"And That Finances Are Managed with Responsible Stewardship"
FOREST OF DEAN DISTRICT COUNCIL STATEMENT OF ACCOUNTS 2005/2006 CONTENTS Welcome to the Statement of Accounts Statement of Responsibilities Statement on Internal Control Explanatory Foreword Auditors' Report Statement of Accounting Policies Consolidated Revenue Account Notes to the Consolidated Revenue Account Consolidated Balance Sheet Notes to the Consolidated Balance Sheet Statement of Total Movements in Reserves Notes to the Statement of Total Movements in Reserves Cashflow Statement Notes to the Cashflow Statement Collection Fund Notes to the Collection Fund Glossary of Financial Terms RICT COUNCIL UNTS 2005/2006 CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE CLICK HERE WELCOME TO THE STATEMENT OF ACCOUNTS 2005/06 This was a very challenging year for the Council but we started it by maintaining our promise to keep Cou increases as low as possible, our increase being only 3 per cent. To do this, meet increased pension costs and put £229,000 into the Council's priority services meant we look hard to find efficiencies and savings totalling £410,000. By the end of the year we had managed our finances well and were able to put an extra £168,000 into ou The purpose of these accounts is to give clear information on the cost of services in 2005/06, how they w for and the value of the Councils assets and liabilities at the 31st March. The explanatory foreword on page 13 aims to give you a simple picture of the numbers behind the forma accounts. If you would like any help with understanding the figures please contact the accountancy team Accountancy Services, Council Offices, Coleford, GL16 8HG, telephone 01594 812544 or e-mail 2005/06 aining our promise to keep Council Tax il's priority services meant we had to o put an extra £168,000 into our ervices in 2005/06, how they were paid he numbers behind the formal contact the accountancy team at 1594 812544 or e-mail Return to Contents STATEMENT OF RESPONSIBILITIES FOR THE STATEMENT OF ACCOUNTS THE COUNCIL'S RESPONSIBILITIES The Council is required to: - make arrangements for the proper administration of its financial affairs and to ensure that o officers has the responsibility for the administration of those affairs. In this authority, the Depu Executive, who also undertakes the role of Chief Finance Officer, has that responsibility - manage its affairs to secure economic, efficient and effective use of resources and safeguard it - approve the Statement of Accounts THE CHIEF FINANCE OFFICER'S RESPONSIBILITIES The Deputy Chief Executive is responsible for the preparation of the Council's Statement of Acc accordance with proper practices as set out in the CIPFA/LASAAC Code of Practice on Local Authority In preparing this statement of accounts, the Deputy Chief Executive has: - selected suitable accounting policies and then applied them consistently; - made judgments and estimates that were reasonable and prudent; and - complied with the Code of Practice. The Deputy Chief Executive has also: - kept proper accounting records which were up to date; and - taken reasonable steps for the prevention and detection of fraud and other irregularities CERTIFICATE OF DEPUTY CHIEF EXECUTIVE I certify that the Statement of Accounts on pages 19 to 50 present fairly the financial position of the C the accounting date and its income and expenditure for the year ended 31 March 2006. Deputy Chief Executive Date COMMITTEE APPROVAL OF THE STATEMENT OF ACCOUNTS This statement of accounts was approved by the Executive Committee of the Council at its meeting on 29 Chairman Date MENT OF ACCOUNTS Return to Contents l affairs and to ensure that one of its airs. In this authority, the Deputy Chief has that responsibility of resources and safeguard its assets Council's Statement of Accounts in f Practice on Local Authority and other irregularities the financial position of the Council at March 2006. OF ACCOUNTS he Council at its meeting on 29th June Return to Contents STATEMENT ON INTERNAL CONTROL 1. SCOPE OF RESPONSIBILITY 1.1 The Forest of Dean District Council (“the Council”) is responsible for ensuring that its b accordance with the law and proper standards, and that public money is safeguarded and pr used economically, efficiently and effectively. The Council also has a duty under the Local make arrangements to secure continuous improvement in the way in which its functions are exe combination of economy, efficiency and effectiveness. 1.2 In discharging this overall responsibility, the Council is also responsible for ensuring that th internal control which facilitates the effective exercise of the Council‟s functions and which inclu management of risk. 2. THE PURPOSE OF THE SYSTEM OF INTERNAL CONTROL 2.1 The system of internal control is designed to manage risk to a reasonable level rather than to to achieve policies, aims and objectives; it can, therefore, only provide reasonable and n effectiveness. 2.2 The system of internal control is based on an ongoing process designed to identify and achievement of the Council‟s policies, aims and objectives, to evaluate the likelihood of those the impact should they be realised, and to manage them efficiently, effectively and economically 2.3 The system of internal control has been in place at the Council for the year ended 31st March 2 approval of the Statement of Accounts. 3. THE INTERNAL CONTROL ENVIRONMENT The key elements of the Council‟s internal control environment are described below: 3.1 Achievement of the Authority’s Objectives 3.1.1 The Council‟s aims are set out in the Council‟s Corporate Plan, which clearly sets out the Counc and the detailed objectives under each of these. 3.1.2 The Corporate Plan is the key strategy document – from which a number of plans are develop include the Medium Term Financial Plan and the Housing, Economic Development, Tourism an 3.1.3 Both Corporate Management Team and Executive Committee monitor performance quarterly ag objectives and actions. 3.1.4 In addition, there is a Local Strategic Partnership (LSP) within the Forest of Dean area that ha Plan, which is based on wide consultation with the community. Representatives from the volu have worked with councillors from Forest of Dean District Council, Gloucestershire County Cou Councils in putting together a plan that will „make the Forest of Dean an even better place to live 3.2 Policy and Decision-Making 3.2.1 The Council has a formally published Constitution, which incorporates the Scheme of Del decision-making arrangements and responsibilities of the Authority. There are clear rules of pr council meetings and details of delegated authorities to individuals. There is also a robust bud and detailed financial regulations, which are monitored by the Deputy Chief Executive and th constitution is updated continually by the Constitution Working Group to reflect any changes in s 3.2.2 During the year the council changed its old scrutiny arrangements with the formation of two Corporate and Community. Both Committees can be consulted on decisions or the deve Executive Committee and can also “call-in” certain categories of decisions made by them. M are open to the public except where personal or confidential matters are being disclosed. 3.2.3 A number of standing groups have been created under these scrutiny committees. An Audit G ensure our governance procedures are robustly challenged. There are separate groups con value for money 3.2.4 The Constitution also details a scheme of delegation to officers in respect of the day-to-day op from Council policy and decisions, and other proper functions. 3.2.5 All reports are reviewed for legal and financial considerations prior to being presented to Me formal decision-making. 3.3 Compliance with Established Policies, Procedures, Laws and Regulations 3.3.1 The council has a Standards Committee whose roles and functions include: · promoting and maintaining high standards of conduct; · advising and training Members on the Council's Code of Conduct; · monitoring the implementation of the Code of Conduct; · receiving complaints referred to the Authority from the Standards Board for England; and · dealing with any issues raised by the Monitoring Officer. 3.3.2 The Council recognises the importance of the principles of Corporate Governance and the nee areas of the Authority‟s corporate activities. 3.3.3 The Deputy Chief Executive and Monitoring Officer have specified roles within the Cons prepared for member decision comply with the budget and policy framework. The Head of Fin both Executive and Scrutiny Committees and regularly reports to Members on the internal audit 3.3.4 Internal and external auditors work together to review and provide annual opinions of the contr and validity of the annual accounts. The Council is also subject to various other inspections, Commission and the Benefit Fraud Inspectorate. 3.3.5 Each Member receives copies of meeting agendas. Members are required to declare any inte meeting. In addition, Members are encouraged to undertake any training relevant to the area of they are involved. 3.3.6 The corporate and service planning process ensures policies, objectives and plans for th communicated to all staff. Standards and guidance, such as Financial Procedure Rules and C have been developed and are available on the Council‟s intranet to ensure officers and membe and responsibilities. 3.3.7 Policies and strategies such as the Anti-Fraud and Corruption Strategy and the Whistleblow enable Members and officers to raise any concerns. Any necessary investigations are timely, c 3.4 The Corporate Risk Management 3.4.1 A risk management process is in place that ensures strategic and operational risks are iden Executive Committee leads on the strategic risk process whilst the Corporate Management T risk management is embedded across the Council‟s organisation and staff have been adequat through the service planning process. Responsibilities for risk management, including monitor established in the Council‟s Risk Management Framework and Guidance. 3.4.2 The strategic risks that have been identified have been prioritised and a full Risk Register has risks identified have been assigned to a Head of Service, who is responsible for developing an control the risk. 3.4.3 As part of the annual service planning process, Heads of Service are required to identify the their services and to prepare an appropriate action plan to mitigate these risks 3.5 Economic, Effective and Efficient use of Resources, and Securing Continuous Improvem 3.5.1 The Council has a responsibility to ensure the economic, effective and efficient use of res continuous improvement in the way in which its functions are exercised, as required by the Best 3.5.2 In addition to the requirements of Best Value, the Council is now required to comply with Government‟s Efficiency Review programme and to achieve a target of 2.5% efficiency gains fo starting 2005/06. 3.5.3 The Council is now placing greater emphasis on delivering and demonstrating value for mo programme of reviews are to be implemented over the next five years to streamline se requirements of Best Value, value for money and the achievement of government efficiency targ 3.5.4 As part of the Best Value Performance Plan (BVPP), the Council reports its performa Performance Indicators (PI). Some of these are nationally set as Best Value Performance In been set locally. The Council sets three year targets for each PI. The purpose of these ind Council‟s performance and progress over time, with a view to promoting continuous improveme 3.6 Performance Management 3.6.1 The Council‟s Performance Management Framework and Guidance details the systems and major elements of the system of internal control for performance management. The system inc · A Corporate Plan which clearly sets out corporate objectives. · Performance Indicators and targets across the organisation that cascade down fro Service Plans and individual officer‟s work plans. · A service planning process that ensures service delivery objectives and targets (linke are achieved, service quality standards attained and sufficient resources are available · A staff appraisal process (Personal Development Appraisal – PDA) that ensur objectives are communicated to all staff and linked to individual work plans and targe ensures staff receive appropriate training and development to enable them to un · changing working environment. Regular monitoring of performance by Executive Committee, Scrutiny Committees and 3.7 Financial Management 3.7.1 The Council‟s overall financial arrangements are governed by its Medium Term Financial financial framework for the delivery of the Council‟s strategies and plans. In determining the rev framework, a number of factors are taken into account including the national context, the distrib funding from central government along with other local and external funding sources. 3.7.2 This is supported by robust budget setting and monitoring arrangements and detailed financi part of the Constitution. 3.7.3 This year the Council has introduced a detailed service planning process that will in future fe procedure. Heads of Service are required to prepare Service Plans on an annual basis. This year the Council has introduced a detailed service planning process that will in future fe procedure. Heads of Service are required to prepare Service Plans on an annual basis. 3.7.4 The Council manages its investments within the guidelines of its Treasury Management Poli Treasury Management Strategy, which have been approved by Members. 3.7.5 The Council maintains an internal audit function which operates to the standards set out in Internal Audit in Local Government in the UK‟. 3.7.6 The Council has an objective and professional relationship with external auditors and statutory by the Annual Audit and Inspection Letter. 4. REVIEW OF EFFECTIVENESS 4.1 The Council has responsibility for conducting, at least annually, a review of the effectiveness control. This is informed by the work of the Internal Auditors and the Corporate Management who have responsibility for the development and maintenance of the internal control environme made by the External Auditors and other review agencies and inspectorates 4.2 The key processes in maintaining and reviewing the effectiveness of the system of internal con described below: 4.3 The Authority 4.3.1 The key formal document governing the internal control framework for the Authority is its Con decision-making is made in accordance with the requirements of the Constitution and the Sch forms part of the Constitution. 4.3.2 The Head of Legal and Democratic Services (the Monitoring Officer) has a duty to continuous operation of the Constitution to ensure its aims and principles are given full effect. A review carried out in 2005 and a revised Constitution adopted by Council in October 2005. 4.3.3 The Standards Board for England did not issue any reports in 2005/2006 in respect of an Council. No maladministration reports were received from the Local Government Ombudsman. 4.4 Comprehensive Performance Assessment (CPA) 4.4.1 The Audit Commission‟s Comprehensive Performance Assessment in October 2004 judged th and for the majority of the areas reviewed weaknesses outweighed strengths. 4.4.2 In December 2005 the Audit Commission issued a Progress Assessment Report on the cou CPA improvement plan. This was very positive stating „the Council is putting the right building its management, governance and overall capacity‟. It identified that the council has made addressing identified weaknesses and that the level of public satisfaction is improving and i average. However, the Council is only at the start of an ambitious process of change and embedding key issues such as Performance Management. In December 2005 the Audit Commission issued a Progress Assessment Report on the cou CPA improvement plan. This was very positive stating „the Council is putting the right building its management, governance and overall capacity‟. It identified that the council has made addressing identified weaknesses and that the level of public satisfaction is improving and i average. However, the Council is only at the start of an ambitious process of change and embedding key issues such as Performance Management. 4.4.3 In March 2006 the Council received its annual Use of Resources judgement from the highlighted a number of financial management and internal control issues which resulted in t level 1, “inadequate performance below minimum requirements”. Financial Reporting and Fin rated level 2 with Financial Standing, Internal Control and Value for Money scoring level 1. developed to improve the areas of weakness identified, this was presented to the Executive Co 2006 and approved for delivery by March 2007. 4.5 Risk Management 4.5.1 The Council has a clear framework for managing risk and all Heads of Service have an unders be applied to their own service area. As part of the annual service planning process they operational risks and ensure an appropriate action is taken. Progress on actions to manage s was reported to the Executive Committee on 17th November 2005. Operational risk registers Service at six monthly intervals. 4.5.2 Risks relating to the Council's Corporate Plan objective have been identified and a Strategic These have been assigned to Heads of Service who are responsible for developing an actio Progress in risk management action plans and amendments to the key strategic risks were Committee on the 12th May 2005 and 17th November 2005. The risk management action March 2007. 4.6 Performance 4.6.1 A new format for quarterly reporting to members and Corporate Management Team was de takes a holistic view of “our journey of improvement” and includes finance, staff complaints/compliments as well as performance data. The Corporate Scrutiny Committee h Group to develop high-level indicators for corporate priorities. 4.6.2 During the year the Council acquired the Covalent performance monitoring system. This performance indicators, risks, audit recommendations and key actions in the Community, Corpo 4.6.3 A Project Board, consisting of senior officers and Members monitors progress on the Council's I 4.6.4 During 2005/06 the Council carried out a best value review of its I.T. function and emplo Business Process Re-engineering techniques in a review of Planning. The results of this w implemented in 2006/07. 4.7 Internal Audit 4.7.1 The role of internal audit is to review the internal control framework that governs the operations doing, provide an independent opinion to both Corporate Management Team and Member robustness of the Council‟s control environment. 4.7.2 The Internal Audit function of the Council is delivered by contractors Deloitte & Touche Public the Head of Finance. Their work complies fully with the requirements of CIPFA‟s Code of P Deloitte & Touche produced a strategic five-year risk based Audit plan that is updated each senior management of the Council. Internal audit activity during the year is governed by the was 100% delivered during 2005/06. Of the 37 systems audited 20 received a limited level o risk area (car parks), received no assurance. 4.7.3 The work of internal audit is subject to regular inspection by the Council‟s external auditors wh can continue to place reliance on their work. 4.7.4 An exercise was undertaken during the year to remove a number of out of date or repeated This action was authorised by the Council's Section 151 Officer and the Council's Sector Touche. The remaining recommendations remain subject to the normal follow up procedures w 4.7.5 Internal audit have identified two areas of significant internal control weakness, relating to cont management. Both these matters are addressed in the actions outlined in section five. 4.7.6 Internal audit also made 14 priority one recommendations (those that are fundamental to the action should be taken immediately) during 2005/06. The work areas concerned were: · Risk Management (5); · Procurement and Contract Management (2); · Street Cleaning Contract (1); · Car Parks (2); · Cemeteries (1); · Corporate Health and Safety (1); · VAT (1); and · Sickness and Absence Management (1). These will be addressed during 2006/2007 and will be subject to monitoring and review as part 4.7.7 The Council's Head of Internal Audit is required to give an opinion as to the overall adequacy Council‟s internal control environment, based on the internal audit work undertaken, review of arrangements and the work of other assurance providers. His opinion is that the internal co operating systems operating throughout the year require strengthening before they can be sound. This report in respect of 2005/2006 was presented to the Corporate Scrutiny Audit G 2006. 4.8 Annual Review 4.8.1 In addition to the above, the Council has conducted a formal review of its internal control evidence and assurance from a variety of sources. This has included the collation of as Management Team on the effectiveness of the internal control environment. 4.8.2 The Executive Committee and the Corporate Management Team consider Audit Commission re Corporate Scrutiny Audit Group have also been reviewing reports prior to Executive Committee 5. SIGNIFICANT INTERNAL CONTROL ISSUES 5.1 We have been advised on the implications of the result of the review of the effectiveness of the operated by the Council and the actions to be taken in 2006/07 to enhance control arran Scrutiny Audit Group, reporting to Executive Committee, will oversee implementation of the a progress is maintained in achieving continuous improvement of the system. 5.2 The Council has assessed its systems and procedures and has identified that in most cases already in place. However, improvements have been identified that will enhance the internal following actions outline the issues that are considered to be significant and the measures th the weaknesses. A summarised action plan is given at the end of the statement. 5.3 Business Continuity 5.3.1 Good progress has been made in 2005/06 to improve our business continuity procedures, ho remains outstanding to be completed in 2006/07. 5.3.2 Action Required: · Walk through testing of the Business Continuity Plan · Training for managers · Regularise meetings of the Crisis Management Team 5.4 Performance Management 5.4.1 The CPA Progress Assessment Report notes that the Council needs to do further work to embe 5.4.2 Action Required: · Establish a 'cascade' system of monthly performance meetings · Roll out of Covalent performance monitoring system to staff and Members 5.5 Procurement and Contracts 5.5.1 Work by Internal Audit and the Audit Commission have highlighted weaknesses in the C tendering and awarding of contracts. The authority needs to identify the appropriate resou forward. The key actions necessary are: 5.5.2 Action Required: · Issue revised guidelines and provide training for staff · Identify appropriate resources to take procurement forward · Maintain a central Contracts Register 5.6 Production of the Statement on Internal Control 5.6.1 In 2004/05 the Audit Commission commented that improvements were necessary to enhance o compiling the Statement on Internal Control. Some work remains outstanding. 5.6.2 Action Required: · Training for the Corporate Scrutiny Audit Group to enable it to fulfil its role · Officer working group to fully populate the 'SICNOTE' software · Progress monitoring by Corporate Scrutiny Audit Group 5.7 Audit Resources 5.7.1 A review of internal audit by the Audit Commission has highlighted a lack of internal audit r structure following the management reorganisation in May 2005. 5.7.2 Action Required: · Create and fill Audit Manager post 5.8 Internal Audit Recommendations 5.8.1 Both the Audit Commission and Internal Audit have expressed concerns over the dela recommendations. 5.8.2 Action Required: · Use of Covalent system to track all priority 1 and 2 recommendations · Enhanced reporting of recommendations to the Corporate Scrutiny Audit Gro 5.9 Use of Resources 5.9.1 The evaluation by the Audit Commission was that the Council was 'below minimum requiremen 5.9.2 Action Required: · Implement the Action Plan approved by Executive Committee · Progress monitoring by Corporate Scrutiny Audit Group 5.10 Risk Management 5.10.1 Although the Council has a framework for managing risk and risk registers in place, fur management becomes fully embedded throughout the organisation has been scheduled for 200 5.10.2 Action Required: · Review all existing risk management documentation · Incorporate risk management into the Council's performance management s · Update the strategic risk register to ensure these risks are regularly reviewed · Risk management training programme for all Officers, Members and Key Pa · Produce a risk management strategy detailing the roles and responsibility of · Review key partnership arrangements to ensure risk identification and m covered · Ongoing monitoring by Corporate Scrutiny Audit Group Signed: ……………………………………………………… Dated: ……………………….. (Chief Executive) Signed: ……………………………………………………… Dated: ……………………….. (Leader of the Council) Summary of Actions Ref. Control Weakness Action 1 Performance Management not 1.1 Covalent monitoring software - embedded completion of rollout and training to 1.2 Monthly performance meetings 2 Business Continuity 2.1 Simulated exercise to test procedures 2.2 Establish quarterly meetings of Crisis Management Group 2.3 Training for managers 3 Risk Management 3.1 Implementation of action plan 3.2 Monitoring by the Corporate Scrutiny Audit Group 4 Procurement 4.1 Contract management training for staff and revised guidelines 4.2 Maintain central contracts register 4.3 Identify appropriate resources to take procurement forward 5 Use of Resources score 5.1 Implementation of action plan to improve score 5.2 Monitoring by the Corporate Scrutiny Audit Group 6 Timely implementation of internal 6.1 Covalent monitoring software - audit recommendations completion of rollout and training to 6.2 staff Monitoring by the Corporate Scrutiny Audit Group 7 Insufficient internal audit resources 7.1 New Audit Manager post to be filled 8 Production of the Statement on 8.1 Corporate Scrutiny Audit Group Internal Control training 8.2 Officer Working Group to populate 'SICNOTE' assurance software 8.3 Monitoring by the Corporate Scrutiny Audit Group RNAL CONTROL Return to Contents responsible for ensuring that its business is conducted in public money is safeguarded and properly accounted for, and cil also has a duty under the Local Government Act 1999 to the way in which its functions are exercised, having regard to a lso responsible for ensuring that there is a sound system of e Council‟s functions and which includes arrangements for the to a reasonable level rather than to eliminate all risk of failure re, only provide reasonable and not absolute assurance of process designed to identify and prioritise the risks to the s, to evaluate the likelihood of those risks being realised and ficiently, effectively and economically. uncil for the year ended 31st March 2006 and up to the date of ment are described below: Plan, which clearly sets out the Council's aim and key priorities which a number of plans are developed in support of it. These Economic Development, Tourism and Capital Strategies. tee monitor performance quarterly against the agreed thin the Forest of Dean area that has developed a Community munity. Representatives from the voluntary and private sectors Council, Gloucestershire County Council and Town and Parish st of Dean an even better place to live, work and visit‟. ch incorporates the Scheme of Delegation and sets out the Authority. There are clear rules of procedure for the running of dividuals. There is also a robust budget and policy framework y the Deputy Chief Executive and the Monitoring Officer. The king Group to reflect any changes in structure. ngements with the formation of two new scrutiny committees, onsulted on decisions or the development of policy by the ories of decisions made by them. Meetings of all committees al matters are being disclosed. ese scrutiny committees. An Audit Group has been created to ed. There are separate groups considering performance and ficers in respect of the day-to-day operational activities arising ns. tions prior to being presented to Members of the Council for ws and Regulations Return to Contents unctions include: Conduct; andards Board for England; and Corporate Governance and the need to apply them across all ve specified roles within the Constitution to ensure reports d policy framework. The Head of Finance has direct access to orts to Members on the internal audit function. provide annual opinions of the control framework, governance subject to various other inspections, for example by the Audit bers are required to declare any interests at the outset of the ke any training relevant to the area of decision-making in which olicies, objectives and plans for the Council‟s activities are as Financial Procedure Rules and Contract Procedure Rules, tranet to ensure officers and members are aware of their roles ption Strategy and the Whistleblowers‟ Policy are in place to necessary investigations are timely, complete and effective. tegic and operational risks are identified and managed. The whilst the Corporate Management Team ensures operational isation and staff have been adequately trained to manage risk risk management, including monitoring and review are clearly and Guidance. oritised and a full Risk Register has been developed. The key who is responsible for developing an appropriate action plan to Service are required to identify the operational risks affecting mitigate these risks nd Securing Continuous Improvement Return to Contents c, effective and efficient use of resources, and for securing re exercised, as required by the Best Value duty. ncil is now required to comply with the requirements of the ve a target of 2.5% efficiency gains for each of the three years, ng and demonstrating value for money in service delivery. A e next five years to streamline service delivery, satisfy the vement of government efficiency targets. the Council reports its performance against a variety of y set as Best Value Performance Indicators and others have each PI. The purpose of these indicators is to measure the to promoting continuous improvement. Guidance details the systems and procedures that form the mance management. The system includes the following: e objectives. organisation that cascade down from the Corporate Plan to delivery objectives and targets (linked to corporate objectives) and sufficient resources are available. ment Appraisal – PDA) that ensures Council priorities and ed to individual work plans and targets. The PDA process also development to enable them to undertake their duties in a Committee, Scrutiny Committees and Corporate Management ned by its Medium Term Financial Plan, which sets out the ies and plans. In determining the revenue and capital financial uding the national context, the distribution of local government external funding sources. g arrangements and detailed financial regulations, which form lanning process that will in future feed into the budget setting ce Plans on an annual basis. lanning process that will in future feed into the budget setting ce Plans on an annual basis. es of its Treasury Management Policy Statement and Annual d by Members. perates to the standards set out in the „Code of Practice for p with external auditors and statutory inspectors, as evidenced Return to nually, a review of the effectiveness of the system of internal Contents ors and the Corporate Management Team within the authority nce of the internal control environment, and also by comments and inspectorates iveness of the system of internal control during 2005/2006 are amework for the Authority is its Constitution. All delegation of ents of the Constitution and the Scheme of Delegation, which ng Officer) has a duty to continuously monitor and review the ciples are given full effect. A review of the Constitution was Council in October 2005. ports in 2005/2006 in respect of any elected member of the the Local Government Ombudsman. sessment in October 2004 judged that the Council was „weak‟ weighed strengths. ess Assessment Report on the council‟s progress against its e Council is putting the right building blocks in place to improve dentified that the council has made reasonable progress in ublic satisfaction is improving and is now above the national n ambitious process of change and this will depend on fully ess Assessment Report on the council‟s progress against its e Council is putting the right building blocks in place to improve dentified that the council has made reasonable progress in ublic satisfaction is improving and is now above the national n ambitious process of change and this will depend on fully of Resources judgement from the Audit Commission. This al control issues which resulted in the council being rated as ments”. Financial Reporting and Financial Management were d Value for Money scoring level 1. An action plan has been s was presented to the Executive Committee on the 25th May all Heads of Service have an understanding of how this should nnual service planning process they are expected to identify n. Progress on actions to manage significant operational risks ber 2005. Operational risk registers are reviewed by Heads of ave been identified and a Strategic Risk Register developed. responsible for developing an action plan to combat the risk. ents to the key strategic risks were reported to the Executive 005. The risk management action plan will be completed by orporate Management Team was developed in 2005/06. This ent” and includes finance, staffing and sickness data, he Corporate Scrutiny Committee has set up a Performance es. rformance monitoring system. This will be used to monitor key actions in the Community, Corporate and Service plans. monitors progress on the Council's Improvement Plan. view of its I.T. function and employed consultants to apply w of Planning. The results of this work will be reported and Return to Contents Return to Contents amework that governs the operations of the Council and, in so e Management Team and Members of the Authority on the contractors Deloitte & Touche Public Sector and managed by requirements of CIPFA‟s Code of Practice for Internal Audit. sed Audit plan that is updated each year in consultation with during the year is governed by the annual audit plan, which audited 20 received a limited level of assurance and one, low by the Council‟s external auditors who have reported that they a number of out of date or repeated audit recommendations. 1 Officer and the Council's Sector Manager from Deloitte & to the normal follow up procedures with Deloitte & Touche. nal control weakness, relating to contract procurement and risk tions outlined in section five. s (those that are fundamental to the Council and upon which work areas concerned were: t (2); ). ect to monitoring and review as part of the normal audit n opinion as to the overall adequacy and effectiveness of the nal audit work undertaken, review of the Council‟s governance . His opinion is that the internal controls within financial and strengthening before they can be considered fundamentally d to the Corporate Scrutiny Audit Group Group on 26th June ormal review of its internal control environment and collated s has included the collation of assurances from Corporate ntrol environment. Team consider Audit Commission reports. Since February the reports prior to Executive Committee meetings. Return to Contents the review of the effectiveness of the system of internal control 2006/07 to enhance control arrangements. The Corporate will oversee implementation of the action plan to ensure that nt of the system. nd has identified that in most cases robust arrangements are ntified that will enhance the internal control environment. The be significant and the measures that are planned to address end of the statement. r business continuity procedures, however the following work ontinuity Plan gement Team ncil needs to do further work to embed performance performance meetings oring system to staff and Members e highlighted weaknesses in the Council's arrangements for ds to identify the appropriate resources to take procurement ining for staff rocurement forward ments were necessary to enhance our processes for emains outstanding. t Group to enable it to fulfil its role he 'SICNOTE' software iny Audit Group Return to Contents highlighted a lack of internal audit resources in the Council's 2005. expressed concerns over the delay in implementing audit ity 1 and 2 recommendations s to the Corporate Scrutiny Audit Group ncil was 'below minimum requirement - inadequate Executive Committee iny Audit Group isk and risk registers in place, further work to ensure risk anisation has been scheduled for 2006/07. cumentation ouncil's performance management software ure these risks are regularly reviewed or all Officers, Members and Key Partners etailing the roles and responsibility of staff and members to ensure risk identification and management is adequately ny Audit Group Dated: ……………………….. Dated: ……………………….. Return to Actions Contents Responsible Completion Action Officer by monitoring software - Deputy Chief 30th Sept 2006 of rollout and training to Executive rformance meetings Deputy Chief Ongoing exercise to test procedures Deputy Chief 30th Sept 2006 Executive uarterly meetings of Crisis Deputy Chief Ongoing nt Group Executive managers Deputy Chief 31st Dec 2006 Executive ation of action plan Head of Finance Ongoing by the Corporate Scrutiny Corporate Ongoing p Scrutiny Audit Group management training for Deputy Chief 30th Sept 2006 vised guidelines Executive entral contracts register Head of Finance 30th Sept 2006 propriate resources to take Deputy Chief 30th Sept 2006 nt forward Executive/Head ation of action plan to Deputy Chief Ongoing ore Executive/Head by the Corporate Scrutiny of Finance Corporate Ongoing p Scrutiny Audit monitoring software - Group Corporate Ongoing of rollout and training to Management by the Corporate Scrutiny Team Corporate Ongoing p Scrutiny Audit Manager post to be filled HeadGroup of Finance 30th Sept 2006 Scrutiny Audit Group Head of Finance Ongoing orking Group to populate Corporate Ongoing assurance software Management Team by the Corporate Scrutiny Corporate Ongoing p Scrutiny Audit Group Return to Contents EXPLANATORY FOREWORD 1. INTRODUCTION TO THE ACCOUNTS The Council's accounts for the financial year 2005/2006 are set out on pages 23 to 50, and consist of the (1) The Consolidated Revenue Account: this sets out income and expenditure for all of the Council's services and shows the amount fina and government grants; (2) The Consolidated Balance Sheet: which brings together all the assets and liabilities of the Council at the financial year-end; (3) The Statement of Total Movements in Reserves: reserves are amounts of money that have been set aside to cover future expenditure. This sta year between various categories of reserves; (4) The Cash Flow Statement: which summarises the inflows and outflows of cash arising from transactions with third p purposes; (5) The Collection Fund: this shows the income from council tax and business rate payers and how this is distributed to County Councils and Gloucestershire Police Authority. These accounts are supported by the Statement of Accounting Policies which follows this foreword and v 2. SUMMARY OF THE COUNCIL'S FINANCIAL POSITION The fixed assets of the Council are valued at £10,470,620, this figure being made up of £434,520 inta assets. Intangible assets are essentially purchased software. During the year we acquired an additional £372 £121,000 relating to a document imaging system and £133,000 in respect of a Customer Relationship Ma Movements on tangible assets included the acquisition of £207,000 worth of vehicles and equipment i worth of land and buildings, the sale of land at Grace's Pitch, Newent, for £152,000 and the transfer of to Forest of Dean Housing. Investments at 31st March totalled £24,910,000. Debt outstanding was £5,994,254, this relating to e years. In accordance with the adopted Treasury Management Strategy the debt was fully repaid on 19th movement in interest rates. Investments at 31st March totalled £24,910,000. Debt outstanding was £5,994,254, this relating to e years. In accordance with the adopted Treasury Management Strategy the debt was fully repaid on 19th movement in interest rates. The average rate of interest paid in 2005/06 was 4.59% (4.59% in 2004/05). Creditors and receipts in advance increased by £703,998 over the equivalent figure for 2004/05 of whi due to Gloucestershire County Council and Gloucestershire Police Authority in respect of surpluses on th Assets less liabilities of the Council, as shown on the Consolidated Balance Sheet (see page 31) tota £2,492,754 over 2004/2005. Of this decrease £2,511,000 relates to an increase in the deficit on the insufficient 'cash' reserves to cover this deficit but the actuarial review undertaken on 31st March employers contribution rates necessary to meet the deficit. Our medium term projections for the budg cost. The next actuarial review of the pension fund is due in March 2007. Reserves set aside for specific purposes were £5,547,075 at year end an increase of £1,579,682, of w transfering the former Housing Revenue Account balance out of the authority's General Fund to the Coun 3. COMPARISON OF BUDGET & OUTTURN Budgets Original £ Central Services to the Public 689,070 Cultural and Related Services 934,450 Environmental Services 3,181,950 Planning and Development Services 2,414,000 Highways, Roads and Transport Services 345,990 General Fund Housing 2,099,580 Corporate and Democratic Core 2,309,760 Non Distributed Costs - Total - All Services 11,974,800 Interest and Investment Income (1,196,650) Contribution to/(from) Revenue Reserves (118,120) Pension Adjustments - Transfer from Asset Management Revenue Account (70,630) Losses/Gains on repurchase of borrowing 4,400 Capital expenditure financed from revenue - Capital related reversals (1,362,760) West Gloucestershire I.D.B. & Other Levies 17,600 Net Revenue Expenditure 9,248,640 Parish/Town Council Precepts 1,106,120 10,354,760 Less: Revenue Support Grant (2,685,940) Redistributed NNDR (2,315,280) Demand on Collection Fund (5,336,990) (Increase)/Decrease in Working Balances 16,550 The underspend on all services of £541,798 includes pension accounting entries of £121,000. After adjusting for these, the Council was £662,798 underspent against revised budget. The Increased Housing Benefit Subsidy received Building On What's Special (BOWS) funding unspent Local Authority Business Growth Incentive Scheme income Local Strategic Partnership - second homes Transitional Social Housing Grant Increased Planning income received Planning Delivery Grant Shortfall in Building Control Fees Shortfall in income from Cemeteries Reduced Land Charges Income * These balances were transferred to earmarked reserves. 4. WHERE THE MONEY COMES FROM An analysis of the Council's gross revenue income (excluding internal recharges) in 2005/2006 is as follo £ 20,000,000 £ 18,000,000 £ 16,000,000 £ 14,000,000 £ 12,000,000 £ 10,000,000 £ 8,000,000 £ 6,000,000 £ 4,000,000 £ 2,000,000 £- Government Grants Business Rates Council Tax Revenue Support Grant Rents 5. WHAT THE MONEY IS SPENT ON An analysis of the Council's gross revenue expenditure (excluding internal recharges) in 2005/2006 is as £ 18,000,000 £ 16,000,000 £ 14,000,000 £ 12,000,000 £ 10,000,000 £ 8,000,000 £ 6,000,000 £ 4,000,000 £ 2,000,000 £- Employees Running Expenses Capital Financing 6. THE SERVICES PROVIDED The Council's net revenue expenditure of £11.297m for General Fund services for 2005/2006 is analysed The Council's net revenue expenditure of £11.297m for General Fund services for 2005/2006 is analysed £ 4,000,000 £ 3,500,000 £ 3,000,000 £ 2,500,000 £ 2,000,000 £ 1,500,000 £ 1,000,000 £ 500,000 £- Central Services Cultural and Environmental Planning and Highways, Roads to the Public Related Services Services Development and Transport Services Services 7. CAPITAL EXPENDITURE The Council's total spend on capital projects was £2,549,491 against a budget of £3,300,000. The m Social Housing Grant £553,422, Improvement and Renovation Grants £588,656 and expenditure on E-G The key variance was: £000 Reason Social Housing 611 Slippage on schemes with Housing Associations The chart below shows how the whole programme was spent: £ 1,200,000 £ 1,000,000 £ 800,000 £ 600,000 £ 400,000 £ 200,000 £- £- Economic Development Estate Management Housing E- The majority of the capital programme was funded from capital receipts, although 35p of every £1 spent c The chart below shows how the whole programme was funded. £ 900,000 £ 800,000 £ 700,000 £ 600,000 £ 500,000 £ 400,000 £ 300,000 £ 200,000 £ 100,000 £- Sale of Assets Borrowing Capital Grants 8. FURTHER INFORMATION Further information about the accounts is available from Accountancy Services, Council Offices, C Council's policy of providing full information about its affairs. In addition, interested members of the public the accounts before the audit is completed. The availability of the accounts for inspection is advertised in FOREWORD Return to Contents pages 23 to 50, and consist of the following: ervices and shows the amount financed from council tax payers ncil at the financial year-end; cover future expenditure. This statement details movements in the ng from transactions with third parties for revenue and capital yers and how this is distributed to the Government, the District and s which follows this foreword and various notes to the accounts. e being made up of £434,520 intangible and £10,036,100 tangible r we acquired an additional £372,550 of software which included pect of a Customer Relationship Management system. worth of vehicles and equipment in the year, the sale of £101,000 , for £152,000 and the transfer of land at Broadwell worth £60,000 was £5,994,254, this relating to expenditure incurred in previous y the debt was fully repaid on 19th April 2006 following a favourable was £5,994,254, this relating to expenditure incurred in previous y the debt was fully repaid on 19th April 2006 following a favourable 4/05). quivalent figure for 2004/05 of which £456,326 relates to amounts hority in respect of surpluses on the Collection Fund. Balance Sheet (see page 31) totalled £6,080,862, a decrease of an increase in the deficit on the pension fund. The Council has view undertaken on 31st March 2004 identified the increase in dium term projections for the budget have made provision for this nd an increase of £1,579,682, of which £1,542,960 is the result of uthority's General Fund to the Councils Initiatives Reserve. Budgets Under/(Over) Revised Actual Spending £ £ £ 791,480 716,918 74,562 1,024,840 1,041,159 (16,319) 3,395,200 3,778,751 (383,551) 1,813,040 1,676,284 136,756 350,650 338,698 11,952 2,492,070 2,036,961 455,109 2,601,480 2,060,191 541,289 - 278,000 (278,000) 12,468,760 11,926,962 541,798 (1,341,610) (1,329,870) (548,320) 1,579,682 - (157,000) (53,880) (52,845) 4,370 4,373 - 43,220 (1,386,700) (1,386,699) 17,600 17,140 9,160,220 10,644,963 1,106,120 1,106,119 10,266,340 11,751,082 (2,685,940) (2,685,937) (2,315,280) (2,315,808) (5,336,990) (5,337,050) (71,870) 1,412,287 ting entries of £121,000. Return to t revised budget. The Contents £000 110 38 117 58 69 40 256 (26) (24) (18) recharges) in 2005/2006 is as follows:- Rents Fees & Charges Interest Other Sources rnal recharges) in 2005/2006 is as follows:- Capital Financing Housing Benefits services for 2005/2006 is analysed as follows:- services for 2005/2006 is analysed as follows:- Highways, Roads Housing: Corporate and Non Distributed and Transport Democratic Core Costs Services st a budget of £3,300,000. The major areas of expenditure were £588,656 and expenditure on E-Government £891,149. Reason schemes with Housing Associations Return to Contents E-Government Town Centre Development Other Expenditure s, although 35p of every £1 spent came from third parties. Capital Grants Finance from Revenue Third Party Contributions ncy Services, Council Offices, Coleford in accordance with the n, interested members of the public have a statutory right to inspect unts for inspection is advertised in the local press. Return to Contents AUDITOR'S REPORT TO THE FOREST OF DEAN DISTRICT COUNCIL Opinion on the financial statements I have audited the financial statements of the Forest of Dean District Counicl for the year ended 31 Mar under the Audit Commission Act 1998, which comprise the Consolidated Revenue Account, the Collectio This report is made solely to Forest of Dean District Council in accordance with Part II of the Audit Com Act 1998 and for no other purpose, as set out in paragraph 36 of the Statement of Responsibilities of and of Audited Bodies, prepared by the Audit Commission. Respective Responsibilities of the Deputy Chief Executive and the Auditor The Chief Finance Officer's responsibilities for preparing the financial statements in accordance with ap laws and regulations and the Statement of Recommended Practice on Local Authority Accounting in th Kingdom 2005 are set out in the Statement of Responsibilities. My responsibility is to audit the financial staements in accordance with relevant legal and regulatory requ and International Standards on Auditing (UK and Ireland). I report to you my opinion as to whether the financial statements present fairly the financial positio Authority in accordance with applicable laws and regulations and the Statement of Recommended Pra Local Authority Accounting in the United Kingdom 2005. I review whether the statement on internal control reflects compliance with CIPFA's guidance "The State Internal Control in Local Government: Meeting the Requirements of the Accounts and Audit Regulation published on 2 April 2004. I report if it does not comply with proper practices specified by CIPFA statement is misleading or inconsistent with other information I am aware of from my audit of the statements. I am not required to consider, nor have I considered, whether the statement on interna covers all risks and controls. I am sols not required to form an opinion on the effectiveness of the Au corporate governance procedures or its risk and control procedures. I read the other information published with the financial statements, and consider whether it is consistent audited financial statements. This other information comprises only the Explanatory Foreward. I cons implications for my report if I become aware of any apparent misstatements or material inconsistencies financial statements. My responsibilities do not extend to any other information. Basis of audit opinion I conducted my audit in accordance with the Audit Commission Act 1998, the Code of Audit Practice is the Audit Commission and International Standards on Auditing (UK and Ireland) issued by the Auditing P Board. An audit includes examination, on a test basis, of evidence relevant to the amounts and disclosur financial statements. It also includes an assessment of the significant estimates and judgements mad Authority in the preparation of the financial statements, and of whether the accounting policies are appro the Authority's circumstances, consistently applied and adequately disclosed. I planned and performed my audit so as to obtain all the information and explanations which I co necessary in order to provide me with sufficient evidence to give reasonable assurance that the statements are free from material misstatement, whether caused by fraud or other irregularity or error. In my opinion I evaluated the overall adequacy of the presentation of the information in the financial stateme Opinion In my opinion the financial statements present fairly, in accordance with applicable laws and regulations Statement of Recommended Practice on Local Authority Accounting in the United Kingdom 2005, the position of the Authority at 31 March 2006 and its income and expenditure for the year then ended. District Auditor: Richard Lott Address: Audit Commission Westward House Lime Kiln Close Stoke Gifford Bristol BS34 8SR Date: 29 September 2006 Conclusion on arrangements for securing economy, efficiency and effectiveness in the use of res Authority Responsibilities The Authority is responsible for putting in place proper arrangements to secure economy, efficie effectiveness in its use of resources, to ensure proper stewardship and governance, and to regularly re adequacy and effectiveness of these arrangements. Under the Local Government Act 1999, the Authority is required to prepare and publish a best value perfo plan summarising the Authority's assessment of its performance and position in relation to its statutory make arrangements to ensure continuous improvement in the way in which its functions are exercised regard to a combination of economy, efficiency and effectiveness. Auditor's Responsibilities I am required by the Audit Commission Act 1998 to be satisfied that proper arrangements have been m the Authority for securing economy, efficiency and effectiveness in its use of resources. The Code Practice issued by the Audit Commission requires me to report to you my conclusion in relation to arrangements, having regard to relevant criteria specified by the Audit Commission for principal local au I report if significant matters have come to my attention which prevent me from concluding that the Autho I am required by section 7 of the Local Government Act 1999 to carry out an audit of the authority's be performance plan and issue a report: I am required by section 7 of the Local Government Act 1999 to carry out an audit of the authority's be performance plan and issue a report: - certifying that I have done so; - stating whether I believe that the plan has been prepared and published in accorda statutory requirements set out in section 6 of the Local Government Act 1999 and stat - where relevant, making any recommendations under section 7 of the Local Governme Conclusion I have undertaken my audit in accordance with the Code of Audit Practice and I am not satisfied tha regard to the criteria for the principal local authorities specified by the Audit Commission and publish 2005, in all significant respects, Forest of Dean District Council made proper arrangements to secure e efficiency and effectiveness in iths use of resources for the year ending 31 March 2006, in that it failed to - put in place arrangements for setting, reviewing and implementing its strategic and - put in place arrangements to monitor the quality of its published performance informa to report the results to memebers; - put in place arrangements to maintain a sound system of internal control; - put in place arrangements to manage its significant business risks; - put in plance arrangements that are designed to promote and ensure probity and pro the conduct of its business. Best Value Performance Plan I issued my statutory report on the audit of the Authority's best value performance plan for the finan 2005/06 on 9 October 2005. I did not identify any matters to be reported to the Authority and did not m recommendations on procedures in relation to the plan. Certificate I certify that I have completed the audit of the accounts in accordance with the requirements of th Commission Act 1998 and the Code of Audit Practice issued by the Audit Commission. District Auditor: Richard Lott Address: Audit Commission Westward House Lime Kiln Close Stoke Gifford Bristol BS34 8SR Date: 29 September 2006 STRICT COUNCIL Return to Contents nicl for the year ended 31 March 2006 evenue Account, the Collection Fund, e with Part II of the Audit Commission atement of Responsibilities of Auditors tements in accordance with applicable ocal Authority Accounting in the United vant legal and regulatory requirements ent fairly the financial position of the tement of Recommended Practice on CIPFA's guidance "The Statement on Accounts and Audit Regulations 2003" ractices specified by CIPFA or if the are of from my audit of the financial her the statement on internal control on the effectiveness of the Authority's onsider whether it is consistent with the Explanatory Foreward. I consider the nts or material inconsistencies with the tion. , the Code of Audit Practice issued by eland) issued by the Auditing Practices t to the amounts and disclosures in the timates and judgements made by the accounting policies are appropriate to ed. and explanations which I considered sonable assurance that the financial or other irregularity or error. In forming rmation in the financial statements. pplicable laws and regulations and the he United Kingdom 2005, the financial for the year then ended. fectiveness in the use of resources Return to Contents s to secure economy, efficiency and overnance, and to regularly review the and publish a best value performance sition in relation to its statutory duty to ich its functions are exercised, having per arrangements have been made by use of resources. The Code of Audit u my conclusion in relation to proper mmission for principal local authorities. rom concluding that the Authority has t an audit of the authority's best value t an audit of the authority's best value red and published in accordance with Government Act 1999 and statutory ction 7 of the Local Government Act ce and I am not satisfied that, having Audit Commission and publish in July oper arrangements to secure econony, March 2006, in that it failed to meet plementing its strategic and ublished performance information, and of internal control; iness risks; ote and ensure probity and propriety in erformance plan for the financial year to the Authority and did not make any e with the requirements of the Audit Commission. Return to Contents STATEMENT OF ACCOUNTING POLICIES 1. GENERAL The accounts have been prepared in accordance with the Code of Practice on Local Authority Accountin United Kingdom 2005: A Statement of Recommended Practice (the Code), and the Best Value Accounti of Practice 2005. 2. FIXED ASSETS The Code requires expenditure on the acquisitions, creation or enhancement of fixed assets to be capita an accruals basis. The following basis is used for the valuation of tangible assets: Operational assets; Non-Specialist pro Existing Use Value; Specialised properties - Depreciated Replacement Cost. Non-operational properties Market Value. Intangible assets have been valued in the accounts at cost. The current asset values used in the accounts are based upon certificates issued by Bruton Knowles a March 2004. Further details are included in the notes to the Consolidated Balance Sheet. 3. DEPRECIATION Depreciation has been provided for on all fixed assets with a finite useful life, which can be determine time of acquisition or revaluation. Where depreciation is provided for, assets have been depreciated u straight line method over the following periods: Buildings 15 to 40 years Vehicles, Plant and Equipment 5 to 10 years Infrastructure 20 or 40 years Non-Operational 10 to 40 years Intangible assets 3 to 5 years 4. DEFERRED CHARGES Deferred Charges are payments of a capital nature where no fixed asset is created, e.g. improvement g where the asset on which expenditure is incurred is not directly owned by the Council, e.g. Sports Centre All Deferred Charges expenditure is written out to revenue as it is incurred. 5. CAPITAL EXPENDITURE The authority has an accounting threshold of £10,000 for capital expenditure. If the aggregate of expend a specific project, over the life of that project, is not expected to exceed the threshold, it is financed from 6. CAPITAL CHARGES The capital charges made to service revenue accounts equate to the depreciation charge plus the interest charge based on the net amount at which the fixed asset is included in the balance sheet at 31 2005, reviewed in light of any material disposals in the year. The notional rate of interest used is 3.5% assets included in the balance sheet at current value and 4.95% for infrastructure assets and community 7. GOVERNMENT GRANTS Revenue government grants are accounted for on an accruals basis and income has been credite appropriate revenue account. Capital grants are accounted for on a cash basis. In the case of specifie grants the income has been credited to the appropriate revenue account. All other capital grants ha credited to a Government Grants Deferred account. Amounts are released from the Governmen Deferred account to offset any amortisation charge to the revenue account in respect of assets to which t 8. CAPITAL RECEIPTS Capital receipts arise from the disposal of assets and are held in the Useable Capital Receipts Rese used to finance new capital expenditure. 9. DEBTORS AND CREDITORS The revenue accounts of the Council are maintained on an accruals basis in accordance with the Accounting Practice and FRS18 'Accounting Policies'. That is, sums due to or from the Council during are included whether or not the cash has actually been received or paid in the year. An example of an e to this principle relates to electricity and similar quarterly payments, which are charged at the date reading rather than being apportioned between financial years. This policy is consistently applied each ye 10 . STOCKS AND WORKS IN PROGRESS Stocks are valued at the lower of cost or net realisable value, in accordance with SSAP9 'Stocks and long Work in progress on uncompleted jobs is valued at cost. 11 . COST OF SUPPORT SERVICES Costs of management and administration are normally fully allocated to services. The bases of allocat for the main costs of management and administration are outlined below: Professional Services (Legal, Engineers) Actual time spent by staff. & Central Departments. Office Telephone Systems Number of extensions Administrative Buildings Area occupied. Computer Service Actual use and number of terminals. 12 . PROVISIONS The Council sets aside provisions for specific future expenses which are certain to arise, but owing inherent nature cannot be quantified with any certainty. 13. RESERVES The Council maintains revenue reserves which have been set aside to be used at the discretion of the The purpose of these reserves is explained in note 16 to the Consolidated Balance Sheet. 14. INVESTMENTS Investments are shown in the Consolidated Balance Sheet at cost. Further details are included in note Balance Sheet. 15. PENSION COSTS - FRS 17 In assessing liabilities for retirement benefits at 31st March 2004 for the 2003/04 Statement of Accou actuary was required by the SORP to use a discount rate of 3.5% real (6.5% actual). For the 2005/06 St of Accounts, a rate based on the current rate of return on a high-quality corporate bond of equivalent and term to scheme liabilities is to be used. The actuary has advised that a rate of 1.7% real (4.9% a appropriate. Application of this rate has resulted in an increase in liabilities measured at todays prices o adjusted for by an increase in actuarial losses recognised for the year in the Statement of Total Move Reserves. 16. OPERATING LEASES Lease payments made under operating leases have been charged to revenue on a straight line basis, in accordance with guidance detailed in SSAP 21 'Accounting for leases and hire purchase contracts'. CIES Return to Contents e on Local Authority Accounting in the , and the Best Value Accounting Code ent of fixed assets to be capitalised on nal assets; Non-Specialist properties - ost. Non-operational properties - Open s issued by Bruton Knowles as at 31st Balance Sheet. l life, which can be determined at the sets have been depreciated using the s created, e.g. improvement grants, or he Council, e.g. Sports Centre sites ure. If the aggregate of expenditure on e threshold, it is financed from depreciation charge plus the notional ded in the balance sheet at 31st March rate of interest used is 3.5% for fixed ructure assets and community assets and income has been credited to the basis. In the case of specified capital nt. All other capital grants have been eased from the Government Grants in respect of assets to which the seable Capital Receipts Reserve until Return to asis in accordance with the Code of Contents to or from the Council during the year the year. An example of an exception ich are charged at the date of meter is consistently applied each year and e with SSAP9 'Stocks and long-term services. The bases of allocation used me spent by staff. of extensions se and number of terminals. re certain to arise, but owing to their e used at the discretion of the Council. Balance Sheet. er details are included in note 8 to the e 2003/04 Statement of Accounts, the % actual). For the 2005/06 Statement corporate bond of equivalent currency at a rate of 1.7% real (4.9% actual) is s measured at todays prices of £6.3m, n the Statement of Total Movement in nue on a straight line basis, in hire purchase contracts'. Return to Contents CONSOLIDATED REVENUE ACCOUNT FOR YEAR ENDED 31ST MARCH 2006 2004/2005 Note 2005/2006 Gross Expenditure £ Service £ 673,119 Central Services to the Public 1,147,555 944,255 Cultural and Related Services 2,032,392 3,162,103 Environmental Services 4,506,538 1,871,846 Planning and Development Services 3,592,010 307,723 Highways, Roads and Transport Services 347,700 1,862,233 Housing Services 19,468,951 2,423,986 Corporate and Democratic Core 2,158,069 378,000 10 Non Distributed Costs 278,000 11,623,265 Net Cost of Services 33,531,215 1,061,771 Parish Precepts 1,106,119 14,598 IDB and other Levies 17,140 (1,232,453) Interest and Investment Income - 178,000 10 Pension interest cost and expected return 2,601,000 Contribution of housing capital receipts to 82,486 (20,097) Losses/(gains) on repurchase of borrowing 4,373 (47,160) 1 Asset Management Revenue Account - 11,577,924 Net Operating Expenditure 37,342,333 APPROPRIATIONS 121,766 Contributions to/(from) Earmarked Revenue Reserves Transfer from Usable Capital Receipts equal to the contribution to Housing Pooled Capital Receipts 12,422 Capital expenditure financed from revenue (1,360,239) Surplus/(Deficit) to/(from) Housing Revenue Account Balances (121,764) 2 Reconciling amount for provisions for loan repayment (1,073,629) 4 Deferred Charges (834,000) 10 Movement on Pensions Reserve 8,322,480 Amount to be met from Government Grant & Taxpayers SOURCES OF FINANCE (5,150,307) 15 Demand on Collection Fund (2,490,986) Revenue Support Grant (2,195,198) Contribution from Non-Domestic Rate Pool (1,514,011) Net General Fund (Surplus)/Deficit (981,022) Balance on General Fund Brought Forward (2,495,033) Balance on General Fund Carried Forward D 31ST MARCH 2006 2005/2006 Return to Net Contents Income Expenditure £ £ 430,637 716,918 991,233 1,041,159 727,787 3,778,751 1,915,726 1,676,284 9,002 338,698 17,431,990 2,036,961 97,878 2,060,191 - 278,000 21,604,253 11,926,962 - 1,106,119 - 17,140 1,329,870 (1,329,870) 1,848,000 753,000 82,486 - 4,373 - - 24,782,123 12,560,210 1,579,682 (82,486) 43,220 - - - (910,000) Taxpayers 13,190,626 (5,337,050) (2,685,937) (2,315,808) 2,851,831 (2,495,033) 356,798 Return to Contents NOTES TO THE CONSOLIDATED REVENUE ACCOUNT 1. TRANSACTIONS ON THE ASSET MANAGEMENT REVENUE ACCOUNT Income Capital Charges Transfer from Government Grants Deferred Account Expenditure Provision for Depreciation External Interest Charges Transfer to Consolidated Revenue Account The net effect of this account is to transfer the difference between the notional capital charges and act Consolidated Revenue Account. 2. PROVISION FOR REPAYMENT OF EXTERNAL LOANS Grants amortised to depreciated fixed assets Amount Charged as Depreciation to General Fund Services Charge to Consolidated Revenue Account This comprises the difference between the depreciation charged to the General Fund (net of capital gran the Minimum Revenue Provision (MRP). The MRP is the minimum amount, calculated using a for Government, which the Council must set aside from its revenue accounts for debt repayment each year of the Council's housing stock at the end of 2002/2003 the Council's MRP is nil. 3. COMMUTATION ADJUSTMENT The commutation adjustment is an annual allowance to offset losses arising from the early repaym improvement grant loan charges subsidy by the Government in 1992/1993. Where the commutation adjustment exceeds the MRP, the Council can apply for a Capitalisation Dir expenditure from capital resources up to a sum equal to the difference. The Council's commutation ad was £84,000 but no Direction was requested. 4. DEFERRED CHARGES Deferred charges written off to revenue Less Government Grants and contributions This reverses out deferred charges written off to the revenue 5. PUBLICITY EXPENDITURE Set out below, under the requirement of section 5(1) of the Local Government Act 1986, is the Council's s Printing and stationery Public relations Advertising - recruitment Advertising - other Total This expenditure includes expenditure on items of publicity that are classified as exempt, i.e. that do no for separately as part of the Publicity Account. 6. STAFF EMOLUMENTS The number of employees whose remuneration, excluding pension contributions, was £40,000 or more in 2004/05 No. employees Remuneration Band £40,000 - £49,999 8 £50,000 - £59,999 2 £60,000 - £69,999 1 £70,000 - £79,999 1 £80,000 - £89,999 - 7. FINANCE AND OPERATING LEASES The Council no longer holds any assets of significance by way of operating or finance leases. 8. MEMBERS ALLOWANCES The allowances paid in 2005/2006 under The Local Authorities (Members Allowances) Amendment Regu Councillor Allowance £ Barraclough 3,100 Beard 3,100 Benstead 3,100 Bevan 3,100 Biddle 3,100 Birch 3,100 Brain 3,100 Burt 2,430 Butler 3,100 Clissold 3,100 Dalziel 3,100 Evans 3,100 Gardiner 4,030 Garnier 3,100 Glastonbury 3,100 Grant 587 Harper 2,925 Harris 4,650 Harrison Higgins 4,030 Henchley 4,022 Herbert 3,100 Hiett 3,100 Hobman 3,937 Hogan B 1,383 Hogan D 3,100 Horne 3,100 The above figures include a basic allowance for each member (£3,100) for the 2005/2006 Civic year, and Allowances where appropriate. The above allowances total £162,700 (2004/05 £161,943 ). 9. RELATED PARTY TRANSACTIONS The Council is required to disclose material transactions with related parties - bodies or individuals tha control or influence the Council or to be controlled or influenced by the Council. Disclosure of these viewers of the accounts to assess the extent to which the Council might have been constrained i independently or might have secured the ability to limit another party's ability to bargain freely with the Co Central Government - has effective control over the general operations of the Council - it is respon statutory framework within which the Council operates, provides the majority of its funding in the form o the terms of many of the transactions that the Council has with other parties (e.g. housing benefit transactions with government departments are set out in note 3 to the Cash Flow Statement. Central Government - has effective control over the general operations of the Council - it is respon statutory framework within which the Council operates, provides the majority of its funding in the form o the terms of many of the transactions that the Council has with other parties (e.g. housing benefit transactions with government departments are set out in note 3 to the Cash Flow Statement. Members of the Council - have direct control over the Council's financial and operating policies. During paid grants totalling £119,472 to voluntary organisations in which one or more members had an interest. with proper consideration of declarations of interest. The relevant members did not take part in any discu Further details can be obtained from the Register of Interests, which is available for inspection. Officers of the Council - returns were received from all members of the Corporate Management Team. T that none of these officers engaged in any related party transactions during the financial year. 10. PENSION COSTS As part of the term and conditions of employment of its officers and other employees, the Council offe Although these benefits will not be payable until employees retire, the Council has a commitment to which need to be accounted for when the employees entitlements are earned. The Council participates in the Local Government Pension Scheme, administered by Gloucestershire Co funded pension scheme, meaning that the authority and employees pay contributions into a fund, calcula to balance the pensions liabilities with the investment assets. The scheme is categorised as 'defined retirement benefits payable are predetermined based on the employees final salary. Financial Reporting Standard 17 'Retirements Benefits (Accounts Entries)' requires the Council to retirement benefits in the Net Cost of Services when they are earned by employees, rather than eventually paid as pensions. However, the charge that is required to be made against council tax is base in the year, so the following entries have been made in the Consolidated Revenue Account to comply wit Net cost of services Current Service Cost Past Service Cost Net operating expenditure Interest on Pension Scheme Liabilities Expected Return on Investments Movement on Pension Reserve Curtailment costs Net pension assets Amount Charged Employers Contribution payable An alternative presentation of the same information, showing where the figures are shown in Consolidated Revenue Account is : Current Service Cost Employers Contribution payable Curtailment costs Past Service Cost Interest on Pension Scheme Liabilities Expected Return on Investments Net pension assets Note 19 to the Consolidated Balance Sheet contains details of the assumptions made in estimating the note. Note 1 to the Statements of Total Movement in Reserves details the costs that have arisen thro estimates made in preparing the figures for previous years have had to be revised (e.g. the expected retu Further information can be found in Gloucestershire County Council's Pension Fund's Annual Report w November each year) upon request from: The Head of Service Delivery and Finance, Gloucestershire County Council, Shire Hall, Westgate Street, Gloucester. GL1 2TG 11. EXPENDITURE TO PROMOTE WELLBEING IN THE AREA Section 137 of the local Government Act 1972, as amended, empowers local authorities to make c charitable funds, not-for profit bodies providing a public service in the United Kingdom and mayoral app have the power to do so elsewhere. The expenditure was limited to £5.30 per head of population in 2005 The authority was permitted to spend £427,710 under this power in 2005/06 (£402,955 in 2004/05) and a 12. BUILDING CONTROL ACCOUNT The Building (Local Authority Charges) Regulations 1998 require the disclosure of information regarding for the administration of the building control function 'details of scheme for setting charges'. How performed by the Building Control Unit cannot be charged for, such as providing general advice and lias authorities. The statement below shows the total cost of operation of the building control unit divided betw Building Regulations Charging Account 2005/2006 Chargeable £ Expenditure Employee expenses 170,414 Premises 10,581 Transport 15,565 Supplies and services 16,670 Central and support service recharge 108,070 Total Expenditure 321,300 Income Building Regulation charges (293,627) Total Income (293,627) (Surplus)/Deficit for 2005/2006 27,673 Comparatives for 2004/2005 Expenditure 296,308 Income (315,175) (Surplus)/Deficit for year (18,867) 13. AUDIT FEES In 2005/2006 the Council incurred the Fees payable to the Audit Commission with regard to external audit services carried out by the appointed auditor Fees payable to the Audit Commission in respect of statutory inspection Fees payable to the Audit Commission for the certification of grant claims and returns Fees payable in respect of other services provided by the appointed auditor 14. INDUSTRIAL ESTATES The Council owns and rents out industrial units on an estate in the district. The turnover generated by th units is: Building Rents 15. DEMAND ON COLLECTION FUND The District Council does not receive income directly from Council Tax payers but has to make a deman the Collection Fund. Details of the Collection Fund Accounts are shown later. E ACCOUNT Return to Contents 2004/2005 2005/2006 £ £ (460,995) (485,919) (111,788) (121,767) (572,783) (607,686) 233,552 264,627 292,071 290,214 (47,160) (52,845) notional capital charges and actual interest paid to the 2004/2005 2005/2006 £ £ 111,788 121,767 (233,552) (264,627) (121,764) (142,860) General Fund (net of capital grants) for assets used and amount, calculated using a formula specified by the ts for debt repayment each year. Following the transfer P is nil. s arising from the early repayment (commutation) of 93. an apply for a Capitalisation Direction to fund revenue The Council's commutation adjustment for 2005/2006 2004/2005 2005/2006 £ £ 1,680,761 1,788,943 (607,132) (545,104) 1,073,629 1,243,839 ment Act 1986, is the Council's spending on publicity. 2004/2005 2005/2006 £ £ 46,794 46,671 46,869 80,883 54,056 75,951 33,327 41,308 181,046 244,813 sified as exempt, i.e. that do not have to be accounted ibutions, was £40,000 or more in bands of £10,000 2005/06 No. employees 3 6 1 - 1 ng or finance leases. Return to Contents s Allowances) Amendment Regulations were as Councillor Allowance £ Horsfield 3,100 Hunt 2,033 Kay 3,100 Martin 3,100 McMillan 3,575 Meredith-Edwards 3,100 Morgan 3,100 Preest 3,100 Pugh 3,100 Read 5,270 Roberts 5,270 Saunders 3,100 Shenoi 4,412 Smallwood 3,100 Stephens 3,337 Sterry 3,100 Stewart 3,100 Stuart 3,100 Thomas 3,100 Vick 4,650 Wagstaff 1,292 Waller 1,383 Whitelock 1,421 Windsor-Clive 4,650 Winship 4,412 or the 2005/2006 Civic year, and Special Responsibility 004/05 £161,943 ). arties - bodies or individuals that have the potential to e Council. Disclosure of these transactions allows the might have been constrained in its ability to operate bility to bargain freely with the Council. ns of the Council - it is responsible for providing the jority of its funding in the form of grants and prescribes er parties (e.g. housing benefit payments). Details of ash Flow Statement. ns of the Council - it is responsible for providing the jority of its funding in the form of grants and prescribes er parties (e.g. housing benefit payments). Details of ash Flow Statement. al and operating policies. During 2005/2006 the Council more members had an interest. The grants were made ers did not take part in any discussion or decision vailable for inspection. Corporate Management Team. These returns confirmed ng the financial year. Return to Contents ther employees, the Council offers retirement benefits. Council has a commitment to make future payments rned. ministered by Gloucestershire County Council. This is a contributions into a fund, calculated at a level intended heme is categorised as 'defined benefit' meaning that final salary. ntries)' requires the Council to recognise the cost of ed by employees, rather than when the benefits are made against council tax is based on the cash payable Revenue Account to comply with the standard: 2004/2005 2005/2006 £000 £000 961 959 229 - 2,204 2,601 (2,026) (1,848) 149 278 (834) (910) - 1,080 - (1,080) ere the figures are shown in the 2004/2005 2005/2006 £000 £000 961 959 (683) (1,080) 278 (121) Shown within the cost of services 149 278 229 - 378 278 Non Distributed Costs 2,204 2,601 Pension interest cost (2,026) (1,848) expected return on 178 753 assets (834) (910) Movement on Pensions Reserve mptions made in estimating the figures included in this s the costs that have arisen through the year because e revised (e.g. the expected return on investments). Pension Fund's Annual Report which is available (from very and Finance, Return to Contents wers local authorities to make contributions to certain nited Kingdom and mayoral appeals, where it does not 0 per head of population in 2005/06 (£5.00 in 2004/05). /06 (£402,955 in 2004/05) and actual expenditure was sclosure of information regarding the setting of charges eme for setting charges'. However, certain activities providing general advice and liasing with other statutory building control unit divided between the chargeable Non- Total Building Chargeable Control £ £ 44,220 214,634 2,749 13,330 4,104 19,669 3,812 20,482 28,081 136,151 82,966 404,266 - (293,627) - (293,627) 82,966 110,639 141,106 437,414 - (315,175) 141,106 122,239 2004/2005 2005/2006 £ £ 87,500 97,734 12,070 5,826 34,190 28,803 - - 133,760 132,363 ict. The turnover generated by these 2004/2005 2005/2006 £ £ 130,966 136,172 130,966 136,172 ayers but has to make a demand on ater. Return to Contents CONSOLIDATED BALANCE SHEET AS AT 31ST MARCH 2006 2004/2005 2005/2006 £ £ Fixed Assets 85,960 Intangible Fixed Assets Tangible Fixed Assets Operational Assets 5,511,895 Other Land & Buildings 394,935 Vehicles, Plant & Equipment 218,687 Infrastructure Assets 106,491 Community Assets Non-Operational Assets 1,483,500 Investment Properties 2,494,499 Surplus Assets, held for disposal 10,295,967 Total Fixed Assets 2,050,000 Long Term Investments 358,101 Long Term Debtors 12,704,068 Total Long Term Assets Current Assets 71,749 Stocks & Works in Progress 69,244 21,812,000 Temporary Investments 14,860,000 3,764,772 Debtors/Payments in Advance 3,405,182 38,352,589 Total Assets Current Liabilities Borrowing Repayable on Demand (17,587) or Within 12 Months (18,265) (2,156,208) Creditors/Receipts in Advance (2,860,206) (665,340) Cash Overdrawn (786,584) 35,513,454 Total Assets less Current Liabilities (6,012,519) Long Term Borrowing (5,994,254) (309,119) Deferred Capital Receipts (239,354) (5,200) Provisions (4,000) (20,613,000) (23,124,000) Liability related to defined benefit pension scheme 8,573,616 Total Assets less Liabilities (29,075,668) Fixed Asset Restatement Account 38,677,491 Capital Financing Account 2,261,582 Government Grants Deferred 10,792,194 Useable Capital Receipts Reserve (20,613,000) Pensions Reserve 3,967,393 Earmarked Revenue Reserves Revenue Balances: 68,591 Collection Fund 2,495,033 General Fund 8,573,616 Total Net Worth MARCH 2006 Return to 2005/2006 Contents £ Note 434,520 2 5,303,511 1 495,796 1 211,397 1 106,491 1 1,483,500 1 2,435,405 1 10,470,620 21 10,050,000 5 252,479 6 20,773,099 7 8 18,334,426 9 39,107,525 10 11 (3,665,055) 35,442,470 12 13 18 (29,361,608) 19 6,080,862 (29,381,936) 17 38,321,620 14 1,909,576 11,578,831 15 (23,124,000) 19 5,547,075 16 146,950 1,082,746 6,080,862 20 Return to Contents NOTES TO CONSOLIDATED BALANCE SHEET 1. TANGIBLE FIXED ASSETS Movement of Tangible Fixed Assets 2005/2006 Operational Assets Other Land Vehicles, Plant & Buildings & Equipment £ £ Certified value as at 31.3.2005 5,620,669 1,245,629 Accumulated depreciation -108,774 (850,694) Net Book Value as at 31.3.2005 5,511,895 394,935 Movement in 2005/2006 Additions 157,615 206,916 Disposals (101,055) - Restatement - 18,518 Transfers (160,906) - Expenditure which adds no value - - Depreciation (108,774) (124,573) Depreciation on assets sold 4,736 - Net Book Value as at 31.3.2006 5,303,511 495,796 Depreciation Accumulated depreciation 31.3.2006 (212,812) (975,267) Depreciation method used Straight line Straight line Useful lives 15 - 40 years 5 - 10 years The following statement shows the progress of the Council's rolling programme for the revaluation of as at 31st March 2004 by external independent valuer Bruce Fowler MRICS, IRRV of Bruton Knowles Accounting Policies.The Impairment Review undertaken as at 31st March 2006 by Phil Woosnam BS several public conveniences. These have been re-classified and transferred to surplus property 2006/2007 to establish their market value. The restatement shown under Vehicles, Plant and Equipme Operational Assets Other Land Vehicles, Plant & Buildings & Equipment £000 £000 Valued at historical cost - 495 Valued at current value in: 2003/2004 5,349 - 5,349 495 Information on Assets Held Fixed assets owned by the Council include the following: Number as at 31.3.2005 Other Land & Buildings Off Street Parking 15 Lorry Parks 2 Office Buildings 3 Public Conveniences 23 Cemetery Buildings 2 Swimming Pools 1 Vehicles, Plant & Equipment 19 Non-Operational Assets Surplus Property 16 Investment Property 12 The following Community Assets are owned by the Council and shown in the Balance Sheet at a nomi Amenity Land Broadwell-Woodville Ave. Cinderford-Greenway Road, Hollyhill Wood, Miner's Welfare Field, Triangle cutting. Mitcheldean-Deansway. Newent-Court Rd, Cleeve Mill Lane, Johnstone Rd, Knights Way/C Sedbury-allotments. Soudley-Dean Heritage Centre. Tibberton-Orchard Rise. Tidenham-Netherhope Forest cycle tracks. Cemeteries Yew Tree Brake - Cinderford, Mile End - Coleford 2. INTANGIBLE FIXED ASSETS Movement of Intangible Fixed Assets 2005/2006 Net Book Value as at 31.3.2005 Additions Movement in 2005/2006 Depreciation Net Book Value as at 31.3.2006 Accumulated depreciation 31.3.2006 Software licences are held for the following systems: * The on-line planning portal, which cost £30,000 and will be written off over 3 years; * Document imaging software which cost a total of £121,000 and will be written off over 4 & 5 * The Customer Relationship Management system which cost £133,000 & will be written off o * GIS software which cost £11,000 and will be written off over 5 years * A Planning/Environmental Health system which cost £22,000 and will be written off over 5 y * A Revenues system which cost £46,000 and will be written off over 5 years * Telephone system software which cost £40,000 and will be written off over 5 years * Software licences for the Council's website which cost £16,000 and will be written off over 5 * A new Personnel and Payroll system which cost £41,000 and will be written off over 4 years 3. DEFERRED CHARGES Balance brought forward Expenditure: Improvement Grants Other Total Expenditure Amounts written off to Consolidated Revenue Account Balance carried forward 4. CAPITAL EXPENDITURE AND FINANCING Opening Capital Financing Requirement Adjustment to opening CFR Capital Investment: Operational Assets Non-Operational Assets Deferred Charges Economic Loan Sources of Finance: Capital Receipts (Sale of Assets) Capital Grants Finance from Revenue (Capital Reserve) Third Party Contributions Closing Capital Financing Requirement Explanation of movements in year Increase in underlying need to borrow Increase in Capital Financing Requirement The Council had no major capital commitments at 31st March 2006. 5. LONG TERM INVESTMENTS The Council's longer term investments are as follows: Amount £ Kent Reliance Building Society 2,000,000 Heritable Bank 2,000,000 Close Brothers Bank 2,000,000 Chelsea Building Society 2,000,000 HSBC Bank 2,000,000 A.D.C. Debenture Stock 50,000 Total Long Term Investments 10,050,000 6. LONG TERM DEBTORS These are summarised as follows: Balance 31.3.2005 £ Housing Associations 27,218 Mortgages 302,480 Other Individuals 6,639 Car Loans to Employees 8,544 Economic Development Loans 13,220 Total Long Term Debtors 358,101 7. STOCKS & WORKS IN PROGRESS (WIP) The balances are summarised as follows: Sports Centre Stocks for Resale Central Services (Stationery & Canteen) Rechargeable Works WIP Total Stocks and Work in Progress 8. TEMPORARY INVESTMENTS The Council's short term investments are as follows : Norwich & Peterborough Building Society Norwich & Peterborough Building Society Nottingham Building Society Co-operative Bank Standard Life Money Market Fund Alliance Capital Fund Managers Total Short Term Investments 9. DEBTORS & PAYMENTS IN ADVANCE The balances are summarised as follows: Amounts Falling Due Within One Year From: Government Departments Community Charge Payers Business Rate Payers Council Tax Payers Sundry Debtors Total Debtors Sundry Payments in Advance PWLB Premiums paid in Advance Total Debtors & Payments in Advance Less Provisions for Bad Debts: Sundry Debtors Collection Fund Total Provisions for Bad Debts Total Net Debtors & Payments in Advance 10. BORROWING REPAYABLE ON DEMAND OR WITHIN 12 MONTHS Amounts payable on demand or within the next 12 months are: Public Works Loans Board Total borrowing repayable on demand or within 12 months 11. CREDITORS The balances are summarised as follows: Amounts due to: Government Departments Interest Accruals Collection Fund balance attributable to other local authorities Other Sundry Creditors Total Creditors & Prepayments 12. LONG TERM BORROWING Type of Loan Public Works Loans Board Total Long Term Borrowing The following statement gives a maturity analysis of the Council's debt, in excess of one year, by lende Maturity Analysis 1 - 2 years 2 - 5 years 5 - 10 years over 10 years Total 13. DEFERRED CAPITAL RECEIPTS Deferred capital receipts are amounts derived from sales of assets which will be received in instalment Balance Sheet relates to the total of mortgages outstanding on sales of Council houses, which are als Debtors. 14. CAPITAL FINANCING ACCOUNT Balance as at 1.4.2005 2005/2006 Capital Financing: Capital Receipts Revenue Government Grants and Other Contributions Reconciling amount for provisions for loan repayment Writing down of deferred charges Economic loan repayment Balance as at 31.3.2006 The Capital Financing Account provides a balancing mechanism between the different rates at which capital controls system 15. USEABLE CAPITAL RECEIPTS RESERVE This balance represents the accumulated value of past asset sales (i.e. capital receipts) which have n change in receipts in hand during 2005/2006 is summarised as follows: This balance represents the accumulated value of past asset sales (i.e. capital receipts) which have n change in receipts in hand during 2005/2006 is summarised as follows: Balance as at 1.4.2005 Amounts received in the year Pooling of Housing receipts Amounts applied to finance new capital investment Balance as at 31.3.2006 16. EARMARKED REVENUE RESERVES Details of revenue reserves and movements in balances are as follows: Balance Reserve 31.3.2005 £ Unforeseen Items 133,319 Interest Equalisation 263,200 Insurance 247,962 ADC Investment 50,000 Regeneration 54,998 Development of Financial Systems 17,883 Consultation - Student Post (Environmental Health) 5,911 Devolved Budgetary Control 34,080 Economic Development - Finance - Office Alterations 7,613 Centralised H.Q. Refurbishment 92,124 Best Value 33,224 Historic Buildings 46,090 Medium Term Expenditure 272,219 Recreation 3,005 Subsidy Losses 229,645 CPA Improvement Plan 90,000 Legal Fees - Licensing 94,000 Planning Delivery Grant - Members IT 37,000 Forest of Dean Partnership Projects 47,000 Restructuring 387,000 District Elections 17,500 BOWS Project - Local Development Framework 86,860 Sports Development 14,615 Commutation 56,340 Council Initiatives - Lydney Kids Club 216 Regeneration Capital 138,354 Public Convenience Refurbishment 37,410 Capital 1,441,206 Vehicle Replacement 28,619 Total Earmarked Revenue Reserves 3,967,393 Unforeseen Items - meets items of unbudgetted expenditure, which cannot be met from savings or vire Interest Equalisation - is used to smooth the effect on the revenue budget of changes in interest rates. Insurance - is used to meet minor claims arising from uninsured sundry risks. ADC Investment - this is to fund liabilities arising from the redemption of the ADC debenture. Regeneration - is to meet the Council's contribution towards regeneration issues. Development of Financial Systems - is to be used to implement an asset management system and an Consultation - is to be used to meet the costs of consultation on the community's priorities to feed i Plan. The reserve will also be used to fund the Best Value User Satisfaction Survey. Student Post (Environmental Health) - is to fund the cost of employing a third year EHO student. Devolved Budgetary Control - is for the carry forward, within Financial Regulations, of unspent budgets Economic Development - will be used to fund unforeseen economic development projects that arise as Finance - Office Alterations - was originally used to meet the costs arising from restructuring Financ fund a software license for the DIP system. Centralised HQ Refurbishment - is to cover potential repairs of plant and equipment. Best Value - the balance within this reserve has been transferred to the Consultation Reserve. Historic Buildings - is used to make grants towards the cost of building conservation. Medium Term Expenditure - is to be used to fund one off expenditure items. Recreation - is used to support the purchase of leisure centre equipment for the sports centres. Subsidy Losses - is to be used to cover shortfalls in subsidy due to the authority being a 'gainer' under CPA Improvement Plan - will be used to support initiatives approved by the Department for Comm Capacity Building Fund bid. Legal Fees - Licensing - was to cover any legal costs following the introduction of the new Licensing end of 2005/06 so the reserve was closed. Planning Delivery Grant - will be used to improve the services that Planning provide. Members IT - this will be used to improve the ICT for members. Forest of Dean Partnership Projects - this is to fund project bids. Restructuring - to meet costs arising from staff restructuring, including redundancy, pension lump sums District Elections - to meet the costs of future elections. BOWS Project - this will cover the costs of projects under the Building On Whats Special scheme. Local Development Framework - this will meet the costs relating to the LDF, including consultation and Sports Development - is to fund future sports events at the Council's leisure centres. Commutation Reserve - this is no longer relevant so the balance has been transferred to Economic partnership working. Commutation Reserve - this is no longer relevant so the balance has been transferred to Economic partnership working. Council Initiatives - this will be used to meet the initial cost of invest-to-save initiatives and for one-off Plan priorities. Lydney Kids Club - is to be used to cover any deficits on this activity. Regeneration Capital - will fund unforeseen regeneration initiatives that are not budgeted for and that Plan priorities. Public Convenience Refurbishment - is used to meet the costs of refurbishing public conveniences in a Capital - is used to finance capital expenditure. Vehicle Replacement - was used to meet the costs of replacing old and/or obsolete vehicles and plant. 17. FIXED ASSET RESTATEMENT ACCOUNT Balance as at 1.4.2005 Disposal of Fixed Assets Restatement of Fixed Assets Expenditure which does not increase asset values Depreciation on Assets Sold Balance as at 31.3.2006 This account provides the matching entry when fixed assets are revalued, upon either revaluation or di 18. PROVISIONS Details of provisions and movements in balances are as follows: Balance 2005/2006 31.3.2005 Additions £ £ Insurance 5,200 3,000 Total Provisions 5,200 3,000 This provision is to cover outstanding liability and property claims as at 31 March 2006, based on inform 19. DISCLOSURE OF NET PENSIONS LIABILITY Note 10 to the Consolidated Revenue Account details the Council's participation in the Local Governm The underlying assets and liabilities for retirement benefits attributable to the Council at 31 March 2006 31st March 2005 £'000 Estimated liabilities (48,153) Estimated assets 27,540 Net Asset/(Liability) (20,613) The liabilities show the underlying commitments that the Council has in the long term to pay ret substantial impact on the net worth of the Council as recorded in the Balance Sheet. However, the arrangements are in place to make good the deficit by increased contributions over the remaining w actuary. Fund liabilities have been assessed by Hymans Robertson, an independent firm of actuaries, using t that will be payable in future years dependent on assumptions about mortality rates, salary levels, etc. Estimates for the fund are based on the latest full valuation of the scheme The main assumptions used in their calculations have been: 2004/2005 Rate of inflation 2.9% Rate of increase in salaries 4.4% Rate of increase in pensions 2.9% Proportion of employees opting to take a lump sum * N/A Rate for discounting scheme liabilities 5.4% Note: Changes to the Local Government Pension Scheme permit employees retiring on or after 6 Apr on retirement in exchange for a reduction in their future annual pension. On the advice of our actua reliable evidence to assume a level of take-up of the change in the pension scheme. Consequently th as at 31 March 2006 does not include any allowance for this change to the pension scheme. Assets in the County Council Pension Fund are valued at fair value, principally market value for in categories, by proportion of the total assets held by the fund. Expected long-term % Equity investments Bonds 7.4 Property 4.6 Cash 5.5 4.6 Total 6.5 20. ANALYSIS OF NET ASSETS EMPLOYED General Fund Total Equity 21. ANALYSIS OF NET FIXED ASSETS BY FUND General Fund Net Book Value of Fixed Assets 22. CONTINGENT LIABILITIES The Council transferred its housing stock to Forest of Dean Housing on 31st March 2003. As part of year warranty to Forest of Dean Housing covering future liabilities or claims that may occur in resp potential liabilities such as contamination caused by previous land use, which could give rise to a pote The Council decided to self-fund the liability instead of paying for insurance cover following an extern contamination of the land is very low. A minimum sum of £5m will be retained within useable capital re As at 31st March 2006 the authority was contesting a legal action for £300,000, brought against it fo application. 23. CONTINGENT ASSETS The Council is contractually due a 25% share of up to £7.5 million to be generated from a VAT shelter Housing. This income accrues to the council over the ten years commencing 1st April 2003. As £245,102 from Forest of Dean of Housing for the financial year to 31st March 2006. At the 31st March 2003 the council had granted planning approvals with section 106 conditions that certain specified events occuring. These comprised the following: 1 agreement for the maintenance of a play area £66,200 1 agreement for town centre improvements and for pedestrian links in Cinderford totalling £ place at the balance sheet date this has subsequently become the subject of a legal challeng 24. STATEMENT OF ACCOUNTS ISSUE DATE The Statement of Accounts were issued to committee members on Wednesday 21st June 2006. 25. POST BALANCE SHEET EVENTS Long term borrowing detailed in the balance sheet amounts to £5,994,254. On the 19th April 2006 th treasury management strategy. As at the accounts issue date referred to in note 24 above, we are not aware of any further material po Return to Contents ational Assets Non-Operational Assets Asset Infrastructure Community Investment Surplus assets Total Properties held for disposal £ £ £ £ £ 288,906 106,491 1,483,500 2,494,499 4,084,490 (70,219) - - - 0 218,687 106,491 1,483,500 2,494,499 4,084,490 - 8,467 - - 8,467 - - - (220,000) (220,000) - - - - - - - - 160,906 160,906 - (8,467) - - (8,467) (7,290) - - - - - - - - - 211,397 106,491 1,483,500 2,435,405 4,025,396 (77,509) - - - - Straight line 40 years ng programme for the revaluation of fixed assets. A complete revaluation was undertaken wler MRICS, IRRV of Bruton Knowles. The basis of valuation is set out in the Statement of st March 2006 by Phil Woosnam BSC, MRICS identified changes in the operational use of nd transferred to surplus property and a valuation exercise will be undertaken during n under Vehicles, Plant and Equipment is an adjustment to reflect the full value of vehicles Operational Assets Non-Operational Assets Total Infrastructure Community Investment Surplus assets Properties held for disposal £000 £000 £000 £000 £000 212 - - - 707 - 106 1,483 2,445 9,383 212 106 1,483 2,445 10,090 Number as at 31.3.2006 14 2 3 17 2 1 20 17 12 hown in the Balance Sheet at a nominal value. Wood, Miner's Welfare Field, Triangle, Linear Park. Dymock-rear of The Crypt, Old railway ane, Johnstone Rd, Knights Way/Crescent, Cleeve Rise. Redbrook-S.of football ground. Orchard Rise. Tidenham-Netherhope Lane. Woolaston-Picnic area. Yorkley-Tomlin Place. Slipway Beachley Asset Software Total £ £ 85,960 85,960 372,550 372,550 (23,990) (23,990) 434,520 434,520 (23,990) (23,990) Return to Contents ll be written off over 3 years; 000 and will be written off over 4 & 5 years. h cost £133,000 & will be written off over 5 years over 5 years 22,000 and will be written off over 5 years tten off over 5 years ll be written off over 5 years £16,000 and will be written off over 5 years 00 and will be written off over 4 years 2004/2005 2005/2006 £ £ - - 759,983 1,142,079 920,778 646,864 1,680,761 1,788,943 (1,680,761) (1,788,943) - - 2004/2005 2005/2006 £ £ (521,825) (521,825) - (287,348) (521,825) (809,173) 211,925 745,548 50,411 - 1,680,761 1,788,943 - 15,000 (1,195,239) (804,098) (566,864) (553,570) (12,422) (43,219) (168,572) (348,604) (521,825) (9,173) - 800,000 - 800,000 Period Date (Years) Repayable 1.4 30.8.2006 2.0 26.2.2007 1.8 13.11.2007 Return to 3 26.8.2008 Contents 4 12.3.2010 22 28.7.2011 During 2005/06 Balance Advances Repayments 31.3.2006 £ £ £ - 27,218 - - 68,465 234,015 - 1,299 5,340 - 8,544 - 13,125 13,220 13,125 13,125 118,746 252,480 31st March 2005 2006 £ £ 14,412 13,628 31,488 27,627 25,849 27,989 71,749 69,244 Amount Term £ 1,000,000 Fixed to 13-Apr-2006 1,000,000 Fixed to 31-May-2006 1,000,000 Fixed to 8-Aug-2006 260,000 On demand 1,600,000 On demand 10,000,000 Externally managed fund 14,860,000 31st March 2005 2006 £ £ 714,722 419,587 5,545 5,193 192,173 196,067 1,214,227 1,111,821 2,025,654 2,044,424 4,152,321 3,777,092 18,390 19,043 69,142 64,769 4,239,853 3,860,904 (369,581) (350,529) (105,500) (105,193) (475,081) (455,722) 3,764,772 3,405,182 12 MONTHS 31st March 2005 2006 £ £ 17,587 18,265 17,587 18,265 Return to Contents 31st March 2005 2006 £ £ 200 214,981 2,288 2,084 394,887 851,213 1,758,833 1,791,928 2,156,208 2,860,206 31st March 2005 2006 £ £ 6,012,519 5,994,254 6,012,519 5,994,254 debt, in excess of one year, by lender category and by maturity bands. Total P.W.L.B. £ 18,971 35,652 416,341 5,523,290 5,994,254 s which will be received in instalments over agreed periods of time. The figure shown in the ales of Council houses, which are also included in the total of mortgages under Long Term £ £ 38,677,491 804,098 43,219 852,258 1,699,575 (264,627) (1,788,943) (1,876) 38,321,620 between the different rates at which assets are depreciated and are financed through the es (i.e. capital receipts) which have not yet been used to finance new capital spending. The lows: es (i.e. capital receipts) which have not yet been used to finance new capital spending. The lows: Return to Contents Total £ 10,792,194 1,673,221 (82,486) (804,098) 11,578,831 2005/2006 Balance Additions Payments 31.3.2006 £ £ £ 94,000 82,665 144,654 - 100,000 163,200 3,086 3,000 248,048 - - 50,000 - 17,063 37,935 - - 17,883 33,224 - 33,224 - - 5,911 54,750 34,080 54,750 173,723 - 173,723 - 5,110 2,503 10,000 - 102,124 - 33,224 - 1,800 5,754 42,136 103,480 152,680 223,019 - 1,570 1,435 41,698 214,778 56,565 - 74,020 15,980 - 94,000 - 255,945 - 255,945 - - 37,000 58,214 40,000 65,214 54,260 389,309 51,951 17,500 - 35,000 49,451 - 49,451 50,000 14,500 122,360 - 496 14,119 - 56,340 - 1,942,960 - 1,942,960 2,098 - 2,314 - 15,356 122,998 7,132 - 44,542 34,600 45,675 1,430,131 - 28,619 - 2,987,921 1,408,239 5,547,075 ch cannot be met from savings or virement. budget of changes in interest rates. undry risks. tion of the ADC debenture. neration issues. n asset management system and an internet payments system. n the community's priorities to feed into the review of the Community Plan and Corporate Satisfaction Survey. ying a third year EHO student. cial Regulations, of unspent budgets. ic development projects that arise as a result of partnership working. sts arising from restructuring Financial Services but the reserve is currently being used to nt and equipment. to the Consultation Reserve. ding conservation. ipment for the sports centres. o the authority being a 'gainer' under transitional protection rules introduced. oved by the Department for Communities and Local Government (DCLG) as part of the he introduction of the new Licensing Act. No costs had been incurred or committed by the Planning provide. ding redundancy, pension lump sums and capitalise costs. ding On Whats Special scheme. o the LDF, including consultation and public enquiries. il's leisure centres. has been transferred to Economic Development to fund projects that arise as a result of has been transferred to Economic Development to fund projects that arise as a result of est-to-save initiatives and for one-off projects that support or meet the Council's Corporate ty. s that are not budgeted for and that have the ability to help the Council meet its Corporate refurbishing public conveniences in accordance with the maintenance programme. d and/or obsolete vehicles and plant. Return to Contents £ (29,075,668) (321,055) 18,518 (8,467) 4,736 (29,381,936) evalued, upon either revaluation or disposal. 2005/2006 Balance Payments 31.3.2006 £ £ 4,200 4,000 4,200 4,000 as at 31 March 2006, based on information received from the Council's insurers. 's participation in the Local Government Pension Scheme. able to the Council at 31 March 2006 are as follows: 31st March 2006 £'000 (57,176) 34,052 (23,124) cil has in the long term to pay retirement benefits. The total liability of £23.1m has a n the Balance Sheet. However, the financial position of the Council remains healthy and d contributions over the remaining working life of employees, as assessed by the scheme dependent firm of actuaries, using the projected unit method, an estimate of the pensions out mortality rates, salary levels, etc. 2005/2006 3.1% 4.6% 3.1% 0.0% 4.9% employees retiring on or after 6 April 2006 to take an increase in their lump sum payment pension. On the advice of our actuaries we have taken the view that there is insufficiently e pension scheme. Consequently the valuation of the Council‟s retirement benefit liabilities ge to the pension scheme. alue, principally market value for investments, and consist of the following Proportion of Assets Return to 31 Mar 2005 31 Mar 2006 Contents % % 63.5 66.6 24.8 24.5 6.5 6.5 5.2 2.4 100.0 100.0 31st March 2005 2006 £ £ 8,573,616 6,080,862 8,573,616 6,080,862 31st March 2005 2006 £ £ 10,295,967 10,470,620 10,295,967 10,470,620 sing on 31st March 2003. As part of the transfer arrangements the Council provided a 10- es or claims that may occur in respect of land transferred to them. The warranty covers d use, which could give rise to a potential risk to the occupants of houses built on the land. r insurance cover following an external environmental study that concluded that the risk of be retained within useable capital receipts to cover this potential liability. These n for £300,000, brought against it for compensation concerning issues around a planning to be generated from a VAT shelter arrangement between the Council and Forest of Dean rs commencing 1st April 2003. As part of this arrangement the Council was entitled to 31st March 2006. vals with section 106 conditions that could give rise to future revenue receipts, subject to 0 destrian links in Cinderford totalling £150,000. However whilst a signed agreement was in ecome the subject of a legal challenge. n Wednesday 21st June 2006. 5,994,254. On the 19th April 2006 this debt was repaid in line with the authority's adopted e not aware of any further material post balance sheet events. Return to Contents STATEMENT OF TOTAL MOVEMENT IN RESERVES 2004/2005 £ Surplus/(Deficit) for the year: General Fund (28,949) Collection Fund 76,664 add back: Movements on specific revenue reserves 1,664,724 Movements on unamortised discounts (24,470) Pensions Reserve: appropriations (834,000) actuarial gains and losses (9,091,000) movement in liabilities relating to unfunded benefits 212,000 Transfer of Housing Revenue Account balance to General Fund (1,360,236) Total increase/(decrease) in revenue resources (9,385,267) Increase/(decrease) in useable capital receipts 324,995 445,098 Increase/(decrease) in unapplied capital grants and contributions Total increase/(decrease) in realised capital resources 770,093 Value of assets disposed of or sold (145,243) Capital receipts set aside 1,207,661 General Fund revenue resources set aside 485,368 Discharge of private mortgages and economic loans - Deferred charges written off in the year (1,680,761) Movement on Government Grants Deferred 16,516 Total increase/(decrease) in amounts set aside 28,784 to finance capital investment Total recognised gains and (losses) (8,731,633) RVES Return to 2005/2006 Note Contents £ (1,412,287) 78,359 1,579,682 - (910,000) (1,823,000) 222,000 - (2,265,246) 1 786,637 (401,922) 384,715 2 (306,268) 3 804,098 630,850 (1,876) (1,788,943) 49,916 (305,955) 4 (2,492,754) Return to Contents NOTES TO THE STATEMENT OF TOTAL MOVEMENTS ON RESERVES 1. MOVEMENTS IN REVENUE RESOURCES General Fund Balances £ Surplus/(deficit) for 2005/06 (1,412,287) Appropriations to/from revenue - Actuarial gains and losses relating to pensions - Movement in liabilities relating to unfunded benefits - (1,412,287) Balance brought forward at 1 April 2005 2,495,033 Balance carried forward at 31 March 2006 1,082,746 Earmarked Revenue Reserves (i) Earmarked reserves represent amounts set aside from profits or balances in order to or activity. Pensions Reserve (ii) Prior to the financial year 2003/04 liabilities in relation to retirement benefits wer contributions became payable to the pension fund or payments fell due to the pe responsible (i.e. on a cash basis). Under FRS 17 we are now required to recognis funds assets and liabilities in our accounts. The Pensions Reserve represents the net value of the Council's pensions assets and Pensions Reserve - actuarial gains and losses The actuarial gain/loss identified under the Pensions Reserve above, together w analysed into the following categories, measured as absolute amounts and as a perc 2003/04 2004/05 £'000 % £'000 Difference between the 3,810 13.1 642 Difference between (60) 0.2 (2,493) Changes in financial - - (7,240) 3,750 (9,091) 2. MOVEMENTS IN REALISED CAPITAL RESOURCES Useable Capital Receipts £ Amounts receivable in 2005/2006 1,673,221 Pooling of Housing receipts (82,486) Amounts applied to finance new capital investment in 2005/2006 (804,098) Total increase/(decrease) in realised capital resources in 2005/2006 786,637 Balance brought forward at 1st April 2005 10,792,194 Adjustment to balance brought forward Balance carried forward at 31st March 2006 11,578,831 3. VALUE OF ASSETS DISPOSED OF OR SOLD Disposal of Fixed Assets Restatement of Fixed Assets Expenditure which does not increase asset values Depreciation on Assets sold Balance brought forward at 1st April 2005 Balance carried forward at 31st March 2006 4. MOVEMENTS IN AMOUNTS SET ASIDE TO FINANCE CAPITAL INVESTMENT Capital Financing Account £ Capital receipts set aside in 2005/2006: Useable receipts applied 804,098 Total capital receipts set aside in 2005/2006 804,098 Revenue resources set aside in 2005/2006: Capital expenditure financed from revenue & grants 895,477 Reconciling amount for provisions for loan repayment (264,627) Total revenue resources set aside in 2005/2006 630,850 Discharge of Economic Loans (1,876) Deferred charges written off in the year (1,788,943) Grants applied to finance capital investment in 2005/2006 - Amounts credited to the Asset Management Revenue Account in 2005/2006 - Movement on Government Grants Deferred - Total increase/(decrease) in amounts set aside to finance capital investment (355,871) Balance brought forward at 1st April 2005 38,677,491 Adjustment to balance brought forward - Balance carried forward at 31st March 2006 38,321,620 Return to Contents Collection Earmarked Pensions Fund Revenue Reserve (ii) Balances Reserves (i) £ £ £ 78,359 - - - 1,579,682 (910,000) - - (1,823,000) - - 222,000 78,359 1,579,682 (2,511,000) 68,591 3,967,393 (20,613,000) 146,950 5,547,075 (23,124,000) rom profits or balances in order to fund expenditure on a specific item elation to retirement benefits were only recognised when employers d or payments fell due to the pensioners for which we were directly we are now required to recognise the Council's share of the pension the Council's pensions assets and liabilities as assessed by the funds ions Reserve above, together with prior year comparatives, can be s absolute amounts and as a percentage of assets or liabilities at 31 2004/05 2005/06 % £'000 % 2.3 4,578 13.4 5.2 (129) 0.2 15.0 (6,272) 3.2 (1,823) Unapplied Capital Grants and Contributions £ 500,252 - (902,174) (401,922) 263,169 445,098 306,345 Fixed Asset Restatement Account (321,055) 18,518 (8,467) 4,736 (306,268) (29,075,668) (29,381,936) PITAL INVESTMENT Government Grants Deferred Total £ £ - 804,098 - 804,098 - 895,477 - (264,627) - 630,850 - (1,876) - (1,788,943) 902,174 902,174 - (852,258) (852,258) 49,916 49,916 49,916 (305,955) 1,998,413 40,675,904 (445,098) (445,098) 1,603,231 39,924,851 Return to Contents CASHFLOW STATEMENT 2005/2006 2004/2005 2005/2006 £000 £000 Revenue Activities Cash Outflows 7,939 Cash paid to and on behalf of Employees 8,389 8,700 Other operating cash payments 8,998 3,099 Transfer of funds to Forest of Dean Housing 839 10,670 Housing Benefit paid out 11,556 9,163 National Non Domestic Rate payments to National Pool 8,503 25,185 Precept - Gloucestershire County Council 26,277 4,466 Precept - Gloucestershire Police Authority 4,638 1,062 Parish Precepts 1,106 70,284 Cash Inflows (3,064) Payments received on behalf of Forest of Dean Housing (839) (31,478) Council Tax receipts (33,070) (9,670) National Non Domestic Rate receipts (9,189) (2,195) National Non Domestic Rate receipts from National Pool (2,537) (2,491) Revenue Support Grant (2,686) (15,755) DSS Grants for Housing Benefits (16,633) (683) Other Government Grants (714) (2,750) Cash received for goods and services (2,875) (3,265) Other operating cash receipts (1,949) (71,351) (1,067) Deficit/(Surplus) on Revenue Activities Returns on Investments and Servicing of Finance Cash Outflows 278 Interest paid 277 Cash Inflows (859) Interest received (1,385) Capital Activities Cash Outflows 2,068 Purchase of fixed assets 2,302 - Other capital cash payments 79 Cash Inflows (1,235) Sale of fixed assets (1,713) (1,485) Capital Grants received (309) (93) Other capital cash receipts (298) (2,393) Net Cash (Inflow)/Outflow before Financing Management of Liquid Resources 1,500 Net increase/(decrease) in short term investments Financing Cash Outflows 17 Repayments of amounts borrowed 18 Cash Inflows - New loans raised - (876) (Increase)/Decrease in Cash and Cash Equivalents 2005/2006 £000 Note Return to Contents 70,306 3 3 3 (70,492) (186) 1 (1,108) 3 61 (1,233) 1,100 5 18 4 (115) 2 Return to Contents NOTES TO THE CASHFLOW STATEMENT 1. RECONCILIATION OF SURPLUS ON THE CONSOLIDATED REVENUE ACCOUNT TO NET CASHFLOW SURPLUS ON REVENUE ACTIVITIES £000 Consolidated Revenue Account Deficit for the Year Surplus on Collection Fund attributable to the Council Non Cash Transactions: Contributions to/(from) Reserves 1,580 Other Items (12) Items on an Accruals Basis: Decrease in Revenue Debtors 360 Reduction in Revenue Creditors 703 Increase in Stock (3) Items classified in another classification in the cash flow statement Servicing of Finance Deficit on Revenue Activities 2. INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS Balance Balance Movement in 31.3.200531.3.2006 the Year £000 £000 Cash at Bank* - 167 Overnight Deposits at Bank 312 260 Decrease in Cash & Cash Equivalents * Reconciliation of Cash Book to Bank Balance Overdraft per Statement of Accounts 2004/2005 Costing and Imprest transactions Cash in Transit less Unpresented Cheques Overdraft per Statement of Accounts 2005/2006 Costing and Imprest transactions Cash in Transit less Unpresented Cheques 3. ANALYSIS OF GOVERNMENT GRANTS The Government Grants received in 2005/2006 were: £000 £000 £000 Revenue DSS Grants for Housing Benefits 16,633 Revenue Support Grant 2,686 Other: Housing Subsidy 98 DEFRA Waste Minimisation 26 Local Authority Business Growth Incentive Scheme 117 Communities against Drugs 119 Single Regeneration Budget 75 DCLG Planning Delivery 205 DCLG Homelessness 21 DCLG Capacity Building Fund 18 DTLR Street Wardens and BOWS 35 714 20,033 Capital Specified Capital Grant 159 DTLR E-Government 150 309 Total Government Grants Received 20,342 4. REPAYMENT OF AMOUNTS BORROWED M Balance Balance ovement in 31.3.200531.3.2006the Year £000 £000 £000 Borrowing Repayable on Demand or Within 12 Months 18 18 - Long Term Borrowing 6,012 5,994 (18) (18) 5. LIQUID RESOURCES This is the net movement on short term investments made by the Council and is summarised Moveme nt in the Year £000 Short Term Investments Made 52,102 Short Term Investments Repaid 51,002 1,100 EVENUE ACCOUNT TO NET Return to Contents £000 (1,412) 78 (1,334) 1,568 1,060 (1,108) 186 Movement in the Year £000 167 (52) 115 665 3 104 (772) - 787 3 70 (1,027) (167) Movement in the Year Return to Contents and is summarised the Year Return to Contents COLLECTION FUND 2005/2006 INCOME AND EXPENDITURE ACCOUNT 2004/2005 £ £ INCOME 31,272,084 Council Tax Transfers from General Fund 4,054,681 Council Tax Benefits 9,101,420 Income Collectable from Business Ratepayers 44,428,185 EXPENDITURE Precept and Demands 25,185,122 Gloucestershire County Council 26,277,478 4,465,990 Gloucestershire Police Authority 4,637,702 5,150,307 Forest of Dean District Council 5,337,050 Business Rates 8,942,051 Payment to National Pool 8,700,878 117,385 Cost of Collection Allowance 116,999 16,500 Interest on Repayments 10,642 Bad and Doubtful Debts/Appeals #REF! Council Tax (9,995) 25,093 Business Rates 32,986 3,220 Adjustments to previous years' expenditure 6,837 Adjustments to previous years' Community Charges #REF! 515,680 Surplus/(Deficit) for the Year (52,203) Fund Balance Brought Forward 463,477 Fund Balance (335,410) Gloucestershire County Council (59,477) Gloucestershire Police Authority 68,590 Balance as at 31st March 2005 006 CCOUNT 2005/2006 Return to £ Note Contents 32,370,881 4,423,645 8,861,505 3 45,656,031 36,252,230 8,828,519 22,991 17,607 - 45,121,347 534,684 463,477 998,161 (723,519) (127,694) 146,948 Return to Contents NOTES TO THE COLLECTION FUND 1. GENERAL This account reflects the statutory requirement for billing authorities to maintain a separate Collection the transactions in relation to Business Rates, Council Tax and residual Community Charge. It illustrat been distributed to preceptors or the General Fund. The Collection Fund is consolidated with other acco 2. COUNCIL TAX & TRANSFERS FROM GENERAL FUND The Council set a Band D tax of £1,234.51 (County Council and Police Authority precepts and Fore Council demand) for 2005/2006. The tax rate is calculated by dividing the Council's demand on the Collection Fund by the tax base and tax rate for the County Council and the Police Authority, and is expressed as a level of tax at Band D. The Tax Base is calculated as follows: Band Number of Proportion to Band D Chargeable Dwellings Band D Equivalent Z 16.50 5/9 9.19 A 4,980.50 6/9 3,320.53 B 7,924.40 7/9 6,163.60 C 7,053.95 8/9 6,270.24 D 4,814.95 1 4,814.95 E 3,473.70 11/9 4,245.58 F 1,714.70 13/9 2,476.72 G 873.25 15/9 1,455.40 H 62.50 2 125.00 Armed forces Class "O" Contributions in lieu of Council Tax 169.44 Council Tax Base set for 2005/2006 The Tax Base reflects a projected collection rate (98.0%) which anticipates changes during arising from successful appeals against valuation banding, new properties, demolitions, disable 3. BUSINESS RATES The Council collects non-domestic (business) rates for its area. These are based on local rateable valu 31st March 2006) multiplied by a rate in the pound set by central government (42.2p for 2005/2006). Th certain reliefs and other deductions, is paid to a central pool (the N.N.D.R. Pool) managed by central go turn pays back to authorities their share of the Pool based on a standard amount per head of the local ad The Council collects non-domestic (business) rates for its area. These are based on local rateable valu 31st March 2006) multiplied by a rate in the pound set by central government (42.2p for 2005/2006). Th certain reliefs and other deductions, is paid to a central pool (the N.N.D.R. Pool) managed by central go turn pays back to authorities their share of the Pool based on a standard amount per head of the local ad The amounts credited to the Collection Fund are as follows: £ Amount Due from Business Ratepayers 12,829,885 Less Allowances and other adjustments 3,968,380 8,861,505 4. PRECEPTS AND DEMANDS All significant precepts and demands are detailed in the main Collection Fund Income and Expenditure A 5. FUND BALANCE The balance of the Collection Fund is analysed between the precepting/demanding authorities on the precepts/demands. The balance as at 31st March is the amount estimated to be receivable by the Counc Return to Contents separate Collection Fund, which shows nity Charge. It illustrates how these have dated with other accounts of the Council. ty precepts and Forest of Dean District d by the tax base and then adding on the l of tax at Band D. Tax Base 9.01 3,254.12 6,040.33 6,144.84 4,718.65 4,160.67 2,427.19 1,426.29 122.50 166.05 28,469.64 pates changes during the year , demolitions, disabled persons on local rateable values (£28,535,593 at p for 2005/2006). The total amount, less anaged by central government, which in er head of the local adult population. on local rateable values (£28,535,593 at p for 2005/2006). The total amount, less anaged by central government, which in er head of the local adult population. me and Expenditure Account. ng authorities on the ratio of their latest ceivable by the Council. Return to Contents GLOSSARY OF FINANCIAL TERMS AUDIT COMMISSION: An independent body, whose objectives are to appoint external auditors to local authorities and to he about improvements in efficiency, directly through the auditing process and through the "value for money BALANCES: In general, the surplus or deficit on any account at the end of the year. Often used to refer to the available to meet expenditure in future years. BILLING AUTHORITY: The authority that sets the Council Tax and collects it from Council Tax payers BUDGET: A statement defining the council's policy over a specified period of time in terms of finance, and so including physical and manpower data. CAPITAL CHARGE: A charge to service revenue accounts to reflect the cost of fixed assets used in the provision of services. CAPITAL RESERVE: An internal fund of the authority created to finance capital expenditure. The fund is built up by contributio revenue. CAPITAL RECEIPTS: Capital money received from the sale of land or other assets, which is available partly to finance other capital spending, and partly to repay loan debt. CAPITAL EXPENDITURE: The acquisition of assets which have a long-term value to the authority in the provision of its services (e. purchasing existing buildings or erecting new ones, purchasing furniture, equipment, etc. CAPPING: A maximum level of expenditure and Council Tax set by Government. CIPFA: The Chartered Institute of Public Finance and Accountancy. This is the professional body for acc working in local government and public bodies. The Institute provides financial and statistical info services for local government and advises central government and other bodies on local government and COMMUNITY ASSETS: Assets that generally have no determinable useful life, there often being restrictions regarding their Sedbury allotments or Woolaston picnic area. COUNCIL TAX: Council Tax is levied within its area by the billing authority and the proceeds are paid into its Collection distribution to precepting authorities and for use by its own General Fund. CORPORATE AND DEMOCRATIC CORE: Corporate and Democratic Core is defined as comprising two service divisions: a) Democratic Representation and Management (DRM) - in simplistic terms, DRM includes all as member activities including policy making and the representation of local interests. b) Corporate Management (CM) - concerns the activities and costs that provide the infrastructure th services to be provided, whether by the authority or not and the information required for public accountab DEPRECIATION: The measure of the wearing out, consumption, or other reduction in the useful economic life of a fixe whether arising from use, passage of time or obsolescence through technological or other changes. DISCOUNT: A sum received on the early repayment of debt before its original maturity date. A discount is given when of interest payable on the debt is lower than interest rates prevailing at the time of repayment. EMOLUMENTS: All sums paid to or receivable by an employee and sums due by way of expenses allowances (as far sums are chargeable to UK Income Tax) and the money value of any other benefits received other than Pension contributions payable by either employer or employee are excluded. ESTIMATE: Original Estimate: the estimate for the new year approved before the start of the financial year itself, u the previous November's price levels. Revised Estimate: the original estimate for the year updated by price changes since it was prepared supplementary estimates and virement. Supplementary Estimate: an amount which has been approved by the Council to be spent in exces original estimate. EXCEPTIONAL ITEMS: Material items which derive from events or transactions that fall within the ordinary activities of the auth which need to be disclosed separately by virtue of their size or incidence to give fair presentatio accounts. EXTRAORDINARY ITEMS: Material items, possessing a high degree of abnormality, which derive from events or transactions outside the ordinary activities of the authority and which are not expected to recur. They do not exceptional items nor do they include prior period items merely because they relate to a prior period. EXTERNAL AUDIT: The independent examination of the accounts of local authorities. This is carried out on behalf of t Commission by either the District Auditor or a private firm of auditors. FEES AND CHARGES: Income arising from the provision of services, e.g. leisure facilities, land charges. FINANCE LEASE: A lease that transfers substantially all of the risks and rewards of ownership of a fixed asset to the lesse a transfer of risks and rewards may be presumed to occur if at the inception of the lease the present valu minimum lease payments, including any initial payment, amounts to substantially all of the fair valu leased asset. FINANCIAL REGULATIONS: A formal code of procedures to be followed in the financial management of the Council. FIXED ASSETS: Tangible assets that yield benefits to the local authority and the services it provides for a period of more t GENERAL FUND (GF): The account which deals with the income and expenditure of the District Council other than that arising letting of local authority houses. GOVERNMENT GRANTS: Assistance by government and inter-government agencies and similar bodies, whether local, nat international, in the form of cash or transfers of assets to an authority in return for past or future complian GROSS EXPENDITURE: The cost of providing the council's services before deduction of government grants or other sources of inc HOUSING BENEFITS: Introduced in the Social Security and Housing Benefits Act 1982 - a system of financial assistance tow rent and Council Tax of those in financial need. Costs incurred by councils are partly reimbursed by direc INFRASTRUCTURE ASSETS: Fixed assets, expenditure on which is recoverable only by continued use of the asset created. Exam infrastructure assets are highways, footpaths and land drainage schemes. INTANGIBLE FIXED ASSETS: Assets without physical substance that yield benefits to the authority and the service it provides for a peri INVESTMENTS - LONG TERM: A long term investment is an investment that is intended to be held for use on a continuing basis in the ac NET BOOK VALUE: The amount at which fixed assets are included in the balance sheet, i.e. their historical cost or current va the cumulative amounts provided for depreciation. NET EXPENDITURE: Gross expenditure less specific service income, but before making a demand on the Collection Fund. NON-OPERATIONAL ASSETS: Fixed assets held by a local authority but not directly occupied, used or consumed in the delivery of s Examples of non-operational assets are investment properties and assets that are surplus to requiremen OPERATING LEASES: A lease other than a finance lease. OPERATIONAL ASSETS: Fixed assets held and occupied, used or consumed by the local authority in the direct delivery of those for which it has either a statutory or discretionary responsibility. OUTTURN: Actual income and expenditure. PRECEPT: The levy made by a precepting authority on the billing authority, requiring it to collect income from Counci PRECEPTING AUTHORITIES: Those authorities that are not billing authorities, i.e. do not set or collect Council Tax. County Council authorities and other joint authorities are 'major precepting authorities' and Parish, Community and Town PREMIUM: A sum due on the repayment of debt before its original maturity date. A premium is charged when the interest payable on the debt is higher than interest rates prevailing at the time of repayment. REVENUE SUPPORT GRANT (RSG): A grant paid by central government to local authorities in aid of revenue generally and not for specific ser REVENUE EXPENDITURE: This is expenditure on day-to-day running costs and consists principally of salaries and wages, genera expenses and capital financing costs. SPECIFIC GRANTS: Government grants to local authorities in aid of particular projects or services, e.g. housing bene magistrates courts grant, police grant. STANDARD SPENDING ASSESSMENT: An assessment by the Government of the level of spending required by each individual authority to p standard level of service throughout the country. STANDING ORDERS: The set of rules adopted by the Council which establish the procedures by which the Council should op particular, there will be financial standing orders and financial regulations to govern financial administra the tendering procedures. SUPPORT SERVICES: Those services which provide the administrative and financial back-up to staff involved in the direct delive TANGIBLE FIXED ASSETS: Assets with physical substance that yield benefits to the authority and the service it provides for a period VIREMENT: The approved transfer of budget from one head (income or expenditure) to another within a financial yea Return to Contents to local authorities and to help bring d through the "value for money" r. Often used to refer to the amount e in terms of finance, and sometimes ed in the provision of services. e fund is built up by contributions from ailable partly to finance other items of the provision of its services (e.g. land), quipment, etc. he professional body for accountants s financial and statistical information odies on local government and public g restrictions regarding their sale e.g ds are paid into its Collection Fund for terms, DRM includes all aspects of nterests. t provide the infrastructure that allow n required for public accountability. useful economic life of a fixed asset, logical or other changes. date. A discount is given when the rate time of repayment. expenses allowances (as far as those er benefits received other than in cash. d. rt of the financial year itself, usually at hanges since it was prepared and by Council to be spent in excess of the ordinary activities of the authority and ence to give fair presentation of the from events or transactions that fall ected to recur. They do not include ey relate to a prior period. is carried out on behalf of the Audit Return to arges. Contents ip of a fixed asset to the lessee. Such on of the lease the present value of the bstantially all of the fair value of the the Council. provides for a period of more than one Council other than that arising from the r bodies, whether local, national or urn for past or future compliance with nt grants or other sources of income. em of financial assistance towards the are partly reimbursed by direct grant se of the asset created. Examples of he service it provides for a period of on a continuing basis in the activities heir historical cost or current value less nd on the Collection Fund. consumed in the delivery of services. that are surplus to requirements, in the direct delivery of those services to collect income from Council Tax Council Tax. County Councils, Police Return to Parish, Community and Town Contents premium is charged when the rate of me of repayment. nerally and not for specific services. of salaries and wages, general running services, e.g. housing benefit grant, each individual authority to provide a y which the Council should operate. In to govern financial administration, e.g. taff involved in the direct delivery of service it provides for a period of more another within a financial year. Return to Contents