Agenda item

Draft Statement of Accounts 2019/20

Decision:

(a)       That the draft Statement of Accounts 2019/20 (which includes the Annual Governance Statement) be noted; and

 

(b)       That Members note the opportunity to discuss any aspect of the Statement of Accounts with officers or Audit Wales from July to September, prior to the final audited version being brought back to the Committee for final approval on 9 September 2020.

Minutes:

The Corporate Finance Manager presented the Draft Statement of Accounts 2019/20 (subject to audit) for information only at this stage.  These comprised the Group accounts, including its wholly owned subsidiaries, and the Annual Governance Statement to be considered later on the agenda.  The Committee would receive the final audited accounts for approval on 9 September, ready for publication by the statutory deadline of 15 September.

 

The Corporate Finance Manager and Interim Finance Manager (Technical Accountancy) gave a joint presentation covering the following:

 

·         Purpose and Background of the Accounts

·         Contents and Overview

·         Responsibility for the Accounts

·         Accounts Governance Group

·         Links to Budget Monitoring

·         Headlines - Council Fund, Revenue Reserves, Capital and Housing Revenue Account (HRA)

·         Changes to the Accounts for 2019/20

·         Group Accounts

·         Impact of COVID-19

·         Timeline and Next Steps

·         Impact of Earlier Deadlines

·         Clwyd Pension Fund Accounts

 

Allan Rainford asked about public inspection of the accounts and was advised that if such requests could not be accommodated electronically then an appointment would be made at one of the Council’s buildings, in accordance with physical distancing guidelines.  When asked about the challenges in producing the accounts during the emergency period, the Corporate Finance Manager said that agile working was part of normal business practice and that teams had adapted to an extension of this arrangement.  On the accuracy of figures, he gave assurance that there had been no change to estimating techniques and that the robust quality assurance process had been strengthened by other teams providing verification of figures.

 

Matt Edwards of Audit Wales gave assurance that there had been regular engagement with the Finance team throughout the process to deal with emerging issues in order to mitigate the risks and challenges arising from the emergency situation.

 

In response to questions from Sally Ellis on short-term debtors, officers explained that the figures reflected the position at that stage in the process.  The increase in the category marked ‘Other’ comprised an additional amount for Parc Adfer along with a number of individual debtors with low balances outstanding at that particular time.  On the NHS debt, the Chief Executive reported positive progress with the matter due to be reviewed again during the Autumn to enable the national pandemic to take priority.  The Corporate Finance Manager said that whilst that the figure in the accounts was the position at that time, an update would be provided in a written response to the Committee.

 

To prepare for the challenges around the 2020/21 accounts, Sally Ellis asked that the Committee be kept informed of any emerging issues to help carry out its role.  The Corporate Finance Manager advised that preparations were underway and that achieving the early timeline for this year’s accounts amidst challenging circumstances reflected positively on the process for next year.

 

In response to questions from Allan Rainford, the Corporate Finance Manager referred to the Council’s robust and transparent protocol for setting reserve levels, which had been maintained at a base level of £5.8m (around 2% of the budget) for some years and reviewed annually.  In addition to this amount, Contingency Reserves were used to create capacity to address unforeseen significant risks in-year.  The allocation of £3m of Contingency Reserves to mitigate the financial impacts from the pandemic had helped to protect the base level of reserves.  Criteria for capital grants had been tracked as a key corporate risk, however the flexibility introduced by Welsh Government (WG) meant that the Council was able to submit a claim to account for expenditure for the period from April to June.

 

The Interim Finance Manager agreed to provide a separate response to the Committee on the amount of £374k on note 28 for related parties (officers).  He would also share information on Sally Ellis’ question regarding the fluctuation in management and supervision costs on the HRA - Income and Expenditure and Movement on Reserve Statements.

 

Councillor Johnson asked about the Committee’s role in respect of the issues arising from the emergency situation.  The Chief Executive said that accounting retrospectively for the additional spend would need to form part of the narrative and separated from the accounts as extraordinary spend of scale.  The presentations later on the agenda gave an oversight of actions taken to respond to the pandemic.

 

The Chief Executive’s suggestion for a quarterly report on how the Council was proportionately responding and its approach to making risk-assessed decisions was welcomed by Councillor Axworthy.

 

In thanking officers for the presentation and report, Councillor Banks referred to the opportunity for Members to discuss any aspect of the accounts with Audit Wales.  To facilitate this, contact details would be shared.

 

The recommendations in the report were moved and seconded by Councillors Dunbobbin and Johnson.

 

RESOLVED:

 

(a)       That the draft Statement of Accounts 2019/20 (which includes the Annual Governance Statement) be noted; and

 

(b)       That Members note the opportunity to discuss any aspect of the Statement of Accounts with officers or Audit Wales from July to September, prior to the final audited version being brought back to the Committee for final approval on 9 September 2020.

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