Income encompasses both revenue and gains.
Income is recognised at the fair value of the consideration received, exclusive of the amount of GST. Exchanges of goods or services of the same nature and value without any cash consideration being exchanged are not recognised as income.
Grants and other contributions
Grants, donations, gifts and other non-reciprocal contributions are recognised as revenue when the department obtains control over the assets comprising the contributions. Control is normally obtained upon receipt.
Contributions are recognised at their fair value. Contributions of services are only recognised when a fair value can be reliably determined and the services would be purchased if not donated.
Output appropriation is the operating payment to each department for the outputs they provide and is calculated as the net cost of department outputs after taking into account funding from department income. It does not include any allowance for major non-cash costs, such as depreciation.
Output appropriation is apportioned between the output groups based on the cost of delivering the department’s strategic priorities.
Commonwealth appropriation follows from the Intergovernmental Agreement on Federal Financial Relations, resulting in Specific Purpose Payments (SPPs) and National Partnership (NP) payments being made by the Commonwealth Treasury to state treasuries, in a manner similar to arrangements for GST payments. These payments are received by the Department of Treasury and Finance on behalf of the Central Holding Authority and then passed on to the relevant agencies as Commonwealth appropriation.
Revenue in respect of appropriations is recognised in the period in which the department gains control of the funds.
Sale of goods
Revenue from the sale of goods is recognised (net of returns, discounts and allowances) when:
- the significant risks and rewards of ownership of the goods have been transferred to the buyer
- the department retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over the goods sold
- the amount of revenue can be reliably measured
- it is probable that the economic benefits associated with the transaction will flow to the department
- the costs incurred or to be incurred in respect of the transaction can be measured reliably.
Rendering of services
Revenue from rendering services is recognised by reference to the stage of completion of the contract. The revenue is recognised when:
- the amount of revenue, stage of completion and transaction costs incurred can be reliably measured
- it is probable that the economic benefits associated with the transaction will flow to the entity.
ANNUAL REPORT 2018-19 - DEPARTMENT OF PRIMARY INDUSTRY AND RESOURCES
Last updated: 23 October 2019
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