Agenda item

Tim Richens, Divisional Director (Finance) introduced the report and drew the Committee’s attention to the report in a number of places.  He reminded the Committee that the Budget vs. Actual figures (page 7) were the same figures which had been reported to Cabinet in July.  The report also included the Summary of Capital Expenditure, split by service department, the General Fund Balances and Reserves, and the Property Plant and Equipment (excluding commercial estate).

Councillor Barry Macrae congratulated officers for their very clear presentation of the complex accounts.  He expressed disappointment that there was not a single page summary, as an aid to the public.

Irene Draper said that as in previous years, there would soon be available a 6-sheet summary.

Councillor Will Sandry referred to the Cash Flow Statement (page 13) and observed that the available cash had increased by £7M in the year.  He asked if there was a reason for this, given that the Council had borrowed several million pounds.

The Divisional Director (Finance) explained that the available cash included borrowings held in cash equivalents, and assured the Committee that the Council always sought to minimise and delay borrowings by prudent use of available cash.

Councillor Andy Furse referred to the “step change” in the Children’s Services area of the Income and Expenditure Account (page 11) and asked why this had happened.

Irene Draper explained that this had been brought about because of a different way of recording notional depreciation of school buildings, so the two years were not directly comparable.

Councillor Geoff Ward asked for an explanation for the improvement in Short Term Creditors (page 12).

Irene Draper explained that this was mainly as a result of better debt collecting.

Councillor Ward was concerned that the Bank Overdraft (page 12) was reported as £14M.

Irene Draper assured the Committee that there was always cash to balance the overdraft, and that the overdrafts did not cost the Council any interest.

Councillor Ward asked about the “surplus assets” of £26M (page 12), which he felt seemed very high.

Irene explained that to a large extent these were assets no longer being used by services but which had not yet been sold off.

Councillor Andy Furse asked whether the Council should look at this with a view to selling or bringing back into use.

The Divisional Director (Finance) said that the situation was considered on a monthly basis by the Capital Strategy Group.  He observed that the proceeds from the sale of educational assets could only be reapplied to educational use, and there was often a delay before assets could be sold.

Chris Hackett (Audit Commission) observed that the disclosure of assets was a new requirement, but was successful in ensuring more openness in accounts.

[At this point, the Chair pointed out to the Committee that before considering the officer’s recommendations to this report, it would be necessary to consider the two Governance Reports (items 12 and 13 on the agenda), and then to return to the debate and vote on this current item.  The Committee agreed to this approach.]