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Financial discussion

An overview of the Departments financial performance for the 2000-01 financial year is provided below. The Departments financial statements are set out at page XX and the resource summary of the Departments price of outputs and administered programs is provided at Appendix G.

Operating result

Departmental

Reduced operating surplus - down $9.8 million from 1999-2000 and from budget - due to increased expenses.

DOTARS incurred an operating surplus for 2000-01 of $14.7 million before allowing for the $27.3 million capital use charge (CUC) for assets employed. This outcome was $9.8 million less than the budget figure before CUC of $24.5million.

Table 13 - Summary of the 2000 -01 result in comparison with the 1999-2000 result and the 2000-01 budget.

	Result $000	Variation on 1999-2000 (%)	Budget $000	Variation on Budget (%)
Appropriation for Outputs	190 697	2	190 482	0
Other Revenues	20 583	40	10 773	91
Total Revenue	211 280	5	201 255	5
Employee Expenses	68 775	6	67 269	2
Supplier Expenses	86 221	6	93 677	-8
Other Expenses	41 602	35	15 801	163
Total Expenses	196 598	11	176 747	11
Operating Result	14 682	-40	24 508	-40

Revenue increased by 5 per cent from 1999-2000 due to		Total operating revenue of $211.3 million, up $9.3 million from 1999-2000 and $10 million from budget, consists of Government Appropriations of $190.7 million and own source revenue, comprising sales of goods and services and interest, of $20.6 million. Each of these revenue items increased over the previous financial year: Appropriation revenue increased by $3.5 million from 1999-2000 due to:

new measures, supplementation for Comcover and		- new funding for the Regional Solutions Program ($2.4 million); and - supplementation for Comcover payments in relation to insurable risks in the Australian Territories ($1.4 million).

interest, insurance recovery and proceeds from the disposal of assets		Other revenue increased by $5.8 million from 1999-2000 and $9.8 million from budget due largely to interest earned by DOTARS ($3.5 million), an insurance recovery for the Cocos (Keeling) Island power station fire ($2.5 million); and proceeds from the disposal of assets ($3.6 million).

Total Expenses increased by 11 per cent from 1999-2000 and budget due to the write-down of assets.		Total operating expenses of $196.4 million increased by 11 per cent from 1999-2000 and from budget as a result of the write down of assets ($16.1 million). The main items comprising total operating expenses are employee expenses ($68.8 million, up 2 per cent from budget) and payments to suppliers ($86.2 million, down 8 per cent from budget).

Administered

DOTARS administers programs on behalf of its Ministers with a budget of $2 781.9 million in 2000-01.

Table 14 - Summary of budget and actual expenses by appropriation.

Administered Appropriations	2000-01 Budget $000	2000-01 Actual Expenses $000
Appropriation Acts 1 & 3	303 670	530 047
Appropriation Acts 2 & 4	60 378	44 838
Special Appropriations	2 249 255	2 276 792
Special Accounts	168 587	235 041
Total Administered Expenses	2 781 890	3 086 718

Operating revenue increased by $86.2 million due to increased appropriation.		Total operating revenue for 2000-01 was $2 898.7 million, an increase of $86.2 million from budget. This is largely due to increased appropriation revenue, up $76.3 million to $2 657.6 million, for the introduction of new measures (funding for new measures totalled $167.1 million, of which $150 million related to the Roads to Recovery program). The increased appropriation for new measures was partially offset by the rephasing of funding for programs from 2000-01 to 2001-02 and later years.

Operating expenses increased due the write down of assets.		Total operating expenses of $3 086.7 million represented a $304.8 million increase against budget, due to a $542.9 million write-down of assets for the Australian National Railway Commission ($325 million), Federation Fund Projects ($164.8 million) and the Rural Transactions Centres Program ($52.6 million), and the introduction of new measures. This was offset by a reduction due to changes in timing of implementation and completion of programs in 2000-01 for which funds were rephased to 2001-02 and later years ($254.4 million).

Balance Sheet

Departmental

Net equity position decreased due an increase in liabilities.		The Departments net equity position reduced to $214.5 million, representing a decrease of $4.6 million from 1999-2000. The reduction was as a result of an increase in liabilities.

Total assets decreased marginally by $1.0 million.		Total assets remained virtually unchanged at $252.5 million, a $0.2 million reduction from 1999-2000. Land and buildings increased by $5.6 million and infrastructure, plant and equipment decreased by $6.8 million.

Figure 9 - Departmental Assets as at 30 June 2001.

Figure 9 - Departmental Assets as at 30 June 2001

Primary liability, employee entitlements, decreased to $22.8 million.

Total liabilities increased by $3.6 million from 1999-2000 to $38.0 million. The Departments primary liability continues to be employee provisions, as a result of accruing leave entitlements for staff. This liability decreased by $0.8 million to $22.8 million. The increase in liabilities is primarily due to increases in accrued supplier expenses ($4.3 million).

Administered

Total assets decreased by $197.6 million due to a decrease in investments.		Total administered assets decreased by $197.6 million from budget to $1 637.9 million, mostly due to a $326.6 million write-down of investments for the Australian National Railway Commission and a $85.2 million reduction in receivables due to a change in the accounting treatment for Special Accounts. These reductions were partially offset by a $207.8 million increase in other assets, primarily prepayments.

Total liabilities increased by $28.5 million due to an increase in grants and other payables.		Total administered liabilities were $157 million, representing an increase of $28.5 million against budget due to an increase in grants and other payables by administered programs.

Figure 10 - Administered Assets as at 30 June 2001.

Figure 10 - Administered Assets as at 30 June 2001

Cash flow statement

Departmental

Cash held increased marginally to $36.8 million.

DOTARS marginally increased its cash balance to $36.8 million during the year. This cash will be required to fund ongoing operating activities across DOTARS and the purchase of property, plant and equipment to maintain the delivery of services to the Indian Ocean Territories.

Figure 11 - Departmental Net Cash Flows

Figure 11 - Departmental Net Cash Flows

Administered

Cash held decreased by $23.9 million to $0.5 million.

The administered cash balance decreased by $23.9 million to $0.5 million, $0.1 million greater than budget, attributable to net cash outflows from operating activities of $24.8 million. Administered cash is held at year-end to acquit closing creditors due and payable early in the new financial year.

Figure 12 Administered Net Cash Flows

Figure 12 - Administered Net Cash Flows