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Director's Report

Minister for Veterans and Defence Personnel

Dear Minister

The Directors of the AAF Company have the honour to submit their report of operations for the year ended 30 June 2020.

Enabling legislation and responsible Minister

The AAF Company was incorporated on 17 July 1987, to administer the assets of the Army Amenities Fund and the Messes Trust Fund, and is subject to the Corporations Act 2001.

The AAF Company operates within the Defence portfolio, reporting to the Minister for Veterans and Defence Personnel (the Minister), at the date of this report.

Public Governance, Performance and Accountability Act 2013 and Australian Charities and Not-for-profits Commission Act 2012

The AAF Company also complies with the requirements of the Public Governance, Performance and Accountability Act 2013 (PGPA) and Not-for-profits Commission Act 2012 with respect to:

  • reporting to Ministers and Parliament;
  • contents of Annual Report;
  • audit of the AAF Company’s financial statements by the Auditor- General;
  • banking and investment powers of authority;
  • general policies of the Australian Government; and
  • conduct of directors and officers, including the civil consequences of any breach of their duties by the directors and officers.

Accountable Authority

The following persons formed the accountable authority (Board) of the AAF Company during or since the end of the financial year:

Board of Directors

Appointed Date

Resigned Date

Brigadier W.B. Stothart(Chair)

21 Jan 2019

Colonel A.R. Fielding

20 Jun 2016

31 Oct 2019

Colonel M.R. Kennedy

05 May 2017

10 Dec 2019

Colonel F.C. Curtis

16 Apr 2019

Colonel K.M. Skinner

16 Apr 2019

Colonel N. Gabbedy

17 Feb 2020

Lieutenant Colonel S. Trim

15 Apr 2020

Warrant Officer G.S. McFarlane

27 Aug 2018

Warrant Officer Class One K. Felmingham

16 Apr 2019

Statement of Intent

The Board of Directors of the AAF Company will:

  • manage the assets of the AAF Company in a manner which ensures financial independence and long term sustainability;
  • encourage continuous improvement practices to maximise opportunities that will ensure its long term sustainability;
  • provide the Minister with annual financials and compliance reports, with copies to be provided to the Secretary for Defence, the Chief of the Defence Force and the Chief of Army;
  • adopt best practice governance principles and implement risk management strategies as determined by the Commonwealth, as appropriate for the operation of small agencies;
  • identify and manage all actual and perceived conflicts of interest, advising the Minister of any significant issues as they arise; and
  • demonstrate compliance with appropriate government policy and directions.

Organisational structure

The AAF Company is a Commonwealth Company and is managed by the Board of Directors (the Board), in accordance with the Company’s Constitution, appointed by the Chief of Army and the Board. The AAF Company head office is located in Canberra, ACT.

Review of operations and future prospects

Operations comprised the provision of discounted holiday accommodations for Army members, their families and other eligible persons. Also to provide financial support to Command and Units to assist in the provision of amenities to Army members.

The Board has been starting to deliberate a sale of its properties at Goolwa, South Australia. The elementary stage has begun since August 2019 and it is anticipated a final outcome will be reached in March 2021.

Reviews by outside bodies

The AAF Company financial statements are subject to audit by the Australian National Audit Office.

Significant non-compliance issues with finance law

Section 17AG and 17BE of the PGPA Rule require that Commonwealth entities’ annual reports must include a statement of any significant non-compliance issues notified to the responsible Minister under paragraph 19(1)(e) of the PGPA Act during the reporting period and outline the actions taken to remedy the non-compliance. There have not been any non-compliance issues in this reporting period.

Board of Directors

  • The Board comprises serving members of the Army.
  • Board members are not entitled to any remuneration.
  • Directors are expected to comply with the conflict of interest policy and declare any potential conflict according to the policy at the start of each Board meeting.

During 2019-20 the Board met six times including an AGM. These meetings were held in Canberra and in Goolwa, South Australia.

Board member’s attendance at meetings

Name

Position

Meetings Attended

Appointed Date

Brigadier W.B. Stothart

Board Chair

6

21 Jan 2019

Colonel A.R. Fielding

Director

2#

20 Jun 2016

Colonel M.R. Kennedy

Director

3#

05 May 2017

Colonel F.C. Curtis

Director

6

16 Apr 2019

Colonel K.M. Skinner

Director

6

16 Apr 2019

Colonel N. Gabbedy

Director

1

17 Feb 2020

Lieutenant Colonel Siobhan Trim

Director

2

15 Apr 2020

Warrant Officer G.S. McFarlane

Director

3

27 Aug 2018

Warrant Officer Class One K. Felmingham

Director

3

16 Apr 2019

# Resigned during the 2019-20 financial year.

Directors of the AAF Company

Brigadier Wade Stothart, DSC, AM, CSC. Brigadier Stothart joined the Australian Regular Army in 1987 and completed operational service in Bosnia, East Timor, Afghanistan, and the Middle East. Brigadier Stothart holds a Bachelor of Arts, Master of Arts (International Relations), Master of Management, Maser of Policy and completed the Company Directors Course in 2019.

Colonel Amanda Fielding. Colonel Fielding joined the Australian Regular Army in 1992 and completed operational service in East Timor, Iraq and Afghanistan. Colonel Fielding holds a Bachelor of Arts (Politics), Master of Arts (Strategic Policy and Management) and completed the Company Directors Course in 2018.

Colonel Mitch Kennedy. Colonel Kennedy joined the Australian Regular Army in 1997 after service in the British Army and completed operational service in Northern Ireland, East Timor and Afghanistan. Colonel Kennedy holds a Bachelor of Arts (with Honours), Master of Management (Defence Studies) and attended the Company Directors Course in 2018.

Colonel Fiona Curtis. Colonel Curtis joined the Australian Regular Army in 1996. Colonel Curtis holds undergraduate degrees in Arts and Education and post graduate diplomas in Educational Studies (Teaching English to Speakers of Other Languages) and Organisational Training and Development. COL Curtis has completed an advanced diploma in Vietnamese language and holds a Master of Professional Studies, a Master of Business and a Master in Instructional Systems and Learning Technologies. Colonel Curtis completed the Company Directors Course in 2019.

Colonel Kirsty Skinner, CSC. Colonel Skinner joined the Australian Regular Army in 1992 and completed operational service in East Timor and Iraq. Colonel Skinner holds a Bachelor of Arts (Politics), Graduate Certificate (Agribusiness), Graduate Diploma (Defence Studies), Master of Arts (Strategic Policy and Management) and completed the Company Directors Course in 2019.

Colonel Nigel Gabbedy. Colonel Gabbedy joined the Australian Regular Army in 1993 and completed operational service in Afghanistan. Colonel Gabbedy holds a Bachelor of Commerce and Laws, Graduate Diploma (Military Legal Studies) and is completing the Company Directors Course in 2020.

Lieutenant Colonel Siobhan Trim. Lieutenant Colonel Trim joined the Australian Army - Reserve in 1998, later transferring to the Regular Army and completed operational service in Papua New Guinea and the Middle East. Lieutenant Colonel Trim holds a Diploma of Financial Services (Financial Planning), Bachelor of Business (Professional Accounting), a Masters of Business, is a Certified Practising Accountant (CPA) with Public Practice Management Program, and will complete the Company Directors Course in 2021.

Warrant Officer Grant McFarlane, OAM. Warrant Officer McFarlane joined the Australian Regular Army in 1980 and completed operational service in East Timor and Afghanistan. Warrant Officer McFarlane was appointed as the Regimental Sergeant Major – Army in July 2018 and completed the Company Directors Course in 2020.

Warrant Officer Kim Felmingham, NSC, OAM. Warrant Officer Felmingham joined the Australian Regular Army in 1986 and completed operational service in Somalia, East Timor, Solomon Islands and Middle East. Warrant Officer Felmingham was appointed as the Command Sergeant Major – Forces Command in December 2019 and completed the Company Directors Course in 2020.

Audit Committee

In accordance with the requirements of the PGPA Act the Company has established an Audit Committee. The primary objectives of the Audit Committee are stated in the charter at (https://armyholidays.com.au).

The Audit Committee provides advice to the Board and its main objectives are:

  • improving the effectiveness and efficiency of the Company’s internal control framework;
  • ensuring that the Company has appropriate risk identification and management practices in place;
  • improving the objectivity and reliability of financial reporting;
  • ensuring that the Company has adequate procedures on matters of audit independence’ and
  • ensuring the Board complies with all governance and other obligations.

Audit Committee Member:

Chair - Lieutenant Colonel Siobhan Trim (Board of Director)

Member - Colonel Nigel Gabbedy (Board of Director), and

Independent Member.

Freedom of Information (FOI)

There have not been any FOI enquiries were received during the reporting period.

Indemnities and insurance premiums for officers

The AAF Company has coverage with COMCOVER for Association Liability Insurance. Where applicable, the insurance cover is provided for all Directors, staff and contractors. No indemnity has been provided to an officer against any potential liability for legal costs.

Risk management and fraud control

The Directors have established a risk management and fraud control plan in line with the Commonwealth’s endeavours to make risk management an integral part of everyday business practice. The AAF Company does not receive any funding from the Commonwealth and therefore not to apply the promulgated Commonwealth Risk Management Policy. However, the Directors have adopted the Policy as best practice standards for fraud control and have implemented fraud control arrangements commensurate with the AAF Company’s activities.

Work Health and Safety (WH&S)

Staff supporting the operations of the AAF Company are employed by the Commonwealth - Department of Defence and, as such, fall within the policies and procedures of the Department for WH&S purposes.