Local Government Finance Standard 1994

Queensland Local Government Act 1993 LOCAL GOVERNMENT FINANCE STANDARD 1994 Reprinted as in force on 1 July 2003 (includes commenced amendments up to 2003 SL No. 40) Reprint No. 3 This reprint is prepared by the Office of the Queensland Parliamentary Counsel Warning—This reprint is not an authorised copy NOT FURTHER AMENDED LAST REPRINT BEFORE REPEAL See 2005 SL No. 82 s 95

Information about this reprint This standard is reprinted as at 1 July 2003. The reprint— • shows the law as amended by all amendments that commenced on or before that day (Reprints Act 1992 s 5(c)) • incorporates all necessary consequential amendments, whether of punctuation, numbering or another kind (Reprints Act 1992 s 5(d)). The reprint includes a reference to the law by which each amendment was made—see list of legislation and list of annotations in endnotes. Also see list of legislation for any uncommenced amendments. Minor editorial changes allowed under the provisions of the Reprints Act 1992 have also been made to use aspects of format and printing style consistent with current drafting practice (s 35). This page is specific to this reprint. See previous reprints for information about earlier changes made under the Reprints Act 1992. A table of reprints is included in the endnotes. Also see endnotes for information about— • when provisions commenced • editorial changes made in earlier reprints. Dates shown on reprints Reprints dated at last amendment All reprints produced on or after 1 July 2002, hard copy and electronic, are dated as at the last date of amendment. Previously reprints were dated as at the date of publication. If a hard copy reprint is dated earlier than an electronic version published before 1 July 2002, it means the legislation was not further amended and the reprint date is the commencement of the last amendment. If the date of a hard copy reprint is the same as the date shown for an electronic version previously published, it merely means that the electronic version was published before the hard copy version. Also, any revised edition of the previously published electronic version will have the same date as that version. Replacement reprint date If the date of a hard copy reprint is the same as the date shown on another hard copy reprint it means that one is the replacement of the other.

Queensland LOCAL GOVERNMENT FINANCE STANDARD 1994 TABLE OF PROVISIONS Section Page PART 1—PRELIMINARY 1 Short title . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 2 Definitions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 PART 2—FINANCIAL MANAGEMENT Division 1—Policies for financial management 3 Policies to be developed by each local government . . . . . . . . . . . . . . . . . . . 9 4 Policy about contracts for the acquisition of goods and services for less than $10 000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 5 Policy about internal audit. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 6 Policy about an audit committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 7 Policy about borrowings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 8 Revenue policy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 Division 2—Principles of financial management 9 Principles to be complied with in financial management . . . . . . . . . . . . . . . 12 Division 3—Accounting manual 10 Local government to keep accounting manual . . . . . . . . . . . . . . . . . . . . . . . 12 Division 4—Contracts and tendering 11 Exemptions to requirement to seek tenders or quotations—Act, s 486(1)(e) 12 12 Preconditions for establishing a standing offer or preferred supplier arrangement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 13 Preconditions for establishing a register of pre-qualified suppliers . . . . . . . 13 14 Procedure for establishing purchasing arrangements . . . . . . . . . . . . . . . . . . 13 Division 5—Notional GST 14A Certificate about payment of notional GST . . . . . . . . . . . . . . . . . . . . . . . . . 14

2 Local Government Finance Standard 1994 PART 3—CORPORATE AND OPERATIONAL PLANS Division 1—Corporate plans 15 Requirements of corporate plan—Act, s 507 . . . . . . . . . . . . . . . . . . . . . . . . 15 16 Assessment of local and regional issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 17 Consultation process used in preparation of plan . . . . . . . . . . . . . . . . . . . . . 16 Division 2—Operational plans 18 Requirements of operational plans—Act, s 510 . . . . . . . . . . . . . . . . . . . . . . 16 PART 4—FUNDS AND ACCOUNTING PROCEDURES Division 1—Operating fund 19 Operating fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 20 Separate bank accounts within operating fund . . . . . . . . . . . . . . . . . . . . . . . 17 21 Reserves—Act, s 515 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 Division 2—Trust fund 22 Trust fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 23 Funds that should not be part of trust fund . . . . . . . . . . . . . . . . . . . . . . . . . . 18 24 Funds incorrectly paid into operating fund . . . . . . . . . . . . . . . . . . . . . . . . . . 18 25 Reconciliation of trust fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 PART 5—BUDGET AND REVENUE STATEMENT 26 Budget to be prepared on an accrual basis . . . . . . . . . . . . . . . . . . . . . . . . . . 18 27 Requirements of budget—Act, s 519 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 28 Requirements for revenue statement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 29 Amendment of budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 30 Disbursement because of genuine emergency or hardship—Act, s 519(4). . 20 31 Financial information to be presented to budget meeting—Act, s 521. . . . . 20 PART 6—ACCOUNTS Division 1—Accounting records 33 Systems to support account keeping . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Division 2—Non-current assets 35 Register of non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 Division 3—Non-current asset valuation 36 Value of non-current assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 39 Certain land and roads do not have a value . . . . . . . . . . . . . . . . . . . . . . . . . . 23

3 Local Government Finance Standard 1994 PART 7—ANNUAL REPORT Division 1—Annual reports generally 44 Annual report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 45 Note about reserves and roads controlled by local governments . . . . . . . . . 24 Division 2—Financial statements in annual report 46 Annual financial statements—Act, s 532 . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 47 Period to which statements relate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 48 Financial statements to include statement for significant business activities 25 53 Signing of financial statements—Act, s 532 . . . . . . . . . . . . . . . . . . . . . . . . . 25 54 Certificate for proposed financial statements . . . . . . . . . . . . . . . . . . . . . . . . 26 55 Certificate for final financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 56 Differences between proposed and final financial statements. . . . . . . . . . . . 26 57 Unaudited financial statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 PART 8—FULL COST PRICING Division 1—Preliminary 58 Object of pt 8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 59 Application of pt 8. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Division 2—Full cost pricing Subdivision 1—Matters affecting full cost pricing 60 Matters affecting full cost pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 Subdivision 2—Full cost pricing 61 Application of full cost pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 62 Different charges for commercial reasons. . . . . . . . . . . . . . . . . . . . . . . . . . . 28 63 Total costs of carrying on activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 64 Administrative and overhead costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 65 Cost of resources used in carrying on activity . . . . . . . . . . . . . . . . . . . . . . . 29 66 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 67 Equivalents for taxes not otherwise liable to be paid . . . . . . . . . . . . . . . . . . 30 68 Return on capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 Subdivision 3—Treatment of community service obligations 69 Extra cost for community service obligations to be treated as revenue . . . . 31

4 Local Government Finance Standard 1994 PART 9—COMMERCIALISATION Division 1—Preliminary 70 Object of pt 9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 71 Application of pt 9. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Division 2—Commercialisation Subdivision 1—Matters affecting commercialisation 72 Matters affecting commercialisation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 Subdivision 2—Full cost pricing 73 Application of full cost pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 74 Different charges for commercial reasons. . . . . . . . . . . . . . . . . . . . . . . . . . . 32 75 Total costs of carrying on activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 76 Administrative and overhead costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 77 Cost of resources used in carrying on activity . . . . . . . . . . . . . . . . . . . . . . . 33 78 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 79 Return on capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 Subdivision 3—Treatment of community service obligations 80 Extra cost for community service obligations to be treated as revenue . . . . 34 Subdivision 4—Annual performance plan 81 Annual performance plan for each commercial business unit . . . . . . . . . . . 35 PART 10—CODE OF COMPETITIVE CONDUCT Division 1—Preliminary 82 Object of pt 10. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 83 Application of code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 Division 2—The code Subdivision 1—Elements of the code 84 Elements of the code . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 Subdivision 2—Full cost pricing 85 Application of full cost pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 86 Different charges for commercial reasons. . . . . . . . . . . . . . . . . . . . . . . . . . . 37 87 Total costs of carrying on activity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 88 Administrative and overhead costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 89 Cost of resources used in carrying on activity . . . . . . . . . . . . . . . . . . . . . . . 38

5 Local Government Finance Standard 1994 90 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 91 Equivalents for taxes not otherwise liable to be paid . . . . . . . . . . . . . . . . . . 92 Equivalents for State guarantees on borrowings . . . . . . . . . . . . . . . . . . . . . . 93 Return on capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Subdivision 3—Treatment of community service obligations 94 Extra cost for community service obligations to be treated as revenue . . . . 95 Community service obligations not to be part of roads business activities. . Subdivision 4—Elimination of, or taking into account, advantages and disadvantages of public ownership 96 Effect of advantages or disadvantages of public ownership . . . . . . . . . . . . . Subdivision 5—Financial reporting 97 Statement in budget . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 98 Omission of certain matters from statement in budget . . . . . . . . . . . . . . . . . 99 Statement in annual report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 100 Omission of certain matters from statement in annual report . . . . . . . . . . . . PART 11—REFORM OF CERTAIN WATER AND SEWERAGE SERVICES Division 1—Preliminary 101 Object of pt 11. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Division 2—Matters to be complied with Subdivision 1—Matters to be complied with for relevant business activities 102 Matters to be complied with for relevant business activities. . . . . . . . . . . . . Subdivision 2—Two-part tariffs 103 Utility charges if two-part tariffs applied . . . . . . . . . . . . . . . . . . . . . . . . . . . Subdivision 3—Consumption as the basis for utility charges for water services 104 Application of sdiv 3 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 105 Consumption as the basis for utility charges. . . . . . . . . . . . . . . . . . . . . . . . . 106 When charges are based on quantity of water supplied . . . . . . . . . . . . . . . . Subdivision 4—Full cost recovery 107 Application of sdiv 4 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 108 Application of full cost recovery. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 109 Total costs of carrying on relevant business activity . . . . . . . . . . . . . . . . . . . 38 39 39 39 40 40 40 41 42 42 43 43 44 44 45 45 45 46 46 46

6 Local Government Finance Standard 1994 110 Administrative and overhead costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 111 Cost of resources used in carrying on relevant business activity . . . . . . . . . 112 Depreciation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 113 Return on capital . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Subdivision 5—Treatment of community service obligations 114 Extra cost for community service obligations to be treated as revenue . . . . Subdivision 6—Identification and disclosure of cross-subsidies between classes of consumers 115 Disclosure of cross-subsidies in annual report . . . . . . . . . . . . . . . . . . . . . . . 116 Identification and disclosure of cross-subsidies . . . . . . . . . . . . . . . . . . . . . . Subdivision 7—Disclosure of community service obligations 117 Disclosure of community service obligations . . . . . . . . . . . . . . . . . . . . . . . . 47 47 47 47 48 48 48 49 ENDNOTES 1 Index to endnotes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 2 Date to which amendments incorporated. . . . . . . . . . . . . . . . . . . . . . 50 3 Key . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 4 Table of reprints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 5 Tables in earlier reprints. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 6 List of legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 7 List of annotations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 8 Table of renumbered provisions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61

s1 7 s2 Local Government Finance Standard 1994 LOCAL GOVERNMENT FINANCE STANDARD 1994 [as amended by all amendments that commenced on or before 1 July 2003] PART 1—PRELIMINARY 1 Short title This standard may be cited as the Local Government Finance Standard 1994 . 2 Definitions In this standard— “abstracts of the Urgent Issues Group” means the abstracts of the Urgent Issues Group published by the Australian Accounting Standards Board. 1 “accounting standards” means— (a) the accounting standards issued by the Australian Accounting Standards Board; or (b) the Australian Accounting Standards issued jointly by or for the National Councils of CPA Australia and the Institute of Chartered Accountants in Australia. 2 “adopted budget” of a local government means the original budget adopted by it and any amendments to the budget adopted by it. “bank account” means an account with a financial institution. “commercialisation” , for part 9, see section 575 3 of the Act. 1 The abstracts can be accessed on the Internet at www.aasb.com.au. 2 The accounting standards issued by the Australian Accounting Standards Board and the Australian Accounting Standards can be accessed on the internet at www.aasb.com.au. 3 Section 575 (Meaning of “commercialisation”) of the Act

s2 8 s2 Local Government Finance Standard 1994 “Commonwealth tax” means tax imposed under a Commonwealth Act. “community service obligations” means— (a) for an activity carried on by a corporatised corporation under chapter 8, part 7 of the Act—see section 677 4 of the Act; or (b) for an activity carried on by a commercial business unit of a local government—see section 577 5 of the Act; or (c) for another activity carried on by a local government—the obligations to do anything the local government is satisfied— (i) if the activity were to be carried on by an entity with the primary object of making a profit—would not be in the entity’s commercial interests to perform; and (ii) arise because of a direction by the local government. “entity” , for part 11, see section 102. 6 “full cost pricing” , for part 8, see section 568 7 of the Act. “LGA arrangement” means an arrangement— (a) entered into by— (i) the Local Government Association; or (ii) a company registered under the Corporations Act if the association is its only shareholder; and (b) that would be a purchasing arrangement if entered into by a local government; and (c) for which the procedure set out in section 14 8 has been followed by the association or company as if it were a local government. “original budget” , of a local government, means the budget adopted at the local government’s budget meeting. “preferred supplier arrangement” for a local government means an arrangement by the local government with a supplier for the supply of goods or services under agreed pricing conditions for a stated period. 4 Section 677 (Meaning of “community service obligations”) of the Act 5 Section 577 (Definitions for pt 6) of the Act 6 Section 102 (Matters to be complied with for relevant business activities) 7 Section 568 (Meaning of “full cost pricing”) of the Act 8 Section 14 (Procedure for establishing purchasing arrangements)

s3 9 s3 Local Government Finance Standard 1994 “pre-qualified supplier” for a local government means a supplier who has been assessed by the local government as having the technical, financial and managerial capability necessary to perform contracts on time and in accordance with agreed requirements. “purchasing arrangement” means— (a) a standing offer arrangement; or (b) a preferred supplier arrangement; or (c) a register of pre-qualified suppliers. “relevant business activity” , for part 11, see section 772 9 of the Act. “roads business activity” , for part 10, see section 761 10 of the Act. “standing offer arrangement” for a local government means an arrangement to which the local government is a party with a supplier for the supply of goods or services at a fixed price for a stated period. “statements of accounting concepts” means the statements of accounting concepts issued jointly by or for the National Councils of CPA Australia and the Institute of Chartered Accountants Australia. 11 “State tax” means tax imposed under the Act, or another Act. “tax” includes a charge, duty, fee, levy or rate. PART 2—FINANCIAL MANAGEMENT Division 1—Policies for financial management 3 Policies to be developed by each local government A local government must develop the following financial management policies— 9 Section 772 (Definitions for ch 10) of the Act 10 Section 761 (Definitions for ch 9) of the Act 11 The statements can be accessed on the Internet at www.aasb.com.au.

s 4 10 s 5 Local Government Finance Standard 1994 (a) a policy about contracts for the acquisition of goods and services for less than $10 000; (b) a policy about internal audit; (c) a policy about an audit committee; (d) a policy about borrowings; (e) revenue policy; (f) a policy about the carrying out of the principles governing the making of contracts mentioned in section 481 of the Act. 4 Policy about contracts for the acquisition of goods and services for less than $10 000 A local government’s policy about contracts for the acquisition of goods and services for less than $10 000 must include details of the process and procedures to be used in entering into the contracts. 5 Policy about internal audit (1) A local government’s policy about internal audit must provide for whether the local government must appoint an internal auditor. (2) If the internal audit policy provides that an internal auditor must be appointed, the internal auditor must perform the following duties— (a) identify and assess the risks to which the local government’s operations are exposed; (b) prepare audit plans to lessen the identified risks; (c) develop a work program for all internal audit activities of the local government; (d) supply a summary of each internal audit report to the mayor, chief executive officer and, if an audit committee has been appointed, the committee; (e) at least twice each financial year—supply a summary of audit findings, action taken and action outstanding to the mayor, chief executive officer and, if an audit committee has been appointed, the committee. (3) An internal auditor may advise the auditor-general about an audit finding.

s 6 11 s 8 Local Government Finance Standard 1994 (4) If a local government’s policy about internal audit does not provide for the appointment of an internal auditor, it must provide for a review of the policy about appointing an internal auditor at least every 3 years. 6 Policy about an audit committee (1) A local government’s policy about an audit committee must provide for whether the local government must establish an audit committee. (2) If the audit committee policy provides that an audit committee must be established, the audit committee must— (a) meet at least twice each financial year; and (b) review internal audit reports and findings; and (c) review audit risk assessments and projects; and (d) review letters and reports provided by an external auditor. (3) If a local government’s audit committee policy does not provide for the establishment of an audit committee, it must provide for a review of the policy about establishing an audit committee at least every 3 years. 7 Policy about borrowings A local government’s policy about borrowings must include— (a) new borrowings planned for the current financial year and the next 2 financial years; and (b) the purpose of the new borrowings; and (c) the time over which it is planned to repay existing and proposed borrowings. 8 Revenue policy A local government’s revenue policy for a financial year must include details of the principles applied by it for the financial year for the following— (a) making and levying rates and charges; (b) exercising its powers to grant rebates and concessions; (c) recovery of unpaid amounts of rates and charges.

s 9 12 s 11 Local Government Finance Standard 1994 Division 2—Principles of financial management 9 Principles to be complied with in financial management The principles to be complied with by a local government in financial management are as follows— (a) the need to consider suitable operation of internal control; (b) the need to consider equity between people presently living in its area and between different generations; (c) the need to consider the interests of all people living in its area; (d) the need to consider the efficient, effective and proper management of the local government; (e) the need to consider planning for the future. Division 3—Accounting manual 10 Local government to keep accounting manual (1) A local government must keep an accounting manual. (2) The manual must contain— (a) all of the local government’s policies about financial management; and (b) the procedures and internal controls associated with the accounting systems; and (c) the duties of staff operating the accounting systems. Division 4—Contracts and tendering 11 Exemptions to requirement to seek tenders or quotations—Act, s 486(1)(e) A contract is made under an exemption to open competition if the contract is entered into— (a) under a standing offer or a preferred supplier arrangement; or

s 12 13 s 14 Local Government Finance Standard 1994 (b) with a supplier from a register of pre-qualified suppliers; or (c) under an LGA arrangement. 12 Preconditions for establishing a standing offer or preferred supplier arrangement A local government may establish a standing offer or preferred supplier arrangement only if— (a) the supply of goods or services is needed in large volumes or frequently; and (b) the local government is able to obtain better value for money by aggregating demand for the goods or services needed; and (c) the goods or services needed can be stated in terms that would be well understood in the industry concerned. 13 Preconditions for establishing a register of pre-qualified suppliers A local government may establish a register of pre-qualified suppliers only if— (a) the preparation and evaluation of invitations each time the goods or services are needed would be costly; or (b) the capability or financial capacity of the supplier is critical; or (c) the goods or services supplied involve significant security considerations; or (d) a precondition of an offer to contract is compliance with defined standards; or (e) the ability of local business to supply the goods or services needed by the local government needs to be ascertained or encouraged. 14 Procedure for establishing purchasing arrangements (1) If a local government proposes to establish a purchasing arrangement, it must invite persons to tender. (2) The invitation must—

s 14A 14 Local Government Finance Standard 1994 s 14A (a) be in the way provided for inviting tenders in section 484 12 of the Act; and (b) state the purchasing arrangement for which the person is tendering. (3) The local government must select persons to enter a purchasing arrangement on the basis of the principles mentioned in section 481 13 of the Act. (4) The local government must ensure there is provision for the evaluation of a purchasing arrangement including, for example, removal of a person from an arrangement because of the person’s poor performance of a contract entered into under the arrangement. (5) A local government may enter a purchasing arrangement for longer than 2 years only if it is satisfied that better value will be achieved by entering into a longer arrangement. Division 5—Notional GST 14A Certificate about payment of notional GST A local government must, no later than 15 September following a financial year, give the Minister a certificate by the chief executive officer and the mayor of the local government stating that the local government has paid notional GST for the financial year. 12 Section 484 (When tenders are required) of the Act 13 Section 481 (Principles governing the making of contracts) of the Act

s 15 15 s 16 Local Government Finance Standard 1994 PART 3—CORPORATE AND OPERATIONAL PLANS Division 1—Corporate plans 15 Requirements of corporate plan—Act, s 507 (1) The purpose of a local government preparing and adopting a corporate plan is to provide an effective way to decide, achieve and review its objectives in the short, medium and long term, through an integrated response to the present and future needs of its community. (2) Without limiting subsection (1), the corporate plan must include— (a) an assessment of local and regional issues, and external and internal factors, affecting its area and its responses to the issues; and (b) a statement of its strategic direction; and (c) a statement of objectives about the issues affecting its area; and (d) strategies for achieving the objectives. 16 Assessment of local and regional issues (1) An assessment of local and regional issues, and the local government’s response to the issues, must include information about its role in— (a) arts and cultural development; and (b) community development and human services; and (c) disaster mitigation; and (d) economic development; and (e) environmental management; and (f) housing policy; and (g) infrastructure development, maintenance and replacement; and (h) population change and development. (2) The assessment must also include consideration of the scope for regional cooperation between local governments to respond to the local and regional issues.

s 17 16 s 18 Local Government Finance Standard 1994 (3) The assessment must not be limited to the time to which the corporate plan relates but must take into account foreseeable future issues relevant to the local government’s area. 17 Consultation process used in preparation of plan A corporate plan must state the consultation process used in its preparation. Example — Note to corporate plan The consultation process for the corporate plan included— (a) notice of a proposal to prepare a draft corporate plan, inviting submissions regarding the preparation of the plan; and (b) consideration of submissions received about the proposal; and (c) preparation of the plan; and (d) notice that the draft plan was available for inspection, inviting submissions regarding the draft plan; and (e) consideration of submissions received about the draft plan; and (f) preparation of the final plan. Division 2—Operational plans 18 Requirements of operational plans—Act, s 510 A local government’s operational plan must— (a) address the methods by which the objectives of its corporate plan are to be achieved; and (b) specify the outcomes it wants to achieve and the internal processes needed to produce the outcomes; and (c) contain performance measures about the outcomes.

s 19 17 s 21 Local Government Finance Standard 1994 PART 4—FUNDS AND ACCOUNTING PROCEDURES Division 1—Operating fund 19 Operating fund A local government’s operating fund consists of all of its assets and liabilities other than trust fund items. 20 Separate bank accounts within operating fund Separate bank accounts may be kept within the operating fund. 21 Reserves—Act, s 515 (1) Reserves may be created by inclusion in a local government’s adopted budget. (2) The resolution adopting a budget creating a reserve must state the reason for the reserve. (3) The resolution, or a policy of the local government, must state whether— (a) cash representing a reserve is to be transferred to a separately identified bank account or other investment; or (b) the assets concerned are to be kept within the local government’s general pool of assets. (4) If a reserve is created, a transfer from the reserve may only be made by resolution of the local government or the inclusion of the transfer in an adopted budget. (5) A resolution authorising a transfer from a reserve for a purpose other than the purpose of the reserve must state the reason for the transfer.

s 22 18 s 27 Local Government Finance Standard 1994 Division 2—Trust fund 22 Trust fund (1) A local government must keep amounts credited to its trust fund in a separate bank account or separately identified investments. (2) The bank account for the trust fund must not be overdrawn. 23 Funds that should not be part of trust fund An amount in a local government’s bank account for its trust fund that is not required to be in the account must be transferred to the operating fund as soon as practicable. 24 Funds incorrectly paid into operating fund If an amount that should be paid into a local government’s bank account for its trust fund is paid into its bank account for its operating fund, the amount must be transferred to the bank account for the trust fund as soon as practicable and, in any case, within 5 working days after it is identified. 25 Reconciliation of trust fund The assets of the trust fund must be reconciled with the liabilities of the trust fund at least monthly. PART 5—BUDGET AND REVENUE STATEMENT 26 Budget to be prepared on an accrual basis A local government’s budget must be prepared on an accrual basis. 27 Requirements of budget—Act, s 519 (1) A local government’s budget for a financial year must show that, for the financial year and the following 2 financial years—

s 28 19 s 28 Local Government Finance Standard 1994 (a) the local government is able to satisfy its liabilities; and (b) the local government’s capital base is not being consumed at a rate which will adversely affect the local government’s service potential; and (c) sufficient funding is available for the local government’s planned asset replacement; and (d) the local government’s planned borrowing is only for— (i) capital expenditure; or (ii) short-term working capital; or (iii) a genuine emergency or hardship; or (iv) establishing a commercial debt structure for its commercial business unit or corporatised corporation; and (e) an amount borrowed for short-term working capital is to be repaid within the financial year in which it is borrowed or the following financial year. (2) In this section— “commercial business unit” , of a local government, see section 578 14 of the Act. “corporatised corporation” , of a local government, see section 592 15 of the Act. 28 Requirements for revenue statement A local government’s revenue statement for a financial year must include the following information for the financial year— (a) an outline and explanation of the revenue raising measures adopted, including, for example, an outline and explanation of— (i) the rates and charges to be made and levied in the financial year; and (ii) the rebates and concessions to be granted in the financial year; 14 Section 578 (Local government to establish commercial business unit) of the Act 15 Section 592 (Definitions for pt 7) of the Act

s 29 20 s 31 Local Government Finance Standard 1994 (b) whether the local government has made a resolution limiting the increases in rates and charges; (c) the extent to which physical and social infrastructure costs for new development are to be funded by charges for the development; (d) whether the operating capability of the local government is to be maintained, increased or decreased and, if it is to be increased or decreased, the extent to which it is to be increased or decreased; (e) whether depreciation and other non-cash expenses are to be fully funded. 16 29 Amendment of budget (1) A local government’s budget must be amended if it intends to make material changes to the expenses or revenue for a significant function or activity. (2) If a local government’s budget is amended after a disbursement is made under section 30, the amendment must take the disbursement into account. 30 Disbursement because of genuine emergency or hardship—Act, s 519(4) (1) A resolution must be made about a disbursement for a purpose of a genuine emergency or hardship before the disbursement is made or as soon as practicable after it is made. (2) The resolution must state how the disbursement is to be funded. 31 Financial information to be presented to budget meeting—Act, s 521 (1) A document presented to a budget meeting under section 521 of the Act must include the following— (a) the original budget estimates; 16 See sections 518 (Adoption of budget and revenue statement) and 520A (Requirements and content of revenue statement) of the Act.

s 33 21 s 35 Local Government Finance Standard 1994 (b) if an amended budget has been adopted—the amended budget estimates; (c) actual or estimated expenses and revenue; (d) explanations of significant differences from the original budget (whether an actual or anticipated difference); (e) an explanation of the impact of the budget and actual performance on future budgets. (2) The document must be prepared on an accrual basis. PART 6—ACCOUNTS Division 1—Accounting records 33 Systems to support account keeping (1) All revenue, expenses, assets, liabilities and equity of a local government must be identified, recorded and controlled in its accounting records. (2) Without limiting subsection (1), the local government must have systems in place to ensure— (a) all revenue is promptly assessed and collected; and (b) expenses and liabilities are not incurred without appropriate authority; and (c) assets are protected from loss. Division 2—Non-current assets 35 Register of non-current assets (1) A local government must keep a register of non-current assets. (2) The register of non-current assets must include all of its non-current assets, other than a non-current asset it is treating as an expense.

s 36 22 s 36 Local Government Finance Standard 1994 (3) The local government must, by resolution, set an amount (the “ set amount” ) below which the value of a non-current asset must be treated as an expense. (4) The set amount must not be more than $5 000. (5) The set amount may be a different amount for different assets. (6) The set amount must be recorded in the local government’s accounting manual and disclosed by way of note in its annual financial statements. (7) The local government must keep documents and records supporting the register of non-current assets. Division 3—Non-current asset valuation 36 Value of non-current assets (1) Non-current assets must be valued by using the fair value basis. (2) However, a local government may value a non-current asset by using the cost basis if the asset has— (a) a useful life from new of not more than 10 years; or (b) a carrying value of not more than $50 000 or, if a lesser amount is decided by the local government, the lesser amount. (3) A local government must keep a record of a valuation made under subsection (1) or (2). (4) In this section— “carrying value” , for an asset, means— (a) the value of the asset as recorded in the local government’s financial statements for the previous financial year; or (b) if the asset was purchased in the current financial year—the cost of the asset. “cost basis” means the cost basis within the meaning of Accounting Standard AASB 1041. 17 17 Accounting Standard AASB 1041 (Revaluation of Non-current Assets) issued by the Australian Accounting Standard Board. The Accounting Standard can be accessed on the internet at www.aasb.com.au.

s 39 23 s 44 Local Government Finance Standard 1994 “fair value basis” means the fair value basis within the meaning of Accounting Standard AASB 1041. 39 Certain land and roads do not have a value For a local government’s financial statements, the following do not have a value— (a) land that is a reserve under the Land Act 1994 and is controlled by the local government; (b) a road controlled by the local government (other than a road owned by it). PART 7—ANNUAL REPORT Division 1—Annual reports generally 44 Annual report (1) A local government’s annual report must include— (a) a summary of its policy about borrowings; and (b) a community financial report. (2) The community financial report must be— (a) consistent with, but not part of, the local government’s financial statements; and (b) in a form that is readily understood by the community. (3) However, a local government is not required to include a community financial report in its annual report for the financial year beginning 1 July 2001. (4) In this section— “community financial report” means a report containing a summary and analysis of the local government’s financial performance and position for the financial year.

s 45 24 s 46 Local Government Finance Standard 1994 45 Note about reserves and roads controlled by local governments (1) A local government’s annual report must include a note about— (a) land that is a reserve under the Land Act 1994 and is controlled by the local government; and (b) roads controlled by the local government (other than roads owned by it). (2) A note about a reserve must state the area of the reserve controlled by the local government, including land that has been leased by it to someone else. (3) A note about roads must state the total length of roads controlled by the local government. Example of a note — The Council of the Shire of the Tropical State has control of— (a) 100 ha of parks (including 10 ha leased to sporting clubs) on land that is a reserve under the Land Act 1994 ; and (b) 700 km of roads. This land does not have a value for its financial statements. Division 2—Financial statements in annual report 46 Annual financial statements—Act, s 532 (1) A local government’s financial statements for the year are to be general purpose financial statements and must comply with the following— (a) applicable abstracts of the Urgent Issues Group; (b) applicable accounting standards; (c) statements of accounting concepts. (2) Subsection (1) applies to the extent the items mentioned in paragraphs (a) to (c) are consistent with this standard.

s 47 25 s 53 Local Government Finance Standard 1994 47 Period to which statements relate (1) Financial statements of a local government prepared up to a day within 2 weeks before 30 June of a financial year are taken to be prepared for the whole of the financial year. (2) The financial statements must show— (a) the date to which the statements are prepared; and (b) in the title of the statements—the period for which the statements are prepared. 48 Financial statements to include statement for significant business activities (1) A local government’s financial statements must include a statement for each of its significant business activities. (2) The statement must— (a) show the revenues for the activity; and (b) show the expenses for the activity including any items required to be taken into account for full cost pricing, other than return on capital; and (c) include a description of the nature of community service obligations provided under the activity. (3) The statement must disclose, as revenues, the following items separately— (a) revenue for goods and services provided to clients other than the local government in carrying on the activity; (b) revenue for goods and services provided to the local government in carrying on the activity; (c) the cost of providing the community service obligations, less any revenue arising from providing them. 53 Signing of financial statements—Act, s 532 (1) The proposed financial statements must be given to the auditor-general as soon as practicable after the close of each financial year but, in any case, no later than 15 September.

s 54 26 s 57 Local Government Finance Standard 1994 (2) The Minister may extend the time for complying with subsection (1) by written notice given to the local government. (3) As soon as practicable after the proposed financial statements are given to the auditor-general, the proposed financial statements must be presented to a meeting of the local government. 54 Certificate for proposed financial statements The proposed financial statements must include a certificate by the chief executive officer and mayor of the local government stating whether in their opinion— (a) the requirements under the Act for the keeping of accounts have been complied with in all material respects; and (b) the statements for the financial year, and supporting notes, present the local government’s operating results, cash flows and financial position as required by the Act. 55 Certificate for final financial statements Final financial statements, given to the auditor-general for certification, must include a fresh certificate by the chief executive officer and mayor of the local government stating whether in their opinion— (a) the requirements under the Act for the keeping of accounts have been complied with in all material respects; and (b) the statements for the financial year, and supporting notes, present the local government’s operating results, cash flows and financial position as required by the Act. 56 Differences between proposed and final financial statements If the final financial statements are different from the proposed financial statements, they must be presented to the local government with a statement of any significant differences. 57 Unaudited financial statements (1) If the financial statements have not been certified by the auditor-general, a copy that is given to the local government or anyone else must be clearly marked ‘UNAUDITED’ on every page.

s 58 27 s 60 Local Government Finance Standard 1994 (2) Subsection (1) does not apply to a copy of the financial statements given to the auditor-general. PART 8—FULL COST PRICING Division 1—Preliminary 58 Object of pt 8 The object of this part is to state requirements for full cost pricing for chapter 8, part 5 of the Act. 59 Application of pt 8 This part applies to a local government’s implementation of full cost pricing for its significant business activities under chapter 8, part 5 of the Act. Division 2—Full cost pricing Subdivision 1—Matters affecting full cost pricing 60 Matters affecting full cost pricing The matters affecting full cost pricing are— (a) full cost pricing; and (b) treatment of community service obligations; and (c) elimination, or taking account, of advantages and disadvantages of public ownership; and (d) financial reporting.

s 61 28 s 63 Local Government Finance Standard 1994 Subdivision 2—Full cost pricing 61 Application of full cost pricing In deciding charges to clients for goods and services provided in carrying on an activity, a local government must ensure the projected total revenue from carrying on the activity is enough to cover the projected total costs of carrying on the activity for the local government’s financial year. 62 Different charges for commercial reasons (1) A charge may be decided for the provision of specific goods or services in carrying on an activity that is, for commercial reasons, an appropriate charge for the goods or services provided. (2) For subsection (1), a charge is, for commercial reasons, an appropriate charge if it is a charge that could reasonably be charged if the goods or services had been provided by an entity carrying on the activity with the primary object of making a profit from carrying on the activity. 63 Total costs of carrying on activity (1) For this subdivision, the total costs of carrying on an activity include the following— (a) operational costs incurred in carrying on the activity; (b) administrative and overhead costs; (c) cost of resources used in carrying on the activity; (d) depreciation; (e) equivalents for Commonwealth or State taxes the local government is not liable to pay because it is a local government; (f) equivalents for the cost of funds advantage the local government obtains over commercial rates of interest because of State guarantees on borrowings; 18 (g) return on capital. 18 See section 569 (Guarantees by State) of the Act.

s 64 29 s 66 Local Government Finance Standard 1994 (2) The total costs must be adjusted for other advantages and disadvantages of public ownership that are not eliminated. 19 64 Administrative and overhead costs The local government must make a reasonable allocation of its administrative and overhead costs to each activity to which full cost pricing is applied. 65 Cost of resources used in carrying on activity (1) If resources are provided by or to a local government for carrying on an activity, the cost of resources used in carrying on the activity includes an equivalent cost. (2) If the resources have an identifiable cost, the cost of the resources may be taken to be the equivalent cost. (3) If subsection (2) does not apply and the resources are readily available on the open market, the price at which they can be obtained in the market may be taken to be the equivalent cost. (4) If subsection (3) is applied, the local government must ensure the terms on which the cost is based are similar to the terms on which they are made available in carrying on the activity. 66 Depreciation (1) Depreciation of an asset used in carrying on an activity must be determined under the accounting standards. (2) However, a local government may— (a) decide not to determine the depreciation of an asset under the accounting standards; and (b) adopt, as the depreciation of the asset, an amount decided by the local government to be appropriate in the circumstances. 19 See section 568(2) (Meaning of “full cost pricing”) of the Act.

s 67 30 s 68 Local Government Finance Standard 1994 67 Equivalents for taxes not otherwise liable to be paid (1) If, for an activity, the local government would be liable for a Commonwealth or State tax if it were not carried on by a local government, the amount equivalent to the tax must be included in the total costs of the activity. (2) In working out the equivalent amounts, the local government must, if appropriate, apply the general principles of the tax equivalents manual issued under section 582 20 of the Act that apply to activities carried on by commercial business units. (3) Subsection (2) does not, of itself, require compliance with any processes or other requirements under the manual but the local government must keep details of calculations done in working out the equivalent amounts for 7 years. (4) For a tax not dealt with in the manual, estimates of amounts that a private sector entity carrying on the business would calculate to be its liability to the tax must be included. 68 Return on capital (1) The amount for the return on the capital used in carrying on an activity must be decided using the rate at which, in the opinion of the local government, a comparable private sector entity carrying on the activity would be able to obtain the capital in the market, having regard to the split the local government considers appropriate, for the type of business, between equity and loan capital and the return appropriate to each. (2) Despite subsection (1), the amount for the return on the capital used in carrying on an activity for the first year in which full cost pricing applies to the activity may be the amount the local government decides. (3) In this section— “capital used in carrying on an activity” means the total value (using an accepted accountancy method) of the assets used for the activity less the liabilities attributable to the activity. 20 Section 582 (Commonwealth and State tax equivalents) of the Act

s 69 31 s 72 Local Government Finance Standard 1994 Subdivision 3—Treatment of community service obligations 69 Extra cost for community service obligations to be treated as revenue If community service obligations are carried out as part of an activity, for deciding charges for goods and services provided through the activity, there must be treated as revenue for the activity an amount equivalent to— (a) the cost of carrying out the obligations; less (b) any revenue arising from carrying out the obligations. PART 9—COMMERCIALISATION Division 1—Preliminary 70 Object of pt 9 The object of this part is to state requirements for commercialisation for chapter 8, part 6 of the Act. 71 Application of pt 9 This part applies to a local government’s implementation of commercialisation for its significant business activities under chapter 8, part 6 of the Act. Division 2—Commercialisation Subdivision 1—Matters affecting commercialisation 72 Matters affecting commercialisation The matters affecting commercialisation are— (a) full cost pricing; and

s 73 32 s 75 Local Government Finance Standard 1994 (b) treatment of community service obligations; and (c) elimination, or taking account, of advantages and disadvantages of public ownership; and (d) matters mentioned in the local government’s annual performance plan. Subdivision 2—Full cost pricing 73 Application of full cost pricing In deciding charges to clients for goods and services provided in carrying on an activity, a local government must ensure the projected total revenue from carrying on the activity is enough to cover the projected total costs of carrying on the activity for the local government’s financial year. 74 Different charges for commercial reasons (1) A charge may be decided for the provision of specific goods or services in carrying on an activity that is, for commercial reasons, an appropriate charge for the goods or services provided. (2) For subsection (1), a charge is, for commercial reasons, an appropriate charge if it is a charge that could reasonably be charged if the goods or services had been provided by an entity carrying on the activity with the primary object of making a profit from carrying on the activity. 75 Total costs of carrying on activity For this subdivision, the total costs of carrying on an activity include the following— (a) operational costs incurred in carrying on the activity; (b) administrative and overhead costs; (c) cost of resources used in carrying on the activity; (d) depreciation;

s 76 33 s 78 Local Government Finance Standard 1994 (e) equivalents for Commonwealth or State taxes the local government is not liable to pay because it is a local government; 21 (f) equivalents for the cost of funds advantage the local government obtains over commercial rates of interest because of State guarantees on borrowings; 22 (g) return on capital. 76 Administrative and overhead costs The local government must make a reasonable allocation of its administrative and overhead costs to each activity to which commercialisation is applied. 77 Cost of resources used in carrying on activity (1) If resources are provided by or to a local government for carrying on an activity, the cost of resources used in carrying on the activity includes an equivalent cost. (2) If the resources have an identifiable cost, the cost of the resources may be taken to be the equivalent cost. (3) If subsection (2) does not apply and the resources are readily available on the open market, the price at which they can be obtained in the market may be taken to be the equivalent cost. (4) If subsection (3) is applied, the local government must ensure the terms on which the cost is based are similar to the terms on which they are made available in carrying on the activity. 78 Depreciation (1) Depreciation of an asset used in carrying on an activity must be determined under the accounting standards. (2) However, a local government may— 21 See section 582 (Commonwealth and State tax equivalents) of the Act. 22 See section 583 (Guarantees by State) of the Act.

s 79 34 s 80 Local Government Finance Standard 1994 (a) decide not to determine the depreciation of an asset under the accounting standards; and (b) adopt, as the depreciation of the asset, an amount decided by the local government to be appropriate in the circumstances. 79 Return on capital (1) The amount for the return on the capital used in carrying on an activity must be decided using the rate at which, in the opinion of the local government, a comparable private sector entity carrying on the activity would be able to obtain the capital in the market, having regard to the split the local government considers appropriate, for the type of business, between equity and loan capital and the return appropriate to each. (2) Despite subsection (1), the amount for the return on the capital used in carrying on an activity for the first year in which commercialisation applies to the activity may be the amount the local government decides. (3) In this section— “capital used in carrying on an activity” means the total value (using an accepted accountancy method) of the assets used for the activity less the liabilities attributable to the activity. Subdivision 3—Treatment of community service obligations 80 Extra cost for community service obligations to be treated as revenue If community service obligations are carried out as part of an activity, for deciding charges for goods and services provided through the activity, there must be treated as revenue for the activity an amount equivalent to— (a) the cost of carrying out the obligations; less (b) any revenue arising from carrying out the obligations.

s 81 35 s 81 Local Government Finance Standard 1994 Subdivision 4—Annual performance plan 81 Annual performance plan for each commercial business unit (1) The annual performance plan for a commercial business unit (a “CBU” ) must include the following matters— (a) the CBU’s financial and non-financial performance targets for its activities; (b) the nature and extent of the CBU’s community service obligations; (c) the costings of, and funding for, the CBU’s community service obligations. (2) A CBU’s annual performance plan must also include the following matters— (a) the CBU’s objectives and functions; (b) the nature and scope of the CBU’s main activities and undertakings; (c) the CBU’s notional capital structure and treatment of surpluses; (d) the CBU’s proposed major investments; (e) the CBU’s outstanding and proposed borrowings; (f) the CBU’s policy on the level and quality of service consumers can expect from the CBU; (g) the delegations necessary to allow the CBU to exercise management autonomy and authority in its commercial activities; (h) the type of information to be given in reports. (3) However, a CBU is not required to include in its annual performance plan a matter, or an aspect of a matter, mentioned in subsection (2) if the CBU’s local government is satisfied that the matter or aspect is not materially relevant to the CBU or its activities. (4) Subsections (1) and (2) do not limit the matters that may be included in an annual performance plan. (5) A matter in the annual performance plan of a CBU may be omitted from the copies of the plan to be made public if—

s 82 36 s 83 Local Government Finance Standard 1994 (a) the matter is of a commercially sensitive nature to the CBU; and (b) a full statement of the matter is given to each councillor of the local government. 23 PART 10—CODE OF COMPETITIVE CONDUCT Division 1—Preliminary 82 Object of pt 10 The object of this part is to prescribe the code of competitive conduct for chapter 9 of the Act. 83 Application of code This code applies to an activity of a local government— (a) if it is a roads business activity—from when it is to apply under section 763 24 of the Act; or (b) if it is a business activity to which the local government has resolved to apply the code—while the resolution is effective under section 766 25 of the Act; or (c) if it is another activity to which the local government applies the code 26 —in accordance with the local government’s decision to apply the code. 23 Under s 250(2) of the Act, a person who is or has been a local government councillor must not release information that the person knows, or should reasonably know, is confidential to the local government and the local government wishes to keep confidential. 24 Section 763 (Code must be applied to roads business activities) of the Act 25 Section 766 (Local government to resolve whether to apply code of competitive conduct to business activities) of the Act 26 Under section 767 of the Act, a local government is not prevented from applying the code to other activities.

s 84 37 s 87 Local Government Finance Standard 1994 Division 2—The code Subdivision 1—Elements of the code 84 Elements of the code The elements of the code are— (a) full cost pricing; and (b) treatment of community service obligations; and (c) elimination, or taking account, of advantages and disadvantages of public ownership; and (d) financial reporting. Subdivision 2—Full cost pricing 85 Application of full cost pricing In deciding charges to clients for goods and services provided in carrying on an activity, a local government must ensure the projected total revenue from carrying on the activity is enough to cover the projected total costs of carrying on the activity for the local government’s financial year or a longer period (not more than 5 years) decided by the local government. 86 Different charges for commercial reasons (1) A charge may be decided for the provision of specific goods or services in carrying on an activity that is, for commercial reasons, an appropriate charge for the goods or services provided. (2) For subsection (1), a charge is, for commercial reasons, an appropriate charge if it is a charge that could reasonably be charged if the goods or services had been provided by an entity carrying on the activity with the primary object of making a profit from carrying on the activity. 87 Total costs of carrying on activity (1) For this subdivision, the total costs of carrying on an activity include the following—

s 88 38 s 90 Local Government Finance Standard 1994 (a) operational costs incurred in carrying on the activity; (b) administrative and overhead costs; (c) cost of resources used in carrying on the activity; (d) depreciation; (e) equivalents for Commonwealth or State taxes the local government is not liable to pay because it is a local government; (f) equivalents for the cost of funds advantage the local government obtains over commercial rates of interest because of State guarantees on borrowings; (g) return on capital. (2) The total costs must be adjusted for other advantages and disadvantages of public ownership that are not eliminated. 88 Administrative and overhead costs The local government must make a reasonable allocation of its administrative and overhead costs to each activity to which the code applies. 89 Cost of resources used in carrying on activity (1) If resources are provided by or to a local government for carrying on an activity, the cost of resources used in carrying on the activity includes an equivalent cost. (2) If the resources have an identifiable cost, the cost of the resources may be taken to be the equivalent cost. (3) If subsection (2) does not apply and the resources are readily available on the open market, the price at which they can be obtained in the market may be taken to be the equivalent cost. (4) If subsection (3) is applied, the local government must ensure the terms on which the cost is based are similar to the terms on which they are made available in carrying on the activity. 90 Depreciation (1) Depreciation of an asset used in carrying on an activity must be determined under the accounting standards.

s 91 39 s 93 Local Government Finance Standard 1994 (2) However, a local government may— (a) decide not to determine the depreciation of an asset under the accounting standards; and (b) adopt, as the depreciation of the asset, an amount decided by the local government to be appropriate in the circumstances. 91 Equivalents for taxes not otherwise liable to be paid (1) If, for an activity, the local government would be liable for a Commonwealth or State tax if it were not carried on by a local government, the amount equivalent to the tax must be included in the total costs of the activity. (2) In working out the equivalent amounts, the local government must, if appropriate, apply the general principles of the tax equivalents manual issued under section 582 27 of the Act that apply to activities carried on by commercial business units. (3) Subsection (2) does not, of itself, require compliance with any processes or other requirements under the manual but the local government must keep details of calculations done in working out the equivalent amounts for 7 years. (4) For a tax not dealt with in the manual, estimates of amounts that a private sector entity carrying on the business would calculate to be its liability to the tax must be included. 92 Equivalents for State guarantees on borrowings If the State guarantees repayment of a debt of a local government attributed to an activity, the local government must in carrying on the activity take account of amounts equivalent to the cost of funds advantage the local government obtains over commercial rates of interest because of the guarantee. 93 Return on capital (1) The amount for the return on the capital used in carrying on an activity must be decided using the rate at which, in the opinion of the local 27 Section 582 (Commonwealth and State tax equivalents) of the Act

s 94 40 s 96 Local Government Finance Standard 1994 government, a comparable private sector entity carrying on the activity would be able to obtain the capital in the market, having regard to the split the local government considers appropriate for the type of business between equity and loan capital and the return appropriate to each. (2) Despite subsection (1), the amount for the return on the capital used in carrying on an activity for the first year in which the code applies to the activity may be the amount the local government decides. (3) In this section— “capital used in carrying on an activity” means the total value (using an accepted accounting method) of the assets used for the activity less the liabilities attributable to the activity. Subdivision 3—Treatment of community service obligations 94 Extra cost for community service obligations to be treated as revenue If community service obligations are carried out as part of an activity, for deciding charges for goods and services provided through the activity, there must be treated as revenue for the activity an amount equivalent to— (a) the cost of carrying out the obligations; less (b) any revenue arising from carrying out the obligations. 95 Community service obligations not to be part of roads business activities Community service obligations must not be included in offers or competitive tenders submitted for roads business activities carrying out work on State-controlled roads. Subdivision 4—Elimination of, or taking into account, advantages and disadvantages of public ownership 96 Effect of advantages or disadvantages of public ownership The local government must ensure—

s 97 41 s 97 Local Government Finance Standard 1994 (a) if possible and appropriate, any advantages or disadvantages arising because an activity is publicly owned are eliminated; and (b) if the advantages or disadvantages are not eliminated—they are taken into account in deciding full cost pricing for the activity. Subdivision 5—Financial reporting 97 Statement in budget (1) Each budget of a local government must include a statement about its activities to which the code applies. (2) The statement must— (a) show the estimated revenues for each activity; and (b) show the estimated expenses for each activity including any items required to be taken into account for full cost pricing other than return on capital; and (c) include the estimated surplus or deficit for the period; and (d) include a description of the nature of community service obligations to be provided under the activity. (3) The statement must disclose, as estimated revenues, the following items separately— (a) estimated revenue for services to be provided by the activity to clients other than the local government; (b) estimated revenue for services to be provided by the activity to the local government; (c) the estimated cost of, less any estimated revenue arising from, carrying out community service obligations provided under the activity. (4) A separate statement under this section is not required if— (a) the activity, or the total for all activities, is a significant activity for accounting purposes; and (b) all the required information is shown in the budget.

s 98 42 s 99 Local Government Finance Standard 1994 98 Omission of certain matters from statement in budget A statement in a budget of a local government under section 97 may include a summary of a matter required to be included in the budget, rather than a full statement of the matter, if— (a) the summary indicates— (i) it is a summary only; and (ii) a full statement of the matter is open to inspection; and (b) a full statement of the matter is open to inspection. 99 Statement in annual report (1) A local government must include in the financial statements in its annual report a statement for each of its activities to which the code applies. (2) The statement must— (a) show the revenues for the activity; and (b) show the expenses for the activity including any items required to be taken into account for full cost pricing other than return on capital; and (c) include a description of the nature of community service obligations provided under the activity. (3) The statement must disclose, as revenues, the following items separately— (a) revenue for goods and services provided to clients other than the local government in carrying on the activity; (b) revenue for goods and services provided to the local government in carrying on the activity; (c) the cost of, less any revenue arising from, carrying out community service obligations provided under the activity. (4) Subsection (1) does not apply to a local government’s significant business activities.

s 100 43 Local Government Finance Standard 1994 s 101 100 Omission of certain matters from statement in annual report A statement in an annual report of a local government under section 99 may include a summary of a matter required to be included in the annual report, rather than a full statement of the matter, if— (a) the summary indicates— (i) it is a summary only; and (ii) a full statement of the matter is open to inspection; and (b) a full statement of the matter is open to inspection. PART 11—REFORM OF CERTAIN WATER AND SEWERAGE SERVICES Division 1—Preliminary 101 Object of pt 11 The object of this part is to state the requirements for the reform of certain water and sewerage services under chapter 10 of the Act for relevant business activities of local governments and their corporatised corporations.

s 102 44 Local Government Finance Standard 1994 s 103 Division 2—Matters to be complied with Subdivision 1—Matters to be complied with for relevant business activities 102 Matters to be complied with for relevant business activities In complying with section 783 28 of the Act in relation to its relevant business activities, a local government or corporatised corporation (the “entity” ) must comply with the following matters in this division— (a) if the local government has resolved that a two-part tariff is to be applied for an activity—a two-part tariff; (b) consumption as the basis for utility charges for water services; (c) full cost recovery for water and sewerage services; (d) identification and disclosure of cross-subsidies between classes of consumers; (e) identification and disclosure of community service obligations; (f) disclosure of the classes of consumers provided with water and sewerage services at an amount below full cost and the amount. Subdivision 2—Two-part tariffs 103 Utility charges if two-part tariffs applied If a local government decides under chapter 14, part 4 of the Act to apply a two-part tariff for a relevant business activity that provides water services, the utility charges for water services must be based on an amount or amounts for units or part of a unit of the quantity of water supplied, but may include an access amount. 29 28 Section 783 (Local governments to implement charging and operational arrangements for relevant business activities) of the Act 29 The basis of this calculation reflects section 106(2)(b) and (5).

s 104 45 Local Government Finance Standard 1994 s 106 Subdivision 3—Consumption as the basis for utility charges for water services 104 Application of sdiv 3 This subdivision applies to the extent that an entity’s relevant business activity provides water services. 105 Consumption as the basis for utility charges In deciding the utility charges to be made for the supply of water services provided by a relevant business activity, an entity must ensure the charges are based on the quantity of water supplied. 106 When charges are based on quantity of water supplied (1) A utility charge for water services is based on the quantity of water supplied by the entity if it is worked out on a basis stated in subsection (2), (3) or (4). (2) If utility charges are worked out based on meter readings of water consumed, the utility charges for consumers or groups of consumers must be based on either— (a) a fixed amount and a further amount or further amounts for each unit or part of a unit of the quantity of water supplied greater than a stated unit or units; or (b) an amount or amounts for units or part of a unit of the quantity of water supplied. (3) The utility charge for consumers in a group must be based on the estimated average consumption by all consumers in the group if— (a) utility charges are not based on a meter reading of water consumed; and (b) the consumers are divided by the entity into groups based on the estimated average quantity of water expected to be supplied to customers in each group. Example for subsection (3) — A local government could, by sampling or other ways, work out the average usage of domestic consumers was 300 kl per year and the average of commercial consumers was 2 000 kl per year. The utility charge could then be based on a notional access charge of

s 107 46 Local Government Finance Standard 1994 s 109 say, for domestic consumers—$100 and, for commercial consumers—$600 and a notional usage charge of $1 a kl. The charges would be $400 for domestic consumers and $2 600 for commercial consumers. Given the considerable variability of consumption across commercial consumers, it would be preferable to further divide them by type and carry out separate assessments for each. Some of the commercial users may be metered and charged on the basis of actual consumption in which case subsection (3) would not apply to them. (4) If a utility charge for water services is not made under subsection (2) or (3), the charge must be worked out on a basis the entity considers appropriate to determine the reasonably likely consumption by the consumer. (5) Subsections (2) to (4) do not prevent a utility charge for supply of water services including an access amount. Subdivision 4—Full cost recovery 107 Application of sdiv 4 This subdivision does not apply to an entity deciding the charges for water and sewerage services provided to clients in carrying on a relevant business activity if the entity applies full cost pricing under part 8 or 9 in deciding the charges. 108 Application of full cost recovery In deciding the charges for water and sewerage services provided to clients in carrying on a relevant business activity, an entity must ensure the projected total revenue from carrying on the activity is enough to cover the projected total costs of carrying on the activity for a financial year. 109 Total costs of carrying on relevant business activity For this subdivision, the total costs of carrying on a relevant business activity include the following— (a) operational costs incurred in carrying on the activity; (b) administrative and overhead costs; (c) cost of resources used in carrying on the activity;

s 110 47 Local Government Finance Standard 1994 s 113 (d) depreciation; (e) return on capital employed. 110 Administrative and overhead costs The entity must make a reasonable allocation of its administrative and overhead costs to each relevant business activity to which full cost recovery is applied. 111 Cost of resources used in carrying on relevant business activity (1) If resources are provided by or to an entity for carrying on a relevant business activity, the cost of resources used in carrying on the activity includes an equivalent cost. (2) If the resources have an identifiable cost, the cost of the resources may be taken to be the equivalent cost. (3) If subsection (2) does not apply and the resources are readily available on the open market, the price at which they can be obtained in the market may be taken to be the equivalent cost. (4) If subsection (3) is applied, the entity must ensure the terms on which the cost is based are similar to the terms on which they are made available in carrying on the activity. 112 Depreciation (1) Depreciation of an asset used in carrying on an activity must be determined under the accounting standards. (2) However, a local government may— (a) decide not to determine the depreciation of an asset under the accounting standards; and (b) adopt, as the depreciation of the asset, an amount decided by the local government to be appropriate in the circumstances. 113 Return on capital (1) The amount for the return on the capital used in carrying on a relevant business activity must be a positive real rate decided by the entity.

s 114 48 Local Government Finance Standard 1994 s 116 (2) In this section— “capital used in carrying on a relevant business activity” means the total value (using an accepted accounting method) of the assets used for the activity less the liabilities attributable to the activity. Subdivision 5—Treatment of community service obligations 114 Extra cost for community service obligations to be treated as revenue If community service obligations are carried out as part of a relevant business activity, for deciding charges for goods and services provided through the activity, there must be treated as revenue for the activity an amount equivalent to— (a) the cost of carrying out the obligations; less (b) any revenue arising from carrying out the obligations. Subdivision 6—Identification and disclosure of cross-subsidies between classes of consumers 115 Disclosure of cross-subsidies in annual report In its annual report, an entity must state the amount of cross-subsidies between the following classes of consumers, for water or sewerage services provided for the financial year— (a) domestic consumers; (b) commercial consumers; (c) industrial consumers; (d) another class decided by the entity; (e) other consumers. 116 Identification and disclosure of cross-subsidies (1) For deciding the amount to be stated for section 115, the entity must, to the extent it is reasonably practicable, comply with the guidelines.

s 117 49 Local Government Finance Standard 1994 s 117 (2) In this section— “guidelines” means the document called ‘Guidelines for Identification and Measurement of Cross-Subsidies’ issued by the Department of Natural Resources. 30 Subdivision 7—Disclosure of community service obligations 117 Disclosure of community service obligations An entity must state in its annual report— (a) community service obligations carried out during the financial year as part of a relevant business activity; and (b) the cost of, less any revenue arising from, carrying out the obligations. 30 A copy of the Guidelines for Identification and Measurement of Cross-Subsidies may be inspected at the office of the Department of Local Government and Planning at 111 George Street, Brisbane.

50 Local Government Finance Standard 1994 ENDNOTES 1 Index to endnotes Page 2 Date to which amendments incorporated . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .50 3 Key . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 4 Table of reprints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .51 5 Tables in earlier reprints . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 6 List of legislation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .52 7 List of annotations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .53 8 Table of renumbered provisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61 2 Date to which amendments incorporated This is the reprint date mentioned in the Reprints Act 1992, section 5(c). Accordingly, this reprint includes all amendments that commenced operation on or before 1 July 2003. Future amendments of the Local Government Finance Standard 1994 may be made in accordance with this reprint under the Reprints Act 1992, section 49.

51 Local Government Finance Standard 1994 3 Key Key to abbreviations in list of legislation and annotations Key AIA amd amdt ch def div exp gaz hdg ins lap notfd o in c om orig p para prec pres prev Explanation = Acts Interpretation Act 1954 = amended = amendment = chapter = definition = division = expires/expired = gazette = heading = inserted = lapsed = notified = order in council = omitted = original = page = paragraph = preceding = present = previous Key (prev) proc prov pt pubd R[X] RA reloc renum rep (retro) rv s sch sdiv SIA SIR SL sub unnum Explanation = previously = proclamation = provision = part = published = Reprint No.[X] = Reprints Act 1992 = relocated = renumbered = repealed = retrospectively = revised edition = section = schedule = subdivision = Statutory Instruments Act 1992 = Statutory Instruments Regulation 2002 = subordinate legislation = substituted = unnumbered 4 Table of reprints Reprints are issued for both future and past effective dates. For the most up-to-date table of reprints, see the reprint with the latest effective date. If a reprint number includes a letter of the alphabet, the reprint was released in unauthorised, electronic form only. TABLE OF REPRINTS Reprint No. 1 1A 1B 2 2A 2B 2C 2D Amendments included to 1994 SL No. 481 to 1997 SL No. 360 to 1998 SL No. 142 to 1998 SL No. 276 to 1999 SL No. 149 to 2001 SL No. 161 to 2001 SL No. 253 to 2002 SL No. 91 2E to 2003 SL No. 40 2F to 2003 SL No. 40 3 to 2003 SL No. 40 Effective 16 December 1994 24 October 1997 15 May 1998 9 October 1998 1 July 1999 7 September 2001 7 December 2001 26 April 2002 14 March 2003 1 July 2003 1 July 2003 Reprint date 27 January 1995 12 November 1997 14 July 1998 30 October 1998 19 July 1999 10 September 2001 21 December 2001 8 May 2002 (Column discontinued) Notes R2F withdrawn, see R3

52 Local Government Finance Standard 1994 5 Tables in earlier reprints TABLES IN EARLIER REPRINTS Name of table Corrected minor errors Renumbered provisions Reprint No. 2 2 6 List of legislation Local Government Finance Standard 1994 SL No. 217 made by the Governor in Council on 22 June 1994 notfd gaz 24 June 1994 pp 1058–61 commenced on date of notification exp 1 September 2004 (see SIA s 54) amending legislation— Local Government Finance Amendment Standard (No. 1) 1994 SL No. 481 notfd gaz 16 December 1994 pp 1792–7 commenced on date of notification Local Government Finance Amendment Standard (No. 1) 1996 SL No. 20 notfd gaz 2 February 1996 pp 488–90 commenced on date of notification Local Government Finance Amendment Standard (No. 1) 1997 SL No. 79 notfd gaz 27 March 1997 pp 1333–6 commenced on date of notification Local Government Finance Amendment Standard (No. 2) 1997 SL No. 360 notfd gaz 24 October 1997 pp 786–8 commenced 24 October 1997 (see s 2 and 1997 SL No. 358) Local Government Finance Amendment Standard (No. 1) 1998 SL No. 142 notfd gaz 15 May 1998 pp 311–16 commenced on date of notification Local Government Finance Amendment Standard (No. 2) 1998 SL No. 276 notfd gaz 9 October 1998 pp 489–91 s 17 commenced 1 July 1997 (see s 2) remaining provisions commenced on date of notification Local Government Finance Amendment Standard (No. 1) 1999 SL No. 114 notfd gaz 18 June 1999 pp 791–2 ss 1–2 commenced on date of notification remaining provisions commenced 30 June 1999 (see s 2)

53 Local Government Finance Standard 1994 Local Government Finance Amendment Standard (No. 2) 1999 SL No. 149 notfd gaz 25 June 1999 pp 932–8 ss 1–2 commenced on date of notification remaining provisions commenced 1 July 1999 (see s 2(1) and proc pubd Cwlth of Australia gaz 29 June 1999, No. S283) Local Government Finance Amendment Standard (No. 1) 2001 SL No. 161 notfd gaz 7 September 2001 pp 62–3 commenced on date of notification Local Government Finance Amendment Standard (No. 2) 2001 SL No. 253 notfd gaz 7 December 2001 pp 1270–1 commenced on date of notification Local Government Finance Amendment Standard (No. 1) 2002 SL No. 91 notfd gaz 26 April 2002 pp 1540–3 commenced on date of notification Local Government Finance Amendment Standard (No. 1) 2003 SL No. 40 notfd gaz 14 March 2003 pp 979–80 ss 1–2 commenced on date of notification pt 3 commenced 1 July 2003 (see s 2) remaining provisions commenced on date of notification 7 List of annotations This reprint has been renumbered—see table of renumbered provisions in endnote 8. Definitions s 2 def “AAS” om 2002 SL No. 91 s 3(1) def “abstracts of the Urgent Issues Group” ins 2002 SL No. 91 s 3(2) def “accounting standards” ins 2002 SL No. 91 s 3(2) def “Australian Accounting Standards” om 2002 SL No. 91 s 3(1) def “bank account” amd 1999 SL No. 149 s 4(1) def “commercialisation” ins 1998 SL No. 142 s 3 def “Commonwealth tax” ins 1997 SL No. 360 s 4 def “community service obligations” ins 1997 SL No. 360 s 4 def “entity” ins 1997 SL No. 360 s 4 def “foreign society” om 1999 SL No. 149(2) def “full cost pricing” ins 1997 SL No. 360 s 4 def “LGA arrangement” ins 1994 SL No. 481 s 3(1) amd 2001 SL No. 253 s 3(1) def “original budget” ins 1997 SL No. 79 s 3 def “preferred supplier arrangement” sub 1994 SL No. 481 s 3 def “relevant business activity” ins 1997 SL No. 360 s 4 amd 2001 SL No. 253 of 2001 s 3(2) def “roads business activity” ins 1997 SL No. 360 s 4 def “SAC” om 2002 SL No. 91 s 3(1) def “SAP” om 2002 SL No. 91 s 3(1) def “standing offer arrangement” sub 1994 SL No. 481 s 3

54 Local Government Finance Standard 1994 def “statements of accounting concepts” sub 2002 SL No. 91 s 3(1)–(2) def “Statements of Accounting Practice” om 2002 SL No. 91 s 3(1) def “State tax” ins 1997 SL No. 360 s 4 def “tax” ins 1997 SL No. 360 s 4 Policies to be developed by each local government s 3 amd 1999 SL No. 114 s 4; 2003 SL No. 40 s 4 Revenue policy prov hdg prev prov hdg sub 2003 SL No. 40 s 5(1) pres prov hdg amd 2003 SL No. 40 10(1) s 8 prev s 8 amd 2003 SL No. 40 ss 4, 5(2) om 2003 SL No. 40 s 9 pres s 8 (prev s 8A) ins 2003 SL No. 40 s 6 amd 2003 SL No. 40 s 10(2) renum 2003 SL No. 40 s 10(3) Division 4—Contracts and tendering div hdg sub 1994 SL No. 481 s 4 Exemptions to requirement to seek tenders or quotations—Act, s 486(1)(e) s 11 sub 1994 SL No. 481 s 4 Preconditions for establishing a standing offer or preferred supplier arrangement s 12 sub 1994 SL No. 481 s 4 Preconditions for establishing a register of pre-qualified suppliers s 13 sub 1994 SL No. 481 s 4 Procedure for establishing purchasing arrangements s 14 sub 1994 SL No. 481 s 4 Division 5—Notional GST div hdg ins 2001 SL No. 161 s 3 Certificate about payment of notional GST s 14A ins 2001 SL No. 161 s 3 Requirements of corporate plan—Act, s 507 s 15 orig s 15 om 1994 SL No. 481 s 4 Assessment of local and regional issues s 16 amd 2001 SL No. 253 s 4 PART 5—BUDGET AND REVENUE STATEMENT pt hdg amd 2003 SL No. 40 s 7 Requirements of budget—Act, s 519 s 27 sub 1997 SL No. 79 s 4; 2002 SL No. 91 s 4 Requirements for revenue statement s 28 prev s 28 sub 1997 SL No. 79 s 4 om 2002 SL No. 91 s 5 pres s 28 ins 2003 SL No. 40 s 8 Amendment of budget s 29 amd 1999 SL No. 114 s 5

55 Local Government Finance Standard 1994 Disbursement because of genuine emergency or hardship—Act, s 519(4) s 30 orig s 30 om 1997 SL No. 79 s 4 Financial information to be presented to budget meeting—Act, s 521 s 31 amd 1999 SL No. 114 s 6 Accounting records s 32 amd 1996 SL No. 20 s 3; 1998 SL No. 276 s 4 om 2002 SL No. 91 s 5 Statements of account to be presented to local government—Act, s 528 s 34 amd 1999 SL No. 114 s 7 om 2002 SL No. 91 s 5 Value of non-current assets s 36 amd 1998 SL No. 276 s 5 sub 2002 SL No. 91 s 6 What is the current value of a non-current asset? s 37 amd 1998 SL No. 276 s 6 om 2002 SL No. 91 s 5 Details about non-current assets s 38 ins 1998 SL No. 276 s 7 om 2002 SL No. 91 s 5 Certain land and roads do not have a value s 39 sub 1998 SL No. 276 s 7 Revaluation of non-current assets s 40 sub 1997 SL No. 79 s 5 om 2002 SL No. 91 s 5 Decision that s 36 or s 40 does not apply s 41 sub 1997 SL No. 79 s 5 om 2002 SL No. 91 s 5 PART 6—ACCOUNTS pt hdg om 1999 SL No. 114 s 8 Division 4—Non-current liability valuation div hdg om 1999 SL No. 114 s 8 Documents about revaluations and adjustments s 42 om 2002 SL No. 91 s 5 Non-current liabilities s 43 om 1999 SL No. 114 s 8 Annual report s 44 sub 2002 SL No. 91 s 7 Note about reserves and roads controlled by local governments s 45 ins 1998 SL No. 276 s 8 Annual financial statements—Act, s 532 s 46 amd 2002 SL No. 91 s 8

56 Local Government Finance Standard 1994 Financial statements to include statement for significant business activities s 48 amd 1998 SL No. 276 s 9 sub 2002 SL No. 91 s 9 Appropriation statement s 49 om 2002 SL No. 91 s 5 Capital funding statement s 50 om 2002 SL No. 91 s 5 Operating capability s 51 om 2002 SL No. 91 s 5 Statement of original budget compared with actual results s 52 sub 1997 SL No. 79 s 6 om 2002 SL No. 91 s 5 Signing of financial statements—Act, s 532 s 53 amd 1998 SL No. 276 s 10 Certificate for proposed financial statements s 54 sub 1998 SL No. 276 s 11 amd 2002 SL No. 91 s 10 Certificate for final financial statements s 55 ins 1998 SL No. 276 s 11 amd 2002 SL No. 91 s 10 Unaudited financial statements s 57 prev s 57 exp 1 January 1995 (see s 57(3)) pres s 57 amd 1998 SL No. 276 s 12 PART 8—FULL COST PRICING pt hdg ins 1997 SL No. 360 s 7 Division 1—Preliminary div hdg ins 1997 SL No. 360 s 7 Object of pt 8 s 58 prev s 58 exp 1 January 1995 (see s 58(3)) pres s 58 ins 1997 SL No. 360 s 7 Application of pt 8 s 59 prev s 59 exp 1 July 1995 (see s 59(2)) pres s 59 ins 1997 SL No. 360 s 7 amd 1999 SL No. 114 s 9 Division 2—Full cost pricing div hdg ins 1997 SL No. 360 s 7 Subdivision 1—Matters affecting full cost pricing sdiv hdg ins 1997 SL No. 360 s 7 Matters affecting full cost pricing s 60 prev s 60 exp 1 July 1997 (see s 60(2)) pres s 60 ins 1997 SL No. 360 s 7

57 Local Government Finance Standard 1994 Subdivision 2—Full cost pricing sdiv hdg ins 1997 SL No. 360 s 7 Application of full cost pricing s 61 prev s 61 exp 1 July 1997 (see s 61(2)) pres s 61 ins 1997 SL No. 360 s 7 Different charges for commercial reasons s 62 prev s 62 exp 1 January 1997 (see s 62(3)) pres s 62 ins 1997 SL No. 360 s 7 Total costs of carrying on activity s 63 prev s 63 exp 1 January 1995 (see s 63(2)) pres s 63 ins 1997 SL No. 360 s 7 Administrative and overhead costs s 64 prev s 64(3)–(4) exp 1 July 1994 (see s 64(4)) remainder exp 1 July 1997 (see s 64(5)) pres s 64 ins 1997 SL No. 360 s 7 Cost of resources used in carrying on activity s 65 prev s 65 exp 1 January 1995 (see s 65(3)) pres s 65 ins 1997 SL No. 360 s 7 Depreciation s 66 ins 1997 SL No. 360 s 7 sub 1998 SL No. 142 s 4 amd 2002 SL No. 91 s 11 Equivalents for taxes not otherwise liable to be paid s 67 ins 1997 SL No. 360 s 7 Return on capital s 68 ins 1997 SL No. 360 s 7 Subdivision 3—Treatment of community service obligations sdiv hdg ins 1997 SL No. 360 s 7 Extra cost for community service obligations to be treated as revenue s 69 ins 1997 SL No. 360 s 7 PART 9—COMMERCIALISATION pt hdg ins 1998 SL No. 142 s 5 Division 1—Preliminary div 1 (ss 70–71) ins 1998 SL No. 142 s 5 Division 2—Commercialisation div hdg ins 1998 SL No. 142 s 5 Subdivision 1—Matters affecting commercialisation sdiv 1 (s 72) ins 1998 SL No. 142 s 5 Subdivision 2—Full cost pricing sdiv hdg ins 1998 SL No. 142 s 5

58 Local Government Finance Standard 1994 Application of full cost pricing s 73 ins 1998 SL No. 142 s 5 Different charges for commercial reasons s 74 ins 1998 SL No. 142 s 5 Total costs of carrying on activity s 75 ins 1998 SL No. 142 s 5 Administrative and overhead costs s 76 ins 1998 SL No. 142 s 5 Cost of resources used in carrying on activity s 77 ins 1998 SL No. 142 s 5 Depreciation s 78 ins 1998 SL No. 142 s 5 amd 2002 SL No. 91 s 11 Return on capital s 79 ins 1998 SL No. 142 s 5 Subdivision 3—Treatment of community service obligations sdiv 3 (s 80) ins 1998 SL No. 142 s 5 Subdivision 4—Annual performance plan sdiv 4 (s 81) ins 1998 SL No. 142 s 5 PART 10—CODE OF COMPETITIVE CONDUCT pt hdg ins 1997 SL No. 360 s 7 Division 1—Preliminary div 1 (ss 82–83) ins 1997 SL No. 360 s 7 Division 2—The code div hdg ins 1997 SL No. 360 s 7 Subdivision 1—Elements of the code sdiv 1 (s 84) ins 1997 SL No. 360 s 7 Subdivision 2—Full cost pricing sdiv hdg ins 1997 SL No. 360 s 7 Application of full cost pricing s 85 ins 1997 SL No. 360 s 7 Different charges for commercial reasons s 86 ins 1997 SL No. 360 s 7 Total costs of carrying on activity s 87 ins 1997 SL No. 360 s 7 Administrative and overhead costs s 88 ins 1997 SL No. 360 s 7 Cost of resources used in carrying on activity s 89 ins 1997 SL No. 360 s 7

59 Local Government Finance Standard 1994 Depreciation s 90 ins 1997 SL No. 360 s 7 sub 1998 SL No. 142 s 6 amd 2002 SL No. 91 s 11 Equivalents for taxes not otherwise liable to be paid s 91 ins 1997 SL No. 360 s 7 Equivalents for State guarantees on borrowings s 92 ins 1997 SL No. 360 s 7 Return on capital s 93 ins 1997 SL No. 360 s 7 Subdivision 3—Treatment of community service obligations sdiv 3 (ss 94–95) ins 1997 SL No. 360 s 7 Subdivision 4—Elimination of, or taking into account, advantages and disadvantages of public ownership sdiv 4 (s 96) ins 1997 SL No. 360 s 7 Subdivision 5—Financial reporting sdiv hdg ins 1997 SL No. 360 s 7 Statement in budget s 97 ins 1997 SL No. 360 s 7 Omission of certain matters from statement in budget s 98 ins 1997 SL No. 360 s 7 Statement in annual report s 99 ins 1997 SL No. 360 s 7 amd 2002 SL No. 91 s 12 Omission of certain matters from statement in annual report s 100 ins 1997 SL No. 360 s 7 PART 11—REFORM OF CERTAIN WATER AND SEWERAGE SERVICES pt hdg ins 1997 SL No. 360 s 7 Division 1—Preliminary div 1 (s 101) ins 1997 SL No. 360 s 7 Division 2—Matters to be complied with div hdg ins 1997 SL No. 360 s 7 Subdivision 1—Matters to be complied with for relevant business activities sdiv 1 (s 102) ins 1997 SL No. 360 s 7 Subdivision 2—Two-part tariffs sdiv 2 (s 103) ins 1998 SL No. 276 s 13 Subdivision 3—Consumption as the basis for utility charges for water services sdiv hdg ins 1997 SL No. 360 s 7 Application of sdiv 3 s 104 ins 1997 SL No. 360 s 7

60 Local Government Finance Standard 1994 Consumption as the basis for utility charges s 105 prev s 105 (prev s 65) ins 1997 SL No. 79 s 8 renum 1997 SL No. 360 s 6 sub 1998 SL No. 276 s 18 om R2 (see RA s 37) pres s 105 ins 1997 SL No. 360 s 7 When charges are based on quantity of water supplied s 106 ins 1997 SL No. 360 s 7 Subdivision 4—Full cost recovery sdiv hdg ins 1997 SL No. 360 s 7 Application of sdiv 4 s 107 ins 1997 SL No. 360 s 7 amd 1998 SL No. 276 s 14 Application of full cost recovery s 108 ins 1997 SL No. 360 s 7 Total costs of carrying on relevant business activity s 109 ins 1997 SL No. 360 s 7 Administrative and overhead costs s 110 ins 1997 SL No. 360 s 7 Cost of resources used in carrying on relevant business activity s 111 ins 1997 SL No. 360 s 7 Depreciation s 112 ins 1997 SL No. 360 s 7 sub 1998 SL No. 142 s 7 amd 2002 SL No. 91 s 11 Return on capital s 113 ins 1997 SL No. 360 s 7 Subdivision 5—Treatment of community service obligations sdiv 5 (s 114) ins 1997 SL No. 360 s 7 Subdivision 6—Identification and disclosure of cross-subsidies between classes of consumers sdiv 6 (s 115) ins 1997 SL No. 360 s 7 Identification and disclosure of cross-subsidies s 116 ins 1998 SL No. 276 s 15 Subdivision 7—Disclosure of community service obligations sdiv 7 (s 117) ins 1997 SL No. 360 s 7 Division 3—Two-part tariffs div hdg ins 1997 SL No. 360 s 7 om 1998 SL No. 276 s 16 PART 12—TRANSITIONAL pt hdg (prev pt 8 hdg) renum 1997 SL No. 360 s 5 om 2001 SL No. 253 s 5

61 Local Government Finance Standard 1994 Local government to keep accounting manual s 118 ins 1997 SL No. 360 s 7 sub 1998 SL No. 276 ss 16–17 (retro) exp 30 June 1999 (see s 118(2)) Crediting of non-current infrastructure asset values to capital s 119 (prev s 62) ins 1997 SL No. 79 s 7 renum 1997 SL No. 360 s 6 sub 1998 SL No. 276 s 18 exp 30 June 2000 (see s 119(2)) SCHEDULE—EXAMPLE FINANCIAL STATEMENTS amd 1999 SL No. 114 s 10 om 2002 SL No. 91 s 5 8 Table of renumbered provisions TABLE OF RENUMBERED PROVISIONS [Reprint No. 2] under the Reprints Act 1992 s 43 as required by the Local Government Finance Standard 1994 s 105 Previous Renumbered as 16 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .15 17 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .16 18 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .17 19 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .18 20 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .19 21 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .20 22 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21 23 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .22 24 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .23 25 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .24 26 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .25 27 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .26 28 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .27 29 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .28 31 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .29 32 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .30 33 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .31 34 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .32 35 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .33 36 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .34 37 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35 38 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36 39 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .37 39A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .38 40 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39 41 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .40

62 Local Government Finance Standard 1994 Previous Renumbered as 42 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .41 43 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .42 44 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .43 45 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .44 45A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .45 54A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .55 55 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .56 56 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .57 57 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .58 58 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .59 59 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .60 60 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .61 61 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .62 62 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .63 63 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .64 64 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .65 65 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .66 66 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .67 67 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .68 68 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .69 pt 8A hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .pt 9 hdg 68A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .70 68B . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71 68C . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .72 68D . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .73 68E. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .74 68F. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .75 68G . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .76 68H . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .77 68I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .78 68J . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .79 68K . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .80 68L. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .81 pt 9 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .pt 10 hdg 69 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .82 70 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .83 71 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .84 72 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .85 73 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .86 74 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .87 75 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .88 76 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .89 77 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .90 78 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .91 79 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .92 80 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .93 81 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .94 82 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .95

63 Local Government Finance Standard 1994 Previous Renumbered as 83 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .96 84 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .97 85 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .98 86 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .99 87 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .100 pt 10 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .pt 11 hdg 88 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .101 89 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .102 sdiv 1A hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .sdiv 2 hdg 89A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .103 sdiv 2 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .sdiv 3 hdg 90 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .104 91 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .105 92 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .106 sdiv 3 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .sdiv 4 hdg 93 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .107 94 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .108 95 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .109 96 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .110 97 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .111 98 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .112 99 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .113 sdiv 4 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .sdiv 5 hdg 100 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .114 sdiv 5 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .sdiv 6 hdg 101 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .115 101A . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .116 sdiv 6 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .sdiv 7 hdg 102 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .117 pt 11 hdg . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .pt 12 hdg 103 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .118 104 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .119 © State of Queensland 2005