Decision status: Recommendations Approved
Is Key decision?: No
Is subject to call in?: No
The Committee considered a report by the Director of Resources and Deputy Chief Executive regarding the Statement of Accounts 2020/21 (circulated previously).
The Director of Resources and Deputy Chief Executive highlighted the following points for the Committee:
· The draft accounts would usually be signed off by the 31st of July each year, however this had been extended to the 30th September. The delay to this October meeting had been due to the Governance Committee not meeting on the 27th September 2021 as planned
· An Unqualified opinion had been issued.
· A previous forecast at quarter 3 of a net surplus of £28k had now been increased due to additional funds such as income from planning, increased rental income on Butcher’s Row, reduced spend on temporary accommodation and accompanying reductions in costs across the Authority.
· £1.2m General fund reserve, and £16.3m earmarked reserves were achieved.
· The earmarked reserves were artificially higher in 2020/2021 due to timing differences in the accounting treatment of Covid business rate relief from Central Government.
· The Authority was in a strong financial position for 2021/2022 year.
· The net worth on the balance sheet had shown a net decrease on 2019/20 due to an increase in the valuation of the long term assets, including the value of the new leisure centre build and an increase in the net liability of the pension fund.
· The deficit in the Pension fund was offset by a pension reserve and would be made good by the employees’ contributions over their employment period. The value of this fund was reassessed every three years.
· The final opinion on the accounts was due from the Auditors next week (w/c 25th October 2021).
· There would be a slight change to the wording on the material uncertainty disclosure due to the valuation and replacement costs of assets. The increase in rebuild costs were due to the prices of building materials. A disclosure note had been added to the accounts in explanation
In response to questions from the Committee, the Director of Resources and Deputy Chief Executive advised that:
· Any cash balances held were protected as set out in the Treasury Management Strategy. Investments were held across a number of institutions to reduce risk.
· The build of the Leisure Centre was covered by a fixed cost construction contract - reducing financial risk to the Authority.
The Chair added that the general fund reserve balance for a District Council should be between 5% and 10%. NDC had achieved 9.1%. He commended the Chief Executive, Director of Resources and Deputy Chief Executive and the staff for their efforts in delivering the services within budget.
RECOMMENDED that the Statement of Accounts 2020/21 be approved and proceed to Council for consideration.
Report author: Jon Triggs
Publication date: 08/11/2021
Date of decision: 20/10/2021
Decided at meeting: 20/10/2021 - Governance Committee