Direction under section 32, Financial Management and Accountability Act 1997 - Adjustments of Appropriations on Change of Agency Functions (No. 1 of 2004-2005)

Overview

The Financial Management and Accountability Act 1997 was enacted to strengthen financial management and accountability in the Commonwealth public sector, addressing a need for more rigorous oversight and transparency in the allocation and use of public funds. This Act was introduced by the Parliament of Australia to ensure that public money is managed effectively and efficiently, and to provide a framework for accountability in financial matters across the Commonwealth. The policy objective of the Act is to establish a robust system of financial management that supports the delivery of government services while maintaining public trust through transparency and accountability. Pursuant to this Act, the Director, through Brett Kaufmann, Acting Division Manager, Financial Reporting and Cash Management Division, Department of Finance and Administration, has the authority to direct the transfer of specified funds between agencies as necessary to ensure compliance with the Act's requirements and to support the effective management of public resources.

Scope and Application

The Financial Management and Accountability Act 1997 provides the framework for financial management and accountability within Australian public sector entities. This particular legislative instrument, issued under section 32 of the Act, pertains specifically to the transfer of funds between different agencies within the public sector. The directive applies to the entities listed in the schedule, specifically the Department of the House of Representatives as the 'old agency' and the Department of Parliamentary Services as the 'new agency', and involves the transfer of specific appropriations as identified in the attached schedule. The geographic or jurisdictional reach of this directive is limited to the Commonwealth level, impacting only the specified departments within the Australian government. There are no exclusions, exemptions, or thresholds mentioned in this directive, but it is worth noting that the Act itself may extend or restrict application through subordinate instruments, which are not detailed in this specific legislative instrument.

Key Provisions

The primary operative section of this legislation, section 32 of the Financial Management and Accountability Act 1997, authorises the specified transfer of funds between agencies as outlined in the attached schedule (section 32). In this instance, the Acting Division Manager, Financial Reporting and Cash Management Division, Department of Finance and Administration, Brett Kaufmann, is directing the transfer of specified appropriations from the Department of the House of Representatives to the Department of Parliamentary Services. This transfer includes an appropriation from the "Appropriation (Parliamentary Departments) Act (No. 1) 2004-2005" amounting to $9,778,000 and a non-lapsing appropriation from prior years amounting to $2,240,000. The Act imposes specific obligations on the entities involved in the transfer of funds. The Acting Division Manager must ensure that the funds are transferred accurately and in accordance with the legislative requirements. This includes ensuring that the 'old agency' has the authority to transfer the specified funds and that the 'new agency' has the capacity to receive and utilise those funds appropriately. Furthermore, the Department of Finance and Administration is responsible for maintaining records and providing documentation to support the financial transactions, ensuring compliance with financial management and accountability standards. Breaches of the provisions outlined in this legislation can lead to serious consequences. Under the Financial Management and Accountability Act 1997, improper handling of funds or failure to comply with the transfer directives can result in both civil and criminal penalties. The exact penalties depend on the nature and severity of the breach but can include fines and, in more severe cases, imprisonment. The maximum penalties for breaches involving mismanagement of public funds can be significant, reflecting the seriousness with which the law treats the misuse of public resources. Compliance with the Act is, therefore, crucial to avoid these severe repercussions.