Morse Group audit partner Jeff Shanks has pronounced that the council is in a “strong financial position” and “should be congratulated”.

The financial result could take the wind from the sails of people critical of the council’s financial position in the past.

Mr Shanks stood before the council earlier this month to deliver the rosy results to the councillors, council staff and the public gallery.

The council returned a $7.7 million surplus in the 2008/09 financial year. This profit was up from $4.5 million last year.

This set it apart from other councils - and the NSW Government - which had returned deficits and was a typical result for Dubbo, Mr Shanks said.

Dubbo has $52.6 million in borrowings, but that’s not a concern for its auditor.

“7.8 per cent of its guaranteed income goes to pay loans,” Mr Shanks said.

“The department is happy with anything less than 10 per cent.”

Mr Shanks likened the council’s loans - drawn for the water treatment plant works, the tiered theatre and others - to the ordinary man or woman’s home loan.

While the person had income, the bank was not going to shut down the borrower, he said.

Dubbo also performed well in a number of key ratios.

For every $1 in liabilities, the council has $4.10 in assets, giving it an unrestricted current ratio of 4.1 to one.

“Anything greater than a ratio of two to one is considered strong,” Mr Shanks said.

The council has a rates coverage ratio of 40.55 per cent and a user charges ratio of 32 per cent.

“It’s guaranteed about 70 per cent of its income each year,” Mr Shanks said.

It also appears there was no shadow on the result, with Mr Shanks saying there was nothing in it to concern him.

“This is a strong result, Dubbo continues to go from strength to strength,” he said.

“It’s managing its debt and doing everything it should be doing.”

Mr Shanks is singing a different song from Cr Ben Shields who has warned the council is in dangerous financial waters.

In January Cr Shields said the level debt was $55 million, which was “disgusting”.

Mr Shanks has been the sign-off audit partner for four years, but has been involved in the process for 15 years.

The audit of Dubbo is the Morse Group’s second largest job out of 25 councils across NSW on the firm’s books.

faye.wheeler@ruralpress. com