128 128 AUSTRALIAN SPORTS COMMISSION ANNUAL REPORT 2016–17 FINANCIAL PERFORMANCE AUSTRALIAN SPORTS COMMISSION NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS For the year ended 30 June 2017 Note 11: Explanations of major budget variances Affected line items (and statement) Explanations of major variances Grants (Statement of Comprehensive Income) Grants (Cash Flow Statement) When compared to Original Budget, an additional $15.116m in grant expenditure was incurred in 2016-17. The increase was primarily driven to maintain or increase high performance and participation funding levels to national sporting organisations and athletes. This was provided through additional funding received from the Department of Health ($7.900m), Commonwealth Games Australia ($1.250m), the Department of Prime Minister and Cabinet ($0.600m) and the repurposing of operational funding to assist the ASC in optimising the delivery of its activities and programs. Suppliers (Statement of Comprehensive Income) Suppliers (Cash Flow Statement) When compared to Original Budget, an additional $6.264m in supplier expenditure was incurred in 2016-17. During the financial year the ASC engaged resources and relevant specialist expertise to assist with the delivery of its programs and to support strategic planning activities. Employee benefits (Statement of Comprehensive Income) Employees (Cash Flow Statement) When compared to Original Budget, a decrease of $6.821m in employee expenditure was incurred in 2016-17. The delivery of ASC programs by means other than employees was achieved through the engagement of other forms or resources, external expertise or through the direct provision of grants. Contributions from Government entities (Statement of Comprehensive Income) Contributions from Government entities (Cash Flow Statement) When compared to Original Budget, an additional $9.062m in contributions from Government entities was received in 2016-17. The increase was primarily due to $7.900m being received from the Department of Health to maintain funding to National Sporting Organisations (refer to Note 7: Related party disclosures). Other sources not previously budgeted for included funding from federal and state governments for indigenous sports and women leaders in sport initiatives. Cash and cash equivalents (Statement of Financial Position) Term deposits (Statement of Financial Position) Purchase of property plant and equipment (Cash Flow Statement) When compared to Original Budget, a decrease of $8.416m in purchases of property, plant and equipment was incurred in 2016-17. The decrease was primarily due to a number of capital projects being placed on-hold while the ASC continued to develop its business and site strategies, alongside some capital projects rolling into 2017-18 for completion, and genuine savings identified during the initial scoping and procurement phases. The lower spend on property, plant and equipment is the primary driver for an increase in overall cash and investment balance of $11.972m when compared to the Original Budget. The following table provides explanations for major variances between the Original Budget as presented in the 2016-17 Portfolio Budget Statements (PBS) to the 2016-17 final outcome as presented in accordance with Australian Accounting Standards. The Budget is not audited. The ASC provides high level commentary of major variances between original budgeted and actual amounts. Major variances are those deemed relevant to the analysis of ASC's performance and are not focussed merely on numerical differences between the Budget and actual amounts.