2023-03-13 General Committee Meeting Agenda

GENERAL COMMITTEE MEETING REPORT                                                     13 MARCH 2023


 Category                                                    Comments
 Net Financial Liabilities Ratio                              Intent: Outlines the level that net
                                                               Council debt can be serviced by
                                                               operating revenues. A ratio below zero
                                                               implies that liabilities are less than cash
                                                               (and other current assets) and there is
                                                               adequate borrowing capacity available
                                                               if needed.
                                                              Target: less than 60%
                                                              Result: -49.6%
                                                              Comment: Council has low debt levels
                                                               and strong cash holdings. The January
                                                               rates revenue also inflates the YTD
                                                               actual outcome.
 Investment Return                                            Intent: Ensure appropriate return on
                                                               investment yield for cash at bank.
                                                              Target: 0.25% above current
                                                               Bloomberg commonwealth 10-year
                                                               bond rate yield (3.08%)
                                                              Result: 3.28%
                                                              Comment: With bond rates rising,
                                                               Council has invested surplus cash in
                                                               higher yielding term deposits to
                                                               maximise returns. Council’s investment
                                                               returns when averaged are showing
                                                               slightly under target for the month due
                                                               to the significant increase in cash
                                                               holdings from the second rates run
                                                               received later in February.
 Rates in Arrears                                             Intent: Ensuring that the amount of
                                                               unpaid rates remains sustainable and
                                                               does not negatively impact cash flows
                                                              Target: 5% industry benchmark
                                                              Result: 10.7%
                                                              Comment: Rates arrears are at its bi-
                                                               annual peak following the due date for
                                                               the January rates issue. This ratio will
                                                               continue to decline from the high point
                                                               in the cycle as payments are received.
                                                               Recovery action may be considered
                                                               where appropriate.


Previous Council Consideration
Nil.
Finance
As above.
Risks & Opportunities
Council’s risk register identifies a number of risks that could impact on its ongoing financial
sustainability. In order to manage and mitigate these risks Council uses various tools which include
monthly ongoing financial reporting to identify and address emerging issues, conservative
budgeting, compliance with the Financial Sustainability Policy, regular budget reviews, effective
liquidity management to ensure sufficient fiscal flexibility, as well as adhering to the Reserves and


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