Glossary of Guidance Terms

Department forecast reports

Departmental forecast reports (DFRs) establish expected performance as a basis for assessing actual performance.

Departmental outputs

Goods and services produced by a government department.

Depreciation

The wearing out, consumption or other loss of value of assets. Allocated as an expense over the estimated useful life of each asset.

Estimates

The Government’s request for appropriations, and supporting information, is presented to the House of Representatives at Budget time in a formal document known as the main Estimates (the full title is Estimates of Annual Appropriations for the Government of New Zealand); The Estimates detail appropriations sought from Parliament by Vote Ministers for expenses, expenditure and liabilities, for all purposes including classes of outputs. The Estimates also state how output classes are linked to the outcomes the Government is seeking

Executive

The Prime Minister and other Ministers and Parliamentary Under-Secretaries; the Government.

Finance and Expenditure Committee (FEC)

The Finance and Expenditure Committee is a Parliamentary select committee that considers matters relating to the audit of the financial statements of the Government and departments, Government finance, revenue, and taxation. 

Financial assets

Cash or shares (equity), a right to receive cash or shares (equity), or a right to exchange a financial asset or liability on favourable terms.

Financial review

Scrutiny by the House of the performance of the Government and government entities in the previous financial year.

Fiscal objectives (long-term)

The Government's long-term goals for operating expenses, operating revenue, the operating balance, debt and net worth, as required by the Public Finance Act 1989. The objectives must be consistent with the principles of responsible fiscal management outlined in the Act and cover a period of ten or more years.

Fiscal Responsibility Act

The Fiscal Responsibility Act: requires the Government to be explicit about its objectives and to explain any changes to them ; ensures the provision of comprehensive financial information for informed and focused debate about fiscal policy; requires the Government to specify its intentions for fiscal management beyond the next 12 months.

Fiscal strategy report

This report is required to be tabled in the House of Representatives at the time the Budget is presented, and must include: a comparison of the fiscal forecasts in the Budget economic and fiscal update with the Government’s objectives and intentions set out earlier in the Budget Policy Statement; progress outlooks with projections of fiscal trends covering at least the next ten years; and a comparison of the progress outlooks with the long term fiscal objectives set out in the Budget Policy Statement; Inconsistencies between the Fiscal Strategy Report and the Budget Policy Statement and the immediately preceding Fiscal Strategy Report must be explained and justified by the Government

Forecast new capital spending

An amount provided in the forecasts to represent the balance sheet impact of capital initiatives expected to be introduced over the forecast period.

Forecast new operating spending

An amount included in the forecasts to provide for the operating balance impact of policy initiatives and changes to demographics and other forecasting changes expected to occur over the forecast period.

General purpose financial reports

Reports prepared for external users who do not have the ability to require or contract for the preparation of special reports to meet their specific information needs.

Generally Accepted Accounting Practices (GAAP)

The term “generally accepted accounting practice” describes the assumptions and rules applied when preparing and presenting financial statements; In New Zealand the Financial Reporting Act 1993 requires most reporting entities in both the private and public sectors to comply with GAAP; The Financial Reporting Act defines GAAP as: approved financial reporting standards so far as they apply, or where there is no financial reporting standard or applicable rule of law, the accounting rules applied should: be appropriate to the circumstances, and have authoritative support within the New Zealand accounting profession.

Government

The party or parties that command a majority of the House on confidence and supply matters; also used to mean the Executive.

Government Finance Statistics (GFS)

A cash-based system developed by the International Monetary Fund for classifying government revenue and expenditure in which current and capital flows are distinguished.

House of Representatives

The elected Chamber of Parliament; made up of members elected to represent electorates and members elected from party lists.

Imprest Supply Bill

A bill granting the Government interim authority to incur expenses and capital expenditure.

Inputs

The resources used to produce goods and services.