Civil Aviation Safety Authority
Section 3: Explanatory tables and budgeted financial statements
Section 3 presents explanatory tables and budgeted financial statements which provide a comprehensive snapshot of agency finances for the 2014–15 budget year. It explains how budget plans are incorporated into the financial statements and provides further details of the reconciliation between appropriations and programme expenses, movements in administered funds, special accounts and government Indigenous expenditure.
3.1.1: Movement of administered funds between years
CASA does not receive administered funds.
3.1.2: Special Accounts
CASA does not maintain Special Accounts.
3.1.3: Australian Government Indigenous Expenditure
CASA does not have any Indigenous specific expenses.
3.2.1: Differences in agency resourcing and financial statements
CASA 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 CASA's budgeted financial statements, as reflected in the budgeted departmental financial statements for 2014–15, is provided below.
Budgeted departmental income statement
CASA is budgeting for an operating deficit in 2013–14 of $9.6m. This is mainly due to: a decrease in Special Appropriation from aviation fuel excise, orginally forecast to be $125.6m in 2013–14, but now estimated at $121.5m, a decrease of $4.1m; a $3.7m provision for a management initiated structural change programme and a $1.8m provision for the write–down and impairment of assets.
CASA is planning a breakeven position in 2014-15. The completion of the structural change programme, increasing CASA's focus on the delivery of its core regulatory services, is forecast to result in a reduction of staff from 855 to 833 over the year.
CASA is budgeting for small but increasing operating surpluses in the forward years as the Special Appropriation for aviation fuel excise is forecast to recover during 2015-16.
Chart 3.1 illustrates CASA's revenue funding. Revenue from special appropriations will hold in the budget year and then slowly increase in the forward years.
Chart 3.1: Revenue
Total expenses in 2014-15 are estimated to be $187.5m, a decrease of $4.9m when compared to 2013-14. The main movements in the major expense categories are:
- Employee expenses is decreasing by $5.5m, mainly due to a the management initiated structural change programme;
- Depreciation expenses increasing by $0.6m, reflecting an increased level of capital expenditure from previous financial years;
- Supplier expenses increasing by $2.2m, mainly due to the increase in software costs for new IT systems coming on line in 2014-15;
- Write-down and impairment of assets has decreased by $1.8m; and
- Finance costs decrease by $0.4m in 2014-15. This represents the costs associated with the disposal of two buildings in 2013-14.
Budgeted departmental balance sheet
CASA's net asset (or equity) position for 2014-15 is forecast to remain steady compared to 2013-14.
Chart 3.2 illustrates CASA's budgeted asset profile. Total budgeted assets of $108.2m in 2014–15 represents a decrease of $0.1m from the estimated 2013–14 closing position.
Chart 3.2: Budgeted Assets for 2014–15
Chart 3.3 illustrates CASA's budgeted liabilities profile. Total budgeted liabilities of $47.9m in 2014–15 represents a decrease of $0.1m from the estimated 2013–14 closing position. CASA's primary liability continues to be accrued employee leave entitlements of $26.8m.
Chart 3.3: Budgeted Liabilities for 2014–15
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)
3.2.4: Notes to the financial statements
Basis of accounting
The budgeted financial statements have been prepared on an accrual basis and are in accordance with the historical cost convention, except for infrastructure, plant and equipment assets and employee entitlements. Property, plant and equipment assets are revalued every year using a fair value methodology. Employee entitlements are measured at the present value of estimated future cash flows based on periodic actuarial assessment.
The budgeted financial statements contain estimates prepared in accordance with the requirements of the Australian Government's financial budgeting and reporting framework, including:
- the Finance Minister's Orders;
- Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board; and
- specific guidance provided by the Department of Finance.
Departmental and administered items
Agency assets, liabilities, revenues and expenses are those items that are controlled and used by CASA in providing its goods and services and include:
- computers, plant and equipment used in producing goods and services;
- liabilities for employee entitlements;
- revenue from appropriations or independent sources in payment for services; and
- employee, supplier and depreciation expenses incurred in providing agency services.
CASA has no administered items.
Budgeted departmental income statement
Revenue from Government
CASA's ‘at risk’ component of its appropriation estimates are subject to indexation and efficiency dividend adjustments as part of its agreed funding arrangements. Estimates for special appropriation funding have been made on the basis of expected aviation fuel excise collections.
The Department of Infrastructure and Regional Development draws down ordinary and special appropriations on behalf of CASA.
Goods and services revenue
Goods and services revenue primarily represents revenue from cost recovery arrangements and purchase provider arrangements. Estimates are derived from projected service level activities and agreed purchase provider arrangements.
Other revenue comprises the sale of forms and documents, advertising, administrative fines and other sundry revenue. Estimates are based on averages from prior year receipts.
Employee expenses represent payments and accruing entitlements to employees for services rendered in the financial year.
Supplier expenses represent payments made and accruing obligations to suppliers for goods and services used in providing CASA's goods and services.
Depreciation and amortisation expenses comprise of depreciable plant and equipment, buildings and intangible assets as they are written-off to their estimated residual values over their projected useful life to CASA using the straight-line calculation method.
Departmental assets—financial assets
CASA's financial assets are maintained to fund CASA's capital replacements, employee entitlements, creditors and to provide working capital. In addition, CASA's cash reserves provide a contingency to offset fluctuations in aviation fuel excise to avoid calls for additional budget supplementation.
Departmental assets—non-financial assets
These items primarily represent future economic benefits that CASA will consume in providing goods and services. Reported values represent the purchase price paid, adjusted for revaluations, less depreciation incurred to date in using the asset.
Other non-financial assets represent prepaid supplier expenses as at balance date.
Departmental liabilities—provisions and payables
Provision has been made for CASA's liability for employee entitlements arising from services rendered by employees. This liability includes unpaid annual leave and long service leave.
Provision has also been made for unpaid supplier expenses as at balance date.