2014-01-13 Item 6.3 Appendices 1-5

3.3.1 Cash and cash equivalents

   Unrestricted cash: QTC has allocated to the Proponent Council the unrestricted cash as
    at 30 June 2012 based on its pre-amalgamation proportion and then added back the
    proportion of cash backed reserves as at 30 June 2012 that were attributable to the
    Proponent Council.

    Cross check: QTC cross checked this methodology for reasonableness by estimating the
     opening cash balances of the Remaining Council and the Proponent Council based on a
     reconstruction of the cash flows during the period since amalgamation. This involved
     assumptions around:
    – receipts from customers
    – payments to suppliers and employees
    – payments for property, plant and equipment including subsidies, donations and
       contributions for new capital expenditure, and
    – proceeds from and repayments of borrowings.

3.3.2 Property, plant and equipment

   QTC has relied on information from the Existing Council for the allocation of the
    property, plant and equipment, which has been allocated on geographic location. QTC has
    allocated to the Proponent Council, the closing written down value of the assets based on
    the assets located in Divisions 11 and 12 as advised by SCRC.

3.3.3 Debt

   QTC has allocated borrowings since amalgamation to the Remaining Council and the
    Proponent Council in the same proportion as the capital expenditure in their respective
    areas. Redemptions over the same period are assumed to have occurred in the same
    proportion as the opening debt balances at the time of amalgamation. The opening balance
    for the Proponent Council is based on the proportion of debt at date of amalgamation,
    taking into account the debt split for the transfer of bulk water assets.




De-amalgamation Analysis of Sunshine Coast Regional Council                            Page 20