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Survey Participant Information - Economic Activity Survey - Retail and Wholesale
 

ECONOMIC ACTIVITY SURVEY - RETAIL AND WHOLESALE INDUSTRIES


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Question number references on this page
In some items on this page, alternative question number references are provided. For example, Total income is referenced as Q7 or Q11. This is because the Help Page refers to two forms, one of which has more questions than the other in relation to certain concepts.


Employment
Income Items
Expense Items
Inventories
Capital Expenditure and Disposal of Assets
Checklist

EMPLOYMENT

How should I report employment?


Employment is a headcount of all persons who worked for the business as proprietors, partners, salaried directors or other employees in the last pay period in June 2013. It excludes casual or seasonal employees who are on the payroll, but did not work during this pay period. You should report for the last pay period in June 2013 even if this is not the last pay period in your financial reporting year.

Working proprietors and partners (Q3a)
If you are the owner-operator or partner of an unincorporated business, include yourself (and other partners) in Q3a (working proprietors and partners). Owners/directors of Pty Ltd companies should not be counted as working proprietors, but should be included in Q3b (Salaried directors). Non salaried directors are excluded and should not be counted in Employment.

Other employees (Q3c)
This is a headcount of all persons who worked for the business and were paid through the payroll in the last pay period in June 2013.

What about persons working for the business under contract?

  • Contractors and subcontractors who are other businesses, (i.e. have their own ABN and are paid on a fee for service or commission only basis), should not be counted in Employment.
  • If the business paid another business for contract staff, and those persons were on the payroll of the other business, they should not be counted in Employment.
  • Persons employed on a fixed-term contract, e.g. temporary staff , should be included in Other employees (Q3c) only if they were paid through the payroll in the last pay period of June 2013 and Pay As You Go (PAYG) tax was deducted for them.
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INCOME ITEMS

What are Sales of goods bought in and resold (Q4a)?
Breakdown of sales of goods bought in and resold by customer type (Q4b)
Product breakdown of the Sales of goods bought in and resold (Q16 or Q31)
What are Sales of goods produced (Q4c)?
What should be reported as income from services?
Where to report income from various sources/activities?


What are Sales of goods bought in and resold?

Sales of goods bought in and resold
(Q4a) are those goods which the business purchased ready-made, then resold without making changes to the goods. Wholesale and retail sales of goods should be reported here. Examples include:
  • distribution or retailing of imported goods manufactured overseas, (e.g. the sale in Australia of cars imported from a related overseas manufacturer);
  • sales of bulk grain;
  • bottle shop sales of alcohol.

Breakdown of sales of goods bought in and resold by customer type (Q4b)
If income from sales of goods bought in and resold has been reported in Q4a, an estimated percentage of that income, according to customer type, should be provided in Q4b:
  • (i) other businesses/organisations, (trade sales, agricultural sales, sales to ABN holders);
  • (ii) the general public through online sales only; and
  • (iii) any other sales to the general public, (e.g. retail store sales).

Note
The percentage breakdown by customer type applies only to goods bought in and resold (Q4a) and the percentages should sum to 100%.

Product breakdown of goods bought in and resold (Q16 or Q31)
If income from sales of goods bought in and resold has been reported in Q4a, a breakdown is required - see Q16 or Q31 - by type of product sold. A list of products is provided in the form, against which you are asked to report for each product the value of sales and cost of goods sold during the reporting period.

Please note
If any of the listed goods were not bought in and resold by your business in the financial period, please leave the corresponding values blank.

If your business sold finished goods other than those listed on the form, please report:
  • the total sales income and cost of goods sold for all non-listed goods, in 'Other goods bought in and resold'
  • for each of the 3 largest items making up 'Other goods bought in and resold ' specify the nature of the goods and amount of sales income received and Cost of goods sold.

Do not include in the product breakdown:
  • income received for goods sold solely on a commission basis, i.e. where your business did not buy in the products sold; (this should be reported in Income from services (Q5a));
  • sales of goods produced Q4c (i.e. goods processed before sale); or
  • income from services Q5


What are sales of goods produced?

Sales of goods produced (Q4c) occur when the business that sells a commodity is the same business which undertook production of the commodity, or had the commodity produced for it by a third party on a contract, sub-contract or commission basis. Examples of activity generating income from sales of goods produced include:
  • bakery operation that manufactures baked goods on the premises
  • combining chemicals to manufacture paint
  • using wood to manufacture furniture
  • selling flowers or other crops grown by the business
  • assembling parts.
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What should be reported as income from services?

Generally, payment received for the provision of any services, regardless of whether they are a primary or secondary activity of the business, should be reported as Income from services (Q5).

Where the business receives a commission or fee for the sale of goods on behalf of clients (i.e. where the business does not own the goods), such payments should be reported as Income from services (Q5a)

Where the business receives payment for manufacturing or assembly work performed on behalf of another business on a commission or fee basis only (i.e. where the business does not own the inputs to production or the goods produced), such payment should also be reported as Income from services under Commission income received on goods sold (Q5a). Sales of EPAY products (e.g. phonecards, gift cards, lotto tickets etc), wool broking and commercial art gallery operation are examples of what should be included in Q5a.

Income from activity incidental to production or sales, such as the following, should also be included in Income from services:
  • other commission/concession income (Q5b)
  • franchising fees (Q5c)
  • repairs and maintenance service (Q5d) (Please note that, if a business providing repairs and maintenance services invoices customers for parts and service separately, income from both parts and service should be included in Q5d)
  • delivery charges separately invoiced to customers (Q5e), Delivery charges (including shipping and handling) not separately invoiced or itemised to customers should be included in Sales of goods (Q4).

Examples of income from Other services (Q5f) include:
  • income from installation charges
  • membership or subscription fees
  • income from the sale of advertising 'space' in print or other media
  • consulting fees.


Rent, leasing and hiring income is conceptually a service income, but, where the form requires it to be reported as a separate item, the following point is important to note.
Distinction: "Wet" and "dry" hire
Some equipment, e.g. machinery, equipment or vehicles, may be hired either with or without operator/driver. This distinction, sometimes referred to as "wet" and "dry" hire, determines how this type of income should be reported.
  • Where the business derives income from hiring out equipment without operator ("dry" hire), that income should be reported as Rent, leasing and hiring income (Q6) or Other income (Q6) if Rent, Lease and hiring income doesn't appear on the form.
  • Where the business derives income from hiring out equipment with operator ("wet" hire), the income should be reported as Income from other services (Q5f).

Royalties income - UNLESS this is required as a separate item on the form (Q9), report this item in Other income (Q6). Royalties income includes payments received for the right to extract natural resources and payments received for the use of intellectual property owned by the business, e.g. patents and copyright.

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Where to report income from various sources/activities?

Although this list is not exhaustive, it does address some of the common reporting problems encountered by businesses.

Computer Software Sales: The treatment of income from computer software sales differs depending on the situation.
  • If the business sells non-customised software it has created, this income should be reported as Sales of goods produced (Q4c)
  • Where the business provides a customised software solution, income should be reported as Income from services (Q5f)
  • Onselling software created by another business is reported as Sales of goods bought in and resold (Q4a).

Discounts/Rebates received: Discount or rebates received by a business from its suppliers should not be reported as income, but should be deducted from the expense item to which the discount or rebate applied (e.g. Purchases (Q9 or Q17 ), Other operating expenses (Q12 or Q23) and Cost of goods sold (Q16 or Q31)).

Export sales (f.o.b): Where goods are produced or purchased in Australia for sale overseas, income from Sales of goods (Q4) should represent the free-on-board (f.o.b.) price of the goods, i.e. a price which may cover the cost of transporting goods to the Australian customs frontier (point of exit from Australia) only, and not the cost of transporting the goods outside Australia. (Note the exclusion of Export freight charges from the concept of Sales of goods)

Food and beverages:
  • Food and beverages sold in original packaging, for example bottled water or confectionery, are considered Sales of goods bought in and resold (Q4a)
  • If liquor and other beverages are sold for consumption on premises (i.e. bar, cafe or restaurant sales), then these sales should be reported as Income from services (Q5f). If they have been sold for consumption off premises (e.g. bottle shop sales), then these sales should be reported as Sales of goods bought in and resold (Q4a)
  • Food and beverages manufactured and sold to the consumer on the same premises (e.g. retail bakery) are considered Sales of goods produced (Q4c)
  • If the food sold by the business is transformed through preparation and/or table service, sales should be reported as Income from services (Q5f). This treatment covers restaurant food sales, takeaway meals in containers, and catering services.

Progress payments billed on long term contracts: Where a business has entered into a long term contract to supply goods or services, and recognises expenses and progress payments in its accounts, the progress payments should be reported as Sales of goods (Q4) or Income from services (Q5), depending on the nature of the contract.

Asset sales: The profit or loss from the sale of assets should be reported in Other Income (Q6 or Q10) as a positive or negative value.

Asset revaluation/impairment: should be reported under Other income (Q6 or Q10) as either a net gain or loss. Negative revaluations and impairments should not be reported as an expense. This follows the same principles that apply to other examples listed on the form, such as share trading or sales of assets.
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EXPENSE ITEMS

How should I report Labour costs?
How should I report Purchases?
How should I report expenditure on electricity, fuels and water?
How should I report payments to contractors and other businesses for services?
Where do I report my specific expense item?

How should I report Labour costs?

Payments made to an unrelated business for the supply of staff on a fee or contract basis, where the staff entitlements are paid by the business supplying the employees, should be recorded in Labour Costs question part (e) Payments to employment agencies for staff (Q8e or Q12e). Payment to another business for recruitment services (i.e. advertising vacancies, conducting interviews) on behalf of your business should also be included in Payments to employment agencies for staff (Q8e or Q12e). However, any costs incurred by your business in the conduct of its own recruitment processes (e.g. payment directly to newspapers for running job vacancy advertisements) should be reported in Other operating expenses (Q12 or Q23).

Labour costs
(Q8 or Q12) exclude payments to contractors or sub-contractors operating under their own ABN. Information on payments to contractors can be found under How should I report payments to contractors and other businesses for services?

Only include Employer contributions paid into superannuation in Q8a or Q12a. This does not include personal superannuation contributions for business owners not drawing a wage.

Payroll tax
(Q8d or Q12d) is levied by State/Territory governments on businesses with large payrolls (usually greater than $0.5 million for the year). It does not refer to income tax withholding for employees.

Wages and salaries including provisions for employee entitlements (Q8f or Q12f). Report gross (i.e. before tax) wages and salaries.
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How should I report Purchases?

If a commodity is purchased to be used or consumed in the production of goods or services, or for repairs and maintenance of equipment, its cost should be reported as Purchases of materials, components, containers, packaging materials, electricity, fuels and water (Q9b or Q17b).

If the same commodity is purchased simply to be on-sold in the same form (without transformation), its cost should be reported as Purchases of finished goods for resale (Q9a or Q17a). For example:
  • where a business buys packaging materials for its use, the cost of the packaging materials should be included in Purchases of materials, components, containers, packaging materials, electricity, fuels and water (Q9b or Q17b); but
  • where a business buys packaging materials for sale (without processing) to other business or to the public, the cost of the packaging materials should be included in Purchases of finished goods for resale (Q9a or Q17a).

In the context of selling finished goods, Purchases (expenses) are not the same as cost of goods sold. Purchases represent the amount actually expended by the business in the reporting period. Cost of goods sold, which represents the amount expended only on goods actually sold in the reporting period, should be reported in Part 7 or Part 9 - Goods bought in and resold. Cost of goods sold includes purchases of goods for resale (without transformation), import duties and other taxes (not recoverable by the business from the taxing authorities), transport, handling and other costs directly attributable to the acquisition of the good and change in inventories over the reference period.
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How should I report expenditure on electricity, fuels and water?

Reporting of expenditure on electricity, fuels and water depends on how the electricity, fuels and water are used by the business, as shown in the following examples.
  1. Petroleum and diesel fuel purchased for retail sale - report as Purchases of finished goods for resale (Q9a or Q17a).
  2. Petroleum and diesel fuel purchased for use in own vehicles and equipment - report as Purchases of materials, components, containers and packaging materials, electricity, fuels and water (Q9b or Q17b).
  3. Water rates paid - include in Purchases of materials, components, containers and packaging materials, electricity, fuels and water (Q9b or Q17b).
  4. Electricity bills for powering office, plant, etc - include in Purchases of materials, components, containers and packaging materials, electricity, fuels and water (Q9b or Q17b).
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How should I report payments to contractors and other businesses for services?

There is a specific question for Payments to contractors and other businesses for freight, cartage, delivery and transport services (Q10 or Q18). Otherwise, all payments to other businesses for non-transport-related services provided should be reported in Other operating expenses (Q12 or Q23).

The following examples show how some commonly incurred expenses should be reported.
  1. Payments made to owner-drivers to transport goods sold by your business to customers - include in Outward freight, cartage, delivery and transport expenses (Q10a or Q18a).
  2. Postage costs - include in Outward freight, cartage, delivery and transport expenses (Q10a or Q18a).
  3. Payment made to a courier for pick-up of goods and delivery to your office - include in Other freight, cartage, delivery and transport expenses (Q10b or Q18b).
  4. Payment of separately invoiced delivery charges to a supplier of goods - include in Other freight, cartage, delivery and transport expenses (Q10b or Q18b).
  5. Payment for rent for your business premises - include in Rent, leasing and hiring expenses (Q11a or 19a)
  6. Payment of commission to another business for selling goods owned by your business - report as Other operating expenses (Q12 or Q23).
  7. Payment to another business for training your employees - include in Other operating expenses (Q12 or Q23).
  8. Travel and accommodation expenses for your employees - include in Other operating expenses (Q12 or Q23).

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Where do I report my specific expense item?

Although this list is not exhaustive, it does address some of the common reporting problems encountered by businesses:

Consumables: Consumables such as stationery, staff amenity supplies, cleaning materials etc. should be reported as Purchases of materials, components, containers and packaging materials (Q9b or Q17b).

Discounts/Rebates given: Discounts or rebates given by your business to its customers should not be reported as an expense item, but should be netted off the income item to which the discount/rebate applied, e.g. Sales of goods (Q4) or Income from services (Q5).

Equipment hire: If the equipment was hired without operator (i.e. "dry hire"), the expenses should be reported as Other rent, leasing and hiring expenses (Q11c or Q19c). If the equipment was hired with operator ("wet hire"), the expenses should be included in Other operating expenses (Q12 or Q23).

Finance lease payments: When an asset, e.g. company car, is acquired under a finance lease arrangement, the value of the acquisition should be included in Capital expenditure including capitalised work done by own employees (Q32) in the year of acquisition if this appears on the form. Repayments under a finance lease agreement consist of two components: interest and capital repayments. Capital repayments should not be reported in this form. The interest component only should be included in Interest expenses (where it is separately itemised in Q14); otherwise in Other operating expenses (Q12).

Franchise fees: If the business is a franchisee paying fees to a franchisor, those fees should be included in Other operating expenses (Q12 or Q23)

Motor vehicle insurance premiums:
  • Optional third party insurance premiums, payable at the discretion of the business, should be included in Insurance premiums (where it is separately itemised in Q13); otherwise in Other operating expenses (Q12).
  • Compulsory third party insurance premiums, payable as part of the vehicle registration process should be included in Other operating expenses (Q12 or Q23).

Sponsorship Payments: Sponsorship is not considered the same as a donation, as it involves a transaction, usually advertising or promotional benefits for the individual or business making the payment. It should therefore be reported as Other operating expenses (Q12 or Q23), whereas donations are excluded altogether.
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INVENTORIES

How should I report inventories?


Inventories (Q15 or Q28) are divided into three sections; Raw materials, Work-in-progress and Finished goods.

Raw materials
(Q15a or Q28a) consist of goods that a business holds with the intention of using to produce other goods or in rendering services. For example, paper supplies for use in printing newspapers (good produced) or raw food to make a meal (provide a service).

Work-in-progress
(Q15b or Q28b) consists of goods that still require work to reach the condition they are to be sold in, such as partially assembled machinery. The value of work-in-progress inventories should be reported net of progress payments billed.

Finished goods
(Q15c or Q28c) consist of goods that are to be sold in their current condition, including goods for resale.

Inventories do not include depreciable assets of the business.
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CAPITAL EXPENDITURE AND DISPOSAL OF ASSETS

How should I report capital expenditure?
What is capitalised work done by own employees?

How should I report capital expenditure?

Capital expenditure refers to the amount spent by a business in the current reporting period on the acquisition of non-current assets. It does not represent the value of asset holdings purchased prior to the current reporting period and does not include additions to inventories. It is reported under Capital expenditure including capitalised work done by own employees (Q32).

If the business hires contractors to carry out capital work, then these contractor payments should be included in the cost of the capital works.

The following are examples of how some common types of acquisitions should be reported under Capital expenditure including capitalised work done by own employees (Q32). (The value reported should be the purchase price of the asset acquired.)

1. Cars, trucks and buses - in Road Vehicles (Q32a).
2. Aeroplanes, trains and ships - in Other transport vehicles and equipment: (Q32b).
3. Fork lifts, assembly line machines, presses and cranes - in Industrial machinery and equipment (Q32c).
4. Audio visual equipment, electric lighting or signs, transformers and generators - in Electronic equipment and electrical machinery (Q32f).
5. Tractors, photographic equipment, medical diagnostic equipment, fencing, breeding stock - in Other plant and equipment (Q32h).
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What is capitalised work done by own employees?

Capitalised work done by own employees occurs when a business uses its own employees to add to the value of its assets by virtue of project work. Examples include:
  • employees carry out work to build a structure, such as an outbuilding;
  • employees carry out work to develop an in-house software inventory control system.

In these cases, the cost of the project - both wages and salaries paid to employees and materials used for the capital work - may be capitalised, so that the cost can be amortised over more than one reporting period.

If the project work relates to a non-current asset, it is included in the relevant section of the question Capital expenditure including capitalised work done by own employees (Q32). Capitalised work done by own employees should also be reported as Capitalised wages and salaries (Q33a) and Purchases of materials for capital work (Q33b). That is to say that Capitalised work done by own employees (Q33) is a subset of Capital expenditure... (Q32)

Capitalised wages and salaries and purchases of materials must relate to capital works. If they are wages and salaries or purchases relating to the daily operations of the business, they are reported as an expense item.
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CHECKLIST

The purpose of this checklist is to assist you, if you wish, to check the information which you have supplied in the form before returning it to ABS. Use of the checklist may reduce the need for us to contact you with further enquiries. The points covered reflect some of the most common reporting errors.

Employment (Q3)
  • Are the reported numbers a headcount of persons working for the business? (Should not be FTE.)
  • Have you reported only those who worked for the business in the last pay period ending in June 2013? (i.e. Regardless of your reporting period; not including casual/seasonal employees who did not work during that pay period.)
  • Does Total number of persons (Q3d) equal the sum of Working proprietors and partners (Q3a), Salaried directors (Q3b) and Other employees (Q3c)?
  • Working proprietors and partners (Q3a) should only be reported for an unincorporated business, not if the business is incorporated (e.g. Pty Ltd).
  • If the business had offices/locations with staff in more than one state or territory, does the total for Australia (Q30) equal both the sum of components and Total number of persons in Q3d?

Financial information
  • Are all reported financial items reported in $'000s (thousands)? For example, if business income for the year were $123,456, it should be reported as 123.
  • Do total income (Q7 or Q11) and total expenses (Q13 or Q24) equal the sum of their components?
  • Have sales and purchases been reported net of GST?
  • Have the nature and amount of the main components of 'other...' items been provided in Q4c, Q5f, Q6 or Q10, Q9b(iii) or Q17(iii), Q11 or Q19, Q12 or Q23, Q16 or Q31, Q32h and Q33C
  • If income from sales of goods produced by the business has been reported, have purchases been reported correctly, i.e. as Purchases of materials, components, containers and packaging materials, electricity, fuels and water (Q9b or Q17b)?
  • If income from sales of goods not produced by the business has been reported, have purchases been reported correctly, i.e. as Purchases of finished goods for resale (Q9a or Q17a)?
  • Have the values of both opening and closing inventories (Q15 or Q28) been reported, where applicable?
  • If Capitalised work done by own employees is reported in Q33c, the value must be less than or equal to the sum of Capital expenditure items reported in Q32.

Other information
  • Have you provided an estimate of the time taken to complete this form? (Please note that we use the time taken information to help us to design effective survey forms while minimising the burden on our respondents.)
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