National Transport Commission
Section 3: Explanatory tables and budgeted financial statements3
Section 3 presents explanatory tables and budgeted financial statements which provide a comprehensive snapshot of agency finances for the Budget year 2011-12. It explains how budget plans are incorporated into the financial statements and provides further details of the reconciliation between appropriations and program expenses, movements in administered funds, special accounts and government indigenous expenditure.
3.1.1: Movement of administered funds between years
NTC does not receive administered funds.
3.1.2: Special Accounts
NTC does not maintain Special Accounts.
3.1.3: Australian Government Indigenous Expenditure
The 2011-12 Australian Government Indigenous Statement is not applicable because NTC has no indigenous specific expenses.
3.2.1: Differences in agency resourcing and financial statements
NTC does not have any significant differences between the resource information presented in the Budget Papers and Portfolio Budget Statements as a result of differences between Australian Accounting Standards (AAS) and Government Finance Statistics (GFS).
3.2.2: Analysis of budgeted financial statements
An analysis of NTC's budgeted financial statements, as reflected in the budgeted departmental financial statements for 2011-12, is provided below.
Budgeted departmental income statement
NTC's primary source of income is funding provided by Commonwealth, States and Territories on an annual basis, apportioned by an agreed percentage allocation as outlined within NTC's IGA. Annual funding is increased by index (forward CPI) each year to support NTC's work program portfolio.
Under the NTC Act, funding for the Commission is to be applied only in payment or discharge of the costs, expenses and other obligations incurred by the Commission in the performance of its functions and the exercise of its powers.
Each year, the Commission must prepare estimates, in accordance with ATC directions, of the Commission's receipts and expenditure for each financial year and, if the ATC so directs, for any other period specified by the ATC. The Commission must submit estimates so prepared to the ATC no later than such a date as the ATC directs. Except with the consent of ATC, the funding of the Commission must not be spent otherwise than in accordance with the applicable strategic plan and work program provided annually. On this basis, NTC's forward estimate may change yearly based on directions from ATC.
NTC is budgeting to utilise the available cash reserve, therefore forcing a deficit operating result for 2010-11 and 2011-12. NTC will return to budgeting for a zero operating result for the years following.
Budgeted departmental balance sheet
The NTC's balance sheet is simple in structure and classification. Assets are largely comprised of cash and office plant and equipment, while liabilities are payables (to suppliers) and employee provision (staff entitlements).
3.2.3: Budgeted financial statements tables
Table 3.2.1: Comprehensive income statement (showing net cost of services) (for the period ended 30 June)
Table 3.2.3: Departmental statement of changes in equity - summary of movement (Budget year 2011-12)
3.2.4: Notes to the financial statements
1. Accounting policy
The budgeted financial statements have been prepared on an accrual accounting basis, having regard to Statements of Accounting Concepts, and in accordance with:
- the Finance Minister's Orders;
- Australian Accounting Standards; and
- other authoritative pronouncements of the Australian Accounting Standards Board.
2. Departmental and administered items
Agency assets, liabilities, revenues and expenses are those items that are controlled by NTC that are used in producing its outcomes and include:
- infrastructure, plant and equipment used in providing goods and services;
- liabilities for employee entitlements;
- revenue from appropriations or independent sources in payment for outcomes; and
- employee, supplier and depreciation expenses incurred in providing agency outcomes.
NTC has no administered items.
3. Departmental expenses - employees
Payments and net increases in entitlements to employees for services rendered in the financial year.
4. Departmental expenses - suppliers
Payments to suppliers for goods and services used in providing in agency outcomes.
5. Departmental expenses - depreciation and amortisation
Depreciable property plant and equipment, buildings and intangible assets are written-off to their estimated residual values over their estimated useful life to NTC, using the straight-line calculation method.
6. Departmental revenue
Revenue from government represents funding from Commonwealth, appropriated based on the funding formula outlined in the NTC IGA.
Revenue from other sources, representing sales from goods and service and funding from states and jurisdictions, is recognised when:
- the risk and awards of ownership have been transferred to the buyer;
- the seller retains no managerial involvement nor effective control over the goods;
- the revenue and transaction costs incurred can be reliably measured; and
- it is probable that the economic benefits associated with the transaction will flow to the entity.
7. Departmental assets - financial assets
The primary financial asset relates to cash and receivables. Financial assets are used to fund NTC work program, employee entitlements, creditors and to provide working capital.
8. Departmental assets - non-financial assets
These items represent future economic benefits that NTC will consume in producing outcomes. The reported value represents the purchase price paid less depreciation incurred to date in using the asset.
9. Departmental liabilities - provisions and payables
Provision has been made for NTC's liability for employee entitlements arising from services rendered by employees. This liability includes unpaid annual leave and long service leave.
3 All tables within this section do not include estimates for 2010-11 as the NTC becomes a reporting independent statutory body under the Commonwealth Authorities and Companies Act 1997 from 1 July 2011.