This section analyses the financial performance of the Attorney-General's Department for the year ended 2020.

4.1 Expenses (excluding employee benefits expenses) ¹

The department has short-term lease commitments of $26.002m at 30 June 2020.

The above lease disclosures should be read in conjunction with the accompanying notes 4.1C, 6.2A and 6.4A.

Accounting Policy

Short-term leases and leases of low-value assets

The department has elected not to recognise right-of-use assets and lease liabilities for short-term leases of assets that have a lease term of 12 months or less and leases of low-value assets (less than $10,000). The department recognises the lease payments associated with these leases as an expense on a straight-line basis over the life of lease.

Accounting Policy

All borrowing costs are expensed as incurred.

Accounting Policy

The Australian Government Solicitor section of the department provided services on a for-profit basis up to 30 June 2019 and was subject to the Australian Government’s Competitive Neutrality Policy. The above amounts have been calculated as being payable to the Australian Government in the form of company income tax under the Income Tax Assessment Acts had they applied. These amounts have been paid or are payable by the department to the Official Public Account.

4.2 Revenue and gains ²

Accounting Policy

Revenue from the sale of goods is recognised when control has been transferred to the buyer.

The following is a description of principal activities from which the department generates its revenue:

• The majority of AGS revenue consists of fees for the provision of legal services. AGS also has a number of small additional streams including revenue from training programs. The bulk of AGS services are provided to Commonwealth entities. AGS also provides legal services to a number of other clients including universities and state and local governments. As the majority of AGS customers are within the Commonwealth, collection risks are minimal
• The department also receives revenue in the form of annual subscriptions from Commonwealth entities to access the Whole of Government Legal Services Panel.

The transaction price is the total amount of consideration to which the department expects to be entitled in exchange for transferring promised goods or services to a customer. The consideration promised in a contract with a customer may include fixed amounts, variable amounts, or both.

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 during the financial year and at end of the reporting period. Impairment allowances are made when collectability of the debt is no longer probable.

GAINS

Accounting Policy

Resources received free of charge

Resources received free of charge are recognised as gains 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 gain depending on their nature.

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 agency or authority as a consequence of a restructuring of administrative arrangements (Refer Note 9.2).

Accounting Policy

Revenue from Government

Amounts appropriated for departmental outputs for the year (adjusted for any formal additions and reductions) are recognised as revenue from Government when the department gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned.

Appropriations receivable are recognised at their nominal amounts.