Climate Change Authority

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Notes to and forming part of the Financial Statements

Note Description

1 Summary of Significant Accounting Policies

2 Events After the Reporting Period

3 Expenses

4 Income

5 Fair Value Measurements

6 Financial Assets

7 Non-Financial Assets

8 Payables

9 Provisions

10 Cash Flow Reconciliation

11 Contingent Liabilities and Assets

12 Senior Executive Remuneration

13 Authority Members Remuneration

14 Remuneration of Auditors

15 Financial Instruments

16 Financial Assets Reconciliation

17 Appropriations

18 Compensation and Debt Relief

19 Reporting of Outcomes

20 Net Cash Appropriation Arrangements

Note 1: Summary of Significant Accounting Policies

1.1 Objectives of the Climate Change Authority

The Climate Change Authority (the Authority) was established under the Climate Change Authority Act 2011 and commenced operation on 1 July 2012.

The Authority is an Australian Government controlled entity. It is a not-for-profit entity. The Authority’s role is to undertake independent reviews, research and analysis and provide relevant, insightful, practical advice to the Australian Government on climate change policy that is in the best interests of the Australian community.

The Authority is structured to meet one outcome:

Outcome 1: Provide expert advice to the Australian Government on climate change mitigation initiatives, including the level of carbon pollution caps, the carbon price mechanism, the Renewable Energy target and progress achieving Australia’s emissions reduction targets, through conducting periodic reviews and undertaking climate change research.

Activities contributing toward this outcome are classified as departmental. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the Authority in its own right.

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

1.2 Basis of Preparation of the Financial Statements

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

The financial statements have been prepared in accordance with:

  • Finance Minister’s Orders (FMOs) for reporting periods ending on or after 1 July 2011; 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 the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

The financial statements are presented in Australian dollars and values are rounded to the nearest thousand dollars unless otherwise specified.

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 Authority 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 are reported in the schedule of commitments.

Unless 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.

1.3 Significant Accounting Judgements and Estimates

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

The fair value of leasehold improvements has been taken to be the incurred cost of the fitout to the former Department of Climate Change and Energy Efficiency. This amount has been brought to account as an equity contribution in the creation of the Climate Change Authority in 2012–13.

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.

New standards, amendments to standards or interpretations that were issued prior to the sign-off date and are applicable to the current reporting period did not have a material financial impact, and are not expected to have a material financial impact on the Authority’s financial statements for future reporting periods. Specific consideration has been given to the following standards:

AASB 13 Fair Value Measurement

AASB 119 Employee Benefits

Future Australian Accounting Standard Requirements

New standards, amendments to standards or interpretations that were issued by the Australian Accounting Standards Board prior to the sign-off date and are applicable for future reporting periods are expected to have significant impact on the Authority’s financial statements for future reporting periods.

Consideration has been given to following standards:

AASB 9 Financial Instruments

AASB 1055 Budgetary Reporting

1.5 Revenue

Revenue from Government

Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the Authority 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.

Other Types of Revenue

Revenue from other sources are recognised when:

  • the revenue and transaction costs incurred can be reliably measured; and
  • it is probable that the economic benefits associated with the transaction will flow to the Authority.

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:

  • the amount of revenue, stage of completion and transaction costs incurred can be reliably measured; and
  • the probable economic benefits associated with the transaction will flow to the Authority.

The stage of completion of contracts 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.

Revenue for the Victorian Government Grant (note 4A 2013) was recognised when the Authority was able to establish it had met the criteria under the terms of the agreement.

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 at the end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

1.6 Gains

Other 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 entity 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’ for a year (less any formal reductions) and 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 entity under a restructuring of administrative arrangements are adjusted at their book value directly against contributed equity.

Other Distributions to Owners

The FMOs require that distributions to owners be debited to contributed equity unless it is in the nature of a dividend.

1.8 Employee Benefits

Liabilities for ‘shortterm employee benefits’ (as defined in AASB 119 Employee Benefits) and termination benefits due within twelve months of the end of reporting period 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 net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

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 nonvesting and the average sick leave taken in future years by employees of the Authority 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 applied at the time the leave is taken, including the Authority’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 use of the Australian Government Actuary’s shorthand method using the Standard Commonwealth sector probability profile. 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 Authority 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. There is no current plan for terminations and therefore the current provision is nil.

Superannuation

The majority of staff at the Authority 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 in the Department of Finance’s administered schedules and notes.

The Authority makes employer contributions to the employees’ superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government. The Authority 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 component and the interest expense.

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

1.10 Fair Value Measurement

The Department deems transfers between levels of the fair value hierarchy to have occurred at the end of the reporting period.

1.11 Cash

Cash is recognised at its nominal amount. Cash and cash equivalents includes cash on hand, cash held by outsiders, and demand deposits in bank accounts with an original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value.

1.12 Financial Assets

The Authority classifies its financial assets in the following categories:

  • financial assets at fair value through profit or loss;
  • held-to-maturity investments; and
  • receivables.

The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. The Authority currently only holds financial assets of receivables.

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.

Receivables

Trade receivables and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘receivables’. 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 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 at 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.

1.13 Financial Liabilities

Financial liabilities are classified as either financial liabilities ‘at fair value through profit or loss’ or other financial liabilities. The Authority only holds other financial liabilities.

Financial liabilities are recognised and derecognised upon ‘trade date’.

Other Financial Liabilities

Other financial liabilities, including supplier and other payables, are recognised at measured cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

1.14 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 notes. They may arise from uncertainty as to the existence of a liability or an 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.

Details of each class of contingent liabilities and contingent assets are disclosed in Note 11: Contingent Assets and Liabilities.

1.15 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 amounts at which they were recognised in the transferor’s accounts immediately prior to the restructuring.

1.16 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 cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make-good’ provisions in property leases taken up by the Authority where there exists an obligation to ‘make-good’ premises. These costs are included in the value of the Authority’s leasehold improvements with a corresponding provision for the ‘make-good’ recognised.

Revaluations

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

Asset Class

Fair Value Measured At

Leasehold improvements

Depreciated replacement cost

Property, Plant and equipment

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 did not differ materially from the assets’ fair values at the reporting date. The regularity of independent valuations depended 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 surplus/deficit. Revaluation decrements for a class of assets were recognised directly in 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 Authority using, in all cases, the straight-line method of depreciation.

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

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

 

2014

2013

Leasehold improvements and make-good

Lease term

Lease term

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 Authority were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

Derecognition

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

1.17 Intangibles

The Authority’s intangibles comprise commercially purchased software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.

 

2014

2013

Intangibles (computer software)

5 years

5 years

Software is amortised on a straight-line basis over its anticipated useful life. The useful lives of the Authority’s software are 5 years.

All software assets were assessed for indications of impairment as at 30 June 2014.

1.18 Taxation

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

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

  • where the amount of GST incurred is not recoverable from the Australian Taxation Office; and
  • for receivables and payables.

1.19 Constitutional and Other Legal Requirements

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.

1.20 Going Concern

As a result of the Government’s climate change policy, including the commitment to repeal the carbon pricing mechanism, no direct appropriation funding has been provided for the Authority in the 2014–15 Portfolio Budget Statements. Nevertheless, the financial report has been prepared on a going concern basis because:

  • Legislation which determines the future of the Authority is before the Senate as at the date of signing of these financial statements;
  • Funding to support existing functions of the Authority is incorporated in the appropriation funding of the Department of the Environment;
  • These funds were provided to meet the ongoing work program in the event the Authority was wound up; and
  • If wound up under the current legislation before the Senate all references to the Authority, with respect to records, instruments and appropriations, are to be read as references to the Department of the Environment.

Note 2: Events After the Reporting Period

On the resumption of Parliament on 26 August 2014, the Senate is scheduled to consider legislation (The Climate Change Authority Abolition Bill 2013) that will determine the future of the Authority.

There are no other events occurring after balance date that materially affect the financial statements for the year ended 30 June 2014.

Note 3: Expenses

Note 3A: Employee Benefits

 

 

2014

2013

 

 

$’000

$’000

Wages and salaries

 

3,321

2,808

Superannuation:

 

 

 

Defined contribution plans

313

266

Defined benefits plans

237

191

Leave and other entitlements

 

302

564

Other Expenses

 

10

6

Total employee benefits

 

4,183

3,835

 

 

Note 3B: Suppliers


 

 

2014

2013

 

 

$’000

$’000

Goods and services supplied or rendered

Consultants

 

114

22

Contractors

 

518

336

Travel

 

197

204

IT Services

 

11

52

Subscriptions

 

85

101

Administrative Services under MoU

 

312

359

Comcover

 

24

29

Minor office equipment, furniture and fittings

 

0

54

Telephone Services (PABX)

 

33

51

Protective Security

 

0

50

Staffing & recruitment expenses

 

92

187

Buildings outgoings and related

 

0

261

Other

 

132

176

Total goods and services supplied or rendered

 

1,518

1,882

 

 

 

 

Goods and services supplied or rendered are made up of:

Provision of goods – related parties

0

0

Provision of goods – external parties

0

97

Rendering of services – related parties

330

1,450

Rendering of services – external parties

1,188

335

Total goods and services supplied or rendered

 

1,518

1,882

 

 

 

 

Other supplier expenses

 

 

 

Operating lease rentals – external parties:

 

 

 

Minimum lease payments

493

412

Workers compensation premiums

 

43

44

Total other suppliers expenses

 

536

456

Total suppliers

 

2,054

2,338

 

 

 

 

 

Note 3C: Depreciation and Amortisation

 

 

2014

2013

 

 

$’000

$’000

Depreciation:

 

 

 

Buildings – leasehold improvements

Property, plant and equipment

245

215

22

8

Total depreciation

267

223

 

Amortisation:

 

 

 

Intangibles

18

7

Total amortisation

18

7

Total depreciation and amortisation

285

230

 

 

Note 4: Own-Source Revenue

4A: Sale of Goods and Rendering of Services

 

 

2014

2013

 

 

$’000

$’000

Rendering of services

 

 

Victorian Government Grant

0

316

Total rendering of services

0

316

 

 

Note 4B: Other Gains

 

2014

2013

 

$’000

$’000

Resources received free of charge

 

 

ANAO Audit Services

50

50

Total other gains

50

50

 

 

 

 

 

 

 

Revenue From Government

Note 4C: Revenue from Government

 

 

2014

2013

 

 

$’000

$’000

Appropriations:

 

 

 

Departmental appropriations

8,707

6,170

Total revenue from Government

8,707

6,170

 

 

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 Authority can access at measurement date.

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

Level 3: Unobservable inputs for the asset or liability.

Note 5A: Fair Value Measurements at the End of the Reporting Period by Hierarchy for Assets and Liabilities in 2014

 

 

 

 

 

Fair value measurements at the end of the reporting period using

 

 

 

 

Fair value

Level 1

Level 2

Level 3

 

 

 

 

 

inputs

inputs

inputs

 

 

 

 

$’000

$’000

$’000

$’000

Non-financial assets

Leasehold improvements

765

0

0

765

Property, plant and equipment

26

0

26

0

Total non-financial assets

791

0

26

765

Total fair value measurement of assets in the statement of financial position

 

 

 

 

791

0

26

765

 

Fair value measurements – highest and best use differs from current use for non-financial assets (NFAs)

The highest and best use of all non-financial assets are the same as their current use.

 

 

Note 5B: Level 1 and Level 2 Transfers for Recurring Fair Value Measurements

There were no transfers between Level 1 and level 2 during 2013–14.

The Authority’s policy for determining when transfers between levels are deemed to have occcurred can be found in Note 1.

Note 5C: Valuation Technique and Inputs for level 2 and Level 3 Fair Value Measurements

Level 2 and 3 fair value measurements – valuation techniques and the inputs used for assets and liabilities in 2014

 

Category Level 2 or 3

Fair value $’000

Valuation technique(s)1

Inputs used

Range (weighted ave)2

Non-financial assets

 

 

 

 

 

 

Leasehold improvements

level 3

765

Depreciation replacement cost

Cost per square metre

Approx $829 /m2

Property, Plant and equipment

level 2

26

Depreciation replacement cost

Sale price of comparable assets

N/A

 

1. No change in valuation technique occurred during the period
2. Significant unobservable inputs only. Not applicable for assets or liabilities in level 2 category.

Recurring and non-recurring level 3 fair value measurements – valuation processes.

The Authority intends conducting independant valuations every five years. In years where an independent valuation is not undertaken, an assessment is undertaken by management to ensure the fair value criterion is reasonable.

Recurring Level 3 fair value measurements – sensitivity of inputs.

Use of depreciable replacement costs. Fair value will only fluctuate with cost of replacement of assets, not expected to be significant.

Note 5D: Reconciliation for Recurring Level 3 Fair Value Measurements

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

 

 

Non-financial assets

 

 

Leasehold Improvements

Computer Software Assets

Total 2014

 

 

$’000

$’000

$’000

Opening Balance

1,009

102

1,111

Purchases

Sales

Depreciation

244

18

262

Closing Balance

 

765

84

849

 

The highest and best use of all non-financial assets are the same as their current use.

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

Note 6: Financial Assets

Note 6A: Cash and Cash Equivalents

 

2014

2013

 

$’000

$’000

Cash on hand or on deposit

16

96

Total cash and cash equivalents

16

96

 

 

 

 

Note 6B: Trade and Other Receivables

 

 

2014

2013

 

 

$’000

$’000

Goods and Services:

Goods and services – related parties

0

150

Goods and services – external parties

0

333

Total goods and services receivable

0

483

 

Appropriations receivable:

For existing programs

3,400

967

Total appropriations receivable

3,400

967

 

Other receivables:

GST receivable from the Australian Taxation Office

17

15

Total other receivables

17

15

Total trade and other receivables

3,417

1,465

 

Trade and other receivables are expected to be recovered in:

 

 

No more than 12 months

3,417

1,465

More than 12 months

0

0

Total trade and other receivables

3,417

1,465

 

 

 

 

Trade and other receivables are aged as follows:

Not overdue

3,417

1,455

Overdue by:

 

 

 

0 to 30 days

0

0

 

31 to 60 days

0

0

 

61 to 90 days

0

10

 

More than 90 days

0

0

Total trade and other receivables

3,417

1,465

 

 

 

 

The Authority’s credit terms

30 days

30 days

 

 

 

 

 

 

Note 7: Non-Financial Assets

Note 7A: Leasehold Improvements

 

2014

2013

 

$’000

$’000

Leasehold improvements

 

 

Fair value

1,224

1,224

Accumulated depreciation

(459)

(215)

Total leasehold improvements

765

1,009

 

 

 

No indicators of impairment were found for leasehold improvements.
No leasehold improvements are expected to be sold or disposed within the next 12 months.

Note 7B: Property, Plant and Equipment

 

2014

2013

 

$’000

$’000

Property, plant and equipment

 

 

Fair value

56

56

Accumulated depreciation

(30)

(8)

Total property, plant and equipment

26

48

 

 

 

No indicators of impairment were found for leasehold improvements.
No leasehold improvements are expected to be sold or disposed within the next 12 months.

Note 7C: Intangibles

 

 

2014

2013

 

 

$’000

$’000

Computer software

 

 

 

Cost

109

110

Accumulated amortisation

(25)

(7)

Total computer software

 

84

103

Total intangibles

 

84

103

 

No indicators of impairment were found for leasehold improvements.
No leasehold improvements are expected to be sold or disposed within the next 12 months.

Note 7D: Analysis of Property, plant and equipment and intangibles

 

 

Leasehold improvements

Property, plant & equipment

Computer software purchased

Total

 

 

$’000

$’000

$’000

$’000

As at 1 July 2013

 

1,009

48

103

1,160

Net book value

 

1,009

48

103

1,160

 

Additions:

 

 

 

 

 

By Purchase

0

0

0

0

Depreciation/Amortisation expense

(244)

(22)

(19)

(285)

Disposals

0

0

0

0

Total as at 30 June 2014

765

26

84

875

 

Total as at 30 June 2014 represented by

 

 

 

 

Gross book value

1,224

56

110

1,390

Accumulated depreciation/amortisation

(459)

(30)

(26)

(515)

Total as at 30 June 2014

765

26

84

875

 

As at 1 July 2012

 

Net book value

 

 

 

 

 

 

 

Additions:

 

 

 

 

 

By Purchase

0

20

59

79

From acquisition of entities or operations (including restructuring)

 

 

 

 

1,224

36

51

1,311

Depreciation/Amortisation expense

(215)

(8)

(7)

(230)

Disposals

 

0

0

0

0

Total as at 30 June 2013

1,009

48

103

1,160

 

 

 

 

 

 

Total as at 30 June 2013 represented by

 

 

 

 

Gross book value

 

1,224

56

110

1,390

Accumulated depreciation/amortisation

(215)

(8)

(7)

(230)

Total as at 30 June 2013

1,009

48

103

1,160

 

Note 7E: Other Non-Financial Assets

 

 

2014

2013

 

 

$’000

$’000

Prepayments

 

 

 

Rent and services in advance

48

0

Total prepayments

 

48

0

Total other non-financial assets

48

0

 

 

 

 

Total prepayments are expected to be recovered in:

 

 

 

No more than 12 months

48

0

More than 12 months

0

0

Total prepayments

 

48

0

 

Note 8: Payables

Note 8A: Suppliers

 

 

2014

2013

 

 

$’000

$’000

Trade creditors and accruals

 

44

500

Total supplier payables

 

44

500

 

 

 

 

Supplier payables expected to be settled with 12 months:

 

 

Related parties

0

228

External parties

44

272

Total suppliers payable

 

44

500

 

 

 

 

Settlement is usually made within 30 days.

Note 8B: Other Payables

 

 

2014

2013

 

 

$’000

$’000

Salaries and wages

 

88

107

Superannuation

 

14

16

Efficiency dividend payable

 

0

36

Lease liability

 

19

32

Net GST payable to ATO

 

41

3

Total other payables

 

162

194

 

 

 

 

Total other payables are expected to be settled in:

 

 

No more than 12 months

162

194

More than 12 months

0

0

Total other payables

 

162

194

 

 

 

 

Note 9: Provisions

Note 9: Employee Provisions

 

 

2014

2013

 

 

$’000

$’000

Leave

 

472

584

Total employee provisions

 

472

584

 

 

 

 

Employee provisions are expected to be settled in:

 

 

No more than 12 months

163

277

More than 12 months

309

307

Total employee provisions

 

472

584

 

Note 10: Cash Flow Reconciliation

 

 

2014

2013

 

 

$’000

$’000

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

 

 

 

Cash and Cash Equivalents as per:

 

 

Cash Flow Statement

16

96

Statement of Financial Position

16

96

Discrepancy

 

0

0

 

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

 

 

Net cost of services

(6,472)

(6,037)

Add revenue from Government

8,707

6,170

 

 

 

 

Adjustments for non-cash items

 

 

Depreciation/amortisation

285

230

 

Movement in assets/liabilities:

 

 

(Increase)/decrease in net receivables

(1,954)

(1,465)

(Increase)/decrease in prepayments

(48)

0

(Increase)/decrease in employee provisions

(112)

584

(Increase)/decrease in supplier payables

(456)

500

(Increase)/decrease in other payables

(31)

194

Net cash from/(used by) operating activities

(80)

176

 

 

 

 

Note 11: Contingent Assets and Liabilities

Significant Remote Contingencies.

CCA entered into an agreement that resulted in an accommodation and set-up subsidy that has been provided via a Memorandum of Understanding (MOU) with the Victorian Department of Business and Innovation. The MOU requires the Authority to continue to meet certain conditions through to 31 December 2015. The conditions are considered to be business as usual requirements and place no added impost on the Authority. The amount of liability connected to a refund event cannot be evaluated accurately. The possibility of a refund event occurring is considered highly unlikely.

Note 12: Senior Executive Remuneration

Note 12A: Senior Executive Remuneration Expenses for the Reporting Period

 

 

2014

2013

 

 

$’000

$’000

Short-term employee benefits:

 

 

Salary

595

483

Performance bonus

0

0

Total short-term employee benefits

595

483

 

 

 

 

Post-employment benefits

 

 

Superannuation

91

68

Total post-employment benefits

91

68

 

 

 

 

Other long-term employee benefits:

 

 

Annual leave accrued

108

62

Long service leave accrued

49

58

Total other long-term employee benefits

157

120

 

 

 

 

Termination benefits

 

 

Long service paid out

66

0

Total termination benefits

66

0

 

 

 

 

Total senior executive remuneration expenses

909

671

 

1. Note 12A includes SES and Members
2. Note 12A is prepared on an accrual basis
3. Note 12A excludes acting arrangements and part-year service where the total remuneration expensed as a senior executive was less than $195,000.

Note 12B: Average Annual Reportable Remuneration Paid to Substantive Senior Executives During the Reporting Period

2014

Average annual reportable remuneration

Senior Executives

Reportable Salary

Contributed Superannuation

Reportable Allowances

Total reportable remuneration

 

No.

$

$

$

$

Total remuneration

 

 

 

 

 

(Including part-time arrangements)

 

 

 

 

$195,000 to $224,999

2

201,230

22,397

125

223,752

$330,000 to $369,999

1

316,891

46,014

362,905

Total

3

 

 

 

 

 

2013

Average annual reportable remuneration

Senior Executives

Reportable Salary

Contributed Superannuation

Reportable Allowances

Total reportable remuneration

 

No.

$

$

$

$

Total remuneration

 

 

 

 

 

(Including part-time arrangements)

 

 

 

 

less than $195,000

1

127,421

18,826

146,247

$195,000 to $224,999

1

176,440

23,343

300

200,083

$330,000 to $369,999

1

291,754

44,500

50

336,304

Total

3

 

 

 

 

 

 

 

 

 

 

 

1. This table reports substantive senior executives who received remuneration during the reporting period

2. Reportable salary includes the following:
a) gross payments (no bonuses have been paid)
b) reportable fringe benefits (at the net amount prior to ‘grossing up’ for tax purposes)
c) exempt foreign employment income; and
d) salary sacrifice benefits

3. The contributed superannuation amount is the cost to the entity for the provision of superannuation benefits to substantive senior executives in the reporting period

4. Reportable allowances are the actual allowances paid as per the total allowances line in individuals’ payment summaries.

Note 12C: Average Annual Reportable Remuneration Paid to Other Highly Paid Staff During the Reporting Period

The Authority has no other highly paid staff with total reportable remuneration in excess of $195,000 for both financial years

Note 13: Authority Members Remuneration

2014

Average annual reportable remuneration

Authority members

Reportable Salary

Contributed Superannuation

Reportable Allowances

Total reportable remuneration

 

 

No.

$

$

$

$

Total remuneration

 

 

 

 

 

(Including part-time arrangements)

 

 

 

 

Chairman

1

53,559

5,821

9,370

68,750

Members

7

25,015

2,926

6,742

34,683

Total

8

 

 

 

 

 

2013

Average annual reportable remuneration

Authority members

Reportable Salary

Contributed Superannuation

Reportable Allowances

Total reportable remuneration

 

 

No.

$

$

$

$

Total remuneration

 

 

 

 

 

(Including part-time arrangements)

 

 

 

 

Chairman

1

58,953

5,306

64,259

Members

7

31,834

3,020

34,854

Total

 

8

 

 

 

 

 

Note: this is an additional disclosure and not required Finance Minister’s Orders Authority Members remuneration and sitting fees are set by Remuneration Tribunal Determinations

1. This table reports Authority members who received remuneration during the reporting period.

2. Each row is an averaged figure based on the headcount for individuals in that category

3. Reportable salary includes the following:
a) gross payments (no bonuses have been paid)
b) reportable fringe benefits (at the net amount prior to ‘grossing up’ for tax purposes)
c) exempt foreign employment income; and
d) salary sacrifice benefits

4. The contributed superannuation amount is the cost to the entity for the provision of superannuation benefits to substantive senior executives in the reporting period.

5. Reportable allowances are the actual allowances paid as per the total allowances line in individuals’ payment summaries.

Note 14: Remuneration of Auditors

 

 

2014

2013

 

 

$’000

$’000

Financial statement audit services were provided free of charge to the Authority by the Australian National Audit Office (ANAO).

 

 

 

 

 

 

Fair value services received

 

 

Financial statement audit services

50

50

Total fair value of services received

50

50

 

No other services were provided to the Authority by the ANAO.

Note 15: Financial Instruments

Note 15A: Categories of Financial Instruments

 

 

2014

2013

 

 

$’000

$’000

Financial Assets

 

 

 

Loans and receivables:

 

 

 

Cash and cash equivalents

16

96

Trade receivables

0

483

Total loans and receivables

16

579

 

 

 

 

Financial liabilities

 

 

 

At amortised cost:

 

 

 

Other liabilities

 

 

 

Payables – suppliers

44

327

Total financial liabilities measured at amortised cost

44

327

 

Note 16: Financial Assets Reconciliation

Note 16A: Net Gains and Losses Financial Assets

There is no income or expense from financial assets in the periods ended 30 June 2014 and 30 June 2013.

Note 16B: Net Gains and Losses Financial Liabilities

There is no income or expense from other financial liabilities in the periods ended 30 June 2014 and 30 June 2013.

Note 16C: Fair Value of Financial Instruments

There are no financial instruments held at 30 June 2014 and 30 June 2013 where the carrying amount is not a reasonable approximation of fair value.

Note 16D: Credit Risk

The Authority 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 of trade receivables. The Authority holds no trade receivables as at 30 June 2014 (2013: $483,000). There is therefore no current credit risk.

Note 16F: Liquidity Risk

The Authority’s financial liabilities are payables. The exposure to liquidity risk is based on the notion that the Authority will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to appropriation funding and mechanisms available to the Authority (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 Authority is appropriated funding from the Australian Government. The Authority manages its budgeted funds to ensure it has adequate funds to meet payments as they fall due. In addition, the Authority has policies in place to ensure timely payments are made when due and has no past record of default.

All financial liabilities for 2014 and 2013 mature within one year.

The Authority has no derivative financial liabilities in either the current or prior year.

Note 16G: Market Risk

The Authority holds basic financial instruments that do not expose the Authority to market risks.

The Authority is not exposed to currency risk, price risk or interest rate risk.

Note 16H: Financial Assets Reconciliation

 

 

2014

2013

 

 

$’000

$’000

Financial Assets

 

 

 

Total financial assets per statement of financial position

3,434

1,561

Less: non-financial instrument components:

 

 

Appropriations receivable

3,401

967

GST Receivable from the Australian Taxation Office

17

15

Total non-financial instruments components

3,418

982

Total financial assets as per financial instrument note

16

579

 

Note 17: Appropriations

Table A: Annual Appropriations (‘Recoverable GST’ Exclusive)

 

 

 

2014 Appropriations

 

 

 

 

Appropriation Act

FMA Act

 

 

 

 

 

Annual Appropriation

Appropriation Reduced

Section 30

Section 31

Total Appropriation

Appropriation applied in 2014 (current and prior years)

Variance

 

 

$’000

$’000

$’000

$’000

$’000

$’000

$’000

Departmental

 

 

 

 

 

 

 

 

Ordinary annual services

8,707

36

0

348

9,019

6,665

2,354

Other services

0

0

0

0

0

0

0

Total departmental

 

8,707

36

0

348

9,019

6,665

2,354

 

 

 

 

 

 

 

 

 

  •  
  • (a) Appropriations reduced under Appropriation Acts (No.1,3,5) 2013–14: sections 10, 11 and 12 and under Appropriation Acts (No.2,4,6) 2013–14: sections 12,13 and 14. The reduction was in respect of savings measures for 2012–13 but only effected in 2013–14.
  • (b) Unapplied 2013–14 appropriations will be applied to meeting the future settlement of current period expenses and provisions and to meet current operations in the absence of a 2014–15 appropriation.
  • (c) The balance of unapplied 2013–14 appropriations has resulted from an underspend which is a consequence of a reduced staffing complement in the second half of 2013–14 linked to the announcement of the potential abolition of the Authority. At reporting date the Authority is applying carry forward funds to meet its operational needs.

Table A: Annual Appropriations (‘Recoverable GST’ Exclusive)

 

 

2013 Appropriations

 

 

 

 

Appropriation Act

FMA Act

 

 

 

 

 

Annual Appropriation

Appropriation Reduced

Section 30

Section 31

Total Appropriation

Appropriation applied in 2013 (current and prior years)

Variance

 

 

$’000

$’000

$’000

$’000

$’000

$’000

$’000

Departmental

 

 

 

 

 

 

 

 

Ordinary annual services

6,206

0

0

105

6,311

5,344

967

Other services

0

0

0

0

0

0

0

Total departmental

 

6,206

0

0

105

6,311

5,344

967

 

 

 

 

 

 

 

 

 

 

  •  
  • (a) Appropriations reduced under Appropriation Acts (No.1,3,5) 2012–13: sections 10, 11 and 12 and under Appropriation Acts (No.2,4,6) 2012–13: sections 12, 13 and 17. Departmental appropriations do not lapse at financial year-end. However, the responsible Minister may decide that part or all of a departmental appropriation is not required and request that the Finance Minister reduce that appropriation. The reduction in the appropriation is effected by the Finance Minister’s determination and is disallowable by Parliament.
  • (b) Unapplied 2012–13 appropriations will be applied to meeting the future settlement of current period expenses and provisions. As at 30 June the employee provisions balance is $584,000, salary accrual $117,000 and net creditor accruals $250,000.

Table B: Unspent Departmental Annual Appropriations (Recoverable GST exclusive)

 

 

2014

2013

 

 

$’000

$’000

Appropriation Act (No.1) 2012–13

931

967

Appropriation Act (No.1) 2013–14

2,470

 

Total departmental appropriation as at 30 June

3,401

967

 

Note 18: Compensation and Debt Relief

 

 

 

2014

2013

 

 

 

$’000

$’000

Departmental

No ‘Act of Grace’ payments were expensed during the reporting period.

 

 

0

0

No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997.

 

 

 

 

0

0

No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period.

 

 

 

 

 

 

No ex gratia payments were provided for during the reporting period.

 

 

0

0

No payments were provided in special circumstances relating to APS employment pursuant to section 73 of the Public Service Act 1999 (PS Act) during the reporting period.

 

 

 

 

0

0

 

Note 19: Reporting of Outcomes

Note 19A: Net Cost of Outcome Delivery

 

 

Outcome 1

2014

Outcome 1

2013

 

 

$’000

$’000

Departmental

 

 

 

Expenses

 

6,522

6,403

 

 

 

 

Other own-source income

 

50

366

 

 

 

 

Net cost of outcome delivery

6,472

6,037

 

During 2012–13 additional legal advice was received that indicated there could be breaches of Section 83 under certain circumstances with payments for long service leave, goods and services tax and payments under determinations of the Remuneration Tribunal. The Authority has reviewed its processes and controls over payments for these items to minimise the possibility for future breaches as a result of these payments. The Authority has determined that there is a low risk of the certain circumstances mentioned in the legal advice applying to the department. The Authority is not aware of any specific breaches of Section 83 in respect of these items.

The 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 (2012) 288 ALR 410, 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.

Note 20: Net Cash Appropriation Arrangements

 

2014

2013

 

$’000

$’000

Total comprehensive income less depreciation/amortisation expenses previously funded through revenue appropriations1

1,950

363

Plus: depreciation/amortisation expenses previously funded through revenue appropriation

285

230

Total comprehensive income – as per the Statement of Comprehensive Income

2,235

133

 

 

 

 

1 From 2010–11, the Government introduced net cash appropriation arrangements, where revenue appropriations for depreciation/amortisation expenses ceased. Entities now receive a separate capital budget provided through equity appropriations. Capital budgets are to be appropriated in the period when cash payment for capital expenditure is required.