WARRNAMBOOL City and Moyne Shire councils have reported surpluses last financial year which will buffer them for a challenging period ahead.
Statutory financial statements sent to the Auditor-General show Moyne’s comprehensive surplus of $3.93m was $3.3m higher than expected.
Warrnambool City’s $7.919m comprehensive surplus was $4.3m below budget.
But the underlying performance results show a different picture when capital grants, gifted assets, developer contributions and the latest superannuation shortfall obligation are subtracted.
Warrnambool’s underlying surplus of $879,000 was $209,000 better than expected. Moyne said its underlying surplus was $3.54m.
Warrnambool City’s corporate strategies director Kevin Leddin said the result would enable the council to retain its low-risk rating.
He said the standard income statement report was misleading without explanation because councils were required to include the latest bill for the defined benefits superannuation scheme shortfall even though it didn’t have to be paid until next July.
“It is required to be recognised now as a non-recurrent liability,” he said.
Audit committee member Michael Neoh said it was a challenge for councillors to decide how to pay the $4.78m due next financial year.
“We need to have a resource plan between now and then on how it is to be funded,” Cr Neoh said.
“It will be a decision on whether it’s a reduction in capital works, a loan or rates rise.”
Highlights of the Warrnambool City performance are:
Income: rates $26.23m,service user fees $13.73m, operating grants $12.4m, capital grants $6.5m, developer cash contributions $3.3m, fees and fines $1.18m; and
Expenses: materials, services and contracts $24.34m, employee benefits $22.88m (including $20.6m in wages), depreciation $8.75m, net loss on disposal of property, infrastructure, plant and equipment $537,000.
Moyne’s highlights are:
Income: general rates $15.3m, operating grants $14.5m, capital grants $2.4m, fees and charges $12.96m; and
Expenses: employee costs $13.87m (including $11.5m in wages), materials and services $15.7m.