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Notes to the financial statements

Basis of accounting

The agency budgeted statements are prepared in compliance with Australian Accounting Standards, Accounting Guidance Releases and having regard to Statements of Accounting Concepts. No allowance is made for the effect of changing prices on the results or the financial position of the AOFM.

Administered internal transactions

Administered transactions between the AOFM and other agencies within the general government (administered internal transactions) are not reported in the note of budgeted administered financial performance or the note of budgeted administered financial position.

Cash flows in the note of budgeted administered cash flows are reported inclusive of administered internal transactions.

Goods and Services Tax (GST)

The AOFM is an input taxed entity under A New Tax System (Goods and Services Tax) Act 1999.

The budgeted financial statements have been prepared in accordance with the GST accounting guidelines of the Urgent Issues Group (UIG) of the Australian Accounting Research Foundation. The UIG consensus requires that expenses and assets be accounted for net of recoverable GST, revenues be accounted for net of GST payable and that cash flows and accounts payable and receivable be reported gross. Appropriations are net of recoverable GST amounts.

Agency budgeted financial statements

Revenue and expenses

Appropriations

Price of outputs appropriation estimates are not based on market price indicators. The agreed price of outputs appropriation estimates are based on budgeted expenses.

The AOFM has prepared its estimates for the 2001-02 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.

Interest revenue

As part of the agency banking incentive scheme, the AOFM has estimated that it will earn $20,000 interest on credit balances in its agency account and from term deposit investments.

Employee expenses

The AOFM envisages a significant increase in its staffing over the Budget year 2001-02.

Assets and liabilities

The employee liabilities of the AOFM are expected to increase from actuals as at 30 June 2001. The increased liability recognises that staff numbers are expected to grow significantly during the Budget year 2001-02.

The estimated cash reserves will be maintained in order to ensure that the AOFM is well placed to:

• settle employee liabilities as they fall due;
• make asset replacements; and
• repay liabilities.

Budgeted financial statements have been prepared on the assumption that unspent monies will not be withdrawn by the Department of Finance and Administration.

Administered notes of budgeted financial statements

Revenue and expenses

Non-Taxation Revenue - Interest

Interest from other sources includes interest from swaps and investments.

Expenses - Grants

Expenses - Interest and Financing Costs

Assets and liabilities

Debt Liabilities - Loans

Loans represent the book value of Government securities on issue, net of investments, with exception to 2000-01, where they are reported separately.

Financial Assets - Receivables

Appendices 1 and 2

Appendix 1

Agency and administered revenue

Appendix 2

Estimates of expenses from administered appropriations