The Deputy Director of Resources presented a report for Members of the Corporate Affairs Committee to receive and review the Middlesbrough Council Statement of Accounts 2012/2013. The 2012/2013 Statement of Accounts had been prepared in compliance with International Financial Reporting Standards (IFRS).
A list of the main alterations made to the Accounts since the draft was presented to the Committee in June 2013 was detailed on pages two and three of the submitted report and were as follows:
LACSEG Grant Income - Additional grant income of £803K relating to 2012/2013 was received and initially recognised in the 2013/2014 Comprehensive Income and Expenditure Statement. The Balance Sheet, Explanatory Forward and the Review of the Year had been amended to reflect the surplus on the revised outturn position.
Weekly Refuse Collection Grant - This grant had been reclassified from a capital grant to a revenue grant. A transfer of £2,162K had been made between two lines on the Comprehensive Income and Expenditure statement. There was no overall impact.
Investment Property Capital Receipts - Capital receipts from the sale of Investment Properties had been shown on the wrong line on the Comprehensive Income and Expenditure Statement. A transfer of £2,276K had been made between the two lines. There was no overall impact on the Balance Sheet or Accounts.
Capital Receipt - Payment for a piece of land sold by the Council had been received on a phased basis. So income of £1,060K was received in 2013/2014 but was transferred back to the 2012/2013 Accounts. This had increased the usable reserves on the Balance Sheet by the same amount.
MMI Provision - Resources set aside to cover the cost of potential payments to Municipal Mutual Insurance (MMI) had been reclassified as a provision and transferred from the Insurance reserves. As a result, Usable Reserves on the Balance Sheet had decreased by £1,020K.
Investment Properties - three assets had been reclassified from Property, Plant and Equipment to Investment Properties, prior to their demolition. £1,371K had been transferred between two lines on the Comprehensive Income and Expenditure Statement and there was no overall impact on the Accounts.
Heritage Assets Donation - The Council received a donated Heritage Asset during 2012-2013 - The Christopher Dresser Pottery Collection. An increase in income of £617K had therefore been included in the Comprehensive Income and Expenditure Statement and the Usable Reserves on the Balance Sheet had increased by the same amount.
Officers Remuneration - details of a number of exit packages had been omitted from the Officers Remuneration note in error. The note had been amended to include the additional details.
A - A number of additional property valuations had been carried out since the draft accounts were
published and the Comprehensive Income and Expenditure Statement and Balance Sheet
had been amended to reflect a net downward revaluation of £176K.
B - As part of the revaluations, prior year adjustments had been made to the accounts to reflect the fact
that four properties had been overvalued. The 2010011 Balance Sheet had been restated to reflect
the net downward revaluation of £13.6m.
C - The previous valuation of the Bus Station had been overstated and the 2010-2011 Balance Sheet had
been restated to reflect a downward revaluation of £16.9m. The Valuer had miscalculated the size of
the Bus Station and it had therefore been valued incorrectly five years ago. Therefore it was not a
reduction in value as the value of the asset had been overstated originally.
D - The 2012/2013 valuation for Levick House was incorrectly calculated and there was therefore an
increase in expenditure on the Comprehensive Income and Expenditure Statement of £203K. Usable
Reserves on the Balance Sheet had increased by the same amount.
In response to a query regarding the incorrect valuations it was explained that valuations were completed on a rolling programme over a five year period. Since the previous years External Auditors report, the programme of valuations had been made more robust. The information provided on the Balance Sheet had been refined and improved. The External Auditor was confident that all previous errors had been highlighted and addressed. However it was noted that if the basis of a valuation was changed there would always be an impairment.
It was confirmed that following the alterations to the draft Accounts there was no impact on the Councils overall financial standing.
Members suggested that it would be helpful if the summary could include the page number in the Accounts that related to each item, for ease of reference.
A copy of the full Statement of Accounts had been made available to all Members of the Corporate Affairs Committee and a copy placed in the Members Library. Once the External Auditor had signed them, a copy of the Accounts would be available on the Councils website. The final Statement of Accounts had been produced within the timetable.
Notice had been given in the local press for any interested persons to inspect, and make copies of the Statement of Accounts and other supporting documents between 3 July and 30 July 2012. There had been one interested person this year.
ORDERED that the Middlesbrough Council Statement of Accounts 2012/2013 be approved.