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Australian Financial Security Authority Annual Report 2019-20

1. Departmental Financial Performance

This section analyses the financial performance of the Australian Financial Security Authority for the year ended 30 June 2020.

1.1 Expenses

Note 1.1A Employee Benefits
	2020 $'000	2019 $'000
Wages and salaries	37,257	37,574
Superannuation
Defined contribution plans	5,510	4,783
Defined benefit plans	1,711	2,110
Leave and other entitlements	5,027	4,953
Separation and redundancies	292	954
Other employee expenses	629	645
Total employee benefits	50,426	51,019

Accounting Policy Accounting policies for employee related expenses are contained in the People and Relationships section.

Note 1.1B: Suppliers
	2020 $'000	2019 $'000
Goods and services supplied or rendered
Consultants	4,321	2,175
Contractors	9,789	8,752
IT costs	3,987	3,662
PPSR retrieval searches	2,500	2,500
Property operating expense	592	480
Travel	664	1,443
Media and publications	698	1,016
Audit fees (internal and external)	628	639
Bank fees	651	677
General admin expenses	1,476	2,000
Other	1,558	1,986
Total goods and services supplied or rendered	26,864	25,330

Goods supplied	374	638
Services rendered	26,490	24,692
Total goods and services supplied or rendered	26,864	25,330

Other suppliers
Operating lease rentals¹	10,182	13,255
Workers compensation expenses	550	1,227
Total other suppliers	10,732	14,482
Total suppliers	37,596	39,812

_{1. AFSA has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.}

AFSA has short-term lease commitments of $nil as at 30 June 2020. The above lease disclosures should be read in conjunction with the accompanying notes 1.1C, 1.2B, 3.2A and 3.4A.

Accounting Policy *Short-term leases* AFSA 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. AFSA recognises the lease payments associated with these leases as an expense on a straightline basis over the lease term.

Note 1.1C: Finance Costs
	2020 $'000	2019 $'000
Finance leases¹	-	-
Interest on lease liabilities	375	-
Unwinding of make-good discount	21	21
Total finance costs	396	21

_{1. AFSA has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.}

The above lease disclosures should be read in conjunction with the accompanying notes 1.1B, 1.2B, 3.2A and 3.4A.

Note 1.1D: Write-Downs and Impairment of Other Assets
	2020 $'000	2019 $'000
Impairment of Intangible assets	46	-
Asset write-downs - property, plant and equipment	55	34
Total write-down and impairment of other assets	101	34

1.2 Own-Source Revenue and Gains

Note 1.2A: Revenue from Contracts with Customers
Own-Source Revenue	2020 $'000	2019 $'000
PPSR	39,558	40,912
Other	2,148	2,275
Total write-down and impairment of other assets	41,706	43,187

Disaggregation of revenue from contracts with customers
Major product / service line:
PPSR registrations	19,773	20,675
PPSR searches	19,785	20,260
Personal Insolvency Reporting Service charges	1,890	1,994
Special account management fee	258	258
	41,706	43,187
Type of customer:
Australian Government entities (related parties)	1	3
State and Territory Governments	1	2
Non-government entities	41,704	43,182
	41,706	43,187
Timing of transfer of goods and services:
Point in time	41,706	43,187
	41,706	43,187

Accounting Policy Revenue from the sale of services is recognised when control has been transferred to the user. AFSA has assessed that the timing for transfer of its services is at a point in time for all its revenue streams. The following is a description of principal activities from which the AFSA generates its revenue: Operation of the Personal Property & Security Register (PPSR) - Revenue generated by AFSA is from the use of the PPSR such as registering a security or interest, amending an existing registration and searches of the register. A contract exists between the party applying for additions to, amendment of and searches of the register. The performance obligation is for the Registrar to action those requests by either registering the interest, amending the existing interest or providing the results of the search of the register. This performance obligation is satisfied once successful payment of the relevant fee has been made, therefore the revenue is recognised at this point in time. The transaction price is determined by the Personal Property Securities (Fees) Determination 2005. Personal Insolvency Reporting Service – Revenue generated by AFSA is from the use, by way of searches, of the National Personal Insolvency Index (NPII). The index is a publicly available and permanent electronic record of all personal insolvency proceedings in Australia. 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 end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

Note 1.2B: Other Revenue
	2020 $'000	2019 $'000
Resources received free of charge - external audit fees	309	306
Reimbursement of legal and estate management costs	72	530
Total other revenue	381	836

Accounting Policy 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. The 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.

Note 1.2C: Revenue from Government
	2020 $'000	2019 $'000
Appropriations
Departmental appropriations	53,583	52,254
Total revenue from Government	53,583	52,254

Accounting Policy Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as revenue when AFSA 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.

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