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Audited financial statements

 • Statement by the Accountable Authority and Chief Financial Officer; • Statement of Comprehensive Income; • Statement of Financial Position; • Statement of Changes in Equity; • Cash Flow Statement; and • Notes to the financial statements, comprising a summary of significant accounting policies and other explanatory information. Basis for opinion I conducted my audit in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Auditing Standards. My responsibilities under those standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of my report. I am independent of the Entity in accordance with the relevant ethical requirements for financial statement audits conducted by the Auditor-General and his delegates. These include the relevant independence requirements of the Accounting Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the Code) to the extent that they are not in conflict with the Auditor-General Act 1997. I have also fulfilled my other responsibilities in accordance with the Code. I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my opinion. Accountable Authority’s responsibility for the financial statements As the Accountable Authority of the Entity, the Director is responsible under the Public Governance, Performance and Accountability Act 2013 (the Act) for the preparation and fair presentation of annual financial statements that comply with Australian Accounting Standards – Reduced Disclosure Requirements and the rules made under the Act. The Director is also responsible for such internal control as the Director determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the Director is responsible for assessing the ability of the Entity to continue as a going concern, taking into account whether the Entity’s operations will cease as a result of an administrative restructure or for any other reason. The Director is also responsible for disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the assessment indicates that it is not appropriate.

 • identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control; • obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Entity’s internal control; • evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Accountable Authority; • conclude on the appropriateness of the Accountable Authority’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Entity’s ability to continue as a going concern. If I conclude that a material uncertainty exists, I am required to draw attention in my auditor’s report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify my opinion. My conclusions are based on the audit evidence obtained up to the date of my auditor’s report. However, future events or conditions may cause the Entity to cease to continue as a going concern; and • evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation. I communicate with the Accountable Authority regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that I identify during my audit. Australian National Audit Office [signature] Jodi George Executive Director Delegate of the Auditor-General Canberra 24 September 2020

STATEMENT BY THE ACCOUNTABLE AUTHORITY AND CHIEF FINANCIAL OFFICER In our opinion, the attached financial statements for the year ended 30 June 2020 comply with subsection 42(2) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), and are based on properly maintained financial records as per subsection 41(2) of the PGPA Act. In our opinion, at the date of this statement, there are reasonable grounds to believe that the Australian Institute of Criminology will be able to pay its debts as and when they fall due. Signed Michael Phelan APM Director 24 September 2020 Yvette Whittaker Chief Financial Officer 24 September 2020

Statement of comprehensive income

for the period ended 30 June 2020

2020

Budget

2020

2019

Notes

$

$

$

NET COST OF SERVICES

Expenses

Employee benefits

1.1A

2,657,728

3,373,000

2,167,030

Suppliers

1.1B

3,708,766

3,325,000

4,139,791

Depreciation and amortisation

2.2A

38,898

61,000

29,403

Total expenses

6,405,391

6,759,000

6,336,223

Own-source revenue

Contracts with customers

1.2A

1,797,451

2,013,000

2,133,556

Royalties

44,518

50,000

37,837

Other revenue

1.2B

41,501

40,000

41,549

Total own-source revenue

1,883,469

2,103,000

2,212,942

Net cost of services

(4,521,922)

(4,656,000)

(4,123,281)

Revenue from Government - Departmental Appropriations

1.2C

4,595,000

4,595,000

4,590,000

Surplus/(Deficit) attributable to the Australian Government

73,078

(61,000)

466,719

OTHER COMPREHENSIVE INCOME

Items not subject to subsequent reclassification to net cost of services

Changes in asset revaluation surplus

-

-

Total other comprehensive income

-

-

Total comprehensive income/(loss) attributable to the Australian Government

73,078

(61,000)

466,719

The above statement should be read in conjunction with the accompanying notes.

Budget to actual variance commentary: see Note 7 for major variance explanations.

Statement of financial position

as at 30 June 2020

2020

Budget

2020

2019

Notes

$

$

$

ASSETS

Financial assets

Cash and cash equivalents

2.1, 2.4

3,172,055

1,275,000

1,882,684

Trade and other receivables

2.1B

68,722

330,000

529,894

Total financial assets

3,240,777

1,605,000

2,412,578

Non-financial assets

Furniture and office equipment

2.2A

72,242

75,699

95,620

Library collection

2.2A

746,581

782,301

755,791

Intangibles

2.2A

-

21,000

-

Prepayments

70,338

70,000

78,151

Total non-financial assets

889,161

949,000

929,562

Total assets

4,129,938

2,554,000

3,342,140

LIABILITIES

Payables

Suppliers

2.3A

614,934

175,000

352,989

Other payables

2.3B

1,416,546

459,000

985,771

Total payables

2,031,480

634,000

1,338,759

Total liabilities

2,031,480

634,000

1,338,759

Net assets

2,098,458

1,920,000

2,003,380

EQUITY

Contributed equity

1,247,294

1,229,000

1,225,294

Reserves

861,254

861,000

861,254

Accumulated Deficit

(10,089)

(170,000)

(83,168)

Total equity

2,098,458

1,920,000

2,003,380

The above statement should be read in conjunction with the accompanying notes.

Budget to actual variance commentary: see Note 7 for major variance explanations.

Statement of changes in equity

for the period ended 30 June 2020

Retained earnings

Asset revaluation surplus

Contributed equity/capital

Total equity

2020

Budget
2020

2019

2020

Budget
2020

2019

2020

Budget
2020

2019

2020

Budget
2020

2019

$

$

$

$

$

$

$

$

$

$

$

$

Balance carried forward from previous period

(83,168)

(109,000)

(549,887)

861,254

861,000

861,254

1,225,294

1,207,000

1,185,294

2,003,381

1,959,000

1,496,661

Opening balance

(83,168)

(109,000)

(549,887)

861,254

861,000

861,254

1,225,294

1,207,000

1,185,294

2,003,381

1,959,000

1,496,661

Comprehensive income

Surplus (Deficit) for the period

73,078

(61,000)

466,719

-

-

-

-

-

-

73,078

(61,000)

466,719

Total comprehensive income

73,078

(61,000)

466,719

-

-

-

-

-

-

73,078

(61,000)

466,719

Transactions with owners

Contributions by owners

Departmental capital budget1

-

-

-

-

-

-

22,000

22,000

40,000

22,000

22,000

40,000

Total transactions with owners

-

-

-

-

-

-

22,000

22,000

40,000

22,000

22,000

40,000

Closing balance as at 30 June

(10,090)

(170,000)

(83,168)

861,254

861,000

861,254

1,247,294

1,229,000

1,225,294

2,098,458

1,920,000

2,003,380

1. Amounts appropriated which are designated as 'Departmental capital budgets' are recognised directly in transactions with owners in that year.

The above statement should be read in conjunction with the accompanying notes.

Budget to actual variance commentary: see Note 7 for major variance explanations.

Cash flow statement

for the period ended 30 June 2020

2020

Budget
2020

2019

$

$

$

OPERATING ACTIVITIES

Cash received

Appropriations1

4,705,711

4,595,000

4,590,000

Contracts with customers

2,631,570

2,013,000

2,427,003

Net GST received

236,287

-

110,711

Other

44,518

50,000

37,837

Total cash received

7,618,086

6,658,000

7,165,551

Cash used

Employees

2,657,728

3,373,000

2,167,030

Suppliers

3,667,441

3,285,000

3,895,223

Section 74 receipts transferred to Official Public Account

-

-

110,711

Total cash used

6,325,170

6,658,000

6,172,964

Net cash from operating activities

1,292,916

-

992,587

INVESTING ACTIVITIES

Cash used

Purchase of property, plant and equipment and intangibles

6,310

22,000

86,760

Total cash used

6,310

22,000

86,760

Net cash (used by) investing activities

(6,310)

(22,000)

(86,760)

FINANCING ACTIVITIES

Cash received

Contributed equity

2,765

22,000

40,000

Total cash received

2,765

22,000

40,000

Net cash from financing activities

2,765

22,000

40,000

Net Increase in cash held

1,289,371

-

945,828

Cash and cash equivalents at the beginning of the reporting period

1,882,684

1,275,000

936,856

Cash and cash equivalents at the end of the reporting period

3,172,055

1,275,000

1,882,684

1 Appropriation amount in 2019-20 includes the receipt of $110,711 appropriation receivable in 2018-19. See Note 3.1B.

The above statement should be read in conjunction with the accompanying notes.

Budget to actual variance commentary: see Note 7 for major variance explanations.

Notes to and forming part of the financial statements

Overview

Objectives of the Australian Institute of Criminology
The Australian Institute of Criminology (AIC) is an Australian Government controlled entity. The objective of the AIC is to inform crime and justice policy and practice in Australia by undertaking, funding and disseminating policy relevant research of national significance; and through the generation of a crime and justice evidence base and national knowledge centre.

The continued existence of the AIC in its present form is dependent on Government policy and on continuing funding by Parliament. The AIC’s activities contributing toward this outcome are classified as departmental. Departmental activities involve the use of assets and income controlled, or liabilities and expenses incurred by the AIC in its own right.

Basis of Preparation of the Financial Statements
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 and notes have been prepared in accordance with:

a) Public Governance, Performance and Accountability (Financial Reporting) Rule 2015 (FRR); and

b) Australian Accounting Standards and Interpretations – Reduced Disclosure Requirements issued by the Australian Accounting Standards Board that apply for the reporting period.

The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities which are carried 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 are rounded to the nearest dollar.

Unless an alternative treatment is specifically required by an accounting standard or the FRR, assets and liabilities are recognised in the statement of financial position when and only when it is probable that future economic benefits will flow to the entity or a future sacrifice of economic benefits will be required and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under executory contracts are not recognised unless required by an accounting standard.

Unless an alternative treatment is specifically required by an accounting standard, income and expenses are recognised in the statement of comprehensive income when and only when the flow, consumption or loss of economic benefits has occurred and can be reliably measured.

New accounting standards

There were a number of new and amending standards and/or interpretations applicable to the current financial year. A summary of the impacts of the new standards for the AIC are as follows:

Application of AASB 15 Revenue from Contracts with Customers and AASB 1058 Income of Not-For-Profit Entities

The AIC applied the core principle of AASB 15 in measuring and recognising revenue at an amount that reflects the consideration entitled in exchange for transferring goods or services to customers.

The ACIC adopted AASB15 using the modified retrospective approach, under which the cumulative effect of initial application is recognised in retained earnings at 1 July 2019. AASB 1058 applies to the recognition and measurement of income where it is not within the scope of AASB 15.

The ACIC applied AASB1058 to recognise income for volunteer services, where the fair value of the services can be reliably measured, and the services would have been purchased if they had not been donated.

  • The impact of AASB 15 is assessed as nil for AIC, as no change will occur to the amount of revenue recognised.
  • The impact of AASB 1058 is assessed as nil for the AIC as these items are already being recognised on the same basis.

Application of AASB 16 Leases

The AIC is not required to apply AASB 16 as it does not have any leases.

Taxation

The AIC is exempt from all forms of taxation except fringe benefits tax (FBT) and the goods and services tax (GST).

Revenues, expenses and assets are recognised net of GST except:
a) where the amount of GST incurred is not recoverable from the Australian Taxation Office; and
b) for receivables and payables.

Comparative figures

Comparative figures for 2019-20 reflect the figures reported in the AIC’s 2018-19 financial statements unless otherwise indicated.

Contingent assets and liabilities

The AIC did not have any quantifiable or unquantifiable contingencies to report for the financial year ended 30 June 2020 (2018-19: Nil).

Events after the reporting period

No subsequent events to report after the balance date.

Note 1.1: Expenses

2020

2019

$

$

Note 1.1A: Employee benefits

Wages and salaries

1,976,839

1,593,417

Superannuation

Defined contribution plans

229,100

176,928

Defined benefit plans

137,875

143,074

Leave and other entitlements

313,914

253,611

Total employee benefits

2,657,728

2,167,030

AIC staff were primarily employed by ACIC for the duration of the year and seconded to the AIC to resource AIC’s ongoing operations. The ACIC initially met all the employee expenses, and claimed reimbursement from the AIC on a monthly basis. Therefore, whilst the employee benefits costs are reflected in the AIC statement of comprehensive income, the AIC does not hold any liabilities or provision in respect to employees in the statement of financial position.

Accounting Policy

Superannuation

The ACIC staff seconded to AIC were 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 PSSap is a defined contribution scheme. The CSS and PSS are defined benefit schemes for the Australian Government. The liability for defined benefit schemes is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course.
This liability is reported by the Department of Finance as an administered item.

The ACIC makes employer contributions to the employees' defined benefit superannuation schemes in respect to the staff seconded to AIC at rates determined by an actuary to be sufficient to meet the current cost to the Government. The ACIC and AIC accounts for the contributions as if they were contributions to defined contribution plans.

2020

2019

$

$

Note 1.1B: Suppliers

Goods and services

Contractors and consultants

1,460,294

1,384,047

Research services

288,913

426,775

Travel

90,203

156,493

Information technology

113,022

112,881

Outsourced corporate expenses1

1,535,350

1,644,621

Conferences and meetings

101,262

276,412

Other

119,722

138,562

Total goods and services

3,708,766

4,139,791

1 Outsourced corporate expenses includes costs of services provided by the ACIC to the AIC.

Note 1.2: Own source revenue

2020

2019

$

$

Own-Source Revenue

Note 1.2A: Revenue from Contracts with Customers

Revenue - proceeds of crime and memoranda of understanding

1,401,008

1,298,702

Research contract income

302,842

326,673

Conference income

3,881

282,212

Other income and contributions

89,720

225,969

Total revenue from Contracts with Customers

1,797,451

2,133,556

Accounting Policy

Revenue from Contracts with Customers

Revenue from contracts with customers is recognised when the customer obtains control of the services provided. For research projects this is by reference to the stage of completion of services 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 AIC.

The stage of completion of services at the reporting date is determined by reference to the proportion that costs incurred to date bear 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 end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

2020

2019

$

$

Note 1.2B: Other Revenue

Resources received free of charge - audit services

39,000

39,000

Inter-library loans and other miscellaneous revenue

2,501

2,549

Total other revenue

41,501

41,549

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 measured and the services or transferred assets would have been purchased if they had not been provided free of charge. Use of those resources is recognised as appropriate as an expense.

2020

2019

$

$

Note 1.2C: Revenue from Government

Appropriations

Departmental appropriations

4,595,000

4,590,000

Total revenue from Government

4,595,000

4,590,000

Accounting Policy

Revenue from Government

Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the AIC 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.

Note 2.1: Financial assets

2020

2019

Notes

$

$

Note 2.1A: Cash and cash equivalents

Special account cash held in Official Public Account

2.4

2,607,707

1,690,664

Cash at bank and on hand

564,348

192,020

Total Cash and cash equivalents

3,172,055

1,882,684

Note 2.1B: Trade and other receivables

Debtors

5.1

-

370,382

Accrued Revenue

5.1

19,988

-

Appropriation Receivable

3.1B

19,235

110,711

GST receivable

5.1

29,499

48,801

Total trade and other receivables

68,722

529,894

Accounting Policy

Trade and Other Receivables

Trade receivables and other receivables are held for the purpose of collecting the contractual cash flows. They are subsequently measured at amortised cost using the effective interest method, adjusted for any loss allowance.

Note 2.2: Non-financial assets

Note 2.2A: Reconciliation of the Opening and Closing Balances of Non-Financial Assets

Furniture and office equipment

Library collection

Intangibles

Total

$

$

$

$

As at 1 July 2019

Gross book value

107,582

771,127

70,450

949,159

Accumulated depreciation, amortisation and impairment

(11,962)

(15,336)

(70,450)

(97,748)

Total as at 1 July 2019

95,620

755,791

-

851,411

Additions

Purchase

-

6,310

-

6,310

Depreciation/amortisation

(23,377)

(15,520)

-

(38,898)

Total as at 30 June 2020

72,242

746,581

-

818,823

Total as at 30 June 2020 represented by

Gross book value

104,882

777,437

-

882,319

Accumulated depreciation, amortisation and impairment

(32,640)

(30,856)

-

(63,496)

Total as at 30 June 2020

72,242

746,581

-

818,823

Revaluations of non-financial assets

All revaluations were conducted in accordance with the revaluation policy stated in note 2.2A. The last full valuation was carried out in June 2018.

Accounting Policy

Asset Recognition

Furniture and office equipment costing greater than $5,000, intangible assets purchased externally costing greater than $5,000 and intangible assets purchased and modified or developed internally costing greater than $20,000 are capitalised. All Library items are accumulated as a single asset on a financial year basis and recognised irrespective of the value. Items costing less than these thresholds are expensed in the year of acquisition.

Revaluations

Following initial recognition at cost, furniture and office equipment and library are carried at fair value. Carrying values of the assets are reviewed every third year to determine if an independent valuation is required. The regularity of independent valuations depends on the volatility of movements in the 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 is 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 reverse a previous revaluation increment for that class. Upon revaluation, any accumulated depreciation is eliminated against the gross carrying amount of the asset.

Depreciation

Depreciable furniture and office equipment assets are written-off to their estimated residual values over their estimated useful life using the straight-line method of depreciation. Leasehold improvements are depreciated over the life of the lease term. 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 expected useful lives, unless an individual asset is assessed as having a different useful life.

2020

2019

Furniture and Office Equipment

3-10 years

3-10 years

Intangibles - Software purchased

3-5 years

3-5 years

Library

50 years

50 years

Intangibles

Intangibles assets comprise internally developed software and externally purchased software. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.

Software licences with the renewable term ending beyond 30 June 2020 are treated as prepayments at the time of purchase and expensed over the term of the prepayment.

Impairment

All assets were assessed for impairment at 30 June 2020. 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.

Derecognition

An item of furniture and office equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

Significant Accounting Judgements and Estimates

In the process of applying the accounting policies listed in this note, the AIC has made assumptions or estimates in measuring the fair value of the assets that have the most significant impact on the amounts recorded in the financial statements. The fair value of the AIC’s furniture and office equipment and library has been taken to be the market value or current replacement costs as determined by an independent valuer.

Note 2.3: Payables

2020

2019

$

$

Note 2.3A: Suppliers

Trade creditors and accruals

614,934

352,989

Total supplier payables

614,934

352,989

Note 2.3B: Other payables

Unearned income

1,414,728

948,182

GST payable

1,818

1,156

Other

-

36,432

Total other payables

1,416,546

985,771

Accounting Policy

Financial Liabilities

Supplier and other payables are classified as ‘other financial liabilities’ and are recognised at cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced). Supplier and other payables are derecognised on payment.

Note 2.4: Special accounts

Notes

2020

2019

$

$

Note 2.4: Criminology Research Special Account

Balance brought forward from previous period

1,882,684

936,856

Total increases

2,681,373

2,464,840

Available for payments

4,564,057

3,401,696

Total decreases

(1,392,002)

(1,519,012)

Total balance carried to the next period

3,172,055

1,882,684

Balance represented by:

Cash held in entity bank accounts

3.1B

564,348

192,020

Cash held in the Official Public Account

2,607,707

1,690,664

Total balance carried to the next period

3,172,055

1,882,684

Increases and decreases exclude the impacts of GST and 2019 figures have been adjusted to make them comparable in this regard.

Appropriation: Public Governance, Performance and Accountability Act 2013 section 80.

The Criminology Research Special Account is established under Section 46 of the Criminology Research Act 1971 as amended through the Financial Framework Legislative Amendment Act 2010 with effect from 1 July 2011.

Purpose: Conduct criminology research to promote justice, crime reduction and communicating results to Commonwealth, State & Territory, including administering programs to award grants, engage specialists for research and publication of that research.

Note 3.1: Appropriations

Note 3.1A: Annual Appropriation (‘Recoverable GST exclusive’)

Annual Appropriations for 2020

Annual Appropriation

Adjustments to appropriation

Total appropriation

Appropriation applied in 2020 (current and prior years)

Variance

$

$

$

$

$

Departmental

Ordinary annual services1

4,595,000

-

4,595,000

(4,705,711)

(110,711)

Capital budget2

22,000

-

22,000

(2,765)

19,235

Total departmental

4,617,000

-

4,617,000

(4,708,476)

(91,476)

Annual Appropriations for 2019

Annual Appropriation

Adjustments to appropriation

Total appropriation

Appropriation applied in 2019 (current and prior years)

Variance

$

$

$

$

$

Departmental

Ordinary annual services

4,590,000

-

4,590,000

(4,590,000)

-

Capital Budget3

22,000

-

22,000

(40,000)

(18,000)

Total departmental

4,612,000

-

4,612,000

(4,630,000)

(18,000)

Departmental Capital Budgets are appropriated through the Appropriation Act (No. 1). They form part of ordinary annual services, and are not separately identified in the Appropriation Act.

1 Variance in ordinary annual appropriation represents fully drawn 2018-19 GST refund held in OPA at 30 June 2019 and spent in the 2020 financial year.

2 Variance in capital budget represents unspent balance of current year budget held in OPA.

3 The undrawn and unspent capital appropriation ($18,000) from 2017-18 was carried forward and was drawn down and fully spent in 2018-19.

Unspent Annual Appropriations (‘Recoverable GST excusive’)

The AIC has no undrawn and unspent ordinary annual services appropriation as at 30 June 2020 (2018-19: nil).

The AIC has no undrawn capital budget appropriation as at 30 June 2020, and $19,235 of this appropriation remained unspent at 30 June 2020. In 2018-19 the AIC drew $18,000 Capital Budgets not drawn as at 30 June 2018.

Notes

2020

2019

$

$

Note 3.1B: Unspent Annual Appropriations ('Recoverable GST exclusive')

Departmental

Appropriation Act (No.1) 2018-19 – held in the OPA1

2.1A

-

110,711

Appropriation Act (No.1) 2019-20 – held in the OPA2

19,235

-

Appropriation Act (No.1) 2019-20 – cash held at bank1

2.4

564,348

192,020

Total departmental

564,348

302,731

1. The Appropriation Act (No.1) balance for 2018-19 represents unused appropriation for the year.

2. The Appropriation Act (No.1) balance for 2019-20 represents capital budget accrued for the year to be drawn down in 2020-21

Note 4.1: Key management personnel remuneration

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity. The AIC has determined the key management personnel positions to be the Director and the Deputy Director1. However the Director is also the full-time CEO of the Australian Criminal Intelligence Commission (ACIC) and his remuneration is reported against the ACIC, hence only one KMP position, the Deputy Director, is reported in the remuneration table below.

The key management personnel remuneration table excludes the remuneration and other benefits of the Minister. The Minister's remuneration and other benefits are set by the Remuneration Tribunal and are not paid by the AIC.

2020

2019

$

$

Note 4.1: Key Management Personnel Remuneration

Short-term employee benefits

223,378

191,594

Post-employment benefits

32,265

29,406

Other long-term employee benefits

5,225

4,824

Total key management personnel remuneration expenses1

260,868

225,824

Total number of key management personnel1

1

1

1. Includes officers substantively holding or acting for a period exceeding three months in the Deputy Director role.

Note 4.2: Related party disclosure

Related party relationships:

The AIC is an Australian Government controlled entity. Related parties of the AIC comprise the Ministers responsible for the AIC, other Cabinet Ministers, other Australian Government entities, the key management personnel of the AIC, and parties related to the AIC's key management personnel (including close family members and entities controlled by themselves, their close family members or jointly with close family members).

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. These transactions have not been separately disclosed in this note.

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 requiring disclosure.

Note 5.1: Financial instruments

Notes

2020

$

2019

$

Note 5.1A: Categories of Financial Instruments

Financial Assets measured at amortised cost

Cash and cash equivalents

3,172,055

1,882,684

Trade and other receivables

2.1A

19,988

370,382

Total financial assets

3,192,043

2,253,066

Financial Liabilities

Financial liabilities measured at amortised cost

Trade creditors and accruals

2.3A

614,934

352,989

Total financial liabilities

614,934

352,989

Note 6.1: Aggregate assets and liabilities

2020

2019

$’000

$’000

Note 6.1: Aggregate Assets and Liabilities

Assets expected to be recovered in:

No more than 12 months

3,311,115

2,490,729

More than 12 months

818,823

851,411

Total Assets

4,129,938

3,342,140

Assets expected to be settled in:

No more than 12 months

2,031,480

1,338,759

More than 12 months

-

-

Total Liabilities

2,031,480

1,338,759

Note 7: Budgetary variance reporting

The following are explanations of events that have impacted on the AIC's operations and activities for the year. Budget numbers are sourced from the AIC's Portfolio Budget Statements for 2019-20 and are provided in the primary statements. Budgeted numbers are not audited.

Major variances are those deemed relevant or most significant to an analysis of the AIC's performance by management, not focused merely on numerical differences between the actual and budgeted amounts.

Explanation for major variances

Affected line items
(and statement)

Proceeds of Crime Account Research

The AIC had continued funding from the Proceeds of Crime Account (PoCA) for research. This funding has had a significant effect on the AIC's financial statements. Providing a significant revenue stream ($1.4m), influencing some supplier expenses, consultants and contractors in particular, and substantially increasing cash at bank, offset by unearned revenue in other payables and creditors. The focus on PoCA funded projects also reduced revenue from other external sources and also resulted in a reduction in Debtors.

Expenses: Supplier expenses (Statement of Comprehensive Income)

Own Source Revenue: Contracts with customers (Statement of Comprehensive Income)

Financial Assets: Cash and cash equivalents (Statement of Financial Position)

Financial Liabilities: Supplier payables, Unearned revenue (Statement of Financial Position)

COVID-19

The AIC had reduced expenditure in supplier expenses compared to the previous year due to COVID-19. Primarily all conference activity was cancelled, training and travel were also curtailed through the last four months of the year. In comparison to the budget however supplier expenses are higher than budgeted mainly because the budget anticipated that all staff positions would be filled, however since these position were not filled this work had to be covered by contractors and consultants.

Expenses: Supplier expenses (Statement of Comprehensive Income)