Chair of the Governance Committee to report the recommendations of the Governance Committee held on 20 October 2021.
Council considered the Report by the Chief Financial Officer (circulated previously).
The Director of Resources and Deputy Chief Executive advised that:
· 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 now October meeting had been due to the Governance Committee not meeting on the 27th September 2021 as planned.
· It was noted that only 9% of Authorities had achieved this by 30th September due to additional pressures on the external audit firms and delays with the the Pension Audit.
· An Unqualified opinion had been issued.
· A recommendation concerning transparency of reporting to Members with regards to ongoing projects had been included in the action plan and agreed with management.
· 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.
· An increased workload on staff was noted and appreciation of the Officers for their efforts and hard work was also noted. The staff were considered a major contributor as to how the Authority remained financially viable.
· £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 Medium Term Financial Strategy (MTFS) as approved in February 2021 had predicted a funding gap of £2m.
· The Government’s Spending Review was due shortly.
· 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.
Councillor Roome reported the recommendations of the Governance Committee held on 20th October 2021 and advised that the efforts and hard work of the Officers had been the reason for the achievement of a surplus and the level of reserves held. He noted that the recommended level of reserves held were between five and ten percent. North Devon Council had achieved a level of 9.1%.
It was moved by Councillor Roome and seconded by Councillor Walker “that the Statement of Accounts for 2020-21 be approved”.
RESOLVED that the Statement of Accounts 2020-21 be approved.