Agenda item

Draft Statement of Accounts (Agenda item 6)

Report of the Head of Finance.


Revised copies of the draft Statement of Accounts were circulated.


The Head of Finance and the Accountancy Manager presented the draft report. 


The Accountancy Manager had carried out a tremendous amount of work over the year to bring this Statement of Accounts to the Committee.


As the next Audit Committee meeting was on the 25th June, there was not much time to make many changes to the document; therefore it was recommended that the final document would not be issued as a hard copy with the Agenda papers but would be published on the website in advance of the meeting.  Hard copies would then be circulated at the meeting on 25th June.


The Accountancy Manager summarised the explanatory foreword.


The Head of Finance, together with the Accountancy Manager, explained the various statements included in the document, drawing attention to the key figures and the variances over the previous year.  This covered accounting changes to the Collection Fund, particularly in relation to PFI Schemes, the Income and Expenditure Account, the Statement of Movement on the General Fund balance, the Statement of Total Recognised Gains and Losses the Balance Sheet and the notes to the Core Financial Statements.


Referring to one of Councillor Hewett’s written questions, with regard to the increase in the pension deficit and whether this would be a future cash flow liability to the Council, Members were informed that the pension reserve had been based on FRS17 requirements and was an accountancy treatment rather than a cash flow.  It was noted that the Income and Expenditure account FRS17 entries had been reversed out in the Statement of Movement on the General Fund balance.


Another question related to Mr Hewett’s understanding on why the capitalisation amount of £3,883k was effectively a debit in the Income and Expenditure account.  The Head of Finance explained that this was a reversal of the entries posted to the Financial Instruments Adjustment Account which the Council had adopted (in line with CIPFA Guidance) to defer.the impact of the impairments on the General Fund.


With regard to Note 15 – Fixed Assets (page 148 of the report), Mr Hewett wished to know if the columns marked £’000 for Council dwellings and Community assets were necessary.  It was noted that this had been shown in this way to demonstrate to the public that the Council did not own any council houses or community assets.  A  Member felt that this would be very useful for the public when comparing authorities.


Further questions/observations made by Councillor Hewett relating to the Statement of Accounts were answered.


The wording relating to the lease notes would be tidied up to make it clearer to the reader.


The pension liability and movement in the Statement of Total Recognised Gains and Losses was confirmed as being correct.


The overall reduction in employee remuneration above £50k was a result of headcount for staff in this category reduced from 14 to 12.


ARP was taking steps to recover NDR debts, while the amounts owing from the Government department would be paid in accordance with established repayment timetables.  The Head of Finance confirmed that the financial instrument tables had been presented in accordance with CIPFA Guidance and had been verified with the Council’s Treasury Management Advisors.


Referring to the notes to the Core Financial Statements with regard to the Capitalisation Directive, it was pointed out that the decision to agree the accounting treatment in relation to the Capitalisation, following the meeting of the Council in February, had been agreed that the decision be delegated to the S151 Officer in consultation with the Chairman of Audit and the Portfolio Holder.  A meeting would be arranged prior to the formal sign off of the Accounts.




1)           the final accounts be submitted for the Audit Committee’s approval; and


2)           a meeting be held prior to the formal sign off of the Statement Accounts with the S151 Officer in consultation with the Chairman of Audit and the Portfolio Holder to discuss the Capitalisation Directive arrangements.


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