SHIRE OF BROOME

FINANCIAL REPORT

FOR THE YEAR ENDED 30 JUNE 2022

TABLE OF CONTENTS

Certification of Financial Report 2

Statement of Comprehensive Income by Nature or Type 3

Statement of Financial Position 4

Statement of Changes in Equity 5

Statement of Cash Flows 6

Rate Setting Statement 7

Index of Notes to the Financial Report 8

Independent Auditor's Report 51

The SHIRE OF BROOME conducts the operations of a local government with the following
community vision:

Broome - a future, for everyone

Principal place of business:

27 Weld Street
BROOME WA 6725

|1
 SHIRE OF BROOME
FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

Local Government Act 1995

Local Government (Financial Management) Regulations 1996

STATEMENT BY CHIEF EXECUTIVE OFFICER

The attached financial report of the SHIRE OF BROOME for the financial year ended
30 June 2022 is based on proper accounts and records to present fairly the financial position of
the SHIRE OF BROOME at 30 June 2022 and the results of the operations for the financial
year then ended in accordance with the Local Government Act 1995 and, to the extent that they
are not inconsistent with the Act, the Australian Accounting Standards.

Signed on the 13th day of April 2023

Chief Executive Officer

Salvatore Mastrolembo
Name of Chief Executive Officer

|2
SHIRE OF BROOME
STATEMENT OF COMPREHENSIVE INCOME
BY NATURE OR TYPE
FOR THE YEAR ENDED 30 JUNE 2022
2022 2022 2021
NOTE Actual Budget Actual
$ $ $
Revenue
Rates 26(a),2(a) 23,902,635 23,992,547 23,282,829
Operating grants, subsidies and contributions 2(a) 3,281,048 1,943,852 3,920,623
Fees and charges 25(c),2(a) 9,248,594 12,078,532 9,711,973
Interest earnings 2(a) 419,247 335,984 408,171
Other revenue 2(a) 989,801 1,182,519 1,009,207
37,841,325 39,533,434 38,332,803

Expenses
Employee costs (16,813,230) (17,141,230) (15,789,253)
Materials and contracts (8,059,965) (10,467,153) (8,687,789)
Utility charges (2,359,931) (2,144,443) (2,100,053)
Depreciation 10(a) (14,277,414) (12,629,134) (12,525,339)
Finance costs 2(b) (242,307) (122,688) (138,797)
Insurance (720,985) (768,853) (767,166)
Other expenditure 2(b) (1,019,519) (2,196,837) (1,577,698)
(43,493,351) (45,470,338) (41,586,095)
(5,652,026) (5,936,904) (3,253,292)

Capital grants, subsidies and contributions 2(a) 8,583,402 8,226,226 26,883,370

Profit on asset disposals 10(b) 34,267 100,568 11,822
Loss on asset disposals 10(b) (48,227) (165,955) (436,769)
Loss on revaluation of Infrastructure Others 9(a) (8,383,982) 0 0
185,460 8,160,839 26,458,423

Net result for the period 25(b) (5,466,566) 2,223,935 23,205,131

Other comprehensive income for the period

Items that will not be reclassified subsequently to profit or loss

Changes in asset revaluation surplus 17 17,846,697 0 601,628

Total other comprehensive income for the period 17 17,846,697 0 601,628

Total comprehensive income for the period 12,380,131 2,223,935 23,806,759

This statement is to be read in conjunction with the accompanying notes.

OAG
AUDITED |3
SHIRE OF BROOME
STATEMENT OF FINANCIAL POSITION
AS AT 30 JUNE 2022
NOTE 2022 2021
$ $
CURRENT ASSETS
Cash and cash equivalents 3 43,413,804 44,065,529
Trade and other receivables 5 2,015,721 3,101,366
Inventories 6 31,520 65,150
Other assets 7 225,940 230,253
TOTAL CURRENT ASSETS 45,686,985 47,462,298

NON-CURRENT ASSETS
Trade and other receivables 5 48,671 34,652
Other financial assets 4 1,347,255 1,342,259
Property, plant and equipment 8 86,054,785 77,802,109
Infrastructure 9 332,051,620 326,972,446
TOTAL NON-CURRENT ASSETS 419,502,331 406,151,466

TOTAL ASSETS 465,189,316 453,613,764

CURRENT LIABILITIES
Trade and other payables 12 5,824,127 7,341,078
Other liabilities 13 4,329,941 5,176,832
Borrowings 14 444,162 859,957
Employee related provisions 15 2,783,876 2,244,467
Other provisions 16 91,147 700,158
TOTAL CURRENT LIABILITIES 13,473,253 16,322,492

NON-CURRENT LIABILITIES
Borrowings 14 6,786,745 5,430,907
Employee related provisions 15 267,558 193,039
Other provisions 16 3,098,070 2,483,767
TOTAL NON-CURRENT LIABILITIES 10,152,373 8,107,713

TOTAL LIABILITIES 23,625,626 24,430,205

NET ASSETS 441,563,690 429,183,559

EQUITY
Retained surplus 155,253,553 162,665,877
Reserve accounts 29 32,792,021 30,846,263
Revaluation surplus 17 253,518,116 235,671,419
TOTAL EQUITY 441,563,690 429,183,559

This statement is to be read in conjunction with the accompanying notes.

OAG
AUDITED
|4
SHIRE OF BROOME
STATEMENT OF CHANGES IN EQUITY
FOR THE YEAR ENDED 30 JUNE 2022

RETAINED RESERVE REVALUATION TOTAL

NOTE SURPLUS ACCOUNTS SURPLUS EQUITY
$ $ $ $

Balance as at 1 July 2020 138,434,050 31,872,959 235,069,791 405,376,800

Comprehensive income for the period

Net result for the period 23,205,131 0 0 23,205,131

Other comprehensive income for the period 17 0 0 601,628 601,628

Total comprehensive income for the period 23,205,131 0 601,628 23,806,759

Transfers from reserves 29 4,206,993 (4,206,993) 0 0

Transfers to reserves 29 (3,180,297) 3,180,297 0 0

Balance as at 30 June 2021 162,665,877 30,846,263 235,671,419 429,183,559

Comprehensive income for the period

Net result for the period (5,466,566) 0 0 (5,466,566)

Other comprehensive income for the period 17 0 0 17,846,697 17,846,697

Total comprehensive income for the period (5,466,566) 0 17,846,697 12,380,131

Transfers from reserves 29 3,541,907 (3,541,907) 0 0

Transfers to reserves 29 (5,487,665) 5,487,665 0 0

Balance as at 30 June 2022 155,253,553 32,792,021 253,518,116 441,563,690

This statement is to be read in conjunction with the accompanying notes.

OAG
AUDITED
|5
SHIRE OF BROOME
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED 30 JUNE 2022
2022 2022 2021
NOTE Actual Budget Actual
$ $ $
CASH FLOWS FROM OPERATING ACTIVITIES
Receipts
Rates 24,093,197 23,992,547 23,355,813
Operating grants, subsidies and contributions 3,288,853 1,943,852 7,365,254
Fees and charges 9,055,083 12,078,532 9,771,141
Interest received 419,247 335,984 298,812
Goods and services tax received 3,171,331 0 0
Other revenue 989,801 1,182,519 1,005,974
41,017,512 39,533,434 41,796,994
Payments
Employee costs (16,602,430) (17,141,230) (15,955,750)
Materials and contracts (9,135,633) (10,467,153) (7,686,318)
Utility charges (2,359,931) (2,144,443) (2,100,053)
Finance costs (242,307) (122,688) (88,320)
Insurance paid (720,985) (768,853) (767,166)
Goods and services tax paid (2,846,940) 0 (728,268)
Other expenditure (1,024,515) (2,196,837) (1,577,698)
(32,932,741) (32,841,204) (28,903,573)

Net cash provided by (used in) operating activities 18(b) 8,084,771 6,692,230 12,893,421

CASH FLOWS FROM INVESTING ACTIVITIES

Payments for remdiations related expenses 16 (118,562) 0 (121,117)

Payments for financial assets at amortised cost - self
supporting loans 0 (300,000) 0
Payments for purchase of property, plant & equipment (3,624,205) (7,438,318) (9,496,603)
Payments for construction of infrastructure 9(a) (14,655,205) (15,270,067) (26,122,834)
Non-operating grants, subsidies and contributions 8,470,388 8,926,384 22,184,375
Proceeds from financial assets at amortised cost - self
supporting loans 0 393,483 0
Proceeds from sale of property, plant & equipment 10(b) 251,046 694,000 219,715
Net cash provided by (used in) investing activities (9,676,538) (12,994,518) (13,336,464)

CASH FLOWS FROM FINANCING ACTIVITIES

Repayment of borrowings 28(a) (859,958) (1,011,664) (854,091)
Advances to community groups 28(a) 0 0 (1,250,000)
Proceeds from new borrowings 28(a) 1,800,000 2,100,000 3,035,000
Net cash provided by (used In) financing activities 940,042 1,088,336 930,909

Net increase (decrease) in cash held (651,725) (5,213,952) 487,866

Cash at beginning of year 44,065,529 42,478,719 43,577,663
Cash and cash equivalents at the end of the year 18(a) 43,413,804 37,264,767 44,065,529

This statement is to be read in conjunction with the accompanying notes.

|6
SHIRE OF BROOME
RATE SETTING STATEMENT
FOR THE YEAR ENDED 30 JUNE 2022
2022 2022 2021 2021
Actual - as
Actual - as
NOTE Actual Budget Adjustments* Previously
Restated
Reported
$ $ $
NET CURRENT ASSETS - At start of financial year - surplus/(deficit) 27(c) 4,535,688 5,492,969 2,828,740 (1,359,652) 4,188,392

OPERATING ACTIVITIES
Revenue from operating activities (excluding general rate)
Operating grants, subsidies and contributions 3,281,048 1,943,852 3,920,623 0 3,920,623
Fees and charges 9,248,594 12,078,532 9,711,973 0 9,711,973
Interest earnings 419,247 335,984 408,171 0 408,171
Other revenue 989,801 1,182,519 1,009,207 0 1,009,207
Profit on asset disposals 10(b) 34,267 100,568 11,822 0 11,822
13,972,957 15,641,455 15,061,796 0 15,061,796
Expenditure from operating activities
Employee costs (16,813,230) (17,141,230) (15,789,253) 0 (15,789,253)
Materials and contracts (8,059,965) (10,467,153) (8,687,789) 0 (8,687,789)
Utility charges (2,359,931) (2,144,443) (2,100,053) 0 (2,100,053)
Depreciation (14,277,414) (12,629,134) (12,525,339) 0 (12,525,339)
Finance costs (242,307) (122,688) (138,797) 0 (138,797)
Insurance (720,985) (768,853) (767,166) 0 (767,166)
Other expenditure (1,019,519) (2,196,837) (1,577,698) 0 (1,577,698)
Loss on asset disposals 10(b) (48,227) (165,955) (436,769) 0 (436,769)
Loss on revaluation of non-current assets (8,383,982) 0 0 0 0
(51,925,560) (45,636,293) (42,022,864) 0 (42,022,864)

Non-cash amounts excluded from operating activities 27(a) 22,751,821 12,694,521 9,621,389 (1,387,768) 11,009,157
Amount attributable to operating activities (15,200,782) (17,300,317) (17,339,679) (1,387,768) (15,951,911)

INVESTING ACTIVITIES
Non-operating grants, subsidies and contributions 8,583,402 8,226,226 26,883,370 0 26,883,370
Proceeds from disposal of assets 10(b) 251,046 694,000 219,715 0 219,715
Proceeds from financial assets at amortised cost - self supporting
0 300,000 0 0
loans 28(a)
Payments for financial assets at amortised cost - self supporting loans 0 (300,000) 0 0
Payments for remediation related expenses 0 0 0 121,117 (121,117)
Purchase of property, plant and equipment 8(a) (3,817,999) (7,438,318) (9,496,603) 0 (9,496,603)
Purchase and construction of infrastructure 9(a) (14,593,559) (15,270,067) (26,122,834) 0 (26,122,834)
Payments for site remediation costs 16 0 (700,158) 0 0 0
(9,577,110) (14,488,317) (8,516,352) 121,117 (8,637,469)

Non-cash amounts excluded from investing activities 27(b) 236,868 0 2,322,545 2,322,545 0
Amount attributable to investing activities (9,340,242) (14,488,317) (6,193,807) 2,443,662 (8,637,469)

FINANCING ACTIVITIES
Repayment of borrowings 28(a) (859,958) (1,011,664) (854,091) 0 (854,091)
Proceeds from borrowings 28(a) 1,800,000 2,100,000 3,035,000 0 3,035,000
Advances to community groups 5 0 0 (1,250,000) 0 (1,250,000)
Repayment of self-supporting loans by community groups 0 93,483 0 0
Transfers to reserves (restricted assets) 29 (5,487,665) (2,441,206) (3,180,297) 0 (3,180,297)
Transfers from reserves (restricted assets) 29 3,541,907 3,562,505 4,206,993 0 4,206,993
Amount attributable to financing activities (1,005,716) 2,303,118 1,957,605 0 1,957,605

Surplus/(deficit) before imposition of general rates (21,011,052) (23,992,547) (18,747,141) (303,758) (18,443,383)
Total amount raised from general rates 26(a) 23,902,635 23,992,547 23,282,829 0 23,282,829
Surplus/(deficit) after imposition of general rates 27(c) 2,891,583 0 4,535,688 (303,758) 4,839,446

*Refer to Note 31 for information on the adjustments made.

This statement is to be read in conjunction with the accompanying notes.

|7
SHIRE OF BROOME
FOR THE YEAR ENDED 30 JUNE 2022
INDEX OF NOTES TO THE FINANCIAL REPORT

Note 1 Basis of Preparation 9

Note 2 Revenue and Expenses 10
Note 3 Cash and Cash Equivalents 12
Note 4 Other Financial Assets 12
Note 5 Trade and Other Receivables 13
Note 6 Inventories 14
Note 7 Other Assets 15
Note 8 Property, Plant and Equipment 16
Note 9 Infrastructure 18
Note 10 Fixed Assets 20
Note 11 Leases 23
Note 12 Trade and Other Payables 24
Note 13 Other Liabilities 25
Note 14 Borrowings 26
Note 15 Employee Related Provisions 27
Note 16 Other Provisions 28
Note 17 Revaluation Surplus 29
Note 18 Notes to the Statement of Cash Flows 30
Note 19 Contingent Liabilities 31
Note 20 Capital Commitments 31
Note 21 Related Party Transactions 32
Note 22 Financial Risk Management 34
Note 23 Events Occurring After the End of the Reporting Period 38
Note 24 Other Significant Accounting Policies 39
Note 25 Function and Activity 40

Information required by legislation

Note 26 Rating Information 43
Note 27 Rate Setting Statement Information 46
Note 28 Borrowing and Lease Liabilities 47
Note 29 Reserve accounts 48
Note 30 Trust Funds 49
Note 31 Restatement of Rate Setting Statement 50

|8
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

1. BASIS OF PREPARATION

Basis of preparation The local government reporting entity

The financial report comprises general purpose financial All funds through which the Shire controls resources to carry
statements which have been prepared in accordance with on its functions have been included in the financial statements
the Local Government Act 1995 and accompanying regulations. forming part of this financial report.

Local Government Act 1995 requirements All monies held in the Trust Fund are excluded from
Section 6.4(2) of the Local Government Act 1995 read with the Local the financial statements. A separate statement of those
Government (Financial Management) Regulations 1996 prescribe that monies appears at Note 30 of the financial report.
the financial report be prepared in accordance with the Local
Government Act 1995 and, to the extent that they are not inconsistent Judgements and estimates
with the Act, the Australian Accounting Standards. The Australian The preparation of a financial report in conformity with
Accounting Standards (as they apply to local governments and not-for- Australian Accounting Standards requires management
profit entities) and Interpretations of the Australian Accounting Standards to make judgements, estimates and assumptions that effect
Board were applied where no inconsistencies exist. the application of policies and reported amounts of assets
and liabilities, income and expenses.
The Local Government (Financial Management) Regulations 1996
specify that vested land is a right-of-use asset to be measured at cost, The estimates and associated assumptions are based on
and is considered a zero cost concessionary lease. All right-of-use historical experience and various other factors that are
assets under zero cost concessionary leases are measured at zero cost believed to be reasonable under the circumstances; the results
rather than at fair value, except for vested improvements on of which form the basis of making the judgements about
concessionary land leases such as roads, buildings or other carrying values of assets and liabilities that are not readily
infrastructure which continue to be reported at fair value, as opposed to apparent from other sources. Actual results may differ from
the vested land which is measured at zero cost. The measurement of these estimates.
vested improvements at fair value is a departure from AASB 16 which
would have required the City to measure any vested improvements at The balances, transactions and disclosures impacted by accounting
zero cost. Accounting policies which have been adopted in the estimates are as follows:
preparation of this financial report have been consistently applied unless
stated otherwise. Except for cash flow and rate setting information, the • estimated fair value of certain financial assets
financial report has been prepared on the accrual basis and is based on • impairment of financial assets
historical costs, modified, where applicable, by the measurement at fair • estimation of fair values of land and buildings, and infrastructure.
value of selected non-current assets, financial assets and liabilities.

|9
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

2. REVENUE AND EXPENSES

(a) Revenue

Contracts with customers

Recognition of revenue is dependant on the source of revenue and the associated terms and conditions associated with each source
of revenue and recognised as follows:
When obligations Returns/Refunds/
Revenue Category Nature of goods and services typically satisfied Payment terms Warranties Timing of revenue recognition
Payment dates adopted by
Rates General Rates Single point in time None When rates notice is issued
Council during the year
Payment dates adopted by Refund in event
Service charges Charge for specific service Over time When rates notice is issued
Council during the year monies are unspent
Output method based on project
Community events, minor facilities, Fixed terms transfer of funds milestones and/or completion date
Grant contracts with Contract obligation if
research, design, planning Over time based on agreed milestones matched to performance obligations as
customers project not complete
evaluation and services and reporting inputs are shared

Output method based on project

Grants, subsidies or Construction or acquisition of
Fixed terms transfer of funds milestones and/or completion date
contributions for the recognisable non-financial assets Contract obligation if
Over time based on agreed milestones matched to performance obligations as
construction of non-financial to be controlled by the local project not complete
and reporting inputs are shared
assets government
General appropriations and
Grants with no contractual contributions with no specific
No obligations Not applicable Not applicable When assets are controlled
commitments contractual commitments

Building, planning, development

Licences/ Registrations/ and animal management, having On payment and issue of the licence,
Single point in time Full payment prior to issue None
Approvals the same nature as a licence registration or approval
regardless of naming.
Equal proportion based on an
After inspection complete based on a 4
Pool inspections Compliance safety check Single point in time equal annually fee None
year cycle
Regulatory Food, Health and Full payment prior to Revenue recognised after inspection
Other inspections Single point in time None
Safety inspection event occurs
Output method based on regular weekly
Waste management Payment on an annual basis in and fortnightly period as proportionate to
Kerbside collection service Over time None
collections advance collection service

Payment in advance at gate or

Waste management entry Waste treatment, recycling and on normal trading terms if
Single point in time None On entry to facility
fees disposal service at disposal sites credit provided

Refund if event
Property hire and entry Use of halls and facilities Single point in time In full in advance cancelled within 7 On entry or at conclusion of hire
days
Refund for unused Output method Over 12 months matched
Memberships Gym and pool membership Over time Payment in full in advance
portion on application to access right
Output method based on provision of
Fees and charges for other Cemetery services, library fees,
Single point in time Payment in full in advance None service or completion of works
goods and services reinstatements and private works
In full in advance, on 30 day Refund for faulty
Sale of stock BRAC kiosk Single point in time Output method based on goods
credit goods
Commissions on licencing and
Commissions Over time Payment in full on sale None When assets are controlled
ticket sales
Payment in arrears for
Reimbursements Insurance claims Single point in time None When claim is agreed
claimable event

Consideration from contracts with customers is included in the transaction price.

Revenue Recognition

Revenue recognised during the year under each basis of recognition by nature or types of goods or services is provided in the table below:

For the year ended 30 June 2022

Contracts with Capital grant / Statutory
Nature or type customers Contributions Requirements Other Total
$ $ $ $ $
Rates 0 0 23,902,635 0 23,902,635
Operating grants, subsidies and contributions 3,135,938 145,110 0 0 3,281,048
Fees and charges 8,582,464 0 666,130 0 9,248,594
Interest earnings 0 0 256,212 163,035 419,247
Other revenue 8,834 0 0 980,967 989,801
Non-operating grants, subsidies and contributions 0 8,219,007 0 364,395 8,583,402
Total 11,727,236 8,364,117 24,824,977 1,508,397 46,424,727

For the year ended 30 June 2021

Contracts with Statutory
Nature or type customers Capital grant/contributions Requirements Other Total
$ $ $ $ $
Rates 0 0 23,282,829 0 23,282,829
Operating grants, subsidies and contributions 3,682,035 238,588 0 0 3,920,623
Fees and charges 9,098,994 0 612,979 0 9,711,973
Interest earnings 0 0 75,728 332,443 408,171
Other revenue 184,953 0 0 824,254 1,009,207
Non-operating grants, subsidies and contributions 0 22,903,196 0 3,980,174 26,883,370
Total 12,965,982 23,141,784 23,971,536 5,136,871 65,216,173

| 10
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

2. REVENUE AND EXPENSES (Continued)

2022 2022 2021
Note Actual Budget Actual
(a) Revenue (Continued) $ $ $

Assets and services acquired below fair value

Contributed assets 236,868 0 2,322,545
236,868 0 2,322,545

Interest earnings
Financial assets at amortised cost - self supporting loans 24,225 21,528 200
Interest on reserve funds 106,508 95,918 263,296
Rates instalment and penalty interest (refer Note 26(b)) 256,212 197,000 75,728
Other interest earnings 32,302 21,538 68,947
419,247 335,984 408,171
(b) Expenses

Auditors remuneration
- Audit of the Annual Financial Report 130,000 73,000 59,090
- Other assurance services 27,500 10,000 5,465
157,500 83,000 64,555

Finance costs
Borrowings 28(b) 118,453 122,688 90,774
Other provisions: unwinding of discount 16 123,854 0 48,023
242,307 122,688 138,797

Other expenditure
Impairment / (reversal of impairment) on trade and other receivables (193,511) 0 145,665
Sundry expenses 1,213,030 2,196,837 1,432,033
1,019,519 2,196,837 1,577,698

| 11
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

3. CASH AND CASH EQUIVALENTS Note 2022 2021

$ $
Cash at bank and on hand 43,413,804 44,065,529
Total cash and cash equivalents 18(a) 43,413,804 44,065,529

Held as
- Unrestricted cash and cash equivalents 7,357,686 9,199,005
- Restricted cash and cash equivalents 18(a) 36,056,118 34,866,524
43,413,804 44,065,529

SIGNIFICANT ACCOUNTING POLICIES

Cash and cash equivalents Restricted financial assets
Cash and cash equivalents include cash on hand, cash at bank, Restricted financial asset balances are not available for general use
deposits available on demand with banks and other short term by the local government due to externally imposed restrictions.
highly liquid investments with original maturities of three months Restrictions are specified in an agreement, contract or legislation.
or less that are readily convertible to known amounts of cash This applies to reserves, unspent grants, subsidies and contributions
and which are subject to an insignificant risk of changes in value. and unspent loans that have not been fully expended in the manner
specified by the contributor, legislation or loan agreement.
Bank overdrafts are reported as short term borrowings in current
liabilities in the statement of financial position.
Details of restrictions on financial assets can be found at Note 18.

4. OTHER FINANCIAL ASSETS 2022 2021

$ $

Non-current assets
Financial assets at amortised cost 1,250,000 1,250,000
Financial assets at fair value through profit and loss 97,255 92,259
1,347,255 1,342,259

Financial assets at amortised cost

Self supporting loans receivable 1,250,000 1,250,000
1,250,000 1,250,000

Financial assets at fair value through profit and loss

Units in Local Government House Trust 97,255 92,259
97,255 92,259

SIGNIFICANT ACCOUNTING POLICIES

Other financial assets at amortised cost Financial assets at fair value through profit and loss
The Shire classifies financial assets at amortised cost if both of The Shire classifies the following financial assets at fair value
the following criteria are met: through profit and loss:
- the asset is held within a business model whose objective is to - debt investments which do not qualify for measurement at either
collect the contractual cashflows, and amortised cost or fair value through other comprehensive income.
- the contractual terms give rise to cash flows that are solely - equity investments which the Shire has not elected to recognise
payments of principal and interest. fair value gains and losses through other comprehensive income.

Fair values of financial assets at amortised cost are not materially Impairment and risk
different to their carrying amounts, since the interest receivable Information regarding impairment and exposure to risk can be
on those assets is either close to current market rates or the found at Note 22.
assets are of a short term nature. Non-current financial assets at
amortised cost fair values are based on discounted cash flows using
a current market rates. They are classified as level 2 fair values in
the fair value hierachy (see Note 24 (i)) due to the observable
market rates.

Interest received is presented under cashflows from operating

activities in the Statement of Cash Flows where it is earned from
financial assets that are held for cash management purposes.

| 12
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

5. TRADE AND OTHER RECEIVABLES Note 2022 2021

$ $
Current
Rates receivable 908,254 1,008,322
Trade and other receivables 1,209,544 2,089,103
Accrued Income 0 (24,863)
Allowance for impairment - rates 22(b) (244,029) (241,258)
Allowance for impairment - sundry debtors 22(b) (10,663) (206,945)
ATO Receivable 152,615 477,007
2,015,721 3,101,366
Non-current
Pensioner's rates and ESL deferred 48,671 34,652
48,671 34,652

SIGNIFICANT ACCOUNTING POLICIES

Trade and other receivables Classification and subsequent measurement
Trade and other receivables include amounts due from Receivables which are generally due for settlement within
ratepayers for unpaid rates and service charges and 30 days except rates receivables which are expected to be
other amounts due from third parties for grants, collected within 12 months are classified as current assets.
contributions, reimbursements, and goods sold and All other receivables such as, deferred pensioner rates
services performed in the ordinary course of business. receivable after the end of the reporting period are
classified as non-current assets.
Trade and other receivables are recognised initially at the
amount of consideration that is unconditional, unless they Trade and other receivables are held with the objective
contain significant financing components, when they are to collect the contractual cashflows and therefore the Shire
recognised at fair value. measures them subsequently at amortised cost using
the effective interest rate method.
Impairment and risk exposure
Information about the impairment of trade receivables Due to the short term nature of current receivables, their
and their exposure to credit risk and interest rate risk carrying amount is considered to be the same as their
can be found in Note 22. fair value. Non-current receivables are indexed to
inflation, any difference between the face value and fair
value is considered immaterial.

| 13
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

6. INVENTORIES
Note 2022 2021
Current $ $
Fuel and materials 24,924 57,723
BRAC Stock 6,596 7,427
31,520 65,150

The following movements in inventories occurred during the year:

Balance at beginning of year 65,150 44,406

Inventories expensed during the year (238,252) (249,331)
Additions to inventory 204,622 270,075
Balance at end of year 31,520 65,150

SIGNIFICANT ACCOUNTING POLICIES

General
Inventories are measured at the lower of cost and net
realisable value.

Net realisable value is the estimated selling price in the

ordinary course of business less the estimated costs of
completion and the estimated costs necessary to make
the sale.

| 14
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

7. OTHER ASSETS
2022 2021
$ $
Other assets - current
Prepayments 218,779 214,067
Bonds and deposits held by others 7,161 1,800
Contract assets 0 14,386
225,940 230,253

SIGNIFICANT ACCOUNTING POLICIES

Other current assets
Other non-financial assets include prepayments which
represent payments in advance of receipt of goods or
services or that part of expenditure made in one
accounting period covering a term extending beyond
that period.

Contract assets
Contract assets primarily relate to the Shire's right to .
consideration for work completed but not billed at the end of
the period.

Impairment of assets associated with contracts with

customers are detailed at note 2 (b).

| 15
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

8. PROPERTY, PLANT AND EQUIPMENT

(a) Movements in Balances

Movement in the balances of each class of property, plant and equipment between the beginning and the end of the current financial year.

Land/vested Work in Total

in and under Buildings - Total land Furniture Work in Progress - property,
the control of non- and and Plant and Progress - Furniture & plant and
Note Council specialised buildings equipment equipment Buildings Equipment equipment
$ $ $ $ $ $ $ $
Balance at 1 July 2020 3,020,192 57,895,697 60,915,889 1,519,135 7,698,265 2,899,785 0 73,033,074
Additions* 0 8,023,002 8,023,002 117,219 1,120,984 192,324 43,074 9,496,603
Disposals 10(b) 0 (252,028) (252,028) 0 (392,634) 0 0 (644,662)
Depreciation 10(a) 0 (1,911,701) (1,911,701) (520,912) (1,650,293) 0 0 (4,082,906)
Transfers 0 2,899,785 2,899,785 0 0 (2,899,785) 0 0
Balance at 30 June 2021 3,020,192 66,654,755 69,674,947 1,115,442 6,776,322 192,324 43,074 77,802,109

Comprises:
Gross balance amount at 30 June 2021 3,020,192 73,815,100 76,835,292 2,495,876 13,191,577 192,324 43,074 92,758,143
Accumulated depreciation at 30 June 2021 0 (7,160,345) (7,160,345) (1,380,434) (6,415,255) 0 0 (14,956,034)
Balance at 30 June 2021 3,020,192 66,654,755 69,674,947 1,115,442 6,776,322 192,324 43,074 77,802,109
Additions* 0 523,751 523,751 593,689 988,670 1,738,277 16,686 3,861,073
Disposals 10(b) 0 0 0 (5,122) (259,884) 0 0 (265,006)

Revaluation increments / (decrements) transferred

to revaluation surplus 2,109,808 5,916,621 8,026,429 0 0 0 0 8,026,429

WIP reversal to expenses 0 0 0 0 0 0 (43,074) (43,074)

Depreciation 10(a) 0 (2,172,731) (2,172,731) (749,873) (1,538,316) 0 0 (4,460,920)
Transfers 0 145,154 145,154 1,131,039 3,135 (145,154) 0 1,134,174
Balance at 30 June 2022 5,130,000 71,067,550 76,197,550 2,085,175 5,969,927 1,785,447 16,686 86,054,785

Comprises:
Gross balance amount at 30 June 2022 5,130,000 71,067,550 76,197,550 4,211,693 13,745,057 1,785,447 16,686 95,956,433
Accumulated depreciation at 30 June 2022 0 0 0 (2,126,518) (7,775,130) 0 0 (9,901,648)
Balance at 30 June 2022 5,130,000 71,067,550 76,197,550 2,085,175 5,969,927 1,785,447 16,686 86,054,785

* Asset additions included additions received at substantially less than fair value:
During the year ended 30 June 2021 0 1,928,761 1,928,761 0 0 0 0 1,928,761
During the year ended 30 June 2022 0 0 0 0 236,868 0 0 236,868

| 16
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

8. PROPERTY, PLANT AND EQUIPMENT (Continued)

(b) Carrying Value Measurements

Fair Value Basis of Date of Last

Asset Class Hierarchy Valuation Technique Valuation Valuation Inputs Used
(i) Fair Value
Land and buildings
Market approach using recent Independent
Land/vested in and under the
2&3 observable market data for similar registered June 2022 Sales comparisons (level 2 and 3 inputs)
control of Council
properties valuer

Market approach using recent Independent Sales comparisons per lettable area (level 2 inputs),
Buildings - non-specialised 2&3 observable market data for similar registered June 2022 depreciated replacement cost per unit area and
properties valuer estimated useful life (Level 3 inputs)

Level 3 inputs are based on assumptions with regards to future values and patterns of consumption utilising current information. If the basis of these assumptions were varied,
they have the potential to result in a significantly higher or lower fair value measurement.

During the period there were no changes in the valuation techniques used by the local government to determine the fair value of property, plant and equipment using either
level 2 or level 3 inputs.

Following a change to Local Government (Financial Management) Regulation 17A, plant and equipment type assets (being plant and equipment and furniture and equipment)
are to be measured under the cost model, rather than at fair value. This change was effective from 1 July 2019 and represented a change in accounting policy.
Revaluations carried out previously were not reversed as it was deemed fair value approximated cost at the date of change.

| 17
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

9. INFRASTRUCTURE

(a) Movements in Balances

Movement in the balances of each class of infrastructure between the beginning and the end of the current financial year.

Works in Progress
- Roads,
Footpaths, Footpaths and Works in Works in Works in
Carparks & Infrastructure Bridges Progress - Progress - Other Progress - Rehabilitation Total
Note Roads Bridges Drainage Recreation Areas Others Infrastructure Drainage Infrastructure Recreation Areas Assets Infrastructure
$ $ $ $ $ $ $ $ $ $ $
Balance at 1 July 2020 199,217,223 38,109,448 32,391,767 10,457,147 15,530,198 2,904,842 47,863 660,522 6,005,028 4,802,000 310,126,038
Additions* 4,473,342 378,462 372,859 842,488 250,297 14,417,732 0 5,212,770 174,884 0 26,122,834
Impairment (losses) / reversals 0 0 0 0 0 0 0 0 0 (833,993) (833,993)
Depreciation 10(a) (4,171,245) (938,108) (710,286) (1,367,712) (653,454) 0 0 0 0 (601,628) (8,442,433)
Transfers 1,728,871 178,573 42,106 5,361,449 344,193 (1,907,444) (42,106) (344,193) (5,361,449) 0 0
Balance at 30 June 2021 201,248,191 37,728,375 32,096,446 15,293,372 15,471,234 15,415,130 5,757 5,529,099 818,463 3,366,379 326,972,446

Comprises:
Gross balance at 30 June 2021 259,327,870 40,447,276 34,187,890 18,944,933 17,002,775 15,415,130 5,757 5,529,099 818,463 3,366,379 395,045,572
Accumulated depreciation at 30 June 2021 (58,079,679) (2,718,901) (2,091,444) (3,651,561) (1,531,541) 0 0 0 0 0 (68,073,126)
Balance at 30 June 2021 201,248,191 37,728,375 32,096,446 15,293,372 15,471,234 15,415,130 5,757 5,529,099 818,463 3,366,379 326,972,446

Additions* 1,960,975 3,103,681 130,792 2,690,473 4,443,267 599,152 0 0 1,726,865 0 14,655,205

Revaluation increments / (decrements) transferred to
revaluation surplus 23,624 (18,713,163) 10,997,859 20,214,856 (2,702,911) 0 0 0 0 0 9,820,265
Revaluation (loss) / reversals transferred to profit or loss 0 0 0 0 (8,383,982) 0 0 0 0 0 (8,383,982)
WIP reversal to expenses 0 0 0 0 0 0 0 (1,980) (59,666) 0 (61,646)
Depreciation 10(a) (4,333,122) (1,049,256) (722,485) (1,847,813) (1,208,949) 0 0 0 0 (654,869) (9,816,494)
Transfers 5,073,711 3,629,183 211,943 2,426,610 9,231,182 (15,698,508) (5,757) (5,243,741) (758,797) 0 (1,134,174)
Balance at 30 June 2022 203,973,379 24,698,820 42,714,555 38,777,498 16,849,841 315,774 0 283,378 1,726,865 2,711,510 332,051,620

Comprises:
Gross balance at 30 June 2022 203,973,379 24,698,820 42,714,555 38,777,498 16,849,841 599,152 0 0 1,726,865 3,366,379 332,706,489
Accumulated depreciation at 30 June 2022 0 0 0 0 0 0 0 0 0 (654,869) (654,869)
Balance at 30 June 2022 203,973,379 24,698,820 42,714,555 38,777,498 16,849,841 599,152 0 0 1,726,865 2,711,510 332,051,620

* Asset additions included additions received at substantially less than fair value:
During the year ended 30 June 2021 366,419 0 0 0 27,365 0 0 0 0 0 393,784
During the year ended 30 June 2022 0 0 0 0 0 0 0 0 0 0 0

| 18
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

9. INFRASTRUCTURE (Continued)

(b) Carrying Value Measurements

Fair Value Date of Last

Asset Class Hierarchy Valuation Technique Basis of Valuation Valuation Inputs Used
(i) Fair Value
Construction costs and current condition (Level 2),
Cost approach using depreciated Independent registered
Roads 3 June 2022 residual values and remaining useful life
replacement cost valuer
assessments (Level 3) inputs

Construction costs and current condition (Level 2),

Cost approach using depreciated Independent registered
Footpaths, Carparks & Bridges 3 June 2022 residual values and remaining useful life
replacement cost valuer
assessments (Level 3) inputs

Construction costs and current condition (Level 2),

Cost approach using depreciated Independent registered
Drainage 3 June 2022 residual values and remaining useful life
replacement cost valuer
assessments (Level 3) inputs

Construction costs and current condition (Level 2),

Cost approach using depreciated Independent registered
Recreation Areas 3 June 2022 residual values and remaining useful life
replacement cost valuer
assessments (Level 3) inputs

Construction costs and current condition (Level 2),

Cost approach using depreciated Independent registered
Infrastructure Others 3 June 2022 residual values and remaining useful life
replacement cost valuer
assessments (Level 3) inputs

Level 3 inputs are based on assumptions with regards to future values and patterns of consumption utilising current information. If the basis of these assumptions were varied, they
have the potential to result in a significantly higher or lower fair value measurement.

During the period there were no changes in the valuation techniques used to determine the fair value of infrastructure using level 3 inputs.

| 19
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

10. FIXED ASSETS

(a) Depreciation 2022 2022 2021

Note Actual Budget Actual
$ $ $
Buildings - non-specialised 8(a) 2,172,731 345,751 1,911,701
Furniture and equipment 8(a) 749,873 10,402 520,912
Plant and equipment 8(a) 1,538,316 4,585,659 1,650,293
Roads 9(a) 4,333,122 5,588,387 4,171,245
Footpaths, Carparks & Bridges 9(a) 1,049,256 0 938,108
Drainage 9(a) 722,485 719,093 710,286
Recreation Areas 9(a) 1,847,813 1,313,858 1,367,712
Infrastructure Others 9(a) 1,208,949 65,984 653,454
Rehabilitation Assets 9(a) 654,869 0 601,628
14,277,414 12,629,134 12,525,339

Assets Useful Life

Typical estimated useful lives for the different asset classes for the current and prior years are included in the table below:

Asset Class Estimated

Major depreciation periods used for each class of depreciable asset are: Useful Life
Buildings 13-100 years
Furniture and equipment 4-10 years
Plant and equipment 4-16 years
Roads 10-250 years
Footpaths, Carparks & Bridges 15-250 years
Drainage 50-80 years
Recreation Areas 5-75 years
Infrastructure Others 4-100 years

| 20
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

10. FIXED ASSETS (Continued)

(b) Disposals of assets

2022 2022 2022 2022 2021 2021
Actual Actual 2022 2022 Budget Budget 2022 2022 Actual Actual 2021 2021
Net Book Sale Actual Actual Net Book Sale Budget Budget Net Book Sale Actual Actual
Value Proceeds Profit Loss Value Proceeds Profit Loss Value Proceeds Profit Loss
$ $ $ $ $ $ $ $ $ $ $ $
Buildings - non-specialised 0 0 0 0 0 0 0 0 252,028 0 0 (252,028)
Furniture and equipment 5,122 0 0 (5,122) 0 0 0 0 0 0 0 0
Plant and equipment 259,884 251,046 34,267 (43,105) 759,387 694,000 100,568 (165,955) 392,634 219,715 11,822 (184,741)
265,006 251,046 34,267 (48,227) 759,387 694,000 100,568 (165,955) 644,662 219,715 11,822 (436,769)

The following assets were disposed of during the year.

2022 2022
Actual Actual 2022 2022
Net Book Sale Actual Actual
Plant and Equipment Value Proceeds Profit Loss
Other property and services
Bibliotheca RFID Library
Systems - Smartserve 200 5,122 0 0 (5,122)
Tabletop Kiosk
Holden Colorado Parks 21,698 26,700 5,002 0
Trailer Dean No 17 Flatbed
0 1,062 1,062 0
Tilting
Holden Colorado (MRHS) 21,701 28,600 6,899 0
Trailer Caged Tipper Tandem 3,000 2,682 0 (318)
Trailer - Variable Message
19,798 235 0 (19,563)
Display
Toyota Prado DSL 42,649 50,761 8,112 0
Truck - Prime Mover Hino 700
60,926 50,000 0 (10,926)
series
Toro Ground Master 360 4WD 17,550 13,500 0 (4,050)
Dean No17 Single Axel Tilt Flat
9,949 1,701 0 (8,248)
Bed
Trailer Dean No 17 Flatbed
0 1,260 1,260 0
Tilting
Hino 500 series 2630 Medium
62,613 74,545 11,932 0
Auto Tip
265,006 251,046 34,267 (48,227)

| 21
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

10. FIXED ASSETS (Continued)

SIGNIFICANT ACCOUNTING POLICIES

Fixed assets Revaluation (continued)
Each class of fixed assets within either property, plant and equipment For property, plant and equipment and infrastructure, increases in
or infrastructure, is carried at cost or fair value as indicated less, the carrying amount arising on revaluation of assets are credited
where applicable, any accumulated depreciation and impairment to a revaluation surplus in equity. Decreases that offset previous
losses. increases of the same class of asset are recognised against
revaluation surplus directly in equity. All other decreases are
Initial recognition and measurement for assets held at cost recognised in profit or loss. Subsequent increases are
Plant and equipment including furniture and equipment is then recognised in profit or loss to the extent they reverse a
recognised at cost on acquisition in accordance with Financial net revaluation decrease previously recognised in profit or loss
Management Regulation 17A. Where acquired at no cost the asset for the same class of asset.
is initially recognised at fair value. Assets held at cost are
depreciated and assessed for indicators of impairment annually. Depreciation
The depreciable amount of all property, plant and equipment
Initial recognition and measurement between and infrastructure, are depreciated on a straight-line
mandatory revaluation dates for assets held at fair value basis over the individual asset’s useful life from the time the
Assets for which the fair value as at the date of acquisition is under asset is held ready for use. Leasehold improvements are
$5,000 are not recognised as an asset in accordance with depreciated over the shorter of either the unexpired period
Financial Management Regulation 17A (5). These assets are of the lease or the estimated useful life of the improvements.
expensed immediately.
The assets residual values and useful lives are reviewed, and
Where multiple individual low value assets are purchased together adjusted if appropriate, at the end of each reporting period.
as part of a larger asset or collectively forming a larger asset
exceeding the threshold, the individual assets are recognised as An asset's carrying amount is written down immediately to its
one asset and capitalised. recoverable amount if the asset's carrying amount is greater
than its estimated recoverable amount.
In relation to this initial measurement, cost is determined as the fair
value of the assets given as consideration plus costs incidental to Gains and losses on disposals are determined by
the acquisition. For assets acquired at zero cost or otherwise comparing proceeds with the carrying amount. These
significantly less than fair value, cost is determined as fair value at gains and losses are included in the statement of
the date of acquisition. The cost of non-current assets constructed comprehensive income in the period in which they arise.
by the Shire includes the cost of all materials used in construction,
direct labour on the project and an appropriate proportion of variable Depreciation on revaluation
and fixed overheads. When an item of property, plant and equipment and
infrastructure is revalued, any accumulated depreciation
Individual assets that are land, buildings, infrastructure and at the date of the revaluation is treated in one of the
investment properties acquired between scheduled revaluation following ways:
dates of the asset class in accordance with the (i) The gross carrying amount is adjusted in a manner
mandatory measurement framework, are recognised at cost that is consistent with the revaluation of the carrying
and disclosed as being at fair value as management believes cost amount of the asset. For example, the gross carrying
approximates fair value. They are subject to subsequent revaluation amount may be restated by reference to observable
at the next revaluation date in accordance with the mandatory market data or it may be restated proportionately to the
measurement framework. change in the carrying amount. The accumulated
depreciation at the date of the revaluation is adjusted
Revaluation to equal the difference between the gross carrying
The fair value of land, buildings, infrastructure and investment amount and the carrying amount of the asset after
properties is determined at least every five years in accordance taking into account accumulated impairment losses; or
with the regulatory framework. This includes buildings and (ii) Eliminated against the gross carrying amount of the
infrastructure items which were pre-existing improvements asset and the net amount restated to the revalued
(i.e. vested improvements) on vested land acquired by the Shire. amount of the asset.

At the end of each period the carrying amount for each asset class Amortisation
is reviewed and where appropriate the fair value is updated to All intangible assets with a finite useful life, are amortised
reflect current market conditions. This process is considered to be on a straight-line basis over the individual asset’s useful life
in accordance with Local Government (Financial Management) from the time the asset is held ready for use.
Regulation 17A (2) which requires land, buildings, infrastructure,
investment properties and vested improvements to be shown at The residual value of intangible assets is considered to be
fair value. zero and the useful life and amortisation method are
reviewed at the end of each financial year.

Amortisation is included within depreciation in the

Statement of Comprehensive Income and in Note 10(a).

| 22
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

11 LEASES

(a) Lessor - Property, Plant and Equipment Subject to Lease

2022 2021
Actual Actual
The table below represents a maturity analysis of the undiscounted $ $
lease payments to be received after the reporting date.
Less than 1 year 1,622,216 1,433,394
1 to 2 years 1,246,449 1,328,478
2 to 3 years 1,154,615 1,239,925
3 to 4 years 888,483 1,148,091
4 to 5 years 795,274 881,959
> 5 years 6,950,110 7,790,833
12,657,147 13,822,680

The Shire leases houses to staff with rentals payable monthly. These leases are classified as operating
leases as they do not transfer substantially all of the risks and rewards incidental to the ownership of the assets.
The staff houses are not considered investment property as they are leased for use in the supply of services
to the community.

Lease payments for some contracts include CPI increases, but there are no other variable lease
payments that depend on an index or rate. Although the Shire is exposed to changes in the
residual value at the end of the current leases, the Shire typically enters into new operating leases and
therefore will not immediately realise any reduction in residual value at the end of these leases.
Expectations about the future residual values are reflected in the fair value of the properties.

SIGNIFICANT ACCOUNTING POLICIES

The Shire as Lessor
Upon entering into each contract as a lessor, the Shire assesses Initial direct costs incurred in entering into an operating
if the lease is a finance or operating lease. lease (eg legal cost, cost to setup) are included in the
carrying amount of the leased asset and recognised as an
The contract is classified as a finance lease when the terms expense on a straight-line basis over the lease term.
of the lease transfer substantially all the risks and rewards of
ownership to the lessee. All other leases not within this definition When a contract is determined to include lease and
are classified as operating leases. Rental income received from non-lease components, the Shire applies AASB 15 to
operating leases is recognised on a straight-line basis over the allocate the consideration under the contract to each
term of the specific lease. component.

| 23
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

12 TRADE AND OTHER PAYABLES 2022 2021

$ $
Current
Sundry creditors 3,681,408 5,659,954
Prepaid rates 522,122 417,615
Accrued salaries and wages 114,143 517,271
Bonds and deposits held 635,329 633,957
Accrued and other liabilities 871,125 112,281
5,824,127 7,341,078

SIGNIFICANT ACCOUNTING POLICIES

Financial liabilities Trade and other payables
Financial liabilities are initially recognised at fair value Trade and other payables represent liabilities for goods
when the Shire becomes a party to the contractual and services provided to the Shire prior to the end of the
provisions of the instrument. financial year that are unpaid and arise when the Shire
becomes obliged to make future payments in respect
Non-derivative financial liabilities (excluding financial of the purchase of these goods and services.
guarantees) are subsequently measured at amortised The amounts are unsecured, are recognised as a
cost. current liability and are usually paid within 30 days of
recognition. The carrying amounts of trade and other
Financial liabilities are derecognised where the related payables are considered to be the same as their fair
obligations are discharged, cancelled or expired. The values, due to their short-term nature.
difference between the carrying amount of the financial
liability extinguished or transferred to another party and Prepaid rates
the fair value of the consideration paid, including the Prepaid rates are, until the taxable event has occurred
transfer of non-cash assets or liabilities assumed, is (start of the next financial year), refundable at the request
recognised in profit or loss. of the ratepayer. Rates received in advance are initially
recognised as a financial liability. When the taxable event
occurs, the financial liability is extinguished and the Shire
recognises revenue for the prepaid rates that have not been
refunded.

| 24
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

13. OTHER LIABILITIES 2022 2021

$ $
Current
Contract liabilities 265,314 393,309
Capital Grant Liability 2,363,454 2,598,395
Developer Contributions 1,701,173 2,185,128
4,329,941 5,176,832
Reconciliation of changes in contract liabilities
Opening balance 2,991,704 7,534,020
Additions 2,517,336 2,991,704
Revenue from contracts with customers included as a contract liability at the
start of the period (2,880,272) (7,534,020)
2,628,768 2,991,704

The Shire expects to satisfy the performance obligations from contracts with
customers unsatisfied at the end of the reporting period to be satisfied within
the next 12 months.

Performance obligations in relation to capital grant/contribution liabilities are satisfied

as project milestones are met or completion of construction or acquisition of the asset.

SIGNIFICANT ACCOUNTING POLICIES

Contract liabilities Capital grant/contribution liabilities
Contract liabilities represent the Shire's obligation to Capital grant/contribution liabilities represent the Shire's
transfer goods or services to a customer for which the obligations to construct recognisable non-financial
Shire has received consideration from the customer. assets to identified specifications to be controlled the
Shire which are yet to be satisfied. Capital grant/contribution
Contract liabilities represent obligations which are not liabilities are recognised as revenue when the
yet satisfied. Contract liabilities are recognised as revenue obligations in the contract are satisfied.
when the performance obligations in the contract are satisfied.
Non-current capital grant/contribution liabilities fair values are
based on discounted cash flows of expected cashflows to satisfy
the obligations using a current borrowing rate. They are classified
as level 3 fair values in the fair value hierachy (see Note 24(i))
due to the unobservable inputs, including own credit risk.

| 25
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

14. BORROWINGS
2022 2021
Note Current Non-current Total Current Non-current Total
Secured $ $ $ $ $ $
WATC 444,162 6,786,745 7,230,907 859,957 5,430,907 6,290,864
Total secured borrowings 28(a) 444,162 6,786,745 7,230,907 859,957 5,430,907 6,290,864

* WA Treasury Corporation

SIGNIFICANT ACCOUNTING POLICIES

Borrowing costs Risk
Borrowing costs are recognised as an expense when incurred except Information regarding exposure to risk can
where they are directly attributable to the acquisition, construction or be found at Note 22.
production of a qualifying asset. Where this is the case, they are Details of individual borrowings required by regulations
capitalised as part of the cost of the particular asset until such time are provided at Note 28(a).
as the asset is substantially ready for its intended use or sale.

Fair values of borrowings are not materiallly different to their carrying

amounts, since the interest payable on those borrowings is either close to
current market rates or the borrowings are of a short term nature.
Borrowings fair values are based on discounted cash flows
using a current borrowing rate. They are classified as level 3 fair values in
the fair value hierachy (see Note 24(i)) due to the unobservable inputs,
including own credit risk.

| 26
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

15. EMPLOYEE RELATED PROVISIONS

Employee Related Provisions

2022 2021
Current provisions $ $
Employee benefit provisions
Annual Leave 1,574,784 1,407,323
Long Service Leave 1,209,092 837,144
2,783,876 2,244,467
Non-current provisions
Long Service Leave 267,558 193,039
267,558 193,039

3,051,434 2,437,506

Provision is made for benefits accruing to employees in respect of wages and salaries, annual leave
and long service leave and associated on costs for services rendered up to the reporting date and
recorded as an expense during the period the services are delivered.

Annual leave liabilities are classified as current, as there is no unconditional right to defer settlement
for at least 12 months after the end of the reporting period. Assessments indicate that
actual settlement of the liabilities is expected to occur as follows:

Note 2022 2021

Amounts are expected to be settled on the following basis: $ $
Less than 12 months after the reporting date 1,535,484 1,256,407
More than 12 months from reporting date 1,515,950 1,181,099
3,051,434 2,437,506

SIGNIFICANT ACCOUNTING POLICIES

Employee benefits
The Shire’s obligations for employees’ annual leave, long Other long-term employee benefits
service leave and other employee leave entitlements are Long-term employee benefits provisions are measured at the
recognised as employee related provisions in the Statement present value of the expected future payments to be made to
of Financial Position. employees. Expected future payments incorporate
anticipated future wage and salary levels, durations of
Short-term employee benefits service and employee departures and are discounted at
Provision is made for the Shire’s obligations for short-term rates determined by reference to market yields at the end
employee benefits. Short-term employee benefits are of the reporting period on government bonds that have
benefits (other than termination benefits) that are expected maturity dates that approximate the terms of the obligations.
to be settled wholly before 12 months after the end of the Any remeasurements for changes in assumptions of
annual reporting period in which the employees render the obligations for other long-term employee benefits are
related service, including wages, salaries and sick leave. recognised in profit or loss in the periods in which the
Short-term employee benefits are measured at the changes occur.
(undiscounted) amounts expected to be paid when the
obligation is settled. The Shire’s obligations for long-term employee benefits are
presented as non-current provisions in its statement of
The Shire’s obligations for short-term employee benefits financial position, except where the Shire does not have an
such as wages, salaries and sick leave are recognised as unconditional right to defer settlement for at least 12 months
a part of current trade and other payables in the statement after the end of the reporting period, in which case the
of financial position. obligations are presented as current provisions.

| 27
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

16. OTHER PROVISIONS

Provision for
remediation
Note costs Total
$ $
Opening balance at 1 July 2021
Current provisions 700,158 700,158
Non-current provisions 2,483,767 2,483,767
3,183,925 3,183,925

Amounts used (118,562) (118,562)

Charged to profit or loss
- unwinding of discount 2(b) 123,854 123,854
Balance at 30 June 2022 3,189,217 3,189,217

Comprises
Current 91,147 91,147
Non-current 3,098,070 3,098,070
3,189,217 3,189,217

Other provisions
Amounts which are reliably expected to be paid out within 12 months of the reporting date
are classified as current. Exact timing of payment of non-current obligations is unable
to be reliably estimated as it is dependent on factors beyond the control of the local government.

Provision for remediation costs

Shire of Broome recognised the future be required to settle the liability in the
remediation liability for the waste normal course of business as per
management facility in the statement of AASB 137. The restoration obligation has
financial position as it is probable that an been estimated by an independent industry
outflow of obligation is certain and the professional and the present value of the
amount at which the settlement will take future restoration costs is to be reviewed
place can be measured reliably. The liability annually and any changes in the estimate
is reported at the present value of the future are to be reflected in the restoration provision
net cash outflows that are expected to at each reporting date.

Provisions
Provisions are recognised when the Shire has a present
legal or constructive obligation, as a result of past events,
for which it is probable that an outflow of economic benefits
will result and that outflow can be reliably measured.

Provisions are measured using the best estimate of the

amounts required to settle the obligation at the end of the
reporting period.

| 28
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

17. REVALUATION SURPLUS

2022 2022 2022 Total 2022 2021 2021 Total 2021

Opening Revaluation Revaluation Movement on Closing Opening Change in Movement on Closing
Balance Increment (Decrement) Revaluation Balance Balance Accounting Estimate Revaluation Balance
$ $ $ $ $ $ $ $ $
Revaluation surplus - Land and Buildings 18,776,908 8,026,429 0 8,026,429 26,803,337 18,776,908 0 0 18,776,908
Revaluation surplus - Furniture and equipment 201,314 0 0 0 201,314 201,314 0 0 201,314
Revaluation surplus - Roads 148,062,212 23,624 0 23,624 148,085,836 148,062,212 0 0 148,062,212
Revaluation surplus - Footpaths, Carparks & Bridges 30,512,688 0 (18,713,162) (18,713,162) 11,799,526 30,512,688 0 0 30,512,688
Revaluation surplus - Drainage 27,400,598 10,997,860 0 10,997,860 38,398,458 27,400,598 0 0 27,400,598
Revaluation surplus - Recreation Areas 8,014,788 20,214,857 0 20,214,857 28,229,645 8,014,788 0 0 8,014,788
Revaluation surplus - Infrastructure Others 2,702,911 0 (2,702,911) (2,702,911) 0 2,101,283 601,628 601,628 2,702,911
235,671,419 39,262,770 (21,416,073) 17,846,697 253,518,116 235,069,791 601,628 601,628 235,671,419

Movements on revaluation of property, plant and equipment (including infrastructure) are not able to be reliably attributed to a program as the assets were revalued by class as provided for by AASB 116 Aus 40.1.

| 29
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

18. NOTES TO THE STATEMENT OF CASH FLOWS

(a) Reconciliation of Cash

For the purposes of the Statement of Cash Flows, cash includes cash and cash equivalents,
net of outstanding bank overdrafts. Cash at the end of the reporting period is reconciled to the
related items in the Statement of Financial Position as follows:

2022 2022 2021

Note Actual Budget Actual
$ $ $

Cash and cash equivalents 3 43,413,804 37,264,767 44,065,529

Restrictions
The following classes of financial assets have restrictions imposed
by regulations or other externally imposed requirements which
limit or direct the purpose for which the resources may be used:

- Cash and cash equivalents 3 36,056,118 28,348,140 34,866,524

36,056,118 28,348,140 34,866,524

The restricted financial assets are a result of the following specific

purposes to which the assets may be used:
Restricted reserve accounts 29 32,792,021 28,348,140 30,846,263
Contract & capital grant liabilities from contracts with customers 13 2,628,768 0 2,991,704
Bonds and deposits held 12 635,329 0 633,957
Other Restricted Cash 0 0 394,600
Total restricted financial assets 36,056,118 28,348,140 34,866,524

(b) Reconciliation of Net Result to Net Cash Provided

By Operating Activities

Net result (5,466,566) 2,223,935 23,205,131

Non-cash items:
Depreciation/amortisation 14,277,414 12,629,134 12,525,339
(Profit)/loss on sale of asset 13,960 65,387 424,947
Loss on revaluation of fixed assets 8,383,982 0 0
Assets received for substantially less than fair value (236,868) 0 0
Reversal of WIP to operating expenses 104,720
Changes in assets and liabilities:
(Increase)/decrease in trade and other receivables 1,071,626 0 3,057,250
(Increase)/decrease in other assets (10,074) 0 (111,064)
(Increase)/decrease in inventories 33,630 0 (20,744)
(Increase)/decrease in contract assets 14,386 0 (14,386)
Increase/(decrease) in trade and other payables (1,516,951) 0 997,807
Increase/(decrease) in employee related provisions 613,928 0 (222,919)
Increase/(decrease) in other provisions 123,854 700,158 (61,337)
Increase/(decrease) in other liabilities (846,891) 0 (4,698,995)
(Increase)/decrease in Units in LG Housing Trust (4,996) 0 (3,233)
Non-operating grants, subsidies and contributions (8,470,383) (8,926,384) (22,184,375)
Net cash provided by/(used in) operating activities 8,084,771 6,692,230 12,893,421

(c) Undrawn Borrowing Facilities

Credit Standby Arrangements
Bank overdraft limit 700,000 700,000
Bank overdraft at balance date 0 0
Credit card limit 100,000 60,000
Credit card balance at balance date 0 0
Total amount of credit unused 800,000 760,000

Loan facilities
Loan facilities - current 444,162 859,957
Loan facilities - non-current 6,786,745 5,430,907
Total facilities in use at balance date 7,230,907 6,290,864

Unused loan facilities at balance date 0 0

| 30
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

19. CONTINGENT LIABILITIES

In relation to land owned, vested or leased the Shire of Broome has identified the following sites where there may be
possible sources of contamination. At the date of this report the Shire is yet to conduct investigations to ascertain the
value and timing of remediation works.

1. 20 Cable Beach Rd, Djugun, 6725, Landfill, Crown Reserve 42502, Cable Beach Road, Broome.
2. 8 Napier Tce, Broome, 6725, Former Landfill, Crown Reserve 8176 (Lot 1317) Napier Terrace, Broome.
3. 317 Kavite Rd, Minyirr, 6725, Broome Turf Club, Crown Reserve 22648, 317 Kavite Road Cnr Gantheaume Point
Road. Broome.
4. 197 Port Dr, Minyirr, 6725, Broome Golf Course, Crown Reserve 29300, Port Drive, Broome (Source Site)
5. 223 Port Drive, Minyirr, 6725, Broome Golf Course, Crown Reserve 29300, Port Drive, Broome (Source Site)
6. 73 Wattle Dr, Roebuck, 6725, Former Landfill, Crown Reserve 30803, Lot 73 Wattle Drive, Broome.

20. CAPITAL COMMITMENTS

(a) Capital Expenditure Commitments 2022 2021

$ $
Contracted for:
- capital expenditure projects 3,479,069 2,298,615
- plant & equipment purchases 1,410,313 218,968
4,889,382 2,517,583
Payable:
- not later than one year 4,889,382 2,517,583

| 31
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022
21. RELATED PARTY TRANSACTIONS
2022 2022 2021
(a) Elected Member Remuneration Note Actual Budget Actual
$ $ $
Cr Harold Tracey
President's annual allowance 47,515 47,515 47,515
Meeting attendance fees 23,361 23,361 23,361
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
74,426 74,426 74,426
Cr Desiree Male
Deputy President's annual allowance 11,879 11,879 11,879
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
32,852 32,852 32,852
Cr Chris Mitchell JP
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
20,973 20,973 20,973
Cr Bruce Rudeforth Jnr
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
20,973 20,973 20,973
Cr Peter Taylor
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
20,973 20,973 20,973
Cr Nik Wevers
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
20,973 20,973 20,973
Cr Fiona West
Meeting attendance fees 5,808 17,423 17,423
Annual allowance for ICT expenses 1,167 3,500 3,500
Annual allowance for travel and accommodation expenses 17 50 50
6,991 20,973 20,973
Cr Elsta Foy
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
20,973 20,973 20,973
Cr Philip Matsumoto
Meeting attendance fees 17,423 17,423 17,423
Annual allowance for ICT expenses 3,500 3,500 3,500
Annual allowance for travel and accommodation expenses 50 50 50
20,973 20,973 20,973

240,107 254,089 254,089

Fees, expenses and allowances to be paid or 2022 2022 2021
reimbursed to elected council members. Actual Budget Actual
$ $ $
President's annual allowance 47,515 47,515 47,515
Deputy President's annual allowance 11,879 11,879 11,879
Meeting attendance fees 151,130 162,745 162,745
Annual allowance for ICT expenses 29,167 31,500 31,500
Annual allowance for travel and accommodation expenses 417 450 450
21(b) 240,107 254,089 254,089

(b) Key Management Personnel (KMP) Compensation

2022 2021
The total of compensation paid to KMP of the Actual Actual
Shire during the year are as follows: $ $

Short-term employee benefits 938,462 918,166

Post-employment benefits 88,217 80,696
Employee - other long-term benefits 64,558 67,403
Employee - termination benefits 0 2,203
Council member costs 21(a) 240,107 254,089
1,331,344 1,322,556

Short-term employee benefits

These amounts include all salary and fringe benefits awarded to KMP except for details in
respect to fees and benefits paid to council members which may be separately found in the table above.
Post-employment benefits
These amounts are the current-year's cost of the Shire's superannuation contributions
made during the year.
Other long-term benefits
These amounts represent annual leave and long service leave entitlements accruing during the year.

Termination benefits
These amounts represent termination benefits paid to KMP (Note: may or may not be applicable in any given year).
Council member costs
These amounts represent payments of member fees, expenses, allowances and reimbursements during the year.

| 32
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

21. RELATED PARTY TRANSACTIONS

(c) Transactions with related parties

Transactions between related parties and the Shire are on normal commercial terms and conditions,
no more favourable than those available to other parties, unless otherwise stated.

No outstanding balances or provisions for doubtful debts or guarantees exist in relation to related parties at year end.

In addition to KMP compensation above the following transactions 2022 2021

occurred with related parties: Actual Actual
$ $
Sale of goods and services 162,609 186,549
Purchase of goods and services 22,691 357,037

(d) Related Parties

The Shire's main related parties are as follows:

i. Key management personnel

Any person(s) having authority and responsibility for planning, directing and controlling the activities of the
entity, directly or indirectly, including any council member, are considered key management personnel.

ii. Other Related Parties

An associate person of KMP was employed by the Shire under normal employment terms and conditions.

Any entity that is controlled by or over which KMP, or close family members of KMP, have authority and
responsibility for planning, directing and controlling the activity of the entity, directly or indirectly,
are considered related parties in relation to the Shire.

iii. Entities subject to significant influence by the Shire

An entity that has the power to participate in the financial and operating policy decisions of an entity, but does
not have control over those policies, is an entity which holds significant influence.
Significant influence may be gained by share ownership, statute or agreement.

| 33
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

22. FINANCIAL RISK MANAGEMENT

This note explains the Shire’s exposure to financial risks and how these risks could affect the Shire’s future financial
performance.

Risk Exposure arising from Measurement Management

Long term borrowings at variable Sensitivity Utilise fixed interest rate
Market risk - interest rates
rates analysis borrowings
Cash and cash equivalents, trade Aging analysis Diversification of bank deposits,
Credit risk receivables, financial assets and Credit analysis credit limits. Investment policy
debt investments

Borrowings and other liabilities Rolling cash Availability of committed credit

Liquidity risk
flow forecasts lines and borrowing facilities

The Shire does not engage in transactions expressed in foreign currencies and is therefore not subject to foreign currency risk.

Financial risk management is carried out by the finance area under policies approved by the Council. The finance
area identifies, evaluates and manages financial risks in close co-operation with the operating divisions. Council have
approved the overall risk management policy and provide policies on specific areas such as investment policy.

(a) Interest rate risk

Cash and cash equivalents

The Shire's main interest rate risk arises from cash and cash equivalents with variable interest rates, which exposes the
Shire to cash flow interest rate risk. Short term overdraft facilities also have variable interest rates however these are
repaid within 12 months, reducing the risk level to minimal.

Excess cash and cash equivalents are invested in fixed interest rate term deposits which do not expose the Shire to cash
flow interest rate risk. Cash and cash equivalents required for working capital are held in variable interest rate accounts
and non-interest bearing accounts. Carrying amounts of cash and cash equivalents at the 30 June and the weighted average
interest rate across all cash and cash equivalents, term deposits, and Treasury bonds held disclosed as financial assets at
amortised cost are reflected in the table below.
Weighted
Average Carrying Fixed Variable Non Interest
Interest Rate Amounts Interest Rate Interest Rate Bearing
% $ $ $ $
2022
Cash and cash equivalents 0.96% 43,413,804 0 43,409,604 4,200

2021
Cash and cash equivalents 0.93% 44,065,529 0 44,061,129 4,400

Sensitivity
Profit or loss is sensitive to higher/lower interest income from cash and cash equivalents as a result of changes in
interest rates.
2022 2021
$ $
Impact of a 1% movement in interest rates on profit and loss and equity* 434,096 440,611
* Holding all other variables constant
Borrowings
Borrowings are subject to interest rate risk - the risk that movements in interest rates could adversely affect funding costs.
The Shire manages this risk by borrowing long term and fixing the interest rate to the situation considered the most
advantageous at the time of negotiation. The Shire does not consider there to be any interest rate risk in relation to borrowings.
Details of interest rates applicable to each borrowing may be found at Note 28(a).

| 34
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

22. FINANCIAL RISK MANAGEMENT (Continued)

(b) Credit risk

Trade and Other Receivables

The Shire’s major receivables comprise rates annual charges and user fees and charges. The major risk associated with these
receivables is credit risk – the risk that the debts may not be repaid. The Shire manages this risk by monitoring outstanding
debt and employing debt recovery policies. It also encourages ratepayers to pay rates by the due date through incentives.

Credit risk on rates and annual charges is minimised by the ability of the Shire to recover these debts as a secured charge
over the land, that is, the land can be sold to recover the debt. The Shire is able to charge interest on overdue rates and annual
charges at higher than market rates, which further encourages payment.

The level of outstanding receivables is reported to Council monthly and benchmarks are set and monitored for acceptable
collection performance.

The Shire applies the AASB 9 simplified approach to measuring expected credit losses using a lifetime expected loss
allowance for all trade receivables. To measure the expected credit losses, rates receivable are separated from other
trade receivables due to the difference in payment terms and security for rates receivable.

The expected loss rates are based on the payment profiles of rates and fees and charges over a period of 36 months before
1 July 2021 or 1 July 2022 respectively and the corresponding historical losses experienced within this period. Historical credit
loss rates are adjusted to reflect current and forward-looking information on macroeconomic factors such as the ability of
ratepayers and residents to settle the receivables. Housing prices and unemployment rates have been identified as the most
relevant factor in repayment rates, and accordingly adjustments are made to the expected credit loss rate based on these factors.

The loss allowance as at 30 June 2022 and 30 June 2021 for rates receivable was determined as follows:

Less than 1 More than 1 More than 2 More than 3 Specific

year past due year past due years past due years past due provision Total Note
30 June 2022
Rates receivable
Expected credit loss 2% 5% 8% 10%
Gross carrying amount 20,011 499,644 80,115 106,941 201,544 908,254
Loss allowance 400 24,982 6,409 10,694 201,544 244,029 5

30 June 2021
Rates receivable
Expected credit loss 2% 5% 8% 10%
Gross carrying amount 22,028 560,555 123,785 110,074 191,880 1,008,322
Loss allowance 441 28,028 9,903 11,006 191,880 241,258 5

The loss allowance as at 30 June 2022 and 30 June 2021 was determined as follows for trade receivables.

Less than 1 More than 30 More than 60 More than 90 Specific

year past due days past due days past due days past due provision Total
30 June 2022
Trade and other receivables
Expected credit loss 2% 5% 10% 15%
Gross carrying amount 859,224 113,548 77,574 153,504 5,693 1,209,544
Loss allowance 328 284 776 3,582 5,693 10,663 5

30 June 2021
Trade and other receivables
Expected credit loss 2% 5% 10% 15%
Gross carrying amount 1,588,315 70,903 49,015 251,927 128,943 2,089,103
Loss allowance 31,766 3,545 4,902 37,789 128,943 206,945 5

| 35
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

22. FINANCIAL RISK MANAGEMENT (Continued)

(b) Credit risk

The loss allowances for trade receivables and contract assets as at 30 June reconcile to the opening loss allowances as follows:
Rates receivable Trade and other receivables
2022 2021 2022 2021
Actual Actual Actual Actual
$ $ $ $
Opening loss allowance as at 1 July 241,258 167,704 206,945 134,834
Increase in loss allowance recognised in
profit or loss during the year 2,771 73,554 0 72,111
Unused amount reversed 0 0 (196,282) 0
Closing loss allowance at 30 June 244,029 241,258 10,663 206,945

Trade receivables and contract assets are written off where there is no reasonable expectation of recovery. Indicators
that there is no reasonable expectation of recovery include, amongst others, the failure of a debtor to engage
in a repayment plan with the Shire, and a failure to make contractual payments for a period of greater than 120 days past due.

Impairment losses on trade receivables and contract assets are presented as net impairment losses within operating profit.
Subsequent recoveries of amounts previously written off are credited against the same line item.

| 36
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

22. FINANCIAL RISK MANAGEMENT (Continued)

(c) Liquidity risk

Payables and borrowings

Payables and borrowings are both subject to liquidity risk – that is the risk that insufficient funds may be
on hand to meet payment obligations as and when they fall due. The Shire manages this risk by monitoring
its cash flow requirements and liquidity levels and maintaining an adequate cash buffer. Payment terms
can be extended and overdraft facilities drawn upon if required and disclosed in Note 18(c).

The contractual undiscounted cash flows of the Shire’s payables and borrowings are set out in the
liquidity table below. Balances due within 12 months equal their carrying balances, as the impact
of discounting is not significant.

Due Due Due Total

within between after contractual Carrying
1 year 1 & 5 years 5 years cash flows values Note
2022 $ $ $ $ $

Trade and other payables 5,824,127 0 0 5,824,127 5,824,127 12

Borrowings 444,162 2,868,897 3,917,848 7,230,907 7,230,907 14
6,268,289 2,868,897 3,917,848 13,055,034 13,055,034

2021

Trade and other payables 7,341,078 0 0 7,341,078 7,341,078 12

Borrowings 859,957 2,250,089 3,180,818 6,290,864 6,290,864 14
8,201,035 2,250,089 3,180,818 13,631,942 13,631,942

| 37
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

23. EVENTS OCCURRING AFTER THE END OF THE REPORTING PERIOD

There have been no significant events after the reporting period that are to be included in 2021/2022.

| 38
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

24. OTHER SIGNIFICANT ACCOUNTING POLICIES

a) Goods and services tax (GST) i) Fair value hierarchy

Revenues, expenses and assets are recognised net of the amount of GST, AASB 13 requires the disclosure of fair value information by level of the fair value hierarchy,
except where the amount of GST incurred is not recoverable from the which categorises fair value measurement into one of three possible levels based on the lowest
Australian Taxation Office (ATO). level that an input that is significant to the measurement can be categorised into as follows:

Receivables and payables are stated inclusive of GST receivable or payable. Level 1
The net amount of GST recoverable from, or payable to, the ATO is included Measurements based on quoted prices (unadjusted) in active markets for identical assets or
with receivables or payables in the statement of financial position. liabilities that the entity can access at the measurement date.

Cash flows are presented on a gross basis. The GST components of cash Level 2
flows arising from investing or financing activities which are recoverable from, Measurements based on inputs other than quoted prices included in Level 1 that are
or payable to, the ATO are presented as operating cash flows. observable for the asset or liability, either directly or indirectly.

b) Current and non-current classification Level 3

The asset or liability is classified as current if it is expected to be settled Measurements based on unobservable inputs for the asset or liability.
within the next 12 months, being the Shire’s operational cycle. In the case of
liabilities where the Shire does not have the unconditional right to defer The fair values of assets and liabilities that are not traded in an active market are determined
settlement beyond 12 months, such as vested long service leave, the liability using one or more valuation techniques. These valuation techniques maximise, to the extent
is classified as current even if not expected to be settled within the next 12 possible, the use of observable market data. If all significant inputs required to measure fair
months. Inventories held for trading are classified as current or non-current value are observable, the asset or liability is included in Level 2. If one or more significant
based on the Shire's intentions to release for sale. inputs are not based on observable market data, the asset or liability is included in Level 3.

c) Rounding off figures Valuation techniques

All figures shown in this annual financial report, other than a rate in the dollar, The Shire selects a valuation technique that is appropriate in the circumstances and for which
are rounded to the nearest dollar. Amounts are presented in Australian Dollars. sufficient data is available to measure fair value. The availability of sufficient and relevant data
primarily depends on the specific characteristics of the asset or liability being measured. The
d) Comparative figures valuation techniques selected by the Shire are consistent with one or more of the following
Where required, comparative figures have been adjusted to conform with valuation approaches:
changes in presentation for the current financial year.
Market approach
When the Shire applies an accounting policy retrospectively, makes a Valuation techniques that use prices and other relevant information generated by market
retrospective restatement or reclassifies items in its financial statements that transactions for identical or similar assets or liabilities.
has a material effect on the statement of financial position, an additional
(third) Statement of Financial Position as at the beginning of the preceding Income approach
period in addition to the minimum comparative financial statements is Valuation techniques that convert estimated future cash flows or income and expenses into a
presented. single discounted present value.

e) Budget comparative figures Cost approach

Unless otherwise stated, the budget comparative figures shown in this annual Valuation techniques that reflect the current replacement cost of the service capacity of an asset.
financial report relate to the original budget estimate for the relevant item of
disclosure. Each valuation technique requires inputs that reflect the assumptions that buyers and sellers
would use when pricing the asset or liability, including assumptions about risks. When selecting
f) Superannuation a valuation technique, the Shire gives priority to those techniques that maximise the use of
The Shire contributes to a number of Superannuation Funds on behalf of observable inputs and minimise the use of unobservable inputs. Inputs that are developed using
employees. All funds to which the Shire contributes are defined contribution market data (such as publicly available information on actual transactions) and reflect the
plans. assumptions that buyers and sellers would generally use when pricing the asset or liability are
considered observable, whereas inputs for which market data is not available and therefore are
g) Fair value of assets and liabilities developed using the best information available about such assumptions are considered
Fair value is the price that the Shire would receive to sell the asset or would unobservable.
have to pay to transfer a liability, in an orderly (i.e. unforced) transaction
between independent, knowledgeable and willing market participants at the j) Impairment of assets
measurement date. In accordance with Australian Accounting Standards the Shire's cash generating non-specialised
assets, other than inventories, are assessed at each reporting date to determine whether there
As fair value is a market-based measure, the closest equivalent observable is any indication they may be impaired.
market pricing information is used to determine fair value. Adjustments to
market values may be made having regard to the characteristics of the Where such an indication exists, an impairment test is carried out on the asset by comparing
specific asset or liability. The fair values of assets that are not traded in an the recoverable amount of the asset, being the higher of the asset's fair value less costs to sell
active market are determined using one or more valuation techniques. These and value in use, to the asset's carrying amount.
valuation techniques maximise, to the extent possible, the use of observable
market data. Any excess of the asset's carrying amount over its recoverable amount is recognised
immediately in profit or loss, unless the asset is carried at a revalued amount in accordance
To the extent possible, market information is extracted from either the with another Standard (e.g. AASB 116) whereby any impairment loss of a revalued asset is
principal market for the asset or liability (i.e. the market with the greatest treated as a revaluation decrease in accordance with that other Standard.
volume and level of activity for the asset or liability) or, in the absence of
such a market, the most advantageous market available to the entity at the For non-cash generating specialised assets that are measured under the revaluation model,
end of the reporting period (i.e. the market that maximises the receipts from such as roads, drains, public buildings and the like, no annual assessment of impairment is
the sale of the asset after taking into account transaction costs and required. Rather AASB 116.31 applies and revaluations need only be made with sufficient
transport costs). regularity to ensure the carrying value does not differ materially from that which would be
determined using fair value at the end of the reporting period.
For non-financial assets, the fair value measurement also takes into account
a market participant’s ability to use the asset in its highest and best use or k) Initial application of accounting standards
to sell it to another market participant that would use the asset in its highest During the current year, no new or revised Australian Accounting Standards and Interpretations
and best use. were compiled, became mandatory and were applicable to its operations.

h) Interest earnings New accounting standards for application in future years

Interest income is calculated by applying the effective interest rate to the The following new accounting standards will have application to local government in future years:
gross carrying amount of a financial asset measured at amortised cost - AASB 2020-1 Amendments to Australian Accounting Standards - Classification of
except for financial assets that subsequently become credit-impaired. For Liabilities as Current or Non-current
credit-impaired financial assets the effective interest rate is applied to the - AASB 2020-3 Amendments to Australian Accounting Standards - Annual Improvements
net carrying amount of the financial asset (after deduction of the loss 2018-2020 and Other Amendments
allowance). - AASB 2021-2 Amendments to Australian Accounting Standards - Disclosure of Accounting
Policies or Definition of Accounting Estimates
- AASB 2021-7 Amendments to Australian Accounting Standards – Effective Date of
Amendments to AASB 10 and AASB 128 and Editorial Corrections

It is not expected these standards will have an impact on the

financial report.

| 39
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

25. FUNCTION AND ACTIVITY

(a) Service objectives and descriptions

Shire operations as disclosed in this financial report encompass the following service orientated functions and activities.

Objective Description
Governance
Administration and operation of facilities and services to members of council;
To provide a decision making process for the
other costs that relate to the tasks of assisting elected members and
efficient allocation of scarce resources.
ratepayers on matters which do not concern specific council services.

General purpose funding

To collect revenue to allow provision of Rates, general purpose government grants and interest revenue.
services.

Law, order, public safety

To provide services to help ensure a safer and Supervision of various by-laws, fire prevention, emergency services and
environmentally conscious community. animal control.

Health
To provide an operational framework for Food quality, eating house inspection, pest control and child health clinics.
environmental and community health.

Education and welfare

Facilities for senior citizens aged care, infant, day care centres, pre-school;
To provide services to disadvantaged persons,
assistance to play group and other community services and development
the elderly, children and youth.
activities.

Housing
To provide and maintain staff housing. Provision of staff housing.

Community amenities
Rubbish collection services, tip operation, administration of the town planning
To provide services required by the community. scheme, maintenance of cemeteries, storm water drainage maintenance,
sanitation maintenance and environmental protection.

Recreation and culture

To establish and effectively manage Operation/maintenance of halls, Broome Recreation and Aquatic Centre
infrastructure and resource which will help the (BRAC), various parks and reserves, beaches, library, museum and other
social being of the community. cultural activities.

Transport
To provide safe, effective and efficient transport Construction and maintenance of streets, roads, bridges, footpaths and
services to the community. street lighting.

Economic services
To help promote the Council's economic well The regulation and provision of tourism facilities, area promotion and building
being. control.

Other property and services

Private works and provision of unclassified civic building facilities. General
Administration support for Council's operations, allocated to other functions.
To monitor and control Council's overheads
Engineering, works and parks and gardens management, allocated to
operating accounts.
construction and maintenance jobs. Plant and depot operation and
maintenance, allocated to construction and maintenance jobs.

| 40
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

25. FUNCTION AND ACTIVITY (Continued)

(b) Income and expenses 2022 2022 2021

Actual Budget Actual
$ $ $
Income excluding grants, subsidies and contributions

Governance 5,575 1,620 60,659

General purpose funding 24,322,390 24,314,912 23,423,975
Law, order, public safety 106,485 120,861 148,313
Health 170,646 189,731 177,286
Housing 582,452 2,031,236 701,892
Community amenities 5,508,477 6,615,788 5,503,069
Recreation and culture 1,268,722 1,318,143 1,214,146
Transport 29,866 26,552 34,526
Economic services 409,612 911,027 1,363,345
Other property and services 2,190,319 2,160,280 1,796,791
34,594,544 37,690,150 34,424,002
Grants, subsidies and contributions
Governance 167,320 11,000 249,927
General purpose funding 2,094,859 822,334 1,912,440
Law, order, public safety 236,868 10,000 0
Health 5,185 5,000 6,671
Education and welfare 25,000 25,000 8,716
Community amenities 12,010 12,000 (104,191)
Recreation and culture 5,961,558 5,513,887 10,532,210
Transport 3,083,950 3,455,857 5,629,814
Economic services 150,000 0 12,457,682
Other property and services 127,700 315,000 110,724
11,864,450 10,170,078 30,803,993

Total Income 46,458,994 47,860,228 65,227,995

Expenses
Governance (2,183,664) (2,240,459) (2,583,924)
General purpose funding (538,621) (339,348) (503,141)
Law, order, public safety (1,480,256) (1,146,436) (1,156,449)
Health (716,640) (806,634) (721,968)
Education and welfare (336,997) (424,795) (495,116)
Housing (937,675) (2,247,459) (763,371)
Community amenities (9,396,455) (10,750,551) (9,804,428)
Recreation and culture (13,003,755) (13,995,567) (12,532,317)
Transport (9,557,758) (11,233,425) (9,250,596)
Economic services (2,332,914) (2,210,496) (1,953,585)
Other property and services (11,440,825) (241,123) (2,257,969)
Total expenses (51,925,560) (45,636,293) (42,022,864)

Net result for the period (5,466,566) 2,223,935 23,205,131

| 41
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

25. FUNCTION AND ACTIVITY (Continued)

2022 2022 2021
Actual Budget Actual
(c) Fees and Charges $ $ $
General purpose funding 125,809 95,365 48,553
Law, order, public safety 76,375 90,639 120,193
Health 170,646 189,731 177,286
Housing 582,152 2,031,236 700,436
Community amenities 5,429,026 6,379,383 5,119,044
Recreation and culture 1,190,796 1,252,218 1,181,588
Transport 16,300 15,000 13,501
Economic services 433,499 712,027 1,278,599
Other property and services 1,223,991 1,312,933 1,072,773
9,248,594 12,078,532 9,711,973

2022 2021
(d) Total Assets $ $
Governance 395,873 394,580
General purpose funding 13,588,620 12,934,623
Law, order, public safety 3,684,173 6,645,075
Health 6,092 0
Education and welfare 0 2,245,375
Housing 4,396,200 3,572,304
Community amenities 68,148,594 33,948,575
Recreation and culture 81,910,356 57,519,257
Transport 240,422,236 293,313,271
Economic services 5,607,215 5,896,080
Other property and services 47,029,958 37,144,624
465,189,316 453,613,764

| 42
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

26. RATING INFORMATION

(a) General Rates

2021/22 2021/22 2021/22 2021/22 2021/22 2021/22 2021/22 2021/22 2021/22 2020/21
Number Actual Actual Actual Actual Actual Budget Budget Budget Budget Actual
RATE TYPE Rate in of Rateable Rate Interim Back Total Rate Interim Back Total Total
Rate Description $ Properties Value * Revenue Rates Rates Revenue Revenue Rate Rate Revenue Revenue
$ $ $ $ $ $ $ $ $ $
Gross rental valuations
GRV - Residential 0.110204 4,942 116,990,608 12,892,833 86,810 4,666 12,984,309 12,892,832 100,000 0 12,992,832 12,641,949
GRV - Vacant 0.201729 187 2,909,899 587,011 46,117 (9,209) 623,919 587,011 0 0 587,011 585,097
GRV - Commercial 0.114171 555 55,404,595 6,325,598 79 247 6,325,924 6,325,598 0 0 6,325,598 6,170,103
GRV - Tourism 0.149349 454 17,635,598 2,633,859 (8,543) (8,388) 2,616,928 2,633,859 0 0 2,633,859 2,586,525
Unimproved valuations
UV - Commercial Rural 0.032458 21 13,230,113 429,423 (133,038) (279,869) 16,516 429,423 0 0 429,423 615,318
UV - Mining 0.119883 32 1,135,382 136,113 (5,674) (1,294) 129,145 136,113 0 0 136,113 128,293
UV - Rural 0.007763 54 17,508,953 135,922 0 0 135,922 135,922 0 0 135,922 133,471
Sub-Total 6,245 224,815,148 23,140,759 (14,249) (293,847) 22,832,663 23,140,758 100,000 0 23,240,758 22,860,756
Minimum
Minimum payment $
Gross rental valuations
GRV - Residential 1,220 61 585,647 74,420 0 0 74,420 74,420 0 0 74,420 81,740
GRV - Vacant 1,220 191 869,843 233,020 0 0 233,020 233,020 0 0 233,020 214,720
GRV - Commercial 1,220 23 170,491 28,060 0 0 28,060 28,060 0 0 28,060 29,280
GRV - Tourism 1,220 371 1,598,998 452,620 0 0 452,620 452,620 0 0 452,620 452,620
Unimproved valuations
UV - Commercial Rural 1,220 2 13,300 2,440 0 0 2,440 2,440 0 0 2,440 2,440
UV - Mining 500 25 48,318 12,500 0 0 12,500 12,500 0 0 12,500 14,500
UV - Rural 1,220 4 141,300 4,880 0 0 4,880 4,880 0 0 4,880 4,880
Sub-Total 677 3,427,897 807,940 0 0 807,940 807,940 0 0 807,940 800,180

6,922 228,243,045 23,948,699 (14,249) (293,847) 23,640,603 23,948,698 100,000 0 24,048,698 23,660,936

Reversal of prior year concession 323,822 0 0

Concessions on general rates (Refer note 26(b)) (61,790) (56,151) (378,107)
Total amount raised from general rates 23,902,635 23,992,547 23,282,829

* Rateable value is based on the value of properties at

the time the rate is raised.

The entire balance of rates revenue has been recognised at a point in time in accordance with AASB 1058 Income for not-for-profit entities .

| 43
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

26. RATING INFORMATION (Continued)

(b) Waivers or Concessions

Rate or Fee and

Charge to which
the Waiver or Waiver/ 2022 2022 2021
Concession is Granted Type Concession Discount Discount Actual Budget Actual
% $ $ $ $
General Rates Rate Concession 50% 22,478 20,702 20,330
General Rates Rate Concession 37% 8,733 8,733 8,576
General Rates Rate Concession 90% 26,716 26,716 26,236
General Rates Rate Concession 80% 0 0 322,965
General Rates Rate Concession 100% 3,863 0 0
61,790 56,151 378,107

Total discounts/concessions (Note 26) 61,790 56,151 378,107

Rate or Fee and Circumstances in which

Charge to which the Waiver or Concession is
the Waiver or Granted and to whom it was Objects and reasons of the Waiver
Concession is Granted available or Concession
Concession offered because of the nature of the undertaking of the organisation
Varying concessions to a charitable organisation (100%,
General Rates providing social housing and affordable housing.
90%, 50%, 37%)

Concession offered to reduce the impact of valuation increase and corresponding

General Rates 80% concession to pastoral properties
rates during the period.

| 44
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

26. RATING INFORMATION (Continued)

(b) Interest Charges & Instalments

Instalment Instalment Unpaid Rates

Date Plan Plan Interest
Instalment Options Due Admin Charge Interest Rate Rate
$ % %
Option One
Single full payment 19-August-2021 0.00 0.0% 7.0%
Option Two
First instalment 19-August-2021 10.20 0.0% 7.0%
Second instalment 06-January-2022 10.20 5.5% 7.0%
Option Three
First instalment 19-August-2021 10.20 0.0% 7.0%
Second instalment 21-October-2021 10.20 5.5% 7.0%
Third instalment 06-January-2022 10.20 5.5% 7.0%
Fourth instalment 10-March-2022 10.20 5.5% 7.0%

2022 2022 2021

Actual Budget Actual
$ $ $
Interest on unpaid rates 126,432 117,000 75,728
Interest on instalment plan 129,780 80,000 0
Charges on instalment plan 49,684 61,200 0
Payment arrangement fee 1,559 0 50
307,455 258,200 75,778

| 45
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

27. RATE SETTING STATEMENT INFORMATION

2021/22
2021/22 Budget 2021/22 2020/21
(30 June 2022 (30 June 2022 (1 July 2021 (30 June 2021
Carried Carried Brought Carried
Note Forward) Forward) Forward) Adjustments* Forward
$ $ $ $
(a) Non-cash amounts excluded from operating activities

The following non-cash revenue or expenditure has been excluded

from amounts attributable to operating activities within the Rate Setting
Statement in accordance with Financial Management Regulation 32.

Adjustments to operating activities

Less: Profit on asset disposals 10(b) (34,267) (100,568) (11,822) 0 (11,822)
Less: Non-cash grants and contributions for assets (236,864) 0 (2,322,545) (2,322,545) 0
Less: Movement in liabilities associated with restricted cash (356,478) 0 (35,885) 1,578,874 (1,614,759)
Less: Fair value adjustments to financial assets at fair value through profit and
loss (4,996) 0 (3,233) 0 (3,233)
Add: Loss on disposal of assets 10(b) 48,227 165,955 436,769 0 436,769
Add: Loss on revaluation of fixed assets 9(a) 8,383,982 0 0 0 0
Add: Depreciation 10(a) 14,277,414 12,629,134 12,525,339 0 12,525,339
Non-cash movements in non-current assets and liabilities:
Pensioner deferred rates (14,019) 0 2,884 0 2,884
Employee benefit provisions 74,519 0 (87,506) 135,413 (222,919)
Other provisions 614,303 0 (2,318,233) (2,256,896) (61,337)
Impairment of infrastructure 0 1,435,621 1,435,621 0
Other increase/decarease and non-cash movements 0 0 0 41,765 (41,765)
Non-cash amounts excluded from operating activities 22,751,821 12,694,521 9,621,389 (1,387,768) 11,009,157

(b) Non-cash amounts excluded from investing activities

The following non-cash revenue or expenditure has been excluded

from amounts attributable to investing activities within the Rate Setting
Statement in accordance with Financial Management Regulation 32.

Adjustments to investing activities

Property, plant and equipment received for substantially less than fair value 8(a) 236,868 0 2,322,545 2,322,545 0
Non-cash amounts excluded from investing activities 236,868 0 2,322,545 2,322,545 0

(c) Surplus/(deficit) after imposition of general rates

The following current assets and liabilities have been excluded

from the net current assets used in the Rate Setting Statement
in accordance with Financial Management Regulation 32 to
agree to the surplus/(deficit) after imposition of general rates.

Adjustments to net current assets

Less: Reserve accounts 29 (32,792,021) (28,348,140) (30,846,263) 4,020,261 (34,866,524)
- Bonds and deposits held by others 0 0 1,800 (1,800)
- Other liabilities 0 (873,991) 0 0 0
Add: Current liabilities not expected to be cleared at end of year 0
- Current portion of borrowings 14 444,162 854,092 859,957 0 859,957
- Current portion of developer contributions held in reserve 1,701,173 0 2,185,128 (2,991,704) 5,176,832
- Liability associated with restricted cash - bonds and deposits 0 0 (633,957) 633,957
- Liability not expected to be paid within 12 months 0 0 (700,158) 700,158
- Employee benefit provisions 1,324,537 2,379,880 1,197,060 0 1,197,060
Total adjustments to net current assets (29,322,149) (25,988,159) (26,604,118) (303,758) (26,300,360)

Net current assets used in the Rate Setting Statement

Total current assets 45,686,985 43,562,983 47,462,298 0 47,462,298
Less: Total current liabilities (13,473,253) (17,574,824) (16,322,492) 0 (16,322,492)
Less: Total adjustments to net current assets (29,322,149) (25,988,159) (26,604,118) (303,758) (26,300,360)
Net current assets used in the Rate Setting Statement 2,891,583 0 4,535,688 (303,758) 4,839,446

*Refer to Note 31 for information on the adjutsments made.

| 46
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

28. BORROWING AND LEASE LIABILITIES

(a) Borrowings
Actual Budget
New Loans Principal Principal Principal
Principal at During 2020- Repayments Principal at 30 New Loans Repayments Principal at Principal at 1 New Loans Repayments Principal at
Purpose Note 1 July 2020 21 During 2020-21 June 2021 During 2021-22 During 2021-22 30 June 2022 July 2021 During 2021-22 During 2021-22 30 June 2022
$ $ $ $ $ $ $ $ $ $ $
Civic Centre Redevelopment 994,413 0 (487,484) 506,929 0 (506,929) 0 506,929 0 (506,929) 0
Town Beach Development 1,450,000 0 (86,155) 1,363,845 0 (87,554) 1,276,291 1,363,845 0 (87,554) 1,276,291
BRAC Pavillion 121,517 0 (121,517) 0 0 0 0 0 0 0
Chinatown Revitalisation Stage 1 1,544,026 0 (158,935) 1,385,091 0 (161,954) 1,223,137 1,385,090 0 (161,954) 1,223,136
Chinatown Revitalisation Stage 2 0 1,785,000 0 1,785,000 0 (103,521) 1,681,479 1,785,000 0 (107,655) 1,677,345
China Town Contingency 0 0 0 0 1,800,000 0 1,800,000 0 1,800,000 (54,089) 1,745,911
Total 4,109,956 1,785,000 (854,091) 5,040,865 1,800,000 (859,958) 5,980,907 5,040,864 1,800,000 (918,181) 5,922,683

Self Supporting Loans

Life Saving Club 0 0 0 0 0 0 0 0 300,000 (18,094) 281,906
Broome Golf Club 0 1,250,000 0 1,250,000 0 0 1,250,000 1,250,000 0 (75,389) 1,174,611
Total Self Supporting Loans 0 1,250,000 0 1,250,000 0 0 1,250,000 1,250,000 300,000 (93,483) 1,456,517

Total Borrowings 14 4,109,956 3,035,000 (854,091) 6,290,865 1,800,000 (859,958) 7,230,907 6,290,864 2,100,000 (1,011,664) 7,379,200

* WA Treasury Corporation

Self supporting loans are financed by payments from third parties. These are shown in Note 4 as other financial assets at amortised cost.
All other loan repayments were financed by general purpose revenue.

(b) Borrowing Interest Repayments

Actual for year Budget for Actual for year
ending year ending ending
Purpose Note Function and activity Loan Number Institution Interest Rate 30 June 2022 30 June 2022 30 June 2021
$ $ $
Civic Centre Redevelopment Recreation and culture 193 WATC* 3.95% (14,848) (15,067) (34,302)
Town Beach Development Recreation and culture 195 WATC* 1.62% (20,730) (22,554) (23,032)
BRAC Pavillion Recreation and culture 194 WATC* 5.86% 0 0 (4,611)
Chinatown Revitalisation Stage 1 Economic services 196 WATC* 1.89% (24,630) (26,059) (28,344)
Chinatown Revitalisation Stage 2 Economic services 198 WATC* 1.95% (34,020) (24,790) (285)
China Town Contingency Economic services 201 WATC* 4.75% 0 (12,690) 0
Total (94,228) (101,160) (90,574)

Self Supporting Loans Interest Repayments

Life Saving Club Recreation and culture 200 WATC* TBC 0 (4,167) 0
Broome Golf Club Recreation and culture 199 WATC* 1.95% (24,225) (17,361) (200)
Total Self Supporting Loans Interest Repayments (24,225) (21,528) (200)

Total Interest Repayments 2(b) (118,453) (122,688) (90,774)

* WA Treasury Corporation

| 47
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

2022 2022 2022 2022 2022 2022 2022 2022 2021 2021 2021 2021
Actual Actual Actual Actual Budget Budget Budget Budget Actual Actual Actual Actual
Opening Transfer Closing Opening Transfer Closing Opening Transfer Closing
29. RESERVE ACCOUNTS Transfer to Transfer to Transfer to
Balance (from) Balance Balance (from) Balance Balance (from) Balance
$ $ $ $ $ $ $ $ $ $ $ $
Restricted by council
(a) Reserves cash backed - Leave Reserve 1,197,060 315,411 (187,934) 1,324,537 932,995 313,851 (115,646) 1,131,200 1,076,266 120,794 0 1,197,060
(b) Reserves cash backed - Restricted Cash 65,000 0 0 65,000 0 0 0 0 0 65,000 0 65,000
(c) Reserves cash backed - Community Sponsorship 81,454 268 0 81,722 100,799 0 0 100,799 97,271 469 (16,286) 81,454
(d) Reserves cash backed - EDL Sponsorship 62,024 205 0 62,229 55,522 145 0 55,667 134,882 650 (73,508) 62,024
(e) Reserves cash backed - Road Reserve 1,517,285 374,860 0 1,892,145 1,517,140 235,580 0 1,752,720 1,824,122 529,163 (836,000) 1,517,285
(f) Reserves cash backed - Public Art Reserve 6,211 21 0 6,232 6,211 20 0 6,231 6,182 29 0 6,211
(i) Reserves cash backed - BRAC (Leisure Centre) Reserve 58,504 193 0 58,697 58,500 187 (58,000) 687 58,224 280 0 58,504
(j) Reserves cash backed - Public Open Space 1,806,645 2,500,312 (516,966) 3,789,991 1,799,529 1,045,709 (172,800) 2,672,438 1,976,821 1,042,671 (1,212,847) 1,806,645
(k) Reserves cash backed - Drainage reserve 1,538,300 98,513 0 1,636,813 1,553,201 33,608 0 1,586,809 1,235,496 302,804 0 1,538,300
(l) Reserves cash backed - Plant 1,895,391 12,412 (291,216) 1,616,587 1,695,241 5,410 (252,500) 1,448,151 1,886,301 9,090 0 1,895,391
(m) Reserves cash backed - Buildings 2,920,961 559,604 (190,816) 3,289,749 2,896,772 481,416 (499,856) 2,878,332 2,361,421 758,101 (198,561) 2,920,961
(n) Reserves cash backed - Refuse Site Reserve 2,664,994 1,175,246 (1,265,617) 2,574,623 2,109,939 6,766 (1,512,617) 604,088 3,253,067 15,677 (603,750) 2,664,994
(o) Reserves cash backed - Regional Resource Recovery Park Reserve 13,291,670 42,198 (518,051) 12,815,817 13,189,289 44,690 (456,732) 12,777,247 14,121,030 68,052 (897,412) 13,291,670
(p) Reserves cash backed - IT & Equipment 714,651 345,812 (123,926) 936,537 647,704 223,697 (50,000) 821,401 710,263 99,498 (95,110) 714,651
(q) Reserves cash backed - Kimberley Zone 394,580 1,293 0 395,873 317,138 1,475 0 318,613 486,676 64,346 (156,442) 394,580
28,214,730 5,426,348 (3,094,526) 30,546,552 26,879,980 2,392,554 (3,118,151) 26,154,383 29,228,022 3,076,624 (4,089,916) 28,214,730

Restricted by Legislation
(g) Reserves cash backed - Carpark Reserve 348,224 43,133 0 391,357 348,201 42,980 0 391,181 295,639 52,585 0 348,224
(h) Reserves cash backed - Footpath Reserve 2,283,309 18,184 (447,381) 1,854,112 2,241,258 5,672 (444,354) 1,802,576 2,349,298 51,088 (117,077) 2,283,309
2,631,533 61,317 (447,381) 2,245,469 2,589,459 48,652 (444,354) 2,193,757 2,644,937 103,673 (117,077) 2,631,533

30,846,263 5,487,665 (3,541,907) 32,792,021 29,469,439 2,441,206 (3,562,505) 28,348,140 31,872,959 3,180,297 (4,206,993) 30,846,263

All reserves are supported by cash and cash equivalents and are restricted within equity as Reserves - cash backed.

In accordance with Council resolutions or adopted budget in relation to each reserve account, the purpose for which the reserves are set aside and their anticipated date of use are as follows:

Anticipated
Name of Reserve date of use Purpose of the reserve
(a) Reserves cash backed - Leave Reserve Ongoing To be used to fund annual and long service leave requirements.

(b) Reserves cash backed - Restricted Cash Ongoing To be used for unspent grant, contribution and loan funds.
To hold funds remaining as at 30 June after allocation of both Annual and Ad-hoc sponsorships and external donations to be spent on both annual and ad-hoc
(c) Reserves cash backed - Community Sponsorship Ongoing
sponsorships in accordance with the Community Sponsorship Program Policy.
(d) Reserves cash backed - EDL Sponsorship Ongoing To hold funds to be spent on community projects as approved by Energy Development Limited.

(e) Reserves cash backed - Road Reserve Ongoing To be used for renewal, upgrade or new streets and roads.

(f) Reserves cash backed - Public Art Reserve Ongoing To hold funds set aside annually to fund future public art projects and initiatives within the Shire.

(g) Reserves cash backed - Carpark Reserve Ongoing To be used for renewal, upgrade or new carparks. Typically funds are from "Cash In Lieu" payments from developers.

(h) Reserves cash backed - Footpath Reserve Ongoing To be used for renewal, upgrade or new footpaths. Typically, funds are from contributions made by developers.

(i) Reserves cash backed - BRAC (Leisure Centre) Reserve Ongoing To be used for the construction of recreation infrastructure and facilities.
To be used for renewal, upgrade, replacement or new public open space facilities and garden areas associated with buildings and other freely accessible public
(j) Reserves cash backed - Public Open Space Ongoing
recreational facilities. Any contributions from developers are held in Trust.
(k) Reserves cash backed - Drainage reserve Ongoing To be used for the renewal, upgrade or construction of drainage services. Typically funds are from contributions made by developers.

(l) Reserves cash backed - Plant Ongoing To be used for the renewal, upgrade or purchase of new mobile plant and engineering equipment.

(m) Reserves cash backed - Buildings Ongoing To be used for renewal, upgrade, replacement or new building construction and associated infrastructure.

(n) Reserves cash backed - Refuse Site Reserve Ongoing To be used for the current and future costs of maintaining and closing the refuse site in accordance with operational needs and environmental guidelines.
To hold funds set aside annually and any year end operational profit generated from refuse site business unit to fund:
(o) Reserves cash backed - Regional Resource Recovery Park Reserve Ongoing
i) The future construction of a new facility;
(p) Reserves cash backed - IT & Equipment Ongoing To be used for renewal, upgrade or new office equipment, IT hardware and software.

(q) Reserves cash backed - Kimberley Zone Ongoing To hold funds set aside annually to fund future projects and initiatives for the Kimberley Zone of WALGA and/or Regional Collaborative Groups.

| 48
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

30. TRUST FUNDS

Funds held at balance date which are required to be held in trust and which are not included in the
financial statements are as follows:

1 July 2021 Amounts Received Amounts Paid 30 June 2022

$ $ $ $

Town Planning Related Bond Deposits 106,562 0 0 106,562

Cash In Lieu Of Public Open Space 100,209 0 0 100,209
206,771 0 0 206,771

| 49
 SHIRE OF BROOME
NOTES TO AND FORMING PART OF THE FINANCIAL REPORT
FOR THE YEAR ENDED 30 JUNE 2022

31. RESTATEMENT OF RATE SETTING STATEMENT COMPARATIVES

The Shire of Broome engaged an external accounting firm to perform a review of prior years Rate Setting Statement (RSS) and Rate Setting Statement Information.
During this process it came to light that the net current assets used in the 2021 Rate Setting Statement and net current asset at the start of the year (2020) was overstated.
This resulted in a restatement of 2021 Rate Setting Statement including Net current assets used in the RSS for 2021 and 2020 and the related Rate Setting Statement information.
The following are the summary of the adjustments made and the explanations:

2021 2021
Actual Actual
as as previously
restated Adjustments reported Explanation
$ $ $

NET CURRENT ASSETS - At start of financial year -

2,828,740 (1,359,652) 4,188,392
surplus/(deficit) (FY 2020)

Breakdown of this adjustment and explanation is :

Current employee provision was incorrectly over adjusted in the past.
Current Liability Associated with restricted cash - leave
1,076,266 (1,303,614) 2,379,880 Should be adjusted up to cash backed leave reserves only. Corrected in
liability (employee provisions)
current year
Current Liability not expected to be paid within 12 Error noted in previous workings for reconciling amount in 2020.
0 (65,093) 65,093
months Corrected in current year
Bonds and deposits held by others 0 9,055 (9,055) Incorrectly removed in the past. Corrected in current year
(1,359,652)

Net Current Assets Used in Rate Setting Statement -

27 ( c ) 4,535,688 (303,758) 4,839,446
(FY 2021)

Breakdown of this adjustment and explanation is :

Current Liability associated with restricted cash - Current liability for contract and capital grant was incorrectly over
Contract & capital grant liabilities from contracts with (2,991,704) 394,600 (3,386,304) adjusted in the past . Should be adjusted up to restricted cash balance
customers only. Corrected in current year.

In 2021 , the Shire was less conservative and adjusted their Net current
Current Liability not expected to be paid within 12 assets with the whole current remediation provision since this amount
0 (700,158) 700,158
months would not be spent in the next 12 months . Net current assets was
incorrectly over adjusted in the past. Corrected in current year

Bonds and deposits held by others 0 1,800 (1,800) Incorrectly removed in the past. Corrected in current year
(303,758)

All other adjustments are reclassification of non-cash amounts between investing and operating and non cash movements between current and non-current balances to reconcile to the adjustments
made above

| 50
 Auditor General
INDEPENDENT AUDITOR’S REPORT
2022
Shire of Broome

To the Councillors of the Shire of Broome

Opinion
I have audited the financial report of the Shire of Broome (the Shire) which comprises:

• the Statement of Financial Position at 30 June 2022, the Statement of Comprehensive

Income by Nature or Type, Statement of Changes in Equity, Statement of Cash Flows and
Rate Setting Statement for the year then ended
• Notes comprising a summary of significant accounting policies and other explanatory
information.
In my opinion, the financial report:

• is based on proper accounts and records

• presents fairly, in all material respects, the results of the operations of the Shire for the year
ended 30 June 2022 and its financial position at the end of that period
• is in accordance with the Local Government Act 1995 (the Act) and, to the extent that they
are not inconsistent with the Act, Australian Accounting Standards.

Basis for opinion

I conducted my audit in accordance with Australian Auditing Standards. My responsibilities under
those standards are further described in the Auditor’s responsibilities for the audit of the financial
report section below.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis
for my opinion.

Emphasis of matter – Restatement of comparative balances

I draw attention to Note 31 to the financial report which states that the amounts reported in the
previously issued 30 June 2021 financial report have been restated and disclosed as
comparatives in this financial report. My opinion is not modified in respect of this matter.

Other information
The Chief Executive Officer (CEO) is responsible for preparing, and the Council for overseeing,
the other information. The other information is the information in the entity’s annual report for the
year ended 30 June 2022, but not the financial report and my auditor’s report.

My opinion on the financial report does not cover the other information and, accordingly, I do not
express any form of assurance conclusion thereon.

In connection with my audit of the financial report, my responsibility is to read the other
information and, in doing so, consider whether the other information is materially inconsistent

Page 1 of 3

7th Floor Albert Facey House 469 Wellington Street Perth MAIL TO: Perth BC PO Box 8489 Perth WA 6849 TEL: 08 6557 7500
with the financial report or my knowledge obtained in the audit, or otherwise appears to be
materially misstated.

If, based on the work I have performed, I conclude that there is a material misstatement of this
other information, I am required to report that fact. I did not receive the other information prior to
the date of this auditor’s report. When I do receive it, I will read it and if I conclude that there is a
material misstatement in this information, I am required to communicate the matter to the CEO
and Council and request them to correct the misstated information. If the misstated information is
not corrected, I may need to retract this auditor’s report and re-issue an amended report.

Responsibilities of the Chief Executive Officer and Council for the financial report
The Chief Executive Officer of the Shire is responsible for:
• preparation and fair presentation of the financial report in accordance with the requirements
of the Act, the Regulations and Australian Accounting Standards
• managing internal control as required by the CEO to ensure the financial report is free from
material misstatement, whether due to fraud or error.
In preparing the financial report, the CEO is responsible for:
• assessing the Shire’s ability to continue as a going concern
• disclosing, as applicable, matters related to going concern
• using the going concern basis of accounting unless the State Government has made
decisions affecting the continued existence of the Shire.
The Council is responsible for overseeing the Shire’s financial reporting process.

Auditor’s responsibilities for the audit of the financial report

As required by the Auditor General Act 2006, my responsibility is to express an opinion on the
financial report. The objectives of my audit are to obtain reasonable assurance about whether the
financial report as a whole is free from material misstatement, whether due to fraud or error, and
to issue an auditor’s report that includes my opinion. Reasonable assurance is a high level of
assurance but is not a guarantee that an audit conducted in accordance with Australian Auditing
Standards will always detect a material misstatement when it exists.

Misstatements can arise from fraud or error and are considered material if, individually or in the
aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of the financial report. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error, as fraud may involve collusion,
forgery, intentional omissions, misrepresentations or the override of internal control.

A further description of my responsibilities for the audit of the financial report is located on the
Auditing and Assurance Standards Board website. This description forms part of my auditor’s
report and can be found at https://www.auasb.gov.au/auditors_responsibilities/ar4.pdf.

My independence and quality control relating to the report on the financial report
I have complied with the independence requirements of the Auditor General Act 2006 and the
relevant ethical requirements relating to assurance engagements. In accordance with ASQC 1
Quality Control for Firms that Perform Audits and Reviews of Financial Reports and Other
Financial Information, and Other Assurance Engagements, the Office of the Auditor General
maintains a comprehensive system of quality control including documented policies and
procedures regarding compliance with ethical requirements, professional standards and
applicable legal and regulatory requirements.

Page 2 of 3
Matters relating to the electronic publication of the audited financial report
This auditor’s report relates to the financial report of the Shire of Broome for the year ended
30 June 2022 included in the annual report on the Shire’s website. The Shire’s management is
responsible for the integrity of the Shire’s website. This audit does not provide assurance on the
integrity of the Shire’s website. The auditor’s report refers only to the financial report. It does not
provide an opinion on any other information which may have been hyperlinked to/from the annual
report. If users of the financial report are concerned with the inherent risks arising from
publication on a website, they are advised to contact the Shire to confirm the information
contained in the website version.

Sandra Labuschagne
Acting Auditor General for Western Australia
Perth, Western Australia
14 April 2023

Page 3 of 3
 96

FEEDBACK
If you have a comment or questions about the
Annual Report here’s how to contact us.

In person: Shire Administration Centre

Cnr Weld and Haas Street
Broome, Western Australia
Phone: +618 9191 3456
Email: shire@broome.wa.gov.au
Facebook: facebook.com/BroomeWesternAustralia/
Instagram: instagram.com/shireofbroome/
Mail: PO Box 44, Broome
Western Australia 6725

www.broome.wa.gov.au