Notes to and forming part of the financial statement for the period ended 30 June 2021 Overview Objectives of the Entity The Australian Human Rights Commission (the Commission) is an Australian Government controlled entity. It is a not-for-profit entity. The Commission’s objective is to ensure that Australians have access to independent human rights complaint handling and public inquiry processes and benefit from human rights education, promotion, monitoring and compliance activities. The Commission is structured to meet the following outcome: An Australian society in which human rights are respected, protected and promoted through independent investigation and resolution of complaints, education and research to promote and eliminate discrimination, and monitoring, and reporting on human rights. The continued existence of the entity in its present form and with its present programs is dependent on Government policy and on continuing funding by Parliament for the entity’s administration and programs. The Basis of Preparation The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance and Accountability Act 2013. The financial statements have been prepared in accordance with: a) Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR); and b) Australian Accounting Standards and Interpretations – Reduced Disclosure Requirements issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period. The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars. Going Concern Basis of Accounting The financial statements have been prepared on a going concern basis under the Australian Accounting Standards which assumes that AHRC will realise assets and settle liabilities in the ordinary course of business, and amounts have been recognised on this basis. The Commission is a national independent statutory body established under the Australian Human Rights Commission Act 1986. It would require legislative change to either cease or wind-up operations. The Commission made an operating loss of $4.726 million for the year ended 30 June 2021 (2019-20: loss of $5.774 million). As at 30 June 2021, the Commission has accumulated losses of $10.399 million (2019-20: $5.672 million), net liabilities of $5.436 million (201920: $2.525 million) and net current liabilities of $5.327 million (2019-20: $6.407 million). The balance of cash and equivalents as at 30 June 2021 was $3.356 million (2019-20: $2.575 million). The Commission has prepared cashflow forecasts which indicate that it will have insufficient cash to fund its operations for at least 12 months from the date of signing these financial statements without additional funding and support. The Attorney-General’s Department has committed to establishing a steering committee, in conjunction with AHRC and the Department of Finance, to support the development of options and the implementation of strategies to transition Commission to a sustainable financial footing. The committee will provide the Attorney-General’s Department with the basis upon which it will determine the amount and timing of funding it will allocate from its reserves in 2021-22 to support the transition. Annual Report 2020–2021 Australian Human Rights Commission 95