Reserve Bank of Australia Annual Report – 2021 Financial Statements Note 3 – Distribution Payable to the Commonwealth

Net profits of the RBA, less amounts transferred to the RBRF, are paid to the Commonwealth as required by section 30 of the Reserve Bank Act (see Note 1(h)). Also under section 30, unrealised profits from foreign exchange, foreign securities and Australian dollar securities are not available for distribution. Instead they are transferred to the unrealised profits reserve where they remain available to absorb future valuation losses or are realised when relevant assets are sold or mature. Unrealised losses are, in the first instance, absorbed within the unrealised profits reserve where they are offset against unrealised profits accumulated from previous years. For purposes of distribution, if such losses exceed the balance of the unrealised profits reserve, the amount by which they do so is initially charged against other components of net profit, and any remaining loss is absorbed by the RBRF.

In 2020/21, the RBA recorded a net accounting loss of $4,332 million. Unrealised losses of $8,249 million were absorbed within the unrealised profits reserve. A gain of $1 million was transferred from the Asset revaluation reserve to the Statement of Distribution. Earnings available for distribution therefore amounted to $3,918 million in 2020/21.

The Treasurer, after consulting the Board, determined that a sum of $1,247 million was to be placed from earnings to the credit of the RBRF. Accordingly, a sum of $2,671 million is payable as a dividend to the Commonwealth. This sum will be paid to the Commonwealth in September 2021. An amount of $2,567 million was paid to the Commonwealth in 2020/21.

Opening balance 2,567 1,685
Distribution to the Commonwealth (2,567) (1,685)
Transfer from Statement of Distribution 2,671 2,567
As at 30 June 2,671 2,567