ANNUAL REPORT - OpenGov NSW

ANNUAL REPORT2009 - 2010

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July - Future Fund wins the K.S. Black & Co. Country Challenge Showdown at Wentworth Park in convincing fashion and connections take away the $10,000 winner’s cheque.

Cashmere Queen’s trainer Dianne Craig is presented with a $10,000 cheque for winning the overall 2008/09 GRNSW Country Challenge series (on a count back) at a VIP function hosted by GRNSW.

August - Prizemoney levels increase for the second time in a year following a decision by the Board of GRNSW to lift prizemoney by $1.5 million.

September - GRNSW introduces eleven regional ‘Live Sites’ for membership renewals, providing participants of the sport with a convenient face-to-face way of renewing their memberships. Selected ‘Live Sites’ had staff members from GRNSW’s team available to answer questions about the grading policy and to demonstrate how participants can nominate greyhounds online.

October - GRNSW announces the establishment of a Veterinary Advisory Panel to provide independent technical advice in relation to regulatory and animal welfare issues where veterinary views are relevant to the matters being considered by GRNSW.

November - The GRNSW industry leading website and one-stop-shop for greyhound enthusiasts thedogs.com.au celebrates its first anniversary with over five million pages viewed within the first year.

December - GRNSW announces Betfair as the naming rights sponsor of the NSW Greyhound of the Year awards and the NSW Blue Paws Breeders and Owners Incentive Scheme for a period of two years. The partnership also secures Betfair as the official betting exchange partner of GRNSW.

January - GRNSW commences consultation for Project Welfare as the first step in the implementation of a long-term policy aimed at driving welfare improvement and cultural change within the sport.

February - NSW sprinting sensation Take The Kitty covers himself in glory when named the 2009 Betfair Greyhound of the Year. Bruce Fletcher accepts the Allen Wheeler Medal for excellence in the sport of greyhound racing in NSW on behalf of his father Percy Fletcher, while Shoalhaven on the State’s South Coast is named Club of the Year.

March - GRNSW announces it will increase the number of TAB meetings conducted in NSW by four meetings per week. The new meetings will predominately feature on Sky Racing 2 and will be run for half prizemoney when compared to existing TAB meetings - providing a $1.3 million prizemoney increase for participants.

April - Cosmic Rumble wins the 2010 Macro Meats Golden Easter Egg - the world’s richest free entry greyhound race - upstaging the speedy Fancy Mandy and crowd favourite Banger Harvey.

May - GRNSW undertakes a month long consultation process as part of the development of the new strategic plan Chasing 2020, providing all stakeholders with an opportunity to put forward their ideas for the future of greyhound racing in NSW directly to GRNSW.

June - GRNSW announces track upgrades at The Gardens and Maitland to improve both greyhound safety and the quality of racing at the venues. GRNSW approves $45,000 in funding to improve the safety of the 400m start and the catching pen at The Gardens, and $59,000 for the installation of a transition turn at the Maitland greyhound racing track.

2009/10 AT A GLANCE

Index

2009/10 At a Glance 1

Chairman’s Report 2

Chief Executive’s Report 4

Summary of Financial Performance 6

Operations Review 10

Organisational Structure 20

GRICG 21

Statistics 22

2009/10 Racing Review 26

2009/10 GRNSW Country Challenge 28

Freedom of Information 30

Board Members Report 32

Financial Statements 37

Greyhound Racing NSW 39

Distribution Account 59

Greyhound Industry Development Fund 75

Greyhound Industry Advancement Fund 91

Blue Paws Breeders & Owners Incentive Scheme 105

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Greyhound racing in NSW is starting to reap the benefits of stability in administration. Now well into its second year as the peak body, GRNSW is providing ongoing benefits to participants through improved operational efficiencies and the streamlining of services.

Much progress has been made in the past year and the future is looking bright for greyhound racing in NSW following growth in racing product and prizemoney. Now in control of both the regulatory and commercial functions of the sport, there is an opportunity for GRNSW to build on these synergies in the future and drive continuous improvement in the level of service provision to participants in NSW.

With the Australian economy still suffering from the aftermath of the Global Financial Crisis, GRNSW has worked extremely hard over the past year to sustain the growth of greyhound racing in NSW. This growth has been driven by the expansion of TAB racing via Sky Racing 2, which has contributed positively to revenue growth and increased returns to participants. The additional meetings are a conversion of existing Non -TAB meetings to TAB meetings. So instead of these meetings no longer making any financial return, GRNSW will receive income from TABs, corporate bookmakers and betting exchanges from wagering on these meetings.

Since my statement in last year’s Annual Report, the Board has delivered prizemoney increases of just under $1 million representing an increase of over 4.8 per cent. This was driven primarily by the implementation of stage one of GRNSW’s product expansion strategy (new TAB C meetings) and takes prizemoney increases to almost $6 million or nearly 40 per cent, in just over 2 years.

It is an exciting time for greyhound racing in NSW, with an opportunity to continue the expansion of TAB racing via Sky Racing 2 as part of GRNSW’s ongoing strategy to maximise: the exposure of greyhound racing in NSW; wagering turnover; prizemoney; and racing opportunities for participants and greyhounds.

The Board remains focused on pursuing strategies that will deliver long-term sustainable growth for the sport. In July 2010, the Board unveiled its strategic plan Chasing 2020 to provide stakeholders with an understanding of how GRNSW intends to grow and position the sport over the next decade under five pillars of strategic focus: Growth; Image; Racing; Sustainability; and Governance.

Chasing 2020 is a strategic plan that the whole sport can take ownership of, it presents a shared vision based on feedback and input collected during a robust stakeholder consultation process.

The future-looking plan outlines a set of realistic and achievable strategies - with no reliance on external sources - that will ensure greyhound racing in NSW is flourishing and thriving in 2020.

Chasing 2020 aims to deliver ongoing improvements to both the greyhound professional and hobbyist. Specifically, the plan outlines strategies to attract and support the next generation of participants at all levels of the sport, with a focus on growing passive ownership to introduce new people to greyhound racing.

The plan also outlines strategies to support our racing animals, aimed at improving the welfare of the racing greyhound through all stages of the lifecycle and increasing the awareness of the breed in the broader community.

In the pursuit of our vision to become Australia’s premier supplier of greyhound racing, we will continue to be innovative in the delivery of our services and product offering, and capitalise on our strengths and intellectual property. Most importantly, the Board will work closely with clubs, participants, administrators and government to implement the strategies outlined in Chasing 2020.

Consultation with stakeholders on key issues of importance remains central to the philosophy of the Board. We are committed to undertaking regular consultation to ensure stakeholders have input into the decision making process and believe that effective consultation will allow GRNSW to continue to deliver practical

CHAIRMAN’S REPORT

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policies of benefit to our participants. Our six monthly industry Consultative Forums and regular meetings with the Greyhound Racing Industry Consultation Group are an important input to our planning.

RegulationIn line with governments and regulatory bodies Australia wide, the Board announced a commitment to regulation reform and reducing the burden of red tape within NSW greyhound racing. As part of this, we will be reviewing our Operating Standards to simplify them without diminishing their importance.

Central to this commitment is a set of eight Better Regulation Principles to assist with regulation making in the future. The principles will be used by GRNSW when preparing regulatory proposals to demonstrate that any new regulation or amendments to existing regulatory activities are required, reasonable, practical, responsive and enforceable. The principles will ensure that regulation is only used by GRNSW when completely justified and the benefits clearly outweigh the costs of implementation and administration.

This commitment is an integral part of the Board’s vision to reduce the regulatory burden on our participants and make it easier for all to participate in the sport of greyhound racing in NSW.

TributesI would like to pay tribute to the greyhound racing innovator and reformer, the late Jan Wilson AM, who will be remembered as a passionate supporter of our great sport.

Mrs Wilson was appointed as the first Chairman of Greyhound Racing Victoria in 2000 and led the Board for more than 10 years. She was appointed Chairman of Greyhounds Australasia in 2002 and took up the position of President of the World Greyhound Racing Federation in 2007. In June 2009, Mrs Wilson was made a Member of the Order of Australia in recognition of her service to greyhound racing and to the community, which was fitting given her leadership and dedication to the sport over many years.

On behalf of my fellow Board members, I would like to pay tribute to the commitment and determination exhibited by the management team and staff at GRNSW in working towards the best outcomes for the sport of greyhound racing in NSW.

I would also like to extend thanks to our hard working and dedicated Chief Executive Brent Hogan who has continued to meet and exceed all challenges presented to him by the Board and external environment in the last year.

To all volunteers, we admire your commitment and recognise every hour you devote to our clubs and sport on a weekly basis. Your contribution is invaluable and remains central to the ongoing success of the sport.

We would also like to extend a special thanks to all clubs and participants, as the backbone of our exciting and traditional sport, greyhound racing in NSW could not continue to prosper without you.

I would also like to thank my fellow Board members who have deliberated on some tough decisions during, what have been, tough times for all codes in the national wagering market. As always, you have had the best interests of the sport at heart.

The Board is passionate about greyhound racing and will continue to pursue policies and changes that deliver ongoing benefits tothe sport’s participants and broader community.

Professor Percy Allan AMChairman

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2010 was a most successful year on many fronts: the creation of one peak body responsible for both the commercial and integrity leadership of the sport that is providing a level of stability not previously enjoyed; continued prizemoney growth whereby our graded races are contested for prizemoney at least the equal to any other state in Australia; the elevation of the Macro Meats Golden Easter Egg to the status of the world’s richest free entry greyhound race; and the expansion of TAB racing to new parts of the state as part of our long term strategy to achieve sustainable growth were amongst the highlights.

The currency of the racing industry has long been prizemoney. Over the last two years, we have put in place changes that deliver a $6.3 million prizemoney increase, a 42% increase overall. This alone is a compelling endorsement of the approach and ability of GRNSW to deliver real benefits to members of our sport.

Earlier this year we announced our intentions to increase the number of TAB meetings conducted in NSW by eight meetings per week. The new meetings predominately feature on Sky Racing 2 that commenced broadcasting on 30th March.

The decision to expand the TAB product offering reflects the changing nature of the racing and wagering industry whilst positioning the sport in NSW well for future changes to the funding model of racing.

Essentially it is about taking the opportunity that now exists for the sport’s Non-TAB meetings to be put to work and make a commercial return to the sport. The introduction of Race Fields Legislation in 2008 means that all Australian wagering operators pay GRNSW a fee for using NSW greyhound race field information. This fee is payable directly to GRNSW and as such there is a direct correlation between the performance of NSW greyhound racing and the race fields revenue GRNSW receives from Australian wagering operators. The second tier meetings attract half the prizemoney levels of the current TAB meetings, meaning that once the 400 meetings are converted from Non-TAB to TAB, participants will be racing for an additional $1.3m in prizemoney as opposed to if these meetings were to remain Non-TAB meetings.

To date we have delivered an additional four meetings per week and the expansion has included for the first time permanent TAB racing at Grafton, Wagga and Dubbo. These meetings have breathed a renewed energy into the sport in these areas and the enthusiasm with which these clubs have taken up the challenge has been most impressive.

TAB revenue continues to be our core source of revenue representing 86% of the revenue earned in 2010. It is however the

element of our revenue that we have least influence over, no matter how outstanding the performance of our own product may be, sub-standard performances by the equine codes will retard our revenue growth. To this point, our delivery of significant prizemoney increases over recent years and the expansion of TAB racing has been a direct result of the receipt of race field information use fees from wagering operators throughout Australia betting on our races as opposed to TAB revenue growth.

We continue to press the case that the long term viability of the whole racing industry in NSW is dependent on it having the ability and the incentives to compete on at least equal terms to other jurisdictions in the national wagering market. This involves embracing a culture of promoting and rewarding innovation, growth and performance and liberalising the legislative regime in order to be competitively neutral with the rest of Australia. Until this occurs, commercial imperatives dictate that we focus a large amount of our energies towards the marketing and wagering growth of our product in markets outside of NSW where the return to the sport is directly linked to the performance of our product.

Over the past year, the need for reform was recognised by the Productivity Commission in its report on Gambling in Australia,

CHIEF EXECUTIVE’S REPORT

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building upon the previous recommendations of the Alan Cameron Report on the future sustainability of the NSW racing and wagering industry. Disappointingly these recommendations continue to be largely ignored by the NSW Government which continues to support a policy framework that encourages the protectionist and inward looking thinking that dominates large sections of the NSW racing industry.

The bringing together of both commercial and regulatory functions into the one peak body achieved a long term objective of GRNSW to see a single controlling body manage the affairs of the sport independent of Government. The merger has now delivered a level of stability in the administration of the sport missing for some time meaning that all energies of the one team can be directed towards delivering one shared vision.

It is no secret that the legacy IT systems we inherited with the regulatory responsibilities are outdated and in need of significant upgrade to allow us to provide the best possible service to our members. The process of addressing this has commenced as part of a joint venture with Racing and Wagering Western Australia (RWWA) who had a similar need to overhaul their internal operating systems. Working in partnership with RWWA provides significant cost and operational synergies for both parties. This is a two year project that will ultimately mean for our members that doing business with GRNSW will be simpler, more efficient and a lot more contemporary.

As part of our commitment to strengthen both our service offering and the delivery of that to members of the sport, we released our Customer Service Commitment earlier this year.

Our Customer Service Commitment has been developed to provide members with information on the services GRNSW provides, the process for connecting to our services, the level of service that we aim to deliver and who stakeholders should contact at GRNSW about those services.

Only recently we released Chasing 2020, our strategic plan for the next decade. It outlines a set of aspirations that will shape the direction of our sport for the next decade and identifies strategies to achieve our vision.

The plan has been developed in close consultation with stakeholders and we believe presents a shared vision for how we want the sport to develop over the next decade. Having a shared vision is incredibly important as GRNSW acting alone cannot achieve or deliver on the strategic plan, instead the ‘buy in’ and active contribution of our clubs, participants and business partners is absolutely necessary to achieve our goals.

Whilst the strategic plan is a visionary document, it is not a plan full of unachievable goals or strategies that we are reliant on windfall gains to pursue. Instead the plan provides a realistic roadmap for

the future and will be supported by yearly operational plans that will set out the steps necessary to get to where we want to be. From the 2011 Annual Report onwards, we will formally report against the progress made towards implementing Chasing 2020 in each Annual Report. As part of the implementation process, we have reorganised GRNSW into distinct business units that support and are accountable for the implementation of Chasing 2020.

Like the Chairman, I would also like to pay tribute to the late Jan Wilson AM, Chairman of Greyhound Racing Victoria and Greyhounds Australasia, who provided strong and passionate leadership for the sport at a national level over a significant period. Jan’s legacy to the sport is substantial and reaches far beyond her home state of Victoria, not the least her efforts to ensure animal welfare considerations are central to all aspects of the sport Australia wide.

May I also pay tribute to the late Keith Webb who passed away after a short illness earlier this year. At the time of his passing, Keith held the role of Chairman of the Canberra Greyhound Racing Club, who we continue to have a close working relationship with. Keith was also a great contributor to the sport at a national level as a Director of Greyhounds Australasia.

May I take the opportunity to thank all our hard-working staff for their contributions to making the transition to one organisation as seamless as possible for our members and delivering on our ambitious agenda over the last year. In particular can I acknowledge the role played by our Chief Operating Officer Darren Simpson who has worked tirelessly to give effect to the operational requirements of the merger. Darren leads a dynamic and talented leadership group committed to the attainment of the aspirations of the sport set out in Chasing 2020.

Last but not least, may I thank the Board for their counsel and support. They all dedicate a lot of valuable time to provide their insights and steer the direction of the sport that they are most passionate about.

I look forward to another successful year ahead.

Brent HoganChief Executive

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The greyhound industry was reunited from an administrative perspective in the 2010 financial year with the merger of GRNSW and the greyhound component of the GHRRA taking effect on 1 July 2009. The merger had significant impacts on GRNSW’s accounts, however, with the sport now controlled independently of government it is to be hoped that future financial benefit will find its way to the participants of the sport.

TAB Distribution income to GRNSW grew modestly in 2010 by $582,862, or just on 2%, which represented a slowing of the growth experienced in 2009. The 2009 result was somewhat overstated given that wagering turnover was recovering from the Equine Influenza impacted 2008.

2010 was also the first year in which GRNSW collected Race Field Information Use Fees for a full 12 months following their introduction in September of 2008. Last year GRNSW reported Race Field Information Use Fee income of $6,790,233, but also a corresponding expense of $3,730,425, which was primarily due to the settlement of a dispute with TAB Limited with

respect to the Racing Distribution Agreement and the payment of Race Field Information Use Fees.

In 2010 the reported income for Race Field Information Use Fees was $4,508,916. Whilst this was well below the 2009 figure it is noteworthy that the Board has deferred the realisation of $6,530,205 of income due to an element of legal uncertainty which exists.

Nevertheless greyhound racing in NSW remains the only racing code in NSW to be putting revenue earnt from fees generated by Race Fields Legislation into prizemoney for participants. After raising Distribution Payments to Clubs by $2,652,587 in 2009 on the back of this revenue stream, GRNSW injected a further $3,270,512 in 2010. The vast majority of this money is paid out by clubs as prizemoney and it is the reason behind the almost $6 million increase in prizemoney (nearly 40%) in just over two years referred to in the Chairman’s Statement at the beginning of this report.

SUMMARY OF FINANCIAL PERFORMANCE

________________________________________________________________________________________________________ 2010 2009 2008 Actual Actual ActualIndustry Income ________________________________________________________________________________________________________TAB Distributions 30,296,117 29,713,255 27,223,034 Racefield Information Use Fees 4,508,916 6,790,233 -Interest & Other 289,087 267,576 257,388 EI Government Grant - - 500,000 ________________________________________________________________________________________________________Total Industry Income 35,094,120 36,771,064 27,980,422 ________________________________________________________________________________________________________ Industry Expenditure ________________________________________________________________________________________________________First Charge Expenses ________________________________________________________________________________________________________G&HRRA - 3,087,743 3,100,000 ________________________________________________________________________________________________________GRNSW 4,739,380 1,459,000 1,559,000 ________________________________________________________________________________________________________On-Course Tote Commissions 1,219,709 1,322,578 2,231,970 ________________________________________________________________________________________________________Club Incentive Scheme 1,305,022 1,027,528 -________________________________________________________________________________________________________GIDF 2,750,000 2,750,000 2,272,776 ________________________________________________________________________________________________________Racefield / Wagering Expenses 196,779 3,810,495 -________________________________________________________________________________________________________Merger Expenses 618,240 330,015 ________________________________________________________________________________________________________Other 8,195 27,450 375,126 ________________________________________________________________________________________________________Total First Charge Expenditure 10,837,325 13,814,809 9,538,872 ________________________________________________________________________________________________________Second Charge Expenses ________________________________________________________________________________________________________Scheme of Distribution Payments to Clubs 24,783,984 21,513,472 18,860,885 ________________________________________________________________________________________________________IAF 700,000 550,000 510,000 ________________________________________________________________________________________________________Total Industry Expenditure 36,321,309 35,878,280 28,909,757 ________________________________________________________________________________________________________Surplus / Deficit - 1,227,189 892,784 - 929,335 ________________________________________________________________________________________________________

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As mentioned above an important change to the structure of the industry in 2010 saw GRNSW handed full responsibility for the administration of the sport. This resulted in the first charge expense of the payment to GRNSW rising to $4,739,380, but also the elimination of the payment to the GHRRA. The 2010 amount represents the combined GRNSW and GHRRA figures from 2009 plus a modest increase of $192,637 (4%) which in part went to funding the additional regulatory expense associated with the commencement of TAB C racing.

A policy change by the GRNSW Board saw the amount paid in on-course tote commissions in 2009 reduced to 5% of on-course turnover (down from an average of 7.4%). 2010 was the second year that this policy had been in place and the On-Course Tote Commission expenditure reduced slightly this year to $1,219,709.

This on-course tote reduction meant more money was available to be distributed to clubs under the Club Incentive Scheme. The Club Incentive Scheme, in its second year in 2010, was established to enable all clubs the opportunity to earn an incentive payment, rather than restricting additional income to those clubs with an on-course tote. Clubs received payments reflecting on-course bookmaker performance, plus an incentive payment if they paid prizemoney over and above the minimum requirement of GRNSW. In order to qualify for a payment, clubs must also trade at a profit on Earnings Before Interest, Tax, Amortisation and Depreciation (EBITDA).

The Club Incentive Scheme was designed to encourage clubs to return money to participants as prizemoney over and above the requirement of GRNSW. In an extremely pleasing outcome clubs responded in 2010 by paying out $1,048,027 more in prizemoney than the GRNSW minimum. The amount each club received as an incentive payment this year is detailed in the table on page 8, along with on-course tote commissions and distribution payments.

Funds directed to the Greyhound Industry Development Fund (GIDF) in 2010 remained stable at $2,750,000. The method of

payment to the GIDF changed from a percentage of distribution income to a fixed budgeted amount in 2009. Projects funded by the GIDF are explained further on page 16 of this report.

A further by-product of the merger of GRNSW and GHRRA was the transfer of all assets and liabilities that sat on the greyhound side of the GHRRA to GRNSW. The most significant of these is the building located at 22 Meredith Street Bankstown, of which GRNSW now owns 53%. This asset is now recorded in the GIDF accounts (see finances in this report).

The Industry Advancement Fund (IAF) received an increased allocation of $700,000 in 2010. The IAF is a special budgeted fund which exists to improve the overall racing, trading and development of the NSW greyhound racing industry. The IAF supports programs such as Betfair Blue Paws, Greyhounds as Pets, the GRNSW Country Challenge, Club Partnership Grants (for marketing and promotion) and the hosting of the Betfair Greyhound of the Year.

A final impact of the consolidation of the greyhound activities of the GHRRA into GRNSW was felt with a further $618,240 in expenses directly related to the merger being incurred in 2010. The figure primarily reflects the expenses borne by GRNSW with respect to transferring staff members (from GHRRA to GRNSW). This treatment was at the direction of the NSW Government. Costs involved in consolidating to one office location are also captured as Merger Expenses.

The final result in 2010 was a loss of $1,227,189, more than half of which is attributable to the abovementioned merger expense. As at 30 June the industry holds retained earnings of $174,081 and deferred revenue of $8,392,315 – the treatment of which will become clearer as the legal situation surrounding Race Fields Legislation is played out.

How do we earn our Income and where does it go?

Metropolitan club

First charges

Other TAB clubs

Funds received by the greyhound racing industry

via its commercial arrangements with the other racing codes with respect to the Racing

Distribution Agreement and Race Field

Information Use Fees received as a result of the Race Fields

Legislation

second charge allocation between sectors

Non-TAB clubs

Industry Advancement Fund (IAF): other funds available for distribution

Funds available to be distributed via the Scheme

of Distribution Policy

Greyhound Industry Development Fund: as determined by the Board

of GRNSW

GRNSW administration charge: as provided by Greyhound Racing

Act 2009

Club Incentive Pool: as determined by the Board of GRNSW

Miscellaneous first charge: as approved by Board of GRNSW

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SUMMARY OF FINANCIAL PERFORMANCE

PAYMENTS TO CLUBS

Club / Entity SOD Payments Club Incentive Scheme On Course Tote TOTAL_______________________________________________________________________________________________Armidale 83,430.00 3,631.70 87,061.70_______________________________________________________________________________________________Broken Hill 144,538.33 4,373.05 330.98 149,242.36_______________________________________________________________________________________________Casino 1,042,870.00 183,589.07 52,816.67 1,279,275.74_______________________________________________________________________________________________Coonabarabran 82,745.00 4,500.02 87,245.02_______________________________________________________________________________________________Coonamble 100,765.00 25,288.94 126,053.94_______________________________________________________________________________________________Cowra 117,645.00 12,651.34 130,296.34_______________________________________________________________________________________________Dapto 1,313,076.94 156,890.60 98,586.29 1,568,553.83_______________________________________________________________________________________________Dubbo 237,511.48 6,641.98 8,039.70 252,193.16_______________________________________________________________________________________________Forbes 64,785.38 792.51 65,577.89_______________________________________________________________________________________________GBOTA - Appin 169,105.00 9,620.87 4,748.13 183,474.00_______________________________________________________________________________________________GBOTA - Bathurst 756,440.00 74,854.59 31,001.52 862,296.11_______________________________________________________________________________________________GBOTA - Bulli 1,169,950.00 15,429.44 75,303.99 1,260,683.43_______________________________________________________________________________________________GBOTA - Gosford 1,171,480.00 52,561.89 77,440.52 1,301,482.41_______________________________________________________________________________________________GBOTA - Gunnedah 151,917.80 19,952.40 939.75 172,809.95_______________________________________________________________________________________________GBOTA - Lismore 1,225,750.00 39,624.76 44,030.50 1,309,405.26_______________________________________________________________________________________________GBOTA - Maitland 1,023,120.00 57,723.22 51,284.52 1,132,127.74_______________________________________________________________________________________________GBOTA - Temora 168,704.88 1,012.54 739.73 170,457.15_______________________________________________________________________________________________GBOTA - Wentworth Park 8,620,836.92 324,731.18 379,908.88 9,325,476.98_______________________________________________________________________________________________Goulburn 223,505.00 8,405.94 791.78 232,702.72_______________________________________________________________________________________________Grafton 232,919.95 43,545.47 21,757.89 298,223.31_______________________________________________________________________________________________Greyhound Social Club (Potts Park) 137,030.00 18,234.76 10,339.64 165,604.40_______________________________________________________________________________________________Hastings River (Wauchope) 143,460.00 11,801.91 155,261.91_______________________________________________________________________________________________Kempsey 155,660.00 13,435.56 308.88 169,404.44_______________________________________________________________________________________________Lithgow 222,905.00 555.40 282.33 223,742.73_______________________________________________________________________________________________Moree 126,702.33 4,206.27 130,908.60_______________________________________________________________________________________________Mudgee 75,430.00 974.20 76,404.20_______________________________________________________________________________________________Muswellbrook 148,505.00 4,322.01 152,827.01_______________________________________________________________________________________________NCA - Tamworth 108,160.00 108,160.00_______________________________________________________________________________________________NCA - The Gardens 2,417,655.00 89,903.86 144,739.96 2,652,298.82_______________________________________________________________________________________________Richmond 1,732,385.19 26,387.69 124,522.67 1,883,295.55_______________________________________________________________________________________________Shoalhaven (Nowra) 742,540.00 40,300.34 20,136.29 802,976.63_______________________________________________________________________________________________Taree 157,060.00 24,943.73 161.08 182,164.81_______________________________________________________________________________________________Tweed Heads 220,705.00 1,503.62 62,136.60 284,345.22_______________________________________________________________________________________________Wagga Wagga 185,030.00 20,236.03 4,826.41 210,092.44_______________________________________________________________________________________________Young 109,660.00 9,886.83 328.25 119,875.08_______________________________________________________________________________________________

TOTALS 24,783,984.20 1,305,022.45 1,219,709.23 27,308,715.88_______________________________________________________________________________________________

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The Hunter’s premier track The Gardens

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GROwTH & SUSTAINABILITY

Sky Racing 2 ExpansionThe commencement of Sky Racing 2 on 30 March 2010 provided GRNSW with the opportunity to implement the first stages of its product expansion strategy.

The product expansion strategy aims to increase supply of TAB meetings wherever possible to maximise: wagering turnover; the exposure of greyhound racing in NSW; prizemoney and racing opportunities for participants.

The additional TAB meetings will be a conversion of 400 existing Non-TAB meetings to TAB status. The move to TAB status enables these meetings to make a positive financial contribution to the sport, as GRNSW will now receive income from interstate TABs, corporate wagering operators and Betfair from wagering on these meetings.

The strategy provides the opportunity to expand the core customer base of NSW greyhound racing by capitalising on scheduling changes occurring in other codes. It will allow the sport to continue operating as it presently does should a national product fee be introduced at some point in the future. The strategy also aims to drive long-term sustainable growth in markets where there is a direct correlation between our performance and the Race Fields fees we receive.

As part of the expansion, GRNSW will look to increase the number of TAB meetings conducted in NSW by eight meetings per week. At 20 meetings a week, GRNSW will be the largest product supplier - of any code - to the Australian wagering industry. The new meetings will predominately feature on Sky Racing 2 and will be run for almost double the prize money offered for existing Non-TAB meetings - representing a $1.3 million prizemoney increase for participants.

Stage one, which commenced in April 2010, saw Non-TAB meetings at Bathurst, The Gardens, Dapto, Nowra, Dubbo, Wagga Wagga and Grafton being promoted to TAB C status. Stage two will see GRNSW continue the expansion with the possibility of providing four extra TAB meetings in the near future.

OwnershipGRNSW has been heavily involved in the development of the new national ownership and syndication rules, policies and procedures, currently under consideration by Greyhounds Australasia and expected to be introduced in 2010/11.

Project welfare In January 2010, GRNSW commenced the development of Project Welfare as the first step in the implementation of a long-term policy aimed at driving welfare improvement and cultural change within the sport.

The process included extensive consultation with participants at all levels of the sport including those currently not regulated - breeders and rearing establishments - as well as animal welfare groups and agencies.

Face-to-face consultation sessions were held in a number of metropolitan and regional locations across the state, with the aim of providing all participants with an opportunity to contribute to discussions on the issue.

In addition, direct input was sought from recognised industry bodies including the NSW Greyhound Breeders Owners & Trainers Association, NSW National Coursing Association, Greyhound Racing Clubs Association and Registered Greyhound Participants Association.

A number of key issues and areas were identified during Project Welfare consultations, and stakeholder feedback provided the basis for the welfare strategies outlined in GRNSW’s strategic plan Chasing 2020. As part of the ongoing implementation of the plan, GRNSW will develop policies and practices in the following areas to achieve best practice standards in greyhound welfare:• Improvedlicensingandregulationofbreeders,trainersand

rearing establishments• Improvedtrackpreparation• Raceprogrammingthatmaximisestheracinglifeofgreyhounds• Increasedre-homingofgreyhounds• Introductionofracedayandclubwelfarepolicies• Improvedlifecycletracking• Encouragingresponsiblebreedingpractices.

Greyhounds as Pets 2009/10 was another active and successful year for the Greyhounds as Pets (GAP) initiative. Now into its third year of running under GRNSW control, GAP is a crucial element of the sport’s response to greyhound welfare issues in NSW by providing retired or unsuccessful greyhounds with a career change.

GRNSW has been working hard over the last year to expand the GAP program, as well as increase re-homing numbers and awareness of the greyhound breed.

OPERATIONS REVIEw

Greyhounds as Pets

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Sponsorship partnerships with Pfizer for worming and flea treatments products, and with Advance for dry food products, have continued and remain an integral part of support provided to GAP by a number of different partners.

GRNSW launched an expansion of the GAP program in conjunction with the NSW Government’s Corrective Services Department in April 2010 that will see up to six greyhounds at any one time being cared for by inmates at the women’s Dillwynia Correctional Centre at Windsor. Inmates will retrain and socialise ex-racing greyhounds, preparing the animals for life as family pets. The partnership will assist GRNSW to increase re-homing numbers in the future and help inmates to develop new skills and qualifications in animal handling and achieve a TAFE qualification.

GRNSW will continue to explore partnerships with other organisations in the future as part of its aspiration to increase re-homing numbers in NSW, including the exploration of new relationships with other correctional services facilities.

GRNSW has continued promotion of GAP and the greyhound breed through ongoing participation in a number of promotional events:• GAPstaffattendedGRNSW‘LiveSites’inCanberra,Gosford

and at Wentworth Park to provide further information on the program

• GAPandanumberofourvolunteersattendedthe2009World Dog Games at Acer Arena and the 2009 Pet and Animal Expo at Rosehill Gardens

• GAPandGRNSWpresentedtotheAnnualRSPCANSWInspectors Conference held at Bateau Bay in October 2009

• GAPteamedupwithmajorsponsorAdvancetoattend‘FairDay’ at one of Australia’s major festivals - the 2010 annual Gay and Lesbian Mardi Gras

• GAPteamedupwiththeAvocaDriveAnimalHospitalstaffto promote and walk some of the greyhounds being fostered in the GAP program in the RSPCA Million Paws Walk at Gosford in May 2010

• GAPteamedupwiththeAvocaDriveAnimalHospitalagainin July 2010 to promote the breed through participation in the Central Coast’s Five Lands Walk.

• TheseeventsprovidedanexcellentopportunityforGRNSWto showcase GAP and the greyhound breed and to educate people as to why greyhounds make such great pets.

GRNSW has committed additional resources to GAP in 2011 as part of the initiatives announced in Chasing 2020. The extra

resourcing will enable GRNSW to continue to expand the program in the future.

Betfair Blue PawsIn December 2009 Betfair became the official naming rights sponsor for the Blue Paws Breeders and Owners Incentive Scheme for a period of two years.

The Betfair Blue Paws Breeders and Owners Incentive Scheme, launched in January 2006, aims to promote, develop and encourage increased investment in the NSW breeding industry by offering owners and breeders opportunities to race for greater returns statewide.

Higher racetrack returns are made by breeders and owners with Betfair Blue Paws greyhounds (versus non-eligible competitors) as connections receive the standard prizemoney plus an additional bonus payment if their greyhound wins a race carrying a bonus. The Betfair Blue Paws Breeders and Owners Incentive Scheme has paid out over $1 million in bonuses since its inception. 7,940 eligible races have been conducted throughout NSW across both TAB and Non-TAB tracks, with bonuses paid to 2,421 winners. In addition, over 9,700 pups been nominated into the scheme.

The Betfair Blue Paws Super Series was an exciting addition to the breeders and owners incentive scheme in 2009/10, as Betfair threw their full support behind the concept which was staged at all 11 TAB tracks. The Betfair Blue Paws Super Series has now been extended to TAB C clubs, meaning all 14 TAB tracks will host a leg of the series which provides bonuses double to what is on offer in normal Betfair Blue Paws races.

GRNSW believes that Betfair Blue Paws is working well as a racing scheme, without being convinced the current structure is optimal in promoting, developing and encouraging increased investment in the NSW breeding industry.

As outlined in Chasing 2020, GRNSW intends to review and potentially restructure the Betfair Blue Paws scheme during 2011/12 to ensure a model that spreads rewards optimally amongst participants and to ensure the scheme acts as sustainable component of the racing and breeding industry.

A statistical summary of the Betfair Blue Paws scheme for the 2009/10 financial year is as follows:

Number of New Blue Paws Nominations 2,241_________________________________________________Number of Blue Paws Races 1,862_________________________________________________Number of Blue Paws Nominated Winners 701_________________________________________________Winning Percentage of Blue Paws Races 37.7%_________________________________________________Bonuses Won and Paid $282,613

Pampering adoptees

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RACING & INTEGRITY

New Kennel Inspections PolicyAs part of GRNSW’s ongoing integrity assurance program, routine kennel inspections are carried out across NSW to assess suitability of training facilities with regard to animal welfare, occupational health and safety, and security compliance.

As part of its commitment to continually develop and adopt best practice in integrity operations, GRNSW announced it will conduct kennel inspections for all licensed persons once every two years from 1 July 2011. This new policy will lead to improved greyhound welfare, increased education of participants and industry leading standards in integrity.

New Racing ScheduleGRNSW announced the 2010/11 TAB race dates schedule on 31 March 2010 following a process of consultation with clubs and other stakeholders. The new schedule included a number of significant changes facilitated by the launch of Sky Racing 2, providing an opportunity for GRNSW to implement the first stages of its product expansion strategy. From 1 July 2010, Wentworth Park added Friday night racing to Saturday’s premium greyhound race meeting and Richmond’s main program switched from Friday to Saturday night as the second NSW greyhound meeting. Bulli replaced Wentworth Park on a Monday night providing consistency of racing at the popular south coast circuit. The new TAB racing schedule aims to position the sport for the changes that are occurring in the racing and wagering marketplace, by maximising the exposure of the sport by placing GRNSW’s best brands in the best timeslots. GRNSW is confident that it has delivered a balanced schedule that will help maximise wagering revenue whilst not disadvantaging NSW greyhound racing clubs. Other changes see racing at The Gardens in the twilight timeslot on a Saturday following on from the metropolitan thoroughbred races in the afternoon, providing a platform to continue to promote greyhound racing in the Hunter. Wagga Wagga, Grafton and Dubbo have also been elevated to the TAB racing circuit as part of the changes, with the tracks hosting new TAB C meetings on the 2010/11 schedule. Grafton now shares the Thursday afternoon racing timeslot with Dubbo, while Wagga Wagga will share Sunday afternoons with Nowra.

The new TAB race dates schedule began on 1 July 2010 and will be reviewed prior to the allocation of race dates for 2011/12.

Freezing of SwabsIn July 2010 the GRNSW Board adopted Local Rule 80 to allow for the storing of Urine Samples and re-submission of frozen samples for later testing. The addition of the Local Rule should act as a general deterrent to those wishing to push the boundaries of the laboratory’s testing capabilities by using products that are believed to be one step ahead of the sampling regime.

Regulatory BurdenThe regulatory burden on participants will be reduced after GRNSW adopted a series of changes as part of its commitment to regulation reform and reducing red tape within NSW greyhound racing.

Policy changes approved by the GRNSW Board in July 2010 include:• Prizemoneyupto$5,830nolongerbeingwithhelduntilswab

samples are cleared• Weightcardsbeingissuedwithnamingcertificates• TheimplementationofBetterRegulationPrinciplestocut

red tape and ensure all regulations introduced are required, reasonable, responsive and enforceable.

From Wednesday 1 September 2010, participants are no longer required to present their named greyhound for an inspection by GRNSW officials prior to being issued a weight card. Instead, the weight card is now being issued in conjunction with the greyhound’s naming certificate.

Prizemoney of up to $5,830 will now be paid immediately regardless of whether the greyhound has been swabbed. Delays in the payment of swab prizemoney are a cause of constant frustration to participants and this new approach will assist the

OPERATIONS REVIEw

2009 Australian Greyhound of the Year Cindeen Shelby (left) in full flight

13

cash flow of trainers and reduce the administrative burden on clubs. GRNSW will recover any prizemoney paid out to a participant whose greyhound is subsequently disqualified from a race. GRNSW has also adopted a set of principles to facilitate better regulation making, in line with commitments from governments and regulatory bodies Australia wide. The principles will be used when preparing regulatory proposals to demonstrate that any new regulations or amendments to existing regulatory activities are required, reasonable, practical, responsive and enforceable. The principles will ensure that regulation is only used by GRNSW when completely justified and the benefits clearly outweigh the costs of implementation and administration.

The Better Regulation Principles are as follows:

Principle 1 - The need for action should be established

Principle 2 - The objective of action should be clear

Principle 3 - The impact of action should be properly understood

by considering the costs and benefits of a range of

options, including non-regulatory options

Principle 4 - Action should be effective and proportional

Principle 5 - Consultation should inform regulatory development

Principle 6 - The simplification, repeal, reform or consolidation of

existing regulation should be considered

Principle 7 - Regulation should be periodically reviewed and

if necessary reformed to ensure its continued

efficiency and effectiveness

Principle 8 - Regulation should be appropriate and enforceable.

StewardingGRNSW undertook a restructure of the stewarding panel following the GRNSW and GHRRA merger in July 2009. The changes included the creation of two Deputy Chairmen positions under the Chief Steward and the addition of new panel members, broadening the experience and skills base of the Racing & Integrity team.

Additional changes to enhance the Racing & Integrity team were made in July 2010 with the appointment of permanent GRNSW Regional Integrity Officers throughout NSW. The Regional Integrity Officers will be located in the North Coast, Hunter

and Central West regions and will undertake race day stewarding, kennel inspections, ear branding and marking in those areas.

The Regional Integrity Officers will provide GRNSW with the ability to respond swiftly to integrity situations as they arise in regional areas and provide greater flexibility in meeting operational requirements. The officers also provide GRNSW with a permanent presence in regional areas where a large number of participants are located.

Swabbing and TestingThe random ballot feature used for swabbing (to collect swabs) was abolished at metropolitan and TAB meetings in September 2009. This change brought NSW into line with all other greyhound jurisdictions in Australia, as well as major thoroughbred and harness racing controlling bodies.

Out of competition testing forms an integral component of GRNSW’s ongoing prohibited substance detection strategy, confirming our stance against illicit substance use. GRNSW stewards conducted Australia’s first out of competition testing of greyhounds in March 2010 in the lead up to the Macro Meats Golden Easter Egg series.

Out of competition testing is conducted under the provisions of Local Rule 1A which provides specifically for out of competition sampling.

Appeals During 2009/10, 11 appeals to the Racing Appeals Tribunal relating to greyhound racing matters were determined (compared to 10 in 2008/09).

Results were as follows: 3 upheld; 6 dismissed; 2 dismissed (penalty varied); and 1 withdrawn.

National Futurity hopefuls at The Gardens

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Disciplinary action against participants in 2009/10 involved 7 disqualifications (32 in 2007/08) and fines totalling $27,837 ($25,195 in 2007/08).

Drug Analysis and Testing

_______________________________________________Year % of positives No. of samples tested _______________________________________________

2001-02 1.61 2725_______________________________________________

2002-03 1.56 3016_______________________________________________

2003-04 1.30 3085_______________________________________________

2004-05 1.23 3241_______________________________________________

2005-06 1.68 3028_______________________________________________

2006-07 2.16 3277_______________________________________________

2007-08 1.01 3177_______________________________________________

2008-09 0.83 2996_______________________________________________

2009-10 0.94 3393_______________________________________________

Of the 3,393 samples tested during 2009/10, 32 returned positive results. Stewards will continue to focus on this area of racing in 2010/11 as part of GRNSW’s pursuit of best practice in integrity operations.

GradingThe grading area is a key part of GRNSW’s daily operations. Grading ensures the viability of the sport by creating fair, equitable and transparent racing at the highest standard, while at the same time maximising the racing career of greyhounds in NSW.

A number of small changes were made in the area of grading during 2009/10. The TAB Grading Policy was amended to reflect the introduction of TAB C racing. Grading of TAB C meetings has been incorporated into the current TAB system, which treats each track and distance separately.

GRNSW also changed the treatment of greyhounds moving between 5th and 4th grade, allowing greyhounds to compete in mixed 4/5 grade races after two 5th grade wins. This change means that greyhounds will not be directly disadvantaged when moving out of 5th grade, allowing trainers to ease their greyhound into competing at the higher level.

In the Non-TAB sector, GRNSW has introduced changes to grading for higher grade events and an ‘order of entry’ procedure to assist graders at country clubs.

RacingGRNSW implemented a number of initiatives during 2009/10 aimed at improving animal welfare and greyhound safety at NSW greyhound tracks. GRNSW is committed to working closely with clubs and race day officials to ensure those involved in greyhound racing have an understanding of the reasons behind the need for greyhound welfare policies and practices. GRNSW believes clubs, as custodians of racing in their communities, have an important role to play in developing greater awareness of welfare issues in the sport.

As part of the implementation of Project Welfare, GRNSW is reviewing club standards in a number of areas, including:

Hot weather and kennelling policies•Track safety•Catching pen condition•Race day procedures •Occupational Health & Safety procedures for staff•In addition to the review of club welfare standards, GRNSW •announced track upgrades at The Gardens and Maitland to improve both greyhound safety and the quality of racing at the venues.

GRNSW approved $45,000 in funding at The Gardens to improve the safety of the 400m start and the catching pen. The project, completed in early July 2010, saw the 413m boxes shifted to allow for a safer start on to the bend. As a result, The Gardens now races over a distance of 400m instead of 413m.

At the same time, the catching pen was re-located further around the track allowing greyhounds a longer run-in at the completion of races. This change addressed what was seen as a design flaw

OPERATIONS REVIEw

Reddy To Whine in full flight

15

of The Gardens, as greyhounds will now have more time to slow down before entering the catching pen.

The Board of GRNSW also approved $59,000 in funding for the installation of a transition turn at the Maitland greyhound racing track. Interference at the first turn has been a concern at Maitland since its conversion to loam and the changes will reduce interference and improve the quality of racing at the venue.

These projects fit directly under the Racing pillar of the Board’s recently released strategic plan Chasing 2020, which highlights the need for ongoing track improvements to ensure the welfare of the greyhounds and consistency for punters.

Online ServicesOnline services provided by GRNSW in the Racing & Integrity area have continued to increase in popularity during 2009/10.

The number of nominations received online has improved significantly in the past year. In the 2009/10 financial year 39 per cent of nominations were received online, demonstrating that participants are benefiting directly from the ease and speed of nominating their greyhounds via thedogs.com.au website. This service has provided improved customer service levels and speed, doing away with the need to phone the grading department directly to nominate a greyhound.

GRNSW endeavours to continue to educate participants on the benefits of nominating online, as well as improve the quality and functionality of the service.

A summary of nomination trends for 2009/10 is as follows:____________________________________________________Month Online Phone Fax Finals____________________________________________________ July 09 33% 46% 15% 6%____________________________________________________ August 09 32% 45% 15% 8%____________________________________________________ September 09 33% 44% 15% 8%____________________________________________________ October 09 33% 42% 14% 11%____________________________________________________ November 09 33% 41% 13% 13%____________________________________________________ December 09 42% 39% 14% 5%____________________________________________________ January 10 37% 39% 14% 10%____________________________________________________ February 10 39% 42% 12% 7%____________________________________________________ March 10 35% 43% 14% 8%____________________________________________________ April 10 43% 26% 25% 6%____________________________________________________ May 10 49% 21% 22% 8%____________________________________________________ June 10 51% 19% 22% 8%____________________________________________________ Totals 39% 36% 17% 8%____________________________________________________

Note: TAB C racing was introduced from 1 April 2010 and nominations for these meetings are only accepted online or via fax. Another notable improvement provided to participants was the introduction of online Stewards reports in October 2009. GNRSW now strives to have all Stewards reports posted online within 24 hours of a TAB race meeting’s completion.

Other Integrity IssuesAs part of ongoing improvements to GRNSW’s integrity assurance program during 2009/10, disqualified persons applying for registration are now required to appear for an interview before consideration is given to licensing.

During 2009/10 GRNSW has been instrumental in driving a number of rule changes at the national level, in particular in the areas of welfare and breeding.

In March 2009, GRNSW introduced LR 105 aimed at improving the life time tracking of all greyhounds.

LR105At any time after registration of a litter, the breeder or owner of any greyhound will be responsible for that greyhound and shall advise GRNSW, by completion of the prescribed form, if that greyhound has transferred ownership, being retired as a pet, breeding greyhound, GAP greyhound, exported, surrendered to another agency, been humanely euthanasied by a veterinarian or deceased.

This will be adopted as a National Rule from 1 January 2011.

Veterinary Advisory Panel The Veterinary Advisory Panel (VAP) was established to provide independent technical advice in relation to regulatory and animal welfare issues where veterinary views are relevant to the matters being considered by GRNSW.

The VAP is an independent group of veterinarians, with particular expertise in respect to greyhounds. The panel consists of Dr. Ted Humphries, Dr. Peter Yore, Dr. Linda Corney, Dr. Rob Zammit and Dr. Bob May.

The VAP’s professional advice, particularly in areas relating to the detection of prohibited substances, will ensure sound, rational and balanced policy decisions are made in the future.

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MEMBER & CLUB SERVICES

Customer Service CommitmentIn March 2010, GRNSW released a Customer Service Commitment charter designed to provide participants and stakeholders with information on:

The services we provide•The process of connecting to our services•The levels of service that we aim to deliver•Who to contact at GRNSW.•

The Customer Service Commitment is an integral part of GRNSW’s aspiration to deliver customer service at best practice levels to participants of the sport.

Operating StandardsGRNSW’s Operating Standards incorporate five crucial areas of administration, outlining the minimum requirements that clubs must achieve to be granted registration each year. The five areas addressed by the Operating Standards are:

Financial Management•Marketing and Business Planning•Risk Management•Facilities management•Corporate Governance.•

The Operating Standards are reviewed on a quarterly basis in March, June, September and December each year, with eight standards considered per quarter.

At the present time, all clubs are meeting the Operating Standards and GRNSW will continue to work closely with clubs to facilitate their registration in the future.

All clubs that applied for re-registration in December 2009 were compliant with the requirements of the Operating Standards and were therefore granted re-registration.

As part of the implementation of the strategies from Chasing 2020, GRNSW will undertake a review of the club Operating

Standards during the second half of 2010, with the purpose of streamlining and simplifying the criteria which clubs must meet. This process aims to significantly reduce the regulatory burden on clubs and provide them with more time to focus on their racing operations.

Greyhound Industry Development FundCreated with the intent of rejuvenating industry assets and providing new funding for capital investment, the Greyhound Industry Development Fund (GIDF) provides funding for rehabilitating and erecting new facilities across the state.

Throughout the 2009/10 financial year the GIDF funded a number of maintenance items and new projects across NSW clubs including:

$157,000 for the upgrade of the Potts Park kennels •$72,000 for the installation of a new lure rail at Dubbo•$71,000 for an electrical supply upgrade at Grafton•$65,000 for an upgrade of the Maitland viewing area•$59,000 for a new transition turn at Maitland•$45,000 for the construction of a new 400m start and •catching pen at The Gardens.

Over the past year, GRNSW has approved 47 GIDF projects (including OH&S, PMR, VEMP, EWA, Wentworth Park and Trial Track funding) and 256 projects under the MVIA initiative.

Trial TracksAs set out in the Greyhound Racing Act 2009, GRNSW has responsibility for the registration of all trial tracks in NSW.

GRNSW supports and encourages the establishment of greyhound trialling facilities where possible and are prepared to consider the funding of such establishments from the GIDF. During 2009/10 GIDF funding contributed to the opening of the Bankstown and Dapto slipping tracks, which have proven to be valuable facilities for participants.

The following trial tracks are registered with GRNSW for the 2010 calendar year :

GIDF Funding SubsetMaintenance & Venue Improvement Allowance (MVIA)

Programmed Major Renewals (PMR)

Wentworth Park (WP)

Venue Enhancement & Major Projects (VEMP)

Occupational Health & Safety (OH&S)

Emergency Works Allocation (EWA)

DescriptionThe successful ‘dollar-for-dollar’ program that gives clubs a level of discretion in ongoing venue spending.

Major renewal works required at each venue as per the recommendations of the 2006 GHD report.

To be treated separately with works scheduled in line with the 2005 SKM report, and to enhance the venue as NSW’s greyhound racing flagship.

New works that may include upgrades to patron facilities, installation of training facilities etc.

An allowance set aside to address the OH&S concerns raised in the 2006 GHD report.

An allowance set aside to assist clubs in genuine emergency situations.

OPERATIONS REVIEw

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Abernethy Trial Track•Box Hill Trial Track•Cardiff Greyhound Social Club•Cawbourne Park Trial Track•Casino Trial Track•Cessnock and District Agricultural Association•Glengarrie Trial Track•Keinbah Trial Track•Richmond Grove Trial Track•Sunny Lodge Education Centre•Tubbul Breaking In Centre•Wollondilly Trial Track.•

Prizemoney Incentive Scheme and Club Incentive SchemeIn July 2008, GRNSW introduced the Club Incentive Scheme which was established to encourage clubs to pay additional prizemoney over and above what they receive from GRNSW in monthly distribution payments. This scheme rewards clubs that pay additional prizemoney by providing them with an incentive payment based on the amount of additional prizemoney they distribute to participants throughout the financial year.

In its first two years, the Club Incentive Scheme has been successful in encouraging clubs to pay additional prizemoney, with an extra $703,000 in 2008/09 and an extra $1,048,000 in 2009/10 being distributed to participants in NSW.

Live SitesGRNSW introduced ‘Live Sites’ for membership renewals in September 2009. Over 6,000 renewals were processed at 11 regional and metropolitan sites over a month, providing participants of the sport with a convenient face-to-face way of renewing their memberships.

The ‘Live Sites’ gave the GRNSW team a chance to meet participants on a one-to-one basis and answer questions about services while they were waiting to have their memberships renewed.

GRNSW is committed to continually improving the membership renewal process to make it more convenient and user friendly, reducing the burden of having to travel into the Sydney offices or send renewals via mail. As part of this commitment, GRNSW plans to increase the number of ‘Live Sites’ across the state as part of the 2011/12 membership renewal process.

Ratio Benchmark Metropolitan Premier Principal Country__________________________________________________________________________________________________________ 2010 2009 2010 2009 2010 2009 2010 2009__________________________________________________________________________________________________________Prizemoney >100% 102% 77% 104% 102% 110% 106% 110% 114%__________________________________________________________________________________________________________Expenses <50% 33% 37% 40% 39% 26% 31% 43% 44%__________________________________________________________________________________________________________Entrepreneurship >20% 28% 36% 41% 43% 34% 31% 76% 85%__________________________________________________________________________________________________________Race Day Margin >50% 56% 66% 77% 92% 67% 37% 93% 102%__________________________________________________________________________________________________________Financial Result >0% 6% 9% 2% 8% 9% 8% 3% 0%__________________________________________________________________________________________________________Maintenance >100% 600% 650% 330% 294% 208% 226% 343% 320%__________________________________________________________________________________________________________Notes: The benchmark for the prizemoney ratio for Metropolitan was 75% in 2009 but 100% in 2010

SECTOR AVERAGES

Performance Ratio

Prizemoney Ratio

Expense Ratio

Entrepreneurship Ratio

Race Day Margin Ratio

Financial Results Ratio

Maintenance Ratio

Objective

To ensure distribution income is used largely for prizemoney

To manage clubs efficiently by keeping operating expenses to a minimum

To maximise non-distribution income to assist in boosting prizemoney and expenditure on on-course facilities

To manage race day activities effectively

To achieve a surplus to assist in building working capital to withstand an adverse event

To undertake routine maintenance to prevent physical assets deteriorating and becoming unsafe and unsightly

How it is Measured

Prizemoney / Distribution

(Total Expenses - Prizemoney) / Total Income

(Total Income - Distribution - Grants) / Distribution

(Race Day Income - Distribution - Grants) / (Race Day Expenses - Prizemoney)

Net Income / Income

Year to date actual maintenance expenditure annualised against the standard as a percentage

SECTOR AVERAGES

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BRAND & PUBLIC RELATIONS

Major Event PromotionsBetfair 2009 NSW Greyhound of the Year AwardsThe Betfair 2009 NSW Greyhound of the Year awards proved to be even bigger than the previous year with a record 330 people - an increase of more than 30 per cent - attending the night at the Sydney Hilton. Judging from the big jump in attendance, it appears the revamped ceremony is becoming well-known within the sport and will continue as the major event of the year into the future.

Betting exchange Betfair came on board as official sponsor of the event. Their involvement also meant there was a new award presented for the best media coverage of greyhound racing by a regionally-based outlet, won by the Newcastle Herald for their extensive publicity of the National Derby and National Futurity at The Gardens.

Respected announcer Craig Willis hosted the evening with the popular Ken Cheetham taking home the top trophy for the deeds of his outstanding sprinter Take The Kitty. Bruce Fletcher accepted the Allen Wheeler Medal for excellence in the sport of greyhound racing in NSW on behalf of his father Percy Fletcher, whilst the Nowra club on the State’s South Coast was named Club of the Year.

The awards were well publicised with local media from regions where the award winners hailed publishing stories and photos from the night.

Macro Meats Golden Easter EggIn 2010/11 GRNSW signed on to become an event partner of the GBOTA for the Macro Meats Golden Easter Egg, with a particular emphasis on the marketing and public relations activities surrounding the series.

With the flagship event of the Australian Group racing calendar carrying a $250,000 first prize and the tag of the richest free entry race in the world, a comprehensive media campaign was carried out nationally.

Contacts were established right across Australia and at the conclusion of the Carnival, 146 mentions of the Golden Easter

Egg were recorded either in print or online, as well as through radio and broadcast mediums.

GRNSW looks forward to increasing the profile of this major event, particularly internationally, with the 2011 version set to be elevated to be the world’s richest greyhound race.

GRNSW Country Challenge The 2009/10 GRNSW Country Challenge series, once again, was a major part of the Marketing and Public Relations team’s activities throughout the 2009/10 financial year. Structured marketing and public relations campaigns were carried out with local media at all 28 venues throughout the series and the interest generated from the statewide series was a major boost for the sport.

GRNSW will continue to work closely with clubs and the media to promote the Country Challenge and it is anticipated the series will continue to go from strength to strength in 2010/11. This will be facilitated by the advent of The Dogs TV which enhances GRNSW’s ability to reach regional broadcast media through the direct supply of race vision and audio.

Media ExposureAcross the year there were more than 1,200 articles, radio and television spots in the NSW media with mentions of GRNSW or its programs. This figure also includes any mention of greyhounds in metropolitan media.

This equates to more than six hours and 15 minutes of radio and TV airtime and a cumulative viewing audience of 193 million people across the entire country. Associated with the print articles there were also 289 photographs published featuring greyhound racing during the year.

The following programs, events and issues received regular coverage during the 2009/10 financial year : the GRNSW Country Challenge; Betfair 2009 NSW Greyhound of the Year; Greyhounds As Pets; the Macro Meats Golden Easter Egg; and Race Fields Legislation.

OPERATIONS REVIEw

The world’s richest free entry greyhound race The Macro Meats Golden Easter Egg

Minister for Gaming and Racing Kevin Greene MP at the Betfair 2009 NSW Greyhound

of the Year Awards

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Club Partnership GrantIn 2005/06 GRNSW introduced the Club Partnership Grant (CPG). The grant provides funding assistance to all clubs for their marketing and promotional activities, whilst giving them a level of autonomy and control over the methods of advertising employed.

A sliding scale of $16,000, $8,000, $4,000 and $2,000 is made available each year for metropolitan, premier, principal and country racing clubs.

Some of the successful local promotional activities that were undertaken by clubs over the past year using the CPG included:

The Muswellbrook and Potts Park clubs used the CPG to fund •a special free entry day for their major events, which provided a welcome increase of patron numbers for both clubs. The promotion was supported by local newspaper advertisingWentworth Park hired a large inflatable video screen to show •replays to the crowd during Group races at the track. The screen allowed fans to see highlights of races and not miss a minute of the on track action at the venue

CPG funding was also made available to Gosford to hire a variable messaging board which was placed at the entrance to the town centre to promote major events. The board, similar to those used by the RTA for traffic management, became effective in promoting the club to locals and visitors alike.

A number of clubs again used the CPG to help fund the placement of a television campaign on regional TV stations across the state to promote the GRNSW Country Challenge Series.

CommunicationsThe past year has proven to be one of great success for the thedogs.com.au website.

The website has continued to grow since going live in November 2008 and currently boasts more than 10,000 members. Widely recognised as a one-stop-shop for greyhound racing enthusiasts, it is anticipated membership of the website will continue to increase.

The monthly E-Chaser newsletter has also built up a loyal following having replaced the former printed magazine. GRNSW remains committed to providing three free weekly newsletters, with The Friday Gospel proving the most popular with a large increase in subscribers during 2009/10.

The expert tips and analysis from a panel of industry respected journalists mean subscribers can access all the latest information

from their email inbox up to three times a week.A special Egg Basket newsletter was also commissioned for six weeks to coincide with the Macro Meats Golden Easter Egg.

GRNSW offers the most comprehensive greyhound form service in Australia. All form on thedogs.com.au website is now free after the fee charged for the use of the premium form guide was discontinued in July 2010.

A new and popular addition to the website has been the race replays, which are uploaded for all TAB tracks. The addition of race replays allows keen punters to conduct their own form analysis and more than 91,000 race replayswere viewed during 2009/10, proving how popular they are with website visitors.

Overall, website traffic has continued to increase, particularly since the start of the 2010 calendar year. There have been almost 197,000 unique visitors to the website in the past financial year and 1.44 million visits across this time. A total of 8.74 million pageviews have been recorded and the average time a visitor now spends on the website is around 8½ minutes - up from seven minutes in 2008/09.

The most popular pages up until the end of June 2010 were the race results pages and the expert formguides.

Other Online ActivitiesCommunication activities have not just been restricted to thedogs.com.au website. GRNSW has established a Facebook page and Twitter account to make the most of social media communication opportunities.

As of July 2010, the Facebook page had 680 fans and Twitter account 748 followers. Both of these channels have proven extremely

useful in promoting greyhound racing in NSW with regular interaction taking place. Fans and followers have not only interacted with each other, they have also provided advice on how GRNSW can improve all facets of the business in an open and public forum.

Another exciting development in the communications area of the business has been the recent launch of The Dogs TV, which will inform and entertain enthusiasts through a variety of different content dedicated to greyhound racing. Hosted on a brand new portal, The Dogs TV can be viewed at any time and takes advantage of one of the newest communication mediums in online video. The progressive nature of The Dogs TV will ensure GRNSW is at the cutting edge of stakeholder communication.

Simon Ma collects the $10,000 bonus as trainer of GRNSW Country Challenge Champion

Tadmore Buckshot

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GRNSW undertook an organisational restructure in July 2010 to ensure there are distinct business units responsible for the delivery of the strategies under each pillar of the new strategic plan Chasing 2020. The new structure sees four core business units within GRNSW: Racing & Integrity, Member & Club Services, Brand & Public Relations and Growth & Sustainability. The functions of each business unit under the new structure are as follows:

Racing & Integrity•Stewarding•Racedayoperations•Inquiries•Grading•Raceprogramming•Kennelinspections•Branding,marking&identification•Determiningeligibilityofnewlicenseapplicants•Dealingwithinquiriesrelevanttogreyhoundbreedingactivities•Veterinarymatters Member & Club Services•Processingofalllicensingandregistrationtransactions•Schemeofdistributionpayments•OperatingStandards•Clubsupportonrecurrentfundingissues

Brand & Public Relations •Media&issuesmanagement•Publications&e-communications•Website•Raceformservices•Communityengagement•Events&promotions Growth & Sustainability •Wagering•Intellectualpropertydevelopment•GIDFandcapitalplanning•Ownership&syndication•Animalwelfare•GreyhoundsasPets•Breedingprograms(BluePaws)•Membershipeducationinitiatives

DARREN SIMPSONChief Operating Officer

BRENT HOGANChief Executive

LEADERSHIPGROUP

BILL FANNINGGeneral Manager Racing & Integrity

PATRICK HALLINANPolicy Advisor

KATRINA MCHATTANGM, Member & Club Services

TONY RICHENSGM, Brand & Public Relations

TONY O’MARAGM, Growth & Sustainability

ORGANISATIONAL STRUCTURE

21

Established under the Greyhound Racing Act 2009, the Greyhound Racing Industry Consultation Group (GRICG) has the function of consulting with and making recommendations to GRNSW on matters concerning greyhound racing in NSW.

GRICG is required to meet at least 6 times a year. The members of GRICG are honorary and no remuneration is payable to them in respect of the duties they perform.The current membership of GRICG is as follows:

Bryan Young (Chair)

NSW Greyhound Breeders Owners and Trainers Association

Christine Mackenzie (Deputy Chair)

TAB Clubs Representative

Ron Arnold

Country Clubs Representative

Bob Green

NSW Greyhound Breeders Owners and Trainers Association

Mark Merlino

Bookmakers representative

Roy white

Registered Greyhound Participants Association

The Board of GRNSW is committed to developing and ensuring GRICG is an active channel for consultation and discussion of industry issues.

GRICG Chairman’s ReportGRICG held its inaugural meeting on 22 February 2010 at which time I was elected Chairman. Three further meetings were held up until June 2010, including one formal audience with the GRNSW Board. A number of important operational and industry related issues were discussed at these meetings, including:

GRNSW strategic direction•TAB C grading policy•TAB racing calendar formulation•Timely payment of swab monies•Equalisation of “Premier v Principal” funding at TAB tracks •GRNSW customer service issues.•

GRICG prepared a number of written submissions on these issues which were put forward to the GRNSW Board for consideration. Formal GRNSW responses to these submissions can be found on thedogs.com.au website.

GRICG is still in its infancy and many participants are not aware of our existence, how to contact us or what issues we have considered to date. As a result, GRICG has decided to develop and implement a communication strategy during 2010/11 that will incorporate the following:

A dedicated information section on thedogs.com.au website •which will contain copies of meeting minutes, written submissions and an issues tracking registerA dedicated post office box to facilitate participant feedback•Media exposure through a focus piece in The Greyhound •Recorder.

GRICG is committed to ensuring the interests of participants are represented and considered by GRNSW when formulating new policy or changes to existing policies.

The members of GRICG look forward to maintaining a constructive dialogue with participants in the future, as part of our vision to drive ongoing improvements in our great sport.

Bryan Young GRICG Chairman

GREYHOUND RACING INDUSTRY CONSULTATION GROUP

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STATISTICS

Minimum average paying customers

per meeting per annum

Minimum average nominations per meeting per annum

Minimum average starters per

meetingper annum___________________________________________________________________________________________________________

Club B’mark Actual B’mark Actual B’mark Actual___________________________________________________________________________________________________________Wentworth Park (GBOTA) Saturday 400 670 100 100 75 77___________________________________________________________________________________________________________Wentworth Park (GBOTA) Monday 180 315 100 103 75 74______________________________________________________________________________________________________________________________________________________________________________________________________________________Bulli (GBOTA) 110 126 100 122 75 75___________________________________________________________________________________________________________Dapto 110 165 * 100 111 75 77___________________________________________________________________________________________________________Gosford (GBOTA) 110 179 100 145 75 78___________________________________________________________________________________________________________Lismore (GBOTA) 110 141 100 115 75 75___________________________________________________________________________________________________________Richmond 110 98 100 121 75 78___________________________________________________________________________________________________________The Gardens (NCA) 110 149 100 131 75 77___________________________________________________________________________________________________________ ___________________________________________________________________________________________________________Bathurst (GBOTA) 90 96 100 120 75 76___________________________________________________________________________________________________________Casino 90 142 100 143 75 93___________________________________________________________________________________________________________Maitland (GBOTA) 90 125 100 114 75 76___________________________________________________________________________________________________________Shoalhaven 90 96 100 130 75 78___________________________________________________________________________________________________________ ___________________________________________________________________________________________________________Appin (GBOTA) 70 92 80 80 75 69___________________________________________________________________________________________________________Armidale 70 75 80 91 75 71___________________________________________________________________________________________________________Bathurst Non-TAB (GBOTA) 70 98 80 90 75 73___________________________________________________________________________________________________________Broken Hill # 70 64 69 64 65 61___________________________________________________________________________________________________________Coonabarabran 70 94 80 92 75 77___________________________________________________________________________________________________________Coonamble # 70 108 72 70 68 63___________________________________________________________________________________________________________Cowra 70 76 80 88 75 77___________________________________________________________________________________________________________Dapto Non-TAB ^ 70 120 * 90 115 85 83___________________________________________________________________________________________________________Dubbo ^ 70 95 83 90 77 74___________________________________________________________________________________________________________Forbes ^ 70 65 87 79 81 74___________________________________________________________________________________________________________Goulburn 70 87 80 99 75 84___________________________________________________________________________________________________________Grafton 70 113 80 89 75 75___________________________________________________________________________________________________________Gunnedah (GBOTA) ^ 70 81 86 111 81 87___________________________________________________________________________________________________________Kempsey 70 104 80 108 75 86___________________________________________________________________________________________________________Lithgow 70 90 80 112 75 93___________________________________________________________________________________________________________Moree # 70 61 71 88 66 76___________________________________________________________________________________________________________Mudgee 70 84 80 67 75 61___________________________________________________________________________________________________________Muswellbrook 70 94 80 107 75 75___________________________________________________________________________________________________________Potts Park 70 96 80 109 75 77___________________________________________________________________________________________________________Shoalhaven Non-TAB ^ 70 100 95 90 89 77___________________________________________________________________________________________________________Tamworth (NCA) 70 51 80 85 75 78___________________________________________________________________________________________________________Taree 70 89 80 113 75 85___________________________________________________________________________________________________________Temora (GBOTA) ^ 70 73 89 119 83 86___________________________________________________________________________________________________________The Gardens Non-TAB (NCA) 70 154 80 120 75 87___________________________________________________________________________________________________________Tweed Heads 70 174 80 92 75 72___________________________________________________________________________________________________________Wagga Wagga 70 107 80 103 75 76___________________________________________________________________________________________________________Wauchope 70 88 80 90 75 73___________________________________________________________________________________________________________Young 70 69 80 84 75 74___________________________________________________________________________________________________________ Notes: * Dapto does not charge admission # Broken Hill, Coonamble and Moree were on the Isolated Club Funding Model and therefore had revised racing benchmarks ^ Dapto Non-TAB, Dubbo, Forbes, Gunnedah, Shoalhaven Non-TAB and Temora were on the Flexible Funding Model and therefore had revised racing benchmarks

Club Statistic Summary

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Club / Entity MVIA Funding VEMP Funding Other Funding TOTAL GIDF ___________________________________________________________________________________________________________GHRRA -21,474.74 -21,474.74 ___________________________________________________________________________________________________________GRNSW 848,170.66 848,170.66 ___________________________________________________________________________________________________________Bankstown Slipping Track 15,000.00 15,000.00 ___________________________________________________________________________________________________________Armidale 19,597.99 19,597.99 ___________________________________________________________________________________________________________Broken Hill 20,297.23 20,297.23 ___________________________________________________________________________________________________________Casino 23,923.98 23,923.98 ___________________________________________________________________________________________________________Coonabarabran 457.00 457.00 ___________________________________________________________________________________________________________Coonamble 19,582.10 19,582.10 ___________________________________________________________________________________________________________Cowra 4,766.74 4,766.74 ___________________________________________________________________________________________________________Dapto -2,130.00 10,000.00 7,870.00 ___________________________________________________________________________________________________________Dubbo 9,523.27 80,550.00 90,073.27 ___________________________________________________________________________________________________________Forbes 3,536.00 3,536.00 ___________________________________________________________________________________________________________GBOTA - Appin 21,498.57 21,498.57 ___________________________________________________________________________________________________________GBOTA - Bathurst 11,523.48 11,523.48 ___________________________________________________________________________________________________________GBOTA - Bulli 20,184.86 6,244.90 26,429.76 ___________________________________________________________________________________________________________GBOTA - Gosford 17,036.37 6,900.00 23,936.37 ___________________________________________________________________________________________________________GBOTA - Gunnedah 10,076.55 31,200.00 41,276.55 ___________________________________________________________________________________________________________GBOTA - Lismore 35,978.37 35,978.37 ___________________________________________________________________________________________________________GBOTA - Maitland 26,655.88 124,250.00 150,905.88 ___________________________________________________________________________________________________________GBOTA - Temora 2,547.36 2,547.36 ___________________________________________________________________________________________________________GBOTA - Wentworth Park 41,861.90 41,861.90 ___________________________________________________________________________________________________________Goulburn 7,664.18 7,664.18 ___________________________________________________________________________________________________________Grafton 9,299.81 81,656.01 90,955.82 ___________________________________________________________________________________________________________Greyhound Social Club (Potts Park) 8,840.06 156,204.00 165,044.06 ___________________________________________________________________________________________________________Hastings River (Wauchope) 3,727.27 3,727.27 ___________________________________________________________________________________________________________Kempsey 4,045.45 3,890.50 7,935.95 ___________________________________________________________________________________________________________Lithgow 9,800.00 7,000.00 16,800.00 ___________________________________________________________________________________________________________Moree 0.00 ___________________________________________________________________________________________________________Mudgee 2,300.00 2,300.00 ___________________________________________________________________________________________________________Muswellbrook 7,863.00 37,340.91 45,203.91 ___________________________________________________________________________________________________________NCA - Tamworth 8,285.25 8,285.25 ___________________________________________________________________________________________________________NCA - The Gardens 33,643.69 64,637.27 98,280.96 ___________________________________________________________________________________________________________Richmond 38,796.08 59,132.15 21,513.43 119,441.66 ___________________________________________________________________________________________________________Shoalhaven 0.00 ___________________________________________________________________________________________________________Taree 1,133.64 1,133.64 ___________________________________________________________________________________________________________Tweed Heads 0.00 ___________________________________________________________________________________________________________Wagga Wagga 11,163.80 11,163.80 ___________________________________________________________________________________________________________Young 5,432.79 5,432.79 ___________________________________________________________________________________________________________TOTALS 397,050.77 59,132.15 1,514,944.84 1,971,127.76 ___________________________________________________________________________________________________________

GIDF ACTIVITY

24

Greyhounds____________________________________________________

Year Litters Registered Greyhounds Named____________________________________________________

2002-03 1320 5383____________________________________________________

2003-04 1310 6218____________________________________________________

2004-05 1540 5364____________________________________________________

2005-06 1625 6434____________________________________________________

2006-07 1336 6039____________________________________________________

2007-08 1313 6054____________________________________________________

2008-09 1305 5505____________________________________________________

2009-10 1306 6595____________________________________________________

Participants Trainers____________________________________________________

Year Trainers Owner/Trainers Attendants____________________________________________________

2002-03 1770 5243 1116____________________________________________________

2003-04 1498 4282 748____________________________________________________

2004-05 1687 4698 936____________________________________________________

2005-06 1497 4215 700____________________________________________________

2006-07 1690 4534 802____________________________________________________

2007-08 1607 2653 1400____________________________________________________

2008-09 1753 2704 1502____________________________________________________

2009-10 1553 2329 1233____________________________________________________

Owner/Trainers and Attendants categories reclassified owner/trainer from 1 July 2007

wagering and Racing

NSw Greyhound Market Share by wagering Provider ____________________________________________________

Market Share____________________________________________________

Totalisators 83.68%____________________________________________________

Corporate Bookmakers 13.21%____________________________________________________

Betting Exchanges 3.11%____________________________________________________

Total 100%____________________________________________________

STATISTICS

25

2006 2007 2008 2009 2010 ________________________________________________________________________________________________________

Racing Activity Number of Race Meetings Conducted ________________________________________________________________________________________________________Metropolitan 104 106 105 106 104 ________________________________________________________________________________________________________TAB 611 509 529 523 631 ________________________________________________________________________________________________________Non-TAB 712 687 738 753 747 TAB C are shown here ________________________________________________________________________________________________________

Number of Races Conducted ________________________________________________________________________________________________________Metropolitan 1,040 1,058 1,050 1,068 1,040 ________________________________________________________________________________________________________TAB 6,245 5,182 5,396 5,287 5,339 ________________________________________________________________________________________________________Non-TAB 7,698 7,411 7,870 7,890 7,852 TAB C are shown here ________________________________________________________________________________________________________

Number of Starters ________________________________________________________________________________________________________Metropolitan 8,018 8,122 8,112 8,122 7,966 ________________________________________________________________________________________________________TAB 47,687 39,946 41,657 40,760 41,007 ________________________________________________________________________________________________________Non-TAB 56,973 54,960 58,107 57,320 57,304 TAB C are shown here ________________________________________________________________________________________________________

Participant Returns Total Prizemoney paid ________________________________________________________________________________________________________Metropolitan 5,907,345 5,576,476 5,594,554 6,246,067 6,785,935 ________________________________________________________________________________________________________TAB 6,526,720 6,105,819 6,598,967 7,952,697 9,989,882 ________________________________________________________________________________________________________Non-TAB 3,067,654 3,145,190 3,063,458 3,234,822 4,163,472 TAB C are shown here ________________________________________________________________________________________________________

Total Prizemoney paid as a percentage of distribution received ________________________________________________________________________________________________________Metropolitan 76% 76% 76% 77% 102% ________________________________________________________________________________________________________TAB 76% 83% 80% 103% 107% ________________________________________________________________________________________________________Non-TAB 93% 100% 95% 114% 110% TAB C are shown here ________________________________________________________________________________________________________

Consumer Activity Paying attendees at NSw greyhound meetings ________________________________________________________________________________________________________Metropolitan 36,382 36,252 43,019 45,618 51,378 ________________________________________________________________________________________________________TAB 80,119 67,188 63,495 64,334 62,062 ________________________________________________________________________________________________________Non-TAB 78,003 70,761 78,985 70,982 70,305 TAB C are shown here ________________________________________________________________________________________________________

Average paying attendees per meeting ________________________________________________________________________________________________________Metropolitan 350 342 410 430 494 ________________________________________________________________________________________________________TAB 131 132 120 123 98 ________________________________________________________________________________________________________Non-TAB 110 103 107 94 94 ________________________________________________________________________________________________________

On-course totalizator turnover on NSw greyhound meetings ________________________________________________________________________________________________________Metropolitan 8,600,226 7,131,389 7,204,572 7,761,102 7,598,177 ________________________________________________________________________________________________________TAB 16,727,760 13,709,393 17,631,686 14,520,691 14,207,473 ________________________________________________________________________________________________________Non-TAB 7,471,667 6,569,589 5,732,351 4,169,744 2,588,494 ________________________________________________________________________________________________________

Total TAB turnover on NSw greyhound meetings 277,084,500 249,193,350 268,091,511 270,078,774 280,021,090 ________________________________________________________________________________________________________

wagering Market share of NSw greyhound product with TAB Ltd 17.1% 17.0% 22.1% 17.1% 17.7% ________________________________________________________________________________________________________

Bookmaker turnover on NSw greyhound meetings 47,281,364 46,500,000 38,531,281 36,430,383 25,666,012 ________________________________________________________________________________________________________Government Revenue 18,362,390 16,514,043 17,766,424 17,898,120 18,556,998 Government revenue from TAB turnover on NSW greyhound meetings ________________________________________________________________________________________________________

FIVE YEAR COMPARISON

26

RACING REVIEw

2009/10 Racing Review Australia’s flagship Group racing event went to an unchartered level in 2009/10 when the Macro Meats Golden Easter Egg became the richest ever greyhound race staged in Australia - and indeed the richest free entry race in the world.

The theatre provided by the Macro Meats Golden Easter Egg underpinned a season in which six Group One features were staged in NSW in the midst of a hectic Group racing calendar.

Veteran sprinter Did I Entertain hinted at further things in store for the upcoming season when claiming a shock last-to-first victory in the NSW National Sprint Final in August. Did I Entertain, famously coming under the tutelage of Southern Highlands mentor Robert Arnold because he was first to reach a milk crate he had tossed in front of potential pups, went on to dominate the Wentworth Park sprinting scene claiming 11 wins at headquarters before the end of the 2009/10 season.

Smashing Amy waged a titanic battle with rank outsider Time To Play before eventually careering away to win the NSW National Distance Final.

Spring was in the air soon after, heralding the arrival of interstate raiders for the Group One classics, beginning with the NCA Paws of Thunder.

Beaten NSW National Sprint finalist Cosmic Rumble set tongues wagging with a blistering 29.64s run to headline the heat action, with star Victorian Dyna Lachlan clocking a slippery 29.79s. Only the latter would advance past the semi finals, with another scorching 29.74s performance.

At the short odds of $1.90 for the $100,000 to-the-winner final, Dyna Lachlan couldn’t muster

enough early speed from the favourable inside alley leaving the door ajar for a fellow Victorian in Cindeen Shelby to seize the advantage. Bred and owned out of the Hunter Valley, Cindeen Shelby led from wire to wire to record the first of her three Group One successes in 2009, having three lengths to spare from eventual Betfair 2009 NSW Greyhound of the Year Take The Kitty and in turn denying Dyna Lachlan the first Group triumph his connections so craved.

The Spring Carnival concluded with the first of the age restricted Group One events of the season in the form of the Schweppes Vic Peters Classic.

Bookmakers had trouble settling on a favourite for the event, which carried a $50,000 first prize, before eventually sending out Fancy Mandy the punters’ elect at $3.10 on the strength of her solid 30.23s semi final win.

But it was to be the Tracey Hurst trained Dancing Surf which would nab the event, producing a sizzling first section of 5.41s before eventually holding off a fast finishing Pedrosa to win by three-quarters-of-a-length in 30.25s.

Flipping the calendar into 2010, the nation’s best stayers ignited the Group One scene with the running of the time honoured Hotham Body Repairs Association Cup.

The series was notable for the inclusion of Graham Jose’s all distance marvel Mantra Lad and the Victorian wonder dog put everyone on notice when obliterating a reduced four dog field in the heats by 16 lengths in a sparkling 42.09s - just two-and-a-half-lengths shy of Chinatown Lad’s 720m record.

Pedrosa (middle) rounds the first bend in the NCA Paws Of Thunder final

National Derby hero Elite Blue Size

27

That record was widely tipped to come under serious threat in the final. The pre-race predictions, however, were not quite on the mark, but Australia’s premier stayer displayed all his class sweeping to a seventh consecutive win.

Stepping cleanly from the rails alley, Mantra Lad kept another versatile performer in reigning National Sprint Champion Dashing Corsair at arm’s length into the back straight before pulling away from the fading Queenslander, who eventually finished fifth, to clinch a deserved victory in 42.14s.

For just the second time, the Group One spotlight in NSW shifted provincially as The Gardens hosted the Newcastle Herald National Derby and Nexia Court National Futurity on a momentous night.

The Derby was memorable for the remarkable training effort of champion mentor Reg Kay. The affable Queenslander was calling Calga home after his shift south of the border, with his kennel immediately taking a liking to their new surrounds.

All the rage heading into the final, Kay boxed $1.60 hotpot Elite Blue Size as well as the classy Outa Credit. It was more than a little poetic when Elite Blue Size romped to a one length success from his jet heeled kennelmate in a fast 29.33s - just a length adrift of the then track record held by Kay’s former National Sprint king Knocka Norris. For a man who has achieved almost everything one can in greyhound racing, 2008 Australian Trainer of the Year Kay was so jubilant with the result he declared it a career highlight.

Much like the Derby, favourite backers were on good terms with themselves in the Futurity when the locally trained Daydream powered home to be the leading lady and deliver Brett May his watershed Group One victory. Joined in the final by littermate Bit Stressed, fastest qualifier Daydream railed hard through the first bend and the series was as good as settled once she scampered to a comfortable buffer in the back straight, eventually winning in a slick 29.62s.

The 2009/10 Group One calendar concluded on the best possible note with the running of the Macro Meats Golden Easter Egg. Interest in the Carnival spiralled to an unprecedented level with the announcement of a $250,000 winner’s purse - an increase of $100,000 from the 2009 event.

Bereft of a clear favourite with nominations flooding in from all over Australia, heat night saw a raft of potential winners tumble out of the series. Pre-post favourite and red hot Victorian Dyna

Lachlan went crashing out, along with the highly fancied Fedex, excitement machine Goodesy, recently crowned Betfair 2009 NSW Greyhound of the Year Take The Kitty, Hobart Thousand conqueror Prankster and 2009 finalist Joanne Monelli. However, everyone was talking about an electrifying fastest qualifying mark of 29.49s - the second fastest time ever recorded at Wentworth Park - set by Sydney bitch Fancy Mandy.Her form was again peerless in the semi finals, making a mockery of an awkward box four, leading from box rise in a sensational 29.70s scamper. It was class personified.

The unlikely final field brought together hopefuls from the three eastern states, with Victoria and Queensland leading the way with three representatives, while the home state was blessed with two.

Fancy Mandy held the majority of support from a captive hometown audience, ready to witness Australia’s richest ever greyhound race on a soggy Saturday night.

Odds-on to clinch the crown, Fancy Mandy bungled the start paving the way for the little known Victorian Banger Harvey to head up the field into the back straight. Leading gallantly all the

way into the home straight, Banger Harvey could not hold out his prodigiously strong Victorian rival Cosmic Rumble who speared to the front in the shadows of the post. Tardy out of the boxes, Cosmic Rumble quickly found the fence before peeling to the outside in the latter stages to deliver owner Steve Kavanagh his biggest thrill in the sport. Fancy Mandy finished a quick closing third.

Cosmic Rumble, who had quietly progressed through to the final on the back of commanding heat and semi final wins, etched master trainer Darren McDonald’s name into the record books as the first person to prepare multiple Golden Easter Egg winners in the 21 year history of the Easter Saturday spectacular.

Macro Meats Golden Easter Egg winner Cosmic Rumble

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2009/10 GRNSw COUNTRY CHALLENGE

The GRNSW Country Challenge continues to prosper with the 2009/10 series again offering more than $170,000 in prizemoney. It was the fourth year since the concept’s inception and more than 160 greyhounds managed to qualify for finals across the 28 tracks state wide.

The overall Country Challenge Champion is presented with a $10,000 bonus, while the K.S. Black & Co. Country Challenge Showdown features $20,000 in prizemoney.

There have been some great supporters of the Country Challenge over the past four years and their continued commitment to the series has contributed directly to its viability. The series continues to generate widespread interest across NSW with it warmly received by regional media whenever an event is staged at their local track.

Each Non-TAB club is allocated $5,000 in prizemoney to be used for the final of their event, triggering an immediate marquee race at each track throughout the state. Country clubs are also provided funding through the Club Partnership Grant, a proportion of which must be spent on promotion and advertising for their Country Challenge event.

GRNSW continued to provide public relations assistance for each club by engaging in dialogue with local media as well as periodic releases for each leg of the Country Challenge series. This helped initiate interest in the Country Challenge, resulting in coverage across a range of print, radio and television mediums.

In addition, a dedicated Country Challenge section on thedogs.com.au website continued to promote and inform participants about the series.

The entire Country Challenge series managed to generate 149 print media articles, 29 television stories and 27 radio spots in 2009/10 - a 61 per cent increase from the 2008/09 series.

More than 51 minutes of airtime was achieved on radio and television. This equates to overall free to air media promotion reaching just over 2.75 million people across the state.

The format of the Country Challenge

series continues to work well with greyhounds accumulating points depending on their finishing position in finals across the state. While the Showdown event traditionally provides regional based connections a special night at Wentworth Park and something to work towards when the honour of overall Country Challenge Champion may be out of reach.

The 2009/10 winner was the Simon Ma trained Tadmore Buckshot who sealed the $10,000 bonus with victory at Gunnedah. Defending Showdown champion Future Fund again filled the runner-up position after an injury interrupted season.

The K.S. Black & Co. Country Challenge Showdown was won by former Group winner True Kihael, who needed a count back to scrape into the final field after finishing ninth on the standings.

Final 2009/10 LeaderboardGreyhound PointsTadmore Buckshot 49

Future Fund 35

Bellbird Park 26

Devine Ruler 26

Aye Oh Kay 25

Mighty Albert 22

Prince Eragon 21

Devine Rush 18

True Kihael 16

Eagleton Lad 16

Kim Hyde and K.S. Black & Co. Country Challenge Showdown winner True Kihael

29

30

FREEDOM OF INFORMATION

FOI Requests Personal Other Total 2008/09 2009/10 2008/09 2009/10 2008/09 2009/10A1 New (including transferred in) 0 0 6 2 6 2_______________________________________________________________________________________________________A2 Brought forward 0 0 0 0 0 0_______________________________________________________________________________________________________A3 Total to be processed 0 0 6 2 6 2_______________________________________________________________________________________________________A4 Completed 0 0 6 2 6 2_______________________________________________________________________________________________________A5 Transferred out 0 0 0 0 0 0_______________________________________________________________________________________________________A6 Withdrawn 0 0 0 0 0 0_______________________________________________________________________________________________________A7 Total Processed 0 0 6 2 6 2_______________________________________________________________________________________________________A8 Unfinished (carried forward) 0 0 0 0 0 0

FOI Requests Personal Other Total 2008/09 2009/10 2008/09 2009/10 2008/09 2009/10B1 Granted in full 0 0 0 0 0 0_______________________________________________________________________________________________________ B2 Granted in part 0 0 4 1 4 1_______________________________________________________________________________________________________ B3 Refused 0 0 2 1 2 1_______________________________________________________________________________________________________ B4 Deferred 0 0 0 0 0 0_______________________________________________________________________________________________________ B5 Completed 0 0 6 2 6 2

Ministerial Certificates 2008/09 2009/10_______________________________________________________________________________________________________C1 Ministerial Certificates issued during the period 0 0

FOI requests granted in part or refused Personal Other 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________G1 S.19 {application incomplete,wrongly directed} 0 0 0 0_______________________________________________________________________________________________________ G2 S.22 {deposit not paid} 0 0 0 0_______________________________________________________________________________________________________ G3 S.25(1)(al) {diversion of resources} 0 0 0 0_______________________________________________________________________________________________________ G4 S.25(1)(a) {exempt} 0 0 5 2_______________________________________________________________________________________________________ G5 S.25(1)(b),( c),(d) {otherwise available} 0 0 0 0_______________________________________________________________________________________________________ G6 S.28 (1)(b) {documents not held} 0 0 1 0_______________________________________________________________________________________________________ G7 S.24 (2) {deemed refused, over 21 days} 0 0 0 0_______________________________________________________________________________________________________ G8 S.31 (4) {released to Medical Practitioner} 0 0 0 0_______________________________________________________________________________________________________ G9 Totals 0 0 6 2

Formal Consultations Issued Total 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________D1 Number of requests requiring formal consultations 2 1 2 1

Notation of personal records 2008/09 2009/10_______________________________________________________________________________________________________F1 Number of requests for notation 0 0

Result of Amendment Request Total 2008/09 2009/10_______________________________________________________________________________________________________ E1 Result of amendment-agreed 0 0_______________________________________________________________________________________________________ E2 Result of amendment-refused 0 0_______________________________________________________________________________________________________ E3 Total 0 0

31

Costs and fees of requests processed Assessed Costs FOI Fees Received during the period 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________H1 All completed requests $1,805 $380 $1,805 $380

Type of discount allowed Personal Other 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________ I1 Public interest 0 0 0 0_______________________________________________________________________________________________________ I2 Financial hardship-pensioner / child 0 0 0 0_______________________________________________________________________________________________________ I3 Financial hardship-non-profit organisation 0 0 0 0_______________________________________________________________________________________________________ I4 Totals 0 0 0 0_______________________________________________________________________________________________________ I5 Significant correction of records 0 0 0 0

Elapsed time Personal Other 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________ J1 0-21 days 0 0 3 1_______________________________________________________________________________________________________ J2 22-35 days 0 0 3 1_______________________________________________________________________________________________________ J3 over 35 days 0 0 0 0_______________________________________________________________________________________________________ J4 Totals 0 0 6 2

Processing hours Personal Other 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________ K1 0-10 hours 0 0 6 2_______________________________________________________________________________________________________ K2 11-20 hours 0 0 0 0_______________________________________________________________________________________________________ K3 21-40 hours 0 0 0 0_______________________________________________________________________________________________________ K4 over 40 hours 0 0 0 0_______________________________________________________________________________________________________ K5 Totals 0 0 6 2

Reviews and Appeals finalised 2008/09 2009/10_______________________________________________________________________________________________________ L1 Number of internal reviews finalised 5 2_______________________________________________________________________________________________________ L2 Number of Ombudsman reviews finalised 0 1_______________________________________________________________________________________________________ L3 Number of Tribunal reviews finalised 2 0_______________________________________________________________________________________________________ L3 Number of Supreme Court Appeals finalised 0 0

Basis of internal review Personal Other Upheld Varied Upheld Varied 2008/09 2009/10 2008/09 2009/10 2008/09 2009/10 2008/09 2009/10_______________________________________________________________________________________________________ L5 Access refused 0 0 0 0 0 0 0 0_______________________________________________________________________________________________________ L6 Deferred 0 0 0 0 0 0 0 0_______________________________________________________________________________________________________ L7 Exempt matter 0 0 0 0 5 2 0 0_______________________________________________________________________________________________________ L8 Unreasonable charges 0 0 0 0 0 0 0 0_______________________________________________________________________________________________________ L9 Charge unreasonably incurred 0 0 0 0 0 0 0 0_______________________________________________________________________________________________________ L10 Amendment refused 0 0 0 0 0 0 0 0_______________________________________________________________________________________________________ L11 Total 0 0 0 0 5 2 0 0

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THE BOARD

Professor Percy Allan AMBEc, MEc, FIPAA, FAICD, FAIM, FCPA Australia, Trustee of CEDA

Chairman

Professor Allan is a Visiting Professor at Macquarie University’s Graduate School of Management and an Adjunct Professor in Public Policy at the School of Business and Government, University of Canberra.

He is Principal of Percy Allan and Associates Pty Ltd, a public policy, finance and management advisory group and Chairman of Constellation Capital Management Ltd, an Australian equities wholesale funds manager.

Professor Allan was Chairman of the NSW Government’s Council on the Cost and Quality of Government from 1999 to 2007. He was with the NSW Treasury for 18 years, nine of them as Secretary of the Department and Chairman of the NSW Treasury Corporation.

In 1996, Professor Allan was awarded an Order of Australia for his contribution to public sector reform. He has been the Chairman of GRNSW since its inception.

Jack Primmer

Nominated by TAB Clubs

Mr Primmer was first appointed TAB Clubs Representative on the Board of Greyhound Racing New South Wales in April 2005. Mr Primmer has long had an active interest in all codes of racing, from breeding activities to racing.

He has been a member of the Dapto Agricultural & Horticultural Society since 1982 and the Chairman of that organisation and of the Dapto Greyhound Racing Club since 1991. Mr Primmer was also a member of the Board of the former Greyhound Racing Authority for a three year term.

A Company Director for over 35 years, Mr Primmer is the proprietor of Jack Primmer Electronics.

Mr Primmer is also a Director of Greyhound Media Services Pty Ltd.

Gabriel (Bill) Mangafas

Nominated by the NSW Greyhound Breeders Owners & Trainers Association (GBOTA)

Mr Mangafas has been the NSW GBOTA’s nominee on the Board of Greyhound Racing New South Wales since its inception. He was a licensed greyhound owner/trainer for 31 years and in 1992 he formed the Camden Branch of the GBOTA, before being appointed as a Director of the NSW GBOTA in 1995. He was the NSW GBOTA’s Treasurer from 1996 to 2000 and was the Chairman of that organisation from 2000 to 2010.

Mr Mangafas is the elected Vice Chairman of the Wentworth Park Sporting Complex Trust, and a member of the Gosford Showground Trust and Bulli complex committee. He is the immediate past Chairman of the Australian Greyhound Racing Association, and is a delegate of the Metropolitan Racing Association and the Australian Federation of Greyhound Breeders, Owners & Trainers’ Associations.

Mr Mangafas has been the proprietor and/or General Manager of a number of companies and is currently employed as a consultant.

33

Murray Nicol MBA (MGSM)

Nominated by the NSW National Coursing Association (NCA)

Mr Nicol was appointed to the Board of Greyhound Racing New South Wales in May 2008 as nominee of the NSW NCA. Mr Nicol is currently the President of the New South Wales NCA.

His 40 years experience in nearly all facets of the Gaming and Wagering Industry commenced with the NSW TAB in 1969.

He also formerly held senior positions with AWA Totalisators, Club KENO, Stargames and Shuffle Master Inc USA and consulting positions to NSW Racing, Tabcorp Victoria and Sportsbet Australia (NT).

Tom Green

Nominated by country racing clubs

Mr Green founded the Greyhound Social Club Limited in 1963 and held the position of Chief Executive Officer of that Club for a period of 35 years. Upon his retirement from that role Mr Green was appointed to the Board of Directors of the Club and has held the position of President since that time.

A first time appointee to the Board of GRNSW, Mr Green was a member of the Greyhound Racing Control Board between 1987 and 1992 serving three of those years as Deputy Chairman. During his term on the Greyhound Racing Control Board, Mr Green was the greyhound racing appointee on the Board of the NSW Totalisator.

In 2000 Mr Green was awarded the Australian Sports Medal by the Commonwealth for services to the sport of greyhound racing. In 2002 he was appointed to the position of Assessor for greyhound racing on the Greyhound Racing Appeals Tribunal.

Mr Green is also the President of the Greyhound Racing Clubs Association.

Joyce Alamango

Representing industry participants

Mrs Alamango was first appointed in February 2008 to the Board of GRNSW as the representative of industry participants. Mrs Alamango has been an active owner and trainer in greyhound racing for over 32 years.

Mrs Alamango was a member of the Greyhound Racing Authority Board between 2001 and 2003. She was the Trainers representative on the Greyhound Racing Industry Participants Advisory Committee (GRIPAC) and is currently the Secretary of the Registered Greyhound Participants Association (RGPA). Mrs Alamango currently serves as the deputy representative to the Chief Operating Officer on the Wentworth Park Trust Board.

Apart from the greyhound industry, Mrs Alamango also runs her own small business.

34

MembersMembers of the GRNSW Board are appointed under the Greyhound Racing Act 2009. The names and particulars of the Board Members in office on the day this report is made out are as indicated on pages 32 and 33.

Board Membership Changes Board Members are appointed for a term of three years under the Greyhound Racing Act 2009. The current term expires in February 2012.

There have been no changes to the GRNSW Board in the 2009/10 financial year. Meetings of Board MembersDuring the financial year, the Board met 15 times. In addition, there were two Special Board meetings during that period. Attendance at meetings was as follows: ____________________________________________________

Board Members Attended Held____________________________________________________

P. Allan 15 17____________________________________________________

M. Nicol 16 17____________________________________________________

G. Mangafas 17 17____________________________________________________

J. Primmer 15 17____________________________________________________

T. Green 17 17____________________________________________________

J. Alamango 17 17____________________________________________________

During the period 1 July 2009 to June 30 2010 there were no occasions when substitute delegates attended meetings of the Board:

Meetings of Board CommitteesThe Board of GRNSW has established two Committees to consider matters relating to the functions below, as well as other matters as allocated to each Committee by the Board of GRNSW from time to time, and to prepare reports and recommendations on such matters for the Board to consider as a whole.

Each Committee consists of at least three permanent members. The appointed permanent members form the core membership of each Committee. However any member of the Board who is not a permanent member of a Committee may attend any meeting of the Committee.

Audit and Compliance CommitteeThe Audit and Compliance Committee is responsible for overseeing and appraising the quality of the external audit and the internal control procedures, as well as setting, reviewing

and ratifying corporate compliance policies, and overseeing the implementation of a corporate compliance system regarding financial, policy and employment issues, with a particular focus on: • Financialreportingandpractices• Businessethics,policiesandpractices• Accountingpolicies• Managementandinternalcontrols.

During the financial year, the Audit Committee met on one occasion.____________________________________________________

Committee Members Attended Held____________________________________________________

P. Allan (Chair) * 1 1____________________________________________________

T. Green* 1 1____________________________________________________

J. Primmer* 1 1____________________________________________________

M. Nicol 0 1____________________________________________________

G. Mangafas 1 1____________________________________________________

J. Alamango 1 1____________________________________________________

* Core Members of Committee

Remuneration and Nomination CommitteeThe Remuneration and Nomination Committee is responsible for recommending to the Board:• TheappointmentofaCEO• Recommendationofpolicyforpaymentofremuneration and allowances of Directors/members• UndertakingadetailedreviewoftheCEO’sperformance.

During the financial year, the Remuneration and Nomination Committee met on one occasion.

____________________________________________________

Committee Members Attended Held____________________________________________________

P. Allan (Chair) * 1 1____________________________________________________

T. Green * 1 1____________________________________________________

J. Primmer * 1 1____________________________________________________

M. Nicol * 1 1____________________________________________________

G. Mangafas * 1 1____________________________________________________

J. Alamango * 1 1____________________________________________________

* Core Members of Committee

Honorary HistorianJohn Tracey continues to serve as GRNSW’s Honorary Historian, collecting historical documents, photos, films and other memorabilia about the greyhound racing industry and displaying

BOARD MEMBERS REPORT

35

these at public venues such as Wentworth Park and certain regional museums around NSW.

Review of OperationsA review of the operations of GRNSW during the financial year is set out on pages 10 to 19 of this Annual Report and is to be read as forming part of this Board Members’ Report.

State of AffairsOn 1 July 2009, GRNSW assumed responsibility for the regulatory affairs of the sport following the disbanding of the Greyhound & Harness Racing Regulatory Authority. This resulted in GRNSW collecting fees relating to regulatory compliance as well as incurring all regulatory expenditure. Further information on these changes are referred to in the accounts or the notes thereto.

Subsequent EventsThere were no significant events after 30 June 2010 affecting the financial position of the entity.

Indemnification of Officers and AuditorsGRNSW has paid an insurance premium for Directors and Officers liability insurance for Members of the Board. GRNSW has not otherwise, during or since the financial year, indemnified or agreed to indemnify an Officer or auditor of itself or of any related body corporate against a liability incurred as such by an Officer or auditor.

Signed in accordance with a resolution of the Board Members.

On behalf of the Board Members

Joyce Alamango Greyhound Racing NSW – Board Member

Murray Nicol Greyhound Racing NSW – Board Member

Dated at Sydney this 28th day of September 2010

36

37

FINANCIAL STATEMENTSFor the Year Ended 30 June 2010

Greyhound Racing New South WalesABN 61 018 166 136

38

The 2009/10 Financial Statements of Greyhound Racing NSW and it’s reporting entities are the first to be impacted by the merger of the commercial entity (Greyhound Racing NSW until 30 June 2009) and the greyhound component of the Greyhound and Harness Racing Regulatory Authority (GHRRA). The merger took effect on 1 July 2009 on the direction of the Minister for Gaming and Racing with the merged entity retaining the name of Greyhound Racing NSW (GRNSW). The effect of the merger is that from 1 July 2009 GRNSW is responsible for the total operations of the NSW greyhound industry including all aspects of administration and regulation of the sport.

The changes to the administrative structure outlined above have resulted in a number of significant impacts to certain line items shown in the financials which follow. For ease of explanation, the items impacted have been marked with an asterix (*) in the financials where applicable. Detail on the differences in the figures reported in the 2009 accounts versus 2010, which are attributable to the merger, are explained below specific to the reporting entity.

1) Greyhound Racing NSw

The Administration Charge received from the Distribution account in 2009 was for the commercial entity of GRNSW only. The 2010 figure represents the combined amount which, under the former structure, would have been split between GRNSW and the GHRRA. After taking on the regulatory function at the time of the merger, GRNSW collected Licensing and Fees revenue for the first time.Commercial and Corporate expenditure in 2009 was almost the entire operating budget of the previous commercial GRNSW entity. The 2010 figure reflects the acquisition of additional corporate responsibilities from the merger.

Racing and Integrity expenditure relates to the core regulatory functions inherited by GRNSW at the time of the merger. Provision for Leave increased significantly with the transfer of former employees of the GHRRA as at 1 July 2009. All entitlements of staff moving from GHRRA to GRNSW were transferred to GRNSW.

2) Distribution Account

The Distribution to GRNSW is a combined figure in 2010. In 2009 expenditure for the same purpose (administration and regulation of the sport) was split between the line items Distribution to GRNSW and Distribution to GHRRA. Item 1.1 above also relates.Merger Expenses refers to the costs incurred to effect the merger. The 2010 figure primarily reflects the expenses borne by GRNSW with respect to transferring staff members (from GHRRA to GRNSW). This treatment was at the direction of the NSW Government. Costs involved in consolidating to one office location are also captured as Merger Expenses.

3) Greyhound Industry Development Fund (GIDF)

Net Transfer of Property, Plant and Equipment refers to the net amount of assets transferred to GRNSW as a result of the merger. The Board has reported this amount in the capital fund (GIDF) due to the assets being almost exclusively the greyhound share (53%) of the former GHRRA land and building at 22 Meredith Street Bankstown, plus the associated plant and equipment.

There were no material changes to the financial operation of the Greyhound Industry Advancement Fund (GIAF) or the Blue Paws Breeders and Owners Incentive Scheme as a result of the merger.

PREAMBLE TO THE FINANCIAL STATEMENTS

39

FINANCIAL STATEMENTSFor the Year Ended 30 June 2010

Greyhound Racing New South WalesABN 61 018 166 136

Financial ReportFor the Year Ended 30 June 2010

___________________________________________________________________________________________________________

CONTENTS PAGE

Auditor’s Independence Declaration 40

Statement of Comprehensive Income 41

Statement of Financial Position 42

Statement of Changes in Equity 43

Statement of Cash Flow 43

Notes to the Financial Statements 44 Declaration by Members of the Board 55

Independent Audit Report 56

___________________________________________________________________________________________________________

40

AUDITOR’S INDEPENDENCE DECLARATIONTO THE DIRECTORS OF GREYHOUND RACING NEW SOUTH WALES

___________________________________________________________________________________________________________

We hereby declare that to the best of our knowledge and belief, during the financial year ended 30 June 2010 there have been no:

(i) contraventions of auditor independence requirements in relation to the audit; and

(ii) contraventions of any applicable code of professional conduct in relation to the audit.

KS Black & CoChartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church Street,North Parramatta NSW 2151

Dated this 28th day of September 2010

41

STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $

REVENUE

Distribution Account – Administration charge* 1 (m) 4,739,380 1,459,000

Licensing and Fees* 794,022 -

Grants Amortisation of Deferred Income GIDF 2 228,424 145,342

Interest Received 2,368 2,669

Other Income 148,392 30,330

Profit on Sale of Non Current Assets (2,233) -

Sub-Total 5,910,352 1,637,341

Racing Information Services 566,908 561,953

TOTAL REVENUE 6,477,260 2,199,294

EXPENDITURE Commercial and Corporate* 2,683,777 1,530,882

Racing and Integrity* 3,216,688 -

Board Expenses 142,269 139,369

Other Expenses 36 1,795

Sub-Total 6,042,770 1,672,046

Racing Information Services 533,180 535,341

TOTAL EXPENDITURE 6,575,950 2,207,387

(Deficit)/Surplus 3 (98,690) (8,093)

* Please refer to the Preamble to the Financial Statements on page 38 for a detailed explanation of the consequences of the merger of Greyhound Racing NSW with the greyhound component of the former Greyhound and Harness Racing Regulatory Authority, which took effect on 1 July 2009.

The accompanying notes form part of these financial statements.

42

STATEMENT OF FINANCIAL POSITIONAS AT 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $

CURRENT ASSETS

Cash and cash equivalents 4 296,524 98,992

Receivables 5 746,679 172,551

Other current assets 6 35,661 18,364

TOTAL CURRENT ASSETS 1,078,864 289,907

NON-CURRENT ASSETS

Property, Plant & Equipment 7 357,429 647,495

TOTAL NON-CURRENT ASSETS 357,429 647,495

TOTAL ASSETS 1,436,293 937,402 CURRENT LIABILITIES

Trade & other Payables 8 571,101 178,583

Short-term provisions 9 587,384 94,486

TOTAL CURRENT LIABILITIES 1,158,485 273,069

NON-CURRENT LIABILITIES

Long-term payable 8 284,103 571,938

TOTAL NON-CURRENT LIABILITIES 284,103 571,938

TOTAL LIABILITIES 1,442,588 840,734

(DEFICIENCY IN)/NET ASSETS (6,295) 92,395 EQUITY

Reserves 11 66,406 66,406

Retained earnings (72,701) 25,989

TOTAL (DEFICIENCY IN)/EQUITY (6,295) 92,395

The accompanying notes form part of these financial statements.

43

STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $ Retained earnings as at 30 June 2009 25,989 34,082 (Deficit)/Surplus for the year (98,690) (8,093) Retained earnings as at 30 June 2010 (72,701) 25,989

Asset reserves as at 30 June 2009 66,406 66,848

Transfer to/(from) reserves - (442)

Asset reserves as at 30 June 2010 66,406 66,406

(6,295) 92,395

___________________________________________________________________________________________________________

STATEMENT OF CASH FLOWFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $ CASH FLOwS FROM OPERATING ACTIVITIES

Receipts from Distribution Account 4,739,380 1,459,000

Other inflows from Operations 1,496,960 178,341

Payments to Suppliers and Employees (6,038,808) (1,806,429)

Net cash provided by/(used in) operating activities 12 197,532 (169,088)

Net Increase/(Decrease) in cash and cash equivalents held 197,532 (169,088)

Cash and cash equivalents at 1 July 2009 98,992 268,080

Cash and cash equivalents at 30 June 2010 4 296,524 98,992___________________________________________________________________________________________________________

The accompanying notes form part of these financial statements.

44

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES

Greyhound Racing New South Wales (GRNSW) is a reporting entity.

Greyhound Racing New South Wales is an independent body corporate established under the Greyhound Racing Act 2009 to represent, fund and control the total operations of the greyhound racing industry in New South Wales. It commenced operations on 10 February 2003.

The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, including Accounting Interpretations and other pronouncements of the Australian Accounting Standards Board.

The financial report complies with all International Financial Reporting Standards (IFRS).

The following is a summary of the material accounting policies adopted by the economic entity in the preparation of the financial report. The accounting policies have been consistently applied unless otherwise stated.

Basis of Preparation

The accounting policies set out below have been consistently applied to all years presented.

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

(a) Property, Plant and Equipment

Each class of Property, Plant and Equipment is carried at cost, less, where applicable, any accumulated depreciation and impairment losses, where applicable.

Plant and Equipment

Plant and Equipment are carried at cost less accumulated depreciation and impairment losses.

The carrying amount of plant and equipment is reviewed annually by the Board to ensure it is not in excess of the recoverable amount from those assets. The recoverable amount is assessed on the basis of the accepted net cash flows which will be received from the assets employment and subsequent disposal. The expected net cash flows have not been discounted to present values in determining recoverable amounts.

Depreciation

Property, plant and equipment including capitalised lease assets are depreciated on a straight line basis over their useful lives to GRNSW, commencing from the time the asset is held ready for use. Fixed asset purchases of items below $1,000 are written off to expense in the year of acquisition.

45

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

The depreciation rates used for each class of depreciation assets are:

Class of Fixed Asset Depreciation Rate %_______________________________________Office Equipment 40_______________________________________Computer Equipment 40_______________________________________Furniture Fittings 15_______________________________________Motor Vehicles 22.5_______________________________________Leasehold Improvements 12.5_______________________________________

The asset’s residual values and useful lives are reviewed and adjusted if appropriate at each balance sheet date.

An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount.

Gains and losses on disposal are determined by comparing proceeds with the carrying amount. These gains or losses are included in the income statement. When revalued assets are sold, amounts included in the revaluation reserve relating to that asset are transferred to retained earnings.

(b) Leases

Leased assets are depreciated on a straight line basis over the term of their estimated useful lives where it is likely that Greyhound Racing New South Wales will obtain ownership of the asset over the term of the lease.

Lease payments for operating leases, where substantially all the risks and benefits remain with the lessor, are charged as an expense in the periods in which they are incurred.

Lease incentives for operating leases are recognised as a liability and amortised on a straight line basis over the life of the lease terms.

(c) Insurance

Insurance policies are held to cover all material risks. The insurance coverage is reviewed annually to ensure adequate cover for all risk areas.

(d) Financial Instruments

Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out below.

Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

46

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

Financial Liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

Impairment

At each reporting date, the entity assesses where there is objective evidence that a financial instrument has been impaired. Losses are recognised in the statement of comprehensive income.

(e) Employee Benefits

Provision is made for Greyhound Racing New South Wales’ liability for employee benefits arising from services rendered by employees to balance date. Employee benefits that are expected to be settled within one year have been measured at the amounts expected to be paid when the liability has been settled plus related on costs. Employee benefits payable later than one year have been measured at the present value of the estimated future cash outflows to be made for those benefits.

(f) Superannuation Commitments

Superannuation contributions made on behalf of employees are charged as expenses when incurred.

(g) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand and deposits held at call with banks.

(h) Revenue

Revenue from the distribution account and other activities is brought to account on an accruals basis based on the date of issue of the invoice by Greyhound Racing New South Wales.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

All revenue is recognised net of the amount of goods and services tax (GST).

(i) Receivables, Payables and Accruals

Accounts receivable generally settled within 30 days are carried at amounts due.

Accounts payable including accruals not yet billed, are recognised when GRNSW becomes obliged to make future payments as a result of a purchase of assets or services. Accounts payables are generally settled within 30 days.

(j) Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or part of an item of expense. Receivables and payables in the statement of financial position are shown inclusive of GST.

47

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(k) Distribution Account and Greyhound Industry Development Fund

By order of the Minister of Gaming and Racing, the balance of unexpected funds in the following accounts were transferred to Greyhound Racing New South Wales on 9 February 2003.

• GreyhoundRacingAuthority(NSW)DistributionAccount• GreyhoundRacingAuthority(NSW)GreyhoundIndustryDevelopmentFund

Both the above funds have been administered by Greyhound Racing New South Wales since 10 February 2003.

The Distribution Account receives TAB distributions to the greyhound code through NSW Racing Pty Ltd. Funds are used as follows:

• TopaymoniestotheGreyhoundIndustryDevelopmentFund.• TodistributefundstoGreyhoundRacingClubsinNewSouthWales.

The Greyhound Industry Development Fund (GIDF) makes payments to greyhound clubs predominantly for construction, maintenance work and other capital items.

(l) Greyhound Industry Advancement Fund and Blue Paws

Since the establishment of the Distribution Account and Greyhound Industry Development Fund by the Minister for Gaming and Racing on 9 February 2003, the following funds have been established from Board decisions of Greyhound Racing New South Wales:

• GreyhoundIndustryAdvancementFund• BluePawsBreeders&OwnersIncentiveScheme

The costs of administering the Distribution Account, the Greyhound Industry Development Fund, the Greyhound Industry Advancement Fund and Blue Paws Breeders & Owners Incentive Scheme are largely borne by Greyhound Racing New South Wales.

The Board has determined that these funds should not be incorporated in the accounts of Greyhound Racing New South Wales, and that separate financial statements should be prepared for each, thereby accounting and reporting to the industry for each of these separate funds.

(m) GHRRA Assets and Liabilities Transferred

By order of the Minister of Gaming and Racing, all greyhound related assets and liabilities of the Greyhound and Harness Racing Regulatory Authority (GHRRA) were transferred to Greyhound Racing New South Wales on 1 July 2009.

As a consequence the 2009/10 Financial Statements reflect a combination of the previous operations of Greyhound Racing NSW and the greyhound component of the GHRRA. The Administration Charge to the Distribution Account is one such item that has been affected in that in 2009/10 the total amount was paid to Greyhound Racing NSW, whereas in previous years the funds associated with regulatory activities were paid to the GHRRA. For further information see the Preamble to the Financial Statements on page 38.

48

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

2. GRANTS RECEIVED – GREYHOUND INDUSTRY DEVELOPMENT FUND

Greyhound Racing New South Wales has received grants from the Greyhound Industry Development Fund for the purchase of furniture, plant and equipment. The non current asset is capitalised at fair value at the time of acquisition. The grant received is recognised as a deferred liability and is amortised over the useful life of the asset, effectively offsetting the depreciation charged in respect of those assets. The amortised amount of the deferred income liability is recorded in the Statement of Comprehensive Income under Revenue.___________________________________________________________________________________________________________

2010 2009 $ $3. RESULTS FOR THE YEAR

Results for the year has been determined after :

Remuneration of Auditor - KS Black & Co 23,800 23,048 The above charges incorporate services and audit of the Distribution Account, the Greyhound Industry Development Fund, the Greyhound Industry Advancement Fund, and the Blue Paws Breeders & Owners Incentive Scheme. ___________________________________________________________________________________________________________ 4. CASH AND CASH EQUIVALENTS Cash at Bank 295,374 98,192

Cash on Hand 1,150 800 296,524 98,992___________________________________________________________________________________________________________ 5. RECEIVABLES Trade Debtors 746,679 172,551___________________________________________________________________________________________________________ 6. OTHER CURRENT ASSETS Prepayments 35,661 18,364

___________________________________________________________________________________________________________

49

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________ 2010 2009 $ $

7. PLANT & EQUIPMENT OFFICE EQUIPMENT & COMPUTERS At Cost 412,859 371,085Accumulated Depreciation (207,356) (93,617)

205,503 277,468FURNITURE & FITTINGS At Cost 50,017 60,797Accumulated Depreciation (18,589) (22,320)

31,428 38,477

MOTOR VEHICLES^ At Cost - 84,729Accumulated Depreciation - (35,838)

- 48,891

WEB DEVELOPMENT At cost 287,621 287,621Accumulated Depreciation (167,124) (80,837)

120,498 206,784

LEASEHOLD IMPROVEMENTS At Cost - 199,082Leasehold Amortisation - (123,207)

- 75,875

TOTAL PLANT & EQUIPMENT 357,429 647,495

^ All Motor Vehicles (Stewards fleet and GAP vehicle) are now reported in Greyhound Industry Development Fund accounts. ___________________________________________________________________________________________________________ 8. PAYABLES

CURRENT

Trade Creditors 494,769 101,119

Sundry Creditors and Accruals 26,449 27,581

Deferred Income 49,883 49,883

571,101 178,583

NON-CURRENT

Deferred Income 284,103 571,938

50

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $

9. PROVISIONS

CURRENT Provision for Annual Leave* 333,535 67,061

Provision for Long Service Leave* 242,264 27,425

Other 11,582 -

TOTAL CURRENT PROVISIONS 587,381 94,486

* For further information on leave provisions please see the Preamble to the Financial Statements on page 38.

___________________________________________________________________________________________________________ 10. CAPITAL & LEASING COMMITMENTS

Operating Lease Commitments

Rental of office premises Non cancellable operating lease commitments contracted for but not capitalised in the financial statements:

Property Lease Payable:

No later than one year 245,700 245,700

Later than one year but not later than five years 982,800 982,800

Later than five years 982,800 1,228,500

2,211,300 2,457,000

51

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

11. RESERVES

Asset Reserves

Greyhound Racing New South Wales was established under the Greyhound Racing Act 2009, and commenced operations on 10 February 2003.

As part of the process of establishing Greyhound Racing New South Wales, assets were transferred from the former Greyhounds Racing Authority to Greyhound Racing New South Wales. The Greyhound Industry Development Fund also purchases assets on behalf of Greyhound Racing New South Wales.

So as to account for those assets in Greyhound Racing New South Wales, the assets have been taken up at cost. The corresponding gains have been brought to account as income, and have been transferred to the assets reserve.

2010 2009 $ $

Fixed Asset Reserve:

Balance at beginning of financial year 2,945 2,503

Transfer in respect of depreciation - 442

Balance at end of financial year 2,945 2,945

Working Capital Reserve 63,461 63,461

TOTAL RESERVES AT 30 JUNE 2010 66,406 66,406

52

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $12. RECONCILIATION OF NET CASH PROVIDED BY OPERATING ACTIVITIES TO SURPLUS (Deficit)/Surplus (98,690) (8,093) Depreciation 228,424 145,782 Changes in assets and liabilities:

(Increase)/Decrease in Receivables (574,128) 58,000

(Increase)/Decrease in Other assets (17,297) 5,439

Increase/(Decrease) in Payables 166,325 (389,563)

Increase/(Decrease) in Provisions 492,898 19,347 Net Cash Provided by/(Used In) Operating Activities 197,532 (169,088)___________________________________________________________________________________________________________

13. FINANCIAL RISK MANAGEMENT

(a) General Objectives, Policies and ProcessesIn common with all businesses, the entity is exposed to risks that arise from its use of financial instruments. This note describes the entity’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the entity’s exposure to financial instrument risks, it’s objectives, policies and processes for managing those risk or the methods used to measure them from previous periods unless otherwise stated in this note.

The Board has overall responsibility for the determination of the entity’s risk management objectives and policies. The entity’s risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the company where such impacts may be material. The Board receives reports through which it reviews the effectiveness of the process put in place and appropriateness of the objectives and policies it sets.

The overall objective of the Board is to set policies that seek to reduce the risk as far as possible. Further details regarding these policies are set out below:

(b) Credit RiskCredit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the entity incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing to the entity. There is no concentration of credit risk with respect to receivables as the entity has government instrumentalities as its primary debtor. As a result, the credit quality of financial assets that are neither past due nor impaired is good.

The maximum exposure to credit risk at balance date is as follows:

2010 2009 $ $ Receivables 746,679 172,551

53

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

13. FINANCIAL RISK MANAGEMENT (cont’d)

(c) Liquidity RiskLiquidity risk is the risk that the entity may encounter difficulties raising funds to meet commitments associated with financial instruments that is creditors. It is the policy of the Board that the entity maintains adequate funds.

Maturity Analysis

2010 Carrying Contractual Amount Cash Flows < 6 Months $ $ $ Financial Liabilities Non-derivatives Current Payables 521,218 521,218 521,218 2009 Carrying Contractual Amount Cash Flows < 6 Months $ $ $ Financial Liabilities Non-derivatives Current Payables 128,700 128,700 128,700

(d) Market RiskMarket risk arises from the use of interest bearing financial instruments. It is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in interest rates (interest rate risk).

54

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30TH JUNE 2010

___________________________________________________________________________________________________________

13. FINANCIAL RISK MANAGEMENT (cont’d)

(e) Interest Rate RiskThe entity is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk.

Sensitivity AnalysisThe following tables demonstrate the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, of the entity’s results (through the impact on adjusted interest rate).

2010 Carrying +1% Interest - 1% Interest Amount Rate Rate $ $ $ Cash & Cash Equivalents 296,524 2,965 (2,965) The above analysis assumes all other variables remain constant.

2009 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & Cash Equivalents 98,992 990 (990)

55

DECLARATION BY MEMBERS OF THE BOARD

___________________________________________________________________________________________________________

The Board of Greyhound Racing New South Wales declares that:

The financial statements and notes as set out on pages 41 to 54 present fairly the financial position of Greyhound Racing New South Wales as at 30 June 2010 and its performance for the year ended on that date in accordance with Accounting Standards (including Australian Accounting Interpretations).

In the Board’s opinion, there are reasonable grounds to believe that the entity will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Greyhound Racing New South Wales.

Dated this 28th day of September 2010

Gabriel (Bill) MangafasGreyhound Racing New South Wales – Board Member

Tom GreenGreyhound Racing New South Wales – Board Member

56

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

___________________________________________________________________________________________________________

Report on the Financial Report

We have audited the accompanying financial report of Greyhound Racing New South Wales, which comprises of the statement of financial position as at 30 June 2010, and the statement of comprehensive income, statement of changes in equity and statement of cash flow for the year ended on that date, a summary of significant accounting policies and other explanatory notes and the declaration by members of the Board as set out on pages 41 to 55.

Responsibility for the Financial Statements

The Board of Greyhound Racing New South Wales are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including Australian Accounting Interpretations) and the financial reporting requirements of the entity’s constitution. This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

An audit involved performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Australian professional ethical pronouncements.

57

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

___________________________________________________________________________________________________________

Auditor’s Opinion

In our opinion the financial report of Greyhound Racing New South Wales is in accordance with the entity’s constitution and

(i) gives a true and fair view of the entity’s financial position as at 30 June 2010 and of its performance for the year ended on that date; and

(ii) complies with Australian Accounting Standards (including Australian Accounting Interpretations) and the entity’s constitution.

KS Black & CoChartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church StreetNorth Parramatta NSW 2151

Dated this 28th day of September 2010

58

59

FINANCIAL STATEMENTSFor the Year Ended 30 June 2010

Greyhound Racing New South WalesDistribution Account

ABN 57 509 057 082

Financial StatementsFor the Year Ended 30 June 2010

___________________________________________________________________________________________________________

CONTENTS PAGE

Auditor’s Independence Declaration 60

Statement of Comprehensive Income 61

Statement of Financial Position 62

Statement of Changes in Equity 62

Statement of Cash Flow 63

Notes to the Financial Statements 64

Declaration by Members of the Board 71

Independent Audit Report 72

___________________________________________________________________________________________________________

60

AUDITOR’S INDEPENDENCE DECLARATIONTO THE DIRECTORS OF GREYHOUND RACING NEW SOUTH WALES

___________________________________________________________________________________________________________

We hereby declare that to the best of our knowledge and belief, during the financial year ended 30 June 2010 there have been no:

(i) contraventions of auditor independence requirements in relation to the audit; and

(ii) contraventions of any applicable code of professional conduct in relation to the audit.

KS Black & CoChartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church StreetNorth Parramatta NSW 2151

Dated this 28th day of September 2010

61

STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $REVENUE Product Fee 2(a) 24,739,284 24,251,027

Wagering Incentive Fee 2(b) 5,556,833 5,462,228

Interest Received 252,787 232,140

Overpayment to GHRRA 3 - 35,436

Racefield Information Use Fees 9 4,508,916 6,790,233

Other 36,300 - TOTAL REVENUE 35,094,120 36,771,064 EXPENDITURE Distribution to Greyhound Racing New South Wales* 4,739,380 1,459,000

Distribution to GHRRA (NSW)* 3 - 3,087,743

Distribution to Greyhound Industry Development Fund 2,750,000 2,750,000

Distribution to Greyhound Industry Advancement Fund 700,000 550,000

Racefield / Wagering Expenses 9 196,779 3,810,495

Distributions to Clubs 5 24,783,984 21,513,472

Rebate of On-Course Tote Commissions to Clubs 11 1,219,709 1,322,578

Club Incentive Scheme 1,305,022 1,027,528

Sundry Expenses 8,195 27,450

Merger Expenses* 618,240 330,015 TOTAL EXPENDITURE 36,321,309 35,878,280 (DEFICIT)/SURPLUS FOR THE YEAR (1,227,189) 892,784

* Please refer to the Preamble to the Financial Statements on page 38 for a detailed explanation of the consequences of the merger of Greyhound Racing NSW with the greyhound component of the former Greyhound and Harness Racing Regulatory Authority, which took effect on 1 July 2009.

The accompanying notes form part of these financial statements.

62

STATEMENT OF FINANCIAL POSITIONAS AT 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CURRENT ASSETS Cash and cash equivalents 6 6,204,366 5,963,157Receivables 7 8,612,721 9,822,555 TOTAL CURRENT ASSETS 14,817,087 15,785,712 CURRENT LIABILITIES Accounts Payable 8 14,643,006 14,123,427 TOTAL CURRENT LIABILITIES 14,643,006 14,123,427 NET ASSETS 174,081 1,662,285 EQUITY Retained Earnings 174,081 1,662,285 TOTAL EQUITY 174,081 1,662,285

___________________________________________________________________________________________________________

STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $RETAINED EARNINGS Retained Earnings at 30 June 2009 1,401,270 508,486Surplus/(Deficit) Attributable to the Fund (1,227,189) 892,784 Retained Earnings at 30 June 2010 174,081 1,401,270

The accompanying notes form part of these financial statements.

63

STATEMENT OF CASH FLOWFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $

CASH FLOwS FROM OPERATING ACTIVITIES Inflows Cash Receipts from Operations 38,325,466 36,538,924Interest Received 252,787 232,140 TOTAL RECEIPTS 38,578,253 36,771,064 Cash Payments from Operations Payments to Greyhound Industry Development Fund 2,750,000 2,750,000Payments to Greyhound Industry Advancement Fund 700,000 550,000Payments on behalf of Race Clubs 27,262,382 24,628,592Distribution to Greyhound Racing New South Wales 4,739,380 1,459,000Distribution to GHRRA (NSW) 3 - 1,922,000Payments to other suppliers 2,885,282 481,288 TOTAL PAYMENTS 38,337,044 31,790,880 Net Cash from (Used In) Operating Activities 12 241,209 4,980,234 Net Increase/(Decrease) in Cash and Cash Equivalents Held 241,209 4,980,234 Cash and Cash Equivalents at 1 July 2009 5,963,157 982,923 Cash and Cash Equivalents at 30 June 2010 6 6,204,366 5,963,157

The accompanying notes form part of these financial statements.

64

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES

Greyhound Racing New South Wales is an independent body corporate established under the Greyhound Racing Act 2009 and under Section 9(2)(c) of that Act, has as one of its functions, the distributions of money received as a result of commercial arrangements required by the Totalisator Act 1997 (Distribution Function). The Greyhound Racing New South Wales Distribution Account is a fund maintained for the purposes of the Distribution Function.

Greyhound Racing New South Wales Distribution Account is a reporting entity.

The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, including Accounting Interpretations and other pronouncements of the Australian Accounting Standards Board.

The financial report is for the entity Greyhound Racing New South Wales Distribution Account as an individual entity.

The financial report complies with all International Financial Reporting Standards (IFRS).

The following is a summary of the material accounting policies adopted by the entity in the preparation of the financial report. The accounting policies have been consistently applied unless otherwise stated.

Basis of Preparation

The accounting policies set out below have been consistently applied to all years presented.

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

(a) Insurance

The Greyhound Racing New South Wales Distribution Account has no assets which require insurance cover. The insurance cover of any asset used by the Greyhound Racing New South Wales Distribution Account is the responsibility of Greyhound Racing New South Wales.

(b) Administration Costs

The cost associated with the administration of the Greyhound Racing New South Wales Distribution Account are borne by Greyhound Racing New South Wales. Employees of that body carry out the administrative function.

(c) Income

The Distribution Account receives its main source of income from the TAB by way of appropriations from its activities, known as product fees and a wagering incentive fee, as well as racefield information use fees from wagering operators.

These appropriations are supplemented from other sources such as interest in respect of bank accounts.

Funds are held in a separate bank account of Greyhound Racing New South Wales titled the Greyhound Racing New South Wales Distribution Account.

65

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(d) Cash and Cash Equivalents Cash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid investments with

original maturities of three months or less.

(e) Receivables

Accounts receivable generally settled within 30 days are carried out at amounts due.

(f) Accounts Payable

Accounts payable are recognised as amounts to be paid in the future to Greyhound Racing Clubs in NSW from the Distribution Account. Accounts payable are generally settled within 30 days.

(g) Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition

of the asset or part of an item of expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST.

(j) Financial Instruments

Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out below.

Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

Financial Liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

At each reporting date, the entity assesses where there is objective evidence that a financial instrument has been impaired.

(k) Revenue

Revenue from the TAB and other activities is brought to account on an accruals basis based on the period of time to which the payment relates in accordance with invoices issued by TAB, RacingCorp and others.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

All revenue is recognised net of the amount of goods and services tax (GST).

66

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2. TAB PAYMENTS

Payments received from TAB Limited to 30 June 2010 include the following components:• ProductFee• WageringIncentiveFee

(a) Product Fee

Product Fees are payable by TAB under the Racing Distribution Agreement date 11 December 1997, as amended.

The Product Fee in respect of each financial year will be paid by TAB as follows:

(i) Within 3 business days of each race, 33% of the Product Fee payable on the On-Course Race Receipts and Off-Course Race Receipts from that race. The Product Fee for this activity has been accrued as at 30 June 2010.

(ii) Within 3 business days of the end of a quarter the estimated balance of the Product Fee calculated based on TAB’s management accounts payable on the Net Wagering Revenue (whether actual or accrued) received during that quarter.

(b) wagering Incentive Fee

The Wagering Incentive Fee is calculated in accordance with the Racing Distribution Agreement.

An amount equal to 100% of the estimated Wagering Incentive Fee payable by the TAB will be due on 31 December and 30 June in each financial year. Payment by the TAB is to be made within 20 business days after 31 December and 30 June in each

financial year.___________________________________________________________________________________________________________

3. DISTRIBUTION TO GHRRA (NSw)

The amount shown for the 2009 year as distribution to GHRRA (NSW) is the amount paid to GHRRA (NSW) during the year ended 30 June 2009 in accordance with their budget as approved by the Minister for Gaming & Racing. The GHRRA (NSW) was disbanded on 30 June 2009 and it’s greyhound related functions were transferred to Greyhound Racing NSW.

In the 2009 year the Distribution to the GHRRA (NSW) comprised of $1,922,000 paid directly to the GHRRA (NSW) and $1,165,743 which was paid to race clubs for on-payment to the GHRRA (NSW), reflecting the cost of stewarding services.

In the 2008 year, GHRRA (NSW) actual expenditure was less than budgeted expenditure by $35,436. This amount was returned to the Distribution Account in the 2009 financial year.___________________________________________________________________________________________________________

4. DISTRIBUTION ACCOUNT POLICY/PAYMENTS

Payments under the scheme of the distribution are made in accordance with a policy which is reviewed annually and set prior to the commencement of each financial year.___________________________________________________________________________________________________________

5. DISTRIBUTIONS TO CLUBS

The amounts shown reflect payments to clubs to fund prizemoney and administration. The increase in 2010 is due to the prizemoney increases implemented by the Board during the Financial Year.

67

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $6. CASH AND CASH EQUIVALENTS Cash at bank 824,806 400,820Short term deposits – Treasury Corp 5,379,560 5,562,337 6,204,366 5,963,157___________________________________________________________________________________________________________

7. RECEIVABLES CURRENT Product Fee and Wagering Incentive Fee 6,846,858 7,234,326Bank Guarantee - Rhodes 377,674 377,674Other 1,388,189 2,210,555 8,612,721 9,822,555 ___________________________________________________________________________________________________________

8. ACCOUNTS PAYABLE CURRENT Distribution to Greyhound Industry Development Fund 1,500,000 2,768,775Distribution to Greyhound Industry Advancement Fund 233,336 236,712On Course Commission Rebate/Distribution to Clubs 3,430,237 4,646,984Racefield / Wagering Expenses 9 - 3,690,445Greyhound Racing New South Wales 607,134 93,162Australian Taxation Office (includes GST) 440,522 559,752Deferred Revenue 10 8,392,315 1,862,110Other 39,462 265,487 14,643,006 14,123,427___________________________________________________________________________________________________________

9. RACEFIELD / wAGERING EXPENSES

The 2009 balance includes the settlement of a dispute with TAB Ltd with respect to the Racing Distribution Agreement and the payment of Racefield Information Use Fees.___________________________________________________________________________________________________________

10. DEFERRED REVENUE

The balance in 2009 was determined by the Board to be held pursuant to the settlement of a dispute with Tabcorp Holdings with respect to the Racing Distribution Agreement and the payment of Racefield Information Use Fees.

The balance in 2010 represents the 2009 amount plus Racefield Information Use Fees received from Tabcorp Holdings and TAB Ltd in 2010.

68

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

11. CLUB INCENTIVE SCHEME

The Board resolved to decrease the On-Course Tote Commission paid to clubs for TAB turnover generated on-course to 5% of turnover (from an average of 7.4%) from the commencement of the 2008/09 financial year. The Club Incentive Scheme was introduced to direct funds (previously paid in On-Course Tote Commissions) to clubs that exceeded the benchmark with respect to prizemoney paid. ___________________________________________________________________________________________________________

12. RECONCILIATION OF NET CASH PROVIDED BY /(USED IN) OPERATING ACTIVITIES wITH LOSS/(SURPLUS) 2010 2009 $ $ (Loss)/Surplus (1,227,189) 892,784Changes in Assets and Liabilities: (Increase)/Decrease in Receivables 3,778,601 (2,664,366)Increase/(Decrease) in Payables (2,301,203) 6,751,816 Net Cash Provided by/(Used in) Operating Activities 241,209 4,980,234 ___________________________________________________________________________________________________________

13. FINANCIAL RISK MANAGEMENT

(a) General Objectives, Policies and ProcessesIn common with all businesses, the entity is exposed to risks that arise from its use of financial instruments. This note describes the entity’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the entity’s exposure to financial instrument risks, it’s objectives, policies and processes for managing those risk or the methods used to measure them from previous periods unless otherwise stated in this note.

The Board has overall responsibility for the determination of the entity’s risk management objectives and policies. The entity’s risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the company where such impacts may be material. The Board receives reports through which it reviews the effectiveness of the process put in place and appropriateness of the objectives and policies it sets.

The overall objective of the Board is to set policies that seek to reduce the risk as far as possible. Further details regarding these policies are set out below:

69

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

13. FINANCIAL RISK MANAGEMENT (continued)

(b) Credit RiskCredit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the entity incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing to the entity. There is no concentration of credit risk with respect to receivables as the entity has government instrumentalities as its primary debtor. As a result, the credit quality of financial assets that are neither past due nor impaired is good.

The maximum exposure to credit risk at balance date is as follows:

2010 2009 $ $ Receivables 8,612,721 9,822,555

(c) Liquidity RiskLiquidity risk is the risk that the entity may encounter difficulties raising funds to meet commitments associated with financial instruments that is creditors. It is the policy of the Board of Directors that the entity maintains adequate funds.

Maturity Analysis

2010 Carrying Contractual Amount Cash Flows < 6 Months $ $ $ Financial Liabilities Non-derivatives Current Payables 14,643,006 14,643,006 14,643,006 2009 Carrying Contractual Amount Cash Flows < 6 Months $ $ $ Financial Liabilities Non-derivatives Current Payables 14,123,427 14,123,427 14,123,427

(d) Market Risk Market risk arises from the use of interest bearing financial instruments. It is the risk that the fair value or future cash flows

of a financial instrument will fluctuate because of changes in interest rates (interest rate risk).

(e) Interest Rate Risk The entity is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk.

70

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

13. FINANCIAL RISK MANAGEMENT (continued)

Sensitivity Analysis The following tables demonstrate the sensitivity to a reasonably possible change in interest rates, with all other variables held

constant, of the entity’s results (through the impact on adjusted interest rate).

2010 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & Cash Equivalents 6,204,366 62,044 (62,044) The above analysis assumes all other variables remain constant

2009 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & Cash Equivalents 5,963,157 59,632 (59,632)

71

DECLARATION BY MEMBERS OF THE BOARD

___________________________________________________________________________________________________________

The Board of Greyhound Racing New South Wales declares that:

The financial statements and notes as set out on pages 61 to 70 present fairly the financial position of Greyhound Racing New South Wales Distribution Account as at 30 June 2010 and its performance for the year ended on that date in accordance with Accounting Standards (including Australian Accounting Interpretations).

In the Board’s opinion, there are reasonable grounds to believe that the entity will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Greyhound Racing New South Wales.

Dated this 28th day of September 2010

Gabriel (Bill) MangafasGreyhound Racing New South Wales – Board Member

Tom GreenGreyhound Racing New South Wales – Board Member

72

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

DISTRIBUTION ACCOUNT___________________________________________________________________________________________________________

Report on the Financial Report

We have audited the accompanying financial report of Greyhound Racing New South Wales Distribution Account, which comprises of the statement of financial position as at 30 June 2010, the statement of comprehensive income, statement of changes in equity and statement of cash flow for the year ended on that date, a summary of significant accounting policies and other explanatory notes and the declaration by members of the Board as set out on pages 61 to 71.

Responsibility for the Financial Statements

The Board of Greyhound Racing New South Wales are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including Australian Accounting Interpretations). This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Australian professional ethical pronouncements.

73

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

DISTRIBUTION ACCOUNT (cont’d)___________________________________________________________________________________________________________

Auditor’s Opinion

In our opinion the financial report of Greyhound Racing New South Wales Distribution Account:

(i) gives a true and fair view of the financial position of the Fund as at 30 June 2010 and of its performance for the year ended on that date; and

(ii) complies with Australian Accounting Standards (including Australian Accounting Interpretations).

KS Black & Co

Chartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church Street, North Parramatta NSW 2151

Dated this 28th day of September 2010

74

75

FINANCIAL STATEMENTSFor the Year Ended 30 June 2010

Greyhound Racing New South WalesGreyhound Industry Development Fund

ABN 49 238 669 768

Financial ReportFor the Year Ended 30 June 2010

___________________________________________________________________________________________________________

CONTENTS PAGE

Auditor’s Independence Declaration 76

Statement of Comprehensive Income 77

Statement of Financial Position 78

Statement of Changes in Equity 78

Statement of Cash Flow 79

Notes to the Financial Statements 80

Declaration by Members of the Board 87

Independent Audit Report 88

___________________________________________________________________________________________________________

76

AUDITOR’S INDEPENDENCE DECLARATIONTO THE DIRECTORS OF GREYHOUND RACING NEW SOUTH WALES

GREYHOUND INDUSTRY DEVELOPMENT FUND___________________________________________________________________________________________________________

We hereby declare that to the best of our knowledge and belief, during the financial year ended 30 June 2010 there have been no:

(i) contraventions of auditor independence requirements in relation to the audit; and

(ii) contraventions of any applicable code of professional conduct in relation to the audit.

KS Black & Co Chartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church Street North Parramatta NSW 2151

Dated this 28th day of September 2010

77

STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________ 2010 2009 Note $ $REVENUE TAB Distribution 1 (c) 2,750,000 2,750,000Interest Received 1 (c) 85,864 50,714Profit on Disposal of Plant and Equipment 1 (c) 210,379 22Net Transfer of Property, Plant & Equipment from GHRRA* 1,821,535 - TOTAL REVENUE 4,867,778 2,800,736 EXPENDITURE Depreciation 141,115 -Grants 1,363,189 1,482,634Interest Free Interminable Loans 5 607,938 1,165,570Interest 103 100Other 363 725 TOTAL EXPENDITURE 2,112,708 2,649,029 SURPLUS FOR THE YEAR 2,755,070 151,707

* Please refer to the Preamble to the Financial Statements on page 38 for a detailed explanation of the consequences of the merger of Greyhound Racing NSW with the greyhound component of the former Greyhound and Harness Racing Regulatory Authority, which took effect on 1 July 2009.

The accompanying notes form part of these financial statements.

78

STATEMENT OF FINANCIAL POSITIONAS AT 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CURRENT ASSETS Cash and cash equivalents 2 1,459,895 232,269Receivables 3 1,541,985 2,776,057 TOTAL CURRENT ASSETS 3,001,880 3,008,326 NON-CURRENT ASSETS Receivables 3 7,847,681 7,097,681Property, Plant and Equipment* 9 1,890,799 - TOTAL NON-CURRENT ASSETS 9,738,480 7,097,681 TOTAL ASSETS 12,740,360 10,106,007 CURRENT LIABILITIES Provision for Approved Expenditure 1 (g) 375,016 536,199Payables 4 263,771 223,305 TOTAL CURRENT LIABILITIES 638,787 759,504 TOTAL LIABILITIES 638,787 759,504 NET ASSETS 12,101,573 9,346,503 Retained Earnings 12,101,573 9,346,503 TOTAL EQUITY 12,101,573 9,346,506___________________________________________________________________________________________________________

STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $ Retained earnings at 30 June 2009 9,346,503 9,194,796Surplus for the year 2,755,070 151,707 Retained earnings as at 30 June 2010 12,101,573 9,346,503

The accompanying notes form part of these financial statements.

79

STATEMENT OF CASH FLOWFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CASH FLOwS FROM OPERATING ACTIVITIES Cash Inflows from Operations: Interest Received 85,864 50,714Other - 22Receipts from Distribution Account 2,750,000 2,750,000 2,835,864 2,800,736 Cash Outflows from Operations Payments to Race Clubs – Grants and IFIL’s 1,608,238 5,823,084 Net Cash Flows provided by/(used in) Operating Activities 7 1,227,626 (3,022,348) Net Increase/(Decrease) in Cash and Cash Equivalents Held 1,227,626 (3,022,348) Cash and Cash Equivalents at 1 July 2009 232,269 3,254,617 Cash and Cash Equivalents at 30 June 2010 2 1,459,895 232,269

The accompanying notes form part of these financial statements.

80

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES

Greyhound Racing New South Wales is an independent body corporate established under the Greyhound Racing Act 2009 and under Section 9(2)(c) of that Act, has as one of its functions, distribution of money received as a result of commercial arrangements required by the Totalisator Act 1997 (Distribution Function). The Greyhound Racing New South Wales Greyhound Industry Development Fund (GIDF) is a fund maintained for the purposes of the Distribution Function.

Since the inception of Greyhound Racing New South Wales on 9 February 2003, Greyhound Racing New South Wales distributes funds to the GIDF in accordance with its powers under the Greyhound Racing Act 2002.

The GIDF provides funding for projects involving backlog maintenance or new capital investment at greyhound racing tracks in NSW. Projects are assessed for funding eligibility according to the following objectives:

1. Statutory compliance;2. Operational reliability;3. Racecourse image;4. Operational Efficiency; and5. Other asset improvements.

A full copy of the GIDF Policy is available at GRNSW’s website, www.thedogs.com.au

The Greyhound Racing New South Wales Greyhound Industry Development Fund (GIDF) is a reporting entity. The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, including Accounting Interpretations and other pronouncements of the Australia Accounting Standards Board.

The financial report of Greyhound Racing New South Wales Greyhound Industry Development Fund (GIDF) complies with all International Financial Reporting Standards (IFRS). The following is a summary of the material accounting policies adopted by the entity in the preparation of the financial report. The accounting policies have been consistently applied unless otherwise stated.

Basis of Preparation

The accounting policies set out below have been consistently applied to all years presented.

The financial report has been prepared on an accruals basis and is based on historical costs modified by the revaluation of selected non-current assets, financial assets and financial liabilities for which the fair value basis of accounting has been applied.

(a) Insurance

The Greyhound Racing New South Wales GIDF Account has assets which require insurance cover. The insurance cover of any asset used by the Greyhound Racing New South Wales GIDF is the responsibility of Greyhound Racing New South Wales.

(b) Administration Costs

The costs associated with the administration of the Greyhound Racing New South Wales GIDF are borne by Greyhound Racing New South Wales then charged back to the GIDF.

This sees the employees of Greyhound Racing New South Wales carrying out the administrative functions with the costs ultimately met by the GIDF.

81

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(c) Revenue

The GIDF receives its main source of income from the Greyhound Racing New South Wales Distribution Account by way of appropriations from the Distribution Account. These appropriations are supplemented from other sources such as interest in respect of bank account interest.

Funds are held in a separate bank account of Greyhound Racing New South Wales titled Greyhound Racing New South Wales GIDF. Revenue from the distribution account and other activities is brought to account on an accruals basis based on the date of issue of the invoice by Greyhound Racing New South Wales. Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

All revenue is recognised net of the amount of goods and services tax (GST).

(d) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less.

(e) Receivables, Payables & Accruals Accounts receivable generally settled within 30 days are carried at amounts due.

Accounts Payable including accruals not yet billed, are recognised when Greyhound Racing New South Wales becomes obliged to make future payments as a result of a purchase of assets or services. Accounts Payables are generally settled within 30 days.

(f) Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or part of an item of expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST.

(g) Provision for Approved Expenditure

The provision for approved expenditure is recognised as amounts to be paid in the future for approved projects.

The terms and conditions of payment of such expenditure is contained within the approval of each project. If no terms are specified, payment is made by the end of the month following the month in which the invoice is received from the club to which the project approval has been provided.

82

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(h) Financial Instruments

Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out below.

Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

Financial Liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

___________________________________________________________________________________________________________

2010 2009 $ $ 2. CASH AND CASH EQUIVALENTS Cash at Bank 73,556 79,094Short term deposits 1,386,339 153,175 1,459,895 232,269___________________________________________________________________________________________________________ 3. RECEIVABLES CURRENT Greyhound Racing New South Wales Distribution Account 1,500,000 2,768,775Other 41,985 7,282 1,541,985 2,776,057 NON-CURRENT Loans Repayable Clubs - Wentworth Park Sporting Complex Trust 6,497,681 6,497,681- NCA – “The Gardens” 1,350,000 600,000 7,847,681 7,097,681

83

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

3. RECEIVABLES (cont’d)

The loan to Wentworth Park Sporting Complex Trust was for construction of a grandstand over the period 1984-1987 by the former Racecourse Development Fund. The loan was transferred to the Greyhound Industry Development Fund in June 1998 by the Minister for Gaming and Racing.

The Wentworth Park Sporting Complex Trust shows the amount in their audited financial statements as a non current, non interest bearing liability. In those financial statements however, they state that they consider the loan to be non refundable. The Board of Greyhound Racing New South Wales considers that the monies were appropriately loaned and are recoverable.

GRNSW has entered into an agreement with the NSW National Coursing Association to advance them monies to support their development of “The Gardens” complex. As at balance date, this totals $1,350,000.

All loans are secured by a mortgage over “The Gardens” property.___________________________________________________________________________________________________________

2010 2009 $ $4. PAYABLES CURRENT – Trade Payables & Accruals 263,771 223,305

___________________________________________________________________________________________________________

5. INTEREST FREE INTERMINABLE LOANS

The major items funded by Interest Free Interminable Loans in 2009/10 were:Potts Park kennel refurbishment (convert to single tier)•Upgrade of Grafton electrical supply•Replacement of Dubbo running rail•Viewing area upgrade and installation of transition turn at Maitland•Relocate catching pen and 400m start at The Gardens•

Full details on monies distributed to clubs through the GIDF can be found in the table on page 23.___________________________________________________________________________________________________________

6. FUTURE COMMITMENTS

a) Rental of Photo Finish Equipment

Greyhound Racing New South Wales entered into a contract for the rental of photo finish equipment for greyhound racing tracks in New South Wales in November 2005. Commitments contracted for but not capitalised in the financial statements are as follows:-

2010 2009 $ $ Payable: No Later than one year 262,218 262,218Later than one year but no later than five years 87,406 349,624 349,624 611,842

84

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

6. FUTURE COMMITMENTS (cont’d)

b) Maintenance of Signs & Cameras

Greyhound Racing New South Wales has entered into contracts for the maintenance of signs and surveillance cameras located at certain race clubs.

Amounts payable under those contracts are:

2010 2009 $ $ No later than one year 12,204 12,204Later than one year but not later than five years - 12,204 12,204 24,408___________________________________________________________________________________________________________

7. RECONCILIATION OF NET CASH USED IN OPERATING ACTIVITIES TO LOSS Surplus 2,755,070 151,707 Depreciation 141,113 -

Profit on disposal of plant and equipment (210,379) -

Net Transfer of Property, Plant & Equipment from GHRRA (1,821,535) -

Changes in assets and liabilities:

(Increase)/Decrease in Receivables 484,072 (757,215)

Increase/(Decrease) in Provisions (161,183) (2,297,267)

Increase/(Decrease) in Payables 40,468 (119,573) Net cash provided by/(used in) operating activities 1,227,626 (3,022,348)___________________________________________________________________________________________________________

8. FINANCIAL RISK MANAGEMENT

a) General objectives, policies and processes In common with all businesses, the entity is exposed to risks that arise from its use of financial instruments. This note describes the

entity’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the entity’s exposure to financial instrument risks, it’s objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

The Board has overall responsibility for the determination of the entity’s risk management objectives and policies. The entity’s risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the entity where such impacts may be material. The Board receives reports through which it reviews the effectiveness of the process put in place and the appropriateness of the objectives and policies it sets.

The overall objective of the Board is to set policies that seek to reduce the risk as far as possible. Further details regarding these policies are set out below:

85

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

8. FINANCIAL RISK MANAGEMENT (cont’d)

b) Credit riskCredit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the entity incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing the entity. There is no concentration of credit risk with respect to current receivables as the entity has government instrumentalities as its primary debtor. However, loans to clubs are indeterminable though repayable.

The maximum exposure to credit risk at balance date is as follows:

2010 2009 $ $ Non-Current Receivables 7,847,681 7,097,681

c) Liquidity riskLiquidity is the risk that the entity may encounter difficulties raising funds to meet commitments associated with financial instruments that is creditors. It is the policy of the Board that the entity maintains adequate funds.

Maturity Analysis Carrying Contractual Amount Cash Flows < 6 months2010 $ $ Financial Liabilities Non-derivatives Current payables 263,771 263,771 263,771 2009 Carrying Contractual Amount Cash Flows < 6 months $ $ $ Financial Liabilities Non-derivatives Current payables 223,305 223,305 223,305

d) Market riskMarket risk arises from the use of interest bearing financial instruments. It is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in interest rates (interest rate risk).

(i) Interest rate riskThe entity is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk.

86

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

8. FINANCIAL RISK MANAGEMENT (cont’d)

d) Market risk (cont’d)

Sensitivity analysisThe following tables demonstrate the sensitivity to a reasonably possible change in interest rates, with all other variables held constant, of the entity’s results (through the impact on adjusted interest rate).

2010 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & cash equivalents 1,459,895 14,599 (14,599)

The above analysis assumes all other variables remain constant.

2009 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & cash equivalents 232,269 2,322 (2,322)

___________________________________________________________________________________________________________

9. PROPERTY, PLANT AND EQUIPMENT 2010 2009 $ $ Land at cost (Bankstown property) 619,988 - Building at cost (Bankstown property) 885,017 -Less: Accumulated Depreciation (91,706) - 793,311 - Plant, Equipment and Furniture 270,254 -Less: Accumulated Depreciation (118,530) - 151,724 - Motor Vehicles at Cost^ 366,026 -Less: Accumulated Depreciation (40,250) - 325,776 - 1,890,799 -

^ All Motor Vehicles (Stewards fleet and GAP vehicle) are now reported in Greyhound Industry Development Fund accounts. Previously the GAP vehicle had been shown in Greyhound Racing NSW accounts.

87

DECLARATION BY MEMBERS OF THE BOARD

___________________________________________________________________________________________________________

The Board of Greyhound Racing New South Wales declares that:

The financial statements and notes as set out on pages 77 to 86 present fairly the financial position of Greyhound Racing New South Wales Greyhound Industry Development Fund as at 30 June 2010 and its performance for the year ended on that date in accordance with Accounting Standards (including Australian Accounting Interpretations).

In the Board’s opinion, there are reasonable grounds to believe that the entity will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Greyhound Racing New South Wales.

Dated this 28th day of September 2010

Gabriel (Bill) MangafasGreyhound Racing New South Wales – Board Member

Tom GreenGreyhound Racing New South Wales – Board Member

88

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES GREYHOUND INDUSTRY DEVELOPMENT FUND

___________________________________________________________________________________________________________

Report on the Financial Report

We have audited the accompanying financial report of Greyhound Racing New South Wales Greyhound Industry Development Fund, which comprises of the statement of financial position as at 30 June 2010, the statement of comprehensive income, statement of changes in equity and statement of cash flow for the year ended on that date. A summary of significant accounting policies and other explanatory notes and the declaration by members of the Board as set out on pages 77 to 87.

Responsibility for the Financial Statements

The Board of Greyhound Racing New South Wales Greyhound Industry Development Fund are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including Australian Accounting Interpretations). This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Australian professional ethical pronouncements.

89

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

GREYHOUND INDUSTRY DEVELOPMENT FUND (cont’d)___________________________________________________________________________________________________________

Auditor’s Opinion

In our opinion the financial report of Greyhound Industry Development Fund:

(i) gives a true and fair view of the financial position of the Fund as at 30 June 2010 and of its performance for the year ended on that date; and

(ii) complies with Australian Accounting Standards (including Australian Accounting Interpretations).

KS Black & CoChartered Accountants

Stuart H. Cameron

Level 1, 460 Church Street, North Parramatta NSW 2151

Dated this 28th day of September 2010

90

91

FINANCIAL STATEMENTSFor the Year Ended 30 June 2010

Greyhound Racing New South Wales Greyhound Industry Advancement Fund

ABN 11 410 570 066

Financial StatementsFor the Year Ended 30 June 2010

___________________________________________________________________________________________________________

CONTENTS PAGE

Auditor’s Independence Declaration 92

Statement of Comprehensive Income 93

Statement of Financial Position 94

Statement of Changes in Equity 94

Statement of Cash Flow 95

Notes to the Financial Statements 96

Declaration by Members of the Board 102

Independent Audit Report 103

___________________________________________________________________________________________________________

9292

AUDITOR’S INDEPENDENCE DECLARATIONTO THE DIRECTORS OF GREYHOUND RACING NEW SOUTH WALES

GREYHOUND INDUSTRY ADVANCEMENT FUND___________________________________________________________________________________________________________

We hereby declare that to the best of our knowledge and belief, during the financial year ended 30 June 2010 there have been no:

(i) contraventions of auditor independence requirements in relation to the audit; and

(ii) contraventions of any applicable code of professional conduct in relation to the audit.

KS Black & Co Chartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church Street North Parramatta NSW 2151

Dated this 28th day of September 2010

93

STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $REVENUE Transfer from GRNSW Distribution Account 2 700,000 550,000

Interest Received 921 3,455

Greyhounds as Pets (GAP) 17,952 13,059

Insurance Penalties 15,500 5,450

Other 13,750 - TOTAL REVENUE 748,123 571,964 EXPENDITURE Payments to Clubs 6 325,749 297,303

NSW Blue Paws 200,000 150,000

Greyhounds as Pets (GAP) 172,711 168,960

Insurance Claims 10,000 28,216

Greyhound of the Year 84,136 74,004

Other 12,566 5,973 TOTAL EXPENDITURE 805,164 724,456 (DEFICIT)/SURPLUS FOR THE YEAR (57,041) (152,492)

The accompanying notes form part of these financial statements.

94

STATEMENT OF FINANCIAL POSITIONAS AT 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CURRENT ASSETS Cash and cash equivalents 3 12,232 53,678

Receivables 4 258,898 340,352 TOTAL CURRENT ASSETS 271,130 394,030 CURRENT LIABILITIES Payables 5 111,960 177,819 TOTAL CURRENT LIABILITIES 111,960 177,819 NET ASSETS 159,170 216,211 EQUITY Retained Earnings 159,170 216,211 TOTAL EQUITY 159,170 216,211

___________________________________________________________________________________________________________

STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $RETAINED EARNINGS Retained earnings at 30 June 2009 216,211 268,703

Surplus/(deficit) attributable to the fund (57,041) (152,492)

Transfer from Insurance Claim Reserve - 100,000 Retained earnings as at 30 June 2010 159,170 216,211

The accompanying notes form part of these financial statements.

95

STATEMENT OF CASH FLOWFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CASH FLOwS FROM OPERATING ACTIVITIES Inflows

Distribution Account 700,000 550,000

Interest Received 921 3,455

Insurance Penalties 15,500 5,450

Other 34,872 - 751,293 558,905 Outflows

Payments to Blue Paws 200,000 150,000

Insurance Claims 10,000 28,216

Payments to Clubs 6 358,324 301,454

Other Payments 224,415 260,268 792,739 739,938 Net cash flow provided by/(used in) Operations 7 (41,446) (181,033) Net (Decrease)/Increase in Cash and Cash Equivalents Held (41,446) (181,033) Cash and Cash Equivalents at 1 July 2009 53,678 234,711 Cash and Cash Equivalents at 30 June 2010 12,232 53,678

The accompanying notes form part of these financial statements

96

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES

The Greyhound Racing New South Wales Greyhound Industry Advancement Fund (GIAF) Account has been established in accordance with the Scheme of Distribution Policy. It is a special fund to further the strategic development of the NSW greyhound racing industry for the benefit of greyhound racing clubs and industry participants.

The GIAF receives an allocation of TAB distribution funds, determined by the Board to be in the best interests of the strategic development of the New South Wales greyhound racing industry, at the time of determining the industry budget.

Greyhound Racing New South Wales Greyhound Industry Advancement Fund is a reporting entity.

The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, including Accounting Interpretations and other pronouncements of the Australia Accounting Standards Board.

The financial report of Greyhound Racing New South Wales Greyhound Industry Advancement Fund complies with all International Financial Reporting Standards (IFRS) in their entity.

The following is a summary of the material accounting policies adopted by the entity in the preparation of the financial report. The accounting policies have been consistently applied unless otherwise stated.

Basis of Preparation

The accounting policies set out below have been consistently applied to all years presented.

The financial report has been prepared on an accruals basis and is based on historical costs.

(a) Insurance

The Greyhound Racing New South Wales Greyhound Industry Advancement Fund has no assets which require insurance cover. The insurance cover of any asset used by the Greyhound Racing New South Wales Greyhound Industry Advancement Fund is the responsibility of Greyhound Racing New South Wales.

(b) Administration Costs

The costs associated with the administration of the Greyhound Racing New South Wales Greyhound Industry Advancement Fund are borne by Greyhound Racing New South Wales. Employees of that body carry out the administrative functions.

97

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(c) Revenue

The Greyhound Industry Advancement Fund receives its main source of income from the Greyhound Racing New South Wales Distribution Account.

Revenue from the distribution account is brought to account on an accruals basis based on the date of issue of the invoice by Greyhound Racing New South Wales Distribution Account.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

All revenue is recognised net of the amount of goods and services tax (GST)

(d) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less.

(e) Receivables, Payables, and Accruals

Accounts receivable generally settled within 30 days are carried at amounts due.

Accounts Payable including accruals not yet billed, are recognised when Greyhound Racing New South Wales Greyhound Industry Advancement Fund becomes obliged to make future payments as a result of a purchase of assets or services. Accounts Payables are generally settled within 30 days.

(f) Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or part of an item of expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST.

Cash flows are presented in the Statement of Cash Flow on a gross basis.

98

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(g) Financial Instruments Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out below.

Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

Financial Liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

___________________________________________________________________________________________________________

2. TRANSFER FROM GREYHOUND RACING NEw SOUTH wALES DISTRIBUTION ACCOUNT

In line with past practice, the Board of Greyhound Racing New South Wales resolved to make a payment from the Distribution Account to the Greyhound Industry Advancement Fund to fund those programs determined to be important in the strategic development of the industry. These programs included major initiatives such as the GRNSW Country Challenge, Club Partnership Grants and Blue Paws Breeders & Owners Incentive Scheme contributions.___________________________________________________________________________________________________________

2010 2009 $ $3. CASH AND CASH EQUIVALENTS Cash at Bank (5,333) 36,862Short term deposits (Treasury Corp) 17,565 16,816

12,232 53,678___________________________________________________________________________________________________________ 4. RECEIVABLES GRNSW Distribution Account 255,329 236,712Other 3,569 51,269 258,898 287,981___________________________________________________________________________________________________________5. PAYABLES Blue Paws Owners & Breeders Incentive Scheme 33,338 37,500Trade Creditors & Accruals 78,622 87,947

111,960 125,447

99

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

6. PAYMENTS TO CLUBS

Payments to Clubs include funds provided under the Club Partnership Grant initiative, funds provided to be paid as prizemoney at Country Challenge events and payments for the retention of bookkeepers at non-TAB clubs.___________________________________________________________________________________________________________

7. RECONCILIATION OF CASHFLOw FROM OPERATIONS wITH (DEFICIT)/SURPLUS 2010 2009 $ $ (Deficit)/Surplus (57,041) (152,492) CHANGES IN ASSETS AND LIABILITIES (Increase)/Decrease in Receivables 81,454 (27,991)

Increase/(Decrease) in Payables (65,859) (550) Net cash provided by/(used in) operating activities (41,446) (181,033)___________________________________________________________________________________________________________ 8. FINANCIAL RISK MANAGEMENT

a) General objectives, policies and processes In common with all businesses, the entity is exposed to risks that arise from its use of financial instruments. This note describes the

entity’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the entity’s exposure to financial instrument risks, it’s objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

The Board has overall responsibility for the determination of the entity’s risk management objectives and policies. The entity’s risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the entity where such impacts may be material. The Board receives reports through which it reviews the effectiveness of the process put in place and the appropriateness of the objectives and policies it sets.

The overall objective of the Board is to set policies that seek to reduce the risk as far as possible. Further details regarding these policies are set out below:

100

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

8. FINANCIAL RISK MANAGEMENT (cont’d)

b) Credit risk Credit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the entity

incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing to the entity.

There is no concentration of credit risk with respect to receivables as the entity has government instrumentalities as debtors only. As a result, the credit quality of financial assets that are neither past due nor impaired is good.

The maximum exposure to credit risk at balance date is as follows:

2010 2009 $ $ Receivables 258,898 287,981

c) Liquidity risk Liquidity is the risk that the entity may encounter difficulties raising funds to meet commitments associated with financial

instruments that is creditors. It is the policy of the Board that the entity maintains adequate funds.

Maturity Analysis

2010 Carrying Contractual Amount Cash Flows < 6 months $ $ $ Financial Liabilities Non-derivatives Current payables 111,960 111,960 111,960 2009 Carrying Contractual Amount Cash Flows < 6 months $ $ $ Financial Liabilities Non-derivatives Current payables 125,447 125,447 125,447

d) Market risk Market risk arises from the use of interest bearing financial instruments. It is the risk that the fair value or future cash flows of a

financial instrument will fluctuate because of changes in interest rates (interest rate risk).

(i) Interest rate risk The entity is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk.

101

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

8. FINANCIAL RISK MANAGEMENT (cont’d)

d) Market risk (cont’d)

Sensitivity analysis The following tables demonstrate the sensitivity to a reasonably possible change in interest rates, with all other variables held

constant, of the entity’s results (through the impact on adjusted interest rate).

2010 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & cash equivalents 12,232 122 (122)

The above analysis assumes all other variables remain constant.

2009 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & cash equivalents 53,678 537 (537)

102

DECLARATION BY MEMBERS OF THE BOARD

___________________________________________________________________________________________________________

The Board of Greyhound Racing New South Wales declares that:

The financial statements and notes as set out on pages 93 to 101 present fairly the financial position of Greyhound Racing New South Wales Greyhound Industry Advancement Fund as at 30 June 2010 and its performance for the year ended on that date in accordance with Accounting Standards (including Australian Accounting Interpretations).

In the Board’s opinion, there are reasonable grounds to believe that the entity will be able to pay its debts as and when they become due and payable.

This declaration is made in accordance with a resolution of the Board of Greyhound Racing New South Wales.

Dated this 28th day of September 2010

Gabriel (Bill) MangafasGreyhound Racing New South Wales – Board Member

Tom GreenGreyhound Racing New South Wales – Board Member

103

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALESGREYHOUND INDUSTRY ADVANCEMENT FUND

___________________________________________________________________________________________________________

Report on the Financial Report

We have audited the accompanying financial report of Greyhound Racing New South Wales Greyhound Industry Advancement Fund, which comprises of the statement of financial position as at 30 June 2010, and the statement of comprehensive income, statement of changes in equity and statement of cash flow for the year ended on that date, a summary of significant accounting policies and other explanatory notes and the declaration by members of the Board as set out on pages 93 to 102.

Responsibility for the Financial Statements

The Board of Greyhound Racing New South Wales Greyhound Industry Advancement Fund are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations). This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Australian professional ethical pronouncements.

104

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

GREYHOUND INDUSTRY ADVANCEMENT FUND (cont’d)___________________________________________________________________________________________________________

Auditor’s Opinion

In our opinion the financial report of Greyhound Industry Advancement Fund;

(i) gives a true and fair view of the fund’s financial position of the Fund as at 30 June 2010 and of its performance for the year ended on that date; and

(ii) complies with Australian Accounting Standards (including the Australian Accounting Interpretations).

KS Black & CoChartered Accountants

Stuart H. Cameron

Level 1, 460 Church Street, North Parramatta NSW 2151

Dated this 28th day of September 2010

105

FINANCIAL STATEMENTSFor the Year Ended 30 June 2010

Greyhound Racing New South WalesBlue Paws Breeders & Owners

Incentive SchemeABN 11 410 570 066

Financial StatementsFor the Year Ended 30 June 2010

___________________________________________________________________________________________________________

CONTENTS PAGE

Auditor’s Independence Declaration 106

Statement of Comprehensive Income 107

Statement of Financial Position 108

Statement of Changes in Equity 108

Statement of Cash Flow 109

Notes to the Financial Statements 110

Declaration by Members of the Board 115

Independent Audit Report 116

___________________________________________________________________________________________________________

106

AUDITOR’S INDEPENDENCE DECLARATIONTO THE DIRECTORS OF GREYHOUND RACING NEW SOUTH WALES

BLUE PAWS BREEDERS & OWNERS INCENTIVE SCHEME___________________________________________________________________________________________________________

We hereby declare that to the best of our knowledge and belief, during the financial year ended 30 June 2010 there have been no:

(i) contraventions of auditor independence requirements in relation to the audit; and

(ii) contraventions of any applicable code of professional conduct in relation to the audit.

KS Black & Co Chartered Accountants

Stuart H. CameronPartner

Level 1, 460 Church Street, North Parramatta NSW 2151

Dated this 28th day of September 2010

107

STATEMENT OF COMPREHENSIVE INCOMEFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________ 2010 2009 $ $REVENUE Pup Contributions 96,943 78,422GIAF Contribution 200,000 150,000Interest Received 673 1,213Other Income 1,950 TOTAL REVENUE 299,566 229,635 EXPENDITURE Bank Charges 624 1,676Bonus Prizemoney 282,613 292,517 TOTAL EXPENDITURE 283,237 294,193 SURPLUS/(DEFICIT) FOR THE YEAR 16,329 (64,558)

The accompanying notes form part of these financial statements.

108

STATEMENT OF FINANCIAL POSITIONAS AT 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CURRENT ASSETS Cash and cash equivalents 2 50,452 19,254Receivables 3 38,115 48,934 TOTAL CURRENT ASSETS 88,567 68,188 CURRENT LIABILITIES Payables 19,867 15,817 TOTAL CURRENT LIABILITIES 19,867 15,817 NET ASSETS 68,700 52,371 EQUITY Retained Earnings 68,700 52,371 TOTAL EQUITY 68,700 52,371

___________________________________________________________________________________________________________

STATEMENT OF CHANGES IN EQUITYFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $ Retained earnings at 30 June 2009 52,371 116,929Surplus/(Deficit) attributable to the Scheme 16,329 (64,558) Retained earnings as at 30 June 2010 68,700 52,371

The accompanying notes form part of these financial statements.

109

STATEMENT OF CASH FLOWFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 Note $ $CASH FLOwS FROM OPERATING ACTIVITIES Receipts from Greyhound Industry Advancement Fund 200,000 150,000Receipts from customers 108,782 86,264Interest Received 673 1,213 Total Receipts 309,455 237,477 Cash paid to participants 278,257 278,306 Net Cash provided by (used in) Operating Activities 4 31,198 (40,829) Net Increase (Decrease) in Cash and Cash Equivalents Held 31,198 (40,829) Cash and Cash Equivalents at beginning of year 2 19,254 60,083 Cash and Cash Equivalents at end of year 2 50,452 19,254

The accompanying notes form part of these financial statements.

110

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES

Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme was established on 20 December 2005. Its aim is to promote, develop and encourage investment in the breeding of greyhounds in NSW. Greyhounds registered as part of the Blue Paw Breeders & Owners Incentive Scheme are entitled to receive bonus prizemoney on certain races conducted throughout NSW commencing from 1 July 2006.

The financial report is a general purpose financial report that has been prepared in accordance with Accounting Standards, including Accounting Interpretations and other pronouncements of the Australia Accounting Standards Board.

The financial report of Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme complies with all International Financial Reporting Standards (IFRS).

The following is a summary of the material accounting policies adopted by the entity in the preparation of the financial report. The accounting policies have been consistently applied unless otherwise stated.

Basis of Preparation

The accounting policies set out below have been consistently applied to all years presented.

The financial report has been prepared on an accruals basis and is based on historical costs.

(a) Insurance

The Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme has no assets which require insurance cover. The insurance cover of any asset used by the Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme is the responsibility of Greyhound Racing New South Wales.

(b) Administration Costs

The costs associated with the administration of the Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme are borne by Greyhound Racing New South Wales. Employees of that body carry out the administrative functions.

(c) Revenue

Revenue is brought to account on an accruals basis based on the date of issue of the invoice by Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme.

Interest revenue is recognised on a proportional basis taking into account the interest rates applicable to the financial assets.

All revenue is recognised net of the amount of goods and services tax (GST).

111

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

1. STATEMENT OF ACCOUNTING POLICIES (cont’d)

(d) Cash and Cash Equivalents

Cash and cash equivalents include cash on hand, deposits held at call with banks, other short term highly liquid investments with original maturities of three months or less.

(e) Receivables, Payables & Accruals Accounts receivable generally settled within 30 days are carried at amounts due.

Accounts Payable including accruals not yet billed, are recognised when Greyhound Racing New South Wales becomes obliged to make future payments as a result of a purchase of assets or services. Accounts Payables are generally settled within 30 days.

(f) Goods and Services Tax (GST)

Revenue, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office. In these circumstances, the GST is recognised as part of the cost of acquisition of the asset or part of an item of expense. Receivables and payables in the Statement of Financial Position are shown inclusive of GST.

(g) Financial Instruments

Recognition

Financial instruments are initially measured at cost on trade date, which includes transaction costs, when the related contractual rights or obligations exist. Subsequent to initial recognition, these instruments are measured as set out below.

Loans and Receivables

Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are stated at amortised cost using the effective interest rate method.

Financial Liabilities

Non-derivative financial liabilities are recognised at amortised cost, comprising original debt less principal payments and amortisation.

___________________________________________________________________________________________________________

2010 2009 $ $ 2. CASH AND CASH EQUIVALENTS Cash at Bank 37,293 6,656T Corp 13,159 12,598 50,452 19,254

112

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

2010 2009 $ $3. RECEIVABLES CURRENT GRNSW Greyhound Industry Advancement Fund - 37,500Accounts Receivable 38,115 11,434 38,115 48,934

___________________________________________________________________________________________________________ 4. RECONCILIATION OF CASH FLOw FROM OPERATIONS wITH SURPLUS/(LOSS) Surplus/(Loss) 16,330 (64,558) Changes in assets and liabilities: (Increase)/Decrease in Receivables 10,818 27,352Increase/(Decrease) in Payables 4,050 (3,623) Net cash provided by/(used in) operating activities 31,198 (40,829)

___________________________________________________________________________________________________________

5. FINANCIAL RISK MANAGEMENT

a) General objectives, policies and processes In common with all businesses, the entity is exposed to risks that arise from its use of financial instruments. This note describes the

entity’s objectives, policies and processes for managing those risks and the methods used to measure them. Further quantitative information in respect of these risks is presented throughout these financial statements.

There have been no substantive changes in the entity’s exposure to financial instrument risks, it’s objectives, policies and processes for managing those risks or the methods used to measure them from previous periods unless otherwise stated in this note.

The Board has overall responsibility for the determination of the entity’s risk management objectives and policies. The entity’s risk management policies and objectives are therefore designed to minimise the potential impacts of these risks on the results of the entity where such impacts may be material. The Board receives reports through which it reviews the effectiveness of the process put in place and the appropriateness of the objectives and policies it sets.

The overall objective of the Board is to set policies that seek to reduce the risk as far as possible. Further details regarding these policies are set out below:

113

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

5. FINANCIAL RISK MANAGEMENT (cont’d)

b) Credit risk Credit risk is the risk that the other party to a financial instrument will fail to discharge their obligation resulting in the entity incurring a financial loss. This usually occurs when debtors or counterparties to derivative contracts fail to settle their obligations owing to the entity. There is no concentration of credit risk with respect to receivables as the entity has

government instrumentalities as its primary debtor. As a result, the credit quality of financial assets that are neither past due nor impaired is good.

The maximum exposure to credit risk at balance date is as follows:

2010 2009 $ $ Receivables 38,115 48,934

c) Liquidity riskLiquidity is the risk that the entity may encounter difficulties raising funds to meet commitments associated with financial instruments that is creditors. It is the policy of the Board that the entity maintains adequate funds.

Maturity Analysis

2010 Carrying Contractual Amount Cash Flows < 6 months $ $ $ Financial Liabilities Non-derivatives Current payables 19,867 19,867 19,867 2009 Carrying Contractual Amount Cash Flows < 6 months $ $ $ Financial Liabilities Non-derivatives Current payables 15,817 15,817 15,817

114

NOTES TO THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 30 JUNE 2010

___________________________________________________________________________________________________________

5. FINANCIAL RISK MANAGEMENT (cont’d)

d) Market risk Market risk arises from the use of interest bearing financial instruments. It is the risk that the fair value or future cash flows of a

financial instrument will fluctuate because of changes in interest rates (interest rate risk).

(i) Interest rate risk The entity is constantly monitoring its exposure to trends and fluctuations in interest rates in order to manage interest rate risk.

(ii) Sensitivity analysis The following tables demonstrate the sensitivity to a reasonably possible change in interest rates, with all other variables held

constant, of the entity’s results (through the impact on adjusted interest rate).

2010 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & cash equivalents 50,452 505 (505)

The above analysis assumes all other variables remain constant.

2009 Carrying +1% Interest -1% Interest Amount Rate Rate $ $ $ Cash & cash equivalents 19,254 193 (193)

115

DECLARATION BY MEMBERS OF THE BOARD

___________________________________________________________________________________________________________

The Board of Greyhound Racing New South Wales declares that:

The financial statements and notes as set out on pages 107 to 114 present fairly the financial position of Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme as at 30 June 2010 and its performance for the period ended on that date in accordance with Accounting Standards (including Australian Accounting Interpretations).

In the Board’s opinion, there are reasonable grounds to believe that the entity will be able to pay its debts as and when they become due and payable, provided financial support is continued by the Greyhound Industry Advancement Fund.

This declaration is made in accordance with a resolution of the Board of Greyhound Racing New South Wales.

Dated this 28th day of September 2010

Gabriel (Bill) MangafasGreyhound Racing New South Wales – Board Member

Tom GreenGreyhound Racing New South Wales – Board Member

116

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

BLUE PAWS BREEDERS & OWNERS INCENTIVE SCHEME___________________________________________________________________________________________________________

Report on the Financial Report

We have audited the accompanying financial report of Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme, which comprises of the statement of financial position as at 30 June 2010, and the statement of comprehensive income, statement of changes in equity and statement of cash flow for the year ended on that date, a summary of significant accounting policies and other explanatory notes and the declaration by members of the Board as set out on pages 107 to 115.

Responsibility for the Financial Statements

The Board of Greyhound Racing New South Wales Blue Paws Breeders & Owners Incentive Scheme are responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations). This responsibility includes establishing and maintaining internal control relevant to the preparation and fair presentation of the financial report that is free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility

Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. The Auditing Standards require that we comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial report is free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor’s judgement, including the assessment of risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Board, as well as evaluating the overall presentation of the financial report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Independence

In conducting our audit, we have complied with the independence requirements of the Australian professional ethical pronouncements.

117

INDEPENDENT AUDIT REPORTFOR GREYHOUND RACING NEW SOUTH WALES

BLUE PAWS BREEDERS & OWNERS INCENTIVE SCHEME (cont’d)___________________________________________________________________________________________________________

Auditor’s Opinion

In our opinion the financial report of the Blue Paws Breeders & Owners Incentive Scheme:

i) gives a true and fair view of the financial position of the Scheme as at 30 June 2010 and of its performance for the year ended on that date; and

ii) complies with Australian Accounting Standards (including the Australian Accounting Interpretations).

KS Black & CoChartered Accountants

Stuart H. Cameron

Level 1, 460 Church Street, North Parramatta NSW 2151

Dated this 28th day of September 2010

118

NOTES

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Greyhound Racing NSW (GRNSW) is a body corporate charged with providing strategic direction and leadership in the development, integrity and welfare of greyhound racing in New South Wales (NSW). It is the peak body of the sport and is responsible for ensuring the competitiveness and long-term commercial viability of greyhound racing for the benefit of participants, commercial partners and the community.

From July 2009, GRNSW became responsible for the regulatory affairs of the sport. This broadening of responsibilities was the result of a government decision to transfer the greyhound division functions of the Greyhound and Harness Racing Regulatory Authority (GHRRA) to GRNSW.

In July 2010, GRNSW undertook an organisational restructure to ensure there were distinct business units responsible for the implementation of the new strategic plan Chasing 2020. The new structure covers both the commercial and regulatory responsibilities of GRNSW with four core business units: Racing & Integrity, Member & Club Services, Brand & Public Relations and Growth & Sustainability.

Our six member Board remained unchanged during 2009/10. The Board comprises of nominees from the NSW National Coursing Association, the NSW Greyhound Breeders Owners & Trainers Association, the TAB clubs, the country clubs and industry participants. Our Chairman is independent and appointed by the Board members.

Our VisionTo be Australia’s premier supplier of greyhound racing, delivering an attractive and innovative wagering product, and focused on

long-term sustainable growth that will drive increased prizemoney returns to participants and appeal to consumers.

Core ValuesOur plan and strategic vision is based upon the following core values:

Innovation•Integrity•Teamwork•Professionalism•Performance driven•Customer focus•

Chasing 2020GRNSW released its strategic plan, Chasing 2020, on 27 July 2010 to provide stakeholders with an understanding of how it intends to grow and position the sport into the future.

Feedback gathered from stakeholders during the consultation phase was vital in contributing to the framework on which the strategic plan was built. Chasing 2020 outlines a shared vision and set of goals that will ensure greyhound racing in NSW continues to prosper into the future.

Produced by the GRNSW Board, the future-looking document includes five key pillars of strategic focus: Growth; Image; Racing; Sustainability; and Governance. Each pillar outlines strategies that will provide a range of benefits to all stakeholder groups. Chasing 2020 will be supported by a standalone operational plan, to be monitored on a quarterly basis and reported to the public yearly as part of GRNSW’s Annual Report.

Who is GRNSW ?___________________________________________________________________________________________________________

___________________________________________________________________________________________________________

Greyhound Racing NSW___________________________________________________________________________________________________________

Head OfficeBuilding B, 1 Homebush Bay Drive

Rhodes NSW 2138Australia

Tel: +61 2 8767 0500Fax: +61 2 9764 6244

•Postal Address:PO Box 170

Concord West NSW 2138•

Email: [email protected] Web: www.thedogs.com.au

•Auditors

KS Black & CoLevel 1

460 Church StreetNorth Parramatta

NSW 2151Australia

•SolicitorsClayton Utz

1 O’Connell StreetSydney NSW 2000

Australia•

BankersCommonwealth Bank of Australia

1-3 Auburn RoadAuburn NSW 2144

Australia

ABN 61 018 166 136Building B, 1 Homebush Bay Drive, Rhodes NSW 2138 AustraliaTel. 61.2.8767 0500 Fax. 61.2.9764 6244 Web. www.thedogs.com.au

GREYHOUND RACING NSW