1. Financial Performance

This section analyses the financial performance of the Department for the year ended 30 June 2018.

1.1 Expenses

1.1A: Employee benefits
2017
$'000
2018
$'000
Wages and salaries 94,026 97,798
Superannuation
Defined contribution plans 7,970 8,049
Defined benefit plans 10,416 11,228
Leave and other entitlements 12,337 11,116
Separation and redundancies 3,310 1,824
Other employee expenses 2,082 3,350
Total employee benefits 130,141 133,365
1.1B: Suppliers
2017
$'000
2018
$'000
Goods and services supplied or rendered
Legal 6,054 10,395
Contracted services 28,021 23,457
Consultants 20,772 27,988
Contractors 14,512 11,882
Travel and accommodation 5,027 5,780
Communications 2,532 2,766
Property operating costs 6,825 7,166
Information technology services 4,376 3,643
Training and conferences 2,119 2,621
Other goods and services 7,434 5,350
Total goods and services supplied or rendered 97,672 101,048
Goods supplied 638 954
Services rendered 97,034 100,094
Total goods and services supplied or rendered 97,672 101,048
Other suppliers
Operating lease rentals 12,091 12,807
Workers compensation expenses 437 967
Total other suppliers 12,528 13,774
Total suppliers 110,200 114,822
Leasing Commitments
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows:
Within 1 year 12,316 13,623
Between 1 to 5 years 47,581 50,848
More than 5 years 39,740 53,010
Total operating lease commitments 99,637 117,481
Commitments for sublease rental income receivables are as follow:
Within 1 year 1,921 121
Between 1 to 5 years 6,463 88
More than 5 years 5,301  -
Total sublease rental income commitments 13,685 209

Leasing Commitments

The Department, in its capacity as lessor/lessee, has entered into operating leases for office accommodation purposes. The lease conditions vary and most leases include annual rent reviews with fixed percentage increases. Operating leases are effectively non-cancellable.

1.1C: Grants
2017
$'000
2018
$'000
Local Governments 26 -
Non-profit organisations - 357
Total grants 26 357
Note 1.1D: Finance costs—unwinding of discount
2017
$'000
2018
$'000
Unwinding of provision for restoration 6 17
Total finance costs 6 17
1.1E: Write-down and impairment of assets
2017
$'000
2018
$'000
Impairment of financial instruments - 144
Write-down of leasehold improvements 3,841 74
Write-down other property, plant and equipment 151 67
Impairment of intangible assets 361 188
Total write-down and impairment of assets 4,353 473

Accounting Policy

Employee Benefits

Accounting policies for employee related expenses are contained in the People and Relationships section
(Note 6.1).

Leases

Operating lease rental expenses are net of sub-lease revenue where applicable.

Operating lease payments are expensed on a straight line basis which is representative of the pattern of benefits derived from the lease arrangements.

Lease incentives taking the form of ‘free’ leasehold improvements and rent holidays are recognised as liabilities. These liabilities are reduced by allocating lease payments between rental expense and reduction of the liability over the life of the lease. Lease incentives are recognised as a reduction of rental expense over the lease term on a straight-line basis unless another systematic basis is more reflective of the time pattern of the lessee's benefit.

Where leased premises are considered surplus, the operating rent has been brought to account in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets. The net present value of future net outlays in respect of surplus space under non-cancellable lease agreements is expensed in the period in which the space becomes surplus.

The Department makes an immediate allowance for property make-good where required under lease agreements.

Borrowing Costs

All borrowing costs are expensed as incurred.

1.2 Own-Source Revenue and Gains

Own-Source Revenue

1.2A: Sale of goods and rendering of services
2017
$'000
2018
$'000
Sale of goods 8 30
Rendering of services 7,498 3,359
Total sale of goods and rendering of services 7,506 3,389
1.2B: Other revenue
2017
$'000
2018
$'000
Resources received free of charge
Remuneration of auditors 540 540
Other 90 400
Total other revenue 630 940

Gains

1.2C: Other gains
2017
$'000
2018
$'000
Assets acquired at fair value 438 -
Unwinding of provision for surplus lease space 243 1,055
Reversal of lease liabilities 76 -
Other 14 12
Total other gains 771 1,067
1.2D: Revenure from Government
2017
$'000
2018
$'000
Appropriations
Departmental appropriations 241,677 248,457
Total revenue from Government 241,677 248,457

Accounting Policy

Revenue from the Sale of Goods or Rendering of Services

Revenue from the sale of goods is recognised when:

  1. the risks and rewards of ownership have been transferred to the buyer
  2. the Department retains no managerial involvement or effective control over the goods
  3. the revenue and transaction costs incurred can be reliably measured and
  4. it is probable that the economic benefits associated with the transaction will flow to the Department.

Revenue from rendering of services is recognised by reference to the stage of completion of contracts at the reporting date. The revenue is recognised when:

  1. the amount of revenue, stage of completion and transaction costs incurred can be reliably measured and
  2. the probable economic benefits associated with the transaction will flow to the Department.

The stage of completion of contracts at the reporting date is determined by reference to the proportion that costs incurred to date bear to the estimated total costs of the transaction.

Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any impairment allowance account. Collectability of debts is reviewed at the end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

Other Revenue

Resources Received Free-of-Charge

Resources received free-of-charge are recognised as revenue when, and only when, a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense. Resources received free-of-charge are recorded as either revenue or gains depending on their nature.

Other Gains

Resources Received Free-of-Charge

Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition, unless received from another Government entity as a consequence of a restructuring of administrative arrangements (refer to Note 8.2).

Sale of Assets

Gains and losses from disposal of assets are recognised when control of the assets has passed to the buyer.

Revenue from Government

Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the Department gains control of the appropriation. Appropriations receivable are recognised at their nominal amounts.

Prev. Contents of financial statements notes Next