AUDITOR-GENERAL'S REPORT

In reply to the Hon. R.I. LUCAS (15 November 2006).

The Hon. P. HOLLOWAY (Minister for Police, Minister for Mineral Resources Development, Minister for Urban Development and Planning): Page 819 of the Auditor-General's report indicates a repayment of $200,000 in relation to long term borrowings. This balance sheet item relates to the Commissioner of Police Advance Account Numbers 1 and 2 (imprest accounts) and represents interest free funds advanced by the Department of Treasury and Finance (DTF).

The introduction of the SA Government credit card along with agencies taking over control of their own accounts payable function saw the need for the use of imprest accounts diminish. In 2005-06 DTF wrote to SAPOL seeking repayment of the advance account. This appears as a cash out-flow from operating activities (supplies and services) and not a cash-flow from financing activities. This treatment is in accordance with accounting standards.