Agenda item

2.55 pm

Report by Director of Finance

The Committee is asked to consider a report setting out the approach taken to the preparation of the 2021/22 Statement of Accounts including:

1.     The proposed timetable for the 2021/22 Statement of Accounts and External Audit;

2.     Future changes to the Code of Practice on Local Authority Accounting in England and Wales (“the Code”); and

3.     The approved Significant Accounting Policies which describe how the Council has interpreted and applied the Chartered Institute of Public Finance and Accountancy (CIPFA) 2021/22 Code of Practice on Local Authority Accounting in the United Kingdom which is the basis for the preparation of the accounts.

The Committee is RECOMMENDED to –

1.     Note the proposed timetable for the 2021/22 Statement of Accounts and the highlighted future changes; and

2.     Ratify the accounting policies as approved by the Chief Finance Officer annexed to the report.

The Audit & Governance Committee considered a report by the Director of Finance setting out the approach taken to the preparation of the 2021/22 Statement of Accounts including:

1.     The proposed timetable for the 2021/22 Statement of Accounts and External Audit;

2.     Future changes to the Code of Practice on Local Authority Accounting in England and Wales (“the Code”); and

3.     The approved Significant Accounting Policies which described how the Council had interpreted and applied the Chartered Institute of Public Finance and Accountancy (CIPFA) 2021/22 Code of Practice on Local Authority Accounting in the United Kingdom which was the basis for the preparation of the accounts.

The Committee was RECOMMENDED to –

1.     Note the proposed timetable for the 2021/22 Statement of Accounts and the highlighted future changes; and

2.     Ratify the accounting policies as approved by the Chief Finance Officer annexed to the report.

Richard Quayle, Chief Accountant, presented the report

Lorna Baxter, Director of Finance, and Maria Grindley and Adrian Balmer of Ernst & Young (EY) gave a brief presentation in relation to the valuation of highways infrastructure assets, which had become a national issue, and its implications for the completion of the 2020/21 annual accounts. In addition, Ms Grindley and Mr Balmer updated the Committee on work that had been undertaken in completing the 2021/22 annual accounts. Ms Baxter apprised the Committee concerning costs relating to audit fees.

In the subsequent discussion, the following points were raised.

(a)  In response to several questions on the “Notes to the Core Financial Statements” (Page 87 et seq.), officers provided the following information -

(i)    Regarding the role of district councils as agents of the County Council in collecting Council Tax and Business Rates (Page 88 under the heading “Council tax and business rates income”), bankruptcy of a local authority was not a consideration as central government would, in such circumstances, provide financial support to local authorities by way of “Capitalisation Directions”.

(ii)   Concerning the statement that “Land is determined to have an infinite life and is not depreciated” (Pages 90 & 91 under the heading “Depreciation of Property, Plant and Equipment), it was true that the value of land did not depreciate but was subject to valuation as part of the three-year valuation process carried out by officers.

(iii) Soft loans (Page 94 – under the heading “Financial Assets”) included loans to foster carers to make necessary adaptations to their homes to accommodate a foster child, the cost of which was less than paying for a child to be fostered by way of an external foster placement. In such an instance, interest would not be charged at the market rate.

(iv) Regarding self-insurance (Page 96 under the heading “Insurance”), the Council had a range of insurance packages, including insurance policies with insurance brokers.

(b)  Regarding the section on Plant, Property and Equipment (PPE) in the “Notes to the Core Financial Statements”, it was necessary to change the “Date of Next Revaluation” for Year 3 in the table on Page 90 to 2023/24.

As there were no more questions, the Chair drew the discussion to a close.

RESOLVED: To –

a)    Note the proposed timetable for the 2021/22 Statement of Accounts and the highlighted future changes; and

Ratify the accounting policies as approved by the Chief Finance Officer and included as an annex to the report.