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Part 4: Financial statements

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Notes to and forming part of the financial statements

for the period 1 July 2013 to 30 June 2014

Note/Description

Note 1: Summary of significant accounting policies

1.1 Objectives of the Attorney- General's Department

The Attorney-General's Department (the Department) is the central policy and coordinating body of the Attorney-General's portfolio. It is a not-for-profit entity.

The Department seeks to achieve the outcome of a just and secure society, and a creative Australia, through the maintenance and improvement of Australia's law and justice framework and its national security and emergency management system and support for cultural programmes:

Outcome 1: A just and secure society through the maintenance and improvement of Australia's law and justice framework and its national security and emergency management system.

Departmental and Administered activities are identified under eight programs for Outcome 1. The eight programs within Outcome 1 are: Attorney-General's Department Operating Expenses - Civil Justice and Legal Services (1.1), Attorney-General's Department Operating Expenses - National Security and Criminal Justice (1.2), Justice Services (1.3), Family Relationships (1.4), Indigenous Law and Justice (1.5), National Security and Criminal Justice (1.6), Australian Government Disaster Financial Support Payments (1.7) and Royal Commissions (1.8).

Outcome 2: Participation in, and access to, Australia's arts and culture through developing and supporting cultural expression.

Departmental and Administered activities are identified under one program for Outcome 2. The program within Outcome 2 is: Arts and Cultural Development (2.1).

The continued existence of the Department in its present form and with its present programs is dependent on Government policy and on continuing funding by Parliament for the Department's administration and programs.

The Department's activities contributing toward these outcomes are classified as either departmental or administered. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the Department in its own right. Administered activities involve the management or oversight by the Department, on behalf of the Government, of items controlled or incurred by the Government.

The Australian Government continues to have regard to developments in case law, including the High Court's most recent decision on Commonwealth expenditure in Williams v Commonwealth (2014) HCA 23, as they contribute to the larger body of law relevant to the development of Commonwealth programs. In accordance with its general practice, the Government will continue to monitor and assess risk and decide on any appropriate actions to respond to risks of expenditure not being consistent with constitutional or other legal requirements.

1.2 Basis of preparation of the financial statements

The financial statements are required by section 49 of the Financial Management and Accountability Act 1997 and are general purpose financial statements.

The financial statements and notes have been prepared in accordance with:

  • The Finance Minister's Orders (FMOs) for reporting periods ending on or after 1 July2011; and
  • 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 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.

Unless an alternative treatment is specifically required by an accounting standard or the FMOs, assets and liabilities are recognised in the statement of financial position when and only when it is probable that future economic benefits will flow to the Department, or a future sacrifice of economic benefits will be required, and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under executor contracts are not recognised unless required by an accounting standard. Liabilities and assets that are unrecognised at balance date are reported in the schedule of commitments and the schedule of contingencies (other than unquantifiable or remote contingencies, which are reported at Note 12).

Unless an alternative treatment is specifically required by an accounting standard, income and expenses are recognised in the Statement of Comprehensive Income when and only when the flow, consumption or loss of economic benefits has occurred and can be reliably measured.

Administered revenues, expenses, assets and liabilities and cash flows reported in the Schedule of Administered Items and related notes are accounted for on the same basis and using the same policies as for departmental items, except where otherwise stated at Note 1.20. Administered items are distingushed by shading in these financial statements.

1.3 Significant accounting judgements and estimates

In the process of applying the accounting policies listed in this note, the Department has made the following judgements that have the most significant impact on the amounts recorded in the financial statements:

  • The fair value of land and buildings has been taken to be the market value of similar properties. In some instances, the Department's buildings are purpose built and may in fact realise more or less in the market. At 30 June 2014 an expert valuer undertook a revaluation of the Department's land and buildings;
  • The fair value of artworks held by Artbank is determined using indicative market rates (via  regular ) by an expert valuer;
  • The fair value of the Department's property, plant and equipment has been taken to be the market selling price or depreciated replacement cost (whichever is applicable); and
  • The Department recognises the present value of the superannuation provision associated with the former Solicitor-General pension. At 30 June 2014 an expert valuer undertook an actuarial assessment of the scheme.

No accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next accounting period.

1.4 New Australian 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 standard was issued prior to the signing of the statement by the chief executive and chief financial officer, was applicable to the current reporting period and had a material effect on the Department's financial statements:

  • AASB 13 Fair Value Measurement - December 2012 (Compilation)
  • AASB 119 Employee Benefits - December 2012 (Compilation)

All other new standards, amendments to standards and interpretations that were issued prior to the sign-off date and are applicable to the current reporting period did not have a material effect, and are not expected to have a future material effect, on the Department's financial statements.

Future Australian Accounting Standard Requirements

The following new standards, amendments to standards and interpretations were issued by the Australian Accounting Standards Board prior to the sign-off date. These are expected to have a financial impact on the Department for future reporting periods:

  • AASB 9 Financial Instruments - December 2013 (Compilation)
  • AASB 1031 Materiality - December 2013 (Principal)
  • AASB 1055 Budgetary Reporting - March 2013 (Principal)
  • AASB 2013–3 Amendments to AASB 136 - Recoverable Amount Disclosures for Non-Financial Assets

1.5 Revenue

Sales of goods and services

Revenue from the sale of goods is recognised when:

  1. the risks and rewards of ownership have been transferred to the buyer;
  2. the Department retains no managerial involvement or effective control over the goods;
  3. the revenue and transaction costs incurred can be reliably measured; and
  4. it is probable that the economic benefits associated with the transaction will flow to the Department.

Revenue from rendering of services is recognised by reference to the stage of completion of contracts at the reporting date. The revenue is recognised when:

  1. the amount of revenue, stage of completion and transaction costs incurred can be reliablymeasured; and
  2. the probable economic benefits associated with the transaction will flow to the Department.

The stage of completion of contacts at the reporting date is determined by reference to the proportion that costs incurred to date bear to the estimated total costs of the transaction.

Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any impairment allowance account. Collectability of debts is reviewed during the financial year and at end of the reporting period. Impairment allowances are made when collectability of the debt is no longer probable.

Interest revenue is recognised using the effective interest method as set in AASB 139 Financial Instruments: Recognition and Measurement.

Revenue from Government

Amounts appropriated for departmental outputs for the year (adjusted for any formal additions and reductions) are recognised as revenue from Government when the Department gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned.

Appropriations receivable are recognised at their nominal amounts.

1.6 Gains

Resources received free of charge

Resources received free of charge are recognised as gains 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, unless received from another Government agency or authority as a consequence of a restructuring of administrative arrangements (refer to Note 1.7).

 Sale of assets

Gains from disposal of assets are recognised when control of the asset has passed to the buyer.

1.7 Transactions with the Government as Owner

Equity injections

Amounts appropriated which are designated as 'equity injections' (less any formal reductions).

Departmental Capital Budgets (DCBs) are recognised directly in contributed equity in that year.

Restructuring of administrative arrangements

Net assets received from or relinquished to another Australian Government agency or authority under a restructuring of administrative arrangements are recorded at their book value directly against contributed equity.

Other distribution to Owners

Distributions to owners are debited to contributed equity unless in the nature of a dividend.

1.8 Employee benefits

Liabilities for 'short-term employee benefits' (as defined in AASB 119 Employee Benefits) and termination benefits due within twelve months of balance date are measured at their nominal amounts.

The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

Other long-term employee benefits are measured as the net total of the present value of the defined benefit obligation at the end of the reporting period.

Leave

The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of the Department is estimated to be less than the annual entitlement for sick 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 Department's 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 work of an actuary as at 30 June 2014. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and redundancy

Provision is made for separation and redundancy benefit payments. The Department recognises a provision for termination 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

The majority of the staff of the Department are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS) or the PSS accumulation plan (PSSap).

The CSS and PSS are defined benefit schemes for the Australian Government. 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 by the Department of Finance's administered schedule and notes.

The Department makes employer contributions to the employees' superannuation scheme at rates determined by an actuary to be sufficient to meet the cost to the Government. The Department accounts for the contributions as if they were contributions to defined contribution plans.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.

1.9 Leases

A distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and rewards incidental to ownership of leased assets. An operating lease is a lease that is not a finance lease. In operating leases, the lessor effectively retains substantially all such risks and benefits.

Where an asset is acquired by means of a finance lease, the asset is capitalised at either the fair value of the lease property or, if lower, the present value of minimum lease payments at the inception of the contract and a liability is recognised at the same time and for the same amount.

The discount rate used is the interest rate implicit in the lease. Leased assets are amortised over the period of the lease. Lease payments are allocated between the principal components and the interest expense.

Operating lease payments are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets.

1.10 Borrowing costs

All borrowing costs are expensed as incurred.

1.11 Fair value measurement

The Department deems transfers between levels of the fair value hierarchy to have occurred when evidence arises during assessment that a change in level has occurred.

1.12 Cash

Cash and cash equivalents includes cash on hand, cash held with outsiders, demand deposits in bank accounts with an original maturity of three months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value and cash in special accounts. Cash is recognised at its nominal amount.

1.13 Financial assets

The Department classifies its financial assets as loans and receivables. The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.

Financial assets are recognised and derecognised upon trade date.

Effective interest method

The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, or, where appropriate, a shorter period.

Income is recognised on an effective interest rate basis except for financial assets that are recognised at fair value through profit or loss.

Loans and receivables

Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.

Impairment of financial assets

Financial assets are assessed for impairment at the end of each reporting period.

Financial assets held at amortised cost – if there is objective evidence that an impairment loss has been incurred for loans and receivables held at amortised cost, the amount of the loss is measured as the difference between the asset's carrying amount and the present value of estimated future cash flows discounted as the asset's original effective interest rate. The carrying amount is reduced by way of an allowance account. The loss is recognised in the Statement of Comprehensive Income.

1.14 Financial liabilities

Financial liabilities are classified as other financial liabilities.

Financial liabilities are recognised and derecognised upon 'trade date'.

Other financial liabilities

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

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, where appropriate, a shorter period.

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

1.15 Contingent liabilities and contingent assets

Contingent liabilities and contingent assets are not recognised in the statement of financial position but are reported in the relevant schedules and 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.

1.16 Acquisition of assets

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 amount at which they were recognised in the transferor agency's accounts immediately prior to the restructuring.

1.17 Property, plant and equipment

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 $2,000 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 'makegood' cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant in property leases taken up by the Department where there exists an obligation to restore the property to its original condition. These costs are included in the value of leasehold improvements with a corresponding provision for the 'makegood' recognised.

Revaluations

Fair values for each class of asset are determined as shown below:

Asset Class: Fair value measured at:
Land Market selling price
Buildings Market selling price
Leasehold improvements Depreciated replacement cost
Property, plant and equipment Market selling price or Depreciated replacement cost
Heritage and cultural assets Market selling price or Depreciated replacement cost

Following initial recognition at cost, property, plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. 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.

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 the Department using, in all cases, the straight-line method of depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease. The library assets which have been recognised as property, plant and equipment are not depreciated, and all other library acquisitions are expenses in the year of acquisition.

Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current and future reporting periods, as appropriate.

Depreciation rates applying to each class of depreciable departmental asset are based on the following useful lives:

2014
2013
 
 
 
Buildings on freehold land
25-50 years
25-50 years
Leasehold improvements
Lease term
Lease term
Property, plant and equipment
3 to 10 years
3 to 10 years
Heritage and cultural (where applicable)
Up to 480 years
Up to 200 years
 
 
 

Depreciation rates applying to each class of depreciable administered asset are based on the following useful lives:

2014
2013
 
 
 
Buildings on freehold land
25-50 years
nil
Property, plant and equipment
3 to 10 years
3 to 10 years

Impairment

All assets were assessed for impairment at 30 June 2014. 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 to sell 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 Department were deprived of the asset, its value in use is taken to be it depreciated replacement cost.

Derecognition

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

Heritage and cultural

Heritage and cultural items include artworks held by Artbank and a comprehensive collection of law and selected works in other subject areas that are of interest to the Department's strategic agenda and are of national, historical or cultural significance.

The Department acquires items for the collection from a range of publishers, second hand dealers, book agents, donations or government publishing agents.

Heritage and cultural assets are stored and managed in ways to preserve their heritage and cultural value over time. The Department's conservation and preservation policies include binding loose parts into bound volumes, secure storage of significant items thereby limiting distribution and restoration of items such as Hansard.

Artbank maintains separate curatorial and preservation policies for heritage and cultural assets (http://www.artbank.gov.au/preservation.html)

Artbank maintain an ongoing preservation and collections maintenance program to preserve the physical integrity of each artwork in the collection. However, not all items are given the same level of care, security and attention. While priority is given to works requiring immediate intervention to arrest further damage to at risk works, as a rental collection, priority is also determined by client demand of specific works.

1.18 Intangibles

The Department'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 the Department's intangibles are 3 to 5 years (2012-13: 3 to 5 years). 

1.19 Taxation

The Department is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).

Revenue, expenses and assets are recognised net of GST except:

  1. where the amount of GST incurred is not recoverable from the Australian TaxationOffice; and
  2. for receivables and payables.

1.20 Reporting of administered activities

Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the Schedule of Administered Items and related notes.

Except where otherwise stated below, administered items are accounted for on the same basis and using the same policies as for departmental items, including the application of Australian Accounting Standards.

Administered cash transfer to and from the Official Public Account

Revenue collected by the Department for use by the Government rather than the Department is administered revenue. Collections are transferred to the Official Public Account (OPA) maintained by the Department of Finance. Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriation on behalf of Government. These transfers to and from the OPA are adjustments to the administered cash held by the entity on behalf of the Government and reported as such in the schedule of administered cash flows and in the administered reconciliation schedule.

Revenue

All administered revenues are revenues relating to the course of ordinary activities performed by the Department on behalf of the Australian Government. As such, administered appropriations are not revenues of the Department.

Dividend revenue represents dividends received from entities, which mainly relate to administered investments of the Department and is recognised when the dividend has been declared and the right to receive the dividend has been established.

Competitive neutrality

The Australian Government Solicitor (AGS) is a portfolio related entity and operates on a for profit basis. As an agency within the Australian Government it is not subject to taxation other than GST and FBT. However, under competitive neutrality arrangements, the AGS is required to make payroll tax, income tax, and practicing certificates equivalent payments to the Government.

Expenses

All administered expenses are expenses relating to the course of ordinary activities performed by the Department on behalf of the Australian Government.

Loans and receivables

Where loans and receivables are not subject to concessional treatment, they are carried at amortised cost using the effective interest method. Gains and losses due to impairment, derecognition and amortisation is recognised through profit and loss.

Concessional loans are initially recognised at their fair value. If the rate of interest charged is lower than the government bond rate (for government/public sector loans) or the counterparty's borrowing rate (for non government loans) the difference between the amortised cost and the fair value of the loan is treated as an expense.

Administered investments

Administered investments in controlled entities are not consolidated because their consolidation is relevant only at the Whole of Government level.

Administered investments other than those held for sale are measured at their fair value at 30 June 2014. Fair value has been taken to be the Australian Government's proportional interest in the net assets of the entities as at the end of the reporting period.

Grants and subsidies

The Department administers a number of grant and subsidy schemes on behalf of the Government.

Grant and subsidy liabilities are recognised to the extent that

  1. the services required to be performed by the grantee have been performed or
  2. the grant eligibility criteria have been satisfied, but payments due have not been made.

A commitment is recorded when the Government enters into an agreement to make these grants but services have not been performed or criteria satisfied.

Payments to CAC Act bodies

Payments to CAC Act bodies from amounts appropriated for that purpose are classified as administered expenses, equity injections or loans of the Department. The appropriation to the Department is disclosed in Table A of the Note 30.

Superannuation provisions

The Department recognises an administered liability for the present value of the Australian Government's expected future payments arising from the former Solicitors-General Pension scheme.

Increases in the accrued benefits liability, pursuant to regular estimates of the liability taking account of actuarial reviews, are recognised as an expense and classified as personal benefit expense, except for actuarial gains or losses which are recognised in equity. In accordance with AASB 119 Employee Benefits, the liability is assessed annually by applying the projected unit credit method in assessing the balance of the liability. The rate used to discount long term employee benefits and post employment benefits is determined by reference to the government bond rate at the reporting date on high quality corporate bonds except where there is not a deep market in these bonds, in which case the market yield on national government bonds is used. In the case of discounting the personal benefit liability, the market yield on government bonds has been used. Additional information can be found at Note 23.

Note 2: Events after the reporting period

There were no subsequent events that had the potential to significantly affect the ongoing structure and financial activities of the Department.

There were no subsequent events that had the potential to significantly affect the ongoing structure and financial activities of the Department.

Note 3: Expenses

3A: Employee benefits

 
 
2014
2013
 
Notes
$'000
$'000
Wages and salaries
 
132,815
119,566
Superannuation
 
 
 
Defined benefit plans
 
17,216
15,217
Defined contribution plans
 
8,790
7,788
Leave and other entitlements
 
15,025
13,797
Separation and redundancies
 
8,772
973
Other employee benefit expenses
 
 
 
Recruitment and security vetting expenses
 
1,129
1,096
Health & wellbeing payments to staff
 
587
468
Comsuper charges
 
308
308
Study assistance
 
368
462
Other employee expenses
 
532
558
Total employee benefits
 
185,542
160,233

3B: Suppliers

Goods and services supplied or rendered
 
2014
2013
 
Notes
$'000
$'000
Accommodation expenses
 
4,660
3,827
Consultants
 
2,357
791
Contractors
 
4,841
4,938
Travel
 
6,556
5,738
Information technology and communications
 
9,484
10,432
General office
 
12,510
6,330
AusCheck expenditure
 
7,977
6,449
Legal fees
 
14,150
11,798
Audit fees
 
839
748
Defence Abuse Response Taskforce expenses 1
 
 
 
Defence Abuse Response Taskforce outcome payments 2
 
31,540
-
Contractors
 
2,564
1,080
Information technology and communications
 
746
817
Legal fees
 
702
95
General office
 
1,636
515
Payments and contributions to external bodies
 
8,014
3,262
Total goods and services supplied or rendered
 
108,576
56,820
Goods supplied in connection with
 
 
 
Related parties
 
246
76
External parties
 
3,172
2,499
Total goods supplied
 
3,418
2,575
Services rendered in connection with
 
 
 
Related parties
 
27,114
19,740
External parties
 
78,044
34,505
Total services rendered
 
105,158
54,245
Total goods and services supplied or rendered
 
108,576
56,820
Other suppliers
 
 
 
Operating lease rentals in connection with
 
 
 
External parties
 
 
 
Minimum lease payments
 
25,798
21,579
Workers compensation expenses
 
1,832
1,295
Total other suppliers
 
27,630
22,874
Total suppliers
 
136,206
79,694

3C: Grants

 
2014
2013
 
Notes
$'000
$'000
Public sector
 
 
 
State and Territory Governments
 
1,384
100
Private sector
 
 
 
Non-profit organisations
 
995
428
Other private sector
 
160
15
Overseas
 
80
60
Other grants
 
250
105
Total grants
 
2,869
708

3D: Depreciation and amortisation

 
2014
2013
 
Notes
$'000
$'000
Depreciation
 
 
 
Buildings and leasehold improvements
7C
8,403
6,741
Property, plant and equipment
7C
9,007
8,016
Total depreciation
 
17,410
14,757
Amortisation
 
 
 
Intangibles: computer software
7E
8,615
6,742
Total amortisation
 
8,615
6,742
Total depreciation and amortisation
 
26,025
21,499

3E: Write-down and impairment of assets and other expenses

 
2014
2013
 
Notes
$'000
$'000
Impairment of property, plant and equipment
11
1,852
37
Impairment of financial instruments
15B,11
20
19
Defective administration scheme payments
32
-
1
Unwinding of makegood expense
9B,11
(317)
14
Total write-down and impairment of assets and other expenses
 
1,555
71

1 On 26 November 2012, the Defence Abuse Response Taskforce was established as part of the Government's response to the DLA Piper Review into allegations of sexual and other abuse in Defence by the Department,. These costs represent expenses incurred by the Department which are reimbursed by the Department of Defence. The increase in expenditure for 2013-14 primarily reflects the Taskforce expenses that were invoiced to the Department of Defence $37.188m (2013: $2.507m) to 30 June 2014.

2 Defence Abuse Response Taskforce outcome payments assist in implementing the national programs relating to the Reparation Scheme; Restorative Engagement Program and the nationwide Defence Abuse Counselling Scheme.

Note 4: Own-source income

Own source revenue

4A: Sale of goods and rendering of services
 
2014
2013
 
Notes
$'000
$'000
Sale of goods in connection with
 
 
 
Related parties
 
-
226
External parties
 
220
390
Total sale of goods
 
220
616
 
 
 
 
Rendering of services in connection with
 
 
 
Related parties 1
 
80,927
29,368
External parties
 
15,866
13,456
Total rendering of services
 
96,793
42,824
Total sale of goods and rendering of services
 
97,013
43,440
 
 
 
 
4B: Other revenue
 
 
 
Special Account receipts
 
2,102
-
Total other revenue
 
2,102
-
 
 
 
 
Total own source income
 
99,115
43,440

Gains

4C: Other gains
 
2014
2013
 
Notes
$'000
$'000
Resources received free of charge - ANAO
14
470
405
Assets first recognised 2
7C
460
-
Total other gains
 
930
405
 
 
 
 
4D: Revenue from Government
 
 
 
Appropriations
 
 
 
Departmental appropriations
 
230,399
198,397

1 On 26 November 2012 the Defence Abuse Response Taskforce was established as part of the Government's response to the DLA Piper Review into allegations of sexual and other abuse in Defence by the Department, with all costs to be reimbursed by the Department of Defence. The increase in revenue for 2013-14 primarily reflects the Taskforce expenses that were invoiced to the Department of Defence $53.560m (2013: $7.905m) to 30 June 2014.

2 The Department recognised library collections associated with the Ministry for the Arts $0.030m and the Australian Emergency Management Institute $0.430m for the first time. The items are recorded at fair value.

Note 5: Fair value measurements

The following tables provide an analysis of assets and liabilities that are measured at fair value.

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

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the department can access at measurement date (30 June 2014).

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

Level 3: Unobservable inputs for the asset or liability.

5A: Fair value measurements

Fair value measurements at the end of the reporting period by hierarchy for assets in 2014

   
Fair value measurements at the end of the reporting period using
 
Fair Value
Level 1 inputs
Level 2 inputs
Level 3 inputs
 
$'000
$'000
$'000
$'000
Non-financial assets
 
 
Land
1,400
-
-
1,400
Buildings on freehold land
510
-
-
510
Leasehold improvements
64,226
-
-
64,226
Property, plant and equipment
20,293
-
5,711
14,582
Heritage and cultural
41,101
-
35,265
5,836
Total non-financial assets
127,530
-
40,976
86,554
Total fair value measurements
127,530
-
40,976
86,554
 
 
 
 
 
Assets not measured at fair value in the statement of financial position
 
 
 
 
Non-financial assets 1
-
-
-
-

1 The Department did not measure any non-financial assets at fair value on a non-recurring basis as at 30 June 2014.

Fair value measurements - highest and best use

The Department's assets are held for operational purposes and not held for the purposes of deriving a profit. The current use of all controlled assets is considered their highest and best use. The Department considers the highest and best use of the artworks associated with Artbank to be use in the Commonwealth's Art Rental scheme.

5B: Level 1 and Level 2 transfers for recurring fair value measurements

There have been no transfers between levels of the hierarchy during the year.

The Department's policy for determining when transfers between levels are deemed to have occurred can be found at Note 1.

5C: Valuation technique and inputs for Level 2 and Level 3 fair value measurements

Level 2 and 3 fair value measurements - valuation technique and the inputs used for assets in 2014

 
Category (Level 2 or Level 3)
Fair Value
Valuation technique(s) 1
Inputs used
Range (weighted average) 2
 
 
$'000      
Non-financial assets
 
       
Land
3
1,400
Market approach
Price per square metre
$450 - $600 ($500)
Buildings on freehold land
3
510
Income approach
Rental price per square metre
 
 
 
   
Capitalisation rate
7.0% - 9.0% (8.0%)
Leasehold improvements
3
64,226
Depreciated replacement cost (DRC)
Replacement cost new
 
 
 
   
Consumed economic benefit / Obsolescence of asset
5.0% - 38.7% (7.0%) per annum
Property, plant and equipment
2
5,711
Market approach
Adjusted market transactions
N/A
Property, plant and equipment
3
14,582
Depreciated replacement cost (DRC)
Replacement cost new
 
       
Consumed economic benefit / Obsolescence of asset
9.5% - 50.0% (19.9%) per annum
Heritage and cultural (Artbank Artwork)
2
35,171
Market approach
Adjusted market transactions
N/A
Heritage and cultural (Library)
2
94
 
Consumed economic benefit / Obsolescence of asset
9.5% - 50.0% (19.9%) per annum
Heritage and cultural (Library)
3
5,836
Depreciated replacement cost (DRC)
Replacement cost new (Average acquisition cost per title)
$5 - $550
       
Consumed economic benefit / Obsolescence of asset
2.5% - 10.0% (6.4%) per annum

1. There have been no changes to valuation techniques.

2. Significant unobservable input only. Not applicable for assets or liabilities in the Level 2 category.

Recurring and non-recurring Level 3 fair value measurements - valuation process

Australian Valuation Solutions Pty Ltd (AVS) undertook a review of all non-financial assets at 30 June 2014. The Department tests the procedures of the valuation models at least once every 12 months (as obtained at least once every three years) via desktop reviews. If a particular asset class experiences significant and volatile changes in fair value (i.e. where indicators suggest that the value of the class has changed significantly since the previous reporting period), that class is subject to specific valuation in the reporting period, where practicable, regardless of the timing of the last specific valuation. The Department has engaged AVS to provide written assurance that the models developed comply with AASB 13.

There is no change in the valuation technique since the prior year.

Significant Level 3 inputs used by the Department are derived and evaluated as follows:

Land - Price per square metre

The land asset has been measured using the market approach by reference to similar transactions within the surrounding locality. The adopted price per square metre has been determined based on professional judgment regarding the comparability of transactions to the subject asset.

Leasehold Improvements, Property, Plant and Equipment, Heritage and Cultural (Library) - 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 approach. Under the cost approach the estimated cost to replace the asset is calculated and then adjusted to take into account the consumed economic benefit and/or obsolescence (accumulated depreciation). The consumed economic benefit and/or obsolescence has been determined based on professional judgment regarding physical, economic and external obsolescence factors relevant to the asset under consideration.

Buildings - capitalisation rate

The income capitalisation approach has been adopted to determine the fair value of the Protective Security Training College. Under the income capitalisation approach the net market rental is capitalised at an appropriate yield as determined from comparable sales transactions. The analysis and selection of an appropriate yield is determined based on professional judgement.

Recurring Level 3 fair value measurements - sensitivity of inputs

Land - price per square metre

The significant unobservable inputs used in the fair value measurement of the entity's Land asset class relate to the price per square metre. A significant increase (decrease) in this input would result in a significantly higher (lower) fair value measurement.

Leasehold Improvements, Property, Plant and Equipment - consumed economic benefit / obsolescence of asset

The significant unobservable inputs used in the fair value measurement of the entity's Leasehold Improvements, Property, Plant and Equipment asset classes relate to the consumed economic benefit / obsolescence of asset. A significant increase (decrease) in this input would result in a significantly lower (higher) fair value measurement.

Buildings - capitalisation rate

The significant unobservable inputs used in the fair value measurement of the entity's Buildings asset class relate to the capitalisation rate. A significant increase (decrease) in this input would result in a significantly lower (higher) fair value measurement.

5D: Reconciliation for recurring Level 3 fair value measurements

Recurring Level 3 fair value measurements - reconciliation for assets

   
Non-financial assets
 
Land
Buildings
Leasehold improvements
Property, plant and equipment
Heritage and cultural
Total
 
2014
$'000
2014
$'000
2014
$'000
2014
$'000
2014
$'000
2014
$'000
Opening balance 1
1,400
888
71,492
9,977
1,663
85,420
Total gains/(losses) recognised in other comprehensive income 2
-
53
100
-
3,713
3,866
Purchases
-
(400)
989
7,623
-
8,212
Depreciation
-
(31)
(8,372)
(3,018)
-
(11,421)
Other movements 3, 4
-
-
66
 
460
526
Disposals
-
-
(49)
-
-
(49)
Closing balance
1,400
510
64,226
14,582
5,836
86,554
 
 
 
 
 
 
 
Changes in unrealised gains/(losses) recognised in net cost of services 5
-
53
100
-
3,713
3,866

1. Opening balance as determined in accordance with AASB 13.

2. These gain/(losses) are presented in the Statement of Comprehensive Income under Other Comprehensive Income.

3. As a result of 18 September 2013 Administrative arrangements, the Department assumed responsibility for the Arts and Culture function from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).

4. The Department has recognised the library at the Australian Emergency Management Institute (AEMI), Mount Macedon facility and the Ministry for the Arts (MFTA) library for the first time. The amount to be recognised is $0.460m.

5. These unrealised gains/(losses) are presented in the Statement of Comprehensive Income under Other Comprehensive Income.

The Department's policy for determining when transfers between levels are deemed to have occurred can be found in Note 1.

Note 6: Financial assets

6A: Cash and cash equivalents

 
 
2014
2013
 
Notes
$'000
$'000
Cash on hand or on deposit
 
2,737
1,794
Art Rental special account
 
1,657
-
Total cash and cash equivalents
15A
4,394
1,794

6B: Trade and other receivables

Goods and services receivables in connection with
 
2014
2013
 
Notes
$'000
$'000
Related parties
 
8,431
3,117
External parties
 
14,656
4,365
Total goods and services receivables
15A
23,087
7,482
 
 
 
 
Appropriations receivable
 
 
 
Existing programs
 
62,349
47,889
Special accounts
 
3,897
-
Total appropriations receivables
 
66,246
47,889
 
 
 
 
Other receivables
 
 
 
GST receivable from the Australian Taxation Office
 
1,504
1,037
Other
 
46
45
Total other receivables
 
1,550
1,082
Total trade and other receivables (gross)
 
90,883
56,453
 
 
 
 
Less impairment allowance
 
 
 
Goods and services
 
(32)
(18)
Total impairment allowance
 
(32)
(18)
Total trade and other receivables (net)
 
90,851
56,435
 
 
 
 
Trade and other receivables (net) expected to be recovered in
 
 
 
No more than 12 months
 
90,851
56,435
Total trade and other receivables (net)
 
90,851
56,435
 
 
 
 
Trade and other receivables (gross) aged as follows
 
 
 
Not overdue
 
89,724
54,892
Overdue by
 
 
 
0 to 30 days
 
700
658
31 to 60 days
 
147
394
61 to 90 days
 
59
37
More than 90 days
 
253
472
Total trade and other receivables (gross)
 
90,883
56,453
 
 
 
 
Impairment allowance aged as follows
 
 
 
Overdue by
 
 
 
More than 90 days
 
(32)
(18)
Total impairment allowance
 
(32)
(18)

Credit terms for goods and services were within 30 days (2013: 30 days).

Reconciliation of the impairment allowance
Movements in relation to 2014

 
 
Goods and services
Total
 
Notes
$'000
$'000
 
 
$'000
$'000
Opening balance
 
18
18
Increase recognised in statement of comprehensive income
 
14
14
Closing balance
 
32
32
 
 
 
 
Movements in relation to 2013
 
 
 
Opening balance
 
20
20
Amounts recovered and reversed
 
(2)
(2)
Closing balance
 
18
18

Note 7: Non-financial assets

7A: Land and buildings

   
 
2014
2013
   
Notes
$'000
$'000
Land
 
 
 
 
  Fair value
7C
1,400
1,400
   
 
 
 
Buildings on freehold land
 
 
 
 
  Fair value
7C
510
888
   
 
 
 
Leasehold improvements
 
 
 
 
  Fair value
 
64,323
70,990
  Accumulated depreciation
 
(77)
-
  Work in progress (at cost)
 
-
502
Total leasehold improvements
 
7C
64,246
71,492
Total land and buildings
 
7C
66,156
73,780

No indicators of impairment were found for land and buildings.

No land or buildings are expected to be sold or disposed of within the next 12 months.

A revaluation of land and buildings was undertaken by an independent valuer with effect from 30 June 2014. A nil revaluation movement for land (2013: increment of $535,000), a revaluation increment of $53,269 for buildings on freehold land (2013: increment of $174,008) and a revaluation increment of $99,631 for leasehold improvements (2013: decrement of $472,413) were credited to the asset revaluation surplus by asset class and included in the equity section of the balance sheet.

7B: Property, plant and equipment

   
 
2014
2013
   
Notes
$'000
$'000
Heritage and cultural
 
 
 
 
  Library (at fair value)
 
5,930
1,663
  Artworks - Artbank (at fair value)
 
35,171
-
Total heritage and cultural
 
7C
41,101
1,663
   
 
 
 
Other property, plant and equipment
 
 
 
 
  Fair value
 
52,633
44,721
  Accumulated depreciation
 
(33,655)
(25,217)
Total other property, plant and equipment
 
7C
18,978
19,504
Total property, plant and equipment
 
 
60,079
21,167

No indicators of impairment were found for property, plant and equipment.

No property, plant or equipment are expected to be sold or disposed of within the next 12 months.

A revaluation of heritage and cultural was undertaken by an independent valuer with effect from 30 June 2014. A revaluation increment of $3,386,926 for heritage and cultural (2013: nil movement) was credited against the asset revaluation surplus by asset class and included in the equity section of the balance sheet.

Note 7C: Reconciliation of the opening and closing balances of property, plant and equipment for 2013-14

 
Land
Buildings
Leasehold improvements
Total land
and buildings
Heritage
and
cultural 1
Other
property,
plant & equipment
Total
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
As at 1 July 2013
 
 
 
 
 
 
 
Gross book value
1,400
888
71,492
73,780
1,663
44,721
120,164
Accumulated depreciation and impairment
-
-
-
-
-
(25,217)
(25,217)
Total as at 1 July 2013
1,400
888
71,492
73,780
1,663
19,504
94,947
 
 
 
 
 
 
 
 
Additions
 
 
 
 
 
 
 
By purchase
-
-
989
989
373
7,518
8,880
Revaluations and impairments recognised in other comprehensive income
-
53
100
153
3,387
-
3,540
Assets first recognised 2
-
-
-
-
460
-
460
Depreciation expense
-
(31)
(8,372)
(8,403)
(100)
(8,907)
(17,410)
Other movements: transfer of assets from Department of Regional Australia, Local Government, Arts and Sport
-
-
86
86
37,014
511
37,611
Other movements - transfer assets between classes
-
(400)
-
(400)
-
400
-
Disposals
 
 
 
 
 
 
 
Property, plant and equipment
-
-
(49)
(49)
(1,696)
(48)
(1,793)
Total as at 30 June 2014
1,400
510
64,246
66,156
41,101
18,978
126,235
 
 
 
 
 
 
 
 
Total as at 30 June 2014 represented by
 
 
 
 
 
 
 
Gross book value
1,400
510
64,323
66,233
41,101
52,633
159,967
Accumulated depreciation and impairment
-
-
(77)
(77)
-
(33,655)
(33,732)
Total as at 30 June 2014
1,400
510
64,246
66,156
41,101
18,978
126,235

1 Artbank artwork assets and library assets that meet the definition of heritage and cultural items.

2 The Department recognised library collections associated with the Ministry for the Arts $0.030m and the Australian Emergency Management Institute $0.430m for the first time. The items are recorded at fair value.

 
Land
Buildings
Leasehold improvements
Total land
and buildings
Heritage
and
cultural 1
Other
property,
plant & equipment
Total
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
As at 1 July 2012
 
 
 
 
 
 
 
Gross book value
865
772
95,559
97,196
1,663
41,432
140,291
Accumulated depreciation and impairment
-
(49)
(21,858)
(21,907)
-
(17,319)
(39,226)
Total as at 1 July 2012
865
723
73,701
75,289
1,663
24,113
101,065
 
 
 
 
 
 
 
 
Additions
 
 
 
 
 
 
 
By purchase
-
18
5,292
5,310
-
3,520
8,830
Revaluations and impairments recognised in other comprehensive income
535
174
(472)
237
-
-
237
Depreciation expense
-
(27)
(6,714)
(6,741)
-
(8,016)
(14,757)
Other movements - transfer assets between Departmental and Administered 2
-
-
(315)
(315)
-
(60)
(375)
Disposals
 
 
 
 
 
 
 
From disposal of entities or operations (including restructuring) 3
-
-
-
-
-
(16)
(16)
Property, plant and equipment 4
-
-
-
-
-
(37)
(37)
Total as at 30 June 2013
1,400
888
71,492
73,780
1,663
19,504
94,947
 
 
 
 
 
 
 
 
Total as at 30 June 2013 represented by
 
 
 
 
 
 
 
Gross book value
1,400
888
71,492
73,780
1,663
44,721
120,164
Accumulated depreciation and impairment
-
-
-
-
-
(25,217)
(25,217)
Total as at 30 June 2013
1,400
888
71,492
73,780
1,663
19,504
94,947

1 Library assets that meet the definition of heritage and cultural items.

2 The movement relates to the transfer of the Royal Commission into Institutional Responses to Child Sexual Abuse (RCIRCSA) assets from departmental to administered financial statements to align with appropriation funding.

3 The Office of Legislative Drafting and Publishing function was relinquished to the Office of Parliamentary Counsel (OPC) on 1 October 2012 due to a restructuring of administrative arrangements (Note 10A refers).

4 Disposal of property, plant and equipment is a result of an office machine refresh project.

7D: Intangibles

for the period 1 July 2013 to 30 June 2014

   
 
2014
2013
   
Notes
$'000
$'000
Computer software
 
 
 
 
  Internally developed - in progress
 
2,307
2,108
  Internally developed - in use
 
37,024
34,981
  Purchased
 
14,816
13,529
  Accumulated amortisation
 
(33,401)
(24,786)
Total intangibles
 
7E
20,746
25,832

No indicators of impairment were found for intangibles.

No intangibles are expected to be sold or disposed of within the next 12 months.

Note 7E: Reconciliation of the opening and closing balances of intangibles for 2013-14

for the period 1 July 2013 to 30 June 2014

 
Computer
software
internally
developed
Computer
software
purchased
Total
 
$'000
$'000
$'000
As at 1 July 2013
 
 
 
Gross book value
37,089
13,529
50,618
Accumulated amortisation and impairment
(15,350)
(9,436)
(24,786)
Total as at 1 July 2013
21,739
4,093
25,832
 
 
 
 
Additions
 
 
 
By purchase
-
1,147
1,147
Internally developed
2,242
-
2,242
Total additions
2,242
1,147
3,389
Amortisation expense
(6,443)
(2,172)
(8,615)
Other movements: transfer of assets from Department of Regional Australia, Local Government, Arts and Sport
-
140
140
Total as at 30 June 2014
17,538
3,208
20,746
 
 
 
 
Total as at 30 June 2014 represented by
 
 
 
Gross book value
39,331
14,816
54,147
Accumulated amortisation and impairment
(21,793)
(11,608)
(33,401)
Total as at 30 June 2014
17,538
3,208
20,746

Reconciliation of the opening and closing balances of intangibles for 2012-13

 
Computer
software
internally
developed
Computer
software
purchased
Total
 
$'000
$'000
$'000
As at 1 July 2012
 
 
 
Gross book value
35,334
15,258
50,592
Accumulated amortisation and impairment
(13,443)
(7,834)
(21,277)
Total as at 1 July 2012
21,891
7,424
29,315
 
 
 
 
Additions
 
 
 
By purchase
-
1,123
1,123
Internally developed
5,415
-
5,415
Total additions
5,415
1,123
6,538
Amortisation expense
(4,353)
(2,389)
(6,742)
Other movements - transfer assets between asset classes
212
(212)
-
Disposals
 
 
 
From disposal of entities or operations (including restructuring) 1
(1,426)
(1,853)
(3,279)
Total as at 30 June 2013
21,739
4,093
25,832
 
 
 
 
Total as at 30 June 2013 represented by
 
 
 
Gross book value
37,089
13,529
50,618
Accumulated amortisation and impairment
(15,350)
(9,436)
(24,786)
Total as at 30 June 2013
21,739
4,093
25,832

1 The Office of Legislative Drafting and Publishing function was relinquished to the Office of Parliamentary Counsel (OPC) on 1 October 2012 due to a restructuring of administrative arrangements (Note 10 refers).

7F: Other non-financial assets

   
2014
2013
 
Notes
$'000
$'000
Prepayments  
5,810
4,652
   
 
 
Other non-financial assets expected to be recovered  
 
 
No more than 12 months  
5,034
4,152
More than 12 months  
776
500
Total other non-financial assets  
5,810
4,652

No indicators of impairment were found for other non-financial assets

Note 8: Payables

8A: Suppliers

   
2014
2013
 
Notes
$'000
$'000
Trade creditors  
5,822
6,022
Accrued payables  
14,111
11,327
Operating lease rentals  
12,066
9,684
Total suppliers  
31,999
27,033
   
 
 
Suppliers expected to be settled within 12 months  
 
 
Related parties  
1,141
1,701
External parties  
30,858
25,332
Total suppliers  
31,999
27,033

Settlement is usually made net 30 days.

8B: Grants

   
2014
2013
 
Notes
$'000
$'000
Private sector  
 
 
Overseas  
80
-
Total grants  
80
-
   
 
 
Grants expected to be settled  
 
 
No more than 12 months  
80
-
Total grants  
80
-

8C: Other payables

   
2014
2013
 
Notes
$'000
$'000
Wages and salaries  
4,824
3,533
Superannuation  
4,078
3,549
Separations and redundancies  
3,556
22
Other employee payables  
423
452
Unearned income 1  
22,829
8,606
FBT payable  
(200)
(195)
Lease incentives 2  
1,108
1,365
Total other payables  
36,618
17,332
   
 
 
Other payables expected to be settled
 
 
 
No more than 12 months
 
35,668
16,224
More than 12 months
 
950
1,108
Total other payables  
36,618
17,332

1 The increase in unearned revenue for 2013-14 primarily reflects the working capital received from the Department of Defence for the operation of the Defence Abuse Response Taskforce (DART) and associated outcome payments $10.090m (2013: nil) to 30 June 2014.

2 The Department has received incentives in the form of cash and discounted rent on entering into property operating leases.

Note 9: Provisions

9A: Employee provisions

   
2014
2013
 
Notes
$'000
$'000
Leave
 
41,554
37,900
 
 
 
 
Employee provisions expected to be settled
 
 
 
No more than 12 months
 
16,880
16,077
More than 12 months
 
24,674
21,823
Total employee provisions
 
41,554
37,900

9B: Makegood provision

   
2014
2013
 
Notes
$'000
$'000
Provision for makegood - operating leases
 
124
341
 
 
 
 
Makegood provisions expected to be settled
 
 
 
More than 12 months
 
124
341
Total makegood provisions
 
124
341
 
 
 
 
 
 
Provision for
restoration
Total
 
 
$'000
$'000
As at 1 July 2013
 
341
341
Additional provisions made
 
100
100
Amounts reversed
 
(317)
(317)
Total as at 30 June 2014
 
124
124

The Department currently has 12 (2013: 10) agreements for the lease of premises some of which have provisions requiring the Department to restore the premises to their original condition at the conclusion of the lease. The Department has made a provision to reflect the present value of this obligation.

9C: Other provisions

   
2014
2013
 
Notes
$'000
$'000
Provision for restoration - Mt Macedon decommission
 
88
-
Provision for onerous lease
 
3,480
-
Total other provisions
 
3,568
-
 
 
 
 
Other provisions expected to be settled
 
 
 
No more than 12 months
 
342
-
More than 12 months
 
3,226
-
Total other provisions
 
3,568
-

Note 10: Restructuring

Note 10A: Departmental restructuring

  2014 2013
  Arts and Cultural Development 1 Indigenous Programs and Functions 2 Office of Legislative Drafting and Publishing 3
  $'000 $'000 $'000
Functions assumed      
Assets recognised      
Cash and cash equivalents
1,192
-
-
Special accounts
3,896
-
-
Trade receivables
597
-
-
Appropriation receivable
5,898
-
-
Land and buildings
86
-
-
Property, plant and equipment
37,524
-
-
Intangibles
140
-
-
Prepayments
132
-
-
Total assets recognised
49,465
-
-
       
Liabilities recognised      
Suppliers
(303)
-
-
Other payables
(2,126)
-
-
Employee provisions
(5,439)
-
-
Other provisions
(33)
-
-
Total liabilities recognised
(7,901)
-
-
Net assets recognised 4
41,564
-
-
       
Income assumed      
Recognised by the Department of Regional Australia, Local Government, Arts and Sport 1
1,330
-
-
Total income assumed
1,330
-
-
       
Expenses assumed      
Recognised by the Department of Regional Australia, Local Government, Arts and Sport 1
7,187
-
-
Total expenses assumed
7,187
-
-
       
Functions relinquished      
Assets relinquished      
Trade receivables
-
-
414
Appropriation receivable
-
825
2,616
Work in progress
-
-
136
Property, plant and equipment
-
-
16
Intangibles
-
-
3,279
Total assets relinquished
-
825
6,461
       
Liabilities relinquished      
Income in advance
-
-
(123)
Employee provisions
-
(825)
(2,012)
Total liabilities relinquished
-
(825)
(2,135)
Net assets relinquished 5
-
-
4,326

1. In accordance with the Administrative Arrangement Orders of 18 September 2013, the Department assumed responsibility for the Arts and Cultural function from the Department of Regional Australia, Local Government, Arts and Sport (DRALGAS).

2. In accordance with the Administrative Arrangement Orders of 18 September 2013, Indigenous Programs and Functions were transferred to the Department of Prime Minister Cabinet (PM&C).

3. In accordance with the Administrative Arrangement Orders of 1 October 2012, the Office of Legislative Drafting and Publishing function was transferred to the Office of Parliamentary Counsel (OPC).

4. The net assets assumed from all entities were $41.564m (2012-13: nil).

5. The net assets relinquished to all entities were nil (2012-13: $4.326m).

Note 10B: Administered restructuring

 
2014
 
Arts and Cultural Development 1
 
$'000
Functions assumed
 
Assets recognised
 
Trade receivables and other receivables
2,536
Special account
500
Investments in associates
8,036,071
Land and buildings
43,798
Total assets recognised
8,082,905
 
 
Liabilities recognised
 
Suppliers
(4,238)
Total liabilities recognised
(4,238)
Net assets recognised 2
8,078,667
 
 
Income assumed
 
Recognised by the Department of Regional Australia, Local Government, Arts and Sport 1
208
Total income assumed
208
 
 
Expenses assumed
 
Recognised by the Department of Regional Australia, Local Government, Arts and Sport 1
254,221
Total expenses assumed
254,221

1. In accordance with the Administrative Arrangement Orders of 18 September 2013, the Department assumed responsibility for the Arts and Cultural function from the Department of Regional Australia, Local Government, Arts and Sport (DRALGAS).

2. The net assets assumed from all entities were $8,078.667m (2012-13: nil).

Note 11: Cash flow reconciliation

Reconciliation of cash and cash equivalents as per Statement of Financial Position to Cash Flow Statement
2014
2013
 
$'000
$'000
Cash and cash equivalents as per
 
 
Cash Flow Statement
4,394
1,794
Statement of Financial Position
4,394
1,794
Discrepancy
-
-
 
 
 
Reconciliation of net cost of services to net cash from operating activities
 
 
Net cost of services
(252,152)
(218,360)
Revenue from Government
230,399
198,397
 
 
 
Adjustments for non-cash items
 
 
Depreciation/amortisation
26,025
21,499
Impairment of financial instruments
20
19
Assets first recognised
(460)
-
Transfer of assets between Departmental and Administered
-
375
Write-down of property, plant and equipment
1,758
27
Decommissioning expenses
88
-
Onerous lease expenses
3,480
-
Unwinding of makegood
(217)
14
 
 
 
Movements in assets and liabilities
 
 
Assets
 
 
(Increase)/decrease in net receivables
(24,869)
23,757
(Increase)/decrease in prepayments
(1,026)
(651)
Liabilities
 
 
Increase/(decrease) in employee provisions
(960)
(658)
Increase/(decrease) in supplier payables
4,663
(16,707)
Increase/(decrease) in grant payables
80
-
Increase/(decrease) in other payables
4,920
(3,051)
Increase/(decrease) in other provisions
12,240
589
Net cash from operating activities
3,989
5,250

Note 12: Contingent assets and liabilities

 
Claims for
damages or costs

Total
 
2014
2013
2014
2013
 
$'000
$'000
$'000
$'000
Contingent assets
 
 
 
 
Balance from previous period
109
95
109
95
New contingent assets recognised
199
9
199
9
Re-measurement
(13)
119
(13)
119
Assets realised
(67)
(114)
(67)
(114)
Rights expired
4
-
4
-
Total contingent assets
232
109
232
109
 
 
 
 
 
Contingent liabilities
 
 
 
 
Balance from previous period
(215)
(468)
(215)
(468)
New contingent liabilities recognised
-
(215)
-
(215)
Re-measurement
(59)
108
(59)
108
Liabilities realised
-
360
-
360
Rights expired
90
-
90
-
Total contingent liabilities
(184)
(215)
(184)
(215)
Net contingent liabilities
48
(106)
48
(106)

Quantifiable contingencies

The Department estimates $184,000 of contingent liabilities in respect to claims for damages/costs (2013: $215,000). This amount represents an estimate of the Department's liability based on precedent in such cases. The Department is defending the claims.

The Department estimates $232,000 of contingent assets in respect of claims for damages/costs (2013: $109,000). This amount represents the Department's estimate of claims against persons/organisations based on ongoing cases. The estimate is based on precedent in such cases.

Unquantifiable contingent liabilities

The Department is party to a number of civil litigation matters arising out of its statutory duty to administer the laws for which it is responsible. As at the date of this report there are no matters where costs have been awarded against the Department.

Unquantifiable contingent assets

Conversely, the Department, like any other party to civil litigation may be entitled to recover costs arising out of such litigation if it is successful. There are no matters at the date of this report where the Department reasonably expects to have an award of costs in its favour.

Future compensation claims

The “Scheme for Compensation for Defective Administration” (CDDA) allows agencies to provide compensation to persons who have been adversely affected by their maladministration, but who have no legal means to seek redress, such as a legal claim. It is not possible to estimate the value of future CDDA claims. The value of claims paid under this scheme during the financial year is disclosed at Note 32.

Note 13: Senior executive remuneration

Note 13A: Senior executive remuneration expense for the reporting period 1, 2

 
2014
2013
 
$
$
Short-term employee benefits
 
 
Salary
(14,077,082)
(11,352,251)
Annual leave accrued
(506,542)
(348,729)
Other 3
(321,630)
(1,218,612)
Total short-term employee benefits
(14,905,254)
(12,919,592)
 
 
 
Post-employment benefits
 
 
Superannuation
(2,794,975)
(2,671,890)
Total post-employment benefits
(2,794,975)
(2,671,890)
 
 
 
Other long-term employee benefits
 
 
Long service leave
(331,790)
(131,579)
Total other long-term employee benefits
(331,790)
(131,579)
 
 
 
Termination benefits
(775,807)
(1,249,480)
Total senior executive remuneration expenses
(18,807,826)
(16,972,541)

1. Note 13A was prepared on an accrual basis.

2. Note 13A excludes acting arrangements and part-year services where total remuneration expensed as a senior executive was less than $195,000.

3. Other includes motor vehicle, other allowances and reportable fringe benefits.

Note 13B: Average annual reportable remuneration paid to substantive senior executives during the reporting period

Average annual reportable remuneration paid to substantive senior executives in 2014

Average annual reportable remuneration 1
Substantive
Senior
Executive
No.
Reportable salary 2
$
Contributed superannuation 3
$
Reportable allowances 4
$
Total reportable remuneration
$
Total reportable remuneration (including part-time arrangements)
 
 
 
 
 
less than $195,000
14
103,312
22,502
-
125,814
$195,000 to $224,999
5
179,489
36,904
-
216,393
$225,000 to $254,999
32
200,077
39,686
265
240,028
$255,000 to $284,999
5
223,017
43,804
-
266,821
$285,000 to $314,999
9
241,633
51,556
-
293,189
$315,000 to $344,999
4
276,112
50,060
-
326,172
$375,000 to $404,999
2
344,893
60,925
-
405,818
$675,000 to $704,999
1
671,582
25,000
-
696,582
 
 
 
 
 
 
Total number of substantive senior executives
72
 
 
 
 

Average annual reportable remuneration paid to substantive senior executives in 2013

Average annual reportable remuneration 1
Substantive
Senior
Executive
No.
Reportable salary 2
$
Contributed superannuation 3
$
Reportable allowances 4
$
Total reportable remuneration
$
Total reportable remuneration (including part-time arrangements)
 
 
 
 
 
less than $195,000
25
67,972
12,841
-
80,813
$195,000 to $224,999
18
180,806
37,472
-
218,278
$225,000 to $254,999
16
195,872
41,475
-
237,347
$255,000 to $284,999
8
223,500
47,953
-
271,453
$285,000 to $314,999
6
244,106
49,238
-
293,344
$315,000 to $344,999
4
252,003
79,068
-
331,071
$345,000 to $374,999
1
298,473
62,448
-
360,921
$375,000 to $404,999
1
287,405
98,674
-
386,079
$585,000 to $614,999
1
570,560
39,773
-
610,333
 
 
 
 
 
 
Total number of substantive senior executives
80
 
 
 
 

1. This table reports substantive senior executives who received remuneration during the reporting period. Each row is an averaged figure based on headcount for individuals in the band.

2. 'Reportable salary' includes the following:

  1. gross payments;
  2. reportable fringe benefits (at the net amount prior to 'grossing up' for tax purposes);
  3. exempt foreign employment income; and
  4. reportable employer superannuation contributions.

3. The 'contributed superannuation' amount is the average cost to the department for the provision of superannuation benefits to substantive senior executives in that reportable remuneration band during the reporting period.

4. 'Reportable allowances' are the average actual allowances paid as per the 'total allowances' line on individuals' payment summaries.

5. Various salary sacrifice arrangements were available to senior executives including superannuation, motor vehicle and expense payment fringe benefits. Salary sacrifice benefits are reported in the 'reportable salary' column.

6. Adjustments to 2012-13 comparatives were made to reflect the change in executive remuneration threshold (from $180,000 to $195,000).

Note 13C: Average annual reportable remuneration paid to other highly paid staff during the reporting period

Average annual reportable remuneration paid to other highly paid staff in 2014

Average annual reportable remuneration 1
Other Highly
Paid
Staff
No.
Reportable salary 2
$
Contributed superannuation 3
$
Reportable allowances 4
$
Total reportable remuneration
$
Total reportable remuneration (including part-time arrangements)
 
 
 
 
 
$195,000 to $224,999
9
181,769
28,490
22
210,281
$225,000 to $254,999
1
223,265
18,321
-
241,586
$255,000 to $284,999
3
245,161
27,252
-
272,413
$285,000 to $314,999
1
279,764
22,496
-
302,260
 
 
 
 
 
 
Total number of other highly paid staff
14
 
 
 
 

Average annual reportable remuneration paid to other highly paid staff in 2013

Average annual reportable remuneration 1
Other Highly
Paid
Staff
No.
Reportable salary 2
$
Contributed superannuation 3
$
Reportable allowances 4
$
Total reportable remuneration
$
Total remuneration (including part-time arrangements)
 
 
 
 
 
$195,000 to $224,999
4
186,456
26,252
-
212,708
$225,000 to $254,999
1
203,810
26,720
-
230,530
$255,000 to $284,999
3
247,458
23,656
-
271,114
$285,000 to $314,999
1
273,574
19,776
-
293,350
 
 
 
 
 
 
Total number of other highly paid staff
9
 
 
 
 

1. This table reports staff:

  1. who were employed by the Department during the reporting period and includes total reportable remuneration for staff acting at the SES level and for staff based overseas;
  2. whose reportable remuneration was $195,000 or more for the financial period; and
  3. were not required to be disclosed in Table B.

Each row is an averaged figure based on headcount for individuals in the band.

2. 'Reportable salary' includes the following:

  1. gross payments;
  2. reportable fringe benefits (at the net amount prior to 'grossing up' for tax purposes);
  3. exempt foreign employment income; and
  4. reportable employer superannuation contributions.

3. The 'contributed superannuation' amount is the average cost to the department for the provision of superannuation benefits to substantive senior executives in that reportable remuneration band during the reporting period.

4. 'Reportable allowances' are the average actual allowances paid as per the 'total allowances' line on individuals' payment summaries.

5. Adjustments to 2012-13 comparatives were made to reflect the change in executive remuneration threshold (from $180,000 to $195,000).

Note 14: Remuneration of auditors

 
2014
2013
 
$'000
$'000
Financial statement audit services were provided free of charge to the Department by the Australian National Audit Office (ANAO).
 
 
 
 
 
The fair value of services provided was
470
405

No other services were provided by the auditors of the financial statements.

Note 15: Financial instruments

15A: Categories of financial instruments

 
 
2014
2013
 
Notes
$'000
$'000
Financial assets  
 
 
 
 
 
Loans and receivables  
 
 
 
 
 
Cash and cash equivalents
6A
4,394
1,794
Goods and services receivable
6B
23,087
7,482
Total financial assets  
 
27,481
9,276
 
 
 
 
 
 
 
Financial liabilities  
 
 
 
 
 
Financial liabilities measured at amortised cost  
 
 
 
 
 
Trade creditors
8A
5,822
6,022
Accrued payables
8A
14,111
11,327
Operating lease rentals
8A
12,066
9,684
Total financial liabilities  
 
31,999
27,033

15B: Net gains or losses on financial assets

 
 
2014
2013
 
Notes
$'000
$'000
Loans and receivables  
 
 
 
 
 
Impairment
3E
(20)
(19)
Net (losses) from loans and receivables  
 
(20)
(19)

15C: Fair value of financial assets and liabilities

The Department considers that the carrying amounts of financial instruments reported in the balance sheet are a reasonable approximation of fair value.

15D: Credit risk

The Department 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 total amount of trade receivables of $23,087,198 in 2014 (2013: $7,482,592). The Department has assessed the risk of default on payment and has allocated $32,214 in 2014 (2013: $17,932) to an impairment allowance account. This amount has been determined following an assessment of invoices greater than 90 days past due.

The Department has policies and procedures that guide employees in debt recovery techniques that are to be applied.

The following table illustrates the Department's gross exposure to credit risk, excluding any collateral or credit enhancements.

 
 
2014
2013
 
Notes
$'000
$'000
Loans and receivables  
 
 
 
 
 
Cash and cash equivalents
6A
4,394
1,794
Trade receivables
6B
23,087
7,482
Total  
 
27,481
9,276

The Department holds no collateral to mitigate against credit risk.

Credit quality of financial instruments not past due or individually determined as impaired:

 
Not Past Due Nor Impaired 2014
Not Past
Due Nor Impaired
2013
Past due
or impaired
2014
Past due
or impaired
2013
 
$'000
$'000
$'000
$'000
Loans and receivables  
 
 
 
 
 
 
 
Cash and cash equivalents
4,394
1,794
-
-
Trade receivables
21,928
5,921
1,159
1,561
Total
26,322
7,715
1,159
1,561

Ageing of financial assets that were past due but not impaired for 2014:

 
0 to 30
days
$'000
31 to 60
days
$'000
61 to 90
days
$'000
90+
days
$'000
Total
$'000
Loans and receivables  
 
 
 
 
 
 
 
 
 
Trade receivables
700
147
59
221
1,127
Total
700
147
59
221
1,127

Ageing of financial assets that were past due but not impaired for 2013:

 
0 to 30
days
$'000
31 to 60
days
$'000
61 to 90
days
$'000
90+
days
$'000
Total
$'000
Loans and receivables  
 
 
 
 
 
 
 
 
 
Trade receivables
658
394
37
454
1,543
Total
658
394
37
454
1,543

15E: Liquidity risk

The Department's financial liabilities are trade creditors. The exposure to liquidity risk is based on the notion that the Department will encounter difficulty in meeting its obligations associated with financial liabilities.

his is highly unlikely due to appropriation funding and other funding mechanisms available to the Department (eg Advance to the Finance Minister) to ensure it has adequate funds to meet payments as they fall due. In addition, the Department has policies in place to ensure timely payments are made when due and has no past experience of default.

Maturities for non-derivative financial liabilities 2014

 
Notes
On
demand
2014
$'000
within
1 year
2014
$'000
1 to 5
years
2014
$'000
>5
years
2014
$'000
Total
2014
$'000
Financial liabilities at amortised cost  
 
 
 
 
 
 
 
 
 
 
 
Trade creditors
8A
-
5,822
-
-
5,822
Accrued payables
8A
-
14,111
-
-
14,111
Operating lease rentals
8A
-
12,066
-
-
12,066
Total  
 
-
31,999
-
-
31,999

Maturities for non-derivative financial liabilities 2013

 
Notes
On
demand
2013
$'000
within
1 year
2013
$'000
1 to 5
years
2013
$'000
>5
years
2013
$'000
Total
2013
$'000
Financial liabilities at amortised cost
 
 
 
 
 
 
Trade creditors
8A
-
6,022
-
-
6,022
Accrued payables
8A
-
11,327
-
-
11,327
Operating lease rentals
8A
-
9,684
-
-
9,684
Total  
 
-
27,033
-
-
27,033

15F: Market risk

The Department holds basic financial instruments that do not expose it to market risks. The Department is not exposed to 'Currency risk' or 'Other price risk'.

Interest rate risk

The only interest-bearing items on the Balance Sheet are finance leases. All bear interest at a fixed interest rate and will not fluctuate due to changes in the market interest rate.

Note 16: Financial assets reconciliation

 
2014
2013
 
'000
'000
Financial assets
 
 
 
 
 
Total financial assets as per statement of financial position
95,245
58,229
Less: non-financial instrument components
 
 
Appropriation receivable
66,246
47,889
GST receivable from the Australian Taxation Office
1,504
1,037
Other
46
45
Impairment allowance
(32)
(18)
Total non-financial instrument components
67,764
48,953
Total financial assets as per financial instruments note
27,481
9,276

Note 17: Administered - expenses 1

17A: Employee benefits

   
2014
2013
 
Notes
$'000
$'000
Wages and salaries  
21,469
5,088
Leave and other entitlements  
2,166
463
Superannuation  
 
 
Defined benefit plans  
41
36
Defined contribution plans  
2,208
623
Other employee benefits  
1,709
358
Total employee benefits  
27,593
6,568

17B: Suppliers

   
2014
2013
 
Notes
$'000
$'000
Goods and services supplied or rendered  
 
 
Consultants and contractors  
15,257
3,987
Training and equipment purchases  
1,742
8,333
Travel  
4,138
2,759
Information technology and communications  
12,195
3,396
Royalty payments 2  
21,217
-
Contribution to Family Court of Western Australia operations  
13,319
12,640
Family Law Act payments to States and Territories 3  
1,183
1,498
Legal fees  
15,250
1,824
General office 4  
19,995
6,987
Concessional loan discount  
9,522
-
Payments and contributions to external bodies  
7,888
2,496
Total goods and services supplied or rendered  
121,706
43,920
   
 
 
Goods supplied in connection with  
 
 
Related parties  
4
148
External parties  
6,446
5,445
Total goods supplied  
6,450
5,593
   
 
 
Services rendered in connection with  
 
 
Related parties  
14,519
9,647
External parties  
100,737
28,680
Total services rendered  
115,256
38,327
Total goods and services supplied or rendered  
121,706
43,920
   
 
 
Other suppliers  
 
 
Operating lease rentals in connection with  
 
 
External parties  
 
 
Minimum lease payments  
5,130
1,479
Total other suppliers  
5,130
1,479
Total suppliers  
126,836
45,399
   
 
 
Subsidies in connection with  
 
 
External parties  
 
 
Law Courts Limited  
3,296
2,458
Total subsidies  
3,296
2,458

17D: Personal benefits

   
2014
2013
 
Notes
$'000
$'000
 
 
 
Direct  
 
 
Australian Government Disaster Recovery Payments 5  
2,442
170,176
Australian Victims of Terror Overseas Payments  
27,234
-
Payments to victims of natural disasters 5  
572
5,175
High Court Justices (Long Leave Payments) Act 1979 6  
-
950
Judges (Long Leave Payments) Act 1979 7  
89
-
Former Solicitor Generals Pension - interest expense  
200
200
RCIRCSA witness expenses  
158
-
Federal Proceedings Cost Act 1981  
499
592
Total personal benefits  
31,194
177,093
   
 
 

17E: Grants 4

   
2014
2013
 
Notes
$'000
$'000
 
 
 
Public sector  
 
 
Australian Government entities (related entities)  
55,163
564
State and Territory Governments 3  
33,119
9,705
Local Governments  
16,006
11,597
Private sector  
 
 
Non-profit organisations  
156,420
147,893
Other private sector  
19,993
16,918
Overseas  
1,203
5,286
Other grants  
 
 
Family relationship support payments  
155,353
153,390
Other grants  
42,627
46,652
Total grants  
479,884
392,005
   
 
 

17F: Depreciation and amortisation

   
2014
2013
 
Notes
$'000
$'000
Depreciation  
 
 
Buildings  
3,200
-
Property, plant and equipment  
1,955
2,115
Total depreciation  
5,155
2,115
   
 
 
Amortisation  
 
 
Intangibles  
414
309
Total amortisation  
414
309
Total depreciation and amortisation  
5,569
2,424
   
 
 

17G: Write-down and impairment of assets

   
2014
2013
 
Notes
$'000
$'000
Impairment on financial instruments  
59
1,756
Impairment on personal benefit recoveries  
(1,050)
(822)
Total write-down and impairment of assets  
(991)
934
   
 
 

17H: Payments to CAC Act bodies 1

   
2014
2013
 
Notes
$'000
$'000
Australia Council  
128,786
-
Australian Film, Television and Radio School  
18,321
-
Australian National Maritime Museum  
12,016
-
National Film and Sound Archive  
1,260
-
National Gallery of Australia  
24,871
-
National Library of Australia  
45,067
-
National Museum of Australia  
27,853
-
National Portrait Gallery of Australia  
7,767
-
Screen Australia  
13,473
-
Total payments to CAC Act bodies  
279,414
-

1 As a result of 18 September 2013 administrative arrangements, the Department assumed responsibility for the Arts and Culture functions from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).

2 Payments under the Public Lending Rights/Educational Lending Rights (PLR/ELR) program.

3 During 2013-14 the Department reclassified payments made under the Family Law Act 1975 to State and Territories from 'grants to State and Territory Governments' to supplier expenses as these payments did not meet the definition of a grant. Comparatives have been restated accordingly.

4 During 2013-14 the Department reclassified grant payments funded from the Proceeds of Crime Act 2002 from supplier expenses to grants as these payments met the definition of a grant. Comparatives have been restated accordingly.

5 Payments made to individuals under the Australian Government Disaster Recovery Program, Disaster Income Recovery Allowance (DRA) Program and ex-gratia payments to New Zealand residents in Australia under the DIRS program in response to 2013-14 natural disaster events (eg Bushfires).

6 Long leave payments made to Justices of the High Court in 2012-13.

7 Long leave payments made to a Justice of the ACT Supreme Court in 2013-14.

Note 18: Administered - income

   
2014
2013
 
Notes
$'000
$'000
REVENUE  
 
 
   
 
 
Non-taxation revenue  
 
 
   
 
 

18A: Sale of goods and rendering of services

   
2014
2013
 
Notes
$'000
$'000
Rendering of services in connection with  
 
 
Related parties  
1,150
87
External parties  
5,076
5,625
Total sale of goods and rendering services  
6,226
5,712

18B: Interest

   
2014
2013
 
Notes
$'000
$'000
Loans - State and Territory Government  
1,626
2,020

18C: Dividends

   
2014
2013
 
Notes
$'000
$'000
Australian Government entities - Australian Government Solicitor  
4,723
9,000

18D: Competitive neutrality

   
2014
2013
 
Notes
$'000
$'000
Australian Government entities - Australian Government Solicitor  
3,997
4,711

18E: Recoveries 1

   
2014
2013
 
Notes
$'000
$'000
Personal benefit recoveries  
252
316

18F: Other non-taxation revenue

   
2014
2013
 
Notes
$'000
$'000
Recovery of unspent grant funding  
1,701
1,499
Torres Strait Regional Authority receipts  
800
816
Proceeds of Crime Act 2002 receipts  
5,305
3,339
Other revenue  
4,235
3,534
Total other revenue  
12,041
9,188
   
 
 

GAINS
18G: Other gains

   
2014
2013
 
Notes
$'000
$'000
Resources received free of charge - ACC  
118
-
   
 
 

1 The Department has an arrangement with the Department of Human Services (DHS) to provide claiming channels and claim processing arrangements in respect of disaster recovery payments. The amount of $0.252m (2013: $0.316m) represents the value of recovery action undertaken by DHS.

Note 19: Fair value measurements

The following tables provide an analysis of assets and liabilities that are measured at fair value.

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

Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the department can access at measurement date (30 June 2014).

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

Level 3: Unobservable inputs for the asset or liability.

19A: Fair value measurements

 
Non-financial assets
 
Buildings
Property, plant and equipment
Leasehold improvements
Total
 
2014
$'000
2014
$'000
2014
$'000
2014
$'000
Opening balance 1
-
2,312
7,200
9,512
Total gains/(losses) recognised in other comprehensive income 2
7,758
-
45
7,803
Purchases
1,685
6,767
9,577
18,029
Depreciation
(1,131)
(967)
(2,069)
(4,167)
Other movements 3
43,798
-
-
43,798
Closing balance
52,110
8,112
14,753
74,975
 
 
 
 
 
Changes in unrealised gains/(losses) recognised 4
7,758
-
45
7,803

1. Opening balance as determined in accordance with AASB 13.
2. These gain/(losses) are presented in the Statement of Comprehensive Income under Other Comprehensive Income.
3. As a result of 18 September 2013 Administrative arrangements, the Department assumed responsibility for the Arts and Culture function from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).
4. These unrealised gains/(losses) are presented in the Statement of Comprehensive Income under Other Comprehensive Income.

The Department's policy for determining when transfers between levels are deemed to have occurred can be found in Note 1.

Note 20: Administered - financial assets 1

20A: Cash and cash equivalents

 
 
2014
2013
 
Notes
$'000
$'000
Cash on hand or on deposit
 
4
1

20B: Loans and receivables

 
 
2014
2013
 
Notes
$'000
$'000
Goods and services receivables in connection with
 
 
 
Related parties
 
81
44
External parties
 
731
55
Total goods and services receivables
 
812
99
 
 
 
 
Advances and loans2
 
 
 
State and Territory Governments
 
118,627
30,321
Total advances and loans
 
118,627
30,321
 
 
 
 
Other receivables
 
 
 
Special account receivable from OPA
 
500
-
Other
 
560
490
Personal benefit recoveries 3
 
1,617
2,021
GST receivable from Australian Taxation Office
 
2,837
2,243
Total other receivables
 
5,514
4,754
Total loans and receivables (gross)
 
124,953
35,174
 
 
 
 
Less impairment allowance
 
 
 
Goods and services
 
(91)
-
Personal benefit recoveries
 
(646)
(1,697)
Total impairment allowance
 
(737)
(1,697)
Total trade and other receivables (net)
 
124,216
33,477
 
 
 
 
Trade and other receivables (net) expected to be recovered
 
 
 
No more than 12 months
 
124,216
33,477
Total trade and other receivables (net)
 
124,216
33,477
 
 
 
 
Trade and other receivables (gross) aged as follows
 
 
 
Not overdue
 
122,888
33,442
Overdue by
 
 
 
0 to 30 days
 
149
33
31 to 60 days
 
10
-
61 to 90 days
 
190
2
More than 90 days
 
1,716
1,697
Total trade and other receivables (gross)
 
124,953
35,174
 
 
 
 
Impairment allowance aged as follows
 
 
 
Overdue by
 
 
 
More than 90 days
 
(737)
(1,697)
Total impairment allowance
 
(737)
(1,697)

Credit terms were within 30 days (2013: 30 days).

1 As a result of 18 September 2013 administrative arrangements, the Department assumed responsibility for the Arts and Culture function from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).

2 Loans are made to State and Territory Governments for periods up to 100 years. No security is required. Principal will be repaid in full by maturity. Interest rates are either fixed or variable. Interest payments are made annually.

3 Recovery action undertaken by Department of Human Services in respect of payments made under the Australian Government Disaster Recovery Program and Disaster Income Recovery Subsidy.

Reconciliation of the Impairment Allowance
Movements in relation to 2014

 
Goods and services
Personal benefit
recoveries
Total
 
$'000
$'000
$'000
Opening balance
-
1,697
1,697
Amounts recovered and reversed
-
(1,051)
(1,051)
Amounts transferred under restructuring of administrative arrangements
32
-
32
Increase recognised in net cost of services
59
-
59
Closing balance
91
646
737
 
 
 
 
Movements in relation to 2013
 
 
 
Opening balance
-
2,521
2,521
Amounts recovered and reversed
-
(824)
(824)
Closing balance
-
1,697
1,697

20C: Investments

 
 
2014
2013
 
Notes
$'000
$'000
Investments in associates
 
 
 
Australian Business Arts Foundation
 
1,816
-
Australia Council
 
21,376
-
Australia Film, Television and Radio School
 
10,837
-
Australian Government Solicitor
 
36,058
38,697
Australian National Maritime Museum
 
254,248
-
Bundanon Trust
 
36,195
-
High Court of Australia
 
230,100
230,678
National Film and Sound Archive
 
269,694
-
National Gallery of Australia
 
5,187,325
-
National Library of Australia
 
1,823,857
-
National Museum of Australia
 
458,431
-
National Portrait Gallery
 
129,150
-
Screen Australia
 
67,645
-
Investments in jointly controlled entities
 
 
 
Law Courts Limited
 
115,200
111,101
Total investments
 
8,641,932
380,476
 
 
 
 
Investments expected to be recovered
 
 
 
More than 12 months
 
8,641,932
380,476
Total investments
 
8,641,932
380,476

Details of investments

 
Ownership
 
2014
2013
Name of entity
%
%
Jointly controlled entities
 
 
Law Courts Limited 1
47.5
47.5
Associates
 
 
Australian Business Arts Foundation
100
-
Australia Council
100
-
Australia Film, Television and Radio School
100
-
Australian Government Solicitor
100
100
Australian National Maritime Museum
100
-
Bundanon Trust
100
-
High Court of Australia
100
100
National Film and Sound Archive
100
-
National Gallery of Australia
100
-
National Library of Australia
100
-
National Museum of Australia
100
-
National Portrait Gallery
100
-
Screen Australia
100
-

1 The published fair value for the investment in Law Courts Limited is $115.200m (2013: $111.101m).

This note should be read in conjunction with Note 27.

20D: Other current assets

 
 
2014
2013
 
Notes
$'000
$'000
Assets forfeited under the Protection of Movable Cultural Heritage Act 1996 1
 
5,910
-
 
 
 
 
Other current assets expected to be recovered
 
 
 
No more than 12 months
 
5,910
-
Total other current assets
 
5,910
-

1 Items forfeited to the Commonwealth under subsection 14(1) of the Protection of Movable Cultural Heritage Act 1996.

Note 21: Administered - non-financial assets 1

21A: Land and buildings

 
 
>2014
2013
 
Notes
$'000
$'000
Buildings on freehold land
 
 
 
Fair value
 
52,110
-
 
 
 
 
Leasehold improvements
 
 
 
Fair value
 
8,850
-
Work in progress (at cost)
 
5,903
7,200
Total leasehold improvements
 
14,753
7,200
Total land and buildings
21C
66,863
7,200

No indicators of impairment were found for land and buildings.

No land or buildings are expected to be sold or disposed of within the next 12 months.

A revaluation of land and buildings was undertaken by an independent valuer with effect from 30 June 2014. A revaluation increment of $7,758,519 for buildings on freehold land (2013: nil movement) and a revaluation increment of $44,153 for leasehold improvements (2013: nil movement) were credited to the asset revaluation surplus by asset class and included in the equity section of the balance sheet.

21B: Property, plant and equipment

 
 
2014
2013
 
Notes
$'000
$'000
Other property, plant and equipment
 
 
 
Fair value
 
13,266
6,641
Accumulated depreciation
 
(4,213)
(2,261)
Total other property, plant and equipment
21C
9,053
4,380
Total property, plant and equipment
 
9,053
4,380

No indicators of impairment were found for property, plant and equipment.

No property, plant or equipment is expected to be sold or disposed of within the next 12 months.

1 As a result of 18 September 2013 administrative arrangements, the Department assumed responsibility for the Arts and Culture function from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).

Note 21C: Reconciliation of the opening and closing balances of property, plant and equipment for 2013-14

  Buildings Leasehold improvements Total land
and buildings
Other
property,
plant & equipment
Total
  $'000 $'000 $'000 $'000 $'000
As at 1 July 2013          
Gross book value - 7,200 7,200 6,641 13,841
Accumulated depreciation and impairment - - - (2,261) (2,261)
Adjustments made to gross value - - - 2 2
Total as at 1 July 2013 - 7,200 7,200 4,382 11,582
           
Additions          
By purchase 1,685 9,577 11,262 6,626 17,888
Revaluation and impairments recognised through other comprehensive income 7,758 45 7,803 - 7,803
Depreciation expense (1,131) (2,069) (3,200) (1,955) (5,155)
Other movements: assets transferred from Department of Regional Australia, Local Government, Arts and Sport 1 43,798 - 43,798 - 43,798
Total as at 30 June 2014 52,110 14,753 66,863 9,053 75,916
           
Total as at 30 June 2014 represented by          
Gross book value 52,110 14,753 66,863 13,266 80,129
Accumulated depreciation and impairment - - - (4,213) (4,213)
Total as at 30 June 2014 52,110 14,753 66,863 9,053 75,916

1 As a result of 18 September 2013 administrative arrangements, the Department assumed responsibility for the Arts and Culture function from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).

Reconciliation of the opening and closing balances of property, plant and equipment for 2012-13

  Buildings Leasehold improvements Total land
and buildings
Other
property,
plant & equipment
Total
  $'000 $'000 $'000 $'000 $'000
As at 1 July 2012
 
 
 
 
 
Gross book value
-
-
-
5,417
5,417
Accumulated depreciation and impairment
-
-
-
(146)
(146)
Total as at 1 July 2012
-
-
-
5,271
5,271
 
 
 
 
 
 
Additions
 
 
 
 
 
By purchase
-
7,200
7,200
1,224
8,424
Depreciation expense
-
-
-
(2,115)
(2,115)
Total as at 30 June 2013
-
7,200
7,200
4,380
11,580
 
 
 
 
 
 
Total as at 30 June 2013 represented by
 
 
 
 
 
Gross book value
-
7,200
7,200
6,641
13,841
Accumulated depreciation and impairment
-
-
-
(2,261)
(2,261)
Total as at 30 June 2013
-
7,200
7,200
4,380
11,580

21D: Intangibles

 
 
2014
2013
 
Notes
$'000
$'000
Computer software
 
 
Internally developed - in use
544
287
Purchased
3,160
1,318
Accumulated amortisation
(1,459)
(1,045)
Total intangibles
21E
2,245
560

No indicators of impairment were found for intangible assets.

No intangibles are expected to be sold or disposed of within the next 12 months.

Note 21E: Reconciliation of the opening and closing balances of intangibles for 2013-14

 
Computer
software
internally
developed
Computer
software
purchased
Total
 
$'000
$'000
$'000
As at 1 July 2013
 
 
 
Gross book value
287
1,318
1,605
Accumulated amortisation and impairment
(86)
(959)
(1,045)
Total as at 1 July 2013
201
359
560
 
 
 
 
Additions
 
 
 
By purchase
-
1,842
1,842
Internally developed
257
-
257
Amortisation
(61)
(353)
(414)
Total as at 30 June 2014
397
1,848
2,245
 
 
 
 
Total as at 30 June 2014 represented by
 
 
 
Gross book value
544
3,160
3,704
Accumulated amortisation and impairment
(147)
(1,312)
(1,459)
Total as at 30 June 2014
397
1,848
2,245

Reconciliation of the opening and closing balances of intangibles for 2012-13

 
Computer
software
internally
developed
Computer
software
purchased
Total
 
$'000
$'000
$'000
As at 1 July 2012
 
 
 
Gross book value
676
1,318
1,994
Accumulated amortisation and impairment
(418)
(707)
(1,125)
Total as at 1 July 2012
258
611
869
 
 
 
 
Amortisation
(57)
(252)
(309)
Total as at 30 June 2013
201
359
560
 
 
 
 
Total as at 30 June 2013 represented by
 
 
 
Gross book value
287
1,318
1,605
Accumulated amortisation and impairment
(86)
(959)
(1,045)
Total as at 30 June 2013
201
359
560

21F: Other non-financial assets

 
 
2014
2013
 
Notes
$'000
$'000
Prepayments  
1,649
354

No indicators of impairment were found for other non-financial assets.

 
2014
2013
 
Notes
$'000
$'000
Other non-financial assets expected to be recovered
No more than 12 months  
485
185
More than 12 months  
1,164
169
Total other non-financial assets  
1,649
354

Note 22: Administered - payables

22A: Suppliers

 
 
2014
2013
 
Notes
$'000
$'000
Trade creditors
6,324
3,853
Accrued payables
13,769
3,561
Operating lease rentals
171
-
Total suppliers
20,264
7,414
   
 
 
Suppliers expected to be settled within 12 months
 
Related parties
1,042
671
External parties
19,222
6,743
Total suppliers
20,264
7,414

Settlement is usually net 30 days.

22B: Grants

 
 
2014
2013
 
Notes
$'000
$'000
Public sector
 
 
State and Territory Governments
 
2,892
1,000
Local Governments
636
2,024
Private sector
 
 
Non-profit organisations
7,801
3,504
Overseas  
50
-
Other  
2,045
2,715
Total grants and subsidies
13,424
9,243
   
 
 
Grants and subsidies expected to be settled
No more than 12 months
13,424
9,243
Total grants and subsidies
13,424
9,243

Settlement is usually made according to the terms and conditions of each grant. This is usually within 30 days of performance or eligibility.

22C: Other payables

 
 
2014
2013
 
Notes
$'000
$'000
Unearned income
600
595
Superannuation
83
-
Other  
6
-
Total other payables
689
595
   
 
 
Other payables expected to be settled
 
No more than 12 months
689
595
Total other payables
689
595

Note 23: Administered - provisions

23A: Employee provisions

 
 
2014
2013
 
Notes
$'000
$'000
Leave  
771
-
   
 
 
Employee provisions expected to be settled
 
No more than 12 months
412
-
More than 12 months
359
-
Total employee provisions
771
-

23B: Superannuation provision - former Solicitor-General pension

 
 
2014
2013
 
Notes
$'000
$'000
Present value of defined benefit obligations at end of the year
 
5,800
5,703
   
 
 
Personal benefits provisions expected to be settled
No more than 12 months
400
400
More than 12 months
5,400
5,303
Total personal benefits
5,800
5,703

Accounting policy

Actuarial gains and losses are recognised immediately in administered equity in the year in which they occur.

Scheme information

Pension payments to former Solicitors-General are made under the Judges' Pension Scheme. The Judges' Pension Scheme is a defined benefit scheme. It provides 60% of the appropriate current judicial salary for eligible retired judges. The scheme is unfunded. Members do not contribute towards the cost of benefits.

Benefits payable (including payments of surcharge debt) under the Judges' Pension Act 1968 and the Superannuation (Productivity Benefit) Act 1988 are paid from Consolidated Revenue on an emerging (or pay as go) basis. Thus contributions made equal benefits paid for the Judges' Pension Scheme (including former Solicitor-General's Pensions).

Reconciliation of the present value of the defined benefit obligation

 
 
2014
2013
 
Notes
$'000
$'000
Net liability at 1 July  
(5,703)
(7,007)
Interest cost  
(200)
(200)
Actuarial gains/(losses):
experience
(200)
-
changes in financial assumptions
(110)
1,100
Benefits paid  
413
404
Net liability at 30 June  
(5,800)
(5,703)

Reconciliation of the fair value of scheme assets

 
 
2014
2013
 
Notes
$'000
$'000
Opening fair value of scheme assets
-
-
Employer contributions 1  
(413)
(404)
Benefits paid  
413
404
Closing fair value of scheme assets
-
-

1 Employer contributions include appropriations from the Consolidated Revenue Fund.

Reconciliation of the net surplus/(deficit) to recognised assets and liabilities in the schedule of assets and liabilities administered on behalf of Government

As at
30 June
2014
$'000
30 June
2013
$'000
Defined benefit obligation
5,800
5,703
Net superannuation liability
5,800
5,703

Total expense recognised in the schedule of comprehensive income administered on behalf of Government

For the period ended
30 June
2014
$'000
30 June
2013
$'000
Interest cost
200
200
Net superannuation expense
200
200

Amounts recognised directly in administered equity

For the period ended
30 June
2014
$'000
30 June
2013
$'000
Actuarial gains/(losses)
(310)
1,100

Cumulative amount of actuarial gains and losses recognised in administered equity

For the period ended
30 June
2014
$'000
30 June
2013
$'000
Cumulative amount of actuarial gains
(1,300)
(1,000)

Scheme assets

The scheme is an unfunded arrangement with no assets.

Expected rate of return on scheme assets

The expected return on assets assumption is not relevant as the scheme is an unfunded arrangement with no assets.

Principal actuarial assumptions at the balance sheet date (expressed as weighted averages):

For the period ended
30 June
2014
$'000
30 June
2013
$'000
Discount rate
4.10%
4.30%
Expected salary increase rate
4.00%
4.00%
Expected pension increase rate
4.00%
4.00%

Other material assumptions

The demographic assumptions used as at 30 June 2014 are those used for the preparation of the Long Term Cost Report for the Judges' Pension Scheme as at 30 June 2011. The demographic assumptions used as at 30 June 2011 are those used for the preparation of the Long Term Cost Report for the Judges' Pension Scheme as at 30 June 2011.

Historical information

For the period ended
30 June
2014
$'000
30 June
2013
$'000
30 June
2012
$'000
Present value of defined benefit obligation
5,800
5,703
7,007
Surplus/(deficit) in scheme
5,800
5,703
7,007
Experience adjustments gain/(loss) - scheme liabilities
(310)
1,100
(1,900)

The expected employer contributions in respect of 2014-15 are $400,000.

Funding arrangements for employer contributions

Contribution recommendations

The Scheme is unfunded. The defined benefits are not funded in advance.

Funding method

Where a benefit in the Scheme becomes payable, the Australian Government assumes responsibility for the payment from the Consolidated Revenue Fund.

Economic assumptions

The long-term economic assumptions adopted for the last actuarial review of the scheme as at 30 June 2011 were

Expected rate of return on assets (discount rate)
4.3%
 
Expected salary increase rate
4.0%
+ a promotional salary increase scale
Expected pension increase
4.0%
 

Sensitivity analysis

A sensitivity analysis was requested whereby the sensitivity for salary related items was +/- 1.0 percentage points and the interest sensitivity was +/- 0.6 percentage points. Pensions are linked to the movements in the salaries paid to Judges. The results are not sensitive to changes in assumed CPI increases. The sensitivity analysis results are set out below:

Defined benefit obligation
Reported
$5.8m
Interest rate (-0.6%)
$6.2m
Interest rate (+0.6%)
$5.5m
Pension increases (+1.0%)
$6.4m
Pension increases (-1.0%)
$5.3m

The interest rate and probability weighted mean term of the liabilities is 10.3 years.

Nature of asset/liability

The Department has recognised a liability in the Schedule of Administered Assets and Liabilities in respect of its defined benefit superannuation arrangements administered on behalf of the Government. The former Solicitor-General's Pension Scheme does not impose a legal liability on the Department to cover any deficit that exists in the scheme.

The liability instead rests with the Australian Government. The Government has established the Future Fund for the purpose of accumulating assets to help meet this liability. The Future Fund is also intended to cover other superannuation unfunded liabilities including in relation to military schemes, Commonwealth public servants and Governors-General.

Note 24: Administered - cash flow reconciliation

Reconciliation of cash and cash equivalents as per Administered Schedule of Assets and Liabilities to Administered Cash Flow Statement

Cash and cash equivalents as per

 
 
2014
2013
 
Notes
$'000
$'000
Schedule of administered cash flows  
4
1
Schedule of administered assets and liabilities  
4
1
Discrepancy  
-
-

Reconciliation of net cost of services to net cash from operating activities

 
 
2014
2013
 
Notes
$'000
$'000
Net cost of services  
(923,812)
(595,934)
   
 
 
Adjustments for non-cash items
Depreciation/amortisation  
5,569
2,424
Impairment of financial instruments  
(991)
-
Net write down of non-financial assets  
-
1,756
Concessional loan discount  
9,522
-
Actuarial gain/(loss) - former Solicitor-General pension  
(310)
1,100
 
Movements in assets and liabilities
Assets
(Increase)/decrease in net receivables  
522
2,011
(Increase)/decrease in prepayments  
(1,295)
2,922
Liabilities
Increase/(decrease) in employee provisions  
771
-
Increase/(decrease) in supplier payables  
8,708
2,164
Increase/(decrease) in grant payables  
4,181
3,152
Increase/(decrease) in other payables  
94
(154)
Net cash from operating activities  
(897,041)
(580,559)

Note 25: Administered - contingent assets and liabilities

Unquantifiable administered contingencies

Natural Disaster Relief and Recovery Arrangements (NDRRA)

Under the NDRRA, the Commonwealth provides States and Territories a scheme of loans assistance at a concessional interest rate to eligible small businesses and primary producers whose assets have been significantly damaged as a direct result of a natural disaster.

At balance date the Department is unable to reliably estimate the future value of these potential claims, and no provision for these claims has been recognised in the Administered financial statements.

Future compensation claims

The "Scheme for Compensation for Defective Administration" (CDDA) allows agencies to provide compensation to person who have been adversely affected their maladministration, but who have no legal means to seek redress, such as a legal claim. It is not possible to estimate the value of future CDDA claims. The value of claims paid under this scheme during the financial year is disclosed at Note 32.

Note 26: Administered - impact of Royal Commissions on the 2013-14 administered financial statements 1

26A: Impact of Royal Commissions on the 2013-14 administered schedule of comprehensive income

 
Administered (excluding Royal Commissions)
Royal Commissions
 
 
RCIRCSA
RCHIP
RCTUGC
Total
 
$'000
$'000
$'000
$'000
$'000
 
 
 
 
 
 
EXPENSES
 
 
 
 
 
Employee benefits
1,067
23,440
1,754
1,332
27,593
Suppliers
76,043
41,945
5,013
3,835
126,836
Subsidies
3,296
-
-
-
3,296
Personal benefits
31,173
21
-
-
31,194
Grants
479,884
-
-
-
479,884
Depreciation and amortisation
2,928
2,528
-
113
5,569
Write-down and impairment of assets
(991)
-
-
-
(991)
Payments to CAC bodies
279,414
-
-
-
279,414
Total expenses administered on behalf of Government
872,814
67,934
6,767
5,280
952,795
 
 
 
 
 
 
LESS:
 
 
 
 
 
INCOME
 
 
 
 
 
Own-source revenue
 
 
 
 
 
Non-taxation revenue
 
 
 
 
 
Sale of goods and rendering of services
6,226
-
-
-
6,226
Interest
1,626
-
-
-
1,626
Dividends
4,723
-
-
-
4,723
Competitive neutrality
3,997
-
-
-
3,997
Recoveries
252
-
-
-
252
Other non-taxation revenue
12,041
-
-
-
12,041
Other gains
-
118
-
-
118
Changes in asset revaluation surplus
239,054
44
-
-
239,098
Remeasurement on defined benefit plans - former Solicitor-General pension
(310)
-
-
-
(310)
Total income
276,609
162
-
-
267,771

1 At 30 June 2014 the Department is responsible for the maintaining the ongoing operations of the following Royal Commissions:

*Royal Commission into Institutional Responses to Child Sexual Abuse (RCIRCSA);
*Royal Commission into the Home Insulation Program (RCHIP); and
*Royal Commission into Trade Union Governance and Corruption (RCTUGC).

26B: Impact of Royal Commissions on the 2013-14 administered schedule of assets and liabilities

 
Administered (excluding Royal Commissions)
Royal Commissions
 
 
RCIRCSA
RCHIP
RCTUGC
Total
 
$'000
$'000
$'000
$'000
$'000
ASSETS
 
 
 
 
 
Financial assets
 
 
 
 
 
Cash and cash equivalents
-
3
-
1
4
Loans and receivables
124,182
31
1
2
124,216
Investments
8,641,932
-
-
-
8,641,932
Other current assets
5,910
-
-
-
5,910
Total financial assets
8,772,024
34
1
3
8,772,062
 
 
 
 
 
 
Non-financial assets
 
 
 
 
 
Land and buildings
58,057
7,980
-
826
66,863
Property, plant and equipment
4,019
4,975
-
59
9,053
Intangibles
626
1,619
-
-
2,245
Other non-financial assets
429
977
5
238
1,649
Total non-financial assets
63,131
15,551
5
1,123
79,810
Total assets administered on behalf of Government
8,835,155
15,585
6
1,126
8,851,872
 
 
 
 
 
 
LIABILITIES
 
 
 
 
 
Payables
 
 
 
 
 
Suppliers
5,454
12,327
664
1,819
20,264
Grants
13,424
-
-
-
13,424
Other payables
606
83
-
-
689
Total payables
19,484
12,410
664
1,819
34,377
 
 
 
 
 
 
Provisions
 
 
 
 
 
Employee provisions
-
771
-
-
771
Superannuation provisions - former Solicitor-General pension
5,800
-
-
-
5,800
Total provisions
5,800
771
-
-
6,571
Total liabilities administered on behalf of Government
25,284
13,181
664
1,819
40,948
Net assets
8,809,871
2,404
(658)
(693)
8,810,924

At 30 June 2014 the Department is responsible for the maintaining the ongoing operations of the following Royal Commissions:

*Royal Commission into Institutional Responses to Child Sexual Abuse (RCIRCSA);
*Royal Commission into the Home Insulation Program (RCHIP); and
*Royal Commission into Trade Union Governance and Corruption (RCTUGC).

Note 27: Administered investments

The Australian Government owns 100% of the following entities:
*Australian Business Arts Foundation Limited
*Australian Council - s46(1) of the Australia Council Act 2013
*Australian Film, Television and Radio School - s36(1) of the Australian Film, Television and Radio School Act 1973
*Australian Government Solicitor - s55M of the Judiciary Act 1903
*Australian National Maritime Museum - s43(1) of the Australian National Maritime Museum Act 1990
*Bundanon Trust
*High Court of Australia - s17 of the High Court of Australia Act 1996
*National Film and Sound Archive - s37(1) of the National Film and Sound Archive Act 2008
*National Gallery of Australia - s34(1) of the National Gallery Act 1975
*National Library of Australia - s20(1) of the National Library Act 1960
*National Museum of Australia - s33(1) of the National Museum of Australia Act 1980
*National Portrait Gallery of Australia - s6(1) of the National Portrait Gallery of Australia Act 2012
*Screen Australia - s39(1) of the Screen Australia Act 2008

The Australian Government has joint ownership in the following entity:

Law Courts Ltd is a company limited by guarantee and is jointly controlled by the Australian and NSW Governments. The primary purpose of the company is to provide a courts facility being the joint Sydney Law Courts Building. The building works were largely completed in 2013-14. The investment taken up by the Australian Government is based on the net assets of Law Courts Ltd, adjusted by the accumulated capital contributions made by the Australian Government to the company up to 30 June 2014.

The principal activities of each of the Department's administered investments are:
* Law Courts Limited is a jointly controlled Australian Government/New South Wales company limited by guarantee established to manage the Sydney Law Courts Building.
* The Australian Business Arts Foundation Limited drives private giving, social investment and philanthropy for the arts in Australia. It also encourages sponsorship and corporate support, and builds partnerships between artists, business, private donors and the community to support the arts.
* The Australia Council is a Commonwealth authority responsible for the creation, presentation and appreciation of distinctive cultural works by providing assistance to Australian artists and making their works accessible to the public. The council is the Australian Government's principal arts funding and advisory body.
* The Australian Film, Television and Radio School is a Commonwealth authority responsible for the education and development of creative talent for the screen arts and broadcast industries. The school aims to provide a more sustainable screen broadcasting industry through advanced industry-focused education and training for talented students, professionals and organisations.
* The Australian Government Solicitor is a Commonwealth authority providing national legal services to the Government and its agencies in a contestable environment.
* The Australian National Maritime Museum is a Commonwealth authority and statutory agency responsible for increasing knowledge, appreciation and enjoyment of Australia's maritime heritage by managing the National Maritime Collection and staging programs, exhibitions and events.
* The Bundanon Trust is a Commonwealth company and supports arts practice and an understanding of the arts through its residency, education, exhibition and performance programs.
* The High Court, as the highest court in Australian judicial system, interprets and applies the law of Australia, decides cases of special Commonwealth significance including challenges to the constitutional validity of laws, and hears appeals from Federal, State and Territory Governments.
* The National Film and Sound Archive of Australia is a Commonwealth authority and statutory agency responsible for increasing understanding and appreciation of Australia's audiovisual history by developing, preserving, maintaining and promoting the national audiovisual collection and providing access to audiovisual material of historic and cultural significance.
* The National Gallery of Australia is a Commonwealth authority and statutory agency. It is responsible for increasing understanding, knowledge, and enjoyment of the visual arts by providing access to, and information about, works of art locally, nationally and internationally.
* The National Library of Australia is a Commonwealth authority and statutory agency. It is responsible for enhanced learning, knowledge creation, enjoyment and understanding of Australian life and society by providing access to a national collection of library material. The Library's role is to ensure that documentary resources of national significance relating to Australia, as well as significant non-Australian library materials are collected, preserved and made accessible.
* The National Museum of Australia is a Commonwealth authority and statutory agency. Its role is to research Australian history, develop and maintain a national collection of historical material, create exhibitions and programs which explore Australia's heritage and history and make it more accessible to Australians.
* The National Portrait Gallery of Australia is a Commonwealth authority and statutory agency. Its role is to develop, preserve, maintain, promote and provide access to a national collection consisting of portraits, other works of art and related material. It is also responsible for developing and engaging a national audience in relation to that collection through exhibitions, education, research, publications and public and online programs.
*Screen Australia is a Commonwealth authority and statutory agency. It is responsible for promoting a creative, innovative and commercially sustainable screen industry through the development, funding, promotion and facilitation of access to Australian screen products.

Note 28: Administered - financial instruments

28A: Categories of financial instruments

   
2014
2013
 
Notes
$'000
$'000
Financial assets  
 
 
Loans and receivables
 
 
 
Cash and cash equivalents
20A
4
1
Trade receivables
20B
812
99
Loans
20B
118,627
30,321
Other receivables
20B
560
490
Personal benefit recoveries
20B
1,617
2,021
Available for sale  
 
 
Investments
20C
8,641,932
380,476
Total financial assets  
8,763,552
413,408
     
 
Financial liabilities  
 
 
Financial liabilities measured at amortised cost  
 
 
Trade creditors
22A
6,324
3,853
Accrued payables
22A
13,769
3,561
Operating lease rentals
22A
171
-
Grants and subsidies payable
22B
13,424
9,243
Total financial liabilities  
33,688
16,657

28B: Net gains or losses on financial assets

   
2014
2013
 
Notes
$'000
$'000
Loans and receivables
 
 
 
Interest revenue
18B
1,626
2,020
Impairment on financial instruments
17G
(59)
1,756
Impairment of personal benefit recoveries
17G
1,050
822
Net gains/(losses) on loans and receivables  
2,617
4,598
     
 
Available-for-sale financial assets
 
 
 
Dividend revenue
18C
4,723
9,000
Net gains on available-for-sale financial assets
4,723
 
9,000
     
 
Net gains on financial assets
7,340
 
13,598

28C: Fair value of financial assets

The Department considers that the carrying amounts of financial instruments reported in the balance sheet are a reasonable approximation of fair value.

28D: Credit risk

The Administered activities of the Department are exposed to minimal credit risk as the majority of financial assets are trade receivables, advances and loans to State and Territory Governments, and shares in associated and Government controlled entities. The maximum exposure to credit risk is the risk that arises from potential default of a debtor. This amount is equal to the total amount of receivables $121,616,563 (2013: $32,930,448). The Department has assessed the risk of default on payment and has allocated $737,442 (2013: $1,697,490) to an impairment allowance account. This amount has been determined following an assessment of invoices greater than 90 days.

The Department has policies and procedures that guide employees on debt recovery techniques that are to be applied.

The following table illustrates the Department's gross exposure to credit risk. The Department holds no collateral to mitigate credit risk.

   
2014
2013
 
Notes
$'000
$'000
Loans and receivables
 
 
 
Cash and cash equivalents
20A
4
1
Trade receivables
20B
812
99
Loans
20B
118,627
30,321
Other receivables
20B
560
490
Personal benefit recoveries
20B
1,617
2,021
Available for sale
 
 
 
Investments
20C
8,641,932
380,476
Total  
8,763,552
413,408

Credit quality of financial instruments not past due or individually determined as impaired

 
Not Past
Due Nor
Impaired
2014
$'000
Not Past
Due Nor
Impaired
2013
$'000
Past due
or
impaired
2014
$'000
Past due
or
impaired
2013
$'000
Loans and receivables
 
 
 
 
Cash and cash equivalents
4
1
-
-
Trade receivables
364
64
448
35
Loans
118,627
30,321
-
-
Other receivables
560
490
-
-
Personal benefit recoveries
-
-
1,617
2,021
Available for sale
 
 
 
 
Investments
8,641,932
380,476
-
-
Total
8,761,487
411,352
2,065
2,056

Ageing of financial assets that are past due but not impaired for 2014

 
0 to 30
days
$'000
31 to 60
days
$'000
61 to 90
days
$'000
90+
days
$'000
Total
$'000
Loans and receivables
 
 
 
 
 
Trade receivables
149
10
190
8
357
Personal benefit recoveries
-
-
-
971
971
Total
149
10
190
979
1,328

Ageing of financial assets that are past due but not impaired for 2013

 
0 to 30
days
$'000
31 to 60
days
$'000
61 to 90
days
$'000
90+
days
$'000
Total
$'000
Loans and receivables
 
 
 
 
 
Trade receivables
33
-
2
-
35
Personal benefit recoveries
-
-
-
324
324
Total
33
-
2
324
359

Trade receivables have been individually assessed for impairment by departmental officers. Recovery of debt has been considered based on communication with the debtor, and where determined to be unrecoverable an allowance was recognised.

28E: Liquidity risk

The Department's financial liabilities are trade creditors, grants and subsidies payable. The exposure to liquidity risk is based on the notion that the Department will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to appropriation funding and mechanisms available to the Department (eg Advance to the Finance Minister) and internal policies and procedures put in place to ensure there are appropriate resources to meet its financial obligations.

The Department receives appropriations and manages its funds to ensure it is able to meet its financial obligations as they fall due. The Department also has policies in place to ensure timely payment of invoices and has no past history of default.

Maturities for non-derivative financial liabilities 2014

 
Notes
On
demand
2014
$'000
within
1 year
2014
$'000
1 to 5
years
2014
$'000
>5
years
2014
$'000
Total
2014
$'000
Liabilities at amortised cost
 
 
 
 
 
 
Trade creditors
22A
-
6,324
-
-
6,324
Accrued payables
22A
-
13,769
-
-
13,769
Operating lease rentals
22A
-
171
-
-
171
Grants and subsidies payable
22B
-
13,424
-
-
13,424
Total   -
33,688
-
-
33,688

Maturities for non-derivative financial liabilities 2013

 
Notes
On
demand
2014
$'000
within
1 year
2014
$'000
1 to 5
years
2014
$'000
>5
years
2014
$'000
Total
2014
$'000
Liabilities at amortised cost
 
 
 
 
 
 
Trade creditors
22A
-
3,853
-
-
3,853
Accrued payables
22A
-
3,561
-
-
3,561
Grants and subsidies payable
22B
-
9,243
-
-
9,243
Total  
-
16,657
-
-
16,657

28F: Market risk

The Department holds basic financial instruments that do not expose the Department to market risks. The Department is also not exposed to 'currency risk' or 'other price risk'.

Interest rate risk

The only interest-bearing items on the schedule of assets administered on behalf of Government are loans made to State and Territory Governments. All those bearing interest are at a fixed interest rate that does not fluctuate due to changes in the market interest rate. Those with variable interest rates are significantly concessional so that any movement in the market rate will not have a material impact on the carrying amount of the receivable.

28G: Concessional loans

 
2014
2013
 
$'000
$'000
Natural Disaster Relief and Recovery Arrangements
 
 
Nominal value
138,267
40,603
Less: Unexpired discount
(11,304)
(2,855)
Principal repayment
(8,336)
(7,427)
Carrying amount
118,627
30,321
   
 
Total Natural Disaster Relief and Recovery Arrangements
118,627
30,321

Note 29: Administered financial assets reconciliation

 
2014
2013
 
$'000
$'000
Financial assets
 
 
 
 
 
Total financial assets as per schedule of administered assets and liabilities
8,772,062
413,954
Less: non-financial instrument components
 
 
GST receivable from the Australian Taxation Office
2,837
2,243
Other
500
-
Impairment allowance
(737)
(1,697)
Total non-financial instrument components
2,600
546
Total financial assets as per administered financial instruments note
8,769,462
413,408

Note 30: Appropriations

Table A: Annual appropriations ('recoverable GST exclusive')

 
2014 Appropriations
 
 
 
Appropriation Act
FMA Act
 
 
 
 
Annual Appropriation
Appropriations reduced (1)
AFM
Section 30
Section 31
Section 32 (2)
Total appropriation
Appropriation applied in 2014 (current and prior years)
Variance (3)
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
DEPARTMENTAL
 
 
 
 
 
 
 
 
 
Ordinary annual services
239,369
-
-
-
89,689
-
329,058
318,629
10,429
Other services
 
 
 
 
 
 
 
 
 
Equity
6,920
-
-
-
 
-
6,920
2,064
4,856
Total departmental
246,289
-
-
-
89,689
-
335,978
320,693
15,285
ADMINISTERED
 
 
 
 
 
 
 
 
 
Ordinary annual services
 
 
 
 
 
 
 
 
 
Administered items - Outcome 1
532,730
(39,513)
-
442
 
-
493,659
472,389
21,270
Administered items - Outcome 2
914
(392)
-
1,244
 
132,701
134,467
133,632
835
Payments to CAC Act bodies
-
-
-
-
 
270,813
270,813
270,813
-
Other services
 
 
 
 
 
 
 
 
 
States, ACT, NT and Local Governments
5,000
-
-
-
 
-
5,000
5,079
(79)
Administered assets and liabilities
129,447
-
-
-
 
-
129,447
120,386
9,061
Payments to CAC Act bodies
-
-
-
-
 
8,601
8,601
8,601
-
Total administered
668,091
(39,905)
-
1,686
 
412,115
1,041,987
1,010,900
31,087

Notes:

(1) Appropriations reduced under Appropriation Acts (No 1 & 3) 2013-14: sections 10,11, 12 and 15 and under Appropriation Acts (No 2 & 4 ) 2013-14: sections 12, 13, 14 and 17. (Refer Note 30F).

(2) As a result of 18 September 2013 Administrative arrangements, the Department assumed responsibility for the Arts and Culture functions from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10B refers).

(3) The variances reflect drawdowns of prior year appropriation and timing differences between expenses and cash outflows.

The Australian Government continues to have regard to developments in case law, including the High Court's most recent decision on Commonwealth expenditure in Williams v Commonwealth [2014] HCA 23, as they contribute to the larger body of law relevant to the development of Commonwealth programs. In accordance with its general practice, the Government will continue to monitor and assess risk and decide on any appropriate actions to respond to risks of expenditure not being consistent with constitutional or other legal requirements.

   
Appropriation Act
 
FMA Act
 
 
 
 
Annual Appropriation
Appropriations reduced (1)
AFM
Section 30
Section 31
Section 32
Total appropriation
Appropriation applied in 2013 (current and prior years)
Variance (2)
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
DEPARTMENTAL
 
 
 
 
 
 
 
 
 
Ordinary annual services
208,769
-
-
-
46,167
(3,466)
251,470
266,900
(15,430)
Other services
 
 
 
 
 
 
 
 
 
Equity
234
-
-
-
 
-
234
5,112
(4,878)
Total departmental
209,003
-
-
-
46,167
(3,466)
251,704
272,012
(20,308)
ADMINISTERED
 
 
 
 
 
 
 
 
 
Ordinary annual services
 
 
 
 
 
 
 
 
 
Administered items
473,196
(11,277)
-
550
 
(1,229)
461,240
428,694
32,546
Other services
 
 
 
 
 
 
 
 
 
States, ACT, NT and Local Governments
5,000
(2,188)
-
-
 
-
2,812
2,655
157
Administered assets and liabilities
177,559
-
-
20
 
-
177,579
6,501
171,078
Total administered
655,755
(13,465)
-
570
 
(1,229)
641,631
437,850
203,781

Notes

(1) Appropriations reduced under Appropriation Acts (No 1 & 3) 2012-13: sections 10,11, 12 and 15 and under Appropriation Acts (No 2 & 4) 2012-13: sections 12, 13, 14 and 17. (Refer Note 30F).

(2) The variances reflect drawdowns of prior year appropriation and timing differences between expenses and cash outflows.

Table B: Departmental and administered capital budgets ('recoverable GST exclusive')

 
2014 Capital Budget Appropriations
Capital Budget Appropriation applied in 2014
(current and prior years)
 
 
Appropriation Act
FMA Act
Total Capital Budget Appropriations
 
 
 
 
 
Annual Capital Budget
Appropriations reduced
Section 32
Payments for non-financial assets 1
Payments for other purposes
Total payments
Variance
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
DEPARTMENTAL
 
 
 
 
 
 
 
 
Ordinary annual services - Departmental Capital Budget 1
8,666
-
-
8,666
8,385
-
8,385
281
ADMINISTERED
 
 
 
 
 
 
 
 
Ordinary annual services - Administered Capital Budget 2
2,769
-
1,685
4,454
3,704
-
3,704
750

Notes:

(1) Payments made on non-financial assets include purchase of assets, expenditure on assets that have been capitalised, and costs to make good an asset to its original condition.

(2) Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No 1 & 3). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.

 
2013 Capital Budget Appropriations
Capital Budget Appropriation applied in 2013
(current and prior years)
 
 
Appropriation Act
FMA Act
Total Capital Budget Appropriations
 
 
 
 
 
Annual Capital Budget
Appropriations reduced
Section 32
Payments for non-financial assets 1
Payments for other purposes
Total payments
Variance
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
DEPARTMENTAL
 
 
 
 
 
 
 
 
Ordinary annual services - Departmental Capital Budget 1
7,289
-
(642)
6,647
8,132
-
8,132
(1,485)
ADMINISTERED
 
 
 
 
 
 
 
 
Ordinary annual services - Administered Capital Budget 2
1,887
-
-
1,887
-
-
-
1,887

Notes:

(1) Payments made on non-financial assets include purchase of assets, expenditure on assets that have been capitalised, and costs to make good an asset to its original condition.

(2) Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No 1 & 3). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.

Table C: Unspent annual appropriations ('recoverable GST exclusive')

 
2014
2013
Authority
$'000
$'000
DEPARTMENTAL  
 
 
 
2010/11 Appropriation Act 1
-
6,870
2010/11 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
-
170
2010/11 Appropriation Act 3
-
32
2011/12 Appropriation Act 1
-
4,520
2011/12 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
-
60
2011/12 Act 2 - Non Operating - Equity Injection
-
637
2011/12 Appropriation Act 3
-
1,698
2011/12 Appropriation Act 3 - Capital Budget (DCB) - Non Operating
-
5,700
2011/12 Act 4 - Non Operating - Equity Injection
-
1,327
2012/13 Appropriation Act 1
7,161
23,952
2012/13 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
-
2,341
2012/13 Act 2 - Non Operating - Equity Injection
-
100
2012/13 Appropriation Act 3
-
482
2013/14 Appropriation Act 1
24,088
-
2013/14 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
7,626
-
2013/14 Act 2 - Non Operating - Equity Injection
1,451
-
2013/14 Appropriation Act 3
13,633
-
2013/14 Appropriation Act 3 - Capital Budget (DCB) - Non Operating
926
-
2013/14 Act 4 - Non Operating - Equity Injection Non Operating - AG
5,469
-
2013/14 Appropriation Act 5
1,995
-
Total departmental
62,349
47,889
 
2014
2013
Authority
$'000
$'000
ADMINISTERED  
 
 
 
2006/07 Act 2 - Non Operating - Administered Assets and Liabilities
-
56,039
2007/08 Act 2 - Non Operating - Administered Assets and Liabilities
-
81
2008/09 Act 2 - Non Operating - Administered Assets and Liabilities
-
5,015
2008/09 Retained Prior Years Appropriation
-
2,500
2009/10 Act 2 - Non Operating - Administered Assets and Liabilities
-
3,541
2009/10 Appropriation Act 4 - SPP
-
112
2010/11 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
-
1,128
2011/12 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
-
891
2011/12 Act 2 - Non Operating - Administered Assets and Liabilities
-
11,055
2012/13 Appropriation Act 1
7,455
6,944
2012/13 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
-
1,887
2012/13 Appropriation Act 3
17,822
25,200
2012/13 Appropriation Act 2 - SPP
314
1,490
2012/13 Act 4 - Non Operating - Administered Assets and Liabilities
13,044
14,567
2013/14 Appropriation Act 1 Outcome 1
74,450
-
2013/14 Appropriation Act 1 Outcome 2
1,227
-
2013/14 Appropriation Act 1 - Capital Budget (DCB) - Non Operating
2,769
-
2013/14 Act 2 - Non Operating - Administered Assets and Liabilities
15,315
-
2013/14 Appropriation Act 2 - SPP
1,097
-
2013/14 Act 4 - Non Operating - Administered Assets and Liabilities
1,281
-
2013/14 Act 6 - Non Operating - Administered Assets and Liabilities
5,043
-
Total administered
139,817
130,450

Table D: Special appropriations applied ('recoverable GST exclusive')

     
Appropriation Applied
     
2014
2013
Authority Type Purpose
$'000
$'000
High Court Justices (Long Leave Payments) Act 1979 Unlimited To make provisions for long leave payments for Justices of the High Court.
-
950
     
 
 
Law Officers Act 1964 Unlimited To make payments of pensions and benefits to former Solicitors General. All transactions under this Act are recognised as Administered items.
414
404
     
 
 
Judges (Long Leave Payments) Act 1979 Unlimited To make provisions for long leave payments for Judges.
89
-
     
 
 
Social Security (Administration) Act 1999 Unlimited To enable the payment of income support payments. All transactions under this Act are recognised as Administered items.
29,085
168,879
     
 
 
Financial Management and Accountability Act 1997 Refund To provide for payments under Section 28 of the FMA Act. All transactions under this Act are recognised as Administered items.
27
-
     
-
 
Total special appropriation applied    
29,615
170,233

The following Agencies have been issued with Drawing Rights, that permit them to spend money from the consolidated revenue fund on behalf of the Department:

*Australian Financial Security Authority

*Australian Law Reform Commission

*Department of Finance

*Department of Human Services

*Department of Social Services

Table E: Disclosure by agent in relation to annual and special appropriations ('recoverable GST exclusive')

  Australian Public Service Commission - Payments in relation to the Remuneration Tribunal Act 1973 s7(13) Remuneration (including salary) or allowances Department of Finance Parliamentary Entitlements Act 1990 s11, 5 (1)(b) and Parliamentary Entitlements Regulations 1997, Part 3 - Legal assistance to ministers
2014
$'000
$'000
Total receipts
3,726
99
Total payments
3,727
124
  Australian Public Service Commission- Payments in relation to the Remuneration Tribunal Act 1973 s7(13) Remuneration (including salary) or allowances Department of Finance Parliamentary Entitlements Act 1990 s11, 5 (1)(b) and Parliamentary Entitlements Regulations 1997, Part 3 - Legal assistance to ministers
2013
$'000
$'000
Total receipts
3,647
104
Total payments
3,647
98

Other Special Appropriations that had nil balances at the end of the 2013-14 financial year and where there were no transactions debited or credited to them during the 2013-14 financial year are:

  • Native Title Act 1993 Purpose: Payment of successful Native Title compensation claims
  • National Firearms Program Implementation Act 1996 Purpose: Provide financial assistance and other expenditure in connection with the implementation of the national firearms program
  • National Firearms Program Implementation Act 1997 Purpose: Provide for financial assistance in connection with the implementation of the national firearms program, and for related purposes
  • National Firearms Program Implementation Act 1998 Purpose: Provide for financial assistance in connection with the implementation of the national firearms program, and for related purposes
  • National Handgun Buyback Act 2003 Purpose: Provide financial assistance for qualifying payments made by the States and other expenditure in connection with the implementation of the handgun buyback and related purposes
  • High Court of Australia Act 1979 Purpose: Salary and Allowances of Judges
  • High Court Justices (Long Leave Payments) Act 1979 Purpose: Make provisions for long leave payments for Justices of the High Court.
  • Federal Court of Australia Act 1976 Purpose: Salary and allowances of Judges
  • Family Law Act 1975 Purpose: Salary and allowances of Judges
  • Crimes (Superannuation Benefits) Act 1989 Purpose: Superannuation benefits paid or payable to or in respect of certain persons convicted of corruption offences, and for related purposes
  • Commonwealth Places (Application of Laws) Act 1970 Purpose: Application and administration of laws in places acquired by the Commonwealth for public purposes
  • Classification (Publications, Films and Computer Games) Act 1995 Purpose: Payments to the States regarding costs of administering the scheme
  • Remuneration and Allowances Act 1990 Purpose: Salary and allowances of judges
  • Federal Magistrates Act 1999 Purpose: To make provision for death or invalidity benefits for judges

Table F: Reduction in administered items ('recoverable GST exclusive')

 
Amount required 1 - by Appropriation Act
Total amount appropriated 2
Total amount required 3
Total reduction 4
2014            
Ordinary Annual Services
Act (No.1)
Act (No.3)
Act (No.5)
     
Outcome 1
532,730,000.00
0.00
0.00
532,730,000.00
493,216,571.81
39,513,428.19
Outcome 2
132,701,000.00
0.00
914,000.00
133,615,000.00
133,222,774.00
392,226.00
             
Other Services
Act (No.2)
Act (No.4)
Act (No.6)
     
Specific payments to States, ACT, NT and Local government          
Outcome 1
5,000,000.00
0.00
0.00
5,000,000.00
5,000,000.00
0.00

1. Administered items for 2014 were reduced to these amounts when these financial statements were tabled in Parliament as per the Attorney-General's Department 2014 annual report. This reduction is effective in 2015, but the amounts are reflected in Table A in the 2014 financial statements in the column 'Appropriation reduced' as they are adjustments to 2014 appropriations.

2. Total amount appropriated in 2014.

3. Amounts required as per Appropriation Act (Act 1 s 11; Act 2 s 12).

4. Total reduction effective 2015.

 
Amount required 1 - by Appropriation Act
Total amount appropriated 2
Total amount required 3
Total reduction 4
2013            
Ordinary Annual Services
Act (No.1)
Act (No.3)
Act (No.5)
     
Outcome 1
414,315,000.00
58,881,000.00
0.00
473,196,000.00
460,690,000.00
12,506,000.00
             
Other Services
Act (No.2)
Act (No.4)
Act (No.6)
     
Specific Payments to States, ACT, NT and Local government          
Outcome 1
5,000,000.00
0.00
0.00
5,000,000.00
2,812,022.00
2,187,978.00

1. Administered items for 2013 were reduced to these amounts when these financial statements were tabled in Parliament as per the Attorney-General's Department 2013 annual report. This reduction is effective in 2014, but the amounts are reflected in Table A in the 2013 financial statements in the column 'Appropriation reduced' as they are adjustments to 2013 appropriations.

2. Total amount appropriated in 2013.

3. Amounts required as per Appropriation Act (Act 1 s 11; Act 2 s 12).

4. Total reduction effective 2014.

Note 31: Special

 
Services for Other Entities and Trust Money - Attorney-General's Department Special Account 2
Art Rental Special Account 3
Cultural Special Account 4
 
2014
$'000
2013
$'000
2014
$'000
2013
$'000
2014
$'000
2013
$'000
Balance brought forward from previous period
5,929
10,400
-
-
-
-
Increases
 
 
 
 
 
 
Appropriation credited to special account
-
-
1,212
-
96
-
Receipts
-
-
3,364
-
526
-
Other receipts
25,311
6,913
1,364
-
-
-
Total increases
25,311
6,913
5,940
-
622
-
Available for payments
31,240
17,313
5,940
-
622
-
Decreases
 
 
 
 
 
 
Departmental
 
 
 
 
 
 
Payments made: suppliers
-
-
(4,334)
-
(506)
-
Total departmental
-
-
(4,334)
-
(506)
-
 
 
 
 
 
 
 
Administered
 
 
 
 
 
 
Payments made: suppliers
(25,282)
(11,384)
-
-
-
-
Appropriation debited from special account
-
-
-
-
-
-
Total administered
(25,282)
(11,384)
-
-
-
-
Total decreases
(25,282)
(11,384)
(4,334)
-
(506)
-
Total balance carried to the next period
5,958
5,929
1,606
-
116
-
 
 
 
 
 
 
 

accounts 1

 
National Collections Special Account 5
Indigenous Repatriation Special Account 6
National Cultural Heritage Special Account 7
 
2014
$'000
2013
$'000
2014
$'000
2013
$'000
2014
$'000
2013
$'000
Balance brought forward from previous period
-
-
-
-
-
-
Increases
 
 
 
 
 
 
Appropriation credited to special account
96
-
3,741
-
500
-
Other receipts
-
-
 
-
-
-
Total increases
96
-
3,741
-
500
-
Available for payments
96
-
3,741
-
500
-
Decreases
 
 
 
 
 
 
Departmental
 
 
 
 
 
 
Payments made: suppliers
(48)
-
(984)
-
-
-
Appropriation debited from special account
-
-
(35)
-
-
-
Total departmental
(48)
-
(1,019)
-
-
-
 
 
 
 
 
 
 
Administered
 
 
 
 
 
 
Payments made: suppliers
-
-
-
-
(479)
-
Total administered
-
-
-
-
(479)
-
Total decreases
(48)
-
(1,019)
-
(479)
-
Total balance carried to the next period
48
-
2,722
-
21
-

1 As a result of 18 September 2013 administrative arrangements, the Department assumed responsibility for the Arts function from the Department of Regional Australia, Local Government, Arts and Sport with effect from 19 September 2013 (Note 10 refers).

2. Appropriation: Financial Management and Accountability Act 1997; section 20.
Establishing Instrument: Financial Management and Accountability Determination 2011/04.
Purpose: Amounts may be debited from the special account for:
(a) to disburse amounts held on trust or otherwise for the benefit of a person other than the Commonwealth;
(b) to disburse amounts in connection with services performed on behalf of other governments and bodies that are note FMA Act agencies;
(c) to repay amounts where an Act or other law requires or permits the repayment of an amount received; and
(d) to reduce the balance of the Special Account (and, therefore, the available appropriation for the Special Account) without making a real or notional payment.
This account is non-interest bearing and the balance is held in the Official Public Account.

3. Appropriation: Financial Management and Accountability Act 1997; section 20.
Establishing Instrument: Financial Management and Accountability Determination 2006/18.
Purpose: Amounts may be debited from the special account for:
(a) acquire, deaccession, lease, promote, develop, exhibit, lend, conserve and undertake any other activities in relation to managing an art rental collection for the Commonwealth;
(b) activities that are incidental to the purposes mentioned in paragraph (a); and
(c) the repayment of amounts where an Act or other law requires or permits the repayment of an amount received.
This account is non-interest bearing and the balance is held in the Official Public Account.

4. Appropriation: Financial Management and Accountability Act 1997; section 20.
Establishing Instrument: Financial Management and Accountability Determination 2011/18.
Purpose: Amounts may be debited from the special account for:
(a) conducting activities that are approved by the Minister for the Arts and are joint arrangements with one or more State and Territory governments;
(b) incidental activities including the administration of the Special Account and dealing with direct and indirect costs; and
(c) the repayment of amounts where an Act or other law requires or permits the repayment of an amount received.
This account is non-interest bearing and the balance is held in the Official Public Account.

5. Appropriation: Financial Management and Accountability Act 1997; section 20.
Establishing Instrument: Financial Management and Accountability Determination 2005/44.
Purpose: Amounts may be debited from the special account for:
(a) conducting projects, programmes and strategies approved by the responsible agency, associated with future directions, needs and priorities of the collection sector;
(b) activities that are incidental to the purposes mentioned in paragraph (a); and
(c) the repayment of amounts where an Act or other law requires or permits the repayment of an amount received.
This account is non-interest bearing and the balance is held in the Official Public Account.

6. Appropriation: Financial Management and Accountability Act 1997; section 20.
Establishing Instrument: Financial Management and Accountability Determination 2011/16.
Purpose: Amounts may be debited from the special account for:
(a) developing and conducting projects, programmes and strategies associated with the repatriation of Indigenous ancestral remains and sacred objects;
(b) activities that are incidental to the purposes mentioned in paragraph (a); and
(c) the repayment of amounts where an Act or other law requires or permits the repayment of an amount received.
This account is non-interest bearing and the balance is held in the Official Public Account.

7. Appropriation: Financial Management and Accountability Act 1997; section 21.
Establishing Instrument: Protection of Moveable Cultural Heritage Act 1986 section 25.
Purpose: Amounts standing to the credit of the National Cultural Heritage Account may b expended for the purpose of facilitating the acquisition of the Australian protected objects for display or self keeping.
This account is non-interest bearing and the balance is held in the Official Public Account.

Compliance with Statutory Conditions for Payments from the Consolidated Revenue Fund

The Department of Human Services (DHS) provides assessment and payment services on behalf of AGD in disaster-affected locations to claimants assessed as being eligible and who meet the statutory conditions authorising payments to be made under the Social Security Act 1991 and the Social Security (Administration) Act 1999. The conditions and circumstances under which payments are made may contribute to a circumstance where there is an incorrect payment arising from a mistake of fact.

Both AGD and DHS have an ongoing program designed to detect, and where appropriate, recover any unauthorised payment. The outcome of work undertaken during the 2012-13 financial year by both AGD and DHS identified the following:

  • In 2013-14 132 (2013: 260) potential non-compliant prior years payments totalling $252,188 (2013: $312,855) were identified; and
  • No payments made in 2013-14 (2013: nil) are currently under investigation. While AGD and DHS continue to follow up potential overpayments and seek recovery where appropriate, the enactment of the amendments to the Social Security Act 1991 and Social Security (Administration) Act 1999 effective by Financial Framework Legislation Amendment Act (No 2) Act 2013 on 28 May 2013 have the effect that overpayments made in good faith will not give rise a breach of section 83.

Note 32: Compensation and debt relief

<><><><><>  
 
2014
2013
 
$'000
$'000
Departmental
 
 
No 'Act of Grace' expenses were incurred during the reporting period. (2013: No expenses).
-
-
No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997. (2013: No waivers)
-
-
No payments were made under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period. (2013: One payment).
-
1
No ex-gratia payments were provided for during the reporting period.
(2013: No payments).
-
-
No payments were provided in special circumstances relating to APS employment pursuant to s73 of the Public Service Act 1999 during the reporting period (2013: No payments).
-
-
Administered
 
 
No 'Act of Grace' expenses were incurred during the reporting period. (2013: No expenses).
-
-
No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997. (2013: No waivers)
-
-
No payments were provided for under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period. (2013: No payments).
-
-
No ex-gratia payments were provided for during the reporting period.
(2013: No payments).
-
-
No payments were provided in special circumstances relating to APS employment pursuant to s73 of the Public Service Act 1999 during the reporting period. (2013: No payments).
-
-

Note 33: Reporting of outcomes

The Department uses budgeted average staffing levels to determine the attribution of its shared items. The basis of attribution in the table is consistent with the basis used for the 2013-14 Budget.

33A: Net cost of outcome delivery

 
Outcome 1
Outcome 2
Payments to CAC Act bodies*
Total
 
2014
2013
2014
2013
2014
2013
2014
2013
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Departmental
 
 
 
 
 
 
 
 
Expenses
(321,383)
(262,205)
(30,814)
-
-
-
(352,197)
(262,205)
Own-source income
93,319
43,845
6,726
-
-
-
100,045
43,845
 
 
 
 
 
 
 
 
 
Administered
 
 
 
 
 
 
 
 
Expenses
(543,935)
(626,881)
(129,446)
-
(279,414)
-
(952,795)
(626,881)
Income
27,822
30,947
1,161
-
-
-
28,983
30,947
Net cost/(contribution) of outcome delivery
(744,177)
(814,294)
(152,373)
-
(279,414)
-
(1,175,964)
(814,294)

 

Outcome 1 and 2 are described in Note 1.1. Net costs shown include intra-government costs that are eliminated in calculating the actual Budget Outcome. Refer to Outcome 1 Resourcing Table and Outcome 2 of this Annual Report.

*Payments to CAC bodies are not related to the outcomes of the Department. They are included here so the total can agree to the resourcing table.

33B: Major classes of departmental expense, income, assets and liabilities by outcomes

 
Outcome 1
Outcome 2
Total
 
2014
2013
2014
2013
2014
2013
 
$'000
$'000
$'000
$'000
$'000
$'000
Expenses
 
 
 
 
 
 
Employees
165,127
160,233
20,415
-
185,542
160,233
Suppliers
130,634
79,694
5,572
-
136,206
79,694
Grants
2,869
708
-
-
2,869
708
Depreciation and amortisation
22,709
21,499
3,316
-
26,025
21,499
Other expenses
44
71
1,511
-
1,555
71
Total expenses
321,383
262,205
30,814
-
352,197
262,205
 
 
 
 
 
 
 
Own-source income
 
 
 
 
 
 
Income from government
216,434
198,397
13,965
-
230,399
198,397
Sale of goods and services
92,389
43,440
4,624
-
97,013
43,440
Other revenue
-
-
2,102
-
2,102
-
Gains
930
405
-
-
930
405
Total own-source income
309,753
242,242
20,691
-
330,444
242,242
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
Cash and cash equivalents
2,737
1,794
1,657
-
4,394
1,794
Trade and other receivables
84,356
56,435
6,495
-
90,851
56,435
Land and buildings
66,136
73,780
20
-
66,156
73,780
Property, plant and equipment
24,455
21,167
35,624
-
60,079
21,167
Intangibles
20,669
25,832
77
-
20,746
25,832
Other non-financial assets
4,292
4,652
1,518
-
5,810
4,652
Total assets
202,645
183,660
45,391
-
248,036
183,660
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
Suppliers
30,587
27,033
1,412
-
31,999
27,033
Grants
80
-
-
-
80
-
Other payables
34,193
17,332
2,425
-
36,618
17,332
Employee provisions
37,609
37,900
3,945
-
41,554
37,900
Makegood provisions
124
341
-
-
124
341
Other provisions
3,568
-
-
-
3,568
-
Total liabilities
106,161
82,606
7,782
-
113,943
82,606

 

Outcome 1 and 2 are described in Note 1.1.

On 18 September 2013 the Department assumed responsibility for the arts and culture functions from the Department of Regional Australia, Local Government, Arts and Sport

33C: Major classes of administered expense, income, assets and liabilities by outcomes

 
Outcome 1
Outcome 2
Payments to CAC bodies*
Total
 
2014
2013
2014
2013
2014
2013
2014
2013
 
$'000
$'000
$'000
$'000
$'000
$'000
$'000
$'000
Expenses
 
 
 
 
 
 
 
 
Employee benefits
27,589
6,568
4
-
-
-
27,593
6,568
Suppliers
104,574
45,399
22,262
-
-
-
126,836
45,399
Subsidies
3,296
2,458
-
-
-
-
3,296
2,458
Personal benefits
31,194
177,093
-
-
-
-
31,194
177,093
Grants
373,895
392,005
105,989
-
-
-
479,884
392,005
Write-down and impairment of assets
(1,050)
934
59
-
-
-
(991)
934
Depreciation and amortisation
4,437
2,424
1,132
-
-
-
5,569
2,424
Payments to CAC Act bodies
-
-
-
-
279,414
-
279,414
-
Total expenses
543,935
626,881
129,446
-
279,414
-
952,795
626,881
 
 
 
 
 
 
 
 
 
Income
 
 
 
 
 
 
 
 
Dividends
4,723
9,000
-
-
-
-
4,723
9,000
Competitive neutrality
3,997
4,711
-
-
-
-
3,997
4,711
Sale of goods and rendering of services
6,226
5,712
-
-
-
-
6,226
5,712
Interest
1,626
2,020
-
-
-
-
1,626
2,020
Recoveries
252
316
-
-
-
-
252
316
Other revenue
10,880
9,188
1,161
-
-
-
12,041
9,188
Other gains
118
-
-
-
-
-
118
-
Total income
27,822
30,947
1,161
-
-
-
28,983
30,947
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
 
 
 
 
Cash and cash equivalents
4
1
-
-
-
-
4
1
Loans and receivables
123,254
33,477
962
-
-
-
124,216
33,477
Investments
381,358
380,476
8,260,574
-
-
-
8,641,932
380,476
Other currrent assets
-
-
5,910
-
-
-
5,910
-
Land and Buildings
8,850
7,200
58,013
-
-
-
66,863
7,200
Property, plant and equipment
9,053
4,380
-
-
-
-
9,053
4,380
Intangibles
2,245
560
-
-
-
-
2,245
560
Other non-financial assets
1,640
354
9
-
-
-
1,649
354
Total assets
526,404
426,448
8,325,468
-
-
-
8,851,872
426,448
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
Suppliers
20,028
7,414
236
-
-
-
20,264
7,414
Grants
12,846
9,243
578
-
-
-
13,424
9,243
Other payables
689
595
-
-
-
-
689
595
Employee provisions
771
-
-
-
-
-
771
-
Superannuation provisions
5,800
5,703
-
-
-
-
5,800
5,703
Total liabilities
40,134
22,955
814
-
-
-
40,948
22,955

 

Outcome 1 and 2 are described in Note 1.1.

*Payments to CAC bodies are not related to the outcomes of the Department. They are included here so the total can agree to the resourcing table.

On 18 September 2013 the Department assumed responsibility for the arts and culture functions from the Department of Regional Australia, Local Government, Arts and Sport (Note 10 refers).

Note 34: Cost recovery

34A: Cost recovery summary

    2014 2013
  Notes $'000 $'000
Amounts applied  
 
 
 
 
 
Departmental  
 
 
 
 
 
Annual appropriation  
 
28,316
24,664
Administered  
 
 
 
 
 
Special appropriation (including special accounts)  
 
124
196
Total amounts applied  
 
28,440
24,860
   
 
 
 
 
 
Expenses  
 
 
 
 
 
Departmental  
 
28,906
26,979
Administered  
 
124
197
Total expenses  
 
29,030
27,176
   
 
 
 
 
 
Revenue  
 
 
 
 
 
Departmental  
 
16,554
13,460
Administered  
 
5,102
5,528
Total revenue  
 
21,656
18,988
   
 
 
 
 
 
Receivables  
 
 
 
 
 
Not overdue  
 
1,620
1,089
Overdue by:  
 
 
 
 
 
0 to 30 days  
 
188
304
31 to 60 days  
 
93
231
61 to 90 days  
 
46
50
More than 90 days  
 
37
49
Total receivables  
 
1,984
1,723
   
 
 
 
 
 
Amounts written off  
 
 
 
 
 
Departmental  
 
3
(1)
Total amounts written off  
 
3
(1)

Cost recovered activities:

AusCheck Background Checking Service: coordinates national security background checks and related functions for the aviation, maritime and national health security schemes. The enabling legislation is the AusCheck Act 2007 and the AusCheck Regulations 2007.

Protective Security Training Registration Fees: fees associated with undertaking protective security courses/training at the Proctective Security Training College (PSTC). The PSTC is a leading national provider of security training to Commonwealth, State/Territory agencies and organisations dedicated to safegauarding Australia's critical infrastructure.

Sale of Publications associated with Emergency Management Training and Marriage Celebrant stationery.

Classification Fees: classification decisions upon receipt of a valid application for classification accompanied by the prescribed fee. With limited exceptions every film, computer game and certain publications must be classified before they can be legally made available to the Australian public by means of sale, exhibition and commercial distribution. The Classification Act is the enabling legislation.

ASNET Levy Fees: ASNET is the Australian Secure Network operated by AGD used for the exchange of information between the Commowealth and State/Terrirtory agencies related to national security. The ASNET Levy fee is the annual amount paid by State/Territory Governments to access the network.

Cost Recovery Impact Statements (CRISs) for the above activities is available on AusCheck Fees and on the Classification website​.

Note 35: Net cash appropriation arrangements

 
2014
2013
 
$'000
$'000
Total comprehensive loss less depreciation/amortisation expenses previously funded through revenue appropriations 1
4,000
1,241
Plus: depreciation/amortisation expenses previously funded through revenue appropriation 2
(25,753)
(21,020)
Total comprehensive loss - as per the Statement of Comprehensive Income 1
(21,753)
(19,779)

1 From 2010-11 the Government introduced net cash appropriation arrangements, where revenue appropriation for depreciation/amortisation expenses ceased. Entities now receive a separate capital budget provided through equity appropriations (refer Statement of Changes in Equity).

2 This amount varies from the depreciation and amortisation expense shown in the Statement of Comprehensive Income by $0.272m (2013: $0.479m) which represents the component of depreciation and amortisation that has been cost-recovered through external income generating activities of the Department. (Refer Note 3D).

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