Agenda item

The Committee considered the report reviewing and seeking approval of the accounting policies, actuarial assumptions and materiality levels that would be used for the preparation of the 2022/23 accounts.

The Financial Services Manager introduced the report setting out the accounting policies which would be used when preparing the 2022/23 accounts, the actuary assumptions which had been supplied by the pension actuary Barnett Waddingham and then the materiality levels applied when compiling the Accounts.

The Committee was advised that the timetable to complete the accounts had changed slightly from previous years and  now required authorities to publish their draft accounts by 31^st May 2023 and their audited accounts by 30^th September. The CIPFA code of practice guidance notes for 2022/23 had recently been released and there were no major changes, as the expected change in lease accounting had been moved to 2023/24. The accounting policies had been reviewed and were the same as last year.

Materiality levels had been supplied by the external auditors and were similar to previous years. The actuarial assumptions supplied by Barnett Waddingham were based on market conditions at 31^st January 2023. There were still unknowns about the McCloud and Sargeant judgements for which regulations were  expected to be produced later in 2023. An assessment of the risks associated with closing the Councils accounts and producing the Financial Statements had been undertaken.

A member highlighted the recent collapse of the Silicon Valley Bank and sought clarification that the Council could be responsive if necessary as the review was only made tri annually. The concern was acknowledged, and confirmation was given that end of year reports provided updates between reviews. Fluctuations in the market were emphasised and would feed in to the accounts accordingly. The Chairman reminded members that a letter had been sent to the Council representative on the Pension Board outlining the concerns of the committee.

A member asked about the transfer of leases and their reporting in the accounts. It was confirmed that these were constantly assessed, whilst  final regulations were still awaited, the Council had no significant leases which would be impacted. The difference between commercial properties and investments were outlined including funding. In response to a question the Committee was informed that advice on these matters were received from CIPFA and independent audit advisors.

A member asked about the implications of the McCloud/Sargeant judgements relating to age discrimination against the age-based transitional provisions. It was confirmed that regulations would not be available until later in year so there was no adjustment from previous year’s estimate made in funds. In next year’s accounts it would be included.

Confirmation was given that Auditors were confident they could meet deadlines and audit reports would be received at the next meeting.

Having been moved and seconded on being put to the vote it was unanimously

RESOLVED that:

a)    the proposed Accounting Policies, included at Appendix 1 to the report, be approved;

b)    the pension assumptions (Appendix 2) had been considered and commented on;

c)    the risk assessment (Appendix 3) had been considered and commented on;

d)    the proposed materiality levels, as included in section 5 to the report, be approved;

e)    the key closedown dates at Section 7 had been considered and commented on; and

f)      the main accounting changes for 2022/23 and onwards as shown at section 2 be accepted.