Agenda item

The Core Financial Statements for the financial year ended 31 March 2019 were presented to the Resources Committee in May.  The report confirmed that:-

·        the unaudited Statement of Accounts would be signed by the Treasurer to certify that it presented a true and fair view of the financial position of the Authority as at 31 March 2019;

·        this would be subject to review by the Authority’s external auditors, Grant Thornton;

·        that a further report would be presented to the Audit Committee in July, following completion of the external audit;

·        at that meeting the Chair of the Audit Committee would be asked to sign the final statement of accounts, as well as the Treasurer;

·        Following this a final audited set of accounts would be presented to the Resources Committee for information.

In light of this, the Committee noted and endorsed the report and core financial statements, based on the various outturn reports presented on the same agenda.

Subsequent to that the full set of accounts were produced and signed by the Treasurer and submitted for audit to Grant Thornton.   The External Audit Findings Report was considered as now presented.

The main issues within the report were as follows:-

• Audit opinion - the auditor would give an unqualified opinion on the financial statement;
• Value for money – the auditors concluded that the Authority had proper arrangements in all significant respects to ensure it delivered value for money in its use of resources.

The draft accounts had been adjusted to reflect the impact of the McCloud judgement on the pension liabilities.  This adjustment which related to costs associated with both the Firefighter Pensions Scheme and the Local Government Pension Scheme, had arose following a legal challenge in respect of alleged unlawful discrimination arising from the Transitional provisions in the Firefighters Pension Regulations 2015.  In 2018 the Court of Appeal ruled that the ‘transitional protection’ offered to some members as part of the reform to public sector pensions amounted to unlawful discrimination.  On 27 June the Supreme Court refused leave to appeal on the McCloud case.  In light of this it was envisaged that the Court would require changes to arrangements for employees who were transferred to the new schemes which would lead to an increase in pension scheme liabilities.  Initial accounting advice provided by CIPFA was to treat this as a contingent liability, however following the Supreme Court’s refusal to allow an appeal the accounting policy adopted by external auditors required the additional liability to be recognised in the accounts.  Hence the accounts had been adjusted for this.  It was noted that the actual impact of an increase in scheme liabilities arising from the judgement would be measured through the pension valuation process which determined employer and employee contribution rates.  Excluding this adjustment there were no other changes to the core financial statements.

The Statement of Accounts was updated to reflect the changes identified and a revised statement of accounts as now presented was approved by the Audit Committee in July.

Given the statement of accounts had already been approved by the Audit Committee; Members determined there was no need to bring them in future to the Resources Committee.

RESOLVED: - That the Committee noted the revised Statement of Accounts as approved by the Audit Committee and agreed there was no need for the Resources Committee to review them in future.