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Results

Amenity related services

Performance criterion

Provide financial assistance through a loan or grant to fund unit amenity initiatives not normally provided at Departmental level.

Criterion source

Corporate Plan 2018-19. Activity 1

Results against performance criterion

1.During the reporting period Army Amenities Fund sponsored 30 grant bids from units totalling $84,358. The grants ranged from $2,000 up to $19,000 and overall were well within available funds. The newly launched Grant Committee in July 2018 has promoted the availability of amenity funding and resulted in an increase in grant applications.

2.For this reporting period funds have been used to support sponsor the amenity costs for sporting and adventure training activities, purchase of new social club equipment and sponsorship support for social events attended by Army members, their families and Defence communities.

Holiday facilities

Performance criterion

Provide below market price quality accommodation for Army members and eligible persons through Trust-owned holiday properties.

Criterion source

Corporate Plan 2018-19. Activity 2

Results against performance criterion

  1. Holiday facilities profile met its objective to provide amenities primarily used by current and former Army members. As at 30 June 2019 the overall land and buildings value reported a total book value of $5,414,875.
  2. Tariff rates were reviewed and found to be under the 75% commercial rate criteria. The Board agreed to increase rates for 2018-19 reporting period.
  3. Overall the property portfolio did not achieve an annual cash break even or better outcome. The seven properties received rental income of $193,177. On the expense side, the largest expense is cleaning and linen hire. Total spending on this category was $46,852. Followed by the body corporate levies in the amount of $31,556 and repairs and maintenance in the amount $24,826. The property management fee for Coogee and Docklands apartments was reported in the amount of $17,096 in total. The Goolwa property manager’s salary plus other employee benefits was reported at $30,947. A total cost of $16,360 was spent for the utilities bills amongst the properties.
  4. Occupancy levels during the reporting period have underachieved their targets. Coogee’s occupancy rate at 51% against its target didn’t have a negative impact on its financial outcome as the tariff rates offset the costs. This applied to the Docklands apartments as well. The Army occupancy level continues to be higher for Coogee at 56% and Docklands at 71% compared to other Services or eligible persons. Goolwa’s Army occupancy level remained low with only 24% during this reporting period.

Location

Target occupancy %

Actual occupancy %

Army occupancy %

Coogee

65

51

56

Goolwa

60

51

24

Docklands

80

61

71

Financial Investment

Performance criterion

Conduct sound financial investment strategies that ensures sufficient capital is available to meet the operational goals and the Trusts remain self-sustaining.

Criterion source

Corporate Plan 2018-19. Activity 3

Results against performance criterion

1.The Company’s (as trustee for the Army Amenity Funds) investment portfolio currently totals $8,905,860 compared to $8,715,948 in 2017-18. Overall, the operational goals have been met and income generated from the investment portfolio will ensure available cash for future years of operation.

a)The investment strategy approach is to split the investment portfolio between 70 per cent growth and 30 per cent defensive components.

b) The ‘Administrative’ component of the investment portfolio is to generate sufficient income to fund 'normal' operations. $200,000 was withdrawn for operations and this amount has been transferred from Fiducian portfolio to cover future operational withdrawals. Fiducian growth was reported at $16,052 in this reporting period. While Asgard reported a strong capital growth in the amount of $173,860 equates to an annual net return of 10 per cent.

2.The Company’s (as trustee for the Messes Trust Fund) term deposit provided an interest return of $16,970 at this reporting period. Total deposit balance is $701,856 as at 30 June 2019.