Finance

Finance

Local Government in SA manages its finances conservatively under extreme constraints. It has access to one tax, Council Rates, has very low debt and receives an unfair share of State and Federal government funding. A major Commonwealth Parliamentary Inquiry outlined Local Government's financial position well. For more information regarding the report - click here.

In 2005 the LGA commissioned an Independent Inquiry into the Financial Sustainability of Local Government in SA. Background to the inquiry, its final report and processes for responding to its 62 recommendations can be found - here.

• More information on the Independent Inquiry into the Financial Sustainability of Local Government in SA - https://www.lga.sa.gov.au/goto/fsinquiry.

• More information on the Commonwealth Parliamentary Inquiry report (Hawker Report) "Rates and Taxes: A Fair Share for Responsible Local Government" - https://www.lga.sa.gov.au/goto/fairshare.

Information to assist Councils in this area can be found below.

Financial Management

There is a continuing evolvement and reform of financial management practices occuring, both directly and indirectly, in Local Government. Recent and current changes and issues include:

• increased scrutiny by the community;
• an expectation to do more with less;
• accural accounting;
• National Competition Policy;
• performance measurement and benchmarking;
• infrastructure asset management;
• internal controls; and
• Governance.

A range of resources (to the right) have been developed to assist Councils apply good practices in financial management.

What's New

2011 Model Financial Statements for SA

The LGA's Financial Management Project Group and the South Australian Local Government Financial Management Group (SALGFMG) have been working with Coalface Software Solutions to develop a set of Model Financial Statements for South Australian Councils for 2011. The Model Financial Statements are now available.

A copy of the Model Financial Statements 2011 can be found here: 2011 Model Financial Statements

Summaries of Councils' Finances

The LGA and OSLGR have initiated arrangements whereby any Council can choose to publish high-level summary information about its finances in a central and publicly accessible location on the LGA's website (with OSLGR's website linked to that site). Up-to-date factual information about the financial performance and position of an initial "batch" of 33 Councils can be found here: Summaries of Councils Finances (158 kb).

Infrastructure Accounting

The LGA in collaboration with the SA Local Government Financial Management Group commissioned the preparation of three Technical Information Papers on the following topics:

• Depreciation of Infrastructure Assets
• Costing for Assets (including overheads)
• Valuation

The purpose of these papers is to stimulate discussion on these topics among finance and engineering professionals and to supplement the content of the Australian Infrastructure Financial Management Guidelines being prepared by the Institute of Public Works Engineering Australia and due for release in the first half of 2009. The papers on Depreciation of Infrastructure Assets and Costing for Assets are available here:

Technical Information Paper - Depreciation of Infrastructure Assets (1267 kb)

Technical Information Paper - Costing for Assets (1233 kb)

The paper on Valuation will be available on this web page soon.

Local Government Reform

In February 2010 the LGA, working collaboratively with the Department of Planning and Local Government, received funding approval from the Australian Government's Local Government Reform Fund towards a comprehensive  "Improving SA Councils' Asset and Financial Management Practices" project.  The LGA has underpinned this initiative with organisational changes to showcase an ongoing Local Government Reform agenda.

More information about the LGA's Local Government Reform Program and the "Improving SA Councils' Asset and Financial Management Practices" project can be obtained via the following link:  www.lga.sa.gov.au/goto/reform.

Useful links

• Financing Local Government's Contribution to Community Development - Centre for Economic Studies 2002 400 kb
• A Framework for Financial Management - LGA 2001 723 kb
• Internal Financial Controls - Best Practice Manual 2002 4624 kb
• LG Financial Management Regulations 1999 - LGA Discussion Paper 2000 158 kb
• Fees & Charges Guide to GST, Div. 81 - LGA 2002 938 kb
• Investment Policy & Review of Investments 204 kb
• Full Cost Attribution - A Guide to Implementation - LGA 2001 397 kb
• Emergency Services Assets - Guide to Accounting for the Transfer to State - LGA 2000 174 kb
• GST Implementation Manual - LGA 2000 534 kb
• GST Guidance from the ATO - Garbage Disposals Guidance Note - 2000 70 kb
• GST Guidance from the ATO - GST Treatment of Developer Contributions - 2000 99 kb
• Financial Management Scoping Study July 2003 592 kb
• Model Budget Template - 2007-2008 (2373 kb)
• 2011 Model Financial Statements
• Summaries of Councils Finances (158 kb)
• Technical Information Paper - Depreciation of Infrastructure Assets (1267 kb)
• Technical Information Paper - Costing for Assets (1233 kb)