Objectives of IP Australia
IP Australia is an Australian Government controlled entity. It is a not-for-profit entity. The objective of IP Australia is to contribute to the improvement of Australian and international IP systems and thereby supporting Australia's economic development through the provision and administration of intellectual property rights.
IP Australia is structured to meet one outcome: increased innovation, investment and trade in Australia, and by Australians overseas, through the administration of the registrable intellectual property rights system, promoting public awareness and industry engagement, and advising government.
IP Australia's activities contributing toward the outcome are classified as departmental. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by IP Australia in its own right.
Departmental activities are identified under three programs:
- Program 1.1 - IP Rights Administration and Professional Registration.
- Program 1.2 - Education and Awareness; and
- Program 1.3 - Advice to Government and International Engagement.
IP Australia operates on a cost recovery basis, funding its operations almost entirely through revenues raised from charges for intellectual property services. Appropriation is received for advice to Government and international engagement. The use of a Special Account, established under the Public Governance, Performance and Accountability Act 2013, enables IP Australia to fund its operations from the revenue received from charges for intellectual property services.
The Basis of Preparation of the Financial Statements
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 – Reduced Disclosure Requirements issued by 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 historical cost convention, except for certain assets and liabilities reported 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
All new and amending standards or interpretations applicable to the current financial year did not have a material effect on IP Australia’s financial statements.
Resources Received Free of Charge
Resources received free of charge are recognised when, and only when, a fair value can be reliably determined, and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense. Resources received free of charge are recorded as either revenue or gains depending on their nature.
Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition.
Revenue from Government
Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when IP Australia gains control of the appropriation. Appropriations receivable are recognised at their nominal amounts.
Significant Accounting Judgements and Estimates
IP Australia has used accounting judgements and estimates when applying accounting policies. Information about judgements made in applying accounting policies that have the most significant effects on the amounts recognised in the financial statements is included in the following notes:
- Note 2.2 2.2: Non-Financial Assets– leasehold improvements and plant & equipment – the fair value of IP Australia’s leasehold improvements and plant and equipment has been taken to be the market value of similar items or depreciated replacement cost as determined by an independent valuer. In some instances, IPA’s leasehold improvements that were purposed-built and some specialised plant and equipment may in fact realise more or less in the market.
- Note 2.3B 2.3: Payables– employee payables – IP Australia uses estimation to value employee payables at 30 June including salary and wages and superannuation obligations.
- Note 2.5 2.5: Provisions– employee provisions – IP Australia uses judgements and estimates in determining the cost of future leave liabilities. The present value of the liability takes into account expected attrition rates and pay increases through promotion and inflation. The estimated value has been determined with reference to work of an actuary as at 31 January 2019. IP Australia engages Australian Government Actuary with regularity to ensure judgements are current.
Contingent Liabilities and Contingent Assets
IP Australia had no quantifiable or unquantifiable contingent liabilities or assets at 30 June 2021 (2019-20: nil).
IP Australia is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST). Revenues, expenses, and assets are recognised net of GST except:
- where the amount of GST incurred is not recoverable from the Australian Taxation Office; and
- for receivables and payables.
Events After the Reporting Period
There are no events occurring after statement of financial position date that materially affect the financial statements.