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Financial Statements

Independent Audit Report

To the Minister for Transport and Regional Services

Scope

I have audited the financial statements of the Department of Transport and Regional Services for the year ending 30 June 1999. The financial statements comprise:

Statement by the Chief Executive
Agency and Administered statements of:
- Revenues and Expenses
- Assets and Liabilities
- Revenues and Expenses by Program
- Cash Flows
Schedule of Commitments
Schedule of Contingencies
Notes to and forming part of the Financial Statements.

The Department's Chief Executive is responsible for the preparation and presentation of the financial statements and the information they contain. I have conducted an independent audit of the financial statements in order to express an opinion on them to you.

The audit has been conducted in accordance with the Australian National Audit Office Auditing Standards, which incorporate the Australian Ausditing Standards, to provide reasonable assurance as to whether the financial statements are free of material misstatement. Audit procedures included examination, on a test basis, of evidence supporting the amounts and other disclosures in the financial statements, and the evaluation of accounting policies and significant accounting estimates. These procedures have been undertaken to form an opinion as to whether, in all material respects, the financial statements are presented fairly in accordance with Australian Accounting Standards, other mandatory preofessional reporting requirements and statutory requirements so as to present a view of the Department which is consistent with my understanding of its financial position, its operations and its cash flows.

The audit opinion expressed in this report has been formed on the above basis.

Audit Opinion

In my opinion,

the financial statements have been prepared in accordance with Schedule 2 of the Finance Minister's Orders

the financial statements give a true and fair view, in accordance with applicable Accounting Standards, other mandatory prefessional reporting requirements and Schedule 2 of the F9inance Minister's Orders, of the financial position of the Department of Transport and Regional Services as at 30 June 1999 and the results of its operations and its cash flows for the year then ended.

Australian National Audit Office

Lynne O'Brien
Executive Director
Delegate of the Auditor-General

Canberra
24 September 1999

Statement by the Chief Executive

In my opinion, the attached financial statements give a true and fair view of the matters required by Schedule 2 to the Finance Minister's Orders made under section 63 of the Financial Management and Accountability Act 1997.

Allan Hawke
Chief Executive

24 September 1999

Agency Revenues and Expenses

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES AGENCY REVENUES AND EXPENSES for the year ended 30 June 1999

			1998-99	1997-98
		Notes	$'000	$'000

NET COST OF SERVICES

Expenses
	Employees	4A	53 808	49 492
	Suppliers	4B	87 693	67 145
	Depreciation and amortisation	4C	25 746	17 191
	Write down of assets	4E	1 540	1 099
	Net losses from sale of assets	4G	517	549

Total expenses			169 305	135 477
Revenues from independent sources
	Sales of goods and services		7 523	7 810
	Reversals of previous asset write-downs		-	11
Total revenues from independent sources			7 523	7 821

Net cost of services			161 781	127 656

REVENUES FROM GOVERNMENT

	Appropriations used for:
	Ordinary annual services (net appropriations)	2.4, 21	125 803	113 204
	Other services		11 130	7 413
	Resources received free of charge	5	592	203
Total revenues from government			137 525	120 821

	Operating result before extraordinary items		(24 256)	(6 836)

	Net revenues or expenses from extraordinary items:
	Restructuring	7A	( 1 210)	221 184

	Operating surplus		( 25 466)	214 349

	Accumulated results at 1 July		216 152	1 803

	Accumulated results at 30 June		190 685	216 152

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

Administered Revenues and Expenses

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES ADMINISTERED REVENUES AND EXPENSES for the year ended 30 June 1999

				1998-99	1997-98
			Notes	$'000	$'000

REVENUES

	TAXATION
		Levies, fees and fines	9	111 906	77 033
	Total taxation			111 906	77 033
	NON-TAXATION
		Sales of goods and services		7 867	7 251
		Interest and dividends	10A	69 364	97 495
		AWDC Land Sales		10 200	11 000
		Other		28 783	5 117
	Total non-taxation			116 214	120 863

Total revenues				228 120	197 896

EXPENSES
		Subsidies		38 349	22 123
		Grants	6	2 404 641	1 101 179
		Depreciation and amortisation	4D	369	69
		Net write down of assets	4F	3 149	727
		Net losses from sale of assets	4H	1 260	60
		Goods & Services		65 667	69 226
		Other		-	266
Total expenses				2 513 435	1 193 650

		Net cost to government		(2 285 316)	(995 756)

TRANSFERS

		Special Appropriations Accrued		114 705	-
		Cash from Official Commonwealth Public Account		2 471 459	2 120 692
		Cash from other Government Department		230 450	-
		Cash to Official Commonwealth Public Account		(362 152)	(203 033)

		Net change in administered assets before		169 147	921 903
		extraordinary items
		Restructuring	7B	63 699	(835 539)


		Net change in administered assets		232 845	86 364

		Transfers from Reserves	8A	( 300 596)	126 229
		Accumulated results at 1 July		379 990	255 302
		Prior period adjustments	8B	308 962	(87 906)

		Accumulated results at 30 June		621 201	379 990


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

Agency Assets and Liabilities

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES AGENCY ASSETS AND LIABILITIES as at 30 June 1999

			1998-99	1997-98
		Notes	$'000	$'000

DEBT
	Other	11A	14	352
Total debt			14	352

PROVISIONS AND PAYABLES
	Employees	12A	21 110	18 312
	Suppliers	12B	2 650	2 658
	Other	12C	93	154
Total provisions and payables			23 853	21 123

EQUITY
	Accumulated results		190 685	216 152
	Capital		11 974	-
	Reserves		17 371	16 112
Total equity		13A	220 030	232 265
	Total liabilities and equity		243 898	253 739

FINANCIAL ASSETS
	Cash		770	413
	Receivables	14B	13 222	10 596
Total financial assets			13 993	11 009

NON-FINANCIAL ASSETS
	Land and buildings	15A, G	98 430	102 174
	Infrastructure, plant and equipment	15C, G	119 939	128 637
	Inventories	15I	2 613	3 196
	Intangibles	15E, G	3 116	469
	Other	15K	5 807	8 255
Total non-financial assets			229 905	242 730

	Total assets		243 898	253 739

Current liabilities			11 765	10 834
Non-current liabilities			12 102	10 642

Current assets			21 496	21 384
Non-current assets			222 402	232 356

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

Administered Assets and Liabilities

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES ADMINISTERED ASSETS AND LIABILITIES as at 30 June 1999

			1998-99	1997-98
		Notes	$'000	$'000

DEBT
	Loans	11B, 8B	0	297 106
Total debt				297 106

PROVISIONS AND PAYABLES
	Subsidies		2 030	190
	Grants	12D	117 577	3 328
	Other	12E	7 607	9 906
Total provisions and payables			127 213	13 424

EQUITY
	Accumulated results		621 201	379 990
	Capital		8 388	-
	Reserves		1 259 166	2 131 586
Total equity		13B	1 888 755	2 511 576
	Total liabilities and equity		2 015 968	2 822 106

FINANCIAL ASSETS
	Cash	14A	636	326
	Receivables	14C	337 572	311 984
	Investments	14D	1 533 105	2 456 040
	Accrued revenues	14E	4 723	4 646
Total financial assets			1 876 035	2 772 996

NON-FINANCIAL ASSETS
	Land and Buildings	15B, H	52 459	45 279
	Infrastructure, plant and equipment	15D, H	8	8
	Intangibles	15F, H	7 381	3 148
	Inventories	15J	376	-
	Other	15L	79 709	675
Total non-financial assets			139 933	49 110

	Total assets		2 015 968	2 822 106


Current liabilities			15 213	21 076
Non-current liabilities			112 000	289 454

Current assets			468 090	29 737
Non-current assets			1 547 878	2 792 369


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

Agency Revenues and Expenses by Program

This section contains a large table and is therefore presented in PDF format [ PDF PDF: 134 KB]

Agency Cash Flows

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES AGENCY CASH FLOWS for the year ended 30 June 1999

		1998-99	1997-98
	Notes	$'000	$'000
OPERATING ACTIVITIES
Cash received
Appropriation revenue		145 407	122 508
Sales of goods and services		7 775	7 388

Total cash received		153 182	129 897
Cash used
Employees		52 365	49 445
Suppliers		83 859	70 616

Total cash used		136 224	120 061

Net cash from operating activities	16A	16 958	9 835

INVESTING ACTIVITIES
Cash received
Proceeds from the sale of property, plant and equipment		570	1 106

Total cash received		570	1 106
Cash used
Purchases of property, plant and equipment		17 171	10 558

Total cash used		17 171	10 558

Net cash from (used by) investing activities		( 16 601)	(9 452)

Net increase/(decrease) in cash held		357	383
add cash at 1 July		413	30
Cash at 30 June		770	413

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

Administered Cash Flows

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES ADMINISTERED CASH FLOWS for the year ended 30 June 1999
		1998-99	1997-98
OPERATING ACTIVITIES	Notes	$'000	$'000
Cash received
TAXATION
Other taxes, fees and fines		102 950	76 633
Total taxation		102 950	76 633

NON-TAXATION
Sales of goods and services		7 770	7 098
Interest and dividends		69 686	98 885
Other non-taxation revenues		33 781	18 933
Cash from Official Commonwealth Public Account		2 471 460	2 117 772
Total non-taxation		2 582 697	2 242 688

Total cash received		2 685 647	2 319 322

Cash used
Subsidies		36 509	22 031
Grants		2 357 235	2 027 660
Other		67 932	68 073
Cash to Official Commonwealth Public Account		362 152	203 033

Total cash used		2 823 828	2 320 797

Net cash from operating activities	16B	(138 181)	(1 476)

INVESTING ACTIVITIES
Cash received
Proceeds from sales of property, plant and equipment		-	1 389
Equity repayments		31 073	-
Repayment of loans		107 556	45 987
Cash from other Department		230 450	-
Cash from Official Commonwealth Public Account		-	2 920
		369 079
Total cash received			50 296

Cash used
Equity payment		-	-
Purchase of property, plant and equipment		-	1 360
On lending of funds		588	-
Purchase of investments		230 000	1 560
Repayment to Official Commonwealth Public Account		-	45 987
Cash to Official Commonwealth Public Account		-	-

Total cash used		230 588	48 907

Net cash from (used by) investing activities		138 491	1 389

Net (decrease) increase in cash held		310	(87)
add cash at 1 July		326	413
Cash at 30 June		636	326


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

Schedule of Commitments

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES SCHEDULE OF COMMITMENTS as at 30 June 1999

		Agency		Administered
		1998-99	1997-98	1998-99	1997-98
		$'000	$'000	$'000	$'000
BY TYPE

CAPITAL COMMITMENTS
	Land and buildings	-	88	-	-
	Infrastructure, plant and equipment	-	13 213	-	-
	Other capital commitments	773	1 106	-	-

Total capital commitments		773	14 407	-	-

OTHER COMMITMENTS
	Operating leases	12 882	21 964	-	-
	Project commitments	304	160	3 208 340	2 149 064
	Research and development	-	-	-	275
	Other commitments	31 784	10 929	23 453	64 906

Total other commitments		44 970	33 053	3 231 793	2 214 245

COMMITMENTS RECEIVABLE		-	-	-	-

	Net commitments	45 743	47 460	3 231 793	2 214 245


BY MATURITY

All net commitments

	One year or less	16 934	29 808	795 638	595 721
	From one to two years	9 797	10 584	850 415	478 244
	From two to five years	19 011	6 889	1 585 740	910 330
	Over five years	-	179	-	229 950

Net commitments		45 742	47 460	3 231 793	2 214 245

Operating Lease Commitments

	One year or less	6 731	7 929	-	-
	From one to two years	4 133	6 987	-	-
	From two to five years	2 018	6 869	-	-
	Over five years	-	179	-	-

Net commitments		12 882	21 964	-	-


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

Schedule of Contingencies

DEPARTMENT OF TRANSPORT AND REGIONAL SERVICES SCHEDULE OF CONTINGENCIES as at 30 June 1999

			Agency		Administered
			1998-99	1997-98	1998-99	1997-98
			$'000	$'000	$'000	$'000

	CONTINGENT LOSSES

		Claims for damages / costs1,2	15,220	9,472	33,963	44,535
		Other3	0	0	2,000	1,517

		Total Contingent Losses	15,220	9,472	35,963	46,052

	CONTINGENT GAINS		150	0	0	0

		Net Contingencies	15,070	9,472	35,963	46,052


		Remote contingencies are disclosed in Note 17

Details

1 This amount represents an estimate of the Department's liability based on precedent cases. The Department is
defending the claims.
2 This amount includes compensation claims relating to a number of properties acquired for the proposed second
Sydney Airport at Badgerys Creek, under the Land Acquisitions Act 1989. Potential liabilities are estimated
at $33 963 000.
3 This amount includes the Commonwealth having assumed responsibility for all remaining assets, liabilities and
contracts of the Federal Airports Corporation upon its wind-up. Unpresented cheques of $2 million have been
identified and provided for. There is no basis for quantifying any potential claims beyond this amount.

Schedule of Unquantifiable Contingencies

SCHEDULE OF UNQUANTIFIABLE CONTINGENCIES
Departmental

As at 30 June 1999 the Commonwealth is party to ongoing funding agreements with the Australian Capital Territory (assistance for water and sewerage, and compensation for national capital influences), the Christmas Island Shire Council (financial assistance) and the Cocos (Keeling) Islands Shire Council (financial assistance). The future liabilities of these agreements cannot be reliably measured.

Administered

Federal Airports Corporation (FAC) - transfer of former contingent liabilities to the Commonwealth

As part of the wind-up of the FAC, the Commonwealth assumed responsibility on 1 July 1998 for a contingent liability of the Corporation which relates to debtors of the FAC who are challenging the validity of network charges made under the Federal Airports Corporation Act 1986. If the network charging approach is found to be invalid, this raises the prospect of further claims from other airport users who have previously paid network based charges to the Corporation. There is no basis for quantifying potential claims.

Stevedoring Industry Finance Committee (SIFC)

The Stevedoring Industry Finance Committee (SIFC) has 18 claims for asbestos related damage awaiting High Court decision. These claims were inherited from the Australian Stevedoring Industry Authority. Costs that may arise from these claims can not be determined and are therefore unquantifiable. Any future claims made resulting from the High Court's decision are also unquantifiable.

Australian Maritime Safety Authority (AMSA) - in relation to ship-sourced marine pollution

In the normal course of operations, the Authority is responsible for the provision of funds necessary to meet the clean-up costs arising from ship-sourced marine pollution. The Commonwealth has agreed that the Authority's responsibility be limited to a maximum outlay of $10 million. The Authority entered into a stand-by loan facility for this purpose. In the event of costs above that limit, funds will be provided by the Commonwealth. The Commonwealth's risk is unquantifiable. In all circumstances, the Authority is responsible for making appropriate efforts to recover the costs of any such incidents.


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