Notes 6–10

Note 6: Non-Financial Assets
 
 
 
2013
 
2012
 
$'000
 
$'000
Note 6A:  Land and Buildings
 
Land:
 
Land at fair value1
1,097,187
 
921,466
Total land
1,097,187
 
921,466
 
 
Buildings:
 
Fair value1
739,363
 
696,486
Accumulated depreciation
(1,077)
 
(521)
Work in progress2
50,781
 
15,657
Total buildings
789,067
 
711,622
 
 
Leasehold improvements:
 
Fair value
200,436
 
289,995
Accumulated depreciation
(21,288)
 
(121,876)
Work in progress
16,251
 
15,674
Total leasehold improvements
195,399
 
183,793
Total land and buildings
2,081,653
 
1,816,881
 
 
1 This includes assets held for sale as follows:
2012-13: One property (Former Chancery in Phnom Penh, Cambodia) was sold and settled during the year. Total value is $1,599,307.
2011-12:  One property (Former Chancery in Phnom Penh, Cambodia) has been classified as an Asset Held for Sale. Total value is $1,599,307.
2 This is a qualifying asset and includes foreign exchange gains and losses that have been capitalised.
No indicators of impairment have been found for land and buildings (2012: $1,034,000).
 
 
Note 6B:  Infrastructure, Plant and Equipment
Infrastructure, Plant and Equipment:
 
Fair value
207,968
 
181,737
Accumulated depreciation
(88,770)
 
(59,680)
Work in progress
28,585
 
29,502
Total infrastructure, plant and equipment
147,783
 
151,559
No plant and equipment was held by the Department under finance leases.
Isolated indicators of impairment worth $24,422 (2012: $4,040) were found for Infrastructure, plant and equipment.
 
 
Revaluations of non-financial assets
 
All revaluations are conducted in accordance with the revaluation policy stated at Note 1. Land and buildings have been independently valued by Savills as at 30 June 2013.  Leasehold Improvements and Infrastructure, plant and equipment have been independently valued by the Australian Valuation Office as at 31 March 2013.

Revaluation increments of $180,380,000 for land (2012: increments of $54,412,000), revaluation increments of $57,164,666 for buildings (2012: increments of $2,946,000), revaluation increments of $17,888,807 for leasehold improvements (2012:  impairment decrements of $28,101) and impairment decrements of $20,743 for infrastructure, plant and equipment (2012:  revaluation/impairment increment of $5,642,652) were made to the asset revaluation reserve.  

Revaluation decrements of $153,606 for infrastructure, plant and equipment (2012: decrement of $nil), impairment decrement for infrastructure, plant and equipment of $3,679 (2012: decrement of $4,040) and revaluation decrements of $nil for buildings (2012: increments of $16,691,000) were recognised in the profit and loss.
 
 
Restrictions on title
 
Due to the diplomatic nature of the overseas property portfolio, some properties have restriction on title.  Restrictions on title vary depending on local government rules and regulations, such as one long term title that prohibits the Commonwealth of Australia from profiting from sale of the land.
 
 
Note 6C:  Reconciliation of the Opening and Closing Balances of Infrastructure, Plant and Equipment 2013
 
 
Land
Buildings
Total land
and
buildings
Infrastructure,
plant &
equipment
Total
 
$'000
$'000
$'000
$'000
$'000
As at 1 July 2012
Gross book value
921,466
986,481
1,907,947
181,737
2,089,684
Accumulated depreciation and impairment
-
(122,397)
(122,397)
(59,680)
(182,077)
Work in progress
-
31,331
31,331
29,502
60,833
Net book value 1 July 2012
921,466
895,415
1,816,881
151,559
1,968,440
Additions:
By purchase
-
31,570
31,570
16,866
48,436
By finance lease
-
-
-
-
-
By donation/gift
-
-
-
-
-
From acquisition of entities or operations (including restructuring)
-
-
-
-
-
Revaluations and impairments recognised in other comprehensive income
180,380
75,053
255,433
(21)
255,412
Revaluations recognised in the operating result
-
-
-
(154)
(154)
Impairments recognised in the operating result
-
-
-
(4)
(4)
Reversal of impairments recognised in the operating result
-
-
-
-
-
Assets held for sale or in a disposal group held for sale
-
-
-
-
-
Depreciation expense
-
(64,778)
(64,778)
(39,619)
(104,397)
Other movements
-
Asset transfers
(3,165)
12,156
8,991
26,765
35,756
Movement in work in progress
Reclassification of opening balance in work in progress
-
-
-
-
-
Net movement in work in progress
-
35,701
35,701
(917)
34,784
Disposals:
From disposal of entities or operations (including restructuring)
-
-
-
-
-
Other
(1,494)
(651)
(2,145)
(6,692)
(8,837)
Net book value 30 June 2013
1,097,187
984,466
2,081,653
147,783
2,229,436
 
Net book value as of 30 June 2013 represented by:
Gross book value
1,097,187
939,799
2,036,986
207,968
2,244,954
Accumulated depreciation and impairment
-
(22,365)
(22,365)
(88,770)
(111,135)
Work in progress
-
67,032
67,032
28,585
95,617
 
1,097,187
984,466
2,081,653
147,783
2,229,436
 
 
Reconciliation of the Opening and Closing Balances of Infrastructure, Plant and Equipment 2012
 
Land
Buildings
Total land
and
buildings
Infrastructure,
plant &
equipment
Total
 
$'000
$'000
$'000
$'000
$'000
As at 1 July 2011
Gross book value
867,840
916,717
1,784,557
182,316
1,966,873
Accumulated depreciation and impairment
-
(95,826)
(95,826)
(55,555)
(151,381)
Work in progress
-
61,994
61,994
14,672
76,666
Net book value 1 July 2011
867,840
882,885
1,750,725
141,433
1,892,158
Additions:
By purchase or internally developed
156
39,246
39,402
21,550
60,952
By finance lease
-
-
-
-
-
By donation/gift
-
-
-
-
-
From acquisition of entities or operations (including restructuring)
-
-
-
-
-
Revaluations and impairments recognised in other comprehensive income
54,412
2,946
57,358
5,643
63,001
Revaluations recognised in the operating result
-
16,691
16,691
-
16,691
Impairments recognised in the operating result
(229)
(805)
(1,034)
(4)
(1,038)
Reversal of impairments recognised in the operating result
-
-
-
-
-
Assets held for sale or in a disposal group held for sale
1,494
105
1,599
-
1,599
Depreciation expense
-
(50,064)
(50,064)
(36,278)
(86,342)
Other movements
-
Asset transfers
-
35,425
35,425
7,577
43,002
Movements in work in progress
Reclassification of opening balance in work in progress
-
-
-
-
-
Net movement in work in progress
-
(30,663)
(30,663)
14,830
(15,833)
Disposals:
From disposal of entities or operations (including restructuring)
-
-
-
-
-
Other
(2,207)
(351)
(2,558)
(3,192)
(5,750)
Net book value 30 June 2012
921,466
895,415
1,816,881
151,559
1,968,440
 
Net book value as of 30 June 2012 represented by:
Gross book value
921,466
986,481
1,907,947
181,737
2,089,684
Accumulated depreciation and impairment
-
(122,397)
(122,397)
(59,680)
(182,077)
Work in progress
-
31,331
31,331
29,502
60,833
 
921,466
895,415
1,816,881
151,559
1,968,440
 
 
2013
 
2012
 
$'000
 
$'000
Note 6D:  Intangibles
Computer software:
 
Internally developed – in progress
6,453
 
5,259
Internally developed – in use
35,502
 
32,518
Purchased
75,565
 
60,396
Accumulated amortisation
(48,502)
 
(40,479)
Total computer software
69,018
 
57,694
 
 
Total intangibles
69,018
 
57,694
 
 
No indicators of impairment were found for intangible assets.
 
 
 
 
Note 6E:  Reconciliation of the Opening and Closing Balances of Intangibles 2013
 
 
 
Computer
software
internally
developed
 
Computer 
software
purchased
Total
 
$'000
 
$'000
$'000
As at 1 July 2012
 
Gross book value
32,518
 
28,851
61,369
Accumulated amortisation and impairment
(25,082)
 
(15,397)
(40,479)
Work in Progress
5,259
 
31,545
36,804
Net book value 1 July 2012
12,695
 
44,999
57,694
Additions:
 
By purchase or internally developed
331
 
1,064
1,395
By finance lease
-
 
-
-
By donation/gift
-
 
-
-
From acquisition of entities or operations (including restructuring)
-
 
-
-
Revaluations and impairments recognised in other comprehensive income
-
 
-
-
Revaluations and impairments recognised in the operating result
-
 
-
-
Reversal of impairments recognised in the operating result
-
 
-
-
Amortisation
(3,695)
 
(4,335)
(8,030)
Other movements
 
Asset transfers
4,088
 
2,460
6,548
Movements in work in progress
 
Reclassification of opening balance in work in progress
-
 
-
-
Net movement in work in progress
1,194
 
11,851
13,045
Disposals:
 
From disposal of entities or operations (including restructuring)
-
 
-
-
Other
(1,436)
 
(198)
(1,634)
Net book value 30 June 2013
13,177
 
55,841
69,018
 
 
Net book value as of 30 June 2013 represented by:
 
Gross book value
35,502
 
32,169
67,671
Accumulated amortisation and impairment
(28,778)
 
(19,724)
(48,502)
Work in progress
6,453
 
43,396
49,849
 
13,177
 
55,841
69,018
 
 
Note 6E:  Reconciliation of the Opening and Closing Balances of Intangibles 2013
 
Computer software internally developed
 
Computer  software purchased
Total
 
$'000
 
$'000
$'000
As at 1 July 2011
 
Gross book value
32,518
 
22,713
55,231
Accumulated amortisation and impairment
(23,963)
 
(11,743)
(35,706)
Work in progress
6,561
 
10,142
16,703
Net book value 1 July 2011
15,116
 
21,112
36,228
Additions:
 
By purchase or internally developed
-
 
4,034
4,034
By finance lease
-
 
-
-
By donation/gift
-
 
-
-
From acquisition of entities or operations (including restructuring)
-
 
-
-
Revaluations and impairments recognised in other comprehensive income
-
 
-
-
Revaluations and impairments recognised in the operating result
-
 
-
-
Reversal of impairments recognised in the operating result
-
 
-
-
Amortisation
(1,119)
 
(4,126)
(5,245)
Other movements [give details below]
 
Asset transfers
-
 
5,984
5,984
Movements in work in progress
 
Reclassification of opening balance in work in progress
-
 
-
-
Net movement in work in progress
(1,302)
 
21,403
20,101
Disposals:
 
From disposal of entities or operations (including restructuring)
-
 
-
-
Other
-
 
(3,408)
(3,408)
Net book value 30 June 2012
12,695
 
44,999
57,694
 
 
Net book value as of 30 June 2012 represented by:
 
Gross book value
32,518
 
28,851
61,369
Accumulated amortisation and impairment
(25,082)
 
(15,397)
(40,479)
Work in progress
5,259
 
31,545
36,804
 
12,695
 
44,999
57,694
 
 
 
2013
 
2012
 
$'000
 
$'000
Note 6F:  Inventories
Inventories held for sale:
 
Finished goods
30,998
 
41,843
Total inventories held for sale
30,998
 
41,843
Inventories held for distribution
127
 
133
Total inventories
31,125
 
41,976
 
 
No items of inventory were recognised at fair value less cost to sell.
 
 
All inventories are expected to be sold or distributed in the next 12 months.
 
 
 
 
Note 6G:  Other Non-Financial Assets
Property leases
19,694
 
15,571
Other
45,029
 
11,475
Total other non-financial assets
64,723
 
27,046
 
 
Total other non-financial assets:
 
No more than 12 months
56,644
 
22,705
More than 12 months
8,079
 
4,341
Total other non-financial assets
64,723
 
27,046
 
 
No indicators of impairment were found for other non-financial assets.
 
 
Note 7: Payables
 
 
 
2013
 
2012
 
$'000
 
$'000
Note 7A: Suppliers
Trade creditors and accruals
79,870
 
76,099
Total suppliers payables
79,870
 
76,099
 
 
Suppliers payables expected to be settled within 12 months:
 
Related entities
17,156
 
18,167
External parties
62,714
 
57,932
Total
79,870
 
76,099
 
 
Note 7B: Other Payables
Wages and salaries
10,838
 
9,313
Superannuation
1,259
 
1,111
Prepayments received/unearned income
19,518
 
18,140
Other
11,802
 
2,983
Total other payables
43,417
 
31,547
 
 
Total other payables are expected to be settled in:
 
No more than 12 months
38,763
 
22,186
More than 12 months
4,654
 
9,361
Total other payables
43,417
 
31,547
 
 

Note 8: Provisions
 
 
 
2013
 
2012
 
$'000
 
$'000
Note 8A:  Employee Provisions
Annual Leave
32,047
 
31,001
Long Service Leave
74,205
 
75,982
Superannuation
13,195
 
13,277
Separations and redundancies
11,967
 
11,268
Other employee provisions
11,992
 
4,265
Total employee provisions
143,406
 
135,793
 
 
Employee provisions are expected to be settled in:
 
No more than 12 months
50,922
 
47,189
More than 12 months
92,484
 
88,604
Total employee provisions
143,406
 
135,793
 
 
Note 8B:  Other Provisions
Provision for restoration obligations
19,595
 
26,679
Total other provisions
19,595
 
26,679
 
 
Other provisions are expected to be settled in:
 
No more than 12 months
952
 
3,501
More than 12 months
18,643
 
23,178
Total other provisions
19,595
 
26,679
 
 
 
 
Provision for restoration
 
 
$'000
Carrying amount 1 July 2012
 
26,679
Additional provisions made
 
1,023
Amounts Reversed
 
(2,007)
Revaluation of provision
 
(8,823)
Movements due to foreign exchange
 
936
Unwinding of discount or change in discount rate
 
1,787
Closing balance 2013
 
19,595
 
The Department currently has 69 agreements (2012: 69) for the leasing of premises where the Department has raised a provision to restore the premises to their original condition at the conclusion of the lease.  The provision reflects the present value of this obligation.
 
 
Note 9: Cash Flow Reconciliation
 
 
 
 
2013
 
2012
 
$'000
 
$'000
Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement
 
 
 
Cash and cash equivalents as per:
 
Cash flow statement
59,346
 
54,787
Balance sheet
59,346
 
54,787
Difference
-
 
-
 
 
Reconciliation of net cost of services to net cash from operating activities:
 
Net cost of services
(934,136)
 
(876,433)
Add revenue from Government
885,748
 
821,534
 
 
Adjustments for non-cash items
 
Depreciation / amortisation
112,448
 
91,589
Net write down of non-financial assets
1,720
 
1,038
Reversals of Previous Asset Write-Downs (Asset Revaluation)
-
 
(16,691)
Loss (Gain) on disposal of assets
8,259
 
6,091
Resources received free of charge - Non Financial Assets
-
 
(5,999)
Investing OPA (receivable)
9,938
 
(54,281)
Effect of foreign exchange on cash
5,072
 
2,051
Interest
-
 
1
 
 
Changes in assets / liabilities
 
(Increase) / decrease in net receivables
(44,311)
 
16,392
(Increase) / decrease in inventories
10,853
 
(1,738)
(Increase) / decrease in prepayments
(38,306)
 
734
Increase / (decrease) in employee provisions
9,283
 
13,959
Increase / (decrease) in supplier payables
3,774
 
(4,296)
Increase / (decrease) in other provisions
7,027
 
333
Increase / (decrease) in other assets
(144)
 
8,751
Increase / (decrease) in unearned income
1,597
 
(266)
Increase / (decrease) in other liabilities
4,923
 
(2,712)
Net cash from (used by) operating activities
43,745
 
57
 
 
Note 10: Contingent Assets and Liabilities 
 
 
Guarantees
Claims for
damages or costs
Total
 
2013
2012
2013
2012
2013
2012
 
$'000
$'000
$'000
$'000
$'000
$'000
Contingent assets
Balance from previous period
-
-
-
12
-
12
New contingent assets recognised
-
-
-
-
-
-
Re-measurement
-
-
-
-
-
-
Assets recognised
-
-
-
-
-
-
Expired
-
-
-
(12)
-
(12)
Total contingent assets
-
-
-
-
-
-
 
Contingent liabilities
Balance from previous period
114
125
397
541
511
666
New
-
-
303
-
303
-
Re-measurement
15
(11)
26
(8)
41
(19)
Liabilities recognised
-
-
-
-
-
-
Obligations expired
-
-
-
(136)
-
(136)
Total contingent liabilities
129
114
726
397
855
511
Net contingent assets (liabilities)
(129)
(114)
(726)
(397)
(855)
(511)
 
Quantifiable Contingencies
The Schedule of Contingencies reports contingent liabilities in respect of claims for damages/costs of $725,969 (2012: $396,967).  This amount represents an estimate of the Department's liability based on precedent cases and on advice from the Department's external legal service providers.  The Department is defending the claims.
 
The Schedule of Contingencies reports contingent liabilities in respect of bank and residential lease guarantees made by the department of $129,472 (2012: $113,618).
 
 
Unquantifiable Contingencies
At 30 June 2013, the Department was involved in a number of litigation matters for losses allegedly suffered by claimants.  The Department is defending the claims.  It is not possible to estimate the amounts of any eventual payments that may be required in relation to these claims.
 
Significant Remote Contingencies
The Department is currently defending a number of other legal claims.  At 30 June 2013, advice from the Department's external legal service providers is that the Department has a strong case in each of these matters and is not likely to be found liable.