Chair, on the Statement of Accounts, I move -
1. That the actions taken to amend the Statement of Accounts for 2003/2004 be approved.
2. That the District Auditor’s comments and the consequent responses be both noted and approved.
I’ll take a bit more time in presenting the Statement of Accounts today, in particular because of the difference of opinion between us and the Audit Commission.
Since the corporate inspection of the City Council in 2002, there has been a strong focus on improving the performance of the Council.
This is symbolised by our commitment to the Gearing Up programme.
There has been –
a new emphasis on the focus of reports and preparation for our strategic planning, as shown in –
- our new strategic plan,
- fuller reports supporting the budget, which in turn delivered extra money for our strategic priorities, and
- quarterly public reporting on performance, leading to better prepared Best Value Performance Plans.
Full Council’s focus on the governance of the Council has been on the Strategic Plan, the budget and the BVPP.
The Statement of Accounts has been seen more as a technical exercise, describing how money has been spent in a publicly accountable way.
In our drive for better performance, we have sought to work in partnership with organisations like the Audit Commission and their District Auditors,
and the last annual meeting with them and other inspectors was judged to have been one of the most successful we’ve had.
Our partners have been increasing expectations from what is expected from the Statement of Accounts,
most noticeably the earlier deadline for the initial approval of the Accounts, which triggered the special meeting in August.
Next year, we are to initially report by July, and in June the year after that.
There are examples of other Core Cities who have been able to initially submit their accounts in June, and to advantage, as a way of enabling the Council to move on more quickly to a stronger focus on the new year’s financial monitoring.
So we commit today to review our close down procedures to enable quicker publishing of accounts in future,
and that will in part require even more effective in-year procedures.
We were aware of requested changes to the content, most particularly, on the matter of internal control.
The system of internal control is designed to manage risk to a reasonable level rather than to eliminate all risk of failure to achieve policies, aims, and objectives:
Elements of this are explained in pages 9 – 16 of the Statement of Accounts and include -
- Establishing and monitoring objectives;
- Facilitating policy making;
- Ensuring compliance with established policies, procedures, laws and regulations;
- Ensuring best use of resources;
- Correct financial management;
- Improving performance management.
This reflects the new emphasis on reporting on financial matters and performance matters at the same time,
and the kind of governance now required of corporations following the Grimly (check) Report and the Lord Salisbury report.
In agreeing today’s changes, we recognise that a number of changes have been made at the suggestion of the Audit Commission,
in part cos they have raised their expectations of what is required.
And we will take on the new suggestions on general best practice from the Audit Commission.
The District Auditor’s comments are made within a Statement of Auditing Standard 610 report and this has been attached to the distributed documents.
We hold our hands up on some of their complaints, and
We commit today to do better in future on the points regarding working papers and regarding completeness of papers presented at the initial approval stage.
One can have a small moan and say it might have been nicer to have had earlier notice of some of the higher expectations that the Audit Commission now have and to have had quicker feedback on the accounts we posted in August, but nevertheless we’re happy to make the commitment.
We do say have however, that these our accounts and where we disagree with the Audit Commission – significantly on the NET accrual – we are holding our position.
Today’s reports focus on responding to the Audit Commission - possibly to the detriment of the work of the August Accounts Cttee. who raised a number of issues, most of which have been taken on board.
(a) we now make clear that the budget was set by Council;
(b) that under the Revenue Expenditure section of the Explanatory Foreword the wording will be changed in the final draft;
(c) the explanatory note on the Line One PFI joint scheme ensures that all data relates specifically to the City;
(d) the Glossary will explain the Best Value Performance Indicators;
(e) the Executive Board’s decision to appropriate part of the NET reserve fund is made clear;
(f) on the matter of the value of the investment in EnviroEnergy, we commit to providing an accurate valuation in this financial year;
(g) the entry under the Retirement Benefits has been changed, and
(h) that under the Group Accounts section, Government grants and subventions, operating losses and write-offs have been made more explicit.
For Cllr. Chapman’s benefit, we’ll also remove all of the rogue apostrophes.
It’s a shame I’ve had to read these actions out – as I said, I think the dialogue with the Audit Commission has distracted us from getting it all down in the background papers.
The relevant recommendations from the August Cttee. were forwarded to 3PF, but I have to say, it’s a bit strange passing 2 month old minutes to a meeting and expecting members to act upon them.
We will write to the Chair of 3PF with our understanding on the current situations on the matters passed to 3PF for their attention, for her and colleagues to decide the best way forward.
We commit to ensuring better liaison with 3PF when we pass such news on in future.
It’s a shame there hasn’t been a bit more follow through on the August Accounts Cttee. cos the meeting itself was remarkably positive. Especially for a meeting in August. And especially for a meeting on the accounts.
Amazingly, some members enjoyed it so much, they suggested regular 3 monthly audit meetings.
I have previously undertaken that Statement of Accounts shall be agreed at Full Council, as required by the Constitution.
But I think the Accounts Committee was a useful forum for more effective scrutiny of accounts and would ask colleagues to reflect on how best to review the Accounts as part of the new Gearing Up exercise on the political governorship of the Council.
We also commit to publishing the final version of the accounts on the council website.
Chair,
we will meanwhile keep working at more effective strategic and operational planning.
That means –
closer links between financial and performance management,
a stronger connection between the big objectives of the organisation and individuals’ understanding of their day to day role, and
more streamlined support activities (for example HR, procurement, IT) to deliver the business.
We will soon propose a new emphasis on customer focus which will see a continuation of efforts to improve services,
but also encompass customers’ experience of dealing with the Council in reception areas, via correspondence, through the website and their personal interaction with our staff.
I regret the length of today’s speech, but have felt it necessary in the light of our one disagreement with the Audit Commission to stress how hard and how well we are working on the other matters of mutual concern.
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[Last updated 2004-11-22]
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