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Accrual

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									Glossary

Appendix B

Available-for-sale Financial Instruments Reserve A category of financial instrument which includes investments traded in an active market and equity instruments other than those for which a reliable value cannot be determined. Bank Overdraft Represents the balance held within the authority’s current account which is then reduced to take account of payments made but not yet presented through the account. Borrowing repayable within a period in excess of 12 months Amounts owed by the authority which are repayable within a period exceeding 12 months Capital Adjustment Account The balance represents the timing differences between the amount of historical cost that has been consumed and the amount that has been financed in accordance with statutory purposes. Useable Capital Receipts Reserve The income obtained from selling a capital asset. This is either set aside to the Capital Financing Account for the repayment of loans or used to finance new capital expenditure; the balance sheet will generally incorporate a Capital Receipts Reserve which reflects the excess receipts held to fund future year’s capital programmes. Cash and Bank Represents the balance held within the authority’s current account which is then reduced to take account of payments made but not yet presented through the account. Cash reflects petty cash held by departments within the Authority. Collection Fund The fund administered by each authority collecting council tax (district councils in Northumberland). The County Council precepts on these funds to finance its net expenditure after taking into account other sources of income, e.g. Government Grants, National Non Domestic Rate income and charges for services. Community Assets This is the land and property the Council intends to own forever. They generally have no determinable useful life and there are often restrictions regarding their sale. Examples are parks and open spaces. Creditors Amounts owed by the Council for goods or services that it has received but for which payment has not been made by the year end. Debtors Amounts owed to the Council at the year end where services have been delivered but payment has not been received. Deferred Capital Receipts Represents the future mortgage principal repayments due to the authority from mortgagees.

Deferred Consideration The value of assets leased to contractors which results in an explicit or implicit reduction in contract payments Earmarked Reserves These reserves represent monies set aside that can only be used for a specific usage or purpose. Equal Pay Back Pay Account This account represents the estimated liability resulting from equal pay claims brought by employees seeking compensation for lost back pay and is used to defer the charge to the County Fund pending the actual payment of the claims. The Council has submitted a request to the DCLG to enable the expenditure to be financed from capital. Finance Leases A lease that transfers most of the risks and rewards of ownership of an asset to the lessee. Financial Instruments Adjustment Account This represents the difference between the amounts charged to the Income and Expenditure Account and the recharge against the County Fund balance in respect of financial assets and liabilities. Government Grants and Contributions Deferred Account This represents the difference between expenditure financed by government grant or contributions and the amount released to the Income and Expenditure Account to match depreciation of the asset. Housing Revenue Account The authority has a statutory obligation to account separately for local authority housing provision, this is a ring fenced account and balances held within the HRA must be used for housing functions. Infrastructure Fixed assets belonging to the Council which do not necessarily have a resale value, and for which a useful life span cannot be readily assessed. Long Term Debtors Amounts owed to the Council at the year end where services have been delivered but payment has not been received, these can include Car Loans and Mortgage accounts. Long Term Investment Long term investments comprise of surplus funds with banks or similar institutions. Major Repairs Allowance - Earmarked HRA This reflects income received through the Housing Subsidy system and is the excess grant received in comparison with actual financing required on capital schemes. Non Operational Assets Fixed assets not used or consumed by the Council in the delivery of services or for the service or strategic objectives of the Council such as investment properties (Assets

retained as an investment), Assets under Construction (Capital work in progress) and Surplus Assets Held for Disposal (Assets available for sale). Operational Assets Fixed assets held and occupied, used or consumed by the Council in the direct delivery of those services for which it has either a statutory or discretionary responsibility for the service or strategic objectives of the Council. These incorporate Land/buildings and Council Dwellings used in the provision of the Housing Revenue Account. Net Pension Liabilities The liabilities of a defined benefit pension scheme for outgoings due after the valuation date. Scheme liabilities measured using the projected unit method to reflect the benefits that the employer is committed to provide for service up to the valuation date. Pension Reserve Linked to scheme liabilities and reduces the net worth of the authority to reflect FRS17 legislation which requires a liability to be recognised as the benefits are earned rather than when they are due to be paid. Prepayments Amounts paid by the Council in the year of account that related to goods and services not received until subsequent years. Provisions Provisions represent sums set aside for any liabilities of uncertain amount or timing that have been incurred. Receipts in Advance Amounts received by the Council during the year of account relating to services delivered in subsequent years. Revaluation Reserve The accumulated gains in value on fixed assets held by the Council since 1 April 2007 less the part of depreciation charges that have been incurred because the assets have been valued. Short Term Borrowing Amounts owed by the authority which are repayable within 12 months. Short Term Investments Short term investments comprise of temporary surplus funds with banks or similar institutions. Statement of Movement on the County Fund Balance Statement showing whether the Council has over or under spent against the council tax that it raised for the year, taking into account the use of reserves built up in the past and contributions to reserves earmarked for future expenditure. Stocks The amount of unused or unconsumed stocks held in expectation of future use. When use will not arise until a later period, it is appropriate to carry forward the amount to be matched to the use or consumption when it arises.

Vehicle, Plant and Equipment Fixed assets held and occupied, used or consumed by the Council in the direct delivery of those services for which it has either a statutory or discretionary responsibility for the service or strategic objectives of the Council.


								
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