Agenda item

Statement of Accounts 2016-17

This report presents H&F’s Statement of Accounts, including the Pension Fund Accounts, for 2016/17 and the external auditor’s draft opinion on the accounts.


Hitesh Jolapara (Strategic Finance Director) presented the report on the Council’s Statement of Accounts, including the Pension Fund Accounts, for 2016/17 and the external auditor’s (KPMG) draft opinion on the accounts. Hitesh Jolapara tabled an addendum which set out minor adjustments to the accounts which had been agreed with the auditor.


Jennifer Townsend (KPMG) informed the Committee that they intended to issue an unqualified audit opinion on the Authority’s financial statements and the Pension Fund’s financial statements, within the deadline of 30 September 2017.


Jennifer Townsend noted that they had identified the following five key risks – but after investigation no significant issues were found:

·         Valuation of Property, Plant, and Equipment (PPE)

·         Conditional Grant Income

·         Managed Services

·         Pension liability including assumptions and having regard to the potential for significant changes arising from the LGPS Triennial Valuation

·         Valuation of Pension Fund Assets (Pension Fund)


Councillor Michael Adam expressed concerns about the reduction in reserves from £90m to £82m in just one year. Emily Hill (Head of Corporate Finance) responded that the money had been used for one-off and invest to save schemes, some of the significant ones being IT infrastructure costs, LED street lighting to save electricity costs, new pay and display parking machines, and Adult Social Care transformation programmes. These also funded one-off costs in relation to the managed services programme.


Councillor Michael Adam asked if officers had a projection of what further releases from reserves would be required over the next three to four years. He asked where officers saw the level of reserves stabilising. Hitesh Jolapara said that work was being undertaken as part of the medium term financial strategy process and information would be available in the Council’s budget papers produced at the end of the year.


Councillor PJ Murphy noted that KPMG’s report was positive but asked if there were things the Council should be sensitive to over the next year. Jennifer Townsend said the ‘value for money’ consideration would become harder – and new risks were likely to emerge from any transition of managed services.


Councillor Guy Vincent noted the figure under Contingent Liabilities (page 58 of the report) of £10m and asked if it related to several smaller claims or one large claim. Hitesh Jolapara said it related to a single claim.


Councillor Guy Vincent noted that there were an increasing number of Business Rates write-offs (Page 74 of the report). He asked if this was a pattern or if, for example, one large business had won an appeal. Hitesh Jolapara said that there was no specific factor involved in this and write-offs could vary one year to the next.


Councillor Guy Vincent questioned why the Housing Revenue Account dwelling revaluation had moved. Emily Hill noted that the housing stock was revalued every year – the previous year had seen an upward revaluation but 2016-17 saw a downward revaluation. It was also noted that the valuation of the Council’s Housing Stock was subject to a ‘social housing factor’ provided by the CLG


Councillor Donald Johnson asked if there was a risk around developers’ contributions (Section 106 and CIL) with the cooling economic climate. Jo Rowlands said there wasn’t any less of an appetite to develop projects but developers were being more cautious and taking longer to considers their options.



1.         To note the content of the auditor’s ‘Report to those Charged with Governance (ISA260)’ (Appendix 2) stating that the accounts will receive an unqualified opinion, the Council has an adequate internal control environment and has made proper arrangements to secure economy, efficiency and effectiveness in the use of resources.

2.         To note the auditor’s findings, recommendations and the Council’s response to those recommendations as set out in the Report to those Charged with Governance (ISA260).

3.         To approve the management representation letter (Appendix 3 of the report).

4.         To approve the Statement of Accounts for 2016/17, including the Pension Fund Accounts (Appendix 1 of the report).

5.         To approve the Annual Governance Statement which is included in the Statement of Accounts.

6.         To approve the Pension Fund Annual Report 2016/17 (Appendix 4 of the report).

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