Agenda item

To receive, consider and comment on the draft Statement of Accounts for the year ended 31 March 2015

The Corporate Director Resources and Financial Services Manager introduced a report to Audit Committee Members, which had been informed by the regular pattern of reporting on the Council’s financial position.  The Corporate Director Resources also advised Audit Committee Members that the accounts must be signed and certified by 30 June 2015, by the Council’s Section 151 Officer (Corporate Director Resources), in accordance with the Accounts and Audit Regulations 2011.

The key points within the report included:

·         Format of the Accounts;

·         Comprehensive Income and Expenditure Statement;

• Balance Sheet at 31 March 2015;

·         Reserves and Balances;

·         Schools;

·         Audit Fee; and

·         Next Steps - approval, signing, inspection and audit.

The Corporate Director Resources and Financial Services Manager responded to comments and questions raised by Members.  In summary responses included:

·         The increased deficit figures for pensions fund actuary assumptions had been due to the mortality rate of scheme members and investment market performance;

·         The pensions fund deficit shown in the statement of accounts reflected the amount that the Council would be required to meet if pay out was required immediately;

·         The pensions fund actuary had completed a valuation every three years and had recommend that the Council make a lump sum investment each year over the next three years alongside a reduced contribution rate;

·         Foundation school (FS) assets had been included on the Council’s balance sheet as a result of a clarification paper produced by The Chartered Institute of Public Finance & Accounting (CIPFA).  This amendment to the accounts better reflected the legal position if foundation schools ceased to operate in their current form and the responsibility for the school asset should come back into direct Local Authority control;

·         The Council held a duty to monitor foundation school finances, however, cannot access school balances and reserves.  The responsibility for FS funds remained with head teachers, despite the amendment in accounting treatment and presentation;

·         The statement of accounts did not contain any figures on schools performance, only on the types of school within the Local Authority area;

·         The £78.8m loan amount had been taken out to support the Council’s capital programme, which would support initiatives such as the energy for waste project.  An affordability review was produced annually as part of the Medium Term Financial Strategy (MTFS) which assessed the implications of the Council’s borrowing commitments and proposals;

·         The sale of Council’s assets could not be relied upon to offset the Authority’s borrowing amount, as there were certain buildings and assets that could not be utilised in respect of lowering the financial commitment, such as the sale of the Town Hall; and

·         The Council was obliged to publish a disposal asset plan as part of the budget as contained within the Medium Term Financial Statement (MTFS).

      The Committee:

      Reviewed and commented on the Statement of Accounts prior to the Chief           Finance Officer’s certification by the 30 June 2015.

      The Committee also agreed that:

That the Service Director of Financial Services would provide a briefing note to Members of the Audit Committee to outline the implications of the Bourges Boulevard developments completion delay to include:

• Estimated completion date for the works;
• How the project was being financed, including which external grants had been secured; and
• Whether the additional timescale had impacted on the cost of the scheme.