Appendix 1: Budget portfolio outcomes

The budget portfolio outcomes statements provide a comparison between the actual financial information of all general government entities within the portfolio and the forecast financial information published in the State Budget Papers by the Department of Treasury and Finance.

The budget portfolio outcomes statements comprise the comprehensive operating statement, balance sheet, cash flow statement, statement of changes in equity and the administered items statement.

The budget portfolio outcomes statements have been prepared on a consolidated basis and include all general government entities within the portfolio. Consistent with the budget papers, financial transactions and balances are classified into either ‘controlled’ or ‘administered’.

The budget portfolio outcomes statements that follow are not subject to audit by the Victorian Auditor-General’s Office.

They are not prepared on the same basis as the Department of Premier and Cabinet’s (DPC) financial statements because they also include the consolidated financial information of the following entities:

Victorian Electoral Commission
Victorian Public Sector Commission.

Comprehensive operating statement for the year ending 30 June 2023

Controlled	2022–23 actual $m	2022–23 budget $m	Variation $m
Income from transactions
Output appropriations⁽¹⁾	563.0	490.2	72.8
Special appropriations⁽²⁾	141.2	117.9	23.3
Interest	1.1	0.8	0.3
Sale of goods and services⁽³⁾	119.3	217.8	(98.5)
Grants	16.2	4.2	12.0
Resources received free of charge	7.5	–	7.5
Other income	7.0	1.0	6.0
Total income from transactions	855.3	831.9
Expenses from transactions
Employee benefits⁽⁴⁾	372.0	406.2	34.2
Depreciation⁽⁴⁾	30.4	50.4	20.0
Interest expense	0.3	–	(0.3)
Grants expense⁽⁵⁾	194.7	65.3	(129.4)
Other expenses⁽⁴⁾	256.7	310.0	53.3
Total expenses from transactions	854.1	831.9	(22.2)
Net result from transactions	1.2	–	1.2
Other economic flows included in net result
Net gain/(loss) on non-financial assets	0.2	–	0.2
Total other economic flows included in net result	0.2	–	0.2
Net result	1.4	–	1.4
Other economic flows — other comprehensive income
Items that will not be reclassified to net result
Other⁽⁶⁾	40.0	–	40.0
Total other economic flows — other comprehensive income	40.0	–	40.0
Comprehensive result	41.4	–	41.4

Summary:

DPC portfolio’s net operating balance, which reflects the change in DPC’s net worth due to transactions, and directly attributed to government policies is a surplus of $1.2 million compared with the published budget’s break-even result.

The comprehensive result is a surplus of $41.4 million, which is mainly due to derecognition of Cenitex‘s accumulated funds balance from the DPC portfolio due to machinery of government changes.

Notes:

The notes below provide an explanation of the major variances between the 2022–23 comprehensive result compared with the budgeted comprehensive result.

Larger actual output appropriations income, primarily due to releasing funds held in contingency since publishing the budget, which included funding for Breakthrough Victoria Pty Ltd (BVPL) operations and the Delivering First Peoples’ Ownership of Victoria’s Treaty Process initiative.
Higher actual special appropriations income, which is mainly attributed to increased funding needed to cover the costs associated with conducting the 2022 State Election.
Lower actual sale of goods and services income, which is predominantly due to transferring out Cenitex from DPC to the Department of Government Services (DGS) portfolio on 1 January 2023 due to machinery of government changes since publishing the budget.
Lower actual employee, depreciation and other expenses, which is largely due to transferring out Cenitex and other major functions, including Digital Victoria, Service Victoria, Public Record Office Victoria (PROV) and corporate functions from DPC to the DGS portfolio on 1 January 2023 due to machinery of government changes since publishing the budget.
Higher actual grant expenses, which is mainly attributable to larger funds on-passed as grants by DPC to BVPL for their operational requirements and grants provided for the Delivering First Peoples’ Ownership of Victoria’s Treaty Process initiative, which were not reflected in the published budget.
Movement within equity due to derecognition of Cenitex’s accumulated funds balance from DPC to the DGS portfolio in lieu of machinery of government changes since publishing the budget.

Balance sheet as at 30 June 2023

Controlled	2023 actual $m	2023 budget $m	Variation $m
Financial assets
Cash and deposits⁽¹⁾	40.5	86.3	(45.8)
Receivables from government	54.9	64.1	(9.2)
Other receivables⁽²⁾	11.8	95.7	(83.9)
Other financial assets	–	18.6	(18.6)
Total financial assets	107.2	264.7	(157.5)
Non-financial assets
Inventories	4.1	3.1	1.0
Property, plant and equipment⁽³⁾	267.7	762.8	(495.1)
Intangible assets⁽⁴⁾	22.2	57.8	(35.6)
Other non-financial assets⁽⁵⁾	2.6	31.2	(28.6)
Total non-financial assets	296.6	854.9	(558.3)
Total assets	403.8	1,119.6	(715.8)
Liabilities
Payables⁽⁶⁾	16.7	83.5	66.8
Borrowings⁽⁶⁾	3.8	22.6	18.8
Provisions⁽⁶⁾	51.5	77.1	25.6
Total liabilities	72.0	183.2	111.2
Net assets	331.8	936.4	(604.6)
Equity
Contributed capital⁽⁷⁾	71.0	479.3	(408.3)
Reserves⁽⁷⁾	211.6	392.4	(180.8)
Accumulated surplus	49.2	64.6	(15.4)
Total equity	331.8	936.4	(604.6)

Summary:

Net assets for the DPC portfolio as at 30 June 2023 is $604.6 million lower compared with the budget as published in the
2022–23 State Budget.

Notes:

The notes below provide an explanation of the major variances in asset, liability and equity items.

Variance is mainly due to derecognition of cash and deposits and Victorian Funds Management Corporation investment balances pertaining to Cenitex, which was transferred out from DPC to the DGS portfolio on 1 January 2023 due to machinery of government changes, which is not reflected in the published budget.
Variance is primarily due to settling outstanding debt by the Department of Families, Fairness and Housing for recoupment of post machinery of government costs billed by DPC.
Decrease is mainly due to derecognition of property, plant and equipment balances out of DPC due to machinery of government changes, including those relating to PROV, which is not reflected in the published budget.
Decrease is mainly due to derecognition of intangible asset balances out of DPC due to machinery of government changes, including those relating to Service Victoria, which is not reflected in the published budget.
Decrease is mainly due to derecognition of prepayment balances out of DPC due to machinery of government changes, including those relating to Cenitex, which is not reflected in the published budget.
Decrease is mainly due to derecognition of right of use lease liability balances, payables and employee leave provision (annual and long service leave) balances transferred out of DPC due to machinery of government changes, including those relating to Cenitex, PROV, Service Victoria and corporate functions, which is not reflected in the published budget.
Decrease is mainly due to contributed capital and reserve transfers pertaining to machinery of government changes as are requirements of FRD 119A, including Cenitex, PROV, Service Victoria and corporate functions, which is not reflected in the published budget.

Cash flow statement for the year ended 30 June 2023

Controlled	2022–23 actual $m	2022–23 budget $m	Variation $m
Cash flows from operating activities
Receipts from government⁽¹⁾	724.3	585.0	139.3
Receipts from other entities	228.8	227.3	1.5
Total receipts	953.0	812.3	140.7
Payments of grants⁽²⁾	(191.9)	(65.3)	(126.6)
Payments to suppliers and employees⁽³⁾	(612.2)	(715.0)	102.8
Total payments	(804.0)	(780.3)	(23.7)
Net cash flows from operating activities	149.0	32.0	117.0
Cash flow from investing activities
Net investment⁽⁴⁾	(275.5)	(0.8)	(274.7)
Payments for non-financial assets⁽⁵⁾	(32.7)	(46.5)	13.8
Proceeds from the sale of non-financial assets	1.2	–	1.2
Net cash flows used in investing activities	(307.0)	(47.3)	(259.7)
Cash flows from financing activities
Owner contributions by the state government⁽⁶⁾	283.6	18.8	264.8
Net borrowings⁽⁷⁾	(68.1)	(7.1)	(61.0)
Net cash flows from financing activities	215.6	11.7	203.9
Net increase/(decrease) in cash held	(57.6)	(3.6)	(54.0)
Cash at the beginning of the financial year	98.1	89.9	8.2
Cash at the end of the financial year	40.5	86.3	(45.8)

Summary:

The net cash position (primarily the Trust State Administration Unit balances) for the DPC portfolio as at 30 June 2023 is $40.5 million. This is $45.8 million lower than the original budgeted balance of $86.3 million. The cash movements have been adjusted to remove the impact of working capital (balance sheet) machinery of government movements because these are non-cash transactions.

Notes:

The notes below provide an explanation of the major variances in the 2022–23 cash flow statement.

Variance is primarily due to a major release of funds held in contingency since publishing the budget, which include funding for BVPL operations, the Delivering First Peoples’ Ownership of Victoria’s Treaty Process initiative and additional funding for the Victorian Electoral Commission to cover election requirements.
Variance is mainly attributable to larger funds on-passed as grants to portfolio agencies, which includes BVPL and the Victorian Electoral Commission to meet their operational requirements and grants provided for the Delivering First Peoples’ Ownership of Victoria’s Treaty Process initiative, which were not reflected in the published budget.
Variance is largely due to the impact of lower operational activity resulting from transferring Cenitex out of DPC and other major functions (Digital Victoria, Service Victoria, PROV and corporate functions) to the DGS portfolio on 1 January 2023, which is not reflected in the published budget.
Variance is primarily attributable to DPC’s payment of BVPL’s capital funding for 2022–23.
Variance is predominantly from lower asset investment activity resulting from transferring Service Victoria from DPC to the DGS portfolio, which is not reflected in the published budget.
Variance predominantly reflects releasing funds held in contingency for BVPL’s capital funding for 2022–23.
Variance mainly relates to payments made on behalf of departments for machinery of government areas transferred out of DPC post 1 January 2023 due to systems not yet transitioned out.

Statement of changes in equity for the year ended 30 June 2023

Controlled	2022–23 actual $m	2022–23 budget $m	Variation $m
Contributed capital
Opening balance	435.5	435.5	–
Contribution from owners	(364.5)	43.8	(408.3)
Closing balance	71.0	479.3	(408.3)
Reserves
Opening balance	599.3	599.3	–
Comprehensive result	(387.7)	95.1	(482.8)
Closing balance	211.6	392.4	(180.8)
Accumulated surplus
Opening balance	95.1	95.1	–
Comprehensive result	(45.9)	(30.5)	(15.4)
Closing balance	49.2	64.6	(15.4)
Total equity	331.8	936.4	(604.6)

Administered items statement for the year ended 30 June 2023

Controlled	2022–23 actual $m	2022–23 budget $m	Variation $m
Administered income
Special appropriations	18.3	18.3	0.0
Sales of goods and services	1.6	0.8	0.8
Other income	2.2	0.3	1.9
Total administered income	22.1	19.4	2.7
Administered expenses
Expenses of behalf of the state	35.1	35.4	0.3
Payments into the Consolidated Fund	1.6	1.1	(0.5)
Total administered expenses	36.7	36.5	(0.2)
Income less expenses	(14.6)	(17.1)	2.5
Administered assets
Cash and deposits	2.0	2.6	(0.6)
Receivables	15.7	20.4	(4.7)
Total administered assets	17.7	23.0	(5.3)
Administered liabilities
Payables	2.3	3.3	1.0
Total administered liabilities	2.3	3.3	1.0
Net assets	15.4	19.7	(4.3)

Updated 1 November 2023