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Agenda item

2024/2025 Draft Statement of Accounts

Purpose

To discuss the Statement of Accounts.

 

Please note that this item does not contain a cover report, this report will be introduced with slides at the meeting.

 

A link to the final set of published draft accounts will be provided at the meeting.

 

 

Minutes:

The purpose of the report was for the Audit and Governance Committee to review and discuss the Statement of Accounts.

 

The Chair opened the discussion on the 2024/2025 Draft Statement of Accounts, to give members the opportunity to review the complete document and advised Members that the draft statement would be introduced through a slide presentation. Members were informed that they would receive a link to the full draft accounts for their detailed review.

 

The Deputy Chief Executive and S151 Officer presented an overview of the draft accounts, noting that the document remained under final review and was expected to be available on the Council’s website soon and highlighted the necessity for internal reviews prior to publication, ensuring the content is examined to facilitate satisfactory external audits.

The Chief Accountant & Deputy Section 151 Officer presented the report and slides at the meeting that provided an in-depth look into the financial documents. The first discussion was had on the Comprehensive Income and Expenditure statement as a vital component of the accounts, showing how it captured the Council's income and expenses over the fiscal year. The following points were made:

  • There was focus on the surplus figure of £3.1 million. This figure represented the net outcome after all income sources and expenditures were accounted for.
  • The discussion emphasised a transfer of £2.1 million into earmarked reserves, which were funds set aside for specific future projects or needs, reflecting prudent financial management practices.
  • The Chief Accountant & Deputy Section 151 Officer explained that adjustments were necessary to comply with local government accounting standards, touching on technical entries such as depreciation and pension adjustments. These entries had a significant impact on the final reported surplus of £778,000. 

The discussion then moved onto the Movements in Reserve Statement and the Chief Accountant & Deputy Section 151 Officer elaborated on this statement, which outlined changes in various reserves held by the Council. The following points were made:

  • It was noted usable reserves, which were accessible for appropriations towards budgeted expenses, included a General Fund Reserve of £1.7 million designated as a "rainy day" fund to address unforeseen financial emergencies. 
  • The increase of £2.9 million in earmarked reserves was discussed, with clarification provided on the significance of setting aside the funds for future expenditures, such as grants or planned capital projects.

 

Discussions then moved to the Balance Sheet Summary and the Chief Accountant & Deputy Section 151 Officer highlighted significant movements in the balance sheet, noting an increase in property, plant, and equipment valued at approximately £1.7 million, mainly due to capital additions from ongoing projects, including improvements at Trinity Road and the Leisure Centre.

The following points were made:

  • Investment property values fell by about £670,000 due to changes in rental agreements and market conditions that affected the expected income from these properties.
  • The subject of pension liabilities was emphasised, with an increase of £1 million attributed to findings from the actuarial report by Hyman Robertson. This adjustment reflected the complexity of pension accounting where commitments to future payments can create significant liabilities, resulting in the reported figure of £13 million.
  • Overall, the Chief Accountant & Deputy Section 151 Officer’s insights provided a clear understanding of how reserves functioned and their importance for the ongoing financial stability of the Council.

 

Members were encouraged to thoroughly examine the published draft accounts to prepare for the upcoming training session to help promote an understanding of the financial statements.

RESOLVED: The Audit and Governance Committee noted the Statement of Accounts.

 

Supporting documents:

 

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