National Water Account 2015

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Region overview

Contextual information

Physical information

Administration

Water rights

Climate and water overview

Water Accounting Statements

Water Assets and Water Liabilities

Changes in Water Assets and Water Liabilities

Water Flows

Notes

Accounting policies

Supporting information

Quantification approach

Reconciliations

Water resources & systems

Water access & use

Future outlook

References

Accountability statement

Melbourne: Water accounting policies

Introduction

The information presented in the Melbourne region water accounting report is based on collaboration between the Bureau of Meteorology and:

• Victorian Department of Environment, Land, Water and Planning (previously the Department of Environment and Primary Industries before 1 January 2015)
• Melbourne Water
• City West Water
• South East Water
• Yarra Valley Water
• Western Water
• Southern Rural Water.

This report has been prepared using an accrual basis of water accounting, with the exception of the physical water flow information. The water attribute being quantified is volume and the unit of account is megalitres (ML). Where a reported volume is negative, it is shown in brackets. The applicable reporting period is from 1 July 2014 to 30 June 2015.

Recognition of water assets and water liabilities

Only water that is held or managed by the State licensing authority or the urban retail water authorities and from which future benefit can be derived by stakeholders of the region is defined as a water asset.

Water liabilities are constituted by present commitments to supply water, the discharge of which is expected to result in a probable decrease of the region's water assets or a probable increase in another commitment to supply water.

Provided its volume can be quantified in a way that is complete, neutral, and free from material error, the volume of the water asset or water liability is recognised in the Statement of Water Assets and Water Liabilities.

Water held in storages that has already been abstracted from the entitlement system is deemed not to be part of the region (regardless of the storage's size or connection to the system). This is because the attendant water right has already been exercised.

Recognition of changes in water assets and water liabilities

The increases and decreases to the reported water assets and water liabilities consist of changes that can be quantified in a way that is complete, neutral, and free from material error. These volumes are presented in the Statement of Changes in Water Assets and Water Liabilities and the Statement of Water Flows.

Precipitation and evaporation are recognised only in relation to the surfaces of open storage volumes. They do not represent all precipitation, evaporation, and evapotranspiration within the region (notably, these processes occurring from the landscape are not captured).

The portion of runoff that flows into the surface water store (storages and river channels) is quantified and recognised in the Statement of Changes in Water Assets and Water Liabilities. This runoff includes precipitation captured in the catchment less evaporation and infiltration, and is recorded as Runoff to surface water.

Allocation announcements on regulated entitlements have been recognised as increases in water liabilities. Note that the definition of regulated or unregulated entitlements for the purpose of the National Water Account (refer to Glossary) may be different to the meaning applied by the jurisdiction. Please refer to the Water rights, entitlements, allocations and restrictions note for more information on the allocations.

Water assets and water liabilities that fail the recognition criteria

The volumes of some water assets in the Melbourne region were not reported in the water accounting statements but replaced by dashes ('–') as they 'failed the recognition criteria' specified in the Australian Water Accounting Standard 1, because:

• they could not be quantified in a way that is complete, neutral and free from material error, and/or
• they were unlikely to provide a future benefit to the region or the region's stakeholders.

Water assets that failed the recognition criteria include unregulated and regulated rivers (see Surface water store note), the urban water supply system, and the recycled water system (see Urban water system note).

Changes to water assets and water liabilities that fail the recognition criteria

The volumes of several changes to water assets identified in the Melbourne region were not reported in the water accounting statements but replaced by dashes ('–') as they 'failed the recognition criteria' specified in the Australian Water Accounting Standard 1, because:

• they could not be quantified in a way that is complete, neutral, and free from material error, and/or
• they were unlikely to provide a future benefit to the region or the region's stakeholders.

The volumes that failed the recognition criteria include:

• discharge: user to surface water; discharge: groundwater to surface water; surface water diversion: statutory rights; and recharge: surface water to groundwater (see Surface water store note)
• groundwater extraction: statutory rights; and non-allocated extraction: individual users (see Groundwater store note).

Restatement of comparative information

In accordance with the Australian Water Accounting Standard 1, comparative year volumes must be restated in the statements if there is a prior period error or a change in item presentation. Comparative year volumes are not required to be restated if there is a change in scope or methodology or subsequent data availability for the quantification of an item. The between-store flows and transfers relating to restatement of comparative information, which are eliminated from the region's water accounting statements, are shown in italics below.

The following comparative year volumes in the water accounting statements were restated from the 2014 Account due to prior period errors:

• Urban claims: surface water / Allocation remaining: urban system
• Adjustment and forfeiture: urban system / Decrease in urban claims: surface water

These two restatements have been made to include carryover volume for Western Water from the Melbourne headworks system as applicable on 30 June 2014. This volume, 13,613 ML, was not included in the 2014 Account due to a data translation error.

The following comparative year volumes in the water accounting statements were restated from the 2014 Account due to changes in presentation:

• Discharge: urban system / Urban supply system discharge: surface water
• Discharge: wastewater / Wastewater discharge: surface water
• Supply system delivery: urban users
• Recycled water discharge: irrigation
• Other supply system decreases
• Recycled water delivery: urban users
• Other wastewater decreases
• Supply system delivery: irrigation

These changes separated water flows to and from the urban water supply system from flows to and from the wastewater and recycled water systems, providing clearer information to users of the National Water Account.

The changes associated with prior period errors and changes in presentation are summarised in Table N1.

Transactions within the region

Transactions between water assets and water liabilities within the region (e.g., between the surface water store and the groundwater store) are not reported in the water accounting statements because they do not affect the region's total water assets and water liabilities.

This information is reported in the Water resources and systems note which includes water accounting statements for each water store. These contain internal transactions that were excluded from the consolidated water accounting statements. This ensures that transactions between water assets and water liabilities within the region are still reported.