Meeting documents

To consider Item 12

The Director of Finance and Assets thanked Ernst & Young for helping the Authority to get to the excellent position of closing the statement of accounts early this year.

The Technical Accountant also thanked the Auditors and advised Members that the audit process had gone very smoothly this year and as previously mentioned, the statutory requirement was changing and the Authority would need to close its accounts and have them audited by 31 July for all financial years from 2017/18 onwards. 

The Technical Accountant brought to Members attention an additional note that had been added to Item 30 - Events after the Balance Sheet Date. This was events that had taken place after the statement of accounts had been produced. The key event that took place was the EU Referendum on 23 June 2016, in which the UK public voted to leave by 52% to 48%. Since the Referendum there had been a volatility in the stock markets, exchange rates and interest rates, and some of the movements could potentially impact materially on amounts disclosed in the financial statements. The areas that it could potentially impact on were the value of land and buildings, the fair value of long term borrowing, the liability related to defined pension schemes and possibly unusable reserves. However, due to the recentness of the event, and the complexity and uncertainty of negotiating an exit, no estimate could be made of the value of the financial impact at this stage.

A Member asked a question concerning the calculation of depreciation on land and buildings. Members were advised that the Authority had to revalue assets to reflect market conditions (i.e. movement in prices) but also depreciate assets to reflect usage (i.e. as the building got older it would need repairs and that had to be reflected). The land and buildings were valued separately. Land does not depreciate, but is periodically revalued (which could be up or down depending on market conditions).

A Member asked should the Authority be concerned regarding the deficit on the provision of services which for 2015/16 amounted to £12.036m and for 2014/15 was £8.810m. Members were advised that it was not something to be concerned about as there were a number of factors to consider, not just what had been spent on services. There were other adjustments that had to be made, there was a net decrease in reserves for the general fund throughout the year and a lot of that was adjustments made to the capital financing requirement, as detailed in the paper presented to the Executive Committee in November 2015.

A Member asked how much bonus over and above the salary was paid to the Chief Fire Officer in the previous year 2014/15. Members were advised that the ‘other payments’ included bonus and exit packages. The previous Chief Fire Officer had left the Authority within 2014/15 so some of that amount would be retirement benefits. The Director of Finance and Assets would forward a copy of a response to the same enquiry raised in relation to 2014/15 to both the Member raising the issue as well as the Chairman of the Committee.

RESOLVED –

That the Statement of Accounts for the financial year ended 31 March 2016 be signed by the Chairman of this Committee.