2019-07-09 Services & Organisation Committee Agenda

SERVICES & ORGANISATION COMMITTEE MEETING AGENDA      9 JULY 2019


                                                   Attachment 1




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SERVICES & ORGANISATION COMMITTEE MEETING AGENDA                                                          9 JULY 2019

                                                                                                    Attachment 1

 QTC’s Local Government Credit Rating and Outlook Definitions

                  The local government's capacity to meet its financial commitments in the short, medium and long-term is
  every           very strong. This capacity is very unlikely to be affected by adverse changes in general business and
  Strong          economic conditions including unforeseen financial shocks. it is also very unlikely to be affected by adverse
                  changes to its business and operating environment. The capacity to manage core business risks is very
                  strong.
                  The local government's capacity to meet its financial commitments in the short, medium and long-term is
  © Strong        strong. This capacity is not likely to be affected by adverse changes in general business and economic
                  conditions including unforeseen financial shocks. It is also not likely to be affected by adverse changes to its
                  business and operating environment. The capacity to manage core business risks is strong.
                  The local government's capacity to meet its financia! commitments in the short, medium and long-term is
   ® Sound        sound. This capacity may be more vulnerable to adverse changes in general business and economic
                  conditions including unforeseen financial shocks. It may also be more vulnerable to adverse changes to its
                  business and operational environment. The capacity to manage core business risks is sound.
                  The local government's capacity to meet its financial commitments is moderate in the short to medium-term
                  but is at an acceptable level in the long-term. This capacity may be weakened by adverse changes in general
  » Moderate      business and economic conditions including unforeseen financial shocks. It may also be weakened by
                  adverse changes to its business and operational environment. The capacity to manage core business risks is
                  moderate.
                  The local government's capacity to meet its financial commitments is weak in the short to medium-term and
                  remains limited in the long-term. This capacity is likely to be weakened by adverse changes in general
  © Weak          business and economic conditions including unforeseen financial shocks. It is also likely to be weakened by
                  adverse changes to its business and operational environment. The capacity to manage core business risks is
                  weak.
                  The local government's capacity to meet its financial commitments is very weak in the short to medium-
                  term, and is very limited in the jong-term. This capacity is very likely to be impaired by adverse changes in
  © Very Weak     general business and economic conditions including unforeseen financial shocks. It is also very likely to be
                  impaired by adverse changes to its business and operational environment. The rating also indicates that the
                  local government may experience difficulties in managing its core business risks and may need assistance
                  from higher levels of government.
                  The local government has no capacity to meet its financial commitments in the short, medium and long-
                  term. It has no capacity to withstand adverse changes in general business and economic conditions including
  @ Distressed    unforeseen financial shocks. It also has no capacity to withstand adverse changes to its business and
                  operating environment. The local government is unlikely to have the capacity to manage core business risks
                  and may need structural reforms and assistance from higher levels of government.

                  Existing financial performance is consistent with the assigned rating. There are no known foreseeable events
  Neutral         that would have a direct impact on the local government's capacity to meet its financial commitments.
                  There is a low likelihood of a rating change over a one to two year period.
                  As aresult of a foreseeable event or circumstance occurring, there is the potential for enhancement in the
     tgs          local government’s capacity to meet its financial commitments (short and/or long-term). Such enhancement
  Positive                   .          ws      .                           .             :
                  may result in a change in its rating over a one to two year period. However, it does not necessarily indicate
                  that a rating change may be forthcoming.
                  As arresult of a foreseeable event or circumstance occurring, there is the potential for deterioration in the
        .         local government's capacity to meet its financial commitments (short and/or long-term). Such deterioration
  Negative                                                                  .             .                  yee
                  may result in a change in its rating over a one to two year period. However, it does not necessarily indicate
                  that a rating change may be forthcoming.
                  A single or a series of potential events or circumstances have been identified which indicate heightened
 Developing       probability of a significant direct impact on the financial sustainability of the local government, the final
                  financial impact of which is uncertain. This means the rating may be raised, lowered or affirmed over the
                  following one to two years.

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