2 Does revenue for service contracts materially with what has been advised by the Ministry? All non-devolved revenue sourced from the Ministry will be confirmed directly with the responsible Ministry directorates. 3 Out-year revenue assumptions consistent with Ministry advice? Indicative out-year revenue increases are advised in the latest Funding Envelope. 4. Cost and Volume Assumptions Requirements Interpretation 1 Are the assumptions for personnel outsourced services costs and Full Time Equivalent (FTE) movements appropriate and adequately explained? Assessment of whether cost assumptions are ‘appropriate’ and ‘adequately explained’ will be based on whether cost changes are consistent with: financial information disclosed in the AP and AP financial templates estimated revenue growth advised in the latest Funding Envelope the percentage ranges estimated in CPI and salary indices changes in volumes, practices, service delivery, etc. Significant variation from the latest Funding Envelope or indices should be explained and justified in the AP, or in a confidential document sent separately to the Ministry. Expenditure planned for out years should reflect a realistic assessment of requirements to support the projected revenue stream in those years. It should not be derived simply by applying the same preliminary increase as for revenues to each expenditure line. 2 Are planned interest, depreciation, capital charge costs and assumptions appropriate and adequately explained? 3 Are all other cost assumptions (eg, clinical supplies costs) appropriate and adequately explained? 4 Is the productivity gain and associated risk inherent in the plan clearly explained? 5. Fixed Assets Requirements Interpretation 1 Does the AP include a statement about: a) when assets were last revalued b) in what year the next revaluation will take place as required by relevant accounting standards. No interpretation required. 2 Does the AP include (if known) the asset impacts and additional costs resulting from re-evaluation? No interpretation required. 3 Does the DHB note its strategy for actively disposing of assets that are surplus to requirements? No interpretation required.
4 Does the AP include a statement about the procedure for disposing of any land transferred to, or vested in the DHB under the ? requires the inclusion of a statement about a DHB’s procedure for disposing of land transferred to or vested to it under the , irrespective of whether land disposals are planned. 6. Capital Expenditure Requirements Interpretation 1 Is the capital expenditure section of the AP consistent with the DHB’s management plan and the relevant RSP? No interpretation required. 2 Does the capital expenditure section of the AP narrative reflect major capital projects, clearly distinguishing between approved and unapproved projects and whether they are baseline or strategic? An ‘approved’ capital project means that the DHB has a letter from the Minister of Health approving that capital project. 3 Are sources of planned capital financing for both baseline and strategic capital expenditure clearly identified? Sources of planned financing may include: DHB contribution New Crown debt (approved/unapproved) Crown equity (approved/unapproved) Finance leases Community donations/funding. 4 Is capital expenditure and financing correctly reflected in all sections of the AP financial template including the cash flow statement? The AP financial template should reflect only approved capital expenditure (even if included in baseline capital expenditure) and financing. The only exception is for the capital plan worksheet, which should also include unapproved capital projects and anticipated sources of funding. 7. Debt and Equity Requirement Interpretation 1 Does the AP include a schedule of key lenders, borrowing arrangements (including rates and limits) that distinguish between new and existing borrowing facilities? The schedule of key lenders should working capital, and long-term borrowing and finance leases. 2 Does the AP show the related banking covenants, and is the DHB planning to meet them? No interpretation required. Output Class Recommendations (NOT included in final plans – reference only) Output Class Definitions It is expected that all DHBs will use the following output class definitions: Prevention Preventative services are publicly funded services that protect and promote health in the whole population or identifiable sub-populations comprising of services designed to enhance the