3.4 Financial Management

The Department’s financial accountability responsibilities are set out in Section 44 of the Financial Management and Accountability Act 1997 and are based on the efficient, effective and ethical use of allocated resources. The Department met 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 required the Secretary to confirm the Department had complied with the financial management and accountability legislation and other specified Commonwealth policies. It also confirmed the Department operated within the agreed resources for the current financial year.

To ensure the Department complied with the certificate’s requirements in 2007–08, the Department maintained effective financial processes and internal control mechanisms as well as ongoing compliance monitoring and reporting activities.

Other key 2007–08 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;
• the management of the Government’s Administrative Arrangement Orders relevant to the Department and the Health and Ageing portfolio; and
• the Department’s program management improvements, comprising of: the ongoing implementation of common funding processes which are supported by an intranet-based program management manual and toolkit; and the provision of comprehensive program management staff training.

Asset Management

The Department’s asset management strategy emphasises whole-of-life asset management. In addition, the annual review seeks to minimise holdings of surpluses and underperforming assets.

The Department’s stocktake of fixed and intangible assets in 2007–08 confirmed their location and condition. The Department’s valuation and review of assets for impairment, undertaken in accordance with the Australian Accounting Standard (AASB 116 Property, Plant and Equipment and AASB 136 Impairment of Assets respectively), ensures assets are only carried at a value above their recoverable amount.

Discussion relating to the assets administered by the Department in 2007–08 can be found in Part 5: Financial Statements.

Purchasing

In 2007–08, with the exception of a small number of instances as reported in the Certificate of Compliance, the Department complied with the purchasing policies articulated in the Commonwealth Procurement Guidelines. Through the Department’s procurement framework, staff were encouraged to consider value for money, encourage competition, and use resources efficiently and ethically.

Australian National Audit Office Access Clauses

In 2007–08, 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 2007–08, three 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.