[3rg0s4m]

The algorithm used is fairly complicated, being both preferential and proportional. (The lower house is preferential but not proportional).

Here is a nifty visualization of the senate vote flows in NSW: http://www.grwpub.info/senate/nsw.svg.

Essentially you need a certain number of votes to cross the line and win a seat. After winning the seat, those votes are subtracted from the party. Eventually when no parties have enough votes, the lowest voted party is eliminated and its votes are redistributed by preference.

[timv]

I once attempted to implement the Senate counting algorithm (mostly so I could force myself to truly understand it).

I can say with great confidence that it is hard to implement correctly, and it would take more than a single external audit to give me confidence that the AEC's implementation is flawless.

[nmrm]

What's up with the yellow lines going from already-excluded parties?

[makomk]

Apparently http://www.grwpub.info/senate/ is the description that goes with that animation. The yellow lines are votes for parties that were already eliminated getting redistributed again because the party their votes had gone to is being eliminated too.