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Part 4: Financial Statements (page 1)

This part contains information on the department's financial performance in 2012–13, including spatial accounting data and the department's financial statements.

Financial Performance

This section provides a summary of the department's financial performance during 2012–13 for both departmental and administered activities. In 2012–13 the department delivered its core ordinary departmental operations on budget. 1

The department's financial statements are presented from page 105 of this report. The Australian National Audit Office issued an unmodified audit opinion of these statements on 30 August 2013.

Departmental activities

Operating result

The department recorded a small operating deficit of $62,000 for its core operations. The department's bottom line in the statement of comprehensive income shows a technical operating loss of $1.1 million. This amount includes unfunded depreciation and amortisation expenses and asset write-downs totalling $5.5 million, 2 less:

  • an upward revaluation of assets—$1.7 million
  • a revaluation of employee liabilities—$0.6 million
  • resources received free of charge—$0.9 million
  • timing differences between revenue and expenses relating to special accounts—$1.3 million.

Balance sheet

In 2012–13 the department reported net equity of $167.5 million: $208.5 million of assets, less $41.0 million of liabilities. Financial assets were $45.8 million, consisting mainly of cash and appropriations receivable. Non-financial assets were $162.7 million, primarily representing the National Portrait Gallery building and art collections.

The government contributed $10.2 million of equity to the department during 2012–13. This included the department's capital budget and the transfer of assets relating to the National Portrait Gallery building from the Department of Finance and Deregulation.

1 Core ordinary departmental operations exclude special accounts, unfunded depreciation and amortisation expenses, assets received free of charge and revaluations of assets and employee liabilities.

2 From 2010–11, the government introduced net cash appropriation arrangements where revenue appropriations for depreciation and amortisation expenses ceased. Entities now receive a separate capital budget provided through equity appropriations.

Administered activities

Income

Administered revenue totalled $60 million, which largely related to services provided to the non-self-governing territories ($34.1 million), interest on loans to state and territory governments ($6.4 million), royalties from the Christmas Island phosphate mine ($1.6 million) and public and education lending rights ($20.1 million).

The revaluation of portfolio entities' land, buildings, heritage and cultural assets resulted in a $58.2 million upward adjustment to the net book value of administered investments. The Christmas Island phosphate mine lease was revalued upward by $2 million based on the estimate of future cash flows. These adjustments were taken to the asset revaluation reserve and reflected in other comprehensive income.

Expenses

The programs that the department administered on behalf of government included:

  • $2,403.4 million to enhance the development of Australia's regions, including payments made under the Local Government (Financial Assistance) Act 1995.
  • $200.7 million in services and support (including $40 million in depreciation) to administer the Australian Government's interest in the self-governing territories
  • $195.1 million to support participation in, and access to, Australia's arts and culture
  • $46.6 million to support improved opportunities for community participation in sport and recreation and excellence in high-performance athletes
  • $669 million in payments to portfolio Commonwealth Authorities and Companies Act 1997 bodies.

Assets

At 30 June 2013, administered assets totalled $8,974.6 million, mainly reflecting the net book value of the portfolio's related entities ($8,184.2 million). Other significant assets included:

  • $96.3 million in loans receivable from states and territories for housing, water and sewerage
  • $70.5 million of land and $163 million of buildings on Christmas Island, the Cocos (Keeling) Islands, Norfolk Island and the National Institute of Dramatic Art building
  • $429.6 million of property, plant and equipment, including $99 million of heritage and cultural assets comprising the Sidney Nolan collection ($64.2 million) and heritage assets on Norfolk Island and Christmas Island ($36.7 million)
  • intangibles of $4.1 million, which mainly relate to the Christmas Island phosphate mine lease
  • inventories of $2 million, comprising power supplies, fuel and electrical supplies.

Liabilities

At 30 June 2013 administered liabilities totalled $60.8 million. Major items included:

  • end-of-year supplier, subsidy and grant payables—$40.6 million
  • special account receipts received in advance of services being provided— $14 million
  • employee provisions relating to staff employed in the Indian Ocean Territories—$2.7 million
  • provision for the removal of asbestos— $0.3 million
  • provision for the rehabilitation of the Christmas Island phosphate mine— $2.4 million.

Spatial accounting

Spatial accounting captures and records expenditure by geographic location under three categories—regional, non-regional and non-specific. Since the 2011–12 Budget, the government has published spatial accounting information in regional ministerial statements, providing greater visibility on levels of expenditure expected to be distributed to regional Australia. Information on spatial accounting expenditure for the current budget year and other Commonwealth portfolios can be found in the Ministerial Statements section of the government's budget website, www.budget.gov.au.

Table 24 compares the estimated expenditure, as reported in the 2012–13 Regional Ministerial Statement, to actual expenditure in 2012–13.

Table 24: Portfolio regional and non-regional estimated and actual expenditure, 2012–13

Table 24: Portfolio regional and non-regional estimated and actual expenditure, 2012–13
Program Category Budget estimate 2012–13 $m (a) Actual expenses 2012–13 $m (b) Variation $m (a-b)
Department of Regional Australia, Local Government, Arts and Sport
Program 1.1: Regional development Regional 121 110 11
Non-regional 34 63 -29
Non-specific 45 0 45
Program 1.2: Local government Regional 814 2,029 -1,215
Non-regional 320 201 119
Non-specific 0 0 0
Program 2.1: Services to territories Regional 99 157 -58
Non-regional 2 2 0
Non-specific 0 0
Program 3.1: Arts and cultural development Regional 48 41 7
Non-regional 29 26 3
Non-specific 46 52 -6
Program 4.1: Sport and recreation Regional 15 14 1
Non-regional 5 15 -10
Non-specific 12 11 1
Total Regional 1,097 2,351 -1,254
Non-regional 390 307 83
Non-specific 103 63 40
Australia Council
Investment in the arts Regional 14 21 -7
Non-regional 0 145 -145
Non-specific 154 9 145
Total Australia Council Regional 14 21 -7
Non-regional 0 145 -145
Non-specific 154 9 145
Australian Sports Commission
Other departmental Regional 10 23 -13
Non-regional 141 166 -25
Non-specific 142 109 33
Total Australian Sports Commission Regional 10 23 -13
Non-regional 141 166 -25
Non-specific 142 109 33
Regional Australia, Local Government, Arts and Sport Portfolio Grand Total Regional 1,121 2,395 -1,274
Non-regional 531 618 -87
Non-specific 399 181 218

The spatial accounting data published in the 2012–13 Regional Ministerial Statement represents estimates from the May 2012 Budget. Variances between budgeted and actual expenses reflect government decisions subsequent to the May 2012 Budget and successful grant applications.

For Program 1.2 (Local Government), the variance represents the first two instalments of the expected 2013–14 local government financial assistance grants to local councils in 2012–13.

Table 25: Agency resource statement

Table 25: Agency resource statement
Actual available appropriation for 2012–13 $'000 (a) Payments made 2012–13 $'000 (b) Balance remaining 2012–13 $'000 (a) – (b)
Ordinary Annual Services1
Prior year departmental appropriation 24,388 22,497 1,891
Departmental appropriation2 101,647 76,618 25,029
s31 relevant agency receipts 12,235 12,235
Total 138,270 111,350 26,920
Administered expenses
Outcome 1: Regional Development and Local Government 212,434 182,503
Outcome 2: Services to Territories3 182,410 149,847
Outcome 3: Arts & Cultural Development4 205,845 199,292
Outcome 4: Sport & Recreation 40,892 35,263
Payments to CAC Act Bodies 668,957 668,957
Total   1,310,538 1,235,862
Total ordinary annual services A 1,448,808 1,347,212
Other services5
Administered expenses
Specific payments to States, ACT, NT and local government
Outcome 1: Regional Development and Local Government 27,487 16,862
Total   27,487 16,862
Departmental non-operating
Equity injections 4,600
Total   4,600
Administered non-operating
Administered Assets and Liabilities 33,632 10,079
Payments to CAC Act Bodies - non-operating 30,742 30,742
Total 64,374 40,821
Total other services B 96,461 57,683
Total Available Annual Appropriations and payments 1,545,269 1,404,895
Special appropriations
Special appropriations limited by criteria/entitlement
Local Government (Financial Assistance) Act 1995 – s19 2,157,759 2,157,759
Total special appropriations C 2,157,759 2,157,759
Special Accounts
Opening balance 14,112
Appropriation receipts 2,555
Non-appropriation receipts to Special Accounts 16,368
Payments made 15,763
Total Special Account D 33,035 15,763 17,272
Total resourcing and payments A+B+C+D 3,736,063 3,578,417
Less appropriations drawn from annual or special appropriations above and credited to special accounts and/or CAC Act bodies through annual appropriations 702,254 702,254
Total net resourcing and payments for agency 3,033,809 2,876,163

1 Appropriation Bill (No.1) 2012–13 and Appropriation Bill (No.3) 2012–13. This may also include Prior Year departmental appropriation and S.31 relevant agency receipts.

2 Includes an amount of $2.87m in 2012–13 for the Departmental Capital Budget. For accounting purposes this amount has been designated as ‘contributions by owners’.

3 Includes an amount of $8.83m in 2012–13 for the Administered Capital Budget. For accounting purposes this amount has been designated as ‘contributions by owners’.

4 Includes an amount of $1.69m in 2012–13 for the Administered Capital Budget. For accounting purposes this amount has been designated as ‘contributions by owners’.

5 Appropriation Bill (No.2) 2012–13 and Appropriation Bill (No.4) 2012–13.

Agency resource statement

Table 26: Resources for Outcome 1

Table 26: Resources for Outcome 1
Outcome 1 Strengthening the sustainability, capacity and diversity of regional economies including through facilitating local partnerships between all levels of government and local communities; and providing grants and financial assistance Budget* 2012–13 $'000 (a) Actual Expenses 2012–13 $'000 (b) Variation 2012–13 $'000 (a) – (b)
Program 1.1: Regional Development
Administered expenses
Ordinary Annual Services (Appropriation Bill No. 1) 189,386 172,833 16,553
Other Services (Appropriation Bill No. 2) 10,625 625 10,000
Departmental expenses
Departmental appropriation 1 38,670 39,297 (627)
Expenses not requiring appropriation in the Budget year 1,080 1,284 (204)
Total for Program 1.1 239,761 214,039 25,722
Program 1.2: Local Government
Administered expenses
Ordinary annual services (Appropriation Bill No. 1) 11,827 10,594 1,233
Other services (Appropriation Bill No. 2) 16,815 16,862 (47)
Special appropriations 2,157,759 2,202,512 (44,753)
Departmental expenses
Departmental appropriation 1 4,130 4,366 (236)
Expenses not requiring appropriation in the Budget year 115 143 (28)
Total for Program 1.2 2,190,646 2,234,477 (43,831)
Outcome 1 Totals by appropriation type
Administered Expenses
Ordinary annual services (Appropriation Bill No. 1) 201,213 183,427 17,786
Other services (Appropriation Bill No. 2) 27,440 17,487 9,953
Special Appropriations 2,157,759 2,202,512 (44,753)
Departmental expenses
Departmental appropriation 1 42,800 43,663 (863)
Expenses not requiring appropriation in the Budget year 1,195 1,427 (232)
Total expenses for Outcome 1 2,430,407 2,448,516 (18,109)
2011–12 2012–13
Average Staffing Level (number) 286 236

* Full year budget, including any subsequent adjustment made to the 2012–13 Budget.

1 Departmental Appropriation combines “Ordinary annual services (Appropriation Bill No. 1)” and “Revenue from independent sources (s31)”.

Table 27: Resources for Outcome 2

Table 27: Resources for Outcome 2
Outcome 2 Good governance in the Australian Territories through the maintenance and improvement of the overarching legislative framework for self-governing territories, and laws and services for non self-governing territories Budget* 2012–13 $'000 (a) Actual Expenses 2012–13 $'000 (b) Variation 2012–13 $'000 (a) – (b)
Program 2.1: Services to Territories
Administered expenses
Ordinary Annual Services (Appropriation Bill No. 1) 161,424 159,215 2,209
Special Accounts 1,529 1,720 (191)
Departmental expenses
Departmental appropriation 1 9,198 9,233 (35)
Expenses not requiring appropriation in the Budget year 33,711 40,034 (6,323)
Total for Program 2.1 205,862 210,202 (4,340)
Outcome 2 Totals by appropriation type
Administered Expenses
Ordinary Annual Services (Appropriation Bill No. 1) 161,424 159,215 2,209
Special Accounts 1,529 1,720 (191)
Departmental expenses
Departmental appropriation 1 9,198 9,233 (35)
Expenses not requiring appropriation in the Budget year 33,711 40,034 (6,323)
Total expenses for Outcome 2 205,862 210,202 (4,340)
2011–12 2012–13
Average Staffing Level (number) 65 50

* Full year budget, including any subsequent adjustment made to the 2012–13 Budget.

1 Departmental Appropriation combines “Ordinary annual services (Appropriation Bill No. 1)” and “Revenue from independent sources (s31)”.

Table 28: Resources for Outcome 3

Table 28: Resources for Outcome 3
Outcome 3 Participation in, and access to, Australia's arts and culture through developing and supporting cultural expression Budget* 2012–13 $'000 (a) Actual Expenses 2012–13 $'000 (b) Variation 2012–13 $'000 (a) – (b)
Program 3.1: Arts and Cultural Development
Administered expenses
Ordinary Annual Services (Appropriation Bill No. 1) 192,102 191,982 120
Special Accounts 500 500
Departmental expenses
Departmental appropriation 1 38,483 37,722 761
Special Accounts 4,211 4,873 (662)
Expenses not requiring appropriation in the Budget year 6,569 6,519 50
Total for Program 3.1 241,865 241,596 269
Outcome 3 Totals by appropriation type
Administered Expenses
Ordinary Annual Services (Appropriation Bill No. 1) 192,102 191,982 120
Special Accounts 500 500
Departmental expenses
Departmental appropriation 1 38,483 37,722 761
Special Accounts 4,211 4,873 (662)
Expenses not requiring appropriation in the Budget year 6,569 6,519 50
Total expenses for Outcome 3 241,865 241,596 269
2011–12 2012–13
Average Staffing Level (number) 112 145

* Full year budget, including any subsequent adjustment made to the 2012–13 Budget.

1 Departmental Appropriation combines “Ordinary annual services (Appropriation Bill No. 1)” and “Revenue from independent sources (s31)”.

Table 29: Resources for Outcome 4

Table 29: Resources for Outcome 4
Outcome 4 Improved opportunities for community participation in sport and recreation, and excellence in high-performance athletes, through initiatives to help protect the integrity of sport, investment in sport infrastructure, coordination of Commonwealth involvement in major sporting events, and research and international cooperation on sport issues. Budget* 2012–13 $'000 (a) Actual Expenses 2012–13 $'000 (b) Variation 2012–13 $'000 (a) – (b)
Program 4.1: Sport and Recreation
Administered expenses
Ordinary Annual Services (Appropriation Bill No. 1) 39,946 39,546 400
Special Accounts 7,069 6,967 102
Departmental expenses
Departmental appropriation 1 9,949 9,139 810
Expenses not requiring appropriation in the Budget year 249 420 (171)
Total for Program 4.1 57,213 56,072 1,141
Outcome 4 Totals by appropriation type
Administered Expenses
Ordinary Annual Services (Appropriation Bill No. 1) 39,946 39,546 400
Special Accounts 7,069 6,967 102
Departmental expenses
Departmental appropriation 1 9,949 9,139 810
Expenses not requiring appropriation in the Budget year 249 420 (171)
Total expenses for Outcome 4 57,213 56,072 1,141
2011–12 2012–13
Average Staffing Level (number) 22 49

* Full year budget, including any subsequent adjustment made to the 2012–13 Budget.

1 Departmental Appropriation combines “Ordinary annual services (Appropriation Bill No. 1)” and “Revenue from independent sources (s31)”.

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