Financial and Assets Ratios

Unrestricted Cash Expense Cover Ratio

Purpose: An indicator of the unconstrained liquidity available to a council to meet ongoing and emergent financial demands, which is a key component to solvency. It represents the number of months a council can continue operating based on current monthly expenses.

Formula: (Total Cash and Equivalents add Current Investments add Available Ongoing QTC Working Capital Facility less Externally Restricted Cash) / (Total Operating Expenditure less Depreciation and Amortisation Expense less Finance Costs) * 12

Key Details: Target > 3 months. Available ongoing QTC working capital facility limits are included in the calculation, but facilities with an expiry date are not.