Introduction

These forecast financial statements for the Ministry for the Environment contain the following statements pursuant to section 41 of the Public Finance Act (1989):

a statement of financial performance reflecting the forecast revenue and expenses for the financial year ending 30 June 2008
a statement of the estimated financial position as at 30 June 2007 and forecast financial position as at 30 June 2008
a statement of cash flows reflecting forecast cash flows for the year ending 30 June 2008
a statement showing the reconciliation of the net forecast operating surplus to the net cash flow forecast from operating activities for the year ending 30 June 2008
a statement of forecast movements in taxpayers' funds (equity)
a statement of forecast commitments
a statement of forecast details of physical and intangible assets by category
a statement of departmental capital expenditure
a statement of significant underlying assumptions
a statement of accounting policies
a statement of objectives specifying the financial performance forecast for the Ministry for the year ending 30 June 2008
a statement of objectives specifying the performance forecast for each class of outputs for the year ending 30 June 2008

Financial highlights

	2006/07 Main estimates $000	2006/07 Supplementary estimates $000	2006/07 Estimated actual $000	2007/08 Budget $000
Revenue: Crown	54,817	50,653	49,003	65,629
Revenue: Departmental and Other	438	730	730	629
Output expenses	55,250	51,378	49,728	66,253
Other expenses	-	-	-	-
Net surplus from operations	5	5	5	5
Physical assets	3,165	3,610	3,268	3,704
Intangible assets	-	-	-	1,533
Taxpayers' funds	3,543	3,085	2,668	4,887
Net cash flows from operating activities	819	(1,992)	(1,992)	595
Net cash flows from investing activities	(1,895)	(1,730)	(1,388)	(2,804)

Statement of financial performance for the year ending 30 June 2008

	2006/07 Main estimates $000	2006/07 Supplementary estimates $000	2006/07 Estimated actual $000	2007/08 Budget $000
Revenue
Crown	54,817	50,653	49,003	65,629
Departments	428	428	428	428
Other	5	297	297	196
Interest	-	-	-	-
Total revenue	55,250	51,378	49,728	66,253
Expenditure
Personnel	19,785	21,020	21,046	23,668
Operating	34,563	29,680	28,004	41,545
Depreciation	749	525	525	551
Amortisation on intangible assets	-	-	-	289
Capital charge	153	153	153	200
Total expenditure	55,250	51,378	49,728	66,253
Profit on sale of assets	5	5	5	5
Other expenses	-	-	-	-
Net surplus from operations	5	5	5	5

Statement of estimated financial position as at 30 June 2007 and forecast financial position as at 30 June 2008

	Actual financial position as at 30 June 2006 $000	Estimated actual financial position as at 30 June 2007 $000	Forecast financial position as at 30 June 2008 $000
Taxpayers’ funds	2,043	2,668	4,887
Total taxpayers’ funds	2,043	2,668	4,887
Represented by:
Current assets:
Bank	11,137	6,480	6,485
Pre-payments	133	120	100
Debtors and receivables	673	350	350
Total current assets	11,943	6,950	6,935
Physical assets	2,478	3,268	3,704
Intangible assets	-	-	1,533
Total assets	14,421	10,218	12,172
Current liabilities:
Creditors and payables	9,042	6,145	5,880
Provision for the repayment of surplus to the Crown	1,902	5	5
Employee entitlements	702	785	785
Total current liabilities	11,646	6,935	6,670
Non-current liabilities:
Employee entitlements	732	615	615
Total liabilities	12,378	7,550	7,285
Net assets	2,043	2,668	4,887

Statement of cash flows for the year ending 30 June 2008

	2006/07 Main estimates $000	2006/07 Supplementary estimates $000	2006/07 Estimated actual $000	2007/08 Budget $000
Cash flows from operating activities
Cash provided from:
Supply of outputs to Crown	54,817	50,653	49,003	65,629
Supply of outputs to Departments	428	557	557	428
Supply of outputs to others	5	491	491	196
Cash disbursed to:
Cost of producing outputs	(54,278)	(53,540)	(51,890)	(65,458)
Capital charge	(153)	(153)	(153)	(200)
Net cash flows from operating activities	819	(1,992)	(1,992)	595
Cash flows from investing activities
Cash provided from:
Sale of physical assets	5	5	5	5
Cash disbursed to:
Purchase of physical assets	(1,900)	(1,735)	(1,393)	(2,609)
Purchase of intangible assets	-	-	-	(200)
Net cash flows from investing activities	(1,895)	(1,730)	(1,388)	(2,804)
Cash flows from financing activities
Cash provided from:
Capital contribution	1,500	1,042	625	2,219
Cash disbursed to:
Repayment of surplus to Crown	(2,506)	(1,902)	(1,902)	(5)
Net cash flows from financing activities	(1,006)	(860)	(1,277)	2,214
Net increase / (decrease) in cash held	(2,082)	(4,582)	(4,657)	5
Opening cash balance at 1 July	5,745	11,137	11,137	6,480
Projected closing cash and deposits at 30 June	3,663	6,555	6,480	6,485

Reconciliation of net operating surplus to net cash flow from operating activities for the year ending 30 June 2008

	2006/07 Main estimates $000	2006/07 Supplementary estimates $000	2006/07 Estimated actual $000	2007/08 Budget $000
Net surplus from operations	5	5	5	5
Add non-cash items
Depreciation	749	525	525	551
Amortisation on intangible assets	-	-	-	289
Add/(less) movements in working capital items
Decrease in pre-payments	-	13	13	20
Decrease in debtors and receivables	-	320	320	-
Decrease in payables and provisions	-	(626)	(626)	(200)
Increase / (decrease) in other accrued liabilities	70	(2,193)	(2,193)	(65)
Decrease in provision for employee entitlements	-	(34)	(34)	-
Decrease in GST receivable	-	3	3	-
Add/(less) investing activity
Net gain on sale of physical assets	(5)	(5)	(5)	(5)
Net cash flow from operating activities	819	(1,992)	(1,992)	595

Statement of the forecast movement in taxpayers’ funds for the year ending 30 June 2008

	Actual financial position as at 30 June 2006 $000	Estimated actual financial position as at 30 June 2007 $000	Forecast financial position as at 30 June 2008 $000
Taxpayers’ funds brought forward as at 1 July	1,843	2,043	2,668
Net surplus from operations	1,902	5	5
Total recognised revenues and expenses for the year	1,902	5	5
Provision for repayment of surplus to the Crown	(1,902)	(5)	(5)
Capital contribution	200	625	2,219
Taxpayers’ funds as at 30 June	2,043	2,668	4,887

Statement of forecast commitments for the year ending 30 June 2008

	Actual financial position as at 30 June 2006 $000	Estimated actual financial position as at 30 June 2007 $000	Forecast financial position as at 30 June 2008 $000
Operating and accommodation lease commitments (GST exclusive)
Not later than 1 year	9,396	901	901
More than 1 year but not later than 2 years	2,762	2,282	2,282
More than 2 years but not later than 5 years	6,179	3,860	3,860
More than 5 years	4,008	9,231	9,231
Total operating and lease commitments	22,345	16,274	16,274
Capital commitments	-	-	-
Total commitments	22,345	16,274	16,274

Forecast details of physical and intangible assets by category as at 30 June 2008

	Estimated actual position as at 30 June 2007 $000	Cost as at 30 June 2008 $000	Accumulated depreciation as at 30 June 2008 $000	Net book value as at 30 June 2008 $000
Physical assets
Furniture and fittings	1,367	1,910	746	1,164
Computer software	422	-	-	-
Computer hardware	537	1,540	971	569
Office equipment	67	771	194	577
Other assets	875	1,394	-	1,394
Total physical assets	3,268	5,615	1,911	3,704
Intangible assets
Computer software	-	1,993	460	1,533
Total intangible assets	-	1,993	460	1,533

Departmental capital expenditure

Capital expenditure is incurred in accordance with section 24 of the Public Finance Act (1989).

Departmental Capital Expenditure $000	2007/08 Forecast $000	2006/07 Estimated Actual $000	2006/07 Budget $000	2005/06 Actual $000	2004/05 Actual $000	2003/04 Actual $000	2002/03 Actual $000
Physical assets
Furniture and fittings	30	40	152	257	1,500	7	15
Office equipment	535	35	62	27	3	21	32
Computer software	-	215	1,534	314	0	38	9
Computer hardware	325	325	152	263	260	231	325
Other assets	1,719	700	-	175	-	-	-
Total physical assets	2,609	1,315	1,900	1,036	1,763	297	381
Intangible assets
Computer software	200
Total intangible assets	200	-	-	-	-	-	-

The furniture and fittings expenditure for the 2004/05 financial year is related to the fit out of the Ministry’s new head office (Environment House). Other assets expenditure relates to the development of the New Zealand Carbon Accounting System which will assist New Zealand in assessing its compliance with the Kyoto Protocol. Other capital expenditure is for the routine replacement and upgrade of the Ministry’s information technology and office equipment, to help our staff efficiently deliver the services set out in this Statement of Intent.

In accordance with the New Zealand International Financial Reporting Standards, computer software is classified under Intangible Assets in the 2007/08 Budget forecast.

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Statement of Intent 2007-2010