Cr Ros Heit - Finance Portfolio Report - 15 February 2017

Financial Report

The financial statements are as at the 28 February 2017.

The financial ratios for cash, operating cash and working capital are all within the industry guide. These ratios increased from the January results mainly on account of the receipt of the third (3rd) quarter Financial Assistance Grant (FAG) amounting to $1.7 Million and the sixty percent (60%) upfront payment for the Works for Queensland Grant amounting to $2.6 Million. 

The funded long term liabilities ratio also increased as compared to the January results but is still below the target.  This ratio is expected to further increase upon collection of the final six-monthly rating which was levied on 20 February with discount date on 28 March.

With regard to the Comprehensive Income Statement

The rates revenue budget has been achieved with the recognition of the final rates levy for the year. 

Fees and charges, rental income, interest received and other income are all within the revenue budget.  The sales revenue variance is a result of the difference between the allocation of budgeted revenue over the financial year as compared to the actual completion and submission of claims for Road Maintenance Performance Contract (RMPC) projects. 

The receipt of the 3rd Quarter Financial Assistance Grant amounting to $1.7 Million accounts for the 76% achievement of the budgeted revenue for operating grants.

The capital revenue budget will be revised in the 3rd Quarter Operating Budget Review to consider the 60% upfront payment received by Council for the Work for Queensland Grant. 

In terms of expenditures, employee benefits; materials and services; finance costs and depreciation are within budget limits.

Capex Report

Actual capital expenditure as at the 28th of February amounts to $13,286,675 which is equivalent to 42% of the 2016-2017 revised capex budget.  The total actual and year-to-date commitments for capital expenditure amount to $19,434,108 or 61% of the total capital expenditure budget for the year.

Sale of Land for Overdue Rates

A review of the outstanding rates established the list of properties with three (3) or more year’s overdue rates.  As part of Council’s debt recovery process and in accordance with the provisions of Section 140 of the Local Government Regulation 2012, it is recommended that Council resolve to sell the land for the overdue rates that have remain unpaid for three (3) or more years and no action has been taken by the owner to enter into a payment arrangement to settle the rate or charges within an acceptable time frame.

Third (3rd) Quarter Operating and Capital Budget Review

The operating budget packs for the Third (3rd ) Quarter Review has been released to the budget managers for finalisation and submission to Finance by the 21st of March.  The capex budget review was also distributed to the respective budget managers and the submission to Finance of their proposed revisions is on the 17th of March.

The proposed third (3rd) quarter opex and capex budget revisions will be presented for Council’s consideration at the April 2017 general meeting.

External Audit – key engagement milestones

The External Auditors will commence the annual interim audit on the 18th of April and an interim management letter will be provided to Council by 28 April. 

The final audit visit will commence on the 4th of September and the 6th of October is the target date for the Queensland Audit Office (QAO) certification of the 2016-2017 consolidated financial statements.