Annual Report 2019-20

Noosa Shire Council

Notes to the Financial Statements
for the year ended 30 June 2020

Note 26. Superannuation

Council contributes to the LGIAsuper Regional Defined Benefits Fund (the scheme), at the rate of 12% for each
permanent employee who is a defined benefit member. This rate is set in accordance with the LGIAsuper trust deed
and may be varied on the advice of an actuary. The Regional Defined Benefits Fund is a complying superannuation
scheme for the purpose of the Commonwealth Superannuation Industry (Supervision) legislation and is also
governed by the Local Government Act 2009.

The scheme is a defined benefit plan, however Council is not able to account for it as a defined benefit plan in
accordance with AASB119 because LGIAsuper is unable to account for its proportionate share of the defined
benefit obligation, plan assets and costs.

Any amount by which the scheme is over or under funded may affect future benefits and result in a change to
the contribution rate, but has not been recognised as an asset or liability of the Council.

Technically Council can be liable to the scheme for a portion of another local governments’ obligations should that
local government be unable to meet them. However the risk of this occurring is extremely low and in accordance
with the LGIAsuper trust deed changes to council's obligations will only be made on the advice of an actuary.

The last completed actuarial assessment of the scheme was undertaken as at 1 July 2018. The actuary indicated
that “At the valuation date of 1 July 2018, the net assets of the scheme exceeded the vested benefits and the
scheme was in a satisfactory financial position as at the valuation date." The Council is not aware of anything
that has happened since that time that indicates the assets of the scheme are not sufficient to meet the vested
benefits, as at the reporting date.

No changes have 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.

The next triennial actuarial review is not due until 1 July 2021.

The most significant risks that may result in LGIAsuper increasing the contribution rate, on the advice of the
actuary, are:

Investment risk - The risk that the scheme's investment returns will be lower than assumed and additional
contributions are needed to fund the shortfall.
Salary growth risk - The risk that wages or salaries will rise more rapidly than assumed, increasing vested
benefits to be funded.

                                                                                               2020              2019
                                                                                 Notes         $'000             $'000


Superannuation contributions made to the Regional Defined Benefits Fund                          201               213
Other superannuation contributions for employees                                               3,225             3,062
Total superannuation contributions paid by Council for employees                  5           3,426           3,275




                                                                                                          page 42