Income

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.

Appropriation

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