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Budget Variances Commentary for the period ended 30 June 2019

Explanations of major variances

Affected line items

The Mint has experienced the impact of the recognised global decline in demand for circulating coin. This has been seen in a reduction in both revenue and expenses associated with circulating coin. The Mint has seen a reduction in staff numbers during 2018/19 due to a number of retirements, and efficiency improvement in production and packaging. Supplier costs were reduced as a result of changes to the product mix being ordered by customers. A reduction in precious metal products within the mix has a corresponding reduction on supplier costs due to the raw material costs being proportionally higher in these products. This affected the supplier expenses and revenue, had an impact on cash received for supply of goods and services, and the cash paid to suppliers.

The write-down of inventory is a non-budgeted item and was significantly reduced from the prior year.

The demand for circulating coin was down affecting the cash received from the face value of circulating coins and cash returned to the government in seigniorage. There was no impact on the net cash of the Mint.

Income tax expense is higher due to the better performance in commercial business compared to budget, which resulted in higher taxable profit for competitive neutrality income tax purposes.

Statement of Financial Performance - Employee Benefits, Suppliers, Write-down and Impairment of Assets, Sale of Goods and Rendering of Services

Cash Flow Statement - Cash Used - Employees, Suppliers, Net Competitive Neutrality Payments, Payments to the Commonwealth - Seigniorage

Cash Flow Statement - Cash Received - Face Value - Circulating Coin, Goods and Services