CHIEF FINANCIAL OFFICER’S REPORT
In 2015/16 our operating result was a surplus of $77.9 million which reflects our sound financial position and commitment to robust financial management.
Other features of the 2015/16 result include:
It should be noted that this result was influenced by two significant items being the receipt of $43 million in capital income, which mainly relates to developer contributions, and $23.3 million increase in the value of our investment properties. While these items contribute to a significant surplus they do not impact on our funding for ordinary operations.
• We received approximately 52 percent of our revenue (excluding capital) from rates and annual charges and have consistently achieved an excellent recovery rate with only 3.58 percent of rates outstanding
We aim to produce an operating surplus before capital so that the regular costs incurred by Council in our normal day‑today service delivery operations are less than revenue received from providing these services. In 2015/16, excluding the $23.3 million which relates to a revaluation of investment properties, our surplus before capital was $11 million. Achieving these results allows the City of Ryde to generate sufficient funds to replace assets and deliver strategic projects. It is one of the keys to our long-term financial sustainability. In 2015/16 we spent $34 million on our capital programs which included $26 million on renewing or building infrastructure assets.
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City of Ryde Annual Report 2015/16
• Working capital of $4.5 million, to cover day-to-day operations and provide a buffer for unforeseen expenditure
• Our unrestricted current ratio, which is a measure of our capacity to satisfy short‑term obligations, remained stable with a ratio of 4.29 to 1 (above the industry benchmark of 1.50 to 1) • Our level of internal reserves (funds put aside for specific projects) is $82.9 million. While our financial indicators, as attested to by our auditors Pricewaterhouse Coopers, reflect that we are in a sound financial position, similar to all local governments across Australia, the City of Ryde will continue to face a number of challenges in the years ahead associated with maintaining and improving infrastructure. In 2015/16 we began our new asset renewal program based on the special rate variation (SRV) approved by the Independent Pricing and Regulatory Tribunal in May 2015. The SRV provided for $2.3 million in additional rates revenue which funded $1.8 million in road resurfacing renewal, $200,000 in footpath construction renewal and $300,000 in asset maintenance beyond what would have otherwise been provided.
We continue to address our long-term financial sustainability through our Long Term Financial Plan which we review on an annual basis. Further information on our financial performance is contained in the Community Financial Report from page 24 and Financial Statements from page 137.
Christine Joyce Acting Chief Financial Officer City of Ryde