Note 5: Other operating costs
Accounting policy
Expenses of audit service providers
Fees for audits of public entities carried out by contracted audit service providers are recognised as the work progresses, based on advice from the contracted audit service providers. Contracted audit service providers invoice and collect audit fees directly from public entities.
Operating leases
An operating lease is a lease that does not transfer substantially all the risks and rewards incidental to ownership of an asset. Lease payments under an operating lease are recognised as an expense on a straight-line basis over the lease term. Lease incentives received are recognised in the surplus or deficit as a reduction of rental expense over the lease term. All leases entered into by the Office are operating leases.
Breakdown of other operating costs
| Actual 2015/16 $000 | Actual 2014/15 $000 | Main Estimates 2015/16 $000* | Main Estimates 2016/17 $000* | |
|---|---|---|---|---|
| Provision for impairment of receivables | 27 | - | - | - |
| Fees to auditors for the audit of the Office's financial statements (from 2016: PKF Goldsmith Fox Audit, 2015: CST Nexia) | 90 | 98 | 110 | 108 |
| Operating lease payments | 2,451 | 2,399 | 2,593 | 2,691 |
| Fees for audits of public entities carried out by PKF Goldsmith Fox Audit (2015: CST Nexia)** | 7 | 126 | 128 | 7 |
| Fees for audits of public entities carried out by other contracted audit service providers** | 34,698 | 33,237 | 32,063 | 32,817 |
| Other expenses | 8,582 | 8,978 | 8,717 | 7,690 |
| Total other operating costs | 45,855 | 44,838 | 43,611 | 43,313 |
* All Estimates information is unaudited.
** Expenditure relating to audits carried out by contracted audit service providers does not involve any cash transactions with the Office.