[Andrew Butcher]

LGNSW are advocating for changes to the accounting for red fleet assets, this has been an on-going issue for a number of years and been a matter of contention at many councils.

Essentially there is a difference of opinion regarding RFS assets being recognised in local governments financials.

On behalf of LGNSW it would be appreciated if you could refer the attached documents onto your Finance Manager.

If you have any questions please do not hesitate to contact Shaun McBride (9242-4072) or myself.

Regards,
Andrew

Attachment 1 FA 1753 Leeton Shire Council – Letter from the Auditor-General to GMs – RFS Assets

Attachment 2 DPE_LETTER_JUNE_7_2022

Attachment 3 LGNSW Member Update RFS 24 June 2022

Attachment 4 LGNSW Letter to Ministers Treasurer and Auditor General re Accounting Treatment of RFS Mobile Assets

Attachment 5 LSC RFS Assets Ltr to Auditor General Signed 30 August 2020

Attachment 6 2020.09.01 RAMJO to Auditor General – RFS Assets

Attachment 7 Albury CC RFS Accounting Treatment Position Statement

Attachment 8 Bland Shire Position Statement on Tretment of RFS Assets

Attachment 9 AO letter of response to Bland Shire Council – RFS Assets

Attachment 10 RFS MLP_Tenterfield Response

Attachment 11 Leeton Final Management Letter 2021.pdf

Attachment 12 Coolamon 22 13761 May 2022 Minutes – Audit Report – GM2

Attachment 13 Wagga Wagga Performance Audit on the Planning and Managing of Bushfire Equipment

Attachment 14 Leeton Shire Council endorsement 23 June 2022 of ARIC recommendations on RFS matters

Attachment 15 Murray River Report May 2022 on RFS Asset recognition

Attachment 16 Letter from Leeton Shire Council to AO re RFS assets 29 Nov 2021

Attachment 17 Tech Acct Advice BDO_Leeton SC_Fire Services Equipment_NSW AO update_FINAL

Attachment 18 LG Code of Accounting Practice and Financial Reporting 2021-22 – Page 54

[Andrew Butcher]

Latest correspondence from LGNSW:

Dear Andrew,
As you will all be aware, the Auditor General has followed up her 2021 Local Government Report released last month with a letter to General Managers ‘recommending’ councils “undertake a stocktake of the rural firefighting equipment vested to councils and record the value in the council’s financial statement” – see an example sent to Cabonne Council. We suspect the Auditor General has established this requirement to create a trigger to issue qualified audit opinions to non-conforming councils in 2022.

Notwithstanding the Auditor General’s ‘recommendation’, we note correspondence addressed to the Auditor General from the Secretary of the Department of Planning and Environment dated 7 June 2022 stating: “the State’s position is that it does not control RFS assets. Councils need to assess whether they control any rural firefighting equipment in accordance with Australian Accounting Standards”. The correspondence also makes clear that “The Minister for Local Government (does) not have legal authority to direct councils in this matter”.

You would have received our 24 June Member Message advising you LGNSW immediately wrote to the Auditor General, Treasurer, Minister for Local Government and Minister for Emergency Services expressing the sector’s strong objection to the determination that RFS assets are the property of councils for accounting purposes. We called on the Government to acknowledge rural firefighting equipment is vested in, under the control of, and the property of the RFS, thereby clearing up this mess once and for all. See a copy of our letter to Government here.

Since then, we have been heartened by feedback from a number of councils who have already written to the Auditor General, advising they have determined they do not control any rural firefighting equipment in accordance with Australian Accounting Standards and will not be undertaking a stocktake. If your council has yet to form an opinion on the issue of RFS asset control, we urge you to do so as early as possible and to communicate that to the Auditor General.

We particularly encourage councils on the metropolitan fringe who may not have examined the matter for a number of years to consider whether they are in a position to discontinue recording RFS assets on financial statements. We are aware that the vast majority of rural and regional councils, who are disproportionately affected by the Auditor General’s and Government’s position, would be grateful for this support and solidarity.

We also encourage all councils, including metropolitan councils not directly affected to move Mayoral Minutes in support of their fellow councils who are impacted. To assist, LGNSW has prepared a template Mayoral Minute and accompanying report. This template resolves to write to several members of the Government, Opposition and cross benchers, with contact details located here.

We believe the more Members of Parliament who are made aware of this shameless cost-shift onto local government, the greater the likelihood of affirmative action – and it is our hope that the Auditor General and the Government receive 128 letters (one for each of NSW’s general purpose councils) notifying them that the relevant council has formed the opinion they do not control any firefighting equipment and will not be undertaking a stocktake of RFS assets.

In closing, I would like to acknowledge the considerable efforts and support of Local Government Professionals CEO Vicki Mayo, Secretary/Public Officer of Country Mayors Kent Boyd (his ‘other hat’), Leeton Council General Manager Jackie Kruger and Revenue Professionals NSW Chair Andrew Butcher. Each of these organisations continues to work closely with LGNSW in seeking Government recognition – once and for all – that rural firefighting equipment is vested in, under the control of and the property of the RFS.

Thank you in anticipation for your support. If you have any questions or concerns, please don’t hesitate to call/email.
Kind regards,
Scott Phillips
Chief Executive

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