arthritis nsw annual report 2011

Annual Report

2010/11

ContentsA message from the President 02A message from the Chief Executive 03Staffing and Board of Directors 04An overview of activities in 2010/2011 06A Robust Branch Network throughout NSW 09Promoting Research 10 Ensuring sustainability through good governance 10A strong membership base across NSW 11Growing our brand and achieving regular and sustained income 11Developing Strategic Partnerships 13Directors’ Report 14Financials 18Directors’ Declaration 33Report on the financial report 34Declaration by Chief Executive Officer in respect of fundraising appeals 37

This has been a signifi cant year for Arthritis NSW. It has been a year in which our organisation has needed to rise to meet many challenges. Some diffi cult decisions have had to be made to ensure our ongoing viability, so we can continue, over the longer term, to improve the situation for people who have arthritis.

In previous years, we have been the recipient of generous bequests, which have really kept us going. This year bequest income has reduced and forced us to make some decisions that have been necessary but not desirable. This has included a review of staff , a cutback in resources and a one year break for Camp Footloose (returning bigger and better in 2012!). As President I can assure you that decisions we have made this year have been ALL about keeping Arthritis NSW around for a long time to come.

Whist there have been challenges we have also made good progress in many areas. We have contributed to the development of a new model of care for juvenile arthritis in the health system (a combined eff ort between Arthritis NSW & the Agency for Clinical Innovation). We have completed a randomised control trial with the University of NSW for our Moving On program. We also have rolled out three new face-to-face self-management programs (Osteoarthritis of the Knee, Rheumatoid Arthritis program and Osteoporosis program). Additionally we have launched an update of our Challenging Arthritis online self-management program.

We have several new branches and a fantastic new website. Lots of things are happening that are designed to improve wellbeing for people of all ages with arthritis.

This progress is exciting and a credit to all involved. I would like to make special mention to our staff and CEO, for their hard work and dedication. Working for a charity takes a special commitment and as members we should be proud of the good work our team does.

A special mention should also be made to our Board for their hard work this year. Most people don’t see or realise the amount of unpaid work our Board undertakes on behalf of the organisation.

I have been well placed during the years, as President I have been amazed at the skills we have within our organisation, at professional and voluntary levels.

On another note I would like to announce that I will shortly step down as President. I have led Arthritis NSW for a decade and have had the good fortune to preside over many changes and advances in that period of time. It has been a privilege and an honour to be a part of Arthritis NSW and I hope I have made a diff erence to the lives of people who have arthritis in some small way.

David Riches

President

A message fromthe President

w

David Riches

President

Annual Report 2010/11 | 2

ARN0027 Annual Report 2011.indd 2ARN0027 Annual Report 2011.indd 2 2/11/11 1:52 PM2/11/11 1:52 PMProcess CyanProcess CyanProcess MagentaProcess MagentaProcess YellowProcess YellowProcess BlackProcess Black

3 | Arthritis New South Wales

I would like to support comments made by our President in his message, regarding the challenges over the last 12 months for our organisation. The last year has involved changes to our service delivery model, to help us build greater sustainability in our organisation. While the decisions were hard to make, they were done in consideration of our overall needs.

In reviewing the last 12 months, I thought I would highlight the complexity of Arthritis NSW. Whilst we are a charity and a not-for-profi t organisation, we have to run our operations in a business-like manner in order to sustain our services over the long-term. We have a complex set of relationships and partners, all of whom contribute to our work and our profi le. Internal relationships include members, staff , volunteers, Board Directors, Board Subcommittee members and our 44 branches (comprising 132 main offi ce bearers).

Externally, we work with other state Arthritis offi ces and the national Arthritis Australia offi ce, as well as the NSW Health Department, the NSW Agency for Clinical Innovation, the Hargraves Institute, various medical specialists, allied health staff , hospital staff across the state, consumer organisations, philanthropic organisations, universities, sponsors, community groups and the general public.

I am pleased to say that our partnership with the NSW Agency for Clinical Innovation has lead to development of new models of care in the health system for osteoporosis and juvenile idiopathic arthritis. A model of care for osteoarthritis is also currently in development.

Thank you to all our partners who have helped us work towards improved quality of life for people with musculoskeletal diseases.

Karen Filocamo

Chief Executive

A message from the Chief Executive



ARTHRITIS NSW STAFFThis year we welcomed our new Marketing and Fundraising Manager, Rob Novotny, our new Business Manager, Therese Carew and Executive Assistant, Brooke Jay. All these people came to us with valuable knowledge and experience, injecting new life into the organisation. Nena Doyle, previously the Community Liaison Offi cer for the Blue Mountains, also changed positions becoming our Branches and Community Liaison Offi cer.

We bid farewell to the following staff ; Dianne Kingswell, Liz McPhee, Jacqui Louth, Nadine Garland Caroline Stern and Tina McKeown. We thank them for their contribution to the organisation.

Our staff currently includes: Karen FilocamoChief ExecutiveBachelor of Arts (Communication), Masters Health Administration

Dianne SpraggManager, Health Promotion & Self-DevelopmentBachelor Applied Science (Physiotherapy), Masters of Public Health

Rob NovotnyMarketing and Fundraising ManagerBachelor of Business (Marketing), ADMA DM Certifi cate

Therese Carew Finance ManagerAssoc. Dip. Data Comms.Certifi cate of Book keeping

Eloise BuggySelf-Management Program Development Offi cerBachelor of Science, Masters of Public Health

Carol BarnesHealth Promotion Offi cer & Moving On AdvisorRegistered Nurse, Bachelor of Arts, Master of Arts

Melissa DenhamMembership Offi cer & Warm Water Exercise Coordinator

Clarissa JonesFinance Assistant and Kidsfl ix Coordinator

Ingrid PlayerReceptionist and Information Offi cer

Brooke JayExecutive Assistant

Nena DoyleBranches and Community Liaison Offi cer

Staffi ng and Board of Directors



Board of Directors We are fortunate to have the support of a diverse range of dedicated people who fulfi ll the role of Board Directors in our organisation.

These people are:

David Riches, President Dennis Messner, Hon. Treasurer Evan Manolios, Company Secretary Diana Aspinall Prof Nick Manolios A/Prof Ben Marosszeky Greg Monaghan Cosi Pupo Neil Wildman Judith Cantor

Once again, this year the Board had two successful planning days, which addressed governance issues within the organisation.

We would also like to thank the following people who have assisted the Board through their participation in Board subcommittees:

Research Committee Jo Mitchell Dr Tanya Covic

Education Committee Verona Du Toit Bill Brennan Dr Ana Ananda Nadine Morkos Kim Hamrosi

We appreciate all of these people giving their time so willingly to support our organisation.

VolunteersArthritis NSW could not function without our incredibly dedicated volunteers who work alongside us all year. The following people fulfi lled various roles in the organisation and contributed to our ongoing success:

Beryl Lott Colleen Wellsmore Dianne Morris Doris Carrall Elmo Meadley Toni Markovina Kuan Chen

We must also make special mention of all the volunteers who run our branch and support group networks throughout New South Wales. Many of these people have fulfi lled these roles for more than 20 years and we are extremely grateful. To all our branch executives we say a huge thank you for everything you do for the arthritis community.

We would also like to sincerely thank all our volunteer warm water exercise leaders around the state. We could not provide these sessions without these dedicated leaders and pool captains.



THIS YEAR’S ANNUAL REPORT FOCUSES ON EACH OF THE KEY AREAS IN OUR STRATEGIC PLAN. Arthritis NSW incorporating Osteoporosis NSW, provides up-to-date information and education to the community and health professionals about arthritis and other musculoskeletal conditions.

SeminarsDuring 2010/2011 there were seven community seminars held. An eff ort is always made to balance seminars between city and regional areas, and as a result community seminars were held at Batemans Bay, Bondi Junction, Gosford, Maitland, Mudgee, Petersham and Taree. The seminars at Gosford and Petersham were held on World Osteoporosis Day 2010 and focused on aspects of osteoporosis management. All other seminars focused on arthritis, including the Batemans Bay and Maitland events that were held as part of Arthritis Awareness Week. Attendance at seminars ranged from 18 to 70 people. Total attendance for the seven seminars was 318, with an average attendance of 45.

In addition to the community events, a health professional seminar was held on World Osteoporosis Day at Gosford, and was attended by 18 nursing and allied health professionals.

A huge thank you is extended to all rheumatologists, orthopaedic surgeons and allied health professionals that made themselves available to present at these events. These specialists and health professionals donate their time to these events and without their support, they would not be possible.

WebinarsFriday 1 April 2011 saw Arthritis NSW’s fi rst webinar. The webinar was held for health professionals as part of Arthritis Awareness Week. It was presented by rheumatologist, Dr David Hunter, on the latest advances in osteoarthritis research. Forty-eight health professionals from around NSW and further afi eld participated in the event. In the future the webinar format will be utilised further to help reach a broader audience, particularly those of working age and in rural or remote areas.

Community Education SessionsEducation sessions remain an integral part of the health promotion team’s work. Over the last year a new education session on complementary therapies has been developed in response to demand and the fact that many people, with arthritis, use complementary medicines or treatments.

During 2010/2011 the team conducted 80 community education sessions to a total of 1,607 participants. Community education sessions are presented to a number of diff erent types of groups, these are summarised in the following table over the page;

An overview of activities in 2010/2011



Group Number of sessionsCommunity groups 39Multicultural groups 14Branches 13Falls preventions –‘Stepping On’ program 6Aged care facilities (residents) 3Workplace 2DVA peer support 2Aged care facility (staff ) 1Total 80

Arthritis Awareness WeekArthritis Awareness Week 2011 was celebrated in the week beginning Sunday 27 March. During this week a number of activities were conducted including ‘Splash for Arthritis’, the launch of the revised Challenging Arthritis self-management program, two community education seminars, a health professionals’ webinar and a children’s and young adult’s picnic. A special thank you goes to the Ku-ring-gai Lions Club who provided the barbeque at the picnic.

Telephone Information ServiceOur telephone information service continues to operate to assist people with information regarding the management of their arthritis and/or osteoporosis. Most frequently, callers are seeking information on medicines, pain management, exercise, diet and complementary therapies among a variety of other topics. In 2010/2011 the service completed 1,613 calls.

Self-management ProgramsThe range of self-management programs available has grown over the last year with the introduction of a new osteoporosis self-management program and the launch of the newly revised and enhanced Challenging Arthritis program. There are now a total of fi ve programs available to the public which include the two new programs, along with the Osteoarthritis of the Knee (OAK) program, Rheumatoid Arthritis Program (RA-P) and the Moving On program.

The fi rst osteoporosis program was run successfully on the Central Coast in March 2011 and was attended by 10 participants.

Twenty-fi ve participants completed the OAK program during the year and 19 participants completed RA-P.



The Moving On program has been evaluated by the University of NSW through a randomised control trial and the fi ndings have been very positive. In addition a qualitative study was undertaken by the University of Sydney, as a result of a project in conjunction with the Blue Mountains Division of General Practice. The program is now being revised in response to the program evaluation recommendations and will be made available to the community in early 2012.

Camp FootlooseCamp Footloose is an annual camp for children aged 8–18 with JIA. The 2010 camp was held at the Milson Island Sport and Recreation Camp on the Hawkesbury River. The camp was supported by funding from Arthritis Australia. The 2010 camp was also supported by donations from the All British Car Club, Sydney Water and a grant from the ANZ Foundation. As always, Arthritis NSW branches also made generous contributions to the camp. All branches and supporters involved in making contributions to the camp are gratefully acknowledged.

Camp TwinkletoesCamp Twinkletoes is an annual camp for children under eight years of age with JIA, their families and carers. The 2011 camp was held from 6–8 May at The Tops Convention Centre, Stanwell Tops, and was attended by seven families. Sincere appreciation is extended to Arthritis NSW branches whose donations again, supported the camp. This year’s camp was also supported by a grant from the St George Foundation.

Other Education Team activitiesOther health promotion team activities conducted during the year included participation in the following events;

QANTAS staff expo Department of Veterans Aff airs expo University of NSW medical students expo CPSA volunteer community speaker training Flintwood Disability Services Women’s Health

information evening NSW Health, Health Professional’s Falls

Prevention Network Forum Agency for Clinical Innovation Osteoporosis

Model of Care launch.



Our branches and support groups remain our most valuable asset. This has been a diffi cult year for many branches because after serving for long periods of time (sometimes 25 years or more), some of our offi ce bearers needed to step down. This was sometimes due to illness, ageing or increasing frailty. Branches are fi nding it hard to replace these wonderful people because sadly although a branch may have a robust membership, people are often reluctant to step up to an offi ce bearer position.

We are extremely grateful for all the support offi ce bearers have given us over long periods of time.

This year saw the closure of our Mudgee Support Group and Forster/Tuncurry. We want to thank Dorothy Munns from Mudgee and Margaret Sims from Foster/Tuncurry for all their dedicated work with these groups.

While some branches closed, others began, with new groups starting in Macarthur, Newcastle and Batemans Bay. We give a warm welcome to the members of these groups.

In 2010 our Life Membership Awards were

given to:

Dorothy Moss (Lower Clarence) Esther Evans (Albury) Phyllis Spain (Wollongong)

Regional meetings were held this year in Orange, Grafton, Bowral, Ryde, Gosford, Taree, Maitland and Wagga Wagga. These meetings are a valuable opportunity to discuss branch issues and inform members about state and national activities. Focus groups were conducted at all regional meetings this year to identify members’ views about the objectives of a branch or support group. These focus group discussions also explored which membership activities are most valued by our members.

A ROBUST BRANCH NETWORK THROUGHOUT NSW



Arthritis NSW understands our members expect us to support research studies into causes and treatment for arthritis. While we hope that one day a cure will be found, we recognise it is equally important to help people of all ages to live well each day with arthritis and achieve their best possible quality of life. This year we were involved in the following research studies:

The Moving On program, a chronic disease self-management program. This year the University of NSW completed a randomised control trial of the program. The study was supported by Northern Sydney/Central Coast Area Health Service and Sydney West Area Health Service, as well as GP Network Northside, Wentwest Division of General Practice, Hawkesbury Hills Division of General Practice and Blue Mountains Division of General Practice. The study fi ndings have been positive and we will be implementing the program widely in the coming year.

The Motherhood Choices Project. This project is a University of Western Sydney project, addressing issues of pregnancy and childbirth for women with rheumatoid arthritis.

Westmead Hospital’s Rheumatology Unit, where we continue to support a Senior Lecturer position to maintain and advance the unit’s research and teaching activities.

Last year’s Annual General Meeting included a lengthy presentation from four research projects supported by our organisation over the last three years.

ENSURING SUSTAINABILITY THROUGH GOOD GOVERNANCE

Finance ReportAs mentioned in the President’s Report, our income for this year has been substantially aff ected by declining bequests to our organisation. Bequests received for the year amounted to $296,496 compared to $650,494 for 2009/2010.

The operations of Arthritis NSW for the year 2010/2011 resulted in a defi cit of $558,642 compared to a loss of $144,983 for 2009/2010.

We recognise and greatly appreciate the bequests we received this year through the following estates:

Mr Barry Bristow Mrs Dorothy Carthew Ms Stephanie Blatchford Mrs CM Dalziel Mr Michael John Roth Mrs Marjorie Lawn Ms Kathleen McNulty Mr George Thomas Richards Ms Henry Webb Mr Daniel Murphy

We recognise the contribution of the fi nance, research and education Board Subcommittees to the governance of our organisation.

PROMOTING RESEARCH



Our membership total for 2010/11 was 5,140. This represents only a small increase compared to 2009/10 (with 5,102 members). The number of new members joining the organisation was 647 during the year.

We are currently implementing a new membership scheme, making membership easier for members and also providing more member benefi ts. There will also be slight price increases across all memberships, to address the overall loss from our membership program.

GROWING OUR BRAND AND ACHIEVING REGULAR AND SUSTAINED INCOME

This year we received ongoing support from the government, corporate and other generous supporters.

Government GrantsWe received $38,000 from Sydney West Area Health Service under the Non-Government Organisation funding program. We gratefully acknowledge the support of NSW Health in providing this grant which contributes to education activities.

Pfi zer AustraliaWe received a special grant of $4,500 from Pfi zer Australia for our fi rst annual “Splash for Arthritis” event during Arthritis Awareness Week. We thank them for their special contribution to the organisation.

St George FoundationIn April we received a grant of $9,798 from the St George Foundation, towards the costs of Camp Twinkletoes, our annual weekend camp for children with JIA, less than eight years of age and their families. We express our appreciation to St George for supporting the camp.

All British Car ClubOnce again, this year the All British Car Club has provided wonderful support to us with a donation of $8,000 from their annual display at The Kings School. We appreciate the ongoing support we receive from this car club which goes towards Camp Footloose.

Arthritis Summer ChallengeAs the inaugural event for Arthritis NSW, the Arthritis Summer Challenge saw a total of 20 individuals and groups raise $14,000 for Arthritis NSW. Some of the activities included a walk, run, fi tness class, Zumba class, and a morning and afternoon tea.

Splash for ArthritisOur fi rst event during Arthritis Awareness Week - “Splash for Arthritis”, Australia’s largest water exercise class saw a total of 120 people attend. Sponsorship was received from from Pfi zer, Cojo, DKM Blue and Mix 106.5 FM and we thank them for their support. This event generated interest from The Today Show, Sunday Telegraph and many local newspapers.

A STRONG MEMBERSHIP BASE ACROSS NSW



DonorsIn these diffi cult economic times we depend on the generosity of donors to enable us to continue providing our diverse range of services. Apart from appeals, we have received donations from other sources including general donations, donations through our magazine Arthritis Matters and Christmas card donations. In 2010/11, we raised a total of $86,194 from 1,372 supporters.

Kidsfl ixKidsfl ix continues to be a successful activity for children across NSW with juvenile arthritis or other physical disabilities. As well as seeing a current movie; drinks, popcorn, clowns and face painters add to the fun. This year Kidsfl ix movie days were held at Ballina, Bathurst, Castle Hill, Charlestown, Dubbo, Erina, Miranda, Orange, Penrith, Shellharbour, Sydney Entertainment Quarter and Warringah Mall.

Kidsfl ix has generated $184,497 for Arthritis NSW in 2010/11. We sincerely thank everyone who has donated to Kidsfl ix and a special thanks to Clarissa Jones, from our offi ce, for coordinating the activity and attending whenever possible, to help it run smoothly. We also thank those local branches who gave up their time to help out as well.

Alison Watson Memorial Scholarship AwardThis year the Alison Watson Memorial Scholarship was awarded to Megan Congdon. This award is in memory of Alison Watson who triumphed over her crippling arthritis to help our organisation in our early days of development.

WINTER 2011

ARN0001 Arthritis Matters Cover.indd 3-4 30/05/11 12:46 PMProcess CyanProcess MagentaProcess YellowProcess Black

Arthritis MattersOur magazine has gone from strength-to-strength focusing more on the needs of our members. We would like to thank everyone who contributed to the magazine. During the next fi nancial year, we will also be introducing a bi-monthly e-newsletter for our members with e-mail addresses.

WebsiteWe are continually updating our website to make it easier to navigate while further developing our online capabilities.

Appeals

Given the small amount of government funding we receive, we could not function without the support from our appeals. Thanks to the generosity of 1,293 supporters, in 2010/11 we raised a total of $102,737; this is up from $44,176 in 2009/10. This year we will continue with the same number of appeals and will continue to develop fundraising strategies such as follow-up mailings for our regular appeals.



DEVELOPING STRATEGIC PARTNERSHIPSArthritis NSW benefi ts from strong partnerships with health service agencies, other sectors and individual health professionals to help achieve its goals. During the last 12 months we collaborated with:

University of NSW in the Moving On program

University of Western Sydney in the Motherhood Choices project

The Agency for Clinical Innovation through the NSW Musculoskeletal Network

Consumers Health Forum through the representation of Board Director Diana Aspinall who raises issues relevant to people with arthritis and osteoporosis

A range of allied health and medical staff including orthopaedic surgeons and rheumatologists

Education & Training Committee of Australia New Zealand College of Anaesthetists through representation of Board Director Diana Aspinall who provides a consumer perspective on curriculum development

QUM Advisory Committee – University of South Australia through the representation of Board Director Diana Aspinall. This committee looks at issues related to medicine use amongst veterans

NPS Better Choices – Better Health Consumer Advisory Group through the representation of Board Director Diana Aspinall. This focus of this group is quality use of medicines

Painaustralia Limited through the participation of Board Director Diana Aspinall, who is also on the Board of this organisation

Department of Health & Ageing and the Pharmacy Guild of Australia who are developing a Patient Charter for Community Pharmacies.

We particularly wish to thank Professor David Hunter, from Royal North Shore Hospital, for his support with our fi rst webinar for health professionals, along with other activities completed together throughout the year and Dr Davinder Singh Grewal for his support with activities to Juvenile Idiopathic Arthritis.



Arthritis Foundation of New South Wales

Directors’ ReportFOR THE YEAR ENDED 30 JUNE 2011The directors present their report together with the fi nancial statements of Arthritis Foundation of New South Wales (the Company) for the fi nancial year ended 30 June 2011 and the auditor’s report thereon.

1 DirectorsThe directors of the Company at any time during or since the end of the fi nancial year are:

Name, Qualifi cations Experience Age Appointed Resigned

Mr David Riches President Health Promotion Consultant 54 22 Dec. 2001

A/Prof. Jeno Emil Marosszeky Senior Specialist Rehabilitation 73 21 March 1988MB, BS, DPRM, FACRM MedicineChairman - Education Committee

Mr Dennis Messner Chartered Accountant 59 17 April 2002Honorary Treasurer - Aug 2005

Ms Diana Aspinall Consumer Representative 72 2 November 2001

Ms Diana Sykes Marketing Consultant 47 21 April 2001 18 Sept. 2010

Prof Nicholas Manolios Rheumatologist 58 18 November 2009

Mr Gregory Monaghan Executive and Company Director 56 17 October 2007

Ms Cosimina Pupo Legal Consultant 56 19 December 2007

Mr Neil Wildman Mental Health and Management 36 18 September 2010

Mr Russell Moor Branches Representative 78 1 August 2008 18 Sept. 2010

Ms Judith Cantor Marketing and Fundraising 37 16 November 2010

Ms Beverley Walker Consumer 65 18 September 2010 6 April 2011



Directors’ Report (continued)For the year ended 30 June 2011

2 Directors’ meetingsThe number of directors’ meetings and number of meetings attended by each of the directors of the Company during the fi nancial year are:

Director Directors’ Meetings

A B

Mr D Riches 8 9A/Prof. J E Marosszeky 9 9Mr D Messner 8 9Ms D Aspinall 7 9Ms D Sykes 3 9Prof N Manolios 6 9Mr G Monaghan 5 9Ms C Pupo 8 9Mr N Wildman 7 9Mr R Moor 2 9Ms J Cantor 3 9Ms B Walker 2 9

A – Number of meetings attendedB – Number of meetings held during the time the director held offi ce during the year

3 Objectives and strategyThe Company’s short term objectives are to expand the current target groups and develop innovative programs for groups including: young adults living with arthritis and other musculoskeletal conditions, parents of children with juvenile idiopathic arthritis, residents living in the boundary of Greater Western Area Health Service, general practitioners in rural regions of NSW.

The Company’s long term objective is to promote the quality of life of people living with arthritis and other musculoskeletal conditions.

The Company measures its performance by benchmarking its progress against its strategic objectives:

providing up to date information and eductaion to the community developing and maintaing a robust branch structure through NSW developing and maintaing a string membership base through NSW promoting research ensuirng sustainability through good governance developing strategic partnerships.



4. Principal activitiesThe principal activities of the Company during the course of the fi nancial year were research into arthritis and osteoporosis, the provision of educational material on arthritis and osteoporosis and fundraising activities to fi nance these activities.

There were no signifi cant changes in the nature of the activities of the Company during the year.

5. Operating and fi nancial reviewThe defi cit of the Company for the year ended 30 June 2011 was $572,437 (2010: $171,321).

6. MembershipThe Company is a public company limited by guarantee and without share capital. Under the terms of the Company’s Memorandum of Association, every member of the Company undertakes to contribute to the assets of the Company in the event of it being wound up while that person is a member, or within one year after ceasing to be a member, for:

payment of the debts and liabilities of the Company (contracted before ceasing to be a member);

the costs, charges and expenses of winding up; and

the adjustments of the rights of the contributories amongst themselves.

Such amount as may be required but not exceeding twenty dollars ($20) per member. The number of members as at 30 June 2011 was 4,750 (2010: 4,918). The total amount that members of the Company are liable to contribute if the Company is wound up is $95,000 (2010: $98,360).

7. Lead auditor’s independence declarationThe Lead auditor’s independence declaration is set out on page 5 and forms part of the directors’ report for the fi nancial year ended 30 June 2011.

This report is made in accordance with a resolution of the directors:

Mr D RichesDirector

Mr D MessnerDirector

Dated at Sydney this 19th day of October 2011. Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

Mr D RicchesDirector

Mrrrrrrrrrrrrrrrrrrrrrr DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD MMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMeseeeee snerDiDiDiiDiDiDiiiDiiDiDiiDiDiiDiDiiDDDiiiDDiiiDDiDiiDDiiDiiDiDDiDDDDDDDDDDDDDDDDDDDDD reeeeeeeeeeeeeeeeeeeeeeeeeeeeeeeectctctctctctcctcttcttctctctcttttctctctctcttctcctctctcctctctccctctccccctcccccccccccctcccccccccccccccccccccccccc or



Lead Auditor’s Independence Declaration under Section 307C of the Corporations Act 2001

To: the directors of Arthritis Foundation of New South Wales

I declare that, to the best of my knowledge and belief, in relation to the audit for the fi nancial year ended 30 June 2011, there have been:

(i) no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and

(ii) no contraventions of any applicable code of professional conduct in relation to the audit.

Carlo PasqualiniPartnerSydney19 October 2011

We have audited the accompanying fi nancial report of Arthritis Foundation of New South Wales (the Company), which comprises the statement of fi nancial position as at 30 June 2011, the statement of comprehensive income, statement of changes in members’ funds and statement of cash fl ows for the year ended on that date, notes 1 to 20 comprising a summary of signifi cant accounting policies and other explanatory information and the directors’ declaration.

The directors of the Company are responsible for the preparation of the fi nancial report that gives a true and fair view in accordance with Australian Accounting Standards – Reduced Disclosure Requirements and the Corporations Act 2001 and for such internal control as the directors determine is necessary to enable the preparation of the fi nancial report that is free from material misstatement whether due to fraud or error.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the fi nancial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of the fi nancial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the eff ectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall resentation of the fi nancial report.



Arthritis Foundation of New South WalesStatement of fi nancial positions at 30 June 2011

In AUD Note 2011 2010

Revenue 4 1,126,152 1,340,409

Other income 5 - 307,607

Administrative expenses (1,416,774) (1,365,421)

Education expenses (198,427) (319,394)

Research expenses (17,667) (82,257)

Depreciation expense (69,481) (76,876)

Marketing and fundraising expenses (283,084) (281,475)

Results from operating activities (859,281) (477,407)

Finance income 307,392 306,086

Finance costs (20,548) -

Net fi nance income 7 286,844 306,086

Defi cit for the year (572,437) (171,321)

Other comprehensive incomeNet change in fair value of available-for-sale fi nancial assets (6,753) 26,338

Cumulative impairment losses on available-for-sale fi nancial assets reclassifi ed to profi t or loss 20,548 -

Other comprehensive income for the year 13,795 26,338

Total comprehensive loss for the year (558,642) (144,983)

The notes on pages 10 to 22 are an integral part of these fi nancial statements.





Assets

Current Assets

Cash and cash equivalents 8 4,876,439 5,328,235

Trade and other receivables 9 92,305 171,264

Inventories 10 12,825 12,825

Total current assets 4,981,569 5,512,324

Non-current Assets

Other investments 11 253,305 260,058

Investment property 12 - -

Property, plant and equipment 13 1,321,879 1,388,940

Total non-current assets 1,575,184 1,648,998

Total assets 6,556,753 7,161,322

Liabilities

Current liabilities

Trade and other payables 14 210,006 255,933

Employee benefi ts 15 96,480 96,480

Total current liabilities 306,486 352,413

Non-current liabilities

Employee benefi ts 15 15,133 15,133

Total non-current liabilities 15,133 15,133

Total liabilities 321,619 367,546

Net assets 6,235,134 6,793,776

Members' funds

Reserves 16 146,828 133,033

Retained surplus 6,088,306 6,660,743

Total members' funds 6,235,134 6,793,776





In AUD

Research

reserves

- McGill

Medical

Research

Trust

reserve

Research

reserves -

Education

reserve

- Alison

Watson

Fair value

reserve

Retained

surplus

Total

members'

funds

Balance at 1 July 2009 3,012 104,033 (350) 6,832,064 6,938,759

Total comprehensive income for the yearDefi cit for the year - - - (171,321) (171,321)

Other comprehensive income

Net change in fair value of available-for-sale fi nancial assets - - 26,338 - 26,338

Total other comprehensive income - - 26,338 - 26,338

Total comprehensive loss for the year - - 26,338 (171,321) (144,983)

Balance at 30 June 2010 3,012 104,033 25,988 6,660,743 6,793,776

Balance at 1 July 2010 3,012 104,033 25,988 6,660,743 6,793,776

Total comprehensive income for the year

Defi cit for the year - - - (572,437) (572,437)

Other comprehensive incomeNet change in fair value of available-for-sale fi nancial assets - - (6,753) - (6,753)

Cumulative impairment losses on available-for-sale fi nancial assets reclassifi ed to profi t or loss

- - 20,548 - 20,548

Total other comprehensive income - - 13,795 - 13,795

Total comprehensive loss for the year - - 13,795 (572,437) (558,642)

Balance at 30 June 2011 3,012 104,033 39,783 6,088,306






Cash fl ows from operating activities

Cash receipts in the course of operations 1,173,921 1,556,244

Cash payments in the course of operations (1,930,689) (2,146,002)

Cash generated from operations (756,768) (589,758)

Interest received 294,410 203,533

Net cash used in operating activities (462,358) (386,225)

Cash fl ows from investing activities

Proceeds from sale of investment property - 730,000

Acquisition of property, plant and equipment (2,420) (38,705)

Dividends received 12,982 13,767

Incidentals on disposal of investment property - (18,234)

Net cash from investing activities 10,562 686,828

Net (decrease)/increase in cash and cash equivalents (451,796) 300,603

Cash and cash equivalents at beginning of year 5,328,235 5,027,632

Cash and cash equivalents at end of year 8 4,876,439 5,328,235




1 Reporting entityArthritis Foundation of New South Wales (the Company) is a company limited by guarantee and domiciled in Australia. The address of the Company’s registered offi ce is 1, 15/32 Delhi Road, North Ryde NSW 2113. The fi nancial statements are as at and for the year ended 30 June 2011.

The Company is primarily involved in research into arthritis and osteoporosis, the provision of educational material on arthritis and osteoporosis and fundraising activities to fi nance these activities.

2 Basis of preparation (continued)(e) Changes in accounting policies

Presentation of fi nancial statements Trans-Tasman harmonisation and reduced disclosure

The Company early adopted reduced disclosure requirements in AASB 1053 Application of Tiers of Australian Accounting Standards and AASB 2010-02 Amendments to Australian Standards arising from Reduced Disclosure Requirements and Trans-Tasman harmonisation requirements in AASB 1054 Australian Additional Disclosures, AASB 2011-1 Amendments to Australian Accounting Standards arising from the Trans-Tasman Convergence Project and AASB 2011-02 Amendments to Australian Accounting Standards arising from the Trans-Tasman Convergence Project - Reduced Disclosure Requirements. This has resulted in a reduction of disclosures for items such as fi nancial instruments and reconciliation of cash fl ows.

Comparative information has been re-presented or removed so that it also conforms to the new disclosure requirements. Since the change in accounting policy only impacts presentation aspects, there is no impact on comprehensive income.

3 Signifi cant accounting policiesThe accounting policies set out below have been applied consistently to all periods presented in these fi nancial statements.

Certain comparative amounts have been reclassifi ed to conform with the current year’s presentation.

(a) Financial instruments

(i) Non-derivative fi nancial assets

The Company initially recognises loans and receivables and deposits on the date that they are originated. All other fi nancial assets are recognised initially on the date at which the Company becomes a party to the contractual provisions of the instrument.

The Company derecognises a fi nancial asset when the contractual rights to the cash fl ows from the asset expire, or it transfers the rights to receive the contractual cash fl ows on the fi nancial asset in a transaction in which substantially all the risks and rewards of ownership of the fi nancial asset are transferred. Any interest in transferred fi nancial assets that is created or retained by the Company is recognised as a separate asset or liability.

The Company has the following non-derivative fi nancial assets: loans and receivables and available-for-sale fi nancial assets.

Loans and receivables

Loans and receivables are fi nancial assets with fi xed or determinable payments that are not quoted in an active market. Such assets are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition loans and receivables are measured at amortised cost using the eff ective interest method, less any impairment losses.

Loans and receivables comprise cash and cash equivalents and trade and other receivables.

Cash and cash equivalents

Cash and cash equivalents comprise cash balances and call deposits with original maturities of three months or less.



3 Signifi cant accounting policies (continued)

(a) Financial instruments (continued)

(i) Non-derivative fi nancial assets (continued)

Available-for-sale fi nancial assets

The Company’s investments in euity securities are classifi ed as available-for-sale fi nancial assets. Subsequent to initial recognition, they are measured at fair value and changes therein, other than impairment losses (see note 3(e)(i)), are recognised in other comprehensive income and presented in the fair value reserve in members’ funds. When an investment is derecognised, the cumulative gain or loss in members’ funds is transferred to profi t or loss. Fair value is determined using closing bid prices at reporting date.

(ii) Non-derivative fi nancial liabilities

Financial liabilities are recognised initially on the date, which is the date that the Company becomes a party to the contractual provisions of the instrument.

The Company derecognises a fi nancial liability when its contractual obligations are discharged or cancelled or expired.

Financial assets and liabilities are off set and the net amount presented in the statement of fi nancial position when, and only when, the Company has a legal right to off set the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

The Company classifi es non-derivative fi nancial liabilities into the other fi nancial liabilities category. Such fi nancial liabilities are recognised initially at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, these fi nancial liabilities are measured at amortised cost using the eff ective interest method.

Other fi nancial liabilities comprise trade and other payables.

(b) Property, plant and equipment

(i) Recognition and measurement

Items of property, plant and equipment are measured at cost less accumulated depreciation and accumulated impairment losses.

Cost includes expenditure that is directly attributable to the acquisition of the asset.

When parts of an item of property, plant and equipment have diff erent useful lives, they are accounted for as separate items (major components) of property, plant and equipment.

The gain or loss on disposal of an item of property, plant and equipment is determined by comparing the proceeds from disposal with the carrying amount of the property, plant and equipment, and is recognised net within other income/other expenses in profi t or loss.

(ii) Subsequent costs

The cost of replacing a component of an item of property, plant and equipment is recognised in the carrying amount of the item if it is probable that the future economic benefi ts embodied within the component will fl ow to the Company, and its cost can be measured reliably. The carrying amount of the replaced part is derecognised. The costs of the day-to-day servicing of property, plant and equipment are recognised in profi t or loss as incurred.

(iii) Depreciation

Depreciation is based on the cost of an asset less its residual value. Signifi cant components of individual assets are assessed and if a component has a useful life that is diff erent from the remainder of that asset, that component is depreciated separately.




(b) Property, plant and equipment (continued)

(iii) Depreciation (continued)

Depreciation is recognised in profi t or loss on a straight-line basis over the estimated useful lives of each component of an item of property, plant and equipment.

The estimated useful lives for the current and comparative years are as follows:

• buildings 40 years• motor vehicles 3 - 5 years• plant and equipment 3 - 5 years

Depreciation methods, useful lives and residual values are reviewed at each reporting date and adjusted if appropriate.

(c) Investment property

“Investment property is property held either to earn rental income or for capital appreciation or for both, but not for sale in the ordinary course of business, use in the production or supply of goods or services or for administrative purposes. Investment property is measured at cost on initial recognition and subsequently at fair value with any change therein recognised in profi t or loss.

Cost includes expenditure that is directly attributable to the acquisition of the investment property.

When the use of a property changes such that it is reclassifi ed as property, plant and equipment, its fair value at the date of reclassifi cation becomes its cost for subsequent accounting.

(d) Inventories

Inventories are measured at the lower of cost and net realisable value. The cost of inventories is based on the fi rst-in fi rst-out principle, and includes expenditure incurred in acquiring the inventories and other costs incurred in bringing them to their existing location and condition.

Net realisable value is the estimated selling price in the ordinary course of business, less the estimated selling expenses.

(e) Impairment

(i) Non-derivative fi nancial assets

Financial asset is assessed at each reporting date to determine whether there is objective evidence that it is impaired. A fi nancial asset is impaired if objective evidence indicates that a loss event has occurred after the initial recognition of the asset, and that the loss event had a negative eff ect on the estimated future cash fl ows of that asset that can be estimated reliably.

Objective evidence that fi nancial assets (including equity securities) are impaired can include default or delinquency by a debtor, restructuring of an amount due to the Company on terms that the Company would not consider otherwise, indications that a debtor or issuer will enter bankruptcy, or economic conditions that correlate with defaults or the disappearance of an active market for a security. In addition, for an investment in an equity security, a signifi cant or prolonged decline in its fair value below its cost is objective evidence of impairment.

The Company considers evidence of impairment for receivables at both a specifi c asset and collective level. All individually signifi cant receivables are assessed for specifi c impairment. All individually signifi cant receivables found not to be specifi cally impaired are then collectively assessed for any impairment that has been incurred but not yet identifi ed. Loans and receivables that are not individually signifi cant are collectively assessed for impairment by grouping together loans and receivables with similar risk characteristics.




(e) Impairment (continued)

(i) Non-derivative fi nancial assets (continued)

In assessing collective impairment the Company uses historical trends of the probability of default, timing of recoveries and the amount of loss incurred, adjusted for management’s judgement as to whether current economic and credit conditions are such that the actual losses are likely to be greater or less than suggested by historical trends.

An impairment loss in respect of a fi nancial asset measured at amortised cost is calculated as the diff erence between its carrying amount and the present value of the estimated future cash fl ows discounted at the asset’s original eff ective interest rate. Losses are recognised in profi t or loss and refl ected in an allowance account against loans and receivables. Interest on the impaired asset continues to be recognised. When a subsequent event (e.g. repayment by a debtor) causes the amount of impairment loss to decrease, the decrease in impairment loss is reversed through profi t or loss.

Available-for-sale fi nancial assets

Impairment losses on available-for-sale fi nancial assets are recognised by reclassifying the losses accumulated in the fair value reserve in members’ funds, to profi t or loss. The cumulative loss that is reclassifi ed from members’ funds to profi t or loss is the diff erence between the acquisition cost, net of any principal repayment and amortisation, and the current fair value, less any impairment loss previously recognised in profi t or loss. Changes in impairment provisions attributable to application of the eff ective interest method are refl ected as a component of interest income.

Any subsequent recovery in the fair value of an impaired available-for-sale equity security is recognised in other comprehensive income.

(ii) Non-fi nancial assets

The carrying amounts of the Company’s non-fi nancial assets, other than inventories, are reviewed at each reporting date to determine whether there is any indication of impairment. If any such indication exists, then the asset’s recoverable amount is estimated. An impairment loss is recognised if the carrying amount of an asset or its related cash-generating unit (CGU) exceeds its estimated recoverable amount.

The recoverable amount of an asset or CGU is the greater of its value in use and its fair value less costs to sell. Depreciated replacement cost is used to determine value in use. Depreciated replacement cost is the current replacement cost of the item less, where applicable, accumulated depreciation to date, calculated on the basis of such cost. For the purpose of impairment testing, assets that cannot be tested individually are grouped together into the smallest group of assets that generates cash infl ows from continuing use that are largely independent of the cash infl ows of other assets or groups of assets the “cash-generating unit” or “CGU”.

Impairment losses are recognised in profi t or loss. Impairment losses recognised in respect of CGUs are allocated to reduce the carrying amounts of the other assets in the CGU (group of CGUs) on a pro rata basis.

Impairment losses recognised in prior periods are assessed at each reporting date for any indications that the loss has decreased or no longer exists. An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset’s carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortisation, if no impairment loss had been recognised.




(f) Employee benefi ts

(i) Defi ned contribution plans

A defi ned contribution plan is a post-employment benefi t plan under which an entity pays fi xed contributions into a separate entity and will have no legal or constructive obligation to pay further amounts. Obligations for contributions to defi ned contribution pension plans are recognised as an employee benefi t expense in profi t or loss in the periods during which services are rendered by employees.

(ii) Other long-term employee benefi ts

The Company’s net obligation in respect of long-term employee benefi ts is the amount of future benefi t that employees have earned in return for their service in the current and prior periods; that benefi t is discounted to determine its present value, and the fair value of any related assets is deducted. The discount rate is the yield at the reporting date on government bonds that have maturity dates approximating the terms of the Company’s obligations.

(iii) Short-term employee benefi ts

Short-term employee benefi t obligations are measured on an undiscounted basis and are expensed as the related service is provided. A liability is recognised for the amount expected to be paid under short-term cash bonus or profi t-sharing plans if the Company has a present legal or constructive obligation to pay this amount as a result of past service provided by the employee, and the obligation can be estimated reliably.

(g) Revenue

(i) Goods sold

Revenue from the sale of goods in the course of ordinary activities is measured at the fair value of the consideration received or receivable, net of returns, discounts and allowances. Revenue is recognised when the signifi cant risks and rewards of ownership have been transferred to the customer, recovery of the consideration is probable, the associated costs and possible return of goods can be estimated reliably, there is no continuing management involvement with the goods, and the amount of revenue can be measured reliably.

(ii) Services

Revenue from services rendered is recognised in profi t or loss in the period in which the service is performed.

(iii) Bequests

Revenue from bequests is recognised in profi t or loss in the period in which it is received and control has passed to the Company.

(iv) Donations, fundraising and grant income

Revenue form donations, fundraising and grants is recognised in profi t or loss when the Company gains control of the contribution or the right to receive the contribution.

(v) Contributions of assets

Contributions of assets such as shares, real property and other securities are recognised in profi t or loss when title passes to the Company at the estimated market value.

(vi) Members’ subscriptions

Members’ subscriptions income is recognised in profi t or loss in the fi nancial year to which the membership relates.




(h) Government grants

An unconditional government grant is recognised when the Company obtains control of the grant or the right to receive the grant; it is probable that the economic benefi ts comprising the grant will fl ow to the Company, and the amount of grant can be measured reliably.

Other grants are recognised initially as deferred income at fair value when there is reasonable assurance that they will be received and the Company will comply with the conditions associated with the grant and are then recognised in profi t or loss as other income on a systematic basis over the useful life of the asset. Grants that compensate the Company for expenses incurred are recognised in profi t or loss as other income on a systematic basis in the same periods in which the expenses are recognised.

(i) Finance income and fi nance costs

Finance income comprises interest income on funds invested, dividend income on available-for-sale fi nancial assets, Interest income is recognised as it accrues in profi t or loss, using the eff ective interest method. Dividend income is recognised in profi t or loss on the date that the Company’s right to receive payment is established, which in the case of quoted securities is normally the ex-dividend date.

Finance costs comprise impairment losses recognised on available-for-sale fi nancial assets.

(j) Income tax

The Company has been granted an income tax exemption under Division 50 of the Income tax Assessment Act 1997.

(k) Goods and services tax

Revenue, expenses and assets are recognised net of the amount of goods and services tax (GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense.

Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or payable to, the ATO is included as a current asset or liability in the statement of fi nancial position.

Cash fl ows are included in the statement of cash fl ows on a gross basis. The GST components of cash fl ows arising from investing and fi nancing activities which are recoverable from, or payable to, the ATO are classifi ed as operating cash fl ows.

(l) New standards and interpretations not yet adopted

A number of new standards, amendments to standards and interpretations are eff ective for annual periods beginning after 1 July 2010, and have not been applied in preparing these fi nancial statements. None of these is expected to have a signifi cant eff ect on the fi nancial statements of the Company, except for AASB 9 Financial Instruments, which becomes mandatory for the Company’s 2014 fi nancial statements and could change the classifi cation and measurement of fi nancial assets. The Company does not plan to adopt this standard early and the extent of the impact has not been determined.




4 RevenueIn AUD 2011 2010

Bequests 296,466 650,494 Members' subscriptions 122,448 129,857 Fundraising appeals 274,290 295,504 Government grant 31,350 37,325 Other revenue 401,598 227,229

1,126,152 1,340,409

5 Other income

In AUD 2011 2010

Net gain on sale of investment property - 307,607 - 307,607

6 Personnel expenses included in the statement of comprehensive income

In AUD 2011 2010

Wages and salaries 902,360 794,540 Contributions to defi ned contribution plans 70,638 74,174 Increase in liability for annual leave - 9,361 Increase in liability for long service leave - 9,515

972,998 887,590

7 Finance income and fi nance costs

In AUD 2011 2010

Interest income on short term deposits 294,410 292,319 Dividend income on available-for-sale fi nancial assets 12,982 13,767 Finance income 307,392 306,086

Impairment loss on available-for-sale fi nancial assets (20,548) - Finance costs (20,548) - Net fi nance income 286,844 306,086

8 Cash and cash equivalents

In AUD 2011 2010



Bank balances 585,934 128,695 Call deposits 4,289,978 5,199,026 Petty cash 527 514 Cash and cash equivalents in the statement of cash fl ows 4,876,439 5,328,235

9 Trade and other receivables

In AUD 2011 2010

CurrentTrade receivables 17,170 33,733 Interest receivable 41,293 105,003 Prepayments 30,108 27,894 Deposits 3,734 4,634

92,305 171,264

10 Inventories

In AUD 2011 2010

Finished goods 12,825 12,825 12,825 12,825

11 Other investments

In AUD 2011 2010

Non-current investmentsAvailable-for-sale fi nancial assets 253,305 260,058

253,305 260,058 12 Investment property

In AUD 2011 2010

Balance at 1 July - 407,752 Depreciation charge for the year - (3,638)Disposals - (404,114)Balance at 30 June - -

Investment property comprises the property previously occupied by the Company at 13 Harold Street, North Parramatta. This was sold on 19 February 2010.

13 Property, plant and equipment

In AUD Buildings Motor Vehicle Plant and equipment Total

Cost



Balance at 1 July 2010 1,368,626 29,665 225,035 1,623,326 Additions 2,420 2,420 Balance at 30 June 2011 1,368,626 29,665 227,455 1,625,746

Depreciation and impairment lossesBalance at 1 July 2010 36,269 24,197 173,920 234,386 Depreciation for the year 34,216 5,468 29,797 69,481 Balance at 30 June 2011 70,485 29,665 203,717 303,867

Carrying amountsAt 1 July 2010 1,332,357 5,468 51,115 1,388,940 At 30 June 2011 1,298,141 23,738 1,321,879

14 Trade and other payables

In AUD 2011 2010

CurrentTrade payables 99,110 88,339 Other payables and accrued expenses 110,896 167,594

210,006 255,933

15 Employee benefi ts

In AUD 2011 2010CurrentLiability for long service leave 12,198 12,198 Liability for annual leave 84,282 84,282

96,480 96,480

Non-currentLiability for long service leave 15,133 15,133

15,133 15,133 16 Reserves

Education reserve - Alison WatsonThe Education reserve represents the funds received to award school children with education assistance who suff er from arthritis.McGill Medical Research Trust reserveThe McGill Medical Research Trust reserve represents the bequest funds received to be specifi cally used in the Newcastle/Hunter region for suff erers of arthritis.Fair value reserveThe fair value reserve comprises the cumulative net change in the fair value of available-for-sale fi nancial assets until the investments are derecognised or impaired.



17 Members’ liabilityThe Company is a public company limited by guarantee and without share capital. Under the terms of the Company’s Memorandum of Association, every member of the Company undertakes to contribute to the assets of the Company in the event of it being wound up while that person is a member, or within one year after ceasing to be a member, for:

- payment of the debts and liabilities of the Company (contracted before ceasing to be a member);- the costs, charges and expenses of winding up; and- the adjustments of the rights of the contributories amongst themselves.

Such amount as may be required but not exceeding twenty dollars ($20) per member. The number of members as at 30 June 2011 was 4,750 (2010: 4,918). The total amount that members of the Company are liable to contribute if the Company is wound up is $95,000 (2010: $98,360).

18 Related parties Transactions with key management personnelIn addition to their salaries, the Company also contributes to post-employment defi ned contribution funds on behalf of key management personnel.

Key management personnel compensationThe key management personnel compensation included in personnel expenses (note 6) was $267,994 for the year ended 30 June 2011 (2010: $268,136).

19 Results of fundraising appealsIn AUD 2011 2010

(i) Gross proceeds from fundraising appeals 146,901 130,992 less: Direct costs of fundraising appeals (50,317) (68,751)Net surplus obtained from fundraising appeals 96,584 62,241

(ii)The net surplus obtained from fundraising appeals was applied against other expenses incurred. The total of other expenses incurred was as follows:

Distributions and direct costs of services provided 469,410 614,378 Administration expenses 1,486,254 1,442,295

1,955,664 2,056,673 Shortfall from fundraising appeals (1,859,080) (1,994,432)

(iii)

The shortfall of $1,859,080 (2010: $1,994,432) between the net surplus obtained from fundraising appeals of $96,584 (2010: $62,241) and expenditure and transfers of $1,955,664 (2010: $2,056,673) was provided from the following sources:

In AUD 2011 2010



Bequests 296,466 650,494 Members' subscriptions 122,448 129,857 Members' donations 17,590 27,170 Government grant 31,350 37,325 Interest on investments 294,410 292,319 Dividends received 12,982 13,767 Research scholarships 2,008 10,598 Card shop sponsorship - 8,796 NPS scholarships - 40,000 Seminars and workshops 174,212 72,773 Osteoporosis seminars - 310 Hydrotherapy classes 65,195 62,405 Kidsfl ix income 184,497 121,644 Sponsorship evaluation 180 - Sale of publications 5,261 11,196 Arthritis Matters advertising 2,581 6,652 Other revenue 77,463 30,198 Other income - 307,607 Decrease in accumulated funds 572,437 171,321

1,859,080 1,994,432 19 Results of fundraising appeals (continued)(iv) Comparisons of certain monetary fi gures and percentages

2011 2011 2010 2010$ % $ %

Total cost of fundraising / 50,317 34 68,751 52Gross income from fundraising 146,901 130,992 Net surplus from fundraising / 96,584 66 62,241 48Gross income from fundraising 146,901 130,992 Total cost of services / 419,410 23 614,378 29Total expenditure 2,005,981 2,125,424Total costs of services / 469,410 33 614,378 31Total income received 1,412,996 1,954,103

20 Subsequent eventsThere have been no events subsequent to reporting date which would have a material eff ect on the Company's fi nancial statements at 30 June 2011.




Directors’ DeclarationIn the opinion of the directors of Arthritis Foundation of New South Wales (the Company):

(a) the fi nancial statements and notes, set out on pages 6 to 22, are in accordance with the Corporations Act 2001, including:

(i) giving a true and fair view of the Company’s fi nancial position as at 30 June 2011 and of its performance for the fi nancial year ended on that date; and

(ii) complying with Australian Accounting Standards - Reduced Disclosure Requirements and the Corporations Regulations 2001; and

(b) there are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and payable.

Signed in accordance with a resolution of directors.

Mr D RichesDirector

Mr D MessnerDirector

Dated at Sydney this 19th day of October 2011.

Mr D RichesDirector

MrMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMMM DDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD MessnerDiDiDiDDDiDDDiDiDDDDDDDiDiDiDDDDDiDDDDDDDiDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDDD rector



Independent audit report to the members of Arthritis Foundation of New South Wales

Report on the fi nancial reportWe have audited the accompanying fi nancial report of Arthritis Foundation of New South Wales (the Company), which comprises the statement of fi nancial position as at 30 June 2011, the statement of comprehensive income, statement of changes in members’ funds and statement of cash fl ows for the year then ended, notes 1 to 20 comprising a summary of signifi cant accounting policies and other explanatory information, and the directors’ declaration.

Directors’ responsibility for the fi nancial report

The directors of the Company are responsible for the preparation of the fi nancial report that gives a true and fair view in accordance with Australian Accounting Standards – Reduced Disclosure Requirements and the Corporations Act 2001, and for such internal control as the directors determine is necessary to enable the preparation of the fi nancial report that is free from material misstatement, whether due to fraud or error.

Auditor’s responsibility

Our responsibility is to express an opinion on the fi nancial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the fi nancial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the fi nancial report. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the fi nancial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation of the fi nancial report that gives a true and fair view in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the eff ectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the directors, as well as evaluating the overall presentation of the fi nancial report.

We performed the procedures to assess whether in all material respects the fi nancial report presents fairly, in accordance with the Corporations Act 2001 and Australian Accounting Standards - Reduced Disclosure Requirements, a true and fair view which is consistent with our understanding of the Company’s fi nancial position and of its performance.



Independent audit report to the members of Arthritis Foundation of New South Wales (continued)In addition, our audit report has also been prepared for the members of the Company in accordance with Section 24(2) of the Charitable Fundraising (NSW) Act 1991. Accordingly we have performed additional work beyond that which is performed in our capacity as auditors pursuant to the Corporations Act 2001. These additional procedures included obtaining an understanding of the internal control structure for fundraising appeal activities and examination, on a test basis, of evidence supporting compliance with the accounting and associated record keeping requirements for fundraising appeal activities pursuant to the Charitable Fundraising (NSW) Act 1991 and Regulations.

It should be noted that the accounting records and data relied upon for reporting on fundraising appeal activities are not continuously audited and do not necessarily refl ect after the event accounting adjustments and the normal year end fi nancial adjustments for such matters as accruals, prepayments, provisioning and valuations necessary for year end fi nancial report preparation.

We believe that the audit evidence we have obtained is suffi cient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Corporations Act 2001. We confi rm that the independence declaration required by the Corporations Act 2001, provided to the directors of Arthritis Foundation of New South Wales on 19 October 2011, would be in the same terms if given to the directors as at the time of this auditor’s report.

Basis for qualifi ed auditor’s opinion

Fundraising and bequest income amounting to $570,756 are a signifi cant source of revenue for Arthritis Foundation of New South Wales. Arthritis Foundation of New South Wales has determined that it is impracticable to establish controls over the collection of fundraising and bequest income prior to entry into its fi nancial records. Accordingly, as the evidence available to us regarding revenue from this source was limited, our audit procedures with respect to fundraising and bequest income had to be restricted to the amounts recorded in the fi nancial records. We therefore are unable to express an opinion whether the fundraising and bequest income of Arthritis Foundation of New South Wales obtained is complete.

In respect of the qualifi cation however, based on our understanding of the internal controls, nothing has come to our attention which would cause us to believe that the internal controls over revenue from fundraising appeal activities and bequest income by the Company are not appropriate given the size and nature of the Company.



Qualifi ed auditor’s opinion pursuant to the Corporations Act 2001

In our opinion, except for possible eff ects of the matter described in the Basis for qualifi ed opinion paragraph, the fi nancial report of Arthritis Foundation of New South Wales is in accordance with the Corporations Act 2001, including:

(i) giving a true and fair view of the Company’s fi nancial position as at 30 June 2011 and of its performance for the year ended on that date; and

(ii) “complying with Australian Accounting Standards - Reduced Disclosure Requirements and the Corporations Regulations 2001.

Qualifi ed audit opinion pursuant to the Charitable Fundraising (NSW) Act 1991

In our opinion, except for the possible eff ects of the matter described in the Basis for qualifi ed opinion paragraph:

a) the fi nancial report gives a true and fair view of the fi nancial result of fundraising appeal activities for the fi nancial year ended 30 June 2011;

b) the fi nancial report has been properly drawn up, and the associated records have been properly kept for the period from 1 July 2010 to 30 June 2011, in accordance with the Charitable Fundraising (NSW) Act 1991 and Regulations;

c) money received as a result of fundraising appeal activities conducted during the period from 1 July 2010 to 30 June 2011, has been properly accounted for and applied in accordance with the Charitable Fundraising (NSW) Act 1991 and Regulations; and

d) there are reasonable grounds to believe that Arthritis Foundation of New South Wales will be able to pay its debts as and when they fall due.

Carlo PasqualiniPartnerSydney25 October 2011




Declaration by Chief Executive Offi cer in respect of fundraising appealsI, Karen Filocamo, Chief Executive Offi cer of Arthritis Foundation of New South Wales, declare in my opinion:

(a) The fi nancial report gives a true and fair view of all income and expenditure of Arthritis Foundation of New South Wales with respect to fundraising appeal activities for the fi nancial year ended 30 June 2011;

(b) the statement of fi nancial position gives a true and fair view of the state of aff airs with respect to fundraising activities as at 30 June 2011;

(c) the provisions of the Charitable Fundraising (NSW) Act 1991 and Regulations and the conditions attached to the authority have been complied with for the fi nancial year ended 30 June 2011; and

(d) the internal controls exercised by Arthritis Foundation of New South Wales are appropriate and eff ective in accounting for all income received. It is not always practicable for Arthritis Foundation of New South Wales to establish accounting control over all sources of fundraising activities prior to the receipt of the funds by employees of the Company.

Karen FilocamoChief Executive Offi cer

Sydney, 19 October 2011


YOUNG OR OLD, MALE OR FEMALE CITY OR RURAL…

YOU DON’T HAVE TO LIVE WITH THE PAIN ALONE.

ARTHRITIS NSW Locked Bag 2216, North Ryde NSW 1670Phone: 02 9857 3300Fax: 02 9857 3399Toll Free: 1800 011 041arthritisnsw.org.auAuthority to fundraise CFN 12845 ACN 000 587 299 ABN 64 528 634 894

arthritis nsw annual report 2011

Documents

arthritis nsw

juvenile arthritis

challenging arthritis

rheumatoid arthritis

university of nsw

good work

directors report

year break