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2015-01-12 General Committee Agenda Attachment 1 to Item 17 Noosa Council Report 2014
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ATTACHMENT 1
to Item 17
General Committee Agenda
12 January 2015
Report 2014
For the period 1 January 2014 to 30 June 2014
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Section 2
© Noosa Council 2014 www.noosa.qld.gov.au General Enquiries: By telephone: (07) 5329 6500 By email: [email protected] Fax: (07) 5329 6501 Street Address: 9 Pelican Street, TEWANTIN Postal address: PO Box 141, TEWANTIN QLD 4565 <Insert date document was endorsed by council>
Section 3
Table of Contents Mayor’s Message ............................................................................................................................ 3 Chief Executive Officer’s Message .................................................................................................. 4 This Report and De-amalgamation ................................................................................................. 5 Key Council Achievements ............................................................................................................. 5 Governance................................................................................................................................. 5 Service Delivery .......................................................................................................................... 6 Planning ...................................................................................................................................... 6 Community Engagement ............................................................................................................. 6 Organisation Establishment ......................................................................................................... 7 Finance ....................................................................................................................................... 7 Reportable Disclosures ................................................................................................................... 8 Information relating to Councillors ............................................................................................... 8 Overseas travel ......................................................................................................................... 13 Executive remuneration ............................................................................................................. 13 Commitment to equal opportunity employment .......................................................................... 13 Administrative action complaints ............................................................................................... 14 Council registers........................................................................................................................ 14 Community Grants 2013-2014................................................................................................... 15 Discretionary funds.................................................................................................................... 15 Beneficial enterprises ................................................................................................................ 15 Business activities ..................................................................................................................... 15 Significant business activity ....................................................................................................... 16 Competitive neutrality ................................................................................................................ 16 Commercial business units ........................................................................................................ 16 Services, facilities and activities, for which special rates/charges levied .................................... 17 Summary of concessions for rates and charges ........................................................................ 17 Invitations to change tenders ..................................................................................................... 19 Internal audit ............................................................................................................................. 19 Community Financial Report – 2013/14 ........................................................................................ 20 Background ............................................................................................................................... 20 Statement of comprehensive income ......................................................................................... 21 Statement of Financial Position ................................................................................................. 23 Statement of Changes in Equity ................................................................................................ 24 Statement of Cash Flows .......................................................................................................... 25 Financial Ratios ......................................................................................................................... 25 Noosa Council Report 2014 Page 1 of 27
Section 4
Appendix 1: Financial Statements 2013/14 Appendix 2: Councillors’ Expenses Reimbursement Policy Noosa Council Report 2014 Page 2 of 27
Section 5
Mayor’s Message
Noosa's long struggle to manage its own affairs is now a proud part of our history. So too will be
this Noosa Council “annual” report, the first since it was amalgamated with Caloundra and
Maroochy Councils in 2008. It covers the 6 month period from reinstatement of Noosa Council on
1 January 2014 to 30 June 2014.
The report will be deliberately concise because it covers such a short period, where the focus was
on establishing a functioning organisation as well as significantly improving service delivery and
establishing a sound financial base.
While all of the Council team are quietly proud of the progress that has been made, we are all too
aware that the first 6 months was just the start of a multi-year journey towards developing an
efficient organisation that delivers superior outcomes to our community.
My assessment of the position at the end of this reporting period is:
The Council was financially sustainable without a rate increase.
On the ground service delivery has been significantly improved since de-amalgamation,
with potential for future incremental gains.
The organisation delivered to expectations in a short time frame, but will need to embrace
continuous improvement to be at the leading edge of local government efficiency.
The success of Council in these early stages was achieved because of the inspiring efforts of a
small number of transfer team staff who worked incredible hours to ensure services to the
community were not interrupted on the rebirth of Noosa Council on New Year’s day, 2014. Both the
community and the Council owe them a great deal.
It is now the task of the whole Noosa Council team, staff and elected members, to build on that
huge effort in the years to come.
The enthusiasm generated by a battle won and a community back in charge of its own destiny
forged a bond between Councillors and an unprecedented level of co-operative working
relationships.
Further improvement throughout the organisation can help consign the poor culture that developed
during amalgamation to the dustbin of history. A new culture is a vital ingredient of an efficient
Noosa Council.
Finally, I want to acknowledge on behalf of the elected Council the efforts of our CEO and those
staff who frequently worked day and night, including weekends, during our first 6 months. They can
be particularly proud of the achievements in this report as well as others to come.
Noel Playford
Mayor
Noosa Council Report 2014 Page 3 of 27
Section 6
Chief Executive Officer’s Message Normally in an annual report, the CEO sets out the Council’s achievements over the previous 12 months towards achieving the goals that the Council has set in its 5 year Corporate Plan. In the context of establishing a new Council that simply does not apply, particularly given our Council did not adopt its first Corporate Plan until 26 June 2014. However, there is still a lot that our Council has achieved in its first 6 months of operations that can be reported on to the community. Although Council officially began on 1 January 2014, the foundations for the new Council were set well before that time. The Transfer Manager (Mr Peter Franks) and his small team of staff worked tirelessly in the lead up to the commencement date to ensure that Council could begin operations on 1 January 2014. I would like to recognise the great job that Peter and the Transfer Team did to put in place the building blocks so Council could commence providing services to the Noosa community from day one. We made great progress in setting up a new organisation, establishing a sound financial footing, and significantly improving service delivery to our community. Further details on the achievements from the first six months are set out in this annual report. This report also sets out a lot of information that is required to be reported as part of the Council’s statutory obligations. As a Council, we have started well but there is still a lot to do. Our community has high expectations of its Council and rightly so. The challenge for the future is to build on our first six months and aim to be the best we can be for our community. This will require our Council organisation to continually improve its performance across all of our services and activities. We should never accept the status quo and will need to keep challenging ourselves as to how we can deliver better services more efficiently to the Noosa community. Ultimately, our goal is to be a Council that our community can be proud of. The Council has established a strong base in its first six months to work towards that goal. Brett de Chastel Chief Executive Officer Noosa Council Report 2014 Page 4 of 27
Section 7
This Report and De-amalgamation
The Local Government Act 2009 (LG Act) and the Local Government Regulation 2012
(LG Regulation), requires local governments of Queensland to prepare an annual report for each
financial year, which reports Council specific information in a number of mandatory areas.
As previously identified, this is Noosa Council’s first report since it was re-established on
1 January 2014. Accordingly, the relevant reporting period for this report is from 1 January 2014 to
30 June 2014.
Key Council Achievements
In reporting to the community on Council’s achievements towards achieving its goals in the first
6 months of operations, it makes sense to identify a number of themes, namely:
Governance;
Service Delivery;
Planning;
Community Engagement;
Organisation Establishment; and
Finance.
These themes reflect the duality of purpose that the Council had in that period of both improving
the provision of services to the Noosa community, and establishing a new Council.
Governance
The Council established a decision making framework based on a Committee system. The
Council established the following Committees with Councillor membership as follows:
Planning and Organisation Committee:
Crs. Wilkie (Chairperson), Jurisevic, Playford and Wellington;
Infrastructure and Services Committee:
Crs. Bolton (Chairperson), Abbot, Pardon and Playford;
General Committee:
All Councillors are members of the General Committee (Chairperson is Cr Wellington).
These Committees made recommendations to Council which met each month to consider those
recommendations. Noosa Council has a deliberate practice of ensuring that its Council meetings
are open to the public and rarely closes its meetings.
Council also implemented a number of governance decisions which, while not particularly exciting,
were necessary to establish a functioning local government and in the community’s best interest.
These included:
Agreement to establish an Audit Committee (which commenced in the 2014/15 financial year);
Adoption of a Procurement Policy to guide Council’s purchasing practices; and
Establishment of a system of delegations to allow for quicker decision making.
Noosa Council Report 2014 Page 5 of 27
Section 8
Service Delivery
The focus in the first 6 months of operation was on ensuring that the Noosa community not only
received a seamless service delivery transition on 1 January 2014 but also to ensure that quality
services were delivered. The key initiative undertaken was the re-introduction of the Noosa
Maintenance Manual. This manual set out the standards of service that the community can expect
and effectively restored the levels of service that the community had been accustomed to prior to
amalgamation. More frequent street sweeping, better park maintenance, restoring the
streetscapes and better maintenance of high profile areas were all implemented in the first 6
months of Council operation.
Council also undertook some projects including:
Kerbside collection – the Council undertook a kerbside collection program. The free kerbside
collection program resulted in 1,501 tonnes of waste being collected from Noosa Shire
households;
Council website – an new website was published to provide the community with access to a
wide range of Council information;
Capital Works Program – Council had a limited Capital Works Program in its first 6 months. It
inherited relatively few capital works projects that were ready to be delivered but Council spent
a considerable amount of time developing a comprehensive Capital Works Program for the
2014/15 financial year; and
Noosa Planning Scheme review – the Council initiated a minor review of the Noosa Planning
Scheme to update the scheme prior to a full scheme review which will be undertaken in
approximately 2 years’ time.
Planning
While most of the focus of the Council in the first 6 months of operations has been on service
delivery and establishment of the new organisation, Council also found time to begin planning
ahead, looking at long term strategies that will help shape the future of Noosa. Some of these
included:
A review of the management arrangements for the Noosa Biosphere Reserve;
Commencement of a major review of our Waste Management Strategy;
Adoption of the Noosa Council Corporate Plan 2014 to 2019; and
Development of a disaster management planning framework and undertaking a number of
training exercises to ensure that Council is ready for any future natural disasters.
Community Engagement
One of the reasons why so many Noosa residents supported the re-establishment of the Noosa
Shire Council was the opportunity to engage with their local Council. Many residents took this to
heart and gave the Council a call to welcome us back, which resulted in an overload on our phone
system. We received an almost 300% increase in calls in those first few months as our community
rang to touch base on issues they wanted to talk about.
We also saw quite a lot of residents come along to Council meetings to observe open democratic
process. We held out first community based Council meeting in Pomona in May 2014. This was
an opportunity for Pomona residents to come and meet Councillors and senior staff and to have a
conversation about issues that were important to them. We will hold more of these community
based Council meetings in the future.
Noosa Council Report 2014 Page 6 of 27
Section 9
During this period, we also began to lay the foundations for a deeper level of community
engagement. We began to build the “Your Say Noosa” online portal which gives our community
another avenue to provide feedback on important projects. This portal went live after 30 June
2014. We also began to research how a “community jury” could operate in the Noosa context.
That concept is being developed further in 2014/15.
Organisation Establishment
After initially adopting an interim organisational structure in April 2014, the Council adopted its
permanent organisational structure on 26 June 2014. The structure is based on the following
Departments:
Community Services Department;
Corporate Services Department;
Executive Office; and
Planning and Infrastructure Department.
The appointment of a CEO, Directors and Managers was also completed in this period. As at 30
June 2014, Council’s adopted organisational structure included an equivalent full time staffing level
of 343. Workplace Health and Safety (WH&S) policies and practices have also been established
but there is a lot more work to be done in the WH&S area.
Finance
As a result of the de-amalgamation process, Council adopted two budgets within a 6 month period.
Council adopted an interim budget on 2 January 2014 which effectively continued the previous
Sunshine Coast Regional Council budget for the Noosa area to 30 June 2014. There was no
increase in rates or change to the rates structure in that budget.
The main focus for the Council in its first 6 months was the development of its long term financial
model and the preparation of the 2014/15 financial year budget. Both were completed and the
2014/15 budget was adopted on 26 June 2014. That budget will set the foundation for Council’s
long term financial future. Specifically, the 2014/15 budget contained the following:
Development of the budget from a zero base, to ensure that the full cost of delivering current
levels of services were understood and appropriately costed;
No increase in general rates;
Significant capital works program – which included the adoption of a $22.3 million program
which was greater than the capital works program for the Noosa area compared to the previous
year. The main focus is on the renewal of assets (particularly roads and bridges); and
Financial ratios – Achievement of all financial ratio benchmark targets set by the Queensland
Government for financially sustainable Councils and in particular, achievement of the asset
sustainability ratio which reflects the fact that Council is fully funding the restoration of its
existing asset base – a key indicator for a financially sustainable Council.
Noosa Council Report 2014 Page 7 of 27
Section 10
Reportable Disclosures
Information relating to Councillors
Remuneration
Councillor remuneration is set by the independent Local Government Remuneration and Discipline
Tribunal established under the LG Act. The Tribunal determines remuneration for Mayors, Deputy
Mayors and Councillors and releases a report in December each year which establishes single
remuneration levels for the following year. The remuneration for the Councils which de-
amalgamated and commenced operations on 1 January 2014, was not prescribed in the 2012
report of the Tribunal.
This issue was circumvented by s11 of the Local Government (De-amalgamation Implementation)
Regulation 2013, which required the Tribunal to determine the category and remuneration for the
de-amalgamating Councils by September 2013.
By way of Queensland Government Gazette, dated 30 August 2013, the Tribunal listed Noosa
Council as a Category 4 Council, and prescribed that the annual rate of remuneration for the Mayor
and Councillors for the period as follows:
Mayor - $112,462;
Deputy Mayor - $70,289; and
Councillors - $59,746.
In accordance with s244 (3) of the LG Regulation, the remuneration prescribed by the Tribunal
cannot include:
Any amount for expenses to be paid or facilities to be provided to a Councillor of a local
government under its expenses reimbursement policy; or
Any contribution a local government makes for a Councillor to a voluntary superannuation
scheme for Councillors established or taken part in by the local government under s226 of the
LG Act.
The LG Act does however allow a local government to take part in a superannuation scheme for its
Councillors and Council on 20 January 2014 authorised the payment of superannuation
contributions for Councillors of up to 12% of their annual salary on the condition that Councillors:
Contribute an amount of up to 6% from their salaries and Council contributes a proportionate
amount of up to 12% to a nominated superannuation fund;
Make contributions through an arrangement by way of a formal request to Council; and
Nominate the preferred superannuation fund, and where no nomination has occurred, the
superannuation payments be made to LG Super.
Noosa Council Report 2014 Page 8 of 27
Section 11
Councillor remuneration for period 1 January 2014 to 30 June 2014
Councillor Salary ($) Superannuation ($) Total ($)
(* see note)
Mayor Noel Playford 56,231 6,701 62,457
Cr Robert Abbot (Deputy) 35,145 3,767 38,670
Cr Joseph Jurisevic 29,873 3,202 32,870
Cr Frank Pardon 29,873 3,560 33,228
Cr Anthony Wellington 29,873 3,643 33,311
Cr Frank Wilkie 29,873 3,202 32,870
Cr Sandra Bolton 29,873 3,202 32,870
Notes:
1. The amounts of Councillors superannuation varied because of different ‘take up’ dates by individual
Councillors
2. Amounts rounded to the nearest whole dollar value.
Reportable Council resolutions for the period
Local Government Resolution adopted Ordinary meeting
Regulation 2012
Section 250(1) Endorse the Councillors’ Expenses Reimbursement 2 January 2014
Policy.
Request the Chief Executive Officer to make a copy
of the Policy available for public inspection at the
Tewantin Office and to publish the Policy on the
Noosa Council website.
Section 250(2) Adopt the amended ‘Councillors’ Expenses 26 June 2014
Reimbursement Policy’ put forward by The Planning
& Organisation Committee recommendation dated
17 June 2014, in which the Mayor elected not to
receive any financial reimbursement for private
vehicle use for Council business moving forward.
Section 206(2) None. -
Noosa Council Report 2014 Page 9 of 27
Section 12
Councillors’ expenses and resources provided
The Councillors’ Expenses Reimbursement Policy (the Policy) (refer to Appendix 2) ensures
Councillors are provided a reasonable level of resources and equipment in order to carry out their
duties in an effective and efficient manner.
The Policy is compliant with the following principles prescribed by the LG Act:
Transparent and effective processes and decision-making in the public interest; and
Good governance and legal behaviour of Councillors and local government employees.
The categories of expenses and eligibility for reimbursement as per the Policy include:
Mandatory professional development;
Discretionary Professional Development;
Travel as Required to Represent Council;
Private Vehicle Usage;
Meal Costs;
Hospitality;
Accommodation;
Administration Tools and Access to Council Office Amenities;
Safety Equipment;
Home Office and Telecommunication needs; and
Insurance Cover.
Summary of expenses/reimbursements paid to Councillors for the period
Under s186 of the LG Regulation the reimbursements that were made to Councillors for the period
were for mandatory and discretionary professional development, vehicle use, home office and
telecommunication, and accommodation expenses incurred whilst on Council business.
For the period:
All claimed expenses were processed and fell within the required limits prescribed by the Policy
(refer to Appendix 2).
No Councillors claimed expenses relating to categories of travel, meals or hospitality expenses.
It is noted that in accordance with the amendment to the Policy endorsed by Council on
26 June 2014, the Mayor elected not to receive any financial reimbursement for private vehicle use
for Council business moving forward.
Noosa Council Report 2014 Page 10 of 27
Section 13
A summary of expenses/reimbursements to Councillors for the period is outlined in the table below.
Councillor Expenses
Councillor Mandatory Discretionary Use of private Home office & Accom TOTAL
Professional Professional vehicle (option tele- ($) ($)
Development Development 1) communication
($) ($) ($) ($)
Mayor Noel Playford - - 2,500 1,440 - 3,940
Cr Robert Abbot 1,000 2,500 1,440 - 4,940
Cr Joseph Jurisevic 318 1,025 2,500 1,440 531 5,814
Cr Frank Pardon - 2,500 1,440 - 3,940
Cr Anthony Wellington - 9 2,500 1,440 - 3,950
Cr Frank Wilkie - 2,500 1,440 - 3,940
Cr Sandra Bolton 318 9 2,500 1,440 - 4,267
Note: Amounts rounded to the nearest whole dollar.
The attendance of Councillors at Ordinary meetings, Special meetings and Committees for the
period is outlined in the table below.
Council Meetings, Standing and Special Committees attendance for the period
Councillor Ordinary General Planning & Infrastructure & Special & Total
meetings Committee Organisation Services Budgetary
Committee Committee
Mayor Noel Playford 9 6 5 5 2 27
Cr Robert Abbot 9 6 N/A 4 2 21
Cr Sandy Bolton 9 6 N/A 5 2 22
Cr Joe Jurisevic 9 6 5 N/A 2 22
Cr Frank Pardon 9 6 N/A 5 2 22
Cr Anthony Wellington 9 6 5 N/A 2 22
Cr Frank Wilkie 9 6 5 N/A 2 22
Noosa Council Report 2014 Page 11 of 27
Section 14
Complaints about Councillors
Sections 176 to 182 (inclusive) of the LG Act prescribe the requirements for local governments for
dealing with complaints about the conduct and performance of Councillors so as to ensure that:
Appropriate standards of conduct and performance are maintained; and
A Councillor who engages in misconduct or inappropriate conduct is disciplined.
The Councillor Code of Conduct Policy endorsed by Council on 13 January 2014 establishes:
The responsibilities of Councillors under the LG Act;
The standards of behaviour and ethical obligations expected Councillors in Noosa Shire; and
A clear administrative method for handling and resolving complaints made about the conduct
and performance of Councillors in accordance with Division 6 of the LG Act.
The table below identifies that there were no reportable complaints, orders and recommendations
against Councillors for the period.
Reportable information relating to complaints against Councillors: Number of
complaints:
(for the period)
(i) The number of orders and recommendations made under s180 (2) or (4) of the LG NIL
Act.
(ii) The number of orders made under s181 of the LG Act. NIL
(iii) The number of complaints made about the conduct or performance of a Councillor NIL
for which no further action was taken under s 176C(2) of the LG Act.
(iv) The number of complaints referred by the Council CEO to the department’s chief NIL
executive under s176C (3)(a)(i) of the LG Act.
(v) The number of complaints referred to the Mayor under s176C (3)(a)(ii) or (b)(i) of NIL
the LG Act.
(vi) The number of complaints referred to the department’s chief executive under s NIL
176C (4)(a) of the LG Act.
(vii) The number of complaints assessed by the Council CEO as being about corrupt NIL
conduct under the Crime and Corruption Act.
(viii) The number of complaints heard by a regional conduct review panel. NIL
(ix) The number of complaints heard by the tribunal. NIL
(x) The number of complaints to which s176C (6) of the LG Act applied. NIL
Noosa Council Report 2014 Page 12 of 27
Section 15
Overseas travel
No Councillor or Council employee in an official capacity made any overseas travel during the
period.
Executive remuneration
Under the LG Act, the annual report of a local government must state the total remuneration
packages that were payable during the reporting period to its senior management, and the number
of employees in senior management who are being paid each of the total remuneration packages.
The senior management of a local government consists of the chief executive officer and all senior
executive employees of the local government. A senior executive employee is an employee who
reports directly to the chief executive officer and whose position would ordinarily be considered to
be a senior position in the corporate structure.
The total of remuneration packages payable to senior management during the period was
$543,180.
The annual package bands for Council’s senior management team are outlined below.
Package Band Number of senior
management employees
$100,000 - $200,000 4
$200,001 - $300,000 1
Commitment to equal opportunity employment
Council is an equal opportunity employer, which is committed to providing equal employment
opportunities for its current and prospective employees.
Council recognises the importance workforce diversity and promotes a working environment where
people are treated on their merits at every stage of their employment.
Council’s equal opportunity framework is aligned to Queensland’s Anti-Discrimination Act 1991 and
the following federal anti-discrimination laws:
Age Discrimination Act 2004;
Racial Discrimination Act 1975;
Disability Discrimination Act 1992; and
Sex Discrimination Act 1984.
At Council all staff are encouraged to embrace equity and diversity at all levels within the
organisation. Council will continue to strive to build a workforce and supporting organisational
culture that reflects the diversity of the greater community and is free of all forms of discrimination
and harassment.
Noosa Council Report 2014 Page 13 of 27
Section 16
Administrative action complaints
Council is committed to managing customer feedback and ensuring all complaints are dealt with in
a fair, prompt and confidential manner. Council aspires to provide a level of service that does not
attract complaints. However, Council acknowledges the public’s right to provide feedback on
services, including the right to lodge a complaint about a decision or other action Council has
taken, or failed to take, where considered appropriate to do so.
At the ordinary meeting held on 29 May 2014, Council adopted a new Administrative Action
Complaint Process rescinding the Complaints Management Process that was transferred to the
Noosa Council from the Sunshine Coast Council under the Local Government (De-amalgamation
Implementation) Regulation 2013.
The policy has been developed to ensure:
Complaints are handled in a structured, timely and professional manner which is fair,
considerate and respectful of privacy;
All staff members are aware of their responsibilities regarding the complaints; and
Complaints are used to identify problems and to continuously improve the Council’s services.
A copy of the Council’s Administrative Action Complaint Process Policy can be viewed on Council’s
website.
Complaint statistics 1 January 2014 to 30 June 2014
Number of Administrative Action Complaints Progress during the period
1 Escalated to internal review
During the period, Council received one administrative action complaint. This was not resolved at
the first tier of the complaints process and was referred to a second-tier internal review. Council will
be able to report on the outcome of this review in the 2014-15 annual reporting period.
Council registers
Council is required under the LG Regulation to develop and maintain certain registers. A number of
these registers are available for public inspection at the Tewantin Office or can be viewed on
Council’s website.
Below is a list of the registers kept by Council:
Asset Register;
Delegations Register;
General Cost Fees and Commercial Charges;
Engineering and Environment Fees and Charges;
Planning Fees and Charges;
Plumbing Fees and Charge;
Other Development Fees and Charges;
Local Laws Register;
Roads Register;
Instrument of Appointments;
Noosa Policy Register; and
Registers of Interests.
Noosa Council Report 2014 Page 14 of 27
Section 17
Community Grants 2013-2014
The following table outlines the funds supplied by Council through community grants for the period.
Community Grants Funding Amounts
Regional Arts Development Fund $12,840
Fish Hatchery $10,000
Community Pools $11,500
TOTAL: $34,340
Discretionary funds
Section 109 of the LG Act, defines discretionary funds as funds in the local government’s
operating fund that are:
Budgeted for community purposes; and
Allocated by a Councillor at the Councillor’s discretion.
There were no Councillor discretionary funds established during the period.
Beneficial enterprises
Section 39(3) of the LG Act defines a beneficial enterprise as an enterprise that a local
government considers is directed to benefiting, and can reasonably be expected to benefit, the
whole or part of its local government area.
Section 39(4) of the LG Act provides that a local government is conducting a beneficial enterprise if
the local government is engaging in, or helping, the beneficial enterprise.
For the period, Noosa Biosphere Ltd was considered a beneficial enterprise conducted by Council.
Business activities
A business activity is defined in Schedule 4 of the LG Act as “the trading in goods and services
by the local government”.
Council conducted the following business activities during the period:
Waste Management; and
Operations of Holiday Parks including the Boreen Point Campground, Noosa North Shore
Beachfront Caravan Park and Noosa River Holiday Park.
Noosa Council Report 2014 Page 15 of 27
Section 18
Significant business activity
In accordance with threshold of expenditure and the methodology prescribed by ss. 19 and 20 of
the LG Regulation, Council’s Waste Management activity was considered a new significant
business activity for the period.
Council confirms that a public benefit assessment for Waste Management will be undertaken for
the 2015-2016 reporting period.
Competitive neutrality
By resolution at the ordinary meeting held on 6 March 2014, Council adopted to:
Apply the Competitive Neutrality Principle to its Waste Management business activity for the
remainder of the 2013/14 financial year in accordance with s44(1)(b) of the LG Act; and
Apply the Code of Competitive Conduct to the Holiday Parks business activity for the
remainder of the 2013/14 financial year in accordance with s47 of the LG Act.
Council’s action confirms that it is committed to ongoing compliance with National Competition
Policy principles and its legislative obligations in this area. It is committed to ensuring that its
business activities operate on a level playing field with private businesses in the community.
Council ensures that the pricing practices for each business activity complies with the principles of
full cost pricing such that total revenue, inclusive of identified and measured community service
obligations and net of any advantages and disadvantages of public ownership, should aim to cover
the following elements:
Operational and resource costs;
Administration and overhead costs;
Deprecation;
Tax and debt equivalents; and
Return on capital / return on cost.
During the period, there were no investigation notices provided to Council relating to competitive
neutrality complaints. Accordingly, The Queensland Competition Authority did not make any
reportable recommendations to Council in relation to a competitive neutrality complaint.
Commercial business units
Pursuant to s 27(2) of the LG Regulation, a commercial business unit is a business unit that
conducts business in accordance with the prescribed key principles of commercialisation.
Council did not nominate any business activities as commercial business units during the period.
Noosa Council Report 2014 Page 16 of 27
Section 19
Services, facilities and activities, for which special rates/charges
levied
Below is a list of Council levies and special charges for the period:
Tourism Levy;
Noosa Waters Lock and Weir Maintenance Levy;
Noosa Junction Levy;
Noosa Main Beach Precinct Streetscape Levy;
Rural Fire Charge;
Hastings Street Community Safety Program Charge; and
Lower Noosa North Shore Electricity Charge.
Summary of concessions for rates and charges
General rate concessions
In addition to those classes of land granted a general rate exemption under s93(3) of the LG Act
and s73 of the LG Regulation, Council was able to grant a general rates concession to land
identified in s20(1)(b) of the LG Regulation to the extent that Council was satisfied the land at the
relevant time was owned by an entity whose objects do not include making a profit, or an entity that
provides assistance or encouragement for arts or cultural development and is one of the following:
Boy Scout and Girl Guide Associations;
Surf Lifesaving and Coastguard organisation;
Community Sporting Organisation – Not for profit organisations without a commercial liquor
licence or a community club liquor licence;
Community Cultural or Arts Organisation – Not for profit organisations without a commercial
liquor licence or a community club liquor licence; or
Charitable Organisations, which are:
(a) Not for profit organisation; and
(b) Registered as a charity institution or a public benevolent institution; and
(c) Providing benefits directly to the community; and
(d) Endorsed by the Australian Tax Office - Charity Tax Concession.
The relevant concession for the period for eligible entities was 100% of the general rate.
Deferral of general rates
To assist eligible pensioners who have experienced large increases in the value of their property
as determined by the Department of Natural Resources and Mines, or have experienced financial
hardship, Council allows deferment of up to 50% of the general rate by way of application.
The deferred rates accumulate as a debt against the property until it is sold or until the death of the
ratepayer.
Noosa Council Report 2014 Page 17 of 27
Section 20
The deferment of general rates applies only to rates payable with respect to land included in
Differential General Rates Categories 1, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 28 & 30.
To be eligible to defer up to 50% of the general rate the applicant must:
Own and occupy the property; and
Have no overdue rates and charges on the said property; and
Be the holder of a Pension Concession Card issued by Centrelink or the Department of
Veteran Affairs; or
o A Repatriation Health (Gold) Card issued by the Department of Veteran Affairs; or
o A Commonwealth Seniors Health Card; or
o A Queensland Seniors Card issued by the Queensland State Government.
Automatic eligibility applies to those ratepayers currently receiving a Pension Concession on their
rate notice. Eligibility for those ratepayers with a Seniors Card will be assessed accordingly.
Interest charges on deferred rates
In accordance with s122(5) of the LG Regulation, Council is authorised to charge interest, or
request payment of an additional charge, to all deferred general rates for the relevant period.
For the period there were no rate payers who applied for a deferral of their general rates.
Available pensioner concessions for the period
Summary of pensioner concessions available during the period
Pension Rate Sole title to the property Joint title to the property
Maximum level of pension $230 p.a. maximum $180 p.a. maximum
$115 per half year $90 per half year
Not maximum level of $115 p.a. maximum $65 p.a. maximum
pension $57.50 per half year $32.50 per half year
Single owner on the maximum rate of pension
Where the pensioner was in receipt of the maximum level of pension and had sole title to the
property that is their principal place of residence for the period the concession was 25% of the
general rate up to a maximum amount of $230.00 per annum.
Joint owner on the maximum rate of pension
Where the pensioner was in receipt of the maximum level of pension and owned the property
jointly with one or more people for the period the concession was 25% of the general rate up to a
maximum amount of $180.00 per annum.
Noosa Council Report 2014 Page 18 of 27
Section 21
Single owner not on the maximum rate of pension Where the pensioner was not in receipt of the maximum level of pension and had sole title to the property that was their principal place of residence for the period the concession was 25% of the general rate up to a maximum amount of $115.00 per annum. Joint owner not on the maximum rate of pension Where the pensioner was not in receipt of the maximum level of pension and owned the property jointly with one or more people for the period the concession was 25% of the general rate up to a maximum amount of $65.00 per annum. Invitations to change tenders There were no reportable invitations made by Council to change tenders during the period. Internal audit Internal Audit provides Council with an independent, objective assurance and consulting activity designed to add value and improve the organisation’s operations. It helps Council accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control and governance processes. Section 105 of the LG Act provides that each Council must establish an internal audit function and that large councils must establish an audit committee. On 6 March 2014, Council established the Audit Committee and endorsed the Mayor and Cr Wellington as the Councillor Representatives on the Committee. Council also authorised the CEO to invite applications for two suitably qualified and experienced external members and to seek quotations for the provision of an internal audit service. It is noted that at the ordinary meeting on 31 July 2014 Council endorsed the appointment of two external members to the Audit Committee and subsequently on 28 August 2014, endorsed the Noosa Council Audit Committee Charter and the Risk Management Policy. The next annual report will contain a detailed report on the status and outcome of the above recommendations for the 2014-15 reporting period. Noosa Council Report 2014 Page 19 of 27
Section 22
Community Financial Report – 2013/14
Background
This is the first financial report of the Noosa Council following the de-amalgamation from the
Sunshine Coast Regional Council on 1 January 2014. This community financial report aims to
simplify the financial information required to be prepared by Council under legislation and
accounting standards, and provides a simpler overview of financial performance and sustainability
of our Council for the period 1 January 2014 to 30 June 2014.
Council’s financial statements are prepared based on accounting standards, and contain specific
information regarding Council’s financial performance for the relevant period. Financial statements
include a statement of comprehensive income (or profit and loss), a statement of financial position
(or balance sheet), a statement of cash flows as well as a statement of changes in equity.
Collectively, the statements provide a formal picture of the financial strength of an organisation
(refer to Appendix 1).
The Community Financial Report consists of five key reporting elements, each of which has a
specific purpose for the measurement and presentation of Council’s finances. The five key
reporting elements are shown below:
Statement of
Comprehensive
Income
Statement of
Statement of Financial
Ratios
Financial
Cash Flows
Position
Statement of
Changes in
Equity
Noosa Council Report 2014 Page 20 of 27
Section 23
Statement of comprehensive income
This statement (also known as the profit and loss) measures how Council performed financially in
relation to its operations during the financial year. In simple terms, it illustrates how the money
received from rates and other income sources is spent on the provision of services to the
community. Being the first period of operation for the new Council, there is no comparative data
available.
Figure 1 - 6-month revenue and expenditure
Council “Normal”
Operations
2013/14 2013/14
($’000) ($’000)
Revenue 1,016,937 42,372
Expenses 44,475 39,331
Net Result 972,462 3,041
The “Council” revenue position of $1,016.9 million includes $972 million net gain on de-
amalgamation, which is an accounting entry to recognise the net value of assets and liabilities
transferred from Sunshine Coast Regional Council. In the course of normal operations, and
excluding one off costs associated with the adoption of the permanent organisation structure,
Council achieved a modest operating surplus of $3 million.
Operating revenue – where the money came from
Throughout the 6 month period Council received a total of $42.4 million in operating revenues
(rates, fees, operating grants); $2.4 million in capital revenue (developer contributions, capital
grants); and $972 million recorded as revenue but which resulted from the transfer and revaluation
of assets and liabilities from Sunshine Coast Regional Council. The sources of Council’s operating
revenue are shown below.
Figure 2 – Operating revenue sources 2013/14
Revenue from
Grants & Other Unitywater
Revenue 2%
15%
Interest Revenue
6%
Fees & Charges
5%
Rates & Utility
Charges
72%
Noosa Council Report 2014 Page 21 of 27
Section 24
The above breakdown in operating revenue confirms that Council has significant control over the
majority of its income sources, and as a result is not overly reliant on other levels of government or
external agencies to maintain its financial independence. Key Council revenue sources include:
Rates and utility charges include general rates, charges for waste collection and disposal,
special rates such as the tourism and transport levy, and other separate and special rates.
Growth in rateable properties for the period was negligible.
Fees and charges include a range of regulatory fees and charges and revenue from
commercial operations such as the holiday parks and waste operations.
Interest revenue includes the return from the investment of surplus funds.
Revenue from Unitywater relates to the return on Shareholder Participation loans.
Operating expenditure – where the money goes
Council expended a total of $44.2 million in undertaking operating activities for the six month
period ($39.3 million excluding one-off items). The following graph shows a breakdown by
expenditure type for normal recurrent Council operations.
Figure 3 – Operating expenses by function 2013/14
Depreciation
20%
Employee
Finance & Other
Benefits
Costs
34%
3%
Materials &
Services
43%
Key performance statistics from the 6 month period include:
Employee benefits - includes staff wages, superannuation, fees paid to Councillors and other
employment costs. The total costs in the Statement of Comprehensive Income for the year
included $4.83 million in costs associated with the restructure of the organisation that will not
be recurrent.
Depreciation expenditure records the consumption of community infrastructure assets over
their respective useful lives, and provides an indication of the level of required expenditure on
rehabilitation and renewal of existing assets annually.
Noosa Council Report 2014 Page 22 of 27
Section 25
De-amalgamation Costs
The de-amalgamation of Noosa Council from the Sunshine Coast Regional Council took effect on
1 January 2014. The de-amalgamation process was managed during 2014 by the Noosa Council
Transfer Manager and his Transfer Team who prepared for commencement of Council operations
from 1 January 2014. Pursuant to the Local Government (De-Amalgamation Implementation)
Regulation 2013, a Transfer Committee was established to facilitate the de-amalgamation,
including the role of deciding costs associated with the de-amalgamation that were to be payable
by the Noosa Council.
The Transfer Committee finalised its role on 30 June 2014. At that time, it had approved de-
amalgamation costs totalling $2.57 million. Council used a line of credit provided by the
Queensland Treasury Corporation to fund the payment of the majority of those de-amalgamation
costs. As at 30 June 2014, the balance of that line of credit was $2.23 million. Council has
budgeted to fully pay off that line of credit by 31 December 2014.
Council spent a lot of time and effort in its first six months of operations establishing the new
organisation and systems. Costs associated with this “start-up” phase from 1 January 2014 have
been dealt with as normal operating costs of running a local government. The Council was able to
identify significant operational savings in this period as part of the establishment of the new
organisation and these ongoing savings enabled it to adopt its 2014/15 budget on 29 June 2014
with no general rate increase.
Statement of Financial Position
The Statement of financial position (or balance sheet) measures what Council owns (i.e. its
assets); and what we owe (i.e. liabilities) to determine the total community equity (net worth) at the
end of each financial year. Overall, Council’s net financial position improved during the reporting
period.
Figure 4 - Summary balance 6-month movement
Transferred Consolidated
Balances 2013/14
($’000) ($’000)
Assets 1,031,643 1,034,753
Liabilities 59,445 61,253
Community
972,198 973,500
Equity
Assets – what we own
Current Assets are represented by cash, investments, inventories and receivables (money owed to
Council). Council’s current assets as at 30 June 2014 were valued at $47.8 million.
Non-Current assets of $986.9 million, includes the value of Council’s investment in Unitywater, plus
property, plant and equipment totalling $875.7 million. The property, plant and equipment
represents community infrastructure and other operational assets owned and controlled by
Council. The main non-current asset categories and their respective written down values are
shown in the following figure.
Noosa Council Report 2014 Page 23 of 27
Section 26
Figure 5 – Non-Current Assets & Community Infrastructure ($,000)
Intangible Assets,
Other $2,269 Land &
Infrastructure, Improvements,
$54,357 $120,945
Stormwater & Work in Progress,
Drainage $1,523
Buildings,
Network, $59,360
$104,337
Plant &
Equipment,
$7,235
Road & Bridge
Network,
$525,691
Liabilities – what we owe
Money owed by Council is shown as both current and non-current liabilities in the statement of
financial position. Current liabilities are those amounts that are payable by Council within the next
twelve months, and non-current liabilities are payable beyond the twelve month horizon. The most
significant element is loans raised by Council to fund the investment in community infrastructure.
Council holds a total of $41.2 million in loans with the Queensland Treasury Corporation, with
highly competitive interest rates borrowed over a twelve year term. The legislative and policy
constraints imposed upon Council for borrowing activities are outlined in the borrowing policy
(available on Council’s web site).
Council inherited $40 million in loans transferred from Sunshine Coast Regional Council on de-
amalgamation, plus $2.3 million in new loans raised by Council during the six month period. The
forward budget projections show that inherited debt will be fully paid within 12 years, and there are
no significant new borrowings proposed at this stage, though Council has significant capacity to
raise new loans for future infrastructure development.
Additional details on Council’s debt position and its relationship to other elements of the financial
statements are contained in the financial ratio section of this report.
Statement of Changes in Equity
The statement of changes in equity illustrates how the net worth has changed as a result of
Council’s operations through the period. Council commenced operations in January, and the net
assets identified in the statement of financial position equate to the shire equity (retained earnings
and shire capital).
Noosa Council Report 2014 Page 24 of 27
Section 27
Statement of Cash Flows
The statement of cash flows shows where Council has generated cash, and where these funds
have been expended. The detailed schedule in the financial statements is summarised below
(columns above the line represent cash flowing into the organisation, and columns below the line
represent cash payments made).
Figure 6 – 6-month net cash flow sources ($’000)
$6,000
$5,000
$4,000
$3,000
$2,000
$1,000
$0
-$1,000
-$2,000
-$3,000
-$4,000
Operating Activities Investing Activities Financing Activities Net Movement in Cash
Operating activities depicts the net of income received from rates, interest, grants, etc. and
payments made to suppliers and employees (net increase).
Investing activities relate to the acquisition and sale/disposal of long-term assets, generally in
the form of roads, bridges, plant and equipment, etc. A negative outcome here represents a net
investment in community infrastructure during the reporting period.
Financing Activities shows the receipt and repayment of Council borrowings.
Net Movement in Cash represents the physical movement of cash, with any accounting
adjustments and accruals removed. The net movement in cash for the year of $1.56 million
represents the net increase in cash on hand, with all significant outlays fully funded within the
period.
Financial Ratios
Ratios are useful tools for getting a snap-shot of the financial status and trends of an organisation.
Ratios can also be useful in comparing Noosa Council to other Councils to gain an understanding
of relative financial strength. This analysis is undertaken annually by the Queensland Treasury
Corporation in assessing the financial sustainability of Council. Noosa Council will undergo a full
credit review by the Queensland Treasury Corporation early in 2015.
With the implementation of the LG Regulation, reporting against a number of sustainability ratios
was mandated, including target ranges for each measure. Details of these ratios are shown below,
including actual results for the reporting period, plus projections over the next 9 years.
Noosa Council Report 2014 Page 25 of 27
Section 28
Figure 7 – Financial ratios (actual and forecast)
Period Ended 30-Jun-14 30-Jun-15 30-Jun-16 30-Jun-17 30-Jun-18 30-Jun-19 30-Jun-20 30-Jun-21 30-Jun-22 30-Jun-23
Sustainability Ratios
Operating Surplus Ratio
Operating Position (6.5)% 0.1% 1.8% 2.7% 3.6% 4.5% 5.3% 6.1% 6.9% 7.8%
Local Govt Act upper indicator 10% 10% 10% 10% 10% 10% 10% 10% 10% 10%
Net Financial Liabilities Ratio
Net Financial Liabilities Ratio 32.4% 1.4% (1.0)% (4.4)% (10.1)% (15.7)% (22.1)% (29.6)% (36.9)% (45.0)%
Local Govt Act upper indicator 60% 60% 60% 60% 60% 60% 60% 60% 60% 60%
Asset Sustainability Ratio
Asset Sustainability Ratio 31.9% 100.0% 96.9% 102.9% 99.1% 104.2% 99.2% 99.2% 102.0% 102.7%
Local Govt Act minimum indicator 90% 90% 90% 90% 90% 90% 90% 90% 90% 90%
Notes: Colour Within Moderate Outside
scale range range
Operating Surplus Ratio
This ratio measures the operating surplus achieved for the period and represents the operating
surplus / (deficit) as a percentage of operating revenue. A surplus will be represented by a positive
result.
As indicated above, Council should be aiming to achieve a balanced operating position. The
Council operating ratio of -6.49% is skewed by the one off cost of organisational restructure, and if
this is excluded from analysis, the ratio would be a positive 4.8%. Many councils across
Queensland undertook organisational restructures in 2013/14 to reduce their ongoing cost base
and our Council did the same. The ratio provides a baseline for Council against which future
performance will be measured.
Net Financial Liabilities Ratio
This ratio represents Council’s net financial liabilities (total liabilities less current assets) expressed
as a percentage of total operating revenue. The target range is less than 60%. A negative
percentage indicates that current assets exceed total liabilities, and is considered a very strong
position.
The position of 32.43% as at 30 June 2014 represents a strong outcome for Council and indicates
an inherent capacity to service higher levels of debt, though additional debt funding has not been
included in forward projections.
Asset Sustainability Ratio
This ratio is calculated by measuring the annual expenditure on the renewal and rehabilitation of
Council’s assets against the annual depreciation charge. It is a measure of whether Council is
reinvesting in existing infrastructure assets to hold them in optimal condition. The level of effort in
this area is driven by effective asset management plans, and for the first 6 months of operation the
focus has been on reviewing operations and establishing systems rather than on undertaking
extensive capital works expenditure. The capital works program inherited on 1 January 2014 from
the Sunshine Coast Regional Council for the Noosa area did not have sufficient projects focused
on the renewal of assets. This has been rectified by our Council when it developed its own capital
works program for 2014/15. Forward projections highlight Council’s commitment to ensuring
appropriate levels of investment in replacing community infrastructure.
Noosa Council Report 2014 Page 26 of 27
Section 29
Summary The financial period ended 30 June 2014 represents a solid financial result for Council, and provides a firm foundation for future operations. Ongoing innovation and a commitment to strong financial management will be necessary to ensure this position is maintained into the future. Noosa Council Report 2014 Page 27 of 27
Section 30
Appendix 1: Financial Statements 2013/14 Appendix 1: Financial Statements 2013/14
Section 31
? it
NOOSA SHIRE COUNCIL
Financial Statements
For the six months ending 30 June 2014
Table of contents
Note
Statement of Comprehensive Income
Statement of Financial Position
Statement of Changes in Equity
Statement of Cash Flows
Notes to the financial statements
1 Significant accounting policies
2 Analysis of results by function
3 Revenue analysis
4 Grants, subsidies, contributions and donations
5 Capital income
6 Gain (Joss) on the disposal of capital assets
7 Gain on restructure of local government
8 Employee benefits
9 Materials and services
10 Finance costs
H Depreciation and amortisation ,
12 Capital expenses
13 Loss on write-off of capital assets
14 Cash assets and cash equivalents
15 Trade and other receivables
16 Inventories
17 Equity investments
18 Property, plant and equipment
19 Fair value measurements
20 Intangible assets
21 Trade and other payables
22 Provisions
23 Borrowings
24 Other liabilities
25 Retained surplus
26 Commitments for expenditure
27 Events after balance date
28 Contingent liabilities
29 Superannuation
30 Trast funds
31 Reconciliation of net result for the year to net cash inflow (outflow) from operating activities
32 Operating lease income
33 Financial Instruments
34 National competition policy comprising:
Management Certificate
Independent Audit Report
Other financial statements
Current-year Financial Sustainability Statement
Long-Term Financial Sustainability Statement
PagelSection 32
a ‘
NOOSA SHIRE COUNCIL
Statement of Comprehensive Income
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
Income
Revenue
Recurrent revenue
Rates and charges 3 {a} 30,470,848 30,470,848
Sale of goods and major services 3 (b) 3,267,009 3,267,009
Fees and charges 3 {c) 2,162,005 2,162,005
Rental and levies 3 (d) 481,667 481,667
Interest received 3 (e) 2,520,125 2,520,125
Sales of contract and recoverable works 3 (f) 76,857 76,857
Other recurrent income 3 (g) 598,920 1,502,935
Grants, subsidies, contributions and donations 4 (i) 1,890,879 1,890,879
Total recurrent revenue 44,468,310 42,372,325
Capital revenue
Grants, subsidies, contributions and donations 4 (ii) 2,358,968 2,358,968
2,358,968 2,358,968
Total revenue 43,827,278 44,731,293
Capital income 5 7,228 7,228
Total income before gain on restucture of local government 2 43,834,506 44,738,521
Net gain on restructure of local govenrment 7 972,198,126 972,198,126
Total income 2 1,016,032,632 1,016,936,647
Expenses
Recurrent expenses
Employee benefits 8 (18,264,226) (18,264,226)
Materials and services 9 (16,755,448) (16,755,448)
Finance costs 10 (1,359,476) (1,359,476)
Depreciation and amortisation fl (7,779,655) (7,779,655)
Total recurrent expenses (44,158,806) (44,158,806)
Capital expenses
Other capital expenses 12 (315,945) (315,945)
Total expenses (44,474,751) (44,474,751)
Equity share of profit (loss) in investment in associate through participation rights 1,942,760 -
Net result 973,500,642 972,461,897
Total comprehensive income for the period 973,500,642 972,461,897
The above statement should be read in conjunction with the accompanying notes and Summary of Significant Accounting Policies.
certified statements
Page 2Section 33
' tt
NOOSA SHIRE COUNCIL
Statement of Financial Position
As at 30 June 2014 Consolidated Council]
2014 2014
Note $ $
Current Assets
Cash assets and cash equivatents 14 28,893,012 28,893,012
Trade and other receivables 15 (a) 18,806,278 18,806,278
Inventories 16 103,425 103,425
. 47,802,715 47,802,715
Non-current Assets
Trade and other receivables 15 (b) 49,217,517 49,217,517
Equity investments i7 62,016,970 60,978,225
Property, plant and equipment 18 (b) 873,447,519 873,447,519
Intangible assets 20 2,268,600 2,268,600
986,950,606 985,911,861
TOTAL ASSETS 1,034,753,321 1,033,714,576
Current Liabilities
Trade and other payables 21 6,669,789 6,669,789
Provisions 22 4,358,384 4,358,384
Borrowings 23 2,600,397 2,600,397
Other 24 831,140 831,140
: 14,459,710 14,459,710
Non-current Liabilities
Provisions 22 8,216,341 8,216,341
Borrowings 23 38,576,628 38,576,628
46,792,969 46,792,969
TOTAL LIABILITIES 61,252,679 61,252,679
NET COMMUNITY ASSETS 973,500,642 972,461,897
Community Equity
Retained surplus (deficiency) 25 973,500,642 972,461,897
TOTAL COMMUNITY EQUITY 973,500,642 972,461,897
The above statement should be read in conjunction with the accompanying notes and Summary of Significant Accounting Policies.
certified statements
Page 3Section 34
NOOSA SHIRE COUNCIL
Statement of Changes in Equity
For the six months ending 30 June 2014
Total Retained surplus
Council (deficit)
. Note Note 25
2014 . 2014
$ $
Balance at beginning of period - -
Net result |__| 972,461,897 | __ 972,461,897
Total comprehensive income for period | __—|__972,461,897 | _ 972,461,897
Transfers (to) from retained earnings
and capital reserves 25
Balance at end of period |___|_972,461,897 | _ 972,461,897
NOOSA SHIRE COUNCIL
Statement of Changes in Equity
For the six months ending 30 June 2014
Total Retained surplus
(deficit)
Consolidated Note Note 25
2034 2014
$ $
Balance at beginning of period : :
Net result |_| 973,500,642 973,500,642
Other comprehensive income for the period Pf fl
Total comprehensive income YS 973,500,642 973,500,642
Balance at end of period |_| 973,500,642 973,500,642 |
The above statement should be read in conjunction with the accompanying notes and Sunimary of Significant Accounting Policies.
QAO
. certified statements
Page 4Section 35
. ot
NOOSA SHIRE COUNCIL
Statement of Cash Flows
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
Cash flows from operating activities :
Receipts
Receipts from customers 36,376,779 36,376,779
Dividend received . -
Operating grants, subsidies and contributions 1,890,879 1,890,879
Income tax equivalent received 494,614 494,614
Interest received 2,520,125 2,520,125
Income from equity investments 904,015 904,015
Payments
Payments to suppliers and employees (37,024,927) (37,024,927)
Interest expense (130,469) (130,469)
Net cash inflow (outflow) from operating activities 32 5,031,016 5,031,016
Cash flows from investing activities:
State Government subsidies & grants 1,058,819 1,058,819
Capital contributions 1,300,149 1,360,149
Inter-entity balance with SCRC (1,021,691) (1,021,691)
Payments for property, plant and equipment (2,740,657) (2,740,657)
Payments for intangible assets (2,171,862) (2,171,862)
Proceeds from sale of property plant and equipment 6 10,155 10,155
Net cash inflow (outflow) from investing activities (3,565,087) (3,565,087)
Cash flows from financing activities:
Cash collected under an service level agreements 101,517 101,517
Proceeds from borrowings 23 2,300,000 2,300,000
Repayment of borrowings 23 {2,308,977} (2,308,977)
Net cash inflow (outflow) from financing activities 92,540 92,540
Net increase (decrease) in cash and cash equivalents held 1,558,468 1,558,468
Cash and cash equivalents transferred on de-amalgamation from SCRC 27,334,545 27,334,545
Cash and cash equivalents at end of the financial year t4 28,893,014 28,893,014
The above statement should be read in conjunction with the accompanying notes and Summary of Significant Accounting Policies.
-
: aa certified statements
PageSSection 36
4 oan
NOOSA SHIRE COUNCIL
Notes to the Financial Statements
For the six months ending 30 June 2014
1 Significant accounting policies
1,1 Basis of preparation
These general purpose financial statements are for the period | January 2014 to 30 June 2014 and have
been prepared in compliance with the requirements of the Local Government Act 2009 and the Local
Government Regulation 2012, Consequently, these financial statements have been prepared in
accordance with ail Australian Accounting Standards, Australian Accounting Interpretations and other
authoritative pronouncements issued by the Australian Accounting Standards Board.
These financial statements have been prepared under the historical cost convention except for the
Teyaluation of certain non-current assets.
1,2 Statement of compliance
These general purpose financial statements comply with all accounting standards and interpretations
issued by the Australian Accounting Standards Board (AASB) that are relevant to Council's operations
and effective for the current reporting period. Because the Council is a not-for-profit entity and the
Australian Accounting Standards include requirements for not-for-profit entities which are inconsistent
with Intemational Financial Reporting Standards (IFRS), to the extent these inconsistencies are
applied, these financial statements do not comply with IFRS.
The main impacts are the offsetting of revaluation and impairment gains and losses within a class of
assets, and the timing of the recognition of non-reciprocal grant revenue.
1.3 Basis of consolidation
(i) Associates
Associates are entities that Noosa Shire Council has significant influence over. Significant influence is
the power to participate in the financial, operating and policy decisions but does not constitute control
or joint control. Investments in associates are accounted for in the financial statements using the equity
method and are carried at the lower of cost and recoverable amount. Under this method, the
consolidated entity's share of post acquisition profits and losses of associates is recognised in the
Statement of Comprehensive Income and the interest in the equity of the associates is recognised in the
Statement of Financial Position. The cumutative post acquisition movements are adjusted against the
cost of the investment.
(ii) Other transactions with associates
Dividends
Dividends declared and paid are treated in accordance with the equity basis of accounting set out
Tax Equivalents
Unitywater operates under an income tax equivalent regime, with all tax paid being distributed to the
participating Councils on a pro-rata basis to their participation rights. Tax is payable quarterly based
on a percentage of the Unitywater gross revenue,
Participant loans
Participant loans provide for a fixed interest rate with quarterly interest only payments. Interest
payments are not eliminated as part of the equity accounting in associates disclosure. The amount of
the participant loan remains unchanged.
Council had an interest in one (1) associate during the year being Unitywater and is included in Note
1.17
1.4 Constitution
The Noosa Shire Council is constituted under the Queensland Local Government Act 2009 and is
domiciled in Australia.
1.5 Date of authorisation
The financial statements are authorised for issue on the date it was submitted to the Auditor-General
for final signature. This is the date the management certificate is signed.
1.6 Currency
The Councif uses the Australian dollar as its functional currency and its presentation currency.
OB: mee certified statements
Page 6Section 37
2 1
NOOSA SHIRE COUNCIL
Notes to the Financial Statements
For the six months ending 30 June 2014
1.7 Adoption of new and revised Accounting Standards
In the current year, Council adopted all of the new and revised Standards and Interpretations issued by
the Australian Accounting Standards Board (AASB) that are relevant to its operations and effective for
the current reporting period. The adoption of the new and revised Standards and Interpretations has
not resulted in any material changes to Council's accounting policies. However the Application of
AASB 13 Fair Value Measurement and AASB 2011-8 Amendments to Australian Accounting
Standards arising from AASB 13 for the first time this year has resulted in greater disclosures,
At the date of authorisation of the financial statements, the Standards and Interpretations listed below Effective for annual
were in issue but not yet effective. report periods
beginning on are
after:
AASB 9 Financial Instruments (December 2009) 1 January 2017
AASB 1055 Budgetary Reporting 1 July 2014
2009-11 Amendments to Australian Accounting Standards arising from AASB 9 (December 2009) 1 January 2015
AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 (December 2010) 1 January 2015
AASB 2013-1 Amendments to AASB 1049 - Relocation of Budgetary Reporting Requirements 1 July 2014
AASB 9 Financial Instruments (effective from 1 January 2015)
AASB 9, which replaces AASB 139 Financial Instruments: Recognition and Measurement , is effective
for reporting periods beginning on or after 1 January 2015 and must be applied retrospectively. The
main impact of AASB 9 is to change the requirements for the classification, measurement and
disclosures associated with financial assets.
Under the new requirements the four current categories of financial assets stipulated in AASB 139 will
be replaced with two measurement categories: fair value and amortised cost and financiai assets wilt
only be able to be measured at amortised cost where very specific conditions are met,
As a result, Council will be required to measure its financial assets at fair value.
AASB 12 contains the disclosure requirements for interests in other entities including unconsolidated
structured entities. While the Council is yet to complete a review of disclosure, no significant changes
are anticipated, based on those presently made.
1,8 Critical accounting judgements and key sources of estimation uncertainty
In the application of Council's accounting policies, management is required to make judgements,
estimates and assumptions about carrying values of assets and liabilities that are not readily apparent
from other sources. The estimates and associated assumptions are based on historical experience and
other factors that are considered to be relevant. Actual results may differ from these estimates. The
estimates and ongoing assumptions are reviewed on an ongoing basis. Revisions to accounting
estimates are recognised in the period in which the estimate is revised and in future periods as relevant.
Judgements, estimates and assumptions that have a potential significant effect are outlined in the
following financial statement notes:
Valuation and depreciation of property, plant and equipment - note 1.18 and note 19 Fair value
measurements
Impairment of property, plant and equipment - note 1.20 and note 18 (b)
Provisions - note 1.23 and note 22
Valuation of finance leases - note 1,21
Contingent liabilities - note 28
1,9 Revenue
Rates, levies, grants and other revenue are recognised as revenue on receipt of funds or earlier upon
unconditional entitlement to the funds.
1.9 (a) Rates and levies
Where rate monies are received prior to the commencement of the rating/levying period, the amount is
recognised as revenue in the period in which they are received, otherwise rates are recognised at the
commencement of rating period.
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Page 7Section 38
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NOOSA SHIRE COUNCIL
Notes to the Financial Statements
For the six months ending 30 June 2014
rt rarest,
1.9 (b) Grants and subsidies
Grants, subsidies and contributions that are non-reciprocal in nature are recognised as revenue in the
year in which Council obtains control over them.
1d © Non-cash contributions
Non-cash contributions including physical assets, in excess of $5,000 in value are recognised as
revenue and as non-current assets. Non-cash contributions below $5,000 are recorded as revenue and
expenses.
Physical assets contributed to Council by developers in the form of road works, stormwater, water and
wastewater infrastructure and park equipment are recognised as revenue when the development
becomes “on maintenance" (i.e. the Councif obtains control of the assets and becomes liable for any
ongoing maintenance) and there is sufficient data in the form of drawings and plans to determine the
approximate specifications and values of such assets. All non-cash contributions are recognised at the
fair value of the contribution received on the date of acquisition
1.9 (d) Cash contributions
Council receives cash contributions from property developers to construct assets such as roads and
footpaths, Where agreements between Council and the developers relating to these contributions are
determined to fall within the scope of AASB Interpretation 18 Transfers of Assets from Customers
these contributions are recognised as revenue when the related service obligations are fulfilled.
1.9 (e} Rental income
Rental revenue from investment and other property is recognised as income on a periodic straight line
basis over the lease term.
19 6 Interest and dividends
Interest received from term deposits is accrued over the term of the investment. Dividends are
recognised once they are formally declared by the directors of the associated entity,
1.9 (g) Sales revenue
Sale of goods is recognised when the the significant risks and rewards of ownership are transferred to
the buyer, generally when the customer has taken undisputed delivery of the goods.
The council generates revenues from a number of services. Revenue from contracts and recoverable
works generally comprises a recoupment of material costs together with an hourly charge for use of
equipment and employees. Contract revenue and associated costs are recognised by reference to the
stage of completion of the contract activity at the reporting date. Revenue is measured at the fair value
of consideration received or receivabie in relation to that activity. Where consideration is received for
the service in advance it is included in other liabilities and is recognised as revenue in the period when
the service is performed.
1.9 = (h) Fees and Charges
Fees and charges are recognised upon unconditional entitlement to the funds. Generally this is upon
lodgement of the relevant applications or documents, issuing of the infringement notice or when the
service is provided.
1,10 Financial assets and liabilities
Council recognises a financial asset or a financial liability in its Statement of Financial Position when,
and only when, Council becomes a party to the contractual provisions of the instrument.
Noosa Shire Council has categorised and measured the financial assets and financial liabilities held at
balance date as follows:
Financial assets
Cash and cash equivalents (note 1.11)
Receivables - measured at amortised cost less any impairment (note 1.12)
Other financial assets (finance leases) - measured at fair value (note 1.21)
Financial liabilities
Payables - measured at amortised cost (note 1,22}
Borrowings - measured at amortised cost (note 1.24)
Financial assets and financial liabilities are presented separately from each other and offsetting has not
been applied.
All other disclosures relating to the measurement and financial risk management of financial
instruments are included in note 33.
certified statements
Page 8Section 39
, NOOSA SHIRE COUNCIL
Notes to the Financial Statements
For the six months ending 30 June 2014
1.11 Cash and cash equivalents
Cash and cash equivalents includes cash on hand, all cash and cheques receipted but not banked at the
year end, deposits held at call with financial institutions, other short-term, highly liquid investments
with original maturities of three months or less that are readily convertible to known amounts of cash
and which are subject to an insignificant risk of changes in value, and bank overdrafts.
1,12 Receivables
Trade receivables are recognised at the amounts due at the time of sale or service delivery i.e. the
agreed purchase price / contract price. Settlement of these amounts is required within 30 days from
invoice date.
The collectability of receivables is assessed periodically and if there is objective evidence that Council
will not be able to collect al! amounts due, the carrying amount is reduced for impairment. The loss is
recognised in finance costs. The amount of the impairment is the difference between the asset’s
carrying amount and the present value of the estimated cash flows discounted at the effective interest
rate.
Ali known bad debts were written-off at 30 June. Subsequent recoveries of amounts previously written
off in the same period are recognised as finance costs in the Statement of Comprehensive Income. If
an amount is recovered in a subsequent period it is recognised as revenue.
Because Council is empowered under the provisions of the Lecal Government Act 2009 to seil an
owner's property to recover outstanding rate debts, Council does not impair any rate receivables.
Loans and advances are recognised in the same way as other receivables. Terns are usually a
maximum of five years with interest charged at negotiated rates. Security is not normally obtained.
1,13 Inventories
Stores and raw materials held for resale are valued at the lower of cost and net realisable value and
include, where applicable, direct material, direct labour and an appropriate portion of variable and
fixed overheads. Costs are assigned on the basis of weighted average cost.
Inventories held for distribution (internal consumption) are:
* goods to be supplied at no, or nominal, charge, and
* goods to be used for the provision of services at no, or nominal, charge.
Inventory for distribution is valued at cost, adjusted when applicable for any loss of service potential.
Land acquired by Council with the intention of reselling it (with or without further development) is
classified as inventory. This land is valued at the lower of cost or net realisable value. As an inventory
item, this land held for resale is treated as a current asset. Proceeds from the sale of this land will be
recognised as sales revenue on the signing of a valid unconditional contract of sale.
1,14 Other financial assets
Other financial assets are recognised at cost.
1,15 Non current assets held for sale
Items of property, plant and equipment are reclassified as non-current assets as held for sale when the
carrying amount of these assets will be recovered principally through a sales transaction rather than
continuing use. Non-current assets classified as held for sale are available for immediate sale in their
present condition and management believe the sale is highly probable. Non-current assets held for sale
are measured at the lower of their carrying amount and fair value less cost to sell and are not
depreciated. On the eventual sale of these assets a gain or loss is recognised.
1,16 Investments
Term deposits in excess of three months are reported as investments, with deposits of less than three
months being reported as cash equivalents.
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NOOSA SHIRE COUNCIL
Notes to the Financial Statements
For the six months ending 30 June 2014
1.37 Investment in associate
As at 1 July 2010 a water distribution and retail business called Unitywater was established in
accordance with the South-East Queensland Water (Distribution and Retail Restructuring} Act 2009
to deliver water and waste water services to customers within the local government areas of Moreton
Bay Regional Council, Sunshine Coast Regional Council and the now de-amalgamated Noosa Shire
Council.
Under the Act, governannce arrangements for Unitywater were established in a Participation
Agreement which commenced from | July 2010. The agreement provides for participation rights to be
held by the participating Councils. The participating Councils are Noosa Council, Moreton Bay
Regional Council and the Sunshine Coast Regional Council. The Participation Rights effectively
represent an investment in an associate by Noosa Shire Council and are disclosed in Note 17.
Associates are entities over which Noosa Shire Council exerts significant influence, Significant
influence is the power to particpate in the financial and operating policy decisions but is not control or
joint control. Council has determined that Unitywater is an associate for accounting disclosure
purposes.
Investments in associates are accounted for in ihe financial statements using the equity method and are
carried the lower of cost and recoverable amount. Under this method, the entity's share of post
acquisition profits or losses of associates is recognised in the Statement of Comprehensive Income and
the interest in the equity of the associate is recognised in the Statement of Financial Position. The
cumulative post-acquisition movements, being the share of profits less dividends received and accrued,
are adjusted against the cost of the investment.
1,18 Property, plant and equipment
Each class of property, plant and equipment is carried at cost or fair value less, where applicable, any
accumulated depreciation and accumulated impairment losses. Items of property, plant and equipment
with a total value of less than $5,000, except for land and network assets (which have a recognition
threshold of $1), are treated as an expense in the year of acquisition. Ali other items of property, plant
and equipment are capitalised.
The classes of property plant and equipment recognised by the council are reported in note 18 (b).
{a) Acquisition of assets
Acquisitions of assets are initially recorded ai cost. Cost is determined as the fair value of the assets
given as consideration plus costs incidental to the acquisition, including freight in, architect's fees and
engineering design fees and all other establishment costs.
Property, plant and equipment received in the form of contributions, are recognised as assets and
revenues at fair value by Council valuation where that value exceeds the recognition thresholds for the
respective asset class. Fair value is the price that would be received to sell the asset in an orderly
transaction between market participants at the measurement date. Assets transferred from Sunshine
Coast Regional Council (SCRC) have been initially recognised at their fair value in the SCRC books
immediately before the transfer. These were subsequently revalued in accordance with Note 1.18 (c) .
(b) Capital and operating expenditure
Wage and materials expenditure incurred for the acquisition or construction of assets are treated as
capital expenditure. Routine operating maintenance, repair costs and minor renewals to maintain the
operational capacity of the non-current asset is expensed as incurred, while expenditure that relates to
replacement of a major component of an asset to maintain its service potential is capitalised.
(c) Valuation
Land, buildings, infrastructure and heritage and cultural assets are measured on the revaluation basis, at
fair value, in accordance with AASBI16 Property, Plant and Equipment and AASB 13 Fair Value
Measurement . The fair values mean the price that would be received to sell an asset or paid to transfer
a liability in an orderly transaction between market participants at the measurement date.
Non-current physical assets measured at fair value are revalued, where required, so that the carrying
amount of each class of asset does not materially differ from its fair value at the reporting date. This is
achieved by engaging independent, professionally qualified valuers to determine the fair value for each
class of property, plant and equipment assets at least once every 3 years. This process involves the
valuer physically sighting a representative sample of Council assets across all asset classes and making
their own assessments of the condition of the assets at the date of inspection.
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Notes to the Financial Statements
For the six months ending 30 June 2014
Council uses internal engineers to assess the condition and cost assumptions associated with all
infrastructure assets, the results of which are considered in combination with the relevant indices
independently published for the Sunshine Coast Region. Together these are used to form the basis of a
management valuation for infrastructure asset classes in each of the intervening years. With respect to
the valuation of the land and improvements, and buildings classes in the intervening years,
management engage independent, professionally qualified valuers to perform a "desktop" valuation. A
desktop valuation involves management providing updated information to the valuer regarding
additions, deletions and changes in assumptions such as useful life, residual value and condition rating.
The valuer then determines suitable indices which are applied to each of these asset classes.
On revaluation, accumulated depreciation is restated proportionately with the change in the carrying
amount of the asset and any change in the estimate of remaining useful life.
Separately identified components of assets are measured on the same basis as the assets to which they
relate.
(d) Capital work in progress
The cost of property, plant and equipment being constructed by the Council includes the cost of
purchased services, materials, direct labour and an appropriate proportion of labour overheads.
{e) Depreciation
Land is not depreciated as it has an unlimited useful life. Depreciation on other property, plant and
equipment assets is calculated on a straight-line basis so as to write-off the net cost or revalued amount
of each depreciable asset, less its estimated residual value, progressively over its estimated useful life
to the Council. Management believe that the straight-line basis appropriately reflects the pattern of
consumption of all Council assets.
Assets are depreciated from the date of acquisition or, in respect of internally constructed assets, from
the time an asset is completed and commissioned ready for use.
Where assets have separately identifiable components that are subject to regular replacement, these
components are assigned useful lives distinct from the asset to which they relate. Any expenditure that
increases the originally assessed capacity or service potential of an asset is capitalised and the new
depreciable amount is depreciated over the remaining useful life of the asset to the Council.
Major spares purchased specifically for particular assets that are above the asset recognition threshold
are capitalised and depreciated on the same basis as the asset to which they relate.
The depreciable amount of improvements to or on leasehold land is allocated progressively over the
estimated useful lives of the improvements to the Council or the unexpired period of the lease,
whichever is the shorter.
Depreciation methods, estimated useful lives and residual values of property, plant and equipment
assets are reviewed at the end of each reporting period and adjusted where necessary to reflect any
changes in the pattern of consumption, physical wear and tear, technical or commercial obsolescence,
or management intentions. The condition assessments performed as part of the annual valuation
process for assets measured at depreciated current replacement cost are used to estimate the useful
lives of these assets at each reporting date.
Details of the range of estimated useful lives for each class of asset are shown in note 18 (b).
iC) Land under roads
Land under roads acquired before 30 June 2008 is recognised as a non-current asset where the Council
holds title or a financial lease over the asset. The Noosa Shire Council currently does not have any
such land holdings.
Land under the road network within the Council area that has been dedicated and opened for public use
under the Land Act 1994 or the Land Title Act 1994 is not controlled by council but is controlled by
the state pursuant to the relevant legislation. Therefore this land is not recognised in these financial
Statements,
1,19 Intangible Assets
Intangible assets with a cost or other value exceeding $5,000 are recognised as intangible assets in the
financial statements, items with a lesser value being expensed.
Expenditure on research activities relating to internatly-generated intangible assets is recognised as an
expense in the period in which it is incurred.
Costs associated with the development and procurement of computer software are capitalised and are
amortised on a straight-line basis over the period of expected benefit to Council.
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NOOSA SHIRE COUNCIL
Notes to the Financial Statements
For the six months ending 30 June 2014
Amortisation methods, estimated useful lives and residual values are reviewed at the end of each
reporting period and adjusted where appropriate. Details of the estimated useful lives assigned to each
class of intangible assets are shown in note 20.
1,20 impairment of non current assets
Each nen-current physical and intangible asset and group of assets is assessed for indicators of
impairment annually. [fan indicator of possible impairment exists, the Council determines the asset's
recoverable amount. Any amount by which the asset's carrying amount exceeds the recoverable
amount is recorded as an impairment Joss. The recoverable amount of an asset is the higher of its fair
value less costs to sell and its value in use,
An impairment loss is recognised immediately in the Statement of Comprehensive Income, unless the
asset is carried at a revalued amount. When the asset is measured at a revalued amount, the
impairment loss is offset against the asset revaluation surplus of the relevant class to the extent
available.
Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the
revised estimate ofits recoverable amount, but so that the increased carrying amount does not exceed
the carrying amount that would have been determined had no impairment loss been recognised for the
asset in prior years. A reversal of an impairment loss is recognised as income unless the asset is
carried at a revalued amount, in which case the reversal of the impairment loss is treated as a
revaluation surplus increase.
1,21 Leases
Leases of plant and equipment under which the Council as lessee/lessor assumes/transfers substantially
all the risks and benefits incidental to the ownership of ihe asset, but not the legal ownership, are
classified as finance leases. Other leases, where substantially all the risks and benefits remain with the
lessor, are classified as operating leases.
The council has no finance leases.
Operating leases
Payments made under operating leases are expensed in equal instalments over the accounting periods
covered by the lease term, except where an alternative basis is more representative of the pattern of
benefits to be derived from the leased property.
1, 22 Payables
Trade creditors are recognised upon receipt of the goods or services ordered and are measured at the
agreed purchase/contract price net of applicable discounts other than contingent discounts. Amounts
owing are unsecured and are generally setiled on 30 day terms.
1, 23 Liabilities - employee benefits
Liabilities are recognised for employee benefits such as wages and salaries, annual leave and long
service leave in respect of services provided by the employees up to the reporting date. Liabilities for
employee benefits are assessed at each reporting date.
{a} Salaries and wages
A liability for salaries and wages is recognised and measured as the amount unpaid at the reporting
date at current pay rates in respect of employees' services up to that date. This liability represents an
accrued expense and is included in note 21 as a payable.
(b} Annual leaye
A liability for annual leave is recognised. As Council] does not have an unconditional right to defer
settlement of the annual leave beyond the !2 months after the reporting date, annual leave is classified
as current, and calculated based on projected future wage and salary levels and related employee on-
costs, and discounted to present values. This is currently disclosed in Note 21 as a payable.
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Notes to the Financial Statements
For the six months ending 30 June 2014
(c} Sick leave
Sick leave taken in the future will be met by future entitlements and hence no recognition of accrued
sick leave entitlements have been made in these financial statements. No entitlement vests with the
employee on termination.
{d) Superannuation
The superannuation expense for the reporting period is the amount of the contribution the Council
makes to the superannuation plan which provides benefits to its employees.
Details of those arrangements are set out in note 29.
(e) Long service leave
A liability for long service leave 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 ar¢ 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
eamed to date, and the result is discounted to present value. The interest rates atlaching to
Commonwealth Government guaranteed securities at the reporting date are used to discount the
estimated future cash outflows to their present value.
This liability is reported in note 22 as a provision.
1, 24 Borrowings
Loans payable are measured at amortised cost using the effective interest rate method. The effective
interest rate is the rate that exactly discounts estimated future cash payments or receipts through the
expected life of the financial instrument. Borrowing costs, which includes interest calculated using the
effective interest method and administration fees, are expensed in the period in which they arise. Costs
that are not settled in the period in which they arise are added to the carrying amount of the borrowing.
In accordance with the Local Government Regulation 2012 Council adopts an annual debt policy that
sets out Council's planned borrowings for the next nine years. Council's current policy is to only
borrow for capital projects and for a term no longer than the expected life of the asset. Council also
aims to comply with the Queensland Treasury Corporation's borrowing guidelines and ensure that
sustainability indicators remain within acceptable levels at all times. Council has also established a
working capital loan facility to fund de-amalgamation expenditure incurred before 31 December 2013.
This facility will be fiully paid by 30 June 2015.
All borrowing costs are expensed in the period in which they are incurred. No borrowing costs are
capitalised on qualifying assets.
Borrowings are classified as current liabilities unless Council has an unconditional right to defer .
settlement of the liability for at least 12 months after the balance date.
1,25 Restoration provision
A provision is made for the cost of rehabiliation 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.
The provision is measured at the expected cost of the work required discounted to current day values
using an appropriate rate, The current capital market yield bond rate is considered an appropriate rate
with a maturity date corresponding to the anticipated date of restoration.
Council has the following restoration provisions:
(a) Landfill sites
The provision represents the present value of the anticipated future costs associated with the closure of
the Eumundi Rd landfill site, 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
tesuli 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 landiill site 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 2054 and that site restoration will occur progressively over the subsequent thirty years.
(b) 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.
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Notes to the Financial Statements
For the six months ending 30 June 2014
a er sis
The calculation of this provision requires assumptions such as application of environmental legislation,
sile 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.
1, 26 Asset revaluation surplus
The asset revaluation surplus comprises adjustments relating to changes in value of property, plant and
equipment that do not result from the use of those assets. Net incremental changes in the carrying
value of classes of non-current assets since their initial recognition are accumulated in the asset
revaluation surplus.
Increases and decreases on revaluation are offset within a class of assets.
Where a class of assets is decreased on revaluation, that decrease is offset first against the amount
remaining in the asset revaluation surplus in respect of that class. Any excess is treated as an expense.
When an asset is disposed of, the amount reported in surplus in respect of that asset is retained in the
assel revaluation surplus and not transferred to retained surplus.
1,27 Retained surplus (deficit)
This represents the amount of Council’s net funds not set aside in reserves to meet specific future
needs,
1,28 National competition pelicy
The Council has reviewed its activities and has identified 2 activities that are business activities.
Details of these activities can be found in note 34.
1, 29 Rounding and comparatives
The financial statements have been rounded to ihe nearest $1.
1.30 Trust funds held for outside parties
Funds held in the trust account on behalf of outside parties include those funds from the sale of land
for arrears in rates, deposits for the contracted sale of land, security deposits lodged to guarantee
performance and unclaimed monies (e.g. wages) paid into the trust account by the Council, The
Council performs only a custodian role in respect of these monies and because the monies cannot be
used for Council purposes, they are nol considered revenue nor brought to account in the financial
statements.
1.31 Taxation
Income of local authorities and public authorities is exempt from Commonwealth taxation except for
Fringe Benefits Tax and Goods and Services Tax (‘GST’). The net amount of GST recoverable from
the Australian Taxation Office (ATO) or payable to the ATO is shown as an asset or liability
respectively. The Council pays payroll tax to the Queensland Government on certain activities.
Unitywater pays Council an income 1ax equivalent in accordance with the requirements of the Local
Gavernment Act 2009 . Where the activity of such an entity is subject to the tax equivalents regime, the
income tax expense is calculated on the operating surplus adjusted for permanent differences between
taxable and accounting income. These transactions are eliminated upon consolidation.
certified staternents
Page 14Section 45
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
2 (a) Components of council functions
‘The activities relating to the Council's components reported on in Note 2 (b) are as follows :
CEO
Comprises the office of the CEO and Council’s internal audit function.
Community Services
Comprises community development, community facilities, disaster management, environmental health, libraries and galleries, public order,
sport and recreation, and waste management.
Planning and Infrastructure
Comprises building and plumbing assessment and services, development assessment and planning, environmental policy and operations,
strategic land use planning, asset design, asset planning, civil works and maintenance, parks and gardens and natural areas.
Executive Office
Comprises community engagement, customer service, economic development, executive support, governance, and internal human
resources.
Corporate Services
Comprises Council financial services, information communication technology services, procurement and fleet, property and facilities, and
revenue services.
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Page 15Section 46
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
2 Analysis of results by function
(b) Revenue before gain on restructure, expenses and assets have been aftributed to the following functions :
Functions Total Total Net Assets
Grants Other income expenses result
for period
2014 2014 2014 2014 2014 2014
$ § $ $ $ S
co ids 12,000 12,000 293,008 asiooal
1,301,192 8,024,065] 9,325,257] 11,303,403 | __(1,978,146) 518,280
Planning and Infrastructure 1,038,819 2,748,611] 3,787,430 | ‘16,272,444 | (12,485,014)
Executive Office | | niga 964] 2,194,964 2,864,360 (669,396)
589,024] __ 28,829,846] 29,418,870 | 13,741,535 | _ 15,677,335 | _1,033,110,845
Total Council 2,929,035] __41,809.486| 44,738,521] 44,474,750 263,771] 1,033,714,576
Controlled entity net of eliminations | ss - | 103,745] o3n.74s] Ys 8,7485 1,038,745
2,929,035| 42,848,231] 45,777,266| __ 44,474,750] __1,302,516| __1,034,753,321
wo ~ QAO
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Page 16Section 47
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
3 Revenue analysis
(a) Rates and charges 1.9(a)
General rates 23,340,488 23,340,488
Separate rates 2,527,651 2,527,651
Special rates 839,351 839,351
Waste utility charges 5,015,495 5,015,495
Rates and utility charge revenue 31,722,985 31,722,985
Less: Discounts (889,269) (889,269)
Less: Pensioner remissions (362,869) (362,869)
Net rates and utility charges 30,470,848 30,470,848
(b) Saie of goods and major services
Sale of recyclables 283,825 283,825
Refuse tips and transfer station charges 836,367 836,367
Venue hire 191,774 191,774
Retail shop sales 64,115 64,115
Holiday parks fees and charges 1,315,057 1,315,057
Learn to swim 250,150 250,150
Admission fees 325,722 325,722
3,267,009 3,267,009
{c) Fees and charges
Building and development fees 924,707 924,707
Permits and licences 96,365 96,365
Fines and penalties 46,289 46,289
Registration fees 11,331 11,331
Parking penalties 215,726 215,726
Other statutory fees 205,896 205,896
User fees and charges 661,691 661,691
2,162,005 2,162,005
(d) Rental and levies
Other property lease income 481,667 481,667
_ 481,667, 481,667
(e) Interest received
Investments 958,097 958,097
Loan to Unitywater 1,323,951 1,323,951
Over due rates and utility charges 238,077 238,077
‘ 2,520,125 2,520,125
(f) Sales of contract and recoverable works
Revenue 76,857 76,857
76,857 76,857
The amount recognised as revenue from contract works during the period is the
amount receivable in respect of invoices issued during the period.
There are no contracts in progress at the period end.
The contract work carried out is not subject to retentions.
(g) Other recurrent income
Unitywater income tax equivalent received 494,614 494,614
Unitywater dividend received - 904,015
Other income 104,306 104,306
598,920 1,502,935
Oe
certified statements
. Page 17Section 48
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
4 Grants, subsidies, contributions and donations 1.9(b)
{i} Recurrent - grants, subsidies, contributions
and donations are analysed as follows:
General purpose grants 585,331 $85,331
Commonwealth subsidies and grants 899,430 899,430
State Government subsidies & grants 385,455 385,455
Donations 20,663 20,663
Total recurrent revenue 1,890,879 1,890,879
(ii) Capital - grants, subsidies, and contributions
are analysed as follows:
Monetary revenue constrained for capital purposes:
State Government subsidies & grants 251,000 251,000
NDRRA flood grants 807,819 807,819
Contributions 1,300,149 1,300,149
Total capital revenue 2,358,968 2,358,968
5 Capital income ,
Gain on the sale of capital assets 6 7,228 7,228
7,228 7,228
6 Gain (loss) on the disposal of capital assets
Proceeds from the sale of plant and equipment 10,155 10,155
Less: Book value of plant and equipment sold (2,927) (2,927)
7,228 7,228
Total gain (loss) on the disposal of capital assets 5 7,228
7 Gain on restructure of local government
(a) Net result attributable to Council before net assets transferred from de-amalgamated Council
Net result attributable to Council 973,500,642 972,461,897
Less:
Net gain on restructure of local government 7(b) 972,198,126 972,198,126
Net result before gain on restructure of local government 1,302,516 263,771
(b) Adjustments due to accounting policy alignment
Total assets and liabilities transferred to Noosa Council 1,039,086,966 1,039,086,966
Opening balance adjustments by Noosa Council (66,888,840) (66,888,840)
972,198,126 972,198,126
ec hapten — QAO
weet certified statements
Page 18Section 49
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
7 (c) Net gain on assets transferred from deamalgamated council
On the 11th April 2013 legislation was enacted to separate the former Noosa Shire Council from the Sunshine Coast Regional Council (SCRC).
Noosa Council has ‘been established with its former boundaries and includes an area of approximately 869 square kilometeres and a population of
51,962. (2006 census).
In accordance with AASB 3 Business Combinations , the net amount of all assets and liabilities transferred from Sunshine Coast Regional Council
has been recognised as a gain on the restructure of local government.
In some cases, adjustments have been made as a result of changes to accounting policy and the measurement of assets and liabilities signed off by
the Transfer Committee.
Details are as follows:
Book value Adjustments by Net Gain on
transferred Noosa Shire restructure of
from SCRC Council focal government
Assets Note $
Current assets
Cash and cash equivalents 39,044,123 - 39,044,123
Trade receivables (a) 3,390,546 1,135 3,391,681
Inventory 109,115 - 109,115
42,543,784 1,135 42,544,919
Non-current assets
Receivables (b) 49,233,190 (15,673) 49,217,517
Participation rights - Unitywater (b) 60,997,643 (19,418) 60,978,225
Property, plant and equipment (c) 940,218,634 (61,434,755) 878,783,879
Intangible assets 118,247 118,247
1,050,567,714 (61,469,846) _ 989,097,868
Total assets 1,093,111,498 (61,468,711) _1,031,642,787
Liabilities
Current liabilities
Trade payables 3,001,192 - 3,001,192
Provisions 5,751,090 - 5,751,090
Other (d) 576,052 69,168 645,220
9,328,334 69,168 9,397,502
Non-current liabilities
Borrowings 40,048,048 40,048,048
Provisions {e) 4,648,150 3,120,919 7,769,069
44,696,198 3,120,919 47,817,117
Total liabilities 54,024,532 3,190,087 57,214,619
De-amalalgamation expenses capitalised (f) - 2,230,042 2,230,042
Net gain on restructure of local government 1,039,086,966 (66,888,840) 972,198,126
Details of adjustments to opening balances
(a) Details of adjustments to opening balances for receivables
Trade and other receivables 1,135
Total adjustment 1,135
An adjustment was made to the opening balance for Regulatory Management receivables to align the migrated data with balances transferred.
(b) Detail of adjustments to opening balances for investment in associate
Unitywater loan receivable (15,673)
Unitywater participation righis (19,418)
Total adjustment (35,091)
QAO
Page 19 certified statementsSection 50
Opening balance adjustments were required as the amounts approved via the transfer committee varied to the formal subordinate
debt and participation agreements.
(c) Detail of adjustments to opening balances for property, plant and equipment
Correction to opening balances due to asset register irregularities
Operating expenditure contained within work in progress (2,241,057)
Assets not previously recognised 212,365
Assets previously recognised incorrectly (3,200,292)
Revaluation of assets to fair value
Revaiuation adjustment to asset values 107,747,005
Revaluation adjustment to accumulated depreciation (163,952,776)
Total adjustments to property, plant and equipment (61,434,755)
As part of the due diligence process involved in the transfer of assets, a reconcilation process was undertaken between the migrated source data and
the balance signed off by the transfer committee. This reconciliation identified a number of asset records that had either been incorrectly recognised
or physically disposed of and not reflected in the asset system.
Normal business processes were undertaken to capitalise completed projects and to remove expenditure that did not comply with asset recognition
critieria and thresholds.
The process also encompassed identification of disposals and write offs of assets invloved in the capitalisation of completed assets.
As part of the de-amalgamation process a revaluation of the major asset classes transferred from Sunshine Coast Regional Council was undertaken
to ensure fair value is recognised.
The fair values disclosed through the revaluation process represent the true value of the of the assets transferred as at | January 2014 and an
adjustment has been made to the opening balances for property, plant and equipment to recognise this change.
(d) Detail of opening balance adjustment for Other Liabilities
Other liabillities 69,168
Total adjustment 69,168
Opening balance adjustments were required as the amounts approved via the transfer committee varied to the susbsidiary systems migrated.
The scope of adjustments encompassed Cemetery Registers and Caravan Parks uneamed revenue.
(e} Detail of opening balance adjustment for landfill rehabilitation provision
Restatement of Jandfill rehabilitation provision 3,120,919
Total adjustment 3,120,919
Adjustments were made to the opening balance of the landfill rehabilitation provision after a formal review by extemal consultants ATC Williains
was undertaken.
The review faciliated a more accurate estimate of the Eumundi Road Jandfill's current cells used and unused capacity and expected future capping
outlay's as at | January 2014.
(f) Detail of opening balance adjustment for working capital loan
Value of QTC de-amalgamation loan capital facility transferred 2,230,042
Total adjustment 2,230,042
As Sunshine Coast Regional Council had removed the impact of the de-amalgamation costs from their statements prepared as at 31 December
2013 there is a requirement that the opening balances for the Noosa Council be adjusted to recognise the Queensland Treasury Corporation
working capital facility.
This adjustment represents the operational de-amalgamation expenditures incurred by Sunshine Coast Regional Council to 31 December 2013 and
have been absorbed against the reported gain on restructure of local government. .
~ QAO
certified statements
. Page 20Section 51
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
. 2014 2014
Nate $ $
8 Employee benefits
Recurrent
Total staff wages and salaries 10,327,289 10,327,289
Councillors’ remuneration 239,088 239,088
Annual, sick and long service leave entitlements 1,722,269 1,722,269
Superannuation 29 1,305,459 1,305,459
13,594,105 13,594,105
Other employee related expenses 304,129 304,129
13,898,234 13,898,234
Less: Capitalised employee expenses (461,711) (461,711)
13,436,523 13,436,523
Non- recurring
Staff redundancies 4,787 416 4,787,416
4,787,416 4,787,416
Other employee related expenses 40,287 40,287
4,827,703 4,827,703
18,264,226 «18,264,226
Councillor remuneration represents salary, and other allowances paid in respect of
carrying out their duties.
Total Council employees at June 2014: 2014 2014
Elected members 7 7
Administration staff 234 234
Depot and outdoors staff 95 95
Total full time equivalent employees 336 336
9 Materials and services
Audit services 90,000 90,000
Administration Supplies and Consumables 378,821 378,821
Legal expenses 744,335 744,335
Insurance 29,635 29,635
Communications and IT 336,586 336,586
Consultancy Services 201,954 201,954
Contract Services 9,060,491 9,060,491
Donations and Prizes 1,291,063 1,291,063
Electricity 884,462 884,462
Grants Paid to Community Organisations 34,340 34,340
Software and Maintenance 306,483 306,483
Commission Paid 246,839 246,839
Water and Sewerage Costs 341,748 341,748
Fleet Operating Costs 734,411 734,411
Other Materials and Services 1,600,489 1,600,489
Rentals - Operating leases 518,509 518,509
Less Capitalised Internal Expenses (44,719) (44,719)
16,755,448 16,755,448
10 Finance costs
Finance costs charged by the Queensland Treasury Corporation 1,268,423 1,268,423
Bank charges 89,013 89,013
Impairment of receivables and bad debts written off 909 909
Other finance costs 1,13] 1,131
1,359,476 1,359,476
certified statements
Page 21Section 52
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
11 Depreciation and amortisation 1.18(e)
(a) Depreciation of non-current assets
Buildings 749,306 749,306
Piant and Equipment . 244,723 244,723
Road and Bridge Network 4,462,163 4,462,163
Storm Water OLE,182 911,182
Other Infrastructure Assets 1,390,772 1,390,772
7,758,146 7,758,146
{b) Amortisation of other intangible assets
Computer Software 21,509 21,509
21,509 21,509
Total depreciation and amortisation 7,779 655 7,779,655
12 Capital expenses
Loss on write-off of capital assets 13 315,945 315,945
Total capital expenses 315,945 315,945
13 Loss on write-off of capital assets are as follows:
Plant and Equipment 6,421 6,421
Road and Bridge Network 209,094 209,094
Storm Water 16,059 16,059
Other Infrastructure Assets 84,371 84,371
12 315,945 315,945
14 Cash assets and cash equivalents 1.11
Cash at bank and on hand 77,994 77,994
Deposits at call 31,045,060 31,045,060
Less QTC working capital foan facility (2,230,042) (2,230,042)
Total cash and cash equivalents per cash flow statement ___ 28,893,012 28,893,012
Councils cash and cash equivalents are subject to a number of internal and external restrictions that limit amounts available for
discretionary or future use. These include:
Externally imposed expenditure restrictions at the reporting date relate to the following assets:
Unspent loan monies 128,138 128,138
Unspent government grants and subsidies 38,926 38,926
Internally imposed expenditure restrictions at the reporting date relate to the following assets:
Future capital works 3,037,105 3,037,105
Future asset replacement 573,182 573,182
Future constrained works 7,596,659 7,596,659
Future recurrent expenditure 9,259,193 9,259,193
Total unspent restricted cash held in reserves 20,633,203 20,633,203
Cash and deposits at call are held in the Commonwealth Bank in a normal business
cheque account. On call accounts are also held with QTC.
Deposits at call earned fixed interest over varying terms at interest rates of between
2.95% and 3.35%.
: ~ QAO
certified statements
Page 22Section 53
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
15 Trade and other receivables 1.12
(a) Current
Rateable revenue and utility charges 4,159,585 4,159,585
Fees and charges 1,016,774 1,016,774
GST recoverable 339,407 339,407
Other debtors - -
Inter-entity balance with SCRC 10,501,227 10,501,227
16,016,993 16,016,993
Prepayments 411,901 411,901
Accrued Revenue 2,377,385 2,377,385
18,806,279 18,806,279
(b) Non-current
Loans and advances to associates 1.16 49,217,517 49,217,517
49,217,517 49,217,517
Interest is charged on outstanding rates at a rate of 11% per annum. No interest is
charged on other debtors. There is no concentration of credit risk for rates and utility
charges, fees and other debtors receivable.
16 Inventories 1.13
Current
Inventories for internal use:
Stores and materials 63,875 63,875
Cultural and Recreational Facilities 39,550 39,550
103,435 108,425
Valued at cost, adjusted when applicable for any loss of service potential.
17 Equity investments
Investment in associate through participation rights 62,016,970 60,978,225
62,016,970 60,978,225
Reconciliation of the carrying amount at the beginning and end
of the current and previous period is set out below:
Investment in associate through participation rights
Equity investment in associate - Unity Water transferred from SCRC 60,997,643 60,997,643
Recognition of equity share of profit (loss) in the result for the period 1,942,760 -
Less distributions paid/payable to Council (904,015) -
Accounting adjustment on de-amalgamation Hc) (19,418) (19,418)
Fair value at end of financial year 62,016,970 60,978,225
certified statements
Page 23Section 54
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 reer
18 Council property, plant and equipment = eS | SE
Note Land Buildings Plant and Equipment} Road and Bridge Storm Water Other Infrastructure 7 Works in progress Total
Basis of measurement [Valuation | Valuation | ___—Cost_ | _‘ Valuation ‘| —Valuation [Valuation [Cost |
2014 2014 2014 2014 2014 2014 2014 2014
Asset Values $ $ $ $ $ $ $ $
Assets transferred from de-amalgamated council 159,859.939 60,480,551 7,397,557 550,252,152 104,064,222 54,709,289 3,454,924 940,218,634
Valuation adjustment on de-amalgamation He} (38,979,941) 14.015,208 - 64,818,214 21,284,899 (2,241,057) 102,577,950
Additions at cost 50,201 83,376 587,305 72,083 1,503,739 384,564 2.740.657
Internal transfers from work in progress 5,679 : 14,973 46,924 : (75.698) -
Write-offs {2 {7.966} (300,937) (27,804) (118,131) - (454,838)
Closing gross vatue as at 30 June 2014
Accumulated depreciation and impairment
Opening balance as at 1 July 2013 - - |e | - - [| :
Valuation adjustment on de-amalgamation 7(c) 14,436,757 - «85,310,404 42,599,233 21,666,226 164,012,705
Depreciation provided in period {1 749,306 244,723 4,462,163 911,182 1,390,772 | 7,758,146
Depreciation on disposals 6 pa - . (76) . . :
Depreciation on write-offs 12 dT SAS) (91,843) (11,745) (33.761) (138,894)
Accumulated depreciation as at 30 June 2014 LE 1586063] i230 [——_—«89,680,724 fF a3. agac7o[ 23.003.238 [171,631.88 |
Total written down value as at 30 June 2014 NEAT SAN KO TA Re RCT
Range of estimated useful life in years [Not depreciated | 30-100 [3-20 1 1208 Oi
Addition of other assets 59,389 50,201 83,376 97,983 - 3,820 1,483,390
Total additions i period 59399 [50201 16 | 38305 [0 [58TH 98 954524 |
* ARS denotes - Asset Revaluation Surplus
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Page 24Section 55
NOOSA SHIRE COUNCIL -
Notes to the financial statements
“For the six months ending 30 June 2014
18 Consolidated property, plant and equipment
Note Land Buildings Plant and Equipment} Road and Bridge Storm Water Other infrastructure | Works in progress Total
Network Assets
Basis of measurement [Valuation | Valwation | ___Cost___——'| ‘Valuation | __—Valuation [Valuation | Cost TO
2014 2014 2014 2014 2014 2014 2014 2014
Asset Values $ $ $ $ $ $ $ $
Assets transferred from de-amalgamated council 159,859,939 60,480,551 7,397,557 550,252,152 104,064,222 54,709,289 3,454,924 940,218,634
Valuation adjustment on de-amalgamation 7c) (38,979,941) 44,015,208 - 64,818,214 21,284,899 102,577,950
Additions at cost 59,389 50,201 83,376 587,305 72,083 1,503,739 384,564 2,740,657
Internat transfers from work in progress 5,679 - 8,121 14,973 - (75,698) -
Disposals 6 J = (3,003) - | - (3,003)
Write-offs 12 - (7.966) (118.131) : (454.838)
Closing gross value as at 30 June 2014
Accumulated depreciation and impairment
Opening balance as at 1 July 2013 [te oa ° : - - :
Valuation adjustment on de-amalgamation we [| 14,436,757 - 85,310,404 42,599,233 21,666,226 164,012,705 :
Depreciation provided in period uf 749,306 | _ 244,723 4,462,163 1,390,772 a 7,758,146
Depreciation on disposals 6 po - (76) - | tid - (76) .
Depreciation on write-offs 12 - (1,545) (91,843) (33.761) (138,894
Accumulated depreciation as at 30 June 2014 PT —C*dECOSS~SS 86063 [HOD [89,680,724 [43,498,670 [23,023.38 171,631,881 |
otal written down value as at 30 June 2014
Range of estimated useful life in years F Not depreciated | 30-100, | 3-20 ~—=| 0-100 | 80 | 200d
Addition of other assets 59,389 97,983 - 3,820 1,483,390
Total additions in period
* ARS denotes - Asset Revaluation Surplus
a
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no
Page 25Section 56
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
rr A A RR errr
19s Fair value measurements
(i) Recognised fair value measurements
Council measures and recognises the following assets at fair value on a recurring basis:
Property, plant and equipment
- Land
- Buildings
- Road and Bridge Network
- Storm Water
~ Other Infrastructure Assets
Council does not measure any liabilities at fair value on a recurring basis.
Council has assets and liabilities which are not measured at fair value, but for which fair values are disclosed in other notes,
Council borrowings are measured at amortised cost with interest recognised in profit or loss when incurred, The fair value of borrowings disclosed in note 23 is
provided by the Queensland Treasury Corporation.
The carrying amounts of trade receivables and trade payables are assumed to approximate their fair values due to their short-term nature (Level 2),
A description of the valuation techniques and the inputs used to determine the fair value of this land is included below under the heading "Land (level 2)”.
In accordance with AASB 13 fair value measurements are categorised on the following basis:
~ Fair value based on quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1)
- Fair value based on inputs that are directly or indirectly observable for the asset or liability (Level 2)
~ Fair value based on unobservable inputs for the asset and liability (Level 3)
The fair values of the assets are determined using valuation techniques which maximise the use of observable data, where it is available, and minimise the use of
entity specific estimates. If all significant inputs required to fair value an asset are observable, the asset is included in level 2. If one or more of the significant
inputs is not based on observable market data, the asset is included in level 3. This is the case for Council infrastructure assets, which are of a specialist nature for
which there is no active market for similar or identical assets. These assets are valued using a combination of observable and unobservable inputs.
The following table categorises fair value measurements as either level 2 or level 3 in accordance with AASB 13. Council does not have any assets or liabilities
measured at fair value which meet the criteria for categorisation as tevel 1.
The table presents the Council's assets and liabilities measured and recognised at fair value at 30 June 2014, Comparative information has not been provided as
allowed by the transitional provisions of AASB 73 Fair Value Measurement.
Note
(Significant other (Significant
observable inputs) unobservable
2014 2014 2014
$ $ $
Recurring fair value measurements
Property, plant and equipment 18
- Land 120,945,066 - 120.945,066
- Buildings $9,359,897 59,359,897
- Road and Bridge Network - 525.690.984 525,690,984
- Storm Water - 104,337,298 104,337,298
- Other Infrastructure Assets - $4,356,557 34,356,557
120,945,066 743.744,736 864,689,802
There were no transfers between levels 1 and 2 during the year, nor between levels 2 and 3.
Council's policy is to recognise transfers in and out of the fair value hierarchy levels as at the end of the reporting period.
certified statements
Page 26Section 57
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
(ii) Valuation techniques used to derive fair values for Jevel 2 and level 3 valuations
Council adopted 44SB/3 Fair Value Measurement this financial year and has reviewed each valuation to ensure compliance with the requirements of
the new standard. There have been no changes in valuation techniques as a result of this review.
Specific valuation techniques used to value Council assets comprise:
Property, plant and equipment
Land (level 2)
Land fair values were determined by an independent valuer, AssetVal Pty Ltd effective 1 January 2014. Level 2 valuation inputs were used to value land
in freehold title as well as land used for special purposes, which is restricted in use under current zoning rules. Sales prices of comparable land sites in
close proximity are adjusted for differences in key attributes such as property size, The most significant inputs into this valuation approach are price per
square metre.
Buildings (ievel 3)
A review of the fair value of buildings was undertaken effective 1 January 2014 using the non residential cast of construction index rates. The index
showed an decrease of -0.697% since 30 June 2013. This index was used to determine the fair-value of the buildings as at | January 2014
In determining the level of accumulated depreciation the asset has been disaggregated into significant components which exhibit useful lives,
Allowance has been made for the typical asset life cycle and renewal treatments of each component, the residual value at the time the asset is
considered to be no longer available for use and the condition of the asset. Condition was assessed taking into account both physical charactenstics as
well as holistic factors such as functionality, capability, utilisation and obsolescence.
The last comprehensive revaluation of Buildings was completed by Australian Pacific Valuers under the auspices of Sunshine Coast Regional Council
as at 30 June 2012.
A review of market data obtained from the Australian Bureau of Statistics, Non residential cost of Construction Queensland Index rates for the period |
January 2014 to 30 June 2014 shows no significant material changes and therefore the values are considered still at fair value.
Infrastructure assets (level 3)
All Council infrastructure assets were fair valued using written down current replacement cost (CRC), This valuation comprises the asset's current
replacement cost (CRC) Jess accumulated depreciation calculated on the basis of such cost to reflect the already consumed or expired future economic
benefits of the asset. Council first determined the gross cost of replacing the full service potential of the asset and then adjusted this amount to take
account of the expired service potential of the asset.
CRC was measured by reference to the lowest cost at which the gross future economic benefits of the asset could currently be obtained in the normal
course of business. Where existing assets were over designed, had excess capacity, or were redundant an adjustment was made so that the resulting
valuation reflected the cost of replacing the existing economic benefits based on an efficient set of modern equivalent assets to achieve the required
level of service output within the council's planning horizon.
Specific valuation techniques used to value Council infrastructure assets comprise:
1(a} Road and Bridge Network - calculation of current replacement cost
Reads
Current replacement cost:
Roads Infrastructure fair values were determined by an independent valuer, Aurecon Australia Pty Lid effective 1 January 2014. The valuation
technique used to determine fair value is essentially based on price modelling of the fair value through ‘Level 3' uncbservable inputs.
Assets have been valued on the basis of fair value in accordance with the requirements of applicable Australian Accounting Standards, in particular
AASB 116 "Property, Plaut & Equipment and AASB 13 'Fair Value Measurement. ,
The fair-value unit rate was determined using the prevailing market cost for supply and installation of similar assets or their modern equivalent. The
unit rates were predominantly developed from first principles by estimating the plant, material and labour required for asset replacement. The base
rates were sourced from focal suppliers estimates and quotes, contract schedules for work recently completed and council records, Where costs have
not been readily available then rates were obtained from Aurecon's cost database or the Rawlinson 2014 edition of the Australian Construction
Handbook.
Council uses 3 distinct location factors categorising its road infrastructure into urban, rural and commercial / industrial. Roads are further categorised
as sealed or unseated and managed in segments. Al] road segments are then further componentised into the sub classes of assets that make up eaclt
segment, i.e. Road Surface, Road pavement - base, Road pavement - sub-base. Road shoulder, Formation, Kerbs, footpaths etc, Each asset unit rate is
determined on cost to construct, material type and useful life to facilitate valuation and depreciation
ee ie certified statements
Page 27Section 58
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
SS RSET
19 Fair value measurements - continued
In most cases the movement in base unit rates has been modest although there have been some larger increases due to increased material supply costs
and plant hire rates.
A review of the Australian Bureau of Statistics Queensland Roads. and Bridges Indices for the period 1 January to 30 June 2014 shows no significant
material changes and therefore the values are considered still at fair value
Accumulated depreciation:
In determining the level of accumulated depreciation, roads were disaggregated into significant components which exhibited different useful lives.
Estimated useful lives are disclosed in note 18.
Bridges
Current replacement cost:
A full valuation of bridges assets was undertaken by independent valuers, Aurecon Australia Pty Ltd effective } January 2014. All bridges, with
exception to 3 major bridges, were valued based on unit rates developed according to varying materia! types used for construction, the deck area, size
and length. Construction estimates were determined on a similar basis to roads. Significant bridge structures were individually assessed by Aurecon
Australia Pty Ltd.
A review of the Australian Bureau of Statistics Queensland Roads, and Bridges Indices for the period } January 2014 to 36 June 2014 shows no
significant material changes and therefore the values are considered still at fair value,
Accumulated depreciation: .
In determining the level of accumulated depreciation, bridges were disaggregated into significant construction materials which exhibited different
useful lives
Estimated useful lives are disclosed in note 18.
Stormwater
Current repiacement cost:
The fair value of stormwater assets was determined by reference to the Australian Bureau of Statistics Road and Bridge Construction Qld December
2013 quarter which reflected an increment of 1.921%
Where Stormwater assets are located underground and physical inspection is not possible, the age, size and type of construction material, together with
current and planned maintenance records are used to determine the fair value at reporting date. Council uses both location and depth adjustment factors
in its calculation of fair value as presented in the table below.
SSE eA djustment Raetors ooo ee
| Location | Depth
Rural <1.5in
Urban 1.5m to 2.5m
Industrial/Commercial 2.5m to 3.5m
3.5m to 4.5m
> 4.5m
The last comprehensive revaluation of Stonmwater was completed by Aurecon Australia Pty Ltd under the auspices of Sunshine Coast Regional Council
as at 30 June 2012.
Accumulated depreciation:
In determining the level of accumulated depreciation, Stormwater assets were disaggregated into significant components which exhibited different
useful lives.
Estimates of expired service potential and remaining useful lives were determined on a straight line basis based on industry standard practices and past
experience, supported by maintenance programs.
Estimated useful lives are disclosed in note 18.
A review of the Australian Bureau of Statistics Queensland Roads, and Bridges Indices for the period 1 January 2014 to 30 June 2014 shows no
significant material changes and therefore the values are considered still at fair value
to certified statements
Page 28Section 59
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
oe a A Nn
19 Fair value measurements - continued
1(b) Reads, Stormwater and Bridge network — Sensitivity of valuation to unobservable inputs
As detailed above Council's roads, drainage and bridge network has been valued using written down current replacement cost. This method ulilises a
number of inputs that require judgement and are therefore classed as unobservable. While these judgements are made with the greatest care, and based
upon years of experience, different judgements could result in a different valuation. The table below summarises the effect that changes in the mast
significant unobservable inputs would have on the valuation:
Significant unobservable input] 2°: Range of inputs Relationship of unobservable inputs te
Se : ‘fairvalie
Number of Labour hours 5-]00hrs/linear metre or sqm The higher the labour hours, the higher the
fair value
Standard material usage quantities | Varies depending upon the type of material The higher the usage quantities, the higher
the fair value
Remaining useful life 10-120 years ‘The longer the remaining useful life. the
higher the fair vatue.
2(a) Stormwater and Other Infrastructure — Calculation of written down current replacement cost
The fair value of other infrastructure was determined by reference to the non-residential cost of construction index rates effective | January 2014.
Where there is a market for Council's other infrastructure assets, fair value has been derived from the sales prices of comparable assets.
Accumulated depreciation:
In determining the level of accumulated depreciation the asset has been disaggregated into significant components which exhibit useful lives.
Allowance has been made for the typical asset life cycle and renewal treatments of each component, residual value at the time the asset is considered to
be no longer available for use and the condition of the asset. Condition was assessed taking into account both physical characteristics as well as holistic
factors such as functionality, capability, utilisation and obsolescence.
(iii) Changes in Fair Value Measurements using significant unobservable inputs (tevel 3)
There have been no transfers between level 1,2 or 3 measurements during the year.
* ‘ , pe certified statements
Page 29Section 60
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
20 Intangible assets
Net carrying value at period end:
Computer Software 2,268,600 2,268,600
2,268,600 2,268,600
Computer Software
Acquired at cost 2,171,862 2,171,862
Assets transferred from de-amalgamated Council 118,247 118,247
2,290,109 2,290,109
Accumulated amortisation
Amortisation in the period 21,509 21,509
21,509 21,509
Net carrying value at end of the financial year 2,268,600 2,268,600
Straight line amortisation has been used with no residual value.
Software has a useful life estimated at ten years.
21 Trade and other payables
Current
Accruals 2,054,226 2,054,226
Creditors 1,185,975 1,185,975
Employee related accruals 835,081 835,081
Annual leave 1.23(b) 2,484,788 2,484,788
Other entitlements 109,720 109,720
6,669,789 6,669,789
Employee benefit expenses are calculated at current pay levels and adjusted for
inflation and likely future changes in salary level.
22 Provisions
Current
Long service leave 1.23(e) 4,358,384 4,358,384
4,358,384 4,358,384
Non-Current
Long service leave 1.23(e) 447,272 447,272
Property restoration:
(i) Landfill sites 7,719,069 7,719,069
(ii) Quarry sites 50,000 50,000
8,216,341 8,216,341
Details of movements in provisions:
Long service leave
Balance at the beginning of financial year - -
Transferred from de-amalgamated council 5,751,090 5,751,090
Amount provided for in the period 258,040 258,040
Amount paid in the period (1,203,475) (1,203,475)
Balance at end of the financial year 4,805,656 4,805,656
. Loge, certified statements
Page 30Section 61
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note s $
(i) Landfill sites
Transferred from de-amalgamated council 4,598,150 4,598,150
Accounting adjustment on de-amalgamation 7(c) 3,120,919 3,120,919
Balance at end of the financial year 7,719,069 7,719,069
Current portion - -
Non-current portion 7,719,069 7,719,069
This is the present value of the estimated future cost of restoring the Noosa landfill
under the State Government environmental regulations at the end of its useful life.
Gi} Quarry sites
Transferred from de-amalgamated council 50,000 50,000
Balance at end of the financial year 50,000 50,000
Current portion - -
Non-current portion $0,000 50,000
50,000 50,000
This is the present value of the estimated future cost of restoring the quarry sites
under the State Government environmental regulations at the end of its useful life.
23 Borrowings
{a) Bank overdraft
The council does not have a bank overdraft facility.
(b) Unsecured borrowings
Unsecured borrowings are provided by the Queensland Treasury Corporation.
All borrowings are in AUD denominated amounts and carried at amortised cost, interest
being expensed as it accrues. No interest has been capitalised during the current or
comparative reporting period. Expected final repayment dates vary from 29 September
2025 to 19 February 2026.
There have been no defaults or breaches of the loan agreement during the period.
Principal and interest repayments are made quarterly in arrears.
Details of borrowings at balance date are:
Current
Queensland Treasury Corporation 2,600,397 2,600,397
Non Current
Queensland Treasury Corporation 38,576,628 38,576,628
Details of movements in borrowings:
Queensland Treasury Corporation
Loans raised 2,300,000 2,300,000
Loans recognised on the de-amalgamation from SCRC 40,048,048 40,048,048
Loan interest capitalised in period 1,137,954 1,137,954
Principal repayments (2,308,977) (2,308,977)
Balance at end of the financial year 41,177,025 41,177,025
Classified as :
Current 2,600,397 2,600,397
Non-current 38,576,628 38,576,628
41,177,025 41,177,025
, certified statements
Page 31Section 62
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
The QTC joan market value at the reporting date was $45,805,276.88
This represents the value of the debt if Council repaid it at that date. As it is the
intention of Council to hold the debt for its term, no provision is required to be made
in these accounts,
No assets have been pledged as security by the council for any liabilities.
Borrowings are all in AUD and are underwritten by the Queensland State
Government.
24 Other liabilities
Current
Unearned revenue 729,623 729,623
Cash collected under service level agreements 101,517 101,517
831,140 831,140
25 Retained surplus 1.27
Movement in retained surplus
Balance at the beginning of financial year - -
Net result 973,500,642 972,461,897
Balance at end of the financial year 973,500,642 972,461,897
26 Commitments for expenditure
Operating leases
Minimum lease payments in relation to non-cancellable operating
leases are as follows:
Within one year 975,908 975,908
Later than | year but not later than 5 years 527,841 527,841
1,503,749 1,503,749
Operating leases are entered into for motor vehicles and IT equipment.
lease payments are generally fixed, but with inflation clauses on
which future rentals are determined,
Contractual Commitments
Contractual commitments at balance date but not recognised
in the financial statements are as follows:
Within one year 5,162,500 5,162,500
One to five years 1,671,416 1,671,416
6,833,916 6,833,916
Capital Commitments
Commitment for the construction of the following assets contracted for at the
reporting date but not recognised as liabilities are as follows:
Roads, Bridges and Stormwater 510,800 510,800
Pathways 514,500 514,500
Information Technology 128,100 128,100
Other 110,600 110,600
1,264,000 1,264,000
These expenditures are payable :
Within one year 1,264,000 1,264,000
Later than | year but not later than 5 years - -
Later than 5 years - -
1,264,000 1,264,000
QAO
Page 32Section 63
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
27 Events after balance date
On the 10th December, the Honourable David Crisafulli MP, Minister for Local
Government, Community Recovery and Resilience handed down his final
determination relating to the five outstanding issues raised for adjudication.
As a result of the review process, the Minister has ruled that a further $2.293 million
will be paid to Council to finalise the matter. This amount has been included as a
receivable.
28 Contingent Hiabilities
Details and estimates of maximum amounts of contingent liabilities are as follows:
In the opinion of Council's solicitors, there are currently no claims pending against
Council for the period ending 30 June 2014.
Local Government Workcare
The Noosa Shire Council is a member of the Queensland local
government workers compensation self-insurance scheme, Local Government
Workcare. Under this scheme the Council has provided a bank guarantee
to cover bad debts which may remain should the self insurance licence
be cancelled and there was insufficient funds available to cover outstanding
liabilities. Only the Queensland Government's workers compensation authority
may call on any part of the guarantee should the above circumstances arise.
The Council's maximum exposure to the bank guarantee is: 290,070 290,070
Local Government Mutual
The Council is a member of the local government mutual liability self-insurance
pool, LGM Queensland. In the event of the pool being wound up or it is unable
to meet its debts as they fall due, the trust deed and rules provide that any
accumulated deficit will be met by the individual pool members in the same
proportion as their contribution is to the total poo] contributions in respect to
any year that a deficit arises.
As at 30 June 2014 the financial statements reported an accumulated surplus and
it is not anticipated any liability will arise.
29 Superannuation
The Council contributes to the Local Government Superannuation Scheme (Qld)
(the scheme). The scheme is a Multi-employer Plan as defined in the Australian
Accounting Standard AASB/19 Employee Benefits .
The Queensland Local Government Superannuation Board, the trustee of the
scheme, advised that the local government superannuation scheme was a complying
superannuation scheme for the purpose of the Commonwealth Superannuation
Industry (Supervision) legislation.
. QAO
: certified statements
Page 33Section 64
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
The scheme has three elements referred to as:
The City Defined Benefits Fund (CDBF) which covers former members of the City
Super Defined Benefits Fund
The Regional Defined Benefits Fund (Regional DBF) which covers defined benefit
fund members working for regional local governments; and
The Accumulation Benefits Fund (ABF)
The ABF is a defined contribution scheme as defined in AASB 119. Council has no
liability to or interest in the ABF other than the payment of the statutory
contributions as required by the Local Government Act 2009.
Council does not have any employees who are members of the CDBF and, therefore,
is not exposed to the obligations, assets or costs associated with this fund.
The Regional DBF is a defined benefit plan as defined in AASB119. The Council is
not able to account for the Regional DBF as a defined benefit plan in accordance
with AASB119 because the scheme is unable to account to the Council for its
proportionate share of the defined benefit obligation, plan assets and costs. The
funding policy adopted in respect of the Regional DBF is directed at ensuring that
the benefits accruing to members and beneficiaries are fully funded as they fall due.
To ensure the ongoing solvency of the Regional DBF, the scheme's trustee can vary
the rate of contributions from relevant local government employers subject to advice
from the scheme's actuary. As at the reporting date, no changes had been made to
prescribed employer contributions which remain at 12% of employee assets and
there are no known requirements to change the rate of contributions.
Any amount by which the fund is over or under funded would only affect future
benefits and contributions to the Regional DBF, and is not an asset or liability of the
Council. Accordingly there is no recognition in the financial statements of any over
or under funding of the scheme.
As at the reporting date, the assets of the scheme are sufficient to meet the vested
benefits.
The most recent actuarial assessment of the scheme was undertaken as at 1 July
2012. The actuary indicated that “the Regional DBF is currently in a satisfactory but
modest financial position and remains vulnerable to adverse short and medium term
experience.”
Following the previous actuarial assessment in 2009, councils were advised by the
trustee of the scheme, following advice from the scheme’s actuary, that additional
contributions may be imposed in the future at a level necessary to protect the
entitlements of Regional DBF members. In the 2012 actuarial report the actuary has
recommended no change to the employer contribution levels at this time.
Under the Local Government Act 2009 the trustee of the scheme has the power to
levy additional contributions on councils which have employees in the Regional
DBF when the actuary advises such additional contributions are payable - normally
when the assets of the DBF are insufficient to meet members’ benefits.
_ ~ QAO
certified statements
Page 34Section 65
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014 Consolidated Council
2014 2014
Note $ $
There are currently 71 councils contributing to the Regional DBF plan and any
changes in contribution rates would apply equally to all 71 councils, Noosa Shire
Council made less than 4% of the total contributions to the plan in the 2013-14
financial year.
The next actuarial investigation will be conducted as at 1 July 2015. :
The amount of superannuation contributions paid by Noosa Shire Council
to the scheme in this period for the benefit of employees was: 1,305,459 1,305,459
30 Trust funds 1.30
Trust funds held for outside parties:
Monies collected or held on behalf of other entities yet
to be paid out to or on behalf of those entities 2,640,702 2,640,702
2,640,702 2,640,702
The Noosa Shire Council performs only a custodial role in respect of these monies,
and because the monies cannot be used for Council purposes, they are not brought to
account in these financial statements.
31 Reconciliation of net result for the year to net cash
inflow (outflow) from operating activities
Net result 973,500,642 972,461,897
Non-cash operating items:
Impairment of receivables and bad debts written off 10 909 909
Depreciation and amortisation lt 7,779,655 7,779,655
Interest expense capitalised in QTC loans 1,137,954 1,137,954
8,918,518 8,918,518
Investing and development activities:
Capital grants, subsidies and contributions 4 (2,358,968) (2,358,968)
Capital income 5 (7,228) (7,228)
Capital expenses 12 315,945 315,945
Net equity income from investments (1,038,745) -
Net gain on restructure of local government (972,198,126) (972,198,126)
(975,287,122) (974,248,377)
Changes in operating assets and liabilities :
(Increase) decrease in receivables (2,124,994) (2,124,994)
(Increase) decrease in inventories (excluding land) (103,425) (103,425)
Increase (decrease) in payables 3,969,228 3,969,228
Increase (decrease) in provisions (3,926,236) (3,926,236)
Increase (decrease) in other liabilities 84,406 84,406
(2,101,021) (2,101,021)
Net cash inflow from operating activities 5,031,016 ~~ 5,031,016 _
32 Operating lease income s $
The council has leased properties to various tenants under commercial lease
arrangements.
The expected future income is as follows:
Within One Year 300,614 300,614
Within One to Five Years $03,190 503,190
Greater Than Five Years - -
Total 803,804 803,804
QAO ;
Page 35 certified statermen
j $sSection 66
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2614
33 Financial instruments
Noosa Shire Council has exposure to the following risks arising from financial instniments:
- credit risk
+ liquidity risk
- market risk
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.
Financial risk management
Noosa Shire Council is responsible for the establishment and oversight of the risk management framework, together
with developing and monitoring risk management policies,
Council's management approves policies for overall risk management, as well as specifically for managing credit,
liquidity and market risk,
The Council's risk management policies are established to identify and analyse the risks faced, to set appropriate limits
and 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. Noosa Shire Council does not enter into derivatives.
Credit Risk
Credit risk is the risk of financial toss if a counterparty to a financial instrament fails to meet its contractual obligations.
These obligations arise principally from the Council's investments and receivables from customers,
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.
Investnents in financial instrments 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.
No collateral is held as security relating to the financial assets heid by Noosa Shire Council.
The following table represents the maximum exposure to credit risk based on the carrying amounts of financial assets at
the end of the reporting period:
Note 2014
Financial Assets $
Cash and cash equivalents - Bank 14 77,994
Cash investments held with - QTC 14 25,118,325
Cash investments held with other
approved deposit taking institutions 14 5,926,935
Equity investments 17 60,978,225
Receivables - rates 15 4,159,585
Receivables - other 15 63,452,309
Other credit exposure
Guarantee 28 290.070
Total 160,003,243
Cash and cash equivalents
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 onc 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 financial assets
Other investments are held with financial institutions. which are railed AAA to AA- based on rating Standard and Poor's
agency ratings, and whilst not capital guaranteed, the likelihood of a credit failure is assessed as remote.
QAO
Page 36Section 67
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
33 Financia! instruments - continued
Trade and other receivables
In the case of rate receivables, Council has the power (o sell the property to recover any defaulted amounts. In effect this
power protects the Council against credit risk in the case of defaults.
in other cases, Council assesses the credit risk before providing goods or services and applies normal business credit
protection procedures to minimise the risk.
By the nature of the Councils operations, there is a geographical concentration of risk in the Council's area.
Ageing of past due receivables and the amount of any impairment is disclosed in the following table:
OS
2014 Consolidated 10.371.206 138.236 79.163 5.428.386 | 16.016.992
2014 Council 0.371.206 138.236 5.428.386 | wt $.0 16.992
The above analysis does not include the non-current receivable of $49,217,517 which represents a fixed rate loan to Unitywater.
Refer to Note 15 for further information.
Liquidity risk
Liquidity risk is the risk that the Council will encounter difficulty in meeting the obligations associated with its financial
liabilities that are settled by delivering cash or another financial asset.
Noosa Shire Council is exposed to liquidity risk through its normal course of business and through its borrowings
with QTC and other financial institutions.
The Council manages its exposure to liquidity risk by maintaining sufficient cash deposits and undrawn facilities, both short
and long term, to cater for unexpected volatifity in cash flows.
The following table sets out the liquidity risk in relation to financial liabilities held by the Council. It represents the
remaining contractual cashflows (principal and interest) of financial liabilities at the end of the reporting period,
excluding the impact of netting agreements:
2014 COS USO PSU See ee Ss
Trade and other payables 4,075,282 - 4.075,282 4,075,282
QTC Loans 7,113,778 19,436,191 | 32,049.878 | 58,599,846 | 41,177,025
___11,189,059 | 19,436,193 | 32,049,878 | = 62,675,128 | 45,252,307 |
2014 ES pes os ss
Trade and other payables 4,075,282 4,075,282 4,075,282
QTC Loans 7,113,778 | 19,436,191 | 32,049,878 | 58,599,846 | _ 41,177,025
11,189,059 19,436,191 32,049,878 62,675,128 45,252,307
The outflows in the above table are not expected to occur significantly earlier than outlined and are not expected to be materially
different amounts than indicated in the table.
QAO
certified statements
Page 37Section 68
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
33 Financial instruments - continued
Market risk
Market risk is the risk that changes in market prices, suclt as interest rates, will affect the Council's income or the value
of its holdings of financial instraments.
Interest rate risk
Noosa Shire Council is exposed to interest rate risk through investments with QTC and other financial institutions.
The Council has access to a mix of variable and fixed rate funding options through QTC so that interest rate risk exposure
catt be minimised,
Sensitivity
Sensitivity to interest rate movements is shown for variable financial assets and liabilities based on the carrying amount
at reporting date.
The following interest rate sensitivity analysis depicts what effect a reasonably possible change in interest rates (assumed
to 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,
Consolidated
Financial assets and liabilities that are | amount |. 1% increase“ 1¢ decrease | 19éinerease | 19s decrease”
held at variable interest rates total: rs {| s {| s | 5 Jos |
QTC cash funds
Other investments
Loans - QTC
Net total
Council
Financial assets and liabilities that are © amounts | 19 increase | 196 decrease 1° 1% increase | 1% decrease.
held at variable interest rates total: ros ldT|llcs tls gg
QTC cash funds
Other investments
Loans -QTCat fixed and generic* | canimnoryt TT
Net total
Lomas - QTC at variable ee ee es ee ee
In relation to the QTC loans held by the Council, the following has been applied:
*QTC Generic Debt Pool - the generic debt pool products approximate a fixed rate loan, There is a negligible impact on interest
sensitivity from changes in interest rates for generic debt pool borrowings.
The sensitivity analysis provided by QTC is currently based on a 1% change but this is subject to change.
Fair Value
The fair value of trade and other receivables and payables is assumed to approximate the value of the original transaction,
less any allowance for impairment.
The fair value of borrowings with QTC is based on the market value of debt outstanding. The market value of a debt
obligation is the discounted value of future cash flows based on prevailing market rates and represents the amount required
to be repaid if this was to occur at balance date. The market value of debt is provided by QTC and is discussed below and
disclosed in note 23.
QTC applies a book rate approach in the management of debt and interest rate risk, to limit the impact of market value
movements to clients’ cast of funding. The book value represents the carrying value based on amortised cost using the
effective interest method.
certified statements
Page 38Section 69
: !
NOOSA SHIRE COUNCIL
Notes to the financial statements
For the six months ending 30 June 2014
34 National Competition Policy
(a) Business activities to which the code of competitive conduct is applied
This requires the application of full cost pricing, identifying the cost of community service obligations (CSO)
and eliminating the advantages and disadvantages of public ownership within that activity.
The CSO value is determined by Council, and represents an activities cost(s) which would not be incurred if
the primary objective of the activities was to make a profit. The Council provides funding from general revenue
to the business activity to cover the cost of providing non-commercial community services or costs deemed to
be CSO's by the Council.
The Noosa Shire Council applies the competitive code of conduct to the following activities:
Waste Management
Holiday Parks
(b) The following activity statements are for activities subject to the competitive code of conduct:
2014 2014
$ $
Revenue for services provided to ihe Council 91,616
Revenue for services provided to external clients 6,125,809 1,336,427
* Community service obligations 9,906
6,227,331 1,336,427
Less : Expenditure 4,833,436 747,415
Surplus (deficiency) 1,393,895 589,012
(ec) Description of CSO's provided to business activities during the reporting period.
[tivities CICS description
Waste Management Waste collection and disposal charges for charitable organisations.
QAO
, ta certified statements
Page 39Section 70
{ ‘
NOOSA SHIRE COUNCIL
FINANCIAL STATEMENTS
For the six months ending 30 June 2014
MANAGEMENT CERTIFICATE
For the six months ending 30 June 2014
These general purpose financial statements have been prepared pursuant to sections 176 and 177 of the
Local Government Regulation 2012 (the Regulation) and other prescribed requirements.
In accordance with section 212(5) of the Regulation we certify that:
(i) _ the prescribed requirements of the Local Government Act 2009 and Local Government Regulation 2012
for the establishment and keeping of accounts have been complied with in ail material respects; and
(ii) the general purpose financial statements, present a true and fair view, in accordance with Australian Accounting
Standards, of the Council’s transactions for the financial period and financial position as at the end of the financial period.
Mayor Chief Executivefficer
sane Mhec E.ategthea se Name: BRETT Netra de CuasTee
Dae: / £7 f+ 2erlZ Date: (B (2 / 2orey
oe ~ QAO
: certified statements __/
Page 40Section 71
: 1
INDEPENDENT AUDITOR’S REPORT
To the Mayor of Noosa Shire Council
Report on the Financial Report
| have audited the accompanying financial report of Noosa Shire Council, which comprises
the statements of financial position as at 30 June 2014, the statements of comprehensive
income, statements of changes in equity and statements of cash flows for the period 1 January
2014 to 30 June 2014, notes comprising a summary of significant accounting policies and
other explanatory information, and certificates given by the Mayor and Chief Executive Officer
of the Council and the consolidated entity comprising the Council and the entities it controlled at
the period’s end and from time to time during the financial period.
The Council's Responsibility for the Financial Report
The Council is responsible for the preparation of the financial report that gives a true and fair
view in accordance with prescribed accounting requirements identified in the Local
Government Act 2009 and the Local Government Regulation 2012, including compliance with
Australian Accounting Standards. The Council’s responsibility also includes such internal
control as the Council determines is necessary to enable the preparation of the financial report
that gives a true and fair view and is free from material misstatement, whether due to fraud or
error.
Auditor's Responsibility
My responsibility is to express an opinion on the financial report based on the audit. The audit
was conducted in accordance with the Auditor-General of Queensland Auditing Standards,
which incorporate the Australian Auditing Standards. Those standards require compliance
with relevant ethical requirements relating to audit engagements and that the audit is planned
and performed to obtain reasonable assurance about whether the financial report is free from
materia! misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the financial report. The procedures selected depend on the auditor’s
judgement, including the assessment of the risks of material misstatement of the financial
report, whether due to fraud or error. In making those risk assessments, the auditor considers
internal control relevant to the entity's preparation of the financial report that gives a true and
fair view in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity’s internal control,
other than in expressing an opinion on compliance with prescribed requirements. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness
of accounting estimates made by the Council, as well as evaluating the overall presentation
of the financial report.
| believe that the audit evidence obtained is sufficient and appropriate to provide a basis for
my audit opinion.Section 72
Section 73
: i
Independence
The Auditor-General Act 2009 promotes the independence of the Auditor-General and all
authorised auditors. The Auditor-General is the auditor of all Queensland public sector entities
and can be removed only by Parliament.
The Auditor-General may conduct an audit in any way considered appropriate and is not
subject to direction by any person about the way in which audit powers are to be exercised.
The Auditor-General has for the purposes of conducting an audit, access to all documents and
property and can report to Parliament matters which in the Auditor-General’s opinion are
significant.
Opinion
in accordance with s.40 of the Auditor-General Act 2009 ~
(a) | have received all the information and explanations which | have required; and
(b) in my opinion —
(i) the prescribed requirements in relation to the establishment and keeping of
accounts have been complied with in all material respects; and
(ii) the financial report presents a true and fair view, in accordance with the
prescribed accounting standards, of the financial performance and cash flows of
Noosa Shire Council and the consolidated entity for the period 1 January 2014
to 30 June 2014 and of the financial position as at the end of that period.
Other Matters - Electronic Presentation of the Audited Financial Report
Those viewing an electronic presentation of these financial statements should note that audit
does not provide assurance on the integrity of the information presented electronically and
does not provide an opinion on any information which may be hyperlinked to or from the
financial statements. If users of the financial statements are concerned with the inherent risks
arising from electronic presentation of information, they are advised to refer to the printed copy
of the audited financial statements to confirm the accuracy of this electronically presented
information.
7 of. 19 DEC 204
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P J FLEMMING CPA Queensland Audit Office
(as Delegate of the Auditor-General of Queensland) BrisbaneSection 74
Section 75
, i
NOOSA SHIRE COUNCIL
For the six months ending 36 June 2014
Current Year Financial Sustainability Statement
Certificate of Accuracy - for the Current Year Financial Sustainability Statement
Independent Auditor's Report (Current Year Financial Sustainability Statement)
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Page 41Section 76
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NOOSA SHIRE COUNCIL
Current-year Financial Sustainability Statement
For the period ended 30 June 2014
Measures of Financial Sustainability
(i) Operating surplus ratio
Operating surplus (Net result excluding all capital items) divided by total operating revenue (excludes capital revenue)
(iit) Asset sustainability ratio
Capital expenditure on the replacement of assets (renewals) divided by depreciation expense.
(iii) Net financial liabilities ratio
Total liabilities less current assets divided by total operating revenue
Council's performance at 30 June 2014 against key financial ratios: Operating Asset Net financial
surplus ratio | sustainability | liabilities ratio
ratio
Target between 0% and } greater than 90%] not greater than
8 10% 60%
Actual -Consolidated 6.49% 31.85% 32.43%
Actual - Council -4.22% 31.85% 31.74%
Note 1 - Basis of Preparation
The current year financial sustainability statement is a special purpose statement prepared in accordance with the requirements of the Local
Government Regulation 2012 and the Financial Management (Sustainability) Guideline 2013 . The amounts used to calculate the three
reported measures are prepared on an accrual basis and are drawn from the Council's audited general purpose financial statements for the year
ended 30 June 2014.
Certificate of Accuracy
For the period ended 30 June 2913
This current-year financial sustainability statement has been prepared pursuant to Section 178 of the Local Government
Regifation 2012 (the regulation) .
In accordance with Section 2/2/(5} of the Regulation we certify that this current-year financial sustainability statement
has been accurately calculated. : j ;
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Mayor Chief Executive Officer
name Mee. CSCO... Name: PET Meena dé Cla stee
Date: / f / Lo 2A/ be Date. /V / fe / Ay
QAO
certified statementsSection 77
' 4
INDEPENDENT AUDITOR’S REPORT
To the Mayor of Noosa Shire Council
Report on the Current-Year Financial Sustainability Statement
| have audited the accompanying current-year financial sustainability statement, which is a
special purpose financial report of Noosa Shire Council for the period ended 30 June 2014,
comprising the statement and explanatory notes, and certificate given by the Mayor and Chief
Executive Officer.
The Council's Responsibility for the Current-Year Financial Sustainability Statement
The Council is responsible for the preparation and fair presentation of the current-year
financial sustainability statement in accordance with the Local Government Regulation 2012.
The Council’s responsibility also includes such internal control as the Council determines is
necessary to enable the preparation and fair presentation of the statement that is accurately
calculated and is free from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
My responsibility is to express an opinion on the current-year financial sustainability statement
based on the audit. The audit was conducted in accordance with the Auditor-General of
Queensland Auditing Standards, which incorporate the Australian Auditing Standards. Those
standards require compliance with relevant ethical requirements relating to audit
engagements and that the audit is planned and performed to obtain reasonable assurance
about whether the statement is free from material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and
disclosures in the statement. The procedures selected depend on the auditor’s judgement,
including the assessment of the risks of material misstatement of the statement, whether due
to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the Council’s preparation and fair presentation of the statement in order to design
audit procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Council’s internal control. An audit also
includes evaluating the appropriateness of accounting policies used and the reasonableness
of accounting estimates made by the Council, as well as evaluating the overall presentation
of the statement.
My responsibility is to form an opinion as to whether the statement has been accurately
calculated based on the Council’s general purpose financial report. My responsibility does not
extend to forming an opinion on the appropriateness or relevance of the reported ratios, nor
on the Council's future sustainability.
| believe that the audit evidence obtained is sufficient and appropriate to provide a basis for
my audit opinion.Section 78
Section 79
: ’
Independence
The Auditor-General Act 2009 promotes the independence of the Auditor-General and all
authorised auditors. The Auditor-General is the auditor of all Queensland public sector entities
and can be removed only by Parliament.
The Auditor-General may conduct an audit in any way considered appropriate and is not
subject to direction by any person about the way in which audit powers are to be exercised.
The Auditor-General has for the purposes of conducting an audit, access to all documents and
property and can report to Parliament matters which in the Auditor-General’s opinion are
significant.
Opinion
In accordance with s.212 of the Local Government Regulation 2012, in my opinion, in all
material respects, the current-year financial sustainability statement of Noosa Shire Council,
for the period ended 30 June 2014, has been accurately calculated.
Emphasis of Matter ~ Basis of Accounting .
Without modifying my opinion, attention is drawn to Note 1 which describes the basis of
accounting. The current-year financial sustainability statement has been prepared in
accordance with the Financial Management (Sustainability) Guideline 2013 for the purpose of
fulfilling the Council’s reporting responsibilities under the Local Government Regulation 2012.
As a result, the statement may not be suitable for another purpose.
Other Matters — Electronic Presentation of the Audited Statement
Those viewing an electronic presentation of this special purpose financial report should note that
audit does not provide assurance on the integrity of the information presented electronically and
does not provide an opinion on any information which may be hyperlinked to or from the financial
statements. If users of the financial statements are concerned with the inherent risks arising
from electronic presentation of information, they are advised to refer to the printed copy of the
audited financial statements to confirm the accuracy of this electronically presented information.
QUEENSLAND
. 19 DEC 2014
A ©
SPIT OF
P J FLEMMING CPA Queensland Audit Office
(as Delegate of the Auditor-General of Queensland) BrisbaneSection 80
3 : we : a
Section 81
, ft
NOOSA SHIRE COUNCIL
Long-Term Financial Sustainability Statement
Prepared as at 30 June 2014
Measures of Financial Sustainability
(i) Operating surplus ratio
Operating surplus (Net result excluding all capital items) divided by total operating revenue (excludes capital revenue)
(ii) Asset sustainability ratio
Capital expenditure on the replacement of assets (renewals) divided by depreciation expense.
iil) Net financial liabilities ratio
Total liabilities less current assets divided by total operating revenue
Council's performance at 30 June 2014 against key financial ratios: Net financial
surplus ratio | sustainability | liabilities ratio
ratio
10% 60%
Consolidated Po
Actuals at 30 June 2014
Projected for the ye 30 June 2015
30 June 2016
. 30 June 2017
30 June 2018
30 June 2019
30 June 2020 | 5.30% 99.20%
30 June 2021
30 June 2022
30 June 2023
Council Po
Actuals at 30 June 2014
Projected for the ye 30 June 2015
30 June 2016
30 June 2017
30 June 2018
30 June 2019
30 June 2020
30 June 2021
30 June 2022
30 June 2023
Financial Management Strategy
Council measures revenue and expenditure trends over time as a guide to future requirements and to make decisions about the efficient allocation of
resources to ensure the most effective provision of services. Council ensures that its financial management strategy is prudent and that its long-term
financial forecast shows a sound financial position whilst also being able to meet the community’s current and future needs.
Certificate of Accuracy
For the long-term financial sustainability statement prepared as at 30 June 2014
This long-term financial sustainability statement has been prepared pursuant to Section 178 of the Local Government
Regulation 2012 (the regulation).
In accordance with Section 2 £2(5) of the Regulation we certify that this long-te ncial sustainabilityAtatement
has been accurately calculated. ( : | 7 mn
Mayor < Chief Executive Officer
Name: Nbew. Little. Name; Beer NOcney de. CHASTEL
Date: /f / Ld JOC YE Date: 1S 112 7 2are,Section 82
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Section 83
Appendix 2: Councillors’ Expenses Reimbursement Policy Appendix 2: Councillors’ Expenses Reimbursement Policy
Section 84
Council Policy
COUNCILLORS’ EXPENSES
REIMBURSEMENT POLICY
Corporate Plan Reference:
Endorsed by Council: 2 January 2014
Policy Author: Executive Manager
POLICY BACKGROUND
The purpose of this policy is to set the parameters to authorise payment of reasonable expenses
incurred, or to be incurred, by Councillors; and provide facilities to assist Councillors to discharge
their duties and responsibilities.
This policy will ensure accountability and transparency in the reimbursement of expenses incurred
by the Mayor and Councillors.
This policy applies to the Mayor and Councillors of Noosa Council.
This policy is compliant with the principles underpinning the Local Government Act 2009 (the Act),
that is:
Transparent and effective processes and decision-making in the public interest;
Good governance and legal behaviour of Councillors and local government employees.
This Policy applies to the Mayor and Councillors and is made pursuant to section 250 of the Local
Government Regulation 2012 and the Local Government Act 2009.
Noosa Council Page 1 of 7
Section 85
STRATEGIC POLICY – COUNCILLORS’ EXPENSES REIMBURSEMENT POLICY
Definitions
To assist in interpretation the following definitions shall apply:
Council Business shall mean official business conducted on behalf of Council, where a Councillor
is required to undertake certain tasks to satisfy legislative requirements or achieve council
objectives, for example official Council meetings, Councillor forums and workshops,
Committees/Boards as Council’s official representative, scheduled meetings relating to Council
appointments.
Council Business should result in a benefit being achieved either for the local government and/or
the local community, for example, this includes but is not limited to:
Preparing, attending and participating in Council meetings, Committee meetings, workshops,
strategic briefings, deputations and inspections;
Investigating issues/complaints regarding Council services raised by residents/ ratepayers/
visitors to the Council area;
Undertaking approved professional development opportunities;
Attending civic functions or events;
Attending public/community meetings, presentation dinners, annual general meetings where
invited as a Councillor;
Attending a community event (e.g. school fete, community group awards and presentations,
fundraisers) where a formal invitation has been received.
Participating in a community group event or being a representative on a Board not associated with
Council is not regarded as Council business.
Councillors shall mean the Mayor and Councillors unless otherwise stated.
Expense shall mean payments made by Council to reimburse Councillors for their reasonable
expenses incurred or to be incurred when discharging their duties as Councillors. These payments
are not regarded as remuneration. The expenses may be either reimbursed to Councillors or paid
direct by Council for something that is deemed a necessary cost or charge when on Council
business.
Facility shall mean the ‘tools of trade’ provided by Council, required to enable Councillors to
perform their duties with relative ease and at a standard appropriate to fulfil their professional role
for the community.
Reasonable shall mean the application of sound judgement and consideration of what is prudent,
responsible and acceptable to the community when determining levels of facilities and expenditure.
Noosa Council Page 2 of 7
Section 86
STRATEGIC POLICY – COUNCILLORS’ EXPENSES REIMBURSEMENT POLICY
COUNCIL POLICY
1 General Entitlement
Councillors are entitled to be reimbursed reasonable expenses incurred while undertaking Council
business and to be provided with facilities to assist them in undertaking their duties.
2 Professional Development
Council will reimburse or be responsible for the cost of reasonable expenses incurred for:
Mandatory professional development; and/or
Discretionary professional development deemed essential for the Councillor’s role.
Any professional development requiring overseas travel requires a formal Council resolution.
2.1 Mandatory Professional Development
Noosa Council will reimburse or cover expenses incurred for the following activities:
The Mayor’s attendance (or his Nominee Councillor) as the primary delegate at the LGAQ and
ALGA Annual Conferences and any other relevant conferences/seminars/workshops;
Workshops, courses, seminars and conferences that are important to the role of a Councillor.
Approval to attend is made by Council resolution following a report to Council seeking approval for
attendance, or by the Mayor.
2.2 Discretionary Professional Development
Each Councillor can attend, at their discretion, workshops, courses, seminars and conferences that
improve their skills relevant to the role of Councillor. This training is initially limited to $5,000 per
Councillor in each quadrennial term of office or $1,250 per year, but will be reviewed annually
when setting the budget.
There is no requirement for a Council resolution to approve these attendances. However, the
Councillor must submit details to the Chief Executive Officer prior to attending and provide all
relevant documentation within 14 days of attending the event to ensure reimbursement of
expenses.
3 Travel as Required to Represent Council
Council will reimburse travel expenses (e.g. flights, motor vehicle, accommodation, meals and
associated registration fees) deemed reasonable and necessary to achieve the business of
Council where:
A Councillor is an official representative of Council; and
The activity/event and travel has been endorsed by resolution of Council, or by the Mayor.
Approval for such travel is subject to the following conditions:
Wherever possible all travel by Councillors will be booked and paid for by Council in advance;
Council will generally cover accommodation up to a 4 star maximum standard;
Noosa Council Page 3 of 7
Section 87
STRATEGIC POLICY – COUNCILLORS’ EXPENSES REIMBURSEMENT POLICY
Overnight accommodation will be reimbursed when a Councillor is unexpectedly required to
stay outside the Sunshine Coast Region and it is unreasonable to expect the Councillor to
return home for the night;
Travel is to be undertaken by the most direct route;
Travel tickets are not transferrable;
Requests for travel should be made in sufficient time to take advantage of discounts and gain
access to the widest range of flights;
Economy class travel is the standard, unless otherwise approved;
Any fine issued whilst undertaking Council business is the responsibility of the Councillor
incurring the fine;
Travel insurance is provided for all Councillors on Council business;
4 Private Vehicle Usage
The use of a Councillor’s private vehicle for Council business (as defined) will be reimbursed by
Council. The Mayor will not receive any financial reimbursement for private vehicle use.
Councillors (excluding the Mayor) may elect one of two options regarding this reimbursement.
Option 1
Councillors accept an annual payment of $5,000 as reimbursement for the use of their private
vehicles on Council business.
Option 2
Councillors may make a monthly claim for reimbursement of use of their private vehicles on
Council business by submitting the appropriate form detailing the relevant travel based on log book
details.
The amount reimbursed will be based on the published Australian Tax Office business use of
motor vehicle cents per kilometre method, and kilometre rate applicable at the time of travel.
Councillors will be provided with an appropriate log book to assist in this process.
5 Meals
The reimbursement of meal costs of Councillors on Council business may be made using one of
the two methods below:
Method 1 - Council will reimburse the reasonable cost of meals where a Councillor:
Incurs the cost personally; and
Is not provided with a meal within the registration costs of the approved activity/event; and
Produces a valid tax invoice.
Method 2 - If a Councillor is unable to produce a tax invoice and seeks reimbursement for meals
while attending official Council business, he/she may claim up to a maximum of the meal
allowance amounts as stated within the current relevant Australian Taxation Office Taxation
Determination.
Expenses relating to the consumption of alcohol will not be reimbursed.
Noosa Council Page 4 of 7
Section 88
STRATEGIC POLICY – COUNCILLORS’ EXPENSES REIMBURSEMENT POLICY
6 Hospitality
Councillors may have occasion to incur hospitality expenses while conducting Council business,
apart from civic receptions organised by Council. The Mayor may particularly require additional
reimbursement when entertaining dignitaries outside of official events.
To allow for this expense, the following amounts can be claimed:
Councillors up to $500 per annum
Mayor up to $5,000 per annum
To claim, the Mayor or Councillor must provide a written statement of whom they entertained and
an indication of the costs. Receipts should be provided.
7 Accommodation
Councillors may need to stay away from home overnight while attending to Council business.
When attending conferences, Councillors should take advantage of the package provided by
conference organisers (if offered and applicable) and therefore stay in the recommended
accommodation unless prior approval has been granted by the Chief Executive Officer.
All accommodation associated with Council business will be booked and paid for by Council.
Suitable accommodation will be sought within a reasonable distance to the venue in which the
Councillor is to attend.
8 Administration Tools and Access to Council Office Amenities
Councillors will be provided with the following:
Access to suitable hot desks at the Tewantin Office and Council meeting rooms for usage as
required;
Administrative support at the Tewantin Office;
Use of Council landline telephone and internet access at the Tewantin Office;
Access to a printer, photocopier, paper shredder at the Tewantin Office;
Access to a Fax and/or scanner at the Tewantin Office;
Any other administrative necessities, which Council resolves, are necessary to meet the
business of Council.
Councillors are expected to comply with the same conditions of use, guidelines and processes for
business and communication tools that apply to employees.
9 Safety Equipment
Council will provide to Councillor necessary safety equipment for use on official business as and
when required.
Noosa Council Page 5 of 7
Section 89
STRATEGIC POLICY – COUNCILLORS’ EXPENSES REIMBURSEMENT POLICY
10 Vehicles
10.1 Use of Council provided vehicles on Council business
Councillors will have access to a suitable Council vehicle for Council business if required. A
Councillor wishing to use a Council vehicle for Council business must submit a request to the Chief
Executive Officer at least two (2) days prior to use, except in exceptional circumstances as
determined between the Councillor and Mayor or Chief Executive Officer. Access is subject to
availability.
This is for situations where a Councillor’s own vehicle isn’t immediately available and they have to
travel on Council business over long distances.
10.2 Private use of Council Vehicles
The use of Council vehicles for private use is only available in emergency situations and the cost of
such usage shall be at the applicable ATO rate for the vehicle size.
10.3 Fuel Costs
All fuel used in a Council owned vehicle on official Council business will be provided or paid for by
Council.
11 Home Office and Telecommunication needs – Consumables, Mobile Phones and
Tablets
To enable Councillors to communicate effectively, Councillors will receive an allowance of $240
per month to purchase communications devices and plans as well as printer consumables for their
residences.
12 Insurance Cover
Councillors will be covered under relevant Council insurance policies while on Council business.
Specifically, insurance cover will be provided for public liability, professional indemnity, Councillors
liability and personal accident, and overseas travel.
Council will pay the excess for injury claims made by a Councillor resulting from the conduct of
official Council business and on any claim made under insurance cover.
Council will cover costs incurred through injury, investigation, hearings or legal proceedings into
the conduct of a Councillor, or arising out of, or in connection with the Councillors performance of
his/her civic functions. When it has been found that the Councillor breached the provisions of the
Local Government Act 2009, the Councillor will reimburse Council with all associated costs
incurred by Council.
13 Limit
Council may by resolution reduce or limit benefits receivable under this policy.
Noosa Council Page 6 of 7
Section 90
STRATEGIC POLICY – COUNCILLORS’ EXPENSES REIMBURSEMENT POLICY REVIEW OF POLICY This policy will be reviewed when any of the following occur: 1. The related documents are amended or replaced. 2. Other circumstances as determined from time to time by a resolution of Council Notwithstanding the above, this policy is to be reviewed within six months of each quadrennial election. RELEVANT LEGISLATION Local Government Regulation 2012 Local Government Act 2009 Version control: Version Reason/ Trigger Change (Y/N) Endorsed/ Reviewed by Date 2.0 Amendments and new template Y Council 26/06/2014 1.0 Create new N Council 02/01/2014 Noosa Council Page 7 of 7