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Publications ~ Annual Report 2006

Notes to the financial statements
for the year ended 30 June 2006

Note 1: Budget composition

 

		Note	30.6.06 Budget Forecast $000	30.6.06 Supplementary Estimates Changes $000	30.6.06 Final Budget Total $000
Revenue	Crown	2	13,414	319	13,733
	Other	3	58	-	58
	Total revenue		13,472	319	13,791
Expenditure	Personnel		9,340	390	9,730
	Operating	5	3,707	(46)	3,661
	Depreciation	6	330	(25)	305
	Capital charge	7	67	-	67
	Total expenses		13,444	319	13,763
Net surplus			28	-	28

 

Note 2: Revenue-Crown

This is revenue earned for the supply of outputs to the Crown.

 

Note 3: Other revenue

 

	30.6.05 Actual $000	30.6.06 Actual $000	30.6.06 Main Estimates $000	30.6.06 Supplementary Estimates $000
Rental income	54	63	58	58
Gain on sale of fixed assets	37	2	-	-
Total other revenue	91	65	58	58

 

Note 4: Employee remuneration of more than $100,000 per annum

 

Remuneration Band	30.6.05 Number of Staff	30.6.06 Number of Staff
$100,001 - $110,000	3	3
$110,001 - $120,000	3	1
$120,001 - $130,000	-	3
$130,001 - $140,000	3	2
$140,001 - $150,000	1	4
$150,001 - $160,000	3	2
$160,001 - $170,000	3	1
$170,001 - $180,000	1	1
$180,001-$190,000	-	1
$190,001 and above	-	2

The Chief Executive’s remuneration is excluded as it is reported by the State Services Commissioner.

 

Note 5: Operating expenses

 

	30.6.05 Actual $000	30.6.06 Actual $000	30.6.06 Main Estimates $000	30.6.06 Supplementary Estimates $000
Audit fees for audit of financial statements	35	42	42	42
Premises rental	427	400	400	400
Contract for photocopying services	118	69	100	80

The premises rental expenses do not include accommodation costs for personnel located on two floors of the Beehive (estimated annual rental for the furnished accommodation of $350,000) which are provided by The Parliamentary Service.

 

Note 6: Depreciation

 

	30.6.05 Actual $000	30.6.06 Actual $000	30.6.06 Main Estimates $000	30.6.06 Supplementary Estimates $000
Fixtures & fittings	74	15	15	15
Furniture	16	87	70	87
Office equipment	14	13	-	10
Motor vehicles	19	14	13	15
Plant & equipment	27	42	20	40
IT equipment	133	120	212	133
Kitchen equipment	10	8	-	5
Total depreciation	293	299	330	305

 

Note 7: Capital charge

 

The department pays a capital charge on its taxpayers’ funds at 30 June and 31 December each year.
The capital charge rate for the year ended 30 June 2006 was 8.0% (8.0% for 2005).

 

Note 8: Provision for repayment of surplus

 

	30.6.05 Actual $000	30.6.06 Actual $000
Current year net surplus/ (deficit)	1,000	106
Total provision for repayment of surplus	1000	106

 

Note 9: Debtors and receivables

 

	30.6.05 Actual $000	30.6.06 Actual $000
Debtor-Crown	1,454	-
Sundry receivable	65	16
Prepayments	13	13
Total debtors and prepayments	1,532	29

 

Note 10: Fixed assets

 

		30.6.05 Actual $000	30.6.06 Actual $000
Fixtures & fittings	At cost	866	886
	Accumulated depreciation	314	400
	Net book value	552	486
Furniture	At cost	237	263
	Accumulated depreciation	196	212
	Net book value	41	51
Office equipment	At cost	401	450
	Accumulated depreciation	370	383
	Net book value	31	67
Motor vehicles	At cost	139	139
	Accumulated depreciation	121	134
	Net book value	18	5
Plant & equipment	At cost	617	623
	Accumulated depreciation	462	503
	Net book value	155	120
IT equipment	At cost	2,407	2,462
	Accumulated depreciation	2,189	2,310
	Net book value	218	152
Kitchen equipment	At cost	122	122
	Accumulated depreciation	102	110
	Net book value	20	12
Ground improvements	At cost	20	20
	Accumulated depreciation	20	20
	Net book value	-	-
Total fixed assets	At cost	4,809	4,965
	Accumulated depreciation	3,774	4,072
	Net book value	1,035	893

 

Note 11: Creditors and payables

 

	30.6.05 Actual $000	30.6.06 Actual $000
Trade creditors	700	446
Fixed assets creditors	118	40
Accrued liabilities and provisions	968	620
Total creditors and payables	1,786	1,106

 

Note 12 Employee entitlements

 

		30.6.05 Actual $000	30.6.06 Actual $000
Non-current liabilities	Retirement leave	419	410
	Long-service leave	90	70
	Total	509	480
Current liabilities	Annual leave	394	387
	Long service leave	45	49
	Retirement leave	26	49
	Total	465	485
Total employee entitlements		974	965

 

Note 13: Financial instruments

 

The department is a party to financial arrangements as part of its everyday operations. These include instruments such as bank balance, investments, sundry receivables and trade creditors.

Credit risk

Credit risk is the risk that a third party will default on its obligations to the department, causing the department to incur a loss. In the normal course of its operations, the department incurs credit risk from sundry debtors and transactions with financial institutions and the New Zealand Debt Management Office (NZDMO).

The department does not require any collateral or security to support financial instruments with financial institutions it deals with, or with NZDMO, as these entities have high credit ratings. For other financial instruments, the department does not have significant concentrations of credit risk.

Fair value

The fair value of all financial instruments is equivalent to the carrying amount disclosed in the Statement of Financial Position. The department is not involved in any off-balance-sheet transactions.

Currency risk and interest rate risk

Currency risk is the risk that debtors and creditors due in foreign currency will fluctuate because of changes in foreign exchange rates.

Interest rate risk is the risk that the department’s return on the funds it has invested will fluctuate because of changes in market interest rates.

The department has no significant exposure to currency risk or interest rate risk on its financial instruments.

 

Note 14: Related party information

 

The department is a wholly owned entity of the Crown. The government significantly influences the roles of the department as well as its source of revenue.

The department undertakes transactions with other departments, Crown entities and and state-owned enterprises.

These transactions are carried out at an arm’s length basis and are not considered to be related-party transactions.

Apart from those transactions described above, the department has not entered into any related-party transactions.

 

Note 15: Major budget variations

 

D1-Policy Advice and Secretariat and Co-ordination Services

The appropriation for this output class increased by $260,000 in supplementary estimates for unexpected costs relating to the Taito Phillip Field inquiry, other legal expenses, and pandemic contingency planning.

Statement of Financial Performance for the year ended 30 June 2006

The variance between actual and budgeted operating costs was due to costs relating to the Taito Phillip Field inquiry.

Statement of Financial Position as at 30 June 2006

There is no debtor – Crown balance at 30.6.06 ($1.454 million as at 30.6.05). This is because of changes in the timing of disbursements.

 

Note 16: Progress toward adopting International Financial Reporting Standards

 

Full adoption of New Zealand equivalents to International Financial Reporting Standards (NZ IFRS) by departments will occur in the 2007/08 financial year. Therefore these financial statements are prepared under current New Zealand GAAP (Generally Accepted Accounting Practice).

Treasury is managing the adoption of NZ IFRS for the consolidated financial statements of the government reporting entity. Currently DPMC is undertaking a review of NZ IFRS accounting policies for the financial statements and the implementation guidelines developed by Treasury. The potential area of impact from adoption of NZ IFRS is minimal. At this time it is expected that the recognition requirements and classification and measurement choices in the financial instrument standard NZ IAS 39 are likely to have the greatest impact on reported results compared with current accounting policies.