Strategic Objective 5 - Responsible Financial Sustainability
Financial Sustainability
Financial Performance
Council's Net Result for the 2006/07 Reporting Period was $9.0M, ostensibly a decline from the $13.3M surplus reported in 2005/06. Both years' results include unbudgeted non-cash developer contributions of roads and other infrastructure assets. The 2006/07 year also includes a State Government contribution of $4.3M to the Clayton Community Centre Project to finance the inclusion of Monashlink Services.
After adjusting for this and the non-cash items in both years, Council's underlying comparative result is:
- 2006/07 Deficit of $1,219K
- 2005/06 Deficit of $1,887K
This underlying deficit largely reflects an unfunded portion of depreciation. In 2006/07, Council provided $15.6 million from recurrent revenue sources for its Base Capital Works program. As the chart below indicates, the funding allocation for this program has increased markedly since 2000/01 as the annual ongoing requirements to maintain the City's existing infrastructure have become, through the development of Asset Management Plans (AMPs), more clearly identified and quantified.
While the difference between annual depreciation and the base capital works program is not considered material given the current age and condition of Council assets, the continuing development of Plans for the management of each category of community asset will ensure funding allocations more closely align with the renewal requirements of the City's infrastructure.
The 2007/08 Base Capital Works Budget includes an increased allocation of funds for several large building and sports pavilion upgrades.
Note: Base Capital Expenditure is shown net of trade-in revenue. Financial Plans for 2004/05 -2007/08 shows gross plant & equipment expenditure in Base Capital Expenditure.
Published: 22 November 2007
[ Up: Financial Sustainability | Forward: Revenue ]