East Freo community park plunges council into money troubles
The OAG wants the town to re-do its financial statements to include income and losses from the recently opened East Fremantle Community Park, which town staff have warned will have an impact on their operations.
It has already had an effect, with staff having to delay a report on the town's spending.
The council agreed at its July 15 meeting to put off its June financial statement until next month.
Financial statements are intended to let the council know what it is spending money on. Under the Local Government (Financial Management) Regulations 1996, they have to be presented within two months after the end of each month.
A council report said a 'significant amount of work' had been needed to finalise the town's end-of-year accounts and more time was needed for the June report.
Acting CEO and corporate services executive manager Peter Kocian told the meeting that monthly statements had been deferred in the past, but forewarned of more workload issues thanks to the request from the OAG. 1500 locals celebrated the opening of East Fremantle Park. Credit: The East Fremantle Community Park
He said he had been in 'lengthy discussions' with the OAG about the accounting treatment of the operations of East Fremantle Community Park.
'We are dealing with a fairly significant issue with the Office of the Auditor-General at the moment, which will impact on the presentation of the town's accounts for the 2024-25 financial year,' he said.
'They will be looking to impose requirements on the town to recognise the consolidated position of the operations of East Fremantle Community Park in the town's financial accounts, meaning that effectively we need to recognise all of the revenues and expenses of East Fremantle Community Park in our statement of comprehensive income, as well as recognise the balance sheet position of East Fremantle Community Park in our statement of financial position.
'So there is certainly some limitations in terms of the reporting that (park operator) Belgravia can provide to the town and it's up in the air at the moment as to whether or not they will be able to meet those requirements.
'We're working through that negotiation with the Office of the Auditor-General.'
He said staff would update the town's audit committee at its August meeting.
Deputy mayor Tony Natale said it was more work for local government created by the Office of the Auditor-General.
'That's disappointing to hear,' he said.
''I daresay you might need some more assistance.'
An OAG spokesperson said to comply with Australian Accounting Standards, entities must include all transactions from activities/operations they control in their financial statements.
'Accordingly, the Town of East Fremantle will need to include transactions from the operation of the East Fremantle Community Park in its financial statements,' they said.
Town of East Fremantle CEO Jonathan Throssell told PerthNow the town had not yet received final written advice from the OAG.
'However, as we are finalising our audit, it has been flagged by the OAG that accounting and auditing requirements will need to be more prescriptive for the East Fremantle Community Park,' he said.
'This will require the town to incorporate the East Fremantle Community Park within the auditing regime to a far greater extent than had been previously considered, and will create a cost and resourcing impact on both the town and Belgravia Leisure.'
The East Fremantle Community Park, which opened last year after a $32 million revamp, is intended to be a cost-neutral possession for the council.
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