Annual Report 2020-21

Noosa Council
Notes to the Financial Statements
for the year ended 30 June 2021

Note 20. Provisions
§Note/Subtotal§
§Subnote§




Annual Leave Provision
A liability for annual leave is recognised. Amounts expected to be settled within 12 months are calculated on current wage and
salary levels and includes related employee on-costs. Amounts not expected to be settled within 12 months are calculated on
projected futures wage and salary levels and related employee on-costs, and are discounted to present values. This liability
represents an accrued expense. As Council does not have an unconditional right to defer this liability beyond 12 months annual
leave is classified as a current liability.

Long Service Leave Provision
Long service leave liability is measured as the present value of the estimated future cash outflows to be made in respect
of services provided by employees up to the reporting date. The value of the liability is calculated using current pay rates
and projected future increases in those rates and includes related employee on-costs. The estimates are adjusted for the
probability of the employee remaining in the Council's employment or other associated employment which would result in the
Council being required to meet the liability. Adjustments are then made to allow for the proportion of the benefit earned to
date, and the result is discounted to present value. The interest rates attaching to Commonwealth Government guaranteed
securities at the reporting date are used to discount the estimated future cash outflows to their present value. The provision
is discounted using the Commonwealth Bond yeild rates published on the Department of State Development, Infrastructure,
Local Government and Planning website.

Where employees have met the prerequisite length of service and Council does not have an unconditional right to defer this
liability beyond 12 months long service leave is classified as a current liability. Otherwise it is classified as non-current.

Restoration Provisions
A provision is made for the cost of rehabilitation of assets and other future restoration costs where it is probable the Council
will be liable, or required, to incur such a cost on the cessation of use of the facility. This liability is provided in respect of
Quarries and Landfill sites.

Council has the following restoration provisions:

Landfill Sites
The provision represents the present value of the anticipated future costs associated with the closure of the Eumundi Rd landfill
sites, decontamination and monitoring of historical residues and leaching on the site.

The calculation of this provision requires assumptions such as application of environmental legislation, site closure dates,
available technologies and engineering cost estimates. These uncertainties may result in future actual expenditure differing
from amounts currently provided. Because of the long-term nature of the liability, the most significant uncertainty in estimating
the provision is the costs that will be incurred.

The provision recognised for the Eumundi Rd landfill sites is reviewed at least annually and updated based on the facts
and circumstances available at the time. Management estimates that the site will fully close in 2070 and that site restoration
will occur progressively over the subsequent thirty years. The provision recognises the costs associated with closure and
rehabilitation of historical and existing cells as well as the rehabilitation of the site following full closure in 2070.

Quarry Sites
The provision represents the present value of the anticipated future costs associated with the closure of the Ringtail Creek
quarry site, reclamation and rehabilitation of the site.

The calculation of this provision requires assumptions such as application of environmental legislation, site closure dates,
available technologies and engineering cost estimates. These uncertainties may result in future actual expenditure differing
from amounts currently provided. Because of the long-term nature of the liability, the most significant uncertainty in estimating
the provision is the costs that will be incurred. The provision recognised for quarry sites rehabilitation is reviewed at least
annually and updated based on the facts and circumstances available at the time.

$ '000                                                                                                  2021                2020

Current
Annual Leave                                                                                            3,156              2,952
Long Service Leave                                                                                      4,947              4,630
Total Current Provisions                                                                               8,103               7,582




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