The organisation was in dire financial straits having embarked upon an event that caused it to go into a considerable deficit, which its future trading could not under any circumstances allow it to recover from. After an analysis of the situation, it was clear that a financial and structural restructure was required to enable this body to continue to operate and remain a viable part of the Australian Olympic movement.
Negotiations were begun with Creditors and an informal scheme was agreed to individually with each of the creditors, which enabled the sport to repay some of the monies outstanding and ensure that it had the ability to continue in existence. It was clear that had these accommodations not been met with its creditors, the sport would not have been able to continue, this would have severely impacted its ability to compete in world championships and the next Olympics. The sport being a gold medal winning sport, and a major sport worldwide. Concurrent with the accommodation reached with creditors, there was a rationalisation of the activities of the sport and the consequent reduction in the expenses to enable the sport to continue operating and meet the obligations that it had committed to.
In order to reach accommodation with its creditors, the sport had to borrow money with which to pay a one off lump sum payment in final settlement of all creditors' claims. This loan had to be repaid from ongoing trading activities. This crisis resulted in the onset of major structural reform in the sport, culminating in proposals of an integrated governance model. This model is now being piloted and could become the model for all other sports to follow. The Australian Sports Commission is monitoring the restructuring of this sport with a view to assisting other similarly troubled sports in overcoming their structural and financial difficulties. The sport has achieved a turnaround in that it will have repaid its loans and be in an asset positive position by the end of this year and with the anticipated structural reforms, could become a very viable and strong entity delivering a higher level of service to the sport throughout Australia.