Gunns, FT and cash flow problems

Questions about Gunns'  and Forestry Tasmania's cash flow problems abound Charles(#9)asks

1. Forestry Tasmania FT has an increasing overdue credit portfolio, which has risen steadily over the years to $40 million?

Comment: This is essentially correct. FT’s trade receivables at 30th June 2010 were $38.5 million, after writing off $1.2 million worth of bad debts for the year. $6 million were GMO JV receivables, the balance related to its own receivables.

Flanagan L'Estrange exchange

It was pleasing to see Greg L’Estrange put pen to paper by replying (HERE) to Richard Flanagan (HERE) rather than rely on the bland response of his media department. It does enable a reader to pick up nuances that are otherwise lost.

It was a tad arrogant however to suggest as Greg did that Richard has a simple view of the world. A different view perhaps?

Greg's Chutzpah

He’s done it again.

This time in broad daylight.

Under the gaze of thousands of Gunns’ watchers, CEO Greg L’Estrange has once again manufactured a few book entries to help Gunns achieve a modicum of P&L respectability.

That boy certainly has chutzpah.

Bartlett's mess

It’s not uncommon for people from all walks of life to take credit for the favourable decisions and blame the rest on circumstances beyond their control.

Politicians are probably keener than most to take credit for the good stuff.

Forestry tasmania's cover up

Sue Neales was on the right track with her story titled $22m in forest funds sit idle (HERE)

The story regarding unspent funds received by Forestry Tasmania as part of the Tasmanian Community Forest Agreement TCFA was immediately rebutted by FT’s Hans Drielsma (HERE) who denied any hoarding of funds saying a prudent plan was in place to spend the remaining $22 million, a figure from internal FT spreadsheets obtained under RTI and referred to by Sue Neales.

But the truth is much worse, if one chooses to believe Mike Blake, the Auditor General. The TCFA future commitments far exceed the available cash on hand. There is an eerie resemblance between FT’s use of TCFA funds to operate and Mr Aird’s use of the SPA account to fund current Government programs.

Let’s start at the beginning.

Trust us

Simon’s plaintive cry suggested, inter alia, environmentalists are operating in “a knowledge vacuum” away from “the harder reality” of a true understanding of ecology and conservation.

Maybe but what’s worse is that forestry issues continue to be discussed in an economic vacuum away from the harder reality of dollars and cents. I’m not suggesting the latter should be the only criteria but to ignore them completely will lead to an unrealistic analysis and erroneous conclusions.

Simon laments that “professional foresters and conservation biologists have been largely disenfranchised”. Welcome to the Club.

Accountants and economists have likewise been largely ignored.

A state of delusion

Reading transcripts of Government Business Scrutiny Hearings can be boring.

But it can also be revealing. Sometimes it’s the questions. Other times the answers. Sometimes it’s the non answers.