Agenda item

Report by the Director of Finance.

This report sets out the approach taken to the preparation of the 2022/23 Statement of Accounts including:

(a)            The proposed date for publication of draft 2022/23 Statement of Accounts, and

(b)            The approved Significant Accounting Policies which describe how the Council has interpreted and applied the CIPFA 2022/23 Code of Practice in Local Authority Accounting in the UK (the Code) and the basis of preparation of the accounts.

The Audit & Governance Committee is RECOMMENDED to a) Endorse the proposed timetable to produce the draft Statement of Accounts for 2022/23 and b) Ratify the accounting policies as approved by the Director of Finance and included as an annex to this report.

The report was presented by Lorna Baxter, Director of Finance.  She stated that there were two parts to the report.  One set out the approved Significant Accounting Policies which describe how the Council has interpreted and applied the CIPFA 2022/23 Code of Practice in Local Authority Accounting in the UK (the Code) and the basis of preparation of the accounts.  These were adopted in keeping with the Statement of Accounts being produced.  Ms Baxter stated that the accounting policies were in Annex 1 and the only change to these from the previous year was the section on Infrastructure Assets in paragraphs 45 to 51.  As reported at previous meetings of the Committee, Infrastructure Assets had been a major issue in delays to the 2020/21 accounts.

It was explained that in respect of the other part of the report, the proposed timetable to produce the draft Statement of Accounts for 2022/23, CIPFA had requested that they were published by the end of May 2023.  There were a number of challenges to the Council’s Finance Team in relation to that.  These included that the small Finance team, many of whom were new members, were working on three different years of audits simultaneously, including responding to queries for the 2020/21 audit, producing information for 2021/22 and seeking to put together the accounts for 2022/23.  Also, with two years of open audits, it was not possible to know if there were any audit issues and any impact on prior year comparators for 2022/23 accounts.  The Finance Team had also been responding to queries on 2020/21 and sample requests and evidence for 2021/22 which had delayed work beginning on the 2022/23 Statement of Accounts.

Ernst & Young (E&Y), the Council’s external auditors, had informed the Council that they would not be commencing the 2022/23 audit before the beginning of 2024.  In order that Finance had the opportunity to respond to audit queries and meet the priority of ensuring the previous years’ audits were signed off, it was proposed to produce the draft Statement of Accounts for 2022/23 by the end of June.  It was emphasised that the end of May date for the draft Statement of Accounts was not a statutory deadline. 

Ms Baxter and the Chair referred to the fact that there were a large number of Councils in the same position as Oxfordshire with a backlog of audits outstanding.  In addition to the Infrastructure Assets issue, due to the 2020/21 accounts still being open, there was a potential impact arising from the triennial pension valuation which took place in December 2022. 

It was agreed that advice would be taken on whether it would be helpful to make a public statement for the national reasons behind delays to sign off of the accounts.

RESOLVED that:

1)    the proposed timetable to produce the draft Statement of Accounts for 2022/23 be endorsed by the Committee; and,

2)    the accounting policies as approved by the Director of Finance and included as an annex to the report be ratified by the Committee.

ACTIONS: 

1)    Advice to be taken on whether it would be helpful to make a public statement for the reasons behind delays to the sign off of the accounts.

2)    Lorna Baxter agreed to review the wording of Paragraph 53 of the accounting policies in Annex 1.