Part 4: Financial statements (continued)

Notes to and forming part of the financial statements
for the period ended 30 June 2012

Note 26: Administered financial instruments

	2012 $'000	2011 $'000
Note 26A: Categories of financial instruments
Financial Assets
Loans and receivables:
Cash and cash equivalents	1,735	4,763
IMF related monies owing	277	950
Guarantee Scheme for Large Deposits and Wholesale Funding contractual fee receivable	1,064,144	1,825,935
Guarantee Scheme for Large Deposits and Wholesale Funding fee receivable	60,882	78,824
Guarantee of State and Territory Borrowing contractual fee receivable	265,960	301,920
Guarantee of State and Territory Borrowing fee receivable	4,738	5,998
IMF maintenance of value	-	342,113
IMF new arrangements to borrow loan	661,133	224,547
Loans to States and Territories	15,101	-
Dividends receivable	900,000	-
NDRRA receivables	-	128,643
Other receivables	17,577	13,900
Total loans and receivables	2,991,547	2,927,593
Available for sale:
International financial institutions	649,581	565,581
Australian Government entities	6,718,394	6,004,846
IMF Quota	4,797,510	4,813,206
Total available for sale	12,165,485	11,383,633
Carrying amount of financial assets	15,157,032	14,311,226
Financial Liabilities
At amortised cost:
Promissory notes	3,259,907	3,851,036
Grant liabilities	473,356	884,081
IMF SDR allocation liability	4,570,369	4,585,323
Other payables	974	3,987
Guarantee Scheme for Large Deposits and Wholesale funding contractual guarantee service obligation	1,064,144	1,825,935
Guarantee of State and Territory Borrowing contractual guarantee service obligation	265,960	301,920
Other liabilities	18,162	21,773
Total financial liabilities at amortised cost	9,652,872	11,474,055
Carrying amount of financial liabilities	9,652,872	11,474,055

Note 26: Administered financial instruments (continued)

	2012 $'000	2011 $'000
Note 26B: Net income and expense from financial assets
Loans and receivables
Guarantee Scheme for Large Deposits and Wholesale Funding fee	847,780	1,106,067
Guarantee of State and Territory Borrowing	63,373	100,129
Interest revenue	973	127
Net gain/(loss) loans and receivables	912,126	1,206,323
Available for sale financial assets
Interest revenue	3,066	3,840
Exchange gains/(loss)	1,071	(541,679)
Net gain/(loss) available for sale	4,137	(537,839)
Net gain/(loss) from financial assets	916,263	668,484
Note 26C: Net income and expense from financial liabilities
Financial liabilities — at amortised cost
IMF Charges	11,289	(18,734)
Exchange gains/(loss)	12,730	879,898
Net gain/(loss) financial liabilities — at amortised cost	24,019	861,164
Net gain/(loss) from financial liabilities	24,019	861,164

Note 26: Administered financial instruments (continued)

Note 26D: Fair value of financial instruments
The net fair values of Treasury’s administered financial instruments are equal to the carrying amount.
Fair value measurements categorised by fair value hierarchy
The following table provides an analysis of financial instruments that are measured at fair value, by valuation method. The different levels are defined below:
Level 1 — quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 — inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly; and
Level 3 — inputs for the asset or liability that are not based on observable market data (unobservable inputs).
Fair value hierarchy for financial assets
	2012 $'000	Level 1 2011 $'000	2012 $'000	Level 2 2011 $'000	2012 $'000	Level 3 2011 $'000	2012 $'000	Total 2011 $'000
Loans and receivables
IMF related monies owing	-	-	277	950	-	-	277	950
Guarantee Scheme for Large Deposits and Wholesale Funding contractual fee receivable	-	-	-	-	1,064,144	1,825,935	1,064,144	1,825,935
Guarantee Scheme for Large Deposits and Wholesale Funding fee receivable	-	-	60,882	78,824	-	-	60,882	78,824
Guarantee of State and Territory Borrowing contractual fee receivable	-	-	-	-	265,960	301,920	265,960	301,920
Guarantee of State and Territory Borrowing fee receivable			4,738	5,998			4,738	5,998
IMF maintenance of value	-	-	-	342,113	-	-	-	342,113
IMF new arrangements to borrow loan	-	-	661,133	224,547	-	-	661,133	224,547
Loans to States and Territories	-	-	15,101	-	-	-	15,101	-
HLIC premiums receivable	-	-	-	40	-	-	-	40
Dividend receivables	-	-	900,000	-	-	-	900,000	-
NDRRA receivables	-	-	-	128,643	-	-	-	128,643
Other receivables	-	-	17,577	13,860	-	-	17,577	13,860
Total	-	-	1,659,708	794,975	1,330,104	2,127,855	2,989,812	2,922,830

Note 26: Administered financial instruments (continued)
Note 26D: Fair value of financial instruments (continued)

Available for sale
International financial institutions	-	-	649,581	565,581	-	-	649,581	565,581
Australian Government entities	-	-	6,718,394	6,004,846	-	-	6,718,394	6,004,846
IMF Quota	-	-	4,797,510	4,813,206	-	-	4,797,510	4,813,206
Total	-	-	12,165,485	11,383,633	-	-	12,165,485	11,383,633
Amortised cost
Promissory notes	-	-	3,259,907	3,851,036	-	-	3,259,907	3,851,036
Grant liabilities	-	-	473,356	884,081	-	-	473,356	884,081
IMF SDR allocation liability	-	-	4,570,369	4,585,323	-	-	4,570,369	4,585,323
Other payables	-	-	974	4,025	-	-	974	4,025
Other liabilities	-	-	-	-	18,162	21,773	18,162	21,773
Guarantee Scheme for Large Deposits and Wholesale funding contractual guarantee service obligation	-	-	-	-	1,064,144	1,825,935	1,064,144	1,825,935
Guarantee of State and Territory Borrowing contractual guarantee service obligation					265,960	301,920	265,960	301,920
Total	-	-	8,304,606	9,324,465	1,348,266	2,149,628	9,652,872	11,474,093

Note 26: Administered financial instruments (continued)

Fair value measurements categorised by fair value hierarchy
	Loans and receivables
	2012 $'000	2011 $'000
Financial assets at fair value — Level 3
Opening balance	2,127,855	3,322,908
Settlement	(797,751)	(1,195,053)
Closing balance	1,330,104	2,127,855
	Available for sale financial assets
	2012 $'000	2011 $'000
Financial assets at fair value — level 3
Opening balance	6,570,427	17,213,607
Total gains or losses for the period recognised in profit or loss1	10,439	(883,077)
Total gains or losses recognised in other comprehensive income2	713,548	(4,993,614)
Purchases	73,561	46,717
Transfers out of Level 33	(7,367,975)	-
Closing balance	-	11,383,633
1. These gains and losses are presented in the schedule of administered comprehensive income under other gains, net foreign exchange gains exchange losses.
2. These gains and losses are presented in the Administered Reconciliation Schedule
3. Investments in International Financial Institutions are based on paid in capital, and in Australian Government entities are based on the Net asset position of the entity. Both are recorded at fair value using observable prices and should be recorded as Level 2 financial assets.
	At amortised cost
	2012 $'000	2011 $'000
Financial liabilities at fair value — Level 3
Opening balance	2,149,628	3,358,370
Total gains or losses recognised in other comprehensive income	-	3,085,498
Issues	(797,751)	(1,195,053)
Settlements	(3,611)	(3,099,187)
Closing balance	1,348,266	2,149,628

Note 26: Administered financial instruments (continued)
Note 26F: Credit risk

Note 26: Administered financial instruments (continued)
Note 26G: Liquidity risk

The Treasury’s administered financial liabilities are promissory notes grant liabilities the IMF SDR allocation and HIH and HLIC provisions. The contractual guarantee service obligation arising from the guarantee scheme for large deposits and wholesale funding and State and Territory borrowing are not included as there are no liquidity risks associated with these items. They are contingent on the value of the associated contractual fee receivable. The exposure to liquidity risk is based on the notion that the Treasury will encounter difficulty in meeting its obligations associated with administered financial liabilities. This is highly unlikely due to appropriation funding through special appropriations and non-lapsing capital appropriations as well as internal policies and procedures put in place to ensure there are appropriate resources for the Treasury to meet its financial obligations. The following tables illustrate the maturities for financial liabilities:
	On demand $'000	Within 1 year $'000	1 to 2 years $'000	2 to 5 years $'000	> 5 years $'000	Total $'000
Promissory notes	-	-	-	50,247	3,209,660	3,259,907
Grant liabilities	-	473,356	-	-	-	473,356
IMF SDR allocation liabilities	-	-	-	-	4,570,369	4,570,369
Other payables	974	-	-	-	-	974
Other liabilities	18,162	-	-	-	-	18,162
Total	19,136	473,356	-	50,247	7,780,029	8,322,768
	On demand $'000	Within 1 year $'000	1 to 2 years $'000	2 to 5 years $'000	> 5 years $'000	Total $'000
Promissory notes	-	-	-	-	3,851,036	3,851,036
Grant liabilities	-	884,081	-	-	-	884,081
IMF SDR allocation liabilities	-	-	-	-	4,585,323	4,585,323
Other payables	3,987	-	-	-	-	3,987
Other liabilities	21,773	-	-	-	-	21,773
Total	25,760	884,081	-	-	8,436,359	9,346,200

Note 26: Administered financial instruments (continued)
Note 26H: Market risk

Foreign currency risk refers to the risk that the fair value or future cash flows of a financial instrument will fluctuate due to changes in foreign exchange rates. The Treasury is exposed to foreign exchange currency risk primarily through undertaking certain transactions denominated in foreign currency. The Treasury is exposed to foreign currency denominated in USD, EUR and SDR. The following table details the effect on profit and equity as at 30 June 2012 from a 15 per cent (30 June 2011 from a 15 per cent) favourable/unfavourable change in AUD against the Treasury with all other variables held constant.
Sensitivity analysis of the risk that the entity is exposed to for 2012
		Effect on
Risk Variable	Change in risk variable %	Profit and loss 2012 $'000	Equity 2012 $'000
IFI Investments	15	(84,728)	(84,728)
IFI investments	(15)	114,632	114,632
IMF related moneys owing	15	(36)	(36)
IMF related moneys owing	(15)	49	49
IMF new arrangements to borrow loan	15	(86,235)	(86,235)
IMF new arrangements to borrow loan	(15)	116,670	116,670
Quota	15	(625,762)	(625,762)
Quota	(15)	846,619	846,619
Promissory notes	15	5,684	5,684
Promissory notes	(15)	(7,690)	(7,690)
IMF allocation liability	15	596,135	596,135
IMF allocation liability	(15)	(806,536)	(806,536)
Other liabilities	15	127	127
Other liabilities	(15)	(172)	(172)
Sensitivity analysis of the risk that the entity is exposed to for 2011
		Effect on
Risk Variable	Change in risk variable %	Profit and loss 2011 $'000	Equity 2011 $'000
IFI Investments	15	(73,772)	(73,772)
IFI investments	(15)	99,809	99,809
IMF related moneys owing	15	(124)	(124)
IMF related moneys owing	(15)	168	168
IMF new arrangements to borrow loan	15	(29,272)	(29,272)
IMF new arrangements to borrow loan	(15)	39,604	39,604
Quota	15	(627,810)	(627,810)
Quota	(15)	849,389	849,389
Promissory notes	15	5,394	5,394
Promissory notes	(15)	(7,297)	(7,297)
IMF allocation liability	15	598,086	598,086
IMF allocation liability	(15)	(809,175)	(809,175)
Other liabilities	15	519	519
Other liabilities	(15)	(703)	(703)

Note 27: Administered financial assets reconciliation

	Notes	2012 $'000	2011 $'000
Financial assets
Total financial assets per administered schedule of assets and liabilities		15,157,084	14,311,226
Less: non-financial instrument components GST receivable		(52)	-
Total non-financial instrument components		(52)	-
Total financial assets as per financial instruments note	26A	15,157,032	14,311,226

Note 28: Appropriations
Note 28A: Annual appropriations ('Recoverable GST exclusive')

	2012 Appropriations							Appropriation applied in 2012 (current and prior years) $'000	Variance $'000
	Appropriation Act			FMA Act			Total appropriation $'000
	Annual Appropriation $'000	Appropriations reduced(a) $'000	AFM(b) $'000	Section 30 $'000	Section 31 $'000	Section 32 $'000
DEPARTMENTAL
Ordinary annual services	161,230	(5,730)	-	-	11,317	1,115	167,932	(191,500)	(23,568)
Other services
Equity	583	-	-	-	-	-	583	(583)	-
Loans	-	-	-	-	-	-	-	-	-
Total departmental	161,813	(5,730)	-	-	11,317	1,115	168,515	(192,083)	(23,568)
ADMINISTERED
Ordinary annual services
Administered items	18,687	-	-	-	-	-	18,687	(12,741)	5, 946
Payments to CAC Act bodies	-	-	-	-	-	-	-		-
Other services
States, ACT, NT and Local government	-	-	-	-	-	-	-	-	-
New administered outcomes	-	-	-	-	-	-	-	-	-
Administered assets and liabilities	62,708	( 60,571)	-	-	-	-	2,137	(15,561)	(13,424)
Payments to CAC Act bodies	-	-	-	-	-	-	-	-	-
Total administered	81,395	( 60,571)	-	-	-	-	20,824	(28,302)	(7,478)

Notes:
(a) Appropriation Acts (Nos. 1, 3) 2011-12: sections 10, 11, 12 and 15. Appropriation Acts (Nos. 2, 4) 2011-12: sections 13 and 14. 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 that the Finance Minister reduce that appropriation. The reduction in the appropriation is effected by the Finance Minister's determination and is disallowable by Parliament. On 26 June 2012, the Finance Minister issued a determination to reduce departmental appropriation following a request by the Minister. The amount of the reduction under Appropriation Act (No.1) was $5,729,267.00.
As with departmental appropriations, the responsible Minister may decide that part or all of an administered appropriation is not required and request that the Finance Minister reduce that appropriation. For administered appropriations reduced under section 11 of Appropriation Acts (Nos, 1, 3) 2011-12 and section 12 of Appropriation Acts (Nos. 2, 4) 2011-12, the appropriation is taken to be reduced to the required amount specified in Note 28G once the annual report is tabled in Parliament. All administered appropriations may be adjusted by a Finance Minister’s determination, which is disallowable by Parliament. On 26 June 2012, the Finance Minister issued a determination to reduce administered appropriations following a request by the Minister. The amount of the reduction under the Appropriation Acts (nos. 2, 4) was $60,571,841.29.
(b) Advance to the Finance Minister (AFM) — Appropriation Acts (No. 1, 3) 2011-12: section 13 and Appropriation Acts (No. 2, 4) 201: section 15.
Note: the variance associated with the Departmental ordinary annual services was the result of voluntary redundancies paid during 2011-12 and higher than expected capital purchases.

Note 28: Appropriations (continued)

	2011 Appropriations							Appropriation applied in 2011 (current and prior years) $'000	Variance $'000
	Appropriation Act			FMA Act			Total appropriation $'000
	Annual Appropriation $'000	Appropriations reduced(a) $'000	AFM(b) $'000	Section 30 $'000	Section 31 $'000	Section 32 $'000
DEPARTMENTAL
Ordinary annual services	169,592	(926)			8,370	(938)	176,098	(173,426)	2,672
Other services
Equity	1,395				n/a		1,395	(1,395)	-
Total departmental	170,987	(926)	-	-	8,370	(938)	177,493	(174,821)	2,672
ADMINISTERED
Ordinary annual services
Administered items	47, 778	(31, 862)			n/a		15,916	(14,880)	1, 036
Other services
States, ACT, NT and Local government				-	n/a	-	-		-
New administered outcomes	-	-	-	-	n/a	-	-	-	-
Administered assets and liabilities	162, 265	-	-	-	n/a	-	162,265	(4,079)	158,186
Total administered	210, 043	(31, 862)	-	-	-	-	178,181	(18,959)	159,222

Notes:
(a) Appropriations reduced under Appropriation Acts (Nos. 1,3) 2010-11: sections 10, 11 and 12 and under Appropriation Acts (Nos. 2,4) 2010-11: sections 12, 13 and 14. 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. On 15 April 2011, the Finance Minister determined a reduction in departmental appropriations following a request by the Treasurer. The amount of reduction determined under Appropriation Act (No.3) 2010-11 was $926,000.
As with departmental appropriations, the responsible Minister may decide that part or all of an administered appropriation is not required and request that the Finance Minister reduce that appropriation. For administered appropriations reduced under section 11 of Appropriation Acts (Nos, 1, 3) 2010-11 and section 12 of Appropriation Acts (Nos. 2, 4) 2010-11, the appropriation is taken to be reduced to the required amount specified in Note 28G once the annual report is tabled in Parliament. All administered appropriations may be adjusted by a Finance Minister’s determination, which is disallowable by Parliament. On 15 April 2011, the Finance Minister issued a determination to reduce administered appropriations following a request by the Minister. The amount of the reduction under the Appropriation Acts (nos. 2, 4) was $31,862,246.43.
(b) Advance to the Finance Minister (AFM) — Appropriation Acts (No. 1, 3) 2010-11: section 13 and Appropriation Acts (No. 2, 4) 2010: section 15.

Note 28: Appropriations (continued)
Note 28B: Departmental and Administered Capital Budgets ('Recoverable GST exclusive')

	2011-12 Capital Budget Appropriations				Capital Budget Appropriations applied in 2011-12 (current and prior years)			Variance $'000
	Appropriation Act		FMA Act	Total Capital Budget Appropriations $'000	Payments for non-financial assets(c) $'000	Payments for other purposes $'000	Total payments $'000
	Annual Capital Budget $'000	Appropriations reduced(b) $'000	Section 32 $'000
DEPARTMENTAL
Ordinary annual services
Capital Budget(a)	6,485	-	-	6,485	6,724	-	6,724	(239)
ADMINISTERED
Ordinary annual services
Capital Budget(a)	-	-	-	-	-	-	-	-

Notes:
(a) 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 appropriation, please see Table A: Annual appropriations
(b) 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
(c) Payments made on non-financial assets include purchase 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.

Note 28: Appropriations (continued)

	2010-11 Capital Budget Appropriations				Capital Budget Appropriations applied in 2010-11 (current and prior years)			Variance $'000
	Appropriation Act		FMA Act	Total Capital Budget Appropriations $'000	Payments for non-financial assets(c) $'000	Payments for other purposes $'000	Total payments $'000
	Annual Capital Budget $'000	Appropriations reduced(b) $'000	Section 32 $'000
DEPARTMENTAL
Ordinary annual services
Capital Budget(a)	6,462	-	-	6,462	6,223	-	6,223	239
ADMINISTERED
Ordinary annual services
Capital Budget(a)	-	-	-	-	-	-	-	-

Notes:

(a) Departmental and Administered Capital Budgets are appropriated through Appropriation Acts (No.1,3,5). They form part of ordinary annual services and are no separately identified in the Appropriation Acts. For more information on ordinary annual services appropriation, please see Table A: Annual appropriations
(b) 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
(c) Payments made on non-financial assets include purchase 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.

Note 28: Appropriations (continued)
Note 28C: Unspent annual appropriations (‘Recoverable GST exclusive’)

Authority	2012 $'000	2011 $'000
Cash held	1,108	836
Appropriation Act (No. 1) 2008-09	578	578
Appropriation Act (No. 1) 2009-10	-	-
Appropriation Act (No. 1) 2010-11	-	71,586
Appropriation Act (No. 1) 2011-12	42,954	-
Appropriation Act (No. 3) 2011-12	4,158	-
Total unspent departmental annual appropriations	50,810	75,011
Authority	2012 $'000	2011 $'000
Appropriation Act (No. 2) 2004-05	-	668
Appropriation Act (No. 2) 2006-07	-	62
Appropriation Act (No. 2) 2007-08	-	27,674
Appropriation Act (No. 4) 2006-07	-	14,068
Appropriation Act (No. 4) 2008-09	-	3,996
Appropriation Act (No. 2) 2008-09	-	14,103
Appropriation Act (No. 2) 2009-10	18,508	18,508
Appropriation Act (No. 2) 2010-11	143,336	158,186
Appropriation Act (No. 1) 2010-11	-	7,005
Appropriation Act (No. 3) 2010-11	-	16,493
Appropriation Act (No. 2) 2011-12	61,997	-
Appropriation Act (No. 3) 2011-12	3,281	-
Total unspent administered annual appropriations	227,122	260,763

Note 28:Appropriations (continued)
Note 28D: Special appropriations ('Recoverable GST exclusive')

The following table lists current special appropriations contained in legislation that the Treasury is responsible for administering. In 2010-11, the Treasury expanded the list to include special appropriations contained in legislation that are inactive but still current as at 30 June 2011 The Treasury process to complete the 2010-11 financial statements identified 8 payments (2010: 6 payments) made from the COAG Reform Fund special account that resulted in technical breaches of Section 83 of the Constitution (refer to Note 26 for more information). After reviewing the circumstances of Section 83 breaches in relation to the COAG Reform Fund special account, the Treasury considers that there is a risk of non-compliance with Section 83 of the Constitution where payments are made from special appropriations and special accounts in circumstances where the payments do not accord with conditions included in the relevant legislation. The Treasury will investigate these circumstances and any impact on its special appropriations and special accounts shown below, seeking legal advice as appropriate.
Authority	Type	Purpose	Appropriation applied
			2012 $'000	2011 $'000
Asian Development Bank (Additional Subscription) Act 2009 (Administered)	Limited	To provide an appropriation for subscription Act 2009 payments to the ADB. The balance available (Administered) is USD$4,742,173,913.5 in callable shares and USD$181,781,020.18 in paid-in shares.	(14,812)	(18,687)
Federal Financial Relations Act 2009 (Administered)	Unlimited Amount	To provide an appropriation for payments of financial assistance to the States, the ACT and the NT.	(65,685,936)	(63,441,516)
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide an appropriation for redemption of securities by the IMF.	(291,567)	(315,051)
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide appropriation for Australia's obligations as a participant in the IMF's New Arrangements to Borrow.	(444,619)	(225,137)
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide an appropriation for the payment of charges on Special Drawing Rights issued to Australia by the IMF.	(14,274)	(16,965)
International Monetary Agreements Act 1947 (Administered)	Limited Amount	To provide an appropriation for Australia's purchase of additional shares in the International Bank for Reconstruction and Development. Balance available is USD$859,886,280.	(12,171)	-

Note 28:Appropriations (continued)
Note 28D: Special appropriations ('Recoverable GST exclusive')

Authority	Type	Purpose	Appropriation applied
			2012 $'000	2011 $'000
Commonwealth Places (Mirror Taxes) Act 1998	Unlimited Amount	To provide an appropriation for the purpose of paying compensation to the States in respect of constitutionally invalid States levied on Commonwealth Places	(466,870)	(424,285)
Superannuation Industry (Supervision) Act 1993 (Administered)	Unlimited Amount	To provide an appropriation for financial assistance to superannuation funds that have suffered an eligible loss as a result of fraudulent conduct or theft.	-	(54,994)
Car Dealership Financing Guarantee Appropriation Act 2009 (Administered)	Unlimited Amount	To provide an appropriation for claims under Act 2009 the Deed of Guarantee in respect of the (Administered) Australian Government guarantee to support interim funding to car dealerships.	-	(4,922)
Clean Energy Act 2011	Unlimited Amount	Provides a mechanism to deal with climate change by encouraging the use of clean energy.	-	-
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide an appropriation for Special Drawing Rights sold by the RBA to the Commonwealth.	-	-
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide an appropriation for Australia's obligations as a participant in the IMF's Special Drawing Rights Department.	-	-
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide an appropriation for Australia's support of the IMF's programs.	-	-
International Monetary Agreements Act 1947 (Administered)	Unlimited Amount	To provide an appropriation for Australia's support of the World Bank and Asian Development Banks Programs.	-	-
A New Tax System (Commonwealth — State Financial Arrangements Act 1999 (Administered)	Unlimited Amount	To provide an appropriation for payments to States if a State was under paid (Administered) GST revenue in the 2008-09 financial year.	-	-

Note 28:Appropriations (continued)
Note 28D: Special appropriations ('Recoverable GST exclusive')

Authority	Type	Purpose	Appropriation applied
			2012 $'000	2011 $'000
Asian Development Bank Act 1996 (Administered)	Limited Amount	To provide an appropriation for payments to establish the Bank. Balance available is USD$42,500,000 in callable shares.	-	-
Asian Development Bank Act (Additional Subscription) Act 1972 (Administered)	Limited Amount	To provide an appropriation for the additional subscription to the ADB. Balance available USD$102,000,000 in callable shares.	-	-
Asian Development Bank Act (Additional Subscription) Act 1977 (Administered)	Limited Amount	To provide an appropriation for the additional subscription to the ADB. Balance available USD$258,180,000 in callable shares.	-	-
Asian Development Bank Act (Additional Subscription) Act 1983 (Administered)	Limited Amount	To provide an appropriation for the additional subscription to the ADB. Balance available USD$498,110,000 in callable shares.	-	-
Asian Development Bank Act (Additional Subscription) Act 1995 (Administered)	Limited Amount	To provide an appropriation for the additional subscription to the ADB. Balance available USD$1,210,246,511 in callable shares.	-	-
European Bank for Reconstruction and Development Act 1990 (Administered)	Limited Amount	To provide an appropriation for payments to establish the Bank. Balance available is USD$81,690,700 in callable shares.	-	-
Financial Agreements (Commonwealth Liability) Act 1932 (Administered)	Unlimited Amount	To provide an appropriation for payment of principal and interest on bonds issued under the Financial Agreement Validation Act 1929, consolidating State debts.	-	-
Financial Services Reform Act 2001 (Administered)	Unlimited Amount	To provide an appropriation for payment of compensation in respect to levys payable by participants in particular financial markets.	-	-
Financial Services Reform Act 2001 (Administered)	Unlimited Amount	To provide an appropriation for payment of compensation in respect of a loss that is connected with a financial market.	-	-
Guarantee Scheme for Large Deposits and Wholesale Funding Appropriation Act 2008 (Administered)	Unlimited Amount	To provide an appropriation for payment of claims under the Deed of Guarantee in accordance with the Guarantee Scheme for Large Deposits and Wholesale Funding	-	-

Note 28:Appropriations (continued)
Note 28D: Special appropriations ('Recoverable GST exclusive')

Authority	Type	Purpose	Appropriation applied
			2012 $'000	2011 $'000
Guarantee of State and Territory Borrowing Appropriation Act 2008 (Administered)	Unlimited Amount	To provide an appropriation for payment of claims under the Deed of Guarantee in accordance with the Guarantee of State and Territory Borrowing.	-	-
Housing Loans Insurance Corporation (Transfer of Assets and Abolition) Act 1996 (Administered)	Unlimited Amount	To provide an appropriation for payments of claims made before the transfer period leading to the abolition of the HLIC.	-	-
International Bank for Reconstruction and Development (Share Increase) Act 1988 (Administered)	Limited Amount	To provide an appropriation for the purchase of additional shares in the IBRD.	-	-
International Bank for Reconstruction and Development (General Capital Increase) Act 1989 (Administered)	Limited Amount	To provide an appropriation for the purchase of additional shares in the IBRD.	-	-
International Finance Corporation Act 1955 (Administered)	Limited Amount	To provide an appropriation for the subscription to the capital stock of the IFC.	-	-
International Finance Institutions (Share Increase) Act 1982 (Administered)	Limited Amount	To provide an appropriation for the purchase of additional shares in the IFC and the IBRD. Balance available is USD$692,927,440 in callable shares.	-	-
International Finance Institutions (Share Increase) Act 1986 (Administered)	Limited Amount	To provide an appropriation for the purchase of additional shares in The IFC and the IBRD.	-	-
International Monetary Agreements Act 1959 (Administered)	Limited Amount	To provide an appropriation for the increase in Australia's quota in the IMF and increase in Australia's capital stock in the IBRD.
International Monetary Agreements Act 1960 (Administered)	Limited Amount	To provide an appropriation for the increase in Australia's quota in the IMF and increase in Australia's capital stock in the IBRD.	-	-
International Monetary Agreements Act 1965 (Administered)	Limited Amount	To provide an appropriation for the increase in Australia's quota in the IMF.	-	-

Note 28:Appropriations (continued)
Note 28D: Special appropriations ('Recoverable GST exclusive')

Authority	Type	Purpose	Appropriation applied
			2012 $'000	2011 $'000
International Monetary Agreements Act 1970 (Administered)	Limited Amount	To provide an appropriation for the increase in Australia's quota in the IMF.	-	-
International Monetary Agreements Act 1974 (Administered)	Limited Amount	To provide an appropriation for payments to the IBRD. Balance available is USD$37,368,120 in callable shares.	-	-
International Monetary Fund (Quota Increase) Act 1983 (Administered)	Limited Amount	To provide an appropriation for the increase in Australia's quota in the IMF.	-	-
International Monetary Fund (Quota Increase and Agreements Amendments) Act 1991 (Administered)	Unlimited Amount	To provide an appropriation for the increase in Australia's quota in the IMF.	-	-
Multilateral Investment Guarantee Agency Act 1997 (Administered)	Limited Amount	To provide an appropriation for payments to establish the Agency. Balance available is USD$14,827,728 in callable shares.	-	-
Papua New Guinea Loans Guarantee Act 1975 (Administered)	Limited Amount	To provide an appropriation for Australia's guarantee of certain public loans raised by Papua New Guinea. Balance available is AUD$3,530,000.	-	-
Papua New Guinea Loan (International Bank) Act 1970 (Administered)	Limited Amount	To provide an appropriation for Australia's guarantee of the loan to Papua New Guinea by the IBRD. Balance available is $1,365,000.	-	-
Papua New Guinea Loan (International Bank) Act 1970 (Administered)	Limited Amount	To provide an appropriation for Australia's guarantee of the loan to Papua New Guinea by the IBRD.	-	-
Payment of Tax Receipts (Victoria) Act 1996 (Administered)	Unlimited Amount	To provide an appropriation for payments to Victoria for certain taxes collected by the Australian Government of Victoria's behalf.	-	-
State Grants Act 1927 (Administered)	Unlimited Amount	To provide an appropriation for the distribution of surplus revenue to the States.	-	-

Note 28:Appropriations (continued)
Note 28D: Special appropriations ('Recoverable GST exclusive')

Authority	Type	Purpose	Appropriation applied
			2012 $'000	2011 $'000
States (Work and Housing) Assistance Act 1984 (Administered)	Unlimited Amount	To provide an appropriation for financial assistance to the States in connection with expenditure on Public Housing.	-	-
States (Work and Housing) Assistance Act 1988 (Administered)	Unlimited Amount	To provide an appropriation for financial assistance to the States in connection with expenditure on Public Housing.	-	-
Terrorism Insurance Act 2003 (Administered)	Unlimited Amount	To provide an appropriation for payments to the Australian Reinsurance Pool Corporation.	-	-
Terrorism Insurance Act 2003 (Administered)	Unlimited Amount	To provide an appropriation for payments of compensation in the acquisition of land.	-	-
Total			(66,930,249)	(64,501,557)

Note 28: Appropriations (continued)
Note 28E: Disclosure by agent in relation to annual and special appropriations ('Recoverable GST exclusive')

	Department of Education, Employment and Workplace Relations	Inspector General of Taxation
2012	National Partnership Payments and Assistance to States and Territories for Non-Government Schools $'000	Transaction service provider $'000
Total receipts	8,569,820	2,361
Total payments	8,569,820	2,344
	Department of Education, Employment and Workplace Relations	Inspector General of Taxation
2011	National Partnership Payments and Assistance to States and Territories for Non-Government Schools $'000	Transaction service provider $'000
Total receipts	9,653,561	2,192
Total payments	9,653,561	2,213

Note 28: Appropriations (continued)
Note 28F: Reduction in administered Items ('Recoverable GST exclusive')

2011-12	Amount required3 — by Appropriation Act			Total amount required3	Total amount appropriated4	Total reduction5
Ordinary Annual Services	Act (No.1)	Act (No.3)	Act (No. 5)
Outcome 1	13,800,581.04	-	-	13,800,581.04	18,687,000.00	4,886,418.96
2010-11	Amount required3 — by Appropriation Act			Total amount required3	Total amount appropriated4	Total reduction5
Ordinary Annual Services	Act (No.1)	Act (No.3)	Act (No. 5)
Outcome 1	15,915,753.57	-	-	15,915,753.57	47,778,000.00	31,862,246.43

Notes:
1. Numbers in this section of the table must be disclosed to the cent.
2. Administered items for 2011-12 were reduced to these amounts when these financial statements were tabled in Parliament as part of the department's 2011-12 annual report. This reduction is effective in 2012-13, but the amounts are reflected in Table A in the 2010-11 financial statements in the column 'Appropriations reduced' as they are adjustments to 2011-12 appropriations.
3. Amount required as per Appropriation Act (Act 1 s. 11; Act 2 s. 12).
4. Total amount appropriated in 2011-12.
5. Total reduction effective in 2012-13.

Note 29: Compliance with statutory conditions for payments from the Consolidated Revenue Fund

Note 29: Compliance with statutory conditions for payments from the Consolidated Revenue Fund (continued)

Appropriations	Payment amount 2011-12 $'000	Review complete?	Breaches identified				Potential breaches to date yet to be resolved		Remedial action taken or proposed
Special appropriations			Number	Total $'000	Incorrect $'000	Recovered /offset as at 30 June 2012	Yes/No	Indicative extent
International Monetary Agreements Act 1947 s7	291,567	Yes	-	-	-	-	N/A	N/A	N/A
International Monetary Agreements Act 1947 s8	14,274	Yes	-	-	-	-	N/A	N/A	N/A
International Monetary Agreements Act 1947 s8B	444,619	Yes	-	-	-	-	N/A	N/A	N/A
International Monetary Agreements Act 1947 s9	12,172	Yes	-	-	-	-	N/A	N/A	N/A
Asian Development Bank (Additional Subscription) Act 2009	14,812	Yes	-	-	-	-	N/A	N/A	N/A
Federal Financial Relations Act 2009	65,685,936	Yes	-	-	-	-	N/A	N/A	N/A
Special accounts
COAG Reform Fund Act 2008	21,474,820	Yes	-	-	-	-	Yes	3 groups of payments totalling $4,320	Awaiting legal advice

Note 29: Compliance with statutory conditions for payments from the Consolidated Revenue Fund (continued)

2011-12 payments pending legal advice
Portfolio	Payment Details	Amount ($)
Department of Agriculture, Fisheries and Forestry	Exotic Disease Preparedness — several payments	38,661
Department of Agriculture, Fisheries and Forestry	Plant Eradication — several payments	409,017
Department of Education, Employment and Workplace Relations	Literacy and Numeracy — several payments	3,872,445
Total		4,320,123
2010-11 payments without legal authority
Portfolio	Payment Details	Amount ($)
Department of Education, Employment and Workplace Relations	Better TAFE Facilities — 2 payments	9,225
Department of Health and Ageing	Health Services	136,000
Department of Infrastructure and Transport	Fort Street High School	3,000,000
Department of Sustainability, Environment, Water, Population and Communities	Water for the Future — 2 payments	2,142,800
Department of Education, Employment and Workplace Relations	Trade Training Centres — 2 payments	20,675,750
Total		25,963,775

Note 30: Special accounts and FMA Act Section 39
Note 30A: Special accounts ('Recoverable GST exclusive')

	Actuarial Services Special Account1		COAG Reform Fund Special Account2
	2012	2011	2012	2011
	$'000	$'000	$'000	$'000
Balance brought forward from previous period	2,149	2,223	-	-
Appropriation for reporting period	-	-	18,247,153	17,065,350
Other receipts from rendering of services	1,842	1,501	-	-
Receipts from other agencies	-	-	3,227,667	1,337,197
Total increase	3,991	3,724	21,474,820	18,402,547
Available for payments	3,991	3,724	-	-
Decreases:
Departmental
Payments made to employees	(1,316)	(1,202)	-	-
Payments made to suppliers	(393)	(373)	-	-
Total Departmental decreases	(1,709)	(1,575)	-	-
Administered
Payments made to suppliers	-	-	(21,474 820)	(18,402 547)
Repayments debited from the Special Account	-	-	-	-
Repayments debited from the Special Account (FMA Act section 39)	-	-	-	-
Total Administered decreases	-	-	(21,474 820)	(18,402 547)
Total decrease	(1,709)	(1,575)	(21,474,820)	(18,402,547)
Total balance carried to the next period	2,282	2,149	-	-

1 Legal authority: Financial Management and Accountability Act 1997; s20
Purpose: providing actuarial services and advice
Note: Actuarial Services Special Account was established on 1 October 2006.

 

2 Legal authority: COAG Reform Fund Act 2008
Appropriations: Financial Management and Accountability Act 1997; section 21
Purpose: For the making of grants of financial assistance to the States and Territories.
Note: The Treasury makes payments to the States and Territories from the COAG Reform Fund special account based on information provided by other Government departments that have policy and program implementation responsibility. Some payments have been found to have breached s83 of the Constitution. See note 29 for more details.

Note 30: Special accounts and FMA Act Section 39 (continued)

Financial System Stability Special Account (Administered)

The Treasury’s ‘Financial System Stability’ special account established under section 70E of the Banking Act 1959 for the making of payments authorised under specified sections of the Banking Act 1959, the Insurance Act 1973 and the Life Insurance Act 1975 and to meet expenses of administering the special account. For the years ended 30 June 2011 and 30 June 2012 this special account had nil balances and no transactions were credited or debited to the account.

Services for other Governments and non agency bodies account (Departmental)

The Treasury’s ‘Services for other Governments and non-agency bodies’ special account established under section 20 of the Financial Management and Accountability Act 1997 (FMA Act) was abolished on 12 October 2010. For the years ended 30 June 2011 and 30 June 2012 this special account had nil balances and no transactions were credited or debited to the account.

Other trust moneys account (Departmental — Special Public Money)

The Treasury has an ‘Other trust monies’ special account established under section 20 of the FMA Act. The purpose of this special account is for expenditure of monies temporarily held on trust or otherwise for the benefit of a person other than the Australian Government. Any money held is thus special public money under section 16 of the FMA Act. For the years ended 30 June 2011 and 30 June 2012 this special account had nil balances and no transactions were credited or debited to the account.

Other trust moneys account (Administered — Special Public Money)

The Treasury has an ‘Other trust monies’ special account established under section 20 of the FMA Act. The purpose of this special account is for expenditure of monies temporarily held on trust or otherwise for the benefit of a person other than the Australian Government. Any money held is thus special public money under section 16 of the FMA Act. This account was abolished on 26 June 2012.

For the year ended 30 June 2012 the balance of the account was zero. For the year ended 30 June 2011 this special account had nil balances and no transactions were credited or debited to the account.

Special Accounts investment of public money

For the periods 2010-11 and 2011-12, the Treasury has not used section 28 or 39 of the FMA Act in respect of all special accounts.

Services for Other Entities and Trust Money Special Account

On 26 June 2012 the Services for Other Entities and Trust Money Special Account was established under the section 20 of the FMA Act. The purpose of the account is to hold and expend amounts on behalf of persons or entities other than the Commonwealth. There were no transactions on the account during the 2011-12 financial year, the balance of the account is nil.

Note 31: Compensation and debt relief

	2012 $	2011 $
Departmental
No ‘Act of Grace’ expenses were incurred during the reporting period (2011: No expenses).	-	-
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: No waiver)	-	-
No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period. (2011: No payments)	-	-
No ex-gratia payments were provided for during the reporting period. (2011: No payments).	-	-
No payments were provided in special circumstances relating to APS employment pursuant to section 73 of the Public Service Act 1999 (PS Act) during the reporting period. (2011: No payments).	-	-
Administered
No ‘Act of Grace’ expenses were incurred during the reporting period (2011: No expenses).	-	-
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: No waivers)	-	-
No payments were provided under the Compensation for Detriment caused by Defective Administration (CDDA) Scheme during the reporting period. (2011: No payments)	-	-
No ex-gratia payments were provided for during the reporting period. (2011: No payments).	-	-
No payments were provided in special circumstances relating to APS employment pursuant to section 73 of the Public Service Act 1999 (PS Act) during the reporting period. (2011: No payments).	-	-

Note 32: Reporting of outcomes
Note 32A: Net cost of outcome delivery

	Outcome 1
	2012 $'000	2011 $'000
Departmental
Expenses	192,838	177,767
Own-source income	9,731	9,920
Administered
Expenses	86,868,463	86,961,136
Own-source income	5,252,242	3,306,709
Net cost/(contribution) of outcome delivery	81,799,328	83,822,274

Note 33: Net cash appropriation arrangements

	2012 $'000	2011 $'000
Total comprehensive income (loss) less depreciation/amortisation expenses previously funded through revenue appropriations and other comprehensive income1	(11,570)	2,436
Plus: depreciation/amortisation expenses previously funded through revenue appropriation	(13,418)	(12,015)
Plus: other comprehensive income/(loss)	(60)	-
Total comprehensive income (loss) — as per the Statement of Comprehensive Income	(25,048)	(9,579)

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.

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