Annual Report 2023-24

      An overview of each ratio, together with commentary on Council’s performance for the current financial year is




                                                                                                                                                                                                                                                                              Financial Performance
      provided below



      Council Controlled Revenue Ratio                                                                                                   Asset Sustainability Ratio

                                           Council-controlled revenue is an indicator of a council’s financial flexibility, ability to                                    The asset sustainability ratio approximates the extent to which the infrastructure assets
       Net Rates, Levies and Charges
                                           influence its operating income, and capacity to respond to unexpected financial shocks.                                        managed by a council are being replaced as they reach the end of their useful lives.
       add Fees and Charges
                                                                                                                                          Capital Expenditure on
                                                                                                                                          Replacement of Infrastructure
       Total Operating Revenue             Council has a moderate to strong capacity to generate its own operating revenues,                                              Council prioritises the renewal of its existing assets in line with Asset Management
                                                                                                                                          Assets (Renewals)
                                           demonstrating financial flexibility and the ability to influence its operating income. This                                    principles to ensure service potential is maintained, before investment in the construction
                                           positions Council well to respond effectively to unexpected financial challenges.                                              of new assets.
                                                                                                                                          Depreciation Expenditure on
                                                                                                                                          Infrastructure Assets
                                                                                                                                                                          Renewal expenditure from QRA Disaster funded projects has been excluded from the
      Population Growth
                                                                                                                                                                          calculation of this ratio to eliminate any distortion of the ratio
                                           Population growth is a key driver of a council’s operating income, service needs, and
       Prior Year Estimated                infrastructure requirements into the future.                                                  Asset Consumption Ratio
       Population
                                      -1   Population growth is positive but relatively low which means Council may have less             Written down replacement        This ratio approximates the extent to which council’s infrastructure assets have been
       Previous Year Estimated             opportunities to generate operating revenue through an increasing rateable property            cost of Depreciable             consumed compared to what it would cost to build a new asset with the same benefit to
       Population                                                                                                                         Infrastructure Assets)
                                           base and over time may need to develop alternative revenue sources and adjust service                                          the community.
                                           levels and infrastructure spending accordingly.
                                                                                                                                          Current replacement
                                                                                                                                          cost of Depreciable             Council is investing sufficiently in the renewal of its existing assets to ensure service levels
      Operating Surplus Ratio                                                                                                             Infrastructure Assets           to the community are maintained.

                                           Council should be aiming to achieve as a minimum a balanced operating position to
                                           ensure that revenues received are sufficient to fund operations and capital replacement       Asset Renewal Ratio
200                                        works. A surplus will be represented by a positive result.                                                                                                                                                                         201
       Operating Result
                                                                                                                                          Total of Planned Capital
                                                                                                                                          Expenditure on Infrastructure   The asset renewal funding ratio measures the ability of a council to fund its projected
       Total Operating Revenue             The 2023/24 operating surplus ratio of 5.31% is a reflection of consistent revenue growth      Asset Renewals over 10 years)   infrastructure asset renewal/replacements (as outlined in its asset management plans) in
                                           along with good management of our expenditure. The forecast shows Council’s ongoing                                            the future.
                                           commitment to strong financial management.                                                     Total of Required Capital
                                                                                                                                          Expenditure on Infrastructure   This ratio is not required to be reported until the 2024/25 financial year.
      Operating Cash Ratio                                                                                                                Asset Renewals over 10 years

                                           The operating cash ratio is a measure of a council’s ability to cover its core operational    Leverage Ratio
       Operating Result add                expenses and generate a cash surplus excluding depreciation, amortisation, and finance
       Depreciation and Amortisation
                                           costs.                                                                                                                         The leverage ratio is an indicator of a council’s ability to repay its existing debt. It measures
       and Finance Costs
                                                                                                                                          Book value of Debt              the relative size of the council’s debt to its operating performance.
       Total Operating Revenue             Council is generating sufficient revenues to fund its operational expenditure requirements,
                                           while also providing cash flow to support capital expenditure renewal requirements.                                            Council has capacity to support additional borrowings due to its manageable debt levels
                                                                                                                                          Total Operating Revenue less
                                                                                                                                          total Operating Expenditure     compared to its operational performance. Borrowings are predominantly directed toward
      Unrestricted Cash Expense Cover Ratio                                                                                               add Depreciation and            long-term infrastructure or revenue-generating projects, where alternate funding sources
                                                                                                                                          Amortisation                    have been exhausted as well as giving consideration to inter-generational equity and
                                                                                                                                                                          Council’s ongoing financial sustainability.




                                                                                                                                                                                                                                                                              Noosa Council Annual Report 23/24
       (Total Cash and Equivalents         The unrestricted cash expense cover ratio is an indicator of the unconstrained liquidity
       add Current Investments             available to a council to meet ongoing and emergent financial demands, which is a key
       add Available Ongoing QTC           component to solvency. It represents the number of months a council can continue
       Working Capital Facility Limit      operating based on current monthly expenses.
       less Externally Restricted Cash)

                                           Council’s cash position is strong with the majority of restricted cash being internally
       x 12
                                           restricted and therefore available to cover emergent expenditure if required. Internally
       (Total Operating Expenditure less
       Depreciation and Amortisation       restricted cash also includes reserves to fund the carryover and completion of Council’s
       less Finance Costs)                 capital works program.