National Health Funding Body Financial Statements for the year

ended 30 June 2013

Financial statements contents

  • Financial performance
  • Independent Auditor’s report
  • Statement by the Chief Executive Officer and Chief Finance Officer
  • Statement of Comprehensive Income
  • Balance Sheet
  • Statement of Changes in Equity
  • Cash Flow Statement
  • Schedule of commitments
  • Notes to and forming part of the Financial Statements

Financial performance

The National Health Funding Body (NHFB) has received an unqualified audit report from the Australian National Audit Office on its 2012–13 Financial Statements.

NHFB finances overview

The NHFB received a transfer of appropriation under section 32 of the Financial Management and Accountability Act 1997, by the delegate of the Finance Minister. The determination commenced, in law, on 24 June 2013 when registered on the Federal Register of Legislative Instruments.

This first set of Financial Statements is for the period 1 July 2012 to 30 June 2013. Departmental revenue from government was $5.52 million. Own source revenue arose from auditing services received free of charge from the Australian National Audit Office. The Statement of Comprehensive Income displays a surplus of $0.388 million. The surplus arose due to ongoing monthly expenses arising later than initially planned and through close attention to cost control.

Budget performance

During the year, the NHFB managed expenditure within available budget and has developed an organisational culture that has a strong focus on cost control.

Independent Auditor’s report

AR Auditor's Report

 

AR Auditor's Report page 2Statement by the Chief Executive Officer and Chief Finance Officer

In our opinion, the attached financial statements for the year ended 30 June 2013 are based on properly maintained financial records and give a true and fair view of the matters required by the Finance Minister’s Orders made under the Financial Management and Accountability Act 1997, as amended.

Signed–Signature omitted–

Lynton Norris
Chief Executive Officer

9 October 2013

Signed–Signature omitted–

Naini Singh
Chief Financial Officer

9 October 2013

National Health Funding Body Statement of Comprehensive Income for the period ended 30 June 2013
Notes 2013$
EXPENSES
Employee benefits 3A (1,854,177)
Supplier expenses 3B (3,309,726)
Total expenses (5,163,903)
LESS:
OWN–SOURCE INCOME
Gains
Other gains 4A 32,000
Total gains 32,000
Total own–source income 32,000
Net cost of services (5,131,903)
Revenue from Government 4B 5,520,000
Surplus attributable to the Australian Government 388,097
OTHER COMPREHENSIVE INCOME
Total comprehensive income attributable to the Australian Government 388,097

The above statement should be read in conjunction with accompanying notes.

National Health Funding Body Balance Sheet as at 30 June 2013
Notes 2013$
ASSETS
Financial Assets
Cash and cash equivalents 5A
Trade and other receivables 5B 5,657,392
Total financial assets 5,657,392
Total assets 5,657,392
LIABILITIES
Payables
Suppliers 6A (4,993,758)
Other payables 6B (80,513)
Total payables (5,074,271)
Provisions
Employee provisions 7A (195,024)
Total provisions (195,024)
Total liabilities (5,269,295)
Net assets 388,097
EQUITY
Retained surplus 388,097
Total equity 388,097

The above statement should be read in conjunction with accompanying notes.

National Health Funding Body Statement of Changes in Equityfor the period ended 30 June 2013
Retained earnings Asset revaluation surplus Contributed equity/capital Total equity
2013$ 2013$ 2013$ 2013$
Opening balance
Balance carried forward from previous period
Adjusted opening balance
Comprehensive income
Surplus for the period 388,097 388,097
Total comprehensive income 388,097 388,097
Closing balance attributable to the Australian Government 388,097 388,097

 

National Health Funding Body Cash Flow Statement for the period ended 30 June 2013

National Health Funding Body Cash Flow Statement for the period ended 30 June 2013
Notes 2013$
OPERATING ACTIVITIES
Cash received
Net GST received 58,805
Total cash received 58,805
Cash used
Employees (8,742)
Suppliers (50,063)
Total cash used (58,805)
Net cash from operating activities 8
Net increase (decrease) in cash held
Cash and cash equivalents at the beginning of the reporting period
Cash and cash equivalents at the end of the reporting period 5A

The above statement should be read in conjunction with accompanying notes.

National Health Funding Body Schedule of Commitments as at 30 June 2013
2013$
BY TYPE
Commitments receivable
Net GST receivable on commitments 22,781
Total commitments receivable 22,781
Commitments payable
OtherA (227,810)
Total other commitments (227,810)
Net commitments by type (205,029)
BY MATURITY
Commitments receivable
One year or less 22,781
Total receivable on commitments 22,781
Commitments payable
Other Commitments
One year or less (227,810)
Total other commitments (227,810)
Net commitments by maturity (205,029)

Note: Commitments are GST inclusive where relevant.

AOther commitments payable, comprises amounts committed under signed agreements where the contracted organisation has yet to perform the services required.

This schedule should be read in conjunction with the accompanying notes.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Table of Contents — Notes

  • Note 1: Summary of Significant Accounting Policies
  • Note 2: Events After the Reporting Period
  • Note 3: Expenses
  • Note 4: Income
  • Note 5: Financial Assets
  • Note 6: Payables
  • Note 7: Provisions
  • Note 8: Cash Flow Reconciliation
  • Note 9: Contingent Assets and Liabilities
  • Note 10: Senior Executive Remuneration
  • Note 11: Remuneration of Auditors
  • Note 12: Financial Instruments
  • Note 13: Financial Assets Reconciliation
  • Note 14A: Appropriations
  • Note 14B: Compliance with statutory requirements for payments from the Consolidated Revenue Fund
  • Note 15: Compensation and Debt Relief
  • Note 16: Reporting of Outcomes
  • Note 17: Net Cash Appropriation Arrangements

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 1: Summary of Significant Accounting Policies

1.1 Objectives of the National Health Funding Body

The National Health Funding Body (NHFB) is an Australian Government controlled not–for–profit entity. The NHFB was established on 1 July 2012 and as such there are no prior year comparative balances.

The roles and functions of the NHFB are set out in the National Health Reform Act 2011. The objective of the NHFB is to assist the Administrator of the National Health Funding Pool to:

  • calculate the Commonwealth contribution to the National Health Funding Pool;
  • develop the Three Year Data Plan and associated funding reconciliation frameworks;
  • ensure the National Health Funding Pool operations are in accordance with directions from the responsible state or territory Minister, and in line with the National Health Reform Agreement (NHRA);
  • authorise payment instructions in accordance with directions from the responsible state or territory Minister, and in line with the NHRA ensure public hospitals receive funding based on need; and
  • transparently report on the operations of the National Health Funding Pool and State Managed Funds as outlined in the NHRA.

NHFB is structured to meet one outcome:

Outcome 1: Provide transparent and efficient administration of Commonwealth, state and territory funding of the Australian public hospital system, and support the obligations and responsibilities of the Administrator of the National Health Funding Pool.

The NHFB activities contributing to this outcome are classified as Departmental. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the NHFB in its own right.

The Australian Government continues to have regard to developments in case law, including the High Court’s recent decision on Commonwealth expenditure in Williams v Commonwealth (2012) 288 ALR 410, as they contribute to the larger body of law relevant to the development of Commonwealth programs. In accordance with its general practice, the Government will continue to monitor and assess risk and decide on any appropriate actions to respond to risks of expenditure not being consistent with constitutional or other legal requirements.

The continued existence of the NHFB in its present form and within its present programs is dependent on Government policy and continuing funding by Parliament for the NHFB’s administration and programs.

1.2 Basis of preparation of the Financial Statements

The financial statements are general purpose financial statements and are required by s.49 of the Financial Management and Accountability Act 1997 (FMA Act).

These financial statements cover the financial year 1 July 2012 to 30 June 2013, as no appropriation funding was received until 24 June 2013, all departmental expenditure was incurred by the Department of Health on behalf of the NHFB under a shared services arrangement.

The financial statements have been prepared in accordance with:

  1. Finance Minister’s Orders (FMOs) for reporting periods ending on or after 1 July 2011; and
  2. Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.

The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

The financial statements are presented in Australian dollars and values are rounded to the nearest dollar unless otherwise specified.

Unless an alternative treatment is specifically required by an accounting standard or the FMOs, assets and liabilities are recognised in the balance sheet when and only when it is probable that future economic benefits will flow to the NHFB or a future sacrifice of economic benefits will be required and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under executory contracts are not recognised unless required by an accounting standard. Liabilities and assets that are unrecognised are reported in the schedule of commitments or the schedule of contingencies.

Unless alternative treatment is specifically required by an accounting standard, income and expenses are recognised in the Statement of Comprehensive Income when and only when the flow, consumption or loss of economic benefits has occurred and can be reliably measured.

1.3 Significant accounting judgments and estimates

No accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next reporting period.

1.4 New Australian accounting standards

Adoption of new Australian accounting standard requirements

No accounting standard has been adopted earlier than the application date as stated in the standard. Of the new standards, amendments to standards and interpretations issued by the Australian Accounting Standards Board that are applicable to the current period did not have a financial impact, and are not expected to have a future financial impact on the NHFB.

Future Australian accounting standard requirements

Of the new accounting standards, amendments to accounting standards and interpretations issued by the Australian Accounting Standards Board that are applicable to future periods, none are expected to have a material impact on the NHFB.

1.5 Revenue

Resources received free of charge

Resources received free of charge are recognised as revenue when, and only when, a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense. Resources received free of charge are recorded as either revenue or gains depending on their nature.

Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition, unless received from another Government agency or authority as a consequence of a restructuring of administrative arrangements (refer to Note 1.7).

Revenue from Government

Amounts appropriated for departmental appropriations for the year (adjusted for any formal additions and reductions) are recognised as Revenue from Government when the NHFB gains control of the appropriation, except for certain amounts that relate to activities that are reciprocal in nature, in which case revenue is recognised only when it has been earned. Appropriations receivable are recognised at their nominal amounts.

1.6 Gains

Resources received free of charge

Resources received free of charge are recognised as gains when, and only when, a fair value can be reliably determined and the services would have been purchased if they had not been donated. Use of those resources is recognised as an expense.

Resources received free of charge are recorded as either revenue or gains depending on their nature.

Contributions of assets at no cost of acquisition or for nominal consideration are recognised as gains at their fair value when the asset qualifies for recognition, unlessreceived from another Government entity as a consequence of a restructuring of administrative arrangements (refer to Note 1.7).

1.7 Transactions with the Government as owner

Equity Injections

Amounts appropriated which are designated as ‘equity injections’ for a year (less any formal reductions) and Departmental Capital Budgets (DCB) are recognised directly in contributed equity in that year.

1.8 Employee benefits

Liabilities for ‘short–term employee benefits’ (as defined in AASB 119 Employee Benefits) and termination benefits due within twelve months at the end of the reporting period are measured at their nominal amounts.

The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability.

Other long–term employee benefits are measured as net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

Leave

The liability for employee benefits includes provision for annual leave and long service leave. No provision has been made for sick leave as all sick leave is non–vesting and the average sick leave taken in future years by employees of the NHFB is estimated to be less than the annual entitlement for sick leave.

The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will be applied at the time the leave is taken, including the NHFB’s employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.

The estimate of the present value of the liability takes into account attrition rates, pay increases and inflation.

Superannuation

Staff of the NHFB are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), the PSS accumulation plan (PSSap) or employee nominated superannuation funds.

The CSS and PSS are defined benefit schemes for the Australian Government. The PSSap and employee nominated superannuation funds are defined contribution schemes.

The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported by the Department of Finance and Deregulation’s administered schedules and notes.

The NHFB makes employer contributions to the employees’ superannuation scheme at rates determined by an actuary to be sufficient to meet the current cost to the Government. The NHFB accounts for the contributions as if they were contributions to defined contribution plans.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.

1.9 Leases

A distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and rewards incidental to ownership of leased assets. An operating lease is a lease that is not a finance lease. In operating leases, the lessor effectively retains substantially all such risks and benefits.

Operating lease payments are expensed on a straight–line basis which is representative of the pattern of benefits derived from the leased assets.

Where a lease incentive is included in an operating lease in the form of cash, freeleasehold improvements or rent–free periods, the net value of the minimum lease payments is expensed on a straight–line basis over the term of the lease.

The NHFB had not entered into any operating leases at 30 June 2013.

1.10 Cash

Cash is recognised at its nominal amount. Cash and cash equivalents includes:

  1. cash on hand; and
  2. demand deposits in bank accounts with an original maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value.

1.11 Financial assets

NHFB classifies its financial assets as loans and receivables.

The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition. Financial assets are recognised and derecognised upon trade date.

Effective Interest Method

The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, or, where appropriate, a shorter period.

Income is recognised on an effective interest rate basis.

Loans and Receivables

Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘loans and receivables’. Loansand receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.

Impairment of financial assets

Financial assets are assessed for impairment at the end of each reporting date.

1.12 Property, plant and equipment

Under the shared services arrangement between the NHFB and the Department of Health all IT, infrastructure and major office equipment is provided to the NHFB. Other property, plant and equipment purchased by NHFB have not been capitalised as at 30 June 2013, as they are low value items.

1.13 Financial liabilities

Financial liabilities are classified as either financial liabilities ‘at fair value through profit and loss’ or other financial liabilities. Financial liabilities are recognised and derecognised upon ‘trade date’.

1.13 Contingent assets and liabilities

Contingent assets and liabilities are not recognised in the balance sheet but are reported in the relevant schedules and notes. They may arise from uncertainty as to the existence of an asset or liability represent an asset or liability in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.

1.14 Taxation

NHFB is exempt from all forms of taxation except Fringe Benefits Tax (FBT) and the Goods and Services Tax (GST).

Revenues, expenses, assets and liabilities are recognised net of GST except:

  1. where the amount of GST incurred is not recoverable from the Australian Taxation Office; and
  2. for receivables and payables.

Note 2: Events After the Reporting Period

There was no subsequent event that had the potential to significantly affect the ongoing structure and financial activities of the NHFB.

Note 3: Expenses

Note 3: Expenses
2013$
Note 3A: Employee Benefits
Wages and salaries (1,305,387)
Superannuation
Defined contribution plans (219,141)
Defined benefit plans (11,955)
Leave and other entitlements (317,694)
Total employee benefits (1,854,177)
Note 3B: Suppliers
Goods and services
Consumables, printing, recruitment and training (78,144)
ContractorsB (2,561,831)
Information technology and communications (63,372)
Professional fees (103,648)
Property and utilities (218,253)
Travel (108,844)
Other (171,097)
Total goods and services (3,305,189)
Goods and services are made up of:
Provision of goods — related entities (772,198)
Provision of goods — external parties (26,609)
Rendering of services — external parties (2,506,382)
Total goods and services (3,305,189)
Other supplier expenses
Workers compensation expenses (4,537)
Total other supplier expenses (4,537)
Total supplier expenses (3,309,726)

BContractor expenses include $878,890 (GST exclusive) paid for establishing the Public Hospital Funding website in NHFB’s first year of operation. The website was established for the public reporting of National Health Reform payments under the National Health Reform Act 2011..

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 4: Income

Note 4: Income
2013$
OWN–SOURCE REVENUE
GAINS:
Note 4A: Other Gains
Resources received free of charge 32,000
Total other gains 32,000
Note 4B: Revenue from Government
Appropriations
Departmental appropriations 5,520,000
Total revenue from Government 5,520,000

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 5: Financial Assets

Note 5: Financial Assets
2013$
Note 5A: Cash and Cash Equivalents
Cash on hand or on depositC
Total cash and cash equivalents
Note 5B: Trade and Other Receivables
Good and Services:
Goods and services — related entities 78,587
Total receivables for goods and services 78,587
Appropriations receivable:
For existing program — receivable from the Official Public Account 5,520,000
Total appropriations receivable 5,520,000
Other receivables:
GST receivable from the Australian Taxation Office 58,805
Total other receivables 58,805
Total trade and other receivables 5,657,392
Receivables are expected to be recovered in:
No more than 12 months 5,657,392
Total trade and other receivables 5,657,392
Receivables are aged as follows:
Not overdue 5,657,392
Total receivables 5,657,392

Credit terms for goods and services were within 30 days.

No receivables were overdue or impaired as at 30 June 2013.

C The NHFB had no cash at bank as it did not draw down any appropriation by 30 June 2013. A transfer under s32 of the FMA Act from the Department of Health occurred on 24 June 2013, as a result all of the 2012–13 Departmental appropriation has been recognised as a receivable from the Official Public Account.

As the NHFB had no funding during the year, the departmental expenditure was incurred by the Department of Health on behalf of the NHFB under a shared services arrangement. Hence, a payable has been recognised to reimburse the Department of Health, refer to Note 6A.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 6: Payables

Note 6: Payables
2013$
Note 6A: Suppliers
Trade creditors and accruals (4,993,758)
Total supplier payables (4,993,758)
Supplier payables expected to be settled within 12 months:
Related entitiesD (4,375,667)
External parties (618,091)
Total (4,993,758)
Settlement was usually made within 30 days.
Note 6B: Other Payables
Wages and salaries (73,295)
Superannuation (7,218)
Total other payables (80,513)
Total other payables are expected to be settled in:
No more than 12 months (80,513)
Total other payables (80,513)

D This amount relates to payables to the Department of Health under a shared services arrangement.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 7: Provisions

Note 7: Provisions
2013$
Note 7A: Employee Provisions
Leave (195,024)
Total employee provisions (195,024)
Employee provisions are expected to be settled in:
No more than 12 months (156,595)
More than 12 months (38,429)
Total employee provisions (195,024)

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 8: Cash Flow Reconciliation

Note 8: Cash Flow Reconciliation
2013$
Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement
Cash and cash equivalents as per:
Cash flow statement
Balance sheet
Difference
Reconciliation of net cost of services to net cash from operating activities:
Net cost of services (5,131,903)
Add revenue from Government 5,520,000
Changes in assets / liabilities
(Increase) / decrease in net receivables (5,657,392)
Increase / (decrease) in employee provisions 195,024
Increase / (decrease) in supplier payables 4,993,758
Increase / (decrease) in other payables 80,513
Net cash from (used by) operating activities

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 9: Contingent Assets and Liabilities

Quantifiable Contingencies

As at 30 June 2013, the NHFB had no quantifiable contingencies.

Unquantifiable Contingencies

As at 30 June 2013, the NHFB had entered into an arrangement for an indemnity with the New South Wales Health Administration Council (HAC).

Under the National Health Reform Agreement (NHRA), each of the States agreed to open a Reserve Bank of Australia (RBA) account (a ‘State pool account’) for the purpose of receiving all Commonwealth and activity–based State public hospital funding. TheAdministrator of the National Health Funding Pool (the Administrator) is responsible for making payments from each State pool account, at the direction of each State Health Minister. This process is supported by the NHFB.

The HAC is a statutory body whose functions include entering into contracts to support the functions of the NSW Minister for Health. HAC has a banking contract for its Pool accounts with the RBA. HAC has provided the RBA with an indemnity that places obligations upon HAC to accept risks on persons not in its direct control, being the staff of the NHFB. The HAC has in turn sought a ‘back to back’ indemnity from the Commonwealth. The indemnity is limited to cover the actions of NHFB staff in their capacity as users of Pool account information.

The most probable cost of the indemnity if called upon would be over $20,000,000 (inclusive of GST).

A risk assessment has been undertaken in accordance with the Department of Finance’s Guidelines for Issuing and Managing Indemnities, Guarantees, Warranties and Letters of Comfort. The contingent liability includes risks which are assessed as being significant or non–remote. The NHFB will make every effort to limit the risk to the Commonwealth under the arrangement through the adoption and implementation of appropriate risk management procedures.

Significant Remote Contingencies

As at 30 June 2013, the NHFB had no significant remote contingencies.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 10: Senior Executive Remuneration

Note 10A: Senior Executive Remuneration Expenses for the Reporting Period

Note 10A: Senior Executive Remuneration Expenses for the Reporting Period
2013$
Short–term employee benefits:
Salary 320,734
Annual leave accrued 18,171
Other 62,241
Total short–term employee benefits 401,146
Post–employment benefits:
Superannuation 40,841
Total post–employment benefits 40,841
Other long–term benefits:
Long–service leave 3,233
Total other long–term benefits 3,233
Termination benefits
Total employment benefits 445,220

Notes

  1. Note 10A is prepared on an accruals basis. Hence, the figures will be different from Note 10B which is prepared on a cash basis. No bonuses have been paid to the senior executives.
  2. Note 10A excludes acting arrangements and part–year service where total remuneration expensed for a senior executive was less than $180,000.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 10: Senior Executive Remuneration

Note 10B: Average Annual Reportable Remuneration Paid to Substantive Senior Executives During the Reporting Period

Average annual reportable remuneration paid to substantive senior executives in 2013

Average annual reportable remuneration paid to substantive senior executives in 2013
Average annual reportable remuneration5-1

Senior Executives

Reportable salary5-2

Contributed superannuation5-3

Reportable allowances5-4

Bonus paid5-5

Total reportable remuneration

No. $ $ $ $ $
Total 2 188,081 19,950 193 208,224
Total remuneration (including part–time arrangements):
$180,001 to $209,999 2 188,081 19,950 193 208,224

Notes:

1 This table reports substantive senior executives who received remuneration during the reporting period. Each row is an averaged figure based on headcount for individuals in the band.

2 ‘Reportable salary’ includes the following:

  1. gross payments (less any bonuses paid, which are separated out and disclosed in the ‘bonus paid’ column);
  2. reportable fringe benefits (at the net amount prior to ‘grossing up’ to account for tax benefits);
  3. exempt foreign employment income; and
  4. salary sacrificed benefits.

3 The ‘contributed superannuation’ amount is the average actual superannuation contributions paid to senior executives in that reportable remuneration band during the reporting period, including any salary sacrificed amounts, as per the individual’s payslips.

4 ‘Reportable allowances’ are the average actual allowances paid as per the ‘total allowances’ line on individuals’ payment summaries.

5 No bonuses were paid to the senior executives.

Note 10C: Average Annual Reportable Remuneration Paid to Other Highly Paid Staff During the Reporting Period

During the reporting period, there were no other highly paid staff whose salary was $180,000 or more.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 11: Remuneration of Auditors

Note 11: Remuneration of Auditors
2013$
Financial statement audit services were provided free of charge to the NHFB by the Australian National Audit Office (ANAO).
Fair value of the services provided
Financial statement audit services 32,000
Total 32,000

No other services were provided by the auditors of the financial statements.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 12: Financial Instruments

Note 12: Financial Instruments
2013$
Note 12A: Categories of Financial Instruments
Financial Assets
Loans & Receivables
Trade and other receivables 78,587
Total 78,587
Carrying amount of financial assets 78,587
Financial Liabilities
At amortised cost
Trade creditors and accruals (4,993,758)
Total (4,993,758)
Carrying amount of financial liabilities (4,993,758)

Note 12B: Net Income and Expense from Financial Assets

There is no income or expense from financial assets in 2012–13.

Note 12C: Net Income and Expense from Financial Liabilities

There is no net income or expense from financial liabilities in 2012–13.

Note 12D: Fair Value of Financial Instruments

Note 12D: Fair Value of Financial Instruments
Carrying amount2013$ Fair value2013$
Total (4,993,758) (4,993,758)
Financial Assets
Loan & Receivables
Trade and other receivables 78,587 78,587
Total 78,587 78,587
Financial Liabilities
Trade creditors and accruals (4,993,758) (4,993,758)

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 12: Financial Instruments

Note 12E: Financial Liabilities Designated at Fair Value through Statement of Comprehensive Income

The NHFB does not value liabilities at fair value through Statement of Comprehensive Income.

Note 12F: Credit Risk

NHFB is exposed to minimal credit risk as receivables were cash and other receivables. The maximum exposure to credit risk for other receivables is the risk that arises from potential default of a debtor. This amount was equal to the total amount of trade receivables 2012–13: $78,587. The NHFB has endorsed policies and procedures for debt management, to reduce the incidence of credit risk. NHFB has no significant exposures to any concentrations of credit risk.

No collateral is held in relation to the NHFB’s gross credit risk.

Credit quality of financial instruments not past due or individually determined as impaired

Credit quality of financial instruments not past due or individually determined as impaired
Not past due nor impaired2013$ Past due or impaired2013$
Total 78,587
Receivables for goods and services 78,587

Trade Debtors and receivables that are past due are not considered as risky in both credit risk and quality.

Ageing of financial assets that were past due but not impaired for 2013

Ageing of financial assets that were past due but not impaired for 2013
0 to 30days$ 31 to 60days$ 61 to 90days$ 90days$ Total$
Total
Receivables for goods and services

There are no financial assets which have been individually assessed as impaired.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 12: Financial Instruments

Note 12G: Liquidity Risk

The NHFB’s financial liabilities only include suppliers. Any exposure to liquidity risk is based on the notion that the NHFB will encounter difficulty in meeting its obligations associated with financial liabilities. This is highly unlikely due to appropriation funding from the Australian Government and internal policies and procedures put in place to ensure there are appropriate resources to meet its financial obligations.

Maturities for non–derivative financial liabilities 2013

Maturities for non–derivative financial liabilities 2013
Ondemand$ within 1year$ 1 to 2years$ 2 to 5years$ > 5years$ Total$
Total (4,993,758) (4,993,758)
Suppliers (4,993,758) (4,993,758)

The NHFB has no derivative financial liabilities in either 2012–13.

Note 12H: Market Risk

The NHFB does not participate in any currency dealings including foreign exchange and as such is not exposed to market risk. The NHFB also only has indirect exposure in interest rates and as such the impact on supplier costs is not significant.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 13: Financial Assets Reconciliation

Note 13: Financial Assets Reconciliation
Notes 2013$
Financial assets
Total financial assets as per balance sheet 5,657,392
Less: non–financial instrument components
Appropriations receivable 5B 5,520,000
GST Receivable from the Australian Taxation Office 5B 58,805
Total non–financial instrument components 5,578,805
Total financial assets as per financial instruments note 78,587

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 14A: Appropriations

Table A: Annual Appropriations (‘Recoverable GST exclusive’)

Table A: Annual Appropriations (‘Recoverable GST exclusive’)
2013 Appropriations Appropriation applied in 2013 (current and prior years) Variance7-2
Appropriation Act FMA Act Total appropriation
Annual Appropriation Appropriations reduced Section 30 Section 31 Section 327-1
$ $ $ $ $ $ $ $
Total departmental 5,520,000 5,520,000 5,520,000
DEPARTMENTAL
Ordinary annual services 5,520,000 5,520,000 5,520,000

Notes

1 A Determination under Section 32 of the Financial Management and Accountability Act 1997 was registered on 24 June 2013 resulting in the transfer of funds from the Department of Health (previously the Department of Health and Ageing) to NHFB.

2 The variance of $5,520,000 is due to the NHFB not drawing down any appropriation by 30 June 2013. A transfer under s32 of the FMA Act from the Department of Health occurred on 24 June 2013, as a result all of the 2012–13 Departmental appropriation has been recognised as a receivable from the Official Public Account.

Table B: Departmental and Administered Capital Budgets (‘Recoverable GST exclusive’)

There was no Departmental Capital Budget appropriated to NHFB in 2012–13.

Table C: Unspent Annual Appropriations (‘Recoverable GST exclusive’)

Table C: Unspent Annual Appropriations (‘Recoverable GST exclusive’)
Authority 2013$
Total 5,520,000
DEPARTMENTAL
Appropriation Act (No 1) 2012–13 5,520,000

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 14B: Compliance with statutory requirements for payments from the Consolidated Revenue Fund

Section 83 of the Constitution provides that no amount may be paid out of the Consolidated Revenue Fund except under an appropriation made by law. The Department of Finance and Deregulation provided information to all agencies in 2011 regarding the need for risk assessments in relation to compliance with statutory conditions on payments from special appropriations, including special accounts. NHFB does not have any special appropriations or special account. During 2012–13 additional legal advice was received that indicated there could be breaches of Section 83 under certain circumstances with payments for long service leave, goods and services tax and payments under determinations of the Remuneration Tribunal. NHFB will review its processes and controls over payments for these items to minimise the possibility of future breaches as a result of these payments.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 15: Compensation and Debt Relief

Note 15: Compensation and Debt Relief
2013$
DEPARTMENTAL
No ‘Act of Grace’ expenses were incurred during the reporting period.
No payments were made under any legislative authority during the reporting period.
No expenses were made on a periodic basis. None are expected in future years. The estimated amount outstanding in relation to payments being made on a periodic basis at 30 June 2013 was nil.
No waivers of amounts owing to the Australian Government were made pursuant to subsection 34(1) of the Financial Management and Accountability Act 1997.
No ex–gratia payments were provided for during the reporting period.
No payments were provided in special circumstances relating to APS employment pursuant to section 73 of the Public Service Act 1999 during the reporting period.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 16: Reporting of Outcomes

Note 16A: Net Cost of Outcome Delivery

Note 16: Reporting of Outcomes
Outcome 1E2013$
DEPARTMENTAL
Expenses (5,163,903)
Own–source income 32,000
Net (cost)/contribution of outcome delivery (5,131,903)

EOutcome 1 is described in Note 1.1. Net costs shown included intra–government costs that were eliminated in calculating the actual Budget Outcome.

The NHFB had one Outcome in the 2012–13 financial year. All revenues, expenses, assets and liabilities are in relation to achieving this Outcome.

National Health Funding Body Notes to and forming part of the Financial Statements for the period ended 30 June 2013

Note 17: Net Cash Appropriation Arrangements

Note 17: Net Cash Appropriation Arrangements
2013$
Total comprehensive income (loss) less depreciation/amortisation expenses previously funded through revenue appropriationsF 388,097
Plus: depreciation/amortisation expenses previously funded through revenue appropriation
Total comprehensive income (loss) — as per the Statement of Comprehensive Income 388,097

FFrom 2010–11, the Government introduced net cash appropriation arrangements, where revenue appropriations for depreciation/amortisation expenses ceased. Entities now receive a separate capital budget provided through equity appropriations. Capital budgets are to be appropriated in the period when cash payment for capital expenditure is required.

Previous Page Next Page