Annual Plan 2016-17 - Approved by Council 27 June 2016
Kingborough Council 2016-17 Annual Plan
Kingborough Council 2016-17 Annual Plan
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7.3 Net Financial Liability Ratio<br />
This measure shows whether <strong>Council</strong>’s total liabilities can be met <strong>by</strong> its liquid assets. An excess of<br />
total liabilities over liquid assets means that, if all the liabilities fell due at once, additional revenue<br />
would be needed to fund the shortfall.<br />
Whilst <strong>Council</strong>’s percentage in 2015/16 is over the 0.0% benchmark, the borrowings associated with<br />
the construction at the Kingston High School site result in a negative ratio in <strong>2016</strong>/<strong>17</strong>. Once the loan<br />
is repaid, the ratio will move to a positive number.<br />
7.4 Asset Consumption Ratio – Roads<br />
The asset consumption ratio indicates the level of service potential available in <strong>Council</strong>’s existing<br />
asset base. The ratio is calculated <strong>by</strong> dividing the depreciated replacement cost over the current<br />
replacement cost and is an indicator of the remaining useful life of the infrastructure asset. The<br />
benchmark for this ratio is between 50% and 80%.<br />
The above ratio for <strong>Council</strong>’s roads, indicate that there is a high level of service potential available<br />
within the existing asset base. Also a positive sign is that the ratio is increasing over the ten year<br />
period as a result of capital expenditure on the road network.<br />
Kingborough <strong>Council</strong> <strong>Annual</strong> <strong>Plan</strong> <strong>2016</strong>/<strong>17</strong> Page | 50<br />
<strong>Approved</strong> <strong>by</strong> <strong>Council</strong> on <strong>27</strong> <strong>June</strong> <strong>2016</strong>
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