singapore totalisator board annual report 2011

Transcription

SINGAPORE TOTALISATOR BOARD
ANNUAL REPORT
2011
Singapore Totalisator Board Annual Report 2011
S. 71 of 2011
Presented to Parliament pursuant to Statute.
Ordered by Parliament to lie upon the Table:
27 September 2011
The Singapore Public Service: Integrity • Service • Excellence
MISSION STATEMENT
To oversee the efficient and effective operation of the Singapore Turf Club and Singapore Pools
(Private) Limited, and ensure that horse racing and all forms of betting and gaming operated by the
two entities are conducted with honesty and integrity; and to donate funds for activities that will
make for a stronger nation and a better people.
BACKGROUND AND OBJECTIVES
The Singapore Totalisator Board (the "Board") was established on 1 January 1988 under the
Singapore Totalisator Board Act (Chapter 305A). The Board provides a legal avenue for betting
and gaming, which would otherwise be channelled to illegal bookmakers. It holds the right to
operate horse racing and totalisators, lotteries (4D, Toto, Singapore Sweep) and sports betting
(football and Formula One motor racing). The horse racing and totalisator operations are
conducted through its proprietary club, the Singapore Turf Club while 4D, Toto, Singapore Sweep
and sports betting are conducted through its wholly-owned subsidiary, Singapore Pools (Private)
Limited.
The Board channels the surplus funds generated from its gaming and betting operations to worthy
activities in the areas of arts & culture, charity (social service), community development, education,
health and sports.
Page 1
CORPORATE GOVERNANCE REPORT
Board Members (as at 30 Jun 2011)
The Board is committed to ensure that the highest standards of corporate governance are practised
throughout the Board and its subsidiaries ("the Group").
The Chairman and Board members are appointed by the Minister for Finance and they are drawn
from both the public and private sectors.
The Board met six times during the financial year. Apart from its statutory responsibilities, the
Board sets the strategic directions and policies relating to the Board's donations and ensures that
the Board's donations are channelled to worthy causes. The Board also oversees strategic matters
concerning the Singapore Turf Club's and Singapore Pools (Private) Limited's operations.
Chairman
Members
Mr Bobby Chin Yoke Choong
- Mr Cheah Kim Teck
Ms Chew Gek IChim
Mr Kon Yin Tong
Mr Patrick Lee Kwok Kie
Mr Ng Wai Choong
Alternate: Mr Kevin Shum
Dr Mary Ann Tsao
Ms Yong Ying-I
Mr Sin Boon Ann (up to 31 Dec 2010)
BG Ravinder Singh (up to 31 Dec 2010)
Niam Chiang Meng (up to 31 Mar 2011)
- MG(NS) Chan Chun Sing (from 1 Jan to 24 Mar 2011)
Mr Michael Palmer (from 1 Jan 2011)
BG Gary Ang Aik Hwang (from 1 May 2011)
Chan Heng Kee (from 1 May 2011)
Page 2
Audit Committee Members (as at 30 Jun 2011)
The Audit Committee is chaired by a non-executive Board Member and includes representatives
from the Singapore Turf Club and Singapore Pools (Private) Limited. It reviews the adequacy of
the Group's internal financial controls, operational and compliance controls, and risk management
policies and systems (collectively "internal controls") established by the Management. It also
reviews with external auditors all statutory financial reports before submission to the Board. It met
three times during the financial year.
Chairman
Members
- Mr Kon Yin Tong
Mr Lim Joo Boon
Mr Poh Eng Seng
BG Ravinder Singh (up to 31 Dec 2010)
- Mr Kwah Thiam Hock (up to 31 Mar 2011)
MG(NS) Chan Chun Sing (from 1 Jan to 24 Mar 2011)
- Mr Gn Hiang Meng (from 1 Apr 2011)
BG Gary Ang Aik Hwang (from 1 May 2011)
Investment Committee Members (as at 30 Jun 2011)
The Investment Committee sets and reviews policies on the investment of the Board's surplus
funds. It also reviews the investment returns, performance of fund managers as well as approves
the appointment/termination of fund managers, custodians, investment consultants and related
service providers. It met four times during the financial year.
Chairman
- Mr Bobby Chin Yoke Choong
Members
Mrs Chin Ean Wah
Ms Chew Gek Khirn
Mr Ng Wai Choong
- Mr Sin Boon Ann (up to 31 Dec 2010)
Mr Nels R Friets (from 1 Jul 2010)
Mr Michael Palmer (from 1 Jan 2011)
Page 3
Internal Audit and Internal Controls
The Group's Internal Audit is an independent function that reports directly to the Audit Committee
of the Board. The professional competence of our internal auditors is maintained through
professional training programmes. The Group's Internal Audit works closely with the external
auditors and meets regularly with them to co-ordinate audit efforts. Significant non-compliances
with established practices and procedures and regulations, as well as internal control weaknesses
noted during the audit, together with the recommendations, are reported to the Audit Committees,
which ensures that high-risk outstanding issues are dealt with in a timely manner.
The Group's control framework includes the segregation of duties, periodic reconciliation of
financial information, compliance with internal financial policies, financial regulations or
government instruction manuals, clearly defined responsibility and financial authority limits.
Other measures to address the risks of fraud include the documentation of key work procedures
and policies and audit checks to ensure compliance with these procedures and policies.
The Board believes that the system of internal controls in place is adequate for the current
operations of the Group.
Page 4
MEMBERS OF THE GROUP - SINGAPORE POOLS (PRIVATE) LIMITED
Directors (as at 30 Jun 2011)
Chairman
- Mr Bernard Chen Tien Lap
Directors - Mr Lim Joo Boon
Mr Tan Guong Ching
Mr Sat Pal Khattar
Mr Poh Eng Seng
Mr Chia Ngiang Hong
Mr Tan Soo Nan
Audit Committee Members (as at 30 Jun 2011)
Chairman
- Mr Lim Joo Boon
Members
- Mr Poh Eng Seng
- Mr Chia Ngiang Hong
Page 5
MEMBERS OF THE GROUP - SINGAPORE TURF CLUB
Management Committee Members (as at 30 Jun 2011)
Chairman
- Mr Tan Guong Ching
Honorary Secretary - Mr Cheah Kim Teck
Honorary Treasurer - Prof Leong Siew Meng
Members
- Mr Harry Elias
- Mr Lim Jo° Boon
Mr Jerry Sung Ye-Ven
Mr Gn Hiang Meng
Mr Jimmy Lau
- Mr Sitoh Yih Pin
Mr Tan Pee Teck
Mr Tony Tan Keng Jo°
- Mr Chou Sean Yu
Mr Kwah Thiam Hock (up to 31 Mar 2011)
Mr Jeffery Chan Cheow Tong (from 1 Apr 2011)
Audit Sub-Committee Members (as at 30 Jun 2011)
Chairman
- Mr Kwah Thiam Hock (up to 31 Mar 2011)
Mr Gn Hiang Meng (from 1 Apr 2011)
Members
- Mr Harry Elias
- Prof Leong Siew Meng
Mr Gn Hiang Meng (up to 31 Mar 2011)
Mr Jeffery Chan Cheow Tong (from 1 Apr 2011)
Page 6
•
•••••••••0•
Organisation Structure
as at 30 Jun 2011
Singapore Totalisator Board
Chairman & Board Members
Singapore Pools
(Private) Limited
Singapore
Turf Club
Audit Committee
Investment Committee
Chief Executive
Corporate Services
Division
Grant Management
Division
Special Duties
Division
Internal Audit
Department
Page 7
Principal Officers
as at 30 Jun 2011
Chief Executive
- Mr Tan Soo Nan
Director (Special Duties)- Mr Fong Heng Boo
Director (Corporate Services) - Miss Loretta Boon Mei Lin
Director (Grant Management) - Mrs Boon-Ngee Sebastian
Senior Manager (Internal Audit) - Ms Lim Ay Ling
Page 8
MAJOR INITIATIVES IN FY10
Discussions on redevelopment at the Kranji racecourse site were held with interested parties. The
aim is to maximise the utilisation of the land at the site, both for commercial use and community
projects.
Renovations at the grandstand building at the racecourse and improvement of the racecourse
facilities began in 2010 and are expected to be completed in 2014.
The Board's revamped corporate website was launched on 10 Oct 2010.
On 27 Dec 2010, the Singapore Totalisator Board (Amendment) Act 2008 became effective; the
Singapore Totalisator Scheme (in the form of subsidiary legislation) was repealed and the
supervision of the Singapore Totalisator Scheme devolved from the Ministry of Finance to the
Board. Effective the same day, the Board authorised the Singapore Turf Club, its appointed agent,
to operate and administer a revised Totalisator Scheme on its behalf. The new arrangement allows
the Turf Club to respond faster to market changes and demands.
•
Page 9
BOARD'S DONATIONS
The Board donates funds to worthy activities across a spectrum of sectors that will make for a
stronger nation and a better people.
In FY10, the Board's donation approvals totalled $569m, an increase of $304m over the previous
year's approvals. The following paragraphs give a summary of several significant donations
approved during the year:
$100m over three years was channelled into the Tote Board Community Healthcare Fund to expand
its current scope to support new and emerging areas of preventive, intermediate and long-term
healthcare. The fund injection will also give impetus to community efforts to provide better
integrated care in areas of needs such as home care and mental health.
$50m over five years was pledged to the Community Chest to support critical social service
programmes under its care. This contribution is on top of the Board's current support through the
Tote Board Social Service Fund. The increased funding will lift some fund-raising pressure off the
Community Chest to meet the greater demand for social services arising from Singapore's ageing
population, more complicated family issues and people with disabilities.
$8m was made available to the Ministry of Community Development, Youth and Sports to develop
infrastructure and capability to provide differentiated care in six small-group therapeutic homes
which cater specially to children with special needs, attachment disorders or challenging
behaviour.
$0.6m over three years was injected into the Yellow Ribbon Project, a community engagement
campaign to raise awareness and generate community goodwill to encourage societal acceptance of
ex-offenders back into the community.
$73m over three years was given to the Esplanade Company Limited to run community
programmes to make arts accessible to people from all walks of life, encourage social cohesion &
build a sense of national identity. Some examples of community programmes are Huayi, In:Music,
Pesta Raya, A Date with Friends, Beautiful Sunday and Baybeats.
$85m was committed to the S.League to run its next five seasons, with special focus this round on
building up S.League's capability to improve the quality of play, match experience and bring back
Singaporeans' interest in club football.
$10m to develop the Raffles Museum of Biodiversity Research, under the National University of
Singapore, into a Natural History Museum that will raise its education, research and exhibition
capabilities in engaging the public and researchers on the importance of biodiversity, conservation
and environmental issues.
Page 10
BOARD'S DONATIONS
Board's Initiatives in FY10
The Board continued to push on its on-going capability building drive for the non-profit sector.
The Social Innovation Research (SIR) Fund was well-received by the polytechnics and Institutes of
Technical Education (ITEs). Lecturers and students from six polytechnics and ITE bid for grants to
provide seed funding for research and development work for the benefit of the social service sector.
The SIR Fund Selection Committee endorsed 24 proposals and approved total grants amounting to
$1.6m. Some projects receiving SIR Fund are:
A vertical food gardening system for leafy crops and herbs based on 'rotating hydroponics'
and LED technology;
An affordable bilateral upper limb manipulator to assist in rehabilitation;
Fast response, accurate and low cost portable biosensor system for early diagnosis of Hand,
Foot and Mouth Disease infection; and
To manufacture large quantities of biodegradable foam packaging material.
The inaugural Outcome Funding grant call attracted a sizable number of proposals from a varied
spread of non-profit organisations including arts groups, educational and health institutions, and
voluntary welfare organisations. In keeping with the intensive engagement requirement of outcome
funding, the Board selected nine projects for the pilot phase and pledged a total sum of $1.6m
towards them. Plans are underway to open a second grant call in 2011 to enable more organisations
to participate in this Outcome Funding model.
Commissioned by the Board, the Asian Business Case Centre, under the auspices of the Nanyang
Technological University, produced three more case studies on managerial and organisational
issues relating to the social service sector in Singapore, bringing the total number of completed case
studies to five since the initiative started in 2009. As a complementary effort, the Board also
organised two workshops to discuss the case studies. The workshops attracted 76 participants who
found the sessions insightful and relevant to their work. The Board will press on this pathway with
the end goal of building up a library of case studies for local learning.
12 senior management staff of non-profit organizations have participated in Tote Board Overseas
Scholarship programme, including five new ones in FY10, since it started three years ago. The 12
Tote Board scholars attended senior executive management programmes in distinguished overseas
institutions like the Harvard University, Stanford University, Duke University and George Town
University.
•
Page 11
BOARD'S DONATIONS
Board's Initiatives in the Pipeline
The first in the pipeline is the Social Enterprise (SE) Hub aimed at incubating promising social
enterprises to achieve significant beneficial impact on the community. Besides financial support, the
SE Hub will offer business support services to relieve the start-ups of the day-to-day administrative
issues. A panel of seven mentors has been set up for the start-ups to tap on their wide range of
expertise and knowledge in areas such as technology, operations, brand management and
marketing.
In addition, the Board is exploring a tie-up with a reputable educational institution to develop an
executive programme for the non-profit leaders. This training programme will also incorporate case
study learning using the Board's library of cases on local social service issues. The Board will build
on its momentum to explore initiatives that will uplift the capabilities of the non-profit sector.
Page 12
Betting Duties
Betting duties were 25% of gross profit for the totalisator, 25% of collections less GST for lottery
products, and 25% of collections less prize payouts less GST for fixed odds football and Formula
One motor racing betting.
Total betting duties paid to Government amounted to $1,417 million, an increase of $23 million or
1.7% over the previous year.
Page 13
REVIEW OF FINANCIAL PERFORMANCE
SINGAPORE TURF CLUB
Year EndedYear Ended
31 March 201131 March 2010
$M
$M
Totalisator
Turnover
Dividends Paid (Net of Unclaimed Dividends) Betting Tax Paid to Government Revenue from Totalisator 1,848 2,095
(1,493) (1,703)
(94) (104)
261
288
Other Racing Related Revenue
25
23
Sundry Income 11
13
Total Revenue
297
324
Expenditure
(253)
(232)
44
92
Surplus
TABLE 1
There were 93 Singapore race days, with a total of 960 races, giving an average of ten races on each
Singapore race day. Altogether, there were 4,663 races for the year, including races from Malaysia,
Hong Kong, Australia, South Africa, Europe and other countries.
The totalisator turnover was $1,848 million, a decrease of $247 million or 11.8 % over the previous
year. The decrease was mainly due to lower bet collection.
Page 14
SINGAPORE POOLS (PRIVATE) LIMITED
Year Ended Year Ended
31 March 2011 31 March 2010
$M
$M
Lotteries and Other Products
Turnover
6,236 6,019
Prizes/Dividends Paid (Net of Unclaimed Prizes/Dividends) (4,321) (4,028)
(1,323) (1,290)
Betting Tax Paid to Government (44) (43)
Commission Paid Revenue from Lotteries and Other Products
548
658
Investment and Other Income
2
3
550
661
Expenditure
(113)
(105)
Donations
-
-
437
556
Total Revenue
Surplus
TABLE 2
The turnover was $6,236 million, an increase of $217 million or 3.6% as compared to the previous
year. The increase was mainly due to additional sales from sports betting (2010 World Cup
tournament) and higher turnover for 4D.
Page 15
SINGAPORE TOTALISATOR BOARD (GROUP)
31 March 201131 March 2010
$M
$M
Surplus of Singapore Turf Club 44
92
Surplus of Singapore Pools (Private) Limited 437
556
Net Investment Income and Other Income of Singapore Totalisator Board
322
318
Expenditure of Singapore Totalisator Board (14)
-
Donations of Singapore Totalisator Board (474)
(494)
Surplus of the Group
315
472
TABLE 3
The group's surplus decreased by $157 million from $472 million in FY09 to $315 million in FY10.
The decrease was mainly due to a decrease in Singapore Pools (Private) Limited's surplus.
Page 16
DONATIONS
The Group's committed donations are as follows:
31 March 201131 March 2010
$M
$M
Arts and Culture 95
74
Charity (Social Service) 114
61
Community Development 119
401
Education
26
23
Health
22
28
Sports
128
116
Total
504
703
TABLE 4
The donation commitments in FY10 dropped by 28% as compared to the previous year because the
drawdown in payments towards the Gardens by the Bay had slowed down considerably as the
construction nears completion. Another contributing factor arose from the change in disbursement
basis for a major charity programme. Payment is now made at the beginning rather than the end of
each quarter to facilitate the flow of funds to end-beneficiaries.
Page 17
PERFORMANCE INDICATORS
TOTALISATOR TURNOVER
LO1TER1ESAND OTHERPRODUCTS TURNOVER'
SV000
S5'000
2509,000
6,400,000
6,200,000
2,000,000
c000gra
1,599,000
5,800,000
5,689,000
1,000,000
5,400,000
500,000
5,200,090
0642707/08080909/10
1 OA 1
FY
5,000,000
ANNUAL NET SURPLUS
851)00
SUM
061370711380811)909t10
10/11
FY
06107071080810909/10
10/11
ANNUAL CONTRIBUTION TO GOVERNMENT
IBETTING DUTIES, INCOME TAX AND
CONTRIBUTION TO THE CONSOLIDATED FUND)
08/0707/98mos09/100711
Page 18
and its Subsidiaries
Financial Statements
Year ended 31 March 2011
Page 19
Singapore Totalisator Board and its Subsidiaries
Statement by the Singapore Totalisator Board
Statement by the Singapore Totalisator Board
In our opinion:
the accompanying financial statements of the Singapore Totalisator Board (the Board) and
its subsidiaries (the Group) as set out on pages FS1 to FS34 are drawn up so as to give a
true and fair view of the state of affairs of the Group and of the Board as at 31 March 2011,
the results from operations and changes in capital and reserves of the Group and the Board
and cash flows of the Group for the year ended on that date in accordance with the
provisions of the Singapore Totalisator Board Act (Cap. 305A, 1999 Revised Edition) and
Statutory Board Financial Reporting Standards; and
at the date of this statement, there are reasonable grounds to believe that the Board will be
able to pay its debts as and when they fall due.
On behalf of the Board
Bobby Chin
Chairman
Ta oo Nan
Chief Executive
23 June 2011
Page 20
Independent auditors' report
Independent auditors' report
Members of the Board
Report on the financial statements
We have audited the accompanying financial statements of Singapore Totalisator Board (the
Board) and its subsidiaries (the Group), which comprise the statements of financial position of
the Group and the Board as at 31 March 2011, the statements of comprehensive income and
statements of changes in capital and reserves of the Group and the Board and cash flow
statement of the Group for the year then ended, and a summary of significant accounting
policies and other explanatory information, as set out on pages FS1 to FS34.
Management's responsibility for the financial statements
The Board's management is responsible for the preparation and fair presentation of these
financial statements in accordance with the provisions of the Singapore Totalisator Board Act,
(Cap. 305A, 1999 Revised Edition) (the Act) and Statutory Board Financial Reporting
Standards and for such internal control as management determines is necessary to enable the
preparation of financial statements that are free from material misstatement, whether due to
fraud or error.
Auditors' responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We
conducted our audit in accordance with Singapore Standards on Auditing. Those standards
require that we comply with ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free from material
misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial statements. The procedures selected depend on the auditor's
judgement, including the assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk assessments, the auditor
considers internal control relevant to the entity's preparation and fair presentation of the
financial statements in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion on the effectiveness of the
entity's internal control. An audit also includes evaluating the appropriateness of accounting
policies used and the reasonableness of accounting estimates made by management, as well as
evaluating the overall presentation of the financial statements.
•
believe that the audit evidence we have obtained is sufficient and appropriate to provide a
We
basis for our audit opinion.
Page 21
Independent auditors report
Opinion
In our opinion, the consolidated financial statements of the Group and the statement of financial
position, statement of comprehensive income and statement of changes in capital and reserves
of the Board are properly drawn up in accordance with the provisions of the Act and Statutory
Board Financial Reporting Standards to present fairly, in all material respects, the state of affairs
of the Group and the Board as at 31 March 2011 and the results and changes in capital and
reserves of the Group and of the Board and cash flows of the Group for the year ended on that
date.
Report on other legal and regulatory requirements
In our opinion:
the accounting and other records, including records of all assets of the Board, whether
purchased, donated or otherwise required by the Act to be kept by the Board have been
properly kept in accordance with the provisions of the Act;
the accounting and other records of those subsidiaries incorporated in Singapore of which
we are the auditors have been properly kept in accordance with the Singapore Companies
Act, Chapter 50; and
during the course of our audit, nothing came to our notice that caused us to believe that the
receipt, expenditure and investment of monies and the acquisition and disposal of assets by
the Board during the fmancial year have not been in accordance with the provisions of the
Act.
4AG mi
KPMG LLP
Public Accountants and
Certified Public Accountants
Singapore
23 June 2011
Page 22
Financial statements
Statements of financial position
As at 31 March 2011
Note
Non-current assets
Property, plant and
equipment
Intangible assets
Investment in subsidiaries
Reversionary interest in
trusts
Loan to a subsidiary
Club memberships
Other investments
Current assets
Financial assets at fair value
through profit or loss
Trade and other receivables
Tax recoverable
Cash and cash equivalents
4
5
6
614,953,964
63,897,740
7
8
9
49,737,138
49,722,224
1,177,000
200
729,766,042
1,993,912,795
58,267,399
1,043,543
1,077,513,274
3,130,737,011
3,860,503,053
13
14
15
10
11
12
Total assets
Capital and reserves
Capital account
Accumulated surpluses
Non-current liabilities
Deferred tax liabilities
Deferred capital grants
Provision for restoration
costs
Current liabilities
Government grants received
in advance
Trade payables
Other payables and accruals
Provision for donations
Current tax payable
Provision for contribution
to Consolidated Fund
Total liabilities
Total capital and reserves
and liabilities
Group
2011 2010
16
17
18
19
Board
2011 2010
456,052,210
2,850
58,569,391
538,049,168
49,722,224
1,198,000
200
665,000,725
49,737,138
143,000,000
250,000
707,611,589
646,590,783
1,808,440,312
65,832,155
1,993,912,795
62,636,006
1,808,440,312
48,915,673
1,178,921,634
3,053,194,101
3,718,194,826
821,527,884
2,878,076,685
3,585,688,274
934,721,753
2,792,077,738
3,438,668,521
295,075,118
2,977,607,436
3,272,682,554
295,075,118
2,714,286,765
3,009,361,883
295,075,118
2,901,895,220
3,196,970,338
295,075,118
2,645,538,658
2,940,613,776
2,487,492
272,812,251
1,576,000
360,038,882
272,812,251
360,038,882
2,734,574
278,034,317
1,902,304
363,517,186
2,734,574
275,546,825
1,902,304
361,941,186
42,018
39,232,316
212,869,808
5,135,274
42,018
39,047,091
225,069,006
31,000
1,586,877
42,018
42,018
55,518,053
5,104,274
56,531,776
52,506,766
309,786,182
587,820,499
79,539,765
345,315,757
708,832,943
52,506,766
113,171,111
388,717,936
79,539,765
136,113,559
498,054,745
3,860,503,053
3,718,194,826
3,585,688,274
3,438,668,521
554,295,604
59,784,697
58,569,391
250,000
The accompanying notes form an integral part of these financial statements.
Page 23
Statements of comprehensive income
For the year ended 31 March 2011
Note
Group
20112010
Board
20112010
Restated
Income from betting and gaming
activities
Other operating income
Total operating income
Operating expenditure
Staff costs
Racing and related expenses
Depreciation of property, plant and
equipment
General administrative expenses
Office and property related expenses
Upkeep of property, plant and
equipment
Information technology expenses
Amortisation of intangible assets
Agency fees
Total operating expenditure
Operating surplus
Non-operating income
Investment income
Casino entry levy
(Allowance made for)/writeback of
impairment in value of club
memberships
Writeback of impairment in value of
reversionary trust funds
Amortisation of Government grants
(Loss)/gain on disposal of property,
plant and equipment
Rental income
Total non-operating surplus
20(a)
20(b)
20(c)
20(d)
4
809,780,007
36,402,184
846,182,191
945,665,355
39,421,813
985,087,168
20(e)
(42,712,135)
(36,655,196)
(36,536,435)
5
(17,170,054)
(9,215,337)
(2,118,538)
(15,997,102)
(9,292,921)
(2,139,316)
21
99,050,700
223,966,870
276,239,674
41,811,000
9
(21,000)
173,000
Total surplus
Donations
809,780,007
36,123,022
845,903,029
(111,826,551) (113,840,024) (105,421,037)
(110,525,738) (102,564,089) (110,525,738)
(128,031,065)
(38,399,681)
(50,172,575)
7
15
Restated
945,665,355
39,331,314
984,996,669
(102,014,108)
(102,564,089)
(128,031,065)
(38,128,244)
(50,172,575)
(42,712,135)
(36,271,774)
(36,536,435)
(17,170,054)
(10,240,123)
(2,118,538)
(11,283,164)
(467,459,539) (359,737,218) (473,090,538)
378,722,652
625,349,950
372,812,491
(15,997,102)
(10,494,221)
(2,139,316)
(14,322,352)
(363,051,532)
621,945,137
98,514,263
223,966,870
275,512,819
41,811,000
14,914
87,226,631
4,802,706
12,217,759
14,914
87,226,631
4,802,706
12,217,759
(492,423)
1,168,930
410,914,622
6,014,868
(489,040)
1,168,930
410,402,568
6,012,068
341,259,007
789,637,274
966,608,957
783,215,059
(474,731,567) (494,502,138) (474,351,731)
340,356,352
962,301,489
(494,420,521)
Surplus before tax and contribution
to Consolidated Fund
Income tax credit
Surplus before contribution to
Consolidated Fund
Contribution to Consolidated Fund
Surplus for the year, representing
total comprehensive income for
the year
314,905,707
921,730
472,106,819
835,791
308,863,328
467,880,968
22
19
315,827,437
(52,506,766)
472,942,610
(79,539,765)
308,863,328
(52,506,766)
467,880,968
(79,539,765)
263,320,671
393,402,845
256,356,562
388,341,203
Page 24
Statements of changes in capital and reserves
For the year ended 31 March 2011
Capital
account
Accumulated
surpluses
Total
2,320,883,920
2,615,959,038
393,402,845
393,402,845
2,714,286,765
3,009,361,883
263,320,671
263,320,671
295,075,118
2,977,607,436
3,272,682,554
295,075,118
2,257,197,455
2,552,272,573
388,341,203
388,341,203
2,645,538,658
2,940,613,776
256,356,562
256,356,562
2,901,895,220
3,196,970,338
Group
At 1 April 2009
•
295,075,118
Total comprehensive income for the year
At 31 March 2010
295,075,118
At 31 March 2011
fit
Board
At 1 April 2009
At 31 March 2010
295,075,118
At 31 March 2011
295,075,118
Page 25
Consolidated cash flow statement
Note
Operating activities
Surplus before tax and contribution to Consolidated Fund
Adjustments for:
Amortisation of government grant
Depreciation of property, plant and equipment
Amortisation of intangible assets
Loss/(gain) on disposal of property, plant and equipment
Investment income
Allowance made/(written back) for impairment in value of club
memberships
Writeback of impairment in value of reversionary trust fund
Bonds purchased
Donations
2011
2010
314,905,707
472,106,819
21
(87,226,631)
128,031,065
2,118,538
492,423
(99,050,700)
(12,217,759)
42,712,135
2,139,316
(6,014,868)
(276,239,674)
9
7
21,000
(14,914)
(173,000)
(4,802,706)
(200)
494,502,138
712,012,201
15
4
5
474,731,567
734,008,055
Changes in working capital:
Inventories
Trade receivables
Deposits, prepayments and other receivables
Trade payables
Provision for restoration costs
Other payable and accruals
Cash generated from operations
(8,519,019)
18,384,564
185,225
(14,391,760)
729,667,065
Donations paid
Income taxes paid
Contribution to Consolidated Fund paid
Staff loans granted
Cash flows from operating activities
(469,627,293) (496,482,138)
(797,198)
(1,323,088)
(79,539,765)
(32,291,424)
(6,600)
(12,600)
179,696,209
170,203,494
Investing activities
Purchase of property, plant and equipment
Purchase of financial assets at fair value through profit or loss
Payment for intangible assets
Proceeds from disposal of property, plant and equipment
Proceeds from disposal of financial assets at fair value through
profit or loss
Interest received
Dividend received
Cash flows from investing activities
(190,327,036)
(91,607,392)
(2,103,845)
42,284
12,084
2,879,336
(281,104,569)
Financing activity
Grant received
Cash flows from financing activity
Net decrease in cash and cash equivalents
Cash and cash equivalents at beginning of year
Cash and cash equivalents at end of year
468,139
(9,673,769)
(19,539,188)
(4,499,776)
(161,288)
21,706,425
700,312,744
(92,306,793)
(116,661,340)
(221,331)
6,397,475
32,017
4,050,677
73,771
(198,635,524)
75,000
75,000
12
(101,408,360)
(28,357,030)
1,178,921,634 1,207,278,664
1,077,513,274 1,178,921,634
During the year, the Group acquired property, plant and equipment with an ag gregate cost of
$193,351,868 (2010: $90,613,516) of which $2,192,562 (2010: $1,693,277) relates to accruals and
$832,270 (2010: $Nil) relates to provision for restoration costs.
Page 26
Notes to the financial statements
These notes form an integral part of the financial statements.
The financial statements were authorised for issue by the Members of the Board on 23 June
2011.
1Domicile and activities
Singapore Totalisator Board (the Board) was established on 1 January 1988 in the Republic of
Singapore under the Singapore Totalisator Board Act (Chapter 305A, 1999 Revised Edition).
The office of the Board is located at 1 Turf Club Avenue, #03-01 Singapore Racecourse,
Singapore 738078.
As a statutory board, the Board is subject to the directions of the Ministry of Finance and is
required to implement policies and policy changes as determined by the Ministry. The principal
activities of the Board are those relating to operating totalisators, lotteries and other betting and
gaming activities, conducting equine research and carrying on other activities for the
improvement of racing generally. These activities are carried out by the Singapore Totalisator
Board's two agents, the Singapore Turf Club (proprietary club of the Board) and the Singapore
Pools (Private) Limited (subsidiary of the Board).
The principal activities of the Board's subsidiaries are set out in Note 6 below.
The financial statements of the Board encompass the financial statements of the Board,
Singapore Turf Club and the agency operations managed by Singapore Pools (Private) Limited.
•
•
The consolidated financial statements relate to the Board and its subsidiaries (together referred
to as the Group).
2
Basis of preparation
2.1
Statement of compliance
The financial statements have been prepared in accordance with the provisions of the Singapore
Totalisator Board Act (Chapter 305A, 1999 Revised Edition) and the Statutory Board Financial
Reporting Standards (SB-FRS). SB-FRS includes Statutory Board Financial Reporting
Standards, Interpretations of SB-FRS and SB-FRS Guidance Notes as promulgated by the
Accountant-General.
•
2.2
Basis of measurement
The financial statements have been prepared on the historical cost basis, except as otherwise
described below.
•
2.3
Functional and presentation currency
The financial statements are presented in Singapore dollars, which is the Board's functional
currency.
Page 27
2.4Use of estimates and judgements
The preparation of the financial statements in conformity with SB-FRSs requires management
to make judgements, estimates and assumptions that affect the application of accounting
policies and the reported amounts of assets, liabilities, income and expenses. Actual results may
differ from these estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to
accounting estimates are recognised in the period in which the estimates are revised and in any
future periods affected.
Information about critical judgements in applying accounting policies that have the most
significant effect on the amounts recognised in the financial statements is included in Note 27.
2.5Changes in accounting policies
From 1 April 2010, the Group has applied SB-FRS 103 (revised 2009) Business Combinations
in accounting for business combinations. Business combinations occurring after 1 April 2010
will be accounted for using the acquisition method as at the acquisition date as described in
Note 3.1.
Previously, business combinations were accounted for under the purchase method. The cost of
an acquisition was measured at the fair value of the assets given, equity instruments issued and
liabilities incurred or assumed at the date of exchange, plus costs directly attributable to the
acquisition. The excess of the Group's interest in the net fair value of the identifiable assets,
liabilities and contingent liabilities over the cost of acquisition was credited to profit or loss in
the period of the acquisition. For business acquisitions that were achieved in stages, any
existing equity interests in the acquiree were not re-measured to their fair value. Contingent
consideration was recognised as an adjustment to the cost of acquisition only when it was
probable and can be measured reliably.
The change in accounting policy will be applied prospectively to new business combinations
occurring on or after 1 April 2010. There was no new business combination in the current
financial year.
3Significant accounting policies
The accounting policies set out below have been applied consistently to all periods presented in
these financial statements, and have been applied consistently by the Group entities, except as
explained in Note 2.5, which addresses changes in accounting policies.
3.1Basis of consolidation
Business combinations
For acquisitions on or after 1 April 2010
Business combinations are accounted for using the acquisition method as at the acquisition date,
which is the date on which control is transferred to the Group. Control is the power to govern
the financial and operating policies of an entity so as to obtain benefits from its activities. In
assessing control, the Group takes into consideration potential voting rights that are currently
exercisable.
Page 28
The consideration transferred does not include amounts related to the settlement of pre-existing
relationships. Such amounts are generally recognised in profit or loss.
Costs related to the acquisition, other than those associated with the issue of debt or equity
securities, that the Group incurs in connection with a business combination are expensed as
incurred.
Any contingent consideration payable is recognised at fair value at the acquisition date. If the
contingent consideration is classified as equity, it is not remeasured and settlement is accounted
for within equity. Otherwise, subsequent changes to the fair value of the contingent
consideration are recognised in profit or loss.
For acquisitions prior to 1 April 2010
Business combinations are accounted for under the purchase method. The cost of an acquisition
is measured at the fair value of the assets given, equity instruments issued and liabilities
incurred or assumed at the date of exchange, plus costs directly attributable to the acquisition.
The excess of the Group's interest in the net fair value of the identifiable assets, liabilities and
contingent liabilities over the cost of acquisition is credited to profit or loss in the period of the
acquisition.
Subsidiaries
Subsidiaries are entities controlled by the Group. The financial statements of subsidiaries are
included in the consolidated financial statements from the date that control commences until the
date that control ceases. The accounting policies of subsidiaries have been changed when
necessary to align them with the policies adopted by the Group.
Transactions eliminated on consolidation
Intra-group balances and transactions, and any unrealised income or expenses arising from
intra-group transactions, are eliminated in preparing the consolidated financial statements.
•
Accounting for subsidiaries
Investments in subsidiaries are stated in the Company's balance sheet at cost less accumulated
impairment Fosses.
3.2Foreign currency transactions
•
Transactions in foreign currencies are translated to the respective functional currencies of the
Group entities at exchange rates at the dates of the transactions. Monetary assets and liabilities
denominated in foreign currencies at the end of the reporting period are retranslated to the
functional currency at the exchange rate at that date. The foreign currency gain or loss on
monetary items is the difference between amortised cost in the functional currency at the
beginning of the year, adjusted for effective interest and payments during the year, and the
amortised cost in foreign currency translated at the exchange rate at the end of the year.
Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair
value are retranslated to the functional currency at the exchange rate at the date that the fair
value was determined Non-monetary items in a foreign currency that are measured in terms of
historical cost are translated using the exchange rate at the date of the transaction. Foreign
currency differences arising on retranslation are recognised in profit or loss.
Page 29
3.3Financial instruments
Non derivative financial assets
-
The Group initially recognises loans and receivables and deposits on the date that they are
originated. All other financial assets (including assets designated at fair value through profit or
loss) are recognised initially on the trade date at which the Group becomes a party to the
contractual provisions of the instrument.
The Group derecognises a financial asset when the contractual rights to the cash flows from the
asset expire, or it transfers the rights to receive the contractual cash flows on the financial asset
in a transaction in which substantially all the risks and rewards of ownership of the financial
asset are transferred. Any interest in transferred financial assets that is created or retained by
the Group is recognised as a separate asset or liability.
Financial assets and liabilities are offset and the net amount presented in the statement of
financial position when, and only when, the Group has a legal right to offset the amounts and
intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.
The Group has the following non-derivative fmancial assets: financial assets at fair value
through profit or loss and loans and receivables.
Financial assets at fair value through profit or loss
A financial asset is classified at fair value through profit or loss if it is classified as held for
trading or is designated as such upon initial recognition. Financial assets are designated at fair
value through profit or loss if the Group manages such investments and makes purchase and
sale decisions based on their fair value in accordance with the Group's documented risk
management or investment strategy. Attributable transaction costs are recognised in profit or
loss as incurred. Financial assets at fair value through profit or loss are measured at fair value,
and changes therein are recognised in profit or loss.
Loans and receivables
Loans and receivables are financial assets with fixed or determinable payments that are not
quoted in an active market. Such assets are recognised initially at fair value plus any directly
attributable transaction costs. Subsequent to initial recognition, loans and receivables are
measured at amortised cost using the effective interest method, less any impairment losses.
Loans and receivables comprise cash and cash equivalents and trade and other receivables.
Cash and cash equivalents comprise bank balances and bank deposits.
Non derivative financial liabilities
-
All financial liabilities are recognised initially on the trade date, which is the date that the Group
becomes a party to the contractual provisions of the instrument.
The Group derecognises a financial liability when its contractual obligations are discharged,
cancelled or expire.
Financial assets and liabilities are offset and the net amount presented in the statement of
financial position when, and only when, the Group has a legal right to offset the amounts and
intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.
Page 30
The Group's non-derivative financial liabilities comprise trade and other payables.
Such financial liabilities are recognised initially at fair value plus any directly attributable
transaction costs. Subsequent to initial recognition, these financial liabilities are measured at
amortised cost using the effective interest method.
3.4Property, plant and equipment
Recognition and measurement
•
•
•
Property, plant and equipment are measured at cost less accumulated depreciation and
impairment losses. The value of leasehold land includes the leasehold land situated at Kranji
which was ascribed the same value as that of the freehold land situated at Bukit Timah given up
in 1999 during a land exchange.
Cost includes expenditure that is directly attributable to the acquisition of the asset. The cost of
self-constructed assets includes the cost of materials and direct labour, any other costs directly
attributable to bringing the assets to a working condition for their intended use, the costs of
dismantling and removing the items and restoring the site on which they are located, and
capitalised borrowing costs. Purchased software that is integral to the functionality of the
related equipment is capitalised as part of that equipment.
When parts of an item of property, plant and equipment have different useful lives, they are
accounted for as separate items (major components) of property, plant and equipment.
The gain or loss on disposal of an item of property, plant and equipment is determined by
comparing the proceeds from disposal with the carrying amount of property, plant and
equipment, and is recognised net within other income in profit or loss.
Subsequent costs
The cost of replacing a component of an item of property, plant and equipment is recognised in
the carrying amount of the item if it is probable that the future economic benefits embodied
within the component will flow to the Group, and its cost can be measured reliably. The
carrying amount of the replaced component is derecognised. The costs of the day-to-day
servicing of property, plant and equipment are recognised in profit or loss as incurred.
Depreciation
•
Depreciation is based on the cost of an asset less its residual value. Significant components of
individual assets are assessed and if a component has a useful life that is different from the
remainder of that asset, that component is depreciated separately.
•
Depreciation is recognised in profit or loss on a straight-line basis over the estimated useful
lives of each component of an item of property, plant and equipment, since this most closely
reflects the expected pattern of consumption of the future economic benefits embodied in the
asset. Leased assets are depreciated over the shorter of the lease term and their useful lives
unless it is reasonably certain that the Group will obtain ownership by the end of the lease term.
Page 31
The estimated useful lives for the current and comparative years are as follows:
Leasehold land 20 to 99 years (over remaining lease term)
Buildings
20 to 40 years
Computer, gaming and betting equipment 3 to 5 years
Other assets 3 to 10 years
No depreciation is provided on capital work-in-progress.
Depreciation methods, useful lives and residual values are reviewed at the end of each reporting
period and adjusted if appropriate.
Fully depreciated assets are retained in the financial statements until they are no longer in use.
Other assets include racecourse equipment, furniture and fittings, mechanical and electrical
installations, motor vehicles, livestock and renovations.
Assets costing less than $1,000 per unit are charged to profit or loss in the year of purchase.
3.5Reversionary interest in trusts
The reversionary interest in trusts is stated at cost less allowance for impairment in value of the
principal sum.
3.6Intangible assets
Goodwill
Goodwill represents the excess of the fair value of the consideration transferred over the net
recognised amount (generally fair value) of the identifiable assets acquired and liabilities
assumed.
Goodwill arising on the acquisition of subsidiaries is presented in intangible assets.
Goodwill is measured at cost less accumulated impairment losses.
Software development expenditure
Software development expenditure is initially capitalised at cost and subsequently carried at
cost less accumulated amortisation and accumulated impairment losses.
Subsequent expenditure
Subsequent expenditure on software development is capitalised only when it increases the
future economic benefits embodied in the specific asset to which it relates. All other
expenditure is recognised in profit or loss as incurred.
Page 32
Amortisation
Amortisation of software development expenditure is calculated over the cost of the asset, less
its residual value.
Amortisation is recognised in profit or loss on a straight-line basis over the estimated useful life
of 5 years, from the date that they are available for use, since this most closely reflects the
expected pattern of consumption of the future economic benefits embodied in the asset.
Amortisation methods, useful lives and residual values are reviewed at the end of each reporting
period and adjusted if appropriate.
3.7Impairment
Non-derivative financial assets
A financial asset not carried at fair value through profit or loss is assessed at the end of each
reporting period to determine whether there is objective evidence that it is impaired. A financial
asset is impaired if objective evidence indicates that a loss event has occurred after the initial
recognition of the asset, and that the loss event had a negative effect on the estimated future
cash flows of that asset that can be estimated reliably.
Objective evidence that financial assets (including equity securities) are impaired can include
default or delinquency by a debtor, restructuring of an amount due to the Group on terms that
the Group would not consider otherwise, indications that a debtor or issuer will enter
bankruptcy, adverse changes in the payment status of borrowers or issuers in the Group,
economic conditions that correlate with defaults or the disappearance of an active market for a
security. In addition, for an investment in an equity security, a significant or prolonged decline
in its fair value below its cost is objective evidence of impairment.
s
The Group considers evidence of impairment for loans and receivables at both a specific asset
and collective level. All individually significant loans and receivables are assessed for specific
impairment. All individually significant receivables found not to be specifically impaired are
then collectively assessed for any impairment that has been incurred but not yet identified.
Loans and receivables that are not individually significant are collectively assessed for
impairment by grouping together loans and receivables with similar risk characteristics.
In assessing collective impairment, the Group uses historical trends of the probability of default,
the timing of recoveries and the amount of loss incurred, adjusted for management's judgement
as to whether current economic and credit conditions are such that the actual losses are likely to
be greater or less than suggested by historical trends.
•
•
An impairment loss in respect of a financial asset measured at amortised cost is calculated as the
difference between its carrying amount and the present value of the estimated future cash flows
discounted at the asset's original effective interest rate. Losses are recognised in profit or loss
and reflected in an allowance account against loans and receivables. Interest on the impaired
asset continues to be recognised through the unwinding of the discount. When a subsequent
event causes the amount of impairment loss to decrease, the decrease in impairment loss is
reversed through profit or loss.
Page 33
Non-financial assets
The carrying amounts of the Group's non-financial assets are reviewed at each reporting date to
determine whether there is any indication of impairment. If any such indication exists, then the
asset's recoverable amount is estimated. For goodwill, the recoverable amount is estimated
each year at the same time. An impairment loss is recognised if the carrying amount of an asset
or its related cash-generating unit (CGU) exceeds it estimated recoverable amount.
The recoverable amount of an asset or CGU is the greater of its value in use and its fair value
less costs to sell. In assessing value in use, the estimated future cash flows are discounted to
their present value using a pre-tax discount rate that reflects current market assessments of the
time value of money and the risks specific to the asset or CGU. For the purpose of impairment
testing, assets that cannot be tested individually are grouped together into the smallest group of
assets that generates cash inflows from continuing use that are largely independent of the cash
inflows of other assets or CGU. For the purposes of goodwill impairment testing, CGUs to
which goodwill has been allocated are aggregated so that the level at which impairment testing
is performed reflects the lowest level at which goodwill is monitored for internal reporting
purposes. Goodwill acquired in a business combination is allocated to groups of CGUs that are
expected to benefit from the synergies of the combination.
Impairment losses are recognised in profit or loss. Impairment losses recognised in respect of
CGUs are allocated first to reduce the carrying amount of any goodwill allocated to the CGU
(group of CGUs), and then to reduce the carrying amounts of the other assets in the CGU (group
of CGUs) on a pro rata basis.
An impairment loss in respect of goodwill is not reversed. In respect of other assets,
impairment losses recognised in prior periods are assessed at each reporting date for any
indications that the loss has decreased or no longer exists. An impairment loss is reversed if
there has been a change in the estimates used to determine the recoverable amount. An
impairment loss is reversed only to the extent that the asset's carrying amount does not exceed
the carrying amount that would have been determined, net of depreciation or amortisation, if no
impairment loss had been recognised.
3.8Employee benefits
Defined contribution plans
A defined contribution plan is a post-employment benefit plan under which an entity pays fixed
contributions into a separate entity and will have no legal or constructive obligation to pay
further amounts. Obligations for contributions to defined contribution pension plans are
recognised as an employee benefit expense in profit or loss in the periods during which services
are rendered by employees.
Short-term employee benefits
Short-term employee benefit obligations are measured on an undiscounted basis and are
expensed as the related service is provided. A liability is recognised for the amount expected to
be paid under short-term cash bonus or profit-sharing plans if the Group has a present legal or
constructive obligation to pay this amount as a result of past service provided by the employee,
and the obligation can be estimated reliably.
Page 34
Employee leave entitlement
Employee entitlements to annual leave are recognised when they accrue to employees. A
provision is made for the estimated liability for annual leave as a result of services rendered by
employees up to the statement of financial position date.
3.9Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or
constructive obligation that can be estimated reliably, and it is probable that an outflow of
economic benefits will be required to settle the obligation.
111
Restoration costs
Where required by the lease agreements to restore the premises to its original condition, an
estimate is made for the costs of dismantling and removing an asset and restoring the site which
is recognised at the commencement of the lease and amortised over the period of the lease.
3.10Revenue recognition
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the
Group and revenue can be reliably measured.
•Totalisator revenue
Revenue from the totalisator is recognised upon the completion of each race.
Scratchit! Lotteries
Revenue from Scratchit! Lotteries is recognised upon sale of the tickets.
Games and lotteries
Collections from games and lotteries are recognised as revenue by draw and by match.
Gate admission fees income
Revenue is recognised upon the usage of the admission tickets.
Racing management, betting and other revenue
Revenue is recognised on an accrual basis unless collectability is in doubt.
Dividend income
•
Dividend income is recognised when the right to receive payment is established.
Interest income
Interest income is recognised on a time-proportion basis using the effective interest method.
•Casino entry levy
Casino entry levy is recognised when the right to receive payment is established.
Page 35
3.11Government grants
Government grants for the purchase of depreciable property, plant and equipment are taken
direct to the deferred capital grants account, and included in non-current liabilities in the
statement of financial position.
The deferred capital grants are recognised in profit or loss as non-operating income over the
periods necessary to match the depreciation and gain or loss on disposal or write-off of
property, plant and equipment purchased with the related grants.
Jobs Credit Scheme
Cash grants received from the government in relation the Jobs Credit Scheme are recognised as
income upon receipt.
3.12Lease payments
Leases of property, plant and equipment where a significant portion of the risks and rewards of
ownership are retained by the lessor are classified as operating leases. Payments made under
operating leases are recognised in profit or loss on a straight-line basis over the term of the
lease. Lease incentives received are recognised as an integral part of the total lease expense,
over the term of the lease.
When an operating lease is terminated before the lease period has expired, any payment made
(or received) by the Group as penalty is recognised as an expense (or income) when termination
takes place.
3.13Donations
Donations are taken to profit or loss when there is an obligation to disburse.
3.14Income tax
The Singapore Totalisator Board is a tax-exempted institution under the provisions of the
Income Tax Act (Cap. 134 2004 Revised Edition). The subsidiaries of the Board are subject to
local income tax legislation.
Income tax expense comprises current and deferred tax. Current tax and deferred tax are
recognised in profit or loss except to the extent that it relates to items recognised directly in
equity or in other comprehensive income.
Current tax is the expected tax payable or receivable on the taxable income or loss for the year,
using tax rates enacted or substantively enacted at the reporting date, and any adjustment to tax
payable in respect of previous years.
Deferred tax is recognised in respect of temporary differences between the carrying amounts of
assets and liabilities for financial reporting purposes and the amounts used for taxation
purposes. Deferred tax is not recognised for temporary differences on the initial recognition of
assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit or loss, and temporary differences related to investments in
subsidiaries to the extent that it is probable that they will not reverse in the foreseeable future.
Page 36
Deferred tax is measured at the tax rates that are expected to be applied to temporary differences
when they reverse, based on the laws that have been enacted or substantively enacted by the
reporting date.
Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current
tax liabilities and assets, and they relate to income taxes levied by the same tax authority on the
same taxable entity, or on different tax entities, but they intend to settle current tax liabilities
and assets on a net basis or their tax assets and liabilities will be realised simultaneously.
A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary
differences, to the extent that it is probable that future taxable profits will be available against
which they can be utilised. Deferred tax assets are reviewed at each reporting date and are
reduced to the extent that it is no longer probable that the related tax benefit will be realised.
3.15Club memberships
Club memberships are stated at cost less accumulated impairment losses. Gain or loss on
disposal of club membership is determined as the difference between the net disposal proceeds
and the carrying amount of the club membership and is accounted for in profit or loss as they
arise.
Page 37
4Property, plant and equipment
Group
Cost
At 1 April 2009
Additions
Disposals
Reclassifications
At 31 March 2010
Additions
Disposals
Transfer to intangible assets (Note 5)
Reclassifications
At 31 March 2011
Leasehold
land
2,629,701
Buildings
Capital
Otherwork-inassetsprogressTotal
51,358,633
565,535,931
23,167,592
(558,297)
110,425,648
2,595,966
(19,356,368)
2,208,497
95,873,743
4,218,614
(1,773,791)
240,147,630
11,776,239
(8,855,366)
40,102,711
283,171,214
15,016,689
(4,629,873)
(101,251,654)
486,893,572
8,735,162
107,053,728
139,409,368
432,967,398
824,298
66,676
127,086,471
13,755,493
890,974
545,797
93,096,589
9,428,646
(19,354,666)
(11,100)
83,159,469
8,868,368
(1,771,815)
185,871,036
19,461,320
(8,474,964)
11,100
196,868,492
104,363,261
(4,512,027)
30,023,768
326,743,494
2,629,701
120,738,480
123,368,181
513,552,069
625,229
Computer
and betting
equipment
Accumulated depreciation
At 1 April 2009
Depreciation charge for the year
Disposals
Reclassifications
At 31 March 2010
Disposals
Reclassifications
At 31 March 2011
1,436,771
140,841,964
14,253,639
(157,920)
(30,023,768)
124,913,915
Carrying amount
At 1 April 2009
1,805,403
386,465,598
At 31 March 2010
At 31 March 2011
1,738,727
121,931,410
424,693,967
361,979,657
90,256,022
17,329,059
12,714,274
16,797,706
46,900,176
913,655,224
75,616,082
90,613,516
(503)
(28,212,237)
(93,669,841)
28,845,914
976,056,503
30,210,493
193,351,868
(14,508)
(6,976,469)
(4,127,736)
(4,127,736)
(46,892,876)
8,021,287 1,158,304,166
406,878,394
42,712,135
(27,829,630)
421,760,899
128,031,065
(6,441,762)
543,350,202
54,276,594
46,900,176
506,776,830
86,302,722
106,223,904
28,845,914
8,021,287
554,295,604
614,953,964
Page 38
•••
•I•
Board
Cost
At 1 April 2009
Additions
Disposals
Reclassifications
At 31 March 2010
Additions
Disposals
Reclassifications
At 31 March 2011
Accumulated depreciation
At 1 April 2009
Disposals
Reclassifications
At 31 March 2010
Disposals
Reclassifications
At 31 March 2011
Carrying amount
At 1 April 2009
At 31 March 2010
At 31 March 2011
Leasehold
land
2,629,701
Buildings
513,552,069
625,229
Computer
and betting
equipment
Capital
work-inOther assetsprogress Total
83,114,956
1,358,150
(18,431,624)
1,918,396
67,959,878
1,150,466
(634,827)
5,726,797
74,202,314
210,071,450
11,115,519
(8,641,769)
40,026,314
252,571,514
8,958,295
(4,030,452)
138,315,345
395,814,702
71,250,857
6,040,010
(18,430,169)
(11,100)
58,849,598
5,043,696
(634,093)
63,259,201
159,300,786
18,052,354
(8,262,192)
11,100
169,102,048
102,054,894
(3,929,025)
30,023,768
297,251,685
2,629,701
51,358,633
565,535,931
657,028
(558,297)
(101,251,654)
464,383,008
824,298
66,676
127,086,470
13,755,493
890,974
66,676
957,650
140,841,963
14,066,051
(157,920)
(30,023,768)
124,726,326
1,805,403
386,465,599
11,864,099
50,770,664
1,738,727
1,672,051
424,693,968
339,656,682
9,110,280
10,943,113
83,469,466
98,563,017
2,629,701
44,290,575
68,049,495
(93,303,343)
19,036,727
28,971,108
(42,790,488)
5,217,347
853,658,751
81,148,393
(27,073,393)
907,733,751
39,736,897
(5,223,576)
942,247,072
358,462,411
37,914,533
(26,692,361)
369,684,583
121,231,317
(4,721,038)
486,194,862
44,290,575
19,036,727
5,217,347
495,196,340
538,049,168
456,052,210
Included in additions for the current financial year of the Group and the Board is provision for restoration costs made during the year amounting to $832,270.
Page 39
Depreciation expense of the Board charged to the statement of comprehensive income
comprises the following:
Board
2011
2010
Depreciation expense on the Board's assets
Depreciation expense charged by an agent for depreciation on
the agent's assets*
121,231,317
37,914,533
6,799,748
128,031,065
4,797,602
42,712,135
* Under the agency arrangement, depreciation expense on assets held by the agent is borne by
the Board.
5Intangible assets
Group
2011
Software development
expenditure
Goodwill arising on
consolidation
Software development
expenditure
Cost
At 1 April
Additions during the year
Transfer from capital work-inprogress (Note 4)
At 31 March
Accumulated amortisation
At 1 April
Amortisation charged during
the year
At 31 March
Carrying amount
At 1 April
At 31 March
Board
2010
2011
2010
6,328,349
2,215,306
2,850
57,569,391
63,897,740
57,569,391
59,784,697
2,850
15,984,453
2,103,845
15,763,122
221,331
3,420
4,127,736
22,216,034
15,984,453
3,420
13,769,147
11,629,831
2,118,538
15,887,685
2,139,316
13,769,147
570
570
2,215,306
6,328,349
4,133,291
2,215,306
2,850
Under the agency arrangement, the amortisation of intangible assets held by the agent is borne
by the Board.
Goodwill arising on consolidation
Goodwill arises from the excess of purchase consideration over the fair values of attributable net
assets of Singapore Pools (Private) Limited, a wholly-owned subsidiary which is considered as
a separate cash-generating unit (CGU).
Page 40
Impairment testing of goodwill
The recoverable amounts of the CGU are determined based on value-in-use calculations. The
following describes the key assumptions on which management has based its cash flow
projection:
Budgeted gross margins of 10% (2010: 10%).
Pre-tax discount rate of 11% (2010: 11%).
The cash flow projections is based on actual operating results and management's 3-year
financial projection of the operations for the years 2012 to 2014 based on management's
past experience and future expectations.
Management has determined budgeted gross margins based on past performance and its
expectation of market development. The pre-tax discount rates applied reflect specific risks
relating to the relevant business activities.
Management believes that any reasonable possible change in the above key assumptions is not
likely to materially cause the recoverable amount to be lower than its carrying amount.
No impairment loss has been recognised for the financial years ended 31 March 2011 and 2010.
6Investment in subsidiaries
Board
20112010
Unquoted shares, at cost
58,569,39158,569,391
Details of the subsidiaries are as follows:
Name of subsidiaries Principal activities
Place ofEffective
incorporation equity held by
and business the Board
2011 2010
% %
Singapore Pools
To operate lotteries and sports Singapore 100100
(Private) Limited
betting as an agent on behalf of the
Board
Held by Singapore Pools (Private) Limited
Selegie Management To provide services to manage and Singapore100100
Pte Ltd operate the Livewire operations at
the Integrated Resorts premises.
KPMG LLP is the auditor of all subsidiaries.
Page 41
7Reversionary interest in trusts
Group and Board
2011 2010
Reversionary interest in trusts, at cost
Less: Accumulated impairment losses
At 1 April
Impairment losses written-back during the year
At 31 March
50,000,000
50,000,000
(277,776)
14,914
(262,862)
49,737,138
(5,080,482)
4,802,706
(277,776)
49,722,224
Write-back of impairment is recognised in non-operating income in the statement of
comprehensive income.
On 28 May 1989, the Board set up the Singapore Totalisator Board Trust (the Trust), to which
the Board transferred $25,000,000. The income derived from this sum is to be distributed to the
Singapore Symphonia Company Limited from time to time.
The Trust will continue until the expiration of 21 years after the death of the last surviving
original trustee. Upon the expiry of the Trust period or in the event the Trust becomes
incapable of performance, the capital sum will revert to the Board.
On 15 April 1994 and 24 October 1996, the Board set up two other trusts, called the Singapore
Totalisator Board SDT Trust (the SDT Trust) and the Singapore Totalisator Board SCO Trust
(the SCO Trust), to which the Board transferred $15,000,000 and $10,000,000 respectively.
The income derived from the SDT Trust and the SCO Trust is to be distributed to the Singapore
Dance Theatre (SDT) and the Singapore Chinese Orchestra (SCO) respectively from time to
time.
Both the SDT Trust and the SCO Trust will continue until 21 years after the date of the death of
the last survivor of all the lineal descendants male and female of His late Majesty King George
the Sixth of England living as at 15 April 1994 and 24 October 1996 respectively. Upon the
expiry of the Trust period or upon the winding up of SDT or SCO themselves, whichever occurs
first, the capital sum will revert to the Board.
8Loan to a subsidiary
The loan to a subsidiary is unsecured, bears interest at 2% per annum and is not expected to be
repaid in the next 12 months.
Page 42
9
Club memberships
Group
2011
Club memberships, at cost
Less: Allowance for
impairment losses
At 1 April
Impairment losses (made)/
written back during the year
At 31 March
•
1,990,000
Board
2010
2011
1,990,000
2010
840,000
840,000
(792,000)
(965,000)
(590,000)
(590,000)
(21,000)
(813,000)
1,177,000
173,000
(792,000)
1,198,000
(590,000)
250,000
(590,000)
250,000
During the year, as a result of the decrease (2010: increase) in the market value of the club
memberships, impairment losses on club memberships amounting to $21,000 (2010: write-back
of impairment losses of $173,000) was recognised in the statement of comprehensive income.
10Financial assets at fair value through profit or loss
Group and Board
20112010
•
Unquoted unit trusts at fair value
1,993,912,795 1,808,440,312
The fair values of unquoted financial assets are based on bid prices quoted by brokers or
valuation provided by professional fund managers. The unquoted unit trusts are in diversified
portfolios of various asset classes managed by professional fund managers recommended by the
Board's investment consultant.
•
•
•
•
11
Trade and other receivables
Group
20112010
$ $
Trade receivables Amounts due from a subsidiary
Deposits
Dividend receivable
Interest receivable
Staff loans
Casino entry levy receivable
Advances to retailers
Management fee rebate
receivables
Other receivables
Prepayments
Board
2011
$
2010
$
24,522,952 16,003,933
3,625,118
2,861
2,633,694
13,200
16,829,310
4,541,600
3,449,915
2,861
339,505
6,600
23,739,500
17,907,600
454,883
3,532,277
56,155,895
2,111,504
58,267,399
1,843,868
63,293,782
2,538,373
65,832,155
38,223,752
1,209,481
2,861
2,623,789
12,900
16,829,310
20,881,454
1,126,159
2,861
313,336
6,600
23,739,500
454,883
2,295,452
61,652,428
983,578
62,636,006
1,841,116
47,911,026
1,004,647
48,915,673
Page 43
Trade and other receivables are principally denominated in Singapore dollar and the carrying
amounts approximate their fair values.
The amounts due from a subsidiary, Singapore Pools (Private) Limited, relate to transactions
arising from the lottery and betting business on behalf of the Board. The amounts are
unsecured, interest-free and denominated in Singapore dollar. There is no allowance for
doubtful debt arising from these amounts and their carrying amounts approximate their fair
values.
The Group and the Board's exposure to credit risks and impairment loss related to trade and
other receivables are disclosed in Note 25.
12Cash and cash equivalents
Group
2011
Short-term bank deposits
Cash at bank and in hand
Cash with AGD
Board
2010
201,310,000 1,045,643,306
96,653,936 133,278,328
779,549,338
1,077,513,274 1,178,921,634
2011
2010
41,978,546
779,549,338
821,527,884
861,000,000
73,721,753
934,721,753
Cash with the Accountant-General's Department (AGD) refers to cash that are managed by
AGD under Centralised Liquidity Management as set out in the Accountant-General's Circular
No. 4/2009 Centralised Liquidity Management for Statutory Boards and Ministries, which are
transferred to AGD under the overnight sweeping arrangement between both parties.
Cash and cash equivalents are principally denominated in Singapore dollar and the carrying
Short-term bank deposits at the statement of financial position date have an average maturity of
0.5 month (2010: 1 month) from the end of the financial year with the following weighted
average effective interest rates:
Group and Board
2011 2010
%
Singapore dollar
0.190.41
The interest rate of cash with AGD, defined as the ratio of the interest earned to the average
cash balance, range from 0.44% to 0.67% (2010: Nil) per annum.
The Group and the Board's exposure to interest rate risk for financial assets and liabilities are
disclosed in Note 25.
13Capital account
The capital account consists of the value of net assets transferred from the former Singapore
Turf Club on the establishment of the Board on 1 January 1988 and a Government grant of
$500,000.
Page 44
14Deferred tax liabilities
Movements in deferred tax assets and liabilities (prior to offsetting of balances) during the year
are as follows:
Group
Recognised in
Recognised in
profit or loss
At
Atprofit or loss
At
1/4/2009(Note 22)
31/3/2010
(Note 22)
31/3/2011
Deferred tax
liabilities
Property, plant
and
equipment
Deferred tax assets
Provision for donation
1,773,740(194,000) 1,579,740
(3,740)
(3,740
913,0222,492,762
(1,530(5,270
Deferred tax liabilities and assets are offset when there is a legally enforceable right to set off
current tax assets against current tax liabilities and when the deferred taxes relate to the same
taxation authority. The following amounts, determined after appropriate offsetting are as
follows:
20112010
Deferred tax liabilities
2,487,4921,576,000
15Deferred capital grants
Group and Board
20112010
At 1 April
Addition during the year
Amortisation for the year
At 31 March
360,038,882
372,181,641
75,000
(87,226,631) (12,217,759)
272,812,251
360,038,882
16Government grants received in advance
Government grants were received for the development of the Kranji race course and the amount
as at 31 March 2011 and 2010 represent the unutilised portion of the grant.
17Other payables and accruals
Group
Accrued operating expenses
Advance sales
Other payables
Board
2011
2010
2011
2010
164,129,452
17,638,933
31,101,423
212,869,808
181,120,410
15,568,747
28,379,849
225,069,006
24,416,630
28,151,927
31,101,423
55,518,053
28,379,849
56,531,776
Page 45
Advance sales relate to collections for draws and matches that are held subsequent to the
statement of financial position date.
Other payables and accruals are primary denominated in Singapore dollar and their carrying
18Provision for donations
Group
2011
At 1 April
Provision made
Provision utilised
At 31 March
Board
2010
31,000
5,484,110
(379,836)
5,135,274
2011
2,011,000
81,617
(2,061,617)
31,000
2010
2,000,000
5,104,274
(2,000,000)
5,104,274
19Provision for contribution to Consolidated Fund
The Board contributes to the Consolidated Fund in accordance with Section 3(a) of the
Statutory Corporations (Contributions to Consolidated Fund) Act (Chapter 319A, 2004 Revised
Edition). The contribution for 2011 is to be based on the Board's net surplus for 2011 at the
applicable corporation tax rate of 17% (2010: 17%).
Under Section 13 (1)(e) and the First Schedule of the Singapore Income Tax Act (Chapter 134,
2008 Revised Edition), the income of the Board is exempt from income tax.
20Operating surplus
(a) Income from betting and gaming activities
Group and Board 2011
Turnover*
Totalisator
Lotteries
Sports betting
Total
1,848,150,522
5,102,524,360
1,134,116,729
8,084,791,611
Dividends/prizes paid
(1,492,950,334) (3,365,455,079)
(955,365,018) (5,813,770,431)
Betting tax
(93,610,714) (1,275,658,877)
(47,924,227) (1,417,193,818)
Commission
(41,152,878)
(2,688,255)
(43,841,133)
Withholding tax expense
(206,222)
(206,222)
Dividends, prizes and
other expenses
(1,586,767,270) (4,682,266,834) (1,005,977,500) (7,275,011,604)
Income from betting and
gaming activities
261,383,252
420,257,526
128,139,229
809,780,007
Page 46
Group and Board 2010
Turnover*
Totalisator
Lotteries
Sports betting
Total
2,094,648,281
4,997,471,070
1,022,151,326
8,114,270,677
Dividends/prizes paid
(1,702,873,595) (3,154,966,845)
(103,434,048) (1,249,220,951)
Betting tax
Commission
(40,654,029)
Withholding tax expense
(145,939)
Dividends, prizes and
other expenses
(1,806,453,582) (4,444,841,825)
Income from betting and
gaming activities
288,194,699
552,629,245
(873,435,472) (5,731,275,912)
(41,265,298) (1,393,920,297)
(43,263,174)
(2,609,145)
(145,939)
(917,309,915) (7,168,605,322J
104,841,411
945,665,355
* Turnover represents wagered amounts received in respect of bets placed by customers
during the financial year.
(b) Other operating income
Group
2011
Board
2010
2011
Restated
Gate admission fees
income
Racing management,
betting and other
revenue
Rental income
Insurance claim proceeds
Golf course revenue
Members' subscription
and entrance fees
Government grant — Jobs
Credit
Maternity and childcare
leave
Sundry income
2010
Restated
10,869,426
11,682,407
10,869,426
11,682,407
14,215,945
5,885,746
17,521
860,029
12,004,290
5,017,571
161,717
1,119,093
14,210,945
5,885,746
17,521
860,029
11,999,290
5,017,571
161,717
1,119,093
1,557,540
1,715,702
1,557,540
1,715,702
421,673
5,540,140
421,673
5,540,140
178,795
2,395,509
36,402,184
204,620
1,976,273
39,421,813
178,795
2,121,347
36,123,022
204,620
1,890,774
39,331,314
Racing management, betting and other revenue includes royalty fees collected for the sale of
broadcasting rights of Singapore races, equine hospital charges and miscellaneous revenue.
Page 47
(c) Staff costs
Group
Board
2011 2010 2011 2010
Restated
Wages and salaries
Contributions to defined
contribution scheme
Others
Restated
97,426,321
97,603,813
91,880,422
87,275,502
9,698,719
4,701,511
111,826,551
9,890,131
6,346,080.
113,840,024
8,839,104
4,701,511
105,421,037
8,392,526
6,346,080
102,014,108
Under the agency arrangement, all the staff costs of Singapore Pools (Private) Limited (except
variable bonuses) are borne by the Board.
Racing and related expenses
Of the $110.5 million (2010: $102.6 million), $67.8 million (2010: $61.5 million) or 61.4%
(2010: 59.9%) pertained to prize money paid to horse owners, trainers and jockeys of the
winning horses.
Office and property related expenses
Office and property related expenses include the following expense:
Group
2011
$
Operating lease expenses
21
31,360,506
Board
2010
$
23,766,816
2011
$
31,360,506
2010
$
23,766,816
Investment income
Group
20112010
Changes in carrying values
of investments
Gain on disposal of
investments
Management fee rebate
Interest income
Dividend income
Investment expenses
Miscellaneous
income/(expenses)
91,733,125
270,350,254
91,733,125
1,989,504
3,999,405
73,771
(205,275)
1,906,489
4,715,925
225,477
1,906,489
5,173,525
12,084
99,050,700
Board
20112010
270,350,254
225,477
32,015
276,239,674
1,989,504
3,585,148
(205,275)
(66,753)
98,514,263
(206,812)
275,512,819
Page 48
22Income tax credit
The Board is a tax exempted institution under the provision of the Income Tax Act (Cap.143,
2004 Revised Edition). The subsidiaries of the Board are subject to tax under Singapore income
tax legislation.
Group
20112010
Current tax expense
Current year
Adjustment for prior years
200,1551,335,340
(2,033,377) (1,977,131)
(1,833,222)
(641,791)
Deferred tax expense
Origination and reversal of temporary differences
Adjustment for prior years
806,587
104,905
911,492
(921,730)
(194,000)
Surplus before tax
314,905,707
472,106,819
Income tax using Singapore tax rate of 17% (2010: 17%)
Surplus of the Board exempted from tax
Recognition of previously unrecognised tax losses
Non-deductible expenses
Tax exempt income
Double deduction on qualifying donations
Over provided in prior years
Others
53,533,970
(52,506,766)
80,258,159
(79,539,765)
(240)
512,382
(68,155)
(20,950)
(1,977,131)
(91)
(835,791)
(194,000)
(835,791)
Reconciliation of effective tax rate
68,142
(26,417)
(62,187)
(1,928,472)
(921,730)
23Commitments
(a) Future capital commitments
As at 31 March 2011, the capital expenditures approved and contracted but not provided for in
the financial statements are as follows:
Group
Board
2011
20112010
2010
Property, plant and equipment
21,444,007
27,583,868
20,066,72717,433,213
•
Page 49
Operating lease commitments — where the Group is a lessee
As at 31 March 2011, the commitments for future minimum lease payments in respect of noncancellable operating leases are as follows:
Group
2011
$
Within 1 year
After 1 year but within 5 years
After 5 years
32,547,329
58,948,593
19,083,063
110,578,985
Board
2010
$
28,108,594
63,647,124
21,362,330
113,118,048
2011
$
2010
$
18,821,318
39,084,597
16,053,663
73,959,578
16,755,788
43,749,337
21,362,330
81,867,455
The group has various leases for betting outlets and off-course betting centres. These leases
typically run for a period of 1 to 5 years with an option to renew after the lease after that date.
The leases do not include any contingent rentals.
Operating lease commitments — where the Group is a lessor
As at 31 March 2011, the commitments for future minimum lease receivables in respect of noncancellable operating leases are as follows:
Group and Board
2011
2010
Within 1 year
After 1 year but within 5 years
1,734,764
1,765,669
3,500,433
2,031,886
2,992,422
5,024,308
Donations approved and committed but not disbursed
The following donations have not been provided for in the financial statements:
Group
20112010
Approved, but not recognised
in the financial statements
Board
2011
2010
1,375,750,598 1,424,343,004 1,375,187,098 1,423,343,504
Page 50
24Key management personnel compensation
Group
Salaries and other short-term employee benefits
Post-employment benefits — contribution to CPF
•
•
Included in key management personnel compensation are
compensation for:
- members of the Board
-directors of a subsidiary
2011
2010
6,815,876
109,611
6,925,487
7,185,389
109,660
7,295,049
99,605
1,436,766
1,536,371
112,500
1,707,599
1,820,099
25Financial risk management
Overview
The Group has exposure to the following risks from its use of financial instruments:
risk
•• credit
liquidity risk
interest rate risk
price risk
foreign currency risk
capital risk
This note presents information about the Group's exposure to each of the above risks and the
Group's objectives, policies and processes for measuring and managing risks. Further
quantitative disclosures are included throughout these financial statements.
•
•
Credit risk
Credit risk is defined as the potential loss arising from failure by counterparties to fulfil their
obligations as and when they fall due. The Group has policies in place to only deal with
counterparties who meet certain credit requirements, and requires collateral to reduce its risk.
Credit risk refers to the risk that a counterparty will default on its contractual obligations
resulting in financial loss to the Group. The major classes of financial assets of the Group are
unit trusts managed by professional fund managers, bank deposits and trade receivables. The
Group limits its credit risk exposure in respect of investments by placing its funds only with
professional fund managers recommended by an investment consultant. For trade receivables,
the Group adopts the policy of dealing only with customers of appropriate credit history, and
obtaining sufficient collateral, where appropriate, to mitigate credit risk. For other financial
assets, the Group adopts the policy of dealing only with high credit quality counterparties.
Credit exposure to an individual counterparty is restricted by credit limits that are approved by
the management based on ongoing credit evaluation. The counterparty's payment profile and
credit exposure are continuously monitored at the entity level by the respective management.
Page 51
The maximum exposure to credit risk for each class of financial instruments is the carrying
amount of that class of financial instruments presented in the statement of financial position
except for trade receivables and advances to retailers.
In order to manage the Group's credit risk for trade receivables and advances to retailers, the
Group obtains bankers' guarantees issued by their customers' banks for most of the customers.
These bankers' guarantees are then used as a form of security against the outstanding trade
receivables and advances to retailers. As at statement of financial position date, the bankers'
guarantees amounted to $24,588,000 (2010: $29,919,152).
As at the end of the financial year, there is no significant concentration of credit risk on the
trade receivables and advances to retailers of the Group.
The credit risk for trade receivables and advances to retailers based on the information provided
to management is as follows:
Group
2011
2010
By types of customers
Distributors
Retailers
Others
2,319,490
25,637,646
1,107,416
29,064,552
2,252,071
28,748,594
2,910,868
33,911,533
The age analysis of loans and receivables is as follows:
Group
2011
Not past due
Past due less than 3 months
Past due 3 to 6 months
Past due over 6 months
55,862,290
290,744
2,861
56,155,895
2010
62,825,657
432,749
2,960
32,416
63,293,782
Board
2011
61,457,733
191,834
2,861
61,652,428
2010
47,463,335
412,315
2,960
32,416
47,911,026
Based on historical default rates, the Group believes that no impairment allowance is necessary
in respect of loans and receivables. These receivables are mainly due from customers that have
a good payment record with the Group.
Cash and fixed deposits are placed in banks and financial institutions which are regulated. The
cash with AGD under Centralised Liquidity Management are placed with high credit quality
financial institutions.
The Group limits its credit risk exposure in respect of investments by only investing in liquid
securities and only with counterparties with high credit-ratings assigned by international creditrating agencies.
Page 52
•
Liquidity risk
The Group monitors its liquidity risk and maintains a level of cash and cash equivalents deemed
adequate by management to finance the Group's operations and to mitigate the effects of
fluctuations in cash flows.
All trade, other payables and accruals of the Group in 2011 and 2010 are payable within one
year.
Interest rate risk
•
•
The Group's exposure to market risk for changes in interest rates relates primarily to the interest
bearing debt securities, fixed deposits and cash with AGD. The interest rates for cash with
AGD are based on deposit rates determined by the financial institutions with which the cash are
deposited and are expected to move in tandem with market interest rate movements.
The Group does not have any borrowings as at the end of the financial year.
At the reporting date, the interest rate profile of the interest-bearing financial instruments was:
Group
Carrying amount
2011
2010
•
Board
Carrying amount
2011
2010
Variable rate instrument
Fixed deposits
Cash with AGD
201,310,000 1,045,643,306
779,549,338
980,859,338 1,045,643,306
861,000,000
779,549,338
779,549,338
861,000,000
Cash flow sensitivity analysis for variable rate instruments
•
•
•
•
A change of 100 basis points in interest rates at the reporting date would have increased/
(decreased) surplus before tax by the amounts shown below. This analysis assumes that all
other variables, in particular foreign currency rates, remain constant. The analysis is performed
on the same basis for 2010.
Surplus before tax
100 bp100 bp
IncreaseDecrease
Group
2011
Variable rate instruments
9,808,593 (9,808,593)
2010
10,456,433(10,456,433)
Board
2011
2010
7,795,493 (7,795,493)
8,610,000(8,610,000)
Page 53
Price risk
Surplus funds from the Group's operations are mainly invested in unit trusts managed by
professional fund managers. To manage its price risk arising from investments, the Group
diversifies its portfolio. The amount invested as at 31 March 2011 was $1,993,912,795 (2010:
$1,808,440,312).
The unit trusts are unquoted. The market risk associated with these investments is the potential
loss in fair value resulting from the decrease in prices of unit trusts.
The Group's investment strategies and policies are determined by Tote Board's Investment
Committee and approved by the Board.
A 5% increase/(decrease) in the underlying prices at the reporting date would
increase/(decrease) surplus after tax for the year by the following amount:
20112010
Group and Board
Surplus after tax for the year
82,747,38175,050,273
This analysis assumes that all other variables remain constant.
Foreign currency risk
The Group operates solely in Singapore. The Group is exposed to foreign currency exchange
rate volatility primarily for Australian dollars (AUD) on purchases of goods and services, which
arises from the daily course of operations. Other than the AUD, the Group's business
operations are not exposed to significant foreign currency risks as it has no other significant
transactions denominated in foreign currencies. The Group monitors currency exposures
closely to ensure that there is no significant exposure to a single foreign currency.
The Group does not engage in speculative foreign exchange transactions.
Capital management
The Group has a strong capital base and does not need to borrow. The Group is not subject to
externally imposed capital requirement.
The Board proactively manages its capital structure to achieve efficiency in its cost of capital.
The quantum of minimum and maximum cash reserve, taking into account working capital
needs and long-term commitments, is reviewed and approved annually by the Board Members.
Fair values
Determination offair values
Fair values have been determined for measurement and/or disclosure purposes based on the
following methods. Where applicable, further information about the assumptions made in
determining fair values is disclosed in the notes specific to that asset or liability.
Page 54
Fair value hierarchy
The table below analyses financial instruments carried at fair value, by valuation method. The
different levels have been defined as follows:
Level 1:
Level 2:
Leve13:
quoted prices (unadjusted) in active markets for identical assets or liabilities.
inputs other than quoted prices included within Level 1 that are observable for
the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived
from prices).
inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
Level 2
31 March 2011
31 March 2010
1,993,912,795
1,808,440,312
There has been no transfer of the Company's financial assets at fair value through profit or loss
to/from other levels during the year.
26Contingent liabilities
There is an unsecured contingent liability in respect of death benefits under the terms of the
collective agreements made with certain categories of employees. The maximum benefits to
which those categories of employees may be entitled in respect of services already completed
based on current salaries is approximately $547,523 (2010: $529,722).
27Critical accounting estimates and judgements
Estimates and judgements are continually evaluated and are based on historical experience and
other factors, including expectations of future events that are believed to be reasonable under
the circumstances.
Critical accounting estimates and assumptions
The Group makes estimates and assumptions concerning the future. The resulting accounting
estimates will, by definition, seldom equal the related actual results. 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:
Estimated impairment of non-financial assets
Goodwill is tested for impairment annually and whenever there is indication that the goodwill
may be impaired. Intangible assets, property, plant and equipment and investments in
subsidiaries are tested for impairment whenever there is any objective evidence or indication
that these assets may be impaired.
Page 55
Income taxes
Significant judgement is required in determining the capital allowances and deductibility of
certain expenses during the estimation of the provision of income taxes. There are many
transactions and calculations for which the ultimate tax determination is uncertain during the
ordinary course of business. The Group recognises liabilities for anticipated tax audit issues
based on estimates of whether additional taxes will be due. Where the final tax outcome of
these matters is different from the amounts that were initially recorded, such differences will
impact the income tax and deferred tax provisions in the period in which such determination is
made.
28Comparative information
Certain comparatives in the statements of comprehensive income have been reclassified to be
consistent with the current year presentation. The reclassifications did not have any material
impact on the presentation of the financial statements.
29New accounting standards and interpretations not yet adopted
Below are the mandatory standards, amendments and interpretations to existing standards that
have been published, for the Group's accounting period beginning on or after 1 April 2011 or
later periods and which the Group has not early adopted:
Amendment to SB-FRS 101 Limited Exemption from Comparative SB-FRS 107
Disclosures for First-time Adopters
Amendments to TNT SB-FRS 113 Amendments Relating to the Fair Value of Award
Credits
Amendments to SB-FRS 108 (2010) Operating Segments
Amendments to INT SB-FRS 114 Amendments Relating to the Prepayments of a
Minimum Funding Requirement
TNT SB-FRS 119 Extinguishing Financial Liabilities with Equity Instruments
Improvements to SB-FRSs 2010
The Group anticipates that the adoption of the above SB-FRSs, TNT SB-FRS, amendments and
improvements to SB-FRS in the future periods will not have a material impact on the financial
statements of the Group in the period of their initial adoption.
Page 56

singapore totalisator board annual report 2011

Transcription

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