Note 20: Explanation of significant variances against the Main Estimates

Explanations of significant variances from the Office's original 2016/17 budget figures (2016/17 Main Estimates) are as follows:

Statement of comprehensive revenue and expense

The deficit for the year reflects planned use of funds from our memorandum account. The deficit was $2.1 million, which was $0.8 million greater than the Main Estimates. The increased deficit is the net effect of total expenditure and fee revenue both being higher than the Main Estimates.

Actual audit fee revenue was higher than the Main Estimates by $1.1 million, relating to a higher estimated value of the work to date on audits that were under way at 30 June 2017 carried out by contracted audit service providers ($0.8 million) and Audit New Zealand ($0.3 million).

Total expenditure was higher than the Main Estimates by $1.9 million, mainly due to higher direct costs of delivering audits carried out by Audit New Zealand ($1.0 million) and additional work completed by contracted audit service providers ($0.8 million).

Statement of financial position

Debtors and other receivables are $1.3 million higher than the Main Estimates, due to timing of billing of audit fees. This has also resulted in a lower than budgeted cash balance.