Media Release
15 October 2014
Joint Statement from Department of Treasury and Finance Secretary David Martine and
Department of Education and Early Childhood Development Secretary Richard Bolt in
relation to the Auditor-General’s qualified audit opinion on the State’s and DEECD’s
accounts relating to the valuation methodology for educational assets.
The Department of Treasury and Finance and Department of Education and Early Childhood
Development are firmly of the view that the methodology used by the State to value school
assets is fully in accordance with Australian accounting standards.
The valuation methodology is also supported by the State’s Valuer-General and external
accounting expert advice.
More specifically, the valuation methodology includes an adjustment for economic
obsolescence as required under AASB 13 Fair Value Measurement to recognise expected
permanent excess capacity in the government school system measured with reference to
long-term student enrolment data.
The underlying principle of adjusting for obsolescence has remained unchanged since
2005-06.
The State’s valuation methodology ensures that the value of its school building assets
presents fairly the realisable economic benefit and service potential for achieving the State’s
objective of delivering educational outcomes to the Victorian community, with direct
reference to the number of students expected to benefit from the education services
provided by the State.
The valuation issue also has no implications for the level of funding provided for the
maintenance and upgrades of schools.
Decisions around school maintenance and capital funding are made every year through the
budget process. Investment decisions in relation to school assets are made on the merits of
the department’s bid for funding new or upgraded facilities as part of the annual budget
cycle, consistent with the Government’s financial management objectives and its
infrastructure investment strategy across all budget sector portfolios.
For more information visit: www.dtf.vic.gov.au/afr
David Martine
Secretary
Department of Treasury and Finance
Richard Bolt
Secretary
Department of Education and
Early Childhood Development
Media contact:
Bruce Atherton – 0404 097 654 – bruce.atherton@dtf.vic.gov.au (Treasury and Finance)
Anna Malbon – 0409 003 634 – malbon.anna.p@edumail.vic.gov.au (Education)