Forecast and actual expenditure

2.25 Accurately forecasting expenditure is an important element in the effective management of a portfolio of projects and understandably receives close attention within the Defence Organisation and by key stakeholders. Figure 7 sets out the expenditure forecasting performance of each project against the actual expenditure for the 2010-11 financial year. In total, the actual expenditure for the 28 projects at 30 June 2011 was $3.7 billion, against an initial forecast expenditure of $5.0 billion and half-year revised forecast of $4.0 billion. The main factors contributing to the variance were production/schedule delays, lower than anticipated FMS disbursements, the transfer of funding of activities to sustainment, and foreign exchange fluctuations.

Figure 7
In-year (2010-11) projects' forecast expenditure performance compared to actual expenditure (variance percentage)