Agenda Item No. 8

The Vale of Glamorgan Council

Audit Committee: 25th July 2018

Report of the Head of Finance as Section 151 Officer

Unaudited Statement of Accounts 2017/18

Purpose of the Report

The Statement of Accounts for the Vale of Glamorgan Council and the Shared Regulatory Service for 2017/18 and the Annual Return for the Vale, Valleys and Cardiff Regional Adoption Service are now complete and are brought to the Committee for review following the commencement of the external audit.

Recommendations

That the unaudited Vale of Glamorgan Council Statement of Accounts for 2017/18 be reviewed and any comments of the Committee be referred to the Head of Finance as Section 151 Officer for subsequent discussion with the Council's external auditors, Wales Audit Office.
That the unaudited Joint Committee Shared Regulatory Services Statement of Accounts for 2017/18 and the Shared Regulatory Services Annual Governance Statement be reviewed and any comments of the Committee be referred to the Head of Finance as Treasurer of the Joint Committee for subsequent discussion with the external auditors, Wales Audit Office.
That the Annual Return for the Vale, Valleys and Cardiff Regional Adoption Service 2017/18 be reviewed and any comments of the Committee be referred to the Head of Finance as Treasurer of the Joint Committee for subsequent discussion with the external auditors, Wales Audit Office.
That Committee approves that it is proposed to Council in September 2018 that the approval of Audited Accounts is delegated to Audit Committee from 2019/20 Statement of Accounts onwards and the Council's Constitution is amended accordingly.

Reasons for the Recommendations

To allow for the initial review of the unaudited Vale of Glamorgan Council Statement of Accounts by those charged with governance.
To allow for the initial review of the unaudited Shared Regulatory Service Statement of Accounts and Annual Governance Statement by those charged with governance.
To allow for the initial review of the unaudited Valleys, Vale and Cardiff Regional Adoption Service Annual Return by those charged with governance.
To assist with the achievement of statutory Early Closure deadlines.

Background

Under the Accounts and Audit (Wales) Regulations 2014 (as amended) the Statement of Accounts must be certified by the Section 151 Officer before the 30th June as presenting a true and fair view. The 2017/18 Statement of Accounts for the Council and Shared Regulatory Service and also the Annual Return for the Vale, Valleys and Cardiff Regional Adoption Service were certified as such by 15th June 2018.
The 2017/18 Vale of Glamorgan Statement of Accounts will be subject to external audit and the audited accounts will be presented to Audit Committee in September 2018 along with the external auditor's ISA 260 report for review prior to being submitted for approval by Council before 30th September 2018.
The 2017/18 Shared Regulatory Services Joint Committee Statement of Accounts will also be subject to external audit and the audited accounts will be presented to Audit Committee in September 2018 along with the external auditor's report for review prior to being submitted for approval by the Shared Regulatory Service Joint Committee.
The external audit extends to the Annual Governance Statements for both the Vale of Glamorgan Council and the Shared Regulatory Service. The Annual Governance Statement for the Vale of Glamorgan Council is not included in the version attached at Appendix A as it is included under a separate item on the Audit Committee agenda. The Annual Governance Statement for the Shared Regulatory Service is included in Appendix B.
The Vale, Valleys and Cardiff Regional Adoption Service accounts are not subject to a full external audit by Wales Audit Office but an Annual Return has been completed by Accountancy and Internal Audit as at 30th June and is attached at Appendix C. Wales Audit Office will be providing a limited assurance audit for the service.

Relevant Issues and Options

The 2017/18 Vale of Glamorgan Council Statement of Accounts is attached at Appendix A and has been prepared in accordance with the requirements of the International Financial Reporting Standards (IFRS). This is intended to provide for comparable accounts across all accounting boundaries, public and private, national and international. The Shared Regulatory Service Joint Committee 2017/18 unaudited Statement of Accounts is also attached at Appendix B and the Vale, Valleys and Cardiff Joint Committee Annual Return 2017/18 is attached at Appendix C.
It is proposed that any comments of the Committee on the Vale of Glamorgan Council 2017/18 unaudited Statement of Accounts, Shared Regulatory Service Joint Committee 2017/18 unaudited Statement of Accounts or the Vale, Valleys and Cardiff Joint Committee Annual Return 2017/18 be referred to the Head of Finance as Section 151 Officer and Treasurer of the Joint Committees respectively for subsequent discussion with the Council's external auditors, Wales Audit Office.

Early Closure Deadlines

In preparation for the Early Closure deadlines the Accountancy team set a deadline of 15th June 2018 for final sign off of the unaudited 2017/18 accounts by the S151 Officer. This was comfortably achieved by the team which is important prior to the statutory deadline changes that begin in 2019.
Interim arrangements for Early Closure have been put in place for the financial years ending on 31st March 2019 and 31st March 2020. For these financial years, the statement of accounts will need to be signed and dated by the responsible financial officer by 15th June, with an audited statement of accounts published by 15th September. This interim approach will provide the flexibility to identify and resolve any issues ahead of full implementation. It also seeks to reduce pressure on the audit process during the transition to the earlier timetable.
From 2021 the final date on which the responsible financial officer must sign and date the statement of accounts will be brought forward from 15th June to 31st May. It also proposes that the date that the Local Authority must consider, approve and publish an audited Statement of Accounts will be brought forward from 15th September to 31st July.
Having given consideration to the logistics of presenting the audited accounts to two Committees prior to 15th September and ultimately 31st July given the shorter time period available, it is proposed that the Council adopts the approach utilised by some other Welsh Authorities whereby the approval of the audited accounts is delegated to the Audit Committee rather than requiring approval by Full Council.
The Council have discussed this approach with Wales Audit Office and they are broadly supportive of this change in the context of faster closure of accounts.

Resource Implications (Financial and Employment)

The 2017/18 Vale of Glamorgan Statement of Accounts, Shared Regulatory Service Statement of Accounts and the Vale, Valleys and Cardiff Regional Adoption Service Annual Return have been prepared within existing staff resources.

Sustainability and Climate Change Implications

None as a direct result of this report.

Legal Implications (to Include Human Rights Implications)

The Statement of Accounts is prepared in accordance with the Accounts and Audit (Wales) Regulations 2014 (as amended).

Crime and Disorder Implications

There are no Crime and Disorder Implications arising out of this report.

Equal Opportunities Implications (to include Welsh Language issues)

There are no Equal Opportunities Implications arising out of this report.

Corporate/Service Objectives

There are no Equal Opportunities Implications arising out of this report.

Policy Framework and Budget

This is a matter for consideration by Audit Committee as those charged with governance.

Consultation (including Ward Member Consultation)

None

Relevant Scrutiny Committee

Corporate Performance and Resources

Background Papers

2017/18 Unaudited Statement of Accounts and Annual Returns

Contact Officer

Principal Accountant

Resources

Officers Consulted

None

Responsible Officer:

Head of Finance

Section 151 Officer