While waiting for a QF flight at MEL domestic yesterday, I heard announcements from an adjacent gate where there was apparently some issue with the aircraft; the waiting pax were advised of delays periodically while the issue was assessed. Eventually it was announced that the flight was cancelled. A bit of an explanation of the issue was given and ended with " ... so the Captain and First Officer have decided that the flight would (or should) be cancelled."
This last bit surprised me, as I would have thought the ultimate decision to cancel a flight (rather than flying another aircraft) would be decided by 'operations' and I guessed that the announcer was just using a bit of verbal shorthand.
In domestic and/or international ops, what are the 'mechanics' of deciding an aircraft is unserviceable (ie Engineer just reports 'its u/s' and that's it, or he/she reports an opinion to Captain and he/she decides; maybe the engineer's report is checked against a standard list of 'go/no-go' issues and that decidedes etc).
If a particular aircraft is unserviceable, what are then the mechanics for deciding that the flight would be outright cancelled, or flown with a substitute aircraft, later on? Do the Captain and FO have any say?