Agenda item

Colleen Warren, Financial Services Manager

a.    presented a report to inform the Audit Committee of an assessment of the Council as a going concern for the purposes of producing the Statement of Accounts for 2019/20.

b.    explained the background of the report as detailed at paragraph 2 and advised that the concept of ‘going concern’ assumed that an authority, its functions and services would continue in operational existence for the foreseeable future.

c.    advised that the report set out the position of the City Council and provided justification for the 2019/20 financial statements being prepared on a ‘going concern’ basis.

d.     highlighted the main factors which underpin the assessment were:

·         The Council’s current financial position

·         The Councils projected financial position

·         The Council’s balance sheet

·         The Council’s cash flow

·         The Council’s governance arrangements

·         The regulatory and control environment applicable to the Council as a local authority.

e.    detailed the Councils current Financial Position and highlighted  the following areas:

·         General Fund

·         Housing Revenue Account (HRA)

·         Covid-19

f.     further detailed the following:

·         The Council’s Projected Financial Position – Revenue Resources

·         The Council’s Balance Sheet as at 31^st March 2020

·         The Council’s Cash Flow

·         The Council’s Governance Arrangements

·         The External Regulatory and Control Environment

·         Material Uncertainties

g.    advised that it was considered that having regard to the Council’s arrangements and such factors as highlighted in the report that the Council remained a ‘going concern’ and the Council’s accounts for 2019/20 had appropriately been prepared on this basis. The report gave that assessment by the Council’s Section 151 Officer in support of presenting the Accounts for approval and provides assurance to Mazars, the Council’s external auditor.

Question: Referred to the financial report being considered by Executive at the next meeting and asked if the report reviewed only 2019/20 financial year and could you provide assurance for the long term?

Response: The report also covered future financial years, there were plans in place to increase the savings targets, with a report to Executive on 23^rd November setting this out. Balances and  reserves would have to be used over the short term but it would level out over the years.

Question: Referred to section 2.14 of the report and asked if the Governance arrangements included the political and decision making process?

Response: The corporate governance framework was set out in the full Annual Governance Statement, this did cover the political and decision making process.

Question: Referred to paragraph 2.16 of the report in relation to additional valuations being required and asked if there was an extra cost?

Response: Internal valuers would be used, there would not be any extra cost to the Council, but there were still resource implications.

Question: Some income streams were reducing, how could certainty that the Council would be in a good financial position be given for next year.

Response: In the current climate financial planning was extremely difficult, there was currently a lot of volatility and uncertainty. It was difficult to forecast going forward, we have to use the best information that we have available to us and continue to review it.

RESOLVED that the outcome of the assessment of the Councils going concern status for the purpose of preparing the Statement of Accounts 2019/20 be accepted.