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A n n u A l R e p o R t | 2 0 1 3Financial Statements

CHARLES DARWIN UNIVERSITY AND ITS CONTROLLED ENTITIES

2013 FINANCIAL STATEMENTS

2 CDU FINANCIAL STATEMENTS 2013

CHARLES DARWIN UNIVERSITY AND ITS CONTROLLED ENTITIESREPORT BY MEMBERS OF COUNCIL

3 CDU 2013 FINANCIAL STATEMENTS

A B A B A B A B A B6 6 6 6 4 4 5 5 1 15 6 5 6 4 4 4 5 1 16 6 6 6 4 4 4 5 1 12 2 1 25 5 6 6 1 14 6 3 6 4 4 1 15 5 6 62 64 6 3 45 6 3 43 35 66 66 64 4 3 3

Principal ActivitiesDuring the year, the principal continuing activities of the consolidated entity were:a)

b)

c)d)

e) f)g)h)

i)

j)

to provide library and other educational facilities that may be used by the public on conditions as determined by theCouncil; andto carry out any other function that is conferred on it by or under the Charles Darwin University Act or any other Act.

Development

to administer schemes of financial and other assistance for students of the University and persons studying or carryingout research at the University including, in the case of students, financial assistance in the form of loans;

Rose McEldowneyKingsley BrentonSteve Shanahan

A = Number of meetings attendedB = Number of meetings held during the time the member held office or was a member of the committee during the year

to undertake teaching activities that fulfil the requirements of an undergraduate and postgraduate universityeducation and training and further education by way of a course of instruction that is, or is preparatory to, a course ofa kind relevant to a trade, technical or other vocational education;to undertake research (taking advantage of the human and physical resources of the University) and, whereappropriate, to consider commercial exploitation of research that is undertaken;to undertake teaching activities to provide other education and training as determined by the Council;to co-operate with other universities and with institutions of higher education, training and further education orresearch (whether within or outside of Australia);

Justin Busse

Sally Thomas AMRichard Ryan AOBarney GloverSandra DunnJennifer Prince PSMAlan MorrisNeil RossElliot McAdamMary O'KaneMatthew GardinerKen Davies

and Legislation

Meetings of Members

The number of meetings of the members of the Council of Charles Darwin University and each Council committee held during theyear ended 31 December 2013, and the number of meetings attended by each member were:

Meetings of CommitteesCouncil Finance and Audit and Nominations Executive

Meetings Infrastructure Risk Honorary Awards

to liaise with industry and professional organisations, training committees and the community;to disseminate knowledge and advance skills and their practical application;to provide consultative and research services and facilities;



Members

Professor Barney Glover

Professor Sandra Dunn

Associate Professor Steve Shanahan

Professor Mary O'Kane

Mr Elliott McAdam

Mrs Jennifer Prince PSM

Mr Neil Ross

Mr Richard Ryan AO

Mr Alan Morris

Mr Matthew Gardiner

Mr Ken Davies

Professor Rose McEldowney

Mr Justin Busse

Mr Kingsley Brenton

appointed a member on 25 January 2009 and continues in office at the date of thisreport

appointed a member on 24 June 2009 and continues in office at the date of this report

appointed a member on 28 June 2013 and continues in office at the date of this report

appointed a member on 1 January 2011 and continued in office until the expiry of theterm of office on 31 December 2013


appointed a member on 1 January 2008 and concluded the term in office on 30 June2013

The members of the Council of Charles Darwin University present their report on the consolidated entity and the entities itcontrolled at the end of, or during, the year ended 31 December 2013.

The following persons were members of the Council of Charles Darwin University during the whole of the year and up to the date of this report:

Her Honour, the Honourable Sally Thomas AM

appointed Chancellor on 1 January 2010 and continues in office at the date of thisreport

appointed a member on 23 February 2009 and continues in office at the date of thisreport


appointed a member on 1 July 2013 and continues in office until the date of this report


appointed a member on 25 January 2009 and and continues in office at the date of thisreport

appointed a member on 11 November 2010 and concluded the term in office on 11November 2013

appointed a member on 11 November 2010 and concluded the term in office on 11November 2013

appointed a member on 15 March 2010 and continues in office at the date of thisreport

CDU FINANCIAL STATEMENTS 2013 3



A B A B A B A B A B6 6 6 6 4 4 5 5 1 15 6 5 6 4 4 4 5 1 16 6 6 6 4 4 4 5 1 12 2 1 25 5 6 6 1 14 6 3 6 4 4 1 15 5 6 62 64 6 3 45 6 3 43 35 66 66 64 4 3 3

Principal ActivitiesDuring the year, the principal continuing activities of the consolidated entity were:a)

b)

c)d)

e) f)g)h)

i)

j)

to provide library and other educational facilities that may be used by the public on conditions as determined by theCouncil; andto carry out any other function that is conferred on it by or under the Charles Darwin University Act or any other Act.

Development

to administer schemes of financial and other assistance for students of the University and persons studying or carryingout research at the University including, in the case of students, financial assistance in the form of loans;

Rose McEldowneyKingsley BrentonSteve Shanahan

A = Number of meetings attendedB = Number of meetings held during the time the member held office or was a member of the committee during the year

to undertake teaching activities that fulfil the requirements of an undergraduate and postgraduate universityeducation and training and further education by way of a course of instruction that is, or is preparatory to, a course ofa kind relevant to a trade, technical or other vocational education;to undertake research (taking advantage of the human and physical resources of the University) and, whereappropriate, to consider commercial exploitation of research that is undertaken;to undertake teaching activities to provide other education and training as determined by the Council;to co-operate with other universities and with institutions of higher education, training and further education orresearch (whether within or outside of Australia);

Justin Busse

Sally Thomas AMRichard Ryan AOBarney GloverSandra DunnJennifer Prince PSMAlan MorrisNeil RossElliot McAdamMary O'KaneMatthew GardinerKen Davies

and Legislation

Meetings of Members

The number of meetings of the members of the Council of Charles Darwin University and each Council committee held during theyear ended 31 December 2013, and the number of meetings attended by each member were:

Meetings of CommitteesCouncil Finance and Audit and Nominations Executive

Meetings Infrastructure Risk Honorary Awards

to liaise with industry and professional organisations, training committees and the community;to disseminate knowledge and advance skills and their practical application;to provide consultative and research services and facilities;




Review of Operations

Introduction

Capital Works

--

---

-----

Palmerston Residential Estate

Specific Purpose Grants

- $25.7M- $7.5M- $4.0M

Significant Changes in the State of Affairs

Matters Subsequent to the End of the Financial Year

Likely Developments and Expected Results of Operations

Likely developments in the operations of the economic entity and the expected results of those operations in future financialyears have not been included in this report as the inclusion of such information is likely to result in unreasonable prejudice to theeconomic entity.

Trades Training BuildingDemountable units for Accommodation at Katherine CampusLevel 11, 815 George Street Sydney

The residential development, known as The Heights, Durack progressed during 2013 with titles issued for 101 blocks by 31December 2013. The development will include a neighbourhood centre, parklands, wetland as well as a retirement village. Workswill continue during 2014.

Included in the 2013 surplus amount of $32 million is capital funding received of $37.2 million that is committed to fund specificcapital projects in 2013 and future years. This funding was received as specific purpose grant funds from the Federal andNorthern Territory Governments. The bulk of this funding was for the Menzies School of Health Research buildings' grants.

Capital funding received in 2013 and recorded as revenue included specific grants for the following projects:

Trades Training Centre Facility

The University also received $7 million in 2013 from the Structural Adjustment Fund which is for a range of activities aimed atimproving sustainability in the deregulated, demand-driven environment.

No significant changes in the economic entity's state of affairs occurred during the financial year.

No matters or circumstances have arisen since the end of the financial year which significantly affected or may significantlyaffect the operations of the economic entity, the results of those operations, or the state of the affairs of the economic entity infuture financial years.

Menzies School of Health Research buildings' at Charles Darwin University and the Royal Darwin Hospital

Northern Territory Government Capital funding

Bicycle Pod

The University had a successful year achieving a pleasing AUQA audit outcome and ASQA re-registration. The University’s highlevel of research intensity was reflected in the University achieving a ranking of 306 in the Times Higher Education World Rankingof universities.

Construction was completed on the following capital projects during 2013:Library RefurbishmentNTG Health Workers Accommodation

Structural Load Testing Facility ShedSolar Power Charging StationLevel 2, 104 Franklin Street Melbourne and Level 10, 815 George Street Sydney

Construction commenced or was continuing on the following capital projects during 2013:

Waterfront Education and Training Facility




Environmental Regulation

- Gene Technology Act 2000 and Gene Technology Regulations 2001- Gene Technology (Northern Territory) Act 2004- Radiation Protection Act 2009 and Radiation Protection Regulations 2011- Dangerous Goods Act 2012 and Dangerous Goods Regulations 2012- Transport of Dangerous Goods by Rail and Road (National Uniform Legislation) Act 2010- Waste Disposal on Royal Darwin Hospital Campus Regulations- Waste Management and Pollution Control Act 2011 and Regulations- International Air Transport Association (IATA) Dangerous Goods Regulations

Insurance of officers

Proceedings on behalf of the entity

CHANCELLOR VICE-CHANCELLOR

The economic entity is subject to the following environmental regulations:

The economic entity has insurance in place to insure the members of the Council and its Committees and the Officers againstclaims arising from their involvement in the activities of the economic entity. The cover for Menzies School of Health Research is$5 million and for Charles Darwin University is $10 million.

There were no material proceedings ongoing against the University at the end of 2013.

This report is made in accordance with a resolution of the members of the Council.

Signed at Darwin this day of 2014


CHARLES DARWIN UNIVERSITY AND ITS CONTROLLED ENTITIESANNUAL FINANCIAL REPORT - 31 DECEMBER 2013


Contents Page

7

8

9

10

11

12

64

65

Notes to the Financial Statements

Certifications

Auditor's Report

The financial report was authorised for issue by the members on 15 May 2014. The Council of Charles Darwin University has the power to amend and reissue the financial report.

Financial Report Income Statement

Statement of Comprehensive Income

Statement of Financial Position

Statement of Changes in Equity

Statement of Cash Flows

CDU FINANCIAL STATEMENTS 2013 77CDU 2013 FINANCIAL STATEMENTS


INCOME STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2013

Note2013 2012 2013 2012$'000 $'000 $'000 $'000

Income from continuing operations Australian Government financial assistance Australian Government grants 3 142,048 124,344 99,094 106,351 HECS - HELP Australian Government payments 3 21,549 17,776 21,549 17,776 FEE - HELP 3 357 548 357 548 SA - HELP 3 555 262 555 262 NT Government financial assistance 4 66,168 65,737 61,188 59,781 HECS - HELP student payments 5,399 5,621 5,401 5,628 Fees and charges 5 27,214 21,899 29,790 23,544 Investment revenue and income 6 6,002 7,296 3,973 5,077 Consultancy and contracts 7 22,427 24,087 15,792 17,271 Other revenue and income 8 38,821 23,967 37,504 19,198

Total revenue from continuing operations 330,540 291,537 275,203 255,436

Gain/(loss) on disposal of assets 28 1,089 408 1,078 407

Total income from continuing operations 331,629 291,945 276,281 255,843

Expenses from continuing operations Employee-related expenses 9 160,178 152,151 135,911 127,339 Depreciation and amortisation 10 18,822 16,462 18,531 16,110 Repairs and maintenance 11 8,290 7,165 7,524 6,424 Impairment of assets 12 630 360 630 358 Other expenses 13 111,718 88,418 103,194 80,129

Total expenses from continuing operations 299,638 264,556 265,790 230,360

Operating result before income tax 31,991 27,389 10,491 25,483

Income tax expense 1(w) - - - -

Operating result after income tax for the period 31,991 27,389 10,491 25,483

Operating result attributable to non- - - - - controlling interest

Operating result attributable to membersof Charles Darwin University 31,991 27,389 10,491 25,483

Consolidated Parent Entity

The above Income Statement should be read in conjunction with the accompanying notes.

8 CDU FINANCIAL STATEMENTS 2013 8

CDU 2013 FINANCIAL STATEMENTS


STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 DECEMBER 2013

Note2013 2012 2013 2012$'000 $'000 $'000 $'000

Operating result after income tax for the period 31,991 27,389 10,491 25,483Items that may be reclassified to profit or lossGain/(loss) on value of available for sale financial assets, net of tax 29 55 39 - -

32,046 27,428 10,491 25,483

Items that will not be reclassified to profit or lossGain/(loss) on revaluation on land and buildings, net of tax 29 19,844 21,320 19,844 21,320Total other comprehensive income 19,844 21,320 19,844 21,320Total comprehensive income 51,890 48,748 30,335 46,803

Total comprehensive income attributable to non-controlling interest - - - -Total comprehensive income attributable to members of Charles Darwin University 51,890 48,748 30,335 46,803


The above Statement of Comprehensive Income should be read in conjunction with the accompanying notes.


9CDU 2013 FINANCIAL STATEMENTS


STATEMENT OF FINANCIAL POSITION AS AT 31 DECEMBER 2013

Note2013 2012 2013 2012$'000 $'000 $'000 $'000

ASSETSCurrent assets Cash and cash equivalents 14 130,958 130,789 97,778 89,339 Receivables 15 10,759 9,102 8,456 7,002 Inventories 16 997 1,002 997 1,002 Other financial assets 19 1,959 4,595 785 1,524 Non-current assets classified as held for sale 20 12,421 24,000 12,421 24,000 Other non-financial assets 21 6,307 5,376 5,994 5,114

Total current assets 163,401 174,864 126,431 127,981

Non-current assets Biological assets 17 3,190 2,495 3,190 2,495 Investment property 18 300 260 - - Other financial assets 19 279 224 - - Property, plant and equipment 22 488,487 411,840 453,479 404,084 Intangible assets 23 - 78 - 78

Total non-current assets 492,256 414,897 456,669 406,657

Total assets 655,657 589,761 583,100 534,638

LIABILITIESCurrent liabilities Trade and other payables 24 9,158 11,103 11,505 8,676 Borrowings 25 2,000 - 2,000 - Provisions 26 23,050 21,438 19,885 18,817 Other liabilities 27 6,540 4,023 6,142 3,989

Total current liabilities 40,748 36,564 39,532 31,482

Non-current liabilities Borrowings 25 16,000 6,000 16,000 6,000 Provisions 26 2,101 2,279 1,811 1,734

Total non-current liabilities 18,101 8,279 17,811 7,734

Total liabilities 58,849 44,843 57,343 39,216

Net assets 596,808 544,918 525,757 495,422

Equity Reserves 29(a) 235,581 216,974 225,429 205,877 Restricted funds 29(b) 39,856 48,378 39,856 48,378 Retained earnings 29(c) 321,371 279,566 260,472 241,167

Total equity 596,808 544,918 525,757 495,422


The above Statement of Financial Position should be read in conjunction with the accompanying notes.




STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 DECEMBER 2013

Total$'000 $'000 $'000 $'000

ConsolidatedBalance at 1 January 2012 31,639 196,218 268,313 496,171Profit or loss - - 27,389 27,389Other comprehensive income - 21,359 - 21,359Total comprehensive income - 21,359 27,389 48,748Transfers (to)/from restricted reserves 16,739 - (16,739) -Transfers (to)/from revaluation reserves - (603) 603 -Balance at 31 December 2012 48,378 216,974 279,566 544,918

Balance at 1 January 2013 48,378 216,974 279,566 544,918Profit or loss - - 31,991 31,991Other comprehensive income - 19,899 - 19,899Total comprehensive income - 19,899 31,991 51,890Transfers (to)/from restricted reserves (8,522) - 8,522 -Transfers (to)/from revaluation reserves - (1,292) 1,292 -Balance at 31 December 2013 39,856 235,581 321,371 596,808

ParentBalance at 1 January 2012 31,639 184,600 232,380 448,619Profit or loss - - 25,483 25,483Other comprehensive income - 21,320 - 21,320Total comprehensive income - 21,320 25,483 46,803Transfers (to)/from restricted reserves 16,739 - (16,739) -Transfers (to)/from revaluation reserves - (43) 43 -Balance at 31 December 2012 48,378 205,877 241,167 495,422

Balance at 1 January 2013 48,378 205,877 241,167 495,422Profit or loss - - 10,491 10,491Other comprehensive income - 19,844 - 19,844Total comprehensive income - 19,844 10,491 30,335Transfers (to)/from restricted reserves (8,522) - 8,522 -Transfers (to)/from revaluation reserves - (292) 292 -Balance at 31 December 2013 39,856 225,429 260,472 525,757

Restricted Funds

Reserves Retained Earnings

The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.




STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 31 DECEMBER 2013

Note2013 2012 2013 2012$'000 $'000 $'000 $'000

Cash flows from operating activities Australian Government grants 3(i) 164,509 142,930 121,555 124,936 OS-HELP (net) 3(i) 18 2 18 2 Superannuation supplementation 3(i) 22 19 22 19 State Government grants 72,785 72,311 67,307 65,759 HECS-HELP student payments 5,399 5,621 5,401 5,628 Receipts from student fees and other customers 101,460 72,399 91,119 67,395 Interest received 6,629 6,489 4,572 4,590 Proceeds from sale of biological assets 387 375 387 375 Payments to suppliers and employees (300,267) (255,794) (258,700) (227,737)

Net cash provided by / (used in) operating activities 39 50,942 44,352 31,681 40,967

Cash flows from investing activities Proceeds from sale of property, plant and equipment 3,082 530 3,059 529 Payments for property, plant and equipment (65,962) (45,461) (38,408) (40,440) Payments for biological assets (33) (19) (33) (19) Loans to joint ventures 140 107 140 107

Net cash provided by / (used in) investing activities (62,773) (44,843) (35,242) (39,823)

Cash flows from financing activities Proceeds from borrowings 12,000 6,000 12,000 6,000

Net cash provided by / (used in) financing activities 12,000 6,000 12,000 6,000

Net increase / (decrease) in cash and cash equivalents 169 5,509 8,439 7,144

Cash and cash equivalents at the beginning of the financial year 14 130,789 125,280 89,339 82,195

Cash and cash equivalents at the end of the financial year 14 130,958 130,789 97,778 89,339


The above Statement of Cash Flows should be read in conjunction with the accompanying notes.


CHARLES DARWIN UNIVERSITY AND ITS CONTROLLED ENTITIESANNUAL FINANCIAL REPORT - 31 DECEMBER 2013


Note Contents of the notes to the financial statements12

3 Australian Government financial assistance including HECS-HELP and other Australian Government loan programs

4 Northern Territory Government financial assistance5 Fees and charges6 Investment revenue and income7 Consultancy and contracts8 Other revenue and income

9 Employee-related expenses10 Depreciation and amortisation11 Repairs and maintenance12 Impairment of assets13 Other expenses

14 Cash and cash equivalents15 Receivables16 Inventories17 Biological assets18 Investment properties19 Other financial assets20 Non-current assets and disposal groups classified as held for sale21 Other non-financial assets22 Property, plant and equipment23 Intangible assets

24 Trade and other payables25 Borrowings26 Provisions27 Other liabilities28 Gain/(loss) on disposal of assets

Equity29 Reserves, restricted funds and retained earnings30 Key management personnel disclosures31 Remuneration of auditors32 Contingencies33 Commitments34 Related parties35 Subsidiaries36 Jointly controlled operations and assets37 Economic dependency38 Events occurring after the balance sheet date39 Reconciliation of operating result after income tax to net cash flows from operating activities40 Financial risk management41 Acquittal of Australian Government financial assistance

Liabilities

Summary of significant accounting policiesDisaggregated informationIncome

Expenses

Assets


CHARLES DARWIN UNIVERSITY AND ITS CONTROLLED ENTITIESNOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2013


Date of authorisation for issue

Historical cost convention

Critical accounting estimates

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The principal address of Charles Darwin University is Ellengowan Drive, Casuarina, Darwin.

(a) Basis of preparation

Charles Darwin University was enacted as a Body Corporate on 5 November 2003 by the Charles Darwin University Act 2003 (the Act) and is domiciled in Australia. The University is subject to all directions of the Council of the University. The functions of the University are set out in Section 5 of the Act. Under the provisions of the Act, at its commencement, Charles Darwin University assumed all the property, rights and liabilities of Northern Territory University, Centralian College (Alice Springs based), and Northern Territory Rural College (Katherine based), except for the superannuation liability for Centralian College which remained with the Northern Territory Government's Central Holding Authority. Subsequently as per the Charles Darwin University Act 2003 and amendment to the Menzies School of Health Research Act, the Menzies School of Health Research became a controlled entity of the University from 1 January 2004.

The principal accounting policies adopted in the preparation of these financial statements is set out below. These policies have been consistently applied for all years reported, unless otherwise stated. The financial statements include separate statements of Charles Darwin University as the parent entity and the consolidated entity consisting of Charles Darwin University and its subsidiaries.

The annual financial statements represent the audited general purpose financial statements of Charles Darwin University. They have been prepared on an accrual basis and comply with Australian Accounting Standards, AASB Interpretations, the requirements of the Department of Education and other State/Australian Government legislative requirements.

Charles Darwin University is a not-for-profit entity and these statements have been prepared on that basis. Some of the Australian Accounting Standards requirements for not-for-profit entities are inconsistent with the IFRS requirements.

The financial statements were authorised for issue by the members' Council of Charles Darwin University on 15 May 2014.

These financial statements have been prepared under the historical cost convention, as modified by the revaluation of available-for-sale financial assets, financial assets and liabilities at fair value through profit or loss, certain classes of property, plant and equipment and investment property.

(b) Basis of consolidation(i) Subsidiaries

The preparation of financial statements in conformity with Australian Accounting Standards requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the Charles Darwin University's accounting policies. The estimates and underlying assumptions are reviewed on an ongoing basis. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements, are disclosed below.

The consolidated financial statements incorporate the assets and liabilities of all subsidiaries of Charles Darwin University ("parent entity") as at 31 December 2013 and the results of all subsidiaries for the year then ended. Charles Darwin University and its subsidiaries together are referred to in this financial report as the Group or the consolidated entity.

Subsidiaries are all those entities (including special purpose entities) over which the Group has the power to govern the financial and operating policies, generally accompanying a shareholding of more than one-half of the voting rights. The existence and effect of potential voting rights that are currently exercisable or convertible are considered when assessing whether the Group controls another entity.

Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are de-consolidated from the date that control ceases.




(ii) HELP payments

(iii) Student fees and charges

Charles Darwin University treats operating grants received from Australian Government entities as income in the year of receipt. Grants from the government are recognised at their fair value where the Group obtains control of the right to receive the grant, it is probable that economic benefits will flow to the Group and it can be reliably measured.

Revenue from HELP is categorised into those received from the Australian Government and those received directly from students. Revenue is recognised and measured in accordance with the above disclosure.

Fees and charges are recognised as income in the year of receipt, except to the extent that fees and charges relate to courses to be held in future periods. Such receipts (or portion thereof) is treated as income in advance in liabilities. Conversely, fees and charges relating to debtors are recognised as revenue in the year to which the prescribed course relates.

The results and financial position of all the University entities are presented in Australian dollars.

(d) Revenue recognition

Revenue is recognised for the major business activities as follows:

(i) Government grants

(c) Foreign currency translation(i) Functional and presentation currency

(ii) Transactions and balances

(iii) Group entities

Items included in the financial statements of each of the Group's entities are measured using the currency of the primary economic environment in which the entity operates ('the functional currency'). The consolidated financial statements are presented in Australian dollars, which is Charles Darwin University's functional and presentation currency.

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. Amounts receivable and payable in foreign currencies are translated at the rate of exchange ruling at balance date. Translation differences on non-monetary financial assets and liabilities are recognised in the income statement as part of the fair value gain or loss.

Revenue is measured at the fair value of the consideration received or receivable. Amounts disclosed as revenue are net of returns, trade allowances, rebates and amounts collected on behalf of third parties.

The Group recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the Group and specific criteria have been met for each of the Group's activities as described below. The amount of revenue is not considered to be reliably measurable until all contingencies relating to the sale have been resolved. The Group bases its estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement.

The interests in joint venture entities are accounted for in the financial statements of the parent. The share of the income, expenditure, assets and liabilities of the joint venture entities is recognised in the financial statements in the proportion held by Charles Darwin University. Details relating to joint ventures are set out in Note 36.

NOTE 1: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Continued

- Charles Darwin University - Charles Darwin University Foundation Trust - Menzies School of Health Research - CDU Amenities Limited

(ii) Joint venturesJoint venture entities

Entities controlled by Charles Darwin University and forming part of the Charles Darwin University consolidated entity are as follows:




(iv) Rendering of services

(vi) Contribution of assets

(vii) Liabilities forgiven

(h) Trade receivables

(f) Leases

(g) Impairment of assets

For statement of cash flow presentation purposes, cash and cash equivalents includes cash-on-hand, deposits held at call with financial institutions, other short-term, highly liquid investments with original maturities of twelve months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value.

Leases of property, plant and equipment where the Group, as lessee, has substantially all the risks and rewards of ownership are classified as finance leases, are capitalised at the lease's inception at the lower of the fair value of the leased property and the present value of the minimum lease payments. The property, plant and equipment acquired under finance leases is depreciated over the shorter of the leased item's useful life and the lease term (using the straight-line method).

Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight line basis over the lease term. Lease expenditure relating to leases deemed to be "operating leases" is expensed as incurred.

Intangible assets that have an indefinite useful life are not subject to amortisation and are tested annually for impairment. Other assets that are subject to amortisation are reviewed whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset's carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset's fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows which are largely independent of the cash inflows from other assets or groups of assets (cash generating units). Non-financial assets other than goodwill that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

Trade receivables are recognised initially at fair value being original invoice amount, subsequently measured at amortised cost, less provision for impairment. Trade receivables are due for settlement within no more than 30 days.

Collectability of trade receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. A provision for impairment of receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables. Significant financial difficulties of the debtor, probability that the debtor will enter bankruptcy or financial reorganisation, and default or delinquency in payments (more than 30 days overdue) are considered indicators that the trade receivable is impaired. The amount of the provision is the difference between the asset's carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. Cash flows relating to short-term receivables are not discounted if the effect of discounting is immaterial. The amount of the provision is recognised in the income statement.

(v) Sale of goods and disposal of assets

The gross amount of a liability forgiven by a credit provider is recognised as revenue.

(e) Cash and cash equivalents


Revenue from a contract to provide services is recognised by reference to the stage of completion of the contract, as determined within the individual contracts.

Revenue from the sale of goods and disposal of assets is recognised when the entity has passed control to the buyer.

Revenue arising from the contribution of assets is recognised when the entity gains control of the contribution or the right to receive the contribution.




(iv) Available-for-sale financial assets

Subsequent measurement

Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Group's management has the positive intention and ability to hold to maturity.

Available-for-sale financial assets, comprising principally marketable equity securities, are non-derivatives that are either designated in this category or not classified in any of the other categories. They are included in non-current assets unless management intends to dispose of the investment within twelve months of the balance sheet date.

Available-for-sale financial assets and financial assets at fair value through profit and loss are subsequently carried at fair value. Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method. Gains or losses arising from changes in the fair value of the 'financial assets at fair value through profit or loss' category are included in the income statement within other income or other expenses in the period in which they arise.

Changes in the fair value of a monetary security denominated in a foreign currency and classified as available-for-sale are analysed between translation differences resulting from changes in amortised cost of the security and other changes in the carrying amount of the security (other than interest). The translation differences related to changes in the amortised cost are recognised in profit or loss, and other changes in carrying amount (other than interest) are recognised in equity. Changes in the fair value of other monetary and non-monetary securities classified as available-for-sale are recognised in equity.

(i) Financial assets at fair value through profit or loss

(ii) Loans and receivables

(iii) Held-to-maturity investments

(j) Non-current assets (or disposal groups) held for sale and discontinued

(k) Investments and other financial assets

Classification

Raw materials and stores, work in progress and finished goods are stated at the lower of cost and net realisable value. Cost comprises direct materials and direct labour. Costs of purchased inventory are determined after deducting rebates and discounts. Net realisable value represents the estimated selling price for inventories less all estimated costs of completion and costs necessary to make the sale.

Non-current assets (or disposal groups) are classified as held for sale and stated at the lower of their carrying amount and fair value less costs of disposal, if their carrying amount will be recovered principally through a sale transaction rather than through continuing use.

Non-current assets classified as held for sale and the assets of a disposal group classified as held for sale are presented separately from the other assets in the balance sheet. The liabilities of a disposal group classified as held for sale are presented separately from other liabilities in the balance sheet.

The Group classifies its investments in the following categories: financial assets at fair value through profit or loss, loans and receivables, held-to-maturity investments, and available-for-sale financial assets. The classification depends on the purpose for which the investments were acquired. Management determines the classification of its investments at initial recognition and, in the case of assets classified as held-to-maturity, re-evaluates this designation at each reporting date.

Financial assets at fair value through profit or loss include financial assets held for trading. A financial asset is classified in this category if it is acquired principally for the purpose of selling in the short term. The University does not enter into derivative contracts. Assets in this category are classified as current assets.

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. They are included in current assets, except for those with maturities greater than twelve months after the balance sheet date which are classified as non-current assets. Loans and receivables are included in receivables in the balance sheet.


(i) Inventories




Livestock

(l) Biological assets

(m) Property, plant and equipment

The fair value of assets and liabilities must be measured for recognition and disclosure purposes.

The Group classifies fair value measurements using a fair value hierarchy that reflects the significance of inputs used in making the measurements.

The fair value of assets or liabilities traded in active markets is based on quoted market prices for identical assets or liabilities at the balance sheet date. The quoted market price used for assets held by the Group is the most representative of fair value in the circumstances within the bid-ask spread.

The fair value of instruments that are not traded in an active market is determined using valuation techniques. The Group uses a variety of methods and makes assumptions that are based on market conditions existing at each balance date.

Fair value measurement of non-financial assets is based on the highest and best use of the asset. The Group considers market participants use of, or purchase price of the asset, to use it in a manner that would be highest and best use.

The carrying value less impairment provision of trade receivables and payables are assumed to approximate their fair values due to their short-term nature. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Group for similar financial instruments.

Livestock consists of cattle and horses located at Katherine Campus and Mataranka Station. Livestock are measured at their fair value less estimated point of sale costs. The fair value of the livestock is determined by an independent valuation based on market prices for livestock in the local area, at the time of sale. Changes in the fair value less estimated point of sale costs are recognised in the income statement in the year they arise plus purchases of livestock are recorded as cash flows used in investing activities. Further details are disclosed in Note 17.

Land and buildings (except for investment properties - refer to Note 18) are shown at fair value, based on periodic, but at least triennial, valuations by external independent valuers, less subsequent depreciation for buildings. Any accumulated depreciation at the date of revaluation is eliminated against the gross carrying amount of the asset and the net amount is restated to the revalued amount of the asset. All other property, plant and equipment is stated at historical cost less depreciation. Historical cost includes expenditure that is directly attributable to the acquisition of the items.

Subsequent costs are included in the asset's carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.


Fair value

Impairment

Fair value measurement

The fair values of investments and other financial assets are based on quoted prices in an active market. If the market for a financial asset is not active (and for unlisted securities), the Group establishes fair value by using valuation techniques, that maximise the use of relevant data. These include reference to the estimated price in an orderly transaction that would take place between market participants at the measurement date. Other valuation techniques used are the cost approach and the income approach based on the characteristics of the asset and the assumptions made by market participants.

The Group assesses at each balance date whether there is objective evidence that a financial asset or group of financial assets is impaired. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of a security below its cost is considered in determining whether the security is impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss - measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised in profit and loss - is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments are not reversed through the income statement.




2013 2012 Buildings including demountables

50 years 50 years

Building improvements 5-50 years 5-50 years Leasehold improvements Useful life or unexpired

period of the lease, whichever is shorter

N/A

Plant and equipment 3-8 years 3-8 years Library books and periodicals 10 years 10 years Furniture and fittings 5 years 5 years Motor vehicles 3-4 years 3-4 years Intangible assets 5 years 5 years

Borrowings are classified as current liabilities unless the Group has an unconditional right to defer settlement of the liability for at least 12 months after the balance sheet date and does not expect to settle the liability for at least 12 months after the balance sheet date.

Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the income statement over the period of the borrowings using the effective interest method. Fees paid on the establishment of loan facilities, which are not incremental cost relating to the actual draw-down of the facility, are recognised as prepayments and amortised on a straight-line basis over the term of the facility.

Borrowings are removed from the balance sheet when the obligation specified in the contract is discharged, cancelled or expired. The difference between the carrying amount of a financial liability that has been extinguished or transferred to another party and the consideration paid, including any non-cash assets transferred or liabilities assumed, is recognised in other income or other expenses.


(o) Trade and other payables

(p) Borrowings

(n) Intangible assets

Increases in the carrying amounts arising on revaluation of land and buildings are recognised, net of tax, in other comprehensive income and accumulated in equity under the heading revaluation surplus. Decreases that reverse previous increases of the same asset are also firstly recognised in other comprehensive income before reducing the balance of revaluation surpluses in equity, to the extent of the remaining reserve attributable to the asset; all other decreases are charged to the income statement.

Land and Works of Art are not depreciated. Depreciation on other assets is calculated using the straight line method to allocate their cost or revalued amounts, net of their residual values, over their estimated useful lives, as follows:

The assets' residual values and useful lives are reviewed, and adjusted if appropriate, at each balance sheet date. An asset's carrying amount is written down immediately to its recoverable amount if the asset's carrying amount is greater than its estimated recoverable amount.

Charles Darwin University has adopted the policy of revaluing its land and buildings once every three years unless there is a material change in the market value. Colliers International NT carried out a physical valuation of land and buildings as at 31 December 2013 (2012: desktop valuation). The basis of the valuation was fair value methodology. The fair value of an asset generally equates to the asset's market price and where reliable evidence was not available the asset's replacement cost has been assumed to be its fair value. Land improvements were valued by Colliers International NT in December 2013 using fair value methodology. All additions during 2013 have been recorded at cost which equates approximately to fair value. The Palmerston Campus freehold land revaluation is disclosed in Note 22.

The library and works of art collections were revalued by Colliers International NT in December 2013. The basis of the valuation was fair value.

Licenses have a finite useful life and are carried at cost less accumulated amortisation and impairment losses. Amortisation is calculated using the straight-line method to allocate the cost of licenses over their estimated useful lives.

These amounts represent liabilities for goods and services to the University prior to the end of the financial year and which are unpaid. The amounts are unsecured and are normally paid within 30 days of recognition.




(ii) Other long-term obligations

The Group does not have any retirement benefit obligations.

(v) Termination benefits

(vi) Changes in accounting policy

Termination benefits are payable when employment is terminated before the normal retirement date, or when an employee accepts an offer of benefits in exchange for the termination of employment. The Group recognises termination benefits when it can no longer withdraw the offer of those benefits or when it has recognised costs for restructuring within the scope of AASB137 that involves the payment of termination benefits when it demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility or withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits not expected to be settled wholly before twelve months after the reporting period are discounted to present value.

The adoption of the revised AASB 119 resulted in changes to the Charles Darwin University accounting policy which affected items recognised in the financial statements. The revised standard changed the accounting for employee obligations, namely annual leave. As the entity does not expect the annual leave obligation to be settled wholly within 12 months from the end of the reporting period, it is classified as long-term benefits in its entirety. This has changed measurement of the obligation as it is not measured on a discounted basis and no longer split into short and long term portions. This has not had a material impact on the value of the obligation as the majority of leave is still expected to be taken within a short timeframe after the end of the reporting period.

The adoption of this revised standard decreased the employee benefits expense for the annual reporting period ending 31 December 2013 by $240,550 ($197,094 for the reporting period ending 31 December 2012).

(iii) Profit-sharing and bonus plans

(iv) Retirement benefit obligations


(q) Borrowing costs

(r) Employee benefits(i) Short-term obligations

Borrowing costs incurred for the construction of any qualifying asset are capitalised during the period of time that is required to complete and prepare the asset for its intended use or sale. Other borrowing costs are expensed.

Liabilities for short-term employee benefits including wages and salaries, non-monetary benefits and profit-sharing bonuses are measured at the amount expected to be paid when the liability is settled, if it is expected to be settled wholly before twelve months after the end of the reporting period, and is recognised in other payables. Liabilities for non-accumulating sick leave are recognised when the leave is taken and measured at the rates payable.

The liability for other long-term employee benefits such as annual leave and long service leave is recognised in current provisions for employee benefits if it is not expected to be settled wholly before twelve months after the end of the reporting period. It is measured at the present value of expected future payments to be made in respect of services provided by employees up to the reporting date using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are discounted using market yields at the reporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimate future cash outflows.

Regardless of the expected timing of settlements, provisions made in respect of employee benefits are classified as a current liability, unless there is an unconditional right to defer the settlement of the liability for at least twelve months after the reporting date, in which case it would be classified as a non-current liability.

The Group recognises a liability and an expense for bonuses and profit-sharing based on a formula that takes into consideration the entity's positive adjusted operating result. The Group recognises a provision where it is contractually obliged or where there is a past practice that has created a constructive obligation.




The University incurs Payroll Tax at the rate determined by the state and territory governments for payments made to and benefits received by employees.

The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows.

(s) Superannuation

(t) Rounding of amounts


The University contributes to several superannuation funds on a pay-as-you-go basis. Employee contributions are based on various percentages of their gross salaries. After serving a qualifying period, all employees are entitled to benefits on retirement, disability or death. Under these schemes the University's legal obligation is limited to the amount that it agrees to contribute to the fund and the actuarial and investment risks fall on the employee.

The funds provide defined benefits based on years of service, employee contributions and final average salary. The University is under no legal obligation to make up any shortfall in the funds assets to meet payments due to employees.

Amounts in the financial statements have been rounded off in accordance with Class Order 98/100 as amended by Class Order 04/667 issued by the Australian Securities and Investment Commission, relating to the rounding off of amounts in the financial statements. Amounts have been rounded off to the nearest thousand dollars.

(w) Taxation

(ii) For receivables and payables which are recognised inclusive of GST.

(u) Provisions

Provisions are not recognised for future operating losses.

(v) Web site costs

Provisions for legal claims and service warranties are recognised when there is a present legal or constructive obligation as a result of past event; it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably estimated.

Provisions are measured at the present value of management's best estimate of the expenditure required to settle the present obligation at the balance sheet date. The discount rate used to determine the present value reflects current market assessments of the time value of money, and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as a finance cost.

Costs in relation to web sites controlled by the University are charged as expenses in the period in which they are incurred unless they relate to the acquisition of an asset, in which case they are capitalised and amortised over their period of expected benefit.

The Charles Darwin University is a public authority within the meaning of Section 50-25 of the Income Tax Assessment Act 1997 and its income is exempt under the provisions of that Act.

Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except:(i) Where the amount of GST incurred is not recoverable from the Australian Tax Office, the GST is recognised as part of the cost of acquisition of an asset or as part of an item of expense; or




Adoption of new and revised accounting standardsIn the current year Charles Darwin University has adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that are relevant to its operations and effective for the current annual reporting period. The adoption of these new and revised Standards and Interpretations has not resulted in changes to the accounting policies of the Group.

At the date of authorisation of the financial report, a number of Standards and Interpretations were in issue but not yet effective. Initial application of the following Standards is unlikely to affect any of the amounts recognised in the financial report, but may change the disclosures presently made in within the financial report:

(y) Comparative amounts

(z) New accounting standards and interpretations


(x) Investment propertyInvestment properties exclude properties held to meet service delivery objectives of the Group.

Investment properties are initially recognised at cost. Costs incurred subsequent to initial acquisition are capitalised when it is probable that future economic benefits in excess of the originally assessed performance of the asset will flow to the Group. Where an investment property is acquired at no cost or for nominal consideration, its cost shall be deemed to be its fair value as at the date of acquisition.

Subsequent to initial recognition at cost, the investment property is carried at fair value, which is based on active market prices, adjusted, if necessary, for any difference in the nature, location or condition of the specific asset. If this information is not available, the Group uses alternative valuation methods such as recent prices in less active markets or discounted cash flow projections. These valuations are reviewed annually by a member of the Australian Property Institute. Changes in fair values are recorded in the income statement as part of the other income.

Rental revenue from the leasing of investment properties is recognised in the income statement in the periods in which it is receivable, as this represents the pattern of service rendered through the provision of the properties.

Where necessary, comparative information has been reclassified to enhance comparability in respect of changes in presentation adopted in the current year.




Effective for Annual Reporting

Effective to be Initially Applied in

Period Beginning On or After

the Financial Year Ending

AASB 9 'Financial Instruments' (December 2009) and AASB 2009-11 'Amendments to Australian Accounting Standards arising from AASB 9' AASB 2012-6 'Amendments to Australian Accounting Standards - Mandatory Effective Date of AASB 8 and Transition Disclosure' AASB 2013-9 'Amendments to Australian Accounting Standards - Conceptual Framework, Maternity and Financial Instruments'

1 January 2017 31 December 2017

AASB 9 'Financial Instruments' (December 2010), AASB 2010-7 'Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) AASB 2012-6 'Amendments to Australian Accounting Standards - Mandatory Effective Date of AASB 8 and Transition Disclosure' AASB 2013-9 'Amendments to Australian Accounting Standards - Conceptual Framework, Maternity and Financial Instruments'


AASB 10 'Consolidated Financial Statements'


AASB 11 'Joint Arrangements' 1 January 2014 31 December 2014

AASB 12 'Disclosure of Interests in Other Entities'


AASB 1031 'Materiality' (2013) 1 January 2014 31 December 2014

AASB 1055 'Budgetary Reporting' 1 July 2014 31 December 2015

AASB 2011-2 'Amendments to Australian Accounting Standards arising from the Trans-Tasman Convergence Project - Reduced Disclosure Requirements'

1 July 2013 31 December 2014


Standards/Interpretation








AASB 2011-4 ‘Amendments to Australian Accounting Standards to Remove Individual Key Management Personnel Disclosure Requirements’


AASB 2011-6 ‘Amendments to Australian Accounting Standards – Extending Relief from Consolidation, the Equity Method and Proportionate Consolidation – Reduced Disclosure Requirements’


AASB 2012-1 ‘Amendments to Australian Accounting Standards – Fair Value Measurement – Reduced Disclosure Requirements’


AASB 2012-3 ‘Amendments to Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities’


AAAB 2012-7 ‘Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements’


AASB 2012-11 ‘Amendments to Australian Accounting Standards – Reduced Disclosure Requirements and Other Amendments’ [AASB, AASB 2, AASB 8, AASB 10, AASB 107, AASB 128, AASB 133, AASB 134 & AASB 2011-4]


AASB 2013-3 ‘Amendments to AASB 136 – Recoverable Amount Disclosures for Non-Financial Assets’


AASB 2013-4 ‘Amendments to Australian Accounting Standards – Novation of Derivatives and Continuation of Hedge Accounting’











AASB 2013-5 ‘Amendments to


AASB 2013-9 ‘Amendments to Australian Accounting Standards – Conceptual Framework, Materiality and Financial Instruments’

Part B –Materiality

31 December 2014

1 January 2014

1 January 2014

Interpretation 21 ‘Levies’ 1 January 2014 31 December 2014

Part C – Financial Instruments






NOTE 2: DISAGGREGATED INFORMATION

(a) Industry - Dual Sector Providers (Parent)

NoteHigher

Education VETTotal

ParentHigher

Education VETTotal

Parent2013 2013 2013 2012 2012 2012$'000 $'000 $'000 $'000 $'000 $'000

INCOME STATEMENT

Income from continuing operationsAustralian Government financial assistance 3 82,492 16,602 99,094 98,419 7,932 106,351

Australian Government grants HECS - HELP Australian Government payments 3 21,549 - 21,549 17,776 - 17,776

FEE - HELP 3 357 - 357 548 - 548

SA - HELP 3 555 - 555 262 - 262

NT Government financial assistance 4 6,838 54,350 61,188 8,575 51,206 59,781

HECS - HELP student payments 5,401 - 5,401 5,628 - 5,628

Fees and charges 5 21,195 8,595 29,790 15,070 8,474 23,544

Investment revenue 6 2,463 1,510 3,973 3,046 2,031 5,077

Consultancy and contracts 7 15,792 - 15,792 17,271 - 17,271

Other revenue and income 8 23,048 14,456 37,504 11,404 7,794 19,198

Total Revenue from continuing operations 179,690 95,513 275,203 177,999 77,437 255,436

Gain/(loss) on disposal of assets 28 661 417 1,078 244 163 407

Total income from continuing operations 180,351 95,930 276,281 178,243 77,600 255,843

Expenses from continuing operationsEmployee related expenses 9 84,673 51,238 135,911 77,295 50,044 127,339

Depreciation and amortisation 10 11,545 6,986 18,531 9,779 6,331 16,110

Repairs and maintenance 11 4,688 2,836 7,524 3,900 2,524 6,424

Impairment of assets 12 393 237 630 217 141 358

Other expenses 13 64,290 38,904 103,194 48,638 31,491 80,129

Total expenses from continuing operations 165,589 100,201 265,790 139,829 90,531 230,360 Operating result before income tax

14,762 (4,271) 10,491 38,414 (12,931) 25,483

Income tax expense 1(w) - - - - - -

Operating result after income tax for the period 14,762 (4,271) 10,491 38,414 (12,931) 25,483

Operating result attributable to non-controlling interest - - - - - -

Operating result attributable to members of Charles Darwin University 14,762 (4,271) 10,491 38,414 (12,931) 25,483

Operating revenues and expenses for Higher Education and VET are shown in the following tables. The figures refer only to the parent entity; consolidated totals are not included. Discrete sets of accounts are not maintained for these divisions. They have been derived based on the results of costings determined via Activity Based Costing.

Parent Entity Parent Entity

The above Income Statement should be read in conjunction with the accompanying notes.




NOTE 2: DISAGGREGATED INFORMATION Continued

(a) Industry - Dual Sector Providers (Parent) (continued)

NoteHigher

Education VETTotal

ParentHigher

Education VETTotal

Parent2013 2013 2013 2012 2012 2012$'000 $'000 $'000 $'000 $'000 $'000

STATEMENT OF FINANCIAL POSITION

ASSETS

Current assetsCash and cash equivalents 14 62,384 35,394 97,778 58,338 31,001 89,339

Receivables 15 5,395 3,061 8,456 4,572 2,430 7,002

Inventories 16 636 361 997 654 348 1,002

Other financial assets 19 501 284 785 995 529 1,524

Non-current assets classified as held for sale 20 7,925 4,496 12,421 15,672 8,328 24,000

Other non-financial assets 21 3,824 2,170 5,994 3,340 1,774 5,114

Total current assets 80,665 45,766 126,431 83,571 44,410 127,981

Non-current assetsBiological assets 17 - 3,190 3,190 - 2,495 2,495

Property, plant and equipment 22 318,349 135,130 453,479 276,965 127,119 404,084

Intangible assets 23 - - - 78 - 78

Total non-current assets 318,349 138,320 456,669 277,043 129,614 406,657

Total assets 399,014 184,086 583,100 360,614 174,024 534,638

LIABILITIESCurrent liabilitiesTrade and other payables 24 7,340 4,165 11,505 5,665 3,011 8,676 Borrowings 25 1,276 724 2,000 - - - Provisions 26 12,687 7,198 19,885 12,287 6,530 18,817 Other liabilities 27 3,919 2,223 6,142 2,605 1,384 3,989 Total current liabilities 25,222 14,310 39,532 20,557 10,925 31,482

Non-current liabilitiesBorrowings 25 10,208 5,792 16,000 3,918 2,082 6,000 Provisions 26 1,155 656 1,811 1,132 602 1,734 Total non-current liabilities 11,363 6,448 17,811 5,050 2,684 7,734

Total liabilities 36,585 20,758 57,343 25,607 13,609 39,216

Net assets 362,429 163,328 525,757 335,007 160,415 495,422

EquityReserves 29(a) 155,320 70,109 225,429 139,215 66,662 205,877 Restricted funds 29(b) 27,461 12,395 39,856 32,713 15,665 48,378 Retained earnings 29(c) 179,648 80,824 260,472 163,079 78,088 241,167

Total equity 362,429 163,328 525,757 335,007 160,415 495,422

The above Statement of Financial Position should be read in conjunction with the accompanying notes.







Higher Education VET

Total Parent

$'000 $'000 $'000STATEMENT OF CHANGES IN EQUITY

ParentBalance at 1 January 2012 282,671 165,948 448,619Profit or loss 38,414 (12,931) 25,483Other comprehensive income 13,922 7,398 21,320Total comprehensive income 52,336 (5,533) 46,803

Balance at 31 December 2012 335,007 160,415 495,422

Balance at 1 January 2013 335,007 160,415 495,422Profit or loss 14,762 (4,271) 10,491Other comprehensive income 12,660 7,184 19,844Total comprehensive income for the period 27,422 2,913 30,335

Balance at 31 December 2013 362,429 163,328 525,757

The above Statement of Changes in Equity should be read in conjunction with the accompanying notes.






NoteHigher

Education VET Total ParentHigher

Education VETTotal

Parent2013 2013 2013 2012 2012 2012$'000 $'000 $'000 $'000 $'000 $'000

STATEMENT OF CASH FLOWS

Cash Flows from operating activities Australian Government grants 3(i) 104,953 16,602 121,555 116,984 7,952 124,936 OS-HELP (net) 3(i) 18 - 18 2 - 2 Superannuation supplementation 3(i) 22 - 22 19 - 19 State Government grants 7,522 59,785 67,307 9,432 56,327 65,759 HECS-HELP student payments 5,401 - 5,401 5,628 - 5,628 Receipts from student fees and other customers 59,501 31,618 91,119 41,785 25,610 67,395 Interest received 2,834 1,738 4,572 2,754 1,836 4,590 Proceeds from sale of biological assets - 387 387 - 375 375 Payments to suppliers and employees (incl. of GST) (160,968) (97,732) (258,700) (147,533) (80,204) (227,737)

Net cash provided by / (used in) operating activities 39 19,283 12,398 31,681 29,071 11,896 40,967

Cash flows from investing activities Proceeds from sale of property, plant and equipment 1,876 1,183 3,059 317 212 529 Payments for property, plant and equipment (24,860) (13,548) (38,408) (26,410) (14,030) (40,440) Payments for biological assets - (33) (33) - (19) (19) Loans to joint ventures 91 49 140 70 37 107

Net cash provided by / (used in) investing activities (22,893) (12,349) (35,242) (26,023) (13,800) (39,823)

Cash flows from financing activities Proceeds from borrowings 7,656 4,344 12,000 3,918 2,082 6,000

Net cash provided by / (used in) financing activities 7,656 4,344 12,000 3,918 2,082 6,000

Net Increase / (decrease) in cash and cash equivalents 4,046 4,393 8,439 6,966 178 7,144

Cash and cash equivalents at the beginning of the financial year 14 58,338 31,001 89,339 51,372 30,823 82,195

Cash and cash equivalents at the end of the financialyear 14 62,384 35,394 97,778 58,338 31,001 89,339


The above Statement of Cash Flows should be read in conjunction with the accompanying notes.




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

(a) Commonwealth Grant Scheme and Other Grants 41.1 Commonwealth Grants Scheme #1 52,613 48,760 52,613 48,760 Indigenous Support Program 3,833 3,635 3,833 3,635 Partnership and Participation Program #2 2,986 3,849 2,986 3,849 Disability Support Program 18 27 18 27 Structural Adjustment Fund Program 7,065 13,679 7,065 13,679 Promotion of Excellence in Learning and Teaching 254 - 254 - Transitional Cost Program - 13 - 13 Reward Funding 223 207 223 207 Facilitation Funding 762 708 762 708 Total C'wealth Grants Scheme and Other Grants 67,754 70,878 67,754 70,878 (b) Higher Education Loan Programs 41.2 HECS-HELP 21,549 17,776 21,549 17,776 FEE-HELP #4 357 548 357 548 SA-HELP 555 262 555 262 Total Higher Education Loan Programs 22,461 18,586 22,461 18,586 (c) Scholarships 41.3 Australian Postgraduate Awards 1,683 1,475 1,683 1,475 International Postgraduate Research Scholarship 133 128 133 128 Commonwealth Education Cost Scholarships#5 (850) 2,062 (850) 2,062 Commonwealth Accommodation Scholarships#5 (131) 176 (131) 176 Indigenous Access Scholarships (9) 269 (9) 269 Total Scholarships 826 4,110 826 4,110 (d) EDUCATION - Research 41.4 Joint Research Engagement Program#6 2,943 2,781 2,943 2,781 Joint Research Engagement Engineering Cadetship 25 10 25 10 Research Training Scheme 4,275 3,916 4,275 3,916 Research Infrastructure Block Grants 2,467 2,406 2,467 2,406 Sustainable Research Excellence in Universities 1,760 1,598 1,760 1,598

Total EDUCATION Research Grants 11,470 10,711 11,470 10,711 (e) Voluntary Student Unionism 41.5 VSU Transition Fund - - - - Support for Small Businesses - - - - Total VSU - - - - (f) Other Capital Funding Education Investment Fund 7,500 10,000 7,500 10,000 Total Other Capital Funding 7,500 10,000 7,500 10,000


NOTE 3: AUSTRALIAN GOVERNMENT FINANCIAL ASSISTANCE INCLUDING HECS-HELP AND OTHER AUSTRALIAN GOVERNMENT LOAN PROGRAMS




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

(g) Australian Research Council (i) Discovery 41.7(a) Projects 112 202 112 202 Indigenous Researchers Development 521 429 521 429 Total Discovery 633 631 633 631 (ii) Linkages 41.7(b) Infrastructure - 430 - 430 Projects 511 685 511 685 Total Linkages 511 1,115 511 1,115 Total ARC 1,144 1,746 1,144 1,746 (h) Other Australian Government Financial Assistance Non capital Department of Health and Aged Care Grants 3,674 2,700 - - AMEC 2,799 2,968 2,798 2,968 ITAS/ATAS 598 402 598 402 Away from Base - 2013 5,155 5,516 5,155 5,516 Away from Base - 2014 #7 1,849 - 1,849 - National Health and Medical Research Council Grants 12,518 12,315 - - Other 1,111 2,998 - 20 Capital Department of Health and Aged Care 25,650 - - - Total Other Australian Government financial assistance 53,354 26,899 10,400 8,906 Total Australian Government financial assistance 164,509 142,930 121,555 124,937

#2 Includes Equity Support Program.#3 Includes Collaboration and Structural Adjustment Program.#4 Program is in respect of FEE-HELP for Higher Education only and excludes funds received in respect of VET FEE-HELP.#5 Includes Grandfathered Scholarships, National Priority and National Accommodation Priority Scholarships respectively.#6 Includes Institutional Grants Scheme.#7 2014 Away From Base funding received in 2013.

NOTE 3: AUSTRALIAN GOVERNMENT FINANCIAL ASSISTANCE INCLUDING HECS-HELP AND OTHER AUSTRALIAN GOVERNMENT LOAN PROGRAMS Continued

#1 Includes the basic CGS grant amount, CGS - Regional Loading, CGS - Enabling Loading, Maths and Science Transitional Loading and Full Fee Places Transition Loading.





Note2013 2012 2013 2012$'000 $'000 $'000 $'000

ReconciliationAustralian Government Grants (a+c+d+e+f+g+h) 142,048 124,344 99,094 106,351 HECS-HELP payments 21,549 17,776 21,549 17,776 FEE-HELP payments 357 548 357 548 SA-HELP payments 555 262 555 262 Total Australian Government financial assistance 164,509 142,930 121,555 124,937 (i) Australian Government Grants received - cash basis CGS and Other EDUCATION Grants 67,754 70,878 67,754 70,878 Higher Education Loan Programs 22,461 18,586 22,461 18,586 Scholarships 826 4,110 826 4,110 EDUCATION Research 11,470 10,711 11,470 10,711 Other Capital Funding 7,500 10,000 7,500 10,000 ARC Grants - Discovery 633 631 633 631 ARC Grants - Linkages 511 1,115 511 1,115 Other Australian Government Grants 53,354 26,899 10,400 8,906 Total Australian Government Grants received - cash basis 164,509 142,930 121,555 124,937 OS-HELP (Net) 41.8 18 2 18 2 Superannuation Supplementation 41.9 22 19 22 19 Total Australian Government funding received - cash basis 164,549 142,950 121,595 124,957 NOTE 4: NORTHERN TERRITORY GOVERNMENT FINANCIAL ASSISTANCEOperating Vocational Educational and Training 50,304 49,009 50,304 49,009 NTG - other financial assistance 11,840 14,473 6,860 8,517

62,144 63,482 57,164 57,526 Capital Vocational Education and Training 4,024 1,300 4,024 1,300 NTG - specific purpose infrastructure funding - 955 - 955

4,024 2,255 4,024 2,255 Total Northern Territory Government Financial Assistance 66,168 65,737 61,188 59,781 NOTE 5: FEES AND CHARGESCourse fees and charges Fee-paying overseas students 16,482 12,457 16,398 12,457 Continuing education 4,480 4,807 4,480 4,807 Fee-paying domestic postgraduate students 1,065 779 1,108 832 Fee-paying domestic undergraduate students 76 153 76 153 Fee-paying domestic non-award students 592 595 592 595

Total course fees and charges 22,695 18,791 22,654 18,844 Other non-course fees and charges Application fees 71 46 71 46 Administration fees and charges 638 286 638 286 Other 3,810 2,776 6,427 4,368 Total other fees and charges 4,519 3,108 7,136 4,700 Total fees and charges 27,214 21,899 29,790 23,544


NOTE 3: AUSTRALIAN GOVERNMENT FINANCIAL ASSISTANCE INCLUDING HECS-HELP AND OTHER AUSTRALIAN GOVERNMENT LOAN PROGRAMS Continued




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 6: INVESTMENT REVENUE AND INCOMEInterest 5,935 7,259 3,973 5,077 Dividends 57 26 - - Investment property rental 10 11 - - Total investment revenue 6,002 7,296 3,973 5,077 NOTE 7: CONSULTANCY AND CONTRACTSContract research 20,557 21,701 13,922 14,885 Miscellaneous consultancy non-research related 1,870 2,386 1,870 2,386 Total consultancy and contracts 22,427 24,087 15,792 17,271 NOTE 8: OTHER REVENUE AND INCOMEOther revenueDonations - CDUFT and other 582 4,081 44 54 Scholarships and prizes 2,282 2,108 1,266 1,552 Financial assistance/grants 2,231 3,712 2,111 3,612 Sales 4,019 4,659 4,695 4,741 Facility and equipment hire 639 530 612 521 Catering 227 222 220 217 Guest accommodation 3,200 3,308 3,200 3,308 Joint venture operations 21,955 2,258 21,955 2,258 Sundry income 1,609 1,467 1,509 1,438 Other 1,028 1,007 843 882 Total other revenue 37,772 23,352 36,455 18,583 Other incomeChange in fair value less point of sale cost of livestock 1,049 615 1,049 615 Total other income 1,049 615 1,049 615 Total other revenue and income 38,821 23,967 37,504 19,198





Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 9: EMPLOYEE-RELATED EXPENSESEmployee benefits and on-costsAcademic Salaries 65,193 63,598 51,572 48,465 Contributions to superannuation and pension schemes: - Funded 10,425 9,803 8,753 7,879 Payroll tax 4,537 4,320 3,709 3,401 Worker's compensation 566 494 447 370 Long service leave expense 1,620 1,844 1,313 1,544 Annual leave 8,262 8,275 6,343 6,232 Total academic 90,603 88,334 72,137 67,891 Non-academic Salaries 49,476 45,383 45,203 42,180 Contributions to superannuation and pension schemes: - Funded 8,236 7,627 7,639 7,153 Payroll tax 3,290 2,994 3,194 2,929 Worker's compensation 415 342 380 313 Long service leave expense 1,287 1,265 1,300 1,185 Annual leave 6,790 6,116 5,977 5,598 Other 81 90 81 90 Total non-academic 69,575 63,817 63,774 59,448 Total employee related expenses 160,178 152,151 135,911 127,339 NOTE 10: DEPRECIATION AND AMORTISATIONDepreciation Buildings and demountables 12,059 11,186 12,059 11,186 Plant and equipment 4,789 3,016 4,498 2,666 Leasehold improvements 196 - 196 - Land improvements 842 700 842 698 Books and periodicals 858 1,092 858 1,092 Total depreciation 18,744 15,994 18,453 15,642 Amortisation Intangible asset - software licence 78 468 78 468 Total amortisation 78 468 78 468 Total depreciation and amortisation 18,822 16,462 18,531 16,110 NOTE 11: REPAIRS AND MAINTENANCEBuilding maintenance 781 589 779 589 Grounds maintenance 408 517 408 517 Electrical works 640 1,210 640 1,210 Air-conditioning 693 615 693 615 Building energy maintenance 611 371 611 371 Repairs and maintenance information technology 1,534 1,055 1,534 1,055 Plumbing 404 352 404 352 Repairs and maintenance general 3,219 2,456 2,455 1,715 Total repairs and maintenance 8,290 7,165 7,524 6,424





Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 12: IMPAIRMENT OF ASSETSGeneral debts 94 126 94 124 Student debts 536 481 536 481 Other financial assets - (247) - (247)Total impairment of assets 630 360 630 358

NOTE 13: OTHER EXPENSESScholarships, grants and prizes 13,364 13,513 17,338 17,407 Non-capitalised equipment 3,777 3,777 3,593 3,552 Advertising, marketing and promotional expenses 4,911 4,744 4,900 4,741 Materials 17,532 14,327 11,664 9,587 Stationery, photocopying and postage 1,449 1,671 1,044 1,209 Licences, fees and charges 6,130 4,933 5,798 4,586 Travel, staffing and related costs 9,606 11,316 6,529 7,256 Utilities and facilities management 8,816 7,502 8,448 7,161 Equipment rent and lease expenses 2,159 2,035 2,155 2,033 Motor vehicle expenses 1,143 1,224 1,138 1,224 Insurance 1,602 1,879 1,378 1,682 Inventory used 2,138 2,534 2,135 2,534 Consultants - teaching 1,676 1,706 1,676 1,706 Consultants - general 14,743 13,716 13,021 12,186 Communications 1,592 1,765 1,349 1,493 Joint venture operations 19,524 - 19,524 - Other 1,556 1,776 1,504 1,772 Total other expenses 111,718 88,418 103,194 80,129

NOTE 14: CASH AND CASH EQUIVALENTSCash at bank and on hand 20,879 14,979 18,512 10,610 Cash at bank - at call account 3,654 3,229 3,654 3,229 Cash at bank - term deposits 106,425 112,581 75,612 75,500 Total cash and cash equivalents 130,958 130,789 97,778 89,339

(a) Reconciliation to cash at the end of the year

Balances as above 130,958 130,789 97,778 89,339

Balance per Statement of Cash Flows 130,958 130,789 97,778 89,339

(b) Cash at bank and on hand

(c) At call

(d) Term deposits

(e) Bank quarantees


The above figures are reconciled to cash at the end of the year as shown in the statement of cash flows as follows:

The cash at bank and on hand include cash held in operating and replenishing bank accounts which are subject to variableinterest rates between 2.21% and 2.79% (2012 - 2.76% and 4.22%).

The cash at bank at call account is subject to variable interest rates between 2.38% and 3.85% (2012 - 2.8% and 5.1%).

The deposits are bearing floating interest rates between 3.3% and 4.5% (2012 - 3.94% and 6.01%). These deposits have anaverage maturity of 156 days (2012 - 173 days).

The University has two bank guarantees totalling $0.431 million for the lease of levels 10 and 11, 815 Geroge Street Sydney.




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 15: RECEIVABLESCurrentDebtors 12,108 10,351 9,805 8,251 Less: Provision for impaired receivables (1,349) (1,249) (1,349) (1,249)Total receivables 10,759 9,102 8,456 7,002

Impaired receivables

2013 2012The ageing of these receivables is: $000 $0003 to 6 months 283 28 Over 6 months 1,066 1,221

1,349 1,249

2013 2012The ageing of these receivables is: $000 $0003 to 6 months 180 1,665 Over 6 months 514 240

694 1,905

2013 2012$000 $000

At 1 January 1,249 1,512 Provisions for impairment during the year 629 607 Receivables written off during the year as uncollectible (529) (870)

1,349 1,249

Consolidated

Consolidated

Movements in the provision for impaired receivables are as follows:

The creation and release of the provision for impaired receivables has been included in 'other expenses' in the Income Statement. Amounts charged to the provision account are generally written off when there is no expectation of recovering additional cash.

The other amounts within receivables do not contain impaired assets and are not past due. Based on credit history, it is expected that these amounts will be received when due.

As of 31 December 2013, trade receivables of $0.694M (2012: $1.905 million) were past due but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these receivables is as follows:


As at 31 December 2013, current receivables of the consolidated entity with a nominal value of $1.349 million (2012: $1.249million) were impaired. The provision was 2013 $1.349 million (2012: $1.249 million). The individually impaired receivablesmainly relate to students, whom are in unexpectedly difficult economic situations. It was assessed that a portion of thereceivables is expected to be recovered.

Consolidated




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 16: INVENTORIESCurrentCDU Bookshop 594 456 594 456 Uniprint 54 86 54 86 CDU Press - 37 - 37 Northern Editions 528 459 528 459 Less: Provision for impairment (179) (36) (179) (36)

Total inventories 997 1,002 997 1,002

NOTE 17: BIOLOGICAL ASSETSCattleCarrying amount at 1 January 2,413 2,159 2,413 2,159

Gain/(loss) from changes to fair value less estimated point of sale costs 1,059 610 1,059 610 Purchases 33 19 33 19 Sales (385) (375) (385) (375)Births - - - - Deaths - - - - Carrying amount at 31 December 3,120 2,413 3,120 2,413

HorsesCarrying amount at 1 January 82 77 82 77

Gain/(loss) from changes to fair value less estimated point of sale costs (10) 5 (10) 5 Purchases - - - - Sales (2) - (2) - Births - - - - Deaths - - - - Carrying amount at 31 December 70 82 70 82

3,190 2,495 3,190 2,495

As at 31 December 2013, livestock held for sale comprised 5,027 cattle and 36 horses (2012: 4,403 cattle and 43 horses).


There is no restriction on the title of the cattle and horses and the carrying amounts of the livestock have not been pledged as security for liabilities.

As at 31 December 2013, the University had no commitment to purchase any livestock.




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 18: INVESTMENT PROPERTY

At fair valueOpening balance at 1 January 2013 260 250 - - Revaluation of assets 40 10 - -

Closing balance at 31 December 2013 300 260 - -

Amounts recognised in profit and loss for investment properties Rental income 13 12 - - Direct operating expenses (rent generating properties) (7) (4) - - Total recognised in profit and loss 6 8 - -

NOTE 19: OTHER FINANCIAL ASSETSCurrentAccrued revenue 953 2,634 - - Accrued interest receivable 785 1,412 785 1,384 Loan to FCD Health Limited - 140 - 140 Other 221 409 - - Total current 1,959 4,595 785 1,524

Non currentListed securitiesOpening value 224 185 - - - Investment revaluation reserve 55 39 - - Total non-current 279 224 - -

Total other financial assets 2,238 4,819 785 1,524

NOTE 20: NON-CURRENT ASSETS CLASSIFIED AS HELD FOR SALE Land held for resale 12,421 24,000 12,421 24,000

Total non-current assets classified held for sale 12,421 24,000 12,421 24,000

NOTE 21: OTHER NON-FINANCIAL ASSETSPrepayments 6,237 5,296 5,994 5,114 Other assets 70 80 - -

Total other non-financial assets 6,307 5,376 5,994 5,114

Charles Darwin University entered into an agreement with CIC-TDH Pty Ltd to develop part Lot 9765 Town of Palmerston (known as The Heights Durack). The development will deliver approximately 806 lots for residential purposes. The Agreement was dated 15 November 2010 and was effective from that date.

At 31 December 2013, stages 1 to 10 were available for sales and are expected to be sold during the year ending 31 December 2014. This land has continued to be classified as held for sale.

At 31 December 2013, stages 11 to 18 were still under development and sale is not anticipated to occur during the year ending 31 December 2014. The land related to stages 11 to 18 has been reclassified property, plant and equipment in the Statement of Financial Position and recorded at fair value in accordance with the University's accounting policy.


The fair value of the investment property which is held by Charles Darwin University Trust Foundation was provided by an independent qualified valuer with experience in the location and category of the investment property.


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Note2013 2012 2013 2012

$'000 $'000 $'000 $'000

NOTE 23: INTANGIBLE ASSETSCost 2,339 2,339 2,339 2,339 Accumulated amortisation and impairment losses (2,261) (1,793) (2,261) (1,793)Opening net book amount 78 546 78 546 Amortisation charge (78) (468) (78) (468)Closing net book amount - 78 - 78

NOTE 24: TRADE AND OTHER PAYABLES

Trade creditors 9,158 11,103 11,505 8,676 Total trade and other payables 9,158 11,103 11,505 8,676

(a) Fair valueDue to the short-term nature of these payables, their carrying value is assumed to approximate their fair value.

NOTE 25: BORROWINGSUnsecured NTG Waterfront campus fit-out loan 2,000 - 2,000 - Total current borrowings 2,000 - 2,000 -

Unsecured NTG Waterfront campus fit-out loan 16,000 6,000 16,000 6,000 Total non-current borrowings 16,000 6,000 16,000 6,000 Total borrowings 18,000 6,000 18,000 6,000


The University has an interest free loan with the Northern Territory Government of $6 million for the Charles Darwin University Education and Training Facility at the Darwin Waterfront Precinct. The term of the loan is five years, repayments are to commence in 2014/15 and be completed by 2016/17.

In February 2013, the University entered into an agreement for a loan facility of $28.0 million over 2 years with Northern Territory Treasury Corporation (NTTC) to assist CDU to finance the construction of the Charles Darwin University Education and Training Facility. The University made two drawdowns totalling $12.0 million during 2013. The first drawdown was for a two year term with quarterly interest repayments and fixed interest rate of 5.48% and the second drawdown was for one year and nine months with quarterly interest repayments and a fixed interest rate of 5.20%. Both drawdowns were paid back in February 2014. The loan facility is still available to the University.




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 26: PROVISIONSCurrent provisions expected to be settled within 12 monthsEmployee benefits Annual leave 12,106 12,031 10,021 9,999 Long service leave 10,944 9,407 9,864 8,818 Total current provisions 23,050 21,438 19,885 18,817

Non-current provisionsEmployee benefits Long service leave 2,101 2,279 1,811 1,734 Total non-current provisions 2,101 2,279 1,811 1,734

Total provisions 25,151 23,717 21,696 20,551

NOTE 27: OTHER LIABILITIESCurrent Revenue received in advance 6,334 3,736 5,935 3,702 OS-HELP liability to Australian Government* 18 2 18 2 Other 188 285 189 285 Total other liabilities 6,540 4,023 6,142 3,989

NOTE 28: GAIN/(LOSS) ON DISPOSAL OF ASSETSProceeds on sale of property, plant and equipment 3,082 530 3,059 529 Less: Carrying amount of property, plant andequipment sold (1,993) (122) (1,981) (122)Total gain/(loss) on disposal of assets 1,089 408 1,078 407

There were 1,392 equivalent full time and fixed period contract employees at the end of 2013 and there were 1,373 equivalent full time and fixed period contract employees at the end of 2012.

* The 2013 DET Guidelines require OS-HELP to be recorded as a liability as it considers that the University acts as an agent on behalf of the Australian Government in distributing the loans to students.





Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 29: RESERVES, RESTRICTED FUNDS AND ACCUMULATED FUNDS(a) ReservesProperty, plant and equipment revaluation reserve 225,671 206,064 225,429 205,877 Capital asset reserve 4,410 4,118 - - Restricted reserve - building 5,500 6,792 - - Total reserves 235,581 216,974 225,429 205,877

MovementsProperty, plant and equipment revaluation reserveBalance at 1 January 206,064 184,748 205,877 184,600 Revaluation surplus/(deficit) on: Land 1,842 21,320 1,842 21,320 Land improvements 171 - 171 - Leasehold improvements - - - - Buildings 17,511 - 17,511 - Demountables 55 - 55 - Library collection 312 - 312 - Work of art (47) - (47) - Plant and equipment - - - - Investments 55 39 - - Assets retired transferred to accumulated funds: Buildings, plant and equipment (292) (43) (292) (43)Balance at 31 December 225,671 206,064 225,429 205,877

Capital asset reserveBalance at 1 January 4,118 - - - Transfers from/(to) accumulated funds 292 4,118 - - Balance at 31 December 4,410 4,118 - -

Restricted reserve - buildingBalance at 1 January 6,792 11,470 - - Transfers from/(to) accumulated funds (1,292) (4,678) - - Balance at 31 December 5,500 6,792 - -

(b) Restricted funds reserveBalance at 1 January 48,378 31,639 48,378 31,639 Transfers from/(to) accumulated funds orAdjustments via revenue and (expenditure) (8,522) 16,739 (8,522) 16,739 Balance at 31 December 39,856 48,378 39,856 48,378





Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 29: RESERVES, RESTRICTED FUNDS AND ACCUMULATED FUNDS Continued

(c) Accumulated fundsAccumulated funds at 1 January 279,566 268,313 241,167 232,380 Operating result for the period 31,991 27,389 10,491 25,483 Accumulated funds before transfers toRestricted funds 311,557 295,702 251,658 257,863 Transfers (to) / from restricted funds 8,522 (16,179) 8,522 (16,739)

Transfer of property, plant and equipment revaluation reserve for retired assets 1,292 43 292 43

Total accumulated funds at 31 December 321,371 279,566 260,472 241,167

(d) Nature and purpose of reservesProperty, plant and equipment revaluation reserve

Restricted funds

The property, plant and equipment revaluation reserve arises on the revaluation of non-current assets. Where a revalued asset is sold that portion of the asset revaluation reserve which relates to that asset, and is effectively realised, is transferred to accumulated funds.

Restricted funds arise where funds are received in advance and are subject to contractual obligations, including activity and financial acquittal.





NOTE 30: KEY MANAGEMENT PERSONNEL DISCLOSURES

(a) Names of responsible persons and executive officers

Council membersHer Honour, the Hon Sally Thomas AM ChancellorProfessor Barney Glover * Vice-ChancellorProfessor Sandra Dunn Chair, Academic Board until 16 April 2013Associate Professor Steve Shanahan Chair, Academic Board from 16 April 2013Professor Mary O'Kane Member appointed by the AdministratorMr Elliott McAdam Member appointed by the AdministratorMrs Jennifer Prince PSM Member appointed by the AdministratorMr Neil Ross Member appointed by the AdministratorMr Alan Morris Member appointed by the Administrator Mr Matthew Gardiner Member appointed by the Administrator Mr Richard Ryan AO Member appointed by the Administrator Mr Ken Davies Member appointed by the Administrator Professor Rose McEldowney Member elected by the Academic Staff (Higher Education)Mr Justin Busse Member elected by the Academic Staff (VET)Mr Kingsley Brenton Member elected by the Undergraduate Students

(b) Executive officersProfessor Sharon BellMr Rob Brelsford-Smith

Professor Giselle ByrnesProfessor Martin CarrollProfessor Sue Carthew

Ms Debra Farrelly

Ms Debra FarrellyMr John HassedMr Mark HewitsonProfessor Steven LarkinDr Scott Snyder

Dr Scott Snyder

All of the above persons were also key management persons during the year ended 31 December 2013.

Pro Vice-Chancellor, Indigenous LeadershipPro-Vice Chancellor, Strategy and Planning until the restructure on 8 September 2013Chief Operating Officer from 9 September 2013

* Council members may include the Group's employees who may be ex-officio members or elected staff members. No Council member (including Chancellor or Vice Chancellor) has received any remuneration in his/her capacity as a Council member. Council members may also be executive officers of the parent entity. Where this is the case they have been included in executive officer remuneration band following.

Chief Financial Officer from 5 July 2013

The following persons were responsible persons and executive officers of the Group during the financial year:

Deputy Vice-ChancellorExecutive Director, Finance and Asset Services until his resignation on 5 July 2013Pro Vice-Chancellor, Faculty of Law, Education, Business and ArtsPro Vice-Chancellor, AcademicPro Vice-Chancellor, Faculty of Engineering, Health, Science and the EnvironmentExecutive Director, Corporate Services until the restructure on 8 September 2013Deputy Chief Operating Officer from 9 September 2013Pro Vice-Chancellor, Faculty of Vocational Education and Training




NOTE 30: KEY MANAGEMENT PERSONNEL DISCLOSURES Continued

(c) Remuneration of Council members and executives

2013 2012

Remuneration of Council membersNil to $14,999 14 14

2013 2012

Remuneration of executives$180,000 to $194,999 1$195,000 to $209,999$210,000 to $224,999$225,000 to $239,999 1 1$240,000 to $254,999 1 1$255,000 to $269,999 1 1$270,000 to $284,999 1 2$285,000 to $299,999 3 2$300,000 to $314,999 1$330,000 to $344,999 1$345,000 to $359,999$360,000 to $374,999 1$375,000 to $389,000 1$390,000 to $404,999$470,000 to $484,999$560,000 to $574,999$600,000 to $614,999 1$645,000 to $659,999 1

(d) Key management personnel compensation

2013 2012 2013 2012$'000 $'000 $'000 $'000

Short-term employee benefits 4,558 4,459 3,006 2,798Termination Benefits 29 - 29 -Post-employee benefits* 597 574 402 375

5,184 5,033 3,437 3,173

(e) Loans to key management personnel

No write-downs or allowances for doubtful receivables have been recognised in relation to any loans made to key management personnel.

Number

Parent Entity

Number


* Superannuation is included in post-employee benefits.

There were no loans provided to Council members or other key management personnel of the Group, including their personally related parties, during the year.

Remuneration paid or payable or otherwise made available to Council members and executives of the Group:

Parent Entity




Note2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 31: REMUNERATION OF AUDITORS

Audit servicesFees paid to the Northern Territory Auditor-General's Office 177 190 146 160Total remuneration for audit services 177 190 146 160

NOTE 32: CONTINGENCIESContingent liabilitiesThere were no contingent liabilities as at 31 December 2013.

NOTE 33: COMMITMENTS

Capital expenditure contracted for at the reporting date but not recognised as liabilities is as follows:

2013 2012 2013 2012$'000 $'000 $'000 $'000

Building worksPayable:Within one year 34,506 39,868 20,490 5,052Later than one year but not later than five years - - -Later than five years - - -

34,506 39,868 20,490 5,052

(b) Lease commitmentsAll leases of the Group are operating leases.

Operating leasesMotor vehicles 22 32 22 32Office equipment 479 452 479 452Computing equipment 2,033 1,573 2,033 1,573Property 4,799 438 4,799 438Cancellable property 536 297 - -Total leases 7,869 2,792 7,333 2,495

Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:Within one year 2,214 1,059 2,214 1,059Later than one year but not later than five years 5,119 1,436 5,119 1,436Later than 5 years - - - -Total non-cancellable leases 7,333 2,495 7,333 2,495

Commitments for minimum lease payments in relation to cancellable operating leases are payable as follows:Within one year 236 297 - -Later than one year but not later than five years 300 - - -Later than 5 years - - - -Total cancellable leases 536 297 - -

The weighted average interest rate implicit in the non-cancellable operating leases is 8.21% (2012: 8.94%).


(a) Capital commitments


--




2013 2012 2013 2012$'000 $'000 $'000 $'000

NOTE 33: COMMITMENTS Continued

(c) Other expenditure commitmentsOtherWithin one year 3,146 804 3,146 804Later than one year but not later than five years - - - -

Later than five years - - - -3,146 804 3,146 804

Joint venturesWithin one year 255 400 200 200Later than one year but not later than five years 740 900 700 800Later than five years - 300 - 300

995 1,600 900 1,300

NOTE 34: RELATED PARTIES(a) Parent entityThe parent entity is Charles Darwin University.

(b) SubsidiariesSubsidiaries are set out in Note 35.

(c) Key management personnelDisclosures relating to directors and specified executives are set out in Note 30.

(d) Transactions with related partiesThe following transactions took place with related parties:

Menzies School of Health Research (MSHR)2013 2012$'000 $'000

Income Other 736 97 Student fees 4 53

Expenditure Student fees * 1,510 1,083 Projects 717 1,085 JRE, SRE and RIBG 2,514 2,454 Other 108 53Total transactions with related parties (4,109) (4,525)

* Student fee income was earned by MSHR from students enrolled with CDU but undertaking course work with the EducationSection of MSHR. The terms and conditions governing the payment of these fees are covered in Attachments One and Two of the Memorandum of Understanding signed between MSHR and CDU in March 2004.


(d) RevenueIncluded in the 2013 consolidation revenue amount of $331.6 million is capital funding received of $37.2 million and structural adjustment funding of $7.0 million which are committed to specific projects in 2013 and future years.




NOTE 34: RELATED PARTIES Continued

Charles Darwin University Foundation Trust (CDUF)2013 2012$'000 $'000

Income Donor disbursements for CDU Activities 3,721 2,396

Expenditure Interest expense 180 -Total transactions with related parties 3,541 2,396

Charles Darwin Amenities Ltd (CDUA)2013 2012$'000 $'000

Income CDU provides rental and administrative support at no charge

Expenditure Grant funding 119 100Total transactions with related parties (119) (100)

Centre for Remote Health2013 2012$'000 $'000

IncomeConsultancy fees 161 182

Expenditure Grant funding 112 95Total transactions with related parties 49 87

FCD Health Limited

(e) Loans to/from related parties

(f) Outstanding balances

(g) Additional information - Menzies School of Health Research (MSHR)

Menzies intends to transfer ownership of the buildings to CDU and NTG respectively upon completion of the works and for Menzies to occupy the buildings for nominal rent thereafter. CDU have offered MSHR a 40 year lease option at peppercorn rent. The University will occupy a portion of the building. The Northern Territory Department of Health are required to provide MSHR with a 20 year lease at peppercorn rent of $1.00 per annum under the Funding Agreement.

During the year ended 31 December 2013, CDU had no transactions with FCD Health Limited.

During the year ended 31 December 2013, FCD Health Limited paid out it's loan to CDU.

Menzies School of Health Research has been granted funds from the Commonwealth and Northern Territory Governments (NTG) for the purpose of constructing research and training facilities at Charles Darwin University (CDU) and Royal Darwin Hospital (RDH) and for refurbishing an existing building at RDH.

The new buildings will accommodate 420 MHSR staff and will allow the School to continue medical research and training, including laboratory and clinical research.

As at 31 December 2013, FCD Health Limited had nil outstanding loans to CDU (2012: $279,520). As at 31 December 2013 CDU is holding funds of $58,514 on behalf of CDU Amenities Limited (2012: $82,381). As at 31 December 2013 the University was holding $4,300,000 (2012: nil) of liquid investments on behalf of the CDUF as well as $42,139 (2012: nil) of interest payable and $3,561 (2012: $300) of intercompany payable to CDUF.




NOTE 35: SUBSIDIARIES

Name of entity 2013 2012% %

Charles Darwin University Foundation 100 100Menzies School of Health Research 100 100CDU Amenities Limited 100 100

Country of Incorporation

AustraliaAustraliaAustralia

At 31 December 2013, the construction of both buildings was nearing completion. When the building on CDU land will be transferred to CDU, the building will be derecognised by MSHR and the carrying amount of the asset will be recognised in the statement of changes in equity as a distribution to CDU as the controlling entity. The building on NTG land will be handed over to the Northern Territory Department of Health at no cost.

The balance of unspent project costs of $5,499,989 at 31 December 2013 (2012: 6,792,181) forms part of restricted reserves at year end. These funds are restricted for the use of constructing the new buildings as detailed above.

Costs incurred up to 31 December 2013 of $34.4 million have been recorded as Work in Progress within the Statement of Financial Position.

MSHR have accepted unconditional undertakings in the form of bank guarantees (to pay on demand) in favour of Lahey Construction Pty Ltd to a total of $944,977.

The consolidated financial statements incorporate the assets, liabilities and results of the following subsidiaries in accordance with the accounting policy described in Note 1(b)(i):

Equity Holding

NOTE 34: RELATED PARTIES Continued




NOTE 36: JOINTLY CONTROLLED OPERATIONS AND ASSETS(a) Joint venture partnership

2013 2012 2013 2012$'000 $'000 $'000 $'000

Current assets 1,005 883 1,005 883Non-current assets 2,689 2,949 2,689 2,949Total assets 3,694 3,832 3,694 3,832

Current liabilities 112 113 112 113Non-current liabilities 139 156 139 156Total liabilities 251 269 251 269

Net assets 3,443 3,563 3,443 3,563

Revenues 2,424 2,263 2,424 2,263Expenses 2,445 2,423 2,445 2,423Net operating result before income tax (21) (160) (21) (160)

Share of partnership's commitments

(b) Joint venture entity

2013 2012 2013 2012$'000 $'000 $'000 $'000

Share of partnership's assets and liabilitiesCurrent assets 266 264 266 264Non-current assets 171 156 171 156Total assets 437 420 437 420

Current liabilities 121 361 121 361Non-current liabilities - - - -Total liabilities 121 361 121 361Net assets 316 59 316 59

Share of partnership's revenues, expenses and resultsRevenues 2,189 1,335 2,189 1,335Expenses 1,932 1,063 1,932 1,063Net operating result before income tax 257 272 257 272

The Parent Entity has a 50% interest in the Centre for Remote Health, which resides in Australia. The principal activity is the provision of health education and research to remote areas.

The assets employed in the above jointly controlled operations and assets are detailed below. The amounts are included in the financial statements under their respective categories.


The consolidated entity's share of capital commitments and other expenditure commitments relating to joint venture operations are disclosed in Note 33.

The Parent Entity has a 50% interest in FCD Health Limited, a company limited by guarantee, incorporated and operating in Australia. The principal activity is the provision of medical services.

The parent entity's interest in assets employed in FCD Health Limited is detailed below. These amounts are included in the financial statements under their respective categories.





NOTE 36: JOINTLY CONTROLLED OPERATIONS AND ASSETS Continued

Share of partnership's commitments

(c) Contingent liabilities relating to joint venturesThere are no contingent liabilities relating to joint ventures.

(d) Jointly controlled operations

2013 2012 2013 2012$'000 $'000 $'000 $'000

Share of joint venture operations assets and liabilitiesCurrent assets 12,421 24,000 12,421 24,000Non-current assets 10,700 - 10,700 -Total assets 23,121 24,000 23,121 24,000

Current liabilities - - - -Non-current liabilities - - - -Total liabilities - - - -Net assets 23,121 24,000 23,121 24,000

Share of joint ventures operations revenues, expenses and Revenues 19,524 - 19,524 -Expenses 19,524 - 19,524 -Net operating result before income tax - - - -

Capital expenditure commitmentsAt 31 December - - - -Total - - - -

Contingent liabilities incurred by the Universtiy arising from its interest in the jointly controlled operationAt 31 December - - - -Total - - - -

Assets pledged as security


Charles Darwin University has entered into a mortgage in favour of the Commonwealth Bank of Australia (CBA) the effect ofwhich is to secure repayment of the monies owing by CIC-TDH Pty Ltd to CBA. The land has been pledged as security forCIC-TDH Pty Ltd bank loans as required under the development agreement. The total borrowings of CIC-TDH Pty Ltd at 31December 2013 was $1,827,513 (2012: nil).

The proceeds of the sale of land are accounted for on a net gain basis. Should the University become entitled to any distribution as a result of the project, this should be recognised by the University when the right to receive payment has been established (provided that it is probable that economic benefits will flow to the University and the amount of income can be measured reliably).

The consolidated entity's share of capital commitments and other expenditure commitments relating to joint venture operations are disclosed in Note 33.

Charles Darwin University entered into an agreement with CIC-TDH Pty Ltd to develop part of Lot 9765 Town of Palmerston (known as The Heights, Durack). The development will deliver approximately 806 lots for residential purposes. The Agreement was dated 15 November 2010 and effective from that date. Under the Agreement, the University remains the registered proprietor of the land and the University allows CIC-TDH Pty Ltd to carry out the "Project" on the land in accordance with the terms and conditions set out in the Agreement. The Project means all activities implementing or related to the rezoning, subdivision and development of the land including where appropriate built form on the land in accordance with the amendments to the Planning Scheme, and including, without limitation, the management, subdivision, development and marketing of the land and the sale of allotments and if appropriate the built form on the allotments.




NOTE 36: JOINTLY CONTROLLED OPERATIONS AND ASSETS Continued

(e) Other

NOTE 37: ECONOMIC DEPENDENCY

NOTE 38: EVENTS OCCURRING AFTER THE BALANCE SHEET DATE

NOTE 39: RECONCILIATION OF OPERATING RESULTAFTER INCOME TAX TO NET CASH FLOWS FROMOPERATING ACTIVITIES

2013 2012 2013 2012$'000 $'000 $'000 $'000

Operating result for the period 31,991 27,389 10,491 25,483 Depreciation and amortisation 18,822 16,462 18,531 16,110 Net gain/(loss) on disposal of non-current assets (1,089) (408) (1,078) (407)Purchase of biological assets 33 19 33 19 Provision for impairment - loan to joint venture - (247) - (247)Fair value gains on other assets at fair value through profit or loss (40) (10) - -

49,717 43,205 27,977 40,958

Change in operating assets and liabilities(Increase)/decrease in receivables (1,657) 69 (1,454) (286)(Increase)/decrease in Inventories 5 (37) 5 (37)(Increase)/decrease in biological assets (695) (259) (695) (259)(Increase)/decrease in other financial assets 2,496 (807) 599 (487)(Increase)/decrease in other non-financial assets (931) (1,095) (880) (1,110)Increase/(decrease) in trade and other payables (1,901) (568) 2,830 (1,669)Increase/(decrease) in other liabilities 2,472 1,472 2,154 1,482 Increase/(decrease) in provisions 1,436 2,372 1,145 2,375

1,225 1,147 3,704 9 Net cash provided by/(used in) operating activities 50,942 44,352 31,681 40,967

The Consolidated entity however is impacted by Menzies School of Health Research's Building Project (see note 34 (g)). CDU is not aware of any other events affecting the Consolidated entity.


The Group is funded predominantly by annual appropriations from both the Commonwealth and Northern Territory Governments to meet proposed cash expenditure on both operational and capital items in the current financial year. These financial statements have been prepared on a going concern basis in the expectation that such funding will continue.

The University previously entered into an agreement to construct an education and training facility at Darwin Waterfront Precinct. In February 2013, the University entered into an agreement for a loan facility of $28.0 million over 2 years with an expiry date in May 2015 with Northern Territory Treasury Corporation (NTTC) to assist CDU to finance the construction. The University made two drawdowns totalling $12.0 million during 2013 and paid back this amount in February 2014. These drawdowns were not due to be repaid until 2015.

CDU also participates in a number of other joint venture entities for which the University's interest is not considered to be material. Accordingly, they have not been taken up in the accounts on an equity or proportional consolidation basis as per Australian Accounting Standard AASB 131 Interest in Joint Ventures .




NOTE 40: FINANCIAL RISK MANAGEMENTFinancial risk management

(a) Market risk(i) Foreign exchange risk

(ii) Price risk

(iv) Summarised sensitivity analysis

The following table summarises the sensitivity of the Group's financial assets and financial liabilities to interest rate risk, foreign exchange risk and other price risk. There have been no changes from the previous period in the methods and assumptions used.

Significant assumptions used in the interest rate sensitivity analysis include, reasonably possible movements in interest rates determined based on the Group's mix of investments in Australia, relationships with financial institutions as well as the last two year's historical movements and economic forecaster's expectations.

As the Group does not engage in hedging it is subject to market variations in foreign exchange. The majority of its income and expenditure for foreign currency is the US dollar which has been subject to range of $0.17 from the lowest exchange rate received to the highest in 2013. The range in 2012 was $0.11. The Australian dollar has been at historically high levels against the US dollar based on long term average rates. Forecasts vary on the expectations of the exchange rate for 2014. The Group has factored in a 10% variation ($ 0.10) based on the 2013 average of $0.95.

The Group has $18 million in borrowings as at balance date. The entity's funds on deposit are at rates fixed for the term of the deposit. At balance date, all funds were deposited with ADIs with Standard and Poor's credit ratings of A-2 or higher and/or Northern Territory Government guaranteed as per parent policy. Movement of rates will not affect the fair value of the assets as the deposits will be held to maturity. At call funds are subject to market rate movements. During 2013 the term deposit interest rate range was 1.2%. This is compared to the interest rate range in 2012 of 2.07%. The decrease in interest rate range from 2012 to 2013 reflects the movement in the cash rate as determined by the Reserve Bank of Australia. There was a decrease in the cash rate of 50 basis points in 2013 and a total of 201 basis points from November 2011 to December 2013. The interest rate outlook for 2013 is likely to remain in the target range of 2%.

The Group's activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The Group's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Group. There has been no significant change in the risk factors from the prior year or management thereof.

The Group's financial instruments consist mainly of deposits with banks, accounts receivable and payables. The main risks that the Group is exposed through financial instruments are deposit interest rate risk and credit risk. Any borrowings are at fixed interest rates and consequently upward risk is minimal.

Foreign exchange risk arises from overseas sources of income for research and consultancies and payments to creditors for overseas sourced supplies. The main currencies the University is exposed to are the US dollar followed by British pounds and the Euro. The level of exposure to foreign exchange risk is not considered to be material. The Group does not engage in hedge contracts or other hedging instruments.

The Group has limited exposure to financial instruments subject to price risk. The parent's investment policy is limited to deposits in Authorised Deposit-taking Institutions (ADIs). Some of the entities controlled by the Group have exposure to shares. The level of exposure is not considered material.

(iii) Cash flow and fair value interest rate risk




NOTE 40: FINANCIAL RISK MANAGEMENT Continued

Result $'000

Equity $'000

Result $'000

Equity $'000

Financial assets Cash and cash equivalents 130,958 (2,619) (2,619) 2,619 2,619Total increase/(decrease) (2,619) (2,619) 2,619 2,61931 December 2012Financial assets Cash and cash equivalents 130,789 (2,616) (2,616) 2,616 2,616Total increase/(decrease) (2,616) (2,616) 2,616 2,616

(b) Credit risk

(c) Liquidity risk

(d) Fair value estimation

Due to the short-term nature of the current receivables, their carrying value is assumed to approximate their fair value and based on credit history it is expected that the receivables that are neither past due nor impaired will be received when due.

The movements in result are due to higher/lower interest revenue from variable rate cash balances. Borrowings are at fixed interest rates.

The Group's exposure to credit risk is mainly restricted to receivables. The Group does not have significant exposure to any one debtor. At balance date, all funds were deposited with Authorised Deposit-taking Institutions with Standard and Poor's credit ratings of A-2 or higher and/or Territory Government guaranteed as per the investment policy of the parent entity. The consolidated entity's maximum exposure to credit risk at balance date in relation to each class of recognised financial asset is the carrying amount of those assets as indicated in the balance sheet.

There is no significant risk associated with the Group meeting its obligations associated with financial liabilities. Cashflow to meet ongoing commitments is monitored daily. Strict budgeting and forecasting procedures are in place.

The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. The fair value of financial instruments traded in active markets (such as publicly-traded derivatives) is based on quoted market prices at the balance sheet date. The quoted market price used for financial assets held by the Group is the current bid price.

The carrying value less impairment provision of trade receivables and payables is a reasonable approximation of their fair values due to their short-term nature of trade receivables and payables.

At December 2013, if interest rates had moved, as illustrated in the table below, with all the other variables held constant, result and equity would have been affected as follows:

31 December 2013

Consolidated carrying

amount $'000

Interest rate risk-2% +2%


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1. In our opinion:

(a) the accompanying financial statements of the University and the economic entity are drawn up so asto give a true and fair view of the state of affairs as at 31 December 2013, and the results for the yearended on that date, of the University and the economic entity; and

(b) at the date of this statement there are reasonable grounds to believe that the University will be ableto pay its debts as and when they fall due.

2. The accompanying financial statements and notes thereto, of the University and the economic entity have been made out in accordance with the Charles Darwin University Act and Australian AccountingStandards and as per the Department of Education Guidelines for the Preparation of Annual FinancialStatements for the 2013 Reporting Period by Australian Higher Education Institutions.

3. The amount of Australian Government financial assistance expended during the reporting periodwas for the purpose(s) for which it was provided.

4. Charles Darwin University has complied with the requirements of various program guidelines thatapply to the Australian Government financial assistance identified in the financial statements.

Signed at Darwin this day of 2014

CHANCELLOR VICE-CHANCELLOR

Charles Darwin UniversityDarwin NT 0909 AustraliaT. +61 8 8946 6666W. cdu.edu.auCRICOS Provider No. 00300K (NT) 03286A (NSW)RTO Provider No. 0373

Front cover photograph: Australian Centre for Indigenous Knowledges and Education, Casuarina campusBack cover photographs: A and B Alice Springs campus; C Palmerston campus; D Katherine Rural Campus

B

A

C

D

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