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Copie de tnz annual report 2008 - 2009

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					                                               G25



Tourism new zealand
annual rePorT 2008–2009




 new zealand Has manaGed To
             world s
 CaPTure THe world’s
     ina
     inaTion
 imaGinaTion
           onsisTenT
 wiTH iTs ConsisTenT

  randinG
 BrandinG
 — uniTed naTions world Tourism orGanizaTion
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     PURE AS
                                           This year the 100% Pure New Zealand              Accolades for its clarity, flexibility and
                                           campaign is 10 years young. It is one of         authenticity have flooded in from the
                                           the longest-running global campaigns             international tourism industry, branding
                                           and has been seen all over the world             experts and potential visitors alike.
                                           by millions of people.                           Here are a few highlights of the
                                                                                            campaign over the last decade.
                                                                                                         G25




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     LAUN 08                NEW ZEALAND
       FEB
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                            SINGAPORE              THANKS A
                                                  MILLION OZ
                                              W                  WHAT’S ON
INDIA                                     SHO
                                     DAY OM NZ
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                                   LIvE            NEW ZEALAND                 ASSU PURE
                                                                                   RANC
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                                                                                   MAKE YOURSELF
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                                                                  GREAT KIWI        (LIONS TOUR)
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            AUSTRALIA                                                                    WI EW Z PU
                                                                                           NT EA RE
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                                                                                                GA ND
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                                                                                                     S




                                                          HOME
2    CoNTeNTs                                                                             // TourIsm ANNuAl rePorT // 2008 – 2009




    CONTENTS
    ABOUT TOURISM NEW ZEALAND               3

    CHAIRMAN’S REPORT                       4

    CHIEF ExECUTIvE’S REPORT                 6

    BOARD MEMBERS                           10

    GOvERNANCE AT TOURISM NEW ZEALAND       11

    MANAGEMENT AT TOURISM NEW ZEALAND       13




    STATEMENT OF SERvICE PERFORMANCE        15   NOTES TO THE FINANCIAL STATEMENTS                                         29
                                                 Note 1    StatemeNt of accouNtiNg policieS                                29
       campaigN                             17
                                                 Note 2    crowN reveNue                                                   33
       chaNNel                              21   Note 3    other reveNue                                                   33

       capability                           22   Note 4    foreigN exchaNge gaiNS                                          34
                                                 Note 5    other expeNSeS                                                  34
    MANAGEMENT STATEMENTS                   23
                                                 Note 6    foreigN exchaNge loSSeS                                         35
                                                 Note 7    total expeNditure of pareNt                                     35
                                                 Note 8    SubSidiary compaNieS                                            35
    FINANCIAL STATEMENTS                    26
                                                 Note 9    aSSociate compaNy                                               37
       StatemeNt of reSpoNSibility          26
                                                 Note 10   caSh                                                            37
       StatemeNt of fiNaNcial performaNce   27   Note 11   receivableS                                                     38
                                                 Note 12   derivative fiNaNcial iNStrumeNtS                                39
       StatemeNt of fiNaNcial poSitioN      28
                                                 Note 13   property plaNt aNd equipmeNt                                    40
       StatemeNt of chaNgeS iN equity       28   Note 14   accommodatioN boNdS                                             41

       StatemeNt of caSh flowS              29   Note 15   creditorS aNd other payableS                                    41
                                                 Note 16   employee eNtitlemeNtS                                           41
                                                 Note 17   proviSioNS                                                      41
                                                 Note 18   recoNciliatioN of SurpluS (deficit)
                                                           to Net caSh from operatiNg activitieS                           42
                                                 Note 19   coNtiNgeNt liabilitieS aNd coNtiNgeNt aSSetS                    42
                                                 Note 20   iNcome tax                                                      42
                                                 Note 21   maNagemeNt of riSk                                              43
                                                 Note 22   SigNificaNt accouNtiNg judgemeNtS,
                                                           eStimateS aNd aSSumptioNS                                       43
                                                 Note 23   capital maNagemeNt                                              43
                                                 Note 24   categorieS of fiNaNcial aSSetS aNd liabilitieS                  44
                                                 Note 25   capital commitmeNtS                                             44
                                                 Note 26   operatiNg commitmeNtS                                           45
                                                 Note 27   related party traNSactioNS                                      45
                                                 Note 28   fiNaNcial iNStrumeNt riSkS                                      47
                                                 Note 29   remuNeratioN of employeeS                                       48
                                                 Note 30   remuNeratioN of board memberS                                   49

                                                 FIvE-YEAR FINANCIAL SUMMARY OF PARENT                                     50

                                                 AUDIT REPORT                                                              51
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                       AbouT TourIsm New ZeAlANd      3




IT IS AN ExCITING AND CHALLENGING ROLE IN A
FAST-MOvING INDUSTRY
WHICH IS INCREASINGLY
COMPETITIvE,
QUICK TO ADOPT CHANGE
AND REGULARLY FACES MAJOR CHALLENGES.


ABOUT TOURISM NEW ZEALAND                       awareness and preference for New Zealand       To ensure visitors go home happy and tell
                                                as a holiday destination among our target      others to visit is one of the most important
Tourism New Zealand was established to
                                                market of potential visitors. we also work     marketing tools New Zealand has. The
market New Zealand as a visitor destination
                                                with the industry to convert that preference   organisation works with its subsidiaries,
overseas for the long-term benefit of
                                                into a visit.                                  Qualmark and i-sITe New Zealand, to ensure
New Zealand.
                                                                                               that once here, visitors have access to good
                                                The most easily recognisable area of our
It is an exciting and challenging role in a                                                    information and local knowledge, quality
                                                work is with the 100% Pure New Zealand
fast-moving industry which is increasingly                                                     accommodation, activities and transport.
                                                campaign that appears in print, on
competitive, quick to adopt change and
                                                television, the internet, in cinemas and on    To find out what visitors think about their
regularly faces major challenges.
                                                outdoor advertising. Tourism New Zealand’s     time here and their satisfaction levels,
In 2008, 922 million tourists travelled         International Public relations and             Tourism New Zealand has an ongoing,
worldwide up 2 per cent on 2007.                International media Programmes work in         in-depth research programme.
However, growth in the first half of the        tandem with the campaign to promote
                                                                                               Tourism New Zealand also takes a
year was clearly impacted by the global         New Zealand through events, public
                                                                                               leadership stance in areas like
economic downturn which took worldwide          relations activity and international
                                                                                               environmental best practice and Mäori
international travel into negative growth       media relations.
                                                                                               cultural awareness. Through its Qualmark
territory in the second half of the year.
                                                much of the work to convert a potential        subsidiary, Tourism New Zealand has
New Zealand sees just a tiny proportion         visitor’s desire to travel to New Zealand      introduced more rigorous environmental
of that huge international tourism market.      into actually making the trip is done          requirements for accredited businesses.
In the year to June 2009, 2.4 million           through Tourism New Zealand’s nine             Tourism New Zealand also works with
international visitors arrived in New Zealand   offshore offices. staff work with the          tourism businesses and regions to help
and spent $6 billion dollars excluding          travel trade to help develop new ideas         develop Mäori capability and awareness.
airfare receipts.                               for itineraries, promote new products
                                                                                               Tourism New Zealand is committed
                                                and train front line sales staff so they
To keep New Zealand in the spotlight                                                           to improving its own environmental
                                                know more about New Zealand and
among our potential visitors, Tourism                                                          performance and this year earned
                                                can sell it more effectively.
New Zealand’s work offshore aims to build                                                      a Qualmark enviro-bronze rating.
4       CHAIrmAN’s rePorT                                                                                 // TourIsm ANNuAl rePorT // 2008 – 2009




    “
    WE MUST CONTINUE TO INCREASE
    AWARENESS OF
    NEW ZEALAND BY MAKING OUR ADvERTISING

    COMPELLING
                    BY REACHING PEOPLE
    AND




                    THROUGH vARIED CHANNELS.”

                             CHAIRMAN’S REPORT
                             GreG muIr, CHAIrmAN, TourIsm New ZeAlANd



    THE YEAR IN REvIEW                             specific awareness of the 100% Pure              in may and June 2009. As a result of the
                                                   New Zealand campaign has increased               campaign, Air New Zealand reported
    2008/9 has been a challenge for Tourism
                                                   in the majority of our key markets and           trans-Tasman bookings for may and June
    New Zealand and the tourism industry as
                                                   remains strong despite increased and             travel were up 50 per cent, while domestic
    the global financial crisis and Influenza
                                                   intense competition from other destinations.     flight booking add-ons increased by
    A (H1N1) (Swine Flu) took their toll on
                                                                                                    132 per cent.
    worldwide visitor numbers from the latter      Tourism New Zealand has used the
    half of 2008/2009.                             downturn as an opportunity to look at where      over 15,000 additional visitors arrived in
                                                   it operates, how it operates and how it can      New Zealand from Australia in may and
    worldwide international visitor arrivals to
                                                   operate faster and more effectively in an        June, compared with the same months
    december 2008 were up 2 per cent, but in
                                                   increasingly volatile environment.               last year, a major contribution to a
    the first four months of 2009 that picture
                                                                                                    better-than-expected performance
    changed rapidly with international arrivals    An example of this was Tourism
                                                                                                    over the winter season.
    down 8 per cent on the previous year.          New Zealand’s increased focus on the
                                                   important Australian market to sustain the       The additional funds meant Tourism
    by comparison New Zealand’s arrivals held
                                                   industry through this slower arrivals period.    New Zealand was also able to work with
    up well, with 2.4 million international
                                                                                                    Australia’s Today breakfast news show,
    visitors in the year to June, a 2.8 per cent   A successful bid for an additional $2.5
                                                                                                    which broadcast live from New Zealand
    drop on the previous year. Visitor spend       million of Government funding enabled
                                                                                                    for seven days in June. The programme
    has also been maintained, overall visitor      Tourism New Zealand to maintain its
                                                                                                    achieved its highest ratings in seven years
    spending was down 2.6 per cent in the          Australian campaign over summer and
                                                                                                    and contributed to a 56 per cent increase
    June 2009 year compared with 2008.             spring. It also resulted in a successful joint
                                                                                                    in traffic to Tourism New Zealand’s
                                                   venture project with Air New Zealand,
    Awareness levels of New Zealand as a                                                            consumer website, www.newzealand.com.
                                                   aligning Tourism New Zealand’s marketing
    travel destination have, on average,
                                                   efforts with an Air New Zealand promotion
    been maintained at 2007/08 levels.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                CHAIrmAN’s rePorT     5




  In May 2009, New Zealand welcomed one million
  Australian visitors in a calander year for the first time ever.
  We celebrated with the ‘Thanks a Million Oz’ promotion.




                                                                It is also important that New Zealand          successful and at the 10 year mark it is the
                                                                delivers a high-class visitor experience to    envy of many tourism marketing bodies
                                                                ensure that visitors go home satisfied and     worldwide. It regularly wins awards and in
                                                                recommend New Zealand to their friends,        the last year our new global campaign won
                                                                families and colleagues.                       the PATA gold award for the 100% Pure
                                                                                                               “Youngest Country” campaign launched
                                                                To do this, we want to want to increase
                                                                                                               in 2007.
                                                                the profile of the Qualmark quality rating
                                                                system and i-sITe visitor information          George has led Tourism New Zealand
                                                                network. A focus on quality will help ensure   with a clear and steady focus, embracing
                                                                a high-level of economic return from           innovation, creativity and teamwork.
                                                                tourism to the New Zealand economy.            I wish him well in the future.


Tourism New Zealand ran ‘What’s On’ over summer
                                                                THANKS
in Australia for the first time.                                I would like to thank Tourism New Zealand’s
                                                                Chief executive George Hickton for his
FUTURE FOCUS                                                    contribution to the organisation over
Tourism New Zealand’s priorities for                            the last decade.
the coming year remain focused on                               George arrived at Tourism New Zealand          Greg Muir
encouraging more visitors to come now,                          when it required strong leadership and         Chairman, Tourism New Zealand
stay longer and spend more. To do that we                       a clear vision to unite the Government,
need to stimulate peak arrivals through                         industry and staff behind the organisation
carefully timed, appealing marketing.                           and a single country brand.
we must continue to increase awareness of                       He has overseen the introduction and
New Zealand by making our advertising                           development of the 100% Pure
compelling and by reaching people through                       New Zealand brand and evolution of that
varied channels. we will also continue to work                  brand to suit individual markets, including
with the industry to make sure that a trip to                   Australia, the us and uK. The 100% Pure
New Zealand is easy to plan and book.                           New Zealand brand has been extremely
6     CHIef exeCuTIVe’s rePorT                                                                           // TourIsm ANNuAl rePorT // 2008 – 2009




    “THE ORGANISATION IS
              E,
     INNOvATIvE,
     MOvES QUICKLY AND MAKES THINGS HAPPEN
     IN A WAY THAT CONTINUES
     TO SURPRISE ME”
                                 CHIEF ExECUTIvE’S REPORT
                                 GeorGe HICKToN, CHIef exeCuTIVe, TourIsm New ZeAlANd




     100% PURE NEW ZEALAND                                                  OvERvIEW 2008/9
     This year New Zealand’s 100% Pure New Zealand brand                    during the year, Tourism New Zealand and the tourism industry
     celebrated its 10th anniversary, giving the tourism industry           faced two major shocks. In late 2008, the global financial crisis
     an opportunity to look back at some of the major milestones            took its toll on visitor numbers. Influenza A (H1N1) (swine flu)
     achieved over the last decade.                                         then impacted on arrivals, particularly from Asia. In may and June
                                                                            2009, strict quarantine requirements in China caused
     over that time, New Zealand has seen international visitor arrivals    cancellations and postponements of total outbound travel to rise
     rise by over two-thirds to 2.4 million and spending increase by        by 30-50 per cent and many Japanese schools cancelled trips
     50 per cent to $6 billion. If you include airfare sales that figure    planned for August.
     rises to $8.8 billion and accounts for 18 per cent of New Zealand’s
                                                                            The year also saw a major shift in consumer behaviour. Tourists are
     total export earnings.
                                                                            booking later, making it harder for businesses to plan ahead.
     many factors have contributed to that growth, but having               Travellers are also more focused on finding the best deals and
     a single, strong global brand – 100% Pure New Zealand –                increasing their use of the internet to find them.
     has certainly helped.
                                                                            with the added incentive of cheap online ticket deals, I believe
     It has allowed Tourism New Zealand to focus its attention on           a tipping point has now been reached where travellers are
     raising awareness of New Zealand as a visitor destination. It          more likely than ever to use the internet to research and book
     has allowed us to put our energy and time into exploring new           international travel. This is something the industry as a whole
     opportunities and into finding creative and innovative ways to build   will have to adapt to.
     New Zealand’s profile. That single focus has also helped the           However, the year also provided a number of positives.
     industry to work with us to support the brand, both through their      Airlines entered a heavy discounting period resulting in record
     own marketing and by delivering a high-quality experience which        low ticket prices, stronger foreign currency exchange rates made
     sends 90 per cent of visitors home highly satisfied with their         New Zealand more affordable for visitors from some markets and
     New Zealand experience.                                                jet fuel prices reduced.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                                                                   CHIef exeCuTIVe’s rePorT            7




for Tourism New Zealand these combined                                     HOLIDAY ARRIvALS 1999–2009
factors meant a review of our markets and
                                                                             1,300,000
some quick, but tough, decisions about
budget allocation; decisions that helped
                                                                             1,200,000
deliver a smaller than expected decline in
arrivals over the key summer months




                                                 holiday arrivalS
between November and April.                                                  1,000,000



CONSUMER MARKETING                                                            900,000

AND ONLINE
The diversity of work undertaken by the                                       750,000




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year, with traditional and online marketing
initiatives. In August 2008, we launched
the “what do You say uK?” campaign,                                        INTERNATIONAL vISITOR ExPENDITURE 1999–2009
allowing british travellers to talk directly                                       7.0
to each other about their time in
New Zealand. In february, we launched                                              6.0
the “lifeback Promise” campaign in the
                                                 expeNditure NZ$billioNS




us. This campaign was linked closely with
                                                                                   5.5
the us travel trade and to a media
partnership with the discovery Channel. In
January, we became the first tourism board                                         4.5

to take a mobile film recording studio on
the road to capture people’s own holiday                                          3.75
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their friends and family at home. we then
used our Australian “what’s on” campaign
to partner with Air New Zealand to promote                                 NEWZEALAND.COM USER SESSIONS 1999–2009
travel to New Zealand in may and June.                                      15,000,000
This helped New Zealand reach the major
milestone of welcoming a million                                            11,250,000
Australians in a calendar year, something
we celebrated with the “Thanks a million”
                                                 uSer SeSSioNS




                                                                             7,500,000
promotion in may.

Tourism New Zealand’s consumer website                                       3,750,000
continued to show great results, with user
sessions up 44 per cent on the previous
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traffic. directly after the final phase of                                           Note: figures pre: 2001/2 relate to user sessions on purenz.com


brand campaign on 9 february 2009,
weekly user sessions rose by over 2000
per cent from the week before, and
                                                     seeds story ideas and images for use by                                                                 work with the Indian cricket team and
reached a record high of 418,772 weekly
                                                     international media – is an invaluable tool                                                             high-profile Indian guests during the 2009
user sessions in any one week.
                                                     for gaining exposure for New Zealand and                                                                Indian cricket tour resulted in footage and
                                                     user sessions increased by more than
INTERNATIONAL PUBLIC                                                                                                                                         images of New Zealand reaching an
                                                     130,000 over the year.
RELATIONS                                                                                                                                                    estimated 160 million people in one of
                                                     Two big media projects this financial                                                                   New Zealand’s most important developing
This year has seen Tourism New Zealand
                                                     year involved working with the us reality                                                               markets.
increase our focus on using public relations
(Pr) to promote New Zealand in a                     dating show The Bachelor and Australia’s
                                                                                                                                                             other projects included working with uK
cost-effective way. Coverage reached                 Today show.
                                                                                                                                                             broadcaster, actor and comedian stephen
millions of potential visitors through events,       The Bachelor was watched by almost                                                                      fry, television celebrity Jack osbourne,
our International media and opinion                  93 million across seven episodes aired                                                                  American footballer dhani Jones, and
leaders’ programmes and the Global                   in the usA and Canada, with another                                                                     Japanese actress beverley maeda.
Newsroom, which allows staff from around             26 million reading associated online stories.
the world to share story ideas. we have              The Today show had not broadcast from                                                                   In total, 585 media and opinion leaders
broadened our Pr activity to include the             outside Australia since 2005 and                                                                        were hosted this year, with the results
creation of our own video content. The               New Zealand coverage reached an                                                                         reaching an estimated audience of around
team’s international media website – which           audience of 3.5 million.                                                                                1.5 billion.
8    CHIef exeCuTIVe’s rePorT                                                                               // TourIsm ANNuAl rePorT // 2008 – 2009




                                                                                                     Far left: Australia’s Today show broadcast
                                                                                                     live from New Zealand reaching 3.5 million
                                                                                                     viewers over seven days.




                                                                                                     Left: Almost 93 million viewers in the US
                                                                                                     and Canada tuned in to watch the Bachelor
                                                                                                     in New Zealand.




    EvENTS                                           between New Zealand’s giant kauri tree          TRADE MARKETING
                                                     Tane mahuta and Jōmon sugi, a similar forest
    events offer the opportunity to profile                                                          Trade marketing provides the link
                                                     chief on Japan’s Yakushima Island. Three
    New Zealand and the 100% Pure                                                                    between the brand and the travel industry.
                                                     Japanese newspapers and one television
    New Zealand brand overseas, they also                                                            An educated and effective travel trade is
                                                     crew attended the ceremony in the waipoua
    create news and provide opportunities                                                            invaluable in helping promote New Zealand
                                                     forest, reaching an audience of 15.5 million.
    to host key media in New Zealand.                                                                and encouraging people to translate their
                                                                                                     desire to travel here to actually booking
    The biggest event project for the year was       CORPORATE COMMUNICATIONS                        a trip.
    the installation of the Giant Inflatable rugby   Prime minister John Key’s decision to take
    ball in london in November 2008. The ball        up the tourism portfolio; the rapid approach    To help link Tourism New Zealand with
    was officially opened by mayor of london         of the rugby world Cup in 2011 and more         travel sellers around the world, the team
    boris Johnson and visited by Queen               challenging times facing New Zealand’s          has redeveloped its trade website. The
    elizabeth II. most national daily newspapers     tourism industry has required Tourism           new site has allowed us to reach a wider
    carried coverage of the ball, including the      New Zealand’s corporate communications          audience. Along with offering award-
    Telegraph, Observer and The Times, as            team to increase the frequency and speed        winning trade training modules, the site
    well as international television channels        of its communications. A redevelopment of       also has guidebooks, regional product
    including Sky News and the BBC World.            the corporate site, www.tourismnewzealand.      information, marketing tools, news and
                                                     com, was begun during the year. The team        events. online webinar training has been
    when Tourism New Zealand invited
                                                     also started regular news updates which         rolled out in the uK and europe after a
    broadcaster michael Peschardt to
                                                     are sent directly to the inboxes of about       successful start in the us and Canada.
    New Zealand as an international judge for
    the 20th montana world of wearableArt            6,700 online subscribers. A slimmed-down        during the year, the team hosted 150 travel
    Awards, his profile of creator suzie             hard copy of Tourism News is still produced     sellers on familiarisation trips around
    moncrieff reached a potential audience of        and sent to 4,500 people a quarter, but it      New Zealand, organised Kiwilink North
    78 million people on bbC world. The team         pushes people to ‘read more’ online.            America and the second Tourism
    also hosted 12 media outlets during the          during the year over 5,300 face-to-face         New Zealand Asia Awards, recognising
    louis Vuitton Pacific series and seven           engagements were arranged and facilitated       outstanding product development in Asia.
    international media to the michael Hill          through the communications team.
                                                     members of the team are also meeting            The team also partnered with travel trade
    Golf tournament in march 2009.
                                                     regularly with both national and local          to attend the International luxury Travel
    one of the most interesting events of the year   government in the build up to the               market in Cannes and the world Travel
    was the ceremony to formalise a relationship     rugby world Cup.                                market in london to promote New Zealand
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                   CHIef exeCuTIVe’s rePorT     9




   Tourism New Zealand installed its Giant Rugby Ball
   Venue next to London’s iconic Tower Bridge
   in November 2008.




as a visitor destination and New Zealand                87 members. There are currently 8000           The organisation is innovative, moves
tourism products.                                       operators listed on the site, which will       quickly and makes things happen
                                                        help the network deal with over 10 million     in a way that continues to surprise me.
recognising the importance of the cruise
                                                        visitor contacts each year.
market, a Cruise market development                                                                    The team’s dedication to doing an excellent
manager was appointed during the year                   Tourism New Zealand’s China monitoring         job delivers results that may look effortless,
to work with the cruise industry to develop             unit continues to audit, monitor and           but take huge energy, determination and
that sector.                                            regulate New Zealand’s Approved                commitment. I would also like to thank both
                                                        destination status (Ads) Chinese tour          my current and past boards and Chairs for
DELIvERING QUALITY                                      group operators. This system applies to        their support.
Through our subsidiary interests in the                 all New Zealand inbound tour operators
quality ranking system Qualmark and the                 responsible for managing Chinese Ads
i-sITe visitor information network, Tourism             visitor groups in New Zealand. This year
New Zealand works to influence the quality              the group worked with ATTTo (the Aviation,
of the New Zealand visitor experience.                  Tourism and Travel Training organisation)
                                                        to develop and train the first cohort of
over 2000 businesses now have Qualmark                  Ads-approved guides. The Ads team has
accreditation and during the year a                                                                    George Hickton
                                                        also undertaken numerous audits, mystery
campaign was launched to bring together                                                                Chief executive, Tourism New Zealand
                                                        shopper sessions and spot checks of
the 100% Pure brand and Qualmark                        tour groups.
through the 100% Pure Assurance
message.                                                THANKS
successfully launched in June 2008, over                This is my last report as Chief executive of
240 businesses have now gained a Qualmark               Tourism New Zealand and I would like to
enviro-ranking. Tourism New Zealand has                 thank both my past and current staff for the
gained an enviro-bronze rating this year.               energy and commitment they have brought
                                                        to the organisation. without a doubt it has
meanwhile, the i-sITe team has overseen
                                                        been the most enjoyable and interesting
the redevelopment of the i-sITe extranet
                                                        position I have held.
and the development of a national database
to improve information sharing and best
practice among the i-sITe network’s
10     boArd members                                                                                                             // TourIsm ANNuAl rePorT // 2008 – 2009




     BOARD
     MEMBERS
     GREG MUIR                                                 JOHN BARRETT                                              MALCOLM JOHNS
     Chair                                                     BoarD MeMBer                                              BoarD MeMBer

                         Greg is currently Managing                                 John is Managing Director                               Malcolm is Chief
                         Director of Tru-Test Ltd                                   of Kapiti Island Alive &                                Executive of Intercity
                         and was appointed as                                       Kapiti Nature Lodge,                                    Group (NZ) Limited,
                         Chairman of the                                            a family eco-tourism                                    parent company of
                         New Zealand Tourism                                        operation based on                                      InterCity and Newmans
                         Board in July 2008.                                        Kapiti Island.                                          Coach Lines, Great
                                                                                                                                            Sights, Fullers Bay of
     Prior to joining Tru-Test, Greg was Executive             He is currently Chairman of the
                                                                                                                         Islands, Kings Dolphin Cruises and Eco
     Chairman of Pumpkin Patch Ltd, Chief                      New Zealand Mäori Tourism Council
                                                                                                                         Tours. Malcolm has extensive commercial
     Executive Officer of The Warehouse Group Ltd              and the Wellington Regional Mäori
                                                                                                                         experience having held senior roles with
     and held senior management roles with TNT                 Tourism Organisation, Te Ara a Maui.
                                                                                                                         Discover Canada Holidays, Jasons Travel
     Australia Pty Ltd and Lion Nathan Ltd. He is              He also sits on the Board of Aviation
                                                                                                                         Media, Tourism Holdings and Hyatt
     also a non-executive chairman of Pumpkin                  Tourism & Travel Training Organisation
                                                                                                                         International Hotels and Resorts.
     Patch Limited, Pioneer Capital Management                 (ATTTO) and a number of non-tourism
     Ltd, the Blues S14 Franchise and a director               related organisations.
     of the Auckland Rugby Union.                                                                                        PAUL RICHARDSON
                                                               GLENYS COUGHLAN                                           BoarD MeMBer
     SUSIE JOHNSTONE                                           BoarD MeMBer                                                                  Paul is Vice President
     Deputy Chair                                                                                                                            New Zealand & Fiji
                                                                                  Glenys is a Director of
                                                                                                                                             Accor Hospitality and
                        Susie is a director and                                   The Republic of Acumen
                                                                                                                                             has over 25 years
                        principal of the Chartered                                and has over 20 years
                                                                                                                                             experience in
                        Accountancy firm Shand                                    experience in the tourism
                                                                                                                                             the hospitality and
                        Thomson. She is currently                                 industry, including four
                                                                                                                                             travel industry. After
                        the Deputy Chair of Otago                                 years as Chief Executive
                                                                                                                         10 years working with Starwood Hotels
                        District Health Board and                                 of the Tourism Industry
                                                                                                                         throughout the Asia Pacific region, Paul
                        Southland District Health              Association, eight years in senior
                                                                                                                         joined Accor in 2005 before being
     Board, and a council member of Otago                      management with Air New Zealand and
                                                                                                                         promoted to his current role in 2007.
     Polytechnic. Susie has also held governance               nine years on the board of Te Papa.
                                                                                                                         He is a Director of the New Zealand
     roles on the boards of the New Zealand                    Glenys is currently the Chair of Positively
                                                                                                                         Hotel Council and the Tourism Industry
     Hockey Federation, the New Zealand Blood                  Wellington Tourism and a trustee of the
                                                                                                                         Association.
     Service and the Institute of Chartered                    PATA New Zealand Trust.
     Accountants.

                                                               HENRY vAN ASCH                                            JENNIE LANGLEY
     PAUL BINGHAM                                              BoarD MeMBer
                                                                                                                         BoarD MeMBer
     BoarD MeMBer                                                                                                                           Jennie was appointed
                                                                                  Henry was a co-founder
                                                                                                                                            Independent Chair of
                        Paul is Managing Director                                 of AJ Hackett Bungy
                                                                                                                                            the New Zealand Hotel
                        of Black Cat Group. He is                                 with business partner
                                                                                                                                            Council in 2007, after
                        Chairman of Christchurch                                  AJ Hackett before
                                                                                                                                            four years as Chief
                        and Canterbury Tourism                                    founding Bungy
                                                                                                                                            Executive Officer.
                        and sits on the Air                                       New Zealand in 1997,
                                                                                                                                            She is a director of her
                        New Zealand board. In the                                 where he remains a
                                                                                                                         consultancy company, J L Associates Ltd,
                        past he has been a member              director. Henry oversees ownership and
                                                                                                                         and a member of the Biosecurity
     of the Tourism Research Council New Zealand               operation of the Bungy New Zealand Group
                                                                                                                         Ministerial Advisory Committee. She has
     and the Banks Peninsula Tourism and                       (which includes AJ Hackett Bungy, and
                                                                                                                         previously held board roles at Positively
     Economic Development Board as well as                     Auckland Bungy & Bridge Climb) along
                                                                                                                         Wellington Tourism, the New Zealand Wool
     holding positions with Tourism Holdings Ltd               with his latest ventures: the High Plains
                                                                                                                         Board, Opus International Consultants and
     and Air New Zealand.                                      Wine Co and The Winehouse & Kitchen
                                                                                                                         has acted as a local government councillor
                                                               Restaurant.
                                                                                                                         in the Hawke’s Bay.




     Note: Changes in board members:
     G Muir was appointed Chairman on 15 July 2008. K Guy resigned as a board member on 14 August 2008 and S Murray and K McKelvie’s terms expired 30 March 2009.
     Henry van Asch was appointed as a board member on 1 September 2008 and P Richardson and J Langley were appointed as board members on 10 April 2009.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                GoVerNANCe AT TourIsm New ZeAlANd              11




GOvERNANCE
AT TOURISM
NEW ZEALAND
                                                                                               Above: The ‘What Do You Say UK?’ camaign launched
                                                                                               in the UK in September 2008 allowing Brits to talk to
                                                                                               Brits about their New Zealand experiences.




The New Zealand Tourism Board (trading as       where appropriate, to attend tourism-          There is a direct relationship between
Tourism New Zealand) was established on         related events such as TreNZ, the              the minister of Tourism and the
1 November 1991, as a Crown Entity under        Inbound Tour operators Council                 Chairman of the board. The Chairman
the provisions of the New Zealand Tourism       Conference and other trade and                 has regular meetings with the minister
Board Act 1991. As a Crown Entity, Tourism      industry events.                               to discuss progress and issues facing
New Zealand is expected to comply with the                                                     the tourism industry.
                                                The board has at least six scheduled
appropriate provisions of the Crown Entities
                                                meetings a year including a two-day            As well as this regular communication and
Act 2004.
                                                meeting to review the organisation’s           engagement with its shareholding minister,
The board of Tourism New Zealand,               ongoing strategic direction. As a result of    Tourism New Zealand is aware of the need
including the position of Chairman, is          that meeting, the organisation’s goals are     to engage with the wider community to
appointed by the minister of Tourism.           set and the formal business planning
                                                                                               promote an understanding of tourism
A profile of the current members of             process commenced. Additional board
                                                                                               development and associated issues.
Tourism New Zealand’s board is shown            meetings are scheduled as required.
                                                                                               Tourism New Zealand achieves this through
on page 10. All board members receive
formal letters of appointment from the          under section 92 of the Crown entities         regular meetings with various industry
minister of Tourism setting out their duties,   Act 2004, the board must ensure that           groups, presentations and regional
terms and conditions of appointment             the organisation acts in a manner              meetings as well as through a number
and the expectations of their role.             consistent with the statement of Intent        of external publications, such as
                                                and output Agreement it has negotiated         Tourism News.
The board has a wide range of skills            with the Crown.
in the tourism industry and wider                                                              The board is conscious of its obligations to
commercial environment, which enable            Tourism New Zealand reports quarterly          ensure that board members avoid any
it to deal with the issues arising from the     on its performance against its output          conflicts of interest in their decision-making
role it plays in marketing New Zealand          Agreement. The reports form the basis          process. The board ensures that proper
as a visitor destination.                       of discussion and review by the board          process is followed and that members’
                                                at regular meetings timed to coincide          interests are formally recorded, with any
Tourism New Zealand introduces each
                                                with the required reporting deadlines.
new board member to the organisation                                                           changes or additions being disclosed at the
through an induction process that               unless specifically directed by the minister   start of each meeting. members excuse
includes spending time with each member         of Tourism, the board is the overall and       themselves from any discussions in which
of the executive and his or her respective      final body responsible for all decision-       their duty as a member could be
teams. members are also encouraged,             making within Tourism New Zealand.             compromised.
12    GoVerNANCe AT TourIsm New ZeAlANd                                                                      // TourIsm ANNuAl rePorT // 2008 – 2009




                                                                                                      Above: Entertainer Hinewehi Mohi performed at the
                                                                                                      2008 Tourism New Zealand Asia Awards in Shanghai.


                                                                                                      Left: Tourism New Zealand’s mobile recording studio
                                                                                                      was launched by Prime Minister and Tourism Minister
                                                                                                      John Key, and visited 55 New Zealand towns collecting
                                                                                                      1500 visitors’ stories.




     day-to-day management of the organisation     external audit relationships and                   terms and conditions of a relationship
     has been delegated to the Chief executive     engagements, risk management and                   agreement that meets the criteria
     who is directly accountable to the            financial reporting, including adoption of         determined in frs-37 for consolidating
     board through the Chairman. Tourism           Ifrs reporting standards. following each           investments in subsidiaries) the Visitor
     New Zealand’s delegated Authorities           meeting the chair of the Audit Committee           Information Network Incorporated (VIN
     Policy is set by the board and reviewed       reports back, either verbally or through           Inc), trading as i-sITe New Zealand.
     annually. Appropriate formal processes are    written papers, to the board together with
                                                                                                      Three of Tourism New Zealand’s executive
     in place for reporting back to the board.     appropriate recommendations.
                                                                                                      Team, including the Chief executive, are
     The remuneration Committee meets              Tourism New Zealand manages its risks              directors of Qualmark and one executive
     annually with the Chief executive to review   through a risk management framework; a             member represents Tourism New Zealand
     performance and to establish performance      process that requires it to identify legislative   on the i-sITe New Zealand board. The
     targets for the following year.               and business risks arising from its strategic      board is provided with financial information
                                                   direction and operating environment. risks         from each organisation at each board
     Tourism New Zealand has an audit
                                                   identified are reviewed annually by the            meeting, as well as commentary on
     committee which is comprised of three
                                                   Audit Committee. The Chief executive               performance and significant issues.
     board members who are appointed by
                                                   regularly reports formally to the board on
     the board. The committee is chaired by                                                           Tourism New Zealand expects all of its
                                                   the matter of new or escalated risks and
     susie Johnstone, a chartered accountant;                                                         employees and board members to maintain
                                                   the processes in place to manage these
     other members are malcolm Johns and                                                              the highest ethical standards. Tourism
                                                   appropriately.
     Paul richardson.                                                                                 New Zealand has in place an employee
     sean murray retired as a board member         Tourism New Zealand conducts its own               code of conduct and a formal code of
     and member of the Audit Committee             internal audits, often with the involvement        conduct for its board members.
     during the financial year being reported      of its external auditors. Audits are agreed
     on. In addition, the board has appointed      by the Audit Committee and programmes
     an external member, Gill Cox, a chartered     of work are developed with input by the
     accountant and past president of the          external auditors. The results are reported
     New Zealand Institute of Chartered            back to the Audit Committee.
     Accountants.
                                                   Tourism New Zealand has a controlling
     The Audit Committee meets at least four       interest in two subsidiary companies; a
     times a year. It reviews Tourism              60 per cent shareholding in Qualmark
     New Zealand’s internal control framework,     New Zealand limited; and (through the
// TourIsm ANNuAl rePorT // 2008 – 2009                                                                 mANAGemeNT AT TourIsm New ZeAlANd            13




   MANAGEMENT AT
   TOURISM NEW ZEALAND
   Tourism New Zealand continually reviews       CATHERINE BATES                                    TIM HUNTER
   the markets in which it operates and the
                                                 General ManaGer                                    General ManaGer operations
   extent to which it is involved in those       ConsuMer MarketinG
   markets. As noted on page 3, Tourism                                                             Tim manages Tourism New Zealand’s
   New Zealand currently has nine offshore       Catherine is responsible for leading Tourism       international operations. This involves
   offices.                                      New Zealand’s consumer marketing campaign          overseeing nine offshore offices, coordinating
                                                 through the global 100% Pure New Zealand           project planning for international markets,
   management of offshore activity is achieved   campaign and its merchandising brands in           supporting international trade development
   through a regional structure whereby six      Australia, the UK and the US. She also             work, managing the overseas travel industry
   regional managers report directly to the      oversees the organisation’s online team,           and online training programmes and
                                                 which manages the newzealand.com website,          coordinating trade networking events and
   General manager operations, Tim Hunter.
                                                 and its research team.                             consumer shows.
   Currently regional managers are located in
   london, los Angeles, shanghai, Tokyo,
   sydney and mumbai.                            CAS CARTER                                         KEITH THOMAS
                                                 General ManaGer                                    General ManaGer
   exposure to fluctuations in foreign
                                                 CoMMuniCations                                     Corporate serviCes
   currency exchange rates in these
   countries is achieved through the use         Cas is responsible for Tourism New Zealand’s       Keith is responsible for information
   of foreign exchange instruments. The          internal and external communication.               technology, business planning and
   instruments are matched with anticipated      This role includes liaising with the tourism       accountability documentation and the
                                                 industry, government, media and other              finance and human resources aspects
   future cash flows in foreign currencies.
                                                 stakeholders on tourism industry activities        of the organisation.
   Tourism New Zealand does not use              and issues. Cas is also the GM in charge of
   financial instruments for speculative         Tourism New Zealand’s Rugby World Cup
   purposes.                                     activities.                                        DAvID WILKS
                                                                                                    General ManGer
   The board is kept appraised of offshore                                                          tourisM DevelopMent
   activity at each board meeting through a      JANE DENT
   report by the General manager operations      General ManaGer                                    David is responsible for the organisation’s
   detailing activity by market.                 international puBliC relations                     subsidiary commitments; i-SITE
                                                                                                    New Zealand and Qualmark. Both help
                                                 Jane’s role is to guide the organisation’s         deliver on the promise that New Zealand is a
                                                 overall public relations efforts to maximise the   high-quality destination. David is Executive
                                                 global brand campaign. Tourism New Zealand         Manager of i-SITE New Zealand and Chair
                                                 uses international media, opinion leaders and      of Qualmark. He also oversees the Mäori
                                                 events both on and offshore to reach its target    Development team which delivers activities
                                                 market with compelling reasons to travel to        and training to promote New Zealand’s
                                                 New Zealand.                                       unique Mäori cultural identity, both within
                                                                                                    the organisation and wider industry.

                                                 SIMON DOUGLAS
                                                 ManaGer Corporate
                                                 strateGy anD planninG

                                                 Simon is responsible for government liaison
                                                 and the preparation of strategic documents,
                                                 including Tourism New Zealand’s Statement
                                                 of Intent, Output Agreements and business
                                                 plan with the Minister of Tourism. He also
                                                 manages funding relationships with
                                                 government, which includes evaluating the
                                                 effectiveness of the Government’s investment
                                                 in tourism.
14   // TourIsm ANNuAl rePorT // 2008 – 2009
// TourIsm ANNuAl rePorT // 2008 – 2009                      sTATemeNT of serVICe PerformANCe   15




  STATEMENT OF
  SERvICE
  PERFORMANCE
  OvERvIEW
  This report covers The New Zealand Tourism board’s
  (trading as Tourism New Zealand) service performance
  for the year ending 30 June 2009 against the objectives
  set out in the 2008/09 statement of Intent.

  Tourism New Zealand’s resource allocation decisions were
  based on the extent to which each proposed activity
  would contribute towards its objectives and the delivery
  of outputs contained in the 2008/09 statement of Intent.
16     sTATemeNT of serVICe PerformANCe
       HeAdING To Go Here                                                                                                                    // TourIsm ANNuAl rePorT // 2008 – 2009




     In 2008/09 Tourism New Zealand’s activities were funded through two output Classes within Vote Tourism:

     MARKETING OF NEW ZEALAND AS A vISITOR DESTINATION

                                                                      Actual                                  Statement of Intent                                   Actual
                                                                     2008/09                                       2008/09                                         2007/08
                                                                      $000                                          $000                                            $000

       VOTE TOURISM – MARKETING OF NEw ZEAlANd AS A VISITOR dESTINATION

       Crown revenue 1                                               $75,501                                        $73,001                                        $74,851

       other revenue 2                                                $9,306                                         $1,950                                        $13,336

       Total revenue                                                 $84,807                                        $74,951                                        $88,187

       Total expenses 3                                              $89,519                                        $76,451                                        $84,144


     This output Class involves the promotion of New Zealand as a visitor destination in key international markets. This includes consumer
     advertising, promotion through media and events, training for international travel sellers and communication strategies. These activities
     are supported by product marketing, market research, tourism development and stakeholder communications; and are developed in
     consultation and partnership with the tourism industry.

     IMPLEMENTATION OF THE TOURISM STRATEGY

                                                                        Actual                                   Statement of Intent                                  Actual
                                                                       2008/09                                        2008/09                                        2007/08
                                                                        $000                                           $000                                           $000

       VOTE TOURISM – IMPlEMENTATION OF THE TOURISM STRATEGY

       Crown revenue 4                                                    $750                                            $430                                          $220

       Total expenses                                                     $750                                            $430                                          $220


     This output Class includes various initiatives to implement the New Zealand Tourism strategy. In 2008/09 Tourism New Zealand was
     allocated funding from within this appropriation to support the ongoing implementation of the Qualmark New Zealand environmental
     accreditation scheme for tourism operators and to run a Qualmark consumer awareness campaign “100% Pure Assurance”. Tourism
     New Zealand incorporated these initiatives into its capability activities.



                                                                                                     Left: British actor and
                                                                                                     comedian Stephen Fry
                                                                                                     visited New Zealand to
                                                                                                     film the BBC series
                                                                                                     Last Chance to See which
                                                                                                     screened to around two
                                                                                                     million British viewers.




     1. Crown revenue for the year includes $4 million for strategic tourism marketing of New Zealand in China, and a one-off government grant of $2.5 million for a marketing
        campaign in Australia.
     2. Other revenue includes foreign exchange gains, bank interest and partner revenue.
     3. Total expenditure reflects the utilisation of the increase in partner revenue received, foreign exchange gains made and additional funding received during the year,
        which were primarily directed to campaign activity.
     4. Crown revenue for the year includes additional funding of $0.320 million for a Qualmark consumer awareness campaign.
  // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                        HeAdING To Go Here
                                                                                                                                                          CAmPAIGN    17




MARKETING OF NEW ZEALAND
AS A vISITOR DESTINATION:
CAMPAIGN
The Tourism New Zealand global marketing campaign, 100% Pure New Zealand, seeks to establish New Zealand as a ‘top of mind’
destination for travellers seeking authentic experiences that connect directly with our land and our people. The campaign promotes
the core essence of the New Zealand experience, showing visitors how they can interact with our culture and natural environment.

The campaign is targeted at potential travellers whose expectations match what New Zealand has to offer. These people travel regularly,
participate in a wide range of tourism experiences, actively participate in a natural environment, are environmentally and culturally aware,
seek authentic and new experiences and want to share them with others. Tourism New Zealand refers to these visitors as the ‘Interactive
Traveller®’.

AWARENESS OF NEW ZEALAND AS A TRAvEL DESTINATION
1. maintain existing awareness levels for New Zealand as a travel destination in the following key markets:


                                   2007/08                                                             2008/09                                        2008/09

                                   Average                        Q1                         Q2                          Q3                Q4          Average

  Interactive Travellers

  Australia                          55%                         52%                        41%                        53%                 51%          49%

  uK                                 29%                         24%                        31%                        33%                 33%          30%

  usA                                18%                         17%                        14%                        15%                 20%          17%

  Japan                              19%                         18%                        15%                        21%                 19%          18%

  China                              35%                         44%                        47%                        42%                 55%          47%

  south Korea                        23%                         26%                        21%                        22%                 30%          25%

  Germany                            19%                         19%                        20%                        20%                 18%          19%

  Non Interactive Travellers

  Australia                          51%                         50%                        36%                        47%                 44%          44%

  long Haul Travel Intenders

  uK                                 26%                         21%                        25%                        29%                 29%          26%

  usA                                15%                         13%                        11%                        12%                 15%          13%

  Japan                              17%                         16%                        13%                        15%                 15%          15%

  China                              32%                         36%                        39%                        37%                 43%          38%

  south Korea                        20%                         22%                        17%                        18%                 27%          21%

  Germany                            17%                         17%                        17%                        18%                 15%          17%

  status                                                                                               Achieved




A result shown in green indicates a statistically significantly higher result than the previous time period at the 95% confidence level.
A result shown in red represents a statistically significantly lower result than the previous time period at the 95% confidence level.
18     CAmPAIGN                                                                                                                                 // TourIsm ANNuAl rePorT // 2008 – 2009




       Commentary

       A number of markets have experienced an increase in unprompted awareness compared to 2007/08 levels, the most significant being
       for Interactive Travellers in China (+12%); whilst other markets have experienced a decline in unprompted awareness, the most
       significant being for Interactive Travellers in Australia (-7%).

       unprompted awareness levels for New Zealand are highest in Australia and China and lowest in the usA and Japan.

       over the past year, Interactive Traveller awareness levels have remained higher than that of non-Interactive travellers in Australia
       and long Haul Travel Intenders in all other markets.


     2. report on prompted awareness levels for the 100% Pure New Zealand campaign in the following key markets:


                                        2007/08                                                             2008/09                                                      2008/09

                                        Average                        Q1                         Q2                          Q3                       Q4                 Average

       Interactive Travellers

       Australia                          52%                         54%                        52%                        55%                       56%                  54%

       uK                                 29%                         36%                        37%                        38%                       35%                  37%

       usA                                16%                         8%                         10%                        12%                       10%                  10%

       Japan                              15%                         15%                        14%                        17%                       18%                  16%

       China                              32%                         26%                        38%                        38%                       42%                  36%

       south Korea                        17%                         15%                        11%                        13%                       21%                  15%

       Germany                            17%                         23%                        22%                        27%                       26%                  25%

       Non Interactive Travellers

       Australia                          43%                         47%                        43%                        47%                       46%                  46%

       long Haul Travel Intenders

       uK                                 27%                         27%                        31%                        33%                       32%                  31%

       usA                                13%                         8%                          9%                         9%                       8%                    8%

       Japan                              11%                         11%                        12%                        14%                       14%                  13%

       China                              26%                         22%                        30%                        33%                       34%                  30%

       south Korea                        14%                         13%                        11%                        13%                       19%                  14%

       Germany                            16%                         18%                        20%                        27%                       23%                  22%

       status                                                                                              Achieved




       Commentary

       Awareness of the 100% Pure New Zealand brand has remained high throughout the year with significant increases in the key markets
       of the uK, China and Germany. Awareness is at its highest in Australia, the uK and China and at its lowest in the usA, south Korea
       and Japan.




     A result shown in green indicates a statistically significantly higher result than the previous time period at the 95% confidence level.
     A result shown in red represents a statistically significantly lower result than the previous time period at the 95% confidence level.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                        CAmPAIGN   19




RANKING OF NEW ZEALAND AS A PREFERRED HOLIDAY DESTINATION
3. maintain New Zealand’s ranking as a preferred holiday destination in Australia.


   Preferred                                                                     Australia
  destination
                               Q1                               Q2                                     Q3                                  Q4

                         %          Ranking             %              Ranking               %                 Ranking        %                 Ranking

 2007/08             29%               1st              27%              2nd                 27%                2nd          29%                  1st

 2008/09             27%               1st              29%               1st                31%                 1st         30%                  1st

 status                                                                          Achieved




 Commentary

 Throughout 2008/09 New Zealand consistently achieved the highest ranking of the top 5 preferred destinations to visit for holiday or
 leisure purposes in the next three years by Australians.


4. Improve New Zealand’s ranking as a preferred holiday destination in the uK, usA and Japan.


                                                              New Zealand Identified as a Preferred destination

                                      Q1                          Q2                             Q3                          Q4                  Average

  Country         Year          %            Ranking        %          Ranking           %            Ranking            %        Ranking          %

                                                                       6th =
                2007/08      21%           3rd          17%            with          20%              6th              21%        5th           20%
                                                                       Canada
 uK                                        5th =                                                      7th =
                                                                       5th =                                                      8th =
                                           with Italy                                                 with
                2008/09      21%                        18%            with          18%                               18%        with          19%
                                           and                                                        south
                                                                       france                                                     Thailand
                                           egypt                                                      Africa

                                                                       11th =
                                                                       with
                                           10th =                                                                                 12th =
                                                                       brazil,
                2007/08      12%           with         11%                          18%              6th              11%        with          13%
                                                                       Greece
                                           Japan                                                                                  Germany
 usA                                                                   and
                                                                       egypt

                                                                       8th =                          11th =                      11th =
                2008/09      12%           12th         14%            with          12%              with             13%        with          13%
                                                                       Greece                         Japan                       egypt

                                                                       4th =                                                      5th =
                2007/08      18%           7th          23%            with          17%              6th              21%        with          19%
                                                                       Canada                                                     Canada
 Japan                                     3rd =
                                           with Italy                                                 5th =
                2008/09      22%                        21%            4th           20%                               20%        5th           21%
                                           and                                                        with usA
                                           Canada

 status                                                                  Partially Achieved




 Commentary

 Throughout 2008/09 New Zealand’s ranking as one of the top 5 preferred destinations to visit for holiday or leisure purposes in the next
 three years has shown some improvement in absolute figures in each market although these improvements are not statistically significant.
 The percentage indicates the number of Interactive Travellers surveyed who named New Zealand in their top 5 preferred destinations.
20     CAmPAIGN                                                                                                                                 // TourIsm ANNuAl rePorT // 2008 – 2009




     CONvERSION RATIO
     5. Improve the 2007/08 conversion ratio between awareness, preference, intention and holiday arrivals for key markets of Australia, the
     uK, usA and Japan.

                                                       Measure                                                       2007/08                                    2008/09

       Australia               Conversion ratio Awareness to Preference                                                 38%                                       34%

                                Conversion ratio Preference to Intention                                                30%                                       33%

                                                       Arrivals                                                      382,880                                    401,712

       USA                     Conversion ratio Awareness to Preference                                                 34%                                       31%

                                Conversion ratio Preference to Intention                                                24%                                       22%

                                                       Arrivals                                                      132,972                                    119,132

       UK                      Conversion ratio Awareness to Preference                                                 34%                                       34%

                                 Conversion ratio Preference to Intention                                               26%                                       36%

                                                       Arrivals                                                      146,737                                    128,908

       Japan                   Conversion ratio Awareness to Preference                                                 44%                                       40%

                                 Conversion ratio Preference to Intention                                               30%                                       32%

                                                       Arrivals                                                       88,714                                     64,723

       Status                                                                                   Partially Achieved




       Commentary

       The conversion ratio between unprompted awareness, top 5 preference to visit in the next three years and most preferred destination
       to visit next remained consistent in all markets apart from the uK, which experienced a significant improvement for the conversion ratio
       of preference to intention.



     SHOULDER SEASON ARRIvALS
     6. Achieve a volume target of 69,262 (september-october 2008) and 68,102 (march-April 2009) for Australian shoulder season holiday visitors.


                 Shoulder Season                           Target Australian Holiday                            Actual Australian                                Variance
                                                                    visitors                                     Holiday visitors

       Sep – Oct 2008                                                  69,262                                          62,490                                     -6,772

       Mar – Apr 2009                                                  68,102                                          71,126                                     +3,024

       Status                                                                                                   Partially Achieved




       Commentary

       As a result of the global economic downturn arrival figures have fallen in many of Tourism New Zealand’s key markets. Holiday arrivals
       from Australia for the september to october 2008 shoulder season were below target. A one-off government grant of $2.5 million
       enabled Tourism New Zealand to undertake additional campaign activity in Australia in autumn 2009. Holiday arrivals from Australia
       were above target for the march – April 2009 shoulder season.


     The total cost of delivering Campaign outputs in 2008/09 was $49.09 million.




     A result shown in green indicates a statistically significantly higher result than the previous time period at the 95% confidence level.
     A result shown in red represents a statistically significantly lower result than the previous time period at the 95% confidence level.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                CHANNel     21




MARKETING OF NEW ZEALAND AS
A vISITOR DESTINATION: CHANNEL
The channel component of Tourism New Zealand’s strategy aims to convert travellers’ intention to travel to New Zealand into actual arrivals,
using both internet technology and the travel distribution system to assist in the conversion process. Tourism New Zealand’s consumer and
trade marketing activities also provide a local presence in key overseas markets that reinforce the messages in the 100% Pure New Zealand
campaign. These activities are complemented by online marketing, using Tourism New Zealand’s consumer website www.newzealand.com
as a tool for providing information about New Zealand and systems to facilitate planning and booking travel to New Zealand.

HOLIDAY ARRIvALS
7. maintain holiday arrivals at 2007/08 levels.


                                           YE Jun 06                 YE Jun 07                   YE Jun 08                   YE Jun 09

 Holiday arrivals                          1,171,730                1,213,288                   1,209,241                    1,153,702

 % change over previous year                 -4%                        4%                          0%                            -5%

 Status                                                                          Not achieved




 Commentary

 As a result of the global economic downturn and a fall in consumer confidence holiday arrival figures have fallen in many of Tourism
 New Zealand’s key markets. This is reflected in an overall decrease in holiday arrivals for 2008/09.


8. maintain the proportion of Interactive Travellers® at 65%.


                                                                  YE June 08                                      YE June 09

 Holiday Arrivals                                                 1,209,241                                       1,153,702

 Proportion of Interactive Travellers                               62.8%                                           65.6%

 Status                                                                                    Achieved




 Commentary

 despite an overall decrease in holiday arrivals for 2008/09, the proportion of Interactive Travellers (Tourism New Zealand’s key target
 market) has increased during 2008/09.



TRADE TRAINING
9. satisfaction levels of international travel sellers with Tourism New Zealand’s trade training activities are above 90% for extremely satisfied
and very satisfied.


 Trade Training Activities                                                               Percentage extremely or very satisfied

 Trade Training                                                                                          100%

 Trade Training Modules                                                                                   97%

 Trade Famils                                                                                            100%

 Status                                                                                                Achieved


The total cost of delivering Channel outputs in 2008/09 was $16.337 million.
22      CAPAbIlITY                                                                                          // TourIsm ANNuAl rePorT // 2008 – 2009




     MARKETING OF NEW ZEALAND
     AS A vISITOR DESTINATION:
     CAPABILITY
     New Zealand will always be a niche player in world tourism given our geographic distance from most main markets and the comparatively high
     cost to travel here. for this reason, Tourism New Zealand’s goal behind its capability strategy is to focus on ensuring New Zealand provides a
     quality experience for visitors. This ensures visitor satisfaction levels and word-of-mouth promotion of New Zealand as a destination remains
     high.

     Key activities within this output are market research, communication with the industry and other key stakeholders, promoting and providing
     support for the Qualmark quality assurance and environmental accreditation schemes and visitor information services
     provided by i-sITe New Zealand.

     NEW ZEALAND AS A HOLIDAY DESTINATION
     10. 80% of Interactive Travellers are ‘very likely’ to recommend New Zealand as a holiday destination as reported in the Annual Visitor
     experience monitor


      Measure                                                                     2008/09 Target                       2008/09 Actual

      Proportion of Interactive Travellers who were very likely to                      80%                                 84%
      recommend New Zealand

      Status                                                                                            Achieved



     IMPLEMENTATION OF THE TOURISM STRATEGY
     11. maintain the number of Qualmark licence holders above 2,200.


      Measure                                                                     2008/09 Target                       2008/09 Actual

      Number of Qualmark licence Holders                                               2,200                                2,206

      Status                                                                                            Achieved


     12. Align the statement of Intent with the New Zealand Tourism strategy 2015


      Result

      Tourism New Zealand’s outcomes framework and output structure were reviewed and revised during 2008/09, ensuring alignment of
      the 2009/10 and future statements of Intent with the New Zealand Tourism strategy 2015.

      Status                                                                                            Achieved


     The total cost of delivering Capability outputs in 2008/09 was $24.842 million.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                   mANAGemeNT sTATemeNTs              23




MANAGEMENT
STATEMENTS
IMPACT OF TOURISM NEW ZEALAND OUTPUTS ON
INTERNATIONAL vISITOR ARRIvALS AND ExPENDITURE
The number of visitors to New Zealand and the amount they spend
is dependent on many variables. These include:

•	 the marketing activities of competing destinations and the
   efforts of other National Tourism offices;

•	 changes in consumer behaviour and expectations affecting
   travel and expenditure decisions;

•	 private sector spend and pricing strategies employed;

•	 airline scheduling decisions, seat capacity on air routes and
   ticket pricing;

•	 exchange rates and the general economic conditions in
   countries of origin.

International visitor arrivals for the year ending 30 June 2009      Above: Tourism New Zealand continued to support the TRENZ industry expo, which
                                                                     saw 260 international travel sellers visit Auckland to find out more about New Zealand
were 2.41 million, a 2.8 per cent decrease over the previous year.   tourism products.
International visitor expenditure (sourced from the revised
International Visitor survey) for the year ended 30 June 2009
was $6.016 billion, representing a 2.6 per cent decrease over
the previous year.

while it is not possible to determine the extent to which Tourism
New Zealand’s outputs directly impacted on visitor numbers and
spend for the year given the range and complexity of externalities
involved, Tourism New Zealand’s delivery of outputs in 2008/09,
and in previous years, will have contributed to the year’s total
visitor arrivals and expenditure through:

•	 raising the profile of New Zealand as a visitor destination
   through continued delivery of the 100% Pure New Zealand
   global and targeted campaigns in key international markets;

•	 deepening consumer understanding and enthusiasm for
   New Zealand as a holiday destination and making it easy for
   them to plan and book their travel through online tools;

•	 working with the travel trade to effectively sell destination
   New Zealand in order to convert visitor interest into actual
   travel;

•	 providing the industry with market intelligence, including
   insights into the needs and preferences of international
   consumers, to better inform their activities;

•	 providing leadership to the industry (through Tourism
   New Zealand’s commitments to Qualmark limited and i-sITe
   New Zealand) to support the delivery of a quality system which
   maintains visitor satisfaction at a high level and encourages
   positive word-of-mouth about the New Zealand experience.
24     mANAGemeNT sTATemeNTs                                                                                        // TourIsm ANNuAl rePorT // 2008 – 2009




     EQUAL EMPLOYMENT OPPORTUNITIES
     under section 151 (1)(g) of the Crown entities Act 2004, Tourism New Zealand is required to provide information about compliance with
     obligations to be a good employer (including our equal employment opportunities (eeo) Programme).


     workplace profile for Tourism New Zealand as at 30 June 2009.

                                                                     direct Reports to
                                                                  Executive Managers or          Other Managers with Staff           Professional and
                                       Executive Management
                                                                 Staff with Responsibility        Responsibility (4th Tier)            Support Staff
                                                                for Specific Output Areas
      NZ European

      men                                        44%                      48%                               6%                              8%

      female                                     44%                      29%                              44%                              41%
      Mäori

      male                                                                                                                                  3%

      female                                                              10%                                                               1%
      Pacific Peoples

      male

      female                                                                                                                                1%
      Asian (inc South Asian)

      male                                                                 5%                               6%                              7%

      female                                                                                               31%                              26%
      Other

      male                                       11%                                                        6%

      female                                                              10%                               6%                              14%
      Percentage of Group
      of Total Organisation                       8%                      18%                              13%                              62%

     Note: Totals do not add up to 100% due to roundings.




     WORKPLACE PROFILE BY AGE                                                    WORKPLACE PROFILE BY ETHNICITY

     Not kNowN                                                                         other

         60-69                                                                         aSiaN
                                                                            (iNc South aSiaN)
         50-59                                                                                                                               male

                                                                               pacific people                                               female
         40-49

         30-39                                                                         maori


         20-29                                                                  NZ europeaN

              0%         10%           20%          30%       40%        50%                0%       10%          20%       30%       40%            50%      60%


     women are well represented at all levels in the organisation. Tourism New Zealand recognises the need for the greater involvement of
     mäori, and continues to promote this through the mäori development strategy and mäori Graduate development Programme, which is
     now in its 8th year.
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                             mANAGemeNT sTATemeNTs      25




LEADERSHIP, ACCOUNTABILITY AND CULTURE                                   FLExIBILITY AND WORK DESIGN
Tourism New Zealand is committed to being a good employer.               Tourism New Zealand has an active programme of supporting
This is reflected in our approach to the management and                  flexible working arrangements and job design. we continue to:
leadership of all employees, which works to ensure their
fair and proper treatment in all aspects of their employment.            •	 support parents in their return to work by offering part time
                                                                            and gradual return to full time arrangements and flexitime
our executive Team and broader management group is committed                to accommodate child care needs;
to demonstrating leadership and accountability in all areas of eeo.
from an eeo perspective, this means a commitment to and activity         •	 support expectant parents by granting additional time away
in the following areas:                                                     from work to attend appointments associated with the
                                                                            pregnancy;
RECRUITMENT, SELECTION AND INDUCTION                                     •	 support staff with responsibilities for child and eldercare
our recruitment and selection procedures ensure that all                    by offering on-going flexible working arrangements;
prospective employees are given the opportunity to participate
                                                                         •	 support staff members with disabilities with flexitime and
equally in the recruitment process. Interview questions are drawn
                                                                            part time working arrangements.
from a carefully developed question bank designed to ensure that
the selected applicant’s skills and abilities are the best fit for the
position and the organisation. This includes providing appropriate
                                                                         REMUNERATION, RECOGNITION AND CONDITIONS
support for Mäori and Pacific peoples and people with english as         Internal promotions are based on individual skills and experience,
a second language during the recruitment and selection process.          and recognise performance regardless of ethnicity, gender or
                                                                         physical ability.
our three-day ‘welcome to Tourism New Zealand’ programme is
run as required and led by a member of our executive Team.               Individuals identified as not meeting the requirements of their role
each programme includes a significant cultural component which           are provided with support, training and development where
explores the significance of aspects of tikanga Mäori for our            required to assist them to achieve success in their role.
organisation and includes mihi and waiata training.
                                                                         HARASSMENT AND BULLYING PREvENTION
Tourism New Zealand has an active Mäori graduate programme,
                                                                         Tourism New Zealand has a very strictly adhered to policy and
which has to date recruited a total of six Mäori graduates. five of
                                                                         procedure for dealing with work place harassment and bullying.
these continue to be employed by Tourism New Zealand in a
                                                                         In the 12 months being reported on, there have been no reported
variety of roles, and one left soon after the completion of their
                                                                         allegations relating to harassment and/or bullying.
graduate programme to join a regional Tourism organisation
(rTo). In late 2009 we will be seconding a second former
graduate to an rTo.
                                                                         SAFE AND HEALTHY ENvIRONMENT
                                                                         Tourism New Zealand works to maintain a good and safe working
EMPLOYEE DEvELOPMENT, PROMOTION AND ExIT                                 environment for all employees. we have published and well
                                                                         understood health and safety policies, which have been developed
Tourism New Zealand has an active management and leadership
                                                                         to actively encourage staff involvement. Additional support for
development programme for those identified with leadership and
                                                                         people, particularly those with disabilities, has over the last
management potential. Participants for this programme are
                                                                         12 months included specialist work place assessments and the
nominated by their managers on the basis of performance.
                                                                         provision of special equipment to ensure that employees are able
other training and development needs are identified on an                to contribute effectively in all aspects of their working life.
individual basis and are agreed between the manager and
employee with development programmes being selected to meet
individual identified needs. developmental activities provided to
employees include coaching and mentoring, external training,
tertiary study and on the job training.

Te wiki o Te reo Mäori and matariki are also actively supported
by Tourism New Zealand with a planned programme to provide
additional skills training and learning opportunities.

Tourism New Zealand has also continued to build on our earlier
programme of work designed to develop and grow our
organisational capability in tikanga Mäori. This is now a main
stream activity within our organisation. As a result our staff has
an understanding of tikanga Mäori, which is infused throughout
the organisation.
26   fINANCIAl sTATemeNTs                                                        // TourIsm ANNuAl rePorT // 2008 – 2009




      FINANCIAL
      STATEMENTS
       STATEMENT OF RESPONSIBILITY
       In terms of the Crown entities Act 2004, the board is responsible for
       the preparation of the New Zealand Tourism board’s financial
       statements and statement of service performance, and for the
       judgements made in them.

       The board of New Zealand Tourism board has the responsibility for
       establishing, and has established, a system of internal control
       designed to provide reasonable assurance as to the integrity and
       reliability of financial reporting.

       In the board’s opinion, these financial statements and statement of
       service performance fairly reflect the financial position and operation
       of the New Zealand Tourism board Group for the year ended 30
       June 2009.

       The members of the New Zealand Tourism board and Group
       authorised these financial statements for issue on 29 october 2009.

       signed on behalf of the board:




       G. muir                                            s. Johnstone
       Chair                                              deputy Chair
       29 october 2009                                    29 october 2009
       // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                            fINANCIAl sTATemeNTs   27




Statement of Financial Performance for the year ended 30 June 2009
                                                                                                       GROUP                                   PARENT
                                                                                            2009            2009            2008       2009       2009          2008
                                                                      Notes                Actual          Budget           Actual    Actual     Budget         Actual
                                                                                           $000s           $000s           $000s      $000s      $000s         $000s
   Income
   revenue from Crown                                                 2                  76,251          73,431          75,071      76,251     73,431        75,071
   Interest income                                                                           384             707              711       382        700           707
   other revenue                                                      3                   5,478            3,715           6,906      2,996      1,250         4,630
   foreign exchange gains                                             4                   5,928                  0         7,999      5,928          0         7,999
   Total Income                                                                         88,041           77,853          90,687      85,557     75,381        88,407


   Expenditure
   other expenses                                                     5                  83,317          78,625          83,556      80,898     76,251        81,285
   depreciation & Impairment                                                                 761             718              625       680        630           602
   foreign exchange losses                                            6                   8,691                  0         2,477      8,691          0         2,477
   Total Expenditure                                                  7                  92,769         79,343           86,658      90,269     76,881        84,364


   Net Operating Surplus/(deficit) before                                               (4,728)          (1,490)           4,029     (4,712)    (1,500)        4,043
   Taxation


   Income tax expense                                                 20                         0               0               0        0          0              0
   minority interests in profits/(losses) of
   subsidiaries                                                       8                        13                0            (61)        0          0              0
   share of loss/(gain) of associate company                          9                          3               0               3        0          0              0
   Net Surplus/(deficit) for the year                                                   (4,744)          (1,490)           4,087     (4,712)    (1,500)        4,043

The notes and accounting policies on pages 29 to 49 form part of and are to be read in conjunction with these financial statements
28   fINANCIAl sTATemeNTs                                                                                                                   // TourIsm ANNuAl rePorT // 2008 – 2009




       Statement of Financial Position as at 30 June 2009
                                                                                                              GROUP                                         PARENT
                                                                                                   2009            2009            2008            2009          2009         2008
                                                                             Notes                Actual          Budget           Actual          Actual      Budget        Actual
                                                                                                  $000s           $000s           $000s           $000s        $000s         $000s


          Current Assets
          Cash                                                               10                   3,817          3,530            5,200           3,646        3,500        5,077
          receivables                                                        11                     559           1,070           1,324             517        1,000        1,286
          Prepayments & other current assets                                                        612             305           1,029             603          300         1,018
          derivative financial instruments                                   12                         0               0         1,514                0             0       1,514
                                                                                                 4,988           4,905            9,067           4,766        4,800        8,895
          Non-current Assets
          Property plant and equipment                                       13                  2,240           2,280            2,165           2,096        2,012        1,943
          Investment in associate                                            9                          4               5               7              0             0            0
          Accommodation bonds                                                14                     494             275             343             494           275          343
                                                                                                 2,738           2,560            2,515           2,590        2,287        2,286
          Total Assets                                                                            7,726           7,465         11,582            7,356        7,087       11,181


          Current liabilities
          Creditors and other payables                                       15                  3,666           4,459            4,278           3,325        3,998        3,893
          employee entitlements                                              16                   1,140              810             927          1,100          780           891
          Income in advance                                                                         160              110            335             107           100          310
          Provisions                                                         17                     303                 0           303             303              0         303
          derivative financial instruments                                   12                  1,469                  0             20          1,469              0          20
                                                                                                 6,738            5,379           5,863           6,304        4,878         5,417
          Total liabilities                                                                      6,738            5,379           5,863           6,304        4,878         5,417
          Net Assets                                                                                988           2,086            5,719          1,052         2,209        5,764


          Equity
          shareholder's equity                                                                   1,805           1,805            1,805           1,805        1,805        1,805
          retained earnings                                                                       (880)             281           3,864           (753)          404        3,959
          minority interests                                                 8                        63                0             50               0             0            0
          Total Equity                                                                              988           2,086            5,719          1,052         2,209        5,764




       Statement of Changes in Equity for the year ended 30 June 2009
                                                                                                              GROUP                                         PARENT
                                                                                                   2009            2009            2008            2009          2009         2008
                                                                             Notes                Actual          Budget           Actual          Actual      Budget        Actual
                                                                                                  $000s           $000s           $000s           $000s        $000s         $000s


          Balance at 1 July                                                                       5,719           3,576           1,693           5,764        3,709         1,721


          movement in minority interest                                                               13                0            (61)              0             0            0
          Net surplus/(deficit) for the year                                                   (4,744)          (1,490)           4,087         (4,712)      (1,500)        4,043


          Balance at 30 June                                                                        988          2,086            5,719           1,052        2,209         5,764

       The notes and accounting policies on pages 29 to 49 form part of and are to be read in conjunction with these financial statements
  // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                                            fINANCIAl sTATemeNTs   29




Statement of Cash Flows for the year ended 30 June 2009
                                                                                                       GROUP                                     PARENT
                                                                                            2009            2009            2008        2009        2009        2008
                                                                      Notes                Actual          Budget           Actual      Actual     Budget      Actual
                                                                                           $000s           $000s           $000s       $000s       $000s       $000s
   Cash flows from operating activities


   Crown revenue                                                                         76,251          73,431          75,071       76,251      73,431     75,071
   Interest received                                                                         413             707             687         411         700        683
   other revenue                                                                          5,897           3,635            6,695       3,473       1,200      4,392
   Payments to suppliers and employees                                                (82,700)        (76,663)         (79,545)      (80,302)    (74,381)   (77,468)
   Goods and services tax (net)                                                                21                0            274          (1)         0        306
   Net cash from operating activities                                 18                   (118)           1,110           3,182        (168)        950      2,984


   Cash flows from investing activities


   sale of property plant and equipment                                                          0               0             30           0          0          30
   repayment of accommodation bonds                                                          113                 0              10       113           0          10
   Purchase of property plant and equipment                                                (817)           (850)         (1,551)        (815)      (700)     (1,313)
   Payments for accommodation bonds                                                        (244)                 0           (55)       (244)          0        (55)
   Net cash outflow from investing activities                                              (948)           (850)         (1,566)        (946)      (700)     (1,328)


   Net increase/(decrease) in cash held                                                 (1,066)              260           1,616      (1,114)        250      1,656


   effect of exchange rates on foreign currency
   balances                                                                                (317)                 0            149       (317)          0         149
   opening cash brought forward                                                           5,200            3,270           3,435       5,077       3,250      3,272
   Cash at end of year                                                10                   3,817          3,530            5,200       3,646       3,500      5,077

The notes and accounting policies on pages 29 to 49 form part of and are to be read in conjunction with these financial statements




Notes to the Financial Statements for the year ended 30 June 2009

   Note 1
   Statement of accounting policies for the year ended 30 June 2009


(a) basis of preparation                                                                      (b) statement of compliance
Tourism New Zealand is a Crown entity as defined by the Crown                                 The financial statements have been prepared in accordance with
entities Act 2004 and is domiciled in New Zealand. As such,                                   New Zealand equivalents to International financial reporting
Tourism New Zealand’s ultimate parent is the New Zealand Crown.                               standards (NZ Ifrs) and other applicable financial reporting
                                                                                              standards as appropriate for Public benefit entities.
Tourism New Zealand’s financial statements have been prepared
in accordance with New Zealand generally accepted accounting                                  The financial statements are presented in New Zealand dollars
practice and the requirements of the Crown entities Act 2004.                                 and all values are rounded to the nearest thousand dollars ($000).
The financial statements have been prepared on a historical cost                              The functional currency is New Zealand dollars.
basis modified by the revaluation of certain assets and liabilities
as identified in this statement of accounting policies.
                                                                                              (c) New accounting standards and interpretations
                                                                                              standards and interpretations that have recently been issued
for the purposes of financial reporting, Tourism New Zealand                                  or amended but are not yet effective have not been adopted by
is classified as a Public benefit entity.                                                     Tourism New Zealand for the annual reporting period ending
                                                                                              30 June 2009. These are outlined in the following table.
30   fINANCIAl sTATemeNTs                                                                                          // TourIsm ANNuAl rePorT // 2008 – 2009




           Reference            Title                               Summary                             Application         Impact on        Application
                                                                                                          date of              Group          date for
                                                                                                         standard            financial         Group
                                                                                                                               report
        NZ IAs 1            Presentation    Introduces a statement of comprehensive income.            1 January          Presentation      1 July 2009
        (revised)           of financial    other revisions include impacts on the presentation        2009               changes only
                            statements      of items in the statement of changes in equity, new                           with no
                            and             presentation requirements for restatements or                                 impact on the
                            consequential   reclassifications of items in the financial statements,                       financial
                            amendments      changes in the presentation requirements for                                  statements.
                            to other        dividends and changes to the titles of the financial
                            New Zealand     statements.
                            Accounting
                            standards


        NZ Ifrs 3           business        The revised standard introduces a number of                1 July             The initial       1 July 2009
        (revised)           Combinations    changes to the accounting for business                     2009               application of
                                            combinations, the most significant of which allows                            this Ifrs is
                                            entities a choice for each business combination                               not expected
                                            entered into, to measure a non-controlling interest                           to have an
                                            (formerly a minority interest) in the acquiree either at                      impact on the
                                            its fair value or at its proportionate interest in the                        financial
                                            acquiree’s net assets. This choice will effectively                           statements.
                                            result in recognising goodwill relating to 100% of the
                                            business (applying the fair value option) or
                                            recognising goodwill relating to the percentage
                                            interest acquired. The changes apply prospectively.
        NZ IAs 27           Consolidated    under the revised standard, a change in the                1 July             The initial       1 July 2009
        (revised)           and separate    ownership interest of a subsidiary (that does not          2009               application of
                            financial       result in loss of control) will be accounted for as an                        this NZ IAs is
                            statements      equity transaction.                                                           not expected
                            (revised)                                                                                     to have an
                                                                                                                          impact on the
                                                                                                                          financial
                                                                                                                          statements.
        Amendments          Amendments      The improvements project is an annual project that         1 January          The               1 July 2009
        to NZ Ifrs          to NZ Ifrs      provides a mechanism for making non-urgent, but            2009 except        application of
                            arising from    necessary, amendments to Ifrss. The IAsb has               for                Amendments
                            the Annual      separated the amendments into two parts: Part 1            amendments         to NZ Ifrs
                            Improvements    deals with changes the IAsb identified resulting in        to NZ Ifrs 5       are not
                            Project         accounting changes; Part II deals with either              which are          expected to
                                            terminology or editorial amendments that the IAsb          effective from     have an
                                            believes will have minimal impact.                         1 July 2009        impact on the
                                                                                                                          financial
                                                                                                                          statements.
        Amendments          Amendments      The amended Ifrs 7 requires fair value                     1 January          disclosure        1 July 2009
        to                  to Ifrs 7       measurements to be disclosed by the source of              2009               change only
        International                       inputs, using the following three-level hierarchy:                            with no
        financial                                                                                                         impact on the
                                            •	 Quoted prices in active markets for identical
        reporting                                                                                                         financial
                                               assets or liabilities (level 1);
        standards                                                                                                         statements.
                                            •	 Inputs other than quoted prices included in
                                               level 1 that are observable for the asset or
                                               liability, either directly (as prices) or indirectly
                                               (derived from prices) (level 2); and

                                            •	 Inputs for the asset or liability that are not based
                                               on observable market data (unobservable
                                               inputs) (level 3).
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                     fINANCIAl sTATemeNTs   31




(d) basis of consolidation                                               depreciation is calculated on a straight-line basis over the
The consolidated financial statements comprise the financial             estimated useful life of the asset as follows:
statements of New Zealand Tourism board trading as Tourism
                                                                         office equipment                             5 years
New Zealand and its subsidiaries as at 30 June each year
                                                                         motor vehicles                               4 – 5 years
(the Group).
                                                                         furniture and fittings                       5 – 8 years
subsidiaries are combined using the purchase method of                   Computer equipment                           3 years
combination. The financial statements of subsidiaries are prepared       leasehold improvements                       up to term of the lease
for the same reporting period as the parent company, using
                                                                         realised gains and losses arising from the disposal of property,
consistent accounting policies.
                                                                         plant and equipment are recognised in the statement of financial
Adjustments are made to bring into line any dissimilar accounting        Performance in the period in which the transaction occurs.
policies that may exist.
                                                                         Impairment
All intercompany balances and transactions, including unrealised         The carrying values of plant and equipment are reviewed for
profits arising from intra-group transactions, have been eliminated      impairment when events or changes in circumstances indicate the
in full. unrealised losses are eliminated unless costs cannot be         carrying value may not be recoverable.
recovered.
                                                                         If any such indication exists and where the carrying values exceed
subsidiaries are consolidated from the date on which control is          the estimated recoverable amount, the assets are written down to
transferred to the Group and cease to be consolidated from the           their recoverable amount. losses resulting from impairment are
date on which control is transferred out of the Group.                   reported in the statement of financial Performance.
where there is loss of control of a subsidiary, the consolidated         (h) Intangible assets
financial statements include the results for the part of the reporting   Intangible assets are recorded at cost at acquisition. where there
period during which Tourism New Zealand has control.                     is no active market for these assets, or they are determined to
business combinations that occurred prior to the date of transition      hold no future economic benefit, they are written off in the year
to NZ Ifrs have not been restated retrospectively.                       of acquisition. Tourism New Zealand has no intangible assets with
                                                                         a finite life.
(e) Investment in associate
The Group’s investment in associates is accounted for under              research and development costs are expensed as incurred.
the equity method of accounting in the consolidated financial            (i) Inventories
statements.                                                              Inventories are valued at the lower of cost and net realisable value.
An associate is an entity in which the Group has significant             (j) Trade and other receivables
influence and which is not a subsidiary nor a joint venture.             Trade receivables are recognised and carried at original invoice
The annual financial statements of the associate are used by the         amount less an allowance for any uncollectible amounts.
Group to apply the equity method. The reporting dates of the             An estimate for doubtful debts is made when collection of the
associate and the Group are identical and both use consistent            full amount is no longer probable. bad debts are written off when
accounting policies.                                                     identified.
The investment in the associate is carried in the balance sheet          (k) Cash and cash equivalents
at cost plus post-acquisition changes in the Group’s share of            Cash and short-term deposits in the statement of financial
net assets of the associate, less any impairment in value. The           Position comprise cash at bank and in hand and short-term
consolidated income statement reflects the Group’s share of the          deposits with an original maturity of three months or less.
results of operations of the associate.
                                                                         for the purposes of the statement of Cash flows, cash and cash
where there has been a change recognised directly in the                 equivalents consist of cash and cash equivalents as defined above.
associate’s equity, the Group recognises its share of any changes
and discloses this, when applicable in the consolidated statement        (l) Provisions
of changes in equity.                                                    Provisions are recognised when the Group has a present obligation
                                                                         (legal or constructive) as a result of a past event, and it is probable
(f) foreign currency                                                     that an outflow of resources embodying economic benefits will
Transactions denominated in foreign currency are recorded in             be required to settle the obligation and a reliable estimate can be
NZ dollars by applying exchange rates that approximate rates             made of the amount of the obligation.
prevailing at the date of the transaction.
                                                                         where the Group expects some or all of a provision to be
monetary assets and liabilities denominated in foreign currencies are    reimbursed, for example under an insurance contract, the
translated at the rate of exchange ruling at the balance sheet date.     reimbursement is recognised as a separate asset but only when
exchange gains and losses are recognised in the statement of             the reimbursement is virtually certain. The expense relating to any
financial Performance.                                                   provision is presented in the statement of financial Performance
                                                                         net of any reimbursement.
Non-monetary items that are measured in terms of historical cost
in a foreign currency are translated using the exchange rate as at       If the effect of the time value of money is material, provisions are
the date of the initial transaction.                                     determined by discounting the expected future cash flows at a
                                                                         rate that reflects current market assessments of the time value of
(g) Property, plant and equipment                                        money and, where appropriate, the risks specific to the liability.
Plant and equipment is stated at cost less accumulated
depreciation and any impairment in value.                                where discounting is used, the increase in the provision due to
                                                                         the passage of time is recognised as a finance cost.
32   fINANCIAl sTATemeNTs                                                                                         // TourIsm ANNuAl rePorT // 2008 – 2009




       (m) leases                                                                     ventures, and the timing of the reversal of the temporary
       The determination of whether an arrangement is or contains a                   difference can be controlled and it is probable that the
       lease is based on the substance of the arrangement and requires                temporary difference will not reverse in the foreseeable
       an assessment of whether the fulfilment of the arrangement                     future.
       is dependent on the use of a specific asset or assets and the
                                                                                  deferred income tax assets are recognised for all deductible
       arrangement conveys a right to use the asset.
                                                                                  temporary differences, carry-forward of unused tax credits and
       leases where the lessor retains substantially all the risks and benefits   unused tax losses, to the extent that it is probable that taxable profit
       of ownership of the asset are classified as operating leases. operating    will be available against which the deductible temporary differences
       lease payments are recognised as an expense in the statement of            and the carry-forward of unused tax credits and unused tax losses
       financial Performance on a straight-line basis over the lease term.        can be utilised, except:
       The Group does not enter into finance leases.                              •	 when the deferred income tax asset relating to the deductible
       (n) revenue                                                                   temporary difference arises from the initial recognition of an
       revenue is recognised to the extent that it is probable that the              asset or liability in a transaction that is not a business
       economic benefits will flow to the Group and the revenue can be               combination and, at the time of the transaction, affects neither
       reliably measured. The following specific recognition criteria must           the accounting profit nor taxable profit or loss; or
       also be met before revenue is recognised:
                                                                                  •	 when the deductible temporary difference is associated with
                                                                                     investments in subsidiaries, associates or interests in joint
       Grants received from the Crown
       Grants received from the Crown are recognised as revenue on receipt.          ventures, in which case a deferred tax asset is only recognised
                                                                                     to the extent that it is probable that the temporary difference
       Sale of goods and service                                                     will reverse in the foreseeable future and taxable profit will be
       revenue from the supply of goods and services is recognised                   available against which the temporary difference can be utilised.
       when the significant risks and rewards of ownership of the goods
                                                                                  The carrying amount of deferred income tax assets is reviewed
       have passed to the buyer and can be measured reliably. risks and
                                                                                  at each statement of financial Position date and reduced to the
       rewards are considered passed to the buyer at the time of delivery
                                                                                  extent that it is no longer probable that sufficient taxable profit will
       of the goods to the customer.
                                                                                  be available to allow all or part of the deferred income tax asset to
       revenue from the supply of services is recognised on a straight line       be utilised.
       basis over the specified period for the service unless an alternative
                                                                                  unrecognised deferred income tax assets are reassessed at each
       method better represents the stage of completion of the transaction.
                                                                                  statement of financial Position date and are recognised to the
       Interest                                                                   extent that it has become probable that future taxable profit will
       Interest revenue is recognised as interest accrues using the               allow the deferred tax asset to be recovered.
       effective interest method. This is a method of calculating the             deferred income tax assets and liabilities are measured at the
       amortised cost of a financial asset and allocating the interest            tax rates that are expected to apply to the year when the asset is
       income over the relevant period using the effective interest rate,         realised or the liability is settled, based on tax rates (and tax laws)
       which is the rate that exactly discounts estimated future cash             that have been enacted or substantively enacted at the statement
       receipts through the expected life of the financial asset to the net       of financial Position date.
       carrying amount of the financial asset.
                                                                                  deferred tax assets and deferred tax liabilities are offset only if a
       (o) Income tax                                                             legally enforceable right exists to set off current tax assets against
       Tourism New Zealand is exempt from income tax under the                    current tax liabilities and the deferred tax assets and liabilities
       New Zealand Tourism board Act 1991. Tourism New Zealand’s                  relate to the same taxable entity and the same taxation authority.
       subsidiaries are subject to income tax.
                                                                                  (p) other taxes
       Current tax assets and liabilities for the current and prior periods       revenues, expenses and assets are recognised net of the amount
       are measured at the amount expected to be recovered from or                of GsT except:
       paid to the taxation authorities based on the current period’s
       taxable income. The tax rates and tax laws used to compute the             where the GsT incurred on a purchase of goods and services is not
       amount are those that are enacted or substantively enacted by the          recoverable from the taxation authority, in which case the GsT is
       statement of financial Position date.                                      recognised as part of the cost of acquisition of the asset or as part
                                                                                  of the expense item as applicable; and
       deferred income tax is provided on all temporary differences at
       the statement of financial Position date between the tax bases             receivables and payables are stated with the amount of GsT
       of assets and liabilities and their carrying amounts for financial         included.
       reporting purposes.
                                                                                  The net amount of GsT recoverable from, or payable to, the
       deferred income tax liabilities are recognised for all taxable             taxation authority is included as part of receivables or payables in
       temporary differences except:                                              the statement of financial Position.

       •	 when the deferred income tax liability arises from the initial          Cash flows are included in the statement of Cash flows on a gross
          recognition of goodwill or of an asset or liability in a transaction    basis and the GsT component of cash flows arising from investing
          that is not a business combination and that, at the time of the         and financing activities, which is recoverable from, or payable to,
          transaction, affects neither the accounting profit nor taxable          the taxation authority are classified as operating cash flows.
          profit or loss; or                                                      Commitments and contingencies are disclosed net of the amount
       •	 when the taxable temporary difference is associated with                of GsT recoverable from, or payable to, the taxation authority.
          investments in subsidiaries, associates or interests in joint
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                       fINANCIAl sTATemeNTs   33




(q) financial instruments                                                 other employee entitlements. employee entitlements to salaries
                                                                          and wages, annual leave, long service leave, retiring leave
Tourism New Zealand uses derivative financial instruments such as         and other similar benefits are recognised in the statement of
foreign currency contracts to manage its exposure to foreign exchange     financial Performance when they accrue to employees. employee
risk arising from its operational activities. Tourism New Zealand does    entitlements to be settled within 12 months are reported at the
not hold or issue these financial instruments for trading purposes.       amount expected to be paid. The liability for long-term employee
Tourism New Zealand has not adopted hedge accounting.                     entitlements is reported as the present value of the estimated
derivatives are initially recognised at fair value on the date            future cash flows.
a derivative contract is entered into and are subsequently                Termination benefits. Termination benefits are recognised in
remeasured to their fair value at each balance date. movements in         the statement of financial Performance only where there is a
the fair value of derivative financial instruments are recognised in      demonstrable commitment to either terminate employment prior
the statement of financial Performance.                                   to normal retirement date or to provide such benefits as a result of
foreign exchange gains and losses resulting from the settlement           an offer to encourage voluntary redundancy. Termination benefits
of derivative financial instruments and from the translation at year      settled within 12 months are reported at the amount expected to
end exchange rates of monetary assets and liabilities denominated         be paid, otherwise they are reported as the present value of the
in foreign currencies are recognised in the statement of financial        estimated future cash flows.
Performance.
                                                                          (s) Contingent Assets and Contingent liabilities
Cash and cash equivalents include cash on hand, cash in transit,           Contingent assets and contingent liabilities are recorded in
bank accounts and deposits with a maturity of no more than three          the Notes to the financial statements at the point at which the
months from date of acquisition                                           contingency is evident. Contingent liabilities are disclosed if the
                                                                          possibility that they will crystallise is not remote. Contingent assets
The fair value of forward exchange contracts is calculated by             are disclosed if it is probable that the benefits will be realised.
reference to current forward exchange rates for contracts with
similar maturity profiles.                                                (t) segment reporting
                                                                           Tourism New Zealand’s primary function is to market New Zealand
(r) employee benefits                                                     as a tourism destination. To achieve this, Tourism New Zealand
Pension liabilities. obligations for contributions to defined             maintains offices in a number of overseas countries. However,
contribution retirement plans are recognised in the statement of          all Tourism New Zealand’s activities are co-ordinated from
financial Performance as they fall due.                                   New Zealand.


                                                                                              GROUP                          PARENT


  Note 2
  Crown revenue

                                                                                           2009           2008             2009            2008
                                                                                          $000s          $000s            $000s           $000s

  Crown revenue                                                                          70,301         70,301           70,301         70,301
  During the year, additional funding was provided by the Crown for the following:
  China                                                                                   4,025          3,025            4,025          3,025
  Australia                                                                               2,812               0           2,812                0
  Qualmark New Zealand ltd                                                                  844            529              844             529
  rugby world Cup                                                                              0         2,925                 0         2,925
  Total revenue received from the Crown                                                  77,982         76,780           77,982         76,780
  less GsT                                                                                1,731          1,709            1,731           1,709
  Net revenue received from the Crown                                                   76,251          75,071           76,251         75,071


  Note 3
  Other revenue

                                                                                           2009           2008             2009            2008
                                                                                          $000s          $000s            $000s           $000s

  sales                                                                                   2,483          2,283                  1              7
  Partnership income                                                                      2,992          4,610            2,992           4,610
  Gain on sale of property, plant and equipment                                                3             13                3             13
  Total other revenue                                                                     5,478          6,906            2,996          4,630
34   fINANCIAl sTATemeNTs                                                                 // TourIsm ANNuAl rePorT // 2008 – 2009




                                                                                  GROUP                       PARENT


          Note 4
          Foreign exchange gains

                                                                                2009       2008             2009            2008
                                                                                $000s      $000s           $000s           $000s

          Gains on derivative financial instruments                               20       4,040               20          4,040
          foreign exchange gains                                               5,908      3,959            5,908          3,959
          Total foreign exchange gains                                          5,928      7,999           5,928           7,999


          Note 5
          Other expenses include:

                                                                                2009       2008             2009            2008

          Personnel expenses
          Number of permanent and fixed term staff                               139        138              126             124



                                                                                2009       2008             2009            2008
                                                                                $000s      $000s           $000s           $000s

          salaries and wages                                                   12,332     12,062          11,342          11,081
          employer superannuation contributions                                  229        213              212             203
          Increase/(decrease) in employee entitlements (note 16)                 213        150              209             137
          other personnel expenses                                               905      1,490              905          1,432
                                                                               13,679     13,915         12,668          12,853



                                                                                 2009       2008            2009            2008
                                                                                $000s      $000s           $000s           $000s

          Personnel costs for New Zealand and offshore staff were:
          New Zealand Personnel expenses – Tourism New Zealand                  6,924      7,130           6,924           7,130
          New Zealand Personnel expenses – subsidiaries                         1,011     1,062                 0               0
          offshore Personnel expenses                                           5,744     5,723            5,744          5,723
                                                                               13,679     13,915         12,668          12,853


                                                                                2009       2008             2009            2008

          Number of ceased staff paid compensation or other benefits                3          4                2               4

                                                                                 2009       2008            2009            2008
                                                                                $000s      $000s           $000s           $000s

          Compensation or other benefits paid to ceased staff                    232         46              205              46



                                                                                 2009       2008            2009            2008
                                                                                $000s      $000s           $000s           $000s

          Auditor's remuneration
          Amounts received or due and receivable by Ernst & Young
          New Zealand for:
          The audit of the financial report of the Tourism New Zealand Group      80         81                71             70
          other services                                                          35         39                35             39
                                                                                 115        120              106             109
          Amounts received or due and receivable by auditors
          other than Ernst & Young New Zealand for:
          The audit of the financial report of subsidiary entities                  4          5                0               0
                                                                                 119        125              106             109
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                               fINANCIAl sTATemeNTs   35



Note 5 continued

                                                                                       GROUP                          PARENT

                                                                                     2009           2008          2009              2008
                                                                                    $000s          $000s         $000s             $000s

   Other expenses
   loss on disposal of property, plant and equipment                                   11              156             11              156
   lease expense                                                                   2,335          2,360          2,165            2,206
   remuneration of board members of Parent (see also note 30)                           –                 –          221               204


   Note 6
   Foreign exchange losses

                                                                                    2009               2008          2009              2008
                                                                                    $000s          $000s         $000s             $000s

   Foreign exchange losses
   losses on derivative financial instruments                                       2,982                20      2,982                   20
   foreign exchange losses                                                         5,709          2,457          5,709            2,457
   Total foreign exchange losses                                                   8,691          2,477          8,691            2,477


   Note 7
   Total expenditure of parent

                                                                                                                     2009              2008
                                                                                                                 $000s             $000s

   Total expenditure by geographic region:
       Australia                                                                                               12,882            10,199
       North America                                                                                             9,328             9,674
       uK & europe                                                                                             13,960            14,614
       Japan                                                                                                     3,021            5,849
       Asia                                                                                                      9,736            8,599
       other markets                                                                                                  26               112
       New Zealand (a)                                                                                         32,625           32,840
                                                                                                               81,578            81,887
   foreign exchange losses                                                                                       8,691            2,477
   Total expenditure of Parent                                                                                 90,269           84,364


   (a) New Zealand expenditure includes costs that apply to all markets and across a number of campaigns including
   the 100% Pure New Zealand Campaign, the International media Programme and the newzealand.com website.



                                                                                                                     2009              2008
                                                                                                                 $000s             $000s

   Total expenditure by the three strategic categories outlined
   in the Statement of Service Performance:
       Campaign                                                                                                49,090           48,228
       Channel                                                                                                 16,337            16,622
       Capability                                                                                              24,842            19,514
   Total expenditure of Parent                                                                                 90,269           84,364


   Note 8
   Subsidiary companies

                                                                                       Interest Held                   Interest Held
                                                                                    2009               2008          2009              2008

   Qualmark New Zealand limited                                                      60%               60%           60%               60%
   Visitor Information Network Incorporated (trading as i-sITe NZ)                    0%                0%            0%                0%
36   fINANCIAl sTATemeNTs                                                                                        // TourIsm ANNuAl rePorT // 2008 – 2009




       Note 8 continued

                                                                                                      GROUP                          PARENT


          The financial year-end of both subsidiaries is 30 June.

          Tourism New Zealand has a 60% shareholding in Qualmark New Zealand limited with the other 40% held by the New Zealand
          Automobile Association. Tourism New Zealand has control of Visitor Information Network Incorporated (VIN Inc), trading as i-sITe
          New Zealand, effective 21 August 2002.

          Qualmark New Zealand limited is New Zealand Tourism’s official quality agency. It is a government – private sector partnership
          between Tourism New Zealand and New Zealand Automobile Association. Qualmark licenses professional and trustworthy
          New Zealand tourism businesses to use the Qualmark® – tourism’s official quality mark – to help international and domestic travellers
          select places to stay, things to do and ways to get around.

          Qualmark’s core activities are based around determining the eligibility of businesses to enter the licensing system. This is achieved by
          way of assessment, promoting and working with Qualmark® licensees and working closely with other organisations and sectors within
          the tourism industry. by doing so, quality standards are raised and New Zealand tourism businesses improved based on best-practice.

          The assets, liabilities, revenue and deficit/surplus of Qualmark New Zealand which are included in the financial statements are as follows:



                                                                                                   2009           2008             2009            2008
                                                                                                  $000s          $000s            $000s           $000s

          Current assets                                                                              63             80                 -               -
          Non-current assets                                                                        144            222                  -               -
                                                                                                    207            302                  -               -


          Current liabilities                                                                       338            404                  -               -
          Non-current liabilities                                                                      0              0                 -               -
                                                                                                    338            404                  -               -
          Net assets                                                                               (131)          (102)                 -               -


          revenue                                                                                 3,261          2,990                  -               -
          surplus/(deficit)                                                                         (29)             47                 -               -


          Tourism New Zealand and i-sITe New Zealand have a relationship agreement that recognises the importance of having an effective
          and high quality network of visitor information centres dedicated to delivering free, comprehensive and objective information. The
          terms and conditions of the relationship agreement mean that Tourism New Zealand meets the criteria determined in NZ Ifrs 3 for
          consolidating investments in subsidiaries.

          The i-sITe brand creates a distinctive look, which distinguishes the official network from other information centres. The i-sITe Visitor
          Centres provide on-the-ground information to ensure the visitor experience is as enjoyable as possible.

          The assets, liabilities, revenue and deficit/surplus of Visitor Information Network Incorporated which are included in the financial
          statements are as follows:



                                                                                                   2009           2008             2009            2008
                                                                                                  $000s          $000s            $000s           $000s



          Current assets                                                                            202            120                  -               -
          Non-current assets                                                                           0              0                 -               -
                                                                                                    202            120                  -               -


          Current liabilities                                                                       138              70                 -               -
          Non-current liabilities                                                                      0              0                 -               -
                                                                                                    138              70                 -               -
          Net assets                                                                                  64             50                 -               -


          revenue                                                                                   838            841                  -               -
          (deficit)/surplus                                                                           13           (61)                 -               -
// TourIsm ANNuAl rePorT // 2008 – 2009                                                                            fINANCIAl sTATemeNTs   37




                                                                                        GROUP                     PARENT


 Note 9
 Associate company

                                                                                      2009           2008       2009          2008
                                                                                     $000s          $000s       $000s         $000s

 The New Zealand way limited                                                              4                7        -               -


 The financial year-end of The New Zealand way limited is 30 June.

 Tourism New Zealand has a 50% shareholding in The New Zealand way limited. This Company is the operating entity of a joint
 venture between Tourism New Zealand and New Zealand Trade & enterprise.

 The New Zealand way brand provides marketing opportunities to those companies which meet quality and environmental standards.
 The brand is promoted as a mark of outstanding quality, superior service and unique New Zealand characteristics.

 There were no impairment losses relating to the investment in associate and no capital commitments or other commitments relating
 to the associate.

 The following table illustrates summarised information of the investment in The New Zealand way limited:



                                                                                      2009           2008       2009          2008
                                                                                     $000s          $000s       $000s         $000s

 Share of associate's balance sheet:
 Current assets                                                                           6               10        -               -
 Current liabilities                                                                      3                3        -               -
 Net assets                                                                               3                7        -               -


 Share of associate's revenue and (deficit)/surplus:
 revenue                                                                                  0                0        -               -
 (deficit)/surplus                                                                      (3)               (3)       -               -


 Carrying amount at beginning of year                                                     7               10        -               -


 Carrying amount at end of year                                                           4                7        -               -


 Note 10
 Cash

                                                                                      2009           2008       2009          2008
                                                                                     $000s          $000s       $000s         $000s

 Cash Holdings:
 Cash at bank and in hand                                                             1,156         1,488       1,065         1,365
 Call accounts – foreign currencies                                                  1,879          2,265       1,879         2,265
 Call accounts – New Zealand dollar                                                    782          1,447        702          1,447
                                                                                     3,817          5,200       3,646         5,077


 Cash at bank and in hand generally earns interest at floating rates based on daily bank deposit rates.

 Call account deposits are made depending on the immediate cash requirements of the Group, and earn interest at the respective
 money market call rates.
38   fINANCIAl sTATemeNTs                                                                                 // TourIsm ANNuAl rePorT // 2008 – 2009




       Note 10 continued

                                                                                                GROUP                         PARENT

                                                                                             2009           2008            2009            2008
                                                                                            $000s          $000s           $000s           $000s

          Cash Holdings by Currency:
          New Zealand dollar                                                                 1,138         2,181              967          2,058
          united states dollar                                                                 214           336              214            336
          british Pound                                                                         94           677                94           677
          Australian dollar                                                                   909            287              909            287
          european euro                                                                        412           359              412            359
          Japanese Yen                                                                          78           210                78           210
          singapore dollar                                                                     403           707              403            707
          Canadian dollar                                                                      349           203              349            203
          Indian rupee                                                                         107           171              107            171
          other Asian Currencies                                                               113            69              113              69
                                                                                             3,817         5,200            3,646          5,077
          Cash Holdings by Bank:
          HsbC bank                                                                          2,971         3,020            2,821          2,986
          National bank of New Zealand                                                          48           736                48           736
          bank of New Zealand                                                                  730         1,253              709          1,164
          deutsche bank                                                                          0            91                 0             91
          Tokyo mitsubishi                                                                      68           100                68           100
                                                                                             3,817         5,200           3,646           5,077


          The fair value of cash and cash equivalents is $3,817,000 (2008: $5,200,000).


          Note 11
          Receivables

                                                                                             2009           2008            2009            2008
                                                                                            $000s          $000s           $000s           $000s

          receivables                                                                          575         1,331              528          1,289
          less: Provision for impairment                                                       (16)           (7)             (11)             (3)
                                                                                               559         1,324              517          1,286


          Trade receivables are non-interest bearing and are generally on 30-day terms. The carrying value of receivables approximates their
          fair value. As at 30 June 2009 and 2008, all overdue receivables have been assessed for impairment and appropriate provisions
          applied, as detailed below:


                                                                                                PARENT
                                                                            2009                                         2008

                                                                 Gross     Impairment          Net           Gross      Impairment            Net

          Parent                                                $000s          $000s         $000s          $000s           $000s          $000s

          Not past due                                            425              0           425           1,219               0         1,219
          Past due 1 – 30 days                                      47             0            47                  1            0              1
          Past due 31 – 60 days                                     34              0           34              55               0             55
          Past due 61 – 90 days                                      0              0            0                  2            0              2
          Past due > 91 days                                        22           (11)           11              12              (3)             9
                                                                  528            (11)          517           1,289              (3)        1,286
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                               fINANCIAl sTATemeNTs   39



Note 11 continued

                                                                                        GROUP
                                                                    2009                                       2008

                                                          Gross    Impairment          Net           Gross    Impairment            Net

   Group                                                $000s          $000s        $000s           $000s         $000s          $000s

   Not past due                                            482             0          482           1,215               0        1,215
   Past due 1 – 30 days                                     44             0            44             27               0           27
   Past due 31 – 60 days                                    27             0            27             56               0           56
   Past due 61 – 90 days                                     3             0             3             19               0           19
   Past due > 91 days                                       19           (16)            3             14              (7)             7
                                                           575           (16)         559           1,331              (7)       1,324


   The provision for impairment has been calculated based on expected losses determined by an analysis of losses in previous periods
   and a review of specific debtors.

   receivables for the Group include GsT/VAT refunds comprising 61% (46% in 2008) of total receivables as follows:


                                                                                       GROUP                          PARENT

                                                                                     2009          2008              2009         2008
                                                                                    $000s         $000s           $000s          $000s

   GsT refund due from NZ Inland revenue department                                   298           536              298           523
  GsT refund due from Australian Taxation office                                       29            32                29           32
  VAT refund due from uK Customs & excise                                               21           38                21           38
                                                                                      348           606              348           593


   Note 12
   derivative financial instruments


   Tourism New Zealand uses foreign exchange instruments in order to manage its exposure to fluctuations in foreign currency exchange
   rates on normal operating activities. The instruments are matched with anticipated future cash flows in foreign currencies. Tourism
   New Zealand does not use financial instruments for speculative purposes. At balance date Tourism New Zealand had 28 (2008:
   36) foreign exchange contracts maturing at various dates over the next 12 months. The contracts are designated as held for trading
   financial instruments with fair value gains or losses recognised in the statement of financial Performance.


   Foreign currency forward exchange contracts:

                                                                                     2009          2008              2009         2008
                                                                                    $000s         $000s           $000s          $000s

   foreign exchange contracts at 30 June – sell Value                              37,550        35,800          37,550        35,800
   fair value derivatives in Gain                                                        0         1,514                0        1,514
   fair value derivatives in loss                                                  (1,469)          (20)        (1,469)           (20)
   foreign exchange contracts at 30 June                                           36,081        37,294         36,081          37,294


   Foreign exchange contracts by currency:
   united states dollar                                                            10,178        12,303          10,178        12,303
   british Pound                                                                    5,921         8,044           5,921          8,044
   Australian dollar                                                               11,013         9,959          11,013          9,959
   european euro                                                                    4,706         2,156           4,706          2,156
   Japanese Yen                                                                     3,162         2,842           3,162          2,842
   Canadian dollar                                                                   1,101        1,990           1,101          1,990
                                                                                   36,081        37,294         36,081          37,294
40   fINANCIAl sTATemeNTs                                                // TourIsm ANNuAl rePorT // 2008 – 2009




                                                                GROUP                        PARENT


          Note 13
          Property plant and equipment

                                                              2009        2008             2009            2008
                                                             $000s       $000s            $000s           $000s

          All property plant and equipment
          At cost                                            6,085       5,843            5,669           5,419
          Accumulated depreciation                          (3,845)     (3,678)         (3,573)         (3,476)
          Net carrying amount of furniture and fittings      2,240       2,165            2,096           1,943

          Property plant and equipment for each class:

          furniture and fittings
          At cost                                            1,173         997             1,132            959
          Accumulated depreciation                           (458)       (327)             (421)          (292)
          Net carrying amount of furniture and fittings        715         670               711            667

          leasehold improvements
          At cost                                            1,961       1,654            1,851           1,544
          Accumulated depreciation                          (1,088)      (882)             (978)          (772)
          Net carrying amount of leasehold improvements        873         772              873             772

          office equipment
          At cost                                              624         609              624             609
          Accumulated depreciation                           (498)       (447)             (498)          (447)
          Net carrying amount of office equipment              126         162              126             162

          motor vehicles
          At cost                                               61         112                61            112
          Accumulated depreciation                             (30)        (61)             (30)            (61)
          Net carrying amount of motor vehicles                 31           51               31              51

          Computer equipment
          At cost                                            2,266       2,471            2,001           2,195
          Accumulated depreciation                          (1,771)     (1,961)          (1,646)        (1,904)
          Net carrying amount of computer equipment            495         510              355             291
          Total property plant and equipment                 2,240       2,165            2,096           1,943

          All property plant and equipment reconciliation

          At 1 July, net of accumulated depreciation         2,165       1,616            1,943           1,609
          Additions                                            854       1,348              851           1,110
          disposals                                            (18)       (174)             (18)           (174)
          depreciation charge for the year                    (761)      (625)            (680)           (602)
          At 30 June, net of accumulated depreciation        2,240       2,165            2,096           1,943

          depreciation by asset class:
              furniture and fittings                           140         108              138             106
              leasehold improvements                           254         173              254             173
              office equipment                                  56          89                56             89
              motor vehicles                                    12           12               12             12
              Computer equipment                               299         243              220             222
          Total depreciation                                   761         625              680             602
// TourIsm ANNuAl rePorT // 2008 – 2009                                                                                fINANCIAl sTATemeNTs   41




                                                                                       GROUP                         PARENT


 Note 14
 Accommodation bonds


 Accommodation bonds are refundable deposits or key money paid for the lease of office and housing premises.


                                                                                     2009          2008            2009            2008
                                                                                    $000s         $000s           $000s            $000s

 uK & europe                                                                             0             9               0               9
 Japan                                                                                177            155             177            155
 Asia                                                                                  317           179             317            179
                                                                                      494            343             494            343


 Note 15
 Creditors and other payables


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


                                                                                     2009          2008            2009             2008
                                                                                    $000s         $000s           $000s            $000s

 Creditors                                                                            595          1,426             478           1,301
 Accrued expenses                                                                   3,071          2,852           2,847           2,592
                                                                                    3,666          4,278           3,325           3,893


 Note 16
 Employee entitlements

                                                                                     2009          2008            2009            2008
                                                                                    $000s         $000s           $000s            $000s

 Annual leave                                                                         551            430             511            394
 retirement leave                                                                     575            437             575            437
 long service leave                                                                      2            58               2             58
 sick leave                                                                             12             2              12               2
                                                                                     1,140           927           1,100            891


 Note 17
 Provisions


 Tourism New Zealand has a number of potential future restoration costs relating to make good clauses on office rental leases.
 The Provision recognises the present value of expected future payments for amounts in relation to make good. The provision relates
 to seven Tourism New Zealand offices and is expected to be incurred over the next 12 years.


                                                                                     2009          2008            2009            2008
                                                                                    $000s         $000s           $000s            $000s

 Provisions are represented by:
 lease make-good                                                                      303            303            303             303
 Total Provisions                                                                     303            303            303             303


 Movements in the lease make-good is as follows:
 balance at 1 July                                                                    303            220            303             220
 Additional provisions made                                                             20           165              20            165
 Amounts used                                                                         (12)          (82)            (12)            (82)
 unused amounts reversed                                                               (8)             0              (8)              0
 balance at 30 June                                                                   303            303            303             303
42   fINANCIAl sTATemeNTs                                                                                   // TourIsm ANNuAl rePorT // 2008 – 2009




                                                                                                 GROUP                          PARENT


          Note 18
          Reconciliation of surplus/(deficit) to net cash from operating activities

                                                                                               2009          2008             2009            2008
                                                                                              $000s         $000s            $000s           $000s



          Net operating surplus/(deficit)                                                   (4,728)         4,029           (4,712)          4,043


          Add/(less) non-cash items
          depreciation and impairment                                                           761           624              680             602
          Net (gains) on derivative financial instruments                                       (20)       (4,040)             (20)        (4,040)
          Net losses on derivative financial instruments                                      2,982             20           2,982               20
          Net foreign exchange (gains)/losses                                                   317          (149)              317          (149)
          Total non-cash items                                                                4,040        (3,545)           3,959         (3,567)


          Add/(less) items classified as investing or financing activities


          Net loss/(Gain) on disposal of assets                                                    8          143                 8            143
          Net loss/(Gain) on foreign currency accomodation bonds                                (18)          (23)             (18)            (23)
          Total items classified as investing or financing activities                           (10)          120              (10)            120


          Add/(less) movements in working capital items
          debtors and other receivables                                                         752          (150)             769            (151)
          Prepayments                                                                           413         1,869               415          1,866
          Payables & accruals                                                                 (621)           626             (595)            453
          Provisions                                                                               0            83                0              83
          Income in advance                                                                    (176)             0            (203)               0
          employee entitlements                                                                 212           150              209             137
          Net movements in working capital items                                                580         2,578              595           2,388
          Net cash from operating activities                                                   (118)        3,182             (168)          2,984


          Note 19
          Contingent liabilities and contingent assets



          Tourism New Zealand has provided a written undertaking to the board of Qualmark New Zealand ltd to provide ongoing financial
          support sufficient to enable Qualmark to meet its obligations when they fall due. Tourism New Zealand has assessed the likelihood
          of being required to significantly increase the level of funding to Qualmark as low. Additionally Tourism New Zealand’s shareholding
          in Qualmark is uncalled. If called, Tourism New Zealand would be liable to contribute $60,000. other than this undertaking, and
          uncalled capital in Qualmark, there are no known contingencies for the Group or Parent as at 30 June 2009 (2008: Nil).


          Note 20
          Income tax



          Tourism New Zealand is exempt from income tax under the New Zealand Tourism board Act 1991. Tourism New Zealand’s
          subsidiaries are subject to income tax. The Group has tax losses unrecognised that can be used to offset future assessable
          income of $312,447 (2008: $220,854)
// TourIsm ANNuAl rePorT // 2008 – 2009                                                                                   fINANCIAl sTATemeNTs   43




 Note 21
 Management of risk



 Tourism New Zealand has developed a risk management framework and has undertaken a full risk assessment of its business.
 management is required to sign off on a half yearly basis that no new exposures have arisen and that existing risks are being properly
 managed. written policies and procedures exist covering those aspects of business which have the potential to generate risk for
 Tourism New Zealand. Adherence to these policies minimises potential risk to Tourism New Zealand. employees are required as
 part of employment contracts to adhere to Tourism New Zealand policies and procedures.

 Tourism New Zealand carries comprehensive insurance covering all normal business risks including Public liability. Tourism
 New Zealand has purchased insurance to provide board members and officers liability, employers liability and Professional
 Indemnity cover for board members and employees. Tourism New Zealand also provides cover for its staff for off shore travel.
 Insured values are reviewed annually and adjusted to reflect changes in business operations.


 Note 22
 Significant accounting judgements, estimates and assumptions



 The preparation of the financial statements requires management to make judgements, estimates and assumptions that affect the
 reported amounts in the financial statements. management continually evaluates its judgements and estimates in relation to assets,
 liabilities, contingent liabilities, revenue and expenses. These judgements and estimates are based on historical experience and other
 factors that are reasonable under the circumstances and form the basis for the carrying values of assets and liabilities. Actual results
 may differ from these estimates under different assumptions and conditions.

 management has identified the following critical accounting policies for which significant judgements, estimates and assumptions
 have been made.

 Make good provision

 A provision has been made for a number of potential future restoration costs relating to make good clauses on seven office rental
 leases. The calculation of this provision requires assumptions such as the extent, if any, that landlords will enforce the make good
 clauses in the leases and building and demolition cost estimates. These uncertainties may result in future actual expenditure differing
 from the amounts currently provided. The provision recognised for each lease is periodically reviewed and updated based on the
 facts and circumstances available at the time. Changes to the estimated future costs for make good are recognised in the balance
 sheet by adjusting both the expense or asset and provision. The related carrying amounts are disclosed in note 17.

 Retirement and long service leave

 The present value of the retirement and long service leave obligations (Note 16) depends on a number of factors that are determined
 on an actuarial basis using a number of assumptions. Two key assumptions used in calculating this liability include the discount rate
 and the salary inflation factor.

 In determining the appropriate discount rate Tourism New Zealand considered the interest rates on NZ government bonds which
 have terms to maturity that match, as closely as possible, the estimated future cash outflows. The salary inflation factors have been
 determined after considering historical salary inflation patterns and long term inflation assumptions in the countries concerned.

 Any changes in these assumptions will impact on the carrying amount of the liability.


 Note 23
 Capital management



 Tourism New Zealand’s capital is its equity, which comprises accumulated funds and other reserves. equity is represented by
 net assets.

 Tourism New Zealand is subject to the financial management and accountability provisions of the Crown entities Act 2004, which
 impose restrictions in relation to borrowings, acquisition of securities, issuing guarantees and indemnities and the use of derivatives.

 Tourism New Zealand manages its equity as a by-product of prudently managing revenues, expenses, assets, liabilities, investments
 and general financial dealings to ensure that Tourism New Zealand effectively achieves its objectives and purpose, whilst remaining a
 going concern.
44   fINANCIAl sTATemeNTs                                                                                     // TourIsm ANNuAl rePorT // 2008 – 2009




                                                                                                   GROUP                          PARENT


          Note 24
          Categories of financial assets and liabilities



          The carrying amounts of financial assets and liabilities in each of the NZ IAs 39 categories are as follows:



                                                                                                2009           2008             2009            2008
                                                                                               $000s          $000s            $000s           $000s



          Financial assets:
          Cash and cash equivalents                                                             3,817         5,200            3,646           5,077
          debtors and other receivables                                                          559          1,324               517          1,286
          Total loans and receivables                                                          4,376          6,524            4,163           6,363


          Fair value through profit and loss:
          derivative financial instrument assets                                                    0         1,514                 0          1,514
          derivative financial instrument liabilities                                          1,469             20            1,469              20


          Other liabilities:
          Creditors and other payables                                                         3,666          4,278            3,325           3,893
          Income in advance                                                                      160            335               107            310
          Total other liabilities                                                              3,826          4,613            3,432           4,203


          Note 25
          Capital commitments

                                                                                                2009           2008             2009            2008
                                                                                               $000s          $000s            $000s           $000s

          Total capital expenditure contracted for at balance
          date but not provided for in the financial statements                                    24              0               24               0
// TourIsm ANNuAl rePorT // 2008 – 2009                                                                                 fINANCIAl sTATemeNTs   45




                                                                                        GROUP                         PARENT


 Note 26
 Operating commitments



 operating commitments include non-cancellable lease payments for premises, motor vehicles and office equipment
 and non-cancellable contracts for services like equipment maintenance and public relations.



                                                                                      2009          2008            2009             2008
                                                                                     $000s         $000s           $000s            $000s

 operating Commitments payable after balance date on:


 Non-Cancellable Accommodation Leases:
 up to one Year                                                                      2,159         2,095            2,085            2,020
 one to Two Years                                                                    1,340          1,698           1,340            1,698
 Two to five Years                                                                   2,282         2,866            2,282           2,866
 over five Years                                                                     3,409          4,108           3,409            4,108
                                                                                     9,190        10,767            9,116           10,692
 Non-Cancellable Motor Vehicle & Equipment Leases
 up to one Year                                                                        246           286              170             210
 one to Two Years                                                                      135            230             105             154
 Two to five Years                                                                      92            159              82             131
 over five Years                                                                          0             0               0               0
                                                                                       473            675             357             495
 Non-Cancellable Contracts for Goods & Services
 up to one Year                                                                        227            107             227             107
 one to Two Years                                                                        13             0              13               0
 Two to five Years                                                                        0             0               0               0
 over five Years                                                                          0             0               0               0
                                                                                       240            107             240             107
 Total Commitments                                                                   9,903        11,549            9,713           11,294


 Note 27
 Related party transactions



 Tourism New Zealand is a wholly owned entity of the Crown which has the abiity to significantly influence its role. The Crown is
 Tourism New Zealand’s major source of revenue.

 Tourism New Zealand enters into transactions with government departments, state-owned enterprises and other Crown entities.
 Those transactions that occur within a normal supplier or client relationship on terms and conditions no more or less favourable than
 those which it is reasonable to expect Tourism New Zealand would have adopted if dealing with that entity at arm’s length in the same
 circumstances have not been disclosed as related party transactions.

 Tourism New Zealand also enters into transactions with its subsidiaries and associate. These transactions occur within a normal
 supplier or client relationship on terms and conditions no more or less favourable than those which it is reasonable to expect
 Tourism New Zealand would have adopted if dealing with that entity at arm’s length. The following table provides the total amount
 of transactions that were entered into with these related parties.
46   fINANCIAl sTATemeNTs                                                                                   // TourIsm ANNuAl rePorT // 2008 – 2009




       Note 27 continued

                                                                                             Transaction value              Balance outstanding
                                                                                            year ended 30 June              year ended 30 June

                                                                                              2009           2008             2009            2008
                                                                                             $000s          $000s            $000s           $000s

          Related Party and Transaction
          subsidiary – Qualmark New Zealand limited:
              shareholder income provided by Tourism New Zealand                              1,141         1,046                 0                0
              Purchases from Tourism New Zealand                                                100               52             42               28
              sales to Tourism New Zealand                                                        2                0              0                0
          subsidiary – Visitor Information Network Inc:
              shareholder income provided by Tourism New Zealand                               500               500              0                0
              sales to Tourism New Zealand                                                        0                0              0                0
              Purchases from Tourism New Zealand                                                  0                5              0                0
          Associate – The New Zealand way limited:
              shareholder income provided by Tourism New Zealand                                  0                0              0                0


          Tourism New Zealand also enters into transactions with board members and entities over which they have control or significant
          influence. These transactions occur within a normal supplier or client relationship on terms and conditions no more or less favourable
          than those which it is reasonable to expect Tourism New Zealand would have adopted if dealing with that entity at arm’s length.
          The following table provides the total amount of transactions that were entered into with these related parties.


                                                                                             Transaction value              Balance outstanding
                                                                                            year ended 30 June              year ended 30 June

                                                                                              2009           2008             2009            2008
                                                                                             $000s          $000s            $000s           $000s

          Related Party and Transaction
          Income has been received by Tourism New Zealand from:
          G Coughlan (Chair): Positively wellington Tourism – Income received by
          TNZ for joint advertising campaigns and other tourism related services.               102              441              0                0
          P bingham (director): Air New Zealand limited and Christchurch &
          Canterbury Convention bureau ltd. (Chair): Christchurch & Canterbury
          marketing ltd – Income received by TNZ for joint advertising campaigns
          and other tourism related services.                                                    44              767              5                0
          m Johns (Chief executive): Intercity Group (NZ) limited – Income received
          by TNZ for tourism related services.                                                   11                0              0                0
          P richardson (Vice President): Accor Hospitality NZ and fiji – Income
          received by TNZ for tourism related services.                                           7                0              0                0
          J barrett (director): Aviation/Tourism/Travel Training organisation (ATTTo)
          – Income received by TNZ for tourism related services.                                  5                0              0                0


          Payments have been made by Tourism New Zealand to:
          P bingham (director): Air New Zealand ltd. (Chair): Christchurch &
          Canterbury marketing ltd – Provision of travel and tourism related services
          to TNZ.                                                                             1,301                3             23                0
          P richardson (director): Tourism Industry Association – Provision of
          tourism related services to TNZ.                                                      157                0              0                0
          G muir (Non-executive Chairman): Pumpkin Patch ltd – reimbursement
          of travel.                                                                             12                0              0                0
          J barrett (managing director): Kapiti Island Alive & Kapiti Nature lodge.
          (director): Aviation/Tourism/Travel Training organisation (ATTTo)
          – Provision of tourism related services to TNZ                                          6                3              0                0
          G Coughlan (Chair): Positively wellington Tourism – Provision of tourism
          related service to TNZ.                                                                 1               21              0                0
 // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                        fINANCIAl sTATemeNTs   47



Note 27 continued

  H van Asch (managing director): High Plains wine Co ltd. (director):
  Auckland bungy ltd – Provision of tourism related services to TNZ                             1               0                0                 0
  K Guy (director): bayview International Group of Hotels and resorts
  – Provision of conference and accomodation services to TNZ                                    0             76                 0                 0


                                                                                                                              PARENT
                                                                                                                             2009           2008

                                                                                                                            $000s          $000s

  Key management personnel compensation
  salaries and other short-term employee benefits                                                                           2,219          1,877
  Post-employment benefits                                                                                                       0                 0
  other long-term benefits                                                                                                     61              60
  Termination benefits                                                                                                           0                 0
  Total key management personnel compensation                                                                               2,280          1,937


  Key management personnel includes all board members, the Chief executive and the 7 (2008: 6) members of the executive Team.


  Note 28
  Financial instrument risks



  Tourism New Zealand’s activities expose it to a variety of financial instrument risks, including market risk, credit risk and liquidity
  risk. Tourism New Zealand has a series of policies to manage the risks associated with financial instruments and seeks to minimise
  exposure from financial instruments. These policies do not allow any transactions that are speculative in nature.

  market risk
  Fair value interest rate risk – fair value interest rate risk is the risk that the value of a financial instrument will fluctuate due to changes
  in market rates. Tourism New Zealand has no exposure to fair value interest rate risk as all bank deposits are held at call rates.

  Interest rate risk sensitivity analysis – As at 30 June 2009, if interest rates on bank deposits had increased/decreased by 0.5%
  (50 basis ponts) with all other variables held constant, the deficit would have changed as follows:

                                                                                            2009            2008             2009           2008
                                                                                           $000s           $000s            $000s          $000s

  If the interest rate had increased by 0.5% the deficit would have been
  lower by:                                                                                    10             19                 9             19
  If the interest rate had decreased by 0.5% the deficit would have been
  higher by:                                                                                   10             19                 9             19


  Currency risk – Currency risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes
  in foreign exchange rates.

  As a result of significant operations around the world, Tourism New Zealand is required to enter into transactions denominated in
  foreign currencies. As a result of these activities, exposure to currency risk arises.

  It is Tourism New Zealand’s policy to manage foreign currency risks arising from contractual commitments and liabilities by entering
  into foreign exchange forward contracts to cover the foreign currency exposure.

  Currency risk sensitivity analysis – Tourism New Zealand is subject to volatility in financial performance associated with foreign
  currency rates, especially when recognising fair value movements associated with forward foreign exchange contracts. As at 30 June
  2009, if the NZ dollar had increased/decreased by 5% against the basket of foreign currencies used by Tourism New Zealand with all
  other variables held constant, the deficit would have changed as follows:

                                                                                            2009            2008             2009           2008
                                                                                           $000s           $000s            $000s          $000s

  If the NZ dollar had decreased by 5% the deficit would have been lower by:               1,895           2,056            1,895          2,056
  If the NZ dollar had increased by 5% the deficit would have been higher by:               1,715          1,860            1,715          1,860


  This movement is attributable to foreign exchange gains/losses on translation of forward foreign exchange contracts and other foreign currency
  denominated assets and liabilities.
48   fINANCIAl sTATemeNTs                                                                                     // TourIsm ANNuAl rePorT // 2008 – 2009




       Note 28 continued

          Credit risk
          Credit risk is the risk that a third party will default on its obligations to Tourism New Zealand, causing Tourism New Zealand to
          incur a loss.

          Tourism New Zealand has no significant concentrations of credit risk, as it has a small number of credit customers and only places
          funds with registered banks. with respect to foreign exchange instruments, Tourism New Zealand reduces its risk by limiting the
          counter parties to major trading banks and does not expect to incur any significant losses as a result of non performance by these
          counter parties.

          Tourism New Zealand’s maximum credit exposure for each class of financial instrument is represented by the total carrying amount
          of cash (note 10), net debtors (note 11) and derivative financial instruments (note 12). There is no collateral held as security against
          these financial instruments, including those instruments that are overdue or impaired.

          liquidity risk
          liquidity risk is the risk that Tourism New Zealand will encounter difficulty raising liquid funds to meet commitments as they fall due.

          Tourism New Zealand has no significant concentrations of liquidity risk. Tourism New Zealand annually agrees a funding schedule
          with the Crown which matches the estimated timing of its commitments and close out of market positions.


          Note 29
          Remuneration of employees



          during 2008/2009 34 (2008: 32) employees received remuneration and benefits which exceeded $100,000 per annum as follows:


                                                                                                                                  PARENT
          $                                                                                                                     2009            2008

          100,000 – 109,999                                                                                                         6                7
          110,000 – 119,999                                                                                                         6                5
          120,000 – 129,999                                                                                                         4                3
          130,000 – 139,999                                                                                                         2                2
          140,000 – 149,999                                                                                                         2                2
          150,000 – 159,999                                                                                                         2                1
          160,000 – 169,999                                                                                                         0                1
          170,000 – 179,999                                                                                                         1                0
          180,000 – 189,999                                                                                                         0                1
          200,000 – 209,999                                                                                                         2                2
          210,000 – 219,999                                                                                                         1                0
          240,000 – 249,999                                                                                                         1                2
          250,000 – 259,999                                                                                                         1                1
          260,000 – 269,999                                                                                                         1                1
          270,000 – 279,999                                                                                                         1                0
          280,000 – 289,999                                                                                                         1                1
          290,000 – 299,999                                                                                                         1                0
          300,000 – 309,999                                                                                                         0                2
          310,000 – 319,999                                                                                                         1                0
          390,000 – 399,999                                                                                                         0                1
          430,000 – 439,999                                                                                                         1                0
                                                                                                                                   34             32
                                                          Average remuneration of above employees                          $171,478        $170,514


          Note: A number of Tourism New Zealand employees are based offshore and are paid in local currency at appropriate remuneration
          levels within the respective countries. This remuneration has been translated at the exchange rates of forward exchange contracts
          used to cover this expenditure.
// TourIsm ANNuAl rePorT // 2008 – 2009                                                                     fINANCIAl sTATemeNTs   49




                                                                                                          PARENT


 Note 30
 Remuneration of board members

                                                                                                         2009          2008
                                                                                                        $000s         $000s

 board members earned the following fees during the year:


 G muir (Chair)                                                                                            58               0
 s Johnstone (deputy Chair)                                                                                25              25
 P bingham                                                                                                 20              20
 G Coughlan                                                                                                20              20
 J barrett                                                                                                 20              20
 m Johns                                                                                                   20              20
 H van Asch                                                                                                17               0
 J langley                                                                                                  4               0
 P richardson                                                                                               4               0
 s murray                                                                                                  15              20
 K mcKelvie                                                                                                15              20
 K Guy                                                                                                      3              20
 w stone                                                                                                    0              39
                                                                                                          221             204


 Changes in board members: G muir was appointed Chairman on 15 July 2008. K Guy resigned as a board member on 14 August
 2008 and s murray and K mcKelvie’s terms expired 30 march 2009. Henry van Asch was appointed as a board member on
 1 september 2008 and P richardson and J langley were appointed as board members on 10 April 2009.
50   fINANCIAl sTATemeNTs                                                                                                                 // TourIsm ANNuAl rePorT // 2008 – 2009




       Five Year Financial Summary for Parent

          statement of financial Position
                                                                                           2005                  2006                  2007                  2008                  2009
                                                                                          Actual                Actual                Actual                Actual                Actual
                                                                                          $000s                 $000s                 $000s                 $000s                 $000s



          Current Assets
          Cash                                                                            6,673                 6,086                 3,272                 5,077                 3,646
          receivables                                                                     1,133                   882                 1,135                 1,286                    517
          Prepayments & other current assets                                                600                    275                2,884                 1,018                    603
          derivative financial instruments                                                       -                     -                    0                1,514                      0
                                                                                          8,406                 7,243                 7,291                 8,895                 4,766
          Non-current Assets
          Property plant and equipment                                                    1,223                 1,469                 1,609                 1,943                 2,096
          Accommodation bonds                                                                228                  340                    275                   343                   494
                                                                                          1,451                 1,809                 1,884                 2,286                 2,590
          Total Assets                                                                    9,857                 9,052                 9,175                11,181                 7,356
          Current liabilities
          Creditors and other payables                                                    4,614                 4,389                 3,954                 4,203                 3,432
          Provisions                                                                            0                     0                  220                   303                   303
          employee entitlements                                                             333                    357                   754                   891                1,100
          derivative financial instruments                                                       -                     -              2,526                     20                1,469
                                                                                          4,947                 4,746                 7,454                  5,417                6,304
          Total liabilities                                                               4,947                 4,746                 7,454                  5,417                6,304
          Net Assets                                                                      4,910                 4,306                 1,721                 5,764                 1,052
          Equity
          shareholder's equity                                                            1,805                 1,805                 1,805                 1,805                 1,805
          retained earnings                                                               3,105                 2,501                   (84)                3,959                  (753)
          Total Equity                                                                    4,910                 4,306                 1,721                 5,764                 1,052



          statement of financial Performance
                                                                                           2005                  2006                  2007                  2008                  2009
                                                                                          Actual                Actual                Actual                Actual                Actual
                                                                                          $000s                 $000s                 $000s                 $000s                 $000s

          Revenue
          Government grants                                                             69,754                79,358                74,246                 75,071                76,251
          Interest                                                                           627                   745                   859                   707                   382
          other revenue                                                                     289                    474                4,243                 4,630                 2,996
          foreign exchange gains                                                                 -                     -              2,617                 7,999                 5,928
                                                                                        70,670                80,577                81,965                88,407                85,557
          Expenditure
          other expenses                                                                69,021                80,629                78,653                81,285                80,898
          depreciation & Impairment                                                         667                    552                   738                   602                   680
          foreign exchange losses                                                                -                     -               7,128                2,477                 8,691
                                                                                        69,688                 81,181               86,519                84,364                90,269
          Net Operating Surplus/(deficit)                                                   982                 (604)               (4,554)                 4,043               (4,712)

          The 2008 financial year was Tourism New Zealands first set of financial statements to be prepared in accordance with New Zealand International Financial Reporting Standards (NZ
          IFRS.) The comparative figures for 2007 have been restated accordingly to NZ IFRS. Note however that the comparatives figures from 2005 to 2006 in the above table have not
          been restated to NZ IFRS.
    // TourIsm ANNuAl rePorT // 2008 – 2009                                                                                       fINANCIAl sTATemeNTs   51




AUdIT REPORT
To THe reAders of New ZeAlANd TourIsm boArd ANd GrouP’s fINANCIAl sTATemeNTs
ANd sTATemeNT of serVICe PerformANCe for THe YeAr eNded 30 JuNe 2009


The Auditor-General is the auditor of the New Zealand Tourism board        performance. we assessed the results of those procedures in forming
(the board) and group. The Auditor-General has appointed me, Grant         our opinion.
Taylor, using the staff and resources of ernst and Young, to carry out
                                                                           Audit procedures generally include:
the audit on his behalf. The audit covers the financial statements and
statement of service performance included in the annual report of the      -   determining whether significant financial and management controls
board and group for the year ended 30 June 2009.                               are working and can be relied on to produce complete and
                                                                               accurate data;
Unqualified Opinion
In our opinion:                                                            -   verifying samples of transactions and account balances;

-     The financial statements of the board and group on pages             -   performing analyses to identify anomalies in the reported data;
      27 to 49:
                                                                           -   reviewing significant estimates and judgements made by members
      -    comply with generally accepted accounting practice in               of the board;
           New Zealand;
                                                                           -   confirming year-end balances;
      -    give a true and fair view of:
                                                                           -   determining whether accounting policies are appropriate and
           -   the board and group’s financial position as at                  consistently applied; and
               30 June 2009; and
                                                                           -   determining whether all financial statement and statement of
           -   the results of operations and cash flows for the
                                                                               service performance disclosures are adequate.
               year ended on that date.
                                                                           we did not examine every transaction, nor do we guarantee complete
-     The statement of service performance of the board and
                                                                           accuracy of the financial statements and statement of service
      group on pages 16 to 22:
                                                                           performance.
      -    complies with generally accepted accounting practice in
                                                                           we evaluated the overall adequacy of the presentation of information in
           New Zealand; and                                                the financial statements and statement of service performance. we
      -    gives a true and fair view of, for each class of outputs:       obtained all the information and explanations we required to support
                                                                           our opinion above.
           -   standards of delivery performance achieved, as compared
               with the forecast standards outlined in the statement of    Responsibilities of the Board members and the Auditor
               forecast service performance adopted at the start of the    The board members are responsible for preparing the financial
               financial year; and                                         statements and statement of service performance in accordance with
           -   actual revenue earned and output expenses incurred, as      generally accepted accounting practice in New Zealand. The financial
               compared with the forecast revenues and output expenses     statements must give a true and fair view of the financial position of the
               outlined in the statement of forecast service performance   board and group as at 30 June 2009 and the results of operations and
                                                                           cash flows for the year ended on that date. The statement of service
               adopted at the start of the financial year.
                                                                           performance must give a true and fair view of, for each class of outputs,
-     based on our examination the board and group kept proper             the board and group’s standards of delivery performance achieved and
      accounting records.                                                  revenue earned and expenses incurred, as compared with the forecast
                                                                           standards, revenue and expenses adopted at the start of the financial
The audit was completed on 29 october 2009, and is the date at
                                                                           year. The board member’s responsibilities arise from the financial
which our opinion is expressed.
                                                                           reporting Act 1993, the Crown entities Act 2004 and the New Zealand
The basis of our opinion is explained below. In addition, we outline the   Tourism board Act 1991.
responsibilities of the board members and the Auditor, and explain our
                                                                           we are responsible for expressing an independent opinion on the
independence.
                                                                           financial statements and statement of service performance and
Basis of Opinion                                                           reporting that opinion to you. This responsibility arises from section
we carried out the audit in accordance with the Auditor-General’s          15 of the Public Audit Act 2001 and the Crown entities Act 2004.
Auditing standards, which incorporate the New Zealand Auditing
                                                                           Independence
standards.
                                                                           when carrying out the audit we followed the independence
we planned and performed the audit to obtain all the information and       requirements of the Auditor-General, which incorporate the
explanations we considered necessary in order to obtain reasonable         independence requirements of the Institute of Chartered
assurance that the financial statements and statement of service           Accountants of New Zealand.
performance did not have material misstatements, whether caused
                                                                           other than the audit, we have no relationship with or interests
                                                                             ther
by fraud or error.
                                                                           in the board or any of its subsidiaries.
material misstatements are differences or omissions of amounts and
disclosures that would affect a reader’s overall understanding of the
financial statements and statement of service performance. If we had
found material misstatements that were not corrected, we would have
referred to them in our opinion.                                           Grant Taylor
                                                                           ernst & Young
The audit involved performing procedures to test the information           on behalf of the Auditor-General
presented in the financial statements and statement of service             wellington, New Zealand
52   fINANCIAl sTATemeNTs   // TourIsm ANNuAl rePorT // 2008 – 2009
                                   G25




visit: www.tourismnewzealand.com
  Tourism new zealand manaakitanga aotearoa, Po Box 95, level 22, 157 lambton Quay, wellington, new zealand
                 Tel : +64 4 462 8000 www.tourismnewzealand.com www.newzealand.com




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