statement of comprehensive income - national archives...
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Statement of Comprehensive Incomefor the period ended 30 June 2016
2016 2015
Original
Budget
2016
Notes $'000 $'000 $'000
NET COST OF SERVICES
Expenses
Employee benefits 1.1A 37 074 36 157 39 717
Supplier 1.1B 24 954 23 877 21 785
Depreciation and amortisation 2.2A 12 534 11 097 12 183
Grants 1.1C 20 62 40
Finance costs 37 32 60
Write-down and impairment of assets 1.1D 263 1 -
Losses from asset sales - 676 500
Other expenses 36 71 -
Total expenses 74 918 71 973 74 285
Own-source income
Own-source revenue
Sale of goods and rendering of services 1.2A 2 610 3 416 2 166
Rental income from sub-leases 1.2B 132 136 124
Other revenue 1.2C 8 956 11 984 10 000
Total own-source revenue 11 698 15 536 12 290
Gains
Other gains 2 5 76
Gains from asset sales 51 - -
Total gains 53 5 76
Total own-source income 11 751 15 541 12 366
Net cost of services 63 167 56 432 61 919
Revenue from Government Appropriations 1.2D/3.1A 58 297 59 009 59 176
Surplus/(Deficit) (4 870) 2 577 (2 743)
OTHER COMPREHENSIVE INCOME
Items not subject to subsequent reclassification to
net cost of services
Revaluation (decrement) / Increment (4 135) 19 719 -
Total other comprehensive income (4 135) 19 719 -
Total comprehensive income/(loss) (9 005) 22 296 (2 743)
Total comprehensive income/(loss) attributable to
the Australian Government (9 005) 22 296 (2 743)
The above statement should be read in conjunction with the accompanying notes.
This statement also represents the results for Outcome 1 as the Archives only has one outcome. Outcome 1 is described at the Overview note.
Statement of Comprehensive Incomefor the period ended 30 June 2016
Budget Variances Commentary Statement of Comprehensive Income Employee benefits The variance to the original budget is due to positions being vacant during the year as a result of staff separating from the Archives and the delay in filling these positions throughout the year. Supplier The variance to the original budget is due to additional suppliers expenditure incurred during the year as a result of staff vacancies. Loss from asset sales Loss from asset sales is primarily a result of changes in the status of Heritage and Cultural assets from Retain an National Archives (RNA) to temporary records. Where assets become classified as temporary they are removed from the collection value and disposed. Though this strategy was taken into account in the original budget, it has not incurred in 2015-16. Sale of goods and rendering of services Sale of goods and Rendering of Services was greater then the original budget due to sponsorship revenue being received by the Archives that is used towards the development and touring of our exhibition program. Other Revenue The Variance is due to less than budgeted intake of Collection Items during the year. The collection intake primarily relates to Archival records that are received from other Commonwealth Government Agencies and the value varies depending on the number and types of records that are transferred to the Archives custody during the year.
Statement of Financial Positionas at 30 June 2016
2016 2015
Original
Budget
2016
Notes $'000 $'000 $'000
ASSETS
Financial assets
Cash and cash equivalents 2.1A 199 171 186
Trade and other receivables 2.1B 19 260 21 854 21 337
Total financial assets 19 459 22 025 21 523
Non-financial assets
Property, plant and equipment 2.2A 1 481 863 1 477 942 1 459 201
Intangibles 2.2A 16 875 16 212 15 582
Inventories 142 198 231
Other non-financial assets - Prepayments 1 442 1 307 1 072
Total non-financial assets 1 500 322 1 495 659 1 476 086
Total assets 1 519 781 1 517 684 1 497 609
LIABILITIES
Payables
Suppliers 2.3A 1 204 3 165 1 940
Other payables 2.3B 1 277 1 461 2 573
Total payables 2 481 4 626 4 513
Provisions
Employee provisions 4.1 12 189 11 725 12 645
Provision for restoration 2.4A 9 583 1 867 1 960
Total provisions 21 772 13 592 14 605
Total liabilities 24 253 18 218 19 118
Net assets 1 495 528 1 499 466 1 478 491
EQUITY
Contributed equity 37 267 32 201 38 069
Reserves 346 337 350 471 330 752
Retained surplus 1 111 924 1 116 794 1 109 670
Total equity 1 495 528 1 499 466 1 478 491
The above statement should be read in conjunction with the accompanying notes.
This statement also represents the results for Outcome 1 as the Archives only has one outcome. Outcome 1 is described at the Overview note.
Budget Variances Commentary Statement of Financial Position Property, plant and equipment The value of property, plant and equipment was greater than budget due to the revaluation of Heritage and Cultural Assets in 2014-15 which increased the value of the assets by $23 million after the budget was completed. Provision for restoration Provision for restoration increased during 2015-16 as a result of the independent revaluation of properties leased by the Archives which have a make good provision in the lease. The cost of the make good increased due to the increased cost to remediate the sites and the complexity and scale of the fit-out increased, in particular the upgrade of Chester Hill's storage facility.
Statement of Changes in Equity
for the period ended 30 June 2016
2016 2015
Original
Budget
2016
Notes $’000 $’000 $’000
CONTRIBUTED EQUITY
Opening balance
Balance carried forward from previous period 32 201 26 290 32 201
Contributions by owners
Departmental capital budget 5 066 5 911 5 868
Closing balance as at 30 June 37 267 32 201 38 069
RETAINED EARNINGS
Opening balance
Balance carried forward from previous period 1 116 794 1 114 217 1 112 413
Comprehensive income
Surplus/(Deficit) for the period (4 870) 2 577 (2 743)
Closing balance as at 30 June 1 111 924 1 116 794 1 109 670
ASSET REVALUATION RESERVE
Opening balance
Balance carried forward from previous period 350 471 330 752 330 752
Comprehensive income
Other comprehensive income (4 134) 19 719 -
Closing balance as at 30 June 346 337 350 471 330 752
TOTAL EQUITY
Opening balance
Balance carried forward from previous period 1 499 466 1 471 259 1 475 366
Comprehensive income
Surplus/(Deficit) for the period (4 870) 2 577 (2 743)
Other comprehensive income (4 134) 19 719 -
Total comprehensive income (9 004) 22 296 (2 743)
Transactions with owners
Contributions by owners
Departmental capital budget 5 066 5 911 5 868
Total transactions with owners 5 066 5 911 5 868
Closing balance as at 30 June 1 495 528 1 499 466 1 478 491
The above statement should be read in conjunction with the accompanying notes.
This statement also represents the results for Outcome 1 as the Archives only has one outcome. Outcome 1 is described at the Overview note.
Significant Accounting Policy Equity Injections Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) and Departmental Cap ital Budgets (DCBs) are recognised directly in contributed equity in that year.
Budget Variances Commentary Statement of Changes in Equity Departmental Capital Budget Department Capital Budget was less than the original budget due to a government one-off efficiency saving announced during 2015-16.
Cash Flow Statementfor the period ended 30 June 2016
2016 2015
Original
Budget
2016
Notes $'000 $'000 $'000
OPERATING ACTIVITIES
Cash received
Appropriations 65 313 62 337 59 176
Sales of goods and rendering of services 3 449 3 361 2 290
Net GST received 2 716 2 524 3 176
Other cash received 52 129 ( 133)
Total cash received 71 530 68 351 64 509
Cash used
Employees 37 703 35 817 39 797
Suppliers 30 052 27 361 24 672
Grants 20 62 -
Section 74 receipts transferred to OPA 3 967 3 445 -
Other cash used 36 71 40
Total cash used 71 778 66 756 64 509
Net cash from / (used by) operating activities 3.3 ( 248) 1 595 -
INVESTING ACTIVITIES
Cash received
Proceeds from sales of property, plant and equipment 51 18 -
Total cash received 51 18 -
Cash used
Purchase of property, plant and equipment 2 880 5 745 5 868
Purchase of intangibles 1 961 1 794
Total cash used 4 841 7 539 5 868
Net cash used by investing activities (4 790) (7 521) (5 868)
FINANCING ACTIVITIES
Cash received
Contributed equity 5 066 5 911 5 868
Total cash received 5 066 5 911 5 868
Net cash from financing activities 5 066 5 911 5 868
Net decrease in cash held 28 (15) -
Cash and cash equivalents at the beginning of the
reporting period 171 186 186
Cash and cash equivalents at the end of the
reporting period 2.1A 199 171 186
The above statement should be read in conjunction with the accompanying notes.
This statement also represents the results for Outcome 1 as the Archives only has one outcome. Outcome 1 is described at the Overview note.
Budget Variances Commentary Cash Flow Statement Appropriations The variance for appropriations received is due to the actuals including amounts relating to revenue from Section 74 of the PGPA Act which was not included in the budgeted amount. Suppliers Suppliers is greater then budget due to additional expenditure in suppliers due to underspends in employees and also due to the decrease in supplier payables during 2015-16.
The new AASB 16 Leases (effective 1 January 2019) requires that most leases be recognised as lease liabilities and right-of -use assets on the Statement of
Financial Position. The new standard will have a material impact on the recognition of the Department's operating leases for the office accommodation. The
actual impact has not been quantified and will depend on the actual lease agreements in place as at 1 July 2019.
Taxation
The Archives 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:
a) where the amount of GST incurred is not recoverable from the Australian Taxation Office; and
b) for receivables and payables.
Events After the Reporting Period
There was no subsequent event that had the potential to significantly affect the ongoing structure or financial activities of the Archives.
No new or revised pronouncements were issued by the Australian Accounting Standards Board prior to the finalisation of the financial statements which are
expected to have a material financial impact on the Archives in future reporting periods.
As a not-for-profit public sector entity, the Archives is currently exempt from the requirements of AASB 124 Related Party Disclosures. For reporting periods
commencing on or after 1 July 2016, AASB 124 will be extended to apply to all not-for-profit public sector entities and the Archives will be required to disclose any
related party transactions in accordance with the revised standard. Disclosure of comparative information is not required in the first year of application.
Unless an alternative treatment is specifically required by an accounting standard or the FRR, assets and liabilities are recognised in the statement of financial
position, when and only when, it is probable that future economic benefits will flow to the entity or a future sacrifice of economic benefits will be required and the
amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under executory contracts are not recognised unless required
by an accounting standard.
Unless alternative treatment is specifically required by an accounting standard, income and expenses are recognised in the Statement of Comprehensive
Income, when and only when, the flow, consumption or loss of economic benefits has occurred and can be reliably measured.
The financial statements have been prepared in accordance with:
Future Australian Accounting Standard Requirements
The financial statements are presented in Australian dollars and values are rounded to the nearest thousand dollars unless otherwise specified.
a) Financial Reporting Rule (FRR) for reporting periods ending on or after 1 July 2015; and
New Accounting Standards
Adoption of New Australian Accounting Standard Requirements
No accounting standard has been adopted earlier than the application date as stated in the standard.
Overview
Objectives of the National Archives of Australia
The Archives is structured to the meet the single outcome:
The financial statements are general purpose financial statements and are required by section 42 of the Public Governance, Performance, and Accountability Act
2013.
b) Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.
The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at
fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.
The Basis of Preparation
The National Archives of Australia (the Archives) is an Australian Government controlled entity. It is a not-for-profit entity. The objective of the Archives is to
maintain the records created by Australian Government agencies that form the archival resources of the Commonwealth.
Outcome 1: To promote the creation, management and preservation of authentic, reliable and useable Commonwealth records and to facilitate Australians'
access to the archival resources of the Commonwealth.
The Archives Statement of Comprehensive Income and Statement of Financial Position represents the outcome statement as all Income, Expenditure, Assets
and Liabilities relate to Outcome 1 above.
The continued existence of the Archives in its present form and with its present program is dependent on Government policy and on continuing funding by
Parliament for the Archives' administration and program.
Overview
1.1: Expenses
2016 2015
$'000 $'000
1.1A: Employee Benefits
Wages and salaries 25 486 25 471
Superannuation
Defined contribution plans 1 909 1 851
Defined benefit plans 3 992 3 571
Leave and other entitlements 5 573 5 157
Other 114 107
Total employee benefits 37 074 36 157
1.1B: Suppliers
Goods and services supplied or rendered
Office equipment and supplies 1 416 1 612
Communications 655 516
Professional services 4 005 3 618
Travel 837 741
Exhibitions and advertising 285 601
Employee related expenses 940 1 010
Utilities 1 106 1 216
Other property operating expenses 4 256 4 265
Other 374 381
Total goods and services supplied or rendered 13 874 13 960
Goods supplied 915 992
Services rendered 12 959 12 968
Total goods and services supplied or rendered 13 874 13 960
Other suppliers
Operating lease rentals in connection with
Minimum lease payments 7 750 7 646
Contingent rentals 2 723 1 677
Workers compensation expenses 607 594
Total other suppliers 11 080 9 917
Total suppliers 24 954 23 877
Leasing commitments payable
Commitments for lease payments in relation to non-cancellable
Operating leases are payable as follows:
Within 1 year 10 833 9 039
Between 1 to 5 years 11 435 19 397
More than 5 years 20 81
Total operating lease commitments 22 288 28 517
The Archives in its capacity as lessee has agreements for office accommodation, which are effectively non-
cancellable. Contingent rental payments are determined by market reviews and changes in the Consumer
Price Index (CPI). Several of these agreements include options to extend the existing lease term.
Financial Performance This section analyses the financial performance of the Archives for the year ended 30 June 2016.
1.1: Expenses
2016 2015
$'000 $'000
1.1C: Grants
Public sector
Australian Government entities (related parties) 20 20
Private sector
Non-profit organisations - 5
Universities - 37
Individuals - -
Total grants 20 62
1.1D: Write-Down and Impairment of Assets
Impairment of property, plant and equipment 221 1
Impairment of intangible assets 22 -
Bad and Doubtful Debts 20 -
Total write-down and impairment of assets 263 1
Significant Accounting Policy Operating lease payments for leases with fixed increases are expensed on a straight-line basis which is representative of the pattern of benefits derived from the leased assets.
1.2: Own-Source Revenue and gains
2016 2015
$'000 $'000
Own-Source Revenue
1.2A: Sale of Goods and Rendering of Services
Sale of goods 798 1 384
Rendering of services 1 812 2 032
Total sale of goods and rendering of services 2 610 3 416
1.2B: Rental Income
Operating lease
Rental income from sub-leases 132 136
Total other revenue 132 136
Subleasing rental income commitments receivable
Commitments for sublease rental income receivables are as follows:
Within 1 year 199 53
Between 1 to 5 years 224 -
More than 5 years - -
Total sublease rental income commitments 423 53
1.2C: Other Revenue
Resources received free of charge
Acquisition of heritage and cultural assets at no cost 8 844 10 078
Acquisition of infrastructure, plant and equipment assets at no cost - 1 760
Remuneration of auditors 75 77
Other 37 69
Total other revenue 8 956 11 984
The Archives in its capacity as lessor has sublease agreements for rental properties for fixed terms and amounts.
Significant Accounting Policy Revenue from the sale of goods is recognised when: a) the risks and rewards of ownership have been transferred to the buyer; b) the entity retains no managerial involvement or effective control over the goods; 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.
Significant Accounting Policy Resources Received Free of Charge Resources received free of charge are recognised as revenue 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. Resources received free of charge are recorded as either revenue or gains depending on their nature. Contributions of assets at no cost of acquisition or for nominal consideration are recognised as revenue 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.
1.2: Own-Source Revenue and gains
2016 2015
$'000 $'000
1.2D: Revenue from Government
Departmental appropriations 58 297 59 009
Total revenue from Government 58 297 59 009
Significant Accounting Policy Revenue from Government Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the entity 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.
2.1 Financial Assets
2016 2015
$'000 $'000
2.1A: Cash and Cash Equivalents
Cash on hand or on deposit 199 171
Total cash and cash equivalents 199 171
2.1B: Trade and Other Receivables
Appropriations receivable 18 003 21 051
Trade receivables 497 309
GST receivable from the Australian Taxation Office 465 395
Accrued income 20 -
Other 275 99
Total trade and other receivables (gross) 19 260 21 854
Financial instruments held are cash, trade receivables and other receivables only.
Of the total financial assets reported on the statement of financial position of $19,459,000
(2015:$22,025,000), financial assets classified as financial instruments comprise a total of $971,000
(2015:$580,000).
Financial Position This section analyses the Archives' assets used to conduct its operations and the operating liabilities incurred as a result. Employee related information is disclosed in the People and Relationships section.
Accounting Policy Cash is recognised at its nominal amount. Cash and cash equivalents includes: a) cash on hand; b) demand 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.
Accounting Policy The Archives' financial assets are cash, receivables and accrued income only, and are classified as 'loans and receivables'. Receivables are recognised upon trade date. Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any impairment allowance account. Collectability of debts is reviewed at end of the reporting period. Allowances are made when collectability of the debt is no longer probable. Effective Interest Rate 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, where appropriate, a shorter period. Loans and Receivables Trade receivables, loans and other receivables that have fixed or determinable payments and that are not quoted in an active market are classified as 'loans and receivables'. Loans and receivables are measured at fair value and subsequently at amortised cost using the effective interest method less impairment. Impairment of Financial Assets Financial assets are assessed for impairment at the end of each reporting period. Allowances are made when collectability of the debt is no longer possible. If there is objective evidence that impairment loss has been incurred, 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 Statement of Comprehensive Income.
2.2 Non- Financial Assets
2.2A: Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment and Intangibles
Reconciliation of the opening and closing balances of property, plant and equipment and intangibles for 2016Heritage and
cultural (1)
Property, plant
and equipment
Computer
Software (2)
Other
Intangibles Total
$'000 $'000 $'000 $'000 $'000
As at 1 July 2015
Gross book value 1 459 606 29 189 20 618 13 315 1 522 728
Accumulated depreciation and impairment (2 755) (8 098) (13 138) (4 583) (28 574)
Total as at 1 July 2015 1 456 851 21 091 7 480 8 732 1 494 154 Additions:
Purchase - 2 890 1 259 823 4 972
Donation/gift 8 844 - - - 8 844
Revaluations and impairments recognised in other comprehensive income (509) 4 052 - - 3 543
Depreciation and amortisation (6 062) (5 074) (1 398) - (12,534)
Disposals (89) (131) (21) - (241)
Total as at 30 June 2016 1 459 035 22 828 7 320 9 555 1 498 738
Total as at 30 June 2016 represented by
Gross book value 1 468 361 23 567 21 747 14 139 1 527 814
Accumulated depreciation and impairment (9 326) (739) (14 427) (4 584) ( 29 076)
Total as at 30 June 2016 1 459 035 22 828 7 320 9 555 1 498 738
No intangibles assets are expected to be sold or disposed of within the next 12 months.
Revaluations of non-financial assets
On 31 May 2016, an independent valuer (Australian Valuation Solutions) conducted a valuation of the property, plant and equipment asset class.
All revaluations were conducted in accordance with the revaluation policy stated at below.
1. Other property, plant and equipment that met the definition of a heritage and cultural item were disclosed in the heritage and cultural asset class.
A revaluation increment of $4,052,000 for property, plant and equipment (2015: nil), was credited to the asset revaluation surplus by asset class and included in the equity section of
the Statement of Financial Position. No decrements or increments were expensed (2015: nil)
No revalution has been undertaken for heritage and cultural asset, therefore the increment for heritage and cultural asset was nil in 2016 (2015: increment for 23,247,000).
2. The carrying amount of computer software included $1,986,000 purchased software and $5,334,000 internally generated software.
No indicators of impairment were found for property, plant and equipment and intangibles. An annual assessment was undertaken internally to determine whether there is any
indicators of impairment for Heritage and Cultural assets. An externally independent valuer has provided written assurance to the Archives that the carrying amount of Heritage and
Cultural assets is not materially different from the fair value.
2.2 Non- Financial Assets
Contractual commitments for the acquisition of property, plant, equipment and intangible assets
As at 30 June 2016, the Archives has contractual commitments for acquisition of software assets of $296,000, and acquisition of property, plant, equipment assets of $135,000.
Note 2.2A (Cont'd): Reconciliation of the Opening and Closing Balances of Property, Plant and Equipment and Intangibles
Reconciliation of the opening and closing balances of property, plant and equipment for 2015Heritage and
cultural (1)
Property, plant
and equipment
Computer
Software Other Intangibles Total
$'000 $'000 $'000 $'000 $'000
As at 1 July 2014
Gross book value 1 450 228 21 806 19 833 12 405 1 504 272
Accumulated depreciation and impairment (16 463) (4 442) (11,933) (4 584) ( 37 422)
Total as at 1 July 2014 1 433 765 17 364 7 900 7 821 1 466 850
Additions:
Purchase - 5 745 882 911 7 538
Donation/gift 10 077 1 760 - - 11 837
Revaluations and impairments recognised in other comprehensive income 19 719 - - - 19 719
Revaluations recognised in net cost of services - - - - -
Depreciation and amortisation (6 038) (3 756) (1 303) - (11 097)
Disposals (672) (22) - ( 694)
Total as at 30 June 2015 1 456 851 21 091 7 480 8 732 1 494 154
Totals as at 30 June 2015 represented by
Gross book value 1 459 606 29 189 20 618 13 315 1 522 728
Accumulated depreciation and impairment (2 755) (8 098) (13,138) (4 583) ( 28 574)
Totals as at 30 June 2015 1 456 851 21 091 7 480 8 732 1 494 154
1. Other property, plant and equipment that met the definition of a heritage and cultural item were disclosed in the heritage and cultural asset class.
2.2 Non- Financial Assets
Assets class Useful life
Other property, plant and
equipment 2 - 26 years
Heritage and cultural 29 - 349 years
Intangibles (exclude digital collection) 2 - 20 years
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 in the
surplus/deficit. Revaluation decrements for a class of assets are recognised directly in the surplus/deficit except to the extent that they reverse
a previous increment for that class.
Accounting Policy
Asset Recognition Threshold
Purchases of property, plant and equipment are recognised initially at cost in the statement of financial position, except for purchases of IT
equipment costing less than $1,000 (ex. GST) or for all other plant and equipment costing less than $2,000 (ex. GST), 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 Archives where there exists an obligation to restore
the premises to its original condition. These costs are included in the value of the Archives' leasehold improvements with a corresponding
provision for the 'make good' recognised. (Refer to the provision for restoration obligations in note 2.4 A).
Revaluations
Following initial recognition at cost, property, plant and equipment are carried at fair value. Valuations are conducted with sufficient frequency
to ensure that the carrying amounts of assets do not differ materially from the assets' fair values as at the reporting date. The regularity of
independent valuations depends upon the volatility of movements in market values for the relevant assets.
The national archival collection includes records in a wide variety of media including files and card records, account books and ledgers,
architectural models, photographs, films and video tapes, optical disks and computer tapes. High value records are stored in specially
designed temperature and humidity controlled environments (where required).
Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset is restated
to the revalued amount.
Depreciation and Amortisation
Depreciable property, plant and equipment assets and intangibles (excluding the digital collection in other intangibles assets) are written-off to
their estimated residual values over their estimated useful lives to the Archives using, in all cases, the straight-line method of depreciation.
Depreciation and amortisation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary
adjustments are recognised in the current, or current and future reporting periods, as appropriate.
Depreciation and amortisation rates applying to each class of depreciable asset are based on the following useful lives:
Impairment
All assets were assessed for impairment at 30 June 2016. Where indications of impairment exist, the asset’s recoverable amount is estimated
and an impairment loss recognised 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 Archives were deprived of the asset, its value in use is
taken to be its depreciated replacement cost.
Derecognition
An item of property, plant and equipment and intangibles are derecognised upon disposal or when no further future economic benefits are
expected from its use or disposal.
Heritage and Cultural Assets
All intangible assets were assessed for indications of impairment as at 30 June 2016.
Curatorial and preservation policies for heritage and cultural assets can be accessed at:
http://www.naa.gov.au/about-us/organisation/op-policies.aspx
Intangibles
The Archives' intangibles comprise internally developed software for internal use, purchases of licensed software and a digitised collection that
is both internally and externally digitised.
Intangible assets are carried at cost less accumulated amortisation and accumulated impairment losses.
Effective 1 July 2012 the intangible digital collections are not amortised as their useful lives have been determined as indefinite. The useful
lives of these collections are reviewed annually to determine whether events and circumstances continue to support an indefinite useful life
assessment for that collection.
2.3: Payables
2016 2015
$'000 $'000
2.3A: Suppliers
Trade creditors and accruals 724 2 549
Operating lease rentals 480 616
Total suppliers 1 204 3 165
Suppliers expected to be settled
No more than 12 months 1 027 2 860
More than 12 months 177 305
Total suppliers 1 204 3 165
2.3B: Other Payables
Wages and salaries 144 1 067
Superannuation 22 193
Prepayments received/unearned income 1 111 201
Total other payables 1 277 1 461
Other payables to be settled
No more than 12 months 540 1 461
More than 12 months 737 -
Total other payables 1 277 1 461
2.4: Other Provisions
2016 2015
$'000 $'000
2.4A: Other Provisions
Provision for restoration 9 583 1 867
Total other provisions 9 583 1 867
Other provisions expected to be settled in:
No more than 12 months 2 342 4
More than 12 months 7 241 1 863
Total other provisions 9 583 1 867
Provision for
restoration
$'000
As at 1 July 2015 1 867
Amounts increased as a result of revaluation 7 679
Unwinding of discount or change in discount rate 37
Total as at 30 June 2016 9 583
The Archives currently has 11 (2015:11) agreements for the leasing of premises which have provisions
requiring the Archives to restore the premises to their original condition at the conclusion of the lease. The
Archives has made a provision to reflect the present value of this obligation.
Accounting Judgements and Estimates The Archives has made a significant estimate of the cost to make good or remediate its storage and accommodation premises to bring them back to the condition and orientation they were prior to occupancy by the Archives. The make good provision is informed by independent valuation and was last revalued on 30 June 2016 by a qualified independent valuer (Australian Valuation Solutions).
3.1: Appropriations
3.1A: Annual Appropriations ('Recoverable GST exclusive')
Annual Appropriations for 2016
Annual
Appropriation1
Advance to the
Finance
Minister
Section 74
Receipts Section 75
Total
Appropriation Variance2
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Departmental
Ordinary annual services 58 297 - 3 967 - 62 264 65 503 ( 3 239)
Capital Budget3 5 066 5 066 4 841 225
Other services - - - - - - -
Equity - - - - - - -
Total departmental 63 363 - 3 967 - 67 330 70 344 ( 3 014)
Annual Appropriations for 2015
Annual
Appropriation1
Advance to the
Finance Minister
Section 74
Receipts Section 75
Total
Appropriation Variance2
$'000 $'000 $'000 $'000 $'000 $'000 $'000
Departmental
Ordinary annual services 59 009 - 3 445 - 62 454 58 955 3 499
Capital Budget3 5 911 5 911 9 298 ( 3 387)
Other services - - - - - - -
Equity - - - - - - -
Total departmental 64 920 - 3 445 - 68 365 68 253 112
3. Departmental Capital Budgets are appropriated through Appropriation Acts (No.1). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.
2. Variance in 2014-15 year is primarily due to higher than budgeted expenditure on the AudioVisual Asset Management System and also construction work on the Chester Hill preservation facility.
Appropriation Act Appropriation
Applied in
2016 (current
and prior
years)
PGPA Act
1. In 2015-16, $1,681,000 of appropriations ($879,000 of Appropriation Act 1 and $802,000 of DCB) have been withheld under Section 51 of the PGPA Act.
Appropriation Act PGPA Act Appropriation
Applied in 2015
(current and
prior years)
1. In 2014-15, there was no appropriation withheld under Section 51 of the PGPG Act.
2. Variance in 2015-16 is mainly due to the reduction in supplier payables during the year resulting in the Appropriation being applied in 2015-16 that related to expenditure recognised in 2014-15.
3. Departmental Capital Budgets are appropriated through Appropriation Acts (No.1). They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.
Funding This section identifies the Archives' funding structure.
3.1: Appropriations
3.1B: Unspent Annual Appropriations ('Recoverable GST exclusive')
2016 2015
Authority $'000 $'000
Departmental
Appropriation Bill (No. 1) 2014-2015 - 21 617
Appropriation Bill (No. 1) 2015-2016 15 506 -
Appropriation Bill (No. 1) 2015-2016 - DCB 2 487 -
Total 17 993 21 617
2016 2015
$'000 $'000
Total comprehensive income/(loss) less depreciation/ amortisation expenses previously
funded through revenue appropriations1
(21 539) 11 199
Plus: depreciation/amortisation expenses previously funded through revenue appropriation 12 534 11 097
Total comprehensive income/(loss) - as per the Statement of Comprehensive Income (9 005) 22 296
3.2: Net Cash Appropriation Arrangements
1. Entities receive a separate capital budget provided through equity appropriations. Capital budgets are to be appropriated in the period when cash payment for capital
expenditure is required.
3.3: Cash Flow Reconciliation
2016 2015
$'000 $'000
Reconciliation of cash and cash equivalents as per
statement of financial position to cash flow statement
Cash and cash equivalents as per
Cash flow statement 199 171
Statement of financial position 199 171
Discrepancy - -
Reconciliation of net cost of services to
net cash used by operating activities
Net cost of services (63 167) (56 432)
Revenue from Government 58 297 59 009
Adjustments for non-cash items
Depreciation / amortisation 12 534 11 097
Net write down of non-financial assets 243 -
Net loss on disposal of assets - 676
Net gain on sale of assets ( 51) -
Revaluation of make good provision (7 679) -
Resources received free of charge - goods (8 844) (11 837)
Movements in assets and liabilities
Assets
Decrease / (Increase) in net receivables 2 594 64
Decrease / (Increase) in inventories 56 33
Decrease / (Increase) in prepayments received (135) (235)
Liabilities
Increase / (Decrease) in employee provisions 464 172
Increase / (Decrease) in supplier payables (2 092) ( 530)
Increase / (Decrease) in other payables (184) (449)
Increase / (Decrease) in other provisions 7 716 27
Net cash used by operating activities ( 248) 1 595
4.1: Employee Provisions
2016 2015
$'000 $'000
Note 4.1: Employee Provisions
Annual leave 3 483 3 639
Long service leave 8 706 8 086
Total employee provisions 12 189 11 725
Employee provisions expected to be settled in:
No more than 12 months 3 287 3 355
More than 12 months 8 902 8 370
Total employee provisions 12 189 11 725
People and relationships This section describes a range of employment and post employment benefits provided to our people and our relationships with other key people.
Accounting policy Liabilities for annual leave and long service leave expected to be settled within twelve months are measured at their nominal amounts. Leave liabilities expected to be settled after twelve months are measured at the present value of the estimated future cash outflow. Leave The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the Archive'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 has been determined using present value techniques in accordance with the shorthand method as per FRR 24.1(a) as at 30 June 2016. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation. Superannuation The Archives' staff are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), or the PSS accumulation plan (PSSap), or other complying superannuation funds held outside the Australian Government. 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. This liability is reported in the Department of Finance’s administered schedules and notes. The Archives makes employer contributions to the employees' defined benefit superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government. The Archives accounts for the contributions as if they were contributions to defined contribution plans. The liability for superannuation recognised as at 30 June 2016 represents outstanding contributions.
Note 4.2: Senior Management Personnel Remuneration
2016 2015
$'000 $'000
Short-term employee benefits
Salary 1 118 1 125
Total short-term employee benefits 1 118 1 125
Post-employment benefits
Superannuation 226 234
Total post-employment benefits 226 234
Other long-term employee benefits
Annual leave 139 110
Long-service leave 52 57
Total other long-term employee benefits 191 167
Total senior executive remuneration expenses 1 535 1 526
The total number of senior management personnel that are included in the above table are 6 (2015:7).
5.1: Financial Instruments
Note 5.1A: Credit Risk
The Archives holds no collateral to mitigate against credit risk.
Note 5.1B: Market Risk
Note 5.1C: Liquidity Risk
The Archives' financial liability is trade payables. The exposure to liquidity risk is based on the notion that the entity
will encounter difficulty in meeting its obligations associated with financial liabilities. This is unlikely due to the
receiving appropriation funding from the Australian Government and the entity manages its budgeted funds to ensure
it has adequate funds to meet payments as they fall due. In addition, the Archives has policies in place to ensure
timely payments were made when due and has no past experience of default.
The Archives was exposed to minimal credit risk as loans and receivables were cash, trade receivables, accrued
revenue and other receivables. The maximum exposure to credit risk was the risk that arises from potential default
of debtor. This amount is equal to the total amount of trade receivables, accrued revenue, and other receivables
(2016: $792,000 and 2015: $409,000).
The Archives has assessed the risk of the default on payment and allocated $20,502 in 2016 (2015: $396) to an
impairment allowance account. Policies and procedures are in place that guide employees in debt recovery.
A total of $57,000 (2015: $281,000) of receivables are overdue. All receivables are expected to be recovered within
12 months.
The Archives has sufficient available assets to meet all financial liabilities at 30 June 2016.
Liquidity risk is the risk that the Archives will not be able to meet its obligations as they fall due.
The market risk refers to currency risk and interest rate risk. Currency risk refers to the risk that the fair value or
future cash flows of a finanical instrument will fluctate because of changes in foreign exchange rates. The Archives is
not exposed to the currency risk. Interest rate risk refers to the risk that the fair value or future cash flows of a
financial instrument will fluctuate because of changes in market interest rates. The Archives' exposure to interest rate
risk is considered low.
Managing uncertainties Managing uncertainties This section analyses how the Archives manages financial risks within its operating environment.
5.2: Fair Value Measurement
The following tables provide an analysis of assets and liabilities that are measured at fair value.
The different levels of the fair value hierarchy are defined below:
Accounting Policy
5.2A: Fair Value Measurements, Valuation Techniques and Inputs Used
For levels 2 and 3 fair value measurements
2016 2015 Category Valuation
$'000 $'000 (Level 1,2 or3) Technique Inputs used
Non-financial assets
Heritage and cultural 1 459 035 1 456 851 Level 2 Market comparables Market buying / selling prices,
Professional appraisal of similar items
Other property, plant and equipment 3 521 Level 2 Market Approach
Prices and other relevant information
generated by market transactions
involving plant and equipment assets
were considered.
Other property, plant and equipment 19 307 21 091 Level 3 Depreciated replacement cost Replacement cost of similar assets
Remaining useful lives of assets
Total non-financial assets 1 481 863 1 477 942
Total fair value measurements of assets in the statement of
financial position 1 481 863 1 477 942
There were no transfers between level 1 and 2 for recurring fair value measurements during the reporting period.
The Archives deems transfer between levels of the fair value hierarchy to have occurred at the end of the reporting period.
Note 5.2B: Reconciliation for Recurring Level 3 Fair Value Measurements
Recurring Level 3 fair value measurements - reconciliation for assets
Non-financial assets
2016 2015 2016 2015
$'000 $'000 $'000 $'000
As at 1 July 21 091 17 364 21 091 17 364
Purchases 2 890 7 505 2 890 7 505
Depreciation (5 074) (3 756) ( 5 074) (3 756)
Disposals ( 131) ( 22) ( 131) ( 22)
Total gains/(losses) recognised in other comprehensive income1
4 052 4 052
Transfers into Level 3 - -
Transfers out of Level 3 (3 521) ( 3 521) -
Total as at 30 June 19 307 21 091 19 307 21 091
1. This gain is presented in the Statement of Comprehensive Income under 'Revaluation (decrement) / Increment'.
Total
There were some transfer of other property, plant and equipment assets from fair value level 3 to level 2 due to the market approach used in the revaluation for those assets during the year.
Other property, plant and equipment
Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Archives can access at measurement date.
Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.
Level 3: Unobservable inputs for the asset or liability.
Fair value measurements at the end of the
reporting period
The Archives engaged the service of the Australian Valuation Solutions (AVS) to conduct a comprehensive revaluation of all other property, plant and equipment assets at 31 May 2016. AVS has provided written assurance to the Archives that the models developed to determine fair value measurement are in compliance with
AASB13. The heritage and cultural assets were revalued in 2014-15 by a qualified independent valuer (Peter Tinslay) in accordance with AASB116. An annual assessment is undertaken to determine that the methods utilised to determine the fair value is still valid and the carrying amount of the heritage and cultural assets is not
materially different from the fair value.
The methods utilised to determine and substantiate the unobservable inputs are derived and evaluated as follows: