Part C - The main statements
15.8.
For publication purposes, the GFS framework is divided into a number of separate statements, each of which focuses on analytical aggregates or balances of particular user attention. These statements are the:
- Statement of operations;
- Statement of sources and uses of cash,
- Balance sheet;
- Statement of stocks and flows;
- Statement of total changes in net worth;
- Summary statement of explicit contingent liabilities and implicit contingent liabilities;
- Statement of stocks and flows of financial assets and liabilities by source;
- Gross public sector debt and other liabilities at market value by level of government subsector;
- Net public sector debt and other liabilities at market value by level of government subsector; and
- Debt instruments at market value by maturity.
15.9.
A brief description of the structure of these statements is provided below.
The statement of operations
15.10.
The statement of operations presents details of transactions in GFS revenues, GFS expenses and the net acquisition of non-financial assets. In a broad conceptual sense, GFS revenues are defined as transactions that increase net worth and GFS expenses as transactions that decrease net worth. Net acquisition of nonfinancial assets equals gross fixed capital formation, less depreciation, plus changes in inventories and other transactions in non-financial assets. An example outline of the statement of operations and the main relationships within it is provided in Table 15.1 below.
| Transactions affecting net worth: | $ |
|---|---|
| Revenue | |
| Taxation revenue Current grants and subsidies Sales of goods and services Interest income Dividend income (including tax equivalents) Other revenue Total | |
| Expenses | |
| Gross operating expenses Depreciation Employee expenses Other operating expenses Total Nominal superannuation interest expenses Other interest expenses Other property expenses Current transfers Grant expenses Subsidy expenses Other current transfers Capital transfers Grant expenses Other capital transfers Total | |
| Net Operating Balance | |
| Net acquisition of non-financial assets | |
| Gross fixed capital formation less Reductions in non-financial assets due to depreciation plus Change in inventories plus Other transactions in non-financial assets Total | |
| GFS Net Lending(+)/Borrowing(-) |
15.11.
Two important analytical balances are derived in the statement of operations. Transactions in revenues less transactions in expenses equals the Net Operating Balance. The subsequent deduction of transactions in the net acquisition of non-financial assets results in the GFS Net Lending (+) / Borrowing (–), which is also equal to the net result of transactions in financial assets and liabilities.
15.12.
The Net Operating Balance is a summary measure of the on-going sustainability of government operations. It is conceptually intended to be equivalent to the national accounting concept of Savings plus Capital Transfers, but in practice a reconciliation to the ASNA measure will be required to account for some differences in methodology and valuation used in the Australian GFS.
15.13.
GFS Net Lending (+) / Borrowing (–) is a summary measure which in essence indicates the extent to which government is either putting financial resources at the disposal of other sectors in the economy or utilising the financial resources generated by other sectors. It may therefore be viewed as an indicator of the financial impact of government activity on the rest of the economy. It is conceptually equivalent to the national accounting concept of Net Lending, but in practice GFS Net Lending (+) / Borrowing (–) will differ due to the different treatment and valuation of some component items.
The statement of sources and uses of cash
15.14.
The statement of sources and uses of cash identifies how cash is generated and applied in the GFS. Cash is classified as arising from operating, investing and financing activities of government. An example outline of the statement of sources and uses of cash is presented in Table 15.2 below.
| Cash flows from operating activities: | $ |
|---|---|
| Revenue cash flows Taxes received Grants and subsidies received Receipts from sales of goods and services Interest received Other receipts Total | |
| Expense cash flows Compensation of employees Purchases of goods and services Grants paid Subsidies paid Interest paid Other payments Total | |
| Net cash flows from operating activities | |
| Net cash flows from transactions in non-financial assets | |
| Sales of non-financial assets Purchases of new non-financial assets Purchases of second-hand non-financial assets Total | |
| Expenditure cash flows | |
| Net cash flows from transactions in financial assets for policy purposes Net cash flows from investments in financial assets for liquidity management purposes | |
| Net cash flows from financing activities | |
| Advances received (net) Borrowing (net) Deposits received Other financing (net) Total | |
| Net change in the stock of cash | |
| Cash surplus (+)/Cash deficit (-) | |
| Supplementary information Acquisition of non-financial assets under finance lease | |
| Cash surplus (+) / Cash deficit (-) (including the acquisition of non-financial assets under finance leases. |
15.15.
The statement of sources and uses of cash contains four derived items, including one key analytical balance. These are net cash inflows from operating activities; GFS Cash Surplus (+) / GFS Cash Deficit (-) (this is a key analytical balance); the net cash inflow from financing activities; and the net increase / decrease in cash held. A summary of the four derived items of the statement of sources and uses of cash can be found in Table 15.3 below.
| Balancing item | Formula |
|---|---|
| Net Cash Inflow from Operating Activities | Revenue cash flows minus Expense cash flows |
| GFS Cash Surplus (+) / GFS Cash Deficit (-) ****This is the key analytical balance**** | Revenue cash flows minus Expense cash flows plus Net cash outflow from investments in non-financial assets |
| Net Cash Inflow from Financing Activities | Net incurrence of liabilities minus Net acquisition of financial assets in cash |
| Net Change in the Stock of Cash | GFS Cash Surplus(+) / GFS Cash Deficit(-) add Net Cash Inflow from Financing Activities |
The balance sheet
15.16.
The balance sheet shows assets, liabilities and GFS Net Worth. An example outline of the balance sheet is presented in Table 15.4 below.
| Assets | $ |
|---|---|
| Non-financial assets | |
| Non-financial produced assets Inventories Valuables Other produced assets Land Mineral and energy resources Other non-produced assets Total | |
| Financial assets | |
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Other financial assets Total | |
| Total | |
| Liabilities | |
| Currency and deposits Advances Other loans and placements Debt securities Provisions for defined benefit superannuation Provisions for other employee entitlements Other liabilities Total | |
| Net worth (excluding shares and other contributed capital) | |
| Equity including contributed capital | |
| Net worth | |
| Memorandum items | |
| Implicit transfers Total arrears Interest on arrears Non-performing loan assets at market value |
15.17.
Assets represent instruments or entities over which ownership rights are enforced by institutional units and from which economic benefits may be derived by holding them, or using them, over a period of time. Assets are distinguished between non-financial and financial.
15.18.
Liabilities represent obligations to provide economic value to other institutional units. The classification of liabilities and financial assets needs to be symmetrical for consolidation purposes.
15.19.
GFS Net Worth is defined as assets less liabilities less shares and other contributed capital. For the general government sector, Net Worth is simply assets less liabilities since shares and other contributed capital are zero. For listed public corporations, shares and other contributed capital are recorded at current market values and for those which are unlisted, it is set equal to the value of assets less liabilities. The GFS Net Worth for unlisted public corporations is therefore zero.
The statement of stocks and flows
15.20.
The statement of stocks and flows shows the opening balances of assets and liabilities, the related flows during the reporting period and the closing balances. The preferred valuation basis for all stocks and flows is current market prices. An example outline of the statement of stocks and flows is provided in Table 15.5 below.
| Opening Stocks | Transactions | Revaluations | Other Volume Changes | Closing Stocks | |
|---|---|---|---|---|---|
| Assets | |||||
| Non–financial assets | |||||
| Non-financial produced assets Inventories Valuables Other produced assets Land Mineral and energy resources Other non-produced assets Total | |||||
| Financial assets | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Other financial assets Total | |||||
| Total | |||||
| Liabilities | |||||
| Currency and deposits Advances Other loans and placements Debt securities Provisions for defined benefit superannuation Provisions for other employee entitlements Other liabilities Total | |||||
| Net worth (excluding shares and other contributed capital) | |||||
| Equity including contributed capital | |||||
| GFS Net worth | |||||
| Net debt | |||||
| Net financial worth |
15.21.
The statement of stocks and flows records the opening stocks, transactions, revaluations and other volume changes, and closing stocks of each of the categories described above. Transactions in financial assets represent acquisitions of financial assets less liquidation of such assets (e.g. debtors’ repayment of the financial claims represented by the assets). Acquisition of financial assets includes making deposits of cash with financial institutions, making advances to other units of the public sector or to private sector entities, making investments in other units, and purchasing shares or making other forms of capital contribution to public and private sector corporations for policy or liquidity management purposes. Revaluations occur most often for financial assets, such as shares and securities, that are traded on financial markets or are subject to exchange rate fluctuations. Other volume changes that may have an effect on financial assets include the writing off of bad debts by a creditor. Only write-offs that are not made by mutual agreement between creditor and debtor are treated as other volume changes (those made with mutual agreement are treated as capital transfer expenses).
The statement of total changes in net worth
15.22.
The statement of total changes in net worth shows the net operating balance, the change in net worth due to other economic flows, total other economic flows and the total change in net worth. An example outline of the statement of total changes in net worth is provided in Table 15.6 below.
| Transactions affecting net worth: | $ |
|---|---|
| Revenue Expenses | |
| Net Operating Balance | |
| Change in net worth due to other economic flows: | |
| Financial assets | |
| Holding gains and losses Other change in the volume of financial assets | |
| Non-financial assets | |
| Holding gains and losses Other changes in the volume of non-financial assets | |
| Liabilities | |
| Holding gains and losses Other changes in the volume of liabilities | |
| Total other economic flows | |
| Total change in net worth |
15.23.
The statement of total changes in net worth combines the results of the statement of operations and the statement of stocks and flows in one statement. This statement serves to highlight the total changes in net worth of government, and explains the sources of changes in assets and liabilities from one reporting period to another in terms of transactions in revenue and expense and other economic flows.
The statement of contingent liabilities
15.24.
The statement of contingent liabilities records one-off guarantees, other explicit contingent liabilities not elsewhere classified, and implicit contingent liabilities. An example outline of The statement of contingent liabilities is provided in Table 15.7 below.
| One-off Guarantees | $ |
|---|---|
| Publicly guaranteed debt Other one-off guarantees Total | |
| Other explicit contingent liabilities not elsewhere classified | |
| Legal claims Indemnities Uncalled share capital Total | |
| Total explicit contingent liabilities | |
| Implicit contingent liabilities | |
| Present value of implicit obligations for future social security benefits Other implicit contingent liabilities not elsewhere classified |
15.25.
The statement of contingent liabilities records the explicit and some implicit contingent liabilities. Contingent liabilities are obligations that do not arise unless a particular, discrete event(s) occurs in the future. These contingencies create fiscal risks and may arise from deliberate public policy or from unforeseen events.
The statement of stocks and flows of financial assets and liabilities by source
15.26.
The statement of stocks and flows of financial assets and liabilities by source shows the opening balances of financial assets and liabilities, the related flows during the reporting period and the closing balances by source. The preferred valuation basis for all stocks and flows is current market prices. An example outline of the statement of stocks and flows of financial assets and liabilities by source is provided in Table 15.8 below.
| Opening Stocks | Transactions | Revaluations | Other Volume Changes | Closing Stocks | |
|---|---|---|---|---|---|
| Financial Assets | |||||
| Domestic Bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Other financial assets Total | |||||
| Non-bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Other financial assets Total | |||||
| Total | |||||
| Foreign Bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Other financial assets Total | |||||
| Non-bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Other financial assets Total | |||||
| Total | |||||
| Liabilities | |||||
| Domestic Bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Provisions for defined benefit superannuation Provisions for other employee entitlements Other liabilities Total | |||||
| Non-bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Provisions for defined benefit superannuation Provisions for other employee entitlements Other liabilities Total | |||||
| Total | |||||
| Foreign Bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Provisions for defined benefit superannuation Provisions for other employee entitlements Other liabilities Total | |||||
| Non-bank | |||||
| Currency and deposits Advances Other loans and placements Debt securities Equity including contributed capital Provisions for defined benefit superannuation Provisions for other employee entitlements Other liabilities Total | |||||
| Total |
15.27.
The statement of stocks and flows of financial assets and liabilities by source shows the opening balances, transactions, revaluations and other economic flows, and the closing balances of financial assets and liabilities by source. The source consists of a split between domestic bank or non-bank financial assets and liabilities; or foreign bank or non-bank financial assets and liabilities.
Gross public sector debt and other liabilities at market value by level of government subsector
15.28.
Gross public sector debt and other liabilities at market value by level of government subsector presents debt instruments on the gross basis at their current market value, and by level of government subsector. An example outline of gross public sector debt and other liabilities at market value by level of government subsector is provided in Table 15.9 below. Tables will be published for all Australia and for each jurisdiction.
| General government | Total general government sector¹ | Total public non-financial sector² | Total public sector³ | |
|---|---|---|---|---|
| Debt securities | ||||
| plus Loans | ||||
| Equals L1 | ||||
| plus SDRs | ||||
| plus Currency and deposits | ||||
| Equals L2 | ||||
| plus Other Accounts payable | ||||
| Equals L3 | ||||
| plus Insurance, superannuation and standardised guarantee schemes | ||||
| Equals L4 | ||||
| plus Financial derivatives | ||||
| Equals L5 | ||||
| plus Equities | ||||
| Equals L6 |
Note: The columns in this table are cumulative from left to right and the rows are cumulative from top to bottom
- Includes all general government units within the jurisdiction (including local government units, where applicable)
- Includes 1 above and all PNFC units within the jurisdiction (including local government PNFC units, where applicable)
- Includes 2 above and all PFC units within the jurisdiction (including local government PFC units, where applicable)
15.29.
Gross public sector debt and other liabilities at market value by level of government subsector shows debt and equity instrument coverage on the gross basis at the current market value as L1 to L6, and is further identified by level of government institutional coverage. Further information on debt instruments and the presentation of debt data in ABS GFS may be found in Chapter 8 of this manual.
Net public sector debt and other liabilities at market value by level of government subsector
15.30.
Net public sector debt and other liabilities at market value by level of government subsector presents debt instruments on the net basis at their current market value, and by level of government subsector. An example outline of net public sector debt and other liabilities at market value by level of government subsector is provided in Table 15.10 below.
| General government | Total general government sector¹ | Total public non-financial sector² | Total public sector³ | |
|---|---|---|---|---|
| Debt securities | ||||
| plus Loans | ||||
| Equals L1 | ||||
| plus SDRs | ||||
| plus Currency and deposits | ||||
| Equals L2 | ||||
| plus Other Accounts payable | ||||
| Equals L3 | ||||
| plus Insurance, superannuation and standardised guarantee schemes | ||||
| Equals L4 | ||||
| plus Financial derivatives | ||||
| Equals L5 | ||||
| plus Equities | ||||
| Equals L6 |
Note: The columns in this table are cumulative from left to right and the rows are cumulative from top to bottom
- Includes all general government units within the jurisdiction (including local government units, where applicable)
- Includes 1 above and all PNFC units within the jurisdiction (including local government PNFC units, where applicable)
- Includes 2 above and all PFC units within the jurisdiction (including local government PFC units, where applicable)
15.31.
Net public sector debt and other liabilities at market value by level of government subsector shows debt instrument coverage on the net basis at the current market value as L1 to L6, and is further identified by level of government institutional coverage. Further information on debt instruments and the presentation of debt data in ABS GFS may be found in Chapter 8 of this manual.
Debt instruments at market value by maturity
15.32.
Debt instruments at market value by maturity presents debt instruments at their current market value and on the basis of remaining maturity. An example outline of debt instruments at market value by maturity is provided in Table 15.11 below. Further information on the presentation of debt instruments by maturity may be found in Appendix 2 of this manual.
| Debt Instrument | Short term debt by original maturity | Long term debt by original maturity | Short term debt by remaining maturity¹ | ||
|---|---|---|---|---|---|
| With payment due in one year or less | With payment due in more than one year = Long term by remaining maturity | Total | |||
| Debt securities | |||||
| Loans | |||||
| SDRs | |||||
| Currency and deposits | |||||
| Other accounts payable | |||||
| Insurance, superannuation and standardised guarantee schemes | |||||
| Financial derivatives | |||||
| Total | |||||
- Short term by remaining maturity is calculated as Short term by original maturity plus Long term by original maturity with payment due in one year or less.