The Financial Report and Standard Statements
The accompanying financial report for the year ended 30 June 2009 of Melbourne City Council which comprises of Income Statement, Balance Sheet, Statement of Cash Flows, Statement of Changes in Equity, a summary of significant accounting policies and other explanatory notes to and forming part of the financial report, and the Statement by Councillors, Chief Executive Officer and Principal Accounting Officer on the Financial Report has been audited.

The accompanying standard statements for the year ended 30 June 2009 of the Council which comprises of Standard Statement of Income Statement, Standard Statement of Balance Sheet, Standard Statement of Cashflow, Standard Statement of Council Works, the related notes and the Statement by Councillors, Chief Executive Officer and Principal Accounting Officer on the Financial Report have been audited.

The Councillor's Responsibility for the Financial Report and Standard Statements
The Councillors of the Melbourne City Council are responsible for the preparation and the fair presentation of:

• the financial report in accordance with Australian Accounting Standards (including the Australian Accounting Interpretations) and the financial reporting requirements of the Local Government Act 1989
• the standard statements in accordance with the basis of preparation as described in note 1 of the statements and the requirements of the Local Government Act 1989.

This responsibility includes:

• establishing and maintaining internal controls relevant to the preparation and fair presentation of the financial report and standard statements that are free from material misstatement, whether due to fraud or error
• selecting and applying appropriate accounting policies
• making accounting estimates that are reasonable in the circumstances.

Auditor's Responsibility
As required by the Audit Act 1994, my responsibility is to express an opinion on the financial report and standard statements based on the audit, which has been conducted in accordance with Australian Auditing Standards. These Standards require compliance with relevant ethical requirements relating to audit engagements and that the audit be planned and performed to obtain reasonable assurance whether the financial report and standard statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial report and standard statements.The audit procedures selected depend on judgement, including the assessment of the risks of material misstatement of the financial report and standard statements, whether due to fraud or error. In making those risk assessments, consideration is given to the internal control relevant to the entity's preparation and fair presentation of the financial report and standard statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity's internal control. An audit also includes evaluating the appropriateness of the accounting policies used, and the reasonableness of accounting estimates made by the Councillors, as well as evaluating the overall presentation of the financial report and standard statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide a basis for my audit opinion.

Matters relating to the Electronic Presentation of the Audited Financial Report and Standard Statements
This auditor's report relates to the financial report and the standard statements published in both the annual report and on the website of the Melbourne City Council for the year ended 30 June 2009. The Councillors of the Melbourne City Council are responsible for the integrity of the website. I have not been engaged to report on the integrity of the website. The auditor's report refers only to the statements named above. An opinion is not provided on any other information which may have been hyperlinked to or from these statements. If users of this report are concerned with the inherent risk arising from electronic data communications, they are advised to refer to the hard copy of the audited financial report to confirm the information included in the audited financial report presented on the Council's website.

Independence
The Auditor-General's independence is established by the Constitution Act 1975. The Auditor-General is not subject to direction by any person about the way in which his powers and responsibilities are to be exercised. In conducting the audit, the Auditor-General, his staff and delegates compiled with all applicable independence requirements of the Australian accounting profession.

Auditor's Opinion
In my opinion:

• the financial report presents fairly, in all material respects, the financial positions of Melbourne City Council as at 30 June 2009 and its financial performance and cash flows for the year then ended in accordance with applicable Australian Accounting Standards (including the Australian Accounting Interpretations), and the financial reporting requirements of the Local Government Act 1989.
• the standard statements present fairly, in all material respects, in accordance with the basis of preparation as described in note 1 to the statements and comply with the requirements of the Local Government Act 1989.

D.D.R Pearson
Auditor-General

Melbourne
2 September 2009