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Financial Management Indicators
Following is a summary report against a selected number of key performance indicators that aim to drive improved financial management outcomes in the Registry.
Financial Performance
Indicator: Achieve budget break-even The operating position of the Registry has improved significantly over the past year with an interim operating surplus of $1.948m ($0.164m deficit in 1999-00) achieved, which is the first surplus since 1997-98 (which produced a cash surplus of $0.147m in the pre-accrual period, but without any capital program, any leasehold development of consequence, or any IT platform or a practical Case Management System replacement strategy). A more rigorous approach to budget management has been employed with the ‘operating’ and ‘capital’ budgets reviewed on a quarterly basis for both the current year and the impacts on future years, thus providing a stronger strategic focus for major expenditure items, particularly in respect of the capital program.
Financial Position
Indicator: Maintain or improve balance sheet position in respect of equity, capital program and cash reserve The total equity position improved for 2000-01 from the negative $2.669m in 1999-00 owing to the operating surplus for the 2000-01 financial year. The need to focus on the agency’s equity position arose because in the previous financial year, it was brought to light, that judges’ leave provisions had not been funded in the past and had never been brought to book in the financial statements. That is, judges’ leave had accrued but had not been funded, let alone been identified as requiring provisioning. An additional $2.1m was brought formally to book and the liability is now funded, largely, by the recent surpluses and monthly provisioning. This has stabilised the financial position of the Registry and provided the foundation for the professional financial planning and management of the organisation’s resources well into the future. The cash reserve, which is a mix of term deposits and on-call funds (see Agency Banking below) has increased by $1.260m to $3.223m. The agency’s historically accumulated deficits have been halved in 12 months. A capital program ($1.682m budget) has been introduced and has included major items such as the new Case Management System, refurbishment budgets and leasehold improvements.
Agency Banking
Indicator: Banking initiatives to ensure acceptable return on (any) cash for the agency’s benefit A ‘Cash Flow Planning Policy’ has been implemented to provide a framework for management of the Registry’s cash, both in the short and longer term and balances the need to have margins of safety to cover employee provisions, the capital improvement budget and operational costs. The Registry has taken advantage of the term deposit investment options available under the agency banking reforms with between $1m and $2.5m invested at any time, thus increasing interest earned.
Contract Management
Indicator: Review efficiency and effectiveness by 1 July 2001 of major contracts A new contract management process was introduced in June 2000 to provide the framework for management of contracts within the Registry. A Contract Management Committee was established as the cornerstone of this framework and has approved a number of significant and strategic contracts including a new transcription contract, desktop upgrade and videoconferencing network. Quarterly performance reporting has been introduced for a number of contracts, mainly travel services (which is a cluster contract), transcription services and the contracts regulating the outsourced Registry functions. A new suite of quantitative and qualitative performance indicators has been applied to Registry outsourcing contracts for which the service providers are the State governments of Queensland, Western Australia and South Australia. Reviews of contract performance and accountability processes have also been undertaken for several major contracts such as transcription services and contract conciliators for termination of employment matters. Significant savings were achieved in respect of the transcription and travel contracts compared with 1999-00.
Financial Reporting
Indicator: Meet external audit requirements and provide evidence of any proactive audit measures undertaken by the agency as improvement measures Items raised by external auditors in their audit of the financial statements are of a minor nature. Improved processes to reconcile the Registry’s payroll system and the general ledger were introduced, which overcome minor concerns raised in past audits. The Registry’s asset register (which has been rebuilt, in effect) has been transferred from stand-alone systems to the asset module within the Registry’s financial management information system (FMIS). This will improve the reporting and reconciliation of assets. All major contracts have also been reviewed to ensure appropriate payment and costs controls are in place and that opportunities for fraud are minimised.
Financial Management
Indicator: Put in place and commence review by 1 July 2001 appropriate internal controls of a governance nature The Audit Committee has agreed to the introduction of a new financial management framework, which will bring together accounting policies and financial regulations (chief executive instructions, resource management instructions and procedures). This will replace all encompassing chief executive instructions with a more targeted approach which separates the instructions from the detailed procedures and is available in a user friendly form on the intranet. The financial delegations were significantly overhauled in 2000 to bring them in line with the Registry’s budget management environment.
Senior Resource Management Team staff (from left) Mr Paul Parry, Mr Dennis Mihelyi and Mr Ken Morgan.
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