Notes 17 to 24

​DEPARTMENT OF AGRICULTURE, FISHERIES AND FORESTRY
NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

for the period ended 30 June 2012

Note 17. Administered Expenses


2012 2011

$'000 $'000
Note 17A: Supplier    
Goods and services

Membership fees 10 643  13 152
Consultants 7 954  11 359
Contractors 1 311  5 069
Other 2 198  3 152
Total goods and services  22 106  32 732

Goods and services are made up of:


Provision of goods – related entities 95  680
Provision of goods – external parties  11 320 13 017
Rendering of services – related entities  6 987 7 740
Rendering of services - external parties  3 704 11 295
Total goods and services  22 106  32 732

Other supplier expenses


Operating lease rentals – external parties:

Minimum lease payments  10 125
Operating lease rentals - related parties:

Minimum lease payments - 17
Total other supplier expenses 10 142
Total supplier expenses  22 116  32 874

Note 17B: Personal Benefits


Direct:

Rural assistance 64 780  186 688
Total personal benefits  64 780  186 688

Note 17C: Grants


Public sector:

Australian Government entities (related entities) 32 130  18 200
State and Territory Governments 8 966  2 851
Local Governments  767  3 627
Private sector:

Non-profit organisations 448 357  433 152
For profit organisations 54 244  33 818
Other  326 552
Total grants  544 790  492 200

Note 17D: Write-Down and Impairment of Assets


Asset write-downs and impairments from:

Impairment on financial assets  816 502
Debt waiver - under Dairy Produce Act 1986  1 7
Debt waiver - under Primary Industries Levies and Charges Collection Act 1991  148 265
Total write-down and impairment of assets 965 774

Note 17E: Payments to CAC Act Bodies


Wine Australia Corporation (WAC) 5 547  5 373
Cotton Research and Development Corporation (CRDC) 16 536  9 464
Fisheries Research and Development Corporation (FRDC) 17 675  17 501
Grains Research and Development Corporation (GRDC) 156 338  159 855
Grape and Wine Research and Development Corporation (GWRDC) 21 766  24 773
Rural Industries Research and Development Corporation (RIRDC) 19 962  15 797
Sugar Research and Development Corporation (SRDC) 11 228  9 562
Total payments to CAC Act Bodies  249 052  242 325

Note 17F: Other Expenses


Act of Grace payments 1 573  -
Total other expenses  1 573  -

Note 18. Administered Income

OWN-SOURCE REVENUE 2012 2011

$'000 $'000
Taxation Revenue

Note 18A: Taxation Revenue

Primary industry levies and penalties 380 046  408 633
Primary industry charges and penalties 12 321  11 257
Total sale of goods and rendering of services  392 367  419 890

Non-Taxation Revenue


Note 18B: Other Revenue

Refunds of prior year payments 1 427 437
AQIS fees and charges  636 690
Refund of unspent National Landcare funds  72  4 921
War services land settlement scheme -  1 352
Other 1 325  1 275
Total other revenue  3 460  8 675

Note 19. Administered Financial Assets


2012 2011

$'000 $'000
Note 19A: Cash and Cash Equivalents

Cash on hand or on deposit  423 683
Total cash and cash equivalents 423 683
Note 19B: Trade and Other Receivables

Good and Services:

Taxes, levies, fees and charges  8 773  8 903
Goods and services - related entities  -  -
Goods and services - external parties 531 228
Total receivables for goods and services 9 304  9 131

Other receivables:


GST receivable from the Australian Taxation Office  8 645  8 252
Total other receivables 8 645  8 252
Total trade and other receivables (gross) 17 949  17 383

Less impairment allowance account:


Goods and services ( 1 551) ( 938)
Total impairment allowance account (1 551) ( 938)
Total trade and other receivables (net) 16 398  16 445

Receivables are expected to be recovered in:


No more than 12 months  16 398 16 445
More than 12 months  -  -
Total trade and other receivables (net) 16 398  16 445

Receivables are aged as follows:


Not overdue  12 135 12 658
Overdue by:

0 to 30 days  1 052  499
31 to 60 days 143  46
61 to 90 days 323  190
More than 90 days  4 296 3 990
Total receivables (gross) 17 949  17 383

The impairment allowance account is aged as follows:


Not overdue  -  -
Overdue by:

0 to 30 days  -  -
31 to 60 days  -  -
61 to 90 days  -  -
More than 90 days ( 1 551) ( 938)
Total impairment allowance account (1 551) ( 938)

Goods and services receivables are with entities external to the Australian Government. Credit terms were within 30 days (2011: 30 days).


Reconciliation of the Impairment Allowance Account:

Movements in relation to 2012
  Taxation
receivables
Advances and loans Other
receivables
Total

$'000 $'000 $'000 $'000
Opening balance ( 938)
 - ( 938)
Amounts written off 351  -  - 351
Decrease recognised in net surplus ( 964)  -  - ( 964)
Closing balance (1 551) - - (1 551)

Movements in relation to 2011
  Taxation
 receivables
Advances and loans Other
receivables
Total

$'000 $'000 $'000 $'000
Opening balance (1 914)  -  - ( 1 914)
Amounts written off 1 455  -  -  1 455
Decrease recognised in net surplus ( 479)  -  - ( 479)
Closing balance ( 938)  -  - ( 938)


2012 2011

$'000 $'000

Note 19C: Other Investments


Wine Australia Corporation (WAC)  2 035  3 343
Cotton Research and Development Corporation (CRDC)  27 317  15 595
Fisheries Research and Development Corporation (FRDC)  6 460  10 657
Grains Research and Development Corporation (GRDC)  162 229  149 793
Grape and Wine Research and Development Corporation (GWRDC)  6 376  6 012
Rural Industries Research and Development Corporation (RIRDC)  10 463  11 030
Sugar Research and Development Corporation (SRDC)  11 287  11 273
Total other investments 226 167  207 703

Total other investments are expected to be recovered in:


No more than 12 months  -  -
More than 12 months  226 167 207 703
Total other investments 226 167  207 703

Note 19D: Other Financial Assets


Accrued primary industry levies 57 068  71 945
Accrued primary industry charges 1 427  1 504
Total other financial assets  58 495  73 449



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

No more than 12 months  58 495 73 449
More than 12 months  -  -
Total other financial assets  58 495  73 449

Note 20. Administered Non-Financial Assets


2012 2011

$'000 $'000
Note 20A: Other Non-Financial Assets

Prepayments  555 528
Total other non-financial assets 555 528

No indications of impairment were found for other non-financial assets



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


No more than 12 months 555  528
More than 12 months  -  -
Total other non-financial assets 555 528

Note 21. Administered Payables


2012 2011

$'000 $'000
Note 21A: Suppliers

Trade creditors and accruals 6 713  7 577
Total supplier payables  6 713  7 577

Supplier payables expected to be settled within 12 months:


Related entities  -  24
External parties  6 713 7 553
Total  6 713  7 577

Total supplier payables
 6 713  7 577

No supplier payables are expected to be settled in greater than 12 months.

Settlement was usually made within 30 days.

Note 21B: Personal Benefits

Direct – Rural assistance 3 497  2 076
Total personal benefits  3 497  2 076

Total personal benefits are expected to be settled in:


No more than 12 months  3 497 2 076
More than 12 months  -  -
Total personal benefits  3 497  2 076

Note 21C: Grants


Public sector:

Australian Government entities (related entities)  28 000  20 666
State and Territory Governments  5 770 74
Local Governments 193  -
Private sector:

Non-profit organisations  45 243  46 470
Other  5 177 253
Total grants  84 383  67 463

Total grants are expected to be settled in:


No more than 12 months  84 383 67 463
More than 12 months  -  -
Total grants  84 383  67 463

Settlement is usually made according to the terms and conditions of each grant. This was usually within 30 days of performance or eligibility.

Note 21D: Other Payables

Other  6 9
Total other payables 6 9

Total other payables are expected to be settled in:


No more than 12 months 6  9
More than 12 months  -  -
Total other payables 6 9

Note 22. Administered Cash Flow Reconciliation


2012 2011

$'000 $'000
Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement


Cash and cash equivalents as per:


Schedule of administered cash flows 423  683
Schedule of administered assets and liabilities 423  683
Difference  -  -

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

Net cost of services ( 487 449) (526 296)

Changes in assets / liabilities


(Increase) / decrease in net receivables 47 ( 277)
(Increase) / decrease in other financial assets  14 954 (14 943)
(Increase) / decrease in other non-financial assets ( 27)  32
Decrease in supplier payables ( 864) (1 384)
Increase / (decrease) in personal benefits payable  1 421 (2 204)
Increase in grants payable  16 920 5 794
Increase / (decrease) in other payables ( 3)  3
Net cash from (used by) operating activities ( 455 001) ( 539 275)

Note 23. Administered Contingent Assets and Liabilities

Quantifiable Contingencies

There were no quantifiable administered contingent assets or liabilities at 30 June 2012 (30 June 2011: Nil).

Unquantifiable Contingencies

There were no unquantifiable administered contingent assets or liabilities at 30 June 2012 (30 June 2011: Nil).

Significant Remote Contingencies

The Australian Government encourages expenditure on research and development to increase the competitiveness and sustainability of industries within Australia. Under several Acts, the Commonwealth provides contributions to a number of nominated entities responsible for undertaking research and development activities in respect of portfolio industries. These contributions are typically made on a matching basis. Under legislation, entities are eligible for matching contributions which are subject to annual “caps” based on the total cumulative amount of levies collected, amounts spent on qualifying research and development and the annual level of the determined gross value of production. The operation of these annual caps can result in annual entitlements being limited to less than full cumulative levy collections and/or cumulative qualifying research and development expenditure. However, unpaid balances may still be claimable, depending on the level of the caps determined in future years and are therefore carried forward from year to year.

At 30 June 2012, the Commonwealth had a maximum potential liability in respect of matching payments of approximately $329 million (30 June 2011: $319 million). However, the Commonwealth's actual future liability is contingent on a combination of several currently indeterminate independent factors which are beyond the control of both the department and the recipient entities, in particular the future annual levels of levy collections and determined gross values of production. The likelihood of meeting the eligibility requirements and the amount of future payments is uncertain. Hence, this liability is considered to be both contingent and remote.

It is possible that legal action seeking compensation may be initiated in connection with the temporary suspension of live cattle exports to Indonesia in June 2011. This is considered to be a remote contingency that cannot be quantified.

The Australian Government, State and Territory Governments and peak livestock industry councils are parties to a cost sharing agreement (Emergency Animal Disease Response Agreement) that outlines how responses for emergency animal diseases will be funded. Under the terms of the agreement, the Commonwealth typically is liable for 50% of the funding to be provided by governments to manage a disease outbreak and may provide financial assistance to industry by funding their share of the response, which is subsequently recovered through a levy on the industry. Potential cost varies by response dependant on outbreaks of disease, the extent of outbreaks, frequency and location. However, each initial commitment to each response is capped at $2 million, after which point further budgetary authorisation is required. The last funded response from the Commonwealth was in 2007-08 (Equine Influenza) when the Commonwealth contributed $97.2 million to cover both industry and Commonwealth shares of the response.

The Australian Government, State and Territory Governments and peak livestock industry councils are parties to a cost sharing agreement (Emergency Plant Pest Response Deed) that outlines how emergency plant pest outbreaks will be funded. Under the terms of the agreement, the Commonwealth typically is liable for 50% of the funding to be provided by governments to manage a plant pest outbreak and may provide financial assistance to industry by funding their share of the response, which is subsequently recovered through a levy on the industry. Potential cost varies by response dependant on outbreaks of plant pest, the extent of outbreaks, frequency and location. However, each initial commitment to each response is capped at $2 million, after which point further budgetary authorisation is required. Previous responses to pest incursions have included papaya fruit fly, sugarcane smut and Siam weed.

The Australian Government and State and Territory Governments are parties to a cost sharing agreement (National Environmental Biosecurity Response Agreement) that outlines how responses to nationally significant biosecurity incidents with predominantly public benefits are funded. Under the terms of the agreement, the Commonwealth typically is liable for 50% of the funding to be provided to the State and Territory Governments to manage biosecurity incidents. The potential cost varies by response dependant on the extent, frequency and location of the biosecurity incident. However, the total commitment for the Commonwealth is capped at $2 million per annum, after which point further authorisation is required by the Minister. There have been no funded responses to date under this agreement.

There were no remote administered contingent assets at 30 June 2012 (30 June 2011: Nil).

Note 24. Administered Investments

Commonwealth Authority: Wine Australia Corporation (WAC)

Principal Activities: To build a more profitable wine industry by extending Australia’s fine wine presence and reputation globally, and by providing foundation data and market insights to Australian producers that deliver a competitive advantage.

Commonwealth Authority: Cotton Research and Development Corporation (CRDC)

Principal Activities: To create and promote the adoption of innovation to increase productivity, competitiveness and environmental sustainability that benefits the Australian cotton industry and wider community.

Commonwealth Authority: Fisheries Research and Development Corporation (FRDC)

Principal Activities: To maximise economic, environmental and social benefits for its stakeholders through effective investment and partnership in research and development.

Commonwealth Authority: Grains Research and Development Corporation (GRDC)

Principal Activities: To support effective competition by Australian grain growers in global grain markets, through enhanced profitability and sustainability.

Commonwealth Authority: Grape and Wine Research and Development Corporation (GWRDC)

Principal Activities: To generate new information that enhances the profitability, international competitiveness and sustainability of the Australian wine industry through investment in research and development.

Commonwealth Authority: Rural Industries Research and Development Corporation (RIRDC)

Principal Activities: To foster sustainable, productive and profitable new and existing rural industries and further understanding of national rural issues through research and development in government-industry partnership.

Commonwealth Authority: Sugar Research and Development Corporation (SRDC)

Principal Activities: To provide economic, environmental and social benefits for rural and regional communities through targeted investment in research and development.

Last reviewed: 4 November 2019
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