Department of Sustainability, Environment, Water, Population and Communities

	2013		2012
	$'000		$'000
BY TYPE
Commitments receivable
Water entitlements	(14,706)		(14,043)
Net GST recoverable on commitments	(51,796)		(73,532)
Total commitments receivable	(66,502)		(87,575)
Commitments payable
Capital commitments ^1
Other	655		6,469
Total capital commitments	655		6,469
Other commitments
Project commitments ^2	928,986		981,453
Other ^3	8,863		19,083
Total other commitments	937,849		1,000,536
Total commitments payable	938,504		1,007,005
Net commitments by type	872,002		919,430
BY MATURITY
Commitments receivable
Other commitments receivable
One year or less	(31,870)		(47,384)
From one to five years	(28,747)		(34,304)
Over five years	(5,885)		(5,887)
Total other commitments receivable	(66,502)		(87,575)
Total commitments receivable	(66,502)		(87,575)
Commitments payable
Capital commitments
One year or less	627		6,469
From one to five years	19		-
Over five years	9		-
Total capital commitments payable	655		6,469
Project commitments
One year or less	330,179		509,905
From one to five years	530,068		404,252
Over five years	68,739		67,296
Total project commitments payable	928,986		981,453
Other Commitments
One year or less	7,648		17,533
From one to five years	1,215		1,550
Total other commitments	8,863		19,083
Total commitments payable	938,504		1,007,005
Net commitments by maturity	872,002		919,430

NB: Commitments are GST inclusive where relevant.

Capital commitments relate to amounts payable in relation to the acquisition of water entitlements. Project commitments relate to grant amounts payable under agreement in respect of which the grantee has yet to complete the milestone required under the agreement. Other commitments relate to contracts for goods and services in respect of which the contracted party has yet to provide the goods and services required under the contract.

Table of Contents - Notes
Note 1: Summary of Significant Accounting Policies

Note 2: Events After the Reporting Period

Note 3: Expenses

Note 4: Income

Note 5: Financial Assets

Note 6: Non-Financial Assets

Note 7: Payables

Note 8: Interest Bearing Liabilities

Note 9: Provisions

Note 10: Restructuring

Note 11: Cash Flow Reconciliation

Note 12: Contingent Assets and Liabilities

Note 13: Related Party Disclosures

Note 14: Senior Executive Remuneration

Note 15: Remuneration of Auditors

Note 16: Financial Instruments

Note 17: Financial Assets Reconciliation

Note 18: Administered – Expenses

Note 19: Administered – Income

Note 20: Administered – Financial Assets

Note 21: Administered – Non-Financial Assets

Note 22: Administered – Payables

Note 23: Administered – Cash Flow Reconciliation

Note 24: Administered – Contingent Assets and Liabilities

Note 25: Administered – Investments

Note 26: Administered – Financial Instruments

Note 27: Administered Financial Assets Reconciliation

Note 28: Appropriations

Note 29: Special Accounts

Note 30: Compensation and Debt Relief

Note 31: Reporting of Outcomes

Note 32: Cost Recovery

Note 33: Net Cash Appropriation Arrangements

Summary of Significant Accounting Policies

1. 
   Objectives of the Department of Sustainability, Environment, Water, Population and Communities
   

The Department of Sustainability, Environment, Water, Population and Communities (DSEWPaC / the Department) is an Australian Government controlled entity. It is a not-for-profit entity. The objective of the Department is to provide leadership on environment, water, heritage and sustainability matters with a national focus, or matters that are the direct responsibility of the Australian Government. The Department is also responsible for advancing Australia’s interests in the Antarctic, and supporting the Government’s sustainable population strategy.

The Department is structured to meet the following outcomes:

Outcome 1:	The conservation and protection of Australia's terrestrial and marine biodiversity and ecosystems through supporting research, developing information, supporting natural resource management, and establishing and managing Commonwealth protected areas.
Outcome 2:	Improved sustainability of Australia's population, communities and environment through coordination and development of sustainable population and communities policies, and the reduction and regulation of waste, pollutants and hazardous substances.
Outcome 3:	Advancement of Australia's strategic, scientific, environmental and economic interests in the Antarctic by protecting, administering and researching the region.
Outcome 4:	Adaptation to climate change, wise water use, secure water supplies and improved health of rivers, waterways and freshwater ecosystems by supporting research, and reforming the management and use of water resources.
Outcome 5:	Increased protection, awareness and appreciation of Australia's environment and heritage through regulating matters of national environmental significance and the identification, conservation and celebration of natural, indigenous and historic places of national and World Heritage significance.
Outcome 6:	Protection and restoration of environmental assets through the management and use of Commonwealth environmental water.

The continued existence of the Department in its present form and with its present programs is dependent on Government policy and on continuing funding by Parliament for the Department’s administration and programs.

The Department’s activities contributing toward these outcomes are classified as either departmental or administered. Departmental activities involve the use of assets, liabilities, income and expenses controlled or incurred by the Department in its own right. Administered activities involve the management or oversight by the Department, on behalf of the Government, of items controlled or incurred by the Government.

The Department’s activities are identified under ten Programs. The relationship of Programs to Outcomes is as follows:

Outcome 1
Program 1.1:	Sustainable Management of Natural Resources and the Environment
Program 1.2:	Environmental Information and Research
Program 1.3:	Carbon Pollution Reduction – Land Sector Initiatives
Outcome 2
Program 2.1:	Management of Hazardous Wastes, Substances and Pollutants
Program 2.2:	Sustainable Communities
Outcome 3
Program 3.1:	Antarctica: Science, Policy and Presence
Outcome 4
Program 4.1:	Water Reform
Outcome 5
Program 5.1:	Conservation of Australia’s Heritage and Environment
Program 5.2:	Environmental Regulation
Outcome 6
Program 6.1:	Commonwealth Environmental Water

2. 
   Basis of Preparation of the Financial Statements
   

The financial statements are general purpose financial statements and are required by section 49 of the Financial Management and Accountability Act 1997.

The financial statements have been prepared in accordance with:

• 
  Finance Minister’s Orders (FMOs) for reporting periods ending on or after 1 July 2011; and
  
• 
  Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that apply for the reporting period.
  

The financial statements have been prepared on an accrual basis and in accordance with the historical cost convention, except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.

The financial statements are presented in Australian dollars and values are rounded to the nearest thousand dollars unless otherwise specified.

Unless an alternative treatment is specifically required by an accounting standard or the FMOs, assets and liabilities are recognised in the balance sheet when and only when it is probable that future economic benefits will flow to the Department or a future sacrifice of economic benefits will be required and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under executory contracts are not recognised unless required by an accounting standard. Liabilities and assets that are unrecognised are reported in the schedule of commitments or the schedule of contingencies.

Unless alternative treatment is specifically required by an accounting standard, income and expenses are recognised in the Statement of Comprehensive Income when and only when the flow, consumption or loss of economic benefits has occurred and can be reliably measured.

3. 
   Significant Accounting Judgements and Estimates
   

In the process of applying the accounting policies listed in this note, the Department has made the following estimates and judgements that have the most significant impact on the amounts recorded in the financial statements:

• 
  The estimated values for the Antarctic and Sub-Antarctic related restoration obligations and related assets have been arrived at on a reasonableness basis. Further details on the valuation methodology are provided at Note 1.20.
  
• 
  Water entitlements are carried at cost where there is no active market. When an active market exists they are carried at fair value. Refer to Note 1.24, Water Entitlements, for further information.
  

No other accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next reporting period.