The Inspector-General of Taxation

Statement by the Inspector-General of Taxation and Chief Finance Officer

Certification of financial statements

In our opinion, the attached financial statements for the year ended 30 June 2015 comply with subsection 42(2) of the Public Governance, Performance and Accountability Act 2013 (PGPA Act), and are based on properly maintained financial records as per subsection 41(2) of the PGPA Act.

In our opinion, at the date of this statement, there are reasonable grounds to believe that the Inspector-General of Taxation will be able to pay its debts as and when they fall due.

  • [SIGNED]
    Ali Noroozi
    Inspector-General of Taxation
    17 September 2015
  • [SIGNED]
    Andrew McLoughlin
    Chief Finance Officer
    17 September 2015

Statement of Comprehensive Income
for the period ended 30 June 2015

   Notes 2015
$
2014
$
NET COST OF SERVICES      
Expenses      
Employee benefits 4A 1,774,824 1,803,347
Suppliers 4B 866,787 875,587
Depreciation and amortisation 4C 43,261 41,796
Finance costs 4D 5,814 2,757
Total Expenses   2,690,686 2,723,487
       
LESS:      
Own-source income      
Own-source revenue      
ANAO audit services received free of charge   60,000 55,000
Total own-source revenue   60,000 55,000
Gains      
Resources received free of charge   39,368 33,346
Gains from reversal of make-good   99,232 -
Total gains   138,600 33,346
Total own-source income   198,600 88,346
Net cost of services   (2,492,086) (2,635,141)
       
Revenue from Government   2,788,000 2,626,000
Surplus/(Deficit) attributable to the Australian Government   295,914 (9,141)
       
OTHER COMPREHENSIVE INCOME      
Items not subject to subsequent reclassification to net cost of services      
Changes in asset revaluation reserves   (55,524) (3,730)
Total other comprehensive income   (55,524) (3,730)
       
Total comprehensive income/(loss) attributable to the Australian Government   240,390 (12,871)

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

Statement of Financial Position
as at 30 June 2015

    Notes 2015
$
2014
$
ASSETS      
Financial assets      
Cash and cash equivalents   113,832 45,019
Trade and other receivables 6A 4,216,071 3,375,753
Total financial assets   4,329,903 3,420,772
Non-financial assets      
Property, plant and equipment 7A 13,664 20,359
Leasehold improvements 7A 44,948 128,501
Intangibles 7A 247,561 -
Other non-financial assets 7B 25,135 37,844
Total non-financial assets   331,308 186,704
Total assets   4,661,211 3,607,476
       
LIABILITIES      
Payables      
Suppliers 8A 71,306 68,259
Other payables 8B 57,780 88,095
Total payables   129,086 156,354
Provisions      
Employee provisions 9A 489,466 427,726
Other provisions 9B - 93,418
Total provisions   489,466 521,144
Total liabilities   618,552 677,498
Net assets   4,042,659 2,929,978
       
EQUITY      
Contributed equity   975,573 137,573
Reserves   382,409 437,933
Retained surplus   2,684,677 2,354,472
Total equity   4,042,659 2,929,978

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

Statement of Changes in Equity
for the period ended 30 June 2015

  Retained earnings Asset revaluation reserves Contributed equity Total equity
   2015
$
2014
$
2015
$
2014
$
2015
$
2014
$
2015
$
2014
$
Opening balance as at 1 July                
Balance carried forward from previous period 2,354,472 2,375,681 437,933 441,663 137,573 107,573 2,929,978 2,924,917
Adjustment to prior year entitlements 34,291 (12,068) - - - - 34,291 (12,068)
Adjusted opening balance 2,388,763 2,363,613 437,933 441,663 137,573 107,573 2,964,269 2,912,849
Comprehensive income                
Revaluations - - (55,524) - - - (55,524) -
Re-statement of make-good - - - (3,730) - - - (3,730)
Surplus/(deficit) for the period 295,914 (9,141) - - - - 295,914 (9,141)
Total comprehensive income 295,914 (9,141) (55,524) (3,730) - - 240,390 (12,871)
Transactions with owners                
Contributions by owners                
Departmental capital budget appropriation - - - - 30,000 30,000 30,000 30,000
Equity injection appropriation - - - - 808,000 - 808,000 -
Total transactions with owners - - - - 838,000 30,000 838,000 30,000
Closing balance as at 30 June 2,684,677 2,354,472 382,409 437,933 975,573 137,573 4,042,659 2,929,978

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

Cash Flow Statement
for the period ended 30 June 2015

    Notes 2015
$
2014
$
       
OPERATING ACTIVITIES      
Cash received      
Appropriations   2,528,902 2,293,458
Net GST received   56,829 54,049
Total cash received   2,585,731 2,347,507
Cash used      
Employees   1,709,107 1,665,410
Suppliers   807,811 790,614
Total cash used   2,516,918 2,456,024
Net cash from (used by) operating activities 10 68,813 (108,517)
       
INVESTING ACTIVITIES      
Cash used      
Purchase of intangibles   256,098 1,930
Total cash used   256,098 1,930
Net cash from (used by) investing activities   (256,098) (1,930)
       
FINANCING ACTIVITIES      
Cash received      
Contributed equity   256,098 57,414
Total cash received   256,098 57,414
Net cash from (used by) financing activities   256,098 57,414
       
Net increase (decrease) in cash held   68,813 (53,033)
Cash at the beginning of the reporting period   45,019 98,052
Cash at the end of the reporting period   113,832 45,019
       

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

Schedule of Commitments
as at 30 June 2015

   2015
$
2014
$
BY TYPE    
Commitments receivable    
Net GST recoverable on commitments 1,863 111,349
Total commitments receivable 1,863 111,349
     
Commitments payable    
Other commitments    
Operating leases1 27,642 1,224,844
Other commitments2 480,000 720,000
Total other commitments 507,642 1,944,844
Total commitments payable 507,642 1,944,844
Net commitments by type 505,779 1,833,495
     
BY MATURITY    
Commitments receivable    
Within 1 year 1,863 22,172
Between 1 to 5 years - 89,177
More than 5 years - -
Total commitments receivable 1,863 111,349
     
Commitments payable    
Operating lease commitments    
Within 1 year 27,642 243,896
Between 1 to 5 years - 980,948
More than 5 years - -
Total operating lease commitments 27,642 1,224,844
     
Other commitments    
Within 1 year 240,000 240,000
Between 1 to 5 years 240,000 480,000
More than 5 years - -
Total other commitments 480,000 720,000
Total commitments payable 507,642 1,944,844
Net commitments by maturity 505,779 1,833,495
     

Note: Commitments are GST inclusive where relevant

Note Nature of lease General description of leasing arrangements
1 Leases for office accommodation The agreement allows for annual fixed rental increases. IGT has entered a new lease at the current premises effective 1 September 2015. As such, the existing lease commitment has been amended to reflect the new expiry date of 31 August 2015.
Note Description General description of the agreement
2 Service Agreement for the provision of office services The agreement allows for an annual increase in-line with the Wage Cost Index (WCI).

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

Note 1: Summary of significant accounting policies

1.1 Objectives of the Inspector-General of Taxation

The Inspector-General of Taxation (IGT) is an Australian Government controlled entity. It is a not-for-profit entity. The objective of the IGT is to improve the administration of the tax laws for the benefit of all taxpayers. The IGT is structured to meet one outcome:

Improved tax administration through community consultation, review, and independent advice to Government.

Entity activities contributing toward this outcome are classified as departmental. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the entity in its own right.

The Inspector-General of Taxation Act 2003 as amended (the Act) established an independent statutory entity to:

  • improve the administration of taxation laws for the benefit of all taxpayers, tax practitioners and other entities;
  • provide independent advice to the government on the administration of taxation laws;
  • investigate complaints by taxpayers, tax practitioners or other entities about the administration of taxation laws; and
  • investigate administrative action taken under taxation laws, including systemic issues, that affect taxpayers, tax practitioners or other entities.

 

The IGT’s departmental activities are identified under Outcome 1 by one program, Program 1.1 Inspector-General of Taxation. IGT has no administered activities.

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

1.2 Basis of preparation of the financial statements

The financial statements are required by section 42 of the Public Governance, Performance and Accountability Act 2013 and are general purpose financial statements.

The financial statements and notes have been prepared in accordance with:

  • the Financial Reporting Rule (FFR) for reporting periods ending on or after 1 July 2014; and
  • Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.

The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

The financial statements are presented in Australian dollars and values are expressed in whole dollars.

Unless an alternative treatment is specifically required by an accounting standard or the FFR, assets and liabilities are recognised in the Statement of Financial Position when and only when it is probable that future economic benefits will flow to the entity or a future sacrifice of economic benefits will be required and the amounts of assets or liabilities can be reliably measured. However, assets and liabilities arising under executory contracts are not recognised unless required by an accounting standard. Liabilities and assets that are unrecognised are reported in the Schedule of Commitments and the Contingencies note (no unquantifiable or remote contingencies, have been reported at Note 11).

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.

1.3 Significant accounting judgements and estimates

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

  • the liability for long service leave has been determined by reference to FFR 24 using the shorthand method;
  • the employee provision has been determined with reference to standard parameters provided by the Department of Finance, expected tenure of staff, future salary movements and future discount rates;
  • the fair value of leasehold improvements and property, plant and equipment has been taken to be the market value of similar properties or depreciated replacement value as determined by an independent valuer; and
  • the make-good provision has been calculated with reference to building costs required to restore the premises to original condition as required in the lease.

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 reporting period.

1.4 Changes in Australian Accounting Standards

Adoption of new Australian Accounting Standard requirements

AASB 1055 Budgetary Reporting was issued prior to the signing of the statement by the Inspector-General of Taxation and Chief Finance Officer which was applicable to the current reporting period. This standard did not have a material effect on the entities financial statements.

The entity chose to early adopt AASB 2015-7 Amendments to Australian Accounting Standards – Fair Value Disclosures of Not-for-Profit Public Sector Entities. This standard did not have a material effect on the entities financial statements.

No other accounting standards have been adopted earlier than the application date as stated in the standard. No new accounting standards, amendments to standards and interpretations issued by the AASB prior to the sign-off date that are applicable to the current period have had a material financial impact on the entity.

Future Australian Accounting Standard requirements

Of the new standards, amendments to standards and interpretations issued by the AASB that are applicable to future periods, it is estimated that the impact of adopting the pronouncements when effective will have no material financial impact on future reporting periods, but may affect disclosures in future financial reports.

1.5 Revenue

Revenue from Government

Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the entity gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned.

Appropriations receivable are recognised at their nominal amounts.

Other types of revenue

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 amount of revenue, stage of completion and transaction costs incurred can be reliably measured; and
  • the probable economic benefits with the transaction will flow to the entity.

The stage of completion of contracts at the reporting date is determined by reference to the proportion that costs incurred to date bear to the estimated total costs of the transaction.

Receivables for services, which have 30 day terms, are recognised at the nominal amounts due, less any impairment allowance amount. Collectability of debts is reviewed at the end of the reporting period. Allowances are made when collectability of the debt is no longer probable.

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

1.6 Gains

Resources received free of charge

Resources received free of charge are recognised as gains when and only when a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense.

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

Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition, unless received from another government entity as a consequence of a restructuring of administrative arrangements.

Sale of assets

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

1.7 Transactions with the Government as owner

Equity injections

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

1.8 Employee benefits

Liabilities for termination benefits due within twelve months of the end of the reporting period are measured at their nominal amounts. The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

Other employee benefits are measured as the net total of the present value of the defined benefit obligation at the end of 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.

Leave

The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of the entity is estimated to be less than the annual entitlement for sick leave.

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

The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and redundancy

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

Superannuation

Staff of the entity in general are members of the Public Sector Superannuation Scheme (PSS) or the PSS accumulation plan (PSSap).

The PSS is a defined benefit scheme for the Australian Government. The PSSap is a defined contribution scheme.

The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported by the Department of Finance’s administered schedules and notes.

The entity makes employer contributions to the employees’ superannuation scheme at rates determined by an actuary to be sufficient to meet the cost to the Government. The entity accounts for the contributions as if they were contributions to defined contribution plans.

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

1.9 Leases

A distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and rewards incidental to ownership of leased non-current assets. An operating lease is a lease that is not a finance lease. In operating leases, the lessor effectively retains substantially all such risks and benefits.

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 recognised at the same time and for the same amount.

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.

Operating lease payments are expensed on a straight line basis which is representative of the pattern of benefits derived from the leased assets.

1.10 Borrowing costs

All borrowing costs are expensed as incurred.

1.11 Fair Value Measurement

The entity deems transfers between levels of the fair value hierarchy to have occurred at the end of the reporting period.

1.12 Cash

Cash is recognised at its nominal amount.

Cash and cash equivalents includes cash on hand, cash held with outsiders and demand deposits in bank accounts with an original maturity of three months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value.

1.13 Financial assets

The IGT classifies its financial assets as loans and receivables.

The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Financial assets are recognised and derecognised upon ‘trade date’.

Loans and receivables

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.

Impairment of financial assets

Financial assets are assessed for impairment at each balance date.

  • Financial assets held at amortised cost — If there is objective evidence that an impairment loss has been incurred for loans and receivables, 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.

1.14 Financial liabilities

Financial liabilities are classified as other financial liabilities. Financial liabilities are recognised and derecognised upon ‘trade date’.

Other financial liabilities

Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.

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).

1.15 Contingent liabilities and contingent assets

Contingent liabilities and contingent assets are not recognised in the Statement of Financial Position 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 recognised when settlement is greater than remote.

1.16 Acquisition of assets

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 incomes 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 entity’s accounts immediately prior to the restructuring.

1.17 Leasehold improvements and property, plant and equipment

Asset recognition threshold

Purchases of leasehold improvements and property, plant and equipment are recognised initially at cost in the Statement of Financial Position, except for purchases costing less than $2,000 and computer equipment of less than $1,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to make-good provisions in property leases taken up by the IGT where there exists an obligation to restore the property to its original condition. These costs are included in the value of the IGT’s leasehold improvements with a corresponding provision for the ‘make good’ recognised.

Revaluations

Fair values for each class of asset are determined as shown below.

Asset class Fair value measured at
Leasehold improvements Estimated replacement cost of office fitout adjusted for remaining useful life.
Property, plant and equipment Estimated replacement cost of similar assets adjusted for remaining useful life.

Following initial recognition at cost, property plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations were conducted with sufficient frequency to ensure that the carrying amounts of assets did not differ materially with 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. A fair value review was undertaken by the independent valuer at 30 June 2014 who confirmed that the carrying amount of non-financial assets has not materially changed since the last valuation.

Revaluation adjustments were made on a class basis. Any revaluation increment was credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus or deficit. Revaluation decrements for a class of assets were recognised directly through surplus or deficit except to the extent that they reversed a previous revaluation increment for that class.

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

Depreciable property, plant and equipment assets are written off to their estimated residual values over their estimated useful lives to the entity using, in all cases, the straight-line method of depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease.

Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate. Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

  2015 2014
Property, plant and equipment
Leasehold improvements
3-10 years 3-10 years
Lease term Lease term
Impairment

All assets were assessed for impairment as at 30 June 2015. 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.

The recoverable amount of an asset is the higher of its fair value less costs of disposal and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if the IGT were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

No indicators of impairment were found for assets at fair value.

1.18 Intangibles

IGTs intangibles comprise purchased software for internal use. These assets are carried at cost less accumulated amortisation and any accumulated impairment losses.

Software is amortised on a straight-line basis over its anticipated useful life, being five years (2014: not applicable).

All software assets were assessed for indications of impairment at 30 June 2015. No indicators of impairment were identified as at 30 June 2015 (2014: not applicable).

1.19 Taxation

The entity is exempt from all forms of taxation except for Fringe Benefits Tax and Goods and Services Tax (GST). Revenues, expenses and assets are recognised net of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office, and except for receivables and payables.

1.20 Legal Compliance

The Australian Government continues to have regard to developments in case law, including the High Court’s most recent decision on Commonwealth expenditure in Williams v Commonwealth [2014] HCA 23, as they contribute to the larger body of law relevant to the development of Commonwealth programs. In accordance with its general practice, the Government will continue to monitor and assess risk and decide on any appropriate actions to respond to risks of expenditure not being consistent with constitutional or other legal requirements.

Section 83 of the Constitution provides that no amount may be paid out of the Consolidated Revenue Fund except under an appropriation made by law.

The entity has reviewed its processes and controls over payments for these items and determined that there is a low risk of the certain circumstances mentioned in the legal advice applying to the entity.

Note 2: Events after the reporting period

The IGT entered into a new lease arrangement for accommodation in August 2015, the terms and conditions of which take effect from 1 September 2015. Under the new arrangements, IGT is no longer required to make-good the premises at the end of the lease.

Note 3: Net Cash Appropriation Arrangements

   2015
$
2014
$
Total comprehensive income (loss) less depreciation/amortisation expenses previously funded through revenue appropriations and other comprehensive income1 283,651 28,925
Plus: depreciation/amortisation expenses previously funded through revenue appropriation (43,261) (41,796)
Total comprehensive income (loss) — as per the Statement of Comprehensive Income 240,390 (12,871)

1. From 2010-11, the Government introduced net cash appropriation arrangements, where revenue appropriations for depreciation/amortisation expenses ceased. Entities now receive a separate capital budget provided through equity appropriations. Departmental capital budgets are to be appropriated in the period when cash payment for capital expenditure is required.

Note 4: Expenses

   2015
$
2014
$

Note 4A: Employee benefits

   
Wages and salaries1 1,376,193 1,378,622
Superannuation:    
Defined contribution plans 102,992 101,429
Defined benefit plans 96,627 92,559
Leave and other entitlements 192,315 223,854
Other employee expenses 6,697 6,883
Total employee benefits 1,774,824 1,803,347

Note 4B: Suppliers

Goods and services supplied or rendered    
Consultants, contractors and secondees1 42,314 100,631
Travel 86,107 80,349
Service level agreement with Treasury 247,885 209,277
Fees — Audit, Membership and Other 66,525 64,627
Property operating expenses 20,013 19,204
Advertising and printing 4,905 20,926
Seminars and conferences 19,219 15,704
Subscriptions and periodicals 9,485 3,657
Information communication technology 40,875 10,517
Other 28,000 36,695
Total goods and services supplied or rendered 565,328 561,587
     
Goods supplied in connection with    
Related parties - 827
External parties 13,330 13,848
Total goods supplied 13,330 14,675
Services rendered in connection with    
Related parties1 291,340 304,426
External parties 260,658 242,486
Total services rendered 551,998 546,912
Total goods and services supplied or rendered 565,328 561,587
     
Other suppliers    
Operating lease rentals    
External parties    
Minimum lease payments 293,263 301,224
Workers compensation expenses 8,196 12,776
Total other suppliers 301,459 314,000
Total suppliers 866,787 875,587

Note 4C: Depreciation and amortisation

   
Depreciation    
Property, plant and equipment 6,695 14,023
Total depreciation 6,695 14,023
     
Amortisation    
Leasehold improvements 28,029 27,773
Computer software 8,537 -
Total amortisation 36,566 27,773
Total depreciation and amortisation 43,261 41,796

 

Note 4D: Finance costs

Unwinding of discount 5,814 2,757
Total finance costs 5,814 2,757

1. Comparatives figures have been restated to reflect the reallocation of expenses relating to secondees from wages and salaries to consultants, contractors and secondees.

Note 5: Fair Value Measurements

Note 5A: Fair value measurements, valuation techniques and inputs used

 
  Fair value measurements at the end of the reporting period For Levels 2 and 3 fair value measurements
   2015
$
2014
$
Category
(Level 1, 2 or 3)
Valuation technique(s)1 Inputs used
Non-financial assets          
Furniture 3,493 7,491 Level 3 Cost Approach Estimated replacement cost of similar assets adjusted for remaining useful life.
Office Equipment 10,171 12,868 Level 3 Cost Approach Estimated replacement cost of similar assets adjusted for remaining useful life.
Leasehold improvements 44,948 128,501 Level 3 Cost Approach Estimated replacement cost of office fitout adjusted for remaining useful life.
Total non-financial assets 58,612 148,860      

1. Valuations are based on advice from independent certified practicing valuers. There has been no change in this method from prior years.

2. Revaluation relates to the impairment of the underlying asset associated with de-recognition of the make-good provision.

IGT’s policy for determining when transfers between levels are deemed to have occurred can be found at Note 1.11.

A reconciliation of the movements in Level 3 assets can be seen in the reconciliation of the opening and closing balances of leasehold improvements and property, plant and equipment.

Recurring and non-recurring Level 3 fair value measurements — valuation processes

IGT procured valuation services from Preston Rowe Patterson Valuers (PRP). PRP provided a written assurance that the valuation model is in compliance with AASB 13 — Fair Value Measurement. PRP valuations are based on the most recent comprehensive valuation of IGT’s fixed assets. PRP has used the cost approach which reflects the amount that would be required currently to replace the service capacity of IGT’s fixed assets. PRP has updated the depreciated replacement cost analysis relative to current replacement cost for each asset and the expended useful life to establish an appropriate estimate of fair value as at 30 June 2014. All assets were assessed for impairment as at 30 June 2015.

Recurring Level 3 fair value measurements — sensitivity of inputs

The fair value estimates provided based on Level 3 inputs are sensitive to movements in replacement cost as at the reporting date, either up or down. Adopted useful life, expended useful and remaining useful life are considered to be generally stable inputs and would not be subject to sensitivity unless the entity revised its policy with respect to the useful life of a particular asset class.

Note 6: Financial Assets

   2015
$
2014
$

Note 6A: Trade and other receivables

   
Appropriations Receivable:    
From operational funding 3,566,324 3,307,226
From capital funding 641,902 60,000
Total appropriations receivable 4,208,226 3,367,226
     
Other receivables:    
GST receivable from the Australian Taxation Office 7,845 8,527
Total other receivables 7,845 8,527
     
Total trade and other receivables (gross) 4,216,071 3,375,753
     
Total trade and other receivables (net) 4,216,071 3,375,753
     
Receivables expected to be recovered    
No more than 12 months 4,216,071 3,375,753
Total trade and other receivables (net) 4,216,071 3,375,753
     
Trade and other receivables (gross) aged as follows    
Not overdue 4,216,071 3,375,753
Overdue by:    
0 to 30 days - -
31 to 60 days - -
61 to 90 days - -
More than 90 days - -
Total trade and other receivables (gross) 4,216,071 3,375,753

Credit terms for goods and services were within 30 days (2014: 30 days).

Note 7: Non-Financial Assets

Note 7A: Reconciliation of the opening and closing balances of leasehold improvements, property, plant and equipment, and intangibles (2015)

   Plant and
equipment
$
Leasehold
improvements
$
Intangibles
$
Total
$
As at 1 July 2014        
Gross book value 34,382 156,274 - 190,656
Accumulated depreciation and impairment (14,023) (27,773) - (41,796)
Total as at 1 July 2014 20,359 128,501 - 148,860
Additions        
By purchase1 - - 256,098 256,098
Revaluations2 - (55,524) - (55,524)
Depreciation expense (6,695) (28,029) (8,537) (43,261)
Asset write-downs - - - -
Disposals:        
Other disposals - - - -
Total as at 30 June 2015 13,664 44,948 247,561 306,173
         
Total as at 30 June 2015 represented by:        
Gross book value 34,382 63,304 256,098 353,784
Accumulated depreciation and impairment (20,718) (18,356) (8,537) (47,611)
Total as at 30 June 2015 13,664 44,948 247,561 306,173

1. This reflects the establishment of Tax Complaints Handling software.

2. Revaluation relates to the impairment of the underlying asset associated with de-recognition of the make-good provision.

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

No leasehold improvements, property, plant and equipment, and intangibles are expected to be sold or disposed of in the next 12 months.

All revaluations are independent and are conducted in accordance with the revaluation policy stated at Note 1.17.

Note 7A: Reconciliation of the opening and closing balances of leasehold improvements, property, plant and equipment, and intangibles (2014)

   Plant and
equipment
$
Leasehold
improvements
$
Intangibles
$
Total
$
As at 1 July 2013        
Gross book value 34,382 154,344 - 188,726
Accumulated depreciation and impairment - - - -
Total as at 1 July 2013 34,382 154,344 - 188,726
Additions        
By purchase - 1,930 - 1,930
Revaluations - - - -
Depreciation expense (14,023) (27,773) - (41,796)
Asset write-downs - - - -
Disposals:        
Other disposals - - - -
Total as at 30 June 2014 20,359 128,501 - 148,860
         
Total as at 30 June 2014 represented by:        
Gross book value 34,382 156,274 - 190,656
Accumulated depreciation and impairment (14,023) (27,773) - (41,796)
Total as at 30 June 2014 20,359 128,501 - 148,860

 

   2015
$
2014
$

Note 7B: Other non-financial assets

   
Prepayments 25,135 37,844
Total other non-financial assets 25,135 37,844
     
Other non-financial assets expected to be recovered    
No more than 12 months 25,135 37,844
Total other non-financial assets 25,135 37,844

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

Note 8: Payables

   2015
$
2014
$

Note 8A: Suppliers

   
Trade creditors 71,306 68,259
Total suppliers 71,306 68,259
     
Suppliers expected to be settled    
No more than 12 months 71,306 68,259
More than 12 months - -
Total suppliers 71,306 68,259
     
Suppliers in connection with    
Related parties 61,560 60,000
External parties 9,746 8,259
Total suppliers 71,306 68,259
Settlement is usually made within 30 days (2014: 30 days).

 

Note 8B: Other payables

Wages and salaries 49,067 45,535
Superannuation 6,535 6,090
Rent payable1 2,178 36,470
Total other payables 57,780 88,095
     
Other payables expected to be settled    
No more than 12 months 57,780 51,625
More than 12 months - 36,470
Total other payables 57,780 88,095

1. Rent payable has been remeasured as at 30 June 2015 to reflect the new expiry date of 31 August 2015 for the existing lease. Refer Note 2 for details of changes to lease arrangements.

Note 9: Provisions

   2015
$
2014
$

Note 9A: Employee provisions

   
Leave 489,466 427,726
Total employee provisions 489,466 427,726
     
Employee provisions expected to be settled    
No more than 12 months 216,375 163,157
More than 12 months 273,091 264,569
Total employee provisions 489,466 427,726

 

Note 9B: Other provisions

Provision for restoration obligations1 - 93,418
Total other provisions - 93,418
     
Other provisions expected to be settled    
More than 12 months - 93,418
Total other provisions - 93,418
     
Provision for restoration obligation    
Carrying amount 1 July 93,418 86,931
Re-statement of make-good (99,232) 3,730
Unwinding of discount or change in discount rate 5,814 2,757
Closing balance 30 June - 93,418

1. Provision for restoration of lease premises has been removed to reflect the change in lease arrangements. Refer Note 2 for details of changes to lease arrangements.

Note 10: Cash Flow Reconciliation

   2015
$
2014
$
Reconciliation of cash and cash equivalents as per Statement of Financial Position to Cash Flow Statement    
     
Cash and cash equivalents as per:    
Cash flow statement 113,832 45,019
Statement of financial position 113,832 45,019
Discrepancy - -
     
Reconciliation of net cost of services to net cash from operating activities:    
Net cost of services (2,492,086) (2,635,141)
Add: Revenue from Government 2,788,000 2,626,000
     
Adjustments for non-cash items    
Depreciation/amortisation 43,261 41,796
Finance costs 5,814 2,757
Re-measurement of lease payable1 47,555 -
     
Movements in assets and liabilities    
Assets    
(Increase)/decrease in net receivables (258,416) (332,149)
(Increase)/decrease in prepayments 12,709 (14,944)
Liabilities    
Increase/(decrease) in employee provisions 61,740 125,185
Increase/(decrease) in other payables (43,579) 37,154
Increase/(decrease) in supplier payables 3,047 40,825
increase/(decrease) in other provisions (99,232) -
Net cash from/(used by) operating activities 68,813 (108,517)

1. Rent payable has been remeasured as at 30 June 2015 to reflect the new expiry date of 31 August 2015 for the existing lease. Refer Note 2 for details of changes to lease arrangements.

 

Note 11: Contingent Assets and Liabilities

There are no unquantifiable or significant remote contingencies.

Note 12: Senior Management Personnel Remuneration

   2015
$
2014
$
Short-term employee benefits    
Salary 782,219 784,146
Allowances 1,814 1,214
Total short-term employee benefits 784,033 785,360
     
Post-employment benefits    
Superannuation 92,289 86,579
Total post-employment benefits 92,289 86,579
     
Other long-term benefits    
Annual leave accrued 69,314 67,200
Long-service leave 39,703 30,778
Total other long-term benefits 109,017 97,978
     
Total senior executive remuneration expenses 985,339 969,917

The total number of senior management personnel that are included in the above table are 3 (2014: 3).

Note 13: Financial Instruments

   2015
$
2014
$

Note 13A: Categories of financial instruments

   
Financial assets    
Loans and receivables    
Cash and cash equivalents 113,832 45,019
Total loans and receivables 113,832 45,019
Total financial assets 113,832 45,019
     
Financial liabilities    
Liabilities at amortised cost    
Payables — suppliers 71,306 68,259
Total liabilities at amortised cost 71,306 68,259
Total financial liabilities 71,306 68,259

There was no interest income from financial assets not at fair value through profit and loss in 2015 (2014: nil).

Note 13B: Fair value of financial instruments

        Notes Carrying
amount
2015
$
Fair
value
2015$
Carrying
amount
2014
$
Fair
value
2014
$
Financial assets          
Cash and cash equivalents   113,832 113,832 45,019 45,019
Total   113,832 113,832 45,019 45,019
           
Financial liabilities          
Suppliers payable 8A 71,306 71,306 68,259 68,259
Total   71,306 71,306 68,259 68,259

Note 13C: Credit risk

The entity is exposed to minimal credit risk as financial assets only include 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 (2015: $0 and 2014: $0). The entity has assessed the risk of default on payment and has made no allocations to doubtful debts in 2015 (2014: $0).

The following table illustrates the entity’s gross exposure to credit risk, excluding any collateral or credit enhancements

  2015
$
2014
$
Financial assets carried at amount not best representing maximum exposure to credit risk    
Cash and cash equivalents       113,832 45,019
Total financial assets carried at amount not best representing maximum exposure to credit risk 113,832 45,019
           
Financial liabilities carried at amount not best representing maximum exposure to credit risk    
Supplier payables       71,306 68,259
Total financial liabilities carried at amount not best representing maximum exposure to credit risk 71,306 68,259

The entity holds no collateral to mitigate against credit risk.

Credit quality of financial instruments not past due or individually determined as impaired
      Not past
due nor
impaired
2015
$
Not past
due nor
impaired
2014
$
Past due
or
impaired
2015
$
Past due
or
impaired
2014
$
Loans and receivables        
Cash and cash equivalents 113,832 45,019 - -
Total 113,832 45,019 - -

Note 13D: Liquidity risk

The entity’s financial liabilities are payables. The exposure to liquidity risk is based on the notion that the entity will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to the appropriation funding mechanisms available to the entity and internal policies and procedures put in place to ensure there are appropriate resources to meet its financial obligations. 

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

The entity had no derivative financial liabilities in either 2015 or 2014.

Maturities for non-derivative financial liabilities 2015
    On
demand
$
Within
1
year
$
1 to 2
years
$
2 to 5
years
$
> 5
years
$
 Total
$
Liabilities at amortised cost          
Payables — suppliers - 71,306 - - - 71,306
Total - 71,306 - - - 71,306
       
Maturities for non-derivative financial liabilities 2014    
    On
demand
$
Within 1
year
$
1 to 2
years
$
2 to 5
years
$
> 5
years
$
 Total
$
Liabilities at amortised cost          
Payables — suppliers - 68,259 - - - 68,259
Total - 68,259 - - - 68,259

 

Note 13E: Market risk

IGT holds basic financial instruments that do not expose it to certain market risks. The entity is not exposed to currency risk, other price risk, or interest rate risk.

Note 14: Financial Assets Reconciliation

    Notes 2015
$
2014
$
       
Total financial assets as per statement of financial position   4,329,903 3,420,772
Less: non-financial instrument components      
Appropriation receivables 6A 4,208,226 3,367,226
Other receivables 6A 7,845 8,527
Total non-financial instrument components   4,216,071 3,375,753
Total financial assets as per financial instruments note 13A 113,832 45,019

Note 15: Appropriations

 

Note 15A: Annual appropriations (‘recoverable GST exclusive’)
Annual appropriations for 2015

  Appropriation Act PGPA Act        
   Annual Appropriation
$
Section 74
$
Section 75
$
Total appropriation
$
Appropriation applied in 2015 (current and prior years)
$
Variance1$ Section 51 Determinations2
$
Departmental              
Ordinary annual services 3,359,000 644 - 3,359,644 (2,460,089) 899,555 (541,000)
Other Services              
Equity 808,000 - - 808,000 (256,098) 551,902 -
Total departmental 4,167,000 644 - 4,167,644 (2,716,187) 1,451,457 (541,000)

Notes:

1. Variance reflects the permanently withheld funding and lower than anticipated expenditure relating to the transfer of the tax complaint handling function from the Commonwealth Ombudsman.

2. The original budget provided for increased funding ($0.7 million) associated with the transfer of the tax complaint handling function from the Commonwealth Ombudsman. As at 30 June 2015, the legislation required to effect this change has not passed Parliament and as a result, the associated funding was permanently withheld ($0.5 million).

Annual appropriations for 2014

  Appropriation Act FMA Act      
   Annual Appropriation
$
Section 30
$
Section 31
$
Total appropriation
$
Appropriation applied in 2014 (current and prior years)
$
Variance1$
Departmental            
Ordinary annual services 2,656,000 - 4,704 2,660,704 (2,404,903) 255,801
Total departmental 2,656,000 - 4,704 2,660,704 (2,404,903) 255,801

Notes:

1. Variance due to lower than anticipated expenditure.

Note 15B: Departmental capital budgets (‘recoverable GST exclusive’)

       
     2014-15 Capital Budget Appropriations Capital Budget Appropriations applied in 2015 (current and prior years)  
Appropriation Act PGPA Act Total Capital Budget Appropriations
$
Payments for non-financial assets(b)
$
Payments for other purposes
$
Total payments
$
Variance
$
Annual Capital Budget
$
Section 75
$
Departmental
Ordinary annual services

Capital Budget(a)
  



30,000
  



-
  



30,000
  



-
  



-
  



-
  



30,000

Notes:

(a) Departmental Capital Budgets are appropriated through Appropriation Acts (No.1, 3, 5). They form part of ordinary annual services and are not separately identified in the Appropriation Acts. For more information on ordinary annual services appropriation, please see Table A: Annual appropriations.

(b) Payments made on non-financial assets include purchase of assets, expenditure on assets which has been capitalised, and costs incurred to make good an asset to its original condition.

     2013-14 Capital Budget Appropriations Capital Budget Appropriations applied in 2014
(current and prior years)
Variance
$
Appropriation Act FMA Act Total Capital Budget Appropriations
$
Payments for non-financial assets(b)
$
Payments for other purposes
$
Total payments
$
Annual Capital Budget
$
Section 32
$
Departmental
Ordinary annual services
Capital Budget(a)
  



30,000
  



-
  



30,000
  



1,930
  



55,484
  



57,414
  



(27,414)

Notes:

(a) Departmental Capital Budgets are appropriated through Appropriation Acts (No.1, 3, 5). They form part of ordinary annual services and are not separately identified in the Appropriation Acts. For more information on ordinary annual services appropriation, please see Table A: Annual appropriations.

(b) Payments made on non-financial assets include purchase of assets, expenditure on assets which has been capitalised, and costs incurred to make good an asset to its original condition.

 

Note 15C: Unspent annual appropriations (‘recoverable GST exclusive’)

  2015
$
2014
$
Departmental    
Appropriation Act (No. 1) 2012-13 30,000 719,226
Appropriation Act (No. 1) 2013-141,2 1,477,226 2,693,019
Appropriation Act (No. 1) 2014-151,3 2,803,930 -
Appropriation Act (No. 3) 2014-15 551,902 -
Total departmental 4,863,058 3,412,245

1. Cash held amounts (2015: $113,832, 2014: $45,019) are included in Appropriation Act (No. 1) for the relevant year.

2. Includes quarantined funds of $1,000.

3. Includes funds of $541,000 that have been permanently withheld under section 51 of the PGPA Act.

Note 16: Reporting of Outcomes

Note 16A: Net cost of outcome delivery

    Outcome 1
2015
$
2014
$
Departmental    
Expenses 2,690,686 2,723,487
Own-source income 60,000 55,000
Gains 138,600 33,346
Net cost/(contribution) of outcome delivery 2,492,086 2,635,141

Outcome 1 is described in Note 1.1. Net costs shown include intra-government costs that are eliminated in calculating the actual Budget outcome.

Note 17: Budgetary Reports and Explanations of Major Variances

Note 17A: Departmental budgetary reports

Statement of Comprehensive Income
for the period ended 30 June 2015

     Actual Budget estimate
 
2015
$
Original12015
$
Variance22015
$
NET COST OF SERVICES      
Expenses      
Employee benefits 1,774,824 2,436,000 (661,176)
Suppliers 866,787 893,000 (26,213)
Depreciation and amortisation 43,261 30,000 13,261
Finance costs 5,814 - 5,814
Total Expenses 2,690,686 3,359,000 (668,314)
       
LESS:      
Own-Source Income      
Own-source revenue      
ANAO audit services received free of charge 60,000 - 60,000
Total own-source revenue 60,000 - 60,000
Gains      
Resources received free of charge 39,368 - 39,368
Gains from reversal of make-good 99,232 - 99,232
Total gains 138,600 - 138,600
Total own-source income 198,600 - 198,600
Net cost of services (2,492,086) (3,359,000) 866,914
       
Revenue from Government 2,788,000 3,359,000 (571,000)
Surplus/(Deficit) attributable to the Australian Government 295,914 - 295,914
       
OTHER COMPREHENSIVE INCOME      
Items not subject to subsequent reclassification to net cost of services      
Changes in asset revaluation reserves (55,524) - (55,524)
Total other comprehensive income (55,524) - (55,524)
       
Total comprehensive income/(loss) attributable to the Australian Government 240,390 - 240,390

1. The IGT’s original budgeted financial statement that was first presented to Parliament in respect of the reporting period (i.e. from the IGT’s 2014-15 Portfolio Budget Statements (PBS)). The Budget is not audited.

2. Between the actual and original budgeted amounts for 2015. Explanations of major variances (that are greater than +/- 10% of the original budget for a line item and greater than +/- $0.2 million) are provided below.

 

 

Explanations of major variances Affected line items
The original budget provided for increased funding ($0.7 million) associated with the transfer of the Tax Complaints Handling function from the Commonwealth Ombudsman’s office to the IGT. As at 30 June 2015, the legislation required to effect this change has not passed Parliament and as a result, the associated funding was in large part reduced ($0.5 million). Employee benefits

Revenue from Government

Statement of Financial Position
for the period ended 30 June 2015

     Actual Budget estimate
 
2015
$
Original1
2015
$
Variance2
2015
$
ASSETS      
Financial assets      
Cash and cash equivalents 113,832 98,000 15,832
Trade and other receivables 4,216,071 3,071,000 1,145,071
Total financial assets 4,329,903 3,169,000 1,160,903
Non-financial assets      
Infrastructure, plant and equipment 58,612 188,000 (129,388)
Intangibles 247,561 - 247,561
Other non-financial assets 25,135 24,000 1,135
Total non-financial assets 331,308 212,000 119,308
Total assets 4,661,211 3,381,000 1,280,211
       
LIABILITIES      
Payables      
Suppliers 71,306 66,000 5,306
Other payables2 57,780 - 57,780
Total payables 129,086 66,000 63,086
Provisions      
Employee provisions 489,466 303,000 186,466
Other provisions - 87,000 (87,000)
Total provisions 489,466 390,000 99,466
Total liabilities 618,552 456,000 162,552
Net assets 4,042,659 2,925,000 1,117,659
       
EQUITY      
Contributed equity 975,573 90,000 885,573
Reserves 382,409 518,000 (135,591)
Retained surplus 2,684,677 2,317,000 367,677
Total equity 4,042,659 2,925,000 1,117,659
       

1. The IGT’s original budgeted financial statement that was first presented to Parliament in respect of the reporting period (i.e. from the IGT’s 2014-15 Portfolio Budget Statements (PBS)). The Budget is not audited.

2. Between the actual and original budgeted amounts for 2015. Explanations of major variances (that are greater than +/- 10% of the original budget for a line item and greater than +/- $0.2 million) are provided below.

Explanations of major variances Affected line items
Relative to the original budget, IGT received additional equity funding ($0.8 million) in the 2015-16 Budget to support the establishment of the Tax Complaints Handling function. A portion of this funding ($0.2 million) was used to develop the associated software. The remainder of the equity funding, along with the higher than expected operating surplus, resulted in appropriation receivables being higher than expected for 2014-15.

Trade and other receivables

Intangibles

Contributed equity

Retained surplus

Cash Flow Statement
for the period ended 30 June 2015

     Actual Budget estimate
 
2015
$
Original1
2015
$
Variance2
2015
$
OPERATING ACTIVITIES      
Cash received      
Appropriations 2,528,902 3,329,000 (800,098)
Net GST received 56,829 - 56,829
Total cash received 2,585,731 3,329,000 (743,269)
Cash used      
Employees 1,709,107 2,436,000 (726,893)
Suppliers 807,811 893,000 (85,189)
Total cash used 2,516,918 3,329,000 (812,082)
Net cash from (used by) operating activities 68,813 - 68,813
       
INVESTING ACTIVITIES      
Cash used      
Purchase of intangibles 256,098 30,000 226,098
Total cash used 256,098 30,000 226,098
Net cash from (used by) investing activities (256,098) (30,000) (226,098)
       
FINANCING ACTIVITIES      
Cash received      
Contributed equity 256,098 30,000 226,098
Total cash received 256,098 30,000 226,098
Net cash from (used by) financing activities 256,098 30,000 226,098
       
Net increase (decrease) in cash held 68,813 - 68,813
Cash at the beginning of the reporting period 45,019 98,000 (52,981)
Cash at the end of the reporting period 113,832 98,000 15,832
       

1. The IGT’s original budgeted financial statement that was first presented to Parliament in respect of the reporting period (i.e. from the IGT’s 2014 15 Portfolio Budget Statements (PBS)). The Budget is not audited.

2. Between the actual and original budgeted amounts for 2015. Explanations of major variances (that are greater than +/- 10% of the original budget for a line item and greater than +/- $0.2 million) are provided below.

Explanations of major variances Affected line items
The net change in cash during 2014-15 was $0.07 million higher than the balanced position in the original budget. The change was predominantly driven by the drawdown of funds on 30 June 2015 to meet payment requirements on 1 July 2015, which increased cash holdings at 30 June 2015. Net increase/(decrease) in cash