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Budget Variances Commentary

The explanations provide a comparison of the original budget as presented in the 2020-21 Portfolio Budget Statements (PBS) to the 2020-21 final outcome as presented in accordance with Australian Accounting Standards for the Australian Transport Safety Bureau (ATSB). The Budget is not audited.

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

- the variance between budget and actual is greater than 10%: and

- the variance between budget and actual is greater than 2% of total expenses or total own-source revenues: or

- the variance between budget and actual is below this 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 performance of the agency.

In some instances, a budget has not been provided for in the PBS, for example non-cash items such as asset revaluations and sale of assets adjustments. Unless the variance is considered to be ‘major’ no explanation has been provided.

Explanations of major variances

Affected line items (and statement)

Application of Australian Accounting Standards Board Standard 16 - Leases (AASB16)

With the application of AASB16 Leases, there was a large shift from supplier expenses to depreciation and interest within the Statement of Financial Position, in relation to the ATSB's office accommodation and vehicle leases.

Statement of Comprehensive Income

Expenses - Suppliers

Expenses - Depreciation and amortisation

Expenses - Finance costs

Statement of Financial Position

Non-financial assets - Buildings

Interest-bearing liabilities - Leases

Income

A decrease in funding received in relation to the ATSB's international projects occurred after the original budget was set.

Statement of Comprehensive Income

Own-source revenue - Revenue from contracts with customers

Other Revenue

An increase in other revenue is as a result of higher than projected investigation services completed during the financial year. The ATSB receives the services free of charge from the Chief Investigator Transport Safety, Victoria and the NSW Office of Transport Safety Investigations.

Statement of Comprehensive Income

Own-source revenue - Other revenue

Financial Assets

The budgeted estimate for cash and accrued revenue is made on a rolling three-year historical trend, which has resulted in an estimate being less than the 2020-21 actual.

Statement of Financial Position

Financial assets - Cash and cash equivalents

Financial assets - Accrued revenue

Non-Financial Assets

The ATSB experienced significant delays in implementing a major internally developed software projects during 2020-21. It is expected that the implementation of this project will occur early in 2021-22.

Statement of Financial Position

Non-financial assets - Computer software

Other Payables

The variance between the budget within the PBS and the actual outcome for the 2020-21 financial year, is mainly attributable to the unprojected employee cessation entitlements payable.

Statement of Financial Position

Payables - Other payables

Provisions

Employee provisions are higher than expected due to leave transferred in for new staff not budgeted for.

Statement of Financial Position

Provisions - Employee provisions

Statement of Changes in Equity

Total equity is greater than projected in the budget mainly due the differences between the actual and budgeted operating result, with the larger variance identified above.

Statement of Changes in Equity

Cash Flow Statement

Variances in the Cash Flow Statement are broadly consistent with the variances explained above for income and expenses.

Cash Flow Statement