AUSTRALIAN ANIMAL HEALTH COUNCIL LIMITED DIRECTORS’ REPORT for the year ended 30 JUNE 2017 Review and result of operations AHA’s income declined to $15.54 million from $16.25 million in 2015/16. Industry member levies were down $1.0m on the prior year at $6.95 million reflecting market conditions and budget. The impact of reduced levy income was offset to some extent by the increases in core subscriptions and special project funding. The one-off recognition of income from taking up 51% of the equity in LBN Pty Ltd, $0.45m, and closing the book on long-completed projects, $0.33m, made up for the one-off Sheep Industry Health & Welfare Trust transfer in 2015/16. Core operations were $4.49 million, up from $4.07 million in 2015/16, following members’ agreement to annual inflationary increases to core subscriptions, ensuring continued quality of key service delivery. Special program expenditure of $9.17 million was substantially lower than 2015/16 at $12.64 million, and lower than budget of $9.59 million. In 2016/17, six projects did not commence, others were substantially under budget. By contrast, in 2015/16 there were substantial over budget positions for surveillance projects in particular, relating to prior year disease cycles. The 2016/17 under-budget projects result has led to a corresponding increase of $2.26 million in the unearned revenue balance, now $4.81 million. An operating surplus of $1.81 million has been delivered against a budgeted deficit of ($0.26 million), and 2015/16 deficit of ($0.52 million). The surplus is reflected in cash, investments and total equity. State of affairs On 2 September 2016, AHA acquired 51% of the share capital in Livestock Biosecurity Network Pty Ltd for nil consideration. In the opinion of directors this is the only significant change in the state of affairs of the company that occurred during the financial year under review, not otherwise disclosed in this report or the financial report. Member commitment on winding up The company is limited by guarantee and in the event of the company being wound up, every member of the company undertakes to contribute an amount not exceeding $100. Auditor’s independence and non-audit services The Auditor’s independence declaration is set out on page 24 and forms part of the directors’ report. During the year, RSM, the company’s auditor, have not performed services in addition to their statutory duties. Directors’ interests and benefits Since the end of the previous financial year, no director has received or become entitled to receive any benefit (other than a benefit included in the aggregate amount of remuneration received by or due to directors shown in the financial statements) by reason of a contract made by the company or a related company with a director or with a firm of which they are a member, or have a substantial financial interest. Insurance of officers and directors Insurance premiums of $6,842 have been paid in 2016/17 on behalf of its directors and officers for professional liability insurance. The policies relate to costs incurred in defending proceedings, civil or criminal, whatever their outcome, and other liabilities arising from their position with the exception of conduct involving a wilful breach of duty or improper use of information or position to gain a personal advantage. Signed in Canberra on 20 September 2017 in accordance with a resolution of directors: Peter Milne Chairman - 5 - Sharon Starick Director 86 ANNUAL REPORT 2016-17
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