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WMRLC Draft Budget 2020/21

Whitehorse Manningham Regional Library Corporation

Attachment 1

DRAFT BUDGET 2020/2021

1 WMRLC Draft Budget 2020/21

CONTENTS Page 1 Introduction 2

2 Executive summary 3

3 Link to the Library Plan 5

Budget Analysis

4 Budget principles 9

5 Budget influences 10

6 Analysis of operating budget 11

7 Analysis of budgeted cash position 16

8 Budgeted Capital Works 18

9 Analysis of budgeted financial position 21

10 Strategic Resource Plan and Key Financial Indicators 22

11 Financial Statements 26

Appendices

A Fees and charges schedule 30

B Budget process 31


1 Introduction

Whitehorse Manningham Regional Library Corporation (WMRLC) is a Library

Corporation under Section 196 of the Local Government Act 1989. The

Corporation provides a public library service to the municipalities of Whitehorse and

Manningham (the member Councils), which have a combined estimated residential

population of 313,927.

The Corporation is governed by a Board comprising two Councillor representatives

from each of the member Councils, the Chief Executive Officers from the member

Councils and two community representatives. The Corporation’s Chief Executive

Officer reports to the Board and is responsible for the management of the

Corporation.

The Library Plan 2017-2021 sets out the strategic plan to deliver the Corporation’s

vision over the four year period. The proposed Budget 2020/2021 details the

resources required over the next year to achieve the Library Plan actions. The

Budget supports the delivery of core library services, while continuing to strengthen

the reading and life-long learning programs where possible.

The proposed 2020/2021 Budget is presented in a format which demonstrates the

proposed 2020/2021 Cash Budget, the 2020/2021 Budget and anticipated final

results for the 2019/2020 Budget. A Budgeted Income Statement, Budgeted

Statement of Capital Works, Budgeted Balance Sheet and Budgeted Cash Flow

Statement are provided.


2 Executive Summary

The Corporation has prepared a Budget for 2020/2021 which is aligned to the

vision set out in the Library Plan 2017-2021. It seeks to maintain library services

that are valued by our community. It has been developed to ensure the Corporation

is financially sustainable, while also ensuring it can deliver the strategic objectives

and actions set out in the Library Plan.

The Corporation continues to strive to contain costs through system improvements,

respects the financially constrained environment and takes opportunities to explore

additional revenue sources where possible. Expenditure in all areas has been

reviewed and is considered realistic. Savings achieved through the implementation

of back end efficiencies over recent years has enabled the Corporation to off-set

some of the continued decline in operating revenue and maintain existing service

levels. In 2020/21 the Corporation is seeking an additional contribution from its

member Councils to enable the implementation of one service initiative and to

assist with the further decline in operating income. This Budget projects a balanced

budget for the 2020/2021 financial year.

2.1 Key things we are funding

Strategy 1. Read, Learn and Discover

1) Maintaining physical library collections and continued investment in e-

resources.

2) Maintaining delivery of reading and life-learning programs and events for all

ages throughout the year.

3) Achievement of the Literacy Strategy priorities including support for early

literacy and English as an Additional Language programs and resources.

Strategy 2. Connect, Collaborate and Participate

1) Delivery of one literature festival.

2) Continued support for volunteer engagement.

Strategy 3. Experience

1) Removal of charges for reservation of library collection items.

2) Review of library webpage.

3) Scheduled replacement of IT equipment including server hardware and

public computers.

4) Improvements to internal signage and way finding at some library branches.


Strategy 4. Value

1) A reduction in the number of scheduled Internal Audits from three down to

two.

2) Continued implementation of the Digitisation Strategy.

3) Maintaining support for fundraising, sponsorship and grant seeking

activities.

2.2 Key Statistics

Total Income $11,381,463 (2019/20 = $11,209,764)

Total Expenditure $11,045,755 (2019/20 = $10,821,535)

Accounting Result* $335,708 Surplus (2019/20 = $388,229) (Anticipated Surplus)

(Refer to Income Statement in Section 11.1)

Total Capital Works $2,032,051 (2019/20 = $1,990,679)


3 Links to the Library Plan

This section describes how the Annual Budget links to the achievement of the Library

Plan 2017 - 20121.

3.1 Planning and accountability framework

The Strategic Resource Plan is a rolling five year plan that outlines the financial and

non-financial resources that the Corporation requires to achieve the strategic

objectives described in the Library Plan. The Annual Budget is framed within the

Strategic Resource Plan, taking into account the services and initiatives which

contribute to achieving the strategic objectives specified in the Library Plan. The

Annual Report includes a report on operations, financial statements and performance

results.

The Library Plan, including the Strategic Resource Plan is required to be completed by

30 June following the general election of Councillors. The Strategic Resource Plan is

reviewed each year in advance of the commencement of the Annual Budget process.

3.2 Our purpose

Whitehorse Manningham Libraries – Open for Discovery

Our vision

A library open for all to discover a world of possibilities.

Our mission

To provide opportunities that inspire our community to read, learn, connect and create.

Our values

Respect

We acknowledge our diverse community and support equal access to services by all.

Integrity

We are open, honest and accountable in the way we conduct our business.

Community Driven

Our services and the way we deliver them are shaped by the needs and aspirations of

our community.


Collaboration

Together we develop positive relationships and partnerships that strengthen our

services and their impact.

Excellence

We aim for excellence and strive to find new ways to improve how we work and deliver

services.

3.3 Strategic objectives

The following table lists the four strategic goals as described in the Library Plan 2017-

2021

Strategic Objective Description

1. Read, Learn and Discover

Our library has a critical role in contributing to

community and individual wellbeing by

providing accessible and engaging collections,

resources and programs that encourage life-

long learning and reading for pleasure.

2. Connect, Collaborate and

Participate

Our library provides opportunities for social

connection and community engagement. We

actively invite and develop collaborative

community partnerships to achieve mutual

benefits.

3. Experience

Our libraries are important civic spaces where

all in the community should feel welcome. We

strive for excellence in all aspects of our

services to ensure a positive and responsive

experience for all customers.

4. Value We apply best practice principles to the way we

work to ensure our services continue to be

relevant and sustainable.


3.4 Service Performance indicators – five year trends

Sustained high use of library collections and branches

Note: Services at Box Hill were impacted in 2017/18 due to renovations

68% increase in E-resource loans

(includes e-books, e- magazines, e- audio and other digital resources)

1,305,997 1,294,226 1,304,027 1,292,745 1,332,790

3,129,910 3,163,303 3,238,600 3,124,528 3,132,826

2014/15 2015/16 2016/17 2017/18 2018/19

Total Loans and Branch Visits

Visits to branches Loans of collection items

265,633294,894

365,083340,056

445,690

2014/15 2015/16 2016/17 2017/18 2018/19

E-reource loans


16.4% increase in information enquiries

108% increase in volunteer numbers

17% increase in program attendance

136,429

143,467

149,162 152,725

158,764

2014/15 2015/16 2016/17 2017/18 2018/19

Financial Year

Information Enquiries responded to by staff

77 8197

149160

2014/15 2015/16 2016/17 2017/18 2018/19

Number of Volunteers

69,765 69,800 71,051

76,012

81,581

2014/15 2015/16 2016/17 2017/2018 2018/19

Program Attendance


High use of public computers and Wi- Fi

Budget Analysis

4 Budget principles

The preparation of the 2020/2021 Budget is informed by the following overarching

principles:

• Service levels to be maintained at 2019/2020 levels.

• Removal of reservation charges as of 1July 2020.

• Alignment of budget to the delivery of the Library Plan objectives.

• Alignment of service delivery to community need and expectation.

• Review of all areas of expenditure against anticipated service needs and

market trends and containing increases as much as possible.

• Warrandyte Library is funded by Manningham City Council outside of the

Regional Library Agreement and is not reflected in this budget.

-

100,000

200,000

300,000

400,000

500,000

600,000

700,000

800,000

2014/15 2015/16 2016/17 2017/18 2018/19

Public Internet Sessions

Fixed PC Wifi


5 Budget Influences

The preparation of this budget is influenced by an number of internal and external

factors including the following:

• Contributions from member Councils are forecast to increase by a total of 3.5%

(comprising of 2% plus an additional contribution to offset the forecast deficit

associated with the cost of removing reservation charges and decline in

operating income from other sources).

• State government grant is forecast to increase by 1.8%

• Continued decline in revenue from user fees and charges.

• Forecast interest rates below 0.75%

• Anticipated Enterprise Agreement and Employer Super Guarantee increases.

• Increased cost of collection materials, marketing, cleaning, couriers and some

utilities.

• Demographic trends including increased cultural diversity and ageing

population. Along with a forecast 1.44% increase in the Whitehorse

Manningham population in 2021 compared to 2020 (forecast.id).

0

50,000

100,000

150,000

200,000

250,000

14/15 15/16 16/17 17/18 18/19

5 year trend - Overdue fine revenue


6 Analysis of operating budget

This section of the report analyses the operating budget including the expected income

and expenses of the Corporation for the 2020/2021 financial year.

The following notes are presented to demonstrate the key parameters and

assumptions underpinning the budget and to provide additional explanatory

information.

6.1 Income

The Corporation receives funds through member Council contributions and State

Government funding. The Corporation generates small amounts through user fees,

charges and interest earned on investments.

Income type Forecast

Actual

2019/2020

Budget

2020/2021

Variance

Council Contributions 8,833,163 9,142,268 309,105

State government Public Libraries Funding 1,778,230 1,810,238 32,008

Other Grants 129,490 131,175 1,685

Fees/Charges 293,336 252,000 (41,336)

Income from Investments 44,946 44,000 (946)

Cash Surplus c/fwd 81,146 1,782 (79,364)

Total Income 11,160,311 11,381,463 221,152


Council Contributions

Member Council contributions are in accordance with the agreed funding formula set

out in the Regional Library Agreement. The increase in contributions for the 2020/2021

financial year is a total of 3.5% (2% in line with the rate cap percentage amount plus

an additional contribution to implement the removal of reservation charges and help

offset the declining operating income from other sources).

Member Council Contributions Forecast Actual

2019/2020

Budget

2020/2021

Variance

City of Whitehorse 5,307,497 5,493,112 185,615

Manningham City Council 3,525,665 3,649,156 123,490

Total contributions 8,833,163 9,142,268 309,105

Grants

The State Government recurrent core and local priorities funding is forecast to

increase by 1.8%; the increase is confirmed by the State Government in June. No

increase is forecast for the Premiers Reading Challenge grant; the funding amount is

usually confirmed in December.

Income from other grants and donations is not included in the budget unless it is

known at the time of the budget preparation.

80%

16%

1%2%

1%0%

Total Income 2020/2021

Council Contributions

State government PublicLibraries Funding

Other Grants

Fees/Charges

Income from Investments

Cash Surplus c/fwd


Recurrent grants Forecast Actual

2019/2020

Budget

2020/2021

Variance

State Public Libraries - Core 1,778,230 1,810,238 32,008

State Local Priorities 93,591 95,276 1,685

Premiers Reading Challenge 35,899 35,899 0

Total recurrent grants 1,907,720 1,941,413 33,693

User Fees and Charges ($41,336 decrease)

User fees and charges includes income from lost, damaged and overdue charges,

printing and copying, meeting room hire and sale of products. User fees and charges

have been reviewed and benchmarked against those of other public library services.

Total revenue from user fees and charges is forecast to decrease compared to the

previous year’s budgeted income due to the ceasing of reservation charges and

continued decline in revenue from overdue fines.

The proposed schedule of Fees and Charges is detailed at Appendix A.

Interest from Investments ($946 decrease)

Interest from investments includes interest earned on available cash throughout the

year. Cash funds and cash requirements are reviewed on a daily basis to identify

funds available and required to meet the Corporation’s obligations and surplus cash

funds are identified for investment availability. The Corporation expects to receive less

significantly less than budgeted in 2019/2020 due to the lowering of interest rates.

Rates are forecast to remain low in 2020/2021.

6.2 Operating Expenditure

Expense types Forecast Actual

2019/2020

Budget

2020/2021

Variance

Employee costs 7,512,989 7,642,035 129,046

Grant expenditure 129,490 131,175 1,685

Other expenses 1,526,473 1,572,202 45,729

Total Expenses 9,168,952 9,349,412 176,460

Total operating expenditure is projected to increase by $176,460 over forecasted

expenditure for 2019/2020. In total, the operating expenditure is due to increase by

1.41% based on the 2019/20 budget figure and 1.9% on the anticipated total operating

expenditure spend.


Employee costs ($129,046 increase)

Employee costs comprise 82% of total operating expenditure.

Employees costs include all labour related expenditure such as salaries and on costs

including allowances, banding increments, leave entitlements, employer superannuation

guarantee, Workcover, penalty payments for weekend work, staff development,

Employee Assistance Program, relief staff to cover leave absences and engagement of

external specialist resources where required.

Employee costs are forecast to increase by 2% or $129,046 compared to budgeted cost

for 2019/2020. This increase relates to three key factors:

• Enterprise Agreement increases

• Maintaining existing staff levels

• Zero increase to staff development expenditure

Utilities ($32,083 increase)

Gas, Electricity, Water, Building Security, Cleaning and Courier costs increased to meet

anticipated rises.

82%

3% 4%

6%

4%

1%

Total Expenditure 2020/2021

Employee costs

Collection Resources

Information Technology andServices

Utilites

Other expenses

Grant expenditure


Information services ($19,000 decrease)

Included in this budget is the Library Management System, Debt Recovery and Libraries

Australia costs. This budget has decrease due to the decision to cease the subscription

to Lynda.com as a result of a change in access terms and conditions for library

members.

Information technology ($14,300 increase)

While it is anticipated there will be some savings realised as a result of the Wide Area

Network upgrade, other costs are anticipated to increase.

Collection resources (non- capital) ($18,000 Increase)

Included in this budget are periodicals, newspapers and some electronic collection

resources (e-magazines, online newspapers, databases). These types of items are non-

depreciable and therefore not regarded as assets.

Insurance ($2,145 increase)

Increased to meet forecast rise in insurance costs

All other expenses ($22,905 decrease)


7 Analysis of Budgeted Cash Position

This section of the report analyses the expected cash flows from the operating, investing

and financing activities of the Corporation for the 2020/21 year. Budgeting cash flows for

the Corporation is a key factor in ensuring it can meet its strategic and financial

commitments, and provides a guide to the level of capital expenditure that can be

sustained with or without using existing cash reserves.

Forecast Actual

2019-2020

Budget

2020-2021

Variance

Cash flows from operating activities

Contributions Received 8,833,164 9,142,268 309,104

Grants Received 1,767,821 1,810,238 42,417

Interest Received 85,000 44,000 (41,000) Other Grants Received 128,942 131,175 2,233

User Fees and Charges 394,838 253,782 (141,056) 11,209,765 11,381,463 171,698

Payments to Employees / Suppliers (9,178,644) (9,257,295) (78,651

Net cash provided by operating activities

2,031,121 2,124,168 93,047

Cash flows from Investing Activities

Payments for Collection Resources, Equipment and Furniture

(1,925,150) (2,032,051) (106,901)

Proceeds from Sale of Equipment

Net cash provided by investing activities

(1,925,150) (2,032,051) (106,901)

Net increase (decrease) in cash held 105,971 92,117 (13,854)

Cash at the beginning of the year 2,326,415 2,432,386 105,971 Cash at the end of the year 2,432,386 2,524,503 92,117

Cash flows from Operating Activities

• Operating activities refer to the cash generated by or used in the normal service

delivery functions of the Corporation.

Payments from Operating Activities

• Employee costs comprise approximately 80% of the total cash expenditure

• Small decreases in payments to suppliers based on the anticipated budget result

for 2020/2021.

• Overall, a small increase in Net Cash Flow from Operating Activities is anticipated


Net Cash used in Investing Activities

• The main impact on Investing Activities is increases in Collection Resources.

Cash at End of Financial Year

• It is anticipated that at the end of the 2020/2021 FY the total cash will slightly

increase.

Restricted Funds and working Capital

The cash flow statements show that the Corporation is estimating at 30 June 2021 to

have cash and cash investments of $2,524,503, of which some investments are

restricted:

Employee Benefits – current $1,137,553

Employee Benefits – non-current $ 104,444

These funds are separately identified as restricted to ensure there are sufficient funds to

meet the Corporation’s obligations as set out in the Local Government (Long Service

Leave) Regulations 2002.

The Corporation also has funds set aside in a reserve account to assist with the

replacement of the Radio Frequency Identification (RFID) equipment.


8 Analysis of Capital Works

This section of the report analyses the planned capital expenditure budget for the

2020/21 FY and the sources of funding for the capital budget.

Budgeted Statement of Capital Works

2019-2020 2020-2021 Variance

Capital Works

Collection Resources 1,696,577 1,732,412 35,835

Furniture and Equipment 59,102 64,639 5,537

Motor Vehicle Replacement 25,000 25,000 0

IT Replacement 210,000 210,000 0

Total Capital Works 1,990,679 2,032,051 41,372

Represented by:

Asset renewal expenditure 1,990,679 2,032,051 41,372

Total capital works expenditure 1,990,679 2,032,051 41,372

2019-2020 2020-2021 Variance

Sources of Funding

Council Contributions 1,619,569 1,654,261 34,692

Public Libraries Funding 371,110 377,790 6,680

Total 1,990,679 2,032,051 41,372


Collection Resources ($35,835 increase)

Collection Resources includes capital items such as physical books, audio-visual

resources, e-books and end processing costs. Collection resources are a major asset.

The Corporation continues to focus on improving the relevance and quality of the

collection by regularly evaluating collection borrowing trends, collection condition and

content and replacing the stock. CPI increase plus an additional amount to manage the

anticipated increased volume of reservations of highly popular titles following removal of

charges.

Furniture and Equipment ($5,537 increase)

This assists the replacement of limited amounts of furniture in branch library public areas

and upgrades required to meet current ergonomic and OH&S standards. Smaller items

of equipment are covered in the operating budget under equipment maintenance and

replacement. This budget has been increased by CPI plus an additional amount to

purchase of shelving to accommodate the anticipated increase in reservations.

Information Technology Replacement (no increase)

Information Technology capital expenditure covers the upgrade and replacement of

computer hardware, servers, RFID equipment, network hardware, printers and other

minor hardware items and the purchase of new software. The delivery of a modern

library service requires an IT network and equipment that can support service level

expectations.

85%

3% 11%

1%

Capital Expenditure 2020/2021

Collection Resources

Furniture and Equipment

Motor Vehicle Replacement

IT Replacement


Motor Vehicles (no increase)

The Corporation has a small fleet of cars that are used by all staff when moving between

branches or attending meetings. IT staff regularly use these vehicles when providing

support to branch libraries. The vehicles are used on a daily basis for Outreach and

Makerspace program delivery. 1 vehicle scheduled for replacement.


9 Analysis of Budgeted Financial position

This section of the budget report analyses the movements in assets, liabilities and

equity between 2019/20 and 2020/21.

Budgeted Balance Sheet 2019-2020 2020-2021 Variance

Current assets

Cash assets 2,883,432 2,524,501 (358,931)

Receivables 65,000 65,000 -

Accrued Income 80,000 80,000 -

Prepayments 35,000 35,000 -

Total current assets 3,063,432 2,704,501 (358,931)

Non-current assets

Collection Resources 5,991,056 6,406,131 415,075

IT Equipment, Furniture and Equipment 1,322,455 1,177,559 (144,896)

Total non-current assets 7,313,511 7,583,690 270,719

Total assets 10,376,943 10,288,191 (88,752)

Current liabilities

Payables 531,865 593,079 7,214

Employee benefits 1,592,689 1,624,543 31,854

Other

Total current liabilities 2,124,554 2,217,622 93,068

Non-current liabilities

Employee benefits 102,396 104,444 2,048

Total non-current liabilities 102,396 104,444 2,048

Total liabilities 2,226,950 2,322,006 95,056

Net assets 8,149,993 7,966,125 (183,868)

Equity

Accumulated surplus 4,227,950 4,044,082 (183,868)

Members Contribution 3,922,043 3,922,043 -

Total equity 8,149,993 7,966,125 (183,868)

• Cash assets reducing in 2020/2021 as a result of declining income.

• Collection Resources variance from previous year as a result of depreciation

and write off of items that have been disposed.

• Employee Benefits increase in line with expected wage increase)

• Equity – the net decrease in equity represents the anticipated deficit for

2020/2021.


10 Strategic Resource Plan and Key Financial Indicators

10.1 Plan Development

A five year strategic resource plan is developed and adopted in conjunction with the

annual budget. This strategic resource plan is fundamentally premised on the

Corporation’s commitment to continue the regional library’s operations on a

financially sustainable basis and restricting Council contribution increases

(operational and capital).

Underpinning this commitment are the following objectives:

• Restricting salary increases to industry standard Enterprise Bargaining

increases and corresponding increases in statutory on-costs.

• Continuous pursuit of innovation and efficiency measures to reduce other

expenditure.

• Lobbying wherever possible for increased government funding.

• Maintaining existing service levels with the introduction of affordable service

initiatives.

• Maintaining information communication technology systems within the

parameters of affordability.

• Maintaining a capital expenditure on Collection Resources that meets the

objectives of the Collection Management Strategy and industry standards.

• Prudently managing financial risks relating to assets and liabilities.

• Providing full, accurate and timely disclosure of financial information.

10.2 Funding Strategies

The current Strategic Resource Plan is presented on an accrual basis. It reflects

projected income and expenditure in both capital and operational areas.

The plan is currently premised on the following key parameters:

• Indexation of Council contributions by 2.00% each year

• Indexation of State Government core and local priorities grants by 1.8% each

year

• No increases to the Premier’s Reading Challenge grant

• Interest on investments to remain stable across the five years

• Operating income continues to decline in each year.

• Total operating expenditure to increase by an average of 3% each year


• Employee costs to increase over and above any wage increase to allow for

the increase in Superannuation Guarantee costs each year from July 2021

from 9.5% to 12% in July 2025.

• 2% increase in Collection Resources each year

• 2% Increases in Information Technology, Furniture and Equipment each year

until 2024/25

• 2% increase in Motor Vehicles until 2024/25.

The Corporation reviews these financial parameters each year as part of the annual

budget process and adjusts the financial plan accordingly wherever parameters

have changed.

The Corporation has an extremely tight financial position and limited opportunity to

identify further compensatory discretionary cost items within the operating

expenditure budget to continue to offset lost revenue. While the Corporation is

continually reviewing ways to identify savings, the ongoing reduction of revenue from

user charges and interest presents ongoing challenges when looking to maintain

service levels within current budgets.

The Corporation endeavours to identity additional income sources to delivery

extension services and programs.


10.3 Five Year Financial Plan

2020/2021 2021/2022 2022/2023 2023/2024 2024/2025

Budget Financial Financial Financial Financial

Plan Plan Plan Plan

INCOME

Council Contribution

Whitehorse 5,493,112 5,602,974 5,715,034 5,829,334 5,945,921

Manningham 3,649,156 3,722,139 3,796,582 3,872,514 3,949,964

Total 9,142,268 9,325,113 9,511,616 9,701,848 9,895,885

Public Libraries Grant 1,810,238 1,842,822 1,875,993 1,909,761 1,944,137

Operating Income - WMRLC 297,782 287,543 281,294 275,701 270,716

Grants Local Priorities Funding 95,276 96,991 98,736 100,514 102,323

Premiers Reading Challenge 35,899 35,899 35,899 35,899 35,899

TOTAL INCOME

11,381,463

11,588,367

11,803,538

12,023,723

12,248,960

EXPENDITURE

Operational 9,218,237 9,411,839 9,648,808 9,931,706 10,264,080

Depreciation/Disposal 1,696,343 1,855,759 1,996,504 2,052,572 2,106,916

Grants Local Priorities Funding

95,276 96,991 98,736 100,514 102,323

Premiers Reading Challenge 35,899 35,899 35,899 35,899 35,899

Total Expenditure 11,045,755 11,400,488 11,779,947 12,120,691 12,509,218

Adjustments to AAS27 Budget

Depreciation/Disposal (1,696,343) (1,855,759) (1,996,504) (2,052,572) (2,106,916)

Total less depreciation 9,349,412 9,544,729 9,783,443 10,068,119 10,402,302

Collection Resources 1,732,412 1,767,060 1,802,401 1,838,449 1,875,218

Furniture & Fittings 210,000 214,200 218,484 222,854 222,854

Motor Vehicle Replacement 64,639 59,160 60,343 61,500 62,781

IT Replacement 25,000 25,500 26,010 26,530 27,061

NET SURPLUS (DEFICIT) 0 (22,283) (87,144) (193,730) (341,256)


10.4 Financial Resources Strategic Plan Projections

2020/2021 2021/2022 2022/2023 2023/2024 2024/2025

Operating result 335,708 187,879 23,591 (96,968) (260,257) -

Cash & Cash Investments 2,524,503 2,542,887 2,503,743 2,296,766 2,058,640 -

Cash Flow from Operations 2,124,168 2,084,304 2,068,094 1,942,356 1,949,788 0

Capital Works 2,032,051 2,065,920 2,107,238 2,149,333 2,187,914 +

Key to Forecast Trend: + Forecasts improvement in the Corporation's financial performance/financial position indicator o Forecasts that the Corporation’s financial performance/financial position indicator will be steady - Forecasts deterioration in the Corporation’s financial performance/financial position indicator

The key outcomes of the Plan are as follows:

Financial Sustainability

Cash and investments are forecast to reduce over the five year period to fund library

materials and technology.

Council Contributions Strategy

Indexation of member Council contributions is based on the 2020/2021 rate cap percentage

amount set by the State Government in December 2019.

Capital Works Strategy

Capital expenditure over the five year period will total $10.5 million with $9 million being

spent on library collection materials and $1 million on Information Technology. This allows

for continued renewal of the collection resources and IT and RFID equipment.

Service Delivery Strategy

Reservation charges are proposed to cease as of 1 July 2020. All other existing service

levels will be maintained throughout the five year period.


10.5 Non-Financial Resources

Salary expenses and on-costs represent approximately 82% of the Corporation’s total

operating expenditure (excluding depreciation).

Statement of Human Services

For the years ending 30 June 2021 - 30 June 2025

2019/2020 2020/2021 2021/2022 2022/2023 2023/2024 2024/2025

Forecast Budget Financial Financial Financial Financial

Plan Plan Plan Plan

Staff expenditure Employee costs –operating 7,512,988 7,642,035 7,794,876 7,989,493 8,228,658 8,515,865

Employee costs –capital 0 0 0 0 0 0

Total staff expenditure

7,512,988 7,642,035 7,794,876 7,989,493 8,228,658 8,515,865

Staff numbers

Employees 72.93 72.93 72.93 72.93 72.93 72.93

Total staff numbers

72.93 72.93 72.93 72.93 72.93 72.93

11 Financial Statements

This section presents information in regard to the Financial Statements. The budget information

for the years 2020/21 to 2024/25 has been extracted from the Strategic Resource Plan.

This section includes the following financial statements and the following budgeted information:

• Budgeted Comprehensive Income Statement

• Budgeted Balance Sheet

• Statement of Changes in Equity

• Budgeted Statement of Cash Flows

• Budgeted Statement of Capital Works


11.1 Budgeted Comprehensive Income Statement For the years ending 30 June 2021 – 30 June 2025

2020/2021 2021/2022 2022/2023 2023/2024 2024/2025


Plan Plan Plan Plan

Income

Council Contributions 9,142,268 9,325,113 9,511,616 9,701,848 9,895,885

State Government Grant 1,810,238 1,842,822 1,875,993 1,909,761 1,944,137

Fees and charges 253,782 242,662 235,516 229,008 223,089

Other Grants 131,175 132,890 134,635 136,413 138,222

Interest from Investments 44,000 44,880 45,778 46,693 47,627 Proceeds from sale of assets 0 0 0 0 0

Total Revenue 11,381,463 11,588,367 11,803,538 12,023,723 12,248,960

Expenses

Employee costs 7,642,035 7,794,876 7,989,493 8,228,658 8,515,865

Financial Expenses 32,000 32,640 33,293 33,959 34,638

Utilities 281,113 293,054 305,801 319,119 333,036

Office Expenses 481,327 490,648 500,155 509,852 519,743

Collection Resources 227,361 231,908 236,546 241,277 246,103

Information Services 107,200 109,344 111,531 113,761 116,037

Information Technology 270,000 280,025 290,459 301,318 312,623

Marketing and Programs 102,200 104,244 106,329 108,455 110,625

Headquarters Costs 75,000 75,100 75,202 75,306 75,412

Grant Expenditure 131,175 132,890 134,635 136,413 138,222

Depreciation 1,106,223 1,241,763 1,369,628 1,414,311 1,458,480

Collection Withdrawal 590,120 613,996 626,876 638,261 648,436

Total Expenses 11,045,755

11,400,488

11,779,947

12,120,691

12,509,218

Net Gain (Loss) on disposal of property, - - - - -

plant and equipment

PROFIT/(DEFICIT) FOR THE PERIOD

335,708

187,880

23,591

(96,968)

(260,258)


11.2 Budgeted Balance Sheet For the years ending 30 June 2021 – 30 June 2025

2020/2021 2021/2022 2022/2023 2023/2024 2024/2025


Plan Plan Plan Plan

Current Assets

Cash assets 2,524,501 2,537,885 2,498,740 2,296,763 2,058,639

Receivables 65,000 65,000 65,000 65,000 65,000

Prepayments 80,000 80,000 80,000 80,000 80,000

Accrued Income 35,000 35,000 35,000 35,000 35,000

Total Current assets 2,704,501 2,717,885 2,678,740 2,476,763 2,238,639

Non-Current assets

Collection Resources 6,406,131 6,650,135 6,795,389 6,927,410 7,048,779 IT Equipment, Furniture and Equipment

1,177,559

1,143,716

1,109,196

1,073,936

1,033,565

Total Non-Current assets

7,583,690

7,793,851

7,904,585

8,001,346

8,082,344

Total Assets 10,288,191 10,511,736 10,583,325 10,478,109 10,320,983

Current Liabilities

Payables 593,079 594,165 606,892 562,667 629,102

Provisions 1,624,543 1,657,034 1,690,174 1,723,978 1,758,457

Other - - - -

Total Current Liabilities 2,217,622 2,251,199 2,297,066 2,286,645 2,387,559

Non-Current Liabilities

Provisions 104,444 106,533 108,663 110,837 113,053

Other - - - - Total Non-Current Liabilities

104,444

106,533

108,663

110,837

113,053

Total liabilities 2,322,066 2,357,731 2,405,730 2,397,482 2,500,613

Net assets

7,966,125

8,154,005

8,177,595

8,080,627

7,820,370

Equity

Accumulated surplus 4,044,082 4,231,962 4,255,552 4,158,584 3,898,327 Members Contribution on Formation

3,922,043

3,922,043

3,922,043

3,922,043

3,922,043

Total equity 7,966,125 8,154,005 8,177,595 8,080,627 7,820,370


11.3 Statement of Changes in Equity

For the years ending 30 June 2021 – 30 June 2025

Accumulated Members

Total Surplus Contribution

Budget 2021

Balance at beginning of the financial year 7,630,417 3,708,374 3,922,043

Surplus (deficit) for the year 335,708 335,708 0

Balance at end of the financial year 7,966,125 4,044,082 3,922,043

2022 - SRP




2023 - SRP




2024 - SRP


Surplus (deficit) for the year (96,969) (96,968) 0


2025 - SRP


Surplus (deficit) for the year (260,258) (260,258) 0



11.4 Budgeted Statement of Cash Flows For the years ending 30 June 2021 – 30 June 2025


Plan Plan Plan Plan

Cash flows from Operating Activities

Contributions Received 9,142,268 9,325,113 9,511,616 9,701,848 9,895,885

Grants Received 1,810,238 1,842,822 1,875,993 1,909,761 1,944,137

Interest received 44,000 49,880 45,778 41,693 47,627

Library Fees 131,175 132,890 134,635 136,413 138,222

Other Grants 253,782 242,663 235,516 229,008 223,089

Payments to Employees/Supplies

(9,257,295)

(9,509,064)

(9,735,444)

(10,076,367)

(10,299,172)

Net cash provided by operating activities

2,124,168

2,084,304

2,068,094

1,942,356

1,949,788

Cash flows from Investing Activities Payments for library collection, furniture and IT equipment

(2,032,051)

(2,084,304)

(2,107,238)

(2,149,333)

(2,187,914)

Net cash from Investing Activities (2,032,051) (2,084,304) (2,107,238) (2,149,333) (2,187,914)

Net increase (decrease) in cash held 92,117 18,384 (39,144) (206,977) (238,126)

Cash at the beginning of the year 2,432,386 2,524,503 2,542,887 2,503,743 2,296,766

Cash at the end of the year 2,524,503 2,542,887 2,503,743 2,296,766 2,058,640

Reconciliation of Operating Result and Net Cash Flows from Operating Activities

For the year ending 30 June

Net surplus (deficit) from operations

335,708

187,880

23,591

(96,968)

(260,258)

Depreciation 1,106,223 1,241,763 1,369,628 1,414,311 1,458,480

(Profit) Loss on sale of Library Collection, Furniture and IT Equipment 590,120 613,996 626,876 638,261 648,436 Net movement in current assets and liabilities 92,117 40,665 47,999 (13,248) 103,130 Net cash inflow (outflow) from operating activities

2,124,168

2,084,304

2,068,094

1,942,356

1,949,788

Cash Resourcing

Cash Assets

2,524,503

2,542,887

2,503,743

2,296,766

2,058,640 Less Bank Overdraft at the end of the year - - - - -

2,524,503

2,542,887

2,503,743

2,296,766

2,058,640


11.5 Budgeted Statement of Capital Works For the years ending 30 June 2021 – 30 June 2025

2020/2021 2021/2022 2022/2023 2023/2024 2024/2025


Plan Plan Plan Plan

Collection Resources 1,732,412 1,767,060 1,802,401 1,838,449 1,875,218

IT Replacement 210,000 214,200 218,484 222,854 222,854

Furniture and Equipment 64,639 59,160 60,343 61,500 62,781

Motor Vehicles Replacement 25,000 25,500 26,010 26,530 27,061

Total capital works

2,032,051

2,065,920

2,107,238

2,149,333

2,187,914

Represented by:

Renewal

2,032,051

2,065,920

2,107,238

2,149,333

2,187,914

- - - -

Total capital works

2,032,051

2,065,920

2,107,238

2,149,333

2,187,914

The movement between the previous year and the current year in Library Collections; Furniture and IT Equipment as shown in the Balance Sheet links to the following items;

Total capital works

2,032,051

2,065,920

2,107,238

2,149,333

2,187,914

Asset revaluation movement - - - - -

Depreciation and amortisation

(1,106,223)

(1,241,763)

(1,369,628)

(1,414,311)

(1,458,480)

Collection withdrawn

(590,120)

(613,996)

(626,876)

(638,251)

(648,436) Net movement in Library Collection, Furniture and IT Equipment

335,708

210,161

110,734

96,771

80,998


Appendix A: Fees and Charges

2019/2020 Draft 2020/2021

Overdue Charges - Adult items 35c per day 35c per day

Overdue Charges - Children items 20c per day 20c per day

Maximum Overdue charge per item cost of item cost of item

Maximum Overdue charge per Member no limit no limit

Lost/totally damaged items Item cost plus $15.20 admin

charge Item cost plus $15.30

admin charge

Damaged Items (minor repairs inc. RFID tag replacement)

$5.30 $5.40

Debt Collection Charge (plus debt) $17.60 $17.70

Replacement Membership Card $3.50 $3.60

Reservations $2.20 $0.00

Inter Library Loans – standard fee $11.10 $11.10

Inter Library Loans – from State, University or Special Library (physical loan)

$27.50 $28.50

Inter Library Loans – from State, University or Special Library (electronic copies)

$18.50

Fax Services - Victoria $3.00 first page, $1.10 ea

following page $3.00 first page, $1.10 ea

following page

Fax Services - Interstate $3.30 first page, $1.10 ea


following page

Fax Services - International $5.00 first page, $3.30 ea


following page

Received fax 50c per page 50c per page

Photocopying/Printing - Black & White A4 30c / A3 50c A4 30c / A3 50c

Photocopying/Printing - Colour A4 $1.30 / A3 $2.00 A4 $1.30 / A3 $2.00

Scanning 20c per page 20c per page

Library Bags $2.00 $2.00

Earbuds $2.50 $2.50

USB 8G $8.20 $8.30

Page markers $1.10 $1.10

Microfiche Reader Printing A4 30c / A3 50c A4 30c / A3 50c

Meeting room rates 4% increase

Small meeting space $10 per hour

Meeting Rooms Set Up fees $52 per session $52 per session

Training Room PC Setup $165 per hour $165 per hour

Administration fee for room bookings $26.00 $26.00

Booking fee: Children’s School Holiday Programs Up to $5.00 per child Up to $5.00 per child

Makerspace programs Up to $10.00 per person Up to $10.00 per person

Booking fee: Adult Programs – selected special events and high profile authors

Up to $15.00 per booking Up to $15.00 per booking


Appendix B: Budget Process This section lists the budget processes to be undertaken in order to adopt the Budget in

accordance with the Local Government Act 1989 (the Act) and Local Government (Planning

and Reporting) Regulations 2014 (the Regulations).

Under the Act, the Corporation is required to prepare and adopt an annual budget for each

financial year. The budget is required to include certain information about the fees and

charges that the Corporation intends to levy as well as a range of other information required

by the Regulations which support the Act.

The 2020/21 Budget, which is included in this report, is for the year 1 July 2020 to 30 June

2021 and is prepared in accordance with the Act and Regulations. The Budget includes

financial statements being a Comprehensive Income Statement, Balance Sheet, Statement

of Changes in Equity, Statement of Cash Flows and Statement of Capital Works. These

statements have been prepared for the year ending 30 June 2021 in accordance with the Act

and Regulations, and consistent with the annual financial statements which are prepared in

accordance with Australian Accounting Standards. The Budget also includes information

about the fees and charges to be levied, the capital works program to be undertaken, the

human resources required, and other financial information the Board requires in order to

make an informed decision about the adoption of the Budget.

In advance of preparing the budget, officers first review and update the Corporation's long

term financial projections. Financial projections for at least four years are ultimately included

in the Corporation’s Strategic Resource Plan, which is the key medium-term financial plan

produced by the Corporation on a rolling basis. The preparation of the Budget, within this

broader context, begins with officers preparing the operating and capital components of the

annual budget during December to February.

With the introduction of the State Government Rate Capping legislation in 2015, the annual

rate cap percentage amount forms the basis of the indexation of the member Councils annual

contributions to the regional library.

A ‘proposed’ Budget is prepared in accordance with the Act and submitted to the Board

meeting in February whereby the Board approves the draft Budget, in principle, which is then

advertised publicly.


The draft Budget is placed on public exhibition seeking submissions from the community. Any

person has a right to make a submission on any proposal contained in the budget under

Section 221 of the Act.

The final step is for the Board to adopt the Budget after receiving and considering any

submissions from interested parties. The Budget is required to be adopted by 30 June and a

copy submitted to the Minister within 28 days after adoption.

The key dates for the budget process are summarised below:

Minister of Local Government announces maximum rate

increase.

Dec

Budget preparation by Corporation officers Dec/Feb

Proposed budget presented to the Board for approval to

advertise

March 2020

Public notice advising intention to adopt budget March/April 2020

Budget available for public inspection and comment April/May 2020

Submission period closes (28 days) May 2020

Budget and submissions presented to the Board for

adoption

May 2020

Copy of adopted budget submitted to the Minister June 2020

Documents

Whitehorse Manningham Regional Library Corporation ... › files › Corporation › ... · Statement of Capital Works, Budgeted Balance Sheet and Budgeted Cash Flow Statement are