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Summary of financial performance

Departmental finances

Operating result

Our agency achieved an operating surplus of $0.411 million (before depreciation and amortisation) in 2018-19 (2017-18: $2.388 million) against a budgeted break even position.

Expenses

Operating expenditure for 2018-19 was $70.454 million excluding depreciation and amortisation.

Figure 13: Operating expenditure 2018-19Pie chart graph of the operating expenditure for 2018-19 - 57% of expenditure is on employees; 13% of expenditure is on information technology services; 10% on contractors; 6% operating expenses including rent; 4% on consultants; 3% audit and compliance; 4% other; 3% staff related expenses including insurances.

Refer to note 1.1 of the Financial statements.

Our agency incurred total employee expenses of $40.205 million in 2018–19, $1.117 million higher than the budget estimate reported in the Portfolio Budget Statements 2018–19 (PBS), and $1.441 million higher than the previous year ($38.764 million). The increase in employee expenses between years is mainly due to the bond rate adjustment to employee expenses and provision balances by $1.247 million at 30 June 2019 as average staffing levels remained largely consistent (315 in 2018–19, and 313 in 2017–18).

Supplier expenses in 2018-19 of $30.230 million remained on par with the previous year ($29.586 million) and did not exceed the PBS budget estimate of $31.176 million.

Revenue

The work of our agency is mainly funded by Government appropriation. Government revenue from departmental appropriations reduced slightly to $69.879 million from $69.969 million.

Own source revenue in 2018-19 was $0.986 million, an increase from 2017-18 due to the receipt of $0.190 million from another government agency under the Data Integration Partnership Initiative.

Refer to note 1.2 of the Financial statements.

Financial position and future financial viability

Our agency remains in a sound financial position, operating within our appropriation and with sufficient cash reserves to fund our debts as and when they fall due.

As at 30 June 2019, the agency had net equity of $13.812 million, represented by $31.220 million assets offset by $17.408 million of liabilities.

The majority of assets relate to appropriation and other receivables ($19.592 million) and intangibles ($5.821 million). The majority of liabilities relate to employee provisions ($11.099 million) and suppliers ($3.928 million).

Capital investment

Our capital expenditure budget for 2018-19 was $1.161 million.

We continue to invest in the development of our client systems to further improve the client experience, reducing client burden and improving efficiency for the agency.

Administered finances

Our agency administered the Emissions Reduction Fund, Renewable Energy Target and residual items relating to the carbon pricing mechanism on behalf of the Government in 2018–19.

Administered Income

Administered income was $240.317 million and came entirely from the administration of the Renewable Energy Target.

Figure 14: Administered income 2018-19Pie chart graph showing administered income for 2018-19 - 92% from administration of RET; 7% from registration of certificates; 1% from surrender of certificates.

Refer to the Administered Schedule of Comprehensive Income and Note 2.2 of the Financial statements.

Administered expenses

Administered expenses were $436.113 million predominantly due to the recognition of a provision for refund (large-scale shortfall) and the payment for contracts under the Emissions Reduction Fund.

Figure 15: Administered expenses 2018-19Pie chart showing administered expenses for 2018-19 - 63% due to recognition of a provision for refund (large scale shortfall); 36% for payment of contracts under ERF; 1% for RET inspections.

Refer to the Administered Schedule of Comprehensive Income and Note 2.1 of the Financial statements.

Agency resource statement

The agency resource statement provides additional information about the various funding sources that the agency may draw upon during the year. Appendix E: Entity resource statement and expenses by outcome details the resources available to the agency during 2018–19 and sets out the agency’s summary of total expenses for Outcome 1.