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.