3.3 - 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 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 called 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 be confident that the Department was complying with the certificate’s requirements, the Department implemented and continues to maintain effective financial processes and internal control mechanisms as well as compliance monitoring and reporting activities.

Other key initiatives in 2006–07 included:

• the Department’s internal business planning and budgeting incorporated a divisional restructure to better align policy and program delivery with Government initiatives and priorities;
• information technology and business process improvements in the areas of non-ongoing staff processing and external committee management have seen a reduction in the manual administrative processes associated with these activities; and
• the Department’s program management improvements, comprising:
  • the continued adoption of common funding processes supported by an intranet-based program management manual and toolkit;
  • the provision of comprehensive program management staff training; and
  • the introduction of new information technology capabilities which reduce the manual data entry for capturing and using program management information.

Purchasing

In 2006–07, the Department complied with the Government’s purchasing policies as articulated in the Commonwealth Procurement Guidelines.

Asset Management

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

The Department’s stocktake of fixed and intangible assets in 2006–07 confirmed their location and condition. The Department’s review of assets for impairment, undertaken in accordance with the Australian Accounting Standard (AASB 136 Impairment of Assets), ensures the Department does not carry assets at a value above their recoverable amount.

Competitive Tendering and Contracting

In 2006–07, the Department continued its outsourced service arrangement for office services, and warehousing and distribution of publications and forms. The outsourced arrangements provided the Department with streamlined services, representing demonstrable benefits and cost efficiencies.

The Department conducted an open market testing exercise for warehousing and distribution services in 2006–07, which resulted in a new three year service contract commencing on 1 April 2007.

Exempt Contracts

In 2006–07, the Department exempted two contracts from publishing on AusTender. The basis for these exemptions was that publishing contract details would disclose exempt matters under the Freedom of Information Act 1982.

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