2014-01-13 Item 6.3 Appendices 1-5

 Diseconomies of scale for Proponent Council: It is assumed that the two smaller entities
  would be subject to reduced economies of scale compared to the Existing Council. QTC
  has included a recurring cost relating to diseconomies of scale equal to 2.5 per cent of the
  annual materials and services expense for the Remaining Council and 3.0 per cent for the
  Proponent Council. This also incorporates increased costs related to Insurance.


3.3        Proposed balance sheet separation
Table 12 shows the opening balance sheet for the Existing Council, and estimates of what
would become the opening balance sheet for the Proponent Council and Remaining Council if
de-amalgamation were to proceed.

TABLE 12 – SUMMARY BALANCE SHEET ALLOCATION
                                        Existing       Remaining   Proponent
                                        Council          Council      Council
Assets ($000)

Cash & cash equivalents                 238,978         188,216      50,762
 Property, plant & equipment          4,017,225        3,118,526    898,699

 Other assets                         1,270,573        1,144,007    126,566

Total assets                          5,526,776        4,450,749   1,076,027

Liabilities ($000)
Debt                                    231,201         188,990      42,211

 Other liabilities                      124,090         106,693      17,397

Total liabilities                       355,291          295,683      59,608

 Total community equity               5,171,485        4,155,066   1,016,419



QTC has estimated an opening balance sheet as at 1 July 2012 for the Remaining Council and
Proponent Council based on the FY2012 unaudited Balance Sheet for the Existing Council
(see Appendix 2). QTC has referenced information provided by both the Proponent Council
and Existing Council to determine the estimated opening Balance Sheet.

Discussion on key Balance Sheet items follows.




De-amalgamation Analysis of Sunshine Coast Regional Council                            Page 19