This report updates the Committee on the preparation of the draft 2023/24 Statement of Accounts and the status of the accounts for 2020/21, 2021/22 and 2022/23.

The Committee received a report on the preparation of the draft 2023/24 Statement of Accounts which was nearing completion, and the status of the previous two years’ accounts which were currently unaudited.  In future, the accounts would be signed off by Council, with the Audit and Governance Committee playing a pivotal role in their scrutiny.

The report stated that, following publication of last year’s 2022/23 draft accounts in February 2024, the Council’s Finance Team had been able to focus more activity on closing the management accounts for 2023/24 against a revised and much shortened closedown timetable.  The remaining work concerned the preparation of group accounts by consolidating the accounts of the Council’s three wholly owned companies, Brighter Futures for Children, Reading Transport Ltd, and Homes for Reading and then preparing respective Cash Flow Statements.  The Council intended to publish the draft 2023/24 Statement of Accounts by the end of August 2024. 

The Committee was reminded that both the 2021/22 and 2022/23 draft statements of accounts had been published on the Council’s website.  It would be the responsibility of the Council’s previous auditors EY to provide an opinion on these accounts, and feedback received to date indicated that both sets of accounts would have disclaimed opinions.  The national picture showed many English councils had backlogs in receiving their external audit opinions.  The historic backlog meant that many councils would find it difficult to complete their draft accounts on time and/or have them audited in a timely manner.  The General Election meant the Government had not been able to implement the necessary legislation to enable a phased set of backstop dates by which outstanding audit opinions would be given.  As a result of this, CIPFA had announced revisions to their approach to focus instead on longer term improvements in local authority financial statements and reporting, utilising a revitalised Better Reporting Group.

Separate from the requirement to provide an audit opinion, EY would complete a Value for Money Assessment for both 2020/21 and 2021/22. The Council had been providing information to support this process since the beginning of 2024 and EY had confirmed their reports were nearing completion.  It was expected that the final assessments could be presented to this Committee in September 2024.  The final version of the External Auditor’s (EY) report was appended to the report, which had been presented previously in draft form during the audit process for the 2020/21 Statement of Accounts which had been approved and signed off under delegation in April 2024.

Resolved:       That the accounts progress and findings to date be noted.