FINANCIAL STATEMENTS 
FOR YEAR ENDED 30 JUNE 2012

CONTENTS

Independent Audit Report 			
Statement by Officers		
Statement of Comprehensive Income		
Balance Sheet		
Statement of Changes in Equity		
Cash Flow Statement		
Schedule of Commitments		
Schedule of Contingencies		
Administered Schedule of Comprehensive Income		
Administered Schedule of Assets and Liabilities		
Administered Reconciliation Schedule		
Administered Cash Flow Statement		
Schedule of Administered Commitments		
Schedule of Administered Contingencies		
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: Non-Financial Assets		
Note 7: Payables		
Note 8: Interest Bearing Liabilities		
Note 9: Provisions		
Note 10: Cash Flow Reconciliation		
Note 11: Contingent Assets and Liabilities 		
Note 12: Senior Executive Remuneration		
Note 13: Remuneration of Auditors		
Note 14: Financial Instruments		
Note 15: Financial Assets Reconciliation		
Note 16: Administered – Cash Flow Reconciliation		
Note 17: Administered - Contingent Assets and Liabilities		
Note 18: Appropriations		
Note 19: Special Accounts		
Note 20: Compliance with Statutory Conditions for Payments from the Consolidated Revenue Fund		
Note 21: Compensation and Debt Relief		
Note 22: Reporting of Outcomes 		
Note 23: Net Cash Appropriation Arrangements		

			Independent Audit Report

Certification by the Auditor General

[Leave two pages blank for insertion of signed copy of certification]

ADMINISTRATIVE APPEALS TRIBUNAL

STATEMENT BY THE CHIEF EXECUTIVE AND CHIEF FINANCIAL OFFICER

In our opinion, the attached financial statements for the year ended 30 June 2012 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.  

	

PHILIP KELLOW					MICHAEL BINNINGTON	
Chief Executive					Chief Financial Officer				
					
 September 2012					 September 2012
ADMINISTRATIVE APPEALS TRIBUNAL

Statement of Comprehensive Income for not-for-profit Reporting Entities
for the period ended 30 June 2012	

	
Notes	2012
$’000		2011
$’000	
EXPENSES					
Employee benefits	3A	21,692		21,572	
Supplier expenses	3B	13,044		12,875	
Depreciation and amortisation	3C	1,886		1,800	
Losses from assets sales	3D	2		18	
Total expenses		36,624		36,265	
					
LESS:					
OWN-SOURCE INCOME					
Own-source revenue					
Sale of goods and rendering of services	4A	1,351		1,116	
Total own-source revenue		1,351		1,116	
					
GAINS					
Other	4B	313		244	
Total gains		313		244	
Total own-source income		1,664		1,360	
					
Net cost of services		34,960		34,905	
					
Revenue from Government	4C	34,579		32,732	
Surplus / (Deficit) attributable to the Australian Government		(381)		(2,173)	
					
OTHER COMPREHENSIVE INCOME					
Changes in asset revaluation surplus		265		123	
Total other comprehensive income		265		123	
					
Total comprehensive income/(loss) attributable to the Australian Government		
(116)		
(2,050)	

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

ADMINISTRATIVE APPEALS TRIBUNAL

Balance Sheet for not-for-profit Reporting Entities
as at 30 June 2012	

	
Notes	2012
$’000		2011
$’000	
ASSETS					
Financial Assets					
Cash and cash equivalents	5A	283		98	
Trade and other receivables	5B	11,380		9,959	
Total financial assets		11,663		10,057	
					
Non-Financial Assets					
Leasehold improvements	6A,C	4,705		5,587	
Plant and equipment 	6B,C	1,438		1,633	
Intangibles	6D,E	248		429	
Other non-financial assets	6F	346		495	
Total non-financial assets		6,737		8,144	
Total Assets		18,400		18,201	
					
LIABILITIES					
Payables					
Suppliers	7A	661		1,177	
Total payables		661		1,177	
					
Interest Bearing Liabilities					
Other	8A	813		837	
Total interest bearing liabilities		813		837	
					
Provisions					
Employee provisions	9A	6,071		6,082	
Other provisions	9B	480		420	
Total provisions		6,551		6,502	
Total liabilities		8,025		8,516	
Net assets		10,375		9,685	
					
EQUITY					
Parent Entity Interest					
Contributed equity		3,145		2,339	
Reserves		3,821		3,556	
Retained surplus 		3,409		3,790	
Total parent entity interest		10,375		9,685	
Total Equity		10,375		9,685	

The above statement should be read in conjunction with the accompanying notes.
ADMINISTRATIVE APPEALS TRIBUNAL

Statement of Changes in Equity for not-for-profit Reporting Entities
for the period ended 30 June 2012	

	Retained earnings		Asset revaluation surplus		Contributed equity/capital		Total equity		
	2012	2011	2012	2011	2012	2011	2012	2011	
	$’000	$’000	$’000	$’000	$’000	$’000	$’000	$’000	
Opening balance									
Balance carried forward from previous period	
3,790	
5,963	
3,556	
3,433	
2,339	
1,592	
9,685	
10,988	
Adjusted opening balance	3,790	5,963	3,556	3,433	2,339	1,592	9,685	10,988	

Comprehensive income 									
Other comprehensive income	-	-	265	123	-	-	265	123	
(Deficit) for the period	(381)	(2,173)	-	-	-	-	(381)	(2,173)	

Total comprehensive income	
(381)	
(2,173)	
265	
123	
-	
-	
( 116)	
(2,050)	
Of which:									
Attributable to the               Australian Government	
(381)	
(2,173)	
265	
123	
-	
-	
(116)	
(2,050)	
									
Transactions with owners									
Contribution by owners
Departmental capital budget 	
-	
-	
-	
-	
806	
747	
806	
747	
Sub-total transactions with owners	
-	
-	
-	
-	
806	
747	
806	
747	
Closing balance as at 30 June	
3,409	
3,790	
3,821	
3,556	
3,145	
2,339	
10,375	
9,685	

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

ADMINISTRATIVE APPEALS TRIBUNAL

Cash Flow Statement for not-for-profit Reporting Entities
for period ended  30 June 2012	

	
Notes	2012
$’000		2011
$’000	
OPERATING ACTIVITIES					
Cash received					
Appropriations		33,279		31,153	
Sales of goods and rendering of services		1,230		1,029	
Net GST received		1,293		1,321	
Total cash received		35,802		33,503	
					
Cash used					
Employees 		(21,428)		(21,173)	
Suppliers		(14,690)		(12,916)	
Total cash used		(36,118)		(34,089)	
Net cash from operating activities	10	(316)		(586)	
					
INVESTING ACTIVITIES					
Cash used					
Purchase of plant and equipment		(305)		(579)	
Purchase of intangibles		-		(210)	
Total cash used		(305)		(789)	
Net cash used by investing activities		(305)		(789)	
					
FINANCING ACTIVITIES					
Cash received					
Contributed equity		806		747	
Total cash received		806		747	
Net cash from financing activities		806		747	
					
Net increase (decrease) in cash held		185		(628)	
Cash and cash equivalents at the beginning of the reporting period		98		726	
Cash and cash equivalents at the end of the reporting period	5A	283		98	

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

ADMINISTRATIVE APPEALS TRIBUNAL

Schedule of Commitments 
as at 30 June 2012	

		2012
$’000		2011
$’000	
BY TYPE
Commitments receivable
Net GST recoverable on commitments1		(1,559)		(2,064)	
Total commitments receivable		(1,559)		(2,064)	

Commitments payable
Other commitments
Operating leases 2,3		17,120		22,631	
Other		12		34	
Total other commitments		17,132		22,665	
Net commitments by type		15,573		20,601	

BY MATURITY
Commitments receivable
Net GST recoverable on commitments1
One year or less		(425)		(434)	
From one to five years		(1,134)		(1,630)	
Over five years		-		-	
Total commitments receivable		(1,559)		(2,064)	

Commitments payable
Operating lease commitments
One year or less		4,652		4,703	
From one to five years		12,468		17,928	
Over five years		-		-	
Total operating lease commitments		17,120		22,631	

Other commitments
One year or less		12		34	
From one to five years		-		-	
Over five years		-		-	
Total other commitments		12		34	
Total commitments payable		17,132		22,665	
Net commitments by maturity		15,573		20,601	

1 Commitments are GST inclusive where relevant.
2 These commitments comprise of leases of hearing rooms and office accommodation for the Tribunal.
3 Operating leases included are effectively non-cancellable and comprise:  
   - Leases for office accommodation.
	The entity in its capacity as Lessor holds commercial office accommodation leases where lease payments by the Tribunal are subject to fixed or market review increases as listed in the lease agreements. All commercial office accommodation leases are current and most have extension options for the Tribunal following a review of rentals to current market. An arrangement equivalent to commercial office accommodation leases is presently being negotiated in relation to Commonwealth owned law courts accommodation in Brisbane and Hobart and no commitment is recognized at this time. 

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

ADMINISTRATIVE APPEALS TRIBUNAL

Schedule of Contingencies 
as at 30 June 2012	

There are no quantifiable contingent assets or liabilities as at 30 June 2012 (2011: Nil).  Refer to Note 11 for details of any unquantifiable or remote contingent assets or contingent liabilities.

ADMINISTRATIVE APPEALS TRIBUNAL

Administered Schedule of Comprehensive Income for not-for-profit Reporting Entities	
for the period ended 30 June 2012	

	
Notes	2012
$’000		2011
$’000	
EXPENSES					
Refund of application fees		280		303	
Total expenses administered on behalf of Government		280		303	
					
LESS:					
OWN-SOURCE INCOME					
Non-taxation revenue					
Application fees		689		626	
Interest		1,291		-	
Total non-taxation revenue		1,980		626	
Total own-source revenue administered on behalf of Government		1,980		626	
					
Net contribution by services		(1,700)		(323)	
					
Surplus after income tax		1,700		626	
Total comprehensive income 		1,700		323	
					
The above schedule should be read in conjunction with the accompanying notes.			

Administered Schedule of Assets and Liabilities for not-for-profit Reporting Entities	
as at 30 June 2012	

There were no administered assets or liabilities as at 30 June 2012 (2011: Nil).

Administered Reconciliation Schedule for not-for-profit Reporting Entities	
	
				2012
$’000		2011
$’000	
Opening administered assets less administered liabilities as at 1 July				
-		
-	
							
Surplus / (deficit) items:							
	Plus: Administered income				1,980		626	
	Less: Administered expenses				(280)		(303)	
Administered transfers to/ from Australian Government:							
	Appropriation transfers from OPA:							
	Special appropriations (limited) s28 refunds	280		303	
	Transfers to OPA				(1,980)		(626)	
							
Closing administered assets less administered liabilities as at 30 June	-		-	

ADMINISTRATIVE APPEALS TRIBUNAL

Administered Cash Flow Statement for not-for-profit Reporting Entities	
for the period ended 30 June 2012	
						
			2012
$’000		2011
$’000	
OPERATING ACTIVITIES
Cash received						
Application fees			689		626	
Interest			1,291		-	
Total cash received			1,980		626	

Cash used 						
Refund of application fees			(280)		(303)	
Total cash used			(280)		(303)	
Net cash flows from operating activities			1,700		323	
						
Net Increase  in Cash  Held			1,700		323	

Cash and cash equivalents at the beginning of the reporting period			
-		
-	
Cash from Official Public Account for:
          - Appropriations			280		303	
Cash to Official Public Account for:
          - Appropriations
			
(1,980)		
(626)	
Cash and cash equivalents at the end of reporting period			-		-	
						
This schedule should be read in conjunction with the accompanying notes	

Schedule of Administered Commitments	
as at 30 June 2012	

There were no administered commitments as at 30 June 2012 (2011: Nil).

Schedule of Administered Contingencies	
as at 30 June 2012	

There were no administered contingencies as at 30 June 2012 (2011: Nil).

ADMINISTRATIVE APPEALS TRIBUNAL

Note 1: Summary of Significant Accounting Policies

1.1	Objectives of the Tribunal

The Administrative Appeals Tribunal (the Tribunal) is an Australian Government controlled entity. It is a not for profit entity.  The objective and sole outcome of the Tribunal is to provide independent review on merit of a wide range of administrative decisions of the Australian Government so as to ensure in each case the correct or preferable decision is made.

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

Tribunal activities contributing toward this outcome are classified as either departmental or administered.  Departmental activities involve the use of assets, liabilities, revenues and expenses controlled or incurred by the Tribunal in its own right.  Administered activities involve the management or oversight by the Tribunal, on behalf of the Government, of items controlled or incurred by the Government.

The Tribunal’s administered activities on behalf of the Government are generally limited to collection and refund of application fees as prescribed by the Administrative Appeals Tribunal Act 1975 and Regulations 1976. Additional administered revenues may be remitted by the Tribunal to Government where there is no right for the Tribunal to retain the revenue as Departmental revenue.

1.2	Basis of Preparation of the Financial Statements

The financial statements are general purpose financial statements and are required by section 49 of the Financial Management and Accountability Act 1997.  

The financial statements and notes have been prepared in accordance with:

•	Finance Minister's Orders (or FMOs) for reporting periods ending on or after 1 July 2011: and 
•	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 are 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 thousand dollars unless otherwise specified.

Unless 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 Tribunal 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 executor 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 Judgements and Estimates

In the process of applying the accounting policies listed in this note, the Tribunal has made a judgement that has the most significant impact on the amounts recorded in the financial statements: the fair value of property, plant and equipment has been taken to be the fair value of similar assets as determined by an independent valuer.

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

1.4 	New 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.  
The following amending standard, issued prior to the sign-off date, were applicable to the current reporting period and had a financial impact on the entity: 
•	Revised AASB 124 Related Party Disclosures and AASB 2009-12 Amendments to Australian Accounting Standards (effective for annual reporting periods beginning on or after 1 January 2011).
In December 2009 the AASB issued a revised AASB 124 Related Party Disclosures.  The amendment clarifies and simplifies the definition of a related party and removes the requirement for government-related entities to disclose details of all transactions with the government and other government-related entities. 
Other new standards, revised standards, interpretations and amending standards issued prior to the sign-off date and are applicable to the current reporting period did not have a financial impact, and are not expected to have a future financial impact on the entity.
Future Australian Accounting Standard Requirements
The following new standards, revised standards, interpretations and amending standards were issued by the Australian Accounting Standards Board prior to the sign-off date, which are expected to have a financial impact on the Tribunal for future reporting periods:
•	AASB 13 Fair Value Measurement and AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13 (effective 1 January 2013)

AASB 13 was released in September 2011. It explains how to measure fair value and aims to enhance fair value disclosures. To facilitate this AASB 13 outlines how to measure fair value, but does not specify when it should be applied. Guidance on when fair value measurements are to be applied is specified in other standards. AASB 13 defines fair value as “the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date.” This value would not factor in entity specific intentions for the asset (e.g. whether the entity intends to hold or sell the asset).
Key features included in AASB 13 are: the requirement to value non-financial assets at their highest and best use; identification of a principal (or most advantageous) market; and disclosure of all fair value measurements based on the fair value hierarchy.  AASB 13 also introduces additional disclosures. It extends the fair value hierarchy disclosures previously required for financial instruments alone to all assets and liabilities carried at fair value.
The Tribunal has yet to determine which, if any, of its current measurement techniques will have to change as a result of the new guidance. It is therefore not possible to state the impact, if any, of the new rules on any of the amounts recognised in the financial statements. However, application of the new standard will impact the type of information disclosed in the notes to the financial statements.  This standard is not applicable until financial year 2013-14. 

•	Revised AASB 119 Employee Benefits, AASB 2011-10 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011) and AASB 2011-11 Amendments to AASB 119 (September 2011) arising from Reduced Disclosure Requirements (effective 1 January 2013)
In September 2011, the AASB released a revised standard on accounting for employee benefits. 
Key changes made to the accounting requirements include:
-	     the revised AASB 119 Employee Benefits introduces a single approach for the recognition and measurement of defined benefit plans. Previously, entities were permitted a number of measurement options, including the ability to defer some gains/losses into future periods via the corridor approach. Under the revised AASB 119, gains/losses are recognised in the period in which they occur, with actuarial changes recognised in other comprehensive income. Service costs are recognised in the profit or loss, including past service costs arising from a plan amendment, curtailment or settlement. Financing income/expense is also recognised in the profit or loss depending on whether the overall plan is in a surplus or deficit position. Any return on plan assets in excess of the discount rate is recognised in other comprehensive income.

-	disclosure requirements were also revised and include disclosure of fair value information for plan assets, sensitivity analysis for major assumptions and descriptions of the risks associated with the plan.

-	the recognition rules and definitions related to termination benefits have been revised, which could impact when entities recognise termination expenses within their financial statements.

-	short-term employee benefits are now defined as employee benefits that are expected to be settled wholly within twelve months after reporting date. Previously, short-term employee benefits were defined as employee benefits due to be settled within twelve months.

This standard is not applicable until financial year 2013-14. 

•	AASB 9: Financial Instruments and AASB 2009–11: Amendments to Australian Accounting Standards arising from AASB 9 [AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 121, 127, 128, 131, 132, 136, 139, 1023 & 1038 and Interpretations 10 & 12]  
(effective 1 January 2013) 
The changes made to accounting requirements include:
-	simplifying the classifications of financial assets into those carried at amortised cost and those carried at fair value;

-	removing the tainting rules associated with held-to-maturity assets;

-	requiring financial assets to be reclassified where there is a change in an entity’s business model as they are initially classified based on: (a) the objective of the entity’s business model for managing the financial assets; and (b) the characteristics of the contractual cash flows.
This standard is not applicable until financial year 2013-14.

•	AASB 1053 Application of Tiers of Australian Accounting Standards and AASB 2010-2 Amendments to Australian Accounting Standards arising from Reduced Disclosure Requirements 
(effective 1 July 2013)
On 30 June 2010 the AASB officially introduced a revised differential reporting framework in Australia. Under this framework, a two-tier differential reporting regime applies to all entities that prepare general purpose financial statements. The Administrative Appeals Tribunal has public accountability as defined in AASB 1053 and is therefore not eligible to adopt the new Australian Accounting Standards – Reduced Disclosure Requirements. As a consequence, the two standards will have no impact on the financial statements of the entity. 

•	AASB 2011-9 Amendments to Australian Accounting Standards – Presentation of Items of Other Comprehensive Income (effective 1 July 2012)
In September 2011, the AASB made an amendment to AASB 101 Presentation of Financial Statements which requires entities to separate items presented in other comprehensive income into two groups, based on whether they may be recycled to profit or loss in the future. This will not affect the measurement of any of the items recognised in the balance sheet or the profit or loss in the current period.  The Tribunal intends to adopt the new standard from 1 July 2012. 

Other new standards, revised standards, interpretations and amending standards that were issued prior to the sign-off date and are applicable to the future reporting period are not expected to have a future financial impact on the Tribunal.

1.5	Revenue

Revenue from the sale of goods is recognised when: 
•	the risks and rewards of ownership have been transferred to the buyer;
•	the Tribunal retains no managerial involvement nor effective control over the goods;
•	the revenue and transaction costs incurred can be reliably measured; and
•	it is probable that the economic benefits associated with the transaction will flow to the Tribunal.  

Revenue from the rendering of services is recognised by reference to the stage of completion of contracts at the reporting date.  The revenue is recognised when:
•	the amount of revenue, stage of completion and transaction costs incurred can be reliably measured; and
•	the probable economic benefits associated with the transaction will flow to the Tribunal.

The stage of completion of contracts at the reporting date is determined by reference to:
•	surveys of work performed;
•	services performed to date as a percentage of total services to be performed; or
•	the proportion that costs incurred to date bear to the estimated total costs of the transaction.

Receivables for goods and services, which have 30 day terms, are recognised at their nominal amounts due less any impairment allowance account. Collectability of debts is reviewed at end of the reporting period. Allowances are made when collectability of the debt is no longer probable.  

Interest revenue is recognised using the effective interest method as set out in AASB 139 Financial Instruments: Recognition and Measurement. 

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.

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 Tribunal 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, unless received from another Government Agency or Authority as a consequence of a restructuring of administrative arrangements (Refer to Note 1.7).

Sale of Assets
Gains, from disposal of non-current assets, are recognised when control of the asset has passed to the buyer.

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 (DCBs) are recognised directly in contributed equity in that year.
 
Restructuring of Administrative Arrangements  
Net assets received from or relinquished to another Australian Government entity under a restructuring of administrative arrangement are adjusted at their book value directly against contributed equity.

Other distributions to owners
The FMOs require that distributions to owners be debited to contributed equity unless it is in the nature of a dividend.

1.8	Employee Benefits

Liabilities for ‘short-term employee benefits’ (as defined in AASB 119 Employee Benefits) and termination benefits due within twelve months of 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 Tribunal 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 applied at the time the leave is taken, including the Tribunal’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 liability for long service leave is recognised and measured, using the short-hand method included in the FMOs, at the present value of the estimated future cash flows to be made in respect of all employees at 30 June 2012.  The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and Redundancy 
Provision is made for separations and redundancy benefit payments.  The Tribunal recognises a provision for termination when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.

Superannuation
Most members and staff of the Tribunal are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS) and the PSS accumulation plan (PSSap).  

The CSS and PSS are defined benefit schemes for the Australian Government.  The PSSap is a defined contribution scheme.

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 in the Department of Finance and Deregulation’s administered schedule and notes.

The Tribunal makes employer contributions to the employee superannuation schemes at rates determined by an actuary to be sufficient to meet the cost to the Government of the superannuation entitlements of the Tribunal’s employees.  The Tribunal accounts for the contributions as if they were contributions to defined contribution plans.

The liability for superannuation recognised 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.  

The Tribunal does not have any finance leases.  Operating lease payments are expensed on a straight line basis which is representative of the pattern of benefits derived from the leased assets.

1.10	Borrowing Costs 
All borrowing costs are expensed as incurred. 

1.11	 Cash
Cash is recognised at its nominal amount. Cash and cash equivalents includes;
•	cash on hand;
•	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; 
•	cash held with outsiders; and
•	cash held in special accounts. 

1.12	 Financial Assets

The Tribunal’s financial assets are all classified 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 except for financial assets that are recognised at fair value through profit or loss.

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’. Loans and 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 period.

Financial assets carried at cost - if there is objective evidence that an impairment loss has been incurred, the amount of the impairment loss is the difference between the carrying amount of the asset and the present value of the estimated future cash flows discounted at the current market rate for similar assets.

1.13	Financial Liabilities

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

Financial liabilities at fair value through profit or loss
Financial liabilities at fair value through profit or loss are initially measured at fair value.  Subsequent fair value adjustments are recognised in profit or loss.  The net gain or loss recognised in profit or loss incorporates any interest paid on the financial liability.

Other financial liabilities
Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These financial liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.  

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

Supplier and other payables are recognised at amortised cost.  Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

1.14	Contingent Liabilities and Contingent Assets

Contingent liabilities and contingent assets 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 a liability or asset, or 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.  

1.15 	Financial Guarantee Contracts

Financial guarantee contracts are accounted for in accordance with AASB139 Financial Instruments: Recognition and Measurement.  They are not treated as a contingent liability, as they are regarded as financial instruments outside the scope of AASB137 Provisions, Contingent Liabilities and Contingent Assets.  The Tribunal currently has no financial guarantee contracts.

1.16	Acquisition of Assets

Assets are recorded at cost on acquisition except as stated below.  The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken.  Financial assets are initially measured at their fair value plus transaction costs where appropriate.  

Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and revenues at their fair value at the date of acquisition, unless acquired as a consequence of restructuring of administrative arrangements.  In the latter case, assets are initially recognised as contributions by owners at the amounts at which they were recognised in the transferor agency’s accounts immediately prior to the restructuring.

1.17	Leasehold Improvements, Plant and Equipment

Asset Recognition Threshold
Purchases of leasehold improvements, plant and equipment are recognised initially at cost in the balance sheet, except for purchases costing less than $2,000, which are expensed in the year of acquisition (other than where they form part of a group of similar items which are significant in total).  

The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located.  This is particularly relevant to ‘make-good’ provisions in property leases taken up by the Tribunal where there exists an obligation to restore the property to its original condition.  These costs are included in the value of the Tribunal’s leasehold improvements with a corresponding provision for the ‘make-good’ recognised.
 
Revaluations 
Fair values for each class of asset are determined as shown below:

Asset class	Fair value measurement	
Leasehold improvements	Depreciated replacement cost	
Plant and equipment	Market selling price	

The Tribunal does not own any land or buildings.

Following initial recognition at cost, plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not materially differ with the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.

Revaluation adjustments were made on a class basis.  Any revaluation increment was credited to equity under the heading of asset revaluation reserve except to the extent that it reversed a previous revaluation decrement of the same asset class that was previously recognised in the surplus/deficit. Revaluation decrements for a class of assets were recognised directly in the surplus/deficit except to the extent that they reversed a previous revaluation increment for that class.

Any accumulated depreciation as at the revaluation date is eliminated against the gross carrying amount of the asset and the asset restated at the revalued amount.

Depreciation
Depreciable plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to the Tribunal using, in all cases, the straight-line method of depreciation.  Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease.

Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate.

Depreciation rates applying to each class of depreciable asset are based on the following useful lives: 

	2012   	2011	
Leasehold improvements  	Lesser of estimated useful life and lease term	Lesser of estimated useful life and lease term	
Plant and equipment	3-20 years	3-20 years	

Impairment
All assets were assessed for impairment at 30 June 2012.  Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.

The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use.  Value in use is the present value of the future cash flows expected to be derived from the asset.  Where the future economic benefit of an asset is not primarily dependent of the asset’s ability to generate future cash flows, and the asset would be replaced if the Tribunal were deprived of the asset, its value in use is taken to be its depreciated replacement cost.

No indicators of impairment were found for assets at fair value.

Derecognition
An item of leasehold improvement, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

1.18	Intangibles

The Tribunal’s intangibles comprise externally purchased software for internal use.  These assets are carried at cost less accumulated amortisation and accumulated impairment losses.  

Software is amortised on a straight-line basis over its anticipated useful lives.  The useful lives of the Tribunal’s software are 3 to 5 years (2011: 3 to 5 years).

All software assets were assessed for indications of impairment as at 30 June 2012.  No indications of impairment were found for intangible assets.
1.19	Taxation

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

Revenues, expenses and assets are recognised net of GST except: 
•	where the amount of GST incurred is not recoverable from the Australian Taxation Office; and 
•	for receivables and payables.

1.20	Reporting of Administered Activities

Administered revenues, expenses, assets, liabilities and cash flows are disclosed in the schedule of administered items and related notes.  

Except where otherwise stated below, administered items are accounted for on the same basis and using the same policies as for departmental items, including the application of Australian Accounting Standards.

Administered Cash Transfers to and from Official Public Account
Revenue collected by the Tribunal for use by the Government rather than the Tribunal is administered revenue.  Collections are transferred to the Official Public Account (OPA) maintained by the Department of Finance and Deregulation.  Conversely, cash is drawn from the OPA to make payments under Parliamentary appropriation on behalf of Government.  These transfers to and from the OPA are adjustments to the administered cash held by the Tribunal on behalf of the Government and reported as such in the schedule of administered cash flows and in the administered reconciliation schedule.  

Administered Revenue
All administered revenues are revenues relating to ordinary activities performed by the Tribunal on behalf of the Australian Government. As such, administered appropriations are not revenues of the individual entity that oversees distribution or expenditure of the funds as required by regulations 19 and 19AA of the Administrative Appeals Regulations 1976.

The major financial activities of the Tribunal are the collection of fees payable on lodging with the Tribunal of an application for a review of a decision, other than in income maintenance matters.  On matters other than income maintenance, applicants may apply for a waiver of the fee under regulation 19(6) of the Administrative Appeals Tribunal Regulations 1976.

Applications deemed to be successful may result in a refund of the fee paid.

Fees are refunded in whole if lodged prior to November 1, 2010 or less $100 if lodged from November 1, 2010 where the proceedings terminate in a manner favourable to the applicant except for Small Taxation Claims Tribunal applications where a smaller once-only fee is payable irrespective of the outcome of the decision.

Note 2: Events after the Reporting Period

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

Note 3: Expenses	
2012 
 $’000 		
2011 
 $’000 	
Note 3A: Employee benefits
Wages and salaries	16,954		16,461	
Superannuation				
       Defined contribution plans	888		811	
       Defined benefit plans	1,743		1,965	
Leave and other entitlements	2,055		2,282	
Separation and redundancies	52		53	
Total employee benefits	21,692		21,572	
 
Note 3B: Suppliers
Goods and services				
General suppliers	5,180		5,027	
Other property costs	2,349		2,361	
Total goods and services	7,529		7,388	
				
Goods and Services are made up of:				
Provision of goods - external parties	368		368	
Rendering of services - related entities	498		451	
Rendering of services - external parties	6,663		6,569	
Total goods and services	7,529		7,388	
				
Other supplier expenses				
Operating lease rentals – external parties:
       Minimum lease payments	
5,411		
 5,383	
Workers compensation expenses	104		104	
Total other supplier expenses	5,515		5,487	
Total supplier expenses	13,044		12,875 	

	2012 
 $’000 		2011 
 $’000 	
Note 3C: Depreciation and Amortisation
Depreciation:				
Leasehold improvements, plant and equipment	
1,705		
1,589	
Total depreciation	1,705		1,589	
Amortisation:
Intangibles	181		211	
Total amortisation	181		211	
Total depreciation and amortisation	1,886		1,800	

Note 3D: Losses from assets sales
Plant and equipment				
       Carrying value of assets sold	2		18	
Total losses from assets sales	2		18	

Note 4: Income

OWN-SOURCE REVENUE

Note 4A: Sale of Goods and Rendering of Services
Rendering of services - related entities	874		777	
Rendering of services - external parties	477		339	
Total sale of goods and rendering of services	1,351		1,116	

GAINS

Note 4B: Other gains
Resources received free of charge - services	38		37	
Liabilities assumed by other departments	275		207	
Total other gains	313		244	

REVENUE FROM GOVERNMENT

Note 4C: Revenue from Government
Appropriations:
           Departmental appropriations	
34,579		
32,732	
Total revenue from Government	34,579		32,732	

	2012
$’000		2011
$’000	
Note 5: Financial Assets

Note 5A: Cash and cash equivalents
Cash on hand or on deposit	283		98	
Total cash and cash equivalents	283		98	
				
Note 5B: Trade and Other receivables				
Goods and services – related entities	238		100	
Goods and services – external parties	95		28	
Total receivables for goods and services	333		128	
				
Appropriations receivable:				
        For existing programs	10,900		9,600	
Total appropriations receivable	10,900		9,600	
				
Other receivables:				
        GST receivable from the Australian                 Taxation Office	
147		
231	
Total other receivables	147		231	
Total trade and other receivables (Net)	11,380		9,959	

No impairment has been recognised in 2012 (2011:Nil).

Receivables are expected to be recovered in:
No more than 12 months	11,380		9,959	
More than 12 months	-		-	
Total trade and other receivables (net)	11,380		9,959	

Receivables are aged as follows:
Not overdue	11,368		9,948	
Overdue by:				
           0 to 30 days	4		8	
           31 to 60 days	4		2	
           61 to 90 days	3		1	
           More than 90 days	1		-	
	12		11	
Total receivables (gross)	11,380		9,959	

Credit terms for goods and services were within 30 days (2011: 30 days).

Note 6: Non-Financial Assets

Note 6A: Leasehold Improvements
Leasehold improvements at fair value	4,705		5,587	
Total leasehold improvements	4,705		5,587	

No indicators of impairment were found for leasehold improvements.
No leasehold improvements are expected to be sold or disposed of within the next 12 months.

	2012 
 $’000		2011 
 $’000	
Note 6B: Plant and Equipment 
Plant and equipment at fair value	1,438		1,633	
Total plant and equipment	1,438		1,633	

No indicators of impairment were found for plant and equipment.

No plant and equipment is expected to be sold or disposed of within the next 12 months other than where items are being replaced at the end of useful life with similar assets in the ordinary course of business.

Revaluations of non-financial assets

All revaluations are in accordance with the revaluation policy stated in Note 1.16.  On 30 June 2012, an independent valuer, Australian Valuation Office, conducted the revaluations. 

A revaluation increment of $323,142 for leasehold improvements was credited to the asset revaluation  reserve by asset class and included in the equity section of the balance sheet (2011 increment $92,803). 

A revaluation increment of $2,044 for plant and equipment was credited to the asset revaluation reserve by asset class and included in the equity section of the balance sheet (2011 increment  $30,625).

Note 6C:  Reconciliation of the Opening and Closing Balances of Leasehold Improvements, Plant and Equipment (2011-12)

	            Leasehold             Improvements 

$'000	             Plant and                 Equipment

$'000	Total

$'000	
As at 1 July 2011				
     Gross book value	5,587	1,633	7,220	
     Accumulated depreciation and impairment	-	-	-	
     Net book value 1 July 2011	5,587	1,633	7,220	
Additions				
	By purchase 	40	265	305	
				
Revaluations and impairments recognised in other comprehensive income	
323	
2	
325	
Revaluations and impairment  recognised in the operating result	
-	
-	
-	
Depreciation expense	(1,245)	(460)	(1,705)	
Disposals: 				
     Other 	-	(2)	(2)	
Net book value 30 June 2012	4,705	1,438	6,143	
				
Net book value as at 30 June 2012 represented by: 				
Gross book value	4,705	1,438	6,143	
Accumulated depreciation and impairment	-	-	-	
Net book value 30 June 2012	4,705	1,438	6,143	

Note 6C (Cont’d) : Reconciliation of the Opening and Closing Balances of Leasehold Improvements,  Plant and Equipment (2010-11)

	Leasehold Improvements 

$’000	Plant and Equipment

$’000	Total

$’000	
As at 1 July 2010				
     Gross book value	6,642	1,448	8,090	
     Accumulated depreciation and impairment	-	-	-	
     Net book value 1 July 2010	6,642	1,448	8,090	
Additions				
	By purchase 	65	549	614	
				
Revaluations and impairments recognised in other comprehensive income	
93	
30	
123	
Revaluations and impairment  recognised in the operating result	
-	
-	
-	
Depreciation expense	(1,213)	(376)	(1,589)	
Disposals: 				
     Other 	-	(18)	(18)	
Net book value 30 June 2011	5,587	1,633	7,220	
				
Net book value as at 30 June 2011 represented by: 				
Gross book value	5,587	1,633	7,220	
Accumulated depreciation and impairment	-	-	-	
Net book value 30 June 2011	5,587	1,633	7,220	

	2012 
 $’000 		2011 
 $’000 	
Note 6D: Intangibles				
Computer software 				
     Purchased      	990		1,863	
     Accumulated amortisation	(742)		(1,434)	
Total computer software	248		429	
Total intangibles	248		429	

No indicators of impairment were found for intangible assets.
No intangibles are expected to be sold or disposed of within the next 12 months.

Note 6E : Reconciliation of the opening and closing balances of Intangibles (2011-12).

Item	Computer software    purchased
$'000	Total

$'000	
As at 1 July 2011			
     Gross book value	990	990	
     Accumulated amortisation
     and impairment	
(561)	
(561)	
     Net book value 1 July 2011	429	429	
Additions 			
By purchase or internally developed	-	-	
			
Amortisation	(181)	(181)	
Write-off 			
     Gross value of assets written off	-	-	
     Accumulated depreciation	-	-	
Net book value 30 June 2012	248	248	

Net book value as of 30 June 2012 represented by:			
     Gross book value	990	990	
     Accumulated amortisation
     and impairment	
(742)	
(742)	
Net book value 30 June 2012	248	248	

Note 6E (Cont’d) : Reconciliation of the opening and closing balances of intangibles (2010-11).

Item	Computer software             purchased
$'000	Total

$'000	
As at 1 July 2010			
     Gross book value	1,653	1,653	
     Accumulated amortisation
     and impairment	
(1,223)	
(1,223)	
     Net book value 1 July 2010	430	430	
Additions 			
By purchase or internally developed	210	210	
			
Amortisation	(211)	(211)	
Write-off 			
     Gross value of assets written off	(873)	(873)	
     Accumulated depreciation	873	873	
Net book value 30 June 2011	429	429	

Net book value as of 30 June 2011 represented by:			
     Gross book value	990	990	
     Accumulated amortisation
     and impairment	
(561)	
(561)	
Net book value 30 June 2011	429	429	

	2012 
 $’000 		2011 
 $’000 	

Note 6F: Other non-financial assets 
Prepayments	346		495	
Total other non-financial assets	346		495	

Total other non-financial assets – are expected to be recovered in:				
    No more than 12 months	346		495	
Total other non-financial assets	346		495	

No indicators of impairment were found for other non-financial assets.

Note 7: Payables

Note 7A: Suppliers
Trade creditors and accruals	661		1,177	
Total suppliers payables	661		1,177	

Suppliers payables expected to be settled within 12 months:				
     Related entities	99		26	
     External parties	562		1,151	
Total suppliers payables 	661		1,177	

Settlement was usually made within 30 days.

Note 8: Interest Bearing Liabilities 

Note 8A: Other interest bearing liabilities
Lease incentives 1	813		837	
Total other interest bearing liabilities	
813		
837	

Interest bearing liabilities are expected to be settled in:
     No more than 12 months	108		15	
     More than 12 months	705		822	
Total interest bearing liabilities	813		837	

1.	The Tribunal received incentives in the form of rent free periods and carpeting contributions on entering property operating leases.

	2012 
 $’000 		2011 
 $’000 	
Note 9: Provisions

Note 9A: Employee provisions
Leave	4,617		4,684	
Other	1,454		1,398	
Total employee provisions	6,071		6,082	
				
Employee provisions are expected to be settled in:				
     No more than 12 months	5,264		5,408	
     More than 12 months	807		674	
Total employee provisions	6,071		6,082	

Note 9B: Other provisions
Provision for restoration obligations	480		420	
Total other provisions	480		420 	
				
Other provisions are expected to be settled in:				
     More than 12 months	480		420	
Total other provisions	480		420	

	Provision for
restoration
$’000		Total

$’000	
Carrying amount 1 July 2011	420		420	
     Additional provisions made	60		60	
     Amount used	-		-	
     Amounts reversed	-		-	
     Unwinding of discount or change in the       discount rate	
-		
-	
Closing balance 2012	480		480	

The Tribunal currently has two agreements for the leasing of premises which have provisions requiring the Tribunal to restore the premises to their original condition at the conclusion of the lease.  The Tribunal has made a provision to reflect the present value of this obligation.

Note 10: Cash Flow Reconciliation

Reconciliation of cash and cash equivalents as per Balance Sheet to Cash Flow Statement
	2012
$’000		2011
$’000	
Cash and cash equivalents as per:				
Cash Flow Statement	283		98	
Balance Sheet 	283		98	
Difference	-		-	

Reconciliation of net cost of services to net cash from operating activities:
Net cost of services	(34,960)		(34,905)	
Add revenue from Government	34,579		32,732	
				
Adjustments for non-cash items				
Depreciation/amortisation 	1,886		1,800	
Loss on disposal of assets	2		18	
				
Changes in assets/liabilities				
(Increase)/decrease in net receivables	(1,421)		(1,666)	
(Increase)/decrease in prepayments	149		1,124	
Increase/(decrease) in employee provisions	(11)		192	
Increase/(decrease) in suppliers payables	(516)		60	
Increase/(decrease) in other payables     	(24)		59	
Net cash (used by) operating activities 	(316)		(586)	

Note 11: Contingent Assets and Liabilities

Quantifiable Contingencies 
At 30 June 2012, the Tribunal had no quantifiable contingent liabilities (2011: Nil).  

Unquantifiable or Remote Contingencies
At 30 June 2012, the Tribunal had not identified any unquantifiable or remote contingencies (2011: Nil).  

Note 12: Senior Executive Remuneration

Note 12A: Senior Executive Remuneration Expenses for the Reporting Period

	2012		2011	
Short-term employee benefits:				
     Salary 	547,668		433,995	
     Annual leave accrued	38,320		36,165	
     Performance bonuses	-		10,997	
     Motor vehicle and other allowances	-		121,590	
Total short-term employee benefits	585,988		602,747	

Post-employment benefits:
     Superannuation 	

54,380		

65,570	
Total post-employment benefits	54,380		65,570	

Other long term benefits
     Long-service leave	

23,344		

10,850	
Total other long term benefits	23,344		10,850	

Total employment benefits	
663,712		
679,167	

Notes:	
1. Note 12A was prepared on an accrual basis (so the performance bonus expenses disclosed above differ from the cash 'Bonus paid' in Note 12B).	
2. Note 12A excludes acting arrangements and part-year service where remuneration expensed for a senior executive was less than $150,000. 	

Note 12B: Average Annual Remuneration Paid to Substantive Senior Executives During the Reporting Period
	2012	

Average annual reportable remuneration1	
Senior
Executives
No.	
Reportable salary2
$	
Contributed superannuation3
$	
Reportable allowances4
$	
Bonus Paid5

$	
Total

$	
Total remuneration (including part-time arrangements):							
$0 to $149,999	2	82,635	7,860	-	-	90,495	
$270,000 to $299,999	1	261,769	27,915	-	-	289,684	
Total	3						
		
	2011	

Average annual reportable remuneration1	
Senior
Executives
No.	
Reportable salary2
$	
Contributed superannuation3
$	
Reportable allowances4
$	
Bonus Paid5

$	
Total

$	
Total remuneration (including part-time arrangements):							
$150,000 to  $179,999	1	151,262	17,823	-	8,065	177,150	
$210,000 to $239,999	1	202,384	27,966	3,978	-	234,328	
Total	2						

Notes:
1. This table reports substantive senior executives who received remuneration during the reporting period.  Each row is an average figure based on headcount for individuals in the band.
2. ‘Reportable salary’ includes the following:
     a) gross payments (less any bonuses paid, which are separated out and disclosed in the ‘bonus paid’ column);
     b) reportable fringe benefits (at the net amount prior to ‘grossing up’ to account for tax benefits); and
     c) exempt foreign employment income.
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 ‘Bonus paid’ represents average actual bonuses paid during the reporting period in that reportable remuneration band.  The ‘bonus paid’ within a particular band may vary between financial years due to various factors such as individuals commencing with or leaving the entity during the financial year.
6. Various salary sacrifice arrangements were available to senior executives including superannuation, motor vehicles and expense payment fringe benefits.  Salary sacrifice benefits are reported in the ‘reportable salary’ column, excluding salary sacrificed superannuation, which is reported in the ‘contributed superannuation’ column.

Note 12C: Other Highly Paid Staff

	2012	

Average annual reportable remuneration1	
Staff
No.	
Reportable salary2
$	
Contributed superannuation3
$	
Reportable allowances4
$	 
     Bonus Paid5

$	
Total

$	
Total remuneration (including part-time arrangements):							
$150,000 to  $179,999	2	108,117	42,903	-	4,555	155,575	
$180,000 to $209,999	2	172,699	24,644	-	-	197,343	
$240,000 to $269,999	2	237,894	26,715	-	-	264,609	
$300,000 to $329,999	6	279,187	43,314	-	-	322,501	
$330,000 to $359,999	2	292,149	47,891	216	-	340,256	
$390,000 to $419,999	3	359,031	56,045	155	-	415,231	
$420,000 to $449,999	3	362,267	67,418	75	-	429,760	
$780,000 to $809,999	1	781,309	-	-	-	781,309	
Total	21						
		
	2011	

Average annual reportable remuneration1	
Staff
No.	
Reportable salary2
$	
Contributed superannuation3
$	
Reportable allowances4
$	
Bonus Paid5

$	
Total

$	
Total remuneration (including part-time arrangements):							
$150,000 to  $179,999	2	127,684	24,550	117	-	152,351	
$180,000 to $209,999	5	154,627	34,884	554	2,046	192,111	
$210,000 to $239,999	1	199,074	29,393	-	-	228,467	
$240,000 to $269,999	2	203,701	39,834	11,136	-	254,671	
$270,000 to $299,999	8	230,741	43,830	16,172	-	290,743	
$360,000 to $389,999	5	283,217	64,224	20,220	-	367,661	
$390,000 to $419,999	1	371,954	-	41,573	-	413,527	
$420,000 to $449,999	1	318,760	90,665	12,337	-	421,762	
Total	25						

Notes:
1. This table reports staff:
     a) who were employed by the Tribunal during the reporting period;
     b) whose reportable remuneration was $150,000 or more for the financial period; and
     c) were not required to be disclosed in Tables A or B disclosures.  
Each row is an averaged figure based on headcount for individuals in the band. 
2. ‘Reportable salary’ includes the following:
     a) gross payments (less any bonuses paid, which are separated out and disclosed in the ‘bonus paid’ column);
     b) reportable fringe benefits (at the net amount prior to ‘grossing up’ to account for tax benefits); and
     c) exempt foreign employment income.
3. The ‘contributed superannuation’ amount is the average actual superannuation contributions paid to staff 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 ‘Bonus paid’ represents average actual bonuses paid during the reporting period in that reportable remuneration band.  The ‘bonus paid’ within a particular band may vary between financial years due to various factors such as individuals commencing with or leaving the entity during the financial year.
6. Various salary sacrifice arrangements were available to other highly paid staff including superannuation, motor vehicles and expense payment fringe benefits.  Salary sacrifice benefits are reported in the ‘reportable salary’ column, excluding salary sacrificed superannuation, which is reported in the ‘contributed superannuation’ column.

Note 13: Remuneration of Auditors
	2012 
 $’000 		2011 
$’000 	
Financial statement audit services were provided free of charge to the Tribunal by the Australian National Audit Office (ANAO).				

Fair value of the financial statements audit services provided	
38		
37	
Total	38		37	

Note 14: Financial Instruments

Note 14A: Categories of financial instruments

Financial assets
Loans and receivables
    Cash and cash equivalents	283		98	
    Trade receivables	333		128	
Total	616		226	
Carrying amount of financial assets	616		226	

Financial liabilities
At amortised cost:
    Payables - suppliers	661		1,177	
    Other interest bearing liabilities	813		837	
Total	1,474		2,014	
Carrying amount of financial liabilities	1,474		2,014	

There is no expected difference between the carrying amounts of the above financial assets and liabilities and the fair value as all financial assets are expected to be converted to cash or cash equivalents and financial liabilities paid in full.

Note 14B: Net income and expense from financial assets

The Tribunal had no income or expense in relation to financial assets in the year ending 30 June 2012 (2011: Nil)

Note 14C: Net income and expense from financial liabilities

The Tribunal had no income or expense in relation to financial liabilities in the year ending 30 June 2012 (2011: Nil)

Note 14D: Credit risk

The Tribunal is exposed to minimal credit risk as loans and receivables are cash and trade receivables.  The maximum exposure to credit risk is the risk that arises from potential default of a debtor.  This amount is equal to the total amount of trade receivables (2012: $332,213 and 2011: $127,970).  The Tribunal has assessed the risk of the default on payment and has allocated nil in 2012 (2011: Nil) to an impairment allowance account.

The Tribunal manages its credit risk by limiting the extension of credit to customers, acting promptly to recover past due amounts and withholding credit from defaulting customers until accounts are returned to normal terms.  In addition, the Tribunal has policies and procedures that guide employees debt recovery activities including the use of debt collection agents if required.

The Tribunal has no significant exposures to any concentrations of credit risk with particular customers and does therefore not require collateral to mitigate against credit risks.

Credit quality of financial instruments not past due or individually determined as impaired.
	Not Past Due Nor Impaired
2012
$’000	Not Past Due Nor Impaired
2011
$’000	Past Due 
or 
Impaired
2012
$’000	Past Due 
or 
Impaired
2011
$’000	
   Cash and cash equivalents	283	98	-	-	
   Receivables for goods and services	321	117	12	11	
Total	604	215	12	11	

Ageing of financial assets that were past due but not impaired for 2012
	0 to 30
days
$’000	31 to 60
days
$’000	61 to 90
days
$’000	90+
days
$’000	
Total
$’000	
   Receivables for goods and services	4	4	3	1	12	
Total	4	4	3	1	12	

Ageing of financial assets that were past due but not impaired for 2011
	0 to 30
days
$’000	31 to 60
days
$’000	61 to 90
days
$’000	90+
days
$’000	
Total
$’000	
   Receivables for goods and services	8	2	1	-	11	
Total	8	2	1	-	11 	

Note 14E: Liquidity risk

The Tribunal’s financial liabilities are supplier payables.  The exposure to liquidity risk is based on the notion that the Tribunal will encounter difficulty in meeting its obligations associated with financial liabilities.  This is highly unlikely due to appropriation funding and mechanisms available to the Tribunal (e.g. Advance to the Finance Minister) and internal policies and procedures put in place to ensure there are appropriate resources to meet its financial obligations.  The Tribunal is appropriated funding from the Australian Government and manages its budgeted funds to ensure it is able to meet payments as they fall due.  Policies are in place to ensure timely payments are made when due and there have been no past experience of default.

Maturities for non-derivative financial liabilities 2012:
	On
demand
$’000	Within 1
year
$’000	1 to 2
years
$’000	2 to 5
years
$’000	> 5
years
$’000	
Total
$’000	
   Suppliers	-	661	-	-	-	661	
   Other interest bearing liabilities	-	108	519	186	-	813	
Total	-	661	519	186	-	1,474	

Maturities for non-derivative financial liabilities 2011:
	On
demand
$’000	Within 1
year
$’000	1 to 2
years
$’000	2 to 5
years
$’000	> 5
years
$’000	
Total
$’000	
   Suppliers	-	1,177	-	-	-	1,177	
   Other interest bearing liabilities	-	15	334	488	-	837	
Total	-	1,192	334	488	-	2,014	

The entity had no derivative financial liabilities in either 2012 or 2011.

Note 14F: Market risk

The Tribunal held basic financial instruments that did not expose it to certain market risks, such as 'Currency risk', ‘Interest rate risk’ or 'Other price risk'.

Note 15: Financial Assets Reconciliation

	
Notes	2012
$’000		2011
$’000	
Financial Assets					
					
Total financial assets as per balance sheet		11,663		10,057	
Less: non-financial instruments components:					
   Appropriations receivable	5B	10,900		9,600	
   GST receivable	5B	147		231	
Total non-financial instrument components		11,047		9,831	
Total financial assets as per financial instruments note		616		226	

Note 16: Administered – Cash Flow Reconciliation
	
	2012
$'000		2011
$'000	
Reconciliation of cash and cash equivalents as per Administered Schedule of Assets and Liabilities to Administered Cash Flow Statement
				
Cash and cash equivalents as per:	-		-	
     Schedule of administered cash flows	-		-	
     Schedule of administered assets and liabilities	-		-	
Difference	-		-	

Reconciliation of net cost of services to net cash from operating activities:
Net cost of services	1,700		323	
Net cash (used by) operating activities 	1,700		323	

Note 17: Administered - Contingent Assets and Liabilities	

There were no administered contingent assets or liabilities as at 30 June 2012 (2011: Nil).

Note 18: Appropriations

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

	2012 Appropriations			
	Appropriation Act	FMA Act		Appropriation applied in 2012 (current and prior years)
$’000		
	
Annual Appropriations
$’000	
Appropriations Reduced(1)
$’000	
AFM(2)

$’000 	
Section 30

$’000	
Section 31

$’000	
Section 32

$’000	
Total Appropriation
$’000		Variance 

$’000	
DEPARTMENTAL
   Ordinary annual services (3)
	
35,385
	
-
	
-
	
-
	
1,425
	
-
	
36,810
	
(35,325)
	
1,485
	
Total Departmental	35,385	-	-	-	1,425	-	36,810	(35,325)	1,485	
ADMINISTERED
   Ordinary annual services
	
-
	
-
	
-
	
-
	
XXXXXX
	
-
	
-
	
-
	
-
	
Total Administered	-	-	-	-	XXXXXX	-	-	-	-	

Notes:
1.	Appropriations reduced under Appropriation Acts (No. 1,3,5) 2011-12: sections 10, 11, 12 and 15 and under Appropriation Acts (No. 2,4,6) 2011-12: sections 12,13, 14 and 17. Departmental appropriations do not lapse at financial year-end. However, the responsible Minister may decide that part or all of a departmental appropriation is not required and request the Finance Minister to reduce that appropriation. The reduction in the appropriation is effected by the Finance Minister's determination and is disallowable by Parliament.  In 2012, there was no reduction in departmental appropriations for the Tribunal. 
2.	Advance to the Finance Minister (AFM) - Appropriation Acts (No. 1,3,5) 2011-12: section 13 and Appropriation Acts (No. 2,4,6) 2011-12: section 15.
3.	Variance is substantially attributable to cash under spend during the year and the timing of payments.

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

	2011 Appropriations			
	Appropriation Act	FMA Act		Appropriation applied in 2011 (current and prior years)
$’000		
	
Annual Appropriations
$’000	
Appropriations Reduced(1)
$’000	
AFM(2)

$’000 	
Section 30

$’000	
Section 31

$’000	
Section 32

$’000	
Total Appropriation
$’000		Variance 

$’000	
DEPARTMENTAL
   Ordinary annual services (3)
 	
33,479
	
-
	
-
	
32
	
1,029
	
-
	
34,540
	
(33,589)
	
951
	
Total Departmental	33,479	-	-	32	1,029	-	34,540	(33,589)	951	
ADMINISTERED
   Ordinary annual services
	
-
	
-
	
-
	
-
	
XXXXXX
	
-
	
-
	
-
	
-
	
Total Administered	-	-	-	-	XXXXXX	-	-	-	-	

Notes:
1.	Appropriations reduced under Appropriation Acts (No. 1,3,5) 2010-11: sections 10, 11, 12 and 15 and under Appropriation Acts (No. 2,4,6) 2010-11: sections 12,13, 14 and 17. Departmental appropriations do not lapse at financial year-end. However, the responsible Minister may decide that part or all of a departmental appropriation is not required and request the Finance Minister to reduce that appropriation. The reduction in the appropriation is effected by the Finance Minister's determination and is disallowable by Parliament.  In 2011 there was no reduction in departmental appropriations for the Tribunal. 
2.	Advance to the Finance Minister (AFM) - Appropriation Acts (No. 1,3,5) 2010-11: section 13 and Appropriation Acts (No. 2,4,6) 2010-11: section 15.
3.	Variance is substantially attributable to cash under spend during the year and the timing of payments.

Table B: Departmental Capital Budgets ('Recoverable GST exclusive')

	2012 Capital Budget Appropriations	Capital Budget Appropriations applied in 2012 (current and prior years)	

Variance 
$’000	
	Appropriation Act	FMA Act	
Total Capital Budget Appropriations
$’000 	
Payments for non-financial assets(3)
$’000	

Payments for other purposes
$’000	

Total payments $’000		
	Annual Capital Budget
$’000	
Appropriations Reduced(2)
$’000	
Section 32
$’000						
DEPARTMENTAL
   Ordinary annual services - Departmental Capital Budget(1)	

806	

-	

-	

806	

(305)	

-	

(305)	

501	
Total Departmental	806	-	-	806	(305)	-	(305)	501	

Notes:
1.	Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No. 1,3,5).  They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.  For more information on ordinary annual services appropriations, please see Table A: Annual appropriations.
2.	Appropriations reduced under Appropriation Acts (No. 1,3,5) 2011-12: sections 10, 11, 12 and 15 or via a determination by the Finance Minister.
3.	Payments made on non-financial assets include purchases of assets, expenditure on assets which has been capitalised, costs incurred to make good an asset to its original condition, and the capital repayment component of finance leases.  

	2011 Capital Budget Appropriations	Capital Budget Appropriations applied in 2011 (current and prior years)	

Variance 
$’000	
	Appropriation Act	FMA Act	
Total Capital Budget Appropriations
$’000 	
Payments for non-financial assets(3)
$’000	

Payments for other purposes
$’000	

Total payments $’000		
	Annual Capital Budget
$’000	
Appropriations Reduced(2)
$’000	
Section 32
$’000						
DEPARTMENTAL
   Ordinary annual services - Departmental Capital Budget(1)	

747	

-	

-	

747	

(789)	

-	

(789)	

(42)	
Total Departmental	747	-	-	747	(789)	-	(789)	(42)	

Notes:
1.	Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No. 1,3,5).  They form part of ordinary annual services, and are not separately identified in the Appropriation Acts.  For more information on ordinary annual services appropriations, please see Table A: Annual appropriations.
2.	Appropriations reduced under Appropriation Acts (No. 1,3,5) 2010-11: sections 10, 11, 12 and 15 or via a determination by the Finance Minister.
3.	Payments made on non-financial assets include purchases of assets, expenditure on assets which has been capitalised, costs incurred to make good an asset to its original condition, and the capital repayment component of finance leases.
1.	

Table C: Unspent Departmental Annual Appropriations ('Recoverable GST exclusive')

	2012	2011	
Authority	$’000	$’000	
Appropriation Act (No.1) 2010-11	2,200	9,600	
Appropriation Act (No.1) 2011-12	8,700	-	
Total 	10,900	9,600	

Table D: Special Appropriations ('Recoverable GST exclusive')

			2012	2011	
Authority	Type	Purpose	$’000	$’000	
Financial Management and Accountability Act 1997 s.28(2), Administered
	Refund	To provide an appropriation where an Act or other law requires or permits the repayment of an amount received by the Commonwealth and apart from this section there is no specific appropriation for the repayment.	280	303	
Total			280	303	

Note 19: Special Accounts

Other Trust Monies	2012
$’000	2011
$’000	
Appropriation: Financial Management and Accountability Act section 20
			
Establishing Instrument: Financial Management and Accountability Act 1997 
			
Purpose: For expenditure of monies temporarily held on trust or otherwise for the benefit of a person other than the Commonwealth.
			
Balance brought forward from previous period	-	-	
     Appropriation for reporting period	-	-	
     Other receipts	-	-	
Total Increase	-	-	
Available for payment	-	-	
      Payments made 	-	-	
Total decrease	-	-	
Total balance carried to next period	-	-	

The Tribunal’s Other Trust Monies Special Account was abolished by Financial Management and Accountability
(Abolition of 24 Special Accounts) Determination 2012/02 as of June 20, 2012 as it was no longer required.

Note 20: Compliance with Statutory Conditions for Payment 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. The possibility of this being an issue for the agency was reported in the notes to the 2010-11 financial statements and the agency undertook to investigate the issue during 2011-12.

During 2011-12, the agency developed a plan to review exposure to risks of not complying with statutory conditions on payments from appropriations.  The plan involved:

•	identifying each special appropriation; 
•	determining the risk of non-compliance by assessing the difficulty of administering the statutory conditions and assessing the extent to which existing payment systems and processes satisfy those conditions;
•	determining procedures to confirm risk assessments in medium risk cases and to quantify the extent of non-compliance, if any;
•	obtaining in-house legal advice as appropriate to resolve questions of potential non-compliance; and
•	considering legislative or procedural changes to reduce the risk of non-compliance in the future to an acceptably low level.
The agency identified one special appropriation involving statutory conditions for payment authorised by the Administrative Appeals Act 1975 and Regulations 1976 and funded pursuant to section 28 of the FMA Act 1997.

As at 30 June 2012 this work had been completed in respect of the appropriation with statutory conditions for payment representing $280,114 of administered expenditure in 2011-12.

The work conducted to date has identified no issues of compliance with Section 83 and internal assessment indicates that the risk of non-compliance is low.

Ongoing monitoring of the risk of breach will be continued in 2012-13 via the Tribunal’s internal audit programme.  In addition, the Tribunal will make minor modifications to Chief Executive Instructions and internal processes to further reduce the risk of breaches.

Note 21: Compensation and Debt Relief
	  2012 
 $ 		2011 
$ 	

Compensation and Debt Relief - Departmental				
No ‘Act of Grace’ payments were expensed during the reporting period (2011: 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 (2011: nil).	-	

	-	
No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period (2011: nil).  
	-		-	
No ex gratia payments were provided during the reporting period (2011: nil).  
	-		-	
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 (2011: nil) 	-		-	

Compensation and Debt Relief - Administered				
No ‘Act of Grace’ payments were expensed during the reporting period (2011: 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 (2011: nil).	-	

	-	
No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period (2011: nil).  
	-		-	
No ex gratia payments were provided during the reporting period (2011: nil).  
	-		-	
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 (2011: nil) 	-		-	

Note 22: Reporting of Outcomes

The Tribunal has only one outcome which is described in note 1.1 and all resources are used to deliver that outcome.

Note 22A: Net Cost of Outcome Delivery

	Total Outcome 1	
	2012
$'000	2011
$'000	
Departmental		
Expenses	(36,624)	(36,265)	
Own-source income	1,351	1,116	
Administered		
Expenses	(280)	(303)	
Own-source income	1,980	626	
Net cost/(contribution) of outcome delivery	(33,573)	(34,826)	

Note 23: Net Cash Appropriation Arrangements
	2012
$’000		2011
$’000	
			
Total comprehensive income (loss) less depreciation/amortisation expenses previously funded through revenue appropriations1 	
1,770		
(250)	
Plus: depreciation/amortisation expenses previously funded through revenue appropriation	
(1,886)		
(1,800)	
Total comprehensive income (loss) – as per the Statement of Comprehensive Income	
(116)		
(2,050)	

1. From 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.