ANNUAL REPORT 2007-2008 CITY OF GREATER GEELONG

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CITY OF GREATER GEELONG NOTES TO THE FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2008 CITY OF GREATER GEELONG ANNUAL REPORT 2007-2008 1 Significant Accounting Policies (cont’d) (f) Recognition and measurement of assets (cont’d) Revaluation Subsequent to the initial recognition of assets, noncurrent physical assets, other than Plant and Equipment, Recreation and Infrastructure Other, are measured at their fair value, being the amount for which the assets could be exchanged between knowledgeable willing parties in an arms length transaction. At balance date, the Council reviewed the carrying value of the individual classes of assets measured at fair value to ensure that each asset materially approximated its fair value. Where the carrying value materially differed from the fair value at balance date the class of asset was revalued. Council has a revaluation timetable for all assets held at fair value. The valuation is performed either by experienced Council officers or independent experts. Where the assets are revalued, the revaluation increments are credited directly to the asset revaluation reserve, except to the extent that an increment reverses a prior year decrement for that class of asset that had been recognised as an expense, in which case the increment is recognised as revenue up to the amount of the expense. Revaluation decrements are recognised as an expense except where prior increments are included in the asset revaluation reserve for that class of asset, in which case the decrement is taken to the reserve to the extent of the remaining increments. Within the same class of assets, revaluation increments and decrements within the year are offset. Kerb and Channel, Footpaths / Bike paths and Roads Other were revalued as at 1-10-2006. Drainage assets were revalued as at 1-7-2005. Assessments showed no material difference between actual value and carrying value as at 30 June 2008. Land and Buildings were revalued as at 1-1-2008 in line with the municipal valuation. The asset values increased $50.0M, there was a write off to the Income Statement of $0.7M for assets disposed and an increase to the Asset Revaluation Reserve of $50.0M. Asset Revaluation Roads Seal Road Pavement Kerb and Channel Footpaths and Bike paths Roads Other Land and Buildings Drainage Cycles 5 years 5 years 5 years 5 years 5 years 2 years 6 years Road Seals and Road Pavements were revalued as at 1-11-2004. Assessment showed no material differences between actual value and carrying value as at 30 June 2008. Leasehold improvements Leasehold improvements are recognised at cost and are amortised over the unexpired period of the lease or the estimated useful life of the improvement, whichever is the shorter. Land under roads The Council has elected not to recognise land under roads as an asset in accordance with AASB 1045 Land under Roads, which extends the requirement to recognise and measure land under roads as an asset of Council until 1 July 2008. (g) Cash and cash equivalents For the purposes of the cash flow statement, cash and cash equivalents include cash on hand, deposits at call, and other highly liquid investments with original maturities of three months or less, net of outstanding bank overdrafts. (h) Investments Managed funds are valued at fair value, being market value, at balance date. Bank deposits and Term deposits are measured at cost. Interest revenues are recognised as they accrue. Any unrealised gains and losses on holdings at balance date are recognised as either a revenue or expense. (i) Accounting for investments in associates Council's investment in associates is accounted for by the equity method as the Council has the ability to influence rather than control the operations of the entities. The investment is initially recorded at the cost of acquisition and adjusted thereafter for post-acquisition changes in the Council's share of the net assets of the entities. The Council's share of the financial result of the entities is recognised in the income statement. The Council has an interest in the Geelong Regional Library Corporation, the Regional Kitchen Pty Ltd and RFK Pty Ltd (trading as Community Chef). They are recorded as non current investments with Council's share of net assets being recognised. 145
CITY OF GREATER GEELONG NOTES TO THE FINANCIAL REPORT FOR THE YEAR ENDED 30 JUNE 2008 1 Significant Accounting Policies (cont’d) (j) Employee benefits Wages and salaries Liabilities for wages and salaries and rostered days off are recognised and measured as the amount unpaid at balance date and include appropriate on-costs such as workers compensation and payroll costs. Annual leave Annual leave entitlements are accrued on a pro rata basis in respect of services provided by employees up to balance date. Annual Leave expected to be paid within 12 months is measured at nominal value based on the amount, including appropriate on-costs, expected to be paid when settled. Annual leave expected to be paid later that one year has been measured at the present value of the estimated future cash outflows to be made for these accrued entitlements. Commonwealth bond rates are used for discounting future cash flows. Long service leave Long service leave entitlements payable are assessed at balance date having regard to expected employee remuneration rates on settlement, employment related oncosts and other factors including accumulated years of employment, on settlement, and experience of employee departure per year of service. Long service leave expected to be paid within 12 months is measured at nominal value based on the amount expected to be paid when settled. Long service leave expected to be paid later than one year has been measured at the present value of the estimated future cash outflows to be made for these accrued entitlements. Commonwealth bond rates are used for discounting future cash flows. Classification of employee benefits An employee benefit liability is classified as a current liability if the Council does not have an unconditional right to defer settlement of the liability for at least 12 months after the end of the period. This would include all annual leave and unconditional long service leave entitlements. Superannuation The superannuation expense for the reporting year is the amount of the statutory contribution the Council makes to the superannuation plan which provides benefits to its employees together with any movements (favourable/unfavourable) in the position of any defined benefits schemes. Details of these arrangements are recorded in note 32. (k) Leases Finance leases Leases of assets where substantially all the risks and benefits incidental to ownership of the asset, but not the legal ownership, are transferred to the Council are classified as finance leases. Council holds no finance leases at balance date. Operating leases Lease payments for operating leases are recognised as an expense in the years in which they are incurred as this reflects the pattern of benefits derived by the Council. (l) Refundable Deposits Amounts received as tender deposits, sundry deposits, street crossing deposits, hall bonds, and other amounts controlled by Council which have to be paid back, are included in the amount disclosed as Refundable Deposits within current liabilities. (m) Allocation between current and non-current In 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 twelve months, being the Council's operational cycle, or if the Council does not have an unconditional right to defer settlement of a liability for at least 12 months after the reporting date. (n) Web site costs Costs in relation to websites are charged as an expense in the period in which they are incurred. (o) 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 Tax Office. In these circumstances the GST is recognised as part of the cost of acquisition of the asset or as part of an item of the expense. Receivables and payables in the balance sheet are shown inclusive of GST. Cash flows are presented in the cash flow statement on a gross basis, except for the GST component of investing and financing activities, which are disclosed as operating cash flows. 146
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ANNUAL REPORT 2007-2008 CITY OF GRE
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THE YEAR’S HIGHLIGHTS Satyam Tech
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OVERVIEW Welcome to the City of Gre
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OUR HISTORY - FROM JILLONG TO GEELO
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THEN NOW Eastern Beach 6
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approaches to address key issues an
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Emily Benstead South Geelong Primar
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MESSAGE FROM THE CHIEF EXECUTIVE OF
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Port Phillip Bay Victoria Corio Bay
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Port Phillip Bay Port Phillip Bay P
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Port Phillip Bay Port Phillip Bay C
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PLANNING AND REPORTING FRAMEWORK Ho
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THE YEAR IN REVIEW At Council we pr
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The City of Greater Geelong commits
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CUSTOMER SERVICE COMMITMENTS AND AC
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Requests for Service In addition to
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COUNCIL FUNDING PRIORITIES Council
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SUMMARY OF FINANCIAL RESULTS FOR 20
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Loans Council took out a loan of $3
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Victorian Local Government Indicato
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BEST VALUE Council’s Best Value P
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COMMUNITY ENGAGEMENT The main purpo
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Consultation events 2007-2008 Depar
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Department Project Project Objectiv
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OUR PEOPLE The knowledge, skills, i
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VALUES AND BEHAVIOURS The City of G
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DIVISIONAL OPERATIONAL PERFORMANCE
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Development Sustainability Kate Sul
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Community Services Irene McGinnigle
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HUMAN RESOURCE MANAGEMENT Staff are
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STAFF PROFILE As at June 30, 2008 t
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EMPLOYEE EXCELLENCE AWARDS This pro
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OUR VOLUNTEERS Volunteering is inte
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CORPORATE GOVERNANCE To enhance com
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INTERNAL AUDIT The internal audit f
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Minutes of meetings of special comm
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COUNCIL APPOINTMENTS TO COMMITTEES
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THE PILLARS: HIGHLIGHTS AND ACHIEVE
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HEALTH AND WELLBEING Objective To h
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Health and Wellbeing - Outcomes Out
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Tamie Baljak Bell Park North Primar
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Jayco Bay Cycling Classic, Eastern
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Delivering on our Commitments: 2007
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Implementing the Local Action Plan
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Delivering on our Commitments: 2007
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Challenges Drought conditions in th
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TRANSPORTATION Objective To enhance
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Transportation - Outcomes Outcome M
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Page 99 and 100: Future Directions Main construction
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Page 117 and 118: Challenges The objective to provide
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Page 129 and 130: UNDERSTANDING THE FINANCIAL REPORT
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CONTACT COUNCIL Many of the City’
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This Annual Report is printed on Mo
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ANNUAL REPORT 2007-2008 CITY OF GREATER GEELONG

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