Annual Report 2016-17

                                                                                             Financial Statements 2017



Noosa Shire Council

Notes to the Financial Statements
for the year ended 30 June 2017

Note 27. Financial Instruments (continued)



Market Risk

Market risk is the risk that changes in market prices, such as interest rates, will affect the Council's income or the
value of its holdings of financial instruments.

Interest Rate Risk

Noosa Shire Council is exposed to interest rate risk through investments and borrowings with Queensland Treasury
and/or other financial institutions.

It also has access to a mix of variable and fixed rate funding options through QTC so that interest rate
risk exposure can be minimised.

Sensitivity
Sensitivity to interest rate movements is shown for variable financial assets and liabilities based on the carrying
amount at reporting date.

The following interest rate sensitivity analysis depicts what effect a reasonably possible change in interest rates
(assumed to be 1%) would have on the profit and equity, based on the carrying values at the end of the reporting
period. The calculation assumes that the change in interest rates would be held constant over the period.

                                        Net Carrying                 Net Result                       Equity
                                           Amount           1% increase     1% decrease     1% increase 1% decrease
                                            $'000              $'000            $'000          $'000         $'000


2017
QTC Cash Fund                                34,896                 349             (349)           349                    (349)
Other Investments                            12,419                 124             (124)           124                    (124)
Loans- QTC                                 ...(38,q3_?).           ~~9).             380     - ___ (~~9>.                   380
Net Total                                     9,280                 93              (93)             93                    (93)

2016
QTC Cash Fund                                28,165                 282             (282)           282                    (282)
Other Investments                            10,303                 100             (100)           100                    (100)
Loans- QTC                                  ,(~~~~ ~.9)_           (~~1).            381           (3.8.1)                  381
Net Total                                       349                    1              (1)              1     -        -      (1)

In relation to the QTC loans held by the Council, the following has been applied:

QTC Generic. Debt Pool- the generic debt pool products approximate a fixed rate loan. There is a negligible impact
on interest sensitivity from changes in interest rates for generic debt pool borrowings.




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