3.1 - Employee Provisions

3.1A - Employee provisions

Annual leave

Long service leave

Total employee provisions

Employee provisions expected to be settled

No more than 12 months

More than 12 months

Total employee provisions

Accounting policy

Liabilities for short term employee benefits and termination benefits expected within twelve months of the end of the reporting period are measured at their nominal amounts.

Leave

ASPI has changed its policy for recognising long service leave (LSL) liability in 2019-20 by adopting the employee-by-employee analysis method; which is based on the organisation’s staffing policy and the historical tenure of staff to allocate a probability to each staff member. This has resulted in corporate staff including heads of department and staff who have joined with recognised prior service being recognised in the LSL liability calculation while the employees under short term contracts (Senior Analysts, Analysts, and Researchers) have been excluded unless they are expected to accrue long service leave. ASPI uses a discount factor reflecting long term salary growth rate and 10 year bond rate (in line with the Department of Finance standard parameters) and suitable probability weights to reflect the present value of the future obligation.

Superannuation

ASPI's staff are members of the Public Sector Superannuation Scheme, or the PSS accumulation plan (PSSap) or other superannuation funds held outside the Australian Government. The PSS is a defined benefit scheme 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.

ASPI 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. ASPI accounts for the contributions as if they were contributions to defined contribution plans.

3.2 - Directors and Key Management Personnel Remuneration

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of the entity, directly or indirectly. ASPI has determined the key management personnel to be its Council members and the Executive Director. Key management personnel remuneration is reported in the table below:

Short term employee benefits

Salary

Performance bonuses

Annual leave

Total short term employee benefits

Other long term employee benefits

Long Service Leave

Total other long term employee benefits

Post Employment Benefits

Superannuation

Total post employment benefits benefits

Total key management personnel remuneration

The total number of directors and key management personnel that are included in the above table are 13. (2019: 9)

12 of the 13 executives are part time Council members and the remaining member is the full time Executive Director of ASPI. Remuneration for both Council members and the Executive Director are subject to Remuneration Tribunal Determinations.

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

3.3 - Related Party Disclosures

Related party relationships

ASPI is a Commonwealth Government wholly owned not for profit company. Related parties to this entity are ASPI's Council members, the ASPI Executive Director 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.

The following transactions with related parties occurred during the financial year:

During the year, ASPI received sponsorship from the following company which an ASPI Council member is non-executive director:

Senetas Corporation Limited

Boeing Australia, NZ and South Pacific

Boeing Australia Holdings Ltd

Naval Group Australia

ASPI transacts with other Australian Government controlled entities and other Australian government entities consistent with normal day-to-day business operations provided under normal terms and conditions, including the payment of workers compensation and insurance premiums. Other than Department of Defence core funding of $4,000,000 received in FY2019-2020, these are not considered individually significant to warrant separate disclosure as related party transactions.

Refer to Note 3.1 Employee Provisions for details on superannuation arrangements with the Public Sector Superannuation Scheme (PSS) and the PSS accumulation plan (PSSap). A key management personnel was a Director of the Commonwealth Superannuation Corporation which is trustee to the PSS and PSSap superannuation schemes.