As part of Council’s “due diligence” on this project, Council engaged the services of KPMG to lead councilors and staff through a risk assessment review of the financial strategy for this project.
The risk assessment process identified twelve (12) risk factors that may affect the total cost of the leisure centre.
The twelve risk factors are as follows:-
(i) Increased construction costs
(ii) Increased cost of professional services
(iii) Identified sites not being available for sale
(iv) Sale price(s) less than estimates
(v) Development costs greater then estimates
(vi) Increased amount of borrowings
(vii) Extended period of borrowing
(viii) Higher interest rate (on borrowings)
(ix) Higher cost of Community Benefits package
(x) Timing of contributions from Landcom
(xi) Inability to obtain loan funding
(xii) Opportunities for additional funding
Each of the risk factors has been reviewed and proposed “treatments” or action to minimise the impact of the risk factors, has been developed. These “treatments” will form the basis of council’s risk management strategy for the financial management of this project.