2014-07-28 General Committee Agenda

GENERAL COMMITTEE MEETING AGENDA                                                            28 JULY 2014


2                         BANKING AND INVESTMENT ARRANGEMENTS
DOCUMENT IN FOR MATI ON




Author                           Manager Financial Services, Wayne Jensen
                                 Corporate Services Department

Index                            ECM / Subject / 22 - Financial Accounting and Management

Attachments                      Nil


EXECUTIVE SUMMARY
The Planning and Organisation Committee requested a report on the current Council banking
and investment arrangements.

RECOMMENDATION
That Council note the report by the Manager Financial Services to the General Committee
Meeting dated 28 July 2014 regarding Noosa Council’s banking and investment arrangements.


REPORT
Council currently has transactional banking arranged through the Commonwealth Bank of
Australia (CBA), with investment accounts also arranged through Queensland Treasury
Corporation (QTC).

The CBA facilities were arranged as an extension of facilities that exist for Sunshine Coast
Council for an initial period of 12 months to December 2014 with two x 1 year options for
extension. It should be noted that to undertake a full banking services tender is time consuming
and costly, and as such Council obtained Ministerial approval for the arrangements as a means
of ensuring facilities would exist for the commencement of business on 1 January 2014.

The range of banking services are relatively complex, and involves 2 primary bank accounts for
general consolidated funds plus a trust account; interest bearing accounts also provide short
term cash management opportunities. Council maintains a range of merchant EFTPOS facilities
across all venues and facilities, plus online payment interfaces; corporate purchase cards; and
interfaces with external service providers.

To this point investment of surplus funds has been constrained by the timing of the finalisation of
the transfer of cash from Sunshine Coast Council, including uncertainty around the level of
surplus cash that might be available for longer term investment. QTC provide a capital
guaranteed cash management account and this has been utilised along with the interest bearing
account at CBA for investment of surplus funds for the last six months.

Council’s investment policy allows for investment of funds in accordance with a number of
legislative heads of power including the Local Government Act 2009 and Statutory Bodies
Financial Arrangements Act 1982 (SBFA). Council has been granted Category 1 investment
power under the SBFA which allows for authorised investment with QTC or the Queensland
Investment Corporation (both state government entities), along with appropriately rated financial
institutions. The policy also identifies the need to ensure Council’s capital is preserved (i.e. no
loss on any investment occurs), whilst ensuring that maximum opportunity is realised from any
surplus funds available. Council’s budget includes interest revenue from investments which is
taken into consideration annually when considering overall revenue requirements to fund costs.


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