Annual Report 2010/2011 - Part 2: Financial Statements

Statement of Comprehensive income
for the year ended 30 June 2011

Actual 2010 $ 000		Note	Actual 2011 $ 000	Main Estimates 2011 $ 000	Supplementary Estimates 2011 $ 000
	Income
26,776	Revenue Crown		36,004	46,072	36,004
563	Revenue Department		546	590	590
41,315	Revenue other	2	41,486	52,390	43,433
-	Gains	3	14	-	-
68,654	Total income		78,050	99,052	80,027
	Expenditure
30,320	Personnel costs	4	33,815	37,379	33,422
2,549	Depreciation and amortisation expense	9,10	2,834	4,866	2,929
1,295	Capital charge	5	1,323	1,501	1,323
11	Finance costs	6	11	-	12
131	Net loss on disposal of property, plant and equipment		-	-	-
28,333	Other operating expenses	7	32,791	49,666	46,863
62,639	Total expenditure		70,774	93,412	84,549
6,015	Net surplus/(deficit)		7,276	5,640	(4,522)
6,015	Total comprehensive income		7,276	5,640	(4,522)

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Statement of changes in taxpayers' funds
for the year ended 30 June 2011

Actual 2010 $ 000		Note	Actual 2011 $ 000	Main Estimates 2011 $ 000	Supplementary Estimates 2011 $ 000
17,272	Balance as at 1 July		17,645	17,897	17,645
6,015	Total comprehensive income		7,276	5,640	(4,522)
(8,331)	Repayment of surplus to the Crown	12	(10,437)	(9,915)	4,522
2,064	Capital contributions to fund memorandum account deficits		-	6,100	-
625	Capital contributions for fixed assets		1,825	-	1,825
17,645	Taxpayers’ funds as at 30 June		16,309	19,722	19,470

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Statement of financial position
as at 30 June 2011

Actual 2010 $ 000		Note	Actual 2011 $ 000	Main Estimates 2011 $ 000	Supplementary Estimates 2011 $ 000
	Assets
	Current assets
686	Cash and cash equivalents		11,023	9,597	3,281
21,022	Debtors and other receivables	8	15,521	16,000	9,000
82	Prepayments		265	133	82
21,790	Total current assets		26,809	25,730	12,363
	Non-current assets
5,756	Property, plant and equipment	9	4,687	5,446	4,618
7,944	Intangible assets	10	7,287	10,533	7,415
13,700	Total non-current assets		11,974	15,979	12,033
35,490	Total assets		38,783	41,709	24,396
	Liabilities
	Current liabilities
6,935	Creditors and other payables	11	8,866	9,217	6,934
8,331	Repayment of surplus	12	10,437	9,915	(4,522)
10	Provisions	13	315	10	10
1,711	Employee entitlements	14	1,854	1,600	1,712
198	Finance leases	15	198	198	198
17,185	Total current liabilities		21,670	20,940	4,332
	Non-current liabilities
29	Provisions	13	258	40	29
86	Employee entitlements	14	199	500	86
545	Finance leases	15	347	507	479
660	Total non-current liabilities		804	1,047	594
17,845	Total liabilities		22,474	21,987	4,926
17,645	Net assets		16,309	19,722	19,470
	Taxpayers' funds
17,645	General funds		16,309	19,722	19,470
17,645	Total taxpayers' funds		16,309	19,722	19,470

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Statement of Cash Flows
for the year ended 30 June 2011

Actual 2010 $ 000		Note	Actual 2011 $ 000	Main Estimates 2011 $ 000	Supplementary Estimates 2011 $ 000
	Cash flows from operating activities
26,775	Receipts from Crown		36,004	46,072	36,004
46,920	Receipts from revenue other		46,058	53,283	53,981
(29,096)	Payments to suppliers		(30,033)	(50,240)	(46,941)
(30,903)	Payments to employees		(34,121)	(36,837)	(33,422)
(1,295)	Payments for capital charge		(1,323)	(1,501)	(1,323)
123	Goods and Services Tax (net)		(445)	-	-
12,524	Net cash from operating activities	16	16,140	10,777	8,299
	Cash flows from investing activities
26	Receipts from sale of property, plant and equipment		35	-	-
(307)	Purchase of property, plant and equipment		(369)	(1,079)	(395)
(5,549)	Purchase of intangible assets		(831)	(5,424)	(867)
(5,830)	Net cash from investing activities		(1,165)	(6,503)	(1,262)
	Cash flows from financing activities
625	Capital contribution		3,889	6,100	3,889
(8,558)	Repayment of surplus		(8,329)	(6,038)	(8,331)
(198)	Payment of finance leases		(198)	-	-
(8,131)	Net cash from financing activities		(4,638)	62	(4,442)
(1,437)	Net (decrease)/increase in cash		10,337	4,336	2,595
2,123	Cash at the beginning of the year		686	5,261	686
686	Cash at the end of the year		11,023	9,597	3,281

The GST (net) component of operating activities reflects the net GST paid and received with the Inland Revenue Department. The GST (net) component has been presented on a net basis, a) as the gross amounts do not provide meaningful information for financial statement purposes, and b) to be consistent with the presentation basis of the other primary financial statements. 

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Statement of commitments
as at 30 June 2011

Non-cancellable operating lease commitments

The Department leases property and equipment in the normal course of its business. The majority of these leases are for premises, telecommunications equipment and photocopiers, which have a non-cancellable leasing period ranging from one to ten years.

Actual 2010 $ 000		Actual 2011 $ 000
	Non-cancellable operating lease commitments
2,821	Not later than one year	3,165
9,900	Later than one year and not later than five years	8,016
1,587	Later than five years	978
14,308	Total non-cancellable operating lease commitments	12,159

Capital commitments

As at 30 June 2011 there were no capital commitments (2010: nil).

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Statement of contingent liabilities and contingent assets
as at 30 June 2011

Quantifiable contingent liabilities

The Department has been named as a defendant in a claim before the Weathertight Homes Tribunal. The claim of $390,000 against the Department is based on an allegation that a contracted assessor who assessed a leaky home in 2003 carried out the work negligently, failed to notice damage and, as a result, this damage was not repaired and became worse over time. This was a contingent liability at 30 June 2011 and was also a contingent liability last year.

There were three judicial reviews at 30 June 2011 totalling $45,000 relating to the Weathertight Homes Resolution Service with a potential for costs to be awarded against the Department.

Actual 2010 $ 000		Actual 2011 $ 000
	Quantifiable contingent liabilities
390	Legal proceedings and disputes	435
390	Total contingent liabilities	435

The accompanying notes form part of the financial statements.

Unquantifiable contingent liabilities

The Department has given indemnities in relation to the Canterbury earthquake building performance Technical Investigation to the four consultants carrying out the investigations and the 12 members of the experts' panel (including one member representing each consultant). The indemnities cover costs from claims by third parties against the contractors or their staff in relation to the reports produced, as well as media releases made by the experts' panel Chair. There is no stated limit on the amount of each indemnity. The indemnities are only available if the contractor has complied with its obligations under its contract.

Contingent assets

The Department had no contingent assets as at 30 June 2011 (2010: nil).

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Statement of Department expenditure and capital expenditure against appropriations
for the year ended 30 June 2011

Expenditure after remeasurements 2010 $ 000		Expenditure after remeasurements 2011 $ 000	Appropriation Voted 2011* $ 000
	Vote Housing
	Annual output expense appropriations
15,368	Building Regulation and Control	-	-
7,596	Occupational Licensing	-	-
1,308	Performance Monitoring and Advice – Housing New Zealand Corporation	568	641
21,302	Residential Tenancy and Unit Title Services	-	-
4,446	Sector and Regulatory Policy	6,215	6,888
12,619	Weathertight Services**	16,674	25,559
-	Canterbury Earthquakes: Arranging and Managing Emergency and Temporary Accommodation	1,559	2,207
62,639	Total annual output expense appropriations	25,016	35,295
	Multi-year year appropriations (after first of three years)
-	Building Regulation and Control	16,111	18,046
-	Occupational Licensing	8,701	8,984
-	Residential Tenancy & Unit Title Services	20,946	21,524
-	Total multi-year output expense appropriations	45,758	48,554
62,639	Total output expense appropriations	70,774	83,849
	Annual appropriation for capital expenditure
4,970	Department of Building and Housing - Capital Expenditure PLA	1,113	1,262
4,970	Total appropriation for capital expenditure	1,113	1,262

There were no remeasurements during the year.

* This includes adjustments made in the Supplementary Estimates.

** During the year fundsappropriated under "Weathertight Homes Resolution Services" were transferred to a new appropriation entitled "Weathertight Services". The statement above matches the figures for the previous and current appropriations for comparative purposes.

Reconciliation of multi-year appropriations 2011 - Appropriation, adjustment and use	$ 000
Building Regulation and Control
Original appropriation	46,898
Adjustments for 2010/11	2,965
Total adjusted appropriation	49,863
Actual expenses to 2010/11 year end	(16,111)
Balance of appropriation	33,752
Occupational Licensing
Original appropriation	27,341
Adjustments for 2010/11	-
Total adjusted appropriation	27,341
Actual expenses to 2010/11 year end	(8,701)
Balance of appropriation	18,640
Residential Tenancy and Unit Titles Services
Original appropriation	66,550
Adjustments for 2010/11	830
Total adjusted appropriation	67,380
Actual expenses to 2010/11 year end	(20,946)
Balance of appropriation	46,434

Statement of unappropriated expenditure
For the year ended 30 June 2011

The Department of Building and Housing had no instances of unappropriated expenditure for the year ended 30 June 2011 (2010: nil).

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Statement of trust monies
as at 30 June 2011

The Department of Building and Housing operates trust accounts under section 66 of the Public Finance Act 1989. The transactions through these accounts and their balances at 30 June 2011 are not included in the Department's own financial statements. Movements in these accounts during the year ended 30 June 2011 (as reported to the Treasury) were as follows:

	Opening Balance 1 July 2010 $ 000	Distributions Made $ 000	Capital Increase $ 000	Closing Balance 30 June 2011 $ 000
Trust Accounts
Certifiers Bond Trust Account	192	(5)	5	192
Residential Tenancies Trust Account	314,475	(142,935)	170,469	342,009

Certifiers Bond Trust Account

This account holds in trust deposits received from certifiers of building consents.

Residential Tenancies Trust Account

This account holds all sums paid by way of a bond in respect of any tenancy pursuant to the Residential Tenancies Act 1986.

A full set of audited financial statements for the Residential Tenancies Trust Account, prepared on an accrual accounting basis in conformity with generally accepted accounting practice, is provided on pages 90 to 96.

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