Agenda item

The Statement of Accounts are attached.

The Assistant Director of Resources (Finance and Efficiency) presented a report providing Members with details of the Authority’s audited Statement of Accounts for the financial year ended 31 March 2014.

 

The pre-audited Statement of Accounts had been approved by the Responsible Finance Officer on 5 June 2014. The accounts had since been audited and Members of the Audit Committee noted that:-

 

·         Only one audit adjustment had been identified that was presentational and did not have an impact on the Council’s revenue, capital or HRA outturn for 2013/2014;

 

·         Two other audit adjustments had been identified that do not require correcting due to the immaterial impact on the accounts;

 

·         Six recommendations had been made. The auditors had classed two as high priority, one as medium and three as low. Actions were being taken to address these;

 

·         The quality of the Council’s accounts and working papers have remained at a high level;

 

·         For the first year the Council has presented its audited accounts to Members 2 ½ months earlier than the statutory deadline and KPMG are to be thanked for their part in achieving this;

 

·         A notice will be placed advertising the completion of the audit and how member of the public may access copies of the statement and the summary of accounts.

 

Those present were given the opportunity to make comments and ask questions and the following points were raised:-

 

·         Councillor Heneghan referred to the changes in the way that business rates are collected and distributed and asked whether the Council was better or worse off than previous years.

 

Steve explained that the Council had received a top up payment that had brought the level of income back up to where it had been in previous years. He also explained that the new way of collecting and distributing meant that the risk had been transferred to the Council should local businesses fail and business rates not be available. Likewise the Council now has to fund 50% of the impact of appeals.

 

·         Council Mallon referred to the significant recommendation in relation to classification of assets under construction and asked at what point did as asset under construction become operational.

 

Trevor Rees explained that this was still a grey area but for audit purposes it would usually be when the building became habitable.

 

Steve explained that the Council was working to produce a policy to cover these sorts of situations and that they would be working to agree this with KPMG for future audits.

 

·         Councillor Parnell asked about the Housing Revenue Account and whether surplus monies collected were ring-fenced to the housing stock and, if so what was this was used for.

 

Steve explained that the HRA was a ring-fenced account and that any surplus monies could only be spent in respect of Council Housing. A Housing Strategy had been approved by the Council in February which identified additional investment to bring stock up to the “Bury Standard” (ie 100% decency).

 

·         Councillor Heneghan referred to the revenue support grant reducing and asked whether this raised the emphasis on council tax.

 

Steve explained that the balance of funding was shifting; away from Grant, and towards Local Taxation.

 

·         Councillor Parnell referred to the changes to Council Tax support.

 

Steve explained the changes that had been introduced and the reduced level of funding available. It was explained that additional tax had been raised through second and empty homes to compensate for this.

 

·         A question was asked around the amount of debt compared to the previous year and the fact that this figure had risen.

 

Steve explained that at the end of 2013 the Council had repaid £7.5m worth of loans, and these were not replaced until later in 2014. The cost of servicing the new loans was also less that the repaid ones.

·         Councillor Walker referred to specific figures within the Income & Expenditure Statement for Adult Care Services income, and queried why this had reduced.

 

Further analysis to be provided after the meeting.

 

·         Councillor Walker also asked about the funding that had been transferred to the Council when the Public Health responsibility had transferred and asked whether this was working well.

 

Steve explained that there was £8m transferred with the Public Health responsibility of which around £1m would be staffing, the rest was tied up with other contracts and services. These would have been NHS contracts which the Council were now going through systematically as they came up for renewal.

 

·         Councillor Mallon referred to the balance sheet and the figures presented in relation to Townside Fields and asked why there was a drop in this figure.

 

Steve explained that one of the two buildings owned by the Council had been sold and the Council had retained the other.

 

·         Councillor Heneghan referred to property and land owned by the Council and asked where happened to a school's land and buildings when it became an academy.

 

It was explained that the asset would still belong to the Council and would be rented back to the school for a peppercorn rent.

 

·         Councillor Walker asked about the calculation that was used when working out depreciation and how some assets had between 8 and 68 years recorded.

 

It was explained that the assets were broken down into different components, some would last longer than others, so a boiler may have 15 years and windows 25 years.

 

·         Councillor Mallon asked about the Council owned artworks and whether the Council loaned out its artworks and if so how were they insured when this happened.

 

Steve explained that a lot of the Council owned art was loaned and when it was under a loan agreement it was up to the organisation borrowing it to ensure that it was kept in the correct conditions and insured satisfactorily.

 

Delegated decision:

 

1.           That the one presentational amendment to the Accounts recommended by KPMG be approved.

 

2.     That the final version of the Statement of Accounts for the 2013/2014 financial year be approved in line with the provisions of the Accounts and Audit Regulations (England) 2011.

 

3.     That the matters and issues arising from the audit and contained within the ISA (UK+I) 260 Financial Statement Report presented by KPMG be noted.

 

4.     That the letter of representation signed by the Assistant Director of Resources (Finance and Efficiency) which was presented at the meeting be approved.

 

5.     That KPMG be thanked for their support and advice during the audit process.