2022-08-15 General Committee Meeting Agenda

GENERAL COMMITTEE MEETING AGENDA                                                                                                                                                                 15 AUGUST 2022


Measures of Financial Sustainability
The following table incorporates a set of financial sustainability indicators to further assist in
managing Council financial performance. There are no current emerging risks regarding
performance noting the early stage of the financial year.

 Category                                                                                                                                                                           Comments
 Operating Surplus Ratio                                                                                                                                                            • Intent: Identifies the extent to
                                                                                                                                                                                      which       revenues      cover
                                                                                                                                                                                      operational     expenses,     to
                                                                                                                                                                                      ensure community equity is not
                                                                                                                                                                                      degraded
                                                                                                                                                                                    • Target: 0 – 10%
                                                                                                                                                                                    • Result: 81.4%
                                                                                                                                                                                    • Comment: The high ratio
                                                                                                                                                                                      reflects the levying of rates in
                                                                                                                                                                                      July, which will degrade as
                                                                                                                                                                                      expenditure       occurs     on
                                                                                                                                                                                      operations through the financial
                                                                                                                                                                                      year to 30 June 2023.

 Cash Expense Cover                                                                                                                                                                 • Intent: Indicates how long
                                      16.0                                                                                                                                            council can continue paying its
                                                                                                          14.2
                                                                                                                     13.4 13.0                                                        day-to-day expenses from cash
  Months (Cash to Cover Operations)




                                      14.0   12.8 12.5                                                                                               13.1
                                                                                                                                          12.4
                                                                  11.9 11.8                                                                                     11.8                  at bank without needing
                                      12.0                                            10.8 11.2
                                                                                                                                                                                      additional cash flows
                                      10.0
                                                                                                                                                                                    • Target: > 3 months
                                                                                                                                                                                    • Result: 11.8 months
                                       8.0
                                       6.0
                                                                                                                                                                                    • Comment: Whilst current cash
                                       4.0                                                                                                                                            cover remains above target,
                                       2.0                                                                                                                                            business as usual expenditure
                                        -           -         -         -         -         -         -          -          -         -          -          -          -              through to 30 June 2023 will
                                             Aug        Sep       Oct       Nov       Dec       Jan       Feb        Mar        Apr       May        Jun        Jul                   degrade      Council’s    cash
                                                        Actual                                                             Minimum (>0 months)                                        holdings, albeit not below the
                                                        Target (3 months)                                                  Maximum (6 months)                                         target range of 3 – 6 months.
                                                                                                                                                                                       Cash balances are also
                                                                                                                                                                                       enhanced with FAG and Waste
                                                                                                                                                                                       Levy subsidy prepayments
                                                                                                                                                                                       (held as restricted cash)

 Asset Sustainability Ratio                                                                                                                                                         • Intent: Measures the extent to
                                      160%                                                                                                                                 151.6%     which     assets    are    being
                                                                                                                                                                                      replaced as their condition
                                      140%
                                                                                                                                                                                      degrades to ensure service
                                      120%                                                                                                                                            potential is maintained
                                      100%                                                                                                                                          • Target: 90% of depreciation
                                                                                                                                                                             90%      budget spent on renewals
                                       80%
                                                                                                                                                                                      annually
                                       60%
                                                                                                                                                                                    • Result: In line with budget
                                       40%
                                                                                                                                                                                    • Comment:         The      capital
                                       20%   10.7%                                                                                                                                    program      has     only    just
                                        0%                                                                                                                                            commenced. It is expected that
                                              Jul        Aug       Sep        Oct       Nov       Dec           Jan        Feb        Mar        Apr            May        Jun        the ratio will progressively
                                                                                                                                                                                      increase each month as
                                                   Actual Renewal Spend (%)                                 Target (%)                       Renewals Budget (%)
                                                                                                                                                                                      expenditure      on    renewals
                                                                                                                                                                                      occurs.



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