31dfa1d2-3224-4dd7-a957-281a51cc7802

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.

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