Finance Minister’s Amendment Orders (Financial Statements for reporting periods ending on or after 1 July 2011)

Administered by Department of Finance

Legislation au F2012L01600 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by the authority of the Minister for Finance and Deregulation

Financial Management and Accountability Act 1997 and Commonwealth Authorities and Companies Act 1997

Finance Minister’s Amendment Orders (Financial Statements for reporting periods ending on or after 1 July 2011)

 

 

Financial Management and Accountability Act 1997 (FMA Act)

Subsection 63(1) of the FMA Act provides that Orders may be made on any matter on which the FMA Act requires or permits Orders to be made and on any matter on which regulations under the FMA Act may be made. Section 49 of the FMA Act provides that the Chief Executive of an Australian Government Agency must prepare financial statements in accordance with Finance Minister’s Orders.  These requirements are currently specified in Schedule 1 to the Finance Minister’s Orders (Financial Statements for reporting periods ending on or after 1 July 2011) (FMOs).

Commonwealth Authorities and Companies Act 1997 (CAC Act)

Subsection 48(1) of the CAC Act provides that Orders may be made on any matter on which the CAC Act requires or permits Orders to be made.  Section 9 of the CAC Act requires the directors of a Commonwealth authority to prepare an annual report in accordance with Schedule 1 to the CAC Act.  Part 1 of Schedule 1 to the CAC Act provides that the annual report must include financial statements prepared by the directors in accordance with the Finance Minister’s Orders. These requirements are currently specified in Schedule 1 to the Finance Minister’s Orders (Financial Statements for reporting periods ending on or after 1 July 2011).

Other legislative provisions

The Finance Minister’s Orders are also made under the relevant provisions as set out below:

  • subsection 47(1) of the High Court of Australia Act 1979 in relation to how financial statements must be prepared by the High Court of Australia;
  • subsection 193H(1) of the Aboriginal and Torres Strait Islander Act 2005 in relation to how the accounts and financial statements must be prepared for the Land Account;
  • subsection 50B(4) of the Defence Service Homes Act 1918 in relation to how financial statements must be prepared by the Defence Service Homes Corporation; and
  • subsection 43(3) of the Natural Heritage Trust of Australia Act 1997 in relation to how financial statements must be prepared for the Natural Heritage Trust of Australia Account.

The Finance Minister’s Orders set out the financial statement reporting requirements for Australian Government entities for reporting periods ending on or after 1 July 2011.  

Specifics in relation to the Orders are as follows:

Finance Minister’s Orders (Financial Statements for reporting periods ending on or after 1 July 2011)

Clause 1 of the Orders deals with naming of the Orders.

Clause 2 of the Orders deals with commencement of the Orders.

Clause 3 inserts Schedule 1, which amends the requirements for the preparation of annual financial statements for reporting periods ending on or after 1 July 2011, and specifies the legislation to which it applies.

Changes in 2011-12

From 2011-12, the separate Financial Management and Accountability Orders (Financial Statements) and Commonwealth Authorities and Companies Orders (Financial Statements) prepared in previous years have been combined into a single legislative instrument.  This has no impact for preparers of financial statements.

Retrospectivity

The retrospective commencement date of this legislative instrument does not adversely affect the rights of persons or otherwise impose liabilities, other than onto the Commonwealth, and as such, does not contravene subsection 12 (2) of the Legislative Instruments Act 2003.
 

Consultation

 

Department of Finance and Deregulation (Finance) collaborated with entities that are affected as a result this amendment along with the Australian National Audit Office prior to the finalisation of the content of the amendment.

 

Attachments

Details of the main amendments to reporting requirements for the reporting periods ending on or after 1 July 2011, as compared to the requirements that were previously in force, are provided in Attachment A.

The Statement of Compatibility with Human Rights as required by the Human Rights (Parliamentary Scrutiny) Act 2011 is provided in Attachment B.

 

 

 

 

 

Attachment A to the Explanatory Statement

 

This attachment summarises the main amendments to the FMOs requiring the preparation of financial statements for reporting periods ending on or after 1 July 2011 for Australian Government entities.

 

Amendments to existing policies

  1. Division 7 Applicable Entities:  Clarified the scope of the requirement to prepare financial statements by replacing the word ‘entity’ with ‘agency and authority’.
  2. Division 44 Measurement and Disclosure of Post Employment Plans: Clarified the requirement to reference the market yield on Australian Government bonds when determining a discount rate.


Attachment B to the Explanatory Statement

 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Finance Minister’s Amendment Orders (Financial Statements for reporting periods ending on or after 1 July 2011)

  1. The proposed amendments do not engage any of the applicable rights or freedoms outlined in the Human Rights (Parliamentary Scrutiny) Act 2011, such as encompassed in the International Covenant on Civil and Political Rights.
  2. The proposed amendments do not limit any human rights, nor propose any offences or penalties. 
  3. This legislative instrument is therefore compatible with the human rights and freedoms recognised or declared in the international instruments listed in subsection 3(1) of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Penelope Ying Yen Wong, Minister for Finance and Deregulation

 

Overview

The Finance Minister’s Amendment Orders (Financial Statements for reporting periods ending on or after 1 July 2011), enacted in 2011, consolidate the financial statement reporting requirements for Australian Government entities into a single legislative instrument. Previously, two separate Orders—Financial Management and Accountability Orders (Financial Statements) and Commonwealth Authorities and Companies Orders (Financial Statements)—were used. This consolidation was aimed at streamlining financial reporting processes without affecting the rights of persons or imposing liabilities other than on the Commonwealth, as outlined in the Legislative Instruments Act 2003. The Orders, which apply to entities such as the High Court of Australia, Aboriginal and Torres Strait Islander Land Account, Defence Service Homes Corporation, and Natural Heritage Trust of Australia, were developed in consultation with relevant entities and the Australian National Audit Office. The amendments made under these Orders, including clarifying the scope of financial statement preparation and referencing the market yield on Australian Government bonds, do not engage any applicable rights or freedoms under the Human Rights (Parliamentary Scrutiny) Act 2011 and are thus compatible with human rights and freedoms recognised in international instruments.

Scope and Application

The Finance Minister’s Amendment Orders (Financial Statements for reporting periods ending on or after 1 July 2011) amalgamate and update the financial statement reporting requirements for various Australian Government entities, including agencies and authorities, under the Financial Management and Accountability Act 1997 and the Commonwealth Authorities and Companies Act 1997. These Orders apply to the Chief Executives of Australian Government agencies and the directors of Commonwealth authorities, mandating the preparation of financial statements in compliance with the specified legislative requirements. Additionally, they extend to other entities such as the High Court of Australia, the Defence Service Homes Corporation, and the Natural Heritage Trust of Australia, under various specified provisions of different Acts. The Orders are designed to ensure consistent and accurate financial reporting across these entities, enhancing accountability and transparency within the Commonwealth sector. The scope of application is broad, covering a range of Commonwealth-related entities, but does not extend to private or non-governmental entities. The Orders provide clarity and uniformity in financial statement preparation, effective from the specified reporting periods, ensuring that financial reporting aligns with contemporary regulatory standards and practices.

Key Provisions

The main sections of the Finance Minister’s Amendment Orders (Financial Statements for reporting periods ending on or after 1 July 2011) (F2012L01600) are contained in Clause 3, which amends the requirements for the preparation of annual financial statements for Australian Government entities. These Orders, issued under the authority of the Minister for Finance and Deregulation, aim to streamline the financial reporting requirements previously governed by separate legislative instruments. The key change is the consolidation of the Financial Management and Accountability Orders (Financial Statements) and the Commonwealth Authorities and Companies Orders (Financial Statements) into a single legislative instrument, effective for reporting periods ending on or after 1 July 2011. Under these Orders, Australian Government agencies and authorities are required to prepare financial statements in accordance with the specified guidelines set out in Schedule 1. This includes clarifying the scope of entities that must prepare financial statements by explicitly stating that the requirement applies to both agencies and authorities. Furthermore, these Orders clarify the measurement and disclosure of post-employment plans, particularly by referencing the market yield on Australian Government bonds when determining a discount rate. These changes aim to ensure consistency and clarity in financial reporting across the various Australian Government entities. The Orders impose obligations on the directors and Chief Executives of the affected entities to ensure that the financial statements are prepared in accordance with the prescribed guidelines. This includes adhering to the specific measurement and disclosure requirements outlined in the Orders. Entities must ensure that their financial statements are comprehensive, accurate, and comply with the legislative requirements. Non-compliance with these requirements may lead to scrutiny and potential penalties. While the Orders do not explicitly outline specific offences, penalties, or civil/criminal consequences for non-compliance, it is implied that failure to adhere to the prescribed financial reporting requirements may result in regulatory action. This could include scrutiny by the Australian National Audit Office or other relevant authorities, which may lead to corrective actions or further legal consequences. The precise nature of these consequences would depend on the extent and impact of the non-compliance, but it is clear that adherence to these Orders is mandatory and critical for maintaining the integrity of financial reporting within Australian Government entities.

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Commencement Provisions
Reporting & Disclosure Obligations
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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.