Reserve Bank of Australia Annual Report – 1995 Financial Statements Operating Earnings (and Net Profits)

Note 2 Operating Earnings (and Net Profits)

As shown in the following table, net profits in terms of the Reserve Bank Act in 1994/95 were $1,772 million.

The maintenance of value payment to the International Monetary Fund reflects the effects of exchange rate movements on Australia's obligations to maintain the value, in Special Drawing Rights, of the International Monetary Fund's holdings of Australian currency. “Consultants' fees” cover payments made to specialists for “review and advice” services; they include legal and audit fees, but exclude expenditure on consultants incurred in respect of major refurbishment projects where such costs are capitalised as part of the asset value. (See also Note 13.)

The Bank assesses regularly the value of notes from series issued at least ten years previously which are judged to have been destroyed and therefore unavailable for presentation. In 1994/95, an amount of $14.2 million was written off Australian Notes on Issue and included in “Other Revenues”. (The corresponding write-off in 1993/94 was $20.7 million.)

1993/94 $'000   1994/95 $'000
  Revenues
844,405 Net earnings on overseas investments (Note 1(b)) 858,829
1,129,637 Net earnings on Commonwealth Government securities (Note 1(c)) 1,379,286
656,923 Net gains from sales of foreign currency (Note 1(b)) 37,384
5,400 Interest on loans, advances, etc. 14,936
2,370 Net interest from overnight settlements systems 2,793
3,334 Reimbursement by Commonwealth for loan management and registry expenses 2,924
6,783 Banking services fees received from Commonwealth 10,125
2,802 Income from rental of Bank premises (incl. cleaning/maintenance fees) 3,362
5,171 Commission on gold loans (Note 1(b)) 6,049
4,424 Sales of numismatic and other note products 5,981
1,964 Earnings on shares in Bank for International Settlements (Note 9) 2,484
7,269 Maintenance of value payment from International Monetary Fund –
31,554 Other 25,691
2,702,036 Total Revenues 2,349,844
  Less: Expenses
328,024 Interest on deposit liabilities 351,222
  Staff costs:  
70,582 Salaries and wages 69,021
14,243 Superannuation contributions (Note 14) 7,988
8,658 Fringe benefits and payroll taxes 13,416
6,227 Provision for accrued annual leave (Note 5) 7,230
3,069 Provision for long service leave (Note 5) 2,502
  Provision for post-employment benefits (Note 5) 30,348
8,945 Other 8,303
9,828 Special voluntary redundancy/retirement payments (Note 11) 18,084
6,083 Amounts written off bank premises (depreciation) (Note 6) 6,902
10,128 Depreciation of durable assets (Note 6) 8,803
11,554 Premises 10,043
14,493 Equipment 12,681
1,524 Stores and stationery 1,456
9,206 Materials used in note production 7,137
1,591 Travel 1,557
1,768 Consultants' fees (Note 13) 1,095
1,254 Telecommunications 1,133
1,656 Reference materials 1,747
– Maintenance of value payment to International Monetary Fund 10,001
676,457 Net unrealised losses on investments (Note 1(e)) –
8,436 Other 7,111
1,193,726 Total Expenses 577,780
1,508,310 Net Operating Earnings 1,772,064
– Amounts provided for contingencies (Notes 1(e), 3) in terms of section 78 of the Reserve Bank Act –
1,508,310 Net Profits in terms of the Reserve Bank Act 1,772,064