2009-10 PRIMA Illustrative - FMA - finance.gov.au · publication expressly disclaim all or any...

ANNEXURE A

Illustrative Financial Statements 2009-10

Financial Management and

Information regarding the Department of Finance and Deregulation is available on the Internet at the followingaddress: www.finance.gov.au.

The Department of Finance and Deregulation and all persons involved in the preparation and distribution of thispublication expressly disclaim all or any contractual, tortious or other form of liability to any person ororganisation in respect of the publication and any consequences arising from its use by any person in relianceupon the whole or any part of the contents of this publication. Whilst every care has been taken in its preparationno person should act specifically on the basis of the material contained herein without considering and takingprofessional advice.

Accountability (FMA) ActFinancial Management and

Agencies

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Finance Minister's Orders - Incorporating Policy and Guidance - Annexure A

Table of Contents

PRIMA General Information 3Independent Audit Report 4Statement by CEO and CFO 6Statement of Comprehensive Income 7Balance Sheet 9Statement of Changes in Equity 11Cash Flow Statement 13Schedule of Commitments 15Schedule of Contingencies 18Schedule of Asset Additions 19Schedule of Administered Items 20Note 1: Summary of Significant Accounting Policies 25Note 2: Events After the Reporting Period 37Note 3: Expenses 38Note 4: Income 41Note 5: Income Tax Expense (Competitive Neutrality) 44Note 6: Financial Assets 45Note 7: Non-Financial Assets 47Note 8: Payables 54Note 9: Interest Bearing Liabilities 55Note 10: Provisions 57Note 11: Restructuring 60Note 12: Cash Flow Reconciliation 63Note 13: Contingent Liabilities and Assets 65Note 14: Senior Executive Remuneration 67Note 15: Remuneration of Auditors 69Note 16: Financial Instruments 70Note 17: Income Administered on Behalf of Government 76Note 18: Expenses Administered on Behalf of Government 77Note 19: Assets Administered on Behalf of Government 79Note 20: Liabilities Administered on Behalf of Government 81Note 21: Administered Reconciliation Table 82Note 22: Administered Contingent Assets and Liabilities 83Note 23: Administered Investments 85Note 24: Administered Financial Instruments 86Note 25: Appropriations 90Note 26: Special Accounts 98Note 27: Compensation and Debt Relief 100Note 28: Assets Held in Trust 103Note 29: Reporting of Outcomes 104

Forms of Financial Statements (FMA) Page 2

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Reference GENERAL INFORMATION ON PREPARATION OF FINANCIAL STATEMENTS

AASB 108.19(b)

Errors

AASB 108.42

AASB 108.36

AASB 108.39

AASB 108.40

AASB 101.38

AASB 101.41

AASB 101.42

AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors specifies that changes in accounting policies undertaken voluntarily or as a result of new accounting standards that do not contain transitional provisions are to be applied retrospectively where practicable.

Subject to paragraph 37 of AASB 108, the effect of a revision of an accounting estimate must be recognised as a revenue or an expense:

• in the reporting period in which the accounting estimate is revised, if the revision affects that reporting period only; or

When the presentation or classification of items is amended, comparatives must be re-presented or reclassified unless it is impracticable and the nature and amount of, and reason for, the re-presentation or reclassification must be disclosed.

If it is impracticable to re-present or reclassify comparative amounts, the reason must be disclosed as well as the nature of the changes that would have been made if amounts were re-presented or reclassified.

Accounting estimates must only be changed to give effect prospectively.

The nature and amount of a revision of an accounting estimate which affects the reported financial performance or financial position of the current reporting period, or is expected to have an effect on the financial performance or financial position of future reporting periods, must be disclosed in the notes to the financial report. Where it is impracticable to estimate the effect on future periods, this disclosure may be omitted.

• in the reporting period of the revision and future reporting periods, if the revision affects both the current and future reporting periods.

Comparatives

Comparatives must be disclosed for the reporting period unless specified elsewhere in these Finance Minister's Orders or an applicable Australian Accounting Standard. This includes narrative information when it is relevant to the understanding of the financial statements.

If the amount of the effect in future periods is not disclosed because estimating it is impracticable, an entity shall disclose that fact.

AASB 108 requires that restatements to correct errors are made retrospectively, to the extent practicable.

The process for making accounting estimates involves best estimates based on the latest information available. As a result of the uncertainties inherent in business and other activities, many items cannot be measured precisely but can only be estimated.

Revision of Accounting Estimates

Accounting Estimates

GUIDANCE

Changes in Accounting Policies

Consolidated Accounts

The financial report of an Agency must encompass all entities controlled by the agency and must be accounted for in accordance with the consolidation standard AASB 127 Consolidated and Separate Financial Statements. Subsidiaries of agencies must be consolidated to present the financial performance and position of the consolidated entity.

Some departments have designated business operations which may prepare financial statements in their own right. These business operations are part of the department itself and are not subsidiaries in the sense of AASB 127. There is no parent entity separate from the business operation to be reported, and the elimination of balances and transactions between the rest of the agency and its business operations is no different to the elimination of any other internal transactions and balances.

Administered investments in controlled entities are not consolidated on a line-by-line basis because their consolidation is relevant only at the Whole-of-Government level.

Preparation of Note 1: Summary of Significant Accounting Policies

Australian Government entities may omit any information from Note 1 that is not relevant to their operations. Additional information may also be added as required.


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Reference INDEPENDENT AUDIT REPORT

To the Minister for PRIMA

Scope

I have audited the accompanying financial statements of PRIMA Agency for the year ended 30 June 2010, which comprise: a Statement by the Chief Executive and Chief Financial Officer; Statement of Comprehensive Income; Balance Sheet; Statement of Changes in Equity; Cash Flow Statement; Schedule of Commitments; Schedule of Contingencies; Schedule of Asset Additions; Schedule of Administered Items and Notes to and forming part of the Financial Statements, including a Summary of Significant Accounting Policies.

The Responsibility of the Chief Executive for the Financial Statements

PRIMA Agency’s Chief Executive is responsible for the preparation and fair presentation of the financial statements in accordance with the Finance Minister’s Orders made under the Financial Management and Accountability Act 1997, including the Australian Accounting Standards (which include the Australian Accounting Interpretations). This responsibility includes establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial statements that are free from material misstatement, whether due to fraud or error; selecting and applying appropriate accounting policies; and making accounting estimates that are reasonable in the circumstances.

Auditor’s Responsibility

My responsibility is to express an opinion on the financial statements based on my audit. My audit has been conducted in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Auditing Standards. These Auditing Standards require that I comply with relevant ethical requirements relating to audit engagements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by the Chief Executive as well as evaluating the overall presentation of the financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.


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Reference Independence

In conducting the audit, I have followed the independence requirements of the Australian National Audit Office, which incorporate the requirements of the Australian accounting profession.

Auditor’s Opinion

In my opinion, the financial statements of the PRIMA Agency:

(a) have been prepared in accordance with the Finance Minister’s Orders made under the Financial Management and Accountability Act 1997, including the Australian Accounting Standards; and

(b) give a true and fair view of the matters required by the Finance Minister’s Orders including PRIMA Agency’s financial position as at 30 June 2010 and its financial performance and cash flows for the year then ended.

[Signature]

Name: John Gorton

Title: Princial Adviser, Delegate of the Auditor-General

Location: Canberra

Date: 17 August 2010

GUIDANCE

General

The draft audit opinion has been supplied for the purposes of illustration only. The actual presentation of the 2009-10 financial statement audit opinion is subject to change and is the responsibility of the ANAO signing officer.


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Reference STATEMENT BY THE CHIEF EXECUTIVE AND CHIEF FINANCIAL OFFICER

In our opinion, the attached financial statements for the year ended 30 June 2010 are based on properlymaintained 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…………… Signed…………………

14 August 2010 14 August 2010

Peter Wells John TaylorChief Executive Chief Financial Officer


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Reference STATEMENT OF COMPREHENSIVE INCOMEfor the period ended 30 June 2010

2010 2009AASB 101.10(b) Notes $'000 $'000

EXPENSESEmployee benefits 3A 113,343 84,579 Supplier expenses 3B 187,041 152,010 Depreciation and amortisation 3C 10,245 13,845

AASB 101.82(b) Finance costs 3D 750 239 Write-down and impairment of assets 3E - 232 Other 3F 1,236 71 Total expenses 312,615 250,976

LESS: OWN-SOURCE INCOMEOwn-source revenueSale of goods and rendering of services 4A 188,114 166,156 Interest 4B - 42

AASB 101.82(a) Total own-source revenue 188,114 166,198

AASB 101.34(a) GainsSale of assets 4C 371 755

AASB 101.98(a) Reversals of previous asset write-downs and impairment 4D - 3,312 Other 4E 450 429 Total gains 821 4,496 Total own-source income 188,935 170,694 Net cost of services 123,680 80,282

Revenue from Government 4F 151,482 106,745 Surplus before income tax on continuing operations 27,802 26,463

AASB 101.82(d) Income tax expense 5 5,684 17,410 Surplus after income tax on continuing operations 22,118 9,053

AASB 101.82(f) Surplus after income tax 22,118 9,053 AASB 101.83(a)(ii) Surplus attributable to the Australian Government 22,118 9,053


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Reference OTHER COMPREHENSIVE INCOMEChanges in asset revaluation reserves 1,867 3,997 Total other comprehensive income after income tax 1,867 3,997 Total comprehensive income 23,985 13,050 Total comprehensive income attributable to the Australian Government 23,985 13,050

AASB 101.99

GUIDANCE

AASB 101.88

AASB 101.85

AASB 101.87

AASB 101.97-98

AASB 101.83(b)

Income AASB 101.34(a)

Int 1031.6-7

Accounting for the GST

In Interpretation 1031 Accounting for the Goods and Services Tax (GST), revenues and expenses must be recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the taxation authority. In this instance, the GST must be recognised as part of the expense.

Proceeds from disposal of assets and the carrying amount of assets sold are netted off as a gain/loss on disposal. A gain is presented as a separate class of income from revenue.

An entity shall not present any items of income and expense as extraordinary items, either on the face of the statement of comprehensive income or in the notes.

When items of income and expense are material, their nature and amount shall be disclosed separately. AASB 101 paragraph 98 lists circumstances that would give rise to the separate disclosure of items.

The surplus or deficit attributable to non-controlling interest and to equity holders of the parent, is separately disclosed on the face of the statement of comprehensive income.

Additional line items, headings and sub-totals must be disclosed on the face of the statement of comprehensive income when it is necessary to understanding the entity’s financial performance.

An entity shall present an analysis of expenses using a classification based on either the nature of expenses or their function within the entity, whichever provides information that is reliable and more relevant. AASB 101 Presentation of Financial Statements paragraph 99 encourages entities to present this analysis of income and expenses on the face of the statement of comprehensive income. This approach is to be adopted by all Australian Government entities.

POLICY

Statement of Comprehensive Income Items

All items of income and expense recognised in a period shall be included in profit or loss unless an Australian Accounting Standard requires otherwise.


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Reference

2010 2009Notes $’000 $’000

ASSETSFinancial Assets

AASB 101.54(i) Cash and cash equivalents 6A 7,089 6,131 AASB 101.54(h) Trade and other receivables 6B 29,959 31,577

Total financial assets 37,048 37,708

Non-Financial AssetsAASB 101.54(a) Land and buildings 7A 174,293 177,922 AASB 101.54(a) Property, plant and equipment 7B,C 49,620 36,585 AASB 101.54(c) Intangibles 7D,E 5,267 1,621 AASB 101.54(g) Inventories 7F 5,902 1,903

Other 7G 3,650 1,764 Total non-financial assets 238,732 219,795 Total Assets 275,780 257,503

LIABILITIESAASB 101.54(k) Payables

Suppliers 8A 21,087 29,047 AASB 101.54(k) Other 8B 12,928 12,140

Total payables 34,015 41,187

AASB 101.54(m) Interest Bearing LiabilitiesLoans 9A 3,327 4,592 Leases 9B 7,192 10,205 Other 9C 2,058 2,363 Total interest bearing liabilities 12,577 17,160

AASB 101.54(l) ProvisionsEmployee provisions 10A 50,958 45,998 Other 10B 3,523 3,436 Total provisions 54,481 49,434 Total Liabilities 101,073 107,781 Net Assets 174,707 149,722

BALANCE SHEET for Not-For-Profit Reporting Entitiesas at 30 June 2010


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Reference 2010 2009$’000 $’000

EQUITYParent Entity Interest

AASB 101.54(r) Contributed equity 60,583 59,583 AASB 101.54(r) Reserves 108,981 107,114

Retained surplus 5,143 (16,975)Total parent entity interest 174,707 149,722 Total Equity 174,707 149,722

POLICY

AASB 101.60

GUIDANCE

AASB 101.32

AASB 101.77

AASB 101.55

AASB 137.27, 31

Goods and Services TaxInt 1031.6-8

Int 1031.9

AASB 101 Presentation of Financial Statements advises entities to apply a presentation based on liquidity when such a presentation provides information that is reliable and more relevant. Not-for-profit Australian Government entities shall use the liquidity presentation of assets and liabilities.

Balance Sheet Items

The above statement should be read in conjunction with the accompanying notes.

Form of Statement

Assets and liabilities shall not be offset unless required or permitted by an Australian Accounting Standard.

An entity shall disclose, either on the face of the balance sheet or in the notes, further sub-classifications of the line items presented, classified in a manner appropriate to the entity's operations.

Additional line items, headings and sub-totals shall be presented on the face of the balance sheet when such a presentation is relevant to an understanding of the entity's financial position.

Contingent liabilities and contingent assets must not be recognised in the balance sheet.

Assets, except receivables, must be recognised net of the amount of goods and services tax (GST), except where GST incurred is not recoverable from the taxation authority. Where this is the case, GST shall be recognised as part of the cost of acquisition of an asset.

The net amount of GST recoverable from, or payable to, the taxation authority must be included as a payable/receivable on the balance sheet.


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Reference STATEMENT OF CHANGES IN EQUITY for Not-For-Profit Reporting Entities

2010 2009 2010 2009 2010 2009 2010 2009AASB 101.106(d) $’000 $'000 $’000 $’000 $’000 $’000 $’000 $’000

Opening balanceBalance carried forward from previous period (16,975) (1,172) 107,114 103,117 59,583 39,720 149,722 141,665 Adjusted opening balance (16,975) (1,172) 107,114 103,117 59,583 39,720 149,722 141,665

Comprehensive incomeOther comprehensive income - Changes in asset revaluation reserves - - 1,867 3,997 - - 1,867 3,997 Surplus for the period 22,118 9,053 22,118 9,053

AASB 101.106(a) Total comprehensive income 22,118 9,053 1,867 3,997 - - 23,985 13,050 of which:

AASB 101.106(a) Attributable to the Australian Government 22,118 9,053 1,867 3,997 - - 23,985 13,050

AASB 101.106(c) Transactions with ownersDistributions to ownersReturns on capital:

AASB 101.107 Dividends - (24,856) - - - - - (24,856)Contributions by ownersAppropriation (equity injection) - - - - 1,000 18,430 1,000 18,430

AASB 1004.48 Restructuring - - - - - 1,433 - 1,433 Sub-total transactions with owners - (24,856) - - 1,000 19,863 1,000 (4,993)

AASB 101.106(a) Closing balance as at 30 June 5,143 (16,975) 108,981 107,114 60,583 59,583 174,707 149,722 Closing balance attributable to the Australian Government 5,143 (16,975) 108,981 107,114 60,583 59,583 174,707 149,722


for the period ended 30 June 2010

reserveAsset revaluation Contributed

equity/capitalRetained earnings Total equity


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Reference GUIDANCE

Restructures AASB 1004.54-59

Other Reserves

AASB 110.13

AASB 101.137(a)

AASB 110.12-13 FMO 41.1-3

Dividend recognition requirements are summarised in FMO sections 41.1 - 41.3.

An entity shall disclose in the notes the amount of dividends proposed or declared before the financial report was authorised for issue but not recognised as a distribution to equity holders during the period, and the related amount per share (if applicable).

If dividends are declared (i.e. the dividends are appropriately authorised and no longer at the discretion of the entity) after the reporting date but before the financial report is authorised for issue, the dividends are not recognised as a liability at the reporting date because they do not meet the criteria of a present obligation in AASB 137 Provisions, Contingent Liabilities and Contingent Assets. Such dividends are disclosed in the notes in the financial report in accordance with AASB 101 Presentation of Financial Statements .

Dividends

Paragraphs 54-59 require restructures to be treated as direct adjustments to equity.

Entities should disclose each different type of reserve as a separate column in the statement of changes in equity.


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Reference

2010 2009AASB 107.18(a) Notes $’000 $’000FMO 60.1

AASB 107.10 OPERATING ACTIVITIESCash receivedGoods and services 203,848 189,540 Appropriations 151,291 89,770

AASB 107.31 Interest - 42 Int 1031.11 Net GST received 2,613 1,675

Total cash received 357,752 281,027

Cash usedEmployees 115,368 100,067 Suppliers 210,206 140,781

AASB 107.31 Borrowing costs 663 129 Other 6,365 17,272 Total cash used 332,602 258,249 Net cash from operating activities 12 25,150 22,778

AASB 107.10 INVESTING ACTIVITIESAASB 107.21 Cash received

Proceeds from sales of property, plant and equipment 5,580 4,450 Total cash received 5,580 4,450

AASB 107.21 Cash usedPurchase of property, plant and equipment 26,218 13,210 Purchase of financial instruments - 1,000 Total cash used 26,218 14,210 Net used by investing activities (20,638) (9,760)

AASB 107.10 FINANCING ACTIVITIESAASB 107.21 Cash received

Contributed equity 1,000 18,430 Total cash received 1,000 18,430

AASB 107.21 Cash usedRepayment of borrowings 1,541 3,602 Dividends paid - 24,856 Other 3,013 -Total cash used 4,554 28,458 Net cash used by financing activities (3,554) (10,028)Net increase in cash held 958 2,990

Cash and cash equivalents at the beginning of the reporting period 6,131 3,141 Cash and cash equivalents at the end of the reporting period 6A 7,089 6,131


CASH FLOW STATEMENT for Not-For-Profit Reporting Entitiesfor the period ended 30 June 2010


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Reference

AASB 107.4

Cash Flows in a Foreign CurrencyAASB 107.25

Restrictions on Use of Cash BalancesAASB 107.48

Int 1031.10

Int 1031.11

GUIDANCE

Purpose

The GST component of cash flows arising from investing and financing activities which is recoverable from, or payable to, the taxation authority shall be classified as cash flows from operating activities.

A cash flow statement, used in conjunction with the rest of the financial report, provides information for users to evaluate the changes in net assets of an entity, its financial structure (including its liquidity and solvency) and its ability to affect the amounts and timing of cash flows in order to adapt to changing circumstances and opportunities.

Cash flows arising from transactions in a foreign currency are recorded in Australian dollars by applying the exchange rate between the functional currency and the foreign currency at the date of the cash flow to the foreign currency amount.

Agencies should consider money held by outsiders in the context of AASB 107 Statement of Cash Flows paragraph 48.

Cash flows shall be included in the cash flow statement on a gross basis, subject to Int. 1031 Accounting for the Goods and Services Tax (GST) paragraph 11 and to AASB 107 Statement of Cash Flows.

GST

The amount of significant cash and cash equivalents held by the entity that are not available for use by the group (parent and other subsidiaries) are to be disclosed, together with explanatory commentary by management on restrictions of use.


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Reference SCHEDULE OF COMMITMENTS for Not-For-Profit Reporting Entities

2010 2009FMO 81 BY TYPE $’000 $’000

Commitments receivableGST recoverable on commitments 181 181 Total commitments receivable 181 181

Commitments payableAASB 101.Aus138.6 Capital commitments

Land and buildings 1 2,000 2,000

Property, plant and equipment 2 2,000 3,500 Total capital commitments 4,000 5,500

AASB 101.Aus138.6 Other commitmentsOperating leases 3 135,145 123,847 Total other commitments 135,145 123,847 Net commitments by type 139,145 129,347

BY MATURITY


One year or less 4,000 1,500 From one to five years - 4,000 Total capital commitments 4,000 5,500

AASB 117.35(a) Operating lease commitmentsOne year or less 31,111 13,255 From one to five years 104,034 65,400 Over five years - 45,192 Total operating lease commitments 135,145 123,847 Net commitments by maturity 139,145 129,347

as at 30 June 2010

NB: Commitments are GST inclusive where relevant.

1. Outstanding contractual payments for buildings under construction.

2. Plant and equipment commitments are primarily contracts for purchases of furniture and fittings for a new building.

3. Operating leases included are effectively non-cancellable.


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Reference Nature of lease/General description of leasing arrangement

Leases for office accommodation.

GUIDANCE

AASB 101.Aus138.6

Agreements for the provision of motor vehicles to senior executive officers.

No contingent rentals exist. There are no renewal or purchase options available to the Agency.

A lease in relation to computer equipment held as at 30 June 2008 which was sold and leased back on 1 July 2008.

The lessor provides all computer equipment and software designated as necessary in the supply contract for five years plus for a further two years at the Agency’s option on the same terms and conditions. The initial equipment has on average a useful life of two years from the commencement of the contract. The Agency may vary its originally designated requirement, subject to giving three months notice, at no penalty.

Where an entity has no commitments, refer to FMO section 81.2 for disclosure requirements.

Classes of commitments must be disclosed as outlined in FMO section 81.1.

Commitments of other parties to entities must be disclosed as commitments receivable.

• grant commitments for health or education services.

This schedule should be read in conjunction with the accompanying notes.

AASB 101 Presentation of Financial Statements requires disclosure of the nature and amount of each individual commitment and each class of capital commitments and of other expenditure commitments contracted for as at the reporting date (other than commitments for the supply of inventories) which have not been recognised as liabilities. Time bands for the disclosure are prescribed in AASB 101.

POLICY

Disclosure of Commitments

Disclosure of Commitments

• capital commitments for specialised military equipment should be distinguished from commitments for property, plant and equipment; and

Where separate disclosure of material categories of commitments has not been provided for in PRIMA, additional line items must be added by entities. For example:

Many commitments arise out of contractual obligations that are not recognised as liabilities because they arise under Agreements that are Equally Proportionately Unperformed (AEPU) and no accounting standard requires recognition. For example, an operating lease of office space is an AEPU to the extent that the benefit of future use of the space and the obligation to pay for the use of that space have not been affected.

Lease payments are subject to annual increase in accordance with upwards movements in the Consumer Price Index. The initial periods of office accommodation leases are still current and each may be renewed for up to five years at the Agency’s option, following a once-off adjustment of rentals to current market levels.


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Reference Joint Ventures

Int 1031

AASB 117.35(a)

AASB 117.35(b)

AASB 117.35(c)

AASB 117.35(d)

AASB 117.65

Paragraph 55 of AASB 131 Interests in Joint Ventures sets out the disclosure requirements for commitments that relate to joint ventures.

Commitments and the GST

Operating Leases – Disclosure by Lessees

Where commitments include GST, refer to FMO section 81.4.

The disclosure requirements for lessees apply equally to sale and leaseback transactions. Unique or unusual provisions of the agreement or terms of the sale and leaseback transaction are required to be disclosed. In PRIMA, it is assumed there are no unique or unusual provisions in the sale and lease back transactions. However if such were the case, the required disclosures would need to be made.

• the basis on which contingent rental payments are determined;

(iii) lease and sublease payments recognised as an expense in the period, with separate amounts for minimum lease payments, contingent rents, and sublease payments; and

(iv) a general description of the lessee’s leasing arrangements including, but not limited to, the following:

debt, and further leasing. • restrictions imposed by lease arrangements, such as those concerning dividends, additional

• the existence and terms of renewal or purchase options and escalation clauses; and

(ii) for non-cancellable sub-leases, the total of future minimum lease payments expected to be received as at the reporting date;

The following information must be disclosed separately by a lessee in respect of operating leases:

• later than one year and not later than five years; and

• later than five years;

• not later than one year;

(i) for non-cancellable operating leases, the total of future minimum lease payments in the following time bands:


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Reference SCHEDULE OF CONTINGENCIES for Not-For-Profit Reporting Entities

as at 30 June 2010

2010 2009FMO 80 $’000 $’000

Contingent assetsClaims for damages or costs 115 150 Total contingent assets 115 150

Contingent liabilitiesClaims for damages or costs 13 13 Total contingent liabilities 13 13 Net contingent assets 102 137

FMO 80.1,2

The above schedule should be read in conjunction with the accompanying notes.

AASB 137.86(a)

Joint Ventures

FMO 80.1

Financial Guarantee ContractsFMO 80.53P

Measurement

Refer to FMO section 80.5 - 80.7 for disclosure requirements for contingent assets and liabilities.

Entities must report all relevant contingent assets and contingent liabilities under their applicable classes. In addition to the above classifications in the schedule of contingencies, examples of other classes include warranties, letters of comfort and uncalled shares or capital subscriptions.

Total contingent liabilities must not be presented net of total contingent assets. The extent to which any contingent liability is inextricably linked to a contingent asset can be stated separately.

A financial guarantee contract as defined in AASB 139 Financial Instruments: Recognition and Measurement paragraph 9 should be accounted for in accordance with that standard and not as a contingent liability (as AASB 137 excludes financial instruments from its scope). However, FMO section 80.53P contains additional disclosure requirements.

AASB 137.86-92

GUIDANCE

Details of each class of contingent liabilities and contingent assets listed above are disclosed in Note 13: Contingent Liabilities and Assets, along with information on significant remote contingencies and contingencies that cannot be quantified.

Where it is practical to make an estimate, contingent liabilities and contingent assets must be measured in accordance with AASB 137 Provisions, Contingent Liabilities and Contingent Assets paragraphs 36-52.

Paragraph 54 of AASB 131 Interests in Joint Ventures sets out the disclosure requirements for contingencies that relate to joint ventures. Paragraph 40 of AASB 128 Investments in Associates sets out the disclosure requirements for contingencies that relate to investment in associates.

Where an entity has no contingencies, refer to FMO section 80.3 for disclosure requirements.

Presentation and Disclosure


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Reference SCHEDULE OF ASSET ADDITIONS for Not-For-Profit Reporting Entities


The following non-financial non-current assets were added in 2009-10:

BuildingsHeritage &

cultural

Other property, plant &

equipment Intangibles Total$’000 $’000 $’000 $’000 $’000

By purchase - appropriation equity - 5,550 4,505 2,500 12,555 By purchase - appropriation ordinary annual services - 5,000 6,448 2,636 14,084 Total additions - 10,550 10,953 5,136 26,639

The following non-financial non-current assets were added in 2008-09:

BuildingsHeritage &

cultural


equipment Intangibles Total$’000 $’000 $’000 $’000 $’000

By purchase - appropriation equity 1,025 - - 375 1,400 By purchase - appropriation ordinary annual services 1,475 - - 725 2,200 Total additions 2,500 - - 1,100 3,600


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Reference

2010 2009Notes $’000 $’000

AASB 1050.7(a)(i)

Revenue

Non-taxation revenueSale of goods and rendering of services 17A 180,797 188,199 Interest 17B 135 231 Dividends 17C 1,817 1,600 Total non-taxation revenue 182,749 190,030 Total revenues administered on behalf of Government 182,749 190,030

GainsOther 17D - 627

- 627

182,749 190,657

AASB 1050.7(b)(i)


Suppliers expenses 18A 6,594 3,511 Subsidies 18B 32,002 21,124 Personal benefits 18C 20,200 20,200 Grants 18D 88,959 53,656 Write-down and impairment of assets 18E - 240 CAC Act body payment item 18F 40,850 65,568 Other 18G 1,931 130

190,536 164,429 This schedule should be read in conjunction with the accompanying notes.

SCHEDULE OF ADMINISTERED ITEMS

Expenses administered on behalf of Government

Administered revenues collected on behalf of the Government are remitted to the Official Public Account and do not directly fund liabilities and expenses incurred by the agency on behalf of the Government (except in the case of Administered Special Accounts). Accordingly, no administered result is reported.

GUIDANCE

Income administered on behalf of Government


Total gains administered on behalf of Government

Total expenses administered on behalf of Government

Total income administered on behalf of Government


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Reference SCHEDULE OF ADMINISTERED ITEMS

2010 2009Notes $’000 $’000

AASB 1050.7(c)

as at 30 June 2010

Financial assetsCash and cash equivalents 19A 1,332 2,048 Receivables 19B 10,461 15,137 Other investments 19C 15,325 15,566

Total financial assets 27,118 32,751 Total assets administered on behalf of Government 27,118 32,751

AASB 1050.7(d)

as at 30 June 2010

PayablesSuppliers 20A 1,505 1,832 Grants 20B 3,975 2,683 Total payables 5,480 4,515

5,480 4,515

Liabilities administered on behalf of Government

Total liabilities administered on behalf of Government

Assets administered on behalf of Government



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2010 2009Notes $’000 $’000

AASB 107.1

AASB 107.10 OPERATING ACTIVITIESCash receivedSales of goods and rendering of services 183,171 221,000

AASB 107.31 Interest 120 223 AASB 107.31 Dividends 1,817 1,600

Total cash received 185,108 222,823

Cash usedGrant payments 87,592 67,592 Subsidies paid 32,077 23,106 Personal benefits 20,220 22,220 Suppliers 5,576 3,992 CAC Act body payment item 40,850 65,568 Other 1,325 2,845 Total cash used 187,640 185,323

Net cash used by operating activities (2,532) 37,500

AASB 107.10 INVESTING ACTIVITIESAASB 107.21 Cash Received

Repayments of advances and loans - 18,500 Total cash received - 18,500

AASB 107.21 Cash usedPurchase of property, plant and equipment - 1,900 Advances and loans made - 13,500 Total cash used - 15,400

Net cash flows from investing activities - 3,100

Net Decrease in Cash Held (2,532) 40,600

Cash and cash equivalents at the beginning of the reporting period 2,048 43,077 Cash from Official Public Account for:

-Appropriations 187,120 200,615 -Special accounts 520 143

187,640 200,758

Cash to Official Public Account for:

- Appropriations (187,956) (241,323) - Special accounts (400) (464)

(188,356) (241,787)

Cash and cash equivalents at the end of the reporting period 19A 1,332 2,048



Cash Flows to/from the OPA

Section 60.3 in the FMO requires cash flows to/from the Official Public Account (including appropriations drawn down for payment to CAC Act bodies) to be shown as adjustments to administered cash held by an agency, rather than as a cash flow related to operating or other activities.

GUIDANCE

Administered Cash Flows


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2010 2009FMO 81 $’000 $’000

Administered Commitmentsas at 30 June 2010

BY TYPE


Other 130,750 161,000 Total capital commitments 130,750 161,000 Net commitments by type 130,750 161,000

BY MATURITY

Commitments payable

Capital commitmentsOne year or less 39,800 40,250 From one to five years 80,950 120,750 Over five years 10,000 -Total capital commitments 130,750 161,000 Net commitments by maturity 130,750 161,000 NB: Commitments are GST inclusive where relevant.


Other capital commitments relate to grant amounts payable under agreements in respect of which the grantee has yet to provide the services required. It comprises mainly grants under the Supported Training Assistance Program to State and Territory governments under individual five-year funding agreements. The current agreements were made in 2006-07 covering the period 2007-2012.


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Administered Contingenciesas at 30 June 2010

AASB 137.86-92 2010 2009FMO 80 $’000 $’000

Administered contingent liabilitiesGuarantees 11,000 13,000 Indemnities 2,100 4,700 Total administered contingent liabilities 13,100 17,700 Net administered contingent liabilities (13,100) (17,700)

SCHEDULE OF ADMINISTERED ITEMS

FMO 82.2 The Prima Agency has no asset additions in either the current or the immediately preceding reporting periods.

There is a requirement to state, in the heading or as a footnote in the schedule of administered items, a brief description of the activities being administered on behalf of the Australian Government.

Administered Activities

POLICY

Details of each class of contingent liabilities and contingent assets in the above table are disclosed in Note 22: Administered Contingent Assets and Liabilities, along with information on significant remote contingencies and contingencies that cannot be quantified.

The above schedule should be read in conjunction with the accompanying notes.


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Reference Note 1: Summary of Significant Accounting Policies

GUIDANCE

1.1 Objectives of PRIMA Agency

AASB 1052.15(b) The Agency is structured to meet two outcomes:

FMO 15

AASB 1052.15a

1 2 Basis of Preparation of the Financial Statements

PRIMA Agency is an Australian Government controlled entity. The objective of PRIMA Agency is to enhance Australian Fauna and Flora.

Outcome 1: To preserve and protect Australian Fauna and Flora for current and future generations.

Outcome 2: To facilitate appropriate access to training and employment opportunities in the field of Australian Fauna and Flora.

Departmental activities are identified under three Outputs. One Output is identified for Outcome 1. Two outputs, Output 2.1 Environmental Enterprise and Output 2.2 Education Services relate to Outcome 2.

Agencies must tailor Note 1 to reflect their individual circumstances. This includes removing any sections which are not relevant to their operations. For example, agencies should remove information regarding categories of financial instruments that they do not hold in 1.12 Financial Assets and in 1.13 Financial Liabilities. Conversely, Agencies must also add any other details that provide meaningful information to users.

Generic references within this note, such as references to PRIMA Agency should also be amended, where appropriate, to make specific reference to the agency preparing the financial statements.

Agencies should note that Note 1 is only intended to include common disclosures, and as such should not be relied upon as an exhaustive list of all information that is required or may be useful to disclose.

The continued existence of the Agency in its present form and with its present programs is dependent on Government policy and on continuing appropriations by Parliament for the Agency’s administration and programs.

Agency activities contributing toward these outcomes are classified as either departmental or administered. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the Agency in its own right. Administered activities involve the management or oversight by the Agency, on behalf of the Government, of items controlled or incurred by the Government.


1.2 Basis of Preparation of the Financial Statements

AASB 101.Aus15.2

AASB 101.27 AASB 101.117(a)

AASB 101.51(d)

FMO 13

FMO 85

The financial statements are required by section 49 of the Financial Management and Accountability Act 1997 and are general purpose financial statements.

The Financial Statements have been prepared in accordance with:

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.

Unless an alternative treatment is specifically required by an accounting standard or the FMO, 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 of 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 unrecognised are reported in the schedule of commitments or the schedule of contingencies.

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 1.24.

FMO 8.2(a)

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.

• Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.

• Finance Minister’s Orders (or FMO) for reporting periods ending on or after 1 July 2009; and

thousand dollars unless otherwise specified.The financial statements are presented in Australian dollars and values are rounded to the nearest


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Reference 1.3 Significant Accounting Judgements and Estimates

AASB 101.122

AASB 101.125

1.4 New Australian Accounting Standards

AASB 108.28 Adoption of New Australian Accounting Standard Requirements

Future Australian Accounting Standard Requirements

AASB 108.30-31

• The fair value of land and buildings has been taken to be the market value of similar properties as determined by an independent valuer. In some instances, PRIMA buildings are purpose-built and may in fact realise more or less in the market.

No accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next accounting period.

No accounting standard has been adopted earlier than the application date as stated in the standard. Of the new standards, amendments to standards and interpretations issued by the Australian Accounting Standards Board that are applicable to the current period, the following have had a material financial impact on PRIMA Austhority.

In the process of applying the accounting policies listed in this note, PRIMA Agency has made the following judgements that have the most significant impact on the amounts recorded in the financial statements:

Other [new standards/revised standards/interpretations/amending standards] that were issued prior to the signing of the t t t b th hi f ti d hi f fi i l ffi d li bl t th f t ti i d t

(Separate guidance will be provided by Finance after 30 June on new accounting standards applicable to current and future reporting periods).

(Separate guidance will be provided by Finance after 30 June on new accounting standards applicable to current and future reporting periods).

Of the new standards, amendments to standards and interpretations issued by the Australian Accounting Standards Board that are applicable to future periods, the following have had a material financial impact on PRIMA Agency

Other [new standards/revised standards/interpretations/amending standards] that were issued prior to the signing of the statement by the chief executive and chief financial officer and are applicable to the current reporting period did not have a financial impact, and are not expected to have a future financial impact on the entity.


1.5 Revenue

AASB 118.35(a) Revenue from Government

FMO 101

Appropriations receivable are recognised at their nominal amounts.

Resources Received Free of Charge

Resources received free of charge are recorded as either revenue or gains depending on their nature.

Amounts appropriated for departmental outputs 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.

Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains 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).

statement by the chief executive and chief financial officer and are applicable to the future reporting period are notexpected to have a future financial impact on the entity.

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.


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Reference Other Types of Revenue

AASB 118.14

• the risks and rewards of ownership have been transferred to the buyer;

• the agency retains no managerial involvement or effective control over the goods;

• the revenue and transaction costs incurred can be reliably measured; and

AASB 118.20

AASB 118.24

AASB 118.30(a)

1.6 Gains


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 as gains at their fair value when the asset qualifies for recognition, unless received from another Government agency or authority as a consequence

Resources received free of charge are recorded as either revenue or gains depending on their nature.

• the amount of revenue, stage of completion and transaction costs incurred can be reliably measured; and

• it is probable that the economic benefits associated with the transaction will flow to the entity.

• the probable economic benefits associated with the transaction will flow to the entity.

Revenue from the sale of goods is recognised when:

Revenue from rendering of services is recognised by reference to the stage of completion of contracts at the reporting date. The revenue is recognised when:

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.

Interest revenue is recognised using the effective interest method as set out in AASB 139 Financial Instruments: Recognition and Measurement.

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 as at end of reporting period. Allowances are made when collectability of the debt is no longer probable.


Sale of Assets

1.7 Transactions with the Government as Owner

FMO 101.8 Equity Injections

Int 1038

FMO 101.13

Restructuring of Administrative Arrangements

FMO 92

Other Distributions to Owners

FMO 101.15 FMO 101.16

Gains from disposal of assets are recognised when control of the asset has passed to the buyer.

The FMO require that distributions to owners be debited to contributed equity unless in the nature of a dividend. In 2009-10, by agreement with the Department of Finance and Deregulation, PRIMA Agency relinquished control of surplus output appropriation funding of $6,068,149 which was returned to the Official Public Account. On 20 June 2009, the Finance Minister issued a determination to reduce Departmental Output Appropriations by $6,068,149.

q g , g y y qof a restructuring of administrative arrangements (Refer to Note 1.7).

Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) are recognised directly in contributed equity in that year.

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.


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Reference 1.8 Employee Benefits

AASB 119.10

AASB 119.14

AASB 119.128

LeaveAASB 119.11

AASB 119.128

Separation and RedundancyAASB 119.133

Superannuation

The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by th A t li G t i d Thi li bilit i t d b th D t t f Fi d D l ti

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 Agency is estimated to be less than the annual entitlement for sick leave.

Staff of PRIMA Agency are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS) or the PSS accumulation plan (PSSap).

The liability for long service leave has been determined by reference to the work of an actuary as at 30 June 2010. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will applied at the time the leave is taken, including the Agency’s employer superannuation contribution rates to the extent that the leave ilikely to be taken during service rather than paid out on termination.

The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

Other long-term employee benefits are measured as net total of the present value of the defined benefit obligation at the endof the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

Provision is made for separation and redundancy benefit payments. PRIMA Agency recognises a provision for terminationwhen it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.

Liabilities for ‘short-term employee benefits’ (as defined in AASB 119 Employee Benefits ) and termination benefits due within twelve months of the end of reporting period are measured at their nominal amounts.

The CSS and PSS are defined benefit schemes for the Australian Government. The PSSap is a defined contribution scheme.


1.9 Leases

AASB 117.4

AASB 117.20

AASB 117.33

AASB 2009-1 1.10 Borrowing Costs

All borrowing costs are expensed as incurred.

the Australian Government in due course. This liability is reported by the Department of Finance and Deregulation as anadministered item.

The discount rate used is the interest rate implicit in the lease. Leased assets are amortised over the period of the lease. Lease payments are allocated between the principal component and the interest expense.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.

Where an asset is acquired by means of a finance lease, the asset is capitalised at either the fair value of the lease property or, if lower, the present value of minimum lease payments at the inception of the contract and a liability is recognised at the same time and for the same amount.

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 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 straight-line basis which is representative of the pattern of benefits derived from the leased assets.

PRIMA Agency makes employer contributions to the employee superannuation scheme at rates determined by an actuary tobe sufficient to meet the current cost to the Government of the superannuation entitlements of the Agency’s employees. PRIMA Agency accounts for the contributions as if they were contributions to defined contribution plans.


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Reference 1.11 Cash

AASB 107.6

1.12 Financial Assets

AASB 7.21

Effective Interest Method

AASB 139.9 Financial Assets at Fair Value Through Profit or Loss

Assets in this category are classified as current assets.

PRIMA Agency classifies its financial assets in the following categories:

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.

Cash and cash equivalents includes cash on hand, cash held with outsiders, 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. Cash is recognised at its nominal amount.

• financial assets at fair value through profit or loss;

• available-for-sale financial assets; and

• are derivatives that are not designated and effective as a hedging instrument.

The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.

Income is recognised on an effective interest rate basis except for financial assets that are recognised at fair value through profit or loss.

• are a part of an identified portfolio of financial instruments that the Agency manages together and has a recent actual pattern of short-term profit-taking; or

• loans and receivables.

Financial assets are recognised and derecognised upon trade date.

• held-to-maturity investments;

• have been acquired principally for the purpose of selling in the near future;

Fi i l t t f i l th h fit l t t d t f i l ith lt t i l i d i

Financial assets are classified as financial assets at fair value through profit or loss where the financial assets:


Available-for-Sale Financial AssetsAASB 139.9

AASB 7 Appx B5

Held-to-Maturity Investments

AASB 139.9 Loans and Receivables

Non-derivative financial assets with fixed or determinable payments and fixed maturity dates that the group has the positive intent and ability to hold to maturity are classified as held-to-maturity investments. Held-to-maturity investments are recorded at amortised cost using the effective interest method less impairment, with revenue recognised on an effective yield basis.

Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.

Financial assets at fair value through profit or loss are stated at fair value, with any resultant gain or loss recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest earned on the financial asset.

Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories.

Where a reliable fair value cannot be established for unlisted investments in equity instruments cost is used. PRIMA Agency has no such instruments.

Available-for-sale financial assets are recorded at fair value. Gains and losses arising from changes in fair value are recognised directly in reserves (equity) with the exception of impairment losses. Interest is calculated using the effective interest method and foreign exchange gains and losses on monetary assets are recognised directly in profit or loss. Where the asset is disposed of or is determined to be impaired, part (or all) of the cumulative gain or loss previously recognised in the reserve is included in profit and loss for the period.


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Reference Impairment of Financial AssetsFMO 45.4 Financial assets are assessed for impairment at end of each reporting period.

AASB 139.63

AASB 139.67

AASB 139.66

1.13 Investments in Associates

AASB 128.13

AASB 128.23

AASB 131.30

1.15 Financial Liabilities

Financial liabilities are recognised and derecognised upon ‘trade date’.

1.14 Jointly Controlled Entities

Interests in jointly controlled entities in which the PRIMA Agency is a venturer (and so has joint control) are accounted for using the equity method.

• 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 statement of comprehensive income.

• Financial assets held at cost - If there is objective evidence that an impairment loss has been incurred the amount of the impairment loss is the difference between the carrying amount of the asset and the present value of the estimated future cash flows discounted at the current market rate for similar assets.

PRIMA Agency’s investment in its associates is accounted for using the equity method.

Under the equity method, investments in the associates are carried in the Agency’s balance sheet at cost as adjusted for post-acquisition changes in the Agency’s share of net assets of the associates. Goodwill relating to an associate is included in the carrying amount of the investment. After the application of the equity method, the Agency determines whether it is necessary to recognise any impairment loss with respect to the net investment in associates.

• Available for sale financial assets - if there is objective evidence that an impairment loss on an available-for-sale financial asset has been incurred, the amount of the difference between its cost, less principal repayments and amortisation, and its current fair value, less any impairment loss previously recognised in expenses, is transferred from equity to the statement of comprehensive income.

Financial liabilities are classified as either financial liabilities ‘at fair value through profit or loss’ or other financial liabilities.


AASB 7.21 Financial Liabilities at Fair Value Through Profit or Loss

Other Financial Liabilities

AASB 139.47

1.16 Contingent Liabilities and Contingent Assets

AASB 137.27-28

1.17 Financial Guarantee Contracts

Other financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs.

Financial liabilities at fair value through profit or loss are initially measured at fair value. Subsequent fair value adjustments are recognised in profit or loss. The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability.

The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, where appropriate, a shorter period.

Supplier 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).

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 asset or liability in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.

Financial guarantee contracts are accounted for in accordance with AASB 139 Financial Instruments: Recognition and Measurement . They are not treated as a contingent liability, as they are regarded as financial instruments outside the scope of AASB 137 Provisions, Contingent Liabilities and Contingent Assets .


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Reference 1.18 Acquisition of Assets

AASB 116.15

FMO 92 AASB 116.Aus.15.1

1.19 Property, Plant and Equipment

Asset Recognition ThresholdAASB 116.15

AASB 116.16(c)

RevaluationsAASB 116.77(d) Fair values for each class of asset are determined as shown below:

Purchases of property, plant and equipment are recognised initially at cost in the Balance Sheet, except for purchasescosting less than $2,000, which are expensed in the year of acquisition (other than where they form part of a group ofsimilar 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 onwhich it is located. This is particularly relevant to ‘makegood’ provisions in property leases taken up by PRIMA Agencywhere there exists an obligation to restore the property to its original condition. These costs are included in the value ofPRIMA’s leasehold improvements with a corresponding provision for the ‘makegood’ recognised.

Assets are recorded at 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 income 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.

Market selling priceHeritage and cultural assets

Market selling priceInfrastructure, plant and equipment

Depreciated replacement costLeasehold improvements

Market selling priceBuildings exc. Leasehold improvements

Market selling priceLand

Fair value measured atAsset Class

Market selling priceHeritage and cultural assets

Market selling priceInfrastructure, plant and equipment

Depreciated replacement costLeasehold improvements

Market selling priceBuildings exc. Leasehold improvements

Market selling priceLand

Fair value measured atAsset Class


AASB 116.31

AASB 116.39

AASB 116.35

DepreciationAASB 116.50 AASB 116.60AASB 116 51AASB 116.56 and 61

AASB 116.73(c)

2010 2009Buildings on freehold land 60 years 60 years Leasehold improvements Lease term Lease termPlant and Equipment 4 to 9 years 3 to 7 years

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated to the revalued amount.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

Depreciable property, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to PRIMA Agency using, in all cases, the straight-line method of depreciation.

Depreciation 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.

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 revaluation increment for that class.

Following initial recognition at cost, property plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. 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.

All heritage and cultural assets have indefinite useful lives and are not depreciated.


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Reference ImpairmentAASB 136.9

AASB 136.6 AASB 136.Aus32.1

DerecognitionAASB 116.67

1.20 Investment Properties

AASB 140.20, 30, 35, 38, 75(a)

AASB 140.Aus20.1

AASB 140.69

FMO 33.3 1.21 Intangibles

AASB 138.118(a),(b)

AASB 136 9

An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

All ft t d f i di ti f i i t t 30 J 2010

PRIMA Agency’s intangibles comprise internally developed software for internal use. These assets are carried at cost less accumulated amortisation and accumulated impairment losses.

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 PRIMA Agency were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

All assets were assessed for impairment at 30 June 2010. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.

Software is amortised on a straight-line basis over its anticipated useful life. The useful lives of PRIMA Agency’s software are 7 to 10 years (2008-09: 7 to 10 years).

Investment properties are measured initially at cost, including transaction costs. Subsequent to initial recognition, investment properties are stated at fair value, which is based on active market prices, adjusted if necessary, for any difference in the nature, location or condition of the specific asset at the balance sheet date. Gains or losses arising from changes in the fair values of investment properties are recognised in profit or loss in the year in which they arise.

Investment properties are derecognised either when they have been disposed of or when the investment property is permanently withdrawn form use and no future economic benefit is expected from its disposal. Any gain or losses on disposal of an investment property are recognised in profit or loss in the year of disposal.

Where an investment property is acquired at no cost or for nominal cost, its cost is deemed to be its fair value as at the date of acquisition.


AASB 136.9

1.22 Inventories

AASB 102.9 Inventories held for sale are valued at the lower of cost and net realisable value.

AASB 102.Aus9.1 Inventories held for distribution are valued at cost, adjusted for any loss of service potential.

AASB 102.11 • raw materials and stores – purchase cost on a first-in-first-out basis; and

AASB 102.12

AASB 102.Aus10.1

1.23 Taxation / Competitive Neutrality

Int 1031.6-8

Revenues, expenses and assets are recognised net of GST except:

• for receivables and payables.

Competitive NeutralityFMO 123

• where the amount of GST incurred is not recoverable from the Australian Taxation Office; and

The Education Services Division within the Agency provides services on a for-profit basis. Under CompetitiveNeutrality arrangements, Educational Services is required to make Australian Income Tax Equivalent payments to theGovernment, in addition to payments for FBT and GST.

• finished goods and work-in-progress – cost of direct materials and labour plus attributable costs that can be allocated on a reasonable basis.

The Agency is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).

Inventories acquired at no cost or nominal consideration are initially measured at current replacement cost at the date of acquisition.

All software assets were assessed for indications of impairment as at 30 June 2010.

Costs incurred in bringing each item of inventory to its present location and condition are assigned as follows:


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Reference 1.24 Reporting of Administered Activities

FMO 75.1

Administered Cash Transfers to and from the Official Public Account

Revenue

AASB 118.35

Loans and Receivables

AASB 139.9 AASB 139.46

Administered Investments

All administered revenues are revenues relating to the course of ordinary activities performed by the Agency on behalf of the Australian Government.

Revenue is generated from fees that are charged for access to reserves holding protected Australian fauna and flora. Administered fee revenue is recognised when access occurs. Collectablilty of debts is reviewed at end of reporting period. Allowances are made when collectability of the debt is judged to be less, rather than more, likely.

Administered investments in subsidiaries, joint ventures and associates are not consolidated because their consolidation is relevant only at the Whole of Government level.

Revenue collected by PRIMA Agency for use by the Government rather than the agency is administered revenue. Collections are transferred to the Official Public Account 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 21.

Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the schedule of administered items andrelated notes.

Where loans and receivables are not subject to concessional treatment, they are carried at amortised cost using the effective interest method. Gains and losses due to impairment, derecognition and amortisation are recognised through profit or loss.

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.


FMO 87.2

Financial Guarantee Contracts

Guarantees to Subsidiaries, Joint Ventures and Associates

Other Guarantees

As for guarantees to controlled entities.

Indemnities

The maximum amounts payable under the indemnities given is disclosed in the schedule of administered items - contingencies. At the time of completion of the financial statements, there was no reason to believe that the indemnities would be called upon, and no recognition of any liability was therefore required.

The amounts guaranteed by the Commonwealth have been disclosed in the schedule of administered items and Note 20. At the time of completion of the financial statements, there was no reason to believe that the guarantees would be called upon, and recognition of a liability was therefore not required. The guarantees are in relation to lease obligations and are measured at the present value of future lease payments.

Administered investments other than those held for sale are classified as available-for-sale and are measured at their fair value as at 30 June 2010. Fair value has been taken to be the Australian Government's proportional interest in the net assets of the entities as at end of reporting period.

Financial guarantee contracts are accounted for in accordance with AASB 139 Financial Instruments: Recognition and Measurement . They are not treated as a contingent liability, as they are regarded as financial instruments outside the scope of AASB 137 Provisions, Contingent Liabilities and Contingent Assets.

y


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Grants and Subsidies

Payments to CAC Act Bodies

GUIDANCE

AASB 108.10 Accounting Policies

AASB 101.117

AASB 101.122 Judgements and Estimations

AASB 101.125

Changes in Accounting Policies

From 2009-10, payments to CAC Act bodies from amounts appropriated for that purpose are classified as either administered expenses, equity injections or loans of the relevant portfolio department. The appropriation to the department is disclosed in Tables A1, B1, C or F in Note 25.

Accounting policies must be selected to provide relevant and reliable information and be applied to make that information comparable and understandable.

A description must be given of each specific accounting policy that is necessary for an understanding of the financial report.

Judgements made in the application of an entity’s accounting policies that have the most significant impact on its financial statements must be disclosed in the accounting policy note or other notes. This does not include estimates (see below).

Grant and subsidy liabilities are recognised to the extent that (i) the services required to be performed by the grantee have been performed or (ii) the grant eligibility criteria have been satisfied, but payments due have not been made. A commitment is recorded when the Government enters into an agreement to make these grants but services have not been performed or criteria satisfied.

Disclosure of key assumptions regarding the future, and key sources of estimation uncertainty that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next accounting period, must be made in the notes.

Reference

PRIMA Agency administers a number of grant and subsidy schemes on behalf of the Government.


AASB 108.14

Typically, changed accounting policies are to be applied retrospectively.

Some of the formal changes in the accounting policies, as written in this schedule, will not involve a change of accounting policy for an agency if:

Initial Adoption of a Changed Standard or AASB InterpretationAASB 108.19

Adoption of New Australian Accounting Standard RequirementsAASB 108.14

Changes in accounting policy must be accounted for in accordance with the specific transitional provisions in the relevant Australian Accounting Standard. If the standard is silent the change is treated as a change in accounting policy.

Changes in the accounting policies required by this Schedule are voluntary changes under AASB 108, unless they coincide with a mandated change to a Standard or Interpretation.

b) the agency did not have a policy for it.

Otherwise, the disclosure requirements of AASB 108 must be applied.

Changes in accounting policies may only be made to comply with Australian Accounting Standards or to provide more relevant and reliable information.

a) the agency already applied the policy or if the situation to which the policy change applied did not arise for the agency in the prior period; and

The accounting treatment for changes in accounting policies depends on whether a change is made on initial adoption of a Standard (or Interpretation) or is a voluntary change. Entities should refer to AASB 108 Accounting Policies, Changes in Accounting Estimates and Errors to determine the correct accounting treatment.

Separate guidance will be provided by Finance after 30 June on new accounting standards applicable to current and future reporting periods.


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Reference Voluntary Changes in Accounting Policies

AASB 108.22,23

AASB 108.25

Disclosure of Changes in Accounting Policies

AASB 108.29

• in the current reporting period;

• any prior reporting periods presented in the financial report; or

• is expected to have an effect in a subsequent reporting period,

the following disclosures are required:

• the nature of, and reasons for, the change;

• the amount of the adjustment(s), if any, recognised as a revenue or an expense or to the opening balance of accumulated results; and

Going Concern

When it is not practicable to determine the cumulative financial effect, the new accounting policy must be applied prospectively from the earliest date practicable.

• the amount of the adjustment(s) relating to prior reporting periods, including:

On occasions, agency liabilities may exceed agency assets. In these situations, a statement should be added to the accounting policy note to indicate to the reader that the existence of negative net assets does not make the agency insolvent. A suggested form of words is:

PRIMA Agency is part of the legal entity that is the Australian Government, which is ultimately responsible for all the

i) where practicable, the restatement of comparatives to show the information that would have been disclosedin the prior reporting period had the new accounting policy always been applied; and

ii) the amount of the adjustment relating to reporting periods prior to those presented in the financial report.

Where a change in an accounting policy from that applied in the preceding reporting period has an effect:

Subject to paragraph 23 of AASB 108, the cumulative financial effect, up to the end of the preceding reporting period, of a voluntary change in an accounting policy must be calculated as if the new accounting policy had always been applied .


Depreciation

AASB 116.61

AASB 116.51

Asset Capitalisation Thresholds

g y p g y , y pAgency’s debts. The existence of total liabilities in excess of total assets of the Agency as reported in the balance sheet has no bearing on whether the Agency’s debts will be met.

Residual values and useful lives of assets must be reviewed at least at each annual reporting date. If expectations differ from previous estimates, they must be accounted for as a change in an accounting estimate in accordance with AASB 108.

The level at which to set an asset recognition threshold is a matter for each agency according to its circumstances. The threshold should be set at a level which facilitates efficient asset management and recording but does not result in a material misstatement of asset values. Multiple thresholds may be used for different asset classes.

Australian Government agencies have no separate legal personality but are part of the Australian Government and are ‘wound up’ only when the government decides that all their functions are to be performed by another agency or agencies, or are not to be performed at all. This situation does not of itself mean that an agency is not a going concern.

AASB 116 does not permit retrospective adjustment to accumulated depreciation amounts that have been previously recognised as expenses. A changed depreciation rate as a result of a changed estimate of useful life must be applied prospectively to the written down value of the asset.


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Reference

AASB 136.10

AASB 136.8,9

The recoverable amount of an asset is defined in AASB 136 to be 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 an asset. In the case of not-for-profit entities, value in use is the depreciated replacement cost of an asset when the future economic benefits of the asset are not primarily dependent on the asset's ability to generate cash inflows and the entity would replace the asset’s future economic benefits if deprived of them.

Recoverable Amount/Impairment of Property, Plant and Equipment and Intangibles

Intangible assets with an indefinite useful life or not yet available for use, and any goodwill acquired in a business combination are tested for impairment on an annual basis.

Under AASB 136 Impairment of Assets, an entity shall assess at each reporting date whether there is any indication that an asset may be impaired. If such an indication exists, the recoverable amount of the asset must be estimated. Where the asset's carrying amount exceeds its recoverable amount, an impairment adjustment must be made to record the recoverable amount.

All other assets are tested for impairment only where there exists evidence that an asset may be impaired. The assessment of impairment must be done at each reporting date.

Forms of Financial Statements (FMA) Page 36Forms of Financial Statements (FMA) Page 36

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Reference

AASB 110.21

GUIDANCE

AASB 110.3

AASB 110.9(a)

AASB 110.8

AASB 110.10

AASB 110.19

AASB 110.21(a),(b)

• an adjusting event is required to be recognised in the entity's financial statements to reflect the event that occurred after the reporting date. An example of this type of event is where a court case has been settled after the reporting date that confirms there is a present obligation. The entity is required to adjust the previously recognised contingent liability; and

• a non-adjusting event is where the entity does not change amounts recognised for events that occur after the reporting date. An example of a non-adjusting event is where the market value of an investment declines. This is a non-adjusting event as the decline in the market value does not effect the conditions of the investment, but reflects the changes in circumstances in the market.

Note 2: Events After the Reporting Period

On 20 July 2010, the Government announced its intention to outsource delivery of the Training and Employment Support program to the private sector. This decision has the potential to significantly affect the ongoing structure and financial activities of the Agency.

AASB 110 Events after the Reporting Period prescribes the accounting treatment and disclosures applicable to events that occur after the reporting date. It prohibits the preparation of financial reports on a going concern basis if the event types indicate that the going concern assumption is no longer appropriate (see Guidance under Note 1: Going Concern).

Events are classified into two event types:

Disclosure Requirements of Events Occurring after the Reporting Period

The event occurred after end of reporting period and has not been brought to account in this financial report. The financial effect on the Agency’s result, or on administered revenues and expenses, cannot be determined.

An entity shall adjust the amounts recognised in its financial report to reflect adjusting events afterreporting date.

reporting date.

If an entity receives information after the reporting date about conditions that existed at the reporting date, it shall update disclosures that relate to those conditions, in the light of the new information.

If non-adjusting events after the reporting date are material, non-disclosure could influence the economic decisions of users taken on the basis of the financial statements. Accordingly, an entity shall disclose the following for each material category of non-adjusting event after the reporting date:

An entity shall not adjust the amounts recognised in its financial report to reflect non-adjusting events after

• the nature of the event; and

• an estimate of its financial effect, or a statement that such an estimate cannot be made.


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Reference Note 3: Expenses

2010 2009$’000 $’000

Note 3A: Employee BenefitsWages and salaries 82,950 65,665

AASB 119.46 Superannuation:Defined contribution plans 9,544 3,534 Defined benefit plans 2,688 -

Leave and other entitlements 16,899 14,751 Separation and redundancies 1,262 629 Total employee benefits 113,343 84,579

FMO 23.52P(b)

AASB 119.136

Defined Benefit PlansAASB 119.27(b)

AASB 119.120AAASB 119.Aus78.1

FMO 90.1

FMA Orders 2008 6.1

Plans where the actuarial risk falls on the agency must be accounted for as defined benefit plans.

Employee Movements

Refer to FMO section 44.5 for the discount rate for defined benefit plans.

The FMA Orders 2008 apply in respect of employees moving from one agency to another or to an Australian Government authority. The Orders require that an amount in respect of accrued annual leave and accrued long service leave be transferred with the employee, in accordance with the detailed requirements of the Orders. It should be noted that these Orders do not apply if the move is as a direct consequence of the transfer of a Government function.

Extensive disclosures are required for defined benefits plans and include reconciliations of the present value of the defined benefit obligation, the fair value of plan assets and the total expenses recognised. Disclosures of defined benefit plans are not illustrated.

Separation and Redundancy/Termination Benefits

Refer to FMO section 23.3(c) for the disclosure requirements for separation and redundancy expenses. Separation and redundancy/termination benefits payments do not include any benefits that would have been accrued and payable if redundancy had not occurred (e.g. accrued leave entitlements and lump sum superannuation payments).

Agencies that make contributions to defined benefit plans but account for the plan as if it was a defined contribution plan as per FMO section 90.1, should nevertheless disclose the contributions as being made to a defined benefit plan in this note and the equivalent administered expense note.

GUIDANCE

Employee Benefits Expenses

Employee benefits expenses include employee remuneration, both monetary and non monetary, but do not include payments or reimbursements of out-of-pocket expenses.


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Reference 2010 2009$’000 $’000

Note 3B: SuppliersGoods and services

Consultants 69,859 56,877 Contractors 94,537 78,876 Stationary 485 368 Total goods and services 164,881 136,121

Goods and services are made up of:Provision of goods – related entities 4,163 1,698 Provision of goods – external parties 24,981 20,987 Rendering of services – related entities 1,392 568 Rendering of services – external parties 134,345 112,868 Total goods and services 164,881 136,121

Other supplier expensesAASB 117.35(c) Operating lease rentals – related entities:

Minimum lease payments 15,625 10,462 Workers compensation expenses 6,535 5,427 Total other supplier expenses 22,160 15,889 Total supplier expenses 187,041 152,010

Note 3C: Depreciation and AmortisationDepreciation:

Property, plant and equipment1 7,356 11,404 Buildings 1,399 1,974

Total depreciation 8,755 13,378

Amortisation:

Intangibles:Computer Software 1,490 467

Total amortisation 1,490 467 Total depreciation and amortisation 10,245 13,845

AASB 116.43-45

AASB 116.49

AASB 116.55

GUIDANCE

1. Prima Agency has equipments under finance lease arrangements worth $7,192 (2009: $10,205). Depreciation expense for the finance leases are included in the line 'Property, plant and equipment' above.

Depreciation of property, plant and equipment used for development activities may be included in the cost of an intangible asset recognised in accordance with AASB 138 Intangible Assets.

Depreciation

Each part of an item of property, plant and equipment with a cost that is significant in relation to the total cost of the item shall be depreciated separately. If the useful life and depreciation method are the same for each significant part, such parts may be grouped in determining the depreciation charge.

Depreciation of an asset ceases at the earlier of the date that the asset is classified as held for sale in accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations and the date that the asset is derecognised. In other circumstances depreciation does not cease when the asset becomes idle or is retired from active use.


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Reference Note 3D: Finance CostsLoans 276 17 Finance leases 387 155 Unwinding of discount 87 67 Total finance costs 750 239

AASB 136.126 Note 3E: Write-Down and Impairment of AssetsAsset write-downs and impairments from:

Impairment on intangible assets - 43 Other - 189

Total write-down and impairment of assets - 232

2010 2009

$’000 $’000

Note 3F: Other ExpensesAct of Grace payments 1,236 -Guarantees, undertakings and indemnities - 71 Total other expenses 1,236 71

Note 3G: Operating Expenditure for Heritage and Cultural Assets†

Operating expenditure 1,586 1,495 Total 1,586 1,495

'Collection Institutions' and 'Operating Expenditure'

GUIDANCE

Refer to Division 25 of the FMOs for guidance on Collection Institutions and Operating Expenditure items.

† Operating expenditure is contained in the statement of comprehensive income; however, it is not disclosed as a separate line item. It is merely a representation of expenditure relating to heritage and cultural assets.


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Reference Note 4: Income

2010 2009REVENUE $’000 $’000

Note 4A: Sale of Goods and Rendering of ServicesProvision of goods - related entities 13,241 11,568 Provision of goods - external parties 10,556 9,478 Rendering of services - related entities 21,952 24,986 Rendering of services - external parties 142,365 120,124 Total sale of goods and rendering of services 188,114 166,156

Related Entities

AASB 118.35(b)(iii) Note 4B: InterestDeposits - 42 Total interest - 42

AASB 118.35(b)(i,ii)

GUIDANCE

The term related entities means entities which form part of the Australian Government or which the Australian Government controls. A list of such entities is contained in the Commonwealth Government Consolidated Financial Statements (CFS) and is current at the date of preparation of the CFS.

GUIDANCE

Interest

Net gain or loss on financial assets at fair value through profit or loss (FVPL) is recognised in profit or loss; this includes any interest earned on the financial asset. Consequentially, interest earned on financial assets at FVPL is included in line item ‘Change in fair value through profit and loss’ of Note 4E and not to be included again in Note 4B.


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Reference 2010 2009$’000 $’000

GAINS

Note 4C: Sale of Assets

Land and buildings:Proceeds from sale - 2,300 Carrying value of assets sold - (1,849)

AASB 101.98(c) Property, plant and equipment:Proceeds from sale 5,580 2,150 Carrying value of assets sold (5,209) (1,846)

AASB 101.34(a) Net gain from sale of assets 371 755

AASB 101.98(a)

Note 4D: Reversals of Previous Asset Write-Downs and Impairments

Asset revaluation increment - 2,918 Reversal of impairment losses - 394 Total reversals of previous asset write-downs and impairments - 3,312

Note 4E: Other Gains

Resources received free of charge 450 429 Total other gains 450 429

AASB 101.98

AASB 101.34(a)

AASB 1004.44

● discontinued operations;

● disposals of investments;

● fair value can be reliably measured; and

Gains and losses on the disposal of non-current assets, including investments and operating assets, are reported by deducting from the proceeds on disposal the carrying amount of the asset and related selling expenses.

● other reversals of provisions.

Resources received free of charge are required to be recognised at their fair value if:

● litigation settlements; and

There is no requirement to display resources received free of charge on the face of the financial statements, however they must be disclosed on either the face of the statements or in the notes to the financial statements.

● the services would have been purchased if not received free of charge.


Resources received free of charge are recorded as revenue or gains depending on the nature of the business and the transaction (i.e. whether they are generated in the ordinary course of the entity's activities).

● write-downs of inventories to net realisable value or of property, plant and equipment to recoverable amount, as well as reversals of such write-downs;

● disposals of items of property, plant and equipment;

Disclosures

GUIDANCE

Separate disclosure of items of income and expense include:

● restructuring of the activities of an entity and reversals of any provisions for the costs of restructuring;


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Reference REVENUE FROM GOVERNMENT 2010 2009$’000 $’000

Note 4F: Revenue from GovernmentAppropriations:

Departmental outputs 151,482 106,745 Total revenue from Government 151,482 106,745

Reconciliation

The balance of unspent current year appropriations recognised in the balance sheet as at 30 June 2010 can be cross-referenced to the balance of unspent appropriations in Note 25.

GUIDANCE


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Reference

2010 2009$’000 $’000

FMO 123.1 Income Tax ExpenseCompetitive neutrality - commonwealth tax equivalent expense 5,684 17,410 Total income tax expense 5,684 17,410

GUIDANCE

The Education Services Division of the Agency provides services on a 'for-profit' basis and is subject tothe Australian Government’s Competitive Neutrality Policy. The above amounts have been calculated asbeing payable to the Australian Government in the form of company income tax under the Income TaxAssessment Acts had they applied. These amounts have been paid or were payable by the Agency to theOfficial Public Account.

Note 5: Income Tax Expense (Competitive Neutrality)

A Tax Equivalent Regime (TER) requires an entity to calculate an income tax liability in a comparable manner to its competitors. This liability must be reported in accordance with AASB 112 Income Taxes.


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Reference Note 6: Financial Assets

2010 2009$’000 $’000

AASB 107.45 Note 6A: Cash and Cash EquivalentsSpecial Accounts 3,523 3,389 Cash on hand or on deposit 3,566 2,742 Total cash and cash equivalents 7,089 6,131

Note 6B: Trade and Other ReceivablesGood and Services:

Goods and services - related entities 11,514 14,497 Total receivables for goods and services 11,514 14,497

Appropriations receivable:For existing outputs 18,850 18,790

FMO 101.10 For additional outputs 1,005 2,124 Total appropriations receivable 19,855 20,914

Other receivables:

GST receivable from the Australian Taxation Office 891 -Total other receivables 891 -Total trade and other receivables (gross) 32,260 35,411

Less impairment allowance account:Goods and services (2,301) (3,834)

Total impairment allowance account (2,301) (3,834)Total trade and other receivables (net) 29,959 31,577

Receivables are expected to be recovered in:No more than 12 months 25,764 27,914 More than 12 months 4,195 3,663

Total trade and other receivables (net) 29,959 31,577

Receivables are aged as follows:Not overdue 26,387 27,519 Overdue by:

0 to 30 days 3,332 3,658 31 to 60 days 669 1,115 61 to 90 days 759 1,265 More than 90 days 1,113 1,854

Total receivables (gross) 32,260 35,411

The impairment allowance account is aged as follows:

Overdue by:

31 to 60 days (429) (715) 61 to 90 days (759) (1,265) More than 90 days (1,113) (1,854)

Total impairment allowance account (2,301) (3,834)


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Reference Reconciliation of the Impairment Allowance Account:

Movements in relation to 2010AASB 7.16 Goods and

services Total$'000 $'000

Opening balance (3,834) (3,834)

Amounts recovered and reversed 1,533 1,533 Closing balance (2,301) (2,301)

Movements in relation to 2009Goods and

services Total$'000 $'000

Opening balance (3,645) (3,645)Amounts written off (189) (189)

Closing balance (3,834) (3,834)

AASB 101.61

Int 1031.8

Int 1031.9 The net amount of GST recoverable from, or payable to, the taxation authority shall be included as part of receivables or payables on the Balance Sheet.

Where there is an impairment allowance account in respect of one class of receivables, the tables for 2010 and 2009 may be combined to simplify presentation.

GUIDANCE

Disclosure

For each asset and liability line item that combines amounts expected to be recovered or settled no more than twelve months after the reporting date, and more than twelve months after the reporting date, an entity shall disclose separately the amount expected to be recovered or settled after more than twelve months.

Receivables and Payables

Receivables and payables shall be stated with the amount of GST included.


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Reference Note 7: Non-Financial Assets

2010 2009$’000 $’000

Note 7A: Land and BuildingsAASB 116.31 Land at fair value 110,825 131,021

Buildings on freehold land:AASB 116.74(b) Work in progress 1,325 9,442

Fair value 41,066 40,948 Accumulated depreciation - (16,123)

Total buildings on freehold land 153,216 165,288

Leasehold improvements:Fair value 21,077 23,133 Accumulated depreciation - (10,499)

Total leasehold improvements 21,077 12,634 Total land and buildings 174,293 177,922

No land or buildings are expected to be sold or disposed of within the next 12 months.

Note 7B: Property, Plant and EquipmentAASB 116.31 Heritage and cultural:

Artwork 10,550 -Total heritage and cultural 10,550 -

Other property, plant and equipment:Fair value 59,050 63,236 Accumulated depreciation (19,980) (26,651)

Total other property, plant and equipment 39,070 36,585 Total property, plant and equipment 49,620 36,585

AASB 116.31

AASB 116.77

No indicators of impairment were found for property, plant and equipment.

A revaluation decrement of $20,196,000 for land (2009: $0) and an increment of $8,502,000 for buildings on freehold land (2009: an increment of $2,200,000), $9,464,000 for leasehold improvements (2009: an increment of $2,297,000) and $4,097,000 for plant and equipment (2009: a decrement of $500,000) were credited to the asset revaluation reserve by asset class and included in the equity section of the balance sheet.

No property, plant or equipment is expected to be sold or disposed of within the next 12 months.

Plant and equipment under finance leases were subject to revaluation. The carrying amount is included in the valuation figures above.

All revaluations were conducted in accordance with the revaluation policy stated at Note 1. On 30 June 2010,an independent valuer conducted the revaluations.

No indicators of impairment were found for land and buildings.

$2,000,000 (2009: $2,000,000) of total leasehold improvements refers to special purpose buildings, which, may not be disposed of without prior Ministerial approval.


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Reference

AASB 116.73(e)

Land BuildingsTotal land and

buildingsHeritage and

cultural*

Other property, plant

& equipment Total$’000 $’000 $’000 $’000 $’000 $’000

As at 1 July 2009

Gross book value 131,021 48,875 179,896 - 48,178 228,074 Accumulated depreciation and impairment - (1,974) (1,974) - (11,404) (13,378)Accumulated impairment losses - - - - (189) (189)Net book value 1 July 2009 131,021 46,901 177,922 - 36,585 214,507

AASB 116.73(e)(i) Additions:By purchase - - - 10,550 10,953 21,503

AASB 116.73(e)(iv) Revaluations and impairments recognised in other comprehensive income (20,196) 17,966 (2,230) - 4,097 1,867 AASB 116.73(e)(v) Impairments recognised in the operating result - - - - - -AASB 116.73(e)(vi) Reversal of impairments recognised in the operating result - - - - - -AASB 116.73(e)(vii) Depreciation expense - (1,399) (1,399) - (7,356) (8,755)

Disposals:Other - - - - (5,209) (5,209)

Net book value 30 June 2010 110,825 63,468 174,293 10,550 39,070 223,913

Net book value as of 30 June 2010 represented by:Gross book value 110,825 64,867 175,692 10,550 46,426 232,668 Accumulated depreciation - (1,399) (1,399) - (7,356) (8,755)Accumulated impairment losses - - - - - -

110,825 63,468 174,293 10,550 39,070 223,913

Note 7C: Reconciliation of the Opening and Closing Balances of Property, Property, Plant and Equipment (2009-10)

* Where land, buildings and other property, plant and equipment meet the definition of a heritage and cultural item, they must be disclosed in the heritage and cultural asset class.


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Reference

AASB 116.73(e)

Land BuildingsTotal land and

buildingsHeritage and

cultural*


equipment Total$’000 $’000 $’000 $’000 $’000 $’000

As at 1 July 2008Gross book value 132,870 66,526 199,396 - 62,459 261,855 Accumulated depreciation and impairment - (24,648) (24,648) - (15,247) (39,895)Accumulated impairment losses - - - - - -Net book value 1 July 2008 132,870 41,878 174,748 - 47,212 221,960

AASB 116.73(e)(i) Additions:By purchase - 2,500 2,500 - - 2,500

AASB 116.73(e)(iv) Revaluations and impairments recognised in other comprehensive income - 4,497 4,497 - (500) 3,997 AASB 116.73(e)(v) Impairments recognised in the operating result - - - - (189) (189)AASB 116.73(e)(vi) Reversal of impairments recognised in the operating result - - - - 3,312 3,312 AASB 116.73(e)(vii) Depreciation expense - (1,974) (1,974) - (11,404) (13,378)

Disposals:From disposal of entities or operations (including restructuring) (1,849) - (1,849) - - (1,849)Other - - - - (1,846) (1,846)

Net book value 30 June 2009 131,021 46,901 177,922 - 36,585 214,507

Net book value as of 30 June 2009 represented by:Gross book value 131,021 48,875 179,896 - 48,178 228,074 Accumulated depreciation - (1,974) (1,974) - (11,404) (13,378)Accumulated impairment losses - - - - (189) (189)

131,021 46,901 177,922 - 36,585 214,507

Note 7C (Cont'd): Reconciliation of the Opening and Closing Balances of Property, Property, Plant and Equipment (2008-09)

* Where land, buildings and other property, plant and equipment meet the definition of a heritage and cultural item, they must be disclosed in the heritage and cultural asset class.


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Reference

AASB 116.73

other disposals;

AASB 116.74(a)-(d) The financial statements must also disclose:

AASB 101.29

AASB 116.77

Measurement

AASB 116.31

• the existence and amounts of restrictions on title, and property, plant and equipment pledged as security for liabilities;

• if not disclosed separately on the face of the statement of comprehensive income, the amount of compensation from third parties for items of property, plant and equipment that were impaired, lost or given up that is included in profit or loss.

• the methods and significant assumptions applied in estimating the items' fair values (see paragraph 1.19 in Note 1) ;

Refer to FMO section 33.4 for the measurement basis for Specialist Military Equipment.

• other changes.

• the amount of contractual commitments for the acquisition of property, plant and equipment (see Schedule of Commitments) ; and

• the amount of expenditures recognised in the carrying amount of an item of property, plant and equipment in the course of its construction;

• increases or decreases resulting from revaluations under paragraphs 31, 39, Aus39.1, 40, Aus40.1 and Aus40.2 of AASB 116 Property, Plant and Equipment and from impairment losses recognised or reversed in other comprehensive income in accordance with AASB 136 Impairment of Assets ;

• depreciation;

• the net exchange rate difference when converting the financial statements from the operating currency to the Australian dollar; and

The financial statements shall disclose, for each class of property, plant and equipment:

accordance with AASB 5 Non-current Assets Held for Sale and Discontinued Operations and

• the measurement bases used for determining the gross carrying amount (see paragraph 1.19 in Note 1) ;

Disclosure

• a reconciliation of the carrying amount at the beginning and end of the period showing:

• additions;

GUIDANCE

• the depreciation methods used (see paragraph 1.19 in Note 1) ;

• the useful lives or the depreciation rates used (see paragraph 1.19 in Note 1) ;

• assets classified as held for sale or included in a disposal group classified as held for sale in

• the gross carrying amount and the accumulated depreciation (aggregated with accumulated impairment losses) at the beginning and end of the period; and

An entity shall present separately each material class of similar items. An entity shall present separately items of a dissimilar nature or function unless they are immaterial.

The use of up-to-date fair values means that valuation must be made with sufficient regularity to ensure that the carrying amount of each asset in a class does not differ materially from its fair value at each reporting date.

If items of property, plant and equipment are stated at revalued amounts, the following must be disclosed:

• the effective date of the revaluation;

• the extent to which the items’ fair values were determined directly by reference to observable prices in an active market or recent market transactions on arm’s length terms or were estimated using other valuation techniques; and

• the revaluation reserve, indicating the change for the period and any restrictions on the distribution of the balance to shareholders.

• whether an independent valuer was involved;


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Reference 2010 2009$’000 $’000

Note 7D: IntangiblesComputer software:

Internally developed – in progress - 500 Internally developed – in use 10,116 4,480

Total computer software (gross) 10,116 4,980 Accumulated amortisation (4,806) (3,316)Accumulated impairment losses (43) (43)

Total computer software (net) 5,267 1,621 Total intangibles 5,267 1,621

Note 7E: Reconciliation of the Opening and Closing Balances of Intangibles (2009-10)

AASB 138.118(e) Computer software

internally developed Total

$’000 $’000As at 1 July 2009Gross book value 4,980 4,980 Accumulated amortisation and impairment (3,359) (3,359)Net book value 1 July 2009 1,621 1,621

AASB 138.118(e)(i) Additions:By purchase 5,136 5,136

AASB 138.118(e)(iv) Impairments recognised in the operating result - -AASB 138.118(e)(vi) Amortisation (1,490) (1,490)

Net book value 30 June 2010 5,267 5,267

Net book value as of 30 June 2010 represented by:Gross book value 10,116 10,116 Accumulated amortisation and impairment (4,849) (4,849)

5,267 5,267

Note 7E (Cont'd): Reconciliation of the Opening and Closing Balances of Intangibles (2008-09)

AASB 138.118(e) Computer software

internally developed Total

$’000 $’000As at 1 July 2008Gross book value 3,880 3,880 Accumulated amortisation and impairment (2,849) (2,849)Net book value 1 July 2008 1,031 1,031

AASB 138.118(e)(i) Additions:By purchase 1,100 1,100

AASB 138.118(e)(iv) Impairments recognised in the operating result (43) (43)AASB 138.118(e)(vi) Amortisation (467) (467)

Net book value 30 June 2009 1,621 1,621

Net book value as of 30 June 2009 represented by:Gross book value 4,980 4,980 Accumulated amortisation and impairment (3,359) (3,359)

1,621 1,621

No indicators of impairment were found for intangible assets.

No intangibles are expected to be sold or disposed of within the next 12 months.


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Reference GUIDANCE

Recognition and DisclosureAASB 138.21

AASB 138.54 and 126-127

AASB 138.63

Amortisation and Valuation

AASB 138.74-75

AASB 138.97

AASB 138.107-108

AASB 138.104

AASB 138.117

FMO 35.1

AASB 138.52

An intangible asset is to be recognised as an asset only when:

• it is probable that the future economic benefits that are attributable to the asset will flow to the entity; and

Internally generated brands, mastheads, publishing titles, customer lists and items similar in substance are not recognised as intangible assets.

Expenditure on research (or on the research phase of an internal project) is recognised as an expense when it is incurred. Disclosure is required of the aggregate amount of research and development expenditure recognised as an expense in the reporting period.

An intangible asset with a finite useful life is to be amortised over its useful life (and is also subject to impairment testing).

The amortisation period for intangible assets must be reviewed at least annually and changed if significantly different to previous estimates.

Intangibles from Development

• the cost of the asset can be reliably measured.

Amortisation ceases at the earlier of the date that the intangible asset is classified as held for sale or fully amortised.

FMO 35.1 requires that sufficient information and subtotal columns must be disclosed to enable reconciliation of amounts to the corresponding line items disclosed on the balance sheet. Additional classes of intangibles are patents, trademarks, brand names and licences and goodwill.

Intangible assets with an indefinite useful life are not to be amortised. In accordance with AASB 136 Impairment of Assets , an entity is required to test an intangible asset with an indefinite useful life for impairment by comparing its recoverable amount with its carrying amount:

Refer to FMO section 33.2 for the measurement basis for non-financial assets subsequent to initial recognition.

In the absence of an active market the cost basis must be applied to intangible assets, less any accumulated amortisation and any accumulated impairment losses. Intangibles are carried at fair value less any accumulated amortisation and any accumulated impairment losses where an active market exists.

(a) annually, and

An intangible asset arising from development (or from the development phase of an internal project) is recognised if the criteria in AASB 138 Intangible Assets paragraph 57 to 64 are met.

(b) whenever there is an indication that the intangible asset may be impaired.


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Reference 2010 2009$’000 $’000

Note 7F: InventoriesInventories held for sale:

AASB 102.36(b) Work in progress 895 1,332 AASB 102.36(b) Finished goods 3,502 319

Total inventories held for sale 4,397 1,651 Inventories held for distribution 1,505 252 Total inventories 5,902 1,903

AASB 102.36(d)

AASB 102.36(c) No items of inventory were recognised at fair value less cost to sell.

AASB 102.25

AASB 102.Aus9.1

Note 7G: Other Non-Financial AssetsPrepayments 3,650 1,764

Total other non-financial assets 3,650 1,764

Total other non-financial assets - are expected to be recovered in:

No more than 12 months 3,650 1,764 Total other non-financial assets 3,650 1,764

AASB 102.Aus9.1

AASB 102.Aus36.1(c) During 2009-10, $12,124 of inventory held for distribution was recognised as an expense (2008-09: nil)

During 2009-10, $29,144 of inventory held for sale was recognised as an expense (2008-09: $22,285).

No indicators of impairment were found for other non-financial assets.

• the carrying amount of inventories pledged as security for liabilities; and

• the circumstances or events that led to the reversal of write-downs of inventories;

AASB 102.36 and .Aus36.1

Additional disclosures required by AASB 102 include:

• the carrying amount of inventories in classifications appropriate to the entity;

• the amount of inventories recognised as an expense during the period.

AASB 102.Aus10.1

Separate disclosure is required for:

Agencies are required to apply the same cost formula to all inventories of the same nature or use. Where they are not of the same nature or use, then differing cost methods may be applied.

GUIDANCE

Measurement and Disclosure

• inventories held for distribution.

All inventory is expected to be sold or distributed in the next 12 months.

• inventories held for sale; and

• the amount of any reversal of any write-downs recognised as a reduction of an expense;

• the amount of any write-downs and other losses recognised as an expense;

Inventory held for distribution by not-for-profit entities is to be measured at cost less any loss of service potential.

For not-for-profit entities, where inventories are acquired at no cost, or for nominal consideration, the cost shall be the current replacement cost as at the date of acquisition.


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Reference Note 8: Payables

2010 2009$’000 $’000

Note 8A: SuppliersTrade creditors and accruals 20,523 25,774 Operating lease rentals 564 3,273 Total supplier payables 21,087 29,047

AASB 101.61 Supplier payables expected to be settled within 12 months:Related entities 21,087 28,205

Total 21,087 28,205

Supplier payables expected to be settled in greater than 12 months:Related entities - 842

Total - 842 Total supplier payables 21,087 29,047

Supplier PayablesInt 1031.8

Note 8B: Other PayablesSalaries and wages 1,100 6,114 Superannuation 1,202 2,351 Separations and redundancies 358 184 Prepayments received/unearned income - 731 GST payable to ATO - 1,510 Other 10,268 1,250 Total other payables 12,928 12,140

AASB 101.61 Total other payables are expected to be settled in:

No more than 12 months 11,050 10,475 More than 12 months 1,878 1,665

Total other payables 12,928 12,140

Separations and Redundancies

GUIDANCE

Payables to suppliers include GST payable.

Settlement is usually made within 30 days.

AASB 119 paragraph 133 requires separations and redundancies to be recorded as a liability once an entity is demonstrably committed to offer voluntary redundancies or terminate employees’ employment. Once employees have either accepted a voluntary redundancy or the specific employees to be terminated is known, separations and redundancies should be recognised as a payable rather than a provision.

GUIDANCE


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Reference Note 9: Interest Bearing Liabilities

2010 2009$’000 $’000

Note 9A: LoansLoans from Government i 3,327 4,592 Total loans 3,327 4,592

Payable:Within one year 1,265 1,265 In one to five years 2,062 3,327

Total loans 3,327 4,592

AASB 7.7 Loan information

There were no loan payable default during the period.

Note 9B: LeasesAASB 117.31(a) Finance leases 7,192 10,205

Total finance leases 7,192 10,205

Payable:Within one year:

Minimum lease payments 3,400 3,400 Deduct: future finance charges (312) (387)

In one to five years:Minimum lease payments 4,634 8,034 Deduct: future finance charges (530) (842)

Finance leases recognised on the balance sheet 7,192 10,205

AASB 117.31

Note 9C: Other Interest Bearing LiabilitiesOther i 2,058 2,363 Total other interest bearing liabilities 2,058 2,363

AASB 101.61 Other interest bearing liabilities are expected to be settled in:

No more than 12 months 2,058 2,363 Total other interest bearing liabilities 2,058 2,363

AASB 7.7 Details of Interest Bearing Liabilities

i. The loan was issued in 1 July 2008 and is repayable in annual instalments from 30 June 2009 and ending in 2011-2012. The interest rate implicit in the loan is 9.85%.

i. The agency has received incentives in the form of rent free periods on entering property operating leases.

Finance leases exist in relation to certain major office equipment assets. The leases were non-cancellable and for fixed terms averaging 3 years, with a maximum of 5 years. The interest rate implicit in the leases averaged 11% (2009:11%). The lease assets secure the lease liabilities. PRIMA Agency guarantees the residual values of all assets leased. There are no contingent rentals.


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Reference

Recognition of Finance LeasesAASB 117.20

Measurement and DisclosureAASB 117.25

AASB 117.31(d)

AASB 101.61

Int 4

AASB 117.35

Operating Leases –IncentivesInt 115.4-5 In Interpretation 115 Operating Leases –Incentives , lessors and lessees are required to recognise lease

incentives under operating leases as a reduction of rental income or rental expense, respectively, over the lease term. The calculation is required to be on a straight-line basis unless another systematic basis is representative of the time pattern of the benefits of the leased asset to the lessee.

Minimum lease payments shall be apportioned between the finance charge and the reduction of the outstanding liability and shall be disclosed separately.

For non-cancellable sub-leases, the total of future minimum lease payments expected to be received as at the reporting date must also be disclosed.

For each asset and liability line item that combines amounts expected to be recovered or settled no more than twelve months after the reporting date, and more than twelve months after the reporting date, an entity shall disclose separately the amount expected to be recovered or settled after more than twelve months.

The requirements of AASB 7 Financial Instruments: Disclosures applies to finance leases.

Interpretation 4 Determining Whether an Arrangement Contains a Lease specifies criteria for determining whether an arrangement is, or contains, a lease. The determination is based on an assessment of whether fulfilment of the arrangement is dependent on the use of a specific asset and whether the arrangement conveys a right to use the asset. If an arrangement contains such a right then AASB 117 Leases is applied.

Refer to paragraph 35 of AASB 117 for additional disclosure requirements for operating leases, in addition to the requirements of AASB 7.

GUIDANCE

At the commencement of the lease term, lessees shall recognise finance leases as assets and liabilities on the balance sheet at amounts equal to the fair value of the leased property or, if lower, the present value of the minimum lease payments (the discount rate applicable is the interest rate implicit in the lease, if practicable; if not, the lessee’s incremental borrowing rate).


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Reference Note 10: Provisions

2010 2009$’000 $’000

Note 10A: Employee ProvisionsLeave 50,795 45,347 Other 163 651 Total employee provisions 50,958 45,998

AASB 101.61 Employee provisions are expected to be settled in:No more than 12 months 35,720 32,394 More than 12 months 15,238 13,604

Total employee provisions 50,958 45,998

GUIDANCE

AASB 119.10-13

AASB 119.10-13

AASB 119.11(b)

AASB 119.13

AASB 101.61

Measurement AASB 119.9

AASB 119.10

An entity shall disclose the amount expected to be recovered or settled after more than twelve months for each asset and liability line item that combines amounts expected to be recovered or settled:

Accumulating non-vested benefits dependent on a specified length of service being reached, to the extent that it is probable it will result in vested benefits in the future, are recognised as a liability in the financial statements (e.g. a provision for long service leave is calculated based on actuarial analysis of employee retention and leave claim patterns).

Associated costs of employment such as workers’ compensation insurance must be recognised as liabilities and expenses when the employee benefit expenses are recognised. These must not be treated as employee benefit liabilities.

• an associated liability to the extent that any amount of employee benefit remains unpaid to the employee.

Financial Statement Presentation and Disclosure

Non-vested employee benefits (when employees are not entitled to a cash payment for unused entitlement on leaving) are recognised when a valid claim is made, e.g. claim for sick leave.

(a) no more than twelve months after the reporting period, and (b) more than twelve months after the reporting period.

Vested employee benefits (when employees are entitled to a cash payment for unused entitlement on leaving the entity such as annual leave) are recognised as follows:

• the amount of the associated employee benefit cost as an expense unless the cost is included in the cost of another asset such as inventories or property, plant and equipment; and

POLICY

AASB 119 Employee Benefits requires an entity to recognise a liability when an employee has provided service in exchange for employee benefits to be paid in the future.

Entities must recognise both legal and constructive obligations for employee benefits.

Recognition

Recognition

All short-term employee and termination benefits that the employee is entitled to within 12 months of reporting date are measured at nominal amounts with all other benefits discounted to present value. This measurement takes account of legal and constructive obligations to employees.

Entities must recognise the undiscounted amount of short-term employee benefits expected to be paid in exchange for services as an expense (unless another accounting standard requires or permits the inclusion of the benefits in the cost of an asset) and liability.

Refer to FMO section 43.2 and 43.3 for eligibility criteria in relation to the shorthand method of calculating long service leave provisions.


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Reference

AASB 119.116

AASB 119.133

AASB 119.134

AASB 137.5(d)

2010 2009$’000 $’000

Note 10B: Other ProvisionsProvision for guarantee - 71 Provision for restoration obligations 3,523 3,365 Total other provisions 3,523 3,436

AASB 101.61 Other provisions are expected to be settled in:More than 12 months 3,523 3,436

Total other provisions 3,523 3,436

Provision for guarantee

Provision for restoration Total

$’000 $’000 $’000AASB 137.84(a) Carrying amount 1 July 2009 71 3,365 3,436 AASB 137.84(b) Additional provisions made - 71 71 AASB 137.84(c) Amounts used (71) - (71)AASB 137.84(e) Unwinding of discount or change in discount rate - 87 87 AASB 137.84(a) Closing balance 2010 - 3,523 3,523

AASB 137.85

Separation and Redundancy (Termination Benefits)

The Agency’s Educational Services Business Operation provided a guarantee in 2002 in respect ofborrowings by one of its service providers. This guarantee was called during the year.

The Agency currently has 13 agreements for the leasing of premises which have provisions requiring theAgency to restore the premises to their original condition at the conclusion of the lease. The Agency hasmade a provision to reflect the present value of this obligation.

• the termination benefits for each job classification or function; and

Provisions (Employee Benefits)

The plan must at least identify:

• when the terminations will occur.

An entity is presently obliged to provide termination benefits when, and only when, the entity has developed a detailed formal plan for the terminations and raised a valid expectation in those employees, except on acquisition of an entity or operation.

• the location, function, and approximate number of employees who will be compensated for terminating their services;

An asset related to one plan cannot be offset against a liability related to a separate plan unless there is a legally enforceable right to use a surplus in one plan to settle obligations under the other plan.

Disclosure and Classification - Superannuation Plan

AASB 137 Provisions, Contingent Liabilities and Contingent Assets refers the reader to AASB 119 when dealing with provisions for employee benefits.

AASB 119 prescribes the accounting treatment for employee benefits which encompass all forms of consideration provided by an employer to employees in exchange for services rendered by employees.


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Reference

Restoration ObligationsInt 1.8

AASB 137.14

AASB 137.36-52

AASB 137.59-60

AASB 137.85

AASB 137.84

A provision is recognised when all of the following conditions are met:

GUIDANCE

Recognition

The movement schedule required by AASB 137 paragraph 84 does not require comparative information to be displayed.

Disclosure

Initial measurement requires a provision to:

Initial Measurement

Subsequent Measurement

● be measured at the best estimate of the expenditure required to settle the present obligation at the reporting date, and further requires that this amount take into account risks and uncertainties;

Where the effect of the time value of money is material, the amount of a provision shall be the present value of the expenditures expected to be required to settle the obligation.

Provisions are to be reviewed at each reporting date and adjusted to reflect the current best estimate.

● take into account eventual costs of disposal of assets (e.g. make-good); and

● it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation; and

Entities must disclose particulars regarding the movement on each class of provision and a description of each class.

● not take into account the gains from the expected disposal of assets.

● take into account future events that may affect the amount required to settle the present obligation where there is sufficient objective evidence that the future events will occur;

● a reliable estimate can be made of the amount of the obligation.

● be discounted to its present value when the effect of the time value of money is material;

● an entity has a present obligation (legal or constructive) as a result of a past event;

The periodic unwinding of the discount shall be recognised in profit or loss as a finance cost as it occurs.


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Reference

2009$’000

FMO 92.2

AASB 1004.58 Department of GoodwillAssets recognised

Prepayments 700 Trade debtors 900

Total assets recognised 1,600 Liabilities recognised

Trade creditors (167)Total liabilities recognised (167)Net assets assumed 1,433

Net assets assumed from all entities 1,433

Community Support ProgramIncome Recognised by the PRIMA Agency 1,250 Recognised by Department of Goodwill 17,090 Total Income 18,340

AASB 1004.57 ExpensesRecognised by the PRIMA Agency 2,356 Recognised by Department of Goodwill 21,192 Total Expenses 23,548

Note 11: Restructuring

In respect of functions assumed, the net book values of assets and liabilities transferred to the Agency for no consideration and recognised as at the date of transfer were:

Note 11A: Departmental Restructuring

As a result of a restructuring of administrative arrangements, the Agency assumed responsibility for the following functions:

There were no restructures in 2009-10.

• Community Support policy formulation on 26 November 2008.

FMO 92.1

Income and expenses for the functions assumed by the Agency were as follows:


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2009

$’000

AASB 1004.58 Department of GoodwillAssets relinquished

Trade debtors (1,000)Total assets relinquished (1,000)Net liabilities relinquished (1,000)

Net liabilities relinquished from all entities (1,000)

Note 11B: Administered RestructuringReference

As a result of a restructuring of administrative arrangements, the Agency relinquished responsibility for the following functions:

In respect of functions relinquished, the following assets and liabilities were transferred by the Agency:

• Training and Employment Support sub-program AA.


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Reference

Measurement and Disclosure

AASB 116.Aus15.1

Prior Year Disclosure

Assumed Functions - Disclosure of Income and ExpensesAASB 1004.57

Int 1038.7&8

The meaning of 'function' is not defined. Agencies are to exercise judgement as to the appropriate level of disclosure in relation to restructures.

For not-for-profit entities, where an asset is acquired at no cost, or for a nominal cost, the cost is its fair value as at the date of acquisition.

The restructure note should not contain any comparative figures unless a single restructure occurred over two consecutive financial years.

The notes must disclose the full annual expense/income of the functions, which have been transferred to the entity. The statement of comprehensive income recognises only those expense/income incurred/earned whilst the functions were under the control of the reporting entity.

The transfer of assets and liabilities between agencies as a result of a restructuring of administrative arrangements is designated as an owner transaction.

A transfer for no consideration to a wholly owned public sector entity must be recognised by the transferee as a contribution by owners when, and only when, it satisfies the definition of contributions by owners in AASB 1004 Contributions. The transfer is a contribution by owners where its equity nature is evidenced by formal designation of the transfer (or a class of such transfers) by the parent entity of the transferor as forming part of the transferee’s capital (either before the transfer occurs or at the time of the transfer).

GUIDANCE


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Reference Note 12: Cash Flow Reconciliation

2010 2009$’000 $’000

AASB 107.45 Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement

Cash and cash equivalents as per:Cash flow statement 7,089 6,131 Balance sheet 7,089 6,131 Difference - -

Reconciliation of net cost of services to net cash from operating activities:

Net cost of services 123,680 80,282 Add revenue from Government 151,482 106,745 Less income tax expense (5,684) (17,410)

Adjustments for non-cash itemsDepreciation / amortisation 10,245 13,845 Net write down of non-financial assets - -Gain on disposal of assets (371) (755)Resources received free of charge - goods (450) (429)Deterioration of financial condition of guarantee during period - 71

Changes in assets / liabilitiesDecrease in net receivables 1,618 (23,496)Increase in inventories (3,999) 1,911 Increase in prepayments (1,886) 1,504 Increase in employee provisions 4,960 10,061 Decrease in supplier payables (7,960) (4,492)Increase in other payable 788 12,140 Increase in other provisions 87 3,365 Net cash from operating activities 272,510 183,342

AASB 107.Aus20.2


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Reference

Disclosure

AASB 107.43, 44

AASB 107.48

AASB 107.45

AASB 107.50


from those cash flows that are required to maintain operating capacity.

For the purpose of the cash flow reconciliation, resources received free of charge refers only to goods received free of charge. Service received free of charge would give rise to equal amounts of expense and revenue, so would not be a reconciling item.

• a transfer of assets as a result of restructuring.

Details of transactions, which do not result in cash flows but affect assets and liabilities, must be disclosed. Examples of non-cash financing and investing transactions and other events include:

Where the related item in the balance sheet is cash and its amount equals the amount in the statement of cash flows in both the current and immediately preceding reporting periods, no reconciliation is needed.

• conversions of liabilities to equity;

• the aggregate amount of cash flows that represent increases in operating capacity separately

• the amount of undrawn borrowing facilities that may be available for future operating

The amount of significant cash and cash equivalents held by the entity that are not available for use by the group (parent and other subsidiaries) are to be disclosed, together with explanatory commentary by management on restrictions of use.

activities and to settle capital commitments, indicating any restrictions on the use of these facilities; and

GUIDANCE

Disclosure of additional information that may be relevant to users in understanding the financial position and liquidity of an entity, together with a commentary by management, is encouraged and may include:

Reconciliation is required of the amount of cash in the cash flow statement at the end of the reporting period to the related item(s) in the balance sheet.

• acquisitions of entities by means of an equity issue;

• acquisitions of assets by assumption of directly related liabilities, such as a purchase of a building by incurring a mortgage to the seller;

• acquisitions of assets by entering into finance leases;

• exchanges of non-cash assets or liabilities for other non-cash assets or liabilities; and


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Reference Note 13: Contingent Liabilities and Assets

FMO 80

2010 2009 2010 2009 2010 2009$’000 $’000 $’000 $’000 $’000 $’000

Contingent assetsBalance from previous period - 71 150 - 150 71 New - - - 150 - 150 Assets recognised - (71) (35) - (35) (71)Total contingent assets - - 115 150 115 150

Contingent liabilitiesBalance from previous period - - 13 13 13 13 Total contingent liabilities - - 13 13 13 13 Net contingent assets 102 137

Guarantees

AASB 137.86-92 Claims for damages or costs Total


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Reference Quantifiable Contingencies

Unquantifiable Contingencies

Significant Remote Contingencies

DisclosureAASB 137.86

AASB 137.89

Significant Remote Contingencies

Information regarding significant remote contingencies is in addition to the information required under AASB 137.

Where an inflow of economic benefits is probable, an entity shall disclose a brief description of the nature of the contingent assets at the reporting date and, where practicable, an estimate of their financial effect, measured using the principles set out for provisions in AASB 137 paragraphs 36-52.

• the possibility of any reimbursement.

• an indication of the uncertainties relating to the amount or timing of any outflow; and

The Schedule of Contingencies reports contingent asset in respect of claims for damages/costs of $115,000 (2009:$150,000). The Agency is expecting to succeed in claims against suppliers, although the cases are continuing. Theestimate is based on precedent in such cases.

Unless the possibility of any outflow in settlement is remote, an entity shall disclose for each class of contingent liability at the reporting date a brief description of the nature of the contingent liability and, where practicable:

• an estimate of its financial effect, measured under AASB 137 Provisions, Contingent Liabilities and Contingent Assets paragraphs 36-52;

GUIDANCE

The Schedule also reports contingent liabilities in respect of claims for damages/costs of $13,000 (2009: $13,000). The amount represents an estimate of the Agency’s liability based on precedent cases. The Agency is defending the claims.

The Agency’s Education Services Business Operation has had a past practice of meeting some of the debts of service providers who are entering into voluntary administration so that the provision of services can continue in the short-term. As of 10 May 2010, a service provider's financial position had deteriorated and administration was likely. It is not possible to estimate the amounts of any eventual payments that may be required in relation to this provider.

The Agency has no significant remote contingency.

At 30 June 2010, the Agency had a number of legal claims against it for alleged harassment in the workplace. The Agency has denied liability and is defending the claims. It is not possible to estimate the amounts of any eventual payments that may be required in relation to these claims.


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Reference Note 14: Senior Executive Remuneration

Note 14A: Actual Remuneration Paid to Senior ExecutivesFMO 23.3

Executive Remuneration2010 2009

The number of senior executives who received:

less than $145,000* 1 -$145,000 to $159,999 3 3 $160,000 to $174,999 2 2 $205,000 to $219,999 1 1

Total 7 6

* Excluding acting arrangements and part-year service.

$ $Short-term employee benefits:

Salary (including annual leave taken) 885,844 798,245 Changes in annual leave provisions 68,142 74,562 Performance bonus 44,294 32,987

Other1 101,471 97,144 Total Short-term employee benefits 1,099,751 1,002,938 Superannuation (post-employment benefits) 132,877 113,852 Other long-term benefits 21,843 15,463 Total 1,254,471 1,132,253

Notes1. "Other" includes motor vehicle allowances and other allowances.

GUIDANCE

Minumum Threshold

The minimum senior executives' remuneration threshold has been removed.

Total expense recognised in relation to Senior Executive employment

During the year the entity paid $345,085 in termination benefits to senior executives (2009: $285,478)


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Reference Note 14B: Salary Packages for Senior Executives as at 30 June

As at 30 June 2010 As at 30 June 2009

No. SES No. SES

Base salary (including annual leave)

Total remuneration

package1

Total remuneration*:

$145,000 to $159,999 - 3 116,852 152,000 $160,000 to $174,999 3 2 121,058 173,000 $175,000 to $189,999 2 - - -$190,000 to $204,999 - 1 134,845 204,000 $205,000 to $219,999 1 - - -

Total 6 6 * Excluding acting arrangements and part-year service.

Notes

1. Non-Salary elements available to Senior Executives include:

(a) Performance Bonus

(b) Motor vehicle allowance

(c) Superannuation

GUIDANCE

Additional Disclosures

-

Agencies may add additional disclosure to identify reasons for differences between figures in Note 14A and Note 14B.

123,659

-

Average annualised remuneration packages for substantive Senior Executives

Base salary (including

annual leave)

146,745 219,000

170,000

185,000

-

-

119,927

Total remuneration

package1


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Reference Note 15: Remuneration of Auditors

2010 2009$’000 $’000

FMO 24 Financial statement audit services were provided free of charge to the Agency.

The fair value of the services provided was:PRIMA Agency 373 359 Education Services Business Operation 77 70

450 429

GUIDANCE

DisclosureFMO 12.51P Section 12.51P of the FMOs requires disclosures to be made in accordance with this Schedule

regardless of whether the relevant amounts are considered to be immaterial.

No other services were provided by the auditors of the financial statements.


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Reference

2010 2009$'000 $'000

AASB 7.8 Note 16A: Categories of Financial InstrumentsFinancial AssetsLoans and receivables:

Cash and cash equivalents 7,089 6,131 Trade receivables 11,514 14,497

Total 18,603 20,628 Carrying amount of financial assets 18,603 20,628

Financial LiabilitiesAt amortised cost:

Loans from Government 3,327 4,592 Finance leases 7,192 10,205 Other interest bearing liabilities 2,058 2,363 Trade creditors 21,087 29,047 Financial guarantee - 71 Other 10,268 1,250

Total 43,932 47,528 Carrying amount of financial liabilities 43,932 47,528

DisclosureAASB 7.8

Treatment of GST

Note 16B: Net Income and Expense from Financial AssetsLoans and receivablesInterest revenue - 42

AASB 7.20(a)(iv) Net gain loans and receivables - 42 Net gain from financial assets - 42

AASB 7.20(b)

Note 16: Financial Instruments

The description of items should be consistent with those included in notes 6, 8 and 9:.

AASB 7 requires disclosure of the carrying amounts of categories of financial assets and liabilities. The standard allows face statement presentation or disclosure in the notes. PRIMA has adopted the approach to include all financial instruments in the notes.

Receivables and payables should be presented on a GST inclusive basis in the financial instruments note.

GST receivable directly from or payable directly to the ATO in its role as tax collector (e.g. with the periodic Business Activity Statement) is not a financial instrument.

GUIDANCE

There is no interest income from financial assets not at fair value through profit or loss in the year ending 2010. The total interest expense from financial liabilities not at fair value through profit or loss was $42,000 for 2009.


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Reference 2010 2009$'000 $'000

Note 16C: Net Income and Expense from Financial LiabilitiesFinancial liabilities - at amortised cost

Interest expense 1,883 687 AASB 7.20(a)(v) Net gain financial liabilities - at amortised cost 1,883 687

Net gain from financial liabilities 1,883 687

AASB 7.20(b)

Note 16D: Fair Value of Financial Instruments

AASB 7.25 Carrying Fair Carrying Fairamount value amount value

2010 2010 2009 2009$'000 $'000 $'000 $'000

Financial LiabilitiesOther Liabilities:

Loans from Government1 3,327 4,592 4,868 Total 3,327 4,592 4,868

AASB 7.27

OffsettingAASB 7.26

AASB 7.29-30 Fair Value

c) for a contract containing a discretionary participation feature (as described in AASB 4 Insurance Contracts ) if the fair value of that feature cannot be measured reliably.

The total interest expense from financial liabilities not at fair value through profit or loss is $1,883,000 ($687,000 for 2009).

3,526 3,526

Where an entity does not disclose fair value, they are required to disclose information about the potential differences between the carrying amount and the fair value.

There are certain circumstances where the fair values are not required to be disclosed. AASB 7 states that disclosure of fair value is not required:

a) when the carrying amount is a reasonable approximation of fair value, for example, for financial instruments such as short-term trade receivables and payables;

b) for an investment in equity instruments that do not have a quoted market price in an active market, or derivatives linked to such equity instruments, that is measured at cost in accordance with AASB 139 Financial Instruments: Recognition and Measurement because its fair value cannot be measured reliably; or

1. Fair value for Loans from Government, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date.

GUIDANCE

AASB 7 allows the offsetting of assets and liabilities to the extent the carrying amounts are offset in the balance sheet.


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Reference Note 16E: Credit Risk

AASB 7.33

AASB 7.34(c)

AASB 7.36b The PRIMA Agency holds no collateral to mitigate against credit risk.

AASB 7.36(c) Credit quality of financial instruments not past due or individually determined as impaired

Not past due nor impaired

Past due or impaired


2010 2010 2009

$'000 $'000 $'000

Loans and receivablesCash and cash equivalents 7,089 6,131 - -Trade receivables 5,641 6,605 5,873 7,892

Total 12,730 # 12,736 5,873 7,892

AASB 7.37(a) Ageing of financial assets that were past due but not impaired for 20100 to 30 61 to 90 90+

days days days Total$'000 $'000 $'000 $'000

Loans and receivablesTrade receivables 3,332 669 759 1,113 5,873

Total 3,332 669 759 1,113 5,873

Ageing of financial assets that were past due but not impaired for 20090 to 30 61 to 90 90+

days days days Total$'000 $'000 $'000 $'000

Loans and receivablesTrade receivables 3,658 1,115 1,265 1,854 7,892

Total 3,658 1,115 1,265 1,854 7,892

$'000

days$'000

31 to 60

days31 to 60

PRIMA Agency has assessed the risk of the default on payment and has allocated $5,873,000 in 2010 (2009: $7,892,000) to impairment allowance account for trade receivables.

Not past due nor impaired

$'000

PRIMA Agency 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 amount is equal to the total amount of trade receivables (2010: $11,514,000 and 2009: $14,497,000). PRIMA Agency has assessed the risk of the default on payment and has allocated $2,301,000 in 2010 (2009: $3,834,000) to an impairment allowance account.

PRIMA Agency manages its credit risk by undertaking background and credit checks prior to allowing a debtor relationship. In addition, the Agency has policies and procedures that guide employees debt recovery techniques that are to be applied.

2009


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Reference

Qualitative and Quantitative Disclosure for the Nature and Extent of RiskAASB 7.33

AASB 7.34(c)

Credit RiskAASB 7 Appx

AASB 7.36(a)

AASB 7 B10

AASB 7.36

AASB 7.37

GUIDANCE

For each type of risk arising from financial instruments, the entity has to disclose the exposure, the objectives, policies and processes for measuring risk.

AASB 7 requires entities to disclose their maximum exposure to credit risk without taking into account collateral or other credit enhancements. Paragraphs B9-10 provide assistance (see below):

Paragraph 36 requires disclosure of the maximum exposure to credit risk, collateral held, information about the credit quality of financial assets that are neither past due nor impaired, and the carrying amount of assets that are past due but not impaired.

Paragraph 37 requires disclosure of the ageing of financial assets that are past due and not impaired, analysis of financial assets that are individually determined to be impaired, and descriptions of collateral held for the assets that are past due and individually determined to be impaired.

AASB 7 defines credit risk as the risk that one party to a financial instrument will cause financial loss for the other party by failing to discharge an obligation.

• for loans granted, receivables to customers and deposits with other entities, the maximum exposure to credit risk is the carrying amount of the related financial asset;

In addition, the entity is also required to provide a summary of quantitative data about its exposure to the risk, and the concentration of that risk (if it is not apparent from the other disclosure).

• for financial guarantees, the maximum exposure to credit risk is the maximum amount payable if it were called upon; and

• for loan commitments, the maximum exposure to credit risk is the full amount of the commitment, unless it can be settled net in cash.


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Reference Note 16F: Liquidity RiskAASB 7.39(c)

AASB 7.39b

AASB 7.39(a) Maturities for non-derivative financial liabilities 2010within 1 1 to 2

year years Total$'000 $'000 $'000

Other LiabilitiesLoans from Government 1,265 2,062 3,327 Finance leases 3,088 4,104 7,192 Other interest bearing liabilities 2,058 - 2,058 Trade creditors 21,087 - 21,087 Other 10,268 - 10,268

Total 37,766 6,166 43,932

Maturities for non-derivative financial liabilities 2009within 1 1 to 2

year years Total$'000 $'000 $'000

Other LiabilitiesLoans from Government 1,265 3,327 4,592 Finance leases 3,013 7,192 10,205 Other interest bearing liabilities 2,363 - 2,363 Trade creditors 29,047 - 29,047 Other 1,250 - 1,250

Total 36,938 10,519 47,457

PRIMA Agency has no derivative financial liabilities in both the current and prior year.

Liquidity RiskAASB 7 Appx A

AASB 7.39 AASB 7 requires the maturity analysis for both non-derivative and derivative financial liabilities. In addition, it requires a description of how the entity manages liquidity risk.

Entities with minimal exposure to liquidity risk, or those that have basic financial instruments, can provide a text description rather than completing the above table. In the text description, the entity should mention relevant facts such as they are an appropriated entity or that they are reliant on the sale of goods and services to fund their operations and the impact of this on their ability to meet their obligations associated with the financial liabilities.

GUIDANCE

Liquidity risk is defined as the risk that an entity will encounter difficulty in meeting obligations associated with financial liabilities.

This is highly unlikely as PRIMA Agency is appropriated funding from the Australian Government and the Agency manages its budgeted funds to ensure it has adequate funds to meet payments as they fall due. In addition, PRIMA Agency has policies in place to ensure timely payment are made when due and has no past experience of default.

PRIMA Agency's financial liabilities are payables, loans from government, finance leases and other interest bearing liabilities. The exposure to liquidity risk is based on the notion that the Agency will encounter difficulty in meeting its obligations associated with financial liabilities.


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Reference Note 16G: Market Risk

Interest Rate Risk

Market Risk

AASB 7 Appx

GUIDANCE

Market risk is defined as the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in market prices. Market risk comprises three types of risk: currency risk, interest rate risk and other price risk.

Entities are required to disclose a sensitivity analysis for each type of market risk. In doing so, the entity needs to consider a reasonably possible change in the relevant risk variable and disclose the effects to profit and loss and equity.

In addition, entities are required to disclose the methods and assumptions used in preparing the analysis and the changes in assumptions from the previous periods.

Department of Finance and Deregulation specifies default risk variables for exchange and interest rates risks.

PRIMA Agency holds basic financial instruments that do not expose the Agency to certain market risks. PRIMA Agency is not exposed 'Currency risk' or 'Other price risk'.

The only interest-bearing items on the balance sheet are the 'Loans from Government', 'Finance lease' and 'Other interest bearing liabilities'. All bear interest at a fixed interest rate and will not fluctuate due to changes in the market interest rate.


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Reference Notes to the Schedule of Administered Items

Note 17: Income Administered on Behalf of Government

2010 2009$'000 $'000

AASB 1050.7(a) REVENUE

Non–Taxation Revenue

Note 17A: Sale of Goods and Rendering of Services

Provision of goods – external parties 180,797 188,199 Total sale of goods and rendering services 180,797 188,199

AASB 118.35(b)(iii) Note 17B: InterestLoans 135 231 Total interest 135 231

AASB 118.35(b)(v) Note 17C: Dividends

Australian Government entities 1,817 1,600 Total dividends 1,817 1,600

GAINS

Note 17D: Other Gains

Resources received free of charge - 627 Total other gains - 627


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Reference Note 18: Expenses Administered on Behalf of Government

2010 2009$'000 $'000

AASB 1050.7(b) EXPENSES

Note 18A: SuppliersGoods and servicesContractors 6,594 3,511 Total goods and services 6,594 3,511

Goods and services are made up of:

Provision of goods – external parties 6,594 3,511 Total goods and services 6,594 3,511 Total suppliers expenses 6,594 3,511

Note 18B: SubsidiesPayable to related entities:

AASB 1050.22 Environmental education institutions 12,045 7,810 Environmental preservation organisations 13,248 7,331

Payable to external parties:AASB 1050.22 Environmental training companies 6,709 5,983

Total subsidies 32,002 21,124

Note 18C: Personal BenefitsDirect:

AASB 1050.22 Environmental preservation volunteers 20,200 20,200 Total personal benefits 20,200 20,200

AASB 1050.17 Note 18D: GrantsPublic sector:

State and Territory Governments 33,125 10,367 Local Governments 25,125 32,385

Private sector:Non-profit organisations 19,389 7,628

AASB 1050.22 Overseas 11,320 3,276 Total grants 88,959 53,656

AASB 136.126 Note 18E: Write-Down and Impairment of AssetsAsset write-downs and impairments from:

Impairment on financial instruments - 150 Impairment of financial assets - investments (Fun Time Ltd) - 90

Total write-down and impairment of assets - 240


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Reference 2010 2009$'000 $'000

Note 18F: Payments to CAC BodiesFlora and Fauna Protection Authority 40,850 65,568 Total payments to CAC Bodies 40,850 65,568

Note 18G: Other ExpensesOther 1,931 130 Total other expenses 1,931 130

Note 18H: Operating Expenditure for Heritage and Cultural Assets*† Operating expenditure 247 150 Total 247 150

* Only Collection Institutions need to report this note

GUIDANCE

Transfer Payments

Refer to FMO Division 91 for guidance on disclosure and types of transfer payments.

Direct and Indirect Personal BenefitsDirect personal benefits are those paid directly to recipients, whereas indirect benefits are paid to recipients by a third party.

† Operating expenditure is contained in the schedule of administered items; however, it is not disclosed as a separate line item. It is merely a representation of expenditure relating to heritage and cultural assets.


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Reference

2010 2009$’000 $’000

FINANCIAL ASSETS

AASB 1050.7(c) Note 19A: Cash and Cash EquivalentsCash on hand or on deposit 1,332 2,048 Total cash and cash equivalents 1,332 2,048

AASB 1050.7(c) Note 19B: ReceivablesGoods and services:

Goods and services receivable - related entities 7,717 9,081 Total receivables for goods and services 7,717 9,081

Advances and loans:State and Territory Governments 4,041 6,511 Local Governments 104 874

Total advances and loans 4,145 7,385

Other receivables:Interest 45 30 GST receivable from Australian Taxation Office - 284

Total other receivables 45 314 Total receivables (gross) 11,907 16,780

Less: impairment allowance account:Goods and services (940) (1,137)Other (506) (506)

Total impairment allowance account (1,446) (1,643)Total receivables (net) 10,461 15,137

Receivables are expected to be recovered in:No more than 12 months 5,001 10,137 More than 12 months 5,460 5,000

Total receivables (net) 10,461 15,137

Receivables were aged as follows:Not overdue 9,661 11,588 Overdue by:

0 to 30 days 1,876 3,883 31 to 60 days - 957 61 to 90 days 370 352

Total receivables (gross) 11,907 16,780

The impairment allowance account is aged as follows:Overdue by:

0 to 30 days (1,208) (1,357)31 to 60 days - (130)61 to 90 days (238) (156)

Total impairment allowance account (1,446) (1,643)

Note 19: Assets Administered on Behalf of Government

Goods and services receivables are with entities external to the Australian Government. Credit terms are net 30 days (2009: 30 days).

Loans are made under financial assistance legislation for periods up to 10 years. No security is generally required. Principal is repaid in full at maturity. Interest rates are fixed. Effective interest rates average 6.2% (2009: 6.1%). Interest payments are due on the last day of each year.


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Reference Reconciliation of the Impairment Allowance Account:AASB 7.16(c) Movements in relation to 2010

Advancesand loans Total

$'000 $'000Opening balance 1,643 1,643

Amounts recovered and reversed (197) (197)Closing balance 1,446 1,446

Movements in relation to 2009Advancesand loans Total

$'000 $'000

Opening balance 1,605 1,605 Amounts written off 240 240 Amounts recovered and reversed (202) (202)

Closing balance 1,643 1,643

2010 2009$’000 $’000

Note 19C: Other InvestmentsShares (or equity interest in):

Youth Employment Authority i 5,902 6,985 Youth Commission ii 9,423 8,581

Total Other Investments 15,325 15,566

Other financial assets are expected to be recovered in:More than 12 months 15,325 15,566

Total Other Financial Assets 15,325 15,566

i The Youth Employment Authority is an entity that focuses on the implementation of community based fauna and flora support programs. PRIMA Agency's investment in this entity is classified as 'available for sale' and was measured at their fair value as at 30 June 2010. Fair value has been taken to be the net assets of the entity as at end of reporting period.

ii The Youth Commission is an entity that focuses on the implementation and organisation of youth programs and activities for all young Australians. PRIMA Agency classifies its investment as 'available for sale' and was measured at their fair value as at 30 June 2010. Fair value has been taken to be the net assets of the entity as at end of reporting period.


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Reference

2010 2009$’000 $’000

AASB 1050.7(d) PAYABLES

Note 20A: SuppliersTrade creditors and accruals 1,505 1,832 Total suppliers 1,505 1,832

Supplier payables expected to be settled within 12 months:Related entities 1,000 1,200 External parties 505 632

Total 1,505 1,832 Total supplier payables 1,505 1,832

Settlement is usually made within 30 days.

Note 20B: GrantsPublic sector:

State and Territory Governments 1,985 233 Local Governments 1,522 1,921

Private sector:

Non-profit organisations 468 332 Other 130 Overseas - 67

Total grants 3,975 2,683

Total grants - are expected to be settled in:

No more than 12 months 3,975 2,683 Total grants 3,975 2,683

Note 20: Liabilities Administered on Behalf of Government

Grant liabilities to State, Territory and local Governments are recognised only to the extent that grant conditions such as grant eligibility criteria have been met by the grantee Government entity, or those governments have provided services or facilities required by the grant agreement. In such cases, only amounts outstanding in relation to current or previous periods satisfy the definition of liabilities.

POLICY

Recognition of Grant Liabilities

All grants are to entities that are part of State or Local Governments. Settlement is usually made according to the terms and conditions of each grant. This is usually within 30 days of performance or eligibility.


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Reference

2010 2009$’000 $’000

FMO 85.6 Opening administered assets less administered liabilities as at 1 July 28,236 43,573 Adjusted opening administered assets less administered liabilitiesPlus: Administered income 182,749 190,657 Less: Administered expenses (non CAC) (149,686) (98,861) Payments to CAC Act bodies (40,850) (65,568)Administered transfers to/from Australian Government:

Appropriation transfers from OPA:

Annual appropriations for administered expenses (non CAC) 146,270 135,047 Annual appropriations for payment to CAC Act bodies 40,850 65,568 Special appropriations (limited) (non CAC) 520 143

Transfers to OPA (187,956) (241,323)Restructuring - (1,000)

Administered revaluations taken to reserves 1,505 -Closing administered assets less administered liabilities as at 30 June 21,638 28,236

Disclosure

Annual Appropriations for Payment to CAC Act Bodies


Note 21: Administered Reconciliation Table

The line item 'Annual appropriations for payment to CAC Act bodies' is not required to be split into the different appropriation types.

GUIDANCE

When an agency makes a payment to a CAC Act body that is either an equity injection or a loan, that payment has a zero net change in the balance sheet of the agency. For example, in the case of a loan, cash is reduced by the amount of the loan when it is paid to the CAC Act body, and loan receivable is increased by the same amount. Therefore, the payment of these amounts to a CAC Act body is not reflected as an outgoing in this table. 'Payments to CAC Act bodies' includes only those payments that give rise to administered expense.

Refer to FMO Div 86 for the treatment of administered assets and liabilities transferred.


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Reference

FMO 80

2010 2009 2010 2009 2010 2009$’000 $’000 $’000 $’000 $’000 $’000

Contingent liabilitiesBalance from previous period 13,000 13,000 4,700 2,700 17,700 15,700 New - 2,000 - 2,100 - 4,100 Re-measurement (1,500) - - - (1,500) -Liabilities recognised - - - - - -Obligations expired (500) (2,000) (2,600) (100) (3,100) (2,100)Total contingent liabilities 11,000 13,000 2,100 4,700 13,100 17,700 Net contingent liabilities (13,100) (17,700)

AASB 137.86-92

Guarantees Indemnities Total

Note 22: Administered Contingent Assets and Liabilities


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Reference

Guarantees

Borrower Legislation Principal Balance BalanceAuthorising Covered by Outstanding OutstandingGuarantee Guarantee

2,010 2,010 2,009 $ $ $

Community Service Authority

Community Service Act 1974

(Sc 78 & 71B) 2,500,000 1,985,000 1,658,000

The following borrowings have been guaranteed by the Australian Government in respect of authorities within the PRIMA portfolio

Quantifiable Administered Contingent Liabilities

There has been a constitutional challenge on certain aspects of the Access Rights to Fauna and Florafee. The Australian Government is defending the action. It is not possible to determine the financialeffect if the challenge were to be successful.

Quantifiable Administered Contingencies that are not remote are disclosed in the Schedule of Administered Items as Quantifiable Administered Contingencies.

Unquantifiable Administered Contingent Liabilities

Significant Remote Administered Contingent Liabilities

Unquantifiable Administered Contingent Assets

Legal action has commenced to recover costs incurred in restoring native vegetation in national parkland damaged by a number of individuals and corporations in the pursuit of commercial interests. Restoration is continuing and the amount of potential damages cannot be estimated at this stage.

The schedule of Administered contingencies reports contingent liabilities in respect of guarantees of $11,000 (2009: 13,000). The amount represents an estimate of the Agency’s liability based on previous guarantee payouts.

The schedule of Administered contingencies reports contingent liabilities in respect of indemnities of $2,100 (2009: 4,700). The amount represents an estimate of the Agency’s liability based on previous indemnity payouts.


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Reference Note 23: Administered Investments

The principal activities of each of PRIMA Agency’s administered investments are as follows:

• Youth Employment Authority – the implementation of community based fauna and flora support programs.

• Youth Commission – the implementation and organisation of youth programs and activities for all young Australians.


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Reference

2010 2009$’000 $’000

AASB 7.8 Note 24A: Categories of Financial InstrumentsFinancial AssetsLoans and receivables:

Cash and cash equivalents 1,332 2,048 Goods and services receivable - related entities 7,717 9,081 Advances and loans 4,145 7,385 Other 45 314

Total 13,239 18,828 Available for sale:

Shares in - Youth Employment Authority 5,902 6,985 Shares in - Youth Commission 9,423 8,581

Total 15,325 15,566 Carrying amount of financial assets 28,564 34,394

Financial LiabilitiesAt amortised cost:

Trade creditors 1,505 1,832 Grants payable 3,984 2,683

Total 5,489 4,515 Carrying amount of financial liabilities 5,489 4,515

AASB 7.20(a) Note 24B: Net Income and Expense from Financial AssetsLoans and receivablesInterest revenue 135 231

AASB 7.20(a)(iv) Net gain loans and receivables 135 231

Available for saleAASB 7.20(a)(ii) Dividend revenue 1,817 1,600 AASB 7.20(a)(ii) Net gain available for sale 1,817 1,600

Net gain from financial assets 1,952 1,831

Note 24: Administered Financial Instruments


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Reference Note 24C: Fair Value of Financial Instruments

AASB 7.25 Carrying Fair Carrying Fairamount value amount value

2010 2010 2009 2009$'000 $'000 $'000 $'000

Financial Assets

Loans and receivables1:Advances and loans 4,145 4,228 15,566 15,877

Total 4,145 4,228 15,566 15,877

AASB 7.27

Note 24D: Credit Risk

AASB 7.33

AASB 7.34(c)

Goods and services receivablesAdvances and loans

AASB 7.36(a)

collateral or credit enhancements.

2010 2009$'000 $'000

Financial assetsLoans and receivables

Goods and services receivable - related entities 7,717 9,081 Advances and loans 4,145 15,566

Available for saleShares in - Youth Employment Authority 5,902 6,985 Shares in - Youth Commission 9,423 8,581

Total 27,187 40,213

Financial liabilitiesAt amortised cost

Other (5,489) (4,515)Total (5,489) (4,515)

AASB 7.36(b) The PRIMA Agency holds no collateral to mitigate against credit risk.

$940,000 in 2010 (2009: $1,137,000)$506,000 in 2010 (2009: $506,00)

The following table illustrates PRIMA Agency gross exposure to credit risk, excluding any

1. Fair value for loans and receivables, which is determined for disclosure purposes, is calculated based on the present value of future principal and interest cash flows, discounted at the market rate of interest at the reporting date.

The administered activities of PRIMA Agency were not exposed to a high level of credit risk as as the majority of financial assets are trade receivables, advances and loans to state, territory and localgovernments and shares in government controlled and funded entities. PRIMA Agency manages itscredit risk by undertaking background and credit checks prior to allowing a debtor relationship. In addition, the Agency has policies and procedures that guide employees debt recovery techniques that are to be applied.

PRIMA Agency has assessed the risk of the default on payment and has allocated the following amounts to an impairment allowance account:


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ReferenceAASB 7.36(c) Not Past

Due Nor Impaired



2010 2010 2009

$'000 $'000 $'000Loans and receivables

Goods and services receivable - related entities1 6,777 7,944 940 1,137 Advances and loans 3,639 6,879 506 506

Available for sale financial assetsShares in - Youth Employment Authority 5,902 6,985 - -Shares in - Youth Commission 9,423 8,581 - -

Total 25,741 # 30,389 1,446 1,643

AASB 7.37(a) Ageing of financial assets that were past due but not impaired for 20100 to 30 61 to 90

days days Total$'000 $'000 $'000

Loans and receivablesGoods and services receivable - related entities 636 270 906

Total 636 # - 270 906

Ageing of financial assets that were past due but not impaired for 20090 to 30 61 to 90

days days Total$'000 $'000 $'000

Loans and receivablesGoods and services receivable - related entities 146 557 352 1,055

Total 146 # 557 352 1,055

$'000

days

2009

31 to 60

31 to 60

Credit quality of financial instruments not past due or individually determined as impaired

days$'000

$'000

Not Past Due Nor Impaired


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Reference Note 24E: Liquidity RiskAASB 7.39(c)

The following tables illustrate the maturities for financial liabilities.

AASB 7.39(a) Maturities for non-derivative financial liabilities 2010within 1

year Total$'000 $'000

Other liabilitiesTrade creditors 1,505 1,505 Grants payable 3,984 3,984

Total 5,489 5,489

Maturities for non-derivative financial liabilities 2009within 1

year Total$'000 $'000

Other liabilitiesTrade creditors 1,832 1,832 Grants payable 2,683 2,683

Total 4,515 4,515

PRIMA Agency has no derivative financial liabilities in both the current and prior year.

Note 24F: Market Risk

AASB 7.40(b)

AASB 7.40(c) Interest rate risk

Other price risk

PRIMA Agency's financial liabilities are payables, loans from government, finance leases and other interest bearing liabilities. The exposure to liquidity risk is based on the notion that the Agency will encounter difficulty in meeting its obligations associated with financial liabilities.

This is highly unlikely as PRIMA Agency is appropriated funding from the Australian Government and the Agency manages its budgeted funds to ensure it has adequate funds to meet payments as they fall due. In addition, PRIMA Agency has policies in place to ensure timely payment are made when due and has no past experience of default.

PRIMA Agency holds basic financial instruments that does not expose the Agency to certain market risks. PRIMA Agency is not exposed 'Currency risk'.

The only interest bearing items on the balance sheet are the 'Advances and Loans'. These items have fixed interest and will not fluctuate due to changes in the market interest rate.

PRIMA Agency's administered activities are not exposed to 'Other Price Risk'. It'ss administered investments are not traded on the Australian Stock Exchange. It does not hold any other financial instruments that would be exposed to price risk.


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Reference Note 25: Appropriations

AASB 1004.64

FMO 104.15

2010 2009 2010 2009 2010 2009 2010 2009 2010 2009

$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Balance brought forward from previous period (Appropriation Acts) 1,194 1,381 486 438 - - 21,532 4,945 23,212 6,764

Appropriation Act:Appropriation Act (No. 1, 3&5) 2009-2010 as passed 34,000 30,055 29,000 26,104 40,850 65,568 150,477 109,172 254,327 230,899

Appropriations reduced (Appropriation Act sections 10, 11&12) (1,000) - - - - - - (6,068) (1,000) (6,068)

FMA Act:*Appropriations to take account of recoverable GST (FMA Act section 30A) 1 3,410 2,224 2,364 1,747 - - 13,771 7,564 19,545 11,535

Relevant agency receipts (FMA Act s 31) 114,269 99,996 114,269 99,996

Total appropriation available for payments 37,604 33,660 31,850 28,289 40,850 65,568 300,049 215,609 410,353 343,126 Cash payments made during the year (GST inclusive) (35,600) (32,166) (31,349) (27,803) 40,850 65,568 (222,133) (146,972) (248,232) (141,373)Appropriations credited to special accounts (GST exclusive) - (300) - - - - (55,500) (47,105) (55,500) (47,405)Balance of authority to draw cash from the Consolidated Revenue Fund for ordinary annual services appropriations and as represented by: 2,004 1,194 501 486 - - 22,416 21,532 24,921 23,212

Cash at bank and on hand - 148 - - - - 3,566 2,742 3,566 2,890 *Departmental appropriations receivable 18,850 18,790 18,850 18,790 *Undrawn, unlapsed administered appropriations 2,004 1,046 501 486 - - 2,505 1,532 Total as at 30 June 2,004 1,194 501 486 - - 22,416 21,532 24,921 23,212

Table A1: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for Ordinary Annual Services Appropriations

Departmental outputs TotalOutcome 1 Outcome 2Particulars

Administered expenses

Payments to CAC Act bodies

1. The amounts in this line item are calculated on an accrual basis to the extent that an expense may have been incurred that includes GST but has not been paid by year end.


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Reference

2010 2009 2010 2009 2010 2009

Reduction in administered items1

Total administered items appropriated 2009-2010 34,000,427.43 30,055,425.52 29,000,368.59 26,104,384.52 63,000,796.02 56,159,810.04

Less administered items required by the agency as per Appropriation Act s11 2 :Appropriation Act (No. 1) 2009-2010 14,919,231.52 10,722,853.42 12,841,810.21 13,347,990.41 27,761,041.73 24,070,843.83

Appropriation Act (No. 3) 2009-2010 12,678,095.46 9,678,095.46 7,223,145.64 7,401,580.65 19,901,241.10 17,079,676.11

Appropriation Act (No. 5) 2009-2010 5,389,813.49 8,654,864.48 8,935,412.74 5,354,813.46 14,325,226.23 14,009,677.94

Total administered items required by the agency as represented by:

Spent 22,772,683.94 21,906,103.27 20,445,450.68 21,005,740.64 43,218,134.62 42,911,843.91

Retention 10,214,456.53 7,149,710.09 8,554,917.91 5,098,643.88 18,769,374.44 12,248,353.97 Total reduction in administered items - effective 2010-11 1,013,286.96 999,612.16 - - 1,013,286.96 999,612.16

1. Numbers in this section of the table must be disclosed to the cent.

Table A2: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for Ordinary Annual Services Appropriations (Reduction in Administered Items)

ParticularsTotalOutcome 1

Administered expenses

Outcome 2

2. Administered items for 2009-10 were reduced to these amounts when these financial statements were tabled in the Parliament as part of PRIMA Agency's 2009-10 annual report. This reduction is effective in 2010-11 and the amounts in the Total Reduction row will be reflected in Table A1 in the 2010-11 financial statements in the row 'Appropriations reduced (Appropriation Act sections 10, 11&12)'.

Departmental and non-operating appropriations do not lapse at financial year-end. However, the responsible Minister may decide that part or all of a departmental or non-operating appropriation is not required and request the Finance Minister to reduce that appropriation. The reduction in the appropriation is effected by the Finance Minister's determination and is disallowable by Parliament.


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Reference

FMO 104.16

2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009 2010 2009$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Balance brought forward from previous period (Appropriation Acts ) 233 1,318 - - 1,382 3,009 1,068 - - - - - - - - - 1,900 2,000 4,583 6,327 Appropriation Act :

Appropriation Act (No. 2, 4&6) 2009-2010 as passed 34,000 30,367 - - 32,000 36,885 5,000 5,124 - - 1,000 18,430 - - 2,124 - - - 74,124 90,806 Appropriations reduced (Appropriation Act sections 12, 13&14) (80) (1,266) - - (800) (2,750) (1,000) - - - - - - - - - - - (1,880) (4,016)

FMA Act :

Repayments to the Commonwealth (FMA Act section 30) 3,400 3,037 - - 3,955 3,795 500 512 - - (100) (1,321) - - - - - - 7,755 6,023

Total appropriations available for payments 37,553 33,456 - - 36,537 40,939 5,568 5,636 - - 900 17,109 - - 2,124 - 1,900 2,000 84,582 99,140 Cash payments made during the year (GST inclusive) (35,495) (34,437) - - (37,251) (42,048) (5,482) (4,568) - - (1,100) (19,751) - - (2,124) - (100) (100) (81,552) (100,904)Balance of authority to draw cash from the consolidated revenue fund for other than ordinary annual services appropriations and as represented by: 2,058 (981) - - (714) (1,109) 86 1,068 - - (200) (2,642) - - - - 1,800 1,900 3,030 (1,764)

Cash at bank and on hand - - - - - - - - - - - - - - - - 1,332 1,900 1,332 1,900 *Undrawn, unlapsed administered appropriations 1,985 233 - - 504 1,382 1,018 1,068 - - - - - - - - 468 - 3,975 2,683 Total as at 30 June 1,985 233 - - 504 1,382 1,018 1,068 - - - - - - - - 1,800 1,900 5,307 4,583

TotalEquity Loans Previous years’ outputs Admin assets and liabilities

Non – operating

Payments to CAC Act bodies

1. The amounts in this line item are calculated on an accrual basis to the extent that an expense may have been incurred that includes GST but has not been paid by year end.

Operating

ParticularsSPPs

Table B1: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for Other than Ordinary Annual Services Appropriations

NAE

Outcome 1 Outcome 2

NAESPPs


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Reference

2010 2009 2010 2009 2010 2009 2010 2009 2010 2009

Reduction in administered items1

Total administered items appropriated 2009-2010 34,000,234.52 30,367,243.42 - - 31,200,011.25 36,885,436.00 5,000,231.85 5,124,340.50 70,200,477.62 72,377,019.92

Less administered items required by the agency per Appropriation Act s12 2 :Appropriation Act (No. 2) 2009-2010 14,280,426.78 13,856,653.60 - - 14,532,874.64 14,907,196.43 1,552,163.38 2,251,213.21 30,365,464.80 31,015,063.24

Appropriation Act (No. 4) 2009-2010 13,265,467.54 11,844,367.54 - - 10,352,873.12 13,688,762.67 1,375,896.18 1,002,896.67 24,994,236.84 26,536,026.88

Appropriation Act (No. 6) 2009-2010 6,175,342.00 4,585,941.75 - - 6,189,428.15 7,489,214.39 922,253.25 870,121.62 13,287,023.40 12,945,277.76

Total administered items required by the agency as represented by:

Spent 23,507,689.45 21,545,278.77 - - 21,129,393.24 24,928,230.32 3,845,343.84 4,114,773.82 48,482,426.53 50,588,282.91

Retention 10,213,546.87 8,741,684.12 9,945,782.67 11,156,943.17 4,968.97 9,457.68 20,164,298.51 19,908,084.97 Total reduction in administered items - effective 2010-11 34,000,234.52 30,367,243.42 - - 31,200,011.25 36,885,436.00 5,000,231.85 5,124,340.50 70,200,477.62 72,377,019.92

Operating

Table B2: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund for Other than Ordinary Annual Services Appropriations (Reduction in Administered Items)

2. Administered items for 2009-10 were reduced to these amounts when these financial statements were tabled in the Parliament as part of PRIMA Agency's 2009-10 annual report. This reduction is effective in 2010-11 and the amounts in the Total Reduction row will be reflected in Table B1 in the 2010-11 financial statements in the row 'Appropriations reduced (Appropriation Act sections12, 13&14)'.

ParticularsSPPs NAE

Outcome 1

1. Numbers in this section of the table must be disclosed to the cent.

TotalSPPs NAE

Outcome 2


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Reference

FMO 104.17

2010 2009

$'000 $'000

Cash payments made during the year 25,708 25,459 Total charged to appropriation 25,708 25,459 Estimated actual 24,589 24,564

FMO 104.19

2010 2009

$'000 $'000

Cash payments made during the year 30,179 29,886 Total charged to Special Appropriation 30,179 29,886

Budget estimate (list each other legislative provision that refunds have been made under) 32,300 31,454 Budget estimate (FMA Act section 28) - -

Outcome 1

Training Development Act s. 344Purpose: To provide an appropriation for special training specified by s. 344 of Training Development ActNature: Administered

Table C: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund - Special Appropriations (UnlimitedAmount)

Table D: Acquittal of Authority to Draw Cash from the Consolidated Revenue Fund - Special Appropriations (RefundProvisions)

Financial Management and Accountability Act 1997 s. 28(2)Purpose: To provide an appropriation where an Act or other law requires or permits the repayment of an amount received by the Commonwealth and apart from this section there is no specific appropriation for the repayment.Nature: Administered


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Reference Table E: Disclosure by agent in relation to Annual and Special AppropriationsFMO 104.25

2010 2009 2010 2009 2010 2009 2010 2009$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000

Total receipts 1,526 - 500 - 1,526 - 500 -Total payments (1,526) - (500) - (1,526) - (500) -Balance of receipts and payments for departmental, and for administered, for each responsible agency - - - - - - - -

AdministeredDepartmental Administered Departmental

Department of Prime

Minister and Cabinet1 Total


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Reference POLICY

Disclosure

• Budget estimate;

• cash payments made;

• appropriations credited to Special Accounts (not illustrated);

• refunds credited (section 30) – (not illustrated);

• whether the appropriation is departmental or administered; and

• the outcome(s) to which the appropriation relates.

• identify whether the special appropriation is administered or departmental;

• identify the legislative provision that provides the authority for the special appropriation;

• disclose the outcomes it is associated with;

• state that the special appropriation was not drawn on in the current or previous year; and

• for limited special appropriations, the balance available.

Entities must identify the particulars of the legislation containing the special appropriations.

There is an additional requirement to separately disclose in tables any investments made under s39 of the FMA Act (not illustrated), any refund appropriations (not illustrated) and all other unlimited special appropriations (illustrated).

The FMO require disclosure by Act. PRIMA 2009-10 applies this practice, which provides a useful summary of an agency’s unlimited special appropriations responsibility.

All special appropriations for which an agency is responsible should be disclosed, even where there has not been any expenditure or any amounts budgeted in either the current or previous period. This disclosure would be consistent with these appropriations being material by nature.

The FMO require specific disclosures in a separate table for each Appropriation Act, which contains one or more special appropriations. The disclosures are material by nature. Agencies must show for all special appropriations that are unlimited as to amount:

Where a special appropriation has not been drawn on in the current or comparative year, agencies shall make an abbreviated disclosure, that includes all the following:

Administered appropriations (including FMA Act s30A amounts for payments of GST) are generally drawn down on the day of, and in the amount of the payment to be made. They are recorded as assets only when drawn down from the Official Public Account. Accordingly reconciling items for administered appropriations will usually only comprise any amounts of a limited appropriation not yet drawn.

Departmental appropriations are recognised as cash and accounts receivable (amounts not drawn down from the Official Public Account). There are at least three types of reconciling items.

The first type are amounts legally still available for spending but the agency has relinquished control. Such items are only appropriations that are offered as savings through Additional Estimates or as formal savings in the current and prior years.

The second type of reconciling item is the net amounts of GST recoverable from the Australian Taxation Office (ATO) at the reporting date. The recoverable GST is not reported as a component of each appropriation but under administrative arrangements in place.

The third type arises where unsettled receivables (GST uncollected from customers) and payables (GST not paid to suppliers) from transactions arising on or before 31 May in the reporting period, that continue to exist at the reporting date. These transactions are accounted for on an accruals basis in the agency’s Business Activity Statements. Differences with the unspent balance of an appropriation will arise to the extent that:

• the agency has by the reporting date, remitted to the ATO amounts in respect of GST on sales which are yet to be collected.

• the ATO has reimbursed recoverable GST by the reporting date (i.e.. effectively before the agency has paid it to the supplier); and

Each Appropriation Act (including Special Appropriation Acts), their purpose and, for limited appropriations, the composition of the amount, must be identified. Payments made, as well as amounts charged for crediting to Special Accounts must be disclosed. Where an appropriation is subject to a dollar limit, the amount unspent at year-end, which remains available for use in the following financial year, must also be disclosed.


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Reference Payment to CAC Act Body Items

Special Appropriations Paid to CAC Act Bodies

GUIDANCE

Disclosure

Reduction in Administered Items

Formal Additions and Reductions FMO section 101.13

The amounts disclosed in Table A2 and B2 as administered items required for each relevant appropriation act must be disclosed as positive numbers.

The figures in the 'Total reduction in administered items - effective 2009-2010' row are transferred to the Appropriations reduced line item in Table A1 and Table B1 in the following year's financial statements as that will be the year in which the reduction actually takes place. The amounts are rounded when transferred.

Refer to FMO 104.58P and 104.59P for policies on FMO section 101.13 formal addition and reduction.

The main purpose of the disclosures in the note on appropriations (including special accounts) is to demonstrate an agency’s compliance with the purpose of each appropriation for which the agency is responsible and, where relevant, the appropriation’s dollar limit.

Table A2 and B2 address the new provisions in the Appropriation Acts that reduce an administered item to the amount stated in the agency's annual report. This replaces the former process commonly known as a section 8 reduction. These numbers must be to the cent, i.e. not rounded, as this section of the tables is the official mechanism for the reduction.

Payment to CAC Act body items in the Appropriation Acts are to be included in the administered column of Table A1 and Table B1 of the relevant portfolio department.

Special appropriations paid to CAC Act bodies must be identified as such in the relevant table. If the agency also draws down on that appropriation for its own use, this should be shown separately.


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Reference Note 26: Special Accounts

2010 2009$'000 $'000

FMO 120.8

Balance brought forward from previous period 464 294 Appropriation for reporting period - 300

Appropriations to take account of recoverable GST (FMA Act section 30A) 13 13 Total increase 477 607 Payments made to suppliers (414) (143)Total decrease (414) (143)Balance carried to next period (excluding investment balances) and represented by: 63 464 Cash - held in the Official Public Account 63 467 GST payable to the OPA - (3)Total balance carried to the next period 63 464

2010 2009$'000 $'000

Balance brought forward from previous period 3,750 837 Appropriation for reporting period 55,500 47,105 Costs recovered 66,933 57,579

Appropriations to take account of recoverable GST (FMA Act section 30A) 9,988 7,838 Other receipts 25,463 19,235 Total increase 161,634 132,594 Payments made to employees (49,565) (42,231)Payments made to suppliers (99,501) (69,341)Payments made for competitive nuetrality (5,684) (17,272)Total decrease (154,750) (128,844)Balance carried to next period (excluding investment balances) and represented by: 6,884 3,750 Cash – held by the Agency 6,673 3,989 Cash - held in the Official Public Account 196 119 Other Payables - Net GST payable to ATO (585) (358)Total balance carried to the next period 6,284 3,750

Appropriation: Financial Management and Accountability Act 1997 section 21

Purpose: For the receipt of all monies and payments of all expenditure related to the operation of the committee.

Australian Education Services Account (Departmental)

Appropriation: Financial Management and Accountability Act 1997 section 21

Australia and New Zealand Flora and Fauna Committee Account (Administered)

Purpose: For expenditure in connection with the provision of services for education in relation to natural flora and fauna.

Establishing Instrument: Australia and New Zealand Flora and Fauna Committee Act 1973; s73

Establishing Instrument: Financial Management Act 1962; section 500


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Reference

2010 2009$'000 $'000

Opening Balance 750 750 Closing Balance 750 750

2010 2009$'000 $'000

Balance carried from previous period 125 1,875 Other receipts 3,200 2,300 Total credits 3,325 4,175 Payments made: other (2,950) (4,050)Total debits (2,950) (4,050)Balance carried to next period and represented by: 375 125 Cash - held by the agency 375 125 Total balance carried to the next period 375 125

FMO 120.10

FMO 120.7

FMO 120.7

Other Trust Monies Account (Special Public Money)

Australian Education Services AccountInvestment of Special Public Money:Special Appropriations under section 39 of the FMA Act

Appropriation: Financial Management and Accountability Act 1997 section 21Establishing Instrument: Financial Management Act 1962; section 600

Special Accounts may be of an administered nature (e.g. the ANZ Committee Special Account), of a departmental nature (e.g. the Education Services account), or may contain some funds which are departmental and some administered, or may hold special public monies.

Special Account Balance

This account is interest bearing

There is a requirement to separately disclose any investments made and held under s39 of the FMA Act, any refund appropriations, and all other special accounts.

Purpose: Donations and bequests for specified research purposes are received from the public under formaltrust arrangements.

A note is required showing all credits to, debits and payments from, and balances of Special Accounts. GST collected on sales that is to be remitted to the Australian Taxation Office is not available for the purposes of a Special Account and is not credited to the account.

POLICY

PRIMA Agency has a Services for other Governments & Non-Agency Bodies Account. This account was established under section 20 of the Financial Management and Accountability Act 1997 (FMA Act). For the yearing end on 30 June 2009 the account had nil balances and there were no transactions debited or credited to it.

The purpose of the Services for other Governments & Non-Agency Bodies Special Account is for expenditure in connection with services performed on behalf of other Governments and bodies that are not Agencies under the FMA Act.

Special Account Balance

GUIDANCE

Special accounts must report separately each source of appropriation receipts (including an amount for transfers from each other Special Account), as well as costs recovered and each major class of other receipt and payment.

Disclosure

The balance of a Special Account represents an amount of appropriation available to an agency for the purposes of the Special Account.


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Reference Note 27: Compensation and Debt Relief

2010 2009$ $

Departmental

FMO 122.1(a) Two 'Act of Grace' expenses were made during the reporting period. (2008: No payments made). 1,236,000 -

No above expenses were paid on a periodic basis (2009: No above expenses were paid on a periodic basis). - -

No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997 (2009: No waiver made). - -

No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period (2009: No payments made).

- -

No ex-gratia payments were provided for during the reporting period (2009: No payments made). - -

FMO 122.1(f) No payments were provided in special circumstances relating to APS employment pursuant to section 73 of the Public Service Act 1999 (PS Act) during the reporting period. (2009: No payments made). - -


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Reference Administered

FMO 122.1(a) Three ‘Act of Grace’ expenses were incurred during the reporting period (2009: two expenses). 1,931,400 130,542

Two of the above expenses amounting to $2,156 were paid on a periodic basis (2009: one expense amounting to $1,134). Both are expected to continue in future years. The estimated amount outstanding in relation to payments being made on a periodic basis as at 30 June 2010 was $10,567 ($12,945 at 30 June 2009).

FMO 122.1(c)(i) No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997 . (2009: No waivers). - -

FMO 122.1(c)( ii)

- 496

FMO 122.1(d) No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period. (2009: No payments made)

- -

FMO 122.1(e) No ex-gratia payments were provided for during the reporting period. (2008: No payments).

- -

FMO 122.1(f) No payments were provided in special circumstances relating to APS employment pursuant to section 73 of the Public Service Act 1999 (PS Act) during the reporting period. (2009: No payments made) - -

No waivers of amounts owing to the Australian Government were made pursuant to subsection 37A of the Fauna and Flora Act 1985. (2009: One waiver).


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Reference

Disclosure

For further information on the CDDA Scheme see Finance Circular 2009/09 Discretionary Compensation and Waiver of Debt Mechanisms.

The number and aggregate amounts of payments or amounts waived must be shown.

Agencies are required to show the number and aggregate amounts of:

GUIDANCE

• ex-gratia payments; and

CDDA Scheme

POLICY

Disclosures are required to be made regardless of whether the relevant amounts are considered to be material. As such, disclosure is required even where no payments are made.

Where periodic Act of Grace payments are made, the amounts outstanding at year-end must be disclosed in addition to the payments made during the current reporting period.

The Scheme for Compensation for Detriment Caused by Defective Administration (CDDA Scheme) is a method for agencies to provide compensation to persons who have been adversely affected by the misadministration of agencies, but who have no legal means to seek redress, such as a legal claim against the Australian Government. Payments made under this scheme must be shown.

paid during the reporting period.

• payments made under s73 of the Public Service Act 1999 (APS employment payments in special circumstances)

The note must disclose the number of cases and aggregate amount for those cases expensed during the reporting period under each of the mechanisms specified above.

The note must also include the number and aggregate present value amount of those cases relating to any provisions at the end of the reporting period under each of the mechanisms specified above.


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Reference Note 28: Assets Held in Trust

FMO 38.2(a) Monetary assets

FMO 38.2(a) Non-monetary assets

2010 2009$'000 $'000

FMO 38.2(b) Donations and BequestsTotal amount held at the beginning of the reporting period 125 1,875 Receipts 3,200 2,300 Payments (2,950) (4,050)Total amount held at the end of the reporting period 375 125

Agency has no non-monetary assets held in trust in both the current and prior years.

Monetary assets held in trust were also disclosed in Note 26 in the table titled 'Other Trust Monies Account (Trust)'.

Donations and bequests for specified research purposes are received from the public under formal trust arrangements. These monies are not available for other purposes of the Agency and are not recognised in the financial statements. These assets are reported as assets held in trust, within this note.


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Reference

FMO 121.9,10

Note 29A: Net Cost of Outcome Delivery

2010 2009 2010 2009 2010 2009 2010 2009

$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000Expenses

Administered 87,205 62,817 62,481 36,044 40,850 65,568 190,536 164,429

Departmental 95,685 76,482 222,614 191,904 318,299 268,386

Total 182,890 139,299 285,095 227,948 40,850 65,568 508,835 432,815

Income from non-government sector

AdministeredActivities subject to cost recovery 120,831 125,778 59,966 62,421 180,797 188,199 Interest on loans 74 127 61 104 135 231 Dividends from Commonwealth Companies 999 880 818 720 1,817 1,600

Total administered 121,904 126,785 60,845 63,245 182,749 190,030 Departmental

Activities subject to cost recovery 32,120 27,222 100,242 102,380 132,362 129,602 Interest on cash deposits - - - 42 - 42 Gain from disposal of asset 371 755 - - 371 755 Reversal of previous asset write-downs - - - 3,312 - 3,312 Goods and services income 17,555 18,234 17,638 18,320 35,193 36,554

Other - 394 - - - 394

Total departmental 50,046 46,605 117,880 124,054 167,926 170,659

Total 171,950 173,390 178,725 187,299 350,675 360,689

Other own-source income

Administered - 627 - - - - - 627 Departmental 10,254 - 10,755 35 21,009 35

Total 10,254 627 10,755 35 - - 21,009 662

Net cost of outcome delivery 686 (34,718) 95,615 40,614 40,850 65,568 137,151 71,464

FMO 121.51P

Note 29: Reporting of Outcomes

**This table includes income from activities subject to competitive neutrality. The following competitive neutrality expenses were made in relation to those activities:

PRIMA Agency uses an Activity Based Costing System to determine the attribution of its shared items. This system was based on a time and motion study for corporate activities conducted in the year 2004 for the 2005-06 Budget. An update of the time and motion study was concluded for the 2008-09 Budget. The basis of attribution in the above table is consistent with the basis used for the Budget.

Outcome 2 TotalOutcome 1 Payments to CAC Act bodies*

Outcomes 1 and 2 are described in Note 1.1 . Net costs shown include intra-government costs that are eliminated in calculating the actual Budget Outcome.

* Payments to CAC Act bodies are not related to outcomes. They are included here so the total can agree to the resourcing table.


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Reference 2010 2009

$'000 $'000FMO 123.1 Competitive Neutrality

Commonwealth tax equivalent expense* 5,684 17,410 Total competitive neutrality 5,684 17,410

2010 2009 2010 2009 2010 2009 2010 2009

$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000AASB 1052.15(c) Departmental Expenses:

Employees 40,249 29,699 73,094 54,880 113,343 84,579 Suppliers 50,400 41,048 136,641 110,962 187,041 152,010 Depreciation and amortisation 4,043 5,464 6,202 8,381 10,245 13,845 Finance costs 450 - 300 239 750 239 Write-down and impairment of assets - - - 232 - 232 Other expenses 686 11 550 60 1,236 71 Commonwealth tax equivalent payment 4,691 17,139 993 271 5,684 17,410

Total 100,519 93,361 217,780 175,025 318,299 268,386

AASB 1052.15(d) Departmental Income:

Sale of goods and services 55,992 49,456 132,122 116,700 188,114 166,156

Income from government 45,364 31,967 106,118 74,778 151,482 106,745

Interest - - - 42 - 42 Total 101,356 81,423 238,240 191,520 339,596 272,943

AASB 1052.16 Departmental Assets:Cash and cash equivalents 2,309 2,046 2,458 2,512 2,322 1,573 7,089 6,131 Trade and other receivables 13,429 15,172 11,789 12,047 4,741 4,358 29,959 31,577 Land and buildings 42,763 43,565 42,079 42,745 89,451 91,612 174,293 177,922 Property, plant and equipment 24,510 16,429 25,110 20,156 - - 49,620 36,585 Intangibles 3,102 1,047 2,165 574 - - 5,267 1,621 Inventories 1,723 627 2,418 849 1,761 427 5,902 1,903 Other non-financial assets 1,456 881 1,045 609 1,149 274 3,650 1,764

Total 89,292 79,767 87,064 79,492 99,424 98,244 275,780 257,503

AASB 1052.16 Departmental Liabilities:Suppliers 11,071 14,581 7,821 9,648 2,195 4,818 21,087 29,047 Other payables 4,502 3,413 5,187 5,882 3,239 2,845 12,928 12,140 Loans - - - - 3,327 4,592 3,327 4,592 Leases 2,914 4,678 2,567 3,924 1,711 1,603 7,192 10,205 Other interest bearing liabilities - - - - 2,058 2,363 2,058 2,363 Employee provisions 18,952 17,243 16,451 15,227 15,555 13,528 50,958 45,998 Other provisions 1,145 1,192 1,389 1,172 989 1,072 3,523 3,436

Total 38,584 41,107 33,415 35,853 29,074 30,821 101,073 107,781

FMO 121.51P

Note 29B: Major Classes of Departmental Expense, Income, Assets and Liabilities by Outcomes

* The amount of Commonwealth tax equivalent payable on the taxable profit for the period is $Nil as at 30 June 2010. This differs to the Commonwealth tax equivalent amount disclosed above due to timing differences recognised in accordance with AASB 112 Income Taxes.

Outcomes 1 and 2 are described in Note 1.1. Net costs shown include intra-government costs that were eliminated in calculating the actual Budget outcome.

Outcome 1 Outcome 2 Not attributed*

* Assets and liabilities that can not be reliably attributed to outcomes.

Total


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Reference

AASB 1050.7

2010 2009 2010 2009 2010 2009 2010 2009 2010 2009$’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000 $’000

AASB 1050.7(b) Administered expenses

Suppliers 3,779 2,012 2,815 1,499 - - 6,594 3,511 Subsidies 17,601 11,618 14,401 9,506 - - 32,002 21,124 Personal benefits 11,010 11,010 9,190 9,190 - - 20,200 20,200 Grants 48,365 28,005 40,594 25,651 - - 88,959 53,656 Write-down and impairment of assets - - - 240 - - - 240 CAC Act body payment item - - - - 40,850 65,568 40,850 65,568 Other 788 60 1,143 70 - - 1,931 130

Total 81,543 52,705 68,143 46,156 40,850 65,568 190,536 164,429

AASB 1050.7(a) Administered incomeSale of goods and services 120,831 125,778 59,966 62,421 180,797 188,199 Interest 70 151 65 80 135 231 Dividends 1,457 1,000 360 600 1,817 1,600

Total 122,358 126,929 60,391 63,101 182,749 190,030

AASB 1050.7(c) Administered assetsCash and cash equivalents 452 729 487 933 - - 393 386 1,332 2,048 Receiveables 3,895 5,451 4,679 7,834 - - 1,887 1,852 10,461 15,137 Other investments - - - - - - 15,325 15,566 15,325 15,566

Total 4,347 6,180 5,166 8,767 - - 17,605 17,804 27,118 32,751

AASB 1050.7(d) Administered liabilitiesSuppliers 1,026 1,154 327 421 152 257 1,505 1,832 Grants 1,930 1,374 2,045 1,309 - - 3,975 2,683

Total 2,956 2,528 2,372 1,730 152 257 5,480 4,515

Outcomes 1 and 2 are described in Note 1.1.

* Assets and liabilities that can not be reliably attributed to outcomes.

TotalNot attributed*Outcome 1 Payments to CAC Act bodiesOutcome 2

Note 29C: Major Classes of Administered Expenses, Income, Assets and Liabilities by Outcomes


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Reference

FMO 121.4

FMO 121.5

FMO 121.12-15

AASB 1050.7

Tables A, B and C should agree to information in the statement of comprehensive income, balance sheet and schedule of administered items as appropriate.

From 2009-10, the Appropriations Acts specify that appropriations for payment to CAC Act bodies are drawn down by an FMA Act agency and then paid to the authority.

Appropriations for payment to CAC Act bodies are not considered to be activities of the agency, so they should not be attributed to outcomes but still need to be disclosed for completeness.


GUIDANCE

Table A

Disclosure of cost recoveries is mandatory, as required by the Government’s response to the Productivity Commission Report No. 15 Cost Recovery by Government Agencies (August 2001).

Table B

AASB 1052 Disaggregated Disclosures paragraph 15 and 16 requires disclosure of income, expenses, assets and liabilities by major activity. In Schedule 1 major activity refers to outcome level disclosure.

POLICY


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