Agenda item

The Director for Corporate Services to submit a report seeking approval for the Statement of Accounts for 2019/20, which have been prepared in accordance with the Accounts and Audit Regulations 2015 and the Accounts and Audit (Coronavirus) (Amendment) Regulations 2020.  The covering report informs the Committee of the key issues within the accounts.  The Chairperson to sign following the meeting.

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Dawn Garton, Director for Corporate Services introduced the report, the purpose of which was to seek approval for the Statement of Accounts for 2019/20, which had been prepared in accordance with the Accounts and Audit

Regulations 2015 and the Accounts and Audit (Coronavirus) (Amendment) Regulations 2020.

Mrs. Garton advised that since 2017/18, the Council had been required to produce signed accounts by the end of May and audited final accounts by the end of July.  This was an earlier deadline than previously required and was not without challenges, resulting in revised deadlines for the 2019/20 signed accounts (by the end of August) and the audited final accounts (by the end of November).  These challenges were exacerbated by the  Covid-19 pandemic and while the Council published its signed accounts by the end of June it did not achieve the November deadline due to delays in the external audit timescale.  Members had received progress updates and training on the draft Statement of Accounts in November and the Council awaited the result of the Government’s review of the external audit of local authority accounts.

Mrs. Garton highlighted that the audit of the accounts had not fully completed in relation to a small number of valuation queries and this would result in amendments to the accounts.  This affected the balance sheet but not the Council’s revenue position.  The Council’s actual borrowing was within the level of the Capital Financing Requirement (CFR) and there was a reduced excess of creditors over debtors, which showed slightly reduced performance to that of the previous year.  However, the figures were a ‘snapshot’ as at 31 March.  The Council continued to maximised its investments, showing an excess over the resources available.

During discussion the following points were noted:

·         Members commented that the report was well drafted and presented.  The information included, particularly on the previous year's accounts (2018/19), as a means of comparison was extremely useful.

·         It was unlikely that the Council would receive a rebate on External Audit’s 2019/20 fee, for the delay in publication of the audited final accounts, as the Covid-19 pandemic had resulted in additional work being undertaken by auditors which would result in an increased fee.

·         It was anticipated that there would be a general and significant increase to External Audit fees for 2020/21 and later years.

·         The variances between 2018/19 and 2019/20 Gains and Losses on Trading Accounts, as detailed at note 6 (Financing and Investment Income and Expenditure) of the Statement of Accounts were due to a revaluation gain on buildings in 2018/19, which caused a much reduced expenditure.  This mainly related to industrial estates and a little to the Cattle Market.

·         Investments held at the end of March (£20,5m) as detailed on page 103 of the Statement of Accounts represented property investment at its full value, those investments which had increased marginally during the year (£20,395m) detailed on page 189 represented cash and cash equivalents (£1,5m short-term deposits with banks/building societies and £3m money market funds), £14m short-term investments and £1,895m long-term investments (balance sheet valuation, as opposed to the actual £2m investment).

·         Members were concerned over the uncertainty in the asset valuations, as a result of the pandemic.

·         Assets had been evaluated (as at 31 March 2020) but the impact of Covid-19 was yet to be considered and it was too early to discern any meaningful amended values.

·         Members would be advised of the amendments made and the amended accounts would be published to the website, as required.

·         Members were urged give prior notice to officers of questions requiring detailed responses, to ensure that responses could be provided during meetings.

Councillor Jeanne Douglas, Chair of the Committee thanked the Finance Team for their work, noting that it had been undertaken during a period of extreme pressure and extraordinary circumstance.

Councillors Chandler, Child and Hewson abstained from the vote.

Audit and Standards Committee:

1)    APPROVED the Statement of Accounts for 2019-20;

2)    DELEGATED authority to the Director for Corporate Services to make any changes to the Statement of Accounts 2019-20, following this meeting in regard to the outstanding items reported verbally to this committee, to be signed by the Chair of Audit and Standards once complete.