Queensland’s Accounting & Reporting Framework - Departments & Statutory Bodies Financial Reporting Requirements (FRRs) Non-Current Asset Policies for the Queensland Public Sector (NCAPs) Financial Management Framework For departments and statutory bodies Financial Accountability Act 2009 (FA Act) Financialand Performance Management Standard 2009 (FPMS) Other policy documents Australian Accounting Standards This is trial version www.adultpdf.com Queensland’s Accounting & Reporting Framework – Government Owned Corporations (GOCs) Financial Management Framework for Government Owned Corporations Corporations Act 2001 Government Owned Corporations Act 1993 Government Owned Corporations Regulation 2004 Subsidiary Policy Documents (eg. Code of Practice for GOC Financial Arrangements) Australian Accounting Standards This is trial version www.adultpdf.com Queensland’s Accounting & Reporting Framework – Local Governments Legislation administered by Department of Local Government and Planning (DLGP) Financial Management Framework Local Governments Guidance – Tropical Council Financial Statements Local Government Act 2009 (Effective July 2010) Local Government (Beneficial Enterprises and Business Activities) Regulation 2010 Local Government (Finance, Plans and Reporting) Regulation 2010 Local Government (Operations) Regulation 2010 Australian Accounting Standards A guide to asset accounting in Local Government s This is trial version www.adultpdf.com Defining “Grants” • Definition of ‘grants’: – “ generic term applied to funding or other incentives provided to individuals or bodies (including community groups, statutory bodies or commercial enterprises) that exhibit some of the following characteristics: • a transfer to a recipient which may be in return for compliance with certain terms and conditions • a transfer which may not directly give approximately equal value in return to the Government • a recipient may have been selected on merit against a set of program-specific criteria ” – Source: Queensland Treasury’s Financial Accountability Handbook • Examples – Recurrent/Operating grants - Capital grants (eg to purchase/construct building) – Assets acq. at below market values - Donation (eg donation of assets) – Loans issued at below market rates - Loan forgiveness – Rebates - Tax relief This is trial version www.adultpdf.com Grant Data - State • Queensland’s Whole-of-Government Sector total grant revenue (excludes Local Government sector) 2010 2009 2008 2007 $M $M $M $M Total Grant Revenue 20,352 17,596 16,006 14,479 % of Total Revenue 45% 40% 39% 35% (Source: Report on State Finances 2007 to 2010) This is trial version www.adultpdf.com Accounting for Grants (Grantee/Recipient) •Applicable Accounting Standards: – AASB 118 Revenue • Applicable to all entities • Reciprocal grants – AASB 1004 Contributions • Applicable to not-for-profits (i.e Departments, most Statutory Bodies and Local Governments) • Non-reciprocal grants – AASB 120 Accounting for Government Grants and Disclosure of Government Assistance • Applicable to for-profits (i.e. Government Owned Corporations and some Statutory Bodies) Note:- IPSAS 23 Revenue from Non-Exchange Transactions (Taxes and Transfers) is not relevant in Australia This is trial version www.adultpdf.com Reciprocal Vs Non-Reciprocal • Reciprocal transfer – a transfer in which the entity transacts with a party and gives approximately equal value in exchange • eg. research grant where grantor has first right to research results • Non-reciprocal transfer (AASB 1004.Appendix A) – a transfer in which the entity transacts with a party without giving approximately equal value in exchange • eg. grant paid to sporting club to deliver sport program to community This is trial version www.adultpdf.com AASB 1004 Contributions (Accounting for Grants) • Applicable to not-for-profits entities preparing general purpose financial statements • Provides guidance on the recognition of ‘contributions’ (including ‘contributions’ of services) • Definition of contribution - “ a non-reciprocal transfer in which an entity receives assets or services, or has liabilities extinguished, without directly giving approx. equal value in exchange to the other party ”. • Form of contribution: 1. involuntary (rates, taxes, fines) 2. voluntary (non-reciprocal grants, donations) 3. parliamentary appropriations This is trial version www.adultpdf.com AASB 1004 Contributions (cont’d) (Accounting for Grants) • Recognition requirements (AASB 1004.20): – Recognised as income in the period in which the funding is received or receivable – subject to meeting recognition criteria (control, probable, measurable) and – irrespective of whether restrictions or conditions are imposed on the use of the contribution • Measurement requirements (AASB 1004.11): – must be measured at the fair value of the contributions received or receivable This is trial version www.adultpdf.com AASB 1004 Contributions (cont’d) (Accounting for Grants) • ‘Control’ is achieved when (AASB 1004.27): – the grantee can “benefit from funds transferred to it and deny or regulate the access of others to those benefits” • for grants received before services provided – control achieved when entity meets eligibility criteria (i.e. generally achieved when cash is received and available for use) • for grants received after services provided – control achieved when services or facilities under grant agreement have been provided This is trial version www.adultpdf.com . (NCAPs) Financial Management Framework For departments and statutory bodies Financial Accountability Act 2009 (FA Act) Financial and Performance Management Standard 2009 (FPMS) Other policy documents Australian. Financial Statements Local Government Act 2009 (Effective July 2 010) Local Government (Beneficial Enterprises and Business Activities) Regulation 2 010 Local Government (Finance, Plans and. Corporations Act 19 93 Government Owned Corporations Regulation 2004 Subsidiary Policy Documents (eg. Code of Practice for GOC Financial Arrangements) Australian Accounting Standards This is