Education

Note 4: Explanations of material variances between
budget and actual outcomes
4.1
Statement of
Comprehensive
Income
Note
Budget
$’000
Actual
$’000
Variance
$’000
Variance
%
Appropriation revenue – recurrent 1 893,214 866,773 (26,441) (3)
Other revenue from government 2 16,465 5,553 (10,912) (66)
Grants 3 67,758 58,573 (9,185) (14)
Contributions received 4 80 12,740 12,660 (15,825)
Employee benefits 5 693,153 719,846 (26,693) (4)
Depreciation 6 41,184 52,279 (11,095) (27)
Supplies and consumables 5 237,974 188,822 49,152 21
Grants and subsidies 7 50,859 59,182 (8,323) (16)
Other expenses 1 50,899 25,275 25,624 50
Changes in physical asset revaluation reserve 8 26,368 64,642 38,274 145
Notes to Statement of Comprehensive Income variances
1. The variance is the result of the government’s decision to remove the requirement for inner budget agencies to be subject to payroll tax. Also, there was
an increased appropriation for VET Reform and asset sales offset by a reduction in Australian Government Specific Purpose Payments.
2. The variance is the result of the approved carry forward under section 8A(2) of the Public Account Act 1986 from 2011–12 financial year not being fully
expended, subsequently $7.674m was repaid to the Department of Treasury and Finance. In addition, at the time of the budget development the estimated
carry forward was $16.465m but actual approved carry forward was $13.227m.
3. The variance is the result of lower than budgeted revenue from the Australian Government for National Partnerships due to timing variances. These funds
will be received during the 2013–14 financial year.
4. This variance is the result of the recognition of $11.8m from the Tasmanian Risk Management Fund for the cost of providing a temporary school and the
rebuilding of the Dunalley Primary School which was destroyed by bushfires in January 2013.
5. The variance has been influenced by the delivery of Australian Government’s National Partnerships funding through the School Resource Package (SRP).
These funds had been originally budgeted to be expended as supplies and consumables; however, delivery of the funding through the SRP has resulted in
the expenditure being primarily employee entitlements. As a result, employee benefits were higher than budgeted but with a corresponding saving against
supplies and consumables. In addition, as per note 3 grants revenue was lower than budgeted therefore the corresponding expenditure against supplies
and consumables was lower than budgeted.
6. The variance is the result of the budget being developed on expected changes to the useful life of assets, asset reaching the end of their depreciable life,
asset sales, and demolition of former school sites. These did not occur to the level expected.
7. The variance is influenced by a number of factors including that at the time of the budget development for National Partnerships the distribution between
government and non-government sectors was unclear. The budget was therefore allocated for all National Partnership expenditure against supplies and
consumables. Therefore, a corresponding saving exists in that item. In addition, there were increased grant payments for contestable funding for vocational
education and training. This is the result of the Australian Government increasing the number of courses that have to be contested in the training market.
8. The variance is the result of the reassessment of the department’s valuation of specialised assets in the current year.
4.2
Statement
of Financial
Position
Note
Budget
$’000
Actual
$’000
Variance
$’000
Variance
%
Cash and deposits 1 44,981 53,570 8,589 19
Receivables 2 12,969 17,137 4,168 32
Intangibles 3 – 2,271 2,271 –
Other liabilities 4 14,620 4,846 (9,774) (67)
Reserves 5 302,030 385,387 83,357 28
Notes to Statement of Financial Position variances
1. The variance is influenced by schools retained funds at a higher level than budgeted. In addition, the budget estimate being based upon the department not
having an expectation of carry forward appropriation. However, an appropriation of $3.1m was carried forward as provided under section 8A(2) Public
Account Act 1986.
2. This variance is influenced by the recognition of funding of $6.6m that is receivable from the Tasmanian Risk Management Fund for the rebuilding of the
Dunalley Primary School which was destroyed by bushfires in January 2013.
3. The variance is the result of an intangible asset being recognised for the first time. At the time of the budget development it was not known if the asset
would be commissioned during 2012–13. It was previously incorporated in works in progress.
4. The variance is the result of the government’s decision to remove the requirement for inner budget agencies to be subject to payroll tax. Therefore, leave
liabilities no longer accrue a provision for payroll tax.
5. The variance is the result of the reassessment of the department’s valuation of specialised assets in the current year.
124 Financial Statements » Notes