2020-01-13 General Committee Agenda

GENERAL COMMITTEE MEETING AGENDA                                                13 JANUARY 2020


Measures of Financial Sustainability
The following table incorporates a set of financial sustainability indicators to further assist in
managing Council financial performance. There are no current material emerging risks regarding
performance for the first half of the financial year.

Category                                                        Comments
Operating Surplus Ratio                                            Intent: Identifies the extent to
                                                                     which revenues cover
                                                                     operational expenses, to ensure
                                                                     community equity is not
                                                                     degraded
                                                                   Target: 0 – 10%
                                                                   Target Date: 30 June
                                                                   Result: 4.7%
                                                                   Comment: The ratio is at the
                                                                     low point in the cycle and is
                                                                     tracking above budget levels.
                                                                     The ratio will again increase
                                                                     once the January rates are
                                                                     levied.

Cash Expense Cover                                                 Intent: Indicates how long
                                                                     council can continue paying its
                                                                     day-to-day expenses from cash
                                                                     at bank without needing
                                                                     additional cash flows
                                                                   Target: > 3 months
                                                                   Target Date: Ongoing
                                                                   Result: 8.4 months
                                                                   Comment: Council is forecast
                                                                     to remain above target for the
                                                                     financial year and remain
                                                                     fiscally flexible to accommodate
                                                                     unforeseen events. Peaks will
                                                                     occur following rating periods

Asset Sustainability Ratio                                         Intent: Measures the extent to
                                                                     which assets are being replaced
                                                                     as their condition degrades to
                                                                     ensure service potential is
                                                                     maintained
                                                                   Target: 90% of depreciation
                                                                     budget spent on renewals
                                                                     annually
                                                                   Target Date: 30 June
                                                                   Result: In line with budget
                                                                   Comment: The ratio has been
                                                                     revised at Budget Review 2 with
                                                                     the revised capital works
                                                                     budget. The actual result will
                                                                     progressively increase each
                                                                     month as expenditure on
                                                                     renewal projects occurs.




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