Notes to the Financial Statements
1. Funding
This section identifies the AEC's funding structure and the funds available to the AEC.
1.1 Revenue from Government
Accounting Policy |
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Revenue from Government |
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Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the AEC 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. |
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Notes |
2019 |
2018 |
|
$000 |
$000 |
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Appropriations |
|||
Departmental appropriation - operating |
387,611 |
146,298 |
|
Departmental Special Appropriations |
14,900 |
14,900 |
|
Total Revenue from Government |
402,511 |
161,198 |
|
1.1B: Annual Appropriations ("recoverable GST exclusive") |
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Notes |
2019 |
2018 |
|
$’000 |
$’000 |
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Ordinary annual services |
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Annual appropriation |
|||
Operating |
|||
Operating |
387,611 |
146,298 |
|
Section 74 receipts of PGPA Act |
20,553 |
18,043 |
|
Total operating appropriation |
408,164 |
164,341 |
|
Capital Budget |
13,572 |
22,370 |
|
Total |
421,736 |
186,711 |
|
Appropriation applied |
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Operating1 |
(365,654) |
(147,900) |
|
Capital |
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Departmental Capital Budget |
(14,619) |
(4,426) |
|
Total capital appropriation applied |
(14,619) |
(4,426) |
|
Total appropriation applied |
(380,273) |
(152,326) |
|
Variance1,2 |
41,463 |
34,385 |
|
1. Operating appropriation applied includes the utilisation of existing cash of $11.7m to support the six by-elections held in 2018-19. This is subject to departmental funding supplementation in the 2019-20 financial year. |
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2. The variance relates to the timing of the federal election and associated receipt/payment of invoices. This will be drawn down early in the 2019-20 financial year to pay supplier liabilities. |
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1.1C: Unspent Annual Appropriations ('Recoverable GST exclusive') |
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2019 |
2018 |
||
$’000 |
$’000 |
||
Departmental |
|||
Cash and cash equivalents |
|||
Appropriation Act 1 - 2018-19 - Cash |
2,402 |
- |
|
Appropriation Act 1 - 2017-18 - Cash |
- |
1,715 |
|
Total Cash and cash equivalents |
2,402 |
1,715 |
|
Appropriations Receivable |
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Appropriation Act 1 - 2018-19 |
133,180 |
- |
|
Appropriation Act 3 - 2018-19 |
1,919 |
- |
|
Appropriation Act 1 - 2018-19 - Departmental Capital Budget |
13,572 |
- |
|
Appropriation Act 1 - 2017-181 |
4,000 |
70,416 |
|
Appropriation Act 3 - 2017-18 |
- |
23,142 |
|
Appropriation Act 1 - 2017-18 - Departmental Capital Budget |
- |
9,389 |
|
Appropriation Act 3 - 2017-18 - Departmental Capital Budget |
6,356 |
11,586 |
|
Appropriation Act 1 - 2016-17 |
- |
3,031 |
|
Total Appropriations Receivable |
159,027 |
117,564 |
|
Total departmental |
161,429 |
119,279 |
|
1. Includes $4m of appropriations that are quarantined and unavailable for AEC use. |
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1.1D: Special Appropriations ('Recoverable GST exclusive') |
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Authority |
Appropriation applied |
||
2019 |
2018 |
||
$'000 |
$'000 |
||
Commonwealth Electoral Act 1918 (Departmental) |
14,900 |
14,900 |
|
Commonwealth Electoral Act 1918 (Administered) |
55,077 |
730 |
|
Total special appropriations applied |
69,977 |
15,630 |
|
No entities spent money from the Consolidated Revenue Fund on behalf of the AEC. |
1.2 Own-Source Revenue and Gains
1.2A: Sale of Goods and Rendering of Services |
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2019 |
2018 |
|
$000 |
$000 |
|
Sale of goods1 |
9,873 |
9,950 |
Rendering of services |
2,418 |
7,335 |
Total sale of goods and rendering of services |
12,291 |
17,285 |
1. Sale of goods represents revenue received from state governments for the management of the electoral roll. |
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Accounting Policy |
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Revenue from the sale of goods is recognised when: |
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a. the risks and rewards of ownership have been transferred to the buyer; and |
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b. the AEC retains no managerial involvement or effective control over the goods. |
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The stage of completion of contracts at the reporting date is determined by reference to the proportion that costs incurred to date compared with the estimated total costs of the transaction. |
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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. |
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1.2B: Other Revenue |
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2019 |
2018 |
|
$000 |
$000 |
|
Other |
98 |
90 |
Resources received free of charge |
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Remuneration of auditors |
88 |
85 |
Other |
63 |
98 |
Total other revenue |
249 |
273 |
Accounting Policy |
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Resources Received Free of Charge |
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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. |
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1.2C: Gains |
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2019 |
2018 |
|
$000 |
$000 |
|
Makegood Gains |
79 |
46 |
Gains from sale of assets |
- |
1 |
Total gains |
79 |
47 |
1.3 Special Accounts
2019 |
2018 |
|
$'000 |
$'000 |
|
Services for other Entities and Trust Monies (SOETM) |
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Balance brought forward from previous period |
1,328 |
1,285 |
Increases |
3,483 |
55 |
Total increases |
3,483 |
55 |
Available for payments |
4,811 |
1,340 |
Decreases |
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Administered |
538 |
12 |
Total Administered |
538 |
12 |
Total decreases |
538 |
12 |
Total balance carried to the next period |
4,273 |
1,328 |
Balance represented by: |
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Cash held in AEC bank accounts |
- |
- |
Cash held in the Official Public Account |
4,273 |
1,328 |
1. Appropriation: Public Governance, Performance and Accountability Act 2013 section 80. Establishing Instrument: Financial Management and Accountability Act 1997 section 20. Purpose: for the expenditure of monies temporarily held in trust or otherwise for the benefit of a person other than the Commonwealth. For example, candidate deposits. |
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2. The entity has a services for other entities and trust monies special account. This account was established under section 78 of the Public Governance, Performance and Accountability Act 2013 (PGPA Act) Determination 2012/04 dated 30 May 2012. For the year ended 30 June 2019 the account has a balance of $4,273k. |
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3. The closing balance of special account services for other Entities and Trust Monies (SOETM) includes amounts held in trust: $4,273k in 2019, and $1,328k in 2018. See 5.6A Assets Held in Trust for more information. |
1.4 Net Cash Appropriation Arrangements
Net cash appropriation arrangements 1 |
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2019 |
2018 |
||
$’000 |
$’000 |
||
Total comprehensive income/(loss) less depreciation/amortisation expenses previously funded through revenue appropriations 2 |
(7,119) |
15,954 |
|
Plus: depreciation/amortisation expenses previously funded through revenue appropriation |
(12,367) |
( 9,500) |
|
Total comprehensive (loss) / income - as per the Statement of Comprehensive Income |
(19,486) |
6,454 |
|
1. From 2010-11, the Government introduced net cash appropriation arrangements where revenue appropriations for depreciation/amortisation expenses ceased. Entities now receive a separate capital budget provided through equity appropriations. Capital budgets are to be appropriated in the period when cash payment for capital expenditure is required. |
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2. The AEC's loss is a result of the conduct of six by-elections during the 2018-19 financial year. The AEC's ongoing annual funding model does not support the delivery of by-elections due to their unpredictable nature. As a result it is normal business for the AEC to seek departmental funding supplementation each time a by-election is delivered. The AEC has secured departmental funding supplementation of $11.7m through its 2019-20 appropriations to cover the costs of the six by-elections. |
Departmental Financial Position and Managing Uncertainties
This section analyses the AEC's assets used to conduct its operations and the operating liabilities incurred as a result and how the AEC manages financial risks related to these and its operating environment. Employee related information is disclosed in the People and Relationships section.
2.1 Financial Instruments
2.1A: Categories of Financial Instruments
2019 |
2018 |
|
$000 |
$000 |
|
FINANCIAL ASSETS UNDER AASB 139 |
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Loans and receivables |
||
Cash and cash equivalents |
1,715 |
|
Receivables |
||
Receivables for goods and services |
896 |
|
Total receivables |
2,611 |
|
Total loans and receivables |
2,611 |
|
FINANCIAL ASSETS UNDER AASB 9 |
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Cash and cash equivalents |
2,402 |
|
Receivables |
1,583 |
|
Total financial assets at amortised cost |
3,985 |
|
FINANCIAL LIABILITIES |
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Financial liabilities measured at amortised cost |
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Supplier payables |
71,254 |
7,252 |
Finance Lease rentals |
- |
2,642 |
Total financial liabilities measured at amortised cost |
71,254 |
9,894 |
Total financial liabilities |
71,254 |
9,894 |
Credit terms for goods and services were within 30 days (2018: 30 days). Settlement of suppliers payable is usually made within 30 days. |
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Nil movement in Impairment allowance for the period (2018: $10,000) has been recognised in relation to loans and receivables and included in the net cost of service. $16,892 (2018: $4,000) has been written off. |
Classification of financial assets on the date of initial application of AASB 9
Classification of financial assets on the date of initial application of AASB 9. |
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Financial assets class |
AASB 139 original classification |
AASB 9 new classification |
AASB 139 carrying amount at 1 July 2018 $'000 |
AASB 9 carrying amount at 1 July 2018 $'000 |
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Cash and Cash Equivalents |
Amortised Cost |
Amortised Cost |
1,715 |
1,715 |
||
Trade receivables |
Loans and receivables |
Amortised Cost |
896 |
896 |
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Total financial assets |
2,611 |
2,611 |
Reconciliation of carrying amounts of financial assets on the date of initial application of AASB 9
Reconciliation of carrying amounts of financial assets on the date of initial application of AASB 9 |
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Financial assets class |
AASB 139 carrying amount at 30 June 2018 $'000 |
Reclassification $'000 |
Remeasurement $000 |
AASB 9 carrying amount at 1 July 2018 $000 |
Financial assets at amortised cost |
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Cash and Cash Equivalents |
1,715 |
- |
1,715 |
|
Trade receivables |
896 |
- |
896 |
|
Total amortised cost |
2,611 |
- |
2,611 |
|
1. There was NIL change in the carrying amount based on the measurement under AASB 139. The change in measurement on transition to AASB 9 is NIL. |
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2. There are no changes in classification and measurement of financial liabilities. |
Accounting Policy
Financial assets |
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With the implementation of AASB 9 Financial Instruments for the first time in 2019, the entity classifies its financial assets in the following categories: |
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a. financial assets at fair value through profit or loss; |
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b. financial assets at fair value through other comprehensive income; and |
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c. financial assets measured at amortised cost. |
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The classification depends on both the entity's business model for managing the financial assets and contractual cash flow characteristics at the time of initial recognition. Financial assets are recognised when the entity becomes a party to the contract and, as a cosequence, has a legal right to receive or a legal obligation to pay cash and derecognised when the contractual rights to the cash flows from the financial asset expire or are transferred upon trade date. |
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Comparatives have not been restated on initial application. |
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Financial Assets at Amortised Cost |
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Financial assets included in this category need to meet two criteria: |
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1. the financial asset is held in order to collect the contractual cash flows; and |
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2. the cash flows are solely payments of principal and interest (SPPI) on the principal outstanding amount. |
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Amortised cost is determined using the effective interest method. |
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Effective Interest Method |
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Income is recognised on an effective interest rate basis for financial assets that are recognised at amortised cost. |
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Impairment of Financial Assets |
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Financial assets are assessed for impairment at the end of each reporting period based on Expected Credit Losses, using the general approach which measures the loss allowance based on an amount equal to lifetime expected credit losses where risk has significantly increased, or an amount equal to 12-month expected credit losses if risk has not increased. |
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The simplified approach for trade, contract and lease receivables is used. This approach always measures the loss allowance as the amount equal to the lifetime expected credit losses. |
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A write - off constitutes a derecognition event where the write-off directly reduces the gross carrying amount of the financial asset. |
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Financial liabilities
Financial liabilities are classified as either financial liabilities 'at fair value through profit or loss' or other financial liabilities. Financial liabilities are recognised and derecognised upon 'trade date'. |
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Financial Liabilities at Fair Value Through Profit or Loss |
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Financial liabilities at fair value through profit or loss are initially measured at fair value. Subsequent fair value adjustments are recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liablility. |
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Financial Liabilities at Amortised Cost |
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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). |
Accounting Judgements and Estimates
Financial assets have been assessed for impairment at the end of the reporting period based on Expected Credit Losses. No credit loss has been identified. |
2.2 Other Financial Assets
2.2A: Appropriation Receivable
2.2A: Appropriation Receivable |
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2019 $’000 |
2018 $’000 |
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Appropriation receivables |
159,027 |
117,564 |
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Total Appropriation receivable |
159,027 |
117,564 |
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Accounting Policy |
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Refer to Note 1.1. |
2.2B: Other Receivables
2019 $000 |
2018 $000 |
|
Statutory receivables |
8,383 |
861 |
Comcare payments |
63 |
102 |
Total other receivables |
8,446 |
963 |
Other Receivables are not past due or impaired. |
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Accounting Policy |
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Statutory receivables are amounts owed to the AEC from the Australian Taxation Office in relation to the refund of GST collected. |
2.3 Non-financial assets
2.3A: Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment and Intangibles
Reconciliation of the opening and closing balances of property, plant and equipment and intangibles for 2019 |
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Leasehold Improvements |
Plant & Equipment2 |
Computer Software1 |
Intellectual Property |
Total |
|
$’000 |
$’000 |
$’000 |
$’000 |
$’000 |
|
As at 1 July 2018 |
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Gross book value |
7,023 |
7,485 |
58,180 |
2,304 |
74,992 |
Accumulated depreciation, amortisation and impairment |
(266) |
(212) |
(49,703) |
(641) |
(50,822) |
Total as at 1 July 2018 |
6,757 |
7,273 |
8,477 |
1,663 |
24,170 |
Additions |
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Purchase |
1,942 |
1,536 |
11,864 |
126 |
15,468 |
Lease |
- |
2,007 |
- |
- |
2,007 |
Revaluations and impairments recognised in other comprehensive income |
2,882 |
2,048 |
- |
- |
4,930 |
Depreciation and amortisation |
(2,747) |
(7,188) |
(2,243) |
(189) |
(12,367) |
Disposals |
- |
- |
(233) |
- |
(233) |
Total as at 30 June 2019 |
8,834 |
5,675 |
17,865 |
1,600 |
33,974 |
Total as at 30 June 2019 represented by |
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Gross book value |
9,401 |
10,594 |
69,604 |
2,430 |
92,029 |
Accumulated depreciation, amortisation and impairment |
(567) |
(4,919) |
(51,739) |
(830) |
(58,055) |
Total as at 30 June 2019 represented by |
8,834 |
5,675 |
17,865 |
1,600 |
33,974 |
1. The carrying amount of computer software included $14,706,891 of purchased software and $3,156,382 of internally generated software. |
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2. Leased Plant & Equipment is measured at cost less depreciation. |
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No indicators of impairment were found for property, plant and equipment and intangibles (2018: nil). |
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No property, plant and equipment and intangibles are expected to be sold or disposed of within the next 12 months. |
Revaluations of non-financial assets
All revaluations were conducted in accordance with the revaluation policy stated in this note. On 30 June 2019, an independent valuer conducted the revaluations.
A revaluation increment of $2,882,000 for leasehold improvements (2018: $611,244 decrement) and $2,048,000 for property, plant and equipment (2018: $729,892 increment) was debited to the asset revaluation surplus by asset class and included in the equity section of the statement of financial position.
Contractual commitments for the acquisition of property, plant, equipment and intangible assets
At 30 June 2019 there were no significant contractual commitments for the acquisition of property, plant, equipment and intangible assets.
Fair Value Measurement
Fair Value Measurement1,2,3
The following tables provide an analysis of assets and liabilities that are measured at fair value. The remaining assets and liabilities disclosed in the statement of financial position do not apply the fair value hierarchy.
Fair value measurements |
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2019 |
2018 |
|
$'000 |
$'000 |
|
Non-financial assets |
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Leasehold improvements |
8,834 |
6,757 |
Plant and equipment |
5,675 |
7,273 |
1. Fair value measurements occur each financial year. |
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2. There are no changes in valuation techniques. |
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3. The remaining assets and liabilities reported by the AEC are not measured at fair value in the Statement of Financial Position. |
Accounting Policy
Accounting Policy |
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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. |
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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. |
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Asset Recognition Threshold |
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Purchases of plant and equipment are recognised initially at cost in the statement of financial position, except for purchases costing less than $2,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total). |
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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 ‘makegood’ provisions in property leases taken up by the AEC where there exists an obligation to restore the property to its original condition. These costs are included in the value of the AEC’s leasehold improvements with a corresponding provision for 'make good' recognised. |
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Revaluations |
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Following initial recognition at cost, plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. 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. |
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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. |
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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. |
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Depreciation |
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Depreciable plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the AEC, in all cases, the straight-line method of depreciation. |
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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. |
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Depreciation rates applying to each class of depreciable asset are based on the following useful lives: |
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2019 |
2018 |
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Leasehold improvements |
Lesser of lease term/useful life |
Lesser of lease term/useful life |
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Plant and equipment |
5 to 10 years |
5 to 10 years |
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IT Equipment |
3 to 5 years |
3 to 5 years |
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Impairment |
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All assets were assessed for impairment at 30 June 2019. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount. |
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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 AEC were deprived of the asset, its value in use is taken to be its depreciated replacement cost. |
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Derecognition |
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An item of plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal. |
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Intangibles |
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The AEC's intangibles comprise internally developed software, purchased software and intellectual property for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses. |
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Intangible assets are amortised on a straight-line basis over its anticipated useful life. The useful lives of the AEC's software are 1 to 10 years (2017: 1 to 10 years) and the useful lives of the AEC's intellectual property are 0 to 4 years (2017: 0 to 4 years). |
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All intangible assets were assessed for indications of impairment as at 30 June 2019. |
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2.3B: Inventories
2019 |
2018 |
|
$’000 |
$’000 |
|
Inventories held for distribution |
1,699 |
5,104 |
Total inventories |
1,699 |
5,104 |
Accounting Policy
Inventories held for distribution are valued at cost, adjusted for any loss of service potential. Costs incurred in bringing each item of inventory to its present location and condition are assigned as follows:
a. raw materials and stores – purchase cost on a first-in-first-out basis
b. finished goods and work-in-progress – cost of direct materials and labour plus attributable costs that can be allocated on a reasonable basis.
Inventories acquired at no cost or nominal consideration are initially measured at current replacement cost at the date of acquisition.
2.3C: Other Non-Financial Assets
2019 |
2018 |
|||||
$’000 |
$’000 |
|||||
Prepayments |
3,898 |
2,773 |
||||
Total other non-financial assets |
3,898 |
2,773 |
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No indicators of impairment were found for other non-financial assets (2018: nil). |
2.4 Other Payables and Provisions
2.4A: Other Payables
2019 |
2018 |
|
$’000 |
$’000 |
|
Salaries and wages |
999 |
708 |
Superannuation |
119 |
88 |
Separations and redundancies |
- |
152 |
Lease incentives |
1,724 |
2,378 |
Straight-line leases |
691 |
582 |
Total other payables |
3,533 |
3,908 |
Accounting Policy
Parental Leave Payments Scheme
Amounts received under the Parental Leave Payments Scheme by the AEC not yet paid to employees were presented as cash and a liability (payable). The total amount received under this scheme was $144,133 (2018: $56,407).
Employee Benefits
Refer to Note 3.2.
Leases
Refer to Note 4.1A.
2.4B: Other Provisions
Provision for restoration $000 |
|
As at 1 July 2018 |
1,780 |
Additional provisions made |
233 |
Amounts used |
- |
Amounts reversed |
(42) |
Revaluation of provision |
3,841 |
Unwinding of discount or change in discount rate |
(37) |
Total as at 30 June 2019 |
5,775 |
The AEC currently has 38 (2018: 32) agreements for the leasing of premises which have provisions requiring the AEC to restore the premises to their original condition at the conclusion of the lease. The AEC has made a provision to reflect the present value of this obligation. |
2.5 Contingent Assets and Liabilities
Contingent Assets |
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At 30 June 2019, the AEC had no contingent assets (2018: nil). |
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Contingent Liabilities |
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At 30 June 2019, the AEC had no contingent liabilities (2018: nil). |
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Quantifiable Contingencies |
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At 30 June 2019, the AEC had no quantifiable contingencies (2018: nil). |
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Unquantifiable Contingencies |
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At 30 June 2019, the AEC had no unquantifiable contingencies (2018: nil). |
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Significant Remote Contingencies |
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The AEC has no significant remote contingencies (2018: nil). |
Accounting Policy
Contingent liabilities and contingent assets are not recognised in the statement of financial position but are reported in the notes. They may arise from uncertainty as to the existence of a liability or asset or represent an asset or liability in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.
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.
3.1 Employee Benefits
2019 |
2018 |
|
$’000 |
$’000 |
|
Wages and salaries1 |
157,783 |
64,334 |
Superannuation: |
||
Defined contribution plans |
6,959 |
5,693 |
Defined benefit plans |
7,359 |
6,022 |
Leave and other entitlements |
4,998 |
6,502 |
Separation and redundancies |
722 |
4,128 |
Total employee benefits |
177,821 |
86,679 |
1. The AEC engaged a significant number of additional staff on a temporary basis to deliver the 2019 federal election. |
3.2 Employee provisions
2019 $'000 |
2018 $'000 |
|
Leave |
21,029 |
22,251 |
Total employee provisions |
21,029 |
22,251 |
Accounting Policy
Accounting policy
Liabilities for short-term employee benefits and termination benefits expected within twelve months of the end of reporting period are measured at their nominal amounts.
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. The leave liabilities are calculated on the basis of employees' remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the entity's superannuation contribution rates 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 shorthand method as at 30 June 2019. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.
Superannuation
The AEC's staff are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), or the PSS accumulation plan (PSSap), or other superannuation funds held outside the Australian Government.
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.
The AEC makes employer contributions to the employees' defined benefit superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government. The AEC 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.
3.3 Key Management Personnel Remuneration
Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the AEC, directly or indirectly, including any director (whether executive or otherwise) of the AEC. The AEC has determined the key management personnel to be the Electoral Commissioner, Deputy Electoral Commissioner and the two First Assistant Commissioners. Key management personnel remuneration is reported in the table below: |
||
2019 |
2018 |
|
$’000 |
$’000 |
|
Short-term employee benefits |
1,368 |
1,314 |
Post-employment benefits |
216 |
209 |
Other long-term employee benefits |
32 |
28 |
Total key management personnel remuneration expenses1 |
1,616 |
1,551 |
The total number of key management personnel that are included in the above table is 4 (2018: 4). |
||
During the year the number of positions included in key management personnel was 4 (2018:4). |
||
1. The above key management personnel remuneration excludes the remuneration and other benefits of the Portfolio Minister. The Portfolio Minister's remuneration and other benefits are set by the Remuneration Tribunal and are not paid by the AEC. |
3.4 Related Party Disclosures
Related party relationships: |
|||
The AEC is an Australian Government controlled entity. Related parties to the AEC are Key Management Personnel, the Portfolio Minister and Executive, 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 have not been separately disclosed in this note. |
|||
Significant transactions with related parties can include: ● the payments of grants or loans; ● purchases of goods or services; ● receipts to provide services; ● payments for superannuation; and ● asset purchases, sales transfers or leases. Giving consideration to relationships with related entities, and transactions entered into during the reporting period by the entity, it has been determined that there are no related party transactions to be separately disclosed. |
Other information
This section includes additional financial information that is either required by AAS or the PGPA FRR or is relevant to assist users in understanding the financial statements.
4.1 Expenses
4.1A: Suppliers
2019 $000 |
2018 $000 |
|
Goods and services supplied or rendered |
||
Consultants |
3,367 |
914 |
Contractors |
81,435 |
18,433 |
Travel |
6,535 |
4,464 |
IT services |
21,591 |
14,577 |
Employee Related Expenses |
3,980 |
2,249 |
Inventory |
17,949 |
3,349 |
Furniture and venue hire |
14,329 |
726 |
Property |
11,048 |
4,826 |
Mail and Freight |
31,005 |
6,049 |
Office Supplies |
2,216 |
1,091 |
Advertising |
22,212 |
1,520 |
Printing |
167 |
511 |
Other |
1,471 |
1,131 |
Total goods and services supplied or rendered |
217,305 |
59,840 |
Goods supplied |
71,704 |
17,149 |
Services rendered |
145,601 |
42,691 |
Total goods and services supplied or rendered |
217,305 |
59,840 |
Other suppliers |
||
Operating lease rentals |
26,199 |
13,288 |
Lease restoration |
233 |
262 |
Workers compensation expenses |
1,530 |
2,597 |
Total other suppliers |
27,962 |
16,147 |
Total suppliers |
245,267 |
75,987 |
Leasing Commitments
The AEC in its capacity as a lessee, leases office accommodation and storage that are effectively non‑cancellable. The lease payments can be varied periodically to take account of an annual Consumer Price Index increase, a fixed increase or a market increase. Commitments are GST inclusive where relevant. |
||
Commitments for minimum lease payments in relation to non-cancellable operating leases are payable as follows: |
||
2019 $000 |
2018 $000 |
|
Within 1 year |
18,182 |
15,061 |
Between 1 to 5 years |
18,304 |
30,569 |
More than 5 years |
- |
- |
Total operating lease commitments |
36,486 |
45,630 |
Accounting Policy |
||
Operating lease payments are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets. |
4.1B: Impairment loss allowance on financial instruments
2019 |
2018 |
|
$’000 |
$’000 |
|
Impairment on trade and other receivables |
17 |
(6) |
Total impairment on financial instruments |
17 |
(6) |
Items Administered on Behalf of Government
This section analyses the activities that the AEC does not control but administers on behalf of the Government. Unless otherwise noted, the accounting policies adopted are consistent with those applied for departmental reporting.
5.1 Administered - Expenses
5.1A: Other Expenses
2019 |
2018 |
||||||
$'000 |
$'000 |
||||||
Refunds - electoral fines/penalties |
9 |
- |
|||||
Political Party funding |
79,493 |
618 |
|||||
Total other expenses |
79,502 |
618 |
5.2 Administered - Income
5.2A: Fees and Fines
2019 |
2018 |
||||||
$000 |
$000 |
||||||
Revenue |
|||||||
Non-Taxation revenue |
|||||||
Electoral fines/penalties |
1,026 |
269 |
|||||
Party Registration |
27 |
6 |
|||||
Total fees and fines |
1,053 |
275 |
|||||
Accounting Policy |
|||||||
All administered revenues are revenues relating to ordinary activities performed by the AEC on behalf of the Australian Government. As such, administered appropriations are not revenues of the individual entity that oversees distribution or expenditure of the funds as directed. |
|||||||
Fines are charged for non-voters of federal elections, by-elections and referendums. Administered fee revenue is recognised when received. |
|||||||
Each nomination for the Senate and the House of Representatives must be accompanied by a deposit. |
|||||||
5.3 Administered - assets and liabiities
5.3A: Cash and Cash Equivalents
2019 |
2018 |
|||||
$’000 |
$’000 |
|||||
Cash and cash equivalents |
2 |
- |
||||
Total cash and cash equivalents |
2 |
- |
||||
The closing balance of Cash in special accounts does not include amounts held in trust: [$4,273k in 2019 and $1,328k in 2018]. See note 1.3 Special Accounts and 5.6A Assets Held in Trust for more information. |
5.3B: Suppliers
2019 |
2018 |
|
$000 |
$000 |
|
Trade creditors and accruals |
24,706 |
- |
Total suppliers |
24,706 |
- |
Settlement of suppliers payable is usually made within 30 days. |
5.4 Administered - financial instruments
2019 |
2018 |
|||||
$’000 |
$’000 |
|||||
Categories of Financal Instruments |
||||||
Financial Assets under AASB 9 |
||||||
Financial assets at amortised cost |
||||||
Cash and cash equivalents |
2 |
- |
||||
Total financial assets at amortised cost |
2 |
- |
||||
Total financial assets |
2 |
- |
||||
Financial Liabilities |
||||||
Financial liabilities measured at amortised cost |
||||||
Trade creditors and accruals |
24,706 |
- |
||||
Total financial liabilities measured at amortised cost |
24,706 |
- |
||||
Total financial liabilities |
24,706 |
- |
||||
Classification of financial assets on the date of initial application of AASB 9. |
||||||
Financial assets class |
AASB 139 original classification |
AASB9 new classification |
AASB 139 carrying amount at 1 July 2018 $'000 |
AASB 9 carrying amount at 1 July 2018 $'000 |
||
Cash and Cash Equivalents |
Amortised Cost |
Amortised Cost |
2 |
2 |
||
Total financial assets |
2 |
2 |
||||
AEC did not have any administered Financial assets or liabilities as at 30 June 2018, and did not have any changes in carrying amounts based on the transition to AASB 9. |
||||||
Receivables (net) are expected to be recovered within 30 days (2018: within 30 days) |
||||||
Credit terms for goods and services were within 30 days (2018: 30 days). Settlement of suppliers payable is usually made within 30 days. |
5.5 Administered - contingent liabilities
There are no administered contingencies, remote or quantifiable, for the AEC (2018: nil). |
5.6 Administered - assets held in trust
5.6A: Assets Held in Trust |
|||||||
The trust account holds the roll objections, and candidate deposits. When certain conditions are met the funds are returned. |
|||||||
2019 |
2018 |
||||||
$’000 |
$’000 |
||||||
Candidate Deposits |
|||||||
As at 1 July |
1,328 |
1,285 |
|||||
Receipts |
3,483 |
55 |
|||||
Payments |
538 |
12 |
|||||
Total as at 30 June |
4,273 |
1,328 |
|||||
Total monetary assets held in trust |
4,273 |
1,328 |
|||||
Non-monetary assets |
|||||||
There are nil non-monetary assets held in trust |
6. Aggregate information
6.1A: Aggregate Assets and Liabilities
2019 |
2018 |
|
$’000 |
$’000 |
|
Assets expected to be recovered in: |
||
No more than 12 months |
175,173 |
123,330 |
More than 12 months |
35,856 |
29,855 |
Total assets |
211,029 |
153,185 |
Liabilities expected to be settled in: |
||
No more than 12 months |
92,991 |
30,296 |
More than 12 months |
8,600 |
7,537 |
Total liabilities |
101,591 |
37,833 |
6.1B: Administered - Aggregate Assets and Liabilities
2019 |
2018 |
|
$’000 |
$’000 |
|
Assets expected to be recovered in: |
||
No more than 12 months |
2 |
- |
Total assets |
2 |
- |
Liabilities expected to be settled in: |
||
No more than 12 months |
24,706 |
- |
Total liabilities |
24,706 |
- |
Visit
https://www.transparency.gov.au/annual-reports/australian-electoral-commission/reporting-year/2018-2019-47