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12. Related party disclosure

12A. Related party relationships

ILSC is an Australian Government controlled entity. Related parties are key management personnel, subsidiaries, entities controlled by related parties and other Australian Government controlled entities.

Key management personnel

Key management personnel are described in note 11.

Subsidiaries of ILSC

Primary Partners Pty Ltd (PPPL)

National Centre of Indigenous Excellence Ltd (NCIE)

Voyages Indigenous Tourism Australia Pty Ltd (Voyages)

The Owners – Strata Plan No. 86156 (The Owners Corp)

Yamanah Investments Pty Ltd (Yamanah)

Entities controlled by a related person

The following Directors of ILSC, or its subsidiaries, are also Directors of Indigenous Business Australia (IBA):

Ah See, Roy

Allert, Richard

Fry, Eddie

Transactions with IBA are disclosed in note 12B.

The Group received services from SRG Partners (an accounting and corporate advisory practice) at which time a KMP was a Director of this business. Transactions with SRG Partners are disclosed in note 12B.

Other Australian Government controlled entities

The Group transacts with other Australian Government controlled entities consistent with normal day to day business operations provided under normal terms and conditions, including the payment of workers compensation premiums, insurance premiums and legal services.

The Group also receives grants from other Australian Government controlled entities consistent with normal day to day business operations.

12B. Transactions with related parties

Key management personnel

No key management personnel has received or became entitled to receive, during or since the end of the financial year, a benefit due to any contract or contracts made by the Group other than disclosed below.








The following transactions with KMP related parties occurred during the financial year:

Purchases from related parties:

Indigenous Business Australia



SRG Partners



Sales to related parties:

Indigenous Business Australia



12C. ILSC Group

The following table provides ILSC's ownership percentage in each of its controlled entities, all of which are incorporated in Australia:





Primary Partners Pty Ltd



National Centre of Indigenous Excellence Ltd



Voyages Indigenous Tourism Australia Pty Ltd



The Owners – Strata Plan No. 86156



Yamanah Investments Pty Ltd



PPPL was established in 2004 as a wholly-owned subsidiary of the ILSC. Until 1 September 2014 PPPL was the employment vehicle for staff working on ILSC-held properties and agribusinesses. Thereafter some properties were transferred to and managed by PPPL. More recently, some properties were transferred back to ILSC to grant to Aboriginal Corporations.

NCIE was incorporated to manage the National Centre of Indigenous Excellence in Redfern NSW on behalf of the ILSC. No income or property of NCIE may be paid or transferred, directly to any member of NCIE whether by way of dividend, bonus or otherwise. The ILSC is the sole member of NCIE.

Yamanah was incorporated in November 2019 to identify business development opportunities to benefit Indigenous organisations in the Murray Darling Basin area.

Voyages was incorporated to own and manage Ayers Rock Resort in Yulara NT on behalf of the ILSC.

On 8 February 2012, the ILSC registered a strata title scheme that separated a building owned by the ILSC into separate strata title lots. Upon the registration of the strata scheme four certificates of title were issued. Three titles are in the name of the ILSC representing three separate strata title lots. The fourth title is in the name of The Owners—Strata Plan No 86156 and represents the common area of the property. During the 2015/2016 the ILSC transferred one lot to an Aboriginal Corporation. As the ILSC still owns two of the three lots it effectively controls The Owners—Strata Plan No 86156.

Future shareholding in Voyages

Prior to its purchase of Ayers Rock Resort (ARR), the ILSC entered into a Deed of Agreement (Deed) with Wana Ungkunytja Pty Ltd (WU) in May 2010 in recognition of WU not exercising its first right of refusal to purchase ARR. In accordance with the Deed, WU will be offered seven percent of the issued share capital of the entity operating the business of ARR, currently Voyages, for no consideration, upon the earlier of the repayment of interest-bearing loans or May 2021. Under the Deed, WU have up to six months to accept the offer.

Considering the terms of the Deed and the differing obligations that apply to the real estate and non-real estate assets held by Voyages, ILSC is of the view that it is not, for the purposes of the 30 June 2020 financial statements, possible to quantify with any reasonable certainty the fair value of WU’s interest in ARR.

12D. Transactions with wholly-owned entities

The ILSC is the ultimate parent entity in the wholly-owned group comprising itself and its wholly owned subsidiaries PPPL, NCIE, Voyages, Yamanah and The Owners Corp.

Section 191G of the ATSI Act allows the ILSC to create subsidiaries and to fund them by way of loan or grant. The deeds of agreement between the ILSC and NCIE and the ILSC and PPPL reflect the Act and express that the ILSC will make an annual advance of funds to allow NCIE and PPPL to pay debts as and when due.

The ILSC provided financial support to PPPL and NCIE as follows:

PPPL - $3,125,000 (2019: $3,376,000)

NCIE - $4,878,000 (2019: $3,955,000)

During the year, ILSC purchased services from NCIE of $nil (2019: $781).

The ILSC owns properties that are used by its subsidiary PPPL. ILSC provides these properties at no, or significantly below market, rents. Under AASB 1058 Income of Not-for-Profit Entities, the difference between the ROU asset measured at fair value and the lease liability at nominal peppercorn payments is recognised immediately as income. In accordance with AASB 16 Leases, the Group has elected to measure ‘peppercorn’ leases RoU assets at cost by the lessee.

NCIE use an ILSC premises at Redfern, NSW, however it is not considered a lease in the absence of a written agreement and ILSC directing the purpose of the use of the asset. In accordance with AASB 1058 Income of Not-for-Profit Entities, NCIE record the free use of the land and buildings as a resource received free of charge (income) measured at fair value, with a corresponding expense recognised for its consumption. The fair value has been estimated to be $1,985,000 per annum (2019: $2,002,000).

In 2011 the ILSC provided Voyages with loan funding associated with the purchase of ARR. During the year, Voyages made $3,900,000 (2019: $12,161,000) of repayments to the intercompany loan to the ILSC.

The 30 June 2020 loan balance owing is $280.9m (2019: $276.9m) and includes interest charged of $10.7m (2019: $12.1m). The loan includes ILSC funding provided during the year ended 30 June 2020 in support of Indigenous Training and Employment projects of $2.1m (2019: $2.3m). Additionally, ILSC provided funding for operations at Mossman Gorge of $12k (2019: $0.5m) and wage subsidies totalling $0.5m (2019: $nil).