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Statement 12: Australian Accounting Standard No. 31
Financial Statements

Contents

AAS31 financial statements 12-4

Notes to the AAS31 financial statements 12-7

Appendix A: Additional agency statistics 12-14

Estimates of general government sector agency capital use charge and dividend payments 12-30

The financial tables presented in this Statement have been prepared on an accrual basis in accordance with applicable Australian Accounting Standards, including Australian Accounting Standard No. 31 Financial Reporting by Governments (AAS31), except where departures from the standard are identified in Note 1.

A reconciliation between the Commonwealth's general government AAS31 and Government Finance Statistics (GFS) revenue, expenses and operating results is provided in Statement 10.

Table 1: Statement of revenue and expenses for the Commonwealth general government sector - AAS31

Table 1: Statement of revenue and expenses for the Commonwealth general government sector - AAS31

Table 2: Balance sheet for the Commonwealth general
government sector - AAS31

Table 2: Balance sheet for the Commonwealth general

Table 3: Statement of cash flows for the Commonwealth general government sector - AAS31

Table 3: Statement of cash flows for the Commonwealth general government sector - AAS31

Notes to the AAS31 financial statements

Note 1: External reporting standards

The Charter of Budget Honesty Act 1998 requires that the budget be based on external reporting standards and that departures from applicable external reporting standards be identified.

The financial statements included in this Statement have been prepared on an accrual basis in accordance with applicable Australian accounting standards, including Australian Accounting Standard No. 31: Financial Reporting by Governments (AAS31). AAS31 is the relevant accounting standard for financial reporting by governments.

AAS31 requires adoption of the full accrual basis of accounting. This means that assets, liabilities, revenues and expenses are recorded in financial statements when they have their economic impact on the government, rather than when the cash flow associated with these transactions occurs. Consistent with AAS31, an operating statement, a balance sheet and a statement of cash flows have been prepared using estimates for the budget year and the three forward years.

The accounting policies in this budget document are generally consistent with the accounting policies in AAS31. While the scope for financial reporting recommended in AAS31 is the Whole of Government (that is, the Commonwealth public sector), in accordance with the Charter of Budget Honesty Act 1998, the budget presentation of financial estimates covers the general government sector only.

In relation to taxation revenue, AAS31 suggests revenue be recognised at the time the income (or economic activity) giving rise to a tax liability occurs, where this can be measured reliably. At this stage, the Commonwealth does not consider its taxation revenues can be reliably measured on this basis for budget reporting purposes. Taxation revenue is therefore recognised at the time a taxpayer makes a self-assessment or when the Australian Taxation Office (ATO) or the Australian Customs Service (ACS) raises a tax assessment.

In regard to goods and services tax (GST) revenue, AAS31 and other relevant accounting standards would suggest the gross amount of GST be included in the Commonwealth's Financial Statements. However, the clear policy intent of the Intergovernmental Agreement on the Reform of Commonwealth-State Financial Relations (IGA) is that the GST is a State tax collected by the Commonwealth in an agency capacity. Therefore, accrued GST revenues and associated payments to the States and Territories are not recorded in the budget financial statements.

Note 2: Reconciliation of cash

Note 2: Reconciliation of cash

Note 3: Income tax revenue - accrual AAS31

Note 3: Income tax revenue - accrual AAS31

Note 4: Indirect tax revenue - accrual AAS31

Note 4: Indirect tax revenue - accrual AAS31

Note 5: Interest and dividend revenue

Note 5: Interest and dividend revenue

Note 6: Other sources of non-taxation revenue

Note 6: Other sources of non-taxation revenue

Note 7: Employees expenses

Note 7: Employees expenses

(a) Salaries and wages do not include superannuation.

Note 8: Suppliers expenses

Note 8: Suppliers expenses

Note 9: Depreciation and amortisation expenses

Note 9: Depreciation and amortisation expenses

Note 10: Grants expenses

Note 10: Grants expenses

Note 11: Government securities

For 2002-03 and the forward years, transactions relating to government securities and financial assets acquired for debt management purposes have been netted in the balance sheet and cash flows. In the balance sheet, the financial assets - investments category excludes financial assets acquired for debt management purposes, while the debt - government securities category is shown net of financial assets acquired for debt management purposes. Likewise, in the statement of cash flows, the investing activities - cash used - other category excludes cash used to acquire financial assets for debt management purposes.

This netting treatment has been applied because of the considerable uncertainty associated with the split between government securities and financial assets acquired for debt management purposes. Debt management strategies in respect of government securities and financial assets are highly dependent on prevailing market conditions and other factors. The balance to be struck between gross debt retirement and financial asset acquisition cannot be accurately estimated in advance.

Note 12: Total non-financial assets

Note 12: Total non-financial assets

Note 13: Employee liabilities

Note 13: Employee liabilities

Note 14: Grants payable

Note 14: Grants payable

Note 15: Net asset movements

Note 15: Net asset movements

Note 16: Tax receipts - cash AAS31

Note 16: Tax receipts - cash AAS31

Appendix A: Additional agency statistics

Table A1: General government expenses by agency

Table A1: General government expenses by agency

Table A1: General government expenses by agency (continued)

Table A1: General government expenses by agency (continued)

Table A1: General government expenses by agency (continued)

Table A1: General government expenses by agency (continued)

(a) Estimates of inter-agency transactions are included in the Whole of Government and inter-agency amounts. The entry for each portfolio does not include eliminations for inter-agency transactions within that portfolio.

Table A2: Departmental expenses by agency

Table A2: Departmental expenses by agency

Table A2: Departmental expenses by agency (continued)

Table A2: Departmental expenses by agency (continued)

Table A2: Departmental expenses by agency (continued)

Table A2: Departmental expenses by agency (continued)

Table A3: Net capital investment by agency

Table A3: Net capital investment by agency

Table A3: Net capital investment by agency (continued)

Table A3: Net capital investment by agency (continued)

Table A3: Net capital investment by agency (continued)

Table A3: Net capital investment by agency (continued)

(a) Estimates of inter-agency transactions are included in the Whole of Government and inter-agency amounts. The entry for each portfolio does not include eliminations for inter-agency transactions within that portfolio.

Table A4: Capital appropriations by portfolio

Table A4: Capital appropriations by portfolio

Table A4: Capital appropriations by portfolio (continued)

Table A4: Capital appropriations by portfolio (continued)

Table A4: Capital appropriations by portfolio (continued)

Table A4: Capital appropriations by portfolio (continued)

(a) Estimates of inter-agency transactions are included in the Whole of Government and inter-agency amounts. The entry for each portfolio does not include eliminations for inter-agency transactions within that portfolio.

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector (continued)

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector (continued)

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector (continued)

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector (continued)

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector (continued)

Table A5: Estimates of average staffing level (ASL) of agencies in the Commonwealth general government sector (continued)

Note: This table includes estimates of ASL provided by general government sector agencies. ASL figures reflect the average number of employees receiving salary or wages over the financial year, with adjustments for casual and part-time staff, to show the full time equivalent. This also includes non-uniformed staff and overseas personnel.

Estimates of general government sector agency capital use charge and dividend payments

The Commonwealth introduced, as part of the accrual budgeting reforms in 1999-2000, a Capital Use Charge (CUC). The CUC is paid annually by general government sector agencies on their net assets. The CUC is an internal government transaction and, therefore, does not affect the budget balances as the payment is offset by a departmental appropriation.

The CUC was implemented to improve agency resource allocation, by ensuring that the full cost of competing activities are shown and the cost of capital is reflected in the pricing structures of equivalent outputs produced by the public or private sectors.

The Government reduced the CUC levied on agencies' net assets from 12 per cent to 11 per cent on 1 July 2001, reflecting movements in domestic capital and equity markets. The Government has reaffirmed this rate for 2002-03 and agreed to simplify CUC payment arrangements. The annual CUC payment will now be based on the agency's opening net asset position rather than the closing position.

As well as CUC payments, some agencies or parts thereof, which operate on a fully commercial basis, pay annual dividends to the government, which are set having reference to private sector benchmarks. Also, a separate return to government in the form of a special dividend may be made by an agency to return surplus cash. These surpluses can arise where an agency has rationalised non-financial assets, reduced activity or become more efficient.

Table A6: Capital user charge and dividends by agency

Table A6: Capital user charge and dividends by agency

Table A6: Capital user charge and dividends by agency (continued)

Table A6: Capital user charge and dividends by agency (continued)

(a) Agency has negative equity and, therefore, does not make a CUC payment.

(b) Agency pays a special dividend in 2001-02 only.

(c) Agency does not pay a CUC.

(d) Agency makes a dividend payment only.

(e) Agency is exempt from the CUC as its revenue is generated from industry levies.


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