Statement of Intent 2005-2009

• Ministerial Statement
• Part 1: Outcomes, Objectives and Strategies

• Part 2: Forecast Financial Statements

• Part 3 Other Information

Part 2: Forecast Financial Statements

PART 2 Forecast Financial Statements

The Minister for Arts, Culture and Heritage is the Responsible Minister for the Ministry for Culture and Heritage.

Statement of responsibility

The forecast financial statements for the Ministry for Culture and Heritage for the year ending 30 June 2006 contained in this report have been prepared in accordance with section 38 of the Public Finance Act 1989.

The Chief Executive of the Ministry for Culture and Heritage acknowledges, in signing this statement, that he is responsible for the forecast financial statements contained in this report.

The financial performance forecast to be achieved by the Ministry for the year ending 30 June 2006, specified in the statement of forecast financial performance on page 23, is as agreed with the Minister for Arts, Culture and Heritage who is the Minister responsible for the financial performance of the Ministry for Culture and Heritage.

The service performance for the departmental outputs forecast to be achieved by the Ministry for the year ending 30 June 2006, specified in the statement of forecast service performance on pages 24-29, are as agreed with the Minister for Arts, Culture and Heritage and the Minister for Sport and Recreation, who are responsible for the Votes administered by the Ministry.

We certify that the information contained in this report is consistent with existing appropriations, and with the appropriations set out in the Appropriation (2005/06 Estimates) Bill.

Signed

MARTIN MATTHEWS
Chief Executive
11 April 2005

Countersigned

MATTHEW ARCHER
Manager Corporate Services
11 April 2005

Forecast Statement of Financial Performance for the Year Ending 30 June 2006

	2004/05	2004/05	2005/06
	Budgeted [1]	Estimated Actual	Budget
	$000	$000	$000
Revenue
Crown	10,567	10,567	11,917
Department	229	229	101
Other	179	179	275
Total Revenue	10,975	10,975	12,293
Expenses
Output Expenses:
Personnel	5,776	5,776	5,829
Operating	4,797	4,797	5,907
Depreciation	336	336	462
Capital charge	66	66	95
Total Output Expenses	10,975	10,975	12,293
Net Surplus/(Deficit)	0	0	0

This statement is to be read in conjunction with the accompanying Statement of Significant Accounting Policies.

[1.] This column incorporates both Main Estimates and Supplementary Estimates appropriations for 2004/05.

Forecast Statement of Financial Position as at 30 June 2006

	Actual Financial Position as at 30 June 2004	Budgeted Financial Position 2004/05	Estimated Financial Position as at 30 June 2005	Forecast Financial Position as at 30 June 2006
	$000	$000	$000	$000
Assets
Current Assets
Cash and bank balances	874	817	817	1,179
Debtors and receivables	123	70	70	70
Total Current Assets	997	887	887	1,249
Non-Current Assets
Fixed Assets [2]	1,026	790	790	1,139
Total Non-Current Assets	1,026	790	790	1,139
Total Assets	2,023	1,677	1,677	2,388
Liabilities
Current Liabilities
Creditors and payables	680	521	521	521
Provision for payment of surplus to the Crown	90	0	0	0
Deferred revenue	91	0	0	0
Provision for employee entitlements	256	250	250	250
Total Current Liabilities	1,117	771	771	771
Term Liabilities
Provision for employee entitlements	80	80	80	80
Total Term Liabilities	80	80	80	80
Total Liabilities	1,197	851	851	851
Taxpayers' Funds
General funds	826	826	826	1,537
Revaluation reserve	-	-	-	-
Total Taxpayers' Funds	826	826	826	1,537
Total Liabilities and Taxpayers' Funds	2,023	1,677	1,677	2,388

This statement is to be read in conjunction with the accompanying Statement of Significant Accounting Policies.

[2.] Further details of Fixed Assets are contained in the table on page 22 of this document.

Forecast Statement of Cash Flows for the Year Ending 30 June 2006

	2004/05 Budgeted $000	2004/05 Estimated Actual $000	2005/06 Budget $000
Cash Flows from Operating Activities
Cash provided from:
- Supply of outputs to:
Crown	10,608	10,608	11,917
Other	329	329	376
Cash disbursed to:
- Cost of producing outputs:
Personnel and operating expenses	(10,738)	(10,738)	(11,736)
Capital charge	(66)	(66)	(95)
Net Cash Flows from Operating Activities	133	133	462
Cash Flows from Investing Activities
Cash provided from:
- Sale of physical assets	-	-	-
Cash disbursed to:
- Purchase of physical assets	(100)	(100)	(811)
Net Cash Flows from Investing Activities	(100)	(100)	(811)
Cash Flows from Financing Activities
Cash provided from:
- Capital contributions	-	-	711
Cash disbursed to:
- Payment of surplus to the Crown	(90)	(90)	-
Net Cash Flows from Financing Activities	(90)	(90)	711
Net Increase/(Decrease) in Cash Held	(57)	(57)	362
Opening Total Cash Balances at 1 July	874	874	817
Closing Total Cash Balances at 30 June projected	817	817	1,179

This statement is to be read in conjunction with the accompanying Statement of Significant Accounting Policies.

Reconciliation of Net Cash Flows from Operating Activities to Net Surplus/(Deficit) in the Forecast Statement of Financial Performance for the Year Ending 30 June 2006

	2004/05 Budgeted $000	2004/05 Estimated Actual $000	2005/06 Budget $000
Operating Surplus/(Deficit)	-	-	-
Add/(deduct) non-cash expenses/(revenues):
Depreciation	336	336	462
Add/(deduct) movements in working capital:
(Increase)/decrease in debtors and receivables	53	53	-
Increase/(decrease) in creditors and payables	(165)	(165)	-
Increase/(decrease) in deferred income	(91)	(91)	-
Add/(deduct) investing activity items:
Net (gain)/loss on sale of fixed assets	-	-	-
Net Cash Flows from Operating Activities	133	133	462

This statement is to be read in conjunction with the accompanying Statement of Significant Accounting Policies.

Forecast Statement of Movements in Taxpayers' Funds (Equity) for the Year Ending 30 June 2006

	Budgeted Position 2004/05 $000	Forecast Position as at 30 June 2005 $000	Forecast Position as at 30 June 2006 $000
Taxpayers' Funds at start of period	826	826	826
Net surplus/(deficit) for year	-	-	-
Increase/(decrease) in revaluation reserve	-	-	-
Total recognised revenues and expenses for the period	-	-	-
Capital contributions from the Crown for the development of a cultural web portal	-	-	711
Provision for payment of surplus to the Crown	-	-	-
Total adjustments for flows to and from the Crown	-	-	711
Asset/liability transfers between departments	-	-	-
Taxpayers' Funds at end of period	826	826	1,537

This statement is to be read in conjunction with the accompanying Statement of Significant Accounting Policies.

Forecast Details of Fixed Assets by Category as at 30 June 2006

	2004/05 Budgeted Position Net Book Value	30 June 2005 Estimated Position Net Book Value	30 June 2006 Forecast Position Cost Depreciation	30 June 2006 Forecast Position Accumulated	30 June 2006 Forecast Position Net Book Value
	$000	$000	$000	$000	$000
Computer hardware	168	168	494	338	156
Computer software	101	101	924	308	616
Leasehold improvements	411	411	727	417	310
Office equipment	38	38	118	97	21
Office furniture	52	52	308	292	16
Works of art	20	20	20	-	20
Total	790	790	2,591	1,452	1,139

Statement of Forecast Financial Performance for the Ministry for the Year Ending 30 June 2006

Performance Indicators: 2004/05 and 2005/06

	Unit	2004/05	2004/05	2005/06
		Budgeted	Estimated Actual	Budget
Operating Results
Revenue – other	$000	408	408	376
Output expenses	$000	10,975	10,975	12,293
Operating surplus before capital charge	$000	66	66	95
Net surplus	$000	-	-	-
Working Capital
Net current assets 3	$000	116	116	478
Current ratio 4	%	115	115	162
Average creditors outstanding	days	30	30	30
Resource Utilisation
Physical assets:
- Total physical assets at year-end	$000	790	790	1,139
- Value per employee	$000	10	10	13
- Additions as percentage of physical assets	%	13	13	71
Taxpayers' funds:
- Level at year-end	$000	826	826	1,537
- Level per employee	$000	10	10	18
Forecast Net Cash Flows
Surplus/(deficit) operating activities	$000	133	133	462
Surplus/(deficit) investing activities	$000	(100)	(100)	(811)
Surplus/(deficit) financing activities	$000	(90)	(90)	711
Net increase/(decrease) in cash held	$000	(57)	(57)	362
Human Resources
Total staff	number	80	80	85

3. Current assets minus current liabilities.
4. Current assets as a proportion of current liabilities.

Statement of Forecast Service Performance for Each Departmental Output for the Year Ending 30 June 2006

The Ministry for Culture and Heritage has committed itself to provide in 2005/06 departmental outputs which meet the requirements of its Vote Ministers in terms of their nature, timeliness, quality and quantity specifications, and cost.

Forecast Service Performance

Departmental outputs to be delivered by the Ministry for Culture and Heritage, and their associated revenue, expenses and surplus or deficit are summarised below.

Departmental Output	Revenue: Crown $000	Revenue: Depts $000	Revenue: Other $000	Total Expenses Appropriated $000	Surplus/ (Deficit) $000
Vote Arts, Culture and Heritage
Heritage services	4,382	46	275	4,703	-
International cultural diplomacy	2,089	-	-	2,089	-
Policy advice and grants administration	5,348	55	-	5,403	-
Vote Sport and Recreation
Purchase advice and monitoring of sport and recreation Crown entities	98	-	-	98	-
Aggregate totals in Statement of Financial Performance	11,917	101	275	12,293	-

Output Descriptions and Forecast Non-Financial Service Performance

Vote Arts, Culture and Heritage

Output – Heritage services

Quantity, Quality and Timeliness

The following performance measures and standards apply to this output:

Historical publications and administrative services

Performance targets for historical publications and administrative services are:

Dictionary of New Zealand Biography (DNZB)

• Electronic publication of DNZB Volumes I–V will be maintained by two updates.

Te Ara, the online encyclopedia of New Zealand

• Four regional entries of the ‘Places' theme of Te Ara will be launched by 31 December 2005.
• The ‘Earth, Sea and Sky' theme will be launched by 30 June 2006.

New Zealand history

• Undertake at least 20 historical projects (seven projects will be completed during the year).
• 80% of historical projects completed meet time criteria.
• 100% of historical projects completed meet content criteria.
• Publish at least two new features on www.NZHistory.net.nz.
• 80% of NZHistory.net.nz features completed meet time criteria.
• 100% of NZHistory.net.nz features completed meet content criteria.

Heritage property management

Performance targets for the management of national monuments and war graves are:

• 4,188 war graves, 80 historic graves and 16 national monuments will be maintained in accordance with the agreed programme.
• The National War Memorial and five overseas war memorials will be managed and maintained in accordance with the agreed programme.
• All site inspections to determine necessary maintenance will be undertaken in accordance with an agreed schedule.
• At the conclusion of scheduled maintenance all sites will be in a good state of repair with inscriptions legible and stonework intact.
• 90% of all contracts over $1,000 for capital works and maintenance within New Zealand will comply with agreed criteria as set out in the 2005/06 Output Plan.
• Special projects will be managed in accordance with the agreed programme.

Symbols of New Zealand sovereignty

The performance target for the administration of legislation associated with the protection of New Zealand identity (sovereignty) is:

• 100% of submissions to Minister in relation to the Flags, Emblems and Names Protection Act 1981 will be accepted.

Commemorating Waitangi Day Fund

The performance target for the fund is:

• No justified complaints will be received concerning administration of the fund.

Administering the Government Exhibition Indemnification Scheme

• An estimated five indemnifications will be established and administered during the year.
• 100% of indemnifications established and administered will meet the timing requirements of the applicant.
• 100% of indemnifications will comply with the policy guidelines for the scheme.

Antiquities Act

Performance targets for the administration of the Antiquities Act 1975 are:

• 150 (the estimated range is 120 to 180) applications made under the Antiquities Act 1975 completed:
  • an estimated 50 export certificates for antiquities will be issued (estimated range 40 to 60)
  • an estimated 50 determinations on the custody of newly found artefacts will be made (estimated range 40 to 60)
  • an estimated 50 collectors of artefacts will be registered (estimated range 40 to 60)
• No decisions will be overturned through the appeal process.

Output – International cultural diplomacy

Quantity, Quality and Timeliness

The following performance measures and standards apply to this output:

• The approved projects will be funded and completed on time and within the approved budget.
• An estimated five briefing reports will be provided to Ministers on the overall programme of activity and allocation of funding for individual cultural diplomacy projects.
• An estimated three briefing reports will be provided to the Minister reporting on progress in implementing the programme and outcomes of funded activity.
• The cross-agency steering group will rate the Ministry's management of the programme as good or better.

Output – Policy advice and grants administration

Quantity, Quality and Timeliness

The following performance measures and standards apply to this output:

Policy advice

Performance targets for policy advice are:

Briefing reports

An estimated 280 briefing reports will be provided during the year to Ministers on significant issues in the arts, culture, heritage and broadcasting sectors, developments in the portfolios, and relevant policy proposals by other departments.

• 100% of briefing reports will meet the deadlines set by the Ministers' offices.
• Ministers will rate, on an annual basis, the Ministry's performance in regard to briefing reports provided as good or better.

Submissions to Cabinet/Cabinet Committees

• An estimated 35 Cabinet or Cabinet Committee submissions will be provided during the year to Ministers.
• 100% of submissions will meet Cabinet Office deadlines.
• An estimated 75 Cabinet or Cabinet Committee submissions of other government departments will be contributed to.
• Ministers will rate, on an annual basis, the Ministry's performance in regard to submissions to Cabinet/Cabinet Committees provided as good or better.

Sets of speech notes

• An estimated 90 sets of speech notes will be provided during the year to Ministers.
• 100% of sets of speech notes will meet the deadlines set by the Ministers' offices.
• Ministers will rate, on an annual basis, the Ministry's performance in regard to sets of speech notes provided as good or better.

Grants administration

Performance targets for grants administration are:

• Crown payments for Non-Departmental Output Expenses, Other Expenses, and Capital Contributions will be disbursed to at least 20 organisations during the year. All payments will be made in accordance with instructions and conditions governing payment.
• The performance of recipients of Crown payments will be specified in memoranda of understanding or other funding arrangements agreed to by the responsible Ministers. All agreements will be completed by 31 July 2005, unless a formal extension is agreed to by the relevant Minister.
• An estimated 140 briefing reports on agency performance and issues related to agency operations will be provided during the year to Ministers.
• Advice and assistance to recipients of Crown payments will be provided as required.
• Advice provided will be rated as satisfactory or better by 90% of respondents.

Ministerial servicing

Performance targets for ministerial servicing are:

Ministerial correspondence

• An estimated 500 draft replies to ministerial correspondence will be provided during the year.
• Unless otherwise agreed with Ministers, 90% of draft replies will be provided within 15 working days of receipt.
• Unless otherwise agreed with Ministers, 100% of draft replies will be provided within 20 working days of receipt.
• Ministers will rate, on an annual basis, the Ministry's performance in regard to draft replies to ministerial correspondence provided as good or better.

Questions in the House

• An estimated 150 draft responses to questions in the House will be provided during the year.
• 100% of draft responses will meet the deadlines set by the Ministers' offices.
• Ministers will rate, on an annual basis, the Ministry's performance in regard to draft responses to questions in the House provided as good or better.

Vote Sport and Recreation

Output – Purchase advice and monitoring of sport and recreation Crown entities

Quantity, Quality and Timeliness

The following performance targets apply to this output:

• An estimated 10 briefing reports will be provided during the year.
• Crown payments for Non-Departmental Output Expenses, Benefits and Other Unrequited Expenses, and Other Crown Expenses will be disbursed to at least two organisations during the year. All payments will be made in accordance with instructions and conditions governing payment.
• The performance of recipients of Crown payments will be specified in memoranda of understanding or other funding arrangements agreed to by the Minister. All agreements will be completed by 31 July 2005, unless a formal extension is agreed to by the Minister.
• Advice and assistance to recipients of Crown payments will be provided as required.
• Advice provided will be rated as satisfactory or better by all respondents.
• The Minister will rate, on an annual basis, the Ministry's performance in regard to purchase advice and monitoring provided as good or better.

Statement of Significant Underlying Assumptions

The Ministry for Culture and Heritage is a government department as defined by section 2 of the Public Finance Act 1989.

These forecast financial statements have been prepared in accordance with Section 38 of the Public Finance Act 1989.

These statements have been compiled on the basis of government policies and the Ministry's output agreement with the Minister for Arts, Culture and Heritage and the Minister for Sport and Recreation at the time the statements were finalised.

These statements comply with generally accepted accounting practice. The measurement base applied is historical cost.

The accrual basis of accounting has been used for the preparation of these statements.

These statements have been prepared on a going-concern basis.

Statement of Significant Accounting Policies

Specific accounting policies

Fixed assets

All fixed assets costing $1,000 or more are capitalised (except for computer equipment where the threshold has been set at $2,000 and software licencing and development costs where the threshold has been set at $5,000) and recorded at historical cost less accumulated depreciation.

The initial cost of a fixed asset is the value of the consideration given to acquire or create the asset and any directly attributable costs of bringing the asset to working condition for its intended use. Leasehold improvement costs include significant project management and related fees.

Depreciation rates

Depreciation is provided on a straight-line basis as follows:

	% per annum
Office furniture	20
Computer equipment and software
- Personal computers	33 1/3
- Computer equipment other than personal computers	25
- Software licensing and development costs	33 1/3
Office equipment	20
Works of art	1

Leasehold improvements are depreciated over the unexpired period of the lease or the estimated useful lives of the improvements, whichever is shorter. Consequently, the depreciation rate for each asset will vary depending upon the lease period or the useful life of the improvements when work is completed.

Items under construction are not depreciated. The total cost of a capital project is transferred to the appropriate asset class on its completion and then depreciated.

Cost allocation

The Ministry has derived the costs of outputs shown in these statements using a cost-allocation system which assigns direct costs to outputs and indirect costs to outputs based on staff numbers.

Goods and Services Tax

All revenue, expenditure and assets and liabilities except Debtors and Creditors are recorded exclusive of GST.

Income tax

Government departments are exempt from the payment of income tax in terms of the Income Tax Act 1994. Accordingly, no charge for income tax has been provided for.

Debtors

Debtors are recorded at estimated realisable value, after providing for doubtful and uncollectable debts.

Provision for employee entitlements

Provision is made in respect of the Ministry's liability for annual, long service and retirement leave. Annual leave has been calculated on an actual entitlement basis at current rates of pay. Long service leave has been calculated on an actuarial basis based on the present value of expected future entitlements. Retirement leave has been calculated on a proportion-of-entitlement basis at current rates of pay. Entitlements expected to be settled within 12 months of reporting date are recognised as current liabilities in the Statement of Financial Position.

Revenue

The Ministry derives revenue through the provision of outputs to the Crown and from services to third parties. Third-party revenue is predominantly derived through the undertaking of historical projects on a full cost-recovery basis. Revenue is recognised when earned and is reported in the financial period to which it relates.

Statement of Cash Flows

Cash means cash balances on hand and held in bank accounts.

Operating activities include cash received from all income sources of the Ministry and record the cash payments made for the supply of goods and services.

Investing activities are those activities relating to the acquisition and disposal of non-current assets.

Financing activities comprise capital injections by, or repayment of capital to, the Crown.

Changes in accounting policies

There have been no changes in accounting policies during the period.

Page last updated: May 8, 2006

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