The Queenstown Lakes District Council's surplus in the past financial year was 50% higher than budgeted.
The $40.1 million surplus in the year to June 30 was well above the budgeted surplus of $26.7 million as well as the $30.3 million surplus it recorded in the previous year.
Councillors will adopt the annual report tomorrow at what is their final meeting of the council term.
A requirement of the Local Government Act, it compares actual council performance with its intended performance as set out in the annual and long-term plans.
The higher surplus was the result of operating revenue being $3 million higher than budgeted, as well as $9.3 million of unrealised net gains on the revaluation of council assets and a $15 million realised gain on the sale of council development property in Wanaka.
However, operating expenditure was $12.7 million over budget, of which more than 50% of the difference was costs incurred in resolving building-related legal claims against the council.
Exceeding their budgeted figures were staff-related costs ($481,000), depreciation expenses ($1.4 million), cost of professional services ($1.1 million), road maintenance costs ($1.2 million) and solid waste handling ($1.1 million).
Interest expenses were $2.7 million lower than budgeted.
Capital expenditure was $14.4 million lower than estimated, mainly as a result of the reprogramming of major projects.
A budgeted $4.1 million for the Eastern Arterial Road was shifted into the current financial year, $2.2 million set aside for a council convention centre was not spent because the project is on hold, while $6.8 million budgeted for the Wanaka Aquatic Centre was also moved into the current year.
Borrowings were $44.5 million below forecast because of reduced capital expenditure in the past two financial years and the sale of land at Scurr Heights in Wanaka.
Total council debt at June 30 was $75.9 million compared to a forecast figure of $120.4 million.
In her report for councillors, financial controller Lyn Zeederberg said the council had complied with all but two internal or external financial limits and benchmarks, with those being the result of the cost of building-related legal claims.
Council auditors Deloitte were expected to provide an unqualified opinion on the report by tomorrow, Ms Zeederberg said.
Council communications manager Michele Poole said it had been necessary to call a meeting tomorrow to adopt the annual report because it had taken Deloitte longer than expected to complete its work.
That had provided an opportunity for other matters to be ''tacked on'' to the meeting's agenda, Ms Poole said.
As well as the annual report, the 317-page agenda contains eight other topics for councillors to consider.
