Town of Gawler Audit Meeting Agenda · 2017-09-05 · Town of Gawler Audit Meeting Agenda 5 October 2016 . ATTACHMENTS UNDER SEPARATE COVER. Item . 7.1 – 2016 Risk Management Review

Town of Gawler Audit Meeting Agenda

5 October 2016

ATTACHMENTS UNDER SEPARATE COVER

Item 7.1 – 2016 Risk Management Review

ATTACHMENT 1 2016 Local Government Association (LGA) Mutual LiabilityScheme – Risk Profile – Review Data Report

ATTACHMENT 2 2016/2017 Risk Management Action Plan

Item 7.2 – 2015/2016 Annual Financial Statements

ATTACHMENT 1 Draft 2015/2016 Annual Financial Statements

Item 7.3 – 2015/2016 Financial Performance Summary

ATTACHMENT 1 2015/2016 Financial Performance Summary

ATTACHMENT 2 2015/2016 Non Financial Indicators

Item 7.4 – Council Comparative Data Report (as at 30 June 2015)

ATTACHMENT 1 Council Comparative Data (as at 30 June 2015)

ATTACHMENT 2 SA Local Government Sector Financial Indicators Report2016

Page 1 of 202

Item 7.5 – 2015/2016 Audit Committee Workplan Update and Draft 2016/2017 Audit Committee Workplan

ATTACHMENT 1 2015/2016 Completed Audit Committee Workplan

ATTACHMENT 2 Draft 2016/2017 Audit Committee Workplan

Item 7.7 – EBA Productivity Review (ASU & AWU) – 2015/2016

ATTACHMENT 1 EPA Productivity Review – 2015/2016

Item 7.8 – Audit Committee 2015/2016 Annual Report

ATTACHMENT 1 Draft Audit Committee 2015/2016 Annual Report

Item 9.1 – Dean Newbery & Partners – External Audit Management Report – May 2016 Attendance

ATTACHMENT 1 External Audit Management Report & Response – May2016 Attendance

ATTACHMENT 2 2015/2016 Balance Date External Audit Attendance &Requirements

TOWN OF GAWLER AUDIT COMMITTEE MEETING 5 OCTOBER 2016

Page 2 of 202 ATTACHMENTS UNDER SEPARATE COVER

Item 7.1 – 2016 Risk Management Review

ATTACHMENT 1 2016 Local Government Association (LGA) Mutual LiabilityScheme – Risk Profile – Review Data Report

ATTACHMENT 2 2016/2017 Risk Management Action Plan



1

2016 LGA MUTUAL LIABILITY SCHEME

TOWN OF GAWLER

RISK PROFILE – REVIEW DATA REPORT

FRIDAY, 29 JULY 2016



ATTACHMENT 1

2

LOCAL GOVERNMENT ASSOCIATION MUTUAL LIABILITY SCHEME The establishment of the LGAMLS in 1989 provided Local Government in South Australia with an efficient means of managing risk exposures via effective (sector based) risk management programmes. Through the LGAMLS, Councils in South Australia have been afforded unlimited civil liability cover, access to experienced civil liability claims management, liability risk management services and legal advice.

Local Government in South Australia operates in an established risk management culture. The framework for developing this risk based culture is via participation in industry based initiatives (established by the LGA), such as the LGA Workers’ Compensation Scheme, the LGA Mutual Liability Scheme and the LGA Asset Mutual Fund. All of Council participation in these funds allows for the evolving risk profile of local government to be continually assessed, measured and monitored.

Pursuant to Schedule 1, Pt. 1, 2 Local Government Indemnity Schemes, of the Local Government Act 1999, “...the LGA will conduct and manage the Local Government Association Mutual Liability Scheme.” The purpose of these funds is simply to transfer the risk (including financial) that attaches to a Council undertaking its statutory powers, functions and duties.

Every Council in South Australia has a statutory duty to “insure” against the financial impact of potential civil liability risks. S142 of the Local Government Act 1999 sets out:

S142—Duty to insure against liability

(1) A Council must take out and maintain insurance to cover its civil liabilities at least to the extent prescribed by the regulations.

(2) A regulation cannot be made for the purposes of this section except after consultation with the LGA.

(3) Membership of the Local Government Association Mutual Liability Scheme constitutes insurance for the purposes of this section.

In seeking indemnity from the LGAMLS to manage a potential civil liability claim, a Council is bound by the Rules relating to Claims and Risk Management.

The purpose of the LGAMLS is -

To provide Members with a specialised claims management facility, which at the same time allows the Member to have input in the direction of the claim;

Design and deliver tailored risk management advice which is created through the identification and analysis of pooled claims and risk data

Provide Industry tailored civil liability protection that is unique while at the same time remains cost effective

Monitor and manage Local Government’s risk profile thereby providing Councils the ability to control the financial success of the fund and to avoid the effect from external influences.



3

AUDIT COMMITTEE An Audit Committee provides an important independent role between a Council, its management and between a Council and its community. One of the primary roles of these Committees is to provide suggestions and recommendations to Councils and/or management, about actions to be taken to enhance financial governance, considered to be in the best interests of local communities.

An Audit Committee plays a critical role in the financial reporting framework of a Council, by overseeing and monitoring the participation of management and external auditors in the financial reporting process. An Audit Committee also addresses issues such as the approach being adopted by Councils and management to address business risks, corporate and financial governance responsibilities and legal compliance. Councils will also refer issues of a strategic nature to their Audit Committees.

S126 of the Local government Act 1999 require a Council to have an Audit committee. The role of an Audit Committee is an essential step in a Council’s approach to achieving best practice risk management governance and financial sustainability.

In particular, the Audit Committee shall:

Keep under review the effectiveness of the Council’s internal controls and risk management systems; and

review and recommend the approval, where appropriate, of any material to be included in the annual report concerning internal controls and risk management.

It is therefore important that the Audit Committee understands the business risk profile of the Council to appreciate the risks it manages on a daily basis, and to ensure that there are appropriate management plans to manage and mitigate those risks. This will include details of Scheme Membership and insurance matters, financial reporting, legal and regulatory compliance, business continuity, and statutory compliance.

This can be facilitated by discussions and presentations by Executive management on how business risks are identified, managed, measured and monitored. The LGAMLS Review process provides essential information and data to assist with this process.

2016 AUDIT COMMITTEE / EXECUTIVE REPORTS

Explained further in this report is the new scoring methodology that the Review has undertaken this year. Audit Committees and/or Executive Leadership Teams (ELT) will need to recognise the different approach taken to scoring as it won’t compare to previous years. This new method will provide more accurate method of assessing a Council’s, and ultimately the sector’s, maturing risk profile.

These changes have made a significant effect on most Councils total score outcomes. If Councils score has decreased considerably; this is not reflective of a downturn in Risk Management functions; as it must be understood that the scores cannot be compared to previous years. A score and bonus history can be found in this report which illustrates how the new scoring methodology has not significantly decreased bonuses as the bonus methodology has changed to reflect the new process.

The details in this Data Report are based on your completed Risk Profile – Review 2016 completed with your LGAMLS representative.



4

CLAIMS

The LGAMLS provides a comprehensive Claims Management service for civil liability claims made against a Council by a third party for property loss, personal injury and/or financial loss. The Claims Management service encourages Councils to have input into the management and outcome of the claim.

Part 12 of the Scheme Rules set out Claim Procedure and include:

12.1 Notice: includes notice of any circumstance or occurrence which is likely to give rise to a claim

12.2 Not Admit Liability: A Member shall not admit liability for, compromise, settle or make/promise payment in respect of a claim subject of indemnity

12.5 Continued Support: During the course of a claim, the Member shall provide whatever information and support (including technical and professional support) a is requested to enable the resolution of the claim

A claim for indemnity is subject to the standard excess of $3,750 – unless agreed otherwise. The Claims Management service extends to include advice and support from the Risk Management Department by way of reactive risk management services and will be, from time to time, complemented by legal advice (in-house and external Legal Panel) use of external Investigators (Loss Adjustors), Assessors and other sector specialists for the purpose of collecting and compiling relevant details and information necessary for an effective and efficient claim outcome.

An independent Legal Panel including access to In-house legal support, is established by a selective tender process every 3 years, to provide relevant sector based legal advice and support for the day to day management of claims, to manage litigation and other legal proceedings and to provide legal support to Councils to (risk) manage their business risks and liabilities to avoid civil liability claims.

As part of annual Client Servicing programme, the LGAMLS Claims Team will provide claim statistics, information and analysis reports to assist in the financial management of each Member’s individual claim portfolio in conjunction with the annual Risk Profile Review process. A claims profile is also available to all Members on the LGRS Members Centre. The LGAMLS are happy to review the LGRS Members Centre and provide an overview of its use.



5

RISK MANAGEMENT AWARDS HISTORY

MUTUAL LIABILITY SCHEME

MLS 2010 2011 2012 2013 2014 2015

Major RM Award

$20,000 Light Regional Tea Tree Gully Mid Murray Gawler Onkaparinga Charles Sturt

Minor RM Award

$10,000 Adelaide Alexandrina Campbelltown Kangaroo Island Mount Gambier Yorke Peninsula

WORKERS COMPENSATION SCHEME

WCS 2010 2011 2012 2013 2014 2015

Major Metro Award

$15,000 Charles Sturt Centennial Park

Cemetery Authority Salisbury Charles Sturt West Torrens City of Mitcham

Major Regional Award

$15,000 Mount Gambier Kingston Coorong Berri Barmera Yorke Peninsula Wattle Range

Major Return to Work Award

$15,000 n/a n/a n/a n/a n/a Campbelltown



6

A NEW LOOK - 2016 The annual Risk Profile - Review (“Review”) is completed by your Risk Officer and your LGAMLS representative. The Review is designed to monitor Council’s risk profile and measure ongoing business improvement, as well as providing a gauge to compare other Councils within the Region and sector. The Review for 2016 was represented in the following 10 functions:

Governance/Finance/People

1. Reputation & Integrity

2. Strategic Risk & Governance

3. Procurement, Contract Management Systems

4. Volunteers/Vulnerable Groups/Committees

5. People

Operations/Services/Functions

6. Environment/Vegetation/Trees

7. Emergency Management

8. Community Land Recreation/Leisure Services

9. Road & Footpath Management

10. Use by other parties - facilities/land

In recognising the increasing statutory obligations for Local Government to show good governance via the application of risk management, the method by which a Council is assessed or scored has been refined to better reflect the successful application of your Risk Policy and accompanying framework.

In 2016 we have altered the method by which we calculate the score against different categories. This will provide a more accurate method of assessing a Council’s, and ultimately the sector’s, maturing risk profile. In accordance with the revised method of assessment, the categories are more aligned to a Council’s Strategic Plan and Goals. The revised Review in 2016 aims to recognise all functions of Council’s business, as any function / operation of a Council can attract a level of civil liability risk / opportunity. The business profile when measured against Council’s Strategic Plan allows the Council and or the Audit committee to consider and apply the level of risk tolerance (or “appetite”) a Council is prepared to accept (opportunity) or identify areas that require a more focussed risk management approach to prevent/mitigate potential civil liability claims (risks).

These changes will have a significant effect on the scoring process and therefore cannot be compared to previous years. These changes in methodology need to be understood so there is no false perception that Councils Risk Management has taken a serious downturn. We understand that the Review score is reported to the Council / Audit committee / ELT, so it must be understood that the change in scoring methodology cannot be likened to previous years.

With the new scoring methodology in 2016, Council should consider 50% as the overall benchmark figure that has been assessed against in all categories. This figure, with Councils claims performance over a 7 year window, will provide the overall profile and bonus allocation. This scoring system will allow Councils to view their improvements compared to the results in the Review and claims data. It should be noted that the Review process is dynamic, and questions/actions are reviewed and updated each year to reflect the evolving nature of risk management and the maturing of a growing Council.



7

TOWN OF GAWLER

CONTRIBUTION/ BONUS HISTORY

2011/12 2012/13 2013/14 2014/15 2015/16

Contribution gross $95,864 $100,082 $102,884 $105,147 $107,566

Bonus $15,450 $19,668 $20,218 $20,663 $21,139

Contribution net $80,414 $80,414 $82,666 $84,484 $86,427

Spec Distribution (MLS) $16,245 $12,175 $12,186 $12,186 $23,271

Total (inc discount) $64,169 $68,239 $70,480 $72,298 $63,156

*2015/16 Special Distribution yet to be distributed to CEOs

RISK PROFILE REVIEW SCORE HISTORY

2010 2011 2012 2013 2014 2015

Town of Gawler 79.6% 70.8% 73.2% 57.0% 57.0% 97.2%

Metro Average 94.2% 92.5% 92.6% 93.0% 93.0% N/A

Regional Average 83.5% 80.5% 81.4% 80.8% 80.8% N/A

LG Average 86.2% 83.5% 84.2% 83.9% 83.9% N/A

*not all Councils were scored in 2015 due to the change in methodology in 2016



8

2016/17 MEMBERSHIP YEAR

REVISED LGAMLS PERFORMANCE BONUS SYSTEM

A Performance Bonus System for Contributions has been in place since 1990. Following an appraisal of this system the criteria base for assessing the allocation of bonuses was amended to include a Risk Management component in 2003/04. As a result we are now able to prove a fairer, more complete Performance Bonus System comprising of two clear elements, one relating to Claims Experience and the other to Risk Management.

The bonus process provides an opportunity for a Council to be recognised as a good participating member of the LGAMLS. The bonus is recognised as a discount on the next year’s membership contribution (i.e. a Council will pay a net contribution as opposed to a gross contribution).

As the Risk Culture of Councils matures and evolves the bonus structure will continue to be reviewed to provide a fair and equitable return. The focus on the Risk Management structures and methods that councils are implementing has resulted in a shifting of the bonus weighting in favour of the Risk Management Component of the Review. This weighting reduces the impact of the Council Loss Ratio on the amount of bonus they receive, effective Risk Management performance will by its nature result in a reduction in avoidable loss.

The Claims Loss Ratio for each Council over a 7 year window (date reported to the LGAMLS) will continue to be calculated. Claim costs incurred over the window period will be divided by the Contributions paid by the Council during that window.



9

2016 RISK PROFILE – REVIEW

Section Town of Gawler Metro Average Regional Average LG Average

Reputation & Integrity 5.5 7.0 5.0 5.4

Strategic Risk & Governance 5.0 7.1 4.9 5.4

Procurement, Contract Management Systems 7.0 7.9 6.6 6.9

Volunteers/ Vulnerable Groups/ Committees 7.0 8.8 6.1 6.7

People 5.0 7.0 5.0 5.4

Environment/ Vegetation/ Trees 7.0 8.1 5.5 6.1

Emergency Management 6.0 7.5 5.8 6.2

Community Land Recreation/ Leisure Services

8.0 8.1 6.2 6.7

Road & Footpath Management 6.5 7.8 6.4 6.7

Use by other parties – facilities/ land 7.0 8.3 6.5 7.0

Total 64.0 77.6 59.2 63.5



10

BENCHMARKING

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

8.0

9.0

10.0

Benchmark 5.0

Gawler - Town of

Gawler - Town of

LGA Average

Metro Average

Regional Average



11

ACTION PLANS During the Review process this year, all participants were asked about their 2016/2017 goals and initiatives so that the LGAMLS could support the sector through emerging trends and areas of interest. Previously Councils have been supplied with an Action Plan list which highlights actions and / or tasks against each question asked during the Review based against the Risk Management Principles, Framework and Processes (as per below). The Actions Plans for 2016/2017 will be discussed and addressed with each individual Council in July / August; to be tailored and structured in a way to suit individual wants and needs.

AS/NZS ISO 31000:2009 Risk Management – Principles and guidelines



Page 1 of 5

ACTION PLAN TOWN OF GAWLER RISK MANAGEMENT OBJECTIVES

Priority Objectives Responsible Person Due Date

Training to Leadership Team - Risk Management Awareness Nathan Hall/ Rob Castle Oct/Nov 2016

Review the Risk Management Policy and Framework (determine risk appetite for each department) Executive Management Team/ Nathan Hall January 2017

Review Community Plan, Corporate Plan to determine Strategic Risks of Council Executive Management Team/ Nathan Hall April 2017

Workshop with Leadership Team to develop Councils Operational Risk Register Leadership Team/ Nathan Hall May 2017

Awareness workshop to Elected Members on Risk Management (outline Councils Strategic Risk) Nathan Hall/ Rob Castle June 2017



ATTACHMENT 2

Page 2 of 5

Governance/ Finance/ People

1. Reputation and IntegrityQuestion Comments Action Required Responsible Person Due Date

1.1 Has your Council completed a Risk Assessment process, identifying Strategic Risks, in your Strategic Management Plan?

Council has endorsed:

• Community Plan – 2014-2024

• Corporate Plan 2014-2018

• Asset Management Plan

• Long Term Financial Plan

• Department Business Plans

Before Council identifies its strategic risk it will revise/develop the Risk Management Policy and Risk Management Framework and identify Council’s Risk Appetite for each department.

Training will be rolled out to identified staff for Risk Management, and when this has been completed Council will review the above plans to identify its strategic risks.

a) Review strategic management plans,(e.g. Strategic Plan, Business Plan,Long Term Financial Plan,Infrastructure and AssetManagement Plan) to ensure theyare consistent with Council’s riskmanagement policy/ framework.

b) Review Strategic Management Planobjectives – identifying risks toopportunities/ objectives

c) Review strategic management plansin line with risk managementpolicy/framework to identify:

• Risks and opportunitiesassociated with strategicpriorities

• Treatment plans

• Resource requirements

d) Develop strategic risk register

Executive Management Team/ Nathan Hall

April 2017



Page 3 of 5

Question Comments Action Required Responsible Person Due Date

1.2 As the Risk Management Framework ensures a consistent approach to Risk Management practices across Council – have your ElectedMembers beenintroduced to theFramework, if so how,and was this successful?

Awareness workshop to Elected Members on Risk Management (outline Councils Identified Strategic Risks)

a) Include awareness of Council’s riskmanagement framework on ElectedMember’s training needs analysis

b) Arrange training in risk managementprinciples and application ofCouncil’s risk managementframework

c) Incorporate risk management intostrategic decision making process,(e.g. inclusion of risk managementconsiderations in all reports toCouncil)

Nathan Hall/ Rob Castle June 2017



Page 4 of 5

2. Strategic Risk and GovernanceQuestion Comments Action Required Responsible Person Due Date

2.1 How would you rate the value of your Risk Management Framework in underpinning Council’s operations?

Is the framework successfully utilised across all functions and activities of Council?.

Nathan Hall & Rob Castle to conduct Risk Management Awareness Training to Leadership Team.

a) Identify Council employees whorequire an understanding of the RiskManagement Framework and includeon training needs analysis

b) Arrange training in risk managementprinciples and application ofCouncil’s risk managementframework

Nathan Hall / Rob Castel October/November 2016

Once Training has occurred the Risk Management Policy and Framework will be reviewed, templates will also be created.

c) Develop Risk ManagementFramework, (including policy,procedure, templates &operational/strategic risk registerwhich includes risk treatment plans).Refer to LGA ‘FinancialSustainability’ Information Paper No.22: Understanding Risk Management

Executive Management Team / Nathan Hall

January 2017



http://www.lga.sa.gov.au/webdata/resources/files/22%20-%20Understanding%20Risk%20Management%202015.pdf



Page 5 of 5

5. PeopleQuestion Comments Action Required Responsible Person Due Date

5.1 What processes does your Council have in place to identify Operational Risks and how is this process incorporated into your day to day business?.

Who is responsible for this process? How have Senior Management been engaged with the Operational Risk Register?

Workshops will be conducted with Leadership Team to develop the Operational Risk Register, Sign off by department Team Leader for risk that sit outside of Councils Risk Appetite

a) Develop Operational Risk Register inconsultation with executiveleadership team and other keystakeholders

b) Implement process of monitoring andreview of Operational Risk Registerby executive leadership team

c) Define organisational responsibilityfor management/oversight ofoperational risks and communicate toall relevant business units

Leadership Team / Nathan Hall

March 2017

5.2 The Risk Management Framework is a tool that can be used throughout the Council to support the development of a risk culture.

How is the Risk Management Framework promoted to employees, volunteers and contractors?

How is implementation monitored and measured?

The Organisation Development Team will review the induction process and update developed Risk Management process

a) Review Council’s processes foremployees, volunteers andcontractors to include awareness ofCouncil’s risk managementprinciples; where applicable

Organisation Development Team

April 2017

Internal auditing will be used to monitor and review the implementation of Council risk management framework

Audits will be reported to the Executive Management Team quarterly

b) Develop and implement a process tomonitor and review theimplementation of Council’s riskmanagement framework, (e.g.measure training/awarenesssessions completed, risk treatmentplans in progress/completed, etc.)

WHS/Risk Management Officer / Leadership Team

August 2017



Item 7.2 – 2015/2016 Annual Financial Statements

ATTACHMENT 1 Draft 2015/2016 Annual Financial Statements



Town of Gawler GENERAL PURPOSE FINANCIAL STATEMENTS for the year ended 30 June 2016



ATTACHMENT 1

page 1

Town of Gawler

General Purpose Financial Statements for the year ended 30 June 2016

Contents

1. Council Certificate

2. Primary Financial Statements:

- Statement of Comprehensive Income- Statement of Financial Position- Statement of Changes in Equity- Statement of Cash Flows

3. Notes to the Financial Statements

4. Independent Auditor's Report - Financial Statements

5. Independent Auditor's Report - Internal Controls

6. Certificates of Audit Independence

- Council Certificate of Audit Independence- Audit Certificate of Audit Independence 51

Page

45

3

6

7

50

2

47

49



page 2

Town of Gawler


Certification of Financial Statements

We have been authorised by the Council to certify the financial statements in their final form.

In our opinion:

the accompanying financial statements comply with the Local Government Act 1999 , Local Government (Financial Management) Regulations 2011 and Australian Accounting Standards,

the financial statements present a true and fair view of the Council’s financial position at 30 June2016 and the results of its operations and cash flows for the financial year,

internal controls implemented by the Council provide a reasonable assurance that the Council’sfinancial records are complete, accurate and reliable and were effective throughout the financial year,

the financial statements accurately reflect the Council’s accounting and other records.

Henry Inat Karen RedmanCHIEF EXECUTIVE OFFICER MAYOR

Date:



The above statement should be read in conjunction with the accompanying Notes and Significant Accounting Policies. page 3

Town of Gawler

Statement of Comprehensive Income for the year ended 30 June 2016

$ '000

IncomeRates RevenuesStatutory ChargesUser ChargesGrants, Subsidies and ContributionsInvestment IncomeReimbursementsOther IncomeNet Gain - Equity Accounted Council Businesses

Total Income

ExpensesEmployee CostsMaterials, Contracts & Other ExpensesDepreciation, Amortisation & ImpairmentFinance CostsNet loss - Equity Accounted Council Businesses

Total Expenses

Operating Surplus / (Deficit)

Asset Disposal & Fair Value AdjustmentsAmounts Received Specifically for New or Upgraded AssetsPhysical Resources Received Free of Charge

Net Surplus / (Deficit) 1

Other Comprehensive IncomeAmounts which will not be reclassified subsequently to operating resultChanges in Revaluation Surplus - I,PP&EShare of Other Comprehensive Income - Equity Accounted Council Businesses

Total Other Comprehensive Income

Total Comprehensive Income

1 Transferred to Equity Statement

3d

3,547

701

(410) (323)

23,153

18

24,731

1,578

741

349

624

24,432

135

10,175

1,276

82 141

36,620 (27,819)

(243)

7,915

-

24,675

(24,140)

4

44,416

4,221

19

3,679 2h

9a

2015

19,502 18,564

42 65

8,849 9,409

5,461 1,199

453

122

(119)

(27,819) 36,501

53

3,323

Notes

2a

2b

2c

2g

2f

2016

3c

2e

3a

10,233 3b

2d

19

711 1,284

4,367

2,225

19

2g 111




Town of Gawler

Statement of Financial Position as at 30 June 2016

$ '000

ASSETSCurrent AssetsCash and Cash EquivalentsTrade & Other ReceivablesInventoriesTotal Current Assets

Non-Current AssetsFinancial AssetsEquity Accounted Investments in Council BusinessesInfrastructure, Property, Plant & EquipmentOther Non-Current AssetsTotal Non-Current Assets

TOTAL ASSETS

LIABILITIESCurrent LiabilitiesTrade & Other PayablesBorrowingsProvisionsTotal Current Liabilities

Non-Current LiabilitiesBorrowingsProvisionsTotal Non-Current Liabilities

TOTAL LIABILITIESNet Assets

EQUITYAccumulated SurplusAsset Revaluation ReservesOther Reserves

Total Council Equity

7,421

211,679

15,383

49,407

143 7,564

9b 2,395 159,877

211,679

6b

7a

8b

8c

Notes

4,217

3,527

5b

1,994 1,406

20

4,899

17 1,047

6,325

66

2015

6a 45

2016

2,169 2,132

187,696

151 8,652

8,803

17,098

235,819

45,272

241,084 1,915

252,917

246,592

9a

7,819

3,607

8c 2,371 1,231

8a

8b

218,342

5c

5a

224,003

227,062

6c 2,009

3,058

235,819 2,851

3,994

8,295




Town of Gawler

Statement of Changes in Equity for the year ended 30 June 2016

AssetAccumulated Revaluation Other Total

$ '000 Notes Surplus Reserve Reserves Equity

2016Balance at the end of previous reporting period 45,272 187,696 2,851 235,819

a. Net Surplus / (Deficit) for Year 3,679 - - 3,679

b. Other Comprehensive Income- Gain (Loss) on Revaluation of I,PP&E 7a - (27,819) - (27,819) Other Comprehensive Income - (27,819) - (27,819)

Total Comprehensive Income 3,679 (27,819) - (24,140)

c. Transfers between Reserves 456 (456) - Balance at the end of period 49,407 159,877 2,395 211,679

2015Balance at the end of previous reporting period 35,677 151,195 4,531 191,403

a. Net Surplus / (Deficit) for Year 7,915 - - 7,915

b. Other Comprehensive Income- Gain (Loss) on Revaluation of I,PP&E 7a - 36,620 - 36,620 - Share of OCI - Equity Accounted Council Businesses 19 - (119) - (119) Other Comprehensive Income - 36,501 - 36,501

Total Comprehensive Income 7,915 36,501 - 44,416

c. Transfers between Reserves 1,680 - (1,680) - Balance at the end of period 45,272 187,696 2,851 235,819




Town of Gawler

Statement of Cash Flows for the year ended 30 June 2016

$ '000

Cash Flows from Operating ActivitiesReceiptsOperating ReceiptsInvestment ReceiptsPaymentsOperating Payments to Suppliers and EmployeesFinance Payments

Net Cash provided by (or used in) Operating Activities

Cash Flows from Investing ActivitiesReceiptsAmounts Received Specifically for New/Upgraded AssetsSale of Replaced AssetsRepayments of Loans by Community GroupsPaymentsExpenditure on Renewal/Replacement of AssetsExpenditure on New/Upgraded Assets

Net Cash provided by (or used in) Investing Activities

Cash Flows from Financing ActivitiesReceiptsProceeds from Bonds & DepositsPaymentsRepayments of BorrowingsRepayment of Bonds & Deposits

Net Cash provided by (or used in) Financing Activities

Net Increase (Decrease) in Cash Held

plus: Cash & Cash Equivalents at beginning of period

Cash & Cash Equivalents at end of period 11 1,994 4,899

(2,206) (918)

(2,904) 393

11 4,899 4,506

(201) (525) (2,169) (1,078)

164 685

(5,594) (4,838)

(2,781) (2,370) (3,032) (3,860)

22 20

111 1,199 86 173

(645) (741)

11b 4,895 6,150

(19,018) (17,428)

74 141

Notes 2016 2015

24,484 24,177



page 7

Town of Gawler

Notes to and forming part of the Financial Statements for the year ended 30 June 2016

Contents of the Notes accompanying the Financial Statements

Details

Significant Accounting PoliciesIncomeExpensesAsset Disposal & Fair Value AdjustmentsCurrent AssetsCash & Cash EquivalentsTrade & Other ReceivablesInventoriesNon-Current AssetsFinancial AssetsEquity Accounted Investments in Council's BusinessesOther Non-Current AssetsFixed AssetsInfrastructure, Property, Plant & EquipmentValuation of Infrastructure, Property, Plant & EquipmentLiabilitiesTrade & Other PayablesBorrowingsProvisionsReservesAsset Revaluation ReserveOther ReservesAssets Subject to RestrictionsReconciliation to Statement of CashflowsFunctionsComponents of FunctionsFinancial InstrumentsCommitments for ExpenditureFinancial IndicatorsUniform Presentation of FinancesOperating LeasesSuperannuationInterests in Other EntitiesNon Current Assets Held for Sale & Discontinued OperationsContingencies & Assets/Liabilities Not Recognised in the Balance SheetEvents After the Balance Sheet Date

Additional Council Disclosures

Council Information & Contact Details

n/a - not applicable

5b 195c 19

7b 22

6b 206c

248b 248c

8a

1011

25

259b 259a

2727

16

42

40

29

37

31

12a

1514

17

1312b

1918

36

30

39

41

46

44 n/a

Page

1

Note

7a

43

18

19

24

5a

8

6a

20

2 1416

20

4445

2021

23

22



_

Town of Gawler


Note 1. Summary of Significant Accounting Policies

page 8

The principal accounting policies adopted by Council in the preparation of these consolidated financial statements are set out below.

These policies have been consistently applied to all the years presented, unless otherwise stated.

1 Basis of Preparation

1.1 Compliance with Australian Accounting Standards

This general purpose financial report has been prepared in accordance with Australian Accounting Standards as they apply to not-for-profit entities, other authoritative pronouncements of the Australian Accounting Standards Board, Interpretations and relevant South Australian legislation.

The financial report was authorised for issue by certificate under regulation 14 of the Local Government (Financial Management) Regulations 2011 dated 5 October 2016.

1.2 Historical Cost Convention

Except as stated below, these financial statements have been prepared in accordance with the historical cost convention.

1.3 Critical Accounting Estimates

The preparation of financial statements in conformity with Australian Accounting Standards requires the use of certain critical accounting estimates, and requires management to exercise its judgement in applying Council’s accounting policies.

1.4 Rounding

All amounts in the financial statements have been rounded to the nearest thousand dollars ($’000).

2 The Local Government Reporting Entity

Town of Gawler is incorporated under the South Australian Local Government Act 1999 and has its principal place of business at 89 Murray Street, Gawler SA 5118. These financial statements include the Council’s direct operations and all entities through which Council controls resources to carry on its functions. In the process of reporting on the Council as a single unit, all transactions and

balances between activity areas and controlled entities have been eliminated.

3 Income Recognition

Income is measured at the fair value of the consideration received or receivable. Income is recognised when the Council obtains control over the assets comprising the income, or when the amount due constitutes an enforceable debt, whichever first occurs.

Where grants, contributions and donations recognised as incomes during the reporting period were obtained on the condition that they be expended in a particular manner or used over a particular period, and those conditions were undischarged as at the reporting date, the amounts subject to those undischarged conditions are disclosed in these notes. Also disclosed is the amount of grants, contributions and receivables recognised as incomes in a previous reporting period which were obtained in respect of the Council's operations for the current reporting period.

In recent years the payment of untied financial assistance grants has varied from the annual allocation as shown in the table below:

Cash Payment Received

Annual Allocation Difference

2013/14 $1,291,206 $2,021,658 - $730,4522014/15 $2,829,913 $2,074,464 + $755,4492015/16 $713,785 $1,469,234 - $755,449

Because these grants are untied, the Australian Accounting Standards require that payments be recognised upon receipt. Accordingly, the operating results of these periods have been distorted compared to those that would have been reported had the grants been paid in the year to which they were allocated.

The Operating Surplus Ratio disclosed in Note 15 has also been calculated after adjusting for the distortions resulting from the differences between the actual grants received and the grants entitlements allocated.



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Town of Gawler


Note 1. Summary of Significant Accounting Policies (continued)

page 9

4 Cash, Cash Equivalents and other Financial Instruments

Cash Assets include all amounts readily convertible to cash on hand at Council’s option with an insignificant risk of changes in value with a maturity of three months or less from the date of acquisition.

Receivables for rates and annual charges are secured over the subject land, and bear interest at rates determined in accordance with the Local Government Act 1999. Other receivables are generally unsecured and do not bear interest.

All receivables are reviewed as at the reporting date and adequate allowance made for amounts the receipt of which is considered doubtful.

All financial instruments are recognised at fair value at the date of recognition. A detailed statement of the accounting policies applied to financial instruments forms part of Note 13.

5 Inventories

Inventories held in respect of business undertakings have been valued at the lower of cost and net realisable value.

6 Infrastructure, Property, Plant & Equipment

6.1 Initial Recognition

All assets are initially recognised at cost. For assets acquired at no cost or for nominal consideration, cost is determined as fair value at the date of acquisition.

All non‐current assets purchased or constructed are capitalised as the expenditure is incurred and depreciated as soon as the asset is held “ready for use”. Cost is determined as the fair value of the assets given as consideration plus costs incidental to the acquisition, including architects' fees and engineering design fees and all other costs incurred. The cost of non‐current assets constructed by the Council includes the cost of all materials used in construction, direct labour on the project and an appropriate proportion of variable and fixed overhead.

6.2 Materiality

Assets with an economic life in excess of one year are only capitalised where the cost of acquisition exceeds materiality thresholds established by Council for each type of asset. In determining (and in annually reviewing) such thresholds, regard is had to the nature of the asset and its estimated service life. Examples of capitalisation thresholds applied during the year are given below. No capitalisation threshold is applied to the acquisition of land or interests in land.

Office Furniture & Equipment $5,000 Other Plant & Equipment $5,000 Buildings - new construction/extensions $10,000 Park & Playground Furniture & Equipment $5,000 Road construction & reconstruction $10,000 Paving & footpaths, Kerb & Gutter $10,000 Drains & Culverts $10,000 Artworks $5,000

6.3 Subsequent Recognition

All material asset classes are revalued on a regular basis such that the carrying values are not materially different from fair value. Significant uncertainties exist in the estimation of fair value of a number of asset classes including land, buildings and associated structures and infrastructure. Further detail of these uncertainties, and of existing valuations, methods and valuers are provided at Note 7b.

6.4 Depreciation of Non-Current Assets

Other than land, all infrastructure, property, plant and equipment assets recognised are systematically depreciated over their useful lives on a straight‐line basis which, in the opinion of Council, best reflects the consumption of the service potential embodied in those assets.

Depreciation methods, useful lives and residual values of classes of assets are reviewed annually.

Major depreciation periods for each class of asset are listed below. Depreciation periods for infrastructure assets have been estimated based on the best information available to Council, but appropriate records covering the entire life cycle of these assets are not available, and extreme care should be used in interpreting financial information based on these estimates.



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page 10

Plant, Furniture & Equipment

Office Equipment 5 to 10 years Office Furniture 10 to 20 years Vehicles and Road-making Equip 5 to 8 years Other Plant & Equipment 5 to 15 years

Building & Other Structures

Buildings – masonry 50 to 100 years Buildings – other construction 20 to 40 years Park Structures – masonry 50 to 100 years Park Structures – other construction 20 to 40 years Playground equipment 15 to 20 years Benches, seats, etc 10 to 20 years

Infrastructure

Sealed Roads – Surface (Asphalt Seal) 25 to 40 years Sealed Roads – Structure (Spray Seal) 15 to 25 years Unsealed Roads 10 to 20 years Bridges – Concrete 80 to 100 years Paving & Footpaths, Kerb & Gutter 50 to 150 years Culverts 50 to 75 years Flood Control Structures 80 to 100 years Reticulation Pipes – PVC 70 to 100 years Reticulation Pipes – Other 25 to 100 years Pumps & Telemetry 15 to 25 years

Other Assets Artworks Indefinite Playground Equipment 15 to 20 years Swimming Pools 40 to 50 years Shade Structures 10 to 30 years Bores 20 to 40 years Court Surfaces 14 to 25 years Other Assets 7 to 100 years

Infrastructure assets estimated useful lives have been reviewed and amended where applicable upon advice received from Steve Walker of Asset Engineering, PO BOX 211, Plympton SA 5038.

6.5 Impairment

Assets that are subject to depreciation are reviewed for impairment whenever events or changes in 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 (which is the higher of the present value of future cash inflows or value in use).

For assets whose future economic benefits are not dependent on the ability to generate cash flows, and where the future economic benefits would be replaced if Council were deprived thereof, the value in use is the depreciated replacement cost. In

assessing impairment for these assets, a rebuttable assumption is made that the current replacement cost exceeds the original cost of acquisition.

Where an asset that has been revalued is subsequently impaired, the impairment is first offset against such amount as stands to the credit of that class of assets in Asset Revaluation Reserve, any excess being recognised as an expense.

7 Payables

7.1 Goods & Services

Creditors are amounts due to external parties for the supply of goods and services and are recognised as liabilities when the goods and services are received. Creditors are normally paid 30 days after the month of invoice. No interest is payable on these amounts.

7.2 Payments Received in Advance & Deposits

Amounts, other than grants received from external parties in advance of service delivery and security deposits held against possible damage to Council assets, are recognised as liabilities until the service is delivered or damage reinstated or the amount is refunded, as the case may be.

8 Borrowings

Borrowings are initially recognised at fair value, net of transaction costs incurred and are subsequently measured at amortised cost. Any difference between the proceeds (net of transaction costs) and the redemption amount is recognised in the income statement over the period of the borrowings using the effective interest method.

Borrowings are carried at their principal amounts which represent the present value of future cash flows associated with servicing the debt. Interest is accrued over the period to which it relates, and is recorded as part of “Payables”.

9 Employee Benefits

9.1 Salaries, Wages & Compensated Absences

Liabilities for employees’ entitlements to salaries, wages and compensated absences expected to be paid or settled within 12 months of reporting date are



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page 11

accrued at nominal amounts (including payroll based oncosts) measured in accordance with AASB 119.

Liabilities for employee benefits not expected to be paid or settled within 12 months are measured as the present value of the estimated future cash outflows (including payroll based oncosts) to be made in respect of services provided by employees up to the reporting date. Present values are calculated using government guaranteed securities rates with similar maturity terms.

Weighted avg. discount rate 2.34% (2015, 2.31%) Weighted avg. settlement period 5.7 years (2015, 5.4 years)

No accrual is made for sick leave as Council experience indicates that, on average, sick leave taken in each reporting period is less than the entitlement accruing in that period, and this experience is expected to recur in future reporting periods. Council does not make payment for untaken sick leave.

9.2 Superannuation

The Council makes employer superannuation contributions in respect of its employees to the Statewide Superannuation Scheme. The Scheme has two types of membership, each of which is funded differently. No changes in accounting policy have occurred during either the current or previous reporting periods. Details of the accounting policies applied and Council’s involvement with the schemes are reported in Note 18.

10 Leases

Lease arrangements have been accounted for in accordance with AASB 117.

In respect of finance leases, where Council substantially carries all of the risks incidental to ownership, the leased items are initially recognised as assets and liabilities equal in amount to the present value of the minimum lease payments. The assets are disclosed within the appropriate asset class, and are amortised to expense over the period during which the Council is expected to benefit from the use of the leased assets. Lease payments are allocated between interest expense and reduction of the lease liability, according to the interest rate implicit in the lease.

In respect of operating leases, where the lessor substantially retains all of the risks and benefits incidental to ownership of the leased items, lease payments are charged to expense over the lease term.

11 Equity Accounted Council Businesses

Council participates in cooperative arrangements with other Councils for the provision of services and facilities. Council’s interests in cooperative arrangements, which are only recognised if material, are accounted for in accordance with AASB 128 and are set out in detail in Note 19.

12 GST Implications

In accordance with UIG Abstract 1031 “Accounting for the Goods & Services Tax”

Receivables and Creditors include GSTreceivable and payable.

Except in relation to input taxed activities,revenues and operating expenditures excludeGST receivable and payable.

Non-current assets and capital expendituresinclude GST net of any recoupment.

Amounts included in the Statement of CashFlows are disclosed on a gross basis.

13 New accounting standards and UIG interpretations

In the current year, Council adopted all of the new and revised Standards and Interpretations issued by the Australian Accounting Standards Board (AASB) that are relevant to its operations and effective for the current reporting period. The adoption of the new and revised Standards and Interpretations has not resulted in any material changes to Council's accounting policies.

Town of Gawler has not applied any Australian Accounting Standards and Interpretations that have been issued but are not yet effective with the exception of AASB 2015-7 Amendments to Australian Accounting Standards – Fair Value Disclosures of Not-for-Profit Public Sector Entities. Generally Council applies standards and interpretations in accordance with their respective



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page 12

commencement dates. The retrospective application of AASB 2015-7 has exempted Council from the disclosure of quantitative information and sensitivity analysis for some valuations categorised within Level 3 of the fair value hierarchy.

At the date of authorisation of the financial report, AASB 9 Financial Instruments and AASB 2015-6 Amendments to Australian Accounting Standards – Extending Related Party Disclosures to Not-for-Profit Public Sector Entities are the only new accounting standards with a future application date that are expected to have a material impact on Council's financial statements.

From 1 July 2016 AASB 124 Related Party Disclosures will apply to Council, which means that Council will disclose more information about related parties and transactions with those related parties.

AASB 9, which replaces AASB 139 Financial Instruments: Recognition and Measurement, is effective for reporting periods beginning on or after 1 January 2018 and must be applied retrospectively. The main impact of AASB 9 is to change the requirements for the classification, measurement and disclosures associated with financial assets. Under the new requirements the four current categories of financial assets stipulated in AASB 139 will be replaced with two measurement categories: fair value and amortised cost and financial assets will only be able to be measured at amortised cost where very specific conditions are met.

As a result, Council will be required to measure its financial assets at fair value. There will be no financial impact on the consolidated financial statements.

Council is still reviewing the way that revenue is measured and recognised to identify whether AASB 15 Revenue from Contracts with Customers will have a material impact. To date no impact has been identified.

AASB 15 is effective from 1 January 2018 and will replace AASB 118 Revenue, AASB 111 Construction Contracts and a number of Interpretations. It contains a comprehensive and robust framework for the recognition, measurement and disclosure of revenue from contracts with customers.

Other amended Australian Accounting Standards and Interpretations which were issued at the date of authorisation of the financial report, but have future commencement dates are not likely to have a material impact on the financial statements.

The amended Australian Accounting Standards and Interpretations which were issued at the date of authorisation of the financial report, but have future commencement dates are not likely to have a material impact on the financial statements.

Effective for periods commencing 1 January 2016:

AASB 14 Regulatory Deferral Accounts

AASB 1057 Application of Australian AccountingStandards

AASB 2014-3 Amendments to AustralianAccounting Standards-Accounting forAcquisitions of Interests in Joint Operations

AASB 2014-4 Amendments to AustralianAccounting Standards-Clarification of AcceptableMethods of Depreciation and Amortisation

AASB 2014-6 Amendments to AustralianAccounting Standards-Agriculture: Bearer Plants

AASB 2014-9 Amendments to AustralianAccounting Standards – Equity Method inSeparate Financial Statements [AASB 1, 127 &128]

AASB 2014-10 Amendments to AustralianAccounting Standards – Sale or Contribution ofAssets between an Investor and its Associate orJoint Venture [AASB 10 & AASB 128]

AASB 2015-1 Amendments to AustralianAccounting Standards – Annual Improvements toAustralian Accounting Standards 2012–2014Cycle [AASB 1, AASB 2, AASB 3, AASB 5,AASB 7, AASB 11, AASB 110, AASB 119, AASB121, AASB 133, AASB 134, AASB 137 & AASB140]

AASB 2015-2 Amendments to AustralianAccounting Standards – Disclosure Initiative:Amendments to AASB 101 [AASB 7, AASB 101,AASB 134 & AASB 1049]



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page 13

AASB 2015-5 Amendments to AustralianAccounting Standards – Investment Entities:Applying the Consolidation Exception [AASB 10,AASB 12 & AASB 128]

AASB 2014-1 Amendments to AustralianAccounting Standards (Part D)

Effective for periods commencing 1 July 2016:

AASB 1056 Superannuation Entities

AASB 2015-6 Amendments to AustralianAccounting Standards – Extending RelatedParty Disclosures to Not-for-Profit Public SectorEntities [AASB 10, AASB 124 & AASB 1049]


AASB 2014-5 Amendments to AustralianAccounting Standards arising from AASB 15

AASB 2015-8 Amendments to AustralianAccounting Standards – Effective Date of AASB15


AASB Financial Instruments (December 2009)

AASB 15 Revenue from Contracts withCustomers

AASB 2010-7 Amendments to AustralianAccounting Standards arising from AASB 9(December 2010)

AASB 2014-1 Amendments to AustralianAccounting Standards (Part E)

AASB 2014-7 Amendments to AustralianAccounting Standards arising from AASB 9(December 2014)


AASB 16 Leases

14 Comparative Figures

To ensure comparability with the current reporting period’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.

15 Disclaimer

Nothing contained within these statements may be taken to be an admission of any liability to any person under any circumstance.



page 14

Town of Gawler


Note 2. Income

$ '000

(a). Rates Revenues

General RatesGeneral RatesLess: Mandatory RebatesLess: Discretionary Rebates, Remissions & Write OffsTotal General Rates

Other Rates (Including Service Charges)Natural Resource Management LevyWaste CollectionSeparate RateTotal Other Rates

Other ChargesPenalties for Late PaymentTotal Other Charges

Total Rates Revenues

(b). Statutory Charges

Development Act FeesHealth & Septic Tank Inspection FeesAnimal Registration Fees & FinesParking Fines / Expiation FeesSundryTotal Statutory Charges

(c). User Charges

Cemetery FeesLease and Property RentsSundryOSHCRecreation Fees and ChargesAquatic Centre Fees and ChargesVisitors Information CentreWaste Disposal Fees and ChargesTotal User Charges

78 79 - 30

0

158 258 105

130

99

404 448 281 239

6

17,150

310 1,795

84

19,502

2,268

84

270

163

2015

80

2,206

80

162

Notes

(299) (330)

16,278

297 1,748

18,362

2016

(853) (882)

17,429

711

18,564

275

229 119

51

245

46 701

33

1,284 1,276

23

102 265



page 15

Town of Gawler


Note 2. Income (continued)

$ '000

(d). Investment Income

Interest on Investments- Local Government Finance Authority- Banks & Other- Loans to Community GroupsDeveloper ContributionsTotal Investment Income

(e). Reimbursements

Vehicle Use ReimbursementsInsurance Claims / RebatesLegal CostsOther CouncilsOtherTotal Reimbursements

(f). Other Income

SundryCommissionsDonationsTotal Other Income

(g). Grants, Subsidies, Contributions

Amounts Received Specifically for New or Upgraded AssetsFinancial Assistance GrantRoads to RecoveryLibrary Operating GrantHome Support Program GrantLocal Roads GrantYouth DevelopmentTown Centre Precinct PlanOther Grants, Subsidies and ContributionsTotal Grants, Subsidies, Contributions

The functions to which these grants relate are shown in Note 12.

- 50

220 86 65

575 552 111 470

3 3

92 15 14

73 56 207 190

453 349

4,746 2,336

47 12 4

223 426

111 1,199

53

603 1,760 624

3

84

18

66 5

2 3

- 94

4

31 38 4 4

3

Notes 2016 2015

82 141

44 -



page 16

Town of Gawler


Note 2. Income (continued)

$ '000

(g). Grants, Subsidies, Contributions (continued)

(i) Sources of grantsCommonwealth GovernmentState GovernmentOtherTotal

(ii) Individually Significant Items

(h). Physical Resources Received Free of Charge

Land & ImprovementsStormwater DrainageKerb & GutterRoads & FootpathsTotal Physical Resources Received Free of Charge

Note 3. Expenses

(a). Employee Costs

Salaries and WagesEmployee Leave ExpenseSuperannuation - Defined Contribution Plan Contributions

Superannuation - Defined Benefit Plan Contributions

Workers' Compensation InsuranceIncome Protection InsuranceLess: Capitalised and Distributed CostsTotal Operating Employee Costs

Total Number of Employees (full time equivalent at end of reporting period)

Commonwealth Financial Assistance Grant - Advance Payments for 2015/2016recognised in 2014/2015

178 458

755

476 462

Notes 2016 2015

1,799 2,737 359 1,551

7,682

4,221 5,461

835 1,399

2,336 4,746

-

132 214

8,492

1,396

107

9,409

18

428 372 100

618 433

8,849

116

(875) (447)

1,013

1,858 2,835

80

18

170 267



page 17

Town of Gawler


Note 3. Expenses (continued)

$ '000

(b). Materials, Contracts and Other Expenses

(i) Prescribed ExpensesAuditor's Remuneration- Auditing the Financial ReportsElected Members' ExpensesElection ExpensesOperating Lease Rentals - Non-Cancellable Leases

- Minimum Lease PaymentsSubtotal - Prescribed Expenses

(ii) Other Materials, Contracts and ExpensesAdvertising, Printing, Postage & FreightBank Charges & Payment Collection AgenciesCanteen Supplies (Cost of Goods Sold)Cleaning & HygieneCommunicationsComputer Software / HardwareConsultants & Agency StaffContractorsContribution - OtherContribution - Gawler Business Development GroupContribution - State Government NRM LevyCorporate MembershipsEnergy (Fuel, Gas, Electricity)Fringe Benefit TaxInsuranceLevies - Emergency ServicesMaintenanceMaterials - Depot StoreMinor Asset PurchasesProperty Valuations (Valuer General Expenses)Rubble, Bitumen, Concrete & Roller HireSecurityStaff TrainingSundryVehicle / Machine Parts & RegistrationsWaste Collection & Disposal ChargesWater Supply & Consumption ChargesLegal Fees (including Debt Recovery)Property RentSubtotal - Other Material, Contracts & Expenses

Total Materials, Contracts and Other Expenses

Notes 2016 2015

115 113

262 250 19 18

22 21 64 100 40 43

159 186 69 61

107 97

95 95 1,840 1,744

528 570 178 190

166 153

310 297 65 82

10,175

18

160 164

1,415 1,240

722 768

17

219 224

118 74

9,829

858 847

6 73

125

1,398

9,696

10,233

80

163 276

404 479

303

161 129

364

19

73 68 68

235 212 127

1,171

163 308



page 18

Town of Gawler


Note 3. Expenses (continued)

$ '000

(c). Depreciation, Amortisation and Impairment

(i) Depreciation and AmortisationInfrastructure- Stormwater Drainage- Roads, Bridges & Footpaths- Roundabouts- Urban ElementsBuildingsEquipmentOther AssetsSubtotal

(ii) ImpairmentBuildingsSubtotal

Total Depreciation, Amortisation and Impairment

(d). Finance Costs

Interest on LoansTotal Finance Costs

Note 4. Asset Disposal & Fair Value Adjustments

Infrastructure, Property, Plant & Equipment

(i) Assets Renewed or Directly ReplacedProceeds from DisposalLess: Carrying Amount of Assets SoldGain (Loss) on Disposal

(ii) Assets Surplus to RequirementsProceeds from DisposalLess: Carrying Amount of Assets SoldGain (Loss) on Disposal

Net Gain (Loss) on Disposal or Revaluation of Assets

711 760

Notes 2016 2015

(410) (323)

1,688

251

29 28 2,688

434 298

94 122

160

237

- - - (22)

173 86 (496) (474)

4,367

- -

4,367 3,289

(410) (301)

- (22)

- 34 - 34

3,323

624 741 624 741

156



page 19

Town of Gawler


Note 5. Current Assets

$ '000

(a). Cash & Cash Equivalents

Cash on Hand at BankDeposits at CallTotal Cash & Cash Equivalents

(b). Trade & Other Receivables

Rates - General & OtherAccrued RevenuesDebtors - GeneralPrepaymentsLoans to Community OrganisationsSubtotal

Less: Allowance for Doubtful DebtsTotal Trade & Other Receivables

(c). Inventories

Stores & MaterialsTotal Inventories 17 20

17 20

1,047 1,406

1,051 1,410 20 22

(4) (4)

178 397

Notes 2016 2015

78 140

1,994 4,899

46 44

1,916 4,759

770 904

37 43



page 20

Town of Gawler


Note 6. Non-Current Assets

$ '000

(a). Financial Assets

ReceivablesLoans to Community OrganisationsTotal Receivables

Total Financial Assets

(b). Equity Accounted Investments in Council Businesses

Gawler River Floodplain Management AuthorityNorthern Adelaide Waste Management AuthorityTotal Equity Accounted Investments in Council Businesses

(c). Other Non-Current Assets

Capital Works-in-ProgressTotal Other

Total Other Non-Current Assets

2,009 1,915

2,962 3,004

45 66

19 645 523

45 66

3,607 3,527

19

2,009 1,915

2,009 1,915

45 66

Notes 2016 2015



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Town of Gawler


Note 7a. Infrastructure, Property, Plant & Equipment

Fair Value At At Carrying At At Carrying

$ '000 Level Fair Value Cost Dep'n Impairment Value Fair Value Cost Dep'n Impairment Value

Land 2 28,569 327 - - 28,896 412 - - - - (1,837) 2,609 30,028 52 - - 30,080 Infrastructure- Stormwater Drainage 3 69,186 - 21,553 - 47,633 1,867 193 (3) (711) - (4,531) - 64,579 604 20,736 - 44,448 - Roads, Bridges & Footpaths 3 173,240 - 28,974 - 144,266 4,648 542 (369) (2,688) - (24,735) 635 156,041 - 33,742 - 122,299 - Roundabouts 3 1,409 - 309 - 1,100 - - - (29) - 40 1,461 - 350 - 1,111 - Urban Elements - 6,492 1,088 - 5,404 48 124 - (94) - - - - 6,489 1,007 - 5,482 Buildings 2 8,710 228 530 - 8,408 208 369 - (251) - - - 8,939 576 781 - 8,734 Equipment - 5,391 2,195 - 3,196 211 678 (91) (434) - - - - 6,014 2,454 - 3,560 Other Assets - 4,260 2,078 - 2,182 498 142 (33) (160) - - - - 4,806 2,177 - 2,629 Total Infrastructure, Property,Plant & Equipment

Comparatives 265,801 13,323 82,663 - 196,461 9,214 2,610 (496) (3,289) (34) (59) 36,679 281,113 16,698 56,728 - 241,084

56,728

Revaluation Incrementsto Equity (ARR)

(Note 9)

Revaluation Decrements

to Equity (ARR)

(Note 9)

AccumulatedAccumulated

as at 30/6/2015

241,084

Impairment Loss

(recognisedin P/L)

(Note 3c)

7,892 (496) 2,048

Asset Additions

Asset Movements during the Reporting Periodas at 30/6/2016

Depreciation Expense (Note 3c)

WDVof Asset

DisposalsNew / Upgrade Renewals

3,284 218,342 (31,103) 61,246 - 18,540 281,113 16,698 261,048 - (4,367) -



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Town of Gawler


Note 7b. Valuation of Infrastructure, Property, Plant & Equipment

Valuation of Assets

The fair value of assets and liabilities must be estimated in accordance with various Accounting Standards for eitherrecognition and measurement requirements or for disclosure purposes.

AASB 13 Fair Value Measurement requires all assets and liabilities measured at fair value to be assigned to a "level"in the fair value hierarchy as follows:

Level 1: Unadjusted quoted prices in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2: Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).

Refer to Note 7a for the disclosure of the Fair Value Levels of Infrastructure, Property, Plant and Equipment Assets.

Information on Valuations

The entity selects valuation techniques that are appropriate in the circumstances and for which sufficient data is available to measure fair value. The availability of sufficient and relevant data primarily depends on the specific characteristics of the asset or liability being measured. The valuation techniques selected by the entity are consistent with one or more of the following valuation approaches:

- Market approach: uses prices and other relevant information generated by market transactions involving identical orsimilar assets or liabilities.- Income approach: converts estimated future cash flows or income and expenses into a single current (ie

discounted) value.- Cost approach: reflects the current replacement cost of an asset at its current service capacity.

Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing the asset or liability, including assumptions about risks. When selecting a valuation technique, the entity gives priority to those techniques that maximise the use of observable inputs and minimise the use of unobservable inputs. Inputs that are developed using market data (such as publicly available information on actual transactions) and reflect the assumptions that buyers and sellers would generally use when pricing the asset or liability are considered observable, whereas inputs for which market data are not available and therefore are developed using the best information available about such assumptions are considered unobservable.



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Town of Gawler


Note 7b. Valuation of Infrastructure, Property, Plant & Equipment (continued)

Valuation of Assets (continued)

Other Information

At 1 July 2004 upon the transition to AIFRS, Council elected pursuant to AASB 1.19 to retain a previously establisheddeemed cost under GAAP as its deemed cost. With subsequent addition at cost, this remains as the basis ofrecognition of non-material asset classes.

Upon revaluation, the current new replacement cost and accumulated depreciation are re‐stated such that the difference represents the fair value of the asset determined in accordance with AASB 13 Fair Value Measurement: accumulated depreciation is taken to be the difference between current new replacement cost and fair value. In the case of land, current replacement cost is taken to be the fair value.

Highest and best use

All of Council's non financial assets are considered as being utilised for their highest and best use.

Transition to AASB 13 - Fair Value Measurement

The requirements of AASB 13 Fair Value Measurement have been applied to all valuations undertaken since 1 July 2013 as shown by the valuation dates by individual asset classes below.

Land- Basis of valuation: Market Value- Date of valuation: 30 June 2016- Valuer: Valuer General, GPO BOX 1354, Adelaide SA 5001

Buildings- Basis of valuation: Market Value- Date of valuation: 30 June 2015- Valuer: Chris Chaney of Asset Valuation & Consulting Pty Ltd, 32 Fourth St, St Peters SA 5069

InfrastructureRoads, Bridges & Footpaths- Basis of valuation: Written down current replacement cost- Date of valuation: 30 June 2016- Valuer: Steve Walker of Asset Engineering, PO BOX 211, Plympton SA 5038

Stormwater Drainage- Basis of valuation: Written down current replacement cost- Date of valuation: 30 June 2016- Valuer: Steve Walker of Asset Engineering, PO BOX 211, Plympton SA 5038



page 24

Town of Gawler


Note 7b. Valuation of Infrastructure, Property, Plant & Equipment (continued)

$ '000

Infrastructure (continued)Roundabouts

- Basis of valuation: Written down current replacement cost- Date of valuation: 30 June 2016- Valuer: Steve Walker of Asset Engineering, PO BOX 211, Plympton SA 5038

Urban Elements- Recognition at Cost

Plant & Equipment- Recognition at Cost

All other Assets- Recognition at Cost

As a result of a change in interpretation of AASB116, the depreciation charge in 2015/2016 has increased significantly. Review to be undertaken in 2016/2017 of both condition and useful life of infrastructure assets may reducethis increase depreciation charges.

Note 8. Liabilities

$ '000

(a). Trade and Other Payables

Goods & ServicesPayments Received in AdvanceAccrued Expenses - Employee EntitlementsAccrued Expenses - OtherDeposits, Retentions & BondsTotal Trade and Other Payables

(b). Borrowings

LoansTotal Borrowings

All interest bearing liabilities are secured over the future revenues of the Council.

Changes in accounting estimates per AASB108 have resulted in a net decrease in the carrying amount of infrastructure assets as shown in Note 7. These changes related to net downward movements in unit rates based on revised measurement methodology and pricing, componentisation of infrastructure assets into long life and short life assets and revision of infrastructure asset data based on engineering sample analysis.

Non Current

- -

703

-

-

1,231 7,421

2,796 600

- 394

8,652

245 - 281

430 - -

226

2,169

4,217

1,231 2,169 7,421

Notes2016

- 350

20152015Non Current Current

2,186 -

- 3,994

-

8,652

2016Current



Town of Gawler


Note 8. Liabilities

$ '000

(c). Provisions

Total Provisions

Note 9. Reserves

$ '000

(a). Asset Revaluation Reserve

LandInfrastructure- Stormwater Drainage- Roads, Bridges & Footpaths- RoundaboutsJV's / Associates - Other Comprehensive Income

Total Asset Revaluation ReserveComparatives

$ '000

(b). Other Reserves

CarparkingOpen SpaceStormwater DrainagePlant & Machinery ReplacementWillaston CemeteryWillaston Cemetery - Babies MemorialWaste Management Service ChargeInfrastructure & Community AssetsPropertyDog & Cat ManagementHistoric WallsProperty ImprovementUrban Tree FundTotal Other ReservesComparatives

2016 2016 2015 2015Notes Current Non Current Current Non Current

- 1 - - 1

113 11 (33) - 91

Employee Entitlements for Long Service Leave (including oncosts)Employee Entitlements for Annual Leave (including oncosts)

24 24 - 5 - - 5

211 - (211) - -1,435 25 - - 1,460

- 27,784

(4,531) - - 37,872

-

183 - (93) - 90

193 178 (142) - 229 156 53 (209) - -

(814)

-

-

- - 48

(96) -

1/7/2015 Increments (Decrements)

547 - -

(12)

187,696 159,877

(2,411) - -

151

151

-

30/6/2016

143 1,170

1,130 - 962 - 2,371 2,132

1,241

143

2,851

- -

433

- 547

-

1/7/2015 Tfrs from Reserve

Other Movements 30/6/2016

4,531 2,851

731 358 2,395

Tfrs to Reserve

151,195 36,501 -

Transfers Impairments

-

Notes

187,696

1,060 40 - - 116,674 (24,100) - - 92,574 42,403

Notes

1,100

27,012 772

53 - (16) - 37 3 - (2) - 1

436 9

(27,819)

44 52



Town of Gawler


Note 9. Reserves (continued)

$ '000

(b). Other Reserves (continued)

PURPOSES OF RESERVESAsset Revaluation ReservesThe asset revaluation reserve is used to record increments and decrements arising from changes in fair value ofnon current assets (less any subsequent impairment losses, where applicable).

The infrastructure asset revaluation reserve opening balance was proportioned by asset classes based on thewritten-down value of applicable assets classes. The 2015-2016 revaluation movement has been applied to thesebalances.

StormwaterThis reserve is used for the retention of developer contributions towards the provision of stormwater infrastructure.

Carparking ReserveThis reserve is used for the retention of developer contributions towards the provision of carpark facilities.

Footpath ReserveThis reserve is used for the retention of developer contributions towards the construction of new footpaths.

Open Space ReserveThis reserve is used for the retention of developer contributions received towards the provision of facilities within Council's Community Parks, Gardens and Open Spaces.

Plant & Machinery Replacement ReserveThis reserve is used for the provision of funding towards the programmed replacement of Council's Plant & Machinery

Cemetery ReserveThis reserve is used for the development and enhancement of facilities at the Willaston Cemetery.

Waste Management Service Charge ReserveCouncil applies an annual charge for the provision of waste management services, pursuant to section 155 of the Local Government Act 1999. In instances where surplus funds are generated (i.e. where the funds generated fromthe service charge exceed the cost providing the service) this reserve is credited with the surplus. The balance ofthe funds in the Reserve will be transferred from the Reserve and rebated to customers during 2016/2017.

Infrastructure & Community ReserveThis reserve is used for the planning and design of infrastructure and community assets. This reserve will no longerbe recognised as from 30 June 2016.

Property ReserveThis reserve is used for future infrastructure and property development.

Historic Walls ReserveThis reserve is used to fund the Historic Walls Grant Scheme.

Dog & Cat Management ReserveThis reserve is used to fund future initiatives relating to Dog and Cat Management.

Urban Trees Fund ReserveThis reserve is used to fund the maintenance or planting of trees in a designated area which are or will (when fully grown) constitute as significant trees.

Property Improvement ReserveThis reserve is to hold discretionary rebates withheld for commercial properties in the Town Centre deemed to be in a state of neglect that detracts significantly from the amenity of the locality.

1/7/2015 Increments (Decrements) Transfers Impairments 30/6/2016

Notes



page 27

Town of Gawler


Note 10. Assets Subject to Restrictions

$ '000

The uses of the following assets are restricted, wholly or partially, by legislation or other externally imposed requirements. The assets are required to be utilised for the purposes for which control was transferred to Council, or for which the revenues were originally obtained.

Cash & Financial AssetsUnexpended amounts received from Federal GovernmentDeveloper ContributionsSouthern Urban Areas Developer ContributionsTotal Assets Subject to Externally Imposed Restrictions

Note 11. Reconciliation to Statement of Cash Flows

(a). Reconciliation of Cash

Cash Assets comprise highly liquid investments with short periods tomaturity subject to insignificant risk of changes of value. Cash at theend of the reporting period as shown in the Statement of Cash Flowsis reconciled to the related items in the Balance Sheet as follows:

Total Cash & Equivalent AssetsBalances per Statement of Cash Flows

(b). Reconciliation of Change in Net Assets to Cash from Operating Activities

Net Surplus/(Deficit)Non-Cash Items in Income Statements Depreciation, Amortisation & Impairment Equity Movements in Equity Accounted Investments (Increase)/Decrease Non-Cash Asset Acquisitions Grants for Capital Acquisitions (Treated as Investing Activity Receipts) Net (Gain) Loss on Disposals

Add (Less): Changes in Net Current Assets Net (Increase)/Decrease in Receivables Change in Allowances for Under-Recovery of Receivables Net (Increase)/Decrease in Inventories Net (Increase)/Decrease in Other Current Assets Net Increase/(Decrease) in Trade & Other Payables Net Increase/(Decrease) in Other ProvisionsNet Cash provided by (or used in) operations

1,994 4,899

53 1,460

4,367

4,899

(80) (70) (5,461)

(111) (1,199)

-

1,994

3,679 7,915

3,323

260 1,002

410 323 4,044 4,831

358

3 (3) - (143)

(46) 71

5

437 4,895 6,150

231

1,435

2016 2015Notes

249

(4,221)

1,684 1,513



page 28

Town of Gawler


Note 11. Reconciliation to Statement of Cash Flows (continued)

$ '000

(c). Non-Cash Financing and Investing Activities

Acquisition of assets by means of:- Physical Resources Received Free of Charge

Amounts recognised in Income StatementTotal Non-Cash Financing & Investing Activities

(d). Financing Arrangements

Unrestricted access was available at balance date to the following lines of credit:

Corporate Credit CardsLGFA Cash Advance Debenture Facility

The bank overdraft facilities may be drawn at any time and may be terminated by the bank without notice. Council also has immediate

access to a short-term draw down facility and variable interest rate borrowings under a cash advance facility, both from the Local

Government Finance Authority of SA.

Notes 2016 2015

4,221 5,461 2h

29 29

4,221 5,461 4,221 5,461

3,687 3,687



page 29

Town of Gawler


Note 12a. Functions

Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual$ '000 2016 2015 2016 2015 2016 2015 2016 2015 2016 2015

Business Undertakings 230 225 40 32 190 193 - - 2,617 2,654 Community Services 899 862 1,821 1,679 (922) (817) 639 617 8,116 8,238 Culture 122 103 1,015 1,002 (893) (899) 86 65 751 824 Economic Development 245 244 389 507 (144) (263) - - 1,185 1,164 Environment 2,110 2,078 2,354 2,185 (244) (107) - 215 2,162 1,708 Recreation 764 776 3,197 3,407 (2,433) (2,631) 15 330 26,955 27,838 Regulatory Services 423 399 1,727 1,654 (1,304) (1,255) 53 391 77 42 Transport & Communication 735 695 4,013 3,017 (3,278) (2,322) 735 690 509 621 Plant Hire & Depot/Indirect 16 15 (139) (328) 155 343 14 11 2,750 2,469 Unclassified Activities - - - - - - - - 20 36 Council Administration 18,766 19,199 10,216 9,933 8,550 9,266 683 1,228 181,920 207,323

Total Functions/Activities 24,310 24,596 24,633 23,088 (323) 1,508 2,225 3,547 227,062 252,917

Revenues and expenses exclude net gain (loss) on disposal or revaluation of assets, net gain (loss) from joint ventures & associated entities, amounts received specifically for new or upgraded assets and physical resources received free of charge.

Details of these Functions/Activities are provided in Note 12(b).

Functions/Activities

Income, Expenses and Assets have been directly attributed to the following Functions / Activities.

INCOME EXPENSES OPERATINGSURPLUS (DEFICIT)

TOTAL ASSETS HELD (CURRENT &

NON-CURRENT)

GRANTS INCLUDEDIN INCOME



page 30

Town of Gawler


Note 12b. Components of Functions

$ '000

The activities relating to Council functions are as follows:

BUSINESS UNDERTAKINGS

COMMUNITY SERVICES

CULTURE

ECONOMIC DEVELOPMENT

ENVIRONMENT

RECREATION

REGULATORY SERVICES

TRANSPORT

PLANT HIRE & DEPOTPlant & Machinery maintenance & repairs, Depot maintenance expenses.

UNCLASSIFIED ACTIVITIESRoad reserve maintenance, 'Rapid Response' team service and other sundry activities.

COUNCIL ADMINISTRATION

Caravan Parks, Development of Land for Resale.

Public Order and Safety, Crime Prevention, Emergency Services, Other Fire Protection, Other Public Order and Safety,Health Services, Pest Control – Health, Immunisation, Preventive Health Services, Other Health Services, CommunitySupport, Elderly Citizens Facilities, Home Support Program, Children and Youth Services, Community Assistance,Family and Neighbourhood Support, Other Community Support, Community Amenities, Bus Shelters, Cemeteries, PublicConveniences, Car Parking – non-fee-paying and Other Community Amenities.

Library Services, Other Library Services, Cultural Services, Heritage and Other Cultural Services.

Regional Development, Support to Local Businesses, Tourism, and Other Economic Development.

Landcare, Other Agricultural Services, Waste Management, Domestic Waste, Green Waste, Recycling, Waste DisposalFacility, Other Waste Management, Other Environment, Stormwater and Drainage, Street Cleaning, Street Lighting,Streetscaping, Natural Resource Management Levy, and Other Environment.

Parks and Gardens, Sports Facilities – Indoor, Sports Facilities – Outdoor, Aquatic Centre – Outdoor, and OtherRecreation.

Dog and Cat Control, Building Control, Town Planning, Litter Control, Health Inspection, Parking Control, and OtherRegulatory Services.

Bridges, Footpaths and Kerbing, Roads – sealed, Roads – formed, Roads – natural formed, Roads – unformed, TrafficManagement, LGGC – roads (formula funded), and Other Transport.

Governance, Administration n.e.c., Elected Members, Organisational, Support Services, Accounting/Finance, Payroll,Human Resources, Information Technology, Communication, Rates Administration, Records, Occupancy, ContractManagement, Customer Service, Other Support Services, Revenues, LGGC – General Purpose, and Separate andSpecial Rates.



page 31

Town of Gawler


Note 13. Financial Instruments

$ '000

Recognised Financial Instruments

Bank, Deposits at Call, Short Term Deposits Accounting Policy:Carried at lower of cost and net realisable value; Interest isrecognised when earned.

Terms & Conditions:Deposits are returning fixed interest rates between 1.75% and 2% (2015: 2% and 2.5%). Short term deposits have an average maturity of 30 days and an average interest rate of2.3% (2015: 30 days and 3%).

Carrying Amount:Approximates fair value due to the short term to maturity.

Receivables Accounting Policy:Rates & Associated Charges Carried at nominal values less any allowance for doubtful debts.(including legals & penalties for late payment) An allowance for doubtful debts is recognised (and re-assessed

annually) when collection in full is no longer probable.Note: These receivables do not meet the definitionof "financial instruments" and have been excluded Terms & Conditions:from the following disclosures. Secured over the subject land, arrears attract interest of 2%

(2015: 2%). Council is not materially exposed to any individualdebtor, credit risk exposure is concentrated within the Council's boundaries in the State.

Carrying Amount:Approximates fair value (after deduction of any allowance).

Receivables Accounting Policy:Fees & Other Charges Carried at nominal values less any allowance for doubtful debts.

An allowance for doubtful debts is recognised (and re-assessed annually) when collection in full is no longer probable.

Terms & Conditions:Unsecured, and do not bear interest. Council is not materiallyexposed to any individual debtor, credit risk exposure isconcentrated within the Council's boundaries.




page 32

Town of Gawler


Note 13. Financial Instruments (continued)

$ '000


Receivables Accounting Policy:Other Levels of Government Carried at nominal value.

Terms & Conditions:Amounts due have been calculated in accordance with theterms and conditions of the respective programs followingadvice of approvals, and do not bear interest. All amountsare due by Departments and Agencies of State and FederalGovernments.

Carrying Amount:Approximates fair value.

Receivables Accounting Policy:Retirement Home Contributions Carried at nominal values less any allowance for doubtful debts.

An allowance for doubtful debts is recognised (and re-assessed annually) when collection in full is no longer probable.

Terms & Conditions:Amounts due have been calculated in accordance with the termsand conditions of the respective legislation.


Liabilities Accounting Policy:Creditors and Accruals Liabilities are recognised for amounts to be paid in the future for

goods and services received, whether or not billed to the Council.

Terms & Conditions:Liabilities are normally settled on 30 day terms.




page 33

Town of Gawler



$ '000


Liabilities Accounting Policy:Retirement Home Contributions To avoid inconvenience when complying with the separate audit

requirements imposed by the relevant legislation, amounts arecarried at nominal values.

Terms & Conditions:Pursuant to Commonwealth legislation certain intending residents are required to contribute amounts on an interest free basis. The amounts are subject to certain deductions as prescribed by the legislation, the balance being repaid ontermination of tenancy.

Carrying Amount:Approximates fair value for short tenancies; may be non-materially overstated for longer tenancies.

Liabilities Accounting Policy:Interest Bearing Borrowings Carried at the principal amounts. Interest is charged as an

expense as it accrues.

Terms & Conditions:Secured over future revenues, borrowings are repayable (describe basis); interest is charged at fixed (or variable - describe) rates between 4.7% and 7.9% (2015: 4.7% and 8.4%).


Liabilities Accounting Policy:Finance Leases Accounted for in accordance with AASB 117.



page 34

Town of Gawler



$ '000

2016Financial AssetsCash & EquivalentsReceivablesTotal Financial Assets

Financial LiabilitiesPayablesCurrent BorrowingsNon-Current BorrowingsTotal Financial Liabilities

$ '000

2015Financial AssetsCash & EquivalentsReceivablesTotal Financial Assets

Financial LiabilitiesPayablesCurrent BorrowingsNon-Current BorrowingsTotal Financial Liabilities

The following interest rates were applicableto Council's Borrowings at balance date:

Fixed Interest Rates

Net Fair ValueAll carrying values approximate fair value for all recognised financial instruments . There is no recognised market forthe financial assets of the Council.

10,821 8,652 6.60% 8,652 6.75% 10,821

Due

< 1 year

- 5,392 5,424

5,983 6,909 - 6,909

< 1 year & ≤ 5 years

-

- 6,381 1,231

219 20 20 -

4,453

-

Due> 5 years

3,641

493

3,746 - 1,293 -

427

-

6,381

2,806 -

5,326 66

3,177

5,039

2,213 285

ValuesCash Flows

3,746

- 2,169

1,994 -

Carrying

1,900

CarryingInterest RateValue

- 2,806 3,171

-

Due > 1 year

- 4,899 4,899 66

11,362

1,900

30 June 2015

4,453 8,652

525

-

> 5 years

CarryingDue > 1 yearDue& ≤ 5 years

8,281 7,421

17,345

13,320 12,294

13,992

CarryingValue

1,293

1,994 1,994

2,233 2,279

- 4,899

- 239

Cash Flows ValuesDue

3,177

30 June 2016

Interest RateWeighted Avg Weighted Avg

Total Contractual

Total Contractual



page 35

Town of Gawler



$ '000

Risk Exposures

Credit Risk represents the loss that would be recognised if counterparties fail to perform as contracted. The maximum credit risk on financial assets of the Council is the carrying amount, net of any allowance for doubtful debts. All Councilinvestments are made with the SA Local Government Finance Authority and are guaranteed by the SA Government.Except as detailed in Notes 5 & 6 in relation to individual classes of receivables, exposure is concentrated within theCouncil's boundaries, and there is no material exposure to any individual debtor.

Market Risk is the risk that fair values of financial assets will fluctuate as a result of changes in market prices. Allof Council's financial assets are denominated in Australian dollars and are not traded on any market, and henceneither market risk nor currency risk apply.

Liquidity Risk is the risk that Council will encounter difficulty in meeting obligations with financial liabilities. In accordance with the model Treasury Mangement Policy (LGA Information Paper 15), liabilities have a range ofmaturity dates. Council also has available a range of bank overdraft and standby borrowing facilities that it can access.

Interest Rate Risk is the risk that future cash flows will fluctuate because of changes in market interest rates.Council has a balance of both fixed and variable interest rate borrowings and investments. Cash flow fluctuations aremanaged holistically in seeking to minimise interest costs over the longer term in a risk averse manner.



page 36

Town of Gawler


Note 14. Commitments for Expenditure

$ '000

(a). Capital Commitments

Capital expenditure committed for at the reporting date but notrecognised in the financial statements as liabilities:

Infrastructure

These expenditures are payable:Not later than one yearLater than one year and not later than 5 yearsLater than 5 years

(b). Other Expenditure Commitments

Other expenditure committed for (excluding inventories) at the reportingdate but not recognised in the financial statements as liabilities:

Audit ServicesEmployee Remuneration Contracts

These expenditures are payable:Not later than one yearLater than one year and not later than 5 yearsLater than 5 years -

-

Notes

- 295

- -

3,580

-

119 3,461

968 2,410 1,540

- 3,580

295

- 295

2016 2015

- -

295

146 2,362 2,508

1,170

2,508



page 37

Town of Gawler


Note 15. Financial Indicators

$ '000

1. Operating Surplus RatioOperating SurplusTotal Operating Revenue

This ratio expresses the operating surplus as a percentage of totaloperating revenue.

1a. Adjusted Operating Surplus RatioIn recent years the Federal Government has made advance payments prior

to 30th June from future year allocations of financial assistance grants, as

explained in Note 1. The Adjusted Operating Surplus Ratio adjusts for the

resulting distortion in the disclosed operating result for each year.

2. Net Financial Liabilities RatioNet Financial LiabilitiesTotal Operating Revenue

Net Financial Liabilities are defined as total liabilities less financial assets

(excluding equity accounted investments in Council businesses). These are

expressed as a percentage of total operating revenue.

3. Asset Sustainability RatioNet Asset RenewalsInfrastructure & Asset Management Plan required expenditure

Net asset renewals expenditure is defined as net capital expenditure on

the renewal and replacement of existing assets, and excludes new

capital expenditure on the acquisition of additional assets.

These Financial Indicators have been calculated in accordance with Information paper 9 - Local Government Financial Indicators prepared as part of the LGA Financial Sustainability Program for the Local Government Association of South Australia.

(41%)6%24,432

(1%)(243)

Amounts2016 2016 2015 2014

Indicator Prior Periods

12,297 50% 43% 49%24,432

2,695 97% 66% 16%2,780

24,432 512

2% 3% (37%)



page 38

Town of Gawler


Note 15. Financial Indicators - Graphs (continued)

Purpose of Operating Surplus Ratio

This indicator is to determine the

percentage the operating revenue varies from

operating expenditure

Commentary on 2015/16 Result

2015/16 Ratio -1%

The Operating Deficit of $243K was influenced by the increase in expenditure for

employee costs ($253K) and materials, contracts and other expenses ($163K).

Additionally , the Financial Assistance Grant advance payment was discontinued in

2015/2016 ($755K).

Purpose of Adjusted Operating Surplus

Ratio


2015/16 Ratio 2%

This indicator is to determine the

percentage the operating revenue (adjusted for

timing differences in the Financial Assistance Grant) varies from

operating expenditure

Council did not receive an advanced Financial Assistance Grant payment in 2015-

2016. This ratio represents Councils operating result including the payment made

in advance in 2014-2015.

Purpose of Net Financial Liabilites

Ratio


2015/16 Ratio 50%

This indicator shows the significance of the net amount owed to others, compared to operating revenue

While borrowings decreased by $2.1M during 2015/2016, investments also decreased by $2.91M. This has resulted in an increase in

the Net Financial Liabilities Ratio to 50% from 43% in 2014/2015.

Purpose of Asset Sustainability Ratio


2015/16 Ratio 97%

This indicator aims to determine if assets are

being renewed and replaced in an optimal

way

The Asset sustainability Ratio is based on the capital expenditure for the replacement and renewal of assets as indicated in the

Asset Management Plan and 10 year Long Term Financial Plan. The target range is 90-

100%. The ratio for 2015-2016 is 97%.

-41%

6%

-1%

-50%-40%-30%-20%-10%

0%10%

2014 2015 2016

Rat

io %

1. Operating Surplus Ratio

-37%

3% 2%

-50%-40%-30%-20%-10%

0%10%

2014 2015 2016

Rat

io %

1a. Adjusted Operating Surplus Ratio

49%

43%

50%

40%42%44%46%48%50%52%54%

2014 2015 2016

Rat

io %

2. Net Financial Liabilities Ratio

16%

66%

97%

0%20%40%60%80%

100%120%

2014 2015 2016

Rat

io %

3. Asset Sustainability Ratio



page 39

Town of Gawler


Note 16. Uniform Presentation of Finances

$ '000

The following is a high level summary of both operating and capital investment activities of the Council prepared on a simplified Uniform Presentation Framework basis.

All Councils in South Australia have agreed to summarise annual budgets and long-term financial plans on the same basis.

The arrangements ensure that all Councils provide a common 'core' of financial information, which enables meaningful comparisons of each Council's finances.

Incomeless ExpensesOperating Surplus / (Deficit)

less Net Outlays on Existing Assets Capital Expenditure on Renewal and Replacement of Existing Assets less Depreciation, Amortisation and Impairment less Proceeds from Sale of Replaced AssetsSubtotal

less Net Outlays on New and Upgraded Assets

less Amounts Received Specifically for New and Upgraded Assets

Subtotal

Net Lending / (Borrowing) for Financial Year

(173)

2015

(1,672)

(111) (1,199)

24,731 24,432 (24,675) (23,153)

1,578 (243)

(1,124)

(4,367)

(1,492) 42

2,921

2,781 2,371

2,661

(3,323) (86)

3,032 3,860

2016

Capital Expenditure on New and Upgraded Assets (including Investment Property & Real Estate Developments)



page 40

Town of Gawler


Note 17. Operating Leases

$ '000

Leases Providing Revenue to the Council

Lease commitments under all non-cancellable lease agreements,including those relating to Investment Property, are as follows:

Not later than one yearLater than one year and not later than 5 yearsLater than 5 years

(ii) Lease Payment Commitments of Council

Council has entered into non-cancellable operating leases for various items of computer hardware.

No lease imposes any additional restrictions on Council in relation to additionaldebt or further leasing.

Leases in relation to computer and office equipment permit Council, at expiryof the lease, to elect to re-lease, return or acquire the equipment leased

Not later than one yearLater than one year and not later than 5 yearsLater than 5 years

85

444

1,007

Commitments under non-cancellable operating leases that have not been recognised in the financial statements are as follows:

Council owns various buildings, plant and other facilities that are available for hire or lease (on a non-cancellable basis wherever practicable) in accordance with the published revenue policy. Rentals received from such leases are disclosed as rent and hire of non-investment property in Note 2.

152

2,212 1,954

1,146

128 -

292 -

818 701

246 248

2016 2015

213



page 41

Town of Gawler


Note 18. Superannuation

$ '000

The Council makes employer superannuation contributions in respect of its employees to Statewide Super (formerly Local Government Superannuation Scheme). There are two types of membership, each of which is funded differently. Permanent and contract employees of the South Australian Local Government sector with Salarylink benefits prior to 24 November 2009 have the option to contribute to the Accumulation section and/or Salarylink. All other employees (including casuals) have all contributions allocated to the Accumulation section.

Accumulation only MembersAccumulation only members receive both employer and employee contributions on a progressive basis. Employer contributions are based on a fixed percentage of ordinary time earnings in accordance with superannuation guarantee legislation (9.50% in 2015/16; 9.50% in 2014/15). No further liability accrues to the Council as the superannuation benefits accruing to employees are represented by their share of the net assets of the Fund.

Salarylink (Defined Benefit Fund) MembersSalarylink is a defined benefit scheme where the benefit payable is based on a formula determined by the member’s contribution rate, number of years and level of contribution and final average salary. Council makes employer contributions to Salarylink as determined by the Fund’s Trustee based on advice from the appointed Actuary. The rate is currently 6.3% (6.3% in 2014/15) of “superannuation” salary.

In addition, Council makes a separate contribution of 3% of ordinary time earnings for Salarylink members to their Accumulation account. Employees also make member contributions to the Salarylink section of the Fund. As such, assets accumulate in the Salarylink section of the Fund to meet the member's benefits, as defined in the Trust Deed, as they accrue.

The Salarylink section is a multi-employer sponsored plan. As the Salarylink section's assets and liabilities are pooled and are not allocated by each employer, and employees may transfer to another employer within the local government sector and retain membership of the Fund, the Actuary is unable to allocate benefit liabilities, assets and costs between employers. As provided by AASB 119.32(b), Council does not use defined benefit accounting for these contributions.

The most recent actuarial investigation was conducted by the Fund's actuary, A C Miller, FIAA, of Russell Employee Benefits Pty Ltd as at 30 June 2014. The Trustee has determined that the current funding arrangements are adequate for the expected Salarylink liabilities. However, future financial and economic circumstances may require changes to Council’s contribution rates at some future time.

Contributions to Other Superannuation Schemes Council also makes contributions to other superannuation schemes selected by employees under the “choice of fund” legislation. All such schemes are of the accumulation type, where the superannuation benefits accruing to the employee are represented by their share of the net assets of the scheme, and no further liability attaches to the Council.



page 42

Town of Gawler


Note 19. Interests in Other Entities

$ '000

All joint ventures and associates are required to prepare Annual Financial Statements thatcomply with the SA Local Government Model Financial Statements.

Joint VenturesTotal

(i) JOINT VENTURES, ASSOCIATES AND JOINT OPERATIONS

(a) Carrying Amounts

Name of Entity Principal Activity

Total Carrying Amounts - Joint Ventures & Associates

Northern Adelaide Waste Management AuthorityEstablished by Town of Gawler, City of Playford and the City of Salisbury, NAWMA is responsible for the provisionof Waste Management Services.

Gawler River Floodplain Management AuthorityEstablished by Town of Gawler, City of Playford, Adelaide Hills Council, The Barossa Council, Light RegionalCouncil and the District of Mallala. GRFMA is responsible for the co-ordination of construction and management of projects.

(b) Relevant Interests

Name of EntityNorthern Adelaide Waste Management AuthorityGawler River Floodplain Management Authority

(c) Movement in Investment in Joint Venture or Associate

Opening BalanceShare in Operating ResultShare in Other Comprehensive IncomeCouncil's Equity Share in the Joint Venture or Associate

Provision of waste management servicesManagement and co-ordination of flood mitigation projects

Operating Share of Proportion of

645 523 2,962 3,004

33% 33%

2016 2015 2016 2015523 507 3,004 3,069 122 135 (42) (65)

- (119) - -

17%

2016

80 2015

3,607 80 70 3,607 3,527

2015 2016 2015 2016 20159% 9% 9% 9%

17% 17% 17% 16% 16%

Interest in Ownership

Northern Adelaide Waste Management Authority

Gawler River Floodplain Management Authority

3,607

Northern Adelaide Waste Management Authority 645 523 Gawler River Floodplain Management Authority 2,962 3,004

2015

Council's Share of Net AssetsCouncil's Share of Net Income

3,527 2016 2015 2016

70

3,527

Result Equity Voting Power2016



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Town of Gawler


Note 19. Interests in Other Entities (continued)

$ '000

(d) Summarised Financial Information of the Equity Accounted Business

Statement of Financial Position

Cash and Cash EquivalentsOther Current AssetsNon-Current AssetsTotal Assets

Current Trade and Other PayablesCurrent Financial LiabilitiesCurrent ProvisionsNon-Current Financial LiabilitiesNon-Current ProvisionsTotal LiabilitiesNet Assets

Statement of Comprehensive Income

Other IncomeContributions from Constituent CouncilsInterest IncomeTotal Income

Employee CostsMaterials, Contracts & Other ExpensesDepreciation, Amortisation and ImpairmentFinance CostsTotal Expenses

Other Revenue / Expense ItemsOperating Result

1,374 1,475 231 231 246 224 - -

24,817 23,524 301 447

(5) (8) (19) 12

4 9 26,199 24,986 79 81

1,731 1,353 - - 21,466 20,472



2016 2015 2016 2015

1,579 1,305 - -2,243 2,238 - 3

318 293 - -2,518 1,597 - -

9,214 7,525 - 3 6,937 5,626 17,175 17,417

2,556 2,092 - -



2016 2015 2016 20153,600 4,212 2 11 2,852 3,061 199 204

322 155 - - 25,629 24,625 75 72

248 206

1,377 1,454 (241) (354)

70 216

9,699 5,878 16,974 17,205 16,151 13,151 17,175 17,420



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Town of Gawler


Note 19. Interests in Other Entities (continued)

$ '000

(e). Share of Joint Operations Expenditure Commitments

Expenditure committed for (excluding inventories) at the reporting date but not recognised in the financial statements as liabilities:

Operating Expenditures PayableNot later than one yearLater that one year and not later than 5 yearsLater than 5 years

Northern Adelaide Waste Management Authority entered into an agreement in March 2016 to purchase a propertyat Woomera Ave, Edinburgh North for an estimated $5.3M. A deposit of $50K (GST Inclusive) was paid in March2016. The acquisition of the premises is subject to a Development Application being granted for the site which isexpected to be assessed by the City of Salisbury in September 2016. The potential acquisition of the premises is not subject to finance and will be funded by a 20 year external loan facility.

In addition to the above, Northern Adelaide Waste Management Authority has a performance bond/guarantee heldwith the Local Government Finance Authority to the Enviornment Protection Authority for an amount of $1.350M inaccordance with the requirements under its Post Closure remediation obligations for the Uleybury Landfill site.

Note 20. Non-Current Assets Held for Sale & Discontinued Operations

Council does not have any Non-Current Assets Held for Sale or any Discontinued Operations

Note 21. Contingencies & Assets/Liabilities Not Recognised in the Balance Sheet

The following assets and liabilities do not qualify for recognition in the Balance Sheet, but it is acknowledgedthat it is considered relevant to the users of the financial report in making and evaluating decisions about theallocation of scarce resources.

1. LAND UNDER ROADS

As reported in the Financial Statements, Council is of the opinion that it is not possible to attribute a value sufficiently reliably for these assets to qualify for recognition, and accordingly land under roads has not been recognised in the reports. Land acquired for road purposes during the year is initially recognised at cost, but transferred to fair value at reporting date, effectively writing off the expenditure.

At reporting date, Council controlled 199 km of road reserves of average width 14 metres.

20,003

- 8,299

29,885 21,816

13,517 9,882

-



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Town of Gawler


Note 21. Contingencies & Assets/Liabilities Not Recognised in the Balance Sheet

2. POTENTIAL INSURANCE LOSSES

Council is a multi-purpose organisation providing a large range of building, parks infrastructure, playgrounds and other facilities accessible to the public. At any time, it is likely that claims will have been made against Council that remain unsettled.

Council insures against all known insurable risks using a range of insurance policies, each of which is subject to deductable "insurance excesses", the amount of which varies according to the class of insurance.

Council has recognised the potential losses arising from claims known at reporting date based on average historical net cost (including insurance excess) of similar types of claims. Other potential claims not reported to Council may have existed at reporting date.

3. LEGAL MATTERS

Council is the planning consent authority for its area under the Development Act 1993 (as amended). Pursuant to that Act, certain persons aggrieved by a planning decision of the Council may appeal. It is normal practice that parties bear their own legal costs. At the date of these reports, Council had notice of 3 appeals against planning decisions made prior to reporting date. All known costs have been recognised, but the amount of further costs cannot be known until the appeals are determined.

Note 22. Events after the Balance Sheet Date

Events that occur after the reporting date of 30 June 2016, up to and including the date when the financialstatements 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 appropriate "authorised for issue" daterelating to these General Purpose Financial Statements.

Accordingly, the "authorised for issue" date is 05/10/16.

Council is aware of the following "non adjusting events" that merit disclosure;

Subsequent to the 30 June 2016, Council has made a material commitment to the renovation of the historicTown Hall and Institute Buildings. The anticipated project duration is expected to be from December 2016 toMarch 2018. The project budget amount is expected to approximate $12.8M.

In addition to above project, Council has aquired an alternate administration site located at 41 High St, Gawler.This was purchased for $1.7M with an estimated $200K worth of fit-out expenses.



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Town of Gawler


Note 23. Council Information & Contact Details

Principal Place of Business:89 Murray StGawler SA 5118

Contact DetailsMailing Address: Opening Hours:PO Box 130 Monday - Friday 9:00am - 5:00pmGawler SA 5118

Telephone: 08 8522 9211 Internet: www.gawler.sa.gov.auFacsimile: 08 8522 9212 Email: [email protected]

Officers Elected MembersCHIEF EXECUTIVE OFFICER MAYORHenry Inat Karen Redman

PUBLIC OFFICER COUNCILLORSname here… Ian Tooley

Kevin FischerAUDITORS Merilyn NicolsonDean Newbery & Partners Jim Vallelonga214 Melbourne Street / Adrian ShackleyPO BOX 755 Beverly GidmanNorth Adelaide SA 5006 Robin Symes

David HughesPaul Koch

Other InformationABN: 29 861 749 581



http://www.gawler.sa.gov.au/

mailto:[email protected]

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Town of Gawler


Auditor's Report - Financial Statements

This page has been left blank for insertion of the Audit Report



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Town of Gawler


Auditor's Report - Financial Statements




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Town of Gawler


Auditor's Report - Internal Controls




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Town of Gawler


Certification of Auditor Independence

To the best of our knowledge and belief, we confirm that, for the purpose of the audit of Town of Gawlerfor the year ended 30 June 2016, the Council’s Auditor, Dean Newbery & Partners has maintained itsindependence in accordance with the requirements of the Local Government Act 1999 and the Local Government (Financial Management) Regulations 2011 made under that Act

This statement is prepared in accordance with the requirements of Regulation 22(3) Local Government(Financial Management) Regulations 2011.

Henry Inat Peter BrassCHIEF EXECUTIVE OFFICER PRESIDING MEMBER, AUDIT COMMITTEE

Date:



page 51

Town of Gawler


Statement by Auditor

I confirm that, for the audit of the financial statements of Town of Gawler for the year ended 30 June2016, I have maintained my independence in accordance with the requirements of APES 110 – Code of Ethicsfor Professional Accountants, Section 290, published by the Accounting Professional and Ethical StandardsBoard, in accordance with the Local Government Act 1999 and the Local Government (Financial Management)Regulations 2011 made under that Act

This statement is prepared in accordance with the requirements of Regulation 22 (5) Local Government(Financial Management) Regulations 2011 .

Samantha AllardDean Newbery & Partners

Dated this day of 2016.



Item 7.3 – 2015/2016 Financial Performance Summary

ATTACHMENT 1 2015/2016 Financial Performance Summary

ATTACHMENT 2 2015/2016 Non Financial Indicators



TOWN OF GAWLER

FINANCIAL PERFORMANCE

SUMMARY

2015/2016

TOWN OF GAWLER

AUDIT COMMITTEE MEETING 5 OCTOBER 2016 Page 74 of 202 ATTACHMENTS UNDER SEPARATE COVER

ATTACHMENT 1

1 TOWN OF GAWLER

AUDIT COMMITTEE MEETING 5 OCTOBER 2016 Page 75 of 202


2

FINANCIAL PERFORMANCE SUMMARY

2015/2016

CONTENTS

Page

1.Executive Summary 3

1.1 Operating Result 3 1.2 Net Financial Liabilities Ratio 4

2. Operating Deficit Analysis2.1 Rates 6 2.2 Statutory Charges 8 2.3 User Charges 9 2.4 Grants, Subsidies & Contributions 10 2.5 Investment Income 12 2.6 Reimbursements 14 2.7 Other Revenue 15 2.8 Employee Costs 16 2.9 Materials, Contracts & Other Expenses 19 2.10 Depreciation, Amortisation & Impairment 24 2.11 Finance Costs 26

3. Capital Expenditure Analysis 27

4. Balance Sheet Analysis 28

5. Equity Reserves Analysis 29

6. Cashflow Statement Analysis 31

7. AppendicesAppendix 1 – Statement of Comprehensive Income 32 Appendix 2 – Balance Sheet 33 Appendix 3 – Equity Reserves 34 Appendix 4 – Cash Flow Statement 35 Appendix 5 – Financial Indicators 36 Appendix 6 – Uniform Presentation of Finances 37



3

1. EXECUTIVE SUMMARY

Although the audited financial statements disclose the financial result of the Council, they do not disclose performance against the adopted budget and/or revised forecast for the year.

Consequently, the purpose of this report is to provide a transparent analysis of the 2015/2016 financial result, and to compare such result to the adopted budget and revised forecast for the year.

Whilst there are a number of indicators that can be used to gauge the financial performance / position of the Council, the most relevant measures for a Council are the Operating Result (which discloses the annual recurrent financial performance of a Council) and the Net Financial Liabilities Ratio for the year (which discloses the overall financial position of a Council). An explanation and analysis of the result of these two key measures for 2015/16 is outlined below.

1.1 Operating Result

The recurrent operating result is the overarching key indicator of Council’s financial performance for the year – with the ideal result being that Council’s recurrent expenditure (including depreciation) is fully funded from recurrent revenue (i.e. a balanced result or minor operating surplus being achieved). From an intergenerational equity viewpoint, a recurrent operating deficit effectively means that a share of the recurrent costs of the Council is being deferred to and funded from future ratepayers.

The operating result for 2015/16 was an operating deficit of $243k, compared to an operating surplus of $1.578m for 2014/15. However, it is important to remove the anomaly between the years that was realised as a result of the Federal Government decision to provide advance payments of the 2015/16 Financial Assistance / Local Roads Grant to all Councils in late June 2015. For Gawler, the advance payment received was $755k., which was subsequently accounted for as recurrent revenue in the 2014/15 financial year.

With this anomaly removed, the underlying comparative results are an $823k surplus for 2014/15 and a $512k surplus for 2015/16. The 2015/16 underlying actual result compares to an estimated $896k surplus forecast, thereby culminating in the actual underlying surplus result being $384k less than estimated. The unfavourable variance of $384k is attributable to the following key factors:

1. A variation to forecast in asset depreciation charges of $103,000 due to the removalof residual values in compliance with Australian Accounting Standard 116 – Property,Plant and Equipment; and

2. A variation to forecast in the increase in staff annual leave entitlements liability of$120,000; and

3. A variation to forecast of $92k in the cost of water consumption (albeit noting that thevolume of water consumed reduced from 166,000kl to 153,000kl.

Council’s financial result is disclosed in Appendix 1 – Statement of Comprehensive Income. Further detailed information and analysis regarding the recurrent operating performance is disclosed in Section 2.

Purpose: To measure whether Council is generating sufficient recurrent revenue to meet its recurrent expenditure requirements (including the funding of depreciation towards the programmed replacement/renewal of fixed assets)



4

1.2 Net Financial Liabilities Ratio

Net financial liabilities equals total liabilities less financial assets (excluding equity accounted investments in Council businesses).

Often too much focus is placed on the level of a Council’s borrowings. This number has little meaning without also considering the Council’s available financial assets and other liabilities. It would make no sense for individuals, in assessing their financial positions, to look at one pile of bills and ignore others and disregard how much money they have in the bank. The same holds true for Councils.

Net financial liabilities is a broader and more appropriate measure of indebtedness than the level of borrowings, because it includes items such as employee long-service/annual leave entitlements and other amounts payable as well as taking account of a Council’s cash and investments.

It is Council policy, and the generally accepted industry view, that the ratio result not exceed 100% - i.e. that the Council’s net financial liabilities not exceed the amount of annual operating revenue.

As noted in Graph 1 below, and on the coattails of annual $3m long term fixed-interest borrowings between 2007/08 and 2010/11, Council’s ratio result incrementally deteriorated from 46% to 86%. The increase in debt between 2006/07 and 2010/11, from $7.79M to $14.67M, had a corresponding adverse effect on Council’s annual operating result via an increase in interest expense from $569K (2007/08) to $971K (2011/12).

Coinciding with the adoption of the Budget Management Policy in August 2011, the Council also fundamentally amended its loan funding strategy and treasury management practices in 2011/12. The key principal of the revised approach was that Council would budget to operate only within its financial means, in acknowledgement of the fact that the financial performance (i.e. increasing operating deficit) and financial position (i.e. increasing net financial liabilities ratio result) at the time was not financially sustainable, and that Council would only borrow external funds when its cashflow required and only after exhausting all internal funding options (thereby recognising the cheaper interest rate that applies to ‘internal’ borrowings).

Further to this, the revised approach was effectively based on future loan borrowings (if and when required) being sourced from Council accessing the variable interest rate bank overdraft facility available from the Local Government Finance Authority (which importantly can be repaid at any time as cashflow permits) as distinct from locking in to long-term fixed interest rate loans. This approach is consistent with Council’s policy position (per the Treasury Management Policy) of progressively transitioning its loan portfolio to more of a variable interest rate position.

The revised approach has subsequently resulted in no long-term fixed interest rate loans being entered into since 2010/11, with the bank overdraft facility only having to be accessed on limited occasions since then. Consequently, Council’s debt has reduced from $14.67M (as at 30 June 2011) to $8.65M (30 June 2016) and associated interest expense has reduced from $971k (2011/12) to $624k (2014/15).

This has naturally been fundamental in a dramatic turnaround in the ratio result since

Purpose: To measure the overall financial position of a Council by comparing the net amount owed to others with operating revenue.

TOWN OF GAWLER

AUDIT COMMITTEE MEETING 5 OCTOBER 2016


5

2010/11, with the ratio result being halved from 86% to 43% from 2011 to 2015. The ratio result has since marginally increased to 50% as at 30 June 2016, consistent with long term forecasts.

The material reduction in the ratio result since 2011 has provided the Council with future loan borrowing capacity, which will be progressively utilised, to fund major new investment in new and/or upgraded assets. Consequently, had the Council’s financial position not improved in recent years, then Council would not have been in a position to consider major asset investment projects such as the refurbishment and restoration of the Gawler Institute / Town Hall (which will commence in 2017) or the recent acquisition (August 2016) of the new Administration Centre. It is expected that administration staff will relocate from rented premises in High Street (Centrelink building) and the Town Hall to the new Administration Centre during December 2016.

Graph 1 – Net Financial Liabilities Ratio 2006/07 – 2015/16

46

60

7180

86

66

53 4943

50

0102030405060708090

100

% o

f Ann

ual O

pera

ting

Reve

nue

Paul M Horwood MANAGER – FINANCE & CORPORATE SERVICES

TOWN OF GAWLER



6

2. OPERATING RESULT ANALYSIS

The various Tables disclosed in this Section highlight material variances to the forecast result (being instances where the actual result is at $5,000 and 5% variance to the forecast result), by way of favourable variances shaded in green and unfavourable variances shaded in red.

2.1 RATES

Rates revenue comprises General Rates (which currently comprises 70% of total Operating revenue), Separate Rates (to fund specific expenditure), and a Waste Management Service Charge (to fund the cost of providing the kerbside waste/recycling collection service).

Late/non-payment penalty fines are also applied, in accordance with the Local Government Act 199 and Council’s Debtor Management Policy.

Council provides various rate rebates – either Mandatory (i.e. provided in accordance with State legislation) or Discretionary (i.e. provided at the discretion of Council).

The distribution of Rate revenue is levied in accordance with Council’s Strategic Rating Policy, which is reviewed on an annual basis.

Table 5 – Rates revenue 2013/2014 - 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual

2015/16 Adopted Budget

2015/16 Revised Forecast

Variance to Forecast $

Variance to Forecast % $ % Notes

RATES

General Rates 15,114,818 16,278,000 17,149,457 17,071,087 17,137,751 11,706 0% 871,457 5.4%

Net revenue after deducting rebates and remissions. Increase includes new revenue from development growth

Separate Rate - Business Development & Marketing 147,815 162,266 162,745 163,000 163,000 (255) 0% 479 0.3%

Collected on behalf of Gawler Business Development Group

Separate Rate - Natural Resources Management Levy 289,219 296,568 309,884 309,843 309,843 41 0% 13,316 4.5% Collected on behalf of State Govt

Service Charge - Waste Management 1,527,386 1,747,550 1,795,308 1,795,292 1,795,292 16 0% 47,758 2.7%Service fee 2013/14=$158, 2014/15=$175, 2015/16=$178

Late/non-payment penalty fines 87,495 79,682 83,933 90,000 90,000 (6,067) -7% 4,251 5.3% Late payment penalty fines. TOTAL 17,166,733 18,564,066 19,501,327 19,429,222 19,495,886 5,441 0% 937,261 5.0%

Actual Variance 14/15 to 15/162015/2016

General rate revenue increased by 5.4% for the year, predominantly as a result of the 3% budget increase applied and a 2.14% increase due to ‘new’ revenue from development growth.

No increase in revenue was sought from the Gawler Business Development Group for the 2015/16 financial year, hence no effective increase in the revenue collected on their behalf via application of the Business Development & Marketing Separate Rate.

Whilst total revenue received from the Waste Management Service Charge increased by 2.7% (inclusive of new revenue received from new residential development areas), the individual property fee only increased by 1.7% (from $175 to $178).

TOWN OF GAWLER



7

Graph 3 – Rates revenue 2013/2014- 2015/2016

0

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4,000,000

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16,000,000

18,000,000

20,000,000

22,000,000

2013/14 Actual 2014/15 Actual 2015/16 Actual 2015/16 Adopted Budget 2015/16 Revised Forecast



8

2.2 STATUTORY CHARGES

Statutory charges revenue is income sourced from the application of regulatory services, such as Dog Control (registration and expiation fees), Town Planning / Bldg Control (development application fees) and Parking Control (expiation fees).

The fees set for such regulatory services are predominantly determined and set by State Government regulation.

Table 6 – Statutory Charges revenue 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





STATUTORY CHARGES

Development Application Fees 241,978 274,631 269,704 245,100 260,300 9,404 4% (4,927) -1.8%

Applications rec'd: 744 (2013/14); 786 (2014/15); 777 (2015/16). Actual revenue received may vary based on nature / type of applications, not just no. of applications

Dog Registration Fees 185,267 201,487 220,330 222,012 222,012 (1,682) -1% 18,843 9.4%

Dogs registered: 5,313 (2013/14); 5,165 (2014/15); 5,335 (2015/16) - 20% increase in registration fee applied 2014/15; 4.17% increase applied 2015/16

Dog Expiation / Impounding Fees 67,551 27,913 44,362 52,000 52,000 (7,638) -15% 16,449 58.9%

Parking Expiation Fees 84,126 118,905 102,096 132,567 99,567 2,529 3% (16,809) -14.1%Expiations issued: 1,261 (2013/14); 1,548 (2014/15); 1,499 (2015/16)

Food Inspections/Audits 23,574 29,647 19,064 32,000 14,000 5,064 36% (10,583) -35.7%

Reduction in revenue due to services no longer provided to businesses outside of Council area

Property Search fees 43,288 45,542 45,208 46,000 46,000 (792) -2% (334) -0.7%

Searches processed: 834 (2013/14); 840 (2014/15); 826 (2015/16). Fees set by State Govt

Other Statutory Charges 2,142 3,233 10,570 4,500 8,207 2,363 29% 7,337 226.9%

Septic Tank application fees, Imflammable undergrowth expiations, etc. Increase in revenue due to volume of Imflammable undergrowth expiations issued

TOTAL 647,926 701,358 711,334 734,179 702,086 9,248 1% 9,976 1.4%


Overall, there was a 1.4% ($9,976) increase in revenue received from Statutory Charges during the reporting period, due to an increase in the number of registered dogs and an increase in the volume of inflammable undergrowth / dog control related expiations issued.

Such revenue increases were partly offset by reduced revenue from:

a) Development application fees (based on nominal reduction in volume ofapplications);

b) Parking expiations (based on reduction in expiations issued from 1,548 to 1,499)

c) Food inspections / audits (given staff are no longer conducting inspections oraudits outside the Council area).

Graph 4 – Statutory Charges revenue 2013/2014- 2015/2016

0

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2013/14 Actual 2014/15 Actual 2015/16 Actual 2015/16 Adopted Budget 2015/16 RevisedForecast

TOWN OF GAWLER



9

2.3 USER CHARGES

User Charges comprises fees charged for the use of Council facilities and services, such as the Sport & Community Centre, Gawler Aquatic Centre, and Willaston Cemetery.

Council also has a number of commercial properties from which it receives rent.

Table 7 – User Charges revenue 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





USER CHARGES

Cemetery Fees 98,541 129,904 158,240 118,000 148,000 10,240 7% 28,336 21.8%

Revenue includes plot lease fees and burial fees. Burials: 74 (2013/14); 79 (2014/15); 101 (2015/16)

Sport & Community Centre Fees/Sales 404,200 447,942 404,217 439,710 397,110 7,107 2% (43,725) -9.8%

Property Rents & Leases 321,835 305,547 324,696 308,509 320,262 4,434 1% 19,149 6.3%

Reduction 2014/15 due to reduced rent from Greyhound Racing SA (per Council resolution March 2014)

Swimming Pool Fees/Sales 243,895 239,427 280,958 293,000 284,000 (3,042) -1% 41,531 17.3%Increase in revenue due to combination of increased visitors and fee increases

Waste Management Services 26,836 29,752 0 30,000 0 0 (29,752) -100.0%NAWMA took over administration of additional waste bins as at 1/7/15

Visitor Information Centre Sales & Commissions 81,762 78,908 78,056 71,000 71,000 7,056 10% (852) -1.1%

Souvenir sales, brochure fees, bookings commissions. Souvenir sales $21.4k (2013/14); $16.5k (2014/15); $18.5k (2015/16)

Immunisations 21,082 15,931 16,897 24,000 24,000 (7,103) -30% 966 6.1%Vaccines provided: 3,083 (2013/14); 1,995 (2014/15); 2,035 (2015/16)

Out-of-School Hours/Vacation Care Program 183,074 5,985 175 0 0 175 (5,810) -97.1%Service transferred to Gawler Primary School in July 2014

Other User Charges 14,296 22,592 21,846 14,800 22,632 (786) -3% (746) -3.3% Other sundry fees & charges1,395,521 1,275,988 1,285,085 1,299,019 1,267,004 18,081 1% 9,097 0.7%


Overall, there was a 0.7% ($9,097) net increase in revenue generated from User Charges in 2015/16, which was predominantly attributable to an increase in Cemetery fees (as a result of an increase in burials), an increase in fees from the Gawler Aquatic Centre, and an increase in property rental income.

Such revenue increases were partly offset by reduced revenue from:

a) The Gawler Sport & Community Centre (9.8% reduction – the 2015/16 revenueeffectively mirrored revenue realised in 2013/14)

b) Waste Management Services – as a direct result of NAWMA taking over theadministration of additional waste bins (i.e. those over and above the standardbins provided for each property) from 1/7/15. With the revenue now beingreceived directly by NAWMA, the revenue loss was offset by a compensatingreduction in Waste collection and disposal costs otherwise incurred.

Graph 4 – User Charges revenue 2013/2014- 2015/2016

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TOWN OF GAWLER



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2.4 GRANTS, SUBSIDIES & CONTRIBUTIONS

Federal and State Government grants are received towards the provision of various services provided by the Council.

The funding received is either of a recurrent nature (e.g. Federal Government Financial Assistance Grant / Local Roads Grant) or is for ‘one-off’ projects as a result of successful grant applications lodged by the Council.

Some grants, such as the Federal Government Financial Assistance / Local Roads Grant are untied, although the majority are tied to a specific service or program provided by the Council (e.g. Home Assistance Scheme, Library, etc.).

Table 8 – Grants, Subsidies & Contributions 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





OPERATING GRANTS, SUBSIDIES & CONTRIBUTIONS

Federal Government Grants:'Roads to Recovery' 153,460 220,000 624,078 432,905 618,616 5,462 1% 404,078 183.7%

Financial Assistance Grant 620,011 1,760,074 603,030 1,177,940 1,172,710 (569,680) -49% (1,157,044) -65.7%

Local Roads Grant 236,195 469,839 110,755 296,524 296,524 (185,769) -63% (359,084) -76.4%Fuel Tax Rebate Scheme 11,160 11,280 13,543 11,750 11,750 1,793 15% 2,263 20.1%State Government Grants:Library Operating Grant 67,019 65,402 85,855 67,000 85,855 0 0% 20,453 31.3%Home Assistance Scheme 589,371 552,407 574,628 562,500 579,500 (4,872) -1% 22,221 4.0%'Closing the Gap' initiative 9,091 0 0 'One-off' projectSuicide Prevention Grant 5,000 0 0 'One-off' projectYouth Crime Prevention Strategy 50,000 0 0 'One-off' projectGawler Urban Arts Program 20,000 0 0 'One-off' projectVarious Youth services 12,000 3,000 0 3,000 0 0% 3,000 #DIV/0!

OSHC/Vacation Care 5,635 0 0 #DIV/0!Service transferred to Gawler Primary School in July 2014

Gawler & Surrounds Stormwater Management Grant 9,195 62,820 (215) 130,000 (20,215) 20,000 -99% (63,035) -100.3%

Project has four year life cycle. Total external funding of $230k to be received towards total project cost of $300k

Town Centre Precinct Plan 0 50,000 0 (50,000) -100.0% 'One-off' projectGawler Aquatic Centre Sunsafe project 0 0 15,000 15,000 0 0% 15,000 'One-off' projectOpen Space, Sport & Recreation Plan 0 25,000 0 (25,000) 'One-off' project

Gawler Farmers Market establishment grant 80,000 0 80,000 0 0% 80,000Immunisations provision 6,254 0 0 0 #DIV/0! Service outsourced during 2013/14Other Grants & Contributions: 0

Contributions - Developer 202,860 267,689 53,337 50,000 50,000 3,337 7% (214,352) -80.1%Carparking, Stormwater drainage, Open Space contributions, etc.

Contributions - Home Assist Clients 57,941 59,315 60,758 65,000 65,000 (4,242) -7% 1,443 2.4%Revenue received based on level of activity

Other Grants, Subsidies & Contributions 6,429 3,531 981 20,000 0 981 (2,550) -72.2%2,061,621 3,547,357 2,224,750 2,813,619 2,957,740 (732,990) -25% (1,322,607) -37.3%


In late June 2015, the Federal Govt elected to reinstate advance payments of both the Financial Assistance and Local Roads Grants. The advance payment amounted to $755k. This has the affect of increasing the 2014/15 and decreasing the 2015/16 overall result by this amount. Advance payments were not provided in June 2016.

Overall, there was a 37.3% ($1,322,607) net decrease in revenue received from operating grants, subsidies and contributions in 2015/16, which was attributable to the Federal Government decision to not continue advance payments of the Financial Assistance / Local Roads grants. In this regard, in late June 2015 Council received advance payments of $755k brought forward from the 2015/16 grant allocation, which was subsequently accounted for as revenue in the 2014/15 financial year. With the advance payments no longer continued in 2015/16, this has had the immediate affect of distorting the overall financial performance of Councils for the 2014/15 and 2015/16 financial years, such that for meaningful comparisons to be drawn between the years the impact of the advance payments needs to be discounted and removed.

There was also a reduction in the amount of Developer contributions received, however this was offset by additional ‘Roads to Recovery’ grant payments received.

TOWN OF GAWLER



11

Council continues to be proactive in sourcing external grant funds to assist in the delivery of recurrent services and/or the provision of new community facilities/projects, via the External Funds Committee.

Graph 5 – Grants, Subsidies & Contributions 2013/2014- 2015/2016

0

500,000

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1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000


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2.5 INVESTMENT INCOME

Investment income (interest received) is derived from the following: • Various investments that Council initiates during periods of favourable cash

inflows;• The interest component of loan repayments received from various community

groups;• Interest received on funds effectively held in trust (with the interest earned on

such funds re-invested in the associated fund)

Table 9 – Investment Income 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





INVESTMENT INCOME

Interest Received - LGFA/Bank 107,169 97,947 48,359 63,000 51,000 (2,641) -5% (49,588) -50.6%

Revenue received based on cashflow. Interest rates have periodically reduced in recent years. Ongoing reduction in revenue expected due to planned utilisation of internal cash reserves, consistent with Treasury Management Policy

Interest Received - Developer Contributions 48,104 38,313 31,493 33,000 33,000 (1,507) -5% (6,820) -17.8%

Interest on contributions received November 2011. Funds received, plus interest, allocated to Property Equity Reserve Fund. Interest rates have periodically reduced in recent years

Interest Received - Community Loans 5,553 4,456 3,317 2,917 2,917 400 14% (1,139) -25.6%Revenue determined by associated loan repayment schedules

160,826 140,716 83,169 98,917 86,917 (3,748) -4% (57,547) -40.9%


Consistent with Council’s longer term projections, an ongoing decrease was experienced in investment income for the reporting period.

This is attributable to the deliberate (and appropriate) treasury management approach of utilising Council’s own internal cash resources to part fund the annual capital works program (prior to any consideration of external loan borrowings being utilised for such purpose). This approach, consistent with Council’s Treasury Management Policy, has had the immediate flow on effect of materially reducing Council’s interest costs in recent years, given no loan term loan borrowings have been instigated since the 2010/11 financial year.

Council’s Long Term Financial Plan forecasts that investment income will cease to be derived in coming years, as Council transitions to a reliance on its overdraft facilities to part fund major capital works programs in the next few years. This short-term, variable-interest rate, loan borrowing approach is appropriate (as distinct from long-term fixed-interest rate loan borrowings) as the overdraft facility can be repaid at any time as cashflow permits.

The only risk with this approach is that the interest rate applied against the overdraft balance is subject to variation in line with periodic movements in interest rates – albeit it should be noted that interest rates have remained relatively stable for some considerable time (outside of infrequent interest rate cuts). To minimise such risk, should interest rates rapidly materially increase in the future, then Council would need to consider transferring a component of its overdraft balance to a fixed-interest long-term loan borrowing facility (which have a set predetermined value of principal and interest repayments over the life of the loan).

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Graph 6 – Investment Income 2013/2014- 2015/2016

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2.6 REIMBURSEMENTS

Includes the reimbursements of various costs, such as legal costs (e.g. Debt recovery related) and insurance claimable expenses.

Subsequently, the amount of revenue received may fluctuate dramatically from year to year based on the level of associated expenditure incurred.

Table 10 – Reimbursements revenue 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





REIMBURSEMENTS

Employee vehicle contributions 43,904 55,930 72,581 65,500 74,923 (2,342) -3% 16,651 29.8%Other Councils 9,165 14,240 14,896 10,000 10,000 4,896 49% 656 4.6%

LGA Workers Compensation Scheme 92,074 139,883 147,470 150,000 150,000 (2,530) -2% 7,587 5.4%

Performance rebate received. Increase in rebate based on improved claims history and WHS initiatives implemented

Insurance Claims 26,098 50,149 59,972 0 38,850 21,122 54% 9,823 19.6%Revenue received will fluctuate based on number/nature of insurance claims

Other 194,511 88,355 157,804 96,291 143,520 14,284 10% 69,449 78.6% Other sundry reimbursements365,752 348,557 452,723 321,791 417,293 35,430 8% 104,166 29.9%


Overall, there was a 29.9% ($104,166) increase in reimbursements during the reporting period. This was predominantly attributable to an increase in the recovery of legal costs incurred relating to debt recovery ($20k) and the establishment of various land management agreements with devlopers ($60k), and an increase in vehicle contributions received from employees ($17k).

Graph 7 – Reimbursements revenue 2013/2014- 2015/2016

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2.7 OTHER REVENUE

Includes donations, commissions and other sundry revenue received.

Table 11 – Other Revenue 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





OTHER REVENUE

Donations 2,355 3,434 1,755 1,700 750 1,005 134% (1,679) -48.9%Friends of Gawler Library and other minor sundry donations

Sundry revenue - Town Planning 12,044 5,104 4,163 3,100 3,100 1,063 34% (941) -18.4%

Evanston Gardens - Developer Funded DPA 0 0 32,000 40,000 32,000 0 0% 32,000 #DIV/0!Commission 4,007 2,753 3,768 4,100 4,100 (332) -8% 1,015 36.9% Commission on various sales

Other Income 34,941 6,959 10,695 2,500 5,765 4,930 86% 3,736 53.7%Other sundry revenue: 2013/14 incl $20k LGA Risk Management Award

53,347 18,250 52,381 51,400 45,715 6,666 15% 34,131 187.0%


Overall, there was a 187% ($34k) increase in Other Revenue for the reporting period.

This was solely attributable to revenue received relating to the developer-funded Evanston Gardens DPA.

Graph 8 – Other Revenue 2013/2014- 2015/2016

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2.8 EMPLOYEE COSTS

Includes salaries/wages and other indirect costs (e.g. superannuation, workers compensation insurance, etc.) associated with the employment of Council staff.

Table 12 – Employee Costs 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





EMPLOYEE COSTS

Wages 1,273,680 1,256,408 1,262,084 1,562,155 1,282,374 (20,290) -2% 5,676 0.5% Positions vacant filled by Agency staff

Salaries 5,690,204 6,440,954 6,843,806 6,421,198 6,668,536 175,270 3% 402,852 6.3%

Variance due to reduced leave entitlements taken during 2015/16 (average Annual leave taken per employee = 2013/14 (143hrs), 2014/15 (103hrs), 2015/16 (109) and new positions approved by Council during the year

Redundancy Payments 174,471 0 0 0 0 0 0Superannuation 652,090 700,364 774,550 795,782 727,792 46,758 6% 74,186 10.6%Income Protection Insurance 79,817 79,536 99,943 94,658 90,709 9,234 10% 20,407 25.7%Workers Compensation Insurance 340,513 371,997 427,617 389,830 385,603 42,014 11% 55,620 15.0%

8,210,775 8,849,259 9,408,000 9,263,623 9,155,014 252,986 3% 558,741 6.3%

FTE Count (including positions vacant) 104 107 116


Increase due to new positions approved by Council during the year

Overall, there was a 6.3% ($559k) increase in Employee Costs during the reporting period due to nine new positions created, hence Council’s full-time equivalent staff complement increasing from 107 to 116.

All of the new positions created were endorsed by Council and included:

(a) Permanent positions:

• Building Officer (1.0FTE) – a report recommending the creation of this newposition was tabled to Council in August 2015. The requirement for the positionemanated from increased building activity and increases in legislative compliancematters;

• Senior Development and Environmental Engineer (1.0FTE) – this new positionrelates to the additional FTE provided for within the adopted budget and Council’

In response to an expected increase in staffing demands as a direct result of development and population growth experienced, Council has previously provided for a nominal increase in staff numbers within each year of its Long Term Financial Plan, without necessarily specifying to which roles the additional staffing provision related to.

During the 2015/16 financial year, a Workforce Plan 2016-2019 was developed, which now provides a greater level of detail relative to future identified staffing needs.

(b) Short-term Contract positions:

From time to time, additional short-term contract roles are created in direct response toorganisational and / or legislative requirements. These positions occur within theendorsed budget provisions. In this regard, during the reporting period, the followingcontract positions were created:

• General Inspector (Parking control) (1.0FTE contract position to March 2017) –this new staffing (contract) position was previously funded under the ‘Contracts &Materials’ budget, and was created on the basis of the new position being fundedfrom additional parking expiations issued;

• Property Divestment Strategy Officer (3 year contract position) – this position wasinitially provided for in the 2015/16 budget under the ‘Contract & Materials’budget. The expectation is that this short-term position will be funded from the

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proceeds of surplus property assets sold (whilst investigations in this regard had commenced, no actual properties were sold during the reporting period);

• Land Use Policy Officer (1.0FTE contract position to October 2016) – a reportrecommending the creation of this new position was tabled to Council in August2015. This role was part funded from $30,000 received towards the developerfunded Evanston Gardens DPA. The requirement for the position emanated fromthe need to have an increased focus in strategic land use planning andcommunity policy development, in response to the considerable challengespresented to Council as a result of rapid population and development growth;

• Planning Officer (1.0FTE contract position to June 2017) - this position wasrequired to provide short-term capacity within the Development Assessment teamas a result of staff resources required towards the Efficiency & EffectivenessReview undertaken. This position also provided back fill as a consequence of thevacant Team Leader (Development Assessment) role.

• 2 traineeships (Building / Records Management). During the year, the StateGovernment announced a $2m fund to support the employment of trainees inregional Councils. Council was subsequently successful in applying for 2trainees, who will complete a two year traineeship. Council will receive subsidyfunding from the State Government of $58,000 across the two years;

• Senior Projects Manager (1.0FTE contract position to November 2017) – thisposition was created to project manage the delivery of key capital works projects,including the rehabilitation of the Gawler Mill Bridge and the upgrade of MurrayStreet, Gawler (Stage 6), the cost of which are provided within the project budget.

Increases in indirect costs, such as superannuation, workers compensation and income protection insurance, etc. were similarly affected.

Employee costs were adversely affected by a $120k increase in Annual Leave entitlements liability (above the $150k forecast provision), based on the amount of leave taken during the reporting period being less than anticipated. In some instances, leave taken by staff that would otherwise have been taken as annual leave was attributed as time-off in lieu (TOIL), to reduce the value of accrued TOIL liability. To mitigate any further such instances of this, excessive TOIL hours accrued were paid out to staff in May 2016, which coincided with Management implementing additional measures to manage and minimise future TOIL accruals.

Further to this, added administrative measures have been implemented towards reducing the level of Annual Leave entitlements liability, and it is expected that these measures will culminate in the value of the liability being reduced to an appropriate level.

The review of Depot operations continued during the reporting period, with efficiencies realised culminating in staff being able to in-source $260k of capital works traditionally provided by external contractors.

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Graph 9 – Employee Costs 2013/2014- 2015/2016

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2.9 MATERIALS, CONTRACTS & OTHER EXPENSES

Includes payments for the external provision of services (i.e. consultants and contractual services), payments for physical fuel/energy and materials, and other payments such as insurance, postage, telephone and contributions/donations.

Table 13 – Materials, Contracts & Other expenses 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





MATERIALS, CONTRACTUAL SERVICES, OTHER

(a) Recurrent Costs

Contractors - ConsultantsBuilding Assessment 30,073 11,868 15,260 10,000 13,603 1,657 12% 3,392 28.6%

Human Resources 29,199 39,458 59,294 80,000 80,000 (20,706) -26% 19,836 50.3%

Incl. HR services provided by Barossa Council as part of Resource Sharing agreement; Industrial relations advice, etc. 2015/16 includes $10k for advice regarding Enterprise Bargaining Agreement review

Fleet Management 16,437 25,934 26,801 17,000 26,802 (1) 0% 867 3.3%Heritage 39,285 27,716 38,438 20,000 27,788 10,650 38% 10,722 38.7%Town Planning Projects 27,261 13,995 18,601 25,000 25,000 (6,399) -26% 4,606 32.9%Significant Trees Assessment 10,855 9,172 5,305 5,000 5,000 305 6% (3,867) -42.2%

Other Consultants 151,155 154,503 199,474 273,575 147,144 52,330 36% 44,971 29.1%

Variance to forecast due to various engagements - incl. Economic snapshot of Gawler, independent review of options regarding Gawler Connect/new Admin Centre, etc.

Contractors - Employment Agency StaffSport & Community Centre 55,613 55,165 58,195 70,000 50,000 8,195 16% 3,030 5.5%Swimming Pool 273,014 247,887 195,706 251,000 197,500 (1,794) -1% (52,181) -21.1%

Depot 191,912 219,584 109,395 17,000 26,768 82,627 309% (110,189) -50.2%

Requirement for external agency staff determined by staff resignations, leave, etc.

Out-of-School Hours / Vacation Care Program 50,828 1,589 0 0 0 0 (1,589) -100.0%

Program transferred to Gawler Primary School early July 2014

Other Services 47,021 60,304 704 2,500 0 704 #DIV/0! (59,600) -98.8% Various relief staff

Contractors - Operating Lease/LicencesHeritage Collection storage - Lease fees 2,474 2,621 2,621 2,750 2,750 (129) -5% (0) 0.0%Computer Hardware - Lease fees 158,837 159,739 154,440 207,167 187,167 (32,727) -17% (5,299) -3.3%Computer software - Licence fees 315,306 280,101 340,967 366,016 354,901 (13,934) -4% 60,866 21.7%Other Leases & Licences 10,368 13,714 6,563 12,550 4,750 1,813 38% (7,151) -52.1%

Contractors - Other

Waste Management - Collection/Disposal 1,634,257 1,743,547 1,839,605 1,876,936 1,849,236 (9,631) -1% 96,058 5.5%NAWMA. On-going expansion of services into new development areas

External Auditor 17,300 18,200 18,900 27,800 18,900 0 0% 700 3.8% Dean Newbery & Partners

Payment Collection agents 12,964 12,963 14,307 19,200 15,000 (693) -5% 1,344 10.4%B-Pay, Aust Post - cost incurred based on client transaction volume

Home Assistance Scheme 215,389 203,458 216,665 221,282 221,282 (4,617) -2% 13,207 6.5%Client services - funded from Govt subsidy funds

Street Cleaning 114,192 112,606 144,856 110,468 111,053 33,803 30% 32,250 28.6%

Periodic cleaning of CBD, urban streets and carparks. Variance includes additional sweeping due to storm damage and high-pressure clean of Murray street footpaths

Plant Servicing & Repairs 111,392 84,689 149,544 119,815 125,815 23,729 19% 64,855 76.6%

Variance due to ageing fleet and refurbishment of 2 trucks to extend useful life

Roads - Linemarking 42,545 67,891 46,290 50,000 50,000 (3,710) -7% (21,601) -31.8% Programmed linemarking of sealed roadsRoads - Kerb & Footpath repairs 98,427 95,383 76,287 100,000 68,000 8,287 12% (19,096) -20.0%Roads - Road seal repairs 33,076 0 21,078 25,000 25,000 (3,922) -16% 21,078Stormwater drainage 56,324 38,575 74,748 60,600 70,600 4,148 6% 36,173 93.8% Cleaning of pipes/pits/drains

Weedspraying 44,441 50,593 55,563 47,280 45,134 10,429 23% 4,970 9.8%Spraying of ovals, parks, footpaths, road reserves, etc

Park/Street tree maintenance 5,467 1,840 8,990 9,000 7,600 1,390 18% 7,150 388.6% Tree trimming, removal etc.

Buildings - Cleaning services 197,396 193,531 215,583 210,200 210,100 5,483 3% 22,052 11.4%Increase due to increase in service level for Gawler Sports & Community Centre

Buildings - Security services 56,272 61,358 68,941 59,050 68,038 903 1% 7,583 12.4% Security monitoring servicesBuildings - Fire equipment service/replacement 24,001 26,663 33,927 28,875 20,612 13,315 65% 7,264 27.2% Programmed servicing & replacementBuildings - Pest control services 3,337 4,491 7,575 5,306 5,306 2,269 43% 3,084 68.7%

Buildings - Air-conditioning maint. & repairs 18,353 18,251 17,632 15,253 12,653 4,979 39% (619) -3.4%

Buildings - Asbestos surveys & removals 5,680 0 2,770 0 0 2,770 #DIV/0! 2,770

Buildings - Electrical repairs 49,826 52,898 70,440 46,500 58,706 11,734 20% 17,542 33.2%

Various electrical repairs and minor improvements across Council sites. Variance includes $16k for installation of power supply for Gawler Farmers Market

Buildings - Plumbing repairs 17,899 50,149 23,569 27,000 18,291 5,278 29% (26,580) -53.0%Buildings - Guttering replacement 21,554 740 13,094 17,225 10,521 2,573 24% 12,354 1669.5%Buildings - Other Maintenance & repairs 50,608 85,960 64,228 48,890 44,348 19,880 45% (21,732) -25.3%Internet expenses 1,961 4,586 15,399 15,652 15,652 (253) -2% 10,813 235.8%

Testing/tagging of electrical equipment 168 0 8,254 0 0 8,254 #DIV/0! 8,254

Periodic testing/tagging of all electrical devices. All devices due to be tested every 2-5 years

Independent Members fees 14,028 13,026 24,846 25,100 25,100 (254) -1% 11,821 90.7%

Audit Committee, Development Assessment Panel. Additional expense 2015/16 due to review of DAP fees

Couriers/Freight charges 11,727 11,534 11,710 12,150 13,150 (1,440) -11% 177 1.5%

Banking services 52,747 60,256 66,043 68,648 68,648 (2,605) -4% 5,787 9.6%

Cost increases partly attributable to increase in transactional volume as a result of growth

Property valuations 42,638 42,952 40,091 45,000 40,100 (9) 0% (2,861) -6.7%Valuations provided by Valuer-General for rating purposes

Printing - Community Newsletters 1,679 545 1,627 0 7,000 (5,373) -77% 1,082 198.3%Printing - Rate Notices 10,961 10,009 9,006 11,300 11,300 (2,294) -20% (1,003) -10.0%


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2013/14 Actual

2014/15 Actual

2015/16 Actual





Printing - Other 22,253 14,072 25,101 27,200 21,950 3,151 14% 11,029 78.4%

Expiation forms, receipt books, payslips, dog registration renewals, etc. 2015/16 incl. $10k for 7000 Gawler Visitor brochures

Property rent 101,752 113,074 115,357 115,000 115,000 357 0% 2,283 2.0% High Street office

Lands Title Office reports 3,126 2,224 3,095 3,200 3,200 (105) -3% 871 39.1%Copies of property titles, property ownership transfer advices

Grants Submission Writer 31,962 26,280 39,330 60,000 35,000 4,330 12% 13,050 49.7%Professional grants writing / research service

External Plant Hire 116,896 137,571 129,116 62,400 102,964 26,152 25% (8,455) -6.1%Hire of external equipment for various activities

Parking Control Inspector 88,921 50,666 4,349 10,000 2,100 2,249 107% (46,317) -91.4%Reduction in expense due to new staffing position created

Murray Street banners installs 29,092 15,370 22,690 15,450 15,450 7,240 47% 7,320 47.6%Immunisation Services 35,448 21,147 24,529 47,000 47,000 (22,471) -48% 3,382 16.0% Service contracted out during 2013/14Milne Road wood weed control 26,500 27,416 30,000 28,000 (584) -2% 916 3.5%After Hours Telecommunication Service 12,865 12,333 15,570 14,500 14,500 1,070 7% 3,237 26.2%Gawler Activation Program 0 14,515 36,965 40,000 40,000 (3,035) -8% 22,450 154.7% New Initiative #19

Other Contractual services 311,340 306,182 354,667 225,074 285,800 68,867 24% 48,485 15.8%

Increased expense due to increased corella control ($18k) and storm damage repairs ($25k) etc.

Materials - EnergyFuel 153,288 141,161 117,840 135,037 127,416 (9,576) -8% (23,321) -16.5%

Gas 69,333 62,194 37,953 39,994 39,994 (2,041) -5% (24,241) -39.0%Reduced expense due to installation of new gas heater at Gawler Aquatic Centre

Water 406,220 563,478 524,111 431,413 431,701 92,410 21% (39,367) -7.0%

Total water consumed 2013/14 = 117,000kl, 2014/15 = 166,000kl, 2015/16 = 153,000kl. Usage subject to fluctuation based on climatic demand

Electricity - Streetlighting 378,321 378,752 395,417 391,013 391,013 4,404 1% 16,665 4.4%

Electricity - Other 210,175 186,332 170,927 249,846 237,517 (66,590) -28% (15,405) -8.3%

Reduced expense due to modification to Multi-Level Car Park lighting and installation of new and more efficient pumping equipment at the Gawler Aquatic Centre

Materials - Road makingBitumen 18,715 33,525 31,663 42,000 36,000 (4,337) -12% (1,862) -5.6%

Concrete 15,605 19,961 36,620 22,000 32,000 4,620 14% 16,659 83.5%Additional kerb repairs undertaken during 2015/16

Rubble 45,652 63,541 61,803 50,000 50,000 11,803 24% (1,738) -2.7%Footpath maintenance, road and road shoulders grading

Materials - OtherPark/Street trees 13,028 16,732 18,147 15,500 15,500 2,647 17% 1,415 8.5% Purchase of new/replacement trees

Fertiliser/Weed control 43,534 31,504 25,592 41,600 31,600 (6,008) -19% (5,912) -18.8%Fertiliser, loam and weed control materials used in maintaining Ovals/Parks/Gardens.

Out-of-School-Hours / Vacation Care Program 10,517 0 0 0 0 0 0

Program transferred to Gawler Primary School early July 2014

Minor asset purchases 68,154 99,897 63,558 44,600 59,314 4,244 7% (36,339) -36.4%Minor assets purchased (less than asset capitalisation value)

Murray Street banners 13,307 2,796 13,094 1,800 9,300 3,794 41% 10,298 368.3%Manufacture of new and/or replacement banners

Road/Traffic control signs 24,185 28,276 50,413 23,650 34,501 15,912 46% 22,137 78.3%New/replacement signs installed in accordance with traffic standards

First Aid/safety supplies 6,064 8,110 5,132 8,700 7,200 (2,068) -29% (2,978) -36.7% Periodic restock of First aid equipment

Canteen supplies 79,832 68,051 68,331 86,000 65,000 3,331 5% 280 0.4%Swimming Pool, Sport & Community Centre

Swimming Pool chemicals 25,338 29,460 16,190 24,000 17,000 (810) -5% (13,270) -45.0%

Reduced expense due to operational improvements at the Gawler Aquatic Centre

Vehicle/Machine parts 57,445 59,708 51,579 72,000 54,500 (2,921) -5% (8,129) -13.6%Stationery 46,818 48,737 39,840 45,500 45,500 (5,660) -12% (8,897) -18.3%Immunisation vaccines 0 3,156 0 0 0 0 (3,156) -100.0% Service contracted out during 2013/14Depot store supplies 17,859 20,916 22,159 15,000 15,000 7,159 48% 1,243 5.9% Minor hardware, loose tools

Library materials 5,594 8,548 20,386 10,300 29,155 (8,769) -30% 11,838 138.5%Increased expense funded from increase in associated subsidy

Catering 34,017 39,479 39,596 30,820 30,117 9,479 31% 117 0.3%

Catering costs for numerous meetings, workshops, forums, Christmas function, etc.

Uniforms/Corporate wardrobe 24,308 43,291 44,483 37,950 37,750 6,733 18% 1,192 2.8%Where individual employee allowance is exceeded, cost is recovered

Other sundry materials 244,593 184,592 185,713 162,315 229,223 (43,510) -19% 1,121 0.6%

Other - InsuranceBldg & Contents, Plant & Equipment 145,248 148,584 152,480 149,191 152,480 0 0% 3,896 2.6%Public Liability 85,176 86,556 88,767 88,919 88,327 440 0% 2,211 2.6%Provision for excess on claims

4,731 5,455 3,250 6,000 6,000 (2,750) -46% (2,205) -40.4% Annual cost based on volume of claimsOther insurances 10,360 9,806 14,453 11,282 13,311 1,142 9% 4,647 47.4%

Other - Communications

Advertising - Recruitment 15,859 15,349 8,779 15,000 7,000 1,779 25% (6,570) -42.8%Annual cost based on staff turnover: 10% (13/14); 9% (14/15); 7% (15/16)

Advertising - Marketing & Promotion 3,105 8,942 9,695 5,500 5,500 4,195 76% 753 8.4%

Advertising - Other 24,580 34,730 48,918 27,180 34,010 14,908 44% 14,188 40.9%

Community events, Public consultations, Statutory advertisements, etc. Increase due to additional public consultation required during the year

Postage 36,982 38,236 45,673 41,900 46,150 (477) -1% 7,437 19.5%Postage rates increased from 1 January 2016

Telephone 101,309 120,226 111,995 119,130 108,930 3,065 3% (8,231) -6.8%

Landlines, Mobile phones, Data usage plans, etc. Reduction in expense due to review of phone plans (incl. pooling of data plans)

Other - Staff Training & RecruitmentStaff training 118,894 97,059 106,428 120,000 112,000 (5,572) -5% 9,369 9.7%Police Clearance Checks / Pre-employment Medical assessments / Random Drug & Alcohol testing 3,678 6,596 16,571 5,300 16,300 271 2% 9,975 151.2%

Annual expense based on staff turnover. 2015/16 includes introduction of random Drug & Alcohol testing

Study assistance payments 230 1,461 3,038 3,000 3,000 38 1% 1,578 108.0%

Other - Rates, Taxes, Statutory Expenses

Fringe Benefits Tax 56,910 73,781 118,451 72,000 97,000 21,451 22% 44,670 60.5%

Increase due to variations between business/private use and change in no. of days available for certain vehicles from previous year

Emergency Services Levy 10,967 17,710 19,338 18,351 18,351 987 5% 1,628 9.2%




21

2013/14 Actual

2014/15 Actual

2015/16 Actual





State Govt NRM Levy 288,499 296,805 309,843 309,843 309,843 0 0% 13,038 4.4%Payment of funds collected on behalf of State Govt

Vehicle registration fees 32,296 34,950 43,060 40,560 40,560 2,500 6% 8,110 23.2%Increase includes new Lifetime Support Fund fee applied

Elected Member allowances 219,144 224,260 218,775 231,000 218,275 500 0% (5,485) -2.4%Reduction due to vacant position on Council

Other - Contributions & Donations

Gawler Business Development Group Inc. 148,000 163,000 163,000 163,000 163,000 0 0% 0 0.0%Payment of funds collected from Separate Rate levied

Gawler Community House 10,000 10,000 10,000 10,000 10,000 0 0% 0 0.0%

Christmas Festival 18,271 25,000 210 26,000 210 0 0% (24,790) -99.2%Event cancelled in 2015 due to extreme heat

Dog & Cat Management Board 37,053 40,297 44,066 40,800 40,800 3,266 8% 3,769 9.4% Based on 20% of dog fees receivedRegional Development Aust Barossa Inc. 35,000 36,015 36,411 37,100 37,100 (689) -2% 396 1.1%Heritage Grants 6,000 1,320 6,000 40,000 13,000 (7,000) -54% 4,680 354.5%Social Support (Gawler Health Service) 50,000 51,125 51,125 52,530 52,530 (1,405) -3% 0 0.0% Funded from HACC funding receivedCommunity Grants Scheme 24,996 14,061 20,855 25,000 25,000 (4,145) -17% 6,794 48.3%

Northern Volunteering 12,475 10,695 13,600 13,600 (2,905) -21% (1,780) -14.3%Volunteer Resource Centre service outsourced to Northern Volunteering

Indigenous Land Use Agreement 2,764 0 2,936 0 0 (2,764) -100.0%

Other contributions & donations (cash) 28,506 13,120 46,594 46,060 57,260 (10,666) -19% 33,474 255.1%2015/16 incl full-year contribution to regional procurement group

Other contributions & donations (in-kind) 164,473 230,102 178,763 145,500 170,642 8,121 5% (51,339) -22.3%Value of in-kind community donations (i.e. free or reduced rent of Council facilities)

Other - Other Expenses

Legal fees - Debt collection 41,931 21,466 32,956 57,927 26,927 6,029 22% 11,490 53.5% Costs recovered from associated debtors

Legal fees - Town Planning 179,607 133,354 102,305 110,000 114,251 (11,946) -10% (31,049) -23.3%Annual expense based on level/nature of planning appeals, etc

Legal fees - Industrial relations 4,963 3,700 19,839 6,000 2,000 17,839 892% 16,139 436.2%Legal fees - Other 55,159 31,250 43,493 46,950 25,500 17,993 71% 12,243 39.2%Memberships - Gawler River Flood Management Authority 11,902 12,200 12,566 12,566 12,566 0 0% 366 3.0%Memberships - Local Government associations 40,264 41,529 30,820 41,650 31,198 (378) -1% (10,709) -25.8%

Reduction due to Wakefield Region Group now defunct

Memberships - Other 15,408 25,375 21,310 22,705 22,312 (1,002) -4% (4,065) -16.0%Increase 2014/15 includes $5k National Trust partnership

Electoral roll updates 5,813 6,052 6,413 6,000 6,000 413 7% 361 6.0%Visitor Information Centre - purchase of commissionable items, souvenirs 73,234 64,422 64,346 56,000 56,000 8,346 15% (76) -0.1%

Other expenses 61,647 75,269 61,901 273,180 227,604 (165,703) -73% (13,368) -17.8%Variance to forecast due to unspent Sundry Projects Fund

TOTAL RECURRENT COSTS 9,311,998 9,506,575 9,715,246 9,793,610 9,508,120 207,126 2% 208,671 2.2%

(b) Non-Recurrent Costs

Community Services:Home Assistance Scheme - Website portal & program video 31,498 0 0 0 0 0 0 Funded from Government grantYouth Crime Prevention Strategy 48,000 0 0 0 0 0 0Regional Health Plan 12,728 4,320 10,066 5,000 8,386 1,680 20% 5,746 133.0%Cemetery Management Plan 0 8,000 0 0 0 0 (8,000) -100.0%Emergency Management Plan 0 7,500 7,500 0 0 7,500 0 0.0%Social Infrastructure Needs Assessment & 0 14,243 20,801 20,000 20,000 801 4% 6,558 46.0%Carpark Strategy 0 0 11,490 20,000 20,000 (8,510) -43% 11,490 New Initiative #182Prepare Accessability Action Plan 0 0 5,050 15,000 15,000 (9,950) -66% 5,050 New Initiative #144Youth Capacity Building 0 0 2,409 10,000 10,000 (7,591) -76% 2,409 New Initiative #139

Community Magazine 0 0 0 15,000 0 0 0 New Initiative #498Mayor's Young Womens' Leadership Program 0 0 1,818 3,000 0 1,818 1,818 New Initiative #618

Culture:Gawler Urban Arts Program 28,063 0 0 0 0 0 0Gawler 175th Celebration 8,325 1,674 0 0 0 0 (1,674) -100.0%Heritage Collection conservation works / implementation of Heritage Management 1,818 10,485 18,851 30,000 30,000 (11,149) -37% 8,366 79.8% New Initiative #197Art & Cultural Strategy 0 5,858 21,674 25,000 25,000 (3,326) -13% 15,816 270.0%Library Strategic Plan 0 25,430 6,341 5,000 13,850 (7,509) -54% (19,089) -75.1% New Initiative #175Gawler Art Award 0 2,500 0 0 0 0 (2,500) -100.0% Bi-ennial awardEarly Literacy & Outreach Services 0 0 0 10,000 10,000 (10,000) -100% 0 New Initiative #170

'Closing the Gap' Initiative 0 0 3,002 10,000 10,000 (6,998) -70% 3,002 New Initiative #145

Economic Development:Economic Development Strategy 3,000 2,000 0 0 0 0 (2,000) -100.0%

Rural Land Use & Infrastructure investigation 24,000 0 20,000 0 0 (24,000) -100.0%Town Character DPA 30,282 14,866 20,000 15,000 (134) -1% (15,416) -50.9%Gawler East Structure Plan 35,027 2,370 0 0 2,370 (32,657) -93.2%

Town Centre Precinct Plan 0 68,666 42,825 0 40,000 2,825 7% (25,841) -37.6%

Town Centre Refurbishment Grant 0 10,000 0 10,000 0 0 (10,000) -100.0%

Funding provided to Gawler Business Development Group as part of Hero Bldg Project

Gawler Farmers Market establishment grant 0 0 80,000 0 80,000 0 100% 80,000 Funded from State Government grant

Environment:Flood Safe Program 5,930 5,000 0 0 0 0 (5,000) -100.0%Asbestos Register 1,750 0 0 0 0 0 0Gawler & Surrounds Stormwater Management Plan 9,195 61,020 83,989 200,000 100,000 (16,011) -16% 22,969 37.6% Multi-year projectEnvironmental Management Plan 8,280 4,710 0 4,329 381 9% (3,570) -43.1%Emissions Register Auditing 425 8,000 0 425 425

Recreation:

BMX Championships Grant 6,000 0 0 0 0 0 0Open Space, Sport & Recreation Plan 45,452 2,000 0 0 2,000 (43,452) -95.6%Gawler Aquatic Centre Asset Management Plan 0 23,914 8,925 0 30,000 (21,075) -70% (14,989) -62.7%

Gawler Greyhound development contribution 0 52,000 0 0 0 0 (52,000) -100.0%Accrued expense as at 30/6/15 (contribution not yet paid)

Clonlea Reserve Basketball Ring 3,524 2,500 2,500 1,024 41% 3,524 New Initiative #530Update Walking & Cycling Strategy 0 0 0 40,000 0 0 0 New Initiative #219


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2013/14 Actual

2014/15 Actual

2015/16 Actual





Regulatory Services:Dog Doorknock Survey 32,728 0 0 40,000 0 0 0

Council Administration/Other:

Business Continuity Plan 6,500 13,500 0 0 0 0 (13,500) -100.0%Funded from LGA Mutual Liability Scheme contribution

Periodical Representation Review 9,679 0 0 0 0 0 0

Provision for Doubtful Debts 74,652 (611) 0 0 0 0 611 -100.0%Community Plan 8,645 8,126 0 0 0 0 (8,126) -100.0%Traffic & Transport Management Plan 25,970 60,584 19,503 0 23,408 (3,905) -17% (41,081) -67.8%Depot Review implementation 52,063 34,125 35,000 30,625 3,500 11% (17,938) -34.5%Asset Management Plan / Asset Revaluations 3,800 46,563 7,000 35,038 11,525 33% 42,763 1125.3%

Council elections 0 63,775 0 0 0 0 (63,775) -100.0% Periodic election held every 4 yearsOrganisational Cultural Survey 0 21,416 0 0 0 0 (21,416) -100.0%Organisational Diagnostics - Effectiveness & Efficiency Review 0 0 62,024 75,000 35,000 27,024 77% 62,024 New Initiative #476Review Interpretive Signage 0 0 3,967 50,000 5,000 (1,033) -21% 3,967 New Initiative #258

TOTAL NON-RECURRENT COSTS 314,481 668,304 518,818 675,500 563,136 (45,998) -8% (149,486) -22.4%

TOTAL MATERIALS, CONTRACTUAL SERVICES & OTHER EXPENSES 9,626,479 10,174,879 10,234,064 10,469,110 10,071,256 161,128 2% 59,185 0.6%


Overall, there was a 0.6% ($59,185) increase in Materials, Contracts & Other expenses for the reporting period. However, with the exclusion of non-recurrent costs, there was a 2.2% ($208,671) increase in recurrent costs.

Key factors impacting on this increase include:

• Unfavourable increase

o $96k – increase in waste collection & disposal costs (partly due toincreased services to new residential development areas)

o $65k – additional vehicle/plant servicing and repairs (partly due to ageingfleet)

o $61k – additional software licence fees (partly due to biennial paymentsmade in 2015/16 (incl. $9k for aerial photography), new fees incurred (e.g.for Council dashboard - $7.8k) and fee increases for existing software)

o $45k – additional Fringe Benefits Tax expense

o $36k – additional stormwater drainage maintenance

o $33k – additional contributions and donations ($15k of which is due to2015/16 including a full-year contribution to the Barossa RegionalProcurement Group whereas 2014/15 contribution was only part-yearcontribution)

• Favourable reduction

o $266k - reduction in engagement of Employment agency staff andcontracted General Inspector (this was primarily due to staffing positionsbeing filled, leading to increase in Employee Costs – refer Section 2.8above)

o $39k – reduction in water costs (water consumption reduced from166,000 kl to 153,000kl)

o $36k – reduction in purchase of minor plant and equipment

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o $25k – reduction due to cancellation of the Christmas Festival (as a resultof extreme heat)

o $24k – reduction in gas consumption at the Gawler Aquatic Centre, as adirect result of the installation more efficient water heating / pumpingequipment at the Centre

o $23k – reduction in fuel costs

o $15k – reduction in electricity consumption due to various environmentalefficiency initiatives

Graph 10 – Materials, Contracts & Other Expenses 2013/2014- 2015/2016

01,000,0002,000,0003,000,0004,000,0005,000,0006,000,0007,000,0008,000,0009,000,000

10,000,00011,000,000


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2.10 DEPRECIATION, AMORTISATION & IMPAIRMENT

Includes the depreciation of Council’s fixed assets (such as Buildings, Infrastructure (e.g. roads, footpaths and stormwater drainage), and Equipment) over their economic lives.

Table 14 – Depreciation Expense 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





DEPRECIATION

Depreciation - Equipment 227,127 298,392 433,968 442,977 442,977 (9,009) -2% 135,576 45.4%Depreciation - Buildings 302,537 236,699 251,111 281,124 281,124 (30,013) -11% 14,412 6.1%

Depreciation - Infrastructure 2,465,338 2,597,627 3,521,850 2,563,586 3,381,586 140,264 4% 924,223 35.6%

Extensive independent review of depreciation methodology undertaken during 2015/16

Depreciation - Other assets 158,938 156,103 160,182 158,081 158,081 2,101 1% 4,079 2.6%3,153,940 3,288,821 4,367,111 3,445,768 4,263,768 103,343 2% 1,078,290 32.8%


Depreciation expense increased by 32.8% ($1.078m) during the reporting period due to a combination of the following factors:

• As a result of changes to, and in the interpretation of, Australian AccountingStandard AASB116 Property, Plant and Equipment the carrying value ofinfrastructure assets as at 30 June 2015 increased by $28.353m. This increase,coinciding with the requirement to remove residual values for variousinfrastructure assets that had previously applied, materially increased Council’sdepreciation expense for such assets in the order of $900k;

• An increase in depreciation expense for equipment due to new depreciation as aresult of assets purchased from the previous financial year (e.g. depreciation ofcomputer hardware/software installed as part of the Digital Local GovernmentProject).

An extensive subsequent review of infrastructure assets was undertaken during the reporting period, which culminated in a $28.6m reduction in the valuation of infrastructure assets as at 30 June 2016. The valuation reduction was ultimately attributable to a combination of the following factors:

• Part of the review process included road pavement coring samples being taken.Such core sampling identified a component of Council’s road network, beingpredominantly road assets constructed prior to 1980, that had a road pavementdepth of 150mm, and not 300mm as previously assumed. As a result, thevaluation of such assets has been materially reduced;

• An identified duplication of various road infrastructure elements;• A reduction in unit rates applied as part of the valuation determination (due to

reduced costs of materials input)

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Graph 11 – Depreciation Expense 2013/2014- 2015/2016

0

500,000

1,000,000

1,500,000

2,000,000

2,500,000

3,000,000

3,500,000

4,000,000

4,500,000

5,000,000


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2.11 FINANCE COSTS

Includes the costs of financing the Council’s activities through borrowings or other types of financial accommodation.

Table 15 – Finance Costs 2013/2014- 2015/2016

2013/14 Actual

2014/15 Actual

2015/16 Actual





FINANCE COSTS

Debenture Loan / Overdraft Interest 811,474 740,571 624,187 690,269 620,269 3,918 1% (116,384) -15.7%

No fixed long term loan borrowings since 2010/11. Loan funding now sourced from short-term overdraft facility with LGFA when cashflow requires - overdraft can be repaid at any time as cashflow permits. This approach has delivered substantial interest expense savings to Council.

811,474 740,571 624,187 690,269 620,269 3,918 1% (116,384) -15.7%


Sound treasury management principles dictate that Council should only undertake external loan borrowings when it is financially required to do so – i.e. it should utilise its own working capital reserves (cash) first prior to drawing down external loan funds.

To minimise future interest costs, Council continues to utilise the short-term Cash Advance facility available from the Local Government Finance Authority to part-fund its capital works program or to fund its recurrent expenditure requirements outside of periods of peak cash inflows. The primary benefit of this approach is that the Cash Advance facility can be drawn down (and more importantly repaid) at any time as cashflow permits, whereas fixed long-term loans commit Council to contracted principal/interest payments over the life of the loan.

This approach, instigated during the 2011/12 financial year, has delivered considerable ongoing interest expense savings for the Council as outlined in Table 15 above.

Given that Council has not entered into any long-term external borrowings since the 2010/11 financial year, the subsequent 41% reduction in debt has created future loan borrowing capacity, which will progressively be utilised as major planned capital initiatives are completed in the next few years (e.g. the purchase and fit-out of the new Administration Centre, the redevelopment of the Civic Centre, etc.).

Graph 12 – Finance Costs 2013/2014- 2015/2016

0100,000200,000300,000400,000500,000600,000700,000800,000900,000

1,000,0001,100,000


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3. CAPITAL EXPENDITURE ANALYSIS

A summary of Capital Expenditure for the reporting period is outlined in Table 16 below.

Table 16 – Capital Expenditure summary 2015/2016

Project Note Work-in-Progress

Replacement / Renewal New / Upgrade TOTAL

Adopted Budget Forecast

Recreation / Open Space facilities:Park fencing program 21,662$ 21,662$ 20,000$ 26,000$ Gawler Aquatic Centre - Pool blanket 33,711$ 33,711$ 35,000$ 35,000$ Restore Deadmans Pass Waterhole & S/Water pollution works 28,703$ 28,703$ 30,000$ 30,000$ Playground Enhancements Program 1 15,851$ 94,820$ 110,671$ -$ 111,000$ Rollerskating equipment (Sport & Comm Centre) 9,977$ 9,977$ 10,000$ 10,000$ Design dog off-leash facilities 23,940$ 23,940$ 20,000$ 20,000$ Willaston Oval carpark upgrade 66,030$ 66,030$ 50,000$ 70,000$ Apex Park fitness & recreation precinct project 1 163,230$ 163,230$ -$ 164,000$ Rehabilitate Gawler Urban Rivers Biodiversity Program 118,070$ 118,070$ 120,000$ 120,000$ Install shade cover - Coleman Pde playground 1 4,843$ 4,843$ -$ 4,900$ Review pollution control for Springfield retention basin 2 -$ 5,000$ 5,000$ Pioneer Park - electrical upgrade to accommodate Gawler farmers market 2 -$ -$ 25,500$ Upgrade irrigation systems (various locations) 27,085$ 27,085$ 30,000$ 30,000$ TOTAL 39,791$ -$ 568,131$ 607,922$ 320,000$ 651,400$

Community Bldgs:Civic Centre redevelopment / Admin Centre purchase & fit-out 787,433$ 787,433$ 1,690,000$ 795,730$ Safe Roof access / Roof repairs & replacement 1 5,440$ 5,440$ -$ 10,880$ Implement Bldgs Asset Management Plan (various locations) 10,743$ 320,677$ 331,420$ 464,000$ 564,000$ Community Energy Efficiency Programs 1 79,076$ 79,076$ -$ 77,490$ Rehabilitate pumping station (Caravan Park) -$ 12,000$ 8,000$ Depot Office accommodation upgrade 19,061$ 19,061$ -$ 25,000$ Dog Pound upgrade 8,644$ 8,644$ 20,000$ 20,000$ Asbestos removal 5,925$ 5,925$ 20,000$ 20,000$ Gawler South Oval clubrooms - fire services upgrade 1 54,490$ 54,490$ -$ 60,000$ TOTAL 812,745$ 375,167$ 103,577$ 1,291,489$ 2,206,000$ 1,581,100$

Road / Footpath Infrastructure:Murray Street Upgrade (Stages 5 & 6) 113,169$ 224,326$ 337,495$ 1,080,000$ 210,000$ Town Centre Northern Entrance Points Project 1 2,685$ 2,685$ -$ -$ Gawler Mill Inn Bridge rehabilitation 2,640$ 2,640$ 250,000$ 150,000$ Unsealed Roads Resheeting program 95,285$ 95,285$ 90,000$ 96,000$ Jack Bobridge Bikepath 1 29,728$ 29,728$ -$ 20,000$ Disability access and pedestrian ramps 55,709$ 55,709$ 25,000$ 25,000$ Graetz St streetscaping 23,640$ 23,640$ 25,000$ 25,000$ Kerb/Gutter - Gawler River Road (Willaston) 59,802$ 59,802$ 70,000$ 70,000$

Investigate Pavement Stabilisation of Unsealed Rds 6,300$ 6,300$ 20,000$ 20,000$ Duffield Street (Gawler East) pavement upgrade 189,647$ 189,647$ 150,000$ 150,000$ Traffic management improvements -$ 33,000$ 33,000$ Upgrade traffic signals to DPTI standard -$ 80,000$ 40,000$ Gawler East Link road 163,025$ 163,025$ -$ 137,000$ Road Reseal Program 615,228$ 615,228$ 450,000$ 635,711$ Footpath Program 75,391$ 666,588$ 741,979$ 680,000$ 680,000$ Kerb / Gutter Program 49,851$ 49,851$ 64,000$ 64,000$ TOTAL 420,327$ 934,839$ 1,017,848$ 2,373,014$ 3,017,000$ 2,355,711$

Computer Hardware/Software:Records Management Software upgrade 31,760$ 31,760$ 30,000$ 30,000$ Implement Cemetery Management software 1 24,440$ 24,440$ -$ 31,960$ Purchase & implementation of electronic Expiation devices $0 -$ 7,500$

Purchase of Bluebeam software (multiple licence fee) - to enable electronic assessment of DA's $6,987 $6,987 -$ -$ Implementation of new HR software module 8,080$ $8,080 -$ 25,000$ Asset Management System -$ 12,000$ 12,000$ TOTAL 8,080$ -$ 63,187$ 71,267$ 42,000$ 106,460$

Stormwater Drainage:Replace Stormwater side-entry pits 4,190$ 4,190$ 15,000$ 15,000$ Willaston drainage network design 1 18,599$ 18,599$ -$ -$ Thomas Street drainage 69,842$ 69,842$ 55,000$ 55,000$ Southern Urban Areas stormwater design 1 5,021$ 5,021$ -$ 10,000$ Construct S/Water outlets Gawler Urban Rivers 193,255$ 193,255$ 185,000$ 185,000$ TOTAL 22,789$ 193,255$ 74,863$ 290,907$ 255,000$ 265,000$

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Project Note Work-in-Progress

Replacement / Renewal New / Upgrade TOTAL


Other Assets:Willaston Cemetery upgrade 167,160$ 167,160$ 190,000$ 190,000$ Streetlighting 12,686$ 16,941$ 29,627$ 38,000$ 38,000$

Investigate Water Reuse for Southern Urban Areas -$ 50,000$ -$ Light / Heavy Fleet Replacement Program 2,155$ 567,509$ 569,664$ 776,800$ 776,800$ Street furniture program 39,596$ 23,521$ 63,117$ 56,000$ 56,000$ Gawler History Plaques / Historic Walking Trail -$ 10,000$ -$ Design Walker Place Urban Precinct -$ 100,000$ -$ General Ledger Rewrite Project 14,380$ 14,380$ -$ 15,000$ Capitalisation of Salaries/Internal Plant Hire 3 -$ 200,000$ -$ TOTAL 223,291$ 603,716$ 16,941$ 843,948$ 1,420,800$ 1,075,800$

GRAND TOTAL 1,527,023$ 2,106,977$ 1,844,547$ 5,478,547$ 7,260,800$ 6,035,471$

Notes:

1. Completion of project from 2014/15 financial year

2. Project completed but costs expensed as recurrent expenditure

3. The final actual value of capitalised salaries is incorporated within the separate actualtotals for various individual projects.

4. BALANCE SHEET ANALYSIS

An analysis of Council’s Balance Sheet as at the reporting date is disclosed in Appendix 2.

Key outcomes include: (a) The actual level of Cash & Investments as at the reporting date was $1.99m,

which was $289k less than the forecast of $2.283m. This was attributable to thefollowing factors:

a. The Federal Government not continuing advance payments of theFinancial Assistance and Local Roads grant ($755k); partly offset by

b. A reduction of $359k in the value of outstanding debtors.(b) A reduction in the percentage of Rate debtors, from 4.97% to 3.95%, and a

reduction in the value of other Sundry debtors from $397k to $178k. Thereduction in both these debtor amounts is due reward for the efforts of Financestaff in proactively administering operations in this area.

(c) The total value of fixed assets reduced from $241m to $218m. Contributingfactors include:

a. $4.2m of assets received free of charge from developers ($5.8m less thanforecast);

b. $5.7m of capital expenditure ($300k less than forecast);c. ($4.37m) of depreciation ($103k above forecast);d. ($27.8m) revaluation decrement to infrastructure assets – refer Section

2.10 for further details.(d) A further $2.169m reduction in Council’s long term debt, thereby importantly

providing an increasing capacity for Council to fund the purchase and/orconstruction of new/upgraded assets;

(e) An increase of $270k in employee annual leave entitlements – refer Section 2.8for further details.

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5. EQUITY RESERVES ANALYSIS

Council manages a number of Equity Reserves for specific purposes as per below. An analysis of Council’s Equity Reserves is disclosed in Appendix 3.

(a) Carparking Reserve

Carparking contributions received as part of various development approvals are allocated to this Reserve upon receipt, in accordance with Section 50A of the Development Act 1993.

The Equity Reserve is used for the provision of other new carpark facilities.

Interest received on the funds is re-invested into the Equity Reserve in accordance with the Act.

(b) Open Space Reserve

Open Space contributions received as part of various development approvals are allocated to this Reserve upon receipt, in accordance with Section 50 of the Development Act 1993.

The funds are used towards the purchase / acquisition of facilities within Council’s parks, gardens, and recreational facilities.

(c) Stormwater Drainage Reserve

Developer contributions received, towards the provision of stormwater drainage infrastructure, are allocated to this Equity Reserve upon receipt.

The funds are transferred from the Reserve upon completion of associated capital works.

(d) Plant & Machinery Replacement Reserve

This Reserve is used towards the programmed replacement of fleet vehicles and road plant and machinery.

(e) Willaston Cemetery Reserve (including Babies Memorial)

Operating surpluses generated from the Cemetery are allocated to this Equity Reserve, to fund the provision of facilities or new projects at the Cemetery.

(f) Waste Management Service Charge

Council applies an annual service charge for the provision of kerbside waste management services, pursuant to Section 155 of the Local Government Act 1999. In instances where surplus funds are generated (i.e. where the funds generated from the service charge exceed the cost of providing the service) this reserve is credited with the surplus. In such instances, the surplus is rebated back to customers during the subsequent financial year.

(g) Property

This reserve is used for future infrastructure and property development. The funds presently contained within this reserve relate to developer contributions previously



30

received in 2012, towards the provision of infrastructure and property development in the southern urban areas. A component of such funds received have previously been utilised towards the construction of the Evanston Gardens Community Centre, with the remaining funds in the reserve (which accumulate interest on an annual basis) earmarked towards the future upgrade and expansion of facilities at Karbeethan Reserve.

(h) Dog & Cat Management Reserve

Any operating surpluses achieved as a result of Council’s Dog & Cat Management operations are allocated to this Reserve to fund the implementation of initiatives outlined in the Dog & Cat Management Plan.

In accordance with the Dog & Cat Management Act 1995, any surpluses derived from the service must be reinvested back into associated activities.

(i) Historic Walls

Council has previously resolved to allocate $25k per year, for 10 years, in the annual budget for the provision of grant funding towards the restoration of historic walls within Gawler. Any unspent budget funds from each year are transferred to this reserve.

(j) Property Improvement

In 2015/16, Council introduced the withholding of discretionary rate rebates for commercial properties in the Town Centre deemed to be in a state of neglect and detracting from the amenity of their locality.

The value of discretionary rate rebates withheld are retained in this reserve. The money in the Fund will then be made available to property owners or businesses (including those contributing rebates) in the Town Centre for improving the appearance of their premises.

(k) Urban Tree Fund

This reserve is used to fund the maintenance or planting of trees in a designated area which are or will (when fully grown) constitute as significant trees.

Contributions to this fund are required from various development assessment applications as part of conditions of approval.

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6. CASHFLOW STATEMENT ANALYSIS

An analysis of Council’s cashflow statement is provided as Appendix 4. Key outcomesare outlined below.

(a) Cashflows from Operating Activities

Net cash provided from Operating activities was $4.896m, which was $381k less than the forecast of $5.277m.

This variance was due to the Federal Government decision (in June 2016) to cease advance payments of the Financial Assistance / Local Roads grant allocations. This resulted in a subsequent reduction in cash inflows of $755k.

This shortfall was partly offset by a $353k reduction in the value of outstanding debtors during the reporting period.

(b) Cashflows from Investing Activities

Net cash utilised towards Investing activities (i.e. the investment in capital works programs), was $5.594m, which was $130k less than the forecast of $5.724m.

This variance was predominantly due to the investment in the replacement / renewal of fixed assets being slightly less than anticipated (refer Section 3 for an analysis of Capital Expenditure for the year).

It should be noted, however, that the original 2015/16 budget was predicated on $1.5m being realised from the sale of surplus property assets. Although potential properties for sale are being continually identified and progressed, such sale proceeds were ultimately not realised during the reporting period.

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7 APPENDICES

Appendix 1 – Statement of Comprehensive Income

2014/2015

Actual Actual Adopted

Budget Forecast

Variance to

Forecast$'000s $'000s $'000s $'000s $'000s

INCOMERates 18,564 19,502 19,429 19,496 6Statutory charges 701 711 734 703 8User charges 1,276 1,284 1,299 1,267 17Grants, subsidies and contributions 3,547 2,225 2,814 2,958 (733)Investment income 141 82 99 87 (5)Reimbursements 349 453 322 417 36Other income 18 53 51 45 8Net gain - joint ventures & associates 135 122 33 33 89Total Income 24,731 24,432 24,781 25,006 (574)

EXPENSESEmployee costs 8,849 9,409 9,264 9,155 254Materials, contracts & other expenses 10,175 10,233 10,469 10,071 162Finance costs 741 624 690 620 4Depreciation, amortisation & impairment 3,323 4,367 3,446 4,264 103Net loss - joint ventures & associates 65 42 - - 42Total Expenses 23,153 24,675 23,869 24,110 565

OPERATING SURPLUS / (DEFICIT) 1,578 (243) 912 896 (1,139)

Asset disposal & fair value adjustments (323) (410) (24) (24) (386)Amounts received specifically for new or upgraded assets 1,199 111 660 117 (6)Physical resources received free of charge 5,461 4,221 14,000 10,000 (5,779)NET SURPLUS / (DEFICIT) transferred to Equity Statement 7,915 3,679 15,548 10,989 (7,310)

Other Comprehensive IncomeChanges in revaluation surplus - infrastructure, property, plant & equipment 36,620 (27,819) - - (27,819)Share of other comprehensive income - joint ventures and associates (119) - - - -

TOTAL COMPREHENSIVE INCOME 44,416 (24,140) 15,548 10,989 (35,129)

2015/2016

An analysis of operating performance against the budget is included in Section 1.1 on page 3.

TOWN OF GAWLER



33

Appendix 2 – Balance Sheet

Actual 14/15

Actual 15/16


Variance to

Forecast$'000s $'000s $'000s $'000s $'000s

ASSETSCurrent AssetsCash and cash equivalents 4,899 1,994 - 2,283 (289)Trade & other receivables 1,406 1,047 1,287 1,406 (359)Inventories 20 17 17 20 (3)

Total Current Assets 6,325 3,058 1,304 3,709 651-

Non-current AssetsFinancial Assets 66 45 44 44 1Equity accounted investments in Council businesses 3,527 3,607 3,675 3,560 47Infrastructure, Property, Plant & Equipment 241,084 218,342 232,238 254,574 (36,232)Work-in-Progress 1,915 2,009 - - 2,009

Total Non-current Assets 246,592 224,003 235,957 258,178 (34,175)Total Assets 252,917 227,061 237,261 261,887 (34,826)

LIABILITIESCurrent LiabilitiesBank Overdraft - - 1,400 - (1,400)Trade & Other Payables 3,994 4,217 1,971 3,994 223Borrowings 2,169 1,231 1,231 1,231 0Provisions 2,132 2,371 1,699 2,282 89

Total Current Liabilities 8,295 7,819 6,301 7,507 1,088-

Non-current LiabilitiesBorrowings 8,652 7,421 7,421 7,421 0Provisions 151 142 147 151 (9)Liability - Equity accounted Council businesses - - 7 - 0

Total Non-current Liabilities 8,803 7,563 7,575 7,572 9- Total Liabilities 17,098 15,382 13,876 15,079 (1,097)NET ASSETS 235,819 211,679 223,385 246,808 (33,729)

EQUITYAccumulated Surplus 45,272 49,403 70,182 56,757 (7,354)Asset Revaluation Reserves 187,696 159,877 151,195 187,696 (27,819)Other Reserves 2,851 2,399 2,008 2,355 44TOTAL EQUITY 235,819 211,679 223,385 246,808 (35,129)

<<<<<2015/16>>>>>

Further analysis of the Balance Sheet is included in Section 4 on page 26.

TOWN OF GAWLER



34

Appendix 3 – Equity Reserves

Actual Adopted

Budget ForecastVariance to

Forecast$'000s $'000s $'000s

Transfers to Reserve:Carparking 9 10 10 (1)Open Space 0Stormwater Drainage 53 50 50 3Plant & Machinery Replacement 178 178Willaston Cemetery 52 32 55 (3)Waste Management Service Charge 0Infrastructure & Community Assets 0Property 25 33 33 (8)Dog & Cat Management 11 32 57 (46)Property Improvement 5 6 (1)Urban Tree Fund 1 1Historic Walls 24 15 9TOTAL 358 157 226 132

Transfers from Reserves:Carparking (12) (20) (20) 8Open Space (93) (100) (100) 7Stormwater Drainage (209) (204) (204) (5)Plant & Machinery Replacement (142) (87) (87) (55)Willaston Cemetery (98) (66) (89) (9)Waste Management Service Charge (16) (34) (34) 18Infrastructure & Community Assets (211) (146) (146) (65)Property (50) 0Property Improvement (2) 2Dog & Cat Management (33) (40) (40) 7TOTAL (814) (747) (722) (92)

A further analysis of movements in Equity reserves is included in Section 5 on pages 26-27.

TOWN OF GAWLER



35

Appendix 4 – Cash Flow Statement

Actual 14/15

Actual 15/16


Variance to

Forecast$'000s $'000s $'000s $'000s $'000s

CASH FLOWS FROM OPERATING ACTIVITIESReceipts Operating receipts 24,177 24,485 24,649 24,886 (401) Investment receipts 141 74 99 87 (13)Payments Operating payments to suppliers & employees (17,428) (19,018) (19,733) (19,076) 58 Finance payments (741) (645) (690) (620) (25)Net Cash provided by (or used in) Operating Activities 6,149 4,896 4,325 5,277 (381)

CASH FLOWS FROM INVESTING ACTIVITIESReceipts

Amounts specifically for new or upgraded assets 1,199 111 60 117 (6)Sale of replaced assets 173 86 172 172 (86)Sale of surplus assets - - 1,500 - -Repayments of loans by community groups 20 22 22 22 (0)

PaymentsExpenditure on renewal/replacement of assets (2,370) (2,781) (2,780) (2,994) 213Expenditure on new/upgraded assets (3,860) (3,032) (4,481) (3,041) 9Loans made to Community Groups - - - - -

Net Cash provided by (or used in) Investing Activities (4,838) (5,594) (5,507) (5,724) 130

CASH FLOWS FROM FINANCING ACTIVITIESReceipts Proceeds from Bonds & Deposits 160 - - - -Payments Repayment of Bonds & Deposits - (37) - - (37) Repayments of Borrowings (1,078) (2,169) (2,169) (2,169) 0Net Cash provided by (or used in) Financing Activities (918) (2,206) (2,169) (2,169) (37)Net Increase (Decrease) in cash held 393 (2,904) (3,351) (2,616) (288)

Cash & cash equivalents at beginning of period 4,506 4,899 1,951 4,899 (0)Cash & cash equivalents at end of period 4,899 1,994 (1,400) 2,283 (289)

<<<<<2015/16>>>>>

TOWN OF GAWLER



36

Appendix 5 – Financial Indicators

Actual 14/15

Actual 15/16


Variance to

Forecast$'000s $'000s $'000s $'000s $'000s

Operating Surplus * 1,578 (243) 912 896 (1,139)

Operating Surplus Ratio * 6% (1%) 5% 5%

Net Financial Liabilities 10,727 12,296 12,545 11,346 950

Net Financial Liabilities Ratio 43% 50% 51% 45%

Asset Sustainability Ratio 66% 97% 210% 163%

<<<<<2015/16>>>>>

Being the operating surplus/(deficit) before capital amounts

This ratio expresses the operating result as a Total Operating Revenue of Rate revenue

Net Financial Liabilities are defined as total liabilities less financial assets (excluding Equity accounted investments in Council businesses)

Being the Net Financial Liabilities as a percentage of total operating revenue (excluding NRM levy)

Being net capital expenditure on the renewal and replacement of existing assets as a percentage of Infrastructure & Asset Management Plan required expenditure

TOWN OF GAWLER



37

Appendix 6 – Uniform Presentation of Finances

Actual 14/15

Actual 15/16


Variance to

Forecast$'000s $'000s $'000s $'000s $'000s

Income 24,731 24,432 24,781 25,006 (574)less Expenses (23,153) (24,675) (23,869) (24,110) (565)Operating Surplus / (Deficit) 1,578 (243) 912 896 (1,139)

less Net Outlays on Existing AssetsCapital Expenditure on renewal and replacement of Existing Assets 2,371 2,781 2,780 2,994 (213)less Depreciation, Amortisation and Impairment (3,323) (4,367) (3,446) (4,264) (103)less Proceeds from Sale of Replaced Assets (173) (86) (172) (172) 86

1,125 1,672 838 1,442 230

less Net Outlays on New and Upgraded Assets

Capital Expenditure on New and Upgraded Assets(including investment property & real estate developments) 3,860 3,032 4,481 3,041 (9)less Amounts received specifically for New and Upgraded Assets (1,199) (111) (660) (117) 6less Proceeds from Sale of Surplus Assets(including investment property and real estate developments) - - (1,500) - -

(2,661) (2,921) (2,321) (2,924) 3

Net Lending / (Borrowing) for Financial Year 42 (1,492) (571) (586) (906)

<<<<<2015/16>>>>>

Net Lending / (Borrowing) equals Operating Surplus / (Deficit), less Net Outlays on non-financial assets. The Net Lending / (Borrowing) result is a measure of the Council's overall (i.e. Operating and Capital) budget on an accrual accounting basis. The Net Lending / (Borrowing) result can be expected to fluctuate from year to year, given the lumpy nature of some capital expenditure. Achieving a zero result on the Net Lending / (Borrowing) measure in any one year essentially means that the Council has met all of its expenditure (both operating and capital) from the current year's revenues. The amount of Net Lending in any one year decreases the level of Net Financial Liabilities in the year by that amount. Conversely, the amount of Net Borrowing increases the level of Net Financial Liabilities.

TOWN OF GAWLER



ATTACHMENT 2 Town of Gawler Non-Financial Indicators Report

for the period 01 July 2015 – 30 June 2016

for the year ending 30 June 2016

Caravan Park

Graph 1.1

Community Assistance (Volunteer Services)

Graph 2.1

9.4%

12% 12.4% 13.0%

0.0%2.0%4.0%6.0%8.0%

10.0%12.0%14.0%

Financial Years% R

etur

n of

Inve

stm

ent

Caravan Park - Net Return on Investment

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

7,297

3,250

2,183 3,117

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

Financial Years

Num

ber o

f Hits

Rem

oved

Graffiti Hits Removed

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

There has been an increase in graffiti hits in 2015/2016 due to a number of factors such as new sub-divisions within the Town of Gawler and also an increase in foot traffic through the recently developed Reid Reserve. It has also been noted by SAPOL that they have also had an increase in convictions relating to graffiti in the last year.

The implementation of the new Customer Request Module (CRM) has simplified the process of residents reporting graffiti within the town. This has resulted in an increase in the graffiti hits reported.

Comments:

This indicator represents the annual return (property rent received) as a percentage of the carrying value of the asset.

The result from 2015/2016 is consistent with the results from the last 3 years.



Graph 2.2

Customer Service

Graph 3.1

1,482

935 866 1,022

-

200

400

600

800

1,000

1,200

1,400

1,600

Financial Years

Hour

s Rem

ovin

g G

raff

iti

Volunteer Hours Removing Graffiti

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

802 834 840 826

- 100 200 300 400 500 600 700 800 900

Financial Years

Num

ber o

f Pro

pert

y Se

arch

es Property Searches

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

There has been an increase in graffiti hits in 2015/2016 due to a number of factors such as new sub-divisions within the Town of Gawler and also an increase in foot traffic through the recently developed Reid Reserve. It has also been noted by SAPOL that they have also had an increase in convictions relating to graffiti in the last year.

The implementation of the new Customer Request Module (CRM) has simplified the process of residents reporting graffiti within the town. This has resulted in an increase in the number of hours spent by volunteers removing graffiti..

Comments:

The level of property searches processed was consistent with results for the 2013/14 and 2014/15 financial years.



Graph 3.2

Dog & Cat Control

Graph 4.1

4,206 4,066

4,807 4,579

-

1,000

2,000

3,000

4,000

5,000

6,000

Financial Years

Num

ber o

f Cus

tom

er A

ctio

n Re

ques

ts

Customer Action Requests

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

5,475 5,313 5,165 5,335

0

1,000

2,000

3,000

4,000

5,000

6,000

Financial Years

Num

ber o

f Reg

iste

red

Dogs

Registered Dogs

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The increase in 2014-2015 of the volume of requests was partly due to a system update enabling customers to lodge requests on-line, and enhanced use by internal business units as a tracking/reporting tool.

Comments:

There was an increase in the number of registered dogs in 2015/16, which restored the number to a level consistent with the 2013/2104 financial year result.



Graph 4.2

Graph 4.3

135

706

25

325

-

100

200

300

400

500

600

700

800

Financial Years

Num

ber o

f Exp

iatio

ns Is

sued

Dog Expiations

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

36

22

-

5

10

15

20

25

30

35

40

Financial Years

Num

ber o

f Dog

Att

acks

Dog Attacks

2014/2015 Actuals

2015/2016 Actuals

Comments:

The large increase in the volume of expiations during 2013/2014 and again in 2015-2016 was due to a Council unregistered dog door knock survey undertaken.

Comment:

Councils Animal Management Officers investigate all reported dog attacks and when considered appropriate, owners are fined and control orders can be placed on the offending animal.



Graph 4.4

General Inspectorate

Graph 5.1

988

383

-

200

400

600

800

1,000

1,200

Financial Years

Num

ber o

f Rep

orts

Dogs Reported Wandering at Large

2014/2015 Actuals

2015/2016 Actuals

197

1,076

570 426

-

200

400

600

800

1,000

1,200

Financial Years

Fire

Pre

vent

ion

Not

ices

Sen

t

Fire Prevention Notices

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The significant increase in fire prevention notices in 2013/2014 was due to Inspectorial Staff taking a proactive approach and inspecting all properties in Gawler. In previous years only those properties known to cause concern or complaints were inspected.

2014/2015 and 2015/2016 also saw a significant number of fire prevention notices issued as the inspection program was carried out once again.

Comment:

The Animal Management Plan adopted by Council on the 22 April 2014 has an emphasis on responsible dog ownership. This includes educating the community and promoting dog obedience programs. This, along with sufficient identification, will hopefully reduce the number of dogs wandering at large and, if they are found, reuniting them with their owner within a short time-frame.

The 2015/2016 result suggests that the work conducted by the Rangers towards education throughout the community is having a positive outcome.



Graph 5.2

Human Resources

Graph 6.1

29

- 1

17

-

5

10

15

20

25

30

35

Financial Years

Num

ber o

f Exp

iatio

ns Is

sued

Fire Prevention Notices Expiations

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

12%

15%

10%

7%

0%

2%

4%

6%

8%

10%

12%

14%

16%

Financial Years

% o

f Sta

ff Tu

rnov

er

Staff Turnover

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

No Fire Expiation Notices were issued in 2013/2014.

Comments:

Consistent with all organisations, some staff turnover is to be expected each year.

The relatively recent introduction of the Human Synergistic Framework (which is based on enshrining appropriate corporate values, behaviours and habits throughout the organisation), together with improved recruitment techniques, is leading to a more effective and stable workforce.



Graph 6.2

Graph 6.3

748 656

614 695

-

100

200

300

400

500

600

700

800

Financial Years

Num

ber o

f Sic

k Da

ys T

aken

Staff Sick Days

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

65.8

38.7

61.4

44

0

10

20

30

40

50

60

70

Financial Years

Days

Los

t

Number of Days Lost to Work Injuries

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

Based on 116 full-time equivalent staff, the number of sick days taken in 2015/2016 equates to 6 days per employee.

Comments:

The increase in 2012/2013 and again in 2014/2015 was a result of the type of injuries incurred by staff which required additional days off work.



Graph 6.4

Graph 6.5

18,187 16,533

19,183

22,093

0

5,000

10,000

15,000

20,000

25,000

Financial Years

Annual Leave Liability Hours

2012/2013

2013/2014

2014/2015

2015/2016

2,770

3,461 3,514

2,487

- 500

1,000 1,500 2,000 2,500 3,000 3,500 4,000

Financial Years

Time in Lieu Liability Hours

2012/2013

2013/2014

2014/2015

2014/2015

Comments:

The decline in 2013/2014 was due to a termination payout for a staff member who had accrued a high amount of annual leave.

Annual Leave liability is an issue that is currently being addresses by Council Management. It has been recognised that the increasing amount of annual leave not taken by Council employees represents the current workload pressure, however, it is also recognised the importance of employees taking leave from a WHS, internal control and health and wellbeing perspective. Further management techniques have since been introduced towards reducing the liability to an appropriate level.

Comments:

Council’s Leave liability was significantly reduced in 2015/2016 predominantly due to a number of payouts to staff who had accrued a large amount of TOIL. Council Management have now put into place new processes in an attempt to reduce the amount of TOIL accrued by employees.



Graph67.6

Immunisations

Graph 7.1

26,999 28,493 33,007 33,345

05,000

10,00015,00020,00025,00030,00035,00040,000

Financial Years

Hour

s

LSL Hours Liability

2012/2013

2013/2014

2014/2015

2015/2016

4,328

3,083

1,397

2,035

-

1,000

2,000

3,000

4,000

5,000

Financial Years

Tota

l Num

ber o

f Vac

cina

tions

Vaccinations

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

Peak times for student immunisations are September – November & February – July. Peak times for flu immunisations are March – May.

The decline in 2014/2015 was due to the reduction in school contracts & discontinuing the Hep B vaccine offered through the public clinic.

Comments:

The long service leave hours liability includes hours accrued but not yet available to various employees.



Information Technology

Graph 8.1

Commonwealth Home Support Program

Graph 9.1

103,144 116,666 122,026 126,207

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Financial Years

Num

ber o

f Vis

its to

Web

site

Visits to Council Website

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

788 767 695 653

- 100 200 300 400 500 600 700 800 900

Financial Years

No.

of C

lient

s

CHSP Clients

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

This graph illustrates the number of visits to www.gawler.sa.gov.au

Comments:

This graph represents the number of clients that the Commonwealth Home Support Program (previously known as Home Assist Community Care) had on their books in the financial year.

Despite the decline in number of clients, the type of jobs and the number of hours taken to complete the jobs have exceeded 2014/2015 Result.



Graph 9.2

Library

Graph 10.1

7,232

9,972

-

2,000

4,000

6,000

8,000

10,000

12,000

Financial Year

CHSP - Hours Taken to Complete Jobs

2014/2015 Actuals

2015/2016 Actuals

14,352

10,550 8,933 8,631

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Financial Years

Num

ber o

f Ac

tive

Borr

ower

s Library Active Borrowers

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The introduction in the 2013/2014 financial year of the State-wide One Card System allows users to choose one library location which is where their library membership is assigned. Previous to the One Card system, users had various library cards to a host of libraries. Library users become inactive when a user has not been active for a period of 3 years.

Comments:

The hours taken to complete jobs for the community have exceeded the annual 2014/2015 result by 2,740 hours. Despite the decline in clients, this statistic shows the service continues to provide benefits to the community.



Graph 10.2

Graph 10.3

115,643 123,222 124,339 130,281

-

20,000

40,000

60,000

80,000

100,000

120,000

140,000

Financial Years

Num

ber o

f Loa

ns

Library Loans

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

60%

44% 37% 36%

0%

10%

20%

30%

40%

50%

60%

70%

Financial Years

% o

f Pop

ulat

ion

Library Users as a % of Population

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The number of loans has remained relatively stable over the last 4 years with 2015/2016 result a slight improvement from previous years.

Comment:

This statistic shows what percentage of the population (obtained from the 2011 census) has recorded Gawler as their primary library through the State-wide One Card System.



Graph 10.4

Graph 10.5

63 70

99 87

0

20

40

60

80

100

120

Financial Years

Num

ber o

f Eve

nts H

eld

Library Events Held

2012/2013

2013/2014

2014/2015

2015/2016

2904

2379 2753 2,801

0

500

1000

1500

2000

2500

3000

3500

Financial YearsNum

ber o

f Att

ende

es a

t Eve

nts

Attendees at Library Events

2012/2013

2013/2014

2014/2015

2015/2016

Comment:

These statistics show the number of events held in each financial year by the Library. These events include Author Visits, History Week, School Holiday Programs, and Preschool Story Time etc.

Comment:

These statistics show the number of people who attended events held by the library.



Open Space

Graph 11.1

Parking Control

Graph 12.1

318.56 349.91

435.91

050

100150200250300350400450500

Financial Years

Hect

ares

Mai

ntai

ned

Hectares of Open Space Maintained

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

1,780

1,453 1,548 1,400 1,499

-

500

1,000

1,500

2,000

Financial Years

Num

ber o

f exp

iatio

ns is

sued

Parking Expiations

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Annual Budget

2015/2016 Actuals

Comments:

The number of parking expiations issued in 2015-2016 was 16.72% behind the annual adopted budget estimate of 1800 expiations.

Council elected to reduce this estimate by 400 expiations in the 3rd Qtr. Budget Review from a target of 1,800 expiations to 1,400. As a direct result of additional staffing resources, Council managed to exceed the reduced target by 99 expiations and the result YTD in 2016-2017 continues to show great improvement.

Comments:

This number represents all Council owned land that is maintained with activities such as mowing, slashing, poisoning, planting, etc. This figure does not include untouched areas which equate to approximately 60 hectares. The increase in 2015/2016 is due to the addition of 4.350 hectares of land obtained at the intersection of Tiver Rd and Main North Rd.



Plant Utilisation

Graph 13.1

Preventative Health Services

Graph 14.1

92% 86%

99.6% 100%

82.2%

0%

20%

40%

60%

80%

100%

120%

Financial Years

Plant Utilisation

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Budget

2015/2016 Actuals

191 178 187 178 177

-

50

100

150

200

250

Financial Years

Num

ber o

f Foo

d In

spec

tions

Food Inspections

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals


2015/2016 Actuals

Comments:

Food premises inspections are based on risk ratings which determine the frequency of the inspection e.g. 6, 12 and 18 month intervals.

The result for 2015-2016 was only 1 inspection short of annual target.

Comments:

This percentage represents the usage of Council’s plant (tractors, trucks, utilities, vehicles, etc.) compared to the utilisation estimated within the revised budget.

Due to a new procedure for capturing costs of our light fleet, the plant utilisation now only includes heavy fleet/plant.



Graph 14.2

Rates Administration

Graph 15.1

78

53 55

23

38

- 10 20 30 40 50 60 70 80 90

Financial Years

Num

ber o

f Foo

d Au

dits

Food Audits

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals


2015/2016 Actuals

5.3%

4.36% 4.87%

3.5% 3.95%

0.0%

1.0%

2.0%

3.0%

4.0%

5.0%

6.0%

Financial Years

%

% of Rate Debtors in Arrears

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Target Result

2015/2016 Actuals

Comments:

Food Audits are carried out by Council staff. Food Audits are required by law for any business providing food to vulnerable populations and are rated using a risk classification method.

Businesses can select their auditors from a list of accredited auditors across the State.

In 2015/2016 Council elected to reduce the number of food audits conducted by staff (outside of the Council area) to focus more on statutory requirements.

In the 2nd Qtr. Budget Review, the projected reduction in income was disclosed; however, Council has exceeded the revised budget by $6K.

Comments:

Council’s 2015/2016 business plan target was to achieve outstanding rate debtors of less than 3.5% as at 30 June 2016. The Administration is extremely pleased with the 2015/2016 result and credits the proactive processes implemented by the Rates Department with the improved outcome.



Graph 15.2

Records Management

Graph 16.1

10,066 10,388 10,639 10,834

-

2,000

4,000

6,000

8,000

10,000

12,000

Financial Years

Num

ber o

f Rat

eabl

e Pr

oper

ties Rateable Properties

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

61,920 58,411

71,584

87,180

-

20,000

40,000

60,000

80,000

100,000

Financial Years

Num

ber o

f Inc

omin

g Re

cord

s Corporate Records Recorded

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The number of rateable properties has increased by over 2.5% for the last four financial years, and is representative of the considerable development growth that has been occurring.

Comments:

These records are incoming, outgoing and internal Council documents that are registered by all employees into the electronic Records Management database. The improvement is a direct result of ongoing training provided to staff and it is envisaged that this will continue to improve substantially over the coming years.

It is increasingly important, and a legislative requirement under the State Records Act, that all Council records are captured in the electronic data base.



Graph 16.2

Swimming Pool

Graph 17.1

8

6 5

8

-

2

4

6

8

10

Financial Years

Num

ber o

f Req

uest

s

Freedom of Information Requests

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

56,144 58,335 55,725 53,162

-

10,000

20,000

30,000

40,000

50,000

60,000

70,000

Financial Years

Num

ber o

f Vis

itors

Swimming Pool Visitors

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

Due to the 2015/2016 season concluding earlier than 2014/2015, there was a reduction in the patronage for casual swimming and swimming lessons.

Comment:

The Freedom of Information Act 1991 allows individuals the legal right to view Council’s documents, or request an amendment to documents about that individual which are incomplete, incorrect or out of date.



Graph 17.2

Tourism

Graph 18.1

653

839

1,008

-

200

400

600

800

1,000

1,200

Financial Years

Num

ber o

f Enr

olm

ents

Swim School Enrolments

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

21,331 19,481 19,447 19,371

-

5,000

10,000

15,000

20,000

25,000

Financial Years

Num

ber o

f Vis

itors

to G

awle

r

Visitors to Gawler Information Ctr.

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The graph represents the visitors to the Visitors Information Centre remaining consistent over the last 3 years.

Comments:

This amount represents the enrolments in swim school for both term 1 and term 4.



Town Planning

Graph 19.1

Waste Management

Graph 20.1

821 774 791

600

777

-

100

200

300

400

500

600

700

800

Financial Years

Num

ber o

f Dev

elop

men

t App

licat

ions

Lo

dged

Development Applications

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals


2015/2016 Actuals

4,512 4,470 4,582 5,085

-

1,000

2,000

3,000

4,000

5,000

6,000

Financial Years

Tonn

es

General Waste Collected - NAWMA

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The volume of development applications received has remained relatively stable for the last 3 financial years.

Comments:

There was an increase in the volume of general household waste collected in 2015/16, after remaining relatively stable for the previous 3 financial years.

Given annual population increases experienced, an increase in the volume of waste collected is not necessarily unexpected.



Graph 20.2

Graph 20.3

1,940 1,962 1,946 1,976

-

500

1,000

1,500

2,000

2,500

Financial Years

Tonn

es

Waste Collected - NAWMA Recycled

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

1,489

1,880 1,732 1,797

-

500

1,000

1,500

2,000

Financial Years

Tonn

es

Waste Collected - NAWMA Green

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The volume of recyclable waste collected has remained relatively stable over the last 4 years.

Comments:

The volume of green waste collected has remained relatively stable across the last 3 financial years.



Willaston Cemetery

Graph 21.1

Water Consumption

Graph 22.1

85

68 79

101

-

20

40

60

80

100

120

Financial Years

Num

ber o

f Bur

ials

Burials

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

62,253 62,752

84,316

63,000

82,931

- 10,000 20,000 30,000 40,000 50,000 60,000 70,000 80,000 90,000

Financial Years

Kilo

litre

s

Water Consumption - Sports Facilities

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals


2015/2016 Actuals

Comments:

There was a marked increase in the volume of burials in 2015/2016.

Comments:

The fluctuation in water consumption is impacted by annual rainfall, seasonal demand, special events, vandalism, horticulture maintenance and shared water services.

The demand for water in irrigating Council’s sporting facilities is supported by the automated monitoring and irrigation system

The rainfall in 2015-2016 was greater than 2014-2015 which resulted in less water being consumed on sports facilities throughout Gawler.



Graph 22.2

Graph 22.3

19,333 24,979

44,856 41,258

05,000

10,00015,00020,00025,00030,00035,00040,00045,00050,000

Financial Years

Water Consumption - Parks & Gardens

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

110,270 116,806

166,465 153,196

- 20,000 40,000 60,000 80,000

100,000 120,000 140,000 160,000 180,000

Financial Years

kl's

used

Total Water Consumption (Council Wide)

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals

Comments:

The fluctuation in water consumption is impacted by annual rainfall, seasonal demand, special events, vandalism, horticulture maintenance and shared water services. Parks and Gardens water consumption is also based on the agreed service level of the “class” that the particular park or garden falls into.

The demand for water in irrigating Council’s parks and gardens is supported by the automated monitoring and irrigation system.

The rainfall in 2015-2016 was greater than 2014-2015 which resulted in less water being consumed on parks & gardens.

Comment:

This is the total water consumed by Council including building, parks and gardens and open space.



Graph 22.4

322.2

485

261.4 325.2

0

100

200

300

400

500

600

Financial Years

mm

's

YTD Rainfall

2012/2013 Actuals

2013/2014 Actuals

2014/2015 Actuals

2015/2016 Actuals



Item 7.4 – Council Comparative Data Report (as at 30 June 2015)

ATTACHMENT 1 Council Comparative Data (as at 30 June 2015)

ATTACHMENT 2 SA Local Government Sector Financial Indicators Report2016



1

COUNCIL COMPARATIVE DATA

AS AT 30TH JUNE 2015

TOWN OF GAWLER



ATTACHMENT 1

2 TOWN OF GAWLER AUDIT COMMITTEE MEETING 5 OCTOBER 2016


3

COUNCIL COMPARATIVE DATA FOR THE FINANCIAL YEAR ENDING 30TH JUNE 2015

Introduction:

Since the inaugural report prepared as at 30 June 2008, annual comparative graphs have been prepared with Councils identified as having meaningful and relevant similarities with our Council. This report discloses comparative data for the year ending 30 June 2015.

Given that each Council has its own unique set of demographics, characteristics, and long-term goals and strategies, it is unrealistic to draw too many definitive conclusions relating to good or poor performance based on the information displayed. General observations, however, have been included in the notes to the various graphs where appropriate.

The data used is that most recently available from the SA Local Government Grants Commission database (as at 30 June 2015) which, in turn, is reliant on the completion and accuracy of annual returns lodged by Councils with the Commission. Thus the data is ultimately reliant on the integrity of the information provided to the Grants Commission from Councils on an annual basis.

Where appropriate, further specific reference has been made to individual Council websites to validate the accuracy of the Grants Commission data (particularly rating data). In some instances, this has resulted in corrections being made to data results.

Graphs have been prepared under the following headings:

Graph No. Key Compatibility Data:

Council area (hectares) 1 Road Lengths (Kms) 2 Estimated Council Population 3 Number of Employees (FTE) 4 Number of Rateable Assessments 5 Total General Rate Revenue 6

Rating: Reliance on General Rate revenue 7 Average Residential Rates 8 Minimum Rate 9

Debt: Net Debt 10

Financial Sustainability Indicators Operating Surplus / (Deficit) Ratio 11 Net Financial Liabilities Ratio 12 Asset Sustainability Ratio 13

September 2016



4

TOWN OF GAWLER COMPARATIVE DATA AS AT 30 JUNE 2015



5




6




7

GRAPH 3 – ESTIMATED COUNCIL POPULATION

The table below indicates the annual movement in the estimated population for each Council. Not surprisingly, given the development growth occurring in the town, Gawler had the 2nd largest percentage increase.

Council 2014 Population 2015 Population Movement % Movement Mt Barker 31,950 32,558 608 1.9% Gawler 22,219 22,618 399 1.8% Victor Harbor 14,938 15,169 231 1.5% Light Regional 14,648 14,841 193 1.3% Murray Bridge 20,740 20,971 231 1.1% Prospect 21,247 21,416 169 0.8% Barossa 22,964 23,104 140 0.6% Mt. Gambier 26,246 26,348 102 0.4% Port Pirie 17,646 17,540 -106 -0.6%Wattle Range 11,578 11,460 -118 -1.0%



8




9

GRAPH 4 – NO. OF EMPLOYEES (FTEs)

The key factor behind Murray Bridge having a far higher number of employees is due to the fact that they provide a Nursing Home facility (Lerwin Nursing Home).

The table below indicates the movement from 2014-2015 in the number of employees for each Council.

Council No. of Employees 2014

No. of Employees 2015

Movement

Barossa 126 129 3 Murray Bridge 177 180 3 Victor Harbor 98 100 2 Gawler 104 106 2 Mt. Barker 148 149 1 Pt. Pirie 94 95 1 Wattle Range 96 96 0 Light Regional 73 71 -2Mt. Gambier 118 116 -2Prospect 76 74 -2

Comparison of staffing numbers should be cautioned as numbers can vary depending on whether certain services are provided by in-house staff or by external contractors.

Further, the staff numbers can also be distorted by instances where a Council may receive a Government subsidy to fund a specific new Project Officer position for a period of time.



10


7,693

8,938 9,624

10,155 10,408 10,639

11,564 12,326

13,710 14,312

-

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

Light WattleRange

Prospect Port Pirie VictorHarbor

GAWLER MurrayBridge

Barossa Mt Gambier Mt Barker

No, o

f Rat

eabl

e As

sess

men

ts

COUNCIL

Graph 5 - No. of Rateable Assessments



11

GRAPH 5 – NO. OF RATEABLE ASSESSMENTS

The table below outlines the movement in rateable assessments from 2014 – 2015.

Council Rateable Assessments 2014

Rateable Assessments 2015

Movement

Mt. Barker 14,037 14,312 275 Gawler 10,388 10,639 251 Barossa 12,186 12,326 150 Mt. Gambier 13,584 13,710 126 Murray Bridge 11,444 11,564 120 Victor Harbor 10,312 10,408 96 Light Regional 7,604 7,693 89 Prospect 9,609 9,624 15 Wattle Range 8,933 8,926 -7Pt. Pirie 10,182 10,155 -27

The table confirms the development growth being experienced by Gawler compared to similar Councils.



12




13

GRAPH 6 – TOTAL NET GENERAL RATE REVENUE

This graph illustrates the total value of General Rate revenue for each Council – i.e. it excludes Separate Rates and Service Rates/Charges that may be separately levied in addition to the General rate.

The percentage increase in General Rates revenue (inclusive of new revenue from development growth, etc.) from 2014 to 2015 for each Council is outlined in the table below.

Council Rate Revenue

2014 Rate Revenue

2015 Movement % Movement Port Pirie 11,863 12,844 981 7.6% Gawler 15,115 16.277 1,162 7.1% Mt. Barker 21,125 22,732 1,607 7.1% Murray Bridge 16,842 18,114 1,272 7.0% Prospect 16,015 17,150 1,135 6.6% Barossa 19,896 21,098 1,202 5.7% Victor Harbor 17,050 18,055 1,005 5.5% Mt. Gambier 16,220 17,017 797 4.7% Light Regional 12,354 12,905 551 4.3% Wattle Range 13,219 13,704 485 3.5%

The base percentage increase for Gawler in 2015 was 4% (excluding growth factor of 3.6%). The abnormally high growth factor of 3.6% was predominantly due to the new ‘Gawler Green’ commercial precinct. The combined revenue increase of 7.6% was slightly offset by an increase in mandatory rate rebates provided, due to an increase in the number of properties being eligible for such a rebate, hence culminating in the net 7.1% revenue increase outlined in the table above.



14

This page is intentionally blank



15

RATING COMPARISONS



16


54% 55%58% 59%

63%66%

70%73%

76%

82%

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Port Pirie MurrayBridge

Mt Barker WattleRange

Barossa Mt Gambier GAWLER Light VictorHarbor

Prospect

RELI

ANCE

ON

GEN

ERAL

RAT

E RE

VENU

E

COUNCIL

Graph 7 - Reliance on General Rate revenue



17

GRAPH 7 – RELIANCE ON GENERAL RATE REVENUE

The graph illustrates net general rate revenue as a percentage of the total operating revenue for the Council, and highlights the significant revenue reliance that Local Government across the board has on its major revenue stream.

Reliance on General Rate revenue may invariably fluctuate from year to year, particularly based on the level of grant funding received from other tiers of government (which can fluctuate based on funding programs available) and the level/nature of other revenue received (e.g. Murray Bridge has the lowest reliance predominantly due to subsidies and fees received from its Nursing Home facility – without which its reliance is currently 83% (2015/16 budget)).

The table below outlines the annual percentage for each Council from 2008 to 2015. Gawler’s increased revenue reliance from 65% to 74% in 2014 was partly attributable to the closure of the Waste Transfer Station facility closure in February 2013.

Council 2008 2009 2010 2011 2012 2013 2014 2015 Prospect 81% 78% 80% 80% 80% 79% 84% 82% Victor Harbor 67% 71% 73% 71% 76% 76% 77% 76% Light Regional 52% 48% 55% 67% 68% 68% 76% 73% Gawler 56% 58% 61% 64% 63% 65% 74% 70% Mt. Gambier 66% 63% 65% 69% 64% 68% 72% 66% Wattle Range 81% 76% 73% 74% 68% 62% 67% 59% Pt. Pirie 48% 49% 56% 56% 46% 61% 64% 54% Barossa 58% 60% 59% 61% 63% 61% 62% 63% Murray Bridge 50% 47% 48% 54% 52% 54% 60% 55% Mt. Barker 52% 53% 55% 55% 56% 56% 58% 58% AVERAGE 61% 60% 61% 65% 64% 65% 69% 66%



18


$1,021

$1,252 $1,314 $1,338

$1,436 $1,484

$1,533 $1,614 $1,618

$1,683

$-

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

Mt Gambier Port Pirie WattleRange

Light MurrayBridge

Barossa GAWLER Prospect Mt Barker VictorHarbor

$

COUNCIL

Graph 8 - Average Residential Rates



19

GRAPH 8 – AVERAGE RESIDENTIAL RATES

This graph illustrates the average residential rates (including service rates and charges) for each Council, calculated by total residential rates divided by the number of residential ratepayers.

Council Average Rate

2014 Average Rate

2015 Movement % Movement Wattle Range 1,270 1,314 44 3.5% Mt. Gambier 984 1,021 37 3.8% Victor Harbor 1,622 1,683 61 3.8% Gawler 1,482 1,552 70 4.7% Prospect 1,531 1,614 83 5.4% Barossa 1,407 1,484 77 5.5% Mt. Barker 1,534 1,618 84 5.5% Light Regional 1,265 1,338 73 5.8% Murray Bridge 1,350 1,436 86 6.4% Port Pirie 1,154 1,252 98 8.5%

The 4.7% increase for Gawler incorporates the 4% increase in General rates and a $17 increase in the Waste Management Service Charge (from $158 to $175).



20


$- $- $- $-

$595

$660

$785

$844 $900

$1,050

$-

$200

$400

$600

$800

$1,000

$1,200

Mt Gambier Port Pirie Barossa VictorHarbor

WattleRange

Mt Barker Light MurrayBridge

GAWLER Prospect

COUNCIL

Graph 9 - Minimum Rate



21

GRAPH 9 – MINIMUM RATE

This graph indicates the instances where the Council imposed a minimum rate.

Those Councils’ not included in the graph (i.e. Barossa, Mt Gambier, Port Pirie and Victor Harbor) elected to apply a Fixed Charge as part of their general rates instead of a minimum rate. A fixed charge is a fixed amount paid by each ratepayer, prior to the calculation of their general rate component which is determined by the property valuation multiplied by the rate-in-the dollar adopted by Council.

Gawler increased the minimum rate to $900 (which was a 4% increase from the 2014 amount of $866). This remain unchanged for the subsequent 2015/16 financial year.



22




23

DEBT COMPARISON



24


(1,265) (1,094)

(155)

3,226 3,740

4,932

5,922 6,040

6,794

10,335

(2,000)

-

2,000

4,000

6,000

8,000

10,000

12,000

MurrayBridge

Light Port Pirie Prospect Mt Gambier Mt Barker GAWLER WattleRange

VictorHarbor

Barossa

$'00

0s

COUNCIL

Graph 10 - Net Debt



25

GRAPH 10 – NET DEBT

This graph illustrates the net indebtedness of Councils, after allowing for Cash and Investments.

The graph illustrates the considerable financial divide that can exist between Councils. However, this does not necessarily translate to the fact that a Council with no/reduced debt is a ‘better performing’ Council overall. For example, their favourable net debt position may be hiding an under-investment in funding allocated towards asset replacement/renewal.

Movement in net debt for each Council for 2014 – 2015 is disclosed in the table below.

Council Net Debt 2014 $’000s Net Debt 2015 $’000s Movement $’000s Mt. Barker -4,036 4,932 8,968 Mt. Gambier 3,608 3,740 132 Prospect 3,760 3,226 -534Barossa 11,250 10,335 -915Gawler 7,393 5,922 -1,471Victor Harbor 9,458 6,794 -2,664Pt. Pirie 2,797 -155 -2,952Wattle Range 10,092 6,040 -4,948Murray Bridge 3,740 -1,265 -5,005Light Regional 6,940 -1,094 -8,034

Interestingly, 8 out of the 10 Councils reduced their net debt during the year.

Whilst net debt is a useful financial indicator, the more effective measure of a Councils’ overall financial position is the Net Financial Liabilities Ratio (refer Graph 12), which is a legislated financial indicator for the Local Government sector.



26




27

FINANCIAL INDICATORS



28


-7%

-4%

-2%-1%

0% 0% 0%

5%

7%

13%

-10%

-5%

0%

5%

10%

15%

Port Pirie Light Mt Gambier Barossa MurrayBridge

Mt Barker Prospect GAWLER VictorHarbor

WattleRange

COUNCIL

Graph 11 - Adjusted Operating Surplus / (Deficit) Ratio



29

GRAPH 11 – ADJUSTED OPERATING SURPLUS / (DEFICIT) RATIO

This ratio expresses the Operating result as a percentage of total rate revenue (general and other rates less NRM levy), after discounting advance payments of Federal Government Financial Assistance / Local Roads Grant.

For the 2014/15 financial year, 31 of the 68 Councils had an adjusted operating ratio less than 0 (i.e. recorded an operating deficit).



30


6%

16%17%

20%

24%

27%

37%39%

40%

44%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Light Mt Barker MurrayBridge

Port Pirie Prospect Mt Gambier WattleRange

VictorHarbor

Barossa GAWLER

COUNCIL

Graph 12 - Net Financial Liabilities Ratio



31

GRAPH 12 – NET FINANCIAL LIABILITIES RATIO

This graph illustrates the net financial liabilities of a Council as a percentage of its total operating revenue for the year, and thus is the most effective measure of a Council’s overall financial position.

The generally accepted industry position is that a Council’s net financial liabilities ratio should not exceed 100%, albeit this may be unavoidable (and indeed acceptable) in certain individual circumstances. However, the threshold should only be exceeded in instances where there is a strong longer-term strategic framework in place to reduce the ratio over time (e.g. by adoption of sound and robust plans, most importantly being the Infrastructure & Asset Management Plan and the Long Term Financial Plan).

Movement in the ratio result for each Council from 2014 to 2015 is disclosed in the table below.

Council Net Financial Liabilities Ratio 2014 2015

Light 48% 6% Mt. Barker 1% 16% Murray Bridge 26% 17% Port Pirie 35% 20% Prospect 21% 24% Mt. Gambier 31% 27% Wattle Range 66% 37% Victor Harbor 56% 39% Barossa 43% 40% Gawler 49% 44%

It is important to note that each Council may have completely different capital expenditure commitments from year to year (based on Asset Management Plans), thus the ratio result can potentially fluctuate on an annual basis.

The statewide total for 2015 was a ratio result of 30%. Only two Councils’ across the State (Copper Coast (103%) and Playford(101%)) exceeded the industry indicative ratio threshold of 100% in 2015.

Gawler’s ratio peaked at 86% in 2010/11, and has incrementally reduced ever since (the ratio result as at 30 June 2015 is 44%). Despite reducing the ratio result in half during this period, Gawler’s result for 2015 was still comparably high by comparison with all Councils across the State, with only 15 Councils having a ratio result greater than Gawler’s as at that date.

Light Regional’s ratio movement from 48% to 6% was heavily influenced by a $7.5m Federal Government grant received towards the Gawler Water Reuse Scheme - $6.7m of which was unspent as at the reporting date.



32


53% 53%58%

66%74%

84%89%

106%118%

230%

0%

50%

100%

150%

200%

250%

Mt Gambier MurrayBridge

VictorHarbor

GAWLER WattleRange

Light Port Pirie Mt Barker Prospect Barossa

COUNCIL

Graph 13 - Asset Sustainability Ratio



33

GRAPH 13 – ASSET SUSTAINABILITY RATIO

This graph illustrates whether existing assets are being replaced at the rate they are wearing out by comparing capital outlays on renewing/replacing existing assets (net of any proceeds from sale of replaced assets) to the amount of related expenditure required for such assets disclosed in the Infrastructure and Asset Management Plan.

The industry proposed target is that the percentage outlay should be between 90-110% over a rolling three year period.

The ratio result for each Council will fluctuate significantly from year to year based on the nature/programmed level of asset replacement/renewal undertaken.

In most instances, the focus for a Council (relative to its future capital works programs) should be on the replacement/renewal of existing assets as distinct from the purchase or construction of new assets. In this context, it is also important to note that the acquisition of new assets creates new recurrent operating costs (e.g. depreciation, insurance, maintenance costs, etc.) which subsequently adversely impacts on the operating position. Accordingly, it is important that such future costs are always taken into consideration when Council considers major budget bids that relate to the purchase and/or construction of new or upgraded assets.



1 ECM 642865

SA Local Government Sector Financial Indicators Report 2016

The LGA has assembled an updated report providing the latest values, history and comparisons of key financial indicators for the local government sector as a whole. The assistance of the SA Local Government Grants Commission, in providing data to help compile the following report, is appreciated.

Chart 1 below provides aggregate data from 2000-01 until 2014-15 covering the sector’s operating surplus/(deficit). This measures the difference between day-to-day operating income and expenses for a financial year and is considered to be the most critical measure of local government financial performance. The data in Chart 1 has been adjusted to remove the distortion otherwise caused by the five quarterly instalments of Commonwealth financial assistance grants received in the years 2008-09 and 2011-12, the two quarterly instalments received in 2013-14 and the six quarterly instalments received in 2014-15. The aggregate level of local government’s annual operating deficit reduced steadily from 2000-01 until 2007-08, when it was eliminated. Subsequently, an approximate ‘break-even’ operating result was recorded for five years up until 2012-13, with modest operating surpluses recorded for each of the past two years.

The operating surplus of $32 million in 2014-15 compares with an operating deficit of $75 million in 2000-01. A total of 32 councils recorded an operating surplus in 2014-15 compared with only 16 councils in 2000-01.

$m



ATTACHMENT 2

2 ECM 642865

Chart 2 below provides aggregate data from 2000-01 until 2014-15 covering the two key financial indicators endorsed by the sector in 2006. Again, the data in Chart 2 has been adjusted for the distortion otherwise caused by the timing of Commonwealth financial assistance grants received in 2008-09, 2011-12, 2013-14 and 2014-15. Data on an asset management performance indicator is included in Chart 6 at the end of this report.

Operating Surplus Ratio The operating surplus ratio shown in Chart 2 above is calculated as the percentage by which the annual operating surplus or deficit varies from total operating income.

The operating surplus ratio in 2014-15 was 1.6 per cent. This result compares with an operating surplus ratio of negative 8.3 per cent in 2000-01.

Chart 3 on the next page shows the differences in the operating surplus ratios between categories of councils recorded in 2014-15.



3 ECM 642865

Net Financial Liabilities Ratio Net financial liabilities represent the amount of money owed by councils to others less money held, invested or owed to councils. It is the most comprehensive measure of the indebtedness of a council as it includes items such as employee long service leave entitlements and other amounts payable as well as taking account of the level of a council’s cash and investments. After adjusting for the timing of financial assistance grants in 2014-15, the level of net financial liabilities at 30 June 2015 was $702 million which is very low when put in the context of local government infrastructure and other physical assets valued at $22.4 billion at 30 June 2015.



4 ECM 642865

The net financial liabilities ratio is a measure of the significance of the net amount owed at the end of a financial year compared with operating revenue for the year. The net financial liabilities ratio for the local government sector in 2014-15 was 34 per cent which compares with a figure of 36 per cent in 2000-01. Chart 4 above shows the differences in the net financial liabilities ratios between categories of councils recorded in 2014-15.

Provided operating deficits are avoided, there appears to be considerable scope for many councils to increase their level of borrowings (or liquidate some of their large stock of cash and investments, which is equivalent to borrowing) to finance capital expenditure, including for renewal or replacement of existing assets where a council’s Infrastructure and Asset Management Plan suggests that it is optimal to do so. Where a council is not achieving an underlying operating surplus or trending towards doing so in the medium term, then generally any capital expenditure on upgrading or expanding infrastructure needs to be modest and targeted, because it normally will lead to additional maintenance and depreciation costs.

Capital Investment Expenditure One of the findings of the LGA’s 2005 Financial Sustainability Inquiry was that capital investment expenditure on renewal and replacement of existing assets was significantly less than that needed to minimise whole-of-life-cycle costs of assets. Overall, capital expenditure in 2014-15 was a record high $643 million.

Chart 5 below shows the level of capital expenditure over the past ten years on renewal/replacement of existing assets on one hand and expenditure on new/upgraded assets on the other. Despite increased expenditure on renewing and replacing existing assets in most years, there continues a worrying trend in the level of capital expenditure on new/upgraded assets by some councils which currently are recording operating deficits.



5 ECM 642865

Asset Sustainability Ratio Data on an asset management performance indicator is available for 48 councils in 2014-15. Subject to the reliability of a council’s infrastructure and asset management plan, the asset sustainability ratio represents the level of capital expenditure on renewal and replacement of assets relative to the level of such expenditure identified as warranted in a council’s infrastructure and asset management plan.

The indicator is a measure of whether a council is accommodating asset renewal and replacement in an optimal and cost effective way from a timing perspective relative to the risk it is prepared to accept and the service levels it wishes to maintain. There may be operational and other reasons why the asset sustainability ratio result may vary between years. This may not necessarily detract from asset management performance if a council’s target is achieved over the medium term (e.g. over a rolling 3 or 5 year average). Chart 6 below provides summary information for the ratio covering 48 Councils in 2014-15.

Chart 6: Asset Sustainability Ratio (%): Summary results of the 48 Councils that calculated the Ratio in 2014-15

Differing Financial Performance of councils While this report demonstrates significant improvement over the past 14 years in the financial performance and position of the sector as a whole, it needs to be emphasised that the current financial condition of individual councils varies substantially. The overall sound and improving financial performance and position of the sector disguises the financially unsustainable performance of some councils under their existing revenue and expenditure policy settings.

In addition, in the absence at this stage of reliable data covering asset management performance in many, mainly rural, councils, it is not possible for those councils to quantify the extent of any annual shortfalls against the optimal level of capital expenditure on renewal and replacement of existing assets to provide desired and affordable service levels. The Financial Sustainability Inquiry asserted that the shortfalls in some councils had been large and persistent and would need to be addressed to avoid excessive rate increases and/or drastic reductions in services in the future.



Item 7.5 – 2015/2016 Audit Committee Workplan Update and Draft 2016/2017 Audit Committee Workplan

ATTACHMENT 1 2015/2016 Completed Audit Committee Workplan

ATTACHMENT 2 Draft 2016/2017 Audit Committee Workplan



AUDIT COMMITTEE2015/16 WORK PLAN UPDATE

ATTACHMENT 1

Action Motion Ref. Resp Officer Status Status Comments Oct Dec Feb April June

Monitor and report on internal controls

AC:2015:12:36AC:2016:06:23 Tony Amato Completed Internal Controls review report

2015/2016 tabled to June meeting.

Review annual LGA Mutual Liability Scheme Risk Management Review report

AC2015:10:20 Nathan Hall Completed The annual review report was tabled to the October 2015 meeting

Review progress reports received relating to Risk Management Improvement Action Plan

AC:2015:10:20AC:2016:02:03AC:2016:04:08

Nathan Hall Completed

Risk Management Review Data and Action Report 2015 tabled to October 2015 meeting. Risk Management Review Action Plan tabled to February and April 2016 meetings.

Oversee Council's relationship with external Auditors relative to matters raised within audit management letters received

AC:2015:12:41AC:2016:04:17 Tony Amato Completed Completed for 2015/2016

In-Camera Review with Auditors Tony Amato CompletedAn in-camera review with the Auditors was held at the 14 October 2015 Committee meeting.

Submit annual report of the Audit Committee's activities to the Council

AC:2015:12:33 Tony Amato CompletedThe 2014/2015 Audit Committee Annual Report was tabled to the December 2015 meeting.

Submit minutes of meetings to Council

Annette Ferrari Completed Minutes of meetings are tabled to

Council

1. Internal Controls & Risk Management Systems

2. External Audit

3. Reporting

4. Review of Strategic Documents




Attachment 1


Review of annual update to the Long Term Financial Plan AC:2016:06:22 Paul Horwood Completed

Workshop held with Committee Members prior to 11 February 2016 meeting. Draft Long Term Financial Plan 2015/2016-2024/2025 tabled to June 2016 Committee meeting.

Review of Draft Annual Budget / Business Plan AC:2016:06:21 Paul Horwood Completed

Council Workshops held 29 March 2016 and 18 April 2016. Report tabled at June 2016 meeting.

Review annual update to Infrastructure & Asset Management Plan (Long Term Capital Works Program)

AC:2016:06:19 Sam Dilena Completed

Report tabled to June 2016 Committee meeting. Proposed funding requirements have been incorporated within the Long Term Financial Plan.

Development of Service Level Policies AC:2015:10:23 Paul Horwood Completed

Service Level Policies for Parking Control, Records Management and Preventive Health Services were endorsed at the October 2015 meeting. No further action due to competing priorities.

Review Policy 6.4 - Treasury Management Policy AC:2015:12:34 Erin McGarry Completed

The Treasury Management Policy was reviewed at the 8 December 2015 meeting.

Review Policy 6.5 - Funding Policy AC:2015:12:34 Erin McGarry Completed The Funding Policy was reviewed at the 8 December 2015 meeting.

Review Policy 6.7 - National Competition Policy & Complaints Mechanism

AC:2015:12:34 Paul Horwood CompletedThe National Competition Policy & Complaints Mechanism was reviewed at the 8 December 2015 meeting.

Review Policy 6.10 - Rate Rebates Paul Horwood In Progress To be transferred to 2016/2017 Workplan

5. Policy Review




Attachment 1


Review Policy 2.8 - Prudential Management AC:2015:12:34 Tony Amato Completed

The Prudential Management Policy was reviewed at the 8 December 2015 meeting.

Review Policy 4.3 - Risk Management Policy AC:2016:02:03 Nathan Hall Completed

The Risk Management Policy was reviewed at the 11 February 2016 meeting.

Audit Committee Workplan - Progress report

AC:2015:10:26AC:2015:12:38AC:2015:12:39AC:2016:02:04AC:2016:04:09

Annette Ferrari Completed Completed for 2015/2016

Treasury Management Review AC:2015:10:27 Erin McGarry Completed The 2014/15 review was tabled to the October 2015 Committee meeting

Innovation, Efficiency & Effectiveness Program - Update reports

Paul Horwood In ProgressFinal report from consultant has since been received, which will be tabled to the next Committee meeting

Infrastructure Assets / Depreciation Expense Review Depreciation Methodology review, as a result of changes to Accounting Standard AASB116

AC:2016:02:05AC:2016:04:12 Tony Amato Completed

Review Audit Committee Terms of Reference AC:2016:02:02 Paul Horwood Completed

The Terms of Reference was reviewed at the 11 February 2016 meeting.

Review Debtor Analysis Report

AC:2015:10:28AC:2015:12:40AC:2016:02:06AC:2016:04:10

Joanne Glazbrook Completed

Tabled at meetings October, 2015, December 2015, February 2016, and April 2016.

7. Financial Reporting

6. Other




Attachment 1


Review Council Comparative Data Report AC:2015:10:24 Joanne

Glazbrook CompletedComparative Data (as at 30 June 2014) was tabled to the October 2015 Committee meeting

Review 2014/2015 Financial Statements

AC:2015:10:21 AC:2015:10:22 Erin McGarry Completed

The 2014/15 Financial Statements and a 2014/15 Financial Performance Summary report were tabled to the October 2015 Committee meeting.

Table Quarterly Budget ReviewAC:2015:12:37AC:2016:04:11AC:2016:06:20

Tony Amato CompletedQuarterly Budget Reviews tabled to December 2015 and April 2016 meetings.



AUDIT COMMITTEEDRAFT 2016/17 WORK PLAN

ATTACHMENT 2

Action Motion Ref. Resp Officer Status Status Comments Oct Feb April May

Monitor and report on internal controls Tony Amato On-going

Review annual LGA Mutual Liability Scheme Risk Management Review report

Nathan Hall In Progress Refer Agenda Item 7.1

Review progress reports received relating to Risk Management Improvement Action Plan

Nathan Hall On-going Refer Agenda Item 7.1

Internal Audit Strategic Risk Review AC:2015:06:23 Tony Amato Not Started

Jessica Kirk - Manager Risk Services, LGRS to attend meeting to discuss changes to Risk audit scoring and outline audit process for 2016/17 financial year.

Nathan Hall In Progress

Oversee Council's relationship with external Auditors relative to matters raised within audit management letters received

Tony Amato On-going Refer Agenda Item 9.1

In-Camera Review with Auditors

Tony Amato In Progress

An in-camera review will be held with the Auditors at a Confidential Workshop prior to the 5 October 2016 Committee meeting.

1. Internal Controls & Risk Management Systems

2. External Audit

3. Reporting




Attachment 2

Action Motion Ref. Resp Officer Status Status Comments Oct Feb April MaySubmit annual report of the Audit Committee's activities to the Council

Tony Amato In Progress Refer Item 7.8

Submit minutes of meetings to Council Annette Ferrari On-going Minutes of meetings are tabled to

Council

Review of annual update to the Long Term Financial Plan Paul Horwood Not Started 2017/2018

Review of Draft Annual Budget / Business Plan Paul Horwood Not Started 2017/2018


Sam Dilena Not Started 2017/2018

Development of Service Level Policies Paul Horwood On-going

Review Policy 2.5 - Audit and Control Policy Tony Amato In Progress

Review Policy 6.6 - Corporate Credit Card Policy Tony Amato In Progress

Review Policy 6.9 - Asset Capitalisation Policy Tony Amato In Progress

Review Policy 6.10 - Rate Rebates Paul Horwood In Progress

Review Policy 6.11 - Debtor Management Policy Tony Amato In Progress

4. Review of Strategic Documents

5. Policy Review




Attachment 2

Action Motion Ref. Resp Officer Status Status Comments Oct Feb April MayReview Policy 6.14 - Community Loans Policy Tony Amato In Progress

Audit Committee Workplan - Progress report Annette Ferrari On-going Refer Agenda Item 7.5

Treasury Management Review Erin McGarry Not Started

Innovation, Efficiency & Effectiveness Program - Update reports

Paul Horwood In ProgressFinal report from the consultant has been received and will be tabled to the Feb 2016 Committee meeting

Review Debtor Analysis Report Joanne Glazbrook On-going Refer Agenda Item 7.6

Review Council Comparative Data Report

Joanne Glazbrook In Progress Refer Item 7.4

Review 2015/2016 Financial Statements Erin McGarry In Progress Refer Item 7.2

Table Quarterly Budget ReviewTony Amato In Progress Reports to be tabled at end of

October, January and March.

7. Financial Reporting

6. Other



Item 7.7 – EBA Productivity Review (ASU & AWU) – 2015/2016

ATTACHMENT 1 EPA Productivity Review – 2015/2016



1/1 CR16 26834 05-10-2016 Audit Committee Item 7.7 - EBA Productivity Review -Attachment 1.XLSX 30/09/2016

Town of GawlerEfficiency & Effectiveness Savings Record

Trim Container: CC13/635; Trim Record: CR16/26834Time/

No Details of Savings Department Financial Originator Total Recurrent Quantity/ CommentsYear Amount Amount Quality/

$ $ Cost

1 Depot Operational Efficiencies Depot 2015/16 G Kerr 289,800$ 289,800$ CostContinued increase in operational efficiency where staff, on average, undertake 1 additional hour of productive work per day at the overhead cost rate of $45 per hour.

2 Depot Capital Project Efficiencies Depot 2015/16 G Kerr 260,387$ 260,387$ CostCapital works previously undertaken by external contractors now completed internally by Depot staff. These depot staff wages are now capitalised on projects approved in the 2015/16 Capital Budget.

3 Regional First Aid training provided by Town of Gawler staff to other Councils Town of Gawler 2015/16 N Hall 7,132$ 7,132$ Cost Regional training provided to other Councils by WHS / Risk Officer (Nathan

Hall)

4 WHS / LGAWCS Rebates Human Resources 2015/16 A Amato 45,895$ 45,895$ Quality LGAWCS, LGAMLS, LGAAMF Rebate distributions due to operational efficiencies and a reduction in claims.

5 Procurement savings - office stationery Procurement 2015/16 R Howard 3,150$ 3,150$ Cost Estimated cost savings from newly implemented regional procurement contract

6 Chemalert subscription Human Resources 2015/16 N Hall 900$ 900$ Cost Council subscription cancelled as now provided to Councils by LGA

7 Sharepoint design IT 2015/16 S Grigoriev 1,000$ 1,000$ Cost Enhancements in Sharepoint functionality allowed cancellation of Ninflex software licence

8 Rationalisation of Corporate Credit Cards Finance 2015/16 P Horwood 432$ 432$ Quantity Surplus corporate cards cancelled as a result of review undertaken9 Catering for internal Council Meetings Finance 2015/16 E McGarry 3,000$ 3,000$ Cost FBT savings from meals now consumed on Council premises

10 Aquatic Centre - Chemicals Aquatic Centre 2015/16 D Redmond 7,810$ 7,810$ Quantity / Cost

Savings from installation of automatic chemical controllers and renegotiation of chemical supply contracts

11 Aquatic Centre - Electricity Aquatic Centre 2015/16 D Redmond 6,033$ 6,033$ Quantity Savings from installation of new pumps and other capital works 12 Aquatic Centre - Gas Aquatic Centre 2015/16 D Redmond 692$ 692$ Quantity Savings from installation of new pool covers

Total Savings 626,231$ 626,231$



ATTACHMENT 1

Item 7.8 – Audit Committee 2015/2016 Annual Report

ATTACHMENT 1 Draft Audit Committee 2015/2016 Annual Report



TOWN OF GAWLER AUDIT COMMITTEE

2015-2016 ANNUAL REPORT

This report presents a summary of the Town of Gawler Audit Committee’s activities undertaken and recommendations made during the period 1 July 2015 to 30 June 2016.

Conduct of meetings

The Committee met on five (5) occasions during the reporting period, with the following attendance.

Date No. of Members attending

14 October 2015 5 8 December 2015 6 11 February 2016 5 13 April 2016 7 2 June 2016 4

Committee Member Member Attendances

Chairman – Mr. Peter Brass (Independent Member) 5 Mayor Karen Redman 4 Mr. Peter Fairlie-Jones (Deputy Chairperson and Independent Member)

5

Cr. David Hughes 4 Cr. Beverley Gidman 4 Cr. Paul Koch 3 Cr. Merilyn Nicolson 2

In accordance with Clause 6 of the Committee’s Terms of Reference (Frequency of Meetings), the Committee meets on a quarterly basis at appropriate times in the reporting and audit cycle, and as otherwise required by the Committee.

Committee Activities

The following table sets out the principal issues addressed by the Committee during the reporting period.



ATTACHMENT 1

Principal Issues Examined

Comment/Status Recommendations to Council

Quarterly Budget Reviews Each Quarterly Budget Review presented to Council is subsequently tabled to the Audit Committee for information purposes

N/A

2014/15 Financial Performance Summary

A report disclosing the final actual 2014/15 financial performance against the adopted budget for the year

That the report be noted

2014/15 Annual Financial Statements

Review of 2014/15 Annual Financial Statements (including a verbal ‘in-camera’ discussion with Council’s external auditors prior to the 14 October 2015 meeting)

That the report be received; Committee commended the operating result and the overall quality of the Annual Financial Statements

Draft 2016/17 Budget / Business Plan

The draft 2016/17 Budget / Business Plan was tabled for comment and review by the Committee

That the reports be received; No specific matters or concerns were raised relating to the draft document

Council Comparative Data Report (as at 30 June 2014)

The annual comparative data report was tabled to the October 2015 Committee Meeting.


Debtor Analysis Reports Provision of quarterly Debtor analysis reports

That the reports be noted

Annual update to Draft Long Term Financial Plan 2015/16 – 2024/25

The draft LTFP was tabled for comment and review by the Committee

That the Draft LTFP be noted


Report tabled. Proposed funding requirements incorporated within the Long Term Financial Plan.

That the report be noted.

Independent Infrastructure Assets Depreciation Review Report

Independent report tabled. That the report be noted

Full Cost Attribution Explanatory Report (effective 01/07/2015)

Report tabled. Requirement for financial reporting to be on a full cost attribution basis and the impact on financial data and statements.


Depreciation Methodology review, as a result of Accounting Standard AASB116

Removal of residual values for infrastructure assets in accordance with Australian Accounting Standards Board guidelines.


Monitor and Report on financial internal controls

Internal Controls review report 2015/2016 was tabled

That the report be noted. That a budget bid for an Independent Risk-based Internal Audit program be considered for the second half of the 2016/17 financial year.

Risk Management Improvement Action Plan Progress Reports

The 2015 annual Risk Management Review report from the LGA Mutual Liability Scheme was tabled to the Committee at the 14 October 2015 meeting. Subsequent meetings reported progress against the previous Risk Management Review Action Plan. Local Government Risk Services 2015 Scheme Highlights report tabled.

Risk Management Review Data and Action Plan progress reports and Scheme Highlights report to be noted.



Principal Issues Examined

Comment/Status Recommendations to Council

Gawler Connect Prudential Review Report

Independently researched Council Report tabled for information purposes.


External Auditor correspondence

Correspondence was received relating to: • Completion of Balance Date Audit

– financial year ended 30/6/15• Completion of External Audit:

provision of 2015 Auditor’s reportto Council

• External Audit ManagementReport January 2016 AuditAttendance – financial yearending 30/6/2016

That the correspondence be noted

Finance Policies Review Review of finance policies relating to ‘Treasury Management’, ‘Funding’, ‘National Competition Policy & Complaints Mechanism’, ‘Prudential Management’ and ‘Risk Management’. Review of ‘Rates Rebates’ policy is in progress.

That the reviewed policies be adopted

Service Level Policies Consideration of draft service level policies relating to ‘Records Management’, ‘Parking Control’ and ‘Preventative Health’ services

That the draft policies be adopted

EBA Productivity Review 2014/15

Productivity Review and Bonus Calculation Reports tabled


2014/15 Treasury Management review

A review of Council’s treasury management performance for the 2014/15 financial year


Local Government Association of SA correspondence

• Advice of the LGA FinancialSustainability Information Paper17 – Depreciation and RelatedIssues tabled.

• LGA Risk Services 2015 SchemeHighlights tabled

That the papers be noted.

Audit Committee Workplan Progress Reports

Reports monitor progress of actions identified in the Audit Committee Workplan

That the reports be noted.

Audit Committee Deputy Chairperson

The Audit Committee was required to appoint a Deputy Chairperson

That Mr Peter Fairlie-Jones be appointed until 22 November 2016

Review Audit Committee Terms of Reference

Reviewed by Committee. That the Terms of Reference be adopted.

Audit Committee Annual Report

Listing of all matters considered by the Audit Committee during the year




Chairperson’s Comments

It is increasingly obvious that the role of the Audit Committee is changing and Members are being asked to expand current thinking to match the rapidly expanding governance landscape.

I would like to acknowledge the professionalism and active participation of the Audit Committee during the reporting period. The level of discussion on matters brought before the Committee has been of a very high standard, which I believe has resulted in tangible benefits to the community and Council. The Committee has also greatly benefited from the contributions of the Mayor and Councillor Committee Members who bring significant local knowledge and local community experience to meetings.

I also wish to record my appreciation of the work undertaken by Council management and staff in supporting the work of the Committee including the commitment and involvement of Mr Henry Inat, Chief Executive Officer. I would also like to record my appreciation of the high standard of financial and internal control reporting provided to the Committee by Mr Paul Horwood, Manager Finance & Corporate Services and the dedicated Finance and Governance Teams.

The Audit Committee's activities for 2015-2016 summarises the work of the Committee for the year past and takes into account the increasing focus on assurances of internal controls and governance within Council and the role of the external auditor.



Item 9.1 – Dean Newbery & Partners – External Audit Management Report – May 2016 Attendance

ATTACHMENT 1 External Audit Management Report & Response – May2016 Attendance

ATTACHMENT 2 2015/2016 Balance Date External Audit Attendance &Requirements



1 | P a g e

Town of Gawler

External Audit Management Report

May 2016 Audit Attendance

Financial Year Ending 30 June 2016

Dean Newbery & Partners Chartered Accountants

214 Melbourne Street

North Adelaide SA 5006

www.deannewbery.com.au

P 08 8267 4777

E [email protected]



ATTACHMENT 1

2 | P a g e

Disclaimer: This document is for the exclusive use of the person/organisation named on the front of this

document (Town of Gawler). This document must not be relied upon by any person/organisation who is

not the Recipient. Dean Newbery & Partners Chartered Accountants does not take responsibility for any

loss, damage or injury caused by use, misuse or misinterpretation of the information in this document by

any person who is not the Recipient. This document may not be reproduced in whole or in part without

permission.

Liability limited by a scheme approved under Professional Standards Legislation

Dean Newbery & Partners

Chartered Accountants

214 Melbourne Street North Adelaide SA 5006



3 | P a g e

OUR REF: 128746_1

28 June 2016

Mayor Karen Redman

Town of Gawler

89 Murray Street

GAWLER SA 5118

Dear Mayor Redman

RE: External Audit Management Report - Financial Year Ending 30 June 2016

Our audit team recently undertook a site visit in relation to the external audit of your Council.

Our commentary and audit recommendations arising from our audit are outlined in this report. Please

note that all matters raised in this report have been discussed with the Administration prior to being

issued and responses provided by the Administration to audit matters raised have been included.

Please contact me on 8267 4777 ([email protected]) if you have any queries with regard to

our report.

Yours sincerely

DEAN NEWBERY & PARTNERS

SAMANTHA ALLARD

Partner

C. Chief Executive Officer

C. Audit Committee



External Audit Management Report - May 2016 Attendance

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Detailed Findings

Item Area Residual Risk

Rating

Comment and Audit Recommendations Management’s Response

1. Review/updates

to the Asset

Register –

Infrastructure

Assets

Moderate Council engaged Asset Engineering Pty Ltd to undertake core testing

and physical inspection of a sample of Council Road Infrastructure

network assets. The results of the core samples revealed

inconsistences with existing recorded technical asset data.

Examples of inconsistences identified were as follows:

• Kerbing assets in some segments were being double

counted.

• There were identified errors with the previously estimated

depths recorded for road components (e.g. seal and

pavement assets).

The financial impact of these identified inconsistences was yet to be

determined as at the time of our audit attendance. We recommend

Council’s Asset Register and Infrastructure Asset Management Plan

(IAMP) are updated to reflect the updated data collected.

We will monitor the progress made by the Administration in

addressing this matters during the Balance Date audit attendance to

be undertaken in September 2016.

Noted & agreed.

A detailed independent review of the

infrastructure assets has been undertaken

during the course of the 2015/16 financial

year. We have been advised by the

Engineering Department that all errors

identified and all adjustments required, in

particular those relating to the removal of

residual values, will be completed by 30 June

2016.

In addition, the accounting for assets

received free of charge from developers will

also be completed in the normal course of

events.




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Rating


2. Independent

Review of BAS

Returns

Moderate Audit testing identified there is no evidence of an independent

review of the Business Activity Statements (BAS) being retained on

file.

We recommend that all BASs be independently reviewed prior to

lodgment, and evidence of this review be always retained on file.

The BAS preparation process is performed

using a crystal report which extracts data

from, and interfaces directly with, the

Authority software.

The BAS lodgement process is electronically

completed via the ATO website.

Effective immediately from the date of your

most recent audit visit, the BAS process is

now independently reviewed by the Team

Leader Finance. Supporting signed

documentation is filed in both our electronic

Records Management database and within

the monthly general ledger reconciliations.




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Rating


3. Procurement –

Approval of

Variations

Moderate Discussions with Finance and Procurement staff indicated the

Council’s Administration does not currently maintain any

documented procedures relating to the required process for

financial variations to contracts (for both capital and operating

projects).

We are aware Council’s Administration was in the process of

updating the Procurement Policy (Policy Number 2.4) as at the time

of our attendance and this matter is an area to be addressed in the

updated policy.

We recommend the following matters (at minimum) should be

addressed in the updated policy:

• The review and approval process of all proposed project

variations to ensure that they are bona fide and within the

legal scope of the contract.

• The procedures and level of documentation required to be

retained internally within Council to formally document the

approval of the project variation.

• The personnel within Council who have the necessary

delegated authority to approve contract variations.

Noted and agreed.

The entire procurement framework is

currently being reviewed and updated by the

Team Leader Property & Procurement. This

will include the Procurement Policy, all

templates, forms and documentation as well

as the addition of new guidelines for

procurement procedures, including

variations.

It is envisaged that this review will be

completed by 31 December 2016 or earlier if

possible.

At the present time, variations are approved

in writing by the purchase order originator.

This procedure, however, will be revised to

include at least a one-up approval process.




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Rating


4. EFT Upload of

Bank File – to

make payroll

and creditor

payments

High In our External Audit Management Report issued 21 March 2016, we

provided the following comments;

It was noted that the bank file which is uploaded to the NAB

website as part of the Payroll and Accounts Payable functions is

not secured and can be manipulated after the relevant batches

have been authorised from the Authority finance system but

prior to the release of the funds from the bank.

This situation presents a weakness in controls over expenditure

where the payment details could be altered and a fraudulent

payment either not detected or detected many months after

the event.

During the recent audit visit we noted that a NAB Direct Link

software application had been purchased by the Council, however

the integration of this software and the Council’s Authority

corporate accounting system had not yet been implemented.

Given the High risk assessed against this weakness, the

implementation of this new control is important in addressing this

matter.

Noted & agreed.

Following earlier consideration of this

internal control weakness, we were advised

by NAB that their Direct Link product would

satisfactorily resolve this matter. The NAB

integration process has been successfully

completed.

Unfortunately, the Civica/Authority

integration process has proved to be

significantly more difficult. We are presently

in prolonged, but continuing, discussions

with Civica so that this integration process

can be finalised. This will then allow the NAB

Direct Link application to resolve this

internal control weakness (i.e. editable

transfer files).




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Rating


5. Business

Continuity &

Disaster

Recovery Plan

- We are pleased to note that a Business Continuity & Emergency

Management Plan has been developed and was adopted by

Council’s Leadership Group on 17 March 2016.

We remind Council of the importance of ensuring that appropriate

testing of key infrastructure and simulated events is formally

undertaken to ensure the documented procedures are reliable in

the event a disaster.

We also wish to highlight that in the event of any significant future

changes to the Council’s facilities (e.g. new buildings acquired during

the Gawler Connect project) a formal review/update of the Business

Continuity & Emergency Management Plan should be undertaken to

ensure all documented procedures remain up-to-date.

Noted & Agreed.



4 Dean Newbery & PartnersCHARTERED ACCOUNTANTS A B N 3 0 164612890

Town of GawJéOUR REF: 134541_1 Received

−7 JUL 20165 July 2016 I

M r Henry InatTown of Gawi~i

Chief Executive Officer I ScannedTown of Gawler

−89 Murray Street 7 JULGAWLER SA 5118

Recuid No......................

Dear Henry

RE: CONFIRMATION OF 2016 FINANCIAL YEAR BALANCE DATE EXTERNAL AUDIT ATTENDANCE

Our records show that your Council is scheduled to have the 2016 Balance Date audit attendanceconducted on the 9 − 12 September 2016. It is important that this agreed timetable is adhered to as far

as possible and if these agreed dates do change, we be given adequate advanced notice to ensure ourtravel arrangements can be amended if required.

Under S.127 o f the Local Government Act 1999, by Friday 9 September 2016, Council must prepare:

• financial statements and notes in accordance with standards prescribed by the regulations; and,

• other statements or documentation relating to the financial affairs o f the Council required by theRegulations.

We would appreciate being forwarded copy o f the draft financial statements for audit purposes as soonas they are available.

In preparation for our upcoming Balance Date audit attendance, the following information is expected tobe completed and made available for us at the commencement o f our audit:

Financial Statements and Reports

• Draft Financial Statements for the Financial Year Ended 30 June 2016— including all accompanyingNotes fully completed in the correct format of the SA Model Financial Statements and applicableAustralian Accounting Standards

• Final Trial Balance as at 30 June 2016 mapped to amounts disclosure in the Notes to the draftFinancial Statements

• Copy o f final adopted Council Budget for 2015/16 Financial Year

• Cash Flow Statement Worksheet

1

Office: All Correspondence: T. (08) 8267 4777214 Melbourne Street P 0 Box 755 F: (08) 8239 0895North Adelaide S A 5006 North Adelaide SA 5006 E: [email protected]

Liability limited by a scheme approved under Professional Standards Legislation

TOWN OF GAWLER AUDIT COMMITTEE MEETING

5 OCTOBER 2016

Page 199 of 202


ATTACHMENT 2

Cash At Bank and Bank Balances

• Access to Bank Reconciliation reports and appropriate supporting documentation for all bankaccounts held as at 30 June 2016

Receivables

• Supporting working papers verifying debtor balances recorded as at 30 June 2016 for all debtorscategories (i.e. Debtor's Trial Balance reports)

• List of all prepayments recorded as at 30 June 2016 including comparative amounts from 30 June2015

• List of all doubtful debts assessed as at 30 June 2016 and details of any debtors written−off. Pleaseinclude supporting documentation showing authorisation of debtor write−offs

• List of all accrued revenue recorded as at 30 June 2016 including comparative amounts from 30June 2015

Inventories

• Provide stock−take reports for all inventories accounted for as at 30 June 2016

Financial Assets

• Provide all schedules supporting balances recorded and any repayment schedules for loans to allCommunity Organisations that exist as at 30 June 2016

Equity Accounted Investments in Council Business

• Provide audited Financial Statements for all Subsidiary entities for the financial year ended 30June 2016

Infrastructure, Property, Plant and Equipment

• Provide fixed asset register for all reportable asset classes as at 30 June 2016

• Provide a reconciliation movement schedule for each reportable asset class reconciling thefollowing (in Excel if available)

• A schedule to be provided detailing all additions and disposals recorded for the financial year (tobe provided in Excel if available)

• Copies of independent valuation reports provided as part of asset valuations undertaken duringthe financial year (if undertaken)

• Reconciliation movement schedule of all Work in Progress projects undertaken during thefinancial year



Trade & Other Payables

• Aged Accounts Payable listing as at 30 June 2016 which reconciles to the General Ledger

• List of all accruals recorded as at 30 June 2016 which includes comparative amounts to 30 June2015

• Provide calculations, list of assumptions and estimates contained in calculating any accrualsrecorded where appropriate

• Reconciliation of final June 2016 BAS to General Ledger

Provisions

• Provide schedule of all Annual Leave and Long Service Leave liabilities as at 30 June 2016

• Details of any on−costs applied in calculations

• Provide schedules and reconciliation of calculations undertaken for any other Provisionscalculated as at 30 June 2016

Borrowings

• Loan repayment schedule for all loans outstanding as at 30 June 2016

Commitments and Contingencies

• List of all Capital and Other Expenditure Commitments as at 30 June 2016

• Details of all financing lease facilities available as at 30 June 2016

• List of all contingent liabilities known to the Council and/or Administration up to the date of auditsign−off on the Financial Statements.

In addition to the above, please provide all financial acquittals requiring external audit signoff to becompleted and provided with supporting evidence and working papers.

Should all of the above information not be available at the commencement of our attendance, this mayresult in a delay in finalising the audit in the agreed timeframes.

As is our customary practice, the following documents will be supplied electronically by us to the FinanceManager. These letters are an important audit requirement and form part of the audit evidence we requireto enable an Audit Opinion to be formed:

1. Management Representation Letter Template2. Solicitor's Representation Letter

We would be pleased if you could prepare the Management Representation Letter and provide us withthe original copy once your 2016 Financial Statements have been audited as well as providing yourCouncil's Audit Committee a copy of this representation to us.

3



We will require the completed Management Representation Letter be provided to us before we are ableto issue the annual Audit Opinion.

We ask that you prepare the Solicitor's Representation Letter and issue it direct to all of your legalrepresentatives, with a copy provided to your Council's Audit Committee and us.

Please forward a copy o f this letter to:

• Council's Audit Committee

• Council's Chief Financial Officer

Please feel free t o contact me t o discuss the above on 8267 4777 ([email protected]).

Yours sincerelyDEAN NEWBERY & PARTNERS

SAMANTHA ALLARDPartner

4

