WelTec 2011 Annual Report

Wellington Institute of Technology

2011 ANNUAL REPORT

VALUES MISSION VISION ACCOUNTABILITY INTEGRITY TERMS PARTNERSHIP TEAM WORK CUSTOMER FOCUSSUSTAINABILITY INSTITUTION BUSINESS INDUSTRY

WELTEC RESPONSIBILTY TEACH PASSIONATE INCLUSIVELEARNER CENT RED ENVIRONMENT RELEVANCE INCLUSIVE APPLIED RESPECT EXCELLENCE EFTS PERFORMANCE RESULTS SATIFACTION VALUE COURSE COMPLETIONS FINANCIAL ETHNICITY PROGRAMME ENROLMENTS SECONDARY SCHOOL FACULTY QUALIFICATION STAR STRATEGIC CONSOLIDATION COLLABORATION SOLID AUTOMOTIVE DISCIPLINES BUS INESS OPERATING COUNSELLING PLANNED WELTEC RESPONSIBILTY TEACH PASSIONATE INCLUSIVE LEARNER CENTRED ENVIRONMENT RELEVANCE APPLIED RESPECT EXCELLENCE EFTS PERFORMANCE RESULTS SATIFACTION VALUE COURSE COMPLETIONS FINANCIAL ETHNICITY PROGRAMME ELLENCE EFTS PERFO ELLENCE EFTS PERFORMANCE EFTS PERFO COLLABORA VISION MISSION GRADUATES GLOBAL CITIZENS WITH WORLD-CLASS SKILLS AND KNOWLEDGE GENERATE VALUE-ADD APPLIED KNOWLEDGE TECHNOLOGY TRANSFER SOLUTIONS PARTNERSHIP INDUSTRY PROFESSIONS RESEARCH ORGANISATIONS MISSION WELLINGTON INSTITUTE OF TECHNOLOGY WORK PARTNERSHIP IWI COMMUNITIES, INDUSTRIES PROFESSIONS EDUCATION ORGANISATIONS KNOWLEDGEABLE HIGHLY SKILLED ACCOUNTABLE GRADUATES INFORMED ACCESSADAPT KNOWLEDGE COMBINE HIGH LEVEL TECHNICAL ABILITY CREATIVE ENTREPRENEURIAL THINKING GOLD COLLAR ABLE LEARN THROUGHOUT LIFE ENHANCE WORKPLACE PRODUCTIVITY COMMUNITY DEVELOPMENT.RESEARCH KNOWLEDGE TRANSFER ACTIVITIES THAT: ADDRESS DIRECTLY THE NEEDS OF INDUSTRY AND PROFESSIONS AS VOICED BY ENTERPRISES LARGE AND

TIAKI HAPAI DAHM - TE ATIAWADIPLOMA IN EXERCISE SCIENCE GRADUATE 2011

VALUES

VISION AND MISSION

VISION

Our graduates are global citizens with world-class skills and knowledge. We also generate value-add through applied knowledge and technology transfer solutions in partnership with industry, professions and research organisations.

MISSION

Wellington Institute of Technology’s mission is to work in partnership with iwi, communities, industries, professions and other education organisations to deliver:

Knowledgeable, highly skilled and accountable graduates who:

Are well informed and able to access, use and adapt knowledge;

Combine high level technical ability with creative/entrepreneurial thinking (i.e. “gold collar” workers);

Are able to learn throughout life; and

Enhance workplace productivity and community development.

Research and knowledge transfer activities that:

Address directly the needs of industry and professions (as voiced by enterprises large and small);

Support seamless approaches that build critical mass and depth of expertise regionally, nationally and internationally; and

Build a community and enterprise culture embodying productivity and sustainability.

1

2

ACCOUNTABILITY AND INTEGRITYIn terms of what we are; what and how we teach; how we relate to students, industry and each other; how we take responsibility for our actions and our commitment to critical enquiry and academic freedom.

TEAM WORKContributing to an effective and supportive team environment, using and fostering creativity and innovation.

PARTNERSHIPWith business and industry; with iwi; with students and with fellow providers.

CUSTOMER FOCUSBeing passionate about customers and students. Looking for improvement and efficiencies in our service. Being a place that is inclusive, where diversity is recognised. Providing a learner-centred environment marked by relevance, applied learning and respect.

SUSTAINABILITYOf the Institution; of ourselves; and of the environment.

COMMITMENT TO HIGH PERFORMANCE AND PROFESSIONALISMEach individual, each day, aiming for excellence.

MILES OVIA – BACHELOR OF CREATIVE

TECHNOLOGIES GRADUATE 2011

FIONA BREEN – BACHELOR OF HOSPITALITY MANAGEMENT GRADUATE 2011

04 Overview of 2011

06 Council Member Profiles

06 Council Structure

08 Executive Management Team

10 Industry Advisory Committee

14 Chairperson’s Report

16 Training and qualifications vital to the Hospitality Industry – RUTH PRETTY

18 Rebuilding Christchurch

20 “WelTec – important to the region” – FRAN WILDE

22 Chief Executive’s Report

26 Commitment to industry partnership – MIKE KERR

28 Fronde’s vision for graduate possibilities – IAN CLARKE

30 Working partnership for youth – KERRY LEGGETT

32 WelTec Connect Ltd

34 Technical support for big ideas – JOSEPH VAN LIEMPT

36 Our people and Our environment

37 Showcasing Maori Contemporary Art – BARRY TE WHATU

38 Business plan performance

40 Research

42 NEC research fellow – TODD COCHRANE

44 Creative research – LORRAINE RASTORFER

46 Research supports clear and robust relationship – SUSAN TOWNSHEND

48 Statement of Objectives and Service Performance

51 Financial Statements

76 Responsibilities

77 Independent Auditor’s Report

81 Acronyms

Under 21 44%

21 – 24 23%

25 – 35 18%

35+ 15%

Age

Highest Entry Qualification

NZ European/Pakeha 54%

New Zealand Maori 14%

Asian 12%

Pacific Islander 9%

European 5%

Other 6%

By Ethnicity6%

54%

5%9%

12%

14%

560 School of Hospitality

559 School of Engineering

550 School of Automotive Technology

407 School of Health Services

352 School of Information Technology

328 School of Business and Administration

296 STAR

247 School of Social Services and Sector Engagement

238 School of Foundation Studies, Languages and Adult Education

225 School of Creative Technologies

184 School of Hair, Beauty and Make-up

77 Trades Academy

0 50 100 150 200 250 300 350 400 450 500 550 600 650

FUNDING STUDENT STATISTICS

Student Achievement Component (SAC) 67%

Industry Training Organisations (ITO) 13%

International 7%

STAR 6%

Youth Guarantee 2%

Full Fee 2%

Trades Academy 2%

Adult and Community Education (ACE) 1%

By Source1% 67%

6%

7%

13%

2%2%2%

Lower Hutt 32%

Wellington 28%

Central North Island 10%

Upper Hutt 9%

Porirua 5%

Upper North Island 5%

South Island 5%

Kapiti Coast 3%

Wairarapa 3%

By Region

5%

32%

5%

9%

12%

28%

5%

3%

3%

NCEA Level 2 26% (6TH FORM CERTIFICATE)

No Record 20% (NO FORMAL SECONDARY SCHOOL QUALIFICATION ON RECORD)

NCEA Level 1 17% (SCHOOL CERTIFICATE)

NCEA Level 3 17% (BURSARY OR SCHOLARSHIP)

Overseas Qualification 13%

14+ Credits 5% (14 OR MORE CREDITS AT ANY LEVEL)

Other 2%

2%5%

26%

13%

17%

15%

44%

18%

23%

20%

17%

Male 64%

Female 36%

Gender

64%

36%

644 School of Construction

EFTs

201010,600

Students

2011

10,385 Students

= 4,669EFTS

20098,700

Students

4CAMPUSES

ADDING VALUE

Petone, Wellington, Christchuch, Auckland

of total EFTS studied at Levels 4 – 7

of WelTec graduates reported they were in employment or going on to further study.

(as reported soon after graduation)

Students aged under 25 studied

of all the Level 4-7 EFTS delivered in 2011.

70%

SATISFACTION RESULTS

90% Student Satisfaction

96% Employer Satisfaction

EDUCATIONALPERFORMANCEINDICATORS

76% Course Completions

62%

40%

Level 1-2 65%Level 3-4 78%

Level 5-6 75%Level 7-8 81%

Level 1-2 60%Level 3-4 64%

Level 5-6 72%Level 7-8 50%

STRONG FINANCIAL PERFORMANCE

The Tertiary Education Commission (TEC) has again awarded WelTec a low risk rating for its financial performance.

5% Return on Total Income Strong cashflow and working capital

$2,765,000$1,455,000 Budget Net Profit

Industry advisory committees involving small to large companies across Wellington.16

INDUSTRY 65% Level 1-2 66%Level 3-4 58%

Level 5-6 64%Level 7-8 74%

Qualification Completions

Progression to Higher Level Study

Retained in Study

ADVISORY COMMITTEES(CHAIRS)

Alcohol and Drug – Tim Harding

Automotive Technology – Richard Eyles

Built Environment – Peter Degerholm

Business – Charles Gilmore

Community Support Services and Community Vocational Learning Skills Rosanne Johnston

Counselling and Trauma Studies David Waters

Creative Technologies – Laurence Greig

Engineering – Michael Kerr

Exercise Science – Mike Ryan

Funeral Services Prof. Mike Markfell-Jones

Hospitality – Ruth Pretty

Information Technology – Peter Ramsey

Pasifika – Linda Sissons

Plumbing – Colleen Upton

Wellington Trades Acdemy – Alan Peck

Youth Development – John Harrington

ROGER SOWRY ONZM CHAIRPERSON

Roger Sowry was a Member of Parliament from 1990 to 2005, firstly representing the Kapiti electorate, then as a National list MP. Roger retired from Parliament in 2005 moving to become Chief Executive of Arthritis New Zealand. He is a member of the Electricity Authority.

Roger is also a member of the Institute of Directors.

COUNCIL MEMBERS

DR ALAN BARKER DEPUTY CHAIRPERSON

Dr Alan Barker is a Senior Consultant with MartinJenkins. He has extensive international and domestic experience in public sector reform, strategic planning, organisation review and financial management. Alan has worked for a number of education related Institutions such as the TEC, MOE, NZQA, and Tairawhiti Polytechnic, as well as a number of other public sector entities.

PETER PRESTON

Peter has an early background in civil engineering (BE Degree) followed by a strong commercial background including senior management roles in BP NZ Ltd and directorships in related companies. He is a professional company director and a Fellow of both the IOD (Institute of Directors) and the Institution of Professional Engineers of New Zealand.

VAUGHAN RENNER

Vaughan has an MBA, and science and engineering qualifications. He runs his own businesses and has strong commercial, strategic planning and IT skills. Vaughan has a background in governance (currently including; The Employers Chamber of Commerce Central, Business NZ, and Standards New Zealand). He is a member of the Institute of Directors.

ACADEMIC BOARD

Alan Cadwallader – Academic Director

Alan Peck – Executive Dean,

Faculty of Trades and Technology

Barbara Kelly – Academic Registrar

Colin Porthouse – Academic Staff

Representative

Diane Langman – Academic Staff

Representative

Hinemoa Priest – Kaiwhakahaere Maori

Julia Hennessy – Executive Dean,

Faculty of Health, Business and Service

Industries

Linda Sissons – Chief Executive

Mick Jays – Academic Staff Representative

Nikita Snedden – Student Association

Representative

06 | WELLINGTON INSTITUTE OF TECHNOLOGY

DENNIS SHARMAN

Dennis owns and operates Sharman Consulting Limited a consultancy company that delivers comprehensive technology services to small and medium sized businesses. Dennis has just completed his term as Chair of the board of New Zealand Institute of Technologies. Dennis holds a number of Directorships, including government appointments to the Combined Council of Whitireia and WelTec and is also a founding member of the Board of Mana Tiaki.

SUZANNE SNIVELY ONZM

Suzanne Snively, formerly a partner at PricewaterhouseCoopers in Wellington, is the Managing Director of strategic and economic advice company, MoreMedia Enterprises. Suzanne is appointed to the Health Research Council by the Minister of Health Tony Ryall and Chairs the Agri-women Development Trust and Transparency International. She is Chief Judge of the Electra Business Awards. Previous directorships included the Reserve Bank of New Zealand. She is a member of the Institute of Directors and the New Zealand Association of Economists. Suzanne was awarded the Fulbright and Reserve Bank scholarships and was honoured by the Queen along with 100 women with a Women’s Suffrage medal.

PETER STEEL

Peter has an economic and engineering background having worked for over 25 years as a Consulting Engineer, becoming a Principal and Technical Director for Beca. He has strong commercial, governance and management experience from his work activities as well as a period as President of the Wellington Regional Chamber of Commerce. He is currently General Manager - Engineering & Standards for the Infrastructure and Engineering division of KiwiRail.

NANCY MCINTOSH-WARD

Nancy holds an MBA and is a Chartered Accountant. She is the Chief Executive of the Karori Sanctuary Trust and has extensive financial, management, commercial, governance, tertiary education and marketing experience. Nancy is a member of the Institute of Directors.

RISK AND AUDIT COMMITTEE

Vaughan Renner – Chair

Dennis Sharman

Peter Steel

WELTEC CONNECT

Peter Steel – Chair

Dennis Sharman

Nancy McIntosh-Ward

Suzanne Snively

LE CORDON BLEU NEW ZEALAND INSTITUTE

(DIRECTORS)

Linda Sissions – WelTec Chief Executive

Monsieur Andre Cointreau – President and CEO

of Le Cordon Bleu International

Paul McElroy – UCOL Chief Executive

CHIEF EXECUTIVE’S REVIEW COMMITTEE

Roger Sowry – Chair

Alan Barker

Peter Preston

072011 ANNUAL REPORT |

LINDA SISSONS, CNZM CHIEF EXECUTIVE

Ph. D. (London)

Diploma in Adult Education (Edinburgh)

MA (1st class Honours)

Advanced Management Programme (Harvard)

Linda has been responsible for the strategic management and leadership of WelTec since 1999. Prior to joining WelTec she held university and Institute of technology management roles in New Zealand and the United Kingdom.

She represents the New Zealand Government on the Board of Governors of the Commonwealth of Learning, is on the Board of WorldSkills NZ, and is a Director of ESITO (Electricity Supply Industry Training Organisation). She has been a member of a number of Government commissions, including the Tertiary Education Advisory Commission.

Linda holds a PhD from London University, is a graduate of the Harvard Business School Advanced Management Programme and is a member of the Institute of Directors.

TIM ALLEN GENERAL MANAGER, BUSINESS DEVELOPMENT

MARK BROADBENT HUMAN RESOURCES DIRECTOR

EXECUTIVE MANAGEMENT TEAM

BA (Victoria University)

Graduate Diploma in Marketing (Victoria University)

Tim leads the development of new opportunities and the promotion of WelTec to meet its objectives. His areas of responsibility are marketing, international and WelTec Connect.

During 2011 he led the establishment and growth of WelTec Connect, which has been highly successful in its engagement with industry on R&D and capability development. Tim has also led the further development of WelTec’s partnerships with industry for student work placements notably cadetships.

Tim has extensive commercial, marketing and international experience, gained through senior roles in a diverse range of industries including education, shipping, sports and horticulture.


Diploma of Education (Guidance)

Diploma (Youth and Development), (Commonwealth Youth Programme, Asia-Pacific)

Centre Ernst & Young Executive programme

Mark is responsible for WelTec’s human resources strategy and change management as well as human resources operations and capability development.

With more than 25 years’ experience in human resources, line management, and development roles Mark’s has worked in a wide range of organisations covering the not-for-profit sector, government, state-owned enterprises, and education.

Mark is a member of the Human Resources Institute of New Zealand.

ALAN CADWALLADER ACADEMIC DIRECTOR

MMgt (Massey University)

MBA (Otago University)

As Academic Director Alan is responsible for academic leadership at WelTec. His role is leading and managing academic policy development, including learning access, student support services and resources to ensure high-quality student learning experience outcomes. His role also includes leading the Institute’s research activities.

Nearly a decade in the tertiary sector is complemented by earlier pursuits in commerce and business. Alan has experience as a lecturer in business studies as well as head of school. His background in education for business management and his interest in New Zealand’s small business sector fit well with WelTec’s applied research and technology transfer contribution to business and industry.

During 2010 and much of 2011 Alan was a member of the Artena Society Board.


JAMES SMITH CHIEF FINANCIAL OFFICER

BCA (Victoria University)

CA (New Zealand Institute of Chartered Accountants)

James became the Chief Financial Officer in May 2011. In this role he managed the financial planning and reporting systems and services, and provided quality financial and strategic advice to internal and external stakeholders. During 2011 he was responsible for the Finance and Facilities & Procurement business units.

James has over a decade of tertiary sector experience gained both at WelTec and The Open Polytechnic of New Zealand.

MICHAEL HESP DIRECTOR, SPECIAL PROJECTS

JULIA HENNESSY EXECUTIVE DEAN, FACULTY OF HEALTH, BUSINESS AND SERVICE INDUSTRIES

Master of Applied Finance (Victoria University)

CA (New Zealand Institute of Chartered Accountants)

Michael began his new role, having previously been WelTec’s General Manager Corporate and Finance, in mid-2011. The role of Director, Special Projects is to provide advice on specific high priority strategy developments; manage investment and capital projects; and develop WelTec’s long-term campus plan.

Previous experience for Michael includes a number of roles for Fletcher Construction; being a member of the team that privatised Works Property Services to become Serco Group NZ, then holding the roles of Corporate Services Director and Finance Director for Serco; Chief Financial Officer and Board Secretary for the New Zealand Wool Board; a number of consulting and contracting roles for organisations including the Department of Labour, Healthcare Otago, Wellington City Council, and the Correspondence School.

Michael is a member New Zealand Institute of Chartered Accountants.


DipN (Wellington Polytechnic)

MEd (Victoria University)

MMgt (Massey University)

PG Dip HSM (Massey University)

Julia has the overall responsibility for the management of the Faculty of Health, Business and Service Industries, which includes the schools of Health and Social Services; Business and Administration; Foundation and Adult Education; Hair, Beauty and Exercise Science; Hospitality and Tourism and the Childcare Centre. The Faculty delivers half of the academic programmes in WelTec, with delivery from multiple sites including Auckland and Christchurch.

Prior to becoming Executive Dean Julia was previously Head of Centre of Health and Wellbeing at WelTec. She has also been General Manager, Mental Health and Addiction Service for Hutt Valley DHB and was also a senior advisor at the Ministry of Health.

Julia is a Ministerial appointment on the Nursing Council of New Zealand.

ALAN J PECK, ONZM EXECUTIVE DEAN, FACULTY OF TRADES AND TECHNOLOGY

BA (Auckland)

Diploma in Strategic Studies (University of NSW)

Graduate (Royal College of Defence Studies, London)

Advanced Management Programme (Harvard)

Alan has been Executive Dean of the Faculty of Trades and Technology since February 2009. He is responsible for WelTec’s schools of Information Technology, Creative Technology, Construction, Engineering, and Automotive Technology. He is also responsible for the Trades Academy, which opened in 2011.

Before joining the tertiary education sector in 2005, Alan served 40 years as an officer in the Royal New Zealand Navy, with a variety of appointments both at sea and ashore; in New Zealand and overseas. After leaving the Navy, Alan worked in the Ministry of Education, and the Tertiary Education Commission before joining WelTec.

PETER COWPER CHIEF OPERATING OFFICER

In 2011 the COO role involves managing the academic records and administration, information technology services, business intelligence and change management business areas. As well as these infrastructure and capability services, Peter’s responsibilities also include business process change initiatives for core student management.

Peter brings many years’ experience in leadership, managing complex and technical business operations, third-party supplier models and outsourcing, contract management and leading change. Peter’s previous roles include managing Telecom New Zealand’s operational and delivery business areas including leading large change projects. He was Head of Science and Engineering at BRANZ Ltd, a building research organisation and he owns Quorum Group, a management and leadership consultancy practice.

Peter is a Member of the Maritime New Zealand Authority, is a founding trustee of the Porirua Digital Trust and member of the New Zealand Institute of Directors.


ALCOHOL AND DRUG

Tim Harding (Chairperson) – CEO, CareNZ

Anna Nelson – Programme Manager, Matua Raki, National Addiction Workforce Development

Christine McCarrison – Addictions Professional Leader, Community Mental Health & Addictions Service, Hutt Valley DHB

Denise Nassenstein – Alcohol and Drug Counsellor Community, Alcohol and Drug Service (CADS)

Ian MacEwan – Executive Director, DAPAANZ

Jude West – Central Region Practice Leader, Problem Gambling Foundation of New Zealand

Major Stephen Scott – Director, Wellington Bridge Programme

Mary Anne Cooke – Director, ABACUS, Counselling, Training & Supervision Ltd

Maynard Gilgen – Clinical Director, Ora Toa Mauoriora

Murray Trenberth – CEO, WellTrust

Rhonda Robertson – Consumer Advisor, Matua Raki, National Addiction Workforce Development

Takurua Tawera – Clinical /Cultural Liaison, Te Hauora Runanga O Wairarapa Inc.

Trish Chivers – Team Leader, Community Mental Health & Addictions Service, Hutt Valley DHB

INDUSTRY ADVISORYCOMMITTEES 2011

AUTOMOTIVE TECHNOLOGY

Richard Eyles (Chairperson) – Workshop Owner, North City Automotives

Bridie Hewison – Workshop Owner, Lees Auto Bodies (2007) Ltd

Dave Wise – Trade Training Manager, NZ Army Trade Training School

Dean McMillan – Workshop Owner, D E McMillan Ltd

George Robinson – Sales Representative, Otbury Refinish Solutions

Hus Kala – Workshop Owner, Hutt City Auto Electrical

Jason Robertson – ITA, NZ MITO

Michael Beattie – Student Representative, Automotive Technology Year 1 D

Neil Butterfield – Workshop Owner, Porirua Autocrash Repairs

Nick McGuirr – ITA, NZ MITO

Owen Woodman – Workshop Owner, Woodman Automotive

Ross Wallace – National Training Manager, CablePrice NZ Ltd

Steve Caithness – Workshop Owner, Sovereign Panel & Paint

Steve Gaskin – Workshop Owner, Rolrich Panel & Spray 1988 Ltd

Verna Niao – Group Manager - Workforce Development, NZ MITO

BUILT ENVIRONMENT

Peter Degerholm (Chairperson) – Director, Calderglen

Dan McGuinness – Director, McGuinness Building Contractors

John Granville – Executive Director, NZIQS

Mike King – Senior Project Manager, Summerset Management Group

Paul Bunkall – Director, Rawlinsons

Russell Burley – Commercial Manager, Naylor Love

Tony Sutherland – Director, Rider Levett Bucknall


BUSINESS

Charles Gilmore (Chairperson) – CEO, IndeServe Ltd

Anne Hare – Financial Sector, NZX

Bill Davies – Business Finance Support Manager, Central Region and Tyco Fire & Security New Zealand

Brian Cowper – Agent, Hudson Recruitment

Diana Garrett – Programmes Manager, NZIM National Office

Kanwardeep (Kanwar) Bedi – Independent Business Man, Own Company

Kara Puketapu – Back up Iwi Representative, Te Runanganui o Taranaki whanui ki Te Upoko o Te Ika a Maui incorporated

Leo Austin – Owner, Austin Associates Limited

Neville Baker – Back up Iwi Representative, Te Runanganui o Taranaki whanui ki Te Upoko o Te Ika a Maui incorporated

Robyn Horton – Owner, McDonalds Queensgate

Teri Puketapu – Iwi Representative, Te Runanganui o Taranaki whanui ki Te Upoko o Te Ika a Maui incorporated

COMMUNITY SUPPORT SERVICES AND COMMUNITY VOCATIONAL LEARNING SKILLS

Rosanne Johnston (Chairperson) – Operations Manager, Te Korowai-Whariki/CCDHB

Jo Mason – Service Systems Manager, Community Connections

Linda Fisher – Operations Manager, Emerge Supported Employment Trust

Mark Pearce – Qualifications Pathway Manager, Careerforce

Maurice Priestley – Programme Coordinator, Inclusion & Disability Inclusion/Disability Capital Coast Health DHB

Monika Divis – Manager (Learning & Research), Spectrum Care

Rachel Cronin – Community Support/Health Promotion Coordinator Age Concern / ex student

Vicki Wall – Clinical Manager, Dawn Trust

COUNSELLING AND TRAUMA STUDIES

David Waters (Chairperson) – Chief Executive, Ambulance New Zealand

Helen Bowbyes – Guidance Counsellor, Naenae College

Jayne O’Neill – Clinical Leader, Relationship Services

Judy McCormack – Counsellor/Supervisor, The Counselling Group

Linda Karlin – Counselling and Training Manager, Skylight

Luana Murray – Senior Advisor, Relationship Services Whakawhanaungatanga

Mari Cribb – Guidance Counsellor, Upper Hutt College

CREATIVE TECHNOLOGIES

Laurence Greig (Chairperson) – Consultant, Workforce IP

Annette Beattie – Digital Services Manager, Hutt City Libraries

Bill Carden-Horton – Director, Billy Sushi

Christine Doherty-McGregor – Assistant Curator, Expressions Art and Entertainment Centre

Neville Parker – Designer, Designers Institute of NZ

Simon Croft – Technology Teacher, Wainuiomata High School

Steve La Hood – Director, Story Inc.


ENGINEERING

Michael Kerr (Chairperson) – Regional Manager (Wellington), BECA

Bill Caradus – General Manager, Central Zone & Wellington, Fulton Hogan Ltd

David Parle – Engineering Manager, Windsor Engineering Group Ltd

Don Wills – Associate Director,Transmission & Distribution, AECOM

Grant Daniels – Electronics Wing Warrant Officer, NZ Army

John Futter – Support Specialist Nanotechnology, National Isotope Centre, Institute of Geological and Nuclear Sciences, Rafter Laboratory

Dr. Peter Davenport – Engineer, Eastern Consulting Ltd

Richard Screech – Engineering Architect – Solutions Group, Alcatel-Lucent NZ Ltd

Dr. Rod Badcock – Senior Research Engineer, Industrial Research Limited

Ross Baker – Manager, Horokiwi Quarries

Theo Klok – Locomotive Performance Engineer, Kiwirail

EXERCISE SCIENCE

Mike Ryan (Chairperson) – Regional Development Manager, Tennis Central

Ben Montague – Club Manager, Lifestyle Gym

David Lomax – Pastoral Care, Te Runanganui o Taranaki whanui ki Te Upoko o Te Ika a Maui incorporated

Deslea Wrathall – Performance Services Manager, NZ Academy of Sport North Island

Gerry Salmon – Regional General Manager, Les Mills Gym

Jason Hemson – General Manager, Wellington Rugby League

Marcus Sherwood – Leisure Active Manager, Hutt City Council

Mark O’Connor – General Manager Operations, Swim NZ

Tracy Heron – Personal Trainer, Fitness consultant co-ordinator & Group Exercise instructor, Lifestyle Gym

FUNERAL SERVICES

Prof Mike Marfell-Jones (Chairperson) – Open Polytechnic of NZ – Representing Education

Anne McGuire – Self Employed, Gisborne – Representing Education, Maori

Alistair Ferguson – Marsden House Funeral Directors, Nelson – Representing New Zealand Embalmers Association Inc.

Danny Langstraat – Harbour City Funeral Home, Lower Hutt – Representing Funeral Directors Association of New Zealand Inc.

Fiona Gillespie – Trust Secretary

John Peryer – Executive Officer, Tong and Peryer Limited, Havelock North – Independent

John Duncan – Kapiti Coast Funeral Home, Paraparaumu – Representing Funeral Directors Association of New Zealand Inc.

John Schipper – Vice-Chair, Davis Funeral Home, Auckland – Representing New Zealand Embalmers Association Inc.

HOSPITALITY

Ruth Pretty (Chairperson) – Managing Director, Ruth Pretty Catering

Anthony Dey – General Manager, Brentwood Hotel

Bernd Lippman – Executive Chef, Museum of New Zealand Te Papa Tongarewa

Eddie Wairau – Manager, Petone Working Men’s Club

Francois Febvré – Proprietor, La Cloche

Georgina Noon – H R Manager, InterContinental Wellington

Glen Curphey – Executive Chef, Brentwood Hotel

Gregory Keating – General Manager, Duxton Hotel

Joanne Craughwell – Senior H R Manager, Accor Hospitality

Kaye Paardekooper – Conference Organiser, Paardekooper and Associates

Mark Angus – Hotel Manager, Bolton Hotel

Mike Egan – Own Manager, Monsoon Poon

Rachel Burt – H R Manager, City Life Wellington – A Heritage Hotel

Sara Tucker – Regional Manager, Hospitality Association of NZ

Sonia Tiatia – Schools Advisor, Hospitality Standards Institute


INFORMATION TECHNOLOGY

Peter Ramsey (Chairperson) – Private Contractor

Alisdair McKenzie – Principal Consultant, IS Assurance Services

Brian Rowe – Director, Examine Co. NZ

Dr Donald Koh – BIT Monitor

Dr Elozor Schneider – Information Systems / Technology, The Open Polytechnic of NZ Limited

Jonathan Fry – Delivery Manager, Fronde Systems Group Ltd

Kevin Groves – Student Rep, WelTec

Lester Abbey – Managing Director, Telemetry & Data Communications – Abbey Systems

Mark Carroll – Ministry of Education

Russell Kean – Engineering Consultancy, Opus Central Laboratories

Sergius Kramar – Developer / Analyst, FMG Co. NZ (Advice and Insurance)

PASIFIKA

Linda Sissons (Chairperson) – Chief Executive, WelTec

Aiono Mino Cleverley – Samoan Community

Filipo Lui – Tokelauan Community

Kerese Manueli – Fijian Community

Tupu Araiti – Tongan Community

Vei Lotaki – Tongan Community

PLUMBING

Colleen Upton (Chairperson) – General Manager, Hutt Gas & Plumbing Systems Ltd

Dave Walker – Project Manager, Aquaheat Industries Ltd

Derek Plimmer – Owner, Plimmer Plumbing Ltd

Fiona Gavriel – CEO, Master Plumbers Ltd

Ian Elliott – CEO, Plumbing, Gasfitting, Drainlaying & Roofing ITO

John Leen – Owner / CEO, John Leen Plumbing Ltd

Malcolm Andrew – Manager, Duncan McGregor Ltd

Ross Tait – Plumber & Gasfitter, K J Tait Ltd

Stewart Weddell – Owner, Plumber 1

Tony Wood – Manager, Masterlink Ltd

WELLINGTON TRADES ACADEMY

Alan Peck (Chairperson) – Executive Dean, WelTec

Carrie Murdoch – Business NZ

Grant Jones – Principal, Newlands College

John Bush – Wairarapa Workforce Development Trust

Kerry Leggett – Vibe Lower Hutt

Martin Isberg – Principal, Wainuiomata High School

Richard Campbell – Principal, Paraparaumu College

Ross Sinclair – Principal, Hutt Valley High School

Sally Haughton – Principal, Wellington East Girls’ College

Sue Roberts – Regional Chair CATE, Aotea College

YOUTH DEVELOPMENT

John Harrington (Chairperson) – National Coordinator, National Youth Workers Network Aotearoa

Adrienne Bull – Manager Qualifications Development, Social Services ITO

Andy Pilbrow – National Quality Services Manager, YMCA NZ National Office

Bill Peace – Social Services Manager, Strive Community Trust

Dawn Badco – AOD Youth Clinician, HVDHB

Elizabeth Kerekere – Rangatahi Maori Consultant, Tiwhanawhana Trust

Lloyd Martin – Coordinator, Praxis

Maree Tukukino – Consultant, Kapuia Services Ltd

Trish Gledhill – Director/Executive Trustee, Kina Families & Addictions Trust


CHAIRPERSON’S REPORT

2011: Fulfilling our expectations

Meeting the needs of students is core business for tertiary education

Institutions and is always front-of-mind at WelTec. As a leader in the

tertiary education sector and a key player in industry in the Wellington

region WelTec’s responsibilities also extend broadly into the wider

community.

As I indicated in the last Annual Report, 2011 was a year of building

on the collaborative partnerships we have with other tertiary

providers and business, diversifying our revenue streams and

consolidating our financial position. These things, and more, have

been achieved. The themes this year have been about consolidating

and extending WelTec’s strong links with industry, contributing to

productivity and economic growth in the Wellington region and often

the rest of New Zealand.

Student Body

In 2011 WelTec exceeded its targets for student enrolments. Almost

4,700 EFTS were achieved (Equivalent Full Time Students) equating

to 10,385 students. Two thirds of these students were studying at

level four and above. 77% were part-time. 60% were aged under 25

representing a higher youth cohort studying at WelTec via initiatives

such as WelTec’s Trades Academy, Youth Guarantee and Tamaiti

Whangai programmes.

Most students were undertaking some form of work placement or

work experience whilst they studied. 70% of WelTec graduates told

us that they were either in work or undertaking further study soon

after completing their qualification. This tells us, in an economic

sense, that the products WelTec offers are in demand.

Whakarongo ake auKi te tangi a te manu neiTuuii, tuuiiTui, tuia

Tuia I rungaTuia I raroTuia I rotoTuia I whaoTihei mauri ora

I listenTo the cry of the birdThe TuiBind together, stitch together, weave togetherThose things from aboveThose things from belowThose things from within usThose things from around usBehold the sacred breath of life


CHAIRPERSON’S REPORT

Financial performance

Strong financial performance was again achieved in 2011 through

tight fiscal control and new revenue from delivering additional

trades training through the government’s Skills for Canterbury

initiative. WelTec’s Total Return on Income of 5% exceeded

expectations with a Net Profit of $2.765M against a budgeted

figure of $1.455M. As Council Chair I am very proud of this result,

particularly given the current economic environment and I offer my

congratulations to staff for their efforts in this regard.

Views of Stakeholders

WelTec was awarded a “low risk” rating by the Tertiary Education

Commission (TEC) in 2011 based on the prior year’s performance.

Provisional Educational Performance Indicator results, also

assessed by the TEC, showed that WelTec performed well in 2011,

achieving above the ITP sector median for all four indicators. This,

along with NZQA’s External Evaluation and Review grade of “Highly

Confident” awarded to WelTec for its educational performance

indicates that the key funders and policy makers view the Institution

as a high performer.

Progress on the New Zealand Centre for Cuisine and Hospitality Excellence

In 2010 we announced that WelTec’s award-winning School of

Hospitality would join with the internationally renowned Le Cordon

Bleu New Zealand Institute and UCOL to create a centre for cuisine

and hospitality excellence.

This year construction progressed on the school, which will be

based in the hospitality heart of central Wellington City. This

represents a significant investment in Wellington’s hospitality

industry. The centre will offer world-class training facilities and

attract local and international students to what is, arguably, New

Zealand’s capital of hospitality. The new facilities themselves will

add value and a focus to the area around lower Cuba St and there

will be great benefits to the wider community through the growth in

student numbers and business opportunities.

With a collaborative approach and an international edge, the new

centre will focus on excellence and will deliver WelTec’s unique and

widely-acclaimed programmes including the Bachelor of Hospitality

Management and the Graduate Diploma in Event Management.

Training will be offered at all levels of employment across the

hospitality sector.

The new centre will open in September 2012.

Students First

Students First is an innovative collaboration with Whitireia

Community Polytechnic. In 2011 WelTec and Whitireia together

investigated the opportunities to collaborate for the benefit of

students and to improve efficiencies for both Institutes. Four

collaborative options were identified and thoroughly investigated,

including project-based collaboration, shared services, a merger

and a strategic partnership. The strategic partnership model

proved to be the strongest option, one that creates both a strategic

and operational partnership between the two Institutes. It maintains

two separate Institutions, with their own chief executives, but

establishes a single combined council and joint academic board.

When both Institutions took the strategic partnership proposal

to stakeholders for consultation the feedback received was

overwhelmingly one of agreement, giving WelTec and Whitireia the

mandate to proceed.

This approach is a first for the tertiary education sector in New

Zealand. It will draw on the strengths of both Institutes to give

students easier access to a diverse range of programmes; create

distinctive, new centres of excellence that work closely with industry;

provide a single strategic overview of, and stronger voice for,

vocational tertiary education and be a one-stop-shop for industry in

the greater Wellington region.

The new combined council and joint academic board are now in

place and WelTec and Whitireia have begun working together on a

joint strategic plan and a range of initiatives to improve outcomes

for students and industry and achieve efficiencies for both Institutes.

The cultures, identities and practices of both WelTec and Whitireia will

be retained while we work together to share resources, knowledge,

expertise and best practice.

Acknowledgements

WelTec’s relationships with industry and its focus on contributing to

productivity and economic growth remained a key focus for 2011.

This was exemplified through WelTec’s advisory committees who

continued to have a key role across the Institution assisting with the

design of new qualifications and updating existing programmes;

offering work placements and cadetships; and facilitating

employment opportunities for graduates. Advisory Committees had

a major role in the development of Students First and I thank the

members for their time and contribution.

I would like to formally recognise WelTec’s Chief Executive Dr

Linda Sissons. Linda led and maintained the high performing

status of WelTec in a challenging economic environment. In 2011

she set the parameters for the Institution to successfully focus on

student achievement; and to maximise WelTec’s and its graduates’

contribution to the region’s productivity and economic growth. The

Council and WelTec benefitted from Linda’s contribution to tertiary

education at a national and international level through her Deputy

Chairpersonship of the Commonwealth of Learning Board of

Governors and her role as Chair of the New Zealand Metro Group.

Finally I acknowledge the contribution of fellow Councillors throughout

2011, particularly their involvement in the Students First initiative.

I am pleased to present you with the 2011 Annual Report for the

Wellington Institute of Technology.

Roger Sowry ONZM


TRAINING AND QUALIFICATIONS VITAL TO THE HOSPITALITY INDUSTRY

Renowned Wellington caterer, Ruth Pretty is Chair of WelTec’s Hospitality Advisory Committee and also holds an Honorary Bachelor in Hospitality Management from WelTec for her significant contribution to the Wellington region and the wider New Zealand food and hospitality sectors.

Through her role on the advisory committee Ms Pretty works closely with WelTec’s hospitality leadership team, providing guidance and advice from an employer’s perspective. Her vision for the Wellington hospitality sector is a vibrant and thriving industry that is an attractive career option for the region’s young people.“Cherie Freeman (Head of School of Hospitality) and her team are very open about the challenges and opportunities they face,” says Ms Pretty.

Ms Pretty says the advisory committee was also a good forum for the industry to receive updates on WelTec’s new School of Hospitality currently being built in Wellington. The School will also house WelTec’s joint venture partner, Le Cordon Bleu.

“The new School of Hospitality will build on Wellington’s profile as the culinary capital of New Zealand and will showcase the School and all it offers. It will also be hugely beneficial in forging relationships with employers in our industry and providing the skilled hospitality staff required.

Ms Pretty says WelTec’s School of Hospitality is a place that actively engages with industry leaders and works hard to understand and respond to what industry is looking for from its graduates.

“The School is very open to ideas and the team has fantastic relationships with their tutors and students. The result is a very high standard in hospitality training.”

“Training and qualifications are vital to the hospitality industry in New Zealand and it is great to see WelTec’s hospitality team build such a strong and vibrant presence within Wellington’s hospitality community.

We talk about the global issues and trends happening within our industry which in turn helps Cherie’s team in ensuring relevant courses that will deliver graduates our industry needs.


REBUILDING CHRISTCHURCH

Restoring Christchurch will be a massive task, requiring an army of skilled tradespeople. So WelTec put its hand up to work with the government and industry to train the people needed to rebuild Christchurch.

The TEC invited WelTec to expand our trades delivery to help meet Christchurch’s future building needs. Of the nine Institutions that shared the extra $7.5M funding, WelTec received by far the largest allocation – 25 percent of the total amount.

WelTec’s Skills for Canterbury initiative now has 100 extra young people learning trades skills and becoming ‘work ready’. This approach is getting ahead of the anticipated high demand for skilled workers from mid-2012, not just for Christchurch but also to help remedy the country’s leaky homes situation and the expected demand for new housing. As well as delivering these trades programmes from WelTec’s Petone campus, customised carpentry training facilities were set up in Wairarapa and Kapiti in conjunction with agencies in those areas. In Kapiti, we are working with Whitireia on these initiatives.

This year, WelTec’s trades students also built two houses as part of their learning and these houses have been donated to Christchurch.


WELTEC – IMPORTANT TO THE REGION

Renowned Wellingtonian, the Hon Fran Wilde was recently awarded WelTec’s Technology Medal in recognition of her significant contribution to the region and community. Fran’s vision of Wellington is shaped by her experience and hands-on involvement in the wider region. “It’s always easy to lapse into clichés but the ideas of prosperity and resilience spring to mind as fundamental. With our urban agglomeration (from Wellington City through the Hutt Valley and up through Porirua to Kapiti) we are already a city-region,” says Fran.

That includes creating the economic environment to generate the sort of jobs that will attract and hold younger people. “We need to deliver the interventions necessary to ensure our local communities, social networks and our large regional infrastructure are all future-proofed, so they are able to withstand whatever nature or the global economy might throw at us in the next century,” says Fran.

“For me, this means literally getting our act together. There are many players - business, local communities, education, research and local government. Current fragmentation is recognised as a barrier to success and a number of sectors are moving towards a more strategic arrangement. The old adage “think global - act local” could well be adapted to “think regional - act local.”

To achieve that vision, Fran recognises that tertiary education will be a critical lever for creating prosperity and resilience - for making Wellington the place people choose to live.

“WelTec is right in the middle of the equation, with its focus on practical and relevant education.“WelTec bridges the gap between teaching and research, between academia and vocational training. It provides hundreds of Wellingtonians with the boost they need to succeed in the workforce.”

In looking ahead at what workforce requirements will be needed Fran says the key is to have tertiary delivery that is agile and adaptable.

“WelTec sits exactly on that spot and its responsiveness to the needs of commerce and industry is a characteristic that must be maintained and supported.”

Our city centres and garden suburbs, the coast that rings us and the easily accessible Wairarapa countryside give outstanding opportunities for a balanced quality of life. However, if we are to continue to be “the coolest little capital” we need to do some things differently.

SAYS FRAN WILDE


Ma wai raa, e tau rimaTe Whare Wananga o te AwakairangiMa te tikaMa te pono Ma te aroha e

Who will care for this place of learning?This place called AwakairangiIntegrity willTruth willAnd so too will love

CHIEF EXECUTIVE’S REPORT

2011 was a big year at WelTec. Many initiatives, in development

for some time, have come to fruition and are performing well.

Our students continued to achieve great outcomes – both in their

courses of study and by gaining recognition further afield. WelTec’s

walls become ever more permeable as we continue to build on our

relationships within industry, the community and the tertiary sector.

WelTec’s longstanding working relationship with Te Runanganui

O Taranaki Whanui Ki Te Upoko O Te Ika A Maui continued to

strengthen in 2011. A number of initiatives were pursued alongside

the flagship Tamaiti Whangai programme (discussed later in this

report). The Runanga has a well-developed strategic vision for

the Hutt Valley, based on Maori values and practices. This vision

involves key partners working together to actively build cohesive,

strong and vibrant communities. The Runanga views WelTec as a

key contributor to this vision and we view the relationship as critical

to achieving successful outcomes for Maori.

We are very pleased to report that WelTec exceeded the

Government’s four key education performance indicator targets

this year. We acknowledge that these are important indicators of

a tertiary Institution’s success so we put considerable work and

focus into these areas in 2010. The evidence of this effort is clear in

2011 and our students are the winners.


Educational Performance Indicator 20111

YEAR 2010 2011 (provisional)

COURSE COMPLETION76% / 13THMEDIAN 77%

77% / 9THMEDIAN 75%

QUALIFICATION COMPLETION64% / 3RDMEDIAN 57%

63% / 4THMEDIAN 56%

PROGRESSION TO HIGHER LEVEL

39% / 4THMEDIAN 29%

40% / 4THMEDIAN 32%

RETENTION61% / 2NDMEDIAN 51%

64% / 3RDMEDIAN 54%

We also over-achieved on our domestic student number targets in

2011. Other goals were harder to achieve, including international

student numbers and revenue, because of the challenging

economic environment. We report against all our Business Plan

goals later in this document.

In highlighting some of our major achievements for the year I would

like to acknowledge the many people who have contributed to these

successes. It takes individual effort and commitment, with the support

and collaboration of others, to achieve the results we have. Despite

a year of change and challenge, the Executive Management Team

(EMT) and staff have retained their focus on supporting student

outcomes. I thank them for continuing this effort; the results are

remarkable. I know I speak for our Council and my EMT colleagues

in acknowledging the extraordinary support of our wider community

– employers, industry, community leaders and strategic partners – in

helping us fulfill our purpose.

Positive industry relationships WelTec links with industry and employers in many ways. This year

these links continued to grow and develop at all levels. From

functions and events; to cadetships and scholarships; to advanced

research and development, WelTec and employers work side-by-side

increasing productivity and contributing to economic growth, with

benefits for our students, the community and businesses.

The 2011 Employer Satisfaction survey results showed that

Wellington employers continue to be very positive about the training

and education provided by WelTec. WelTec’s training continues to

be seen as relevant by employers with 96% saying they were very

satisfied or satisfied with the relevance of our qualifications.

The majority of employers surveyed viewed WelTec’s qualifications

as relevant to their needs with graduates considered work ready.

Employers commented that the strength of the relationship

with staff has a major influence over how they view WelTec and

encourages their involvement in WelTec’s programmes. The

continued uncertainty of both the international and national climate

continues to impact on employers influencing decisions to take

on new graduates and apprentices. Countering this is the view

of employers who consistently endorse the value of having work

experience components in programmes. This has a positive impact

on employment opportunities.

1. SAC only as reported on TEC website

WelTec’s Advisory Committees

Driven by industry, these committees give us valuable links into

industry and provide us with important insights that guide our

planning. For example, this year the Creative Technology advisory

committee reported growth in the film and television business in

Wellington. Likewise, the Hospitality and Construction advisory

committees anticipate skill shortages. We responded to these needs

with additional programmes and student places.

The Mayors of both Wellington and Hutt cities announced they are

keen to see the area as a hub for innovation and technology and

recognised that WelTec has an important role in attracting and

supporting business here.

The events we host and attend, as well as working relationships,

contribute to the strength, longevity and creativity of our relationships.

We greatly exceeded our target of significant events over the year

with impressive turnouts and great conversations.

Further afield, staff from the School of Creative Technologies,

supported by WelTec Connect, delivered an intensive two-week

course at Hong Kong Cyberport, a creative digital community

that nurtures start-ups. Cyberport is owned by the Hong Kong

government. The trip cemented a relationship with Cyberport

and introduced its young entrepreneurs to WelTec’s practical,

interdisciplinary industry-based approach to working, taking them

through an entire creative process from concept to presentation. The

relationship has the potential to attract students in the future, as well

as a unique teaching and learning experience for WelTec tutors.

Celebrating student success

It was a good year for industry recognition in the form of awards and

recognition. Hospitality students won the prestigious Toque d’Or

competition and the Fonterra Proud to be a Chef competition; earned

a rare international excellence award from City and Guilds as well

as a range of other scholarships and prizes. Creative Technologies

students received accolades at their exhibition, COLLIDEOSCOPE,

at the Academy of Fine Arts in Wellington where many works were

sold to collectors and two students received job offers. Bachelor of

Information Technology students won the 2011 National Netriders

Networking competition.

A Diploma of Beauty Therapy student won the best student award

at the New Zealand Beauty Awards. A WelTec bricklaying apprentice

won the silver trowel award as the top year-three apprentice at the

Bricklayer of the Year awards.

Quiet achievers include those students at levels 1-3 who improved

their literacy and numeracy skills. The Tertiary Education Commission

(TEC) recognised the efficacy of the WelTec approach to embedding

literacy and numeracy at this level. WelTec is the only Institute of

technology or polytechnic (ITP) to meet the TEC target for literacy and

numeracy, resulting in WelTec being profiled in the TEC’s assessment

tool video clip as representing best practice in the sector.

A supportive learning environment

This year we again combined forces with Te Ati Awa to mentor

young Maori with our Tamaiti Whangai initiative. The focus for Tamaiti

Whangai is supporting Maori students to complete their studies and

get a qualification that leads to employment. This is achieved by

encouraging students to excel at their studies as well as their sport;

promoting culture and wellness and leadership; removing barriers to

learning and feelings of isolation by taking a team approach to study.

Feedback from students participating in Tamaiti Whangai is that the

programme has developed their sense of personal responsibility, their

confidence in themselves and their concern for others. The NZQA, in

its quality assurance review of WelTec, described Tamaiti Whangai as

‘impressive’ and noted that the programme has led to increases in

students’ educational performance and significant gains in their self-

confidence, attitudes to learning, and work-readiness.

With a Maori roll of 16 percent of the total student population,

initiatives such as Tamaiti Whangai are increasingly important and

we are looking at ways to expand the programme in response to

demand.

To support the Skills for Canterbury initiative and provide opportunities

for young Maori, Te Puni Kokiri provided 40 scholarships for Maori

students to study trades finishing courses in tiling; bricklaying and

blocklaying; pre-trade painting, landscape construction; plumbing

and gasfitting.

Putting students into business

Integrating work experience with tertiary study is a key feature of

WelTec’s programmes and adds value to student learning and

employment outcomes for both student and employer. During the

year WelTec appointed an Industry Partnerships Coordinator to

increase the range of cadetships and work placements available to

WelTec students.

Achievements in 2011 included the creation of new cadetships

with several organisations including NEC and IRL. Longer-term

relationships continue to grow. This year’s Fronde Cadet Scheme

was the largest yet, with eight first-year students enjoying the benefits

of scholarships and work experience.

WelTec also placed students through Grow Wellington’s Summer of

Tech programme and created a number of project-based internships.

Feedback from industry clients has been very positive about the value

that WelTec students on work placement bring to their companies.

Wellington Trades Academy

2011 was the first year of operation of the Wellington Trades

Academy, established to deliver vocational trades and technology,

as well as general educational, qualifications in partnership with

secondary schools. Thirty schools are now working with the Academy

and in 2011 we had 78 students simultaneously enrolled at WelTec

and their secondary school. Seven trades strands were offered –

automotive technology; building construction; creative technologies;

hair and beauty; hospitality; mechanical engineering; and recreation

and sport.


Honorary awards

This year, WelTec made honorary awards to two professionals for their

outstanding contributions to their professions and wider communities.

These people share many goals with WelTec and we are pleased

they felt it an honour to receive awards. For his significant creative

contribution to the craft of photojournalism and the wider New

Zealand photographic community, WelTec awarded the Honorary

Bachelor of Creative Technologies to Peter Bush, a living legend in

New Zealand photojournalism. And, for her significant contribution

to the Wellington region and the wider New Zealand Food and

Hospitality community, Ruth Pretty was awarded the Honorary

Bachelor of Hospitality Management.

New values

The Executive Management Team (EMT) did an important piece of

work to define WelTec’s purpose, identity and values so that we are

aligned and ready to meet the opportunities and challenges ahead.

The model we used takes a whole-of-organisation approach to define

aspirational goals and values, while ensuring they are firmly grounded

in the purpose and identity of WelTec.

We aspire to providing the best learning environment.

Our distinguishing characteristic is that we believe

learning happens together.

Our values are empathy, challenge and growth.

We started work with staff on the best way to embed these goals and

values into daily life at WelTec.

Dr. Linda Sissons CNZM

At the end of the year 80 percent of these students achieved NCEA

level 2 (compared to a national average of 69 percent) and over

70 percent achieved a Level 2/3 vocational qualification. The high

retention rate, of a potentially at-risk group of students, showed

high levels of student engagement with the programme, as well as

exceptional staff support and commitment.

External Evaluation and Review

We were pleased with the results of NZQA’s External Evaluation

and Review (EER) of WelTec in 2011. As well as providing a public

statement of confidence in our educational performance and

capability in self-assessment, the EER also helps us build our

quality improvement processes.

The NZQA states that it is Highly Confident in WelTec’s educational

performance. It particularly noted that we had worked proactively

to raise completion measures by focussing on improvement

across all programmes and by paying particular attention to the

most poorly performing programmes and closing, restructuring, or

revamping them.

Our vision and initiatives for working with Maori and Pasifika people

to meet their economic and social development aspirations were

noted, as well as the high regard in which employers hold our

graduates. Our developing research culture, literacy and numeracy

initiatives and supportive learning environment contributed to our

high score.

NZQA is also Confident in our capability in self-assessment.

Aligning our existing annual programme reporting arrangements

with NZQA’s self-assessment methodology no doubt helped

us achieve this level of confidence. Our evaluation workshops,

industry advisory committees, willingness to adapt to industry and

student needs were all evidence of our responsiveness and ability

to self-assess and evolve. The report called the Tamaiti Whangai

initiative an impressive example of self-assessment of an academic

programme and the related learning and pastoral support issues.

Academic programme

The annual review of our programme portfolio has seen the

Academic Board approve a number of programme additions,

redevelopments and closures. This critical assessment ensures

relevance and quality.

We launched the new Bachelor of Youth Development, the first

degree specifically preparing workers in this important emerging

profession in New Zealand. The programme has its own advisory

board, which assisted with its development. The Minister of

Education, Anne Tolley, acknowledged the importance of the

new qualification in supporting young people to overcome the

challenges they face in today’s society and become active and

healthy participants in their communities.


COMMITMENT TO INDUSTRY PARTNERSHIP

While Beca has grown to be one of the larger employee-owned engineering and related consultancy services companies in the Asia-Pacific, it retains strong Wellington connections. These connections include a well-established relationship with WelTec’s engineering faculty.

“We recruit graduates from WelTec’s National Diploma in Engineering and we also contribute to WelTec’s industry Advisory Committee to provide a strong industry perspective,” says Mike Kerr, Beca’s regional manager, Wellington and Chair of WelTec’s Engineering Advisory Committee.

“Being on the advisory committee means we have a say on how WelTec’s courses can meet our needs, now and in the future. For example we provide suggestions on the effectiveness of their course material, to their marketing approach to ensure it attracts high calibre students,” says Mike.

Mike says that WelTec is very proactive in engaging with industry and as a result its graduates have better connections to the engineering industry. “WelTec has relationships with a lot of employers from within the wider Wellington region and these employers will come and speak to students and share their knowledge.”

Mr Kerr said that Beca was also impressed with WelTec’s engagement progress of developing a more standardised offering, along with its flexibility in how it runs courses for its students.

“WelTec’s key point of difference as an education provider is that they are more flexible and accommodating in their approach, and they have a strong regional focus.

“For example we like to employ part-time students as we find that they can apply what they learn, while still learning, and WelTec provides flexibility in its course structure and materials to accommodate their needs,” he says.

Mike says Beca’s strong relationship with WelTec and its commitment to industry partnership means the company can be confident that the skills of WelTec graduates match the needs of this fast-paced, dynamic business.

“My vision for the New Zealand engineering industry is growing our profile as a deliverer of exemplary quality in the global market. To succeed as a small player in this world market we need to continue to focus on niche and very high quality products and services,” says Mike.

“WelTec plays a crucial role in this by providing a high calibre of graduates with strong alignment with our industry’s needs.”


FRONDE’S VISION FOR GRADUATE POSSIBILITIES

Fronde, a Wellington-based IT company has a long history in solving complex IT issues using a customised development approach that has worked successfully with its growing domestic and international customers. For example, Fronde developed the Ministry of Social Development’s online Student Loans system in 1999 and still supports this solution today. It has also had a significant presence in the wholesale electricity market developing systems that have stood the test of time. For a company that’s been in business for 20 years it is not sitting on its laurels.

Fronde’s Chief Executive, Ian Clarke says a real growth area is in cloud computing where it is working with global brands like Google and Salesforce to implement ‘apps’ that make sharing and collaborating on documents much easier for their clients. “It’s about democratising data, making sure data is easily accessible instead of being locked up,” says Ian.

Ian’s vision for Wellington in the IT area covers two key elements. “The IT sector has a pivotal role in transforming government so that is providing more efficient and effective services. Local players like Fronde are an important part of supporting government and getting their IT infrastructure right.”

“The second element is being able to take our services and products to the world and to do that it’s critical that we have a ready supply of smart, trained people.

“We employ a lot of WelTec graduates who come through our intern programme and we notice they tend to have a real vocational interest in IT as opposed to other graduates who may come out of general study and then decide to work in IT,” says Ian. In Ian’s view the advantage of the vocational approach is that WelTec graduates are work ready to the point they can engage directly with clients.

Fronde is one of the local companies represented on WelTec’s Information Technology Advisory Committee and provides the committee with advice on changes in the workplace and industry trends that need to be reflected in its qualifications.

“Industry engagement is critical for Institutions like WelTec and we’re very pleased to be part of the small employer group that gives advice and support on IT trends,” says Ian.

“A key to attracting excellent graduates is being able to create and demonstrate a vision of what they can become, and our partnership with WelTec means Fronde is in a position to do exactly that and show what career possibilities are out there,” says Ian.


The Trades Academy is a good example of a working partnership between school, community, home and WelTec where we are all focused on getting good results for young people, ensuring they get their NCEA credits while studying towards a trade qualification.

KERRY LEGGETT


WORKING PARTNERSHIP FOR YOUTH

Vibe is a youth one-stop-shop that provides a range of health and support services to Hutt Valley young people. Six years ago Vibe established the Youth Transition Service, which supports young people aged between 15 -19 years transition into training, further education and employment. Kerry Leggett is Vibe’s Youth Development Team Leader and as part of her role in engaging with the community, stakeholders and young people, she works closely with the Wellington Trades Academy.

“As a member of the Advisory Committee for the Trades Academy I am part of a team that includes school principals, representatives from other community organisations, employers and the Ministry of Education,” says Kerry.

Kerry says the role of the Committee is to provide a strategic overview to the Academy from an educational perspective, but also to offer practical advice and guidance in how it supports its students.

“The Trades Academy is a good example of a working partnership between school, community, home and WelTec where we are all focused on getting good results for young people, ensuring they get their NCEA credits while studying towards a trade qualification.”

Vibe followed up the destination of 37 Trades Academy students. Ten out of 37 young people Vibe engaged with this year through the Trades Academy gained full-time employment, a significant increase on previous years, while others returned to WelTec for more training. Additionally, Kerry noticed a positive attitude with young people who were happy to engage and get involved.

“The clear message young people are getting from the Trades Academy is that they are employable particularly with an NCEA Level 2 qualification and a pre-trade qualification,” says Kerry. This view is reflected in Kerry’s discussions with school principals who have been positive about the role of the Academy as a practical training option for some students.

“This is an innovative partnership that ultimately is a win for the students, employers and schools looking to provide a strong pathway into a range of industries from mechanical engineering, construction to hairdressing and hospitality.”


WELTEC CONNECT LTD

2011 was the first full year of operation for WelTec’s subsidiary, WelTec Connect Ltd (WCL). As both an investment holding company and a commercial services provider, WCL gives WelTec the opportunity to diversify its revenue. WCL services are primarily research and development and business capability development services for local industry.

WelTec Connect already has 82 companies as clients and contract revenue is growing. Highlights of the year for WelTec Connect included the establishment of a technology alliance with the New Zealand arm of the global multinational NEC Corporation for collaboration on technology research and development and commercial applications. The relationship with NEC includes funding for an applied research fellowship and a student cadetship.

WCL is actively involved in developing new technologies such as blended fuels and ultra-high pressure low-volume water jetting. In 2011 it was the research and development partner for five successful Ministry of Science and Innovation technology transfer voucher projects.

As well as helping WelTec build even stronger relationships with industry, other benefits include student research awards, guest lectures by industry technology specialists, industry-led student projects and new cadetships.


TECHNICAL SUPPORT FOR BIG IDEAS

Inspired by a desire to help address climate change, Joseph van Liempt is working on a product to reuse energy that is usually wasted. Joseph has been working on his Heatback system with WelTec since 2007 and is now at the stage of doing comprehensive trials to prove that his heat exchange product could save a medium-sized household up to $800 per year.

Retired but missing work, former Lower Hutt resident Joseph dusted off the book where he had jotted down product ideas he has had over many years. “At the time, there was a lot of talk about climate change and I thought I wanted to do something to help with that,” says Joseph. “I had the idea for a heat recovery system for household waste water.”

The Heatback is designed to take the heat from water going down the drain and return it to the hot water cylinder. Heatback is designed to be mounted under or near showers, baths and basins. The innovation is to make it small enough for the single story domestic environment, provide fast response returns for short- burst-use and simple enough to use limited resources in its construction.

Joseph did the extensive, global background research necessary to prove that his idea is viable and unique. “There are many heat exchange processes for the industrial environment available but my hope is that Heatback will resolve practical issues of space and cost in homes, which are reported to produce 50 percent of greenhouse gas emissions.

“I worked for 30 years in project management for product development for the engineering and construction industry. So I had some idea how to approach things. What I didn’t have was a 3D printer to produce a negative for the moulded parts, or the most up-to-date knowledge of engineering techniques.”

Joseph describes WelTec Connect as his R&D partner – able to provide the skills and equipment his project was previously lacking.“People like me, with ideas, but who run on the smell of an oily rag can’t invest in some of the tools and expertise to get our ideas off the ground. To find these resources, and the expertise, so close to home was exciting.”

Joseph has now moved to Taupo but continues to work with Andrew Rodger and Roger Dunkley at WelTec Connect. He describes both as patient, as well as extremely knowledgeable. “I would take my technical issues to them and they would know how to solve them. The collaborative approach was great. I know a lot more now than when I started.”

Once the residential Heatback system is proven and working well, Joseph has plans to work with WelTec Connect to further develop the technology so that it can go into other places where energy is wasted.

“I want my grandchildren to breathe pure air and enjoy our planet. If I can contribute to that in some small way, it will all be worth it.”


OUR PEOPLEA number of new initiatives and progress on existing programmes have again

improved working conditions and opportunities for WelTec staff.

New TEU CEA

A focus of the year for the Human Resources team was the successful

negotiation of the Tertiary Education Union Collective Employment Agreement.

Innovative thinking from both parties led to an agreement that will deliver extra

benefits for both parties.

Extended leadership programme

The leadership programme completed by managers in the previous year

was extended to include senior staff who are not managers. This will

increase WelTec’s leadership capability and succession as well as increase

collaboration across different areas of the Institute. Progress has been made

on several collaborative projects that emerged from the programme.

Promoting opportunities and diversity

WelTec implemented a number of initiatives during the year to attract more

Maori and Pacifika applications for positions. Using local networks was one

of the new ways used to advertise positions. Care with the composition of

recruitment panels, a review of interview questions and new mihi whakatau

and powhiri protocols also helped to make WelTec more welcoming and

inclusive for more of the community.

Employer excellence awards

WelTec gained both the Wellington Regional Defence Employer Award and the

National Award for Employer Excellence in the Public Sector for 2011 from the

Territorial Forces Employers Support Council (TFESC). The awards recognise

WelTec as a supportive employer of staff who are also in the territorial forces.

Innovation and research

During 2011 WelTec funded staff to do research; exhibit work; enter or judge

competitions; and attend national and international conferences. Grants

totalled $88,600 in 2011.

OUR ENVIRONMENTWelTec is continuing its journey of environmental sustainability. The Strategic Framework and Environmental Policy developed in 2009 was updated in 2011. The Enviro-Mark® NZ Gold audit was completed in June and WelTec’s Gold status was confirmed. Progress was made on implementing the Environmental Risk Strategy for the Petone campus with developments in the following areas:

Reducing energy use

The new boiler installed in 2010 resulted in a 60 percent reduction in gas consumption by June 2011.

Transport

WelTec continued to implement its Transport Strategy initiatives, including a bus service between Porirua and Petone. A secure bike shed and additional bike racks on campus were put in place, as well as upgraded showers. This encouraged staff and students to cycle, walk or run to campus. Let’s Carpool, a Greater Wellington Regional Council programme was extensively promoted to staff and students.


SHOWCASING MAORI CONTEMPORARY ART

WelTec was proud to provide funds from the Innovation and

Research fund to support Creative Technology tutor, Barry Te Whatu,

Taranaki (Tuuturu) and Ngapuhi, to showcase his work at the Maori

Art Market in 2011. Works by nearly 250 artists were on show at

Te Rauparaha Arena and Pataka Museum.

Barry creates intriguing spinning tops and taurapa (waka stern

posts) many of which are tailor-made one-off commissions – often

having something to say. His work reflects issues of the day, and

incorporates facets of who, or what occasion, the work has been

created for.

With a particular passion for carving in stone, Barry

has participated in more than 30 symposiums and

exhibitions in Aotearoa, the United States, Japan and

Austria. Elements of other cultures and the need to

adapt to different tools and working environments in

foreign countries, have also informed his work.

As well as tutoring, Barry is also a mentor with Tamaiti

Whangai, the initiative that gets alongside young Maori

to help them succeed in their study at WelTec.


BUSINESS PLAN PERFORMANCEWelTec’s Business Plan for 2011 focused on addressing the

key strategic challenges the Institute faces over the three years

from 2011 to 2013. A range of activities was put in place for each

challenge and success has been measured in terms of:

Successful course and qualification achievement

Student retention and progression

Student/graduate destination (into employment or further

study)

Entrepreneurship, knowledge production, innovation

and technology transfer

Revenue earned (particularly directly from industry and

from new sources)

Industry endorsement/status

It was a challenging year for WelTec. We experienced not only the

ongoing effects of the removal of trades/technical capital support

but also, in our goal to maximise trades/technology EFTS and

occupancy of equipment and facilities, an unexpected requirement

to deliver three percent unfunded EFTS in order to earn extra trades

EFTS for the Skills for Canterbury initiative. Delivery of a 3.5 percent

financial surplus in this environment was pleasing.

Challenge 1: Growing commercial and non-government revenue

A total of $871,000 was raised from commercial and non-

government revenue. While this was short of the budgeted $1M, it is

74 percent up on 2010.

Challenge 2: Growing international students and revenue

Budgeted revenue and international student targets were not

achieved, with 305 international student EFTS against a budgeted

340. As well as the challenging economic environment, immigration

issues had an impact on enrolments. An external review of our

international operation and resulting new initiatives indicate potential

improvement in numbers for 2012.

Pleasingly, the academic performance of international students well

exceeded targets. Marketing WelTec’s academic quality will be a

priority in the future.

Challenge 3: Developing Campuses to Support Future Delivery

We made significant progress on campus development initiatives,

including progress on the Centre for Cuisine and Hospitality

Excellence and new facilities in Otaki and Masterton for the delivery

of carpentry training in support of the Skills for Canterbury initiative.

We started work to develop concepts for more flexible, multi-purpose

technology-integrated spaces, particularly in the trades/technical

area on the Petone campus.

Challenge 4: Managing financial assets to ensure sustainability

The over-budget financial performance for the year reflects our

investment plan EFTS exceeding target by two percent and the TEC

SAC portion at 103.8 percent of our SAC dollar value allocation.

The end of year cash balance was higher than budget because

capital expenditure was under-spent as a result of unavoidable

delays in some major building projects.

Challenge 5: Assisting Maori, Pasifika and young people to achieve in tertiary education

There was a pleasing increase in participation rates of Maori,

Pasifika and young people. Educational performance for the

under-25s exceeded our target, but was under target for Maori and

Pasifika. Extra resources were added to support learners in these

three categories and there will be ongoing emphasis on improving

outcomes for these groups.

Challenge 6: Raising educational performance

Participation and educational performance were largely on target

for the year, with only a small underachievement in performance at

levels four and above. There is a drive across WelTec to improve

outcomes for students and this will continue.

An improved, more-timely reporting process helped us better

analyse the programme portfolio, which is constantly under scrutiny

with an emphasis on addressing under-performing programmes.

Challenge 7: Maintaining a centre of excellence in trades and technology and ensuring programme delivery is sustainable

The emphasis in 2011 was on ensuring that the delivery of trades

programmes was financially and academically sustainable. Trades

training was delivered to a very diverse student population, with

delivery of training at Rimutaka Prison, marae-based training in the

Wairarapa and the introduction of the Trades Academy. The Skills for

Canterbury initiative widened the market along with special initiatives

for Maori and Pasifika students through Te Puni Kokiri, the Ministry of

Pacific Island Affairs and Pacific churches.

Also in 2011 the Faculty of Trades and Technology investigated how

it could update teaching methods, improve teaching and learning

resources, introduce new technology and improve the capability of

teaching staff.


Challenge 8: Developing a unique WelTec delivery style that incorporates face-to-face and technology-facilitated learning to assist achievement

In 2011, work continued on increasing our course delivery flexibility.

We gained access to the Moodle learning management system

as a result of a collaborative arrangement with Whitireia. A student

e-portfolio, Pebblepad, was introduced into the Bachelor of Youth

development to help students manage journals and for work to be

assessed.

In November, WelTec held a Teaching and Learning Forum. Teaching

staff gave presentations to their peers on teaching delivery styles

and the use of new technology to help learners.

Staffing

Our emphasis on quality was supported by our decision to offer

the CPIT Diploma in Adult Teaching as the minimum teaching

qualification requirement for teaching staff.

Over 67 staff attended one or more “Getting on with Teaching”

sessions. These workshops bring new staff on board with the WelTec

teaching approach and offer a refresher for existing staff.

High-quality research, innovation and technology transfer activities that inform teaching

There was a significant increase in research activity over the year.

This is referred to in the Statement of Objectives and Service

Performance section of this report.

Maintaining an Institutional profile

2010 2011 Target

2011 Q4

Total FTEs (Full time Staff Equivalents) 396.82 395 402

Academic FTEs 201.82 205 205

Administration FTEs 195 190 197

Academic: Administration FTE 1.04:1 1.1:1 1.04:1

EFTS: Academic FTE 21.5:1 22 23:1

EFTS: Administration FTE 22.3:1 23 24:1

STAFFING

Administration Systems

Progress was made on the implementation of the Information

Systems Strategic Plan. The emphasis this year was on ensuring

IT and IS solutions and capability meet business needs. Feedback

has shown a clear improvement in the engagement, approach and

accessibility of IT staff.

The Data Warehouse project was revised to focus on delivering

high-level information for managers and key staff so they can make

crucial business decisions.

Progress was also made on defining the core processes that make

up the end-to-end ‘student lifecycle’ in order to better understand

and improve them. The results process was the first to be addressed

and will provide a consistent framework for tutors to record and

manage student assessment results.

2010 2011 Target 2011 Q4

Greater Wellington RegionUnprompted

61.4%(incl. 76% in 18-24 age group)

70% 68%

Prompted98.8%

(100% in 18-24 age group)

100% 99%

Six regional/national significant events held and profiled

3 6 10

We exceeded the number of significant events targeted for the year,

with events such as the annual business breakfast and the Beehive

launch of the Bachelor of Youth Development attracting positive

attention and accolades for WelTec’s responsiveness to industry and

community needs.


RESEARCH

In 2011 we built on the distinctive characteristics of our applied problem-based research approach. Our focus is on working closely with business and industry, especially small and medium sized businesses, to develop and deliver creative, technology and knowledge-based solutions that meet specific needs. This research makes a direct contribution to smaller businesses, their productivity and their contribution to economic development.

WelTec’s unique research culture fosters industry partnerships and an understanding of business needs. This approach is illustrated in the three WelTec researchers whose work is showcased here. Their research work also benefits WelTec students and contributes to our teaching and learning practice. WelTec’s approach to research delivers benefits for students, contributes to our industry partners and offers professional and academic development for staff.

For further information on research undertaken by WelTec please refer to our 2011 Annual Research Report.


TODD COCHRANE, NEC RESEARCH FELLOW

A nine month secondment as WelTec’s first NEC fellow is providing Todd Cochrane with a great opportunity to undertake research with NEC, a leading global manufacturer and service provider of telecommunication, computer and electronic devices.

“The NEC/WelTec fellowship is new and I’m honoured to be its first recipient,” says Todd. “NEC New Zealand has about 40 current research projects and I’m working on an exciting technology project in the area of pervasive interface development for a personal robot.”

Todd’s been at WelTec since 2001, teaching at the School of Information Technology where his current role is Programme Coordinator. He holds a BSc Hons specialising in Computer Science and is currently studying towards a PhD in Education.

“I think it’s important to keep learning and to maintain professional memberships including working in partnership with industry, both at a practical and research level.” Todd cites several examples of this including his recent work with a Portuguese artist and academic specialising in dance technology. Todd’s role in this project is as a discipline expert where his involvement enabled many aspects in the IT domain, for example the transfer of data into a 3D, virtual world.

“My research gets incorporated into the courses I run at WelTec, for example in the Human Computer Interaction course our projects are focused on developing in the virtual world environment.”Another example is his work with the Hong Kong government company Incutrain Cyberport, developing an interactive art sculpture that will be shown at an upcoming international software conference International Soft China, in Beijing.

“Staff research and proactive work with industry is hugely beneficial to our students who work at a national and international level, and in a way that develops their capacity for creative solutions,” says Todd. It is this sort of approach which ensures WelTec’s students are well-equipped to contribute to an expanding and dynamic IT industry.


My research gets incorporated into the courses I run at WelTec, for example in the Human Computer Interaction course our projects are focused on developing in the virtual world environment.

TODD COCHRANE


CREATIVE RESEARCH

According to Lorraine Rastorfer, Senior Visual Arts Lecturer, WelTec’s Bachelor of Creative Technology offers students a unique opportunity to gain an interdisciplinary understanding of the arts across a wide range of subjects. “The degree is structured so the ‘core’ courses can be shared across all creative technology disciplines,” says Lorraine. “We actively encourage students to learn how to collaborate across the different disciplines on a range of projects, within the core ‘collaborative projects’ course. For example that could see visual arts students working with students specialising in animation, working alongside students studying cultural and interior design all acting as a team on a ‘real’ industry project.

Lorraine’s area of expertise is visual arts. She holds a Masters of Fine Arts (Hons) from Auckland University, and has exhibited in solo and group shows regularly since 1990. Today her work is represented in many corporate and private collections in Japan, Australia, USA, Austria and New Zealand.

Lorraine’s hands-on experience in exhibiting her art is a real advantage for students interested in following a creative career path.

I teach a paper called exhibition and I’ve been able to give them real examples of how they work at all levels, from developing a theme to holding contract discussions with gallery owners. says Lorraine.

She adds that she always makes a point of sharing what she is working on with her students. For example her last two solo exhibitions occurred three months apart, the first in Dunedin and the second in Wellington, at Mark Hutchins Gallery.

“The local exhibition at Mark Hutchins Gallery, in Willis Street meant I was able to bring students along and talk about the art work on-site and engage the Gallery director in discussions as well as demonstrate the practical aspects to staging an exhibition.

Lorraine collates and documents all the information from her exhibitions, as these are representative of ‘research outputs’ for her School and WelTec. “Being able to conduct creative research, through my work in the studio and in the exhibitions that follow has helped fuel my passion for teaching,” says Lorraine. “It brings a very real experience and practical advice to the table.”

“I am very fortunate that WelTec supports my creative endeavours which in turn gives our students a hands-on approach to all aspects of visual and creative arts and builds strong connections with creative industries, especially in the wider Wellington region.“


RESEARCH SUPPORTS CLEAR AND ROBUST RELATIONSHIP

WelTec students who have Susan Townshend as a lecturer are in the fortunate position of benefiting from her dual expertise across two disciplines; hospitality and finance. Susan is both a qualified chef, having owned her own catering business for many years, and more recently completing accounting qualifications and becoming a financial officer at the Inland Revenue in the United Kingdom. Her combination of skills is perfect for her role as a senior lecturer on the Bachelor of Hospitality programme focused on financial management. It has also seen her take an innovative approach to how she teaches and connects with her students.

“It’s important to keep communication channels open with students and I like to use all the tools available to do this,” says Susan. This includes using online channels such as chat rooms, live audience rooms and video screen casts, which appeal to students who are completely familiar with these channels.

Susan’s willingness to go the extra mile with students extends to her engagement with employers in the hospitality industry.

“Understanding the needs of industry is a critical part of my role and so I regularly undertake research projects aimed at gauging industry trends and identifying future skills,” says Susan. “This was particularly relevant as WelTec developed its new degree programme in hospitality.”

Susan’s more recent research projects included contacting employers to identify current and future competency and skills using a database provided by the Hospitality Standards Institute. Another research project analysed the effects of the recession on Wellington’s food and beverage outlets.

“The data gathered from these research projects has been very helpful in understanding the challenges employers’ face, what they are looking for from employees, and in helping us shape our courses to suit any emerging trends.

Susan says the research and regular contact with employers includes contact with past students who are now working in the industry. “We are very fortunate to be able to show existing students where some of our graduates are working. It’s a great way of showing the diverse range of careers in the industry.

For Susan, one of WelTec’s strengths is its “clear and robust relationship it has with industry” and she is part of a team committed to maintaining those relationships by researching and listening to the key businesses and individuals that make up Wellington’s hospitality industry.

“The clear message from the hospitality industry is it wants an “industry-ready student” and we know we can deliver exactly that”.


Investment Plan Performance Commitments

WelTec has agreed to use the following Key performance

Indicators and Targets to measure its performance over the three

years of the 2011 to 2013 Investment Plan.

Actual 2010 Target 2011 Actual 2011

Proportion Maori 17% 17% 18%

Levels 1 - 3 6% 5% 8%

Levels 4 and above 11% 12% 11%

Proportion Pasifika 10% 9.4% 10.1%

Levels 1 - 3 3% 2.2% 4.5%

Levels 4 and above 6% 7.2% 5.6%

Proportion aged under 25 60% 61% 63%

Levels 1 - 3 19% 17% 21%


Priority Groups – Participation

STATEMENT OF OBJECTIVES AND SERVICE PERFORMANCE

NOTE: Weighted qualification completions report qualifications awarded

from 2011 to date. Qualifications will continue to be awarded in coming

months as practicum and other experiential requirements are completed.

The 2010 Actuals reflect 2010 qualifications awarded by the mid Year TEC

EPI reporting dates.

Measures for SAC1 funded business

1 Includes Youth Guarantees


Weighted course completions 74% 76% 76%

Levels 1 - 3 70% 72% 72%


Weighted qualification completions 64% 65% 62%

Levels 1 - 3 66% 62% 63%


Student retention 61% 53% 65%

Student progression (levels 1 – 4) 39% 39% 40%2

Educational Performance

Priority Groups – Maori Learners 60% 61% 63%


Levels 1 - 3 58% 65% 66%



Levels 1 - 3 57% 58% 57%


Priority Groups – Pasifika learners 60% 61% 63%


Levels 1 - 3 65% 68% 64%


2 This figure from TEC reporting does not include Youth Guarantee students




Levels 1 - 3 63% 58% 52%


Educational Performance

Priority Groups – Learners aged under 25 60% 61% 63%


Levels 1 - 3 69% 72% 71%



Levels 1 - 3 66% 62% 60%



Student satisfaction 91% 96% 90%

Maori 94% 98% 95%

Pasifika 95% 92% 95%

Under 25s 91% 92% 91%

Student indicators


Number EFTS achieved 301 340 305



Student satisfaction 93% 98% 84%

Participation

International Business


Proportion graduates gaining employment or going on to further study 3

66% (an additional 31%

were looking for employment)

85%

70% (an additional 29% were work ready)

Relevant qualifications 4 88% 100% 90%

Work readiness of WelTec graduates 5 90% 95% 89%

Programme Portfolio 10% 9.4% 10.1%

The proportion of course EFTS at levels 1 to 3 that have embedded literacy and numeracy 62% 85% 96%

Proportion of programme portfolio in vocationally-related education and/or training 100% 100% 100%

Proportion of portfolio endorsed by industry

Industry input is a component for all

Programmes during the Approval process

100%

Industry input is a component for all

Programmes during the Approval process

Proportion of portfolio in programmes that lead to a qualification on the national qualifications framework 6 N/A 100% 100%

Relevance

Whole of organisation indicators

3 As assessed by annual graduate destination survey4 As assessed by annual Employer Satisfaction Survey5 As assessed by annual Employer Satisfaction Survey6 Based on qualifications registered under new criteria established in 2010



Number of research outputs – Total 182 200 197

Industry related 35 42 59

Quality assured 46 80 68

Weighted points N/A 360 366

Number of technology transfer activities completed 40 55 54

External revenue gained(Research contracts and PBRF income) ($,000) $250 $450 $525

Research and technology transfer


Proportion of SAC funding achieved 98.4% 100% 104%

Total EFTS achieved 4,350 4,482 4,669

SAC# 3,001 3,028 3,175

International 301 350 305

ITO 607 590 611

Youth *

366(81 Youth Guarantee

285 STAR)

454(114 Youth Guarantee100 Trades Academy

250 STAR)

481(108 Youth Guarantee77 Trades Academy

295 STAR)

Full fees 75 50 97

ACE (Adult and Community Education) 93 48 50

Risk rating against Financial Monitoring Framework Low Low Low

Extent of improvements in Attributes as per CAMS Improvement Plan N/A As agreed with TEC

CAMS technical solution implements. Description of assets improvement

plan underway and asset information

improvement is on track

Financial performance

# Includes SAC and ACE but not Youth Guarantees* STAR, Trades Academy, Youth Guarantees


CONTENTS

Statement of Comprehensive Income

Statement of Changes in Equity

Balance Sheet

Cash Flow Statement

Notes to the Financial Statements

FINANCIAL STATEMENTS


STATEMENT OF COMPREHENSIVE INCOMEFor the year ended 31 December 2011

Note 2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

Government Funding 2 28,988 28,095 30,451 28,642 28,095 30,451

Tuition Funding 3 16,392 17,010 15,161 16,392 17,010 15,161

Other Teaching 4 4,126 3,570 3,705 3,744 3,570 3,705

Other Income 5 3,080 2,189 4,028 2,935 1,189 4,028

Total Operating Income 52,586 50,864 53,345 51,713 49,864 53,345

Cost of Services

Personnel 6 29,882 28,341 28,290 29,441 28,114 28,290

Teaching Delivery 3,477 3,493 3,225 3,399 3,373 3,225

Administration 7 7,040 6,473 7,923 6,617 6,042 7,923

Infrastructure 8 5,109 5,029 4,904 5,063 5,007 4,904

Interest, Depreciation & Amortisation 9 5,248 5,834 5,404 5,248 5,834 5,404

Total Cost of Services 50,756 49,170 49,746 49,768 48,370 49,746

Operating Profit 1,830 1,694 3,599 1,945 1,494 3,599

Non Operating Items income/(expense) 10 1,247 331 (395) 1,247 331 (395)

Share of associates profit/(loss) 13 (312) (570) (138) - - -

Profit 2,765 1,455 3,066 3,192 1,825 3,204

Other Comprehensive Income

Gain on property revaluation 1,417 - 1,351 1,417 - 1,351

Gain on equipment revaluation - - 26 - - 26

Total comprehensive income 4,182 1,455 4,443 4,609 1,825 4,581

Operating Income

The accompanying notes form part of these financial statements

GROUP PARENT


STATEMENT OF CHANGES IN EQUITYFor the year ended 31 December 2011


2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

Balance at 1 January 68,642 67,086 64,099 68,780 67,224 64,099

Comprehensive income

Profit 2,765 1,455 3,066 3,192 1,825 3,204

Other comprehensive income 1,417 - 1,377 1,417 - 1,377

Total comprehensive income 4,182 1,455 4,443 4,609 1,825 4,581

Non-comprehensive income items

Crown equity injection 22 400 - 100 400 - 100

Total non-comprehensive income items 400 - 100 400 - 100

Balance at 31 December 73,224 68,541 68,642 73,789 69,049 68,780


GROUP PARENT


BALANCE SHEETAs at 31 December 2011


2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

Cash and cash equivalents 16,214 7,465 14,468 16,181 7,465 14,468

Trade and other receivables 11 7,215 6,314 6,981 7,318 6,114 6,981

Inventory 12 306 5 32 306 5 32

Prepayments 12 - 16 12 - 16

Other financial assets 15 - - - 3,150 - -

Total current assets 23,747 13,784 21,497 26,967 13,584 21,497

Non current assets

Investment in associate 13 2,700 2,442 3,012 - - -

Other financial assets 15 - - - - 3,150 3,150

Property, plant and equipment 16 60,139 62,854 58,576 60,139 62,854 58,576

Intangible assets 17 1,117 851 1,205 1,106 851 1,205

Total non current assets 63,956 66,147 62,793 61,245 66,855 62,931

Total assets 87,703 79,931 84,290 88,212 80,439 84,428

Current liabilities

Trade and other payables 18 5,314 3,922 5,410 5,284 3,922 5,410

Employee Benefits 20 2,842 2,219 2,767 2,816 2,219 2,767

Income in Advance 19 6,083 5,061 6,298 6,083 5,061 6,298

Total current liabilities 14,239 11,202 14,475 14,183 11,202 14,475

Non current liabilities

Provisions 21 236 184 1,169 236 184 1,169

Other 4 4 4 4 4 4

Total non current liabilities 240 188 1,173 240 188 1,173

Total liabilities 14,479 11,390 15,648 14,423 11,390 15,648

Net assets 73,224 68,541 68,642 73,789 69,049 68,780

Equity

Crown equity 22 39,332 38,932 38,932 39,332 38,932 38,932

Retained earnings 23 9,647 8,158 6,882 10,212 8,666 7,020

Reserves 24 24,245 21,451 22,828 24,245 21,451 22,828

Total equity 73,224 68,541 68,642 73,789 69,049 68,780

Current assets


GROUP PARENT


CASH FLOW STATEMENTFor the year ended 31 December 2011


2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

Receipts from customers 50,875 49,418 52,066 50,177 49,418 52,066

Interest received 700 373 593 845 373 593

Payments to suppliers and employees (45,390) (43,423) (43,546) (44,888) (43,423) (43,546)

GST (net) (328) (68) 388 (321) (68) 388

Net cash provided by/(used in) operating activities 25 5,857 6,300 9,501 5,813 6,300 9,501

Cash flows from investing activities

Proceeds from sale of property, plant and equipment - - 321 - - 321

Payment for property, plant and equipment (4,052) (11,167) (3,314) (4,052) (11,167) (3,314)

Payment for intangible assets (459) (290) (982) (448) (290) (982)

Payment of loan to subsidiary - - (3,150) - - (3,150)

Net cash provided by/(used in) investing activities (4,511) (11,457) (7,125) (4,500) (11,457) (7,125)

Cash flows from financing activities

Proceeds from equity injection 400 - 100 400 - 100

Net cash provided by financing activities 400 - 100 400 - 100

Net increase (decrease) in cash and cash equivalents 1,746 (5,157) 2,476 1,713 (5,157) 2,476

Cash and cash equivalents at the beginning of the financial year 14,468 12,622 11,992 14,468 12,622 11,992

Cash and cash equivalents at the end of the financial year 25 16,214 7,465 14,468 16,181 7,465 14,468

Represented by:

Cash at bank and in hand 1,714 465 468 1,681 465 468

Term deposits - ASB Bank 14,500 7,000 11,500 14,500 7,000 11,500

Term deposits - BNZ - - 2,500 - - 2,500

16,214 7,465 14,468 16,181 7,465 14,468

The GST (net) component of operating activities reflects the net GST paid to and received from Inland Revenue. The GST (net) component has been

presented on a net basis as the gross amounts do not provide meaningful information for financial statement purposes and to be consistent with the

presentation basis of the other primary financial statements.


Cash flows from operating activities

GROUP PARENT


NOTES TO THE FINANCIAL STATEMENTS1 STATEMENT OF ACCOUNTING POLICIES FOR THE YEAR ENDED 31 DECEMBER 2011

Reporting Entity

Wellington Institute of Technology (WelTec) is a Crown Entity

governed by the Crown Entities Act 2004 and the Education Act

1989. It provides full-time and part-time tertiary education in New

Zealand. WelTec and Group consists of Wellington Institute of

Technology and its subsidiary WelTec Connect Limited (100%

owned). WelTec Connect Limited has a 43.15% interest in Le

Cordon Bleu New Zealand Institute Limited Partnership which is

equity accounted. WelTec also has a 50% interest in Cybus an

unincorporated joint venture which is equity accounted into the

Group financial statements. The financial statements of Wellington

Institute of Technology (WelTec) and Group for the year ended 31

December 2011 were authorised for issue in accordance with a

resolution of the Council on 24 April 2012.

Statement of Compliance

The financial statements comply with New Zealand Generally

Accepted Accounting Practice (NZ GAAP), which includes New

Zealand equivalents to International Financial Reporting Standards

(‘NZ IFRS’) and other applicable financial reporting standards as

appropriate for public benefit entities.

Basis of Preparation

The financial statements have been prepared in accordance with

NZ GAAP in New Zealand, and the requirements of the Crown

Entities Act 2004 and the Education Act 1989. Wellington Institute of

Technology and Group is a public benefit entity for the purpose of

complying with NZ GAAP in New Zealand. The financial statements

have been prepared on a historical cost basis, except for land,

buildings and equipment, which have been measured at fair value.

The financial statements are presented in New Zealand dollars

and all values are rounded to the nearest thousand dollars ($’000),

except where indicated. Nil values are reflected as a ‘-‘ within these

financial statements.

Significant Accounting Policies

Basis of consolidation

The Group financial statements are prepared by adding together

the like items of assets, liabilities, equity, income, expenses and

cash flows on a line by line basis. All significant intragroup balances,

transactions, income, and expenses are eliminated in full on

consolidation.

Subsidiaries

WelTec consolidates in the Group financial statements all entities

where the Institute has the capacity to control the financing and

operating policies of an entity so as to obtain benefits from the

activities of the entity. Investments in subsidiaries are carried at cost

in the WelTec parent entity financial statements.

Associate

WelTec associate investment is accounted for in the Group financial

statements using the equity method. An associate is an entity

over which WelTec has significant influence and that is neither a

subsidiary nor an interest in a joint venture. The investment in an

associate is initially recognised at cost and the carrying amount is

increased or decreased to recognise the Group’s share of the profit

or loss of the associate after the date of acquisition. The Group’s

share of the profit or loss is recognised in the Group profit or loss.

Distributions received from an associate reduce the carrying amount

of the investment in the Group financial statements.

If the share of losses of an associate equals or exceeds an interest in

the associate, the Group discontinues recognising its share of further

losses. After the Group’s interest is reduced to zero, additional

losses are proved for, and a liability is recognised, only to the extent

that the Group has incurred legal or constructive obligations or made

payments on behalf of the associate. If the associate subsequently

reports profits, the Group will resume recognising its share of those

profits only after its share of the profits equals the share of losses not

recognised.

Where the Group transacts with an associate, profit or losses

are eliminated to the extent of the Group’s interest in the relevant

associate. Investments in associates are carried at cost in the WelTec

parent entity financial statements.

Joint Venture

WelTec’s jointly controlled entity interest is accounted for using the

equity method. Investments in jointly controlled entities are carried at

cost in the WelTec parent entity financial statements.

Budget Figures

The budget figures are those approved by the Council at the

beginning of the financial year. The budget figures have been

prepared in accordance with NZ GAAP and are consistent with the

accounting policies adopted by the Council for the preparation of the


Cost of Services

WelTec and Group has presented an analysis of its cost of services

on the face of the Statement of Comprehensive Income and within

the notes to the accounts utilising a classification based on the

underlying nature of the expenses.

Cash and Cash Equivalents

Cash and cash equivalents comprise cash on hand, cash in

banks and investments in money market instruments, net of any

outstanding bank overdrafts.

Comparative Figures

When the presentation or classification of items in the financial

statements has been amended, comparative amounts have been

reclassified.

Employee Benefits

Employee benefits that are due to be settled within 12 months

after the end of the period in which the employee renders the

related service are measured at nominal values based on accrued

entitlements at current rates of pay. These include salaries and


Goods and Services Tax

All items in the financial statements are stated exclusive of goods

and services tax (GST), except for trade and other receivables

and trade and other payables, which are presented on a GST-

inclusive basis. Where GST is not recoverable as input tax then it is

recognised as part of the related asset or expense.

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

Revenue is included as part of receivables or payables in the

Balance Sheet.

The net GST paid to, or received from Inland Revenue, including the

GST relating to investing and financing activities, is classified as a

net operating cash flow in the statement of cash flows.

Commitments and contingencies are disclosed exclusive of GST.

Impairment of Assets

At each reporting date, WelTec and Group reviews the carrying

amounts of its tangible and intangible assets to determine whether

there is any indication that those assets have suffered an impairment

loss.

Loans and receivables

Impairment of a loan or a receivable is established when there is

objective evidence that WelTec and Group will not be able to collect

amounts due. Significant financial difficulties of the debtor, probability

that the debtor will enter into liquidation or default on payments are

considered indicators that the asset is impaired.

For debtors and other receivables the carrying amount of the asset is

reduced through the use of an allowance account, and the amount

of the loss is recognised in the profit or loss. When the receivable is

uncollectable, it is written off against the allowance account. Overdue

receivables that have been renegotiated are reclassified as current

(that is, not past due).

Other Financial Assets, Property, Plant and Equipment

If any indication of impairment exists, the recoverable amount of the

asset is estimated in order to determine the extent of the impairment

loss (if any). Where the asset does not generate cash flows that are

independent from other assets, the recoverable amount from the

cash-generating unit to which the asset belongs is estimated.

Recoverable amount is the higher of fair value less costs to sell and

value in use. In assessing value in use, the estimated future cash

flows are discounted to their present value, using a discount rate that

reflects current market assessments of the time value of money.

If an asset’s carrying amount exceeds its recoverable amount,

the asset is impaired and the carrying amount is written-down to

the recoverable amount. For revalued assets the impairment loss

is recognised in other comprehensive income to the extent the

impairment loss does not exceed the amount in the appropriate

revaluation reserve. Where that results in a debit balance in the

revaluation reserve, the balance is recognised in the profit or loss.

For assets not carried at a revalued amount, the total impairment

loss is recognised in the profit or loss.

wages accrued up to balance date, annual leave earned but not yet

taken at balance date and sick leave.

A liability for sick leave is recognised to the extent that absences

in the coming year are expected to be greater than the sick leave

entitlements earned in the coming year. The amount is calculated

based on the historical average amount of additional days used by

staff to cover those future absences.

A liability and an expense is recognised for bonuses, where there is a

contractual obligation.

Long term employee entitlements

Employee benefits that are due to be settled beyond 12 months

after the end of the period in which the employee renders the related

service, such as long service leave and retirement leave have been

calculated on an actuarial basis. The calculations are based on:

Likely future entitlements accruing to staff, based on years

of service, years to entitlement, the likelihood that staff

will reach the point of entitlement, and contractual entitlement

information; and

The present value of the estimated future cash flows.

Expected future payments are discounted using the official cash

rate. The inflation factor is based on the expected long-term increase

in remuneration for employees.

Presentation of employee entitlements

Sick leave, annual leave, long service leave and retirement leave

expected to be settled within 12 months of balance date are

classified as a current liability. All other employee entitlements are

classified as a non-current liability.

Equity

Equity, being the difference between total assets and total liabilities

reflects the Crown’s interest in WelTec and Group. This public equity

is disaggregated and classified into a number of reserves to enable

clearer identification of the specific uses/sources of accumulated

funds. The components of equity are:

Notional equity

Retained earnings

Reserves

Financial Instruments

Financial instruments arise as a result of the daily operation of

WelTec and Group and include: cash and cash equivalents,

receivables, payables, investments and non-current liabilities, all

recognised in the Balance Sheet using the concepts of accrual

accounting. Revenues and expenses in relation to all financial

instruments are recognised in the Statement of Comprehensive

Income.

Foreign Currency Translation

Both the functional and presentational currency of WelTec and Group

is in New Zealand dollars ($).

All foreign exchange currency transactions during the financial year

are brought to account using the exchange rate in effect at the day

of the transaction. Exchange rate differences are recognised in the

Statement of Comprehensive Income in the period in which they

arise. 572011 ANNUAL REPORT |

The reversal of an impairment loss on a revalued asset is credited

to other comprehensive income and increases the applicable

revaluation reserve, unless an impairment loss was previously

recognised in the profit or loss, in which case the reversal of the

impairment loss is also recognised in the profit or loss.

For assets not carried at revalued amount the reversal of an

impairment loss is recognised in the profit or loss.

Intangible Assets

Intellectual property costs

Development costs for new intellectual property internally developed

or acquired which have a benefit of more than 1 year have been

capitalised. Such costs are expected to be recovered, and are

amortised on a straight-line basis over the period of their expected

useful lives, being 3 years.

Software

All software purchased or created by WelTec and Group which have

a benefit of more than 1 year have been capitalised. Such costs are

expected to be recovered, and are amortised on a straight-line basis

over the period of their expected useful lives, being 3 years.

Assets under construction

Course development and software assets under construction are

treated as an intangible asset until completion. Upon completion of a

project, the total cost is transferred to the appropriate asset class, at

which point amortisation begins.

Inventories

Inventories available for resale are valued at the lower of cost and net

realisable value. Consumables are recorded at cost.

Investments

Investments are initially recognised at cost, being the fair value of

the consideration given. After the initial recognition, investments

which are classified as available-for-sale are measured at fair

value. Investments that are intended to be held-to-maturity are

subsequently measured at amortised cost using the effective interest

method. Amortised cost is calculated by taking into account any

discount or premium on acquisition, over the period to maturity.

Any changes in fair value through out the term of the investment are

recognised within the Statement of Comprehensive Income.

Leased Assets

Operating lease payments, where the lessor effectively retains

substantially all the risks and rewards of ownership of the leased

items, are recognised as an expense on a straight-line basis over the

lease term.

Payables

Trade payables and other accounts payable are recognised when

WelTec and Group becomes obliged to make future payments

resulting from the purchase of goods and services.

Other Financial Assets

Financial assets are initially recognised at historical cost. Financial

assets are derecognised when the rights to receive cash flows

from the financial assets have expired or have been transferred and

WelTec and the Group has transferred substantially all the risks and

rewards of ownership.

Financial assets are classified into the following categories for the

purposes of measurement:

Loans and receivables

Loans and receivables are non-derivative financial assets with

fixed or determinable payments that are not quoted in an active

market. Related party receivables that are repayable on demand

are classified as a non-current asset because repayment of the

receivable is not expected within 12 months of balance date.

Property, Plant and Equipment

Land and buildings

Land and buildings are measured at fair value. Fair value is

determined on the basis of an annual independent valuation

prepared by registered valuers. Land values are based on

discounted cash flows or capitalisation of net income (as

appropriate). Buildings are valued based on depreciated

replacement cost. This methodology is an acceptable estimate of

fair value due to the lack of market-based evidence for education

delivery purposes.

Any revaluation increase arising on the revaluation of land and

buildings is credited to the appropriate revaluation reserve, except

to the extent that it reverses a revaluation decrease for the same

asset previously recorded as an expense in the Statement of

Comprehensive Income, in which case the increase is credited to the

Statement of Comprehensive Income to the extent of the decrease

previously charged. A decrease in carrying amount arising on the

revaluation of land and buildings is charged as an expense in the

Statement of Comprehensive Income to the extent that it exceeds the

balance, if any, held in the asset revaluation reserve.

Equipment

Equipment is measured at fair value. Fair value is determined on the

basis of a 3 yearly independent valuation prepared by registered

valuers based on discounted cash flows every three years.

Any revaluation increase arising on the revaluation of equipment is

credited to the appropriate revaluation reserve, except to the extent

that it reverses a revaluation decrease for the same asset previously

recorded as an expense in the Statement of Comprehensive

Income, in which case the increase is credited to the Statement of

Comprehensive Income to the extent of the decrease previously

charged. A decrease in carrying amount arising on the revaluation

of equipment is charged as an expense in the Statement of

Comprehensive Income to the extent that it exceeds the balance, if

any, held in the asset revaluation reserve.

Other property, plant and equipment

All other property, plant and equipment is recognised as an asset

if, and only if, it is probable that future economic benefits or service

potential associated with the item will flow to WelTec and Group and

the cost of the item can be measured reliably.

An item of property, plant and equipment is stated at cost less

accumulated depreciation and impairment. Cost includes

expenditure that is directly attributable to the acquisition of the

item. In the event that settlement of all or part of the purchase

consideration is deferred, cost is determined by discounting the

amounts payable in the future to their present value as at the date of

the acquisition.


Revenue

Revenue is recognised to the extent that it is probable that the

economic benefits will flow to WelTec and Group and the revenue

can be reliably measured. The following specific criteria must also be

met before revenue is recognised:

Government grants

Government grants are recognised when eligibility to receive the

grant has been established. For Student Component Funding,

entitlement is established upon the withdrawal period for an

individual’s course of study having passed. For project-based

grants, entitlement is established upon the completion of agreed

milestones. Where funds have been received but not earned at

balance date, an Income in Advance liability is recognised.

Student tuition fees

Revenue from student tuition fees is recognised in the Statement of

Comprehensive Income on entitlement.

Rendering of services

Revenue from a contract to provide services is recognised by

reference to the stage of completion of the contract at the Balance

Sheet date.

Interest revenue

Interest revenue is recognised on a time-proportionate basis that

takes into account the effective yield on the financial asset.

Taxation

Tertiary institutions are exempt from payment of income tax, as

they are treated by the Inland Revenue Department as charitable

organisations. Accordingly, no income tax is provided for.

Critical accounting estimates and assumptions

In preparing these financial statements, WelTec and Group has

made estimates and assumptions concerning the future. These

estimates and assumptions may differ from the subsequent actual

results. Estimates and assumptions are continually evaluated and

are based on historical experience and other factors, including

expectations or future events that are believed to be reasonable

under the circumstances. The estimates and assumptions that have

a significant risk of causing a material adjustment to the carrying

amounts of assets and liabilities within the next financial year are

discussed below:

Land and buildings valuation

Note 16 provides information about the estimates and assumptions

exercised in the measurement of revalued land, buildings and

equipment.

Retirement leave

Note 20 provides information about the estimates and assumptions

exercised in the measurement of retirement leave.

Assets under construction

Assets under construction are disclosed separately. Upon

completion, the asset’s total cost is transferred to the appropriate

asset class, at which point depreciation begins. Disposals gains

and losses on disposals are determined by comparing the disposal

proceeds with the carrying amount of the asset. Gains and losses on

disposals are reported net in the profit or loss. When revalued assets

are sold, the amounts included in revaluation reserves in respect of

those assets are transferred to general funds.

Depreciation

Depreciation has been provided on all property, plant and

equipment, excluding land. Depreciation is calculated on a straight-

line basis, at rates that expense the assets’ cost (or valuation) to their

estimated residual values over their useful life.

The useful life of each class of asset is as follows:

Buildings

– Shell 10 - 50 years

– Services 10 - 25 years

– Fit-out 10 - 15 years

Leasehold improvements 2 - 15 years,

based on lease renewal dates

Equipment 3 - 30 years

Motor vehicles 5 years

Furniture and fittings 5 years

Library collection 5 years

Hardware 3 years

Provisions

Provisions are recognised when: a present obligation (legal or

constructive) arises as a result of a past event; it is probable that an

outflow of resources embodying economic benefits will be required

to settle the obligation; and a reliable estimate can be made of the

amount of the obligation.

If the effect of the time value of money is material, provisions are

determined by discounting the expected future cash flows at a

pre-tax rate that reflects current market assessments of the time

value of money and, where appropriate, the risks specific to the

liability.

Provisions are reviewed at each balance date, and adjusted to reflect

the current best estimate. When it is no longer probable that an

outflow of resources embodying economic benefits will be required

to settle the obligation, the provision shall be reversed.

Where discounting is used, the increase in the provision due to the

passage of time is recognised as a finance cost.

Receivables

Trade receivables, student receivables and other receivables are

recorded at cost less provision made for uncollectible balances.

Reserves

WelTec and Group has an asset revaluation reserve which has been

generated by the revaluation of equipment, land and buildings, as

outlined in Property, Plant and Equipment above.


Critical judgements in applying accounting policies

Management has exercised the following critical judgements in

applying accounting policies for the year ended 31 December 2011:

Crown-owned land and buildings

Crown-owned land and buildings are included as part of WelTec

and Group’s property, plant and equipment. Although legal title has

not been transferred, the Crown has vested all the normal risks and

rewards of ownership to WelTec and Group. Restrictions on disposal

of these Crown owned land and buildings are in place, as per

section 192 of the Education Act 1989.

Distinction between revenue and capital contributions

Most Crown funding received is operational in nature and is provided

by the Crown under the authority of an expense appropriation and is

recognised as revenue. Where funding is received from the Crown

under the authority of a capital appropriation, WelTec and Group

accounts for the funding as an equity injection directly in equity.

Information about equity injections recognised in equity is disclosed

in note 22.

Changes in Accounting Policies

There have been no changes in accounting policies from the prior

financial year.

Adoption of the revised NZ IAS 24 Related Party Disclosures The revised NZ IAS 24 Related Party Disclosures (revised 2009) has

been adopted for the year ended 31 December 2011. The effect of

adopting the revised NZ IAS 24 is:

More information is required to be disclosed about

transactions between the Institute and government-related

entities; and

Commitments with related parties now require disclosure.

Standards, amendments and interpretations issued that are not yet effective and have not been early adopted

NZ IFRS 9 Financial Instruments will eventually replace NZ IAS

39 Financial Instruments: Recognition and Measurement.

NZ IAS 39 is being replaced in three phases:

1. Classification and Measurement

2. Impairment Methodology

3. Hedge Accounting

Phase 1 has been completed and has been published in the

new financial standard NZ IFRS 9. NZ IFRS 9 uses a single

approach to determine whether a financial asset is measured

at amortised cost or fair value, replacing the many different

rules in NZ IAS 39. The new approach is based on how

an entity manages its financial assets and the contractual

cash flow characteristics of the financial asset. The financial

liability requirements are the same as those in NZ IAS 39,

except for when an entity elects to designate a financial liability

at fair value through the profit or loss. The new Standard is

required to be adopted for the year ended 30 June 2014.

WelTec has not yet assessed the effect of the new standard

and expects it will not be adopted early.

FRS-44 New Zealand Additional Disclosures and Amendments

to NZ IFRS to harmonise with IFRS and Australian Accounting

Standards (Harmonisation Amendments) – These were issued

in May 2011 with the purpose of harmonising Australia and

New Zealand’s accounting standards with source IFRS

and to eliminate many of the differences between the

accounting standards in each jurisdiction. The amendments

must first be adopted for the year ended 31 December

2012. WelTec has yet to assess the effects of FRS-44 and

the Harmonisation Amendments.

As the External Reporting Board is consulting on a new accounting

standards framework for public benefit entities, it is expected that all

new NZ IFRS and amendments to existing NZ IFRS with a mandatory

effective date for annual reporting periods commencing on or after

1 January 2012 will not be applicable to public benefit entities. This

means that the financial reporting requirements for public benefit

entities are expected to be effectively frozen in the short term.

Accordingly, no disclosure has been made about new or amended

NZ IFRS that exclude public benefits entities from their scope.


NOTES TO THE FINANCIAL STATEMENTS

2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

2 GOVERNMENT GRANTS

Student Achievement Component 26,306 25,486 19,077 26,306 25,486 19,077

Adult & Community Education 222 222 412 222 222 412

Youth Guarantee 1,017 893 544 1,017 893 544

Trades Academy 789 1,000 - 789 1,000 -

Equity funding 141 141 218 141 141 218

Other funding 513 353 10,200 167 353 10,200

28,988 28,095 30,451 28,642 28,095 30,451

3 TERTIARY FEES

Domestic students 10,704 10,946 9,491 10,704 10,946 9,491

International students 3,775 4,430 3,963 3,775 4,430 3,963

Other fees 1,913 1,634 1,707 1,913 1,634 1,707

16,392 17,010 15,161 16,392 17,010 15,161

4 OTHER TEACHING

Contract students 3,290 2,900 3,131 3,290 2,900 3,131

Contract income 836 670 574 454 670 574

4,126 3,570 3,705 3,744 3,570 3,705

5 OTHER INCOME

Trading income 974 1,736 1,454 999 736 1,454

Other income 1,261 23 1,681 1,091 23 1,681

Profit on disposal of assets - - 155 - - 155

Finance income 845 430 738 845 430 738

3,080 2,189 4,028 2,935 1,189 4,028

6 PERSONNEL

Key Management Compensation:

Short term employee benefits 1,529 1,374 1,372 1,483 1,374 1,372

Council fees 141 121 113 141 121 113

Staff Compensation:

Short term employee benefits 27,243 26,108 25,996 26,850 25,882 25,996

Defined contribution plan employer contributions 281 - 224 281 - 224

Associated Personnel Expenses 688 738 585 686 737 585

29,882 28,341 28,290 29,441 28,114 28,290

7 ADMINISTRATION

Administrative expenditure 6,327 6,177 7,675 5,904 5,746 7,675

Non personnel research expense 74 106 43 74 106 43

Bad debts expense 98 100 72 98 100 72

Doubtful debts expense 454 - 52 454 - 52

Remuneration of external auditors 87 90 81 87 90 81

7,040 6,473 7,923 6,617 6,042 7,923

GROUP PARENT



2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

8 INFRASTRUCTURE

Information & computer technology 971 912 998 955 912 998

Insurance 334 338 312 334 336 312

Loss on disposal of assets 1 - - 1 - -

Operating leases 1,616 1,606 1,602 1,605 1,586 1,602

Occupancy 2,187 2,173 1,992 2,168 2,173 1,992

5,109 5,029 4,904 5,063 5,007 4,904

9 INTEREST, DEPRECIATION & AMORTISATION

Interest - - - - - -

Depreciation 4,741 5,527 4,954 4,741 5,527 4,954

Amortisation 507 307 450 507 307 450

5,248 5,834 5,404 5,248 5,834 5,404

10 NON OPERATING ITEMS

Restructuring - (150) (581) - (150) (581)

Gain on revaluation 262 - 186 262 - 186

Lease fitout reinstatement write back 985 985 - 985 985 -

Campus development - (504) - - (504) -

1,247 331 (395) 1,247 331 (395)

11 TRADE AND OTHER RECEIVABLES

Trade receivables 2,132 410 1,082 1,741 410 1,082

Student receivables 5,744 5,649 5,913 5,744 5,649 5,913

Related party receivables (note 33) 8 470 201 502 270 201

Provision for doubtful debt:

Opening balance (215) (215) (163) (215) (215) (163)

Bad debts written off against provision during the year - - - - - -

Additional provision made during the year (454) - (52) (454) - (52)

Closing balance (669) (215) (215) (669) (215) (215)

7,215 6,314 6,981 7,318 6,114 6,981

Not past due 4,827 5,495 4,827 5,495

Past due 1 – 30 days 6 4 6 4

Past due 31 – 60 days 302 199 302 199

Past due 61 – 90 days 30 6 30 6

Past due over 90 days 579 209 579 209

5,744 5,913 5,744 5,913

Student fees are due before a course commences or upon enrolment if the course has already begun. Student fee receivables are non-interest bearing

and are generally paid in full by course commencement date. Therefore, their carrying value approximates their fair value.

Other receivables are non-interest bearing and are generally settled on 30-day terms. Therefore the carrying value of other receivables approximates

their fair value.

The ageing profile of student receivables

GROUP PARENT



2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

12 INVENTORY

Work in progress - at cost 290 0 0 290 0 0

Finished goods - at cost 16 5 32 16 5 32

306 5 32 306 5 32

13 INVESTMENT IN ASSOCIATE

MotorTrain Limited - - - - - -

Le Cordon Bleu New Zealand Institute Limited Partnership 2,700 2,442 3,012 - - -

2,700 2,442 3,012 - - -

Balance at 1 January 3,012 3,012 - - - -

New investments during the year - - 3,150 - - -

Share of total comprehensive income (312) (570) (138) - - -

Balance at 31 December 2,700 2,442 3,012 - - -

Movements in the carrying amount of investments in associates

2011 Actual $000

2011 Budget $000

2010 Actual $000

Assets 3,047 2,917 3,242

Liabilities (347) (388) (230)

Revenues 120 89 62

Profit/(Loss) (312) (570) (138)

WelTec’s interest 43.15% 43.15% 43.15%

Share of associates contingent liabilities - - -

Share of associates commitments 1,921 1,895 2,589

Summarised financial information of WelTec Connect Limited presented on a net basis

MotorTrain Limited is a shell company in which WelTec

holds a 25% interest. No transactions were incurred

during the year.

WelTec Connect Limited holds the Group’s investment in

Le Cordon Bleu New Zealand Institute (LCBNZI), being a

43.15% investment in the Le Cordon Bleu New Zealand

Institute Limited Partnership and a 33.3% shareholding in

LCB Management NZ Limited, the General Partner of the

Limited Partnership.

WelTec and LCBNZI are jointly developing premises in

the Regent Centre, lower Cuba Street in Wellington City.

WelTec’s School of Hospitality and the LCBNZI Cuisine

School will co-locate in this facility. Academic delivery will

commence in 2012.

2011 Actual $000

2011 Budget $000

2010 Actual $000

Assets 100 16 -

Liabilities (100) (18) -

Income 363 513 -

Expenses (363) (515) -

Profit/(Loss) - (2) -

Share of joint venture’s contingent liabilities - - -

Share of joint venture’s commitments - - -

14 INVESTMENT IN JOINTLY CONTROLLED ENTITY

WelTec and Universal College of Learning (UCOL) have a

50% interest in a joint venture, Cybus, which undertakes

academic and support services on contract to the

Le Cordon Bleu New Zealand Institue Limited Partnership.

The following amounts represent the Group’s share of the

assets, liabilities, income and expenses of the joint venture:

All receivables greater than 30 days in age are considered to be past due.

A provision has been made for estimated irrecoverable amounts based on the status of individual receivable balances as at 31 December 2011.

Bad debts are written off when identified. GROUP PARENT

GROUP

GROUP


Current 2011 Actual $000

2011 Budget $000

2010 Actual $000

Loans to subsidiary - WelTec Connect Limited (refer note 33)

3,150 - -

Non current

Investment in subsidiary - WelTec Connect Limited - - -

Loans to subsidiary - WelTec Connect Limited - 3,150 3,150

3,150 3,150 3,150

15 OTHER FINANCIAL ASSETS

WelTec Connect Limited is 100% owned by WelTec

and provides research and development services,

consultancy, contract research and workplace

learning delivery.

Loans to related parties are unsecured, non-interest

bearing, and are repayable on demand. On 24 April

2012 the Council agreed to convert the $3.15m loan

to WelTec Connect Limited to capital.

As a consequence the loan has been re-classified as

a current asset for these accounts.


2011 Actual $000 Land & Buildings

Leasehold Improvement Equipment Hardware Furniture

& FittingsLibrary

CollectionAssets under Construction Total

Gross Carrying Amount

Balance as at 1 January 49,894 3,282 5,073 7,426 2,012 1,526 482 69,695

Additions 369 4 425 1,503 105 198 1,982 4,586

Disposals - - (1) (23) - - - (24)

Reclassifications - - 87 437 - - (482) 42

Net revaluation increments/ decrements 254 - - - - - - 254

Balance as at 31 December 50,517 3,286 5,584 9,343 2,117 1,724 1,982 74,553

Accumulated Depreciation

Balance as at 1 January - 2,735 1,173 4,722 1,511 978 - 11,119

Depreciation Expense 1,424 539 787 1,581 199 211 - 4,741

Disposals - - - (22) - - - (22)

Reclassifications - - - - - - - -

Net revaluation increments/ decrements (1,424) - - - - - - (1,424)

Balance as at 31 December - 3,274 1,960 6,281 1,710 1,189 - 14,414

Net Book Value 50,517 12 3,624 3,062 407 535 1,982 60,139

16 PROPERTY, PLANT AND EQUIPMENT FOR THE GROUP AND PARENT

PARENT




& FittingsLibrary




Additions 74 31 249 2,230 55 192 482 3,313

Disposals - - (8) (784) - - - (792)

Reclassifications - - 7 249 - - (256) -

Net revaluation increments/ decrements 124 - (2,399) - - - - (2,275)

Balance as at 31 December 49,894 3,282 5,073 7,426 2,012 1,526 482 69,695




Disposals - - (6) (620) - - - (626)


Net revaluation increments/ decrements (1,414) - (2,425) - - - - (3,839)

Balance as at 31 December - 2,735 1,173 4,722 1,511 978 - 11,119

Net Book Value 49,894 547 3,900 2,705 500 548 482 58,576


Land and buildings carried at fair value

An independent valuation of the land and buildings was performed by Darroch Limited, registered independent valuers as at 31 December 2011. Land

fair value is determined by reference to an open market basis, being the amount for which the assets could be exchanged between a knowledgeable

willing buyer and seller in an arm’s length transaction.

Specialist buildings are valued at fair value using depreciation replacement cost methodology. This methodology is an acceptable estimate of fair value

due to the lack of market-based evidence for education delivery purposes.

Restrictions on title

Under the Education Act 1989, WelTec and Group is required to obtain the consent from the Ministry of Education to dispose or sell of property where the

value of the property exceeds an amount determined by the Minister. There are also various restrictions in the form of historic designations, reserve, and

endowment encumbrances attached to the land. WelTec and Group does not consider it practical to disclose in detail the value of land subject to these

restrictions.



& FittingsLibrary




Additions 369 4 425 1,503 105 198 1,982 4,586

Disposals - - (1) (23) - - - (24)

Reclassifications - - 87 437 - - (482) 42

Net revaluation increments/ decrements 254 - - - - - - 254

Balance as at 31 December 50,517 3,286 5,584 9,343 2,117 1,724 1,982 74,553




Disposals - - - (22) - - - (22)


Net revaluation increments/ decrements (1,424) - - - - - - (1,424)

Balance as at 31 December - 3,274 1,960 6,281 1,710 1,189 - 14,414

Net Book Value 50,517 12 3,624 3,062 407 535 1,982 60,139



GROUP $000 Software Intellectual Property

Assets under construction Total Software Intellectual

PropertyAssets under Construction Total


Balance as at 1 January 1,580 1,100 982 3,662 1,580 973 127 2,680

Additions 14 301 146 461 - - 982 982

Disposals - - - - - - - -

Reclassifications 514 426 (982) (42) - 127 (127) -

Net revaluation increments/ - - - - - - - -

decrements - - - - - - - -

Balance as at 31 December 2,108 1,827 146 4,081 1,580 1,100 982 3,662


Balance as at 1 January 1,523 934 - 2,457 1,430 577 - 2,007

Amortisation Expense 230 277 - 507 93 357 - 450

Disposals - - - - - - - -



decrements - - - - - - - -

Balance as at 31 December 1,753 1,211 - 2,964 1,523 934 - 2,457

Net Book Value 355 616 146 1,117 57 166 982 1,205

17 INTANGIBLE ASSETS2011 2010

PARENT $000 Software Intellectual Property

Assets under construction Total Software Intellectual

PropertyAssets under Construction Total


Balance as at 1 January 1,580 1,100 982 3,662 1,580 973 127 2,680

Additions 14 301 135 450 - - 982 982

Disposals - - - - - - - -

Reclassifications 514 426 (982) (42) - 127 (127) -


decrements - - - - - - - -

Balance as at 31 December 2,108 1,827 135 4,070 1,580 1,100 982 3,662


Balance as at 1 January 1,523 934 - 2,457 1,430 577 - 2,007

Amortisation Expense 230 277 - 507 93 357 - 450

Disposals - - - - - - - -



decrements - - - - - - - -

Balance as at 31 December 1,753 1,211 - 2,964 1,523 934 - 2,457

Net Book Value 355 616 135 1,106 57 166 982 1,205

2011 2010

There are no restrictions over the title of WelTec or Group’s intangible assets, nor are any intangible assets pledged as security for liabilities.



2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

18 TRADE AND OTHER PAYABLES

Trade payables 4,242 2,536 4,024 4,229 2,536 4,024

Goods and services tax (GST) payable 1,072 1,386 1,386 1,055 1,386 1,386

5,314 3,922 5,410 5,284 3,922 5,410

Trade payables are non-interest bearing and are normally settled on 30-day terms, therefore the carrying value of payables approximates their fair

value.

19 INCOME IN ADVANCE

Student income in advance 5,565 4,962 6,179 5,565 4,962 6,179

Other income in advance 518 99 119 518 99 119

6,083 5,061 6,298 6,083 5,061 6,298

A provision is recognised for post employment benefits payable to employees. Employees are entitled to annual leave pay, long service leave and

retirement leave pay. Annual leave and sick leave entitlements expected to be settled within 12 months of the balance date are measured at the

current rates of pay and classified as current liabilities.

Entitlements related to long service leave and retirement leave have been calculated at the present value of future cash flows determined on an

actuarial basis and classified as non-current liabilities.

20 EMPLOYEE BENEFITS

Accrued employee payments 512 177 725 508 177 725

Annual and discretionary leave 2,101 1,840 1,840 2,079 1,840 1,840

Sick leave 229 202 202 229 202 202

2,842 2,219 2,767 2,816 2,219 2,767

21 NON CURRENT PROVISION

Employee benefits

Long Service leave 129 97 97 129 97 97

Retirement leave 107 87 87 107 87 87

236 184 184 236 184 184

Leased premises fitout reinstatement:

Opening balance 985 985 985 985 985 985

Expensed during the period (985) (985) - (985) (985) -

Leased premises fitout reinstatement closing balance - - 985 - - 985

236 184 1,169 236 184 1,169

Lease make-good provision

During 2011 WelTec renewed a lease which previously had a make-good clause within it (which required any damage caused to the premises to

be remedied and for WelTec to return the premises to their original configuration). During negotiations the landlord agreed to remove the make-

good clause from the new lease agreement, thereby removing the need to maintain this provision. Information about WelTec and Group leasing

arrangements are disclosed in note 29.

GROUP PARENT



2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

22 CROWN EQUITY

Opening balance 38,932 38,932 38,832 38,932 38,932 38,832

Equity Injection 400 - 100 400 - 100

Closing balance 39,332 38,932 38,932 39,332 38,932 38,932

Crown Equity represents the total investment the Crown has in WelTec. It is comprised of two components, Notional Equity - the carrying value of Crown-

owned land and buildings at the date the Crown vested all the normal risks and rewards of ownership to WelTec, and Received Equity - actual cash

payments received.

In 2011 WelTec received an equity injection of $400,000 as a contribution from the Crown for the establishment of our Trades Academy. In 2010 WelTec

received $100,000 in recognition of the investment that had been made in our document management solution and video conference capabilities.

Capital Management

WelTec and Group’s capital is its equity, which comprises its Crown equity noted above, Retained Earnings (note 23) and Reserves (note 24). Equity is

represented by net assets.

WelTec is subject to the financial management and accountability provisions of the Education Act 1989, which includes restrictions in relation to:

disposing of assets or interests in assets, ability to mortgage or otherwise charge assets or interests in assets, granting leases of land or buildings or

parts of buildings, and borrowing.

WelTec manages its revenues, expenses, assets, liabilities and general financial dealings prudently and in a manner that promotes the current and future

interests of the community. WelTec’s equity is largely managed as a by-product of managing revenues, expenses, assets, liabilities and general financial

dealings.

The objective of managing WelTec’s equity is to ensure that it effectively and efficiently achieves the goals and objectives for which it has been

established, while remaining a going concern.

23 RETAINED EARNINGS

Opening balance 6,882 6,703 3,816 7,020 6,841 3,816

Profit 2,765 1,455 3,066 3,192 1,825 3,204

Balance at end of financial year 9,647 8,158 6,882 10,212 8,666 7,020

24 RESERVES

Opening balance 22,828 21,451 21,451 22,828 21,451 21,451

Revaluation increase 1,417 - 1,377 1,417 - 1,377

Balance at end of financial year 24,245 21,451 22,828 24,245 21,451 22,828

These reserves have been generated by the revaluation of land and buildings undertaken by Darroch Limited on an annual basis, and the revaluation of

equipment on a 3 yearly basis undertaken by Ewan Forbes, registered Plant and Machinery Valuer (see note 16).

GROUP PARENT


25 NOTES TO THE CASH FLOW STATEMENT(a) Reconciliation of cash and cash equivalents

For the purposes of the cash flow statement, cash and cash equivalents includes cash on hand and in banks and term investments in money market

instruments, net of outstanding bank overdrafts. The carrying value of cash at bank, call deposits and term deposits approximates their fair value.

Cash and cash equivalents at the end of the financial year as shown in the cash flow statement is reconciled to the related items in the Balance Sheet as

follows:


2011 Actual $000

2011 Budget $000

2010 Actual $000

2011 Actual $000

2011 Budget $000

2010 Actual $000

Cash and cash equivalents:

Operating Funds 722 1,165 754 689 1,165 3,343

Designated Funds:

Campus Development 15,492 6,300 12,589 15,492 6,300 10,000

Fit-out Reinstatement - - 1,125 - - 1,125

16,214 7,465 14,468 16,181 7,465 14,468

Profit for the period 2,765 1,455 3,066 3,192 1,825 3,204

Add/(less) non-cash items:

Depreciation and amortisation of non current assets 5,249 5,835 5,404 5,249 5,835 5,404

Doubtful debts expense 454 - 52 454 - 52

Gain on sale or disposal of non current assets 1 1,075 (155) 1 1,075 (155)

Gain on revaluation of non current assets (262) - (186) (262) - (186)

Gain on provision write-back (985) - - (985) - -

Share of associate loss 312 570 138 - - -

Add/(less) movements in working capital items:

(Increase)/decrease in receivables (662) (538) (2,270) (792) (538) (2,270)

(Increase)/decrease in inventories (274) 26 146 (274) 26 146

(Increase)/decrease in prepayments 4 16 (5) 4 16 (5)

Increase/(decrease) in payables (711) (1,020) 1,630 (660) (1,020) 1,630

Increase/(decrease) in provisions 158 (548) 721 101 (548) 721

Increase/(decrease) in other current liabilities (192) (571) 960 (215) (371) 960

Net cash from operating activities 5,857 6,300 9,501 5,813 6,300 9,501

(b) Reconciliation of profit for the period to net cash flows from operating activities

26 EXPLANATION OF MAJOR VARIANCES AGAINST BUDGETExplanations for major variances against the Council approved budget are as follows:

Income statement

WelTec has delivered an Operating Profit return on Operating Income of 3.5% in 2011 which is in line with the budgeted 3.3%. This was a commendable

effort given the extra-ordinary financial pressures we were asked to operate under during the year. WelTec answered the Government’s call to provide

additional trades training during 2011 which resulted in additional Government Grants funding being received. However to earn this income WelTec was

required by the Tertiary Education Commission to deliver over 103% of Investment Plan funding. WelTec achieved this through delivering a higher number

of Trimester 2 and 3 programmes, which in turn required additional staff and resources to be incurred - the net effect of which had a negative impact on

the final result.

GROUP PARENT


NOTES TO THE FINANCIAL STATEMENTSTuition Funding income received during 2011 was $0.6m unfavourable to budget. This reflected lower international student numbers being achieved for

the year than budgeted, with the final EFTS number similar to that achieved in 2010. WelTec undertook an external review of its international operation

and has implemented a number of recommendations to improve our ability to grow this revenue stream in future years.

Other Teaching Income finished 2011 with a favourable variance to budget of $0.2m (parent) and $0.6m (Group). The parent result reflects higher than

budgeted activity with ITOs, with a significant amount of unplanned delivery occurring within plumbing and hospitality programme disciplines.

The Group result reflects the nature of services provided by WelTec Connect, with more contract based delivery as opposed to simple trading sales

activity.

Other Income generated a favourable variance of $1.7m (parent) and $0.8m (Group) to budget. Interest income contributed $0.4m of this favourable

variance, with higher cash holdings being maintained throughout the year due to campus development activities not progressing as planned. The

remainder of the variance was achieved across a number of business units and in the main reflected one-off business activity.

Cost of Services at $50.8m for the Group was an unfavourable variance to budget of $1.6m. The key expense category that generated this variance

was Personnel, with a higher number of academic staffing required to meet Trimester 2 and 3 programme delivery demand, as noted above.

Non Operating Items in 2011 reflects non cash revenue generated through the write-back of a lease re-instatement provision and the reversal of $262k

of a previously expensed revaluation loss associated with our Cuba Street, Petone premise. The 2011 budget provided for the write-off of prefabricated

buildings and specialist fitout and services located at Petone on the basis that new premises at Petone and Wellington would be completed within the

calendar year. Unfortunately the timing of these developments tracked behind original expectations, with this expenditure now likely to be recognised in

2012.

Balance Sheet

WelTec Group’s Current Assets have finished 2011 $10m higher than budget. This is principally due to higher cash holdings ($8.7m). Trade and other

receivables has finished the year $0.9m ahead of budget. This reflects a change in debt profile within our student debt with student loans becoming

harder to obtain. It also reflects a change in our contract terms with two key customers which has inflated the Trade Receivables balance at year end.

Inventory in 2011 reflects the development of 6 relocatable houses within Work in Progress. The actual number of houses being constructed in 2011

was substantially higher than budget, which had assumed 4 houses would be completed and sold within the year.

Current liabilities have finished 2011 below 2010 actual levels, but up compared to budget. This reflects the timing of capital expenditure, with large

development costs still being incurred when the budget had assumed these would be completed by December. Employee benefits are higher than

budget principally due to the higher staff costs that have been utilised in 2011 to deliver the higher domestic EFTS numbers.

Statement of cash flows

Cash holdings in 2011 remained higher than budget throughout the year, which meant WelTec was able to generate a favourable interest income

variance for the year. The key reason for this was the timing of campus development, with the Hospitality School development in Cuba Street,

Wellington progressing behind the original timeline, and no progress having been made on Petone development due to appeals being made against

the Resource Consent for a new building next to N Block in Cuba Street, Petone.

2011 Actual $000

2011 Budget $000

2010 Actual $000

Income

Government grants 455 355 464

ISS subsidy 93 77 82

Childcare fees 93 83 78

Other fees 1 3

642 515 627

Expenses

Employee benefits 503 452 469

Other direct costs 22 33 22

525 485 491

Trading contribution 117 30 136

27 TE WHARE AKO FINANCIAL SUMMARY

Te Whare Ako is a Business Unit within WelTec

providing early childhood education services.

WelTec holds a separate license from the Ministry

of Education for the provision of these services.

The accounts presented opposite do not reflect

occupancy costs or depreciation on buildings and

equipment used by the unit.

GROUP AND PARENT



2011 Actual $000

2011 Budget $000

2010 Actual $000

Buildings 5,804 32

Equipment 85 16

Hardware 35 188

Furniture & fittings 64 58

5,988 294

28 COMMITMENTS

GROUP AND PARENT

(a) Capital expenditure commitments (b) Lease commitments

Non cancellable operating lease commitments are

disclosed in note 29 to the financial statements.

2011 Actual $000

2011 Budget $000

2010 Actual $000

Not longer than 1 year 1,640 1,476

Between 1 and 5 years 3,412 3,530

Longer than 5 years 2,043 2,976

7,095 7,982

GROUP AND PARENT

(b) Non-cancellable operating lease payments

29 LEASES

(a) Leasing arrangements

WelTec enters into operating leases for buildings and

vehicles:

- Building premises are leased for our satellite delivery

offices in Auckland and Christchurch, and for our Wellington

Campus at Church Street. A number of premises are also

leased around the central Petone campus. The length of

terms of these leases vary from under 12 months, to 5

years, with rights to renewal on a number of contracts.

- Vehicles are also leased over 3 - 5 year terms depending

on the type of vehicle concerned.

30 CONTINGENT LIABILITIES

As disclosed in Note 13 WelTec is a partner in the Le Cordon Bleu New Zealand New Zealand Institute Limited Partnership. The Partnership has

negotiated a $3m loan facility with the Bank of New Zealand. The purpose of the loan is to complete the fit-out of the facility and provide working

capital. The Council has resolved to jointly and severally guarantee the loan with the other New Zealand based partner, Universal College of Learning.

Accordingly, WelTec has a contingent liability of $3m at balance date. (2010, $0).

31 CONTINGENT ASSETS

WelTec has a contingent asset of $378,000 at balance date (2010, $0). This asset relates to on-going negotiations with the Tertiary Education

Commission (TEC) in relation to Embedded Literacy and Numeracy delivery that was completed in 2011. WelTec has utilised information contained

within the January SDR and the advised funding rate of $785 per student to calculate this figure.

32 FINANCIAL INSTRUMENTS

32A Financial instrument categories

Accounting policies for financial instruments

have been applied to each class of financial

asset and financial liability outlined below.

The book value of each equals their fair value:

GROUP 2011 Actual

$000

GROUP 2010 Actual

$000

PARENT 2011 Actual

$000

PARENT 2010 Actual

$000

Financial Assets

Cash and cash equivalents 16,214 14,468 16,181 14,468

Trade and other receivables 7,215 6,981 7,318 7,888

Loans to related parties - - 3,150 3,150

Total financial assets 23,429 21,449 26,649 25,506

Financial liabilities

Trade & other payables 4,243 4,024 4,230 4,024

Total financial assets 4,243 4,024 4,230 4,024


NOTES TO THE FINANCIAL STATEMENTS32B Financial instrument risks

Risk management

Strategic risk management is undertaken by Council through the monitoring of regular risk reports provided by management. These reports highlight

potential areas of risk, and the steps that are being following to ensure the risks are appropriately managed.

The Finance department provides treasury management services for WelTec, co-ordinating the access to domestic and international financial markets and

management of the financial risks relating to the operations of the business.

WelTec does not enter into, or trade financial instruments for speculative purposes.

Details of significant accounting policies and methods adopted, including the criteria for recognition, and the basis of measurement applied in respect of

each class of financial asset, financial liability and equity instrument are disclosed in the Significant Accounting Policies section (refer to note 1) of these


Currency risk

WelTec has no material exposure to movements in foreign exchange rates. Income sourced from overseas is received in New Zealand dollar equivalents,

while trading supplies sourced from international providers are not a material portion of WelTec’s annual expenditure. Council Policy on foreign exchange

states that should an international purchase of $20,000 or more be required, investigation is made into forward cover. At balance date no forward

contracts or any other form of hedging exist.

Credit risk

Credit risk exposure for WelTec exists principally within cash and cash equivalents, and trade and other receivables balances.

Credit risk in respect of cash holdings is managed by spreading short term investment deposits with the major trading banks within New Zealand, while

ensuring WelTec receives the best return on the funds invested, as specified by Council Policy. Receivable balances are unsecured. They are stated at

their estimated realisable value after providing for amounts not considered recoverable.

The maximum credit exposure for each class of financial instrument is as follows:

GROUP 2011 Actual $000


PARENT 2011 Actual $000


Cash and cash equivalents 16,214 14,468 16,181 14,468

Trade and other receivables 7,215 6,981 7,318 7,888

Loans to related parties - - 3,150 3,150

Total credit risk 23,429 21,449 26,649 25,506

The credit quality of financial assets that are neither past due nor impaired can be assessed by reference to Standard and Poor’s credit ratings (if

available) or to historical information about counterparty default rates:





Counterparties with credit ratings

Cash and cash equivalents AA- rating 16,214 14,468 16,181 14,468

Counterparties without credit ratings

Trade and other receivables with no defaults in the past 7,215 6,981 7,318 7,888

Loans to related parties with no defaults in the past - - 3,150 3,150

Total credit risk 7,215 6,981 10,468 11,038


NOTES TO THE FINANCIAL STATEMENTSLiquidity risk

WelTec manages liquidity risk by maintaining adequate reserves to ensure the provision of educational services for the forseeable future. This

is completed by continuously monitoring and forecasting cash flows for the medium term. The maximisation of operational inflows and efficient

management of operational and investing outflows ensures sufficient cash reserves are maintained.

Contractual maturity analysis of financial liabilities

The table below analyses financial liabilities into relevant maturity groupings based on the remaining period at the balance date to the contractual

maturity date.

Carrying amount $000

Contractual cash flow $000

Less than 6 Months $000

6 - 12 Months $000 1 - 2 years $000

Group 2011

Trade and other payables 4,243 4,243 4,243 - -

Total 4,243 4,243 4,243 - -

Institute 2011


Total 4,230 4,230 4,230 - -

Group and Institute 2010


Total 4,024 4,024 4,024 - -

Contractual maturity analysis of financial liabilities

The table below analyses financial liabilities into relevant maturity groupings based on the remaining period at the balance date to the contractual

maturity date.

Carrying amount $000

Contractual cash flow $000

Less than 6 Months $000

6 - 12 Months $000 1 - 2 years $000

Group 2011

Cash and cash equivalents 1,714 1,714 1,714 - -

Trade and other receivables 7,215 7,215 7,215 - -

Term deposits 14,500 14,655 14,655 - -

Total 23,429 23,584 23,584 - -

Institute 2011

Cash and cash equivalents 1,681 1,681 1,681 - -


Term deposits 14,500 14,655 14,655 - -

Other financial assets 3,150 3,150 - - 3,150

Total 26,649 26,804 23,654 - 3,150

Group 2010

Cash and cash equivalents 468 468 468 - -


Term deposits 14,000 14,306 14,306 - -

Total 22,356 22,662 22,662 - -

Institute 2010

Cash and cash equivalents 468 468 468 - -


Term deposits 14,000 14,306 14,306 - -

Other financial assets 3,150 3,150 - - 3,150

Total 25,506 25,812 22,662 - 3,150


NOTES TO THE FINANCIAL STATEMENTSInterest rate risk

WelTec has exposure to interest rate risk to the extent that it has outstanding investments at fixed rates. The interest rates risk on investments is

managed through the use of short term investments, in accordance with Council policy. No significant exposure to interest rate risk exists on the

remaining financial assets and liabilities.

Sensitivity analysis

The table below illustrates the potential profit or loss and equity impact for reasonably possible market movements, with all other variables held

constant, based on financial instrument exposures at the balance date.

2011 Profit -50bps $000

2011 Profit +50bps $000

2010 Profit -50bps $000

2010 Profit +50bps $000

Financial Assets

Cash and cash equivalents (18) 18 (30) 30

Total credit risk (18) 18 (30) 30

Explanation of interest rate risk sensitivity

The interest rate sensitivity is based on a reasonable possible movement in interest rates, with all other variables held constant, measured on a basis

points (bps) movement. For example, a decrease in 50 bps is equivalent to a decrease in interest rates of 0.5%

Interest on financial instruments classified as floating rate is re-priced at intervals of less than one year. Interest on financial instruments classified as fixed

rate until maturity of the instrument.

The other financial instruments of WelTec that are not included in the above tables are non-interest bearing.

Group and Institute Interest rate risk

33 RELATED PARTY DISCLOSURES

Significant transactions with government related entities

The Government influences the roles of WelTec as well as being a major source of revenue.

WelTec has received funding and grants from the Tertiary Education Commission totalling $28.6m (2010, $30.4m) to provide education services for the

year ended 31 December 2011. WelTec also utilises land and buildings legally owned by the Crown.

Collectively, but not individually, significant transactions with government related entities

In conducting its activities, WelTec is required to pay various taxes and levies (such as GST, PAYE, ACC levies) to the Crown and entities related to the

Crown. The payment of these taxes and levies is based on the standard terms and conditions that apply to all tax and levy payers. WelTec is exempt from

paying income tax and FBT.

WelTec purchases goods and services from entities related to the Crown and it also provides services to entities related to the Crown. The purchase

and provision of goods and services to government-related entities for the year ended 31 December 2011 are small when compared to WelTec’s total

expenditure and revenue and have all been conducted on an arm’s length basis. The purchase of goods and services included the purchase of electricity

from Genesis and Meridian Energy, air travel from Air New Zealand, and postal services from New Zealand Post. The provision of services to government-

related entities mainly related to the provision of educational courses.

Transactions with key management personnel

Details of key management personnel remuneration are disclosed in note 6 to the financial statements.

Key management personnel include the Chairperson, Councillors, Chief Executive and the Executive Management Team.

During the year, the Metro Group of Institutes of Technology and Polytechnics purchased consulting services from Saunders Unsworth, a Wellington

based consulting company. The Council Chairperson Roger Sowry is a partner in this company. WelTec’s share of these costs were $47,330 (2010,

$32,695) and were supplied on normal commercial terms.



2011 Actual $000 2010 Actual $000

Council remuneration paid during the year

Roger Sowry (Chairperson) 29 19

Alan Barker (Deputy Chairperson) 26 12

Dennis Sharman 14 10

Nancy Ward 14 15

Peter Preston 14 17

Peter Steel 14 12

Suzanne Snively 14 10

Vaughan Renner 14 12

Alex Malahoff - 1

Anne Hare - 2

Cathrine Love - -

Francis Small - 1

Peggy Luke-Ngaheke - 1

Therese Keil - 1

Related party transactions with subsidiary, associate, and jointly controlled entity

During the reporting period WelTec

entered into transactions with

LCBNZI Limited Partnership, a

partnership in which WelTec holds

an equity interest through WelTec

Connect Limited (refer note 13).

These transactions occurred within

a normal supplier relationship on

terms and conditions no more or

less favourable than those which

it is reasonable to expect WelTec

would have adopted if dealing with

the partnership at arm’s length.

GROUP AND PARENT

2011 Actual $000 2010 Actual $000

Council remuneration paid during the year

WelTec Connect Limited

Unsecured loans payable to WelTec (refer note 35) 3,150 3,150

Debtor for services provided by WelTec 494 -

Associate

MotorTrain Limited

No related party transactions were entered into during the year - -

LCBNZI Limited Partnership

Services provided by WelTec 30 201

Debtor for services provided by WelTec 6 201

LCB Management Limited

No related party transactions were entered into during the year - -

Jointly Controlled Entity

Cybus

Services provided by WelTec 63 -

Debtor for services provided by WelTec 28 -

GROUP AND PARENT

34 CHANGES IN ACCOUNTING ESTIMATES

There have been no changes in accounting estimates during the period.

35 EVENTS AFTER BALANCE DATE

On 8 March 2012 WelTec was advised in writing from the Tertiary Education Commission that a wash-up payment in excess of that accrued would be

provided for Priority Trades Training. As a consequence WelTec has amended its financial results to incorporate the actual 2011 funding to be received.

WelTec continues to engage with the Tertiary Education Commission with regards to a possible wash-up payment in relation to 2011 Embedded Literacy

and Numeracy provision. A contingent asset has been calculated utilising January SDR actual student numbers, and the prescribed funding formula of

$785 per student. Please refer to note 31.

On 24 April 2012 the Council agreed to convert the on demand loan to WelTec Connect Limited to a capital injection in the form of an increase in the

issued share’s value. 752011 ANNUAL REPORT |

RESPONSIBILITIESIn the financial year ended 31 December 2011, the Council and Management of Wellington Institute of Technology

were responsible for:

The preparation of the Financial Statements, Statement of Objectives and Service Performance and the

judgements used therein.

Establishing and maintaining a system of internal control designed to provide reasonable assurance, as to

the integrity and reliability of financial reporting.

In the opinion of Council and management of Wellington Institute of Technology, the Financial Statements and

Statement of Objectives and Service Performance for the year ended 31 December 2011 fairly reflect the financial

position and operations of Wellington Institute of Technology and Group.

ROGER SOWRY

CHAIRPERSON 27 APRIL 2012

LINDA SISSONS (DR)

CHIEF EXECUTIVE 27 APRIL 2012


ACRONYMS

AOD Alcohol & Other Drugs

ACE Adult and Community Education

BE Bachelor of Engineering

BPS Basis Points

BSC Bachelor of Science

CATE Career and Technology Education

CCDHB Capital & Coast District Health Board

DAPAANZ Drug & Alcohol Practitioners’ Association Aoteroa New Zealand

DHB District Health Board

EFTS Equivalent Full-Time Student

EMT Executive Management Team

EPIS Educational Performance Indicators

FTE Full-Time Equivalent

HVDHB Hutt Valley District Health Board

IAS International Accounting Standard

IOD Institute of Directors

IRL Industrial Research Limited

IS Information Systems

ISS Income Support Services

IT Information Technology

ITO Industry Training Organisation

ITP Institutes of Technology & Polytechnics

LCBNZI Le Cordon Bleu New Zealand Institute

MBA Master of Business Administration

MITO Motor Industry Training Organisation

MoU Memorandum of Understanding

NZQA New Zealand Qualifications Authority

NZIFRS New Zealand International Financial Reporting Standards

NZTE New Zealand Trade and Enterprise

PBRF Performance-Based Research Fund

R&D Research and Development

SAC Student Achievement Component

SAEER Self Assessment, and External Evaluation and Review

SDR Single Data Return

SME Small and Medium Enterprises

STAR Secondary/Tertiary Alignment Resources

TEC Tertiary Education Commission

TES Tertiary Education Strategy

TFESC Territorial Forces Employers Support Council

UCOL Universal College of Learning

WCL WelTec Connect Limited


VALUES MISSION VISION ACCOUNTABILITY INTEGRITY TERMS PARTNERSHIP TEAM WORK CUSTOMER FOCUSSUSTAINABILITY INSTITUTION BUSINESS INDUSTRY

BUDGETS DELIVER BETTER VALUE EDUCATION WELTEC PROACTIVE RESPONDING CHALLENGING ENVIRONMENT

CONTINUED DELIVER QUALITY TERTIARY EDUCATION STUDENTS SUPPORTING EMPLOYERS CHARACTERISED

THEMES CONSOLIDATION COLLABORATION HIGHLIGHTED REPORT SOLID FINANCIAL PERFORMANCE COUNCIL

PLEASED REPORT FINANCIAL POSITION INSTITUTION FORWARD CONTROL MANAGEMENT RIGOROUS FINANCIAL OVERSIGHT COUNCIL WELTEC OPERATING PROFIT BUDGET

GOOD RESULT ECONOMY REVENUE CONTRIBUTOR WELLINGTON ECONOMY EMPLOYER PARTICULAR FOCUS

RISK MANAGEMENT COMPRISING RESTRUCTURED SUB-COMMITTEE STRUCTURE REFERENCE IMPORTANT

FORWARD VENTURES INSTITUTE CONNECT COMMERCIAL OPERATIONS VEHICLES STRENGTHENING DIVERSIFYING

REVENUE STREAM FUTURE EXCEEDED BUDGETED RETURN SHOWED DISCIPLINES SUSTAINABILITY BUSINESS CASE INCOME EQUIVALENT FULL TIME STUDENT INCREASED RATIOS CONTINUED PERFORM WELL WELTEC ENDED

HEALTHY WORKING CAPITAL OPERATING CASHFLOWSTERTIARY EDUCATION COMMISSION IMPOSED FUNDING

DISTORT SUPPLY DEMAND TRAINING ACTIVE MANAGEMENT EFTS REQUIRED FEWER EFTS YEARS

PROGRAMMES ACROSS SUMMER TRIMESTER ALLOCATION THRESHOLD, RECEIVE ENTITLEMENT CONTRACT INCOME

INDUSTRY TRAINING ORGANISATIONS CONTINUED EXCEEDED WELTEC ANTICIPATES INITIATIVE COMPANY MANAGE DELIVERY DISTANCE LEARNING AUTOMOTIVE

ENGINEERING

Private Bag 39803 Wellington Mail Centre Lower Hutt 5045, New ZealandFreephone: 0800 935 832 Telephone: +64 4 9202 400 Facsimile: +64 4 9202 401 www.weltec.ac.nz

WELTEC CONTINUED RESPONSIVE FAST-CHANGING TERTIARY EDUCATION

SECTOR CONSOLIDATING

WelTec 2011 Annual Report

Documents

Transcript of WelTec 2011 Annual Report