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Note 21:  Equity Accounted Investments

Note 21:  Equity Accounted Investments
Forecast Actual
Original
Budget
$m 		Estimated
Actuals
$m 		30 June 2009
$m 		30 June 2008
$m
6,792 7,424 Tertiary Education Institutions 7,417 7,037
1,891 1,381 Other 1,360 1,028
8,683 8,805 Total equity accounted investments 8,777 8,065

Tertiary Education Institutions (TEIs)

TEIs are Crown entities, and the Government has a number of legislative powers with respect to them in the interests of public accountability and has some significant reserve controls in the event of an institution facing financial risk. However, the Government does not determine the operating and financing policies of TEIs, if they are not at financial risk, but rather is committed to safeguarding their academic freedom and autonomy. By so doing, the Government obtains the benefits of an effective tertiary education sector. Their relationship to the Crown is managed by a plan agreed between them and the Tertiary Education Commission.

The applicability of the test for consolidation in accounting standards as it applies to TEIs and the Government is unclear, and is still under consideration by the relevant accounting authorities. In the interim the TEIs have been included in the accounts as a 100% equity accounted investment.

The financial year of TEIs is the academic year ending 31 December. Half-year information is used to incorporate TEI information into the financial statements. All other associates have a 30 June balance date.

Summarised financial information in respect of TEIs is set out below:

Note 21:  Equity Accounted Investments (continued)
Forecast Actual
Original
Budget
$m 		Estimated
Actuals
$m 		30 June 2009
$m 		30 June 2008
$m

Operating Results

 
2,030 2,121 Revenue from Crown 2,068 2,018
1,849 1,960 Other revenue 1,913 1,912
(3,757) (3,839) Expenses (3,932) (3,705)
122 242 Net surplus 49 225

Net worth

 

Assets

 
1,000 766 Financial assets 1,127 766
6,939 7,315 Property, plant and equipment 7,290 6,928
297 692 Other assets 476 692
8,236 8,773 Total assets 8,893 8,386

Liabilities

 
223 176 Borrowings 174 176
1,221 1,173 Other liabilities 1,302 1,173
1,444 1,349 Total liabilities 1,476 1,349
6,792 7,424 Net worth 7,417 7,037
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