Lancashire Combined Fire Authority

Audit Committee

Meeting to be held on Tuesday 30 June 2026

 

Financial Statements Update

(Appendix 1 refers)

 

Contact for further information: Steven Brown - Director of Corporate Services Telephone Number: 01772 866804

 

Executive Summary

This report updates the Audit Committee on progress in preparing the Authority’s 2025-26 unaudited Financial Statements. The latest draft core financial statements are included at Appendix 1 for information. These comprise the Comprehensive Income and Expenditure Statement, Movement in Reserves Statement, Balance Sheet and Cash Flow Statement.

 

The statements remain subject to final quality assurance and external audit. They are not presented for approval at this stage, and the figures may change before the audited accounts are presented to the Committee.

 

Recommendation(s)

The Committee is asked to:-

·         Note progress in preparing the Authority’s 2025-26 unaudited Financial Statements;

·         Note the Authority’s latest draft core financial statements at Appendix 1; and

·         The Committee is also asked to note that the figures remain subject to final quality assurance and external audit and may therefore change before the audited accounts are presented for approval.

 

 

Information

For the financial year 2025-26, the Authority must publish its draft accounts by the statutory deadline of 30 June 2026. The audited accounts are expected to be available by 30 November 2026, subject to completion of the external audit. This report provides the Committee with an update on the latest draft financial statements prepared for publication and audit.

 

There is no statutory requirement to present the unaudited accounts to the Committee before the external audit process commences. However, presenting the latest draft core financial statements provides members with early visibility of the Authority’s financial position and supports transparent financial governance.

 

The Accounts and Audit (England) Regulations 2015 apply to the preparation, approval and audit of the Statement of Accounts and other financial statements. These regulations are based on International Financial Reporting Standards (IFRS), which seek to present accounts in a consistent format across the public and private sectors with the aim of improving transparency. The Authority’s revenue outturn and statutory financial statements are prepared on different bases. The revenue outturn reflects financial performance against the Authority’s budget. The statutory financial statements then apply required accounting adjustments, including pension and asset valuation entries. These adjustments are necessary for compliance with accounting standards but do not all affect the Authority’s available revenue funding. The table below summarises the adjustments required to the revenue outturn to reach the Total Comprehensive Income and Expenditure reported in the latest draft financial statements.

 

Reconciliation

£000

Revenue Outturn

(335)

Remove transfers to / from reserves

637

Adjustments for Capital Purposes

(57)

Net change for Pensions Adjustments

2,589

Other Differences

(1)

Deficit on provision of services

2,834

(Surplus)/Deficit on revaluation of fixed assets

1,458

Actuarial (gains)/losses on pension fund assets

(14,448)

Total Comprehensive Income and Expenditure

(10,157)

Table 1 – Adjustments required to the revenue outturn

 

The latest draft Comprehensive Income and Expenditure Statement, Movement in Reserves Statement, Balance Sheet and Cash Flow Statement are set out in Appendix 1. Subject to final quality assurance processes, these will form part of the accounts submitted for external audit. The draft financial statements do not identify any immediate issue affecting the Authority’s ability to deliver operational services.

 

Financial Implications

There are no new financial commitments arising directly from this report. The report presents the Authority’s latest draft financial position for 2025-26. The draft statements remain subject to final quality assurance and external audit and may change before the audited accounts are presented for approval.

 

The report distinguishes between the Authority’s revenue outturn and the statutory accounting position. Some of the largest adjustments relate to pension accounting and asset valuation movements. These affect the presentation of the financial statements but do not directly change the Authority’s in-year revenue budget or operational spending power.

 

Legal Implications

The preparation, publication and audit of the Statement of Accounts are governed by the Accounts and Audit (England) Regulations 2015. The relevant statutory timetable is set out in the report. There are no additional legal implications arising directly from the recommendations.

 

Business Risk Implications

The main risks relate to completion of final quality assurance, incorporation of any outstanding figures, and any issues identified through external audit. These risks are being managed through internal review, compliance with the statutory timetable and engagement with the external auditor. Any material changes arising before completion of the audited accounts will be reported to the Committee.

 

Environmental Impact

None.

 

Equality and Diversity Implications

There are no direct equality and diversity implications arising from this report. The report is provided for information and does not propose changes to services, policies or staffing. The final published accounts should be made available in an accessible format in accordance with the Authority’s usual publication arrangements.

 

Human Resource Implications

None.

 

Local Government (Access to Information) Act 1985

List of background papers

Not Applicable

Appendix 1: Core Financial Statements

 

Comprehensive Income and Expenditure Statement

 

-

2025-26

2025-26

202526

2024-25

2024-25

2024-25

-

Notes

Gross

Expenditure

£000

Gross

Income

£000

Net

Expenditure

£000

Gross

Expenditure

£000

Gross

Income

£000

Net

Expenditure

£000

Continuing operations:

Service Delivery

-

27,485

(4,101)

23,383

25,881

(2,409)

23,473

Strategy and Planning

-

12,475

(348)

12,127

12,801

(642)

12,159

People and Development

-

2,201

-

2,201

2,231

-

2,231

Corporate Services

-

5,810

-

5,809

5,616

(6)

5,610

Fire-fighters Pensions

-

2,209

(33)

2,176

1,412

-

1,412

Overheads

-

11,800

(5,896)

5,904

10,875

(4,903)

5,971

Net Cost of Services

-

61,980

(10,379)

51,601

58,816

(7,960)

50,856

(Gain) or Loss on disposal of non-current assets

-

-

-

(74)

-

-

(116)

 

Financing and investment income and expenditure

Interest payable and similar charges

-

-

-

1,220

-

-

1,272

Pensions interest cost and expected return on pensions assets

-

-

-

30,599

-

-

29,127

Interest receivable and similar Income

-

-

-

(2,120)

-

-

(2,291)

 

Taxation and non-specific grant income

Council tax

-

-

-

(43,018)

-

-

(39,911)

Revenue Support Grant

-

-

-

(13,702)

-

-

(13,470)

Non-domestic rates redistribution

-

-

-

(17,125)

-

-

(16,740)

Business rates Section 31 grant

-

-

-

(4,484)

-

-

(5,673)

(Surplus) or Deficit on the provision of services

-

-

-

2,834

-

-

3,054

 

-

2025-26

2025-26

2025-26

2024-25

2024-25

2024-25

-

Notes

Gross

Expenditure

£000

Gross

Income

£000

Net

Expenditure

£000

Gross

Income

£000

Gross

Expenditure

£000

Net

Expenditure

£000

Surplus on revaluation of non-current assets

-

-

-

1,458

-

-

(3,645)

Actuarial (gains) and losses on pensions assets and liabilities

-

-

-

(14,448)

-

-

(67,199)

Other comprehensive income and expenditure

-

-

 

(12,990)

-

-

(70,845)

Total Comprehensive Income and Expenditure

-

-

-

(10,157)

-

-

(67,791)

Movement in Reserves Statement 2025-26

 

-

General fund*

£000

Earmarked reserves

£000

Total General Fund Balance

£000

Capital grant unapplied reserve

£000

Capital receipts reserve

£000

Total usable reserves

£000

Unusable reserves*

£000

Total Authority reserves

£000

Balance at 31 March 2025 carried forwards

6,564

29,012

35,576

-

194

35,770

(470,932)

(435,162)

 

Movement in reserves during 2025-26

Surplus or (Deficit) on provision of services

(2,834)

-

(2,834)

-

-

(2,834)

-

(2,834)

Other comprehensive income and expenditure

-

-

-

 

-

-

12,990

12,990

Total comprehensive income and expenditure

(2,834)

-

(2,834)

-

-

(2,834)

12,990

10,157

 

Adjustments between accounting basis and funding basis under regulations

Charges for depreciation and impairment of non-current assets

6,682

-

6,682

-

-

6,682

(6,682)

-

Amortisation of intangible assets

111

-

111

-

-

111

(111)

-

Disposal of assets

(74)

-

(74)

-

78

4

(4)

-

Provision for the repayment of debt

(670)

-

(670)

-

-

(670)

670

-

Capital expenditure charged against General Fund Balance

(6,105)

-

(6,105)

-

-

(6,152)

6,105

-

Amount by which the Code and the statutory pension costs differ

2,589

-

2,589

-

-

2,589

(2,589)

-

 

-

General fund

£000

Earmarked reserves

£000

Total General Fund Balance

£000

Capital grant unapplied reserve

£000

Capital receipts reserve

£000

Total usable reserves

£000

Unusable reserves

£000

Total Authority reserves

£000

Amount by which the Code and the statutory collection fund income differ

41

-

41

-

-

41

(41)

-

Accumulated absences

(43)

-

(43)

-

-

(43)

43

-

Adjustments total

2,531

-

2,531

-

78

2,609

(2,609)

-

Net increase or decrease before transfers to earmarked reserves

(302)

-

(302)

-

78

(225)

10,381

10,157

Transfers (to) or from earmarked reserves

662

(662)

-

 

 

-

-

-

Increase or (Decrease) in the year

359

(662)

(302)

-

78

(225)

10,381

10,157

Balance at 31 March 2026 carried forwards

6,923

28,350

35,273

-

272

35,545

(460,550)

(425,005)

 

Balance Sheet

 

-

Notes

At 31 March 2026

£000

At 31 March 2025

£000

Long-Term Assets

Property, Plant and Equipment

-

127,534

129,576

Intangible Assets

-

422

467

Long-Term Assets total

-

127,957

130,043

 

Current Assets

Inventories

-

326

318

Short-Term Investments

-

     39,115

49,540

Short-Term Debtors

-

11,113

7,925

Cash and Cash Equivalents

-

451

582

Current Assets total

-

51,005

58,365

 

Current Liabilities

Grants Received in Advance

-

(440)

(4,581)

Other Short-Term Liabilities

-

(769)

(672)

Short-Term Creditors

-

(11,294)

(14,732)

Current Liabilities total

-

(12,503)

(19,984)

 

Long-Term Liabilities

Provisions

-

(1,653)

(1,246)

Long-Term Borrowing

-

(2,000)

(2,000)

Other Long-Term Liabilities

-

(587,811)

(600,340)

Long-Term Liabilities total

-

(591,464)

(603,586)

 

Net Liabilities

-

(425,005)

(435,162)

 

-

Notes

At 31 March 2026

£000

At 31 March 2025

£000

Usable Reserves

General Fund

-

(6,923)

(6,564)

Earmarked Reserves

-

(28,350)

(29,012)

Capital Grants Unapplied Account

-

-

-

Usable Capital Receipts Reserve

-

(272)

(194)

Usable Reserves total

-

(35,545)

(35,770)

 

 

 

-

Notes

At 31 March 2026

£000

At 31 March 2025

£000

Unusable Reserves

Revaluation Reserve

-

(69,226)

(73,745)

Capital Adjustment Account

-

(46,898)

(43,858)

Pension Reserve

-

576,571

588,430

Collection Fund Adjustment Account

-

(550)

(591)

Accumulated Absences Adjustment Account

-

653

696

Unusable Reserves total

-

460,550

470,932

 

Total Reserves

-

425,005

435,162

 

 

Cash Flow Statement

 

-

Notes

2025-26

£000

2025-26

£000

2024-25

£000

2024-25

£000

Net deficit on the provision of services

-

(2,834)

-

(3,054)

-

Adjustments to net deficit on the provision of services for non-cash movements

-

(834)

-

30,251

-

Adjustments for items included in the net (deficit) on the provision of services that are investing and financing activities

-

(105)

-

(681)

-

Net cash flows from Operating Activities

-

-

(3,773)

-

26,516

 

Investing activities

Purchase of property plant and equipment and other capital spend

-

(6,213)

-

(4,261)

-

(Increase) or Decrease in short-term deposits

-

10,425

-

(26,040)

-

Receipts from investing activities

-

1,302

-

1,931

-

Net cash flows from investing activities

-

-

5,514

-

(28,370)

 

Financing activities

Cash payments for the reduction of the outstanding liabilities relating to finance leases and on-balance sheet Private Finance Initiative (PFI) contracts

-

(675)

-

(611)

-

Payments for financing activities

-

(1,197)

-

(1,249)

-

Net cash flows from financing activities

-

-

(1,872)

-

(1,861)

Net increase or (decrease) in cash and cash equivalents

-

-

(131)

-

(3,715)

Cash and cash equivalents at the beginning of the reporting period

-

-

582

-

4,297

Cash and cash equivalents at the end of the reporting period

-

-

451

-

582