2015-06-01 General Committee Agenda

GENERAL COMMITTEE MEETING AGENDA                                                    1 JUNE 2015



6    QUEENSLAND TREASURY CORPORATION (QTC) FINANCIAL SUSTAINABILITY
     REVIEW
Author            Director Corporate Services, Michael Shave
                  Corporate Services Department

Index             ECM / Subject / Financial Management / Accounting | Loans - Queensland
                  Treasury Corporation

Attachments       1.   QTC Rating Scale


EXECUTIVE SUMMARY
Not applicable.


RECOMMENDATION
That Council note the report by the Director Corporate Services to the General Committee
Meeting dated 1 June 2015 detailing the outcomes of the Queensland Treasury Corporation
(QTC) financial sustainability review of Council’s long term financial plan and request the CEO to
make a copy of the QTC report available on Council’s website.




REPORT
The Department of Infrastructure, Local Government and Planning requested Queensland
Treasury Corporation (QTC) to undertake credit reviews for 19 Queensland local governments
during the 2014/15 financial year including the four de-amalgamated Councils. These credit
reviews are undertaken to assess each Council’s capacity to service current and proposed
borrowings (i.e. debt), as well as to assess credit and other risks which may affect a Council’s
financial sustainability into the future.

When QTC undertakes these reviews they use a number of approaches to assess the financial
capacity of a Council, namely:

1. Consideration of qualitative factors (i.e. Council strategy, demographics, economics,
   regulation, systems) and quantitative factors (i.e. historical financial results, current year
   budget versus actual results, 10 year financial forecasts and assumptions);

2. Identification and assessment of key risks and mitigation strategies; and

3. Consideration of the results of previous credit reviews undertaken.

QTC uses a scale to provide a rating and outlook for a Council once a credit review is completed.
This scale with detailed definitions is provided for information in Attachment 1. Briefly however
the scales used are as follows:




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