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Part 4 : Financial Performance

Financial discussion

19992000 was the first year the Department operated under the accrual-based outcomes and outputs framework. Previously, appropriations were based on the cash requirements of the Department, but under the new framework, they reflect the full accrual price of outputs and the administered programs. For the resource summary of the Departments price of outputs and administered programs, see Resource Summary Tables in section 4.2 of this report.

Operating result

Departmental

The operating surplus for 19992000 was $24.5 million after extraordinary items. This represented a $50 million improvement from 199899 (due to increased appropriation revenue) and a $7 million improvement on the 19992000 Budget (as reflected in the 19992000 Portfolio Additional Estimates Statements). The operating surplus has been returned to the Government via payment of a capital use dividend of $27.1 million.

A summary of the 19992000 result in comparison with the 199899 result and the 19992000 budget is provided in the following table.

Result
$000

Variation on 199899 (%)

Budget
$000

Variation on
Budget (%)

Appropriation for outputs

187 205

36

185 510

1

Other revenues

11 803

57

9 192

28

Total Revenue

199 008

37

194 702

2

Employee expenses

64 856

21

56 090

16

Supplier expenses

81 712

-7

101 231

-19

Other expenses

27 937

0

19 871

40

Total expenses

174 505

3

177 192

-2

Operating result

24 503

102

17 510

42

Total operating revenue of $199 million, up $54 million from 199899 and $4.3 million from the 19992000 Budget, consists of Government appropriations of $187.2 million and own source revenue, comprising sales of goods and services and interest, of $11.8 million. Each of these revenue items increased from the 199899 financial year.

Appropriation revenue increased by $49.7 million from 199899 due to:

  • the 199899 outcome reflected an underspend of $23.4 million that was carried over to 19992000 (appropriated as a capital injection);
  • the 19992000 appropriation reflected the full accrual price of outputs under the new framework; and
  • a new measure to increase support for the Indian Ocean Territories ($6.5 million).

Own source revenue increased by $4.3 million from 199899 and $2.6 million from 19992000 Budget due largely to interest earned under the new Agency Banking arrangements.

Total operating expenses of $174.5 million represented a small increase, (3 per cent) from 199899 as a result of an increase in services to Government, but were marginally ($2.7 million) below budget. The main items comprising total operating expenses, employee expenses ($64.9 million, up 21 per cent) and payments to suppliers ($81.7 million, down 7 per cent) vary considerably from 199899 and 19992000 Budget due to reclassification of expenses between the two items.

Administered

The Department in 19992000 administered programs with a budget of $2569.9 million.

The operating surplus for administered programs for 19992000 was $45.3 million after extraordinary items. This represented a $104.6 million improvement from the 19992000 Budget, attributable to lower than budgeted operating expenses and transfers to the Official Commonwealth Public Account.

A summary of budget and actual expenditure by appropriation is provided in the following table.

Administered appropriations 19992000
Budget
$000
19992000
Actual
expenses
$000
Appropriation acts 1 and 3 129 673 105 281
Appropriation acts 2 & 4 246 648 176 035
Special appropriations 2 126 266 2 227 000
Special accounts 67 360 11 254
Total administered expenses 2 569 947 2 519 570

Total operating revenue for 19992000 was $2769.8 million, a $24.6 million improvement against Budget. This is largely due to increased appropriation revenue, up $68.3 million to $2578.9 million, due to the full recognition of revenue for administered programs not recognised at the time of the budget. This was offset by a reduction in:

  • the recognition of appropriation revenue due to reduced program expenses ($50.4 million), and
  • dividends ($40.4 million) due to the deferment of dividends from Australian National to 200001, and the transfer of Sydney Airport Corporation Ltd dividends to the Department of Finance and Administration.

Total operating expenses of $2519.6 million represented a $50.4 million decrease against budget, due to delays in the signing of agreements and the reprofiling of program expenses from 19992000 to 200001 and later years.

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Balance Sheet

Departmental

The Departments net equity position declined marginally to $219.2 million, representing a decrease of $0.9 million from 199899. This decline is as a result of reductions in:

  • accumulated results ($10.9 million) due to transitional adjustments and payment of a capital use dividend that exceeded net operating surplus; and
  • reserves ($7.4 million) due to the revaluation of assets.

The impact of these adjustments was offset by capital injections of $17.4 million for appropriation of the previous years carryover.

Total assets increased by $8.8 million during 19992000 to $252.7 million due to an increase in cash and investments of $36 million under the agency banking arrangements. Offsetting this increase were reductions in:

  • appropriation receivables of $11.9 million; and

Graph: Departmental Assets as at 30 June 2000

  • land and buildings of $9.7 million and infrastructure, plant and equipment of $7.2 million due to revaluation adjustments and disposal of assets.

Total liabilities increased by $9.7 million from 199899 to $33.6 million. The Departments primary liability continues to be employee provisions, as a result of accruing leave entitlements for staff. This liability increased by $2.5 million to $23.6 million. The remaining increase in liabilities is due to increases in accrued supplier expenses ($4.8 million) and leases ($1 million).

Administered

The administered net equity position improved considerably against the budget, increasing by $120.8 million to $1953.9 million as a result of the improved operating surplus.

Total administered assets increased by $192.6 million over budget to $2 140.5 million mostly due to a $358.7 million increase in receivables for annual appropriations, offset by a $219 million reduction in investments due to the reclassification of Federations Funds projects as a receivable.

Total administered liabilities were $186.6 million, representing an increase of $71.8 million against budget due to an increase in subsidies payable by administered programs.

Graph: Administered Assets as at 30 June 2000

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4.1. Cash flow statement

Departmental

Graph: Departmental Net Cash Flows

The Department increased its cash balance by $36 million during the year, primarily due to net cash inflows from operating activities of $53 million. The cash is required to fund ongoing operating activities across the Department and the purchase of property, plant and equipment to maintain the delivery of services to the Indian Ocean Territories.

Administered

Graph: Administered Net Cash Flows

The administered cash balance increased to $24.5million, $23.8 million greater than budget, attributable to net cash inflows from operating activities of $10.6 million and financing activities of $10.3 million. Administered cash is held at year-end to acquit closing creditors due and payable early in the new financial year.

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Resource summary tables

Download the Resource summary tables [PDFPDF: 14 KB] as Adobe Acrobat PDF file.

Document description:

  • 1.1 Services to communities
  • 1.2 Grants to States/Territories and Local Government
  • 2.1 Services for industry and economic development
  • 2.2 Grants to States/Territories and local government

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