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Noosa Council Annual Report 24/25
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Noosa Council Noosa Council
Notes to the Financial Statements Notes to the Financial Statements
for the year ended 30 June 2025 for the year ended 30 June 2025
Note 29. Financial Instruments and Financial Risk Management (continued) Note 29. Financial Instruments and Financial Risk Management (continued)
§Note/Subtotal§
Total
investments are required to have a minimum credit rating of "A-", therefore the likelihood of the counterparty having capacity 0 to 1 1 to 5 Over 5 contractual Carrying
to meet its financial commitments is strong.
$ '000 year years years cash flows amount
Other investments are held with financial institutions, which are rated AAA to AA- based on rating agency Standard and 2024
Poor's ratings, and whilst not capital guaranteed, the likelihood of a credit failure is assessed as remote (if applicable).
Payables 24,824 – – 24,824 24,824
In the case of rate receivables, the Council has the power to sell the property to recover any defaulted amounts. In effect this Loans - QTC 1,882 7,626 21,861 31,369 24,855
power protects the Council against credit risk in the case of defaults. 26,706 7,626 21,861 56,193 49,679
In other cases, the Council assesses the credit risk before providing goods or services and applies normal business credit
protection procedures to minimise the risk. The outflows in the above table are not expected to occur significantly earlier and are not expected to be for significantly
different amounts than indicated in the table.
By the nature of the Councils operations, there is a geographical concentration of risk in the Council's area.
Market Risk
§Subnote§
The Council does not require collateral in respect of trade and other receivables. The Council does not have trade receivables
for which no loss allowance is recognised because of collateral. Market risk is the risk that changes in market indices, such as interest rates, will affect the Council's income or the value of
its holdings of financial instruments.
At 30 June, the exposure to credit risk for trade receivables by type of counterparty was as follows:
Interest rate risk
§Subnote§
$ '000 2025 2024 Noosa Shire Council is exposed to interest rate risk through investments and borrowings with Queensland Treasury and other
financial institutions.
Noosa Council Annual Report 24/25
Property Charges 7,246 5,497
Fees and Charges 4,780 7,212 It also has access to a mix of variable and fixed rate funding options through QTC so that interest rate risk exposure can
GST Recoverable 835 1,736 be minimised.
Associates 49,218 49,218
Sensitivity
Other 1,322 76 Sensitivity to interest rate movements is shown for variable financial assets and liabilities based on the carrying amount at
Total 63,401 63,739 reporting date.
The following interest rate sensitivity analysis depicts what effect a reasonably possible change in interest rates (assumed to
Liquidity Risk
§Subnote§
be 1%) would have on the profit and equity, based on the carrying values at the end of the reporting period. The calculation
assumes that the change in interest rates would be held constant over the period.
Liquidity risk refers to the situation where the Council may encounter difficulty in meeting obligations associated with financial
liabilities that are settled by delivering cash or another financial asset. Noosa Shire Council is exposed to liquidity risk through
its trading in the normal course of business and borrowings from the Queensland Treasury Corporation for capital works. Net Carrying Net Result Equity
$ '000 Amount 1% increase 1% decrease 1% increase 1% decrease
The Council's approach to managing liquidity is to ensure, as far as possible, that it will have sufficient liquidity to meet its
liabilities when they are due, under both normal and stressed conditions, without incurring unacceptable losses or risking 2025
damage to the Council's reputation. QTC cash fund 75,108 751 (751) 751 (751)
Other investments 33,854 338 (338) 338 (338)
Loans - QTC (23,684) – – – –
Exposure to Liquidity risk Net 85,278 1,089 (1,089) 1,089 (1,089)
Council is exposed to liquidity risk through its normal course of business and through its borrowings with QTC and other
financial institutions. 2024
QTC cash fund 71,001 710 (710) 710 (710)
The Council manages its exposure to liquidity risk by maintaining sufficient cash deposits and undrawn facilities, both short
Other investments 34,680 347 (347) 347 (347)
and long term, to cater for unexpected volatility in cash flows. These facilities are disclosed in Note 10.
Loans - QTC (24,855) – – – –
Net 80,826 1,057 (1,057) 1,057 (1,057)
The following facilities had been utilised at the end of the reporting period to manage liquidity risk:
§Subnote§
In relation to the QTC loans held by the Council, the following has been applied:
Total
0 to 1 1 to 5 Over 5 contractual Carrying QTC generic debt pool - the generic debt pool products approximate a fixed rate loan. There is a negligible impact on interest
$ '000 year years years cash flows amount sensitivity from changes in interest rates for generic debt pool borrowings.
Fair Value
§Subnote§
2025
Payables 16,653 – – 16,653 16,653
Loans - QTC The fair value of trade and other receivables and payables is assumed to approximate the value of the original transaction,
1,907 7,626 19,954 29,487 23,684
less any allowance for impairment.
18,560 7,626 19,954 46,140 40,337
continued on next page ... Page 42 of 62 continued on next page ... Page 43 of 62
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