Declaration by Chair, Agency Management Committee, Chief Executive Officer, Executive Director, Business Services and Chief Financial Officer.
The Australian Health Practitioner Regulation Agency (AHPRA), working in partnership with the 14 National Boards, recorded a surplus of $1.852 million for the financial year 2015/16. This was similar to the $1.861 million recorded for the financial year 2014/15.
Equity held by AHPRA on behalf of the 14 National Boards as at 30 June 2016 was $86.756 million, an increase of $1.852 million from 30 June 2015 through accumulated surplus during the 2015/16 financial year. The last contribution to contributed capital was in 2012/13 and related to the 2012 addition of four professions to the National Registration and Accreditation Scheme. The contributed capital component of equity is $43.895 million, and is attributed to the National Boards.
It is expected that the National Boards will have reasonable and sufficient equity to cover their commitments. To reduce some equity levels National Boards will deliberately utilise these funds to cover operational expenditure, including funding the replacement of core business infrastructure during 2016/17.
Total income from transactions was $170.929 million during the 2015/16 financial year, an increase of $0.466 million from 2014/15. The growth was due to an increase in the number of registrants throughout the year and Consumer Price Index increase for four of the National Boards, with the remaining National Boards reducing or maintaining their registration fees during the year.
Total expenses from transactions were $169.077 million, an increase of $0.475 million from the 2014/15 financial year. Though staffing increased by indexation during the year, this was offset by less spending on travel and accommodation, external legal expenditure and accreditation.
AHPRA’s net assets increased by $1.852 million during the year to $86.756 million. Cash and cash equivalents combined with investments remained similar to the previous year ($174.421 million to 30 June 2016, compared with $167.217 million at 30 June 2015). The most significant change was that investments classified as non-current increased from $71 million to $119 million, reflecting the change in maturity timeframes for a number of the investments due to the cash flow requirements of the business.
Overall the balance sheet is healthy and the largest contributor to this is both cash and cash equivalents, and investments held by AHPRA.
An organisational transformation program will continue during 2016/17 and will require the partial use of accumulated surpluses from previous years. Overall, after several years of increased equity we expect equity to reduce from its current level of $86.756 million in 2016/17.
It is expected that AHPRA, in partnership with the National Boards, will continue to be solvent throughout 2016/17. The next five year financial strategy, which will commence from 2017, will be important to ensure the long-term financial sustainability to fund the work of the National Registration and Accreditation Scheme.
We certify that the attached financial statements for the Australian Health Practitioner Regulation Agency have been prepared in accordance with Schedule 3, Part 3 of the Health Practitioner Regulation National Law Act 2009 as in force in each state and territory (the National Law), Australian Accounting Standards and Interpretations, and other mandatory professional reporting requirements.
We further state that, in our opinion, the information set out in the Comprehensive Income Statement, Balance Sheet, Statement of Changes in Equity, Cash Flow Statement and notes to and forming part of the financial statements, presents fairly the financial transactions for the year ended 30 June 2016 and the financial position of the Australian Health Practitioner Regulation Agency as at 30 June 2016.
We are not aware of any circumstance which would render any particulars included in the financial statements to be misleading or inaccurate.
We were authorised by the Agency Management Committee to issue the attached financial statements on this day.
Michael Gorton
Chair, Agency Management Committee
26 August 2016
Sarndrah Horsfall
Executive Director, Business Services
26 August 2016
Martin Fletcher
Chief Executive Officer
26 August 2016
Anthony DeJong
National Director Finance and Procurement
(Chief Financial Officer)
26 August 2016
The statement of comprehensive income should be read in conjunction with the accompanying notes.
The statement of financial position should be read in conjunction with the accompanying notes.
The statement of changes in equity should be read in conjunction with the accompanying notes.
All amounts are inclusive of Goods and Services Tax (GST).
The statement of cash flows should be read in conjunction with the accompanying notes.
Income is recognised to the extent that it is probable that the economic benefits will flow to AHPRA and it can be reliably measured.
Registrations are payable periodically in advance. Only those registration fees that are attributable to the current financial year are recognised as income. Registration fees that relate to future periods are recorded as income in advance within the statement of financial position.
Where a person pays an application fee, the fee is recognised in the financial year in which it is received.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Registration fees | 151,172 | 150,411 |
| Application fees | 9,866 | 9,287 |
| Total registration fee income | 161,038 | 159,698 |
| Income in advance | 2016 $'000 | 2015 $'000 |
|---|---|---|
| Aboriginal and Torres Strait Islander Health Practice Board of Australia | 19 | 24 |
| Chinese Medicine Board of Australia | 813 | 904 |
| Chiropractic Board of Australia | 958 | 915 |
| Dental Board of Australia | 3,871 | 3,735 |
| Medical Board of Australia | 15,171 | 14,361 |
| Medical Radiation Practice Board of Australia | 944 | 1,353 |
| Nursing and Midwifery Board of Australia | 43,357 | 42,203 |
| Occupational Therapy Board of Australia | 861 | 1,027 |
| Optometry Board of Australia | 618 | 646 |
| Osteopathy Board of Australia | 285 | 290 |
| Pharmacy Board of Australia | 3,136 | 3,040 |
| Physiotherapy Board of Australia | 1,187 | 1,578 |
| Podiatry Board of Australia | 640 | 622 |
| Psychology Board of Australia | 5,113 | 4,935 |
| Total income in advance | 76,973 | 75,633 |
Interest income is accrued by reference to the principal of a financial asset at the effective interest rate when earned.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Interest on term deposits | 5,861 | 6,543 |
| Total interest income | 5,861 | 6,543 |
Interest earned but not received in the bank is recorded as accrued income in the statement of financial position.
| Accrued income | 2016 $'000 | 2015 $'000 |
|---|---|---|
| Accrued interest on term deposits | 2,410 | 2,695 |
| Other accrued income | 4 | 33 |
| Total accrued income E2(b) | 2,414 | 2,728 |
Other income includes income that is not registration fees or interest. Key items of other income include certificates of registration status requested by registrants, legal fee recoveries and fees related to the Pharmacy Board of Australia’s examinations.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Accreditation | 145 | 245 |
| Certificate of registration status | 464 | 449 |
| Government grants | 260 | 0 |
| Legal fee recovery | 1,708 | 1,743 |
| Pharmacy Board of Australia examinations | 928 | 1,032 |
| Other | 525 | 753 |
| Total other income | 4,030 | 4,222 |
Expenses from transactions are recognised in the statement of comprehensive income when they are incurred.
Board and committee sitting fee costs include national, state and regional board expenditure relating to meetings held by the boards and their committees.
Legal costs include external costs relating to managing the notification (complaint) process by AHPRA. These costs include legal fees paid to external firms and costs of civil tribunals. They do not include the costs associated with AHPRA staff in the assessment and investigation of notifications, or the cost of legal staff employed by AHPRA.
Accreditation expenses (external) relate to payments to external accreditation bodies to exercise accreditation functions, as defined in Section 42 of the National Law. Staff costs and committee sitting fees when these functions are carried out by board committees are not included.
ATSIHPBA, CMBA and MRPBA have assigned accreditation functions under Section 42 of the National Law to accreditation committees administered by AHPRA.
Accrediting activities relating to registration of health practitioners under Section 52 of the National Law are disclosed separately. During 2015/16, funding for accrediting activities of $957k (2015: $999k) were incurred for intern training accreditation authorities (refer to Note A4(1)).
AHPRA incurs the following expenses and then proportionally allocates the expenditure to the National Boards, based on an agreed formula. The formula is based on an analysis of historical and financial data to estimate the proportion of AHPRA costs required to regulate each profession. Costs include salaries, systems and communication, property and administration costs. AHPRA supports the work of the National Boards by employing all staff and providing systems and infrastructure to manage registration, compliance and notification functions, as well as the support services necessary to run a national organisation with eight state and territory offices.
Comparative figures have been adjusted to conform to changes in presentation for the current financial year. The adjustments were made as the Health Profession Agreement (HPA) between AHPRA and each of the National Boards re-classified expenditure categories for 2015/16. These changes are summarised below:
| 2015 reported $'000 | 2015 adjusted $'000 | |
|---|---|---|
| Board sitting fees and direct board costs | 10,247 | 5,854 |
| Staffing costs | 92,226 | 92,583 |
| Travel and accommodation | 2,316 | 6,646 |
| Administration costs | 13,557 | 13,263 |
| Total expenses from transactions | 118,346 | 118,346 |
| Net result for the year | 1,861 | 1,861 |
Board sitting fees and direct board costs in 2015 included direct board costs for staffing, and travel and accommodation. These direct board costs have been re-classified as follows:
Administration costs in 2015 included conference and venue hire. These costs have been re-classified to travel and accommodation.
Administration expenses include corporate legal, bank charges and merchant fees, postage, freight and couriers, printing and stationery, insurance and recruitment.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Bank charges and merchant fees | 755 | 486 |
| Criminal history checks | 1,164 | 1,110 |
| External contract services | 1,692 | 2,422 |
| Funding for intern training accreditation authorities for registration of health practitioners (Section 52) | 957 | 999 |
| Health programs | 1,684 | 1,159 |
| Insurance | 1,002 | 1,147 |
| Internal audit fees | 119 | 130 |
| Legal - corporate | 396 | 352 |
| Meals and catering | 422 | 415 |
| National Health Practitioner Ombudsman and Privacy Commissioner Office | 1,500 | 1,500 |
| Pharmacy Board of Australia examinations | 481 | 515 |
| Printing, postage, freight and courier | 2,100 | 2,022 |
| Publications | 363 | 306 |
| Recruitment | 338 | 309 |
| Other | 919 | 391 |
| Total administration expenses | 13,892 | 13,263 |
Assets, liabilities, income or expenses arise from past transactions or other past events.
Where transactions result from an agreement between AHPRA and other parties, the transactions are only recognised when the agreement is irrevocable at or before the end of the reporting period.
Adjustments are made to amounts recognised in the financial statements for events which occur between the end of the reporting period and the date when the financial statements are authorised for issue, where those events provide information about conditions which existed at the reporting date.
Note that disclosure is made about events between the end of the reporting period and the date the financial statements are authorised for issue where the events relate to conditions which arose after the end of the reporting period that are considered to be of material interest.
No subsequent events are indentifed for disclosure in this report.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Net result for the year | 1,852 | 1,861 |
| Adjustments for: | ||
| Depreciation | 4,912 | 3,861 |
| (Gain) / loss on disposal of assets | (15) | 4 |
| Write off work in progress / assets | 870 | 49 |
| Recognition of lease assets | 577 | (577) |
| Make good provision | 617 | 60 |
| Provision for doubtful debts | 370 | 59 |
| Changes in assets and liabilities | ||
| (Increase) / decrease in receivables | (217) | 219 |
| (Increase) in prepayments | (559) | (50) |
| Decrease in accrued income | 314 | 727 |
| Increase / (decrease) in income in advance | 1,340 | (1,635) |
| (Decrease) in payables and accruals | (2,229) | (1,920) |
| Increase in employee benefits | 2,145 | 1,750 |
| (Decrease) / increase in lease liability | (350) | 3,325 |
| Net cash flows from operating activities | 9,627 | 7,733 |
Receivables consist of:
The terms of trade are 30 days from invoice date. Receivables are recognised and carried at original invoice amount less any allowance for any uncollectable amounts. Receivables are subject to annual impairment testing. A provision for doubtful receivables is recognised when collection of the full amount is no longer probable. Bad debts are written off when identified, and recognised as an expense in the statement of comprehensive income.
| Note | 2016 $'000 | 2015 $'000 | |
|---|---|---|---|
| Trade receivables | E2 | 1,255 | 859 |
| Less allowances for doubtful debts | (681) | (311) | |
| GST receivable | 685 | 864 | |
| Total receivables | 1,259 | 1,412 | |
| Movement in the allowance for doubtful debts | |||
| Balance at beginning of year | 311 | 252 | |
| Increase in allowance recognised in net result for the year | 381 | 79 | |
| Decrease in amounts written off as uncollectable | (11) | (20) | |
| Balance at end of year | 681 | 311 |
Payables are recognised at fair value. Payables represent liabilities for goods and services provided to AHPRA prior to the end of the financial year that are unpaid, and arise when AHPRA is obliged to make future payments in respect of the purchase of goods and services. Terms of settlement are generally 30 days from the date of invoice.
| Note | 2016 $'000 | 2015 $'000 | |
|---|---|---|---|
| Trade creditors | E2 | 1,885 | 2,130 |
| Accrued expenses | E2 | 7,800 | 9,784 |
| Total payables and accruals | 9,685 | 11,914 |
Plant and equipment (PE) is measured at cost less accumulated depreciation and impairment. These assets are depreciated at rates based on their expected useful lives, using the straight-line method, which is reviewed annually.
The annual depreciation rates used for major assets in each class are as follows:
| 2016 | 2015 | |
|---|---|---|
| Furniture and fittings | 13% | 13% |
| Computer equipment | 20% to 40% | 20% to 40% |
| Office equipment | 15% | 15% |
Leasehold improvements are amortised over the term of the lease, or the life of the assets, whichever is shorter.
Work in progress is not depreciated until it reaches service delivery capacity.
| Leasehold improvements $'000 | Furniture and fittings $'000 | Computer equipment $'000 | Office equipment $'000 | Total PE$'000 | |
|---|---|---|---|---|---|
| At cost | |||||
| Balance at 30 June 2014 | 6,098 | 658 | 1,664 | 219 | 8,639 |
| Additions | 3,039 | 36 | 340 | 36 | 3,451 |
| Disposals/write offs | (658) | (43) | 0 | (27) | (728) |
| Balance at 30 June 2015 | 8,479 | 651 | 2,004 | 228 | 11,362 |
| Additions | 753 | 58 | 724 | 13 | 1,548 |
| Disposals/write offs | 0 | 0 | (321) | 0 | (321) |
| Balance at 30 June 2016 | 9,232 | 709 | 2,407 | 241 | 12,589 |
| Accumulated depreciation | |||||
| Balance at 30 June 2014 | (3,077) | (237) | (1,002) | (82) | (4,398) |
| Depreciation charge during the year | (972) | (87) | (541) | (35) | (1,635) |
| Disposals/write offs | 640 | 14 | 0 | 13 | 667 |
| Balance at 30 June 2015 | (3,409) | (310) | (1,543) | (104) | (5,366) |
| Depreciation charge during the year | (1,102) | (86) | (530) | (35) | (1,753) |
| Disposals/write offs | 0 | 0 | 285 | 0 | 285 |
| Balance at 30 June 2016 | (4,511) | (396) | (1,788) | (139) | (6,834) |
| Net book value | |||||
| At 30 June 2015 | 5,070 | 341 | 461 | 124 | 5,996 |
| At 30 June 2016 | 4,721 | 313 | 619 | 102 | 5,755 |
All non-financial assets are assessed annually for indications of impairment. If there is an indication of impairment, the asset concerned is tested as to whether its carrying amount exceeds its possible recoverable amount. The difference is written off as an expense except to the extent that the write down can be debited to an asset revaluation surplus amount applicable to that same class of asset.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Office equipment | 0 | 14 |
| Furniture and fittings | 0 | 17 |
| Leasehold improvement | 0 | 18 |
| Intangible assets | 870 | 0 |
| Total written down value of non-current assets written off | 870 | 49 |
The net gain or loss arising from the sale of non-current assets is included as revenue (Other Income) or expenses (Administration Expenses – Other) at the date control passes to the buyer, usually when an unconditional contract of sale is signed.
The net gain or loss on disposal is calculated as the difference between the carrying amount of the asset at the time of the disposal and the net proceeds on disposal.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Proceeds from disposals of non-current assets | ||
| Furniture and fittings | 0 | 8 |
| Computer equipment | 51 | 0 |
| Total proceeds from disposal of non-current assets | 51 | 8 |
| Less: written down value of non-current assets sold | ||
| Furniture and fittings | 0 | (12) |
| Computer equipment | (36) | 0 |
| Net gain/(loss) on disposal of non-financial assets | 15 | (4) |
When the recognition criteria in AASB138 Intangible Assets is met, internally generated intangible assets are recognised and measured at cost less accumulated amortisation and accumulated impairment.
An internally generated intangible asset arising from development (or from the development phase of an internal project) is recognised if, and only if, all of the following are demonstrated:
Intangible assets are amortised annually at a rate of between 10% and 40% depending on their useful life.
Expenditure on research activities is recognised as an expense in the period in which it is incurred.
Expenditure in developing internally-generated intangible asset are recorded as work in progress before they reach completion. These work in progress expenses were reported under Plant and equipment in 2014/15 but reclassified to be included in intangibles assets in 2015/16.
| Computer software $'000 | WIP $'000 | Total $'000 | |
|---|---|---|---|
| At cost | |||
| Balance at 30 June 2014 | 6,140 | 2,643 | 8,783 |
| Additions | 3,163 | 4,438 | 7,601 |
| Transfer to additions | 0 | (3,162) | (3,162) |
| Balance at 30 June 2015 | 9,303 | 3,919 | 13,222 |
| Additions | 2,831 | 750 | 3,581 |
| Disposals/write offs | 0 | (870) | (870) |
| Transfer to additions | 0 | (2,655) | (2,655) |
| Balance at 30 June 2016 | 12,134 | 1,144 | 13,278 |
| Accumulated amortisation | |||
| Balance at 30 June 2014 | (2,316) | 0 | (2,316) |
| Amortisation during the year | (2,226) | 0 | (2,226) |
| Disposals/write offs | 0 | 0 | 0 |
| Balance at 30 June 2015 | (4,542) | 0 | (4,542) |
| Amortisation charge during the year | (3,159) | 0 | (3,159) |
| Balance at 30 June 2016 | (7,701) | 0 | (7,701) |
| Net book value | |||
| At 30 June 2015 | 4,761 | 3,919 | 8,680 |
| At 30 June 2016 | 4,433 | 1,144 | 5,577 |
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Depreciation | ||
| Leasehold improvements | 1,102 | 972 |
| Furniture and fittings | 86 | 87 |
| Computer equipment | 530 | 541 |
| Office equipment | 35 | 35 |
| Amortisation | ||
| Computer software | 3,159 | 2,226 |
| Total depreciation and amortisation | 4,912 | 3,861 |
Contingent assets and contingent liabilities are not recognised in the statement of financial position, but are disclosed by way of note and, if quantifiable, are measured at nominal value. Contingent assets and contingent liabilities are presented inclusive of GST receivable or payable respectively.
| Contingent assets | 2016 $'000 | 2015 $'000 |
|---|---|---|
| Legal proceeding and disputes | 0 | 0 |
No claim for damages was lodged during the year.
| Contingent liabilities | 2016 $'000 | 2015 $'000 |
|---|---|---|
| Legal proceeding and disputes | 0 | 0 |
Claims for damages were lodged during the year. Liabilities have been disclaimed and the actions have been defended. Insurers are involved in defending these matters. The extent to which an outflow of funds is required in excess of insurance is dependent on the case outcomes being more or less favourable than currently expected.
Cash and cash equivalents include cash on hand and cash at bank, deposits held at call, and other short-term liquid deposits with an original maturity of three months or less, which are readily convertible to known amounts of cash with an insignificant risk of changes in value.
| Note | 2016 $'000 | 2015 $'000 | |
|---|---|---|---|
| Cash and cash equivalents, at bank | 3,421 | 6,217 | |
| Total cash and cash equivalents | E2 | 3,421 | 6,217 |
Investments include term deposits for which AHPRA has the positive intent and ability to hold to maturity at fixed or repricing interest rates.
| Note | 2016 $'000 | 2015 $'000 | |
|---|---|---|---|
| Current | |||
| Term deposits less than 90 days | 15,000 | 0 | |
| Bank term deposits more than 90 days but less than 1 year | 37,000 | 90,000 | |
| Non-current | |||
| Bank term deposits greater than 1 year | 119,000 | 71,000 | |
| Total investments | E2 | 171,000 | 161,000 |
Consistent with the requirements of AASB 1004 Contributions, contributions by owners (that is, contributed capital) are treated as equity transactions and, therefore, do not form part of the income and expenses of AHPRA.
Additions to net assets which have been designated as contributions by government or statutory bodies are recognised as contributed capital.
| ATSHIBA $'000 | CMBA $'000 | Chiro BA $'000 | DBA $'000 | MBA $'000 | MRP BA $'000 | NMBA $'000 | OTBA $'000 | OptomBA $'000 | OsteoBA $'000 | PharmBA $'000 | PhysioBA $'000 | PodBA $'000 | PsyBA $'000 | Other $'000 | Total $'000 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Contributed capital | 276 | 1,293 | 1,164 | 3,120 | 12,257 | 2,218 | 12,816 | 3,574 | 1,061 | 996 | 2,716 | 2,728 | 420 | 2,194 | (2,938) | 43,895 |
| Accumulated net result to 30 June 2015 | 68 | 1,595 | 248 | 521 | 5,848 | 3,963 | 12,642 | 4,160 | 666 | 234 | 3,124 | 4,063 | 1,315 | (376) | 2,938 | 41,009 |
| Equity at 30 June 2015 | 344 | 2,888 | 1,412 | 3,641 | 18,105 | 6,181 | 25,458 | 7,734 | 1,727 | 1,230 | 5,840 | 6,791 | 1,735 | 1,818 | 0 | 84,904 |
| 2015/16 net result | 0 | 912 | 259 | 0 | 4,810 | 0 | 0 | 62 | 176 | 0 | 0 | 0 | 357 | 282 | 0 | 6,858 |
| 2015/16 result funded from equity | (22) | 0 | 0 | (29) | 0 | (324) | (3,599) | 0 | 0 | (58) | (633) | (341) | 0 | 0 | 0 | (5,006) |
| Total | (22) | 912 | 259 | (29) | 4,810 | (324) | (3,599) | 62 | 176 | (58) | (633) | (341) | 357 | 282 | 0 | 1,852 |
| Accumulated net result to 30 June 2016 | 46 | 2,507 | 507 | 492 | 10,658 | 3,639 | 9,043 | 4,222 | 842 | 176 | 2,491 | 3,722 | 1,672 | (94) | 2,938 | 42,861 |
| Equity at 30 June 2016 | 322 | 3,800 | 1,671 | 3,612 | 22,915 | 5,857 | 21,859 | 7,796 | 1,903 | 1,172 | 5,207 | 6,450 | 2,092 | 2,100 | 0 | 86,756 |
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| (a) Contributed capital | ||
| Balance at the beginning of financial year | 43,895 | 43,895 |
| Capital contributions from former boards | 0 | 0 |
| Balance at end of financial year | 43,895 | 43,895 |
| (b) Accumulated surplus | ||
| Balance at the beginning of financial year | 41,009 | 39,148 |
| Net result for the year | 1,852 | 1,861 |
| Balance at end of financial year | 42,861 | 41,009 |
Operating lease payments are recognised as an expense on a straight-line basis over the lease term AHPRA is not party to a finance lease.
In the event that lease incentives are received to enter into operating leases, the aggregate cost of incentives are recognised as a reduction of rental expense over the lease term on a straight-line basis.
During 2014/15, AHPRA entered into a new 10-year underlease office agreement. The lease contract includes a $3.5 million lease incentive clause. AHPRA has recognised this as a lease liability which is reduced over the term of the lease. The lease incentive comprised reimbursement for the fit out of the new premises and a rent-free period. The rent-free period is recorded as a leased asset and reduced over the rent-free period.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Leased assets | 0 | 577 |
| Lease liabilities | 2,975 | 3,325 |
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Opening balance | 60 | 0 |
| Additional provisions required | 617 | 60 |
| Reductions arising from payments | 0 | 0 |
| Closing balance | 677 | 60 |
| Current | 306 | 0 |
| Non-current | 371 | 60 |
| Total | 677 | 60 |
Commitments include operating and capital commitments arising from non-cancellable contractual or statutory obligations. All amounts shown in the commitments note are inclusive of GST.
Commitments (including GST) in relation to operating leases are payable as:
| Non-cancellable: | 2016 $'000 | 2015 $'000 |
|---|---|---|
| Not later than 1 year | 8,979 | 8,596 |
| Later than 1 year but not later than 5 years | 15,347 | 17,908 |
| Later than 5 years | 8,508 | 8,250 |
| Total operating leases | 32,834 | 34,754 |
Employee benefits including non-monetary benefits and annual leave are recognised in the provision for employee benefits as current liabilities.
When the annual leave is expected to wholly settle within 12 months of the reporting date, it is measured at its nominal value. Those liabilities not expected to be wholly settled within 12 months of the reporting date are measured at the present value of the amounts expected to be paid when the liabilities are settled using remuneration rates expected to apply at the time of settlement.
The long service leave entitlement under existing arrangements is recognised from an employee’s commencement date and becomes payable according to the employment arrangements in place. The valuation of long service leave for employees who have met the conditions of service to take long service leave is recognised as a current liability, whilst the valuation for those employees still to meet the conditions of service is recognised as a non-current liability.
Part of the current liability is measured at nominal value when it is expected to wholly settle within 12 months of the reporting date. When liabilities are not expected to wholly settle within 12 months of the reporting date, they are measured at the present value of the expected future payments to be made in respect of services provided by employees up to the reporting date. Consideration is given to expected future wage and salary levels, experience of employee departures, and periods of service. Expected future payments are discounted using interest rates on national government guaranteed securities with terms to maturity that match, as closely as possible, the estimated future cash outflows.
Termination benefits are payable when employment is terminated before the normal retirement date or when an employee accepts voluntary redundancy in exchange for these benefits. AHPRA recognises termination benefits when it demonstrably committed to either terminating the employment of current employees according to a detailed formal plan without possibility of withdrawal or providing termination benefits as a result of an offer made to encourage voluntary redundancy. Benefits falling due more than 12 months after the end of the reporting period are discounted to present value.
Employee benefits on-costs include payroll tax, workcover insurance premium and superannuation entitlements. The benefits on-costs are recognised as liabilities when the employee benefits to which they relate are recognised.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Current | ||
| Unconditional annual leave expected to be settled within 12 months | 5,645 | 5,115 |
| Unconditional annual leave expected to be settled after 12 months | 1,754 | 1,215 |
| Unconditional long service leave expected to be settled within 12 months | 4,593 | 3,922 |
| Total current employee benefits and on-costs | 11,992 | 10,252 |
| Non-current | ||
| Conditional long service leave entitlements expected to be settled after 12 months | 2,728 | 2,323 |
| Total non-current employee benefits and on-costs | 2,728 | 2,323 |
| Total employee benefits and on-costs | 14,720 | 12,575 |
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Current employee benefits | ||
| Annual leave | 6,302 | 5,342 |
| Long service leave | 3,876 | 3,310 |
| Non-current employee benefits | ||
| Long service leave | 2,302 | 1,960 |
| Total employee benefits | 12,480 | 10,612 |
| Current on-costs | 1,814 | 1,600 |
| Non-current on-costs | 426 | 363 |
| Total on-costs | 2,240 | 1,963 |
| Total employee benefits and on-costs | 14,720 | 12,575 |
| Annual leave $'000 | Long service leave $'000 | Total $'000 | |
|---|---|---|---|
| Opening balance | 6,330 | 6,245 | 12,575 |
| Additional provisions required | 8,237 | 1,737 | 9,974 |
| Reductions arising from payments | (7,168) | (661) | (7,829) |
| Closing balance | 7,399 | 7,321 | 14,720 |
| Current | 7,399 | 4,593 | 11,992 |
| Non-current | 0 | 2,728 | 2,728 |
| Total | 7,399 | 7,321 | 14,720 |
| Income | 2016 Number | 2015 Number |
|---|---|---|
| $0 - $ 9,999 | 4 | 5 |
| $10,000 - $19,999 | 4 | 1 |
| $20,000 - $29,999 | 1 | 1 |
| $50,000 - $59,999 | 0 | 1 |
| Total numbers | 9 | 8 |
| Total amount | 94,097 | 119,067 |
Remuneration shown above includes all committee meetings the Agency Management Committee members attended.
The Chief Executive Officer (CEO) is Mr Martin Fletcher who held the position for the period 1 July 2015 to 30 June 2016.
The aggregate compensation made to the CEO and Executive Directors is set out below:
| 2016 | 2015 | |
|---|---|---|
| Short-term employee benefits | 1,194,882 | 1,112,616 |
| Post-employment benefits | 84,422 | 78,583 |
| Termination benefits | 0 | 96,199 |
| 1,279,304 | 1,287,398 | |
| Total number of executives | 4 | 5 |
| Total annualised employee equivalents | 4 | 3.8 |
Mr Michael Gorton AM is a principal of Russell Kennedy Solicitors which provides legal services on notification matters to AHPRA on normal commercial terms and conditions.
Mr Michael Gorton is also a board member of Melbourne Health During the year, AHPRA engaged in transaction with Melbourne Health on normal commercial terms.
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Russell Kennedy Solicitors | 419 | 396 |
| Melbourne Health | 2 | 0 |
The amount expensed in respect of superannuation represents AHPRA contributions for members of both defined benefit and defined contribution superannuation plans that are paid or payable during the reporting period.
Employees of AHPRA are entitled to receive superannuation benefits and AHPRA contributes to both defined benefit and defined contribution plans. The defined benefit plans provide benefits based on years of service and final average salary.
AHPRA does not recognise any defined benefit liability in respect of the plans because it has no legal or constructive obligation to pay future benefits relating to its employees; its only obligation is to pay superannuation contributions as they fall due.
Superannuation contributions paid or payable for the reporting period are included as part of staffing costs in AHPRA’s statement of comprehensive income.
The name, details and amounts expensed in relation to the major employee superannuation funds and contributions made by AHPRA are as follows:
| Fund | Paid contribution for the year 2016 $'000 | Paid contribution for the year 2015 $'000 | Contribution outstanding at year end 2016 $'000 | Contribution outstanding at year end 2016 $'000 |
|---|---|---|---|---|
| Defined benefit plans: | ||||
| Gold state | 106 | 46 | 10 | 0 |
| Q super | 227 | 150 | 9 | 0 |
| Other | 89 | 79 | 3 | 0 |
| Defined contribution plans: | ||||
| AGEST super | 1,354 | 1,379 | 48 | 47 |
| Australian super | 1,361 | 1,023 | 66 | 45 |
| First state accumulation fund | 278 | 277 | 6 | 9 |
| Qsuper accumulation V2 | 369 | 293 | 30 | 14 |
| VicSuper FutureSaver | 394 | 339 | 16 | 13 |
| Other | 4,413 | 4,073 | 194 | 251 |
| Total | 8,591 | 7,659 | 382 | 379 |
These financial statements are referred to as a general purpose financial report which has been prepared in accordance with Australian Accounting Standards (AAS) and Interpretations and other mandatory requirements. AASs include Australian equivalents to the International Financial Reporting Standards.
The financial statements have also been prepared in accordance with the relevant requirements of the Health Practitioner Regulation National Law Act 2009.
For the purpose of preparing the financial statements, it is a not-for-profit entity.
These financial statements were authorised to be issued by the Agency Management Committee on 26 August 2016.
AHPRA is the organisation responsible for the administration of the National Registration and Accreditation Scheme across Australia.
AHPRA’s operations are governed by the Health Practitioner Regulation National Law Act 2009 as in force in each state and territory, which came into effect on 1 July 2010 and on 18 October 2010 in Western Australia. This law means that registered health professions are regulated by nationally consistent legislation.
AHPRA supports the National Health Practitioner Boards in the administration of the National Registration and Accreditation Scheme. National Boards are responsible for regulating their respective health professions. The primary role of the National Boards is to protect the public and set standards and policies that all registered health practitioners must meet.
The Agency Management Committee oversees the work of AHPRA. The Chair of the Agency Management Committee is Mr Michael Gorton. The Chief Executive Officer is Mr Martin Fletcher.
The financial statements include the controlled activities of AHPRA.
AHPRA’s corporate address is 111 Bourke Street, Melbourne 3000.
Accounting policies are selected and applied in preparing the financial statements for the year ended 30 June 2016 in a manner which ensures that the resulting financial information satisfies the concepts of relevance and reliability, thereby ensuring that the substance of the underlying transactions or other events is appropriately reported.
The financial statements have been prepared using the accrual basis of accounting. Under the accrual basis, items are recognised as assets, liabilities, equity, income or expenses when they satisfy the definition and recognition criteria for those items, that is they are recognised in the reporting period to which they relate.
The financial report is prepared in accordance with the historical cost convention.
The estimates and underlying assumptions used in preparing these financial statements are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised and also in future periods that are affected by the revision. Judgements and assumptions made by management in the application of AASs that have significant effects on the financial statements and estimates relate to:
AHPRA is a statutory body governed by the Health Practitioner Regulation National Law Act 2009 as in force in each state and territory (the National Law).
Prepaid expenditure is recognised when payments are made in advance of receipt of goods or services or expenditure made in one accounting period that covers a term extending beyond that period. It is then recognised as expenditure to the period in which the service relates.
All application, registration and late fees are exempt from GST legislation. Income, expenses and assets are recognised net of GST except where the amount of GST incurred is not recoverable, in which case it is recognised as part of the cost of acquisition of an asset or part of an item of expense or revenue. GST receivable from or payable to the Australian Taxation Office (ATO) is included in the statement of financial position. The GST component of a receipt or payment is recognised on a gross basis in the cash flow statement in accordance with AASB 107 Statement of Cash Flows.
Tax effect accounting has not been applied as AHPRA is exempt from income tax under section 50-25 of the Income Tax Assessment Act 1997.
All amounts specified in these statements are presented in Australian dollars.
Amounts in the financial statements have been rounded to the nearest thousand dollars unless otherwise stated Figures in the financial statements may not equate due to rounding.
Subsequent to the 2014/15 reporting period, no new and revised AASs or AHPRA accounting policies have been adopted in the current period.
Certain new Australian accounting standards and interpretations that are not mandatory for the 30 June 2016 reporting period have been published.
As at 30 June 2016, the following standards and interpretations had been issued but were not mandatory for the financial year ended 30 June 2016. AHPRA has not adopted, and does not intend to adopt, these standards early.
AASB 108 requires disclosure of the impact on AHPRA’s financial statements of these changes. These are set out below.
| Standard/ interpretation | Summary | Applicable for annual reporting periods beginning on | Impact on AHPRA financial statements |
|---|---|---|---|
| AASB 9 Financial instruments | The key changes include the simplified requirements for the classification and measurement of financial assets, a new hedging accounting model, and a revised impairment loss model to recognise impairment losses earlier, as opposed to the current approach that recognises impairment only when incurred. | 1 January 2018 | While the preliminary assessment has not identified any material impact arising from AASB 9, it will continue to be monitored and assessed. |
| AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) | The requirements for classifying and measuring financial liabilities were added to AASB 9. The existing requirements for the classification of financial liabilities and the ability to use the fair value option have been retained. However, where the fair value option is used for financial liabilities the change in fair value is accounted for as follows: The change in fair value attributable to changes in credit risk is presented in other comprehensive income (OCI); and - Other fair value changes are presented in profit and loss. If this approach creates or enlarges an accounting mismatch in the profit or loss, the effect of the changes in credit risk are also presented in profit or loss. | 1 January 2018 | The assessment has identified that the amendments are likely to result in earlier recognition of impairment losses and at more regular intervals. |
| AASB 2014-7 Amendments to Australian Accounting Standards arising from AASB 9 | Amends various AASs to incorporate the consequential amendments arising from the issuance of AASB 9. | 1 January 2018 | The assessment has indicated that there will be no significant impact for the public sector. |
| AASB 15 Revenue from contracts with customers | The core principle of AASB 15 requires an entity to recognise revenue when the entity satisfies a performance obligation by transferring a promised good or service to a customer. | 1 January 2018 | The changes in revenue recognition requirements in AASB 15 may result in changes to the timing and amount of revenue recorded in the financial statements. A potential impact will be the upfront recognition of revenue from registrations that cover multiple reporting periods. Revenue that was deferred and amortised over a period may now need to be recognised immediately as a transitional adjustment against the opening accumulated surplus if there are no former performance obligations outstanding. |
| AASB 2015-8 Amendments to Australian Accounting Standards - Effective Date of AASB 15 | This standard defers the mandatory effective date of AASB 15 from 1 January 2017 to 1 January 2018. | 1 January 2018 | This amending standard will defer the application period of AASB 15 to the 2018/19 reporting period in accordance with the transition requirements. |
| AASB 2016-3 Amendments to Australian Accounting Standards - Clarifications to AASB 15 | This standard amends AASB 15 to clarify the requirements on identifying performance obligations, principal versus agent considerations and the timing of recognising revenue from granting a licence. The amendments require: A promise to transfer to a customer a good or service that is 'distinct' to be recognised as a separate performance obligation; For items purchased online, the entity is a principal if it obtains control of the good or service prior to transferring to the customer; and For licences identified as being distinct from other goods or services in a contract, entities need to determine whether the licence transfers to the customer over time (right to use) or at a point in time (right to access). | 1 January 2018 | The impact will be the same as identifed in AASB 15. |
| AASB 2014‑1 Amendments to Australian Accounting Standards [Part E financial instruments] | Amends various AASs to reflect the AASB's decision to defer the mandatory application date of AASB 9 to annual reporting periods beginning on or after 1 January 2018 as a consequence of Chapter 6 Hedge accounting, and to amend reduced disclosure requirements. | 1 January 2018 | This amended standard will defer the application period of AASB 9 to the 2018/19 reporting period in accordance with the transition requirements. |
| AASB 2014‑4 Amendments to Australian Accounting Standards - Clarification of acceptable methods of depreciation and amortisation | Amends AASB 116 Property, plant and equipment and AASB 138 Intangible assets to: establish the principle for the basis of depreciation and amortisation as being the expected pattern of consumption of the future economic benefits of an asset; prohibit the use of revenue‑based methods to calculate the depreciation or amortisation of an asset, tangible or intangible, because revenue generally reflects the pattern of economic benefits that are generated from operating the business, rather than the consumption through the use of the asset. | 1 January 2016 | The assessment has indicated that there is no expected impact as the revenue-based method is not used for depreciation and amortisation. |
| AASB 16 Leases | The key changes introduced by AASB 16 include the recognition of most operating leases (which are currently not recognised) on the balance sheet. | 1 January 2019 | The assessment has indicated that as most operating leases will come on balance sheet, recognition of lease assets and lease liabilities will cause net debt to increase. Depreciation of lease assets and interest on lease liabilities will be recognised in the income statement with marginal impact on the operating surplus. The amounts of cash paid for the principal portion of the lease liability will be presented within financing activities and the amounts paid for the interest portion will be presented within operating activities in the cash flow statement. |
Financial instruments arise out of contractual agreements that give rise to a financial asset of one entity and a financial liability or equity instrument of another entity. Due to the nature of AHPRA’s activities, certain financial assets and financial liabilities arise under statute rather than contract. Such financial assets and financial liabilities do not meet the definition of financial instruments in AASB 132 Financial Instruments: Presentation.
Where relevant, for note disclosure purposes, a distinction is made between those financial assets and financial liabilities that meet the definition of financial instruments in accordance with AASB 132 and those that do not.
Categories of financial instruments include:
Receivables are financial instrument assets with fixed and determinable payments that are not quoted on an active market. These assets are initially recognised at fair value plus any directly attributable transaction costs. Subsequent to initial measurement, receivables are measured at amortised cost using the effective interest method, less any impairment.
Contractual receivables are classified as financial instruments and categorised as receivables. Statutory receivables are recognised and measured similarly to contractual receivables (except for impairment), but are not classified as financial instruments because they do not arise from a contract.
The receivables category includes cash and deposits (refer to Note C1), term deposits with maturity greater than three months, trade receivables and other receivables, but not statutory receivables such as GST.
At the end of each reporting period, AHPRA assesses whether there is objective evidence that a financial asset or group of financial assets is impaired. All financial instrument assets are subject to annual review for impairment. Any impairment loss is recognised in the statement of comprehensive income.
Financial instrument liabilities are initially recognised on the date they originate. They are initially measured at fair value plus any directly attributable transaction costs. Subsequent to initial recognition, these liabilities are measured at amortised cost with any difference between the initial recognised amount and the redemption value being recognised in income statement over the period of the interest bearing liability, using the effective interest rate method.
Financial instrument liabilities measured at amortised cost include all of AHPRA’s contractual payables.
AHPRA’s principal financial instruments consist of at call variable interest deposits, fixed and repricing term deposits and trade receivables and payables. AHPRA has no exposure to foreign exchange rate risk.
Credit risk is the risk that a party will fail to fulfil its obligations to AHPRA resulting in financial loss. The maximum exposure to credit risk, excluding the value of any collateral or other security at balance date, is the carrying amount, net of any provisions for impairment of those assets, as disclosed in the statement of financial position and notes to the financial statements. AHPRA does not have any material credit risk exposure to any single receivable or group of receivables under financial instruments entered into by the entity.
There are no material amounts of collateral held as security at 30 June 2016 (2015: $Nil).
Credit risk is managed by the entity and reviewed regularly. It arises from exposures to debtors as well as through deposits with major financial institutions.
AHPRA monitors the credit risk by actively assessing the rating quality and liquidity of counterparties.
| 2016 Financial assets | Financial institutions (*AA- credit rating) $ '000 | Other $ '000 | Total $ '000 |
|---|---|---|---|
| Cash and cash equivalents | 3,421 | 0 | 3,421 |
| Investments | 171,000 | 0 | 171,000 |
| Receivables | 0 | 574 | 574 |
| Total | 174,421 | 574 | 174,995 |
| 2015 Financial assets | Financial institutions (*AA- credit rating) $ '000 | Other $ '000 | Total $ '000 |
|---|---|---|---|
| Cash and cash equivalents | 6,217 | 0 | 6,217 |
| Investments | 161,000 | 0 | 161,000 |
| Receivables | 0 | 548 | 548 |
| Total | 167,217 | 548 | 167,765 |
| 2016 Financial assets | Carrying amount $ '000 | Not past due and not impaired $ '000 | Past due but not impaired Less than 1 month $ '000 | Past due but not impaired 1 - 3 months $ '000 | Past due but not impaired 3 - 12 months $ '000 $ '000 | More than 1 year $ '000 | Impaired financial assets $ '000 |
|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | 3,421 | 3,421 | 0 | 0 | 0 | 0 | 0 |
| Investments | 171,000 | 0 | 0 | 15,000 | 37,000 | 119,000 | 0 |
| Receivables | 1,255 | 288 | 6 | 13 | 442 | 506 | (681) |
| Accrued income | 2,414 | 2,414 | 0 | 0 | 0 | 0 | 0 |
| Total | 178,090 | 6,123 | 6 | 15,013 | 37,442 | 119,506 | (681) |
| Financial assets 2015 | Carrying amount $ '000 | Not past due and not impaired $ '000 | Past due but not impaired Less than 1 month $ '000 | Past due but not impaired 1 - 3 months $ '000 | Past due but not impaired 3 - 12 months $ '000 | More than 1 year $ '000 | Impaired financial assets $ '000 |
|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | 6,217 | 6,217 | 0 | 0 | 0 | 0 | 0 |
| Investments | 161,000 | 0 | 0 | 35,000 | 55,000 | 71,000 | 0 |
| Receivables | 859 | 136 | 123 | 66 | 31 | 503 | (311) |
| Accrued income | 2,728 | 2,728 | 0 | 0 | 0 | 0 | 0 |
| Total | 170,804 | 9,081 | 123 | 35,066 | 55,031 | 71,503 | (311) |
Note:
Fitch Ratings and Standard & Poor’s both rate AAMoody’s Investors Service rate Aa2
Liquidity risk is the risk that AHPRA will encounter difficulty in meeting obligations associated with financial liabilities. AHPRA manages liquidity risk by monitoring cash flows’ forecast and ensuring that adequate liquid funds are available to meet current obligations.
| Payables 2016 | Maturity dates - Carrying amount $ '000 | Maturity dates - Less than 1 month $ '000 | Maturity dates - 1-3 months $ '000 | Maturity dates - 3 months -1 year $ '000 |
|---|---|---|---|---|
| Trade creditors | 1,885 | 1,701 | 153 | 31 |
| Accrued expenses | 7,800 | 7,800 | 0 | 0 |
| Total | 9,685 | 9,501 | 153 | 31 |
| Payables 2015 | Maturity dates - Carrying amount $ '000 | Maturity dates - Less than 1 month $ '000 | Maturity dates - 1-3 months $ '000 | Maturity dates - 3 months -1 year $ '000 |
|---|---|---|---|---|
| Trade creditors | 2,130 | 2,064 | 41 | 25 |
| Accrued expenses | 9,784 | 9,784 | 0 | 0 |
| Total | 11,914 | 11,848 | 41 | 25 |
The maximum exposure to liquidity risk is the total carrying amount of the financial liabilities as shown above.
AHPRA has no exposure to currency risk at 30 June 2016 or at 30 June 2015.
AHPRA has no exposure to equity price risk at 30 June 2016 or at 30 June 2015.
Exposure to interest rate risk is limited to assets bearing variable interest rates. AHPRA has a combination of deposits with floating and fixed interest rates. Exposure to variable interest rate risk is with financial institutions with *AA- credit rating.
| Financial assets 2016 | Weighted average interest rate | Non- interest bearing $'000 | Floating interest rate $'000 | Fixed interest rate $'000 | Total $'000 |
|---|---|---|---|---|---|
| Cash and cash equivalents | 1.75% | 0 | 0 | 3,421 | 3,421 |
| Investments | 3.14% | 0 | 72,000 | 99,000 | 171,000 |
| Receivables | 0.00% | 574 | 0 | 0 | 574 |
| Total | 574 | 72,000 | 102,421 | 174,995 |
| Financial liabilities 2016 | Weighted average interest rate | Non- interest bearing $'000 | Floating interest rate $'000 | Fixed interest rate $'000 | Total $'000 |
|---|---|---|---|---|---|
| Payables | 0.00% | 1,885 | 0 | 0 | 1,885 |
| Accrued expenses | 0.00% | 7,800 | 0 | 0 | 7,800 |
| Total | 9,685 | 0 | 0 | 9,685 |
| Financial assets 2015 | Weighted average interest rate | Non- interest bearing $'000 | Floating interest rate $'000 | Fixed interest rate $'000 | Total $'000 |
|---|---|---|---|---|---|
| Cash and cash equivalents | 2.00% | 0 | 6,217 | 0 | 6,217 |
| Investments | 3.59% | 0 | 3,000 | 158,000 | 161,000 |
| Receivables | 0.00% | 548 | 0 | 0 | 548 |
| Total | 548 | 9,217 | 158,000 | 167,765 |
| Financial liabilities 2015 | Weighted average interest rate | Non- interest bearing $'000 | Floating interest rate $'000 | Fixed interest rate $'000 | Total $'000 |
|---|---|---|---|---|---|
| Payables | 0.00% | 2,130 | 0 | 0 | 2,130 |
| Accrued expenses | 0.00% | 9,784 | 0 | 0 | 9,784 |
| Total | 11,914 | 0 | 0 | 11,914 |
Note:
Fitch Ratings and Standard & Poor’s both rate AAMoody’s Investors Service rate Aa2
Taking into account past performance, future expectations, economic forecasts, and management’s knowledge and experience of the financial markets, AHPRA believes the following movements are ‘reasonably possible’ over the next 12 months:
The following table discloses the impact on net operating result and equity for each category of financial instrument held by AHPRA at year end as presented to key management personnel, if changes in the market interest rates occur.
| Financial assets 2016 | Carrying amount $'000 | At -1.0% $'000 Surplus | At -1.0% $'000 Equity | At +0.5% $'000 Surplus | At +0.5% $'000 Equity |
|---|---|---|---|---|---|
| Cash and cash equivalents | 3,421 | (34) | (34) | 17 | 17 |
| Investments | 171,000 | (752) | (752) | 376 | 376 |
| Receivables | 1,255 | 0 | 0 | 0 | 0 |
| Financial liabilities 2016 | |||||
| Payables | 1,885 | 0 | 0 | 0 | 0 |
| Accruals | 7,800 | 0 | 0 | 0 | 0 |
| Total | (786) | (786) | 393 | 393 |
| Financial assets 2015 | Carrying amount $'000 | At -1.0% $'000 Surplus | At -1.0% $'000 Equity | At +0.5% $'000 Surplus | At +0.5% $'000 Equity |
|---|---|---|---|---|---|
| Cash and cash equivalents | 6,217 | (62) | (62) | 31 | 31 |
| Investments | 161,000 | (558) | (558) | 279 | 279 |
| Receivables | 859 | 0 | 0 | 0 | 0 |
| Financial liabilities 2015 | |||||
| Payables | 2,130 | 0 | 0 | 0 | 0 |
| Accruals | 9,784 | 0 | 0 | 0 | 0 |
| Total | (620) | (620) | 310 | 310 |
AHPRA has no exposure to other market risk at 30 June 2016 or at 30 June 2015.
The fair values and net fair values of financial instrument assets and liabilities are determined as follows:
AHPRA considers that the carrying amount of financial instrument assets and liabilities recorded in the financial statements to be a fair approximation of their fair values, because of the short-term nature of the financial instruments and the expectation that they will be settled in full.
The following table shows that the fair values of the contractual financial assets and liabilities are the same as the carrying amounts.
| Contractual financial assets | Carrying amount 2016 $'000 | Fair value 2016 $'000 | Carrying amount 2015 $'000 | Fair value 2015 $'000 |
|---|---|---|---|---|
| Cash and cash equivalents | 3,421 | 3,421 | 6,217 | 6,217 |
| Investments | 171,000 | 171,000 | 161,000 | 161,000 |
| Receivables | 1,255 | 574 | 859 | 548 |
| Accrued income | 2,414 | 2,414 | 2,728 | 2,728 |
| Total contractual financial assets | 178,090 | 177,409 | 170,804 | 170,493 |
| Contractual financial liabilities | Carrying amount 2016 $'000 | Fair value 2016 $'000 | Carrying amount 2015 $'000 | Fair value 2015 $'000 |
|---|---|---|---|---|
| Payables | 1,885 | 1,885 | 2,130 | 2,130 |
| Accrued expenses | 7,800 | 7,800 | 9,784 | 9,784 |
| Total contractual financial liabilities | 9,685 | 9,685 | 11,914 | 11,914 |
The Ministerial Council comprises Ministers of the governments of the participating jurisdictions and the Commonwealth with portfolio responsibility for health. The following Ministers were members of the Australian Health Workforce Ministerial Council during the year 1 July 2015 to 30 June 2016, unless otherwise noted.
| Name | Portfolio | Jurisdiction |
|---|---|---|
| The Hon Sussan Ley MP | Minister for Health and Aged Care (from 30 September 2015), Minister for Sport, Minister for Health (to 29 September 2015) | Commonwealth |
| The Hon Jillian Skinner MP | Minister for Health | New South Wales |
| The Hon Jill Hennessey MP | Minister for Health, Minister for Ambulance Services, Chair, Australian Health Workforce Ministerial Council, (from May 2016) | Victoria |
| The Hon Cameron Dick MP | Minister for Health, Minister for Ambulance Services | Queensland |
| The Hon Jack Snelling MP | Minister for Health, Minister for the Arts, Minister for Health Industries, Minister for Mental Health and Substance Abuse (to 19 January 2016), Chair, Australian Health Workforce Ministerial Council (ended April 2016) | South Australia |
| The Hon Michael Ferguson MLA | Premier, Minister for Health, Minister for Information Technology and Innovation | Tasmania |
| The Hon Dr Kim Hames MLA (to 31 March 2016) | Minister for Health; Tourism (16 February 2016 to 31 March 2016), Deputy Premier, Minister for Health, Minister for Tourism (to 16 February 2016) | Western Australia |
| The Hon John Day MLA (from April 2016) | Minister for Health, Minister for Culture and the Arts | Western Australia |
| Mr. Simon Corbell MLA | Minister for Health, Deputy Chief Minister, Attorney-General, Minister for the Environment and Climate Change, Minster for Police and Emergency Services, Minister for Capital Metro | Australian Capital Territory |
| Hon Johan (John) Wessel Elferink MLA | Attorney-General and Minister for Justice, Minister for Children and Families, Minister for Health, Minister for Disability Services, Minister for Mental Health Services, Minister for Correctional Services | Northern Territory |
Amounts relating to responsible ministers are reported in the financial statements of the relevant minister’s jurisdiction.
| Member | Period |
|---|---|
| Mr Michael Gorton AM | 1/07/15 - 30/06/16 |
| Ms Karen Crawshaw PSM | 1/07/15 - 30/06/16 |
| Professor Con Michael AO | 1/07/15 - 03/09/15 |
| Professor Merrilyn Walton AM | 1/07/15 - 30/06/16 |
| Mr Ian Smith PSM | 1/07/15 - 30/06/16 |
| Ms Jenny Taing | 1/07/15 - 30/06/16 |
| Mr David Taylor | 1/07/15 - 30/06/16 |
| Ms Barbara Yeoh | 1/07/15 - 30/06/16 |
| Dr Peggy Brown | 29/02/16 - 30/06/16 |
| 2016 $'000 | 2015 $'000 | |
|---|---|---|
| Victorian Auditor-General's Office | 155 | 151 |
| 155 | 151 |
The Health Practitioner Regulation National Law (NSW) No. 86a and the Queensland Health Ombudsman Act 2013 allow for coregulation of registered health practitioners at the discretion of the respective member jurisdictions. Both New South Wales (NSW) and Queensland (QLD) have determined that co-regulation applies.
In NSW, the Health Minister informs AHPRA and the National Boards of the amount to be collected per registrant on behalf of the NSW Health Professional Councils Authority (HPCA), for the purpose of handling notifications related to NSW-based practitioners. AHPRA collects these amounts and passes them on to the various Health Profession Councils, via HPCA. As this amount is set per registrant and collected by AHPRA and remitted to the HPCA within seven days of the end of the month, it is treated as an administered item in these financial statements. These amounts are not recorded within the statement of comprehensive income or statement of financial position.
Transactions relating to this activity are reported as administered (non-controlled) items as per the table below:
| ATSIHPBA $'000 | CMBA $'000 | ChiroBA $'000 | DBA $'000 | MBA $'000 | MRPBA $'000 | NMBA $'000 | OTBA $'000 | OptomBA $'000 | OsteoBA $'000 | PharmBA $'000 | PhysioBA $'000 | PodBA $'000 | PsyBA $'000 | Total $'000 | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| 2014/15 | 2 | 548 | 187 | 2,318 | 12,311 | 489 | 7,565 | 255 | 186 | 169 | 1,719 | 531 | 240 | 1,161 | 27,682 |
| 2015/16 | 4 | 477 | 195 | 2,385 | 12,997 | 393 | 7,828 | 218 | 196 | 194 | 1,778 | 563 | 277 | 1,228 | 28,733 |
In Queensland, the Health Minister informs AHPRA and the National Boards of the amount to be paid to the Office of the Health Ombudsman (Queensland). This payment is included in the statement of comprehensive income as an expense. In 2015/16, AHPRA paid $4.2 million to the Office of the Health Ombudsman (Queensland) under these arrangements (2014/15: $4.5 million). The breakdown of the payment is shown in the table below:
| National Board | 2016 $'000 | 2015 $'000 |
|---|---|---|
| ATSIHPBA | 0 | 0 |
| CMBA | 37 | 12 |
| ChiroBA | 30 | 38 |
| DBA | 253 | 502 |
| MBA | 2,032 | 2,008 |
| MRPBA | 26 | 13 |
| NMBA | 1,300 | 1,198 |
| OTBA | 13 | 48 |
| OptomBA | 16 | 9 |
| OsteoBA | 7 | 1 |
| PharmBA | 244 | 428 |
| PhysioBA | 47 | 41 |
| PodBA | 10 | 17 |
| PsyBA | 187 | 186 |
| Total | 4,202 | 4,500 |
| Abbreviations | National Board |
|---|---|
| ATSIHPBA | Aboriginal and Torres Strait Islander Health Practice Board of Australia |
| CMBA | Chinese Medicine Board of Australia |
| ChiroBA | Chiropractic Board of Australia |
| DBA | Dental Board of Australia |
| MBA | Medical Board of Australia |
| MRPBA | Medical Radiation Practice Board of Australia |
| NMBA | Nursing and Midwifery Board of Australia |
| OTBA | Occupational Therapy Board of Australia |
| OptomBA | Optometry Board of Australia |
| OsteoBA | Osteopathy Board of Australia |
| PharmBA | Pharmacy Board of Australia |
| PhysioBA | Physiotherapy Board of Australia |
| PodBA | Podiatry Board of Australia |
| PsyBA | Psychology Board of Australia |
I have audited the accompanying financial report for the year ended 30 June 2016 of the Australian Health Practitioner Regulation Authority which comprises the statement of comprehensive income, statement of financial position, statement of changes in equity, statement of cash flows, notes comprising a summary of significant accounting policies and other explanatory information, and the declaration by chair, agency management committee, chief executive officer, executive director, business services and chief financial officer.
The Agency Management Committee of the Australian Health Practitioner Regulation Authority is responsible for the preparation and fair presentation of the financial report in accordance with Australian Accounting Standards, and the financial reporting requirements of the Health Practitioner Regulation National Law Act 2009, and for such internal control as the Agency Management Committee determine is necessary to enable the preparation and fair presentation of the financial report that is free from material misstatement. whether due to fraud or error.
As required by the Audit Act 1994, my responsibility is to express an opinion on the financial report based on the audit, which has been conducted in accordance with Australian Auditing Standards. Those standards require compliance with relevant ethical requirements relating to audit engagements and that the audit be planned and performed to obtain reasonable assurance about whether the financial report is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The audit procedures selected depend on judgement, including the assessment of the risks of material misstatement of the financial report, whether due to fraud or error. In making those risk assessments. consideration is given to the internal control relevant to the entity's preparation and fair presentation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of the accounting policies used and the reasonableness of accounting estimates made by the Agency Management Committee, as well as evaluating the overall presentation of the financial report.
I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.
The Auditor-General's independence is established by the Constitution Act 1975. The Auditor-General is not subject to direction by any person about the way in which his powers and responsibilities are to be exercised. In conducting the audit, I and my staff and delegates have complied with the applicable independence requirements of the Australian Auditing Standards and relevant ethical pronouncements.
In my opinion, the financial report presents fairly, in all material respects, the financial position of the Australian Health Practitioner Regulation Authority as at 30 June 2016 and its financial performance and its cash flows for the year then ended in accordance with applicable Australian Accounting Standards, and the financial reporting requirements of the Health Practitioner Regulation National Law Act 2009.
Dr. Peter Frost
Acting Auditor-General
MELBOURNE
30 August 2016