Annual Report 2014/2015 - Shire of Cranbrook reports/2015... · Shire of Cranbrook 2014/2015 Annual...

Annual Report

2014/2015

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Shire of Cranbrook 2014/2015 Annual Report

Table of Contents

President’s Report i Chief Executive Officer’s Report iv Shire Profile x Your Council xi Council Staff xii Organisational Chart xiii Additional Information

- National Competition Policy xiv

- Local Law Review xiv

- Freedom of Information xiv

- Disability Access and Inclusion Plan xv

- Public Interest Disclosure xv

- Register of Complaints Made Against Councillors xv

- Record Keeping Plan xvi

- Register of Financial Interests for Elected Members and Senior Staff xvi

- Strategic Community Plan 2013 - 2023 xvii

- Strategic Community Plan 2014/2015 Achievement of Community Aspirations xix FINANCIAL REPORT Statement by Chief Executive Officer 2 2014/2015 Financial Report 3 - 56 Independent Audit Report 57 - 58

Shire of Cranbrook 2014/2015 Annual Report Page i

Shire President’s Report

SHIRE PRESIDENT’S REPORT It is with great pleasure that I present the Shire President’s Report for the 2014/2015 financial year. The financial climate in which the Shire operates continues to be constrained. The State Government’s mid-year budget review at the end of 2013, proposed to cut more than $70 million from funding for local roads under the State Road Funds to Local Government Agreement 2011/12-2015/16. The proposed cuts were $32.3 million in 2013/14, $18.8 million in 2014/15 and $19.3 million in 2015/16. When the State budget was handed down in May 2014, funding for local roads was slightly higher than originally anticipated for 2014/15, although funding for 2015/16 remained at the previously announced level of $177.4 million. The State budget also announced that the Country Local Government fund would be wound up in 2016/17, which will impact on all regional local government authorities in Western Australia. In addition, Royalties for Regions expenditure has been capped at $1 billion a year from 2014/15 to 2017/18. Despite these pressures, the Council maintained its focus of providing the community with new facilities and was able to either finalise or make significant progress towards a number of ongoing projects including the Stormwater Harvesting project in partnership with Cooperative Bulk Handling (CBH) and the Southern Link Voluntary Regional Organisation of Councils (VROC), and preliminary planning and consultation for the new Cranbrook Regional Community Hub. The waste water harvesting project gained momentum during the year with the construction of the 30ML dam on Shire land adjacent to the Great Southern Highway and the erection of a new water storage tank opposite the shire office. It was pleasing to receive the Management Orders for the vesting of dam number 2 (old railway dam) from the Water Corporation and the Department of Lands during the year. The Shire is grateful to both these agencies for their support in this matter. Since vesting was finalised in favour of the Shire, 800 metres of pressure main has been laid between the dam and the new water tank. Piping infrastructure has been connected to dam number 2 and the town’s water supply network. Completion of the water harvesting project will provide for non-potable water to be used for the Shire’s gardens, lawns and verges and allow capture of the enormous amount of water run-off from the CBH site that would otherwise feed into creek beds and drainage channels. Steady progress was also made during the year on the redevelopment of the new Cranbrook Regional Community Hub. Discussions with various stakeholders and community groups have occurred and a concept design brief has been awarded to an architectural practice in Albany. It is hoped that this project will gain further momentum during the course of the 2015/16 financial year now that Council has approved budget provision of $600,000, subject to grant funding of 50% through the National Stronger Regions Fund with the balance to be funded through the Cranbrook Community Hub and Rate Discount Reserve accounts. I am pleased to report that significant progress has been made on the new aged care development in Cranbrook. During the year, senior staff worked closely with the Executive of Darwinia Cottages Cranbrook Committee Inc (Darwinia) and the project architects, Howard and Heaver, on the site design and layout of the three new Independent Living Units. As a result, the floor plans and elevations have been finalised and consulting engineers engaged to complete the documentation phase. All

Shire of Cranbrook 2014/2015 Annual Report Page ii

preliminary site works have been completed including survey and new underground power requirements. During the year, Council also approved a concept plan and provided planning approval for the development of an additional nine Independent Living Units (ILUs) on lots 81, 82 and 83 Grenfell Street, Cranbrook. This approval provides for the creation of a structured and dedicated aged care precinct in town on land which is currently the site of the Cranbrook Community Centre. The staging of the planned additional aged accommodation will be subject to grant funding being secured in the future. It is anticipated that tenders for the aged care project, to be undertaken in partnership with the Shire of Kojonup and our other two VROC partners, will be called in September, 2015. Other major highlights for Council during the 2014/2015 financial year included:

• The completion of a new residence for the Manager of Works in Edward Street; • The commencement of the new clubrooms for the Tenterden Tennis Club at a cost of

$150,000; • The installation and commissioning of the new generator for emergency management

requirements at the back of the Shire Office; • The provision of continued funding to the Gillamii Centre to assist them in providing the

outstanding on ground works programs to our agricultural community; • The formation of a Steering Committee to progress the new regional motocross facility at

Sukey Hill. Several meetings have been held and grant funding obtained through the Great Southern Development Commission and the Department of Sport and Recreation to enable a feasibility study to be undertaken and a business case developed in support of infrastructure funding for the new site. The Shire has also been working closely with the Water Corporation and the Department of Lands to transfer vesting of a portion of Reserve 9520(proposed motocross site) to the Shire once all conditions on the management orders have been met, including the provision of new boundary fencing to the proposed site. This matter is progressing well.

The Council’s strong emphasis on road construction and maintenance continued in the 2014/2015 financial year, with over $2.3 million net being expended in this area. Specific details regarding the Shire’s Works expenditure can be found on page viii. I would like to thank the many community members on Council committees for volunteering their personal time to the Community throughout the year. Council recognises that without the tireless support of loyal volunteers, many of the initiatives and events that the Shire currently enjoys would not be possible. I would also like to thank our VROC partners for their support throughout the year. Our alliance with the Shires of Broomehill-Tambellup, Kojonup and Plantagenet provides a forum for meaningful discussion in support of a range of initiatives impacting on all four shires. We look forward to strengthening the VROC relationship in the future. The Council of the Shire of Cranbrook continues to work hard making decisions in the best interests of the community whilst striving to make the shire a better place to live, work and play. Council wants to see our towns expand, our businesses thrive and our infrastructure improve. We are continually putting significant effort into the provision of facilities that will meet the community’s needs and expectations, and at the same time, make these towns a more attractive place to live, visit and invest.

Shire of Cranbrook 2014/2015 Annual Report Page iii

The Council has a very dedicated team of employees that perform a range of duties that includes the Works staff, who build and maintain the roads, parks, gardens and buildings; Administration staff who manage the organisation and finances and provide the public face of the Council’s dealings with the community; and a committed team of support staff who look after the libraries, caravan parks and maintain and clean Council facilities. We also have a committed group of Councillors who strive to make responsible decisions and ensure that the Shire remains financially viable whilst pursing its vision. I thank all these people for working hard for the benefit of the Shire of Cranbrook. As I will not be seeking re-election to the Council in October 2015, I would like to express my sincere thanks to all Councillors and staff who have assisted me during my time on Council. Cr Jan Pope Shire President

Shire of Cranbrook 2014/2015 Annual Report Page iv

Chief Executive Officer’s Report

It gives me great pleasure to present the Chief Executive Officer’s Report for the 2014/2015 financial year. This report provides a summary of the Shire’s financial position, grant funding, rates information, road construction, plant replacement and a pictorial snapshot of many of the projects underway or completed by the Shire as at 30 June 2015.

Financial Performance The Shire of Cranbrook maintained its responsible financial position throughout 2014/2015, illustrated as follows:

• The Shire maintained appropriate reserve account funds for future major projects and asset replacement, including a closing balance at 30 June 2015 of $1,697,086 (refer pages 37-40). These cash backed funds are set aside for specific future purposes and are restricted on how they may be spent. The Council has made significant efforts to build up its reserve accounts to even out years of high and low expenditure requirements, such as when major items of plant are replaced, without the need to resort to borrowings or dramatic rate rises;

• No new loans were taken out during 2014/2015. The total principal for all loans outstanding at 30 June 2015 was $616,438 (refer page 46) and the total loan indebtedness represents 12.43% of 2014/2015 operating revenue.

• The equity on the Balance Sheet increased by $30.461m. The main factor behind this increase is the revaluation to fair value of all infrastructure assets as required by the Local Government (Financial Management) Regulations.

Grant Funding Road Construction: Main Roads WA and Roads to Recovery Grants totalled $1,152,304 and were, in the main, utilised for works on Cranbrook Frankland, Kojonup Frankland, Stockyard, Salt River, Yeriminup and Unicup Roads, Lomas Street Intersection and Bridge 274A.

Shire of Cranbrook 2014/2015 Annual Report Page v

Other Projects Other grants received during the year were for the supply and installation of an emergency generator for the Shire Administration Centre, the storm water harvesting project, construction of new clubrooms for the Tenterden Tennis Club, the upgrade to the Cranbrook War Memorial, publication of the ANZAC book, new bushfire equipment and a new heavy duty unit for the Cranbrook Town Bushfire Brigade.

New Clubrooms - Tenterden Tennis Club Emergency Generator

Storage Dam – Storm Water Harvest Project Anzac Council acquitted the 2012/2013 Country Local Government Fund Individual Allocation of grant funding. This funding assisted with the construction of new footpaths in Cranbrook and Frankland River, shade sails over the amphitheatre in Frankland River and the new playing surface for the hardcourts at Frederick Square.

Shire of Cranbrook 2014/2015 Annual Report Page vi

The following graph demonstrates the grant revenue received over the previous twenty financial years:

Borrowings No new loans were raised by the Council during 2014/2015. All loans are financed by general purpose income and the total principal outstanding as at the 30th June 2015 totalled $616,438.

$- $500,000

$1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000

$

Year

GRANT HISTORY

$- $100,000 $200,000 $300,000 $400,000 $500,000 $600,000 $700,000 $800,000

$

Year

LOAN LIABILITY HISTORY

Shire of Cranbrook 2014/2015 Annual Report Page vii

Rates In 2014/2015, the Council increased rates by 4.5% across all GRV and UV rated properties throughout the Shire. The minimum rate was $475 for all rate categories. Total rate revenue of $2,118m was raised in 2014/2015. Council resolved to continue with no discount for the early payment of rates and transferred $172,916 to the Rate Discount Reserve Account. A greater number of ratepayers opted for the instalment options available therefore rate collections throughout the year were slower than previous years. However, outstanding rates at the 30th June 2015 totalled $66,421 or 3.18% of 2014/2015 rates raised.

$- $500,000

$1,000,000 $1,500,000 $2,000,000 $2,500,000 $3,000,000 $3,500,000 $4,000,000 $4,500,000

Rates Grants Reserves Other

$

TOTAL REVENUE

03/0404/0505/0606/0707/0808/0909/1010/1111/1212/1313/1414/15

Shire of Cranbrook 2014/2015 Annual Report Page viii

Works and Services The Council continued to strongly pursue grant funding for preservation and improvement work of its road network. The total amount spent on road construction during 2014/2015 was as follows:

• Regional Road Group (RRG) $685,852 • Roads To Recovery (R2R) $183,135 • Council Funded $71,547 • Black Spot $12,069 • Commodity Route Funding $192,014 • Special Projects $340,000

Total $1,484,617 The construction work completed during the year was: Regional Road Group

• Cranbrook Frankland Road – Widen and Seal $224,902 • Kojonup Frankland Road – Widen and Seal $242,584 • Stockyard Road – Second Coat Seal $218,366

Roads to Recovery • Salt River Road – Gravel Resheet $57,173 • Yeriminup Road – Gravel Resheet $125,962

Council Funded • Boyup Brook Cranbrook Road – Gravel Resheet $29,351 • Chinninup Road – Gravel Resheet $25,876 • Archers Road – Gravel Resheet $16,320

Black Spot • Lomas Street – Install Signs and Line Marking $12,069

Commodity Route • Unicup Road – Gravel Resheet $192,014

Special Projects • Bridge 274A – Refurbishment $340,000

The total amount spent on road maintenance during 2014/2015 was $856,323. This included an extensive maintenance program throughout the Shire involving the following activities:

• Tree lopping and pruning; • Slashing; • Summer and winter grading; • Drain and road verge clearing; and • Verge spraying

Parks and Gardens The Parks and Gardens team take care of the Shire’s parks, reserves, playgrounds and gardens at Council buildings, cemeteries and the three townsites’ road verges. Routine maintenance includes:

• Slashing and spraying road verges; • Mowing, fertilizing, spraying and general grounds maintenance; • Gardening duties and playground maintenance; • Maintaining and installing new reticulation systems; and • Street tree watering.

Shire of Cranbrook 2014/2015 Annual Report Page ix

Plant Replacement Replacement of plant and equipment continued in accordance with the Council’s 10 year Plant Replacement Program. The capital items of plant purchased during the year included:

• Isuzu Giga Truck $196,451 • Komatsu Excavator & Mulching Head $212,129 • Skid Steer Trailer $7,455 • Mobile Fuel Tanker $14,004 • Flocon Emulsion Spray Air Vessel $11,780

I would personally like to thank each Councillor and Shire staff member for their effort and dedication in contributing to achieving the Council’s vision. I would also like to single out the members of the senior management team, Trish Standish, Cassandra Hughes, Jeff Alderton, Chloe Worth and Kellie Evans who provide excellent support, motivation, and most importantly, results for me as CEO to ensure the residents of the Shire receive a high level of service in a Shire they can be proud of. I encourage input from anyone who has an interest in the Shire of Cranbrook, so please do not hesitate to contact me if you have a comment, question or concern about anything in this Annual Report.

Peter Northover Chief Executive Officer Direct Phone - 9826 2209 Email – [email protected]

mailto:[email protected]

Shire of Cranbrook 2014/2015 Annual Report Page x

Shire Profile AREA 3392 km² DISTANCE FROM PERTH 325 km POPULATION 1,170 DWELLINGS 802 TOWNSITES Cranbrook, Frankland River and Tenterden LOCAL INDUSTRIES Sheep, Wool, Cattle, Pigs, Course Grains, Timber, Vineyards, Wine, Export Vegetables and Olives HISTORY The greater part of the Shire was settled between 1906 and 1914, the earliest settlers taking up the land grants about 1860. The Shire has developed into an area renowned for its quality wool. Grain and cattle are produced, and more recently Vineyards and Olives have been introduced into the Frankland area. UUCRANBROOK "Cranbrook - Gateway to the Stirlings". A portion of the Stirling Range National park is within the Shire of Cranbrook and besides the rugged beauty of the mountain range, the wildflowers of the Park are world famous. Many species are found nowhere else, such as the Cranbrook Bell (Darwinia Meeboldii). There are also many buildings and places of historical interest, Vineyards, freshwater and saltwater lakes and Sukey Hill Lookout. The Stirling Range National Park provides the tourist with the opportunity to experience an entire mountain range maintained in its natural state with animal, bird and plant life unspoiled by the encroachment of civilisation. It is one of the most outstanding botanic reserves in Australia, and is noted for its distinctive ruggedness and spectacular

wildflowers. An incredible variety of bush, composed almost entirely of flowering species ranging from small catspaws and orchids to tall blackboys and flowering gums, provides peaks and plains alike with a dense unbroken cover averaging 1 - 3 meters. The range has five peaks of over 1000m, including the highest, Bluff Knoll, 1073m. Whilst not high by world standard, their abruptness, isolation and jagged outline suggest a far greater size. UUFRANKLAND RIVER If you are thinking of a change of scenery on your next visit to or from the South Coast, then detour through the scenic Frankland River region and rejoin the Albany Highway at Mt Barker to the south or Kojonup in the north. The Frankland River area is one of WA’s best kept secrets of rolling hills, rich and productive farming land, natural forest and bush, abounding with unique native wildflowers. Whilst in Frankland River visit some of Australia’s award winning wineries that are renowned for their fresh and fruity whites and full bodied reds. UUTENTERDEN Tenterden is located on the Great Southern Railway, and although not one of the original sidings when the line was opened in 1889, a siding had been established here by 1891. Also in 1891 the government opened up agricultural land adjacent to the siding, by declaring the Tenterden Agricultural Area, and in 1893 part of this land was gazetted as the townsite of Tenterden.

Shire of Cranbrook 2014/2015 Annual Report Page xi

Your Council – as at 30 June 2015

Cr Jan Pope

Shire President Term of Office Expires 2015

Cr Twynam Cunningham Deputy Shire President

Term of Office Expires 2017

Cr Colin Egerton-Warburton Term of Office Expires 2015

Cr David Adams Term of Office Expires 2015

Cr Peter Beech

Term of Office Expires 2015

Cr Winston Griffiths Term of Office Expires 2017

Cr Thomas Standish Term of Office Expires 2017

Cr Peter Denton Term of Office Expires 2017

Cr Ruth Bigwood Term of Office Expires 2017

Shire of Cranbrook 2014/2015 Annual Report Page xii

Council Staff - as at 30 June 2015

UOFFICE CONTACT DETAILS Shire of Cranbrook 19 Gathorne Street (PO Box 21) Cranbrook WA 6321

U

CHIEF EXECUTIVE OFFICER Mr Peter Northover MANAGER OF FINANCE AND ADMINISTRATION Mrs Trish Standish MANAGER OF WORKS Mr Jeff Alderton MANAGER OF ECONOMIC AND COMMUNITY DEVELOPMENT Ms Cassandra Hughes EMERGENCY SERVICES & RECREATION OFFICER Ms Toni Melia PERSONAL ASSISTANT TO THE CEO Miss Kellie Evans FINANCE OFFICER Mrs Jessica Standish FINANCE ASSISTANT Mrs Lauren Lehmann CUSTOMER SERVICE OFFICER Mrs Karen Alderton COMMUNITY & EXECUTIVE SUPPORT OFFICER Mrs Vanessa Fiegert WORKS SUPERVISOR Mr Dean Parsons LEADING HAND CONSTRUCTION Mr Wayne Toovey LEADING HAND MAINTENANCE Mr Joe Duina TEAM LEADER PARKS AND GARDENS Mr Damond Briggs WORKS STAFF Mr Corey Stoneham Mr Ray Manders Mr David Parsons Mr Allan Singleton Mr Martin Taylor Mr Steven Scott Mr Stephen Berry Ms Tracey Hearn Mr Chris Macniven Mr Craig Critch Mr Mitchell Toovey RANGER Mr Joe Duina CLEANER Mrs Ev Harvey CARAVAN PARK CARETAKERS Ms Melinda Stevens

Mr Steven Palin and Mrs Susan Palin – Cranbrook

STAFF WHO RESIGNED DURING 2014/2015 Ms Heather Bell Mr Craige Anning Ms Marie Granquist Mr Glenn Sayers Mr BobbyJo Duina Mr Ron Rivett Mrs Diana Burl The Local Government Act requires the Annual Report to detail the number of employees who are entitled to an annual salary of $100,000 or more and to break those employees down into bands of $10,000. During 2014/2015 the Shire of Cranbrook had:

• one employee whose annual salary falls between $100,000 and $109,999; and • one employee whose annual salary falls between $130,000 and $139,999.

Shire of Cranbrook 2014/2015 Annual Report Page xiii

Organisational Chart

Shire of Cranbrook 2014/2015 Annual Report Page xiv

National Competition Policy This policy has been introduced by the Commonwealth Government so as to promote competition for the benefit of business, consumers and the economy by removing unnecessary protection of monopolies of markets where competition can be enhanced. It effects local governments as factors such as exemption from company and income tax or possible local regulations and laws may give local government a potential advantage over private contractors. In respect to competitive neutrality, the Shire of Cranbrook reports: The Shire of Cranbrook during 2014/2015 did not engage in any significant business activities

which generated in excess of $200,000 annual income. Therefore, the introduction of competitive neutrality under Clause 7 of the policy was not required.

There is no indication that the Council will become involved in any significant business

activities during the next financial reporting period. There have been no allegations received by the Council of non-compliance with the neutrality

principles.

Local Law Reviews Existing Local Laws of the Shire of Cranbrook were reviewed in May 2003, in accordance with the Local Government Act 1995. The Local Laws relating to Health were adopted by Council in August 1998. In April 2002 the following local laws were gazetted:

Activities on Thoroughfares and Trading in Thoroughfares and Public Places Local Law; Local Government Property Local Law; Standing Orders Local Law 2001; Repeal Local Law 2001; Noxious Weed and Pest Plants Repeal Local Law; Bush Fire Brigades Local Law; Dogs Local Law; and Cemeteries Local Law 2001

National Competition Policy requires all local governments to review their local laws, both new and existing, to ensure the legislation does not prevent competition. Council's Local Laws are available for inspection at the Shire Administration Centre during normal office hours. Freedom of Information The Shire of Cranbrook welcomes any enquiries for information held by Council. The Shire is subject to the provisions of the Freedom of Information Act 1992, which gives individuals and organisations a general right of access to information held by the Shire. The Act also provides the right of appeal in relation to decisions made by the Shire to refuse access to information applied for under the Act. The Shire received no requests for information in 2014/2015.

Shire of Cranbrook 2014/2015 Annual Report Page xv

Disability Services Plan It is the requirement under section 29(2) of the Disability Services Act 1993 to report on the following outcomes in Council's approach to assisting disabled people. 1. Existing services are adapted to ensure they meet the needs of people with disabilities. Council continued in 2014/2015 to ensure opportunities were created for people with disabilities, their families and carers. Council was receptive to any feedback received and acted immediately on any complaints to ensure people with disabilities could live within our community without unnecessary obstacles. 2. Access to buildings and facilities is improved. The Shire of Cranbrook is mindful of disabled access and considerations are made during the planning process of all Council amenities to improve access for people with disabilities. 3. Information about services is provided in formats which meet the communication requirements of people with disabilities. With the community of the Shire of Cranbrook having a comparatively small population, it was possible to advise the few people affected with disabilities in our community by other communication channels. (e.g verbal or by the Home and Community Care Program). Council is mindful of the need to keep outgoing information in a variety of formats for access by all its constituents. 4. Advice and services are delivered by staff who are aware of and understand the needs of people with disabilities. Staff at the Shire of Cranbrook are capable to resource information when the need arises. 5. Opportunities are provided for people with disabilities to participate in public consultations, grievance mechanisms and decision making processes. Disabled access to the Shire Administration Building, the Frankland River Community Centre and the Cranbrook Community Centre (HACC) have improved the opportunities for people with disabilities to take part in public consultations and grievance mechanisms via Council Meetings, Elections and HACC Carers. Public Interest Disclosure In accordance with the requirements of the Public Interest Disclosure Act 2003, the Shire of Cranbrook has established procedures to facilitate the making of disclosures under the Act. These procedures set out the processes in place in respect to protected disclosures generally, to protect people from reprisal for making protected disclosures, and to provide guidance on investigations. During the 2014/2015 financial year, no disclosures relating to improper conduct were made to the Shire and therefore no disclosures were referred to the ombudsman. Register of Complaints Made Against Councillors In accordance with section 5.53 of the Local Government Act and the associated Local Government (Rules of Conduct) Regulations 2007 the complaints made against Councillors during the 2014/2015 financial year were nil.

Shire of Cranbrook 2014/2015 Annual Report Page xvi

Record Keeping Plan In accordance with legislative requirements, a Record Keeping Plan for the Shire of Cranbrook was completed and lodged with the State Records Office. This is a requirement under the State Records Act 2000, an Act to provide for the keeping of State records and for related purposes. The Record Keeping Plan is prepared to ensure compliance with Section 19 of the State Records Act 2000. Best practice record keeping is conducted in accordance with State Records Commission Standards and Records Management Standard AS15489. The Shire of Cranbrook Record Keeping Plan has set out the minimum requirements as to which records are to be created and how those records are kept. The Shire of Cranbrook has developed processes to facilitate the complete and accurate record of all business transactions and decisions. Measures have been taken to ensure all recorded information can be retrieved quickly, accurately and cheaply when required and government records are protected and preserved. These take the form of hard copies or electronic records. The Record Keeping Officer has attended training in records management covering Records Keeping Basics, Keyword Classification and Records Disposal. A general briefing for all staff on the compliance requirements of the State Records Act 2000 and induction training for all new staff on their obligations was completed in accordance with the State Records Act 2000 and the operation of records management within the Shire of Cranbrook.

Register of Financial Interests for Elected Members and Senior Staff In accordance with the requirements of the Local Government Act (1995), this register is held in the Administration office and is available for viewing by the public.

Shire of Cranbrook 2014/2015 Annual Report Page xvii

Strategic Community Plan 2013 - 2023 Councils Vision That the Shire of Cranbrook is a proactive sustainable, safe, friendly and prosperous place to be Councils Mission

• To create the Shire of Cranbrook as a place of choice for its: • Community participation and respect • Prosperous economy with sustainable employment opportunities • Outstanding infrastructure and services • Well managed, resilient environment • Positive and proactive Council

Aspirations for the Future By 2023 the Shire of Cranbrook will …

• Be respected for its friendly, vibrant, connected and safe communities • Have an innovative, diverse, prosperous and growing economy • Maintain, protect, enhance and promote its environment • Have enviable, quality infrastructure, roads and facilities • Demonstrate strong governance, leadership and organisational growth

Priority Areas and Responsibilities As part of the Integrated Planning Framework, the Shire undertook a series of 12 community engagement sessions to develop a new 10 year Strategic Community Plan. As part of the engagement process Shire Staff met with representatives from a range of groups in the community. These focus groups resulted in an engagement of more than 15% of the Shire’s population. Following on from the focus group workshops, a survey was made available to the entire community. From this a draft plan was prepared and distributed to the community and then 2 community consultation workshops were held to incorporate final changes and suggestions into the plan. The Council adopted the full suite of Integrated Planning and Reporting Documents on 26 June 2013, these included:

• Strategic Community Plan 2013-2023 • Corporate Business Plan 2013-2017 • Community Engagement Strategy 2013-2017 • Long Term Financial Plan 2013-2028 • Workforce Plan 2013-2017 • Risk Management Strategy 2013-2015 • Asset Management Plan 2013 • Asset Management Improvement Strategy 2013

These documents are available from the Shire Administration Centre in Cranbrook.

Shire of Cranbrook 2014/2015 Annual Report Page xviii

Integrated Planning Framework

Shire of Cranbrook 2014/2015 Annual Report Page xix

Strategic Community Plan 2014/2015 Achievement of Community Aspirations

Highlights • Anzac commemoration dinner and book • Remembrance day ceremony • Youth Advisory Council formed • Continuation of association with Act

Belong Commit • Continuing of support for Roadwise • New 0-4 Smart Start coordinator

appointed • Reinstatement of outreach medical clinic

to Frankland River commenced • Continuing progress of Motocross

development • Tenterden Tennis Clubroom development • BFAC succession planning underway

Objectives not met Drug and alcohol program deferred to 2015/2016

Highlights • Tourism Support – Hidden Treasures Bloom

Festival and promotion of CMCA Rally • National Broadband Network towers installed

in two locations within the Shire • • New Local Planning Strategy

Objectives not met There has been no activity in carbon market opportunities due to reduction in carbon activity Training and development programs for industry have not yet been delivered No further action on the exploration of possible alternative sources for power and water supplies to town sites

Highlights • Ongoing support and development of

Gillamii • Storm water harvesting project complete Objectives not met Understanding and maximising the carbon market has been suspended due to Federal Government policy changes.

Highlights

• Aged Independent Living Units project progressing well

• Completion of the roads program • Footpath upgrades • Plant replacement program successfully

implemented within budget

Objectives not met Sukey Hill lookout to be replaced when funding is available

Community

Achieved

Not Achieved

Economy

Achieved

Not Achieved

Environment

Achieved

Not Achieved

Infrastructure

Achieved

Not Achieved

Shire of Cranbrook 2014/2015 Annual Report Page xx

Highlights • Successful implementation of the Strategic

Community Plan and Corporate Business Plan

• Continuation of ACE meetings • Facebook page has been very successful • Continued to improve safety and risk

management practices • Successful regional Councillor training

undertaken • Risk management report adopted by

Council

Objectives not met Signage policy to be developed in 2015/2016 Long Term Financial Plan review deferred to 2015/2016.

Organisation

Achieved

Not Achieved

86%

60% 64%

56%

63%

Overall Aspirational Targets Achieved

FINANCIAL REPORT

FOR THE YEAR ENDED 30TH JUNE 2015

TABLE OF CONTENTS

Statement by Chief Executive Officer 2

Statement of Comprehensive Income by Nature or Type 3

Statement of Comprehensive Income by Program 4

Statement of Financial Position 5

Statement of Changes in Equity 6

Statement of Cash Flows 7

Rate Setting Statement 8

Notes to and Forming Part of the Financial Report 9

Independent Audit Report 57

Supplementary Ratio Information 59

Principal place of business:19 Gathorne StreetCranbrook WA 6321

SHIRE OF CRANBROOK

SHIRE OF CRANBROOKSTATEMENT OF COMPREHENSIVE INCOME

BY NATURE OR TYPEFOR THE YEAR ENDED 30TH JUNE 2015

NOTE 2015 2015 2014$ Budget $

$RevenueRates 23 2,118,507 2,121,643 2,054,198Operating grants, subsidies and contributions 29 2,420,644 1,653,616 2,267,024Fees and charges 28 340,299 324,340 318,602Interest earnings 2(a) 70,868 71,977 77,531Other revenue 5,475 4,050 15,186

4,955,793 4,175,626 4,732,541

ExpensesEmployee costs (1,257,906) (1,091,214) (959,271)Materials and contracts (1,440,702) (1,583,631) (2,360,232)Utility charges (138,354) (131,560) (128,457)Depreciation on non-current assets 2(a) (1,673,342) (1,565,080) (1,551,463)Interest expenses 2(a) (35,771) (37,485) (31,708)Insurance expenses (108,259) (130,456) (127,267)Other expenditure (73,539) (71,501) (63,868)

(4,727,873) (4,610,927) (5,222,266)227,920 (435,301) (489,725)

Non-operating grants, subsidies and contributions 29 1,738,980 2,735,614 1,688,132Profit on asset disposals 21 41,784 43,000 2,952Loss on asset disposals 21 (34,539) (5,000) (137,792)

Net result 1,974,145 2,338,313 1,063,567

Other comprehensive incomeChanges on revaluation of non-current assets 13 28,489,858 0 4,087,746Changes on revaluation of non-current assets 13 (2,787) 0 (5,337)

Total other comprehensive income 28,487,071 0 4,082,409

Total comprehensive income 30,461,216 2,338,313 5,145,976

This statement is to be read in conjunction with the accompanying notes.

SHIRE OF CRANBROOKSTATEMENT OF COMPREHENSIVE INCOME

BY PROGRAMFOR THE YEAR ENDED 30TH JUNE 2015

NOTE 2015 2015 2014$ Budget $

$Revenue 2(a) Governance 24,453 8,130 26,020General purpose funding 4,136,016 3,486,584 2,729,809Law, order, public safety 63,045 42,925 64,275Health 3,973 1,100 1,163Education and welfare 7,485 500 1,905Housing 67,824 66,660 74,990Community amenities 82,621 87,076 84,541Recreation and culture 44,028 42,450 23,527Transport 183,830 240,931 1,504,745Economic services 194,611 179,570 160,351Other property and services 147,906 21,700 61,215

4,955,791 4,177,626 4,732,541

Expenses 2(a) Governance (382,139) (394,300) (337,001)General purpose funding (117,189) (118,927) (135,771)Law, order, public safety (264,852) (241,833) (232,159)Health (62,665) (52,923) (51,073)Education and welfare (45,953) (42,623) (25,815)Housing (75,658) (84,437) (78,441)Community amenities (518,913) (493,773) (366,858)Recreation and culture (693,341) (711,626) (645,552)Transport (2,042,132) (1,987,669) (3,036,829)Economic services (391,440) (410,370) (345,107)Other property and services (97,818) (36,961) 64,048

(4,692,100) (4,575,442) (5,190,558)

Finance costs 2(a) Housing (25,112) (25,479) (19,394)Recreation and culture (10,659) (12,006) (12,314)

(35,771) (37,485) (31,708)

Non-operating grants, subsidies and contributionsLaw, order, public safety 360,705 10,000 284,036Community amenities 176,002 950,350 314,119Recreation and culture 49,969 541,960 4,174Transport 1,152,304 1,233,304 1,001,658Economic services 0 0 84,145

29 1,738,980 2,735,614 1,688,132

Profit/(Loss) on disposal of assetsGovernance (13,142) (3,000) (10,040)Housing 38,839 0 (10,500)Transport (18,452) 0 0Other property and services 0 41,000 (114,300)

21 7,245 38,000 (134,840)

Net result 1,974,145 2,338,313 1,063,567

Other comprehensive income

Changes on revaluation of non-current assets 13 28,489,858 0 4,087,746Changes on revaluation of non-current assets 13 (2,787) 0 (5,337)

Total other comprehensive income 28,487,071 0 4,082,409

Total comprehensive income 30,461,216 2,338,313 5,145,976


SHIRE OF CRANBROOKSTATEMENT OF FINANCIAL POSITION

AS AT 30TH JUNE 2015

NOTE 2015 2014$ $

CURRENT ASSETSCash and cash equivalents 3 2,953,346 1,665,163Trade and other receivables 5 131,238 145,687Inventories 6 31,710 36,866TOTAL CURRENT ASSETS 3,116,294 1,847,716

NON-CURRENT ASSETSOther receivables 5 32,591 43,300Investments 4 55,879 58,666Property, plant and equipment 7 17,642,041 17,594,707Infrastructure 8 119,673,099 90,484,591TOTAL NON-CURRENT ASSETS 137,403,611 108,181,265

TOTAL ASSETS 140,519,905 110,028,981

CURRENT LIABILITIESTrade and other payables 9 153,119 104,427Current portion of long term borrowings 10 79,630 75,424Provisions 11 254,978 187,428TOTAL CURRENT LIABILITIES 487,727 367,279

NON-CURRENT LIABILITIESLong term borrowings 10 536,809 616,439Provisions 11 47,815 58,926TOTAL NON-CURRENT LIABILITIES 584,624 675,364

TOTAL LIABILITIES 1,072,351 1,042,643

NET ASSETS 139,447,554 108,986,338

EQUITYRetained surplus 71,723,394 70,085,310Reserves - cash/investment backed 12 1,697,086 1,187,560Revaluation surplus 13 66,027,074 37,713,468TOTAL EQUITY 139,447,554 108,986,338


SHIRE OF CRANBROOKSTATEMENT OF CHANGES IN EQUITY


RESERVESRETAINED CASH/INVESTMENT REVALUATION TOTAL

NOTE SURPLUS BACKED SURPLUS EQUITY$ $ $ $

Balance as at 1 July 2013 69,125,491 1,083,812 33,625,721 103,835,024

Comprehensive income Net result 1,063,567 0 0 1,063,567 Changes on revaluation of non-current assets 13 0 0 4,087,746 4,087,746Total comprehensive income 1,063,567 0 4,087,746 5,151,313

Transfers from/(to) reserves (103,748) 103,748 0 0

Balance as at 30 June 2014 70,085,310 1,187,560 37,713,468 108,986,338

Comprehensive income Net result 1,974,145 0 0 1,974,145 Changes on revaluation of non-current assets 13 0 0 28,489,858 28,489,858 Changes on revaluation of non-current assets 13 0 0 (2,787) (2,787)Total comprehensive income 1,974,145 0 28,487,071 30,461,216

Transfers from/(to) reserves (509,526) 509,526 0 (0)

Transfer from/(to) Asset Revaluation Reserve on asset sales 173,465 0 (173,465) 0

Balance as at 30 June 2015 71,723,394 1,697,086 66,027,074 139,447,554


SHIRE OF CRANBROOKSTATEMENT OF CASH FLOWS


NOTE 2015 2015 2014$ Budget $

CASH FLOWS FROM OPERATING ACTIVITIES $ReceiptsRates 2,168,278 2,157,343 2,050,963Operating grants, subsidies and

contributions 2,420,644 1,653,616 2,541,836Fees and charges 317,931 329,355 318,602Interest earnings 70,868 71,977 77,531Goods and services tax 0 0 (13,187)Other revenue 5,475 4,050 15,186

4,983,197 4,216,341 4,990,931PaymentsEmployee costs (1,193,212) (1,078,642) (908,781)Materials and contracts (1,394,741) (1,546,119) (2,388,020)Utility charges (138,354) (131,560) (128,457)Interest expenses (36,139) (130,456) (27,646)Insurance expenses (108,259) (37,485) (127,267)Goods and services tax (9,946) 0 0Other expenditure (73,539) (71,501) (63,868)

(2,954,190) (2,995,763) (3,644,039)Net cash provided by (used in) operating activities 14(b) 2,029,007 1,220,578 1,346,892

CASH FLOWS FROM INVESTING ACTIVITIESPayments for purchase of property, plant & equipment (1,579,308) (3,003,673) (2,218,308)Payments for construction of infrastructure (1,669,059) (1,818,600) (1,710,931)Advances to community groups 0 (1,000) 0Non-operating grants, Subsidies and contributions 1,738,980 2,735,614 1,688,132Proceeds from sale of fixed assets 836,283 617,000 468,942Net cash provided by (used in) investment activities (673,104) (1,470,659) (1,772,165)

CASH FLOWS FROM FINANCING ACTIVITIESRepayment of debentures (75,425) (75,425) (73,841)Proceeds from self supporting loans 7,700 7,700 8,600Proceeds from new debentures 0 0 300,000Net cash provided by (used In) financing activities (67,725) (67,725) 234,759

Net increase (decrease) in cash held 1,288,182 (317,806) (190,514)Cash at beginning of year 1,665,163 1,665,163 1,855,676Cash and cash equivalents at the end of the year 14(a) 2,953,346 1,347,357 1,665,163


SHIRE OF CRANBROOKRATE SETTING STATEMENT


2015 2015 2014NOTE Actual Budget Actual

$ $ $RevenueGovernance 24,453 8,130 28,972General purpose funding 2,017,509 1,364,941 675,611Law, order, public safety 423,750 52,925 348,311Health 3,973 1,100 1,163Education and welfare 7,485 500 1,905Housing 264,717 66,660 74,990Community amenities 258,623 1,037,426 398,660Recreation and culture 93,997 584,410 27,701Transport 1,346,267 1,474,235 2,506,403Economic services 194,611 179,570 244,496Other property and services 147,906 62,700 61,215

4,783,291 4,832,597 4,369,427ExpensesGovernance (398,311) (397,300) (349,993)General purpose funding (117,189) (118,927) (135,771)Law, order, public safety (264,852) (241,833) (232,159)Health (62,665) (52,923) (51,073)Education and welfare (45,953) (42,623) (25,815)Housing (100,770) (109,916) (108,335)Community amenities (518,913) (493,773) (366,858)Recreation and culture (704,000) (723,632) (657,866)Transport (2,052,275) (1,987,669) (3,036,829)Economic services (391,440) (410,370) (345,107)Other property and services (97,818) (36,961) (50,252)

(4,754,187) (4,615,927) (5,360,058)

Net result excluding rates 29,104 216,670 (990,631)

Adjustments for cash budget requirements:Non-cash expenditure and revenue(Profit)/Loss on asset disposals 21 (7,245) (38,000) 134,840Fair value adjustment on asset sales 13 (173,465) 0 0Movement in deferred pensioner rates (non-current) 3,608 0 428Movement in employee benefit provisions (non-current) (11,111) 0 5,214Movement in employee benefit provisions (current) 67,550 0 49,177Movement in accrued salaries and wages 6,118 0 5,999Depreciation and amortisation on assets 2(a) 1,673,342 1,565,080 1,551,463Capital Expenditure and RevenuePurchase of land and buildings 7(b) (240,446) (1,885,177) (999,515)Purchase furniture and equipment 0 0 (27,165)Purchase plant and equipment 7(b) (1,338,862) (1,118,496) (1,191,628)Purchase roads 8(b) (1,137,748) (1,818,600) (1,710,931)Purchase other infrastructure 8(b) (171,546) 0 0Purchase footpaths 8(b) (12,897) 0 0Purchase drainage 8(b) (6,868) 0 0Purchase bridges 8(b) (340,000) 0 0Advances to community groups 0 (1,000) 0Proceeds from disposal of fixed assets 21 836,283 617,000 468,942Repayment of debentures 22(a) (75,425) (75,425) (73,841)Proceeds from new debentures 22(a) 0 0 300,000Proceeds from self supporting loans 7,700 7,700 8,600Transfers to reserves (restricted assets) 12 (578,680) (260,777) (373,135)Transfers from reserves (restricted assets) 12 69,154 300,980 269,387

ADD Estimated surplus/(deficit) July 1 b/fwd 23(b) 565,691 368,402 1,084,289LESS Estimated surplus/(deficit) June 30 c/fwd 23(b) 1,282,768 0 565,691

Total amount raised from general rate 23(a) (2,118,507) (2,121,643) (2,054,198)


1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) Basis of PreparationThe financial report comprises general purpose financial statements which have been prepared in accordance with Australian Accounting Standards (as they apply to local governments and not-for-profit entities), Australian Accounting Interpretations, other authoritative pronouncements of the AustralianAccounting Standards Board, the Local Government Act 1995 and accompanying regulations. Material accounting policies which have been adopted in the preparation of this financial report are presentedbelow and have been consistently applied unless stated otherwise.

Except for cash flow and rate setting information, the report has been prepared on the accrual basis and is based on historical costs, modified, where applicable, by the measurement at fair value of selected non-current assets, financial assets and liabilities.

Critical accounting estimatesThe preparation of a financial report in conformity with Australian Accounting Standards requires management to make judgements, estimates and assumptions that effect the application of policies and reported amounts of assets and liabilities, income and expenses.

The estimates and associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the circumstances; the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

The local government reporting entityAll Funds through which the Shire controls resources to carry on its functions have been included in thefinancial statements forming part of this financial report.

In the process of reporting on the local government as a single unit, all transactions and balances between those Funds (for example, loans and transfers between Funds) have been eliminated.

All monies held in the Trust Fund are excluded from the financial statements. A separate statement ofthose monies appear at Note 20 to these financial statements.

(b) Goods and Services Tax (GST)Revenues, expenses and assets are recognised net of the amount of GST, except where the amount of GST incurred is not recoverable from the Australian Taxation Office (ATO).

Receivables and payables are stated inclusive of GST receivable or payable.The net amount of GST recoverable from, or payable to, the ATO is included with receivables or payables in the statement of financial position.

Cash flows are presented on a gross basis. The GST components of cash flows arising from investing or financing activities which are recoverable from, or payable to, the ATO are presented as operatingcash flows.

(c) Cash and Cash EquivalentsCash and cash equivalents include cash on hand, cash at bank, deposits available on demand with banks and other short term highly liquid investments that are readily convertible to known amounts of cash and which are subject to an insignificant risk of changes in value and bank overdrafts.

Bank overdrafts are reported as short term borrowings in current liabilities in the statement of financial position.

SHIRE OF CRANBROOKNOTES TO AND FORMING PART OF THE FINANCIAL REPORT


1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued)

(d) Trade and Other ReceivablesTrade and other receivables include amounts due from ratepayers for unpaid rates and service charges and other amounts due from third parties for goods sold and services performed in the ordinary course of business.

Receivables expected to be collected within 12 months of the end of the reporting period are classified as current assets. All other receivables are classified as non-current assets.

Collectability of trade and other receivables is reviewed on an ongoing basis. Debts that are known to be uncollectible are written off when identified. An allowance for doubtful debts is raised when there is objective evidence that they will not be collectible.

(e) Inventories

GeneralInventories are measured at the lower of cost and net realisable value.

Net realisable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.

Land held for saleLand held for development and sale is valued at the lower of cost and net realisable value. Cost includes the cost of acquisition, development, borrowing costs and holding costs until completion of development.Finance costs and holding charges incurred after development is completed are expensed.

Gains and losses are recognised in profit or loss at the time of signing an unconditional contract of sale if significant risks and rewards, and effective control over the land, are passed on to the buyer at this point.

Land held for sale is classified as current except where it is held as non-current based on the Council’sintentions to release for sale.

(f) Fixed AssetsEach class of fixed assets within either property, plant and equipment or infrastructure, is carried at cost or fair value as indicated less, where applicable, any accumulated depreciation and impairment losses.

Mandatory requirement to revalue non-current assetsEffective from 1 July 2012, the Local Government (Financial Management) Regulations were amended and the measurement of non-current assets at Fair Value became mandatory.

The amendments allow for a phasing in of fair value in relation to fixed assets over three years as follows:

(a) for the financial year ending on 30 June 2013, the fair value of all of the assets of the local government that are plant and equipment; and(b) for the financial year ending on 30 June 2014, the fair value of all of the assets of the local government - (i) that are plant and equipment; and (ii) that are - (I) land and buildings; or- (II) Infrastructure;and(c) for a financial year ending on or after 30 June 2015, the fair value of all of the assets of the local government.

Thereafter, in accordance with the regulations, each asset class must be revalued at least every 3 years.

In 2013, the Shire commenced the process of adopting Fair Value in accordance with the Regulations.

Relevant disclosures, in accordance with the requirements of Australian Accounting Standards, have been made in the financial report as necessary.




(f) Fixed Assets (Continued)

Land under controlIn accordance with Local Government (Financial Management) Regulation 16(a), the Shire was requiredto include as an asset (by 30 June 2013), Crown Land operated by the local government as a golf course,showground, racecourse or other sporting or recreational facility of State or Regional significance.

Upon initial recognition, these assets were recorded at cost in accordance with AASB 116. They were then classified as Land and revalued along with other land in accordance with the other policies detailed in this Note.

Initial recognition and measurement between mandatory revaluation datesAll assets are initially recognised at cost and subsequently revalued in accordance with the mandatory measurement framework detailed above.

In relation to this initial measurement, cost is determined as the fair value of the assets given as consideration plus costs incidental to the acquisition. For assets acquired at no cost or for nominal consideration, cost is determined as fair value at the date of acquisition. The cost of non-current assetsconstructed by the Shire includes the cost of all materials used in construction, direct labour on the projectand an appropriate proportion of variable and fixed overheads.

Individual assets acquired between initial recognition and the next revaluation of the asset class in accordance with the mandatory measurement framework detailed above, are carried at cost lessaccumulated depreciation as management believes this approximates fair value. They will be subject tosubsequent revaluation at the next anniversary date in accordance with the mandatory measurement framework detailed above.

RevaluationIncreases in the carrying amount arising on revaluation of assets are credited to a revaluation surplus in equity. Decreases that offset previous increases of the same asset are recognised against revaluation surplus directly in equity. All other decreases are recognised in profit or loss.

Land under roadsIn Western Australia, all land under roads is Crown Land, the responsibility for managing which, is vested in the local government.

Effective as at 1 July 2008, Council elected not to recognise any value for land under roads acquired on or before 30 June 2008. This accords with the treatment available in Australian Accounting Standard AASB 1051 Land Under Roads and the fact Local Government (Financial Management) Regulation 16(a)(i) prohibits local governments from recognising such land as an asset.

In respect of land under roads acquired on or after 1 July 2008, as detailed above, Local Government (Financial Management) Regulation 16(a)(i) prohibits local governments from recognising such landas an asset.

Whilst such treatment is inconsistent with the requirements of AASB 1051, Local Government (Financial Management) Regulation 4(2) provides, in the event of such an inconsistency, the Local Government (Financial Management) Regulations prevail.

Consequently, any land under roads acquired on or after 1 July 2008 is not included as an asset of the Shire.




(f) Fixed Assets (Continued)

DepreciationThe depreciable amount of all fixed assets including buildings but excluding freehold land, are depreciated on a straight-line basis over the individual asset’s useful life from the time the asset is held ready for use. Leasehold improvements are depreciated over the shorter of either the unexpired period of the lease or the estimated useful life of the improvements.

When an item of property, plant and equipment is revalued, any accumulated depreciation at the date of the revaluation is treated in one of the following ways:a) Restated proportionately with the change in the gross carrying amount of the asset so that the carrying amount of the asset after revaluation equals its revalued amount; orb) Eliminated against the gross carrying amount of the asset and the net amount restated to the revalued amount of the asset.

Major depreciation periods used for each class of depreciable asset are:

Buildings 30 to 60 yearsFurniture and equipment 3 to 15 yearsPlant and equipment 1 to 15 yearsSealed roads and streets formation not depreciated pavement 45 to 55 years seal - bituminous seals 20 to 25 years - asphalt surfaces 25 to 30 yearsGravel roads formation not depreciated pavement 20 to 40 yearsFormed roads (unsealed) formation not depreciated pavement 20 to 40 yearsFootpaths - slab 25 to 45 years

The assets residual values and useful lives are reviewed, and adjusted if appropriate, at the end of each reporting period.

An asset's carrying amount is written down immediately to its recoverable amount if the asset's carryingamount is greater than its estimated recoverable amount.

Gains and losses on disposals are determined by comparing proceeds with the carrying amount. These gains and losses are included in the statement of comprehensive income in the period in whichthey arise.

Capitalisation thresholdExpenditure on items of equipment under $2,000 is not capitalised.




(g) Fair Value of Assets and LiabilitiesWhen performing a revaluation, the Shire uses a mix of both independent and management valuationsusing the following as a guide:

Fair Value is the price that the Shire would receive to sell the asset or would have to pay to transfer aliability, in an orderly (i.e. unforced) transaction between independent, knowledgeable and willing market participants at the measurement date.

As fair value is a market-based measure, the closest equivalent observable market pricing information is used to determine fair value. Adjustments to market values may be made having regard to the characteristics of the specific asset or liability. The fair values of assets that are not traded in an active market are determined using one or more valuation techniques. These valuation techniques maximise, to the extent possible, the use of observable market data.

To the extent possible, market information is extracted from either the principal market for the asset orliability (i.e. the market with the greatest volume and level of activity for the asset or liability) or, in the absence of such a market, the most advantageous market available to the entity at the end of thereporting period (i.e. the market that maximises the receipts from the sale of the asset after taking into account transaction costs and transport costs).

For non-financial assets, the fair value measurement also takes into account a market participant’s ability to use the asset in its highest and best use or to sell it to another market participant that would use the asset in its highest and best use.

Fair value hierarchyAASB 13 requires the disclosure of fair value information by level of the fair value hierarchy, which categorises fair value measurement into one of three possible levels based on the lowest level that an input that is significant to the measurement can be categorised into as follows:

Level 1Measurements based on quoted prices (unadjusted) in active markets for identical assets or liabilities that the entity can access at the measurement date.

Level 2Measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3Measurements based on unobservable inputs for the asset or liability.

The fair values of assets and liabilities that are not traded in an active market are determined using one or more valuation techniques. These valuation techniques maximise, to the extent possible, the use of observable market data. If all significant inputs required to measure fair value are observable, the asset or liability is included in Level 2. If one or more significant inputs are not based on observable market data, the asset or liability is included in Level 3.

Valuation techniquesThe Shire selects a valuation technique that is appropriate in the circumstances and for which sufficientdata is available to measure fair value. The availability of sufficient and relevant data primarily depends on the specific characteristics of the asset or liability being measured. The valuation techniques selected bythe Shire are consistent with one or more of the following valuation approaches:

Market approachValuation techniques that use prices and other relevant information generated by market transactions for identical or similar assets or liabilities.

NOTES TO AND FORMING PART OF THE FINANCIAL REPORTFOR THE YEAR ENDED 30TH JUNE 2015

SHIRE OF CRANBROOK


(g) Fair Value of Assets and Liabilities (Continued)

Income approachValuation techniques that convert estimated future cash flows or income and expenses into a single discounted present value.

Cost approachValuation techniques that reflect the current replacement cost of an asset at its current service capacity.

Each valuation technique requires inputs that reflect the assumptions that buyers and sellers would use when pricing the asset or liability, including assumptions about risks. When selecting a valuation technique, the Shire gives priority to those techniques that maximise the use of observable inputs and minimise the use of unobservable inputs. Inputs that are developed using market data (such as publicly available information on actual transactions) and reflect the assumptions that buyers and sellers wouldgenerally use when pricing the asset or liability are considered observable, whereas inputs for which market data is not available and therefore are developed using the best information available about such assumptions are considered unobservable.

As detailed above, the mandatory measurement framework imposed by the Local Government (Financial Management) Regulations requires, as a minimum, all assets carried at a revalued amount to be revalued at least every 3 years.

(h) Financial Instruments

Initial recognition and measurementFinancial assets and financial liabilities are recognised when the Shire becomes a party to thecontractual provisions to the instrument. For financial assets, this is equivalent to the date that the Shire commits itself to either the purchase or sale of the asset (i.e. trade date accounting isadopted).

Financial instruments are initially measured at fair value plus transaction costs, except where the instrument is classified 'at fair value through profit or loss', in which case transaction costs are expensed to profit or loss immediately.

Classification and subsequent measurementFinancial instruments are subsequently measured at fair value, amortised cost using the effective interest rate method, or at cost.

Amortised cost is calculated as:

(a) the amount in which the financial asset or financial liability is measured at initial recognition;

(b) less principal repayments and any reduction for impairment; and

(c) plus or minus the cumulative amortisation of the difference, if any, between the amountinitially recognised and the maturity amount calculated using the effective interest rate method.

The effective interest method is used to allocate interest income or interest expense over the relevant period and is equivalent to the rate that discounts estimated future cash payments or receipts (including fees, transaction costs and other premiums or discounts) through the expected life (or when this cannot be reliably predicted, the contractual term) of the financial instrument to the net carrying amount of the financial asset or financial liability. Revisions to expected future net cash flows will necessitate an adjustment to the carrying value with a consequential recognition of an income or expense in profit or loss.




(h) Financial Instruments (Continued)

Classification and subsequent measurement (continued)

(i) Financial assets at fair value through profit and loss Financial assets are classified at “fair value through profit or loss” when they are held for trading for the purpose of short-term profit taking. Such assets are subsequently measured at fair value with changes in carrying amount being included in profit or loss. Assets in this category are classified as current assets.

(ii) Loans and receivables Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market and are subsequently measured at amortised cost. Gains or losses are recognised in profit or loss.

Loans and receivables are included in current assets where they are expected to mature within 12 months after the end of the reporting period.

(iii) Held-to-maturity investments Held-to-maturity investments are non-derivative financial assets with fixed maturities and fixed or determinable payments that the Shire has the positive intention and ability to hold to maturity. Theyare subsequently measured at amortised cost. Gains or losses are recognised in profit or loss.

Held-to-maturity investments are included in non-current assets, where they are expected to mature within 12 months after the end of the reporting period. All other investments are classified as non-current.

(iv) Available-for-sale financial assets Available-for-sale financial assets are non-derivative financial assets that are either not suitable to be classified into other categories of financial assets due to their nature, or they are designated as such by management. They comprise investments in the equity of other entities where there is neither a fixed maturity nor fixed or determinable payments.

They are subsequently measured at fair value with changes in such fair value (i.e. gains or losses) recognised in other comprehensive income (except for impairment losses). When the financial asset is derecognised, the cumulative gain or loss pertaining to that asset previously recognised in other comprehensive income is reclassified into profit or loss.

Available-for-sale financial assets are included in current assets, where they are expected to be sold within 12 months after the end of the reporting period. All other available-for-sale financial assets are classified as non-current.

(v) Financial liabilitiesNon-derivative financial liabilities (excluding financial guarantees) are subsequently measured at amortised cost. Gains or losses are recognised in profit or loss.




(h) Financial Instruments (Continued)

ImpairmentA financial asset is deemed to be impaired if, and only if, there is objective evidence of impairment asa result of one or more events (a “loss event”) having occurred, which will have an impact on the estimated future cash flows of the financial asset(s).

In the case of available-for-sale financial assets, a significant or prolonged decline in the market value of the instrument is considered a loss event. Impairment losses are recognised in profit or loss immediately. Also, any cumulative decline in fair value previously recognised in other comprehensive income is reclassified to profit or loss at this point.

In the case of financial assets carried at amortised cost, loss events may include: indications that the debtors or a group of debtors are experiencing significant financial difficulty, default or delinquency in interest or principal payments; indications that they will enter bankruptcy or other financial reorganisation; and changes in arrears or economic conditions that correlate with defaults.

For financial assets carried at amortised cost (including loans and receivables), a separate allowance account is used to reduce the carrying amount of financial assets impaired by credit losses. After having taken all possible measures of recovery, if management establishes that the carrying amount cannot be recovered by any means, at that point the written-off amounts are charged to the allowance account or the carrying amount of impaired financial assets is reduced directly if no impairment amount was previously recognised in the allowance account.

DerecognitionFinancial assets are derecognised where the contractual rights to receipt of cash flows expire or theasset is transferred to another party whereby the Shire no longer has any significant continualinvolvement in the risks and benefits associated with the asset.

Financial liabilities are derecognised where the related obligations are discharged, cancelled or expired. The difference between the carrying amount of the financial liability extinguished or transferred to another party and the fair value of the consideration paid, including the transfer of non-cash assets or liabilities assumed, is recognised in profit or loss.

(i) Impairment of AssetsIn accordance with Australian Accounting Standards the Shire's assets, other than inventories,are assessed at each reporting date to determine whether there is any indication they may be impaired.

Where such an indication exists, an impairment test is carried out on the asset by comparing the recoverable amount of the asset, being the higher of the asset's fair value less costs to sell and value in use, to the asset's carrying amount.

Any excess of the asset's carrying amount over its recoverable amount is recognised immediately in profit or loss, unless the asset is carried at a revalued amount in accordance with another Standard (e.g. AASB 116) whereby any impairment loss of a revalued asset is treated as a revaluation decrease in accordance with that other Standard.

For non-cash generating assets such as roads, drains, public buildings and the like, value in use isrepresented by the depreciated replacement cost of the asset.

(j) Trade and Other PayablesTrade and other payables represent liabilities for goods and services provided to the Shire prior to theend of the financial year that are unpaid and arise when the Shire becomes obliged to make futurepayments in respect of the purchase of these goods and services. The amounts are unsecured, are recognised as a current liability and are normally paid within 30 days of recognition.




(k) Employee BenefitsShort-term employee benefits Provision is made for the Shire’s obligations for short-term employee benefits. Short-term employeebenefits are benefits (other than termination benefits) that are expected to be settled wholly before 12 months after the end of the annual reporting period in which the employees render the related service, including wages, salaries and sick leave. Short-term employee benefits are measured at the (undiscounted) amounts expected to be paid when the obligation is settled.

The Shire’s obligations for short-term employee benefits such as wages, salaries and sick leave arerecognised as a part of current trade and other payables in the statement of financial position. The Shire’s obligations for employees’ annual leave and long service leave entitlements are recognised asprovisions in the statement of financial position.

Other long-term employee benefitsProvision is made for employees’ long service leave and annual leave entitlements not expected to be settled wholly within 12 months after the end of the annual reporting period in which the employees render the related service. Other long-term employee benefits are measured at the present value of the expected future payments to be made to employees. Expected future payments incorporate anticipated future wage and salary levels, durations of service and employee departures and are discounted at rates determined by reference to market yields at the end of the reporting period on government bonds that have maturity dates that approximate the terms of the obligations. Any remeasurements for changes in assumptions of obligations for other long-term employee benefits are recognised in profit or loss in the periods in which the changes occur.

The Shire’s obligations for long-term employee benefits are presented as non-current provisions in its statement of financial position, except where the Shire does not have an unconditional right to defer settlement for at least 12 months after the end of the reporting period, in which case the obligations are presented as current provisions.

(l) Borrowing CostsBorrowing costs are recognised as an expense when incurred except where they are directly attributable to the acquisition, construction or production of a qualifying asset. Where this is the case, they are capitalised as part of the cost of the particular asset until such time as the asset is substantially ready for its intended use or sale.

(m) ProvisionsProvisions are recognised when the Shire has a present legal or constructive obligation, as a result of past events, for which it is probable that an outflow of economic benefits will result and that outflow can be reliably measured.

Provisions are measured using the best estimate of the amounts required to settle the obligation at the end of the reporting period.

(n) LeasesLeases of fixed assets where substantially all the risks and benefits incidental to the ownership of the asset, but not legal ownership, are transferred to the Shire, are classified as finance leases.

Finance leases are capitalised recording an asset and a liability at the lower amounts equal to the fair value of the leased property or the present value of the minimum lease payments, including anyguaranteed residual values. Lease payments are allocated between the reduction of the lease liabilityand the lease interest expense for the period.

Leased assets are depreciated on a straight line basis over the shorter of their estimated useful lives or the lease term.

Lease payments for operating leases, where substantially all the risks and benefits remain with thelessor, are charged as expenses in the periods in which they are incurred.

Lease incentives under operating leases are recognised as a liability and amortised on a straight linebasis over the life of the lease term.




(o) Investment in AssociatesAn associate is an entity over which the Shire has significant influence. Significant influence is the power to participate in the financial operating policy decisions of that entity but is not control or joint control of those policies. Investments in associates are accounted for in the financial statements by applying the equity method of accounting, whereby the investment is initially recognised at cost and adjusted thereafter for the post-acquisition change in the Shire’s share of net assets of the associate.In addition, the Shire’s share of the profit or loss of the associate is included in the Shire’s profit or loss.

The carrying amount of the investment includes, where applicable, goodwill relating to the associate. Any discount on acquisition, whereby the Shire’s share of the net fair value of the associate exceedsthe cost of investment, is recognised in profit or loss in the period in which the investment is acquired.

Profits and losses resulting from transactions between the Shire and the associate are eliminated tothe extent of the Shire’s interest in the associate.

When the Shire’s share of losses in an associate equals or exceeds its interest in the associate, theShire discontinues recognising its share of further losses unless it has incurred legal or constructiveobligations or made payments on behalf of the associate. When the associate subsequently makes profits, the Shire will resume recognising its share of those profits once its share of the profits equalsthe share of the losses not recognised.

(p) Interests in Joint ArrangementsJoint arrangements represent the contractual sharing of control between parties in a business venture where unanimous decisions about relevant activities are required.

Separate joint venture entities providing joint venturers with an interest to net assets are classified as a joint venture and accounted for using the equity method. Refer to note 1(o) for a description of the equity method of accounting.

Joint venture operations represent arrangements whereby joint operators maintain direct interests in each asset and exposure to each liability of the arrangement. The Shire’s interests in the assets,liabilities, revenue and expenses of joint operations are included in the respective line items of the financial statements. Information about the joint ventures is set out in Note 17.

(q) Rates, Grants, Donations and Other ContributionsRates, grants, donations and other contributions are recognised as revenues when the local government obtains control over the assets comprising the contributions.

Control over assets acquired from rates is obtained at the commencement of the rating period or, where earlier, upon receipt of the rates.

Where contributions recognised as revenues 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 nature of and amounts pertaining to those undischarged conditions are disclosed in Note 2(c) . That note also discloses the amount of contributions recognisedas revenues in a previous reporting period which were obtained in respect of the local government's operations for the current reporting period.

(r) SuperannuationThe Shire contributes to a number of Superannuation Funds on behalf of employees. All funds towhich the Shire contributes are defined contribution plans.




(s) Current and Non-Current ClassificationIn the determination of whether an asset or liability is current or non-current, consideration is given to the time when each asset or liability is expected to be settled. The asset or liability is classified as current if it is expected to be settled within the next 12 months, being the Shire’s operational cycle. In the caseof liabilities where the Shire does not have the unconditional right to defer settlement beyond 12 months,such as vested long service leave, the liability is classified as current even if not expected to be settled within the next 12 months. Inventories held for trading are classified as current even if not expected to be realised in the next 12 months except for land held for sale where it is held as non-current based on the Shire’s intentions to release for sale.

(t) Rounding Off FiguresAll figures shown in this annual financial report, other than a rate in the dollar, are rounded to the nearest dollar.

(u) Comparative FiguresWhere required, comparative figures have been adjusted to conform with changes in presentation for the current financial year.

When the Shire applies an accounting policy retrospectively, makes a retrospective restatement or reclassifies items in its financial statement, an additional (third) statement of financial position as at thebeginning of the preceding period in addition to the minimum comparative financial statements ispresented.

(v) Budget Comparative FiguresUnless otherwise stated, the budget comparative figures shown in this annual financial report relate to the original budget estimate for the relevant item of disclosure.

NOTES TO AND FORMING PART OF THE FINANCIAL REPORTFOR THE YEAR ENDED 30TH JUNE 2015

SHIRE OF CRANBROOK



1. SIGNIFICANT ACCOUNTING POLICIES (Continued)

(w) New Accounting Standards and Interpretations for Application in Future Periods

Management's assessment of the new and amended pronouncements that are relevant to the Shire, applicable to future reporting periods and which have not yetbeen adopted are set out as follows:

Title Issued / Compiled Applicable (1) Impact

(i) AASB 9 Financial Instruments December 2014 1 January 2018 Nil – The objective of this Standard is to improve and simplify the (incorporating AASB 2014-7 and approach for classification and measurement of financial assetsAASB 2014-8) compared with the requirements of AASB 139. Given the nature of

the financial assets of the Shire, it is not anticipated the Standard will have any material effect.

(ii) AASB 2010-7 Amendments September 2012 1 January 2018 Nil - The revisions embodied in this Standard give effect to the to Australian Accounting consequential changes arising from the issuance of AASB 9 which is Standards arising from AASB 9 not anticipated to have any material effect on the Shire (refer (i)(December 2010) above).

[AASB 1, 3, 4, 5, 7, 101, 102, 108, 112, 118, 120, 121, 127, 128, 131, 132, 136, 137, 139, 1023 & 1038 and Interpretations 2, 5, 10, 12, 19 & 127]

(iii) AASB 15 Revenue from Contracts with December 2014 1 January 2017 This Standard establishes principles for entities to apply to reportCustomers useful information to users of financial statements about the nature,

amount, timing and uncertainty of revenue and cash flows arisingfrom a contract with a customer.

The effect of this Standard will depend upon the nature of futuretransactions the Shire has with those third parties it has dealingswith. It may or may not be significant.

The AASB has issued a number of new and amended Accounting Standards and Interpretations that have mandatory application dates for future reporting periods,some of which are relevant to the Shire.


FOR THE YEAR ENDED 30TH JUNE 20151. SIGNIFICANT ACCOUNTING POLICIES (Continued)

(w) New Accounting Standards and Interpretations for Application in Future Periods (Continued)


(iv) AASB 2013-9 Amendments to Australian December 2013 Refer title column Part C of this Standard makes consequential amendments toAccounting Standards - Conceptual AASB 9 and numerous other Standards and amends the Framework, Materiality and Financial permissions around certain applications relating to financial Instruments liabilities reissued at fair value.

[Operative date: Part C Financial As the bulk of changes relate either to editorial or reference changesInstruments - 1 January 2015] it is not expected to have a significant impact on the Shire.

(v) AASB 2014-3 Amendments to Australian August 2014 1 January 2016 This Standard amends AASB 11: Joint Arrangements to require theAccounting Standards - Accounting for acquirer of an interest (both initial and additional) in a joint operationAcquisitions of Interests in Joint Operations in which the activity constitutes a business, as defined in AASB 3:

Business Combinations, to apply all of the principles on business[AASB 1 & AASB 11] combinations accounting in AASB 3 and other Australian

Accounting Standards except for those principles that conflict withthe guidance in AASB 11; and disclose the information requiredby AASB 3 and other Australian Accounting Standards for businesscombinations.

Since adoption of this Standard would impact only acquisitions ofinterests in joint operations on or after 1 January 2016,management believes it is impracticable at this stage to provide areasonable estimate of such impact on the Shire's financialstatements.

(vi) AASB 2014-4 Amendments to Australian August 2014 1 January 2016 This Standard amends AASB 116 and AASB 138 to establish theAccounting Standards - Clarification of principle for the basis of depreciation and amortisation as being theAcceptable Methods of Depreciation and expected pattern of consumption of the future economic benefits ofAmortisation an asset. It also clarifies the use of revenue-based methods to

calculate the depreciation of an asset is not appropriate nor is[AASB 116 & 138] revenue generally an appropriate basis for measuring the

consumption of the economic benefits embodied in an intangibleasset.

Given the Shire curently uses the expected pattern of consumption of

the future economic benefits of an asset as the basis of calculationof depreciation, it is not expected to have a significant impact.






(vii) AASB 2014-5 Amendments to Australian December 2014 1 January 2017 Consequential changes to various Standards arising from the Accounting Standards arising from AASB 15 issuance of AASB 15.

It will require changes to reflect the impact of AASB 15.

(viii) AASB 2015-2 Amendments to Australian January 2015 1 January 2016 This Standard amends AASB 101 to provide clarification regardingAccounting Standards – Disclosure the disclosure requirements in AASB 101. Specifically, theInitiative: Amendments to Standard proposes narrow-focus amendments to address some of AASB 101 the concerns expressed about existing presentation and disclosure

requirements and to ensure entities are able to use judgement[AASB 7, 101, 134 & 1049] when applying a Standard in determining what information to

disclose in their financial statements.

This Standard also makes editorial and consequential amendmentsas a result of amendments to the Standards listed in the titlecolumn.

It is not anticipated it will have any significant impact ondisclosures.

(ix) AASB 2015-3 Amendments to Australian January 2015 1 July 2015 This Standard completes the withdrawal of references to AASB 1031Accounting Standards arising from the in all Australian Accounting Standards and Interpretations, allowingwithdrawal of AASB 1031 Materiality it to be completely withdrawn.

It is not anticipated it will have a significant impact as the principlesof materiality remain largely unchanged.






(x) AASB 2015-6 Amendments to Australian March 2015 1 July 2016 The objective of this Standard is to extend the scope of AASB 124Accounting Standards - Extending Related Related Party Disclosures to include not-for-profit sector entities.Party Disclosures to Not-for-Profit PublicSector Entities The Standard is expected to have a significant disclosure impact on

the financial report of the Shire as both Elected Members and Senior[AASB 10, 124 & 1049] Management will be deemed to be Key Management Personnel

and resultant disclosures will be necessary.

Notes:(1) Applicable to reporting periods commencing on or after the given date.

(x) Adoption of New and Revised Accounting Standards

AASB 2011-7AASB 2012-3AASB 2013-3AASB 2013-8AASB 2013-9 Parts A & B

criteria of IFRSs or related to topics not relevant to operations.

and which were applicable to its operations.

or reporting practices or were either not applicable, largely editorial in nature, were revisions to help ensure consistency with presentation, recognition and measurement

During the current year, the Shire adopted all of the new and revised Australian Accounting Standards and Interpretations which were compiled, became mandatory

These new and revised Standards were:

Most of the Standards adopted had a minimal effect on the accounting and reporting practices of the Shire as they did not have a significant impact on the accounting



2. REVENUE AND EXPENSES 2015 2014$ $

(a) Net Result

The Net result includes:

(i) Charging as an expense:

Auditors remuneration- Audit of the annual financial report 10,000 14,875- Other services 8,400 5,200

DepreciationNon-specialised buildings 47,473 52,698Specialised buildings 194,376 158,505Furniture and Equipment 40,644 31,555Plant and Equipment 417,640 368,367Freehold land 2,800 0Roads 939,334 919,749Other Infrastructure 16,336 20,590Footpaths 7,731 0Drainage 2,484 0Bridges 4,523 0

1,673,342 1,551,463Interest expenses (finance costs)Debentures (refer Note 22 (a)) 35,771 31,708

35,771 31,708Rental charges- Operating leases 6,610 8,376

6,610 8,376(ii) Crediting as revenue:

Other revenueOther 5,475 15,186

5,475 15,186

2015 2015 2014Actual Budget Actual

$ $ $Interest earnings- Reserve funds 32,712 35,827 40,091- Other funds 17,500 13,500 13,860Other interest revenue (refer note 27) 20,656 22,650 23,581

70,868 71,977 77,531



2. REVENUE AND EXPENSES (Continued)

(b) Statement of Objective

through the various service oriented programs which it has established.

COMMUNITY VISION

place to be.

GOVERNANCEObjective:

Activities:

GENERAL PURPOSE FUNDINGObjective:

Activities:

LAW, ORDER, PUBLIC SAFETYObjective:

Activities:

HEALTHObjective:

Activities:

EDUCATION AND WELFAREObjective:

Activities:

HOUSINGObjective:To provide and maintain staff and rental housing. Activities:

Administration and operation of facilities and services to members of Council; other costs

Provision and maintenance of staff and rental housing.

relate to the task of assisting elected members and ratepayers on matters which do not concern specific council services.

Food quality control, provide and maintain the Cranbrook and Frankland River doctors

and other aspects of public safety including emergency services.

To collect revenue to allow for the provision of services.

To provide services to disadvantaged persons, the elderly, children and youth

Provide financial assistance for community lunches, facilites to playgroups and other

surgeries.

community groups.

The Shire of Cranbrook is dedicated to providing high quality services to the community

That the Shire of Cranbrook is a proactive, sustainable, safe, friendly and prosperous

Rates, general purpose government grants and interest revenue.

To provide services to help ensure a safer and environmentally conscious community.

Supervision and enforcement of various local laws relating to fire prevention, animal control

To provide an operational framework for environmental and community health.

service orientated activities/programs.Operations as disclosed in these financial statements encompass the following

To provide a decision making process for the efficient allocation of resources.




(b) Statement of Objective (Continued)

COMMUNITY AMENITIESObjective:

Activities:

RECREATION AND CULTUREObjective:

Activities:

TRANSPORTObjective:

Activities:

ECONOMIC SERVICESObjective:

Activities:

OTHER PROPERTY AND SERVICESObjective:

Activities:

well being of the community.

co-ordination of cemeteries and storm water drainage maintenance. The administration of

Cleaning and lighting of streets, traffic signage and depot maintenance.

the town planning scheme, community services and environmental services.

Private works operations, plant repair and operation costs and allocation of overheads.

To provide services required by the community.

Rubbish collection services, operation of rubbish disposal sites, control and

To establish and effectively manage infrastructure and resource which will help the social

To help promote the shire and its economic wellbeing.

The regulation and provision of tourism, area promotion, building control, noxious weeds,

To monitor and control Shire of Cranbrook's overheads operating accounts.

Maintenance of public halls, sporting complex, various reserves, art and craft centre, Lake

To provide safe, effective and efficient transport services to the community

Poorrarecup and Nunijup and operation of the Cranbrook and Frankland River libararies.

and the operation of the Cranbrook and Frankland River Caravan Parks.

Construction and maintenance of roads, streets, footpaths, parking facilities.




(c) Conditions Over Grants/Contributions Opening Closing ClosingBalance (1) Received (2) Expended (3) Balance (1) Received (2) Expended (3) Balance

Function/ 1/07/13 2013/14 2013/14 30/06/14 2014/15 2014/15 30/06/15Grant/Contribution Activity $ $ $ $ $ $ $

AGWA Grant - Town Bore Community Amenities 12,542 0 9,556 2,986 0 2,986 0

RRG - Kojonup Frankland Rd Transport 3,621 0 3,621 0 0 0 0CLGF Grant GPF 442,490 0 434,777 7,713 0 7,713 0CBH Grant - Stormwater Harvesting

Community Amenities 0 0 0 0 25,000 20,544 4,456

CSRFF Grant - Tenterden Tennis Club

Recreation & Culture 0 0 0 0 49,969 38,821 11,148

R2R - Salt River Road Transport 0 0 0 0 314,884 183,135 131,749

Bloom Festival Grant Economic Services 0 0 0 0 27,273 1,750 25,523

SCNRN Grant - Feral Animal Control

Law Order & Public Safety 0 0 0 0 3,579 2,456 1,123

Total 458,653 0 447,954 10,699 420,705 257,405 173,999

Notes:

(1) - Grants/contributions recognised as revenue in a previous reporting period which were not expended at the close of the previous reporting period.

(2) - New grants/contributions which were recognised as revenues during the reporting period and which had not yet been fully expended in the manner specified by the contributor.

(3) - Grants/contributions which had been recognised as revenues in a previous reporting period or received in the current reporting period and which were expended in the current reporting period in the manner specified by the contributor.



Note 2015 2014$ $

3. CASH AND CASH EQUIVALENTS

Unrestricted 1,082,261 352,718Restricted 1,871,085 1,312,445

2,953,346 1,665,163The following restrictions have been imposed byregulations or other externally imposed requirements:

Leave reserve 12 30,319 29,547Plant Replacement Reserve 12 248,756 212,580Building Asset Management Reserve 12 134,729 134,210Community Associations Financial Assistance Reserv 12 34,707 29,804Office and Sundry Equipment Reserve 12 16,898 16,467Waste Management Reserve 12 87,471 85,244Acquisition and Development of Land Reserve 12 35,036 25,048Frankland River Sporting Facilities Reserve 12 279,156 268,519Housing Reserve 12 370,867 121,574Cranbrook St John Sub-Centre Reserve 12 112,072 109,219Community Bus Reserve 12 12,411 9,244Asset Replacement Fund - Frankland River Bowling G 12 37,682 29,860Asset Replacement Fund - Cranbrook Bowling Green 12 37,682 29,860Rate Discount Reserve 12 259,300 86,384Unspent grants 2(c) 173,999 10,699Unspent loans 22(c) 0 114,186

1,871,085 1,312,445

4. INVESTMENTS

Available-for-Sale Financial Assets 55,879 58,666

At the beginning of the year 58,666 64,002Revaluation to income statement (2,787) (5,336)Additions 0 0Disposals 0 0At the end of the year 55,879 58,666

- Share in Great Southern Community Financial Services Ltd 5,000 5,000 - Units in Local Government House Trust 50,879 53,666

55,879 58,666



2015 2014$ $

5. TRADE AND OTHER RECEIVABLES

CurrentRates outstanding 62,230 108,393Sundry debtors 38,775 16,407GST receivable 23,133 13,187Loans - clubs/institutions 7,100 7,700

131,238 145,687Non-currentRates outstanding - pensioners 4,191 7,800Loans - clubs/institutions 28,400 35,500

32,591 43,300

6. INVENTORIES

CurrentFuel and materials 31,710 36,866

31,710 36,866



2015 2014$ $

7 (a). PROPERTY, PLANT AND EQUIPMENT

Land and buildingsFreehold land at: - Independent valuation 2014 - level 2 1,504,249 1,504,249 - Additions after valuation - cost 22,201 0 - Disposals after valuation (80,000) 0Less: accumulated depreciation (2,800) 0

1,443,650 1,504,249

Land vested in and under the control of Council at: - Independent valuation 2014 - level 3 145,000 145,000

145,000 145,000

1,588,650 1,649,249

Non-specialised buildings at: - Independent valuation 2014 - level 3 2,412,814 2,412,814 - Additions after valuation - cost 154,816 0 - Disposals after valuation (175,000) 0Less: accumulated depreciation (44,756) 0

2,347,874 2,412,814

Specialised buildings at: - Independent valuation 2014 - level 3 9,721,983 9,721,983 - Additions after valuation - cost 63,430 0Less: accumulated depreciation (194,376) 0

9,591,037 9,721,983

11,938,911 12,134,797

Total land and buildings 13,527,561 13,784,046

Furniture and Equipment at: - Management valuation 2013 - level 3 375,318 375,318 - Additions after valuation - cost 25,265 25,265 - Disposals after valuation (5,278) 0Less accumulated depreciation (67,711) (31,395)

327,594 369,188

Plant and Equipment at: - Management valuation 2013 - level 2 3,209,756 3,209,756 - Additions after valuation - cost 1,268,185 575,021Less accumulated depreciation (691,055) (343,304)

3,786,886 3,441,473

17,642,041 17,594,707

The fair value of property, plant and equipment is determined at least every three years in accordancewith legislative requirements. Additions since the date of valuation are shown as cost, given they were acquired at arms length and any accumulated depreciation reflects the usage of service potential, it is considered the recorded written down value approximates fair value. At the end of eachintervening period the valuation is reviewed and where appropriate the fair value is updated toreflect current market conditions. This process is considered to be in accordance with Local Government (Financial Management) Regulation 17A (2) which requires property, plant and equipment to be shown at fair value.



7. PROPERTY, PLANT AND EQUIPMENT (Continued)

(b) Movements in Carrying Amounts

Movement in the carrying amounts of each class of property, plant and equipment between the beginning and the end of the current financial year.

Balance Carryingat the Revaluation Impairment Amount

Beginning Increments/ (Losses)/ Depreciation at theof the Year Additions (Disposals) (Decrements) Reversals (Expense) Transfers End of Year

$ $ $ $ $ $ $ $

Freehold land 1,504,249 22,201 (80,000) 0 0 (2,800) 0 1,443,650

145,000 0 0 0 0 0 0 145,000Total land 1,649,249 22,201 (80,000) 0 0 (2,800) 0 1,588,650

Non-specialised buildings 2,412,814 154,816 (172,282) 0 0 (47,473) 0 2,347,874

Specialised buildings 9,721,983 63,430 0 0 0 (194,376) 0 9,591,037Total buildings 12,134,797 218,246 (172,282) 0 0 (241,850) 0 11,938,911

Total land and buildings 13,784,046 240,446 (252,282) 0 0 (244,650) 0 13,527,561

Furniture and Equipment 369,188 0 (950) 0 0 (40,644) 0 327,594

Plant and Equipment 3,441,473 1,338,862 (575,809) 0 0 (417,640) 0 3,786,886

Total property, plant and equipment 17,594,707 1,579,308 (829,041) 0 0 (702,934) 0 17,642,041

Land vested in and under the control of Council

7. PROPERTY, PLANT AND EQUIPMENT (Continued)(c) Fair Value Measurements

Fair Value Hierarchy Valuation Technique Basis of

valuationDate of last Valuation Inputs used

Land and buildings

2

Market approach using recent observable market data for similar properties/income approach using discounted cashflow methodology

Independent Registered

ValuersJune 2014 Price per hectare/market borrowing rate

3Improvements to land valued using cost approach using depreciated

replacement cost


ValuersJune 2014

Improvements to land using construction costs and current condition (Level 2), residual values and

remaining useful life assessments (Level 3) inputs

2

Market approach using recent observable market data for similar properties/income approach using discounted cashflow methodology


ValuersJune 2014

Improvements to land using construction costs and current condition (Level 2), residual values and

remaining useful life assessments (Level 3) inputs

3Improvements to land valued using cost approach using depreciated

replacement cost


ValuersJune 2014 Price per square metre/market borrowing rate

3 Cost approach using depreciated replacement cost

Management Valuation June 2013 Price per item

3 Cost approach using depreciated replacement cost

Management Valuation June 2013 Price per item

Level 3 inputs are based on assumptions with regards to future values and patterns of consumption utilising current information. If the basis of these assumptions were varied , they have the potential to result in a significantly higher or lower fair value measurement.

During the period there were no changes in the valuation techniques used by the local government to determine the fair value of property, plant and equipment using either level 2 or level 3 inputs.



Asset Class

Furniture and Equipment

Plant and Equipment

Freehold land

Land vested in and under the control of Council

Non-specialised buildings

Specialised buildings



2015 2014$ $

8 (a). INFRASTRUCTURE

Roads - Management valuation 2007 0 114,334,587 - Management valuation 2015 - level 3 86,187,304 0 - Cost 0 9,085,144Less accumulated depreciation 0 (34,547,573)

86,187,304 88,872,158

Other Infrastructure - Independent valuation 2015 - level 3 970,746 0 - Cost 0 1,330,070Less accumulated depreciation 0 (366,293)

970,746 963,777

Footpaths - Management valuation 2015 - level 3 478,879 0 - Cost 0 351,937Less accumulated depreciation 0 (78,360)

478,879 273,577

Drainage - Management valuation 2015 - level 3 13,236,250 0 - Cost 0 125,366Less accumulated depreciation 0 (48,338)

13,236,250 77,028

Bridges - Management valuation 2015 - level 3 18,799,920 0 - Cost 0 347,915Less accumulated depreciation 0 (49,863)

18,799,920 298,052

119,673,099 90,484,592

The fair value of infrastructure is determined at least every three years in accordance with legislative requirements. Additions since the date of valuation are shown as cost. Given they were acquired at arms length and any accumulated depreciation reflects the usage of service potential, it is considered the recorded written down value approximates fair value. At the end of eachintervening period the valuation is reviewed and, where appropriate, the fair value is updated toreflect current market conditions.This process is considered to be in accordance with Local Government (Financial Management)Regulation 17A (2) which requires infrastructure to be shown at fair value.



8. INFRASTRUCTURE (Continued)

(b) Movements in Carrying Amounts

Movement in the carrying amounts of each class of infrastructure between the beginning and the endof the current financial year.

Balance Carryingas at the Revaluation Impairment Amount

Beginning Increments/ (Losses)/ Depreciation at the Endof the Year Additions (Disposals) (Decrements) Reversals (Expense) Transfers of the Year

$ $ $ $ $ $ $ $

Roads 88,872,158 1,137,748 0 (2,883,268) 0 (939,334) 0 86,187,304

Other Infrastructure 963,777 171,546 0 (148,241) 0 (16,336) 0 970,746

Footpaths 273,577 12,897 0 200,136 0 (7,731) 0 478,879

Drainage 77,028 6,868 0 13,154,838 0 (2,484) 0 13,236,250

Bridges 298,052 340,000 0 18,166,391 0 (4,523) 0 18,799,920

Total infrastructure 90,484,592 1,669,059 0 28,489,858 0 (970,408) 0 119,673,099

The revaluation of infrastructure assets resulted in an increase on revaluation of $28,489,858 in the net value of infrastructure.All of this increase was credited to the revaluation surplus in the Shire's equity (refer Note 13) and was recognised as Changes on Revaluation of non-current assetsin the Statement of Comprehensive Income.

8. INFRASTRUCTURE (Continued)

(c) Fair Value Measurements

Asset ClassFair Value Hierarchy

Valuation Technique Basis of valuationDate of last Valuation

Inputs used

Roads 3 Cost approach using depreciated replacement cost Management Valuation June 2015

Construction costs and current condition (Level 2), residual values and remaining useful life

assessments (Level 3) inputs

Other Infrastructure 3 Cost approach using depreciated replacement cost

Independent Registered Valuers June 2015



Footpaths 3 Cost approach using depreciated replacement cost Management Valuation June 2015



Drainage 3 Cost approach using depreciated replacement cost Management Valuation June 2015



Bridges 3 Cost approach using depreciated replacement cost Management Valuation June 2015



Level 3 inputs are based on assumptions with regards to future values and patterns of consumption utilising current information. If the basis of these assumptions were varied , they have the potential to result in a significantly higher or lower fair value measurement.

During the period there were no changes in the valuation techniques used to determine the fair value of infrastructure using level 3 inputs.





2015 2014$ $

9. TRADE AND OTHER PAYABLES

CurrentSundry creditors 99,492 58,687Accrued interest on debentures 3,694 4,062Accrued salaries and wages 23,779 17,662ATO liabilities 26,154 24,016

153,119 104,427

10. LONG-TERM BORROWINGS

CurrentSecured by floating charge Debentures 79,630 75,424

79,630 75,424

Non-currentSecured by floating charge Debentures 536,809 616,439

536,809 616,439

Additional detail on borrowings is provided in Note 22.

11. PROVISIONS

Provision for Provision forAnnual & Sick Long Service

Leave Leave Total$ $ $

Opening balance at 1 July 2014 103,325 84,103 187,428Non-current provisions 0 58,926 58,926

103,325 143,029 246,354

Additional provision 25,326 31,113 56,439Balance at 30 June 2015 128,651 174,142 302,793

ComprisesCurrent 128,651 126,327 254,978Non-current 0 47,815 47,815

128,651 174,142 302,793



2015 2015 2014$ Budget $

$12. RESERVES - CASH/INVESTMENT BACKED

(a) Leave ReserveOpening balance 29,547 29,547 28,545Amount set aside / transfer to reserve 772 960 1,002Amount used / transfer from reserve 0 0 0

30,319 30,508 29,547

(b) Plant Replacement ReserveOpening balance 212,580 212,580 194,589Amount set aside / transfer to reserve 36,176 6,909 57,238Amount used / transfer from reserve 0 (50,000) (39,247)

248,756 169,488 212,580

(c) Building Asset Management ReserveOpening balance 134,210 134,210 101,940Amount set aside / transfer to reserve 3,512 4,362 41,412Amount used / transfer from reserve (2,993) 0 (9,142)

134,729 138,572 134,210

(d) Community Associations Financial Assistance ReserveOpening balance 29,804 29,804 23,963Amount set aside / transfer to reserve 4,903 5,069 5,841Amount used / transfer from reserve 0 (1,000) 0

34,707 33,873 29,804

(e) Office and Sundry Equipment ReserveOpening balance 16,467 16,467 6,615Amount set aside / transfer to reserve 431 535 9,852Amount used / transfer from reserve 0 0 0

16,898 17,002 16,467

(f) Waste Management ReserveOpening balance 85,244 85,244 82,353Amount set aside / transfer to reserve 2,227 2,770 2,891Amount used / transfer from reserve 0 0 0

87,471 88,014 85,244

(g) Acquisition and Development of Land ReserveOpening balance 25,048 25,048 108,185Amount set aside / transfer to reserve 30,710 30,814 3,797Amount used / transfer from reserve (20,722) (19,000) (86,934)

35,036 36,862 25,048

(h) Frankland River Works Depot ReserveOpening balance 0 0 30,267Amount set aside / transfer to reserve 0 0 809Amount used / transfer from reserve 0 0 (31,076)

0 0 0

(i) Frankland River Sporting Facilities ReserveOpening balance 268,519 268,519 255,908Amount set aside / transfer to reserve 10,637 12,327 12,611Amount used / transfer from reserve 0 0 0

279,156 280,846 268,519



2015 2015 2014$ Budget $

$12. RESERVES - CASH/INVESTMENT BACKED (CONTINUED)

(j) Housing ReserveOpening balance 121,574 121,574 81,269Amount set aside / transfer to reserve 294,732 3,951 50,015Amount used / transfer from reserve (45,439) (50,000) (9,710)

370,867 75,525 121,574

(k) Cranbrook St John Sub-Centre ReserveOpening balance 109,219 109,219 105,515Amount set aside / transfer to reserve 2,853 781 3,704Amount used / transfer from reserve 0 (110,000) 0

112,072 0 109,219

(l) Community Bus ReserveOpening balance 9,244 9,244 5,999Amount set aside / transfer to reserve 3,167 3,900 3,245Amount used / transfer from reserve 0 0 0

12,411 13,144 9,244

(m) Asset Replacement Fund - Frankland River Bowling Green ReserveOpening balance 29,860 29,860 22,030Amount set aside / transfer to reserve 7,822 7,970 7,830Amount used / transfer from reserve 0 0 0

37,682 37,830 29,860

(n) Asset Replacement Fund - Cranbrook Bowling Green ReserveOpening balance 29,860 29,860 22,030Amount set aside / transfer to reserve 7,822 7,970 7,830Amount used / transfer from reserve 0 0 0

37,682 37,830 29,860

(o) Sundry Equipment ReserveOpening balance 0 0 9,294Amount set aside / transfer to reserve 0 0 249Amount used / transfer from reserve 0 0 (9,543)

0 0 0

(p) Frederick Square Maintenance ReserveOpening balance 0 0 5,310Amount set aside / transfer to reserve 0 0 1,142Amount used / transfer from reserve 0 0 (6,452)

0 0 0

(q) Rate Discount ReserveOpening balance 86,384 86,384 0Amount set aside / transfer to reserve 172,916 172,457 163,667Amount used / transfer from reserve 0 (70,980) (77,283)

259,300 187,861 86,384

TOTAL RESERVES 1,697,086 1,147,357 1,187,560

Total Opening balance 1,187,560 1,187,560 1,083,812Total Amount set aside / transfer to reserve 578,680 260,777 373,135Total Amount used / transfer from reserve (69,154) (300,980) (269,387)TOTAL RESERVES 1,697,086 1,147,357 1,187,560

12. RESERVES - CASH/INVESTMENT BACKED (CONTINUED)

In accordance with council resolutions in relation to each reserve account, the purpose for whichthe funds are set aside are as follows:

(a) Leave Reserve

(b) Plant Replacement Reserve

(c) Building Asset Management Reserve

(d) Community Associations Financial Assistance Reserve

(e) Office and Sundry Equipment Reserve

(f) Waste Management Reserve

(g) Acquisition and Development of Land Reserve

(h) Frankland River Works Depot Reserve

(i) Frankland River Sporting Facilities Reserve

(j) Housing Reserve

(k) Cranbrook St John Sub-Centre Reserve

(l) Community Bus Reserve

(m) Asset Replacement Fund - Frankland River Bowling Green Reserve

(n) Asset Replacement Fund - Cranbrook Bowling Green Reserve

(o) Sundry Equipment Reserve

(p) Frederick Square Maintenance Reserve

(q) Rate Discount Reserve

- to be used in the provision of interest free loans to community organisations

All of the reserve accounts are supported by money held in financial institutions and match the

- to be used for assisting to fund major repairs and maintenance to the Frederick Square Pavilion

- to be used for assisting to fund improvements to existing and new community facilities

- to be used for the acquisition and development of land

- to be used for the upgrading of sporting facilites in Frankland River

- to be used for the establishment and/or improvements of waste disposal sites

- to be used for the replacement of the synthetic bowling green at Frankland River

- to be used for fundinf the building of new and major maintenance of Council housing



- to be used for the acquisition or replacement of office equipment and furniture

- to be used to fund long service leave requirements

- to be used for the purchase of major plant and equipment

- to be used to fund major asset maintenance requirements on Council owned public buildings

- to be used to assist in funding the building of a new St John Sub-Centre in Cranbrook

- to be used to assist in funding the purchase of new Community Buses

- to be used for the creation of a works depot in Frankland River

- to be used for the acquisition or replacement of sundry equipment

- to be used for the replacement of the synthetic bowling green at Cranbrook

amount shown as restricted cash in Note 3 to this financial report.



12. RESERVES - CASH/INVESTMENT BACKED (CONTINUED)

The Frankland River Works Depot Reserve, the Sundry Equipment Reserve and the Frederick

13. REVALUATION SURPLUS 2015 2014Revaluation surpluses have arisen onrevaluation of the following classes ofnon-current assets:

(a) Land and buildingsOpening balance 4,087,746 0Revaluation increment 0 4,087,746Revaluation decrement 0 0Adjustment on sale of assets (158,053) 0

3,929,693 4,087,746

(b) Furniture and EquipmentOpening balance 87,449 87,449Revaluation increment 0 0Revaluation decrement 0 0Adjustment on sale of assets (2,579)

84,870 87,449

(c) Plant and EquipmentOpening balance 314,667 314,667Revaluation increment 0 0Revaluation decrement 0 0Adjustment on sale of assets (12,833)

301,834 314,667

(d) InfrastructureOpening balance 33,174,579 33,174,579Revaluation increment 28,489,858 0Revaluation decrement 0 0

61,664,437 33,174,579

(e) Financial AssetsOpening balance 49,027 54,363Revaluation increment 0 0Revaluation decrement (2,787) (5,337)

46,240 49,027

TOTAL ASSET REVALUATION SURPLUS 66,027,074 37,713,468

All of the reserves except those listed below are reviewed annually and are not expected to be used within a forseeable set period as further transfers to the reserve accounts are expected as funds are utilised.

Square Maintenance Reserve were closed during 2013/2014.



14. NOTES TO THE STATEMENT OF CASH FLOWS

(a) Reconciliation of Cash

For the purposes of the Statement of Cash Flows, cash includes cash and cash equivalents,net of outstanding bank overdrafts. Cash at the end of the reporting period is reconciled to therelated items in the Statement of Financial Position as follows:

2015 2015 2014$ Budget $

$

Cash and cash equivalents 2,953,346 1,347,357 1,665,163

(b) Reconciliation of Net Cash Provided ByOperating Activities to Net Result

Net result 1,974,145 2,338,313 1,063,567

Non-cash flows in Net result:Depreciation 1,673,342 1,565,080 1,551,463(Profit)/Loss on sale of asset (7,245) (38,000) 134,840

Changes in assets and liabilities:(Increase)/Decrease in receivables 17,458 40,715 258,390(Increase)/Decrease in inventories 5,156 6,866 (1,819)Increase/(Decrease) in payables 48,692 30,646 (25,807)Increase/(Decrease) in provisions 56,439 12,572 54,391

Grants contributions for the development of assets (1,738,980) (2,735,614) (1,688,132)Net cash from operating activities 2,029,007 1,220,578 1,346,892

2015 2014(c) Undrawn Borrowing Facilities $ $

Credit Standby ArrangementsBank overdraft limit 0 0Bank overdraft at balance date 0 0Credit card limit 5,000 5,000Credit card balance at balance date (695) (1,670)Total amount of credit unused 4,305 3,330

Loan facilitiesLoan facilities - current 79,630 75,424Loan facilities - non-current 536,809 616,439Total facilities in use at balance date 616,439 691,863

Unused loan facilities at balance date NIL 114,186



15. CONTINGENT LIABILITIES

2015 201416. CAPITAL AND LEASING COMMITMENTS $ $

(a) Operating Lease Commitments

Payable:- not later than one year 8,864 8,376- later than one year but not later than five years 26,593 0- later than five years 0 0

35,457 8,376

(b) Capital Expenditure Commitments

Contracted for:- capital expenditure projects 106,364 126,805- plant & equipment purchases 0 0

Payable:- not later than one year 106,364 126,805

17. JOINT VENTURE ARRANGEMENTS

18. TOTAL ASSETS CLASSIFIED BY FUNCTION AND ACTIVITY2015 2014

$ $

Governance 3,873,602 3,812,637Law, Order, Public Safety 1,246,376 966,937Community amenities 1,710,608 1,474,467Recreation and culture 7,618,414 8,120,815Transport 119,213,909 89,589,285Economic services 1,200,741 1,115,889Other property and services 2,451,489 2,999,268Unallocated 3,204,766 1,949,683

140,519,905 110,028,981

The capital expenditure project outstanding at the end of the 2015 reporting period representsthe construction of the new clubrooms for the Tenterden Tennis Club.

The Shire is not involved in any joint venture arrangements.

The Council has no contingent liabilities as at 30 June 2015.

Non-cancellable operating leases contracted for but

The capital expenditure project outstanding at the end of the 2014 reporting period representsthe construction of the new residence at Lot 9 Edward Street Cranbrook.



2015 2014 201319. FINANCIAL RATIOS

Current ratio 2.722 1.585 2.399Asset sustainability ratio 1.615 1.503 2.011Debt service cover ratio 17.485 9.082 9.208Operating surplus ratio 0.084 (0.241) (0.266)Own source revenue coverage ratio 0.590 0.483 0.565

The above ratios are calculated as follows:

Current ratio current assets minus restricted assetscurrent liabilities minus liabilities associated

with restricted assets

Asset sustainability ratioDepreciation expenses

Debt service cover ratio annual operating surplus before interest and depreciationprincipal and interest

Operating surplus ratio operating revenue minus operating expensesown source operating revenue

Own source revenue coverage ratio own source operating revenueoperating expenses

Notes:

Information relating to the asset consumption ratio and the asset renewal funding ratiocan be found at Supplementary Ratio Information on Page 59 of this document.

20. TRUST FUNDS

Funds held at balance date over which the Shire has no control and which are not included inthe financial statements are as follows:

Balance Amounts Amounts Balance1 July 2014 Received Paid 30 June 2015

$ $ ($) $

Staff Housing Bonds 4,150 1,923 (3,575) 2,498On-Line Licensing 8,137 338,945 (344,937) 2,145Housing Deposit - Frahm 2,500 0 0 2,500Housing Deposit - Challenor 2,500 0 0 2,500

17,287 9,643

capital renewal and replacement expenditure



21. DISPOSALS OF ASSETS - 2014/15 FINANCIAL YEAR

The following assets were disposed of during the year.

Sale Price Profit (Loss)

Written Down Value

Write Back Fair Value

AdjustmentActual Budget Actual Budget Actual Budget

$ $ $ $ $ $ $ $Plant and EquipmentGovernanceHolden Caprice 40,637 0 40,637 40,500 39,739 40,000 (898) (500)Holden Caprice 39,207 0 39,207 40,500 37,670 40,000 (1,537) (500)Holden Captiva 7 33,570 0 33,570 33,000 30,000 32,500 (3,570) (500)Holden Captiva 7 32,560 0 32,560 33,000 30,000 32,500 (2,560) (500)Holden Captiva 7 31,016 0 31,016 33,000 29,091 32,500 (1,925) (500)Holden Captiva 7 30,793 0 30,793 33,000 29,090 32,500 (1,703) (500)TransportHolden Colorado 7 36,092 0 36,092 33,500 32,727 33,000 (3,365) (500)Holden Colarado 7 34,266 0 34,266 33,500 32,727 33,000 (1,539) (500)Holden Colorado Dual Cab 35,265 0 35,265 33,500 32,727 33,000 (2,538) (500)Holden Colorado Dual Cab 34,165 0 34,165 33,500 32,727 33,000 (1,438) (500)Holden Colorado Ute 23,062 0 23,062 23,000 21,881 27,000 (1,181) 4,000Holden Colorado Dual Cab 31,084 0 31,084 31,000 27,739 37,000 (3,345) 6,000Holden Colorado Ute 22,901 0 22,901 23,000 21,881 27,000 (1,020) 4,000Holden Colorado Ute 26,625 0 26,625 23,000 23,171 27,000 (3,454) 4,000Isuzu 6x4 Side Tipper 82,509 2,987 85,496 87,000 78,992 95,000 (3,517) 8,000Volvo Excavator 42,055 (7,188) 34,868 45,000 45,000 60,000 2,945 15,000Skidsteer Trailer 0 0 0 0 0 1,000 0 1,000Mobile Fuel Tanker 0 0 0 0 0 1,000 0 1,000Furniture and EquipmentGovernanceMain Server Upgrade 12 (924) (912) 0 0 0 (12) 0Terminal Server 16 (1,297) (1,281) 0 0 0 (16) 0Main Server Hard Drive 187 18 205 0 0 0 (187) 0Cranbrook Library Shelving 734 (2,085) (1,351) 0 0 0 (734) 0

Net Book Value

21. DISPOSALS OF ASSETS - 2014/15 FINANCIAL YEAR (Continued)

Sale Price Profit (Loss)

Written Down Value

Write Back Fair Value

AdjustmentActual Budget Actual Budget Actual Budget

$ $ $ $ $ $ $ $Land and BuildingsHousingLand Lot 77 Gordon St 45,000 (44,000) 1,000 0 45,000 0 0 0House Lot 77 Gordon St 118,198 (49,033) 69,165 0 139,165 0 20,967 0Land Lot 217 Grantham St 35,000 (34,000) 1,000 0 35,000 0 0 0House Lot 217 Grantham St 54,084 (31,021) 23,063 0 71,956 0 17,872 0

829,038 (166,543) 662,496 579,000 836,283 617,000 7,245 38,000

Profit 41,784 43,000Loss (34,539) (5,000)

7,245 38,000Plant and Equipment sold in 13/14 where loss not realised through operating statement

Profit/Loss 14/15

$Furniture and EquipmentGovernanceIncrease Loss (1,709)Plant and EquipmentGovernanceIncrease Loss (5,608)Transport Total Profit 41,784Decrease Loss 14,241 Total Loss (27,615)Loss 6,924 14,169



Net Book Value



22. INFORMATION ON BORROWINGS

(a) Repayments - Debentures

Principal Principal Principal InterestNew Repayments 30 June 2015 Repayments

Loans Actual Budget Actual Budget Actual BudgetParticulars $ $ $ $ $ $ $ $HousingLoan 75 - Currie St Units 213,744 0 27,703 27,703 186,041 186,041 12,791 12,791Loan 77 - Staff Housing 300,000 0 24,636 24,636 275,364 275,364 12,320 12,688Recreation and cultureLoan 76 - Frederick Square Amenities 178,119 0 23,086 23,086 155,033 155,033 10,660 12,006

691,863 0 75,425 75,425 616,438 616,438 35,771 37,485

All loan repayments were financed by general purpose revenue.

(b) New Debentures - 2014/15

(c) Unspent Debentures

Date Balance Borrowed Expended BalanceBorrowed 1 July 14 During During 30 June 15

$ Year Year $Particulars $ $Loan 77 - Staff Housing Mar 2014 114,186 0 114,186 0

114,186 0 114,186 0

(d) Overdraft

The Council has no overdraft arrangements in place.

The Shire did not take up any new debentures during the year ended 30 June 2015.

1 July 2014



23. RATING INFORMATION - 2014/15 FINANCIAL YEAR

(a) Rates Rate in Number Rateable Rate Interim Back Total Budget Budget Budget Budget$ of Value Revenue Rates Rates Revenue Rate Interim Back Total

Properties $ $ $ $ $ Revenue Rate Rate RevenueRATE TYPE $ $ $ $General rate

Gross rental value valuations 0.1023 246 2,106,346 215,374 (386) 0 214,988 215,374 1,000 0 216,374

Unimproved value valuations 0.0085 433 213,400,500 1,820,946 54 0 1,821,000 1,822,619 0 0 1,822,619Sub-Totals 679 215,506,846 2,036,320 (332) 0 2,035,988 2,037,993 1,000 0 2,038,993

MinimumMinimum payment $

Gross rental value valuations 475 140 222,212 66,500 0 0 66,500 66,500 0 0 66,500

Unimproved value valuations 475 34 765,613 16,150 0 0 16,150 16,150 0 0 16,150Sub-Totals 174 987,825 82,650 0 0 82,650 82,650 0 0 82,650

2,118,638 2,121,643Discounts/concessions (refer note 26) (131) 0Total amount raised from general rate 2,118,507 2,121,643Specified Area Rate (refer note 24) 0 0

Totals 2,118,507 2,121,643



23. RATING INFORMATION - 2014/15 FINANCIAL YEAR (Continued)

(b)

2015 2015 2014

Carried Forward) Brought Forward) Carried Forward)$ $ $

Surplus/(Deficit) 1 July 14 brought forward 1,282,768 565,691 565,691

Comprises:Cash and cash equivalents

Unrestricted 1,082,261 352,718 352,718Restricted 1,871,085 1,312,445 1,312,445

ReceivablesRates outstanding 62,230 108,393 108,393Sundry debtors 38,775 16,407 16,407GST receivable 23,133 13,187 13,187Loans - clubs/institutions 7,100 7,700 7,700

InventoriesFuel and materials 31,710 36,866 36,866

Less:Trade and other payables

Sundry creditors (99,492) (58,687) (58,687)Accrued interest on debentures (3,694) (4,062) (4,062)ATO liabilities (26,154) (24,016) (24,016)

Current portion of long term borrowingsSecured by floating charge (79,630) (75,424) (75,424)

Net current assets 2,907,324 1,685,527 1,685,527Less:Reserves - restricted cash (1,697,086) (1,187,560) (1,187,560)Loans - Clubs/Institutions (7,100) (7,700) (7,700)Add:Secured by floating charge 79,630 75,424 75,424

Surplus/(deficit) 1,282,768 565,691 565,691

Difference

in the 2015 audited financial report and the surplus/(deficit) carried forward position as disclosedin the 2014 audited financial report.

Information on Surplus/(Deficit) Brought Forward

(30 June 2014

There was no difference between the surplus/(deficit) 1 July 2014 brought forward position used

(1 July 2014(30 June 2015

24.

The Shire did not impose any Specified Area Rates.

25. SERVICE CHARGES - 2014/15 FINANCIAL YEAR

The Shire did not impose any service charges.

26. DISCOUNTS, INCENTIVES, CONCESSIONS, & WRITE-OFFS- 2014/15 FINANCIAL YEAR

Type Disc % Total BudgetCost/ Cost/Value Value

$ $Sundry Debtors Write-Off N/A 92 0Rate Assessments Write-Off N/A 131 500

223 500

The Council did not offer a rate discount for the 2014/2015 financial year.

A prize draw was conducted as an incentive for the prompt payment of property rates accounts.All ratepayers who paid their account in full by the due date (5 September 2014) were eligible fora prize. Prize winners were drawn at random and prizes consisted of a refund of property rates up to the value of $1,000 and other prizes donated by local businesses.

27. INTEREST CHARGES AND INSTALMENTS - 2014/15 FINANCIAL YEAR

Interest Admin. Revenue BudgetedRate Charge $ Revenue

% $ $Interest on unpaid rates 11.00% 0 11,006 14,000Interest on sundry debtors 11.00% 0 532 150Interest on instalments plan 5.50% 0 8,952 8,500Charges on instalment plan 5 2,290 2,000Pensioner deferred rate interest 0 166 0

22,946 24,650

Ratepayers had the option of paying rates by two or four equal instalments. Due dates were as follows:Rate Notice Issued 1 August 2014Due Date for Payment in Full 5 September 2014Due Date for First Instalment 5 September 2014

Two Instalment OptionDue Date for Second Instalment 5 January 2015

Four Instalment OptionDue Date for Second Instalment 5 November 2014Due Date for Third Instalment 5 January 2015Due Date for Fourth Instalment 5 March 2015



SPECIFIED AREA RATE - 2014/15 FINANCIAL YEAR

2015 201428. FEES & CHARGES $ $

Governance 449 691General purpose funding 7,975 19,402Law, order, public safety 9,841 8,465Health 1,373 1,163Education and welfare 0 836Housing 67,064 64,490Community amenities 71,510 70,757Recreation and culture 7,132 4,210Transport 17,364 17,141Economic services 114,940 111,864Other property and services 42,651 19,583

340,299 318,602

There were no changes during the year to the amount of the fees or charges detailed in the original

29. GRANT REVENUEGrants, subsidies and contributions are included as operatingrevenues in the Statement of Comprehensive Income:

2015 2014By Nature or Type: $ $Operating grants, subsidies and contributions 2,420,644 2,267,024Non-operating grants, subsidies and contributions 1,738,980 1,688,132

4,159,624 3,955,156By Program:Governance 21,186 25,311General purpose funding 1,938,666 578,868Law, order, public safety 413,909 339,846Health 2,600 0Education and welfare 7,485 1,068Housing 760 0Community amenities 184,456 323,045Recreation and culture 86,865 23,491Transport 1,318,771 2,489,263Economic services 79,671 132,632Other property and services 105,255 41,632

4,159,624 3,955,156

30. EMPLOYEE NUMBERS

The number of full-time equivalentemployees at balance date 26 26

2015 2015 201431. ELECTED MEMBERS REMUNERATION $ Budget $

$The following fees, expenses and allowances werepaid to council members and/or the president.

Meeting Fees 50,000 50,000 48,483President’s allowance 6,000 6,000 6,000Deputy President’s allowance 1,500 1,500 1,500Travelling expenses 0 500 0Telecommunications allowance 6,000 6,000 5,819

63,500 64,000 61,802

budget.



32. MAJOR LAND TRANSACTIONS

The Shire did not participate in any major land transactions during the 2014/15 financial year.

33. TRADING UNDERTAKINGS AND MAJOR TRADING UNDERTAKINGS



financial year.The Shire did not participate in any trading undertakings or major trading undertakings during the 2014/15



34. FINANCIAL RISK MANAGEMENT

foreign currency risk.

Carrying Value Fair Value2015 2014 2015 2014

$ $ $ $Financial assetsCash and cash equivalents 2,953,346 1,665,163 2,953,346 1,665,163Investments 55,879 58,666 55,879 58,666Receivables 163,829 188,987 163,829 188,986

3,173,054 1,912,816 3,173,054 1,912,815

Financial liabilitiesPayables 153,119 104,427 153,119 104,427Borrowings 616,439 691,863 552,957 615,295

769,558 796,290 706,076 719,722

Fair value is determined as follows:• Cash and cash equivalents, receivables, payables - estimated to the carrying value whichapproximates net market value.

• Borrowings, estimated future cash flows discounted by the current market interest ratesapplicable to assets and liabilities with similar risk profiles.

• Investments - based on quoted market prices at the reporting date or at independent valuation.

The Shire’s activities expose it to a variety of financial risks including price risk, credit risk, liquidity risk and

The Shire does not engage in transactions expressed in foreign currencies and is therefore not subject to

Financial risk management is carried out by the finance area under policies approved by the Council.

The Shire held the following financial instruments at balance date:

interest rate risk. The Shire’s overall risk management focuses on the unpredictability of financialmarkets and seeks to minimise potential adverse effects on the financial performance of the Shire.



34. FINANCIAL RISK MANAGEMENT (Continued)(a) Cash and Cash Equivalents

Financial assets at fair value through profit and lossAvailable-for-sale financial assetsHeld-to-maturity investments

The major risk associated with investments is price risk - the risk that the capital value of investmentsmay fluctuate due to changes in market prices, whether these changes are caused by factors specificto individual financial instruments of their issuers or factors affecting similar instruments traded in amarket.

could affect returns.

2015 2014$ $

Impact of a 10% (1) movement in price of investments

- Equity 5,588 5,867 - Statement of Comprehensive Income 5,588 5,867

Impact of a 1% (1) movement in interest rates on cash

- Equity 29,533 16,652 - Statement of Comprehensive Income 29,533 16,652

Notes:(1)

Cash and investments are also subject to interest rate risk - the risk that movements in interest rates

Another risk associated with cash is credit risk – the risk that a contracting entity will not complete its

The Shire manages these risks by diversifying its portfolio and only investing ininvestments authorised

The Shire’s objective is to maximise its return on cash and investments whilst maintaining an adequate

obligations under a financial instrument resulting in a financial loss to the Shire.

by Local Government (Financial Management) Regulation 19C . Council also seeks advice from independent advisers (where considered necessary) before placing any cash and investments.

Sensitivity percentages based on management's expectation of future possible market movements.

level of liquidity and preserving capital. The finance area manages the cash and investments portfolio with the assistance of independent advisers (where applicable). Council has an investment policy and the policy is subject to review by Council. An Investment Report is provided to Council on a monthly basis setting out the make-up and performance of the portfolio.



34. FINANCIAL RISK MANAGEMENT (Continued)(b) Receivables

most non-rate debtors.

2015 2014

Percentage of rates and annual charges

- Current 0% 0% - Overdue 100% 100%

Percentage of other receivables

- Current 89% 81% - Overdue 11% 19%

The profile of the Shire’s credit risk at balance date was:

The Shire makes suitable provision for doubtful receivables as required and carries out credit checks on

There are no material receivables that have been subject to a re-negotiation of repayment terms.

monitored for acceptable collection performance.

risk associated with these receivables is credit risk – the risk that the debts may not be repaid. TheShire manages this risk by monitoring outstanding debt and employing debt recovery policies. It also

The Shire’s major receivables comprise rates and annual charges and user charges and fees. The major

The level of outstanding receivables is reported to Council monthly and benchmarks are set and

encourages ratepayers to pay rates by the due date through incentives.

a secured charge over the land – that is, the land can be sold to recover the debt. The Shire is also ableto charge interest on overdue rates and annual charges at higher than market rates, which further encourages payment.

Credit risk on rates and annual charges is minimised by the ability of the Shire to recover these debts as



34. FINANCIAL RISK MANAGEMENT (Continued)(c) Payables

Borrowings

Due Due Due Totalwithin between after contractual Carrying1 year 1 & 5 years 5 years cash flows values

$ $ $ $ $2015

Payables 153,119 0 0 153,119 153,119Borrowings 111,563 446,254 186,415 744,232 616,439

264,682 446,254 186,415 897,351 769,558

2014

Payables 104,427 0 0 104,427 104,427Borrowings 111,563 446,254 297,979 855,796 691,863

215,990 446,254 297,979 960,223 796,290

Payables and borrowings are both subject to liquidity risk – that is the risk that insufficient funds may be on hand to meet payment obligations

The contractual undiscounted cash flows of the Shire’s Payables and Borrowings are set out in the Liquidity Sensitivity Table below:

as and when they fall due. The Shire manages this risk by monitoring its cash flow requirements and liquidity levels and maintaining an adequatecash buffer. Payment terms can be extended and overdraft facilities drawn upon if required.



34. FINANCIAL RISK MANAGEMENT (Continued)

(c) PayablesBorrowings (continued)

negotiation.

The following tables set out the carrying amount, by maturity, of the financial instruments exposed to interest rate risk: WeightedAverageEffective

<1 year >1<2 years >2<3 years >3<4 years >4<5 years >5 years Total Interest Rate$ $ $ $ $ $ $ %

Year ended 30 June 2015

Borrowings

Fixed rateDebentures 0 0 0 0 0 616,439 616,439 5.28%Weighted averageEffective interest rate 0.00% 0.00% 0.00% 0.00% 0.00% 5.28%

Year ended 30 June 2014

Borrowings

Fixed rateDebentures 0 0 0 0 0 691,863 691,863 5.30%Weighted averageEffective interest rate 0.00% 0.00% 0.00% 0.00% 0.00% 5.30%

manages this risk by borrowing long term and fixing the interest rate to the situation considered the most advantageous at the time of Borrowings are also subject to interest rate risk - the risk that movements in interest rates could adversely affect funding costs. The Shire

RATIO INFORMATION

2015 2014 2013

Asset consumption ratio 0.993 0.934 0.835Asset renewal funding ratio 1.070 1.069 0.846

The above ratios are calculated as follows:

Asset consumption ratio

Asset renewal funding ratio

depreciated replacement costs of assetscurrent replacement cost of depreciable assets

NPV of planning capital renewal over 10 yearsNPV of required capital expenditure over 10 years

SHIRE OF CRANBROOKSUPPLEMENTARY RATIO INFORMATION

The following information relates to those ratios which only require attestation they have been checkedand are supported by verifiable information. It does not form part of the audited financial report


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