2021-07-15 Ordinary Meeting Agenda

ORDINARY MEETING AGENDA                                                                                                                                          15 JULY 2021


 Category                                                                                                                                  Comments
 Net Financial Liabilities Ratio                                                                                                              Intent: Outlines the level that net
                                                                                                                                               Council debt can be serviced by
                70%
                                                         60%                                                                                   operating revenues. A ratio below
                60%
                                                                                                                                               zero implies that liabilities are
                50%                                                                                                                            less than cash (and other current
                40%                                                                                                                            assets) and there is adequate
                30%                                                                                                                            borrowing capacity available if
                20%
                                                                                                                                               needed.
                10%                                                                                                                           Target: less than 60%
                                     0%                                                                                                       Result: - 27%
   -10%
                                                      Target                            Budget                       YTD Actual
                                                                                                                                              Comment: Council has low debt
   -20%                                                                                                                                        levels and sufficient cash
                                                                                        -15%                                                   holdings which are reflected in
   -30%
                                                                                                                       -27%                    the annual result.
   -40%


 Investment Return                                                                                                                            Intent: Ensure appropriate return
                                                                                                                                               on investment yield for cash at
                                                                                                                                               bank.
                                                                                                                                              Target: 0.25% above current
                                                                                                                                               Bloomberg commonwealth 10
                                                                                                                                               year bond rate yield (0.02%)
                                                                                                                                              Result: 0.37%
                                                                                                                                              Comment: Regardless of the
                                                                                                                                               current levels of low long term
                                                                                                                                               bond and interest rates (due to
                                                                                                                                               current economic conditions),
                                                                                                                                               Council’s investment return still
                                                                                                                                               remains above target.
 Rates in Arrears                                                                                                                             Intent: Ensuring that the amount
                                                                                                                                               of    unpaid    rates    remains
                                           12.0%
   Percentage of Annual Rates in Arrears




                                                                                                                                               sustainable and does not
                                                                 9.6%                                         9.5%                             negatively impact cash flows.
                                           10.0%
                                                                                                                                              Target: 5% industry benchmark
                                            8.0%                        7.1%                                          7.4%
                                                                                                                             6.2%             Result: 5.7%
                                                   5.8%                        6.0% 5.8% 5.7%                                       5.7%
                                            6.0%                                                       5.0%                                   Comment: Rates arrears are in
                                                          4.5%
                                                                                                                                               line with performance for the
                                            4.0%
                                                                                                                                               previous 6 and 12 monthly cycles.
                                            2.0%

                                            0.0%
                                                   Jul    Aug    Sep    Oct     Nov      Dec     Jan   Feb    Mar     Apr    May    Jun

                                                                               Actual             Target




Previous Council Consideration
Nil.

Finance
As above.

Risks & Opportunities
Council’s risk register includes a number of risks that could impact on ongoing financial sustainability.
Effective budget management and reporting is an important risk mitigation tool.

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