Potato Marketing Corporation of Western Australia 2003 · Marketing Corporation of Western Australia for the year ended ... Our long-term trading relationship with Mauritius ... Agricultural

2003A N N U A L R E P O R T

P o t a t o M a r k e t i n g C o r p o r a t i o n

o f W e s t e r n A u s t r a l i a

TABLE OF CONTENTS

Letter to the Minister . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

The Year in Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2

Organisational Profile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Overview of the Potato Industry in Western Australia . . . . . . . . . . . . . . . . 4

Chairman’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6

Chief Executive Officer’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7

Organisational Highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9

Pool Results 2002-2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10

Organisational Outcomes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12

Marketing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

Operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18

Quality Assurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21

Finance and Administration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23

Organisational Structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26

Members of the Board . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27

Staff . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29

Corporate Governance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30

Compliance Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31

Compliance with Legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32

Compliance Reporting Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34

Letter from the Auditor General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35

Certification of Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36

Statement of Financial Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37

Statement of Financial Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38

Statement of Cash Flows . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39

Notes to the Financial Statements 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . 40

Performance Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54

Letter from the Auditor General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55

Certification of Performance Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56

Performance Indicators . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 57

Appendices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58

Statistical Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 59

Annual Estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 60

List of Publications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62

STREET ADDRESS

Cockburn RoadHamilton HillWestern Australia 6163

POSTAL ADDRESS

PO Box 62South FremantleWestern Australia 6162

TELEPHONE

(61 8) 9335 8999

FACSIMILE

(61 8) 9335 9945

EMAIL

[email protected]

WEB SITE

www.westernpotatoes.com.au

Page

Dear Minister

In accordance with Section 66 of the Financial Administration and Audit Act (1985), we hereby

submit for your information and presentation to Parliament the Annual Report of the Potato

Marketing Corporation of Western Australia for the year ended 30 June 2003.

The Report has been prepared in accordance with the provisions of the Financial Administration

and Audit Act (1985).

Yours sincerely

Jim Murphy Geoffrey Hick

CHAIRMAN BOARD MEMBER

P O T A T O M A R K E T I N G C O R P O R A T I O N O F W E S T E R N A U S T R A L I A – A N N U A L R E P O R T 2 0 0 3

Hon. Kim Chance, MLCMinister for Agriculture, Forestry and Fisheries

PAGE 1

Letter to the Min i s ter

The Year in Rev iew

■ Organisat ional Prof i le

■ Overv iew of the Potato Industry inWestern Austra l ia

■ Chairman’s Report

■ Chief Execut ive Off icer ’s Report

■ Organisat ional Highl ights

■ Pool Results 2002-2003

PAGE 2


PAGE 3

Organisat iona l Prof i le

Function of Western Potatoes

The functions of Western Potatoes, in accordance with

Section 17A of the Marketing of Potatoes Act (1946)

are as follows:

■ Regulate the production of ware potatoes so as

to ensure the supply of quantities, kinds and

qualities preferred by consumers in the state

■ Take delivery of, and otherwise deal with,

potatoes in accordance with this Act and market

potatoes in the state and elsewhere

■ Register persons who are to be authorised to

carry on business as a commercial producer of

potatoes, and license the areas of land to be

used in any such business

■ Encourage and promote the use of potatoes and

provide for the monitoring and, if thought fit,

regulation of the production of potatoes for

propagation or for any other prescribed kind of

use

■ Foster methods of production and adopt

methods of marketing that will enable potatoes

grown in the state to compete in price and

quality against potatoes from alternative sources

of supply

■ Promote, encourage, fund and arrange for the

conduct of research into matters relating to the

production and marketing of potatoes, and

undertake market development

■ Seek and apply knowledge of new and improved

techniques and materials that will assist it to

perform its functions

Responsible Minister

The Corporation reports to the Hon. Kim Chance MLC,

Minister for Agriculture, Forestry and Fisheries.

The Minister draws his powers from Section 20A of

the Marketing of Potatoes Act (1946) which gives

power to direct the Corporation in writing concerning

the performance of its functions, either generally or

with respect to a particular matter.

The Potato Marketing Corporation of Western Australia (otherwise known as Western Potatoes) is the only

statutory marketing organisation for potatoes in Australia. It was established under the Marketing of Potatoes

Act (1946) for the purpose of managing the production and supply of potatoes and promoting their use so as

to satisfy market needs.

Western Potatoes is responsible for encouraging growers, washpackers and retailers to provide fresh Western

Australian potatoes all year round.

Our mission is to provide leadership to all stakeholders in the supply chain in order to build and maintain an

efficient, profitable and sustainable industry that is responsive to market needs.

Overview of the Potato Industry in Western Australia

Export and Processing Markets

The export and processing markets are deregulated.

Growers are free to grow for these markets; however,

they require a licence from Western Potatoes to do so.

The licence allows for production monitoring and

prevents potatoes grown for these markets from

entering into the domestic market.

Domestic Market

The production of potatoes for the domestic market is

managed to align supply within 5% of the anticipated

demand. This minimises the waste of resources that

would otherwise result if overproduction occurred.

All potato production for the domestic market is

regulated through a licensing system. The system is

aimed at providing consumers with fresh potatoes all

year round and is achieved by incorporating Pools,

Licences, Delivery Schedules, Domestic Market

Entitlements and Grading.

PAGE 4

Potatoes are grown in Western Australia for two main markets:

■ export and processing; and

■ domestic.

Pools

Most potatoes produced for the Western Australian

domestic market are grown in the southwest corner of

the state. The major production districts are Manjimup,

Pemberton, Busselton, Myalup, Gingin, Donnybrook

and the Metropolitan region. The Albany district is the

major seed production area. Each growing season is

divided into Pools, shown below.

Domestic Market Entitlements

To coordinate the distribution of potatoes to the

washpackers, Western Potatoes issues domestic market

entitlements (DME) for specific tonnages to be

delivered. These DMEs are sent to growers who have

indicated their intention to deliver based on a delivery

schedule. Issuing DMEs allows the amount of potatoes

delivered by growers to equal the quantity required by

the washpackers.

Grading

The growers supply the potatoes to a registered

washpacker of their choice. There are five washpackers

registered with the Corporation, four of which are

located in the Metropolitan region. The washpackers

are responsible for washing and grading the potatoes

in accordance with grading requirements into five

grades: premium, class 1, class 2, smalls and drybrush.

Waste and soil are removed during this process. The

washpacker then completes a packout document

which provides weight details for each grade, soil and

waste.

The washpacker pays Western Potatoes according to

each grade detailed in the packout document. Western

Potatoes in turn pays the grower, less the

Corporation’s operating costs, through a series of

progressive payments called first, interim, second and

final payment. All growers in a Pool receive the same

dollar per tonne return for each grade.


PAGE 5

Overview of the Potato Industry in Western Australia (cont . )

Pool Dates for Season 2002–2003 Districts

1 01 July–24 August Busselton, Myalup, Metro, Gingin

2 25 August–05 October Busselton, Myalup, Metro, Gingin, Manjimup, Esperance

3 06 October–09 November Metro, Myalup, Busselton Gingin

4 10 November–21 December Busselton, Myalup, Donnybrook, Metro

5 22 December–08 March Manjimup, Pemberton, Rosa Brook

6 09 March–03 May Manjimup, Pemberton, Albany, Busselton, Donnybrook

7 04 May–30 June Busselton, Myalup, Donnybrook, Manjimup, Pemberton

Licences

Growers are required to apply for area licences to

produce and deliver the tonnage of potatoes grown in

the licensed areas based on expected yields. Area

licences are issued to growers before the start of each

Pool and are renewable on an annual basis.

Independent Surveyors are contracted to measure

planted crops via a global positioning system to

ensure the actual areas planted agree with licensed

areas.

Delivery Schedules

The licences issued by Western Potatoes incorporate a

weekly delivery schedule that indicates the tonnage of

potatoes that growers expect to deliver during a

specific week of the Pool. The schedule allows Western

Potatoes to coordinate production and provides

consumers with fresh potatoes all year round.

Chai rman’s Report

Jim MurphyCHAIRMAN

Although this year achieved record grower returns, early development of an export industry

and greater consumer acceptance of potato products, most attention was focused on the

decision of the State Government to retain the present system of regulation. Western

Potatoes is the only statutory corporation of its kind in Australia.

The decision, which was championed by the Minister for Agriculture, Forestry and Fisheries,

the Hon. Kim Chance MLC, allows all industry stakeholders the opportunity to continue to

participate in a viable and efficient industry, one that has proven to provide a net public

benefit under the most intense scrutiny. More specifically, it provides growers a time frame

in which to accept changes in their industry that will lead to greater opportunities to

participate in supply chain activities.

I thank the Board, management and staff of Western Potatoes for their commitment to the

achievement of the main objectives set for the corporation:

■ to provide a reliable source of fresh potatoes to consumers at a consistent price and

quality; and

■ to generate increased sales of ware potatoes resulting in improved returns to growers

and merchants.

We look forward to working with the various industry bodies to ensure the potato industry

continues to prosper

Jim Murphy

CHAIRMAN

PAGE 6

Grower Returns

The return to licensed growers for the year was

particularly good and some have even said, the best

ever. The amount paid to growers increased by

approximately 22% on the previous year and the

average return to growers exceeded $500.00 per

tonne.

The cost of running the Corporation expressed as a

percentage of total revenue has decreased from

approximately 14% to 11%. This is due to the

increased sales, improved efficiency and cost cutting

measures within the Corporation. The cost of running

the Corporation includes a significant amount to

advertise and promote the product.

Legislation Review

As reported in last year’s Annual Report, the

Corporation submitted detailed reports complied by

independent researchers in response to the concurrent

Legislation and National Competition Policy Reviews.

Subsequent to the financial year ending 30 June 2003,

the State Government announced that they have

agreed to the retention of the regulated system in

Western Australia.

The submission by Western Potatoes, which outlined

the economic, social and environmental effects of the

present system, was used by the State Government in

their justification of their decision to the National

Competition Council. The submission concluded the

present regulated system provides a net public benefit.

In retaining the regulated system, the Government has

requested the formation of an ‘Implementation

Committee’ to seek methods to improve the current

arrangements from all industry stakeholders. The

opportunity provided to the industry by the State

Government allows the industry sufficient time to

carry out the necessary improvements to ensure

ongoing compliance with the relevant legislation and

an efficient, sustainable industry.

Seed Export

Trading relationships are established and continuing

with companies in Mauritius, Indonesia and Sri Lanka

and there is a possibility of a developing market in

Vietnam.


Industry representatives on a recent visit to Sri Lanka

PAGE 7

Chief Execut ive Off icer ’s Report

Chris PerrottCHIEF EXECUTIVE OFFICER

Though there was considerable uncertainty throughout the year due to the Legislationand National Competition Policy Reviews, licensed potato growers in Western Australiareceived significantly improved returns. The returns to growers improved due toenhanced supply management and decreased competition from the eastern states ofAustralia.

Chief Execut ive Off icer ’s Report (cont . )

The opportunity to increase the trade in Indonesia and

Sri Lanka is very good. Both companies the

Corporation is dealing with have significant resources

and potential for growth within their domestic

markets.

Our long-term trading relationship with Mauritius

continues to grow for both ware and seed potatoes.

Although our market offer is competitive with

potatoes from India and South Africa, our client, the

Agricultural Marketing Board, indicate they prefer to

deal with Western Potatoes due to our reliability of

supply and trading record since the early 1980s.

Marketing

The marketing activities of the Corporation continue

to be effective with consumers readily recognising the

‘What, no potato?’ slogan and proving to be the best

educated consumers in Australia regarding the

varieties and attributes of potatoes.

Relationships with the major retailers continue to

improve with better feedback on marketing and supply

issues, along with greater interest in cooperative

advertising. A new marketing role was also created

with the person responsible working with retailers to

improve shelf quality, the number of varieties

displayed and overall presentation of potato displays

at store level.

Fresh Western

Fresh Western continued operations during the

financial year and returned a profit. The three variants

of potato mash products previously developed under

the Fresh Western brand continued to be marketed

and remained the only fresh mash products available

in retail outlets throughout Western Australia. There

were no new valued added products developed due to

the uncertainty of the direction of the industry.

However, a relationship was established with an

independently owned and operated retail potato shop

in Subiaco for the right to use intellectual property

owned by Western Potatoes.

People

It is a credit to the staff of Western Potatoes that they

have been able to provide potato growers with a very

good financial return during such an uncertain period.

In spite of the negativity surrounding the industry

during the review process, the staff at Western

Potatoes continued to focus on the business objectives

and should be congratulated for their efforts.

Outlook

Having been given an extension to the present system,

the industry has an opportunity to work together to

find solutions to any difficulties encountered under

the existing legislation. It is an industry which requires

stakeholders to be progressive and innovative. The

initiative by the Minister to establish the

‘Implementation Committee’ is the perfect forum for

industry participants to work together in good faith,

to improve and enhance the Western Australian

potato industry.

Chris Perrott

CHIEF EXECUTIVE OFFICER

PAGE 8

■ The return to growers was increased by approximately 22% on the previous year.

■ Production of the Royal Blue, Ruby Lou and Kestrel potato varieties has doubled.

■ Compliance of industry stakeholders resulted in enforcement of the Marketing of Potatoes Act (1946) and

Regulations.

■ Consistently high quality seed potatoes were produced for the domestic and international export market.

■ Existing relationships with national and international seed customers were maintained while new markets were

developed in South East Asia.

■ A new selection criterion was developed by the Potato Variety Commercialisation Group for the testing and

evaluation of all new varieties.

■ A Supply Management Officer was employed to ensure supply is consistent and stocktakes are carried out in

an accurate and timely manner.

■ Work continued with retailers at store level to improve potato displays and effectively utilise available point of

sale material.

■ A number of joint promotions were conducted with retail outlets to increase sales and awareness of potato

varieties.

■ Work commenced on developing a uniform grading standard based on retailer specifications involving

representatives from all sectors of the supply chain.

■ Consumer awareness of Royal Blue and Ruby Lou increased significantly by 13% and 11% respectively over the

past 12 months.

■ A total of 76 industry members are now SQF 2000CM certified, resulting in 75% of ware potatoes produced by

certified growers.

■ Potatoes of 64 growers were sampled and tested for chemical residues in 2002–2003.

■ A total of 82 on-site internal audits and HACCP plans reviews were carried out on certified businesses.

■ The process of updating and documenting policies and procedures was continued as required under the State

Records Act 2000.

■ A comprehensive risk review was undertaken during the year which identified no significant risks to the

Corporation.

■ An Accounting Officer was employed during the year to increase the effectiveness of the current financial

reporting system.


PAGE 9

Organisat iona l H igh l ights

Pool Resu l t s 2002-2003

Pool 1

1 July-24 August 2002

■ A total of 10,763 gross tonnes was received in

Pool 1.

■ The graph outlines percentage share by variety

of the total gross tonnes received in the Pool.

The total gross tonnes received by Pool are recorded below. This figure includes all tonnes (ware and seed) grown

under licensed area for both the local and export markets.

0

10

20

30

40

50

60

70

Oth

er

Ruby

Lou

Roya

l Blu

e

Nadi

ne

Mon

dial

Kest

rel

Eure

ka

Desir

ee

Dela

war

e

Carli

ngfo

rd

2001-2002

2002-2003

PERC

ENTA

GE

GROSS RECEIVALS BY VARIETY – POOL 1

4.75.7

30.7

4.40.3 2.5

45.3

1.24.6

0.54.3

17.5

0.65.2

3.1 1.9

58.9

1.24.6

2.7

Season Premium Class 1 Class 2 Smalls Drybrush Waste Soil2002–2003 4% 35% 32% 11% 2% 14% 2%

▼ Packout results by grade for Pool 1 are detailed in the table below:

0

10

20

30

40

50

60

70

Oth

er

Ruby

Lou

Roya

l Blu

e

Nadi

ne

Mon

dial

Kest

rel

Eure

ka

Dela

war

e

Carli

ngfo

rd

2001-2002

2002-2003

PERC

ENTA

GE


8.7

2.9 1.7

15

23.2

6 2.1 1.2 1.6

11 13.3

44.1

38.5

3.11.95.1

7.8

12.7



Pool 2

25 August-5 October 2002


Pool 2.



PAGE 10

Pool 3

6 October-9 November 2002


Pool 3.


of the total gross tonnes received in the Pool.0

10

20

30

40

50

60

70

Ruby

Lou

Oth

er

Roya

l Blu

e

Nadi

ne

Mon

dial

Kipf

ler

Kest

rel

Eure

ka

Desir

ee

Dela

war

e

Carli

ngfo

rd

2001-2002

2002-2003

PERC

ENTA

GE


1.1 0

22.6

15.8

0.94.7 4.3

0.4 0.8 0.2 0 0

6.9 11.2

48.6 48

1.6 4.5 5.7

117.4

4.3



PAGE 11

Pool 5

22 December-8 March 2003


Pool 5.



10

20

30

40

50

60

70

Oth

er

Ruby

Lou

Roya

l Blu

e

Nadi

ne

Mon

dial

Kipf

ler

Kest

rel

Eure

ka

Desir

ee

Dela

war

e

Carli

ngfo

rd

2001-2002

2002-2003

PERC

ENTA

GE


7.1 5.6 5.6

12.3

2.2 2.90.5 0.5

3 4.40.1 0 0.3 0

66.4 68.9

2.2 4.5 2.4 4.1 3.4 3.5



Pool 4

10 November-21 December 2002


Pool 4.



10

20

30

40

50

60

70

2001-2002

2002-2003

PERC

ENTA

GEGROSS RECEIVALS BY VARIETY – POOL 4

1.9 0

21.1

16.3

0.4 0.12.2 1.8 1.9

4.50.4 0

4.9 0.6

55.6

62.8

1.7 2.9 4.3

9.15.7

1.9

Oth

er

Ruby

Lou

Roya

l Blu

e

Nadi

ne

Mon

dial

Kipf

ler

Kest

rel

Eure

ka

Desir

ee

Dela

war

e

Carli

ngfo

rd



0

10

20

30

40

50

60

70

Oth

er

Ruby

Lou

Roya

l Blu

e

Nadi

ne

Mon

dial

Kest

rel

Eure

ka

Desir

ee

Dela

war

e

Carli

ngfo

rd

2001-2002

2002-2003

PERC

ENTA

GE


4.21.6

13.9

6.21.2 1.2

5.4

0.52.6 3.4

0.42.4

67.6

56.9

1.84.8 3.0 4.0

7.511.3



Pool 7

4 May-30 June 2003


Pool 7.



10

20

30

40

50

60

70

80

Oth

er

Ruby

Lou

Roya

l Blu

e

Nadi

ne

Mon

dial

Kest

rel

Eure

ka

Desir

ee

Dela

war

e

Carli

ngfo

rd

2001-2002

2002-2003

PERC

ENTA

GE

GROSS RECEIVALS BY VARIETY–POOL 7

3.2 0.8

11.2

3.91.3 1.3

6.2

0.44.1 3.1

0 1.5

60.2

74.9

2.2 3.36.9 6.8

4.7 4.0



Pool 6

9 March-3 May 2003


Pool 6.



Organisat iona l Outcomes

■ M a r k e t i n g

■ O p e ra t i o n s

■ Q u a l i t y A s s u ra n c e

■ F i n a n c e a n d A d m i n i s t ra t i o n

PAGE 12

Market research undertaken each year provides

valuable feedback with respect to purchase and

consumption patterns of potatoes in comparison to

rice and pasta. The research also provides information

regarding the effectiveness of the delivery of the

marketing and promotional messages to consumers.

Potatoes still continue to be the food eaten most often

by Western Australian consumers when compared to

rice and pasta. Given the intensity of the publicity

associated with no carbohydrate diets and the change

in attitudes towards healthier lifestyles and food

trends in general, the key area of focus over the past

12 months has been to continue to increase

consumption among consumers who have been

identified as ‘lighter users’ and further improve

consumer perceptions of potatoes by highlighting

their nutritional value and associated health benefits.

Additional attention has also been placed on

increasing the level of communication and training

material available to the retail sector.

Consumer expectations andconsumption behaviour in the easternstates

A research study commissioned by Horticulture

Australia was conducted in July 2002 to survey

consumer attitudes and consumption patterns

towards fresh potatoes in the eastern states. The

research reported a decline in consumption of fresh

potatoes in the eastern states with potatoes losing

market share to rice and pasta. When consumers were

asked what do potato growers need to do to get them

to buy and use more potatoes they stated they wanted

to see more information about varieties and their

cooking uses, education with respect to the health

benefits of potatoes, and more recipe ideas that are

low fat and quick and easy to cook.


PAGE 13

Market ing

In accordance with the corporate business objectives and performance indicators, the marketingteam is primarily responsible for increasing awareness of potato varieties and contributing to anincrease in the sale of fresh potatoes to the local market in Western Australia. This is achievedthrough an integrated marketing program focusing primarily on areas such as advertising, salespromotions, public relations, sponsorship and product development.

Market ing (cont . )

Given potato growers in the eastern states do not

conduct any significant marketing activity, to arrest

the decline in fresh potato consumption in the eastern

states the research study recommended the industry

develops a strategic marketing approach which

focuses more on consumer requirements and less on

production. This recommendation reinforces the

success and importance of the marketing activity

conducted by Western Potatoes in Western Australia

as our campaign addresses all of the issues identified

as a concern to consumers in the eastern states

research. Further results from this study are referred

to throughout this report.

An outline of the core objectives of the marketing

team for 2002–2003 is below.

Objectives for 2002-2003

Increase consumption among light users

Over two-thirds of consumers identify potatoes as the

food eaten most often when compared with rice and

pasta. However, when this information is analysed by

age group there is a significant bias towards heavier

potato usage by older meal providers. To achieve an

improvement in the overall consumption of potatoes,

a focus was placed on increasing consumption among

those identified as less frequent users who were

typically aged between 18 to 35 years old.

Attention was given to ensuring that the delivery of

messages was appropriate to the younger target

audience. The design and layout of all print advertising

was updated to reflect a modern and contemporary

look and a series of new television commercials were

produced. The new design layout did not ignore

existing brand cornerstones such as Con the Fruiterer

and the ‘What, no potato?’ slogan which continued to

be an important feature in all advertising material.

The research showed recall of the advertising

messages was significantly higher by the younger age

groups during the past 12 months reflecting the

increased interest in the advertising by this target

market.

Restore and improve perceptions relating tothe nutritional/health value of potatoes

Western Potatoes launched a new aggressive

campaign to restore and improve consumer

perceptions relating to the nutritional/health value of

potatoes. Five new television commercials were

produced highlighting the nutritional benefits of

potatoes in comparison to rice and pasta. Specific

attention was given to promoting the no fat and no

cholesterol benefits and the high level of vitamin C

found in potatoes. To further reinforce these

messages, posters were exhibited near potato displays

in most retail outlets.

PAGE 14

The most recent research demonstrated an

improvement in the competitive positioning of

potatoes with 85% of Western Australian consumers

identifying potatoes as healthy and nutritious with

74% specifically positioning them as low in fat. These

results are in direct contrast to the research reported

in the eastern states where only 15% of consumers

perceived potatoes as a good source of vitamins and

minerals and 8% of people knew that potatoes were

low in fat.

Develop strong top of mind awareness ofpreferred varieties and their cookingattributes with the aim to increase purchasebehaviour of varieties by 5%

Although the more established varieties such as

Nadine and Delaware remain the most commonly

recalled, awareness of Royal Blue and Ruby Lou has

increased over the past 12 months by 13% and 11%

respectively. This is a relatively high increase in

awareness given these varieties are still fairly new to

the domestic market in Western Australia.

To reinforce the characteristics of the preferred

varieties with consumers, advertisements were

regularly placed in ‘The West Magazine’ which has a

readership of more than one million. Advertisements

were also placed in other relevant magazines. Print

advertisements were used as the preferred medium for

the variety campaign as they included the level of

detail needed to educate consumers including the

colour and cooking attributes of each variety.

Although the number of consumers in Western

Australia who specifically look for a particular variety

when shopping is still relatively low in comparison to

the level of awareness, it did increase by 5% over the

past 12 months.

Encourage all industry participants to strivefor superior quality standards at all timesthrough the development of supply chainrelationships

Several supply chain meetings with representatives

from growers through to retailers were held to identify

issues which were considered vital to the future

success of the potato industry. Under the direction of

Western Potatoes, the supply chain group approached

Horticulture Australia Limited for financial support

through the voluntary contribution scheme towards

developing a uniform grading standard based on

retailer specifications. The project was approved and is

expected to be completed by the supply chain group

by April 2004.

Improve product knowledge andcommunication to retailers and consumersvia in-store promotions

Considerable effort has been directed to improving the

communication to retailers and consumers over the

past 12 months. Effective use of promotional elements

at store level is integral to the success of the overall

advertising campaign.


PAGE 15



Given that 75% of consumers in Western Australia

indicate the meal they are intending to cook is one of

the greatest influences on their purchase decision,

maintaining the high level of exposure of potato

recipe cards at retail outlets is important.

Western Potatoes has worked over the past 12 months

to increase the level of training, education and

resources available to retailers. A new position titled

Retail Liaison Officer (created at the beginning of the

year) is responsible for developing a good rapport with

retailers at store level to ensure a high level of display

presentation is achieved and all available point of sale

material is used effectively.

Stores have been very responsive to the training and

assistance provided, welcoming the ongoing feedback

from Western Potatoes to help improve presentation

and customer satisfaction.

Further enhance Western Potatoes brandimage through advertising, sponsorship andpublic relations with the aim of maintainingrecognition

Awareness of the Western Potatoes brand was

sustained at a high level (84%) over the last 12

months following a period of significant growth since

1998. This is an exceptionally high level of awareness

for a brand which is not typically considered a

‘consumer brand’, reinforcing the success of the

marketing activity conducted over recent years. Brand

awareness also remains highest among the younger

target markets which remains positive for the future

direction of the advertising campaign.

Western Potatoes continued sponsorship of the Perth

Zoo Twilight Concert series held during February and

March. Attendance at the concerts has increased each

year and the event continues to provide a suitable

environment to positively reinforce brand image.

Other events contributing to brand awareness

attended over the past twelve months included the

Royal Show, Burswood Wine and Food Festival,

PAGE 16

Work was undertaken with each retail chain to

produce point of sale cards unique to each retailer’s

requirements. The card sets all convey the same

message promoting the different varieties and their

cooking characteristics; however, they vary slightly in

size and style for each retail chain.

Cooperative sales promotions were developed with

each retail chain with the aim of increasing awareness

and consumption of varieties. One particular

promotion conducted with Dewsons titled “Pick the

perfect potato for your purpose” reported an increase

in sales by over 12% during the promotional period

with stores also extending their range of varieties on

display. This was a good result for such a major

category in Fresh Produce.

Manjimup Horticultural Expo, Chilli Festival, Fairbridge

Festival, Glendi Festival and Perth Food and Wine Fair,

to name a few.

Ensure all industry stakeholders andconsumers are fully informed of all relevantactivities undertaken by Western Potatoes

The public relations strategy was reviewed to

complement the advertising and promotional

campaign with particular emphasis given to increasing

the level of communication to industry stakeholders.

Marketing Updates were established to report on a

monthly basis to growers the results of recent

marketing activities. A monthly fax to major retailers

and washpackers outlining details of forthcoming

promotional activities was also introduced to assist in

planning.

The Western Potatoes website continues to be an

essential communication tool for consumers and

industry alike. Continual improvements have been

made to both the consumer and industry sections

including the addition of a growers’ forum allowing

for online interaction between growers.

Identify and develop new product andmarket opportunities

The increased level of contact with retailers over the

past 12 months has resulted in a significant

improvement in the distribution of ancillary items such

as mircowaver capsules and potato pantries. These

items continue to provide stores with an opportunity

to boost sales and add value to the potato category.

Sales of the three ready-to-heat potato mash products

remained steady during the year in Woolworths, Coles

and independent retail outlets throughout Western

Australia. The products were developed in 2001 under

the Fresh Western brand, a wholly owned subsidiary of

Western Potatoes.

Given the success of the Western Potatoes

promotional campaign over the past decade, an

independent retailer located in Subiaco called ‘The

Potato Shop’ contacted Western Potatoes requesting

permission to use the registered trademark, ‘What, no

potato?’ to promote their market offer of ready-to-eat

potato dishes. Western Potatoes entered into a royalty

agreement which included the use of some

promotional material and the right to use the ‘What,

no potato?’ registered trademark.


PAGE 17


Outlook for 2003-2004

■ Contribute to an increase in the sale of fresh potatoes to the local

ware market over the next 12 months.

■ Increase consumption among the current light user group identified

as the young adult market.

■ Continue to promote the nutritional/health benefits of potatoes as a

way to combat negative perceptions and increase consumption.

■ Develop strong top of mind awareness of preferred varieties and

their cooking attributes with the aim to increase the level of

purchase behaviour of varieties.

■ Encourage all industry participants to strive for superior quality

standards at all times through the development of supply chain

relationships.

■ Maintain a high level of communication with retailers including the

development of in-store promotions and cooperative advertising.

■ Aim to maintain the existing high level of brand awareness.

■ Identify and develop new product and market opportunities.

■ Increase the level of education and promotion of potatoes to school

aged children.

Operat ions

1. Domestic market supply: Coordination of

production by volume and variety, wherever

possible matching supply to within 5% of

anticipated demand. The development of Royal

Blue as a preferred table potato has seen a large

increase in seed importation and local

production in order to meet the market demand.

2. Legislative compliance: The operations team are

also responsible for regulating and administering

the Marketing of Potatoes Act (1946) and

Regulations to growers, washpackers, agents,

processors and retailers. Compliance was greatly

enhanced due to the continued use of the new

crop measuring technique introduced the

previous year.

3. The development, management and

implementation of the seed and table potato

export program: The export program saw a

diversification into new varieties and sales into

three new markets.


Continue to focus on the production ofconsumer accepted varieties, whilstensuring the profitability of growers

Feedback of increased consumer acceptance of

varieties portraying enhanced flavour and cooking

characteristics saw growers commit to greater

production area of varieties such as Royal Blue, Ruby

Lou and Kestrel. There was a two-fold increase in

Royal Blue production, a 27% increase in Ruby Lou

and a 15% increase in Kestrel production.

The Potato Variety Commercialisation Group held

several meetings during the year to identify new

potato varieties considered suitable for further trial

and evaluation. A selection criterion for the testing

and evaluation of all new varieties was created to

ensure that customer and grower requirements are

addressed. Two varieties under trial showed particular

promise when assessed at the washpacker and retail

level. These varieties will continue to be tested as part

of the variety development program.

Strict adherence to the Marketing ofPotatoes Act and Regulations

An important role of administering the Marketing of

Potatoes Act (1946) includes monitoring industry

compliance within the provisions of the Act. During

the year some growers were penalised for planting an

area greater than their licence allowed. The use of a

Differential Global Positioning System (DGPS) has

greatly increased the accuracy of crop measuring,

giving Western Potatoes and growers greater certainty

when planting and monitoring crops. The system has

also significantly reduced the cost of measuring crops.

Complaints were pursued against some industry

participants with respect to receiving potatoes direct

from growers and not through the Corporation as

required by the legislation. Growers who planted more

than their licensed area were also penalised by way of

a licensed area reduction in the ensuing season.

Aerial Surveillance was used during the year to

identify crops grown without a licence. Officers of the

Corporation with suitable experience conducted

medium level flights in districts recognised for

growing potatoes.

PAGE 18

The past 12 months proved to be an extremely positive year. Grower returns were substantiallyhigher than in previous years and supply was efficiently managed within the set target of 5% ofdomestic demand.

The Operations team worked consistently throughout the year maintaining focus on their coreresponsibilities of managing domestic market supply, legislative compliance and developing andcoordinating the export program.

Further develop local seed suppliers,fostering trust and improving profitabilityfor participants

Western Potatoes has a long standing relationship

with a number of local and interstate seed suppliers. A

range of specialised potato varieties such as Granola,

Desiree and Atlantic have been purchased from

existing seed suppliers to be used for domestic and

international seed export sales.

Due to the increase in the demand for certified seed,

Western Potatoes contracted several new seed growers

from the Manjimup and Pemberton districts. The seed

produced by these growers was of good quality with

all new growers able to achieve certified level seed

production in their first season.

Growers continued to accept the new innovative

production schemes for seed in 2002–2003. The

growing regions of Busselton, Pemberton and

Esperance produced commercial seed for the second

season, while increasing their production areas to

meet market demand.

Continue to develop the technical ability ofthe operations team through new andimproved technology and methodology

Improvements to the operations department are

ongoing with the computerisation of the weighbridge

facility. This allows data to be captured as it occurs

creating more relevant reports.

The position of Supply Management Officer was filled

in December 2002. The primary responsibility of this

position is to manage production Pools and ensure

that supply is consistent and that stocktakes are

carried out in an accurate and timely manner.

Maintain existing international seedcustomers and further foster existingrelationships

Relationships with existing national and international

seed customers were maintained. Overseas visits were

undertaken during the year to further foster these

relationships. These visits included the Agricultural

Marketing Board in Mauritius to observe growing

crops planted from seed supplied by the Corporation

and Sri Lanka to determine new customer

requirements.

A section dedicated to the export seed program has

been added to the Western Potatoes website to inform

prospective customers of our activities. This page

details the experience behind the seed marketing

business and the varieties available to potential

customers.


PAGE 19

Operat ions (cont . )

Operat ions (cont . )

PAGE 20

Continue to expand the international exportseed market by focusing on new markets inSouth East Asia

Attention was also placed on expanding the

international seed business with new relationships

developed with customers in Sri Lanka. The Chief

Executive Officer and Chairman of Western Potatoes

were joined by the Director General of the Western

Australian Department of Agriculture, Dr Graeme

Robertson on a visit to Sri Lanka during the year. One

particular Sri Lankan company, CIC Ltd, has shown

interest in developing a solid relationship with a

supplier of good quality potato seed. They have a

distributor network throughout the country that will

be able to supply potato growers directly. Western

Potatoes has received orders from CIC Ltd for 800

tonnes of seed with the potential of another 1000

tonnes if they are able to demonstrate adequate

returns in new farming areas.

Continue to develop confidence in suppliersthrough sound management practices,while striving for equitable return for allparticipants in the supply chain

In 2002–2003 supply management was well balanced

due to production rationalisation and the reduced

volume of potatoes being exported to Western

Australia by other states. The rationalised volumes

resulted in better than average returns to growers in

all Pools.

The cool storage program initiated for the domestic

ware market in 2001–2002 continued with

approximately 1500 tonnes of potatoes placed into

medium term storage. The returns to growers from the

cool stored product was not as good as expected due

to the market requirement for clean white skinned

potatoes and lack of industry support for the program.

Encourage the adoption of modernmanufacturing methods by thewashpacking sector

Post harvest spoilage is a major problem in fresh

washed potatoes. Washpackers are actively

encouraged to use clean sanitised wash water and to

maintain a standard of cleanliness in their packing

facilities. The stock control practice of first in, first out

is also promoted to washpackers to ensure that

consumers receive the freshest possible potatoes, free

of sprouting and other storage defects.

By audit request, the return to growers indicator has

been removed from the audited Performance Indicator

section of this report. For consistency the figures have

been included below as a reference.

2000-2001 2001-2002 2002-2003

$/T $/T $/T

Return to Growers 458.92 346.39 513.31


Among our key planned achievements over the next 12 months we

will:

■ Maintain adherence to the Marketing of Potatoes Act (1946) and

Regulations.

■ Manage the supply of potatoes to the domestic market in Western

Australia.

■ Maintain and further foster existing relationships with international

seed customers.

■ Effectively manage established relationships with seed suppliers to

ensure sufficient supply of high quality seed.

■ Upgrade the Western Potatoes weighbridge facility to allow for the

inception of real time data capture into the operational database.

Western Potatoes has shown leadership by assisting the potato industry to implement a food safetyand quality assurance system which shows due diligence in food safety and demonstrates toretailers and consumers our commitment to quality. Food safety and quality assurance remain a keyrequirement in today’s competitive market.

There was continued uptake of the SQF 2000CM Code by the potato industry in 2002–2003 with thepercentage of potatoes grown by SQF certified growers continuing to increase.

Maintain the chemical residue testingprogram

The chemical residue testing program is maintained toverify the chemical free status of potatoes, to meetretailer requirements for chemical residue testing andto support applications for special chemical use permits.

Potatoes from 64 growers were sampled and testedover the last 12 months. Results showed no chemicalresidues that exceeded the maximum residue limit. Onesample of potatoes exceeded the maximum permittedconcentration for cadmium with the grower notexpected to use that site again for growing potatoes.

Residue test results were used as part of the applicationfor a renewal of the special use permit for chlorpyrifos.

Conduct internal audits and annual HACCPPlan reviews for all SQF certified growers

A key component of the Western Potatoes SQF programis to conduct at least one internal audit of eachcertified business per year. The audit is undertaken toidentify levels of compliance to the system andopportunities for improvement, and maintains acommunication channel for quality and food safetyissues to be addressed.

During the past 12 months, 82 on-site internal auditsand HACCP Plan reviews were carried out by WesternPotatoes Quality Systems Officer. The audits identifiedopportunities for improvement in areas such asaccuracy of chemical records, product traceability forrecall purposes and availability of fertiliserspecifications and material safety data sheets forchemicals.


PAGE 21

Qual i ty Assurance

Industry Sector 1998–1999 1999–2000 2000–2001 2001–2002 2002–2003 Total

Ware grower 3 40 4 6 2 55Seed grower 2 9 2 0 1 14Washpacker 1 1 2 1 0 5Transporter 1 0 0 2 0 2Total 7 50 8 9 3 76

Total number of SQF certifications per year


Assist growers to achieve SQF 2000CM

certification with a target of 75% of warepotato production grown by SQF certifiedgrowers

During 2002–2003, two ware potato growers and one

seed potato grower achieved SQF 2000CM certification.

With some rationalisation of ware grower numbers

and increased production by SQF accredited growers,

75% of the total ware potato production came from

SQF certified growers.

Additionally, Western Potatoes successfully introduced

a $5 per tonne payment for SQF certified growers on 1

July 2002 to acknowledge the extra effort and costs

associated with maintaining SQF certification.

Assist SQF certified growers withintegration of environmental best practices

All documented procedures associated with potato

production have been reviewed and where applicable,

environmental impacts have been addressed.

Procedures for chemical and fertiliser application have

been modified to include controls for environmental

impacts.

One SQF certified potato grower is using his chemical

and fertiliser records to support his application to

Water and Rivers Commission for expansion of potato

production in an environmentally sensitive catchment.

Qual i ty Assurance (cont . )

Western Potatoes found that Erwinia counts on

washed potatoes need to average below 1,000 Colony

Forming Units per four potatoes to consistently

minimise the risk of breakdown of packaged potatoes.

Once this benchmark number was determined, it was

tested to see if it could be realistically achieved in a

commercial operation. Two washpacking operations

invested considerable time and money into re-

engineering their wash and sanitiser systems to

achieve the required Erwinia levels.

The study has enabled washpackers to have a greater

understanding of the importance of Erwinia bacterial

counts and the effect this has on breakdown of

washed potatoes. To further encourage this practice, a

simple test kit and procedure was developed to allow

washpackers to conduct their own in-house

monitoring of Erwinia counts and thereby monitor the

effectiveness of their sanitising systems. Then, where

appropriate, they can adjust the process to minimise

the risk of breakdown.

Support the development of a rapid methodfor DNA identification of potato varieties

Western Potatoes continued to work with a Perth

biotechnology company to develop a DNA database

for all locally grown potato varieties. During the year,

a method for extraction of potato DNA from tuber and

plant material was developed. A selection of 100

potato plants and tubers of various varieties and

generations are currently having DNA extracted and

analysed.

Identify opportunities to reduce thebreakdown of packaged potatoes

A study was completed by Western Potatoes to

identify areas of opportunity for washpackers to

reduce Erwinia bacterial counts on washed potatoes as

a means to reducing breakdown (soft rot) of packaged

potatoes. The study found that Erwinia levels on

unwashed potatoes directly off the farm varied

dramatically from farm to farm. This poses a challenge

to each washpacker to have a washing and sanitising

process that can cope with this variation.

PAGE 22

Using the recently developed Erwinia test kit, the

Western Potatoes Quality Systems Officer will continue

to work with washpackers to identify the most

effective sanitisers and washing systems and also

assist in staff training for the use of the test kit and

interpretation of results.


■ Continue to encourage and assist potato growers to achieve

and maintain SQF 2000CM certification with a target of 80% of

ware potato production grown by SQF certified growers.

■ Continue with integration of environmental best practices into

the SQF program.

■ Conduct annual internal audits of SQF systems and HACCP Plan

reviews for all SQF certified potato industry members.

■ Maintain the chemical residue testing program to verify

chemical free status of potatoes and to support applications for

special use permits.

■ Complete the development of a rapid method for DNA

identification of Western Potatoes preferred ware potato

varieties.

■ Continue working with washpackers to identify the most

effective sanitisers and washing systems to prevent breakdown

Erwinia Test Kit


Review of the Risk Management SystemReview

The Audit and Management Review Committee is

charged with the responsibility of monitoring the

ongoing risk management system. The Committee met

three times during the year to assess the business

practices of the Corporation and to determine any

potential risk and control needed to remove these

potential risks.

The comprehensive risk review undertaken by the

Committee during the year identified no significant

risks to the Corporation. The risk process matrix was

also streamlined allowing for quicker assessment of

any potential risk.

Documentation of Policies and Procedures

With the introduction of the State Records Act 2000,the process of documenting the Corporation’s policies

and procedures continued with the documenting,

archiving and destruction of records as outlined in the

Act. The completion of the requirements under the Act

and the documentation of the policies and procedures

will continue to be a major focus of the team in 2003-

2004.

A new Accounting Officer position was created during

the year to increase the effectiveness of the current

financial reporting system. Areas of focus include

managing export and stock accounting, preparation of

detailed Pool reconciliation statements, operational

invoicing, maintaining and monitoring debtor’s

accounts and assisting with annual account

preparation.


PAGE 23

Finance and Administ rat ion

The Finance and Administration team are dedicated to providing financial, corporate and humanresource services and information technology systems that support and contribute to theachievement of the Corporation’s key business objectives.

Specific objectives identified for completion by the Finance and Administration team during 2002-2003 are included below.

Undertake building and equipmentmaintenance to ensure continued provisionof a safe and healthy work environment

The health and safety of all employees and visitors to

Western Potatoes is the responsibility of the

Management team. In fulfilling this responsibility,

management has a duty to provide and maintain,

where practical, a working environment that is safe

and without risks to health.

Work continued on upgrading the site and buildings to

provide a safe and pleasant work environment for

employees and visitors alike. The storage facility for all

the marketing and promotional material located

outside of the main administration building was

improved with new lighting, shelving and security. The

driveway and footpath were re-surfaced and the

entrance to the Administration building was improved

with better security lighting and the addition of a

retaining garden wall.

Further restoration and site improvements works, such

as relocation of the weighbridge controls and further

roadwork repairs, are planned in 2003-2004.

Continue improvements and upgrading ofinformation technology

Western Potatoes constantly reviews our information

technology processes, hardware and software to

ensure that the latest relevant technology is utilised. A

new IT company was contracted during the year to

provide a fully maintained helpdesk and undertake any

maintenance and upgrades to the computer network.

The integration of the licensing and payment systems

proceeded during the year. The final full integration of

the systems is planned for 2003-2004.

Finance and Administ rat ion (cont . )

Freedom of Information

The Corporation did not receive any Freedom ofInformation (FOI) requests during the year. AFreedom of Information Statement detailingprocedures, contacts and access arrangementscan be obtained by contacting the Freedom ofInformation Coordinator who is appointed tohandle all FOI applications. If assistance isrequired in completing a request, theCoordinator can be contacted on:

Telephone: (08) 9335 8999Fax: (08) 9335 9945Email: [email protected]

Privacy Policy

An appointed Privacy Officer handles all requestsfor access to personal information andcomplaints. A copy of the Western PotatoesPrivacy Policy can be viewed on the WesternPotatoes website.

Waste Paper Recycling

Western Potatoes is committed to the recyclingof waste paper. Recycling stations are positionedat each employee’s work station and thecollected paper is forwarded to an approvedrecycler. In addition, all paper records destroyedduring the year are pulped and recycled.

Human Resources

Commitment to Customer Service

In order to be successful in any commercialenvironment, customer focus must be embracedby all sectors of the industry. Western Potatoes iscommitted to providing reliable, efficient andeffective service to all of its customers.Customers are treated professionally, courteouslyand with appropriate sensitivity. All enquires andcomplaints are recorded in the Corporation’sdatabase and are responded to in a timely

Corporate Services

Audits

The external audit of all financial records of thePotato Marketing Corporation is conducted bythe Office of the Auditor General.

The internal audit function is carried out by theaccounting firm Stanton Partners andencompasses the entire organisation. Theinternal audit focuses on working together withthe Audit and Management Review Committeeto continually improve the Corporation’sbusiness undertakings, and to provide reasonableassurance that activities are carried outeffectively and efficiently in accordance withsound business practices and all legalrequirements.

PAGE 24

manner. Annual research surveys are alsoundertaken incorporating customer perceptionsof the impact of the Corporation’s marketingprograms, public relations activities, productquality and choice.

Equal Employment Opportunity

Western Potatoes is committed to equality ofemployment and considers it the right of everyemployee to work in an environment thatmaximises and promotes job satisfaction. It is ourpolicy and intent to comply with all applicablestate and federal laws prohibiting employmentdiscrimination.

Western Potatoes’ policy and practices are basedon the premise that a person’s value isdetermined by character, loyalty, education,experience and performance. All qualifiedpersons are given equal employmentconsideration and those already employedcontinue to be assured of opportunities foradvancement according to their abilities.

Opportunity policies were monitored during theyear and no instances of harassment or impropertreatment were detected.

Staff Development

Management recognises Western Potatoes has acommitment to the development of itsemployees. Our strategies are to build a highlyskilled, professional and fair workplace with theability to adapt to changing business technologyand the environment.

Training requirements are identified through atraining plan that is based on the outcomes ofstaff performance appraisals. PerformanceAppraisals are conducted on a six-monthly basisfor all employees.

During the year Western Potatoes spent $9,403on training, with courses being undertaken in theareas of computer training, records management,report writing, export and management training.


PAGE 25

Finance and Administ rat ion (cont . )


Among our key planned achievements in the provision offinancial, corporate and human resource services over the next12 months we will focus on:

■ Completion of the documentation of policies and procedures.

■ Compliance with new international accounting standards.

■ Final full integration of the licensing and payment systems.

■ Review and amendments to the finance reporting system.

Code of Ethics

Western Potatoes complies with the WesternAustralian Public Sector Code of Ethics. Details ofthe code are made available to all employees ofthe Corporation.

Workers Compensation

Western Potatoes settled one ongoing workerscompensation claim and received one new claim,resulting in a total of 12 days being lost.

Grievance Procedure

Western Potatoes is focused on resolving allgrievances involving unfair and inequitabletreatment in the workplace in a fair, equitableand prompt manner. The grievance resolutionprocedure is made available to all employees.

Organisat iona l Structure

■ M e m b e rs o f t h e B o a rd

■ S t a f f

PAGE 26

During the year Mr John Saleeba’s term expired and he

was replaced by the Ministerial appointment of Mr

David Sash. We would like to thank Mr Saleeba for his

contribution.

The Board is responsible to the Minister for

Agriculture, Forestry and Fisheries, who appoints the

Chairman and three of the members to the Board. The

remaining two members are commercial potato

producers who are elected by the growers under the

Electoral Act 1907.

Upon commencement of their term, Board members

are given an induction manual that outlines the role

and responsibilities of the Board. When appointed to

the Board, members undertake a solemn obligation to

carry out their duties in a fair, open, honest and

accountable way to the benefit of the Corporation and

the community they serve.

The primary role of the Board is to:

■ set performance goals;

■ ensure corporate compliance and management

accountability;

■ endorse strategic plans;

■ approve operating budgets; and

■ ensure that the Corporation has the resources

necessary to achieve goals, monitor progress and

report on outcomes.

In carrying out its role, the Board is subject to the

provisions of the Statutory Corporations (Liability ofDirectors) Act 1996 and as such is careful to act

honestly, exercise reasonable care and diligence and

not make improper use of information or its position.

Mr Jim Murphy, Chairman

Mr Murphy has been a member of the Board since1993 and is currently serving his third term. MrMurphy was appointed to the role of Chairman in1999 and was reappointed to this position in February2003. Mr Murphy has held senior positions with TheSunday Times Newspaper, Boans and Ampol Petroleumand more recently as the Chairman and ManagingDirector of JMG Marketing (Aust) Pty Ltd. Mr Murphyis an acknowledged authority on relationshipmarketing and provides management and marketingconsultancy to a number of leading organisations inWestern Australia and Singapore.

Mr Murphy brings extensive knowledge and expertisein the area of marketing to his position as Chairman.His present term expires in February 2006.

Mr Geoffrey Hick

Mr Hick was first appointed to the Board in 1996 andthen re-appointed in 1999 and May 2002. He isChairman of Bentleys MRI Australia Pty Ltd and is theDirector – Management and Business Services for thefirm Bentleys MRI Perth Pty Ltd CharteredAccountants. Mr Hick has over 30 years of experiencein the accounting profession with expertise in a widerange of most business activities. Most recently he hasspecialised in business advisory, finance, propertydevelopment and management consultancy. Mr Hick isengaged on the boards and management committeesof several private companies.

Mr Hick’s present term expires in May 2005.

Mr John Saleeba

Mr Saleeba’s term on the Board expired in December2002 after a term of three years. Mr Saleeba holds aBachelor of Commerce and a Bachelor of Law degreefrom the University of Western Australia. He currentlyworks as a Consultant in the national legal firmClayton Utz, Lawyers. Mr Saleeba has served onvarious committees of the Law Society of WesternAustralia and is also Governor of the Lions EyeInstitute of Western Australia.


Jim Murphy

PAGE 27

Members of the Board

Geoffrey Hick

John Saleeba

The Board of the Potato Marketing Corporation of Western Australia consists of a Chairman and fivemembers who have relevant expertise in the areas of marketing, finance, law, hospitality andcommercial potato production.

Members of the Board (cont . )

Meeting Attendance and Fees

Fees for board members are determined by the

Minister of Agriculture on the recommendation of the

Public Sector Management office and paid monthly.

Board members are reimbursed if travel,

accommodation and motor vehicle expenses are

incurred while on official business.

Board meetings are held monthly on the third Friday

of each month. Twelve meetings were held during the

past year. Board member attendance to these

meetings was as follows:

Mr David Sash

Mr Sash was appointed to the Board for a three-year

term in January 2003. Mr Sash holds a Bachelor of

Arts and a Bachelor of Law degree and is a partner

with legal firm Jackson McDonald. He has extensive

experience in commercial and industrial litigation and

has provided advice in all aspects of employment and

industrial law including preparation of contracts of

employment, termination of employment and

implementation of strategic advice to mergers,

acquisitions and privatisation.

Mr Sash’s present term expires in January 2006.

Mrs Pauline Tew

Mrs Tew was appointed to the Board in February 1995

and re-appointed in 1998 and 2001. A hotel and

leisure financial specialist, Mrs Tew has local and

international expertise in all aspects of hotel

marketing and management. She has extensive

knowledge of changing food trends and specialises in

developing new food concepts for hotels, restaurants

and cafes.

Mrs Tew’s present term expires in February 2004.

Mr Tony Ryan

Mr Ryan was elected to the Board in 1991 and re-

elected for his fourth term in 2000. He has been a

major potato grower in the Pemberton district for over

30 years and is now producing beef and potatoes

together with his sons.

Mr Ryan’s present term expires in September 2003.

Mr Bert Russell

Mr Russell is a commercial producer of potatoes and

was elected to the Board in September 2001. Mr

Russell previously served on the Board from 1977 to

1989. He is also Senior Vice President and Trustee of

the Potato Growers Association of Western Australia,

Zone Chairman of the PGA Donnybrook, Seed Grower

member of the State Seed Advisory Committee, State

member of the Potato Producers Committee and

Chairman of Callanish Grazing Pty Ltd.

Mr Russell’s present term expires in September 2004.

PAGE 28

Name Meetings attended Fee ($)

Mr Jim Murphy 12 16,856

Mr Geoffrey Hick 9 8,427

Mr John Saleeba 6 4,214

Mrs Pauline Tew 8 8,427

Mr Tony Ryan 10 8,427

Mr Bert Russell 12 8,427

Mr David Sash 5 4,214

Interests in Contracts

Western Potatoes requires all board members and

senior officers to declare any interests in existing or

proposed contracts between the Corporation and

members or senior officers, firms of which members or

senior officers are members, or entities in which

members or senior officers have substantial interests.

At the date of reporting, no board member or senior

officer had any interests in contracts with Western

Potatoes.

Ministerial Directives

No ministerial directives were received during the

financial year.

David Sash

Pauline Tew

Tony Ryan

Bert Russell

The day to day operations of Western Potatoes are carried out by a unified team of staff who worktogether to fulfil the requirements of the Marketing of Potatoes Act (1946) and to achieve thecorporate objectives agreed with the Board.


PAGE 29

Staff

As at 30 June 2003, Western Potatoes had 17employees, consisting of:

■ 8 Fulltime

■ 5 contract

■ 3 casual

■ 1 vacant

Western Potatoes is committed to ensure that thetalents and resources of employees are utilised to thefull and that all employees receive fair and equitabletreatment.

ORGANISATIONAL CHART

MERCHANT & RETAIL INSPECTORSJohn Adams

John Donaldson

MARKETING OFFICERAnnmarie Harris

RETAIL LIASON OFFICERJohn Adams

MARKETING &BUSINESS DEVELOPMENT

MANAGERHelen Stevenson

CHIEF EXECUTIVE OFFICERChris Perrott

PERSONAL ASSISTANTHelen Daley

LICENCE & QUOTA/WEIGH-BRIDGE OFFICER

Del Hemphill

IT LIAISON OFFICER AND DATA ENTRY

Hilda Camenzuli

RECEPTIONISTVacant

SUPPLY MANAGEMENTOFFICER

Roger States

PRODUCT MOVEMENTSUPERVISOR

Denise Murray

OPERATIONSMANAGER

Brian Dickson

COMPLIANCE SUPERVISORLarry Hegarty

QUALITY SYSTEMS OFFICERNeil Graham

FINANCE EXECUTIVEStephen Blackburn

CREDIT CONTROLOFFICER

Sarah Dorling

ACCOUNTING OFFICERLlew Skelton

Corporate Governance

■ C o m p l i a n c e S t a t e m e n t

■ C o m p l i a n c e w i t h L e g i s l a t i o n

■ C o m p l i a n c e R e p o r t i n g R e q u i re m e n t s

PAGE 30

In the financial administration of the Potato Marketing Corporation of Western Australia we have complied with

the requirements of the Financial Administration and Audit Act (1985) and every other written law, and exercised

controls which provide reasonable assurance that the receipt and expenditure of moneys and the acquisition and

disposal of public property and incurring liabilities have been in accordance with legislative provisions.

At the date of signing we were not aware of any circumstances that would render the particulars in this

statement misleading or inaccurate. Under Section 31(1) of the Public Sector Management Act (1994), the

Corporation is required to report on the extent to which it has complied with public sector standards in human

resource management, the code of ethics and its code of conduct.

In the administration of the Potato Marketing Corporation of Western Australia, public sector standards in human

resource management, the code of ethics and its code of conduct have been complied with.

Procedures designed to ensure such compliance are in place and we are satisfied that the above statement is

correct.

In the past year, no requests have been made for review of any alleged breach of standards.

Jim Murphy Chris Perrott

CHAIRMAN PRINCIPAL ACCOUNTING OFFICER


PAGE 31

Compl iance Statement

Compl iance with Leg i s lat ion

The administration of the Potato Marketing Corporation of Western Australia is required to complywith a number of Commonwealth and State written laws. Details of the relevant laws are outlinedbelow.

Enabling Legislation

The Potato Marketing Corporation of Western Australia is established under the Marketing of Potatoes Act(1946) and its Amendments and is responsible to the Minister for Primary Industry. The Act and its Regulationsset out the functions of the Corporation and the framework within which it is to operate.

Legislation Administered

Marketing of Potatoes Act (1946) and its Amendments

Legislation Impacting on Activities

A New Tax System (Goods and Services Tax) Act 1999

Debits Tax Act 1990

Disability Services Act 1993

Equal Opportunity Act 1984

Financial Administration and Audit Act 1985

Financial Institutions Duty Act 1993

Freedom of Information Act 1992

Fringe Benefits Assessment Act 1986

Government Employees Superannuation Act 1987

Industrial Relations Act 1979

Industrial Relations Reform Act 1993

Library Board of Western Australia Act 1951

Minimum Conditions of Employment Act 1993

Occupational Health and Safety Welfare Act 1984

Public Sector Management Act 1994

Sales Tax Assessment Act 1992

Statutory Corporations (Liability of Directors) Act 1996

State Records Act 2000

Trade Practices Act 1974

Workers’ Compensation and Assistance Act 1981

Changes in Written Law

There were no changes in any written law that affected the Corporation during the financial year.

PAGE 32

Compliance with Public Sector Management Act Section 31(1)

1. In the administration of the Corporation, I have complied with the Public Sector Standards in Human

Resource Management, the Western Australian Public Sector Code of Ethics and our Code of Conduct.

2. I have put in place procedures designed to ensure such compliance and conducted appropriate internal

assessments to satisfy myself that the statement made in item 1 above is correct.

3. The applications made for breach of standards review and the corresponding outcomes for the reporting

period are:

Number lodged: nil

Number of breaches found, including details of multiple breaches per application: nil

Number still under review: nil

Chris PerrottCHIEF EXECUTIVE OFFICER

Electoral Act 1907

In compliance with section 175ZE of the Electoral Act 1907, the Corporation is required to report onexpenditure incurred during the financial year ended 30 June 2003 in relation to advertising agencies, marketresearch organisations, polling organisations, direct mail organisations and media advertising organisations.

The details of the report are as follows:

Advertising AgencyBowtell, Clarke & Yole $276,677

Market Research OrganisationMarket Equity $88,385

Media Advertising OrganisationMedia Decisions $467,885

Polling Organisation nil

Direct Mail Organisation nil

Total $832,947


PAGE 33

Compl iance Report ing Requi rements

Financ ia l Statements

For the Year Ended 30 June 2003

■ L e t t e r f ro m t h e A u d i t o r G e n e ra l

■ C e r t i f i c a t i o n o f F i n a n c i a l S t a t e m e n t s

■ S t a t e m e n t o f F i n a n c i a l Pe r f o r m a n c e

■ S t a t e m e n t o f F i n a n c i a l Po s i t i o n

■ S t a t e m e n t o f C a s h F l o w s

■ N o t e s t o t h e F i n a n c i a l S t a t e m e n t s 2 0 0 3

PAGE 34


PAGE 35

Cert i f icat ion of F inanc ia l Statements

The accompanying financial statements of the Potato Marketing Corporation of Western Australia and the

accompanying consolidated financial statements have been prepared in compliance with the provisions of the

Financial Administration and Audit Act (1985) from proper accounts and records to present fairly the financial

transactions for the financial year ending 30 June 2003 and the financial position as at 30 June 2003.

At the date of signing we are not aware of any circumstances that would render any particulars included in the

financial statements misleading or inaccurate.

C Perrott G Hick J Murphy

PRINCIPAL ACCOUNTING BOARD MEMBER BOARD CHAIRMAN

OFFICER

3 October 2003

PAGE 36

Note

Consolidated Parent2003 2002 2003 2002

REVENUERevenues from ordinary activities

Revenue from operating activitiesTrading Profit 2 3,698,599 2,814,445 3,687,009 2,806,100

Revenue from non-operating activitiesInterest revenue 39,533 21,213 39,157 21,068Other revenue from ordinary activities 3 112,744 265,702 112,744 282,342Total revenues from ordinary activities 3,850,876 3,101,360 3,838,910 3,109,510

Expenses from ordinary activitiesEmployee expenses 4 1,346,333 1,270,904 1,346,333 1,270,904Supplies and services 5 1,535,407 1,702,063 1,536,410 1,706,289Depreciation and amortisation expense 6 40,476 48,353 40,476 48,353Borrowing costs expense 7 1 817 0 810Administration expenses 8 368,789 284,826 368,789 284,826Accommodation expenses 9 115,933 58,293 115,933 58,293Other expenses from ordinary activities 10 93,159 52,271 93,159 52,271Total expenses from ordinary activities 3,500,098 3,417,527 3,501,100 3,421,746

NET PROFIT/(LOSS) 350,778 (316,167) 337,810 (312,236)

Total changes in equity other thanthose resulting from transactionswith WA State Government as owners 350,778 (316,167) 337,810 (312,236)

The Statement of Financial Performance should be read in conjunction with the accompanying notes.


PAGE 37

Statement of F inanc ia l Performance

for the year ended 30 June 2003

Statement of F inanc ia l Pos i t ion


Note


Current AssetsCash assets 20 (a) 1,545,948 563,008 1,535,931 554,504Inventories 11 520,919 0 520,919 0Receivables 12 2,218,119 2,380,035 2,219,201 2,392,440Prepayments 23,283 32,724 23,283 32,724Loan 13 0 0 54,494 54,494Total Current Assets 4,308,269 2,975,767 4,353,828 3,034,162

Non-current AssetsProperty plant and equipment 14 856,548 877,740 856,548 877,740Intangible assets 15 8,722 11,629 8,722 11,629Total Non-current Assets 865,270 889,369 865,270 889,369

Total Assets 5,173,539 3,865,136 5,219,098 3,923,531

Current LiabilitiesPayables 16 158,595 278,361 158,595 278,329Provisions 17 92,801 104,891 92,801 104,891Other liabilities 18 2,906,325 1,842,606 2,906,325 1,842,606Total Current Liabilities 3,157,721 2,225,858 3,157,721 2,225,826

Non-current LiabilitiesProvisions 17 69,582 43,720 69,582 43,720Total Non-current Liabilities 69,582 43,720 69,582 43,720

Total Liabilities 3,227,303 2,269,578 3,227,303 2,269,546

NET ASSETS 1,946,236 1,595,558 1,991,795 1,653,985

Equity 19Reserve fund 1,215,673 864,995 1,261,232 923,422Land reserve fund 710,000 710,000 710,000 710,000General reserve 20,563 20,563 20,563 20,563

TOTAL EQUITY 1,946,236 1,595,558 1,991,795 1,653,985

The Statement of Financial Position should be read in conjunction with the accompanying notes.

PAGE 38

Note


CASH FLOWS FROM OPERATING ACTIVITIES

ReceiptsSales of goods and services 30,166,783 25,942,079 30,124,425 25,905,262Interest received 39,383 21,213 39,007 21,068GST receipts on sales 32,174 32,776 28,340 29,969GST receipts from taxation authority 231,525 249,190 231,030 248,953Other operating receipts 55,744 182,384 55,744 184,325

PaymentsEmployee costs (1,137,322) (1,151,175) (1,137,322) (1,151,175)Supplies and services (3,771,255) (3,681,860) (3,729,639) (3,653,375)Borrowing costs (1) (817) 0 (810)GST payments on purchases (309,060) (300,010) (307,170) (298,243)GST payments to taxation authority (15,919) (1,245) (13,877) 0Payments to growers (24,292,734) (21,275,530) (24,292,734) (21,277,471)

Net cash provided by operating activities 20 (b) 999,318 17,005 997,804 8,503

CASH FLOWS FROM INVESTING ACTIVITIESProceeds from sale of non-current physical assets 0 480 0 480Purchase of non-current physical assets (16,377) (16,453) (16,377) (16,453)

Net cash used in financing activities (16,377) (15,973) (16,377) (15,973)

Net increase/(decrease) in cash held 982,941 1,032 981,427 (7,470)Cash assets at the beginning of the financial year 563,008 561,976 554,504 561,974

Cash assets at the end of the financial year 20 (a) 1,545,949 563,008 1,535,931 554,504

The Statement of Cash Flows should be read in conjunction with the accompanying notes.


PAGE 39

Statement of Cashf lows


Notes to the F inanc ia l Statements


1. Significant Accounting Policies

The following accounting policies have been adopted in the preparation of the financial statements. Unless otherwise stated thesepolicies are consistent with those adopted in the previous year.

General Statement

The financial statements constitute a general purpose financial report which has been prepared in accordance with AustralianAccounting Standards, Statements of Accounting Concepts and other authoritative pronouncements of the Australian AccountingStandards Board, and Urgent Issues Group (UIG) Consensus Views as applied by the Treasurer’s Instructions. Several of these are modifiedby the Treasurer’s Instructions to vary application, disclosure, format and wording. The Financial Administration and Audit Act and theTreasurer’s Instructions are legislative provisions governing the preparation of financial statements and take precedence over AccountingStandards, Statements of Accounting Concepts and other authoritative pronouncements of the Australian Accounting Standards Board,and UIG Consensus Views. The modifications are intended to fulfil the requirements of general application to the public sector, togetherwith the need for greater disclosure and also to satisfy accountability requirements.

If any such modification has a material or significant effect upon the reported results, details of that modification and, where practicable, theresulting financial effect is disclosed in individual notes to these financial statements.

Basis of Accounting

The financial statements have been prepared on the accrual basis of accounting using the historical cost convention, except that certainassets and liabilities which, as noted, are measured at fair value.

(a) Principle of Consolidation

The consolidated financial statements have been prepared by combining the financial statements of the entities that comprise theconsolidated entity, being the Corporation (the parent entity) and its controlled entity as defined in AAS24 Consolidated FinancialReports. The controlled entity appears in note 21. Consistent accounting policies have been employed in the preparation and presentationof the consolidated financial statements.

The consolidated financial statements include the information and results of the controlled entity from the date on which theCorporation obtains control until such time as the Corporation ceases to control the entity.

In preparing the consolidated financial statements, all inter-entity balances and transactions and unrealised profits arising within theconsolidated entity are eliminated in full.

(b) Revenue Recognition

Revenue from the sale of goods and disposal of other assets and the rendering of services is recognised when the Corporation has passedcontrol of the goods or other assets or delivery of the service to the customer.

(c) Acquisitions of Assets

The cost method of accounting is used for all acquisitions of assets. Cost is measured as the fair value of the assets given up or liabilitiesundertaken at the date of acquisition plus incidental costs directly attributable to the acquisition.

Assets acquired at no cost or for nominal consideration are initially recognised at their fair value at the date of acquisition.

(d) Depreciation of Non-current Assets

All non-current assets having a limited useful life are systematically depreciated over their useful lives in a manner that reflects theconsumption of their economic benefits.

Depreciation is calculated on the straight line basis, using rates which are reviewed annually. Expected useful lives for each class ofdepreciable asset are:

Buildings 20 yearsPlant and equipment 5 yearsFurniture and fittings 10 yearsOffice and field equipment 5 to 10 yearsComputer equipment 2 yearsIntangible assets 5 years

PAGE 40

(e) Revaluation of Land and Buildings

The Corporation has a policy of valuing land and buildings at fair value. Valuations are undertaken every three years. Land was valued bythe Valuer General in 2001 when it was first transferred to the Corporation from Agriculture WA.

(f) Leases

The Corporation has entered into a number of operating lease arrangements for motor vehicles, office and computer equipment wherethe lessor effectively retains all the risks and benefits incident to ownership of the items held under the operating leases. Equalinstalments of the lease payments are charged to the Statement of Financial Performance over the lease term as this is representative ofthe pattern of benefits to be derived from the leased property.

(g) Cash

For the purpose of the Statement of Cash Flows, cash includes cash assets and restricted cash assets. These include short-term depositsthat are readily convertible to cash on hand and are subject to insignificant risk of changes in value.

(h) Inventories

Inventories held by the Corporation consist of potatoes and promotional items. Both inventory items are valued at the lower of cost andnet realisable value.

For promotional items, the weighted average method is used to assign costs whereas for potatoes the specific identification method isused.

(i) Receivables

Receivables are recognised at the amounts receivable, as they are due for settlement no more than 30 days from the date of recognition.

Collectability of receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off. A provision fordoubtful debts is raised where some doubts as to collection exists and in any event that the debt is more than 60 days overdue.

(j) Investments

Investments are brought to account at the lower of cost and recoverable amount.

Interest revenues are recognised as they are accrued.

(k) Intangible Assets

Intangible assets are valued at cost and they are amortised on a straight line basis over their estimated useful life.

(l) Payables

Payables, including accruals not yet billed, are recognised when the Corporation becomes obliged to make future payments as a result ofa purchase of assets or services. Payables are generally settled within 30 days.

(m) Interest-bearing Liabilities

Bank loans and other loans are recorded at an amount equal to the net proceeds received. Borrowing costs expense is recognised on anaccrual basis.

(n) Employee Benefits

Annual leave

This entitlement is recognised at the reporting date in respect to employees’ services up to that date and is measured at the nominalamounts expected to be paid when the liabilities are settled.

Long service leave

The liability for long service leave expected to be settled within 12 months of the reporting date is recognised in the provisions foremployee benefits, and is measured at the nominal amounts expected to be paid when the liability is settled. The liability for long service


PAGE 41





leave expected to be settled more than 12 months from the reporting date is recognised in the provisions for employee benefits and ismeasured at the present value of expected future payments to be made in respect of services provided by employees up to the reportingdate. Consideration is given, when assessing expected future payments, to the expected future wage and salary levels including relevanton costs, experience of employee departures and periods of service. Expected future payments are discounted using market yields at thereporting date on national government bonds with terms to maturity and currency that match, as closely as possible, the estimatedfuture cash outflows.

Superannuation

Contributions are made to superannuation funds, which exist to provide benefits for employees and their dependents on retirement,disability and death.

All staff who do not contribute to a superannuation fund become non-contributory members of the West State Superannuation Scheme,an accumulation fund complying with the Commonwealth Government’s Superannuation Guarantee (Administration) Act 1992. Thisscheme is administered by the Government Employees Superannuation Board (GESB).

The liabilities for superannuation charges under the Gold State Superannuation Scheme and West State Superannuation Scheme areextinguished by payment of employer contributions to the GESB.

The note disclosure required by paragraph 6.10 of AASB 1028 (being the employer’s share of the difference between employees’ accruedsuperannuation benefits and the attributable net market value of plan assets) has not been provided. State scheme deficiencies arerecognised by the state in its whole of government reporting. The GESB’s records are not structured to provide the information for theAuthority. Accordingly, deriving the information of the Authority is impractical under current arrangements, and thus any benefits thereofwould be exceeded by the cost of obtaining the information.

Employee benefit on-costs

Employee benefit on-costs, including payroll tax, are recognized and included in employee benefit liabilities and costs when the employeebenefits to which they relate are recognized as liabilities and expenses. See notes 4 and 17.

(o) Accrued Salaries

Accrued salaries (refer note 18) represent the amount due to staff but unpaid at the end of the financial year, as the end of the last payperiod for that financial year does not coincide with the end of the financial year. The Corporation considers the carrying amountapproximates net fair value.

(p) Foreign Currency Translation and Hedges

All export sales are denominated in Australian Dollars and as such there are no exchange rate exposures to the Corporation.

(q) Comparative Figures

Comparative figures are, where appropriate, reclassified so as to be comparable with the figures presented in the current financial year.

(r) Rounding of Amounts

Amounts in the financial statements have been rounded to the nearest dollar.

(s) Segment Information

Segment information is prepared in conformity with the accounting policies of the Corporation as disclosed in note 1 and the segmentreporting Accounting Standard AASB 1005 “Segment Reporting”.

Segment revenues, expenses, assets and liabilities are allocated on the basis of direct attribution and reasonable estimate of usage.Segment assets and liabilities do not include income taxes.

Segment information has been disclosed by output.

PAGE 42

2. Trading ProfitConsolidated Parent

2003 2002 2003 2002

Sales- Local 27,313,398 22,641,519 27,260,951 22,601,036- Export 2,666,745 2,302,425 2,666,745 2,302,425

29,980,143 24,943,944 29,927,696 24,903,461Costs of Sales- Purchase from growers (24,901,417) (20,814,223) (24,860,560) (20,782,085)- Export cost (1,349,902) (1,307,361) (1,349,902) (1,307,361)- Freight (30,225) (7,915) (30,225) (7,915)

Cost of Goods Sold (26,281,544) (22,129,499) (26,240,687) (22,097,361)

Trading Profit 3,698,599 2,814,445 3,687,009 2,806,100

3. Other Revenues From Ordinary Activities


Seed levy reimbursement 8,974 9,872 8,974 9,872Store rentals 57,000 41,500 57,000 41,500Agency fees/Minituber sales 46,770 214,330 46,770 230,970

112,744 265,702 112,744 282,342

4. Employee ExpensesConsolidated Parent

2003 2002 2003 2002

Wages and salaries 926,850 928,094 926,850 928,094Superannuation 98,825 95,381 98,825 95,381Annual and long service leave 91,022 117,649 91,022 117,649Other related expenses (i) 229,636 129,780 229,636 129,780

1,346,333 1,270,904 1,346,333 1,270,904

(i) These employee expenses include superannuation, payroll tax, workers compensation premium and other employment on-costs associatedwith the recognition of annual and long service leave liability. The related on-cost liability is included in employee benefit liability at note 17.

5. Supplies and ServicesConsolidated Parent

2003 2002 2003 2002

Consultants and contractors 267,111 316,611 269,438 311,295Materials 54,944 56,193 54,944 56,193Marketing 922,930 889,029 922,930 898,571Repairs and maintenance 30,986 12,300 30,986 12,300Travel 97,508 21,326 97,508 21,326Other 161,928 406,604 160,604 406,604

1,535,407 1,702,063 1,536,410 1,706,289


PAGE 43





6. Depreciation and Amortisation ExpenseConsolidated Parent

2003 2002 2003 2002

DepreciationPlant and machinery 5,747 7,184 5,747 7,184Buildings 3,647 3,647 3,647 3,647Office furniture and fittings 2,324 2,532 2,324 2,532Office and field equipment 4,616 4,864 4,616 4,864Computer equipment 21,235 27,219 21,235 27,219Total Depreciation 37,569 45,446 37,569 45,446

AmortisationIntangible asset 2,907 2,907 2,907 2,907Total Amortisation 2,907 2,907 2,907 2,907

40,476 48,353 40,476 48,353

7. Borrowing CostsConsolidated Parent

2003 2002 2003 2002

Interest paid 1 817 0 8101 817 0 810

8. Administration ExpensesConsolidated Parent

2003 2002 2003 2002

Communication 55,686 61,681 55,686 61,681Consumables 10,303 11,990 10,303 11,990Other staff costs 302,800 211,155 302,800 211,155

368,789 284,826 368,789 284,826

9. Accommodation ExpensesConsolidated Parent

2003 2002 2003 2002

Maintenance 97,947 40,675 97,947 40,675Cleaning 17,986 17,618 17,986 17,618

115,933 58,293 115,933 58,293

PAGE 44

10. Other expenses from ordinary activitiesConsolidated Parent

2003 2002 2003 2002

(a) Carrying amount of non-currentassets disposed of 0 70 0 70Levies 29,434 32,933 29,434 32,933Quality assurance program 19,282 19,268 19,282 19,268Stock obsolescence 44,443 0 44,443 0

93,159 52,271 93,159 52,271

(b) Loss on Sale of AssetsPentium computer 0 70 0 70Gross proceeds on disposal of asset 0 0 0 0Carrying amount of non-currentassets disposed of 0 70 0 70

11. InventoriesConsolidated Parent

2003 2002 2003 2002

CurrentInventories held for resale-potatoes at cost 557,291 0 557,291 0-provision for obsolescence (44,443) 0 (44,443) 0-promotional items at cost 8,071 0 8,071 0

520,919 0 520,919 0

12. ReceivablesConsolidated Parent

2003 2002 2003 2002

Trade debtors 2,692,057 2,456,090 2,692,741 2,452,424Provision for doubtful debts (490,236) (452,049) (490,236) (452,049)GST receivable 12,938 18,324 13,336 18,324Other debtors 3,360 357,670 3,360 373,741

2,218,119 2,380,035 2,219,201 2,392,440

13. LoanConsolidated Parent

2003 2002 2003 2002

Fresh Western 0 0 54,494 54,4940 0 54,494 54,494


PAGE 45





14. Property, Plant and EquipmentConsolidated Parent

2003 2002 2003 2002

Plant and machinery:At cost 76,800 76,800 76,800 76,800Accumulated depreciation (53,812) (48,065) (53,812) (48,065)

22,988 28,735 22,988 28,735

Furniture and fittings:At cost 42,757 42,757 42,757 42,757Accumulated depreciation (21,837) (19,512) (21,837) (19,512)

20,920 23,245 20,920 23,245

Office and field equipment:At cost 75,260 75,260 75,260 75,260Accumulated depreciation (49,538) (44,921) (49,538) (44,921)

25,722 30,339 25,722 30,339

Computer equipment:At cost 213,903 197,526 213,903 197,526Accumulated depreciation (185,131) (163,897) (185,131) (163,897)

28,772 33,629 28,772 33,629

Buildings:At cost 678,347 678,347 678,347 678,347Accumulated depreciation (630,201) (626,555) (630,201) (626,555)

48,146 51,792 48,146 51,792

Land:At fair value 710,000 710,000 710,000 710,000Accumulated depreciation 0 0 0 0

710,000 710,000 710,000 710,000

856,548 877,740 856,548 877,740

PAGE 46


PAGE 47



14. Property, Plant and Equipment (cont.)

ReconciliationsReconciliations of the carrying amounts of property, plant and equipment at the beginning and end of the current and previous financial yearare set out below.

Plant and Furniture Office and Computer Buildings Land TotalMachinery and fittings field equip. equip.

Consolidated - 2003Carrying amount at start of year 28,735 23,245 30,339 33,629 51,792 710000 877,740Additions 0 0 0 16,377 0 0 16,377Disposals 0 0 0 0 0 0 0Depreciation (5,747) (2,325) (4,617) (21,234) (3,646) 0 (37,569)Carrying amount at end of year 22,988 20,920 25,722 28,772 48,146 710,000 856,548

Plant and Furniture Office and Computer Buildings Land TotalMachinery and fittings field equip. equip.

Parent Entity - 2003Carrying amount at start of year 28,735 23,245 30,339 33,629 51,792 710000 877,740Additions 0 0 0 16,377 0 0 16,377Disposals 0 0 0 0 0 0 0Depreciation (5,747) (2,325) (4,617) (21,234) (3,646) 0 (37,569)Carrying amount at end of year 22,988 20,920 25,722 28,772 48,146 710,000 856,548

15. Intangible AssetsConsolidated Parent

2003 2002 2003 2002

Intellectual property 14,536 14,536 14,536 14,536At cost (5,814) (2,907) (5,814) (2,907)Accumulated amortisation 8,722 11,629 8,722 11,629

16. PayablesConsolidated Parent

2003 2002 2003 2002

Current:Trade payables 155,395 206,306 155,395 206,274Other creditors 3,200 72,055 3,200 72,055

158,595 278,361 158,595 278,329



PAGE 48

17. ProvisionsConsolidated Parent

2003 2002 2003 2002

CurrentAnnual leave 56,455 71,071 56,455 71,071Long service leave 36,346 33,820 36,346 33,820

92,801 104,891 92,801 104,891

Non-current:Long service leave 69,582 43,720 69,582 43,720

69,582 43,720 69,582 43,720

Employee EntitlementsThe aggregate employee entitlement liability recognised and included in the financial statements is as follows:

Provision for employee entitlementsCurrent 92,801 104,891 92,801 104,891Non-current 69,582 43,720 69,582 43,720

162,383 148,611 162,383 148,611

18. Other LiabilitiesConsolidated Parent

2003 2002 2003 2002

Payments due to 2002-2003 season growers 2,601,605 1,731,473 2,601,605 1,731,473Accrued expenses 241,872 88,137 241,872 88,137Accrued salaries 62,848 22,996 62,848 22,996

2,906,325 1,842,606 2,906,325 1,842,606

19. EquityEquity represents the residual interest in the net assets of the Corporation. The Corporation holds the equity interest on behalf of thegrowers.


(a) Reserve FundOpening balance 864,995 1,181,163 923,422 1,235,657(Prior Year Amendment) (12,977) 0 (12,877) 0Transfers from Pools 835,177 376,949 835,177 376,949Transfers to Pools (471,522) (693,117) (484,490) (689,184)

1,215,673 864,995 1,261,232 923,422

(b) Land Reserve FundOpening balance 710,000 710,000 710,000 710,000

710,000 710,000 710,000 710,000

(c) General ReserveOpening balance 20,563 20,563 20,563 20,563

20,563 20,563 20,563 20,563


PAGE 49



20. Reconciliation of Net Cash Provided by Operating Activities to Profit


(a) Reconciliation of CashCash at the end of the financial year in the Statement of Cash Flows is reconciled to the related items in the Statement of FinancialPosition as follows:Cash at bank 1,545,148 562,508 1,535,131 554,004Cash on hand 800 500 800 500

1,545,948 563,008 1,535,931 554,504

(b) Reconciliation of Profit/(Loss) from Ordinary Activities to Net Cash Flows Provided by/(used in) Operating Activities

Profit/(loss) from ordinary activities 350,778 (316,168) 337,810 (312,238)

Non-cash Items:Depreciation 40,476 48,353 40,476 48,353Doubtful debt expense 38,186 0 38,186 0Profit/(Loss) on sale of property, plantand equipment 0 (70) 0 (70)Stock obsolescence 44,443 0 44,443 0

(Increase)/decrease in assets:Current receivables 130,246 732,418 139,504 652,101Current inventories (557,291) 0 (557,291) 0Other current assets (8,071) (32,723) (8,071) (21,801)

Increase/(decrease) in liabilities:Current account payables 71,293 (245,407) 73,853 (245,439)Current provisions (12,090) 39,572 (12,090) 39,572Other liabilities 870,133 (197,932) 870,133 (197,932)Non-current provisions 25,862 (9,893) 25,862 (9,893)

Net GST receipts/(payments) 5,353 (1,145) 4,989 (1,140)Change in GST receivables/payables 0 0 0 56,990

Net cash provided byoperating activities 999,318 17,005 997,804 8,503

21. Investments in Controlled EntitiesName of Entity Country of Class of Entity’s Investment

Incorporation Shares 2003 2002 2003 2002% % $ $

Fresh Western Pty Ltd Australia Ordinary 100 100 2 2

The names of each person holding the position of Director in Fresh Western Pty Ltd are listed below. These individuals held the position of Board Members in the Corporation during the year.

Geoffrey HickJim MurphyHerbert RussellAnthony RyanJohn SaleebaDavid SashPauline Tew



PAGE 50

22. Explanatory Statement

22.1 Comparison of Actual Results with those of the Preceding Year

Details and reasons for significant variations between actual (income) and expenditure estimates for the corresponding item of thepreceding year are detailed below. Significant variations are considered to be those greater than 5% and exceeding $100,000.

2003 2002 Variance$ $ $

Sales Revenue - Local 27,260,951 22,601,036 4,659,915Sales Revenue - Export 2,666,745 2,302,425 364,320Purchases from Growers 24,860,560 20,782,085 4,078,475Supplies and services 1,536,410 1,706,289 169,879Other Income 112,744 282,342 169,598

Sales Revenue - LocalThe favourable result is due to a higher wholesale price achieved throughout the year.

Sales Revenue - ExportThe favourable result is due to increased export tonnage.

Purchases from GrowersThe increase return to growers is achieved as a result of the higher wholesale price achieved.

Supplies and ServicesThe decrease was achieved through revision of existing contracts and tighter controls over expenditure.

Other IncomeThe decrease is due to lower seed sales.

22.2 Comparison of Estimates and Actual Results

Details and reasons for significant variations between estimates and actual results are detailed below.Significant variations are considered to be those greater than 5% and exceeding $100,000.

Actual Budget Variance$ $ $

Sales Revenue - Local 27,260,951 23,470,882 3,790,069Sales Revenue - Export 2,666,745 1,488,329 1,178,416Export Costs 1,349,902 866,946 482,956Purchases from Growers 24,860,560 20,880,415 3,980,145

Sales Revenue - LocalThe favourable return was achieved due to a higher wholesale price achieved than was budgeted

Sales Revenue - ExportThe favourable result was due to increased tonnage exported.

Export CostsThe result is due to the higher tonnage exported.

Purchases from GrowersThe variance is a result of the higher wholesale price.


PAGE 51



23. Financial Instruments

(a) Interest Rate Risk ExposureThe following table details the Corporation’s exposure to interest rate risk as at the reporting date:

Weighted Average Variable Fixed Fixed Non-Interest TotalEffective Interest Rate Interest Rate Interest Rate Interest Rate Bearing

% $000 % $000 $000 $000

2003Financial assetsCash asset 4.1 1,467 3.8 69 1,536Receivables 2,219 2,219Loan 54 54

1,467 69 2,273 3,809

Financial liabilitiesPayables 0 0 158 158Outstanding payments to growers 0 0 2,906 2,906

0 0 3,064 3,064

2002Financial assets 3.8 554 2,446 3,000Financial liabilities 0 2,009 2,009

(b) Credit Risk ExposureThe Corporation’s maximum exposure to credit risk at balance date in relation to each class of recognised financial asset is the carrying amount of those assets as indicated in the statement of financial position.Credit risk in trade receivables is managed in the following ways:* Payment terms are 14 days, and* A risk assessment process is used for all customers.

(c) Net Fair ValuesThe carrying amount of financial assets and financial liabilities recorded in the financial statements are not materiallydifferent from their net fair values, determined in accordance with the accounting policies disclosed in note 1 to the financial statements.



PAGE 52

24. Remuneration of Members of the Accountable Authority and Senior Officers2003 2002

$ $Total fees, salaries and other benefits received in the financial year by:Board Members 89,068 78,011Senior Officers 417,302 405,159

Number of Board Members whose total fees, salaries, superanuation and other benefits fall within the following bands:$0 to $10,000 4 4$10,001 to $20,000 1 3$20,001 to $30,000 2 0

Number of Senior Officers other than Members of the Board, whose total fees, salaries, superanuation and other benefits fall withinthe following bands:$20,001 to $30,000 0 1$50,001 to $60,000 0 1$70,001 to $80,000 2 1$80,001 to $90,000 1 1$160,001 to $170,000 0 1$170,001 to $180,000 1 0

The superannuation included here represents the superannuation expenses incurred by the Corporation in respect of members of the Board and Senior Officers.No Members of the Board or Senior Officers are members of the Pension Scheme.

25. Remuneration of the Auditor

The total fees paid or due to the Auditor General for the financial year are as follows:2003 2002

$ $Audit fees 26,500 24,000

26,500 24,000

26. Supplementary financial Information2003 2002

$ $26.1 Revenue and Public and Other 0 1,703Property Written Off During the Financial Year

27. Segment (Output) Information

A table is contained on the following page

28. Non-cancellable operating lease commitments

Commitments for minimum lease payments are payable as follows:- not later than 1 year 156,732 134,972- later than 1 year but not later than 5 years 138,256 145,056


PAGE 53



27. Segment InformationThe potato growing season comprises of seven domestic Pool periods these are disclosed as our key output areas

POOL 1 POOL 2 POOL 3 POOL 4 POOL 5 POOL 6 POOL 7 TOTAL

2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $REVENUE

Revenues from ordinary activities

Revenue from operating activities

Trading Profit 492,568 355,486 186,759 75,919 299,528 378,978 369,875 346,000 873,223 632,135 861,477 628,070 603,579 640,481 3,687,009 3,057,069

Revenue from non-operating activities

Interest revenue 7,457 3,694 9,654 2,249 2,992 2,415 3,582 2,162 7,840 4,039 7,036 3,977 596 2,532 39,157 21,068

Other income 17,648 49,502 11,333 30,123 7,192 32,347 10,420 28,966 26,146 54,129 23,378 53,285 16,627 33,989 112,744 282,341

Total revenues from ordinary activities 517,673 408,682 207,746 108,291 309,712 413,740 383,877 377,128 907,209 690,303 891,891 685,332 620,802 677,002 3,838,910 3,360,478

EXPENSES

Expenses from ordinary activities

Employee expenses 256,396 222,866 135,333 135,605 102,860 145,633 123,163 130,407 269,563 243,696 241,923 239,896 217,095 217,231 1,346,333 1,335,334

Supplies and services 292,594 299,215 154,440 182,061 117,383 195,524 140,551 175,082 307,620 327,181 276,077 322,079 247,745 247,900 1,536,410 1,749,042

Depreciation and amortisation expense 7,708 8,479 4,069 5,159 3,092 5,541 3,703 4,962 8,104 9,272 7,273 9,127 6,527 6,531 40,476 49,071

Borrowing costs expense 0 142 0 86 0 93 0 83 0 155 0 153 0 0 0 712

Administration expenses 70,232 49,947 37,071 30,391 28,175 32,638 33,737 29,226 73,839 54,615 66,268 53,764 59,467 59,504 368,789 310,085

Accommodation expenses 22,078 10,222 11,654 6,220 8,857 6,680 10,606 5,981 23,212 11,178 20,832 11,003 18,694 18,706 115,933 69,990

Loss on sale of assets 0 12 0 7 0 8 0 7 0 13 0 13 0 0 0 60

Levies 5,605 5,775 2,959 3,514 2,249 3,774 2,693 3,379 5,893 6,315 5,289 6,215 4,746 4,749 29,434 33,721

Quality assurance program 3,672 3,379 1,938 2,056 1,473 2,208 1,764 1,977 3,861 3,695 3,465 3,637 3,109 3,111 19,282 20,063

Stock Obsolescence 0 0 0 0 0 0 0 0 0 0 32,007 0 12,436 0 44,443 0

Total costs of services 658,285 600,037 347,464 365,099 264,089 392,099 316,217 351,104 692,092 656,120 653,134 645,887 569,819 557,732 3,501,100 3,568,078

Net Profit/(Loss) (140,612) (191,355) (139,718) (256,808) 45,623 21,641 67,660 26,024 215,117 34,183 238,757 39,445 50,983 119,270 337,810 (207,600)

$ $

2003 2002

Unallocated Assets 5,219,098 3,923,530

Unallocated Liabilities 3,227,303 2,269,545

$ $

2003 2002

Acquisition of Property, Plant and Equipment 16,377 19,437

POOL 1 POOL 2 POOL 3 POOL 4 POOL 5 POOL 6 POOL 7 TOTAL

2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002 2003 2002

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

Non-cash expenses other than 2,623 5,203 1,384 3,167 1,052 3,401 1,260 3,045 2,757 5,692 2,475 5,603 2,222 3,567 13,773 29,678depreciation and amortisation

29. Contingent Liabilities and Contingent Assets

Contingent Liabilities: - The Authority is not aware of any contingent liabilities as at the financial reporting date.Contingent Assets: - The Authority is not aware of any contingent assets as at the financial reporting date.

30. Events Occurring after Reporting Date

There have been no significant events subsequent to the reporting date that would have any material effect upon the Authority and all operations containedtherein.

Performance Ind icators

■ L e t t e r f ro m t h e A u d i t o r G e n e ra l

■ C e r t i f i c a t i o n o f Pe r f o r m a n c e I n d i c a t o rs

■ Pe r f o r m a n c e I n d i c a t o rs

PAGE 54


PAGE 55

Cert i f icat ion of Performance Ind icators

We hereby certify that the performance indicators are based on proper records, are relevant and appropriate for

assisting users to assess the Potato Marketing Corporation of Western Australia, and fairly represent the

performance of the Potato Marketing Corporation of Western Australia for the year ended 30 June 2003.

J Murphy G Hick

CHAIRMAN MEMBER OF THE BOARD

19 September 2003

PAGE 56

The Potato Marketing Corporation of Western Australia’s primary outcome is outlined in the Marketing of PotatoesAct (1946) as being “…to control the production of potatoes in Western Australia through their marketing, sales

and disposal”.

Key Performance Indicators have been selected to demonstrate the extent to which the Corporation’s outputs

achieve the desired outcome outlined in the Act.

Management has set targets for the indicators, based on industry standards, market trends and requirements of

the Act.

1. Effectiveness Indicators

1.1 The extent to which the Corporation increased sales to the local ware (fresh potato) market via the orderly marketing system

2000–2001 2001–2002 2002–2003(%) (%) (%)

Increase in local ware market sales 6.0 1.6 (2.0)

The Corporation aims to increase local ware market sales by at least 1.5% over the previous season. Thisindicator allows the Corporation to ascertain the effectiveness of its marketing campaign and its supplymanagement.

The Corporation did not reach its target due to lower tonnage delivered and the continued realignment ofproduction to demand.

1.2 The extent to which the Corporation aligned domestic production more closely with localdemand

2000–2001 2001–2002 2002–2003(%) (%) (%)

Local ware market sales vs. deliveries 94.8 89.9 94.6

Through its supply management the Corporation aims to align its domestic production to approximately 95%of total production.

Of the total deliveries of ware potatoes 94.6% were sold to the local market. This was achieved as a result ofrealignment of production to meet the local demand.

2. Efficiency Indicators

2.1 Maintaining the Corporation’s costs at a reasonable level

2000–2001 2001–2002 2002–2003$/T $/T $/T

Corporation’s cost per tonne of potatoes sold 76.97 89.67 96.86

The increase in the Corporation’s costs is due to increases in maintenance of buildings and equipment andrising staffing costs.

2.2 Maintaining the cost of potato marketing at a reasonable level

2000–2001 2001–2002 2002–2003$/T $/T $/T

Marketing costs per tonne of potatoes sold 21.58 19.43 23.75

The increase in marketing costs is due to the Corporation’s restructuring of the Marketing department. Theactual cost of advertising was maintained at previous years’ levels.


PAGE 57

Performance Ind icators

Appendices

■ S t a t i s t i c a l I n f o r m a t i o n

■ A n n u a l E s t i m a t e s

■ L i s t o f P u b l i c a t i o n s

PAGE 58


PAGE 59

Stat i s t ica l Informat ion

0

50

100

150

200

250

300

Pool 7Pool 6Pool 5Pool 4Pool 3Pool 2Pool 1

HEC

TARE

S PL

ANTE

D

TOTAL HECTARES PLANTED BY POOL

POOL

196

245

213

109 106

154

244

0

10

20

30

40

50

60

Less OftenMonthlyFortnightlyWeekly or more

PERC

ENTA

GE O

F GR

OCE

RY S

HO

PPER

S

FREQUENCY OF PURCHASE

2001-2002

2002-2003

5

56 57

32

28

9 10

3

0

50

100

150

200

250

300

350

400

MyalupMetro/Gingin

Manjimup/Pemberton

DonnybrookBusseltonAlbany/Esperance

HEC

TARE

S P

LAN

TED

TOTAL HECTARES PLANTED BY DISTRICT

DISTRICT

229

87

343

42

367

199

0

10

20

30

40

50

60

70

RicePastaPotatoes

PERC

ENTA

GE O

F GR

OCE

RY S

HO

PPER

S

FOOD EATEN MOST OFTEN

2001-2002

2002-2003

19

59 58

19

23 22

0

5

10

15

20

25

30

35

40

45

50

MyalupMetro/Gingin

Manjimup/Pemberton

DonnybrookBusseltonAlbany/Esperance

PERC

ENTA

GE

TOTAL DELIVERIES BY DISTRICT

DISTRICT

2

26

3

41

11

18

0

10

20

30

40

50

60

70

80

90

100

2002-20032001-20022000-20011999-2000

PERC

ENTA

GE O

F GR

OCE

RY B

UYER

S

ADVERTISING RECALL

74

66

72

82

The Manjimup/Pemberton district planted the most hectares ofpotatoes closely followed by Busselton.

Most grocery shoppers purchase potatoes weekly or more often. Infact 88% of grocery shoppers purchase potatoes at least fortnightly.

Potatoes continue to be the food eaten most often whencompared to rice and pasta.

Although lower than in 2001-2002, advertising recallremains high at 74%.

The majority of deliveries were from the Manjimup/Pemberton district.

Annual Est imates

Operating Budget 2003–2004$’000

SalesLocal ware market 23,234Export 2,668

Sales Revenue 25,902

Less: Cost of Sales

Operating CostsExport costs 1,470Production Department 776Compliance 98Recruitment and training 3 2,347

Payments to Growers 20,630

Marketing CostsAdvertising 605Promotions 170Public relations 34Sponsorship 35Food service/catering 29Business development 95Marketing department 224Recruitment and training 6 1,198

Management CostsBoard expenses 94General administration expenses 1,262Recruitment and training 5 1,361

Trading Surplus 366

Add: Non Trading Income 152

Operating Surplus 518

Appropriation to Reserves 518

PAGE 60


PAGE 61

Annual Est imates

Statement of Financial Position for the 2003-2004 Budget$’000

Current AssetsCash assets 560Receivables 2,400Loan 49Total Current Assets 3,009

Non-current AssetsProperty, plant and equipment 855Intangible assets 5Total Non-current Assets 860

Total Assets 3,869Current Liabilities

Payables 250Provisions 100Other Liabilities 1,469Total Current Liabilities 1,819

Non-current LiabilitiesProvisions 50Total Non-current Liabilities 50

Total Liabilities 1,869

Net Assets 2,000

EquityRetained earnings 2,000

2,000

L i s t of Publ icat ions

Western Potatoes has produced the following publications. Copies can be obtained by contactingthe Corporation on (08) 9335 8999. Some of the following publications are also available in aprintable format on the Western Potatoes website at www.westernpotatoes.com.au

Annual Reports, 1971 through 2002

Chemicals Registered for use on Potatoes in Western Australia

Customer Service Charter

Freedom of Information Statement

Privacy Policy Statement

The Processes within a Wash Packer Operation

Key Facts of Western Potatoes 2002 Review Response (bookmark)

‘Marketing Update’ (issued monthly)

‘Our Growing Business’ Newsletter (issued quarterly)

Potato Facts Brochure

Potato Recipe Cards

Selection of Posters (used for promotional purposes)

Potato Variety Chart

PAGE 62

Potato Marketing Corporation of Western Australia 2003 · Marketing Corporation of Western Australia for the year ended ... Our long-term trading relationship with Mauritius ... Agricultural

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