Note 19: Explanation of major variances against budget

Explanations for major variances from the Office's forecast figures in the Annual Plan 2008/09 are as follows:

Statement of financial performance

Audit fee revenue and other income was lower than forecast, mainly because contracted audit service providers were less advanced with the completion of audits at 30 June 2009 than had been forecast.

Personnel costs were higher than forecast, mainly because of more contract staff being required to help complete LTCCP work than was forecast.

Operating costs were lower then forecast, mainly because contracted audit service providers were less advanced with the completion of audits at 30 June 2009 than had been forecast.

Depreciation and amortisation expense was lower than forecast because the forecast included replacement of information systems that did not actually occur during the year.

The capital charge expense was higher than forecast because the actual expense is stated gross, whereas the forecast capital charge expense was stated net of interest revenue.

Statement of financial position

The cash balance was lower, and receivables and work in progress higher than forecast because of a delay in invoicing and receiving payment for audit services.

The creditors and other payables balance was lower than forecast because of accounts being paid earlier then forecast.

The higher employee entitlements relates to increased annual leave entitlements because of an increase in staff numbers and staff taking less leave than forecast.

Statement of cash flows

The differences in operating items all relate to the Statement of financial position items noted above.