PART C - AGENCY BUDGET STATEMENTS -DEPARTMENT OF VETERANS' AFFAIRS

SECTION 3 - BUDGETED FINANCIAL STATEMENTS

The budgeted financial statements will form the basis of the financial statements that will appear in the Department of Veterans' Affairs 2003-04 Annual Report, and form the basis for the input into the Whole of Government Accounts. The statements are prepared consistent with GST accounting requirements, as outlined by the Urgent Issues Group (UIG) of the Australian Accounting Standards Board. The UIG Abstract 31 requires that expenses and assets be accounted for net of recoverable GST, revenues be accounted for net of GST payable and that cash flows, accounts payable and receivable are reported as gross amounts.

ANALYSIS OF BUDGETED FINANCIAL STATEMENTS

Departmental (DVA excluding Defence Service Homes Insurance Scheme (DSHIS))

Statement of Financial Performance

The Department (excluding DSHIS) is budgeting for an operating loss of $0.6m in 2003-04, this represents a $2.9m improvement on the estimated actual operating loss for 2002-03 of $3.5m. This improved operating result is driven by a $0.9m increase in revenue, offset by a $3.1m increase in expenses and the discontinuation of the CUC charge from 2003-04 ($5.1m).

The net increase in revenue of $0.9m is explained by a reduction in non-taxation revenue of $3.7m, offset by increased appropriations of $4.6m. The reduced non-taxation revenue is mainly a result of the expected decline in revenue for the F111 Health Scheme, the sale of nominal rolls relating to atomic test participants, and the Study of Health Outcomes in Aircraft Maintenance Personnel (SHOAMP) project. The main drivers of the increase in appropriation revenue are supplementation for superannuation expense increases ($2.9m) and the 2003-04 budget measures ($3.8m).

Total expenses are estimated to be $275.4m, representing an increase of $3.2m from the estimated actual for 2002-03. This is attributable to increased employee expenses related to 2003-04 budget measures, increases for superannuation and Comcare expenses and increased depreciation & amortisation due to further investment in non-financial assets (see below), offset by a reduction in supplier expenses.

Statement of Financial Position

The Department's budgeted net asset (equity) position for 2003-04 is $50.4m, which represents an increase of $3.9m from the estimated actual for 2002-03. This increase is mainly attributable to further investment in intangible assets (computer software) and infrastructure, plant and equipment ($11.7m), a $1.0m decrease in employee provisions, offset by a reduction in cash of $8.8m attributable to the increased investment, which will be funded from cash reserves.

Administered Notes

Budgeted Revenue and Expenses

The Department will receive appropriation revenue of $9,697m in 2003-04 for payments it will administer on behalf of the Government representing an increase of $453m over the estimated actual for 2002-03. The increase is largely due to changes in costs, client numbers and the number of services provided.

Budgeted Assets and Liabilities

Total Assets and Total Liabilities are expected to increase by $30m to $486m and $411m, respectively in 2003-04 from the 2002-03 estimated actual due to the increase in appropriations receivable to offset the increase in personal benefits payable. This is consistent with the increase in personal benefit expenses for the same period.

Departmental Statements

Budgeted Departmental Statement of Financial Performance

This statement presents the expected financial results for the Department by identifying full accrual expenses and revenues and capital use charge. These statements highlight whether the Department is operating at a sustainable level in the short term. The following statements have been presented:

Budgeted Departmental Statement of Financial Performance (Amalgamated);

Budgeted Departmental Statement of Financial Performance (DVA, excluding DSHI); and

Budgeted Departmental Statement of Financial Performance (Defence Service Homes Insurance Scheme).

Budgeted Statement of Financial Position

This Statement shows the expected financial position of the Department and whether its financial strength is likely to improve or worsen over time. It enables decision-makers to track the management of the Department's assets and liabilities and, in conjunction with information on forecast cash flows, determine whether the Department is financially viable in the long term. The following statements have been presented:

Budgeted Departmental Statement of Financial Position (Amalgamated);

Budgeted Departmental Statement of Financial Position (DVA, excluding DSHI); and

Budgeted Departmental Statement of Financial Position (Defence Service Homes Insurance Scheme).

Budgeted Statement of Cash Flow

This Statement provides important information on the extent and nature of cash flows by categorising them into expected cash flows from operating activities, investing activities and financing activities. The following statements have been presented:

Budgeted Departmental Statement of Cash Flow (Amalgamated);

Budgeted Departmental Statement of Cash Flow (DVA, excluding DSHI); and

Budgeted Departmental Statement of Cash Flow (Defence Service Homes Insurance Scheme).

Departmental Capital Budget Statement

The Capital Budget shows proposed capital expenditure funded either by Budget appropriations or from internal sources.

Departmental Non-financial Assets (Summary of Movement)

Shows budgeted acquisitions and disposals of non-financial assets during the budget year.

Administered Schedules

Schedule of Budgeted Revenues and Expenses Administered on behalf of Government

Schedule of Budgeted Assets and Liabilities Administered on behalf of Government

Schedule of Budgeted Administered Cash Flows

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Table 3.1A - Budgeted Departmental Statement of Financial Performance (Amalgamated) for the period ended 30 June

			Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
		Note	2002-2003	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
REVENUE FROM ORDINARY ACTIVITIES
Revenue from Government
Ordinary Annual Appropriations			255,230	259,755	266,079	272,577	281,433
Resources received free of charge			380	388	396	403	411
Sub-total			255,610	260,143	266,475	272,890	281,844
Revenue from Independent Sources
Sale of Goods & Services		2	37,623	34,363	33,218	33,087	33,411
Interest			3,948	3,200	3,300	3,400	3,400
Sub-total			41,571	37,563	36,518	36,487	36,811
Total Revenue from Ordinary Activities			297,181	297,706	302,993	309,467	318,655
EXPENSES FROM ORDINARY ACTIVITIES
Employees		3	151,587	155,886	162,505	163,992	167,656
Suppliers			116,069	111,224	106,047	108,930	112,088
Depreciation & Amortisation			10,803	14,601	17,039	19,098	21,829
Other goods and services expenses			14,850	14,400	14,400	13,900	13,900
Total Expenses from Ordinary Activities			293,309	296,111	299,991	305,920	315,473
Operating Surplus (deficit) from Ordinary Activities			3,872	1,595	3,002	3,547	3,182
Capital Use Charge			5,085	0	0	0	0
Net surplus (deficit) after Capital Usage Charge and Extraordinary items			(1,213)	1,595	3,002	3,547	3,182

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Table 3.1B - Budgeted Departmental Statement of Financial Performance (DVA, excluding DSHI) for the period ended 30 June

			Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
		Note	2002-2003	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
REVENUE FROM ORDINARY ACTIVITIES
Revenue from Government
Ordinary Annual Appropriations			255,230	259,755	266,079	272,577	281,433
Resources received free of charge			330	338	346	353	361
Sub-total			255,560	260,093	266,425	272,930	281,794
Revenue from Independent Sources
Sale of Goods & Services		2	17,473	14,713	13,868	14,187	14,511
Interest			848	0	0	0	0
Sub-total			18,321	14,713	13,868	14,187	14,511
Total Revenue from Ordinary Activities			273,881	274,806	280,293	287,117	296,305
EXPENSES FROM ORDINARY ACTIVITIES
Employees		3	148,387	152,586	159,055	160,492	164,156
Suppliers			113,369	108,524	103,347	106,230	109,388
Depreciation & Amortisation			10,516	14,331	16,783	18,862	21,622
Total Expenses from Ordinary Activities			272,272	275,441	279,185	285,584	295,166
Operating Surplus (deficit) from Ordinary Activities			1,609	(635)	1,108	1,533	1,139
Capital Use Charge			5,085	0	0	0	0
Net surplus (deficit) after Capital Usage Charge and Extraordinary items			(3,476)	(635)	1,108	1,533	1,139

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Table 3.1C - Budgeted Departmental Statement of Financial Performance (Defence Service Homes Insurance Scheme) for the period ended 30 June

			Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
		Note	2002-2003	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
REVENUE FROM ORDINARY ACTIVITIES
Revenue from Government
Resources received free of charge			50	50	50	50	50
Sub-total			50	50	50	50	50
Revenue from Independent Sources
Sale of Goods & Services		2	20,600	20,100	19,800	19,350	19,350
Interest			3,100	3,200	3,300	3,400	3,400
Sub-total			23,700	23,300	23,100	22,750	22,750
Total Revenue from Ordinary Activities			23,750	23,350	23,150	22,800	22,800
EXPENSES FROM ORDINARY ACTIVITIES
Employees		3	3,200	3,300	3,450	3,500	3,500
Suppliers			3,150	3,150	3,150	3,150	3,150
Depreciation and amortisation			287	270	256	236	207
Claims			14,850	14,400	14,400	13,900	13,900
Total Expenses from Ordinary Activities			21,487	21,120	21,256	20,786	20,757
Operating Surplus (deficit) from Ordinary Activities			2,263	2,230	1,894	2,014	2,043
Capital Use Charge			0	0	0	0	0
Net surplus (deficit) after Capital Usage Charge and Extraordinary items			2,263	2,230	1,894	2,014	2,043

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Table 3.2A - Budgeted Departmental Statement of Financial Position (Amalgamated) as at 30 June

		Note	Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
			2002-2003	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
ASSETS
Financial Assets
	Cash		26,733	17,882	22,683	22,379	24,046
	Receivables	4	4,850	4,850	4,850	4,850	4,850
	Investments		55,000	56,200	57,200	58,200	60,200
	Other financial assets		1,500	1,500	1,800	1,800	2,500
Total financial assets			88,083	80,432	86,533	87,229	91,596
Non-Financial Assets
	Infrastructure, Plant & Equipment		19,174	23,204	22,225	23,885	24,587
	Intangibles		66,428	74,067	76,592	77,488	76,580
	Other		3,600	3,612	3,569	3,655	3,372
Total non-financial assets			89,202	100,883	102,386	105,028	104,539
Total Assets			177,285	181,315	188,919	192,257	196,135
LIABILITIES
Provisions and Payables
	Employees	5	58,905	57,993	62,535	63,266	63,892
	Suppliers		7,300	7,300	7,300	7,300	7,300
	Other provisions and payables		21,058	19,900	19,900	18,900	18,910
Total provisions and payables			87,263	85,193	89,735	89,466	90,102
Total Liabilities			87,263	85,193	89,735	89,466	90,102
EQUITY
	Accumulated Surplus (deficit)		45,608	47,203	50,205	53,752	56,934
	Capital		44,414	48,919	48,979	49,039	49,099
Total Equity			90,022	96,122	99,184	102,791	106,033
Total Liabilities and Equity			177,285	181,315	188,919	192,257	196,135
	Current Assets		91,683	84,044	90,102	90,884	94,968
	Non-Current Assets		85,602	97,271	98,817	101,373	101,167
	Current Liabilities		55,153	50,496	52,095	52,453	53,118
	Non-Current Liabilities		32,110	34,697	37,640	37,013	36,984

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Table 3.2B - Budgeted Departmental Statement of Financial Position (DVA, excluding DSHI) as at 30 June

		Note	Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
			2002-2003	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
ASSETS
Financial Assets
	Cash		22,320	13,539	17,646	17,328	19,252
	Receivables	4	1,550	1,550	1,550	1,550	1,550
Total financial assets			23,870	15,089	19,196	18,878	20,802
Non-Financial Assets
	Infrastructure, Plant & Equipment		19,168	23,200	22,223	23,885	24,587
	Intangibles		65,288	72,995	75,574	76,554	75,753
	Other		3,168	3,168	3,169	3,169	3,169
Total non-financial assets			87,624	99,363	100,966	103,608	103,509
Total Assets			111,494	114,452	120,162	122,486	124,311
LIABILITIES
Provisions and Payables
	Employees	5	58,655	57,743	62,285	63,016	63,642
	Suppliers		6,300	6,300	6,300	6,300	6,300
Total provisions and payables			64,955	64,043	68,585	69,316	69,942
Total Liabilities			64,955	64,043	68,585	69,316	69,942
EQUITY
	Accumulated Surplus (deficit)		2,125	1,490	2,598	4,131	5,270
	Capital		44,414	48,919	48,979	49,039	49,099
Total Equity			46,539	50,409	51,577	53,170	54,369
Total Liabilities and Equity			111,494	114,452	120,162	122,486	124,311
	Current Assets		27,038	18,257	22,365	22,047	23,971
	Non-Current Assets		84,456	96,195	97,797	100,439	100,340
	Current Liabilities		32,845	29,346	30,945	32,303	32,958
	Non-Current Liabilities		32,110	34,697	37,640	37,013	36,984

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Table 3.2C - Budgeted Departmental Statement of Financial Position (Defence Service Homes Insurance Scheme) as at 30 June

		Note	Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
			2002-2003	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
ASSETS
Financial Assets
	Cash		4,413	4,343	5,037	5,051	4,794
	Receivables		3,300	3,300	3,300	3,300	3,300
	Investments		55,000	56,200	57,200	58,200	60,200
	Other financial assets		1,500	1,500	1,800	1,800	2,500
Total financial assets			64,213	65,343	67,337	68,351	70,794
Non-Financial Assets
	Infrastructure, Plant & Equipment		6	4	2	0	0
	Intangibles		1,140	1,072	1,018	934	827
	Other		432	444	400	486	203
Total non-financial assets			1,578	1,520	1,420	1,420	1,030
Total Assets			65,791	66,863	68,757	69,771	71,824
LIABILITIES
Provisions and Payables
	Employees	5	250	250	250	250	250
	Suppliers		1,000	1,000	1,000	1,000	1,000
	Other provisions and payables		21,058	19,900	19,900	18,900	18,910
Total provisions and payables			22,308	21,150	21,150	20,150	20,160
Total Liabilities			22,308	21,150	21,150	20,150	20,160
EQUITY
	Accumulated Surplus (deficit)		43,483	45,713	47,607	49,621	51,664
Total Equity			43,483	45,713	47,607	49,621	51,664
Total Liabilities and Equity			65,791	66,863	68,757	69,771	71,824
	Current Assets		64,645	65,787	67,737	68,837	70,997
	Non-Current Assets		1,146	1,076	1,020	934	827
	Current Liabilities		22,308	21,150	21,150	20,150	20,160
	Non-Current Liabilities		0	0	0	0	0

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Table 3.3A - Budgeted Departmental Statement of Cash Flows (Amalgamated) for the period ended 30 June

		Note	Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
			2002-03	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
OPERATING ACTIVITIES
Cash Received
	Appropriations for Outputs		255,230	259,755	266,079	272,577	281,433
	Sale of goods and services		40,962	36,863	36,718	35,587	36,911
	Interest		3,880	3,200	3,300	3,400	3,400
	GST Input Credit Receipts		14,954	14,350	13,676	13,812	13,921
Total Cash Received			315,026	314,168	319,773	325,376	335,665
Cash Used (Infrastructure, plant and equipment and intangibles)
	Employees		148,796	156,798	157,963	163,261	167,030
	Suppliers		119,343	114,026	109,158	112,113	115,014
	GST Payments to Suppliers		14,954	14,350	13,676	13,812	13,921
	Claims		15,268	14,880	14,650	13,900	14,470
Total Cash Used			298,361	300,054	295,447	303,086	310,435
Net Cash from (used by) Operating Activities		6	16,665	14,114	24,326	22,290	25,230
INVESTING ACTIVITIES
Cash Received
	Sale of Investments		0	0	0	0	0
Total Cash Received			0	0	0	0	0
Cash Used
	Purchase of PP&E and intangibles		21,463	26,270	18,585	21,654	21,623
	Purchase of investments		189	1,200	1,000	1,000	2,000
Total Cash Used			21,652	27,470	19,585	22,654	23,623
Net Cash from (used by) Investing Activities		6	(21,652	(27,470)	(19,585)	(22,654)	(23,623)
FINANCING ACTIVITIES
Cash Received
	Equity Injections		6,566	4,505	60	60	60
Total Cash Received			6,566	4,505	60	60	60
Cash Used
	Capital Use Charge		5,121	0	0	0	0
Total Cash Used			5,121	0	0	0	0
Net Cash from (used by) Financing Activities		6	1,445	4,505	60	60	60
Net Increase/(Decrease) in Cash Held		6	(3,542)	(8,851)	4,801	(304)	1,667
Cash at Beginning of Reporting Period			30,275	26,733	17,882	22,683	22,379
Cash at End of Reporting Period			26,733	17,882	22,683	22,379	24,046

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Table 3.3B - Budgeted Departmental Statement of Cash Flows (DVA, excluding DSHI) for the period ended 30 June

		Note	Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
			2002-03	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
OPERATING ACTIVITIES
Cash Received
	Appropriations for Outputs		255,230	259,755	266,079	272,577	281,433
	Sale of goods and services		18,245	14,713	13,868	14,187	14,511
	Interest		844	0	0	0	0
	GST Input Credit Receipts		12,644	12,090	11,346	11,632	11,641
Total Cash Received			286,963	286,558	291,293	298,396	307,585
Cash Used (Infrastructure, plant and equipment and intangibles)
	Employees		145,500	153,498	154,513	159,761	163,530
	Suppliers		112,716	108,186	103,002	105,877	109,027
	GST Payments to Suppliers		12,644	12,090	11,346	11,632	11,641
Total Cash Used			270,860	273,774	268,861	277,270	284,198
Net Cash from (used by) Operating Activities		6	16,103	12,784	22,432	21,126	23,387
INVESTING ACTIVITIES
Cash Used
	Purchase of PP&E and intangibles		21,263	26,070	18,385	21,504	21,523
Total Cash Used			21,263	26,070	18,385	21,504	21,523
Net Cash from (used by) Investing Activities		6	(21,263)	(26,070)	(18,385)	(21,504)	(21,523)
FINANCING ACTIVITIES
Cash Received
	Equity Injections		6,566	4,505	60	60	60
Total Cash Received			6,566	4,505	60	60	60
Cash Used
	Capital Use Charge		5,121	0	0	0	0
Total Cash Used			5,121	0	0	0	0
Net Cash from (used by) Financing Activities		6	1,445	4,505	60	60	60
Net Increase/(Decrease) in Cash Held		6	(3,715)	(8,781)	4,107	(318)	1,924
Cash at Beginning of Reporting Period			26,035	22,320	13,539	17,646	17,328
Cash at End of Reporting Period			22,320	13,539	17,646	17,328	19,252

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Table 3.3C - Budgeted Departmental Statement of Cash Flows (Defence Service Homes Insurance Scheme) for the period ended 30 June

		Note	Estimated Actual	Budget Estimate	Forward Estimate	Forward Estimate	Forward Estimate
			2002-03	2003-04	2004-05	2005-06	2006-07
			$'000	$'000	$'000	$'000	$'000
OPERATING ACTIVITIES
Cash Received
	Sale of goods and services		23,167	22,600	23,300	21,850	22,850
	Interest		3,036	3,200	3,300	3,400	3,400
	GST Input Credit Receipts		2,310	2,260	2,330	2,180	2,280
Total Cash Received			28,513	28,060	28,930	27,430	28,530
Cash Used (Infrastructure, plant and equipment and intangibles)
	Employees		3,296	3,300	3,450	3,500	3,500
	Suppliers		7,077	6,290	6,606	6,686	6,437
	GST Payments to Suppliers		2,310	2,260	2,330	2,180	2,280
	Claims		15,268	14,880	14,650	13,900	14,470
Total Cash Used			27,951	26,730	27,036	26,266	26,687
Net Cash from (used by) Operating Activities		6	562	1,330	1,894	1,164	1,843
INVESTING ACTIVITIES
Cash Received
	Sale of Investments		0	0	0	0	0
Total Cash Received			0	0	0	0	0