Meeting documents

To consider the attached report.

Contact Officer:  Simon Wasteney (01296) 585164

The Accounts and Audit Regulations state that Members should only approve the accounts when they have been made aware of the findings of the audit and hence were able to make a better informed decision.

Following on from the report on the draft accounts to the July meeting, Members received a report updating them on the audit process and the changes made to the accounts in accordance with the external auditor’s recommendations. The auditors’ comments and findings from their work on the 2016/17 accounts had already been reported to Members earlier in the meeting.

Subject to being satisfied with the revised accounts and that the auditor’s comments had been correctly responded to, the Committee was required to authorise the Chairman to sign them on the Audit Committee’s behalf, together with the Director with responsibility for Finance, in order to comply with the 30 September statutory deadline. However, it was requested that the Committee delegate to the Head of Finance, in consultation with the Chairman or Vice Chairman, the ability to make such changes to the accounts that are considered necessary in order to achieve the statutory deadline.

A number of adjustments had been made to the core statements presented in the draft accounts and these had been amended in the Statement of Accounts submitted to the meeting.  These adjustments were reported as follows:-

·                    Housing Benefit and associated grant – the closing position on the level of short term debtors in the draft accounts had been overstated, requiring correction to properly reflect the true position.

·                    LEAP funding – the level of balances carried forward into 2016/17 had been overstated, requiring correction to accurately reflect the true position.

·                    Council Assets – the value of a number of assets had been reported incorrectly, requiring subsequent revaluation and restatement in the final accounts.

·                    Expenditure and Funding Analysis Statement – this had been moved from the Core Financial Statements to the notes section (page 23), based on the auditor’s recommendation.

·                    Narrative Statement (page 3) – casting errors in the General Fund Revenue 2016/17 Budget in the draft 2016/17 accounts had been corrected.

·                    Comprehensive Income and Expenditure statement (page 7) – cross-referencing of note numbers had been adjusted to correctly align with the final document.

·                    Note 1.14 (page 17) – had been amended to remove reference to SeRCOP.

·                    Note 1.16.2 (page 18) – had been redrafted to add a bullet-point confirming the valuation method for Heritage Assets.

·                    Notes in 1.16.2 and 13.1 (pages 18 and 32) – had been redrafted to confirm consistency of the asset measurement basis applied.

·                    Note 2 (page 20) – had been redrafted to remove reference to changes in accounting standards that had already been disclosed in the 2015/16 accounts.

·                    Notes 11 and 12 (page 32) – cross-referencing of note numbers had been adjusted to correctly align with the 2016/17 final accounts.

·                    Note 32 (page 48) – grant figures had been misstated, requiring correction in the 2016/17 final accounts document.

·                    Note 35.2 (page 50) – the number of officers reported in each pay banding for 2016/17 has been adjusted to reflect the correct position.

·                    Note 38 (page 53) – the second table had removed reference to ‘increase’ in the total rows, as both years reflected a decrease.

·                    Note 39.7 (page 57) – the difference between the expected and actual return on assets had been adjusted to 14.24% for 2016/17 to reflect the accurate position.

·                    Note C3 (page 64) – in the final paragraph, the value of total non-domestic rateable value at 31/03/2017 had been marginally understated in the draft accounts.  This had been corrected, with additional alignment of dates in the final note.

Members were also informed that there had been two changes to the accounts to correct typographical errors:-

·                    Note 40.1 (page 59) – the amount on the top line had been corrected from £4,824,000 to £4,841,000.

·                    Note C4 to the supplementary financial statements (page 65) – the first dot point at the top of the page had been corrected to ‘Aylesbury Vale District Council and Group Movement in Reserves Statement’.

There was a requirement to report significant events that had occurred after the balance sheet date and before the sign off date.  However, since the committee in July, there had been no significant events that required reporting in the accounts.

The Committee was also informed that Inconsistencies had been identified in the valuation and presentation of AVDC’s car parks as part of the Property, Plant and Equipment (PPE) asset register review of the draft 2016/17 accounts.  In consultation with AVDC, the external auditor had agreed that this did not need to be adjusted in the 2016/17 accounts as it does not represent a material issue.  However, it was agreed that the 2017/18 accounts would be adjusted for this issue, based on consistent valuation of land and buildings of the Council’s car parks.

Members sought additional information and were informed:-

(i)            that the Council’s management had decided not to adjust one audit difference (misstatement) identified by the external auditors which related to the overstatement of car park assets post revaluation.  It had been agreed with the external auditors that the impact of doing this was not material.  As such, an adjustment would not be made to the accounts in 2016/17.

(ii)           Note 40.1 (page 59) – an explanation was provided on the monies owed to the Council and group and that it covered a full range of issues.  It was acknowledged that this amount had increased slightly since last year.  Some of this debt related to housing benefit overpayments which were always difficult to recover.  Members were informed that the Council had a current project looking at how this position could be improved.

(iii)          that information on debt provision for short term debtors was included at Note 20 to the core financial statements (page 42).

(iv)         Top 5 Under Budget / Top 5 Over Budget (page 3) – a discussion was held on the causal links between Housing Benefits underspend and Housing Benefits Administration being overspent.  The overspend related to high employee costs following redundancies, agency staff and salesforce costs.  Now that the Council’s staff structure were settling it was not anticipated that these same costs would be incurred next year.

(v)          Portfolio spending forecasts (page 4) – it was explained that the main reason for forecasting inaccuracies for the last year was due to no provision having been made for redundancy costs.  An assurance was given to Members that portfolio spending forecasts would improve for the next year.

(vi)         Note 6 – Brief note explaining significance of any pension liability or asset (page 4) – an explanation on the two measures of the Council’s pension liabilities had been discussed earlier in the meeting, including that the two valuations were carried out on different bases and were likely to differ.

Having considered the final Statement of Accounts for 2016/17, it was –

RESOLVED –

(1)          That the final outturn position of the Council’s Statement of Accounts 2016/17 be noted.

(2)       That approval be given to the Chairman of the Audit Committee to sign off the Statement of Accounts for 2016/17 on the Committee’s behalf.

(3)       That approval be given to the Director with responsibility for Finance, in consultation with the Chairman or Vice Chairman, to make such changes as considered necessary to achieve sign off by the statutory 30 September deadline.