Statement of Intent 1 July 2005 - 30 June 2008
Part 3: Non-departmental forecast report
Introduction
The Ministry procures and refurbishes, on behalf of the Crown, items of equipment contributing to a capability of the New Zealand Defence Force. This activity is summarised in the following non-departmental schedules.
Schedule of non-departmental forecast revenues
For the year ending 30 June 2006
Non-departmental revenues are administered by the Ministry on behalf of the Crown.
As these revenues are not established by the Ministry nor earned in the production of the Ministry's outputs, they are not reported in the Ministry's forecast financial statements.
| 2004/05 |
2005/06 | |||
|---|---|---|---|---|
| Measurement Basis |
Budgeted $000 |
Estimated actual $000 |
Budget $000 |
|
| Administered on behalf of the Minister of Defence | ||||
| Sales of military equipment, at cost, to New Zealand Defence Force (Note 1) | Historical cost | 282,348 | 282,348 | 500,391 |
| GST on sales to New Zealand Defence Force | Historical cost | 35,294 | 35,294 | 62,549 |
| Interest on foreign currency investments | Historical cost | 170 | 170 | 170 |
| Total revenues administered on behalf of the Minister of Defence | 317,812 | 317,812 | 563,110 | |
Note 1
| 2004/05 |
2005/06 | ||
|---|---|---|---|
| Budgeted $000 |
Estimated actual $000 |
Budget $000 |
|
| The individual projects are: | |||
| Maritime helicopters | 861 | 861 | - |
| ANZAC ships | 1,006 | 1,006 | - |
| Tactical communications equipment | 4,958 | 4,958 | 432 |
| Light armoured vehicles | 123,229 | 123,229 | 16,468 |
| B-757 aircraft modification | 10,262 | 10,262 | 14,318 |
| Medium range anti-armour weapons | 5,283 | 5,283 | 12,535 |
| Light operational vehicles | 42,899 | 42,899 | 47,531 |
| Very low level air defence system | 2,088 | 2,088 | 3,829 |
| P-3K Orion systems upgrade | 30,765 | 30,765 | 119,335 |
| C-130H Life extension | - | - | 117,685 |
| Project Protector vessels | 60,997 | 60,997 | 168,258 |
| Total | 282,348 | 282,348 | 500,391 |
Schedule of non-departmental forecast expenses
For the year ending 30 June 2006
Non-departmental expenses are administered by the Ministry on behalf of the Crown.
As these expenses are not spent in the production of the Ministry's outputs, they are not reported in the Ministry's forecast financial statements.
| 2004/05 |
2005/06 | |||
|---|---|---|---|---|
| Measurement Basis |
Budgeted $000 |
Estimated actual $000 |
Budget $000 |
|
| Administered on behalf of the Minister of Defence | ||||
| Purchase of military equipment (Note 1) | Historical cost | 377,184 | 373,108 | 443,117 |
| GST input tax expensed | Historical cost | 24,245 | 23,837 | 18,200 |
| Total expenses administered on behalf of the Minister of Defence | 401,429 | 396,945 | 461,317 | |
Note 1
| 2004/05 |
2005/06 | ||
|---|---|---|---|
| Budgeted $000 |
Estimated actual $000 |
Budget $000 |
|
| The individual projects are: | |||
| Maritime helicopters | 8 | 8 | - |
| ANZAC ships | 368 | 368 | - |
| Light armoured vehicles | 25,540 | 22,766 | - |
| B-757 aircraft modification | 10,179 | 6,503 | 10,666 |
| Tactical communications equipment | 1,907 | 1,910 | - |
| Light operational vehicles | 75,915 | 75,813 | 11,707 |
| Medium range anti-armour weapons | 11,128 | 10,262 | 6,747 |
| Very low level air defence system | 2,697 | 2,697 | 2,728 |
| P-3K Orion systems upgrade | 72,962 | 70,791 | 120,436 |
| C-130H Life extension | 38,950 | 40,222 | 113,793 |
| Project Protector vessels | 137,530 | 141,768 | 177,040 |
| Total | 377,184 | 373,108 | 443,117 |
Schedule of non-departmental forecast assets
For the year ending 30 June 2006
Non-departmental assets are administered by the Ministry on behalf of the Crown.
As these assets are neither controlled by the Ministry nor used in the production of the Ministry's outputs, they are not reported in the Ministry's statement of forecast financial position.
| 2004/05 |
2005/06 | |||
|---|---|---|---|---|
| Measurement Basis |
Budgeted $000 |
Estimated actual $000 |
Budget $000 |
|
| Administered on behalf of the Minister of Defence | ||||
| Crown bank accounts | Historical cost | 31,568 | 69,538 | 78,221 |
| Debtors and receivables | Net realisable value | - | - | - |
| Work in progress | Net realisable value | 230,845 | 193,283 | 136,009 |
| Total assets administered on behalf of the Minister of Defence | 262,413 | 262,821 | 214,230 | |
Schedule of non-departmental forecast liabilities
For the year ending 30 June 2006
Non-departmental liabilities are administered by the Ministry on behalf of the Crown.
As these liabilities are neither controlled by the Ministry nor used in the production of the Ministry's outputs, they are not reported in the Ministry's statement of forecast financial position.
| 2004/05 |
2005/06 | |||
|---|---|---|---|---|
| Measurement Basis |
Budgeted $000 |
Estimated actual $000 |
Budget $000 |
|
| Administered on behalf of the Minister of Defence | ||||
| Creditors and payables | Historical cost | 9,586 | 9,586 | 9,586 |
| Total liabilities administered on behalf of the Minister of Defence | 9,586 | 9,586 | 9,586 | |
Statement of non-departmental accounting policies
Generally Accepted Accounting Practice rules for recognition and measurement have been applied in the preparation of the non-departmental forecast schedules.
The following accounting policies have been applied:
Revenue Recognition
Military equipment is sold at cost to the New Zealand Defence Force in July and January each year. Revenue is recognised and reported in those months.
Interest Income
Interest income is recognised in the period in which it is earned.
Goods and Services Tax (GST)
Input GST on the procurement or refurbishment of military equipment is expensed.
Work in Progress
Work in progress comprises project expenditure to be recovered from the New Zealand Defence Force for the six months preceding balance date, plus accruals at balance date.
Foreign Currency
Foreign currency transactions are converted into New Zealand dollars at the exchange rate at the date of the transaction. Where a forward exchange contract has been used to establish the price of a transaction, the forward rate specified in that foreign exchange contract is used to convert that transaction to New Zealand dollars. Consequently, no exchange gain or loss resulting from the difference between the forward exchange contract rate and the spot exchange rate on date of settlement is recognised.
Monetary assets and liabilities are translated to New Zealand dollars at the closing exchange rate. The resulting unrealised exchange gain or loss is recognised in the schedule of non-departmental forecast expenses. Other exchange gains or losses, whether realised or unrealised, are recognised in the schedule of non-departmental forecast expenses in the period to which they relate.
Changes in non-departmental accounting policies
No changes in accounting policies are expected to be made during the forecast period.
