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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.