Australian Office of Financial management
Section 1:  Overview, additional estimates and variations to outcomes 
Overview
There has been no change to the overview included in the 2000-01 Portfolio Budget Statements.
Additional estimates and variations to outcomes
Measures
The Australian Office of Financial Management (AOFM) has no additional measures since the 2000-01 Portfolio Budget Statements.
Other variations to appropriations
The AOFM will be returning a saving of $0.749 million. This saving is a result of the withdrawal of the AOFM’s agency loan. The loan was to be repaid over seven years and was to be drawn on for the acquisition of leasehold improvements. Agency cash reserves will now be used to fund this acquisition. It should be noted that the change to the estimates will not affect the capacity of the AOFM to deliver its outcome and output.
The variation in the AOFM’s net annotated appropriations (Section 31) receipts (see Table 1.5) is as a result of the review of offsetting arrangements under the Agency Banking Incentive Scheme. The new estimate of interest earnings for the AOFM is $20,000.

Chart 4:  Australian Office of Financial Management outcomes and outputs 
	Australian Office of Financial Management
Chief Executive Officer:  Michael Allen		
							
	Overall Government Outcome
Strong, sustainable economic growth and the improved wellbeing of Australians.		
							
	Outcome 1
To enhance the Commonwealth’s capacity to manage its net debt portfolio, offering the prospect of savings in debt servicing costs and an improvement in the net worth
of the Commonwealth over time.
Total Price of Outputs:  $5.7 million
Total Administered Expenses:  $9,442.5 million		
							
	Output 1.1
Debt Management
Total Price of Output 1:  $5.7 million
Total Administered Expenses:  $9,442.5 million		

Breakdown of additional estimates by appropriation bill
Table 1.2:  Appropriation Bill (No. 3) 2000‑01

Table 1.3:  Appropriation Bill (No. 4) 2000‑01

Summary of agency savings

The saving of $0.749 million represents the withdrawal of the AOFM’s agency loan in  2000-01. 
Variations to revenue from other sources through net annotated appropriations (section 31) receipts
Table 1.5:  Changes to net annotated appropriations (section 31) receipts

Section 2:  Revisions to outcomes and outputs
Outcomes and output groups
The AOFM has not made any changes to its outcome or output since the 2000-01 Portfolio Budget Statements.
Revised performance information and level of achievement — 2000‑01
The performance information for Outcome 1 is unchanged from the 2000-01 Portfolio Budget Statements.

Section 3:  Budgeted financial statements
Budget statement of revenues and expenses 
This statement provides a picture of the expected financial results for the AOFM by identifying full accrual expenses and revenues.
Budget statement of assets and liabilities 
This statement shows the financial position of the AOFM. It enables decision-makers to track the management of the agency’s assets and liabilities.
Budget cash flow statement
This statement provides information on the extent and nature of budgeted cash flows, categorised into expected cash flows from operating activities, investing activities and financing activities.
Capital budget statement
This statement shows all proposed capital expenditure on non‑financial assets, whether funded either through capital appropriations (equity or borrowings) or from internally sourced funds.

Table 3.1:  Budget statement of revenues and expenses

Table 3.2:  Budget statement of assets and liabilities (Agency)

Table 3.2:  Budget statement of assets and liabilities (Administered)

Table 3.3:  Budget cash flow statement (Agency)

Table 3.3:  Budget cash flow statement (Administered)

Table 3.4:  Capital budget statement

Notes to the financial statements
Basis of accounting
The budget statements are prepared in compliance with Australian Accounting Standards, Accounting Guidance Releases and having regard to Statements of Accounting Concepts.
Budget statement of revenues and expenses
Agency
Revenue from government
Price of outputs appropriation estimates are not based on market price indicators. Currently, the agreed price of outputs appropriation estimates are based on budgeted expenses.
The AOFM has prepared its estimates for the 2000-01 budget and forward years to achieve a break-even operating result. Consequently the appropriation revenue from Government represents the funding required to meet all expenses after deduction of revenue from other sources.
Revenue from other sources 
As part of the review of the agency banking incentive scheme, the AOFM has estimated that it will earn interest on credit balances in its agency account and from term deposit investments of $20,000 in each of the budget years.
Administered
Interest
	Actual	Revised Budget	Estimated	
	1999-00
$’000	2000-01
$’000	2001-02
$’000	2002-03
$’000	2003-04
$’000	
Interest on housing agreements	175,152	172,262	169,249	166,110	162,852	
Interest on state and territory debt	122,006	50,213	35,285	30,999	19,539	
Interest from other sources	2,244,350	2,770,419	3,496,328	4,555,723	5,596,916	
Total interest	2,541,508	2,992,894	3,700,862	4,752,832	5,779,307	

Interest from other sources includes interest from swaps and investments.
Appropriations
This represents estimated appropriations, comprising annual and special appropriations, to:
•	meet administered expenses relating to debt management outcome; and
•	undertake redemption of Commonwealth government securities.
Cash transfers to/from DoFA
This represents estimated administered receipts, such as proceeds from debt raising, swap interest and principal and interest on housing agreement loans that are to be passed to the Commonwealth’s Official Public Account.
Grants
	Actual	Revised Budget	Estimated	
	1999-00
$’000	2000-01
$’000	2001-02
$’000	2002-03
$’000	2003-04
$’000	
Grants to State and Territory Governments	64,635	56,644	45,556	29,916	35,337	
Total grants	64,635	56,644	45,556	29,916	35,337	

Interest and financing costs
	Actual	Revised Budget	Estimated	
	1999-00
$’000	2000-01
$’000	2001-02
$’000	2002-03
$’000	2003-04
$’000	
Interest on Government securities	6,391,697	5,682,038	5,140,781	4,980,070	4,553,030	
Interest on swaps	1,834,338	2,553,804	2,702,501	2,824,136	2,794,749	
Interest on other debt	56,234	66,787	53,380	34,523	12,690	
Net repurchase premia	101,952	266,990	46,720	-	-	
Other financing costs	-	5,142	4,013	3,913	3,913	
Total interest and financing costs	8,384,221	8,574,761	7,947,395	7,842,642	7,364,382	

Budget statement of assets and liabilities
Agency
The employee liabilities of the AOFM are expected to increase from the levels at 30 June 2000. The increased liability recognises that staff numbers are expected to grow significantly during the 2000-01 budget year and that a proportion of staff will be transferring liabilities from other Commonwealth agencies.
Estimated cash holdings and investments are expected to decrease significantly during the 2000-01 financial year from levels at 30 June 2000. The AOFM will undertake fit-out acquisition and will be returning, by way of dividend, $1.150 million of unspent appropriation moneys to the Official Public Account in 2000-01. Thereafter, the AOFM will be maintaining cash reserves for future settlement of employee liabilities and future asset replacement. 
The previously appropriated loan of $0.749 million to fund the acquisition of fit-out has been withdrawn. Cash holdings will now be used to fund the acquisition.
Administered
Debt — Government securities
Government securities debt represents the book value of Government securities liability, net of investments, with exception to 1999-2000, where they are reported separately.
Other debt
	Actual	Revised Budget	Estimated	
	1999-00
$’000	2000-01
$’000	2001-02
$’000	2002-03
$’000	2003-04
$’000	
Swap principal	2,164,760	2,765,732	2,007,712	1,558,260	896,132	
Total other debt	2,164,760	2,765,732	2,007,712	1,558,260	896,132	

Other provisions and payables 
	Actual	Revised Budget	Estimated	
	1999-00
$’000	2000-01
$’000	2001-02
$’000	2002-03
$’000	2003-04
$’000	
Interest payable	2,726,274	2,837,972	2,885,983	3,001,014	2,987,598	
Payable to DoFA	9,200,000	-	-	-	-	
Total other provisions and payables	11,926,274	2,837,972	2,885,983	3,001,014	2,987,598	

 Receivables
	Actual	Revised Budget	Estimated	
	1999-00
$’000	2000-01
$’000	2001-02
$’000	2002-03
$’000	2003-04
$’000	
Loans to State and Territory Governments	5,074,441	4,517,106	4,291,933	4,180,148	3,803,329	
Appropriations receivable	3,222,785	3,380,548	3,428,913	3,530,293	3,473,993	
Swap principal	32,718	57,853	57,853	57,853	-	
Total receivables	8,329,944	7,955,507	7,778,699	7,768,294	7,277,322	

Appendix 1
Estimates of agency and administered revenue

Appendix 2
Estimates of administered expenses from annual and special appropriations