Department of Infrastructure and Regional Development

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: Explanatory tables

3.1.1: Movement of administered funds between years

Administered funds can be provided for a specified period, for example under annual Appropriation Acts. Funds not used in the specified period, with the agreement of the Finance minister, may be moved to a future year. Table 3.1.1 shows the movement of administered funds approved between years.

Table 3.1.1: Movement of administered funds between years

3.1.2: Special Accounts

Special accounts provide a means to set aside and record amounts used for specified purposes. Special Accounts can be created by a Finance Minister's Determination under the Financial Management and Accountability Act 1997 or under separate enabling legislation. Table 3.1.2 shows the expected additions (receipts) and reductions (payments) for each account used by the Department.

Table 3.1.2: Estimates of Special Account flows and balances

3.1.3: Australian Government Indigenous Expenditure

Table 3.1.3: Australian Government Indigenous Expenditure (AGIE)

3.2: Budgeted financial statements

3.2.1: Differences in agency resourcing and financial statements

The Department 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).

The difference between the resource statement in Section 1 and the financial statements contained within Section 3 mainly relates to the timing of accruals for items such as depreciation, employee entitlements and other creditors and debtors, as well as the expensing of prepayments made in prior periods.

3.2.2: Analysis of budgeted financial statements

An analysis of the Department's financial position, as reflected in the budgeted departmental financial statements and administered schedules for 2014–15, is provided below.

Budgeted departmental income statement

Total expenses are estimated to be $284.8m in 2014–15, an increase of $30.1m from the 2013–14 estimated actual. The increase is primarily due to the impact of measures announced in the 2014–15 Budget and increased funding following the Administrative Arrangements Order of 18 September 2013.

Chart 3.1: Total departmental expenses

Chart 3.1: Total departmental expenses

Budgeted departmental balance sheet

The Department's major assets are in Buildings ($16.6m), Intangibles ($20.0m) and Property Plant and Equipment ($4.9m). The Department's primary liability continues to be accrued employee leave entitlements, estimated at $46.5m.

Schedule of budgeted income and expenses administered on behalf of government

The Department administers the collection of taxes, fees and fines, other non-taxation revenue and interest and dividends estimated at $752.3m in 2014–15, representing a decrease of $802.6m from the 2013–14 estimated actual. The decrease is primarily due to the profile of receipts from the Building Australia Fund special account for grants under the Plan for the Future administered item ($819.9m); a reduction in the return of previous year payments ($19.4m) and reduced revenue under the Services to Indian Ocean Territories administered item ($6.0m). These decreases are partially offset by increased dividend revenue ($34.2m), and levies collected by the Australian Maritime Safety Authority ($3.1m) and from the aircraft noise levy at Adelaide Airport ($5.0m).

Administered expenses are budgeted at $4 439.7m in 2014–15, representing an increase of $662.8m from the 2013–14 estimated actual and will be incurred for the administered items set out at Section 2. The increase is due to increased expenses from changes in the funding profile of:

  • the Local Government Financial Assistance Grants administered item ($1 421.4m); and
  • several other administered items including the part year effect of the transfer of administered items from the Department of Regional Australia, Local Government, Arts and Sport following the Administrative Arrangements order of 18 September 2013 ($256.6m).

The increase is partially offset by decreased expenses from changes in the funding profile of the Plan for the Future ($819.9m) and the Infrastructure Investment Programme ($195.3m) administered items.

Chart 3.2: Total administered expenses

Chart 3.2: Total administered expenses

Schedule of budgeted assets and liabilities administered on behalf of government

Total assets are expected to decrease in 2014–15 by $2.9m to $5 279.9m from the 2013–14 estimated actual result. The decrease relates mainly to a net reduction in non-financial assets ($24.1m) and receivables ($12.1m), partially offset by an increase in administered investments ($33.4m).

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 3.2.2: Budgeted departmental balance sheet (as at 30 June)

Table 3.2.3: Departmental statement of changes in equity—summary of movement (Budget year 2014–15)

Table 3.2.4: Budgeted departmental statement of cash flows (for the period ended 30 June)

Table 3.2.5: Departmental capital budget statement

Table 3.2.6: Statement of asset movements (2014–15)

Table 3.2.7: Schedule of budgeted income and expenses administered on behalf of Government (for the period ended 30 June)

Table 3.2.8: Schedule of budgeted assets and liabilities administered on behalf of Government (as at 30 June)

Table 3.2.9: Schedule of budgeted administered cash flows (for the period ended 30 June)

Table 3.2.10: Schedule of administered capital budget statement

Table 3.2.11: Schedule of asset movements (2014–15)

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;
  • Other authoritative pronouncements of the Australian Accounting Standards Board; and
  • The Consensus Views of the Urgent Issues Group.
  1. Departmental and administered items

Agency assets, liabilities, revenues and expenses are those items that are controlled by the Department and are used by the Department in producing its outputs and include:

  • computers, plant and equipment used in providing goods and services;
  • liabilities for employee entitlements;
  • revenue from appropriations or independent sources in payment for outputs; and
  • employee, supplier and depreciation expenses incurred in providing agency outputs.

Administered items are those items incurred in providing programmes that are controlled by government and managed, or oversighted, by the Department on behalf of government. Administered expenses included grant payments and subsidies, and administered revenues include levies, fees and fines.

  1. Departmental expenses—employee benefits

Payments and net increases in entitlements to employees for services rendered in the financial year.

  1. Departmental expenses—suppliers

Payments to suppliers for goods and services used in providing agency outputs.

  1. Departmental expenses—depreciation and amortisation

Depreciable infrastructure, plant and equipment, buildings and intangible assets are written-off to their estimated residual values over their estimated useful life to the Department, using the straight-line calculation method.

  1. Departmental own-source revenue

Revenue from government represents the purchase of outputs from the Department by government and is recognised to the extent that it has been received into the Department's bank account.

Revenue from other sources, representing sales from goods and services, is recognised when:

  • the risks and rewards 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 Department.
  1. Departmental assets—financial assets

The primary financial asset relates to receivables. Financial assets are used to fund the Department's capital programme, employee entitlements, creditors and to provide working capital.

  1. Departmental assets—non-financial assets

These items represent future economic benefits that the Department will consume in producing outputs. The reported value represents the purchase price paid less depreciation incurred to date in using the asset.

  1. Departmental liabilities—provisions

Provision has been made for the Department's liability for employee entitlements arising from services rendered by employees. This liability includes unpaid annual leave and long service leave.

  1. Expenses administered on behalf of Government

The majority of the Department's administered programmes are classified as grants, the most significant being the Infrastructure Investment Programme, Plan for the Future and Local Government Financial Assistance Grants administered items.

  1. Own-source revenues administered on behalf of Government

Details of the range of taxation and non-taxation revenue collected by the Department are provided at Appendix 3.2.1.

  1. Administered assets—financial assets

Comprise primarily the Australian Government's investments in portfolio agencies.

Appendix 3.2.1: Administered income

Appendix 3.2.2: Administered loan repayments

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Budget 2014-15