MISSION, VISION & VALUES 3 STRATEGIC DIRECTION 4 PRESIDENT’S REPORT 5 - 6 CHIEF EXECUTIVE OFFICER’S REPORT 7 - 9 FINANCIAL REPORTS 10 - 11 KEY PERFORMANCE INDICATORS 12 - 13

CONTENTS

OUR MISSION

OUR VISION

OUR VALUES

“Caring for the seniors in a community environment, providing for their changing needs”

“To be a leader in the provision of seniors’ accommodation and services within the community”

We work together with P R I D E

P rofessionalism R espect and understanding I ntegrity D ignity and compassion E nthusiasm

Evaluate and identify the key components of Amaroo Care Services Inc that are critical to our continued success as they relate to changing market.

OUR STRATEGIC DIRECTION

UNDERSTANDING OUR BUSINESS

SERVICE DELIVERY MODEL Evaluate the Amaroo Care Services Inc service delivery model with a view to improving programmes that are critical to the growth and development of our business.

GROWTH & DEVELOPMENT Based on a clear understanding of our business and the industry in which we work, identify initiatives that enable Amaroo Care Services Inc to grow and develop to meet the demands of our customers with continued viability.

ALLIANCES Evaluate and identify opportunities to form alliances and partnerships with other providers and agencies with the view of contributing to the success of Amaroo Care Services Inc.

BUSINESS COMMUNITY

Maintaining, securing and developing a competent workforce team that is essential to the delivery of a comprehensive range of quality based services.

Identify those systems which are critical to the performance of Amaroo Care Services Inc and either improve or introduce new systems that support and underpin the quality of our service delivery.

WORKFORCE

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This past year has largely been one of planning and consolidation at Amaroo during a period that the WA economy has taken a hit and the Federal Government has been in turmoil with its own financial woes. Generally, this has meant that the property market has been slow to recover meaning that our vacancy rate for Independent Living Units has slightly increased. Furthermore the ability to expand aged care industry has been restricted due to inadequate funding and this has impacted upon Amaroo’s plans to redevelop our Buckley Caring Centre. Frustration and impatience. These are two words which best sum up the attitude of the aged care industry over the past two years as the result of a government that lost its way and did not use the opportunities that presented to bring serious reform to Australia’s aged care industry. From workforce to funding, from delivery of care to capital expenditure – so many aspects crucial to the delivery of aged care services to the growing numbers of frail aged have been in limbo and continue to be so. During the year, our Strategic Plan was reviewed and revised to the extent that we now have a new Strategic Directions paper to work from for 2013 – 2016. Coming out of was the primary focus of the Board and management team being associated with the planning and designing of a new residential aged care facility extension at the Buckley Caring Centre that for all intents and purposes will most likely become ‘the operational centre’ for this service.

We are looking at constructing a double storey building providing 72 residential care places, joined to the remaining 18 places that make up the existing Jarrah Wing making up 90 places for the ‘new’ caring centre. This will essentially provide a very attractive, operationally efficient designed home with a new kitchen, laundry and other needed amenities. Our challenge is of course finding a way to finance this $15M project. The Board, being mindful of the need to upgrade the Gosnells village community amenity have continued to support the design plans and site proposed for a new clubhouse and administration centre, have temporarily deferred this until the Buckley Caring Centre redevelopment has progressed. During April, the Board together with management and staff visited the Denmark and Albany villages where they held meetings with residents, conducted the April monthly meeting and celebrated the official opening of the Albany village. The opening featured an ‘Open Day’ with various features such as a gopher race at the village. At the time, three of the villas were occupied and another was ‘sold’ over that weekend. Through the year, the Board welcomed one new Director, Bob Gadsdon who has been valuable as an architect with his involvement in the Buckley Caring Centre redevelopment. We also fare-welled Amelia Yam. Other Directors on the Board at June 30th were: Tony Italiano, Janice Ricks, David Fleming, Tony Taylor, Lynnette Burris, Steve Tilbrook, and Tony Ciallella.

PRESIDENT’S REPORT

“ ” Steady Growth over a Decade

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I do believe that Amaroo Care Services Inc has a diverse mix of skills and experience to govern the organization, providing direction and support to a very capable and proven executive management team under CEO David Fenwick’s leadership. Three directors, namely Lynnette Burris, Steve Tilbrook and Tony Ciallella joined CEO and managers Linda Lawson and Shelley Harris to attend a national aged care conference held in Queensland during 2012. Lyn Burris and Tony Ciallella also attended a Steve Bowman workshop during the year to update their knowledge on governance for NFP organizations. Ongoing education and development is both offered to directors and expected of them so that as a Board, each director is well informed. One of the great strengths of Amaroo is our people. Our dedicated staff made a very valuable contribution to the success of Amaroo, with many of them providing support beyond their paid work. I would also like to acknowledge those who contribute in a voluntary capacity to the organization for they are a very special group of 130 volunteers whom we value highly. Amaroo’s patron, His Excellency, Malcolm McCusker AO, QC, the Governor of WA and his wife Tonya visited Amaroo on two occasions through the year; once at Gosnells and another time at Albany. My sincere thanks to my Director colleagues for their ongoing commitment and valuable input in a voluntary

capacity. I would like to also express the Board’s appreciation to the CEO, David Fenwick for managing the organization and advocating on behalf of Amaroo’s residents. In closing, I believe Amaroo Care Services Inc is well prepared to meet the challenges of the future.

Norm Smith President

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What is it that Amaroo does so well? Clearly, Amaroo Care Services Inc exists to provide care and support for older people through a range of affordable accommodation options and social activities including quality community and residential care. Our residents and staff remain our primary focus. During March 2012, the Gillard Government released the Productivity Commission’s Report on ‚Caring for Older Australians‛ which had taken some 18 months to develop. Essentially the report contained a hopeful and sustainable future for aged care consumers and providers alike as it pointed the way towards consumer entitlement with the market forces of demand and supply largely replacing the outlived rationed model of place allocation. With this also came the possibility of some much needed deregulation. All this promise was so short-lived when the Minister for Ageing, Mark Butler, assisted by the bureaucrats of the Department of Health & Ageing ‘cherry-picked’ just several recommendations. During May 2012, he announced a new Australian Government aged care reform package to be known as ‚Living Longer, Living Better‛ which identified some $3.77Bn as new money for aged care over the next 4 years, however when analysed more closely it was established that there was only $577Mn that was actually new money, the remaining being rebadged programs.

It even gets better. Imagine that your shoes are nearly worn out and you hear that you are going to get a new pair of shoes, so you get all excited when you see the shoe box of your favourite shoe brand but when you open up the lid you are bitterly disappointed when all you see is a photo of the shoes you were expecting with a note on it saying if you comply with the criteria you will receive them in 2014. What a let-down? Yes, most of the new money is out of reach until 2014. There is little doubt that Australia’s ageing population is resulting in the rapid transformation of the aged care and retirement living landscape with the first of the ‘baby boomers’ now reaching the official retirement age of 65 years. The demand for an assortment of quality aged care services is only going to grow as our population ages and yet Government policy and planning to meet these demands continues to lag way behind. Clearly, the Gillard Government has lost its way and has failed to address the issues threatening the aged care industry, especially in WA where the building of any new residential care facilities largely ceased some 4 years ago. Market forces of supply and demand together with a shift towards a larger range of accommodation and care models from changing consumer expectations will see an important paradigm shift for both future retirement

CHIEF EXECUTIVE OFFICER’S REPORT

“ ” Looking back, looking forward

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living and aged care services. Ours is a very complex industry. Across the nation, there is growing concern, and mounting evidence that achieving financial sustainability is now becoming more of an aspiration than a reality. Increasing numbers of organizations similar to Amaroo, many of them larger are reporting losses. Notwithstanding, both the AV Buckley and McMahon Caring Centres have remained at 98.8% for the 173 residential care places over the past year. We do not have empty beds to worry about with our managed waiting lists. On a brighter note, 2011-12 saw Amaroo commence our community care service with 20 CACPs. While available to any qualified frail aged person living within the South East Metro Region of Perth, most of our 14 clients actually lived in Amaroo Village. What this means is that Amaroo can assist our frailer village residents remain in their homes longer with needed support. Not yet economically viable with just 20 CACPs, this is recognised as a significant area to be found in to offer a wider range of care options. A slow recovery after the property market downturn certainly slowed our planned ILU construction at Gosnells, Denmark and Albany. During the year construction was completed on five new 2 bedroom villas on Stalker Road and another eight 3 and 2 bedroom villas at Astley Street in Gosnells, and seven of the nine 2 and 3 bedroom villas of Stage One at our new Albany village. Turnover of the existing 335 ILUs at Gosnells and Denmark remained buoyant with some 59 new residents (46 Units) coming into the village during the year. During the year, by agreement with the WA Department of Housing, Amaroo as a local ‘preferred provider’ took over the management of Lionsville – Denmark, a village

located next door and comprising some twenty-six 1 and 2 bedroom rental villas. In the coming year we expect that we will sign a lease to officially become the custodian and manager of this village. Meanwhile Amaroo has undertaken to purchase an adjoining tract of land by agreement with the Denmark Shire Council once it has been cleaned up. This will accommodate a new clubhouse and another twenty-four villas for the future. Significant achievements at year end include:

A balanced budget during a recession; A stabilized work force with both low

turnover and few vacancies; An extemporary resident satisfaction survey

return; Another 3 years accreditation for Buckley

Caring Centre; A new Strategic & Business Plan for 2011 –

2014 A schematic concept plan to redevelop the

Buckley Caring Centre A design plan to build a new clubhouse

and administrative building Renewed ‘employee-attractive’ but ‘employer

-affordable’ enterprise bargaining agreements for most of our employees.

The leasing out of the former Gosnells

Family Hospital and the Lewis Homestead to other not-for-profit local organizations.

For the coming year, there are plans to:

Construct 6 x 2 bedroom villas on Stalker Road, Gosnells;

Advance the plans to redevelop the

Buckley Caring Centre precinct;

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Advance the plans to build a new clubhouse and administrative building;

Undertake the site-works and infrastructure

for Stage 2 comprising of seven villas at Albany.

As a post script to the aged care reform debacle, the industry was then informed during June 2012 of a modification to the Aged Care Funding Instrument (ACFI) effective from 1st July 2012, together with a decision to withhold the price indexation during 2012-13 to reduce expenditure by $480M. In fact this funding claw-back amounts to $1.6Bn over the next three years. So what does this mean for Amaroo? Briefly it represents a 4% or $200K reduction in revenue at our residential caring centres in the coming year. We are actively looking at ways that we can recover this shortfall. ACKNOWLEDGING OUR QUIET ACHIEVERS Thanks are expressed to our volunteers whose support continues to be invaluable in maintaining a quality of life for residents and clients. If we had to pay our volunteers we would have to find an additional $260,000 so there is no doubt this special group of people make a valuable contribution to Amaroo Care Services Inc. We have continued to work with the Amaroo Village Resident’s Advisory Committee to ensure that we maintain high service standards and where possible enhance the village’s lifestyle appeal to our valued residents. Finally, I would like to acknowledge the Board for their support, and the managers and staff for their outstanding commitment to achieving the best outcomes we possibly can for our present and future residents and clients. I am very appreciative of Amaroo’s staff and commend them for their tireless contributions and valued team work.

We can be proud of our organization and its accomplishments, however our future success will depend upon new ways of thinking, radical redesign, passionate determination, collaborations and partnerships, and generally ‘working smarter’.

David Fenwick Chief Executive Officer

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FINANCIAL REPORTS

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We have audited the accompanying financial report of Amaroo Care Services (Inc), which comprises the Statement of Financial Position as at 30 June 2013, and the Statement of Comprehensive Income, Statement of Changes in Equity and Statement of Cash Flows for the year then ended, a summary of significant accounting policies, other explanatory notes and the directors’ declaration. BOARD OF DIRECTORS’ RESPONSIBILITY

FOR THE FINANCIAL REPORT The Board of Directors are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australia Accounting Interpretations), the Associations Incorporation Act 1987 of WA and the requirements of the Department of Health and Ageing. The Board of Directors’ responsibility also includes such internal control as the Board determine necessary to enable the preparation of a financial report that gives a true and fair view and is free from material misstatement, whether due to fraud or error.

AUDITOR’S RESPONSIBILITY

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the financial report, 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 report 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 Board of Directors, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. INDEPENDENCE In conducting our audit, we followed applicable independence requirements of Australian professional accounting bodies. AUDITOR’S OPINION In our opinion, the financial report of Amaroo Care Service (Inc): i) gives a true and fair view of the financial position

of the association as at 30 June 2013 and of its financial performance for the year ended on that date; and

ii) complies with the Australian Accounting

Standards and the Associations Incorporation Act 1987 of WA

MACRI PARTNERS Certified Practising Accountants

A MACRI Registered Company Auditor R/N: 14034

INDEPENDENT AUDIT REPORT TO THE MEMBERS OF AMAROO CARE (INC)

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KEY PERFORMANCE INDICATORS

2003/2004

2004/2005

2005/2006

2006/2007

2007/2008

2008/2009

2009/2010

2010/2011

2011/2012

2012/2013

98.7 99.5 99.7 99.4 98.6 99.2 99.2 99.5 99.2 98.6 98.6 99.2 99.1 99.2 98.8 98.7 99.0 98.9 98.1 96.9

96.9 97.6 97.9 98.5 97.7 96.5 96.8 95.0 95.0 97.5

0.0 0.0 0.0 0.0 0.0 66.1 86.2 98.8 92.3 91.4

0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 25.75

McMahon Caring Centre Buckley Caring Centre

Independent Living Units - Gosnells

Independent Living Units - Denmark Independent Living Units - Albany

60.0 65.0 70.0 75.0 80.0 85.0 90.0 95.0 100.0

2003/2004

2004/2005

2005/2006

2006/2007

2007/2008

2008/2009

2009/2010

2010/2011

2011/2012

2012/2013

Year

2003/200

4

2004/200

5

2005/200

6

2006/200

7

2007/200

8

2008/200

9

2009/201

0

2010/201

1

2011/201

2

2012/201

3

McMahon Caring Centre 98.7 99.5 99.7 99.4 98.6 99.2 99.2 99.5 99.2 98.6

Buckley Caring Centre 98.6 99.2 99.1 99.2 98.8 98.7 99.0 98.9 98.1 96.9

Independent Living Units - Gosnells 96.9 97.6 97.9 98.5 97.7 96.5 96.8 95.0 95.0 97.5

Independent Living Units - Denmark 0.0 0.0 0.0 0.0 0.0 66.1 86.2 98.8 92.3 91.4

Independent Living Units - Albany 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 0.0 25.75

Occupancy Rates for Independent Living Units and Caring Centres

Occupancy Rates for Independent Living Units and Caring Centres

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amaroovillage.com.au

AMAROO VILLAGE GOSNELLS 2 Wreford Court Gosnells 6110 PERTH WA P: 9490 3899 F: 9398 4923

AMAROO VILLAGE DENMARK 12 Hardy Street Denmark 6333 WA P: 0427 851 562 F: 9848 2564

AMAROO VILLAGE ALBANY 63 Pioneer Road Albany 6330 WA P: 0408 793 173

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