Financial statements 2012 2013 by Moree Plains Shire Council

Financial Statements 2013

Moree Plains Shire Council General Purpose Financial Statements for the financial year ended 30 June 2013

Contents

Page

1. Understanding Council's Financial Statements

2. Statement by Councillors & Management

3. Primary Financial Statements: - Income Statement - Statement of Comprehensive Income - Statement of Financial Position - Statement of Changes in Equity - Statement of Cash Flows

4 5 6 7 8

4. Notes to the Financial Statements

5. Independent Auditor's Reports: - On the Financial Statements (Sect 417 [2]) - On the Conduct of the Audit (Sect 417 [3])

78 80

Overview (i)

These financial statements are General Purpose Financial Statements and cover the consolidated operations for Moree Plains Shire Council.

(ii)

Moree Plains Shire Council is a body politic of NSW, Australia - being constituted as a Local Government area by proclamation and is duly empowered by the Local Government Act (LGA) 1993 of NSW. Council's Statutory Charter is detailed in Paragraph 8 of the LGA and includes giving Council; ď Š the ability to provide goods, services & facilities, and to carry out activities appropriate to the current & future

needs of the local community and of the wider public, ď Š the responsibility for administering regulatory requirements under the LGA and ď Š a role in the management, improvement and development of the resources in the area.

A description of the nature of Council's operations and its principal activities are provided in Note 2(b). (iii)

All figures presented in these financial statements are presented in Australian Currency.

(iv)

These financial statements were authorised for issue by the Council on 30 October 2013. Council has the power to amend and reissue these financial statements.

page 1

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Understanding Council's Financial Statements Introduction

5. The Statement of Cash Flows

Each year, individual Local Governments across NSW are required to present a set of audited financial statements to their Council & Community.

Indicates where Council's cash came from and where it was spent.

What you will find in the Statements The financial statements set out the financial performance, financial position & cash flows of Council for the financial year ended 30 June 2013. The format of the financial statements is standard across all NSW Councils and complies with both the accounting & reporting requirements of Australian Accounting Standards and requirements as set down by the NSW Division of Local Government.

About the Councillor/Management Statement The financial statements must be certified by Senior staff as "presenting fairly" the Council's financial results for the year, and are required to be adopted by Council - ensuring both responsibility for & ownership of the financial statements.

About the Primary Financial Statements The financial statements incorporate 5 "primary" financial statements: 1. The Income Statement Summarises Council's financial performance for the year, listing all income & expenses. This statement also displays Council's original adopted budget to provide a comparison between what was projected and what actually occurred. 2. The Statement of Comprehensive Income Primarily records changes in the fair values of Council's Infrastructure, Property, Plant & Equipment.

This statement also displays Council's original adopted budget to provide a comparison between what was projected and what actually occurred.

About the Notes to the Financial Statements The Notes to the financial statements provide greater detail and additional information on the 5 primary financial statements.

About the Auditor's Reports Council's financial statements are required to be audited by external accountants (that generally specialize in Local Government). In NSW, the Auditor provides 2 audit reports: 1. An opinion on whether the financial statements present fairly the Council's financial performance & position, & 2. Their observations on the conduct of the Audit including commentary on the Council's financial performance & financial position.

Who uses the Financial Statements ? The financial statements are publicly available documents & must be presented at a Council meeting between 7 days & 5 weeks after the date of the Audit Report. Submissions from the public can be made to Council up to 7 days subsequent to the public presentation of the financial statements.

3. The Statement of Financial Position

Council is required to forward an audited set of financial statements to the Division of Local Government.

A 30 June snapshot of Council's financial position indicating its Assets, Liabilities & â&#x20AC;&#x153;Net Wealthâ&#x20AC;?.

More information

4. The Statement of Changes in Equity The overall change for the year (in dollars) of Council's "Net Wealth".

A review of Council's financial performance and position for the 12/13 financial year can be found at Note 27 of the financial statements.

page 2

Financial Statements 2013

Moree Plains Shire Council Income Statement for the financial year ended 30 June 2013 Budget 2013

(1)

Actual 2013

Actual 2012

25,017 13,358 2,279 1,193 36,372 2,349

23,309 11,434 946 901 18,456 354

80,568

55,400

17,227 2,625 39,407 11,317 3,218 299

15,695 2,624 21,718 11,395 2,739 408

74,093

54,579

6,475

821

6,475

821

Net Operating Result attributable to Council Net Operating Result attributable to Non-controlling Interests

6,475 -

821 -

Net Operating Result for the year before Grants and Contributions provided for Capital Purposes

4,126

467

$ '000

Notes

Income from Continuing Operations 25,312 9,676 1,101 910 33,854 1,731

Revenue: Rates & Annual Charges User Charges & Fees Interest & Investment Revenue Other Revenues Grants & Contributions provided for Operating Purposes Grants & Contributions provided for Capital Purposes

72,584

Total Income from Continuing Operations

3a 3b 3c 3d 3e,f 3e,f

Expenses from Continuing Operations 17,223 2,682 36,283 10,229 2,963 1,500 -

Employee Benefits & On-Costs Borrowing Costs Materials & Contracts Depreciation & Amortisation Impairment Other Expenses Net Losses from the Disposal of Assets Net Share of interests in Joint Ventures & Associated Entities using the equity method

70,880

Total Expenses from Continuing Operations

1,704

4a 4b 4c 4d 4d 4e

Operating Result from Continuing Operations Discontinued Operations

Net Profit/(Loss) from Discontinued Operations

1,704

Net Operating Result for the Year

1,704 -

(27)

(1) Original Budget as approved by Council - refer Note 16

This Statement should be read in conjunction with the accompanying Notes.

page 4

Financial Statements 2013

Moree Plains Shire Council Statement of Comprehensive Income for the financial year ended 30 June 2013

$ '000

Notes

Net Operating Result for the year (as per Income statement)

Actual 2013

Actual 2012

6,475

821

Other Comprehensive Income: Amounts which will not be reclassified subsequently to the Operating Result Gain (loss) on revaluation of I,PP&E Impairment (loss) reversal relating to I,PP&E Total Items which will not be reclassified subsequently to the Operating Result

20b (ii) 20b (ii)

32,420 23,904

2,246 (31,831)

56,324

(29,585)

56,324

(29,585)

62,799

(28,764)

62,799 -

(28,764) -

Amounts which will be reclassified subsequently to the Operating Result when specific conditions are met Nil

Total Other Comprehensive Income for the year

Total Comprehensive Income for the Year

Total Comprehensive Income attributable to Council Total Comprehensive Income attributable to Non-controlling Interests

This Statement should be read in conjunction with the accompanying Notes.

page 5

Financial Statements 2013

Moree Plains Shire Council Statement of Financial Position as at 30 June 2013

$ '000

ASSETS Current Assets Cash & Cash Equivalents Investments Receivables Inventories Other Non-current assets classified as "held for sale" Total Current Assets Non-Current Assets Investments Receivables Inventories Infrastructure, Property, Plant & Equipment Investments accounted for using the equity method Investment Property Intangible Assets Total Non-Current Assets

Notes

6a 6b 7 8 8 22

6b 7 8 9 19 14 25

TOTAL ASSETS LIABILITIES Current Liabilities Payables Borrowings Provisions Total Current Liabilities Non-Current Liabilities Payables Borrowings Provisions Total Non-Current Liabilities

10 10 10

TOTAL LIABILITIES

Net Assets

Actual 2013

Actual 2012

21,651 1,611 8,482 1,077 405 33,226

12,650 1,884 9,442 1,166 305 25,447

409,758 145 409,903

1,824 349,291 351,115

443,129

376,562

6,488 959 5,459 12,906

4,673 873 4,740 10,286

33,214 2,458 35,672

33,146 1,378 34,524

48,578

44,810

394,551

331,752

111,776 282,775 394,551 -

105,301 226,451 331,752 -

394,551

331,752

EQUITY Retained Earnings Revaluation Reserves Council Equity Interest Non-controlling Interests

Total Equity

This Statement should be read in conjunction with the accompanying Notes.

20 20

page 6

Financial Statements 2013

Moree Plains Shire Council Statement of Changes in Equity for the financial year ended 30 June 2013

$ '000

Notes

Retained Reserves Earnings (Refer 20b)

NonCouncil controlling Interest Interest

Total Equity

2013 Opening Balance (as per Last Year's Audited Accounts)

105,301

226,451

331,752

a. Correction of Prior Period Errors

20 (c)

b. Changes in Accounting Policies (prior year effects)

20 (d)

105,301

226,451

331,752

6,475

Revised Opening Balance (as at 1/7/12) c. Net Operating Result for the Year d. Other Comprehensive Income - Revaluations : IPP&E Asset Revaluation Rsve

20b (ii)

32,420

- Revaluations: Other Reserves

20b (ii)

- Transfers to Income Statement

20b (ii)

- Impairment (loss) reversal relating to I,PP&E - Other Movements (enter details here)

20b (ii)

23,904

20b (ii)

56,324

6,475

56,324

62,799

111,776

282,775

394,551

Other Comprehensive Income Total Comprehensive Income (c&d) e. Distributions to/(Contributions from) Non-controlling Interests f. Transfers between Equity

Equity - Balance at end of the reporting period

$ '000

Notes

Retained Reserves Earnings (Refer 20b)

NonCouncil controlling Interest Interest

Total Equity

2012 Opening Balance (as per Last Year's Audited Accounts)

104,480

256,036

360,516

a. Correction of Prior Period Errors

20 (c)

b. Changes in Accounting Policies (prior year effects)

20 (d)

104,480

256,036

360,516

821

Revised Opening Balance (as at 1/7/11) c. Net Operating Result for the Year

d. Other Comprehensive Income - Revaluations : IPP&E Asset Revaluation Rsve

20b (ii)

2,246

- Revaluations: Other Reserves

20b (ii)

- Transfers to Income Statement

20b (ii)

- Impairment (loss) reversal relating to I,PP&E - Other Movements (enter details here)

20b (ii)

(31,831)

20b (ii)

(29,585)

821

(29,585)

Other Comprehensive Income Total Comprehensive Income (c&d)

(31,831)

(29,585)

(28,764)

e. Distributions to/(Contributions from) Non-controlling Interests

f. Transfers between Equity

105,301

226,451

331,752

Equity - Balance at end of the reporting period

This Statement should be read in conjunction with the accompanying Notes.

page 7

Financial Statements 2013

Moree Plains Shire Council Statement of Cash Flows for the financial year ended 30 June 2013 Budget 2013

$ '000

Notes

Actual 2013

Actual 2012

25,049 14,579 991 41,124 3,987

22,980 11,118 1,198 15,136 4,700

(17,071) (42,396) (2,476) (41) (2,516)

(15,545) (23,709) (2,542) (3,035)

21,230

10,301

4,014 543

11,271 1,193

(16,940)

(1,000) (17,700)

(12,383)

(6,236)

Cash Flows from Operating Activities Receipts:

25,072 9,882 825 36,914 2,315

Rates & Annual Charges User Charges & Fees Investment & Interest Revenue Received Grants & Contributions Other Payments:

(20,073) (35,464) (2,506) (3,483)

Employee Benefits & On-Costs Materials & Contracts Borrowing Costs Bonds, Deposits & Retention amounts refunded Other

13,482

Net Cash provided (or used in) Operating Activities

11b

Cash Flows from Investing Activities Receipts:

1,032

Sale of Investment Securities Sale of Infrastructure, Property, Plant & Equipment Payments:

(16,769)

(15,737)

Purchase of Investment Securities Purchase of Infrastructure, Property, Plant & Equipment Net Cash provided (or used in) Investing Activities

Cash Flows from Financing Activities Receipts:

1,032

1,030

Proceeds from Borrowings & Advances

Payments:

(842)

Repayment of Borrowings & Advances

(876)

(807)

190

Net Cash Flow provided (used in) Financing Activities

154

(807)

(2,065)

Net Increase/(Decrease) in Cash & Cash Equivalents

16,358

plus:

14,293

9,001

3,258

Cash & Cash Equivalents - beginning of year

11a

12,650

9,392

Cash & Cash Equivalents - end of the year

11a

21,651

12,650

1,611

3,708

23,262

16,358

Additional Information: plus:

Investments on hand - end of year

Total Cash, Cash Equivalents & Investments Please refer to Note 11 for information on the following: - Non Cash Financing and Investing Activites

This Statement should be read in conjunction with the accompanying Notes.

page 8

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Contents of the Notes accompanying the Financial Statements Note

Details

Page

1 2(a) 2(b) 3 4 5 6(a) 6(b) 6(c) 7 8 9(a) 9(b) 9(c) 10(a) 10(b) 11 12 13

14 15 16 17 18 19 20

Summary of Significant Accounting Policies Council Functions / Activities - Financial Information Council Functions / Activities - Component Descriptions Income from Continuing Operations Expenses from Continuing Operations Gains or Losses from the Disposal of Assets Cash & Cash Equivalent Assets Investments Restricted Cash, Cash Equivalents & Investments - Details Receivables Inventories & Other Assets Infrastructure, Property, Plant & Equipment Externally Restricted Infrastructure, Property, Plant & Equipment Infrastructure, Property, Plant & Equipment - Current Year Impairments Payables, Borrowings & Provisions Description of (and movements in) Provisions Statement of Cash Flows - Additional Information Commitments for Expenditure Statement of Performance Measures: 13a (i) Local Government Industry Indicators (Consolidated) 13a (ii) Local Government Industry Graphs (Consolidated) 13b Local Government Industry Indicators (by Fund) Investment Properties Financial Risk Management Material Budget Variations Statement of Developer Contributions Contingencies and Other Liabilities/Assets not recognised Controlled Entities, Associated Entities & Interests in Joint Ventures Equity - Retained Earnings and Revaluation Reserves

53 55 58 60 61 66 68 69 71 n/a 71

21 22 23 24 25 26

Financial Result & Financial Position by Fund "Held for Sale" Non Current Assets & Disposal Groups Events occurring after the Reporting Period Discontinued Operations Intangible Assets Reinstatement, Rehabilitation & Restoration Liabilities

72 74 n/a 74 n/a 74 n/a 74 n/a 75

10 29 30 31 36 39 40 40 41 43 44 45 46 46 47 48 49 51

Additional Council Disclosures 27 28

Financial Review Council Information & Contact Details

76 77

n/a - not applicable

page 9

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies The principal accounting policies adopted by Council in the preparation of these consolidated financial statements are set out below in order to assist in its general understanding. Under Australian Accounting Standards (AASBs), accounting policies are defined as those specific principles, bases, conventions, rules and practices applied by a reporting entity (in this case Council) in preparing and presenting its financial statements.

(a) Basis of preparation

Under the Local Government Act (LGA), Regulations and Local Government Code of Accounting Practice & Financial Reporting, it should be noted that Councils in NSW only have a requirement to comply with AASBs. (iii) New and amended standards adopted by Council None of the new standards and amendments to standards that are mandatory for the first time for the financial year beginning 1 July 2013 affected any of the amounts recognised in the current period or any prior period and are not likely to affect future periods.

(i) Background (iv) Early adoption of Accounting Standards These financial statements are general purpose financial statements which have been prepared in accordance with; 

Australian Accounting Standards and Interpretations issued by the Australian Accounting Standards Board,

Council has not elected to apply any pronouncements before their operative date in the annual reporting period beginning 1 July 2013. Refer further to paragraph (ab) relating to a summary of the effects of Standards with future operative dates.

 the Local Government Act (1993) & Regulation, and

(v) Basis of Accounting

 the Local Government Code of Accounting Practice and Financial Reporting.

These financial statements have been prepared under the historical cost convention except for:

For the purpose of preparing these financial statements, Council has been deemed to be a notfor-profit entity.

(i)

(ii) Compliance with International Financial Reporting Standards (IFRSs) Because AASBs are sector neutral, some standards either: (a) have

local Australian content and prescription that is specific to the Not-ForProfit sector (including Local Government) which are not in compliance with IFRS’s, or

(b) specifically exclude application by Not for

financial assets and liabilities at fair value through the income statement, available-for-sale financial assets and investment properties which are all valued at fair value,

(ii) the write down of any Asset on the basis of Impairment (if warranted) and (iii) certain classes of Infrastructure, property, plant & equipment that are accounted for at fair valuation. The accrual basis of accounting has also been applied in their preparation. (vi) Changes in Accounting Policies

Profit entities. Accordingly in preparing these financial statements and accompanying notes, Council has been unable to comply fully with International Accounting Standards, but has complied fully with Australian Accounting Standards.

Council’s accounting policies have been consistently applied to all the years presented, unless otherwise stated.

page 10

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies There have also been no changes in accounting policies when compared with previous financial statements unless otherwise stated [refer Note 20(d)]. (vii) Critical Accounting Estimates The preparation of financial statements requires the use of certain critical accounting estimates (in conformity with AASBs). Accordingly this requires management to exercise its judgement in the process of applying the Council's accounting policies. Estimates and judgements are continually evaluated and are based on historical experience and other factors, including expectations of future events that may have a financial impact on the entity and that are believed to be reasonable under the circumstances. Critical accounting estimates and assumptions Council makes estimates concerning the future.

and

assumptions

The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are set out below. (i)

Estimated fair values of investment properties

(ii)

Estimated fair values of infrastructure, property, plant and equipment.

(iii) Estimated tip remediation provisions. Critical judgements in applying the entity's accounting policies (i)

Impairment of Receivables - Council has made a significant judgement about the impairment of a number of its receivables in Note 7.

(ii)

Projected Section 94 Commitments - Council has used significant judgement in determining future Section 94 income and expenditure in Note 17.

(b) Revenue recognition Council recognises revenue when the amount of revenue can be reliably measured, it is probable that future economic benefits will flow to the entity and specific criteria have been met for each of the Councilâ&#x20AC;&#x2122;s activities as described below. Council bases any estimates on historical results, taking into consideration the type of customer, the type of transaction and the specifics of each arrangement. Revenue is measured at the fair value of the consideration received or receivable. Revenue is measured on major income categories as follows: Rates, Annual Charges, Grants and Contributions Rates, annual charges, grants and contributions (including developer contributions) are recognised as revenues when the Council obtains control over the assets comprising these receipts. Control over assets acquired from rates and annual charges is obtained at the commencement of the rating year as it is an enforceable debt linked to the rateable property or, where earlier, upon receipt of the rates. A provision for the impairment on rates receivables has not been established as unpaid rates represent a charge against the rateable property that will be recovered when the property is next sold. Control over granted assets is normally obtained upon their receipt (or acquittal) or upon earlier notification that a grant has been secured, and is valued at their fair value at the date of transfer. Revenue from Contributions is recognised when the Council either obtains control of the contribution or the right to receive it, (i) it is probable that the economic benefits comprising the contribution will flow to the Council and (ii) the amount of the contribution can be measured reliably. Where grants or contributions recognised as revenues during the financial year were obtained on condition that they be expended in a particular manner or used over a particular period and those conditions were undischarged at reporting date, the

page 11

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies unused grant or contribution is disclosed in Note 3(g). Note 3(g) also discloses the amount of unused grant or contribution from prior years that was expended on Council’s operations during the current year. The Council has obligations to provide facilities from contribution revenues levied on developers under the provisions of S94 of the EPA Act 1979.

Interest and Rents Rents are recognised as revenue on a proportional basis when the payment is due, the value of the payment is notified, or the payment is received, whichever first occurs. Interest Income from Cash & Investments is accounted for using the Effective Interest method in accordance with AASB 139.

Whilst Council generally incorporates these amounts as part of a Development Consents Order, such developer contributions are only recognised as income upon their physical receipt by Council, due to the possibility that individual Development Consents may not be acted upon by the applicant and accordingly would not be payable to Council.

Developer contributions may only be expended for the purposes for which the contributions were required but the Council may apply contributions according to the priorities established in work schedules.

The financial statements also include Council’s share of the assets, liabilities, income and expenses of any Jointly Controlled Operations under the appropriate headings.

A detailed Note relating to developer contributions can be found at Note 17.

In the process of reporting on Council’s activities as a single unit, all inter-entity year end balances and reporting period transactions have been eliminated in full between Council and its controlled entities.

These financial statements incorporate (i) the assets and liabilities of Council and any Entities (or operations) that it controls (as at 30 June 2013) and (ii) all the related operating results (for the financial year ended the 30th June 2013).

User Charges, Fees and Other Income (i) The Consolidated Fund User charges, fees and other income (including parking fees and fines) are recognised as revenue when the service has been provided, the payment is received, or when the penalty has been applied, whichever first occurs. A provision for the impairment of these receivables is recognised when collection in full is no longer probable. A liability is recognised in respect of revenue that is reciprocal in nature to the extent that the requisite service has not been provided as at reporting date. Sale of Infrastructure, Equipment

Property,

Plant

In accordance with the provisions of Section 409(1) of the LGA 1993, all money and property received by Council is held in the Council’s Consolidated Fund unless it is required to be held in the Council’s Trust Fund. The Consolidated Fund and other entities through which the Council controls resources to carry on its functions have been included in the financial statements forming part of this report. The following entities have been included as part of the Consolidated Fund:

and

The profit or loss on sale of an asset is determined when control of the asset has irrevocably passed to the buyer.



Moree Plains Shire Council’s -

General Purpose Operations Water Supply Fund Sewerage Fund Gwydir Day Care Centre Max Centre

page 12

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies (ii) The Trust Fund

(v) County Councils

In accordance with the provisions of Section 411 of the Local Government Act 1993 (as amended), a separate and distinct Trust Fund is maintained to account for all money and property received by the Council in trust which must be applied only for the purposes of or in accordance with the trusts relating to those monies.

Council is not a member of any County Councils. (vi) Additional Information Note 19 provides more information in relation to Joint Venture Entities, Associated Entities and Joint Venture Operations where applicable.

Trust monies and property subject to Council’s control have been included in these statements.

(d) Leases

Trust monies and property held by Council but not subject to the control of Council, have been excluded from these statements.

All Leases entered into by Council are reviewed and classified on inception date as either a Finance Lease or an Operating Lease.

A separate statement of monies held in the Trust Fund is available for inspection at the Council office by any person free of charge.

Finance Leases

(iii) Joint Ventures

Leases of property, plant and equipment where the Council has substantially all the risks and rewards of ownership are classified as finance leases.

Council participates in a number of cooperative arrangements with other Councils and other bodies. Council’s equity share in joint ventures is considered to be immaterial and has not been included in Council’s accounts.

Finance leases are capitalised at the lease’s inception at the lower of the fair value of the leased property and the present value of the minimum lease payments.

NWSP Cooperative Library

The corresponding rental obligations, net of finance charges, are included in borrowings.

The NWSP Cooperative Library is a contractual association between the Council’s of Moree Plains, Gwydir, Walgett and Brewarrina to carry out jointly a library service in there respective areas under the provision of Section 11 of the Library Act 1939. Details relating to such Entities and Partnerships (where applicable) are set out in Note 19. (iv) Associated Entities Where Council has the power to participate in the financial and operating decisions (of another entity), ie. where Council is deemed to have “significant influence” over the other entities operations but neither controls nor jointly controls the entity, then Council accounts for such interests using the equity method of accounting – in a similar fashion to Joint Venture Entities & Partnerships. Such entities are usually termed Associates.

Each lease payment is allocated between the liability outstanding and the recognition of a finance charge. The interest element of the finance charge is costed to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. Property, plant and equipment acquired under finance leases is depreciated over the shorter of each leased asset’s useful life and the lease term. Operating Leases Leases in which a significant portion of the risks and rewards of ownership are retained by the lessor are classified as operating leases. Payments made under operating leases (net of any incentives received from the lessor) are charged to the income statement on a straight-line basis over the period of the lease.

page 13

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies Lease income from operating leases is recognised in income on a straight-line basis over the lease term.

(e) Cash and Cash Equivalents Cash and cash equivalents includes;  cash on hand,  deposits held at call with financial institutions,  other short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value, and  bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities on the Statement of Financial Position but are incorporated into Cash & Cash Equivalents for presentation of the Statement of Cashflows.

(f) Investments and Other Financial Assets Council (in accordance with AASB 139) classifies each of its investments into one of the following categories for measurement purposes:  financial assets at fair value through the income statement,  loans and receivables,  held-to-maturity investments, and  available-for-sale financial assets. Each classification depends on the purpose/intention for which the investment was acquired & at the time it was acquired. Management determines each Investment classification at the time of initial recognition and reevaluates this designation at each reporting date. (i) Financial assets at fair value through the income statement

Financial assets at fair value through the income statement include financial assets that are “held for trading”. A financial asset is classified in the “held for trading” category if it is acquired principally for the purpose of selling in the short term. Derivatives are classified as held for trading unless they are designated as hedges. Assets in this category are primarily classified as current assets as they are primarily held for trading &/or are expected to be realised within 12 months of the reporting date. (ii) Loans and receivables Loans and receivables are non derivative financial assets with fixed or determinable payments that are not quoted in an active market. They arise when the Council provides money, goods or services directly to a debtor with no intention (or in some cases ability) of selling the resulting receivable. They are included in current assets, except for those with maturities greater than 12 months after the reporting date which are classified as non-current assets. (iii) Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fixed or determinable payments and fixed maturities that the Council’s management has the positive intention and ability to hold to maturity. In contrast to the “Loans & Receivables” classification, these investments are generally quoted in an active market. Held-to-maturity financial assets are included in noncurrent assets, except for those with maturities less than 12 months from the reporting date, which are classified as current assets. (iv) Available-for-sale financial assets Available-for-sale financial assets are non-derivatives that are either designated in this category or not classified in any of the other categories.

page 14

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies Investments must be designated as available-forsale if they do not have fixed maturities and fixed or determinable payments and management intends to hold them for the medium to long term.

General Accounting & Measurement of Financial Instruments:

Accordingly, this classification principally comprises marketable equity securities, but can include all types of financial assets that could otherwise be classified in one of the other investment categories.

Investments are initially recognised (and measured) at fair value, plus in the case of investments not at “fair value through profit or loss”, directly attributable transactions costs

They are generally included in non-current assets unless management intends to dispose of the investment within 12 months of the reporting date or the term to maturity from the reporting date is less than 12 months.

Purchases and sales of investments are recognised on trade-date - the date on which the Council commits to purchase or sell the asset.

Financial Assets – Reclassification Council may choose to reclassify a non-derivative trading financial asset out of the held-for-trading category if the financial asset is no longer held for the purpose of selling it in the near term. Financial assets other than loans and receivables are permitted to be reclassified out of the held-fortrading category only in rare circumstances arising from a single event that is unusual and highly unlikely to recur in the near term. Council may also choose to reclassify financial assets that would meet the definition of loans and receivables out of the held-for-trading or availablefor-sale categories if it has the intention and ability to hold these financial assets for the foreseeable future or until maturity at the date of reclassification. Reclassifications are made at fair value as of the reclassification date. Fair value becomes the new cost or amortised cost as applicable, and no reversals of fair value gains or losses recorded before reclassification date are subsequently made. Effective interest rates for financial assets reclassified to loans and receivables and held-tomaturity categories are determined at the reclassification date. Further increases in estimates of cash flows adjust effective interest rates prospectively.

(i) Initial Recognition

Financial assets are derecognised when the rights to receive cash flows from the financial assets have expired or have been transferred and the Council has transferred substantially all the risks and rewards of ownership. (ii) Subsequent Measurement Available-for-sale financial assets and financial assets at fair value through the income statement are subsequently carried at fair value. Loans and receivables and held-to-maturity investments are carried at amortised cost using the effective interest method. Realised and unrealised gains and losses arising from changes in the fair value of the financial assets classified as “fair value through the income statement” category are included in the income statement in the period in which they arise. Unrealised gains and losses arising from changes in the fair value of non monetary securities classified as "available-for-sale" are recognised in equity in the available-for-sale investments revaluation reserve. When securities classified as "available-for-sale" are sold or impaired, the accumulated fair value adjustments are included in the income statement as gains and losses from investment securities. Impairment Council assesses at each reporting date whether there is objective evidence that a financial asset or group of financial assets is impaired.

page 15

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies A financial asset or a group of financial assets is impaired and impairment losses are incurred only if there is objective evidence of impairment as a result of one or more events that occurred after the initial recognition of the asset (a ‘loss event’) and that loss event (or events) has an impact on the estimated future cash flows of the financial asset or group of financial assets that can be reliably estimated. In the case of equity securities classified as available-for-sale, a significant or prolonged decline in the fair value of a security below its cost is considered in determining whether the security is impaired. If any such evidence exists for available-for-sale financial assets, the cumulative loss - measured as the difference between the acquisition cost and the current fair value, less any impairment loss on that financial asset previously recognised through the income statement - is removed from equity and recognised in the income statement. Impairment losses recognised in the income statement on equity instruments are not reversed through the income statement. If there is evidence of impairment for any of Council’s financial assets carried at amortised cost (eg. loans and receivables), the amount of the loss is measured as the difference between the asset’s carrying amount and the present value of estimated future cash flows (excluding future credit losses that have not been incurred) discounted at the financial asset’s original effective interest rate. The carrying amount of the asset is reduced and the amount of the loss is recognised through the income statement. If a loan or held-to-maturity investment has a variable interest rate, the discount rate for measuring any impairment loss is the current effective interest rate determined under the contract. As a practical expedient, the group may measure impairment on the basis of an instrument’s fair value using an observable market price. (iii) Types of Investments Council has an approved Investment Policy in order to undertake its investment of money in accordance with (and to comply with) Section 625 of the Local

Government Act and S212 of the LG (General) Regulation 2005. Investments are placed and managed in accordance with the Policy and having particular regard to authorised investments prescribed under the Ministerial Local Government Investment Order. Council maintains its investment Policy in compliance with the Act and ensures that it or its representatives exercise care, diligence and skill that a prudent person would exercise in investing Council funds. Council amended its policy following revisions to the Ministerial Local Government Investment Order arising from the Cole Inquiry recommendations. Certain investments that Council holds are no longer prescribed (eg. managed funds, CDOs, and equity linked notes), however they have been retained under grandfathering provisions of the Order. These will be disposed of when most financially advantageous to Council.

(g) Fair value estimation The fair value of financial assets and financial liabilities must be estimated for recognition and measurement or for disclosure purposes. The fair value of financial instruments traded in active markets is based on quoted market prices at the reporting date. The fair value of financial instruments that are not traded in an active market is determined using valuation techniques. Council uses a variety of methods and makes assumptions that are based on market conditions existing at each reporting date. Quoted market prices or dealer quotes for similar instruments are used for long-term debt instruments held. If the market for a financial asset is not active (and for unlisted securities), the Council establishes fair value by using valuation techniques. These include reference to the fair values of recent arm’s length transactions, involving the same instruments or other instruments that are

page 16

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies substantially the same, discounted cash flow analysis, and option pricing models refined to reflect the issuerâ&#x20AC;&#x2122;s specific circumstances. The nominal value less estimated credit adjustments of trade receivables and payables are assumed to approximate their fair values. The fair value of financial liabilities for disclosure purposes is estimated by discounting the future contractual cash flows at the current market interest rate that is available to the Council for similar financial instruments.

(h) Receivables Receivables are initially recognised at fair value and subsequently measured at amortised cost, less any provision for impairment. Receivables (excluding Rates & Annual Charges) are generally due for settlement no more than 30 days from the date of recognition. The collectibility of receivables is reviewed on an ongoing basis. Debts which are known to be uncollectible are written off in accordance with Councilâ&#x20AC;&#x2122;s policy. A provision for impairment (ie. an allowance account) relating to receivables is established when there is objective evidence that the Council will not be able to collect all amounts due according to the original terms of each receivable. The amount of the provision is the difference between the assetâ&#x20AC;&#x2122;s carrying amount and the present value of estimated future cash flows, discounted at the effective interest rate. Impairment losses are recognised in the Income Statement within other expenses. When a receivable for which an impairment allowance had been recognised becomes uncollectible in a subsequent period, it is written off against the allowance account.

(i) Inventories Raw Materials and Stores, Work in Progress and Finished Goods Raw materials and stores, work in progress and finished goods in respect of business undertakings are all stated at the lower of cost and net realisable value. Cost comprises direct materials, direct labour and an appropriate proportion of variable and fixed overhead expenditure, the latter being allocated on the basis of normal operating capacity. Costs are assigned to individual items of inventory on the basis of weighted average costs. Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale. Inventories held in respect of non-business undertakings have been valued at cost subject to adjustment for loss of service potential. Land Held for Resale/Capitalisation of Borrowing Costs Land held for resale is stated at the lower of cost and net realisable value. Cost is assigned by specific identification and includes the cost of acquisition, and development and borrowing costs during development. When development is completed borrowing costs and other holding charges are expensed as incurred. Borrowing costs included in the cost of land held for resale are those costs that would have been avoided if the expenditure on the acquisition and development of the land had not been made. Borrowing costs incurred while active development is interrupted for extended periods are recognised as expenses.

Subsequent recoveries of amounts previously written off are credited against other expenses in the income statement.

page 17

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies (j) Infrastructure, Property, Plant and Equipment (I,PP&E) Acquisition of assets

The discount rate used is the Council’s incremental borrowing rate, being the rate at which a similar borrowing could be obtained from an independent financier under comparable terms and conditions.

At reporting date, the following classes of I,PP&E were stated at their Fair Value;

Where infrastructure, property, plant and equipment assets are acquired for no cost or for an amount other than cost, the assets are recognised in the financial statements at their fair value at acquisition date - being the amount that the asset could have been exchanged between knowledgeable willing parties in an arm’s length transaction.

Investment Properties – refer Note 1(p),

Subsequent costs

Water and Sewerage Networks

Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to Council and the cost of the item can be measured reliably. All other repairs and maintenance are charged to the income statement during the financial period in which they are incurred.

Council’s non current assets are continually revalued (over a 5 year period) in accordance with the fair valuation policy as mandated by the Division of Local Government.

(Internal Valuation)

Operational Land (Internal Valuation)

Buildings – Specialised/Non Specialised (External Valuation)

Plant and Equipment (as approximated by depreciated historical cost)

Roads Assets incl. roads, bridges & footpaths (Internal Valuation)

Drainage Assets (Internal Valuation)

Bulk Earthworks (Internal Valuation)

Community Land (Internal Valuation)

Land Improvements (as approximated by depreciated historical cost)

Other Structures (as approximated by depreciated historical cost)

Other Assets (as approximated by depreciated historical cost)

Initial Recognition On initial recognition, an assets cost is measured at its fair value, plus all expenditure that is directly attributable to the acquisition. Where settlement of any part of an asset’s cash consideration is deferred, the amounts payable in the future are discounted to their present value as at the date of recognition (ie. date of exchange) of the asset to arrive at fair value.

Asset Revaluations (including Indexation) In accounting for asset revaluations relating to infrastructure, property, plant & equipment:  Increases in the combined carrying amounts of asset classes arising on revaluation are credited to the asset revaluation reserve.  To the extent that a net asset class increase reverses a decrease previously recognised via the income statement, then increase is first recognised through the income statement.  Net decreases that reverse previous increases of the same asset class are first charged against revaluation reserves directly in equity to the extent of the remaining reserve attributable to the asset, with all other decreases charged to the Income statement. Water and sewerage network assets are indexed annually between full revaluations in accordance with the latest indices provided in the NSW Office of Water - Rates reference manual. For all other assets, Council assesses at each reporting date whether there is any indication that a revalued asset’s carrying amount may differ page 18

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies materially from that which would be determined if the asset were revalued at the balance date. If any such indication exists, Council determines the assetâ&#x20AC;&#x2122;s fair value and revalues the asset to that amount.

Depreciation Depreciation on Council's infrastructure, property, plant and equipment assets is calculated using the straight line method in order to allocate an assets cost (net of residual values) over its estimated useful life.

Full revaluations are undertaken for all assets on a 5 year cycle.

Land is not depreciated.

Capitalisation Thresholds

Estimated useful lives for Council's I,PP&E include:

Items of infrastructure, property, plant and equipment are not capitalised unless their cost of acquisition exceeds the following;

Plant & Equipment - Office Equipment - Office furniture - Vehicles - Heavy Plant/Road Making equip. - Other plant and equipment

5 to 10 years 10 to 20 years 5 to 8 years 5 to 8 years 5 to 15 years

Other Equipment - Playground equipment - Benches, seats etc

5 to 15 years 10 to 20 years

Buildings - Buildings : Masonry - Buildings : Other

50 to 100 years 20 to 40 years

Stormwater Drainage - Drains - Culverts - Flood Control Structures

100 years 60 years 100 years

Transportation Assets - Sealed Roads : Surface - Sealed Roads : Structure - Unsealed roads

30 years 60 years 100 years

- Bridge : Concrete

60 years

- Road Pavements - Kerb, Gutter & Paths

60 years 60 years

Water & Sewer Assets - Dams and reservoirs - Bores

100 years 30 years

- Reticulation pipes : PVC - Reticulation pipes : Other - Pumps and telemetry

70 years 25 to 75 years 5 to 15 years

Other Infrastructure Assets - Bulk earthworks

Infinite

Land - council land - open space - land under roads (purchases after 30/6/08)

100% Capitalised 100% Capitalised 100% Capitalised

Plant & Equipment Office Furniture Office Equipment Other Plant &Equipment

> $1,000 > $1,000 > $1,000

Buildings & Land Improvements Park Furniture & Equipment

> $2,000

Building - construction/extensions - renovations Other Structures

> $10,000 > $10,000 > $2,000

Water & Sewer Assets Reticulation extensions Other

> $1,000 > $1,000

Stormwater Assets Drains & Culverts Other

> $1,000 > $1,000

Transport Assets Road construction & reconstruction Reseal/Re-sheet & major repairs:

> $1,000 > $1,000

Bridge construction & reconstruction

> $1,000

page 19

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies All asset residual values and useful lives are reviewed and adjusted (where appropriate), at each reporting date. An asset’s carrying amount is written down immediately to its recoverable amount if the asset’s carrying amount is greater than its estimated recoverable amount – refer Note 1(s) on Asset Impairment.

(n) Crown Reserves Crown Reserves under Council’s care and control are recognised as assets of the Council. While ownership of the reserves remains with the Crown, Council retains operational control of the reserves and is responsible for their maintenance and use in accordance with the specific purposes to which the reserves are dedicated.

Disposal and De-recognition An item of property, plant and equipment is derecognised upon disposal or when no further future economic benefits are expected from its use or disposal. Any gain or loss arising on derecognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in Council’s Income Statement in the year the asset is derecognised.

Improvements on Crown Reserves are also recorded as assets, while maintenance costs incurred by Council and revenues relating to reserves are recognised within Council’s Income Statement. Representations are currently being sought across State and Local Government to develop a consistent accounting treatment for Crown Reserves across both tiers of government.

(o) Rural Fire Service assets (k) Land Land (other than Land under Roads) is in accordance with Part 2 of Chapter 6 of the Local Government Act (1993) classified as either Operational or Community. This classification of Land is disclosed in Note 9(a).

(l) Land under roads Land under roads is land under roadways and road reserves including land under footpaths, nature strips and median strips. Council has elected not to recognise land under roads acquired before 1 July 2008 in accordance with AASB 1051.

Under section 119 of the Rural Fires Act 1997, “all fire fighting equipment purchased or constructed wholly or from money to the credit of the Fund is to be vested in the council of the area for or on behalf of which the fire fighting equipment has been purchased or constructed”. At present, the accounting for such fire fighting equipment is not treated in a consistent manner across all Councils. Until such time as discussions on this matter have concluded and the legislation changed, Council will continue to account for these assets as it has been doing in previous years, which is to incorporate the assets, their values and depreciation charges within these financial statements.

(p) Investment property Land under roads acquired after 1 July 2008 is recognised in accordance with AASB 116 – Property, Plant and Equipment.

(m) Intangible Assets

Investment property comprises land &/or buildings that are principally held for long-term rental yields, capital gains or both that is not occupied by Council. At the reporting date, council did not hold any investment property.

Council has not classified any assets as Intangible.

page 20

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies (q) Provisions for close down, restoration and for environmental clean up costs â&#x20AC;&#x201C; including Tips and Quarries Close down, restoration and remediation costs include the dismantling and demolition of infrastructure, the removal of residual materials and the remediation of disturbed areas. Estimated close down and restoration costs are provided for in the accounting period when the obligation arising from the related disturbance occurs, whether this occurs during the development or during the operation phase, based on the net present value of estimated future costs. Provisions for close down and restoration costs do not include any additional obligations which are expected to arise from future disturbance. Costs are estimated on the basis of a closure plan. The cost estimates are calculated annually during the life of the operation to reflect known developments, eg updated cost estimates and revisions to the estimated lives of operations, and are subject to formal review at regular intervals. Close down, restoration and remediation costs are a normal consequence of tip and quarry operations, and the majority of close down and restoration expenditure is incurred at the end of the life of the operations. Although the ultimate cost to be incurred is uncertain, Council estimates the respective costs based on feasibility and engineering studies using current restoration standards and techniques. The amortisation or â&#x20AC;&#x2DC;unwindingâ&#x20AC;&#x2122; of the discount applied in establishing the net present value of provisions is charged to the income statement in each accounting period. This amortisation of the discount is disclosed as a borrowing cost in Note 4(b).

These costs are then depreciated over the lives of the assets to which they relate. Where rehabilitation is conducted systematically over the life of the operation, rather than at the time of closure, provision is made for the estimated outstanding continuous rehabilitation work at each reporting date and the cost is charged to the income statement. Provision is made for the estimated present value of the costs of environmental clean up obligations outstanding at the reporting date. These costs are charged to the income statement. Movements in the environmental clean up provisions are presented as an operating cost, except for the unwind of the discount which is shown as a borrowing cost. Remediation procedures generally commence soon after the time the damage, remediation process and estimated remediation costs become known, but may continue for many years depending on the nature of the disturbance and the remediation techniques. As noted above, the ultimate cost of environmental remediation is uncertain and cost estimates can vary in response to many factors including changes to the relevant legal requirements, the emergence of new restoration techniques or experience at other locations. The expected timing of expenditure can also change, for example in response to changes in quarry reserves or production rates. As a result there could be significant adjustments to the provision for close down and restoration and environmental clean up, which would affect future financial results. Specific Information relating to Council's provisions relating to close down, restoration and remediation costs can be found at Note 26.

Other movements in the provisions for Close down, restoration and remediation costs including those resulting from new disturbance, updated cost estimates, changes to the estimated lives of operations and revisions to discount rates are capitalised within property, plant and equipment. page 21

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies (r) Non-Current Assets (or Disposal Groups) “Held for Sale” & Discontinued Operations Non-current assets (or disposal groups) are classified as held for sale and stated at the lower of either (i) their carrying amount and (ii) fair value less costs to sell, if their carrying amount will be recovered principally through a sale transaction rather than through continuing use. The exception to this is plant and motor vehicles which are turned over on a regular basis. Plant and motor vehicles are retained in Non Current Assets under the classification of Infrastructure, Property, Plant and Equipment - unless the assets are to be traded in after 30 June and the replacement assets were already purchased and accounted for as at 30 June. For any assets or disposal groups classified as NonCurrent Assets “held for sale”, an impairment loss is recognised at any time when the assets carrying value is greater than its fair value less costs to sell.

circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. Where an asset is not held principally for cash generating purposes (for example Infrastructure Assets) and would be replaced if the Council was deprived of it then depreciated replacement cost is used as value in use, otherwise value in use is estimated by using a discounted cash flow model. Non-financial assets (other than goodwill) that suffered a prior period impairment are reviewed for possible reversal of the impairment at each reporting date. Goodwill & other Intangible Assets that have an indefinite useful life and are not subject to amortisation are tested annually for impairment.

Non-current assets “held for sale” are not depreciated or amortised while they are classified as “held for sale”.

(t) Payables

Non-current assets classified as “held for sale” are presented separately from the other assets in the Statement of Financial Position.

These amounts represent liabilities and include goods and services provided to the Council prior to the end of financial year which are unpaid.

A Discontinued Operation is a component of the entity that has been disposed of or is classified as “held for sale” and that represents a separate major line of business or geographical area of operations, is part of a single co-ordinated plan to dispose of such a line of business or area of operations, or is a subsidiary acquired exclusively with a view to resale.

The amounts for goods and services are unsecured and are usually paid within 30 days of recognition.

The results of discontinued operations are presented separately on the face of the income statement.

(s) Impairment of assets All Council's I,PP&E is subject to an annual assessment of impairment.

(u) Borrowings Borrowings are initially recognised at fair value, net of transaction costs incurred. Borrowings are subsequently measured at amortised cost. Amortisation results in any difference between the proceeds (net of transaction costs) and the redemption amount being recognised in the Income Statement over the period of the borrowings using the effective interest method.

Assets that are subject to amortisation are reviewed for impairment whenever events or changes in

page 22

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies Borrowings are removed from the Statement of Financial Position when the obligation specified in the contract is discharged, cancelled or expired.

(x) Employee benefits

Borrowings are classified as current liabilities unless the Council has an unconditional right to defer settlement of the liability for at least 12 months after the reporting date.

Short term employee benefit obligations include liabilities for wages and salaries (including nonmonetary benefits), annual leave and vesting sick leave expected to be settled within the 12 months after the reporting period.

(v) Borrowing costs

Leave liabilities are recognised in the provision for employee benefits in respect of employees’ services up to the reporting date with other short term employee benefit obligations disclosed under payables.

Borrowing costs are expensed.

(i) Short Term Obligations

(w) Provisions Provisions for legal claims, service warranties and other like liabilities are recognised when:  Council has a present legal or constructive obligation as a result of past events;

These provisions are measured at the amounts expected to be paid when the liabilities are settled. Liabilities for non vesting sick leave are recognised at the time when the leave is taken and measured at the rates paid or payable, and accordingly no Liability has been recognised in these reports.

 it is more likely than not that an outflow of resources will be required to settle the obligation; and

Wages & salaries, annual leave and vesting sick leave are all classified as Current Liabilities.

 the amount has been reliably estimated.

(ii) Other Long Term Obligations

Provisions are not recognised for future operating losses.

The liability for all long service and annual leave in respect of services provided by employees up to the reporting date (which is not expected to be settled within the 12 months after the reporting period) are recognised in the provision for employee benefits.

Where there are a number of similar obligations, the likelihood that an outflow will be required in settlement is determined by considering the class of obligations as a whole. A provision is recognised even if the likelihood of an outflow with respect to any one item included in the same class of obligations may be small. Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present obligation at the reporting date. The discount rate used to determine the present value reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense.

These liabilities are measured at the present value of the expected future payments to be made using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. Expected future payments are then discounted using market yields at the reporting date based on national government bonds with terms to maturity and currency that match as closely as possible the estimated future cash outflows. Due to the nature of when and how Long Service Leave can be taken, all Long Service Leave for employees with 4 or more years of service has been classified as Current, as it has been deemed that

page 23

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies Council does not have the unconditional right to defer settlement beyond 12 months – even though it is not anticipated that all employees with more than 4 years service (as at reporting date) will apply for and take their leave entitlements in the next 12 months. (iii) Retirement benefit obligations All employees of the Council are entitled to benefits on retirement, disability or death. Council contributes to various defined benefit plans and defined contribution plans on behalf of its employees.

Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available. (iv) Employee Benefit On-Costs Council has recognised at year end the aggregate on-cost liabilities arising from employee benefits, and in particular those on-cost liabilities that will arise when payment of current employee benefits is made in future periods. These amounts include Superannuation and Workers Compensation expenses which will be payable upon the future payment of certain Leave Liabilities accrued as at 30/6/13.

Defined Benefit Plans A liability or asset in respect of defined benefit superannuation plans would ordinarily be recognised in the Statement of Financial Position, and measured as the present value of the defined benefit obligation at the reporting date plus unrecognised actuarial gains (less unrecognised actuarial losses) less the fair value of the superannuation fund’s assets at that date and any unrecognised past service cost. The present value of the defined benefit obligation is based on expected future payments which arise from membership of the fund to the reporting date, calculated annually by independent actuaries using the projected unit credit method. Consideration is given to expected future wage and salary levels, experience of employee departures and periods of service. However, when this information is not reliably available, Council can account for its obligations to defined benefit plans on the same basis as its obligations to defined contribution plans – i.e. as an expense when they become payable. Council is party to an Industry Defined Benefit Plan under the Local Government Superannuation Scheme, named the “Local Government Superannuation Scheme – Pool B” Defined Contribution Plans Contributions to Defined Contribution Plans are recognised as an expense as they become payable.

(y) Self insurance Council does not self insure.

(z) Allocation between current and non-current assets & liabilities In the determination of whether an asset or liability is classified as current or non-current, consideration is given to the time when each asset or liability is expected to be settled. The asset or liability is classified as current if it is expected to be settled within the next 12 months, being the Council’s operational cycle. Exceptions In the case of liabilities where Council does not have the unconditional right to defer settlement beyond 12 months (such as vested long service leave), the liability is classified as current even if not expected to be settled within the next 12 months. In the case of inventories that are “held for trading”, these are also classified as current even if not expected to be realised in the next 12 months.

(aa) Taxes The Council is exempt from both Commonwealth Income Tax and Capital Gains Tax.

page 24

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies Council does however have to comply with both Fringe Benefits Tax and Goods and Services Tax (GST). Goods & Services Tax (GST) Income, expenses and assets are all recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Tax Office (ATO). In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of the revenue / expense. Receivables and payables within the Statement of Financial Position are stated inclusive of any applicable GST. The net amount of GST recoverable from or payable to the ATO is included as a current asset or current liability in the Statement of Financial Position. Operating cash flows within the Statement of Cashflows are on a gross basis, ie. they are inclusive of GST where applicable. Investing and Financing cash flows are treated on a net basis (where recoverable form the ATO), ie. they are exclusive of GST. Instead, the GST component of investing and financing activity cash flows which are recoverable from or payable to the ATO are classified as operating cash flows.

Applicable to implications:

Local

Government

with

AASB 9 Financial Instruments, associated standards, AASB 2010-7 Amendments to Australian Accounting Standards arising from AASB 9 and AASB 2012-6 Amendments to Australian Accounting Standards – Mandatory Effective Date of AASB 9 and transitional disclosures (effective from 1 January 2015) AASB 9 Financial Instruments addresses the classification, measurement and de-recognition of financial assets and financial liabilities. The standard is not applicable until 1 January 2015 but is available for early adoption. When adopted, the standard will affect in particular Council’s accounting for its available-for-sale financial assets, since AASB 9 only permits the recognition of fair value gains and losses in other comprehensive income if they relate to equity investments that are not held for trading. Fair value gains and losses on available-for-sale debt investments, for example, will therefore have to be recognised directly in the income statement although there is currently a proposal by the IASB to introduce a Fair value through Other Comprehensive Income category for debt instruments.

Commitments and contingencies are disclosed net of the amount of GST recoverable from (or payable to) the ATO.

There will be no impact on Council’s accounting for financial liabilities, as the new requirements only affect the accounting for financial liabilities that are designated at fair value through the income statement and Council does not have any such liabilities.

(ab) New accounting standards and UIG interpretations

The de-recognition rules have been transferred from AASB 139 Financial Instruments: Recognition and Measurement and have not been changed.

Certain new (or amended) accounting standards and interpretations have been published that are not mandatory for reporting periods ending 30 June 2013.

AASB 13 Fair Value Measurement and AASB 2011-8 Amendments to Australian Accounting Standards arising from AASB 13 (effective 1 January 2013)

Council has not adopted any of these standards early.

AASB 13 explains how to measure fair value and aims to enhance fair value disclosures.

Council’s assessment of the impact of these new standards and interpretations is set out below.

Council has yet to determine which, if any, of its current measurement techniques will have to change as a result of the new guidance.

page 25

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies It is therefore not possible to state the impact, if any, of the new rules on any of the amounts recognised in the financial statements. However, application of the new standard will impact the type of information disclosed in the notes to the financial statements. Council does not intend to adopt the new standard before its operative date, which means that it would be first applied in the annual reporting period ending 30 June 2014.

Applicable to Local Government implications for Council;

but

The adoption of this standard will not change the reported financial position and performance of the entity, there are no impact on disclosures as there are no offsetting arrangements currently in place. Applicable to Local Government but not relevant to Council at this stage; AASB 10 Consolidated Financial Statements, AASB 11 Joint Arrangements, AASB 12 Disclosure of Interests in Other Entities, revised AASB 127 Separate Financial Statements and AASB 128 Investments in Associates and Joint Ventures and AASB 2011-7 Amendments to Australian Accounting Standards arising from the Consolidation and Joint Arrangements Standards (effective 1 January 2013)

AASB 2012-2 Amendments to Australian Accounting Standards – Disclosures – Offsetting Financial Assets and Financial Liabilities [AASB 132 & AASB 7] (effective 1 January 2013)

This suite of five new and amended standards address the accounting for joint arrangements, consolidated financial statements and associated disclosures.

This Standard amends the required disclosures in AASB 7 to include information that will enable users of an entity’s financial statements to evaluate the effect or potential effect of netting arrangements, including rights of set-off associated with the entity’s recognised financial assets and recognised financial liabilities, on the entity’s financial position.

AASB 10 replaces all of the guidance on control and consolidation in AASB 127 Consolidated and Separate Financial Statements, and Interpretation 12 Consolidation – Special Purpose Entities.

This Standard also amends AASB 132 to refer to the additional disclosures added to AASB 7 by this Standard. The adoption of this standard will not change the reported financial position and performance of the entity, there are no impact on disclosures as there are no offsetting arrangements currently in place. AASB 2012-3 Amendments to Australian Accounting Standards – Offsetting Financial Assets and Financial Liabilities [AASB 132] (effective 1 January 2014). This Standard adds application guidance to AASB 132 to address inconsistencies identified in applying some of the offsetting criteria of AASB 132, including clarifying the meaning of “currently has a legally enforceable right of set-off” and that some gross settlement systems may be considered equivalent to net settlement.

The core principle that a consolidated entity presents a parent and its subsidiaries as if they are a single economic entity remains unchanged, as do the mechanics of consolidation. However, the standard introduces a single definition of control that applies to all entities. It focuses on the need to have both power and rights or exposure to variable returns. Power is the current ability to direct the activities that significantly influence returns. Returns must vary and can be positive, negative or both. Control exists when the investor can use its power to affect the amount of its returns. There is also new guidance on participating and protective rights and on agent/principal relationships. Council does not expect the new standard to have a significant impact on its composition. AASB 11 introduces a principles based approach to accounting for joint arrangements.

page 26

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies The focus is no longer on the legal structure of joint arrangements, but rather on how rights and obligations are shared by the parties to the joint arrangement. Based on the assessment of rights and obligations, a joint arrangement will be classified as either a joint operation or a joint venture. Joint ventures are accounted for using the equity method, and the choice to proportionately consolidate will no longer be permitted. Parties to a joint operation will account their share of revenues, expenses, assets and liabilities in much the same way as under the previous standard. AASB 11 also provides guidance for parties that participate in joint arrangements but do not share joint control.

Council does not expect to adopt the new standards before their operative date. They would therefore be first applied in the financial statements for the annual reporting period ending 30 June 2014. Revised AASB 119 Employee Benefits, AASB 201110 Amendments to Australian Accounting Standards arising from AASB 119 (September 2011) and AASB 2011-11 Amendments to AASB 119 (September 2011) arising from Reduced Disclosure Requirements (effective 1 January 2013) This revised standard on accounting for employee benefits requires the recognition of all remeasurements of defined benefit liabilities/assets immediately in other comprehensive income (removal of the so-called 'corridor' method) and the calculation of a net interest expense or income by applying the discount rate to the net defined benefit liability or asset.

Council's investment in the joint venture partnership will be classified as a joint venture under the new rules.

This replaces the expected return on plan assets that is currently included in the income statement.

As Council already applies the equity method in accounting for this investment, AASB 11 will not have any impact on the amounts recognised in its financial statements.

The standard also introduces a number of additional disclosures for defined benefit liabilities/assets and could affect the timing of the recognition of termination benefits.

AASB 12 sets out the required disclosures for entities reporting under the two new standards, AASB 10 and AASB 11, and replaces the disclosure requirements currently found in AASB 127 and AASB 128.

The amendments will have to be implemented retrospectively.

Application of this standard by Council will not affect any of the amounts recognised in the financial statements, but will impact the type of information disclosed in relation to Council's investments. Amendments to AASB 128 provide clarification that an entity continues to apply the equity method and does not remeasure its retained interest as part of ownership changes where a joint venture becomes an associate, and vice versa.

Council does not recognise defined benefit assets and liabilities for the reasons set out in paragraph (x) (iii) and so these changes will not have an impact on its reported results.

Not applicable to Local Government per se; AASB 2012-5 Amendments to Australian Accounting Standards arising from Annual Improvements 2009â&#x20AC;&#x201C; 2011 Cycle (effective 1 January 2013)

The amendments also introduce a â&#x20AC;&#x153;partial disposalâ&#x20AC;? concept.

AASB 1 - this standard clarifies that an entity can apply AASB 1 more than once. An entity can elect to apply AASB 123 from the transition date or an earlier date.

Council is still assessing the impact of these amendments.

AASB 101 - clarifies that a third statement of financial position is required when the opening statement of

page 27

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 1. Summary of Significant Accounting Policies financial position is materially affected by any adjustments. AASB 116 - clarifies the classification of servicing equipment. AASB 132 and Interpretation 2 - clarifies that income tax relating to distributions to holders of an equity instrument and to transaction costs of an equity transaction shall be accounted for in accordance with AASB 112 Income Taxes AASB 134 - provides clarification about segment reporting. The amendments arising from this standard are not expected to change the reported financial position or performance of the Council.

There are no other standards that are not yet effective and that are expected to have a material impact on the entity in the current or future reporting periods and on foreseeable future transactions.

(ac) Rounding of amounts Unless otherwise indicated, amounts in the financial statements have been rounded off to the nearest thousand dollars.

(ad) Comparative Figures To ensure comparability with the current reporting periodâ&#x20AC;&#x2122;s figures, some comparative period line items and amounts may have been reclassified or individually reported for the first time within these financial statements and/or the notes.

page 28

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 2(a). Council Functions / Activities - Financial Information $ '000

Income, Expenses and Assets have been directly attributed to the following Functions / Activities. Details of these Functions/Activities are provided in Note 2(b).

Functions/Activities

Income from Continuing Operations Original

Expenses from Continuing Operations

Operating Result from Continuing Operations

Original

Grants included in Income from Continuing Operations

Total Assets held (Current & Non-current)

Original

Budget

Actual

Budget

Actual

Budget

Actual

2013

2012

2013

2012

2013

2012

2013

2012

2013

2012

Governance Administration Public Order & Safety Health Environment Community Services & Education Housing & Community Amenities Water Supplies Sewerage Services Recreation & Culture Mining, Manufacturing & Construction Transport & Communication Economic Affairs

301 590 2 3,516 999 522 3,701 3,061 1,503 30,916 647

1 712 830 5 3,262 986 576 4,209 3,441 1,060 37,515 760

5 490 716 2 3,280 900 477 3,557 3,473 615 15,444 610

561 5,319 1,397 388 4,297 1,869 1,511 4,534 2,907 4,859 197 41,733 1,308

725 3,494 1,520 364 4,418 1,524 1,957 4,595 3,116 5,532 (305) 45,539 1,614

470 4,251 1,442 353 3,766 1,588 1,954 4,354 2,976 5,639 201 25,961 1,624

(561) (5,018) (807) (386) (781) (870) (989) (833) 154 (3,356) (197) (10,817) (661)

(724) (2,782) (690) (359) (1,156) (538) (1,381) (386) 325 (4,472) 305 (8,024) (854)

(465) (3,761) (726) (351) (486) (688) (1,477) (797) 497 (5,024) (201) (10,517) (1,014)

173 518 319 361 141 31 94 31 24,140 124

175 447 222 358 59 24 21 31 6,278 83

15 61,311 5,122 5 24,574 3,641 47,241 28,078 40,617 126 224,264 8,135

59 42,908 1,759 8 23,386 1,547 46,649 28,661 26,371 111 198,834 6,269

Total Functions & Activities

45,758

53,357

29,569

70,880

74,093

54,579

(25,122)

(20,736)

(25,010)

25,932

7,698

443,129

376,562

26,826

27,211

25,831

26,826

27,211

25,831

5,728

7,333

72,584

80,568

55,400

70,880

74,093

54,579

1,704

6,475

821

31,660

15,031

443,129

376,562

Share of gains/(losses) in Associates &

page 29

1. Includes: Rates & Annual Charges (incl. Ex-Gratia), Untied General Purpose Grants & Unrestricted Interest & Investment Income. 1. Includes: Rates & Annual Charges (incl. Ex-Gratia), Untied General Purpose Grants & Unrestricted Interest & Investment Income.

Financial Statements 2013

Joint Ventures (using the Equity Method)

General Purpose Income 1 Operating Result from Continuing Operations

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 2(b). Council Functions / Activities - Component Descriptions Details relating to the Council's functions / activities as reported in Note 2(a) are as follows: GOVERNANCE Costs relating to the Councilâ&#x20AC;&#x2122;s role as a component of democratic government, including elections, membersâ&#x20AC;&#x2122; fees and expenses, subscriptions to local authority associations, meetings of council and policy making committees, area representation and public disclosure and compliance. ADMINISTRATION Corporate Support and Other Support Services (not otherwise attributed to the listed functions / activities). PUBLIC ORDER & SAFETY Fire protection, animal control, enforcement of local government regulations, emergency services and other. HEALTH Inspection, immunisations, food control, health centres, other and administration. ENVIRONMENT Noxious plants and insect/vermin control, other environmental protection, solid waste management, street cleaning, drainage and stormwater management. COMMUNITY SERVICES & EDUCATION Administration, family day care, child care, youth services, other family and children, aged and disabled, migrant services, Aboriginal services, other community services and education. HOUSING & COMMUNITY AMENITIES Housing, town planning, street lighting, other sanitation and garbage, public cemeteries, public conveniences and other community amenities. WATER SUPPLIES SEWERAGE SERVICES RECREATION & CULTURE Public libraries, museums, art galleries, community centres, public halls, other cultural services, swimming pools, sporting grounds, parks and gardens (lakes), other sport and recreation. FUEL & ENERGY - Gas Supplies MINING, MANUFACTURING & CONSTRUCTION Building control, abattoirs, quarries & pits and other. TRANSPORT & COMMUNICATION Urban roads, sealed rural roads, unsealed rural roads, bridges, footpaths, aerodromes, parking areas, bus shelters and services, water transport, RTA works and other. ECONOMIC AFFAIRS Camping areas, caravan parks, tourism and area promotion, industrial development promotion, saleyards and markets, real estate development, commercial nurseries and other business undertakings.

page 30

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 3. Income from Continuing Operations $ '000

Notes

Actual 2013

Actual 2012

3,981 13,459 2,171 19,611

3,647 12,285 2,011 17,943

1,371 1,151 2,602 282 5,406

1,338 1,135 2,622 271 5,366

25,017

23,309

(a) Rates & Annual Charges Ordinary Rates Residential Farmland Business Total Ordinary Rates Special Rates Nil Annual Charges (pursuant to s.496, s.496A, s.496B, s.501 & s.611) Domestic Waste Management Services Water Supply Services Sewerage Services Waste Management Services (non-domestic) Total Annual Charges

TOTAL RATES & ANNUAL CHARGES

Council has used 2011 year valuations provided by the NSW Valuer General in calculating its rates.

page 31

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 3. Income from Continuing Operations (continued) $ '000

Notes

Actual 2013

Actual 2012

756 2,777 343 3,876

744 2,094 344 3,182

209 77 286

169 123 292

512 136 564 593 5,899 974 456 62 9,196

568 142 529 548 5,141 507 475 50 7,960

13,358

11,434

(b) User Charges & Fees Specific User Charges (per s.502 - Specific "actual use" charges) Domestic Waste Management Services Water Supply Services Sewerage Services Total User Charges Other User Charges & Fees (i) Fees & Charges - Statutory & Regulatory Functions (per s.608)

Planning & Building Regulation Private Works - Section 67 Total Fees & Charges - Statutory/Regulatory (ii) Fees & Charges - Other (incl. General User Charges (per s.608)

Aerodrome Cemeteries Child Care Rent and Hire of Council Property RMS (formerly RTA) Charges (State Roads not controlled by Council) Swimming Centres Waste Disposal Tipping Fees Other Total Fees & Charges - Other

TOTAL USER CHARGES & FEES

page 32

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 3. Income from Continuing Operations (continued) $ '000

Notes

Actual 2013

Actual 2012

183 52 616 4

180 40 863 4

(c) Interest & Investment Revenue (incl. losses) Interest & Dividends - Interest on Overdue Rates & Annual Charges (incl. Special Purpose Rates) - Interest on Overdue User Charges and Fees - Interest earned on Investments (interest & coupon payment income) - Interest & Dividend Income (Other) Fair Value Adjustments - Fair Valuation movements in Investments (at FV or Held for Trading)

TOTAL INTEREST & INVESTMENT REVENUE

1,424

(141)

2,279

946

Unrestricted Investments/Financial Assets: Overdue Rates & Annual Charges (General Fund) General Council Cash & Investments

128 1,736

103 452

Restricted Investments/Funds - External: Development Contributions - Section 94 - Section 64 Water Fund Operations Sewerage Fund Operations Domestic Waste Management operations Total Interest & Investment Revenue Recognised

12 13 59 262 69 2,279

8 14 49 268 52 946

129 133 61 16 274 59 138 115 268

119 131 88 214 61 113 126 49

1,193

901

Interest Revenue is attributable to:

(d) Other Revenues Fines Legal Fees Recovery - Rates & Charges (Extra Charges) Insurance Premium Refunds and Incentive Payments Insurance Claim Recoveries Sales - General Sewer Services Weight of Loads Water Services Other

TOTAL OTHER REVENUE

page 33

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 3. Income from Continuing Operations (continued) $ '000

2013 Operating

2012 Operating

2013 Capital

2012 Capital

3,127 2,542 59 5,728

4,039 3,236 58 7,333

24 22 21 331 276 43 172 4 175 124 61 24,309 232 25,794 31,522

24 21 21 223 244 31 102 134 36 78 75 59 561 5,760 139 7,508 14,841

7 72 9 50 138 138

58 119 13 190 190

6,336 25,127 59 31,522

8,320 6,494 27 14,841

79 59 138

119 58 13 190

(e) Grants General Purpose (Untied) Financial Assistance - General Component Financial Assistance - Local Roads Component Pensioners' Rates Subsidies - General Component Total General Purpose Specific Purpose Pensioners' Rates Subsidies: - Water - Sewerage - Domestic Waste Management Water Supplies Sewerage Services Bushfire & Emergency Services Child Care Community Care Services DEEWR - Footpaths Employment & Training Programs Heritage & Cultural Library - per capita Noxious Weeds RMS - Road Safety Program Rural Addressing Strengthening Basin Communities Street Lighting Transport (Roads to Recovery) Transport (Other Roads & Bridges Funding) Other Total Specific Purpose

Total Grants Grant Revenue is attributable to:

- Commonwealth Funding - State Funding - Other Funding

page 34

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 3. Income from Continuing Operations (continued) 2013 Operating

2012 Operating

2013 Capital

2012 Capital

96 4 5 105

99 21 41 161

21 4,724 4,745

3,454 3,454

2,183 28 2,211

159 5 164

4,850

3,615

2,211

164

36,372

18,456

2,349

354

Actual 2013

Actual 2012

Unexpended at the Close of the Previous Reporting Period add: Grants & contributions recognised in the current period but not yet spent: less: Grants & contributions recognised in a previous reporting period now spent:

1,333 1,779 (363)

2,464 363 (1,494)

Net Increase (Decrease) in Restricted Assets during the Period

1,416

(1,131)

2,749

1,333

1,489 709 551 2,749

616 579 138 1,333

$ '000

(f) Contributions Developer Contributions: (s93 & s94 - EP&A Act, s64 of the LGA):

S 94A - Fixed Development Consent Levies S 64 - Water Supply Contributions S 64 - Sewerage Service Contributions Total Developer Contributions Other Contributions: Roads & Bridges RMS Contributions (Regional Roads, Block Grant) Other Total Other Contributions

Total Contributions TOTAL GRANTS & CONTRIBUTIONS

$ '000

(g) Restrictions relating to Grants and Contributions Certain grants & contributions are obtained by Council on condition that they be spent in a specified manner:

Unexpended and held as Restricted Assets Comprising: - Specific Purpose Unexpended Grants - Developer Contributions - Other Contributions

page 35

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 4. Expenses from Continuing Operations $ '000

Notes

Actual 2013

Actual 2012

12,102 2,731 1,005 398 683 93 51 426 285 17,774 (547)

10,877 2,452 909 404 569 56 44 503 219 16,033 (338)

(a) Employee Benefits & On-Costs Salaries and Wages Employee Leave Entitlements (ELE) Superannuation - Defined Contribution Plans Superannuation - Defined Benefit Plans Workers' Compensation Insurance Fringe Benefit Tax (FBT) Payroll Tax Training Costs (other than Salaries & Wages) Other Total Employee Costs less: Capitalised Costs

TOTAL EMPLOYEE COSTS EXPENSED Number of "Equivalent Full Time" Employees at year end

17,227

15,695

210

2,465 2,465

2,542 2,542

160 160

82 82

2,625

2,624

(b) Borrowing Costs (i) Interest Bearing Liability Costs Interest on Loans Total Interest Bearing Liability Costs Expensed (ii) Other Borrowing Costs Discount adjustments relating to movements in Provisions (other than ELE) - Remediation Liabilities Total Other Borrowing Costs

TOTAL BORROWING COSTS EXPENSED

page 36

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 4. Expenses from Continuing Operations (continued) $ '000

Notes

Actual 2013

Actual 2012

38,737 86 84

20,936 88 71

15 127 175

57 134 225

(c) Materials & Contracts Raw Materials & Consumables Contractor & Consultancy Costs Auditors Remuneration (1) Legal Expenses: - Legal Expenses: Planning & Development - Legal Expenses: Debt Recovery - Legal Expenses: Other Operating Leases: - Operating Lease Rentals: Minimum Lease Payments (2)

183

207

39,407

21,718

- Audit & review of financial statements: Council's Auditor - Auditors Remuneration - Council's Internal Auditor Remuneration for audit and other assurance services

54 30 84

51 20 71

Total Auditor Remuneration

183 183

207 207

TOTAL MATERIALS & CONTRACTS 1. Auditor Remuneration During the year, the following fees were incurred for services provided by the Council's Auditor (& the Auditors of other Consolidated Entities): (i) Audit and Other Assurance Services

2. Operating Lease Payments are attributable to:

Other

page 37

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 4. Expenses from Continuing Operations (continued) Impairment Costs $ '000

Notes

Depreciation/Amortisation

Actual 2013

Actual 2012

Actual 2013

Actual 2012

1,250 250 33 282 259 852

1,298 232 114 467 336 1,132

5,710 205 995 931 32 518 11,317 -

5,616 205 973 1,005 17 11,395 -

11,317

11,395

(d) Depreciation, Amortisation & Impairment Plant and Equipment Office Equipment Furniture & Fittings Buildings - Non Specialised Buildings - Specialised Other Structures Infrastructure: - Roads, Bridges & Footpaths - Stormwater Drainage - Water Supply Network - Sewerage Network - Other Infrastructure Asset Reinstatement Costs 9 & 26 Total Depreciation & Impairment Costs less: Impairments (to)/from ARR [Equity] 9a

TOTAL DEPRECIATION & IMPAIRMENT COSTS EXPENSED

(23,904) (23,904) 23,904

31,831 31,831 (31,831)

$ '000

Notes

Actual 2013

Actual 2012

36 250 22 99 141 116 77 1,178 494 504 301

2 242 22 113 115 63 1,063 430 340 349

3,218

2,739

(e) Other Expenses Other Expenses for the year include the following: Bad & Doubtful Debts Contributions/Levies to Other Levels of Government - NSW Rural Fire Service Levy Councillor Expenses - Mayoral Fee Councillor Expenses - Councillors' Fees Councillors' Expenses (incl. Mayor) - Other (excluding fees above) Donations, Contributions & Assistance to other organisations (Section 356) Election Expenses Electricity & Heating Insurance Street Lighting Telephone & Communications

TOTAL OTHER EXPENSES

page 38

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 5. Gains or Losses from the Disposal of Assets $ '000

Notes

Actual 2013

Actual 2012

46 (91) (45)

Property (excl. Investment Property) Proceeds from Disposal - Property less: Carrying Amount of Property Assets Sold / Written Off Net Gain/(Loss) on Disposal

Plant & Equipment Proceeds from Disposal - Plant & Equipment less: Carrying Amount of P&E Assets Sold / Written Off Net Gain/(Loss) on Disposal

497 (558) (61)

1,193 (1,167) 26

(686) (686)

(1,045) (1,045)

4,014 (3,521) 493

11,271 (10,660) 611

(299)

(408)

Infrastructure Proceeds from Disposal - Infrastructure less: Carrying Amount of Infrastructure Assets Sold / Written Off Net Gain/(Loss) on Disposal

Financial Assets* Proceeds from Disposal / Redemptions / Maturities - Financial Assets less: Carrying Amount of Financial Assets Sold / Redeemed / Matured Net Gain/(Loss) on Disposal

NET GAIN/(LOSS) ON DISPOSAL OF ASSETS * Financial Assets disposals / redemptions include: - Net Gain/(Loss) from Financial Instruments "At Fair Value through profit & loss"

Net Gain/(Loss) on Disposal of Financial Instruments

493

611

493

611

page 39

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 6a. - Cash Assets and Note 6b. - Investments

$ '000

Notes

2013

2012

Actual Current

Actual Non Current

Actual Current

Actual Non Current

11,151

3,237

10,500 21,651

9,413 12,650

933 678 1,611

1,000 884 1,884

1,824 1,824

23,262

14,534

1,824

21,651

12,650

1,611 1,611

1,884 1,884

1,824 1,824

9,111 99 1,000 (8,326) 1,884

4,398 (240) (2,334) 1,824

884 1,000 1,884

1,824 1,824

Cash & Cash Equivalents (Note 6a) Cash on Hand and at Bank Cash-Equivalent Assets1 - Short Term Deposits Total Cash & Cash Equivalents

Investments (Note 6b) - Long Term Deposits - Equity Linked Notes/Capital Protected Notes - CDO's Total Investments

TOTAL CASH ASSETS, CASH EQUIVALENTS & INVESTMENTS 1

Those Investments where time to maturity (from date of purchase) is < 3 mths.

Cash, Cash Equivalents & Investments were classified at year end in accordance with AASB 139 as follows: Cash & Cash Equivalents a. "At Fair Value through the Profit & Loss" Investments a. "At Fair Value through the Profit & Loss" - "Held for Trading"

6(b-i)

Investments

Note 6(b-i) Reconciliation of Investments classified as "At Fair Value through the Profit & Loss" Balance at the Beginning of the Year Revaluations (through the Income Statement) Additions Disposals (sales & redemptions) Transfers between Current/Non Current Balance at End of Year

1,884 1,293 (2,245) 679 1,611

1,824 131 (1,276) (679) -

Comprising:

- Equity Linked Notes/Capital Protected Notes - CDO's - Other Long Term Financial Assets Total

933 678 1,611

page 40

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 6c. Restricted Cash, Cash Equivalents & Investments - Details

$ '000

Total Cash, Cash Equivalents and Investments

2013

2012

Actual Current

Actual Non Current

Actual Current

Actual Non Current

23,262

14,534

1,824

10,641 11,490 1,131 23,262

6,034 7,217 1,283 14,534

1,824 1,824

Opening Balance

Transfers to Restrictions

238 1,737 147 2,122

1,030 1,030

(461) (43) (504)

807 1,694 147 2,648

247 133 199 138 616 3,589 814 5,736 7,858

109 8 13 27,358 6,999 837 4 35,328 36,358

(26,945) (6,128) (33,073) (33,577)

356 141 212 551 1,489 4,426 818 7,993 10,641

attributable to:

External Restrictions (refer below) Internal Restrictions (refer below) Unrestricted

2013 $ '000

Transfers from Restrictions

Closing Balance

Details of Restrictions External Restrictions - Included in Liabilities Specific Purpose Unexpended Loans-General (A) Specific Purpose Unexpended Loans-Water (A) Specific Purpose Unexpended Loans-Sewer (A) External Restrictions - Included in Liabilities External Restrictions - Other Developer Contributions - General (D) Developer Contributions - Water Fund (D) Developer Contributions - Sewer Fund (D) RMS (formerly RTA) Contributions (E) Specific Purpose Unexpended Grants (F)

Sewerage Services (G) Northern Regional Library

External Restrictions - Other Total External Restrictions

A Loan moneys which must be applied for the purposes for which the loans were raised.

D Development contributions which are not yet expended for the provision of services and amenities in accordanc with contributions plans (refer Note 17). E RMS Contributions which are not yet expended for the provision of services and amenities in accordance with those contributions. F Grants which are not yet expended for the purposes for which the grants were obtained. (refer Note 1) G Water, Sewerage, Domestic Waste Management (DWM) & other Special Rates/Levies/Charges are externally restricted assets and must be applied for the purposes for which they were raised. page 41

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 6c. Restricted Cash, Cash Equivalents & Investments - Details (continued) 2013 $ '000

Internal Restrictions Plant & Vehicle Replacement Employees Leave Entitlement Aerodromes Asset Replacement Capital Replacement Sewer Community Infrastructure (Sec 94) Economic Development Special Rate Levy (SRL) Election Reserve Gravel Pits Jellicoe Park Medical Accommodation Occupational Health and Safety Onsite Effluent Pool Asset Reserve Property Acquisitions Street Lighting Reserve Regional and Local Infrastructure Program Road Sustainability Fund Welcome and Entrance Signage Waste Asset Replacement Reserve RMS Contract Retention Saleyards Reserve Sportsground Improvements Revotes Community Development Program Total Internal Restrictions TOTAL RESTRICTIONS

Opening Balance

Transfers to Restrictions

Transfers from Restrictions

Closing Balance

1,489 735 419 17 2,208 11 133 151 323 17 16 87 80 286 60 94 7 969 60 55 7,217

502 40 166 1,464 430 195 24 192 13 13 350 240 4,097 210 1,657 183 12 466 25 10,279

(284) (56) (742) (102) (207) (77) (3) (636) (94) (3,021) (131) (411) (242) (6,006)

1,707 775 529 739 2,536 11 121 98 515 30 26 87 80 300 7 2,045 60 134 1,246 183 12 224 25 11,490

15,075

46,637

(39,583)

22,131

page 42

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 7. Receivables $ '000

Notes

Purpose Rates & Annual Charges Interest & Extra Charges Interest & Extra Charges (User Charges) User Charges & Fees Accrued Revenues - Interest on Investments - Other Income Accruals Government Grants & Subsidies Net GST Receivable Other Debtors Total

2013 Current Non Current

2012 Current Non Current

2,233 229 45 2,526

2,265 371 66 2,487

65 3,680 114 8,892

59 117 3,818 596 73 9,852

less: Provision for Impairment

Rates & Annual Charges User Charges & Fees Total Provision for Impairment - Receivables

TOTAL NET RECEIVABLES

(290) (120) (410)

8,482

9,442

149 1,431

199 1,300

480 228 2,288

458 370 2,327

Externally Restricted Receivables Water Supply

- Rates & Availability Charges - Other Sewerage Services

- Rates & Availability Charges - Other Total External Restrictions Internally Restricted Receivables Nil Unrestricted Receivables TOTAL NET RECEIVABLES

6,194

7,115

8,482

9,442

Notes on Debtors above: (i) Rates & Annual Charges Outstanding are secured against the property. (ii) Doubtful Rates Debtors are provided for where the value of the property is less than the debt outstanding. An allowance for other doubtful debts is made when there is objective evidence that a receivable is impaired. (iii) Interest was charged on overdue rates & charges at 10.00% (2012 11.00%). Generally all other receivables are non interest bearing. (iv) Please refer to Note 15 for issues concerning Credit Risk and Fair Value disclosures. page 43

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 8. Inventories & Other Assets $ '000

Notes

Inventories Stores & Materials Total Inventories

2013 Current Non Current

2012 Current Non Current

1,077 1,077

1,166 1,166

405 405

305 305

1,482

1,471

Water Stores & Materials Prepayments Total Water

116 1 117

145 1 146

Sewerage Stores & Materials Total Sewerage

116 116

145 145

233 1,249 1,482

291 1,180 1,471

Other Assets Prepayments Total Other Assets

TOTAL INVENTORIES / OTHER ASSETS

Externally Restricted Assets

Domestic Waste Management Nil Other Nil Total Externally Restricted Assets Total Internally Restricted Assets Total Unrestricted Assets TOTAL INVENTORIES & OTHER ASSETS

page 44

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 9a. Infrastructure, Property, Plant & Equipment Asset Movements during the Reporting Period as at 30/6/2012

$ '000 Plant & Equipment Plant & Equipment (WIP) Office Equipment Office Equipment (WIP) Furniture & Fittings Furniture & Fittings (WIP)

Cost

Fair Value

as at 30/6/2013

Accumulated Dep'n

Carrying

Impairment

Asset Additions

WDV of Asset Disposals

Depreciation Expense

Impairment Reversal (via Equity)

Revaluation Revaluation Tfrs Adjustments Decrements Increments from/(to) Inv. & Transfers to Equity to Equity Properties (ARR) (ARR)

WIP Transfers

Value

19,508 3,886 15 1,236 26

10,883 2,546 891 -

8,625 1,340 15 345 26

2,403 134 251 369 99 402

(558) -

(1,250) (250) (33) -

10,857 3 6,005 234 24,430 51 25,291 10,527 23,368 2,507

9,891 15,695 9,710 -

10,857 3 6,005 234 14,539 51 9,596 10,527 13,658 2,507

172 9 104 36 431 315 197

(91) -

(282)

262,467 1,847 20,486 684 69,603 853 50,158 341 -

78,487 7,129 26,610 24,275 -

183,980 1,847 13,357 684 42,993 853 25,883 341 -

3,164 6,510 97 25 200 108 193 9 312

(686) -

365

364

722 43

89 15

633 28

1,378 22

535,513

186,222

349,291

16,940

100 1 -

Cost

Fair Value

Accumulated Dep'n

Carrying

Impairment

Value

20,643 135 4,136 384 1,316 428

11,323 2,795 905 -

9,320 135 1,341 384 411 428

16,025 17,952 395 -

8,989 4,182 37,335 26 32,619 10,958 13,898 2,705

6,924 5,294 1,891 -

8,989 4,182 30,411 26 27,325 10,958 12,007 2,705

Land:

- Operational Land - Operational Land (WIP) - Community Land - Community Land (WIP) Buildings - Non Specialised Buildings - Non Specialised (WIP) Buildings - Specialised Buildings - Specialised (WIP) Other Structures Other Structures (WIP)

(259) (852)

(1) (234) 25 (25) 235 -

(2) (1,744) 1

(145) -

(1,804) (1,832) -

Infrastructure:

Roads, Bridges, Footpaths Roads, Bridges, Footpaths (WIP) Stormwater Drainage Stormwater Drainage (WIP) Water Supply Network Water Supply Network (WIP) Sewerage Network Sewerage Network (WIP) Other Infrastructure

23,904 -

446 1,198

1,052 632 -

299,699 8,357 20,583 709 71,545 961 51,608 350 1,856

83,795 7,334 28,295 25,831 378

10,806 -

205,098 8,357 13,249 709 43,250 961 25,777 350 1,478

365

364

(515) (3)

3,100 65

1,604 18

1,496 47

(11,317)

23,904

36,056

596,952

176,388

10,806

409,758

(5,710) (205) (995) (931) (32)

Other Assets:

- Other

Reinstatement, Rehabilitation & Restoration Assets (refer Note 26)

- Tip Asset - Quarry Asset

TOTAL INFRASTRUCTURE, PROPERTY, PLANT & EQUIP.

(1,335)

(145)

(3,636)

Additions to Depreciable Land Improvements, Buildings, Other Structures & Infrastructure Assets are made up of Asset Renewals ($10.857M) and New Assets ($4.686M). Renewals are defined as the replacement of existing assets (as opposed to the acquisition of new assets). Financial Statements 2013

page 45

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 9b. Externally Restricted Infrastructure, Property, Plant & Equipment $ '000 Class of Asset

Actual

2013

2012

Cost

A/Dep &

Fair Value Impairm't

Carrying Value

Cost

A/Dep &

Fair Value Impairm't

Carrying Value

Water Supply Plant & Equipment

372

240

132

372

217

155

Office Equipment

Furniture & Fittings

- Operational Land

557

548

- Community Land

878

395

483

878

381

497

Land

Buildings

Infrastructure (WIP)

962

853

Infrastructure Total Water Supply

71,441

28,280

69,603

26,610

962

73,341

28,985

43,161 45,318

853

71,494

27,273

42,993 45,074

Plant & Equipment

294

212

292

228

Office Equipment

Furniture & Fittings

- Operational Land

301

- Community Land

1,404

585

819

1,404

568

836 167

Other Structures

Sewerage Services

Land

Buildings Other Structures Infrastructure (WIP) Infrastructure Total Sewerage Services TOTAL RESTRICTED I,PP&E

266

105

161

266

350

341

51,557

25,829

50,158

24,275

350

53,845

26,610

25,728 27,585

341

52,444

25,013

25,883 27,772

1,312

127,186

55,595

72,903

1,194

123,938

52,286

72,846

Note 9c. Infrastructure, Property, Plant & Equipment - Current Year Impairments $ '000

Notes

Actual 2013

Actual 2012

23,904 23,904

(31,831) (31,831)

23,904

(31,831)

Impairment Losses recognised direct to Equity (ARR) incl: Roads, Bridges, Footpaths

Total Impairment Losses

IMPAIRMENT of ASSETS - DIRECT to EQUITY (ARR)

20 (ii)

page 46

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 10a. Payables, Borrowings & Provisions $ '000

Notes

2013 Current Non Current

2012 Current Non Current

Payables Goods & Services - operating expenditure Accrued Expenses: - Borrowings - Other Expenditure Accruals Northern Regional Library Security Bonds, Deposits & Retentions Other Total Payables

4,577

2,414

336 260 818 497 6,488

347 478 892 538 4 4,673

959 959

33,214 33,214

873 873

33,146 33,146

1,428 350 2,011 170

72 -

1,298 375 1,928 139

67 -

Borrowings Loans - Secured 1 Total Borrowings

Provisions Employee Benefits;

Annual Leave Sick Leave Long Service Leave Other Leave Sub Total - Aggregate Employee Benefits

Asset Remediation/Restoration (Future Works)

3,959

3,740

1,500 5,459

2,386 2,458

1,000 4,740

1,311 1,378

12,906

35,672

10,286

34,524

Total Provisions

Total Payables, Borrowings & Provisions

(i) Liabilities relating to Restricted Assets

2013 Current Non Current

2012 Current Non Current

Externally Restricted Assets

1,448 236 1,684

7,576 3,509 11,085

2,206 342 2,548

7,724 3,635 11,359

1,684 11,222

11,085 24,587

2,548 7,738

11,359 23,165

12,906

35,672

10,286

34,524

Water Sewer Liabilities relating to externally restricted assets Internally Restricted Assets

Nil Total Liabilities relating to restricted assets Total Liabilities relating to Unrestricted Assets TOTAL PAYABLES, BORROWINGS & PROVISIONS 1.

Loans are secured over the General Rating Income of Council Disclosures on Liability Interest Rate Risk Exposures, Fair Value Disclosures & Security can be found in Note 15. page 47

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 10a. Payables, Borrowings & Provisions (continued) $ '000

Actual 2013

Actual 2012

2,462 2,462

1,159 1,159

(ii) Current Liabilities not anticipated to be settled within the next 12 months The following Liabilities, even though classified as current, are not expected to be settled in the next 12 months. Provisions - Employees Benefits

Note 10b. Description of and movements in Provisions 2012

Class of Provision Annual Leave Sick Leave Long Service Leave Other Leave Asset Remediation

TOTAL

Opening Balance as at 1/7/12

1,298 375 1,995 139 2,311 6,118

2013 Additional Decrease due to Provisions Payments

1,013 438 527 270 1,575 3,823

(1,063) (455) (372) (239) (2,129)

Remeasurement effects due to Discounting

180 (8) (67) 105

Unused amounts reversed

Closing Balance as at 30/6/13

1,428 350 2,083 170 3,886 7,917

a. Employees Leave Entitlements & On-Costs represents those benefits accrued and payable and an estimate of those that will become payable in the future as a result of past service. b. Asset Remediation, Reinstatement & Restoration Provisions represent the Present Value estimate of future costs Council will incur in order to remove, restore & remediate assets &/or activities as a result of past operations.

page 48

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 11. Statement of Cash Flows - Additional Information $ '000

Notes

Actual 2013

Actual 2012

21,651 21,651

12,650 12,650

6,475

821

11,317 299

11,395 408

(a) Reconciliation of Cash Assets Total Cash & Cash Equivalent Assets Less Bank Overdraft BALANCE as per the STATEMENT of CASH FLOWS

6a 10

(b) Reconciliation of Net Operating Result to Cash provided from Operating Activities Net Operating Result from Income Statement Adjust for non cash items:

Depreciation & Amortisation Net Losses/(Gains) on Disposal of Assets Losses/(Gains) recognised on Fair Value Re-measurements through the P&L: - Investments classified as "At Fair Value" or "Held for Trading" Unwinding of Discount Rates on Reinstatement Provisions

(1,424) 160

141 82

+/- Movement in Operating Assets and Liabilities & Other Cash Items:

Decrease/(Increase) in Receivables Decrease/(Increase) in Inventories Decrease/(Increase) in Other Assets Increase/(Decrease) in Payables Increase/(Decrease) in accrued Interest Payable Increase/(Decrease) in other accrued Expenses Payable Increase/(Decrease) in Other Liabilities Increase/(Decrease) in Employee Leave Entitlements Increase/(Decrease) in Other Provisions NET CASH PROVIDED FROM/(USED IN) OPERATING ACTIVITIES from the STATEMENT of CASH FLOWS

960 89 (100) 2,163 (11) (218) (119) 224 1,415 21,230

(2,380) (294) (175) (622) 6 253 516 125 25 10,301

page 49

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 11. Statement of Cash Flows - Additional Information (continued) $ '000

Notes

Actual 2013

Actual 2012

100 75 175

9 9

3 3

(d) Financing Arrangements (i) Unrestricted access was available at balance date to the following lines of credit: Bank Overdraft Facilities (1) Credit Cards / Purchase Cards Total Financing Arrangements Amounts utilised as at Balance Date: - Credit Cards / Purchase Cards Total Financing Arrangements Utilised 1. The Bank overdraft facility may be drawn at any time and may be terminated by the bank without notice. Interest rates on overdrafts are Interest Rates on Loans & Other Payables are disclosed in Note 15.

(ii) Secured Loan Liabilities Loans are secured by a mortgage over future years Rate Revenue only.

page 50

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 12. Commitments for Expenditure $ '000

Notes

Actual 2013

Actual 2012

1,370 140 2,595 84,871 6,470 6,235 4,070 16,891 122,642

2,681 487 10,173 4,553 61,775 6,450 1,235 7,840 4,251 847 100,292

29,123 41,636 51,883 122,642

15,232 46,789 38,271 100,292

65,503 22,132 13,337 21,580 90 122,642

67,175 19,367 11,020 2,730 100,292

(a) Capital Commitments (exclusive of GST) Capital expenditure committed for at the reporting date but not recognised in the financial statements as liabilities: Property, Plant & Equipment Buildings Plant & Equipment Other Structures Land Engineering Infrastructure Sewer Infrastructure Waste Infrastructure Water Infrastructure Other Infrastructure Other Total Commitments These expenditures are payable as follows:

Within the next year Later than one year and not later than 5 years Later than 5 years Total Payable Sources for Funding of Capital Commitments:

Unrestricted General Funds Future Grants & Contributions Internally and Externally Restricted Reserves Unexpended and New Loans (to be raised) Other Funding Total Sources of Funding

page 51

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 12. Commitments for Expenditure (continued) $ '000

Notes

Actual 2013

Actual 2012

99 133 232

119 236 355

(b) Finance Lease Commitments Nil

(c) Operating Lease Commitments (Non Cancellable) a. Commitments under Non Cancellable Operating Leases at the Reporting date, but not recognised as Liabilities are payable: Within the next year Later than one year and not later than 5 years Later than 5 years Total Non Cancellable Operating Lease Commitments

b. Non Cancellable Operating Leases include the following assets: Computer Equipment, Miscellaneous Plant & Equipment Contingent Rentals may be payable depending on the condition of items or usage during the lease term. Conditions relating to Operating Leases: - All Operating Lease Agreements are secured only against the Leased Asset. - No Lease Agreements impose any financial restrictions on Council regarding future debt etc.

(d) Investment Property Commitments Nil

(e) Investment in Associates / Joint Ventures - Commitments For Capital Commitments and Other Commitments relating to Investments in Associates & Joint Ventures, refer to Note 19 (b)

page 52

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13a(i). Statement of Performance Measurement - Indicators (Consolidated) Amounts 2013

$ '000

Indicator 2013

Prior Periods 2012 2011

20,064 8,760

2.29 : 1

2.55

3.10

3,341 47,575

7.02%

7.62%

6.65%

25,017 80,568

31.05%

42.07%

44.37%

2,172 27,679

7.85%

9.15%

8.42%

10,857 8,382

129.53%

131.53%

89.41%

Local Government Industry Indicators - Consolidated 1. Unrestricted Current Ratio Current Assets less all External Restrictions (1) Current Liabilities less Specific Purpose Liabilities

(2,3)

2. Debt Service Ratio Debt Service Cost Income from Continuing Operations (excl. Capital Items & Specific Purpose Grants/Contributions)

3. Rates & Annual Charges Coverage Ratio Rates & Annual Charges Income from Continuing Operations

4. Rates, Annual Charges, Interest & Extra Charges Outstanding Percentage Rates, Annual & Extra Charges Outstanding Rates, Annual & Extra Charges Collectible

5. Building & Infrastructure Renewals Ratio Asset Renewals(4) Depreciation, Amortisation & Impairment

Notes (1)

Refer Notes 6-8 inclusive. Also excludes any Real Estate & Land for resale not expected to be sold in the next 12 months

(2)

Refer to Note 10(a).

(3)

Refer to Note 10(a)(ii) - excludes all payables & provisions not expected to be paid in the next 12 months (incl. ELE).

(4)

Asset Renewals represent the replacement &/or refurbishment of existing assets to an equivalent capacity/performance as opposed to the acquisition of new assets (or the refurbishment of old assets) that increases capacity/performance. Asset Renewals include building and infrastructure assets only. page 53

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13a(i). Statement of Performance Measurement - Indicators (Consolidated) Amounts 2013

$ '000

Indicator 2013

Prior Periods 2012 2011

TCorp Performance Measures - Consolidated a. Operating Performance Operating Revenue (excl. Capital Grants & Contributions) - Operating Expenses Operating Revenue (excl. Capital Grants & Contributions)

2,702 76,795

3.52%

1.10%

38,375 79,144

48.49%

62.55%

20,064 8,760

2.29

2.55

16,644 3,501

4.75

4.26

15,605 11,317

1.38

23,239 358,595

0.06

0.11

19,837 29,959

0.66

0.51

10,857 8,382

1.30

1.32

21,651 5,013

4.32

3.74

16,644 2,625

6.34

5.57

b. Own Source Operating Revenue Rates & Annual Charges + User Charges & Fees Total Operating Revenue (incl. Capital Grants & Contributions)

c. Unrestricted Current Ratio Current Assets less all External Restrictions Current Liabilities less Specific Purpose Liabilities

d. Debt Service Cover Ratio Operating Result before Interest & Depreciation (EBITDA) Principal Repayments (from the Statement of Cash Flows) + Borrowing Interest Costs (from the Income Statement)

e. Capital Expenditure Ratio Annual Capital Expenditure Annual Depreciation

f. Infrastructure Backlog Ratio Estimated Cost to bring Assets to a Satisfactory Condition Total value of Infrastructure, Building, Other Structures & Depreciable Land Improvement Assets

g. Asset Maintenance Ratio Actual Asset Maintenance Required Asset Maintenance

h. Building & Infrastructure Renewals Ratio Asset Renewals Depreciation of Building and Infrastructure Assets

i. Cash Expense Cover Ratio Current Year's Cash & Cash Equivalents (Total Expenses - Depreciation - Interest Costs)

x12

j. Interest Cover Ratio Operating Results before Interest & Depreciation (EBITDA) Borrowing Interest Costs (from the income statement)

page 54

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13a(ii). Local Government Industry Indicators - Graphs (Consolidated) Purpose of Unrestricted Current Ratio

1. Unrestricted Current Ratio 5.0 Ratio : 1

4.0 3.0

2.71

3.10

2.55

2.29

2.0 1.0 0.0 2010

2011

2012

2013

2. Debt Service Ratio

Purpose of Debt Service Ratio

12% Ratio %

10% 8%

6.88%

6.65%

7.62%

7.02%

To assess the impact of loan principal & interest repayments on the discretionary revenue of council.

6% 4% 2% 0% 2010

2011

2012

2013

3. Rates & Annual Charges Coverage Ratio 100%

Ratio %

80% 60%

41.65%

44.37%

2010

2011

42.07%

40%

31.05%

20% 0% 2012

2013

Ratio %

4. Rates, Annual Charges, Interest & Extra Charges Outstanding Percentage 14% 12% 10% 8% 6% 4% 2% 0%

9.63%

2010

150%

8.42%

2011

9.15%

2012

Ratio %

7.85%

2013

5. Building & Infrastructure Renewals Ratio 131.53%

130%

89.41% 74.94%

70% 2010

2011

2012

Purpose of Rates & Annual Charges Coverage Ratio To assess the degree of Council's dependence upon revenue from rates and annual charges and to assess the security of Council's income.

2012/13 Ratio

2.29 : 1

This ratio has remained strong over the last 6 years, showing Council has a strong ability to meet its short term liabilities when they are required to be paid due to adequate levels of working capital.

Commentary on 2012/13 Result 2012/13 Ratio

7.02%

This ratio has decreased slightly over the last twelve months. Loan repayments have remained constant but income increased causing the slight reduction. In 2014/2015 this ratio is estimated to be 11% followed by reductions over the following ten years. Commentary on 2012/13 Result 2012/13 Ratio

31.05%

This ratio has decreased dramatically over the last twelve months due to the increase in grant funds due to flood damage funding. It is expected to increase over the next two years as the flood damage program is completed, returning to its previous levels of 40-45%.

Purpose of Rates & Annual Charges Outstanding Ratio

Commentary on 2012/13 Result

To assess the impact of uncollected rates and annual charges on Council's liquidity and the adequacy of recovery efforts.

The success of Councils internal and external debt recovery processes put in place to reduce long term outstandings are evident in this ratio improvement. It is expected to remain constant or reduce slightly over the next twelve months.

Purpose of Asset Renewals Ratio

2012/13 Ratio

7.85%

Commentary on 2012/13 Result 2012/13 Ratio

129.53%

110% 90%

To assess the adequacy of working capital and its ability to satisfy obligations in the short term for the unrestricted activities of Council.

Commentary on 2012/13 Result

2013

To assess the rate at which these assets are being renewed relative to the rate at which they are depreciating.

This ratio has remained constant over the last twelve months. This ratio continues to remain high due to the increased expenditure on the sealed road network and the finalisation of the new pool complex. It is expected to remain high next year due to extensive works on water and sewer assets. page 55

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13a(ii). TCorp Performance Measures - Graphs (Consolidated) Purpose of Operating Performance Ratio

Ratio %

a. Operating Performance 7% 6% 5% 4% 3% 2% 1% 0%

3.52%

1.10% 0.00%

2011

2012

2013

b. Own Source Operating Revenue 100% Ratio %

80%

62.55%

60%

48.49%

40% 20% 0%

0.00%

2011

2012

2013

Ratio (x)

2.55

2.29

0.00

2011

2012

2013

d. Debt Service Cover Ratio 6.0 Ratio (x)

5.0

4.26

4.75

4.0 3.0 2.0 1.0 0.0

0.00

2011

2012

2013

e. Capital Expenditure Ratio 1.38

Ratio (x)

1.5

1.38

0.5 0.00

2011

2012

This ratio measures fiscal flexibility. It is the degree of reliance on external funding sources such as operating grants & contributions.

To assess the adequacy of unrestricted working capital and Council's ability to meet short term obligations as they fall due.

Purpose of Debt Service Cover Ratio This ratio measures the availability of operating cash to service debt including interest, principal and lease payments

Purpose of Capital Expenditure Ratio

1.0

0.0

Purpose of Own Source Operating Revenue Ratio

Purpose of Unrestricted Current Ratio

c. Unrestricted Current Ratio 3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0

This ratio measures Councilâ&#x20AC;&#x2122;s achievement of containing operating expenditure within operating revenue.

2013

This ratio assesses the extent to which a Council is expanding its asset base with capital expenditure

(on new assets, replacement & renewal of existing assets).

Commentary on 2012/13 Result 2012/13 Ratio

3.52%

Tcorp has set the benchmark for this ratio at greater than -4.00%. Council has met this benchmark over the last two years.

Commentary on 2012/13 Result 2012/13 Ratio

48.49%

Tcorp has set the benchmark for this ratio at greater than 60.00%. Council met this benchmark in 2012. Excluding flood damage funding in 2013, this ratio would have been approximately 68%.

Commentary on 2012/13 Result 2012/13 Ratio

2.29

Tcorp has set the benchmark for this ratio at greater than 1.50. Council has met this benchmark over the last two years.

Commentary on 2012/13 Result 2012/13 Ratio

4.75 x

Tcorp has set the benchmark for this ratio at greater than 2.00. Council has met this benchmark over the last two years.

Commentary on 2012/13 Result 2012/13 Ratio

1.38 x

Tcorp has set the benchmark for this ratio at greater than 1.10. Council has met this benchmark over the last two years.

page 56

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13a(ii). TCorp Performance Measures - Graphs (Consolidated) continued

Ratio (x)

f. Infrastructure Backlog Ratio 0.14 0.12 0.10 0.08 0.06 0.04 0.02 0.00

0.11 0.06

0.00

2011

2012

2013

Ratio (x)

g. Asset Maintenance Ratio 0.80 0.70 0.60 0.50 0.40 0.30 0.20 0.10 0.00

0.66 0.51

0.00

2011

2.10

2013

h. Building & Infrastructure Renewals Ratio 1.32

1.60 Ratio (x)

2012

0.10 -0.40

0.00

2011

2012

2013

-0.90 i. Cash Expense Cover Ratio 6.0 Ratio (mths)

5.0

3.74

4.0 2.0 0.0

0.00

2011

2012

2013

Ratio (x)

j. Interest Cover Ratio 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0.00

5.57

2012

Compares actual vs. required annual asset maintenance. A ratio of > 1.0x indicates enough has been spent to stop the Infrastructure Backlog from growing.

Purpose of Asset Renewals Ratio To assess the rate at which these assets are being renewed relative to the rate at which they are depreciating.

Purpose of Cash Expense Cover Ratio This liquidity ratio indicates the number of months a Council can continue paying for its immediate expenses without additional cash inflow.

Purpose of Interest Cover Ratio 6.34

0.00

2011

Purpose of Asset Maintenance Ratio

2012/13 Ratio

0.06 x

Tcorp has set the benchmark for this ratio at less than 0.02. Council did not meet this benchmark in either of the last two years. Council is however seeing gradual improvements due to the increased road resealing program. The unsealed road network continues to have large backlog works required. Commentary on 2012/13 Result 2012/13 Ratio

0.66 x

Tcorp has set the benchmark for this ratio at greater than 1.00. Council did not meet this benchmark in either of the last two years. Council is however seeing gradual imporovements due to the increased road resealing program. The unsealed road network maintenance program continues to be underfunded. Commentary on 2012/13 Result 2012/13 Ratio

1.30 x

Tcorp has set the benchmark for this ratio at greater than 1.00. Council has met this benchmark over the last two years.

Commentary on 2012/13 Result 2012/13 Ratio

4.32 mths

4.32

3.0 1.0

This ratio shows what proportion the backlog is against the total value of a Councilâ&#x20AC;&#x2122;s infrastructure.

Commentary on 2012/13 Result

1.30

1.10 0.60

Purpose of Infrastructure Backlog Ratio

2013

This ratio indicates the extent to which a Council can service (thru operating cash) its interest bearing debt & take on additional borrowings.

Tcorp has set the benchmark for this ratio at greater than 3 months. Council has met this benchmark over the last two years.

Commentary on 2012/13 Result 2012/13 Ratio

6.34 x

Tcorp has set the benchmark for this ratio at greater than 4.00. Council has met this benchmark over the last two years.

page 57

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13b. Statement of Performance Measurement - Indicators (by Fund) $ '000

Water 2013

Sewer 2013

General1 2013

1.17 : 1

22.25 : 1

2.29 : 1

0.76 : 1

15.90 : 1

2.48 : 1

15.06%

10.69%

5.74%

18.94%

10.56%

6.18%

26.63%

75.61%

29.18%

36.84%

75.34%

40.03%

11.84%

18.09%

6.49%

12.03%

15.63%

7.99%

12.66%

8.59%

164.98%

76.98%

22.99%

26.87%

Local Government Industry Indicators - by Fund 1. Unrestricted Current Ratio Current Assets less all External Restrictions (1) Current Liabilities less Specific Purpose Liabilities (2,3) prior period:

2. Debt Service Ratio Debt Service Cost Income from Continuing Operations (excl. Capital Items & Specific Purpose Grants/Contributions)

prior period:

3. Rates & Annual Charges Coverage Ratio Rates & Annual Charges Income from Continuing Operations prior period:

4. Rates, Annual Charges, Interest & Extra Charges Outstanding Percentage Rates, Annual & Extra Charges Outstanding Rates, Annual & Extra Charges Collectible prior period:

5. Building & Infrastructure Renewals Ratio Asset Renewals (Building & Infrastructure assets) Depreciation, Amortisation & Impairment prior period:

Notes (1)

General Fund refers to all of Council's activities except for its Water & Sewer activities which are listed separately. page 58

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 13b. Statement of Performance Measurement - Indicators (by Fund) $ '000

Water 2013

Sewer 2013

General1 2013

2.19%

1.14%

3.73%

94.14%

85.86%

43.60%

1.17

22.25

2.29

8.86

12.63

2.36

0.21

0.20

1.63

0.00

0.08

1.23

1.28

0.59

0.13

0.09

1.65

7.27

26.23

4.73

2.94

4.99

7.61

TCorp Performance Measures - by Fund a. Operating Performance Operating Revenue (excl. Capital Grants & Contributions) Operating Expenses Operating Revenue (excl. Capital Grants & Contributions) prior period:

b. Own Source Operating Revenue Rates & Annual Charges + User Charges & Fees Total Operating Revenue (incl. Capital Grants & Contributions) prior period:

c. Unrestricted Current Ratio Current Assets less all External Restrictions Current Liabilities less Specific Purpose Liabilities prior period:

d. Debt Service Cover Ratio Operating Result before Interest & Depreciation (EBITDA) Principal Repayments (from the Statement of Cash Flows) + Borrowing Interest Costs (from the Income Statement)

prior period:

e. Capital Expenditure Ratio Annual Capital Expenditure Annual Depreciation prior period:

f. Infrastructure Backlog Ratio Estimated Cost to bring Assets to a Satisfactory Condition (from Special Schedule 7) Total value of Infrastructure, Building, Other Structures & Depreciable Land Improvement Assets

prior period:

g. Asset Maintenance Ratio Actual Asset Maintenance Required Asset Maintenance prior period:

h. Building and Infrastructure Renewals Ratio Asset Renewals Depreciation of Building and Infrastructure Assets prior period:

i. Cash Expense Cover Ratio Current Year's Cash & Cash Equivalents (Total Expenses - Depreciation - Interest Costs)

x12 prior period:

j. Interest Cover Ratio Operating Results before Interest & Depreciation (EBITDA) Borrowing Interest Costs (from the income statement) prior period: Notes (1)

General Fund refers to all of Council's activities except for its Water & Sewer activities which are listed separately. page 59

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 14. Investment Properties $ '000

Notes

Actual 2013

Actual 2012

145

145 145

(a) Investment Properties at Fair value Investment Properties on Hand Reconciliation of Annual Movement: - Transfers from/(to) Owner Occupied (Note 9) CLOSING BALANCE - INVESTMENT PROPERTIES

(b) Valuation Basis The basis of valuation of Investment Properties is Fair Value, being the amounts for which the properties could be exchanged between willing parties in arms length transaction, based on current prices in an active market for similar properties in the same location and condition and subject to similar leases. The 2013 revaluations were based on Independent Assessments made by: APV Valuers & Asset Management (Registered Valuers, Engineers and CPAs)

(c) Contractual Obligations at Reporting Date Refer to Note 12 for disclosures relating to any Capital and Service obligations that have been contracted.

page 60

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 15. Financial Risk Management $ '000

Risk Management Council's activities expose it to a variety of financial risks including (1) price risk, (2) credit risk, (3) liquidity risk and (4) interest rate risk. The Council's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the financial performance of the Council. Council does not engage in transactions expressed in foreign currencies and is therefore not subject to foreign currency risk. Financial risk management is carried out by Council's Finance Section under policies approved by the Council. A comparison by category of the carrying amounts and fair values of Council's Financial Assets & Financial Liabilities recognised in the financial statements is presented below. Carrying Value

Financial Assets Cash and Cash Equivalents Investments - "Held for Trading" Receivables Total Financial Assets Financial Liabilities Payables Loans / Advances Total Financial Liabilities

Fair Value

2013

2012

2013

2012

21,651

12,650

21,651

12,650

1,611 8,482 31,744

3,708

1,611 8,482 31,744

3,708

6,488 34,173 40,661

9,442

25,800

4,673 34,019

38,692

6,488 34,173 40,661

9,442

25,800

4,673 34,019

38,692

Fair Value is determined as follows: - Cash & Cash Equivalents, Receivables, Payables - are estimated to be the carrying value which approximates mkt value. - Borrowings & Held to Maturity Investments - are based upon estimated future cash flows discounted by the current market interest rates applicable to assets & liabilities with similar risk profiles, unless quoted market prices are available. - Financial Assets classified (i) "at fair value through profit & loss" or (ii) Available for Sale - are based upon quoted market prices (in active markets for identical investments) at the reporting date or independent valuation.

page 61

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 15. Financial Risk Management (continued) $ '000

(a) Fair Value Measurements The fair value of financial assets and financial liabilities must be estimated in accordance with Accounting Standards for either recognition and measurement requirements or for disclosure purposes. AASB 7 Financial Instruments: Disclosures, requires the disclosure of how fair valuations have been arrived at for all financial assets and financial liabilities that have been measured at fair value. Arriving at fair values for financial assets & liabilities can be broken up into 3 distinct measurement hierarchies: Level 1: Quoted prices (unadjusted) in active markets for identical assets or liabilities Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices) Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs) The following table presents the financial assets and financial liabilities that have been measured & recognised at fair values: 2013 Financial Assets Investments - "Held for Trading" Total Financial Assets

Level 1

Level 2

Level 3

Total

1,611

2012 Financial Assets Investments - "Held for Trading" Total Financial Assets

Level 1

Level 2

Level 3

Total

3,708

page 62

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 15. Financial Risk Management (continued) $ '000

(b) Cash & Cash Equivalents, Financial assets 'at fair value through the profit & loss' "Available-for-sale" financial assets & "Held-to-maturity" Investments Council's objective is to maximise its return on cash & investments whilst maintaining an adequate level of liquidity and preserving capital. Council's Finance area manages the Cash & Investments portfolio with the assistance of independent advisors. Council has an Investment Policy which complies with the Local Government Act & Minister's Investment Order. This Policy is regularly reviewed by Council and it's staff and an Investment Report is tabled before Council on a monthly basis setting out the portfolio breakup and its performance. The major risk associated with Investments is price risk - the risk that the capital value of Investments may fluctuate due to changes in market prices, whether there changes are caused by factors specific to individual financial instruments or their issuers or are caused by factors affecting similar instruments traded in a market. Cash & Investments are also subject to interest rate risk - the risk that movements in interest rates could affect returns and income. A further risk associated with Cash & Investments is credit risk - the risk that the investment counterparty will not complete their obligations particular to a financial instrument, resulting in a financial loss to Council - be it of a capital or income nature. Council manages these risks (amongst other measures) by diversifying its portfolio and only purchasing investments with high credit ratings or capital guarantees. Council also seeks advice from independent advisers before placing any funds in Cash Equivalents & Investments. The following represents a summary of the sensitivity of Council's Income Statement and Accumulated Surplus (for the reporting period) due to a change in either the price of a financial asset or the interest rates applicable. It is assumed that the change in interest rates would have been constant throughout the reporting period. Increase of Values/Rates 2013 Possible impact of a 10% movement in Market Values Possible impact of a 1% movement in Interest Rates

Decrease of Values/Rates

Profit

Equity

Profit

Equity

161 217

(161) (217)

417 164

(417) (164)

2012 Possible impact of a 10% movement in Market Values Possible impact of a 1% movement in Interest Rates

page 63

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 15. Financial Risk Management (continued) $ '000

(c) Receivables Council's major receivables comprise (i) Rates & Annual charges and (ii) User Charges & Fees. The major risk associated with these receivables is credit risk - the risk that debts due and payable to Council may not be repaid in full. Council manages this risk by monitoring outstanding debt and employing stringent debt recovery procedures. It also encourages ratepayers to pay their rates by the due date through incentives. Credit risk on rates and annual charges is minimised by the ability of Council to secure a charge over the land relating to the debts - that is, the land can be sold to recover the debt. Council is also able to charge interest on overdue rates & annual charges at higher than market rates which further encourages the payment of debt. There are no significant concentrations of credit risk, whether through exposure to individual customers, specific industry sectors and/or regions. The level of outstanding receivables is reported to Council monthly and benchmarks are set and monitored for acceptable collection performance. Council makes suitable provision for doubtful receivables as required and carries out credit checks on most non-rate debtors. There are no material receivables that have been subjected to a re-negotiation of repayment terms. A profile of Council's receivables credit risk at balance date follows: 2013

2013

Rates &

(i) Ageing of Receivables Current (not yet overdue) Overdue

(ii) Movement in Provision for Impairment of Receivables Balance at the beginning of the year Balance at the end of the year

2012

Rates &

Annual

Other

Annual

Other

Charges

Receivables

Charges

Receivables

2,233 2,233

6,386 273 6,659

2,265 2,265

7,150 437 7,587

2013

2012

410 410

page 64

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 15. Financial Risk Management (continued) $ '000

(d) Payables & Borrowings Payables & Borrowings are both subject to liquidity risk - the risk that insufficient funds may be on hand to meet payment obligations as and when they fall due. Council manages this risk by monitoring its cash flow requirements and liquidity levels and maintaining an adequate cash buffer. Payment terms can (in extenuating circumstances) also be extended & overdraft facilities utilised as required. The contractual undiscounted cash outflows (ie. principal and interest) of Council's Payables & Borrowings are set out in the liquidity table below: $ '000

Subject to no

payable in:

Total

Actual

Cash

Carrying

Outflows

Values

maturity

â&#x2030;¤ 1 Year

1-2 Yrs

2-3 Yrs

3-4 Yrs

4-5 Yrs

> 5 Yrs

497

5,991

6,488

2013 Trade/Other Payables Loans & Advances Total Financial Liabilities

3,351

3,431

4,292

3,392

3,316

55,800

73,582

34,173

497

9,342

3,431

4,292

3,392

3,316

55,800

80,070

40,661

538

4,135

4,673

3,343

3,304

3,228

54,403

70,925

34,019

538

7,478

3,343

3,304

3,228

54,403

75,598

38,692

2012 Trade/Other Payables Loans & Advances Total Financial Liabilities

Borrowings are also subject to interest rate risk - the risk that movements in interest rates could adversely affect funding costs & debt servicing requirements. Council manages this risk through the diversification of borrowing types, maturities & interest rate structures. The following interest rates were applicable to Council's Borrowings at balance date: Trade/Other Payables Loans & Advances - Fixed Interest Rate

2013

2012

Carrying

Average

Value

Interest Rate

6,488 34,173 40,661

0.0% 7.2%

Carrying

Average

Value

Interest Rate

4,673 34,019 38,692

0.0% 7.3%

page 65

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 16. Material Budget Variations $ '000

Council's Original Financial Budget for 12/13 was adopted by the Council on 07 June 2012. While the Income Statement included in this General Purpose Financial Report must disclose the Original Budget adopted by Council, the Local Government Act requires Council to review its Financial Budget on a Quarterly Basis, so that it is able to manage the various variations between actuals versus budget that invariably occur throughout the year. This Note sets out the details of MATERIAL VARIATIONS between Council's Original Budget and its Actual results for the year as per the Income Statement - even though such variations may have been adjusted for during each Quarterly Budget Review. Note that for Variations* of Budget to Actual :

Material Variations represent those variances that amount to 10% or more of the original budgeted figure. F = Favourable Budget Variation, U = Unfavourable Budget Variation

$ '000

REVENUES Rates & Annual Charges

2013 Budget

25,312

2013 Actual

25,017

2013 ---------- Variance* ----------

(295)

(1%)

9,676 13,358 3,682 F User Charges & Fees 38% Fees received in relation to work undertaken on State Roads for the Roads & Maritime Services (RMS) exceeded budget by approximately $3,600,000. The value of contract works to be undertaken in any given year on State Roads is unknown at the time of budget adoption. 1,101

2,279

1,178

107%

910 Other Revenues A refund of $150,000 on Workers Compensation Premiums

1,193

283

31%

33,854

36,372

2,518

1,731 2,349 618 Capital Grants & Contributions 36% Additional grant funding was received under the Roads to Recovery program. Projects that were carried over from a previous year were completed in 2012/13 and funding claimed.

Interest & Investment Revenue Fair value movements on investments.

Operating Grants & Contributions

page 66

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 16. Material Budget Variations (continued) $ '000

EXPENSES Employee Benefits & On-Costs

2013 Budget

17,223

2013 Actual

17,227

2013 ---------- Variance* ----------

(4)

2,682 2,625 57 Borrowing Costs The budget for increase of the provision for Gravel Pit and Landfill Remediation was understated. Materials & Contracts

36,283

39,407

(3,124)

(0%)

(9%)

10,229 11,317 (1,088) (11%) Depreciation & Amortisation Original budget based on revaluation of Council Buildings and Other Structures which should see a reduction in depreciation from 2013/14 financial year. Other Expenses

2,963

3,218

(255)

(9%)

1,500 299 1,201 80% Net Losses from Disposal of Assets As a result of flood restoration works being undertaken on a significant proportion of Shire roads Council has deferred capitalisation of reseals (approx. $6.5million) undertaken in the current year to conduct and audit and revaluation of all road infrastructure assets in the 2013/14 financial year.

page 67

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 17. Statement of Developer Contributions $ '000

Council recovers contributions, raises levies & enters into planning agreements on development works that are subject to a development consent issued by Council. All contributions must be spent/utilised for the specific purpose they were levied and any interest applicable to unspent funds must be attributed to remaining funds. The following tables detail the receipt, interest and use of the above contributions & levies and the value of all remaining funds which are "restricted" in their future use.

SUMMARY OF CONTRIBUTIONS & LEVIES PURPOSE

Projections

Opening Balance

Cumulative

Contributions

Interest

Expenditure

Internal

Held as

Exp

Over or

Internal

received during the Year

earned

during

Borrowing

Restricted

Future

still

(under)

Borrowings

in Year

Year

(to)/from

Asset

income

outstanding

Funding

due/(payable)

Cash

Non Cash

249

357

Total S94 Revenue Under Plans

249

357

S64 Contributions

330

352

Total Contributions

579

105

709

Financial Statements 201

page 68

S94A Levies - under a Plan

S94A LEVIES - UNDER A PLAN Projections

Opening Balance

Public Amenities Total

Contributions

Interest

Expenditure

Internal

Held as

Exp

Over or

Internal

received during the Year

earned

during

Borrowing

Restricted

Future

still

(under)

Borrowings

in Year

Year

(to)/from

Asset

income

outstanding

Funding

due/(payable)

Cash

Non Cash

249

357

249

357

page 68

Financial Statements 2013

PURPOSE

Cumulative

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 18. Contingencies & Other Assets/Liabilities Not Recognised $ '000

The following assets and liabilities do not qualify for recognition in the Statement of Financial Position, but their knowledge & disclosure is considered relevant to the users of Council's Financial Report.

(ii) Statewide Limited

LIABILITIES NOT RECOGNISED:

Membership includes the potential to share in either the net assets or liabilities of the fund depending on its past performance. Councilâ&#x20AC;&#x2122;s share of the Net Assets or Liabilities reflects Councils contributions to the pool and the result of insurance claims within each of the Fund Years.

1. Guarantees (i) Defined Benefit Superannuation Contribution Plans Council participates in an employer sponsored Defined Benefit Superannuation Scheme, and makes contributions as determined by the Superannuation Scheme's Trustees.

Council is a member of Statewide Mutual, a mutual pool scheme providing liability insurance to Local Government.

The future realisation and finalisation of claims incurred but not reported to 30/6 this year may result in future liabilities or benefits as a result of past events that Council will be required to fund or share in respectively.

Member Councils bear responsibility of ensuring there are sufficient funds available to pay out the required benefits as they fall due. The Schemes most recent full actuarial review indicated that the Net Assets of the Scheme were not sufficient to meet the accrued benefits of the Schemes Defined Benefit member category with member Councils required to make significantly higher contributions in future years. The Local Government Superannuation Scheme however is unable to provide Council with an accurate estimate of its share of the net deficit and accordingly Council has not recorded any net liability from it's Defined Benefit Scheme obligations in accordance with AASB 119. Future contributions made to the defined benefit scheme to rectify the net deficit position will be recognised as an expense when they become payable - similar to the accounting for Defined Contributions Plans.

(iii) StateCover Limited Council is a member of StateCover Mutual Limited and holds a partly paid share in the entity. StateCover is a company providing workers compensation insurance cover to the NSW Local Government Industry and specifically Council. Council has a contingent liability to contribute further equity in the event of the erosion of the Company's capital base as a result of the company's past performance and/or claims experience or as a result of any increased prudential requirements from APRA. These future equity contributions would be required to maintain the companyâ&#x20AC;&#x2122;s minimum level of Net Assets in accordance with its Licence Requirements. (iv) Other Guarantees Council has provided no other Guarantees other than those listed above.

page 69

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 18. Contingencies & Other Assets/Liabilities Not Recognised (continued) $ '000

LIABILITIES NOT RECOGNISED (continued): 2. Other Liabilities

(iii) Potential Land Acquisitions due to Planning Restrictions imposed by Council

(i) Third Party Claims The Council is involved from time to time in various claims incidental to the ordinary course of business including claims for damages relating to its services. Council believes that it is appropriately covered for all claims through its Insurance Coverage and does not expect any material liabilities to eventuate. (ii) S94 Plans Council levies Section 94/94A Contributions upon various development across the Council area through the required Contributions Plans. As part of these Plans, Council has received funds for which it will be required to expend the monies in accordance with those Plans. As well, these Plans indicate proposed future expenditure to be undertaken by Council, which will be funded by making levies and receipting funds in future years or where a shortfall exists by the use of Council's General Funds. These future expenses do not yet qualify as liabilities as of the reporting date, but represent Councils intention to spend funds in the manner and timing set out in those Plans.

Council has classified a number of privately owned land parcels as Local Open Space or Bushland. As a result, where notified in writing by the various owners, Council will be required to purchase these land parcels. At reporting date, reliable estimates as to the value of any potential liability (& subsequent land asset) from such potential acquisitions has not been possible.

ASSETS NOT RECOGNISED: (i) Land Under Roads As permitted under AASB 1051, Council has elected not to bring to account Land Under Roads that it owned or controlled up to & including 30/6/08. (ii) Infringement Notices/Fines Fines & Penalty Income, the result of Council issuing Infringement Notices is followed up and collected by the Infringement Processing Bureau. Councils Revenue Recognition policy for such income is to account for it as revenue on receipt. Accordingly, at year end, there is a potential asset due to Council representing issued but unpaid Infringement Notices. Due to the limited information available on the status, value and duration of outstanding Notices, Council is unable to determine the value of outstanding income.

page 70

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 19. Controlled Entities, Associated Entities & Interests in Joint Ventures $ '000

Council has no interest in any Controlled Entities, Associated Entities or Joint Ventures.

Note 20. Equity - Retained Earnings and Revaluation Reserves $ '000

Notes

Actual 2013

Actual 2012

105,301 6,475

104,480 821

111,776

105,301

(a) Retained Earnings Movements in Retained Earnings were as follows: Balance at beginning of Year (from previous years audited accounts) a. Net Operating Result for the Year

Balance at End of the Reporting Period (b) Reserves (i) Reserves are represented by: - Infrastructure, Property, Plant & Equipment Revaluation Reserve Total

282,775

226,451

282,775

226,451

(ii) Reconciliation of movements in Reserves: Infrastructure, Property, Plant & Equipment Revaluation Reserve - Opening Balance - Revaluations for the year 9(a) - Impairment of revalued assets (incl. impairment reversals) 9(a),(c) - Balance at End of Year TOTAL VALUE OF RESERVES

226,451 32,420 23,904 282,775

282,775

256,036 2,246 (31,831) 226,451

226,451

(iii) Nature & Purpose of Reserves Infrastructure, Property, Plant & Equipment Revaluation Reserve

- The Infrastructure, Property, Plant & Equipment Revaluation Reserve is used to record increments/decrements of Non Current Asset values due to their revaluation.

(c) Correction of Error/s relating to a Previous Reporting Period Council made no correction of errors during the current reporting period.

(d) Voluntary Changes in Accounting Policies Council made no voluntary changes in any accounting policies during the year. page 71

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 21. Financial Result & Financial Position by Fund Income Statement by Fund

Actual 2013

Water

Sewer

General1

1,258 3,189 64 178 28 7 4,724

2,653 360 270 128 26 72 3,509

21,106 9,809 1,945 887 36,318 2,270 72,335

1,449 573 1,195 1,008 371 -

879 249 871 955 426 -

14,899 1,803 37,341 9,354 2,421 299

Total Expenses from Continuing Operations

4,596

3,380

66,117

Operating Result from Continuing Operations

128

129

6,218

$ '000

Actual 2013

Continuing Operations Income from Continuing Operations Rates & Annual Charges User Charges & Fees Interest & Investment Revenue Other Revenues Grants & Contributions provided for Operating Purposes Grants & Contributions provided for Capital Purposes

Total Income from Continuing Operations

Expenses from Continuing Operations Employee Benefits & on-costs Borrowing Costs Materials & Contracts Depreciation & Amortisation Impairment Other Expenses Net Losses from the Disposal of Assets Share of interests in Joint Ventures & Associates using the Equity Method

Discontinued Operations Net Profit/(Loss) from Discontinued Operations

Net Operating Result for the Year

128

129

6,218

Net Operating Result attributable to each Council Fund

128

129

Net Operating Result attributable to Non-controlling Interests

6,218 -

Net Operating Result for the year before Grants and Contributions provided for Capital Purposes

121

3,948

General Fund refers to all Council's activities other than Water & Sewer. NB. All amounts disclosed above are Gross - that is, they include internal charges & recoveries made between the Funds.

page 72

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements as at 30 June 2013

Note 21. Financial Result & Financial Position by Fund (continued) Statement of Financial Position by Fund

Actual 2013

Water

Sewer

General1

1,835 1,580 116 1 3,532

4,785 708 116 5,609

15,031 1,611 6,194 845 404 24,085

45,318 45,318 48,850

27,585 27,585 33,194

336,855 145 337,000 361,085

1,118 145 185 1,448

69 125 42 236

5,301 689 5,232 11,222

TOTAL LIABILITIES

7,576 7,576 9,024

3,509 3,509 3,745

22,129 2,458 24,587 35,809

Net Assets

39,826

29,449

325,276

7,822 32,004

19,105 10,344

84,849 240,427

39,826

29,449

325,276

$ '000

ASSETS Current Assets Cash & Cash Equivalents Investments Receivables Inventories Other Non-current assets classified as 'held for sale' Total Current Assets Non-Current Assets Investments Receivables Inventories Infrastructure, Property, Plant & Equipment Investments Accounted for using the equity method Investment Property Intangible Assets Total Non-Current Assets

TOTAL ASSETS LIABILITIES Current Liabilities Payables Borrowings Provisions Total Current Liabilities Non-Current Liabilities Payables Borrowings Provisions Total Non-Current Liabilities

EQUITY Retained Earnings Revaluation Reserves

Total Equity 1

General Fund refers to all Council's activities other than Water & Sewer. NB. All amounts disclosed above are Gross - that is, they include internal receivables & payables between the Funds. page 73

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 22. "Held for Sale" Non Current Assets & Disposal Groups $ '000

Council did not classify any Non Current Assets or Disposal Groups as "Held for Sale".

Note 23. Events occurring after the Reporting Period Events that occur between the end of the reporting period (ending 30 June 2013) and the date when the financial statements are "authorised for issue" have been taken into account in preparing these statements. Council has adopted the date of receipt of the Auditors' Report as the applicable "authorised for issue" date relating to these General Purpose Financial Statements. Accordingly, the "authorised for issue" date is 30/10/13. Events that occur after the Reporting Period represent one of two types: (i) Events that provide evidence of conditions that existed at the Reporting Period These financial statements (and the figures therein) incorporate all "adjusting events" that provided evidence of conditions that existed at 30 June 2013. (ii) Events that provide evidence of conditions that arose after the Reporting Period These financial statements (& figures therein) do not incorporate any "non-adjusting events" that have occurred after 30 June 2013 and which are only indicative of conditions that arose after 30 June 2013. Council is unaware of any material or significant "non-adjusting events" that should be disclosed.

Note 24. Discontinued Operations Council has not classified any of its Operations as "Discontinued".

Note 25. Intangible Assets Intangible Assets represent identifiable non-monetary asset without physical substance. Council is unaware of any control over Intangible Assets that warrant recognition in the Financial Statements, including either internally generated and developed assets or purchased assets. page 74

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 26. Reinstatement, Rehabilitation & Restoration Liabilities $ '000

Council has legal/public obligations to make restore, rehabilitate and reinstate the following assets/operations: Estimated year of Asset/Operation

NPV of Provision

restoration

Tips Quarries

Balance at End of the Reporting Period

10(a)

2013

2012

3,315 571

1,897 414

3,886

2,311

Under AASB 116 - Property, Plant & Equipment, where the use of an asset results in the obligation to dismantle or remove the asset and restore the site on which the asset stands, an estimate of such costs is required to be included in the cost of the asset. An equivalent liability must be recognised under AASB 137 - Provisions, Contingent Liabilities and Contingent Assets. The provision has been calculated by determining the present value of the future expenditures expected to be incurred. The discount rate used is the risk free borrowing rate applicable to Council. Specific uncertainties relating to the final costs and the assumptions made in determining the amounts of provisions include:

Reconciliation of movement in Provision for year: Balance at beginning of year Amounts capitalised to new or existing assets: Increase in tip remediation cost Effect of a change in other calculation estimates used Amortisation of discount (expensed to borrowing costs) Total - Reinstatement, rehabilitation and restoration provision

2,311

1,986

500 915 160

243 82

3,886

2,311

Amount of Expected Reimbursements Of the above Provisions for reinstatement, rehabilitation and restoration works, those applicable to Garbage Services & Waste Management are able to be funded through future charges incorporated within Council's Annual Domestic Waste Management Charge.

page 75

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 27. Financial Review $ '000

Key Financial Figures of Council over the past 5 years (consolidated) 2013

2012

2011

2010

2009

25,017 13,358 2,279 31,660 80,568

23,309 11,434 946 15,031 55,400

21,517 10,655 2,063 9,351 48,490

19,616 10,444 1,502 10,769 47,102

17,896 11,125 3,717 8,909 44,634

543 1,030

1,193 -

635 6,825

451 1,000

657 5,654

Outflows: Employee Benefits & On-cost Expenses Borrowing Costs Materials & Contracts Expenses Total Expenses from Continuing Operations

17,227 2,625 39,407 74,093

15,695 2,624 21,718 54,579

14,635 2,476 14,174 46,345

14,607 2,498 13,228 43,079

13,985 2,061 14,447 44,842

Total Cash purchases of I,PP&E Total Loan Repayments (incl. Finance Leases)

16,940 876

17,700 807

16,347 680

12,517 625

15,929 772

Operating Surplus/(Deficit) (excl. Capital Income)

4,126

467

(1,789)

(526)

(4,045)

Financial Position Figures

2013

2012

2011

2010

2009

33,226 12,906 20,320

25,447 10,286 15,161

26,567 9,921 16,646

22,816 9,176 13,640

19,586 8,621 10,965

2,270

6,453

4,056

5,873

5,432

Cash & Investments - Unrestricted Cash & Investments - Internal Restrictions Cash & Investments - Total

1,131 11,490 23,262

1,283 7,217 16,358

2,800 10,347 22,901

2,779 6,907 15,697

1,214 5,830 14,336

Total Borrowings Outstanding

34,173

34,019

34,826

28,681

28,306

583,781

518,651

537,204

514,550

488,371

187,194

186,222

179,370

163,008

152,923

Financial Performance Figures Inflows: Rates & Annual Charges Revenue User Charges Revenue Interest & Investment Revenue (Losses) Grants Income - Operating & Capital Total Income from Continuing Operations Sale Proceeds from I,PP&E New Loan Borrowings & Advances

Current Assets Current Liabilities Net Current Assets Available Working Capital (Unrestricted Net Current Assets)

(Loans, Advances & Finance Leases)

Total Value of I,PP&E (excl. Land & Earthworks) Total Accumulated Depreciation Indicative Remaining Useful Life (as a % of GBV)

68%

64%

67%

68%

69%

Source: Published audited financial statements of Council (current year & prior year) page 76

Financial Statements 2013

Moree Plains Shire Council Notes to the Financial Statements for the financial year ended 30 June 2013

Note 28. Council Information & Contact Details Principal Place of Business: 21 Auburn Street Moree NSW 2400 Contact Details Mailing Address: PO Box 420 Moree NSW 2400

Opening Hours: 9am to 5pm Monday to Friday

Telephone: Facsimile:

Internet: Email:

02 6757 3222 02 6752 3934

http://www.mpsc.nsw.gov.au council@mpsc.nsw.gov.au

Officers GENERAL MANAGER D Aber

Elected Members MAYOR K Humphries

RESPONSIBLE ACCOUNTING OFFICER D Aber

COUNCILLORS R Brazel R Fernance C Gall M Montgomery S Price P Strang J Tramby T Zannes J von Drehnen T Wannan

PUBLIC OFFICER A Pippos AUDITORS Luka Group 2 River Street Dubbo NSW 2830

Other Information ABN: 46 566 790 582

page 77

page 78

page 79

page 80

page 81

page 82

page 83

page 84

page 85

page 86

Moree Plains Shire Council SPECIAL PURPOSE FINANCIAL STATEMENTS for the year ended 30 June 2013

Leading the Way to a Better Community

SPFS 2013

Moree Plains Shire Council Special Purpose Financial Statements for the financial year ended 30 June 2013

Contents 1. Statement by Councillors & Management

Page 2

2. Special Purpose Financial Statements: Income Statement - Water Supply Business Activity Income Statement - Sewerage Business Activity Income Statement - Other Business Activities

3 4 5

Statement of Financial Position - Water Supply Business Activity Statement of Financial Position - Sewerage Business Activity Statement of Financial Position - Other Business Activities

6 7 8

3. Notes to the Special Purpose Financial Statements

4. Auditor's Report

Background (i)

These Special Purpose Financial Statements have been prepared for the use by both Council and the Division of Local Government in fulfilling their requirements under National Competition Policy.

(ii)

The principle of competitive neutrality is based on the concept of a "level playing field" between persons/entities competing in a market place, particularly between private and public sector competitors. Essentially, the principle is that government businesses, whether Commonwealth, State or Local, should operate without net competitive advantages over other businesses as a result of their public ownership.

(iii)

For Council, the principle of competitive neutrality & public reporting applies only to declared business activities. These include (a) those activities classified by the Australian Bureau of Statistics as business activities being water supply, sewerage services, abattoirs, gas production and reticulation and (b) those activities with a turnover of over $2 million that Council has formally declared as a Business Activity (defined as Category 1 activities).

(iv)

In preparing these financial statements for Council's self classified Category 1 businesses and ABS defined activities, councils must (a) adopt a corporatisation model and (b) apply full cost attribution including tax equivalent regime payments & debt guarantee fees (where the business benefits from councils borrowing position by comparison with commercial rates).

page 1

SPFS 2013

Moree Plains Shire Council Income Statement of Council's Water Supply Business Activity for the financial year ended 30 June 2013

$ '000

Actual 2013

Actual 2012

1,258 3,185 4 64 28 178 4,717

1,413 2,178 55 45 144 3,835

1,449 573 1,195 1,008 14 371 4,610 107

1,403 589 1,108 990 14 302 4,406 (571)

7 114

(571)

114 (32)

(571) -

(571)

Expenses from continuing operations Employee benefits and on-costs Borrowing costs Materials and contracts Depreciation and impairment Water purchase charges Loss on sale of assets Calculated taxation equivalents Debt guarantee fee (if applicable) Other expenses Total expenses from continuing operations Surplus (deficit) from Continuing Operations before capital amounts

Grants and contributions provided for capital purposes Surplus (deficit) from Continuing Operations after capital amounts

Surplus (deficit) from discontinued operations Surplus (deficit) from ALL Operations before tax less: Corporate Taxation Equivalent (30%) [based on result before capital]

SURPLUS (DEFICIT) AFTER TAX plus Opening Retained Profits plus/less: Prior Period Adjustments plus Adjustments for amounts unpaid: - Taxation equivalent payments - Debt guarantee fees - Corporate taxation equivalent less: - Tax Equivalent Dividend paid - Surplus dividend paid Closing Retained Profits

7,708 -

8,279 -

14 32

14 -

(14) 7,822

(14) 7,708

Return on Capital % Subsidy from Council

1.5% 1,028

0.0% 1,348

82 (7) 75 37

(571) -

Calculation of dividend payable: Surplus (deficit) after tax less: Capital grants and contributions (excluding developer contributions) Surplus for dividend calculation purposes Potential Dividend calculated from surplus

page 3

SPFS 2013

Moree Plains Shire Council Income Statement of Council's Sewerage Business Activity for the financial year ended 30 June 2013

$ '000

Actual 2013

Actual 2012

Income from continuing operations Access charges User charges Liquid Trade Waste charges Fees Interest Grants and contributions provided for non capital purposes Profit from the sale of assets Other income Total income from continuing operations

2,653 360 270 26 128 3,437

2,673 369 6 276 66 158 3,548

879 249 871 955 13 426 3,393 44

851 258 623 1,046 13 405 3,196 352

72 116

352

Surplus (deficit) from ALL Operations before tax less: Corporate Taxation Equivalent (30%) [based on result before capital]

116 (13)

352 (106)

SURPLUS (DEFICIT) AFTER TAX

103

246

18,989 -

18,749 -

13 13

13 106

Expenses from continuing operations Employee benefits and on-costs Borrowing costs Materials and contracts Depreciation and impairment Loss on sale of assets Calculated taxation equivalents Debt guarantee fee (if applicable) Other expenses Total expenses from continuing operations Surplus (deficit) from Continuing Operations before capital amounts

Grants and contributions provided for capital purposes Surplus (deficit) from Continuing Operations after capital amounts

Surplus (deficit) from discontinued operations

plus Opening Retained Profits plus/less: Prior Period Adjustments plus Adjustments for amounts unpaid: - Taxation equivalent payments - Debt guarantee fees - Corporate taxation equivalent less: - Tax Equivalent Dividend paid - Surplus dividend paid Closing Retained Profits

(13) 19,105

(13) (112) 18,989

Return on Capital % Subsidy from Council

1.1% 747

2.2% 231

103 (72) 31 15

246 246 123 page 4

SPFS 2013

Moree Plains Shire Council Income Statement of Council's Other Business Activities for the financial year ended 30 June 2013

$ '000

Income from continuing operations Access charges User charges Fees Interest Grants and contributions provided for non capital purposes Profit from the sale of assets Other income Total income from continuing operations Expenses from continuing operations Employee benefits and on-costs Borrowing costs Materials and contracts Depreciation and impairment Loss on sale of assets Calculated taxation equivalents Debt guarantee fee (if applicable) Other expenses Total expenses from continuing operations Surplus (deficit) from Continuing Operations before capital amounts

Grants and contributions provided for capital purposes Surplus (deficit) from Continuing Operations after capital amounts

Surplus (deficit) from discontinued operations Surplus (deficit) from ALL Operations before tax less: Corporate Taxation Equivalent (30%) [based on result before capital]

SURPLUS (DEFICIT) AFTER TAX plus Opening Retained Profits plus/less: Prior Period Adjustments plus Adjustments for amounts unpaid: - Taxation equivalent payments - Debt guarantee fees - Corporate taxation equivalent add: - Subsidy Paid/Contribution To Operations less: - TER dividend paid - Dividend paid Closing Retained Profits Return on Capital % Subsidy from Council

GWYDIR DAY CARE

MAX CENTRE

Category 2

Actual 2013

Actual 2012

Actual 2013

Actual 2012

564 276 840

718 55 773

342 342

329 329

613 10 135 758 82

583 11 89 683 90

196 393 589 (247)

200 259 459 (130)

(247)

633 503

82 (25)

90 (27)

(247) -

503 -

(247)

503

244 -

154 -

563 -

60 -

326

244

316

563

19.2% -

21.3% -

-0.7% 309

1.0% 137

page 5

SPFS 2013

Moree Plains Shire Council Statement of Financial Position - Council's Water Supply Business Activity as at 30 June 2013

$ '000

Actual 2013

Actual 2012

ASSETS Current Assets Cash and cash equivalents Investments Receivables Inventories Other Non-current assets classified as held for sale Total Current Assets

1,835 1,580 116 1 3,532

1,870 1,499 145 1 3,515

45,318 45,318 48,850

45,074 45,074 48,589

LIABILITIES Current Liabilities Bank Overdraft Payables Borrowings Provisions Total Current Liabilities

1,118 145 185 1,448

1,925 137 144 2,206

Non-Current Liabilities Payables Borrowings Provisions Total non-Current Liabilities TOTAL LIABILITIES

7,576 7,576 9,024

7,721 3 7,724 9,930

39,826

38,659

7,822 32,004 39,826 -

7,708 30,951 38,659 -

39,826

38,659

NET ASSETS EQUITY Retained earnings Revaluation reserves Council equity interest Non-controlling interest

TOTAL EQUITY

page 6

SPFS 2013

Moree Plains Shire Council Statement of Financial Position - Council's Sewerage Business Activity as at 30 June 2013

$ '000

Actual 2013

Actual 2012

ASSETS Current Assets Cash and cash equivalents Investments Receivables Inventories Other Non-current assets classified as held for sale Total Current Assets

4,785 708 116 5,609

3,935 828 145 4,908

27,585 27,585 33,194

27,772 27,772 32,680

69 125 42 236

120 118 104 342

3,509 3,509 3,745

3,634 1 3,635 3,977

29,449

28,703

19,105 10,344 29,449 -

18,989 9,714 28,703 -

29,449

28,703

Non-Current Assets Investments Receivables Inventories Infrastructure, property, plant and equipment Investments accounted for using equity method Investment property Other Total non-Current Assets TOTAL ASSETS LIABILITIES Current Liabilities Bank Overdraft Payables Borrowings Provisions Total Current Liabilities Non-Current Liabilities Payables Borrowings Provisions Total non-Current Liabilities TOTAL LIABILITIES

NET ASSETS EQUITY Retained earnings Revaluation reserves Council equity interest Non-controlling equity interest

TOTAL EQUITY

page 7

SPFS 2013

Moree Plains Shire Council Statement of Financial Position - Council's Other Business Activities as at 30 June 2013 GWYDIR DAY CARE

MAX CENTRE

Category 2

Actual 2013

Actual 2012

Actual 2013

Actual 2012

ASSETS Current Assets Cash and cash equivalents Investments Receivables Inventories Other Non-current assets classified as held for sale Total Current Assets

216 216

148 1 149

23 23

1 1

478 478 694

474 474 623

6,849 6,849 6,872

6,845 6,845 6,846

LIABILITIES Current Liabilities Bank Overdraft Payables Borrowings Provisions Total Current Liabilities

1 8 167 176

1 7 169 177

3,078 42 3,120

2,763 41 2,804

Non-Current Liabilities Payables Borrowings Provisions Other Liabilities Total non-Current Liabilities TOTAL LIABILITIES

146 146 322

154 3 157 334

2,691 2,691 5,811

2,733 2,733 5,537

372

289

1,061

1,309

326 46 372 -

244 45 289 -

316 745 1,061 -

563 746 1,309 -

372

289

1,061

1,309

$ '000

NET ASSETS EQUITY Retained earnings Revaluation reserves Council equity interest Non-controlling equity interest

TOTAL EQUITY

page 8

SPFS 2013

Moree Plains Shire Council Special Purpose Financial Statements for the financial year ended 30 June 2013

Contents of the Notes accompanying the Financial Statements Note

Details

Page

Summary of Significant Accounting Policies

Water Supply Business Best Practice Management disclosure requirements

Sewerage Business Best Practice Management disclosure requirements

page 9

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 1. Significant Accounting Policies These financial statements are a Special Purpose Financial Statements (SPFS) prepared for use by Council and the Division of Local Government. For the purposes of these statements, the Council is not a reporting not-for-profit entity. The figures presented in these special purpose financial statements, unless otherwise stated, have been prepared in accordance with: 

the recognition and measurement criteria of relevant Australian Accounting Standards,

 other authoritative pronouncements of the Australian Accounting Standards Board (AASB) &  Australian Accounting Interpretations. The disclosures in these special purpose financial statements have been prepared in accordance with:  the Local Government Act and Regulation, and  the Local Government Code of Accounting Practice and Financial Reporting. The statements are also prepared on an accruals basis, based on historic costs and do not take into account changing money values nor current values of non-current assets (except where specifically stated). Certain taxes and other costs (appropriately described) have been imputed for the purposes of the National Competition Policy.

The pricing & costing guidelines outline the process for identifying and allocating costs to activities and provide a standard of disclosure requirements. These disclosures are reflected in Council’s pricing and/or financial reporting systems and include taxation equivalents; council subsidies; return on investments (rate of return); and dividends paid.

Declared Business Activities In accordance with Pricing & Costing for Council Businesses - A Guide to Competitive Neutrality, Council has declared that the following are to be considered as business activities: Category 1 (where gross operating turnover is over $2 million)

a. Moree Water Supplies Comprising the net assets & operations of the water supply systems servicing the towns of Moree, Mungindi, Boggabilla, Pallamallawa and surrounding villages of Moree Plains Shire, each of which is established as a separate Special Rate Fund. b. Moree Sewerage Service Comprising the net assets & operations of the sewerage reticulation and treatment system servicing the towns of Moree, Mungindi, and surrounding villages of Moree Plains Shire, which is established as a separate Special Rate Fund.

Category 2 National Competition Policy Council has adopted the principle of ‘competitive neutrality’ to its business activities as part of the national competition policy which is being applied throughout Australia at all levels of government. The framework for its application is set out in the June 1996 Government Policy statement on the “Application of National Competition Policy to Local Government”. The “Pricing & Costing for Council Businesses A Guide to Competitive Neutrality” issued by the Division of Local Government in July 1997 has also been adopted.

(where gross operating turnover is less than $2 million)

a. Gwydir Day Care Centre Comprising the net assets & operations of Gwydir Day Care which provides low cost day care services to the town of Moree. b. Max Centre Comprising the net assets & operations of the Max Centre which is a large commercial building containing retail outlets, service providers and restaurants that provides rental income to the Council.

page 10

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 1. Significant Accounting Policies Monetary Amounts Amounts shown in the financial statements are in Australian currency and rounded to the nearest one thousand dollars, with the exception of some figures disclosed in Note 2 (Water Supply Best Practice Management Disclosures) and Note 3 (Sewerage Best Practice Management Disclosures). As required by the NSW Office of Water (Department of Primary Industries) the amounts shown in Notes 2 and Note 3 are disclosed in whole dollars.

The payment of taxation equivalent charges, referred in the Best Practice Management of Water Supply and Sewerage Guides to as a “Dividend for Taxation equivalent”, may be applied for any purpose allowed under the Local Government Act, 1993. Achievement of substantial compliance against the guidelines for Best Practice Management of Water Supply and Sewerage is not a prerequisite for the payment of the tax equivalent charges, however the payment must not exceed $3 per assessment.

Income Tax

(i) Taxation Equivalent Charges Council is liable to pay various taxes and financial duties in undertaking its business activities. Where this is the case, they are disclosed in these statements as a cost of operations just like all other costs. However, where Council is exempt from paying taxes which are generally paid by private sector businesses (such as income tax), equivalent tax payments have been applied to all Council nominated business activities and are reflected in these financial statements. For the purposes of disclosing comparative information relevant to the private sector equivalent, the following taxation equivalents have been applied to all council nominated business activities (this does not include council’s non-business activities): Notional Rate Applied % Corporate Income Tax Rate – 30% Land Tax – The first $406,000 of combined land values attracts 0%. From $406,001 to $2,482,000 the rate is 1.6% + $100. For the remaining combined land value that exceeds $2,482,000, a premium marginal rate of 2.0% applies. Payroll Tax – 5.45% on the value of taxable salaries and wages in excess of $689,000. In accordance with the guidelines for Best Practice Management of Water Supply and Sewerage, a payment for the amount calculated as the annual tax equivalent charges (excluding income tax) must be paid from Water Supply and Sewerage Business activities.

An income tax equivalent has been applied on the profits of each reported Business Activity. Whilst income tax is not a specific cost for the purpose of pricing a good or service, it needs to be taken into account of in terms of assessing the rate of return required on capital invested. Accordingly, the return on capital invested is set at a pre-tax level (gain/(loss) from ordinary activities before capital amounts) as would be applied by a private sector competitor – that is, it should include a provision equivalent to the corporate income tax rate, currently 30%. Income Tax is only applied where a positive gain/(loss) from ordinary activities before capital amounts has been achieved. Since this taxation equivalent is notional - that is, it is payable to the “Council” as the owner of business operations, it represents an internal payment and has no effect on the operations of the council. Accordingly, there is no need for disclosure of internal charges in Council's General Purpose Financial Statements. The rate applied of 30% is the equivalent company tax rate prevalent as at reporting date.

Local Government Rates & Charges A calculation of the equivalent rates and charges payable on all Category 1 businesses has been applied to all land assets owned or exclusively used by the Business Activity.

page 11

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 1. Significant Accounting Policies Loan & Debt Guarantee Fees The debt guarantee fee is designed to ensure that council business activities face “true” commercial borrowing costs in line with private sector competitors. In order to calculate a debt guarantee fee, council has determined what the differential borrowing rate would have been between the commercial rate and the council’s borrowing rate for its business activities.

As a minimum, business activities should generate a return equal to the Commonwealth 10 year bond rate which is 3.77% at 30/6/13. The actual rate of return achieved by each Business Activity is disclosed at the foot of each respective Income Statement.

(iv) Dividends

(ii) Subsidies

Council is not required to pay dividends to either itself (as owner of a range of businesses) or to any external entities.

Government policy requires that subsidies provided to customers and the funding of those subsidies must be explicitly disclosed.

Local Government Water Supply and Sewerage Businesses are permitted to pay an annual dividend from its water supply or sewerage business surplus.

Subsidies occur where council provides services on a less than cost recovery basis. This option is exercised on a range of services in order for council to meet its community service obligations.

The dividend, calculated and approved in accordance with the Best Practice Management Guidelines, must not exceed either: (i)

Accordingly, Subsidies disclosed (in relation to National Competition Policy) represents the difference between revenue generated from ‘rate of return’ pricing and revenue generated from prices set by the council in any given financial year. The overall effect of subsidies is contained within the Income Statement of each reported Business Activity.

(iii) Return on Investments (Rate of Return) The Policy statement requires that councils with Category 1 businesses “would be expected to generate a return on capital funds employed that is comparable to rates of return for private businesses operating in a similar field”.

50% of this surplus in any one year, or

(ii) the number of water supply or sewerage assessments at 30 June 2013 multiplied by $30 (less the payment for tax equivalent charges, not exceeding $3 per assessment).

In accordance with the guidelines for Best Practice Management of Water Supply and Sewerage, a Dividend Payment form, Statement of Compliance, Unqualified Independent Financial Audit Report and Compliance Audit Report are required to be submitted to the NSW Office of Water prior to making the dividend and only after it has approved the payment.

Such funds are subsequently available for meeting commitments or financing future investment strategies. The Rate of Return on Capital is calculated as follows: Operating Result before Capital Income + Interest Expense Written Down Value of I,PP&E as at 30 June page 12

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 2. Water Supply Business Best Practice Management disclosure requirements 2013

Dollars Amounts shown below are in WHOLE DOLLARS (unless otherwise indicated)

1. Calculation and Payment of Tax-Equivalents [All Local Government Local Water Utilities must pay this dividend for tax-equivalents]

(i)

Calculated Tax Equivalents

14,000

(ii)

No of assessments multiplied by $3/assessment

13,959

(iii)

Amounts payable for Tax Equivalents [lesser of (i) and (ii)]

13,959

(iv)

Amounts actually paid for Tax Equivalents

14,000

2. Dividend from Surplus (i) 50% of Surplus before Dividends

37,450

[Calculated in accordance with Best Practice Management for Water Supply and Sewerage Guidelines]

(ii)

No. of assessments multiplied by $30/assessment, less tax equivalent charges/assessment

(iii)

Cumulative surplus before Dividends for the 3 years to 30 June 2013, less the cumulative dividends paid for the 2 years to 30 June 2012 & 30 June 2011 2013 Surplus

74,900

(571,000) -

2012 Surplus 2012 Dividend

2011 Surplus 2011 Dividend

125,631

(1,017,100)

(521,000) -

(iv)

Maximum dividend from surplus [least of (i), (ii) and (iii) above]

(v)

Dividend actually paid from surplus [refer below for required pre-dividend payment Criteria]

n/a -

3. Required outcomes for 6 Criteria [To be eligible for the payment of a "Dividend from Surplus", ALL the Criteria below need a "YES"]

(i) (ii)

Completion of Strategic Business Plan (including Financial Plan)

YES

Full Cost Recovery, without significant cross subsidies

YES

[Refer Item 2(a) in Table 1 on page 22 of the Best Practice Guidelines]

- Complying charges [Item 2(b) in Table 1]

YES

- DSP with Commercial Developer Charges [Item 2(e) in Table 1]

YES

- If Dual Water Supplies, Complying Charges [Item 2(g) in Table 1]

YES

(iii)

Sound Water Conservation and Demand Management implemented

YES

(iv)

Sound Drought Management implemented

YES

(v)

Complete Performance Reporting Form

YES

(vi)

a. Integrated Water Cycle Management Evaluation

YES

b. Complete and implement Integrated Water Cycle Management Strategy

YES

(by 15 September each year)

page 13

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 2. Water Supply Business Best Practice Management disclosure requirements (continued) 2013

Dollars Amounts shown below are in WHOLE DOLLARS (unless otherwise indicated)

National Water Initiative (NWI) Financial Performance Indicators NWI F1

Total Revenue (Water)

$'000

4,653

Total Income (w13) - Grants for the Acquisition of Assets (w11a) - Interest Income (w9) - Aboriginal Communities W&S Program Income (w10a)

NWI F4

Revenue from Residential Usage Charges (Water)

71.35%

Income from Residential Usage Charges (w6b) x 100 divided by the sum of [Income from Residential Usage Charges (w6a) + Income from Residential Access Charges (w6b)]

NWI F9

Written Down Replacement Cost of Fixed Assets (Water)

$'000

44,211

$'000

2,983

$'000

209

Written down current cost of system assets (w47)

NWI F11

Operating Cost (OMA) (Water) Management Expenses (w1) + Operational & Maintenance Expenses (w2)

NWI F14

Capital Expenditure (Water) Acquisition of fixed assets (w16)

NWI F17

Economic Real Rate of Return (Water)

1.46%

[Total Income (w13) - Interest Income (w9) - Grants for acquisition of assets (w11a) Operating Costs (NWI F11) - Current Cost Depreciation (w3)] x 100 divided by [Written Down Current Cost of System Assets (w47) + Plant & Equipment (w33b)]

NWI F26

Capital Works Grants (Water)

$'000

Grants for the Acquisition of Assets (w11a)

Notes:

References to w (eg. w12) refer to item numbers within Special Schedules No. 3 & 4 of Council's Annual Financial Statements.

The NWI Performance Indicators are based upon the National Performance Framework Handbook for Urban Performance Reporting Indicators & Definitions. page 14

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 3. Sewerage Business Best Practice Management disclosure requirements 2013

Dollars Amounts shown below are in WHOLE DOLLARS (unless otherwise indicated)

1. Calculation and Payment of Tax-Equivalents [All Local Government Local Water Utilities must pay this dividend for tax-equivalents]

(i)

Calculated Tax Equivalents

13,000

(ii)

No of assessments multiplied by $3/assessment

12,615

(iii)

Amounts payable for Tax Equivalents [lesser of (i) and (ii)]

12,615

(iv)

Amounts actually paid for Tax Equivalents

13,000

2. Dividend from Surplus (i)

15,400

50% of Surplus before Dividends [Calculated in accordance with Best Practice Management for Water Supply and Sewerage Guidelines]

(ii)

No. of assessments x ($30 less tax equivalent charges per assessment)

113,535

(iii)

Cumulative surplus before dividends for the 3 years to 30 June 2013, less the cumulative dividends paid for the 2 years to 30 June 2012 & 30 June 2011

494,200

2013 Surplus

30,800

2012 Surplus 2012 Dividend

246,400 112,000

2011 Surplus 2011 Dividend

522,000 193,000

(iv)

Maximum dividend from surplus [least of (i), (ii) and (iii) above]

(v)

Dividend actually paid from surplus [refer below for required pre-dividend payment Criteria]

15,400

3. Required outcomes for 4 Criteria [To be eligible for the payment of a "Dividend from Surplus", ALL the Criteria below need a "YES"]

(i) (ii)

Completion of Strategic Business Plan (including Financial Plan)

YES

Pricing with full cost-recovery, without significant cross subsidies

YES

[Refer Item 2(a) in Table 1 on page 22 of the Best Practice Guidelines]

Complying charges

(a)

Residential [Item 2(c) in Table 1]

YES

(b)

Non Residential [Item 2(c) in Table 1]

YES

(c)

Trade Waste [Item 2(d) in Table 1]

YES

DSP with Commercial Developer Charges [Item 2(e) in Table 1]

YES

Liquid Trade Waste Approvals & Policy [Item 2(f) in Table 1]

YES

(iii)

Complete Performance Reporting Form

YES

(iv)

a. Integrated Water Cycle Management Evaluation

YES

b. Complete and implement Integrated Water Cycle Management Strategy

YES

(by 15 September each year)

page 15

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 3. Sewerage Business Best Practice Management disclosure requirements (continued) 2013

Dollars Amounts shown below are in WHOLE DOLLARS (unless otherwise indicated)

National Water Initiative (NWI) Financial Performance Indicators NWI F2

Total Revenue (Sewerage)

$'000

3,239

$'000

26,128

$'000

2,189

$'000

195

Total Income (s14) - Grants for Acquisition of Assets (s12a) - Interest Income (s10) - Aboriginal Communities W&S Program Income (w10a)

NWI F10

Written Down Replacement Cost of Fixed Assets (Sewerage) Written down current cost of system assets (s48)

NWI F12

Operating Cost (Sewerage) Management Expenses (s1) + Operational & Maintenance Expenses (s2)

NWI F15

Capital Expenditure (Sewerage) Acquisition of Fixed Assets (s17)

NWI F18

Economic Real Rate of Return (Sewerage)

0.34%

[Total Income (s14) - Interest Income (s10) - Grants for acquisition of Assets (s12a) - Operating cost (NWI F12) - Current cost depreciation (s3)] x 100 divided by [Written down current cost (ie. WDCC) of System Assets (s48) + Plant & Equipment (s34b)]

NWI F27

Capital Works Grants (Sewerage)

$'000

7,892

Grants for the Acquisition of Assets (12a)

National Water Initiative (NWI) Financial Performance Indicators Water & Sewer (combined) NWI F3

Total Income (Water & Sewerage) Total Income (w13 + s14) + Gain/Loss on disposal of assets (w14 + s15) minus Grants for acquisition of assets (w11a + s12a) - Interest Income (w9 + s10)

NWI F8

Revenue from Community Service Obligations (Water & Sewerage)

0.58%

Community Service Obligations (NWI F25) x 100 divided by Total Income (NWI F3)

NWI F16

Capital Expenditure (Water & Sewerage)

$'000

404

Acquisition of Fixed Assets (w16 + s17)

NWI F19

Economic Real Rate of Return (Water & Sewerage)

1.04%

[Total Income (w13 + s14) - Interest Income (w9 + s10) - Grants for acquisition of assets (w11a + s12a) - Operating Cost (NWI F11 + NWI F12) - Current cost depreciation (w3 + s3)] x 100 divided by [Written down replacement cost of fixed assets (NWI F9 + NWI F10) + Plant & equipment (w33b + s34b)]

NWI F20

Dividend (Water & Sewerage)

$'000

Dividend paid from surplus (2(v) of Note 2 + 2(v) of Note 3)

NWI F21

Dividend Payout Ratio (Water & Sewerage)

0.00%

Dividend (NWI F20) x 100 divided by Net Profit after tax (NWI F24)

page 16

SPFS 2013

Moree Plains Shire Council Notes to the Special Purpose Financial Statements for the financial year ended 30 June 2013

Note 3. Sewerage Business Best Practice Management disclosure requirements (continued) 2013

Dollars Amounts shown below are in WHOLE DOLLARS (unless otherwise indicated)

National Water Initiative (NWI) Financial Performance Indicators Water & Sewer (combined) NWI F22

Net Debt to Equity (Water & Sewerage)

6.84%

Overdraft (w36 + s37) + Borrowings (w38 + s39) - Cash & Investments (w30 + s31) x 100 divided by [Total Assets (w35 + s36) - Total Liabilities (w40 + s41)]

NWI F23

Interest Cover (Water & Sewerage) Earnings before Interest & Tax (EBIT) divided by Net Interest Earnings before Interest & Tax (EBIT):

711

Operating Result (w15a + s16a) + Interest expense (w4a + s4a) - Interest Income (w9 + s10) - Gain/Loss on disposal of assets (w14 + s15) + Miscellaneous Expenses (w4b + w4c + s4b + s4c) Net Interest:

488

Interest Expense (w4a + s4a) - Interest Income (w9 + s10)

NWI F24

Net Profit After Tax (Water & Sewerage)

$'000

196

$'000

Surplus before dividends (w15a + s16a) - Tax equivalents paid (Note 2-1(iv) + Note 3-1(iv))

NWI F25

Community Service Obligations (Water & Sewerage) Grants for Pensioner Rebates (w11b + s12b)

Notes:

References to w (eg. s12) refer to item numbers within Special Schedules No. 5 & 6 of Council's Annual Financial Statements.

The NWI Performance Indicators are based upon the National Performance Framework Handbook for Urban Performance Reporting Indicators & Definitions. page 17

page 18

page 19

Moree Plains Shire Council SPECIAL SCHEDULES for the year ended 30 June 2013

Leading the Way to a Better Community

Special Schedules 2013

Moree Plains Shire Council Special Schedules for the financial year ended 30 June 2013

Contents

Page

Special Schedules1 - Special Schedule No. 1

Net Cost of Services

- Special Schedule No. 2(a) - Special Schedule No. 2(b)

Statement of Long Term Debt (all purposes) Statement of Internal Loans (Sect. 410(3) LGA 1993)

- Special Schedule No. 3 - Special Schedule No. 4

Water Supply - Income Statement Water Supply - Statement of Financial Position

5 9

- Special Schedule No. 5 - Special Schedule No. 6

Sewerage Service - Income Statement Sewerage Service - Statement of Financial Position

10 14

2 4 n/a

- Notes to Special Schedules No. 3 & 5 - Special Schedule No. 7

Condition of Public Works

- Special Schedule No. 8

Financial Projections

Special Purpose Schedules are not audited.

Background (i)

These Special Schedules have been designed to meet the requirements of special purpose users such as;     

(ii)

the NSW Grants Commission the Australian Bureau of Statistics (ABS), the NSW Office of Water, the Department of Environment, Climate Change and Water, and the Division of Local Government (DLG).

The financial data is collected for various uses including;     

the allocation of Financial Assistance Grants, the incorporation of Local Government financial figures in national statistics, the monitoring of loan approvals, the allocation of borrowing rights, and the monitoring of the financial activities of specific services.

page 1

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 1 - Net Cost of Services for the financial year ended 30 June 2013

$'000 Function or Activity

Expenses from. Continuing. Operations.

Income from continuing operations Non Capital.

Net Cost. of Services. Capital.

725

(724)

Administration

3,494

712

(2,782)

Public Order and Safety Fire Service Levy, Fire Protection, Emergency Services Beach Control Enforcement of Local Govt. Regulations Animal Control Other Total Public Order & Safety

766 468 235 51 1,520

331 468 31 830

(435) (204) (51) (690)

364

(359)

Environment Noxious Plants and Insect/Vermin Control Other Environmental Protection Solid Waste Management Street Cleaning Drainage Stormwater Management Total Environment

324 249 3,706 139 4,418

180 44 3,038 3,262

(144) (205) (668) (139) (1,156)

Community Services and Education Administration & Education Social Protection (Welfare) Aged Persons and Disabled Children's Services Total Community Services & Education

658 74 22 770 1,524

108 36 1 841 986

(550) (38) (21) 71 (538)

Total Housing and Community Amenities

284 73 504 248 848 1,957

138 61 327 526

50 50

(146) (73) (393) 79 (848) (1,381)

Water Supplies

4,595

4,202

(386)

Sewerage Services

3,116

3,369

325

Governance

Health

Housing and Community Amenities Public Cemeteries Public Conveniences Street Lighting Town Planning Other Community Amenities

page 2

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 1 - Net Cost of Services (continued) for the financial year ended 30 June 2013

$'000 Expenses from. Continuing. Operations.

Function or Activity

Recreation and Culture Public Libraries Museums Art Galleries Community Centres and Halls Performing Arts Venues Other Performing Arts Other Cultural Services Sporting Grounds and Venues Swimming Pools Parks & Gardens (Lakes) Other Sport and Recreation Total Recreation and Culture

Income from continuing operations Non Capital.

Net Cost. of Services. Capital.

(678) (183) (251) (6) (30) (562) (1,257) (1,354) (151) (4,472)

715 183 267 6 37 562 2,231 1,380 151 5,532

28 16 7 974 26 1,051

9 9

Fuel & Energy

Agriculture

(161) 466 305

3,739 3 27,209 4,089 2,846 37 140 333 7,143 45,539

13 23,985 4,724 142 528 5,912 35,304

1,072 711 400 28 2,211

(2,654) (3) (2,513) 1,035 (2,704) (37) (112) 195 (1,231) (8,024)

15 1,599 1,614

760 760

(15) (839) (854)

74,093

51,008

2,349

(20,736)

Mining, Manufacturing and Construction

Building Control Other Mining, Manufacturing & Construction Total Mining, Manufacturing and Const. Transport and Communication Urban Roads (UR) - Local Urban Roads - Regional Sealed Rural Roads (SRR) - Local Sealed Rural Roads (SRR) - Regional Unsealed Rural Roads (URR) - Local Unsealed Rural Roads (URR) - Regional Bridges on UR - Local Bridges on SRR - Local Bridges on URR - Local Bridges on Regional Roads Parking Areas Footpaths Aerodromes Other Transport & Communication Total Transport and Communication Economic Affairs Camping Areas & Caravan Parks Other Economic Affairs Total Economic Affairs

Totals â&#x20AC;&#x201C; Functions General Purpose Revenues

161 (466) (305)

(2)

Share of interests - joint ventures & associates using the equity method

NET OPERATING RESULT (1) (1) As reported in the Income Statement

27,211

74,093

78,219

2,349

6,475

(2) Includes: Rates & Annual Charges (incl. Ex Gratia, excl. Water & Sewer), Non Capital General Purpose Grants, Interest on Investments (excl. Ext. Restricted Assets) & Interest on overdue Rates & Annual Charges

page 3

Moree Plains Shire Council Special Schedule No. 2(a) - Statement of Long Term Debt (all purpose) for the financial year ended 30 June 2013

$'000 Principal outstanding at beginning of the year

Other Long Term Debt Ratepayers Advances Government Advances Finance Leases Deferred Payments Total Long Term Debt

Sinking Funds

Transfers Interest to Sinking applicable for Year Funds

Non Current

873 873

33,146 33,146

34,019 34,019

1,030 1,030

876 876

873

33,146

34,019

1,030

876

Total

page 4

Notes: Excludes (i) Internal Loans & (ii) Principal Inflows/Outflows relating to Loan Re-Financing. This Schedule is prepared using the face value of debt obligations, rather than fair value (which are reported in the GPFS).

at the end of the year Current

Non Current

2,465 2,465

959 959

33,214 33,214

34,173 34,173

2,465

959

33,214

34,173

Total

Special Schedules 2013

Total Debt

From Revenue

Principal outstanding

Debt redemption during the year

Current Classification of Debt Loans (by Source) Commonwealth Government Treasury Corporation Other State Government Public Subscription Financial Institutions Other Total Loans

New Loans raised during the year

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 3 - Water Supply Income Statement Includes ALL INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. for the financial year ended 30 June 2013

$'000

Actuals 2013

Actuals 2012

Expenses and Income Expenses

Management expenses a. Administration b. Engineering and Supervision

971 95

1,210 107

Operation and Maintenance expenses - Dams & Weirs a. Operation expenses b. Maintenance expenses

281 236

244 76

- Mains c. Operation expenses d. Maintenance expenses

615

554

- Reservoirs e. Operation expenses f. Maintenance expenses

11 45 27

8 25 10

316 46 147 178

279 37 127 111

21 33 -

24 15 -

Depreciation expenses a. System assets b. Plant and equipment

995 13

973 16

Miscellaneous expenses a. Interest expenses b. Revaluation Decrements c. Other expenses d. Impairment - System assets e. Impairment - Plant and equipment f. Aboriginal Communities Water & Sewerage Program g. Tax Equivalents Dividends (actually paid)

573 -

589 -

4,610

4,406

- Pumping Stations g. Operation expenses (excluding energy costs) h. Energy costs i. Maintenance expenses - Treatment j. Operation expenses (excluding chemical costs) J. Energy costs k. Chemical costs l. Maintenance expenses - Other m. Operation expenses n. Maintenance expenses o. Purchase of water 3.

Total expenses

page 5

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 3 - Water Supply Income Statement (continued) Includes ALL INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. for the financial year ended 30 June 2013 Actuals 2013

Actuals 2012

Residential charges a. Access (including rates) b. Usage charges

956 2,381

987 1,837

Non-residential charges a. Access (including rates) b. Usage charges

303 870

707 101

115 -

93 -

7 24 -

24 10

4 -

21 -

4,724

3,835

$'000

Income 6.

Extra charges

Interest income

10. Other income 10a. Aboriginal Communities Water and Sewerage Program 11. Grants a. Grants for acquisition of assets b. Grants for pensioner rebates c. Other grants 12. Contributions a. Developer charges b. Developer provided assets c. Other contributions 13. Total income 14. Gain (or loss) on disposal of assets 15. Operating Result

114

(571)

15a. Operating Result (less grants for acquisition of assets)

107

(571)

page 6

Special Schedules 2013

Actuals 2012

16. Acquisition of Fixed Assets a. New Assets for Improved Standards b. New Assets for Growth c. Renewals d. Plant and equipment

198 11 -

62 749 -

17. Repayment of debt a. Loans b. Advances c. Finance leases

137 -

127 -

346

938

44 -

463 -

463

3,914 151 553 35

3,921 63 554 28

$'000

Capital transactions Non-operating expenditures

18. Transfer to sinking fund 19. Totals

Non-operating funds employed 20. Proceeds from disposal of assets 21. Borrowing utilised a. Loans b. Advances c. Finance leases 22. Transfer from sinking fund 23. Totals

Rates and charges

24. Number of assessments a. Residential (occupied) b. Residential (unoccupied, ie. vacant lot) c. Non-residential (occupied) d. Non-residential (unoccupied, ie. vacant lot)

25. Number of ETs for which developer charges were received 26. Total amount of pensioner rebates (actual dollars)

44,850

13 $

43,855

page 7

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 3 - Water Supply Cross Subsidies for the financial year ended 30 June 2013

$'000

Yes

Amount

Best practice annual charges and developer charges*

27. Annual charges a. Does Council have best-practice water supply annual charges and usage charges*?

Yes

If Yes, go to 28a. If No, please report if council has removed land value from access charges (ie rates)? NB. Such

charges for both residential customers and non-residential customers comply with section 3.2 of Water Supply, Sewerage and Trade Waste Pricing Guidelines, NSW Office of Water, December, 2002. Such charges do not involve significant cross subsidies.

b. Cross-subsidy from residential customers using less than allowance (page 25 of Guidelines) c. Cross-subsidy to non-residential customers (page 24 of Guidelines) d. Cross-subsidy to large connections in unmetered supplies (page 26 of Guidelines) 28. Developer charges a. Has council completed a water supply Development Servicing** Plan?

Yes

b. Total cross-subsidy in water supply developer charges for 2012/13 (page 47 of Guidelines) ** In accordance with page 9 of Developer Charges Guidelines for Water Supply, Sewerage and Stormwater, NSW Office of Water, December, 2002. 29. Disclosure of cross-subsidies Total of cross-subsidies (27b +27c + 27d + 28b)

* Councils which have not yet implemented best practice water supply pricing should disclose cross-subsidies in items 27b, 27c and 27d above. However, disclosure of cross-subsidies is not required where a Council has implemented best practice pricing and is phasing in such pricing over a period of 3 years. page 8

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 4 - Water Supply Statement of Financial Position Includes INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. as at 30 June 2013 Actuals Current

Actuals Non Current

Actuals Total

ASSETS 30. Cash and investments a. Developer charges b. Special purpose grants c. Accrued leave d. Unexpended loans e. Sinking fund f. Other

141 1,694 -

31. Receivables a. Specific purpose grants b. Rates and Availability Charges c. User Charges d. Other

149 1,378 53

116

33. Property, plant and equipment a. System assets b. Plant and equipment

44,211 1,107

34. Other assets

35. Total assets

3,532

45,318

48,850

1,118

145 -

7,576 -

7,721 -

185

40. Total liabilities

1,448

7,576

9,024

41. NET ASSETS COMMITTED

2,084

37,742

39,826

$'000

32. Inventories

LIABILITIES 36. Bank overdraft 37. Creditors 38. Borrowings a. Loans b. Advances c. Finance leases 39. Provisions a. Tax equivalents b. Dividend c. Other

EQUITY 42. Accumulated surplus 43 Asset revaluation reserve

7,822 32,004

44. TOTAL EQUITY

39,826

45. 46. 47.

Note to system assets: Current replacement cost of system assets Accumulated current cost depreciation of system assets Written down current cost of system assets

72,506 (28,295) 44,211 page 9

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 5 - Sewerage Service Income Statement Includes ALL INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. for the financial year ended 30 June 2013

$'000

Actuals 2013

Actuals 2012

Expenses and Income Expenses

Management expenses a. Administration b. Engineering and Supervision

441 66

450 9

Operation and Maintenance expenses - Mains a. Operation expenses b. Maintenance expenses

1 293

254

- Pumping Stations c. Operation expenses (excluding energy costs) d. Energy costs e. Maintenance expenses

106 92 190

86 99 121

- Treatment f. Operation expenses (excl. chemical, energy, effluent & biosolids management costs) g. Chemical costs h. Energy costs i. Effluent Management j. Biosolids Management k. Maintenance expenses

75 239 1 15 220

37 269 14 9 186

- Other l. Operation expenses m. Maintenance expenses

450 -

358 -

Depreciation expenses a. System assets b. Plant and equipment

931 24

1,005 41

249 -

258 -

3,393

3,196

Total expenses

page 10

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 5 - Sewerage Income Statement (continued) Includes ALL INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. for the financial year ended 30 June 2013

$'000

Actuals 2013

Actuals 2012

2,132

2,147

Income 6.

Residential charges (including rates)

Non-residential charges a. Access (including rates) b. Usage charges

520 357

526 366

Trade Waste Charges a. Annual Fees b. Usage charges c. Excess mass charges d. Re-inspection fees

131 -

167 -

270

236

12. Grants a. Grants for acquisition of assets b. Grants for pensioner rebates c. Other grants

22 -

21 -

13. Contributions a. Developer charges b. Developer provided assets c. Other contributions

77 -

41 4

3,509

3,548

16. Operating Result

116

352

16a. Operating Result (less grants for acquisition of assets)

116

352

Extra charges

10. Interest income 11. Other income 11a. Aboriginal Communities Water & Sewerage Program

14. Total income 15. Gain (or loss) on disposal of assets

page 11

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 5 - Sewerage Income Statement (continued) Includes ALL INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. for the financial year ended 30 June 2013 Actuals 2013

Actuals 2012

17. Acquisition of Fixed Assets a. New Assets for Improved Standards b. New Assets for Growth c. Renewals d. Plant and equipment

118 77 -

34 231 -

18. Repayment of debt a. Loans b. Advances c. Finance leases

118 -

110 -

313

375

21. Proceeds from disposal of assets

22. Borrowing utilised a. Loans b. Advances c. Finance leases

23. Transfer from sinking fund

24. Totals

3,487 140 540 38

3,517 52 546 39

$'000

Capital transactions Non-operating expenditures

19. Transfer to sinking fund 20. Totals Non-operating funds employed

Rates and charges

25. Number of assessments a. Residential (occupied) b. Residential (unoccupied, ie. vacant lot) c. Non-residential (occupied) d. Non-residential (unoccupied, ie. vacant lot)

26. Number of ETs for which developer charges were received 27. Total amount of pensioner rebates (actual dollars)

40,519

17 $

39,349

page 12

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 5 - Sewerage Cross Subsidies for the financial year ended 30 June 2013

$'000

Yes

Amount

Best practice annual charges and developer charges*

28. Annual charges a. Does Council have best-practice sewerage annual charges, usage charges and trade waste fees & charges*?

Yes

If Yes, go to 29a. If No, please report if council has removed land value from access charges (ie rates)? NB. Such

charges for both residential customers and non-residential customers comply with section 4.2 & 4.3 of the Water Supply, Sewerage and Trade Waste Pricing Guidelines, NSW Office of Water, December, 2002. Such charges do not involve significant cross subsidies.

b. Cross-subsidy to non-residential customers (page 45 of Guidelines) c. Cross-subsidy to trade waste discharges (page 46 of Guidelines) 29. Developer charges a. Has council completed a sewerage Development Servicing** Plan?

Yes

b. Total cross-subsidy in sewerage developer charges for 2012/13 (page 47 of Guidelines) ** In accordance with page 9 of Developer Charges Guidelines for Water Supply, Sewerage and Stormwater, NSW Office of Water, December, 2002. 30. Disclosure of cross-subsidies Total of cross-subsidies (28b + 28c + 29b)

* Councils which have not yet implemented best practice sewer pricing & liquid waste prising should disclose cross-subsidies in items 28b and 28c above. However, disclosure of cross-subsidies is not required where a Council has implemented best practice sewerage and liquid waste pricing and is phasing in such pricing over a period of 3 years. page 13

Special Schedules 2013

Moree Plains Shire Council Special Schedule No. 6 - Sewerage Service Statement of Financial Position Includes INTERNAL TRANSACTIONS, ie. prepared on a Gross Basis. as at 30 June 2013 Actuals Current

Actuals Non Current

Actuals Total

212 147 4,426

32. Receivables a. Specific purpose grants b. Rates and Availability Charges c. User Charges d. Other

480 227 1

33. Inventories

116

34. Property, plant and equipment a. System assets b. Plant and equipment

26,128 1,457

35. Other assets

36. Total Assets

5,609

27,585

33,194

$'000

ASSETS 31. Cash and investments a. Developer charges b. Special purpose grants c. Accrued leave d. Unexpended loans e. Sinking fund f. Other

LIABILITIES 37. Bank overdraft 38. Creditors 39. Borrowings a. Loans b. Advances c. Finance leases

125 -

3,509 -

3,634 -

40. Provisions a. Tax equivalents b. Dividend c. Other

236

3,509

3,745

5,373

24,076

29,449

41. Total Liabilities 42. NET ASSETS COMMITTED EQUITY 42. Accumulated surplus 44. Asset revaluation reserve

19,103 10,346

45. TOTAL EQUITY

29,449

46. 47. 48.

Note to system assets: Current replacement cost of system assets Accumulated current cost depreciation of system assets Written down current cost of system assets

51,958 (25,830) 26,128 page 14

Special Schedules 2013

Moree Plains Shire Council Notes to Special Schedule No.'s 3 & 5 for the financial year ended 30 June 2013

Administration

(1)

Engineering and supervision

(1)

(item 1a of Special Schedules 3 and 5) comprises the following:

(item 1b of Special Schedules 3 and 5) comprises the following:

•

Administration staff: − Salaries and allowance − Travelling expenses − Accrual of leave entitlements − Employment overheads.

•

Engineering staff: − Salaries and allowance − Travelling expenses − Accrual of leave entitlements − Employment overheads.

•

Meter reading.

•

Bad and doubtful debts.

•

Other administrative/corporate support services.

Other technical and supervision staff: − Salaries and allowance − Travelling expenses − Accrual of leave entitlements − Employment overheads.

Operational expenses (item 2 of Special Schedules 3 and 5) comprise the day to day operational expenses excluding maintenance expenses. Maintenance expenses (item 2 of Special Schedules 3 and 5) comprise the day to day repair and maintenance expenses. (Refer to Section 5 of the Local Government Asset Accounting Manual regarding capitalisation principles and the distinction between capital and maintenance expenditure). Other expenses (item 4c of Special Schedules 3 and 5) includes all expenses not recorded elsewhere. Revaluation decrements (item 4b of Special Schedules 3 and 5) is to be used when I,PP&E decreases in FV. Impairment Losses (item 4d & 4e of Special Schedules 3 and 5) are to be used when the carrying amount of an asset exceeds its recoverable amount (refer to page D-31). Aboriginal Communities Water and Sewerage Program (item 4f of Special Schedules 3 and 5) is to be used when operation and maintenance work has been undertaken on behalf of the Aboriginal Communities Water and Sewerage Program. Similarly, income for item 11a of Special Schedule 3 and item 12a of Special Schedule 5 are for services provided to the Aboriginal Communities Water and Sewerage Program and is not part of Council’s water supply and sewerage revenue. Residential charges (2) (items 6a, 6b and item 6 of Special Schedules 3 and 5 respectively) include all income from residential charges. Item 6 of Schedule 3 should be separated into 6a Access Charges (including rates if applicable) and 6b Usage Charges. Non-residential charges (2) (items 7a, 7b of Special Schedules 3 and 5) include all income from non-residential charges separated into 7a Access Charges (including rates if applicable) and 7b Usage Charges. Trade waste charges (item 8 of Special Schedule 5) include all income from trade waste charges separated into 8a Annual Fees, 8b Usage Charges and 8c Excess Mass Charges and 8d Re-inspection Fees. Other income (items 10 and 11 of Special Schedules 3 and 5 respectively) include all income not recorded elsewhere. Other contributions (items 12c and 13c of Special Schedules 3 and 5 respectively) incl. capital contributions for water supply or sewerage services received by Council under Section 565 of the Local Government Act. Notes: Administration and engineering costs for the development of capital works projects should be reported as part of the capital cost of the project and not as part of the recurrent expenditure (ie. in item 16 for water supply and item 17 for sewerage, and not in items 1a and 1b).

(1)

(2)

To enable accurate reporting of residential revenue from usage charges, it is essential for councils to accurately separate their residential (item 6) charges and non-residential (item 7) charges. page 15

Moree Plains Shire Council Special Schedule No. 7 - Condition of Public Works as at 30 June 2013

$'000 Dep'n. Rate (%)

Dep'n Expense ($) Cost

ASSET CLASS

Asset Category

Buildings

Council Offices Council Houses Library Childcare Centre(s) Art Gallery Other sub total

per Note 1

Other Structures Assets not included in Buildings sub total Public Roads

Sealed Roads Unsealed Roads Bridges Footpaths Kerb and Gutter sub total

1.06% 1.08% 0.85% 1.14% 1.08% 1.19%

1.76%

3.26% 0.53% 0.85% 1.23% 1.57%

per Note 4

122 10 26 14 30 339 541 852 852 4,544 564 255 76 271 5,710

Accum. Depreciation Amortisation & Valuation Impairment

Carrying Amount Asset #. (WDV) Condition

Estimated cost to bring up to a satisfactory

Required(2) Annual

Current(3) Annual

condition / Maintenance Maintenance standard (1)

<<<<<<<<<<<< per Note 9 >>>>>>>>>>>>

1,826 258 724 221 594 8,595 12,218

12,036 936 2,846 1,198 3,097 37,623 57,736

1 2 1 2 2 2

13,862 1,194 3,570 1,419 3,691 46,218 69,954

139 12 36 14 37 457 695

127 11 11 15 15 354 533

1,890 1,890

12,007 12,007

13,897 13,897

278 278

338 338

52,471 26,243 6,558 3,116 6,188 94,576

86,362 79,549 23,472 5,063 10,652 205,098

2 3 2 4 3

138,833 105,792 30,030 8,179 16,840 299,674

6,574 12,546 150 2,194 890 22,354

11,247 13,608 255 137 205 25,452

12,000 2,332 125 254 174 14,885 Special Schedules 2013

page 16

Moree Plains Shire Council Special Schedule No. 7 - Condition of Public Works

(continued)

as at 30 June 2013

$'000 Dep'n. Rate (%)

Dep'n Expense ($) Cost

ASSET CLASS

Asset Category

Water

Dams & Bores Reservoirs Mains Treatment Works sub total

2.14%

Pump Stations Mains Treatment Works sub total

2.04%

per Note 1

Sewerage

1.05% 1.28% 3.09%

1.66% 2.01%

per Note 4

143 374 300 178 995 144 522 265 931

Accum. Depreciation Amortisation & Valuation Impairment

Carrying Amount Asset (WDV) Condition#.

Estimated cost to bring up to a satisfactory

Required(2) Annual

Current(3) Annual

condition / Maintenance Maintenance standard (1)

<<<<<<<<<<<< per Note 9 >>>>>>>>>>>>

2,962 11,925 10,988 2,421 28,296

3,734 23,644 12,534 3,338 43,250

3 4 3 3

6,696 35,569 23,522 5,759 71,546

251 356 856 173 1,636

101 1,293 516 99 2,009

3,552 16,270 6,009 25,831

3,525 15,048 7,204 25,777

4 3 2

7,077 31,318 13,213 51,608

212 879 396 1,487

459 1,291 158 1,908

Special Schedules 2013

page 17

Moree Plains Shire Council Special Schedule No. 7 - Condition of Public Works

(continued)

as at 30 June 2013

$'000 Dep'n. Rate (%)

Dep'n Expense ($) Cost

ASSET CLASS

Asset Category per Note 1

Drainage Works Drainage sub total

1.00%

TOTAL - ALL ASSETS

per Note 4

205 205 9,234

Accum. Depreciation Amortisation & Valuation Impairment

Carrying Amount Asset (WDV) Condition#.

Estimated cost to bring up to a satisfactory

Required(2) Annual

Current(3) Annual

condition / Maintenance Maintenance standard (1)

<<<<<<<<<<<< per Note 9 >>>>>>>>>>>>

20,583 20,583

7,334 7,334

13,249 13,249

527,262

170,145

357,117

885 885

411 411

164 164

23,239

29,959

19,837

Notes: (1). (2). (3).

Satisfactory refers to estimated cost to bring the asset to a satisfactory condition as deemed by Council. It does not include any planned enhancements to the existing asset. Required Annual Maintenance is what should be spent to maintain assets in a satisfactory standard. Current Annual Maintenance is what has been spent in the current year to maintain assets.

Asset Condition "Key" - as per the DLG Integrated Planning & Reporting Manual

page 18

1 2 3

Excellent - No work required (normal maintenance) Good - Only minor maintenance work required Average - Maintenance work required

4 5

Poor - Renewal required Very Poor - Urgent renewal/upgrading required

Special Schedules 2013

Additional Notes: (1). Assets with a condition assessment of 1 (Excellent), 2 (Good) and 3 (Average) are assumed to be satisfactory. Where individual assets within a category have been assessed as condition 4 (Poor) or 5 (Very Poor) the estimated cost to bring those assets to condition 1 (Excellent) has been calculated. (2). Where available, the assets lifecycle cost (as per Councils Strategic Asset Management Plan) has been used to determine the required annual maintenance cost. Therefore capital expenditure has been included in the current annual maintenance figures for comparative purposes. (3). The Sealed and Unsealed Roads categories include Local and Regional Roads. The shortfall between Current and Required Annual Maintenance for sealed roads primarily relates to Regional Roads only. (4). For the asset category Unsealed Roads, figures have been calculated based on the current gravel/black soil split (gravel - 1,503km's, black soil - 490km's) as determined in the 2009/10 revaluation of Council roads. For the gravel component, gravel resheeting has been included in the estimated cost to bring asset to a satisfactory standard, required annual maintenance and current annual maintenance figures. (5). Water and Sewer infrastructure is operated on a run-to-fail basis, therefore it is assumed these assets are satisfactory while continuing to operate. (6). The Sealed and Unsealed Roads categories exclude any impairment of assets due to flood damage. This equates to approximately $10.80M.

Moree Plains Shire Council Special Schedule No. 8 - Financial Projections as at 30 June 2013 Actual(1) Forecast(3) Forecast(3) Forecast(3) Forecast(3) Forecast(3) Forecast(3) Forecast(3) Forecast(3) Forecast(3) Forecast(3)

$'000 (i) OPERATING BUDGET Income from continuing operations Expenses from continuing operations Operating Result from Continuing Operations

(ii) CAPITAL BUDGET New Capital Works (2) Replacement/Refurbishment of Existing Assets Total Capital Budget

Funded by: – Loans – Asset sales – Reserves – Grants/Contributions – Recurrent revenue – Other

12/13

13/14

14/15

15/16

16/17

17/18

18/19

19/20

20/21

21/22

22/23

80,568 74,093

58,872 58,856

48,077 48,181

49,668 49,294

51,281 50,508

52,944 51,793

54,659 52,931

56,427 54,322

58,283 55,757

60,179 57,241

62,128 58,807

6,475

374

773

1,151

1,728

2,105

2,526

2,938

3,321

4,686 10,857 15,543

16,008 14,949 30,957

3,518 9,338 12,856

1,580 10,264 11,844

1,280 10,239 11,519

1,368 10,084 11,452

1,250 10,080 11,330

1,250 12,700 13,950

1,050 12,494 13,544

1,050 11,063 12,113

1,050 13,369 14,419

504 543 4,972 2,349 7,175 15,543

19,535 780 2,012 2,916 5,624 90 30,957

2,045 629 788 2,109 7,285 12,856

1,003 1,118 2,508 7,215 11,844

707 828 2,436 7,548 11,519

1,030 1,136 2,018 7,268 11,452

1,204 860 1,801 7,465 11,330

846 3,080 2,231 7,793 13,950

804 1,625 2,038 9,077 13,544

825 950 2,038 8,300 12,113

845 940 2,038 10,596 14,419

(104)

Special Schedules 2013

page 19

Notes: (1) From 12/13 Income Statement. (2) New Capital Works are major non-recurrent projects, eg new Leisure Centre, new Library, new Swimming pool etc. (3) Financial projections should be in accordance with Council’s Integrated Planning and Reporting framework.