Agenda item

2019/20 Statement of Accounts

Minutes:

Consideration was given to a report of the Director of Finance which presented the Council’s Statement of Accounts for the financial year 2019/20.  The Audit Committee was charged with the scrutiny and approval of the Statement of Accounts.

 

The report highlighted:

·         The overall revenue outturn position for 2019/20 was a surplus of £0.270m.  This was an increase on the favourable variance of £0.065m projected at Month 9 that was reported to Cabinet on 23 March 2020.

·         The year-end variances that were attributable to each Portfolio.

·         Schools balances at 31 March 2020 were £5.487m but were offset by the deficit on the Dedicated Schools Grant (DSG) of £4.916m leaving a net balance of £0.571m held within Other Earmarked Reserves.

·         The final Housing Revenue Account (HRA) balance was £21.796m.

·         The balance on the Collection Fund was a surplus of £3.295m.

·         The small reduction in revenue account earmarked reserves of £1.263m to a level of £79.360m, a decrease in other earmarked reserves of £4.431m to a level of £8.504m and an increase in the General Fund balance of £0.270m to £15.110m, reflective of the revenue outturn position.

·         Expenditure on the Council’s Capital Programme for 2019/20 was £54.383m which was an increase on the Month 9 forecast expenditure of £52.497m.  The increase in expenditure required funding allocated to future years to be re-profiled to fully finance the Capital Programme in 2019/20.

·         Capital Receipts in year totalled £9.914m, all of which were used to finance the Capital Programme in year.

·         The significant items in each of the primary financial statements.

·         The preparation of Group Accounts incorporating the Councils two wholly owned companies – the Unity Partnership Ltd. And MioCare Community Interest Company.

·         The performance of the Finance Team in closing the accounts.

 

The presentation of the audited Statement of Accounts provided the Audit Committee members with the opportunity to review the Council’s Statement of Accounts and any amendments made to date as a result of the audit process and following the conclusion of the period for public inspection.  The public inspection period had closed on 10 July 2020 with no objections received by the Council or the External Auditors.  The Accounts were presented at Appendix 1 to the report.

 

The Committee were advised that at the time of the Committee papers being issued, the audit, although substantially complete, required the resolution of an outstanding item related to the Council’s investment in the Manchester Airport Holdings Limited.  The External Auditors also had to have assurance with regard to the audit of the Greater Manchester Pension Fund (GMPF).  The GMPF assurance work had not yet been concluded.

 

The Committee were advised that the Final Accounts had been prepared under challenging circumstances.  The main outstanding issues were not under the control of the Council and would be resolved as soon as possible. 

 

The changes to the Final Accounts was referenced at Appendix 2 to the report, which included the Pension Fund measurement, pension reserve statement linked to two subsidiaries and some transactions which had been incorrectly identified.  A lease note had been added for this first time which aided improved transparency.  Changes also included amendments to classifications on disclosure of financial interests, updated Clinical Commissioning Group outturn information and minor alterations to the narrative to the accounts.

 

It was noted that given the challenging position of the Council and local government that the Committee be provided with appropriate information and how the Council was dealing with the challenges.  Use of reserves would be minimised and reports would be brought to the committee which outlined relevant matters.

 

Members asked about the £17m reduction in pension liability and were informed that the first report had contained draft estimates with valuation assumptions from January.  A further revised based on the position at the end of March found that the actual figure was better than forecast and, even though there was only a slight percentage change in assumptions, given the size of the pension liability, the change had resulted in a revision to the valuation which required an adjustment to the accounts.

 

Members asked about the challenges in the preparation of the accounts and were informed that the collation of information had been harder with information held on laptops as well as paper documents held in offices.  It has been more challenging to only work on laptops without the ability to print reports and working papers for checking.

 

Members sought a change to the recommendation in the report to include the accounts be approved subject to any major amendments or changes being brought to the attention of the Committee.  Members moved and seconded the following amended recommendation which was agreed:

 

“The Audit Committee delegate the approval of the final accounts to the Vice Chair of the Audit Committee in conjunction with the Director of Finance aligned to the advice of the External Auditor and subject to a report to the September meeting of the Audit Committee detailing the updated audit position.”

 

RESOLVED that:

1.         The Council’s Statement of Accounts for 2019/20 be noted.

2.         The Management Letter of Representation be noted.

3.         The approval of the Council’s Statement of Accounts be delegated to the Vice Chair of the Audit Committee in conjunction with the Director of Finance aligned to the advice of the External Auditor subject to a report to the September meeting of the Audit Committee detailing the updated audit position.

Supporting documents: