2010-11 Annual Report - V/Line

ANNUAL REPORT
2010–11

Cover: Almost 10,000 passenger trips were made with V/Line to the UCI World Road Cycling Championships
in Geelong when they were held outside Europe for the first time in October 2010.

Contents
About us 02
Letter to the Minister 03
Key partnerships 04
Strategic agenda 05
Chairman’s report 06
CEO’s report 08
Passenger network map 11
Key results 12
Facts and figures 13
Safety and security 15
Our customers and communities 17
Sustainability and environment 21
Environment report 2010–11 22
Our people 26
Operations 28
Fleet 30
Infrastructure 31
Victorian rail network map 32
Financial summary 33
Corporate governance 34
Financial statements 39
Statement of corporate intent 70
Disclosure index 72
CONTENTS
1

About us
V/Line is Australia’s largest regional public transport
operator. In 2010–11 it served a record 14.7 million train
and coach passengers.
Each week there are more than 1400 train services that run
between Melbourne and:
• Geelong (including South Geelong and Marshall) and
Warrnambool
• Bacchus Marsh (including Melton), Ballarat, Ararat and
Maryborough
• Sunbury, Kyneton and Bendigo; Swan Hill and Echuca
• Seymour, Albury/Wodonga and Shepparton
• Traralgon, Sale and Bairnsdale.
There are also almost 600 coach services each week that
connect with the rail network and serve regional Victorian
communities where trains do not operate. Some coach
services also travel through to South Australia, New South
Wales and the Australian Capital Territory. These coaches
are run by private sector operators under contract from the
Department of Transport with V/Line providing day-to-day
contract management.
In addition to being a passenger service operator, V/Line is a
not-for-profit corporation under the State-Owned Enterprises
Act 1992. As part of this, it also provides access to, and
maintains, 3770 kilometres of broad gauge rail track used by
the passenger and freight rail services.
V/Line is a major employer with a workforce of 1448, many
of whom live in regional areas of Victoria.
ABOUT THIS ANNUAL REPORT
This is the annual report of V/Line Corporation – formerly
known as V/Line Passenger Corporation (VLC) – and its
wholly owned subsidiary V/Line Pty Ltd (V/Line) formerly
known as V/Line Passenger Pty Ltd.
As a franchisee, V/Line must fulfil its contractual obligations
under the franchise agreement with the Victorian
Department of Transport (Director of Public Transport).
V/Line is responsible to the Victorian Minister for Public
Transport and Victoria’s Treasurer.
This report provides a summary of V/Line’s key activities
and financial performance for the period 1 July 2010 to
30 June 2011.
VISION
Connecting Victorian communities and industry.
MISSION
To provide value for our customers and community by
delivering safe, reliable, accessible and sustainable
passenger and rail freight transport services.
VALUES
• Put our customers first
• Be honest
• Take responsibility
• Strive for excellence
• Treat people and the environment with respect,
with safety being paramount in all we do.
2
V/LINE ANNUAL REPORT 2010–11

Letter to the Minister
11 August 2011
The Hon Terry Mulder MP
Minister for Public Transport
Level 16, 121 Exhibition Street
Melbourne VIC 3000
The Hon Kim Wells MP
Treasurer
Level 4, 1 Treasury Place
East Melbourne VIC 3002
Dear Ministers
It is with pleasure that I present the annual report for V/Line Corporation and V/Line Pty Ltd (V/Line) covering the period
1 July 2010 to 30 June 2011.
The year has seen continued success for V/Line’s operations, with new highs in patronage as more and more Victorians,
both commuters and discretionary travellers, choose to use trains and coaches when travelling between regional destinations
and Melbourne. During 2010–11 there were more than 14.7 million passenger trips across V/Line’s rail and coach network,
up 6.9 per cent on the previous year and representing a doubling of V/Line’s customer base since 2004-05. Moreover, new
monthly patronage records were set for every month of 2010–11.
Together with the Department of Transport, the planning and initial works stages for the development of the Regional Rail
Link were completed. This is a watershed project for V/Line, which when finished will provide significant benefits for Geelong,
Ballarat and Bendigo passengers to and from Melbourne. This is a large and historic project, and one that will establish the
platform for V/Line’s future growth and success.
We also saw the partial return of V/Line’s passenger trains to and from Albury/Wodonga following the ARTC’s upgrade and
conversion to standard gauge of the north east corridor.
I would like to acknowledge and thank the State Government and particularly the Department of Transport for its continued,
strong support of V/Line and its vision of connecting Victorian communities and industry. Our trains and coaches have
undergone transformational change over the past six years. However, while much has been achieved, there is still much more
to be done. We look forward to working closely with the government, regional communities and our customers to forge the
next chapter in Victorian rail transport.
Yours faithfully
Frank Tait
Chairman
LETTER TO THE MINISTER
3

Key partnerships
To ensure our successful operation, V/Line partners with
a number of businesses and stakeholders.
• Assetco Management Pty Ltd – trading as
Southern Cross Station Pty Ltd (SCSPL), the manager
of Southern Cross Station
• Australian Rail Track Corporation (ARTC) – access
provider for the main interstate corridors. V/Line requires
access for the train service to Albury
• Bombardier – manufacturer and maintainer of our VLocity
train fleet and maintainer of our locomotive-hauled and
Sprinter fleets
• Councils – V/Line works with regional municipalities to
meet the transport needs of their communities
• Department of Transport (DOT)
– Public Transport Division (PTD): administers V/Line’s
franchise agreement, regional infrastructure lease,
subsidy payments, and V/Line branded coach contracts
– Transport Safety Victoria (TSV):
administers the rail safety accreditation system
– Freight, Logistics and Marine (FLAM):
administers government freight policy
• Essential Services Commission (ESC) – administers the
Victorian Rail Access Regime
• Independent Transport Safety and Reliability Regulator
(ITSRR) – administers rail safety regulation in New
South Wales. V/Line operates some broad gauge track
in southern New South Wales and also has services to
Albury/Wodonga
• Metlink/Viclink – provider of call centre and journey
planner, as well as an advocate for public transport
• Metro Trains Melbourne (Metro or MTM) – operator of
Melbourne’s suburban electric trains and access provider
to the metropolitan network
• Rail freight operators, including Pacific National
and El Zorro – users of the regional network
• Regional Rail Link Authority (RRLA) – V/Line is an
alliance partner in this major rail construction project in
Melbourne’s western suburbs
• Transport Ticketing Authority (TTA) – responsible for
developing the new myki smartcard for Victoria and
manager of V/Line’s ticket agents
• Victorian Managed Insurance Authority (VMIA) –
provides the majority of V/Line’s insurance requirements
• Victorian Government – the Minister for Public Transport
and the Treasurer
• VicRoads – major partner in our work to improve level
crossing safety as the authority for main roads
• VicTrack – owner of rail infrastructure, which is leased to
V/Line and other operators either via the Director of Public
Transport or directly
V/Line also partners with a wide range of suppliers who
deliver goods and services essential to its business.
Many of these are also based in regional Victoria.
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V/LINE ANNUAL REPORT 2010–11

Strategic agenda
V/LINE’S STRATEGIC AGENDA
V/LINE’S OBJECTIVES
SAFETY AND SECURITY
RETAIN AND GROW REPUTATION
SHAREHOLDER SATISFACTION
AND FINANCIAL RESPONSIBILITY
GROW THE BUSINESS
‘ON-TIME’ AND ‘IN-FULL’ SERVICE DELIVERY
CUSTOMER SATISFACTION
EMPLOYEE SATISFACTION AND WELLBEING
COMMUNITY AND ENVIRONMENTAL RESPONSIBILITY
Continuously improve safety and security in all
aspects of our operations and business.
Be trusted to advance and represent the interest
and prosperity of regional Victoria.
Be recognised by the government as demonstrating
strong governance, efficient operations and
financial responsibility.
Sustainably grow patronage and freight volumes
year-on-year.
Improve service delivery year-on-year.
Ensure that our reputation for excellent service contributes
to customer satisfaction levels that remain the highest
among Victorian transport operators and access managers.
Be recognised as an employer of choice in the Australian
rail industry, with a positively motivated, engaged and
skilled workforce.
Be a trusted representative of regional communities
on transport services that link the state and drives
sustainable outcomes.
STRATEGIC AGENDA
5

Chairman’s report
In V/Line’s first annual report in 2003–04, I reported on the
beginning of a new and exciting era for regional rail services
in Victoria.
Now, eight years on, V/Line is able to look back with
considerable pride and a great sense of achievement at a
period in which it has indeed been part of a transformation
of regional rail.
From the rebuilding of a large part of the network through the
Regional Fast Rail Project, to the introduction of 128 VLocity
train carriages, from the return of trains to Ararat, Bairnsdale
and Maryborough, to the doubling of patronage on our
passenger trains, this has been a period of sustained growth
and modernisation.
Delivery of the final two VLocity sets in the first half of
2011–12 will signal the successful completion of the first
phase of the emergence of the “new V/Line”. Importantly,
the next 12 months will herald the beginning of a new and
exciting phase that will deliver an even better regional rail
service for all Victorians.
Undoubtedly the most significant project will be Regional
Rail Link (RRL), with first construction taking place in July
2011 with realignment of tracks between Sunshine and
Tottenham to make way for the project’s new tracks.
The new tracks will allow trains from Geelong, Ballarat
and Bendigo to run into Melbourne on dedicated tracks,
delivering significant benefits to our customers. This will be a
significant step toward providing suburban-type rail services
to key regional centres.
The project includes the construction of 50 kilometres of
dedicated regional tracks from west of Werribee to Southern
Cross Station; the reconfiguring of Sunshine Station; new
platforms at Southern Cross; and the construction of two
new V/Line stations.
As an alliance partner in the project, we have been heavily
involved in the preliminary planning and will work closely
with other project participants to ensure V/Line’s operational
requirements are met.
RRL activity will steadily increase over the year and will
require disruptions from time to time to key V/Line regional
services. Our experience with similar coach replacement
programs during the Regional Fast Rail Project will help
ensure customer inconvenience is kept to a minimum.
2011–12 will also see the full return of V/Line services
to Wodonga as the North East Rail Revitalisation Project
is completed, along with the completion of the Sunbury
electrification project.
These large and complex state-backed projects will continue
to improve the rail services for all Victorians travelling to and
from the metropolitan area. Importantly, the new Victorian
Government, elected in November 2010, has committed to
significant studies that have the potential to lead to further
development of the regional network.
The government has allocated $3 million to begin planning
for a direct rail link to Avalon Airport, which provides
domestic air services for about 1.5 million passengers
a year.
V/Line will also participate in a government-initiated
investigation into the potential to revive passenger rail
connections between Geelong, Ballarat and Bendigo.
These are indeed exciting projects with the prospect to
continue and enhance the amazing growth and development
of regional rail services in Victoria.
6
V/LINE ANNUAL REPORT 2010–11

SOUND OPERATING PERFORMANCE
V/Line’s patronage levels continued their record-breaking
growth for the sixth consecutive year, with an increase of 6.9
per cent. In fact, there was a new monthly patronage record
set for every month of 2010–11, making for a remarkable
14.7 million passenger trips across V/Line’s network of
rail and coach services (13.7 million passenger trips in
2009–10).
At the same time, we have delivered a pleasing financial
outcome in a year that saw the completion of a number of
major construction and maintenance projects designed to
enhance our operations and customer service.
SUPPORTING THE COMMUNITY
V/Line plays a pivotal role in Victoria’s regional economy
and is committed to the regional communities it serves.
Ours was therefore an immediate and heartfelt response to
the devastation in northern Victoria caused by the severe
floods early in 2011. The Kerang area was the worst hit and
V/Line staff went quickly into action, not only in terms of
infrastructure repairs to restore services on the Bendigo-
Swan Hill line, parts of which were under water for two
weeks, but also in helping out affected communities in very
practical ways.
There were some outstanding individual performances and I
wish to commend our staff, particularly those on the ground
in flooded areas, for their dedication and resourcefulness
during this period.
Another support to regional communities is V/Line’s Life
Training program, which celebrated its fifth anniversary in
May. The program provides information to teenagers and
their families about important health topics and teaches
skills that will encourage correct choices in life. The program
was developed in partnership with the Victorian Country
Football League, with which V/Line has a long association.
Over the past five years, more than 10,000 young
participants have attended the program, which has been
held in more than 50 regional towns.
APPRECIATION
With the election of a new Victorian Government in
November 2010, V/Line welcomed Terry Mulder as
Minister for Public Transport. Minister Mulder has always
shown a deep interest in the development of regional rail
services and has already made a number of significant
announcements which will be important to V/Line’s future
operations. I wish to formally welcome Minister Mulder to
his role and wish him every success in over-seeing one of
Victoria’s most important and challenging portfolios.
2010–11 has seen a number of changes to the V/Line Board.
I would like to officially record my appreciation for the efforts
of retiring board members Fiona Bennett, Michael Tilley and
David Worth. I welcome new members Jack Diamond, Susan
Oliver and Moana Weir who have already made significant
contributions to the governance of the V/Line business.
V/Line’s ongoing record performance is related directly
to the outstanding performance of management and staff
across the organisation. On behalf of the board I thank
them for their efforts and look forward to their continuing
contribution in 2011–12.
Frank Tait
Chairman
CHAIRMAN’S REPORT
7

CEO’s report
In a year when the economy and forces of nature again
presented major challenges for the Victorian community
generally and its transport infrastructure in particular,
V/Line has successfully maintained its position as the fastest
growing railway operation in Australia.
From achieving new highs in patronage – which has more
than doubled in the past six years to 14.7 million passenger
trips on V/Line train and coach services – to successfully
managing major rail revitalisation projects and assisting
regional communities affected by the disastrous Victorian
floods of early 2011, V/Line has continued to build its
presence and performance across regional Victoria.
At the same time, we have delivered a pleasing financial
outcome in a year that saw the completion of a number of
major construction and maintenance projects designed to
enhance our operations and customer service. Of particular
note in our financial results is the further decrease achieved
this year in the subsidy per passenger trip, down to
$18.36, compared with $18.68 last year.
KEY INITIATIVES
During a year of significant activity, V/Line completed a
number of major initiatives that support the ongoing growth
and development of the state’s rail network. These include:
• Successful return of the Maryborough and Creswick
passenger services on 25 July 2010 after major track
and signalling work. Further improvements were also
undertaken to customer facilities – including construction
of a station platform at Creswick – and stabling yards to
support the services.
• Partial return of the Wodonga line services late in the
financial year after completion of the North East Rail
Revitalisation Project, which saw the upgrade and
conversion from broad gauge to standard gauge of
200 kilometres of track between Seymour and Albury
by the Australian Rail Track Corporation. Three V/Line
locomotives and three five-car sets of carriages have
been converted to standard gauge.
• Planning and initial works for development of the
Regional Rail Link project, which will eventually see up
to 50 kilometres of twin track from West Werribee to
Deer Park and then through to Southern Cross Station,
providing better connections between Melbourne and
Geelong, Ballarat and Bendigo.
• Start of construction of a new $16.5 million maintenance
facility at East Ballarat. This project will be completed late
in 2011, providing significantly improved maintenance
capability.
• Successful introduction of global transport company
Bombardier as the maintenance contractor for the
VLocity fleet and ‘classic’ fleet, which includes Sprinters,
locomotives and locomotive-hauled carriages. Bringing
the maintenance of all V/Line trains under the one banner
for the first time is already delivering significant cost
savings and operational efficiencies.
• Construction of new re-fuelling and stabling facilities at
East Ballarat and Geelong.
• Completion of a standard gauge maintenance facility and
new train wash at South Dynon.
• Major track work on the Geelong, Gippsland and
Warrnambool lines, involving the replacement of close to
100,000 timber sleepers.
• Initial deployment of a new Rail Operations Management
System, which is a new planning tool that will automate
the creation of timetables and crew rostering, thereby
leading to more efficient fleet deployment, maintenance
scheduling and fault management.
• Negotiation of a new franchise agreement with the
Department of Transport through to December 2012,
with the option to extend for a further 12 months.
SAFETY, SECURITY AND ENVIRONMENT
The safety and wellbeing of our passengers and staff, as
well as pedestrians and other road users, is our overriding
priority at all times. During the year V/Line continued to
implement a range of programs across the organisation to
reinforce this commitment and to enhance awareness and
vigilance regarding safe workplace practices.
I am pleased to report that for the third successive year,
there were no incidents involving road vehicles that
resulted in loss of life on regional Victorian level crossings
(excluding trespasser incidents) under V/Line’s control.
This positive outcome reflects the work of many people,
including our level crossing committee. The ongoing program
of level crossing upgrades continued, with completion of
improvements to 25 level crossings on the Maryborough
and Echuca rail corridors.
Internally, the lost time injury frequency rate (LTIFR) per
million hours worked increased from 14.5 in 2009–10 to
17.6 at 30 June. Safety improvement programs, particularly
in our operations area, have seen a range of measures
implemented, including modifications to locomotive rolling
stock and driver tasks. A safety review and development of
new action plans for the train crew department have been
designed to reduce the incidence of injuries.
Customer incidents within V/Line’s control – predominantly
slips, trips and falls – that required medical assistance
totalled 0.54 per million passenger journeys (compared with
0.48 in 2009–10).
8
V/LINE ANNUAL REPORT 2010–11

There was a significant 26 per cent reduction in the level of
incidents of anti-social behaviour, which is usually drug/
alcohol related, on board V/Line services as a direct result
of the Authorised Officer program.
V/Line has continued to improve its performance as
measured by the key safety indicator of the number of
Signals Passed at Danger (SPADs) by trains. V/Line has
maintained its record of having the lowest SPAD rate among
Australian rail operators and, indeed, one of the lowest in
the world. Incidents involving human error were at a rate
of 0.36 per million kilometres travelled (0.73 per million
kilometres in 2009–10).
A key element of V/Line’s approach to managing safety
is its risk management system. The enterprise-wide risk
management framework was further enhanced this year
via access to the UK’s Rail Safety Standards Board (RSSB)
model. The RSSB model helps V/Line to benchmark its risk
process, validate its risk assessments and prioritise areas for
investment to mitigate risk.
An example of where V/Line has effectively addressed risk
in its operating environment is the development of a severe
weather procedure. This initiative followed a train derailment
after hitting trees that had fallen across the track during a
storm at Stonyford last year. The new procedure provides
early warning and service modifications, where necessary,
in advance of severe weather conditions.
V/Line is also looking for the extension of the Train
Protection Warning System (TPWS), which already operates
on V/Line’s regional fast rail lines. TPWS is an electronic
safety system that provides an additional layer of security to
the network. In the event of a train driver exceeding a speed
instruction or failing to comply with a stop signal, the system
automatically slows or halts the train. The system is currently
being trialled with success on the metropolitan network.
A continuing priority for our environment team is the
management of vegetation growing along or beside rail
tracks. During the year good progress was made in this area,
aided by the creation in December of a new specialist role in
vegetation management within the team. The role focuses on
assisting V/Line’s infrastructure staff to do the works that are
necessary to keep the railway track safe, while also meeting
all environmental regulations.
OUR CUSTOMERS
V/Line’s patronage levels continued their record-breaking
growth for the sixth consecutive year, with an increase of
6.9 per cent. In fact, there was a new monthly patronage
record set for every month of 2010–11, making for a
remarkable 14.7 million passenger trips in total across
V/Line’s network of rail and coach services (13.7 million
passenger trips in 2009–10).
Meeting the needs of this large volume of passengers was
assisted by the deployment of eight new three-carriage
VLocity sets and a two-carriage set during the year, taking
the number of VLocity carriages in service to 128. A further
two three-carriage VLocity sets are scheduled for delivery in
2011–12 and their introduction will be not a moment too
soon, given the trajectory of customer levels.
A new timetable was introduced in May to help with
the increased passenger load and to improve on-time
performance. It includes two additional peak services on
the Geelong line, which remains the most heavily used in
V/Line’s network. The timetable, which provides a better
indication of actual travelling times and thus on-time
arrivals, has been well received by customers. Reflecting the
success of the new timetable, V/Line’s on-time performance
in June bettered previous results by a significant margin.
We have also worked hard in 2010–11 to improve
communication with our customers at times of service
disruptions. The V/Line Inform email and SMS message
services continue to evolve and we are exploring the
potential to utilise social media communication as a means
of providing even more up-to-date messaging.
Our freight network operations also experienced dramatic
growth, largely due to Victoria’s bumper grain harvest.
There was an increase in freight volume of nearly 400 per
cent in the 2010 calendar year compared with 2009
(2010 levels have been maintained in 2011).
CEO’S REPORT
9

DEVELOPING OUR ORGANISATION
As V/Line’s business continued to grow, significant steps
were taken to ensure that we have the organisation and the
resources required to meet the challenges of a modern and
progressive rail business.
Several departments – Finance, Infrastructure, Train
Crew, and Marketing and Stakeholder Relations – were
restructured during the year and we are already seeing
increases in efficiency and service delivery.
We have also established a dedicated project group to
oversee and co-ordinate the extensive range of government
projects under way or planned to begin in the near future.
Supporting our commitment to provide the best training
for our people, we are seeking Registered Training
Organisation (RTO) accreditation, which will enable
V/Line to deliver its own training, with a particular focus on
train crew and infrastructure (track maintenance, signals and
communications) training.
A new management development program has been
designed to identify and train high potential young
managers and graduates for promotion into middle and
senior management roles to support the continued growth
of the business.
Employees have embraced our Business Improvement
Program initiative, with more than 100 projects completed
across the organisation in the past year. With 100 facilitators
now trained in the Business Improvement Program, we
expect the number of projects to increase to 300 annually
in the years ahead.
FINANCIAL PERFORMANCE
Continuing growth in patronage on V/Line train and coach
services to new highs, coupled with the breaking of the
drought and consequent bountiful grain harvest resulting
in a dramatic increase in traffic on the freight network, have
contributed to a strong V/Line financial performance in
2010–11. Net surplus for the year was $17.9 million.
Total income for the V/Line business increased by
$38.2 million to $514.1 million, including a 7.3 per cent
increase (or $5.3 million) in farebox revenue to $77.5
million. Freight access revenue increased by $828,000
to $4.2 million.
In conclusion, I extend my thanks and appreciation to all
V/Line stakeholders, including the State Government
and the Department of Transport, for their support during
2010–11. I would also like to acknowledge and sincerely
thank the members of our board, particularly those members
who are retiring, for their invaluable contribution to V/Line
over recent years. And finally, to our staff, thank you for your
commitment and service to V/Line and its customers. The
ongoing success of the business is a testament to your hard
work and dedication.
Rob Barnett
Chief Executive Officer
10
V/LINE ANNUAL REPORT 2010–11

Passenger network map
Mildura
TO BENDIGO
TO SEYMOUR
TO BALLARAT
Sunbury
Craigieburn
Pinnaroo
Ouyen
Robinvale
Manangatang
Piangil
Griffith
Melton
TO GEELONG
Rockbank
Watergardens
Sunshine
Footscray
Newport
Werribee
Broadmeadows
Essendon
North Melbourne
Flinders Street
Richmond
Caulfield
Southern
Cross
Station
Clayton
MELBOURNE
METRO
Dandenong
Berwick
To Adelaide
Sea Lake
Swan Hill
Barham
Deniliquin
Finley
Pakenham
TO GIPPSLAND
Hopetoun
Kerang
Tocumwal
To Sydney
To Adelaide
Nhill
Dimboola
Warracknabeal
Horsham
Murtoa
Birchip
Rupanyup
Donald
Wedderburn
St Arnaud
Cohuna
Pyramid
Dunolly
Rochester
Elmore
Moama
Echuca
Bendigo
Stanhope
Mulwala
Barmah
Cobram
Nathalia
Yarrawonga
Numurkah
Kyabram
Shepparton
Murchison
East
Benalla
Corowa
Rutherglen
Albury
Wodonga
Springhurst
Wangaratta
Bright
Beechworth
To Canberra
Mt Beauty
To Adelaide
Casterton
Hamilton
Halls Gap
Glenthompson
Stawell
Ararat
Avoca
Maryborough
Creswick
Wendouree
Skipton
Ballarat
Castlemaine
Heathcote
Daylesford Kyneton
Lancefield
Woodend
Sunbury
Melton
Bacchus
Marsh
Seymour
Wallan
Yea
Whittlesea
Ringwood
Mansfield
Mt Buller
Maffra
Bairnsdale
Orbost
To Narooma &
Batemans Bay
To Canberra
Cann River
Mt Gambier
Portland
Heywood
Koroit
Port Fairy
Warrnambool
Mortlake
Port Campbell
Terang
Derrinallum
Camperdown
Colac
Geelong
Apollo Bay
Lorne
Werribee
Lara
Anglesea
Melbourne
(see inset)
Cowes
Dandenong
Cape
Paterson
Warragul
Lang Lang
Traralgon
Korumburra
Leongatha
Anderson
Wonthaggi
Inverloch
Sale
Yarram
Lakes Entrance
Train service
Coach service
PASSENGER NETWORK MAP
11

Key results
Change 2010–11 2009–10
Total customer trips (rail & coach) 6.9% 14,653,930 13,705,843
> Rail passenger trips 7.4% 13,494,142 12,561,850
> Coach passenger trips 1.3% 1,159,248 1,143,993
Tickets sold 5.5% 5,760,955 5,461,933
Farebox revenue 7.5% $77.5 million $72.2 million
Farebox (% breakdown) 4.3% 73% full fare 70% full fare
10% 27% concession 30% concession
Subsidy per passenger 1.7% $18.36 $18.68
Short-distance train services 2% 63,195 61,921
Long-distance train services 3.6% 10,793 10,421
Fleet:
> VLocity carriages 25.5% 128 102
> Locomotives – 41 41
> Loco-hauled carriages 3.6% 133 • 138
> Sprinters (single-unit) – 21 21
Stations 2.4% 84 82
Employees (total head count) 0.3% 1448 1444
• Five S-set carriages were retired after 60 years.
12
V/LINE ANNUAL REPORT 2010–11

Facts and figures
Customers Change 2010–11 2009–10
Customer satisfaction index (DOT target 68) – trains 73.4 74.5
Customer satisfaction index – coaches 76.4 75.4
No. of customer information enquiries 715,427 734,570
No. of customer feedback cases* 17,033 13,681
No. of on-train consultation sessions with customers 11 13
Compensation paid to customers for V/Line not meeting
on-time targets (complimentary ticket value) $191,814 $121,278
* Includes free travel.
Employees 2010–11 2009–10
Full-time equivalent staff 1433.2 1424.9
Total head count 1448 1444
Training attendance numbers 8201 4503
Training sessions 660 579
Finance 2010–11 2009–10
Total income $514.091 million $475.800 million
Total expenses $496.136 million $461.639 million
Income tax expenses $5.22 million $1.779 million
Net result $12.733 million $15.940 million
FACTS AND FIGURES
13

Facts and figures
Safety Change 2010–11 2009–10
All of V/Line lost-time injury (LTI) rate per million
hours worked (within V/Line’s control) 17.6 14.5
Customer incidents within V/Line’s control per
million passengers – requiring medical assistance 0.54 0.48
Signals passed at danger (SPADS per million km)
– human factor 0.36 0.73
Operations Change 2010–11 2009–10
Reliability overall (short & long-distance services, average
monthly performance) 98.9% 98.5%
Reliability – short-distance 98.7% 98.3%
Reliability – long-distance 98.7% 99.5%
Punctuality overall outside metro network (short & long-distance
services on time to 5 and 10 mins respectively, average monthly
performance)* 94.6% 95.6%
Punctuality – short-distance on time to 5 minutes 84.3% 84.9%
Punctuality – long-distance on time to 10 minutes 84.9% 87.0%
No. of services run – short-distance 63,195 61,921
No. of services run – long-distance 10,793 10,421
* No Albury services included.
14
V/LINE ANNUAL REPORT 2010–11

Safety and security
The safety and security of customers and staff is V/Line’s
number one priority at all times. The Safety, Security and
Environment group is dedicated to driving safety awareness
and safe working practices, and identifying and managing
risk at every level of the organisation. It is also responsible for
minimising operational impacts on the environment, as well
as sustainability and recycling performance.
MEASURES OF SAFETY
There are several statistical ways in which V/Line measures
its safety performance. They are:
• signals passed at danger by trains (SPAD), which reflects
rail network operational safety
• lost time injury frequency rate (LTIFR), which is an indicator
of staff safety
• number and severity of health and safety incidents
involving customers, which is an indicator of
passenger safety
• number of level crossing incidents (excluding trespasser
incidents) involving road vehicles with/without loss of
life, which is a further indicator of rail network operational
safety and also road users’ adherence to safety when
using rail crossings.
This year’s SPAD measurement - reflecting incidents involving
human error that resulted in train-to-train collisions - was
0.36 per million kilometres travelled, which represents a
50 per cent improvement compared with the rates of the
previous two years (0.73 in 2009–10; 0.72 in 2008–09).
V/Line has consistently achieved the lowest SPAD rate in
Australia, and indeed has one of the lowest in the world. This
year’s rate is an excellent result; however, it should be noted
that given V/Line’s very low baseline of SPAD incidents, one
more or one less incident in the course of a year can greatly
affect the year-on-year percentage changes.
The LTIFR result of 17.6 per million hours worked was an
increase on 2009–10 (14.5 per million hours worked).
Several programs within V/Line actively address areas of
heightened injury frequency. This year there was a particular
focus on mitigating soft tissue injuries among drivers by
looking at modifications to locomotive rolling stock and
driver tasks.
Customer OHS incidents within V/Line’s control that required
medical assistance was 0.54 incidents per million passenger
journeys (0.48 in 2009–10; 0.68 in 2008–09), with slips,
trips and falls accounting for the majority of these incidents.
To address customer incident risks, V/Line reviews each
incident in detail to establish its cause and then works
proactively to identify and remediate any similar conditions
that may exist elsewhere on the network. It should also
be noted that given the historically low rate of customer
incidents within V/Line’s control, any small increase or
decrease in the actual number of incidents from one year
to the next will show a significant difference in the rate per
million passenger journeys.
There were no level crossing incidents involving road
vehicles that resulted in loss of life during 2010–11.
Level crossings remain a major focus for safety awareness
and risk management. This year saw the development of
Level Crossing Safety Interface Agreements between road and
rail organisations across the state. The agreements set up a
process for the management of level crossing risks, as well
as agree maintenance responsibilities and establish specific
points of contact between road and rail organisations.
Ratification of the agreements is progressing well.
SAFETY AND SECURITY
15

SAFETY TRAINING
Safety training is a continuous activity at V/Line. Every
employee undergoes regular training and is constantly
reminded of the need for ‘safety first’ in everything they do.
A new safety DVD entitled ‘Be Safe, Make It Happen’ was
produced, featuring staff members talking about safety in
their roles. Launched during Safety Month in April, the DVD
highlights the importance of being safe at work and looking
out for each other. The involvement of actual staff members
gives the DVD particular impact and immediacy, and it has
been well received across the network.
V/Line’s commitment to safety and care for the environment
extends to its contractors and it is mandatory that every
contractor receive specific safety information and instruction
with the help of the enhanced contractor induction DVD.
Quarterly training with emergency service organisations –
both professional and volunteer – was again held during
2010–11. The program is designed to educate emergency
services staff about V/Line’s rolling stock, emergency
response procedures and other engineering information that
may be needed in the event of an emergency. It also helps
build strong relationships between the parties. Participants
this year included: Victoria Police, the State Emergency
Service, the Metropolitan Fire Brigade and the County Fire
Authority from various regions.
Simulated crisis training exercises were also held, in
particular the annual Terrorism Community Protection Act
compliance exercise, which was successfully undertaken
in November.
ENHANCING RISK MANAGEMENT PROCESSES
V/Line has a constant focus on identifying and mitigating
risks across the business. The Safety, Security and
Environment team drives this risk management process with
inputs from all other departments.
This year saw completion of the update to V/Line’s enterprise
wide risk management processes to meet the requirements of
the new international standard ISO31000. This achievement
ensures that V/Line continues to have a ‘best practice’
structure and appropriate procedures to address risk at all
levels of the organisation and its operation.
The integration of the Rail Safety Standards Board (RSSB)
safety risk model into V/Line’s own risk management system
continued throughout the year. Developed in the United
Kingdom, the model enables the Safety and Security team to
consolidate, validate and prioritise risks better by assessing
V/Line’s risk processes, particularly qualitative assessments,
against the quantitative data that the model provides. The
safety risk model will continue to be used in this manner
throughout the coming year.
ENHANCED SECURITY ON V/LINE SERVICES
The presence of Authorised Officers travelling on V/Line
services contributed to a reduction of 26.5 per cent
in the number of reported on-board incidents on V/Line
services this year (1767 incidents in 2010–11; 2405 in
2009–10). This is a significant result and indicates the
success of the Authorised Officers program, which was
introduced in early 2009. There are now 11 officers working
across the V/Line network. Deployed primarily for staff
and passenger security and safety, rather than revenue
protection, they concentrate on managing on-board
incidents, in particular anti-social behaviour.
CCTV monitoring is another way in which passenger and staff
security is enhanced. During the year, further progress was
made in upgrading CCTV facilities at seven stations across the
state. New CCTV installations were also undertaken at seven
stations, two stabling yards, four depots and two station car
parks for customer safety and asset protection.
16
V/LINE ANNUAL REPORT 2010–11

Our customers and communities
RECORD-BREAKING PATRONAGE – AGAIN!
It was another year of strong growth in patronage right
across the regional rail and coach network. More than
14.7 million passengers trips were taken (13.7 million in
2009–10), which represents growth of 6.9 per cent
(4.1 per cent in 2009–10), thereby making 2010–11
V/Line’s sixth consecutive record-breaking year.
Since 2004–05, when 7.25 million passenger trips were
recorded, patronage has more than doubled.
Train patronage grew by 7.4 per cent, or approximately
930,000 trips (4.2 per cent in 2009–10, or up just over
500,000 passenger trips), while coach patronage grew by
1.3 per cent, or more than 15,000 trips (2.2 per cent, or up
almost 25,000 trips in 2009–10).
All train lines experienced increases, with the Ballarat
line recording the largest – 10.0 per cent (5.1 per cent in
2009–10). Other lines had significant rises as well: Geelong
line +8.6 per cent (up almost 300,000 trips); Seymour line
+8.5 per cent (up more than 100,000 trips); Bendigo line
+6.7 per cent (up over 200,000 trips); and Gippsland line
+2.3 per cent (up more than 40,000 trips).
Farebox revenue grew by 7.3 per cent to $77.5 million
($72.2 million in 2009–10). Of this, 73 per cent represents
full fare revenue (70 per cent in 2009–10) and 27 per cent
represents concession revenue. The subsidy per passenger
again decreased to $18.36 ($18.68 in 2009–10).
Eight new three-carriage VLocity sets and a two-carriage set
were introduced during the year, taking the VLocity stable to
128 carriages. These new sets assisted greatly with the
increased demand on the network, as did the new timetable
that was launched in May. The timetable includes two
additional peak services on the Geelong line and also
provides more accurate on-time arrival information. The
new timetable helped V/Line achieve its best on-time
performance in June.
IMPROVED CUSTOMER COMMUNICATION
A ‘new look’ V/Line website was launched in December to
give customers easy access to information updates when
they need it. Features include improved navigation and
functionality, as well as a dedicated commuter section to
assist regular travellers, a single disruption notification tool
and an interactive map of Victoria to facilitate ticket sales,
station information and community events. General traffic
to V/Line’s website continues to grow, up by 21 per cent in
2010–11, and online ticket sales for the year increased by a
significant 77 per cent.
V/Line Inform email and SMS alerts continue to evolve.
They communicate updates to customers at times of service
disruptions. Work is also under way into using social
media communication as a further support to information
dissemination.
SEYMOUR TO ALBURY LINE REOPENS
Communities from Seymour to Albury welcomed the partial
return of V/Line services in late June after completion of the
ARTC’s $612.8 million upgrade to the track that started in
November 2008. The resumption of services coincided with
the opening of the new Wodonga Station. When works are
complete we will see three return V/Line train services and
two Country Link XPT train services per day from Melbourne
to Albury, providing a service for local communities and a
further support to local tourism and events in the
north east region.
PROMOTING REGIONAL TOURISM
As part of our commitment to developing Victoria’s regional
economy, we continued our support for major regional
festivals and events across the state. These included the
77th UCI Road World Cycling Championships in Geelong
in October; the 18th Castlemaine State Festival, which is
Victoria’s premier regional arts festival featuring music,
theatre, opera, art and dance, in April; and the Warrnambool
Races in May.
V/Line was the preferred mode of transport for many
people attending the UCI Road World Cycling Championships,
with special express services and more than 22,000 extra
seats added to normal train services over the weekend of
2-3 October.
OUR CUSTOMERS
17

In addition to the UCI championships, the 2-3 October
weekend coincided with the replay of the AFL Grand Final
and the Parklife music festival at the Myer Music Bowl in
Melbourne, making it one of the biggest for V/Line since the
Commonwealth Games in 2006. In total there were more
than 45,000 passenger trips over the weekend.
V/Line was principal sponsor of the biennial Castlemaine
State Festival this year, in particular its Precious Music in
Churches program, which featured recitals by chamber
ensembles from soloists to quintets and from classical to
new music. V/Line promoted the festival widely, in particular
to Melburnians and Bendigo line residents, encouraging
them to make the trip by train. Approximately 60,000 people
attended the 10-day festival, representing a 14 per cent
increase on 2009. They contributed almost $2.5 million to
the local economy. Train patronage was significant: overall
37 per cent of Melburnians who attended the festival
travelled there by train, including 50 per cent of first time
attendees from Melbourne; 12 per cent of visitors from other
regional areas also took the train.
We again supported the annual Warrnambool race week.
As in previous years, there was a special return service –
the Grand Annual Race Train – on the key race day, which
ensured that Melbourne and Geelong-based race goers
arrived at the racecourse in time for the first race and could
depart after the last. It was strongly promoted via the V/Line
website and customer newsletter, V/Line Voice.
Support was also provided to the Warrnambool Fun4Kids
festival in June, with promotion of the event and its
easy access by train from Melbourne, together with the
affordability of the Family Traveller ticket.
An initiative introduced this year to increase discretionary
travel in the off-peak was the online ‘Escape’ button.
This web button has grown in popularity for visitors wanting
to select random destination ideas in regional Victoria.
The ‘Escape’ button has helped facilitate a number of
additional tourism opportunities, including value added
discounts on presentation of a V/Line ticket.
BRINGING THE COUNTRY TO THE CITY
The number of passengers from regional communities
catching the train to Melbourne to attend sporting and
cultural events continued to grow during the year.
The 2011 Australian International Airshow drew large crowds
from across Victoria, with approximately 12,500 people
taking the train. This represented a 24 per cent increase
in V/Line airshow patronage, compared with 2009. V/Line
services operated from Melbourne and Geelong to Lara,
where a shuttle bus service linked directly to Avalon Airport.
Our footy trains were again very popular with AFL fans living
in regional areas, especially Geelong-based fans. More than
232,000 passenger trips were made on V/Line football trains
during the 2010 AFL season – an 8.1 per cent increase on
2009–10. Footy train patronage remained strong in the
first half of the 2011 season. Our football timetable email
database is proving popular. It involves AFL fans subscribing
to weekly footy train timetable updates, based on the team
that they support and the V/Line service that they use to
travel. The number of subscriber records on the database
increased by 88 per cent between July 2010 and May 2011.
There were two special campaigns to encourage regional
Victorians, especially families, to use public transport
to visit Melbourne – in particular to spend some time at
the Melbourne and Werribee Open Plains zoos, and the
Melbourne Aquarium. For the zoos campaign, V/Line teamed
with Metlink and Zoos Victoria for the first time and was
able to offer customers a 20 per cent discount on adult and
child entrance tickets at both zoos over the January holiday
period. A specially decorated ‘Noah’s art’ VLocity train,
regional television advertising and promotional activities at
Ballarat Station supported the campaign. Its success was
reflected in the record sales of our Family Traveller ticket in
January, with a 21 per cent increase on the previous year.
More than 1000 V/Line discount redemptions were received
by Zoos Victoria.
A similar partnership campaign was launched in June with
the Melbourne Aquarium. Again a 20 per cent reduction in
the entrance fee was offered to V/Line ticket holders. For
the first time a V/Line carriage was decorated externally
and internally to promote a destination. Highlighting the
aquarium’s newest resident, the Giant Pacific Octopus, the
carriage was seen across the network until August 2010.
SUPPORTING REGIONAL COMMUNITIES
V/Line plays a major role in Victorian regional communities,
as a service provider, employer and strong supporter of
local initiatives.
In 2010–11, V/Line entered a partnership with Keep
Australia Beautiful to support the “Stationeers” program in
which local community groups and residents join forces to
beautify their local train station. At 30 June there were 14
active “Stationeers” groups across the V/Line network.
We also supported the CFA Eastern Region during the year to
provide information to our customers on board trains on how
to minimise fire risk to their properties.
18
V/LINE ANNUAL REPORT 2010–11

V/Line staff were directly involved in supporting Ronald
McDonald House, the organisation whose Parkville
residence provides accommodation and other support for
families of children undergoing medical treatment at the
Royal Children’s Hospital. Our staff organised a collection of
gifts for 70 families staying at the house over the Christmas
period and also took part in a Christmas concert.
As Victoria experienced one of the most severe locust
plagues in 75 years in 2010–11, V/Line worked with local
communities and landowners across our 3700 kilometres
of railway reserve to minimise locust hatching locations and
our staff played a key role in reporting locust movement.
Our support of regional schools through the My Train
program reached record levels in 2010–11, with 67
schools travelling free on V/Line services as part of school
excursions. In conjunction with the Train Training program,
primary school students not only receive free travel but also
activity packs designed to provide education about safety
around trains and railway stations.
V/Line this year provided community groups, schools
and kindergartens with more than $44,000 in free travel
vouchers for fundraising events.
The V/Line State Titles netball competition celebrated its
25th year in October. More than 600 competitors from across
Victoria, as well as supporters, descended on Bendigo to
participate in a range of events including the presentation
of the V/Line State Distinction Awards, recognising the
contributions of volunteers to netball.
The V/Line Cup, elite under 15s competition for regional
boys, was held during April at grounds around Melbourne.
The competition is a recognised pathway for young boys in
their journey to the AFL. Our support of umpiring programs
continued through the V/Line Umpire Academies and Umpire
Development program.
We also continue to support the work of Travellers Aid by
providing travel for their emergency relief, indigenous and
pathways to education projects.
HELPING TEENAGERS TO MAKE THE RIGHT CHOICES
During 2010–11 we ran 23 Life Training sessions across
Victoria. We also introduced a new topic around body image
with our partner The Butterfly Foundation and continued
working with beyondblue and Odyssey House Victoria.
The program aims to encourage young people to make
correct choices in life by educating them about the dangers
of binge drinking, illicit drug use, depression and body
image. The successful program celebrated its 5th anniversary
in May. In partnership with the Victorian Country Football
League and Netball Victoria, the program has assisted
10,000 teenagers across more than 50 regional towns since
its inception.
SUPPORTING FLOODED COMMUNITIES
The record rains and flooding that occurred in northern
Victoria over the summer period severely affected many
communities and indeed isolated some for several weeks.
V/Line’s response to this crisis was immediate and
profound. While our Infrastructure teams worked tirelessly
on repairing tracks that had been inundated, local staff
quickly sought to lend a hand, helping families, assisting
the elderly and providing additional resources wherever
possible. Their Melbourne-based colleagues too lent their
support, including shaking collection tins at Southern
Cross Station.
CUSTOMER CONSULTATION AND FEEDBACK
V/Line’s senior management team continued its program
of customer consultation during the year, travelling every
month on peak train services to receive feedback direct from
travelling customers. Customers also provide feedback via
frontline staff and our call centre, which received 715,427
inquiries during 2010–11 (2.6 per cent fewer than the
previous year). This reduction reflects customers increasing
acceptance and use of online information services.
Consultation with community representatives is another
important source of feedback for V/Line. In 2010–11 we
conducted 44 presentations to regional municipal councils
and met with 15 regional Members of Parliament.
The value of compensation in the form of complimentary
tickets for customers affected when operational performance
targets were not met increased by 58 per cent in 2010–11
to $191,814. This increase was due mainly to an increase in
the number of planned and unplanned disruptions to normal
services during the year.
The Office of the Public Transport Ombudsman
independently reviewed 27 customer complaint cases
during the year, compared with 42 in 2009–10.
Customer satisfaction with V/Line performance remained
the highest of any Victorian public transport operator in
2010–11, with surveys conducted by the Department of
Transport scoring train services at 73.4 and coach
services at 76.0.
OUR CUSTOMERS
19

V/LINE TRAIN AND COACH C PASSENGER S E TRIPS
HAVE MORE THAN DOUBLED D IN SIX YEARS
04–05: 7.25 million
05–06: 7.64 million 5%
06–07: 9.72 million 27%
07–08: 11.96 million 23%
08–09: 13.17 million 10%
09–10: 13.71 million 4%
10–11: 14.65 million 6.9%
* Includes Department of Transport privately marketed coaches.
TRAIN PATRONAGE BY LINE:
geelong
86% over 5 years
bendigo
129% over 5 years
ballarat
126% over 5 years
gippsland
138% over 5 years
seymour †
26% over 5 years
05–06: 2.03 million*
05–06: 1.47 million*
05–06: 1.37 million*
05–06: 0.82 million*
05–06: 1.05 million
06–07: 2.57 million
06–07: 2.20 million
06–07: 1.88 million
06–07: 1.05 million
06–07: 1.15 million
07–08: 3.08 million
07–08: 2.78 million
07–08: 2.39 million
07–08: 1.54 million
07–08: 1.21 million
08–09: 3.38 million
08–09: 3.06 million
08–09: 2.68 million
08–09: 1.77 million
08–09: 1.17 million*
09–10: 3.47 million
09–10: 3.15 million
09–10: 2.82 million
09–10: 1.91 million
09–10: 1.22 million
10–11: 3.77 million 8.6%
>
10–11: 3.36 million 6.7%
>
10–11: 3.10 million 10.0%
>
10–11: 1.95 million 2.3%
>
10–11: 1.32 million 8.5%
>
* Periods of major track upgrade works
†
Craigieburn Station transferred to metro operator in 2008
and Albury line closed due to NERRPS works from Nov 2008
20
V/LINE ANNUAL REPORT 2010–11

Sustainability & environment
V/Line is committed to preserving and improving the
environment, especially along railway lines and in and
around our operational facilities, such as stations and
depots. Managing our activities so that their environmental
impact is minimal is a continuous and sometimes
challenging process. Our priority is on pollution and
vegetation management.
GOOD PROGRESS IN VEGETATION MANAGEMENT
V/Line continues to focus its environmental efforts on
better control and management of the vegetation along
its rail corridor and to work with neighbouring property
owners to reduce the potential for trees obscuring the
line-of-sight at level crossings or falling on the tracks.
We also work in consultation with local councils and the
Department of Sustainability and Environment to ensure
that trimming or removal of trees is appropriate and
undertaken safely. In March the appointment of a
specialist in vegetation management to the Environment
team further enhanced this work.
Another priority for the team is supporting the Infrastructure
group to ensure that track safety can be maintained while
all environmental requirements are respected. To help with
this, the team developed an environmental training program
for Infrastructure staff. Launched in April, it helps V/Line’s
infrastructure staff understand the environmental issues
likely to arise and identify what management measures are
to be implemented.
ENVIRONMENTAL MANAGEMENT
V/Line operates an extensive rail network that is supported
by fuel depots, stabling facilities, maintenance and
workshop sites. The Environment team works intensively
with these areas to help manage the environmental risks
associated with the handling of fuels and other potential
pollutants. While much has been achieved, there are still
challenges as evidenced by two pollution abatement notices
that were issued by the Environmental Protection Authority
in 2010–11.
V/Line is working to reduce spills, particularly from its
fuelling sites. During the year we appointed a new fuel
point maintenance contractor to ensure all necessary spill
controls at fuel points are in place and in working order. In
addition environmental training that is being delivered to
infrastructure staff includes aspects of pollution control
and management.
SUSTAINABILITY & ENVIRONMENT
21

Environment report 2010–11
V/Line’s environmental performance is guided by an
ISO14001 certified Environmental Management System.
Objectives, targets and an action plan have been
developed as part of this.
In line with Financial Reporting Directive 24C issued by
the Department of Treasury and Finance, V/Line monitors
and records its consumption of energy, water, paper and
transport, as well as its output of waste and greenhouse
gas emissions at its office-based operations.
The results for 2010–11 are below:
ENERGY
Within head office, V/Line uses electricity for lighting and
running office equipment. Energy used for heating and
cooling is not included in the information recorded here as
it is provided as part of the building tenancy and no
V/Line-specific data is available.
Indicator 2010–11 2009–10
Total electricity use (kWh) 306,600 285,096
Percentage of electricity
purchased as Green Power 15% 9%
Greenhouse gas emissions
associated with energy
use (t CO 2 -e) 351 321
Electricity use /
FTE (kWh/FTE) 1,952 1,949
% change in electricity
use / FTE
0.15% increase
INITIATIVES UNDERTAKEN
V/Line has taken the following actions at head office
to reduce the environmental impacts of its energy
consumption:
• Installing LED lighting within the two head
office boardrooms
• Trialling movement sensors on one head office floor
• Encouraging staff to adopt energy saving behaviours,
such as turning lights and computers off.
V/Line will focus on organisation-wide energy use in
2011–12 instead of setting a specific target for head office
energy use. The goal for 2011–12 is to maintain energy
use per passenger kilometre at or below the
2010–11 baseline.
COMMENTS ON DATA QUALITY
• The data is based on billing information provided by
the electricity retailer.
• Electricity use was estimated by extrapolating data
from available invoices.
• 2009–10 figure for electricity use per FTE has been
adjusted from last year’s report due to the availability
of better FTE data.
22
V/LINE ANNUAL REPORT 2010–11

WASTE
General kitchen and office wastes are produced within
V/Line’s head office. Two audits of waste generation
within head office were completed during 2010–11. They
estimated that employees disposed of 27 tonnes of waste,
which approximates to 175 kg/FTE for the year.
Waste to landfill
63%
Recycling
32%
Organic waste
5%
It is estimated that approximately 19 tonnes of
greenhouse gas emissions (t CO 2 -e) are released from the
disposal of head office waste to landfill each year.
INITIATIVES UNDERTAKEN
V/Line has undertaken the following actions at head office
to reduce the amount of waste it sends to landfill:
• Recycling bins are located on all floors.
• Organic waste bins are located on one floor.
• Staff are encouraged to reduce the amount of waste
produced and use correct recycling practices. This has
included the communication of waste audit results.
• Toner recycling is in place throughout the office.
COMMENTS ON DATA QUALITY
• The weight disposed of was estimated using
Sustainability Victoria’s volume to waste
conversions tool.
• Greenhouse gas emissions were estimated for waste to
landfill only using Federal Government emission factors.
PAPER
V/Line recognises that paper use is an important
environmental issue. During the year, paper use decreased
by 12.5 per cent within head office due to changes in staff
behaviour and initiatives aimed at reducing faxes.
Indicator 2010–11 2009–10
Total paper use (reams) 3,414 4,380
Paper use / FTE
(reams / FTE) 21 24
% change in paper use
/ FTE 12.5% decrease
Percentage of
paper purchased
with a recycled
content above
50% 96% 70%
ENVIRONMENT REPORT 2010–11
23

INITIATIVES UNDERTAKEN
We have taken the following actions at head office to
reduce the environmental impacts associated with
paper use.
• All white A4 office paper purchased is required to have
a recycled content of 50 per cent or above.
• Staff are encouraged to reduce printing (through the
use of email and document sharing) and print doublesided.
• A project by the Network Services team during the year
halved the number of faxes sent by the department by
changing to electronic processes.
• The Human Resources group implemented an ‘e-recruit’
process during 2010–11.
COMMENTS ON DATA QUALITY
• Paper consumption is reported as A4 reams (e.g. one
A3 ream equals two A4 reams).
WATER
Water is used at V/Line’s head offices for bathroom and
kitchen purposes, but as V/Line is a tenant in these
large office buildings, data on water consumption is not
available as individual floors are not metered.
The taps in V/Line’s head offices are fitted with flow
restrictors or aerators and toilets are dual flush. Staff are
encouraged to use the dishwashers available and report
water leaks.
V/Line has an objective to improve water efficiency at all
V/Line-controlled operations.
TRANSPORT
As a state-wide transport operator, V/Line requires its
staff to travel throughout Victoria. Staff are directed where
possible to use V/Line’s train services to attend regional
meetings, but a small car fleet is available to support
head office and regionally-based staff. In particular, track
maintenance staff require vehicles to do their work.
The following information on energy used by vehicles
covers all V/Line operations, not just head office.
Although V/Line has no available data on how staff
commute to work, it is estimated that the vast majority of
head office staff travel to work using public transport or by
cycling or walking.
Indicator 2010–11 2009–10
Energy Use (GJ)
Petrol 6,548 6,806
Diesel 54,266 52,013
LPG 34 31
Total 60,849 58,849
Greenhouse gas emissions
from vehicle fleet (t CO 2 -e) 4,251 4,111
Energy use (GJ)/FTE 61.4 60.9
24
V/LINE ANNUAL REPORT 2010–11

INITIATIVES UNDERTAKEN
In 2009–10 we worked to reduce the number of fleet
vehicles available. This year we completed a project that
undertook to identify low emission vehicles suitable for
use by V/Line. As a result there are now three hybrid
vehicles within our fleet with plans to include more low
emission vehicles as replacements are required.
GREENHOUSE GAS EMISSIONS
Greenhouse gas emissions associated with V/Line’s
head office operations have been reported in the energy,
waste and transport sections above. More comprehensive
information on V/Line’s energy use is available in the
Energy Efficiency Opportunities Program report (to be
made available on V/Line’s website).
Next year V/Line will be reviewing a computer program to
assist drivers to operate trains with greater emphasis on
fuel efficiency.
ENVIRONMENTAL ISSUES AND ACCIDENTS
NEW INCIDENTS
Environmental incidents that occurred during 2010–11:
• On 18 September 2010 there was a fuel spill at the
South Dynon fuel point. Of the 10,000 litres spilt
it is estimated that 1,500 litres escaped to ground.
V/Line engaged a contractor to respond to, and
clean up, the spill but has also received a Pollution
Abatement Notice (PAN) from the EPA. V/Line is
working through the requirements of this PAN to
improve controls at the site in order to reduce the
risk of future spills.
• On 22 June 2011 EPA officers inspected a work site
within the V/Line rail reserve where embankment
reinstatement works were being conducted. The EPA
determined that these works were causing pollution
offsite through the transfer of sediment onto the road
area. As a result of this, the EPA issued a PAN for the
site. V/Line has worked through the requirements of the
PAN to reduce the transfer of sediment off site.
ENVIRONMENTAL ISSUES
25

Our people
CONTINUOUSLY IMPROVING
A major focus for the Human Resources team in 2010–11
was the continuous improvement of our Human Resources
systems and processes. This involved the implementation
or enhancement of a number of IT initiatives, in particular
e-recruitment, which helps streamline the receipt and
assessment of job applications. This new tool assisted our
recruitment team to process more than 5000 applications
for the 210 positions that the Human Resources group were
required to fill during the year.
During the year 127 Business Improvement Program
initiatives were completed. Each V/Line manager has been
trained to facilitate business improvement teams. This
program provides a platform for enhancing staff satisfaction
through the involvement of continuous improvement
activities, thereby increasing cross-functional teamwork, as
well as embedding a consistent methodology for problem
solving across the business.
The implementation of an online performance review
system commenced in March 2011. This system will provide
approximately 200 staff with a link directly to their individual
goals and Key Performance Indicators (KPIs). The launch of
the medical module, which is part of the Human Resource
Information System was a notable achievement. The module
enhances the management and reporting of staff medical
health assessments that are associated with V/Line’s
compliance with the Rail Safety Act and its accreditation
requirements.
LEARNING AND DEVELOPMENT
Restructuring activities progressed in the area of learning
and development to better align V/Line’s programs with its
changing business needs. Safeworking and Shunter Training
were both brought in-house and a Competency Manager
– Safeworking was appointed to support this activity. This
was a further step in the overall strategy to transition several
important training and development programs from external
to internal management.
Key to this strategy is the establishment of V/Line as a
Registered Training Organisation (RTO). As reported last
year, the decision by International Transport Training and
Development (ITTD) to cease its driver training program in
Victoria prompted V/Line to take over this training activity,
using its own experienced staff as trainers. Under an auspice
agreement with Victoria University, V/Line’s Driver Training
now has 19 new internal driver trainees undergoing driver
training, together with a number of conversion trainees with
qualifications from other organisations.
Over the past year, V/Line established the governance
model, systems and processes necessary to support RTO
recognition and its application for formal accreditation for
driver training is currently before the Victorian Registration
and Qualifications Authority (VRQA). In tandem with this,
the position of RTO Manager was created within the Human
Resources team.
Significant progress was made in implementing the
Infrastructure Training Strategy and Framework. The
Infrastructure group has responsibility for track maintenance,
signals and communications. During 2010–11 a pilot
induction program of flexible learning for new Infrastructure
staff was developed. This is a six-month program that
enables new staff to complete a number of units of
competency from the Certificate II in Rail Infrastructure within
their probationary period. The model involves on-the-job
training, with V/Line supervisors delivering both the training
and assessment components.
To enhance our competence, training and awareness
framework, a Compliance Training Matrix was developed and
implemented. The matrix identifies job-specific, mandatory
training and also includes legislative requirements.
IDENTIFYING LEADERS OF THE FUTURE
Given the growth in V/Line’s business and its plans for the
future, it is vital to identify and develop potential leaders
within the organisation. As part of a ‘talent pool’ initiative,
a series of management skills programs was organised in
conjunction with the Melbourne Business School (Mt Eliza
Campus). Several staff members were also sponsored to
undertake the Graduate Diploma of Rail Operations and the
Masters of Rail Operations.
During the year, five staff members completed the
Management Development Program that resulted in them
being awarded a Diploma of Management from Swinburne
University. There were also 12 graduates from the Certificate
IV Training and Assessment at Victoria University. Two staff
members graduated with a Diploma of Railway Signalling
Systems from HRD Integrated Services and three with a
Graduate Diploma of Railway Signalling and Communications
from Central Queensland University.
V/Line continued to conduct its Leadership Program during
the year. This program focuses on the five leadership
behaviours that V/Line expects of someone in a leadership
role. The program not only promotes consistent leadership
behaviours, but also directly links to V/Line’s values,
business results and leadership competencies.
The Human Resources team also supported restructures
in the Infrastructure, Finance, Marketing & Stakeholder
Relations, and Safety Security & Environment groups to
create career development opportunities for staff and to
support succession planning.
26
V/LINE ANNUAL REPORT 2010–11

TRAINING ACROSS THE BUSINESS
The total number of training hours undertaken by V/Line
staff increased to just under 79,000 in 2010–11 (72,000
in 2009–10). This represents 54.48 training hours per
employee (49.95 hours in 2009–10).
ENTERPRISE AGREEMENT 2009-2012
V/Line continued to work closely with the Rail Tram and Bus
Union – Rail Operations and Locomotive Divisions. Good
progress was made in the implementation of the productivity
initiatives that are associated with the 2009–12 Enterprise
Agreement. Planning for 2012–15 Enterprise Agreements
has also commenced.
OTHER ACHIEVEMENTS
We achieved an ‘industry best’ Workcover Premium in
2010–11, which means that V/Line is recognised as having
set the benchmark standard for the industry in relation to
Workcover premiums. This has resulted in significant savings
in our 2011–12 premium.
We also received a 2010 Australasian Rail Association
Industry Award for Excellence for our Workers Compensation
Management Program.
The year marked significant service milestones for a number
of our staff. To recognise and thank these long-serving
employees, special presentations were held. In total, there
were 22 staff members celebrating 40 years of service and
21 members reaching 30 years of service. We would like
to acknowledge their significant contribution to V/Line’s
success over these periods.
EMPLOYEE SNAPSHOT
V/Line’s staff complement increased by four during the year.
At 30 June 2011, the total staff headcount was 1448
(1444 in 2009–10), with a total FTE of 1433.2 (1424.9
in 2009–10).
HEADCOUNT 30 JUNE 2011 30 JUNE 2010
V/Line skill group
Executive 10 10
Operations 59 72
Station staff 253 252
Conductors 213 214
Train drivers 343* 346*
Authorised Officers 11 6
Infrastructure
maintenance
200 181
Signals and
communications
44 55
Train controllers 51 46
Network services 62 63
Other staff 202 199
Total 1448 1444
* Includes 20 trainee drivers in 2010 and 19 trainees in 2011.
HEADCOUNT 30 JUNE 2011 30 JUNE 2010
Ongoing employees
Employees (headcount) 1391 1388
Full-time (headcount) 1349 1349
Part-time (headcount) 42 39
FTE 1376.2 1375.9
Fixed term and casual
employees
FTE 57 49
Ongoing,
fixed-term
and casual
Employee
(headcount)
Ongoing,
fixed-term and
casual
Employee
(headcount)
Gender
Male 1249 1215
Female 199 173
Age
Under 25 44 46
25-34 212 204
35-44 288 280
45-54 537 530
55-64 333 300
Over 64 37 28
OUR PEOPLE
27

Operations
In May 2011 V/Line introduced new and improved
timetables for the Geelong, Ballarat, Bendigo, Seymour
and Gippsland lines.
Designed to more accurately reflect running times in slower
sections of the metropolitan network, the new timetable
has been a significant contributor in managing increased
passenger numbers and improving on-time performance.
It was developed in conjunction with a major re-working of
the metropolitan network schedule.
The new timetable added two new peak trains to the Geelong
line (where patronage has grown 89 per cent in the past five
years), providing an additional 664 seats each day. Geelong
trains now run to a suburban-style frequency, with weekday
trains arriving in Melbourne every 11 minutes during the
morning peak and departing every 13 minutes during the
evening peak.
The timetable also addressed a number of service gaps,
particularly for Ballan and Gisborne commuters.
The schedule adjustments have already proved beneficial,
with on-time performance in June showing significant
improvements.
With patronage continuing to grow to record levels (an
increase of 6.9 per cent in 2010–11), V/Line increased the
number of services it operates to 63,195 short distance
trains and 10,793 long distance trains.
To help cope with the extra demand, V/Line introduced to
service a further eight three-carriage VLocity sets and one
two-carriage set, adding 1900 much-needed seats. There
are now 128 VLocity carriages in operation, with the final
two three-car sets in the current order to be delivered by
September 2011.
NORTH EAST LINE RETURN
Saturday 25 June 2011 was a red letter day for V/Line
customers in the border towns of Albury and Wodonga
following the ARTC’s $612 million upgrade of the north east
line that began in November 2008. A replacement coach
service operated between Seymour and Albury during the
major construction program.
Minister for Public Transport Mr Terry Mulder officially
opened the new, relocated Wodonga Station to signal
the return initially of two V/Line trains per day – a return
service from Albury. A full service return will occur when
infrastructure works are complete.
Five refurbished carriages for each of the three services
will have about 370 seats. For the first time on this line,
provision has been made for the carriage of bikes in a
renovated van.
The new Wodonga Station features modern passenger
amenities, including an air-conditioned waiting room,
electronic passenger information displays and bike cages.
Car parking is provided for 65 vehicles and a bus bay
supports bus services connecting the station with the
Wodonga city centre. Sustainable design features include
storm water capture facilities.
THE FORCES OF NATURE
Again this year V/Line’s operations were challenged on a
number of occasions by the forces of nature.
Most significantly, record rainfall and floods across northern
and western Victoria in January caused major damage to
V/Line passenger and freight lines.
Passenger train services to Swan Hill, Echuca, Ararat and
Maryborough were temporarily closed due to localised
flooding. Rail track around Kerang was worst hit, with the
V/Line infrastructure team forced to wait almost two weeks
for waters to recede before repairs could begin.
Services were replaced with coaches in flood-affected
areas until repairs were completed and normal train
services resumed.
In October 2010, V/Line worked closely with the Department
of Primary Industries to help manage one of the biggest
locust plagues in 75 years. The locusts had an impact on V/Line
services, particularly in north west Victoria, and resulted in a
need for increased train maintenance and cleaning.
In August, an outbreak of a native grass called Rigid Panic
resulted in line speed restrictions on the Ballarat line near
Melton. Heavy rain earlier in the year is thought to have
contributed to the outbreak of the grass on properties
neighbouring the rail line. When passing trains squashed
the grass onto the track, there was interference to the
signalling system. As a result, trains were slowed and
tracks were regularly scrubbed to ensure the integrity
of the signalling system.
MANAGING DISRUPTIONS
Despite V/Line’s best efforts, there are occasions when
services are interrupted or delayed, causing inconvenience
for our customers. However, significant progress has been
made in recent years to improve the way in which we provide
information to customers at these times.
The V/Line website was refreshed during the year and is
accessed by a large number of customers, as is our email
and SMS update system, V/Line Inform.
Conductors are also better equipped to make real-time
announcements on specific reasons for disruptions. We are
also investigating the use of social media tools to assist
customers at times of disruption or delays.
PLANNING FOR THE FUTURE
Development of V/Line’s new Rail Operations Management
System (ROMS) progressed significantly during the year and
is on track for full deployment by the end of 2012.
This important planning tool will enable automatic
development and management of timetables and crew
28
V/LINE ANNUAL REPORT 2010–11

ostering which in turn will provide valuable information for
co-ordination of fleet deployment, maintenance scheduling
and fault management.
Parts of the timetable management program have already been
trialled and the system will be implemented progressively
over the next year.
The railway operation simulation tool Railsys is also at an
early stage of development, with initial modelling under
way. The system will be trialled as part of the modelling for
Regional Rail Link.
NEW OPERATIONS CENTRE
V/Line developed a new operations centre and associated
driver amenities facility at Southern Cross Station during the
year. The centre provides a consolidated operations facility
with significantly improved staff facilities.
The driver facility at Ballarat was also relocated to an
improved site at East Ballarat.
REGIONAL RAIL LINK
V/Line has completed detailed planning and preparation for
line closures that may be required during construction of the
Regional Rail Link. These closures may require large-scale
replacement coach programs for the Geelong, Ballarat and
Bendigo lines.
Regional Rail Link will provide rail line capacity for enough
extra train services for up to 9000 passengers across the
network in the peak hour. A new line will run from West
Werribee to Deer Park and along the existing rail corridor
through suburbs including Sunshine and Footscray to
Southern Cross Station. It will separate regional trains
from metropolitan trains – for the first time giving Geelong,
Bendigo, and Ballarat trains their own dedicated tracks
through the metropolitan system from Sunshine to Southern
Cross Station. The project will also include two new stations
– one at Wyndham Vale and one at Tarneit.
The first closure on the Ballarat and Bendigo lines took
place in the first two weeks of July 2011, with1364 trains
replaced with 8186 special bus services. More than 190
replacement coaches operated out of Southern Cross during
peak periods.
OVERALL ON-TIME PERFORMANCE
OF TRAINS ON THE REGIONAL NETWORK
2010
2011
2009
2010
short distance 71.5% 81.1%
ON-TIME PERFORMANCE UP TO THE
METROPOLITAN BOUNDARIES*
pakenham
2010
2011
91.8%
2009
2010
93.9%
traralgon
89.2%
85.5%
broadmeadows
97.6%
96.8%
seymour
southern
cross
station
84.6%
86.2%
84.4%
89.5%
watergardens
sunshine
93.0%
93.5%
93.8%
96.1%
bendigo
ballarat
85.7%
83.1%
werribee
96.9%
97.1%
geelong
long distance 69.0% 79.5%
pakenham
90.9%
94.7%
bairnsdale
†
†
broadmeadows
†
†
albury / wodonga †
92.8%
89.6%
97.6%
95.6%
shepparton
southern
cross
station
94.9%
81.8%
94.2%
82.0%
watergardens
97.3%
92.3%
96.4%
93.3%
echuca
swan hill
90.9%
94.3%
sunshine
93.8%
97.2%
ararat
94.1%
96.1%
maryborough
83.3%
85.4%
werribee
92.2%
95.5%
warrnambool
Total journey punctuality
Regional area punctuality
* Regional area punctuality for Melbourne-bound trains is calculated before the train enters the metropolitan system.
Out-bound train punctuality in the regional area is assessed by deducting its actual variance at the metropolitan boundary from its actual variance
at its regional destination.
† Train services were replaced with road coaches between Seymour and Albury / Wodonga from November 2008 due to track upgrade works.
OPERATIONS
29

Fleet
During 2010–11 V/Line introduced one of the most
significant changes ever made to the maintenance regime for
its fleet of passenger trains. From July 2010, global transport
company Bombardier assumed maintenance responsibility
for the entire V/Line ‘classic’ fleet of Sprinters, locomotives
and locomotive-hauled carriages, as well as the VLocity fleet.
In addition, in May this year a new maintenance contract
for the VLocity fleet was also signed with Bombardier,
streamlining current processes and enabling the introduction
of a number of cost saving measures learned from experience
gained over the past five years.
This is the first time V/Line has consolidated its maintenance
contracts under the one contractor. Bombardier has adopted
an innovative approach to maintenance and has made a
number of changes that are already delivering cost savings
and improved reliability. Maintenance is now able to be
carried out 24 hours a day, six days a week with the intent to
move to seven days by the end of 2011.
During the year we also commenced construction of a
new $16.5 million maintenance facility at East Ballarat.
Construction began in May and is expected to be completed
by the end of 2011. The new facility will be capable of
handling three three-car VLocity units at the one time,
significantly improving maintenance turnaround times.
Construction of new VLocity stabling and re-fuelling
facilities at East Ballarat and Geelong has helped to ease
congestion at West Melbourne and has led to availability
improvements, with V/Line now able to operate additional
and longer services.
Nine additional VLocity sets – eight three-car units and one
two-car unit – were introduced to service during the year.
Two further sets will be introduced in the coming year,
completing the current order and taking the number of
VLocity carriage units in service to 134.
With the benefit of six years’ operating experience, the
VLocity sets have performed impressively during the year.
Upgrades to toilets and improvements to carriages added to
passenger comfort.
Investigations into the possible use of selective door opening
technology on longer VLocity trains continued during the
year. This technology – being developed for V/Line by
Bombardier – utilises sensors and door isolation systems so
that passengers cannot inadvertently open a door unless it is
at a platform. Initial trials of sensors have been successfully
completed and detailed design is now under way. Once
approved, the technology will enable V/Line to operate longer
VLocity sets of up to nine cars.
As part of the North East Rail Revitalisation Project, three
V/Line locomotives and three five-car sets of carriages were
converted to standard gauge. Despite not having access to
the new track until a week before the official re-opening of the
line, the converted units have performed well. The project has
also seen the completion of a standard gauge maintenance
facility and new train wash at South Dynon.
A $13 million project to refurbish the older V/Line H-sets
and Sprinters was completed during the year. The upgrades
included new livery, curtains, seat covers and carpet.
The project has also seen the refurbishment of 129
locomotive-hauled carriages. The 15 N-set carriages that will
run to Albury/Wodonga not only had an interior upgrade but
also had air-conditioner upgrades that will improve reliability
and performance in the hotter summer months.
With the introduction of additional VLocity units and
completion of refurbishment of the ‘classic’ fleet, V/Line in
August 2010 retired the oldest of its carriage sets, a fivecarriage
S-Set, whose carriages were between and 50 and
60 years old.
RELIABILITY
The reliability and performance of the VLocity units continued
to improve during 2010–11, travelling an average of 106,066
kilometres between faults (compared with 94,423 in
2009–10 and 83,570 in 2008–09). The availability of VLocity
units also continued to improve, with an average of 90.7 per
cent of the fleet available throughout the year, compared with
89 per cent in 2009–10 and 88.2 per cent in 2008–09.
The reliability of the Sprinter fleet decreased marginally from
23,638 kilometres between faults (23,894 in 2009–10),
while percentage availability improved to 87.9 per cent (87.4
per cent in 2009–10).
Locomotive reliability in the past year was affected by a
number of issues with head power units. Many of these
issues have now been addressed, resulting in significant
improvements in reliability in recent months. The distance
travelled between faults was 25,537 kilometres (30,030 in
2009–10). However, fleet availability remained steady at
81 per cent (80.75 per cent in 2009–10).
Following major work on air-conditioning and door opening
systems, there has been a significant improvement in
the availability of locomotive-hauled carriages. This year,
carriages travelled an average 131,368 kilometres between
faults, compared with 91,918 in 2009–10.
30
V/LINE ANNUAL REPORT 2010–11

Infrastructure
V/Line’s infrastructure division is responsible for the
management and maintenance of 3770 kilometres of
passenger and freight railway lines across Victoria and into
New South Wales.
During 2010–11, in addition to completing a range of major
projects and significant routine maintenance, the division
in January confronted the challenges presented by record
floods across northern and western Victoria.
In one of the worst hit areas, flood waters washed away
400 metres of ballast, rock and track embankments
on the rail line between Kerang and Mologa on the Swan Hill
line. Passenger train services were disrupted for more than
two weeks.
Repairs required 5000 tonnes of road base, 5000 tonnes of
ballast, 1000 tonnes of crushed rock and 300 new sleepers.
More than two million litres of water were pumped from the
rail reserve to enable three 20-tonne and three two-tonne
excavators to access the damaged areas.
Two major freight lines to Robinvale and Sea Lake were cut
during the floods, which also destroyed the Arnold Bridge
50 kilometres west of Bendigo. A $1 million re-build of the
bridge, including burying concrete pillars seven metres
deep, will help protect freight lines from future floods. Bridge
repairs also required the draining of 1.2 million litres of
water from an overflow creek to enable access to the bridge.
Work also began to repair the Cope Cope bridge on the
Mildura line damaged by the floods. The bridge remained
open to freight traffic during the first half of 2011 with
speed restrictions in place while design work has been under
way. A two month line closure is planned to enable repairs to
be completed.
In addition to the physical repair work undertaken in
very trying conditions, V/Line personnel also provided
direct assistance to local residents directly impacted
by the inundation.
MAJOR TRACK WORKS
Major track works on the Gippsland, Geelong and
Warrnambool lines in the past year have seen the
replacement of nearly 100,000 sleepers.
A $25 million program of works was completed ahead of
schedule on the Gippsland line, with 80,000 timber sleepers
replaced by concrete sleepers, which provide long-term
benefits through a reduced requirement for maintenance.
A similar program on the Geelong and Warrnambool lines
began in February this year, with an estimated 80,000
sleepers to be replaced as part of a $25 million program
of works.
Work in the Geelong area involved renewing 16 level
crossings, structural works at rail bridges and general
maintenance works at stations on the line. One in four
sleepers between Marshall and Warrnambool is expected
to be replaced.
The Geelong section of the work was completed in February
with the total program to Warrnambool expected to be
completed later this year.
The Shepparton line was closed to passenger and
freight traffic in March and April to enable major repairs
to a deteriorating embankment at Toolamba. About 400
metres of track was removed and 8000 cubic metres of
soil replaced to rebuild the embankment supporting the
rail line. The project involved the replacement of more than
10,000 sleepers.
MAINTAINING THE NETWORK
Routine maintenance activities during the year saw
upgrades of facilities at V/Line stations, stabling yards and
infrastructure maintenance depots.
Resurfacing was completed at Terang Station, as were tactile
installation at Bunyip and a coping upgrade at North Shore.
CCTV monitoring systems have been installed at Corio, North
Geelong, South Geelong, Colac, Camperdown, Warrnambool,
Wangaratta, Benalla and Ararat.
Major fuel points were constructed at Geelong and
Ballarat East, while dewatering systems were installed
during the year at Swan Hill, Warrnambool, Shepparton,
Kyneton and Albury.
Detailed planning for significant repairs to the Murray River
Bridge at Tocumwal was completed, with work expected to
be carried out in 2011–12.
MOVE TO NEW MAINTENANCE PLANNING APPROACH
A project to analyse the maintenance needs of all V/Line
infrastructure, from rail tracks to bridges and signalling,
progressed during 2010–11. The transition to a reliability
centred maintenance approach is under way and will be
progressed in the year ahead.
Using this approach, all infrastructure under V/Line
control will be mapped and analysed over time to help the
infrastructure division to better understand the reasons and
causes of faults on the network. This will support a move to
a predictive maintenance regime and improved maintenance
strategies, which in turn should lead to a more reliable
railway network and lower operating costs.
INFRASTRUCTURE
31

MELBOURNE METRO AREA
Craigieburn
Bendigo
Hurstbridge
Sydenham
Upfield
Epping
St Albans
Broadmeadows
Jacana
Glenroy
Fawkner
Reservoir
Oak Park
Ballarat
Strathmore
Rosanna
Lilydale
Geelong
Albion
Tottenham
Yard Flemington Jewell Merri
Racecourse
Deer Park
Ardeer
Sunshine
Newmarket
North
Melbourne
Brooklyn
Spotswood
Newport
Seaholme
Port
Melbourne
North Dynon
South Dynon
Southern Cross
Flinders Street
Williamstown Pier
Elsternwick
Clifton Hill
Victoria Park
Richmond
S. Yarra
Caulfield
Glenferrie
Kooyong
Darling
Camberwell
Alamein
Blackburn
Mount Waverley
Glen Waverley
Ringwood
Bayswater
Boronia
Yelta
Brighton Beach
Bentleigh
Huntingdale
Westall Yard
Belgrave
Mildura
Sandringham
Cheltenham
Red Cliffs
Mordiallic
Dandenong
Robinvale
Lyndhurst
Traralgon
Hattah
Cranbourne
Ouyen
Manangatang
Piangil
Moulamein
Stony Point
Panitya
Linga
Mittyack
Nyah West
Swan Hill
Sea Lake
Ultima
Wakool
Deniliquin
Oaklands
Yaapeet
Hopetoun
Woomelang
Kerang
South Kerang
Tocumwal Yard
Strathmerton
Birchip
Wycheproof
Pyramid
Albury
Adelaide
Serviceton
Diapur
Jeparit
Dimboola
Warracknabeal
Murtoa
St Arnaud
Korong Vale
Echuca
Kyabram
Dookie
Dingee
Rochester
Shepparton
Inglewood
Toolamba
Murchison East
Eaglehawk Huntly
Wodonga
Springhurst Bandiana
Wangaratta
Glenrowan
Benalla
Horsham
Glenorchy
Stawell
Marong
Dunolly
Maryborough
Moolort
Bendigo
Castlemaine
Nagambie
Euroa
Mangalore
Seymour
Tallarook
Ararat
Maroona Yard
Beaufort
Clunes
Malmsbury
Kyneton
Woodend
Broadford
Wallan
Branxholme
Glenthompson
Hamilton
Tatyoon
Ballarat
Westmere
Berrybank
Ballan
Sunbury
Diggers Rest
Bacchus Marsh Melton
Werribee
Little River
Craigeburn
Somerton
Bairnsdale
Heywood
Portland
Camperdown
Dennington
Terang
Warrnambool
Colac
Gheringhap
Inverleigh
North
Geelong
Winchelsea
Lara
Geelong
Nar Nar Goon
Longwarry
Pakenham Warragul Moe Traralgon
Drouin
Rosedale
Trafalgar Morwell
Sale
LEGEND
Passenger and freight services (V/Line broad gauge)
Passenger and freight services (ARTC standard gauge)
Freight only (V/Line broad gauge)
Freight only (V/Line standard gauge)
ARTC (standard gauge) including dual gauge
North Geelong – Gheringhap and Geelong grain loop
Metro Trains Melbourne (broad gauge)
Victorian Rail Track Corporation (VicTack)
32
V/LINE ANNUAL REPORT 2010–11

Financial summary
V/Line reported a $17.9 million net surplus before income
tax expense for 2010–11 – an improvement of $3.8 million
over 2009–10.
Continuing operational and contractual efficiencies, coupled
with the timing of some fleet maintenance activities,
contributed to the result. A more neutral outcome is
anticipated for 2012.
Total income increased by $38.2 million to $514.1 million,
including a 7 per cent increase in farebox revenue to
$77.5 million. The farebox has risen 57 per cent from the
$49.3 million recorded in 2006, almost entirely due to the
rapid rise in patronage as ticket prices were cut on average
by 20 per cent in 2007. Price increases in 2008 and 2009
were at or below CPI, with prices held constant in 2010. A
small increase of 3 per cent during 2011 was delayed until
March and as a result had a minor impact on the overall
farebox for the year.
As more people make the switch to public transport, V/Line
has become a more efficient business. A key indicator of
this performance is the subsidy per passenger trip, which
dropped to $18.36 in 2011. This is the fourth consecutive
year that V/Line has reduced this subsidy.
Revenue from rail access fees increased by $828,000 in
2010–11 to $4.2 million. However, the revenue from freight
access continues to be well below pre-drought periods, as
rail continues to struggle against road freight alternatives.
As a result of the ongoing low access fees charged to
freight operators - which were further reduced in 2011 –
a significant proportion of V/Line’s government subsidy
is consumed by the considerable cost of maintaining the
freight rail network.
Although overall maintenance costs were managed to
provide a neutral position year-on-year, this was mainly as
a result of the timing of maintenance issues. The increasing
size of our fleet, combined with ageing locomotives, Sprinter
trains and tiring infrastructure, remain a significant challenge
to the business. Costs in this area will continue to climb in
the years ahead until either fleet is retired or major network
upgrades take place. Increasing fuel costs and the potential
impact of the projected carbon tax will also continue to
increase cost pressures.
ENGAGEMENT OF CONSULTANTS PAID OVER $100,000
Supplier/Vendor Description $’000
Corrs Chambers Westgarth Legal advice 1,237
McCann Erickson Melbourne Marketing services 548
Barrington Centre Pty Ltd Critical incident management and employee assistance program 263
Condico Consulting
CARS – centrol review, 360 O leadership behaviour study,
leadership program, BIP training 209
Interface Rail Engineering Infrastructure condition assessment 162
Vemco Line of sight assessments at 139 level crossings on freight network 118
Mercer (Australia) Pty Ltd Job evaluations and remuneration advice 107
Evans & Peck Pty Ltd Risk assessment stabling study 101
Under $100k 26 consultancies 441
FINANCIAL SUMMARY
33

Corporate governance
V/LINE BOARD
FRANK TAIT – Chairman, since October 2003
Mr Tait is the chair of the boards of both V/Line Corporation (VLC) and V/Line. His career spans government as well as
the rail transport and defence industries. Along with his role on the V/Line boards, Mr Tait is Director of the Infrastructure
Projects Branch within the Department of Transport. He also has a consulting business, advising boards, executive
management and entrepreneurs on business strategy, organisational development and recruitment strategies.
SUSAN OLIVER – Since 1 October 2010
Ms Oliver is an experienced company director of 16 years. She has extensive executive and advisory experience in
information technology, project management, strategy and scenario planning. Her current board appointments are with
Coffey International Limited, Centro Properties Group and Programmed Maintenance Services Limited. She is a governor
of The Smith Family, a director of Melbourne Chamber Orchestra and council member of the AICD in Victoria. She also
manages her own consulting and advisory practice and information technology company, and currently serves on the
Victorian government advisory panel for small technologies.
JACK DIAMOND – Since 1 October 2010
Mr Diamond is Managing Director of Diamond Consulting (Vic) Pty. Ltd. He was worked in the funds management and
the finance industry for over 22 years and has deep experience in banking, funds management, stakeholder relationship
strategic management and marketing. Mr Diamond is currently a director of Victorian Funds Management Corporation,
Industry Funds Services Pty Ltd and related companies. He has previously held directorships in banking, superannuation
funds, and an ASX listed company and not-for-profit charities. Mr Diamond is a Fellow of the Australian Institute of
Company Directors (FAICD).
MOANA WEIR – Since 1 October 2010
Ms Weir has 10 years executive experience in online listed companies - currently with SEEK Ltd, and previously with REA
Group Ltd and Melbourne IT Ltd. She has Australian and international executive business experience in the areas of:
legal, governance, company secretarial, corporate affairs and sustainability, risk management, corporate operations. In
addition, Ms Weir has specialist legal expertise in the areas of IP/IT and M&A and 17 years of legal practice. She holds an
independent board position with a not-for-profit organisation.
FIONA BENNETT – December 2008 to 30 June 2011
Ms Bennett has held senior executive positions in leading listed companies and has experience in commercial and
financial management, governance, risk management and audit across a range of industries, including retail, resources,
manufacturing and health. She has held a number of government, public and not-for-profit board positions and is currently
a director of Alfred Health, Institute of Chartered Accountants in Australia, Legal Services Board, Heide Museum of Modern
Art, Boom Logistics Limited and Hills Industries Limited. Ms Bennett was the deputy chair of the boards of VLC and V/Line
during 2010–11.
MICHAEL TILLEY – July 2006 to 30 June 2011
Mr Tilley has worked in the accounting and finance industries for more than 40 years and has broad senior advisory and
project management experience in all facets of corporate finance. He is the chairman of Terrain Capital. Mr Tilley is also
chairman of Lower Murray Water Authority and Free Eyre Limited and a director of Vision Super Pty Ltd, Hawesbridge Private
Equity Limited, Oliver Hume (Australia) Pty Ltd and Dacland Management Pty Ltd..
DAVID WORTH – December 2008 to 30 June 2011
Mr Worth is a Chartered Accountant and an experienced director and adviser in the transport and logistics industry
and the property industry. He has had senior executive experience in corporate finance, supply chain management,
property development, corporate strategy and IT. He is Chairman of OnCard International Limited, a director of Dacland
Management Pty Ltd, Propell National Valuers Pty Ltd, two property investment funds associated with Marks Henderson
Funds Management and the development trusts and companies established by Dacland Management to manage property
projects for Sophisticated Investors.
34
V/LINE ANNUAL REPORT 2010–11

V/LINE EXECUTIVE
ROB BARNETT
CEO
Executive team leader,
management representative
on the V/Line Board, and
member of the government’s
Victorian Railway Steering
Committee on Level
Crossings.
GEOFF ARTHUR
General Manager
Operations
TONY HENWOOD
General Manager
Network Services
GRAHAM PERRY
General Manager
Engineering
ROSS PEDLEY
General Manager
Corporate and Finance
Delivery, planning
and development
of our train and
coach services.
Provision of access to
freight and passenger
train operators.
Rolling stock engineering
services, including
maintenance of the
current fleet and
development of
new trains.
Corporate and financial
management services,
including IT, contracts
and procurement.
ANDREW LAST
General Manager
Infrastructure
Maintenance and
upgrade of rail, signalling
and other infrastructure.
JENNY KELMAN
General Manager
Human Resources
Recruitment, training
and HR services.
Industrial relations
and organisational
development.
LAURIE FOLEY
General Manager
Safety, Security
& Environment
Incident management
and safe-working,
security, risk and safety
improvement programs,
OH&S, DDA and
environment.
PAUL MATTHEWS
General Manager
Marketing &
Stakeholder
Relations
Customer relations,
marketing and
business development,
communications and
media, and community
relations.
REBECCA NORTHEAST
Company (Corporation)
Secretary and
Legal Coordinator
Legal services, company /
corporation administration.
CORPORATE GOVERNANCE
35

V/LINE CORPORATION (VLC) AND V/LINE PTY LTD
(V/Line)
VLC was established on 15 July 2003 as a statutory rail
corporation under the Rail Corporations Act 1996 and
continues under the Transport Integration Act 2010. On
14 October 2008 VLC was also declared a state business
corporation pursuant to the State Owned Enterprises Act
1992. V/Line Corporation is governed by the Transport
Integration Act 2010, which sets out its object and functions.
The Transport Integration Act creates a framework for
the provision of an integrated and sustainable transport
system, and all Victorian transport agencies, including
V/Line Corporation, are required to work together towards
this common vision. VLC is the sole shareholder of the main
operating entity, V/Line.
In 2003 V/Line entered into a franchise agreement with
the Director of Public Transport (the Director), representing
the State Government of Victoria, to operate regional rail
throughout Victoria. The current franchise agreement will
expire on 31 December 2012 with the State having a further
12 month option.
In July 2004, the Director directed V/Line to facilitate the
operation of heritage rail (i.e. steam) services on behalf of
identified rail heritage groups.
In April 2007, the Director directed V/Line to operate the
regional below-rail business following the state’s buyback
of the infrastructure from Pacific National, to facilitate track
access for the operation of both passenger and freight rail
services from 5 May 2007.
BOARD OF DIRECTORS
The boards of VLC and V/Line consist of the same nonexecutive
directors, with the board of the parent entity,
VLC, reporting to the Minister for Public Transport and
to the Treasurer. Jack Diamond, Susan Oliver and Moana Weir
were appointed to the board of VLC on 1 October 2010 and
V/Line on 27 October 2010. Fiona Bennett, Michael Tilley
and David Worth ceased to be directors of VLC and V/Line
from 1 July 2011.
Each board has established protocols and procedures to
ensure that corporate governance is maintained at the
highest levels and that the strategic direction and overall
performance of the respective business entities can be
developed and monitored diligently. The board of V/Line has
also delegated certain of their functions to board committees
which focus on relevant important areas of operations.
Further details regarding these board committees are set
out later in this section.
BOARD MEETINGS ATTENDANCE
The boards of VLC and V/Line generally hold bi-monthly
meetings and additional meetings as required.
V/Line Corporation
DIRECTOR
NO. ELIGIBLE TO ATTEND NO. ATTENDED
Mr Frank Tait (Chair) 6 5
Ms Fiona Bennett 6 5
Mr Michael Tilley 6 5
Mr David Worth 6 6
Mr Jack Diamond 5 3
Ms Susan Oliver 5 2
Ms Moana Weir 5 4
V/Line Pty Ltd
DIRECTOR NO. ELIGIBLE TO ATTEND NO. ATTENDED
Mr Frank Tait (Chair) 6 5
Ms Fiona Bennett 6 5
Mr Michael Tilley 6 5
Mr David Worth 6 6
Mr Jack Diamond 5 3
Ms Susan Oliver 5 2
Ms Moana Weir 5 4
ACCESS TO INFORMATION
Directors of VLC and V/Line are allowed full access
to information required in order to discharge their
responsibilities. Directors of both entities may obtain
independent professional advice on matters arising in the
course of board duties. The board of VLC receives written
reports from the CEO of VLC at each board meeting on
compliance by V/Line of its ongoing obligations under
ministerial directions. Directors also have access to senior
managers and/or officers of the entity on whose board they
serve and, on request, to documents held by the entity.
36
V/LINE ANNUAL REPORT 2010–11

INDEMNIFICATION OF OFFICERS
VLC and V/Line have entered separately into deeds of
indemnity and access with each current and former
director and the company (corporation) secretary.
Before its deregistration on 4 February 2008, Victorian
Rail Heritage Operations Pty Limited (VRHO) entered into
a deed of indemnity and access with its sole director,
Mr Rob Barnett. These deeds of VLC, V/Line and VRHO
provide for indemnification against liabilities arising
from the conduct of the business or from the discharge
of directors’ and officers’ duties (other than any liability
relating to a wilful breach of duty or trust) and the
maintenance of directors’ and officers’ insurance.
During the financial year, V/Line insured all directors
and officers of VLC and V/Line against certain liabilities
incurred by them in that capacity. In accordance with normal
commercial practices, the terms of the insurance contract
prohibit disclosure of details of the nature of the liabilities
covered by the insurance contract and the amount of the
premium paid under the contract.
BOARD COMMITTEES
The board of V/Line has established three board
committees: the Remuneration; Audit and Commercial Risk;
and Safety, Security and Environment committees.
Remuneration Committee:
• The function of the committee includes assisting the
board in the appointment, review and succession of the
Chief Executive Officer and reviewing remuneration policy
of staff.
• Members as at 30 June 2011: Moana Weir (Chair) and
Frank Tait.
• Number of meetings held during the year: two.
Audit and Commercial Risk Committee:
• The function of the committee is to assist the board to
oversee the financial and commercial risk management
framework, including to review and monitor accounting
policies and practices, and to evaluate and develop
financial and commercial risk management systems.
• Members as at 30 June 2011: Michael Tilley (Chair),
Fiona Bennett and Susan Oliver.
• Number of meetings held during the year: four.
Safety, Security and Environment Committee:
• The function of the committee is to assist the board
in discharging its obligations in relation to V/Line’s
health, safety, security and environment practices and
in providing an overview mechanism for examining the
management of operational risk management in V/Line.
• Members as at 30 June 2011: David Worth (Chair),
Jack Diamond and Frank Tait.
• Number of meetings held during the year: four.
CORPORATE PLAN
In accordance with the Transport Integration Act 2010,
VLC prepared its corporate plan, including its statement of
corporate intent. The corporate plan is prepared annually
and covers a three year period starting from the current
financial year.
MINISTERIAL DIRECTIONS
VLC received no ministerial directions for the period ending
30 June 2011.
FREEDOM OF INFORMATION
VLC is subject to the provisions of the Freedom of
Information Act 1982. For the year ended 30 June 2011,
VLC received three requests for access to information. Of
these requests, one was from the media and two were from
members of the public.
BUILDING ACT 1993
It is V/Line’s policy to ensure that new buildings and works
to existing buildings carried out for and on its behalf comply
with the Building Act 1993.
NATIONAL COMPETITION POLICY
VLC continues to comply with the requirements of the
National Competition Policy.
WHISTLEBLOWERS PROTECTION ACT
VLC and V/Line are subject to the provisions of the
Whistleblowers Protection Act 2001 and V/Line has
procedures in place for managing any disclosures about
V/Line or any of its officers. In the past year no disclosures
have been received or investigations made, nor have any
disclosures been referred to the Ombudsman, nor has
the Ombudsman referred any disclosures or made any
recommendation to VLC or V/Line.
CORPORATE GOVERNANCE
37

IMPLEMENTATION OF THE VICTORIAN INDUSTRY
PARTICIPATION POLICY (VIPP)
V/Line entered into five contracts for the year ended
30 June 2011 to which VIPP thresholds applied and VIPP
compliance was undertaken. VLC’s and V/Line’s standard
tendering procedures include compliance with VIPP as and
when required.
AVAILABILITY OF INFORMATION
V/Line’s publications and statements are principally held at
www.vline.com.au. The Standing Directions of the Minister
for Finance, pursuant to the Financial Management Act 1994,
require a range of information to be prepared in relation to
the financial year. The material is retained by V/Line and can
be made available to Ministers, Members of Parliament and
the public on request, subject to the Freedom of Information
Act 1982.
RISK MANAGEMENT
A process is in place for V/Line and VLC to meet their
obligations under the Victorian Managed Insurance Authority
Act 1996. The board of V/Line, as the significant operating
entity, considers risk management issues regularly as part
of its bi-monthly board meetings, through the activities
of both the Safety, Security and Environment Committee
and the Audit and Commercial Risk Committee, as well
as through a robust internal audit process known as the
enterprise wide risk management system. V/Line also has
in place other policies and management systems to ensure
that operational and compliance matters are efficiently and
effectively addressed. V/Line has a Management System
Manual, which provides a comprehensive overview of these
policies and management systems, including the enterprise
wide risk management system, legislative compliance
policies, an environment management system, and an audit
framework for safety, security and environmental matters.
VICTORIAN GOVERNMENT RISK MANAGEMENT
FRAMEWORK ATTESTATION
I, Frank Tait, certify that V/Line Corporation through
its wholly owned subsidiary and operating company,
V/Line Pty Ltd, has risk management processes in
place consistent with the Australian / New Zealand
Risk Management Standard AS/NZS 4360 and an
internal control system is in place that enables the
executive to understand, manage and satisfactorily
control risk exposures. The board verifies that this
assurance and the risk profiles of V/Line Corporation
and V/Line Pty Ltd have been critically reviewed within
the last 12 months.
Frank Tait
Chairman
30 June 2011
38
V/LINE ANNUAL REPORT 2010–11

Financial statements
CONTENTS
Statutory Statement 40
Consolidated Comprehensive Operating Statement 41
Consolidated Balance Sheet 42
Consolidated Statement of Changes in Equity 43
Consolidated Cash Flow Statement 43
Notes to the Financial Statements 44-67
Independent Auditor’s Report 68-69
Disclosure Index 72
FINANCIAL STATEMENTS CONTENTS
39

STATUTORY STATEMENT
We certify that the attached financial statements for V/Line Corporation and its subsidiary have been prepared in accordance
with Standing Direction 4.2 of the Financial Management Act 1994, applicable financial reporting directions, Australian
Accounting Standards and other mandatory professional reporting requirements.
We further state that, in our opinion, the information set out in the Consolidated Comprehensive Operating Statement,
Consolidated Balance Sheet, Consolidated Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes
to the Financial Statements, presents fairly the financial transactions during the year ended 30 June 2011 and the financial
position of the consolidated entity at this date.
We are not aware of any circumstance which would render any particulars included in the financial statements to be
misleading or inaccurate.
The Accountable Officer and the Chief Financial Accounting Officer have, within the last 12 months, made formal statements
to the Board that:
• The Corporation’s financial reports present fairly, in all material respects, the Corporation’s financial position and
operational results in accordance with the requirements of the Financial Management Act 1994 including the Directions;
• The financial report is founded on a sound system of risk management and internal compliance and control which
implements the policies adopted by the Board; and
• The Corporation’s risk management and internal compliance and control system is operating efficiently and effectively in
all material respects.
We authorise the attached financial statements for issue on 11 August 2011.
Frank Tait, Chairman
Susan Oliver, Director
Rob Barnett, Chief Executive Officer
Ross Pedley, General Manager
– Corporate & Finance
40
V/LINE ANNUAL REPORT 2010–11

CONSOLIDATED COMPREHENSIVE OPERATING STATEMENT FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
Notes 2011 2010
$’000 $’000
INCOME FROM TRANSACTIONS
Revenue 2(a) 410,994 376,543
Other income 2(b) 103,097 99,257
Total income from transactions 514,091 475,800
EXPENSES FROM TRANSACTIONS
Operational expenses 3(a) 267,974 252,367
Depreciation 3(b) 13,281 19,027
Administrative expenses 60,188 54,911
Selling expenses 2,224 2,159
Marketing and communication 3,667 3,920
Customer service expenses 3,179 3,082
Project expenses 51,993 34,718
Infrastructure maintenance 54,874 58,431
Trains provided free of charge 1(i) 38,756 33,024
Total expenses from transactions 496,136 461,639
Net Result before income tax expense 17,955 14,161
Income tax (expense) benefit 4 (5,222) 1,779
NET RESULT FOR THE PERIOD 13 12,733 15,940
OTHER ECONOMIC FLOWS – OTHER NON-OWNER CHANGES IN EQUITY
Movement in asset revaluation reserve (net of tax of $4,188) – 9,772
Total other economic flows – Other non-owner changes in equity – 9,772
COMPREHENSIVE RESULT FOR THE PERIOD 12,733 25,712
The above Consolidated Comprehensive Operating Statement should be read in conjunction with the accompanying notes.
FINANCIAL STATEMENTS
41

CONSOLIDATED BALANCE SHEET AS AT 30 JUNE 2011
Notes 2011 2010
$’000 $’000
ASSETS
Financial assets
Cash and cash equivalents 5 18,460 9,137
Receivables 6 21,449 25,581
Total financial assets 39,909 34,718
Non-financial assets
Inventories 7 6,764 7,046
Property, plant and equipment 8 162,714 154,538
Other non-financial assets 9 675 874
Total non-financial assets 170,153 162,458
Total assets 210,062 197,176
LIABILITIES
Payables 1(q),11 42,041 52,545
Short-term provisions 1(s),12 57,643 53,374
Long-term provisions 1(s),12 5,354 4,188
Deferred tax liabilities 4 7,631 2,409
Total liabilities 112,669 112,516
Net assets 97,393 84,660
EQUITY
Accumulated losses 13 (17,292) (30,025)
Asset Revaluation Reserve 13 114,685 114,685
Total equity 97,393 84,660
Commitments for expenditure 21 223,874 348,869
Contingent assets and liabilities 23 – –
The above Consolidated Balance Sheet should be read in conjunction with the accompanying notes.
42
V/LINE ANNUAL REPORT 2010–11

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
Notes Equity at Total Equity at
1 July 2010 comprehensive 30 June 2011
result
$’000 $’000 $’000
2011
Accumulated surplus / (deficit) (30,025) 12,733 (17,292)
Asset revaluation reserve 114,685 – 114,685
Total equity at end of the financial year 84,660 12,733 97,393
Notes Equity at Total Equity at
1 July 2009 comprehensive 30 June 2010
result
$’000 $’000 $’000
2010
Accumulated surplus / (deficit) (45,965) 15,940 (30,025)
Asset revaluation reserve 104,913 9,772 114,685
Total equity at end of the financial year 58,948 25,712 84,660
The above Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes.
CONSOLIDATED CASH FLOW STATEMENT FOR THE FINANCIAL YEAR ENDED 30 JUNE 2011
Notes 2011 2010
$’000 $’000
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts from government (GST inclusive) 416,250 394,050
Receipts from other entities (GST inclusive) 115,767 97,282
Payments to suppliers and employees (GST inclusive) (490,043) (450,730)
GST payments to the Australian Taxation Office (12,601) (12,308)
Interest received 1,407 590
Net cash flows from (used in) operating activities 15 30,780 28,884
CASH FLOWS FROM INVESTING ACTIVITIES
Payment for plant and equipment (21,457) (22,532)
Net cash flows from (used in) investing activities (21,457) (22,532)
Net increase/(decrease) in cash and cash equivalents 9,323 6,352
Cash and cash equivalents at the beginning of the financial year 9,137 2,785
Cash and cash equivalents at the end of the financial year 5 18,460 9,137
The above Consolidated Cash Flow Statement should be read in conjunction with the accompanying notes.
FINANCIAL STATEMENTS
43

NOTES TO THE FINANCIAL STATEMENTS
Note 1
Note 2
Note 3
Note 4
Note 5
Note 6
Note 7
Note 8
Note 9
Note 10
Note 11
Note 12
Note 13
Note 14
Note 15
Note 16
Note 17
Note 18
Note 19
Note 20
Note 21
Note 22
Note 23
Note 24
Note 25
Note 26
Summary of significant accounting policies
Income
Operational expenses
Income tax
Cash and cash equivalents
Receivables
Inventories
Property, plant and equipment
Other non-financial assets
Investments
Payables
Provisions
Equity
Financial instruments
Cash flow information
Responsible persons
Remuneration of directors
and accountable officer
Remuneration of executives
Remuneration of auditors
Related party disclosures
Operating leases and expenditure commitments
Employee benefits and superannuation
commitments
Contingent assets and liabilities
Subsequent events
Economic dependency
Dividends
NOTE 1
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
These annual financial statements represent the general
purpose financial statements for V/Line Corporation which
is a Victorian statutory corporation established in Australia
under the Rail Corporations Act 1996.
V/Line Passenger Corporation changed its name to V/Line
Corporation on 1 July 2010.
Its principal address is:
V/Line Corporation
Level 23, 570 Bourke Street
Melbourne VIC 3000
(a) Statement of compliance
The financial statements have been prepared in accordance with
the Financial Management Act 1994 and applicable Australian
Accounting Standards, including interpretations (AASs).
The annual financial statements were authorised for issue
by the board on 11 August 2011.
(b) Basis of accounting preparation and measurement
The accrual basis of accounting has been applied in the
preparation of these financial statements whereby assets,
liabilities, equity, income and expenses are recognised in
the reporting period to which they relate, regardless of when
cash is received or paid.
The financial statements have been prepared in accordance
with the historical cost convention except for certain noncurrent
physical assets which, subsequent to acquisition,
are measured at a revalued amount being their fair
value at the date of the revaluation less any subsequent
accumulated depreciation and subsequent impairment
losses. Revaluations are conducted with sufficient regularity
to ensure that carrying amounts do not materially differ from
fair value.
Historical cost is based on the fair values of the
consideration given in exchange for assets.
Accounting policies are selected and applied in a manner
which ensures that the resulting financial information
satisfies the concepts of relevance and reliability, thereby
ensuring that the substance of the underlying transactions
or other events is reported.
The accounting policies set out below have been applied
in preparing the financial statements for the year ended
30 June 2011 and the comparative information presented for
the year ended 30 June 2010.
This financial report is presented in Australian Dollars and all
values are rounded to the nearest thousand dollars ($’000)
unless otherwise stated.
44
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
(c) Principles of consolidation of controlled entities
The financial report comprises the consolidated financial statements of V/Line Corporation and its subsidiary V/Line Pty Ltd.
The effects of all transactions between entities in the consolidated entity are eliminated in full.
Where control of an entity is obtained during a financial year, its results are included in the Consolidated Comprehensive
Operating Statement from the date on which control commences. Where control of an entity ceases during a financial year its
results are included for that part of the year during which control exists.
V/Line Corporation is represented by:
Investment in subsidiary $1
Contributed equity $1
The Corporation has no other assets or liabilities.
Given the immaterial nature of the investment by the parent entity it has not been reported separately.
The controlled entities consolidated within the V/Line Corporation group are:
Name Country of incorporation Equity interest 2011 2010
$’000 $’000
V/Line Pty Ltd Australia 100% – –
(d) Not for profit
The board is of the view that the consolidated entity qualifies
as a not-for-profit entity since the primary obligation of the
Corporation is the delivery of subsidised public
transportation services to regional Victoria. The entity has
signed a Franchise Agreement with the Director of Public
Transport which determines the services that the Corporation
provides and the payments received for those services.
Hence, the entity’s funding is based on achieving a small
loss before interest, depreciation and tax and neither the
mission nor corporate strategies of the Corporation reflect
achieving profit. The entity has been deemed to have a
not-for-profit status and accordingly complies with
accounting standards set for not-for-profit entities
(e) Going concern
Notwithstanding the deficiency in net current assets of $52.3
million (2010: $63.3 million) this financial report has been
prepared on a going concern basis. The consolidated entity
is subsidised by its ultimate parent entity, the State
Government of Victoria, pursuant to a Franchise Agreement
with the Director of Public Transport.
The funding requirements for the year ended 30 June 2012
have been agreed by the Director of Public Transport under
an approved budget allocation pursuant to the Franchise
Agreement. The Franchise Agreement contains provisions for
the company’s funding requirements to be met by the State
Government of Victoria throughout the franchise period.
The Director of Public Transport acknowledges and agrees
that, for the benefit of the directors of the consolidated entity
and without limiting the level of financial support, the
Director of Public Transport has agreed to provide the
consolidated entity funding to a level sufficient for it to
comply with the solvency requirements under the
Corporations Act 2001.
The Director of Public Transport has also agreed that, while
the consolidated entity is under state ownership, the
Department of Transport will meet all of the consolidated
entity’s employee entitlements as and when those amounts
fall due in the event the consolidated entity is not able to
meet these financial obligations.
The financial report does not include any adjustments
relating to the recoverability and classification of recorded
asset amounts, nor to the amounts and classification of
liabilities that may be necessary should the consolidated
entity not continue as a going concern.
Refer to note 25 for further details of the consolidated
entity’s economic dependency on the State Government
of Victoria.
(f) Comparatives
When the presentation or classification of items in the
financial report is amended, comparative amounts have
been reclassified unless the reclassification is impractical.
FINANCIAL STATEMENTS
45

NOTES TO THE FINANCIAL STATEMENTS
(g) National Tax Equivalent Regime (NTER)
By direction of the Treasurer of Victoria, under the State Owned
Enterprise Act 1992, the consolidated entity entered into the
NTER on 1 October 2003. Any NTER expense payable is
calculated on operating profit or loss adjusted for temporary
differences between NTER income and accounting income.
Deferred tax is accounted for using the balance sheet liability
method in respect of temporary differences arising between
the tax bases of assets and liabilities and their carrying
amounts in the financial statements. No deferred income tax
will be recognised from the initial recognition of an asset or
liability, excluding a business combination, where there is no
effect on accounting or taxable profit or loss.
Deferred tax is calculated at the tax rates that are expected to
apply to the period when the asset is realised or liability is
settled. Deferred tax is credited in the Comprehensive
Operating Statement except where it relates to items that may
be credited directly to equity, in which case the deferred tax is
adjusted directly against equity.
Deferred income tax assets are recognised to the extent that it
is probable that future tax profits will be available against
which deductible temporary differences can be utilised.
The amount of benefits brought to account or which may be
realised in the future is based on the assumption that no
adverse change will occur in income taxation legislation and
the anticipation that the economic entity will derive sufficient
future assessable income to enable the benefit to be realised
and comply with the conditions of deductibility imposed by
the law.
Under existing arrangements with the Administrator of the
National Tax Equivalent Regime, V/Line Pty Ltd and its holding
company V/Line Corporation are treated as separate entities
for the purposes of their income tax compliance obligations.
Each entity accounts for tax on a stand-alone basis not on a
consolidated income tax basis.
(h) Goods and Services Tax
Income, expenses and assets are recognised net of the
amount of associated GST unless the GST incurred is not
recoverable from the taxation authority in which case it is
recognised as part of the cost of acquisition of the asset or
as part of the expense.
Receivables and payables are stated inclusive of the
amount of GST receivable or payable. The net amount
of GST recoverable from, or payable to, the taxation
authority is included with other receivables or payables
in the balance sheet.
Cash flows are presented on a gross basis. The GST
components of cash flows arising from investing or financing
activities which are recoverable from, or payable to the
taxation authority, are presented as operating cash flows.
(i) Revenue
Revenue is recognised and measured at the fair value of
the consideration received or receivable to the extent it
is probable that the economic benefits will flow to the
Corporation and that it can be reliably measured.
TICKET SALES
Fare-box revenue is recognised when the passenger services
are provided. Revenue from tickets that relate to passenger
trips to be taken after the reporting date are deferred and
recognised as a liability.
CONTRIBUTIONS
The State Government of Victoria provides subsidies that are
recognised as revenue when they are controlled by the
Corporation, which is generally upon receipt of the subsidy.
VALUE IN KIND
Use of VLocity, diesel multiple unit trains are leased or
owned by Rolling Stock Holdings Pty Ltd and received free of
charge (“Value in Kind”;“VIK”). The VIK measurement is
based on the value of the lease payments or the notional
lease value based on the capital cost per unit of rolling stock
purchased outright.
(j) Cash and cash equivalents
Cash and cash equivalents comprise cash on hand and cash
at bank, deposits at call and highly liquid investments with
an original maturity of three months or less, which are held
for the purpose of meeting short-term cash commitments
rather than for investment purposes, and which are readily
convertible to known amounts of cash and are subject to an
insignificant risk of changes in value.
46
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
(k) Trade and other receivables
Trade and other receivables representing passenger,
inter-operator and other revenues receivable are carried at
nominal amounts due less any allowance for impairment.
A provision for impairment is recognised when collection
of the full amount is no longer probable (> 90 days). For
trade receivables, normal terms are 30 days and 7 days for
agency accounts.
Receivables from related parties consist predominantly of
amounts owing from the Department of Transport and are
carried at nominal value due to their short-term nature. There
is no interest charged on related party receivables.
(l) Inventories
V/Line has a contract with a supplier for the supply of spare
parts which are to be made available upon request. This
practice is considered by industry to be best practice as it
has the lowest storage costs. The cost of these spare parts is
based on the first-in, first-out principle.
(m) Investment in subsidiaries
Investments in subsidiaries are carried at cost.
(n) Property, plant and equipment
Rolling stock is measured at fair value and all other noncurrent
assets are measured at cost, less any accumulated
depreciation and impairment losses.
Revaluations are assessed annually and supplemented by
independent assessments every three or four years.
Revaluations are conducted in accordance with AASB 116
Property, Plant and Equipment and FRD 103D Non-Current
Physical Assets.
(i) Valuation of rolling stock and rotables
V/Line Pty Ltd undertook an independent revaluation of its
rolling stock as at 30 June 2010. The 2010 valuation was
performed by rolling stock specialists and reviewed by Valuer
General Victoria. Due to the specialised nature of the assets,
V/Line has adopted depreciated replacement cost as the
valuation basis for its rolling stock. This approach is in
accordance with the requirements of AASB 116 and FRD
103D, which states that the net recoverable test does not
apply to a not-for-profit entity since there is no dependence
on its assets abilities to generate net cash inflows.
Revaluation increments or decrements are accounted
for as follows.
– Net revaluation increments are credited directly against the
asset revaluation reserve, except where the net increment
reverses a net revaluation decrement previously recognised
as an expense in net profit or loss/result in that same class
of assets. Where the exception applies, the revaluation
increment is recognised as revenue in net profit or loss/
result;
– Net revaluation decrements are recognised as an expense
in net profit or loss/result, except where a credit balance
exists in the asset revaluation reserve in that same class of
assets. Where the exception applies the net revaluation
decrement grossed up for any related recognised current
tax and deferred tax is debited directly to the asset
revaluation reserve.
Revaluation increments and revaluation decrements relating
to individual assets within an asset class are offset against
one another within that asset class and are not offset in
respect of assets in different classes.
(ii) Depreciation of property, plant and equipment
Depreciation is calculated on a straight-line basis over the
estimated useful life of the assets, including rolling stock
and buildings. The rolling stock fleet comprises diesel
electric locomotives, carriages, diesel multiple units (known
as sprinters) and vans.
Repairs and maintenance work on rolling stock is scheduled
in accordance with V/Line Pty Ltd’s rolling stock management
plan and rail safety management standards. Scheduled
maintenance examinations on rolling stock are determined
at set intervals depending on the type of rolling stock.
The refurbishment program included in the rolling stock
management plan includes major examinations and
overhauls of rolling stock. The consolidated entity treats
these examinations as significant upgrades, which extend
the useful life of the rolling stock. Included in the
refurbishment program is the replacement of major units
such as traction and locomotive motors, generators, wheel
sets and bogies. These items are capitalised and
depreciated over their useful life. All other maintenance
examinations and minor work are treated as repairs and
maintenance and expensed when incurred.
FINANCIAL STATEMENTS
47

NOTES TO THE FINANCIAL STATEMENTS
(iii) Estimated useful lives of property, plant and equipment
The estimated useful lives for the different asset classes for
both current and prior years are set out below.
Plant and equipment
Rolling stock
Leasehold improvements
Rolling stock – capitalised improvements
3 to 10 years
4 to 17 years
3 to 10 years
4 to 17 years
The assets’ residual values, useful lives and depreciation
methods are reviewed, and adjusted if appropriate, at each
financial year end.
As part of an independent valuation as at 30 June 2010,
the estimated useful lives of rolling stock were re-assessed.
The financial impact of the re-assessment of useful lives
has resulted in a reduction of the depreciation expense by
$5.6 million in the current financial year.
(iv) Leasehold improvements
The cost of improvements to leasehold properties is amortised
over the unexpired period of the lease or the estimated useful
life of the improvement, whichever is the shorter.
(o) Leased assets
(i) Finance leases
Leases of property, plant and equipment are classified as
finance leases whenever the terms of the lease transfer
substantially all the risks and benefits of ownership to the
lessee. All other leases are classified as operating leases.
The entity does not have any finance leases.
(ii) Operating leases
Lease payments for operating leases, where substantially all
the risks and benefits of ownership remain with the lessor, are
recognised as an expense in the Consolidated Comprehensive
Operating Statement in the periods in which they are incurred.
(iii) Lease incentives
In the event that lease incentives are received to enter
into operating leases, such incentives are recognised
as a liability. The aggregate benefits of incentives are
recognised as a reduction of rental expense on a straightline
basis, except where another systematic basis is more
representative of the time pattern in which economic
benefits from the leased asset are consumed.
(p) Impairment of assets
At each reporting date, the group reviews the carrying
amounts of its tangible assets to determine whether
there is any indication that those assets have suffered
an impairment loss. If any such indication exists, the
recoverable amount of the asset, being the higher of
the asset’s fair value less costs to sell and depreciated
replacement cost, is compared to the asset’s carrying
amount. Any excess of the asset’s carrying amount
over its recoverable amount is recognised as an expense
in the Consolidated Comprehensive Operating Statement,
unless the relevant asset is carried at fair value, in which
case the impairment loss is accounted for by reducing the
asset revaluation reserve.
(q) Payables
Payables consist predominantly of trade creditors and other
sundry liabilities.
Trade creditors represent liabilities for goods and services
provided to the consolidated entity prior to the end of the
financial year and which are unpaid. These amounts are
brought to account when the obligation to make future
payments in respect of the purchase of the goods and
services arises.
Other liabilities included in payables mainly consist of
unearned/prepaid income, goods and services tax and
payroll related payables.
All payables are initially recognised at fair value plus
transaction costs and subsequently carried at their
nominal amount due to their short-term nature.
(r) Employee benefits
Provisions are made for employee benefits accumulated
as a result of employees rendering services up to the
reporting date. These benefits include annual leave and
long service leave.
Liabilities arising in respect of wages and salaries, annual
leave, and any other employee benefits expected to be
settled within 12 months of the reporting date are measured
at their nominal amounts based on remuneration rates
which are expected to be paid when the liability is settled,
including related on-costs.
48
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
Long service leave liabilities are measured at the present
value of the estimated future cash outflows to be made in
respect of services provided by employees up to the
reporting date, including related on-costs. In determining the
present value of future cash outflows, the interest rates
relating to government guaranteed securities are used,
which have terms to maturity approximating the terms of the
related liability.
Employee benefit expenses arising in respect of salaries and
wages, annual leave, long service leave, other leave benefits
and other employee benefits are charged against the
Consolidated Comprehensive Operating Statement.
The contributions made to superannuation funds by the
consolidated entity are charged against the Consolidated
Comprehensive Operating Statement when due.
(s) Provisions
Provisions are recognised when the entity has a present
obligation, the future sacrifice of economic benefits is
probable, and the amount of the provision can be measured
reliably.
The amount recognised as a provision is the best estimate
of the consideration required to settle the present obligation
at reporting date, taking into account the risks and
uncertainties surrounding the obligation. Where a provision
is measured using the cash flows estimated to settle the
present obligation, its carrying amount is the present value
of those cash flows using market yields at the reporting date
on national government bonds with terms to maturity that
match, as close as possible, the estimated future cash flows.
(t) Commitments
Commitments are disclosed at their nominal value and
inclusive of the goods and services tax (GST) payable.
(u) Contingent assets and contingent liabilities
Contingent assets and contingent liabilities are not recognised
in the Consolidated Balance Sheet, but are disclosed by way
of a note and, if quantifiable, are measured at nominal value.
Contingent assets and contingent liabilities are presented
inclusive of GST receivable or payable respectively.
(v) Significant accounting estimates and judgments
Management evaluate estimates and judgments
incorporated into the financial report based on historical
knowledge and best available current information. Estimates
assume a reasonable expectation of future events and are
based on current trends and economic data, obtained both
externally and within the group.
Outlined below are the critical estimates and judgements
made by management in the process of applying the entity’s
accounting policies, and that have the most significant effect
on the amounts recognised in the financial statements.
(i) Impairment
The group assesses impairment at each reporting date
by evaluating conditions specific to the group that may lead
to an impairment of assets. Where an impairment trigger
exists, the recoverable amount of the asset is determined.
Depreciated replacement cost calculations performed in
assessing recoverable amounts incorporate a number of
key estimates.
(ii) Allowance for impairment loss on trade receivables
There has been a $241,175 decrease in the provision for
doubtful debts in 2010/2011 based on a detailed analysis
of the recoverability of individual accounts.
(iii)Timing of employment provisions
All employment provisions are classified according to
whether the entity has an unconditional right to defer
settlement beyond 12 months
(iv) Useful lives of property, plant and equipment
Property, plant & equipment useful lives are reviewed on an
annual basis to ensure their contribution is realistically
based on their useful economic life.
(w) New accounting standards and interpretations
Certain new accounting standards and interpretations have
been published that are not mandatory for the reporting
period ending 30 June 2011. As at 30 June 2011, the
following standards and interpretations had been issued but
were not mandatory for the financial year ending 30 June
2011. V/Line has not, and does not intend to adopt these
standards early.
FINANCIAL STATEMENTS
49

NOTES TO THE FINANCIAL STATEMENTS
Standard/Interpretation Summary Applicable for
annual reporting
periods beginning
on or after
Impact on financial
statements
AASB 9 Financial Instruments.
This Standard simplifies requirements
for the classification and measurement
of financial assets resulting from Phase
1 of the IASB’s project to replace IAS 39
Financial Instruments: Recognition and
Measurement (AASB 139 Financial
Instruments :Recognition and
Measurement).
Beginning
1 Jan 2013.
Detail of impact is still
being assessed.
AASB 2009-11 Amendments to
Australian Accounting Standards
arising from AASB 9 [AASB 1, 3, 4,
5, 7, 101, 102, 108, 112, 118,
121, 127, 128, 131, 132, 136,
139, 1023 and 1038 and
Interpretations 10 and 12].
This Standard gives effect to
consequential changes arising from the
issuance of AASB 9.
Beginning
1 Jan 2013.
Detail of impact is
still being assessed.
AASB 2009-12 Amendments to
Australian Accounting Standards
[AASB 5, 8, 108, 110, 112, 119,
133, 137, 139, 1023 and 1031
and Interpretations 2, 4, 16, 1039
and 1052].
This Standard amends AASB 8 to require
an entity to exercise judgement in
assessing whether a government and
entities known to be under control of
that government are considered a single
customer for purposes of certain
operating segment disclosures.
Beginning
1 Jan 2011.
Not applicable.
This Standard also makes numerous
editorial amendments to other AASs.
AASB 2009-14 Amendments to
Australian Interpretation-
Prepayments of a Minimum
Funding Requirement [AASB
Interpretation 14].
Amendment to Interpretation 14 arising
from the issuance of prepayments of a
minimum funding requirement.
Beginning
1 Jan 2011.
Not applicable.
AASB 2010-2 Amendments to
Australian Accounting Standards
arising from Reduced Disclosure
Requirements.
This Standard makes amendments to
many Australian Accounting Standards,
including Interpretations, to introduce
reduced disclosure requirements.
Beginning
1 Jul 2013.
Does not
affect financial
measurement or
recognition, so is not
expected to have any
impact on financial
result or position.
May reduce some
note disclosures in
financial statements.
50
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
Standard/Interpretation Summary Applicable for
annual reporting
periods beginning
on or after
Impact on financial
statements
AASB 2010-4 Further Amendments
to Australian Accounting
Standards arising from the Annual
Improvements Project [AASB 1,
AASB 7, AASB 101 and AASB 134
and Interpretation 13].
This Standard makes numerous
improvements designed to enhance the
clarity of standards.
Beginning
1 Jan 2011.
No significant impact
on the financial
statements.
AASB 2010-5 Amendments to
Australian Accounting Standards
[AASB 1, 3, 4, 5, 101, 107, 112,
118, 119, 121, 132, 133, 134,
137, 139, 140, 1023 & 1038 and
Interpretations 112, 115 127, 132
& 1042].
This amendment contains editorial
corrections to a range of Australian
Accounting Standards and
Interpretations, which includes
amendments to reflect changes made to
the text of IFRSs by the IASB.
Beginning
1 Jan 2011.
No significant impact
on the financial
statements.
AASB 2010-6 Amendments to
Australian Accounting Standards
– Disclosures on Transfers of
Financial Assets [AASB 1 and
AASB 7].
This amendment adds and changes
disclosure requirements about the
transfer of financial assets. This includes
the nature and risk of the financial
assets.
Beginning
1 Jul 2011.
Detail of impact is still
being assessed.
AASB 2010-7 Amendments to
Australian Accounting Standards
arising from AASB 9 (December
2010) [AASB 1, 3, 4, 5, 7, 101,
102, 108, 112, 118, 120, 121,
127, 128, 131, 132, 136,
137, 139, 1023 & 1038 and
Interpretations 2, 5, 10, 12,
19 & 127].
These amendments are in relation to the
introduction of AASB 9.
Beginning
1 Jan 2013.
Detail of impact is still
being assessed.
AASB 2010-8 Amendments to
Australian Accounting Standards
– Deferred Tax : Recovery of
Underlying Assets [AASB 112].
This amendment provides a practical
approach for measuring deferred tax
assets and deferred tax liabilities when
measuring investment property by
using the fair value model in AASB 140
Investment Property.
Beginning
1 Jan 2012.
Not applicable.
FINANCIAL STATEMENTS
51

NOTES TO THE FINANCIAL STATEMENTS
Standard/Interpretation Summary Applicable for
annual reporting
periods beginning
on or after
Impact on financial
statements
AASB 2010-9 Amendments to
Australian Accounting Standards
– Severe Hyperinflation and
Removal of Fixed Dates for First
–time Adopters [AASB 1].
This amendment provides guidance
for entities emerging from severe
hyperinflation who are going to resume
presenting Australian Accounting
Standards financial statements or
entities that are going to present
Australian Accounting Standards
financial statements for the first time.
It provides relief for first-time adopters
from having to reconstruct transactions
that occurred before their date of
transition to Australian Accounting
Standards.
Beginning
1 July 2011.
Amendment unlikely
to impact on public
sector entities.
AASB 2011-1 Amendments to
Australian Accounting Standards
arising from the Trans-Tasman
Convergence Project [AASB 1,
AASB 5, AASB 101, AASB 107,
AASB 108, AASB 121, AASB 128,
AASB 132 & AASB 134 and
Interpretations 2, 112 & 113].
This amendment affects multiple
Australian Accounting Standards and
AASB Interpretations for the objective of
increased alignment with IFRSs and
achieving harmonisation between both
Australian and New Zealand Standards.
It achieves this by removing guidance
and definitions from some Australian
Accounting Standards, without changing
their requirements.
Beginning
1 July 2011.
This amendment will
have no significant
impact on public
sector bodies.
AASB 2011-2 Amendments to
Australian Accounting Standards
arising from the Trans-Tasman
Convergence Project – Reduced
Disclosure Requirements [AASB
101 & AASB 1054].
The objective of this amendment is to
include some additional disclosure from
the Trans-Tasman Convergence Project
and to reduce disclosure requirements
for entities preparing general purpose
financial statements under Australian
Accounting Standards – Reduced
Disclosure Requirements.
Beginning
1 July 2013.
The Victorian
Government is
currently considering
the impacts of
Reduced Disclosure
Requirements (RDRs)
and has not decided if
RDRs will be
implemented to the
Victorian Public
Sector.
52
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
Standard/Interpretation Summary Applicable for
annual reporting
periods beginning
on or after
Impact on financial
statements
AASB 2011-3 Amendments to
Australian Accounting Standards
– Orderly Adoption of Changes to
the ABS GFS Manual and Related
Amendments [AASB 1049].
This amends AASB 1049 to clarify the
definition of the ABS GFS Manual, and to
facilitate the adoption of changes to the
ABS GFS Manual and related
disclosures.
Beginning
1 July 2012.
This amendment
provides clarification
to users on the version
of the GFS Manual to
be used and what to
disclose if the latest
GFS Manual is not
used.
No impact on
performance
measurements will
occur.
AASB 124 Related Party
Disclosures (Dec 2009).
Government related entities have been
granted partial exemption with certain
disclosure requirements.
Beginning
1 Jan 2011.
Detail of impact is
still being assessed.
AASB 1053 Application of Tiers of
Australian Accounting Standards.
This Standard establishes a differential
financial reporting framework consisting
of two tiers of reporting requirements
for preparing general purpose financial
statements.
Beginning
1 Jul 2013.
The Victorian
Government is
currently considering
the impacts of
Reduced Disclosure
Requirements (RDRs)
for certain public
sector entities and has
not decided if RDRs
will be implemented
to the Victorian Public
Sector.
FINANCIAL STATEMENTS
53

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 2 INCOME
(a) Revenue
Fare-box revenue 77,493 72,218
Inter-operator income 1,058 1,038
Franchise subsidy 257,000 244,370
State subsidy 12,000 11,700
Access charges 4,199 3,371
Other income 20,488 10,822
Trains received free of charge 38,756 33,024
410,994 376,543
(b) Other income
Interest – other persons / corporation 1,407 590
Government project reimbursement revenue 94,911 86,425
Capital transfer reallocation 6,779 12,242
103,097 99,257
Total income 514,091 475,800
NOTE 3(a) OPERATIONAL EXPENSES
Franchise performance penalty 2,482 146
Other direct costs 5,845 5,200
Fleet maintenance 67,232 69,521
Fuel costs 24,136 20,913
Road coach services 6,277 5,172
Access charges 16,589 16,723
Repairs & maintenance 9,418 6,809
131,979 124,484
Direct labour costs
Salaries and wages 110,947 108,549
Superannuation 11,971 10,618
Annual leave and long service leave expense 5,435 2,560
Other on-costs (fringe benefits tax, payroll tax and work cover levy) 7,642 6,156
135,995 127,883
Total operational expenses 267,974 252,367
(b) DEPRECIATION OF NON-CURRENT ASSETS
Depreciation of non-current assets
Plant and equipment 1,236 1,478
Leasehold improvements 392 394
Rolling stock 9,846 12,515
Rolling stock – capitalised improvements 1,807 4,640
13,281 19,027
54
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 4 INCOME TAX
(a) Income tax expense/(revenue)
Accounting profit / (loss) before income tax 17,955 14,161
Prima facie tax payable on profit from ordinary activities
before income tax at 30% (2010: 30%) 5,387 4,248
Tax expense relating to non-temporary differences 1 1
5,388 4,249
Deferred tax expense relating to reversal of temporary differences (166) 1,052
Recognition of carry forward losses previously not recognised – (7,080)
Income tax expense/(revenue) 5,222 (1,779)
The component of tax expense (revenue) comprises;
Current tax – –
Deferred tax 5,222 (1,779)
5,222 (1,779)
(b) Deferred tax liability
Gross deferred tax assets – temporary differences
Carry forward tax losses 18,387 21,893
Accruals 679 190
Provision for employee entitlements 17,455 16,929
Other provisions 1,792 1,307
Total deferred tax assets 38,313 40,319
Deferred tax liability
Accelerated depreciation for taxation purposes 45,620 42,634
Other 324 94
Total deferred tax liability 45,944 42,728
Net deferred tax liability 7,631 2,409
Movement in deferred tax liability:
Opening balance 2,409 –
Equity – tax effect of asset revaluation – 4,188
Income tax (benefit) expense 5,222 (1,779)
Aggregate deferred tax liability 7,631 2,409
FINANCIAL STATEMENTS
55

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 5 CASH AND CASH EQUIVALENTS
Cash at bank 18,333 9,019
Cash on hand 127 118
18,460 9,137
NOTE 6 RECEIVABLES
Trade receivables 19,680 25,007
Less: provision for impairment (413) (654)
19,267 24,353
Fuel rebate receivables 1,188 898
Other receivables 994 330
21,449 25,581
Related party receivables
Trade receivables include the following receivables from related parties:
- Department of Transport 14,493 20,063
- Other related parties 42 55
14,535 20,118
Terms and conditions relating to the above financial instruments:
Credit sales are on 30 day terms. Details of the terms and conditions of related parties’ receivables are set out in Note 20.
(a) Ageing analysis of contractual receivables
Please refer to Table 1 in Note 14 for the ageing analysis of contractual receivables.
(b) Nature and extent of risk arising from contractual receivables
Please refer to Note 14 for the nature and extent of risks arising from contractual receivables.
2011 2010
$’000 $’000
NOTE 7 INVENTORIES
Spares and materials at cost 6,764 7,046
56
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 8 PROPERTY, PLANT AND EQUIPMENT
Plant and equipment
At cost 30,484 30,216
Accumulated depreciation (26,526) (25,535)
3,958 4,681
Rolling stock
At independent valuation – 30 June 2010 136,017 136,017
Accumulated depreciation (9,846) –
Impairment – –
126,171 136,017
Leasehold improvements
At cost 5,278 5,198
Accumulated amortisation (2,235) (1,843)
3,043 3,355
Rolling stock – capitalised improvements
At cost 15,068 –
Accumulated depreciation (1,807) –
13,261 –
Capital works in progress 16,281 10,485
Total property, plant and equipment 162,714 154,538
Valuation of rolling stock
An independent valuation of all rolling stock was conducted by rolling stock specialists with an effective date of 30 June 2010.
As the market for the rolling stock lacks sufficient depth due to the specialised nature of the assets and the small population
and volume traded, other indirect methods have been used.
The depreciated replacement cost method has been used as the primary method of valuation and has provided a fair value for
the V/Line Pty Ltd rolling stock fleet as at 30 June 2010 of $136 million.
FINANCIAL STATEMENTS
57

NOTES TO THE FINANCIAL STATEMENTS
NOTE 8 PROPERTY, PLANT AND EQUIPMENT CONTINUED
Movement in carrying amounts
The movement in the carrying amounts for each class of property, plant and equipment
between the beginning and the end of the year is as follows.
2011 2010
$’000 $’000
Plant and equipment
Carrying amount at beginning of year 4,681 5,659
Additions 526 500
Disposals (13) (11)
Depreciation expense (1,236) (1,467)
Carrying amount at end of year 3,958 4,681
Rolling stock at valuation
Carrying amount at beginning of year 136,017 98,451
Additions – –
Impairment – –
Disposals – –
Depreciation expense (9,846) (12,515)
Revaluation transfer from rolling stock at cost –
capitalised improvements and capital works in progress – 36,121
Revaluation increment/(decrement) – 13,960
Carrying amount at end of year 126,171 136,017
Leasehold improvements
Carrying amount at beginning of year 3,355 3,646
Additions 80 103
Depreciation expense (392) (394)
Carrying amount at end of year 3,043 3,355
Rolling stock at cost – capitalised improvements
Carrying amount at beginning of year – 13,837
Additions 15,068 10,410
Disposals – –
Depreciation expense (1,807) (4,640)
Revaluation transfer to rolling stock at valuation – (19,607)
Carrying amount at end of year 13,261 –
Capital works in progress
Carrying amount at beginning of year 10,485 15,480
Additions 6,274 12,052
Revaluation transfer to rolling stock at valuation – (16,514)
Transfers to fixed assets (478) (533)
Carrying amount at end of year 16,281 10,485
58
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
Total property, plant and equipment
Carrying amount at beginning of year 154,538 137,073
Additions 21,948 23,065
Disposals (13) (11)
Depreciation expense (13,281) (19,016)
Transfers to fixed assets (478) (533)
Impairment – –
Rolling stock revaluation net increment/(decrement) – 13,960
Carrying amount at end of year 162,714 154,538
NOTE 9 OTHER NON-FINANCIAL ASSETS
Prepayments 675 874
NOTE 10 INVESTMENTS
V/Line Corporation does not own any investments with the exception of
controlled ownership of V/Line Pty Ltd as detailed in note 1(c).
NOTE 11 PAYABLES
Trade payables 13,324 19,958
Accruals 19,828 23,975
Deferred income 858 902
Other payables 8,031 7,710
Total Payables 42,041 52,545
Amounts payable to related parties are as follows:
Other related parties 1,793 3,184
1,793 3,184
NOTE 12 PROVISIONS
Short-term provisions
Employee benefits 52,828 52,244
Other provisions (employee related) 4,815 1,130
57,643 53,374
Movement in other provisions:
Opening balance 1,130 1,405
Additional provisions raised during the year 5,326 -
Amounts used (1,641) (275)
Closing balance 4,815 1,130
Long-term provisions
Employee benefits 5,354 4,188
5,354 4,188
FINANCIAL STATEMENTS
59

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 13 EQUITY
Accumulated Losses
Balance at the beginning of the year (30,025) (45,965)
Net profit / (loss) 12,733 15,940
Balance at the end of the year (17,292) (30,025)
Asset revaluation reserve
Balance at the beginning of the year 114,685 104,913
Revaluation increment / (decrement) (net of tax effect of $4,188) – 9,772
Balance at the end of the year 114,685 114,685
NOTE 14 FINANCIAL INSTRUMENTS
(a) Financial risk management, objectives and policies
The Corporation’s financial instruments consist mainly of deposits with banks, accounts receivable and payable,
loans to and from subsidiaries, and leases. The main purpose of non-derivative financial instruments is to raise
finance for group operations.
The group does not have any derivative instruments as at 30 June 2011.
A finance committee consisting of senior executives of the group meet on a regular basis to consider currency and
interest rate exposure and to evaluate treasury management strategies in the context of the most recent economic
conditions and forecasts.
The main risks the Corporation is exposed to through its financial instruments are interest rate risk, liquidity risk
and credit risk.
INTEREST RATE RISK
As at 30 June 2011 the Corporation had no debt. Although cash holdings are subject to interest rate risk,
such holdings are not material.
LIQUIDITY RISK
Liquidity risk is the risk that the Corporation would be unable to meet its financial obligations as and when they fall due.
The Corporation manages liquidity risk by closely monitoring forecast cash flows to ensure that adequate funding is
maintained at all times. Please also refer note 1(e) and 25 for additional commentary.
The Director of Public Transport has agreed to provide the consolidated entity funding to a level sufficient for it to comply
with the solvency requirements under the Corporations Act 2001.
CREDIT RISK
The Corporation’s exposure to credit risk arises from the potential default of a counter party on their contractual obligations
resulting in financial loss to the Corporation.
Credit risk associated with the Corporation’s financial assets is minimal as the main debtor is the Victorian Government.
For debtors other than Government, the Corporation’s policy is to transact with entities that have high credit ratings and to
obtain sufficient collateral or credit enhancements where appropriate. In addition, the Corporation does not engage in
hedging for its contractual financial assets and mainly obtains contractual financial assets that are on fixed interest, except
for cash assets, which are mainly cash at bank.
Provision of impairment for contractual financial assets is calculated based on past experience, and current and expected
changes in client credit ratings.
Credit risk in trade receivables is also managed by enforcing disclosed payment terms and ensuring that debt collection
policies and procedures are followed at all times.
60
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
(b) Net fair values
The carrying amount of financial assets recorded in the balance sheet, net of any allowances for losses, represents
the Corporation’s maximum exposure to credit risk without taking into account the value of any collateral, or other
security obtained.
The carrying amounts of financial assets and financial liabilities approximate their fair values and are shown below;
2011 2010
$’000 $’000
Financial assets
Cash and cash equivalents 18,460 9,137
Trade and other receivables 21,449 25,581
39,909 34,718
Financial Liabilities
Trade and other payables (42,041) (52,545)
Net financial assets (2,132) (17,827)
Table 1: Ageing Analysis of contractual financial assets
2011 Carrying
Amount
Not past due
and not
impaired
Less than
1 month
Past due but not impaired
1–3 3 months –
months 1 year
1–5
years
Impaired
financial
assets
(i) Receivables:
Trade receivables 19,680 15,386 3,359 488 34 – 413
Total 19,680 15,386 3,359 488 34 – 413
2010
(i) Receivables:
Trade receivables 25,007 23,219 915 93 126 – 654
Total 25,007 23,219 915 93 126 – 654
Price risk
The Corporation is not exposed to any material commodity price risk.
Market risk
The Corporation’s exposure to market risk sensitivities at balance date is not considered to be material.
Foreign currency risk
The Corporation is not exposed to fluctuations in foreign currencies.
FINANCIAL STATEMENTS
61

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 15 CASH FLOW INFORMATION
a) Reconciliation of operating profit/(loss) after tax to net
cash flows from operations
Operating profit / (loss) after tax 12,733 15,940
Non-cash flows in profit / (loss)
Depreciation 13,281 19,027
Tax expense/(benefit) 5,222 (1,779)
Change in operating assets and liabilities
(Increase) / decrease in trade and other receivables 4,132 (1,227)
(Increase) / decrease in inventories 282 (2,274)
(Increase) / decrease in prepayments 199 (190)
(Decrease) / increase in trade and other payables (10,504) (3,173)
(Decrease) / increase in employee benefits 5,435 2,560
Net cash from / (used in) operating activities 30,780 28,884
(b) Reconciliation of cash
Cash balance comprises:
– Cash at bank 18,333 9,019
– Cash on hand 127 118
18,460 9,137
NOTE 16 RESPONSIBLE PERSONS
In accordance with the Ministerial Directions issued by the Minister for Finance under the Financial Management Act 1994,
the following disclosures are made regarding responsible persons for the reporting period.
The names of persons who were responsible persons at any time during the financial year were:
Responsible ministers:
Minister for Public Transport The Hon. Martin Pakula MP 1 Jul 2010 to 1 Dec 2010
Minister for Public
Transport & Roads The Hon. Terry Mulder MP 2 Dec 2010 to 30 Jun 2011
Treasurer Mr John Lenders MLC 1 Jul 2010 to 1 Dec 2010
Treasurer The Hon. Kim Wells MP 2 Dec 2010 to 30 Jun 2011
Accountable officer:
The person who held the position of Accountable Officer during the year ended 30 June 2011 was;
Chief Executive Officer Mr R J Barnett 1 Jul 2010 to 30 Jun 2011
Directors of the board:
The Directors of the parent entity during the year ended 30 June 2011 were;
Mr Frank A. Tait
Mr Michael D. Tilley
Ms Fiona Bennett
Mr David Worth
Ms Moana Weir (Appointed 1st October 2010)
Mr Jack Diamond (Appointed 1st October 2010)
Ms Susan Oliver (Appointed 1st October 2010)
All Directors listed above were as at 30 June 2011 Directors of V/Line Pty Ltd which forms part of the consolidated entity.
Mr Michael D. Tilley, Miss Fiona Bennett and Mr David Worth ceased to be Directors of V/Line Corporation from 1 July 2011
and also resigned as Directors of V/Line Pty Ltd on 1 July 2011.
62
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 17 REMUNERATION OF DIRECTORS AND ACCOUNTABLE OFFICER
Income paid or payable, or otherwise made available, in respect of the financial year,
to all Directors and the Accountable Officer, directly or indirectly,
from the entity or any related party. 598 530
The number of Directors and the Accountable Officer whose income
(including superannuation contribution) falls within the following bands:
$10,000 - $19,999 – 1
$20,000 – $29,999 5 3
$30,000 – $39,999 1 –
$40,000 – $49,999 – –
$50,000 – $59,999 – 1
$60,000 – $69,999 1 –
$330,000 – $339,999 – –
$340,000 – $349,999 – –
$350,000 – $359,999 – –
$360,000 – $369,999 – –
$370,000 – $379,999 – 1
$380,000 – $389,999 1 –
8 6
NOTE 18 REMUNERATION OF EXECUTIVES
The number of Executive Officers, other than the Accountable Officer and Directors and their total remuneration during
the reporting period is shown in the table below in their relevant income bands. Base remuneration is exclusive of bonus
payments, long service leave payments, redundancy payments and retirement benefits
Total remuneration
Base remuneration
2011 2010 2011 2010
$100,000 – $109,999 – 1 – –
$110,000 – $119,999 – – – –
$120,000 – $129,999 – – 1 1
$130,000 – $139,999 – 1 – 2
$140,000 – $149,999 – – 1 –
$150,000 – $159,999 1 1 – 1
$160,000 – $169,999 – 1 1 –
$170,000 – $179,999 1 – 1 –
$180,000 – $189,999 – – 2 1
$190,000 – $199,999 1 – 1 1
$200,000 – $209,999 – 1 – 1
$210,000 – $219,999 1 – – –
$220,000 – $229,999 1 – – –
$230,000 – $239,999 – 2 1 1
$240,000 – $249,999 2 1 – –
$250,000 – $259,999 – 1 – –
$260,000 – $269,999 – – – –
$270,000 – $279,999 – – – –
$280,000 – $289,999 1 – – –
Total Numbers 8 9 8 8
Total Amount $1,748,257 $1,733,340 $1,404,694 $1,366,824
FINANCIAL STATEMENTS
63

NOTES TO THE FINANCIAL STATEMENTS
2011 2010
$’000 $’000
NOTE 19 REMUNERATION OF AUDITORS
Amounts received or due and receivable by the auditors:
– audit of the financial statements 72 86
– other services – –
72 86
NOTE 20 RELATED PARTY DISCLOSURES
Related party Nature of transaction Terms and conditions 2011
$
Payments to related parties
Metlink Victoria Pty Ltd
Victorian Rail Track
Department of Transport
Transport Ticketing
Authority
Provision of services for
V/Line customers to access
suburban network.
Provision of communication
services.
The entity was charged
services on a cost
basis only.
Normal commercial
terms and conditions.
Miscellaneous payments made In accordance with the
under the Franchise Agreement. Franchise Agreement.
Reimbursement of Accounts
Receivable staff salary and
wages.
Receipts from related parties
Department of Transport Provides funding to the
Corporation.
Victorian Rail Track Management fee for rent
collection.
In accordance with
agreement between
the parties.
In accordance with the
franchise agreement.
In accordance with
agreement.
Victorian Rail Track Network access charges. In accordance with
agreement.
The parent company did not have any related party transactions within the wholly owned group.
2010
$
2,746,350 2,836,001
11,046,983 9,156,681
2,482,171 145,532
183,087 194,013
269,000,000 256,070,000
25,516 23,666
258,121 219,748
64
V/LINE ANNUAL REPORT 2010–11

NOTES TO THE FINANCIAL STATEMENTS
NOTE 21 OPERATING LEASES AND EXPENDITURE COMMITMENTS
Operating lease commitments
Operating lease commitments primarily relate to the lease of tool of trade vehicles. There are also commercial lease agreements
in relation to tenancy at 570 Bourke Street and 628 Bourke Street, Melbourne. The leases expire in 2014 and 2015 respectively
which include fixed rate increases of between 3% and 5% or market rent reviews at dates specified in the agreements.
Commitments for minimum contractual payments in relation to non-cancellable operating leases are payable as follows.
2011 2010
$’000 $’000
Within one year 6,048 4,888
Later than one year but not later than 5 years 9,402 10,860
Later than 5 years – –
15,450 15,748
Expenditure commitments
Expenditure commitments primarily relate to the maintenance of all rolling stock
and access charges associated with the metropolitan and regional network.
Commitments in relation to operating expenditure are shown below:
Within one year 147,501 132,755
Later than one year but not later than 5 years 76,373 216,114
Later than 5 years – –
223,874 348,869
FINANCIAL STATEMENTS
65

NOTES TO THE FINANCIAL STATEMENTS
NOTE 22 EMPLOYEE BENEFITS AND SUPERANNUATION COMMITMENTS
(a) Employee benefits
The aggregate employee benefit liability is comprised of:
2011 2010
$’000 $’000
Accrued wages, salaries and on-costs 5,105 4,167
Short-term provisions (current) 57,643 53,374
Long term provisions (non-current) 5,354 4,188
68,102 61,729
(b) Superannuation
Prior to the original Franchise Agreement, the majority of the consolidated entity’s staff were members of Emergency Services
& State Super (ESSS) (formally Government Superannuation Office) funds.
The State organised funds include the Revised Scheme, New Scheme and the Transport Superannuation Fund, which are all
defined benefits schemes. These schemes are ‘master funds’ comprising a large number of participating members, therefore,
are not controlled by the consolidated entity.
With effect from 29 August 1999, employees were given the opportunity to remain in the ESSS funds or to change to either V/
Line’s default superannuation fund (VicSuper) or a superannuation fund of the employee’s choice under the Choice of Fund
legislation. These funds are accumulation funds.
The consolidated entity has not recognised any unfunded superannuation liabilities as the State Government has guaranteed
to undertake this liability from the commencement of the original franchise in 1999. Any unfunded liabilities that may arise
subsequent to the new franchise are calculated annually by ESSS and paid by V/Line at the end of the financial year
(c) Superannuation schemes contributions
and liabilities
Contribution
for the year
2011
($’000)
Contribution
for the year
2010
($’000)
Contribution
outstanding
at year end
2011
($’000)
Contribution
outstanding
at year end
2010
($’000)
Total superannuation contributions 13,922 12,261 1,077 1,426
66
V/LINE ANNUAL REPORT 2010–11

NOTE 23 CONTINGENT ASSETS AND CONTINGENT LIABILITIES
Prior to 30 June 2011, there had been a number of incidents and events on the network such as the floods on the freight
network in Central to Northern Victoria that caused significant damage to either rolling stock or infrastructure. Under the
Franchise Agreement V/Line is required to repair the damage sustained and recover the costs associated with the repairs as
well as any other incidental costs from the Director of Public Transport. As a result, V/Line’s maximum exposure is limited by
the excess stated in the insurance policy that the Department of Transport has with the insurer.
On 28 May 2008, the EPA issued V/Line with a Clean Up Notice in relation to contamination on railway land in Ararat that is
adjacent to a former gasworks site which is being remediated. A Clean Up Plan has been finalised for the site with costs
estimated to be less than $1 million. V/Line as the occupier of the land and the recipient of the Notice is managing the
remediation. However, as the contamination pre-dates V/Line’s lease, V/Line expects to recover these expenses from the
Director of Public Transport under the terms of its Regional Infrastructure Lease.
On 18 November 2008 the EPA issued V/Line with a Pollution Abatement Notice in relation to discharge into a stormwater
drain from the refuelling of trains at Traralgon. V/Line identified a fuelling defect in some of its rolling stock. A modification
program has been undertaken to rectify the defect. V/Line has recovered some costs from the manufacturer. As a result of an
independent environmental audit, V/Line is required to undertake a soil, surface water and ground water monitoring program
for at least the next two years at a cost of approximately $36,000 per annum.
NOTE 24 SUBSEQUENT EVENTS
There are no events subsequent to balance date.
NOTE 25 ECONOMIC DEPENDENCY
The consolidated entity provides public transport services to rural and regional Victoria and is also responsible for the
management and maintenance of the rail network. The provision of these services is subsidised by the State Government of
Victoria. Without the provision of that subsidy the consolidated entity could not continue as a going concern. The subsidy
requirements for the year ending 30 June 2012 have been approved by the State. The consolidated entity’s three year
business plan has also been approved by the Director of Public Transport pursuant to the Franchise Agreement.
NOTE 26 DIVIDENDS
No dividends were paid, declared or recommended during the year, or subsequent to the year end.
FINANCIAL STATEMENTS
67

Independent auditor’s report
68
V/LINE ANNUAL REPORT 2010–11

INDEPENDENT AUDITOR’S REPORT
69

V/Line’s Statement of Corporate Intent
V/LINE MISSION
To provide value for our
customers and community
by delivering safe, reliable,
accessible and sustainable
passenger and rail freight
transport services
V/LINE VISION
Connecting Victorian
communities and industry
as part of an integrated
transport system
V/LINE VALUES
Put our customers first,
Be honest,
Take responsibility,
Strive for excellence, and
Treat people and the
environment with respect
With SAFETY being paramount
in all we do
V/Line operates Victoria’s regional passenger rail services on lines to:
• Geelong and Warrnambool
• Melton and Bacchus Marsh, Ballarat, Ararat and Maryborough
• Sunbury, Kyneton, Bendigo, Swan Hill and Echuca
• Seymour, Albury and Shepparton
• The Latrobe Valley, Sale and Bairnsdale.
V/Line manages the interface with 600 regional coach services.
It leases and maintains the regional rail network and provides access to rail freight operators.
V/Line’s business objectives and strategic agenda are to:
• continuously improve safety and security in all aspects of its operations and business
• be trusted to advance and represent the interest and prosperity of regional Victoria
• be recognised by the government as demonstrating strong governance, efficient operations and
financial responsibility
• sustainably grow patronage and freight volumes year on year
• improve service delivery year on year
• have a reputation for excellent service which contributes to customer satisfaction levels that remain
the highest among Victorian transport operators and access managers
• be recognised as an employer of choice in the Australian rail industry, with a positively motivated,
engaged and skilled workforce, and
• be a trusted representative of regional communities on transport services that link the state
and drives sustainable outcomes.
70
V/LINE ANNUAL REPORT 2010–11

V/Line’s key performance indicators and measures are set out below:
STRATEGIC AGENDA AND CORPORATE KPIs
Safety and security
• Signals passed at danger (SPADs)
• Incidents to customers
• Lost time injury frequency rate (LTIFR)
• Days lost due to lost time injury
• Number of controllable train derailments
Retain and grow reputation
• Stakeholder satisfaction index
Shareholder satisfaction and financial responsibility
• Subsidy per passenger trip
• Gross farebox per passenger trip
Grow the business
• Passenger trips (millions) - rail and coach
• Freight traffic – gross tonne kilometres (GTKs)
‘On time’ and ‘in full’ service delivery
Passenger trains
• Punctuality – percentage on time (to 5 and 10 minutes)
• Reliability – percentage scheduled services delivered
Freight trains
• Punctuality – percentage on time to 10 minutes
Network
• Temporary speed restrictions
– Passenger network
– Freight network
Customer satisfaction
• V/Line customer (passenger) satisfaction index
• Customer experience index
• Complaints/compliments index (per million)
• Load standard
Employee satisfaction and wellbeing
• Employee satisfaction index
• Staff turnover
• Absenteeism
Community and environmental responsibility
• Environmental
• Greenhouse emissions per passenger km
• Sustainability index (under development)
V/Line has developed a suite of corporate initiatives to support its Strategic Agenda in a context of ongoing patronage growth
and additional fleet coming into service. Key initiatives relate to improving efficiency and effectiveness through both internally
and DOT generated initiatives to improve cost efficiency, asset reliability, service quality and safety.
V/Line will also work to ensure the successful implementation of Government initiatives including the New Ticketing Solution,
the North East Rail Revitalisation Project, Sunbury Electrification and Regional Rail Link.
V/Line prepares its accounts in accordance with generally accepted accounting principles incorporating the Australian
Accounting Standards, the Financial Management Act 1994 and the requirements of the Director of Public Transport.
In accordance with the requirements of V/Line’s Franchise Agreement, regular reports covering all areas of V/Line’s business
are provided to the Director of Public Transport. As a State Owned Entity, V/Line also provides performance reports to the
Department of Treasury and Finance
71

Disclosure index
The annual report of V/Line is prepared in accordance with all relevant Victorian legislation.
This index has been prepared to identify compliance with statutory disclosure requirements.
Report of Operations
FRD 30 Requirements for the design and print of annual reports Throughout
Charter and purpose
FRD 22B Manner of establishment and the relevant Ministers 2, 3, 38, 62
FRD 22B Objectives, functions, powers and duties 2, 5, 12-14, 38
FRD 22B Nature and range of services provided 2-14
Management and structure
FRD 22B Organisational structure 35
Financial and other information
FRD 29 Workforce data disclosures 26-27
FRD 22B Occupational health and safety 14-16
FRD 15B Executive officer disclosures 35, 63
FRD 21A Responsible person and executive officer disclosures in the Financial Report 62-63
FRD 22B Summary of the financial results for the year 13, 33
FRD 22B Significant changes in financial position during the year 33
FRD 22B Major changes or factors affecting performance 6-10
FRD 22B Subsequent events 67
FRD 22B Application and operation of Freedom of Information Act 1982 37
FRD 22B Compliance with building and maintenance provisions of Building Act 1993 37
FRD 25 Victorian Industry Participation Policy disclosures 38
FRD 22B Statement on National Competition Policy 37
FRD 22B Application and operation of the Whistleblowers Protection Act 2001 37
FRD 22B Details of consultancies over $100,000 33
FRD 22B Details of consultancies under $100,000 33
FRD 12A Disclosure of major contracts N/A
FRD 24C Reporting of office-based environmental impacts 22-25
FRD 22B Statement of availability of other information 38
FRD 10 Disclosure index 72
FRD 22B Summary of environmental performance 22-25
FINANCIAL STATEMENTS
Financial statements required under Part 7 of the FMA
SD 4.2(f) Financial report 39-67
SD 4.2(b) Operating statement 41
SD 4.2(b) Balance sheet 42
SD 4.2(a) Statement of changes in equity 43
SD 4.2(b) Cash flow statement 43
SD 4.2(c) Accountable officer’s declaration 40
SD 4.2(c) Compliance with Australian accounting standards and other authoritative pronouncements 44
SD 4.2(c) Compliance with Ministerial directions 40
SD 4.2(d) Rounding of amounts 44
SD 4.5.5 Risk management compliance attestation 38
LEGISLATION
Freedom of Information Act 1982 37
Whistleblowers Protection Act 2001 37
Victorian Industry Participation Policy Act 2003 38
Building Act 1993 37
Financial Management Act 1994 40, 68-69
Audit Act 1994 68-69
Statement of corporate intent 70-71
72
V/LINE ANNUAL REPORT 2010–11

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V/LINE PTY LTD
ABN 29 087 425 269
GPO Box 5343
Melbourne VIC 3001
HEAD OFFICE/ADMINISTRATION
Level 23, 570 Bourke Street
Melbourne VIC 3000
Telephone (03) 9619 5900
Facsimile (03) 9619 5000
vline.com.au
CUSTOMER INFORMATION,
RESERVATIONS AND SALES
Telephone 136 196
CUSTOMER FEEDBACK
Freecall 1800 800 120
All information correct at time
of printing, September 2011.