For departmental capital budget (DCBs) and administered capital budget (ACBs), third forward year estimate (FE3) is to be created by adjusting the second forward year estimate (FE2) estimate as follows:
- Take the (FE2) DCB or ACB estimate in Central Budget Management System (CBMS).
- Exclude any temporary adjustments affecting FE2 year, such as previously approved movements of capital budgets, temporary reclassifications between operating and capital expenditure, or non-ongoing Government decisions (these are recorded against the appropriate CBMS reason codes).
- Include any ongoing government decisions to increase/decrease the DCB/ACB as agreed in previous estimates update rounds.
- The above steps b) and c) derive the adjusted appropriation base after FE3 creation. Apply the efficiency dividend followed by indexation to the adjusted appropriation base to derive the new appropriation base after indexation adjustment.
- Input the FE3 DCB or ACB estimate into CBMS.
For CDABs, FE3 is to be created by adjusting the FE2 estimate by the relevant FE3 price indices taking into account any relevant adjustments as per ACB/DCB adjustments.
Entities should contact their AAU where they require further information regarding temporary adjustments or Government decisions that have been agreed in previous estimate update rounds.
Identifying temporary adjustments using CBMS reports
The following reports may help identify temporary adjustments:
All Reports → CBMS Reporting → Operational Reports → Estimates → Annual Estimates → AE.OR.07 Annual Estimates Capital Budget Reconciliation report
- This report may help with identifying temporary transfers where differences may arise between the reconciliation of funding, the cash flow statement and entities asset movement table account codes.
All Reports → CBMS Reporting → Operational Reports → Estimates → Annual Estimates → AE.OR.13 Annual Estimates Detail Listing AEIFRS Report
- Where adjustments can be looked at in greater detail.
Use the following reason codes to identify temporary and permanent adjustments in CBMS that could impact an entity’s FE3 estimate. The reason codes listed below are an extract only and do not represent an exhaustive list.
Examples of temporary adjustments in CBMS
The following examples provide the Reason code, Reason name and Type of capital adjustment.
1019: Self-balancing transfers - within year
One-off adjustments that have a nil impact on underlying cash and fiscal balances in the same year.
1018: Approved movement of funds – between years
For one-off movements of funds of DCB or ACBs with Finance or Finance Minister approval (also includes reclassifications between operating and capital).
1001: Government decision or measure
For new policy decisions taken by the Cabinet, Expenditure Review Committee or the Prime Minister that are temporary in nature that are published as a measure.
Examples of permanent adjustments in CBMS
The following examples provide the Reason code, Reason name and Type of capital adjustment.
1019: Self-balancing transfers - within year
Since permanent adjustments can also be coded against this reason code, entities need to apply care when identifying temporary transfers against this code.
One-off adjustments that have a nil impact on underlying cash and fiscal balances where they occur in same year.
1020: Section 75 transfers between entities
Transfer of funds between non-corporate commonwealth entity's due to a change in agency functions, usually through changed Administrative Arrangement Orders (such as, a Machinery of Government change).
1001: Government decision or measure
For new policy decisions taken by the Cabinet, Expenditure Review Committee or the Prime Minister.
