Portfolio Budget Statements 2008-09 

• 3.1 Explanatory tables
• 3.2 Budgeted financial statements

Section 3 presents budgeted financial statements which provide a comprehensive snapshot of agency finances for the Budget year 2008–09. It explains how budget plans are incorporated into the financial statements and provides further details of movements in administered funds, special accounts and Government Indigenous expenditure.

3.1 Explanatory Tables

3.1.1 Reconciliation of total available appropriation and outcomes

The Agency Resource Statement (Table 1.1) details the total available appropriation available to an agency from all sources. For departmental operating appropriations (outputs) this includes carry-forward amounts as well as amounts appropriated at Budget. As agencies incur and are funded for future liabilities, generally depreciation and employee entitlements, the total amount of departmental operating appropriation available to an agency is unlikely to be fully utilised in the budget year. Outcome resource statements include details of the expected use of available resources in contributing towards outcomes in the budget year. The difference between the agency level resource statement and the sum of all outcome resource statements is the expected carry-forward amount of resources for the 2009–10 Budget year, including amounts related to meeting future obligations to maintain the agency’s asset base and to meet employee entitlement liabilities. Table 3.1.1 reconciles the total available appropriation and amounts attributable to all outcomes.

3.1.2 Movement of administered funds between years

AHL has no administered funds for 2008–09.

3.1.3 Special Accounts

AHL has no Special Accounts for 2008–09.

3.1.4 Australian Government Indigenous Expenditure

1. $1.8 million of grant income is excluded from Other to avoid double counting of expenditure included in AGIE summary for the Department of Health and Ageing. If the figure is included, other income total would be $14.049 million ($12.249 million for Output 1.1+ $1.8 million for Output 1.2) resulting in total Output Group of $54.802 million

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3.2 Budgeted Financial Statements

3.2.1 Differences in agency resourcing and financial statements

There are no significant differences between the resource information presented in the Budget Papers and Portfolio Budget Statements (PB Statements) as a result of differences between Australian Accounting Standards (AAS) and Government Finance Statistics (GFS). Furthermore, there are no differences which arise because of related entity transactions.

3.2.2 Analysis of budgeted financial statements

An analysis of the primary causes of movements from the financial statements published in the 2007–08 PB Statements is provided below.

Budgeted departmental income statement

This statement provides a picture of the expected financial results for AHL by identifying full accrual expense and revenues, which highlights whether AHL is operating at a sustainable level.

Total revenue

Operating income from Government has increased by $0.6 million in 2008–09 as a result of additional operating funds for Kununurra Secondary Education Hostel ($0.3 million) and Fire Safety depreciation ($0.1 million) and net increase in on-going operational costs of $0.2 million.

Accommodation charges have increased due to revision of tariff rates in line with the increase in Centrelink benefits and the planned opening of new hostels such as Kununurra Secondary Education Hostel and Renal Dialysis hostel in Townsville.

Indigenous Youth Mobility Program (IYMP) is a four-year program ending on 30 June 2009. $13.6 million has been received to date. A further $1.7 million is due in 2008–09 with a final payment of $0.4 million due in 2009–10.

Total Expenses

Salaries and employee benefits: These have been increased by $0.56 million as a result of new AHL hostels and new hostels under the IYMP program.

Suppliers: This includes food, materials, services and sundry expenses.

Depreciation and Amortisation: Higher level of depreciation expenditure flow from the acquisition costs for Fire Safety works across all AHL sites of $5.4 million over the three financial years to 2009–10.

Grants: This item represents the community hostels grants of a capital and operating nature to approved organisations to operate hostels.

Budgeted departmental balance sheet

This statement shows the financial position of AHL. It helps decision-makers to track the management of assets and liabilities.

The major variations between estimated actuals for 2007–08 and the budget for 2008–09 in the Balance Sheet are as follows:

• Investment activity in non-current assets continues to increase in 2008–09 due to the capital equity injections for the fire safety upgrades ($1.2 million), Renal Dialysis Hostels ($3.7 million) and Noongah Elders Home in Perth ($1.6 million).
• The cash balance reflects the nature of hostel major maintenance and construction works as they normally take 2-3 years to complete. Consequently, actual payments are spread over two financial years resulting in higher than normal cash balance.
• The receivables are fairly stable and include items such as GST refunds due from Australian Taxation Office and trade debtors.
• Liabilities are expected to remain at similar level for the next three financial years.

Budgeted departmental statement of cash flows

Budgeted cash flows, as reflected in the statement of cash flows, provide 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 major variations between estimated actuals for 2007–08 and budget for 2008–09 in the Statement of Cash Flows are as follows:

• The increase in total cash to be received in 2008–09 is linked to the increase in Commonwealth appropriation and higher level of accommodation charges collected ($0.5 million cash impact).
• The trend in payments to suppliers and employees is in line with the comments provided under the expenses category in the Income Statement.
• The purchase of property, plant and equipment increases in 2008–09 due to the use of the capital equity injections for the fire safety upgrades ($1.2 million), Renal Dialysis Hostels ($3.7 million) and Noongah Elders Home in Perth ($1.6 million).

Departmental statement of changes in equity – summary of movement

The changes in the statement of equity is represented by $0.1 million surplus for the 2008–09 financial year and $6.5 million capital equity injections for the fire safety upgrades ($1.2 million), Renal Dialysis Hostels ($3.7 million) and Noongah Elders Home in Perth ($1.6 million).

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3.2.3 Budgeted financial statements tables

Prepared on Australian Accounting Standards basis

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*Note: 'equity' is the residual interest in assets after deduction of liabilities. Prepared on Australian Accounting Standards basis

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Prepared on Australian Accounting Standards basis

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Prepared on Australian Accounting Standards basis

3.2.4 Notes to the financial statements

The financial statements have been prepared in accordance with Australian Equivalent of International Financial Reporting Standards (AEIFRS) and other authoritative pronouncements of the Australian Accounting Standards Board and the Corporations Act 2001.

The financial statements are prepared on an accrual basis and in accordance with historical cost convention.

The accounting policies adopted that underpin these statements are consistent with those applied in 2007–08.

Reference should be made to AHL’s Annual Report 2007–08 for detailed disclosure of AHL’s accounting policies.