Part C: Financial information

Financial statements

PROSPECTIVE STATEMENT OF COMPREHENSIVE REVENUE AND EXPENSE

  2016/17
AP
$000s
2017/18
AP
$000s
Variance to
AP
$000s
Notes
         
INCOME        
Revenue from rates 284,138 296,806 12,668  
Revenue from development contributions 2,000 2,000 -  
Revenue from grants, subsidies and reimbursements 41,037 55,913 14,876 1
Revenue from operating activities 121,965 130,702 8,737 2
Investments 20,447 22,454 2,007  
Fair value movement on investment property revalaution 3,989 3,058 (931)  
Other revenue 1,050 1,050 -  
Finance revenue 650 704 54  
TOTAL INCOME 475,276 512,687 37,411  
EXPENSE        
Finance expense 25,617 25,420 (197)  
Expenditure on operating activities 334,923 348,489 13,566 3
Depreciation and amortisation 101,975 106,417 4,442  
TOTAL EXPENSE 462,515 480,326 17,811  
NET SURPLUS FOR THE YEAR 12,761 32,361 19,600  
OTHER COMPREHENSIVE INCOME        
Fair value movement - property, plant and equipment - net 106,241 122,876 16,635  
Share of equity accounted surplus from associates - - -  
TOTAL OTHER COMPREHENSIVE INCOME 106,241 122,876 16,635  
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 119,002 155,237 36,235  

Notes:

  1. NZTA funding associated with the one off access to LED street light funding for 2017/18 makes up the majority of this variance.
  2. The majority of this variance is the recognition of 3rd party revenue related to the contract with Dimension Data to delivery our ICT infrastructure.
  3. This variance is related to two above and is recognisng the full contract cost with Dimension Data to delivery our ICT infrastructure.

4. EXPLANATION OF SURPLUS Variance to AP $000's
   
Items that are presented in the Prospective Statement of Comprehensive Revenue and Expense but do not offset rates.  
   
BALANCED BUDGET 0
   
DEPRECIATION NOT FUNDED BY RATES:  
Depreciation collected for capital assets that will not be renewed  
NZTA Transport funded projects (7,598)
General (82)
Moa Point sewerage treatment plant (3,146)
Decommissioned Living Earth joint venture plant (207)
Wellington Waterfront Limited Depreciation (3,156)
TOTAL DEPRECIATION NOT FUNDED BY RATES (14,189)
   
REVENUE RECEIVED FOR CAPITAL PURPOSES:  
Funding received from external parties for major capital expenditure projects  
NZTA capital funding 30,573
Housing ring-fenced surplus (2,657)
Housing capital grant 11,790
Development contributions 2,000
Bequests, trust and other external funding 3,950
TOTAL REVENUE RECEIVED FOR CAPITAL PURPOSES 45,656
   
ITEMS FUNDED FROM PRIOR YEAR SURPLUSES:  
City Growth Fund (3,000)
Resilience Team additional year funding (300)
Earthquake emergency rental costs (782)
Business transformation team one year costs (500)
Westapac Stadium Grant delay (436)
Ballet temporary accomodation (166)
TOTAL ITEMS FUNDED FROM PRIOR YEAR SURPLUSES (5,184)
   
ADDITIONAL OPERATIONAL EXPENDITURE ITEMS:  
Operational expenditure items identified as equitable to be funded through other funding mechanisms  
Alex Moore Park (245)
Cable car 125
Odyssey - related 221
Roading 130
Toitu Poneke 80
Weathertight Homes funding 7,227
Westpac Stadium (4,164)
Reserves purchases and development fund (24)
Welly Moving project spend (1,040)
Kilbirnie Bowling club demolition (173)
Technology Infrastructure and Software 231
Unrealised fair value adjustment for loans and receivables 650
Fair value movement on investment property revaluation 3,058
TOTAL ADDITIONAL ITEMS 6,078
TOTAL SURPLUS 32,361

PROSPECTIVE STATEMENT OF FINANCIAL POSITIONTop

  2016/17
AP
$000
2017/18
AP
$000
Variance to
AP
$000
Notes
         
ASSETS        
Current assets        
Cash and cash equivalents 1,714 1,144 (570)  
Derivative financial assets - - -  
Receivables and recoverables 42,834 48,542 5,708  
Prepayments 13,433 13,414 (19)  
Inventories 906 932 26  
Total current assets 58,887 64,032 5,145  
         
Non-current assets        
Other financial assets 11,954 17,016 5,062  
Intangibles 28,578 28,306 (272)  
Investment properties 213,931 221,512 7,581  
Property, plant & equipment 6,771,399 7,004,869 233,470  
Investment in subsidiaries 5,071 5,071 -  
Investment in associates 19,465 19,465 -  
         
Total non-current assets 7,050,398 7,296,239 245,841  
TOTAL ASSETS 7,109,285 7,360,271 250,986  
         
LIABILITIES        
         
Current liabilities        
Derivative financial liabilities - - -  
Trade and other payables 62,477 62,060 (417)  
Revenue in advance 16,717 13,132 (3,585)  
Borrowings 267,279 269,984 2,705  
Employee benefit liabilities and provisions 7,180 7,807 627  
Provision for other liabilities 7,972 12,028 4,056  
Total current liabilities 361,625 365,011 3,386  
         
Non-current liabilities        
Derivative financial liabilities - - -  
Trade and other payables 630 630 -  
Borrowings 211,766 258,167 46,401  
Employee benefit liabilities 1,593 1,467 (126)  
Provisions for other liabilities 18,231 28,110 9,879  
Total non-current liabilities 232,220 288,374 56,154  
TOTAL LIABILITIES 593,845 653,385 59,539  
         
EQUITY        
         
Accumulated funds and retained earnings 5,011,091 5,077,829 66,738  
Revaluation reserves 1,489,442 1,611,454 122,012  
Hedging reserve - - -  
Fair value through other comprehensive income reserve 106 1,648 1,542  
Restricted funds 14,801 15,955 1,154  
         
TOTAL EQUITY 6,515,440 6,706,886 191,446  
         
TOTAL EQUITY AND LIABILITIES 7,109,285 7,360,271 250,985  

PROSPECTIVE STATEMENT OF CHANGES IN EQUITYTop

  2016/17
AP
$000
2017/18
AP
$000
Variance to
AP
$000
Notes
         
EQUITY – OPENING BALANCES        
Accumulated funds and retained earnings 4,999,468 5,046,221 46,753  
Revaluation reserves 1,383,201 1,488,578 105,377  
Hedging reserve - - -  
Fair value through other comprehensive income reserve 106 1,648 1,542  
Restricted funds 13,663 15,202 1,539  
TOTAL EQUITY - Opening balance 6,396,438 6,551,649 155,211  
         
CHANGES IN EQUITY        
         
Retained earnings        
Net surplusfor the year 12,761 32,361 19,600  
Transfer to restricted funds (4,518) (4,518) -  
Transfer from restricted funds 3,380 3,765 385  
         
Revaluation reserves        
Fair value movement - property, plant and equipment - net 106,241 122,876 16,635  
         
Hedging reserve        
Share of other comprehensive income - - -  
         
Restricted Funds        
Transfer to retained earnings (3,380) (3,765) (385)  
Transfer from retained earnings 4,518 4,518 -  
         
TOTAL COMPREHENSIVE INCOME 119,002 155,237 36,235  
         
EQUITY - CLOSING BALANCES        
Accumulated funds and retained earnings 5,011,091 5,077,829 66,738  
Revaluation reserves 1,489,442 1,611,454 122,012  
Hedging reserve 0 0 -  
Fair value through other comprehensive revenue and expense 106 1,648 1,542  
Restricted funds 14,801 15,955 1,154  
         
TOTAL EQUITY - Closing balance 6,515,440 6,706,886 191,446  

PROSPECTIVE STATEMENT OF CASH FLOWSTop

  2016/17
AP
$000
2017/18
AP
$000
Variance to
AP
$000
Notes
         
CASH FLOWS FROM OPERATING ACTIVITIES        
Receipts from rates - Council 292,828 278,112 (14,716)  
Receipts from rates - Greater Wellington Regional Council 56,838 60,573 3,735 1
Receipts from activities and other income 100,082 140,506 40,424 2
Receipts from grants and subsidies - operating 33,017 9,600 (23,417)  
Receipts from grants and subsidies - capital 8,020 46,313 38,293  
Receipts from investment property lease rentals 9,335 11,214 1,879  
Cash paid to suppliers and employees (298,973) (317,801) (18,828)  
Rates paid to Greater Wellington Regional Council (56,838) (60,573) (3,735) 1
Grants paid (42,672) (45,651) (2,979)  
         
NET CASH FLOWS FROM OPERATING ACTIVITIES 101,637 122,293 20,656  
         
CASH FLOWS FROM INVESTING ACTIVITIES        
         
Dividends received 11,112 11,240 128  
Interest received 650 704 54  
Proceeds from sale of property, plant and equipment 4,600 10,350 5,750  
Purchase of Intangibles (5,102) (8,162) (3,060) 3
Purchase of property, plant and equipment (165,583) (187,584) (22,001)  
         
NET CASH FLOWS FROM INVESTING ACTIVITIES (154,323) (173,452) (19,129)  
         
CASH FLOWS FROM FINANCING ACTIVITIES        
         
New borrowings 298,783 313,020 14,237  
Repayment of borrowings (227,516) (224,977) 2,539  
Interest paid on borrowings (26,690) (26,863) (173)  
         
NET CASH FLOWS FROM FINANCING ACTIVITIES 44,577 61,180 16,603  
         
Net increase/(decrease) in cash and cash equivalents (8,109) 10,021 18,130  
Cash and cash equivalents at beginning of year 9,823 (8,877) (18,700)  
         
CASH AND CASH EQUIVALENTS AT END OF YEAR 1,714 1,144 (570)  

Notes:

  1. Wellington City Council collects rates on behalf of Greater Wellington Regional Council (GWRC).
  2. Decrease in income from activites is detailed in the Funding Impact Statements by Activity.
  3. Decrease in budgeted spend on information technology-related items in 2016/17.

PROSPECTIVE STATEMENT OF CHANGES IN RESTRICTED FUNDSTop

  OPENING BALANCE
2017/18
$000
DEPOSITS

$000
EXPENDITURE

$000
CLOSING BALANCE
2017/18
$000
Purpose
           
SPECIAL RESERVES AND FUNDS          
Reserve purchase and development fund 782 0 0 782 Used to purchase and develop reserve areas within the city.
Economic initiatives development fund 3,876 3,000 (3,000) 3,876  
Insurance reserve 4,500 10,000 (4,500) 10,000 Allows the Council to meet the uninsured portion of insurance claims
Total special reserves and funds 9,158 13,000 (7,500) 14,658  
           
           
TRUSTS AND BEQUESTS          
A Graham Trust 3 - - 3 For the upkeep of a specific area of Karori Cemetery
A W Newton Bequest 319 16 (15) 320 For the benefit of art (Fine Arts Wellington), education (technical and other night schools) and athletics (rowing)
E A McMillan Estate 6 - - 6 For the benefit of the public library
E Pengelly Bequest 15 1 - 16 For the purchase of children's books
F L Irvine Smith Memorial 7 - - 7 For the purchase of books for the Khandallah Library
Greek NZ Memorial Association 5 - - 5 For the maintenance and upgrade of the memorial
Kidsarus 2 Donation 3 - - 3 For the purchase of children's books
Kirkaldie and Stains Donation 17 - - 17 For the beautification of the BNZ site
QEII Memorial Book Fund 21 1 - 22 For the purchase of books on the Commonwealth
Schola Cantorum Trust 8 - - 8 For the purchase of musical scores
Terawhiti Grant 10 - - 10 To be used on library book purchases
Wellington Beautifying Society Bequest 14 - - 14 To be used on library book purchases
Total trusts and bequests 428 18 (15) 431  
Total restricted funds 9,586 13,018 (7,515) 15,089