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Annual Report Contents Page 1 2010/11 Queenstown Lakes District Council Annual Report Contents Page 1 Introduction Chief Executive Report ....................................................................................................................................................2 General Information Statutory Planning Process .............................................................................................................................................9 District Map ....................................................................................................................................................................10 Management Structure .................................................................................................................................................. 11 Contact Us ..................................................................................................................................................................... 12 Financial Information Governance Report .......................................................................................................................................................13 Statement of Compliance and Responsibility ................................................................................................................14 Statement of Financial Performance – Council and consolidated .................................................................................15 Statement of Financial Position – Council and consolidated .........................................................................................16 Statement of Comprehensive Income – Council and consolidated ...............................................................................18 Statement of Changes in Equity - Council and consolidated ..........................................................................................19 Statement of Cashflows – Council and consolidated ....................................................................................................20 Notes to the Financial Statements .................................................................................................................................21 Statements of Service Performance Introduction ....................................................................................................................................................................60 Community Outcomes ...................................................................................................................................................61 Governance ..................................................................................................................................................................63 District Promotion.............................................................................................................................................................65 Property ......................................................................................................................................................................... 67 Community ....................................................................................................................................................................69 Resource Management and Regulation ........................................................................................................................77 Utilities ...........................................................................................................................................................................83 Roading and Parking .....................................................................................................................................................88 Queenstown Airport Corporation Limited ........................................................................................................................91 Lakes Leisure Limited ......................................................................................................................................................93 Lakes Environmental Limited ..........................................................................................................................................96 Audit Report ...................................................................................................................................................................97 Chief Executive Report 2 • Depreciation expense for the year is $0.45m lower than budget. This is a non-cash item and relates primarily to the timing of project expenditure and lower than anticipated levels of vested assets. • Legal costs for the year are $2.9m above budget. This variance is mostly due to the inclusion of a $2.4m provision for claims against the Council and the cost of defending the action taken against Council in relation to the change in QAC share-holding ($0.6m). • There is $2.1m of project expenditure that was classified as capital expenditure within the budget but has been charged as an operating expense for the year. This is not an over-spend as there is budget provided to cover it. • The balance of the positive variance of $2.1m relates primarily to reduced maintenance costs for utilities ($0.9m), and roading ($0.9m) . Introduction Capital expenditure was below estimate by $40.3m for the year ended 30 June 2011. The following major items contributed to this variance: The purpose of the Annual Report is to account for Council’s achievements against objectives included in the 2010/2011 Annual Plan. The 2010/2011 year represents year two of the 2009 10-Year Plan. • The main component of the variance relates to $11.3m of project expenditure within the water supply and wastewater activities which has been delayed or deferred. Projects include several reticulation upgrades in Wanaka and Queenstown and upgrades to Wanaka and Frankton wastewater pump stations, and the Arrowtown Financial Result 2010/2011 reservoir. • There is $10.1m of project expenditure within the roading activity which has been delayed or deferred. This The Council and its subsidiaries; Queenstown Airport Corporation, Lakes Leisure Limited and Lakes Environmental includes upgrades to the Ardmore/Brownston intersection in Wanaka ($2.7m) and the Frankton Flats arterial Limited, have reported an operating surplus of $6.6m for the year. Each entity within the group has contributed to an road ($1.1m). improved financial result when compared to last year’s $6.3m group surplus. This is a good place to be in difficult • There is also $4.5m of project expenditure within the community services activity which has been delayed or economic conditions and has been based on effective controls of costs during the period. deferred. Most of the budget for the Wanaka Sports Facilities project ($0.34m) was not spent and has been carried forward. Other projects affected were Wakatipu and Wanaka Reserve Land ($3.3m) and planned The Council alone recorded an operating surplus of $0.6m for the year. Operating revenues were down by 11% on upgrades to the Earnslaw Park Toilets ($0.55m). last year and below budget by 21.5% (see below). Operating costs were on budget for the year (up on last year by • There is also $2.6m of project expenditure within the commercial property activity which has been delayed 4.1%). However, these costs are inflated by the inclusion of a provision of $2.4m for legal claims against the Council. or deferred. This mainly relates to the timing of the upgrade to water and sewerage systems at Glendhu Bay The reported surplus includes $1.6m of unrealised losses pertaining to the revaluation of investment property. This Holiday Park ($1.9m). follows a 2010 value reduction of $5.2m, which together represents an unrealised loss in value of around 9.3% in the • Vested Assets were $6.7m below budget for the year. past 2 years. • Loan Repayments were $1.2m below budget for the year. • The remaining component of the variance relates to $2.1m of project expenditure which was classified as capital Revenue was below estimate by $24.6m for the year ended 30 June, 2011. The following major items (all relating to expenditure within the budget but which has been charged as an operating expense for the year. capital expenditure) contributed to this variance: The revaluation of investment property resulted in an unbudgeted reduction in value of $1.6m for the year. This • Development contribution income was below budget by $10.7m for the year principally because of the continued movement coupled with the $22.1m unrealised loss for previous two years, has lead to the main variation in the slowdown in consent related activity. balance sheet which shows Investment Property $27m below the forecast position. Borrowings are $23m below • Vested Assets (these are assets passed to Council through subdivision and include roads, infrastructure and forecast; this positive variance relates mainly to the deferral of capital projects (see above). reserves) were $6.7m below budget for the year. • Roading subsidy was $4.6m under budget for the year, as a result of reduced roading capital expenditure due to the timing and deferral of some projects. Big Issues Operating expenditure was on budget for the year ended 30 June 2011. This is very pleasing and means that we were Election 2010 able to stay within budget from an operating perspective. It has been achieved through savings across most activities. In October 2010 the Local
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