Governance Statement ...................................................... 1
Company Profile ................................................................. 2
Directors’ Report ............................................................... 3
Directors’ Declaration ........................................................ 5
Independent Auditor’s Report ........................................... 6
Lead Auditor’s Independence
Declaration......................................................................... 9
Annotated Statement of Financial
Performance .................................................................... 10
Consolidated Statement of Profit
and Loss ........................................................................... 11
Consolidated Balance Sheet ............................................ 12
Statement of Cash Flows ................................................. 13
Statement of Changes in Equity ...................................... 14
Notes to the Consolidated Financial
Statements ....................................................................... 15
Appendix .......................................................................... 40
Cover: Image credit:
In My Blood It Runs
– Closer Productions. Photo: Maya Newell
CONTENTS
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 1
1. GENERAL STATEMENT
1.1 Screenrights is dedicated to maximising the
incentive provided by the copyright system for
the production of audiovisual works. Specifically
Screenrights aims to:
• maximise returns to audiovisual rightsholders
through collective management of rights; and
• encourage access to our members’ content in
return for fair fees.
1.2 In furtherance of these goals, Screenrights seeks
to maintain and foster principles of corporate
governance that accord with best practice and
are appropriate for a declared collecting society,
requiring the highest standards of behaviour and
accountability.
1.3 It is recognised that it is neither possible nor
desirable to lay down prescriptive rules to
dictate actions in the varied circumstances
that may confront an organisation in its future.
Nonetheless the Board of Directors of Screenrights
acknowledges the general statements concerning
governance, ethics and the obligations of Directors
in this paper and adopts this policy, and will review
it as necessary.
1.4 The aim of the Screenrights Board of Directors is
stewardship that is effective, accountable and fair.
2. GOVERNANCE FOR WHOM?
2.1 The Board comprises individuals elected by the
members of Screenrights. It has collective
legal responsibility for directing the affairs of
Screenrights for the benefit of the members
[present and future], recognising the interests of
other stakeholders, notably the public [directly
and through the office of the Minister for
Communications and the Arts], the statutory and
voluntary licensees, employees and other parties
with whom Screenrights interacts.
2.2 In a more general sense, Directors of all
companies have a role in economic and social
development through effective management of
resources in the national and global interest.
Screenrights Directors recognise a direct
responsibility to rightsholders but also a
partnership with copyright users and with the
Federal Government.
2.3 The Board [and Screenrights] stand in a fiduciary
relationship to relevant rightsholders who are
members. Although the interests of members are
paramount, the interests of groups other than the
membership are important and the Board seek
solutions that benefit all parties, where possible.
2.4 There are no nominees or Directors
representing a constituency within the
membership. Some Directors are associated
with member organisations and/or have
knowledge of the views of member groups.
It is desirable and proper for Directors to present
the views of individual members or member
groups to the Board. It is neither desirable nor
proper for Directors to act in the interests of
individual members, member groups or groups
that may have supported their election to the
Board. Directors acknowledge their legal duty to
act in the best interests of Screenrights.
GOVERNANCE STATEMENT
Extract from Screenrights' Corporate Governance Statement which was reviewed by
Screenrights’ Board of Directors on 29 May 2019 and published following the outcome of
the Extraordinary General Meeting of 25 July 2019.
Full Statement available at: https://www.screenrights.org/wp-content/uploads/2019/08/
2019-08-05-Corporate-Governance-Statement.pdf
2
OFFICE OF THE CHIEF EXECUTIVE
Chief Executive: James Dickinson
NEW BUSINESS & TECHNOLOGY
Head of New Business & Technology:
Emma Madison
Development Project Manager:
Luke Asprey
Lead, Application Development:
Brian Chambers
Business Analyst/Programmer:
Daniel McCosker*
Senior Analyst Programmer:
Sandyha [Sandra] Bhalla
Disbursement Service Manager:
Jasmina Matic*/ Madeleine Donovan*
MEMBER SERVICES
Head of Member Services: Maha Ismail*
Member Relations Manager: Annabel Holt
Distribution Manager: Sean Price
International Service Manager:
Gaëlle Clark
Senior Portfolio Coordinator:
John Alexander
Senior Distribution Officer: Kate Bowley*
Senior Research Officer: Clare Macken*
Senior Registration Officer: Ian Laird
Registration Data Administrator:
Hayley Colley
Portfolio Coordinator: Tova Bor wein
Portfolio Coordinator: Mariana Corbellini
Portfolio Coordinator: Kaaran Watene
Distribution Officer: Wade Clarke*
ENHANCETV TEAM
Head of EnhanceTV: Andrew Mula
Content & Catalogue Editor: Paul Stock
Curriculum Content Producers:
Duha Samin / Penelope Christie*
Director, Customer Success: Chris Singh
Customer and Data Manager:
Jonathan Zhang
Stack Developer: Alex Corzo
Full Stack Developer: Viral Jetani
Content Producer/Copywriter:
Sophie Curren
PHP Developer: Prakash Chhetri
MARKETING
Marketing Manager: Sarah Steel*
BUSINESS & OPERATIONS
Chief Operating Officer/Company
Secretary: Susan Casali
Accountant & Internal Auditor:
Angela Cheung
Network & Infrastructure Manager:
Justin Franks
User & Systems Support: Daniel Read
Executive Assistant/Office Manager:
Kylie Cooke
Office Administrator: Belle Darcy
Administrative Assistant:
Wendy Lee-Lusher*
LICENSING
Head of Licensing: Scott James
Data & Systems Manager: Nick Grodzicki
Licensing/Registrations Officer:
Mary Luque*
LEGAL
General Counsel: Natalie Buck*
Associate Counsel: Kaitie Andrews
* Indicates part-time employee/consultant
Full time equivalent = 41.03
DIRECTORS & OFFICERS
Kim Dalton OAM
Chair
Georgina Waite
Deputy Chair
DIRECTORS
Geoffrey Atherden AM
Jonathan Carter
Anne Chesher
John Ford
Christopher Gardoll
Ben Grant
Kelly Lefever
Cathy Service
Victoria Spackman ONZM
AUDITORS
KPMG
BANKERS
National Australia Bank
Westpac
Bank of New Zealand
SOLICITORS
Banki Haddock Fiora
Harmers Workplace
Lawyers
McCabe Curwood Solicitors
Emery Legal
Sainty Law
Sparke Helmore
Gilbert & Tobin
Cole Media & Entertainment
Law
Audio-Visual Copyright Society Limited trading as Screenrights ABN 76 003 912 310
Registered office: Level 1, 140 Myrtle Street Chippendale NSW 2008
Phone: +61 2 8038 1300 www.screenrights.org
COMPANY PROFILE
As at 30 June 2020
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 3
LARISSA BEHRENDT
– Director from 2017 to October 2019.
JILL BRYANT
– Director from 2003 and former Chair 2006 to November 2019
SUSAN CASALI –
Chief Operating Officer and Company Secretary
DIRECTORS’ REPORT
GEOFFREY ATHERDEN AM –
Writer and former president of both the Australian Writers’ Guild and Australian Writers’ Foundation.
Geoffrey is well known for his multi award winning television programs including
Mother and Son, BabaKiueria
and
Grass Roots
. Geoffrey has also
served two terms on the board of Screen NSW, and in 2009 received an Order of Australia. Director since 2016.
JONATHAN CARTER –
Head of the Legal, Corporate Services Group, APRA AMCOS Legal Committee, International Confederation of
Societies of Authors and Composers; Steering Committee, Music Rights Australia; and Ethics Committee, Genea Limited. Director since 2017.
ANNE CHESHER –
Education consultant with PhD thesis “
Television Content in the 21st Century Classroom
”. Over 20 years experience
producing online education creative media for the television industry [clients include ABC, SBS, Foxtel, National Geographic Channel]. Former
secondary school teacher and writer of ATOM study guides. Director since 2014.
KIM DALTON OAM –
Producer, distributor and broadcaster with over 40 years’ experience as a senior executive in the screen industry.
Former CEO, Australian Film Commission; former Director, ABC Television; former Chair, Freeview Australia; Chair, Asian Animation Summit
and recipient of Order of Australia medal for service to the Australian film and television industry. Director since 2015.
JOHN [JACK] FORD BA, LLB GAICD –
Media consultant, company director and lawyer practising in the media industry for over 30 years.
Clients include Telstra Corporation, TVI/Sci-Fi and TVN Channel. Director, Sydney Children’s Hospital Network, as well as Chair of the Network’s
Capital Works Committee. Director since 1997.
CHRISTOPHER GARDOLL –
Over 45 years’ experience in professional accounting and business as a senior executive. Formerly an audit
partner with KPMG specialising in consumer products, distribution and copyright. Previous roles included CFO and Company Secretary with publicly
listed company API, CFO with APRA|AMCOS and COO with Screenrights. Director since 2020.
BEN GRANT –
Managing Director of Goalpost Pictures, with credits spanning three decades of successful content for both cinema and television,
including the 2020 worldwide number one movie
The Invisible Man
. Member of the Film Certification Advisory Board. Member of the Australian
Institute of Company Directors. Member of the Sydney Swans Ambassador Program. Director since 2013. Former Deputy Chair 2016 to 2019.
KELLY LEFEVER –
Kelly is co-creator of the critically acclaimed series
The Circuit
and her credits include
The Doctor Blake Mysteries,
The Code, Miss Fisher’s Murder Mysteries, The Black Balloon
and
The Merger
. She currently sits on the Film Victoria Board. Director since 2018.
CATHY SERVICE –
Chief Operating Officer with KJA Engaging Solutions from February 2013 to June 2018 and then Associate Consultant until
December 2018. Former Head of Finance with BBC Worldwide Australasia. Over 20 years experience in the media industry. Director since 2011.
VICTORIA SPACKMAN ONZM–
Co-owner of the Gibson Group, Board member of Education New Zealand and previous Board member of
SPADA [the NZ Screen Production and Development Association]. Director since 2011.
GEORGINA WAITE –
Head of Content Business at the ABC, with over 25 years experience as Head of Business Affairs and within the ABC Legal
department. Starting out as an Intellectual Property lawyer with Corrs Chambers Westgarth and then the Arts Law Centre. Georgina is also former
lecturer in Media Law at UTS. Director since 2018. Elected Deputy Chair 2019.
4
DIRECTORS’ REPORT [CONTINUED]
LEAD AUDITOR’S INDEPENDENCE DECLARATION
A copy of the Lead Auditor’s Independence Declaration, as
required under Section 307C of the Corporations Act 2001,
is included at page 9 of the Annual Report.
PRINCIPAL ACTIVITIES
The principal activity of the Company during the course of
the financial year was utilisation of its right as a declared
collecting society under s119, s183 and Part VC of the
Copyright Act, to collect monies from copyright users, for
distribution to copyright owners.
REVIEW AND RESULTS OF OPERATIONS
The amount of $45.8 million [2019: $43.5 million] was
determined to form the Distributable Amount available for
distribution to relevant rightsholders from monies collected
for the accounting year ended 30 June 2020.
The net operating profit/[loss] after income tax for the year
was $Nil [2019: $Nil].
STATE OF AFFAIRS
In the opinion of the Directors there were no significant
changes in the state of affairs of the Company or
consolidated entity that occurred during the financial year
under review.
ENVIRONMENTAL REGULATION
The Company’s operations are not subject to any significant
environmental regulations under either Commonwealth or State
legislation. The Board believes that the Company has adequate
systems in place for the management of its environmental
requirements and is not aware of any breach of those
environmental requirements as they apply to the Company.
EVENTS SUBSEQUENT TO BALANCE DATE
On 22 July 2020, Screenrights filed in the Copyright Tribunal
for a determination of equitable remuneration with Foxtel.
There has not arisen in the interval between the end of the
financial year and the date of this report, any other item,
transaction or event of a material and unusual nature that
is likely, in the opinion of the Directors, to affect significantly
the operations of the consolidated entity, the results of those
operations or the state of affairs of the consolidated entity in
future financial years.
LIKELY DEVELOPMENTS
The Company will continue its current activities.
Potential new revenue streams in development include
new forms of retransmission and educational copying by
training providers.
INDEMNIFICATION AND INSURANCE OF OFFICERS
During the year, the Company paid a premium of $12,922 in
respect of a contract of insurance indemnifying those
persons who are or have been officers of the Company
against liabilities that may arise from their position as
officers, except where the liability arises out of conduct
involving a lack of good faith. That insurance policy does not
contain details of the premiums paid in respect of individual
officers of the Company.
MEMBERS’ LIABILITY
The Company is a company limited by guarantee. The
guarantee in the event of the winding up of the Company
is $10 for each member. At 30 June 2020, membership of
the Company comprised 4,709 full members [2019: 4,438],
resulting in a total liability of $47,090 [2019: $44,380].
Dated at Sydney this 23 September 2020 and signed in
accordance with a resolution of the Directors:
Kim Dalton OAM
Chair
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 5
DIRECTORS’ REPORT [CONTINUED]
DIRECTORS’ MEETINGS
The number of Directors’ meetings [including meetings of Committees of Directors] and number of meetings attended by
each of the Directors of the Company during the financial year are:
DIRECTOR DIRECTORS’ MEETINGS
AUDIT & RISK
COMMITTEE MEETINGS
REMUNERATION
COMMITTEE MEETINGS
A B A B A B
G Atherden 6 6 N/A N/A N/A N/A
L Behrendt 0 2 N/A N/A N/A N/A
J Bryant 3 3 1 1 1 1
J Carter 6 6 N/A N/A 2 2
A Chesher 6 6 N/A N/A N/A N/A
K Dalton 6 6 2 3 1 1
J Ford 5 6 N/A N/A N/A N/A
B Grant 6 6 2 3 1 1
K Lefever 5 6 N/A N/A N/A N/A
C Service 6 6 3 3 2 2
V Spackman 6 6 N/A N/A N/A N/A
G Waite 5 6 N/A N/A 1 1
A Number of meetings attended
B Number of meetings held during the time the Director held office during the year
N/A Director not a member of that Committee
DIRECTORS’ DECLARATION
In the opinion of the Directors of Audio-Visual Copyright Society Limited:
[a] The consolidated financial statements and notes, set out on pages11 to 39, are in accordance with the
Corporations Act 2001
, including:
[i] giving a true and fair view of the financial position of the consolidated entity as at 30 June 2020
and of its performance for the financial year ended on that date, and
[ii] complying with
Australian Accounting Standards
and the
Corporations Regulations 2001
.
[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.
Dated at Sydney this 23 September 2020 and signed in accordance with a resolution of the Directors:
Kim Dalton OAM
Chair
6
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 7
8
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 9
10
ANNOTATED STATEMENT OF FINANCIAL
PERFORMANCE FOR THE YEAR ENDED
30 JUNE 2020
Royalty collections for the
year from Australian schools,
TAFE colleges, universities,
retransmission income, New
Zealand educational institutions,
overseas, and revenue from
services including Enhance TV
and DASA.
Includes interest.
The cost of running
Screenrights, including
employee expenses,
depreciation and other
ordinary expenses.
Screenrights can hold
allocations in trust for a
maximum of six years while
trying to locate relevant
rightsholders. Under the
Attorney-General’s Guidelines,
these funds are then added
to the Distributable Amount
in the current year. For 2014,
expired trust funds scheme
were, by amount and percentage
of Distributable Amount,
AES $426,000 [1.2%],
ARS $340,000 [3.8%],
AGS $29,000 [1.9%] and
NZES $78,000 [4.5%].
We know that not everyone wants to analyse financial statements, so below is our annual summary of the most important
information in these accounts. The notes show the calculations which determine how much money is available to distribute to
rightsholders from the royalties collected and interest received, and after the deduction of tax and expenses.
NON-IFRS FINANCIAL MEASURES
The annotated statement of financial position includes certain non-IFRS financial measures. The directors believe the
presentation of non-IFRS financial measures is useful for the users of this document as they reflect the amounts available for
distribution to rightsholders after the addition of expired trust funds and the transfer of surplus reserves. The below non-IFRS
financial measures have not been subject to review or audit.
Consolidated
2020 2019
$000s $000s
Revenue from Ordinary Activities:
Gross Revenue 52,472 49,906
Other Revenues 1,293 1,670
Expenses [8,822] [8,655]
44,943 42,921
Transfer [to]/from retained
earnings and reserves — —
Amount available for Distribution 44,943 42,921
Add Expired Trust Funds [2013] —
579
Add Expired Trust Funds [2014] 873 —
Total amount available for Distribution 45,816 43,500
Amount transferred to Statutory
Distributable Pools:
Australian Education Service [AES] [28,490] [27,819]
Australian Retransmission Service [ARS] [6,920] [7,867]
Australian Government Copying Service [AGS] [1,003] [1,497]
Amount transferred to Non-Statutory
Distributable Pools:
NZ Education Service [NZES] [2,080] [1,978]
Disbursements by Screenrights [DASA] [5,401] [2,940]
International Service [INT] [1,922] [1,399]
Total amount transferred to
distribution pools [45,816] [43,500]
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 11
The Statement of Profit or Loss and Other Comprehensive Income is to be read in conjunction with the
notes to the Consolidated Financial Statements set out on pages 15 to 39.
For the year ended 30 June 2020
CONSOLIDATED STATEMENT OF PROFIT OR
LOSS AND OTHER COMPREHENSIVE INCOME
Note 2020 2019
$000s $000s
Revenue from rendering of services 2 52,472 49,906
Other income 3 1,293 1,670
Total revenue and other income 53,765 51,576
Employee expenses 4 [5,566] [4,878]
Depreciation and amortisation expense [908] [574]
Operating expense [1,682] [2,315]
Licensing expense [60] [117]
Travel expense [64] [105]
Marketing expense [245] [241]
Legal expense [114] [89]
Other expenses 5 [143] [336]
Total operating expenses [8,782] [8,655]
Interest expense 2 [40] —
Total interest expense [40] —
Royalties paid and payable to members and
affiliated societies 2 [44,943] [42,921]
Net profit before income tax
— —
Income tax expense 7 — —
Net operating profit after income tax
— —
Other comprehensive income — —
Total comprehensive profit
— —
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
12
For the year ended 30 June 2020
CONSOLIDATED BALANCE SHEET
Note
2020 2019
$000s $000s
Current assets
Cash and cash equivalents
8
3,213 3,321
Cash on deposit
8
64,809 60,687
Trade and other receivables
9
4,703 9,480
Total current assets
72,725 73,488
Non-current assets
Property, plant and equipment
10
308 344
Intangibles
11
1,258 1,711
Right-of-use assets
14
928 —
Total non-current assets
2,494 2,055
Total assets
75,219 75,543
Current liabilities
Trade and other payables
12
698 667
Royalties in advance 15,125 14,971
Employee benefits
13
575 505
Loans and borrowings
14
324 —
Other 15 54,674 55,970
Total current liabilities
71,396 72,113
Non-current liabilities
Employee benefits
13
163 167
Loans and borrowings
14
636 —
Other
15
1,394 1,646
Provisions
16
93 80
Total non-current liabilities
2,286 1,893
Total liabilities
73,682 74,006
Net assets
1,537 1,537
Equity
Retained earnings 17 1,337 1,337
Reserves 17 200 200
Total equity
1,537 1,537
The Balance Sheet is to be read in conjunction with the
notes to the Consolidated Financial Statements set out on pages 15 to 39.
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 13
For the year ended 30 June 2020
STATEMENT OF CASH FLOWS
The Statement of Cash Flows is to be read in conjunction with the
notes to the Consolidated Financial Statements set out on pages 15 to 39.
Note 2020 2019
$000s $000s
Cash flows from operating activities
Cash receipts in the course of operations 57,556 44,749
Cash payments in the course of operations [54,542] [48,989]
Net cash from/[used in] operating activities 19[b] 3,014 [4,240]
Cash flows from investing activities
Interest received/receivable 1,427 1,699
Payments for property, plant and equipment [87] [64]
Payments for intangibles — [437]
[Increase]/decrease in cash on deposit [4,122] 3,065
Net cash [used in]/from investing activities [2,782] 4,263
Cash flows from financing activities
Payments for lease liabilities [340] —
Net cash [used in]/from financing activities [340] —
Net [decrease]/increase in cash held
[108] 22
Cash at the beginning of the financial year 3,321 3,299
Cash at the end of the financial year 19[a] 3,213 3,321
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
14
For the year ended 30 June 2020
STATEMENT OF CHANGES IN EQUITY
The Statement of Changes in Equity is to be read in conjunction with the
notes to the Consolidated Financial Statements set out on pages 15 to 39.
Reconciliation of movements in capital and reserves attributable to members
Society
Reserve Fund
Retained
Earnings
Total
Equity
$000s $000s $000s
Balance at 1 July 2018 200 1,337 1,537
Total comprehensive profit — — —
Transfer between retained earnings
and reserves
— — —
Balance at 30 June 2019 200 1,337 1,537
Balance at 1 July 2019 200 1,337 1,537
Impact of change in accounting policy — — —
Adjusted Balance at 1 July 2019 200 1,337 1,537
Total comprehensive profit — — —
Transfer between retained earnings
and reserves — — —
Balance at 30 June 2020 200 1,337 1,537
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 15
1. SIGNIFICANT ACCOUNTING POLICIES
Audio-Visual Copyright Society Ltd trading as Screenrights
[the ‘Company’] is a not for profit company domiciled in Australia.
The consolidated financial report of the Company for the
financial year ended 30 June 2020 comprises the Company and
its subsidiary [together referred to as the ‘consolidated entity’].
The financial report was authorised for issue by the Directors on
23 September 2020.
[a] Principal activities
The principal activities of the Company during the course of
the financial year were utilisation of its right as a declared
collecting society under s119, s183 and Part VC of the Copyright
Act, to collect money from educational institutions, government
departments and agencies and retransmitters for distribution to
relevant copyright owners.
[b] Statement of compliance and basis of preparation
The financial report is a general purpose financial report which
has been prepared in accordance with Australian Accounting
Standards [‘AASBs’] adopted by the Australian Accounting
Standards Board [‘AASB’] and the Corporations Act 2001. The
financial report of the consolidated entity also complies with
International Financial Reporting Standards [IFRSs] adopted by
the International Accounting Standards Board.
The financial report is prepared in Australian dollars, which
is the Company’s functional currency. The Company is of a
kind referred to in ASIC Corporations [Rounding in Financial /
Directors’ Report] Instrument 2016/191 dated 24 March 2016
and in accordance with that Instrument amounts in the financial
report and Directors’ report have been rounded off to the nearest
one thousand dollars, unless otherwise stated.
The financial report is prepared on the historical cost basis.
The preparation of a financial report in conformity with
Australian Accounting Standards requires management to
make judgements, estimates and assumptions that affect the
application of policies and reported amounts of assets and
liabilities, income and expenses. The estimates and associated
assumptions are based on historical experience and various
other factors that are believed to be reasonable under the
circumstances, the results of which form the basis of making the
judgements about carrying values of assets and liabilities that
are not readily apparent from other sources. Actual results may
differ from these estimates.
These accounting policies have been consistently applied by each
entity in the consolidated entity.
[c] Basis of consolidation
[i] Subsidiaries
Subsidiaries are entities controlled by the Company. Control
exists when the Company is exposed to, or has rights to,
variable returns from its involvement with the entity and has the
ability to affect those returns through its power over the entity.
The financial statements of subsidiaries are included in the
consolidated financial statements from the date that control
commences until the date that control ceases.
[ii] Transactions eliminated on consolidation
Intra-group balances and any unrealised gains and losses or
income and expenses arising from transactions within the
consolidated entity are eliminated in preparing the consolidated
financial statements.
[d] Foreign currency transactions
Transactions in foreign currencies are translated at the foreign
exchange rate ruling at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies at the
balance date are translated to Australian dollars at the foreign
exchange rate ruling at that date. Foreign exchange differences
arising on translation are recognised in profit or loss. Non-
monetary assets and liabilities that are measured in terms of
historical cost in a foreign currency are translated using the
exchange rate at the date of the transaction.
[e] Derivatives
The consolidated entity is exposed to changes in interest rates
and foreign exchange balances. The consolidated entity does not
use derivative financial instruments to hedge these risks.
[f] Property, plant and equipment
[i] Owned assets
Items of property, plant and equipment are stated at cost or
deemed cost less accumulated depreciation [see f[ii]] and
impairment losses [see accounting policy j].
[ii] Depreciation
With the exception of freehold land, depreciation is charged to
profit or loss on a straight-line basis over the estimated useful
life of each part of an item of property, plant or equipment. Land
is not depreciated. The estimated useful lives in the current and
comparative periods are as follows:
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
16
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
[ii] Depreciation continued
• Plant and equipment – 3-10 years;
• Computer hardware/Laptops – 3 years;
The residual value, the useful life and the depreciation method
applied to an asset are reassessed at least annually.
[iii] Leased assets
The consolidated entity has applied AASB 16 using the
modified retrospective approach and therefore the comparative
information has not been restated and continues to be reported
under AASB 117 and AASB Interpretation 4. The details of
accounting policies under AASB 117 and AASB Interpretation 4
are disclosed separately if they are different from those under
AASB 16 and the impact of changes is disclosed in Note 1[r].
Policy applicable from 1 July 2019
At inception of a contract, the consolidated entity assesses
whether a contract is, or contains, a lease. A contract is, or
contains, a lease if the contract conveys the right to control the
use of an identified asset for a period of time in exchange for
consideration. To assess whether a contract conveys the right
to control the use of an identified asset, the consolidated entity
assesses whether:
• the contract involves the use of an identified asset – this may
be specified explicitly or implicitly, and should be physically
distinct or represent substantially all of the capacity of a
physically distinct asset. If the supplier has a substantive
substitution right, then the asset is not identified;
• the consolidated entity has the right to obtain substantially all
of the economic benefits from use of the asset throughout the
period of use; and
• the consolidated entity has the right to direct the use of the
asset. The consolidated entity has this right when it has the
decision-making rights that are most relevant to changing how
and for what purpose the asset is used. In rare cases where
the decision about how and for what purpose the asset is used
is predetermined, the consolidated entity has the right to direct
the use of the asset if either:
• the consolidated entity has the right to operate the asset;
or
• the consolidated entity designed the asset in a way that
predetermines how and for what purpose it will be used.
This policy is applied to contracts entered into, or changed, on or
after 1 July 2019.
At inception or on reassessment of a contract that contains
a lease component, the consolidated entity allocates the
consideration in the contract to each lease component on the
basis of their relative stand-alone prices. However, for the
leases of land and buildings in which it is a lessee, the
consolidated entity has elected not to separate non-lease
components and account for the lease and non-lease
components as a single lease component.
The consolidated entity recognises a right-of-use asset and a
lease liability at the lease commencement date. The right-of-use
asset is initially measured at cost, which comprises the initial
amount of the lease liability adjusted for any lease payments
made at or before the commencement date, plus any initial
direct costs incurred and an estimate of costs to dismantle and
remove the underlying asset or to restore the underlying asset or
the site on which it is located, less any lease incentives received.
The right-of-use asset is subsequently depreciated using the
straight-line method from the commencement date to the
earlier of the end of the useful life of the right-of-use asset or
the end of the lease term. The estimated useful lives of right-
of-use assets are determined on the same basis as those of
property and equipment.
In addition, the right-of-use asset is periodically reduced
by impairment losses, if any, and adjusted for certain
remeasurements of the lease liability.
The lease liability is initially measured at the present value of
the lease payments that are not paid at the commencement
date, discounted using the interest rate implicit in the lease or, if
that rate cannot be readily determined, the consolidated entity’s
incremental borrowing rate. Generally, the consolidated entity
uses its incremental borrowing rate as the discount rate.
Lease payments included in the measurement of the lease
liability comprise the following:
• fixed payments, including in-substance fixed payments;
• variable lease payments that depend on an index or a
rate, initially measured using the index or rate as at the
commencement date;
• amounts expected to be payable under a residual value
guarantee; and
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 17
1. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
[iii] Leased assets continued
• the exercise price under a purchase option that the
consolidated entity is reasonably certain to exercise, lease
payments in an optional renewal period if the consolidated
entity is reasonably certain to exercise an extension option,
and penalties for early termination of a lease unless the
consolidated entity is reasonably certain not to terminate early.
The lease liability is measured at amortised cost using the
effective interest method. It is remeasured when there is a
change in future lease payments arising from a change in an
index or rate, if there is a change in the consolidated entity’s
estimate of the amount expected to be payable under a residual
value guarantee, or if the consolidated entity changes its
assessment of whether it will exercise a purchase, extension or
termination option.
When the lease liability is remeasured in this way, a
corresponding adjustment is made to the carrying amount of the
right-of-use asset, or is recorded in profit or loss if the carrying
amount of the right-of-use asset has been reduced to zero.
Short-term leases and leases of low-value assets
The consolidated entity has elected not to recognise right-of-
use assets and lease liabilities for short-term leases of plant
and equipment that have a lease term of 12 months or less
and leases of low-value assets, including IT equipment. The
consolidated entity recognises the lease payments associated
with these leases as an expense on a straight-line basis over the
lease term.
Under AASB 117
In the comparative period, as a lessee the consolidated entity
classified leases that transfer substantially all of the risks and
rewards of ownership as finance leases. When this was the
case, the leased assets were measured initially at an amount
equal to the lower of their fair value and the present value of the
minimum lease payments.
Minimum lease payments were the payments over the lease
term that the lessee was required to make, excluding any
contingent rent.
Subsequently, the assets were accounted for in accordance with
the accounting policy applicable to that asset.
Assets held under other leases were classified as operating
leases and were not recognised in the consolidated entity’s
statement of financial position.
Payments made under operating leases were recognised in
profit or loss on a straight-line basis over the term of the lease.
Lease incentives received were recognised as an integral part of
the total lease expense, over the term of the lease.
[g] Intangible assets
[i] Intangible assets
Intangible assets that are acquired by the consolidated entity
are stated at cost less accumulated amortisation [see g[ii]] and
impairment losses [see accounting policy j].
[ii] Amortisation
Amortisation is charged to profit or loss on a straight-line basis
over the estimated useful lives of intangible assets from the
date they are available for use. The estimated useful lives in the
current and comparative periods are as follows:
• Capitalised software costs – 3-5 years
[h] Trade and other receivables
Trade and other receivables are stated initially at fair value
and then amortised cost less impairment losses [see
accounting policy j].
[i] Cash and cash equivalents
Cash and cash equivalents comprise cash balances, short-term
bills and call deposits.
[j] Impairment
The carrying amounts of the consolidated entity’s assets are
reviewed at each balance sheet date to determine whether
there is any indication of impairment. If any such indication
exists, the asset’s recoverable amount is estimated [see
accounting policy j[i]].
An impairment loss is recognised whenever the carrying amount
of an asset or its cash-generating unit exceeds its recoverable
amount. Impairment losses are recognised in the income
statement, unless an asset has previously been revalued, in
which case the impairment loss is recognised as a reversal to
the extent of that previous revaluation with any excess recognised
through profit or loss.
The Company recognises loss allowance for expected credit
losses [ECL] on financial assets measured at amortised cost.
Loss allowances for trade receivables and contract assets are
always measured at an amount equal to lifetime ECLs.
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
18
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
[j] Impairment continued
Lifetime ECLs are the ECLs that result from all possible default
events over the expected life of a financial instrument.
[i] Calculation of recoverable amount
The recoverable amount of the consolidated entity’s receivables
carried at amortised cost is calculated as the present value of
estimated future cash flows, discounted at the original effective
interest rate [i.e. the effective interest rate computed at initial
recognition of these financial assets]. Receivables with a short
duration are not discounted. Impairment of receivables is not
recognised until objective evidence is available that a loss event
has occurred.
Significant receivables are individually assessed for impairment.
Impairment testing of significant receivables that are not
assessed as impaired individually is performed by placing them
into portfolios of significant receivables with similar risk profiles
and undertaking a collective assessment of impairment.
Non-significant receivables are not individually assessed.
Instead, impairment testing is performed by placing non-
significant receivables in portfolios of similar risk profiles, based
on objective evidence from historical experience adjusted for any
effects of conditions existing at each balance sheet date.
The recoverable amount of other assets is the greater of their
fair value less costs to sell and value in use. In assessing value
in use, the estimated future cash flows are discounted to their
present value using a pre-tax discount rate that reflects current
market assessments of the time value of money and the risks
specific to the asset. For an asset that does not generate largely
independent cash inflows, the recoverable amount is determined
for the cash-generating unit to which the asset belongs.
[ii] Reversals of impairment
Impairment losses are reversed when there is an indication that
the impairment loss may no longer exist and there has been
a change in the estimate used to determine the recoverable
amount. An impairment loss in respect of a receivable carried
at amortised cost is reversed if the subsequent increase in
the recoverable amount can be related objectively to an event
occurring after the impairment loss was recognised. 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.
[k] Employee benefits
[i] Defined contribution superannuation funds
Obligations for contributions to defined contribution
superannuation funds are recognised as an expense in profit or
loss as incurred.
[ii] Long-term service benefits
The consolidated entity’s net obligation in respect of long-term
service benefits is the amount of future benefit that employees
have earned in return for their service in the current and prior
periods. The obligation is calculated using expected future
increases in wage and salary rates, including related on-costs
and expected settlement dates, and is discounted using the
rates attached to the Commonwealth Government bonds at the
balance sheet date which have maturity dates approximating to
the terms of the consolidated entity’s obligations.
[iii] Wages, salaries and annual leave
Liabilities for employee benefits for wages, salaries and annual
leave that are expected to be settled within 12 months of the
reporting date and represent present obligations resulting from
employees’ services provided to reporting date are calculated at
undiscounted amounts based on remuneration wage and salary
rates that the consolidated entity expects to pay as at reporting
date, including related on-costs such as workers compensation
insurance and payroll tax.
[l] Provisions
A provision is recognised in the balance sheet when the
consolidated entity has a present legal or constructive obligation
as a result of a past event and it is probable that an outflow
of economic benefits will be required to settle the obligation.
Provisions are determined by discounting the expected future
cash flows at a pre-tax rate that reflects current market
assessments of the time value of money and, where appropriate,
the risks specific to the liability.
[m] Trade and other payables
Trade and other payables are stated initially at fair value and then
amortised cost. Trade payables are non-interest-bearing and are
normally settled on 60-day terms.
[n] Distributions
The consolidated entity holds the net distributable amount for
each year in trust for rightsholders of the copyright in film and
television programs.
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 19
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
[n] Distributions continued
These rightsholders are eligible to receive the royalties held
on their behalf upon completing necessary documentation,
including a membership agreement and warranty. With respect
to the Statutory Services, the distributable pool is allocated to
all used programs, and actual distributions are made as and
when the required documentation is completed. Until this stage
is reached for a given title, all funds are held in trust for the
rightsholders of the copied program up to a period of four years.
The Board of Directors may decide that special circumstances
exist and continue to hold the pool in trust for a maximum of
two further years. The Board has exercised this discretion for
all relevant distribution periods to date. After that period, the
remaining allocations that have not been distributed are forfeited
and placed into general revenue for inclusion in the current
distribution period in accordance with Guidelines issued by the
Attorney-General. In administering the Statutory Service, the
consolidated entity collects and distributes remuneration payable
by licensees. The Distributable Amount is the total amount
received from licensees for the distribution period [financial year]
together with bank interest after deducting operating expenses,
providing for taxation if applicable and allocating the relevant
portion to the Reserve Fund. Records of usage are collated so
that the total number of minutes for each program title and
episode is ascertained.
Allocations are made to each program according to the number
of minutes used and other factors. Once an allocation per
program by title has been established, a further allocation
is made to the various forms of copyright subsisting in the
programs [e.g. cinematograph films, literary/dramatic works,
artistic works, sound recordings]. Claimants warrant that
they own or control the relevant copyright in one or more of
these components and at the close of the distribution period
are paid accordingly. This same process has been instituted
for the allocation and distribution of royalties for the copying
of programs by educational institutions in New Zealand. This
is so even though the mechanism of conducting the service is
different, with the Company licensing this recording right in New
Zealand on behalf of the rightsholders.
With respect to the international registration and collection
process, the Company simply distributes the royalties it receives
from other audiovisual societies for titles it has registered on
behalf of the rightsholders. The Company follows the allocations
set by the relevant society and only makes an adjustment for
interest and the expenses incurred in providing the service for
its members.
[o] Revenue and other income
Revenues are recognised at fair value of the consideration
received net of the amount of goods and services tax [GST]
payable to the taxation authority.
[i] Revenue from rendering services
Revenue is measured based on the contract with the customer.
Licence fee revenue is recognised over the term of the
agreements, where the fee is equitable remuneration for access
to the licensed materials. Licence fee revenue is recognised
when the licence is granted, where the licence is for use of the
licensed materials.
[ii] Interest income
Interest is generally recognised as it accrues, taking into account
the effective yield on the financial asset.
[iii] Net gain/loss on disposal of property, plant
and equipment
The net gains of non-current asset sales are included as other
income at the date control of the asset passes to the buyer, usually
when an unconditional contract of sale is signed.
The net losses on non-current asset sales are included in other
expenses. The gain or loss on disposal is calculated as the
difference between the carrying amount of the asset at the time
of disposal and the gross proceeds on disposal.
[p] Income tax
The Income Tax Assessment Act 1997, as amended by the Tax
Laws Amendment [2004 Measures No 6] Act 2005, provides the
following for collecting societies:
• Collecting societies will not be taxed on any copyright income
that they collect and hold on behalf of members, pending
allocation to them;
• Non-copyright income derived by collecting societies will not
be taxed [provided that the amount of non-copyright income
derived is within certain limits]; and
• Any copyright and non-copyright income collected or derived
by the collecting society that is exempt from income tax is
included in the assessable income of the members upon
distribution.
20
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
[p] Income tax continued
The amending Act contains definitions of:
[a] Declared collecting society;
[b] Collecting society;
[c] Copyright income, which includes licence fees and interest
received or derived from the copyright income.
Non-copyright income is subject to a de minimis rule.
Non-copyright income of collecting societies will be exempt
from
income tax to the extent that this non-copyright income
does not
exceed the lesser of:
• 5% of the total amount of copyright income and non-copyright
income of the collecting societies for the income year; and
• $5 million or such other amount as is prescribed by
the regulations.
The Society will not be taxed on any copyright income [defined as
ordinary or statutory royalties/licence fees and interest received or
derived by the Society] it collects and holds on behalf of members,
pending allocation to them. Additionally, the Society will not be
taxed on non-copyright income to the extent that this non-
copyright income does not exceed the above specified limitations.
[q] 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
Australian Tax Office [ATO] is included as a current asset or
liability in the balance sheet. Cash flows are included in the
statement of cash flows on a gross basis. The GST components
of cash flows arising from investing and financing activities
which are recoverable from, or payable to, the ATO are classified
as operating cash flows.
[r] New accounting standards adopted during the period
Except for the changes below, the consolidated entity has
consistently applied the accounting policies to all periods
presented in these consolidated financial statements.
•
AASB 15 Revenue from Contracts with Customers
AASB 15 replaced AASB 118 Revenue and AASB 111
Construction Contracts, and became mandatory for not-for-
profit organisations in FY2020. This change has not had a
material impact on the consolidated entity.
•
AASB 16 Leases
AASB 16 replaces AASB 117 Leases and AASB Interpretation
4. The consolidated entity applied AASB 16 with a date of initial
application of 1 July 2019 using the modified retrospective
approach, under which the cumulative effect of initial application
is recognised in retained earnings at 1 July 2019. The details of
the impact of this change in accounting policy is disclosed below.
[i] Definition of a lease
Previously, the consolidated entity determined at contract
inception whether an arrangement is or contains a lease under
AASB Interpretation 4. Under AASB 16, the consolidated entity
assesses whether a contract is or contains a lease based on the
definition of a lease, as explained in Note 1[f] [iii].
On transition to AASB 16, the consolidated entity elected to apply
the practical expedient to grandfather the assessment of which
transactions are leases. It applied AASB 16 only to contracts
that were previously identified as leases. Contracts that were not
identified as leases under AASB 117 and AASB Interpretation 4
were not reassessed for whether there is a lease. Therefore, the
definition of a lease under AASB 16 was applied only to contracts
entered into or changed on or after 1 July 2019.
[ii] As a lessee
As a lessee, the consolidated entity previously classified leases
as operating or finance leases based on its assessment of
whether the lease transferred significantly all of the risks and
rewards incidental to ownership of the underlying asset to the
consolidated entity. Under AASB 16, the consolidated entity
recognises right-of-use assets and lease liabilities for most
leases – i.e. these leases are on-balance sheet.
The consolidated entity decided to apply recognition exemptions
to short-term leases. For leases of other assets, which were
classified as operating under AASB 117, the consolidated entity
recognised right-of-use assets and lease liabilities.
i. Leases classified as operating leases under AASB 117
At transition, lease liabilities were measured at the present value
of the remaining lease payments, discounted at the consolidated
entity’s incremental borrowing rate as at 1 July 2019. Right-
of-use assets are measured at an amount equal to the lease
liability, adjusted by the amount of any prepaid or
accrued lease
payments – the consolidated entity applied this approach to all
other leases.
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 21
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
1. SIGNIFICANT ACCOUNTING POLICIES CONTINUED
[r] New accounting standards adopted during the
period continued
[ii] As a lessee continued
i. Leases classified as operating leases under AASB 117
continued
The consolidated entity used the following practical expedients
when applying AASB 16 to leases previously classified as
operating leases under AASB 117.
• Applied a single discount rate to a portfolio of leases with
similar characteristics.
• Adjusted the right-of-use assets by the amount of AASB 137
onerous contract provision immediately before the date of
initial application, as an alternative to an impairment review.
• Applied the exemption not to recognise right-of-use assets and
liabilities for leases with less than 12 months of lease term.
• Excluded initial direct costs from measuring the right-of-use
asset at the date of initial application.
• Used hindsight when determining the lease term if the
contract contains options to extend or terminate the lease.
[iii] Impacts on financial statements
On transition to AASB 16, the consolidated entity recognised an
additional $1,261,145 of right-of-use assets and $1,261,145 of
lease liabilities, recognising no difference in retained earnings.
When measuring lease liabilities, the consolidated entity
discounted lease payments using its incremental borrowing rate
at 1 July 2019. The rate applied ranged between 3.25-3.6%.
[s] New accounting standards and interpretations not
yet adopted
There are currently no new standards and amendments to
standards which are effective for annual periods beginning after
30 June 2020 that the consolidated entity believes are applicable
in preparing these financial statements.
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
22
2. RECONCILIATION OF INCOME STATEMENT
Note 2020 2019
$000s $000s
Revenue from rendering of services:
– Australian Education Service 33,151 32,018
– Australian Retransmission Service 7,784 9,060
– International Service 2,110 1,486
– Australian Government Copying Service 1,148 1,624
– NZ Education Service 2,531 2,421
– Disbursements by Screenrights 5,401 2,940
– EnhanceTV Resource Centre 347 357
Total revenue 52,472 49,906
Other income 3 1,293 1,670
Total revenue and other income 53,765 51,576
Employee expenses 4 [5,566] [4,878]
Depreciation and amortisation expense [908] [574]
Operating expense [1,682] [2,315]
Licensing expense [60] [117]
Travel expense [64] [105]
Marketing expense [245] [241]
Legal expense
[114] [89]
Other expenses 5 [143] [336]
Total operating expenses [8,782] [8,665]
Interest expense 14 [40] —
Total interest expense [40] —
Net royalties collected and interest received
thereon before income tax 44,943 42,921
Income tax benefit
— —
Net royalties collected and interest received
thereon after income tax
44,943 42,921
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 23
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
2. RECONCILIATION OF INCOME STATEMENT CONTINUED
Note 2020 2019
$000s $000s
Royalties paid and payable:
Add expired statutory trust funds 873 578
Less amount transferred to AES
distributable pool 2019
— [27,819]
Less amount transferred to AES
distributable pool 2020
15 [28,490] —
Less amount transferred to ARS
distributable pool 2019
— [7,867]
Less amount transferred to ARS
distributable pool 2020
15 [6,920] —
Less amount transferred to AGS
distributable pool 2019
— [1,497]
Less amount transferred to AGS
distributable pool 2020
15 [1,003] —
Less amount transferred to NZES
distributable pool 2019
— [1,978]
Less amount transferred to NZES
distributable pool 2020
15 [2,080] —
Disbursements by Screenrights [5,401] [2,939]
International Service [1,922] [1,399]
Net royalties paid and payable
[44,943] [42,921]
Net operating profit
— —
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
24
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
3. OTHER INCOME
2020 2019
$000s $000s
Interest and other income
– AES interest income 859 1,160
– ARS interest income 172 233
– INT interest income 17 64
– AGS interest income 30 39
– NZES interest income 38 40
– ISAN interest income — 1
– DASA interest income and admin fee 177 132
– Other interest income — 1
1,293 1,670
4. EMPLOYEE EXPENSES
Wages and salaries [including director fees] 4,728 3,913
Contributions to defined contribution superannuation funds 435 410
Increase in liabilities for annual and long service leave
93 203
Other employee expenses 310 352
5,566 4,878
5. OTHER EXPENSES
NZES expenses 122 128
Recruitment expenses — 185
ISAN 4 10
Other 17 13
143 336
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 25
6. AUDITOR’S REMUNERATION
2020 2019
$000s $000s
Audit services 62 60
Other Assurance Services 8 8
70 68
7. TAXATION
Audio-Visual Copyright Society Limited was granted tax exempt status effective 1 July 2002. EnhanceTV Pty Ltd
[the Company’s controlled entity] was incorporated on 15 May 2006 and is not tax exempt. In the current financial
year, EnhanceTV Pty Ltd did not make a profit. As a consequence there is no tax expense for the consolidated entity
[2019: $Nil]. As at 30 June 2020, EnhanceTV has carried forward losses of $32,426 [2019: $32,426]. No tax losses
have been recognised as a deferred tax asset.
8. CASH ASSETS
2020 2019
$000s $000s
Cash at bank 3,213 3,321
Cash on deposit 64,809 60,687
68,022 64,008
The interest rate at 30 June 2020 on cash accounts is 0.25% [2019: 0.75%] which is the prevailing interest rate on
cash at bank. The cash on deposit with banks mature within 238 days. The weighted average interest rate at 30 June
2020 on cash on deposit is 1.03% [2019: 2.44%].
9. TRADE AND OTHER RECEIVABLES
2020 2019
$000s $000s
Trade receivables 4,579 6,096
Sundry receivables 124 3,384
4,703 9,480
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
26
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
10. PROPERTY, PLANT & EQUIPMENT
Plant &
equipment Total
$000s $000s
Cost
Balance at 1 July 2018 1,696 1,696
Acquisitions 64 64
Disposals [861] [861]
Balance at 30 June 2019 899 899
Balance at 1 July 2019 899 899
Acquisitions 87 87
Disposals [1] [1]
Balance at 30 June 2020 985 985
Accumulated depreciation
Balance at 1 July 2018 1,296 1,296
Depreciation charge for the year 120 120
Disposals [861] [861]
Balance at 30 June 2019 555 555
Balance at 1 July 2019 555 555
Depreciation charge for the year 122 122
Disposals — —
Balance at 30 June 2020 677 677
Carrying amounts
At 1 July 2019 344 344
At 30 June 2020 308 308
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 27
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
11. INTANGIBLES
Computer
software WIP Total
$000s $000s $000s
Cost
Balance at 1 July 2018 2,779 56 2,835
Acquisitions 299 138 437
Disposals [799] — [799]
Balance at 30 June 2019 2,279 194 2,473
Balance at 1 July 2019 2,279 194 2,473
Acquisitions — — —
Disposals — — —
Balance at 30 June 2020 2,279 194 2,473
Accumulated amortisation
Balance at 1 July 2018 1,107 — 1,107
Amortisation charge for the year 454 — 454
Disposals [799] — [799]
Balance at 30 June 2019 762 — 762
Balance at 1 July 2019 762 — 762
Amortisation charge for the year 453 — 453
Disposals — — —
Balance at 30 June 2020 1,215 — 1,215
Carrying amounts
At 1 July 2019 1,517 194 1,711
At 30 June 2020 1,064 194 1,258
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
28
12. TRADE AND OTHER PAYABLES
2020 2019
$000s $000s
Trade and other creditors 233 391
Accrued expenses 465 276
698 667
13. EMPLOYEE BENEFITS
2020 2019
$000s $000s
Current
Liability for annual leave 268 236
Liability for long service leave 307 269
575 505
Non-current
Liability for long service leave 163 167
163 167
14. LEASES
Office Car Park Printer Total
$000s $000s $000s $000s
[i] Right-of-use assets
Cost
Balance at 1 July 2018 — — — —
Acquisitions — — — —
Disposals — — — —
Balance at 30 June 2019 — — — —
Balance at 1 July 2019 — — — —
Impact of change in accounting policy 1,185 15 61 1,261
Adjusted Balance at 1 July 2019 1,185 15 61 1,261
Acquisitions — — — —
Disposals — — — —
Balance at 30 June 2020 1,185 15 61 1,261
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 29
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
14. LEASES CONTINUED
Office Car Park Printer Total
$000s $000s $000s $000s
[i] Right-of-use assets continued
Accumulated depreciation
Balance at 1 July 2018 — — — —
Acquisitions
— — — —
Disposals — — — —
Balance at 30 June 2019 — — — —
Balance at 1 July 2019
— — — —
Depreciation charge for the year 316 4 13 333
Disposals — — — —
Balance at 30 June 2020 316 4 13 333
Carrying amounts
At 1 July 2019 1,185 15 61 1,261
At 30 June 2020 869 11 48 928
[ii] Loans and borrowings
Lease liabilities in Balance Sheet as at
30 June 2020
Current 307 4 13 324
Non-current 593 7
36 636
900 11
49 960
Maturity analysis as at 30 June 2020
Less than one year 334 5 14 353
One to five years 611 7 38 656
More than five years — — — —
Total undiscounted lease liabilities at
30 June 2020 945 12 52 1,009
[iii] Amounts recognised in Profit/[loss]
Interest on lease liabilities 37 1 2 40
Depreciation expense 316 4 13 333
353 5 15 373
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
30
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
14. LEASES CONTINUED
Office Car Park Printer Total
$000s $000s $000s $000s
[iv] Amounts recognised in Profit/[loss]
Total cash outflow for leases 322 4 14 340
322 4 14 340
15. OTHER LIABILITIES
2020 2019
$000s $000s
Current
Cultural Fund 484 465
Trust – IBNR Fund 989 757
Trust – Artistic Works 748 1,375
Competing Claims Fund 120 74
2,341 2,671
Trust – Statutory
Australian Education Service
2014 Distributable amount payable to copyright owners — 528
2015 Distributable amount payable to copyright owners 440 539
2016 Distributable amount payable to copyright owners 823 1,064
2017 Distributable amount payable to copyright owners 1,375 1,835
2018 Distributable amount payable to copyright owners 2,052 3,785
2019 Distributable amount payable to copyright owners 3,570 27,819
2020 Distributable amount payable to copyright owners 28,490 —
Australian Retransmission Service
2014 Distributable amount payable to copyright owners — 415
2015 Distributable amount payable to copyright owners 258 345
2016 Distributable amount payable to copyright owners 375 501
2017 Distributable amount payable to copyright owners 550 710
2018 Distributable amount payable to copyright owners 802 1,383
2019 Distributable amount payable to copyright owners 1,139 7,867
2020 Distributable amount payable to copyright owners 6,920 —
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 31
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
15. OTHER LIABILITIES CONTINUED
Trust – Statutory continued
2020 2019
$000s $000s
Australian Government Copying Service
2014 Distributable amount payable to copyright owners — 13
2015 Distributable amount payable to copyright owners 12 16
2016 Distributable amount payable to copyright owners 13 14
2017 Distributable amount payable to copyright owners 17 19
2018 Distributable amount payable to copyright owners 36 229
2019 Distributable amount payable to copyright owners 44 1,497
2020 Distributable amount payable to copyright owners 1,003 —
Sound Recordings Distributable amount
30 30
47,949 48,609
Trust – Non-statutory
NZ Education Service
2014 Distributable amount payable to copyright owners — 105
2015 Distributable amount payable to copyright owners 99 125
2016 Distributable amount payable to copyright owners 118 151
2017 Distributable amount payable to copyright owners 193 247
2018 Distributable amount payable to copyright owners 277 417
2019 Distributable amount payable to copyright owners 448 1,978
2020 Distributable amount payable to copyright owners 2,080 —
Disbursements by Screenrights
917 825
International Service
252 842
4,384 4,690
Total other liabilities - current
54,674 55,970
Non-current
Fund for the benefit of members 1,394 1,646
Total other liabilities - non-current
1,394 1,646
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
32
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
16. PROVISIONS
2020 2019
$000s $000s
Lease make good 93 80
93 80
17. EQUITY
Retained earnings
Funds held as part of the Company’s retained earnings will be used for the benefit of all members at the discretion
of the Board.
Reserve fund
In accordance with 15.4[c] of the Articles of Association, the Company is required to establish a reserve fund.
From time to time, the Board will authorise funds to be released from the reserve fund to meet the costs of
abnormal or exceptional expenditure.
18. FINANCIAL RISK MANAGEMENT
[a] Overview
The consolidated entity has exposure to the following risks from the use of financial instruments:
• Credit risk;
• Liquidity risk; and
• Market risk.
This note presents information about the consolidated entity’s exposure to each of the above risks, their objectives, and
the policies and processes for measuring and managing risk. Further quantitative disclosures are included in this note.
The Board of Directors has overall responsibility for the establishment and oversight of the risk management
framework. The Board has established the Audit & Risk Committee, which is responsible for developing and
monitoring risk management policies. The Committee reports regularly to the Board on its activities.
Risk management policies are established to identify and analyse the risks faced by the consolidated entity, to set
appropriate risk limits and controls, and to monitor risks and adherence to limits. Risk management policies and
systems are reviewed regularly to reflect changes in market conditions and the consolidated activities. The Company
and its subsidiary, through their training and management standards and procedures, aim to develop a disciplined
and constructive control environment in which all employees understand their roles and obligations.
The
Audit & Risk
Committee oversees how management monitors compliance with the consolidated entity’s risk
management
policies and procedures, and reviews the adequacy of the risk management framework in relation to the
risks faced by the consolidated entity.
Credit risk
Credit risk represents the loss that would be recognised if a customer or counterparty failed to perform their
contractual obligations and arises principally from the consolidated entity’s receivables from licensees and
investments in short-term deposits.
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 33
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
18. FINANCIAL RISK MANAGEMENT CONTINUED
[a] Overview continued
Trade receivables
The consolidated entity’s exposure to credit risk is influenced mainly by the individual characteristics of each licensee.
Concentrations of credit risk are minimised by undertaking transactions with a large number of licensees and
counterparties with no geographical concentration of credit risk.
Approximately 70% of the consolidated entity’s revenue base is attributable to general licensing in Australia, where
licensee fees are paid at the beginning of the licence period, normally 12 months. The Audit & Risk Committee has
established a credit policy under which defaulting licensees are pursued rigorously.
The consolidated entity has established, where necessary, an allowance for impairment that represents its estimate
of incurred losses in respect of trade and other receivables. The main component of this allowance is for trade debtor
balances assessed on an individual account basis and provided for when recovery is considered doubtful.
Investments in short-term deposits
The consolidated entity minimises credit risks in relation to its investments in short-term deposits by only dealing
with Australian banks maintaining an acceptable credit rating.
Liquidity risk
Liquidity risk is the risk that the consolidated entity will not be able to meet its obligations as they fall due.
The consolidated entity’s approach to managing liquidity is to ensure that it will always have sufficient liquidity to
meet its liabilities when due, under both normal and unusual conditions, without incurring unacceptable losses or
risking damage to the consolidated entity’s reputation.
Typically the consolidated entity ensures that it has sufficient cash on demand to meet expected member distributions
and operational expenses for a period of 60 days. This excludes the potential impact of extreme circumstances that
cannot reasonably be predicted, such as natural disasters. The consolidated entity has additional deposits invested for
short terms varying from 90 to 365 days.
Market risk
Market risk is the risk that changes in market prices such as foreign exchange rates and interest rates will affect
the consolidated entity’s income or the value of its holding of financial instruments. The objective of market risk
management is to manage and control market risk exposures within acceptable parameters, while optimising
the return.
Interest rate risk
The consolidated entity is exposed to interest rate risk in relation to its cash and cash on deposit balances.
The weighted average interest rate on cash and cash on deposit of $68,022,586 at 30 June 2020 is 1.03%
[2019: $64,007,994 - 2.44%]. It is the Company's policy not to hedge this exposure to interest rate risk.
Currency risk
The consolidated entity receives royalties from overseas affiliates in foreign currencies. It is group policy not to
hedge this exposure to foreign exchange risk.
Fair values
The carrying value of financial assets and liabilities in the balance sheet approximates their fair values.
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
34
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
18. FINANCIAL RISK MANAGEMENT CONTINUED
[b] Financial transactions
Credit risk
Exposure to credit risk
The carrying amount of the consolidated entity’s financial assets represents the maximum credit exposure.
The consolidated entity’s maximum exposure to credit risk at the reporting date was:
2020 2019
$000s $000s
Cash and cash equivalents 3,213 3,321
Cash on deposit 64,809 60,687
Trade and other receivables 4,703 9,480
72,725 73,488
Impairment losses
The ageing of the consolidated entity and the Company’s trade receivables at the reporting date was:
2020 2019
$000s $000s
Not past due 3,714 4,788
Past due 0-30 days 472 636
Past due 31-120 days 58 504
Past due 121 days 335 168
4,579 6,096
As at 30 June 2020, the Consolidated Entity did not recognise a provision for impairment due to the Directors being
of the opinion that the amounts receivable are recoverable [2019: $Nil].
Liquidity risk
The contractual maturities of financial liabilities, as represented by trade and other payables [Note 12] and other
current liabilities [Note 15], are all within one year. The carrying amount of these liabilities also represents the
contractual cash flows.
Currency risk
Exposure to currency risk
The exposure to foreign currency risk at balance date was as follows, based on notional amounts:
2020 2019
AUD equivalent of NZD exposure
$000s $000s
Trade receivables 47 28
Total balance sheet exposure 47 28
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 35
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
18. FINANCIAL RISK MANAGEMENT CONTINUED
[b] Financial transactions continued
The following significant exchange rates applied during the year:
Average rate
2020
Average rate
2019
Spot rate
2020
Spot rate
2019
New Zealand Dollar 1.0548 1.0355 1.0199 1.0446
Sensitivity
A 10% strengthening/weakening of the Australian Dollar against the New Zealand Dollar at 30 June would have
increased/[decreased] the consolidated entity’s profit/[loss] by $4,656 at 30 June 2020 [2019: $2,759]. This analysis
assumes that all other variables, in particular interest rates, remain constant.
Interest rate risk
Profile
At the reporting date the interest rate profile of the consolidated entity’s interest-bearing financial instruments was:
Carrying Amount
2020 2019
$000s $000s
Fixed rate instruments
Cash on deposits 64,809 60,687
Variable rate instruments
Cash at bank 3,213 3,321
Sensitivity analysis
If interest rates had changed by plus/[minus] 100 basis points per annum from the year end interest rate,
with all other variables held constant, the consolidated entity profit for the year would have been $32,130
[2019: $33,210].
19. NOTES TO THE STATEMENT OF CASH FLOWS
[a] Reconciliation of cash
For the purposes of the Statement of Cash Flows, cash includes cash on hand and at bank and short term deposits
at call. Cash as at the end of the financial year as shown in the Statement of Cash Flows is reconciled to the related
items in the balance sheet as follows:
2020 2019
$000s $000s
Cash 3,213 3,321
3,213 3,321
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
36
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
19. NOTES TO THE STATEMENT OF CASH FLOWS
CONTINUED
2020 2019
$000s $000s
[b] Reconciliation of cash flows from operating activities
Operating profit/[loss] — —
Add/[less] items classified as investing activities:
Interest received [1,427] [1,699]
Add/[less] non-cash items:
Depreciation and amortisation 908 574
Interest expense 40 —
Net cash utilised by operating activities before change in
assets and liabilities [479] [1,125]
Change in assets and liabilities:
Decrease/[increase] in trade and other receivables 4,777 [5,449]
Increase/[decrease] in trade creditors and accruals 31 [77]
Increase in royalties in advance 154 435
Increase/[decrease] in provision for employee entitlements 66 [27]
[Decrease]/increase in provisions [239] 13
[Decrease]/increase in distributable amounts [1,296] 1,990
Net cash provided by/[used in] operating activities 3,014 [4,240]
20. RELATED PARTY DISCLOSURES
Key management personnel compensation
The key management personnel compensation included in ‘employee expenses’ [see Note 4] is as follows:
2020 2019
$000s $000s
Short-term employee benefits 2,038 2,054
Post-employment benefits 97 153
Other long-term benefits 38 31
2,173 2,238
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 37
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
20. RELATED PARTY DISCLOSURES CONTINUED
Statement of management remuneration
Salary range*
Screenrights Executives
in range 2019/20
Screenrights Executives
in range 2018/19
$0-99k 2** 2**
$100-149k 1 1
$150-199k 2 2
$200-249k 4 2
$250-299k — 2
$300-400k 1 1
* Includes superannuation, leave provisions and incentive payments
** Includes executives who held a key management position for part of the year
Statement of management remuneration
A number of key management persons of the Company, or their related parties, hold positions in other entities
that result in them having control or significant influence over the financial or operating policies of these entities.
A number of these entities transacted with the Group in the reporting period. The terms and conditions of the
transactions with key management personnel and their related parties were no more favourable than those
available, or which might reasonably be expected to be available, on similar transactions to non-key management
personnel related entities or on an arm’s length basis. Related entities of Jonathan Carter, Kim Dalton, Ben Grant,
Kelly Lefever, Victoria Spackman and Georgina Waite, or entities in which they hold a management position, are
entitled to distributions calculated in accordance with Note 1[n].
Apart from the details disclosed in this note, no key management personnel have entered into a material contract
with the Company or consolidated entity since the end of the previous financial year and there were no material
contracts involving key management personnel interests subsisting at year end.
Loans to key management personnel
There were no loans to key personnel at any time during the year ended 30 June 2020.
Controlled entity
On 15 May 2006, Audio-Visual Copyright Society Limited [the Company] established a wholly owned subsidiary
company called EnhanceTV Pty Ltd. The objectives of the Company are to operate as an educational resource
centre and to operate as a distribution outlet for the Australian educational market. At 30 June 2020, in respect of
management fees, the company owed the subsidiary $1,226,766 [2019: $652,809].
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
38
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
21. MEMBERS’ LIABILITY
The Company is a company limited by guarantee. The guarantee of members in the event of the winding up of the
Company is $10 for each member. At 30 June 2020, membership of the Company comprised 4,709 full members
[2019: 4,438], resulting in a total guarantee of $47,090 [2019: $44,380].
22. COMMITMENTS FOR EXPENDITURE
The consolidated entity applied AASB 16 with a date of initial application of 1 July 2019. As a result, the consolidated
entity has changed its accounting policy for operating lease contracts/commitments as detailed in Note 1[r].There are
no other commitments.
23. CONTINGENT LIABILITY
The parent entity does not have any contingent liabilities at 30 June 2020 [2019: $ NIL].
24. PARENT ENTITY DISCLOSURES
As at, and throughout, the financial year ended 30 June 2020, the parent entity of the consolidated entity was
Audio-Visual Copyright Society Limited.
2020 2019
$000s $000s
Result of parent entity
Profit/[loss] for the period — —
Other comprehensive income — —
Total comprehensive profit/[loss] — —
Financial position of parent entity at year end
Current assets 72,586 73,504
Total assets 75,082 75,559
Current liabilities 71,226 72,097
Total liabilities 73,513 73,990
1,569 1,569
Total equity of the parent entity comprising of:
Retained earnings 1,369 1,369
Reserves 200 200
Total equity 1,569 1,569
SCREENRIGHTS ANNUAL REPORT 2019–2020 | 39
For the year ended 30 June 2020
NOTES TO THE CONSOLIDATED
FINANCIAL STATEMENTS
25. SUBSEQUENT EVENTS
On 22 July 2020, Screenrights filed in the Copyright Tribunal for a determination of equitable remuneration with Foxtel.
There has not arisen in the interval between the end of the financial year and the date of this report, any other item,
transaction or event of a material and unusual nature that is likely, in the opinion of the Directors, to affect significantly
the operations of the consolidated entity, the results of those operations or the state of affairs of the consolidated entity
in future financial years.
AUDIO-VISUAL COPYRIGHT SOCIETY LIMITED
40
SUPPLEMENTARY REPORTING FOR EACH AUSTRALIAN STATUTORY LICENSEE CLASS
APPENDIX
Commonwealth
Government
$
State and
Territory
Governments
$
Schools
$
Universities
$
TAFE
$
Other
Australian
Educational
Institutions
$
TOTAL
$
Total licence
fees received
40,491 1,107,217 26,835,030 5,960,146 332,891 22,827
34,298,602
Income on
investments
of licence fees
1,045 28,563 695,578 154,490 8,629 592
888,897
Total amount
allocated to
members
34,332 938,806 22,717,923 5,045,723 281,818 19,326
29,037,928
Total amount
paid to
members
56,721 1,551,024 21,913,436 4,867,044 271,838 18,641
28,678,704
Total amount
of licence fees
held in trust
45,965 1,256,921 30,015,131 6,666,457 372,341 25,534
38,382,349
Total licence
fees for which
the trust period
expired*
1,048 28,650 342,987 76,179 4,255 291
453,410
* Licence fees for which the trust period expired during the year are recorded in separate distribution pools for
Government and Education. Any further breakdown by statutory licensee class is calculated pro rata, based on licence
fees received.
For the year ended 30 June 2020
