QUALITY DECLARATION - SUMMARY

INSTITUTIONAL ENVIRONMENT

Statistics presented in Government Finance Statistics, Australia (cat. no. 5512.0) are based on information provided in, or underlying the published accounting statements and reports of governments and their authorities. For the Commonwealth Government and all state governments the primary data sources are:

• public accounts and budget management systems of state treasuries and the Australian Department of Finance and Deregulation;
• annual reports of government departments and authorities;
• budget papers; and
• reports of the Auditors-General.

For local government, the main data sources are annual statements of accounts completed by local authorities.

For information on the institutional environment of the Australian Bureau of Statistics (ABS), including the legislative obligations of the ABS, financing and governance arrangements, and mechanisms for scrutiny of ABS operations, please see ABS Institutional Environment.

RELEVANCE

The term 'Government Finance Statistics' refers to statistics that measure the financial activities of governments and reflect the impact of those activities on other sectors of the economy. The Australian system of Government Finance Statistics (GFS), is designed to provide statistical information on public sector entities in Australia classified in a uniform and systematic way.

GFS enables policy makers and users to analyse the financial operations and financial position of the public sector by the level of government, institutional sector or set of transactions. The system of GFS is based on international standards set out in the System of National Accounts 1993 (SNA93) and the International Monetary Fund's Government Finance Statistics Manual 2001 (GFSM 2001).

The system of GFS provides details of revenues, expenses, cash flows and assets and liabilities of the Australian public sector and comprises units which are owned and/or controlled by the Commonwealth, state and local governments.

This release presents GFS on an accrual accounting basis for each jurisdiction for the general government sector, the non-financial public sector, and total public sector. Data for public non-financial corporations and public financial corporations are available on the ABS website along with other time series tables. The key statements presented are; the operating statement, the cash flow statement, and the balance sheet.


TIMELINESS

Annual Government Finance Statistics are released within 10 months of the end of the financial year.

ACCURACY

For practical reasons the ABS does not attempt to cover all economic activity of the public sector in its GFS system. Undercoverage can arise because units are omitted or because some activities are not covered. This only occurs when the economic activity of these units is relatively insignificant.

The main influence on the accuracy of GFS data are non-sampling error. Non-sampling error arises from inaccuracies in collecting, recording and processing the data. The most significant of these errors are misreporting of data, and processing errors. Every effort is made to minimise error by working closely with data providers, training of processing staff and efficient data processing procedures.

Revisions are made to the annual Government Finance Statistics data as required as a result of new and updated information available from providers.



COHERENCE

In 1998-99, the ABS adopted an accrual basis of recording for its GFS. Prior to this the ABS GFS was cash based. In addition to the information published, some GFS data are available back to 1961-62. However, due to the different compilation and data sources, cash flow data from 1998-99 onwards are not directly comparable with earlier cash data. The ABS has not established a quantitative measure of this break in series because the existing data sources do not permit this. Data on a pure accruals basis are only available from 1998-99.

In 1991, the Commonwealth and state Governments resolved to implement a uniform presentation framework (UPF) in their budget documents to introduce uniformity into the presentation of GFS. Variations between ABS statistics and those presented by the jurisdictions can exist because the ABS may:

• have a different view on classification treatments applied by jurisdictions;
• employ a different consolidation methodology to those used in jurisdiction treasuries;
• apply reconciliation adjustments when it consolidates data for all jurisdictions
• include data which were not available when a jurisdiction's GFS presentations were published.

The statistics in this release have been compiled using standard definitions, classifications and treatment of government financial transactions to facilitate comparisons between levels of government and between states within a level of government. However, the statistics also reflect real differences between the administrative and accounting arrangements of the various jurisdictions and these differences need to be taken into account when making interstate comparisons. For example, only a state level of government exists in the ACT. The ACT government performs a number of functions which are undertaken by local government authorities in other jurisdictions.

To compile statistics about the financial activities of a particular level of government, or any other grouping of public sector units, transactions and debtor/creditor relationships between units within the chosen grouping (sector or subsector) have to be matched and eliminated to avoid double counting. The process of matching and eliminating these items within the chosen group is known as 'consolidation'.

Australian Accounting Standard 31 (AAS31) 'Financial Reporting by Governments' has been adopted by all Australian governments in the preparation of their financial statements. Accounting reports prepared under AAS31 and statistical reports prepared on a GFS basis serve different purposes and are aimed at different sets of users. Thus, differences between GFS and AAS31 analytical measures (GFS net operating balance and AAS31 operating surplus/deficit for example) can be expected. Descriptions of GFS/AAS31 reconciliations are outlined in Chapter 7 of Australian System of Government Finance Statistics: Concepts, Sources and Methods (cat. no. 5514.0).

While GFS and the Australian System of National Accounts share the same conceptual framework (SNA93), there are methodological differences between GFS and ASNA analytical measures (GFS and ASNA net worth and net lending/borrowing for example). The main differences in the net/lending borrowing measures relate to adjustments for market rates of interest, consumption of fixed capital and ownership transfer costs between the GFS and ASNA. Descriptions of GFS/ASNA reconciliations are outlined in Section 6 of the ABS publication Information Paper: Accruals-based Government Finance Statistics (cat. no. 5517.0).


INTERPRETABILITY

The publication Government Finance Statistics, Australia (cat. no. 5512.0)contains detailed Explanatory Notes and Glossary that provide information on the data sources, terminology, classifications and other technical aspects associated with these statistics

Detailed information on the concepts, sources and methods used in compiling GFS can be found in Australian System of Government Finance Statistics: Concepts, Sources and Method (cat. no. 5514.0.55.001) electronic version or (cat. no. 5514.0) PDF version.


ACCESSIBILITY

In addition to the information provided in the publication a series of data cubes are also available which provide time series data from 1998-99 onwards and data for Public Non-financial and Financial Corporations.

If the information you require is not available from the published data then the ABS may have other relevant data available on request. Inquiries should be made to the National Information and Referral Service on 1300 135 070, email <client.services@abs.gov.au> or Glynis Orrell on Canberra (02) 6252 5735, email <public.finance@abs.gov.au>.