Agenda item

Note 1: Councillor N Thomas left the meeting room for items 5 and 6 having declared an interest.

The Committee considered a report which contained the draft Annual Report and the Financial Statements for the year ended 31 March 2022. These had been prepared in accordance with the requirements of the Charities Act 2011 and had adopted the provisions of Accounting and Reporting by charities Statement of Recommended Practice and Financial Reporting Standards. The accounts had been audited by Azets Audit Services. Ms Sophie Payne, Service Director for Culture, Sport and Leisure and Ms Fiorella Mugari, Head of Finance for Communities attended to present the update.

The Council as sole trustee had introduced enhanced governance arrangements which included oversight on Trust activities by the Leisure Board and reports to the Corporate Management Team board meetings.

The net worth of Farnham Park Sports Field Charity had increased by £3k to £480k in 2022. The net operating surplus for the year was £3k compared to a net operating loss of £202k in 2020/21. The main reason for the movement was the introduction of management fee income of £231k payable by Buckinghamshire Council to manage and operate the land known as South Buckinghamshire Golf Course along with Farnham Park Playing Fields.

Key points raised during discussion included:

·    The Chairman noted that during the previous municipal year, the Committee had raised concern around the Section 151 Officer signing the accounts for the Farnham Park Sports Field Charity and Higginson Park Trust respectively, in both their capacity on behalf of the Trustee and as the Council’s Section 151 Officer as it was felt that this placed the Section 151 Officer in an invidious position. Whilst there was no legal conflict, the Committee requested that this not happen again, however with the change to the Council’s Section 151 Officer the same situation had happened with the 2021/22 accounts. The Committee requested that this situation was remedied for the 2022/23 accounts and beyond.

ACTION: The Section 151 Officer to ensure that the 2022/23 accounts, and subsequent years were signed by a separate officer on behalf of the Council as a Trustee.

·    The Chairman welcomed the improved financial positions of Farnham Park Sports Field Charity and the Higginson Park Trust Fund following on from the significant impact the Covid pandemic had on both Trusts.

·    The Committee was advised of the two sites in Farnham Park and Farnham Royal which consisted of the South Buckinghamshire Golf course and the playing fields. The mix of facilities at the playing fields included well used football pitches and the national headquarters of Baseball/ Softball UK whilst there was also a rugby club and martial arts club. The staffing team that ran the sites were Council employees whose salaries were recharged to the Trust.

·    Members were reminded that 2020/21 had been a difficult year across the leisure industry with closures or centres operating with significant restrictions. 2021/22 reflected an improved position in line with the Government road map of gradual reopening. The Trust had continued some of its previous measures to mitigate for income loss such as holding vacancies. The Council had also made provision for a sum to cover the running costs of the playing fields to recognise the importance they had on improving residents’ health and wellbeing and some investment in to the playing pitches had been made to increase future usage. Nearly 37,000 rounds of golf had been played during the financial year, 15,000 participants took part in Baseball/Softball UK and 9,000 had been involved in football at the site.

·    There was now a service level agreement in place between the Council and the Trust to formalise the arrangements and specifics of grounds maintenance. There continued to be some impact of Covid, particularly within bar and catering where recruitment had been challenging and customer confidence was still returning.

·    Inflation and energy costs were a key concern this year, figures were being calculated on the latest Government advice, and mitigations being made included holding a post vacant, increasing prices in line with inflation, Baseball/Softball UK investing to develop their facilities and partnerships with the likes of UK Padel being explored.

·    Clarity was provided on the two internal control areas which were amber within the audit. Members were advised that the fixed asset register was reviewed annually and that a decision to demolish or refurbish those buildings in a poor state would be linked in to the Leisure Strategy which was due to be completed in early 2023. It may be that within the Strategy, Farnham Park was identified as a potential site for investment. In relation to the lack of tracking on flexi points Members were informed that a report could now be run for any member to inform them of their points balance and this fed through to the monthly outturn. It was being explored with the service provider whether the points balance could be added to receipts each time a member played.

·    It was noted that on the Opening balances internal control, as part of the system changeover, balances had not matched with the accounts. The balances would be agreed as part of the process moving forward and as these accounts were signed off.

RESOLVED:

1.      That the audit progress and findings report from Azets (Appendix 2) be noted.

2.      That the Letter of Representation (Appendix 3) be approved.

3.      That the Annual Report and Financial Statement for 2021/22 be approved.