Australian Government General Government Sector Monthly Financial Statements July and August 2015

Senator the Hon Mathias Cormann
Minister for Finance

MC 51/15
Friday, 16 October 2015

Australian Government General Government Sector Monthly Financial Statements
July and August 2015

Key Points

The underlying cash balance for the 2015-16 financial year to 31 August 2015 was a deficit of $13,534 million.
The fiscal balance for the 2015-16 financial year to 31 August 2015 was a deficit of $11,643 million.

AGGREGATES	ACTUAL 2015-2016 July $m	ACTUAL 2015-2016 August $m	ACTUAL 2015-2016 YTD August $m	Budget Profile 2015-2016 YTD August $m	BUDGET ESTIMATE* 2015-2016 Full Year $m
Revenue	33,545	27,569	61,113	63,336	405,350
Expenses	39,313	34,181	73,495	73,559	434,469
Net operating balance	-5,768	-6,613	-12,381	-10,223	-29,118
Net capital investment	-501	-237	-739	62	3,854
Fiscal balance	-5,267	-6,376	-11,643	-10,286	-32,972
Receipts(a)	33,805	26,554	60,359	61,740	397,980
Payments(b)	41,239	32,147	73,387	74,112	429,836
Net Future Fund earnings	260	247	507	777	3,258
Underlying cash balance(c)	-7,694	-5,840	-13,534	-13,149	-35,115
Headline cash balance	-8,852	-5,996	-14,848	-14,401	-44,764
Total assets	440,918		439,720		454,695
Total liabilities	750,676		760,274		716,135
Net worth(d)	-309,758		-320,554		-261,440
Net debt(e)	249,029		256,256		285,802

_{*As published in the 2015-16 Budget.

(a) Cash receipts for operating activities and sales of non-financial assets.

(b) Cash payments for operating activities, purchases of non-financial assets and net acquisition of assets under finance leases.

(c) Excludes net Future Fund earnings. Consistent with Budget documents, the net adjustment for the Future Fund is shown separately.

(d) Net worth is calculated as total assets minus total liabilities.

(e) Net debt equals the sum of deposits held, government securities, loans and other borrowing, minus the sum of cash and deposits, advances paid, and investments, loans and placements.}

Care needs to be taken when comparing monthly or cumulative data across years and to full-year estimates, as revenues and expenses vary from month to month.

FISCAL OUTCOMES

Underlying Cash Balance

The underlying cash balance for the year to 31 August 2015 was a deficit of $13,534 million, compared to the 2015-16 Budget profile deficit of $13,149 million. The difference of $385 million relates to lower than expected cash receipts, partially offset by lower than expected cash payments.

Fiscal Balance

The fiscal balance for the year to 31 August 2015 was a deficit of $11,643 million, compared to the Budget profile deficit of $10,286 million. The difference of $1,357 million is largely due to lower than expected revenues.

Revenues
Total revenue was $2,223 million lower than the Budget profile, primarily due to lower than expected taxation and dividend revenue.
Expenses
Total expenses were $64 million lower than the Budget profile, primarily due to lower than expected wages and salaries expenses and other capital grant expenses, partially offset by higher than expected personal benefit expenses.

Assets and Liabilities

As at 31 August 2015:

Net worth is negative $320,554 million;
Net debt is $256,256 million; and
Net financial liabilities are $480,320 million.

Senator the Hon Mathias Cormann Minister for Finance 16 October 2015	Jane Halton Secretary of the Department of Finance 16 October 2015
Contact: Senator the Hon Mathias Cormann's Office: Department of Finance:	Karen Wu (02) 6277 7400 Amelia Gard (02) 6215 2222

Australian Government general government sector operating statement

	Note	ACTUAL 2015-2016 July $m	ACTUAL 2015-2016 August $m	ACTUAL 2015-2016 YTD August $m	Budget Profile 2015-2016 YTD August $m	BUDGET ESTIMATE* 2015-2016 Full Year $m
Revenue
Taxation revenue	1, 2	31,791	25,877	57,668	58,766	380,074
Sales of goods and services		917	757	1,674	1,545	9,542
Interest income		294	273	567	834	4,083
Dividend income		139	305	443	1,120	3,143
Other		404	356	760	1,070	8,508
Total revenue		33,545	27,569	61,113	63,336	405,350
Expenses
Gross operating expenses
Wages and salaries(a)		1,597	1,530	3,128	3,432	19,801
Superannuation		470	519	989	792	4,760
Depreciation and amortisation		603	650	1,253	1,190	7,182
Supply of goods and services		6,837	7,034	13,871	14,118	85,046
Other operating expenses(a)		558	488	1,046	953	5,510
Total gross operating expenses		10,065	10,221	20,286	20,485	122,298
Superannuation interest expense		771	771	1,541	1,645	9,869
Interest expenses		1,349	1,354	2,703	2,743	17,270
Current transfers
Current grants		11,872	8,869	20,741	20,816	128,415
Subsidy expenses		1,013	1,010	2,022	2,038	12,654
Personal benefits		13,491	11,220	24,711	24,028	133,123
Total current transfers		26,376	21,098	47,474	46,882	274,191
Capital transfers
Mutually agreed write-downs		171	167	338	347	2,199
Other capital grants		583	570	1,153	1,457	8,641
Total capital transfers		753	738	1,491	1,804	10,840
Total expenses	3	39,313	34,181	73,495	73,559	434,469
Net operating balance		-5,768	-6,613	-12,381	-10,223	-29,118
Other economic flows
- included in operating result(b)
Net write-downs of assets (including bad and doubtful debts)		-395	-589	-984	-1,910	-8,638
Assets recognised for the first time		1	53	54	56	335
Liabilities recognised for the first time		0	0	0	0	0
Actuarial revaluations		0	0	0	0	0
Net foreign exchange gains		-1,055	-1,155	-2,211	46	46
Net swap interest received		-63	-169	-232	0	0
Market valuation of debt		-4,607	-1,900	-6,507	640	3,625
Other gains/(losses)		3,809	-178	3,630	1,701	5,604
Total other economic flows
- included in operating result		-2,311	-3,939	-6,250	533	972
Operating result		-8,079	-10,552	-18,631	-9,691	-28,147
Non-owner movements in equity(b)
Revaluation of equity investments(c)		13	0	12	643	-2,221
Actuarial revaluations		0	0	0	12	105
Other economic revaluations(d)		659	-244	415	-187	135
Total other economic flows - included in equity		671	-244	427	469	-1,981
Comprehensive result - Total change in net worth		-7,408	-10,796	-18,204	-9,222	-30,128
Net operating balance		-5,768	-6,613	-12,381	-10,223	-29,118
Net acquisition of non-financial assets
Purchases of non-financial assets		367	408	775	1,309	11,408
less Sales of non-financial assets		123	-14	109	91	491
less Depreciation		603	650	1,253	1,190	7,182
plus Change in inventories		-169	-21	-189	42	352
plus Other movements in non-financial assets		26	11	37	-8	-234
Total net acquisition of non-financial assets		-501	-237	-739	62	3,854
Fiscal balance (Net lending/borrowing)(e)		-5,267	-6,376	-11,643	-10,286	-32,972

_{*As published in the 2015-16 Budget.

(a) Consistent with Australian Bureau of Statistics' (ABS) Government Finance Statistics (GFS) classification, other employee related expenses are reported under other operating expenses. Total employee expenses equal wages and salaries plus other operating expenses.

(b) The presentation of other economic flows has changed to align more closely with Australian Accounting Standard AASB 1049.

(c) Reflects changes in the market valuation of investments and any revaluations at the point of disposal or sale.

(d) Largely reflects other revaluation of assets and liabilities.

(e) The term fiscal balance is not used by the ABS.}

Australian Government general government sector balance sheet

	ACTUAL as at 31 July 2015 $m	ACTUAL as at 31 August 2015 $m	BUDGET ESTIMATE * as at 30 June 2016 $m
Assets
Financial assets
Cash and deposits	3,214	2,966	3,435
Advances paid	47,142	47,362	52,901
Investments, loans and placements	137,681	138,969	137,947
Other receivables	48,196	48,777	45,980
Equity investments
Investments in other public sector entities	41,364	41,598	45,471
Equity accounted investments	204	204	326
Investments - shares	44,892	41,676	46,537
Total financial assets	322,694	321,552	332,597
Non-financial assets
Land	9,986	9,979	9,144
Buildings	25,598	25,594	26,927
Plant, equipment and infrastructure	56,034	56,032	59,766
Inventories	8,217	8,162	8,211
Intangibles	6,546	6,540	6,547
Investment property	201	202	195
Biological assets	45	43	36
Heritage and cultural assets	11,323	11,320	10,852
Assets held for sale	69	79	72
Other non-financial assets	205	216	348
Total non-financial assets	118,224	118,168	122,098
Total assets	440,918	439,720	454,695
Liabilities
Interest bearing liabilities
Deposits held	219	219	211
Government securities	423,623	432,068	464,298
Loans	11,565	11,608	14,148
Other borrowing	1,660	1,658	1,428
Total interest bearing liabilities	437,067	445,553	480,084
Provisions and payables
Superannuation liability(a)	248,840	249,549	173,921
Other employee liabilities	16,521	16,667	16,105
Suppliers payable	5,343	5,012	4,914
Personal benefits provisions and payable	12,050	12,414	12,826
Subsidies provisions and payable	4,752	4,607	4,854
Grants provisions and payable	10,608	10,485	8,472
Other provisions and payables	15,495	15,987	14,959
Total provisions and payables	313,609	314,721	236,051
Total liabilities	750,676	760,274	716,135
Net worth(b)	-309,758	-320,554	-261,440
Net financial worth(c)	-427,982	-438,722	-383,538
Net financial liabilities(d)	469,346	480,320	429,009
Net debt(e)	249,029	256,256	285,802

_{*As published in the 2015-16 Budget.

(a) For budget reporting purposes, a discount rate applied by actuaries in preparing Long Term Cost Reports is used to value the superannuation liability. This reduces the volatility in reported liabilities that would occur from year to year if the long-term government bond rate were used. Consistent with Australian Accounting Standards, the long-term government bond rate as at 30 June is used to calculate the superannuation liability for the purpose of actuals reporting.

(b) Net worth is calculated as total assets minus total liabilities.

(c) Net financial worth equals total financial assets minus total liabilities.

(d) Net financial liabilities equals total liabilities less financial assets other than investments in other public sector entities.

(e) Net debt equals the sum of deposits held, government securities, loans and other borrowing, minus the sum of cash and deposits, advances paid, and investments, loans and placements.}

Australian Government general government sector cash flow statement^(a)

	ACTUAL 2015-2016 July $m	ACTUAL 2015-2016 August $m	ACTUAL 2015-2016 YTD August $m	Budget Profile 2015-2016 YTD August $m	BUDGET ESTIMATE* 2015-2016 Full Year $m
Cash receipts from operating activities
Taxes received	31,612	24,830	56,441	56,259	370,140
Receipts from sales of goods and services	767	803	1,570	1,571	9,475
Interest receipts	302	197	499	718	3,334
Dividends and income tax equivalents	227	230	457	2,523	4,623
Other receipts	775	554	1,329	466	8,549
Total operating receipts	33,682	26,613	60,296	61,536	396,121
Cash payments for operating activities
Payments for employees	-2,660	-2,022	-4,682	-4,995	-27,891
Payments for goods and services	-6,973	-6,574	-13,547	-13,837	-85,076
Grants and subsidies paid	-13,694	-11,266	-24,960	-25,880	-150,792
Interest paid	-1,117	-633	-1,750	-2,074	-14,953
Personal benefit payments	-14,528	-10,932	-25,460	-25,321	-134,744
Other payments	-767	-676	-1,443	-681	-5,218
Total operating payments	-39,740	-32,102	-71,842	-72,789	-418,674
Net cash flows from operating activities	-6,058	-5,488	-11,547	-11,253	-22,553
Cash flows from investments in non-financial assets
Sales of non-financial assets	123	-59	63	204	1,859
Purchases of non-financial assets	-1,499	-45	-1,544	-1,323	-11,161
Net cash flows from investments in non-financial assets	-1,376	-105	-1,481	-1,119	-9,302
Net cash flows from investments in financial assets for policy purposes	-1,418	-403	-1,821	-2,029	-12,908
Cash flows from investments in financial assets for liquidity purposes
Increase in investments	-146	-201	-347	1,626	-3,129
Net cash flows from investments in financial assets for liquidity purposes	-146	-201	-347	1,626	-3,129
Cash flows from financing activities
Borrowing (net)	9,302	6,065	15,366	12,961	50,790
Other financing (net)	-349	-116	-465	-457	-2,608
Net cash flows from financing activities	8,952	5,949	14,901	12,504	48,182
Net increase/(decrease) in cash held	-46	-248	-294	-271	291
Net cash flows from operating activities and investments in non-financial assets (Surplus(+)/deficit(-))	-7,434	-5,593	-13,027	-12,372	-31,855
Finance leases and similar arrangements(b)	0	0	0	0	-2
GFS cash surplus(+)/deficit(-)	-7,434	-5,593	-13,027	-12,372	-31,856
less Net Future Fund earnings	260	247	507	777	3,258
Equals underlying cash balance(c)	-7,694	-5,840	-13,534	-13,149	-35,115
plus Net cash flows from investments in financial assets for policy purposes	-1,418	-403	-1,821	-2,029	-12,908
plus Net Future Fund earnings	260	247	507	777	3,258
Equals headline cash balance	-8,852	-5,996	-14,848	-14,401	-44,764

_{*As published in the 2015-16 Budget.

(a) A positive number denotes a cash inflow; a negative sign denotes a cash outflow.

(b) The acquisition of assets under finance leases decreases the underlying cash balance.The disposal of assets previously held under finance leases increases the underlying cash.

(c) The term underlying cash balance is not used by the Australian Bureau of Statistics.}

Note 1: Income Tax

	ACTUAL 2015-2016 July $m	ACTUAL 2015-2016 August $m	ACTUAL 2015-2016 YTD August $m	Budget Profile 2015-2016 YTD August $m	BUDGET ESTIMATE* 2015-2016 Full Year $m
Individuals and other withholding taxes
Gross income tax withholding	14,076	15,273	29,349	29,941	178,460
Gross other individuals	4,464	2,922	7,386	8,253	43,800
less Refunds	5,054	5,486	10,540	10,290	28,000
Total individuals and other withholding taxation	13,486	12,709	26,196	27,904	194,260
Company tax	6,721	4,255	10,976	9,979	69,800
Superannuation funds	1,358	435	1,793	2,127	9,180
Fringe benefits tax	909	60	969	1,061	5,020
Resource rent taxes	-5	190	186	401	1,420
Total income taxation revenue	22,469	17,650	40,119	41,472	279,680

_{*As published in the 2015-16 Budget.}

Note 2: Indirect Tax

	ACTUAL 2015-2016 July $m	ACTUAL 2015-2016 August $m	ACTUAL 2015-2016 YTD August $m	Budget Profile 2015-2016 YTD August $m	BUDGET ESTIMATE* 2015-2016 Full Year $m
Goods and services tax	5,990	4,435	10,425	10,824	60,330
Wine equalisation tax	69	63	132	112	840
Luxury car tax	54	47	101	82	450
Excise duty	1,717	2,085	3,802	4,300	24,920
Customs duty	1,137	1,328	2,465	1,407	9,480
Other indirect tax	354	270	624	569	4,374
Total indirect taxation revenue	9,322	8,227	17,549	17,294	100,394

_{*As published in the 2015-16 Budget.}

Note 3: Total expenses by function

	ACTUAL 2015-2016 July $m	ACTUAL 2015-2016 August $m	ACTUAL 2015-2016 YTD August $m	BUDGET ESTIMATE* 2015-2016 Full Year $m
Expenses by function
General public services	1,579	1,791	3,370	22,162
Defence	2,322	2,375	4,697	26,348
Public order and safety	451	398	849	4,885
Education	4,813	1,371	6,185	31,854
Health	5,836	5,698	11,534	69,381
Social security and welfare	15,488	12,911	28,399	154,000
Housing and community amenities	234	381	615	5,329
Recreation and culture	264	253	517	3,530
Fuel and energy	560	534	1,094	6,706
Agriculture, Forestry and Fishing	126	144	270	3,063
Mining, manufacturing and construction	250	202	452	3,142
Transport and communication	127	325	452	8,575
Other economic affairs	911	675	1,586	9,792
Other purposes
Public debt interest	1,233	1,248	2,480	15,561
Nominal superannuation interest	771	771	1,541	9,869
General purpose inter-government transactions	4,349	5,105	9,454	60,038
Natural disaster relief	0	0	0	33
Contingency reserve	0	0	0	201
Total expenses	39,313	34,182	73,495	434,469

_{*As published in the 2015-16 Budget.}

NOTES:

Australian Accounting Standard 1049

The Australian Government Monthly Financial Statements have been prepared on a basis consistent with the Budget as required under section 47 of the Public Governance, Performance and Accountability Act 2013. The statements are prepared in accordance with the Australian Accounting Standards Board 1049 – Whole of Government and General Government Sector Financial Reporting (AASB 1049), which require treatment based on the Australian Bureau of Statistics’ (ABS) Government Finance Statistics (GFS) except where Australian Accounting Standards (AAS) provide a better conceptual treatment for specific items. Departures are limited to complying with either ABS GFS or AAS.

Taxation Revenue

While total tax collections are known with certainty at the end of each month, the distribution across the relevant heads of revenue cannot be finalised until all Business Activity Statements are received and processed. The outcomes for some revenue items provided in this statement are therefore estimates, in accordance with the best judgement of the Commissioner of Taxation, and subject to revision. The taxation revenue items not affected are: petroleum resource rent tax, excise duty, customs duty, other taxes and individuals refunds.

Style Conventions

Figures in tables and generally in the text have been rounded. Discrepancies in tables between totals and sums of components are due to rounding.

International Monetary Fund (IMF) Special Data Dissemination Standards (SDDS)

The Government is committed to releasing the Monthly Financial Statements in a timely fashion and will endeavour to do so in accordance with International Monetary Fund (IMF) Special Data Dissemination Standards. Under these standards the timeframe for releasing the Monthly Financial Statements is by the end of the following month. Australia applies a special flexibility option which allows it to publish late the last and first month of a financial year.

In accordance with the IMF SDDS, the approximate date of release of the data on debt guaranteed by the Australian Government (central government), is given on the IMF’s Data Dissemination Advance Release Calendar http://dsbb.imf.org. Monthly and quarterly data on debt guaranteed by the Australian Government (central government) that meet the coverage and timeliness requirements of the SDDS are published on the Australian Office of Financial Management website at http://www.aofm.gov.au/content/borrowing/commonwealth.asp?NavID=32.

Electronic access to monthly financial statements

The Australian Government general government sector Monthly Financial Statements and the historical series are available in electronic format at:

http://data.gov.au/dataset/australian-government-general-government-sector-monthly-financial-statements-tables-and-data.

Australian Government General Government Sector Monthly Financial Statements July and August 2015