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CSC financial statements

CSC Independent Auditor's Report

INDEPENDENT AUDITOR’S REPORT

To the Minister for Finance

Opinion

In my opinion, the financial statements of the Commonwealth Superannuation Corporation for the year ended 30 June 2020 present fairly, in all material respects, the financial position of the Commonwealth Superannuation Corporation as at 30 June 2020 and its financial performance and cash flows for the year then ended in accordance with Australian Accounting Standards and the Public Governance, Performance and Accountability (Financial Reporting) Rule 2015.

The financial statements of the Commonwealth Superannuation Corporation, which I have audited, comprise the following as at 30 June 2020 and for the year then ended:

  • Statement by the Chair, Chief Executive Officer and Chief Operating 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 Commonwealth Superannuation Corporation in accordance with the relevant ethical requirements for financial statement audits conducted by me. 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.

Directors’ responsibility for the financial statements

As the Accountable Authority of the Commonwealth Superannuation Corporation, the Directors are responsible under the Public Governance, Performance and Accountability Act 2013 (the Act) for the preparation and fair presentation of financial statements that comply with Australian Accounting Standards. The Directors are also responsible for such internal control as they determine is necessary to enable the preparation that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the Directors are responsible for assessing the ability of the Commonwealth Superannuation Corporation to continue as a going concern, disclosing, as applicable, matters related to going concern as applicable and using the going concern basis of accounting unless the Directors either intend to liquidate the entity or to cease operations, or have no realistic alternative but to do so.

Auditor’s responsibilities for the audit of the financial statements

My objective is to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of assurance but is not a guarantee that an audit conducted in accordance with the Australian National Audit Office Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements.

As part of an audit in accordance with the Australian National Audit Office Auditing Standards, I exercise professional judgement and maintain professional scepticism throughout the audit. I also:

  • 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 Directors;
  • conclude on the appropriateness of the Directors 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 those charged with governance 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

Grant Hehir

Auditor-General

Canberra

24 September 2020

Statement by the Chair, Chief Executive Officer, and Chief Operating 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 Commonwealth Superannuation Corporation will be able to pay its debts as and when they fall due.

The statement is made in accordance with a resolution of the directors.

Patricia Cross

Chair

23 September 2020

Damian Hill

Chief Executive Officer

23 September 2020

Andy Young

Chief Operating Officer

23 September 2020

CSC Statement of Comprehensive Income

Original

2020

2020

2019

Budget

Notes

$'000

$'000

$'000

Notes

NET CONTRIBUTION BY SERVICES

Expenses

Employee benefits

2.1

61,732

59,791

66,471

a

Suppliers

2.2

43,825

44,034

47,436

b

Depreciation and amortisation

5.1

9,552

6,184

6,044

c

Finance costs

2.3

573

80

12

c

Impairment loss on financial instruments

2.4

0

1

0

Write-down and impairment of assets

2.5

290

0

6

Total expenses

115,972

110,090

119,969

LESS:

Own-source income

Own-source revenue

Revenue from contracts with customers

3.1

120,568

114,666

119,837

Interest

3.2

79

145

132

Total own-source revenue

120,647

114,811

119,969

Gains

Other gains

0

459

0

Total gains

0

459

0

Total own-source income

120,647

115,270

119,969

Net contribution by services

4,675

5,180

0

Surplus for the year

4,675

5,180

0

OTHER COMPREHENSIVE INCOME

Items not subject to subsequent reclassification to net contribution by services

Other comprehensive income

0

0

0

Total other comprehensive income

0

0

0

Total comprehensive income

4,675

5,180

0

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

Budget Variances Commentary

Statement of Comprehensive Income

a. Employee expenses were lower than budget due to lower average staffing levels.

b. Supplier expenses are lower than budget due to the decision to defer several projects and initiatives due to the COVID-19 pandemic. The budget also included rental expense which has been reclassified as described in note c.

c. Depreciation and amortisation and Finance costs are higher than budget mainly due to the transition to the new Accounting Standard AASB 16 Leases, effective 1 July 2019. The budget was required to be based on the previous Accounting Standard AASB 117 Leases. This has also impacted the budget comparison for Buildings and Lease liabilities in the Statement of Financial Position.

CSC Statement of Financial Position

Original

2020

2020

2019

Budget

Notes

$'000

$'000

$'000

Notes

ASSETS

Financial Assets

Cash and cash equivalents

4.1

52,806

54,126

46,996

a

Trade and other receivables

4.2

5,771

3,986

5,903

Total financial assets

58,577

58,112

52,899

Non-Financial Assets1

Buildings

5.1

17,162

0

0

b

Leasehold improvements

5.1

8,218

9,712

9,015

Property, plant and equipment

5.1

2,985

4,415

5,065

c

Intangibles

5.1

14,448

15,505

13,084

d

Other non-financial assets

5.2

5,096

4,708

4,116

Total non-financial assets

47,909

34,340

31,280

Total assets

106,486

92,452

84,179

LIABILITIES

Payables

Suppliers

6.1

4,229

12,051

10,677

e

Other payables

6.2

2,396

9,392

438

f

Total payables

6,625

21,443

11,115

Interest Bearing Liabilities

Leases

7.1

24,062

0

0

b

Total interest bearing liabilities

24,062

0

0

Provisions

Employee provisions

8.1

13,580

14,124

14,048

Other provisions

8.2

2,616

2,270

8,883

g

Total provisions

16,196

16,394

22,931

Total liabilities

46,883

37,837

34,046

Net assets

59,603

54,615

50,133

EQUITY

Contributed equity

35,475

35,475

35,475

Operational risk reserve

1,527

771

1,469

Asset revaluation reserve

478

478

478

Retained surplus

22,123

17,891

12,711

Total equity

59,603

54,615

50,133

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

1. Right-of-use assets (ROU) are included in the following line items - Buildings and Property, plant and equipment.

Budget Variances Commentary

Statement of Financial Position

a. Cash and cash equivalents are higher than budget due to changes in the timing of expenditure on internally funded projects.

b. Refer to Statement of Comprehensive Income note c.

c. Property plant & equipment is lower than budget due to the decision to defer the procurement of infrastructure assets as a result of the COVID-19 pandemic.

d. Intangibles are higher than budget due to upgrades to superannuation administration systems required to implement superannuation legislation changes.

e. Supplier payables are lower than budget due to the timing of invoices received at year-end.

f. Other payables are higher than budget mainly due to a change in project delivery scheduling and the subsequent recognition of revenue associated with externally funded projects.

g. Other provisions are lower than budget due to the surrender of the Belconnen Office lease.

CSC Statement of Changes in Equity

Original

2020

2020

2019

Budget

Notes

$'000

$'000

$'000

Notes

CONTRIBUTED EQUITY

Opening balance

Balance carried forward from previous period

35,475

35,475

35,475

Closing balance as at 30 June

35,475

35,475

35,475

RETAINED SURPLUS

Opening balance

Balance carried forward from previous period

17,891

12,711

12,711

Adjustment on initial application of AASB 15/AASB 1058

(62)

0

0

Adjustment on initial application of AASB 16

(381)

0

0

Adjusted opening balance

17,448

12,711

12,711

Comprehensive income

Surplus for the year

4,675

5,180

0

Total comprehensive income

4,675

5,180

0

Closing balance as at 30 June

22,123

17,891

12,711

ASSET REVALUATION RESERVE

Opening balance

Balance carried forward from previous period

478

478

478

Other comprehensive income

Closing balance as at 30 June

478

478

478

OPERATIONAL RISK RESERVE

Opening balance

Balance carried forward from previous period

771

500

771

Transfers to reserve

Transfers from Department of Defence

756

271

698

Closing balance as at 30 June

1,527

771

1,469

Total Equity as at 30 June

59,603

54,615

50,133

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

Accounting Policy

Operational Risk Reserve

The operational risk reserve (ORR) represents trustee capital held for the purposes of meeting the operational risk financial requirement of the ADF Superannuation Scheme. The purpose of the operational risk reserve (ORR) is to provide adequate financial resources to address losses that may arise from an operational risk event. The ORR is operated in accordance with an ORR policy. The level of the reserve is determined by the Trustee Directors and reviewed annually, based on an assessment of the risks faced by the ADF Superannuation Scheme. The assets underlying the trustee capital were funded by the Department of Defence and are held in a segregated bank account as Australian-dollar denominated cash.

CSC Cash Flow Statement

Original

2020

2020

2019

Budget

Notes

$'000

$'000

$'000

Notes

OPERATING ACTIVITIES

Cash received

Rendering of services

118,247

115,741

123,159

a

Interest

79

156

132

Net GST received

211

123

102

Total cash received

118,537

116,020

123,393

Cash used

Employee benefits

(61,788)

(58,413)

(66,062)

a

Suppliers

(51,740)

(52,219)

(55,031)

a

Interest payments on lease liabilities

(531)

0

0

Net GST paid

0

0

0

Total cash used

(114,059)

(110,632)

(121,093)

Net cash from operating activities

9

4,478

5,388

2,300

INVESTING ACTIVITIES

Cash used

Purchase of leasehold improvements

(7)

(57)

(800)

Purchase of property, plant and equipment

(225)

(759)

(3,007)

a

Purchase and internal development of intangibles

(2,328)

(1,257)

(200)

a

Total cash used

(2,560)

(2,073)

(4,007)

Net cash used by investing activities

(2,560)

(2,073)

(4,007)

FINANCING ACTIVITIES

Cash received

Transfers to operational risk reserve

756

271

698

Total cash received

756

271

698

Cash used

Principal payments of lease liabilities

(3,994)

0

0

a

Total cash used

(3,994)

0

0

Net cash from/(used by) financing activities

(3,238)

271

698

Net increase/(decrease) in cash held

(1,320)

3,586

(1,009)

Cash and cash equivalents at the beginning of the reporting period

54,126

50,540

48,005

Cash and cash equivalents at the end of the reporting period

4.1

52,806

54,126

46,996

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

Budget Variances Commentary

Cash Flow Statement

a. The explanations of major variances to the budget in the Cash Flow Statement are explained in the Statement of Financial Position and Statement of Comprehensive Income.

CSC Notes to the Financial Statements

CSC NOTE 1: Overview

Objectives of the Entity

Commonwealth Superannuation Corporation (CSC) (ABN 48 882 817 243) is a corporate Commonwealth entity under the Public Governance, Performance and Accountability Act 2013. The objective of CSC is to provide retirement and insurance benefits for scheme members and beneficiaries, including past, present and future employees of the Australian Government and other eligible employers and members of the Australian Defence Force, through investment and administration of their superannuation funds and schemes. CSC is a not-for-profit entity. The continued existence of CSC in its present form and with its present programs is dependent on Government policy.

CSC is the Trustee responsible for the Public Sector Superannuation Scheme ('PSS'), the Commonwealth Superannuation Scheme ('CSS'), the Public Sector Superannuation Accumulation Plan ('PSSap'), the Military Superannuation and Benefits Scheme ('MSBS'), Australian Defence Force Superannuation Scheme ('ADF Super'), Australian Defence Force Cover Scheme ('ADF Cover'), the Defence Force Retirement and Death Benefits Scheme ('DFRDB'), the Defence Forces Retirement Benefits Scheme ('DFRB'), the Defence Force (Superannuation) (Productivity Benefit) Scheme ('DFSPB'), the Papua New Guinea Scheme ('PNG') and the 1922 Scheme, collectively referred to as 'the Schemes'.

The Schemes invest solely through the ARIA Investments Trust ('the AIT') - a pooled superannuation trust under CSC's trusteeship - which facilitates access to a broad range of underlying securities across various asset classes on an efficient and cost-effective basis.

CSC's activities are partly funded through the scheme administration charges collected from employers participating in PSS and CSS, and from members of PSSap and ADF Super, and through negotiated administration charges collected from the Department of Defence. Additional funding may be provided by Government to meet specific administration requirements.

The Basis of Preparation

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 have been prepared in accordance with:

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

b) Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) 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 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 thousand dollars unless otherwise specified.

New Accounting Standards

Adoption of New Australian Accounting Standard Requirements

No accounting standard has been adopted earlier than the application date as stated in the standard.

The following new and revised standards were issued by the Australian Accounting Standards Board prior to the sign-off date, were applicable to the current reporting period and had a material effect on CSC's financial statements:

Standard/ Interpretation

Application date for CSC

Nature of impending change/s in accounting policy and likely impact on initial application

AASB 16 Leases

1/07/2019

AASB 16 Leases became effective on 1 July 2019. AASB 16 Leases replaces AASB 117 Leases, Interpretation 4 Determining whether an Arrangement contains a Lease, Interpretation 114 Operating Leases - Incentives and Interpretations 127 Evaluating the Substance of Transactions Involving the Legal Form of a Lease. AASB 16 provides a single lessee accounting model, requiring the recognition of assets and liabilities for all leases, together with options to exclude leases where the lease term is 12 months or less, or where the underlying asset is of low value. The details of the changes in accounting policies, transitional provisions and adjustments are disclosed below and in the relevant notes to the financial statements.

Application of AASB 16 Leases

CSC adopted AASB 16 using the modified retrospective approach, under which the cumulative effect of initial application is recognised in retained earnings at 1 July 2019. Accordingly, the comparative information presented for 2019 is not restated, that is, it is presented as previously reported under AASB 117 and related interpretations.

CSC elected to apply the practical expedient to not reassess whether a contract is, or contains a lease at the date of initial application. Contracts entered into before the transition date that were not identified as leases under AASB 117 were not reassessed. The definition of a lease under AASB 16 was applied only to contracts entered into or changed on or after 1 July 2019.

AASB 16 provides for certain optional practical expedients, including those related to the initial adoption of the Standard. CSC applied the following practical expedients when applying AASB 16 to leases previously classified as operating leases under AASB 117:

  • Apply a single discount rate to a portfolio of leases with reasonably similar characteristics;
  • Exclude initial direct costs from the measurement of right-of-use assets at the date of initial application for leases where the right-of-use asset was determined as if AASB 16 had been applied since the commencement date;
  • Reliance on previous assessments on whether leases are onerous as opposed to preparing an impairment review under AASB 136 Impairment of assets as at the date of initial application; and
  • Applied the exemption not to recognise right-of-use assets and liabilities for leases with less than 12 months of lease term remaining as of the date of initial application.

As a lessee, CSC previously classified leases as operating or finance leases based on its assessment of whether the lease transferred substantially all of the risks and rewards of ownership. Under AASB 16, CSC recognises right-of-use assets and lease liabilities for most leases. However, CSC has elected not to recognise right-of-use assets and lease liabilities for some leases of low value assets based on the value of the underlying asset when new or for short-term leases with a lease term of 12 months or less.

On adoption of AASB 16, CSC recognised right-of-use assets and lease liabilities in relation to leases of office space, data centre space and motor vehicles, which had previously been classified as operating leases.

The lease liabilities were measured at the present value of the remaining lease payments, discounted using CSC's incremental borrowing rate as at 1 July 2019. CSC's incremental borrowing rate is the rate at which a similar borrowing could be obtained from an independent creditor under comparable terms and conditions. The weighted-average rate applied was 2.0%.

The right-of-use assets were measured at an amount equal to the carrying value that would have resulted from AASB 16 being applied from the commencement date of the leases, subject to the practical expedients noted above.

Impact on transition

On transition to AASB 16, CSC recognised additional right-of-use assets and additional lease liabilities, recognising the difference in retained earnings. The impact on transition is summarised below:

1 July 2019

Increase in Asset

Right-of-use assets

20,439,772

Increase in Liability

Lease liabilities

28,041,343

Decrease in Liability

AASB 117 reversal of lease liabilities as at 30 June 2019

7,220,658

Decrease in Equity

Retained earnings

380,913

The following table reconciles the Departmental minimum lease commitments disclosed in CSC's 30 June 2019 annual financial statements to the amount of lease liabilities recognised on 1 July 2019:

1 July 2019

Minimum operating lease commitment at 30 June 2019

30,468,176

Less: short-term leases not recognised under AASB 16

(199,840)

Undiscounted lease payments

30,268,336

Less: effect of discounting using the incremental borrowing rate as at the date of initial application

(2,226,993)

Lease liabilities recognised at 1 July 2019

28,041,343

Standard/ Interpretation

Application date for the entity

Nature of impending change/s in accounting policy and likely impact on initial application

AASB 15 Revenue from Contracts with Customers / AASB 2016-8 Amendments to Australian Accounting

Standards – Australian Implementation Guidance for Not-for-Profit Entities and AASB 1058 Income of Not-For-Profit Entities

1/07/2019

AASB 15, AASB 2016-8 and AASB 1058 became effective 1 July 2019.

AASB 15 establishes a comprehensive framework for determining whether, how much and when revenue is recognised. It replaces existing revenue recognition guidance, including AASB 118 Revenue, AASB 111 Construction Contracts and Interpretation 13 Customer Loyalty Programmes. The core principle of AASB 15 is that an entity recognises revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.

AASB 1058 is relevant in circumstances where AASB 15 does not apply. AASB 1058 replaces most of the not-for-profit (NFP) provisions of AASB 1004 Contributions and applies to transactions where the consideration to acquire an asset is significantly less than fair value principally to enable the entity to further its objectives, and where volunteer services are received .

The details of the changes in accounting policies, transitional provisions and adjustments are disclosed below and in the relevant notes to the financial statements.

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

CSC adopted AASB 15 and AASB 1058 using the modified retrospective approach, under which the cumulative effect of initial application is recognised in retained earnings at 1 July 2019. Accordingly, the comparative information presented for 2019 is not restated, that is, it is presented as previously reported under the various applicable AASBs and related interpretations.

Under the new income recognition model CSC shall first determine whether an enforceable agreement exists and whether the promises to transfer services to the customer are ‘sufficiently specific’. If an enforceable agreement exists and the promises are ‘sufficiently specific’ (to a transaction or part of a transaction), CSC applies the general AASB 15 principles to determine the appropriate revenue recognition. If these criteria are not met, CSC shall consider whether AASB 1058 applies.

Set out below are the amounts by which each financial statement line item is affected as at and for the year ended 30 June 2020 as a result of the adoption of AASB 15 and AASB 1058. The first column shows amounts prepared under AASB 15 and AASB 1058 and the second column shows what the amounts would have been had AASB 15 and AASB 1058 not been adopted:

Impact on transition

Transitional disclosure

AASB 15 / AASB 1058

Previous AAS

Increase/decrease

$'000

$'000

$'000

Own-source revenue

Other revenue - Australian Government entities (related parties)

1,656

1,656

0

Total own-source revenue

1,656

1,656

0

Net contribution by services

1,656

1,656

0

Liabilities

Unearned Revenue

(1,401)

(1,339)

62

Total liabilities

(1,401)

(1,339)

62

Retained earnings

(255)

(317)

(62)

Future Australian Accounting Standard Requirements

All new or revised standards and interpretations, that were issued prior to the sign-off date and are applicable to future reporting periods, are not expected to have a material impact on CSC’s financial statements.

Taxation

Under its legislation, the Income Tax Act is applicable to CSC, however in the normal course of its activities CSC does not generate taxable income under that Act. CSC is liable for Goods and Services Tax (GST) and Fringe Benefits Tax (FBT).

Revenues, expenses, assets and liabilities 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.

Controlled entities

CSC is the parent and sole shareholder of ARIA Co Pty Ltd. ARIA Co Pty Ltd is the Trustee of the ARIA Alternative Assets Trust and the PSS/CSS Investments Trust. ARIA Co Pty Ltd is not consolidated into CSC’s financial statements as it is a shell company and is considered to be immaterial.

Reporting of Administered activities

The FRR requires disclosure where one entity has drawn against a Special Appropriation which is the responsibility of another entity.

Administered assets, liabilities, revenue and expenses are those items which are controlled by the Government and were managed or over sighted by CSC on its behalf including:

  • Superannuation benefit payments; and
  • Superannuation contributions.

In addition to CSC, the entities responsible for managing the appropriations, Department of Finance (Finance), Department of Defence (Defence) and Department of Foreign Affairs and Trade (DFAT) will make separate disclosures of the contributions and unfunded benefits paid under the 1922, CSS, PSS, PNG, DFRB, DFRDB, MSB and ADF Cover schemes.

1922, CSS and PSS schemes

Finance has responsibility to account for the Commonwealth’s activities in relation to the 1922, CSS and PSS schemes. Finance has responsibility for managing the legislation and has delegated third party access rights to the appropriations under the following Acts:

  • Superannuation Act 1922;
  • Superannuation Act 1976;
  • Superannuation Act 1990;
  • Same Sex Relationships (Equal Treatment in Commonwealth Laws - Superannuation) Act 2008;
  • Governance of Australian Government Superannuation Schemes Act 2011 - s35(3)(a); and
  • Governance of Australian Government Superannuation Schemes Act 2011 - s35(4).

In addition, CSC was delegated third party access rights by Finance for the funding of legal and incidental costs of superannuation claims, and Act of Grace payments. These were appropriated under Appropriation Act (No. 1) 2019-2020 and Appropriation Act (No. 2) 2019-2020.

The funded components of the CSS and PSS Schemes are reported in their respective financial statements.

DFRB, DFRDB, MSB and ADF Cover Schemes

Defence has responsibility for managing the legislation and has delegated third party access rights to the appropriations under the following Acts:

  • Defence Forces Retirement Benefits Act 1948 ;
  • Defence Force Retirement and Death Benefits Act 1973 ;
  • Military Superannuation Benefits Act 1991; and
  • Australian Defence Force Cover Act 2015.

The funded components of MSBS are reported in the MSBS financial statements. The DFRB, DFRDB and ADF Cover are unfunded Schemes.

PNG Scheme

DFAT delegated third party access rights to CSC in respect of Papua New Guinea Superannuation Schemes which are appropriated in Appropriation Act (No. 1) 2019-2020 . CSC managed the payment of Pensions under the scheme on behalf of DFAT.

Administered Cash Transfers to and from the Official Public Account

Revenue collected by CSC for use by the Government rather than CSC was Administered Revenue. Collections are transferred to the Official Public Account (OPA) maintained by Finance. Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriations on behalf of Government.

Events After the Reporting Period

On 4 September 2020 CSC signed a new lease agreement for the Sydney office for a period of three years with no further option to extend. There were no other events subsequent to balance date that have the potential to significantly affect the ongoing structure and financial activities of CSC.

CSC NOTE 2. EXPENSES

2.1: Employee Benefits

2020

2019

$'000

$'000

2.1: Employee Benefits

Wages and salaries

49,251

45,273

Superannuation

Defined contribution plans

5,148

4,697

Defined benefit plans

1,855

2,544

Leave and other entitlements

4,977

5,570

Separation and redundancies

501

1,707

Total employee benefits

61,732

59,791

2.2: Suppliers

2020

2019

$'000

$'000

2.2: Suppliers

Goods and services supplied or rendered

Consultants

10,260

9,339

Contractors

8,716

6,757

Information technology and communications

12,093

11,996

Insurance

887

799

Member communication

1,410

1,111

Property (other than rent)

1,616

1,740

Employee recruitment and support

1,580

1,566

Subscriptions and professional memberships

394

516

Training and development

816

989

Travel

1,150

1,751

Other goods and services

3,990

2,652

Total goods and services supplied or rendered

42,912

39,216

Goods supplied

1,241

1,022

Services rendered

41,671

38,194

Total goods and services supplied or rendered

42,912

39,216

Other supplier expenses

Operating lease rentals

Operating lease rentals

1

0

3,372

Short-term leases

2

358

0

Workers compensation expenses

555

1,446

Total other suppliers

913

4,818

Total suppliers

43,825

44,034

1. CSC has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

2. The Melbourne, Adelaide and Brisbane office leases are for fixed terms of twelve months, and are classified as short term leases. CSC has short-term lease commitments of $216,000 as at 30 June 2020.

The above lease disclosures should be read in conjunction with the accompanying notes 2.3, 5.1 and 7.1

Accounting Policy

Short-term leases and leases of low-value assets

CSC has elected not to recognise right-of-use assets and lease liabilities for short-term leases of assets that have a lease term of 12 months or less. CSC recognises the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

2.3: Finance Costs

2020

2019

$'000

$'000

2.3: Finance Costs

Interest on lease liabilites

1

531

0

Other interest payments

42

80

Total finance costs

573

80

1. CSC has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

The above lease disclosures should be read in conjunction with the accompanying notes 2.2, 5.1 and 7.1.

Accounting Policy

All borrowing costs are expensed as incurred.

2.4: Impairment Loss on Financial Instruments

2020

2019

$'000

$'000

Impairment on trade and other receivables

0

1

Total write-down and impairment of financial instruments

0

1

2.5: Write-Down and Impairment of Assets

2020

2019

$'000

$'000

2.5: Write-Down and Impairment of Assets

Impairment of intangible assets

290

0

Total write-down and impairment of assets

290

0

2.6: Remuneration of Auditors

Financial statement audit services were provided to CSC by the Australian National Audit Office (ANAO) through its contracted service provider Deloitte Touche Tohmatsu (Deloitte). Fees for the ANAO's services are as follows:

2020

2019

$'000

$'000

Financial statement audit services

106

92

Regulatory audit services required by legislation to be provided to the auditor

9

9

115

101

Audit fees are also payable to the ANAO by other entities under CSC’s trusteeship. For the 2019-20 financial year the total fees payable for these entities is $652,500 (2019: $626,500).

The following additional services were provided by Deloitte:

2020

2019

$'000

$'000

Internal controls audit - other assurance engagement required by legislation or contractual arrangements

115

116

Consulting Services

60

294

175

410

No other services were provided to CSC by the ANAO or Deloitte.

CSC NOTE 3: Own-Source Revenue and Gains

3.1: Revenue from Contracts with Customers

2020

2019

$'000

$'000

3.1: Revenue from Contracts with Customers

Scheme administration fees - Australian Government entities (related parties)

71,019

70,755

Services rendered to the ARIA Investments Trust

44,605

40,448

Other revenue - Australian Government entities (related parties)

1,656

2,078

Trustee Levies

3,288

1,385

Total revenue from contracts with customers

120,568

114,666

Accounting Policy

Revenue from Contracts with Customers/ Income of Not-For-Profit Entities

Scheme administration fees and trustee levies:

CSC receives scheme administration fees and trustee levies collected from Australian Government entities participating in PSS and CSS, from members of PSSap and ADF, and through negotiated administration charges collected from the Department of Defence. The members of these superannuation schemes receive and consume the benefits as CSC performs the services. CSC has recorded this revenue over time under AASB 15 as the services are performed and the performance obligation is met.

Services rendered to the ARIA Investments Trust:

CSC receives fees from the AIT to recover the cost of managing the investments of the schemes. This cost recovery is performed on the basis of Board approved budget arrangements regarding the management of fund expenses. CSC does not retain any of these investment management services and the AIT simultaneously receives and consumes the benefits as CSC performs the services. CSC will record this revenue over time under AASB 15 as CSC recovers the costs of managing the investments of the schemes.

Other revenue:

Other revenue includes project funding received from Australian Government entities in order to meet specific administration requirements. The project funding received is either accounted for under AASB 1058 or AASB 15, depending on whether the services are retained by CSC or are passed onto the customer. Each project for which specific funding has been received by CSC has been assessed as having an enforceable contract with specific promises and performance obligations. Where funding has been used to construct an asset, the revenue has been assessed under AASB 1058 as CSC retains the control and benefit of the asset built. Where funding has been received for purposes other than constructing an asset, the revenue has been assessed under AASB 15 as the service specified in the contract has been provided to the customer.

Receivables for 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

3.2: Interest

2020

2019

$'000

$'000

3.2: Interest

Deposits

79

145

Total interest

79

145

Accounting Policy

Interest revenue is recognised using the effective interest method.

CSC NOTE 4: Financial Assets

4.1: Cash and Cash Equivalents

2020

2019

$'000

$'000

4.1: Cash and Cash Equivalents

Cash in special account

40,077

35,091

Cash on deposit

12,729

19,035

Total cash and cash equivalents

52,806

54,126

Accounting Policy

Cash is recognised at its nominal amount. Cash and cash equivalents include:

a) demand deposits in bank accounts with an original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value; and

b) cash in special accounts.

4.2: Trade and Other Receivables

2020

2019

$'000

$'000

4.2: Trade and Other Receivables

Receivables for services

Services

5,698

3,631

Total receivables for services

5,698

3,631

Other receivables:

GST receivable

73

284

Reimbursements

0

71

Total other receivables

73

355

Total trade and other receivables (gross)

5,771

3,986

Less impairment loss allowance

0

0

Total trade and other receivables (net)

5,771

3,986

Trade and other receivables (net) expected to be recovered in:

No more than 12 months

5,771

3,986

Total trade and other receivables (net)

5,771

3,986

Credit terms for services were within 30 days (2019: 30 days).

Accounting Policy

Financial Assets

Trade receivables and other receivables that are held for the purpose of collecting the contractual cash flows, where the cash flows are solely payments of principal and interest that are not provided at below-market interest rates, are subsequently measured at amortised cost using the effective interest method adjusted for any loss allowance.

Reconciliation of the Impairment Loss Allowance

Movements in relation to 2020

Services

Total

$'000

$'000

As at 1 July 2019

0

0

Increase/(Decrease) recognised in net contribution by services

0

0

Amounts written off

0

0

Total as at 30 June 2020

0

0

Movements in relation to 2019

Services

Total

$'000

$'000

As at 1 July 2018

(10)

(10)

Amounts written off

10

10

Total as at 30 June 2019

0

0

Accounting Policy

AASB 9 impairment requirements for financial assets are based on a forward-looking expected credit loss (ECL) model. The model applies to financial assets measured at amortised cost, contract assets and debt instruments measured at fair value through other comprehensive income. Trade and other receivable assets at amortised cost are assessed for impairment at the end of each reporting period. The simplified approach has been adopted in measuring the impairment loss allowance at an amount equal to lifetime ECL.

CSC NOTE 5: Non-Financial Assets

5.1: Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment and Intangibles

5.1: Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment and Intangibles

Reconciliation of the opening and closing balances of property, plant and equipment and intangibles for 2020

Buildings (ROU Asset)

Leasehold Improvements

Property, Plant and Equipment

Intangibles - Computer Software1

Total

$’000

$’000

$’000

$’000

As at 1 July 2019

Gross book value

0

12,759

8,349

29,564

50,672

Accumulated depreciation, amortisation and impairment

0

(3,047)

(3,934)

(14,059)

(21,040)

Total as at 1 July 2019

0

9,712

4,415

15,505

29,632

Recognition of right of use asset on initial application of AASB 16

20,391

0

63

0

20,454

Adjusted total as at 1 July 2019

20,391

9,712

4,478

15,505

50,086

Additions

Purchased

0

7

225

911

1,143

Internally developed

0

0

0

1,426

1,426

Impairments recognised in net contribution by services

2

0

0

0

(290)

(290)

Depreciation and amortisation

(1,501)

(1,685)

(3,104)

(6,290)

Depreciation on right-of-use assets

(3,229)

0

(33)

0

(3,262)

Total as at 30 June 2020

17,162

8,218

2,985

14,448

42,813

Total as at 30 June 2020 represented by:

Gross book value

20,391

12,766

8,637

31,901

73,695

Accumulated depreciation, amortisation and impairment

(3,229)

(4,548)

(5,652)

(17,453)

(30,882)

Total as at 30 June 2020

17,162

8,218

2,985

14,448

42,813

Carrying amount of right-of-use assets

17,162

0

30

0

17,192

1 The carrying amount of computer software includes $0.285 million of purchased software and $14.163 million of internally generated software.

2 At 30 June 2020, an impairment loss of $0.290 million has been recognised for internally developed software

Revaluations of non-financial assets

All revaluations were conducted in accordance with the fair value measurement policy stated at Note 16.1. Independent valuers conducted the last fair value assessment of the carrying values of all leasehold improvements and property, plant and equipment assets, excluding right of use assets, as at 30 June 2017. During the 2019-20 financial year, there have been limited acquisitions and minimal change to the underlying asset base. As such, the written down value as at 30 June 2020 for these assets represents fair value.

Contractual commitments for the acquisition of property, plant, equipment and intangible assets

CSC has contractual commitments totalling $0.697 million (2019: $0.379 million) for the acquisition of property, plant and equipment and intangible assets.

Reconciliation of the opening and closing balances of property, plant and equipment for 2019

1

Leasehold Improvements

Property, Plant and Equipment

Intangibles - Computer Software2

Total

$’000

$’000

$’000

$’000

As at 1 July 2018

Gross book value

12,702

7,624

28,307

48,633

Accumulated depreciation, amortisation and impairment

(1,378)

(2,253)

(11,225)

(14,856)

Total as at 1 July 2018

11,324

5,371

17,082

33,777

Additions

Purchased

57

725

0

782

Internally developed

0

0

1,257

1,257

Depreciation and amortisation

(1,669)

(1,681)

(2,834)

(6,184)

Total as at 30 June 2019

9,712

4,415

15,505

29,632

Total as at 30 June 2019 represented by:

Gross book value

12,759

8,349

29,564

50,672

Accumulated depreciation, amortisation and impairment

(3,047)

(3,934)

(14,059)

(21,040)

Total as at 30 June 2019 represented by

9,712

4,415

15,505

29,632

1. CSC has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

2. The carrying amount of computer software includes $0.004 million of purchased software and $15.501 million of internally generated software.

Accounting Policy

Accounting Policy

Assets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate.

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor’s accounts immediately prior to the restructuring.

Asset Recognition Threshold

Purchases of property, plant and equipment are recognised initially at cost in the statement of financial position, except for purchases costing less than $4,000 (2019: $4,000), which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make good’ provisions in Canberra and Sydney lease where there exists an obligation to the lessor. These costs are included in the value of CSC's leasehold improvements with a corresponding provision for the ‘make good’ recognised.

Lease Right of Use (ROU) Assets

Leased ROU assets are capitalised at the commencement date of the lease and comprise of the initial lease liability amount, initial direct costs incurred when entering into the lease less any lease incentives received. These assets are accounted for by CSC as separate asset classes to corresponding assets owned outright, but included in the same column as where the corresponding underlying assets would be presented if they were owned.

On initial adoption of AASB 16, CSC has adjusted the ROU assets at the date of initial application by the amount of any provision for onerous leases recognised immediately before the date of initial application. Following initial application, an impairment review is undertaken for any right of use lease asset that shows indicators of impairment and an impairment loss is recognised against any right of use lease asset that is impaired. Lease ROU assets continue to be measured at cost after initial recognition in Commonwealth agency, General Government Sector and Whole of Government financial statements.

Revaluations

Following initial recognition at cost, property, plant and equipment and leasehold improvements (excluding ROU assets) are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations 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 reverses a previous revaluation decrement of the same asset class that was 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.

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.

Depreciation

Depreciable property, plant and equipment assets are written off to their estimated residual values over their estimated useful lives to CSC using, in all cases, the straight-line method of depreciation.

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 useful lives:

2020

2019

Leasehold Improvements

Lease term

Lease term

Plant and equipment

3 to 10 years

3 to 10 years

The depreciation rates for ROU assets are based on the commencement date to the earlier of the end of the useful life of the ROU asset or the end of the lease term.

Impairment

All assets were assessed for indicators of 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.

The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the entity were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

Derecognition

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

Intangibles

CSC's intangibles comprise internally developed software and purchased software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.

Software is amortised on a straight-line basis over its anticipated useful life. The useful lives of CSC's software are 3 to 10 years (2019: 1 to 10 years).

Purchased or internally developed intangibles are recognised initially at cost in the Statement of Financial Position, except for purchased intangibles costing less than $80,000 (2019: $80,000) or internally developed assets costing less than $80,000 (2019: $80,000). These items are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

Software assets under development but not yet available for use have been tested for impairment

Accounting Judgements and Estimates

CSC has also made judgements in relation to the carrying value of internally generated software. The carrying amount is based on the recoverability as assessed by management given the most recent information available, including an impairment assessment as at 30 June 2020.

5.2: Other Non-Financial Assets

2020

2019

$'000

$'000

5.2: Other Non-Financial Assets

Prepayments

5,096

4,708

Total other non-financial assets

5,096

4,708

Other non-financial assets expected to be recovered in:

No more than 12 months

4,485

4,324

More than 12 months

611

384

Total other non-financial assets

5,096

4,708

No indicators of impairment were found for other non-financial assets (2019: Nil).

CSC NOTE 6: Payables

6.1: Suppliers

2020

2019

$'000

$'000

6.1: Suppliers

Trade creditors and accruals

4,229

12,051

Total suppliers

4,229

12,051

Supplier payables expected to be settled in:

No more than 12 months

4,229

12,051

Total suppliers

4,229

12,051

Settlement is usually made within 20 days (2019: 30 days).

6.2: Other Payables

2020

2019

$'000

$'000

6.2: Other Payables

Wages and salaries

931

427

Unearned revenue

1,401

1,664

Lease incentive

1

0

7,221

Other

64

80

Total other payables

2,396

9,392

1.

CSC has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

Other payables expected to be settled in:

No more than 12 months

1,625

3,074

More than 12 months

771

6,318

Total other payables

2,396

9,392

CSC NOTE 7: Interest Bearing Liabilities

7.1 Leases

2020

2019

$'000

$'000

7.1 Leases

Lease liabilities

1

24,062

0

Total leases

24,062

0

1. CSC has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

Total cash outflow for leases for the year ended 30 June 2020 was $4,525,000.

2020

2019

$'000

$'000

Maturity analysis - contractual undiscounted cash flows

Within 1 year

4,049

4,742

Between 1 to 5 years

13,144

13,692

More than 5 years

8,738

12,034

Total leases

25,931

30,468

CSC in its capacity as lessee has leases for office accommodation in Canberra, Sydney and a data centre facility at Hume.

Lease payments are subject to annual increases of 3.5% in the Canberra office, 4% fixed annual rate increases in the Hume data centre and 4% fixed rate annual increases in the Sydney office. These lease agreements are non-cancellable in the normal course of business.

The Canberra office lease has a further renewal option for 3 years and under the lease agreement CSC has a one off right to surrender any one of its floors at any time on or after 1 January 2022. The Sydney office and Hume data centre leases have no further option for renewal.

The above lease disclosures should be read in conjunction with the accompanying notes 2.2, 2.3, 5.1 and 7.1 Refer Note 1 for the accounting policy for leases.

CSC NOTE 8: Provisions

8.1: Employee Provisions

2020

2019

$'000

$'000

8.1: Employee Provisions

Leave

13,424

13,130

Separations and redundancies

156

994

Total employee provisions

13,580

14,124

Employee provisions expected to be settled in:

No more than 12 months

5,419

5,597

More than 12 months

8,161

8,527

Total employee provisions

13,580

14,124

Accounting Policy

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

Leave

The liability for employee benefits includes provision for annual leave and long service leave. The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.

The liability for long service leave has been determined by reference to the Australian Government short hand method. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and Redundancy

CSC recognises a provision for separation and redundancy benefit payments when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.

Superannuation

Staff are 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 CSS and PSS are defined benefit schemes for Australian Government employees. 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.

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

8.2: Other Provisions

2020

2019

$'000

$'000

8.2: Other Provisions

Provision for restoration obligations

2,616

2,254

Provision for superannuation lump sum payments

0

16

Total other provisions

2,616

2,270

Provision for restoration obligations

Provision for superannuation lump sum payments

Total other provisions

$’000

$’000

$’000

As at 1 July 2019

2,254

16

2,270

Provisions remeasured

320

0

320

Amounts reversed

0

(16)

(16)

Unwinding of discount or change in discount rate

42

0

42

Total as at 30 June 2020

2,616

0

2,616

2020

2019

$'000

$'000

8.2 Other Provisions (Continued)

Other provisions are expected to be settled in:

No more than 12 months

247

16

More than 12 months

2,369

2,254

Total other provisions

2,616

2,270

CSC currently has 2 (2019: 2) agreements for the leasing of premises which have provisions requiring CSC to restore the premises to their original condition at the conclusion of the lease. CSC has made a provision to reflect the present value of these obligations.

CSC NOTE 9: Cash Flow Reconciliation

2020

2019

$'000

$'000

Reconciliation of cash and cash equivalents as per Statement of Financial Position to Cash Flow Statement

Cash and cash equivalents as per:

Cash Flow Statement

52,806

54,126

Statement of Financial Position

52,806

54,126

Difference

0

0

Reconciliation of net contribution by services to net cash from/(used by) operating activities

Net contribution by services

4,675

5,180

Adjustments for non-cash items

Depreciation and amortisation

9,552

6,184

Write down and impairment of assets

290

1

Other gains

0

459

Movements in assets and liabilities

Assets

(Increase) / decrease in trade and other receivables

(1,785)

2,130

(Increase) / decrease in other non-financial assets

(388)

(595)

Liabilities

Increase / (decrease) in supplier payables

(7,831)

5,222

Increase / (decrease) in other payables

163

(1,607)

Increase / (decrease) in employee provisions

(544)

1,309

Increase / (decrease) in other provisions

346

(12,895)

Net cash from operating activities

4,478

5,388

CSC NOTE 10: Appropriations

10.1: Special Appropriations

10.1: Special Appropriations1

Authority

Appropriation applied

2020

2019

Type

Purpose

$'000

$'000

Superannuation Act 1922, Administered

Unlimited Amount

An Act to provide superannuation benefits for persons employed by the Commonwealth and by certain Commonwealth Authorities and to make provision for the families of those persons.

(60,570)

(67,060)

Superannuation Act 1976, Administered

Unlimited Amount

An Act to make provision for and in relation to an occupational superannuation scheme, known as the Commonwealth Superannuation Scheme, for persons employed by the Commonwealth and for certain other persons.

(4,487,942)

(4,465,504)

Superannuation Act 1990, Administered

Unlimited Amount

An Act to make provision for and in relation to an occupational superannuation scheme for persons employed by the Commonwealth, and for certain other persons.

(2,565,500)

(2,398,715)

Same Sex Relationships (Equal Treatment in Commonwealth Laws - Superannuation) Act 2008, Administered

Unlimited Amount

An Act to address discrimination against same‑sex couples and their children in Commonwealth laws, and for other purposes.

(63)

(62)

Governance of Australian Government Superannuation Schemes Act 2011 - s35(3)(a) in the case of the 1922 Scheme, DFRB, DFRDB, DFSPB or PNG schemes

Unlimited Amount

An Act to make provision for any money becoming payable by CSC in respect of an action, liability, claim or demand that relates to the 1922 Scheme, DFRB, DFRDB, DFSPB or PNG schemes.

0

0

Governance of Australian Government Superannuation Schemes Act 2011 - s35(4) to reimburse the superannuation funds administered by CSC

Unlimited Amount

An Act to make provision for any money becoming payable by Commonwealth Superannuation Corporation(CSC) in respect of an action, liability, claim or demand that relates to any other cases not covered in s35(3)(a) of Governance of Australian Government Superannuation Schemes Act 2011.

(298)

(138)

Defence Forces Retirement Benefits Act 1948, Administered

Unlimited Amount

An Act to provide Retirement Benefits for Members of the Defence Force of the Commonwealth, and for other purposes.

(38,375)

(40,648)

Defence Force Retirement & Death Benefits Act 1973, Administered

Unlimited Amount

An Act to make provision for and in relation to a Scheme for Retirement and Death Benefits for Members of the Defence Force.

(1,608,370)

(1,601,998)

Military Superannuation and Benefits Act 1991, Administered

Unlimited Amount

An Act to make provision for and in relation to an occupational superannuation scheme for, and the payment of other benefits to, members of the Defence Force, and for related purposes.

(1,112,392)

(911,698)

Public Governance, Performance and Accountability Act 2013 Section 77

Refund

Repayments required or permitted by law (where no other appropriation for repayment exists).

0

0

Australian Defence Force Cover Act 2015.

Unlimited Amount

An Act to provide a new statutory death and invalidity scheme.

(12,508)

(5,610)

Total

(9,886,018)

(9,491,433)

1. Amounts exclude recoverable GST.

10.2: Disclosure by Agent in Relation to Annual and Special Appropriations

10.2: Disclosure by Agent in Relation to Annual and Special Appropriations1

DFAT2

Department of Finance

Department of Defence

2020

$'000

$'000

$'000

Total receipts

33

3,337,300

1,498,429

Total payments

(4,525)

(7,115,621)

(2,771,645)

DFAT

Department of Finance

Department of Defence

2019

$'000

$'000

$'000

Total receipts

-

3,593,532

1,530,626

Total payments

(5,142)

(6,932,453)

(2,559,954)

1. Amounts exclude recoverable GST.

2. Department of Foreign Affairs and Trade.

10.3: Compliance with Statutory Conditions for Payments from the Consolidated Revenue Fund

Section 83 of the Constitution provides that no amount may be paid out of the Consolidated Revenue Fund except under an appropriation made by law.

CSC operates from the CSC Special Account established under the Public Governance, Performance and Accountability Act 2013 Section 80 in providing superannuation administration for Australian Government sponsored superannuation schemes. CSC, as an Agent, has third party access rights for the following Special Appropriations (refer note 10.1):

Department of Finance (Finance)

  1. Superannuation Act 1922;
  2. Superannuation Act 1976;
  3. Superannuation Act 1990;
  4. Superannuation Act 2005;
  5. Same-Sex Relationships (Equal Treatment in Commonwealth Laws - Superannuation) Act 2008;
  6. Governance of Australian Government Superannuation Schemes Act 2011;
  7. Annual Appropriation Act 1 (for Compensation & Legal payments and Act of Grace payments); and
  8. Annual Appropriation Act 2 (for Act of Grace payments).

Department of Defence (Defence)

  1. Defence Forces Retirement Benefits Act 1948;
  2. Defence Forces Retirement and Death Benefits Act 1973;
  3. Military Superannuation and Benefits Act 1991; and
  4. Australian Defence Force Cover Act 2015.

Department of Foreign Affairs and Trade (DFAT)

1. Annual Appropriation Act 1 (payments are made in accordance with the Papua New Guinea (Staffing Assistance) Act 1973 ).

10.3: Compliance with Statutory Conditions for Payments from the Consolidated Revenue Fund (Continued)

Both the Financial Framework Legislation Amendment Act (No.2) 2012 (FFLA Act No.2 (2012)) and the Financial Framework Legislation Amendment Act (No.1) 2013 (FFLA Act No.1 (2013)) require that CSC and the agency responsible for the special appropriation disclose, refer tables below, the number of recoverable overpayments made during the financial year and the balance recovered to 30 June. The following tables set out, as required by the FFLA Act No.2 and FFLA Act No.1, the number and amount of all payments made beyond legislative pre-conditions for the period 1 July 2019 to 30 June 2020:

Recoverable death payments2

Legislation / Authority to pay1

2020

2019

No.

Value $'000

Recovered $'000

No.

Value $'000

Recovered $'000

DFAT – Annual Administered Appropriation

Papua New Guinea (Staffing Assistance) Act 1973

13

13

8

10

38

13

Defence - Special Appropriations

Defence Forces Retirement Benefits Act 1948; and Defence Forces Retirement and Death Benefits Act 1973

693

1,301

808

659

857

695

Military Superannuation and Benefits Act 1973

34

61

50

37

42

24

Australian Defence Force Cover Act 2015

0

0

0

0

0

0

Finance - Special Appropriations

Superannuation Act 1922; and Superannuation Act 1976

1,963

3,619

2,843

2,459

3,916

3,154

Superannuation Act 1990

181

321

252

184

304

222

Recoverable payments3

No.

Value $'000

Recovered $'000

No.

Value $'000

Recovered $'000

DFAT – Annual Administered Appropriation

Papua New Guinea (Staffing Assistance) Act 1973

0

0

0

0

0

0

Defence - Special Appropriations

Defence Forces Retirement Benefits Act 1948; and Defence Forces Retirement and Death Benefits Act 1973

28

522

463

28

129

70

Military Superannuation and Benefits Act 1973

45

234

84

37

213

18

Australian Defence Force Cover Act 2015

0

0

0

0

0

0

Finance - Special Appropriations

Superannuation Act 1922; and Superannuation Act 1976

32

72

67

19

243

49

Superannuation Act 1990

130

657

237

37

292

72

1. Legislation

Amounts paid under each Act are disclosed in Note 10.1 Special Appropriations and Note 11 Special Accounts.

2. Recoverable death payments

Legislative changes made in the FFLA Act No.2 and FFLA Act No.1 provides a mechanism, called a ‘recoverable death payment’ that provides authority for the inadvertent overpayments of some benefits, and for their recovery in line with the duty to pursue recovery of a debt under rule 11 of the Public Governance, Performance and Accountability Rule 2015 .

3. Recoverable payments

Legislative changes made in the FFLA Act No.2 and FFLA Act No.1 provides a mechanism, called a ‘recoverable payment’, to address administrative issues common to CSC, that provides authority for the inadvertent overpayments of some benefits, and for their recovery in line with the duty to pursue recovery of a debt under rule 11 of the Public Governance, Performance and Accountability Rule 2015.

CSC NOTE 11: Special Accounts

CSC Special Account (Departmental)

1

Services for Other Entities and Trust Moneys

2

2020

2019

2020

2019

$'000

$'000

$'000

$'000

Balance brought forward from previous period

44,528

41,370

4,291

5,946

Increases

Other receipts

118,457

115,863

110,414

121,504

Total increases

118,457

115,863

110,414

121,504

Available for payments

162,985

157,233

114,705

127,450

Decreases

Departmental

Payments made to suppliers

(58,825)

(54,292)

0

0

Payments made to employees

(61,788)

(58,413)

0

0

Total departmental decrease

(120,613)

(112,705)

0

0

Special Public Money

Payments made to others

0

0

(110,111)

(123,159)

Total special public money decrease

0

0

(110,111)

(123,159)

Total decreases

(120,613)

(112,705)

(110,111)

(123,159)

Balance represented by:

Cash held in CSC bank accounts

2,295

9,437

0

0

Cash held in the Official Public Account

40,077

35,091

4,594

4,291

Total balance carried to the next period3

42,372

44,528

4,594

4,291

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

Establishing Instrument: Section 29E Governance of Australian Government Superannuation Schemes Legislation Amendment Act 2015

Purpose: For the receipt and expenditure of monies in connection with the provision of administration, accounting and other support services

2. Appropriation: Public Governance, Performance and Accountability Act 2013 section 78.

Establishing Instrument: Financial Management and Accountability Determination 2011/06

Purpose: For the receipt and expenditure of monies in connection with payments made on behalf of CSS, PSS, and MSBS, and for the receipt and expenditure of monies temporarily held on trust or otherwise for the benefit of a person other than the Commonwealth. The Trust monies represent returned benefits which have not yet been subsequently repaid to the member.

3. Amounts differ to Note 4.1 as the balances do not include cash on deposit held outside the Special Account.

CSC NOTE 12: Key Management Personnel Remuneration

Key management personnel are those persons having authority and responsibility for planning, directing and controlling the activities of CSC. Key management personnel remuneration is reported in the table below:

2020

2019

$

$

Short-term employee benefits

5,577,933

5,681,588

Post-employment benefits

421,596

512,265

Other long-term employee benefits

(30,065)

125,715

Termination benefits

0

261,086

Total key management personnel remuneration

5,969,464

6,580,654

Key management personnel comprise the Directors of CSC and those Executives of CSC that have authority and responsibility for planning, directing and controlling the activities of CSC.

The total number of key management personnel that are included in the above table are 22 individuals (2019: 26 individuals).

The Directors of CSC throughout the year ended 30 June 2020 and to date of this report were:

Ariane Barker

Patricia Cross (Chair)

Melissa Donnelly (Appointed 1 July 2020)

Christopher Ellison

Nadine Flood (Term ended 30 June 2020)

Winsome Hall (Term ended 30 June 2020)

Garry Hounsell

Sunil Kemppi (Resigned 22 November 2019)

Anthony Needham

Peggy O'Neal (Term ended 30 June 2020)

Margaret Staib

Michael Vertigan

Alistair Waters (Appointed 25 February 2020)

In addition to the Directors listed above, the following executives of CSC had authority and responsibility for planning, directing and controlling the activities of CSC throughout the year ended 30 June 2020:

Paul Abraham - Executive Manager, Investment Operations

Catharina Armitage - Head of People

Peter Carrigy-Ryan - Chief Executive Officer

Robert Firth - Chief Risk Officer (Previously Head of Risk until 2 December 2019)

Philip George - Special Advisor, Member Outcomes (Commenced 3 February 2020)

Peter Jamieson - Chief Customer Officer

Adam Nettheim - Head of Customer Operations (Previously Head of Scheme Operations until 4 November 2019)

Alana Scheiffers - General Counsel (Previosuly Head of Legal & Compliance until 6 September 2019)

Alison Tarditi - Chief Investment Officer

Andy Young - Chief Operating Officer

The following changes to the executives of CSC were made subsequent to 30 June 2020:

Peter Carrigy-Ryan - Chief Executive Officer (Retired 12 July 2020)

Philip George - Chief Transformation Officer (Previously Special Advisor, Member Outcomes until 31 July 2020)

Damian Hill - Chief Executive Officer (Commenced 13 July 2020)

Andrew Matuszczak - Executive Manager, Technology (Commenced 31 August 2020)

CSC NOTE 13: Related Parties Disclosure

Related Party Relationships:

Related parties to this entity are the Directors, the Executive, the Portfolio Minister 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 refunds of taxes, receipt of Medicare rebates or higher education loans. These transactions have not been disclosed in this note.

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

  • Commonwealth Superannuation Corporation transacts with other Australian Government controlled entities consistent with the normal day to day business operations under normal terms and conditions, including the payment of workers compensation insurance premiums (note 2.2), and the receipt of superannuation administration fees (note 3.1).
  • Refer to Note 8 Employee Provisions for details on superannuation arrangements with the Commonwealth Superannuation Scheme, the Public Sector Superannuation Scheme (PSS), and the Public Sector Superannuation Accumulation Plan (PSSap).

The following key management personnel are members of the schemes for which CSC is the Trustee:

Christopher Ellison (PSSap)

Nadine Flood (PSSap)

Winsome Hall (CSS & PSS)

Sunil Kemppi (PSSap)

Anthony Needham (MSBS & PSSap)

Margaret Staib (DFRDB & PSSap)

Alistair Waters (PSSap)

Paul Abraham (PSSap)

Catharina Armitage (PSSap)

Peter Carrigy-Ryan (CSS and PSSap)

Robert Firth (PSSap)

Philip George (PSSap)

Damian Hill (PSSap)

Peter Jamieson (PSSap)

Adam Nettheim (PSSap)

Alana Scheiffers (MSBS & PSSap)

Alison Tarditi (PSSap)

Andy Young (PSSap)

During the financial year, Margaret Staib was a member of the Council of the Australian Strategic Policy Institute, which made superannuation contributions to the PSS and PSSap schemes for which CSC is the Trustee. The contributions were made at arm’s length as part of a normal employer relationship on terms and conditions no more favourable than if the employer had not been a director-related entity.

CSC NOTE 14: Contingent Assets and Liabilities

Quantifiable Contingencies

CSC is not aware of any events that require it to report quantifiable contingencies (2019: Nil).

Unquantifiable Contingencies

CSC is not aware of any events that require it to report unquantifiable contingencies (2019: Nil).

Accounting Policy

Contingent liabilities and contingent assets are not recognised in the statement of financial position but are reported in the notes. They may arise from uncertainty as to the existence of a liability or asset or represent an asset or liability in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.

CSC NOTE 15: Financial Instruments

15.1: Categories of Financial Instruments

2020

2019

$'000

$'000

15.1: Categories of Financial Instruments

Financial assets measured at amortised cost

Cash and cash equivalents

52,806

54,126

Trade and other receivables

5,698

3,702

Total financial assets at amortised cost

58,504

57,828

Financial liabilities measured at amortised cost

Trade creditors and accruals

4,229

12,051

Other payables

995

507

Total financial liabilities measured at amortised cost

5,224

12,558

Accounting Policy

Financial Assets

Under AASB 9 Financial Instruments, CSC classifies its financial assets in the following categories:

a) financial assets at fair value through profit or loss;

b) financial assets at fair value through other comprehensive income; and

c) financial assets measured at amortised cost.

The classification depends on both the CSC's business model for managing the financial assets and contractual cash flow characteristics at the time of initial recognition. Financial assets are recognised when CSC becomes a party to the contract and, as a consequence, has a legal right to receive or a legal obligation to pay cash and derecognised when the contractual rights to the cash flows from the financial asset expire or are transferred upon trade date.

Financial Assets at Amortised Cost

Financial assets included in this category need to meet two criteria:

1. the financial asset is held in order to collect the contractual cash flows; and

2. the cash flows are solely payments of principal and interest (SPPI) on the principal outstanding amount.

Amortised cost is determined using the effective interest method.

Effective Interest Method

Income is recognised on an effective interest rate basis for financial assets that are recognised at amortised cost.

Financial Assets at Fair Value Through Other Comprehensive Income (FVOCI)

Financial assets measured at fair value through other comprehensive income are held with the objective of both collecting contractual cash flows and selling the financial assets and the cash flows meet the SPPI test.

Any gains or losses as a result of fair value measurement or the recognition of an impairment loss allowance is recognised in other comprehensive income.

Financial Assets at Fair Value Through Profit or Loss (FVTPL)

Financial assets are classified as financial assets at fair value through profit or loss where the financial assets either doesn't meet the criteria of financial assets held at amortised cost or at FVOCI (i.e. mandatorily held at FVTPL) or may be designated.

Financial assets at FVTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest earned on the financial asset.

Impairment of Financial Assets

Financial assets are assessed for impairment at the end of each reporting period based on Expected Credit Losses, using the general approach which measures the loss allowance based on an amount equal to lifetime expected credit losses where risk has significantly increased, or an amount equal to 12-month expected credit losses if risk has not increased.

The simplified approach for trade, contract and lease receivables is used. This approach always measures the loss allowance as the amount equal to the lifetime expected credit losses.

A write-off constitutes a derecognition event where the write off directly reduces the gross carrying amount of the financial asset.

Financial Liabilities

Financial liabilities are classified as either financial liabilities ‘at fair value through profit or loss’ or other financial liabilities. Financial liabilities are recognised and derecognised upon ‘trade date’.

Financial Liabilities at Fair Value Through Profit or Loss

Financial liabilities at fair value through profit or loss are initially measured at fair value. Subsequent fair value adjustments are recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability.

Financial Liabilities at Amortised Cost

Financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective interest basis.

Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

15.2: Net Gains or Losses on Financial Assets

2020

2019

$'000

$'000

15.2: Net Gains or Losses on Financial Assets

Financial assets at amortised cost

Interest revenue

79

145

Impairment loss on financial instruments

0

(1)

Net gains on financial assets at amortised cost

79

144

15.3: Net Gains or Losses on Financial Liabilities

There is no net interest expense from financial liabilities not at fair value through profit or loss (2019: Nil).

15.4: Fair Value of Financial Instruments

The carrying amount for all financial assets and liabilities is equal to their fair value in the years ending 30 June 2020 and 30 June 2019.

15.5: Credit Risk

CSC is exposed to minimal credit risk as loans and receivables are cash and trade receivables. The maximum exposure to credit risk is the risk that arises from potential default of a debtor. This amount is equal to the balance of trade receivables, interest receivable and reimbursements (excluding GST receivable) 2020: $5,698,000 (2019: $3,702,000).

Maximum Exposure to Credit Risk

2020

2019

Financial assets carried at amount not best representing maximum exposure to credit risk

$’000

$’000

Cash and cash equivalents

52,806

54,126

Receivables for services

5,698

3,631

Reimbursements

0

71

Total financial assets carried at amount not best representing maximum exposure to credit risk

58,504

57,828

CSC has assessed the risk of the default on payment and has an impairment loss allowance: Nil (2019: Nil). CSC has calculated its impairment loss allowance based on its historical observed default rates, adjusted for forward-looking estimates. As a result of the COVID-19 pandemic credit risk has increased during the reporting period, however, CSC is exposed to low levels of credit risk as majority of its debtors are the ARIA Investment Trust and Commonwealth agencies who have low risk of default. CSC manages credit risk by following up debtors before the due date to ensure payment. In addition, policies and procedures are in place that guide employee debt recovery techniques. CSC holds no collateral to mitigate against credit risk.

15.6: Liquidity Risk

CSC's financial liabilities are suppliers and other payables. The exposure to liquidity risk is based on the notion that CSC will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to funding received for specific projects and internal policies and procedures put in place to ensure there are appropriate resources to meet CSC's financial obligations.

Maturities for non-derivative financial liabilities 2020

On

within

1 to 2

2 to 5

> 5

demand

1 year

years

years

years

Total

$'000

$'000

$'000

$'000

$'000

$'000

Trade creditors and accruals

0

4,229

0

0

0

4,229

Other

0

995

0

0

0

995

Total

0

5,224

0

0

0

5,224

Maturities for non-derivative financial liabilities 2019

On

within

1 to 2

2 to 5

> 5

demand

1 year

years

years

years

Total

$'000

$'000

$'000

$'000

$'000

$'000

Trade creditors and accruals

0

12,051

0

0

0

12,051

Other

0

507

0

0

0

507

Total

0

12,558

0

0

0

12,558

During 2019-20 the majority of CSC's activities were funded through direct charges for scheme administration services and trustee services. CSC manages its budgeted funds to ensure it has adequate funds to meet payments as they fall due. In addition, CSC has procedures in place to ensure timely payments are made when due and has no past experience of default.

15.7: Market Risk

CSC holds basic financial instruments that do not materially expose CSC to market risks, including 'interest rate risk', 'currency risk' or 'other price risk'.

CSC NOTE 16: Fair Value Measurements

The following tables provide an analysis of assets and liabilities that are measured at fair value. The remaining assets and liabilities disclosed in the Statement of Financial Position do not apply the fair value hierarchy.

The different levels of the fair value hierarchy are defined below:

Level 1: Quoted prices (unadjusted) in active markets for identical assets and liabilities that CSC can access at measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset and liability, either directly or indirectly.

Level 3: Unobservable inputs for the asset or liability.

Accounting Policy

Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not differ materially from the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

An independent valuer conducted a fair value assessment of the carrying values of all leasehold improvements and property, plant and equipment at 30 June 2017

16.1: Fair Value Measurement

Fair value measurements at the end of the reporting period

Valuation Technique(s) and Inputs Used

2020

2019

Category
(Level 1, 2 or 3)3,4,5

Valuation Technique 1

Inputs used

Sensitivity Analysis

$’000

$’000

Non-financial assets2

Leasehold improvements

8,218

9,712

Level 3

Depreciated replacement cost

Replacement cost new


Consumed economic benefit/Obsolescence of asset


Significant movements in any of the inputs in isolation would result in a significantly different fair value measurement. A change in the assumption used for replacement cost is accompanied by a directionally similar change in the fair value of building, leasehold improvements and PP&E. A change in the assumption used for consumed economic benefit/obsolescence of asset is accompanied by a directionally opposite change in the fair value of building, leasehold improvements and PP&E.

Property, plant and equipment (PP&E)

6

2,955

4,415

Level 3

Depreciated replacement cost

Replacement cost new


Consumed economic benefit/Obsolescence of asset

Total non-financial assets

11,173

14,127

Total fair value measurements of assets in the Statement of Financial Position

11,173

14,127

1. There were no changes in valuation technique used from previous years.

2. CSC's assets are held for operational purposes and are not held for the purposes of deriving a profit. The current use of all-non financial assets is considered their highest and best use.

3. The remaining assets and liabilities reported by CSC are not measured at fair value in the Statement of Financial Position.

4. CSC did not measure any non-financial assets at fair value on a non-recurring basis as at 30 June 2020.

5. There have been no transfers between level 1 and level 2 of the hierarchy during the year.

6. Property, plant and equipment does not include right of use asset for motor vehicles.

Significant level 3 inputs utilised by CSC have been derived and evaluated as follows:

Consumed economic benefit/obsolescence of asset

Assets that do not transact with enough frequency or transparency to develop objective opinions of value from observable market evidence have been measured utilising the cost (depreciated replacement cost (DRC)) approach. Under the DRC approach the estimated cost to replace the asset is calculated and then adjusted to take into account its consumed economic benefit/asset obsolescence (accumulated depreciation). Consumed economic benefit/asset obsolescence has been determined based on professional judgement regarding physical, economic and external obsolescence factors relevant to the asset under consideration.

16.2: Reconciliation for Recurring Level 3 Fair Value Measurements

16.2: Reconciliation for Recurring Level 3 Fair Value Measurements

Leasehold Improvements

Property, Plant and Equipment3

Total

2020

2019

2020

2019

2020

2019

$’000

$’000

$’000

$’000

$’000

$’000

As at 1 July

9,712

11,324

4,415

5,371

14,127

16,695

Total gains/(losses) recognised in net contribution by service

2

(1,501)

(1,669)

(1,685)

(1,681)

(3,186)

(3,350)

Purchases

7

57

225

725

232

782

Total as at 30 June

8,218

9,712

2,955

4,415

11,173

14,127

1. CSC has applied AASB 16 using the modified retrospective approach and therefore the comparative information has not been restated and continues to be reported under AASB 117.

2. These gains/(losses) are presented in the Statement of Comprehensive income under depreciation and amortisation expense and write-down and impairment of assets. No assets were transferred into or out of level 3 during the year.

3. Property, plant and equipment does not include right of use asset for motor vehicles.

CSC NOTE 17: Aggregate Assets and Liabilites

2020

2019

$'000

$'000

Assets expected to be recovered in:

No more than 12 months

63,062

62,436

More than 12 months

43,424

30,016

Total Assets

106,486

92,452

Liabilities expected to be settled in:

No more than 12 months

15,080

20,738

More than 12 months

31,803

17,099

Total liabilities

46,883

37,837

CSC NOTE 18: Assets Held in Trust

Monetary assets

Shown below are the values of gross assets held in Trust by CSC in its capacity as Trustee of the CSS, PSS, PSSap, MSBS and ADF Super. The assets comprise units in the AIT, for which CSC is also Trustee, plus cash and cash equivalents and sundry debtors.

2020

2019

$'000

$'000

CSS

Opening balance

2,421,629

2,788,354

Closing balance

1,957,075

2,421,629

PSS

Opening balance

21,253,268

20,503,057

Closing balance

20,424,132

21,253,268

PSSap

Opening balance

14,690,228

12,687,338

Closing balance

15,556,947

14,690,228

MSBS

Opening balance

10,334,286

9,383,714

Closing balance

10,370,122

10,334,286

ADF Super

Opening balance

301,698

136,314

Closing balance

501,962

301,698

CSC NOTE 19: Reporting of Outcomes

Outcome 1

1

2020

2019

$’000

$’000

Expenses

Employees

61,732

59,791

Suppliers

43,825

44,034

Depreciation and amortisation

9,552

6,184

Finance costs

573

80

Impairment loss allowance on financial instruments

0

1

Write-down and impairment of assets

290

0

Total expenses

115,972

110,090

Own-source revenue

Revenue from contracts with customers

120,568

114,666

Interest

79

145

Gains

Other gains

0

459

Total own-source income

120,647

115,270

Assets

Cash and cash equivalents

52,806

54,126

Trade and other receivables

5,771

3,986

Buildings

17,162

0

Leasehold improvements

8,218

9,712

Property, plant and equipment

2,985

4,415

Intangibles

14,448

15,505

Other non-financial assets

5,096

4,708

Total assets

106,486

92,452

Liabilities

Supplier payables

4,229

12,051

Other payables

2,396

9,392

Leases

24,062

0

Employee provisions

13,580

14,124

Other provisions

2,616

2,270

Total liabilities

46,883

37,837

1. CSC has one outcome: Retirement and insurance benefits for scheme members and beneficiaries, including past, present and future employees of the Australian Government and other eligible employers and members of the Australian Defence Force, through investment and administration of their superannuation funds and schemes. Net costs shown included intra-government costs that were eliminated in calculating the actual Budget Outcome.