Agenda item

To receive a report of the Director of Resources detailing and requesting approval of the Council’s final audited Statement of Accounts for 2010/11.

The Chief Officer (Financial Management)  presented a report for the Director of Resources. The report presented both KPMG’s report to those charged with governance for 2010/11 (ISA 260 report) and the final audited Statement of Accounts for approval. The report also included an audit opinion on whether the Council has proper arrangements for securing value for money by making proper arrangements to secure economy, efficiency and effectiveness in its use of resource.

KPMG confirmed they have reviewed the Annual Governance Statement and confirmed it complies with Delivering Good Governance in Local Government: A Framework published by CIPFA/SOLACE  in June 2007; and it is not misleading or inconsistent with other information we are aware of from our audit of the financial statements.

In attendance were Mike McDonough, Steve Clark and Alison Ormston from KPMG.

Members discussed the report in detail and asked questions in relation to figures contained within the accounts, how these had been arrived at and also compared them to the previous years accounts. Specifically Members queried the following with the officers in attendance and KPMG representatives:

• the large change in the balance of the HRA account compared to last year’s figure;
• the treatment of PFI schemes in the accounts;
• the valuation of assets in the fixed asset register and how these are calculated;
• the inclusion of assets sold or transferred in the accounts; and
• whether KPMG were satisfied with the contingent liabilities stated in the accounts

Members also asked officers about the International Financial Reporting Standards, how much of these the Council was required to implement in preparing the accounts and what accounting framework the authority was using.

Members challenged KPMG with regards to the fee that they charged and asked for a detailed summary of how the fee was arrived at.

As a gesture of good will KPMG offered to reduce the fee by £5,500.

In approving the accounts, Members attention was drawn to KPMG’s conclusions including; the unqualified audit opinion, that the Annual Governance Statement accords with KPMG’s understanding, that all prior year recommendations have been dealt with, that a number of new recommendations have been agreed with the Council and that KPMG were complimentary about the standard and timeliness of working papers.

RESOLVED – The Committee resolved to:

(a)  note the amendment to the financial statements in relation to the figure used for the teachers holiday accrual;

(b)  approve the final audited 2010/11 Statement of Accounts and agreed that the Chair acknowledge the approval on behalf of the Committee by signing the appropriate section within the Statement of Responsibilities on page 1 of the accounts;

(c)  agree that the Chair should also sign the management representation letter on behalf of the Committee;

(d)  note the work to date on the VFM audit opinion and that KPMG have now concluded their VFM opinion that the Council has made proper arrangements to secure economy, efficiency and effectiveness in its use of resource;

(e)  note the rebate KPMG have given in respect of the audit fee; and

(f)  request a report detailing future developments in accounting standards that will effect the Council.