Agenda of Extraordinary Meeting of Council

Reports submitted to the Extraordinary Meeting of Council to be held on Monday 27 November 2023.

Extraordinary Meeting of Council AGENDA AND BUSINESS PAPER

Monday 27 November 2023

ORDER OF BUSINESS:

CLAUSE PRECIS PAGE

ACKNOWLEDGEMENT OF COUNTRY 2

REFLECTION 2

APOLOGIES 2

Confirmation of Minutes

CM-1 ORDINARY COUNCIL MEETING - 20 NOVEMBER 2023 2

DECLARATIONS OF INTEREST 2

Reports from Staff

RP-1 ANNUAL FINANCIAL STATEMENTS 2022/23 3

ACKNOWLEDGEMENT OF COUNTRY

Wagga Wagga City Council acknowledges the traditional custodians of the land, the Wiradjuri people, and pays respect to Elders past, present and future and extends our respect to all First Nations Peoples in Wagga Wagga.

We recognise and respect their cultural heritage, beliefs and continuing connection with the land and rivers. We also recognise the resilience, strength and pride of the Wiradjuri and First Nations communities

REFLECTION

Councillors, let us in silence reflect upon our responsibilities to the community which we represent, and to all future generations and faithfully, and impartially, carry out the functions, powers, authorities and discretions vested in us, to the best of our skill and judgement.

APOLOGIES

Confirmation of Minutes

CM-1 ORDINARY COUNCIL MEETING - 20 NOVEMBER 2023

Recommendation

That the Minutes of the proceedings of the Ordinary Council Meeting held on 20 November 2023 be confirmed as a true and accurate record.

Attachments

1 ⇩.

Minutes - 20 November 2023

130

DECLARATIONS OF INTEREST

Report submitted to the Extraordinary Meeting of Council on Monday 27 November 2023

RP-1

Reports from Staff

RP-1 ANNUAL FINANCIAL STATEMENTS 2022/23

Summary:

The 2022/23 financial statements have been completed by Council staff and have recently been audited by the NSW Audit Office.

Recommendation

That Council:

a note the resolution from the Audit, Risk & Improvement Committee meeting held on 23 November 2023 regarding the 2022/23 Financial Statements

b approve the signing of the 2022/23 Financial Statements pursuant to Section 413 (2)(c) of the Local Government Act 1993 and the Local Government Code of Accounting Practice and Financial Reporting

c approve the closing balances of the Internal Allocations (Reserves) as at 30 June 2023 as detailed in Note C1-3 – Restricted and allocated cash, cash equivalents and investments

d receive a report on the audited financial reports and auditors report at the 11 December 2023 Council Meeting, pursuant to Section 418(1) of the Local Government Act 1993 and provide public notice accordingly

Report

The 2022/23 Annual Financial Statements have been prepared and Council’s external auditors, NSW Audit Office, have commenced the final audit. It is a requirement of the Local Government Act 1993 that Council prepare a statement on the General Purpose and Special Purpose Financial Reports prior to sign off by the auditor. These statements must be signed by the Mayor, one Councillor, the General Manager and the Responsible Accounting Officer.

This statement is required to be signed and included in the Financial Statements prior to the auditor providing the final audit reports. The Financial Statements together with the auditors’ reports must be forwarded to the Office of Local Government (OLG) by 30 November 2023, with Council receiving a one-month extension from the OLG.

The 2022/23 financial statements were presented to the Audit, Risk & Improvement Committee (ARIC) at its meeting on 23 November 2023. Council’s Financial Statements are to be reviewed by the Committee prior to presentation and sign off by Council. In relation to this, the Committee’s role under the ARIC Charter notes that the Committee responsibilities include to:

· Satisfy itself that the annual financial reports comply with applicable Australian Accounting Standards and are supported by appropriate management signoff on the statements and the adequacy of internal controls

· Review the external audit opinion, including whether appropriate actions have been taken in response to audit recommendations and adjustments

· To consider contentious financial reporting matters in conjunction with Council’s management and external auditors

· Review the processes in place designed to ensure financial information included in the annual report is consistent with the signed financial statements

· Satisfy itself that there are appropriate mechanisms in place to review and implement, where appropriate, relevant State Government reports and recommendations

· Satisfy itself that there is a performance management framework linked to organisational objectives and recommendations

During the ARIC Meeting, the Committee resolved the following:

That the Audit, Risk and Improvement Committee:

a receive a presentation from Council’s auditors, the NSW Audit Office

b note that due to Council not having control over certain vested Rural Fire Service assets, and therefore not recording those Rural Fire Service assets in Council’s financial statements, the NSW Audit Office have expressed a Qualified Audit Opinion for the 2022/23 General Purpose Financial Statements

c recommend that Council approve the signing of the 2022/23 Financial Statements pursuant to Section 413(2)(c) of the Local Government Act 1993 and the Local Government Code of Accounting Practice and Financial Reporting

d recommend to Council to continue lobby the Federal Government to make settlement of the Airport land as the highest priority

The NSW Audit Office have advised Council that they will be expressing a Qualified Audit Opinion on Councils 2022/23 General Purpose Financial Statements (GPFS) due to a limitation on the scope of the audit. This is due to the continued non-recognition of rural fire-fighting equipment as assets in Councils financial statements. Council has continued to maintain that they have no control over these assets and will continue to not recognise these in our Statement of Financial Position.

2022/23 Financial Overview

The 2022/23 draft financial statements show total income from continuing operations of $189.2M, total expenses from continuing operations of $148.11M, resulting in a preliminary net operating surplus of $41.09M (including capital grants and contributions). The 2021/22 financial year resulted in a net operating surplus of $57.54M, with the decreased net result for 2022/23 being mainly attributable to a decrease in capital grants and contributions ($47.2M for 2022/23 compared to $70.4M for 2021/22).

Extract from the draft 2022/23 Financial Statements – Income Statement:

For the 2022/23 financial year, Council met the benchmark across all six (6) of the performance indicators outlined within the Financial Statements*. In 2021/22, Council met four (4) of the six (6) performance indicators, with Council not meeting the benchmark for Operating performance ratio (> 0%) and the Own source operating revenue ratio (>60.00%).

*For the 2022/23 financial year Council received more operating grants than the previous year (Operating performance ratio), and less capital grants than the previous year (Own source operating revenue ratio).

Below is an extract of the performance indicators from the draft 2022/23 financial statements.

Extract from the draft 2022/23 Financial Statements – Statement of performance measures:

As at 30 June 2023, Council held $66.3M in internal reserves, an increase of $12.2M on the previous year. The major internally restricted reserves Council holds are:

Reserve Name	30 June 2023 Balance	30 June 2022 Balance	Increase/ (Decrease) from prior year*

Civil Infrastructure	$8.750M	$9.317M	($0.567M)
Employees Leave Entitlement	$3.605M	$3.454M	$0.151M
Financial Assistance Grants in advance	$12.361M	$8.537M	$3.824M
Internal Loans	$6.216M	$3.650M	$2.566M
Livestock Marketing Centre	$6.582M	$6.032M	$0.550M
Project Carryovers	$6.990M	$3.098M	$3.892M

*Notes on Increases/(Decreases):

· Financial Assistance Grants in advance – $12.361M received in June 2023 for a 100% prepayment of the Financial Assistance Grant relating to the 2023/24 financial year. This has increased significantly from the previous year as Council only received a 75% prepayment of $8.537M in April 2023 relating to the 2022/23 financial year. These prepayments commenced in the 2016/17 financial year.

· Internal Loans Reserve – Funds were paid back to the Internal Loans Reserve for previously funded projects (Former Ambulance Station $654K, Bomen RIFL $427K, Pominglarna Multisport Cycling Complex $871K, Airport Covid deficits $187K), on top of the $1,439K in repayments from previously funded projects totalling $3,578K transfer to the Internal Loans Reserve. This amount was reduced by project funding of ($512K) and a transfer to Council’s bottom line of ($500K) to reduce the 2022/23 deficit as adopted in the Long Term Financial Plan, resulting in a total net movement to the reserve of $2,566K for 2022/23.

· Project Carryovers Reserve – This increase is as a result of more GPR funded projects being carried over from 2022/23 to 2023/24. These projects are predominantly made up of the recurrent roads programs funding carryovers of $3.8M.

A copy of the draft 2022/23 Financial Statements are attached to this report. As noted earlier, the Audit, Risk & Improvement Committee have reviewed the Draft Financial Statements and have provided their recommendation to Council in relation to signing the Statement by Councillors and Management within both the General-Purpose Financial Statements and Special Purpose Financial Statements.

Financial Implications

Whilst this report and associated attachments show Council’s financial performance and position for the 2022/23 financial year, the adoption of this report by the Committee has no financial implications.

Policy and Legislation

Local Government Act 1993

Sections: 413 - Preparation of Financial Reports

418 - Public notice to be given of presentation of financial reports

Link to Strategic Plan

Community leadership and collaboration

Objective: Wagga Wagga City Council leads through engaged civic governance and is recognised and distinguished by its ethical decision-making, efficient management, innovation and quality customer service

Ensure transparency and accountability

Risk Management Issues for Council

The NSW Audit Office has previously supplied Council with an interim management letter, which was discussed at the 17 August 2023 Audit, Risk & Improvement Committee Meeting. The interim management letter identified five (5) issues with one (1) rated as Moderate, and four (4) rated as Low. Council officers will undertake the actions identified in the Management Responses.

The Management letter on the Final Phase of the Audit for the year ended 30 June 2023 will be presented to the 22 February 2024 Audit, Risk & Improvement Committee meeting and will include Councils Management responses on any issues raised.

Internal / External Consultation

The Council’s Community Engagement Strategy and IAP2 considers the community to be “any individual or group of individuals, organisation or political entity with an interest in the outcome of a decision….”

Council’s external auditors, NSW Audit Office, have liaised with Council’s Finance division, along with presenting the draft financial statements to the Audit, Risk and Improvement Committee on 23 November 2023.

Mail

Traditional Media

Community Engagement

Digital

Rates notices insert

Direct mail

Letterbox drop

Council news

Media release

Media opportunity

TV/radio advertising

One-on-one meeting(s)

Community meeting(s)

Stakeholder workshop(s)

Drop-in session(s)

Survey/feedback form(s)

Have your Say

Email newsletter

Social media

Website

Inform

Consult

Involve

Collaborate

Other methods (please list specific details below)

N/A

Attachments

1 ⇩.	2022/23 Draft Annual Financial Statements
2 ⇩.	2022/23 Statement by Councillors and Management - General Purpose Financial Statements
3 ⇩.	2022/23 Statement by Councillors and Management - Special Purpose Financial Statements