The Corporation is a body corporate established pursuant to the Adelaide Festival Corporation Act 1998. The Corporation is an instrumentality of the Crown. The functions of the Corporation, as set out by section 5 of the Act, are to:
conduct in Adelaide and other parts of the State the multifaceted arts event that is known as the Adelaide Festival of Arts;
continue to further develop the Adelaide Festival of Arts as an event of international standing and excellence;
conduct or promote other events and activities;
provide advisory, consultative, managerial and support services within areas of the Corporation’s expertise;
undertake other activities that promote the arts or public interest in the arts, or that otherwise involve appropriate use of its resources;
carry out such other functions assigned to the Corporation by or under this or any other Act, or by the Minister.
The Board of the Corporation consists of eight members appointed by the Governor and includes a representative from each of the Friends of the Adelaide Festival Incorporated and the Corporation of the City of Adelaide. The Board is subject to the control and direction of the Minister except in relation to the artistic content of an event or activity conducted by the Corporation and the manner for dealing with a testamentary or other gift.
The Adelaide Festival of Arts is a biennial event with 2000 being a Festival year.
The Corporation incurred an Operating Deficit for the year of $1.8 million. However, as explained later under the heading ‘Interpretation and Analysis of Financial Statements’ over the two-financial-year cycle for the 2000 Festival and other projects, the result was an Operating Deficit of $205 000.
The Auditor-General audits the accounts of the Adelaide Festival Corporation pursuant to subsection 19(3) of the Adelaide Festival Corporation Act 1998.
The audit program covered all major financial systems and was directed primarily towards obtaining sufficient evidence to enable an audit opinion to be formed with respect to the financial statements and internal control.
During 1999-2000 specific areas of audit attention included:
revenue, including cash receipting and debtors
expenditure, including accounts payable and salaries and wages
contracts
budgetary control.
An audit management letter conveying the scope of the audit and related findings was forwarded to the Chief Executive Officer of the Corporation. A satisfactory response was received to the matters raised.
The overall internal control environment was assessed as satisfactory.
As required by subsection 36(1)(a)(iii) of the Public Finance and Audit Act 1987, the audit of the Adelaide Festival Corporation included an assessment of the controls exercised in relation to the receipt, expenditure and investment of money, the acquisition and disposal of property and the incurring of liabilities. The assessment also considered whether those controls were consistent with the prescribed elements of the Financial Management Framework as required by Treasurer’s Instruction 2 ‘Financial Management Policies’.
Audit formed the opinion that the controls exercised by the Adelaide Festival Corporation in relation to the receipt, expenditure and investment of money; the acquisition and disposal of property; and the incurring of liabilities, were sufficient to provide reasonable assurance that the financial transactions of the organisation were conducted properly and in accordance with the law.
The operating result for the year was an Operating Deficit of $1.8 million. In reviewing this result consideration needs to be given to the unique financial operations of the Corporation, which because the biennial nature of the Adelaide Festival of Arts, effectively operates over a two-financial-year cycle. 1999-2000 is the second year of that cycle.
To gain an appreciation of the operation’s of the Corporation over that current two year cycle it is necessary to consider the operating result of the Corporation for the period 1 April 1999 to 30 June 1999, as well as the operating result of its predecessor, the Adelaide Festival Board, for the period 1 July 1998 to 31 March 1999.
The following table highlights the operating result of the Corporation and the former Adelaide Festival Board for the 1998-99 and 1999-2000 financial years which cover the period of operation relating to the conduct of the 2000 Adelaide Festival of Arts and other projects.
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|
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Operating Result |
|
|
|
|
Surplus/(Deficit) |
|
|
|
|
|
$’000 |
Adelaide Festival Board (1 July 1998 - 31 March 1999) |
|
|
|
1 425 |
Adelaide Festival Corporation (1 April 1999 - 30 June 1999) |
|
|
|
208 |
Adelaide Festival Corporation (1 July 1999 - 30 June 2000) |
|
|
|
(1 838) |
|
|
|
|
(205) |
|
|
|
|
|
As can be seen from the foregoing table the overall result of the operation’s of the Corporation for the 2000 Festival cycle just concluded, was an Operating Deficit of $205 000.