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Australian Government Solicitor the leading lawyers to government

annual report 2011 – 12

Australian Government Solicitor Annual report 2011–12

AGS Annual report 2011–12 i

Australian Government Solicitor the leading lawyers to government

Letter of transmittal 1

CEO’s review 3

PART 1 – Delivering our mandate and corporate plan 5

About AGS 6

Support for the Attorney-General 12

Operating as a government business enterprise 17

Outcomes against our corporate plan 23 Our clients 24 Our practice 28 Our people 32 Our business 36

PART 2 – Accountability and management 43

Corporate governance 44

Social responsibility 52

Future directions 56

PART 3 – Financial statements 63

PART 4 – Appendixes and indexes 97

Forums and publications 98

Abbreviations 101

Compliance index 103

Index 105

annual report 2011 – 12

ii AGS Annual report 2011–12

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© Australian Government Solicitor 2012

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ISSN 1444-6154

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AGS Corporate Communications

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or visit the AGS website at www.ags.gov.au

Printed by CanPrint Communications, ACT

AGS Annual report 2011–12 1

28 September 2012

The Hon Nicola Roxon MPAttorney-GeneralParliament HouseCANBERRA ACT 2600

Dear Attorney-General

AGS Annual Report 2011–12

I have great pleasure in submitting to you, for presentation to each House of Parliament, the annual report of the Australian Government Solicitor (AGS) covering the period 1 July 2011 to 30 June 2012.

The report is submitted to you in accordance with section 9 of the Commonwealth Authorities and Companies Act 1997.

Yours sincerely

Ian GoveyChief Executive Officer

the leading lawyers to government


CEO’s reviewAs the Government’s own legal advisor, AGS measures success through the effectiveness of our work in helping agencies achieve their policy and program outcomes, as well as through our financial results. This year has been a particularly successful one.The tobacco plain packaging legislation, the Qantas dispute, live animal exports to Indonesia, major tax evasion matters under Project Wickenby, gambling reforms, carbon price and clean energy initiatives, the minerals resource rent tax, health reforms, energy market reforms, the establishment of new regulatory bodies, new work health and safety laws, asylum-seekers and their detention – in almost every significant legal or policy matter, whether controversial, complex or routine, AGS lawyers were there advising and representing the Government, with often substantial outcomes.

At the same time as we have performed excellent legal work, we have met our requirements as a government business enterprise. The financial result for 2011–12 was extremely positive given the difficult trading conditions (including the financial constraints on agencies and the continued growth of in-house legal areas).

AGS’s trading revenue of $115.7m was more than $8m higher than the corporate plan target and, for the first time in several years, exceeded that of the previous financial year. AGS’s profit including interest was $8.5m which was nearly 50% higher than the corporate plan target.

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In anticipation of market changes and a tightening of client budgets, AGS has worked hard to restructure and improve our business practices, to improve the consistency of our service, to develop strategies to proactively anticipate the needs of new government-wide procurement practices and to help clients adjust to these new requirements. Our organisational changes, which began with the legal practice restructure last year, continued with the implementation of cost-saving measures in corporate services areas. We also enhanced our legal capacity in emerging and increasing areas of government need.

Our program of client communications, forums and training continued to provide valuable opportunities for us to foster productive relationships with government in-house legal teams. The upgrading of our technical infrastructure from State-based IT systems to a national system has provided a platform for further improvement for our staff.

We, and our clients, have achieved much this year. Looking ahead, we know further changes will need to be made to meet the ongoing challenges of a changing market. This was again the focus of our new corporate plan and we believe that – with sufficient ongoing support from our clients and government – we will be well-placed to continue to deliver quality outcomes.

I extend my thanks to our shareholder Ministers and to the AGS Advisory Board for their guidance this year, as well as to our clients for their continuing support and commitment to AGS.

I acknowledge the outstanding contribution of AGS staff in meeting the significant challenges we faced at the beginning of 2011–12, including the restructure of our business practices, and in delivering a successful year for AGS.

Ian Govey Chief Executive Officer

PART 1delivering our mandate and

corporate plan


About AGSThe Australian Government Solicitor (AGS) is the leading provider of legal and related services to Australian Government agencies. We are one of Australia’s largest national law practices, with an office in every capital city.AGS is a statutory authority within the Attorney-General’s portfolio, established under the Judiciary Act 1903. We are subject to the reporting and accountability requirements of the Commonwealth Authorities and Companies Act 1997 (CAC Act).

We are also a government business enterprise under the CAC Act and operate on a commercial and competitive basis. We have 2 shareholder Ministers, the Attorney-General and the Minister for Finance and Deregulation.

We act primarily for Australian Government agencies, and for entities in which the Australian Government has an interest. We also act for State and Territory government organisations at the request of their executive governments.

We seek to ensure success for our government clients by providing consistent, cost-effective, high-quality legal advice and representation, mindful of potential whole-of-government implications. From the most complex constitutional challenges to routine activities of government, our practice is comprehensive and operationally integrated across different areas of law.

We offer the knowledge and expertise of an integrated national practice across more than 40 specialised areas of law. Our lawyers, no matter what their area of practice, are expert in the government environment.

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6 AGS Annual report 2011–12


OFFICE OF GENERAL COUNSELAGS acts for Commonwealth agencies across the full spectrum of government administrative decision-making and activity. AGS’s Office of General Counsel (OGC) delivers specialist legal advice, constitutional litigation and related services spanning the spectrum of the Commonwealth’s activities across all portfolios.

OGC has 73 lawyers including Australia’s leading specialists on constitutional law, public international law and national security law. Our government and administrative lawyers regularly advise on areas such as governance, machinery of government, administrative law, statutory interpretation, freedom of information and privacy, immigration law, health law, public revenue and finance, climate change, energy and water, Indigenous issues, employment law and workplace relations.

OGC also consider all submissions to Cabinet. OGC’s Constitutional Litigation Unit has incomparable specialist expertise and is involved in every significant constitutional case in the High Court, working closely with the Solicitor-General and Attorney-General’s Department’s (AGD’s) Office of Constitutional Law.

AGS DISPUTE RESOLUTIONAGS is the government specialist in resolving and managing disputes – through alternative dispute resolution (ADR) (including mediation, arbitration and conciliation) and litigation. We act in all types of matters – from small claims and disputes, to the largest and most sensitive litigation matters in which the Commonwealth is involved.

AGS Dispute Resolution is a substantial practice with more than 170 lawyers. We appear in all Australian courts and tribunals including the High Court, the Federal Court, Supreme Courts of all Australian States and Territories, the Federal Magistrates Court and the Administrative Appeals Tribunal, as well as representing clients in royal commissions, other inquiries and coronial inquests.

We provide a comprehensive range of dispute resolution services including strategic review and legal analysis, assessment of dispute resolution options, gathering and analysing facts and evidence including working with medical and expert witnesses, preparing court documents and case management plans, addressing interlocutory matters, court appearances, selection, briefing and management of counsel, and representing clients in settlement conferences and mediations.

AGS COMMERCIALAGS assists government agencies with the full range of corporate and commercial legal matters.

In 2011–12 we worked on more than 3,000 commercial matters ranging from high-volume water conveyancing, leasing and securities matters to complex agreements supporting major government initiatives. Our work spanned support to government in relation to defence, immigration and border protection to initiatives associated with major economic, regulatory and social reforms.

Many of our commercial lawyers bring a special perspective to their work gained from many years’ experience in the public and private sectors.

They are expert in advising on areas such as technology projects, grants and funding, intellectual property, media and communications, intergovernmental agreements, infrastructure, construction, property and leasing, insurance, banking and finance, procurement, tendering and contracting, probity, process and risk management.

AGS Commercial works closely with OGC and AGS Dispute Resolution, as many projects require cross-disciplinary teams.


OUR MANDATEAGS’s mandate emphasises 2 objectives.

We are to support the Attorney-General in her role as First Law Officer of the Commonwealth, by:— providing quality legal services to the

Australian Government and its agencies— ensuring that we maintain: – the ability, through our focus on

government, to meet the general legal services needs of agencies at competitive prices

– a ‘whole-of-government’ approach – the corporate memory of Commonwealth

legal practice and advice given by AGS on the Constitution and the law applicable to the Australian Government and its agencies

– the ability to meet the unique legal services needs of the Australian Government, including in the areas of work reserved for government providers.

We are to operate efficiently as a government business enterprise and add shareholder value, by: — operating on a commercial basis— achieving a commercial rate of return on

equity investment— paying agreed dividends to the

Commonwealth.

OUR VISION Our vision for the reporting period was:

To be a world-class adviser helping our clients to advance the national interest.

OUR ETHICS AND VALUESOur ethics govern our attitudes and actions. They reflect our distinctive character as a government business providing legal services to predominantly public sector clients.

Our ethics are integral to the way AGS employees work together. Our shared commitment to AGS operating as an ethical business strengthens us and what we offer to our clients.

Our core values are:– integrity, which requires us to be honest and

impartial in our dealings with others – professionalism, which demands excellence

in working with our clients and interacting with the legal system

– collegiality, which necessitates our working collaboratively as a national team sharing our knowledge

– commitment to the public good, which inspires us in what we do.

By acting in accordance with these values, we earn the respect of, and show respect for, our clients, our colleagues, our shareholders, the legal system and the public at large.

Our ethics and values are put into practice through the AGS Code of Conduct, which sets out the principles and rules of conduct that guide our people in the high professional and ethical standards required of them. The code is supported by a network of ethics advisers, who are available to assist employees in dealing with ethical and professional concerns.

Major outcome for Project WickenbyAs part of our long-running involvement with Project Wickenby, AGS this year assisted the Australian Federal Police (AFP) and Australian Taxation Office (ATO) in a case which effectively dismantled a multi-million-dollar tax-evasion and money-laundering scheme.

Project Wickenby is a cross-agency taskforce, established in 2006 to protect the integrity of Australia’s financial and regulatory systems by preventing people from promoting or participating in the abusive use of secrecy havens (countries with secretive tax or financial systems).

AGS assisted both the AFP and ATO with aspects of the case. Lawyer Jackie Ibrahim assisted the AFP with a proceeds of crime application. Senior Executive Lawyer Matthew Walsh, with assistance from Chief Solicitor Dispute Resolution Simon Daley and Senior Executive Lawyer Kristy Alexander, provided advice to the ATO officers who undertook access at a number of premises, pursuant to s 263 of the Income Tax Assessment Act 1936. In Brisbane, Senior Executive Lawyer Jane Lye and Senior Lawyer Suzannah Auld assisted, with Ms Lye taking possession of documents subject to claims for legal professional privilege (LPP).

Matthew Walsh

Simon Daley

Kristy Alexander


Jane Lye

Suzannah Auld

Jackie Ibrahim

AGS at work


Funding mattersAGS has been supporting Commonwealth agencies across a range of significant matters associated with funding.

Williams decisionAGS was deeply involved in the whole-of-government preparations for the Williams decision, in advising on the effect of the decision, and in the steps taken immediately after the decision was handed down to preserve the capacity of the Commonwealth to engage in funding activities. AGS continues to advise on the implications of the decision.

Standard-form funding agreementsAGS lawyers including Kenneth Eagle and Kathryn Graham assisted the Department of Finance and Deregulation in the development of a low-risk grant template. This whole-of-government template is being developed to streamline and simplify dealings between agencies and grant recipients, particularly in the not-for-profit sector, and is one of a number of initiatives being pursued by the Government in this area.

AGS lawyers including Kathryn Grimes, Garrick Larkin and Rebecca McGloughlin assisted the Department of Health and Ageing in design and development of a new agency-wide standard funding agreement template, which will be used by many of the Department’s grant programs. The new agreement consists of 4 documents: a cover letter, a booklet of terms and conditions, a schedule outlining the details of the funded activity and a set of optional supplementary conditions. The development of this new agreement forms part of the Department’s new grants management system, which will enable the Department to undertake more efficient grants administration.

AGS lawyers including Kathryn Grimes and Phil Sedgely-Perryman assisted the Australian National Preventive Health Agency (ANPHA) in developing a standard funding agreement template. ANPHA administers the Australian Preventive Health Research Grant Program to fund preventive health (health promotion) research projects and the dissemination of research results in order to facilitate and support evidence-based policy decisions.

Health Workforce Australia funding programsHealth Workforce Australia (HWA) is an organisation seeking to foster change, collaboration and innovation in the health sector with the objective of delivering a sustainable health workforce that meets the healthcare needs of all Australians.

AGS provided legal support to HWA in relation to its 2011–12 funding programs. AGS lawyers including Vesna Vuksan, Nicola Walsh, Kenneth Eagle and Garth Cooke worked closely with HWA to develop, negotiate and execute a very large number of funding agreements across a range of programs.

Clean energy initiativesAGS assisted a number of agencies in implementing funding programs associated with clean energy initiatives. Some of these are mentioned here.

Kathryn Graham

Kathryn Grimes

Rebecca McGloughlin

Kenneth Eagle

AGS at work

Vesna Vuksan

Phil Sedgely-Perryman

Nicola Walsh

Garth Cooke

Jenny Burnett

AGS lawyers Kenneth Eagle, Jenny Burnett and Anna Lukeman provided advice to the Department of Climate Change and Energy Efficiency in relation to the Energy Security Fund Cash Payments program – part of the energy security package within the Government’s Clean Energy Future plan. This program involved the provision of transitional assistance in the form of $1 billion in cash payments to highly emissions-intensive coal-fired generators. AGS assisted the Department in the development and implementation of the program, including the drafting of the guidelines and associated program documentation, the development of the assessment methodology, the assessment of applications, dealings with applicants and the arrangements for the making of the cash payments. The program needed to be undertaken within a strict timeframe and in the context of a range of other related Government initiatives being conducted at the same time. The program was completed on time, with payments made prior to the end of the 2011–12 financial year.

AGS lawyers including Helen Curtis, Kathryn Graham, Ranjeet Jordan and Piccolo Willoughby assisted the Department of Resources, Energy and Tourism on the Coal Sector Jobs Package Program. AGS provided a range of advice including constitutional advice, advice on eligibility requirements and calculation of funds payable over the period of the program. AGS also developed a funding agreement to support the program.

Indigenous legal aid programAGS lawyers including Helen Curtis and Kurt Richards worked with the Attorney-General’s Department on the implementation of the new Indigenous Legal Assistance and Policy Reform program for 2011–14.

This involved working cooperatively on the development of clear program guidelines and assisting with the refinement of eligibility criteria and new guidelines for some programs. AGS prepared the funding agreement and guidance to the Department on risks and potential issues for the Department in moving providers from a service provider model to a funding recipient model.

Local Solutions FundAGS lawyers including Helen Curtis, Kate Cabot, Phil Sedgley-Perryman, Lillian Riches, Kathryn Grimes and Piccolo Willoughby worked with the Department of Human Services on the Local Solutions Fund. The Local Solutions Fund provides funding for innovative and creative solutions to increase social and economic participation in 10 Local Government Areas.

The Department took an innovative approach to the implementation of this funding program. This included the appointment of place-based Local Advisory Groups to advise the Department on service gaps and needs in their community as well as undertake the evaluation of applicant projects at a local level. The approach also involved the engagement of Community Action Leaders who worked with stakeholders in the community.

AGS provided strategic advice about the structure of, and guidelines for, the program and how to take account of the local input in decision-making. We prepared documents including FAQ sheets for Community Action Leaders and Local Advisory Group members, the Department’s agreements with host organisations and the Local Solution Fund funding agreements.

AGS lawyers including Kathryn Grimes, Fiona Mackrell and Olivia Abbott advised on the Suburban Jobs program administered by the Department of Sustainability, Environment, Water, Population and Communities. The objective of the Suburban Jobs Program is to support State and local governments to plan and provide for increased local employment opportunities in the suburbs of Australia’s major capital cities that are subject to growth pressures in order to reduce travel times between work and services. AGS provided advice to the Department in relation to the program’s guidelines and grant selection process, and prepared and assisted with the negotiation of funding agreements for the program.


Anna Lukeman

Helen Curtis

Piccolo Willoughby

Ranjeet Jordan

Kate Cabot

Kurt Richards

Lillian Riches

Fiona Mackrell

Olivia Abbott

Support for the Attorney-GeneralSupporting the Attorney-General as First Law Officer of the Commonwealth in the manner set out in our mandate is fundamental to the operations of AGS and the value we deliver to the Commonwealth.AGS assists the Attorney-General as First Law Officer to ensure that the Australian Government has access to high-quality legal and related services that will advance the national interest. We play an essential role in helping our clients comply with the Legal Services Directions (LSDs), including the obligation to behave as a model litigant in the conduct of litigation.

AGS regularly prepares reports to the First Law Officer detailing significant matters for which we have been engaged.

TIED WORKAGS carries out tied (non-contestable) work, which the Government has determined should be performed by AGS and other tied providers pursuant to the Attorney-General’s LSDs.

Tied work includes legal work associated with the Constitution, Cabinet matters, national security and public international law. It accounts for a small proportion of AGS’s revenue.

CONSTITUTIONAL LITIGATION MATTERSAGS conducts the Australian Government’s constitutional litigation. Constitutional litigation involves essential and core aspects of Australia’s system of government which can have enduring and whole-of-government implications extending beyond the interests of any particular agency or portfolio. These considerations require an exceptionally high and specialised level of legal expertise and central coordination.

AGS maintains a uniquely qualified team of talented lawyers with extensive experience covering constitutional litigation, led by David Bennett QC, Deputy Government Solicitor, and Andrew Buckland, team leader of the Constitutional Litigation Unit. This enables AGS

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to undertake the important role of assisting the Attorney-General and her department to identify the Commonwealth’s constitutional policy interests and the means for best advancing those interests.

The Australian Government can become involved in constitutional litigation in either of 2 ways. First, the Australian Government may be a party in its own right, where proceedings have been commenced by or against it. Second, the Commonwealth Attorney-General has a right to intervene on behalf of the Australian Government in cases raising constitutional issues. The Judiciary Act 1903 requires parties in such cases to give Attorneys-General notice of the constitutional issues (under s 78B) to allow a decision to be made on intervention by each Attorney-General (under s 78A).

In relation to possible interventions, AGS’s role includes considering notices given under the Judiciary Act and, in consultation with the Commonwealth Solicitor-General and other interested agencies, advising the AGD on whether the Attorney-General should intervene.

This year AGS reviewed 238 notices given under s 78B of cases raising constitutional law issues. The Attorney-General intervened under s 78A in 18 cases: 9 cases in the High Court, 1 case in each of the Full Federal Court and the Full Family Court, 2 cases in the Federal Magistrates Court, 1 case in each of the NSW Court of Appeal and the Victorian Court of Appeal, and 3 cases in the Western Australian Court of Appeal.

AGS also advises the Government on all submissions on constitutional law issues that are put to courts on behalf of Commonwealth agencies. This is to ensure that these submissions are accurate and apply Commonwealth constitutional policy consistently.

RECENT SIGNIFICANT CASESSome of the more significant matters during 2011–12 were:

— JT International SA v Commonwealth and British American Tobacco Australasia Ltd v Commonwealth, in which the High Court upheld the validity of the Tobacco Plain Packaging Act 2011. The plaintiff tobacco

companies had challenged the validity of the Act on s 51(xxxi) (acquisition of property) grounds, arguing that the Act acquired their property otherwise than on just terms. The Court concluded that the Act is not contrary to s 51(xxxi).

— Williams v Commonwealth, in which the High Court held that the Commonwealth did not have executive power under s 61 of the Constitution to enter into a funding agreement for the provision of chaplaincy services at a State school in Queensland under the National School Chaplaincy Program, or to make payments under that agreement.

— Australian Education Union v General Manager of Fair Work Australia, in which the High Court upheld the validity of s 26A of the Fair Work (Registered Organisations) Act 2009. That provision applied to validate the registration of an industrial association whose registration had been quashed by the Full Federal Court in Australian Education Union v Lawler. The High Court held that s 26A did not, in validating the registration of the industrial association, impermissibly usurp or interfere with the judicial power of the Commonwealth, contrary to Ch III of the Constitution.

— Betfair Pty Ltd v Racing NSW and Sportsbet Pty Ltd v NSW, in which the High Court upheld the validity of fees that 2 State bodies had imposed on Betfair Pty Ltd and Sportsbet Pty Ltd under NSW law as a condition of approvals to use ‘race field information’. Betfair challenged the validity of the fees as contrary to the guarantee in s 92 of the Constitution that ‘trade, commerce and intercourse among the States … shall be absolutely free’; Sportsbet challenged the fees as contrary to s 49 of the Northern Territory (Self-Government) Act 1978, a statutory equivalent to s 92.

— Baker v Commonwealth, a proceeding remitted from the High Court to the Federal Court in which the Federal Court rejected a contention by the applicants, a group of Federal Magistrates, for a constitutional implication arising from Ch III of the Constitution that Parliament should provide


justices appointed under Ch III with a lifelong guaranteed pension in order to protect their judicial independence.

NATIONAL SECURITYAGS continues to work closely with the AGD and security and law enforcement agencies to develop successful outcomes in national security.

We have a centrally-coordinated national security practice, which ensures consistency of our capability across all AGS offices. We have over 20 lawyers working regularly on national security matters.

National security remained a high concern for the Government during 2011–12. We acted in major matters for the Commonwealth involving the collection and protection of national security information, the provision of commercial legal advice in relation to operational matters, and offences and criminal proceedings related to national security.

Our work included assisting the Australian Security and Intelligence Organisation and the Australian Federal Police with legal aspects of their support for prosecutions.

GOVERNMENT POLICY AND PROGRAM MATTERSSome of the most significant legal matters requiring advice, legislation and representation for government policy and programs this year feature in case studies throughout this report. These include tobacco plain packaging, work health and safety reforms, new technology issues, funding programs, the Qantas dispute, the clean energy bill, the Proceeds of Crime Act and the Biosecurity Bill.

In addition, we provided extensive assistance to government in relation to a large number of other very significant legal matters.

A team of lawyers, led by Robert Orr QC, Leo Hardiman and Guy Aitken, provided extensive constitutional and other legal advice in the development of primary and delegated legislation to give effect to significant policy proposals related to:

— the National Broadband Network

— gambling reform

— the minerals resources rent tax

— the Australian Renewable Energy Agency (ARENA)

— the Murray–Darling Basin Plan

— maritime reform

— the Northern Territory intervention

— health reforms

— energy market reforms

— higher education and vocational education and training reforms

— regulation of charities and not-for-profit organisations

— military justice reform

— wheat export marketing reforms

— a new national business names register.

LEGAL SERVICES DIRECTIONSOur success in assisting our clients to comply with the LSDs is measured in terms of the number of reported breaches and our delivery of relevant training to clients. During the year, there was no finding of an LSD breach in relation to matters in which AGS was acting.


Susan Reye

Biosecurity legislative reformAs part of a broad reform to Australia’s biosecurity system, the Australian Government is developing new biosecurity legislation, consisting of 2 significant bills – the Biosecurity Bill and the Inspector-General of Biosecurity Bill.

The Bills aim to help Australia manage risks to the environment and human, animal and plant health by keeping pace with continuous growth in the diversity and volumes of imports coming to Australia, as well as ever-evolving modes of importation.

The new Biosecurity Bill provides that the objects of the Biosecurity Act will include managing biosecurity risks, the risk of listed human diseases (or their contagions) entering Australia or a part of Australia, and risks in relation to ballast water. The Act will also give effect to the International Health Regulations.

The Inspector-General of Biosecurity Bill establishes the office of the Inspector-General of Biosecurity and defines its role, functions and powers.

In 2011–12 Senior General Counsels Susan Reye and Susie Brown, with assistance from other AGS lawyers, provided extensive advice on the constitutional underpinnings of the new legislation and a range of other constitutional, statutory interpretation and international law issues raised by the drafters at the Office of Parliamentary Counsel.

The new legislation will replace the Quarantine Act 1908, now almost 100 years old. It will extend beyond the traditional areas of quarantine (such as controlling the spread of disease) to managing environmental pests, such as invasive species. In its advice, AGS has looked beyond the quarantine power (s 51(ix) of the Constitution) to other constitutional powers such as the external affairs power as it relates to the implementation of Australia’s obligations under the Convention on Biological Diversity.

Susie Brown

AGS at work


> Operating as a government business enterpriseAGS is a fully competitive and commercial legal services provider tasked by our mandate to achieve a commercial rate of return on equity investment and pay agreed dividends to shareholder Ministers on behalf of the Commonwealth.

KEY RESULTSIn 2011–12 AGS:— exceeded our corporate plan targets for both

revenue and profit. Our profit outcome was almost 50% higher than the corporate plan target.

— achieved good or better performance trends against corporate plan performance measures.

MARKET TRENDSAGS remains by far the largest single provider of legal services to government, servicing some 240 different clients. While we maintained our position as market leader in 2011–12, our market share dropped by 3% as the market diversified.

The business environment continues to pose challenges for AGS, to counter the anticipated decline in agencies’ use of external legal services and to develop new ways to maintain and grow our business in order to provide the best possible service to government. To the extent that AGS can address these challenges we seek to do so in our 2012–15 corporate plan.

Expansion of internal legal servicesAccording to figures published by the Office of Legal Services Coordination, the overall government legal services market continued to grow, to a total of $676.6m in 2010–11.

The total legal services expenditure by Financial Management and Accountability Act 1997 (FMA Act) agencies was $598.9m, an increase of 4.7% from 2009–10. The total legal services


expenditure by CAC agencies was $77.7m, an increase of 13%.

Internal legal services expenditure increased by 7.7% for FMA agencies and 18.7% for CAC agencies. External legal services expenditure increased by 2.3% for FMA agencies and 9.4% for CAC agencies.

Over the past 3 financial years, the amount spent on internal legal services has grown by 11% for FMA agencies and 27.8% for CAC agencies. External legal expenditure has grown by 5.1% for FMA agencies and 14.3% for CAC agencies.

AGS sees the increase in in-house lawyers as an opportunity to assist in the areas of training, information and knowledge-sharing and professional development, as agencies continue to develop their teams and services. As the Government’s own legal services provider, we continue to be the legal safety net for government agencies and seek to develop close productive partnerships with all government lawyers to ensure that together we provide the best possible legal advice to serve the national interest.

Client budget constraintsThe new financial year will see most key AGS clients’ budgets tightened by financial constraints including an increase in the efficiency dividend to 4%. A key area in which the Government expects agencies to find savings to offset the efficiency dividend increase is by reducing the use of consultants and contractors.

AGS expects this will result in most agencies seeking to reduce their external legal expenditure. This poses a challenge not only for AGS but for the agencies requiring complex, specialised and timely legal advice and a whole-of-government approach to matters. We intend to meet this challenge by fostering even closer ties with clients and building relationships with new and smaller clients, to continue to promote the excellence of our work and to ensure clients are able to continue benefitting from the best legal advice and high-quality client service.

New legal services procurement processes The Government’s focus on reducing the barriers to entry into the Commonwealth legal services market, through the introduction of the Legal Services Multi-Use List (LSMUL) on 1 June, means competition may increase in the next few years, particularly with medium-tier and boutique legal firms. There is a likelihood that new and existing providers will seek to increase or maintain market-share with strong price offers, at least in the short term.

We intend to meet this challenge by promoting our competitive and flexible pricing strategies and working with clients to use the new processes effectively and ensure they continue to receive best value-for-money from their legal spend.

Meeting our challengesAGS continues to deliver our government mandate and provide exceptional service to our clients while maintaining adequate financial returns to government. Our strong presence in the market continues to ensure keen competition on price by external providers, which ultimately benefits all Australian Government clients.

In 2011–12, we continued to meet the business challenges presented, by implementing our new national structure, reviewing and streamlining our corporate services and refining our pricing and client-service offers. The result is a better-than-forecast financial outcome and a more efficient organisation – delivered while we continued to successfully act for clients in the year’s most significant government legal matters and policy and program implementation.

MEASURING OUR PERFORMANCEFor internal management purposes and confidential reporting to shareholder Ministers, we have used 6 key financial and non-financial performance measures to assess and report on progress in realising the objectives and strategies in our corporate plan. Our results for 2011–12 follow, along with the previous 2 years for comparison. In 2011–12 we achieved good or better performance against all measures assessed.


Scorecard of AGS performance in the past 3 years

Performance measure 2009–10 2010–11 2011–12

1. Legal services revenue l l l

2. Profitability l l l

3. Client satisfaction l l –4. Employee engagement with business – l –5. Legal service capability l l l

6. Business process strength l l l

FINANCIAL OUTCOMES The financial result for 2011–12 was extremely positive given the difficult trading conditions (including the financial constraints on agencies and the continued growth of in-house legal areas).

AGS’s trading revenue of $115.7m was more than $8m higher than the corporate plan target and, for the first time in several years, exceeded that of the previous financial year.

AGS’s profit including interest (before income tax) was $8.5m which was nearly 50% higher than the corporate plan target.

AGS paid an interim dividend of $3.5m in respect of 2011–12, together with a final dividend of

$3.5m for 2010–11. As at 30 June, a final dividend for 2011–12 had not been determined. Income tax of $2.8m was charged to profits for the year.

Since 1999, when AGS became a government business enterprise, we have made profits totalling $151.9m, from which we have provided $47.8m in tax or tax equivalents and $99.8m in dividends, special dividends and repayments of equity. In addition, we repaid a government loan of $15.1m.

The requirement to make full competitive neutrality payments and to earn a commercial rate of return remains a driver of our service delivery to our clients and our reinvestment in AGS.

Performance measure1. Legal service revenue 2011–12 2010–11 Legal service revenue $115.7m $110.5m Legal service revenue per full time equivalent (FTE) employee $188,737 $180,496

Performance measure2. Profitability 2011–12 2010–11

Legal service earnings before interest and tax (EBIT) $6.0m $6.1m

Profit from legal service trading before interest, tax, depreciation and amortisation (EBITDA) $8.7m $9.7m

EBITDA per FTE $14,188 $15,888

Debtor and work in progress (WIP) days 70 days 77 days

Employee and contractor costs as a percentage of legal service revenue 74.4% 74.7%

Return before tax on equity 17.9% 19.5%

Return before tax on gross assets (excluding disbursement debtors) 9.8% 10.3%

Profit (including interest) from ordinary activities before income tax per FTE $13,900 $14,220

Code

l good or better performance or trends

l satisfactory performance or trends (including revenue within 3% of corporate plan target)

l unsatisfactory performance or trends

– metric information not available.


Tobacco plain packagingOne of the high-profile cases which involved a number of AGS lawyers this year was the litigation subsequent to the legislation for the plain packaging of tobacco products.

AGS’s Susan Reye provided advice to, and worked closely with, the Department of Health and Ageing in the development of the Tobacco Plain Packaging Act 2011 and associated regulations. The legislation will prohibit tobacco industry logos, brand imagery, colours and promotional text other than brand and variant names in a standard colour, position, font size and style.

At the same time AGS provided advice on the development of the Competition and Consumer (Tobacco) Information Standard 2011 under the Competition and Consumer Act 2010 which requires new, larger graphic health warnings on all tobacco products from 1 December 2012 in line with plain packaging.

In 4 separate cases, a number of tobacco companies challenged the validity of the Act on the basis that it acquires property otherwise than on just terms contrary to s 51(xxxi) of the Constitution. The tobacco companies commenced proceedings in the High Court, with 2 of these cases being referred to the Full Court of the High Court (British American Tobacco Australasia Ltd v Commonwealth and JT International SA v Commonwealth). Those cases were heard on 17–19 April 2012.

AGS’s Andrew Buckland and Gavin Loughton, assisted by David Bennett QC, Deputy Government Solicitor, led a team of lawyers and legal support staff acting for the Commonwealth in defending the validity of the Act.

The Commonwealth Solicitor-General, Stephen Gageler SC, wrote to CEO Ian Govey to express his gratitude for the work AGS performed in the tobacco plain packaging cases. ‘The Commonwealth’s case at every stage in this hard fought litigation – pleadings, evidence and submissions – was presented with the utmost professionalism and attention to detail,’ he said.

‘The Commonwealth, represented by AGS, was matched against 4 well-resourced multinational corporations represented by 4 of the largest commercial law firms in the country. It was not found wanting.’

The Court has subsequently handed-down orders upholding the validity of the Plain Packaging Act, announcing that, by at least a majority, the Act is not contrary to s 51(xxxi) of the Constitution. The outcome is a key achievement for the government and the Attorney-General, Nicola Roxon, who described

Gavin Loughton

David Bennett QC

Susan Reye

Andrew Buckland

Simon Daley

AGS at work

Justine Knowles

the decision as a watershed moment for tobacco control, with Australia’s actions being closely watched by governments around the world. The Attorney-General thanked the AGS legal team for their hard work on the case.

In addition to the High Court litigation, AGS’s Simon Daley – Chief Solicitor Dispute Resolution – is leading a team of AGS lawyers working on the ongoing investment treaty arbitration brought by Philip Morris Asia against the Commonwealth under the 1993 Agreement between the Government of Australia and the Government of Hong Kong for the Promotion and Protection of Investments. Philip Morris Asia asserts in its Notice of Arbitration that the plain packaging legislation constitutes a breach of a number of Australia’s obligations under the agreement with Hong Kong. The arbitral tribunal was constituted on 15 May 2012.

The AGS team is working closely with the Office of International Law in the Attorney-General’s Department, the Department of Foreign Affairs and Trade and the Department of Health and Ageing as well as a counsel team led by the Solicitor-General.

Laura Armstrong Alison Thompson Anna Hartl

Gareth McCasker Joanna Blair Odette Adams James Anderson

Irene Sekler Christopher Behrens Claudia Oakshott Catherine Kelso

Simon Sherwood


From left to right, the Commonwealth’s legal team at the High Court, at the conclusion of the hearing of the plain packaging challenge: Ron Merkel QC, Andrew Buckland, Danielle Forrester, David Bennett QC, Susan Reye, Gavin Loughton, Megan Caristo, Stephen Lloyd SC, Stephen Gageler SC (Solicitor-General of Australia), David Hume, Justine Knowles, Jeremy Kirk SC, Anna Mitchelmore, Simon Thornton, Ashleigh Tilbrook, Julian Cooke.

Clean energy legislationIn November and December 2011, a package of 18 Bills implementing the carbon price received the Royal Assent. This was the culmination of a number of years of intensive work in which AGS assisted, commencing in 2008.

With the revival of the proposal to enact carbon pricing legislation in 2011, firstly Senior General Counsel Susie Brown and subsequently Senior General Counsel Jenny Burnett and Counsel Adam Kirk were seconded to the Department of Climate Change and Energy Efficiency from OGC to advise on the development and drafting of the legislation. Robert Orr QC again provided support.

At the same time, Counsel Anna Lukeman was seconded to the Department to advise on the development and drafting of the legislation establishing the carbon farming initiative (which involves generation of carbon credits which can be used in the carbon pricing scheme) and the Australian National Registry of Emissions Units (which is the registry for all emissions units held in Australia and is an essential component of the carbon pricing and carbon farming schemes).

After the enactment of the legislation, Jenny Burnett and Anna Lukeman remained on secondment to the Department to provide advice on the drafting of regulations to support the carbon pricing and carbon farming schemes and on the interpretation of the primary legislation.

Susie Brown

Jenny Burnett

Adam Kirk

Anna Lukeman


AGS at work


> Outcomes against our corporate planAGS is a fully competitive and commercial legal services provider tasked by our mandate to achieve a commercial rate of return on equity investment and pay agreed dividends to shareholder Ministers on behalf of the Commonwealth.

AGS CORPORATE PLAN 2011–14

By 2014, AGS aims to have:

— wide client recognition as the first choice legal service provider in core government work

— an enhanced role in supporting the Attorney-General as First Law Officer

— successfully transformed AGS into a truly integrated national practice that delivers consistent high-quality legal services

— strengthened our reputation as having the best government lawyers

— optimised our workforce mix to meet client demand and realise business efficiencies.

This year, we delivered our corporate aims through strategic activities in 4 key areas, outlined in our corporate plan:

— Our clients— Our practice— Our people— Our business


Our clients STRATEGIC FOCUS FOR 2011–14

— build our business with key clients

— develop strategic and trusted partnerships with in-house legal teams

— increase our work in emerging areas of government policy

— increase our market share with CAC agencies

— demonstrate our value and our commitment to consistency and quality of service.

KEY OUTCOMESIn 2011–12 AGS:

— increased our revenue with key clients

— increased our business and profile in emerging policy areas – such as Gov 2.0, carbon pricing, health reforms, and work health and safety

— developed our relationships with CAC agencies and increased our client base in this area

— enhanced our contact and relationships with in-house legal teams of existing and potential new clients through our client training and events program.

Actions to achieve strategic outcomes centred on building business with key clients who were static, declining or showing potential for growth, and developing relationships with potential new clients. We also focused on marketing the benefits of AGS and continuing to implement recommendations from the 2011 client survey, including improving some business practices.

BUILDING BUSINESS WITH KEY CLIENTSWith the market for government legal services becoming increasingly competitive, this year we implemented strategies to strengthen our excellent relationships with and service to long-term key clients.

Early in the year, the Client Services team reviewed the rich material from the March 2011 client survey and prepared reports on 38 clients.

We chose an indicative sample to track through the year.

National Client Service Managers (NCSMs) prepared action plans to address client feedback, develop stronger relationships and target specific types of work.

The strategies proved successful – at the end of 2011–12, 7 of the 8 clients identified in the corporate plan were tracking above budget, with revenues from 2 clients in particular greatly exceeding anticipated figures. In total, the clients identified delivered combined revenue that was 34% above budget – an indication of both our success in building relationships and the satisfaction of our clients.

DEVELOPING NEW BUSINESSOur analyses of the client survey, our revenues, and government policy and program directions, also led to special corporate plan projects to target potential growth areas. These included Gov 2.0, health reforms, carbon pricing and energy, environment and water, law enforcement/regulatory, employment, legislative drafting, advocacy and commercial litigation.

Through the year, project teams reviewed our practices in these areas, identified marketing needs, undertook targeted recruiting, produced publications, held seminars and other events and presented at conferences.

The projects successfully raised AGS’s profile in some emerging policy areas and enhanced our abilities to further our work within growing aspects of the market. Their work will continue as part of business as usual.

CAC Act Legal NetworkAnother area we identified for potential growth was with agencies established under the CAC Act.

This year the CAC Act Legal Network continued to foster relationships and interaction between AGS and CAC agencies’ general counsel and executives.

We worked closely with the Department of Finance and Deregulation, which has established the CAC Act Forum along similar

>


lines to discuss relevant Commonwealth financial issues. We established a management committee comprising representatives from AGS and 3 CAC agencies and held the first meeting on 7 September in AGS Sydney.

The CAC Act Legal Network is featured in a case study on page 40.

IMPROVING THE WAY WE DO BUSINESS

Other projectsThe client survey prompted projects in the corporate plan to address the following business matters:

— pricing – to ensure perception of value and fee expectations are managed

— succession planning – to ensure succession planning is clearly communicated with clients.

The pricing project developed pricing models that demonstrate value to clients by using clear messages, being competitive and enabling comparison. The project reviewed AGS’s pricing policies, fee structures and billing practices. The results of this work were reflected in AGS’s submission for the LSMUL.

The succession planning project delivered outcomes in the areas of professional development and leadership training, as detailed in Our people, page 32.

Knowing our clients’ businessTo help employees better understand the nature and needs of individual clients, we delivered a series of in-house presentations by NCSMs that provided an overview of client agencies’ priorities, discussed how we work with them, and analysed their specific feedback from the client survey.

MARKETING AGS TO CLIENTSOur marketing strategy this year aimed to enhance our position as our clients’ partner in government law and to reinforce messages about the benefits of using AGS, the Government’s own legal agency.

Legal Services Multi-Use ListThe major marketing activity this year was our submission for the LSMUL. We developed a comprehensive submission focused on our depth of expertise, closeness to government, breath of legal subject matter coverage, understanding of client needs, client-focused approach, added value and flexible, competitive pricing. This resulted in AGS being appointed to all 4 legal panels on the LSMUL.

Fostering client communicationAGS’s client service approach has a particular focus on communicating regularly with clients, through direct engagement and products, to get to know their business, receive their feedback and to demonstrate our value and highlight our shared culture and values as part of government.

This year our key events included a client function in Canberra in February. The event attracted general counsel and other senior representatives from a large number of our clients. CEO Ian Govey used the opportunity to emphasise AGS’s role as a government agency providing service to other agencies, our closeness to government legislation, policy and program-making and our willingness to provide flexible strategies to help agencies meet their legal and risk management needs.

We also continued to use a suite of targeted communication products to connect with clients. They included printed and electronic publications such as Litigation Notes, Legal Briefing, Commercial Notes, Express Law bulletins, Express Extras, podcasts and fact sheets.

We began redeveloping our website to give clients a deeper understanding of our skills and services and to promote the real value of using the Government’s own legal agency.

Our strategy in practiceOur client information work surrounding the introduction of new work health and safety (WHS) legislation is an example of our marketing this year. Prior to the new laws coming into effect on 1 January 2012, the CEO wrote to heads of departments and agencies about AGS’s expertise and services in this area. We had already been assisting a number of


agencies in relation to the new laws and put together an integrated national team, drawing on all parts of our practice, to help our clients in the transition. We had strong interest from clients following this letter, many of whom sought our help to understand their obligations.

We published an Express Law for clients when the law commenced, provided clients with information about our key contacts and training program and developed and distributed a series of legal fact sheets on the new legislation and provided 3 podcasts on our website.

Another activity was our sponsorship of the 2011 Sir Harry Gibbs Constitutional Law Mooting Competition run by the University of Canberra’s Isaacs Law Society in Canberra in September 2011. The grand final took place in the High Court of Australia with the Hon Chief Justice Robert French AC judging.

AGS lawyers presented at various external conferences and events including:

— the Arts Law Centre of Australia seminar on the Personal Property Securities Act 2009

— the annual forum of ComClub NT, an association of Commonwealth regional heads in the Northern Territory

— Adelaide University and the Law Society of South Australia’s Advanced Contract Law Masterclass

— CeBIT’s 2011 Gov 2.0 Conference

— a seminar for the ACT Law Society on the scheme for compensation for detriment caused by defective administration (the CDDA scheme)

— a seminar for Engineering Australia on managing problem contracts

— the Zelman Cowen John Monash Scholarships Launch

— Military Justice in the Modern Age – an international symposium to mark the 10th anniversary of the Asia–Pacific Centre for Military Law.

DEVELOPING RELATIONSHIPS WITH IN-HOUSE LEGAL TEAMS

Outpost practiceAGS has a substantial outpost practice – where AGS lawyers at all levels work exclusively with a particular client either in-house or from AGS in the short, medium or long term.

Our outposted lawyers play a vital role in developing better client relationships which in turn generate better outcomes for our clients.

Despite the steady increase in the size of many Australian Government agencies’ in-house legal teams, our outpost practice has continued to mature and expand significantly. Over the past 5 years, we have filled well over 350 outpost positions across more than 45 government agencies throughout Australia. More than a dozen of these placements have been at the equivalent of Head of Legal or General Counsel positions.

Our outposted lawyers have worked on some of the most challenging matters for the Commonwealth Government. They have worked in-house with clients on major commercial and litigation matters and in the development of legislative proposals and on all recent major reforms, including the:

— Carbon Pollution Reduction Scheme, carbon tax and the new legislative regime for carbon capture and storage

— reforms to water use and management in Australia and the development and implementation of the Commonwealth Water Act 2007

— National Energy Market Reform

— maritime legislation reform and the rewriting of the Navigation Act 1912.

This year demand for AGS outpost lawyers increased. At the end of the year, we had approximately 60 lawyers outposted with 22 clients.


ForumsOur regular forums, Government Law Groups (GLGs) and client-training sessions enable us to promote our services and foster relationships with client in-house legal teams.

This year we held 16 well-attended GLGs in Canberra, Sydney, Melbourne, Adelaide and Perth. Topics included clean energy legislation, human rights in Commonwealth law-making, commercial disputes, dealing with contractors, the Commonwealth Procurement Rules, responding to subpoenas, the Personal Property Security Register and protections, privileges and pitfalls in the use of information.

Other forums in Canberra, Sydney, Melbourne and Brisbane included:

— Property and infrastructure forum, Canberra, 11 August 2011

— Competition and consumer law forum, Sydney, 19 August 2011

— Administrative law symposium, Melbourne, 13 October 2011

— Migration law forum, Canberra, 8 November 2011

— Constitutional law forum, Canberra, 16 November 2011

— What’s in the clouds? Cloud computing forum, Brisbane, 17 November 2011

— FOI and privacy practitioner forum, Melbourne, 24 November 2011

— Employment law forum, Canberra, 30 November 2011

— Compensation law forum, Canberra, 23 February 2012

— FOI and privacy practitioner forum, Melbourne, 8 March 2012

— Competition and consumer law forum, Canberra, 28 May 2012.

Training coursesDuring the year AGS conducted more than 80 general training courses. These were open to all government lawyers and featured a range of topics including administrative law, freedom of information, statutory interpretation, understanding legislation, principles in decision-making, delegations and authorisations, WHS laws, essentials for the government lawyer and code of conduct investigations.

We also conducted more than 100 client-specific courses tailored to client needs.

CLIENT FEEDBACKAGS regularly receives feedback from our clients, which we disseminate widely to our legal staff and promote on our Outstanding Client Service section of our intranet and through our intranet news.

We also have annual Client Care Awards to recognise outstanding client service by legal and corporate employees and to reflect feedback from clients. There were 15 individual recipients and 1 team recipient this year.


> Our practice STRATEGIC FOCUS FOR 2011–14

— continue to evolve our national practice

— build our legal services capability and capacity

— ensure AGS is a centre of excellence for core government legal work.

KEY OUTCOMESIn 2011–12 AGS achieved:

— greater efficiency and sustainability in deployment of legal resources through the successful implementation of our legal practice restructure

— greater focus on our legal services capability and capacity for the future

— increased development opportunities for our legal workforce.

Actions to achieve strategic outcomes centred on implementing our new structure for the legal practice groups, continuing our leadership role with alternative dispute resolution and building our practice, to ensuring the continuing excellence of our work.

STRENGTHENING OUR NATIONAL PRACTICEIn the 2010–11 annual report we reported that in 2011–12 we would implement a restructure of our legal practice to better position the organisation to meet future challenges. AGS had, until then, delivered legal services through a matrix management and organisational structure having 3 dimensions – a national network of offices, national client service arrangements and national legal practice groups – with profit and loss accountability residing with offices. Client feedback indicated that some clients did not see AGS as ‘one AGS’ but rather as a number of offices from which they received varying levels of work and service.

It was agreed that, from the new financial year, AGS would operate as 3 national practice groups – the Office of General Counsel, AGS Commercial and AGS Dispute Resolution. Each would be responsible for their profitability, staffing and work management.

As planned, the new organisational structure came into effect with the 3 practice groups in operation from 1 July 2011. The restructure successfully reorganised AGS’s legal service delivery groups and a number of business and support functions, in particular Financial Services and HR Services.

AGS’s leadership teams monitored the restructure implementation throughout the year to ensure that work was appropriately allocated, that opportunities for lawyers were realised and that clients experienced the benefits of a more consistent approach to service.

The key benefits gained from the restructure have included: — a more strategic focus on winning business

through a single, national business plan for each practice group

— more sustainable engagement and deployment of legal resources and support functions in all of our offices

— greater consistency in quality and client service across offices

— better alignment to clients’ policy programs and service lines

— processes such as client reporting and billing more consistent across offices.

BUILDING CAPABILITY AND CAPACITY

Volume of work within practicesOGC’s revenue-earning activity was strong throughout the year, with a considerable increase in the volume of work and the number of lawyers outposted to clients. The early part of the year saw a noticeable increase in the implementation of policy and development of legislation, Cabinet submissions and requests relating to new legislation, both in terms of advice and drafting. OGC’s 2 advisings teams remained busy throughout the year with some significant ongoing work relating to major policy initiatives – for example, the development of legislation relating to tobacco plain packaging, the minerals resource rent tax, and health and education reforms.

OGC’s Constitutional Litigation Unit also had a busy year with significant constitutional litigation including the challenge to the tobacco plain packaging legislation.


AGS Dispute Resolution also saw increased volumes of work lead to positive financial results, as a number of significant matters continued from the early part of the year throughout later months. Larger clients – including the Australian Taxation Office and the Australian Competition and Consumer Commission – continue to refer to us significant volumes of work and revenues were up on last year’s figures for a number of clients.

For AGS Commercial, demand levels were varied across different practice areas. The group undertook considerable work in promoting AGS’s expertise to clients in new emerging areas and applied significant effort to tendering and seeking opportunities for business development with FMA and CAC agencies.

Maintaining the right legal workforceAs work continued to increase, especially in constitutional and dispute resolution areas, throughout the year, ensuring we have sufficient lawyers of appropriate level and expertise to meet client demand became a key focus for our practice groups.

We continued to recruit to meet demand in growth areas and assist with succession planning.

PROMOTING EXCELLENCE IN OUR WORK

Ensuring consistency, quality and appropriate allocation of workA range of activities throughout the year helped achieve the restructure’s aim of helping our practice groups operate to the highest standard. They included:— reviewing and realigning supervision

arrangements to support the new structure

— updating our lists of lawyers approved to open and allocate new matters

— training on billing guide narrations and monitoring of narrations to ensure consistency

— holding practice group conferences and planning days with the focus of bedding down the restructure arrangements and ensuring quality and consistency throughout the year, reflected in group business plans

— a focus on drawing together teams across offices and across practice groups to ensure the right expertise is offered for significant matters

— a strategic review of our property practice with the aim of improving our offer to clients

— a new legal seminar series for lawyers across all 3 national groups commenced in February as part of our commitment to ensuring the continuous development of expertise and the currency of our lawyers’ knowledge

— review and redevelopment of our intranet, including the development of new knowledge repositories in the areas of commercial work, compensation, international child abduction, public interest immunity, personal property securities and work health and safety.

Leading the way in alternative dispute resolutionAGS actively supports the use of ADR processes. ADR is an important option for expeditiously resolving disputes which otherwise might demand the resources of the courts to finalise, involving time, expense and consequent delay. AGS is acutely aware of the pre-eminence given to ADR in the LSDs. All AGS offices and practice areas support clients in their efforts to resolve disputes through ADR, including local mediations. As the government’s key legal advisor we take pride in our role of helping agencies apply ADR within an operational context and in the inter-agency environment. During the year we continued to assist agencies to understand the legislative requirements, the government regimes that apply to resolving disputes and the statutory provisions that might bear on the scope of what can be agreed through ADR. We also helped to manage the issues that arise for agencies participating in ADR processes.Two of AGS’s top lawyers are members of bodies concerned with ADR developments in the Commonwealth environment. AGS Chief Counsel Dispute Resolution Tom Howe QC is a member of the National Alternative Dispute Resolution Advisory Council, the current Fellow of LEADR – Association of Dispute Resolvers, and


a regular participant in the ADR Inter-agency Forum hosted by the Australian Taxation Office. Chief Solicitor Dispute Resolution Simon Daley chairs the Federal Litigation Committee of the Law Council of Australia.AGS offers a wealth of training on ADR that is tailored for the Commonwealth public sector, including ‘ADR and the Commonwealth’ which was developed in collaboration with LEADR. In addition, we deliver an internal course, ‘ADR basics’, to continue building our ADR knowledge and capacity – and a number of our lawyers are accredited mediators. During the year AGS staff supervised an ANU law student undertaking an internship focused on mediation law in Australia and its implications for drafting ADR clauses in contracts.

Government lawyer of the yearAGS’s Glenn Owbridge was awarded the title of Government Lawyer of the Year in the Australian Corporate Lawyers Association (ACLA) Australian In-house Lawyers Awards 2011.

Glenn was nominated for his work on high-profile litigation matters, as well as his coaching, mentoring and training of practitioners within AGS and in-house lawyers in the Australian Competition and Consumer Commission (ACCC) and other government clients, and his dedication to practising law, on behalf of government departments, in the public interest.

Glenn has been with AGS for 30 years, and has practised principally in competition and consumer law for more than 15 years. As Deputy General Counsel Competition and Consumer Law, he provides the professional leadership of our national competition and consumer law team. During the year we represented the ACCC in complex competition law litigation involving conduct both in Australia and overseas. The team’s most significant matter is the ongoing proceedings arising from price-fixing arrangements in air cargo, which have resulted in civil penalties exceeding $58m to date.

The competition and consumer law team, which includes David Ablett, Matthew Blunn, Katrina Close, Matthew Garey, Lici Inge and Jody Marshall, brought successful results for the ACCC during the year in cases involving some of the ACCC’s highest priority areas of cartels, the telecommunications industry, and protecting vulnerable consumers. These included:— ACCC v Apple – in which penalties of $2.25m were imposed for the marketing

of one of the new models of iPad as the ‘iPad with WiFi + 4G’ when in fact it could not connect to a 4G network in Australia

— ACCC v E Direct – in which penalties of $2.5m were imposed for the telemarketing of mobile phone contracts targeting Indigenous communities in areas with no mobile phone coverage

— ACCC v TPG Internet – in which penalties of $2m were imposed for false and misleading advertising and failing to prominently specify the minimum charge in relation to a national advertising campaign

— ACCC v Metricon Homes Qld – in which penalties of $800,000 were imposed for misleading promotion of house and land packages

— ACCC v Harvey Norman – in which penalties of $1.25m were imposed for misleading catalogues with fine print disclaimers, advertising 3D televisions were widely available for sale when they were not

— ACCC v Optus – in which penalties of $3.61m were imposed for misleading advertising by Optus of its ‘Think Bigger’ and ‘Supersonic’ broadband internet plans.

Glenn Owbridge

David Ablett

Matthew Blunn

Katrina Close

Matthew Garey

Lici Inge

AGS at work

Government Lawyer of the Year 2011

‘My employer AGS, and its commitment to the public interest and legal excellence, has provided me an environment which makes such achievements as I have contributed to possible. Best of all, it has provided my team who make the possible real.’


Jody Marshall


> Our people STRATEGIC FOCUS FOR 2011–14— enhance our leadership capability

— develop the best workforce profile

— foster a highly-professional and collegial culture

— promote ‘working together as One AGS’.

KEY OUTCOMESIn 2011–12 AGS:

— updated and enhanced our leadership program through senior leadership and general management workshops and conferences

— successfully negotiated a new enterprise agreement

— established the AGS Alumni program

— strengthened its WHS framework as part of the implementation of new WHS legislation

— progressed succession planning.

ENHANCING LEADERSHIP CAPABILITY

Succession planningAGS has further progressed its succession planning with an increase in focus on the succession framework. Key elements are:

— governance and planning

— how we identify and develop talent

— building depth behind our key business roles.

Succession planning remains a high priority for the AGS executive to ensure our legal expertise is aligned with client requirements.

Enhancing our leadership capabilityAs part of AGS’s leadership program several initiatives were run during 2011–12.

National Practice Orientation The National Practice Orientation (NPO) for new starters to AGS was attended by 42 lawyers and 2 senior specialists who had recently joined the organisation. The NPO provided an opportunity for employees to learn about what is expected of them working at AGS and to network with colleagues.

Management Development ProgramA new Management Development Program for our Managing Legal Assistants was run with a focus on building high-performance teams, facilitation skills and performance management processes and policies.

AGS Leadership SeriesIn February, we launched our AGS Leadership Series for our most senior leaders with a talk by Andrew Metcalfe AO, Secretary, Department of Immigration and Citizenship.

Two more lunch-time sessions were arranged for May and June. Dr Jeff Harmer AO, former Secretary, Department of Families, Housing, Community Services and Indigenous Affairs, and Lisa Paul AO PSM, Secretary, Department of Education, Employment and Workplace Relations, were invited to share their views on effective leadership and to talk about the way they have led large organisations successfully.

Professional Supervision Development ProgramA new Professional Supervision Development Program was piloted in June. This program was designed to provide the necessary development and support for lawyers taking on the responsibility of supervising matters.

Graduate and summer clerk recruitmentFrom mid-February to mid-June, AGS conducted its annual graduate recruitment campaign with 11 high-calibre young law graduates and lawyers being offered a place in AGS’s graduate program. There were 370 applications. Another graduate position will be filled by an Indigenous candidate recruited through the APS Indigenous Program. The summer clerk recruitment campaign started in mid-June.


14%

12%

10%

8%

6%

4%

2%

0%

–2%

–4%

Lawyers and Graduates

Senior Lawyers

Senior Executive Lawyers

Legal Support and

Paralegals

Management/ Corporate Support

AGS

Employee FTE numbers 1 July 2011 and 30 June 2012

Note 1: As at 30 June 2012 total FTE numbers were 613 and total numbers were 657. These numbers include ongoing, term and casual employees but exclude employees on long-term leave and contractors.Note 2: Of the 613 FTE employees, 259 were in Dispute Resolution, 99 were in Commercial, 83 were in the Office of General Counsel and 172 were in Management/Corporate Support.

Percentage change in FTEs 1 July 2011 to 30 June 2012

Workforce profile Following the national restructure, workforce activity has focused on ensuring AGS has the right mix of employees. We increased our efforts on recruiting at lawyer level and retaining legal talent through reward and recognition and career development.

Throughout the year, we also continued to refine the national structure with particular focus on aligning support structures with the national practice groups and reducing support employee numbers to improve efficiency of operations.

Key initiatives included:

— streamlining and ensuring consistency of policies for finance, HR and IT across AGS

— driving efficiencies wherever possible and reducing the number of employees

— centralising the processing of more routine work. For example, HR have consolidated and centralised recruitment, probation and other transactional work.

Lawyers

Legal Support and Paralegals

Management/Corporate

Support

1 July 2011

30 June 2012

0 20 40 60 80 100

120

140

160

180

200

220

240

260

280

300

320

L&G SL SEL

L&G = Lawyers and Graduates

SL = Senior Lawyers

SEL = Senior Executive Lawyers

L&G SL SEL


Lawyer turnover

Level 2010–11 2011–12

Lawyer/Graduate 29% 27%

Senior Lawyer 12% 10%

Senior Executive Lawyer 6% 5%

Note: Turnover refers to resignations and retirements for ongoing and term lawyers

Lawyer stability % at 30 June 2011

% at 30 June 2012

Ongoing lawyers >3 years at AGS 80% 74%

Personal leave2010–11 2011–12

Average days taken per employee 10.7 9.8

% Female and male at 30 June 2012

Key aspects— the increased recruitment of lawyers and

graduates has led to a small increase in their number notwithstanding the promotion of a number of lawyers

— increase in legal support reflects the increase in lawyers

— decrease in corporate employees (–1.8% for the year) reflects business initiatives introduced over the past 12 months

— increase in Senior Lawyers is mainly due to the promotion of Lawyers.

80%

70%

60%

50%

40%

30%

20%

10%

0%Lawyers and Graduates

Senior Lawyers



AGS

Female

Male


% Part-time and full-time at 30 June 2012

FOSTERING PROFESSIONALISM AND COLLEGIALITY

Enterprise agreementA new enterprise agreement was developed, voted on and accepted. Of the employees who participated in the vote 79% supported the new agreement. The agreement was approved by Fair Work Australia on 29 June 2012.

AGS Alumni and Keeping in touchThe year’s corporate plan established 2 programs to keep AGS in touch with former employees and employees on extended leave – the alumni program and the Keeping in touch program.

AGS Alumni provides an opportunity to enhance contact and friendships with former colleagues, develop useful business networks, foster career development and mentoring, and promote AGS’s profile within the legal profession. It was launched in a series of events throughout the country. AGS Alumni is featured in a case study on page 41.

We also launched the monthly Keeping in touch newsletter for AGS staff on long-term leave.

Employee surveyAn employee satisfaction survey was conducted at the end of June 2012. Results of the survey indicated an overall employee satisfaction rating of 68%. Other responses provide useful feedback on specific areas where employees felt positively about AGS as well as those of concern.

Employee well-beingSince the introduction of the Work Health and Safety Act 2011 (WHS Act) in January 2012, WHS activity has focused on aligning previous health and safety systems with the new legislative requirements and educating employees at all levels about their new responsibilities.

Key achievements in 2011–12Development of a new WHS framework involving:

— establishment of a National Health and Safety Committee (HSC)

— new terms of reference for local HSC with the Office Directors as committee chairs

— training for local HSCs and employees on WHS Act and codes of practice (Perth, Adelaide, Canberra, Melbourne, Sydney, Melbourne, Darwin, Outpost)

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%Lawyers and Graduates

Senior Lawyers



AGS

Part-time

Full-time


>— new reporting parameters and quarterly incident statistics reports and analysis to the Executive Management Committee, the Strategy and Operations Advisory Group and the AGS Advisory Board

— update of policies and procedures.

Injury management and workers compensation— review of long-term compensation claims

resulting in the reduction of open claims

— management of return-to-work plans

— centralised management of psychological injuries by the HR team

— development of a new injury-management policy and guidelines for employees and supervisors with a focus on early intervention

— greater focus on psychological health including education of managers and employees on issues such as depression, anxiety, resilience and prevention of bullying and harassment.

Our business STRATEGIC FOCUS FOR 2011–14— make doing business with AGS easier

— create business efficiencies

— ensure our technology is appropriate to our business.

KEY OUTCOMESIn 2011–12 AGS achieved:

— savings and efficiencies, gained for AGS and clients through implementation of the review of our corporate support services

— efficiencies and greater flexibility gained from IT upgrade to fully national systems and processes.

Actions to achieve strategic outcomes centred on bedding-down changes in corporate areas implemented in the restructure and corporate services review, and improving our IT, knowledge management and accommodation.

IMPROVING BUSINESS PROCESSES AND EFFICIENCIES

Restructure and reviewThe restructure of AGS’s legal practice successfully reorganised AGS’s legal service delivery structures and a number of business and support functions, in particular Financial and HR Services.

As reported in last year’s annual report, AGS undertook a review of our corporate services operations in concert with the legal practice restructure, to determine how best to improve our business processes. Changes were made to a number of business processes to standardise them and transfer work between locations and between reorganised teams of fewer employees overall.

Many of the recommendations had been actioned by end June 2011 as part of the reorganisation of Financial Services to support the new legal structure; others continued to be actioned this financial year.

We also made savings in our accommodation with spare space being let go in Adelaide,


Perth and Canberra, substantially reducing our ongoing rentals.

In the final quarter of the year, Financial Services, Client Services and Library Services were asked to work with a reduced staffing budget. The proposed changes will be implemented as part of the coming year’s budget, corporate plan and area business plans.

Upgrading accommodationAGS is committed to acquiring new office premises in Canberra that will provide the best possible working environment for staff, at an acceptable cost. We are currently situated across 2 leased premises in Barton.

Early in the year we signed a Heads of Agreement with the Department of Finance and Deregulation for the handling of the building proposal for new premises at 23 National Circuit, Barton ACT. The first public Notice of Tender for the purchase of the land and construction of the building was issued in September 2011. National advertisements were published shortly thereafter seeking tenders by December.

Finance advised AGS in January that no bid complying with the tender arrangements was received in the tender process.

We continued to explore our options in light of this disappointing development and, by the end of the year, we had shortlisted 4 new buildings in Barton which would enable us to relocate between September 2013 and November 2014.

ENHANCING IT AND KNOWLEDGE MANAGEMENT

Updating ITA number of IT projects progressed during the year to support the transition to the new legal practice structure. These included the IT infrastructure project and the office productivity project.

The IT infrastructure project replaced AGS’s IT infrastructure including servers and network links between all offices to enable greater flexibility and consistency of IT service internally and externally.

In addition to modernising workstations, the infrastructure renewal project has delivered

a more streamlined process for staff working together and collaborating on documents across State office boundaries and prepared the way to upgrade our electronic records management system, Objective.

The office productivity upgrade project provided an upgraded internet browser, SharePoint (AGS’s intranet software) environment and consolidation of file management databases to remove replication between offices. An improved intranet was released in July 2011.

To provide the flexibility our clients need, AGS must maintain a highly mobile workforce. The new infrastructure is particularly well-suited to mobile computing and to making the most of available non-AGS equipment. Our mobile workforce program will take the opportunity to extend the efficiency and flexibility of AGS staff working away from the office.

To this end, AGS acquired a number of iPads for use by lawyers, to enable them to access key legal references when they are in court, at conferences or with clients. We also deployed ultra-lite PCs to staff needing to edit documents and access other systems in more constrained conditions such as court rooms.

Library ServicesThis year the Library successfully completed a restructure which included rationalising the national subscriptions titles, reallocating significant portfolio responsibilities across our regional libraries and adopting more cost-effective processes to compile and distribute current awareness bulletins.

Use of the Legal Opinions database continued to grow. Usage has increased by 11% since 2008, when the recording of usage statistics commenced. A total of 86,106 usage events were recorded this year representing the highest ever recorded usage statistic. A number of legal opinion projects were completed this year representing the collaborative efforts of AGS, the National Archives of Australia and AGD. These included:

— digitising 20 volumes of hard copy legal opinions held in Archives, adding another 4,500 legal opinions to the database


— creating a public internet site which showcases selected opinions from 1901 to 1945

— compiling a third hard-copy volume of selected Commonwealth Opinions from 1923 to 1945

— developing formal arrangements to store a backup copy of classified legal opinions at AGD’s premises in line with minimising AGD’s business-continuity risks.

New Work Health and Safety Act implicationsAGS continues to advise Commonwealth agencies on the implications of the new Work Health and Safety Act 2011 (WHS Act). With work health and safety (WHS) being harmonised between the Commonwealth, States and Territories, it is an important emerging area of practice that affects AGS’s clients both as entities and as individuals.

In particular, we provided advice on the scope of the primary duties in relation to the Commonwealth and public authorities, and the new health and safety duty for ‘officers’ and who might be an ‘officer’ in that context. For some Commonwealth agencies, we advised not only on the application of the Act in Australia, but also its application outside Australia.

AGS also provided advice to numerous clients on WHS obligations in the context of employment disputes and potential litigation against the Commonwealth, provided assistance to clients with WHS right of entry matters and advised a regulatory client on the impact of new Commonwealth and State WHS laws on their public guidance notes.

AGS’s team of WHS experts have developed resources such as fact sheets to share our knowledge and expertise.

We have also advised on the impact of WHS requirements on contracts and have updated precedent documents for many agencies. We provided training sessions nationally for clients so they (and their officers and employees) can ensure they are aware of, and can meet, their new WHS duties. In 2011–12 we conducted:— general awareness training to give clients an overview of the new WHS laws— training on the new ‘officers’ duty— practical training to HR practitioners— training on WHS in the procurement context.

Richard Harding

Paul Barker

Craig Rawson

Amanda Johnston

Bianca Wellington

Graham Bannerman

Stuart Robertson

AGS at work



CAC Act Legal NetworkAGS established the CAC Act Legal Network in June 2011 to foster interaction between general counsel and senior lawyers in bodies established under the Commonwealth Authorities and Companies Act 1997 (CAC Act) – with each other and with AGS. The network continued to develop during the 2011–12 financial year.

Highlights of this year include 2 major forums which brought together network members to discuss significant legal developments, legal practice management issues, and to further consolidate relationships and connections.

The first forum, held in Canberra on 8 December 2011, was a joint venture between AGS and the Department of Finance and Deregulation, and with involvement from the Attorney-General’s Department. Presentations focused on CAC Act bodies working collaboratively together; related entities in the context of CAC Act orders; and the proposed extended application of the Commonwealth Fraud Control Guidelines to CAC Act bodies not previously covered.

One workshop explored ministerial directions and their implications for CAC Act bodies, and another covered legal issues relating to commercial-in confidence and the new freedom of information (FOI) requirements in Commonwealth contracting. An expert panel provided insights and commentary on other current CAC Act legal issues.

The second forum was hosted in March 2012 in our Melbourne office, with discussion of recent legal developments such as the Personal Property Securities Act 2009, contracts and procurement, indemnities and insurance and the Commonwealth workplace health and safety reforms. A panel of CAC general counsels including Judith Welsh, from Australia Post and Elizabeth Grinston of Screen Australia led an excellent panel discussion on legal practice management issues and a Department of Finance and Deregulation representative covered some CAC governance matters.

A year since its inception, the network’s membership has grown to encompass over 40 different CAC Act entities. Members’ feedback about the value of the network to them remains consistently positive and AGS’s role as convenor continues to be favourably recognised and acknowledged.

AGS at work

Megan Pitt

AGS Alumni launchedAGS Alumni was launched nationally with events in every capital city attracting significant numbers of past and present AGS employees, and an array of distinguished Alumni speakers. CEO Ian Govey described the setting up of the Alumni program as a very important achievement for AGS.

‘In its current and earlier structures, AGS has been at the centre of the Australian Government’s work for over 110 years,’ he said. ‘Whatever former colleagues do or did after leaving (AGS), the time spent working as the primary legal advisers to the Commonwealth is remembered fondly, both for the important and interesting work we do, the commitment to acting in the public interest and because of the colleagues with whom the experience was shared.’

AGS Alumni includes 4 High Court judges – Mary Gaudron (1987), Sir William Deane (1982), Sir Alan Taylor (1952) and Sir Charles Powers (1913), as well as 2 current Federal Court judges, several State Supreme Court judges and many other judicial officers who spent some, and in a number of cases, many years at AGS and its earlier emanations. In addition to judicial appointments, former colleagues currently occupy a range of senior Commonwealth public service positions, particularly general counsel positions. New South Wales Attorney General, Greg Smith and Senator Connie Fierravanti-Wells are also alumni.

High-profile Alumni speakers at our launches were the Solicitor-General Stephen Gageler SC, in Canberra; the Hon Justice Margaret Beazley, NSW Court of Appeal, and the Hon Justice Alan Robertson, Federal Court of Australia in Sydney; Dr Claire Noonan, Executive Director of Consumer Affairs, Victoria in Melbourne; the Hon Justice John Logan, RFD, Federal Court, and Barry Cosgrove, Queensland Magistrate in Brisbane; Sarah Court, ACCC Commissioner in Adelaide; George Turnbull, Legal Aid Commissioner of Western Australia and Michael Cole, CEO College of Law, in Perth, and Martyn Hagan, Executive Director, Law Society of Tasmania in Hobart.

The overwhelmingly positive feedback received from Alumni and current AGS employees about the initiative, and the launch events were showcased in our inaugural AGS Alumni newsletter.

AGS at work


PART 2accountability

and management


Corporate governanceAs a government business, AGS differs significantly from private sector law firms in that it operates within a unique legislative and accountability framework.Through this framework, we are accountable for our performance to our shareholder Ministers – the Attorney-General and the Minister for Finance and Deregulation – and, through them, to the Parliament and the Australian community.

LEGISLATIVE FRAMEWORK AGS’s legislative framework has 3 main elements:

— The Judiciary Act 1903 which, under s 55J, establishes AGS as a statutory authority:

– Section 55K sets out AGS’s functions – these functions include providing legal and related services to the Commonwealth; persons and bodies for any purpose for which the Commonwealth has the power to make laws; and, on request, the States, Territories and Norfolk Island and State, Territory and Norfolk Island persons and bodies.

– Section 55N sets out the persons and bodies to whom AGS may provide services in the exercise of its functions.

– The Judiciary Act also specifies the rights, duties and obligations of AGS lawyers; provides for the appointment and terms and conditions of AGS’s Chief Executive Officer; sets out AGS’s powers; and provides a mechanism for setting AGS’s corporate governance requirements.

— The Commonwealth Authorities and Companies Act 1997 (CAC Act) sets out the reporting, accountability and other requirements AGS must meet; also, regulations made under that Act prescribe AGS as a government business enterprise.

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— AGS’s corporate governance arrangements, issued by AGS’s shareholder Ministers pursuant to s 55ZE of the Judiciary Act, complement and expand AGS’s obligations under the CAC Act. The arrangements also set out AGS’s mandate and objectives. Our mandate is set out on page 8 of this report.

AGS has a sole director for the purposes of the CAC Act – the CEO. AGS does not have a board of directors in the usual sense that applies to Corporations Act companies. The CEO is appointed by, and is responsible to, shareholder Ministers for ensuring that, in delivering legal services:

— AGS is managed in the best interests of the Commonwealth

— AGS’s business activities are conducted to minimise any risk of divergence of interests between AGS and the Commonwealth

— AGS and its employees maintain the highest standards of integrity, accountability and responsibility.

EXTERNAL CORPORATE GOVERNANCE

Responsible Minister For the reporting period, the responsible ministers for AGS were Attorney-General, the Hon Robert McClelland MP (to 14 December 2011) and Attorney-General the Hon Nicola Roxon MP (from 14 December 2011). Shareholder responsibility for AGS was exercised jointly by the Attorney-General and the Minister for Finance and Deregulation – Senator the Hon Penny Wong.

Ministerial directions Section 55ZE of the Judiciary Act provides for the Attorney-General and the Finance Minister (acting jointly) to inform the CEO of the corporate governance arrangements that are to apply to AGS. In November 2003, shareholder Ministers issued revised corporate governance arrangements for AGS that continued to apply to AGS during 2011–12.

During 2011–12, there were no notifications of General Policy Orders that were to apply to AGS under s 48A of the CAC Act.

The following general policies were notified to AGS before 1 July 2008 under s 28 of the Act (as in force before 1 July 2008) and continue to apply to AGS:

— the Australian Government Protective Security Policy Framework (which replaced the Australian Government Protective Security Manual)

— the National Code of Practice for the Construction Industry and the Implementation Guidelines for the Code (to apply to construction-related activity undertaken by Commonwealth authorities).

Significant events No significant events in the context of s 15 of the CAC Act occurred during 2011–12. This section deals with the need to notify the responsible Minister of events such as proposals to form a company, partnership, trust or joint venture; to acquire or dispose of a significant shareholding; to acquire or dispose of a significant business or commence or cease a significant business activity; or to make other significant change.

Judicial decisions and reviews by outside bodies During 2011–12, no judicial decisions or decisions of administrative tribunals had, or may have, a significant impact on AGS’s business operations. There were not any reports on the operations of AGS by the Auditor-General (other than the report on the financial statements), a parliamentary committee the Office of Australian Information Commissioner or the Commonwealth Ombudsman. AGS’s role in providing legal services with respect to a particular legal matter was considered by the Ombudsman as part of a broader review of the conduct of that matter by a number of Commonwealth agencies.

AccountabilityUnder the provisions of the CAC Act and the AGS corporate governance arrangements issued by our shareholder Ministers, we are required each year to prepare a corporate plan covering an outlook period of 3 years. The plan sets out broad areas of strategic focus, each critical to our continuing business success and building our future. Under each area of strategic focus, the


plan identifies a number of specific actions to be undertaken during the first year of the planning period. As required, AGS provided its corporate plan for 2012–15 to shareholder Ministers by 31 May 2012.

We provide our shareholder Ministers with confidential quarterly progress reports, including financial statements, against the objectives, strategies and actions detailed in our corporate plan.

We are also required to prepare an annual statement of corporate intent, which is a high-level summary of our annual corporate plan. The statement is agreed between shareholder Ministers and AGS, and is tabled in Parliament. AGS’s annual financial statements are audited by the Auditor-General for the Commonwealth.

Although AGS does not receive any Budget or other appropriations, AGS can be requested to attend the estimates hearings of the Senate Standing Committee on Legal and Constitutional Affairs in relation to matters associated with AGS’s operations.

AGS ADVISORY BOARD While AGS does not have a board of directors, it has an Advisory Board comprising the CEO and 3 to 5 external (non-executive) members who are appointed by the CEO on the nomination of AGS’s shareholder Ministers. The role of the AGS Advisory Board is to advise the CEO on the strategic development of AGS as a business and on its business performance so as to ensure that: — the Commonwealth’s investment in AGS

is safeguarded and enhanced— AGS’s strategic direction is conducive to its

long-term success as a government-owned provider of quality legal services to the Australian Government

— AGS meets its responsibilities and obligations to shareholder Ministers and effectively communicates with them on its operations and performance.

The non-executive members of the AGS Advisory Board during 2011–12 were:

— John Allen (chair): principal of John Allen & Associates (executive search consulting). (Appointed 15 November 2000.)

— Richard Alcock: Managing Director, Investment Banking Group, Merrill Lynch International (Australia) Ltd. (Appointed 15 August 2011.)

— Jeffrey Browne: company director; former managing partner of the Australian offices of US law firm Sullivan and Cromwell. (Appointed 1 May 2006; retired 31 July 2011.)

— Dymphna (Deej) Eszenyi: practising barrister working predominantly in civil and industrial law. (Appointed 15 August 2011.)

— Richard Ryan AO: company director; chair of Editure Ltd and several other boards; former Chancellor Charles Darwin University. (Appointed 15 November 2003.)

Audit CommitteeMembers of the Advisory Board also sat on AGS’s Audit Committee: — Richard Ryan (chair) — Richard Alcock (from 15 August 2011)— John Allen — Jeffrey Browne (until 31 July 2011)

AGS’s Audit Committee is established in accordance with s 32 of the CAC Act and AGS’s corporate governance arrangements. The role of the committee is to assist the CEO to discharge responsibilities in relation to AGS’s management and business control framework, audit, and financial risk management.

The CEO and Chief Financial Officer have a standing invitation to attend each meeting, and representatives of the Australian National Audit Office are invited as observers.

AGS Advisory Board members’ attendance at meetings of the Advisory Board and Audit Committee in 2011–12 is shown following.


Meetings attended by AGS Advisory Board members (number attended/number held while a board or committee member)

AGS Advisory Board

Audit Committee

No. of times board/committee met during 2011–12* 4 3John Allen 4/4 3/3Richard Alcock 4/4 3/3Deej Eszenyi 3/4 –Richard Ryan 4/4 3/3Ian Govey (CEO) 4/4 3/3**

* The Advisory Board and the Audit Committee did not meet in 2011–12 before Mr Browne retired on 31 July 2011.

** The CEO is not a member of the Audit Committee but has a standing invitation to attend committee meetings.

Parliament

Shareholder MinistersAttorney-General,

Minister for Finance and DeregulationAGS Advisory Board

Advises the CEO on the strategic development of AGS as a business and on its business performance

CEOAssists the CEO to discharge his responsibilities in relation to AGS’s management and business control framework, audit and financial risk management

Audit Committee

AGS Annual Report

AGS Statement of Corporate Intent

Senate Estimates hearings

AGS Corporate Plan

Confidential quarterly reports

Legislative framework:– Judiciary Act

– Commonwealth Authorities and Companies Act

– AGS corporate governance arrangements

Our external corporate governance structure

Non-executive Advisory Board members are contracted, on a fee-for-service basis, to provide advice to AGS’s CEO. Members’ fees are based on comparable fees recommended by the Remuneration Tribunal. Members were initially informed of their responsibilities through letters of engagement setting out the terms and conditions of their appointment to the Board.

The Advisory Board has implemented a system for reviewing its performance annually.

INTERNAL CORPORATE GOVERNANCE

Director Under s 55S of the Judiciary Act, the CEO is the sole director of AGS for the purposes of the CAC Act and is equivalent to an executive director. The CEO has the function of managing AGS.

For the reporting period, the director was Ian Govey BEc LLB (Hons).


Legal Service DeliveryChief Operating Officer

Regional client relations and local leadershipOffice Directors

Office of General Counsel (OGC)National Group LeaderNational Group Managers (2)Team LeadersOGC lawyers and legal support

CEO

AGS CommercialNational Group Leader National Group Managers (2)Team LeadersCommercial lawyers and legal support

Professional leadersChief General Counsel

Chief Counsel Commercial

Chief Counsel Dispute Resolution

Chief Solicitor Dispute Resolution

Deputy Government Solicitor

Deputy General Counsel and Special Counsel (in specific practice areas)

Outpost ServicesNational Manager

Practice SupportNational Manager

Pro Bono ServicesManager

Financial ServicesCFO

Client ServicesDirector

HR ServicesDirector

IT ServicesNational ManagerLibrary Services

National Manager

Training ServicesNational Manager

AGS’s organisational structure and reporting lines to the CEO at 30 June 2012

AGS Dispute ResolutionNational Group Leader National Group Managers (3)Team LeadersDispute Resolution lawyers and legal support

Internal corporate governance committees AGS has a number of internal corporate governance committees which advise the CEO on the effective management of AGS.

— Executive Management Committee – advises the CEO on AGS’s business development and operations and ensures AGS operates effectively and efficiently as a nationally integrated business (chaired by the CEO).

— Strategy and Operations Advisory Group – develops and reviews AGS’s corporate plan and considers major strategic and operational issues (chaired by the CEO).

— Employee Council – provides a forum for employee representatives to advise the CEO on AGS employment issues (chaired by the CEO).

— Ethics Committee – sets the ethical and cultural principles upon which AGS functions (chaired by the CEO).

— Remuneration Committee – advises the CEO on AGS’s remuneration policies and strategies to ensure AGS is able to attract and retain its talent (chaired by the CFO).

RISK MANAGEMENT Each year, AGS prepares a risk management plan which is summarised in the AGS corporate plan submitted to shareholder Ministers.

Using a risk management methodology that reflects the Australian/New Zealand Standard, AS/NZS ISO 31000:2009 Risk Management – Principles and guidelines, risks are rated as significant, moderate or low. Significant risks require an individual risk management plan to


be prepared by a senior manager nominated by the Executive Management Committee.

The Audit Committee annually reviews AGS’s overall risk management plan, particularly in relation to risks associated with financial management.

AGS’s business continuity planning framework flows from AGS’s overall risk management plan.

INDEMNITIES AND INSURANCE PREMIUMS FOR OFFICERS AGS provides an indemnity to the CEO under the terms and conditions of his appointment, indemnifying him against any liability incurred by him in good faith in connection with his duties, but excluding any liability or legal costs in respect of which AGS must not indemnify the CEO pursuant to s 27M of the CAC Act.

AGS also provides an indemnity to each non-executive member of the AGS Advisory Board under the terms and conditions of their appointments, indemnifying them against liability to third parties incurred in good faith in connection with their duties, and for reasonable legal costs in defending civil proceedings in respect of such liability or in defending criminal proceedings in which they are acquitted.

Professional indemnity insurance and other appropriate insurances, including a Directors and Officers Liability and Company Reimbursement policy, have been acquired on terms and conditions that are consistent with provisions in the CAC Act.

COMMUNITY SERVICE OBLIGATIONSAGS does not have any formal community service obligations.

FREEDOM OF INFORMATION In accordance with competitive neutrality principles, AGS is exempt from the operation of the Freedom of Information Act 1982. Consequently, AGS is not subject to the Information Publication Scheme at Part II of the Act.

ADVERTISING AND MARKET RESEARCH AGS is not a statutory agency under the Public Service Act 1999 and is therefore not subject to s 311A of the Commonwealth Electoral Act 1918, which requires the annual reports of departments of state, parliamentary departments and statutory agencies to include particulars about their advertising and market research activities.


Andrew Berger

Sarah Wright

Karina Harvey

Tom Howe QC

Craig Rawson

AGS at work

Behind the scenes of the Qantas disputeIt’s not unusual for AGS people to be involved in headline stories – in almost every news item concerning the government and a legal issue, AGS is there. While the Australian public watched the extraordinary events of the Qantas dispute unfold on the news in October 2011, a handful of AGS practitioners were in the thick of it.

Andrew Berger, Sarah Wright, Karina Harvey, Tom Howe QC and Craig Rawson worked under extreme pressure over the weekend of 29 and 30 October to help bring about the successful outcome achieved early on the Monday morning.

On the Saturday morning, Qantas CEO Alan Joyce announced that Qantas would ground all aircraft from 5 pm that day because of a decision taken by Qantas to ‘lock-out’ various employees with effect from 8 pm the following Monday. The imminent lock-out was Qantas’s response, as employer, to a long-running industrial dispute with unions.

At 4.30 pm Senior General Counsel Dispute Resolution, Andrew Berger, received a telephone call from the Legal Group at the Department of Employment, Education and Workplace Relations (DEEWR). The Minister wished to make an urgent application pursuant to s 424 of the Fair Work Act 2009 to terminate or suspend the lock-out. Section 424 enables Fair Work Australia (FWA) to do this if the protected industrial action might, relevantly, cause significant damage to an important part of the Australian economy.

Then, at 5 pm, Qantas grounded all of its domestic and international fleet. Andrew arrived at AGS, quickly followed by Senior Executive Lawyer from the Employment Law team, Sarah Wright, and Senior Lawyer from the Law Enforcement team, Karina Harvey. Chief Counsel Dispute Resolution, Tom Howe QC, arrived soon after and was briefed on developments.

Between 5 and 10 pm that night, arrangements were made with FWA to convene an urgent hearing in Melbourne at 10 pm, with video links to Sydney and Canberra. Arrangements were also made for evidence to be given about the damage that would be caused to the Australian economy as a consequence of the grounding of the Qantas fleet. An application with supporting annexures was prepared and filed with FWA.


At 10 pm, the hearing commenced. FWA was constituted by President Justice Giudice, Senior Deputy President Watson and Commissioner Roe. Tom Howe QC appeared with Andrew Berger for the Minister, instructed by Sarah Wright and Karina Harvey in Canberra. Counsel also appeared for the parties in Sydney and Melbourne, including the Ministers for Industrial Relations in NSW and Victoria, Qantas and the various unions involved.

On Sunday 30 October, at 1.20 am the hearing was adjourned until 2 pm. Throughout that morning, the AGS team conducted further legal research, obtained further instructions and undertook numerous tasks necessary to prepare for the hearing that afternoon. An additional counsel from the senior bar in Melbourne was added to the Counsel team, led by Tom and instructed by Craig Rawson.

The hearing resumed at 2 pm with further evidence called by Qantas. Their witnesses were cross-examined and, at 8 pm, the parties were called upon to make submissions. The submissions concluded around midnight and the Tribunal indicated it would give its reasons for decision.

On Monday 31 October, just after 2 am, the Tribunal handed down its decision to terminate the dispute, the primary remedy sought by the Minister. Tom, Andrew and Sarah were asked to attend a teleconference with senior Commonwealth officials to discuss the decision.

At around 3.30 am, Sarah, Andrew and Tom finished work. They had been working for approximately 29 hours of the previous 34 hours since instructions were first provided. At 2 pm, as a result of FWA’s decision, Qantas flights recommenced.

Departmental secretaries thanked those who worked on the matter, and commended the minute-to-minute judgment calls which had to be made in the course of presentation of the Minister’s case.

Social responsibility COMMUNITY SERVICE OBLIGATIONSAGS is not subject to, and does not receive funding for, any formal community service obligations. However, as a legal service provider operating as a government business enterprise, AGS has general obligations to the community and to its employees to act as a good corporate citizen. Key activities we undertake include pro bono legal work, environmental initiatives and reconciliation initiatives.

PRO BONO LEGAL WORKAs a government-owned business and statutory authority, AGS can only undertake pro bono work that involves acting for a person or body for whom AGS can act in accordance with its functions and powers as provided for under its enabling legislation, the Judiciary Act 1903. AGS does not undertake pro bono work in any matter against a Commonwealth agency or where there is an unacceptable potential for conflict of interest for government clients.

Highlights of our pro bono work this year are on pages 54–55.

ENVIRONMENTAL PERFORMANCE Under s 516A of the Environment Protection and Biodiversity Conservation Act 1999, AGS is required to report on ecologically sustainable development and environmental matters. As a specialist legal practice operating in competition with the private sector for the provision of legal services to government clients, AGS does not administer programs or legislation relating to ecologically sustainable development or the environment. We do, however, provide services to client agencies to assist them in carrying out their work programs, including ecologically sustainable development and environmental work.

The major impact of AGS’s business operations on the environment relates to electricity and other resource usage in its leased office accommodation.

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Environmental policyThe AGS Environmental Policy Statement acknowledges AGS’s responsibility to government and the wider community to limit the negative impact of its operations on the environment. Our internal environmental policy details a range of initiatives and practices that can be adopted by AGS corporately and by individual employees. These include energy management, waste and recycling, water conservation and environmentally considered purchasing.

To help us implement these initiatives we have a national network of environment contacts and greening groups, made up of employees who volunteer their time to assist with environmental initiatives.

COMMITMENT TO RECONCILIATIONAGS’s Reconciliation Action Plan contains specific actions and targets to help us reach our goals in each of the following areas:

— Respect: gaining a broader understanding of Indigenous cultures and their contribution to Australia’s success and of the legal issues affecting Indigenous Australians

— Relationships: developing a network of relationships to support our reconciliation work – with Indigenous representatives and organisations, with our government clients, and with law societies and other law firms

— Opportunities: supporting Indigenous law students and graduates, and potentially offering employment; and seeking ways in which our lawyers can contribute further to the Commonwealth’s reconciliation goals through pro bono activities.


AGS at work

Geetha Nair

Pro bono legal workAGS continues to lead the way in the provision of pro bono services by government lawyers. This year we provided 4,157 hours of pro bono legal work to the community, valued at over $1.2m. Approximately 25% of AGS lawyers undertook some form of pro bono work.

As a government-owned business and statutory authority, AGS can only undertake pro bono work that involves acting for a person or body for whom AGS can act in accordance with its functions and powers under the Judiciary Act 1903. AGS does not undertake pro bono work in any matter against a Commonwealth agency or where there is an unacceptable potential for conflict of interest for government clients.

Working with Indigenous corporationsIn 2011–12, AGS continued with its involvement with LawHelp, an initiative developed by AGS and the Office of the Registrar of Indigenous Corporations to match up pro bono providers with not-for-profit corporations registered under the Corporations (Aboriginal and Torres Strait Islander) Act 2006.

Since its commencement in 2010, LawHelp has successfully referred 27 matters to pro bono lawyers (2 matters are currently pending), with AGS taking a number of those referrals. AGS has provided pro bono legal advice to Indigenous corporations in Queensland, New South Wales, Victoria and Western Australia.

New National Manager for AGS Pro Bono Services, Geetha Nair, continues AGS’s key role as a member of the LawHelp Assessment Panel which considers applications for assistance.

Supporting community legal centres and pro bono clearing houses AGS continued its partnership with the Darwin Community Legal Service in the management of the Credit and Debt Legal Service, including the provision of lawyers on secondment. The Credit and Debt Legal Service is the Northern Territory’s only specialist provider of free legal advice for people affected by debt or credit problems including issues with mortgages and repossessions, loans or credit cards, unsecured loans, credit reporting or any other debt or credit legal problem, and in recognition of the social problems arising out of credit and debt matters.

AGS also continued its successful secondment program, assisting a range of community legal centres and pro bono clearing houses across Australia by supplementing their resources with AGS lawyers. During the year, AGS lawyers worked with the Public Interest Law Clearing House in Victoria, NSW, and Queensland; the Arts Law Centre of Australia; JusticeNet SA; the Employment Law Centre of WA; Street Law; and the ACT Pro Bono Clearing House. AGS also commenced a secondment with the North Australian Aboriginal Justice

AGS at work

Catherine Langman

Agency in Darwin this year, to assist with drafting fact sheets providing advice and information on issues of importance to their clients.

AGS also worked with Welfare Rights in the ACT to provide training on information access as well as drafting some fact sheets for their website on various issues relevant to their clients, including a fact sheet on tenancy issues, particularly for tenants in public housing. AGS also provided drafting assistance to the Fred Hollows Foundation to update and consolidate some of their agreement templates.

In conjunction with the Arts Law Centre of Australia, AGS provided free training to their clients on the Personal Property Securities Act 2009, and assisted by updating some of its agreement templates to ensure they complied with the requirements of that Act.

AGS staff also participated in the annual Walk for Justice in Adelaide, Brisbane, Melbourne and Sydney to show support for access to justice initiatives.

Pro bono work in the Asia–Pacific AGS continued to build on its relationship with the Papua New Guinea (PNG) Department of Justice and Attorney-General as its major international initiative. In November 2011 and April 2012, a number of AGS lawyers presented pro bono legal training in Port Moresby to PNG government lawyers working in the State Solicitor’s Office and the Office of the Solicitor-General.

Four courses were presented to more than 100 participants – Understanding Legislation, Train the Trainer, and extended versions of the Advice Writing and Statutory Interpretation courses as well as a course on Commercial Advising. AGS was recognised with the short listing of Counsel Catherine Langman as a finalist in the Australian Lawyers Weekly Pro Bono award, for her work in the legal training undertaken in PNG.

In August 2011, AGS offices in Sydney and Canberra hosted a delegation from the PNG Solicitor General’s office on a study tour. The primary aim of the tour was to give the delegation a better understanding of how alternative dispute resolution is used by the Australian Government and to assist them to develop strategies to increase its uptake in PNG. AGS has also provided a 3-month placement to a lawyer from the PNG Office of the Solicitor General to work within AGS Dispute Resolution in Canberra.

In November 2011 AGS provided a series of training courses in Honiara in the Solomon Islands to government officers from the Correctional Service, Ministry of Police and Ministry of Justice. Training was done in collaboration with the Regional Assistance Mission Solomon Island initiative and covered procurement, tender evaluation, contract management and contract law.


Future directionsAs in recent years, ongoing pressure on revenues and market can be expected. We have responded in the best possible manner to meet the challenges of a changing government legal services market by ensuring we have a top quality workforce and sustainable business strategies.

CORPORATE PLANNING FOR 2012–15To meet our mandate and achieve our vision, we will focus on 4 key areas for the corporate planning period 2012–15 under the categories of Our clients, Our practice, Our people and Our business.

Our clients— actively pursue new business opportunities

and work in emerging areas of government policy

— strengthen our business with key clients

— further develop strategic and trusted partnerships with in-house legal teams

— continue to foster our staff’s commitment to consistency and quality of service

— promote our competitive pricing and demonstrate value for money in our bids and quotes.

Our practice — continue to evolve our national practice

— enhance and promote our reputation as the key provider of core government work

— further develop our legal services capability and capacity.

Our people— enhance our leadership capability

— continue to develop the best workforce profile

— foster our highly-professional and collegial culture.

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Our business — make doing business with AGS easier

— create greater business efficiencies

— ensure our technology is appropriate to our business.

Each of the areas of strategic focus is critical to our continuing business success, and all are equally important in building our future. Under each area, the plan sets out a number of priority actions for 2012–13.

FINANCIAL PLANNINGOur 2012–15 corporate plan includes a dividend payment for each year of the plan. Capital investment is covered in the plan, with the timing, level and financing of this investment being subject to investment appraisal to ensure maximum value is added.

Over the corporate planning period, we expect to continue to add shareholder value and improve the efficiency of our operations. We will also be aiming to realise performance against our non-financial performance measures that is at the same level as or better than the corporate plan target.

Achieving our planAchievement of our corporate plan will ensure AGS:

— remains integral and critical to the role of the Attorney-General as First Law Officer

— is the first choice legal service provider to government

— is a truly integrated national practice that delivers consistent high-quality legal services

— remains an expert, reliable and flexible legal adviser meeting client needs.


Gov 2.0 and negotiating ‘the cloud’This year AGS has continued to develop its Gov 2.0 and social media expertise. Recent work has ranged from drafting disclaimers for government Facebook pages and working on risk assessments for YouTube channels, through to delivering training on social media moderation strategies and advising an agency on cybersmearing and cyberstalking issues associated with use of a blogging site.

Our lawyers have provided urgent advice regarding various legal issues associated with closed Facebook groups, open Facebook pages and iPhone ‘apps’ that interface with official Australian government computer systems. We have also provided advice on the legal implications of the recent changes to Google’s standard Terms of Service and Privacy Policy.

AGS is also working in partnership with various departments on groundbreaking projects that make use of new media to improve government services. This has included working with the Attorney-General’s Department on the free Disasterwatch smartphone application now available through iTunes, and developing a better practice guide for the Australian Government Information Management Office (AGIMO) on the legal issues associated with the government’s growing use of ‘cloud computing’.

Cloud computing is best defined as the provision of computing as a service over a network (such as the internet) and is currently touted as the future way of providing most information technology products and services.

The Better Practice Guide, entitled Negotiating the cloud – legal issues in cloud computing agreements, is designed to help agencies to navigate typical legal issues in cloud computing agreements. Some of these issues will be familiar to those who deal regularly with information technology contracts. However, the nature of cloud computing can create new or different risks and agencies may need to consider these issues afresh in the cloud computing context.

Like cloud computing itself, cloud computing agreements appear in a wide variety of forms. These can range from simple standardised click-wrap agreements to multilayered sets of terms and conditions. There are, however, a core set of legal issues that agencies should consider in any cloud computing agreement, whether or not the agreement expressly deals with those issues.

Andrew Schatz

Adrian Snooks

AGS at work

Swee-Kim Tan

Tony Beal

Stuart Hilton

Joanna Piva

Alexander Readford

CEO Ian Govey hosted a well-attended Government Law Group event on the legal issues associated with cloud computing in late 2011. He opened with a foray into early and interesting advices on telecommunications provided by Attorneys-General including one from Robert Garran (then Secretary of the Attorney-General’s Department) on the possibility of provision by the Commonwealth of remotely monitored electric burglar alarm services – an early example of a cloud service!

AGS Senior Executive Lawyer, Adrian Snooks, spoke on the legal issues in cloud computing with particular reference to the Better Practice Guide on these issues. He was followed by Ross Dobson, Assistant Director, Governance and Policy Branch from AGIMO, who discussed the Government’s cloud computing strategy in detail.

The Guide, developed by AGS lawyers including Adrian Snooks and Andrew Schatz, is currently available on the AGIMO website. A short podcast from Adrian discussing some of these issues is also available on the AGS website.

AGS Senior Executive Lawyer Jane Lye and AGS Senior General Counsel Tara McNeilly also spoke on various legal issues associated with cloud computing at the ‘What’s in the clouds?’ forum held in Brisbane in November 2011. This forum was hosted jointly by AGS, Queensland Crown Law and the Queensland Law Society. Jane spoke about a recent investigation by the Privacy Commissioner which examined issues associated with the use of cloud solutions and Tara spoke about restrictions on transborder data flow and considering the operation and impact of local laws in the cloud computing context.


Justin Davidson

Tara McNeilly

Jane Lye


Australia Day Awards 2012Each year AGS awards Australia Day Awards to employees who have made an outstanding contribution during the year.

This year’s recipients were:

Steve Webber, Senior Executive Lawyer, AGS Dispute Resolution, for his outstanding work in representing the Commonwealth in the SIEV 221 Inquiry.

Jessica Miller, Senior Lawyer, AGS Dispute Resolution, for her outstanding work in the Super Claims matters and the SIEV 221 Inquiry.

Dave Crossan, Business Manager, for outstanding work over the past 5 years in helping to build the Australian Competition and Consumer Commission (ACCC) practice.

Bianca Wellington, Counsel, Office of General Counsel (OGC), for her outstanding work in sustaining OGC’s employment law practice.

Bridget Gilmour-Walsh, Seniour General Counsel, OGC, for her outstanding work in managing one of AGS’s key clients – the Department of Health and Ageing – and also for her contribution in training junior lawyers.

Helen Curtis, Canberra team leader, AGS Commercial, for her outstanding management of our largest commercial team, mentoring of many lawyers and being a great role model to those aspiring to leadership positions in AGS.

Jessica Miller

Dave Crossan

Bridget Gilmour-Walsh

Steve Webber

Bianca Wellington

Helen Curtis

AGS at work


Robert Cole, Senior Lawyer, AGS Commercial, for his outstanding work in managing AGS’s water conveyancing practice.

Mary Bryden, Practice Administrator Outpost Services, for her consistent and tireless efforts to improve all aspects of the outpost practice.

Catherine Langman, Counsel, AGS Training, for her outstanding contribution to AGS’s pro bono program in developing and delivering capacity-building legal training to government lawyers in Papua New Guinea.

Dale Watson, Special Counsel, AGS Dispute Resolution, for her outstanding client service for the Department of Immigration and Citizenship.

Lici Inge, Senior Executive Lawyer, AGS Dispute Resolution, in recognition of her outstanding commitment and service to the ACCC.

Bronwyn Neroni, Manager Pro Bono Services, for exceptional work in project managing the national restructure and for her outstanding work in establishing and managing AGS’s pro bono practice.

The National Library Services team for their consistent and professional delivery of library services over several years.

Mary Bryden

Catherine Langman

Lici Inge

Robert Cole

Dale Watson

Bronwyn Neroni

PART 3financial

statements





AUSTRALIAN GOVERNMENT SOLICITOR

STATEMENT BY CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER

In our opinion, the attached financial statements for the year ended 30 June 2012 are based on properly maintained financial records and give a true and fair view of the matters required by the Finance Minister’s Orders made under the Commonwealth Authorities and Companies Act 1997, as amended.

In our opinion, at the date of this statement, there are reasonable grounds to believe that Australian Government Solicitor will be able to pay its debts as they become due and payable.

Ian Govey David RiggsChief Executive Officer Chief Financial Officer

31 August 2012 31 August 2012


STATEMENT OF COMPREHENSIVE INCOME for the year ended 30 June 2012

Year ended 30 June 2012

$'000

Year ended30 June 2011

$'000 Notes

INCOME

Revenue

Sale of goods and rendering of services 5A 113 579 108 572

Interest 5B 2 553 2 624

Other revenues 5C 2 138 1 919

Total revenue 118 270 113 115

Gains

Reversals of previous asset write-downs and impairments

5D

137

211

Total Income 118 407 113 326

EXPENSES

Employee benefits 6A 85 663 82 121

Suppliers 6B 20 663 17 858

Depreciation and amortisation 6C 2 458 3 693

Losses from disposal of assets 6D 114 13

Write-down and impairment of assets 6E 340 192

Other expenses 7 648 744

Total expenses 109 886 104 621

Profit before income tax 8 521 8 705

Income tax expense 8 2 792 2 799

Profit after income tax 5 729 5 906

OTHER COMPREHENSIVE INCOME

Changes in asset revaluation reserves (228) 1 012

Total comprehensive income 5 501 6 918

Total comprehensive income after income tax is attributable to the Australian Government. There are no minority interests.

The above statement should be read in conjunction with the accompanying notes.



BALANCE SHEET as at 30 June 2012


30 June 2012$'000

30 June 2011$'000Notes

ASSETS

Current assets

Cash and cash equivalents 10A 13 884 14 074

Investments under s19 of the CAC Act 10B 33 861 28 694

Receivables 11 25 792 27 054

Other current assets 12 2 278 2 009

Total current assets 75 815 71 831

Non-current assets

Infrastructure, plant and equipment 13A, C 8 971 10 138

Intangibles 13B, C 679 394

Deferred tax asset 8 7 003 5 991

Total non-current assets 16 653 16 523

Total assets 92 468 88 354

LIABILITIES

Current liabilities

Payables 16 12 900 8 409

Interest-bearing liabilities 14 582 634

Provisions 15 25 274 24 553

Total current liabilities 38 756 33 596

Non-current liabilities

Interest-bearing liabilities 14 3 267 3 848

Provisions 15 6 108 5 241

Total non-current liabilities 9 375 9 089

Total liabilities 48 131 42 685

Net assets 44 337 45 669

EQUITY

Contributed equity 22 918 22 918

Reserves 5 457 5 685

Retained earnings 15 962 17 066

Total equity 44 337 45 669



Retained earnings

Asset revaluation reserve

Contributed equity

Total equity

2012 $'000

2011 $'000

2012 $'000

2011 $'000

2012 $'000

2011 $'000

2012 $'000

2011 $'000

Opening balance

Balance carried forward from previous years

17 066 16 966 5 685 4 673 22 918 22 918 45 669 44 557

Comprehensive income

Other comprehensive income

Revaluation adjustment – – (61) 1 064 – – (61) 1 064

Transfer reserve on disposed assets

167 52 (167) (52) – – – –

Profit after income tax 5 729 5 906 – – – – 5 729 5 906

Total comprehensive income 5 896 5 958 (228) 1 012 – – 5 668 6 970

Transactions with owners

Distributions to owners

Returns on capital

Dividends (7 000) (5 858) – – – – (7 000) (5 858)

Closing balance as at 30 June 15 962 17 066 5 457 5 685 22 918 22 918 44 337 45 669


STATEMENT OF CHANGES IN EQUITY for the year ended 30 June 2012


1 Total cash and cash equivalents includes investments under section 19 of the Commonwealth Authorities and Companies Act.



STATEMENT OF CASH FLOWS for the year ended 30 June 2012



Notes $'000 $'000

OPERATING ACTIVITIES

Cash received

Legal fees and reimbursements by clients 158 043 143 798

Interest 2 407 2 778

Other cash received 2 138 1 919

Total cash received 162 588 148 495

Cash used

Employees (82 318) (82 988)

Suppliers (53 179) (51 388)

Income taxes paid (2 394) (661)

Net GST paid (9 511) (8 719)

Other cash used (647) (745)

Total cash used (148 049) (144 501)

Net cash from operating activities 17 14 539 3 994

INVESTING ACTIVITIES

Cash receivedProceeds from sale of infrastructure, plant and equipment 40 –

Total cash received 40 –

Cash used

Purchase of plant and equipment (1 969) (2 064)

Total cash used (1 969) (2 064)

Net cash used by investing activities (1 929) (2 064)

FINANCING ACTIVITIES

Cash usedRepayments of borrowings (633) (634)

Dividends paid (7 000) (5 858)

Total cash used (7 633) (6 492)

Net cash used by financing activities (7 633) (6 492)

Net increase / (decrease) in cash held 4 977 (4 562)

Cash and cash equivalents at the beginning of the reporting period

42 768

47 330

Cash and cash equivalents at the end of the reporting period 1

10

47 745

42 768



SCHEDULE OF COMMITMENTSas at 30 June 2012

1 Operating leases included are effectively non-cancellable and comprise: Nature of lease General description of leasing arrangement

Leases for office accommodation Lease payments are subject to annual or bi-annual review, either to market or be fixed increases as set out in the individual leases.

Agreements for the provision of motor vehicles No contingent rentals exist. There are no renewal or purchase for senior executives options available to AGS.

Agreements for the provision of office equipment Office equipment includes photocopiers and office machines and is leased over periods of 1 to 5 years at fixed payments.

The above schedule should be read in conjunction with the accompanying notes.

30 June 2012 30 June 2011$'000 $'000

BY TYPE

Commitments receivable

Sublease rental income 4 030 3 378

GST recoverable on commitments 9 052 8 675

Total commitments receivable 13 082 12 053

Commitments payable

Other commitments

Operating leases 1 53 484 56 049

Total other commitments 53 484 56 049

Net commitments by type 40 402 43 996

BY MATURITY

Commitments receivable

Operating lease income

1 year or less 573 787

From 1 to 5 years 1 660 1 720

Over 5 years 1 797 871

Total operating lease income 4 030 3 378

Other commitments receivable

1 year or less 1 449 1 704

From 1 to 5 years 4 425 4 349

Over 5 years 3 178 2 622

Total other commitments receivable 9 052 8 675

Total commitments receivable 13 082 12 053

Commitments payable

Operating lease commitments

1 year or less 9 558 9 465

From 1 to 5 years 28 914 27 788

Over 5 years 15 012 18 796

Total operating lease commitments 53 484 56 049

Total Commitments payable 53 484 56 049

Net commitments by maturity 40 402 43 996


30 June 2012 30 June 2011 Notes $'000 $'000

Contingent liabilities – –Contingent assets – –Net contingencies – –

Details of each class of contingent liabilities and assets, including those not disclosed above because they cannot be quantified or are considered remote, are shown in Note 19: Contingent liabilities and assets.

The above schedule should be read in conjunction with the accompanying notes.


SCHEDULE OF CONTINGENCIES as at 30 June 2012




NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTSfor the year ended 30 June 2012

Contents

1 Summary of significant accounting policies

2 Segment reporting

3 Economic dependency

4 Events after the Balance Sheet date

5 Income

6 Expenses

7 Operating expenses – other

8 Income tax

9 Dividends provided for and paid

10 Cash, cash equivalents and investments

11 Receivables

12 Other current assets

13 Non-current assets

14 Interest bearing liabilities

15 Provisions

16 Payables

17 Cash flow reconciliation

18 Client and third party funds

19 Contingent liabilities and assets

20 Key management personnel remuneration

21 Remuneration of auditors

22 Financial instruments

1. Summary of Significant accounting policieS

1.1 Objective of Australian Government SolicitorAustralian Government Solicitor (AGS) is a for-profit Australian Government controlled entity. AGS is the leading provider of legal and related services to the Australian Government and its agencies. Operating on a fully commercial and competitive basis, we are one of Australia’s largest national legal practices, with an office in every capital city.AGS is a statutory authority, within the Attorney-General’s portfolio, established under the Judiciary Act 1903. We are subject to the reporting and accountability requirements of the Commonwealth Authorities and Companies Act 1997.AGS is also a government business enterprise as prescribed by regulations made under the Commonwealth Authorities and Companies Act. AGS has 2 shareholder ministers, the Attorney-General and the Minister for Finance and Deregulation.AGS acts primarily for Australian Government agencies, and for entities in which the Australian Government has an interest. AGS also acts for State and Territory government organisations at their executive government’s request. The continued existence of AGS with its present scope of operation is dependent on Government policy.

1.2 Basis of preparation of the financial statementsThe financial statements are general purpose financial statements and are required by clause 1(b) of Schedule 1 to the Commonwealth Authorities and Companies Act.The financial statements have been prepared in accordance with:– Finance Minister’s Orders (FMOs) for reporting periods

ending on or after 1 July 2011– Australian Accounting Standards and Interpretations

issued by the Australian Accounting Standards Board that apply for the reporting period.

The financial statements have been prepared on an accrual basis and are in accordance with historical cost convention except for certain assets and liabilities at fair value. Except where stated, no allowance is made for the effect of changing prices on the results or the financial position.The financial report is presented in Australian dollars and values are rounded to the nearest thousand dollars unless otherwise specified.Unless an alternative treatment is specifically required by an accounting standard or the FMOs, assets and liabilities are recognised in the balance sheet when and only when it is probable that future economic benefits will flow to AGS or a future sacrifice of economic benefits will be required and the amounts of the assets or liabilities can be reliably measured. However, assets and liabilities arising under executory contracts are not recognised unless required by an accounting standard.

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reporting periods are expected to have a future financial impact on AGS.

1.5 RevenueRevenue from the provision of legal services is recognised when time is recorded on matters, as the amounts of revenue can be reliably measured and it is probable that economic benefits will flow to AGS.Interest revenue is recognised using the effective interest method as set out in AASB 139 Financial Instruments: Recognition and Measurement.Other revenue is recognised when received or due and receivable. Recoveries of disbursements and the associated expense have been recognised in the financial statements. AGS incurs expenses on behalf of clients associated with the provision of legal services. These expenses total $25,719,000 ($25,362,000 for the year ended 30 June 2011) and are billed to the clients on a cost recovery basis. They are disclosed in notes 5A and 6B and the flow of funds is shown in the Statement of Cash Flows. Revenue from disposal of non-current assets is recognised when control of the asset has passed to the buyer.Receivables for goods and services, which have 30 day terms, are recognised at the nominal amounts due less any impairment allowance account. Collectability of debts is reviewed at balance date. Allowances are made when collectability of the debt is no longer probable.

1.6 GainsSales of assetsGains from disposal of assets are recognised when control of the asset has passed to the buyer.

1.7 Transactions with the Australian Government as owner

At 30 June 2012, AGS has not provided a liability for a final dividend for the current year. The amount and timing of the final dividend payment is subject to discussion with and agreement by shareholders.

1.8 Employee benefitsBenefitsLiabilities for short-term employee benefits (as defined by AASB 119 Employee Benefits) and termination benefits due within 12 months of the end of reporting period are measured at their nominal amounts.The nominal amount is calculated with regard to the rates expected to be paid on settlement of the liability. Other long-term employee benefits are measured as the net total of the present value of the defined benefit obligation at the end of the reporting period minus the fair value at the end of the reporting period of plan assets (if any) out of which the obligations are to be settled directly.

LeaveThe liability for employee entitlements includes provision for recreation leave and long service leave. No provision


Liabilities and assets that are unrecognised are reported in the schedule of commitments and the schedule of contingencies.Unless alternative treatment is specifically required by an accounting standard, income and expenses are recognised in the Statement of Comprehensive Income when and only when the flow, consumption, or loss of economic benefits has occurred and can be reliably measured.

1.3 Significant accounting judgments and estimatesIn the process of applying the accounting policies listed in this note, AGS has made the following judgments that have the most significant impact on the amounts recorded in the financial statements:The fair value of leasehold improvements has been taken to be the market value of similar properties as determined by an independent valuer.Surplus lease provisions raised require estimates of the likelihood and extent of future potential rentals of the identified surplus space. As such these estimates may require revision in following years as the state of the rental markets change.The liability for long service leave has been determined by reference to the shorthand method prescribed in the FMOs as at 30 June 2012. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation. Infrastructure, plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not materially differ with the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets. No accounting assumptions or estimates have been identified that have a significant risk of causing a material adjustment to carrying amounts of assets and liabilities within the next reporting period.

1.4 New accounting standardsAdoption of new Australian Accounting Standard requirements No accounting standard has been adopted earlier than the application date as stated in the standard. No new or revised standards, amending standards or interpretations that were issued prior to signing of the statement by the Chief Executive Officer and Chief Financial Officer which are applicable to the current reporting period have a financial impact, or are expected to have a future financial impact on AGS.

Future Australian Accounting Standard requirementsNo new or revised standards, amending standards or interpretations that were issued prior to signing of the statement by the Chief Executive Officer and Chief Financial Officer which are applicable to the future


has been made for sick leave as all sick leave is non-vesting and the average sick leave taken in future years by employees of AGS is estimated to be less than the annual entitlement for sick leave.The leave liabilities are calculated on the basis of employees’ remuneration at the estimated salary rates that will apply at the time the leave is taken, including AGS’s employer superannuation contribution rates to the extent that the leave is likely to be taken during service rather than paid out on termination.The liability for long service leave has been determined by reference to the shorthand method prescribed in the FMOs as at 30 June 2012. The estimate of the present value of the liability takes into account attrition rates and pay increases through promotion and inflation.

Separation and redundancyProvision is made for separation and redundancy payments. AGS recognises a provision for termination when it has developed a detailed formal plan for the terminations and has informed those employees affected that it will carry out the terminations.Provision for separation and redundancy of $1 146 000 was made at 30 June 2012 ($Nil in 2011).

SuperannuationEmployees of AGS are members of the Commonwealth Superannuation Scheme (CSS), the Public Sector Superannuation Scheme (PSS), or to a scheme determined by the employee, or in default of nomination by the employee, a scheme nominated by AGS.The CSS and PSS are defined benefit schemes for the Australian Government. Other super schemes are defined contribution schemes.The liability for defined benefits is recognised in the financial statements of the Australian Government and is settled by the Australian Government in due course. This liability is reported by the Department of Finance and Deregulation’s administered schedule and notes.AGS makes employer contributions to the employee superannuation schemes of:– the Australian Government, at rates determined by an

actuary to be sufficient to meet the current cost to the Government. AGS accounts for the contributions as if they were contributions to defined contribution plans

– non-Australian-Government funds, as determined by the current AGS enterprise agreement.

The liability for superannuation recognised as at 30 June represents outstanding contributions for the final fortnight of the year.

1.9 LeasesA distinction is made between finance leases and operating leases. Finance leases effectively transfer from the lessor to the lessee substantially all the risks and rewards incidental to ownership of leased non-current assets. An operating lease is a lease that is not a finance lease. In operating leases, the lessor effectively retains substantially all such risks and benefits.

Where an asset is acquired by means of a finance lease, the asset is capitalised at either the fair value of the lease property or, if lower, the present value of minimum lease payments at the inception of the contract and a liability recognised at the same time and for the same amount. The discount rate used is the interest rate implicit in the lease. Leased assets are amortised over the period of the lease. Lease payments are allocated between the principal component and the interest expense.Operating lease payments are expensed on a straight line basis which is representative of the pattern of benefits derived from the leased assets. Lease incentives taking the form of ‘free’ leasehold improvements and rent holidays are recognised as liabilities. These liabilities are reduced by allocating lease payments between rental expense and reduction of the liability.

1.10 Borrowing costsAll borrowing costs are expensed as incurred. During the year AGS had no loans.

1.11 CashCash is recognised at its nominal amounts.Cash and cash equivalents includes:– cash on hand– demand deposits in bank accounts with an original

maturity of 3 months or less that are readily convertible to known amounts of cash and subject to insignificant risk of changes in value.

Cash and cash equivalents exclude investments under section 19 of the Commonwealth Authorities and Companies Act.

1.12 Financial assets AGS classifies its financial assets in the following categories:– held-to-maturity investments – loans and receivables.

The classification depends on the nature and purpose of the financial assets and is determined at the time of initial recognition.Financial assets are recognised and derecognised upon trade date.

Effective interest method The effective interest method is a method of calculating the amortised cost of a financial asset and of allocating interest income over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset, or, where appropriate, a shorter period. Income is recognised on an effective interest rate basis.



Held-to-maturity investments Non-derivative financial assets with fixed or determinable payments and fixed maturity dates that AGS has the positive intent and ability to hold to maturity are classified as held-to-maturity investments. Held-to-maturity investments are recorded at amortised cost using the effective interest method less impairment, with revenue recognised on an effective yield basis.

Loans and receivables Trade receivables, loans and other receivables that have fixed or determinable payments that are not quoted in an active market are classified as ‘loans and receivables’. Loans and receivables are measured at amortised cost using the effective interest method less impairment. Interest is recognised by applying the effective interest rate.

Impairment of financial assetsFinancial assets are assessed for impairment at the end of each reporting period. Financial assets held at amortised cost If there is objective evidence that an impairment loss has been incurred for loans and receivables or held to maturity investments held at amortised cost, the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows discounted at the asset’s original effective interest rate. The carrying amount is reduced by way of an allowance account. The loss is recognised in the Statement of Comprehensive Income.

1.13 Financial liabilities Financial liabilities are classified as other financial liabilities.Financial liabilities are recognised and derecognised upon trade date.

Other financial liabilities Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. These liabilities are subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis.The effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability, or, where appropriate, a shorter period.Supplier and other payables are recognised at amortised cost. Liabilities are recognised to the extent that the goods or services have been received (and irrespective of having been invoiced).

1.14 Contingent liabilities and contingent assetsContingent liabilities and contingent assets are not recognised in the balance sheet but are reported in the relevant schedules and notes. They may arise from uncertainty as to the existence of a liability or asset or represent an asset or liability in respect of which the amount cannot be reliably measured. Contingent assets are disclosed when settlement is probable but not virtually certain and contingent liabilities are disclosed when settlement is greater than remote.

1.15 Acquisition of assetsAssets are recorded at cost on acquisition except as stated below. The cost of acquisition includes the fair value of assets transferred in exchange and liabilities undertaken. Financial assets are initially measured at their fair value plus transaction costs where appropriate.Assets acquired at no cost, or for nominal consideration, are initially recognised as assets and income at their fair value at the date of acquisition.

1.16 Infrastructure, plant and equipmentAsset recognition thresholdPurchases of infrastructure, plant and equipment are recognised initially at cost in the balance sheet, where the equipment has a useful economic life greater than 12 months and the type of asset collectively represents a significant investment of AGS funds. Other purchases are expensed in the year of acquisition.The initial cost of an asset includes an estimate of the cost of dismantling and removing the item and restoring the site on which it is located. This is particularly relevant to ‘make-good’ provisions in property leases taken up by AGS where there exists an obligation to restore the property to its original condition. These costs are included in the value of AGS leasehold improvements with a corresponding provision for the ‘make-good’ taken up.

RevaluationsFair values for each class of assets are determined as shown below.

Asset class Fair value measured at:

Library Market selling price

Leasehold improvements Depreciated replacement cost

Infrastructure, plant and equipment

Market selling price

Following initial recognition at cost, property, plant and equipment are carried at fair value less subsequent accumulated depreciation and accumulated impairment losses. Valuations are conducted with sufficient frequency to ensure that the carrying amounts of assets do not materially differ with the assets’ fair values as at the reporting date. The regularity of independent valuations depends upon the volatility of movements in market values for the relevant assets.



The recoverable amount of an asset is the higher of its fair value less costs to sell and its value in use. Value in use is the present value of the future cash flows expected to be derived from the asset. Where the future economic benefit of an asset is not primarily dependent on the asset’s ability to generate future cash flows, and the asset would be replaced if AGS were deprived of the asset, its value in use is taken to be its depreciated replacement cost.No indicators of impairment were found for assets at fair value.

DerecognitionAn item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal.

1.17 IntangiblesAGS intangibles comprise internally developed software for internal use and purchased software. These assets are carried at cost less accumulated amortisation and accumulated impairment loss.Software is amortised on a straight-line basis over their anticipated useful lives. The useful lives of AGS’s software are 3 to 7 years (2010–11: 3 to 7 years).All software assets were assessed for indications of impairment as at 30 June 2012. No indicators of impairment were found.

1.18 Taxation / Competitive NeutralityAGS is exempt from all State and Territory taxation. It is liable for income tax, fringe benefit tax and for goods and services tax (GST). Revenues, expenses and assets are recognised net of GST except:– where the amount of GST incurred is not recoverable

from the Australian Taxation Office– for receivables and payables.

Competitive neutrality So that AGS does not have a competitive advantage over private sector legal practices these financial statements include charges representing the full value of these items shown under the categories to which they relate. Amounts identified as competitive neutrality expenses are paid to consolidated revenue each year and are recorded in the financial statements as a liability to the extent that they are unpaid at 30 June 2012.

1.19 InsuranceAGS is aware of the potential for losses arising from its normal operations as a legal practice and has taken out insurance arrangements designed to ensure that the risk of adverse effect on the profits, assets and cash flow is immaterial to the continuing operations of AGS. Workers compensation is insured through Comcare Australia.


Revaluation adjustments are made on an asset by asset basis as AGS is a for-profit entity. Any revaluation increment is credited to equity under the heading of asset revaluation reserve except to the extent that it reverses a previous revaluation decrement of the same asset that was previously recognised through operating result. Revaluation decrements for each asset are recognised directly through operating result except to the extent that they reverse a previous revaluation increment for that asset.Any accumulated depreciation as at the revaluation date for library and infrastructure, plant and equipment assets are eliminated against the gross carrying amount and the asset restated to the revalued amount. Any accumulated depreciation as at the revaluation date for leasehold assets is restated proportionately with the change in the gross carrying amount of the asset so that the carrying amount of the asset after revaluation equals its revalued amount.

DepreciationDepreciable infrastructure, plant and equipment assets are written-off to their estimated residual values over their estimated useful lives to AGS using, in all cases, the straight line method of depreciation. Leasehold improvements are depreciated on a straight-line basis over the lesser of the estimated useful life of the improvements or the unexpired period of the lease.Depreciation rates (useful lives), residual values and methods are reviewed at each reporting date and necessary adjustments are recognised in the current, or current and future reporting periods, as appropriate. Depreciation rates applying to each class of depreciable asset are based on the following useful lives:

2011–12 2010–11Library 7–10 years 6–10 years

Leasehold improvements lease term lease term

Other infrastructure, plant and equipment– Computer equipment 3–7 years 3–7 years

– Other plant and equipment 5–10 years 5–10 years

The aggregate amount of depreciation allocated for each class of asset during the reporting period is disclosed in Note 6C.

ImpairmentAll assets were assessed for impairment at 30 June 2012. Where indications of impairment exist, the asset’s recoverable amount is estimated and an impairment adjustment made if the asset’s recoverable amount is less than its carrying amount.


1.20 Income tax Current tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities, based on the current period’s taxable income. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the reporting date. Deferred income tax is provided on all temporary differences at the reporting date between the tax bases of assets and liabilities and their carrying amounts for financial reporting purposes. Deferred income tax assets are recognised for all deductible temporary differences to the extent that it is probable that taxable profit will be available against which the deductible temporary differences can be utilised.The carrying amount of deferred income tax assets is reviewed at each reporting date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilised.Deferred income tax assets are measured at the tax rates that are expected to apply to the year when the asset is realised or the liability is settled, based on tax rates (and tax laws) that have been enacted or substantively enacted at the reporting date. Deferred tax assets and deferred tax liabilities are offset only if a legally enforceable right exists to set- off current tax assets against current tax liabilities and the deferred tax assets and liabilities relate to the same taxable entity and the same taxation authority. The deferred tax asset is recorded in the balance sheet at a full value of $7,003,000 at 30 June 2012 ($5,991,000 at 30 June 2011) on the assumption that future profits and tax liabilities may be available against which the asset may be realised.

2. Segment reportingThe principal activity of AGS is the provision of legal and related services. AGS operates in every Australian capital city. Each office provides a similar range of services and serves principally Commonwealth Government clients. The majority of such services are provided under nationally negotiated contractual arrangements.AGS regards the appropriate unit for segment reporting to be all legal and related services delivered by AGS from its Australian offices.

3. economic dependencyOn 1 September 1999 AGS was established as a government business enterprise under the Commonwealth Authorities and Companies Act. AGS’s continued ability to carry out its normal activities is dependent upon fees received from clients, principally Commonwealth agencies.

4. eventS after the balance Sheet dateThere was no subsequent event that had the potential to significantly affect the ongoing structure and financial activities of AGS.


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5. income

Note 5A – Sale of goods and rendering of services

Legal fees and disbursements recovered or recoverable on behalf of clients

139 298 133 934

Disbursements recovered or recoverable on behalf of clients (refer Note 1.5)

(25 719) (25 362)

Total operating revenues 113 579 108 572

Rendering of services to:

Related entities 108 825 103 548

External entities 4 754 5 024

Total rendering of services 113 579 108 572

Note 5B – Interest

Deposits in AGS accounts 2 337 2 339

Deposits in client and third party accounts (refer Note 18) 216 285

Total interest 2 553 2 624

Note 5C – Other revenues

Reimbursements and miscellaneous receipts 1 335 1 367

Rental income 803 552

Total other revenues 2 138 1 919

Note 5D – Reversals of previous asset write-downs and impairments

Asset revaluation increments from revaluation

Library 25 50

Plant and equipment written-up on revaluation 112 161

Asset revaluation increments from revaluation 137 211

6. expenSeS

Note 6A – Employee benefits

Wages and salaries 62 893 61 884

Superannuation 8 752 8 611

Leave and other entitlements 8 220 7 360

Separation and redundancy 1 433 –

Competitive neutrality – State payroll tax equivalence expense 4 365 4 266

Total employee benefits 85 663 82 121



$'000 $'000


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Note 6B – Suppliers

Supply of goods and services and disbursements paid or payable on behalf of clients

38 139 36 140

Disbursements paid or payable on behalf of clients (refer Note (25 719) (25 362)

Property lease rentals – minimum lease payments 7 505 7 516

Surplus lease expense 193 (928)

Workers compensation premiums 405 363

Competitive neutrality – regulatory neutrality expense 140 129

Total suppliers 20 663 17 858

Rendering of services from:

Related entities 745 643

External entities 19 918 17 215

Total rendering of services 20 663 17 858

Note 6C – Depreciation and amortisation

Depreciation:

Library 38 49

Leasehold improvements 1 457 1 656

Infrastructure, plant and equipment 776 1 582

Total depreciation 2 271 3 287

Amortisation:

Intangibles

Computer software 187 406

Total amortisation 187 406

Total depreciation and amortisation 2 458 3 693

Note 6D – Losses from disposal of assets

Infrastructure, plant and equipment

Proceeds from disposal (40) –

Net book value of assets disposed 154 13

Total (net) losses from sales of assets 114 13

Note 6E – Write-down and impairment of assets

Asset write downs and impairments from:

Impairment loss expense – receivables 45 42

Impairment loss expense – assets 100 –

Revaluation decrement – leasehold improvements 101 –

Revaluation decrement – infrastructure, plant and equipment 94 150

Total write-down and impairment of assets 340 192




$'000 $'000


7. operating expenSeS – other

Insurance 566 662

Competitive neutrality – State insurance duty equivalence expense

82 82

Total operating expenses – other 648 744

8. income tax

Prima facie income tax payable on accounting profit at 30% 2 557 2 612

Tax effect of expenses that are not deductible for tax purposes 235 158

Underprovision for income tax for prior year – 29

Income tax expense 2 792 2 799

Income tax expense comprises:

Provision for taxation 2 620 1 209

Provisional tax payments made 1 184 151

Underprovision for income tax for prior year – 29

Movement in deferred tax asset for current year (1 012) 1 410

Income tax expense 2 792 2 799

Deferred tax asset 7 003 5 991

9. dividendS provided for and paid

Final dividend 2009–10 – 2 358

Interim dividend 2010–11 – 3 500

Final dividend 2010–11 3 500 –

Interim dividend 2011–12 3 500 –

Total dividends provided for and paid 7 000 5 858

10. caSh, caSh equivalentS and inveStmentS

Note 10A – Cash and cash equivalents

Cash balance comprises:

Cash at bank and on hand 13 884 14 074

Total cash and cash equivalents 13 884 14 074




$'000 $'000

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Note 10B – Investments under s19 of the CAC Act

Investments comprise:

Term deposits with an original maturity of greater than 3 months and less than 1 year

33 861

28 694

Total investments under s19 of the CAC Act 33 861 28 694

Total cash, cash equivalents and investments 47 745 42 768

11. receivableS

Goods and services 20 167 23 190

Less: impairment allowance account (298) (253)

19 869 22 937

Other debtors 5 447 3 787

Interest 476 330

5 923 4 117

Total receivables (net) 25 792 27 054

All receivables are expected to be recovered in no more than 12 months.

Receivables (gross) are aged as follows:

Not overdue 21 984 22 956

Overdue by:

– less than 30 days 2 633 1 682

– 30 to 60 days 609 1 389

– 60 to 90 days 266 329

– more than 90 days 598 951

4 106 4 351

Total receivables (gross) 26 090 27 307

The impairment allowance account is aged as follows:

Not overdue (173) (163)

Overdue by:

– less than 30 days (7) –

– 30 to 60 days (19) (4)

– 60 to 90 days (28) (23)

– more than 90 days (71) (63)

Total impairment allowance account (298) (253)



$'000 $'000


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11. Receivables (cont.)

Reconciliation of the impairment allowance account:

Goods and services

$'000

Goods and services

$'000

Opening balance (253) (211)

Amounts written off – 57

Amounts recovered and reversed 253 154

Increase recognised in operating profit (298) (253)

Closing balance (298) (253)

12. other current aSSetS

Prepaid property rentals 589 618

Prepaid insurance premiums 406 481

Other prepayments 1 283 910

Total other current assets 2 278 2 009

13. non-current aSSetS

Note 13A – Infrastructure, plant and equipment

Library

– at valuation (fair value) 319 328

– accumulated depreciation – –

Total library 319 328

Leasehold improvements

– at valuation (fair value) 17 046 17 290

– accumulated depreciation (11 310) (9 807)

Total leasehold Improvements 5 736 7 483

Other infrastructure, plant and equipment

– at valuation (fair value) 2 916 2 327

– accumulated depreciation – –

Total other infrastructure, plant and equipment 2 916 2 327

Total infrastructure, plant and equipment 8 971 10 138

All revaluations are conducted in accordance with the revaluation policy stated at Note 1. In 2011–12, an independent valuer conducted the revaluations.Valuations of leasehold improvements and infrastructure, plant and equipment, with the exception of the financed lease incentives, were carried out at 30 June 2012 by an independent valuer.No indicators of impairment were found for infrastructure, plant and equipment.




$'000 $'000

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As at 1 July 2011

Gross book value 328 17 290 2 327 19 945 3 532 23 477

Accumulated depreciation/amortisation – (9 807) – (9 807) (3 138) (12 945)

Net book value 328 7 483 2 327 10 138 394 10 532

Additions by purchase – 33 1 464 1 497 472 1 969

Restatement of makegood – (20) – (20) – (20)

Revaluations through equity 4 (152) 87 (61) – (61)

Revaluations through profit and loss 25 (101) 18 (58) – (58)

Impairments through profit and loss – – (100) (100) – (100)

Depreciation/amortisation expense (38) (1 457) (776) (2 271) (187) (2 458)

Disposals – (50) (104) (154) – (154)

Net book value as of 30 June 2012 represented by:

Gross book value 319 17 046 2 916 20 281 3 559 23 840


Net book value 319 5 736 2 916 8 971 679 9 650

Reconciliation of the opening and closing balances of infrastructure, plant and equipment and intangibles (2010–11)

As at 1 July 2010

Gross book value 326 16 765 2 334 19 425 3 244 22 669


Net book value 326 7 870 2 334 10 530 502 11 032


Restatement of make-good – 17 – 17 – 17

Revaluations through equity 1 973 90 1 064 – 1 064

Revaluations through profit and loss 50 – 11 61 – 61

Depreciation/amortisation expense (49) (1 656) (1 582) (3 287) (406) (3 693)

Disposals – – (13) (13) – (13)


Gross book value 328 17 290 2 327 19 945 3 532 23 477


Net book value 328 7 483 2 327 10 138 394 10 532

13. Non-current assets (cont.)

Opening Asset Revaluation Reserve 5 685 4 673

Library increment 4 1

Library decrement – –

4 1

Leasehold improvements increment 15 993

Leasehold improvements decrement (167) (19)

(152) 974

Other infrastructure, plant and equipment increment 127 184

Other infrastructure, plant and equipment decrement (40) (95)

87 89

Net change in Asset Revaluation Reserve (61) 1 064

Transfer reserve on disposed assets to Retained Earnings (167) 52

Closing Asset Revaluation Reserve 5 457 5 685

Note 13B – Intangibles

Computer software

Purchased 3 559 3 532

Accumulated amortisation (2 880) (3 138)

Total intangibles 679 394

No indicators of impairment were found for intangible assets.



$'000 $'000



As at 1 July 2011

Gross book value 328 17 290 2 327 19 945 3 532 23 477


Net book value 328 7 483 2 327 10 138 394 10 532


Restatement of makegood – (20) – (20) – (20)

Revaluations through equity 4 (152) 87 (61) – (61)

Revaluations through profit and loss 25 (101) 18 (58) – (58)

Impairments through profit and loss – – (100) (100) – (100)

Depreciation/amortisation expense (38) (1 457) (776) (2 271) (187) (2 458)

Disposals – (50) (104) (154) – (154)


Gross book value 319 17 046 2 916 20 281 3 559 23 840


Net book value 319 5 736 2 916 8 971 679 9 650


As at 1 July 2010

Gross book value 326 16 765 2 334 19 425 3 244 22 669


Net book value 326 7 870 2 334 10 530 502 11 032


Restatement of make-good – 17 – 17 – 17

Revaluations through equity 1 973 90 1 064 – 1 064

Revaluations through profit and loss 50 – 11 61 – 61

Depreciation/amortisation expense (49) (1 656) (1 582) (3 287) (406) (3 693)

Disposals – – (13) (13) – (13)


Gross book value 328 17 290 2 327 19 945 3 532 23 477


Net book value 328 7 483 2 327 10 138 394 10 532

Total

$'000Intangibles –

computer software

$'000Total other infra-

structure, plant and

equipment

$'000Other in

frastructure,

plant and equipment

$'000Leasehold

improvements

$'000Library

$'000

Note 13C – Analysis of infrastructure, plant, equipment, and intangibles


Item



14. intereSt bearing liabilitieS

Lease incentives 3 849 4 482

Lease incentives are categorised as follows:

Current 582 634

Non current 3 267 3 848

Total lease incentive liabilities 3 849 4 482

Total interest bearing liabilities 3 849 4 482

Lease incentives includes those used to finance leasehold improvements.

15. proviSionS

Employee provisions

Current

Recreation leave 5 557 5 746

Long service leave 13 981 11 782

Performance pay due 3 921 4 743

Other employee on-costs 1 481 1 459

Total current employee provisions 24 940 23 730

Non-current

Long service leave 3 997 3 576

Other employee on-costs 249 243

Total non-current employee entitlements 4 246 3 819

Total employee entitlements 29 186 27 549

Employee provisions are expected to be settled in:

No more than 12 months 9 425 11 871

More than 12 months 19 761 15 678

Total employee entitlements 29 186 27 549

The classification of current employee provisions includes amounts for which there is not an unconditional right to defer settlement by 1 year, hence in the case of employee provisions the above classification does not represent the amount expected to be settled within 1 year of the reporting date.

Lease provisions

Current:

Provision for future lease escalation 175 330

Surplus lease space 159 493

Total current lease provisions 334 823



$'000 $'000


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15. Provisions (cont.)

Non-current:

Provision for future lease escalation 840 906

Surplus lease space 862 336

Provision for makegood on lease terminations 160 180

Total non-current lease provisions 1 862 1 422

Total lease provisions 2 196 2 245

AGS currently has 9 agreements for the leasing of premises which have fixed increases. AGS has averaged the lease payments during the fixed lease terms and accrued a liability which will reverse over the same period. AGS currently has 3 premises with space identified as surplus to requirements.Surplus lease provisions raised require estimates of the likelihood and extent of future potential rentals of the identified surplus space. AGS has made a provision to reflect the present value of this obligation.AGS currently has 3 agreements for the leasing of premises which have provisions requiring AGS to restore the premises to their original condition at the conclusion of the lease.AGS has made a provision to reflect the present value of this obligation.

Total current provisions 25 274 24 553

Total non-current provisions 6 108 5 241

Total provisions 31 382 29 794



$'000 $'000



$'000 $'000


Provision for future

lease escalation

$’000

Surplus

lease space $’000

Provision for make-good

on lease terminations

$’000

Total $'000

Carrying amount at 1 July 2011 1 236 829 180 2 245

Additional provisions made 118 872 14 1 004

Amounts used (339) (403) (742)

Amounts reversed (277) (34) (311)

Unwinding of discount or change in discount rate – – – –

Closing balance 2012 1 015 1 021 160 2 196


16. payableS

Trade creditors 5 239 3 764

Salaries and wages 1 936 1 416

Superannuation 236 194

Separations and redundancies 1 146 –

Due to Consolidated Revenue Fund 508 544

GST payable to ATO 1 109 1 143

Income tax payable to ATO 2 620 1 209

FBT payable to ATO 106 139

Total payables 12 900 8 409

All payables are currentTrade creditors: Settlement is usually made net 30 days or in accordance with supplier terms of payment.

17. caSh flow reconciliation

Reconciliation of cash and cash equivalents as per balance sheet to statement of cashflows

Cash at year end per Statement of Cashflows 47 745 42 768

Balance sheet items comprising cash and cash equivalents

Cash at bank and on hand 13 884 14 074

Term deposits with an original maturity of not greater than 3 months

– –

Term deposits with an original maturity of greater than 3 months and less than one year

33 861 28 694

Total cash and cash equivalents 47 745 42 768

Profit after income tax 5 729 5 906

Non-cash items:

Depreciation and amortisation 2 458 3 693

Write-down of infrastructure, plant and equipment 195 150

Impairment of infrastructure, plant and equipment 100 –

Reversals of previous asset write-downs and impairments (137) (211)

Loss on disposal of assets 114 13

Changes in assets and liabilities:

Decrease / (increase) in receivables 1 263 (5 967)

Decrease / (increase) in Deferred Tax Asset (1 013) 1 410

Decrease / (increase) in prepayments (273) 18

Increase / (decrease) in trade creditors 4 514 871

Increase / (decrease) in employee provisions 1 637 (867)

Increase / (decrease) in lease provisions (48) (1 022)

Net cash from operating activities 14 539 3 994



$'000 $'000


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18. client and third party fundS

AGS receives money in trust for clients usually pending settlement of clients’ transactions. These moneys are not available for legal practice operating purposes and are not recognised in the financial statements. Typically client funds are held for short periods of time for transactional purposes. Exceptionally funds may be held for a longer period where a settlement is delayed or title to funds is disputed. By arrangement with our client, interest may be payable to the client or the client’s nominee or on the instructions of a court. AGS does not pay interest to its clients except where an arrangement has been made to do so.

Australian Government Solicitor client and third party funds accounts

Balance at beginning of the period 15 552 8 871

Add receipts 167 211 219 014

182 763 227 885

Less expenditure 177 731 212 333

Balance at end of the period 5 032 15 552

19. contingent liabilitieS and aSSetS

AGS is aware of the potential for losses arising from its normal operations as a legal practice and has taken out insurance arrangements designed to ensure that the risk of adverse effect on the profits, assets and cash flow is immaterial to the continuing operations of AGS (Nil at 30 June 11). At 30 June 2012, AGS considers the scale of unquantifiable or remote contingent losses or gains to be immaterial. At 30 June 2012, AGS has not provided a liability for a final dividend for the current year. The amount and timing of the final dividend payment is subject to discussion with and agreement by shareholders.



$'000 $'000


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$’000 $'000


20. Key management perSonnel remuneration

Note 20A – Key management personnel remuneration expenses for the reporting period

2012 $

2011 $

Short-term employee benefits: 6 774 337 7 250 961

Salary

Short-term employee benefits:

Salary 3 759 641 5 361 692

Annual leave accrued 291 186 398 907

4 050 826 5 760 600

Performance bonuses 428 168 650 902

Motor vehicle and other allowances 105 625 362 835

Total short-term employee benefits: 4 584 620 6 774 337

Post-employment benefits:

Superannuation 592 422 897 907

Total post-employment benefits 592 422 897 907

Other long-term benefits:

Long-service leave 93 894 128 630

Total other long-term benefits 93 894 128 630

Termination benefits 50 000 178 142

Total 5 320 936 7 979 016

Notes 1. Key management personnel remuneration includes all officers concerned with or taking part in the management of AGS

during the year and includes remuneration of the Chief Executive Officer, Senior Executives, Senior Executive Lawyers and Specialist staff having a senior business management role.

2. Remuneration includes salary, accrued leave, performance pay, accrued superannuation, the cost of motor vehicles, allowances and fringe benefits tax included in remuneration agreements.

3. Note 20A is prepared on an accrual basis (therefore the performance bonus expenses disclosed above may differ from the cash ‘Bonus paid’ in Note 20B).

4. Note 20A excludes acting arrangements and part-year service where total remuneration expensed for a manager was less than $150,000.

5. In 2011–12 AGS restructured the business to report on a functional activities basis rather than a geographic basis. As a result the amount of key manager remuneration was lower than the prior year.

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$'000 $'000


Note 20B – Average annual reportable remuneration paid to key management personnel for the reporting period

Average annual reportable remmuneration 1

Key management

personnel Reportable

salary 2Contributed

superannuation 3Reportable

allowances 4Bonus paid 5 Total

No. $ $ $ $ $

2011–12Total remunerationless than $150 000 5 109 587 16 891 – 7 229 133 707$150 000 to $179 999 2 113 355 52 672 – 10 280 176 307$180 000 to $209 999 3 153 691 31 747 – 10 237 195 675$210 000 to $239 999 1 188 663 26 334 – 14 870 229 867$240 000 to $269 999 2 197 326 27 817 – 26 951 252 094$270 000 to $299 999 3 210 257 46 621 800 26 023 283 701$300 000 to $329 999 3 247 075 37 000 – 33 523 317 598$330 000 to $359 999 1 277 619 32 411 – 35 000 345 030$360 000 to $389 999 1 254 853 89 733 – 40 701 385 287$450 000 to $479 999 1 359 190 106 304 – – 465 494

Total 22

2010–11 Total remunerationless than $150 000 4 88 750 14 154 – 8 864 111 768$150 000 to $179 999 3 130 957 27 303 – 12 947 171 207$180 000 to $209 999 5 154 205 30 412 – 12 534 197 151$210 000 to $239 999 3 165 942 42 055 – 15 281 223 278$240 000 to $269 999 4 182 551 46 333 – 24 046 252 930$270 000 to $299 999 2 214 895 38 685 150 22 370 276 100$300 000 to $329 999 2 238 887 56 587 – 26 632 322 106$330 000 to $359 999 1 270 839 35 896 – 35 000 341 735$360 000 to $389 999 5 279 975 74 393 60 20 963 375 391$450 000 to $479 999 1 346 389 108 859 – – 455 248

Total 30

Notes 1. This table reports key management personnel, including those on part-time arrangements, who received remuneration during the

reporting period. Each row is an averaged figure based on headcount for individuals in the band.

2. ‘Reportable salary’ includes the following: – gross payments (less any bonuses paid, which are separated out and disclosed in the ‘bonus paid’ column) – reportable fringe benefits (at the net amount prior to ‘grossing up’ to account for tax benefits) – exempt foreign employment income.

3. The ‘contributed superannuation’ amount is the average actual superannuation contributions paid to management personnel in that reportable remuneration band during the reporting period, including any salary sacrificed amounts, as per the individuals’ payslips.

4. ‘Reportable allowances’ are the average actual allowances paid as per the ‘total allowances’ line on individuals’ payment summaries.

5. ‘Bonus paid’ represents average actual bonuses paid during the reporting period in that reportable remuneration band. The ‘bonus paid’ within a particular band may vary between financial years due to various factors such as individuals commencing with or leaving AGS during the financial year.

6. Various salary sacrifice arrangements were available to key management personnel including superannuation, motor vehicle and expense payment fringe benefits. Salary sacrifice benefits are reported in the ‘reportable salary’ column, excluding salary sacrificed superannuation, which is reported in the ‘contributed superannuation’ column.

7. In 2011–12 AGS restructured the business to report on a functional activities basis rather than a geographic basis. As a result the number of key managers were reduced from the prior year.



Note 20C – Other highly paid staff

Average annual reportable remmuneration 1 Staff

Reportable salary 2

Contributed superannuation 3

Reportable allowances 4

Bonus paid 5 Total

No. $ $ $ $ $

2011–12$150 000 to $179 999 36 130 934 20 642 71 12 530 164 178$180 000 to $209 999 33 153 942 31 925 64 9 927 195 857$210 000 to $239 999 27 174 978 29 763 83 15 422 220 246$240 000 to $269 999 14 192 031 45 273 116 14 680 252 100$270 000 to $299 999 5 218 242 31 568 – 36 118 285 928$300 000 to $329 999 2 231 932 33 758 450 49 835 315 975$330 000 to $359 999 2 228 722 89 145 – 23 311 341 178$360 000 to $389 999 4 280 690 60 041 – 29 817 370 548$390 000 to $419 999 1 300 013 80 924 – 10 543 391 480

Total 124

2010–11$150 000 to $179 999 37 128 627 23 985 1 10 399 163 013$180 000 to $209 999 42 151 948 31 343 106 9 777 193 175$210 000 to $239 999 16 172 603 37 306 75 13 124 223 108$240 000 to $269 999 10 191 266 46 260 – 14 322 251 848$270 000 to $299 999 6 198 865 38 755 550 42 266 280 435$300 000 to $329 999 3 234 266 54 651 – 26 128 315 045$360 000 to $389 999 1 269 386 49 902 1 224 57 478 377 990

Total 115

Notes 1. This table reports staff: a) who were employed by AGS during the reporting period, including those on part-time arrangements b) whose reportable remuneration was $150,000 or more for the financial period c) were not required to be disclosed in Tables A or B. Each row is an averaged figure based on headcount for individuals in the band.

2. ‘Reportable salary’ includes the following: a) gross payments (less any bonuses paid, which are separated out and disclosed in the ‘bonus paid’ column) b) reportable fringe benefits (at the net amount prior to ‘grossing up’ to account for tax benefits) c) exempt foreign employment income.

3. The ‘contributed superannuation’ amount is the average actual superannuation contributions paid to staff in that reportable remuneration band during the reporting period, including any salary sacrificed amounts, as per the individuals’ payslips.

4. ‘Reportable allowances’ are the average actual allowances paid as per the ‘total allowances’ line on individuals’ payment summaries.

5. ‘Bonus paid’ represents average actual bonuses paid during the reporting period in that reportable remuneration band. The ‘bonus paid’ within a particular band may vary between financial years due to various factors such as individuals commencing with or leaving AGS during the financial year.

6. Various salary sacrifice arrangements were available to other highly paid staff including superannuation, motor vehicle and expense payment fringe benefits. Salary sacrifice benefits are reported in the ‘reportable salary’ column, excluding salary sacrificed superannuation, which is reported in the ‘contributed superannuation’ column.



$’000 $'000



21. remuneration of auditorS

Remuneration to the Auditor-General for auditing the financial statements for the reporting period.

The fair value of services provided was: 130 130

No other services were provided by the Auditor-General during the reporting period.

22. financial inStrumentS

22A – Categories of financial instruments



Notes $'000 $'000

Financial assets

Held-to-maturity

Total cash and cash equivalents and investments 10B 47 745 42 768

Loans and receivables

Receivables – goods and services 11 20 167 23 190

Receivables – interest 11 476 330

Receivables – other debtors 11 5 447 3 787

Carrying amount of financial assets 73 835 70 075

Financial liabilities

At amortised cost:

Lease incentives 14 3 849 4 482

Trade creditors 16 5 239 3 764

Carrying amount of financial liabilities 9 088 8 246

22B – Net income and expense from financial assets

Held-to-maturity

Interest revenue 5B 2 553 2 624

Net gain from financial assets 2 553 2 624



$'000 $'000

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22C – Net income and expenses from financial liabilities


Lease incentives – –

Trade creditors – –

Dividend payable – –

Net gain/(loss) from financial liabilities – –

22D – Fair value of financial instruments


Lease incentives 14 3 849 4 482

Trade creditors 16 5 239 3 764

Total 9 088 8 246

Financial assets: The fair value is the same as the carrying amounts in the balance sheet.

22E – Credit risk exposures AGS is exposed to minimal credit risk as the majority of receivables are due from Commonwealth agencies. The maximum exposure to credit risk is the risk that arises from potential default of a debtor or non-collectability of debt amounts. This amount is equal to the total amount of receivables totalling $25,792,000 ($27,054,000 in 2011). AGS has assessed the risk of the non-collectability of debt amounts and has allocated $298,000 ($253,000 in 2011) to an impairment allowance account.AGS has policies and procedures in place for the recovery of debt.AGS holds no collateral to mitigate against credit risk. The majority of AGS receivables are low credit risk, relating to debt and work in progress for the Commonwealth.

Credit quality of financial instruments not past due or individually determined as impaired:

Notes

Not past due nor

impaired2012

$'000

Not past due nor

impaired2011

$'000

Past due or

impaired2012

$'000

Past due or

impaired2011

$'000

Total cash and cash equivalents and investments

10B

47 745

42 768

–

–

Receivables – goods and services 11 16 061 18 839 4 106 4 351

Receivables – interest 11 476 330 – –

Receivables – other debtors 11 5 447 3 787 – –

Total 69 729 65 724 4 106 4 351



$’000 $'000





$'000 $'000

Ageing of financial assets that are past due but not impaired for 2012

Notes

0 to 30 days

$'000

31 to 60 days

$'000

61 to 90 days

$'000

90+ days

$'000

Total$'000

Receivables – goods and services 11 2 633 609 266 598 4 106

Total 2 633 609 266 598 4 106

Ageing of financial assets that are past due but not impaired for 2011

Notes

0 to 30 days

$'000

31 to 60 days

$'000

61 to 90 days

$'000

90+ days

$'000

Total$'000

Receivables – goods and services 11 1 682 1 389 329 951 4 351

Total 1 682 1 389 329 951 4 351

22F – Liquidity risk AGS financial liabilities are payables and other interest-bearing liabilities. The exposure to liquidity risk is based on the notion that AGS will encounter difficulty in meeting its obligations associated with financial liabilities.AGS manages liquidity risk throughout the year by monitoring cash and deposit balances and the timing of the due date for major liabilities.Cash is invested at higher rates of interest to the extent possible to meet working cash requirements and the larger dividend and taxation obligations as they fall due.

The following table illustrates the maturities for non-derivative financial liabilities 2012 Within 1 to 5 > 5 1 year years years Total Notes $’000 $’000 $’000 $’000Lease incentives 14 582 3 267 – 3 849Trade creditors 16 5 239 – – 5 239Dividend payable 16 – – – – Total 5 821 3 267 – 9 088 The following table illustrates the maturities for non-derivative financial liabilities 2011

Within 1 to 5 > 5 1 year years years Total Notes $’000 $’000 $’000 $’000Lease incentives 14 634 3 848 – 4 482Trade creditors 16 3 764 – – 3 764Dividend payable 16 – – – – Total 4 398 3 848 – 8 246 AGS has no derivative financial liabilities in both the current and prior year.



22G – Market risk AGS holds basic financial instruments that do not expose AGS to certain market risks. AGS is not exposed to significant ‘currency risk’ or ‘other price risk’. Interest rate riskAGS term deposits are undertaken in consideration of the interest rate risk associated with changing market interest rates.The only interest-bearing items on the balance sheet are interest-bearing liabilities in relation to lease incentives. The amortisation schedule for lease incentives is fixed over the term of the lease and there is no associated interest expense.



$’000 $'000

PART 4appendixes and indexes



Forums and publications FORUMSProperty and infrastructure forum, Canberra, 11 August 2011

Competition and consumer law forum, Sydney, 19 August 2011

Administrative law symposium, Melbourne 13 October 2011

Migration law forum, Canberra, 8 November 2011

Constitutional law forum, Canberra, 16 November, 2011

What’s in the clouds? Cloud computing forum, Brisbane, 17 November 2011

FOI and privacy practitioner forum, Melbourne, 24 November 2011

Employment law forum, Canberra, 30 November 2011

Compensation law forum, Canberra, 23 February 2012

FOI and privacy practitioner forum, Melbourne, 8 March 2012

Competition and consumer law forum, Canberra, 28 May 2012

GOVERNMENT LAW GROUP MEETINGSPersonal Property Securities Register, Canberra, 18 August 2011

Responding to subpoenas, Melbourne, 8 September 2011

Clearer laws – Acts Interpretation Amendment Act 2011, Canberra, 19 September 2011

How to deal with a dodgy contractor: strategies and issues for dealing with problem contracts, Canberra, 27 October 2011

Negotiating the cloud: Issues in cloud computing, Canberra, 8 December 2011

Human rights in Commonwealth law-making and interpretation, Canberra, 23 February 2012

Clean energy legislation, Canberra, 22 March 2012

Recent developments in Commonwealth procurement, Canberra, 3 May 2012

Personal Property Securities Register, Melbourne, 23 May 2012

Personal Property Securities Register, Sydney, 24 May 2012

Recent developments in Commonwealth procurement, Sydney, 20 June 2012

Recent developments in Commonwealth procurement, Melbourne, 21 June 2012

Protections, privileges and pitfalls in the use of information, Canberra, 28 June 2012

PUBLICATIONS

Express Law newslettersNo. 133 Government releases clean energy legislation exposure drafts, 29 July 2011

No. 134 Federal Court rules on parliamentary privilege and waiver of legal professional privilege, 29 August 2011

No. 135 Inconsistency of Commonwealth and State laws, 13 September 2011

>


No. 136 Government introduces clean energy legislation into Parliament ,14 September 2011

No. 137 Two new national bodies to regulate offshore petroleum operations and titles, 15 September 2011

No. 138 New national electricity and gas retail supply arrangements to be applied by the Commonwealth, 21 September 2011

No. 139 When is a government charge a tax?, 13 October 2011

No. 140 New human rights obligations for agencies, 25 November 2011

No. 141 Recent amendments extend Auditor-General’s powers of review and audit, 20 December 2011

No. 142 New work health and safety laws now in operation, 5 January 2012

No. 143 New Personal Property Securities Register commences on 30 January 2012, 20 January 2012

No. 144 Public holidays in South Australia, 7 February 2012

No. 145 Proposed new oversight, review and conduct provisions for the Australian Public Service, 1 March 2012

No. 146 Clean Energy legislation, 22 March 2012

No. 147 Taking genuine steps statements seriously, 13 April 2012

No. 148 New Commonwealth Procurement Rules, 16 April 2012

No. 149 Copyright inquiry draft terms of reference released for public comment, 18 April 2012

No. 150 Federal Court decision on the service of documents by post, 1 May 2012

No. 151 High Court decision on the duties of corporate officers, 8 May 2012

No. 152 Updated Australian Government intellectual property guidance for agencies, May 2012

No. 153 Proposed amendments to the Privacy Act 1988, 30 May 2012

No. 154 New gTLD applications – objection period now open, 15 June 2012

No. 155 Legislation enacted today in response to High Court’s decision in Williams v Commonwealth, 28 June 2012

No. 156 National Energy Retail Law to commence on 1 July 2012, 29 June 2012

OTHER PUBLICATIONSFact sheet no. 1 (updated): Commonwealth legislation that may apply to Australian Government contractors, May 2012

Fact sheet no. 2 (updated): Probity and legal process advice, August 2011

Fact sheet no. 3 (updated): Lands Acquisition Act 1989, August 2011

Fact sheet no. 4 (updated): Financial Management and Accountability Act issues in Commonwealth property transactions, May 2012

Fact sheet no. 5 (updated): Negotiating indemnities in leases, August 2011

Fact sheet no. 6 (updated) Managing GST in Commonwealth property transactions: be aware of the risks, July 2011

Fact sheet no. 7 (updated): Commonwealth Procurement Guidelines, May 2012

Fact sheet no. 8 (updated): Commonwealth legislation that may apply to Australian Government funding recipients, May 2012


Fact sheet no. 9 (updated): Probity and process issues for property and infrastructure projects, May 2012

Fact sheet no. 13: Tips for new Commonwealth authorities, May 2012

Fact sheet no. 14: Avoiding common legal pitfalls in contract management, October 2011

Fact sheet no. 15: Tips for new Commonwealth agencies, August 2011

Fact sheet no. 16: Managing problem contracts in government, October 2011

Fact sheet no. 17: Work, Health & Safety – Officer’s duty, November 2011

Fact sheet no. 18: Work, Health & Safety – Procurement, November 2011, updated May 2012

Fact sheet no. 19: Work, Health & Safety – HR managers, November 2011

Commercial Notes no. 35: Managing government contracts through financial distress, 31 May 2012

Legal Briefing no. 93: How risk can be allocated and managed through the use of transactional documents such as contracts and leases, and in particular by a type of contractual clause known as an indemnity, 19 August 2011

Legal Briefing no. 94: The Personal Property Securities Register – a new national system regulating security interests over personal property, 12 January 2012

Legal Briefing no. 95: Parliamentary privilege, 26 June 2012

Litigation Notes No. 21: Inconsistency between Commonwealth and State long service leave provisions; What is a tax?; Remedial legislation after invalidity of Australian military court; Validity of power to make ‘suppression orders’ upheld; NSW criminal organisations control law invalid; Provisions closing the federal electoral roll early invalid; Judicial review of offshore processing regime; Declaratory relief and ‘matter’ under the Native Title Act 1993

Australia’s Constitution (Pocket edition), revised foreword and updated notes by AGS, jointly published by AGS and the Parliamentary Education Office, March 2012

AGIMO Better Practice Guide: Negotiating the cloud – legal issues in cloud computing agreements, jointly published by AGS and the Australian Government Information Management Office, Department of Finance and Deregulation, November 2011

PODCASTS Transcripts are published to the website for accessibility reasons

Bianca Wellington, ‘New occupational health and safety duties for Commonwealth officers coming soon’, 23 September 2011

Chris Behrens, ‘Managing problem government contracts’, 4 November 2011

Grant Follett, ‘Careful contract drafting crucial to avoiding disputes’, 8 November 2011

Stuart Robertson, ‘New OHS risks in procurement if WHS laws passed’, 24 November 2011

Paul Barker, ‘Employer obligations for worker fatigue from 1 January’, 2 December 2011

Adrian Snooks, ‘Cloud guidelines for government’, 13 December 2011

Alex Readford, ‘Working as a graduate at AGS – what you can expect!’, 15 March 2012

Odette Adams, ‘Highlights of the AGS graduate program’, 19 March 2012


Abbreviations ACCC Australian Competition and Consumer Commission

ACLA Australian Corporate Lawyers Association

ADR alternative dispute resolution

AFP Australian Federal Police

AGD Commonwealth Attorney-General’s Department

AGIMO Australian Government Information Management Office

ANPHA Australian National Preventative Health Agency

ARENA Australian Renewable Energy Agency

ATO Australian Taxation Office

CAC Act Commonwealth Authorities and Companies Act 1997

CDDA compensation for detriment caused by defective administration

CSS Commonwealth Superannuation Scheme

DEEWR Commonwealth Department of Employment, Education and Workplace Relations

EBIT earnings before interest and tax

EBITDA earnings before interest, tax, depreciation and amortisation

FMA Act Financial Management and Accountability Act 1997

FMOs Finance Minister’s Orders

FOI freedom of information

FTE full-time equivalent

FWA Fair Work Australia

GLG Government Law Group

GST goods and services tax

HR human resources

HSC Health and Safety Committee

HWA Health Workforce Australia

IT information technology

LPP legal professional privilege

LSDs Legal Services Directions

LSMUL Legal Services Multi-Use List

NCSM National Client Service Manager

NPO National Practice Orientation

OGC AGS Office of General Counsel

PNG Papua New Guinea

>


PSS Public Sector Superannuation Scheme

WHS work health and safety

WHS Act Work Health and Safety Act 2011

WIP work in progress


Compliance index The index below shows compliance with information requirements contained in Section 9 and Schedule 1 of the Commonwealth Authorities and Companies Act 1997 (CAC Act) and the Commonwealth Authorities (Annual Reporting) Orders 2011.

Commonwealth Authorities (Annual Reporting) Orders 2011 (unless otherwise denoted)

Annual report page

Audited financial statements Schedule 1 of the CAC Act

63–96

Board performance review Clause 14 64–5

Committees Clause 14 46–7

Community service obligations Clause 20 44–53

Dividends Clause 20 19

Directors’ particulars Clause 13 47

Enabling legislation Clause 10 44–5

Environmental performance and environmentally sustainable development

Clause 12 52–3

Ethics framework Clause 14 8

Financial conditions Clause 20 17–19

Freedom of information Clause 12 49

Functions and powers Clause 10 44–5

General government policies notified by the Minister Clause 12 45

Indemnities and insurance premiums for officers Clause 19 49

Information about subsidiaries Clause 18 Not applicable – AGS does not have any subsidiaries

Judicial decisions and decisions of administrative tribunals Clause 17 45

Key activities and changes Clause 16 3, 17, 18

Letter of transmittal (approval by CEO) Clause 6 1

Location of major activities and facilities Clause 14 ii

Ministerial directions Clause 12 45

Objectives Clause 10 8

Operational and financial results Clause 16 17–19

Organisational structure Clause 14 48

>


Commonwealth Authorities (Annual Reporting) Orders 2011 (unless otherwise denoted)

Annual report page

Related entity transactions Clause 15 Not applicable – AGS has a sole director

Reports made by the Auditor-General, Parliamentary committee, Commonwealth Ombudsman or Office of the Australian Information Commissioner

Clause 17 45

Responsible Minister Clause 11 45

Risk management Clause 14 48

Significant events under s 15 of the CAC Act Clause 16 45

Statement on governance practices Clause 14 44–9

Workplace Health and Safety Clause 12 35–6


AAboriginal Australians, see Indigenous AustraliansACCC, see Australian Competition and Consumer Commissionaccidents and incidents, 36accommodation, 36, 37accountability and management, 44–9ACT Pro Bono Clearing House, 54advertising and market research, 49Advisory Board, 46AGS Alumni, 35, 41AGS Commercial, 7, 29AGS Dispute Resolution, 7, 29, 50–1air cargo price fixing litigation, 31alternative dispute resolution (ADR), 7, 29–30, 55Arts Law Centre of Australia, 54, 55Association of Dispute Resolvers (LEADR), 29ATO, see Australian Taxation OfficeAttorney-General, 6, 7, 20–1, 59 interventions in cases raising constitutional issues, 13 support as First Law Officer, 12–14, 23Attorney-General’s Department (AGD), 11, 14, 21, 37–8Audit Committee, 49Auditor-General reports, 45Australia Day Awards, AGS, 60–1Australian Competition and Consumer Commission (ACCC), 20, 29, 31, 60Australian Education Union, 13Australian Federal Police (AFP), 9, 14Australian Government Information Management Office (AGIMO), 58Australian Government policy notifications, 45Australian Government Protective Security Manual, 45Australian Lawyers Weekly Pro Bono Award, 55Australian National Audit Office, 46, 68–9Auditor-General reports, 45Australian National Preventive Health Agency, 10Australian National Registry of Emissions Units, 22Australian Renewable Energy Agency, 14Australian Security and Intelligence Organisation, 14Australian Taxation Office (ATO), 9, 29, 30awards and recognition, 20, 31, 51, 55

BBennett, David QC, 12, 20–1Betfair litigation, 13biosecurity legislation, 15business development, 24–5business improvement, 18, 25–7, 28–30business processes, 13–14

CCAC Act, see Commonwealth Authorities and Companies Act 1997*carbon farming initiative, 22*Carbon Pollution Reduction Scheme, 26carbon pricing, 22*carbon tax, 26 charities and not-for-profit organisations, 14, 54–5Chief Executive Officer (director), 20, 25, 46, 47, 66 communication with client CEOs and secretaries, 25–6 corporate services review, 3, 36 indemnity, 49 legal practice restructure, 3, 28 legislation governing, 45 review, 3Chief Financial Officer, 66cigarettes, plain packaging of, 14, 20–1classification of staff, 33–5clean energy, 10–11, 22client base 6, 12–14, 18, 24–5Client Care Awards, 27client satisfaction, 24, 27, 28client service delivery, 24–5client survey, 25cloud-computing arrangements, 58–9Coal Sector Jobs Package Program, 11

Code of Conduct, 8commercial disputes, 7, 50–1committees, 48–9Commonwealth Authorities and Companies Act 1997 (CAC Act), 6, 40, 44–5Legal Network, 24–5, 40Commonwealth Water Act 2007, 26communications, see media and communicationscommunity legal services, 54–5community service obligations, 49, 52compensation claims, 36

> Index


Competition and Consumer Act 2010, 20competitive neutrality payments, 19conferences, see training courses, conferences and other forumsConstitutional Litigation Unit, 7, 12–13, 20–1, 28–9constitutional matters, 7, 12–13, 15, 20–1 ‘pocket Constitution’, 100construction, 45contracts, see procurementConvention on Biological Diversity, 15corporate governance, 44–9corporate governance committees, 48corporate intent statement, 46corporate objectives and strategies, 17–27 emphasised in mandate, 8corporate plan, 17, 23, 56–7Corporations (Aboriginal and Torres Strait Islanders) Act 2006, 54Credit and Debt Legal Service, 54cybercrime, 58

DDarwin Community Legal Service, 54defence, see national security and defenceDepartment of Climate Change and Energy Efficiency, 11, 22Department of Employment, Education and Workplace Relations (DEEWR), 50–1Department of Finance and Deregulation (Finance), 24–5Department of Foreign Affairs and Trade, 21Department of Health and Ageing, 10, 20–1Department of Human Services, 11Department of Resources, Energy and Tourism, 11Department of Sustainability, Environment, Water,Population, Arts and the Community, 11 director, 47 see also Chief Executive OfficerDisasterwatch app, 58dispute resolution, 7, 50–1dividends paid, 19

Eefficiency dividend, 18email bulletins, 25, 26, 98 emerging business opportunities, 17–18Employee Council, 48employees, see staffemployee survey, 35Employment Law Centre of WA, 54

employment law, 14, 25, 35, 39 forum, 98energy and resources, 10–11, 22, 26Energy Security Fund Cash Payments program, 11enterprise agreement, 35environment AGS performance, 52-3 environmental policy, 53 Environment Protection and Biodiversity Conservation Act 1999, 52establishing legislation, 6, 44-5ethics and values, 8Ethics Committee, AGS, 48 events, 25, 26Executive Management Committee, 48–9Express Extra email bulletin, 25Express Law newsletters, 25, 26, 98external corporate governance, 47

Ffact sheets, 25, 99–100Fair Work Australia (FWA), 50–1Family Court, 13Federal Court, 13Federal Magistrates Court, 13female employees, 34finance and financial services agency spending trends, 17–18 Credit and Debt Legal Service, 54 indemnities and insurance premiums for officers, 49 performance measures, 18–19 pro bono legal work, value of, 54 tied work revenue, 12 see also procurementFinancial Management and Accountability Act 1997 (FMA Act) agencies, see government business enterprise operationsFinancial Services team, 36financial statements, 63–96First Law Officer support, 12–14, 23forums, see training courses, conferences and other forumsFred Hollows Foundation, 55freedom of information, 40, 49full-time equivalent employees, 33funding agreement, 10funding programs, 10–11, 14future directions, 56–7


Ggambling, 14gender of employees, 34General Counsel, see Office of General Counselgovernance, 43–9Gov 2.0, 24, 58–9government business enterprise operations, 6, 17–19 business development, 24–5 legal practice restructure, 28, 36–7 market trends, 17–18 see also performance measuresGovernment Law Group (GLG) meetings, 27Government Lawyer of the Year Awards, 31government loan, repayment of, 19government policy notifications, 45Govey, Ian, 3, 25, 47, 59graduate recruitment, 32

HHealth and Safety Committee (HSC), 35Health Workforce Australia, 10High Court cases, 13, 20–1Howe, Tom QC, 29, 50–1human resources, see staff

Iin-house legal services, 24, 26 see also training courses, conferences and other forumsincidents and accidents, 36income, see finance and financial services income tax, 19, 67 charged to profits, 19 Income Tax Assessment Act 1936indemnities, 49Indigenous Australians commitment to reconciliation, 53 community legal centres and pro bono clearing houses, 54–5 legal aid program, 11information and communications technology, 37, 58–9 client service products and information, 25–7, 98–100 Gov 2.0 (Web 2.0) implementation, 24, 58–9 podcasts, 26, 59, 100 see also media and communicationsInspector-General of Biosecurity Bill, 15insurance premiums, 49interest receipts, 19interim dividend paid, 19internal corporate governance, 47-9

international pro bono work, 55internet, see information and communications technologyintranet, 37IT projects, 37investment treaty arbitration, 21JJT International, 13judicial decisions impacting on operations, 45Judiciary Act 1903, 6, 44, 52 ministerial directions under, 45 s 78B notices and s 78A interventions, 13JusticeNet SA, 54

KKeeping in touch, 35

LLaw Council of Australia, 30LawHelp, 54LEADR, 29learning and development, see training courses, conferences and other forumsleasing, see property and leasingLegal Opinions database, 37Legal Services Directions, 12, 14, 29legal services expenditure, 17-18Legal Services Multi-Use List (LSMUL), 18, 25legal training, see training courses, conferences and other forumslegislation, 6, 44–5 see also Judiciary Act 1903; litigationlibrary services, 37, 61litigation, 12–13 alternative dispute resolutionloan repayment, 19Local Solutions Fund, 11

MMagistrates Court, 13management and accountability, 43–9management committees, 48–9Managing disputes in federal government agenciesmandate, 8, 17maritime reform, 26market, see government business enterprise operationsmarket research and advertising, 49media and communications forum see also information and communications

technology; publications; training courses, conferences and other forums


meetings Advisory Board, 46 Government Law Group (GLG), 27membership Advisory Board, 46 Audit Committee, 46 Executive Management Committee, 48–9military justice reform, 14minerals resource rent tax, 15ministerial directions, 45Ministers, 6 see also Attorney-Generalmodel litigant obligation, 12Murray–Darling Basin Plan, 14

NNational Alternative Dispute Resolution Advisory Council, 29National Archives of Australia, 37National Broadband Network, 14National Client Service Managers (NCSMs), 24, 25National Code of Practice for the Construction Industry, 45National Energy Market Reform, 26national practice groups, AGS, 6–7, 28National School Chaplaincy Program, 13national security and defence, 14Navigation Act 1912, 26net interest receipts, 19new business opportunities, 24–5newsletters, 25, 26, 98–100non-contestable (tied) work, 12North Australian Aboriginal Justice Agency, 54–5Northern Territory intervention legislation, 14not-for-profit organisations, legal work for, 52, 54–5NSW Court of Appeal, 13

Oobjectives and strategies, 17–27 emphasised in mandate, 8occupational health and safety, 35–6, 39Office of General Counsel (OGC), 7, 20–1 legal practice restructure, 28, 36–7Office of Legal Services Coordination (OLSC), 17Office of Parliamentary Counsel, 15Office of the Registrar of Indigenous Corporations (ORIC), 54office productivity upgrade project, 37operating profits, 3, 17, 19organisational changes, 28, 36–7

organisation and structure, 48 Constitutional Litigation Unit, 13 legal practice restructure, 28, 36–7organisation charts external corporate governance, 47 legal services delivery, 48Orr, Robert QC, 14, 22outpost practice, 26

PPapua New Guinea, 55part-time employees,33performance measures, 18–19 business process strength, 19 client satisfaction, 19 employee engagement with business, 19 financial outcomes, 19 legal service capability, 19, 29Personal Property Securities Act 2009, 55PILCH, see Public Interest Law Clearing Houseplain packaging, 14, 20–1plans and planning, 56–7 reconciliation action, 53 risk management, 48 workplace health and safety, 35–6‘pocket Constitution’, 100podcasts, 26, 59, 100policy notifications, 45portfolio membership, 6pricing project, 25privacy, 59pro bono legal work, 52, 54–5procurement, 18 advertising and marketing research, 49professional development, 32professional indemnity insurance, 49professional standards, 8profitability, 3, 17, 19Project Wickenby, 9Public Interest Law Clearing House, 54publications and communication products, 25, 26, 98–100purchasing, see procurement

QQantas dispute, 14, 50–1Quarantine Act 1908, 15


Rreconciliation, 53recruitment, 32, 34Regional Assistance Mission to Solomon Islands, 55Remuneration Committee, 48Remuneration Tribunal, 47reporting to AGD, 6, 47 to shareholder ministers, 45–6, 47responsible minister, see Attorney-Generalretention of employees, 34revenue, see finance and financial servicesreview of government legal services procurement, 18risk management, 48–9

Ssatisfaction, see client satisfactionseminars, see training courses, conferences and other forumsSenior Executive Lawyers, 33–4service period of employees, 34sex of employees, 34shareholder Ministers, 6, 45 see also Attorney-Generalsignificant events, 45social media, 58social responsibility, 49, 52, 54–5Solicitor-General, 7, 13, 20–1staff, 33–5 engagement with business, 19, 35 indemnities and insurance premiums, 49 outposted lawyers, 26 survey, 35staff learning and development, 32statement of corporate intent, 46strategies and objectives, 17–27 emphasised in mandate, 8Strategy and Operations Advisory Group, 48StreetLaw, 54Suburban Jobs Program, 11succession planning, 25, 32survey of clients, 25

Ttaxation, 19, 67 constitutional matters, 9 income tax charged to profits, 19telecommunications industry, 31tenders, see procurementtied work, 12Tobacco Plain Packaging Act 2011, 20tobacco products, plain packaging of, 14, 20–1training courses, conferences and other forums, 26, 27, 29, 98 alternative dispute resolution, 30 community legal centre lawyers and volunteers, 55 Gov 2.0 implementation, 58–9 National Client Service Managers (NCSMs), 25 Pacific region, 55 for staff, 32

Vvalues and ethics, 8Victorian Court of Appeal, 13vision statement, 8vocational education and training, 27, 32, 98 see also training courses, conferences and

other forums

WWalk for Justice, 55website, 25Welfare Rights ACT, 55Western Australian Court of Appeal, 13wheat export marketing legislation, 14whole-of-government matters, 10Williams decision, 13women employees, 34workers compensation claims, 36workforce, see staffWork Health and Safety Act 2011, 14, 25, 35, 39workplace health and safety, 35–6, 39workshops, see training courses, conferences and other forums

Documents

annual report 2011 – 12 › aboutus › documents › AGS... · Wickenby, gambling reforms, carbon price and clean energy initiatives, the minerals resource rent tax, health reforms,