Note 20: Explanations of significant variances against the Main Estimates

Explanations of significant variances from the Office’s original 2022/23 budget figures (2022/23 Main Estimates) are as follows.

Statement of comprehensive revenue and expense

The overall deficit for 2022/23 was $2.879 million, compared to a deficit of $5.476 million budgeted in the Main Estimates. Revenue was $19.151 million higher than the Main Estimates and expenditure was $16.554 million higher. The revenue and expenditure increases primarily reflect more work completed and more fees earned on audits of public entities carried out by contracted external auditor service providers who were allocated more audits during 2022/23.

Audit New Zealand’s direct expenditure also increased due to the recruitment of more FTEs to support the completion of deferred audits from prior years.

Statement of financial position and Statement of changes in equity

Net assets at 30 June 2023 were $2.851 million less than the Main Estimates. This reflects higher asset balances than anticipated, partially offset by higher liabilities.

Assets at 30 June 2023 were $2.705 million higher than the Main Estimates. This reflects higher increased receivables from billing clients in advance. The increase in our receivables has been partially offset by reduced software expenditure related to the Office’s Information Systems Strategic Plan and supply chain delays in replacing some of our hardware.

Liabilities at 30 June 2023 were $5.556 million higher than the Main Estimates. This reflects higher levels of income received in advance and the repayment of surplus to the Crown.