Annual financial statements notes
Overview
The Basis of Preparation
The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance and Accountability Act 2013.
The financial statements have been prepared in accordance with:
- Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR) for reporting periods ending on or after 1 July 2015; and
- Australian Accounting Standards and Interpretations – Reduced Disclosure Requirements issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.
The financial statements have been prepared on an accrual basis and are in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position. The financial statements are presented in Australian dollars and values, and are rounded to the nearest thousand dollars unless otherwise specified.
Taxation
The ABS is exempt from all forms of taxation except Fringe Benefits Tax and the Goods and Services Tax (GST).
Revenues, expenses and assets are recognised net of GST except where the amount of GST incurred is not recoverable from the Australian Taxation Office; and for receivables and payables.
|
Reporting of Administered Activities Administered revenues, assets, and cash flows are disclosed in the administered schedules and related notes. There are no administered expenses, liabilities, contingencies or commitments in 2018 or 2017. Except where otherwise stated below, administered items are accounted for on the same basis and using the same policies as for departmental items, including the application of Australian Accounting Standards. |
Simplification of the Financial Statements
As part of adopting the Tier 2: Australian Accounting Standards – Reduced Disclosure Requirements and enhancing the quality of disclosure in the ABS’s financial statements, the ABS has reduced the length and complexity of its financial statements by:
- removing information that is irrelevant, immaterial or not mandatory
- removing single line item notes that essentially restate information from the primary statements
- combining notes and tables that provide the same information for different line items
- removing notes that contain duplicate information
- reformatting tabular disclosures where possible to make the disclosure easier to understand and to shorten the financial statements.
While still complying with Australian Accounting Standards and other requirements, the above provides users with clear and concise financial reports that allow a focus on the key information about the performance, position and cash flows of the ABS. There was no change to the comparative operating result or net assets reported.
Events after the Reporting Period
There have been no events occurring subsequent to the balance date that would affect the ABS’s financial statements for the financial year ended 30 June 2018.
Explanations of Major Variances to Budget
The following table provides high level commentary of major variances between budgeted information for the ABS published in the Treasury’s 2017-18 Portfolio Budget Statements (PBS) and the 2017-18 final outcome as presented in accordance with Australian Accounting Standards for the ABS. The Budget is not audited.
An explanation for a major variance may not be provided where the item is considered immaterial in the overall context of the financial statements.
As a guide, variances are considered to be ‘major’ based on the following criteria:
- the variance between budget and actual is greater than 10%; and
- the variance between budget and actual is greater than 2% of the relevant category (Income, Expenses and Equity totals); or
- an item below this threshold but is considered important for the reader’s understanding or is relevant to an assessment of the discharge of accountability and to an analysis of performance of an entity.
|
Affected line items |
Variance to Budget $’000 |
Variance to Budget % |
Explanations of major variances |
|
Statement of Comprehensive Income |
|||
|
Suppliers |
63,811 |
62% |
The variance is largely due to the Australian Marriage Law Postal Survey (AMLPS) which the ABS was directed to conduct on 14 August 2017. The amount primarily relates to consultants, contractors, printing, stationery and postage expenditure. The impact of the AMLPS was unknown at the time the budget was prepared. |
|
Depreciation and amortisation |
(10,999) |
(25%) |
The delay in capital projects (Canberra Office Transformation Project and Statistical Business Transformation Program) impacted on the asset base, resulting in lower depreciation. |
|
Other revenue |
1,551 |
81% |
The variance is largely due to refund of prior year’s lease payments as a result of lower than expected lease payments and a reduction in Comcare premium. |
|
Revenue from Government |
84,816 |
26% |
The variance primarily relates to the additional funding received by the ABS to undertake the AMLPS. The impact of the AMLPS was unknown at the time the budget was prepared. |
|
Changes in asset revaluation surplus |
6,585 |
100% |
The variance primarily relates to the upward revaluation of leasehold improvements, plant and equipment due to extended useful life of assets assessment. |
|
Statement of Financial Position |
|||
|
Cash and cash equivalents |
(1,366) |
(38%) |
Cash is drawn down from the Official Public Account for payment on a needs basis. The cash balance varies depending on the timing of debt collection and payments at the reporting date. |
|
Trade and other receivable |
39,516 |
65% |
The majority of this balance represents Appropriation Receivable. The variance is due to appropriations that were not drawn down at the reporting date. |
|
Leasehold improvements/ Plant and equipment |
12,538 |
25% |
The variance is primarily due to the upward asset revaluation and refit of the Canberra office. |
|
Prepayments |
(3,597) |
(35%) |
Prepayments primarily related to the recognition of software licences, maintenance contracts, office lease payments and subscriptions. The variance is largely due to the timing of payment for office leases and software licences. |
|
Suppliers |
10,305 |
53% |
The variance is primarily due to the timing differences between expense recognition and settlement. Settlement is usually made within 30 days of the receipt of goods and services accompanying tax invoices. |
|
Other provision |
(5,611) |
(92%) |
The variance is primarily due to lower than expected settlement of make good provisions. |
|
Statement of Changes in Equity and Cash Flow Statement |
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|
The above explanations of major variances to the Budget are also applicable to the Statement of Changes in Equity and the Cash Flow Statement. |
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1. Financial Performance
This section analyses the financial performance of the Australian Bureau of Statistics for the year ended 2018.
1.1 Expenses
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 1.1A: Employee Benefits |
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|
Wages and salaries |
||
|
ABS staff |
198,206 |
235,197 |
|
Interviewers |
13,267 |
13,397 |
|
Census field staff |
9 |
65,351 |
|
Total wages and salaries |
211,482 |
313,945 |
|
Superannuation |
||
|
Defined contribution plans |
||
|
ABS staff |
20,328 |
24,219 |
|
Interviewers |
1,874 |
1,552 |
|
Census field staff |
3 |
6,266 |
|
Total defined contribution plans |
22,205 |
32,037 |
|
Defined benefit plans |
||
|
ABS staff |
19,133 |
20,145 |
|
Interviewers |
513 |
758 |
|
Census field staff |
1 |
108 |
|
Total defined benefit plans |
19,647 |
21,011 |
|
Leave and other entitlements |
25,778 |
27,209 |
|
Separation and redundancies |
7,834 |
12,489 |
|
Other employee expenses |
1,126 |
1,153 |
|
Total employee benefits1 |
288,072 |
407,844 |
1. In 2016-17, $83,000 of employee expenses was included in Note 1.1B Suppliers. In 2017-18, this expense was reclassified to Note 1.1A Employee Benefits. There was no impact on the comparative operating result reported.
Accounting Policy
Liabilities for ‘short-term employee benefits’ (as defined in AASB 119 Employee Benefits) and termination benefits due within twelve months of the end of the reporting period are measured at their nominal amounts.
The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.
Other long-term employee benefits are measured as net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.
Leave
The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of the ABS is estimated to be less than the annual entitlement for sick leave.
The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will apply at the time the leave is taken, plus the ABS’s employer superannuation contribution rates and applicable on-costs, to the extent that the leave is likely to be taken during service rather than paid out on termination.
The liability for long service leave has been determined by reference to the work of the Australian Government Actuary as at 30 June 2018. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.
An independent actuarial valuation of employee benefit liabilities is conducted every three years. The last review was performed by the Australian Government Actuary in June 2017.
Separation and Redundancy
Provision is made for separation and redundancy benefit payments. The ABS recognises a provision for termination when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.
Superannuation
The ABS’s staff are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), the PSS accumulation plan (PSSap) or other elected defined contribution schemes.
The CSS and PSS are defined benefit schemes for the Australian Government. The PSSap is a defined contribution scheme.
The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported in the Department of Finance’s administered schedules and notes including significant accounting judgements.
The ABS makes employer contributions to the employees’ superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government, and accounts for the contributions as if they were contributions to defined contribution plans.
The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 1.1B: Suppliers |
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|
Goods and services |
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|
Consultants |
7,008 |
4,175 |
|
Contractors |
23,145 |
21,144 |
|
IT services and communications |
23,511 |
19,834 |
|
Printing and subscriptions |
14,482 |
2,547 |
|
Building expenses (excluding lease payments) |
8,758 |
10,528 |
|
Population survey operations interviewer |
4,225 |
4,675 |
|
Census operation costs |
5 |
13,761 |
|
Recruitment and employment related |
603 |
971 |
|
Stationery and postage |
28,344 |
24,277 |
|
Travel |
10,557 |
10,469 |
|
Training |
4,536 |
3,899 |
|
Advertising and market research |
17,317 |
21,548 |
|
Other |
2,701 |
3,045 |
|
Total goods and services supplied or rendered |
145,192 |
140,873 |
|
Goods and services are made of: |
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|
Goods supplied |
20,230 |
7,916 |
|
Services rendered |
124,962 |
132,957 |
|
Total goods and services |
145,192 |
140,873 |
|
Other suppliers |
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|
Operating lease rentals |
16,714 |
27,012 |
|
Workers compensation expenses |
4,718 |
7,755 |
|
Total other suppliers |
21,432 |
34,767 |
|
Total suppliers1 |
166,624 |
175,640 |
1. Refer to Note 1.1A for reclassification between Note 1.1A and Note 1.1B.
In 2017-18, the mapping of suppliers expenses by category was reviewed and updated including for 2016-17. There was no impact on the comparative operating result reported.
|
Leasing commitments |
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|
The ABS in its capacity as lessee has the following types of operating leases: |
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|
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows: |
|||
|
Within 1 year |
10,214 |
8,550 |
|
|
Between 1 to 5 years |
42,453 |
41,810 |
|
|
More than 5 years |
25,953 |
38,324 |
|
|
Total operating lease commitments |
78,620 |
88,684 |
Accounting Policy
Leases
Operating lease payments are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets.
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 1.1C: Write-down and Impairment of Assets |
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|
Impairment on financial instruments |
5 |
8 |
|
Impairment on intangible assets |
553 |
2,436 |
|
Impairment of property, plant and equipment |
1,271 |
1,081 |
|
Total write-down and impairment of assets |
1,829 |
3,525 |
1.2 Own Source Revenue and Gains
|
Note 1.2 A - Sale of Goods and Rendering of Serivces |
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|
Sale of goods1 |
- |
32 |
|
Rendering of services |
35,868 |
44,325 |
|
Total sale of goods and rendering of services1 |
35,868 |
44,357 |
1. In 2017-18, the mapping of sale of goods and rendering of services by category was reviewed and updated including for 2016-17. There was no impact on the comparative operating result reported.
Accounting Policy
Sales of goods and services include revenue from the sale of publications, other products, and the provision of statistical services.
Revenue from the sales of goods is recognised when:
- the risks and rewards of ownership have been transferred to the buyer;
- the ABS retains no managerial involvement or 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 ABS.
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:
- the amount of revenue, stage of completion and transaction costs incurred can be reliably measured; and
- the probable economic benefits associated with the transaction will flow to the ABS.
The stage of completion of contracts at the reporting date is determined by reference to the proportion of costs incurred to date when compared 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. Refer to Note 2.1A for further detail.
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 1.2B: Other Revenue |
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|
Resources received free of charge1 |
327 |
224 |
|
Rental income |
- |
1,102 |
|
Other2 |
3,128 |
753 |
|
Total other revenue |
3,455 |
2,079 |
1. This amount relates to the services received free of charge from the Australian National Audit Office financial statements audit, external board members, and staff secondment from the Australian Taxation Office.
2. This amount primarily includes Comcare premium reduction and refund of prior year lease payments.
Accounting Policy
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 revenue
Other revenue includes all miscellaneous revenue such as various refunds including Comcare premiums.
|
Note 1.2C: Other Gains |
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|
Settlement |
- |
35,000 |
|
Other1 |
233 |
2,249 |
|
Total other gains |
233 |
37,249 |
1. This amount includes gains on sale of assets and make-good provision settlement.
Accounting Policy
Compensatory settlement
Compensatory settlement is recognised when the recoverable amount can be reliably measured and collectability is probable.
Sale of assets
Gains from disposal of non-current assets are recognised when control of the asset has passed to the buyer.
Settlement of make-good provision
Gains from settlement of make-good provision are recognised when the estimated restoration cost is no longer required.
2. Financial Position
|
This section analyses the Australian Bureau of Statistics’s assets used to generate its financial performance and operating liabilities incurred as a result. Leasehold improvements and plant and equipment are carried at fair value in accordance with AASB 13 Fair Value Measurement. The remaining assets and liabilities disclosed in the statement of financial position do not apply the fair value hierarchy. Employee related information is disclosed in the People and Relationships section. |
2.1 Financial Assets
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 2.1A: Trade and Other Receivables |
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|
Appropriations receivable |
93,594 |
95,134 |
|
Goods and services |
3,074 |
4,937 |
|
GST receivable from the Australian Taxation Office |
3,350 |
1,739 |
|
Other receivables |
325 |
1,245 |
|
Total trade and other receivables (gross) |
100,343 |
103,055 |
|
Less impairment allowance |
(4) |
(7) |
|
Total trade and other receivables (net) |
100,339 |
103,048 |
Credit terms for goods and services were within 30 days (2017: 30 days).
All trade and other receivables are expected to be recovered in no more than 12 months.
|
Reconciliation of the Impairment Allowance Account: |
|||
|
Movements in relation to 2018 |
|||
|
Goods and services |
Total |
||
|
$'000 |
$'000 |
||
|
Opening balance |
(7) |
(7) |
|
|
Amounts written off |
8 |
8 |
|
|
Increase/(decrease) recognised in net surplus |
(5) |
(5) |
|
|
Closing balance |
(4) |
(4) |
Accounting Policy
Trade receivable
Trade receivables are classified as ‘loans and receivable’ and recorded at face value less impairment. Trade receivables are recognised where the ABS has aright to receive cash. Trade receivables are derecognised upon payment.
Appropriations receivable
Refer to Revenue from Government for accounting policy.
Impairment of financial assets
Receivables are assessed for impairment at the end of each reporting period. Allowances are made when collectability of the debt is no longer probable.
2.2 Non-Financial Assets
|
Note 2.2A: Reconciliation of the Opening and Closing Balances of Plant & Equipment and Intangibles |
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|
Leasehold improvements |
Plant and equipment |
Computer software1 |
Total |
|
|
$’000 |
$’000 |
$’000 |
$’000 |
|
|
As at 1 July 2017 |
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|
Gross book value |
16,820 |
45,804 |
218,603 |
281,227 |
|
Accumulated depreciation, amortisation and impairment |
(5,040) |
(18,446) |
(127,280) |
(150,766) |
|
Total as at 1 July 2017 |
11,780 |
27,358 |
91,323 |
130,461 |
|
Additions |
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|
Purchased |
19,356 |
9,912 |
5,188 |
34,456 |
|
Internally developed |
- |
- |
26,503 |
26,503 |
|
Revaluations and impairments recognised in other comprehensive income2 |
4,696 |
2,051 |
- |
6,747 |
|
Impairments recognised in net cost of services |
(310) |
(961) |
(553) |
(1,824) |
|
Depreciation and amortisation |
(1,978) |
(9,811) |
(20,954) |
(32,743) |
|
Total as at 30 June 2018 |
33,544 |
28,549 |
101,507 |
163,600 |
|
Total as at 30 June 2018 represented by |
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|
Gross book value |
16,055 |
27,697 |
229,551 |
273,303 |
|
Work in progress |
17,489 |
2,162 |
20,076 |
39,727 |
|
Accumulated depreciation, amortisation and impairment |
- |
(1,310) |
(148,120) |
(149,430) |
|
Total as at 30 June 2018 |
33,544 |
28,549 |
101,507 |
163,600 |
1. The carrying amount of computer software included $73.002 million internally generated software and $28.505 million purchased software. The ABS engaged Synergy Australia Group Pty Ltd (Synergy) to assess impairment of internally generated software. The impairment result was reflected in the Statement of Comprehensive Income in accordance with AASB 136 Impairment of Assets.
2. The ABS engaged Pickles Auctions Pty Ltd (Pickles) to revalue Leasehold improvements and Plant and equipment. The increase in the revaluation was $6.747 million which was recognised in the asset revaluation reserves in accordance with AASB 116 Properties, Plant and Equipment. This increase was offset by a decrease of $0.162 million as a result of the revaluation of make good provisions disclosed in Note 2.4A Other Provisions.
Contractual commitments for the acquisition of property, plant, equipment and intangible assets
Capital commitments relate to contracts for the acquisition of property, plant, equipment and intangible assets.
Commitments are GST inclusive where relevant.
|
< 1 year |
|
|
2017-18 Capital Commitments1 |
$'000 |
|
Leasehold improvements |
43 |
|
Plant and equipment |
2,264 |
|
Intangibles |
4,475 |
|
Total commitments |
6,782 |
1. The ABS did not have contractual commitments for more than one year. There was no capital commitment in 2016-17.
Accounting Policy
Acquisition of Assets
Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate.
Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor’s accounts immediately prior to the restructuring.
Asset Recognition Threshold
Purchases of plant and equipment are recognised initially at cost in the statement of financial position, except for purchases costing less than the following thresholds, which are expensed in the year of acquisition.
|
Asset Class |
Recognition Threshold |
|
Leasehold improvements |
$2,000 |
|
Plant and equipment |
$2,000 |
|
IT hardware |
$1,000 |
The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make good’ provisions in property leases taken up by the ABS where there exists an obligation to restore the property to its original condition. These costs are included in the value of the ABS’s leasehold improvements with a corresponding provision for the ‘make good’ recognised.
In 2017-18, the ABS reviewed the asset recognition threshold policy and increased the thresholds to $30,000 for Leasehold improvements and $7,000 for Plant & equipment and IT hardware. These new thresholds will take effect from 1 July 2018.
Revaluations
Following initial recognition at cost, property, plant and equipment are carried at fair value. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets did not differ materially from the assets’ fair values as at the reporting date. The regularity of independent valuations depended upon the volatility of movements in market values for the relevant assets.
Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the surplus/deficit except to the extent that they reversed a previous revaluation increment for that class.
Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.
Depreciation
Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the ABS using, in all cases, the straight-line method of depreciation.
Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.
Depreciation rates applying to each class of depreciable asset are based on the following useful lives:
|
2018 |
2017 |
|
|
Leasehold improvements |
Lease term |
Lease term |
|
Property, plant and equipment |
4-10 years* |
5-10 years* |
*Within this class, Artwork and Curios have a useful life between 10-100 years.
Impairment
All assets were assessed for indications of impairment at 30 June 2018. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment loss recognised if the asset’s recoverable amount is less than its carrying amount.
The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the ABS were deprived of the asset, its value in use is taken to be its depreciated replacement cost.
Derecognition
An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.
Intangibles
The ABS’s intangibles comprise purchased and internally developed software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.
Software assets were assessed for indications of impairment as at 30 June 2018. Refer to Note 1.1C for further detail.
Internally Generated Software
In its role as Australia's national statistical entity, the ABS builds and maintains a significant set of internally generated software assets (IGSW) assets. These assets are added to over time, in line with the increasing range of statistical information sought by Government, business and the general community, and the increasing use of technology, particularly in relation to collection, analysis and dissemination activities.
All software developed in-house since 1 July 1994 has been capitalised. The costing methodology capitalises direct salary and on costs for programmers, general administration, and overhead costs relating to software development are not capitalised. The data capture systems in place to collect effort recording data for programmers are in line with the requirements of the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015.
Asset Recognition Threshold
Purchases of intangible assets are recognised initially at cost in the statement of financial position, except for purchases costing less than the following thresholds, which are expensed in the year of acquisition.
|
Asset Class |
Recognition Threshold |
|
Purchased software |
$1,000 |
|
Internally generated software |
$100,000 |
In 2017-18, the ABS reviewed the asset recognition threshold policy and increased the thresholds to $50,000 for Purchased software and $300,000 for Internally generated software. These new thresholds will take effect from 1 July 2018.
Amortisation
Software is amortised on a straight-line basis over its anticipated useful life.
The ABS has long term commitments to survey and data collection programs. These are supported by software packages that are required to be maintained for the same time period as the data collection and analysis programs, to ensure consistency in approach and of data treatment.
The useful lives of the ABS’s software are:
|
2018 |
2017 |
|
|
Computer software (purchased) |
5 years* |
5 years* |
|
Computer software (internally generated) |
5-15 years* |
5-15 years* |
* The above table outlines the range of life in years for computer software, however, the average life is currently 10 years (2017: 9 years).
Capital Work in Progress
Capital work in progress represents two main asset types: software assets under development, and office refurbishments. Work in progress is disclosed in the intangibles, and property, plant and equipment balances respectively.
Software assets are not amortised until the year in which the development phase is completed and the asset is operational. Where use of the asset commences after substantial completion of the development phase, but some improvements or enhancements to the system continue to be made, the date of substantial completion is treated as the date of completion and amortisation commences from that date.
2.3 Payables
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 2.3A: Suppliers |
||
|
Trade creditors and accruals |
23,415 |
16,785 |
|
Operating lease rentals |
6,454 |
4,901 |
|
Total suppliers payables |
29,869 |
21,686 |
Settlement is usually made within 30 days.
Accounting Policy
Suppliers and Other Payables
Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced). Supplier and payables are derecognised upon payment.
|
Note 2.3B: Other Payables |
||
|
Salaries and wages |
2,379 |
2,454 |
|
Superannuation |
408 |
399 |
|
Separations and redundancies |
2,009 |
1,810 |
|
Lease incentives |
7,017 |
7,920 |
|
Unearned revenue |
38,576 |
42,701 |
|
Other |
707 |
363 |
|
Total other payables |
51,096 |
55,647 |
Accounting Policy
Salaries and wages, Superannuation, Separations and redundancies
Refer to Note 1.1A: Employee Benefits for detail.
Lease incentives
The ABS has entered into a number of accommodation leases, which include lease incentives taking the form of ‘free’ leasehold improvements. Under interpretation 115 Operating Lease - Incentives, all incentives in relation to operating leases are required to be classified as an integral part of the net consideration of the lease for the leased asset, irrespective of the incentives nature, form, or timing of payments.
Where an asset is acquired by means of an incentive under an operating lease, the asset is capitalised at the fair value of the lease incentive at the inception of the contract, and a liability is recognised at the same time, for the same amount.
Operating lease payments are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets.
Unearned revenue
Unearned revenue includes revenue from provision of statistical consultancies and revenue from other agencies for statistical surveys. The unearned revenue is recognised on a stage of completion basis over the period of the provision of services as provided.
2.4 Provisions
|
Note 2.4A: Other Provisions |
|
|
Make good provision |
|
|
$’000 |
|
|
As at 1 July 2017 |
593 |
|
Additional provisions made |
109 |
|
Amounts used |
(361) |
|
Unwinding of discount or change in discount rate |
6 |
|
Revaluation |
162 |
|
Total as at 30 June 2018 |
509 |
The ABS currently has two agreements (2017: one) for the leasing of premises which have provisions requiring the ABS to restore the premises to their original condition at the conclusion of the lease. The ABS has made a provision to reflect the present value of these obligations.
Significant Accounting Judgements and Estimates
Make good
The ABS currently holds ten leases for office space around Australia. All of the lease agreements include a make good clause.
It is considered that two make good arrangements are likely to be exercised as it is probable that an outflow of resources will be required to settle the obligation and the amount can be reliably determined. The provision represents the estimated costs of making good leasehold premises in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets.
For the remaining eight leases, it is considered probable that the make good requirement will not be exercised.
3. Funding
This section identifies the Australian Bureau of Statistics’s funding structure
3.1 Appropriations
|
Note 3.1A: Annual Appropriations ('Recoverable GST exclusive') |
|||
|
2018 |
2017 |
||
|
Departmental |
$'000 |
$'000 |
|
|
Ordinary annual services1 |
328,937 |
520,363 |
|
|
Advance to the Finance Minister1 |
122,000 |
- |
|
|
Capital Budget2 |
19,928 |
20,402 |
|
|
Receipts retained under PGPA Act – Section 74 |
50,218 |
101,373 |
|
|
Equity Injections3 |
23,298 |
41,706 |
|
|
Total appropriations |
544,381 |
683,844 |
|
|
Appropriations applied (current and prior years) |
(516,635) |
(673,123) |
|
|
Variance4 |
27,746 |
10,721 |
|
1. Revenue from Government reported in the Statement of Comprehensive Income is $413.753 million, $37.184 million less than appropriated. The difference represents:
· a reduction of $42.501 million of operating funding withheld through section 51 of the PGPA Act; and
· an increase of $5.317 million of operating funding through departmental supplementation recognised in 2017-18 but not appropriated in that year.
Advance to the Finance Minister (AFM) relates to the additional funding the ABS received to conduct the Australian Marriage Law Postal Survey. The Survey was completed in November 2017. The total cost of the Survey did not exceed $80.5 million. The balance of the AFM ($41.5 million) was returned to the Official Public Account through the aforementioned $42.501 million section 51 of the PGPA Act process.
2. Departmental Capital Budgets are appropriated through Appropriation Acts (No.1, 3 and 5). They form part of the ordinary annual services, and are not separately identified in the Appropriation Acts.
3. The equity injection amount in the Statement of Changes in Equity includes $6.368 million for capital budgets recognised in 2017-18 but not appropriated in that year.
4. The variance primarily represents undrawn appropriations as at 30 June 2018.
|
Note 3.1B: Unspent Annual Appropriations ('Recoverable GST exclusive') |
|||
|
2018 |
2017 |
||
|
$'000 |
$'000 |
||
|
Departmental |
|||
|
Supply Act (No. 2) 2016‑17 - Non Operating - Equity Injection |
- |
5,377 |
|
|
Appropriation Act (No. 1) 2016-17 |
851 |
73,893 |
|
|
Appropriation Act (No. 1) 2016-17- Capital Budget (DCB) - Non Operating |
564 |
2,781 |
|
|
Appropriation Act (No. 2) 2016-17 - Non Operating - Equity Injection |
6,402 |
13,083 |
|
|
Appropriation Act (No. 1) 2017-18 |
61,804 |
- |
|
|
Appropriation Act (No. 1) 2017-18- Capital Budget (DCB) - Non Operating |
11,492 |
- |
|
|
Appropriation Act (No. 2) 2017-18 - Non Operating - Equity Injection |
796 |
- |
|
|
Cash at bank |
2,234 |
3,763 |
|
|
Total departmental |
84,143 |
98,897 |
|
4. People and Relationships
This section describes a range of employment and post-employment benefits provided to our people and our relationships with other key people.
4.1 Key Management and Personnel Remuneration
Key management personnel (KMP) are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly, including any director (whether executive or otherwise) of the ABS.
Under the ABS’s governance arrangements, the Executive Board, the 2021 Census Executive Board, and the Statistical Business Transformation (SBT) Executive Program Board are decision making boards in the ABS. The ABS has determined that all official members of these boards are KMP of the ABS, namely, the Australian Statistician; the Deputy Australian Statisticians; the General Manager Finance, Risk and Planning Division; the General Manager People, Capability and Communication Division; the General Manager Population and Social Statistics Division; three external 2021 Census Executive Board members; and three external SBT Executive Program Board members.
The Portfolio Minister and Cabinet Ministers are KMP of the ABS. The Portfolio Minister and Cabinet Ministers’ remuneration and other benefits are set by the Remuneration Tribunal, not paid by the ABS, and are disclosed in the Australian Government’s Consolidated Financial Statements.
KMP remuneration is reported in the table below:
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Short-term employee benefits |
2,615 |
1,720 |
|
Board remuneration fees for external board members |
74 |
6 |
|
Post-employment benefits |
399 |
285 |
|
Other long-term benefits |
440 |
206 |
|
Termination benefits |
277 |
- |
|
Total key management remuneration expenses1 |
3,805 |
2,217 |
Short-term employee benefits include salary, motor vehicle benefits and other allowances. Post-employment benefits include superannuation. Other long-term benefits include long service leave and annual leave. Refer to the Accounting Policy section in Note 1.1A: Employee Benefits for more detail.
The total number of KMP that are included in the above table is 13, consisting of:
- The Australian Statistician
- Three Deputy Australian Statisticians
- One Deputy Australian Statistician, retired on 19 June 2018
- One Acting Deputy Australian Statistician, acting KMP from 10 July 2017 to 4 August 2017
- The General Manager Finance, Risk and Planning Division
- The General Manager People, Capability and Communication Division
- One Acting General Manager People, Capability and Communication Division, acting KMP from 11 December 2017 to 2 February 2018
- The General Manager Population and Social Statistics Division
- Three external SBT Executive Program Board members
- Three external 2021 Census Executive Board.
1. The above KMP remuneration excludes the remuneration and other benefits of the four external board members who provided their services free of charge to the ABS.
4.2 Related Party Disclosures
AASB 124 Related Party Disclosures requires the ABS to disclose transactions with its related parties. Where KMP has an association with an entity where a conflict has the potential to arise, in addition to the duty to disclose that association, the KMP absents him/herself from both the discussion and the decision-making process.
Related Party Relationships
The ABS is an Australian Government controlled entity. Related parties of the ABS include but are not limited to:
- KMP as outlined in 4.1;
- Close family members of KMP as outlined in 4.1; and
- Organisations controlled by these KMP and their close family members.
Related parties to the ABS also include the Portfolio Minister, Cabinet Ministers and other Australian Government entities.
Transactions with Related Parties
Given the breadth of Government activities, related parties may transact with the government sector in the same capacity as ordinary citizens. Such transactions include the payment or refund of taxes, receipt of a Medicare rebate or higher education loans. These transactions are not disclosed in this note.
In 2017-18, one external member of the ABS’s Statistical Business Transformation Executive Program Board provided consulting services to the ABS for $62,441 (2017: Nil). The contract was entered into on commercial terms.
There were no other loans, grants, guarantees or debts forgiven to any KMP or their close family members or organisation controlled by these KMP and/or by their close family members. Transactions with KMP related entities that occur in the normal course of the ABS’s operations are incidental and conducted on terms no more favourable than similar transactions with other employees or customers. Any vendor relationships with such entities are at arm’s length and comply with the ABS’s procurement policy.
All transactions were conducted under normal terms and conditions and exclude the GST.
Other Related Parties Disclosures
- The Australian Statistician is a non-judicial member of the Australian Electoral Commission.
- One Deputy Australian Statistician is a member of the Australian Institute of Health and Welfare (Board).
Managing Uncertancies
This section analyses how the Australian Bureau of Statistics manages the financial risks within its operating environment.
5.1 Contingent Assets and Liabilities
The ABS had no contingent assets or liabilities as at 30 June 2018 for departmental and administered (2017: Nil).
5.2 Financial Instruments
|
2018 |
2017 |
|
|
$'000 |
$'000 |
|
|
Note 5.2A: Categories of Financial Instruments |
||
|
Financial Assets |
||
|
Loans and receivables |
||
|
Cash and cash equivalents |
2,234 |
3,763 |
|
Trade and other receivables |
3,395 |
6,175 |
|
Total financial assets |
5,629 |
9,938 |
|
Financial Liabilities |
||
|
Financial liabilities measured at amortised cost |
||
|
Trade creditors and accruals |
23,415 |
16,785 |
|
Total financial liabilities |
23,415 |
16,785 |
|
Note 5.2B: Net Losses on Financial Assets |
2018 |
2017 |
|
Loans and receivables |
||
|
Impairment |
5 |
8 |
|
Net losses on financial assets |
5 |
8 |
Visit
https://www.transparency.gov.au/annual-reports/australian-bureau-statistics/2018/financial-statements/annual-financial-statements