Statement of Accounts 2008-09 Audit Committee Fina
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Statement of Accounts 2008-09 Audit Committee Fina

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SOUTH STAFFORDSHIRECOUNCILSTATEMENT OF ACCOUNTS2008/09South Staffordshire CouncilStatement of Accounts 2008/2009Table of ContentsPagesDescription From ToExplanatory Foreword 1 6Statement of Accounting Policies 7 11The Statement of Responsibilities for the Statement of 12 12AccountsThe Accounting StatementsThe Income and Expenditure Account 13 13The Statement of Movement on the General Fund 14 14BalancesThe Statement of Total Recognised Gains and Losses 14 14The Balance Sheet 15 15The Cash Flow Statement 16 17Notes to the Core Financial Statements 18 39The Collection Fund 40 42The Audit Certificate from the Audit Commission 43 43Glossary of terms 44 49EXPLANATORY FOREWORDExplanatory ForewordThe foreword is intended to give a brief explanation of the overall financial aspects of theCouncil's activities and to draw attention to the main characteristics of the Council'sfinancial position.1. Introduction to the AccountsThe Accounts set out in this document have been produced in accordance with thestatutory provisions and codes of practice which apply to local authorities.The Core Accounting Statements comprise: The Income and Expenditure Account (I&E), which summarises the costs andincome relating to the Council's day to day activities. It shows the net cost of allthe services delivered by the Council. The Statement of the Movement on the General Fund Balance, shows howthe activities of the Council have been financed from government ...

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SOUTH
STAFFORDSHIRE COUNCIL
STATEMENT OF ACCOUNTS 2008/09
Description
Explanatory Foreword
South Staffordshire Council Statement of Accounts 2008/2009 Table of Contents
Statement of Accountin Policies
The Statement of Responsibilities for the Statement of Accounts
The Accountin Statements The Income and Expenditure Account
The Statement of Movement on the General Fund Balances
The Statement of Total Reco nised Gains and Losses
The Balance Sheet
The Cash Flow Statement
Notes to the Core Financial Statements
The Collection Fund
The Audit Certificate from the Audit Commission
Glossary of terms
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EXPLANATORY FOREWORD
Explanatory Foreword The foreword is intended to ive a brief explanation of the overall financial aspects of the Council's activities and to draw attention to the main characteristics of the Council's financial position.
1. Introduction to the Accounts The Accounts set out in this document have been produced in accordance with the statutory provisions and codes of practice which apply to local authorities. The Core Accountin Statements comprise: The Income and Expenditure Account (I&E),which summarises the costs and income relatin to the Council's day to day activities. It shows the net cost of all the services delivered by the Council. The Statement of the Movement on the General Fund Balance, shows how the activities of the Council have been financed from overnment rants and income from local taxpayers. The Statement of Total Reco Gains and Losses, ised ether to swhich brin all the reco nised ains and losses of the authority durin the period and identifies those which have and have not been reco nised in the Income and Expenditure Account. The Balance Sheet,which sets out the financial position of the Council as at 31st March 2009. It records the value of the assets owned by the Council and how these have been funded The Cash Flow Statementsummarises the total movement of cash to and from the authority or, simply, where the money came from and where it was spent. This information is not easily obtained elsewhere in the accounts and althou h complex this is a useful summary. The Core Accountin Statements are supported by notes to the accounts. A supplementary statement on theCollection Fundis presented after the notes on the core statements. The Collection Fund accounts for the council taxes and business rates collected from local residents and businesses in South Staffordshire. It shows how this money is then allocated between authorities deliverin services to the people and businesses within the district. These are supported by a Statement of Accountin Policies, which follows this foreword.
2. Council Spendin The Council incurs revenue and capital expenditure durin the year. The Local Government and Housin Act 1989 (“the 1989 Act”), provides that all expenditure must be char ed to a revenue account of the authority unless it can be classified as capital or is one of a limited number of specific exclusions. Generally speakinrevenue expenditurecovers most day-to-day items that are consumed within the year.Capital expenditurerelates to spendin somethin on a of more lastin nature such as the purchase of an asset, which has a life beyond one year. Revenue spendin is financed from Council Tax, fees and char es, overnment rants and other income. Capital spendin is financed mainly from usable capital receipts from the sale of Council assets, overnment rants, contributions and revenue. The schedules below showin total income and expenditure are ad usted to reflect only the District Council's demand on the Collection Fund for its own services, and the net
STATEMENT OF ACCOUNTS 2008/2009 PAGE 1
EXPLANATORY FOREWORD movement in borrowin and investments rather than the full turnover for treasury operations. 2008/20092008/20092007/2008 Summary of Revenue OutturnBud etActualActual £000s£000s£000s Net Cost of Services14,09114,77213,972 Depreciation and asset mana ement reversals(1,710)(1,389)(1,414) Impairment of fixed assets0(15)0 Investment Income(1,475)(1,539)(1,677) Pensions Interest & Expected Return on Pension Assets0511(3) Net Expenditure10,90612,34010,878 Income from Grants(7,066)(7,088)(6,916) Demand on Collection Fund(3,481)(3,481)(3,364) Transfer to/(from) Earmarked Revenue Reserves(28)(116196 Contribution from the Pensions Reserve0(665(265) Transfer from Capital Ad ustment Account0(754(946) Deficit/(Surplus for the Year)331236(417) At the end of the year it was necessary to withdraw £236,000 from the eneral fund reserve in order to balance the Revenue Account, rather than £331,000 as ori inally bud eted. This represents an overall underspend of £95,000. The main items makin this up are shown in the table below. Summary of Ma or Variances Expenditure Increases on: Concessionary Fare Bus Passes Concessionary Fare Tokens Leisure Centre Joint Use Payments Emer ency Drain Repair Grounds Maintenance Electricity Less savin s on: Employee Costs Professional/consultancy fees Corporate insurances Income Reductions on: Development Control Land Char es Buildin Control Less increases on: Recyclin Credits Local Authority Business Growth Incentive Investment Income Industrial Units Ba erid e Park and the Leisure Centres Technical Ad ustments: Transfers From Earmarked Reserves Reduction in Bad Debt Provision Other items (net) Net Underspend
STATEMENT OF ACCOUNTS 2008/2009
£000s £000s 115 94 95 63 57 28 208 45 30 169 160 59 48 96 91 72 38 38 (68) 99 72 (171) (25) (95)
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EXPLANATORY FOREWORD
One of the main points to note is the reduction of £267,000 in income from Development Control (Plannin ), Buildin Control and Land Char es. This is a direct result of the recession and the consequent slow down in house-buildin and sales as well as other types of development.
3. Pensions Disclosure The information contained within this disclosure has been supplied by Staffordshire County Council as the administerin authority of the defined benefit multi -employer pension scheme to which South Staffordshire Council contributes. The notes to the accountin statements show that this Council’s portion of the pension fund shows a net liability (deficit) of ust under £14.5m at 31 March 2009. The effect of this is to reduce the Council’s overall reserves as shown in the balance sheet. This is bein addressed by increasin the employer’s contribution rate to the fund from 13.2% in 2008/09 to 14.7% in 2009/10. These contributions are planned to rise by 1.5% per year to a peak of 20.8% in 2013 14.
The latest formal valuation of the Staffordshire County Council Pension Fund for fundin purposes was as at 31 March 2007.
4. Investments In accordance with best practice the Council carries out its treasury mana ement activities in accordance with CIPFA’s Code of Practice on Treasury Mana ement in the Public Services 2001, which it has adopted as Council policy. The bulk of the Council’s investments are invested with various Buildin Societies, throu h the council’s fund mana ers Tradition. The Council's investments are currently valued at £20.5million.
STATEMENT OF ACCOUNTS 2008/2009
PAGE 3
EXPLANATORY FOREWORD
5. Capital Account The ori inal bud et for capital expenditure totalled £3,859,290. To this was added slippa e from the previous year of £1,330,040. The schemes that this slippa e related to are listed below:-Scheme £ Laches Close, Four Ashes 23,520 Social Housin Grant – Existin Satisfactory 392,500 Dwellin s Plannin Applications e Interface 8,000 Geo raphical Information System 8,140 GIS Positional Accuracy Improvement 25,560 Replacement of Old PC’s 16,870 Electronic Data Mana ement Phase 2 29,080 New Financial Software 35,310 E Forms for Internet 27,130 Stora e Area for Network Device 3,950 Estate Improvements 165,260 CRM System 378,090 Benefits Electronic Claims System 32,300 Mandatory Disabled Facilities Grant 32,770 Penkrid e Swimmin Pool/Chan in 28,480 Bins and Boxes (4,640) Barnfield Sand Beds 11,000 Upper Lake, Perton 67,410 Hi h Street, Kinver 25,000 Wom Brook – Green Fla 6,120 Municipal Cemeteries (11,350) Improvement to Council Offices – Si na e 15,350 Improvements to Council Offices – Double Glazin 1,300 Improvements to Council Offices – Stora e 3,800 Improvements to Council Offices – Sanitary 9,090 Total 1,330,040
Further schemes approved durin the year and schemes identified at Revised Estimates to be transferred to 2009/10 or removed from the pro ramme reduced the Capital Pro ramme by £264,300. They included:-Scheme £ Beacon for the Blind (5,000) Hi h Street, Kinver (25,000) Car Park, Kinver (20,000) Kinver Hi h Street Option 1 (5,000) Civica EDM/CRM Interface 25,000 Estate Improvement (8,000) Revenue & Benefits New Server 93,600 Codsall Swimmin Pool Refurbishments (140,000) Codsall Leisure Centre Refurb Additional Monies 39,000 Laches Close, Four Ashes 8,000 Social Housin Grant – Existin Satisfactory 150,000 Dwellin s Social Housin Grant – Re ional Housin Board 150,000 Licensin Services 1,700 Total £264,300
STATEMENT OF ACCOUNTS 2008/2009
PAGE 4
efThalinFOREWORDALANOTYREPX
£ 7,490 8,557 15,083 29,080 28,516 20,950 3,950 59,923 80,686 21,000 16,775 349,715 14,550 6,000 112,673 21,925 82,210 30,121 29,097 4,325 578 7,539 962 5,000 15,733 12,714 84,183 132,742 1,633 4,927 975 789 63,090 18,790 759,160 150,000 (5,785) 2,195,656
Scheme Geo raphical Information System GIS Positional Accuracy Improvement Replacement of Old PC’s Electronic Data Mana ement – Phase 2 New Financial Software E Forms for Internet Stora e Area for Network Device Personnel and Payroll System Total Land Char es Closure Pro ramme Civica EDM/CRM Interface Estate Improvements CRM System Benefits Electronic Claims System Benefit Notification Letters via Formscape Electrical Inspection Remedial Work Estate Mana ement System Mandatory Disabled Facilities Grants Penkrid e LC Fitness Suite Grants and Loans Bins and Boxes Barnfield Sand Beds Upper Lake, Perton Wom Brook – Green Fla Kinver Hi h Street Option 1 Pedestrian Brid e, Womb Brook Walk Tree Mana ement System/Database Municipal Cemeteries Improvements to Council Offices – Double Glazin Phase 1 Improvements to Council Offices – Sanitary Phase 1 Improvements to Council Offices – Sanitary Phase 2 Improvements to Council Offices – Improved Fire Alarm Improved Waste Handlin Facilities Brick Brid e Lane Open Space, Wombourne Cocksparrow Lane, Huntin ton Social Housin Grant – Existin Satisfactory Dwellin Social Housin Grant – Re ional Housin Board Licensin Software Total
STATEMENT OF ACCOUNTS 2008/2009
PAGE
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EXPLANATORY FOREWORD
A ma or source of finance for capital expenditure in 2008/2009 was Usable Capital Receipts.
2008/20092007/2008 ActualActual £000s£000s Useable Capital Receipts Balance as at 1stApril12,49214,903 Usa e in the Year(2,606)(2,856) Income in the Yea21445 Balance as at 31stMarch9,90712,492 6. Future Challen es Some of the key pressures that the Council faces over the next year are summarised below:  ramme.Capital ProThe Council has approved a capital pro ramme for next year of£3,897,450and this will rise to£6,093,106provided that the proposed capital slippa e is approved. This spendin is more than covered by the anticipated resources available for the year. The pro ramme is desi ned to safe uard existin assets and provide new facilities where resources allow, particularly social housin by payments to housin associations for that purpose. Revenue Commitments.In accordance with the Code of Practice on Prudential Accountin the Council has approved a 5-year medium term financial strate y containin pro ections of its revenue commitments based on current and future service requirements. The on oin recession will force a revision of some of the assumptions underlyin this strate y as will the parlous state of the public finances and the effect that this is certain to have on overnment rant receipts in the future. These issues will be addressed durin the next bud et round. The Euro.The Council continues to monitor the situation. To date it has not been necessary to incur any costs. 7. Further Information Further information on the accounts is available from the Director of Finance Officer, PO Box 1, Council Offices, Codsall, South Staffordshire, WV8 1PX, (telephone 01902 696607, e-mailp.cooper@sstaffs. ov.uk). In addition, interested members of the public have a statutory ri ht to inspect the accounts before the audit is complete. The availability of the accounts for inspection has been advertised in the local press.
Director of Finance Date 30thJune, 2009
STATEMENT OF ACCOUNTS 2008/2009
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STATEMENT OF ACCOUNTING POLICIES Statement of Accounting Policies
General The Accounts have been prepared in accordance with the Code of Practice on Local Authority Accountin in the United Kin dom 2008:A Statement of Recommended Practi ce (the SORP), reco nised by statute as representin proper accountin practices. The accounts for 2008/2009 have been prepared on a historic cost basis with certain assets havin been re-valued for balance sheet purposes.
Accruals of Income and Expenditure Activity is accounted for in the year in which it takes place, not simply when cash payments are made or received. In particular:-Fees, char es and rents due from customers are accounted for as income at the date the Council provides the relevant oods or service; Supplies are recorded as expenditure when they are consumed; Interest receivable on investments is accounted for on the basis of the effective interest rate for the relevant financial instrument rather than the cashflows fixed or determined by the contract;  but cash has not been nisedWhere income and expenditure have been reco received or paid, a debtor or creditor for the relevant amount is recorded in the Balance Sheet. Where it is doubtful that debts will be settled, the balance of debtors is written down and a char e made to service revenue accounts for the income that mi ht not be collected.
Material Reserves and Provisions The Council sets aside provisions for specific future expenses that are likely or certain to be incurred and for which a reliable estimate of the amount can be determined. Provisions are char ed to the income and expenditure account in the year they are established. Provisions for doubtful debts are shown in the Balance Sheet as a reduction to debtors rather than under this headin . The Council maintains certain reserves to meet eneral, rather than specific, future expenditure. Reserves are created by appropriatin amounts in the Statement of Movement on the General Fund Balance. When expenditure to be financed from a reserve is incurred it is char ed to the appropriate service revenue account in that year to score a ainst the Net Cost of Services in the Income and Expenditure Account. The reserve is then appropriated back to the General Fund balance statement so that there is no net char e a ainst council tax for the expenditure. In addition to these reserves, there are amounts held for a special purpose that do not fall into the definition of provisions. These are referred to as "Earmarked Reserves." The expenditure char ed to reserves is included in the Net Cost of Services part of the Income and Expenditure Account. The financin from reserves is shown in the Statement of Movement on General Fund Balances.
Government Grants and Contributions (Revenue) Whether paid on account, by instalments or in arrears, overnment rants and third party contributions and donations are reco nised as income at the date that the authority satisfies the conditions of entitlement to the rant/contribution, there is reasonable assurance that the monies will be received and the expenditure for which the rant is iven has been incurred. Revenue rants are matched in service revenue accounts with the service expenditure to which they relate. Grants to cover eneral expenditure (e. . Revenue Support Grant are credited to the foot of the Income and Expenditure Account after Net Operatin Expenditure.
STATEMENT OF ACCOUNTS 2008/2009 PAGE 7