PART D - AGENCY BUDGET STATEMENTS
AUSTRALIAN WAR MEMORIAL
SECTION 3 - BUDGETED FINANCIAL STATEMENTS
Budgeted Financial
Statements
Analysis of Budgeted Financial
Statements
Table 3.1 – Budgeted Departmental Statement of Financial
Performance
Table 3.2 – Budgeted Departmental Statement of Financial
Position
Table 3.3 – Budgeted Departmental Statement of Cash
Flows
Table 3.4 – Departmental Capital Budget Statement
Table 3.5 – Departmental Non-financial Assets –
Summary of Movement - Budget Year 2003-04
notes
Glossary
BUDGETED FINANCIAL STATEMENTS
The budgeted financial statements for the Australian War Memorial are presented in this section. The budgeted financial statements will form the basis of the financial statements that will appear in the Australian War Memorial 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 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, accounts payable and receivable are reported as gross amounts.
ANALYSIS OF BUDGETED FINANCIAL STATEMENTS
The Memorial is forecasting a surplus in the Budget Year of $2.38m. This is primarily due to a strategy aimed at accumulating cash over the next couple of years for application to future gallery redevelopment projects as per the current corporate plan.
Total revenue is estimated to be $38.443m, a decrease of approximately $61.3m from the 2002-03 estimated actual revenue. This relates to the cessation of the capital use charge previously funded by government. It is expected that revenue from independent sources will increase due to Memorial initiatives such as enhanced online access to collection material, education products and programs, online sales of related goods and services and other marketing and promotional activities.
Revenue from government includes a provisional appropriation of $0.907m associated with an adjustment to prior year depreciation funding. The appropriation is to be confirmed by a joint examination between the Memorial and the Department of Finance and Administration.
Total expenses are estimated to be $36.063m, an increase of $0.222m due to increased employee expenses and depreciation charges.
The net asset position of $578m represents an increase of $2.38m from the 2002-03 estimated actual. Land and buildings are projected to increase in value due to the re-valuation of these assets and expenditure on capital works. The Memorial's primary asset, the National Collection, is projected to marginally decrease in value over the forward years due to the depreciable nature of certain items.
The Memorial's primary liability continues to be employee provisions of $4.927m, as a result of accruing leave entitlements. The liability is expected to increase by $0.103m in 2003-04.
Budgeted Statement of Financial Performance
This statement presents the expected financial results for the Memorial by identifying full accrual expenses and revenues. This statement highlights whether the Memorial is operating at a sustainable level in the short term.
Budgeted Statement of Financial Position
This statement shows the financial position of the Memorial and whether its financial strength is likely to improve or worsen over time. It enables decision-makers to track the management of the Memorial assets and liabilities and, in conjunction with information on forecast cash flows, determine whether the Department is financially viable in the long term.
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.
Capital Budget
The Capital Budget shows proposed capital expenditure funded either by Budget appropriations or from internal sources.
Non-financial Assets - (Summary of Movements)`
This statement shows the budgeted acquisitions and disposals of non-financial assets during the budget year.
Notes To The Budgeted Financial Statements
| Note |
Estimated
Actual 2002-03 $'000 |
Budget
Estimate
2003-04
$'000<
|
Forward
estimate 2004-05 $'000 |
Forward
estimate 2005-06 $'000 |
Forward
estimate 2006-07 $'000 |
|
|---|---|---|---|---|---|---|
|
Note 1 - Revenue from Government
|
||||||
|
Revenue from government includes a provisional appropriation of $0.907m associated with an adjustment to prior year depreciation funding. The appropriation is to be confirmed by a joint examination between the Memorial and the Department of Finance. |
||||||
|
Note 2 - Other Revenue from Independent Sources
|
||||||
|
2,294
|
1,096
|
797
|
1,798
|
1,799
|
||
| Other Revenue from Independent Sources includes sponsorship and donation funds received towards the Memorial's ongoing Gallery Development program. | ||||||
|
Note 3 - Depreciation and Amortisation
|
||||||
|
9,609
|
9,981
|
10,410
|
10,565
|
10,620
|
||
|
Depreciation includes the depreciation of certain items of the National Collection which have a limited useful life, eg photography, film and sound. |
||||||
|
Note 4 - Infrastructure, Plant & Equipment
|
||||||
| Infrastructure, Plant & Equipment |
4,909
|
4,740
|
4,626
|
4,516
|
4,406
|
|
| Exhibitions |
6,189
|
8,411
|
11,283
|
13,555
|
13,827
|
|
|
11,098
|
13,151
|
15,909
|
18,071
|
18,233
|
||
|
Note 5 - Intangibles
|
||||||
| This class of assets is primarily software. |
1,882
|
1,796
|
1,709
|
1,622
|
1,536
|
|
|
Note 6 - Cash Flow Reconciliation
|
||||||
|
Surplus/(Deficit) prior to CUC expense
|
63,957
|
2,380
|
2,110
|
2,317
|
1,974
|
|
|
|
||||||
|
Depreciation
|
9,609
|
9,981
|
10,410
|
10,565
|
10,620
|
|
|
(Profit)/Loss on sale of assets
|
(12)
|
(12)
|
(12)
|
(12)
|
(12)
|
|
|
Write down of assets
|
2
|
2
|
2
|
2
|
2
|
|
|
Loss on disposal of non-current asset
|
56
|
19
|
19
|
19
|
19
|
|
|
|
||||||
|
Changes in assets and liabilities
|
||||||
|
(Increase)/Decrease in receivables
|
0
|
(907)
|
(1,336)
|
(1,491)
|
(1,546
|
|
|
Increase)/Decrease in inventories
|
0
|
0
|
0
|
0
|
0
|
|
|
(Increase)/Decrease in accrued revenues
|
0
|
0
|
0
|
0
|
0
|
|
|
(Increase)/Decrease in prepayments
|
0
|
0
|
0
|
0
|
0
|
|
|
Increase/(Decrease) in trade creditors
|
0
|
0
|
0
|
0
|
0
|
|
|
Increase/(Decrease) in employee provisions
|
104
|
102
|
112
|
111
|
111
|
|
|
Increase/(Decrease) in other provisions and payables
|
(417)
|
500
|
500
|
(500)
|
(500)
|
|
|
|
||||||
|
Net cash used by operating activities
|
73,299
|
12,065
|
11,804
|
11,011
|
10,668
|
|
Glossary
| Accrual Accounting | System of accounting where items are brought to account and included in the financial statements as they are earned or incurred, rather than as they are received or paid. |
| Accumulated Depreciation | The aggregate depreciation recorded for a particular depreciating asset. |
| Administered items | Expenses, revenues, assets or liabilities managed by agencies on behalf of the Commonwealth. Agencies do not control administered items. Administered expenses include grants, subsidies and benefits. In many cases, administered expenses fund the delivery of third party outputs. |
| Additional estimates | Where amounts appropriated at Budget time are insufficient, Parliament may appropriate more funds to portfolios through the Additional Estimates Acts. |
| Additional Estimates Bills or Acts | These are Appropriation Bills 3 and 4, and a separate Bill for the Parliamentary Departments (Appropriations (Parliamentary Departments) Bill (No 2). These Bills are introduced into Parliament after the Budget Bills. |
| Appropriation | An authorisation by Parliament to spend moneys from the Consolidated Revenue Fund for a particular purpose. |
| Annual appropriation | Two appropriation Bills are introduced into Parliament in May and comprise the Budget for the financial year beginning 1 July. Further Bills are introduced later in the financial year as part of the additional estimates. Parliamentary Departments have their own appropriations. |
| Capital expenditure | Expenditure by an agency on capital projects, for example purchasing a building. |
| Capital-Use Charge | The Capital-Use Charge is a dividend requirement levied on Commonwealth General Government Sector agencies and authorities. The Capital-Use Charge payment is based on those agencies and authorities Departmental net assets at financial year-end. Funding for the Capital-Use Charge is included in agencies' and authorities' Departmental price of outputs appropriation. |
| Consolidated Revenue Fund | Section 81 of the Constitution stipulates that all revenue raised or money received by the Commonwealth forms the one consolidated revenue fund (CRF). The CRF is not a bank account. The Official Public Account reflects most of the operations of the CRF. |
| Departmental items | Assets, liabilities, revenues and expenses which are controlled by the agency providing it's outputs. Departmental items would generally include computers, plant and equipment assets used by agencies in providing goods and services and most employee expenses, supplier costs and other administrative expenses incurred. |
| Depreciation | Apportionment of an asset's capital value as an expense over its estimated useful life to take account of normal useage, obsolescence, or the passage of time. |
| Deprival asset valuation | Values non financial assets according to the current cost of their replacement. That is, non financial assets are valued at the lowest cost of replacing the gross 'service potential' of those assets. |
| Effectiveness indicators | Measures the joint or independent contribution of outputs and administered items to the achievement of their specified outcome |
| Efficiency indicators | Measures the adequacy of an agency's management of its outputs (and where applicable, administered items). The interrelationship between the three efficiency indicators of any one output should be considered when judging efficiency. |
| Equity or Net Assets | Residual interest in the assets of an entity after deduction of liabilities. |
| Expense | Total value of all of the resources consumed in producing goods and services or the loss of future economic benefits in the form of reductions in assets or increases in liabilities of an entity. |
| Fair Value | Valuation methodology: The amount for which an asset could be exchanged, or a liability settled, between knowledgeable and willing parties in an arm's length transaction. The fair value can be affected by the conditions of the sale, market conditions and the intentions of the asset holder. |
| Historical cost | The original cost of acquisition of an asset, including any costs associated with acquisition. Under Australian Accounting Standard 10 'Acquisition of Non Current Assets' assets need to be reported initially at acquisition (historical cost). The Commonwealth's financial reporting requirements issued under the Finance Minister's Orders require the subsequent revaluation of non current assets to their deprival value within every three years. |
| Intermediate outcomes | More specific medium-term impacts (trend data, targets and milestones) below the level of the planned outcomes specified in the Budget. Combination of several intermediate outcomes can at times be considered as a proxy for determining the achievement of outcomes. |
| Liabilities | Future sacrifices of economic benefits that an entity is presently obliged to make to other entities as a result of past transactions or other past events. |
| Measure | A decision by the Cabinet or Ministers that has been finalised since the 2002-03 Budget and has resulted in expenditure in the years 2003-04 to 2006-07. |
| Operating result | Equals revenue less expense. |
| Outcomes | The Government's objectives in each portfolio area. Outcomes are desired results, impacts or consequences for the Australian community as influenced by the actions of the Commonwealth. Actual outcomes are assessments of the results or impacts actually achieved. |
| Output groups | A logical aggregation of agency outputs, where useful based either on homogeneity, type of product or beneficiary target group. Aggregation may also be needed for the provision of adequate information for performance monitoring; or based on a materiality test. |
| Outputs | The goods and services produced by agencies on behalf of government for external organisations or individuals. Outputs include goods and services for other areas of government external to the agency. |
| Price | One of the three key efficiency indicators. The amount the government or the community pays for the delivery of agreed outputs. |
| Quality | One of the three key efficiency indicators. Relates to the characteristics by which customers or stakeholders judge an organisation, product or service. Assessment of quality involves use of information gathered from interested parties to identify differences between user's expectations and experiences. |
| Quantity | One of the three key efficiency indicators. Size of an output. Count or volume measures. How many or how much. |
| Revenue | Total value of resources earned or received to cover the production of goods and services. |
| Special Account | Balances existing within the Consolidated revenue Fund (CRF), that are supported by standing appropriations (Financial Management and Accountability (FMA) Act 1997, ss20 and 21). Special accounts allow money in the CRF to be acknowledged as set aside (hypothecated) for a particular purpose. Amounts credited to a Special Account may only be spent for the purposes of the Special Account. Special Accounts can only be established by a written determination of the Finance Minister (s.20 FMA Act) or through an Act of Parliament(referred to in s21 of the FMA Act). |
| Special Appropriations (including Standing Appropriations) | An amount of money appropriated by a particular
Act of Parliament for a specific purpose and number of years. For special
appropriations the authority to withdraw funds from the Consolidated Revenue
Fund does not generally cease at the end of the financial year.
Standing appropriations are a sub-category consisting of ongoing special appropriations - the amount appropriated will depend on circumstances specified in the legislation. |