Financial Performance – Departmental

The Department recorded a consolidated operating surplus in 2010-11 after elimination of unfunded depreciation

Operating Result – Departmental

The Department of Health and Ageing recorded a consolidated 2010-11 operating deficit of $16.553 million including unfunded depreciation. This is the first annual operating result under the Commonwealth new net cash appropriation framework. On elimination of unfunded depreciation the consolidated group recorded an operating surplus of $1.414 million.

Key components of the operating result after elimination of depreciation are:

a $0.027 million operating deficit for the core department;
a $0.937 million operating surplus for Therapeutic Goods Administration (TGA);
a $0.368 million operating surplus for the Office of the Gene Technology Regulator (OGTR); and
a $0.136 million operating surplus for National Industrial Chemicals Notification and Assessment Scheme (NICNAS).

The department has recorded a consolidated operating surplus in nine of the last ten years.

Revenue from Government increased by 2.57% for 2010-11

Revenue – Departmental

During 2010-11, revenue from Government increased by 2.57% ($15.012 million) to $600.183 million.

The Department’s 2010-11 departmental appropriation revenue has been adjusted primarily as a result of:

removal of depreciation funding under the net cash appropriation model (decrease of $15.212 million);
prior year departmental measure movements (decrease of $17.192 million); and
new departmental budget funding (increase of $56.524 million).

Sale of goods and rendering of services increased by 5.3% for 2010-11

During 2010-11, revenue from the sale of goods and rendering of services increased by 5.3% ($6.764 million) from $128.958 million primarily from:

an increase in the core department of $2.557 million (13.8%); and
an increase of $3.427 million (3.4%) in TGA.

Total departmental expenses increased by 7.0% for 2010-11

Expenses – Departmental

Operating expenses increased by 7.0% ($49.979 million) during 2010-11 to $762.356 million (2009-10: $712.377 million).

The major contributing factor was an increase in employee benefits ($36.923 million).

Departmental net assets increased by 85.2%

Assets and Liabilities – Departmental

Total assets have increased by $84.254 million to $461.864 million (2009-10: $377.610 million). The major contributors were:

· intangible assets increased by $17.531 million primarily due to the purchase and development of software holdings.

Total liabilities have decreased by $7.306 million to $262.884 million (2009-10: $270.190 million). The major contributors were:

The Department’s equity position has improved over the last ten years

Sustainability

A ten year summary of the Department’s assets, liabilities and equity position is provided in the graph below.

Assets, Liabilities & Net Equity Trend

The Department’s net equity increased by $91.560 million to $198.980 million (2009-10: $107.420 million). This increase is primarily attributable to additional budget funded capital of $99.959 million provided by Government. The budget funded capital was provided for Business Information System reform ($66.039 million), One Stop Shop ($20.000 million) and Home and Community Care ($12.000 million).

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