Issue - meetings

This report asks Council to note the annual accounts of Aequus Developments Limited (ADL), Aequus Construction Limited (ACL).

The Council considered the annual accounts of Aequus Developments Limited (ADL) and Aequus Construction Limited (ACL).

Various comments during the meeting highlighted that further clarity was needed for understanding Council company governance arrangements and the role of the Corporate Audit Committee and Corporate Scrutiny Panel in this.  It was noted that the Corporate PDS Panel would be looking at this.  Councillor Samuel acknowledged that it had been a challenge to increase transparency and accountability and welcomed a constructive approach to achieving this.

The Chairman requested that the Chair of Corporate Audit Committee circulate to Members recent correspondence on the need for ADL/ACL scrutiny.

On a motion from Councillor Richard Samuel, seconded by Councillor Mark Elliott, it was

RESOLVED unanimously

1.  To note the ADL 2019/20 year end audited accounts (Appendix 1); and

2.  To note the ACL 2019/20 year end audited accounts (Appendix 2).

Councillor Richard Samuel, Cabinet Member for Resources reminded Panel members that the report looks at the closure of accounts 2019/2020 and that the situation is different now. Andy Rothery, Director of Finance (S151 Officer), introduced the report and stated that it was encouraging to see the improvement in performance.

Tim Richens (ADL Director) reminded the Panel that ADL is a BANES company that looks after rental properties and ACL is a BANES company that looks after housing development.

Panel members asked the following questions and raised the following points:

Officer responses are shown in italics.

Councillor Duguid asked the following questions:

·  What is the role of PDS as opposed to the Audit Committee? The officer explained that the Audit Committee is concerned with the quality of the accounts and PDS looks at the business side of things.

·  If ADL is 100% owned by the council, why don’t we use the council auditors (Grant Thornton) to audit ADL rather than Monahan’s?.

Tim Richens explained that different auditors are needed.

·  Do we need 6 Directors? Tim Richens explained that there are only 2 executive directors.

·  Bonuses have been paid this year – this is not usual practice in the Council. Tim Richens explained that bonuses are paid in line with the scheme approved by the Council.

·  There is little investment compared to 2018/19. Tim Richens agreed that there was more flow in 2018/19 but pointed out that there were 4 properties after the deadline for 2019/20.

Councillor Hodge asked about staffing costs in relation to the accounts. Tim Richens explained that things will look less confusing in the coming year, staff are employed by ADL.

Councillor MacFie asked if there was any collaboration with WECA regarding the flow of new properties. Tim Richens explained that the Government fund has certain conditions and that there must be a degree of separation.

In response to a query fromCouncillor Myers, the officer explained that salaries had been through an independent process.

Councillor Myers asked if the accounts meet the objectives for the period they relate to, are they on track and are bonuses justified? The officer explained that yes, the accounts show a positive achievement of sales and are on target in that year.

Councillor Singleton asked about pension benefits? Tim Richens explained that TUPE staff would be in the Avon Pension Fund and new staff the NEST scheme.

Councillor Hughes asked the following questions:

·  What are the targets of the Company and can we see the business plan. Tim Richens explained that the shareholders set the objectives. There is a 3-year rolling business plan which is approved by the shareholders. The officer explained that another item for the Panel can be arranged when the business plan has been agreed. We can provide the prior year’s business plan.

Councillor Myers asked what the role of the Panel is today. The officer responded that this is a relatively new role to check that things are looking like they are going in the right direction.

Panel discussion  ...  view the full minutes text for item 53