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Department for Correctional Services Department for Correctional Services Financial report for the year ended 30 June 2019 INDEPENDENT AUDITOR'S REPORT Government of Sout h Aust ralia Auditor-General's Department Level 9 State Administration Centre 200 Victoria Square Adelaide SA 5000 DX 56208 Victoria Square Tel +618 8226 9640 Fax +618 8226 9688 ABN 53 327 061 410 [email protected] www.audit.sa.gov.au To the Chief Executive Department for Correctional Services As required by section 31 (1 )(b) of the Public Finance and Audit Act 198 7, I have audited the financial report of the Department for Correctional Services for the financial year ended 30 June 2019. Opinion In my opinion, the accompanying financial report gives a true and fair view of the financial position of the Department for Correctional Services as at 30 June 2019, its financial performance and its cash flows for the then year ended in accordance with the Treasurer's Instructions promulgated under the provisions of the Public Finance and Audit Act 1987 and Australian Accounting Standards. The financial report comprises: • a Statement of Comprehensive Income for the year ended 30 June 2019 a Statement of Financial Position as at 30 June 2019 a Statement of Changes in Equity for the year ended 30 June 2019 • a Statement of Cash Flows for the year ended 30 June 2019 • notes, comprising significant accounting policies and other explanatory information a Certificate from the Chief Executive and the Executive Director, People and Business Services. Basis for opinion I conducted the audit in accordance with the Public Finance and Audit Act 1987 and Australian Auditing Standards. My responsibilities under those standards are further described in the 'Auditor's Responsibilities for the audit of the financial report' section of my report. I am independent of the Department for Correctional Services. The Public Finance and Audit Act 1987 establishes the independence of the Auditor-General. In conducting the audit, the relevant ethical requirements of APES 110 Code ofEthics for Professional Accountants have been met. I believe that the audit evidence obtained is sufficient and appropriate to provide a basis for myop1mon. Responsibilities of the Chief Executive for the financial report The Chief Executive is responsible for the preparation of the financial report that gives a true and fair view in accordance with the Treasurer's Instructions issue under the provisions of the Public Finance and Audit Act 1987 and Australian Accounting Standards, and for such internal control as management determines is necessary to enable the preparation of the financial report that gives a true and fair view and that is free from material misstatement, whether due to fraud or error. Auditor's responsibilities for the audit of the financial report My objectives are to obtain reasonable assurance about whether the financial report as a whole is free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes my opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing Standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of this financial report. As part of an audit in accordance with Australian Auditing Standards, I exercise professional judgement and maintain professional scepticism throughout the audit. I also: identify and assess the risks of material misstatement of the financial report, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for my opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control • obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Department for Correctional Services' internal control evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the Chief Executive evaluate the overall presentation, structure and content of the financial report, including the disclosures, and whether the financial report represents the underlying transactions and events in a manner that achieves fair presentation. My report refers only to the financial report described above and does not provide assurance over the integrity of electronic publication by the entity on any website nor does it provide an opinion on other information which may have been hyperlinked to/from the report. I communicate with the Chief Executive about, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in ~internal control that I identify during the audit. Andrew Richardson Auditor-General 16 September 2019 Certification of the Financial Statements We certify that the attached general purpose financial statements for the Department for Correctional Services: • comply with relevant Treasurer's Instructions issued under section 41 of the Public Finance and Audit Act 1987, and relevant Australian Accounting Standards; • are in accordance with the accounts and records of the Department; and • present a true and fair view of the financial position of the Department for Correctional Services as at 30 June 2019 and the results of its operation and cash flows for the financial year. We certify that the internal controls employed by the Department for Correctional Services for the financial year over its financial reporting and its preparation of the general purpose financial statements have been effective throughout the reporting period. David Brown Chief Executive Services 9 September 2019 J' September 2019 Department for Correctional Services Statement of Comprehensive Income For the year ended 30 June 2019 2019 2018 Note $'000 $'000 Expenses Employee benefit expenses 2.3 225 590 224 474 Supplies and services 3.1 100 961 94192 Depreciation and amortisation 3.2 21 632 20 681 Accommodation and associated lease costs 12 443 12 163 Payments to prisoners 4 309 4227 Grants 292 626 Net loss from disposal of non-current assets 4.6 2 098 Impairment loss on receivables 320 Other expenses 3.3 845 851 Total expenses 368 490 357 214 Income Prison labour 4.2 5 802 5194 Resources received free of charge 4.5 2147 2 058 Salaries and goods and services recoups 1 957 1 933 Interest revenue 1 Commonwealth grants and payments 4.3 767 767 Canteen and kitchen sales 4.4 1 004 1 126 Net gain from the disposal of non-current and other assets 4.6 10 Other income 4.7 2467 2489 Total income 14144 13 578 Net cost of providing services 354 346 343 636 Revenues from I (payments to) SA Government: Revenues from SA Government 4.1 356 544 362 041 Payments to SA Government 4.1 (37 368} Net result 2198 (18 963) Other comprehensive income Items that will not be reclassified to net result Changes in revaluation surplus 5.1 60 384 11 399 Total comprehensive result 62 582 (7 564) The accompanying notes form part of these financial statements. The net result and total comprehensive result are attributable to the SA Government as owner. Department for Correctional Services Statement of Financial Position As at 30 June 2019 2019 2018 Note $'000 $'000 Current assets Cash and cash equivalents 6.1 19 573 28 063 Receivables 6.2 4 498 4 503 Inventory 5.5 1 896 1 844 Total current assets 25 967 34 410 Non-current assets Property, plant and equipment 5.1 671 442 571 768 Capital works in progress 5.2 39 029 52 553 Intangible assets 5.3 2 593 2 593 Biological assets 5.4 414 350 Total non-current assets 713 478 627 264 Total assets 739 445 661 674 Current liabilities Payables 7.1 23732 23 062 Employee benefits 2.4 28 874 21 241 Provisions 7.2 3 311 3 118 Total current liabilities 55 917 47 421 Non-current liabilities Payables 7.1 3 552 3120 Employee benefits 2.4 37108 32 418 Provisions 7.2 26 714 25 049 Total non-current liabilities 67 374 60 587 Total liabilities 123 291 108 008 Net assets 616154 553 666 Equity Retained earnings 8.1 68177 66 061 Prisoner amenities reserve 8.1 201 213 Asset revaluation surplus 8.1 382 308 321 924 Contributed capital 8.1 165 468 165 468 Total equity 616 154 553 666 The accompanying notes form part of these financial statements. The total equity is attributable to the SA Government as owner. Department for Correctional Services Statement of Changes in Equity For the year ended 30 June 2019 Prisoner Asset Contributed Retained Total amenities revaluation capital earnings equity reserve surplus Note $'000 $'000 $'000 $'000 $'000 Balance at 1 July 2017 126 310 525 145 305 85 111 541 067 Net result for 2017-18 (18 963) (18 963) Gain on revaluation of land and buildings during 2017-18 11 394 11 394 Gain on revaluation of olives & citrus grove during 2017-18 5 5 Total comprehensive result for 2017- 18 11 399 (18 963} (7 564} Net changes in reserves 87 87 Transactions with SA Government as owner: Capital contribution received 20 163 20 163 Balance at 30 June 2018 8.1 213 321 924 165 468 66 061 553 666 Adjustments on initial adoption of AASB9 (94} (94} Adjusted balance at 1 July 2018 213 321 924 165 468 65 967 553 572 Net result for 2018-19 2 198 2 198 Gain on revaluation of land and buildings during 2018-19 60 104 60104 Gain on revaluation of olives & citrus grove during 2018-19 280 280 Total comprehensive result for 2018- 19 60 384 2 198 62 582 Net changes in reserves 12 12 Transactions with SA Government as owner: Balance at 30 June 2019 8.1 201 382 308 165 468 68 177 616 154 The accompanying notes form part of these financial statements.
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