Long-Term Financial Planning

This web page provides an introduction to long-term financial planning and refers you to further information.

 The Long-term Financial Plan is one of the most important documents to be produced by a water supply system. It should chart the financial course of the organization for a period in the future of at least 25 years. All water systems have a range of important tangible assets such as pipes, pumps and reservoirs. Eventually these assets reach the end of their useful life and must be replaced.  Replacement of these assets is costly; it is important to plan ahead so that there is enough money available when major capital expenditures become necessary. The Long-Term Financial Plan should show how this will happen. 

Several other resources will contribute to the Long-Term Financial Plan. These may include:

 Contents of a Long-Term Financial Plan

The Long-Term Financial Plan may typically include the documents above, or will refer to them extensively. It may also include topics such as the following:

Access to Funding: How will money be found to pay for operating and capital costs? Will expenditures be financed from revenues, from borrowings or from grants? 

Governance Structure: What is the governance structure and how does this impact the ability to raise funds and manage finances?

Cost of Improvements: What is the nature and costs of planned improvements for items such as water treatment equipment?