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Statement of Accounts 2017-18

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Statement of Accounts 2017-18 Statement of Accounts 2017-18 www.norfolk.gov.uk Contents NARRATIVE REPORT 3 STATEMENT OF RESPONSIBILITIES 13 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF NORFOLK COUNTY COUNCIL 14 SINGLE ENTITY STATEMENTS 18 COMPREHENSIVE INCOME AND EXPENDITURE STATEMENT 18 MOVEMENT IN RESERVES STATEMENT 19 BALANCE SHEET 20 CASH FLOW STATEMENT 21 NOTES TO THE CASH FLOW STATEMENT 21 NOTES TO THE FINANCIAL STATEMENTS 23 1. ACCOUNTING POLICIES 23 2. EXPENDITURE AND FUNDING ANALYSIS 37 3. EXPENDITURE AND INCOME ANALYSED BY NATURE 39 4. ACCOUNTING STANDARDS ISSUED, NOT ADOPTED 40 5. CRITICAL JUDGEMENTS IN APPLYING ACCOUNTING POLICIES 40 6. ASSUMPTIONS MADE ABOUT THE FUTURE AND OTHER MAJOR SOURCES OF ESTIMATION UNCERTAINTY 41 7. MATERIAL ITEMS OF INCOME AND EXPENSE 42 8. EVENTS AFTER THE REPORTING PERIOD 42 9. ADJUSTMENTS BETWEEN ACCOUNTING BASIS AND FUNDING BASIS UNDER REGULATIONS 42 10. TRANSFERS TO/FROM EARMARKED RESERVES 44 11. OTHER OPERATING EXPENDITURE 47 12. FINANCING AND INVESTMENT INCOME AND EXPENDITURE 47 13. TAXATION AND NON-SPECIFIC GRANT INCOME 47 14. PROPERTY, PLANT AND EQUIPMENT 48 15. HERITAGE ASSETS 52 16. INVESTMENT PROPERTIES 53 17. FINANCIAL INSTRUMENTS 55 18. DEBTORS 57 19. CASH AND CASH EQUIVALENTS 57 20. ASSETS HELD FOR SALE 58 21. CREDITORS 58 22. PROVISIONS 58 23. GRANT INCOME 59 24. USABLE RESERVES 61 25. UNUSABLE RESERVES 61 26. TRADING OPERATIONS 64 27. AGENCY SERVICES 64 28. JOINT ARRANGEMENTS 65 29. MEMBERS ALLOWANCES 68 30. OFFICERS REMUNERATION 68 31. EXTERNAL AUDIT COSTS 72 32. DEDICATED SCHOOLS GRANT 72 33. RELATED PARTY TRANSACTIONS 73 34. CAPITAL EXPENDITURE AND CAPITAL FINANCING 74 35. LEASES 75 36. PFI AND SIMILAR CONTRACTS 77 37. IMPAIRMENT LOSSES 78 38. PENSION SCHEMES ACCOUNTED FOR AS DEFINED CONTRIBUTION SCHEMES 78 39. DEFINED BENEFIT PENSION SCHEMES 79 40. CONTINGENT LIABILITIES 85 41. NATURE AND EXTENT OF RISKS ARISING FROM FINANCIAL INSTRUMENTS 85 Statement of Accounts 2017-18 - 1 - Norfolk County Council 42. FOUNDATION SCHOOLS 88 43. FUNDS ADMINISTERED FOR THIRD PARTIES 88 44. TRUST FUNDS 89 NORFOLK FIRE FIGHTERS PENSION FUND ACCOUNTS 90 GROUP ACCOUNTS 92 GROUP COMPREHENSIVE INCOME AND EXPENDITURE STATEMENT 96 GROUP MOVEMENT IN RESERVES STATEMENT 97 GROUP BALANCE SHEET 99 GROUP CASH FLOW STATEMENT 100 NOTES TO THE GROUP CASH FLOW STATEMENT 100 NOTES TO THE GROUP ACCOUNTS 102 1. ACCOUNTING POLICIES 102 2. GROUP COMPREHENSIVE INCOME AND EXPENDITURE STATEMENT (GROUP CIES) 103 3. TAX EXPENSES OF GROUP ENTITIES 103 4. PROPERTY, PLANT AND EQUIPMENT 104 5. INTANGIBLE ASSETS 106 6. INVENTORIES 106 7. DEBTORS 107 8. CASH AND CASH EQUIVALENTS 107 9. CREDITORS 107 10. DEFINED BENEFIT PENSION SCHEMES 108 11. RESERVES 110 12. LEASING 110 13. FINANCIAL INSTRUMENTS 111 NORFOLK PENSION FUND ACCOUNTS 113 INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF NORFOLK COUNTY COUNCIL 114 GLOSSARY OF TERMS 169 Statement of Accounts 2017-18 - 2 - Norfolk County Council Narrative Report Introduction This narrative report provides a brief analysis of the Council’s performance and financial position during the year, and assists in the interpretation of the financial statements, including the Group Accounts. It contains a commentary on the major influences affecting the authority’s financial results, and includes the following sections: An introduction to Norfolk County Council Financial highlights Outlook for the future Explanation of the financial statements Further information An introduction to Norfolk County Council Council Services in Norfolk Norfolk County Council is a large shire county representing the whole of Norfolk. Local Government services in Norfolk are also provided by seven district/borough councils and numerous town and parish councils. County Council Services include Adult Social Services Environmental Policy Records Office Building Conservation Fire Service Registrars Children’s Services Highways (incl. Footpaths) Road and Footway Lighting Coroners Libraries Strategic Planning Countryside Museums Tourism County Farms Planning Trading Standards Economic Development Public Health Waste Management Emergency Planning Public Transport Support Youth Service Democracy Norfolk County Council has 84 elected members each representing an electoral division of up to 10,000 voters. Every four years the people of each division elect one councillor. The most recent election took place in May 2017 and resulted in a Conservative majority. The Council has a Committee structure. Committees, whose membership reflects the overall political makeup of the Council, debate, challenge and make decisions. At the start of 2017-18 there were five service committees: Adult Social Care, Children’s Services, Communities, Environment Development and Transport, and Policy and Resources. Two additional service committees were set up during 2017-18: the Business and Property Committee is responsible for promoting economic development and regeneration, and the Digital Innovation and Efficiency Committee is responsible for ICT management and for delivering the Council’s commitment to exploit digital technologies for the benefit of the County of Norfolk and its residents. Service Committees are supported by a number of specialist committees, panels and working groups. The Council’s operational structure (approved December 2016) is based on four Executive Directors alongside the Chief Legal Officer and a Strategy Director, all reporting to the Managing Director. The directors lead the following five departments: Children’s Services; Adult’s Services; Community and Environmental Services; Finance and Commercial Services; and the Managing Director’s Department which encompasses Legal and Democratic Services and Strategic Services. This structure is intended to secure improvements in both strategic and transactional services required to meet the changing needs of different customer groups across the council. Statutory officer roles report to the Managing Director in fulfilling their statutory responsibilities. Progress through 2017-18 The following section looks at progress within each of the major service areas affecting Norfolk’s residents through 2017-18. Statement of Accounts 2017-18 - 3 - Norfolk County Council Infrastructure Construction of the Norwich Northern Distributor Road (NDR – the A1270, also known as the Broadland Northway) made good progress over the summer of 2017, allowing the opening of the first 6 km, from the A1270 Fakenham Road to the A140 Cromer Road, to open in November, more than three months ahead of schedule. This was followed by the next 7.75km to the A1151 Wroxham Road before Christmas. The final phase of 5.25km linking to the Postwick Hub roundabout included the most complex structure on the route – a flyover carrying the dual carriageway over the Norwich to Sheringham railway opened to traffic in April 2018. The Council has continued to develop the initial business case appraisal for a Norwich Western Link to join the NDR to the Norwich southern bypass. Work is well under way on transport improvements to make it easier to get into and around Great Yarmouth, using £9m provided from New Anglia Local Enterprise Partnership. In autumn 2017 work began to improve some of the town’s congestion hot spots and the area around the railway station. This will benefit both visitors and the borough’s economy. The 2017 Autumn Budget contained some great news for Norfolk, as Chancellor Philip Hammond committed £98m of Government funding to create a third river crossing in Great Yarmouth. Together with King’s Lynn and West Norfolk Borough Council, the County Council is looking to create a new stretch of road that would re-route the A10 to connect to the A47 east of West Winch. This will enable significant planned housing growth as well as routing traffic out of the village. In addition, a number of pedestrian and cycling improvements have been made in Norwich during the year, and in September 2017 the Environment, Development and Transport Committee agreed to carry out a series of studies looking at short, medium and long-term transport impacts of growth in Norfolk’s market towns to help the Council identify and plan interventions ahead of growth. Economy In 2017-18 Norfolk County Council supported prestigious international genome conferences in Norwich, a new Business & Intellectual Property (IP) Centre launched at Norfolk and Norwich Millennium Library where entrepreneurs and small businesses can find free IP and business information, and a successful bid to the European Social Fund resulted in the launch of a new Local Investment in Future Talent programme. Funding allocated to rural businesses in Norfolk and north Suffolk through the LEADER programme - an initiative managed by the Council - passed the £3m mark in December. Since the local programme started, the five Local Action Groups have awarded millions to 69 rural projects. The county’s rural economy was also boosted in November with the launch of Strong Roots: New Growth - Norfolk Rural Strategy 2017-2020. This built on the Norfolk Rural Development Strategy published in 2013, responding to changes such as the UK voting to leave the EU, the introduction of the National Living Wage and rapid advances in technology. More than 1,000 acres of Norfolk County Council’s 16,738-acre County Farms portfolio was made available for tenancy in January, including additional farmland purchased in September. County Council-owned Scottow Enterprise Park (SEP) was selected as a shortlisted finalist in the Best Service Delivery Model category in the 2018 Local Government Chronicle Awards.
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