2001-02 Annual Report - Sydney Local Health District - NSW ...

South Western Sydney Area Health Service Annual Report 2001/2002NOTES TO AND FORMING PARART OF THE FINANCIAL STATEMENTS TEMENTS forSouth Western Sydney Area Health Servicefor the year ended 30 June 20021 The Health Service Reporting EntityThe Health Service, as a reporting entity, comprises all the operating activities of the Hospitalfacilities and the Community Health Centres under its control. It also encompasses the SpecialPurposes and Trust Funds that, while containing assets that are restricted for specified usesby the grantor or the donor, are nevertheless controlled by the Health Service.In the process of preparing the consolidated financial statements for the economic entityconsisting of the controlling and controlled entities, all inter-entity transactions and balanceshave been eliminated.The reporting entity is consolidated as part of the NSW Total State Sector and as part of the NSWPublic Accounts.2 Summary of Significant Accounting PoliciesThe Health Service’s Financial Statements are a general purpose financial report that have beenprepared on an accruals basis and in accordance with applicable Australian AccountingStandards, other authoritative pronouncements of the Australian Accounting Standards Board(AASB), Urgent Issues Group (UIG) Consensus Views and the requirements of the HealthServices Act 1997 and its regulations including observation of the Accounts and AuditDetermination for Area Health Services and Public Hospitals.Where there are inconsistencies between the above requirements, the legislative provisionshave prevailed.Statements of Accounting Concepts are used as guidance in the absence of applicableAccounting Standards, other mandatory professional requirements and legislative requirements.Except for certain investments, (land and buildings, plant and equipment and infrastructuresystems, that are recorded at valuation), the financial statements are prepared in accordancewith the historical cost convention. All amounts are rounded to the nearest one thousanddollars and are expressed in Australian currency.Other significant accounting policies used in the preparation of these financial statements are asfollows:a) NSW Health Department Recurrent PaymentsPayments are made by the NSW Health Department on the basis of the net allocation for theHealth Service as adjusted for approved supplementations mostly for salary agreements, patientflows between Health Services and other States and approved enhancement projects. Thisallocation is included in the Statement of Financial Performance before arriving at the “Resultfor the Year from Ordinary Activities” on the basis that the allocation is earned in return for thehealth services provided in 2001/2002 on behalf of the Department. Allocations are normallyrecognised upon the receipt of Cash.Expenses/revenues of Affiliated Health Organisations (Karitane, Carrington Centennial Hospital,Hope Healthcare (Braeside Hospital) and the Benevolent Society of NSW), have only beenincluded in the Statement of Financial Performance to the extent of the net cash paymentsmade to the Health Organisations concerned. The Health Service is not deemed to own orcontrol the various assets/liabilities of the aforementioned Health Organisations and suchamounts have been excluded from the Statement of Financial Position. Any exceptions arespecifically listed in the notes that follow.36