Annual Report 2022-23

      Note 27. Reconciliation of net result for the year to net cash inflow/(outflow) from                                           Note 29. Financial instruments and financial risk management
               Operating Activities                                                                                                  §Subnote§




      §Subnote§

                                                                                                                                     Noosa Shire Council has exposure to the following risks arising from financial instruments; (i) credit risk, (ii) liquidity risk, and
           $ '000                                                                                           2023             2022    (iii) market risk.

           Net Operating Result from Income Statement                                                    16,763            17,960    This note provides information (both qualitative and quantitative) to assist statement users evaluate the significance of financial
                                                                                                                                     instruments on the Council's financial position and financial performance, including the nature and extent of risks and how the
                                                                                                                                     Council manages these exposures.
           Non-Cash Items
           Depreciation and Amortisation                                                                  19,964            17,929   Council has reviewed its exposure to financial risk as a result of the COVID-19 pandemic, and at present does not anticipate
           Non-Cash Capital Contributions                                                                  (451)             (699)   likelihood of increased financial risk through either the decline in credit rating of financial institutions or increased levels of
                                                                                                         19,513            17,230    default in receivables.

           Losses/(Gains) recognised on fair value re-measurements through the Income
           Statement                                                                                                                 Financial risk management
           Investment Properties                                                                           (700)             (400)
                                                                                                                                     Council is responsible for the establishment and oversight of the risk management framework, together with developing and
           Movement in Restoration Provisions                                                              8,799             8,016   monitoring risk management policies.
                                                                                                          8,099             7,616
                                                                                                                                     Council's management approves policies for overall risk management, as well as specifically for managing credit, liquidity and
           Investing and Development activities                                                                                      market risk.
           Loss on write-off of assets                                                                     8,922             2,645
           Capital Grants and Contributions                                                             (39,736)          (14,745)   The Council's risk management policies are established to identify and analyse the risks faced, to set appropriate limits and
           Share of Net (Profits)/Losses of Associates                                                   (5,846)           (6,508)   controls and to monitor these risks and adherence against limits. The Council aims to manage volatility to minimise potential
                                                                                                                                     adverse effects on the financial performance of the Council.
           Impairment of Receivables and Bad Debts Written Off                                                 4                 7
           Interest Expense capitalised in QTC loans                                                         697               527   The Council's Audit and Risk Committee (ARC) oversees how management monitors compliance with the Council's risk




                                                                                                                                                                                                                                                                              Noosa Council Annual Report 2022 - 2023
                                                                                                       (35,959)           (18,074)   management policies and procedures, and reviews the adequacy of the risk managements framework in relation to the risks
                                                                                                                                     faced by the Council. The ARC is assisted in its oversight role by internal audits conducted by external consultants, the results
           Changes in Operating Assets and Liabilities:                                                                              of which are reported to the ARC. Council's internal audit register, which is approved by the ARC, details target areas and the
           (Increase)/Decrease in Receivables                                                               (379)            (970)   timing for the completion of internal audits.
           (Increase)/Decrease in Inventories                                                                 (56)               1
           (Increase)/Decrease in Contract Assets                                                           (958)              487   Council does not enter into derivatives.
           (Increase)/Decrease in Other Assets                                                              2,780            1,717
           Increase/(Decrease) in Payables                                                                (7,602)            8,671   Credit risk
           Increase/(Decrease) in Contract Liabilities                                                    20,813             (547)
                                                                                                                                     Credit risk is the risk of financial loss if a counterparty to a financial instrument fails to meet its contractual obligations. These
           Increase/(Decrease) in Employee Leave Entitlements                                               1,350            (282)
                                                                                                                                     obligations arise principally from the Council's investments and receivables from customers.
           Increase/(Decrease) in Other Liabilities                                                             53          12,385
                                                                                                         16,001            21,462    Exposure to credit risk is managed through regular analysis of credit counterparty ability to meet payment obligations. The
                                                                                                                                     carrying amount of financial assets represents the maximum credit exposure.
           Net cash provided from/(used in) Operating Activities from the
           statement of cash flows                                                                      24,417            46,194     Investments in financial instruments are required to be made with Queensland Treasury Corporation (QTC) or similar
                                                                                                                                     State/Commonwealth bodies or financial institutions in Australia, in line with the requirements of the Statutory Bodies Financial
                                                                                                                                     Arrangements Act 1982.

           Note 28. Events after the reporting period                                                                                No collateral is held as security relating to the financial assets held by Noosa Shire Council.
      §Subnote§


                                                                                                                                     The carrying amounts of financial assets at the end of the reporting period represent the maximum exposure to credit risk for
                                                                                                                                     the Council.
      Council is unaware of any material or significant "adjusting" or "non adjusting events" that should be disclosed.
                                                                                                                                     The Council may be exposed to credit risk through its investments in the QTC Cash Fund and QTC working capital facility.
                                                                                                                                     The QTC Cash Fund is an asset management portfolio that invests with a wide range of high credit rated counterparties.
                                                                                                                                     Deposits with the QTC cash fund are capital guaranteed. Working capital facility deposits have a duration of one day and all
                                                                                                                                     investments are required to have a minimum credit rating of "A-", therefore the likelihood of the counterparty having capacity
                                                                                                                                     to meet its financial commitments is strong.

                                                                                                                                     Other investments are held with financial institutions, which are rated AAA to AA- based on rating agency Standard and
                                                                                                                                     Poor's ratings, and whilst not capital guaranteed, the likelihood of a credit failure is assessed as remote (if applicable).

                                                                                                                                     In the case of rate receivables, the Council has the power to sell the property to recover any defaulted amounts. In effect this
                                                                                                                                     power protects the Council against credit risk in the case of defaults.




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