Maintenance comprises Council expenditure to maintain its infrastructural and operational assets. This includes the transportation and road network, facilities and parks and Council enterprises, property maintenance. Other Operating Expenses includes general operating expenses, insurance, rating valuation fees, information technology costs, refuse and waste water costs.
NOTE 8: FINANCE EXPENSE AND FINANCE INCOME
Interest revenue is recognised using the effective interest method.
2018/2019
$000 FINANCE EXPENSE 2019/2020
$000
INTEREST EXPENSE
7,928 Interest on borrowings 7,936
– Interest on finance leases –
6 Provisions: discount unwinding –
7,934 Total finance costs 7,936
2018/2019
$000 FINANCE INCOME 2019/2020
$000
INTEREST REVENUE
– Loan fair value adjustment 3,309
1,047 Interest on bank deposits 1,054
140 Interest on related party loans 37
7 Interest on community loans 11
1,194 Total finance revenue 4,411
NOTES TO FINANCIAL STATEMENTS
2018/2019
$000 2019/2020
$000
RELATIONSHIP BETWEEN TAX EXPENSE AND ACCOUNTING PROFIT
33,459 Net surplus 26,899
9,369 Tax at 28% 7,532
(9,369) Less non-taxable income (7,532)
– Deferred tax adjustment –
– Tax expense –
PROPERTY, PLANT AND
EQUIPMENT $000 TAX LOSSES
$000 TOTAL
$000
DEFERRED TAX ASSETS/(LIABILITIES)
Balance at 1 July 2018 (480) 480 –
Charged to surplus or deficit (1) 1 –
Charged to other comprehensive revenue and expense – – –
Balance at 1 July 2019
Charged to surplus or deficit (16) 16 –
Charged to other comprehensive revenue and expense (67) 67 –
Tax expense (564) 564 –
A deferred tax asset has not been recognised in relation to tax losses of $12,114,498 (2019: $11,848,000).
NOTE 9: TAX
Council is exempt from income tax except in relation to distributions from its CCO’s and its port operations.
Income tax expense in relation to the surplus or deficit for the period comprises current tax and deferred tax.
Current tax is the amount of income tax payable based on the taxable profit for the current year, plus any adjustments to income tax payable in respect of prior years. Current tax is calculated using rates that have been enacted or substantively enacted by balance date.
Deferred tax is the amount of income tax payable or recoverable in future periods in respect of temporary differences and unused tax losses. Temporary differences are differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit.
Deferred tax liabilities are generally recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which the deductible temporary differences or tax losses can be utilised.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised, using tax rates that have been enacted or substantively enacted by balance date.
Current and deferred tax is recognised against the surplus or deficit for the period, except to the extent that it relates to transactions recognised in other comprehensive revenue and expense or directly in equity.
NOTES TO FINANCIAL STATEMENTS
NOTE 10: CASH AND CASH EQUIVALENTS
Cash and cash equivalents includes cash-in-hand, deposits held at-call with banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts.
NOTE 11: TRADE AND OTHER RECEIVABLES
Receivables are recorded at their face value, less any provision for impairment.
30 JUNE 2019
$000 CASH AND CASH EQUIVALENTS 30 JUNE 2020
$000
10,273 Cash at bank and in hand 28,709
5,000 Short term deposits maturing three months or less from date of acquisition –
15,273 Total cash and cash equivalents 28,709
30 JUNE 2019
$000 TRADE AND OTHER RECEIVABLES 30 JUNE 2020
$000
1,150 Rates receivables 1,376
15,316 Other receivables 15,580
467 Prepayments 337
16,933 17,293
(499) Less provision for doubtful debts (609)
16,434 16,684
Comprising
16,434 Current portion 16,684
– Non-current –
16,434 Total trade and other receivables 16,684
The carrying value of short-term deposits with maturity dates of three months or less approximates their fair value.
The carrying amount of trade and other receivables approximates their fair value. There is no concentration of credit risk with respect to receivables.
Council does not provide for any impairment on rates receivable as it has various powers under the Local Government (rating) Act 2002 to recover any outstanding debts. These powers allow the Council to commence legal proceedings to recover any rates that remain unpaid four months after the due date for payment. If payment has not been made within three months of the Court’s judgement, then Council can apply to the Registrar of the High Court to have the judgement enforced by sale or lease of the rating unit.
The impairment provision has been calculated based on a review of specific overdue receivables. There has been no collective impairment based on an analysis of past collection history and debt write-offs. Council holds no collateral as security or other credit enhancements over receivables that are either past due or impaired.
NOTES TO FINANCIAL STATEMENTS
Movements in the provision for impairment of receivables is as follows:
NOTE 11: TRADE AND OTHER RECEIVABLES (CONT.)
2018/2019
$000 TRADE AND OTHER RECEIVABLES 2019/2020
$000
(509) At 1 July (499)
(196) Additional provisions made during the year (241)
10 Written off during period 51
196 Provisions reversed in year 80
(499) At 30 June (609)
The status of rates and other receivables as at 30 June 2020 are detailed as below:
The status of other receivables as at 30 June 2019 are detailed as below:
2020
CURRENT AND NON-CURRENT GROSS
$000 IMPAIRMENT
$000 NET
$000
< 30 days 15,079 (1) 15,078
30 – 60 days 156 – 156
61 – 90 days 309 – 309
90+ days 1,413 (608) 805
Total other receivables 16,957 (609) 16,348
2019
CURRENT AND NON-CURRENT GROSS
$000 IMPAIRMENT
$000 NET
$000
Current 13,933 – 13,933
30 – 60 days 359 – 359
61 – 90 days 63 – 63
90+ days 961 (499) 462
Total other receivables 15,316 (499) 14,817