Financial statement reporting format for Budget Papers
Queensland's Budget Papers contain financial statements that are prepared and presented under the Uniform Presentation Framework (UPF) of reporting as required under the Australian Loan Council arrangements. The primary objective of the UPF is to ensure federal, state and territory governments provide a common 'core' of financial information.
The Framework has recently been reviewed following the release in October 2007 of the Australian Accounting Standards Board’s (AASB) new accounting standard, AASB1049 Whole of Government and General Government Sector Financial Reporting.
The new standard aims to harmonise Government Finance Statistics (GFS) and Generally Accepted Accounting Principles (GAAP) with the objective of improving the clarity and transparency of government financial statements. Further details are provided in Chapter 9 of Budget Paper No. 2.
Operating statement
The operating statement shows the budgeted revenues and expenses and net operating balance for the current year's budget, estimated actuals, budget year and the projections for the following three outyears.
Revenue from transactions
Taxation revenue
Includes duties, payroll, land and other taxes, fees, fire levy and community ambulance cover.
Grants revenue
Comprises revenues from the Australian Government - for example, general and specific purpose payments and grants for the community and industry.
Sales of goods and services
Fees and charges for services rendered and sale of goods.
Interest income
Includes interest accrued on investments, cash at bank, loans and advances. Interest revenue is largely derived from investment balances set aside for future employee entitlements, predominantly superannuation.
Dividend and income tax equivalents
Includes dividends and tax equivalent revenue accruing to the General Government sector from the Public Non-financial Corporation (PNFC)/Public Financial Corporation (PFC) sectors as well as other dividends.
Other revenue
Other income comprises royalties, fines and other sundry revenues.
Expenses from transactions
Employee expenses
Comprises wages, salaries and accruing leave costs for Government employees.
Superannuation expenses
Comprises current superannuation service cost expenses for Government employees, excluding superannuation interest expense.
Superannuation interest expense
Superannuation interest expense is the nominal superannuation expense imputed on the Government's accruing defined benefit superannuation liability. The expense is net of the actuarial return on plan assets.
Other operating expenses
Comprises the non-labour costs of providing supplies and services such as repairs and maintenance, consultancies and contractors, equipment, communications, marketing and other sundry expenses.
Depreciation and amortisation
An estimate of the progressive consumption of an asset through normal usage, wear and tear and obsolescence. It is a non-cash cost which reduces the value of an asset over time.
Other interest expenses
Interest paid by agencies on borrowings to acquire capital assets and infrastructure such as roads and buildings.
Grants expenses
Grants and subsidies paid to the community, such as schools, hospitals, benevolent institutions and local governments. Personal benefit payments and community service obligations payments made to Government-owned corporations are also classified as current transfer payments.
Net operating balance
The net operating balance is the surplus/(deficit) of revenues from transactions over expenditure from transactions.
Operating result
The operating result is calculated by adjusting the net operating balance for other economic flows relating to income and expenses, such as gains and losses, impairments and deferred tax revenue and expenses.
Comprehensive result
The comprehensive result adjusts the operating result for movements in equity such as revaluations and equity injections and withdrawals.
Net lending/(borrowing)
Net lending/(borrowing) is the net operating balance less the net acquisition of non-financial assets.
Balance sheet
The balance sheet shows the estimated assets, liabilities and net worth at year end for the current year's estimated actuals, budget year and the budgeted forecasts for the following three years.
Assets are classified into financial and non-financial assets. Financial assets are those that are generally readily realisable and include cash assets, investments and investments in public non-financial corporations. Non-financial assets are those assets that are not as liquid and include roads, schools, hospitals and other infrastructure. Non-financial assets also include prepayments and deferred tax assets.
Liabilities are amounts owed by the State, such as payables, borrowings and employee entitlements.
Net worth, or equity, of the State is the amount by which the State's assets exceed its liabilities.
Financial assets
Cash and deposits
Cash and assets readily convertible to cash - for example, deposits on call.
Advances paid
Loans for policy rather than liquidity management purposes.
Investments, loans and placements
Financial investments held to cover future medium and long-term liabilities (including employee entitlement liabilities such as superannuation) and loans and derivatives.
Receivables
Primarily includes short and long-term receivables, such as accounts receivable, grants and interest receivable.
Equity
Estimated net investment in public sector and other entities. The General Government sector holds the full equity of the State's public corporations, principally its shareholding in Government-owned corporations, similar to a holding company's investment in its subsidiaries.
Non-financial assets
Land and other fixed assets includes property, plant and equipment such as roads, schools, hospitals, land, inventories, other infrastructure and intangible assets. Other non-financial assets include prepayments and deferred tax assets.
Liabilities
Deposits held
Deposits from private sector or public sector entities.
Advances received
Loans from government authorities.
Borrowing
Includes loans, finance leases and derivatives.
Superannuation liability
The estimate of the State's defined benefit superannuation liability.
Other employee benefits
Includes liabilities for long service leave, annual leave and other employee entitlements.
Payables
Includes accounts payable, grants and interest payable.
Other liabilities
Includes general provisions for claims, and deferred tax liabilities.
Net worth
The amount by which the State's assets exceed its liabilities.
Net financial worth
The amount by which total financial assets exceed liabilities. It is a measure of net holdings of financial assets.
Net debt
Net debt equals sum of deposits held, advances received, government securities, loans and other borrowing less the sum of cash and deposits, advances paid and investments, loans and placements.
Net financial liabilities
Total liabilities less financial assets, other than equity in PNFCs and PFCs.
Cash flow statement
The cash flow statement identifies the estimated cash flows from the operating, investing and financing activities of the State and shows the budgeted cash surplus/(deficit) for the current year's estimated actuals, budget year and the projected forecasts for the following three out years.
The flows of cash are categorised into net cash inflows from operating activities, payments for investments in non-financial assets, payments for investment in financial assets for policy purposes, payments for investments in financial assets for liquidity purposes and receipts from financing activities.
Net cash inflows from operating activities
The net cash inflows from operating activities reflect the estimated cash receipts and payments from operating activities. It differs from the accrual basis of revenue and expenditure recognition contained in the operating statement. In addition, the timing of recognition of the accrual revenue or expense in the operating statement may differ from the actual cash disbursement or receipt.
Net cash flows from investments in non-financial assets
Investments in non-financial assets are those activities that relate to the acquisition and disposal of property, plant and equipment and other capital items. This investment reflects the Government's capital works program, which provides for services such as schools, hospitals and roads.
Net cash flows from investments in financial assets for policy purposes
Refers to cash flows from investments in financial assets for policy purposes by the Government and includes net equity injections into Government and other business enterprises and the net cash flows from disposal of Government business enterprises.
Net cash flows from investments in financial assets for liquidity purposes
Cash flows from investments for liquidity purposes represent net investment in financial assets such as investments held to cover superannuation and other employee entitlements, as well as other liquid assets.
Receipts from financing activities
Cash flows from financing activities include cash flows from net borrowings (increase in borrowings less redemptions), net advances (gross investment in new loans less redemption of loans issued), dividends paid and other financing (net movement in Government securities on issue).
Net increase/decrease in cash held
Reflects the net cash flow of the Government at year end and reconciles to the movement in cash balances between years on the balance sheet.
Cash Surplus/(deficit)
The cash surplus/(deficit) measure is comprised of the net cash flow from operating activities plus the net cash flow from investment in non-financial assets. It provides an indication of the net purchases of goods and services and net expenditure on capital works projects.
ABS GFS Cash Surplus/(deficit)
Cash surplus/(deficit) less value of finance leases entered into.
Last reviewed 5 June 2008
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