the distribution has been established.

(d) Taxes

Income tax The Trust is exempt from tax in accordance with the provisions of the Income Tax Assessment Act of 1997.

Goods and services tax

All revenues, expenses, assets, receivables and payables are recognised net of any GST recoverable.

The net amount of GST recoverable from or payable to the tax authorities is included as a receivable or payable in the statement of financial position.

Cash flows are reported on a gross basis reflecting any GST paid or collected.

(e) Cash and cash equivalents

For the purpose of the Statement of financial position and Statement of cash flows, cash comprises cash on hand that is available on demand and deposits held at call with financial institutions. Cash on hand, deposits at call and bank accounts are carried at fair value, being the principal amount.

(f) Receivables

Receivables are carried at nominal amounts. Given the short-term nature of the receivables, the nominal amount approximates fair value.

(g) Payables

Payables are measured at the nominal amount payable. Given the short-term nature of the payables, the nominal amount payable approximates fair value.



10

2. Notes to the Statement of cash flows

2019 2018

$ $

Reconciliation of cash flows from operating activities

Profit for the year 6,993,279 4,378,086

Non-cash flows in profit:

Decrease in receivables/other assets 467,404 93,749

Decrease in payables (1,408,883) (1,119,566)

Net cash flows from operating activities 6,051,800 3,352,269

3. Auditor’s remuneration

The auditors performed their services pro bono in 2019 and 2018.

4. Events occurring after the reporting date

At the date of this report, the Trustee is not aware of any matter or circumstance that has arisen since the reporting date that has significantly affected or may significantly affect the Trust’s operations in future years; the results of those operations in future years; or the Trust’s state of affairs in future years which is not already reflected in this report.


11

Manager’s Declaration

In accordance with the Trust Deed, the manager declares that:

(a) in the opinion of the manager, there are reasonable grounds to believe that AMP Foundation CharitableTrust will be able to pay its debts as and when they become due and payable; and

(b) in the opinion of the manager, the financial statements and notes of AMP Foundation Charitable Trust forthe financial year ended 31 December 2019 are in accordance with the Trust Deed, including compliancewith accounting standards and satisfy the requirements of the Australian Charities and Not-for-ProfitsCommission Act 2012 and the Australian Charities and Not-for-Profits Commission Regulation 2013 andpresent a true and fair view.

………………………………………….. Helen Liondos Head of AMP Foundation



12

Statement by directors of the trustee company

As detailed in Note 1(a) to the financial statements, AMP Foundation Charitable Trust is not a reporting entity because in the opinion of the directors, there are unlikely to exist users of the Financial report who are unable to command the preparation of the reports tailored so as to satisfy specifically all of their information needs. Accordingly, this special purpose Financial report has been prepared to satisfy the directors’ reporting requirements under the Trust Deed.

In accordance with a resolution of the Directors of AMP Foundation Limited, the directors declare that:

a) in the opinion of directors, there are reasonable grounds to believe that AMP Foundation CharitableTrust will be able to pay its debts as and when they become due and payable; and

b) in the opinion of directors, the financial statements and notes of AMP Foundation Charitable Trust for thefinancial year ended 31 December 2019 are in accordance with the Trust Deed including compliancewith accounting standards and satisfy the requirements of the Australian Charities and Not-for-ProfitsCommission Act 2012 and the Australian Charities and Not-for-Profits Commission Regulation 2013 andpresent a true and fair view.

………………………………………….. …………………………………………..

Director Director



Ernst & Young 200 George Street Sydney NSW 2000 Australia GPO Box 2646 Sydney NSW 2001

Tel: +61 2 9248 5555 Fax: +61 2 9248 5959 ey.com/au

Independent Auditor's Report to the Trustee of AMP Foundation Charitable Trust

Opinion

We have audited the financial report, being a special purpose financial report, of AMP Foundation Charitable Trust (the Trust), which comprises the statement of financial position as at 31 December 2019, the statement of comprehensive income, statement of changes in Trust’s funds and statement of cash flows for the year then ended, notes to the financial statements, including a summary of significant accounting policies, and the manager's declaration.

In our opinion, the accompanying financial report of the Trust is in accordance with the Australian Charities and Not-for-Profits Commission Act 2012, including:

a) giving a true and fair view of the Trust's financial position as at 31 December 2019 and of its financial performance for the year ended on that date; and

b) complying with Australian Accounting Standards to the extent described in Note 1, and the Australian Charities and Not-for-Profits Commission Regulation 2013.

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 Trust in accordance with 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 Note 1 to the financial statements, which describes the basis of accounting. The financial report has been prepared for the purpose of fulfilling the directors’ financial reporting responsibilities under the Australian Charities and Not-for-Profits Commission Act 2012. As a result, the financial report may not be suitable for another purpose. Our opinion is not modified in respect of this matter.

Information Other than the Financial Report and Auditor’s Report Thereon

The directors are responsible for the other information. The other information is the directors’ report accompanying the financial report.


Page 2

Our opinion on the financial report does not cover the other information and accordingly we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial report, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial report or our knowledge obtained in the audit or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Responsibilities of the Directors for the Financial Report

The directors of the Trust 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 Note 1 to the financial statements is appropriate to meet the requirements of the Australian Charities and Not-for-Profits Commission Act 2012 and is appropriate to meet the needs of the members. The directors’ responsibility also includes 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.

In preparing the financial report, the directors are responsible for assessing the Trust’s ability to continue as a going concern, disclosing, as applicable, matters relating to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the Trust 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 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 judgment and maintain professional scepticism throughout the audit. We also:

• Identify and assess the risks 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 Trust’s internal control.

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


Page 3

• Conclude on the appropriateness of the directors’ 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 Trust’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 Trust 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 the directors 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.

Ernst & Young

Clare Sporle Partner Sydney 19 March 2020

amp foundation charitable trust... · 2020-05-22 · amp foundation charitable trust abn 45 237 572...

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