Government Brokered Programs
Funds are received from Government Brokered Programs by KU Childrens Services for the allocation to recipients
who provide a variety of early childhood education and care programs in the community. The entity acts as an
agent for these programs. The funds received and allocated are not recognised in the Statement of Comprehensive
Income in accordance with AASB118 Revenue. Cash flows are included in the Statement of Cash Flows on a gross
basis.
Unit trust distributions and interest revenue
Unit trust distributions from investments are recognised when the unit holder’s right to receive payment has been
established.
Interest revenue is accrued on a time basis, by reference to the principal outstanding and at the effective interest
rate applicable, which is the rate that exactly discounts estimated future cash receipts through the expected life of
the financial assets to that asset’s net carrying amount.
j) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and demand deposits. Cash equivalents are short-term, highly
liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant
risk of changes in value.
k) Investment property
Investment property, which is property held to earn rentals and/or capital appreciation, is carried at cost, including
transaction costs.
l) Income tax
The company is exempt from income tax under s50-5 of the Income Tax Assessment Act, as it is an income tax
exempt charitable entity. As a consequence, there is no income tax attributable to the operating result.
m) General reserves
Fundraising Reserve
Net proceeds of fundraising are retained in the Fundraising Reserve.
n) Donations in kind
Over the course of the year the company has received donations in kind from a number of local councils in the form
of the right to use premises at discounted rent. The company is of the view that it is not feasible to fair value the
services received accurately and as such it has not brought to account discounted rent as a donation.
o) Provisions
Provisions are recognised when the Company has a present obligation (legal or constructive) as a result of a past
event, it is probable that the Company will be required to settle the obligation, and a reliable estimate can be made
of the amount of the obligation.
The amount recognised as a provision is the best estimate of the consideration required to settle the present
obligation at reporting date, taking into account the risks and uncertainties surrounding the obligation. Where a
provision is measured using the cashflows estimated to settle the present obligation, its carrying amount is the
present value of those cashflows.
When some or all of the economic benefits required to settle a provision are expected to be recovered from a third
party, the receivable is recognised as an asset if it is virtually certain that reimbursement will be received and the
amount of the receivable can be measured reliably.
3. Standards and Interpretations issued not yet effective
At the date of authorisation of the financial report, the Standards and Interpretations listed below were in issue but
not yet effective.
Initial application of the following Standards will not affect any of the amounts recognised in the financial report,
but will change the disclosures presently made in relation to the Company’s financial report:
• AASB 1053 Applications of Tiers of Australian Accounting Standards
• AASB 2010-2 Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements
• AASB 2010-4 Further Amendments to Australian Accounting Standards arising from the Annual Improvements Project
Continues...
115th Annual Report 2010
27