GLOSSARY
AASB 1049
Australian Accounting Standard Board 1049 Whole of Government and General Government Sector Financial Reporting is the principal accounting standard applicable to the Commonwealth and State governments in the preparation of their financial reports. From 2008–09 onwards, Australian Accounting Standard Board 1049 has replaced Australian Accounting Standard 31 Financial Reporting by Government.
Accrual recording
A recording method in which revenues, expenses, lending and borrowing are recorded as they are earned, accrued or incurred regardless of when payment is made or received.
Advances paid (net)
Lending by public authorities with the aim of achieving government policy objectives less repayment of past lending.
Advances received (net)
Borrowing, net of repayments, from other public authorities.
Cash Flow Statement
The GFS financial statement that records cash flows from operating, investing and financing activities.
Capital grant expenses
Unrequited payments by government to finance the acquisition of non–financial capital assets by the recipient, or compensate the recipient for damage or destruction of capital assets, or increase the financial capital of the recipient.
Consolidation
The process of elimination of all within–sector asset–liability positions, and all transactions between two units of the same sectors. Consolidation can be applied to the statistics of any group of units of analytical interest.
Current grant expenses
Voluntary transfers intended to finance the current activities of the recipient. Includes grants for current purposes to private non–profit organisations serving households, grants made to foreign governments and organisations including grants made for aid projects, and current grants from one level of government to another (e.g. Commonwealth to State) and between units within the same level of government.
Deposits received (net)
Net increase in cash held by a government unit as a result of a net change to its liabilities generated by taking deposits from a private body or other government unit.
Depreciation
The accounting process of systematically allocating the cost less estimated residual value of an asset over its expected life.
Distributions paid
Cash transfers by public enterprises to their parent entities and other shareholders in the form of dividends, transfer of profits or other similar distributions.
Expenditure on non–financial assets (net)
Net expenditure on new and second–hand fixed assets, land and intangible assets excluding capitalised interest. Fixed assets are durable goods intended to be employed in the production process for longer than a year.
Finance leases
Leases and other arrangements which effectively transfer most of the risks and benefits associated with ownership of the leased property from the lessor to the lessee.
General government sector
Institutional sector comprising all government units and non–profit institutions controlled and mainly financed by government.
GFS net lending/borrowing (NLB)
The financing requirement of government, calculated as the GFS net operating balance less the net acquisition of non–financial assets. A positive result reflects a net lending position and a negative result reflects a net borrowing position.
GFS net operating balance (NOB)
GFS NOB is the difference between GFS revenues and GFS expenses. It reflects the sustainability of government operations.
Grants and subsidies received
Cash received from voluntary transfers by government and other entities.
Interest expense
Nominal interest on unfunded superannuation and other interest payable. Nominal interest on unfunded superannuation is the imputed interest accrued during the period on unfunded superannuation liabilities. See 'Superannuation expense' below.
Interest income
Income accrued by owners of financial assets such as deposits, securities other than shares, loans and accounts receivable in return for providing funds to other entities.
Jurisdiction
The public sector units over which the Commonwealth Government or an individual state or territory government has direct control or, in the case of local government authorities, the government which administers the legislation under which the authority was established.
Operating Statement
The operating statement presents details of transactions in GFS revenues, GFS expenses and the net acquisition of non–financial assets for an accounting period. GFS revenues are broadly defined as transactions that increase net worth and GFS expenses as transactions that decrease net worth. Net acquisition of non–financial assets equals gross fixed capital formation, less depreciation, plus changes in inventories plus other transactions in non–financial assets. Two key GFS analytical balances in the operating statement are GFS Net Operating Balance (NOB) and GFS Net Lending(+)/Borrowing(–).
Other financing transactions
Total financing less advances received (net), less borrowing (net), less deposits received (net) plus distributions paid. This is a residual calculation within cash flow statements and hence encompasses any errors and omissions in the components used to derive it.
Sales of goods and services
Revenue from the direct provision of goods and services by general government and public corporations.
Superannuation expense
Superannuation expense is a component of 'compensation of employees'. Superannuation expense in a period represents the increase in superannuation liabilities due to services provided by employees in that period.
Surplus(+)/Deficit(–)
Net cash flows from operating activities plus net cash flows from investments in non–financial assets, less distributions paid, less assets acquired under finance leases and similar arrangements.
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