2019-08-12 General Committee Agenda

GENERAL COMMITTEE MEETING AGENDA                                                12 AUGUST 2019


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: -7.0% budget
                                                           Comment: Council has low debt
                                                             levels and strong cash holdings. The
                                                             July 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 (1.4%)
                                                           Result: 2.1%
                                                           Comment: Regardless of the decline
                                                             in long term bond rates (due to
                                                             international market factors), Council’s
                                                             investment return still remains well
                                                             above target
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: 5.8%
                                                           Comment: At the low point in the
                                                             cycle and will increase again in August
                                                             as the July rates become due
                                                             following discount close




Previous Council Consideration
Nil.

Finance
As above.

Risks & Opportunities
Council’s risk register includes a number of risks that could impact on ongoing financial
sustainability. Effective budget management and reporting is an important risk mitigation tool.




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