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Note 12. Explanations of major budget variances

The following tables provide explanations of variances between the original budget as presented in the 2019–20 Portfolio Budget Statements (PBS) and the 2019–20 final outcome as presented in accordance with Australian Accounting Standards for AITSL. The Budget is not audited.

Variances are considered to be major based on the following criteria:

  • the variance between the PBS and the final result is greater than 10% of the original budget for a line item, and
  • the variance between the PBS and the final result is greater than $300,000, or
  • the item is below the 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 the company's performance.

Explanation of major variances

Affected statement line items

Sales of services and expenses

AITSL was tasked with a number of additional projects through the year. To undertake the work AITSL was provided with further income of $3,729,000 from Federal and state and territory governments.

The majority of the additional work was completed during the year to 30 June 2020 and has required an increase in expenditure for both employees and programs.

Statement of Comprehensive Income

  • Sales of services
  • Employee benefits and programs expenses

Statement of Cash Flows

  • Sales of services
  • Employees
  • Suppliers

Supplier and other payables

The additional tasks undertaken by AITSL together with the unexpected impact of the COVID-19 virus caused some expenditure to be incurred later in the year than had been planned. This has resulted in an increase in the supplier and other payables at year end.

Statement of Financial Position

  • Supplier and other payables

Statement of Cash Flows

  • Suppliers
  • Net increase in cash held

Cash and financial assets

Interest rates offered on bank term deposits have reduced considerably throughout the 2019–20 year. AITSL has been able to earn higher interest from bank deposits and has moved its funds into the bank accounts as term deposits matured.

Statement of Financial Position

  • Cash and cash equivalents
  • Financial assets at amortised cost

Statement of Cash Flows Investing activities

  • Sale (Purchase) of financial assets

Property, furniture and equipment

AITSL has adopted the new accounting standard AASB 16 for the first time in the current year.
The detail of the new standard and its impact is explained in Note 3.2 to the Financial Statements.

Statement of Financial Position

  • Property, furniture, equipment
  • Lease liability

Statement of Comprehensive Income

  • Depreciation and amortisation
  • Administration expenses

Statement of Cash Flows
Financing activities

  • Repayment of lease liabilities