2018–2019 annual report - city of tea tree gully...banksia park and new outdoor fitness equipment...

2018–2019 Annual Report

2018–2019 Annual Reportcttg.sa.gov.au

The City of Tea Tree Gully’s Annual Report 2018–2019 is provided to inform our community, visitors, government agencies and other interested people about our performance against Council’s 2018–2019 Annual Business Plan and Budget, as well as the outcomes and objectives of the Strategic Plan 2020.

This publication has been developed in compliance with the Local Government Act 1999 (SA) and provides a comprehensive and transparent account of our performance, achievements, challenges and financial management from 1 July 2018 to 30 June 2019.

For more information call 8397 7444 or visit cttg.sa.gov.au

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Reflecting on 2018–2019 – Message from the Mayor and the CEO 5Location 6–7City profile 8–9The year that was 10–13Strategic direction and achievements 14–18Targets for 2019–2020 19

Our Council 20–37Mayor and Elected Members 22–23Elector representation 24–26Decision-making structure 27–28Allowances and training 29–30Confidentiality provisions 30–35Internal review of Council decisions 36

Our organisation 38–45Organisational structure 40–41Staff profile 42–44

Our reporting 46–52Policies, registers and codes 48Freedom of information 49Competitive tendering arrangements 50–51Community land and Council facilities 51Development applications 52Local nuisance and littering complaints 52

Our finances 54–125Financial overview 56–57Annual Business Plan 2018–2019 performance 58–59Financial statements 60–111Council Solutions annual report and financial statements 112–158

Contents

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Council’s ongoing investment in the Modbury Precinct has helped create a platform for investment by major corporations.

Westfield Tea Tree Plaza’s new dining and entertainment precinct created 650 jobs during construction. Helping Hand opened its new multi-million-dollar aged-care home at Golden Grove. Work is also under way on a major upgrade of Modbury Hospital, while Resthaven has announced plans to develop aged-care services in Modbury.

A new Service Centre at Golden Grove, to serve as the base for Council’s outdoor workforce, fleet and equipment, is expected to open in late 2019. This will allow further operational efficiencies. Costs were offset with the sale of our St Agnes depot.

About $2.4 million was invested in installing synthetic soccer pitches at Richardson Reserve (Wynn Vale) and $1.6 million was spent on installing synthetic bowling greens at Modbury Bowls Club (Ridgehaven).

To ease congestion and improve public safety, 11.7 km of road improvements and 8.4 km of sealed footpaths were installed, while 1,800 street trees were also planted.

State-funded infrastructure and community projects, totalling $1.8 million, were completed, including the upgrade of tennis/netball courts at Banksia Park and new outdoor fitness equipment at Golden Fields Reserve at Golden Grove.

Our major events were attended by an estimated 101,000 people, up from 93,000 in 2017–2018. A crowd of around 40,000 attended Civic Park Carols, making it one of the leading carols events in Australia.

Across our recreation facilities about 100 sport and recreation programs were delivered weekly, while our library, arts centre, gallery and community centres offered around 1,000 programs and activities during the year.

Tea Tree Gully Library underwent significant technology upgrades to deliver a better customer experience and meet ongoing customer needs.

With an eye to environmental and financial outcomes, a 4.8% reduction in waste to landfill, in comparison to the previous financial year, was achieved largely through waste education and the use of Council-supplied kitchen caddies for disposal of household organic waste.

Through careful management, a $6.5 million budget surplus was achieved.

Following the November 2018 council elections, six new Elected Members were welcomed to Council, joining Mayor Kevin Knight and the six Elected Members who were re-elected.

Finally, we would like to pay tribute to all Elected Members, staff and volunteers who served this community during 2018–2019. Their hard work and commitment has enabled us to achieve much together.

A focus on building economic resilience through provision of key infrastructure projects has triggered jobs and housing growth within our City during the 2018–2019 financial year.

Reflecting on 2018–2019

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John Moyle – Chief Executive Officer

Kevin Knight – Mayor

City of Salisbury

City of Playford

City of Port Adelaide Enfield

Campbelltown City Council6

L ower North Eas t R oad

Golde

n Gr

ove R

oad

North E a st Road

Greenwith

GouldCreek

GoldenGrove

YatalaVale

FairviewPark

BanksiaPark

Tea TreeGully

VistaHoughton

Highbury

Dernancourt

HopeValley

HopeValley

St AgnesModbury

ModburyNorth

ModburyHeights

WynnVale

GulfviewHeights

GoldenGrove

SalisburyEast

Ridgehaven

SurreyDowns

HoldenHill

GillesPlains

Valley View

Paracombe

UpperHermitage

UpperHermitage

Redwood ParkLorem ipsum


Located less than 20 minutes north-east of Adelaide’s central business district, the City of Tea Tree Gully is one of Adelaide’s most desirable places to live, work and visit.

Adelaide Hills Council

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Adelaide

L ower North Eas t R oad

Golde

n Gr

ove R

oad

North E a st Road

Greenwith

GouldCreek

GoldenGrove

YatalaVale

FairviewPark

BanksiaPark

Tea TreeGully

VistaHoughton

Highbury

Dernancourt

HopeValley

HopeValley

St AgnesModbury

ModburyNorth

ModburyHeights

WynnVale

GulfviewHeights

GoldenGrove

SalisburyEast

Ridgehaven

SurreyDowns

HoldenHill

GillesPlains

Valley View

Paracombe

UpperHermitage

UpperHermitage


City profile

590 kmsealed roads

1,436 kmkerbs and gutters

541 kmsealed footpaths

95.7 kmunsealed footpaths

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40,070dwellings

9,521 hatotal land area

33%

66%rural area

urban area

606parks and reserves

1,305 haopen space

30,000street and reserve trees

120playgrounds

23.5%tree canopy cover

5,150registered businesses

$2.747 Bgross domestic product

2.5people per household (2016)


99,694residents

41 yearsmedian age

0–17 years (17.9%)18–34 years (25.2%)35–59 years (33%)60–84 years (21.5%)85+ years (2.1%)

23.9%of residents born

overseas

19.5%undertaking

voluntary work

50.3%with tertiary

qualifications

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65%of residents are

employed

4,200Mini Muncher kitchen

caddies distributed

40tonnes of paint

collected

1,014tonnes of waste

diverted from landfill101,000

attended major events and activations

172,000Waterworld attendances

36,000attended library services,

arts and culture events

767community development

programs delivered

15community

engagement activities

98recreation centre sporting

programs delivered weekly

The year that was

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1

2 3


1. Modbury beautification Streetscape upgrades were carried out – part of plans to boost economic growth, and visitor and resident appeal.

Total investment: $2.2 million.

Picture: North East Road (Modbury)

2. Community-inspired projects Nine projects, funded by the Government of South Australia, were completed.


Picture: New exercise equipment at Golden Fields (Golden Grove)

3. Playgrounds

Seven playgrounds were upgraded for families to enjoy, including new play equipment, seating and landscaping.

Total investment: $706,000.

Picture: Dalaston Reserve (Modbury)

4. Footpaths and roads 8.4 km of sealed footpaths were laid and improvements made to 11.7 km of road surface to make our community safer and more accessible.


Picture: Road reconstruction work

5. Waste management 4,200 Mini Muncher kitchen caddies were distributed to residents to encourage food-scrap recycling, which contributed to a 4.8% reduction in waste to landfill.

Total investment: $75,000 (co-funded with the Government of South Australia).

Picture: Local family using their Mini Muncher

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4

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6. Richardson Reserve Commenced stage 1 of a $6.51 million upgrade of Richardson Reserve (Wynn Vale). The three-year project includes construction of a synthetic playing field and a new clubroom facility for Modbury Vista Soccer Club.

Total investment: $6.51 million (partially offset through a $500,000 grant from the federal government’s SportAus Community Sport Infrastructure program and a $227,000 grant from the state government Local Infrastructure Partnership).

Picture: Richardson Reserve reconstruction

7. Events More than 100,000 people attended major events and activation events, including Civic Park Carols, Touch-A-Truck, Civic Park Movies and the Summer Garden Festival. Thank you to our sponsors, Channel 9, Tilt Renewables, Solo Resource Recovery, Fork on the Road, and Westfield Tea Tree Plaza.


Picture: Summer Garden Festival 2019.

8. Community programs More than 1,000 programs and activities designed to support community connectedness and wellbeing were offered at Tea Tree Gully Library, Golden Grove Arts Centre, Gallery 1855 and community centres.

Picture: Tai Chi at Surrey Downs Community Centre

9. Tea Tree Gully Library redesign A colourful facility and technology upgrade was completed to improve the customer experience and drive workplace efficiency.


Picture: Tea Tree Gully Library

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6

7

9


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Council uses a suite of strategic management plans to set its priorities and guide decision making and annual business planning, including budgeting.

Strategic direction and achievements

The Strategic Plan 2020 is the lead document in Council’s strategic planning framework. It articulates our vision and aspirations for the community – that is, everyone who lives in, works in or visits the City of Tea Tree Gully.

Community wellbeing is at the heart of the plan, which aims to build a healthy community that enjoys a quality lifestyle. The plan is structured around three strategic themes, each with its own objectives:

• Healthy and safe

• Prosperous and connected

• Vibrant and liveable.

To ensure that we have the flexibility to adjust to changing priorities and build our capacity, we have also developed a plan geared towards improving the way we do business. The Organisation Plan 2020 is structured around five themes:

• People and leadership

• Customer and community relations

• Finance and systems

• Governance

• Continuous improvement.

In working towards this vision, the 2018–2019 Annual Business Plan and Budget identified the key projects, programs and services that we anticipated would deliver on the aspirations and objectives identified in these plans.

The charts below illustrate how we are tracking against the key performance indicators for each theme outlined in our Strategic Plan and our Organisation Plan.

Strategic Plan 2020: Summary of progress 2018–2019

Organisation Plan 2020: Summary of progress 2018–2019

With the Strategic Plan 2020 reaching its conclusion, the draft Strategic Plan 2025 has been reviewed and is expected to be endorsed by December 2019.

Details relating to each theme are discussed on the following pages.

Healthy and safe

Prosperous and connected

Vibrant and liveable

Overall 95.8%

96.4%

98.9%

92.3%

People and leadership

Customer and community relations

Governance

Finance and systems 100.0%

97.0%

96.9%

95.6%

Continuous improvement 97.4%

Overall 97.4%

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Objectives1. A community where people are safe in our

public places and spaces.

2. A community where people are safe during emergencies, natural disasters and extreme climatic events, such as storms or heatwaves.

3. A community where people have easy access to places, spaces and services that support good health.

Achievement highlights• 67,000 square metres of road resealed to

improve safety and driveability

• 5 playgrounds upgraded

• 47 bus stops and 16 shelters upgraded to accessibility standards

• New lighting installed at Golden Fields Reserve, Wynn Vale Drive car park, Hope Valley Sporting Club and River Torrens Linear Park

• Synthetic greens installed at Modbury Bowling Club

A healthy community is one where people are happy and healthy, and have positive relationships. A safe community is one where people are safe at home and also when moving around in public places.

Healthy and safe

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Objectives1. A community that has a say in decisions that

affect them.

2. A community that participates in meaningful community and economic activities.

3. A community with a resilient local economy.

4. A community where people have the resources and capacity to achieve goals.

Achievement highlights• Community bus changed to a door-to-door

service to assist residents with difficulty accessing public transport

• 555 library events or programs held with combined 36,000 participants

• 477 business support sessions provided to Tea Tree Gully-based businesses

• 767 community development programs delivered

• Sponsorship of five successful community events to position our City as an events destination

In a prosperous community, people prosper as individuals and the local economy is thriving and resilient. This means people have access to diverse employment and educational opportunities, and local businesses are successful. A connected community is one where people have a sense of purpose about achieving their goals and where they feel a sense of belonging and connection to their local community.

Prosperous and connected

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Objectives1. A city that is made up of places and spaces

that are appealing and easy to access.

2. A community with a diverse range of housing to suit a variety of needs, life stages and lifestyles.

3. A sustainable city that has a healthy natural environment and is resilient to climate change.

4. A place that expresses a unique character and identity, an area that inspires pride in its residents and one that people enjoy visiting.

Achievement highlights• Civic Park Carols became one of Australia’s

leading carols events with an estimated crowd of 40,000 attending in 2018

• Tea Tree Gully Library upgraded, with a new entrance and carpet, plus new technology to improve customer service outcomes

• Streetscapes improved for North East and Smart roads in Modbury

• 8.4 km of paved footpaths and 3.9 km of unsealed footpaths constructed

• Successful trial on roads of asphalt containing recycled glass, plastics and printer cartridges

A liveable city is one where places and spaces are desirable, accessible and set in a healthy natural environment. It is also one that offers housing choices for people at all stages of life and provides transport options to help people to get around easily. A vibrant community is one that has a clear sense of identity and character; it is a place where people choose to live because they are proud of the area.

Vibrant and liveable

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People and leadershipOur people are engaged and make a meaningful contribution to organisational success.

Objectives1. Our values are role-modelled at all levels of the

organisation.

2. Our behaviours align with our values.

3. We understand our business needs and adapt accordingly.

4. Our leaders provide us with consistent and transparent direction, vision, purpose and mentoring.

5. We understand our role and the part we play in meeting the organisation’s goals.

6. We foster a safety culture where we place safety and wellbeing first in everything we do.

7. We take responsibility for giving and receiving information and sharing knowledge with others.

Customer and community relationsWe manage our customer relationships and analyse their requirements in order to deliver increasing value.

Objectives1. We build customer needs into the design and

delivery of services.

2. We ensure all contact has a customer focus.

3. We will deliver services in a way that enhances the customer experience.

4. We provide information that is relevant, current and meaningful, through accessible channels.

5. We show understanding, compassion and courtesy in customer interactions and communications.

GovernanceWe define the roles, powers and responsibilities within the organisation and strive to be a leader of good governance in local government.

Objectives1. Our people are empowered to make decisions.

2. The decision-making process is transparent and based on evidence.

3. We understand that risks exist and manage them for positive outcomes.

4. Our systems and processes are easy to follow and help our people with the decision-making process.

5. We work proactively to meet our legislative and governance obligations.

Finance and systemsWe use systems and data to show how well we are performing and as a basis for ongoing reviews and improvements.

Objectives1. We meet our financial commitments to the

community and organisation.

2. We allocate resources based on clear priorities.

3. Our systems are relevant, sustainable and meet our needs.

4. We collect and analyse useful data in order to aid in decision making.

Continuous improvementWe encourage innovation and improvement to ensure we continue to deliver value.

Objectives1. We look for new and better ways to improve

our processes.

2. We work with and learn from others in order to improve the way we work.

3. Improvements are focused on customer benefit.

4. We maximise benefits to staff and workplace efficiencies by using creative solutions.

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Targets for 2019–2020

The measure of our success is driven by the achievement of the objectives outlined in our Strategic Plan 2020 and our Organisation Plan 2020. A series of performance indicators have been developed to measure our progress against these objectives.

In addition to these indicators, we also use a number of financial measures to assess the achievements of our organisation, which are detailed in the Our Finances section of this report.

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Measures of success

Wellbeing indicators 2019–2020 targetOverall community wellbeing score 75%Resident satisfaction with their life as a whole 65%Resident satisfaction with how safe they feel 71%Resident satisfaction with feeling part of the community 46%Resident satisfaction with opportunities to have their say 57%Resident satisfaction with the provision of community centres, services and programs 68%Resident satisfaction with the provision of arts and cultural performances and activities 65%Resident satisfaction with Council-run major events 88%Resident satisfaction with library services 90%

Capital works indicatorsCapital works projects completed by 30 June 2020 90%Resident satisfaction with the provision of footpaths (local) 59%Resident satisfaction with the maintenance of footpaths 49%Resident satisfaction with the appearance of roadside verges 53%Resident satisfaction with the maintenance of street trees 55%Resident satisfaction with waste and collection services 93%Resident satisfaction with the control of litter and rubbish 74%

Customer service indicatorsOverall resident satisfaction with customer experience 70%Overall resident satisfaction with Council communications 75%Enquiry resolution at the first point of contact 65%


The roles of the Mayor and Elected Members are specified within the Local Government Act 1999, the legislation that provides the framework for councils to operate in South Australia.

Elected Members play a vital leadership role in representing the interests of the community and setting the vision and strategic direction of Council.

The City of Tea Tree Gully is divided into six wards and represented by the Mayor and 12 Elected Members, elected by the local community every four years.

Our Council

Balmoral WardCr Rob Unger0416 116 654 or [email protected]

Cr Olivia Savvas0437 767 523 or [email protected]

Pedare WardCr Brett Rankine0434 366 469 or [email protected]

Cr Bernie Keane0407 560 215 or [email protected]

Steventon WardCr Lucas Jones JP0425 411 618 or [email protected]

Cr Jessica Lintvelt0432 170 364 or [email protected]

Mayor and Elected Members

MayorKevin Knight0414 723 009 [email protected]

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Water Gully WardCr Robin Coleman0412 139 773 or [email protected]

Cr Peter Field0430 515 032 or [email protected]

Hillcott WardCr Alicia Schlueter8397 7444 or [email protected]

Cr Sandy Keane0419 850 779 or [email protected]

Drumminor WardCr Damian Wyld0402 751 889 or [email protected]

Cr Lyn Petrie0401 877 700 or [email protected]

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The Council as at 30 June 2019

Elector representation

For electoral purposes, the City of Tea Tree Gully is divided into six wards – each represented by two Elected Members.

When determining ward boundaries, Council must take into account the number of electors per ward as well as the growth of developing suburbs.

Other considerations include communities of interest, physical barriers (e.g. main roads) and historical factors.

In accordance with Section 12 of the Local Government Act 1999, Council commenced a periodic representation review in August 2016 to determine whether the community would benefit from an alteration to its composition or ward structure.

The review covered:

• Having a mayor or chairperson

• The need for wards and the adjustment of their boundaries and names, if applicable

• Number of elected members.

Sections 12, 26 and 33 of the Local Government Act 1999 set out the requirements and processes that councils are required to follow when undertaking an elector representation review, including providing opportunity for members of the public to make submissions at key stages of the review.

The review was completed in November 2017, with the outcome taking effect at the periodic Council election in November 2018.

The next review is scheduled for October 2024 to October 2025.

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City of Salisbury

City of Playford

City of Port Adelaide Enfield L ower North Eas t R oad

G olde

n Gr

ove R

oadNorth E a st R

oad

Greenwith

GouldCreek

GoldenGrove

YatalaVale

FairviewPark

BanksiaPark

Tea TreeGully

VistaHoughton

Highbury

Dernancourt

HopeValley

HopeValley

St AgnesModbury

ModburyNorth

ModburyHeights

WynnVale

GulfviewHeights

GoldenGrove

SalisburyEast

Ridgehaven

SurreyDowns

HoldenHill

GillesPlains

Valley View

Paracombe

UpperHermitage

UpperHermitage


Representation quotaThe representation quota for a council is determined by dividing the total number of electors for each Council, by the number of Elected Members that constitute the council.

The Mayor and 12 Elected Members represent a total of 72,633 electors across the City of Tea Tree Gully, with each of the 13 Elected Members

representing an average of 5,589 electors. This continues to be one of the highest numbers of electors per elected member of all 68 South Australian councils.

The table below compares the City of Tea Tree Gully’s representation quota with other comparable South Australian councils.

Council name

Number of elected members

Number of electors

Representation quota

Onkaparinga 13 123,939 9,533Salisbury 15 94,017 6,267Tea Tree Gully 13 72,663 5,589Charles Sturt 17 84,425 4,966Marion 13 64,219 4,939Port Adelaide Enfield 18 83,240 4,624Playford 16 60,775 3,798

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Balmoral Ward

Drumminor Ward

Hillcott Ward

Pedare Ward

Steventon Ward

Water Gully Ward

Periodic electionThe Local Government (Elections) Act 1999 provides for periodic elections to be held every four years under a non-compulsory postal voting system to determine the membership of Council.

The last election was held in November 2018. At the close of nominations for the City of Tea Tree Gully a total of 29 valid nominations had been received, resulting in an election for the mayoral position and for 12 elected members to represent all six wards.

The results of the 2018 periodic election are provided.

MayorKevin Knight ElectedPaul BarbaroBalmoral WardOlivia Savvas ElectedRob Unger ElectedAlexandra McGeeJames ElleryManinder DhillonAndrew FoordMarwa ShabbarDrumminor WardDamian Wyld ElectedLyn Petrie ElectedMatthew HarbinsonHillcott WardSandy Keane ElectedAlicia Schlueter ElectedPeter PanagarisKrystle MitchellPedare WardBrett Rankine ElectedBernie Keane ElectedGavin DentonPaul GriffinLeighton Arthur JacquesSteventon WardLucas Jones ElectedJessica Lintvelt ElectedAlda MattiskeBahar SalehiWater Gully WardPeter Field ElectedRobin Coleman ElectedLuke HarrisRobert Sanchez

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Decision-making structure

Council’s formal decision-making structure is made up of the Council and four committees established under Section 41 of the Local Government Act 1999, in addition to two other committees established under other legislation. All Section 41 committees report directly to Council.

Decisions made by Elected Members at these meetings provide direction for the ongoing operation of Council.

These meetings are open to the public and the documentation for each meeting (notice of meeting, agenda with reports, attachments and minutes) is published on our website.

This structure ensures that matters are dealt with objectively, fairly and in a timely manner.

A summary of the committees is given here. More information about their membership and relevant roles and functions can be found in the City of Tea Tree Gully Committee Structure – Terms of Reference and Membership documents on our website.

CouncilMembership Mayor and 12 Elected MembersTime Meets twice monthly on the

second and fourth Tuesday of the month (no meetings between 15 December and 15 January)

Focus • Committee recommendations, management reports and information reports

• Deputations, public forums and petitions

• Motions with/without notice and questions with/without notice

Audit CommitteeMembership Two Elected Members (including

Presiding Member) and three independent members

Time Meets on the last Wednesday of every second month beginning in January

Focus • Internal and external audit• Risk management and internal

controls• Financial management

Policy and Strategic Development CommitteeMembership Seven Elected Members

(including Presiding Member)Time Meets on the third Wednesday of

every second month, beginning in February

Focus • Development and review of key Council documents including policies and codes

• Strategic planning and development matters

CEO Performance and Remuneration Review CommitteeMembership Five Elected Members

(including Presiding Member)Time Meets as required each yearFocus • Review and management

of CEO’s performance and remuneration

• Assisting in recruitment of a CEO (where required).

Traffic Management Safety CommitteeMembership Four Elected Members

(including Presiding Member)and representatives from South Australia Police and the Department of Planning, Transport and Infrastructure

Time Meets on the first Wednesday of every second month beginning in February

Focus • Traffic matters

Council Assessment PanelMembership Four Independent Members

(including Presiding Member),one Elected Member and up to two Deputy Members

Time Meets monthlyFocus • Delegate of the Council in

accordance with the Planning, Development and Infrastructure Act 2016

Building Fire Safety CommitteeMembership A qualified staff member

(Presiding Member), a representative from SA Metropolitan Fire Service and specialist representatives as appointed by CEO

Time Meets as requiredFocus • Matters regarding fire safety of

buildings• Advice on scheduled building

fire safety inspections

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Allowances and training

AllowancesElected Members receive an annual allowance to assist with the cost of performing their duties.

These allowances are set by the independent Remuneration Tribunal of South Australia in accordance with the provisions of Section 76 of the Local Government Act 1999.

Elected Members may receive support in performing their duties as prescribed in the Local Government Act 1999 and Council’s Elected Member Support Policy. The policy, as well as a register that records all Elected Members’ allowances and support, is available to view on our website.

As at 30 October 2018, the Mayor was entitled to an annual allowance of $79,232. As at 30 June 2019, the Mayor is entitled to an annual allowance of $82,520. The Mayor has asked to receive less than the maximum allowance.

Other allowancesExternal independent members of two of Council’s committees are paid a sitting fee to attend meetings.

Audit Committee Allowance paidIndependent members $500 per meeting

Council Development Assessment Panel Allowance paidIndependent presiding member

$430 per meeting

Independent member $320 per meetingCouncil member $155 per meeting

Elected Member Allo

wan

ce p

aid

Ju

l–O

ct 2

018

Allo

wan

ce p

aid

No

v 20

18 –

Jun

201

9

Mayor Kevin Knight $21,562.77 $47,784.26Cr Stuart Headland $5,832.37Cr Mary Kasperski $5,832.37Cr Matthew Harbinson 1 $7,290.43Cr Damian Wyld 2, 3 $7,290.43 $16,031.82Cr Paul Barbaro $5,832.37Cr Sandy Keane $5,832.37 $12,825.47Cr Bernie Keane $5,832.37 $12,825.47Cr Lucas Jones 4 $7,290.43 $12,825.47Cr Chris McLafferty $5,832.37Cr Peter Field 5 $7,290.43 $16,031.82Cr Robin Coleman 6 $7,290.43 $16,031.82Cr Rob Unger $12,825.47Cr Olivia Savvas $12,825.47Cr Lyn Petrie $12,825.47Cr Alicia Schlueter $12,825.47Cr Brett Rankine $12,825.47Cr Jessica Lintvelt $12,825.47

1 Presiding Member of the Governance and Policy Committee, July to October 20182 Presiding Member of the Strategic Planning and Development Policy Committee, July to October 20183 Deputy Mayor and Presiding Member of Policy and Strategic Development Committee, November 2018 to June 20194 Deputy Mayor, July to October 20185 Presiding Member of the Audit Committee, July 2018 to June 20196 Presiding Member of the Traffic Management Safety Committee, July 2018 to June 2019* There were only 12 Elected Members from July to October 2018 due to a vacancy which occurred in March 2018

Development and trainingThe City of Tea Tree Gully is committed to providing training and development activities for Elected Members in accordance with the Elected Member Training and Development Policy.

During 2018–2019, the training and development program for Elected Members included the following professional learning opportunities, along with some relevant workshop discussion points (including Local Government Association Training Standards for Council Members mandatory training):

• Introduction to the City of Tea Tree Gully, e.g. media training, records management, strategies and plans, customer requests and complaints

• Council and Committee meetings

• Role of elected members and local government, e.g. mandatory training and legal responsibilities

• Emergency management

• Work Health & Safety training, including fair treatment, and child and vulnerable persons

• Financial management and reporting

• Strategic leadership

• Demographics

• Community engagement

• Precinct planning

• Community land

• City prosperity

• Community survey

• Asset management

• Local government conferences and seminars.

Council invested about $13,000 to provide this training and development.

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Confidentiality provisions

While Council and committee meetings are generally conducted in public, in the interest of the broader community it may be necessary to restrict public access to discussion and/or documents.

During 2018–2019, of the 450 agenda items, 24 were considered in accordance with Section 90(3) of the Local Government Act 1999, where it was necessary to exclude the public from the discussion of a particular matter. This represents

5.3% of all decisions made by Council and its committees.

The following table summarises the number of occasions that the provisions listed in Section 90(2) (excluding the public during debate) or Section 91(7) (documents to be kept confidential for a period of time) were used during the 2018–2019 financial year. The confidential status was current at 30 June 2019.


31

Date of meeting

Council / Committee

Subject matter

Section 90(2)

Section 90(3)

Section 91(7)

Confidentiality status

24 July 2018

Council Unsolicited proposal – request for lease of land in Ridgehaven

1 (d)(i)(ii) 0 No retention order

30 July 2018

CEO Performance and Remuneration Review Committee

Draft CEO Performance and Remuneration Review outcomes 2017–2018

1 (a) 1 Released on 26 September 2018

30 July 2018


Presentation – Draft CEO Performance and Remuneration Review outcomes 2017–2018


13 August 2018


CEO Performance and Remuneration Review outcomes 2017–2018


14 August 2018

Council C7171821 Receipt and processing of kerbside collected residual and hard waste – retention of documents

1 (d)(i)(ii) & (h)

1 Order remains

28 August 2018

Council Recommendations from the CEO Performance and Remuneration Review Committee meeting held on 13 August 2018


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Date of meeting

Council / Committee

Subject matter

Section 90(2)

Section 90(3)

Section 91(7)


29 August 2018

Special Meeting of Audit Committee

Presentation on audited financial statements for 2017–2018

1 (a) & (b)(i)(ii)

0 No retention order

11September 2018

Council Outcome of invitation for expression of interest for the Council depot at 118 Tolley Road, St Agnes

1 (b)(i)(ii) & (d)(i)(ii)

1 Order remains

11September 2018

Council Unsolicited proposal Pantowora Reserve, Hope Valley

1 (b)(i)(ii) & (d)(i)(ii)

1 Released on 14 May 2019

11September 2018

Council Richardson Reserve – Football Federation SA – Funding Agreement – proposal

1 (b)(i)(ii) 1 Released on 9 November 2018

11September 2018

Council Modbury Bowling Club upgrade

1 (k) 1 Released on 9 January 2019

25 September 2018

Council Sale of land for non-payment of Council rates

1 (a) 1 Order remains

23 October 2018

Council Deputy Independent Member for the Council Assessment Panel


12 December 2018

Special Meeting of Audit Committee

Recommendation for award of contract – provision of external audit services

1 (d)(i)(ii) 1 Released on 30 January 2019

22 January 2019

Council 2019 City of Tea Tree Gully Australia Day Awards

1 (a) 1 Released on 29 January 2019


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Date of meeting

Council / Committee

Subject matter

Section 90(2)

Section 90(3)

Section 91(7)


22 January 2019

Council Committee recommendation for award of contract – provision of external audit services

1 (b)(i)(ii) & (d)(i)(ii)

1 Released on 30 January 2019

26 February 2019

Council Sale of land for non-payment of Council rates


12 March 2019

Council Main Roads and Gateways – Smart Road (Reservoir Road to North East Road) construction contract for consideration

1 (k) 1 Released on 21 March 2019

26 March 2019

Council Unsolicited proposal – advertising

1 (d)(i)(ii) 1 Released on 10 July 2019

26 March 2019

Council Verge management contract – tender recommendation

1 (k) 1 Released on 8 April 2019

28 May 2019

Council Strategic property purchase

1 (b)(i)(ii) 1 Order remains

28 May 2019

Council Service Centre – budget, timeline and progress report

1 (b)(i)(ii) & (d)(i)(ii)

1 Order remains

25 June2019

Council Consideration of Council’s strategic procurement direction

1 (d)(i)(ii) 1 Order remains

Total orders 24 22

Section Description Total90(3)(a) information the disclosure of which would involve the unreasonable disclosure of

information concerning the personal affairs of any person (living or dead)9

90(3)(b) information the disclosure of which—(i) could reasonably be expected to confer a commercial advantage on a person with whom the council is conducting, or proposing to conduct, business, or to prejudice the commercial position of the council; and(ii) would, on balance, be contrary to the public interest

8

90(3)(c) information the disclosure of which would reveal a trade secret 090(3)(d) commercial information of a confidential nature (not being a trade secret) the

disclosure of which—(i) could reasonably be expected to prejudice the commercial position of the person who supplied the information, or to confer a commercial advantage on a third party; and(ii) would, on balance, be contrary to the public interest

10

90(3)(e) matters affecting the security of the council, members or employees of the council, or council property, or the safety of any person

0

90(3)(f) information the disclosure of which could reasonably be expected to prejudice the maintenance of law, including by affecting (or potentially affecting) the prevention, detection or investigation of a criminal offence, or the right to a fair trial

0

90(3)(g) matters that must be considered in confidence in order to ensure that the council does not breach any law, order or direction of a court or tribunal constituted by law, any duty of confidence, or other legal obligation or duty

0

90(3)(h) legal advice 190(3)(i) information relating to actual litigation, or litigation that the council or council

committee believes on reasonable grounds will take place, involving the council or an employee of the council

0

90(3)(j) information the disclosure of which—(i) would divulge information provided on a confidential basis by or to a Minister of the Crown, or another public authority or official (not being an employee of the council, or a person engaged by the council); and(ii) would, on balance, be contrary to the public interest

0

90(3)(k) tenders for the supply of goods, the provision of services or the carrying out of works

3

34

The following table identifies the grounds on which the Council considered the matters and determined to exclude the public from the discussion and the related documentation.

This differs from the total number of confidential orders as a number of confidential orders fell under more than one subparagraph of Section 90(3)(a)-(n).


35

A total of 17 confidential retention orders expired, ceased to apply or were revoked during 2018–2019 (including 13 orders which were made in 2018–19).

There were 16 confidential retention orders under Section 91(7) that remained operative as at

30 June 2019 (made after 15 November 2010). Of these, nine are listed in the above table, with the remaining seven operative as at 30 June 2019 listed below.

Date of meeting Council/committee Subject matter Section 90(3)12 December 2017 Council Unsolicited offer – receipt and

processing of waste contract (b)(i)(ii)

& (d)(i)(ii)28 November 2017 Council Tolley Road depot –

unsolicited offer to purchase(d)(i)(ii)

24 October 2017 Council Waste management services procurement

(b)(i)(ii) & (d)(i)(ii)

12 September 2017 Council Waste management procurement (d)(i)(ii)22 August 2017 Council Municipal waste disposal contract –

unsolicited offer(b)(i)(ii)

& (d)(i)(ii)12 August 2014 Council Sale of land for non-payment

of Council rates(a)

11 March 2014 Council Sale of land for non-payment of Council rates

(a)

Section Description Total90(3)(m) information relating to a proposed amendment to a Development Plan under the

Development Act 1993 before a Development Plan Amendment proposal relating to the amendment is released for public consultation under that Act

0

90(3)(n) information relevant to the review of a determination of a council under the Freedom of Information Act 1991

0

Total instances of 90(3) subparagraphs used 31

36

Internal review of Council decisions

The Local Government Act 1999 provides for any individual to ask for a review of a decision made by Council, its employees or other persons acting on behalf of the Council.

During the 2018–2019 period, Council received six applications for an internal review of a decision, as summarised in the table below.

The Internal Review of Council Decisions Policy is available on our website.

No. Subject matter Outcome1 Request for tree removal at Davenport

Street, Banksia ParkDecision upheld

2 Cutting of Council verges at Nursery Way, Highbury

Decision upheld

3 Installation of new footpath on Wicks Road, Highbury

Decision upheld

4 Request for tree removal at Kings Avenue, Golden Grove

Decision overturned (original decision was not incorrect – CEO used discretion to assess matter in accordance with relevant policy)

5 Council decision regarding community land revocation and purchase of a portion of Sir Frank Berryman Reserve, Modbury North

Review still in progress

6 Request for tree removal at Possingham Avenue, Redwood Park

Decision upheld


Our people are our greatest asset and are critical to achieving our vision for our City and community. We provide a safe and secure working environment and seek to develop our people and build on our service-based culture. Diversity and inclusion are encouraged, as is open, transparent and accountable decision making.

We’re a high-performing, progressive and dynamic organisation committed to making a positive difference in people’s lives through the provision of quality services and infrastructure.

Our organisation

Our organisational structure (refer to the diagram on opposite page) enables us to deliver varied and responsive services that meet the diverse needs of our community. Our organisation is structured into the following four portfolios, each led by an Executive Leadership Team member (Chief Executive Officer and three Directors):

• Office of the Chief Executive Officer

• Assets and Environment

• Organisational Services and Excellence

• Community and Cultural Development

Teams within each department perform specific functions, collaborate on projects and share their particular knowledge and expertise across the organisation.

Our Purpose and VisionDuring 2018–2019, we developed and communicated our organisational purpose and vision which are:

• Our purpose To make a positive difference in people’s lives.

• Our vision To work together, making a positive difference and adding value to our community.

Organisation Plan 2025Our Organisation Plan 2025 was developed during 2018–2019, and outlines the direction we, as an organisation, will be taking over the next five years to continue to develop a high-performing and values-based culture. The outcomes we are striving to achieve are grouped under four pillars:

• Customer care We are a high-performing, customer-focused organisation.

• Learning and growth We are a learning organisation where our people develop skills for their future and the community’s benefit.

• Future capability We build the capacity and capability of our people, the community and businesses through the continuous improvement of our services and operations.

• Sustainable operations Our management practices contribute to the long-term sustainability and adaptability of our services and operations.

Our valuesOur values underpin the culture of the organisation and guide the way we work and behave as individuals and as an organisation.

In 2018–2019, our values and behaviours were reviewed and updated to ensure they were accessible, memorable and reflected the way we work.

We will continue to embed the values and behaviours across the organisation in 2019–2020.

Organisational structure

40


41

Manager City Strategy

Ingrid Wilkshire

Manager City Development

Nathan Grainger

Manager Procurement and Contract Management

Sharon Hollamby

Manager Buildings, Assets and Environment

Mike Burke

Manager Governance and Policy

Ilona Cooper

Manager Community Development and Engagement

Carla Leversedge

Manager Organisational Development

Julie Short

Manager Civil Assets

Gabby D’Aloia

Manager Community Safety

Craig Hickman

Manager Finance and Operations

Justin Robbins

Manager Civil and Water Operations

Mark Konecny

Manager Library Services and Culture

Helen Kwaka

Manager Customer and Communications

Elissa Graves

Manager Parks

Andrew Sellars

Director Community and Cultural Development

Carol Neil

Director Organisational Services and Excellence

Ryan McMahon

Director Assets and Environment

Thornton Harfield

Chief Executive Officer

John Moyle

Manager Recreation and Leisure Services

Felicity Birch

Manager IT Solutions

Wayne Richards

Manager Strategic Assets

Andrew Craig

As at 30 June 2019, we employed 376 full-time equivalent (FTE) staff, with an additional 12 people filling casual positions across the organisation. Our paid workforce was supported by 432 volunteers.

We are committed to developing the skills and capability of our people for their future and the community’s benefit, and we are focused on continuously improving our services and operations.

The strategies that are outlined in this section have led to improvements in our culture and work environment, and are reflected in our low annual staff turnover – averaging 5.0% over the last three financial years.

As an employer, the City of Tea Tree Gully provides opportunities for staff to be part of a community-driven, high-performing, dynamic and progressive organisation.

Remuneration of executivesAs at 30 June 2019, the Executive Leadership Team consisted of the Chief Executive Officer and three directors with remuneration packages in the range of $227,500 to $282,000 per annum, including legislated Superannuation Guarantee contributions.

All executive team members are allocated two mobile devices, and the Chief Executive Officer also receives a fuel allowance, and one week’s additional annual leave as part of his remuneration package.

Organisational developmentDuring 2018–2019, we developed and commenced implementation of a new Organisational Development Plan to support the following Organisation Plan 2025 aspirations:

• Customer care – We are a high-performing, customer-focused organisation

• Learning and growth – We are a learning organisation where our people develop skills for their future and the community’s benefit

• Future capability – We build the capacity and capability of our people, the community and businesses through the continuous improvement of our services and operations

• Sustainable operations – Our management practices contribute to the long-term sustainability and adaptability of our services and operations.

Staff profile

42


The Organisational Development Plan includes a number of outcomes under the following key focus areas:

• High performing organisation• Health, safety and wellbeing• Learning organisation.

The following key initiatives were implemented during 2018–2019:

Leadership development• Our comprehensive management development

program continued to be delivered. In partnership with the University of Adelaide, a program on coaching, communication and providing feedback was undertaken by all managers.

• Masterclasses were held on our management operating framework and political awareness, and team leader forums on a number of leadership topics were well attended.

• The Executive Leadership Team undertook a 360-degree feedback leadership impact assessment, and the first group of managers commenced a 360-degree management impact assessment.

• Employees participated in a range of formal leadership development programs including the LG Professionals Management Challenge, LG Professionals Ignite Program and the Emerging Leaders Program.

• Our management operating tools and templates were comprehensively reviewed and improved.

Culture and performance• We developed an organisational purpose and

vision statement and reviewed our values and behaviours. We engaged with employees across the organisation to develop simplified and more

meaningful values and behaviours.

• We finalised the roll-out of our online performance management system and developed comprehensive performance management tools and guides for leaders and employees.

• We worked with leaders across the organisation to improve their role clarity through clearly documenting their responsibilities and accountabilities. This resulted in updated position description templates for all leaders.

Learning and development• We completed a training needs analysis for

all positions, including an analysis of training delivery methodologies. An organisation-wide training plan has been implemented with a focus on work health safety and wellbeing, as well as organisational core competencies including customer experience and digital literacy.

• Digital literacy training has been provided using online learning as well as face-to-face and individual support. Customer-experience training has been offered, as well as customised in-house programs for specific teams. Extensive training was also conducted on the new Customer First Solution.

• Two new online learning platforms with a suite of e-learning programs have been sourced for implementation to complement face-to-face delivery options and provide cost-effective training.

Wellbeing and diversity• A wellbeing program was launched with the

introduction of mental health first aiders in the workplace. We have trained 44 first aiders, who have been accredited by Mental Health First Aid

43

Australia to provide support to anyone at risk of developing a mental health problem, suffering an existing mental illness, or experiencing a mental health crisis.

• Wellbeing focus groups were held, and staff were surveyed to develop a wellbeing strategy and plan.

• Wellbeing and positive psychology training was delivered to a newly constituted Wellbeing Advisory Group, and Leading Wellbeing workshops were delivered to our managers.

• We are committed to creating a skilled and diverse working environment, where current and prospective employees receive fair and equitable treatment by applying the principles of merit, equity and fairness. We reviewed our recruitment practices to ensure that selection is based solely on merit, and according to the skills, aptitude, qualifications and experience required for each position. All new employees receive an overview of our Fair Treatment Policy as part of the induction process.

Work health and safetyWe delivered a number of WHS projects and initiatives aligned with our WHS Plan 2017–2020. These included the following key activities:

• Continued to implement our WHS Plan 2017–2020, which now includes four key programs, each with an executive sponsor.

• Implemented the Local Government Association Workers Compensation Scheme Evaluation Action Plan.

• Implemented an online contractor induction program with over 1400 contractors completing the module.

• Delivered the Executive, Managers, Supervisors and Team Leaders Safety Leadership Program.

• Implemented ICARE – a new online hazard and incident management system.

• Developed and implemented a work health and safety plan for our new Service Centre, ensuring that health and safety is integrated into its design, development and ongoing operation.

• Implemented a risk-based organisation-wide immunisation program.

• Performed skin cancer checks for over 120 staff who regularly work outdoors.

• Performed health checks for over 60 staff.

• Reviewed 80 percent of our WHS system documentation, including workplace emergency evacuation procedures, task risk assessments and safe work procedures.

• Conducted a broad range of WHS training programs/information sessions, including Strategic WHS Committee training, Whitecard training, First Attack Fire Fighting, a Workzone Traffic Management refresher, and health and safety representative training.

44


Council has a number of legislative obligations for corporate reporting. Our ethical, transparent and accountable reporting framework ensures future sustainability, effective use of resources, and that we meet our legal obligations.

Transparent and accountable governance underpins our business and demonstrates that we’re operating in the best interests of our community.

Our reporting

Policies, registers and codes

PoliciesAll City of Tea Tree Gully policies, including those required by legislation, are available on our website.

RegistersThe Local Government Act 1999 and the Local Government (Elections) Act 1999 require Council to establish various registers.

The City of Tea Tree Gully has established the following registers in accordance with the provisions of the relevant legislation.

• Community Land Register

• Confidential and Released Documents for Council and Committee Meetings Register

• Declaration of Interests Register for Council and Committee Meetings

• Delegations Register

• Elected Member Allowances and Benefits Register

• Elected Member Gifts Register

• Employee Gifts and Benefits Register

• Fees and Charges Register

• Register of Interests (Elected Members, Committee Members [where relevant], Staff [where relevant] and Council Assessment Panel members)

• Register of By-laws and Certified Copies. The City of Tea Tree Gully has the following by-laws:

• Permits and penalties

• Roads

• Local government land

• Dogs

• Moveable signs

• Waste management

• Register of Remuneration, Salaries and Benefits

• Road Register

• Voters roll

Note: Council does not have a Register of Building Upgrade Agreements as it has no such agreements in place.

CodesCodes of conduct or practice kept as required by the Local Government (Elections) Act 1999 and the Local Government Act 1999 include:

• Code of Conduct for Council Members

• Code of Practice – Access to Council and Committee Meetings and Documents

• Code of Practice for Meeting Procedures.

Other public documentsA number of other Council documents (including Council’s Annual Business Plan and Annual Report) are made available for public inspection at the Civic Centre in accordance with Section 132 and Schedule 5 of the Local Government Act 1999.

Many of these documents are available on our website.

48


Freedom of information

Applications received 2018–2019Total applications received 33Applications brought forward from the previous year 3Applications determined 29Applications transferred in full 0Applications withdrawn 4Lodgement by MP (no payment required) 8Lodged by concession (fees waived) 5Determination outcomesFull release 10Partial release 16Refused release 3Clauses and reasons for refusal referencedReason for restricted/refusal – exempt agencies 0Reason for restricted/refusal – record does not exist/documents not held 1Reason for restricted/refusal – incomplete 0Reason for restricted/refusal – unreasonable diversion of resources 0Reason for restricted/refusal – abuse of rights/purpose 1Reason for restricted/refusal – fees not paid/no payment received 1Reason for restricted/refusal – exempt 16Reason for restricted/refusal – documents otherwise accessible 0Internal reviewApplications for internal review 3Internal review determined 0Internal review withdrawn 0Internal review decision confirmed 3Internal review decision reversed 0Internal review decision varied 0External reviewApplications for external review 1

The Freedom of Information Act 1991 extends to every person the right to access information held by state and local government agencies.

To access information in accordance with the Freedom of Information Act 1991, a person must

submit an application clearly specifying the nature of the information required.

The City of Tea Tree Gully received 33 Freedom of Information applications during the 2018–2019 financial year.

49

Competitive tendering arrangements

In accordance with Australia’s National Competition Policy (Clause 7) requirements, Council can report as follows:

1. While Council was engaged in many negotiations for the provision of goods and services to the public for the 2018–2019 financial year, some of which were of a business nature, it was concluded that none of these could be regarded as significant.

2. In relation to the complaints procedure, implemented in compliance with National Competition Policy, we can report that Council does not have any complaints pending. When complaints are received, they are dealt with according to Council’s General Complaints Policy.

Procurement policyFor tendering and general procurement practices, Council has a Procurement Policy in place, which has been developed and adopted in accordance with Section 49 of the Local Government Act 1999.

This policy is underpinned by the following key procurement principles:

• Value for money

• Open and fair competition

• Professional integrity and probity

• Client service provision

• Management of risk

• Accountability

• Simplicity

• Local industry sourcing.

Twenty-one contracts were competitively tendered in accordance with Council’s Procurement Policy during the 2018–2019 financial year. These included contracts for plant, services, consultants,

maintenance, horticulture, construction and roadworks, with some works/services bundled into one competitive tender process.

All tenders are evaluated fairly, equitably and transparently, using Council’s adopted tender selection system to assess the quality of the tenderer and their ability to meet specification and performance requirements.

Where appropriate, and given an equal outcome of the evaluation process, preference is given to local companies over those based elsewhere in the state. In addition to our comprehensive tendering process, our Council’s policy provides guidance in relation to any requests for quotation for works/services valued at less than $100,000. The works are typically quoted on a competitive basis, with assessment criteria aligned to our Procurement Policy.

Council also participates in a number of regional procurement processes, including Council Solutions, Procurement Australia and Local Government Association Procurement (LGAP). These processes are governed by those organisations’ independent procurement policies.

During the year Council did not terminate any business dealings that are bound by competitive neutrality provisions. Competitive neutrality provisions and full-cost attribution continue to be applied to all business reviews as part of Council’s Continuous Improvement Program.

Council holds a monopoly business undertaking in providing Community Wastewater Management System (CWMS) services to more than 4,600 residents. This business is regulated under the Water Industry Act 2012.

50


Community land and Council facilities

Council has 633 reserves under its care classified as community land, including sporting hubs and community buildings, open space, playgrounds and reserve furniture, creek lines and drainage reserves, screening reserves and plantations.

The Local Government Act 1999 requires Council to prepare community land management plans.

First developed in 2004, these plans provide greater clarity and certainty to the community about the development and management of community land.

While no changes were made to the community land management plans in 2018–2019, a comprehensive review will be undertaken in 2019–2020.

Community land management plans are available on our website.

Community Land RegisterSection 207 of the Local Government Act 1999 requires Council to keep a register of all community land within its boundaries. This register is available on our website.

In 2018–2019, capital improvement works were carried out on a number of our properties. These are listed in our Annual Business Plan which is available on our website.

Facilities available for hire range from clubrooms and community halls to reserves and recreation centres. Most may be hired under a seasonal permit, casual hire application, or lease or licence arrangement.

Council has an endorsed Leases and Licences to Sporting and Community Organisations Policy. Currently there are 47 endorsed leases or licences to community groups and sporting clubs within the Council area.

By-laws reviewCouncil’s by-laws were reviewed in 2015 and the review considered competitive neutrality provisions. No changes were made in 2018–2019.

51

Local nuisance and littering complaints

The table below shows the number of complaints received under the Local Nuisance and Litter Control Act 2016 for the 2018–2019 financial year.

Litter NuisanceRegulation 5(a)Complaints of local nuisance or littering received by Council 54 135Regulation 5(b)(i) Offences under the Act that were expiated 4 2(ii) Offences under the Act that were prosecuted 0 0(iii) Nuisance abatement notices or litter abatement notices issued 0 4(iv) Civil penalties negotiated under Section 34 of the Act 0 0(v) Applications by the Council to the Court for orders for civil penalties under Section 34 of the Act And the number of orders made by the Court for those applications

0

0

0

0Regulation 5(c)Any other function performed by the Council under the Act 0 0

Development applications

Applications received in 2018–2019Total number of applications lodged 2,121Applications lodged include the following types:Planning, building rules only, staged, privately certified, combined, and land divisionTotal number of applications approved 1,792Number of applications refused 36Number of applications outstanding 125

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52


Achieving and maintaining financial sustainability is a key long-term objective. Financial sustainability enables the delivery of services and infrastructure to meet growing community needs. The financial statements included in this section provide information on the financial performance of Council.

We’re committed to strong and sustainable financial management.

Our finances

Council manages approximately $1.5 billion in assets. These assets include land, community buildings, library resources, recreation facilities, equipment, roads, footpaths, bridges, traffic control devices, stormwater drains and community wastewater management systems.

To maintain our City’s valuable assets and ensure continuous delivery of our services, Council collects revenue from ratepayers and receives some funding grants from both the Australian Government and the State Government of South Australia.

In setting annual rates, Council is always mindful of the need to keep rates affordable for householders and businesses.

Council’s annual budget is guided by the Financial Sustainability Policy and the Long-Term Financial Plan (LTFP) 2018–2028. Our LTFP is underpinned by five guiding principles. These are:

• Maintain assets at current service levels

• Continue to review assets, with proceeds of any sales reinvested into the community

• Maintain debt within the targeted range of 25–35% over the period of the LTFP

• Retain tight constraints on operating expenditure

• Ensure the capital works program includes a level of funding for new or unexpected projects.

The following information summarises our performance over the last financial year regarding our Financial Sustainability Policy.

Operating surplusAccording to our Financial Sustainability Policy, we should aim for our budget to be in surplus. Council recorded an operating surplus of $6.475 million before capital revenues for the 2018–2019 financial

year, compared to a surplus of $7.853 million in 2017–2018. Council has therefore met this financial goal.

Funding asset renewal and depreciationA key measure of whether or not a council is renewing or replacing its assets at the same rate that its overall stock of assets is wearing out is the asset sustainability ratio (ASR). This is calculated by measuring expenditure on renewal or replacement of assets relative to the recorded rate of asset depreciation for the same period.

Council aims to have capital outlay on renewing or replacing assets (net of proceeds from the sale of replaced assets) as greater than 90% but less than 110% of depreciation over a rolling three-year period. The ASR for the 2018–2019 year was 127%.

The ratio is higher than the target range primarily due to the renewal/replacement split of our Service Centre renewal project.

Debt limitationCouncil’s LTFP includes a goal to reduce existing debt over a period of three to five years. The net financial liabilities ratio (NFLR) is the key measure to test whether Council is achieving this reduction.

Net financial liabilities (NFL) are defined as total liabilities less financial assets (excluding equity-accounted investments in Council businesses).

The NFL result of $32 million (which gives an NLFR of 33.4%) for the end of financial year is within the Council’s LTFP target for NFLR of 25–35%. The increase compared to 2017–2018, is primarily the result of the planned capital expenditure associated with the new Service Centre, Richardson Reserve redevelopment and the strategic land purchase in the 2018–2019 year.

Financial overview

56


Review of assetsCouncil has continued to review its assets actively and continuously in line with planning objectives laid out in its Strategic Plan 2020, City Master Plan and infrastructure and asset-management plans.

Council rate increasesIn July 2012 Council adopted a differential rating system. This provides us with increased flexibility to moderate movements in valuations that occur periodically in the market and allows us to raise rates at different levels. It ensures that commercial and industrial sites continue to contribute appropriately to help fund Council services, regardless of property market fluctuations in those categories. Differential rates thus support economic development and capital growth.

In the 2018–2019 financial year, Council set a rate that covered the cost of existing service provision, both legislated and discretionary, and also costs projected in the LTFP and the adopted asset- management plans.

Further information on our rating system is included in our Annual Business Plan.

Financial statementsA copy of the City of Tea Tree Gully’s audited financial statements is provided with this Annual Report and is also published on our website.

Auditor remunerationThe remuneration payable to Council’s auditor for the annual audit of the financial statements was $26,000 (plus GST). No other remuneration was payable to the auditor for the 2018–2019 financial year.

57

Annual Business Plan 2018–2019 performance

Council adopted the Annual Business Plan 2018–2019 on 26 June 2018. This plan outlines goals for the financial year, including projections for services, programs and projects, our budget and changes to rates.

The following table summarises our financial performance in 2018–2019 compared with our original budget projections.

58


Indicators Formula

LGA suggested

rangeCouncil target

2018–2019

2017–2018

2016–2017

Operating surplus

Operating income less operating expenses

Break even or better over

5 years

Break even or better over

3 years

$6.475m $7.853m $7.703m

Adjusted operating surplus ratio

Operating surplus as a percentage of total operating revenue

0% – 15% 2.5% – 10% 5.5% 8% 7%

Net financial liabilities ratio including land held for sale

Total liabilities less financial assets divided by operating revenue

0% – 100% 25% – 35% 30.5% 20% 32%

Net financial liabilities including land held for sale


- - $29.2m $18.7m $27.8m

Net financial liabilities ratio excluding land held for sale


- - 33.4% 23% 32%

Net financial liabilities excluding land held for sale

Total liabilities less financial assets

- - $32m $21.5m $28.3m

Asset sustainability ratio

Expenditure on renewal and replacement of assets less disposal proceeds from replaced assets/depreciation expenses

90% – 110% over a rolling 3-year period

90% – 110% over a rolling 3-year period

127.2% 88% 103%

Fiscal balance Net lending position or net borrowing requirement in the uniform presentation of finances table

- - ($10.4m) $6.8m ($3.6m)

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Financial statements

60

City of Tea Tree Gully

General Purpose Financial Statements for the year ended 30 June 2019

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

46

48

page 1



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 June2019 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.

John Moyle Kevin KnightCHIEF EXECUTIVE OFFICER MAYOR

Date: 10 September 2019

X2A1T

page 2


Statement of Comprehensive Income for the year ended 30 June 2019

$ '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&E

Total Other Comprehensive Income

Total Comprehensive Income

1 Transferred to Statement of Changes in Equity

3d

7,908

11,528

2,756

404 108

84,698

1,662

92,551

7,853

910

337

994

95,825

-

35,166

3,480

95 99

6,475

89,350

31,291

4

28,555

216

9a 20,430

10,861 2h

17,027

2018

78,935 76,309

- 16

34,396 36,144

933 2,634

70

62

20,430 17,027

2,076

14,210

Notes

2a2b2c2g

2f

2019

3c

2e

3a37,430 3b

2d

19

2,896 4,106

14,782

7,585

19

2g 3,766

X3A0T

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


Statement of Financial Position as at 30 June 2019

$ '000

ASSETSCurrent AssetsCash and Cash EquivalentsTrade & Other ReceivablesInventoriesSubtotalNon-Current Assets Held for SaleTotal Current Assets

Non-Current 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

13,000

1,505,410

38,931

384,816

515 13,515

9b 4,385 1,116,209

1,505,410

6a7a

8b8c

Notes

15,564

76

5b2,773

9,227

2018

4,627 149

1,676

215

2,775 6,452

4,145

7,133 2,775

2019

1,268 3,734

1,095,779

507 5,861

6,368

27,777 1,474,119

373,318

1,489,285 3,308

1,501,896

1,492,669

9a

25,416

138

8c 3,991 5,861

8a8b

1,520,042

5c

5a

20

1,534,433

1,544,341

6b 14,253

9,908

1,474,119 5,022

16,407

21,409

X3A1T



Statement of Changes in Equity for the year ended 30 June 2019

AssetAccumulated Revaluation Other Total

$ '000 Notes Surplus Reserve Reserves Equity

2019Balance at the end of previous reporting period 373,318 1,095,779 5,022 1,474,119

a. Net Surplus / (Deficit) for Year 11,498 - (637) 10,861

b. Other Comprehensive Income- Gain (Loss) on Revaluation of I,PP&E 7a - 20,430 - 20,430 Other Comprehensive Income - 20,430 - 20,430

Total Comprehensive Income 11,498 20,430 (637) 31,291

Balance at the end of period 384,816 1,116,209 4,385 1,505,410

AssetAccumulated Revaluation Other Total

$ '000 Notes Surplus Reserve Reserves Equity

2018Balance at the end of previous reporting period 361,590 1,078,752 5,222 1,445,564

a. Net Surplus / (Deficit) for Year 11,728 - (200) 11,528

b. Other Comprehensive Income- Gain (Loss) on Revaluation of I,PP&E 7a - 17,027 - 17,027 Other Comprehensive Income - 17,027 - 17,027

Total Comprehensive Income 11,728 17,027 (200) 28,555

Balance at the end of period 373,318 1,095,779 5,022 1,474,119

X4A0T



Statement of Cash Flows for the year ended 30 June 2019

$ '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 AssetsSale of Surplus AssetsPaymentsExpenditure on Renewal/Replacement of AssetsExpenditure on New/Upgraded Assets

Net Cash provided by (or used in) Investing Activities

Cash Flows from Financing ActivitiesReceiptsProceeds from BorrowingsProceeds 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 2,773 1,676

11,717 (8,383)

1,097 (1,554)

11 1,676 3,230

(15) - - (8,419)

- 36

(31,668) (15,319)

11,732 -

(19,881) (13,054) (16,634) (5,891)

3 510

3,766 2,634 1,078 482

(994) (910)

11b 21,048 22,148

(78,805) (75,794)

95 99

Notes 2019 2018

100,752 98,753

X5A0T



Notes to and forming part of the Financial Statements for the year ended 30 June 2019

Contents of the Notes accompanying the Financial Statements

Details

Significant Accounting PoliciesIncomeExpensesAsset Disposal & Fair Value AdjustmentsCurrent AssetsCash & Cash EquivalentsTrade & Other ReceivablesInventoriesNon-Current AssetsEquity Accounted Investments in Council's BusinessesOther Non-Current AssetsFixed AssetsInfrastructure, Property, Plant & EquipmentInvestment PropertyValuation 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 Operations

Events After the Statement of Financial Position DateRelated Party Transactions

n/a - not applicable

5b 185c 18

7a (ii) 20 n/a7b 21

6a 196b

8c

8a

1011

25

269b 269a

27 n/a27

258b

16

42

40

29

35

30

12a

1514

17

1312b

1918

34

30

39

41

1

Note

7a (i)

43

18

18

20

5a

8

19

2 1416

43

Page

25

44

20

21

2223

Contingencies & Assets/Liabilities Not Recognised in the Statement of Financial Position 43

44

X6A0T

page 7

_



Note 1. Summary of Significant Accounting Policies

page 8

The principal accounting policies adopted by Council in the preparation of these 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 on a going concern basis using the historical cost convention 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 10 September 2019.

AASB 15 Revenue from Contracts with Customers, AASB 1058 Income of Not-for-Profit Entities and AASB 2016-8 Amendments to Australian Accounting Standards - Australian Implementation Guidance for Not-for-Profit Entities has been fully adopted in this and last years financial reports.

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.

The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are specifically referred to in the relevant sections of these Notes.

1.4 Rounding

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

2 The Local Government Reporting Entity

City of Tea Tree Gully is incorporated under the South Australian Local Government Act 1999 and has its principal place of business at 571 Montague Road, Modbury. 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

2016/17 $4,630,200 $3,055,714 $1,574,486 2017/18 $3,843,110 $3,140,183 $702,927 2018/19 $4,952,699 $3,790,010 $1,162,689

2011 dated 10 September 2019.

_



Note 1. Summary of Significant Accounting Policies (continued)

page 9

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.

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 stores have been valued by using the weighted average cost on a continual basis, after adjustment for loss of service potential. Inventories held in respect of business undertakings have been valued at the lower of cost and net realisable value.

5.1 Real Estate Assets Developments

Real Estate Assets developments have been classified as Inventory in accordance with AASB 102 and are valued at the lower of cost or net realisable value. Cost includes the costs of acquisition, development, borrowing and other costs incurred on

financing of that acquisition and up to the time of sale. Any amount by which cost exceeds the net realisable value has been recognised as an expense.

Revenues arising from the sale of property are recognised in the operating statement when settlement is completed.

5.2 Other Real Estate Held for Resale

Properties not acquired for development, but which Council has decided to sell as surplus to requirements, are recognised at the market value at the time of that decision.

Certain properties, auctioned for non-payment of rates in accordance with the Local Government Act but which failed to meet the reserve set by Council and are available for sale by private treaty, are recorded at the lower of the unpaid rates and charges at the time of auction or the reserve set by Council. Holding costs in relation to these properties are recognised as an expense when incurred but added to the outstanding rate payable accounts as a debtor.

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

_




page 10

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 $3,000 Fleet and Plant $3,000 Buildings - new construction/extensions $5,000 Information Technology $1,000

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 7.

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.

Plant, Furniture & Equipment Office Equipment 3 to 10 years Office Furniture 4 to 20 years

Building & Other Structures Footings 60 to 150 years Envelope 45 to 150 years Fitout - Flooring 15 to 35 years

Fitout - Internal 30 to 100 years Roof 10 to 100 years Mechanical Services 15 to 40 years Fire Services 40 years Hydraulics 50 to 150 years Electrical 50 to 150 years

Infrastructure Road – Formation Indefinite Road – Pavement 40 to 250 years Road – Seal 15 to 60 years Kerb and Gutter 80 to 200 years Footpaths 15 to 200 years Bridges 30 to 250 years Traffic Control 40 to 150 years Stormwater 50 to 200 years CWMS 60 to 200 years

Other Assets

Wetlands 100 to 200 years Irrigation Systems 25 to 40 years Public Lighting 33 to 60 years Playing Courts 10 to 200 years Playgrounds 20 to 65 years

6.5 Impairment

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, are not subject to impairment testing.

Other 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).

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.

6.6 Borrowing Costs

Borrowing costs in relation to qualifying assets (net of offsetting investment revenue) have been capitalised in accordance with AASB 123 “Borrowing Costs”. The amounts of borrowing costs recognised as an expense or as part of the carrying amount of

_




page 11

qualifying assets are disclosed in Note 3, and the amount (if any) of interest revenue offset against borrowing costs in Note 2.

7 Investment property

Investment property comprises land &/or buildings that are principally held for long-term rental yields, capital gains or both that is not occupied by Council.

Our Council does not presently hold any properties that it considers investment properties.

8 Payables

8.1 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.

8.2 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.

9 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”.

10 Employee Benefits

10.1 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 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 4.31% (2018, 4.5%)

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. In addition Council holds an Income Protection Insurance policy that covers long term sick leave absences for employees.

10.2 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.

11 Provisions for Reinstatement, Restoration and Rehabilitation

Close down and restoration costs include the dismantling and demolition of infrastructure and the removal of residual materials and remediation and rehabilitation of disturbed areas. Estimated close down and restoration costs are provided for in the accounting period when the obligation arising from the related disturbance occurs and are carried at the net present value of estimated future costs.

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page 12

Although estimated future costs are based on a closure plan, such plans are based on current environmental requirements which may change. Council’s policy to maximise recycling is extending the operational life of these facilities, and significant uncertainty exists in the estimation of the future closure date.

12 Leases

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

In respect of finance leases, where Council substantially carries all of the risks incident 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 incident to ownership of the leased items, lease payments are charged to expense over the lease term.

13 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 set out in detail in Note 19.

14 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.

15 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.

City of Tea Tree Gully has not applied any Australian Accounting Standards and Interpretations that have been issued but are not yet effective.

AASB 7 Financial Instruments - Disclosures and AASB 9 Financial Instruments commenced from 1 July 2018 and have the effect that non-contractual receivables (e.g. rates & charges) are now treated as financial instruments. Although the disclosures made in Note 13 Financial Instruments have changed, there are no changes to the amounts disclosed.

AASB 16 Leases, which will commence from 1 July 2019, requires that the right of use conveyed by leasing contracts - except leases with a maximum term of 12 months and leases for non-material amounts - be recognised as a form of Infrastructure, Property, Plant and Equipment, and that the lease liability be disclosed as a liability. At 30 June 2019, Council has no leases to which this treatment will need to be applied.

Some Australian Accounting Standards and Interpretations have been issued but are not yet effective. Those standards have not been applied in these financial statements. Council will implement them when they are effective.

The standards that are expected to have a material impact upon Council's future financial statements are:

Effective for annual reporting periods beginning on or after 1 July 2019

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page 13

Peppercorn Leases Council is the leasee of a number of Deed of Grant in Trust leases, for which no or little lease payments are made. These have been identified as peppercorn leases which are currently not recognised in Council's financial statements. Council does not intend to elect not to apply the fair value measurement requirements to these leases until such time as this requirement is mandated.

The following list identifies all the new and amended Australian Accounting Standards, and Interpretation, that were issued but not yet effective at the time of compiling these illustrative statements.

The standards are not expected to have a material impact upon Council's future financial statements are:

Effective for annual reporting periods beginning on or after 1 January 2019

AASB 16 Leases

AASB 16 Leases (Appendix D)

AASB 2016-8 Amendments to AustralianAccounting Standards - AustralianImplementation Guidance for Not-for-ProfitEntities

AASB 2017-1 Amendments to AustralianAccounting Standards - Transfers of InvestmentProperty, Annual Improvements 2014-2016Cycle and Other Amendments

AASB 2017-4 Amendments to AustralianAccounting Standards – Uncertainty over IncomeTax Treatments

AASB 2017-6 Amendments to AustralianAccounting Standards – Prepayment Featureswith Negative Compensation

AASB 2017-7 Amendments to AustralianAccounting Standards – Long-term Interests inAssociates and Joint Ventures

AASB 2018-1 Amendments to AustralianAccounting Standards – Annual Improvements2015–2017 Cycle

AASB 2018-2 Amendments to AustralianAccounting Standards – Plan Amendment,Curtailment or Settlement

AASB 2018-3 Amendments to AustralianAccounting Standards – Reduced DisclosureRequirements

AASB 2018-4 Amendments to AustralianAccounting Standards – AustralianImplementation Guidance for Not-for-ProfitPublic Sector Licensors

AASB 2018-5 Amendments to AustralianAccounting Standards - Deferral of AASB 1059

Effective for annual reporting periods beginning on or after 1 January 2021

AASB 17 Insurance Contracts

AASB 17 Insurance Contracts (Appendix D)

16 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.

17 Disclaimer

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



Note 2. Income

$ '000

(a). Rates Revenues

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

Other Rates (Including Service Charges)Natural Resource Management LevyCommunity Wastewater Management SystemsTotal Other Rates

Total Rates Revenues

(b). Statutory Charges

Development Act FeesAnimal Registration Fees & FinesParking Fines / Expiation FeesOther Licences, Fees & FinesTotal Statutory Charges

(c). User Charges

SundryAdmission Fees, Cemeteries and RentsCanteen IncomeBus Charter IncomeTotal User Charges

(d). Investment Income

Interest on Investments- Local Government Finance Authority- Banks & OtherTotal Investment Income

3,258

- 36

61 63

365 298

439 393 44 40

74,394

1,800

78,935

4,541

945

2018Notes

71,916

1,700

75,742

2019

(1,306)

2,741 2,693 4,393

(1,348) 73,222

2,896

76,309

827 868

1,007

2,756

95 99

34 -

4,106 3,480

2,749

1,173 62 54

716

X8A0T

X8A1T

X8A2T

X8A4T

X8A19T

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Note 2. Income (continued)

$ '000

(e). Reimbursements

RoadworksOtherTotal Reimbursements

(f). Other Income

Insurance & Other Recoupments - Infrastructure, IPP&ERebates ReceivedSundryOtherTotal Other Income

(g). Grants, Subsidies, Contributions

Amounts Received Specifically for New or Upgraded AssetsOther Grants, Subsidies and ContributionsTotal Grants, Subsidies, Contributions

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

(i) Sources of grantsCommonwealth GovernmentState GovernmentOtherTotal

(h). Physical Resources Received Free of Charge

Land & ImprovementsLibrary MaterialsTotal Physical Resources Received Free of Charge

Notes 2019 2018

70

5,204 6,764 3,425 2,830

7,585 7,908 3,766

152

10,542 11,351

2,722 948

216 933

285

189 197

70

2,634

2,076

528 467 998

337

1,317

52

216

42 -

11,351 10,542

1,662

- 781

-

X8A3T

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X8A6T

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Note 3. Expenses

$ '000

(a). Employee Costs

Salaries and WagesEmployee Leave ExpenseSuperannuation - Defined Contribution Plan ContributionsSuperannuation - Defined Benefit Plan ContributionsWorkers' Compensation InsuranceLess: Capitalised and Distributed CostsTotal Operating Employee Costs

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

(b). Materials, Contracts and Other Expenses

(i) Prescribed ExpensesAuditor's Remuneration- Auditing the Financial ReportsBad and Doubtful DebtsElected Members' ExpensesElection ExpensesOperating Lease Rentals - Non-Cancellable Leases- Minimum Lease Payments

Subtotal - Prescribed Expenses

(ii) Other Materials, Contracts and ExpensesContractorsContractors - WasteContractors - Consultants FeesAdvertisingEnergyFringe BenefitsInsuranceLicence FeesLegal ExpensesLevies Paid to Government - NRM levyLevies - OtherParts, Accessories & ConsumablesSundrySubtotal - Other Material, Contracts & Expenses

Total Materials, Contracts and Other Expenses

1,663

388

17

34,396

388

35,166

26 451 290

28

36,144

2,103 1,996

Notes 2019 2018

3,333 28,194

3,787

284

29,425

181,442 1,411

1,105

331 320

5,893 5,492

1,181

13,554 12,825

403 65

725

165 142

991

7,956

34,409 36,188 324 251

764

(1,496) (1,408)

31 54

320 1,762

2,968 2,803

37,430

18883 870

1,242 757

127

39 53

7,873

110

1,227

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Note 3. Expenses (continued)

$ '000

(c). Depreciation, Amortisation and Impairment

(i) Depreciation and AmortisationBuildings & Other StructuresInfrastructure- Stormwater Drainage- Roads- Footpaths- Bridges- Traffic Control Devices- Community Wastewater Management- LightingPlant & EquipmentFurniture & FittingsLibrary BooksTechnologyPlayground EquipmentIrrigation SystemsFencing and Other LandscapingSporting Courts, FacilitiesPlaying Field FormationCarpark FacilitiesSubtotal

Total Depreciation, Amortisation and Impairment

(d). Finance Costs

Interest on LoansBank Fees & Other Finance ChargesTotal Finance Costs

1,733

555 515 355

1,735

Notes 2019 2018

88

2,112 2,040

433 204

827

1,648 1,615

181

4,590 730 685

4,625

21 28

232 456

481 483

549

87

104 97 351

14,782 14,210

52 50

412 408

378

-

182

168 160

14,782

-

14,210

616 683

994 910 227

X8A9T

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Note 4. Asset Disposal & Fair Value Adjustments

$ '000

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 SoldLess: Other Amounts Relating to the Sale of Surplus AssetsGain (Loss) on Disposal

Net Gain (Loss) on Disposal or Revaluation of Assets

Note 5. Current Assets

(a). Cash & Cash Equivalents

Cash on Hand at BankTotal Cash & Cash Equivalents

(b). Trade & Other Receivables

Rates - General & OtherAccrued RevenuesDebtors - GeneralGST RecoupmentPrepaymentsSubtotal

Less: Allowance for Doubtful DebtsTotal Trade & Other Receivables

(c). Inventories

Stores & MaterialsTotal Inventories

215 149 215 149

4,145 4,627

4,433 4,794

(288) (167)

1,355 2,156

2,773 1,676 2,773 1,676

124 10 1,928 1,780

788 674 238 174

404 108

510 (3) (505)

404 119

3

- - (11)

(363)

(16)

Notes 2019 2018

482 1,078 (674)

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X8A13T

X8A14T

X8A15TX8A18T

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Note 6. Non-Current Assets

$ '000

(a). Equity Accounted Investments in Council Businesses

Council SolutionsTotal Equity Accounted Investments in Council Businesses

(b). Other Non-Current Assets

Capital Works-in-ProgressTotal Other Non-Current Assets

138 76 19 138 76

14,253 3,308 14,253 3,308

Notes 2019 2018

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Note 7a (i). 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 - Community 3 522,596 199 - - 522,795 657 - (3) - 25 15,773 538,565 682 - - 539,247 Land - Other 2 20,224 781 - - 21,005 2,836 - - - - 743 21,748 2,836 - - 24,584 Buildings & Other Structures 3 97,777 5,911 25,013 - 78,675 911 1,004 - (1,648) 89 35 97,617 8,118 26,670 - 79,066 Infrastructure- Stormwater Drainage 3 207,484 452 12,969 - 194,967 259 399 - (1,735) (961) 212,731 611 20,413 - 192,929 - Roads 3 530,477 4,343 42,217 - 492,603 5 3,172 - (4,625) 16 (26,624) 535,710 92 71,256 - 464,547 - Footpaths 3 79,925 8,164 9,008 - 79,081 2,497 617 - (730) 863 (2,649) 95,203 3,366 18,890 - 79,679 - Bridges 3 7,507 109 713 - 6,903 - 58 - (52) - (1,322) 6,621 - 1,034 - 5,587 - Traffic Control Devices 3 11,179 1,835 3,422 - 9,592 899 286 - (555) 637 9,376 25,745 1,613 7,123 - 20,235 - Community Wastewater Management 3 35,953 408 6,417 - 29,944 225 57 - (355) - 15,664 55,018 614 10,097 - 45,535 - Lighting 3 4,432 506 1,363 - 3,575 650 220 - (104) - - 4,432 1,376 1,467 - 4,341 Plant & Equipment 2 - 20,206 10,204 - 10,002 - 2,642 (674) (2,112) 565 - - 20,877 10,454 - 10,423 Furniture & Fittings 2 - 3,199 3,166 - 33 - 25 - (21) - - - 3,224 3,187 - 37 Library Books 3 3,319 152 2,526 - 945 - 375 - (412) - 33 3,398 182 2,639 - 941 Technology 3 - 6,517 2,839 - 3,678 1,155 261 - (827) 27 - - 7,960 3,666 - 4,294 Playground Equipment 3 5,932 - 811 - 5,121 320 398 - (168) 49 1,376 8,457 483 1,844 - 7,096 Irrigation Systems 3 13,566 597 6,713 - 7,450 349 223 - (456) 144 2,656 13,041 726 3,400 - 10,367 Fencing and Other Landscaping 3 - 4,332 832 - 3,500 241 225 - (232) 158 391 1,222 4,616 1,555 - 4,283 Sporting Courts, Facilities 3 11,921 1,635 4,179 - 9,377 23 536 - (481) - 2,782 15,842 286 3,891 - 12,237 Playing Field Formation 3 5,003 - 2,409 - 2,594 - 1,384 - (87) 25 808 4,993 1,409 1,678 - 4,724 Carpark Facilities 3 10,013 44 2,612 - 7,445 201 73 - (182) 6 2,349 10,811 208 1,127 - 9,892 Total Infrastructure, Property,Plant & Equipment

Comparatives 1,552,347 40,851 124,119 - 1,469,079 5,806 11,234 (868) (14,210) 1,215 17,027 1,567,308 59,390 137,413 - 1,489,285

Note 7a (ii). Investment PropertyNil

137,413

Revaluation Incrementsto Equity

(ARR) (Note 9)

AccumulatedAccumulated

as at 30/6/2018

1,489,285 11,228 (677) 11,955

Asset Additions

Asset Movements during the Reporting Periodas at 30/6/2019

Depreciation Expense (Note 3c)

WDVof Asset

Disposals

WIPTransfersNew /

Upgrade Renewals

2,604 20,430 1,520,042 190,390 - 59,279 1,567,308 59,390 1,651,154 - (14,782)

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

$ '000

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 ValuationsCertain land, and the buildings and structures thereon, are shown above as being based on fair value hierarchylevel 2 valuation inputs. They are based on prices for similar assets in an active market, with directly or indirectlyobservable adjustments for specific advantages or disadvantages attaching to the particular asset.

Valuations of Crown land, community land and land subject to other restrictions on use or disposal, shown above as being based on fair value hierarchy level 3 valuation inputs, are based on prices for similar assets in an active market, but include adjustments for specific advantages or disadvantages attaching to the particular asset that are not directly or indirectly observable in that market, or the number and / or amount of observable adjustments of which are so great that the valuation is more fairly described as being based on level 3 valuation inputs.

There is no known market for buildings, infrastructure and other assets. These assets are valued at depreciatedcurrent replacement cost. This method involves:

- The determination of the cost to construct the asset (or its modern engineering equivalent) using current prices formaterials and labour, the quantities of each being estimated based on recent experience of this or similar Councils,or on industry construction guides where these are more appropriate.

- The calculation of the depreciation that would have accumulated since original construction using current estimatesof residual value and useful life under the prime cost depreciation method adopted by Council.

This method has significant inherent uncertainties, relying on estimates of quantities of materials and labour, residual values and useful lives, and the possibility of changes in prices for materials and labour, and the potential for development of more efficient construction techniques.

Other InformationAt 1 July 2004 upon the transition to AIFRS, Council elected pursuant to AASB 1.D5 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.

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

$ '000

Valuation of Assets (continued)

Other Information (continued)Upon revaluation, the current new replacement cost and accumulated depreciation are re

‐

stated such that the difference represents the fair value of the asset deter

‐

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

Transition to AASB 13 - Fair Value MeasurementThe 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 & Land ImprovementsCouncil being of the opinion that it is not possible to attribute a value sufficiently reliably to qualify for recognition, land under roads has not been recognised in these reports.

Freehold land and land over which Council has control, but does not have title, is recognised on the cost basis.No capitalisation threshold is applied to the acquisition of land or interests in land.

Estimated future costs of reinstatement of land, capitalised in accordance with AASB 116.16(c) are reviewed annually (see Note 1).

A desktop valuation has been completed based on market evidence of valuations provided by the Valuer General in 2018/19 as at 30 June 2019.

Buildings & Other StructuresBuildings and other structures are generally recognised at fair value, based on current market values. However, special purpose buildings (such as public toilets) for which there is no market are valued at depreciated current replacement cost. Buildings that Council does not intend to replace at the end of their useful life are valued at the market value of the "highest and best" use. These assets were valued as at 30 June 2017 by APV Valuers and Asset Management. Assets will be depreciated by a consumption method.

- Basis of valuation: Fair value- Date of valuation: 30 June 2017- Valuer: APV Valuers & Asset Management, 3/97 Pirie St, Adelaide SA 5000

During 2018/19 a valuation inspection was conducted by APV Valuers & Asset Management, a number of Park Shelters were identified and valued at market rates.

page 22




$ '000


InfrastructureInfrastructure assets were valued by APV Valuers and Asset Management as at 30 June 2019 to reflect their service potential.

Assets have been depreciated by a consumption based method from 1 July 2009. Valuations of Signs were based on an estimated quantity of signs and an estimated average cost per sign. Technology infrastructure which was acquired in the financial year has been included with these classes of assets.

Roads, Kerb and Gutter, Footpaths- Basis of valuation: Fair value- Date of valuation: 30 June 2019- Valuer: APV Valuers & Asset Management, 3/97 Pirie St, Adelaide SA 5000

Stormwater Drainage- Basis of valuation: Fair value- Date of valuation: 30 June 2019- Valuer: APV Valuers & Asset Management, 3/97 Pirie Street, Adelaide SA 5000

Structures, Bridges, Car Parks- Basis of valuation: Fair value- Date of valuation: 30 June 2019- Valuer: APV Valuers & Asset Management, 3/97 Pirie Street, Adelaide SA 5000

A review of Bridge assets has resulted in improved componentization

Traffic Control Devices- Basis of valuation: Fair value- Date of valuation: 30 June 2019- Valuer: APV Valuers & Asset Management, 3/97 Pirie Street, Adelaide SA 5000

Lighting- Basis of valuation: Fair value- Date of valuation: 30 June 2015- Valuer: APV Valuers & Asset Management, 3/97 Pirie Street, Adelaide SA 5000

Plant, Furniture & EquipmentThese assets are recognised on the cost basis.

Library AssetsLibrary Assets were revalued by Council staff on 30 June 2019 on the basis of market cost per type. Any additions to the collection were recognised on a cost basis.

page 23




$ '000


Playground EquipmentPlayground equipment was revalued by APV Valuers and Asset Management in 2019 to reflect service potential. Condition based assessment was undertaken as part of the valuation on 30 June 2019. Additions completed in late 2019 are included at cost.

- Basis of valuation: Fair value- Date of valuation: 30 June 2019- Valuer: APV Valuers & Asset Management, 3/97 Pirie Street, Adelaide SA 5000

Irrigation SystemsIrrigation assets were revalued by APV Valuers and Asset Management in 2019 to reflect service potential. Condition based assessment was undertaken as part of the valuation on 30 June 2019. Additions completed in late 2019 are included at cost.


Fencing and Other LandscapingFencing assets were revalued by APV Valuers and Asset Management in 2019 to reflect service potential. Condition based assessment was undertaken as part of the valuation on 30 June 2019. Additions completed in late 2019 are included at cost.


Sporting Courts and FacilitiesSporting Courts and Facilities were valued by APV Valuers to reflect their service potential as at 30 June 2019. Full condition based assessment was undertaken as part of the revaluation on 30 June 2019. Assets have been depreciated by a consumption based method from 1 July 2009.


Playing Field FormationPlaying Field Formation were valued by APV Valuers and Asset Management in 2019 to reflect service potential.


page 24



Note 8. Liabilities

$ '000

(a). Trade and Other Payables

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

(b). Borrowings

LoansTotal Borrowings

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

(c). Provisions

Employee Entitlements (including oncosts)Total Provisions

-

515

5,861 5,861

3,991

13,000

507

1,268

2,636 1,802

- 2,151

5,861

69 - 84 99 -

3,648 - -

-

3,700

515 3,734 507

15,564

5,861 1,268 13,000

3,991 3,734

Notes2019

- 7,258

Non Current Current

221 -

6,545 -

- 16,407

Non Current

3,758

-

-

-

2019Current

20182018

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Note 9. Reserves

$ '000

(a). Asset Revaluation Reserve

Land - CommunityLand - OtherBuildings & Other StructuresInfrastructure- Stormwater Drainage- Roads- Footpaths- Bridges- Traffic Control Devices- Community Wastewater ManagementPlant & EquipmentLibrary BooksPlayground EquipmentIrrigation SystemsFencing and Other LandscapingSporting Courts, FacilitiesPlaying Field FormationCarpark FacilitiesOther AssetsTotal Asset Revaluation Reserve

Comparatives

$ '000

(b). Other Reserves

Community Waste Water ManagementCapital Renewal ReserveDeveloper Contribution ReservePathways North East ReserveTotal Other Reserves

Comparatives

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).

669

- -

-

1,446 -

4,385

1,446 - - -

- 101 186

41,185 15,664 -

135,491 (961) - -

-

59,867 (2,649)

5,222

5,022

(200)

- (637)

1/7/2018 Increments (Decrements)

-

- 11,490

1,116,209 25,966

5,022

31,422 35 -

-

-

-

2,652

-

75

-

17,027

3,289 - (637)

- -

(1,107) 103 391 -

2,656 -

134,530

5,202 2,114

Tfrs to Reserve

363,554

- 3,880

-

30/6/2019

743

- - (1,322) -

-

9,376 -

Impairments

-

1/7/2018 Tfrs from Reserve

Other Movements 30/6/2019

- 186

-

31,457

- 2,008 - (3,431) - 2,271

1,095,779

-

(26,624) -

- -

390,178

-

Notes

1,095,779

75 - -

(774) 2,782 - (4,239) 808 -

(78) 2,349 - 25,966

- 494 -

636 33 - -

1,549 (18) 1,376 - - 1,358

1,616

25,521

57,218

NotesTransfers

15,773 - 873

- 424,547 440,320

- - -

1,078,752

20,430

-

101 -

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page 26



Note 9. Reserves (continued)

$ '000

Community Waste Water ManagementThe Community Waste Water Management Reserve is to fund maintenance and upgrade of Council'scommunity wastewater pipe network.

Council has recently completed a full cost review of the trading enterprise to comply with the Water Industry Act 2012 and ESCOSA regulations. In 2018/19 a movement of $637,297 in the reserve represents the gap of incomeand expenditure for the CWMS system.

Capital Renewal ReserveThe Capital Renewal Reserve is a reserve that funds future capital projects. Monies are transferred to thereserve from the sale of property or budget savings from capital projects.

Developer Contribution ReserveThe Developer Contribution Reserve is a reserve where contributions are made to fund infrastructureprojects in particular areas.

Pathways North East ReserveThe Pathways North East Reserve is a reserve to fund youth projects.

Note 10. Assets Subject to Restrictions

Council does not hold any assets subject to restrictions

Note 11. Reconciliation to Statement of Cash Flows

$ '000

(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 Statement of Financial Positionas follows:

Total Cash & Equivalent AssetsBalances per Statement of Cash Flows

Notes1/7/2018 Increments

(Decrements) Transfers Impairments 30/6/2019

2019 2018

1,676 5

Notes

2,773 2,773 1,676

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

$ '000

(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 Unpaid Employee BenefitsNet Cash provided by (or used in) operations

(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:

Bank OverdraftsCorporate Credit CardsLGFA Cash Advance Debenture Facility

Council has access to cash facilities of $30 million and minimises interest expense by transferring funds between cash at bank and the debenture facilities.

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

(24)

242

(62) 16 (933)

(3,766) (2,634)

(121)

2i

500 500 300 300

216 933 216 933

21,048

Notes 2019 2018

(404) (108) 21,195 22,079

361

48

265 53

(131)

10,861 11,528

14,210

216

14,782

22,148

(828) 84

(66) 39

933

30,000 30,000

(216)

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Note 12a. Functions

Actual Actual Actual Actual Actual Actual Actual Actual Actual Actual$ '000 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018

Office of the CEO 96 59 3,334 3,064 (3,238) (3,004) 83 50 - - Assets and Environment 1,306 2,850 53,531 50,952 (52,225) (48,102) 410 4,171 1,538,071 1,495,818 Community and Cultural Development 8,232 7,920 15,337 14,591 (7,105) (6,671) 2,109 1,902 1,198 958 Organisational Services & Excellence 86,191 81,722 17,148 16,075 69,043 65,646 4,983 1,785 5,072 5,120

Total Functions/Activities 95,825 92,551 89,350 84,682 6,475 7,869 7,585 7,908 1,544,341 1,501,896

Revenues and expenses exclude net gain (loss) on disposal or revaluation of assets, 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

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Note 12b. Components of Functions

$ '000

The activities relating to Council functions are as follows:

OFFICE OF THE CEO

ASSETS AND ENVIRONMENT

COMMUNITY AND CULTURAL DEVELOPMENT

ORGANISATIONAL SERVICES & EXCELLENCE

Note 13. Financial Instruments

Recognised Financial Instruments

Bank, Deposits at Call, Short Term Deposits Accounting Policy:Recognised at amortised cost; Interest isrecognised when earned.

Terms & Conditions:Deposits are returning fixed interest rates between 1.25% and 1.5% (2018: 1.5% and 1.7%).

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.

Terms & Conditions:Secured over the subject land, arrears attract interest of 6.6%(2018: 6.75%). 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).

Office of the Chief Executive Officer, Governance and Policy, City Strategy.

Building Assets and Environment, Civil Assets, Civil and Water Operations, Parks, Strategic Assets.

City Development, Community Development and Engagement, Community Safety, Library Services Arts and Culture, Recreation and Leisure Services.

Continuous Improvement, Customer and Communications, Finance and Rating Operations, Information Technology Solutions, Organisational Development, Procurement and Contract Management.

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Note 13. Financial Instruments (continued)

$ '000

Recognised Financial Instruments

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.

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

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.

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.


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 3.35% and 6.8% (2018: 3.6% and 6.8%).


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

page 31




$ '000

2019Financial AssetsCash & EquivalentsReceivablesRates ReceivableTotal Financial Assets

Financial LiabilitiesPayablesCurrent BorrowingsNon-Current BorrowingsTotal Financial Liabilities

$ '000

2018Financial AssetsCash & EquivalentsReceivablesTotal Financial Assets

Financial LiabilitiesPayablesCurrent BorrowingsNon-Current BorrowingsTotal Financial Liabilities

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

Other Variable RatesFixed 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.

Total Contractual

Total Contractual> 5 years

- 1,676 1,676

ValuesDue

10,607

3.35% 13,000 6.80% 5,861 6.80% 6,629

3.71%

19,778 11,875 5,861 - 5,861

< 1 year & ≤ 5 years

1,928

-

- 13,000 5,861

CarryingValue

5,861

1,979 -

- -

-

-

13,762 - 5,861 -

2,673

13,000

12,649

-

Due > 1 year

-

Carrying

1,268 -

4,349 -

10,607

19,623

- 6,680

-

2,773 -

-

Due

- 1,268

Due > 1 yearDue& ≤ 5 years

-

13,000 13,000 32,623 32,623

- 1,676

< 1 year

-

7,129 18,861

2,773 2,773

6,680 6,680 1,928

5,861

-

- 5,861

2,673

Weighted Avg Weighted Avg

500

30 June 2019

Interest RateCarrying

4,349 4,349

-

30 June 2018

13,762

1,268

Carrying

-

- 1,979

Cash Flows

Interest RateValue

17,736

Due> 5 years

13,762

2,673

1,979

Values

1,928

Cash Flows

page 32




$ '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 33



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:

LandBuildingsTrafficLightingCity BeautificationSporting pitch renewalFencingOpen Space projectsOther

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:

Waste Management ServicesDebt CollectionPayroll ServicesOther

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

-

7,570 3,811

7,570

6,850

-

156

-

-

- -

Notes

2,750

22,762

97 3,811

-

3,811

288 156

- 25,575

2019 2018

25,575

7,570

16,870

23,806

10,795

23,806

576

8,273 14,780 15,533

8,261 312

- 51 - 25

594 373 - 475 - 52

29 85

X12A5T

page 34



Note 15. Financial Indicators

$ '000

Operating SurplusIs the Operating Surplus (Deficit) before capital amounts.

Operating Surplus RatioOperating SurplusTotal Operating Income

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

Net Financial Liabilities (excluding Non-Current Assets Held for Sale)Net Financial Liabilities are defined as total liabilities less financial assets (excluding equity accounted investments in Council businesses) and excluding non-current assets held for sale).

Net Financial Liabilities Ratio (excluding Non-Current Assets Held for Sale)Net Financial LiabilitiesTotal Operating Income

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.

Net Financial Liabilities (including Non-Current Assets Held for Sale)Net Financial Liabilities are defined as total liabilities less financial assets (excluding equity accounted investments in Council businesses) and including non-current assets held for sale.

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.

8.8%8.5%6.8%

Amounts2019 2019 2018 2017

Indicator Prior Periods

32,013 33.4%

21,474 28,273

23.2% 32.3%95,825

95,825 6,475

6,475 6,475 7,853 7,703

32,013 32,013

29,238 29,238 18,699 27,763

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Note 15. Financial Indicators (continued)

$ '000

Adjustments to RatiosIn 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. These Adjusted Ratios correct for the resulting distortion

in key ratios for each year and provide a more accurate basis for comparison.

Adjusted Operating Surplus Ratio

Adjusted Net Financial Liabilities Ratio

Interest Cover Ratio

Total Operating IncomeInterest Cover is defined as finance costs expense (excluding unwinding of present value discounts and premiums) less Investment Income as a percentageof Total Operating Income (less Investment Income).

Asset Renewal Funding 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.

Fiscal BalanceNet lending position or net borrowing requirement in uniform presentation of finances

(10,411)

Amounts Indicator Prior Periods2019 2019 2018 2017

6,744 (3,594)

Finance Costs Expense less Investment Income 994 1.1% 1.0% 1.1%94,025

(10,411)

18,803 127.2% 88.5% 102.7%14,782

5.5% 8.2% 6.7%

31.1%22.8%33.2%

page 36



Note 15. Financial Indicators - Graphs (continued)

Purpose of Adjusted Net Financial Liabilities

Ratio

Commentary on 2018/19 Result

2018/19 Ratio 33.2%

This indicator is to determine the

percentage the operating revenue (adjusted for

timing differences in the Financial Assistance Grant) varies from

operating expenditure

The Net Financial Liabilities Ratio (including Non-Current Assets Held for Sale) for 2018/19

is 33.2% which is within Council's target of 25% - 35%.

Operating Surplus Ratio is the operating surplus (deficit) before capital. The Operating Surplus

Ratio for 2018/19 is 6.8% which is within Council's target of 2.5% - 10%

The Net Financial Liabilities Ratio (excluding Non-Current Assets Held for Sale) for 2018/19

is 33.4% which is within Council's target of 25% - 35%.

Purpose of Interest Cover Ratio


2018/19 Ratio 1.1%

This indicator measures the ability to pay

interest on outstanding debt

The percentage of revenue allocated to interest (excluding NRM Levy and investment income)

for 2018/19 is 1.1%

Purpose of Operating Surplus Ratio


2018/19 Ratio 6.8%

Purpose of Adjusted Operating Surplus Ratio


2018/19 Ratio 5.5%


percentage the operating revenue (adjusted for

timing differences in the Financial Assistance Grant) varies from


The Adjusted Operating Surplus Ratio is the operating surplus (deficit) before capital adjusted for timing differences from the

Financial Assistance Grants and Supplementary Local Road Funding payments. The Adjusted Operating Surplus Ratio for 2018/19 is 5.5%

which is within Council's target of 2.5% - 10%

Purpose of Net Financial Liabilites

Ratio


2018/19 Ratio 33.4%

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


percentage the operating revenue varies from


6.4%

8.8% 8.5%

6.8%

0%2%4%6%8%

10%12%

2016 2017 2018 2019

Rat

io %

Operating Surplus Ratio

6.4% 6.8%8.2%

5.5%

0%2%4%6%8%

10%12%

2016 2017 2018 2019

Rat

io %

Adjusted Operating Surplus Ratio

28.7%32.3%

23.2%

33.4%

0%

10%

20%

30%

40%

2016 2017 2018 2019

Rat

io %

Net Financial Liabilities Ratio (excluding Non-Current Assets Held for Sale)

28.0%31.1%

22.8%

33.2%

0%

10%

20%

30%

40%

2016 2017 2018 2019

Rat

io %

Net Financial Liabilities (including Non-Current Assets Held for Sale)

1.4%1.1% 1.0% 1.1%

0%

1%

1%

2%

2016 2017 2018 2019

Rat

io %

Interest Cover Ratio

page 37



Note 15. Financial Indicators - Graphs (continued)

2018/19 Ratio -10,411

Indicates the lending position or net

borrowing requirement in uniform presentation

of finances

The Fiscal Balance ensures that Council has the capacity to reduce debt. The Fiscal Balance

position in 2018/19 was ($10,411) due to the planned investment in the Service Centre of

$10.5m and the $2.3m investment into Sporting Buildings.

Purpose of Fiscal Balance


Purpose of Asset Renewal Funding Ratio


2018/19 Ratio 127.2%

This indicator aims to determine if assets are

being renewed and replaced in an optimal

way

The Asset Sustainability Ratio for 2018/19 is 127.2% with a target ratio of 90% - 110% over a

three year rolling period. This ratio is currently higher than target due to the Service Centre fit out costs and investment

into IT equipment.

106.0% 102.7%88.5%

127.2%

0%

50%

100%

150%

2016 2017 2018 2019

Rat

io %

Asset Renewal Funding Ratio

5,689

-3,594

6,744

-10,411-16,000

-11,000

-6,000

-1,000

4,000

9,000

14,000

2016 2017 2018 2019Bala

nce

Fiscal Balance

page 38



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)

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

Net Outlays on New and Upgraded Assets

add back Amounts Received Specifically for New and Upgraded Assets

Subtotal

Net Lending / (Borrowing) for Financial Year

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

482

2018

(4,021)

3,766 2,634

14,782

(10,411)

1,078

(16,634) (5,891)

2019

6,744

add back Proceeds from Sale of Surplus Assets (including Investment Property, Real Estate Developments and Non-Current Assets Held for Resale)

1,638

92,551 95,825 (89,350) (84,698)

7,853 6,475

(12,865)

(19,881) (13,054)

(2,747)

3 510

14,210

X12A7T

page 39



Note 17. Operating Leases

$ '000

Leases Providing Revenue to the Council

(i) Investment Property

Leases 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 InformationTechnology items of plant and equipment, namely multi-function printers.

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

58

24

155 134

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

Rentals received, and outgoings reimbursed, in relation to Investment Property are also disclosed in Note 2. These lease agreements, all of which areclassified as operating leases, are made on a non-cancellable basis whereverpracticable.

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.

11

1,654 2,011

571 949 1,193

2018

13

663

2019

28 - -

86

X12A8T

page 40



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 2018/19; 9.50% in 2017/18). 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 2017/18) 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, Louise Campbell, FIAA, of WillieTowers Watson as at 30 June 2017. 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.

X12A9T

page 41



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 ActivityProcurement

Total Carrying Amounts - Joint Ventures & Associates

Council SolutionsOn 11 September 2012 Council approved to formalise the G6 Council Solutions arrangement, an initiative serving a collective community of nearly 600,000 people. lt was established for the purpose of combining its purchasing power to obtain cost savings and other benefits. Council's equity in the arrangement prior to this formalisation has been taken into consideration as an adjustment to equity share. The entity is likely to be closed in 2019/20.

(b) Relevant Interests

Name of EntityCouncil Solutions

(c) Movement in Investment in Joint Venture or Associate

Opening BalanceShare in Operating ResultCouncil's Equity Share in the Joint Venture or Associate

Proportion of

17%

138 76

138

Council's Share of Net Assets

62 (16) 138 76

2018

2019 2018

(16)

2018 2019

76 92 - 62

Result Equity Voting PowerOperating Share of

17% 17% 17% 17% 17%

Interest in Ownership

Council Solutions

2018 2019

2019 2018

Council Solutions 138 76 2018

Council's Share of Net Income

2019

62 20182019 2018 2019

(16)

76 138

76

2019

X12A0T

page 42



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

$ '000

Council has commenced a process to review assets that are surplus to requirements.

(i). Non Current Assets & Disposal Group Assets

LandTotal Non Current Assets & Disposal Group Assets

Note 21. Contingencies & Assets/Liabilities Not Recognised in theStatement of Financial Position

The following assets and liabilities do not qualify for recognition in the Statement of Financial Position, but knowledgeis considered relevant to the users of the financial report in making and evaluating decisions about the allocation of scarce resources.

1. LAND UNDER ROADSAs reported in the Financial Statements, Council is of the opinion that it is not possible to attribute a valuesufficiently reliably for these assets to qualify for recognition, and accordingly land under roads has not beenrecognised in the reports.

At reporting date, Council controlled 602 km of road reserves of average width 15 metres.

2. POTENTIAL INSURANCE LOSSESCouncil is a multi-purpose organisation providing a large range of building, parks infrastructure, playgrounds andother facilities accessible to the public. At any time, it is likely that claims will have been made against Councilthat 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. BANK GUARANTEESCouncil has guaranteed certain loans and other banking facilities advanced to community organisations and sportingbodies, amounting to $875,000 (2018: $875,000) at reporting date.

Council does not expect to incur any loss arising from these guarantees.

2,775 2,775

2019 2018

2,775 2,775

X12A1T

X12A10T

X12A12T

page 43



Note 21. Contingencies & Assets/Liabilities Not Recognised in theStatement of Financial Position (continued)

4. OTHER EVENTSCouncil has a comprehensive Safety First Strategy in place to ensure compliance with the Work, Health andSafety Legislation and the WorkCover Performance Standards for Self-Insured Employers. Our Council is alsoa member of the Local Government Workers Compensation Scheme. On 21 September 2016 sadly a Councilemployee was fatally injured in a roadside accident whilst at work. Any possible financial impact from thisincident is not known at issue date.

5. LEGAL MATTERSCouncil is the planning consent authority for its area under the Development Act 1993 (as amended). Pursuant tothat Act, certain persons aggrieved by a planning decision of the Council may appeal. It is normal practice thatparties bear their own legal costs. At the date of these reports, Council had notice of one appeal against planningdecisions made prior to reporting date. All known costs have been recognised, but the amount of further costscannot be known until the appeals are determined.

Note 22. Events after the Statement of Financial Position Date

$ '000

Key Management PersonnelTransactions with Key Management PersonelThe Key Management Personnel of the Council include the Mayor, Councillors, CEO and certain prescribed officers under section 112 of the Local Government Act 1999 .

The compensation paid to Key Management Personnel comprises:Executive Staff (4.0 FTE)Non-Executive Staff (16.6 FTE)Elected Members (18)Total

Amounts paid as direct reimbursement of expenses incurred on behalf of Council have not been included above.

939

3,826

2019 2018

2,556 2,414 876

3,610 331 320

X12A11T

Events that occur after the reporting date of 30 June 2019, up to and including the date when the financial statements are "authorised for issue" have been taken into account in preparing these statements.

Council has adopted the date of receipt of the Certification of Financial Statements as the appropriate "authorised for issue" date relating to these General Purpose Financial Statements.

Accordingly, the "authorised for issue" date is 10 September 2019.

Council is unaware of any material or significant "non adjusting events" that should be disclosed.

X12A13T Note 23. Related Party Transactions

page 44



Note 23. Related Party Transactions (continued)

$ '000

Receipts from Key Management Personnel comprise:Other than amounts paid as ratepayers or residents (e.g. rates, swimming pool entry fees, etc.), Council received the following amounts in total:

Contributions for Fringe Benefits Tax purposesPlanning and Building Application FeesTotal

Council's Executive and Management staff have access to enter into a salary sacrificed arrangement for the privateuse of a motor vehicle. Any Fringe Benefits tax liability that arises for such use is calculated and deducted fromtheir salary to fully offset the Fringe Benefits Tax payable.

The nature of these organisation's activities with Council typically include the provision of services to Council, and lease property from Council; they may also be the recipient of grants from Council. Transactions with these organisations are immaterial in amount and nature, with the exception of:

Local Government Association: $115,637 (Funds Paid)Local Government Workers Compensation Scheme: $1,175,508 (Funds Paid)Modbury Bowling Club: $1,069,089 (Funds Received)

Key management personnel and their close family members may either have an employment relationship or committee role with these organisations and/or access their services. All matters when addressed by Council staff are covered by Council's conflict-of-interest procedures.

2019 2018

- 59

59

Council contains some key management personnel that have relationships with parties that Council may transact with on a regular basis. Relationships include: Tea Tree Gully RSL, Modbury Bowls Club, Modbury High School, Local Government Association of SA, Greater Adelaide Region of Councils, Wynn Vale Primary School, Neighbourhood Watch, Golden Grove Recreation and Arts Centre, Golden Grove High School, Comedy Capers Gang Show, 25th Australian Scout Jamboree, Banksia Park International High School, Voluntary Tea Tree Gully Community Services Forum, Dernancourt Community Garden Inc, Hope Valley Football Club, Hope Valley Cricket Club, Soul Origin, Australian Labor Party Morialta Sub Branch, Highbury Primary School Governing Council, International Business Analysis Australia, Field Consulting Services, Change Management Institute of SA, ASG, Council Solutions, Ardtornish Primary School, Modbury High School, Tea Tree Gully Gymsports, Pedare Primary School, Animal Welfare League SA, Golden Knights Karate – St Agnes, South Australian District Netball Association, Gym Sports, Wynn Vale Kindergarden, St Francis Xavier Schools, Sferas Park Suites and Convention Centre

51 1

52

page 45

Tel: +61 8 7324 6000 Fax: +61 8 7324 6111 www.bdo.com.au

Level 7, BDO Centre 420 King William St Adelaide SA 5000 GPO Box 2018, Adelaide SA 5001 AUSTRALIA

BDO Audit (SA) Pty Ltd ABN 33 161 379 086 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275, an Australian company limited by guarantee. BDO Audit (SA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and

form part of the international BDO network of independent member firms. Liability limited by a scheme approved under Professional Standards Legislation.

INDEPENDENT AUDITOR'S REPORT

TO THE PRINCIPAL MEMBER OF CITY OF TEA TREE GULLY

Report on the Audit of the Financial Report

Opinion

We have audited the financial report of City of Tea Tree Gully (the Council), which comprises

the statement of financial position as at 30 June 2019, the statement of profit and loss and other

comprehensive income, the statement of changes in equity and the statement of cash flows for

the year then ended, and notes to the financial report, including a summary of significant

accounting policies, and the certification of the financial statements.

In our opinion the financial report of City of Tea Tree Gully, presents fairly, in all material

respects, the Council’s financial position as at 30 June 2019 and its financial performance for the

year ended on that date in accordance with Australian Accounting Standards, the Local

Government Act 1999, and the Local Government (Financial Management) Regulations 2011.

Basis for opinion

We conducted our audit in accordance with Australian Auditing Standards. Our responsibilities

under those standards are further described in the Auditor’s Responsibilities for the Audit of the

Financial Report section of our report. We are independent of the Council in accordance with

the Local Government Act 1999 and the ethical requirements of the Accounting Professional and

Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (the Code) that

are relevant to our audit of the financial report in Australia. We have also fulfilled our other

ethical responsibilities in accordance with the Code.

We confirm that the independence declaration required by the Local Government Act 1999,

which has been given to the Council, would be in the same terms if given to the Council as at the

time of this auditor’s report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a

basis for our opinion.

Information Other than the Financial Report and Auditor’s Report Thereon

Management is responsible for the other information. The other information obtained at the date

of this auditor’s report is the annual report of Council Solutions Regional Authority for the year

ended 30 June 2019.

Our opinion on the financial report does not cover the other information and accordingly we do

not express any form of assurance conclusion thereon.

In connection with our audit of the financial report of the City of Tea Tree Gully, our

responsibility is to read the other information and, in doing so, consider whether the other

information is materially inconsistent with the financial report or our knowledge obtained in the

audit, or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of

this other information, we are required to report that fact. We have nothing to report in this

regard.

Council’s Responsibility for the Financial Report

The Council’s officers are responsible for the preparation and fair presentation of the financial

report in accordance with Australian Accounting Standards, the Local Government Act 1999 and

the Local Government (Financial Management) Regulations 2011and for such internal control as

the Council’s officers determine is necessary to enable the preparation and fair presentation of

the financial report that is free from material misstatement, whether due to fraud or error.

In preparing the financial report, the Council’s officers are responsible for assessing the

Council’s ability to continue as a going concern, disclosing, as applicable, matters related to

going concern and using the going concern basis of accounting unless the Council’s officers either

intend to liquidate the Council or to cease operations, or has no realistic alternative but to do

so.

Auditor’s responsibilities for the audit of the Financial Report

Our objectives are to obtain reasonable assurance about whether the financial report as a whole

is free from material misstatement, whether due to fraud or error, and to issue an auditor’s

report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a

guarantee that an audit conducted in accordance with the Australian Auditing Standards will

always detect a material misstatement when it exists. Misstatements can arise from fraud or

error and are considered material if, individually or in the aggregate, they could reasonably be

expected to influence the economic decisions of users taken on the basis of this financial report.

A further description of our responsibilities for the audit of the financial report is located at the

Auditing and Assurance Standards Board website (http://www.auasb.gov.au/Home.aspx) at:

http://www.auasb.gov.au/auditors_files/ar4.pdf.

This description forms part of our auditor’s report.

BDO Audit (SA) Pty Ltd

Andrew Tickle

Director

Adelaide, 16 September 2019

http://www.auasb.gov.au/Home.aspx

http://www.auasb.gov.au/auditors_files/ar4.pdf



BDO Audit (SA) Pty Ltd ABN 33 161 379 086 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275,

an Australian company limited by guarantee. BDO Audit (SA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and


INDEPENDENT ASSURANCE REPORT

ON THE INTERNAL CONTROLS OF THE CITY OF TEA TREE GULLY

Opinion

We have undertaken a reasonable assurance engagement on the design and the operating

effectiveness of controls established by City of Tea Tree Gully (‘the Council’) in relation to

financial transactions relating to the receipt, expenditure and investment of money, acquisition

and disposal of property and incurring of liabilities, throughout the period 1 July 2018 to 30 June

2019 relevant to ensuring such transactions have been conducted properly and in accordance

with law.

In our opinion, in all material respects:

(a) The controls established by Council in relation to financial transactions relating to the

receipt, expenditure and investment of money, acquisition and disposal of property and

incurring of liabilities were suitably designed to ensure such transactions have been

conducted properly and in accordance with law; and

(b) The controls operated effectively as designed throughout the period from 1 July 2018 to 30

June 2019.

Basis for opinion

We conducted our engagement in accordance with Standard on Assurance Engagements ASAE

3150 Assurance Engagements on Controls issued by the Auditing and Assurance Standards Board.

We believe that the evidence we have obtained is sufficient and appropriate to provide a basis

for our opinion.

The Council’s responsibilities for the internal controls

The Council is responsible for:

a) The receipt, expenditure and investment of money, acquisition and disposal of property and

incurring of liabilities;

b) Identifying the control objectives

c) Identifying the risks that threaten achievement of the control objectives

d) Designing controls to mitigate those risks, so that those risks will not prevent achievement of

the identified control objectives; and

e) Operating effectively the controls as designed throughout the period.

Our independence and quality control

We have complied with the independence and other relevant ethical requirements relating to

assurance engagements, and apply Auditing Standard ASQC 1 Quality Control for Firms that

Perform Audits and Reviews of Financial Reports and Other Financial Information, and Other

Assurance Engagements in undertaking this assurance engagement.

Assurance practitioner’s responsibilities

Our responsibility is to express an opinion, in all material respects, on the suitability of the

design to achieve the control objectives and the operating effectiveness of controls established

by Council in relation to financial transactions relating to the receipt, expenditure and

investment of money, acquisition and disposal of property and incurring of liabilities. ASAE 3150

requires that we plan and perform our procedures to obtain reasonable assurance about

whether, in all material respects, the controls are suitably designed to achieve the control

objectives and the controls operated effectively throughout the period.

An assurance engagement to report on the design and operating effectiveness of controls

involves performing procedures to obtain evidence about the suitability of the design of controls

to achieve the control objectives and the operating effectiveness of controls throughout the

period. The procedures selected depend on our judgement, including the assessment of the risks

that the controls are not suitably designed or the controls did not operate effectively. Our

procedures included testing the operating effectiveness of those controls that we consider

necessary to achieve the control objectives identified. An assurance engagement of this type

also includes evaluating the suitability of the control objectives.

Limitations of controls

Because of the inherent limitations of an assurance engagement, together with any internal

control structure it is possible that, even if the controls are suitably designed and operating

effectively, the control objectives may not be achieved and so fraud, error, or non-compliance

with laws and regulations may occur and not be detected.

An assurance engagement on operating effectiveness of controls is not designed to detect all

instances of controls operating ineffectively as it is not performed continuously throughout the

period and the tests performed are on a sample basis. Any projection of the outcome of the

evaluation of controls to future periods is subject to the risk that the controls may become

inadequate because of changes in conditions, or that the degree of compliance with them may

deteriorate.


Andrew Tickle

Director




Certification of Auditor Independence

To the best of our knowledge and belief, we confirm that, for the purpose of the audit of City of Tea Tree Gullyfor the year ended 30 June 2019, the Council’s Auditor, BDO has maintained its independence inaccordance with the requirements of the Local Government Act 1999 and the Local Government (FinancialManagement) 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.

John MoyleCHIEF EXECUTIVE OFFICER

Peter Field PRESIDING MEMBER, AUDIT COMMITTEE

Date: 3 September 2019

X14A0T

page 50



BDO Audit (SA) Pty Ltd ABN 33 161 379 086 is a member of a national association of independent entities which are all members of BDO (Australia) Ltd ABN 77 050 110 275,

an Australian company limited by guarantee. BDO Audit (SA) Pty Ltd and BDO (Australia) Ltd are members of BDO International Ltd, a UK company limited by guarantee, and


CERTIFICATION OF AUDITOR INDEPENDENCE

I confirm that, for the audit of the financial statements of the City of Tea Tree Gully for the

year ended 30 June 2018, I have maintained my independence in accordance with the

requirements of APES 110 – Code of Ethics for Professional Accountants, Section 290,

published by the Accounting Professional and Ethical Standards Board, 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.

Andrew Tickle

Director



Annual Report2018/19

Council Solutions is a joint initiative of the Cities of Adelaide, Charles Sturt, Marion, Onkaparinga,

Salisbury and Tea Tree Gully that make up the Constituent Councils.

Established in 2012 as a Regional Authority in accordance with Section 43 of the Local Government

Act 1999, Council Solutions provides a collaborative and strategic approach to the procurement of

goods and services on behalf of its Constituent Councils, including negotiating and managing

contracts, and investigating the provision of other shared functions.

This collaborative approach to procurement not only provides significant purchasing power to attain

the best value for the community, but it also optimises the financial sustainability of each of the

Constituent Councils by reducing administrative costs, the number of tender processes and replicated

contract management activities.

The goal of Council Solutions is to improve community prosperity and wellbeing by undertaking local

government procurement and collaborative services that:

Deliver best value for money

Explore innovative ways of delivering infrastructure and services

Value partnership between councils and suppliers

Background

Council Solutions provides the legal structure to the G6 Procurement Group formed in 1994 by the

Cities of Adelaide, Charles Sturt, Marion, Onkaparinga, Salisbury and Tea Tree Gully to address the

combined $415 million annual spend on infrastructure and services by these Constituent Councils.

Ministerial approval was given for the Council Solutions Regional Authority to be established by

notice in the SA Government Gazette on 20 December 2012. The Gazette states the purpose of the

Authority as “promoting procurement and service delivery amongst the constituent councils.”

As a South Australian local government body, it is governed by the:

Local Government Act 1999

Local Government (Financial Management) Regulations 2011

Council Solutions Regional Authority Charter 2012

Council Solutions Regional Authority

25 Pirie St, Adelaide SA 5000

councilsolutions.sa.gov.au

ABN 92 168 067 160

Date prepared: 30 September 2019

1

ANNUAL REPORT 2018/19

Foreword from the Chair

Council Solutions continues to optimise the financial sustainability of Constituent Councils through the benefits of collaborative strategic procurement and contract management.

The benefits of aligning and managing contracts under the regional subsidiary are significant and resulted in estimated savings of $7.5m for the Constituent Councils and accession Councils.

Council Solutions achieved a favourable performance against budget and maintains a strong equity position. I thank our Audit Committee who supports us in achieving the highest standards of accountability, transparency and governance.

I commend the Council Solutions team for their ongoing commitment, dedication and professionalism during 2018/19. I would also like to

acknowledge Oliver Barry for his significant contribution as Chief Executive Officer from May 2016 to July 2018, Tim Dawson for his contribution as Senior Procurement Officer from August 2016 to July 2018 and, Kerrie Jackson, Acting Chief Executive Officer from July 2018 to February 2019.

Finally, the Council Solutions Board of Management and I would like to acknowledge and thank Catherine Cooper, Chair of the Board November 2012 to December 2018 for her support in achieving the strategic goals of Council Solutions.

Jeff Tate Chair of the Board Council Solutions Regional Authority

2


Report from the Council Solutions Manager

The past year has seen Council Solutions continue to work in partnership with our Constituent Councils to deliver optimum value for money from collaborative strategic procurement and contract management.

On behalf of our six Constituent and eight Accession Councils, Council Solutions has delivered 32 collaborative contract and panel agreements, across 110 suppliers, with a combined total value of over $68 million per annum. Council Solutions ensures best practice across its suite of contracts, actively promoting continuous improvement and developing opportunities for innovation.

The Council Solutions Governance Framework and Board-approved Key Performance Indicators ensures the effectiveness and efficiency of Council Solutions’ operations when collaborating with Councils and industry partners.

I thank the Board for their support, and the Council Solutions team comprising Audrey Rangel, Bruce Wright, Colin Owen and Tammy Sheridan for their continuing professionalism.

Clare Coupar Manager Council Solutions Regional Authority

3


Board of Management 2018/19

MR MARK GOLDSTONE CITY OF ADELAIDE

MR PAUL SUTTON CITY OF CHARLES STURT

MR ADRIAN SKULL CITY OF MARION

MR MARK DOWD CITY OF ONKAPARINGA

MR JOHN HARRY CITY OF SALISBURY

MR JOHN MOYLE CITY OF TEA TREE GULLY

MS CATHERINE COOPER INDEPENDENT CHAIR (TO DEC 18)

MR JEFF TATE INDEPENDENT CHAIRPERSON

4


Board of Management 2018/19

Council Solutions is a body corporate, governed by a Board of Management, comprising seven members being the Chief Executive Officer from each Constituent Council: The Cities of Adelaide, Charles Sturt, Marion, Onkaparinga, Salisbury and Tea Tree Gully, and one person who is not a member or officer of a Constituent Council who holds the position of Chair.

The Board held three formal and two out-of-session meetings during the year to consider the strategic direction and financial integrity of the organisation. Meeting attendances were as follows:

Board Position Board Member Formal Meetings Attended

Independent Chairperson Mr Jeff Tate 2

Independent Chairperson – till Dec 2018

Ms Catherine Cooper 1

City of Adelaide Mr Mark Goldstone, CEO 3

City of Charles Sturt Mr Paul Sutton, CEO 3

City of Marion Mr Adrian Skull, CEO 3

City of Onkaparinga Mr Mark Dowd, CEO 3

City of Salisbury Mr John Harry, CEO 2

City of Tea Tree Gully Mr John Moyle, CEO 3

Audit Committee

The Council Solutions Board is supported by one designated committee being the Audit Committee which is formally appointed pursuant to the requirements under the Local Government Act 1999 (the Act) and the Local Government (Financial Management) Regulations 2013.

The function of the Audit Committee includes reviewing annual financial statements to ensure that they present fairly the state of the Authority and reviewing the adequacy of financial management systems and practices. The Audit Committee is governed by Terms of Reference with the work flow controlled by an Audit Committee Work Program. The Audit Committee Work Program is updated after each meeting to reflect Committee achievements and actions arising from either the meeting for the Council Solutions Board Meeting.

Please refer to Appendix B for a report on the activities undertaken by the Audit Committee throughout the 2018/19 financial year.

5


Governance and Operating Framework

Council Solutions works in partnership with its Constituent Councils to deliver value outcomes. In accordance with the Council Solutions Governance Framework and Key Performance Indicators, the critical success factors that underpin the optimal effectiveness and value provided by the collaborative partnership with Council Solutions and its Constituent Councils are:

Shared accountability and responsibility for achievement of goals and outcomes;

Evidence-based opportunity identification, analysis and performance measurement via shared data and information; and

Effective communication with key stakeholders to ensure clear understanding of goals, roles and responsibilities.

The Governance Framework assists in enhancing the effectiveness and efficiency of collaborative procurement by having the appropriate decision-making structure that ensures key staff have ownership in the management and success of the operations. It also plays the key role of developing and maintaining a strong partnership and collaborative culture and is underpinned by seven inter-related elements:

Direction - shared understanding of our purpose and priorities through collaboration and effective planning and resource allocation;

Expectations - agreed performance expectations through effective communication;

Delivery - quality customer-focused service delivery through effective resource management, monitoring, review and reporting;

Improvement - enhance our performance through review, intervention, capability-building and internal control mechanisms;

Risk Management - regularly assess and respond to risk and opportunities;

Responsibilities - accountability and transparency for decisions through information management, evaluation and Audit Committee and Board reporting; and

Alignment - functions, structures and a culture that supports the success of Council Solutions through quality leadership, role clarity and empowered staff.

Key Performance Indicators provide the Board of Management oversight of the effectiveness and value that Council Solutions provide to its Constituent Councils.

Savings and Benefits

Expected outcomes of the procurement activity are achieved. These will be detailed as part of the procurement activity initiation and will be reported on upon the conclusion of the activity.

Timeliness

Procurement is undertaken within the agreed timeframes nominated as part of the procurement activity initiation and will be reported on upon conclusion of the activity.

6


Structure and Staffing

As at 30 June 2019, Council Solutions comprised five staff (4.8 FTE) delivering expertise in management, procurement, contract management, governance, policy, data analysis and administration skills. In addition, support has also been provided to the team by Rex Mooney, Financial Consultant.

The Council Solutions team comprises:

Manager - Clare Coupar

Senior Procurement Officers - Bruce Wright, Colin Owen, Tammy Sheridan,

Executive Support Officer - Audrey Rangel

Governance and Organisation Structure

Council Solutions Board

Council Solutions

Chief Executive Officer

Procurement and Project Committee

Constituent Council Procurement Leaders

Constituent Council Directors

Contract Development Team Members

Audit Committee

7


Procurement and Contract Management Achievements 2018 /19

Council Solutions manages a growing suite of collaborative contracts for its Constituent Councils that continue to deliver significant contract management efficiencies. The Regional Forward Procurement Plan, approved by the Council Solutions by the Board of Management in 2016, provides a roadmap to target collaborative procurement opportunities to deliver improved outcomes for Councils and ratepayers.

During 2018/19 over $68 million of Council expenditure was undertaken utilising Council Solutions collaborative contract arrangements. This represents an increase of 15% on the previous year.

The Council Solutions suite of 32 collaborative contracts and panel agreements, across 110 suppliers, covers a diverse and comprehensive range of categories to include Finance and Professional Services, Human Resources, Roads and Infrastructure, Facilities Management and Parks and Gardens. Our strong focus on contract management is key to extracting value from the contracts for both Councils and suppliers.

The Regional Forward Procurement Plan remained on track in the scheduling of procurement activities across target expenditure categories, with Council Solutions established new contracts for use by Constituent Councils for Cleaning Services, Supply and Delivery of Concrete, Managed Services (Unified Communications) and Segmental Pavers.

The most significant procurement projects undertaken by Council Solutions’ during 2018/19 were the Waste Management Services Project and the re-tendering of the Legal Service Panel.

Waste Management Services Project

Tenders for the Waste Management Services project were called in December 2018. The collaborative procurement of four Participating Councils will see alignment of waste management services across three service streams. The scale and value of the contracts will encourage industry competition to secure reliable tonnage of waste and strong cashflow to support investment in Material Recovery Facility infrastructure, improve data capture, reporting, encourage and support alternative waste technology and waste to energy as longer-term options for residual waste disposal. The new contract term will be for up to 10 years and will enable the support infrastructure investment as the total value of the three service streams is in the order of $25million per annum. Following evaluation and negotiation, contracts will be awarded in August 2019.

Legal Service Panel

The continuing collaboration in this category will provide the Constituent and accession Councils with a “Best of Breed” panel of legal firms to service the needs of the Councils. The benefit of maintaining the agreement is to provide a pre-approved panel of service providers, offering an agreed schedule of rates, with a mix of capability, experience and approach to ensure access to the best resources and information for councils.

8


Innovation and Continuous Improvement Initiatives

2018/19 saw the delivery of some exciting innovations and continuous improvement outcomes in collaboration with our infrastructure industry partners.

Bituminous Works Program (Downer EDI Works)

Approximately 100kms of the Participating Councils (the Cities of Charles Sturt, Marion, Onkaparinga, Salisbury, Tea Tree Gully and Mount Barker District Council) Councils’ road network was resurfaced.

The Councils lowered their carbon footprint by adopting sustainably manufactured asphalt products and reducing impacts on the environment.

With the use of Recycled Asphalt Pavement (RAP), the Councils have re-used product that would have potentially ended up as landfill. Collectively this is a total savings of 992 tonnes of Co₂ emissions, which is the equivalent of removing 393 cars from our road network per year.

In November 2018, Downer EDI Works introduced a new mix design ‘Reconophalt’, in response to increased demand from Councils to reduce landfill by using more recycled products. Reconophalt is an asphalt mix that included soft plastics and recycled glass and is capable of being developed to include other water materials. At total of 7467 tonne of Reconophalt was used by the Cities of Marion (3689t), Charles Sturt (3507t) and Onkaparinga (371t).

The Councils and Downer EDI Works continue to collaborate on the compaction review. Downer introduced new roller technology in January 2019 and several alternative mix designs were trialled throughout the year.

Several significant WHS initiatives were introduced to the contract during 2018/19 including engineered controlled reversing plant, forward sweeping brooms on skid steers, and traffic and pedestrian fencing segregation trials at Charles Sturt.

Crack Sealing Program (SuperSealing)

The Cities of Charles Sturt, Marion, Onkaparinga, Salisbury and Tea Tree Gully’s crack sealing program resulted in approximately 1.4 million m² of Councils’ combined road network being crack-sealed. In addition to extending the pavement life, this preventative maintenance saw the use of 550 recycled tyres that equates to the reduction of 115 household rubbish bins which are not going to landfill.

CoolSeal Product Trials (SuperSealing)

The Cities of Charles Sturt and Salisbury participated in trials of CoolSeal, a new and innovative road sealing product as part of studies to reduce the urban heat island effect in Council areas. This alternative product is a heat-reflective preservation treatment keeping roads cooler during warmer months and has the potential to significantly reduce surface temperatures of the road network.

The City of Charles Sturt sealed approx. 20,000m² in the Hendon Business precinct and Albert Park. The City of Salisbury sealed approx. 22,000m² and together with SuperSealing, receiving the IPWEA 2018/19 Excellence in Sustainable Solutions in Public Works award for the ‘The Bridges’ CoolSeal project at Mawson Lakes.

9


Contract Extensions

In addition, over the past 12 months Councils Solutions has facilitated the extensions of 6 existing collaborative contract arrangements with a combined total value of approximately $33.2 million per annum.

COUNCIL SOLUTIONS CONTRACT MANAGEMENT LIST AS AT 30 JUNE 2019

Contract / Panel Arrangement

2018/19 Expenditure $000

Temporary Labour Hire 28,533 Bituminous Works 20,665 Cleaning Services 3,859 Legal Services 3,451 Segmental Pavers 2,321 Arboriculture Services Panel Agreements • Tree Works Panel • Consultancy

2,189

Irrigation Services Agreements • Parts • Design • Minor Works

1,319

Leasing Finance of IT Equipment 1,303 Concrete 1,109 Quarry Materials 903 Architectural Services Panel Agreements • Architectural • Landscape Architecture • Urban Design

823

Crack Sealing 759 Postal Services

• Across Government Postal Services Postal Services – Post Bill Pay

616

Debt Collection Panel Agreement 494 Fencing Panel Agreement 338 Engineering Services Panel Agreements

• Building Services • Civil & Structural Engineering • Geotechnical Engineering • Process • Traffic & Transport Planning • Water & Environmental Engineering

200

Pest Control Services 6 Managed Services (Unified Communications) Not Applicable Rate & Dog Registration Not Applicable Transactional Banking Services Not Applicable

10


Finance

Operating Surplus Ratio

Council Solutions achieved a 21% favourable variance in its operating surplus ratio. This is reflective of the funding structure of this entity whereby revenue levels are maintained by contracts set up in prior years.

The better than budget operating result occurred primarily due to a few employee positions remaining vacant as a few employees moved on throughout the year. This accounts for most of the $440k better than budget result.

As fewer projects were undertaken than originally forecast, there were also savings in consultancy and legal fees. The lower levels of activity also delivered further savings in other non-salary expenditure lines.

Reimbursements are underbudget by $111k. This is primarily due to the overhead recoupment initially calculated to be reimbursed by Councils participating in the waste management services project that was recalculated at a lower level that reflected the reduction in operating costs referred to above. This is shown in ‘Other Income’ within the Statement of Comprehensive Income that follows.

Management fees were $44k less than budgeted for. This revenue varies from year to year in accordance with the level of Council usage of the various contracts in place.

Net Financial Liabilities Ratio

Net financial liabilities ratio saw a favourable variance of 18%. The data used to make this calculation is sourced from the Statement of Financial Position.

A negative result for this indicator means the Authority is in a Net Financial Assets situation.

Net Financial Assets have increased by $150k due to the better than budget operating result. The level of current assets is close to what was budgeted for, however current liabilities are less than originally budgeted for due to amounts payable to suppliers being settled late in June as well as the payment of the City of Adelaide loan account (‘Other Current Liabilities’).

The Authority continues to maintain high level of cash reserves.

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COUNCIL SOLUTIONS REGIONAL AUTHORITY General Purpose Financial Reports

for the year ending 30 June 2019

TABLE OF CONTENTS Page Certification of Financial Statements 2 Principal Financial Statements

Statement of Comprehensive Income 3

Statement of Financial Position 4

Statement of Changes in Equity 5

Statement of Cash Flows 5

Notes to, and forming part of, the Principal Financial Statements

Note 1 - Significant Accounting Policies 6

Note 2 - Income 8

Note 3 - Expenses 8

Note 4 - Current Assets 9

Note 5 - Liabilities 9

Note 6 - Reconciliation to Cash Flow Statement 10

Note 7 - Financial Instruments 11 Note 8 - Related Party Disclosures 12

Council Solutions Regional Authority's Certificate of Audit Independence

Audit Certificate of Audit Independence

Audit Report

12

Appendix A

2019 2018Notes $'000 $'000

INCOMEInvestment Income 2 7 4 Management Fees 2 1,056 1,054 Other Income 2 270 641 Total Income 1,333 1,699

EXPENSESMaterials, contracts & other expenses 3 960 1,770 Total Expenses 960 1,770

OPERATING SURPLUS / (DEFICIT) 373 (71)

NET SURPLUS / (DEFICIT) 373 (71)

Total Other Comprehensive Income - -

TOTAL COMPREHENSIVE INCOME 373 (71)

This Statement is to be read in conjunction with the attached Notes.

STATEMENT OF COMPREHENSIVE INCOMEfor the year ended 30 June 2019

COUNCIL SOLUTIONS REGIONAL AUTHORITY

14

2019 2018Notes $'000 $'000

ASSETSCurrent AssetsCash and cash equivalents 539 174 Receivables 342 564

Total Current Assets 4,7 881 738

Total Assets 881 738

LIABILITIESCurrent LiabilitiesTrade & Other Payables 37 124 Other Current Liabilties 15 158

Total Current Liabilities 5,7 52 282

Total Liabilities 5,7 52 282

NET ASSETS 829 456

EQUITYAccumulated Surplus 686 313 Share Capital 143 143 TOTAL EQUITY 829 456


BALANCE SHEETCOUNCIL SOLUTIONS REGIONAL AUTHORITY

as at 30 June 2019

15

Initial Contribution by Owners

Accumulated Surplus Total

2019 $'000 $'000 $'000

Opening Balance 143 313 456 Net Surplus for Year - 373 373 Balance at end of period 143 686 829



2018 $'000 $'000 $'000

Opening Balance 143 385 527 Net Surplus for Year - (71) (72)Balance at end of period 143 313 456

STATEMENT OF CHANGES IN EQUITYfor the year ended 30 June 2019


2019 2018Notes $'000 $'000

CASH FLOWS FROM OPERATING ACTIVITIESReceipts Operating receipts 1,548 1,600 Investment Income 7 4 Payments Operating payments to suppliers & employees (1,190) (1,764) Net Cash provided by (or used in) Operating Activities 365 (160)

Net Increase (Decrease) in cash held 365 (160)

Cash & cash equivalents at beginning of period 174 334 Cash & cash equivalents at end of period 6 539 174

This Statement is to be read in conjunction with the attached Notes

for the year ended 30 June 2019CASH FLOW STATEMENT

16


Notes to and forming part of the Financial Statements for the year ending 30 June 2019

Note 1 - Significant Accounting Policies 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. Council Solutions Regional Authority is a Regional Subsidiary under Section 43 and Schedule 2 of the Local Government Act 1999. The Constituent Councils and their respective share of equity are as follows:

Constituent Council Equity Share

Adelaide City Council 16.67% City of Charles Sturt 16.67% City of Marion 16.67% City of Onkaparinga 16.67% City of Salisbury 16.67% City of Tea Tree Gully 16.67%

The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial report was authorised for issue by certificate under regulation 14 of the Local Government (Financial Management) Regulations 2011.

1 Basis of Preparation The financial report has been prepared on an accruals basis and is based on historical costs. All amounts in the financial statements have been rounded to the nearest thousand dollars ($’000).

2 Income recognition Management Fee Income is recognised when the Constituent Councils enter into the purchase of a good or service from a Supplier contracted to provide the Authority (or in the case of some prior contracts that were created jointly between the six constituent Council) with a Management Fee.

3 Cash, Cash Equivalents and other Financial Instruments Cash Assets include all amounts readily convertible to cash on hand at the Authority’s option with an insignificant risk of changes in value with a maturity of three months or less from the date of acquisition. 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.

4 Infrastructure, Property, Plant & Equipment The Authority did not procure any non-current assets during the reporting period and does not hold any non-current assets as at the reporting date.

5 Employee Benefits All employees are employed through Adelaide City Council, one of the Constituent Councils. Those employees are then contracted to the Authority.

17



6 GST Implications In accordance with UIG Abstract 1031 “Accounting for the Goods & Services Tax”:

- Receivables and Creditors include GST receivable and payable. - Except in relation to input taxed activities, revenues and operating expenditures exclude GST

receivable and payable. - Amounts included in the Statement of Cash Flows are disclosed on a gross basis.

7 Comparative Information Comparative information has been reclassified to be consistent with the current year disclosure of equivalent information in accordance with Australian Accounting Standards.

8 Critical Accounting Estimates and Judgements The Authority evaluates estimates and judgements incorporated into the financial report based on historical knowledge and best available current information.

Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the authority.

Accounts receivable are reviewed at each reporting date to establish the collectability.

9 Pending Accounting Standards Certain new accounting standards and UIG interpretations have been published that are not mandatory for the 30 June 2019 reporting period and have not been used in preparing these reports.

AASB 7 Financial Instruments – Disclosures

AASB 9 Financial Instruments

AASB 15 Revenue from Contracts with Customers

AASB 16 Leases

AASB 1058 Income of Not-for-Profit Entities

Standards containing consequential amendments to other Standards and Interpretations arising from the above - AASB 2010-7, AASB 2014-1, AASB 2014-3, AASB 2014-4, AASB 2014-5, AASB 2014-6, AASB 2014-7, AASB 2014-8, AASB 2014-9, AASB 2014-10, AASB 2015-1, AASB 2015-2, AASB 2015-3, AASB 2015-4, AASB 2015-5, AASB 2015-6 and AASB 2015-7.

(Standards not affecting local government have been excluded from the above list.)

AASB 16 Leases, which will commence from 1 July 2019, requires that the right of use conveyed by leasing contracts ‐ except leases with a maximum term of 12 months and leases for non‐material amounts ‐ be recognised as a form of Infrastructure, Property, Plant and Equipment, and that the lease liability be disclosed as a liability.

At 30 June 2019, Council has no leases to which this treatment will need to be applied.

18

2019 2018$'000 $'000

INVESTMENTSInterest Income 7 4

7 4 REBATESManagement Fees 1,056 1,054

1,056 1,054 OTHER INCOME Reimbursements 270 641

270 641

COUNCIL SOLUTIONS REGIONAL AUTHORITYNOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS

for the year ended 30 June 2019

Note 2 - INCOME

2019 2018$'000 $'000

MATERIALS, CONTRACTS & OTHER EXPENSESAdvertising 0 1 Audit Fees 4 4 Catering 1 1 Contractors 40 45 Consultant Fees 92 532 Insurance 28 27 IT Expenses 23 34 Legal Fees 35 63 Membership Fees & Subscriptions 5 4 Motor Vehicle 2 2 Reimbursements - Salary & Wages 665 982 Rent 27 26 Sitting Fees 19 32 Sundry 13 13 Telephone 2 2 Training and Development 4 2

960 1,770

Note 3 - EXPENSES

19

2019 2018$'000 $'000

CASH & CASH EQUIVALENTSCash at Bank 539 174

539 174

RECEIVABLES Accounts Receivables 226 419 Accrued Income 116 143 Prepaid Expenses - 2

342 564

TOTAL CURRENT ASSETS 881 738



Note 4 - CURRENT ASSETS

2019 2018$'000 $'000

TRADE & OTHER PAYABLESCreditors 28 120 Expenses Accrued 9 4

37 124 OTHER CURRENT LIABILITIESPayable to Adelaide City Council 15 158

15 158

TOTAL LIABILITIES 52 282

Note 5 - LIABILITIES

20

Note 6 - RECONCILIATION TO CASH FLOW STATEMENT

(a) Reconciliation of Cash

2019 2018$'000 $'000

Cash at Bank 539 174 Balances per Cash Flow Statement 539 174

(b) Reconciliation of Change in Net Assets to Cash from Operating ActivitiesNet Surplus 373 (71) Net (increase)/decrease in Receivables 222 (95) Net increase/(decrease) in Current Liabilities (230) 6 Net Cash provided by (or used in) operations 365 (160)



Cash Assets comprise highly liquid investments with short periods to maturity subject to insignificant risk of changes of value. Cash at the end of the reporting period as shown in the Cash Flow Statement is reconciled to the related items in the Balance Sheet.

21

Note 7 - FINANCIAL INSTRUMENTS(a) Interest Rate Risk

2018-19Weighted Average

Interest Rate

Fair Value of Variable

Interest Rate Instruments

Fair Value of Fixed Interest

rate instruments

maturing within One

Year


rate instruments

maturing Due > 1 less 5 Yrs


rate instruments

maturing Due > 5 Yrs

Fair Value of Non-Interest

Bearing Instruments

$'000 $'000 $'000 $'000 $'000

Financial Assets:Cash 1.9% 539 - - - 539 Receivables 0.0% - - - - 342 Total Financial Assets 539 - - - 881

Financial Liabilities:Creditors and Provisions 0.0% - - - - 52 Total Financial Liabilities - - - - 52


Interest Rate




rate instruments

maturing within One

Year


rate instruments



rate instruments



Bearing Instruments

$'000 $'000 $'000 $'000 $'000



(b) Credit RiskCredit Risk respresents the loss that would be recognised if other entities failed to perform as contracted.The Authority's exposure to credit risk is summarised as follows;

(c) Net Fair ValueThe net fair value of a financial instrument is defined as its value net of all costs to settle the asset and liability.

Due to the nature of financial instruments held in the Authority, the cost associated with their settlement would not be material, and hence, have not been considered.



The Authority's exposure to interest rate risk, which is the risk that the value of a financial instrument will fluctuate as a result of changes in market interest rates, and the effective weighted average interest rates on those applicable financial assets and liabilities is as follows;

Receivables - the Authority's maximum exposure is disclosed in the financial statements net of any provision for doubtful debts

The financial assets and liabilities as stated or referred to in notes (a) and (b) above, are stated at their face value (less provision for doubtful debts if applicable).

22

COUNCIL SOLUTIONS REGIONAL AUTHORITY NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS


Note 8 - RELATED PARTY DISCLOSURES

KEY MANAGEMENT PERSONNEL The Key Management Personnel of the Council include the Chair of the Board, the Board, Independent Members of the Audit Committee and the CEO, Acting CEO and General Manager. Salaries, allowances & other short term benefits paid by Council Solutions to KMP were $232k (2018-19) and $259k (2017-18) The following qualifying related party disclosures have been identified in relation to the 2018-19 financial year

Related Party Entity

Amounts received from related parties

during 2018-19 FY

Amounts outstanding from related

parties as at 30 June 2019

Amounts outstanding to related parties as at 30 June

2019

$ ‘000 $ ‘000 $ ‘000

City of Adelaide 112 26 -

City of Charles Sturt 116 26 -

City of Marion 100 - -

City of Salisbury 3 - -

City of Tea Tree Gully 3 - -

City of Onkaparinga 3 - -

The above amounts received represent reimbursements of designated project costs paid by the above listed Constituent Councils to Council Solutions at various times throughout the year. These amounts have been approved by the Board and reported on as part of the ongoing annual budget setting and budget review process. Council Solutions provides procurement services to the above listed entities.

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15 August 2019 15 August 2019

24

Ian G McDonald FCA

www.creativeauditing.com.au

Ian 0419 620 906 PO Box 75, Henley Beach SA 5022 Nancy 0408 832 848 [email protected] ABN 13 550 494 869 [email protected]


ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2019

STATEMENT BY AUDITOR

We confirm that, for the audit of the financial statements of the Council Solutions Regional Authority for the year ended 30 June 2019, we have maintained our independence in accordance with the requirements of APES 110 – Code of Ethics for Professional Accountants, Section 290, published by the Accounting Professional and Ethical Standards Board, 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.

Ian G McDonald FCA

Dated this 2nd day of August 2019

25

mailto:[email protected]


Ian G McDonald FCA



Council Solutions Regional Authority Independent Auditor’s Report

We have audited the attached financial statements, being a general purpose financial report, of Council Solutions Regional Authority for the year ended 30 June 2019. Opinion In our opinion, the financial statements of the Authority are properly drawn up:

a) to present fairly the financial position of the Authority as at the 30 June 2019 and the results of its operations for the period then ended, and;

b) according to Australian Accounting Standards. Basis for Opinion For the audit of the Authority we have maintained our independence in accordance with the relevant ethical requirements of APES 110 Section 290. We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a basis for our opinion. Other Information – Basis of Accounting and Restriction on Distribution Without modifying our opinion, we draw attention to Note 1 to the financial report, which describes the basis of accounting. The financial report is prepared to assist the authority to meet the requirements of Local Government Act 1999 together with the Local Government (Financial Management Regulations 2011. As a result, the financial report may not be suitable for another purpose. Our report is intended solely for the members. Responsibilities of Management for the Financial Report The Board of Management is responsible for the preparation of the financial report in accordance with Local Government Act 1999 together with the Local Government (Financial Management Regulations 2011 and for such internal control as management determines is necessary to enable the preparation of a financial report that is free from material misstatement, whether due to fraud or error. Auditor’s Responsibilities for the Audit of the Financial Report Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the schedule is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement in the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the association's preparation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the association's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Ian G McDonald FCA Registered Company Auditor Dated at Grange this 2nd day of September 2019

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Appendix B

Audit Committee Annual Report to the Board for the Year Ending 30 June 2019

Audit Committee

The Council Solutions Board is supported by one designated committee being the Audit Committee which is formally appointed pursuant to the requirements under the Local Government Act 1999 (the Act) and the Local Government (Financial Management) Regulations 2013.

The function of the Audit Committee includes reviewing annual financial statements to ensure that they present fairly the Authority’s state of affairs and reviewing the adequacy of financial management systems and practices.

This report provides a summary of activities undertaken by the Audit Committee during the Year Ending 30 June 2019.

Committee Membership and Meetings Attended

The Audit Committee met on 4 occasions during the financial year.

Member Meetings Attended

Ms Tanya Johnston, Chair and Independent Member 4

Mr David Papa, Independent Member 4

Mr John Moyle, Board member 3

Mr Adrian Skull, Proxy Board Member 1

Activities

The Audit Committee is governed by a Terms of Reference with the work flow controlled by an Audit Committee Work Program. The Audit Committee Work program is updated after each meeting to reflect Committee achievements as well as to include actions arising from the meeting as well as from Board meetings.

The table that follows represents the completed work program for the meetings held in the year ending 30 June 2019.

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Completed Work Program 2018/19

ACTIVITY MEETING DATE

1. Financial Reporting

Monitor the integrity of the financial statement reports referred to below to review any significant financial reporting issues and judgements which they may contain.

Specifically - review and challenge where necessary:

• the consistency in application of, and/or any changes to, accounting policies; • the method used to account for significant or unusual transactions where

different approaches are possible; • whether the Authority has followed appropriate accounting standards and

made appropriate estimates and judgements, considering the views of the external auditor;

• the clarity of disclosure in the Authority’s financial reports and the context in which statements are made;

• all information presented with the financial statements, such as the operating and financial review and the corporate governance statement (in so far as it relates to the audit and risk management); and significant adjustments to the financial report (if any) arising from the audit process.

1.1 Annual Financial Statements – 2017/18 Sep 2018

1.2 Financial Performance Report – 2017/18 Sep 2018

1.3 Budget Review #1 – 2018/19 Dec 2018

1.4 Annual Budget – 2019/20 Apr 2019

Jun 2019

1.5 Budget Review #2 – 2018/19 Apr 2019

1.6 Budget Review #3 – 2018/19 Jun 2019

2. Internal Controls and Risk Management Systems

2.1 Review and comment on internal control policy and operational framework. Dec 2018

2.2 Review and comment on updated risk register including the risk assessment framework used when completed.

Dec 2018

2.3 Review and comment on the disaster recovery plan as well as a business continuity plan when completed.

Dec 2018

3. Internal Audit

3.1 Consider and make recommendations on the scope and function of an internal audit program suitable for an operational structure and size of Council Solutions.

Dec 2018

28


4. External Audit

4.1 Liaise with the Authority’s external auditor on the scope and planning of annual audits, including any issues arising from audits and the resolution of such matters.

Sep 2018

4.2 Review the findings of any external audit report that raises significant issues relating to risk management, accounting, internal controls, financial reporting and other accountability or governance issues and make recommendations to the Board where appropriate.

Sep 2018

4.3 All correspondence between the Auditor and Council is to be tabled for consideration. The audit committee will review and comment on the Authority’s response to, and actions taken following issues raised from any external audit.

Ongoing

4.4 Ensure compliance with Clause 22 of the Local Government (Financial Management) Regulations 1999 regarding the prohibition of auditors providing additional non-audit services.

Sep 2018

4.5 Review and recommend the engagement of the Authority’s external auditor, including the appointment, reappointment, and removal of the Authority’s external auditor. The review should look to satisfy the Board that the external audit services can demonstrate adequate independence from the operations of the Authority.

Jun 2019

4.6 Chair of Audit Committee to meet with the Chair of the Board to discuss on-going matters with the parties would help identify risks from a governance perspective

Sep 2018

4.7 Chair of Audit Committee to meet with the external Auditors to discuss on-going matters with the parties would help identify risks from a governance perspective

Sep 2018

5. Reporting Requirements of the Audit Committee

5.1 Ensure that significant, urgent matters identified through the work program are formally and promptly reported to the Board.

Ongoing

5.2 Table the minutes of Audit Committee meetings held as part of the agenda of the next Board meeting, ensuring recommendations are considered and adopted as required.

Ongoing

5.3 Prepare annually a report to the Board on the Audit Committees performance over the past year and include the report in the Annual Report of Council Solutions.

Sep 2018

5.4 Review its own performance and Terms of Reference on an annual basis.

Dec 2018

29


6. Other

6.1 Set Audit Committee work program and Confirm meeting dates for 2019. Dec 2018

6.2 Audit Committee Chairperson Appointment Jun 2019

6.3 Management Fee Audit. Update Report. Dec 2018

6.4 Review and comment on the following policies:

• Petty cash/credit cards

• Accounting/financial management

• Procurement – contract and tendering

• Financial delegations

Dec 2018

30

COUNCIL SOLUTIONS REGIONAL AUTHORITY General Purpose Financial Reports

for the year ending 30 June 2019

TABLE OF CONTENTS Page Certification of Financial Statements 2 Principal Financial Statements

Statement of Comprehensive Income 3

Statement of Financial Position 4

Statement of Changes in Equity 5

Statement of Cash Flows 5

Notes to, and forming part of, the Principal Financial Statements

Note 1 - Significant Accounting Policies 6

Note 2 - Income 8

Note 3 - Expenses 8

Note 4 - Current Assets 9

Note 5 - Liabilities 9

Note 6 - Reconciliation to Cash Flow Statement 10

Note 7 - Financial Instruments 11 Note 8 - Related Party Disclosures 12

Council Solutions Regional Authority's Certificate of Audit Independence

Audit Certificate of Audit Independence

Audit Report

Appendix A

2019 2018Notes $'000 $'000

INCOMEInvestment Income 2 7 4 Management Fees 2 1,056 1,054 Other Income 2 270 641 Total Income 1,333 1,699

EXPENSESMaterials, contracts & other expenses 3 960 1,770 Total Expenses 960 1,770

OPERATING SURPLUS / (DEFICIT) 373 (71)

NET SURPLUS / (DEFICIT) 373 (71)

Total Other Comprehensive Income - -

TOTAL COMPREHENSIVE INCOME 373 (71)


STATEMENT OF COMPREHENSIVE INCOMEfor the year ended 30 June 2019


2019 2018Notes $'000 $'000

ASSETSCurrent AssetsCash and cash equivalents 539 174 Receivables 342 564

Total Current Assets 4,7 881 738

Total Assets 881 738

LIABILITIESCurrent LiabilitiesTrade & Other Payables 37 124 Other Current Liabilties 15 158

Total Current Liabilities 5,7 52 282

Total Liabilities 5,7 52 282

NET ASSETS 829 456

EQUITYAccumulated Surplus 686 313 Share Capital 143 143 TOTAL EQUITY 829 456


BALANCE SHEETCOUNCIL SOLUTIONS REGIONAL AUTHORITY

as at 30 June 2019



2019 $'000 $'000 $'000

Opening Balance 143 313 456 Net Surplus for Year - 373 373 Balance at end of period 143 686 829



2018 $'000 $'000 $'000

Opening Balance 143 385 527 Net Surplus for Year - (71) (72)Balance at end of period 143 313 456

STATEMENT OF CHANGES IN EQUITYfor the year ended 30 June 2019


2019 2018Notes $'000 $'000

CASH FLOWS FROM OPERATING ACTIVITIESReceipts Operating receipts 1,548 1,600 Investment Income 7 4 Payments Operating payments to suppliers & employees (1,190) (1,764) Net Cash provided by (or used in) Operating Activities 365 (160)

Net Increase (Decrease) in cash held 365 (160)

Cash & cash equivalents at beginning of period 174 334 Cash & cash equivalents at end of period 6 539 174

This Statement is to be read in conjunction with the attached Notes

for the year ended 30 June 2019CASH FLOW STATEMENT



Note 1 - Significant Accounting Policies 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. Council Solutions Regional Authority is a Regional Subsidiary under Section 43 and Schedule 2 of the Local Government Act 1999. The Constituent Councils and their respective share of equity are as follows:

Constituent Council Equity Share

Adelaide City Council 16.67% City of Charles Sturt 16.67% City of Marion 16.67% City of Onkaparinga 16.67% City of Salisbury 16.67% City of Tea Tree Gully 16.67%

The principal accounting policies adopted in the preparation of the financial report are set out below. These policies have been consistently applied to all the years presented, unless otherwise stated. The financial report was authorised for issue by certificate under regulation 14 of the Local Government (Financial Management) Regulations 2011.

1 Basis of Preparation The financial report has been prepared on an accruals basis and is based on historical costs. All amounts in the financial statements have been rounded to the nearest thousand dollars ($’000).

2 Income recognition Management Fee Income is recognised when the Constituent Councils enter into the purchase of a good or service from a Supplier contracted to provide the Authority (or in the case of some prior contracts that were created jointly between the six constituent Council) with a Management Fee.

3 Cash, Cash Equivalents and other Financial Instruments Cash Assets include all amounts readily convertible to cash on hand at the Authority’s option with an insignificant risk of changes in value with a maturity of three months or less from the date of acquisition. 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.

4 Infrastructure, Property, Plant & Equipment The Authority did not procure any non-current assets during the reporting period and does not hold any non-current assets as at the reporting date.

5 Employee Benefits All employees are employed through Adelaide City Council, one of the Constituent Councils. Those employees are then contracted to the Authority.



6 GST Implications In accordance with UIG Abstract 1031 “Accounting for the Goods & Services Tax”:

- Receivables and Creditors include GST receivable and payable. - Except in relation to input taxed activities, revenues and operating expenditures exclude GST

receivable and payable. - Amounts included in the Statement of Cash Flows are disclosed on a gross basis.

7 Comparative Information Comparative information has been reclassified to be consistent with the current year disclosure of equivalent information in accordance with Australian Accounting Standards.

8 Critical Accounting Estimates and Judgements The Authority evaluates estimates and judgements incorporated into the financial report based on historical knowledge and best available current information.

Estimates assume a reasonable expectation of future events and are based on current trends and economic data, obtained both externally and within the authority.

Accounts receivable are reviewed at each reporting date to establish the collectability.

9 Pending Accounting Standards Certain new accounting standards and UIG interpretations have been published that are not mandatory for the 30 June 2019 reporting period and have not been used in preparing these reports.

AASB 7 Financial Instruments – Disclosures

AASB 9 Financial Instruments

AASB 15 Revenue from Contracts with Customers

AASB 16 Leases

AASB 1058 Income of Not-for-Profit Entities

Standards containing consequential amendments to other Standards and Interpretations arising from the above - AASB 2010-7, AASB 2014-1, AASB 2014-3, AASB 2014-4, AASB 2014-5, AASB 2014-6, AASB 2014-7, AASB 2014-8, AASB 2014-9, AASB 2014-10, AASB 2015-1, AASB 2015-2, AASB 2015-3, AASB 2015-4, AASB 2015-5, AASB 2015-6 and AASB 2015-7.

(Standards not affecting local government have been excluded from the above list.)

AASB 16 Leases, which will commence from 1 July 2019, requires that the right of use conveyed by leasing contracts ‐ except leases with a maximum term of 12 months and leases for non‐material amounts ‐ be recognised as a form of Infrastructure, Property, Plant and Equipment, and that the lease liability be disclosed as a liability.

At 30 June 2019, Council has no leases to which this treatment will need to be applied.

2019 2018$'000 $'000

INVESTMENTSInterest Income 7 4

7 4 REBATESManagement Fees 1,056 1,054

1,056 1,054 OTHER INCOME Reimbursements 270 641

270 641



Note 2 - INCOME

2019 2018$'000 $'000

MATERIALS, CONTRACTS & OTHER EXPENSESAdvertising 0 1 Audit Fees 4 4 Catering 1 1 Contractors 40 45 Consultant Fees 92 532 Insurance 28 27 IT Expenses 23 34 Legal Fees 35 63 Membership Fees & Subscriptions 5 4 Motor Vehicle 2 2 Reimbursements - Salary & Wages 665 982 Rent 27 26 Sitting Fees 19 32 Sundry 13 13 Telephone 2 2 Training and Development 4 2

960 1,770

Note 3 - EXPENSES

2019 2018$'000 $'000

CASH & CASH EQUIVALENTSCash at Bank 539 174

539 174

RECEIVABLES Accounts Receivables 226 419 Accrued Income 116 143 Prepaid Expenses - 2

342 564

TOTAL CURRENT ASSETS 881 738



Note 4 - CURRENT ASSETS

2019 2018$'000 $'000

TRADE & OTHER PAYABLESCreditors 28 120 Expenses Accrued 9 4

37 124 OTHER CURRENT LIABILITIESPayable to Adelaide City Council 15 158

15 158

TOTAL LIABILITIES 52 282

Note 5 - LIABILITIES

Note 6 - RECONCILIATION TO CASH FLOW STATEMENT

(a) Reconciliation of Cash

2019 2018$'000 $'000

Cash at Bank 539 174 Balances per Cash Flow Statement 539 174

(b) Reconciliation of Change in Net Assets to Cash from Operating ActivitiesNet Surplus 373 (71) Net (increase)/decrease in Receivables 222 (95) Net increase/(decrease) in Current Liabilities (230) 6 Net Cash provided by (or used in) operations 365 (160)



Cash Assets comprise highly liquid investments with short periods to maturity subject to insignificant risk of changes of value. Cash at the end of the reporting period as shown in the Cash Flow Statement is reconciled to the related items in the Balance Sheet.

Note 7 - FINANCIAL INSTRUMENTS(a) Interest Rate Risk


Interest Rate




rate instruments

maturing within One

Year


rate instruments



rate instruments



Bearing Instruments

$'000 $'000 $'000 $'000 $'000




Interest Rate




rate instruments

maturing within One

Year


rate instruments



rate instruments



Bearing Instruments

$'000 $'000 $'000 $'000 $'000



(b) Credit RiskCredit Risk respresents the loss that would be recognised if other entities failed to perform as contracted.The Authority's exposure to credit risk is summarised as follows;

(c) Net Fair ValueThe net fair value of a financial instrument is defined as its value net of all costs to settle the asset and liability.

Due to the nature of financial instruments held in the Authority, the cost associated with their settlement would not be material, and hence, have not been considered.



The Authority's exposure to interest rate risk, which is the risk that the value of a financial instrument will fluctuate as a result of changes in market interest rates, and the effective weighted average interest rates on those applicable financial assets and liabilities is as follows;

Receivables - the Authority's maximum exposure is disclosed in the financial statements net of any provision for doubtful debts

The financial assets and liabilities as stated or referred to in notes (a) and (b) above, are stated at their face value (less provision for doubtful debts if applicable).

COUNCIL SOLUTIONS REGIONAL AUTHORITY NOTES TO AND FORMING PART OF THE FINANCIAL STATEMENTS


Note 8 - RELATED PARTY DISCLOSURES

KEY MANAGEMENT PERSONNEL The Key Management Personnel of the Council include the Chair of the Board, the Board, Independent Members of the Audit Committee and the CEO, Acting CEO and General Manager. Salaries, allowances & other short term benefits paid by Council Solutions to KMP were $232k (2018-19) and $259k (2017-18) The following qualifying related party disclosures have been identified in relation to the 2018-19 financial year

Related Party Entity

Amounts received from related parties

during 2018-19 FY

Amounts outstanding from related

parties as at 30 June 2019

Amounts outstanding to related parties as at 30 June

2019

$ ‘000 $ ‘000 $ ‘000

City of Adelaide 112 26 -

City of Charles Sturt 116 26 -

City of Marion 100 - -

City of Salisbury 3 - -

City of Tea Tree Gully 3 - -

City of Onkaparinga 3 - -

The above amounts received represent reimbursements of designated project costs paid by the above listed Constituent Councils to Council Solutions at various times throughout the year. These amounts have been approved by the Board and reported on as part of the ongoing annual budget setting and budget review process. Council Solutions provides procurement services to the above listed entities.

15 August 2019 15 August 2019

Ian G McDonald FCA




ANNUAL FINANCIAL STATEMENTS

For the year ended 30 June 2019

STATEMENT BY AUDITOR

We confirm that, for the audit of the financial statements of the Council Solutions Regional Authority for the year ended 30 June 2019, we have maintained our independence in accordance with the requirements of APES 110 – Code of Ethics for Professional Accountants, Section 290, published by the Accounting Professional and Ethical Standards Board, 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.

Ian G McDonald FCA

Dated this 2nd day of August 2019



Ian G McDonald FCA



Council Solutions Regional Authority Independent Auditor’s Report

We have audited the attached financial statements, being a general purpose financial report, of Council Solutions Regional Authority for the year ended 30 June 2019. Opinion In our opinion, the financial statements of the Authority are properly drawn up:

a) to present fairly the financial position of the Authority as at the 30 June 2019 and the results of its operations for the period then ended, and;

b) according to Australian Accounting Standards. Basis for Opinion For the audit of the Authority we have maintained our independence in accordance with the relevant ethical requirements of APES 110 Section 290. We believe that the audit evidence that we have obtained is sufficient and appropriate to provide a basis for our opinion. Other Information – Basis of Accounting and Restriction on Distribution Without modifying our opinion, we draw attention to Note 1 to the financial report, which describes the basis of accounting. The financial report is prepared to assist the authority to meet the requirements of Local Government Act 1999 together with the Local Government (Financial Management Regulations 2011. As a result, the financial report may not be suitable for another purpose. Our report is intended solely for the members. Responsibilities of Management for the Financial Report The Board of Management is responsible for the preparation of the financial report in accordance with Local Government Act 1999 together with the Local Government (Financial Management Regulations 2011 and for such internal control as management determines is necessary to enable the preparation of a financial report that is free from material misstatement, whether due to fraud or error. Auditor’s Responsibilities for the Audit of the Financial Report Our responsibility is to express an opinion on the financial report based on our audit. We conducted our audit in accordance with Australian Auditing Standards. Those standards require that we comply with relevant ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the schedule is free from material misstatement. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report. The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement in the financial report, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the association's preparation of the financial report in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the association's internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion. Ian G McDonald FCA Registered Company Auditor Dated at Grange this 2nd day of September 2019




159

571 Montague Road, Modbury 5092 PO Box 571, Modbury 5092

Telephone 8397 7444 cttg.sa.gov.au