NSW Institute of Teachers Annual Report

Maintaining Accreditation at Professional Competence

2007-2008

Annual Report NSW Institute of Teachers

Contents

Letter to the Minister 1

Introduction 3

Access 3

Summary Review of Operations 3

Management and Structure 4

Key Achievements and Initiatives 5

Promotion 15

Government Policies and Requirements 15

Budget Summary 18

Independent Audit Report 19

Financial Statements 21

Appendix 1: NSW Institute of Teachers – Structure 68

ANNUAL REPORT 2007-2008

Verity Firth MP

Minister for Education and Training

Level 31 Governor Macquarie Tower

1 Farrer Place

SYDNEY NSW 2000

Dear Minister

I am pleased to forward to you the fourth NSW Institute of Teachers’ Annual Report for presentation

to Parliament. The report covers the financial year 1 July 2007 to 30 June 2008.

The report has been prepared under Sections 7, 8 and 9 of the Annual Reports (Statutory Bodies)

Act 1984.

Key achievements for the year include:

n initial accreditation of 7 662 new scheme teachers

n accreditation at Professional Competence of 2 626 teachers

n Ministerial launch of the policy and support documents for the accreditation of teachers at

Professional Accomplishment and Professional Leadership

n Ministerial approval of Supplementary Documentation – Graduate Teacher Standards 1.1.1-1.1.3

(Subject Content Requirements)

n implementation of teachers’ on-line professional learning logs

n conduct of the Review of the Act as required by Section 55 of the Institute of Teachers Act 2004.

The Report will be printed and distributed and also published on the Institute’s website

www.nswteachers.nsw.edu.au.

Yours sincerely

Professor Phil Foreman Tom Alegounarias

Chair Member

20 October 2008 20 October 2008

NSW INSTITUTE OF TEACHERS PO Box A976 Sydney South NSW 2001

Telephone: 1300 739 338 Fax: 02 9268 6313 Email: [email protected] Web: www.nswteachers.nsw.edu.au

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2

NSW INSTITUTE OF TEACHERS

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INTRODUCTION

The NSW Institute of Teachers was established under the

Institute of Teachers Act 2004 with subordinate legislation

Institute of Teachers Regulation 2005 and Institute of

Teachers Amendment (Elections) Regulation 2005.

The Governor gave assent to the Act on 6 July 2004.

Parts 1, 2 and 5 of the Act were proclaimed on 9 August

2004, while Parts 3 and 4 relating to the functions of the

Institute (the remainder of the Act) were proclaimed on

24 January 2005.

The Institute is within the portfolio of the Minister for

Education and Training.

The Institute was established to support the quality of

teachers in NSW schools. This will be achieved through the

functions conferred by the Act of:

n advising the Minister on the development, content and

application of the Professional Teaching Standards

n advising and assisting teacher accreditation authorities

in accrediting teachers

n monitoring the accreditation process across all NSW

schools

n ensuring the Professional Teaching Standards are

applied fairly and consistently

n advising the Minister on the approval of initial and

continuing teacher education courses and programs

n advising the Minister on the approval of persons or

bodies who may provide continuing professional

development for teachers.

ACCESS

NSW Institute of Teachers

Level 10

175 Castlereagh Street

SYDNEY NSW 2000

(PO Box A976

SYDNEY SOUTH NSW 1235)

Hours of business 8.30 am – 5.30 pm

Monday to Friday

SUMMARY REVIEW OF OPERATIONS

The Institute of Teachers Act 2004 allows the work of the

Institute to be structured around four key areas:

n Standards and Accreditation

n Initial Teacher Education

n Professional Learning

n Corporate Services.

Key achievements and initiatives for the 2007/2008

financial year were:

Standards and Accreditation

n Ministerial launch of policy and support documents

for the accreditation of teachers at Professional

Accomplishment and Professional Leadership

n initial accreditation of 7 662 new scheme teachers

n accreditation at Professional Competence of 2 626

teachers

n ongoing training of 93 external assessors who then

reviewed 1 724 reports for accreditation at Professional

Competence

n finalisation of a report to teacher accreditation

authorities with regard to accreditation at Professional

Competence

n agreement with the Teacher Registration Board of the

Northern Territory for recognition of the accreditation

status of NSW teachers in the Northern Territory

n development of policy and processes for voluntary

accreditation at Professional Competence

n development of draft Statement of Professional Ethics

for consultation

n development of support material for casual, temporary

and part-time teachers

n endorsement and implementation of policy for minimum

English language requirements at the point of approval

to teach

n sixty-one presentations by Institute staff to stakeholders

about the accreditation of teachers in NSW schools.

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Initial Teacher Education

n endorsement by the Initial Teacher Education

Committee and Quality Teaching Council, and

Ministerial approval of Supplementary Documentation

– Graduate Teacher Standards 1.1.1-1.1.3 (Subject

Content Requirements)

n convening of panels to review and assess programs

of initial teacher education

n development of draft Professional Experience

requirements for consultation

n continuing development of draft national guidelines

for approval of pre-service teacher education programs

in conjunction with the Australasian Teacher

Regulatory Authorities (ATRA) for the consideration

of the Ministerial Council on Education, Employment,

Training and Youth Affairs (MCEETYA).

Professional Learning

n endorsement of Policy on Undergraduate and

Postgraduate Studies Supporting the Maintenance

of Accreditation

n conduct of six Professional Learning Endorsement and

Advisory Committee meetings

n implementation of teachers’ on-line professional

learning logs. All teachers accredited at Professional

Competence are able to both log and evaluate their

professional learning

n endorsement of 35 providers of continuing

professional development

n registration of over 1000 courses and programs

n development and distribution of new endorsed

providers’ manual to support providers in registering

their courses on the Institute’s website

n development and distribution of new support material

for providers wishing to apply for endorsement

(Becoming a NSW Institute of Teachers’ Endorsed

Provider of Institute Registered Professional

Development manual)

n development of support material for teachers

(Continuing Professional Development: Maintaining

Accreditation at Professional Competence –

Information for Teachers)

n twenty presentations to teachers on the professional

development requirements for the purpose of

maintaining accreditation at Professional Competence.

Corporate Services

n conduct of the Review of the Act as required by Section

55 of the Institute of Teachers Act 2004

n conduct of three Board meetings and five Quality

Teaching Council meetings

n relocation of premises in October 2007

n review and implementation of an Internal Audit Plan

for 2007/2008

n conduct of two audits of teachers’ and teacher

accreditation authorities’ compliance with

accreditation requirements

n support for annual audit by the Audit Office

n on-going maintenance of database including regular

updating of accreditation status of teachers eg

achievement of Professional Competence, withdrawal

from accreditation, returning from leave of absence,

mutual recognition

n development of an on-line process for completion

of accreditation submissions at the higher levels

of accreditation

n invoicing and collection of accreditation fees.

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MANAGEMENT AND STRUCTURE

Board of Governance

The Board was established to:

n oversee the functions, finances, strategic direction

and operations of the Institute

n monitor the management and performance of

the Institute

n govern the affairs of the Institute.

The Minister for Education and Training appointed a new

Chair, Professor Philip Foreman, in November 2007.

The Minister also extended the terms of the other three

appointed members another three years to December 2010.

Members

From November 2007 to JuNe 2008

Professor Philip Foreman Bachelor of Arts,

Chair Master of Letters

NSW Institute of Teachers Master of Education,

Doctor of Philosophy

Fellow of the Australian

Psychological Society

From July 2007 – JuNe 2008

Mr Tom Alegounarias Bachelor of Economics,

Chief Executive Diploma of Education

NSW Institute of Teachers

Ms Jenni Neary Bachelor of Arts, Diploma of

Education. Fellow of the

Australian Institute of

Company Directors

Ms Penny Morris Bachelor of Architecture (Hons),

Master of Environmental Science,

Diploma of Company Directorship

Fellow of the Australian Institute

of Company Directors

Fellow of the Royal Australian

Institute of Architects

Mr John Azarias Master of Laws

Senior Partner Associate Member of the

Deloitte Touche Tohmatsu Institute of Chartered

Accountants

Meetings

Three Board meetings were held in the 2007/2008

financial year.

Below is a list of meetings attended by each

Board member.

Member Eligible Meetings

attended meeting

Philip Foreman 2 2

Tom Alegounarias 3 2

Jenni Neary 3 3

Penny Morris 3 3

John Azarias 3 3

Quality Teaching Council

The Institute of Teachers Act 2004 established the Quality

Teaching Council to be the Institute’s principal source of

advice on educational and professional issues.

Membership of the Council comprises the Chair, ten

members appointed by the Minister and ten members

elected by the profession.

Elections for the Quality Teaching Council are governed by

the Institute of Teachers Amendment (Elections) Regulation

2005 and were conducted in November 2005.

The Minister appointed the remaining members in

February 2006.

Composition of the Quality Teaching Council

Appointed Members

Position Name

Chair Professor Philip Foreman

from November 2007

Nominee of the NSW Mr Angelo Gavrielatos

Teachers Federation until January 2008

Mr Robert Lipscombe

from February 2008

Nominee of the NSW/ACT Ms Sandra White

Independent Education Union

Nominee of the Board of Studies Mr John O’Brien

Nominee of the Director-General Ms Gillian Shadwick

of Education and Training

Nominee of the Catholic Ms Julie Selkirk

Education Commission, NSW

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Nominee of the Association of Ms Estelle Lewis

Independent Schools of NSW

Nominee of the Minister Ms Sharryn Brownlee

representing the interests of

parents of school-age children

Nominee of the NSW Teacher Professor Jo-Anne Reid

Education Council

Two nominees of the Minister Ms Karen Buck

representing the interests of Vacant

teachers (at least one a member

of the Professional Teachers’

Council of NSW)

Elected Members

Electoral College Name(s)

Government school teachers Mr Christopher Tome

Mr Christiaan Goudkamp

Ms Pamela Gregg

Mr Philip Roberts

Mr Stephen Storey

Government primary

school principals Ms Shirley Steel

Government secondary

school principals Mr Gregory McGrath

Catholic systemic

school teachers Ms Kathy Gee

Catholic systemic

school principals Mr Michael Doyle

Independent school

teachers and principals Mr Michael Turner

KEY ACHIEVEMENTS AND INITIATIVES

The work of the Institute is organised around four key areas:

n Standards and Accreditation

n Initial Teacher Education

n Professional Learning

n Corporate Services.

Standards and Accreditation

Procedures have been established across all schools in

NSW to support mandatory teacher accreditation.

The Teacher Accreditation Manual is distributed to all

schools in NSW to support the implementation of this core

function. The Manual is a compendium of the Professional

Teaching Standards, all accreditation policies and all

support material developed by the Institute in consultation

with teachers and stakeholders.

All teachers accredited with the Institute receive copies

of the Professional Teaching Standards and the booklet

Information for New Scheme Teachers which describes

the accreditation process. From January 2008, newly

accredited teachers also receive a copy of the brochure

Advice for casual, temporary and part-time teachers.

Members of the Institute staff gave 61 presentations to

teachers, teacher employers, consultants and stakeholders

across NSW during the 2007/08 financial year.

ProvisioNal/coNditioNal accreditatioN

All teachers first employed in NSW schools from 1 October

2004, or returning to teaching after an absence of five

years or more, must be accredited. These teachers are

classified as new scheme teachers.

On employment, new scheme teachers are to be

provisionally or conditionally accredited by teacher

accreditation authorities on the basis of their initial teacher

education qualifications.

Teachers are provisionally accredited if they have

completed an approved program of initial teacher

education from NSW, other Australian states and territories

or overseas.

Until the Institute has fully implemented its initial teacher

education program approval procedures, transition

arrangements apply.

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Decisions to conditionally accredit teachers are based

upon the teacher holding a subject degree only or having

substantially completed a course of teacher education.

Conditionally accredited teachers must agree to gain a

teacher education qualification or its equivalent, or to

complete their current program. Ultimately they will also

need to meet the Standards for Professional Competence.

Between 1 July 2007 and 30 June 2008 inclusive, 7 056

teachers were provisionally accredited and 606 teachers

were conditionally accredited.

An audit of compliance with initial accreditation

requirements was conducted in the latter half of 2007.

A random sample of teacher accreditation authorities was

issued with a list of teachers initially accredited by them,

with a request to review to ensure all relevant teachers

were accredited.

Responses to the audit indicated a high degree of

compliance with initial accreditation requirements,

particularly after the first year of mandatory accreditation.

The Institute works closely with the NSW Board of Studies

in its role of registering non-government schools in

relation to monitoring compliance with teacher qualification

requirements. A Memorandum of Understanding concerning

the exchange of information has been signed with the

Board. This facilitates the review of teacher qualifications

when a school’s registration is due for renewal.

accreditatioN at ProFessioNal comPeteNce

Following employment, new scheme teachers must

demonstrate to their teacher accreditation authority1 that

they meet the Standards for Professional Competence

Professionally competent teachers have

demonstrated successful teaching experience. They

effectively monitor, evaluate and plan for learning.

They are able to tailor teaching programs to meet the

needs of individuals and groups within the class.

These teachers have a record of effective and ongoing

professional learning. They work collegially and in

teams to further enhance their professional practice.

They take responsibility for collaboration with others to

identify and address their own learning needs.

They are effective members of a school and its broader

community and interact effectively with stakeholders.

The maximum time that teachers have to achieve

Professional Competence depends on the nature of their

employment and whether they are provisionally or

conditionally accredited. This is summarised in the table below:

Provisional

Accreditation

Conditional

Accreditation

Permanent full-time

employment3 years 4 years

Part-time, temporary

or casual employment25 years 6 years

Achievement of the Standards at Professional Competence

is designed to be a formative, developmental process,

attained over time. It is expected that school personnel

support beginning teachers during this process, including

regular lesson observations and meetings with the

supervisor or mentor.

Once a teacher achieves Professional Competence, a

report written by his or her supervisor and endorsed by

the relevant teacher accreditation authority is forwarded

to the Institute together with documentary evidence of the

teacher’s work.

The Institute issues a letter of acknowledgement to the

teacher and sends a certificate signed by the Chair to the

relevant teacher accreditation authority to be countersigned

and presented to the teacher concerned.

Two thousand seven hundred and seventy-nine certificates

were issued to teachers at Professional Competence in

the 2007/2008 financial year. A further 83 teachers were

granted accreditation at Professional Competence through

mutual recognition with the Victorian Institute of Teaching.

This leads to a total of 4 693 teachers accredited at

Professional Competence since the establishment of

the Institute.

In the first half of 2008, an audit was held of approximately

5 000 teachers who were initially accredited before 1 July

2005 and their respective TAAs. This was to ensure that

all were aware of the requirement to be accredited at

Professional Competence within the stated time frame.

The audit revealed a compliance rate of approximately 94%

with the requirement to submit an Accreditation Report.

Follow-up occurred with non-compliant teachers and their

employers.

2 The Institute is able to extend the maximum period for these teachers in cases of genuine hardship.

1 Teacher accreditation authorities (TAAs) at the point of Professional Competence vary according to system/sector. In government schools they are School Education Directors, in Catholic systemic schools they are usually a senior officer at the Diocesan school office and in independent schools they are usually the principal or the head of school. In some cases, small independent schools have nominated the NSW Association of Independent Schools as their TAA.

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Quality assuraNce oF accreditatioN decisioNs

The Institute does not alter the teacher accreditation

authority’s accreditation decision. The Institute will return

an Accreditation Report to the teacher accreditation

authority only if it breaches the Institute’s guidelines, for

example, the report is based on the Graduate Teacher

Standards instead of the Standards for Professional

Competence.

The Accreditation Reports and documentation are used in a

quality assurance process to ensure that the Standards are

being applied consistently and fairly across the state.

Experienced teachers across all sectors apply to be

external assessors of the Accreditation Reports. These

teachers attend a two day training course. On the first

day of training teachers read cross-sectoral samples of

accreditation reports and establish statewide benchmarks

for their stage or subject area. On the second day, they

review reports received at the Institute in their stage or

subject area.

Following the course, external assessors review

approximately 20 Accreditation Reports a year. It is an aim

of the Institute to cultivate a culture of responsibility for

supporting a quality process by the teaching profession

for the teaching profession. The position of external

assessor is one strategy designed to foster this as well as

providing a quality assurance process for accreditation at

Professional Competence.

Ninety-three external assessors were trained during the

2007/2008 financial year. Three training sessions were held

– in November 2006, March 2007 and June 2007. A total

of 1 724 Accreditation Reports were reviewed during the

financial year. These reviews informed a report to teacher

accreditation authorities concerning the accreditation

process at Professional Competence.

voluNtary accreditatioN at the higher levels

Voluntary accreditation at the higher levels will be

available to all teachers, including “existing teachers3”

for whom accreditation at Professional Competence is

not mandatory.

There are two higher levels in the Professional Teaching

Standards – Professional Accomplishment and

Professional Leadership. The Standards for these levels

were approved by the Minister in May 2006.

Professionally accomplished teachers are highly

skilled and successful practitioners. They are

recognised by other teachers as having in depth

subject knowledge and pedagogy. They keep abreast

of and contribute to professional learning and dialogue

and contribute to the professional learning of others.

They engage in educational and professional

discussions and debates. They recognise their role

in contributing to the professional learning of others

including mentoring beginning teachers.

These teachers are advocates for the profession and

their school. They communicate effectively to diverse

audiences. They interact professionally with the

community.

Professional teacher leaders have a record of

outstanding teaching and are committed to enhancing

the quality of teaching and learning. They are

committed educators who can articulate a vision of

education to their students, peers, the profession and

the wider community.

They may be employed in formal leadership positions

within schools.

They are knowledgeable about the latest

developments in pedagogy and can apply those

developments to unique student contexts. They

have outstanding interpersonal and leadership skills.

These skills are underpinned by principles of fairness,

compassion and integrity.

They recognise the talents of others and promote and

encourage those people to achieve their potential.

They apply critical analysis and problem solving skills

to educational matters.

They engage in professional learning and facilitate

and support the professional learning needs of others,

particularly induction programs for beginning teachers.

They communicate effectively with the community to

support the development of the school and promote

student learning.

The process for accreditation at these two levels

is necessarily more complex than accreditation at

Professional Competence. In addition, the process

requires a different structure to that of accreditation

at Professional Competence.3 Existing teachers are those teachers who possess approved qualifications, who taught in a NSW school prior to October 2004 and have not had a break of five or more years from teaching.

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The key features of the model include:

n a preliminary application to identify those applicants

who have the potential to meet the requirements for

accreditation

n criteria to support the determination of teacher

accreditation authorities

n the identification of multiple sources of evidence,

including observation, through the development of two

evidence guides

n the establishment of a committee to support moderation

of judgement across teacher accreditation authorities.

Teachers will select evidence for their accreditation

submissions based on two evidence guides.

The main sources of evidence described in these guides are:

n documentary evidence – evidence that the teacher has

personally developed or substantially refined

n referee reports – confirmation of the teacher’s

achievement of the Standards by a range of witnesses

n external observation – undertaken by external

observers trained and managed by the Institute

of Teachers.

Each teacher submission and application will be hosted on

the Institute’s website. The teacher will be able to complete

online pro-formas and attach associated evidence to the

pro-formas. Both referees and external observers will

be able to complete online pro-formas to support the

accreditation submission.

The accreditation fees for teachers are derived from costs

arising from the model.

Policies aNd suPPort materials

All NSW schools have a copy of the Teacher Accreditation

Manual. This manual is in a ring binder so that additional

or updated materials may be added to it as they are

developed.

Materials distributed to schools for inclusion in the Manual

during 2007/2008 included:

n Advice for casual, temporary and part-time teachers:

Supporting casual, temporary and part-time teachers to

achieve accreditation at Professional Competence

n Advice for teacher accreditation authorities and

schools: Supporting casual, temporary and part-time

teachers to achieve accreditation at Professional

Competence

An evidence guide specifically designed for casual

teachers was finalised and made available on the

Institute website.

In December 2007, the Minister approved the policy on

minimum English language requirements. The policy

sets minimum levels of proficiency in speaking, listening,

reading and writing for entry into teaching in NSW schools

for teachers whose first language is not English.

Following the signing of a Memorandum of Understanding

with the Victorian Institute of Teaching in 2006/07, a similar

agreement was signed with the Northern Territory. This

agreement allows mutual recognition of registration of

teachers in the Northern Territory and accreditation of

teachers in NSW.

The impact of the Memorandum of Understanding is:

n the graduate teacher qualifications in the Northern

Territory and NSW are regarded as comparable under

this agreement. Teachers who have been provisionally

accredited in NSW are eligible to apply for registration

in the Northern Territory. Teachers who graduate from

an approved teacher education program in the Northern

Territory and are eligible for or hold registration are

eligible to apply for accreditation in NSW

n during the transition period, teachers pay one fee for

accreditation or registration. The receiving jurisdiction

levies fees once the fees from the originating

jurisdiction have lapsed

n teachers need to undergo a Criminal Record Check

and meet the requirements for Child Protection when

applying for employment in either state

n the agreement does not impact on the right of

employers to make their own staffing choices.

Similar agreements are being negotiated with other states’

registration/accreditation authorities (the ACT does not at

present have a comparable body).

Initial Teacher Education

iNitial teacher educatioN Program aPProval Process

Under Section 20 of the Institute of Teachers Act 2004,

the Minister for Education and Training approves programs

of Initial Teacher Education (ITE) against the Graduate

Teacher Standards.

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The Graduate Teacher Standards comprise the knowledge,

skills and capacities required of teachers when they

commence teaching.

The Minister approved the Institute’s Policy and

Procedures for Approval of Initial Teacher Education

Programs in July 2006.

The Policy is designed to ensure that:

n the process of approval ensures a clear and consistent

understanding regarding expectations of initial teacher

education programs

n the approval of ITE programs proceeds effectively and

efficiently to meet NSW legislative requirements.

The Policy provides for the approval of initial teacher

education programs by the Minister on the advice of the

Institute’s Initial Teacher Education Committee (ITEC).

The Initial Teacher Education Committee carries

responsibility on behalf of the Quality Teaching Council

(QTC) to:

n oversee the process of approval of initial teacher

education programs

n identify and manage ITEC panels to review applications

for the approval of programs

n monitor and moderate the process of approval of

programs to support consistency of processes and

outcomes

n investigate and resolve identified areas of concern in

relation to approval of programs

n advise and support teacher education institutions

in relation to the Graduate Teacher Standards and

applications for approval of an initial teacher education

program

n evaluate the impact and usefulness of the Graduate

Teacher Standards for new scheme teachers during

their first year of teaching for the purpose of reflecting

on the initial teacher education experience

n collect data and promote research with a local, national

and international focus in relation to demonstration of

Graduate Teacher Standards

n make recommendations through the Chair of the

Institute to the Minister for approval of programs

n advise the QTC on its work in approving programs and

broad matters related to initial teacher education.

The ITEC is appointed by the QTC for the three year tenure

of the QTC.

Membership of the ITEC comprises:

n three nominees of the QTC

n a representative of the NSW Vice-Chancellors’

Committee

n a representative of a NSW university offering initial

teacher education programs

n at least one representative of the NSW Teacher

Education Council

n three practising teachers with understanding of

professional experience in initial teacher education

programs, ensuring breadth of representation – for

example, primary, secondary, government and non-

government, rural and socio-economic status

n a representative of an employing authority

n the Manager, Initial Teacher Education, or another

member of Institute staff, as executive officer.

The ITEC met on five occasions during 2007/2008.

ITE programs are assessed by panels appointed by the

ITEC on the basis of the Graduate Teacher Standards

and approval is for a maximum of five years. Substantial

changes to a program will require referral to the Institute

for reconsideration.

Each panel includes:

n a school principal or school executive teacher

n two external experts from equivalent initial teacher

education programs

n at least one practising teacher with appropriate

expertise

n an appropriate curriculum specialist with knowledge

of the Board of Studies NSW curriculum

n the Manager ITE, or another member of Institute staff,

as executive officer.

Panel members are drawn from a pool of eligible teachers

and teacher educators. This pool was developed through

advertisements placed in the state press and stakeholder

publications asking for expressions of interest in panel

membership.

During 2007/2008, 12 panels assessed 30 programs of

initial teacher education. Of these 30 programs, five were

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approved by the Minister. Approval is pending for the

remaining programs subject to the successful resolution

of issues raised by the assessment panel.

suPPlemeNtary documeNtatioN - graduate teacher staNdards 1.1.1 – 1.1.3 (subJect coNteNt reQuiremeNts)

In October 2007 the Minister approved detailed advice

for teacher education institutions concerning subject

content requirements including prerequisites for entry

into approved initial teacher education programs.

The documentation:

n summarises and prescribes requirements for study

in both undergraduate and post-graduate teacher

education programs (including prerequisites) for

primary teaching

n summarises and prescribes requirements for study

in both undergraduate and post-graduate teacher

education programs (including prerequisites) for

secondary teaching

n sets out requirements for all subject areas.

Key issues include:

n an enhanced focus on English/literacy for primary, and

HSC entry requirements or university equivalent (Band

4 in Standard English and General Mathematics)

n first and second teaching methods for secondary that

are set at six and four semester units of study

n four years of study as the minimum benchmark for

provisional accreditation

n an alignment between subject descriptions and

employment requirements

suPPlemeNtary documeNtatioN relatiNg to ProFessioNal exPerieNce withiN iNitial teacher educatioN

During 2007/2008 the ITEC developed draft supplementary

documentation advising tertiary institutions of requirements

for professional experience within programs of initial

teacher education.

The draft documentation has been distributed to all

stakeholders including universities for comment and

consultation. It was also available on the Institute’s

website.

The draft policy:

n sets minimum numbers of days of professional

experience for initial teacher education programs

n requires clear links between coursework and

professional experience

n specifies the submission of a minimum of two

professional experience reports based on the Graduate

Teaching Standards

n describes the types of experiences that a student

teacher should undertake during the professional

experience.

The policy will be finalised in 2008/2009.

traNsitioNal aPProval oF curreNt Programs

Consultation with teacher education institutions and other

stakeholders occurred to develop a schedule of proposed

”transitional approvals” of current initial teacher education

programs. This transitional approval provides a defined

timeframe for the review of teacher education programs

and their submission to the Institute for formal approval.

A program’s proposed transitional approval ceases at a

time that accommodates the scheduled assessments by

the panels established under the ITEC.

NatioNal develoPmeNts

The meeting of the Council of Australian Governments

(COAG) on 13 April 2007 agreed to “develop a core set

of nationally-consistent teacher standards for literacy and

numeracy by the end of 2007, accredit university teacher

education courses and register or accredit teachers to

meet these national standards by 2009”.

A COAG working group is considering establishing

standards or requirements for pre-service courses in

literacy, teaching of reading, mathematics and potentially

other areas. If adopted, such requirements will impact on

all approval processes and the preparation of teachers

across the nation. The Institute has taken this possibility

into account in the development of its approval processes.

The COAG decision provides impetus to the work that

the Australasian Teacher Regulatory Authorities (ATRA)

is undertaking in developing an agreement on national

recognition of teaching qualifications. This work is part

of its work plan endorsed by the Ministerial Council on

Education, Employment, Training and Youth Affairs.

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The NSW Institute of Teachers has been particularly

active in this work and the Chief Executive is the ATRA

representative on an Australian Education Systems

Officials Committee working party designed to facilitate

a national ITE accreditation process.

Continuing Professional Development

Sections 7 and 20 of the Institute of Teachers Act 2004

require advice to be provided to the Minister for Education

and Training on the approval of continuing teacher education

providers, courses and programs for the purpose of

accreditation against the Professional Teaching Standards.

The Institute developed a Continuing Professional

Development Policy: Supporting the Maintenance of

Accreditation at Professional Competence to deal with

this section of the Act. The Minister approved this policy

in October 2005.

The policy provides a framework to better support the

allocation of existing resources to meet the needs of

teachers, including the maintenance of accreditation at


Once accredited at Professional Competence, teachers

must undertake a minimum of 100 hours of professional

development over a five year period. Fifty hours of this

must be courses registered with the Institute. The other

fifty hours are identified by individual teachers but must

be linked to the Standards. This is defined as “teacher

identified continuing professional development.

The Minister has delegated to the Chief Executive the

function to approve providers of continuing professional

development. Endorsement of these providers ensures the

quality of courses and programs on offer and guarantees

the capacity of the provider to deliver these programs.

the ProFessioNal learNiNg eNdorsemeNt aNd advisory committee

At the end of 2006 the Institute established the

Professional Learning Endorsement and Advisory

Committee (PLEAC).

The PLEAC works to a plan endorsed by the Quality

Teaching Council (QTC) in December 2006.

The PLEAC’s functions fall into four major areas:

1. advisory

2. endorsement

3. audit

4. deregistration.

1. advisory

The PLEAC provides advice to the QTC in the

following areas:

n support of continuity and coherence between

induction and continuing professional development

for the maintenance of accreditation at the level of

Professional Competence

n research and knowledge in the area of professional

learning

n research regarding the evaluation of continuing


n evaluation of the quality of registered continuing

professional development provision for the purpose of

improved student learning outcomes

n identification of gaps and overlap in the overall

provision of continuing professional development

n brokering for access to courses that support teachers

in achieving the Professional Teaching Standards

n monitoring of teacher input and evaluation data

regarding professional learning

n development and implementation of continuing

professional development awards for providers and

teachers.

2. eNdorsemeNt

The PLEAC is responsible for reviewing the documentation

of providers and making recommendations to the Institute

on their endorsement.

The endorsement functions of the PLEAC are :

n assessment of each submission from providers against

the stated criteria

n provision of advice to providers about their courses and

programs

n monitoring of the provider’s optional self evaluations

13


n provision of recommendations to the QTC for

endorsement

n provision of recommendations for the renewal of

provider endorsement

n provision of recommendations to the QTC for

deregistration of courses or programs where appropriate

3. audit

The audit functions of the PLEAC involve:

n analysis of registration and participation data trends

n analysis of variations between teacher evaluation data

and provider documentation

n audit of a random selection of courses and programs

n oversight of teachers’ claims of participation

n consideration of cases for deregistration

n provision of recommendations to the QTC.

Following acceptance of the recommendations, the

Institute advises the audited providers of the outcome of

the audit. Where a course or program is deficient in any

area, the PLEAC advises the provider of the requirements

for resubmitting their registration.

4. deregistratioN

The PLEAC is responsible for recommending to the QTC

the deregistration of a course or program.

The deregistration process involves:

n consideration by the PLEAC of the evaluation data

for Institute Registered continuing professional

development courses or programs. This applies to a

situation where concerns have been raised regarding

the capacity of the continuing professional development

provision to support teachers in maintaining the

Professional Teaching Standards at the level of


n feedback to the provider regarding the Institute

Registered continuing professional development course

or program revision.

n consideration of the provider’s revision to the Institute

Registered continuing professional development course

or program by the PLEAC.

A review process is available to a provider following

submission of an unsuccessful application. The review is

available to providers only after all attempts to meet the

Institute’s criteria have failed. The review is considered by

the Continuing Professional Development Endorsement

Review Committee. This committee consists of individuals

who are not members of the PLEAC.

Membership of the PLEAC comprises:

n the Manager, Teacher Learning, of the NSW Institute

of Teachers

n three members of the QTC with experience in the

development and delivery of high quality continuing


n one person drawn from each of the government,

Catholic systemic and independent school sectors with

experience in the development and delivery of high

quality continuing professional development

n two experts in the development and delivery of high

quality continuing professional development.

The PLEAC met six times in 2007/08 and recommended

35 continuing professional development providers to

the QTC for endorsement. These providers included the

Professional Teachers’ Council NSW and four Catholic

Education/Schools Offices.

Previously endorsed providers included the NSW

Department of Education and Training, the Association of

Independent Schools of NSW, four Catholic Education/

Schools Offices, and the Department of English and the

Faculty of Education and Social Work of the University of

Sydney.

The work of the PLEAC is ongoing.

Policy oN uNdergraduate aNd Postgraduate studies suPPortiNg the maiNteNaNce oF accreditatioN

The Quality Teaching Council endorsed this policy

in May 2008.

The policy sets the conditions for the contribution

of undergraduate and postgraduate studies to the

maintenance of accreditation.

These conditions include:

n the study must be relevant to the teacher’s area(s) of

teaching or future area(s) of teaching where a teacher

is retraining

n the study must directly contribute to the teacher’s

professional knowledge, practice and commitment

14


n the study must relate directly to one or more

Professional Teaching Standards.

Teachers apply to the Institute for recognition of their

undergraduate/postgraduate studies.

oN-liNe ProFessioNal learNiNg logs

The 2007/08 financial year saw the implementation

of electronic professional learning logs for teachers

accredited at Professional Competence.

After logging into their account, teachers are able to:

n browse Institute Registered courses and programs

using various filters such as provider, stage and

syllabus. Course information includes links to the

provider’s website so that teachers can apply to enrol

in a course or program

n maintain a log of their continuing professional

development. Providers confirm participation in

Institute Registered professional development and

teacher accreditation authorities or their delegates

confirm completion of Teacher Identified professional

development

n view their professional development progress. This

report indicates where requirements have been fulfilled

and where they are still incomplete

n evaluate Institute Registered professional development.

This must occur before participation in a course counts

towards the mandatory hours.

Over 1 000 courses and programs have been registered

and details made available through the teacher account

facility.

maNual For Providers oF coNtiNuiNg ProFessioNal develoPmeNt

In order to support providers of professional development

in gaining endorsed status, the Institute developed

the Manual for Providers of Continuing Professional

Development.

The Manual highlights:

n the role of the Institute of Teachers

n the purpose of endorsement of providers and the

registration of courses and programs

n the steps involved in applying to be an Institute

endorsed continuing professional development provider

n the process for registering courses and programs with

the Institute

n the role of teacher evaluation of Institute registered

continuing professional development

The Manual is distributed to providers who wish to

gain Institute endorsement and is also available on the

Institute’s website.

During 2007/08, the Manual was revised extensively and

distributed to providers of professional development.

coNtiNuiNg ProFessioNal develoPmeNt: maiNtaiNiNg accreditatioN at ProFessioNal comPeteNce – iNFormatioN For teachers

This booklet was developed in 2007/08 for distribution

to teachers accredited at Professional Competence in

2008/09.

The booklet summarises all policies relating to

maintenance of accreditation and provides detailed

instructions (including screen shots) for completing

the on-line professional learning log.

Corporate Services

Subsequent to the proclamation of the Institute of Teachers

Act 2004, significant work was undertaken to establish

administrative and regulatory structures to enable the

Institute to carry out its functions and address its statutory

responsibilities.

During the establishment period, Institute staff worked

closely with Department of Education and Training officers

to implement financial and human resource systems

to ensure compliance with all statutory and legislative

requirements in its employment of staff.

review oF the iNstitute oF teachers act 2004

Section 55 of the Act states:

(1) The Minister is to review this Act to determine whether

the policy objectives of the Act remain valid and

whether the terms of the Act remain appropriate for

securing these objectives.

(2) The review is to be undertaken as soon as

possible after the period of 3 years from the

date of commencement of this Act.

(3) A report on the outcome of the review is to be tabled

in each House of Parliament within 12 months after

the end of the period of 3 years.

15


In conducting the review, staff of the Institute consulted

with the Department Education and Training, Catholic

Education Commission, Association of Independent

Schools, Primary Principals Association, Secondary

Principals Council, Association of Heads of Independent

Schools of Australia, NSW Teachers Federation,

Independent Education Union, Department of Community

Services and Department of Premier and Cabinet. All

stakeholders agree with the recommendations arising from

the review.

The recommendations are for amendments to the Act

dealing with:

1. The definition of “teach” and “teacher” which will

provide the Minister with increased flexibility to address

issues arising from the greater integration of early

childhood in school settings.

2. Revocation of accreditation on general grounds. There

is currently no provision within the Act to allow for

the revocation of a teacher’s accreditation across all

schools, in particular casual and temporary teachers.

The amendments allow also for suspension of

accreditation and reinstatement as a consequence of

legal appeal.

3. A general capacity to charge fees. The current Act does

not allow the Institute to charge for services such as for

the endorsement of professional development providers

as envisaged in the establishment of the Institute.

4. A capacity for employers to dismiss or to suspend

without pay teachers who do not meet the conditions

of their accreditation. The Department of Education

and Training is currently only able to suspend teachers

on full pay, where for instance, they refuse to pay

accreditation fees.

5. The definition of returning teacher. The definition of

returning teacher is to be amended to refer to absence

from paid employment. Some teachers are able to

avoid the need to up-skill on return to employment

because they are considered to be employed even

though they have been on extended leave for up to 10

years.

6. Deferment of the requirement for elected members

of Council to be accredited. The timeframe for

implementing accreditation at higher levels has

restricted the availability of accreditation for

experienced teachers.

7. A further review of the Act after five years.

The Report and recommendations will be discussed in the

2008 Spring Session of Parliament.

The passage of the amendments will allow the Institute to

more effectively achieve its objective of supporting teacher

quality in NSW.

board oF goverNaNce aNd Quality teachiNg couNcil

The Minister for Education and Training appointed a new

Chair, Professor Philip Foreman, in November 2007.

The Minister also extended the terms of the three

appointed Board members another three years to

December 2010.

The Board met three times during the 2007/08 financial

year. Meeting dates were as follows:

n 26 September 2007

n 4 December 2007

n 27 February 2008

The Board oversees and endorses the Institute’s budget,

internal audit processes, risk management policy, the

Strategic Plan, and associated strategies such as the

Technology Strategic Plan.

With regard to the Quality Teaching Council, Mr Angelo

Gavrielatos, the nominee of the NSW Teachers Federation,

resigned in January 2008 and was replaced by Mr Robert

Lipscombe.

The Council met five times during the 2007/08 financial

year. Meeting dates were as follows:

n 25 October 2007

n 3 December 2007

n 11 March 2008

n 8 May 2008

n 17 June 2008

The Council oversees and endorses the major activities

described under Standards and Accreditation, Initial

Teacher Education and Professional Learning.

coNsumer resPoNse

The Institute operates an enquiry line – 1300 739 338 –

and an email facility [email protected]

which are well patronised by accredited teachers, teacher

employers and professional organisations. All enquiries are

dealt with by policy officers.

16


The electronic Teacher Accreditation Management System

allows each contact to be logged onto the database and

treated as a case. The system allows each case to be

directed to and carried out by the most appropriate officer.

Emails are attached to the file of the relevant teacher,

as are the replies. Mailed correspondence is scanned

into a teacher’s file and the replies are also electronically

connected to the relevant file.

PROMOTION

The Institute has distributed a number of publications to

accredited teachers, schools and teacher accreditation

authorities in NSW. In 2007/2008 these included:

n The Digest – focussing on current research on a single

education issue

n The Knowledge – contemporary issues in education

n Teacher Magazine – produced by the Australian

Council for Education Research and included a

customised section for all Institute accredited teachers

The Institute has developed an update to the Teacher

Accreditation Manual to cover accreditation at the levels of

Professional Accomplishment and Professional Leadership

(for distribution August 2008).

Additionally, the Institute has begun a sponsorship program

offering commercial opportunities to advertise on the

website, and for promotional material to be included in

specific Institute mailouts.

On initial accreditation, all teachers receive a welcome

letter, a copy of the Professional Teaching Standards,

the booklet Information for New Scheme Teachers and

a brochure Advice for casual temporary and part-time

teachers.

All teachers accredited at Professional Competence

receive a certificate signed by the Chair and the relevant

teacher accreditation authority. They also receive an

information pamphlet Your Continuing Professional

Development which summarises the requirements for

maintaining accreditation at Professional Competence.

All accredited teachers receive an accreditation card on

payment of the annual accreditation fee.

The Institute maintains a website at

www.nswteachers.nsw.edu.au. All news items, legislation,

policies, support documents and reports are published

on the website. It received a major upgrade in 2006/07,

performed by the Blue Arc Group.

There is also an email facility

[email protected]. This is a major

source of enquiries to the Institute.

No overseas visits were undertaken by the NSW Institute

of Teachers in 2007/2008.

Institute staff gave over 80 presentations to teachers,

teacher employers and consultants across NSW.

GOVERNMENT POLICIES AND REQUIREMENTS

Legislative Changes

In April 2008, the Executive Council approved an

amendment to the Institute of Teachers Regulation 2005

which increased the annual accreditation fee from $88 to

$92.00. This increase was in line with the increase in the

Annual Government Schools Recurrent Cost, which is the

major cost factor operating on the Institute’s finances.

Staffing

As at 30/6/08, 24.4 positions were filled. There are 10.8

unfilled positions. Casual support staff is employed on a

needs basis.

An organisation chart is attached at Appendix One.

Filled positions as at 30 June are:

Category Number

SES Level Four 1.2

Senior Officer Level 3 3 (two temporary

positions)

Senior Officer Level 2 1

Chief Education Officer 2 (both temporary

positions)

Senior Education Officer 7

2/Clerk 11/12

Senior Education Officer 2

1/Clerk 9/10

Clerk 7/8 2.2

Clerical Officer 7/8 1

Clerk 5/6 2

Clerical Officer 5/6 3

17


Of the 5.2 executive officer positions, in 2007/08, one was

female. In 2006/07, two positions out of five were female.

Consultants

oN-liNe PrelimiNary aPPlicatioN For ProFessioNal accomPlishmeNt aNd ProFessioNal leadershiP

The Institute awarded the contract to Educational

Assessment Australia, attached to the University of NSW.

The purpose was to develop on-line preliminary application

forms for accreditation at Professional Accomplishment and

Professional Leadership that would give a clear indication

if an applicant had the potential to achieve accreditation at

the higher levels.

Cost: $34 818 plus GST.

the digest

The Australian Council for Educational Research (ACER)

has been commissioned to develop periodic digests of

current research, each focused on a single issue. Two

digests were made available electronically in 2007/08 to

accredited teachers. The first dealt with writing to learn and

the second with behaviour management.


teacher magaziNe

In 2008, all accredited teachers in NSW received a free

copy of Teacher, the ACER’s regular publication with a

tailored NSW supplement. A copy of the current issue

(again with a specific NSW supplement) is distributed

to newly accredited teachers with their welcome packs.

Teachers are able to subscribe to the magazine at a

heavily discounted price.


modiFicatioNs to the electroNic teacher accreditatioN maNagemeNt system (etams)

(i) Application process for accreditation at the

higher levels

The Blue Arc Group was contracted to enable on-line

applications for accreditation at the higher levels. This

includes the preliminary application and the full application.

It involves managing accreditation application forms,

referee and external observer validations, triggering of

workflows and access by teacher accreditation authorities.


(ii) Professional development learning logs

Orion was contracted to complete the work on teachers’

on-line learning logs enabling the process for maintenance

of accreditation at Professional Competence.


iNterNal audit

IAB Services was contracted to perform an internal audit.

Cost $17 600 plus GST.

18


Payment of Accounts

Schedule of Accounts

Paid on Time

Qtr Ended

Sep-07

$’000

Qtr Ended

Dec-07

$’000

Qtr Ended

Mar-08

$’000

Qtr Ended

Jun-08

$’000

Total Accounts Paid 168 112 98 104

% accounts paid on time 100% 100% 100% 100%

Risk management and insurance activities

The Board endorsed a risk management policy which was

implemented in 2006.

In 2007/08 the Institute of Teachers participated in the

Treasury Managed Fund through the Department of

Education and Training.

Disability plan

The Institute has developed its disability plan which

includes ensuring that the Professional Teaching Standards

covers the education of students with a disability.

Privacy management plan

The Institute collects and holds comprehensive information

concerning accredited teachers which is detailed in the

Institute of Teachers Regulation 2005.

During 2005/2006 the Institute developed and implemented

a Privacy Statement.

The Privacy Statement was adhered to by all staff and no

Part 5 section 53 review under the Privacy and Personal

Information Protection Act 1998 was required in 2007/08.

Occupational health and safety

One workplace accident occurred during 2007/08.

Freedom of Information

The Institute received one request for information under the

Freedom of Information Act 1989 in 2007/08. It is currently

being processed.

Energy management and electronic service delivery

The Institute completed its NSW Government Waste and

Reduction and Purchasing Policy return and forwarded it to

the Department of Environment and Conservation (NSW).

The Institute:

n uses its website as its main means of publication

n encourages the use of email in communicating with

teachers and teacher accreditation authorities

n uses power stand-by on photocopiers and facsimile

machines.

The Research Digest is delivered electronically.

Exemptions

As a small statutory body, the Institute need only report

on equal employment opportunity, ethnic affairs priority

statement and waste triennially. These were reported on in

2006/07.

19


Budget Summary

Institute of Teachers Estimate Estimate

Draft Budget 2007/2008 2008/2009

REVENUE

Total Government funding 3,215,460 2,186,513

Other income, fees and charges 2,357,552 2,676,592

Crown Advance

TOTAL REVENUE 5,573,012 4,863,105

EXPENSES

Personnel Services 3,668,943 3,891,845

Expenses by cost centre

General Expenses 1,218,635 1,342,015

Corporate Services 56,000 315,635

Standards & Accreditation 445,050 465,290

Initial Teacher Education 265,000 215,600

Professional Learning 71,600 73,296

TOTAL EXPENSES 5,725,228 6,303,681

Net Budget Surplus/(Deficit) (152,216) (1,440,576)

ACCUMULATED RESERVES/DEFICIT 5,104,611 6,440,298


20

21


22


23

FINANCIAL STATEMENTS 2007-2008

Contents

1. Consolidated Report for the NSW Institute of Teachers and the Office of the Institute of Teachers

Statement by the Executive of the NSW Institute of Teachers 24

Income Statement 25

Balance Sheet 26

Cash Flow Statement 27

Statement of Recognised Income and Expenditure 28

Notes to the Financial Statements 29

2. Office of the Institute of Teachers

Statement by the Executive of the NSW Institute of Teachers 52

Income Statement 53

Balance Sheet 54

Cash Flow Statement 55

Statement of Recognised Income and Expenditure 56

Notes to the Financial Statements 57

24



STATEMENT BY THE EXECUTIVE OF THE NSW INSTITUTE OF TEACHERS

Pursuant to the Section 41c (1b) and (1c) of the Public Finance and Audit Act, 1983 and in our

capacity as Chair and Member of the Board of Governance, NSW Institute of Teachers, we declare

that in our opinion:

1. The accompanying financial report exhibits a true and fair view of the financial position of the

NSW Institute of Teachers as at 30 June 2008 and transactions for the year then ended.

2. The report has been prepared in accordance with the provisions of the Public Finance and Audit

Act, 1983, the Public Finance and Audit Regulation 2005, and the Treasurer’s Directions.

Further, we are not aware of any circumstances, which would render any particulars included in the

financial report to be misleading or inaccurate.


Chair Member


25


Income Statement For the year ended 30 June 2008

NSW Institute

Consolidated of Teachers

2008 2007 2008 2 0 0 7

Notes $’000 $’000 $’000 $’000

INCOME

Grants and contributions 2(a) 3,280 4,176 3,280 4,176

Accreditation fees 2(b) 1,843 1,285 1,843 1,285

Other 2(c) 549 481 549 481

Total Income 5,672 5,942 5,672 5,942

EXPENSES

Salaries and wages 3 3,389 2,126 - -

Personnel services 4 - - 3,389 2,126

Other operating expenses 5 1,419 1,258 1,419 1,258

Auditors remuneration 16 47 48 47 48

Depreciation and amortisation 8 149 69 149 69

(Gain)/Loss on sale of asset - 5 - 5

Maintenance 1(o) 15 9 15 9

Total Expenses 5,019 3,515 5,019 3,515

Surplus/(Deficit) for the year 16/20(b) 653 2,427 653 2,427

The accompanying notes form part of these statements

26


Balance Sheet As at 30 June 2008

NSW Institute


2008 2007 2008 2007

Notes $’000 $’000 $’000 $’000

ASSETS

Current Assets

Cash and cash equivalents 6 7,829 7,030 7,829 7,030

Receivables 7 2,380 2,217 1,614 1,612

Total Current Assets 10,209 9,247 9,443 8,642

Non-Current Assets

Leasehold improvements 9 233 - 233 -

Plant, furniture and equipment 9 303 110 303 110

Intangible assets 10 300 129 300 129

Other 11 62 55 - -

Total Non-Current Assets 898 294 836 239

TOTAL ASSETS 11,107 9,541 10,279 8,881

LIABILITIES

Current Liabilities

Payables 12 253 328 253 328

Accreditation fees in advance 12 1,084 832 1,084 832

Provisions for personnel services 12 - - 1,129 583

Provisions for employee entitlements 12 1,185 956 - -

Deferred income 22 - 22 -

Total Current Liabilities 2,544 2,116 2,488 1,743

Non-Current Liabilities

Provision for Employee Benefits 13 772 287 - -

Total Non-Current Liabilities 772 287 - -

TOTAL LIABILITIES 3,316 2,403 2,488 1,743

NET ASSETS 7,791 7,138 7,791 7,138

EQUITY

Accumulated Funds 15 7,791 7,138 7,791 7,138

Total Equity 7,791 7,138 7,791 7,138


27


Cash Flow Statement For the year ended 30 June 2008

NSW Institute


2008 2007 2008 2 0 0 7

Notes $’000 $’000 $’000 $’000

Cash Flows from Operating Activities

Receipts

Cash flows from Government 3,280 4,176 3,280 4,176

Accreditation fees 1,368 516 1,368 516

Other 549 481 549 481

Payments

Suppliers and Employees (3,652) (3,343) (3,652) (3,343)

Net Cash Provided by/(Used in) Operating Activities 19(b) 1,545 1,830 1,545 1,830

Cash Flows from Investing Activities

Purchases

Leasehold Improvements, Plant, Equipment and Furniture (533) (33) (533) (33)

Intangible Assets (213) (133) (213) (133)

Net Cash Provided by/(Used in) Investing Activities (746) (166) (746) (166)

Cash Flows from Financing Activities

Cash flows from financing activities - - - -

Net Cash Provided by/(Used in) Financing Activities - - - -

NET INCREASE/(DECREASE) IN

CASH AND CASH EQUIVALENTS 799 1,664 799 1,664

CASH AND CASH EQUIVALENTS AT

BEGINNING OF FINANCIAL YEAR 7,030 5,366 7,030 5,366

CASH AND CASH EQUIVALENTS AT

END OF FINANCIAL YEAR 19(a) 7,829 7,030 7,829 7,030


28


Statement of Recognised Income and Expense For the year ended 30 June 2008

NSW Institute


2008 2007 2008 2007

Notes $’000 $’000 $’000 $’000

Total Income and Expense

Recognised Directly in Equity - - - -

Surplus/(Deficit) for the Year 653 2,427 653 2,427

TOTAL INCOME AND EXPENSE

RECOGNISED FOR THE YEAR 15 653 2,427 653 2,427


29


Notes to the Financial Statements For the year ended 30 June 2008

1. SUMMARY OF ACCOUNTING POLICIES

a) Reporting Entity

The NSW Institute of Teachers (the Institute) was

constituted under the Institute of Teachers Act 2004

from 1 July 2004. Schedule 2 of the Public Finance and

Audit Act 1983 designates the Institute as a statutory

body for reporting purposes.

The Institute, as a reporting entity, comprises all

entities under its control, namely the Office of the

Institute of Teachers (the Office).

The Office is a division of the Government Service,

established pursuant to Schedule 1 to the Public Sector

Employment and Management Act 2002. The objective

of the Office is to provide personnel services to the

NSW Institute of Teachers.

In the process of preparing the consolidated financial

report of the Institute and the Office, all inter-entity

transactions and balances have been eliminated. The

Institute is a not-for-profit entity (as profit is not its

principal objective), with no cash generating units.

This consolidated financial report for the year ended 30

June 2008 has been authorised for issue by the Board

of Governance on 20 October 2008.

b) Basis of preparation

The historical cost convention has been used to

prepare the financial statements unless otherwise

stated.

The financial report of the Institute is a general purpose

financial report prepared in accordance with:

n applicable Australian Accounting Standards, which

includes Australian Accounting Interpretations;

n the requirements of the Public Finance and Audit

Act 1983 and Public Finance and Audit Regulation

2005, and

n the financial reporting directions issued by the

Treasurer.

Judgements, key assumptions and estimates

management has made are disclosed in the relevant

notes to the financial report.

All amounts are rounded to the nearest one thousand

dollars and are expressed in Australian currency.

c) Assets

The Institute shows Leasehold improvements, plant &

equipment, furniture and fittings (Note 9) at historic cost

less accumulated depreciation. This approximates the

fair value of these assets.

The Institute recognises intangible assets only if it is

probable that future economic benefits will flow to the

Institute and the cost of the asset can be measured

reliably. Intangible assets are measured initially at cost.

Where an asset is acquired at no or nominal cost, the

cost is its fair value as at the date of acquisition.

Intangible assets are subsequently measured at fair

value only if there is an active market. As there is

no active market for the Institute’s intangible assets,

the assets are carried at cost less any accumulated

amortisation.

d) Acquisition of assets

The cost method of accounting is used for the initial

recording of all acquisition of assets controlled by

the Institute. Cost is the amount or cash equivalents

paid or the fair value of the other consideration given

to acquire the asset at the time of its acquisition or

construction or, where applicable, the amount attributed

to that asset when initially recognised in accordance

with the requirements of Australian Accounting

Standards.

e) Capitalisation thresholds

Assets costing $500 and above individually or

forming part of a network costing more than $500 are

capitalised.

f) Depreciation and amortisation

The Institute depreciates or amortises non-current

assets on a straight line basis over their estimated

useful life and over the term of the lease. The rates

used are:

n Computer Hardware 20% to 33.3%

n Office Equipment 20%

n Intangible Assets - Software 20%

n Furniture and Fittings 10%

n Leasehold Improvements 20.3%

30



g) Impairment of plant, furniture and equipment

As a not-for-profit entity with no cash generating units,

the Institute is effectively exempted from AASB 136

Impairment of Assets and impairment testing. This is

because AASB 136 modifies the recoverable amount

test to the higher of fair value less costs to sell and

depreciated replacement cost. This means that, for an

asset already measured at fair value, impairment can

only arise if selling costs are material. Selling costs are

regarded as immaterial.

h) Goods and Services Tax (GST)

Revenues, expenses and assets are recognised net of

GST except:

i) where the amount of GST incurred is not

recoverable from the Australian Taxation Office

(ATO), it is recognised as part of the acquisition

cost of an asset or as part of an item of expense; or

ii) for receivables and payables which are recognised

inclusive of GST.

The net amount of GST recoverable from, or payable to,

the ATO is included as part of receivables or payables.

Cash flows are included in the cash flows statement

on a gross basis. The GST component of cash flows

arising from investing and financing activities which is

recoverable from, or payable to, the ATO is classified

as operating cash flows.

i) Income Recognition

Income is measured at the fair value of the

consideration or contribution received or receivable.

Additional comments regarding the accounting policies

for the recognition of income are discussed below.

i) graNts aNd coNtributioNs

Grants and contributions are recognised as revenue

when the Institute obtains control over the assets

comprising the grants or contributions. Control over

grants and contributions is normally obtained upon

receipt of cash.

ii) aNNual accreditatioN Fees

Annual accreditation fees cover the period 1 January

to 31 December. Only those fees that are attributable

to the current financial year are recognised as revenue.

Fees that relate to future periods are shown in the

Balance Sheet as Accreditation fees in advance under

current liabilities.

iii) iNvestmeNt iNcome

Interest revenue is recognised using the effective

interest method as set out in AASB 139 Financial

Instruments: Recognition and Measurement.

j) EmployeeBenefitsandotherprovisions

i) salaries aNd wages, aNNual leave, sick leave aNd oN costs

Liabilities for salaries are calculated at nominal amounts

based on the amounts expected to be paid when liabilities

are settled. Annual leave is recognised and measured in

respect of employees’ services up to the reporting date at

nominal amounts based on the amounts expected to be

paid when the liabilities are settled.

The outstanding amounts of payroll tax, workers’

compensation insurance premiums and fringe benefits

tax, which are consequential to employment, are

recognised as liabilities and expenses where the

employee benefits to which they relate have been

recognised.

ii) loNg service leave aNd suPeraNNuatioN

Long Service Leave

The Office makes contributions to the non-budget long

service leave pool for its long service leave obligations,

in accordance with NSWTC 04/02. The contributions are

recognised as an expense. The nominal value of long

service leave at reporting date is recognised as a liability

and equivalent asset in the Balance Sheet. Long service

leave payments to the employees are made by the Office,

and the Office subsequently receives reimbursement from

the Pool, for all payments made to employees.

Long service leave entitlements have been valued

using the short-hand method to approximate present

value, based on employees with five or more years’

service. An actuarial review conducted by Treasury

(Circular 07/4) indicated that it is unlikely that the

difference between the present value and the nominal

value will be material.

Definedcontributionsuperannuationscheme

The Office contributes to defined contribution

superannuation schemes in accordance with

Superannuation Guarantee Contribution legislation

and Public Sector Employment and Management Act

2002. Obligations for contributions to these schemes

are recognised as an expense in the Income Statement

as incurred. The liability recognised at balance date

represents the contribution to be paid in the following

month.

31



Definedbenefitssuperannuationscheme

Pillar Administration advises the Office of the

level of liability for the Office’s superannuation

commitments to its employees who are members of

the various divisions of the scheme. The calculation

of the superannuation position is based on actuarial

reviews independent of the Office’s ongoing activities

and involvement. The main drivers of the actuarial

calculations are the level of investment return, salary

inflation and CPI increases.

The Office has an obligation for the deferred benefits

contribution which becomes payable on and after

retirement of staff. Contribution is made to the State

Superannuation Scheme (SSS), the State Authorities

Superannuation Scheme (SASS) and the State

Authorities Non-Contributory Superannuation Scheme

(SANCS). The SAS Trustee Corporation through the

Fund’s actuary has determined that the unfunded

superannuation liability as at 30 June 2008 for SSS

and SASS was estimated at $772 (2007: unfunded

superannuation liability $288). Prepaid superannuation

contributions for SANCS was estimated to be $62

(2007: prepaid superannuation contributions $55).

Amounts representing prepaid superannuation

contributions are recognised as an asset. Amounts

representing unfunded superannuation are recognised

as a liability. At balance date, the net increase in

unfunded contributions from the previous year has

been recognised as superannuation expense.

iii) other ProvisioNs

Other provisions exist when the Institute has a present

legal or constructive obligation as a result of a past

event; it is probable that an outflow of resources will be

required to settle the obligation; and a reliable estimate

can be made of the amount of the obligation.

All of the Institute’s personnel service arrangements

are provided by the Office.

k) Insurance

The Institute’s insurance activities are conducted

through the NSW Treasury Managed Fund Scheme of

self insurance for Government agencies. The expense

(premium) is determined by the Fund Manager on past

claim experience.

l) Receivables and Payables

Receivables are non-derivative financial assets with

fixed or determinable payments that are not quoted in

an active market.

Payables represent liabilities for goods and services

provided to the agency and other amounts.

Receivables and payables are recognised initially at

fair value, usually based on the transaction cost or face

value.

Subsequent measurement is at amortised cost using

the effective interest method, less an allowance for

any impairment of receivables. Any changes are

accounted for in the Income Statement when impaired,

derecognised or through the amortisation process.

Short-term receivables and payables with no stated

interest rate are measured at the original invoice

amount where the effect of discounting is immaterial.

m) Allowance for impairment of debts

Collectability of trade receivables is reviewed on

an ongoing basis. Debts, which are known to be

uncollectable are written off in the period in which they

are identified. An allowance for impairment of debt is

established when there is objective evidence that the

Institute may not be able to collect all amounts due

according to the original terms of receivables. Trade

receivables generally settled within 29 days are carried

at amount due.

n) Financial Instruments

Financial Instruments give rise to positions that are a

financial asset of either the Institute or its counterparty

and a financial liability of the other party. For the

Institute, these include cash at bank, receivables

and creditors. Note 21 discloses the relevant risk of

financial instruments. We record classes of instruments

at cost and carry them at net fair value.

o) Maintenance

Day-to-day servicing costs or maintenance are charged

as expenses as incurred, except where they relate to

the replacement of a part or component of an asset, in

which case the costs are capitalised and depreciated.

In 2008, maintenance costs totalled $15.4 (2007: $9.3).

p) Comparative Information

Except when an Australian Accounting Standard

permits or requires otherwise, comparative information

is disclosed in respect of the previous period for all

amounts reported in the financial statements.

32



Consolidated The Institute

2008 2007 2008 2007

$’000 $’000 $’000 $’000

2. INCOME

(a) Grants and contributions

Grant from the Department of Education and Training 3,280 4,176 3,280 4,176

(b) Accreditation Fees

Annual Fees 2,086 1,440 2,086 1,440

Bad Debt Expense (243) (155) (243) (155)

1,843 1,285 1,843 1,285

(c) Other Income

Interest 545 472 545 472

Miscellaneous 4 9 4 9

549 481 549 481

3. EMPLOYEE RELATED EXPENSES

Salaries and Wages 2,176 1,736 - -

Superannuation – defined benefit plans 686 104 - -

Superannuation – defined contribution plans 138 84 - -

Annual Leave 205 58

Long Service Leave 67 60 - -

Payroll Tax 117 84 - -

3,389 2,126 - -

4. PERSONNEL SERVICES

Personnel Services - - 3,389 2,126

- - 3,389 2,126

5. OTHER OPERATING EXPENSES

Bank Fees 12 5 12 5

Books/Publications 5 5 5 5

Insurance - 13 - 13

Meetings 12 9 12 9

Fees for Services Rendered1 520 590 520 590

Rent and Cleaning 286 295 286 295

Teaching Relief 50 34 50 34

Travelling 78 88 78 88

Stores 61 34 61 34

1 Fees for Services Rendered includes reimbursement to Department of Education and Training for salary and on costs of seconded staff.

33




2008 2007 2008 2007

$’000 $’000 $’000 $’000

5. OTHER OPERATING EXPENSES (cont’d)

Printing 179 76 179 76

Telephone and Postage 148 53 148 53

Electricity 15 17 15 17

Computer Software 4 - 4 -

QTC and Board Expenses 45 31 45 31

Other General Expenses 4 4 4 4

1,419 1,258 1,419 1,258

6. CURRENT ASSETS-CASH AND CASH EQUIVALENTS

Cash at bank and on hand 7,829 7,030 7,829 7,030

7,829 7,030 7,829 7,030

7. CURRENT ASSETS-RECEIVABLES

Australian Taxation Office 69 60 69 60

NSW Treasury long service leave Receivable 766 636 - 31

Fees Receivable 1,784 1939 1,784 1,939

Allowance for Impairment of debts (250) (418) (250) (418)

Prepayments 11 - 11 -

2,380 2,217 1,614 1,612

8. DEPRECIATION AND AMORTISATION

Leasehold improvements, plant, furniture and equipment 107 47 107 47

Intangible assets 42 22 42 22

149 69 149 69

34



9. NON-CURRENT ASSETS – PROPERTY, PLANT AND EQUIPMENT

Leasehold Computer &

Improve- Plant & Related Furniture

ments Equipment Equipment & Fittings Total

As at 1 July 2007 $’000 $’000 $’000 $’000 $’000

Gross Carrying Amount - 63 96 49 208

Accumulated depreciation - (29) (55) (14) (98)

Net Carrying Amount – at fair value - 34 41 35 110

At 30 June 2008

Gross Carrying Amount 273 133 142 193 742

Accumulated depreciation (40) (45) (91) (29) (205)

Net Carrying Amount – at fair value 233 88 51 164 536

PROPERTY, PLANT AND EQUIPMENT - RECONCILIATIONS

A reconciliation of the carrying amounts of each class of property, plant and equipment at the beginning and end of the current

year is set out below.




$’000 $’000 $’000 $’000 $’000

Net Carrying amount at 1 July 2007 - 34 41 35 110

Additions 273 70 46 144 534

Disposals - - - - -

Depreciation expense (40) (16) (36) (15) (107)

Net Carrying amount as at 30 June 2008 233 88 51 164 536




$’000 $’000 $’000 $’000 $’000

Carrying amount at 1 July 2006 - 39 55 38 132

Additions - 16 15 2 33

Disposals - (8) - - (8)

Depreciation expense - (13) (29) (5) (47)

Net Carrying amount as at 30 June 2007 - 34 41 35 110

35



10. NON-CURRENT ASSETS – INTANGIBLE ASSETS

Software

$’000

At 1 July 2007

Cost (gross carrying amount) 157

Accumulated amortisation and impairment (28)

Net Carrying Amount at fair value 129

At 30 June 2008

Cost (gross carrying amount) 369

Accumulated amortisation and impairment (69)

Net Carrying Amount at fair value 300

INTANGIBLE ASSETS - RECONCILIATION

A reconciliation of the carrying amounts of intangible assets at the beginning and end of the current year is set out below.

Software

$’000

Carrying amount at 1 July 2007 129

Additions 212

Disposals -

Amortisation expense (41)

Carrying amount as at 30 June 2008 300

Software

$’000

Carrying amount at 1 July 2006 19

Additions 133

Disposals -

Amortisation expense (23)

Carrying amount as at 30 June 2007 129

36




2007 2006 2007 2006

$’000 $’000 $’000 $’000

11. OTHER NON-CURRENT ASSETS

Prepaid superannuation contributions 62 55 - -

62 55 - -

12. CURRENT LIABILITIES – PAYABLES

Accounts payable 253 328 253 328

Accrued wages, salaries and oncosts 14 10 - -

Accreditation fees in advance 1,084 832 1,084 832

Annual leave provision 305 262 - -

Long service leave provision 766 605 - -

Annual and long service leave on costs provision 100 79 - -

Personnel services liability - - 1,129 583

Deferred income 22 - 22 -

2,544 2,116 2,488 1,743

13. NON-CURRENT LIABILITIES – PROVISION FOR EMPLOYEE BENEFITS

Unfunded superannuation liability 772 287 - -

772 287 - -

14. DEFINED BENEFIT SUPERANNUATION PLANS

An Actuarial assessment of the superannuation schemes as at 30 June 2008 was carried out by the Fund’s actuary in

accordance with AASB 119 Employee Benefits.

Details are as below:

Fund Assets

The percentages invested in each asset class at the balance sheet dates are:

30 June 2008 30 June 2007

Australian equities 31.6% 33.6%

Overseas equities 25.4% 26.5%

Australian fixed interest securities 7.4% 6.8%

Overseas fixed interest securities 7.5% 6.4%

Property 11.0% 10.1%

Cash 6.1% 9.8%

Other 11.0% 6.8%

37



Positionstatementforeachdefinedbenefitsuperannuationplan

Financial Year to 30 June 2008 SASS SANCS SSS TOTAL

Member Numbers

Contributors 2 6 4

Deferred benefits 0 0 0

Pensioners 0 0 0

Pensions fully commuted 0 0 0

Superannuation Position for AASB 119 purposes $’000 $’000 $’000 $’000

Accrued liability 502 267 3,058 3,827

Estimated reserve account balance (488) (329) (2,301) (3,118)

14 (62) 757 709

Future Service Liability2 (236) (91) (97) (424)

Surplus in excess of recovery available from schemes 0 0 0 0

Net (asset)/liability to be recognised in balance sheet 14 (62) 757 709



Member Numbers

Contributors 2 6 4


Pensioners 0 0 0





(24) (31) 288 232



Net (asset)/liability to be recognised in balance sheet (24) (31) 288 232

2 The Future Service Liability (FSL) does not have to be recognised by an employer. It is only used to determine if an asset ceiling limit should be imposed (AASB 119, para 58). Under AASB 119, any prepaid superannuation asset recognised cannot exceed the total of any unrecognised past service cost and the present value of any economic benefits that may be available in the form of refunds from the plan or reductions in future contributions to the plan. Where the “surplus in excess of recovery” is zero, no asset ceiling limit is imposed.

38



Reconciliation of the assets and liabilities recognised in the balance sheet

Financial year to 30 June 2008 SASS SANCS SSS Total

$’000 $’000 $’000 $’000

Present value of partly funded

defined benefit obligations at end of year 503 267 3,058 3,828

Fair value of fund assets at end of year (488) (329) (2,301) (3,118)

Subtotal 14 (61) 757 710

Unrecognised past service cost 0 0 0 0

Unrecognised gain/(loss) 0 0 0 0

Adjustment for limitation on net asset 0 0 0 0

Net Liability/(Asset) recognised in

balance sheet at end of year 14 (62) 757 709


$’000 $’000 $’000 $’000

Present value of partly funded defined

benefit obligations at end of year 461 239 2,723 3,423


Subtotal (24) (31) 288 233




Net Liability/(Asset) recognised in

balance sheet at end of year (24) (31) 288 233

Expense recognised in income statement


$’000 $’000 $’000 $’000

Components Recognised in Income Statement

Current service cost 23 13 42 78

Interest cost 29 15 174 218

Expected return on Fund assets (net of expenses) (37) (21) (187) (245)

Actuarial losses/(gains) recognised in year 52 52 530 634

Past service cost 0 0 0 0

Movement in adjustment for limitation on net asset 0 0 0 0

Curtailment or settlement (gain)/loss 0 0 0 0

Expense/(income) recognised 67 60 560 687

39




$’000 $’000 $’000 $’000





Actuarial losses/(gains) recognised in year 86 21 (32) 75




Expense/(income) recognised 89 24 (12) 101

Expected rate of return on assets

The expected return on assets assumption is determined by weighting the expected long-term return for each asset class by

the target allocation of assets to each class. The returns used for each class are net of investment tax and investment fees.

Actual Return on Fund Assets

SASS SANCS SSS

$’000 $’000 $’000

Financial year to 30 June 2008

Actual return on Fund assets (33) (22) (157)


Actual return on Fund assets 47 32 288

a) Valuation Method and principal assumptions at the balance sheet date

The Projected Unit Credit (PUC) valuation method was used to determine the present value of the defined benefit obligations

and the related current service costs. This method sees each period of service as giving rise to an additional unit of benefit

entitlement and measures each unit separately to build up the final obligation.

40



b) Economic Assumptions

30 June 2008 30 June 2007

Salary increase rate (excluding 4.0% pa to June 2008,

promotional increases) 3.5% pa 3.5% pa thereafter

Rate of CPI Increase 2.5% pa 2.5%pa

Expected rate of return on assets backing current Pension liabilities 8.3% 7.6%

Expected rate of return on assets backing other liabilities 7.3% 7.6%

Discount rate 6.55% pa 6.4% pa

Historical information

Financial year to 30 June 2008 SASS SANCS S S S

$’000 $’000 $’000

Present value of defined benefit obligation 503 267 3,058

Fair value of Fund assets (488) (329) (2,301)

(Surplus)/Deficit in Fund 14 (62) 757

Experience adjustments – Fund liabilities (13) 9 269

Experience adjustments – Fund assets 65 (43) 261

Financial year to 30 June 2007 SASS SANCS S S S

$’000 $’000 $’000



(Surplus)/Deficit in Fund (24) (31) 288

Experience adjustments – Fund liabilities 193 39 249

Experience adjustments – Fund assets (107) (18) (281)

Expected contributions

SASS SANCS S S S

$’000 $’000 $’000

As at 30 June 2007

Expected employer contributions 0 0 0

As at 30 June 2008


41


Disclosures required under paragraph Aus121.1 and Aus121.2

Aus121.1 Funding arrangements for employer contributions

(a) Surplus/deficit

The following is a summary of the 30 June 2008 financial position of the Fund calculated in accordance with AAS 25 “Financial

Reporting by Superannuation Plans”:

As at 30 June 2008 SASS SANCS SSS

$’000 $’000 $’000

Accrued benefits 505 268 2,906

Net market value of Fund assets (488) (329) (2,301)

Net(surplus)/deficit 17 (61) 605


$’000 $’000 $’000



Net(surplus)/deficit (28) (34) 85

(b) Contribution recommendations

Recommended contribution rates for the entity are:

SASS SANCS SSS

multiple of member % member salary multiple of member

contributions contributions

0.00 0.00 0.00

(c) Funding method

The method used to determine the employer contribution recommendations at the last actuarial review was the Aggregate

Funding method. The method adopted affects the timing of the cost to the employer.

Under the Aggregate Funding method, the employer contribution rate is determined so that sufficient assets will be available to

meet benefit payments to existing members, taking into account the current value of assets and future contributions.

42



(d) Economic assumptions

The economic assumptions adopted for the last actuarial review of the Fund were:

Weighted-Average Assumptions 2008 2007

Expected rate of return on Fund assets backing current pension liabilities 7.7% pa 7.7% pa

Expected rate of return on Fund assets backing other liabilities 7.0% pa 7.0% pa

Expected salary increase rate 4.0% pa 4.0% pa

Expected rate of CPI increase 2.5% pa 2.5% pa

Aus121.2 Nature of asset/liability

Where a deficiency exists, the employer is responsible for any difference between the employer’s share of fund assets and the

defined benefit obligation.

If a surplus exists in the employer’s interest in the Fund, the employer may be able to take advantage of it in the form of a

reduction in the required contribution rate, depending on the advice of the Fund’s actuary.


2008 2007 2008 2007

$’000 $’000 $’000 $’000

15. CHANGES IN EQUITY

Accumulated Funds

Balance at beginning of financial year: 7,138 4,711 7,138 4,711

Changes in equity – other than transactions

with owners as owners - - - -

Surplus/(Deficit) for the year 653 2,427 653 2,427

Balance at end of financial year 7,791 7,138 7,791 7,138

16. AUDITORS REMUNERATION

Internal auditors 18 30 18 30

External auditors 29 18 29 18

Total (net of GST) 47 48 47 48

43


2008 2007 2008 2007

$’000 $’000 $’000 $’000

17. COMMITMENTS

Future non-cancellable operating lease rentals not provided for and payable

Lease Commitments

Not later than one year 384 106 384 106

Later than one year but not later than five years 1,592 - 1,592 -

Later than five years - - - -

Total (including GST) 1,976 106 1,976 106

Other Expenditure Commitments

Not later than one year 51 - 51 -

Total (including GST) 51 - 51 -

Capital Commitments

Not later than one year 64 - 64 -

Total (Including GST) 64 - 64 -

Lease commitments include input tax credits of $179.6, other expenditure and capital expenditure include input tax credits

of $4.6 and $5.8 respectively which are expected to be recovered from the Australian Taxation Office (2007: $9.6).

18. CONTINGENT LIABILITIES

No contingent liabilities exist for the Institute and the Office (2007: nil).

19. NOTES TO CASH FLOW STATEMENT

(a) Reconciliation of Cash

For the purposes of the Cash Flow Statement, cash includes cash on hand and in the bank. At 30 June 2008, cash as shown

in the Cash Flow Statement of $7,829 (30 June 2007 $7,030) is equal to the amount shown in the Balance Sheet

(b) Reconciliation of Net Cash provided by Operating Results to Operating Activities


2008 2007 2008 2007

$’000 $’000 $’000 $’000

Surplus/(Deficit) as per the Income Statement 653 2,427 65 2,427

Depreciation and amortisation 149 77 149 77

(Increase)/Decrease in receivables (170) (1,057) (2) (1,057)

Increase/(Decrease) in payables 913 383 745 383

Net Cash Flows provided by Operating Activities 1,545 1,830 1,545 1,830



44



20. FINANCIAL INSTRUMENTS

The principal financial instruments of the consolidated entity and the Institute are outlined below. These financial instruments

arise directly from the operations of the consolidated entity and the Institute or are required to finance the operations of the

consolidated entity and the Institute. The consolidated entity and the Institute do not enter into or trade financial instruments,

including derivative financial instruments, for speculative purposes.

The main risks of the consolidated entity and the Institute from financial instruments are outlined below, together with the

objectives, policies and processes for measuring risk of the consolidated entity and the Institute. Further quantitative and

qualitative disclosures are included throughout this financial report.

The Board of Governance has overall responsibility for the establishment and oversight of risk management and reviews and

agrees policies for managing these risks. Risk management policies are established to identify and analyse the risks faced

by the Institute, to set risk limits and controls and to monitor risks. Compliance with policies is reviewed by Management on a

continuous basis.

(a) Financial Instrument Categories

Financial Assets Carrying Amount Carrying Amount

2008 2007

Class: Note Category $’000 S’000

Cash and cash equivalents 6 N/A 7,829 7,030

Receivables1 Receivables

7 (at amortised cost) 2,300 2,157

Payables2 Financial liabilities

measured at

12 amortised cost 267 338

Notes

1 Excludes statutory receivables and prepayments (i.e. not within scope of AASB 7) 2 Excludes statutory payables and unearned revenue (i.e. not within scope of AASB 7)

(b) Credit Risk

Credit risk arises when there is the possibility of the debtors of the consolidated entity and the Institute defaulting on their

contractual obligations, resulting in a financial loss to the consolidated entity and the Institute. The maximum exposure to

credit risk is generally represented by the carrying amount of the financial assets (net of any allowance for impairment).

Credit risk arises from the financial assets of the consolidated entity and the Institute, including cash, receivables and authority

deposits. No collateral is held by the consolidated entity or the Institute. The consolidated entity and the Institute have not

granted any financial guarantees.

Credit risk associated with the financial assets other than receivables, of the consolidated entity and the Institute, is managed

through the selection of counterparties and establishment of minimum credit rating standards. Authority deposits held with

NSW TCorp are guaranteed by the State.

Cash

Cash comprises cash on hand and bank balances. Interest is earned on daily bank balances at a commercial rate determined

by the bank. The TCorp Hour Glass Cash facility is discussed in paragraph (d) below.

45

Receivables – fees receivable

Accreditation fees receivable are recognised as amounts receivable at balance date. Collectability of fees receivable is

reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. An allowance for impairment is raised

when there is objective evidence that the amounts due will be not be collected by the consolidated entity and the Institute.

This evidence includes past experience and current and expected changes to the accreditation process that generates the

collectable fees. Accreditation fees are usually billed on 30 day terms.

The consolidated entity and the Institute are exposed to a concentration of credit risk to a single group of debtors due to the

legislative restrictions limiting the consolidated entity and the Institute to billing accreditation fees from New Scheme Teachers.

This exposure is deemed to be material.

The debtors of the consolidated entity and the Institute represent a large number of individual teachers whose particular credit

ratings will vary and are unknown to the Institute.

Past due

but not Considered

2008 ($‘000) Total impaired impaired

< 3 months overdue 1,207 1,137 70

> 3 months’ overdue 531 351 180

Past due

but not Considered

2007($‘000) Total impaired impaired

< 3 months overdue 3 3 -

> 3 months’ overdue 1,592 1,174 418

(c) Liquidity Risk

Liquidity risk is the risk that the consolidated entity and the Institute will be unable to meet its payment obligations when they

fall due. The consolidated entity and the Institute continuously manage risk through monitoring future cash flows to ensure

adequate holding of high quality liquid assets.

During the current and prior years, there were no defaults on payment obligations. No loans have been made and no assets

have been pledged as collateral.

The liabilities are recognised for amounts due to be paid in the future for goods or services received, whether or not invoiced.

Amounts owing to suppliers (which are unsecured) are settled in accordance with policy set out in Treasurer’s Directions

219.01. If trade terms are not specified, payment is made no later than the end of the month following the month in which an

invoice is received.

The following table summarises the maturity profile of the financial liabilities of the consolidated entity and the Institute

together with the interest rate exposure.



46



Interest rate risk refers to the risk that the value of the financial instruments will fluctuate due to the changes in market interest

rates. The exposure to interest rate risks of the consolidated entity and the Institute and the effective interest rates of the

financial assets and liabilities at the balance date are as follows:

Weighted Nominal Interest Maturity Effective Amount Rate Dates Interest ($’000)1 Exposure Rate ($’000)

Fixed Variable Non-Interest Interest Interest Bearing 2008 Rate Rate < 1 year

Payables - 267 - - 267 267

Weighted Nominal Interest Maturity Effective Amount Rate Dates Interest ($’000)1 Exposure Rate ($’000)

Fixed Variable Non-Interest Interest Interest Bearing 2007 Rate Rate < 1 year

Payables - 348 - - 348 348

Notes

1 The amounts disclosed are the contractual undiscounted cash flows of each class of financial liabilities, therefore the

amounts disclosed may not reconcile to the balance sheet.

(d) Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes

in market prices. The exposure of the consolidated entity and the Institute to market risk is primarily through price risks

associated with the movement in the unit price of the TCorp Hour Glass facilities. The consolidated entity and the Institute

have no exposure to foreign currency risk and do not enter into commodity contracts.

The effect on profit and equity due to a reasonably possible change in risk variables is outlined in the information that

follows, for interest rate risk and other price risk. A reasonably possible change is risk variable has been determined taking

into account the economic environment in which the consolidated entity and the Institute operate and the time frame for

assessment (i.e. until the end of the next annual reporting period). The sensitivity analysis is based on risk exposures in

existence at the balance sheet date. The analysis is performed on the same basis for 2007. The analysis assumes that all

other variables remain constant.

47



Interest rate risk

The consolidated entity and the Institute have minimal exposure to interest rate risk from its holdings in interest bearing

financial assets. The consolidated entity and the Institute do not account for any fixed rate financial instruments at fair value

through profit or loss or as available-for-sale. Therefore, for these financial instruments, a change in interest rates would not

affect profit or loss or equity. A reasonably possible change +/- 1% is used, consistent with current trends in interest rates. The

basis will be reviewed annually and amended where there is structural change in the level of interest volatility. The exposure to

interest rate risk of the consolidated entity and the Institute is set out below.

($’000)

-1% +1%

Weighted Carrying Profit Equity Profit Equity Average Amount Interest 2008 rate

Financial assets

Cash and cash equivalents 6.8% 7,829 (5) (5) 5 5

Receivables 2,380 - - - -

Financial liabilities

Payables 253 - - - -

($’000)

-1% +1%

Weighted Carrying Profit Equity Profit Equity Average Amount Interest 2007 rate

Financial assets

Cash and cash equivalents 6.8% 7,030 (5) (5) 5 5

Receivables 2,217 - - - -

Financial liabilities

Payables 338 - - - -

Other price risk – TCorp Hour Glass Facilities

Exposure to ‘other price risk’ primarily arises through investment in the TCorp Hour Glass Investment facilities, which are held

for strategic rather than trading purposes. The consolidated entity and the Institute have no direct equity investments. The

consolidated entity and the Institute hold units in the following Hour Glass investment trusts:

Facility Investment Investment 2008 2007

Sectors Horizon ($’000) ($’000)

Cash facility Cash, money Up to 1.5 years 7,584 6,696

market instruments (Pre-June 2008

up to 2 years)

48



The unit price of the facility is equal to the total fair value of net assets held by the facility divided by the total number of units

on issue for that facility. Unit prices are calculated and published daily.

NSW TCorp as trustee for the above facility is required to act in the best interest of the unitholders and to administer the trust

in accordance with the trust deed. As trustee, TCorp has appointed external managers to manage the performance and risks

of the facility in accordance with a mandate agreed by the parties. However, TCorp acts as manager for part of the Cash

facility. A significant portion of the administration of the facility is outsourced to an external custodian.

Investment in the Hour Glass facilities limits the exposure to risk of the consolidated entity and the Institute, as it allows

diversification across a pool of funds, with different investment horizons and a mix of investments.

NSW TCorp provides sensitivity analysis information for each of the facilities, using historically based volatility information

collected over a ten year period, quoted at two standard deviations (i.e. 95% probability). The TCorp Hour Glass Investment

facilities are designated at fair value through profit or loss and therefore any change in unit price impacts directly on profit

(rather than equity). A reasonably possible change is based on the percentage change in unit price (as advised by TCorp)

multiplied by the redemption value as at 30 June each year for each facility (balance from Hour Glass Statement).

Impact on profit/loss

Change in unit price 2008 2007

($’000) ($’000)

Hour Glass Investment

– Cash Facility +/- 1% +/- 76 +/- 67

(e) Fair Value

Financial instruments are generally recognised at cost, with the exception of the TCorp Hour Glass facilities, which are

measured at fair value. As discussed, the value of the Hour Glass Investments is based on the share of the consolidated entity

and the Institute of the value of the underlying assets of the facility, based on the market value. All of the Hour Glass facilities

are valued using ‘redemption’ pricing.

The amortised cost of financial instruments recognised in the balance sheet approximates the fair value, because of the short-

term nature of many of the financial instruments.

49

22. ACCOUNTING STANDARDS/INTERPRETATIONS ISSUED BUT NOT YET EFFECTIVE AS AT 30 JUNE 2008

The following new Accounting Standards have not been applied and are not yet effective:

AASB 3 (March 2008), AASB 127 and AASB 2008-3, regarding business combinations;

AASB 8 and AASB 2007-3 regarding operating segments;

AASB 101 (Sept 2007) and AASB 2007-8 regarding presentation of financial statements

AASB 123 (June 2007) and AASB 2007-6 regarding borrowing costs;

AASB 1004 (Dec 2007) regarding contributions

AASB 1049 (Oct 07) regarding the whole of government and general government sector financial reporting;

AASB 1050 (Dec 2007) regarding administered items;

AASB 1051 (Dec 2007) regarding land under roads;

AASB 1052 (Dec 2007) regarding disaggregated disclosures;

AASB 2007-9 regarding amendments arising from the review of AASs 27, 29 and 31;

AASB 2008-1 regarding share based payments;

AASB 2008-2 regarding puttable financial instruments;

Interpretation 4 (Feb 2007) regarding determining whether an arrangement contains a lease;

Interpretation 12 and AASB 2007-2 regarding service concession arrangements;

Interpretation 13 on customer loyalty programmes;

Interpretation 14 regarding the limit on a defined benefit asset;

Interpretation 129 (Feb 2007) regarding service concession disclosures;

Interpretation 1038 (Dec 2007) regarding contributions by owners.

The initial application of these standards will have no material impact on the financial results of the consolidated entity

and the Institute.

23. AFTER BALANCE DATE EVENTS

There were no events subsequent to balance date which affect the financial report.

END OF AUDITED FINANCIAL REPORT



50


51

ANNUAL REPORT 2007-2008NSW INSTITUTE OF TEACHERS

52

OFFICE OF THE INSTITUTE OF TEACHERS

STATEMENT BY THE EXECUTIVE OF THE NSW INSTITUTE OF TEACHERS

Pursuant to Section 41c (1b) and (1c) of the Public Finance and Audit Act, 1983, we declare that in

our opinion:

1. The accompanying financial report exhibits a true and fair view of the financial position of the

Office of the Institute of Teachers as at 30 June 2008 and transactions for the year then ended.

2. The report has been prepared in accordance with the provisions of the Public Finance and

Audit Act, 1983, the Public Finance and Audit Regulation, 2005, and the Treasurer’s Directions.

Further, we are not aware of any circumstances, which would render any particulars included in the

financial report to be misleading or inaccurate.


Chair Member




53

OFFICE OF THE NSW INSTITUTE OF TEACHERS

Income Statement For the year ended 30 June 2008

2008 2007

Notes $’000 $’000

Expenses

Salaries 2 2,176 1,736

Superannuation – Defined contribution plans 2 138 104

Superannuation – Defined benefit plans 2 686 84

Annual leave 2 205 58

Long service leave 2 67 60

Payroll Tax 2 117 84

Total Expenses 3,389 2,126

Income

Personnel Services 3 3,389 2,126

Total Income 3 3,389 2,126

SURPLUS/ (DEFICIT) FOR THE YEAR 6 - -

54


Balance Sheet As at 30 June 2008

Notes 2008 2007

$’000 $’000

ASSETS

Current Assets

Receivables 4 1,895 1,188

Non-Current Assets

Receivables 4 62 55

TOTAL ASSETS 1,957 1,243

LIABILITIES

Current Liabilities

Payables 5 14 10

Provisions 5 1,171 945

Non-Current Liabilities

Provisions 5 772 288

TOTAL LIABILITIES 1,957 1,243

NET ASSETS - -

EQUITY

Accumulated funds - -

TOTAL EQUITY 6 - -

55


Cash Flow Statement For the year ended 30 June 2008

Notes 2008 2007

$’000 $’000

CASH FLOWS FROM OPERATING ACTIVITIES

Payments

Employee related (3,389) (2,126)

Total Payments (3,389) (2,126)

Receipts

Personnel Services 3,389 2,126

Total Receipts 3,389 2,126

NET INCREASE/(DECREASE) IN CASH FROM OPERATING ACTIVITIES - -

NET INCREASE/ (DECREASE) in CASH - -

Opening cash and cash equivalents - -

CASH AND CASH EQUIVALENTS AT END OF FINANCIAL YEAR - -

56

OFFICE OF THE NSW INSTITUTE OF TEACHERS

Statement of Recognised Income and Expenditure For the year ended 30 June 2008

Notes 2008 2007

$’000 $’000

Total Income and Expense recognised Directly in Equity - -

Surplus/(Deficit) for the Year - -

TOTAL INCOME AND EXPENSE RECOGNISED FOR THE YEAR 9(b) - -

57



SUMMARY OF ACCOUNTING POLICIES

1. Reporting Entity

The Office of the Institute of Teachers (the Office) is a

Division of the Government Service, established pursuant

to Schedule 1 to the Public Sector Employment and

Management Act 2002. It is a not-for-profit entity as profit

is not its principal objective. It is consolidated as part

of the NSW Total State Sector Accounts. It is domiciled

in Australia and its principal office is at Level 10 175

Castlereagh Street, SYDNEY NSW 2000.

The objective of the Office is to provide personnel services

to the NSW Institute of Teachers.

As required by NSW Treasurer Circular 06/13, the Office

commenced operations on 1 July 2005 when it assumed

responsibility for the employees and employee-related

liabilities of the NSW Institute of Teachers.

This financial report for the year ended 30 June 2008 has

been authorised for issue by the Board of Governance on

20 October 2008.

a) Basis of Preparation

This is a general purpose financial report prepared

in accordance with the requirements of Australian

Accounting Standards which include Australian Accounting

Interpretations, the Public Finance and Audit Act 1983 and

Regulation, and specific directions issued by the Treasurer.

The accrual basis of accounting has been adopted in the

preparation of the financial report, except for cash flow

information.

All amounts are rounded to the nearest one thousand

dollars and are expressed in Australian currency.

Accounting policies are selected and applied in a manner

which ensures that the resulting financial information

satisfies the concepts of relevance and reliability, thereby

ensuring that the substance of the underlying transactions

or other events is reported.

Management judgements, key assumptions and estimates

are disclosed in the relevant notes to the financial report.

The following significant accounting policies have been

adopted in the preparation and presentation of the financial

report.

b) Revenue Recognition

Income is measured at the fair value of the consideration

received or receivable. Revenue from the rendering

of personnel services is recognised when the service

is provided and only to the extent that the associated

recoverable expenses are recognised.

c) Receivables

A receivable is recognised when it is probable that the

future cash inflows associated with it will be realised

and it has a value that can be measured reliably. It is

derecognised when the contractual or other rights to future

cash flows from it expire or are transferred.

A receivable is measured initially at fair value and

subsequently at amortised cost using the effective interest

rate method, less any allowance for doubtful debts. A short-

term receivable with no stated interest rate is measured at

the original invoice amount where the effect of discounting

is immaterial. An invoiced receivable is due for settlement

within thirty days of invoicing.

If there is objective evidence at year end that a receivable

may not be collectable, its carrying amount is reduced by

means of an allowance for doubtful debts and the resulting

loss is recognised in the income statement.

Receivables are monitored during the year and impairment

of debts is written off against the allowance when they

are determined to be irrecoverable. Any other loss or

gain arising when a receivable is derecognised is also

recognised in the income statement.

d) Payables

Payables include accrued wages, salaries, and related on

costs (such as payroll tax, fringe benefits tax and workers’

compensation insurance) where there is certainty as to the

amount and timing of settlement.

A payable is recognised when a present obligation arises

under a contract or otherwise. It is derecognised when

the obligation expires or is discharged, cancelled or

substituted.

A short-term payable with no stated interest rate is

measured at historical cost if the effect of discounting

is immaterial.

58



e)Employeebenefitprovisionsandexpenses

i) salaries aNd wages, aNNual leave, sick leave aNd oN costs

Liabilities for salaries are calculated at nominal amounts

based on the amounts expected to be paid when liabilities

are settled. Annual leave is recognised and measured in

respect of employees’ services up to the reporting date at

nominal amounts based on the amounts expected to be

paid when the liabilities are settled.

The outstanding amounts of payroll tax, workers’

compensation insurance premiums and fringe benefits tax,

which are consequential to employment, are recognised

as liabilities and expenses where the employee benefits to

which they relate have been recognised.

ii) loNg service leave aNd suPeraNNuatioN

Long Service Leave

The Office is a member of the Non-Budget Long Service

Leave Pool and as such, makes contributions to the Pool,

in accordance with NSWTC 04/02. The contributions are

recognised as an expense. The nominal value of long

service leave at reporting date is recognised as a liability

and equivalent asset in the Balance Sheet. Long service

leave payments to the employees are made by the Office,

and the Office subsequently receives reimbursement from

the Pool, for all of the payments made to employees.

Long service leave entitlements have been valued using

the short-hand method to approximate present value,

based on employees with five or more years’ service. An

actuarial review conducted by Treasury (Circular 07/4)

indicated that it is unlikely that the difference between the

present value and the nominal value will be material.

Defined contribution superannuation scheme

The Office contributes to defined contribution

superannuation schemes in accordance with

Superannuation Guarantee Contribution legislation and

Public Sector Employment and Management Act 2002

(PSEMA). Obligations for contributions to these schemes

are recognised as an expense in the Income Statement

as incurred. The liability recognised at balance date

represents the contribution to be paid in the following

month.

Defined benefits superannuation scheme

Pillar Administration advises the Office of the level of

liability for the Office’s superannuation commitments to its

employees who are members of the various divisions of

the scheme. The calculation of the superannuation position

is based on actuarial reviews independent of the Office’s

ongoing activities and involvement. The main drivers of the

actuarial calculations are the level of investment return,

salary inflation and CPI increases.

The Office has an obligation for the deferred benefits

contribution which becomes payable on and after

retirement of staff. Contribution is made to the State

Superannuation Scheme (SSS), the State Authorities

Superannuation Scheme (SASS) and the State Authorities

Non-Contributory Superannuation Scheme (SANCS). The

SAS Trustee Corporation through the Fund’s actuary has

determined that the unfunded superannuation liability as at

30 June 2008 for SSS and SASS was estimated at $772

(2007: unfunded superannuation liability $288). Prepaid

superannuation contributions for SANCS was estimated to

be $62 (2007: prepaid superannuation contributions $55).

Amounts representing prepaid superannuation

contributions are recognised as an asset. Amounts

representing unfunded superannuation are recognised as

a liability. At balance date, the net increase in unfunded

contributions from the previous year has been recognised

as superannuation expense.

iii) other ProvisioNs

Other provisions exist when the agency has a present legal

or constructive obligation as a result of a past event; it is

probable that an outflow of resources will be required to

settle the obligation; and a reliable estimate can be made

of the amount of the obligation.

f) Financial Instruments

Financial instruments give rise to positions that are a

financial asset either of the Office or its counterparty and a

financial liability of the other party. For the Office, these are

receivables. Note 15 discloses the relevant risk of financial

instruments. We record classes of instruments at cost and

carry them at net fair value.

59



2008 2007

$’000 $’000

2. EXPENSES

Salaries and wages 2,176 1,736

Superannuation–definedbenefitplans

Total expense 686 104

Superannuation–definedcontributionplans

Total Expense 138 84

Annual leave 205 58

Long service leave 67 60

Payroll tax 117 84

3,389 2,126

3. INCOME

Personnel services 3,389 2,126

3,389 2,126

4. CURRENT/ NON-CURRENT ASSETS

(a) Current

NSW Treasury Long service leave receivable 766 605

Receivable NSW Institute of Teachers 1,129 583

1,895 1,188

(b) Non-Current

Prepaid superannuation contributions 62 55

62 55

5. CURRENT/ NON-CURRENT LIABILITIES

(a) Current

Accrued salaries, wages and on-costs 14 10

Annual leave 405 262

Long service leave provision 766 683

1,185 955

(b) Non-Current

Unfunded superannuation liability 772 288

772 288

60



(c) Defined benefit superannuation plans

An actuarial assessment of the superannuation schemes as at 30 June 2008 was carried out by the Fund’s actuary

in accordance with AASB 119 Employee Benefits.

Details are as below:

Fund Assets

The percentages invested in each asset class at the balance sheet date are:

30 June 2008 30 June 2007

Australian equities 31.6% 33.6%

Overseas equities 25.4% 26.5%

Australian fixed interest securities 7.4% 6.8%

Overseas fixed interest securities 7.5% 6.4%

Property 11.0% 10.1%

Cash 6.1% 9.8%

Other 11.0% 6.8%

PositionStatementforeachdefinedbenefitsuperannuationplan


Member Numbers

Contributors 2 6 4


Pensioners 0 0 0





14 (62) 757 709



Net (asset)/liability to be recognised in balance sheet 14 (62) 757 709

1 The Future Service Liability (FSL) does not have to be recognised by an employer. It is only used to determine if an asset ceiling limit should be imposed (AASB 119, para 58). Under AASB 119, any prepaid superannuation asset recognised cannot exceed the total of any unrecognised past service cost and the present value of any economic benefits that may be available in the form of refunds from the plan or reductions in future contributions to the plan. Where the “surplus in excess of recovery” is zero, no asset ceiling limit is imposed.

61





Member Numbers

Contributors 2 6 4


Pensioners 0 0 0





(24) (31) 288 232



Net (asset)/liability to be recognised in balance sheet (24) (31) 288 232

Reconciliation of the assets and liabilities recognised in the balance sheet


$’000 $’000 $’000 $’000

Present value of partly funded defined benefit

obligations at end of year 503 267 3,058 3,828


Subtotal 14 (61) 757 710




Net Liability/(Asset) recognised in balance sheet at end of year 14 (62) 757 709


$’000 $’000 $’000 $’000

Present value of partly funded defined benefit

obligations at end of year 461 239 2,723 3,423


Subtotal (24) (31) 288 233




Net Liability/(Asset) recognised in balance sheet at end of year (24) (31) 288 233

62



Expense recognised in Income statement

Financial Year to 30 June 2008 SASS SANCS SSS Total

$’000 $’000 $’000 $’000





Actuarial losses/(gains) recognised in year 52 52 530 634




Expense/(income) recognised 67 60 560 687

Financial Year to 30 June 2007 SASS SANCS SSS Total

$’000 $’000 $’000 $’000





Actuarial losses/(gains) recognised in year 86 21 (32) 75




Expense/(income) recognised 89 24 (12) 101

Expected rate of return on assets

The expected return on assets assumption is determined by weighting the expected long-term return for each asset class by

the target allocation of assets to each class. The returns used for each class are net of investment tax and investment fees.

Actual return on Fund assets

SASS SANCS SSS

$’000 $’000 $’000


Actual return on Fund assets (33) (22) (157)


Actual return on Fund assets 47 32 288

63



a) Valuation Method and principal assumptions at the balance sheet date

The Projected Unit Credit (PUC) valuation method was used to determine the present value of the defined benefit obligations

and the related current service costs. This method sees each period of service as giving rise to an additional unit of benefit

entitlement and measures each unit separately to build up the final obligation.

b) Economic Assumption

30 June 2008 30 June 2007

Salary increase rate (excluding promotional increases) 3.5% pa 4.0% pa

to June 2008,

3.5% pa

thereafter

Rate of CPI Increase 2.5% pa 2.5%pa

Expected rate of return on assets backing current Pension liabilities 8.3% 7.6%

Expected rate of return on assets backing other Liabilities 7.3% 7.6%

Discount rate 6.55% pa 6.4% pa

Historical information

Financial year to 30 June 2008 SASS SANCS SSS

$’000 $’000 $’000



(Surplus)/Deficit in Fund 14 (62) 757

Experience adjustments – Fund liabilities (13) 9 269

Experience adjustments – Fund assets 65 (43) 261

Financial year to 30 June 2007 SASS SANCS SSS

$’000 $’000 $’000



(Surplus)/Deficit in Fund (24) (31) 288

Experience adjustments – Fund liabilities 193 39 249

Experience adjustments – Fund assets (107) (18) (281)

64



Expected contributions

SASS SANCS SSS

$’000 $’000 $’000

As at 30 June 2007


As at 30 June 2008


Disclosures required under paragraph Aus121.1 and Aus121.2

Aus121.1 Funding arrangements for employer contributions

(a) Surplus/deficit

The following is a summary of the 30 June 2007 financial position of the Fund calculated in accordance with AAS 25 “Financial

Reporting by Superannuation Plans”:


$’000 $’000 $’000



Net (surplus)/deficit 17 (61) 605


$’000 $’000 $’000



Net (surplus)/deficit (28) (34) 85

(b) Contribution recommendations

Recommended contribution rates for the entity are:

SASS SANCS SSS

multiple of member contributions % member salary multiple of member contributions

0.00 0.00 0.00

(c) Funding method

The method used to determine the employer contribution recommendations at the last actuarial review was the Aggregate

Funding method. The method adopted affects the timing of the cost to the employer.

Under the Aggregate Funding method, the employer contribution rate is determined so that sufficient assets will be available to

meet benefit payments to existing members, taking into account the current value of assets and future contributions.

65



(d) Economic assumptions

The economic assumptions adopted for the last actuarial review of the Fund were:

Weighted-Average Assumptions 2008 2007

Expected rate of return on Fund assets backing current pension liabilities 7.7% pa 7.7% pa

Expected rate of return on Fund assets backing other liabilities 7.0% pa 7.0% pa

Expected salary increase rate 4.0% pa 4.0% pa

Expected rate of CPI increase 2.5% pa 2.5% pa

Aus121.2 Nature of asset/liability

Where a deficiency exists, the employer is responsible for any difference between the employer’s share of fund assets and the

defined benefit obligation.

If a surplus exists in the employer’s interest in the Fund, the employer may be able to take advantage of it in the form of a

reduction in the required contribution rate, depending on the advice of the Fund’s actuary.

6. CHANGES IN EQUITY

2008 2007

$’000 $’000

Balance at beginning of financial year: - -

Changes in equity – other than transactions with owners as owners - -

Net Surplus/(Deficit) - -

Balance at end of financial year - -

7. COMMITMENTS

The Office does not have any capital or operating lease commitments.

(2007: nil)

9. CONTINGENT LIABILITIES

No contingent liabilities exist for the Office. (2007: nil)

66



10. NOTES TO CASHFLOW STATEMENT

(a) Reconciliation of Cash

For the purposes of the cash flow statement, cash includes cash on hand and in the bank. At 30 June 2008, cash shown in the

cash flow statement of nil is equal to the amount shown in the Balance Sheet.

2008 2007

$’000 $’000

(b) Reconciliation of Net Cash provided by Operating Results to Operating Activities

Operating Surplus/(Deficit)

Depreciation and amortisation -

(Increase)/ Decrease in receivables (714) 86

Increase/(Decrease) in payables 714 (86)

Net Cash Flows provided by Operating Activities - -

15. FINANCIAL INSTRUMENTS

The principal financial instruments of the Office are outlined below. These financial instruments arise directly from the

operations of the Office or are required to finance the operations of the Office. The Office does not enter into or trade financial

instruments, including derivative financial instruments, for speculative purposes.

The main risks of the Office from financial instruments are outlined below, together with the objectives, policies and processes

for measuring risk of the Office. Further quantitative and qualitative disclosures are included throughout this financial report.

The Board of Governance has overall responsibility for the establishment and oversight of risk management and reviews and

agrees policies for managing these risks. Risk management policies are established to identify and analyse the risks faced

by the Institute, to set risk limits and controls and to monitor risks. Compliance with policies is reviewed by Management on a

continuous basis.

(a) Financial Instrument Categories

Financial Assets Note Category Carrying Amount Carrying Amount

Class: 2008 2007

$’000 S’000

Receivables1 4 Receivables (at amortised cost) 1,895 1,188

Payables2 5 Financial liabilities measured 1,185 955

at amortised cost

Notes

1 Excludes statutory receivables (i.e. not within scope of AASB 7)

2 Excludes statutory payables and unearned revenue (i.e. not within scope of AASB 7)

67



(b) Credit Risk

Credit risk arises when there is the possibility of the Office’s debtors defaulting on their contractual obligations, resulting in

a financial loss to the Office. The maximum exposure to credit risk is generally represented by the carrying amount of the

financial assets (net of any allowance for impairment).

Credit risk arises from the financial assets of the Office, being receivables and authority deposits. No collateral is held by the

Office. The Office has not granted any financial guarantees.

There is no credit risk associated with the financial assets other than receivables.

Cash

The Office has no cash financial assets.

Receivables

Personnel Services receivable are recognised as amounts receivable at balance date. All receivables are deemed to be

collectable. No receivables are past due and there is no allowance for impairment.

The Office is not exposed to credit risk as the only debtors of the Office are the Institute and the Crown Pool.

(c) Liquidity Risk

Liquidity risk is the risk that the Office will be unable to meet its payment obligations when they fall due. The only payment

obligations recognised by the Office relate to accrued salaries and long service leave pool contributions which are non-interest

bearing and have a maturity date of less than one month. As such it is considered the Office has no liquidity risk.

(d) Market Risk

Market risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in

market prices. Due to the specific nature of Office’s financial instruments, it is considered that the Office has no exposure

market risk.

(e) Fair Value

All financial instruments are recognised at cost.

16. AFTER BALANCE DATE EVENTS

There were no events subsequent to balance date which affect the financial report.

END OF AUDITED FINANCIAL REPORT


Notes to and forming part of the Financial Statement For the year ended 30 June 2008

Appendix 1: NSW Institute of Teachers – Structure

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68

ANNUAL REPORT DETAILS

Published by: NSW Institute of Teachers

Design and Production:

Printing:

Print run:

Cost:

Also available at: www.nswteachers.nsw.edu.au

NSW Institute of Teachers Annual Report

Documents

Transcript of NSW Institute of Teachers Annual Report