Agenda item

Publication of the 2022/23 Statement of Accounts

To consider the report of the Director Finance.


The Director Finance presented an update on the publication of the 2022/23 Statement of Accounts and the audit status of the Statement of Accounts for 2020/21 and 2021/22.  The report set out the progress made against the background of the current audit environment. The Financial Reporting Council (FRC) had placed significant pressure on the use of estimated figures by the External Auditors and in relation to the Pension Fund was not acceptable. Further work with Grant Thornton to complete the 2021/22 audit would ensure there was the best estimate of the Pension Valuation position. An actuarial report had been commissioned, which concluded that the Pension Fund liability as at 31 March 2022 had reduced by £24 million. All of these changes have had a cumulative effect of the opening balances of the 2022/23 accounts, but the commissioned report for 2022/23 will update the information in the Statement of Accounts which was now anticipated to be published  mid-August.


The Director Finance responded to the following Members’ questions -


·         the increase in contributions related to current members of staff, but the back funding payment towards the deficit had reduced, so in overall terms the contribution would reduce for the next three years. This was included in the medium term financial plan as approved by Members in February.

·         many of the leisure staff brought back in house, had not been with the Council long enough to have had a local government pension to carry forward, and the impact on the deficit was small.

·         the opportunity to negotiate the Pension Fund contribution had changed, but actuaries still used the current information to determine the conclusion. There had been a positive valuation resulting in the Pension Fund deficit - from an accounting point of view the valuation had changed by £24 million.

·         the Council will be the same position for the Statement of Accounts for 2023/24 which would need to be based on the February estimate, as the accounts cannot be completed in two weeks unless the local government audit regime returns to a better position to enable closing and publishing of the accounts each year by 31 May.

·         the inspection of the Statement of Accounts would commence the day after their publication.

·         this was the first year that Exeter City Council had not met the accounting deadline.

·         there have been challenges in finding suitably qualified surveyors to carry out property valuations for all of the Council’s properties, which required an evaluation over a five year period and commercial property which was valued every year.

·         a Parliamentary Select Committee had been held on the timeliness of local audit reporting and the Local Government Association had been invited to give evidence in relation to the publication of accounts.


The Engagement Lead responded to the following Members’ questions -


·         Grant Thornton had given written evidence at the Parliamentary Select Committee and the report had now been published. There was an understanding that the delay in more recent Audits nationally, needed to be addressed. Measures have been proposed for a small number of cases. The Department for Levelling Up, Housing and Communities (DLUHC) will continue to discuss with audit professionals and the FRC to ensure this work was back on track. Whilst Grant Thornton had not concluded all aspects of their audit at Exeter, the Council would not be subject to those extreme measures having no significant concerns or challenges. She was confident the necessary assurances would be given in the revised timeframe.

·         only one of the authorities that Grant Thornton provide an audit service for had published their accounts by 31 May, Grant Thornton updated that information every month.

Both a Member and the Director Finance had a copy of the letter from the Under Secretary of State for (DLUHC) following on from the Parliamentary Select Committee which would be circulated to Members.


The Audit and Governance Committee noted the progress and barriers to publication of the Council’s Statement of Accounts for 2022/23 and audit status of the Statement of Accounts for 2020/21 and 2021/22.


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