Section 5: Budgeted financial statements
The budgeted financial statements contain estimates prepared in accordance with the requirements of the government’s financial budgeting and reporting framework, and the Australian Equivalents to International Financial Reporting Standards (AEIFRS), as well as specific guidelines issues by the Department of Finance and Administration. They show the planned financial performance for the 2007-08 Budget year and each of the forward years from 2008-09 to 2010-11. The statements also include the estimated actual for 2006-07 for comparative purposes.
5.1 Analysis of budgeted financial statements
An analysis of the Australian Competition and Consumer Commission’s (ACCC) budgeted financial statements, as reflected in the budgeted departmental financial statements and administered schedules for 2007-08, is provided below.
Departmental
Income statement
The ACCC is budgeting for a break even result for 2007-08. The estimated actual operating result for 2006-07 is a break even result also.
Operating revenues
Total revenue in 2007-08 is estimated to be $114.4 million, an increase of $6.3 million from the 2006-07 estimated actual. The increase is primarily as a result of the net increase in funding from measures disclosed in the 2006-07 Budget for the Australian Energy Regulator (AER) in the 2007-08 forward year.
Operating expenses
Total expenses are estimated to be $114.4 million. This is an increase of $6.3 million from the 2006-07 estimated actual. The increase is primarily due to the full year impact in 2007-08 of the initiatives funded in 2006-07 for the AER.
Balance sheet
The ACCC budgeted net asset position of $39.0 million is unchanged from the 2006-07 estimated actual.
The ACCC’s primary liability continues to be accrued employee leave entitlements of $13.9 million. The liability is expected to increase by around $0.7 million during 2007-08.
5.2 Budgeted financial statements tables
Table 5.1: Budgeted departmental income statement
(for the period ended 30 June)
Table 5.2: Budgeted departmental balance sheet (as at 30 June)
Table 5.3: Budgeted departmental statement of cash flows
(for the period ended 30 June)
Table 5.4: Departmental statement of changes in equity — summary of movement
(Budget year 2007-08)
Table 5.5: Departmental capital budget statement
Table 5.6: Departmental property, plant, equipment and intangibles — summary of movement (Budget year 2007-08)
Table 5.7: Schedule of budgeted income and expenses administered on behalf
of government (for the period ended 30 June)
Table 5.8: Schedule of budgeted assets and liabilities administered on behalf
of government (as at 30 June)
Table 5.9: Schedule of budgeted administered cash flows
(for the period ended 30 June)
Table 5.10: Schedule of administered capital budget
The ACCC does not have any administered capital.
Table 5.11: Schedule of administered property, plant, equipment and intangibles — summary of movement
(Budget year 2007-08)
The ACCC does not have any administered property, plant, equipment or intangible assets.
5.3 Notes to the financial statements
Accounting policy
The budgeted financial statements have been prepared on an accrual accounting basis, having regard to Statements of Accounting Concepts, and in accordance with:
- the Finance Minister’s Orders;
- Australian Equivalents to International Financial Reporting Standards (AEIFRS);
- other authoritative pronouncements of the Australian Accounting Standards Board; and
- the Consensus Views of the Urgent Issues Group.
Departmental and administered items
Agency assets, liabilities, revenues and expenses are those items that are controlled by the ACCC that are used by the ACCC in producing its outputs and include:
- computers, plant and equipment, and building fitout used in providing goods and services;
- liabilities for employee entitlements;
- revenue from appropriations or independent sources in payment for outputs; and
- employee, supplier and depreciation expenses incurred in providing agency outputs.
Administered items are those items incurred in providing programmes that are controlled by the Government and managed, or oversighted, by the ACCC on behalf of the Government. Administered revenues include fees and fines.
Departmental revenue
Revenue from Government represents the purchase of outputs from the ACCC by the Government and is recognised to the extent that it has been received into the ACCC’s bank account.
Revenue from other sources, representing sales from goods and services, is recognised at the time that it is imposed on customers.
Departmental expenses — employees
Payments and net increases in entitlements to employees for services rendered in the financial year.
Departmental expenses — suppliers
Payments to suppliers for goods and services used in providing agency outputs.
Departmental expenses — depreciation and amortisation
Depreciable property plant and equipment, buildings and intangible assets are written-off to their estimated residual values over their estimated useful life, using the straight-line calculation method.
Departmental assets — financial assets
The primary financial asset relates to receivables. Financial assets are used to fund the ACCC’s capital programme, employee entitlements, creditors and to provide working capital.
Departmental assets — non-financial assets
These items represent future benefits that the ACCC will consume in producing outputs. The reported value represents the purchase paid less depreciation incurred to date in using the asset.
Departmental liabilities — provisions and payables
Provision has been made for the ACCC’s liability for employee entitlements arising from services rendered by employees. This liability includes unpaid annual leave and long service leave. No provision has been made for sick leave because the level of sick leave is less on average than the amount which employees are entitled to each year.
Provision has also been made for unpaid expenses as at balance date.