Annual Report - 3.4 Financial Management

Table of contents

Part 3: Management Arrangements

Part 4: Accountability Reporting

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The Department’s financial accountability responsibilities are set out in Section 44 of the Financial Management and Accountability Act 1997 and are based on efficient, effective and ethical use of allocated resources. The Department meets these responsibilities by working within a financial control framework that supports efficient processing and recording of financial transactions (including the production of audited financial statements).

In 2006–07, the Government introduced an annual financial reporting requirement known as the Certificate of Compliance. The certificate requires the Secretary to confirm the Department complied with the financial management and accountability legislation and other specified Government policies. It also confirms whether the Department is operating within the agreed resources for the current financial year.

To ensure the Department complied with the certificate’s requirements in 2008–09, the Department maintained effective financial processes and internal control mechanisms, as well as ongoing compliance monitoring and reporting activities.

Other key 2008–09 financial management initiatives included:

the continued focus on the Department’s internal business planning and budgeting processes to better align policy and program delivery with Government initiatives and priorities, and to manage Government budgeting and funding announcements;
establishing appropriate business processes to support the transition of National Specific Purpose Payments and National Partnerships Payments under the federal financial relations framework. Payments previously made by the Department directly to the states and territories are now paid through a single monthly payment from the Treasury; and
the Department’s improvements to its program management system, including the ongoing implementation of common funding processes which are supported by an intranet-based program management manual and toolkit.

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Asset Management

The Department’s asset management strategy emphasises whole-of-life asset management. The Department also undertakes an annual review that seeks to minimise holdings of surplus and underperforming assets. The Department’s stocktake of fixed and intangible assets in 2008–09 confirmed their location and condition.

In 2007–08, the Department conducted a valuation of assets in accordance with the Australian Accounting Standard (AASB 116 Property, Plant and Equipment). In 2008–09, the Department obtained independent expert advice on asset values and conducted a review of assets for impairment (AASB 136 Impairment of Assets), to ensure assets are only carried at a value above their recoverable amount.

Discussion relating to the assets administered by the Department in 2008–09 can be found in Part 5: Financial Statements.

Purchasing

In 2008–09, with the exception of those instances reported in the Certificate of Compliance, the Department complied with the Government’s purchasing policies as articulated in the Commonwealth Procurement Guidelines (available at www.finance.gov.au). The Department’s procurement framework encourages staff to consider value for money, encourage competition, and use resources efficiently and ethically.

Australian National Audit Office Access Clauses

All of the Department’s awarded Contracts or Deeds of Standing Offer valued at $100,000 (GST inclusive) or greater contained standard clauses granting the Auditor-General access to contractors’ premises.

Exempt Contracts

In 2008–09, 81 contracts were exempted from reporting on AusTender on the basis that publishing contract details would disclose exempt matters under the Freedom of Information Act 1982.
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