Statement 11:  Government Finance Statistics Statements
Contents
Government finance statistics statements	11-5

Statement 11:  Government Finance Statistics Statements
The financial tables presented in this Statement are prepared in accordance with the Australian Bureau of Statistics (ABS) accrual Government Finance Statistics (GFS) framework.
The statistical tables that are presented below include an operating statement, balance sheet and cash flow statement for the Commonwealth general government, public non‑financial corporations (PNFC) and total non‑financial public sectors. The 2002‑03 Budget also includes a statement of other economic flows for the Commonwealth general government sector. This primarily outlines how ‘other economic flows’ (that is, those flows not accounted for in the GFS operating statement) impact on the net worth of the Commonwealth general government sector.
The Commonwealth, States and Territories have an agreed framework — the Accrual Uniform Presentation Framework (UPF) — for the presentation of government financial information on a basis consistent with the ABS Government Finance Statistics (GFS) publication. This Statement presents Commonwealth data on an ABS GFS basis, as required by the UPF. An exception to this is the treatment of provisions for bad and doubtful debts. The draft ABS GFS publication (Australian System of Government Finance Statistics: Concepts, Sources and Methods Cat. No. 5514.0) requires that provisions for bad and doubtful debts be excluded from the balance sheet. This treatment has not been adopted because excluding such provisions would overstate the value of Commonwealth assets and net worth in the balance sheet (and would therefore be inconsistent with the market valuation principle).
The clear policy intent of the Intergovernmental Agreement on Commonwealth‑State Financial Arrangements is that GST is collected by the Commonwealth, as an agent for the States and Territories, and appropriated to the States. As such, it is not shown as Commonwealth revenue in other statements in this document. However, the tables in this Statement are presented on an accrual UPF reporting basis, and show GST as taxation revenue in and payments to the States as grant expenses out.
As a result of the two different treatments of GST related transactions, the fiscal balance, net operating balance and net worth estimates in this Statement are higher than those reported elsewhere in this document. This represents GST revenue accrued but not yet received, and therefore not yet paid or payable to the States (as GST obligations to the States are on a cash basis). However, under the State tax treatment applied elsewhere in this document, GST revenue accrued is offset by an equivalent amount payable to the States (increasing expenses and liabilities relative to the 

estimates in this Statement). This accounting difference is an accrual issue only:  the underlying cash balance is not affected and provides identical results under both treatments of GST revenue.
Consistent with ABS practice, transactions between the Commonwealth general government and PNFC sectors are included in the tables produced for these sectors, but are removed from the total non‑financial sector tables as they are transactions internal to that sector.
Budget Statement 10 provides an explanation of the key GFS aggregates and reconciles them with their Australian Accounting Standard No. 31 (AAS31) counterparts.

Government finance statistics statements
Table 1:  Commonwealth general government sector operating statement

(a)	Since MYEFO, GST administration costs paid by the States and small agency revenue from the sale of goods and services has been reclassified from ‘Other’ to ‘Sales of goods and services’.
(b)	The fiscal balance and net operating balance estimates in this table are higher than those presented elsewhere in the Budget, as explained on page 11‑3.
(c)	The term ‘fiscal balance’ is not used by the ABS.
Table 2:  Commonwealth general government sector balance sheet

(a)	Net worth is calculated as total assets minus total liabilities.
(b)	The net worth estimates in this table are higher than those presented elsewhere in the Budget, as explained on page 11‑3.
(c)	Net financial worth equals total financial assets minus total liabilities.
(d)	Net debt equals the sum of deposits held, advances received, government securities, loans and other borrowings, minus the sum of cash and deposits, advances paid, and investments, loans and placements.

Table 3:  Commonwealth general government sector cash flow statement(a)

(a)	A positive number denotes a cash inflow; a negative sign denotes a cash outflow.
(b)	GST flows are excluded from these categories they are intra‑sector transactions.
(c)	Since MYEFO, GST administration costs paid by the States and small agency receipts from the sale of goods and services has been reclassified from ‘Other receipts’ to ‘Receipts from the sale of goods and services’.
(d)	The acquisition of assets under finance leases reduces the surplus/deficit. The disposal of assets previously held under finance leases improves the surplus/deficit.
Table 4:  Commonwealth general government sector statement of other economic flows (reconciliation of net worth)

(a)	This component of profit on the sale of assets impacts on net worth as an operating transaction (rather than an other economic flow) and is therefore added back to the net profit on sales of assets.
(b)	Revaluations and profit on sale of assets are derived from Australian Accounting Standards (AAS) data. The downward revaluation of investments in commercial entities in 2003‑04, 2004‑05 and 2005‑06 reflects the difference between the GFS valuation of commercial entities at market value and the AAS valuation at historic cost. The net profit on sale of assets primarily represents the amount by which the projected sales proceeds exceed the AAS valuation. Thus, the sum of revaluations and cost of asset sales better reflects the impact of these transactions as other economic flows under the GFS accounting framework than each of the individual components.
(c)	Total grants to be paid over a multi‑year health programme were previously recognised as an expense and liability in the year that the programme began. This treatment has been reversed and the grants will now be recognised as expenses in the year they are paid, leading to the removal of the previous liability, consistent with external reporting standards.
(d)	Includes assets recognised for the first time, net repurchase premia and other revaluations not recorded elsewhere.

Table 5:   Commonwealth public non‑financial corporations 
operating statement

(a)	The term ‘fiscal balance’ is not used by the ABS.

Table 6:  Commonwealth public non‑financial corporations balance sheet 

(a)	Net worth is calculated as total assets minus total liabilities minus shares and other contributed capital. The negative net worth recorded for this sector reflects a higher valuation of listed Commonwealth corporations by the sharemarket than the value of net assets recorded by these corporations.
(b)	Net financial worth equals total financial assets minus total liabilities minus shares and other contributed capital.
(c)	Net debt equals the sum of deposits held, advances received and borrowing, minus the sum of cash and deposits, advances paid, and investments, loans and placements.

Table 7:  Commonwealth public non‑financial corporations 
cash flow statement(a)

(a)	A positive number denotes a cash inflow; a negative sign denotes a cash outflow.
(b)	‘Other payments for operating activities’ includes the cash flow to the general government sector from PNFC distributions paid.
(c)	‘Distributions paid’ comprise PNFC dividends to external shareholders.
(d)	The acquisition of assets under finance leases reduces the surplus/deficit. The disposal of assets previously held under finance leases improves the surplus/deficit.
Table 8:  Commonwealth total non‑financial public sector 
operating statement

(a)	The fiscal balance and net operating balance estimates in this table are higher than those presented elsewhere in the Budget, as explained on page 11‑3.
(b)	The term ‘fiscal balance’ is not used by the ABS.

Table 9:  Commonwealth total non‑financial public sector balance sheet

(a)	Net worth is calculated as total assets minus total liabilities minus shares and other contributed capital.
(b)	The net worth estimates in this table are higher than those presented elsewhere in the Budget, as explained on page 11‑3.
(c)	Net financial worth equals total financial assets minus total liabilities minus shares and other contributed capital.
(d)	Net debt equals the sum of deposits held, advances received, government securities, loans and other borrowings, minus the sum of cash and deposits, advances paid, and investments, loans and placements.

Table 10:  Commonwealth total non‑financial public sector
cash flow statement(a)

(a)	A positive number denotes a cash inflow; a negative sign denotes a cash outflow.
(b)	GST flows are excluded from these categories they are intra‑sector transactions. 
(c)	‘Distributions paid’ comprise PNFC dividends to external shareholders.
(d)	The acquisition of assets under finance leases reduces the surplus/deficit. The disposal of assets previously held under finance leases improves the surplus/deficit.
Table 11:  Commonwealth general government sector taxation revenue 
by source

The UPF also requires the publication of data on general government sector expenses by function. The data are not shown in this Statement, as they have been published in Budget Statement 6. However, the data in Statement 6 treat the GST as a State tax, and hence exclude GST payments to the States.