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115Australian Industrial Registry 2007–08 Annual Report
Financial Statements
Independent Audit Report ........................................................................................................... 116
Statement by the Chief Executive and the Chief Finance Officer .................................................. 118
Income Statement ....................................................................................................................... 119
Balance Sheet ............................................................................................................................. 120
Statement of Changes in Equity .................................................................................................. 121
Cash Flow Statement .................................................................................................................. 122
Schedule of Commitments .......................................................................................................... 123
Schedule of Administered Items .................................................................................................. 125
Notes to and Forming Part of the Financial Statements ................................................................ 127
5Appendix
Financial Statements
116 2007–08 Annual Report Australian Industrial Registry
5Appendix
117Australian Industrial Registry 2007–08 Annual Report
5Appendix
Financial Statements
118 2007–08 Annual Report Australian Industrial Registry
5Appendix
STATEMENT BY THE CHIEF EXECUTIVE AND THE CHIEF FINANCE OFFICER
In our opinion, the attached financial statements of the Australian Industrial Registry for the year ended 30 June 2008 have been prepared based on properly maintained financial records and give a true and fair view of the matters required by the Finance Minister’s Orders made under the Financial Management and Accountability Act 1997, as amended.
Signed SignedDS Williams Dennis MihelyiIndustrial Registrar and Chief Executive Chief Finance Officer17 September 2008 17 September 2008
119Australian Industrial Registry 2007–08 Annual Report
5Appendix
2008 2007
Notes $’000 $’000
INCOMERevenue
Revenue from Government 3a 53,683 66,450
Sale of goods and rendering of services
Rental income
3b
3c
76685
43
-
Other revenue 3d 38 36
Total Revenue 54,482 66,529
GainsSale of assets 3e 3 30
Other gains 3f 24 123
Total Gains 27 153
TOTAL INCOME 54,509 66,682
EXPENSESEmployee benefits 4a 26,629 26,178
Suppliers 4b 18,427 28,869
Depreciation and amortisation 4c 820 799
Finance costs 4d 151 267
Write-down and impairment of assets 4e 13 77
Losses from asset sales 4f 5 -
Liquidated damages 4g - 1,853
TOTAL EXPENSES 46,045 58,043
SURPLUS 8,464 8,639
The above statement should be read in conjunction with the accompanying notes.
INCOME STATEMENTfor the period ended 30 June 2008
Financial Statements
120 2007–08 Annual Report Australian Industrial Registry
5Appendix
2008 2007
Notes $’000 $’000
ASSETS
Financial Assets
Cash and cash equivalents 5a 252 446
Trade and other receivables 5b 42,397 34,402
Total financial assets 42,649 34,848
Non-financial Assets
Buildings and leasehold improvements 6a 3,256 2,894
Plant and equipment 6b 1,027 1,858
Intangibles 6c 996 729
Other non-financial assets 6d 1,236 1,133
Total non-financial assets 6,515 6,614
Total Assets 49,164 41,462
LIABILITIES
Payables
Suppliers 7a 668 1,321
Total payables 668 1,321
Provisions
Employee provisions 8a 10,818 10,580
Other provisions 8b 7,402 7,730
Total provisions 18,220 18,310
Total Liabilities 18,888 19,631
NET ASSETS 30,276 21,831
EQUITY
Parent Entity Interest
Contributed equity 8,802 8,802
Reserves 186 205
Retained surplus 21,288 12,824
Total Equity 30,276 21,831
Current Assets 43,885 35,981
Non-Current Assets 5,279 5,481
Current Liabilities 11,724 12,325
Non-Current Liabilities 7,164 7,306
The above statement should be read in conjunction with the accompanying notes.
BALANCE SHEETas at 30 June 2008
121Australian Industrial Registry 2007–08 Annual Report
5Appendix
Retained Earnings
Revaluation Reserve
Contributed Equity/Capital Total Equity
2008 2007 2008 2007 2008 2007 2008 2007
$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000
Opening balance 12,824 4,185 205 205 8,802 2,125 21,831 6,515
Income and expensesIncome and expenses recognised Directly in Equity - - (19) - - - (19) -
Sub-total income and expenses recognised Directly in Equity - - (19) - - - (19) -
Surplus for the period 8,464 8,639 - - - - 8,464 8,639
Total income and expenses 8,464 8,639 (19) - - - 8,445 8,639
Transactions with owners
Contributions by ownersAppropriation (equity injection) - - - - - 6,677 - 6,677
Sub-total transactions with owners - - - - - 6,677 - 6,677
Closing Balance at 30 June 21,288 12,824 186 205 8,802 8,802 30,276 21,831
The above statement should be read in conjunction with the accompanying notes.
STATEMENT OF CHANGES IN EQUITYas at 30 June 2008
Financial Statements
122 2007–08 Annual Report Australian Industrial Registry
5Appendix
2008 2007
Notes $’000 $’000
OPERATING ACTIVITIES
Cash received
Goods and services 858 105
Appropriations 45,799 60,250
Net GST received from ATO 1,778 3,685
Total cash received 48,435 64,040
Cash used
Employees (26,398) (26,118)
Suppliers (21,580) (34,537)
Total cash used (47,978) (60,655)
Net cash flows from operating activities 9 457 3,385
INVESTING ACTIVITIES
Cash received
Proceeds from sale of plant and equipment 3 34
Total cash received 3 34
Cash used
Purchase of plant and equipment 228 2,766
Purchase of intangibles 426 223
Total cash used 654 2,989
Net cash flows (used by) investing activities (651) (2,955)
Net decrease in cash held (194) 430
Cash and cash equivalents at the beginning of the reporting period 446 16
Cash and cash equivalents at the end of the reporting period 5a 252 446
The above statement should be read in conjunction with the accompanying notes.
CASH FLOW STATEMENTfor the period ended 30 June 2008
123Australian Industrial Registry 2007–08 Annual Report
5Appendix
2008 2007
$’000 $’000
BY TYPE
Commitments receivable
Sub-lease rental income (3,361) (970)
GST recoverable on commitments (9,453) (10,244)
Total commitments receivable (12,814) (11,214)
Other commitments
Operating leases 106,432 112,347
Other commitments 1,244 340
Total other commitments 107,676 112,687
Net commitments by type 94,862 101,473
BY MATURITY
Commitments receivable
Operating lease income
One year or less (695) (477)
From one to five years (1,333) (493)
Over five years (1,333) -
Total operating lease income (3,361) (970)
Other commitments receivable
One year or less (1,256) (1,085)
From one to five years (4,189) (4,215)
Over five years (4,008) (4,944)
Total other commitments receivable (9,453) (10,244)
Commitments payable
Operating lease commitments
One year or less 13,482 11,597
From one to five years 47,392 46,364
Over five years 45,558 54,386
Total operating lease commitments 106,432 112,347
SCHEDULE OF COMMITMENTSas at 30 June 2008
Financial Statements
124 2007–08 Annual Report Australian Industrial Registry
5Appendix
2008 2007
$’000 $’000
Other commitments
One year or less 1,088 340
From one to five years 156 -
Over five years - -
Total other commitments 1,244 340
Net commitments by maturity 94,862 101,473
NB: All commitments are GST inclusive where relevant.
The above schedule should be read in conjunction with the accompanying notes.
Nature of lease General description of leasing arrangement
Leases for office accommodation Lease payments are subject to either increase in accordance � with fixed amounts in the lease agreement or market rental reviews.
The AIR may exercise option clauses in accordance with the � terms of the leases.
Sub-lease of office accommodation The AIR has agreed to sub-let part of the Sydney premises to � the Federal Court of Australia for a two year period with two further one year options subject to consent by the AIR and the Federal Court.
The sub-lease has one year remaining. �
The AIR has agreed to sub-let part of the Perth premises � to Western Australian Minister for Works for a period of six months and has one month remaining.
The AIR has agreed to sub-let part of the Melbourne premises � to Calliden Group Ltd for a five year period with an option for a further term of four years and eight months. The sub-lease has 4 years and nine months remaining.
Agreements for the provision of motor vehicles to senior executive officers and members of the Australian Industrial Relations Commission
Leases are part of an operating lease and there are no � purchase options available to the AIR.
Lease in relation to computer and office equipment
The lessors provide all computer and office equipment in � accordance with the lease agreements.
The AIR may negotiate extensions at expiration. �
The above schedule should be read in conjunction with the accompanying notes.
SCHEDULE OF COMMITMENTS as at 30 June 2008 (continued)
125Australian Industrial Registry 2007–08 Annual Report
5Appendix
2008 2007
Notes $’000 $’000
Income administered on behalf of Government
for the period ended 30 June 2008
Revenue
Non-taxation revenue
Termination of employment lodgment fees 305 228
Less refunds of termination of employment lodgment fees (33) (31)
Total non-taxation revenue 272 197
Total Revenues administered on behalf of Government 272 197
No assets or liabilities administered on behalf of the Government for 2007–08 and 2006–07.
This schedule should be read in conjunction with the accompanying notes.
SCHEDULE OF ADMINISTERED ITEMS
Financial Statements
126 2007–08 Annual Report Australian Industrial Registry
5Appendix
2008 2007
Notes $’000 $’000
Administered Cash Flows
for the period ended 30 June 2008
OPERATING ACTIVITIES
Cash received
Other taxes, fees & fines 272 197
Total cash received 272 197
Net cash flows from operating activities 272 197
Net Increase in Cash Held 272 197
Cash to Official Public Account for:
– Other (272) (197)
– Lease incentive and liquidated damages repaid - (15,023)
(272) (15,220)
Cash and cash equivalents at the beginning of the reporting period - 15,023
Cash and cash equivalents at the end of the reporting period - -
The above schedule should be read in conjunction with the accompanying notes.
SCHEDULE OF ADMINISTERED ITEMS(continued)
127Australian Industrial Registry 2007–08 Annual Report
5Appendix
Note 1 Summary of Significant Accounting Policies
Note 2 Events Occurring after Reporting Date
Note 3 Income
Note 4 Expenses
Note 5 Financial Assets
Note 6 Non-financial Assets
Note 7 Payables
Note 8 Provisions
Note 9 Cash Flow Reconciliation
Note 10 Contingent Liabilities and Assets
Note 11 Senior Executive Remuneration
Note 12 Remuneration of Auditors
Note 13 Financial Instruments
Note 14 Administered Reconciliation Table
Note 15 Administered Contingent Liabilities and Assets
Note 16 Appropriations
Note 17 Special Accounts
Note 18 Compensation and Debt Relief
Note 19 Reporting of Outcome
INDEX TO THE NOTES OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
128 2007–08 Annual Report Australian Industrial Registry
5Appendix
Note 1: Summary of Significant Accounting Policies
1.1 Objectives of the Australian Industrial Registry
The Australian Industrial Registry (AIR) is a statutory authority established under s.62 of the Workplace Relations Act 1996 (WR Act).
The AIR is responsible for a single outcome. Outcome 1 “Cooperative workplace relations which promote the economic prosperity and welfare of the people of Australia”. The AIR activities contributing toward these outcomes are classified as either departmental or administered. Departmental activities involve the use of assets, liabilities, revenues and expenses controlled or incurred by the AIR in its own right. Administered activities involve the management or oversight by the AIR, on behalf of the Government, of items controlled or incurred by the Government. Departmental activities are identified under three outputs:
Output 1.1 Dispute resolution, orders and decisions;
Output 1.2 Registered organisations, compliance checks and investigations; and
Output 1.3 Publications and information services.
The AIR conducts the following administered activities:
the collection of termination of employment lodgment fees; and �
payment of pensions to former presidential members of the Australian Industrial Relations �Commission (AIRC) or their spouses under the Judges’ Pension Act 1968 drawn down from the Attorney-General’s Department.
The AIR’s mission is to facilitate the operations of the Australian workplace relations system. To carry out its mission, the AIR seeks to achieve the following goals:
act as the registry for the AIRC and to provide administrative support to the AIRC; �
to provide advice and assistance to organisations in relation to their rights and obligations under �the WR Act; and
such other functions as conferred upon the AIR by the WR Act, the � Building and Construction Industry Improvement Act 2005 or the Registration and Accountability of Organisations Schedule.
The continued existence of the AIR in its present form is dependent on Government policy and on continuing appropriations by Parliament for the AIR’s administration and programs.
1.2 Basis of Preparation of the Financial Statements
The financial statements are required by s.49 of the Financial Management and Accountability Act 1997 and are a general purpose financial report.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
129Australian Industrial Registry 2007–08 Annual Report
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The financial statements and notes have been prepared in accordance with:
Finance Minister’s Orders (or the FMOs) for reporting periods ending on or after 1 July 2007; and �
Australian Accounting Standards and Interpretations issued by the Australian Accounting �Standards Board (AASB) that apply for the reporting period.
The Financial Report has been prepared on an accrual basis and is in accordance with the historical cost convention, except for certain assets at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.
The Financial Report is presented in Australian dollars and values are rounded to the nearest thousand dollars unless otherwise specified.
Unless an alternative treatment is specifically required by an Accounting Standard or FMOs, assets and liabilities are recognised in the Balance Sheet when and only when it is probable that future economic benefits will flow to the Entity or a future sacrifice or economic benefits will be required and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under agreements equally proportionately unperformed are not recognised unless required by an Accounting Standard. Liabilities and assets that are unrealised are reported in the Schedule of Commitments.
Unless alternative treatment is specifically required by an accounting standard, revenues and expenses are recognised in the Income Statement when and only when the flow, consumption or loss of economic benefits has occurred and can be reliably measured.
Administered revenues, expenses, assets and liabilities and cash flows reported in the Schedule of Administered Items and related notes are accounted for on the same basis and using the same policies as for departmental items, except where otherwise stated at Note 1.19.
1.3 Significant Accounting Judgments and Estimates
In the process of applying the accounting policies listed in this note, the AIR has not made any judgments that have a significant impact on the amounts recorded in the financial statements.
The AIR has not made any accounting assumptions or estimates that have a significant risk or causing a material adjustment to carrying amounts of assets and liabilities within the next accounting period.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
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1.4 Adoption of New Australian Accounting Standard Requirements
No accounting standard has been adopted earlier than the application date as stated in the standard. The following new standards are applicable to the current reporting period:
Financial Instrument Disclosure
AASB 7 Financial Instruments: Disclosure is effective for reporting periods beginning on or after 1 January 2007 (the 2007–08 financial year) and amends the disclosure requirements for financial instruments. In general AASB 7 requires greater disclosure than that previously required. Associated with the introduction of AASB 7 a number of accounting standards were amended to reference the new standard or remove the present disclosure requirements through 2005–10 Amendments to Australian Accounting Standards [AASB 132, AASB 101, AASB 114, AASB 117, AASB 133, AASB 139, AASB 1, AASB 4, AASB 1023 & AASB 1038]. These changes have no financial impact but will affect the disclosure presented in future financial reports.
The following standards, amendments to standards or interpretations for the current financial year have no material financial impact on the AIR.
AASB 1048: � Interpretation and Application of Standards (reissued September 2007)
AASB 2007–4: � Amendments to Australian Accounting Standards arising from ED 151 and other amendments
AASB 2007–5: � Amendments to Australian Accounting Standards—Inventories Held for Distribution by Not-for-Profit Entities [AASB 102]
AASB 2007–7: � Amendments to Australian Accounting Standards [AASB 1, 2, 4, 5, 107, 128]
AASB 2008–4: � Amendments to Australian Accounting Standards—Key Management Personnel Disclosures by Disclosing Entities [AASB 124]
AASB 2008–5 Amendments to Australian Accounting Standards arising from the Annual �Improvements Project [AASBs 5, 7, 101, 102, 107, 108, 110, 116, 118, 119, 120, 123, 127, 128, 129, 131, 132, 134, 136, 138, 139, 140, 141, 1023 & 1038]
AASB 2008–6 Further Amendments to the Australian Accounting Standards arising from the �Annual Improvements Project [AASB 1 & AASB 5]
AASB 2008–7 Amendments to Australian Accounting Standards—Cost of an Investment in a �Subsidary, Jointly Controlled Entity or Associate [AASB 1, AASB 118, AASB 121 & AASB 136]
AASB Interpretation 12 � Service Concession Arrangements and 2007–2 Amendments to Australian Accounting Standards arising from AASB Interpretation 12
AASB 8 � Operating Segments and 2007–3 Amendments to Australian Accounting Standards arising from AASB 8
AASB Interpretation 13 � Customer Loyalty Programmes
AASB Interpretation 14 AASB 119— � The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
ERR Erratum: � Proportionate Consolidation [AASB 101, AASB 107, AASB 121, AASB 127, Interpretation 113]
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
131Australian Industrial Registry 2007–08 Annual Report
5Appendix
Interpretation 10: � Interim Financial Reporting and Impairment
Interpretation 11: � Group and Treasury Share Transactions
Interpretation 1003: � Australian Petroleum Resource Rent Tax
Future Australian Accounting Standards Requirements
The following new standards, amendments to standards or interpretations have been issued by the Australian Accounting Standards Board but are effective for future reporting periods. It is estimated that the impact of adopting these pronouncements when effective will have no material financial impact on future reporting periods.
AASB 101: � Presentation of Financial Statements (issued September 2007)
AASB 123: � Borrowing Costs
AASB 1004: � Contributions
AASB 1049: � Whole of Government and General Government Sector Financial Reporting
AASB 1050: � Administered Items
AASB 1051: � Land Under Roads
AASB 1052: � Disaggregated Disclosures
AASB 2007–2: � Amendments to Australian Accounting Standards arising from AASB Interpretation 12 [AASB 1, AASB 117, AASB 118, AASB 120, AASB 121, AASB 127, AASB 131 & AASB 139]
AASB 2007–3: � Amendments to Australian Accounting Standards arising from AASB 8
AASB 2007–6: � Amendments to Australian Accounting Standards arising from AASB 123
AASB 2007–8: � Amendments to Australian Accounting Standards arising from AASB 101
AASB 2007–9: � Amendments to Australian Accounting Standards arising from the Review of AASs 27, 29 and 31 [AASB 3, AASB 5, AASB 8, AASB 101, AASB 114, AASB 116, AASB 127 & AASB 137]
AASB 2008–1: � Amendments to Australian Accounting Standard—Share-based Payments: Vesting Conditions and Cancellations [AASB 2]
AASB 2008–2: � Amendments to Australian Accounting Standard—Puttable Financial Instruments and Obligations arising on Liquidation [AASB 7, AASB 101, AASB 132, AASB 139 & Interpretation 2]
AASB 2008–3: � Amendments to Australian Accounting Standard arising from AASB 3 and AASB 127 [AASBs 1, 2, 4, 5, 7, 101, 107, 112, 114, 116, 121, 128, 131, 132, 133, 134, 136, 137, 138 & 139 and Interpretations 9 & 107]
Interpretation 1: � Changes in Existing Decommissioning, Restoration and Similar Liabilities
Interpretation 4: � Determining Whether an Arrangement Contains a Lease
Interpretation 12: � Service Concession Arrangements
Interpretation 13: � Customer Loyalty Programmes
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
132 2007–08 Annual Report Australian Industrial Registry
5Appendix
Interpretation 14: � AASB 119—The Limit on a Defined Benefit Asset, Minimum Funding Requirements and their Interaction
Interpretation 129: � Service Concession Arrangements Disclosures
Interpretation 1038: � Contributions by Owners Made To Wholly-Owned Public Sector Entities
Other
The following standards and interpretations have been issued but are not applicable to the operations of the AIR.
AASB 3: � Business Combinations
AASB 8: � Operating Segments
AASB 127: � Consolidated and Separate Financial Statements
Interpretation 13: � Customer Loyalty Programmes
AASB 1049 Whole Financial Reporting of General Government Sectors by Government
AASB 1049 specifies the reporting requirements for the General Government Sector. The FMOs does not apply to this reporting or the consolidated financial statements of the Australian Government.
1.5 Revenue
(a) Revenue from Government
Amounts appropriated for Departmental outputs appropriations for the year (adjusted for any formal additions and reductions) are recognised as revenue when the agency gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned.
Appropriations receivable are recognised at their nominal amounts.
(b) Other Types of Revenue
The AIR receives rental income from the sub-leasing of space within the Melbourne, Sydney and Perth AIR offices. Revenue from rendering of services is recognised by reference to the stage of completion of contracts and transaction costs can be reliably measured, and when probable economic benefits with the transaction will flow to the AIR.
The stage of completion of contracts at the reporting date is determined by reference to the proportion that costs incurred to date bear to the estimated total costs of the transaction.
Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any allowance for impairments. Collectability of debts is reviewed at balance date. Allowances are made when collectability of the debt is no longer probable.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
133Australian Industrial Registry 2007–08 Annual Report
5Appendix
1.6 Gains
(a) Resources Received Free of Charge
Resources received free of charge are recognised as gains when and only when a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense.
Contributions of assets at no cost of acquisition or for nominal consideration are recognised at their fair value when the asset qualifies for recognition, unless received from another Government Agency or Authority as a consequence of a restructuring of administrative arrangements (refer to Note 1.7).
Resources received free of charge are recorded as either revenue or gains depending on their nature.
(b) Sale of Assets
Gains from the disposal of non-current assets are recognised when control of the asset has passed to the buyer.
1.7 Transactions with the Government as Owner
(a) Equity Injections
Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) are recognised directly in Contributed Equity in that year.
(b) Restructuring of Administrative Arrangements
Net assets received from or relinquished to another Australian Government Agency or Authority under a restructuring of administrative arrangements are adjusted at their book value directly against contributed equity.
(c) Other Distributions to Owners
The FMOs require that distributions to owners be debited to contributed equity unless in the nature of a dividend. In 2007–08, by agreement with the Department of Finance and Deregulation, the AIR reduced its appropriation under subsection 9(1) of Appropriations Act (No. 1) 2007–08 by $185,000 due to the application of the one-off two percent efficiency dividend.
1.8 Employee Benefits
Employee Benefits includes benefits paid to Presidential Members, Commissioners and AIR staff.
Liabilities for services rendered by employees are recognised at the reporting date to the extent that they have not been settled.
Liabilities for ‘short-term employee benefits’ (as defined in AASB 119) and termination benefits due within 12 months of balance date are measured at their nominal amounts. The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
134 2007–08 Annual Report Australian Industrial Registry
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All other employee benefit liabilities are measured as the present value of the estimated future cash outflows to be made in respect of services provided by employees up to the reporting date.
(a) Leave
The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of the AIR is estimated to be less than the annual entitlement for sick leave.
The leave liabilities are calculated on the basis of employees’ remuneration, including the AIR’s employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.
The liability for long service leave is based on the AIR’s estimated liability at balance date of the long service leave entitlements of its employees. Eligible employees (including Commissioners) accrue 3 months long service leave after 10 years service, and progressively thereafter on a proportional basis. The non-current portion of the liability for long service leave is recognised and measured at the present value of the estimated future cash flows to be made in respect of all employees at 30 June 2008. The liability for long service leave is measured at the present value of estimated future cash outflows using market yields as at the reporting date on ‘national government bonds’.
Presidential Members accrue 6 months long leave after 5 years of service as a presidential member. In recognition of the nature of Presidential Members’ tenure, a provision is accrued from the first year of service.
(b) Superannuation
Staff of the AIR and Commissioners of the AIRC are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS) or the PSS Accumulation Plan (PSSap). The CSS and PSS are defined benefit schemes for the Australian Government. The PSSap is a defined contribution scheme. The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. The liability is reported by the Department of Finance and Deregulation as an administered item.
The AIR makes employer contributions to the employee superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government of the superannuation entitlements of the AIR’s employees. The AIR accounts for the contributions as if they were contributions to defined contribution plans.
From 1 July 2005, new employees are eligible to join the PSSap scheme.
The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
135Australian Industrial Registry 2007–08 Annual Report
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(c) Judges’ Pensions
Presidential Members of the AIRC are members of the Judges’ Pension Scheme under the Judges’ Pensions Act 1968. The fund, as at 30 June 2008, was carrying liabilities for member’s benefits which exceeded the scheme’s assets. The liability and payments are recorded as part of the Attorney-General’s Department’s financial statements. The Attorney-General’s Department has given the AIR drawing rights for this financial year in relation to the special appropriation made under the Judges’ Pensions Act 1968. The AIR makes pension payments directly to former Presidential Members of the AIRC (refer to Note 16c).
1.9 Leases
A distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and rewards incidental to ownership of leased non-current assets. An operating lease is a lease that is not a finance lease. In operating leases, the lessor effectively retains substantially all such risks and benefits.
Operating lease payments are expensed on a basis which is representative of the pattern of benefits derived from the leased assets.
Lease incentives taking the form of ‘free’ leasehold improvements and rent holidays are recognised as liabilities. These liabilities are reduced by allocating lease payments between rental expense and reduction of the liability.
1.10 Cash and Cash Equivalents
Cash and cash equivalents includes notes and coins held and any deposits in bank accounts with an original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value. Cash is recognised at its nominal amount.
1.11 Financial Assets and Financial Liabilities
The AIR classifies its financial assets in the following categories:
cash and cash equivalent; and �
trade and other receivables. �
The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Financial assets are recognised and derecognised upon ‘trade date’.
Effective interest method
The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, or, when appropriate, a shorter period.
Income is recognised on an effective interest rate basis except for financial assets ‘at fair value through profit or loss’.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
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Loan and Receivables
Trade receivables and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘trade and other receivables’. They are included in current assets. Receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.
Impairment of financial assets
Financial assets are assessed for impairment at each balance date.
Financial assets held at amortised cost � —If there is objective evidence that an impairment loss has been incurred for loans and receivables or held to maturity investments held at amortised cost, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate. The carrying amount is reduced by way of an allowance account. The loss is recognised in the Income Statement.
1.12 Financial Liabilities
Financial liabilities are classified as suppliers and other payables. Financial liabilities are recognised and derecognised upon ‘trade date’.
Suppliers and Other Payables
Suppliers and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).
1.13 Contingent Liabilities and Contingent Assets
Contingent Liabilities and Contingent Assets are not recognised in the Balance Sheet, but are reported in the relevant schedules and notes. They may arise from uncertainty as to the existence of a liability or asset, or represent an existing liability or asset in respect of which settlement is not probable or the amount cannot be reliably measured. Contingent assets are reported when settlement is probable but not virtually certain, and contingent liabilities are recognised when settlement is greater than remote (refer to Note 15).
1.14 Acquisition of Assets
Assets are recorded at their cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate.
Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and revenues at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements. In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor agency’s accounts immediately prior to the restructuring.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
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1.15 Buildings, Plant and Equipment
(a) Asset Recognition Threshold
Purchases of buildings, plant and equipment are recognised initially at cost in the Balance Sheet, except for purchases costing less than:
$10,000 for leasehold improvements; and $1,000 for all other classes.
which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).
The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make-good’ provisions in property leases taken up by the AIR where there exists an obligation to restore the property to its original condition. These costs are included in the value of the AIR’s leasehold improvements with a corresponding provision for the ‘make-good’ recognised.
(b) Revaluations
Buildings, plant and equipment are carried at fair value, being revalued with sufficient frequency such that the carrying amount of each asset class is not materially different, at reporting date, from its fair value.
Fair values for each class of assets are determined as shown below.
Asset Class Fair value measured at:
Buildings—leasehold improvements depreciated replacement cost
Plant & equipment depreciated replacement cost
Under ‘fair value’ assets which are surplus to requirements are measured at their net realisable value. At 30 June 2008, the AIR did not have any assets in this situation.
Following initial recognition at cost, buildings, plant and equipment are carried at fair value less accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amount of assets do not differ materially from the assets’ fair values as at the reporting date. It is expected that the independent valuations will be undertaken once every three to five years. All valuations are conducted by an independent qualified valuer.
Revaluation adjustments are made on a class basis. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reverses a previous revaluation decrement of the same asset class that was previously recognised through operating results. Revaluation decrements for a class of assets are recognised directly through operating results except to the extent that they reverse a previous revaluation increment for that class.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
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Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the net amount restated to the revalued amount of the asset.
(c) Depreciation
Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful life to the AIR using, in all cases, the straight-line method of depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease.
Depreciation rates (useful lives) and methods are reviewed at each balance date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate. Residual values are re-estimated for a change in prices when assets are revalued.
Depreciation and amortisation rates applying to each class of depreciable asset are based on the following useful lives:
2008 2007
Buildings—leasehold improvements Lease term Lease term
Plant and equipment 3 to 10 years 3 to 10 years
The aggregate amount of depreciation allocated for each class of asset during the reporting period is disclosed in Note 4c.
Impairment
All non-financial assets were assessed for impairment at 30 June 2008. Where indicators of impairment exist, the assets recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.
The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the AIR were deprived of the asset, its value in use is taken to be its depreciated replacement cost.
No indicators of impairment were found for assets at fair value.
1.16 Intangibles
The AIR’s intangibles comprise internally developed and externally purchased computer software for internal use. These assets are carried at cost.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
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Software is amortised on a straight-line basis over its anticipated useful life. Useful lives are:
2008 2007
Intangibles—computer software 3 to 10 years 3 to 10 years
All software assets were assessed for indications of impairment as at 30 June 2008. None were found to be impaired.
1.17 Decommissioning, Restoration and Make-Good Provision
When assessing accommodation leases for the preparation of the opening balance sheet, lease obligations for make-good were identified for the Sydney and Darwin premises. Make-good provisions for premises are made in accordance with the terms of the relevant lease agreements, and are based on estimates of the square metres cost of make-good provided by independent consultants.
1.18 Taxation
The AIR is exempt from all forms of taxation except fringe benefits tax (FBT) and the goods and services tax (GST).
Revenues, expenses and assets are recognised net of GST:
except where the amount of GST incurred is not recoverable from the Australian Taxation Office; �and
except for receivables and payables. �
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
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1.19 Reporting of Administered Activities
Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the Schedule of Administered Items and related Notes.
Except where otherwise stated below, administered items are accounted for on the same basis and using the same policies as for Departmental items, including the application of Australian Accounting Standards.
The AIR has been granted authority and drawing rights by the Attorney-General’s Department to make payments to former Presidential Members of the AIRC under the Judges’ Pensions Act 1968 (Note 16c).
(a) Administered Cash Transfers to and from Official Public Account
Revenue collected by the AIR for use by the Government rather than the AIR is Administered Revenue. Collections are transferred to the Official Public Account (OPA) maintained by the Department of Finance and Deregulation. Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriation on behalf of Government. These transfers to and from the OPA are adjustments to the administered cash held by the Agency on behalf of the Government and reported as such in the Statement of Cash Flows in the Schedule of Administered Items and in the Administered Reconciliation Table in Note 14. The Schedule of Administered Items largely reflects the Government’s transactions, through the AIR, with parties outside the Government.
(b) Revenue
All administered revenues are revenues relating to core operating activities performed by the AIR on behalf of the Australian Government. The AIR receives revenue from fees charged for lodgment of unlawful dismissals. Administered revenue is recognised when the lodgment is processed.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
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Note 2: Events Occurring after Reporting Date
There were no significant events that occurred after 30 June 2008, but prior to the signing of the financial statements, that would affect the ongoing structure and financial activities of the AIR.
Note 3: Income
2008 2007
$’000 $‘000
Revenue
Note 3a Revenue from Government
Appropriations:
Departmental outputs 53,683 66,450
Total revenue from Government 53,683 66,450
Note 3b Rendering of services
Rendering of services—external parties 76 43
Total rendering of services 76 43
Note 3c Rental income
Operating lease:
Sub-lease of Property 685 -
Total rental income 685 -
Note 3d Other revenues
Other revenue 38 36
Total other revenue 38 36
Gains
Note 3e Sale of assets
Plant and equipment:
Proceeds from sale 3 34
Carry value of assets sold - (4)
Net gain from sale of assets 3 30
Note 3f Other gains
Resources received free of charge 24 23
Write-back of make-good provision - 100
Total rental income 24 123
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 4: Expenses
2008 2007
$’000 $‘000
Note 4a Employee benefits
Wages and salaries 19,926 19,935
Superannuation
Defined benefit plan 1,933 2,398
Defined contribution plan 621 620
Leave and other entitlements 2,921 1,763
Separation and redundancies - 193
Other employee expenses 1,228 1,269
Total employee benefits 26,629 26,178
Note 4b Suppliers
Provision of goods—external parties 1,140 939
Rendering of services—related entities 229 1,163
Rendering of services—external parties 7,005 15,433
Operating lease rentals:
Minimum lease payments 9,945 11,253
Workers compensation premiums 108 81
Total supplier expenses 18,427 28,869
Note 4c Depreciation and amortisation
Depreciation
Leasehold improvements 388 347
Plant and equipment 273 286
Total depreciation 661 633
Amortisation
Intangibles:
Computer software 159 166
Total amortisation 159 166
Total depreciation and amortisation 820 799
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
2008 2007
$’000 $‘000
Note 4d Finance costs
Unwinding of discount 151 267
Total finance costs 151 267
Note 4e Write-down and impairment of assets
Asset write-downs from
Impairment of buildings, plant and equipment 13 77
Total write-down and impairment of assets 13 77
Note 4f Losses from assets sales
Plant and equipment
Proceeds from sale 5 -
Total losses from assets sales 5 -
Note 4g Liquidated damages
Liquidated damages - 1,853
Total finance costs - 1,853
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 5: Financial Assets
2008 2007
$’000 $‘000
Note 5a Cash and cash equivalents
Cash at bank 236 430
Cash on hand or on deposit 6 6
Advance account 10 10
Total cash and cash equivalents 252 446
Note 5b Trade and other receivables
Goods and services 100 4
Appropriations receivable:
for existing outputs 42,120 34,235
Total appropriations receivable 42,220 34,239
GST receivable from the Australian Taxation Office 179 164
Other receivables (2) (1)
Total other receivables (2) (1)
Total trade and other receivables 42,397 34,402
Receivables are represented by:
Current 42,397 34,402
Non-current - -
Total trade and other receivables 42,397 34,402
Receivables are aged as follows:
Not overdue 42,394 34,402
Overdue by:
Less than 30 days - -
30 to 60 days - -
61 to 90 days - -
More than 90 days 3 -
Total receivables 42,397 34,402
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 6: Non-financial Assets
2008 2007
$’000 $’000
Note 6a Buildings—leasehold improvements
Leasehold improvements
– fair value 12,905 17,549
– accumulated depreciation (9,649) (14,655)
Total buildings—leasehold improvements (non-current) 3,256 2,894
No leasehold improvements revaluations was undertaken during 2007–08.
No indicators of impairment were found for buildings.
Note 6b Plant and equipment
Plant and equipment:
– gross carrying value (at fair value) 1,755 2,654
– accumulated depreciation (728) (796)
Total plant and equipment (non-current) 1,027 1,858
All revaluations are conducted in accordance with the revaluation policy stated at Note 1. In 2007–08, an independent valuer, Rushton Valuers, conducted the revaluation on Artwork.
Revaluation decrement of $19,271 for plant and equipment was debited to the asset revaluation reserve by asset class and included in the equity section of the balance sheet; no decrements were expensed.
No indicators of impairment were found for plant and equipment.
Note 6c Intangibles
Computer software at cost:
Internally developed—in use 1,185 1,797
Internally developed—in progress 542 134
Total computer software 2,357 1,931
Accumulated amortisation 1,361 1,202
Total intangibles (non-current) 996 729
No indicators of impairments were found for intangible assets.
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
2008 2007
$’000 $‘000
Note 6d Other non-financial assets
Prepayments 1,166 1,133
Lease incentive 70 -
Total other non-financial assets 1,236 1,133
All other non-financial assets are current assets.
No indicators of impairment were found for other non-financial assets.
Note 6e Analysis of property, plant and equipment
Table A—Reconciliation of the opening and closing balances of building, plant and equipment (2007–08)
ItemLeasehold
Improvements$’000
Plant and Equipment
$’000Total$’000
As at 1 July 2007
Gross book value 17,549 2,861 20,410
Accumulated depreciation and impairment (14,655) (1,003) (15,658)
Net book value 1 July 2007 2,894 1,858 4,752
Additions:
by purchase 129 99 228
Net revaluation (decrement) - (20) (20)
Depreciation expense (388) (273) (661)
Impairments recognised in opening balance - 30 30
Other movements:
– transfer between asset class 655 (655) -
– make-good (34) - (34)
Disposals - (12) (12)
Net book value 30 June 2008 3,256 1,027 4,283
Net book value as of 30 June 2008 as represented by:
Gross book value 12,905 1,755 14,660
Accumulated amortisation and impairment (9,649) (728) (10,377)
3,256 1,027 4,283
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Table B—Reconciliation of the opening and closing balances of building, plant and equipment (2006–07)
ItemLeasehold
Improvements$’000
Plant and Equipment
$’000Total$’000
As at 1 July 2006
Gross book value 16,818 906 17,724
Accumulated depreciation and impairment (14,308) (717) (15,025)
Net book value 1 July 2006 2,510 189 2,699
Additions:
by purchase 807 1,959 2,766
Depreciation expense (347) (286) (633)
Other movements—make-good 488 - 488
Disposals (564) (4) (568)
Net book value 30 June 2007 2,894 1,858 4,752
Net book value as of 30 June 2007 as represented by:
Gross book value 17,549 2,861 20,410
Accumulated depreciation and impairment (14,655) (1,003) (15,658)
2,894 1,858 4,752
Note 6f Analysis of intangibles
Table C—Reconciliation of the opening and closing balances of intangibles (2007–08)
ItemIntangibles
$’000Total$’000
As at 1 July 2007
Gross book value 1,931 1,931
Accumulated amortisation and impairment (1,202) (1,202)
Net book value 1 July 2007 729 729
Additions:
by purchase or internally developed 426 426
Amortisation (159) (159)
Net book value 30 June 2008 996 996
Net book value as of 30 June 2008 represented by:
Gross book value 2,357 2,357
Accumulated amortisation and impairment (1,361) (1,361)
Net book value 30 June 2008 996 996
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Table D—Reconciliation of the opening and closing balances of intangibles (2006–07)
ItemIntangibles
$’000Total$’000
As at 1 July 2006
Gross book value 1,708 1,708
Accumulated amortisation and impairment (1,035) (1,035)
Net book value 1 July 2006 673 673
Additions:
by purchase or internally developed 223 223
Amortisation (167) (167)
Net book value 30 June 2007 729 729
Net book value as of 30 June 2007 represented by:
Gross book value 1,931 1,931
Accumulated amortisation and impairment (1,202) (1,202)
729 729
Note 7: Payables
2008 2007
$’000 $‘000
Note 7a Suppliers
Trade creditors 668 1,306
Unearned revenue - 15
Total supplier payables 668 1,321
Supplier payables are represented by:
Current 668 1,321
Non-current - -
Total supplier payables 668 1,321
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 8: Provisions
2008 2007
$’000 $‘000
Note 8a Employee provisions
Salaries and Wages 271 216
Leave 10,523 10,136
Superannuation 24 228
Total employee provisions 10,818 10,528
Employee provisions are represented by:
Current 10,167 9,129
Non-current 651 1,451
Total employee provisions 10,818 10,580
The classification of current includes amounts for which there is not an unconditional right to defer settlement by one year, hence in the case of employee provisions the above classification does not represent the amount expected to be settled within one year of reporting date. Employee provisions expected to be settled in twelve months from the reporting date are $2,692,498 (2007: $2,008,768), and in excess of one year $7,830,386 (2007: $8,126,958).
Note 8b Other provisions
Leasehold make-good 2,426 2,319
Lease incentives 3,113 3,558
Leasehold provisions 1,853 1,853
Total other provisions 7,402 7,730
Other provisions are represented by:
Current 889 1,875
Non-current 6,513 5,855
Total other provisions 7,402 7,730
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Leasehold make-good
$’000
Lease incentives
$’000
Leasehold provisions
$’000Total $’000
Carrying amount 1 July 2007 2,319 3,558 1,853 7,730
Additional provisions made 1 - - 1
Amounts used (35) (445) - (480)
Finance cost 151 - - 151
Closing balance 2008 2,436 3,113 1,853 7,402
The AIR currently has two agreements for the leasing of premises which have provisions requiring the AIR to restore the premises to their original condition at the conclusion of the lease. The AIR has made a provision to reflect the present value of this obligation.
Note 9: Cash Flow Reconciliation
2008 2007
$’000 $‘000
Reconciliation of operating result to net cash from operating activities:
Operating result 8,464 8,639
Depreciation/amortisation 820 799
Net gain from write-back of make-good provision - (100)
Gain on disposal of assets (3) (30)
Loss on write-back of assets 18 77
(Increase)/decrease in net receivables (7,994) (5,576)
(Increase)/decrease in other non-financial assets (103) 1,414
Increase/(decrease) in employee provisions 238 51
Increase/(decrease) in supplier payables (639) 94
Increase/(decrease) in unearned income (15) 9
Increase/(decrease) in payable to the OPA - (3,180)
Increase/(decrease) in other provisions (329) 1,188
Net cash from (used by) operating activities 457 3,385
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 10: Contingent Liabilities and Assets
Quantifiable Contingencies
There were no quantifiable contingent liabilities or assets requiring disclosure for 2007–08 or 2006–07.
Unquantifiable Contigencies
There were no unquantifiable contingent liabilities or assets requiring disclosure for 2007–08 or 2006–07.
Note 11: Senior Executive Remuneration
The number of executive officers who received or were due to receive total remuneration of $130,000 or more:
2008 2007
$145,000 to $159,999 - 1
$160,000 to $174,999 - -
$175,000 to $189,999 - -
$190,000 to $204,999 - 1
$205,000 to $219,999 1 -
$220,000 to $234,999 - -
$235,000 to $249,999 - -
$250,000 to $264,999 1 -
Total 2 2*
The aggregate amount of total remuneration of senior executives shown above. $468,629 $352,901*
* One executive in 2007 was only part of the year.
Note 12: Remuneration of Auditors
Financial statement audit services are provided free of charge to the AIR.
2008$’000
2007
$’000
The fair value of the services provided was: 24 23
24 23
No other services were provided by the Auditor-General.
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 13: Financial Instruments
2008 2007
$’000 $‘000
Note 13a Categories of financial instruments
Financial Assets
Loans and receivables financial assets
Cash and cash equivalents 252 446
Trade receivables 98 4
350 450
Carrying amount of financial assets 350 450
Financial Liabilities
Other liabilities
Payables—suppliers 668 1,306
668 1,306
Carrying amount of financial assets 668 1,306
Note 13b Net income and expense from financial assets
There is no income or expense from financial assets—loans and receivables in the year ending 30 June 2008. (2007: nil)
Note 13c Net income and expense from financial liabilities
There is no income or expense from financial liabilities—payable in the year ending 30 June 2008. (2007: nil)
Note 13d Fair value of financial instruments
There are no financial instruments held at 30 June 2008 where the carrying amount is not a reasonable approximation of fair value. (2007: nil)
Note 13e Credit risk
The AIR is exposed to minimal credit risk as loans and receivables are cash and trade receivables. The maximum exposure to credit risk is the risk that arises from potential default of a debtor. This is equal to the total of trade receivables (2008: $94,000 and 2007: $3,000). The AIR’s debtors are generally limited to other Commonwealth Government agencies and AIR and AIRC employees. The AIR has policies and procedures that guide the recovery of employee debts.
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
The AIR has no significant exposure to any concentrations of credit risk.
All figures for credit risk referred to do not take into account the value of any collateral or other security.
Credit quality of financial instruments not past due or individually determined as impaired.
Not Past Due Nor Impaired
Not Past Due Nor Impaired
Past Due or Impaired
Past Due or Impaired
2008 2007 2008 2007
$’000 $’000 $’000 $’000
Loans and receivables
Trade receivables 98 3 2 1
Total 98 3 2 1
Ageing of financial assets that are past due but not impaired for 2008
0 to 30 days 31 to 60 days 61 to 90 days 90+ days Total
$’000 $’000 $’000 $’000 $’000
Loans and receivables
Trade receivables - - - 2 2
Total - - - 2 2
Ageing of financial assets that are past due but not impaired for 2007
0 to 30 days 31 to 60 days 61 to 90 days 90+ days Total
$’000 $’000 $’000 $’000 $’000
Loans and receivables
Trade receivables - - - 1 1
Total - - - 1 1
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 13f Liquidity risk
The AIR’s financial liabilities are payables. The exposure to liquidity risk is based on the notion that the AIR will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to appropriation funding and mechanisms available to the AIR (e.g. Advance to the Finance Minister) and internal policies and procedures put in place to ensure there are appropriate resources to meet its financial obligations.
The AIR is appropriated funding from the Australian Government. The AIR manages its budgeted funds to ensure it has adequate funds to meet payments as they fall due. In addition, the AIR has policies in place to ensure timely payments are made when due and has no past experience of default.
All financial liabilities mature within one year (2007: one year).
The following tables illustrate the maturities for financial liabilities.
On demand 2008 $’000
within 1 year 2008 $’000
1 to 5 years 2008 $’000
>5 years 2008 $’000
Total 2008 $’000
Other liabilities
Trade creditors - 668 - - 668
Unearned revenue - - - - -
Total - 668 - - 668
On demand 2007 $’000
within 1 year 2007 $’000
1 to 5 years 2007 $’000
>5 years 2007 $’000
Total 2007 $’000
Other liabilities
Trade creditors - 1,306 - - 1,306
Unearned revenue - 15 - - 15
Total - 1,321 - - 1,321
Note 13g Market risk
The AIR holds basic financial instruments that do not expose the AIR to certain market risks.
The AIR is not exposed to currency risk, other price risk or interest rate risk.
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 14: Administered Reconciliation Table
2008 2007
$’000 $‘000
Opening administered assets less administered liabilities
as at 1 July - 5,677
Plus: Administered income 272 197
Less:
Administered write-down of lease incentive - 6,493
Administered liability transferred to Departmental - 1,853
Administered GST liability transferred to Departmental - 1,000
Transfers to OPA (272) (15,220)
Closing administered assets less administered liabilities as at 30 June - -
Note 15: Administered Contingent Liabilities and Assets
As at 30 June 2008 there were no unrecognised or contingent liabilities or unrecognised or contingent assets requiring disclosure.
Financial Statements
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 16: Appropriations
Table A—Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for Ordinary Annual Services Appropriations
Departmental Outputs Total
Particulars2008$’000
2007
$’000
2008$’000
2007
$’000
Balance brought forward from previous period
26,043 17,027 26,043 17,027
Appropriation Act:
Appropriation Act (No. 1) 2007–08 53,868 58,067 53,868 58,067
Appropriation Act (No. 3) 2007–08 - 8,383 - 8,383
Reductions of appropriations (Appropriations Act s9)
(185) - - -
FMA Act:
Appropriations to take account of recoverable GST (FMA s30A)
1,793 3,685 1,793 3,685
Annotations to ‘net appropriations’ (FMA s31)
861 139 861 139
Total appropriations available for payments 82,380 87,301 82,380 87,301
Cash payments made during the year (GST inclusive)
(48,632) (61,258) (48,632) (61,258)
Balance of Authority to Draw Cash from the Consolidated Revenue Fund for Ordinary Annual Services Appropriations
33,748 26,043 33,748 26,043
Represented by
Cash at bank and on hand 252 446 252 446
Departmental appropriations receivable 33,317 25,433 33,317 25,433
Receivable—GST receivable 179 164 179 164
Total 33,748 26,043 33,748 26,043
Departmental and non-operating appropriations do not lapse at financial year end. However, the responsible Minister may decide that part of all of a departmental or non-operating appropriation is not required and request the Finance Minister to reduce that appropriation. In 2007–08, a determination was sought to reduce the AIR’s departmental appropriation from Appropriation Act (No. 1) 2007–08 by $185,000 after the application of the one-off two percent efficiency dividend.
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NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Table B—Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for other than Ordinary Annual Services Appropriations
Departmental Outputs Total
Particulars2008$’000
2007
$’000
2008$’000
2007
$’000
Balance brought forward from previous period
8,802 2,125 8,802 2,125
Appropriation Act:
Appropriation Act (No. 2) 2007–08 - - - -
Appropriation Act (No. 4) 2007–08 - 6,677 - 6,677
Appropriation Act (No. 6) 2007–08 - - - -
FMA Act:
Appropriations to take account of recoverable GST (FMA s30A)
- - - -
Total appropriations available for payments 8,802 8,802 8,802 8,802
Cash payments made during the year (GST inclusive)
- - - -
Balance of Authority to Draw Cash from the Consolidated Revenue Fund for other than Ordinary Annual Services Appropriations
8,802 8,802 8,802 8,802
Represented by
Appropriation receivable 8,802 8,802 8,802 8,802
Total 8,802 8,802 8,802 8,802
Table C—Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund—Special Appropriations (Unlimited Amount)
During the year, the AIR was granted authority and drawing rights by the Attorney-General’s Department to make payments under the Judges’ Pensions Act 1968. The AIR makes pension payments directly to former Presidential Members of the AIRC.
Judges’ Pensions Act 1968 (Administered)
2008$’000
2007
$’000
Legal Authority: Judges’ Pensions Act 1968.
Purpose: To make payments to former Presidential Members of the Australian Industrial Relations Commission.
Total receipts 3,267 2,996
Total payments (3,267) (2,996)
Balance - -
Financial Statements
158 2007–08 Annual Report Australian Industrial Registry
5Appendix
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 17: Special Accounts
Other Trust Money Account 2008$’000
2007
$’000
Legal Authority: Financial Management and Accountability Act 1997.
Purpose: For expenditure of monies temporarily held on trust or otherwise for the benefit of a person other than the Commonwealth.
Balance carried from previous period - -
Other receipts 11 19
Total credits 11 19
Payments made 11 19
Total debits 11 19
Balance carried to the next period - -
Services for Other Government and Non-Agency Bodies Account
Legal Authority: Financial Management and Accountability Act 1997.
Purpose: For expenditure in connection with services performed on behalf of other Governments and bodies that are not Agencies under the FMA Act.
Balance carried from previous period - -
Other receipts - -
Total credits - -
Payments made - -
Total debits - -
Balance carried to the next period - -
159Australian Industrial Registry 2007–08 Annual Report
5Appendix
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 18: Compensation and Debt Relief
Administered 2008 $
2007 $
No ‘Act of Grace’ payments were made during the reporting period. (2007: No payments made)
- -
No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997. (2007: No waivers)
- -
No ex-gratia payments were made during the reporting period. (2007: No payments made)
- -
No payments were made under the ‘Defective Administration Scheme’ during the reporting period. (2007: No payments made)
- -
No payments were made under s.73 of the Public Service Act 1999 during the reporting period. (2007: No payments made)
- -
Departmental 2008 $
2007 $
No ‘Act of Grace’ payments were made during the reporting period. (2007: No payments made)
- -
No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997. (2007: No waivers)
- -
No ex-gratia payments were made during the reporting period. (2007: No payments made)
- -
No payments were made under the ‘Defective Administration Scheme’ during the reporting period. (2007: No payments made)
- -
No payments were made under s.73 of the Public Service Act 1999 during the reporting period. (2007: No payments made)
- -
Financial Statements
160 2007–08 Annual Report Australian Industrial Registry
5Appendix
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008
Note 19: Reporting of Outcome
The AIR determines the attribution of its shared items based on a survey of employee time spent on each activity and the salary paid to these employees. The basis of attribution in the table is consistent with the basis used for the 2007–08 Budget.
Note 19a Net Cost of Outcome Delivery
2008 2007
$’000 $‘000
Expenses
Administered - -
Departmental 46,045 58,043
Total expenses 46,045 58,043
Costs recovered from provision of goods and services to the non-government sector
Administered - -
Departmental 76 43
Total costs recovered 76 43
Other external revenues
Administered
Other taxes, fees and fines 272 197
Interest on cash deposits - -
Total Administered 272 197
Departmental
Interest on cash deposits - -
Other 38 36
Total Departmental 38 36
Total other external revenues 310 233
Net cost/(contribution) of outcome 45,659 57,767
The Outcome is described in Note 1.1. Net costs shown include intra-government costs that are eliminated in calculating the actual Budget Outcome.
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Note 19b Major Classes of Departmental Revenues and Expenses by Output Groups
Outcome 1
Output Group 1.1
Output Group 1.2
Output Group 1.3
Total
2008 $’000
2007 $’000
2008 $’000
2007 $’000
2008 $’000
2007 $’000
2008 $’000
2007 $’000
Departmental expenses
Employees 24,129 23,777 2,143 2,017 357 384 26,629 26,178
Suppliers 16,697 28,147 1,483 2,388 247 454 18,427 30,989
Depreciation and amortisation 743 725 66 62 11 12 820 799
Other expenses 153 70 14 6 2 1 169 77
Total departmental expenses 41,722 52,719 3,706 4,473 617 851 46,045 58,043
Funded by:
Revenues from Government 48,644 61,141 4,320 4,910 719 399 53,683 66,450
Sale of goods and services 69 40 6 3 1 - 76 43
Other non-taxation revenues 655 54 58 5 10 - 723 59
Gains 25 120 2 10 - - 27 130
Total departmental revenues 49,393 61,355 4,386 4,928 730 399 54,509 66,682
The Outcome is described in Note 1.1. Net costs shown include intra-government costs that are eliminated in calculating the actual Budget Outcome.
Note 19c Major Classes of Administered Revenues and Expenses by Outcome
Actual
2008 $’000
2007 $’000
Administered Revenues
Other non-taxation revenues 272 197
Interest on deposits - -
Liabilities transferred to Departmental - 2,853
Write-down of liability - 6,493
Total administered revenues 272 9,543
The Outcome is described in Note 1.1.
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS for the period ended 30 June 2008