Chapter 2

Individual 2009–2010 Annual Reports

Reports under the Innovation, Industry, Science and Research portfolio

Anglo-Australian Observatory (AAO)

Organisational changes

2.1        The United Kingdom, Australia's partner in establishing the Anglo-Australian Telescope Board (AATB), decided in 2005 to withdraw from the Anglo-Australian Telescope Agreement, effective 30 June 2010. Consequently, from 1 July 2010, the Australian Government, as part of its May 2009–2010 Budgetary Measures, agreed to takeover the AAO. Legislation giving effect to these changes are:

• The Australian Astronomical Observatory Act 2010
• The Australian Astronomical Observatory (Transitional Provisions) Act 2010

2.2        As a result of the above changes, the AAO has become part of the Department of Innovation, Industry, Science and Research effective, 1 July 2010. It is now referred to as the Australian Astronomical Observatory. Therefore, the 2009–2010 Anglo-Australian Observatory Annual Report is the final independent annual report tabled in both Houses of Parliament by the organisation.

Reporting requirements

2.3        The committee considers that the AAO has largely met its reporting requirements under the Act. However, the committee notes that the report was tabled in both Houses of Parliament on 24 November 2010—after the six month deadline specified in subsection 34C(2) of the Acts Interpretation Act 1901 which applies where 'an Act requires a person to furnish a periodic report to a Minister but does not specify a period within which the report is to be so furnished'.

2.4        The committee notes that the report did not contain a Compliance Index.

Operational matters

2.5        The annual report highlights the successful partnership between the UK and Australia. The two nations celebrated their 36 year-long partnership with a symposium. The title of the symposium was Celebrating the AAO: Past, Present and Future, held on 21–25 June 2010 in Coonabarabran.

2.6        The annual report highlights a number of important discoveries made during the year:

These discoveries ranged from Earth-like planets around other stars to enormous sound waves that echoed around the universe after the Big Bang.[1]

The report also highlights current research at the AAO, namely the Anglo-Australian Planet Search (AAPS).

2.7        Numerous current community and educational programs are mentioned, while two ongoing projects are highlighted: the National Collaborative Research Infrastructure Strategy (NCRIS) funded efforts to refurbish the AAT and the construction of the HERMES spectrograph.

Australian Nuclear Science and Technology Organisation (ANSTO)

Reporting requirements

2.8        The committee considers that ANSTO has met its reporting requirements under the CAC Act.

Operational matters

2.9        The annual report notes that the Molybdenum (Mo-99) plant has been in full operation for most of the year. As a result, ANSTO expects to expand its critical exports of Mo-99 production in coming years.

2.10      In anticipation of future demand for nuclear-capable people, ANSTO has begun talks with Universities so as to bring about an increase in the number of nuclear science courses provided at undergraduate and post-graduate levels. New partners include the Australian National University, Curtin University of Technology and the University of Sydney.

2.11      Over the next four years ANSTO's Centre for Accelerator Science will see two new accelerators built, and is currently developing Hot Isostatic Pressing Technology in partnership with the US Department of Energy.

2.12      As a result of the $37 million allocation by the Federal Government in May 2009, ANSTO has also begun its Neutron Beam Expansion Project. In August 2009, ANSTO held a two-day scoping workshop:

Involving 80 national and international researchers made up of existing ANSTO instrument users.[2]

2.13      The annual report highlights that the OPAL reactor remained operational for 265 days during the 2009-2010 financial year. This operational time places it into the top three most reliable reactors globally.

Australian Research Council

Reporting requirements

2.14      The committee considers that the ARC has met its reporting requirements under the FMA and Australian Research Council Act 2001.

Operational matters

2.15      The committee notes a change in the ARC's outcome:

• Previous outcome: Growth of knowledge and innovation through providing policy advice, measuring research excellence and managing research funding schemes.
• New outcome: Growth of knowledge and innovation through managing research funding schemes, measuring research excellence and providing advice.

2.16      During the 2009-2010 financial year, the Excellence in Research for Australia (ERA) process was trialled. According to the report, the ERA has elicited much debate and engagement from Australian universities and interested stakeholders.[3] The submissions phase for a full review of the 6 discipline clusters identified by the ERA commenced on 30 June 2010 and was underway at the time the Annual Review was completed. There are several phases yet to be completed before the outcomes of the review can be reported. This review process is expected to be completed during the 2010–2011 financial year.

2.17      Three new initiatives were introduced under the National Competitive Grants Program: the Future Fellowships scheme; the Super Science Fellowship scheme; and the Research in Bionic Vision Science and Technology Initiative. In September 2009, 200 new Future Fellowships were announced. Through the Super Science initiative, in April 2010, '$27 million was awarded to 20 Australian institutions to recruit 100 early-career researchers from Australia and around the world...'[4] Finally, in December 2009, as part of the Research in Bionic Vision Science and Technology Initiative, $50 million was awarded to two Australian research teams. The initiative is a response to recommendations of the Australia 2020 Summit.

2.18      In September 2009, the ARC released the ARC Peer Review Processes Consultation Paper, seeking feedback from the research sector relating to the peer-review process. A result was the implementation of the Research Opportunity and Performance Evidence (ROPE) as a selection criterion for reviewers.

2.19      In April 2010, the ARC and the National Health and Medical Research Council were given joint responsibility for the administration of the Australian Research Integrity Committee (ARIC)—a new independent body responsible for the 'review processes by which universities and other research organisations have handled allegations of research misconduct'.[5]

2.20      The ARC noted in its annual report the release of the report entitled ARC-supported research: the impact of journal publication output, 2001-2005. The report showed that ARC-funded research published in journals has been meeting and at times exceeding, international benchmarks in all but one broad field of research.

Recommendation 2

2.21      The committee notes that while the ARC mentioned the strongest performing fields (under the Discovery Projects scheme, Agricultural, Veterinary and Environmental Sciences, Earth Sciences and Physical Sciences), it did not mention the weaker areas of research or the broad field that did not meet international benchmarks. In the future, the inclusion of the weaker performing areas would be useful as it would provide guidance for future improvements and the possible allocation of funding and/or resources.

Innovation Investment Fund (IIF) Companies

Reporting requirements

2.22      The committee considers that the IIF Companies have mostly met their reporting requirements under the Act. However, the committee notes that the report was tabled in both Houses of Parliament on 24 November 2010. This was after the six month deadline specified in subsection 34C(2) of the Acts Interpretation Act 1901, which applies where 'an Act requires a person to furnish a periodic report to a Minister but does not specify a period within which the report is to be so furnished'.

2.23      The committee also notes that the annual report did not contain a Compliance Index.

2.24      Unlike the previous 2008–2009 annual report, the Companies did not report on the number of companies invested in and their statistical information.[6] The inclusion of this information would be useful from a comparative and consistency perspective.

Operational matters

2.25      The committee notes that the annual report submitted by the IIF Companies only reports on two companies: IIF Investments Pty Ltd and IIF Foundations Pty Ltd as opposed to the five companies reported on last financial year (2008–2009). This discrepancy is due to the fact that on 28 October 2008, the Directors of IIF Investments Pty Ltd, IIF Foundations Pty Ltd, IIF (CM) Investments Pty Ltd, IIF BioVentures Pty Ltd, IIF Neo Pty Ltd, resolved to wind up the companies and to transfer all investments and their carrying values directly to the Australian Government. Consequently, the three companies were deregistered with ASIC on 23 June 2010.

2.26      A single volume is published with an overview and annual reports for IIF Investments Pty Ltd and IIF Foundations Pty Ltd. These companies are wholly-owned by the government. IIF Investments Pty Ltd invests in the five Innovation Funds, set up as unit trusts: Allen & Buckeridge II, AMWIN Innovation Fund, Momentum Ventures Unit Trust, the Australian Bioscience Trust and the Nanyang Innovation Fund.

2.27      IIF Investments also invests in the four Pre-Seed Funds: Starfish Ventures Pre-Seed Fund, GBS Genesis Fund, Allen and Buckeridge Emerging Technologies Fund, SciVentures Pre-Seed Fund and CVC REEF Limited, which is licensed under the REEF program. IIF Foundations invests in the Foundation IIF Partnership, through a partnership structure.

2.28      In 2009, the Innovation Investment Follow-on Fund (IIFF) was established. The annual report states that '[t]he program is a targeted and temporary response to protect current investments in the early stage venture capital market in response to the lack of capital given the global financial crisis'.[7] The IIFF is funded directly by the Australian Government and has thus not been included in the annual report.

Innovation Australia

Reporting requirements

2.29      The committee considers that Innovation Australia has mostly met its reporting requirements under the Act. However, the committee notes that the report was tabled in the Senate on 3 March 2011. Again, this was well after the six month deadline specified in subsection 34C(2) of the Acts Interpretation Act 1901 which applies where 'an Act requires a person to furnish a periodic report to a Minister but does not specify a period within which the report is to be so furnished'.

2.30      The committee also notes that the annual report did not contain a Compliance Index.

2.31      Innovation has failed to comply with sub–paragraph 46(2)(c) of the Industry Research and Development Act 1986, which states that:

(c) if the Board has entered into agreements under this Act, including agreements entered into under transitional arrangements, and those agreements are still in force during the year—must set out, in relation to each such agreement entered into:

(i) the name of each researcher to whom Commonwealth money has been paid in respect of a research and development program during the year; and

(ii) the amount of Commonwealth money paid to that researcher in respect of that program in the year.

Innovation has not provided the names of the researchers party to grant agreements under sub–paragraphs c(i) and (ii).

Recommendation 3

2.32      This committee recommends that Innovation table their grants as an appendix and take care to comply with the Industry Research and Development Act 1986.

Operational matters

2.33      Innovation Australia has provided over $1.1 billion of assistance to 9, 063 customers and supported over $17.6 billion in research and development (R&D) and commercialisation activities. The report states that 'a further $78 million of Australian Government funding was provided to help generate $208 million of investment in venture capital raising and energy and water efficiency infrastructure in manufacturing'.[8]

2.34      Innovation established the CA program which 'aims to assist researchers, entrepreneurs and innovative companies to convert their intellectual property into successful commercial ventures'.[9]

2.35      In May 2010, a discussion paper was presented to the Innovation Board, titled Developing a Bioeconomy for Australia, designed to assist in identifying future innovation opportunities in Australia. The result was the formation of three strategic working groups; Growing Australian SMEs to be internationally competitive and become large MNEs; Developing a Bioeconomy in Australia and Strengthening Australia's venture capital industry.

Reports under the Department of Resources, Energy and Tourism

Australian Centre for Renewable Energy Board (ACRE)

Reporting requirements

2.36      The committee considers that ACRE has largely met its reporting requirements under the Act. However, the committee notes that the report was tabled in both Houses of Parliament on 9 February 2011. Once again, this was after the six month deadline specified in subsection 34C(2) of the Acts Interpretation Act 1901 which applies where 'an Act requires a person to furnish a periodic report to a Minister but does not specify a period within which the report is to be so furnished'.

Operational matters

2.37      ACRE commenced operation in October 2009. The annual report states that the Centre:

... draws together more than $560 million of renewable energy investment to help commercialise renewable energy technologies. ACRE will be the central point of contact for Australian Government support for renewable energy and enabling technologies.[10]

2.38      On 18 November 2009, legislation was introduced to Parliament to establish the ACRE Board. The Australian Centre for Renewable Energy Act 2010 commenced on 24 March 2010. The Board's primary function is to provide advice to the Minister. It held its first meeting on 21 June 2010.

2.39      The Australian Government consolidated a number of existing programs into ACRE at its formation: namely, Renewable Energy Demonstration Program (REDP); Geothermal Drilling Program (GDP); the Second Generation Biofuels Research and Development Program (Gen 2); the Renewable Energy Equity Fund (REEF); the Advanced Electricity Storage Technologies Program (AEST) and the Wind Energy Forecasting Capability (WEFC) Initiative.

Department of Resources, Energy and Tourism

Reporting requirements

2.40      The committee considers that DRET has met its reporting requirements under the Act. The committee commends DRET on an outstanding report.

Operational matters

2.41      Highlights of DRET's year include the issuing of new offshore petroleum exploration licenses; consultation on the Draft Government Response to the Offshore Petroleum Safety Regulation Inquiry reports; the implementation of the Clean Energy Initiative, which provides the framework for the Solar Flagships and Carbon Capture and Storage Flagships programs; the commencement of the Australian Energy Market Operator on 1 July 2009; the publication of First Opportunities report on the Energy Efficiency Opportunities program; the establishment of the Tourism Quality Council of Australia and the delivering of the China Approved Destination Status Scheme to underpin the valuable Chinese tour group market.

2.42      DRET's annual report also includes the annual report of Geoscience Australia (Part 4), a prescribed agency.

National Offshore Petroleum Safety Authority

Reporting requirements

2.43      The committee considers that NOPSA has met its reporting requirements under the FMA Act and the Offshore Petroleum and Greenhouse Gas Storage Act 1997.

2.44      The NOPSA Annual Report 2009–2010 also contains the annual report of the NOPSA Advisory Board.

Operational matters

2.45      NOPSA noted that 2009–2010 was a particularly bad year for the industry due to the blow–out of the Montara wellhead platform off Australia's northern coast and the fatal Macondo Deepwater Horizon accident in the Gulf of Mexico.

2.46      NOPSA reports a decrease in personal injury rates during the 2009–2010 financial year: there were 185 cases in the previous financial year, and 116 cases in the current year of reporting. This is however countered by an 'upward trend in the hydrocarbon release rate on offshore facilities for the six-month period January to June 2010.'[11]

Snowy Hydro Ltd

Reporting requirements

2.47      Snowy Hydro Ltd is a statutory corporation. As a company limited by shares, Snowy Hydro is not subject to the requirements for annual reports of government departments and agencies outlined by the Department of Prime Minister and Cabinet. Its annual report, however, does comply with the provisions of the Corporations Act 2001.

Operational matters

2.48      Snowy Hydro Ltd and its subsidiaries manage and maintain the Snowy Hydro-electric Scheme, generating and marketing renewable electricity and electricity products. The organisation is a company limited by shares, of which the Commonwealth holds a 13 per cent stake, and Snowy Hydro is required to table its annual reports in the Federal Parliament under the Snowy Hydro Corporatisation Act 1997. This annual report covers the period 5 July 2009 to 3 July 2010, and outlines the financial performance of Snowy Hydro Ltd over the year, as well as mentioning its compliance with environmental regulations.

Reports under the Treasury Portfolio

Australia and the International Financial Institutions Annual Report 2008-09

Reporting requirements

2.49      Section 10 of the International Monetary Agreements Act 1947 provides that the Treasurer shall prepare and cause to be laid before each House of the Parliament, as soon as practicable after the end of each financial year, a report on the operations of the Act and of the operations, insofar as they relate to Australia, of the Articles of Agreement of the International Monetary Fund (IMF) and the International Bank for Reconstruction and Development (IBRD) during that financial year.

2.50      Section 7 of the International Bank for Reconstruction and Development (General Capital Increase) Act 1989 provides that the Treasurer shall prepare and cause to be laid before each House of Parliament, as soon as practicable after the end of each financial year, a report on the operations of the Act during that financial year.

2.51      The committee considers that the report has met the requirements of both Acts.

Operational matters

2.52      The 2008–09 financial year presented many challenges due to the Global Financial Crisis (GFC). On 15 November 2008, during the Washington DC Summit, the G20 Leaders agreed and declared that they would do whatever necessary to restore jobs and economic growth. A 47 point Action Plan was agreed upon and G20 Working Groups were established to carry the Plan forward.

2.53      During the London Summit on 2 April 2009, the G20 Leaders agreed on a comprehensive action plan for recovery and reform.

2.54      The Treasurer, the Hon. Wayne Swan, has been Australia's Governor on the International Monetary Fund (IMF) board since 2007. During 2008–09, the Secretary to the Treasury, Dr Ken Henry AC, was the Alternate Governor. 'The Treasurer represented Australia at the Annual Governors' meeting held on 13 October 2008 and represented Australia and the constituency of which Australia is a member at the IMFC meeting held on 11 October 2008 and 25 April 2009'.[12]

2.55      In 2008–09, Australia worked with the World Bank Group (WBG) on around 100 joint activities, ranging from small analytical projects through to multi-donor programs like the A$50 million contribution to the Food Price Crisis Response Core Multi-Donor Trust Fund. The total value of these projects amounted to A$296 million.

2.56      The annual report notes that the Treasurer represented Australia on the Board of Governors of the World Bank; Australia's Alternate Governor was the Hon. Bob McMullan MP.

2.57      In 2008–2009, the Development Committee of the WBG approved the Bank's Strategic Framework on climate change and developed its Climate Investment Funds. A second fund, the Strategic Climate Fund, was also established.

2.58      The Global Food Crisis Response Program (GFRP) was established with a financial ceiling of up to US$2 billion, in addition to the Multi-Donor Trust Fund, to facilitate the involvement of a broad range of development partners to support the GFRP.

Australian Securities and Investments Commission (ASIC)

Reporting requirements

2.59      The committee considers that ASIC has met its reporting requirements under the FMA Act and the Australian Securities and Investments Commission Act 2001.

2.60      The committee notes the absence of a Compliance Index and suggests one should be included in future annual reports.

Operational matters

2.61      According to the annual report, financial recovery from the GFC was the dominant theme throughout the financial year. Although the market has recovered somewhat, it remains below historical highs and there was continued volatility.

2.62      In their attempt to support retail investors, ASIC published a wide range of educational material and forced greater disclosure from those seeking to raise funds.

2.63      ASIC completed 30 civil proceedings and obtained more than $287 million in recoveries, costs and fines, with $15.5 million in assets frozen. According to the report, a key focus has been to use section 50 of the ASIC Act to 'seek compensation for investors who lose funds through failed investment schemes'.[13]

2.64      The collapse of Storm Financial Limited was also investigated and at the time of the completion of the annual report, ASIC was engaged in confidential discussions seeking a commercial resolution.

2.65      On the international stage, through its membership in the International Organisation of Securities Commissions (IOSCO), ASIC:

... co-led work on the regulation of securitisation and credit default swap (CDS) markets, and had an active role in IOSCO's work on supervising hedge funds, over-the-counter (OTC) markets, regulating credit rating agencies and regulatory cooperation in the supervision of cross-border activity.[14]

2.66      ASIC's 15^th Summer School was held in March 2010 in Melbourne. It attracted 290 external participants from across Australia and overseas. 76 ASIC delegates also attended, including Commissioners and senior leaders.

Australian Accounting Standards Board (AASB)

Reporting requirements

2.67      The committee considers that AASB has met its reporting requirements under the Act.

2.68      The committee notes the absence of a Compliance Index from this report, and suggests that one should be included in future annual reports.

Operational matters

2.69      During the financial year, AASB issued 15 new and amending standards, 18 exposure drafts and discussion papers and made 22 formal submissions to the IASB and the IPSASB. In addition, the AASB members and staff held four roundtable discussions and made 50 presentations to outside groups.

Australian Competition and Consumer Commission (including Australian Energy Regulator)

Reporting requirements

2.70      The committee considers that the ACCC has met its reporting requirements under the Act.

2.71      The committee would like to commend the ACCC and the AER on an excellent annual report and their comprehensive Compliance Index.

Operational matters

2.72      The Australian Consumer Law (ACL) was passed, providing consumers with the same level of protection throughout Australia. The criminalisation of cartel conduct became law on 24 July 2009.

2.73      The agency noted forthcoming changes to the Franchising Code of Conduct (effective from July 2010), which assists in providing proper information to potential franchisees and improves the dispute resolutions process.

Auditing and Assurance Standards Board (AUASB)

Reporting requirements

2.74             The committee considers that AUASB has met its reporting requirements under the Act.

2.75             The committee notes the absence of a Compliance Index.

Operational matters

2.76      The AUASB completed its three-year Clarity project, constituting the most significant change in auditing in Australia since the introduction of legally enforceable auditing standards in 2006. The completion of Clarity was complemented by the introduction of numerous other standards, including standards designed to assist service auditors reporting on controls at a service organisation.

2.77      The Chairman of the International Auditing and Assurance Standards Board (IAASB), Professor Arnold Schilder, visited the AUASB, solidifying Australia's existing relationship with the international organisation.

2.78      In June 2010, the CEO and the Executive Director attended the National Standard Setters Meeting in Dublin, where delegates from 15 nations met to discuss international audit and assurance standard-setting issues.

Financial Reporting Council (FRC)

Reporting requirements

2.79      The committee considers that the FRC has met its reporting requirements under the Act.

Operational matters

2.80      The FRC is the peak body responsible for the oversight of the accounting and auditing standards setting processes (including appointing members, other than chairs, to the AUASB and the AASB). It is assisted by a secretariat located within Treasury.

2.81      The achievements of the FRC during the 2009–2010 fiscal year include: participation in the fourth IFRS Regional Policy Forum in Singapore in May; the hosting of a high-level business delegation from Japan that visited Australia to investigate the possibility of adopting the IFRS; and meeting with a range of bodies from the accounting and auditing communities in Europe and North America.

Foreign Investment Review Board (FIRB)

Reporting requirements

2.82      FIRB is not subject to the requirements for annual reports of government departments and agencies outlined by the Department of Prime Minister and Cabinet.

2.83      The committee suggests that a specific Compliance Index may be a useful addition to FIRB's future annual reports.

Operational matters

2.84      FIRB is a non-statutory body responsible for advising the Treasurer on foreign investment policy and administration. Secretariat services to the board are provided by the Foreign Investment and Trade Policy Division of Treasury. FIRB's financial operations are reported on in Treasury's annual reports.

2.85      In December 2009, the Treasurer announced that the Board will be expanded from four to five members (including the Executive Member).

2.86      In 2009–2010, the Board approved 4401 foreign investment proposals. This represents an 18 per cent decrease on 2008–2009 figures, during which period 5352 proposals were approved.[15]

2.87      The value of the proposed investments during 2009–2010 was $139.5 billion, which represents a 23 per cent decrease on 2008–2009 figures. According to the Board, 'some of this decline can be explained by several large investments in 2008–09 and some is attributable to the screening threshold change'.[16]

2.88      The Board reports that the mineral and exploration sector was the largest in terms of value, with approved investments totalling $80.9 billion. The United States was the largest source for foreign investment proposals ($39.1 billion). The United Kingdom was the second largest investor ($28.6 billion) and China was third with approved investment proposals totalling $16.3 billion in 2008–09.[17]

National Competition Council (NCC)

Reporting requirements

2.89      The committee considers that NCC has met its reporting requirements under the Act.

Operational matters

2.90      The NCC is a statutory authority which advises governments on third party access regulations. At the time of reporting, NCC was reviewing five infrastructure applications. On 30 June, the Australian Competition Tribunal made determinations on four applications for review of the Treasurer's decisions:

• The Treasurer's decision (as of 23 May 2006) not to declare the railway service by the Mt Newman Railway be affirmed;
• The Treasurer's decision (as of 27 October 2008) to declare the service provided by the Robe Railway for a period of 20 years be varied so that the declaration expires on 19 November 2018;
• The Treasure's decision (as of 27 October 2008) to declare the service provided by the Hamersley Rail Network for a period of 20 years be set aside; and
• The Treasurer's decision (as of 27 October 2008) to declare the service provided by the Goldsworthy Railway for a period of 20 years be affirmed.[18]

2.91      Due to the concerns expressed previously by the NCC, the Government amended the Trade Practices Act 1974. The amendments increase regulatory certainty and streamline administrative processes associated with the National Access Regime.

2.92      During the 2009–2010 financial year, the Council considered three applications relating to the regulation of access to the natural gas pipelines under the National Gas Law (NGL) and National Gas Rules (NGR). Each of the applications was approved.

Productivity Commission (PC)

Reporting requirements

2.93      The committee considers that PC has met its reporting requirements under the Act.

Operational matters

2.94      The annual report contains an article Good public policy–why evidence and process matter, highlighting a core focus of the Commission during the 2009–2010 financial year.

2.95      Other highlights include: the release of a report Overcoming Indigenous Disadvantage; an invitation to present their findings at COAG; the receipt of a Government request to report every two to three years on the economic impacts and benefits of COAG's agreed reform agenda; a roundtable conference on evidence-based policy making; and the completion of a number of supporting research projects.

Reserve Bank of Australia (RBA)

Reporting requirements

2.96      The committee considers that the Reserve Bank has met its reporting requirements under the Act.

2.97      The committee notes the absence of a Compliance Index and suggests one should be included in future annual reports.

Operational matters

2.98      The annual report notes the improved economic conditions during 2009–2010. In the gradually improving economic environment, the extraordinary measures introduced during 2008 to assist the local economy were gradually withdrawn.

2.99      It is also noteworthy that '[t]he provision of additional liquidity, which had seen the Reserve Bank's balance sheet nearly double in size, had largely been unwound by the end of June 2009'.[19]

2.100         Due to the high value of the Australian dollar during 2009–10, the Reserve Bank recorded a loss in its earnings. The Reserve Bank reports that:

The valuation loss arising mainly from the rise in the exchange rate amounted to $3.8 billion, which was the largest loss, in absolute terms, the Bank has ever experienced.

It also noted that:

Underlying earnings–at $866 million in 2009/10–were also lower than normal because of the low level of global interest rates. The total loss, measured in terms of the accounting standards, came to $2.9 billion.

Royal Australian Mint (RAM)

Reporting requirements

2.101         The committee considers that the RAM has met its reporting requirements under the Act.

Operational matters

2.102         There was an increase in 2009–10 in circulating coin production in an effort to meet circulating coin demand as well as the Government's required buffer stock levels.

2.103         The Mint returned a lower seigniorage amount this financial year due to a decreased demand for circulating coin.

2.104         The newly refurbished gallery was open to visitors during the financial year.

Takeovers Panel (TP)

Reporting requirements

2.105         The committee considers that the Takeovers Panel has met its reporting requirements under the Act.

2.106         The committee commends the Panel for their Compliance Index.

Operational matters

2.107         During the year, the Panel resolved a number of issues relating to takeover bids. This included: Bowen Energy 02 & 02R; Multiplex Prime Property Fund 01-04; Tully Sugar Limited; Macarthur Coal Limited; and the examination of a number of applications relating to rights issues.

2.108         A consultation draft of the Procedural Rules was released by the Panel on 1 October 2009. Five submissions were received and the Panel adopted new Procedural Rules, which came into effect on 1 June 2010.

2.109          At the time of the publication of the annual report, the Panel was in the process of reviewing submissions for a consultation paper on proposed:

• Updated GN 1 Unacceptable Circumstances; and
• Draft Guidance Note on Recommendations and Undervalue Statements, to assist the market with guidance following a couple of recent Panel matters involving target board recommendations.

Committee's concluding remarks

The committee commends the departments and statutory bodies on the overall quality and comprehensiveness of the annual reports. The committee also notes that the annual reports examined in this chapter provide adequate details of audited financial statements. However, the committee suggests that Commonwealth bodies take note of the Prime Minister and Cabinet's annual report requirements and ensure that a 'clear read' exists between PB Statements and annual reports.[20] This coherence ensures the integrity of the accountability system, particularly as it relates to the comparing of budget and performance information.

 

Senator Mark Bishop

Chair

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