Reserve Bank of Australia Annual Report – 2015 Financial Statements Note 10 – Other Liabilities

2015 $M 2014 $M
Provisions 1(h)    
Provision for accrued annual leave   17 17
Provision for long service leave   39 40
Provision for post-employment benefits   92 101
Other   1
  149 158
Securities sold under agreements to repurchase 1(b) 1,780 5,244
Payable for unsettled purchases of securities   1,556 1,693
Interest accrued on deposits   59 65
Superannuation liability 1(i), 14 64 197
Other   968 231
  4,427 7,430
Total Other Liabilities as at 30 June   4,576 7,588

The provision for workers compensation at 30 June 2015 was $416,000 ($237,000 at 30 June 2014).

During 2014/15, annual leave of $11.9 million was accrued by staff, while $11.5 million of accrued leave was used. Staff accrued and used long service leave of $4.1 million and $2.8 million respectively in 2014/15.

The RBA's provision for its post-employment benefits was $9.0 million lower in 2014/15, largely due to an increase in the discount rate. Benefits of $4.3 million were paid out of the provision for post-employment benefits in 2014/15. The balance of the provision for post-employment benefits will change if assumptions about the length of staff service, the longevity of retired staff, future movements in medical costs or the discount rate vary.

At 30 June 2015, $12.1 million of the provision for accrued annual leave was expected to be taken within 12 months ($11.4 million at 30 June 2014); $4.1 million of the provision for long service leave was expected to be taken within 12 months ($4.2 million at 30 June 2014); and $4.5 million of the provision for post-employment benefits was expected to be paid out within 12 months ($4.5 million at 30 June 2014).

The RBA's provisions for annual leave, long service leave and post-employment benefits at 30 June 2015 have been calculated by applying the yield on high-quality Australian dollar-denominated corporate bonds to discount the estimated future liabilities to their present value. The yield on Australian government bonds was applied in 2013/14. This change in discount rate is in accordance with AASB 119, which requires the use of corporate bond yields if the disclosing entity judges this market to be sufficiently deep. Consistent with practice of other corporate reporting entities, the Bank has concluded for disclosure purposes that this market is sufficiently deep to provide a reliable discount rate for future cash flows. As the yield on corporate bonds is higher than that on Australian government bonds of equivalent maturity, this change has reduced the value of the RBA's provisions, resulting in a reduction of $24.7 million in the expense charged to profit.