IN SCOTLAND THE QUARTERLY NEWSLETTER OF CIPFA IN SCOTLAND

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					                                                                IN SCOTLAND


THE QUARTERLY NEWSLETTER OF CIPFA IN SCOTLAND | FEBRUARY 2006
                               in Scotland




 Angela Scott             Don Peebles             Tim Burrows             Robert Hogg             Helen Mackay
 Head of CIPFA in         Policy and              Policy and              Business                Events Manager
 Scotland                 Technical Manager       Technical Officer       Development
                                                                          Manager
 angela.scott@cipfa.org   don.peebles@cipfa.org   tim.burrows@cipfa.org   robert.hogg@cipfa.org   helen.mackay@cipfa.org
 Direct Dial:             Direct Dial:            Direct Dial:            Direct Dial:            Direct Dial:
 0131 559 3606            0131 559 3613           0131 559 3601           0131 559 3608           0131 559 3609




CIPFA in Scotland
Fettes Park
496 Ferry Road
Edinburgh
EH5 2DL
T: 0131 551 2100
F: 0131 551 2223

www.cipfascotland.org.uk

                                                                                                                           2
contents
      04 BRIEFING
        Angela Scott, Head of CIPFA in Scotland discusses Norman Drummond’s
        Tonypandy Test and explains its relevance to CIPFA members.



      06 TECHNICAL UPDATE
        Local Taxation Review / Public Benefit OFR’s / Abolition of Council Tax Bill
        / Governance / Sustainability



      08 LASAAC
        Landfill Allowance Trading Scheme / Guidance Notes for Local Authority
        Practitioners 2005/6 / LASAAC Next Meeting / LASAAC Website



      09 GOVERNMENT SECTOR BRIEFING
        This periodic sector briefing on government will provide updates on
        matters affecting finance professionals in the Scottish Executive and all
        other government bodies.


      11 HOUSING ASSOCIATIONS SECTOR BRIEFING
        The sector briefing on Housing Associations is provided by Arthur
        Cockburn, Finance Manager at Prospect Housing Association.



      12 MEMBERS NEWS
        Centenary Celebrations / Tom Sowerby Award 2006 / CIPFA Learning
        Centre Update / CETC East Scotland Students Exam Results



      14 CAREER
        In this edition of CIPFA Scottish News, we welcome Change CRS, a new
        partner organisation for CIPFA. In the first of a series of regular career
        and recruitment articles, Julia Coltart, Managing Consultant in the Public
        Sector Finance Division, discusses the positive prospects for talented
        finance professionals balanced against the need for professional career
        advice




                                                                                       3
BRIEFING




The Tonypandy Test
Norman Drummond, is the author of The Spirit of Success
and was a speaker at last years CIPFA Annual Scottish
Conference. In his book there is a chapter entitled Everyone
Matters which promotes the principle everyone has
something of value to offer, talent to be developed or a
contribution to make.
                               Norman then goes on to share an       hard very late into the evening.
                               anecdote about George Thomas,         Despite his lack of academic, or
                               Viscount Tonypandy and Speaker of     musical ability, the boy was one of
                               the House of Commons between 1976     the best all round contributors. He
                               and 1983. The anecdote describes      was always available to help and was
                               how Norman arrived with George at     attentive to fellow students or
                               chapel to find adaptation work in     member of staff in need.
                               progress to accommodate a set for a      George spoke to the boy for a little
                               forthcoming major school musical      while, at the end of which George
                               production. A senior student, by no   stood back and said “well then young
                               means an academic, was working        man, I can tell you one thing. You are



                                                                                                               4
BRIEFING




going to lead a very useful life”. And     steps in achieving this goal. Firstly,     energy, goodwill, and sensitivity to
he has. Apparently to this day he          we need to achieve high levels of          encourage CIPFA students along the
remembers George’s words of                student registrations. We have had         journey to qualification. In other
encouragement making him realise           significant success in this in the last    words ask yourself this. Would I pass
how much he mattered and how               five years. Registered students must       or fail the Tonypandy Test.
important his contribution was, both       then successfully complete their              2006 is an important year in the
in school and beyond.                      examinations to become full                history of the Institute in Scotland in
    Norman has since developed what        members of the Institute.                  that it is the centenary of the
he refers to as “The Tonypandy Test”.      Unfortunately, this is where we have       “Scottish Branch” of which every
If you were given a relatively short       been less successful. Let me return        CPFA in Scotland is a member. The
                                                                                      origins of the Branch, and
                                                                                      consequently the presence of the
  If you were given a relatively short briefing about an
                                                                                      Institute in Scotland, can be traced
  individual in your office, would you be able to show                                back to a few key individuals. Without
  interest and encouragement in that person’s life?                                   the energy commitment and
                                                                                      endeavours of those early pioneers
briefing about an individual in your       to Norman Drummond and George              the opportunities which CIPFA
office, would you be able to show          Thomas at this point.                      members, past and present have
interest and encouragement in that            What role have you played in the        enjoyed would not have existed.
person’s life? Would you leave them        life of a CIPFA student to ensure that        So in this centenary year it is right
feeling good about themselves and          they fulfil their potential and achieve    that we look back and celebrate the
their contribution? Would you enable       their best? Have you given them            past 100 years. It is also important
them to fulfil their potential and         words of encouragement? Perhaps            however to look to the future.
achieve their best?                        you recognise someone in your              Membership is the lifeblood of the
You may well be asking what has this       organisation who, like the senior boy,     Institute and strong membership
to do with being a CIPFA member? A         with a few words of encouragement          growth secures the future of CIPFA.
lot I think. Let me explain. If you        could fulfil their potential. As a CIPFA   So let your contribution to the
replace the individual in your office in   member, what have you done to              centenary celebrations be in taking
the above paragraph with a CIPFA           encourage them to study for CIPFA?         the Tonypandy Test. Give words of
student or a potential CIPFA student          The Institute is debating how we        encouragement to potential and
then you’ll begin to understand.           improve the conversion rate from           existing CIPFA students in order that
   The Institute is presently              registered students to qualified           they may fulfil their potential. In doing
developing its long term strategy for      CPFA’s. Perhaps the answer in some         so not only will you make a difference
the next five years. One of the main       way rest with all of us as members of      to them, you would make a difference
aims of the Institute is to grow the       the Institute. Ask yourself, like I am     to the Institute.
membership. There are two critical         asking myself, whether you have the


                                                                                                                                  5
TECHNICAL UPDATE


LOCAL TAXATION                                                                    OFR’S IN THE
                                                                                  PUBLIC
REVIEW                                                                            SECTOR
Readers of CIPFA Scottish News will be aware of the ongoing independent
                                                                                  Reporting Standard 1, “Operating and
review of local taxation in Scotland. The review committee, chaired by Sir
                                                                                  Financial Review2 was issue by the
Peter Burt, is now in the latter stages of the second phase of the review:
                                                                                  ASB in May 2005. The standard was
receiving oral evidence from expert witnesses. The CIPFA Scotland Policy &
                                                                                  intended to apply to all listed
Technical team gave evidence to the Committee on 6 February. The team was
                                                                                  companies in the UK and any other
questioned on CIPFA’s preference to retain a property based system of local
                                                                                  entities which produce an operating
taxation. The present costs of administering and collecting council tax and
                                                                                  financial review statement (OFR).
non-domestic rates were explored.
                                                                                     CIPFA, in partnership with Robson
   The team was also invited to expand upon the Institutes’ work on local
                                                                                  Rhodes, has prepared a discussion
income tax, and in particular on the likely costs, should a system of local
                                                                                  paper entitled “Public Benefit OFR’s
income tax which supplemented council tax be implemented.
                                                                                  A Catalyst for Enhancing
   The report from the Committee is now anticipated between late summer
                                                                                  Accountability?” This paper considers
and early autumn of 2006.
                                                                                  the issues for public benefit entities
   You can monitor progress of the work of the review committee at
                                                                                  including:
www.localgovernmentfinancereview.org

                                                                                      the merits of applying and
                                                                                      application of RS1 to public
                                                                                      benefit entities;
                                                                                      what is the audience for OFR’s?
                                                                                      to what extent can existing
                                                                                      published information be used in
                                                                                      the OFR?

                                                                                  The paper also discusses the issues
 ABOLITION OF COUNCIL TAX BILL                                                    which may arise from public policy
                                                                                  changes and from changes to the
                                                                                  political administration of a public
Local taxation was also the subject of recent, but separate, consideration and
                                                                                  body.
debate by the Scottish Parliament. On 1 February, Parliament considered and
                                                                                     The paper has been widely
debated a Private Members Bill which proposed the abolition of the Council
                                                                                  circulated and comments are sought
Tax and the introduction of a Scottish Service Tax. The Bill had been
                                                                                  from all practitioners and
considered in detail by the Local Government and Transport Committee. The
                                                                                  stakeholders to identify the most
Committee had called for evidence in November 2005 from the CIPFA Policy &
                                                                                  appropriate form of narrative
Technical team and this was reported previously in CIPFA Scottish News. The
                                                                                  reporting for the various sectors.
Scottish Executive opposed the Bill and reaffirmed its commitment to the
                                                                                  Comments are invited by 20 March
independent Burt review (see article entitled Local Taxation Review). The
                                                                                  2006. You can download the
motion, proposed by Tommy Sheridan MSP was defeated. Mr Sheridan has
                                                                                  discussion paper and contribute to
subsequently lodged a further proposal for a private members Bill which sets
                                                                                  the debate at www.cipfa.org.uk/cgi-
out proposals for the setting of non-domestic rates to be returned to local
                                                                                  bin/CIPFA.storefront/EN/product/FM
authority control. You can read details of the proposal within the consultation
                                                                                  034
document at www.scottish.parliament.uk/business/bills/membersBills



                                                                                                                           6
TECHNICAL UPDATE

                                                                                  SUSTAINABILITY
                                                                                  IN THE PUBLIC
                                                                                  SECTOR
                                                                                  At the end of 2004, CIPFA issued a
                                                                                  publication entitled Advancing
                                                                                  Sustainability Accounting and
                                                                                  Reporting: An Agenda for Public
                                                                                  Service Organisations. The report
                                                                                  sought to advance the debate on
                                                                                  sustainability. The report set a
                                                                                  challenge to the wider public services
                                                                                  by commencing discussion on the
                                                                                  subject of sustainability. This
                                                                                  discussion paper recognised that



 GOVERNANCE
                                                                                  reporting on sustainability is an
                                                                                  emerging area and that key questions
                                                                                  require to be addressed,including
                                                                                  how reporting should be developed.
                                                                                     Sustainability is generally
CIPFA has been directly involved in      which is presently reviewing and         recognised as being the ability of one
leading and supporting the               considering an update to the             generation to meet its resource
development of governance in the         framework document “Corporate            needs without compromising the
public sector. Over a number of years    Governance in Local Government”.         ability of future generations to meet
much has been written about                 Governance will be the subject of a   its needs. Sustainability accounting
governance. At its simplest however it   two day course held by CIPFA             and reporting, for the purpose of the
is about the way in which public         Scotland called Essentials of            discussion paper, has the following
service organisations manage             Governance. It takes place on 24 & 25    working definition:
themselves in delivering services to     April at the Radisson SAS Hotel in          ‘A public account of an
the public. It embraces every type of    Edinburgh. The course offers             organisation’s sustainability
public organisation from schools and     participants a unique opportunity to     performance achieved through a
voluntary groups to major                consider the foundations of good         combination of: leadership; strategic
government departments.                  governance in their own organisation     partnering; stakeholder engagement;
Governance therefore, is at the heart    and how it impacts. The course will      policy outcomes; and the
of delivering good quality public        be of particular interest to executive   management of the organisations
services and more is expected from       managers or board members with           impacts on the local environment,
those who govern in terms of             responsibility in health, education,     social well being and economic
standards, behaviour and outcomes.       housing, social work, criminal justice   prosperity
CIPFA and IPF have developed a           or any other aspects of publicly            CIPFA has launched a microsite to
dedicated governance website to act      funded services. More information        raise and maintain awareness of the
as a portal for all public sector news   about the course content and online      development of this increasingly
and developments on governance.          booking can be found at                  important area. You can visit the
www.cipfagovernance.net includes         www.cipfascotland.org.uk or by e-        microsite and download the
news on the progress of the              mailing robert.hogg@cipfa.org for        publication at
CIPFA/SOLACE Joint Working Group         information and a booking form.          www.cipfa.org.uk/pt/sustainability




                                                                                                                           7
FINANCIAL REPORTING
STANDARDS

This new and expanded section of CIPFA Scottish News will provide selected up to date information
and commentary on the development of Financial Reporting Standards. This section will also include
up to date information on the development of auditing standards and other guidance provided by the
Auditing Practices Board.


FRS 25 - FINANCIAL INSTRUMENTS:                                                      FRS 28 -
DISCLOSURE AND PRESENTATION & FRS 26 -                                               CORRESPONDING
FINANCIAL INSTRUMENTS: MEASUREMENT                                                   AMOUNTS
Financial instruments cover a large       instruments’; and 37 ‘Purchase and         FRS 28 sets out the requirements for
area, and their capacity to provoke       sales of own shares’. FRS 25 also          the disclosure of corresponding
controversy is demonstrated by the        replaces the offset rules in FRS 5         amounts (also known as comparative
protracted deliberations on EU            ‘Reporting the substance of                figures in other standards) in
adoption of these standards. Much of      transactions’.                             financial statements. This builds on
the content FRS 25 and FRS 26 (and        As well as the complex instruments         recent changes to company law and
their international counterparts          mentioned above, the new standards         largely replicates previous legal
International Accounting Standard         encompass simple instruments such          requirements on corresponding
(IAS) 32 and IAS 39) relates to           as cash and receivables.                   amounts.
complex instruments, many of them         Furthermore, the extent of                 In summary:
derivatives, which are unlikely to be     disclosures and the potential volatility
commonplace in the public services.       in performance statements                      • corresponding amounts are to
Nevertheless the scope of these           engendered by a much more                        be shown for items in primary
standards is broad. FRS 25 in             widespread use of fair value are likely          financial statements and notes;
particular is wider in scope than its     to pose challenges for public                  • corresponding amounts which
predecessor, FRS 13.                      services.                                        are not directly comparable
                                                                                           with the current financial year
FRS 25 also has the effect of             These new standards have potential               shall be adjusted;
withdrawing FRS 4 ‘Capital                implications for the valuation of
instruments’, except for material on      financial assets and liabilities and the       • most exemptions in the
the measurement of debt, and gains        treatment of gains and losses on the             Companies Act 1985 are
and losses on the repurchase of debt.     early redemption of debt that could              maintained; and
This material is withdrawn for entities   have a substantial effect on the               • corresponding amounts are not
applying the measurement                  ‘bottom line’ and taxation.                      required for earliest period
requirements in FRS 26, but remains                                                        presented where financial
applicable for other entities.            These issues are discussed more fully            statements for two or more
                                          in how these standards might be                  consecutive periods are
FRS 25 and FRS 26 will also               applied to local authorities in a                presented together.
supersede three UITF Abstracts: 11        LASAAC discussion paper at
‘Capital instruments: issue call          www.cipfa.org.uk/scotland/lasaac.cf        The requirements of the FRS apply
options’; 33 ‘Obligations in capital                                                 except where an accounting standard
                                                                                     or Urgent Issues Task Force abstract
                                                                                     requires or permits an alternative
FRS 27 - LIFE ASSURANCE                                                              treatment. It applies to accounting
                                                                                     periods that begin on or after 1
The foreword to FRS 27 states that it “applies to all entities that have a life      January 2005 and which end on or
assurance business, including a life reinsurance business”. As such, its direct      after 1 October 2005, and as such will
impact on Public Sector bodies is limited.                                           impact on financial year ending 31
                                                                                     March 2006.



                                                                                                                              9
FINANCIAL REPORTING
STANDARDS



FRS 29 - FINANCIAL
INSTRUMENTS: DISCLOSURES
                                          GUIDANCE PROVIDED BY AUDITING
FRS 29 implements international
                                          PRACTICES BOARD
financial reporting standard (IFRS) 7     CIPFA Scottish News reported               expressed by any individual and also
‘Financial instruments: Disclosures’      previously that, the Auditing Practices    covers situations where auditors
and the related amendment to IAS 1        Board (APB) is providing guidance to       report on matters that do not affect
‘Presentation of financial statements     assist auditors in the process of the      the opinion on the accounts; they
– Capital disclosures’, and applies to    ongoing international harmonisation        adopt an appropriate level of
accounting periods commencing on          of Reporting and Accounting                significance that may differ from the
or after 1 January 2007. FRS 29           Standards.                                 materiality level set for the
replaces the disclosure requirements                                                 accounts;
of FRS 25 (IAS 32) ‘Financial             This has continued in 2006 with the
instruments: Disclosure and               issue of a revised version of Practice    • ISA 510 which explains that
presentation’. The disclosures            Note 10, which deals with the “Audit        predecessor auditors are expected
required by the FRS include:              of Financial Statements of Public           to co-operate in dealing with
                                          Sector Bodies in the United                 enquiries and requests for
• information on the significance of      Kingdom”. This revision of Practice         information from the incoming
  financial instruments for an entity’s   Note 10 includes updated guidance           auditor;
  financial position and performance;     for auditors following the
                                          replacement of the APB’s Statements       • ISA 570 which deals with the
• information about exposure to risks     of Auditing Standards (SASs) with           circumstances in which a public
  arising from financial instruments;     International Standards on Auditing         sector entity may cease to continue
  and                                     (ISAs). It also takes account of legal      in its operational existence, and
                                          and regulatory developments                 provides guidance on the treatment
• the entity’s objectives, policies and   affecting public sector bodies in the       of such an entity; and
  processes for managing capital.         United Kingdom since the previous
                                          Practice Note 10 (Revised) was issued     • ISA 700 covers the auditor’s report.
FRS 29 applies only to entities within    in April 2001.                              Illustrative auditor’s reports for
the scope of FRS 26 — that is, listed                                                 public sector entities are provided
entities and entities that use the fair   The more significant ISAs include:          in APB bulletin 2006/2 on public
value accounting rules of the                                                         sector audit reports. This guidance
Companies Act 1985 to produce their       • ISA 220 which requires public             was developed to provide illustrative
financial statements. Certain               sector auditors to consider the           auditor’s reports on public sector
companies have been exempted from           circumstances in which an                 financial statements in the United
the requirements. These include             engagement quality control review         Kingdom that supersede those
parent companies and 90% controlled         of the audit is necessary with            included in the previous Practice
subsidiary companies, on condition          reference to the size and                 Note 10, and was issued earlier this
that there are publicly available           characteristics of each entity;           year.
consolidated financial statements that
do comply.                                • ISA 320 which states that the           The guidance referred to above, as
                                            assessment of materiality be made       well as the International Standards on
More information on Financial               with reference to the expectations      Auditing, can be downloaded at the
Reporting Standards is available at         of users of the accounts, but is not    APB website
the Accounting Standards Board              dictated directly by any interest       http://www.frc.org.uk/apb
website at http://www.frc.org.uk/asb


                                                                                                                              10
                       LOCAL AUTHORITY (SCOTLAND) ACCOUNTS ADVISORY COMMITTEE




                                                                                 LASAAC NEXT
                                                                                 MEETING
                                                                                 The next meeting of the
                                                                                 Committee will take place on
                                                                                 Monday 13 March 2006. The
                                                                                 Committee will, in advance of
                                                                                 the CIPFA/LASAAC Joint
 GUIDANCE NOTES FOR LOCAL                                                        Committee, consider the

 AUTHORITY PRACTITIONERS 2005/6                                                  response from stakeholders to
                                                                                 the proposed amendments to
                                                                                 the 2006 SORP. The proposals
The guidance for local authorities on    to receive technical assistance and     to eliminate notional interest,
the 2005 SORP and which applies to       guidance on local authority             comments on FRS 25 and FRS
financial year 2005/6 has been           accounting. Specific technical          26 and the proposed
released. The guidance notes not         queries can be answered by calling      modification to the financial
only address the changes to the 2005     Don Peebles or Tim Burrows at the       statements will form the key
SORP, but also provide wider             CIPFA Technical Enquiry Service (see    features of the Committee’s
guidance on local authority              inside cover of Scottish News for       deliberations.
accounting.                              contact details). Additionally,
   The guidance, amongst other           practitioners can attend the
things, includes an example              forthcoming Local Government
statement of accounting policies,        Practitioners Update in which the       LASAAC
clarification on leasing, and deferred   2005 SORP will be specifically
charges.                                 addressed.                              WEBSITE
   Local authority practitioners in
Scotland have further opportunities      www.cipfascotland.org.uk/events         The LASAAC website has
                                                                                 undergone the first phase of
                                                                                 development. The site now

LANDFILL ALLOWANCE                                                               includes a news page upon
                                                                                 which any developments in
                                                                                 local authority accounting will
TRADING SCHEME                                                                   be announced. Guidance issued
                                                                                 by LASAAC on reserves,
This scheme has been under consideration by CIPFA’s Local Authority              insurance, FRS 17 and trading
Accounting Panel and will shortly result in the issue of a bulletin which        accounts is contained within the
provides guidance on accounting treatment to local authorities in England. The   site. Comments on the website
scheme enables landfill allowances to be traded between local authorities and    are welcomed, including
requires that a valuation be placed upon the allowances. In Scotland, the        suggestions for improvement,
governing regulation is “The Landfill Allowances Scheme (Scotland)               and can be emailed to
Regulations 2005 (Scottish Statutory Instrument No 157)”. Regulation 8, which    lasaac@cipfa.org
allows for the transfer (or trading) of landfill allowances does not however
come into force until 1 April 2008. This means that the accounting treatment
envisaged for local authorities in England will not be applicable in Scotland
until 2008/9.




                                                                                                                    8
GOVERNMENT
SECTOR BRIEFING
This periodic sector briefing on government will provide updates
on matters affecting finance professionals in the Scottish
Executive and all other government bodies.


THE SCOTTISH PUBLIC
FINANCE MANUAL
The Scottish Public Finance Manual (SPFM) has been amended to take
account of developments since its last revision in July 2005.


The substantive changes include an       and procedures for the annual           members, one of whom should take
expanded Grant & Grant in Aid            budgeting process, the format of the    the chair. In the case of DACs
section, including guidance on:          budget documents and procedures         independent external members
                                         for in-year reallocation of budgetary   should not be Scottish Executive
    the introduction of a charge /       provision.                              members of staff. Departmental
    clawback condition over a               The section on Severance, Early      Accountable Officers should attend
    publicly funded asset (note this     Retirement & Redundancy Terms           meetings of DACs together with any
    also affects the section on          has been revised to clarify that        other relevant persons but should not
    Disposal of Tangible Fixed           proposals for compensation              be members.
    Assets);                             payments that do not conform to any        Finally, Annex 2 to the section on
                                         approved scheme must be referred        Annual Accounts, which provides
    funding asset creation and           to the relevant departmental Finance    guidance on the Retention of
    maintenance through                  Team for approval before any offer is   Financial Records, has been updated.
    endowments or dowries; and           made.                                   It now includes links to the Generic
                                            The independence and                 Retention and Disposal Schedule for
    using assets as collateral or to     transparency of audit committees        Financial Records on the website of
    generate income                      has been strengthened.                  the UK National Archives and to HM
                                         Departmental Audit Committees           Customs and Revenue guidance on
The guidance on certification by         (DACs) should now comprise only         the retention of records relating to
external auditors has also been          non-executive / independent external    VAT.
revised to make it clear that such
certification should not be considered
the norm.
                                           Finance Guidance note FGN 2006/01 provides further detail
  A new section, entitled the ‘Annual
Budgeting Process’, has replaced the       on these amendments, and can be found at
previous guidance on Departmental          www.scotland.gov.uk/Topics/Government/Finance/spfm/GuidanceNotes
Budgets. It includes a link to the
recently revised Written Agreements        The SPFM itself can be found at
between the Scottish Executive and
                                           www.scotland.gov.uk/Topics/Government/Finance/spfm/Intro
the Scottish Parliament Finance
Committee covering the principles




                                                                                                                         9
GOVERNMENT
SECTOR BRIEFING




 THE GREEN BOOK
The Treasury’s Guide to Appraisal and Evaluation in Central Government
(“The Green Book”) is described as “binding guidance” for departments and
for executive agencies but can be relevant to all public sector appraisals and
evaluations.
Its rules apply to all new policies,    to ensure that no policy, programme            in practice often implicitly
programmes and projects; whether        or project is adopted without first            bundled up in the old 6% real
“revenue, capital or regulatory” and    having the answer to these questions:          figure;
the stated purpose is to ensure that
                                                                                       the inclusion of an explicit
these initiatives are subject to             Are there better ways to achieve
                                                                                       adjustment procedure to redress
comprehensive review.                        this objective?
                                                                                       the systematic optimism that
   The Foreword to the revised Green
                                             Are there better uses for these           historically has afflicted the
Book states;
                                             resources?                                appraisal process; and
   “Appraisal, done properly, is not
rocket science, but it is crucially     The main changes in the new edition            greater emphasis on assessing
important and needs to be carried out   are:                                           the differential impacts of
carefully. Decisions taken at the                                                      proposals on the various groups
                                             a stronger emphasis on the
appraisal stage affect the whole                                                       in our society, where these are
                                             identification, management and
lifecycle of new policies, programmes                                                  likely to be significant.
                                             realisation of benefits;
and projects. Similarly, the proper
evaluation of previous initiatives is        an “unbundling” of the discount       Although the Green Book is written
essential in avoiding past mistakes          rate, introducing a rate of 3.5% in   with Central Government bodies in
and to enable us to learn from               real terms, based on social time      mind, as stated in the introduction, “it
experience.”                                 preference, while taking account      is relevant to all appraisals and
   The purpose of the Green Book is          of the other factors which were       evaluations”.


                CIPFA has issued a briefing paper on the Green Book revisions, which you can read at
                              www.cipfa.org.uk/pt/download/green_book_briefing.pdf

     In addition, there is a dedicated Green Book website, which can be found at http://greenbook.treasury.gov.uk


                                                                                                                              10
Housing Associations
SECTOR BRIEFING

The sector briefing on Housing Associations is provided
by Arthur Cockburn, Finance Manager at Prospect
Housing Association.


ACCOUNTING ORDER                                                                     VAT–RIVERSIDE
Communities Scotland have indicated that they will be commencing the                 TRIBUNAL
process of putting together a new Accounting Order, and bring the 1999 Order
up to date. The Order lays down accounting requirements for registered social        The VAT Tribunal for the Riverside
landlords (RSLs) to ensure that their accounts give a true and fair view of the      case, which was related to the
state of their affairs, and comply with regulatory requirements. It is intended to   original Cardiff Community Housing
bring reporting requirements for RSLs into line with generally accepted              case, has now been decided in favour
accounting practice and sets out how legislation applies to statutorily              of HM Revenue & Customs. Once the
registered RSL financial statements.                                                 full narrative of the case is released,
   With the timescales involved in the preparation and for passing legislation, it   a more detailed discussion of the
may be ready for the 2007 financial statements. It is expected however that it is    decision will be forthcoming and will
more likely be in force for the 2008 financial statements.                           be reported in Scottish News.



OSCR
CHARITY
TEST
CONSULTATION
RESPONSE
                                            SCOTTISH EXECUTIVE
The Scottish Federation of Housing
Associations (SFHA) has submitted a
                                            HOUSING INVESTMENT
response to the recent OSCR
consultation exercise on the              SFHA has been advised that the             Strategic Housing Investment
operation of the new Charity Test. A      Transfer of the Management of              Framework (SHIF) will be to enhance
copy of this response can be viewed       Development Funding will not be            the strategic role of local authorities
on the SFHA website. The main             extended to other local authorities        in relation to housing. SFHA will be in
points of the response relate to the      beyond Edinburgh and Glasgow. This         further dialogue with the Executive
position of Housing Co-operatives         decision has been taken by the             regarding a draft paper on the
and to some of the ancillary activity     Minister, Malcolm Chisholm, after          operation of the SHIF.
that many housing associations carry      discussion with CoSLA, SFHA and              Developments will be reported in
out, such as factoring and its            Communities Scotland. While funding        future editions of Scottish News.
relationship to charitable status.        will not transfer, a key aim for the


                                                                                                                               11
MEMBERS NEWS

   CIPFA IN SCOTLAND CENTENARY




                                             Past Chairs: Harry Nicoll, David Chynoweth, Caroline Gardner, Tom Carter, Bill Sutherland

Members in Scotland will by now be aware that 2006 marks the centenary
year of ‘the Scottish Branch’, the volunteer arm of the Institute in Scotland.
A range of events will be held              members. Undoubtedly, those                        The setting was the magnificent
throughout the year to celebrate this       original members would have been               House for an Art Lover in
landmark. Members will already              proud of the way the membership                Bellahouston Park. The venue was a
have received their centenary               and the Institute have grown in that           modern construction built from the
calendars which chart the growth of         time. Equally, they could only have            original early century designs by
CIPFA in Scotland through the years         been impressed by the centenary                Charles Rennie Mackintosh. The
against the background of public            dinner which launched the centenary            building’s growth from an original but
services in Scotland throughout this        celebrations and which saw some of             early classic design to a construction
period.                                     CIPFA’s ‘great and good’ and other             fit for the 21st century was for some,
   The Institute in Scotland                leading public service figures                 a personification of CIPFA in Scotland
commenced in 1906 with 22                   gathered in Glasgow.                           in its centenary year. In both spirit
                                                                                           and substance it provided the perfect
                                                                                           backdrop for the initial drinks
                                                                                           reception, dinner and networking.
                                                                                               A prerequisite of any birthday party
                                                                                           of course is a cake. This party was no
                                                                                           different with the cake being cut
                                                                                           jointly by Sandra Black, Chair of
                                                                                           CIPFA in Scotland Executive
                                                                                           Committee and Allan Brackin, one of
                                                                                           CIPFA’s most senior members in
                                                                                           Scotland.

                                                                                           You can read more about CIPFA in
                                                                                           Scotland’s centenary plans at
               Sandra Black, Irene Silvester, Tom Scholes, Angela Scott and Alan Geddes    www.cipfa.org.uk/regions/scotland


                                                                                                                                         12
MEMBERS NEWS

THE TOM
SOWERBY
AWARD 2006
CIPFA is now inviting nominations
for the Tom Sowerby Award 2006.
This award honours those who
have given outstanding service to
CIPFA students, and will be             THE CIPFA LEARNING CENTRE
presented at the National Student
Forum Conference.
                                        AN UPDATE
   If you have a colleague, tutor or
mentor in Scotland who has             The CIPFA Learning Centre (CLC) was      the site which you will find by clicking
shown particular dedication to         launched in June 2005 to provide         on the Overview button in the “Get
CIPFA students, why not                CIPFA members with tools to support      Started” section of the left hand
recognise that dedication by           them in their everyday tasks, to         menu. To help you find your way
nominating him/her?                    improve their technical, management      round the CLC, you’ll find a
   To make a nomination for the        and leadership performance and to        Knowledge Base toolbar on the Home
Tom Sowerby Award 2006, go to          organise and record their Continuing     Page. As well as a standard Search
the dedicated website at               Professional Development (CPD). The      button, there are also advanced
www.cipfa.org.uk/students/curren       main features of the CLC are an          search options available and an
t/sowerby.cfm (If you don’t have       online management and leadership         Explore button, which allows you to
internet access you can phone          toolkit, a comprehensive database of     find your own way through the
Maria Locke at CIPFA on 020 7543       authoritative finance advice and a       Management and Leadership toolkit
5639 for a print copy of the           sophisticated learning and               and the database of technical finance
nomination form). The deadline         development system, which assists        and accounting material. You could
for nominations is Friday 17           users in assessing their performance,    try using these facilities to find the
March 2006.                            identifying their learning needs,        tips on preparing for a performance
                                       producing their development plan and     review meeting.
                                       reviewing its effectiveness.                For further information about the
                                          For those new to the CLC, CIPFA       CPD scheme please visit the CIPFA
DIARY DATES                            recommends you get started by
                                       reading through the introduction to
                                                                                Learning Centre at
                                                                                http://learning.cipfa.org.uk

Members AGM
18th May, 5.30pm
Parish Halls, Glasgow
                                       CETC EAST SCOTLAND
Graduation Ceremony
                                       STUDENTS EXAM RESULTS
19th May                               Students at the CIPFA Education and Training Centre (CETC) in Edinburgh are
City Chambers, Glasgow                 once again celebrating fantastic results in the recent Professional Accountancy
                                       Qualification exams. The Financial Accounting / Management Accounting group
Members will be notified               achieved a 100% pass rate for both modules and the Audit & Assurance /
in full later.                         Accounting for Decision Making group students had pass rates of 86% and 71%
                                       for each module respectively.



                                                                                                                           13
CAREER
In this edition of CIPFA Scottish News, we welcome Change CRS, a new partner organisation for
CIPFA. In the first of a series of regular career and recruitment articles, Julia Coltart, Managing
Consultant in the Public Sector Finance Division, discusses the positive prospects for talented
finance professionals balanced against the need for professional career advice




EMPLOYMENT IN
SCOTLAND 2006
“With the Scottish economy outperforming the rest of the UK in 2005,
the demand for talented professionals has never been greater.”
                                  According to a recent HBOS survey,       of the border” to fulfil career
                                  the 2005 labour market north of the      expectations.
                                  border was the strongest in the UK.         These inevitable skills gaps (as
                                  This striking economic growth has        opposed to skills shortages) must
                                  created a vibrant labour market. It is   make us take every opportunity for
                                  forecasted that in 2006 services,        ongoing training and CPD to ensure
                                  within both the private and public       that we can further increase our
                                  sectors, will continue to expand         marketability. This current situation

                                    Many of the current economic factors create the ideal
                                    environment for the individual to progress their career
                                    in the direction that they want.

                                  leading to a steady increase in          also lends itself to the highly
                                  professional and managerial jobs.        employable individual being able to
                                     Within the labour market the          make lifestyle choices when planning
                                  demand for skills is huge, with          their careers. That is, “right careers”,
                                  employers facing many recruitment        in terms of our motivating factors will
                                  difficulties. High employment and an     ensure that we fulfil all personal and
                                  ageing population will mean that         career goals. Organisations, in
                                  those seeking fresh opportunities        seeking potential employees, will
                                  with strong skill sets and experience    have to offer flexibility to assure that
                                  will be in an enviable position. No      this is achieved.
                                  longer, is there the need to go “south      This shortage will also increasingly



                                                                                                                      14
CAREER



force employers to look within the        become overwhelming. Professional
organisation for future potential         information and support has never
senior management. However, it
must be the responsibility of the
                                          been so invaluable as well as a fresh
                                          and unbiased perspective.
                                                                                    Current
individual to plan his or her career
and with all of the above in mind be
                                             At Change CRS we offer a total
                                          recruitment package. fulfilling
                                                                                    vacancies
honest with themselves as to their
motivators. What they enjoy about
                                          expectations for both employers and
                                          employees. These can only be
                                                                                    on offer:
their current role will not necessarily   achieved from a comprehensive             FINANCIAL
correspond if they were to make the       understanding of an individual’s
“natural progression” to a more           needs. Not only salary expectations,
                                                                                    ACCOUNTANT
                                                                                    3 mth Contract
senior/strategic role. Employers          but also other motivators must be
                                                                                    c£28 p/hr – Edinburgh
equally, must have guidelines for         taken into account. At Change we
what is in fact individual potential.     take a long term perspective and have
That being, benchmarks for a high         contact with candidates throughout        SENIOR INTERNAL
achiever in a current role, do not        their careers, not only in pursuit of     AUDIT
necessarily equate to the required        new roles, but also in offering general   Temp-Perm role
quotients to have continued career        career advice and helping to set short    c£20 p/hr – Dundee
success at senior management level.       and long term career goals.
Genuine potential and goals both in          As either an employer or individual    MANAGEMENT
lifestyle and role must be honestly       seeking recruitment advice, we would
                                                                                    ACCOUNTANT
analysed by both.                         be delighted to discuss the services
                                                                                    3 mth Contract
   Many of the current economic           that we, at Change can provide.
                                                                                    £15 p/hr – Edinburgh
factors create the ideal environment         Within the dedicated Public Sector
for the individual to progress their      Finance Division we are able to offer a
career in the direction that they want.   bespoke service throughout Scotland
                                                                                    INTERNAL AUDITOR
                                                                                    6mth Contract
However with the wealth of                at all levels from junior accountant to
                                                                                    £20 p/hr - Edinburgh
information regarding career              Financial Director level.
planning and opportunities, it can all
                                                                                    www.changejobs.net

                                                                                    In the first instance please

 Career Moves                                                                       contact:
                                                                                    Julia Coltart
                                                                                    Managing Consultant, Public
 Susan Cooper has been appointed to the new post of City                            Sector – Finance Division
 Chamberlain at Aberdeen City Council.                                              Change CRS
                                                                                    18 George Street
                                                                                    Edinburgh EH2 2PF
 Gordon Edwards has been appointed as Director of Corporate
                                                                                    julia.coltart@change jobs.net
 Services at Aberdeen City Council. Gordon is a former Chair of                     Telephone
 the CIPFA Directors of Finance Section.                                            0131 473 4937




                                                                                                                    15